Document:

Exhibit 10.1

 

EXECUTION VERSION

 

AMENDMENT NO. 1 TO CREDIT AGREEMENT

 

AMENDMENT NO. 1 TO CREDIT AGREEMENT, dated as of January 15, 2013 (this “Amendment”), to that certain CREDIT AGREEMENT, dated as of June 19, 2012 (as amended, supplemented, or otherwise modified from time to time, the “Credit Agreement”) among NGL ENERGY PARTNERS LP, a Delaware limited partnership (“Parent”), NGL ENERGY OPERATING LLC, a Delaware limited liability company (“Borrowers’ Agent”), each subsidiary of the Parent identified as a “Borrower” under the Credit Agreement (together with the Borrowers’ Agent, each a “Borrower” and, collectively, the “Borrowers”), DEUTSCHE BANK AG, NEW YORK BRANCH (“DBNY”), as technical agent (in such capacity, together with its successors in such capacity, the “Technical Agent”) and DEUTSCHE BANK TRUST COMPANY AMERICAS (“DBTCA”), as administrative agent for the Secured Parties (in such capacity, together with its successors in such capacity, the “Administrative Agent”) and as collateral agent for the Secured Parties (in such capacity, together with its successors in such capacity, the “Collateral Agent”) and each financial institution identified as a “Lender” and an Issuing Bank under the Credit Agreement (each a “Lender, together with the Technical Agent, the Administrative Agent, and the Collateral Agent, collectively, the “Secured Parties”).

 

RECITALS

 

WHEREAS, the Borrowers have requested that the Lenders make certain amendments to the Credit Agreement; and

 

WHEREAS, the Lenders have agreed to amend the Credit Agreement solely upon the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the parties hereto hereby agree as follows:

 

1.             Defined Terms.  Unless otherwise noted herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

2.             Amendments to Section 1.1 (Defined Terms) of the Credit Agreement.

 

(a)           The definitions of “Acquisition Revolving Commitment,” “Total Acquisition Revolving Commitment,” “Total Commitment,” “Total Working Capital Revolving Commitment,” and “Working Capital Revolving Commitment,” as set forth in Section 1.1 of the Credit Agreement are hereby amended as set forth below:

 

(i)            The last sentence of the definition of “Acquisition Revolving Commitment” is hereby deleted in its entirety and replaced with the following:

 

“The initial aggregate amount of the Acquisition Revolving Lenders’ Acquisition Revolving Commitments as of the Amendment No. 1 Effective Date is $527,500,000.”

 

(ii)           The last sentence of the definition of “Total Acquisition Revolving Commitment” is hereby deleted in its entirety and replaced with the following:

 

 

“As of the Amendment No. 1 Effective Date, the Total Acquisition Revolving Commitment is $527,500,000.”

 

(iii)                               The last sentence of the definition of “Total Commitment” is hereby deleted in its entirety and replaced with the following:

 

“As of the Amendment No. 1 Effective Date, the Total Commitment is $770,000,000.”

 

(iv)                              The last sentence of the definition of “Total Working Capital Revolving Commitment” is hereby deleted in its entirety and replaced with the following:

 

“As of the Amendment No. 1 Effective Date, the Total Working Capital Revolving Commitment is $242,500,000.”

 

(v)                                 The last sentence of the definition of “Working Capital Revolving Commitment” is hereby deleted in its entirety and replaced with the following:

 

“The initial aggregate amount of the Working Capital Revolving Lenders’ Working Capital Revolving Commitments as of the Amendment No. 1 Effective Date is $242,500,000.”

 

(b)           The definition of “Clean-Down Period” shall be deleted in its entirety.

 

(c)            The below terms shall be added as new definitions in their respective alphabetical order in the Credit Agreement:

 

“‘Amendment No. 1 Effective Date’ means January 15, 2013.”

 

“‘ECP Collateral Shortfall’ has the meaning assigned to such term in Section 2.5(f) of this Agreement.”

 

“‘ECP Collateral’ means the Collateral provided by the ECP Grantors.”

 

“‘ECP Grantor’ means each Grantor that qualifies as an “eligible contract participant” under Title VII of the Dodd-Frank Wall Street Reform Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith.”

 

“‘Exempted Joint Venture’ means, at any time, any Business Entity that is not a Credit Party (i) whose Equity Interests are directly held legally or beneficially by a Credit Party (or group of Credit Parties) in an amount not to exceed 75% of the outstanding Equity Interests of such Business Entity, determined as of the date the Borrower’s Agent designated such Business Entity to be an “Exempted Joint Venture” consistent with (iii) below, (ii) all of whose Equity Interests held by any Credit Party are subject to a first priority perfected security interest for the benefit of the Secured Parties consistent with the Security Agreement (except that such Equity Interests shall not be deemed “Excluded Assets” as defined in the Security Agreement), (iii) that has been designated, in writing, by the Borrowers’ Agent to the Administrative Agent to be an “Exempted Joint Venture”, and (iv) that is engaged in a business consistent with Section 7.5 of this Agreement.”

 

“‘Maximum Commitment’ means $820,000,000.”

 

“‘Non-ECP Grantor’ means each Grantor that is not an ECP Grantor.”

 

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“‘Non-ECP Collateral’ means the Collateral provided by the Non-ECP Grantors.”

 

3.             Amendment to Section 2.1(c) of the Credit Agreement (Reallocation of Commitments).  Section 2.1(c) of the Credit Agreement is hereby amended by (i) deleting the phrase “10 Business Days” as it appears at the end of clause (i) in the third sentence of Section of 2.1(c), and (ii) inserting in lieu thereof “5 (five) Business Days”.

 

4.             Amendment to Section 2.4(c) of the Credit Agreement (Increase in Total Commitments).  Clauses (D) and (E) of the proviso of Section 2.4(c) of the Credit Agreement is hereby amended by deleting each clause in its entirety and inserting in lieu thereof the following:

 

“(D) the aggregate amount of Facility Increases from the Amendment No. 1 Effective Date until the Termination Date shall not exceed $50,000,000, (E) at no time shall the Total Commitments exceed the Maximum Commitment”

 

5.             Amendment to Section 2.5(f) of the Credit Agreement (Clean Down Period).  Clause (f) of Section 2.5 of the Credit Agreement is hereby amended by deleting such clause in its entirety and inserting in lieu thereof the following :

 

“(f)          If the Collateral would, at any time, reasonably be expected to yield proceeds insufficient to repay the Secured Qualified Hedging Obligations pro rata with the other Obligations after applying such proceeds in a manner consistent with Section 9 of the Intercreditor Agreement and the limitation on the application of Non-ECP Collateral set forth in Section 2.1 of the Security Agreement (the positive amount of such insufficiency, the “ECP Collateral Shortfall”), then the Borrowers shall immediately cause the Secured Qualified Hedging Obligations to be prepaid or otherwise collateralized in an amount sufficient to reduce the ECP Collateral Shortfall to the pro rata shortfall, if any, on the other Obligations; provided that no prepayment or collateralization shall be required if the Borrowers’ Agent submits a written plan to the Administrative Agent and the Technical Agent within three (3) Business Days (or such later date as is acceptable to the Technical Agent) of the existence of the ECP Collateral Shortfall, which plan shall provide for the conversion of Non-ECP Collateral to ECP Collateral (whether through guaranties or keepwell agreements of Non-ECP Grantors, or through any other means consistent with the Dodd-Frank Wall Street Reform Consumer Protection Act, as determined by the Technical Agent in its reasonable discretion) and which plan shall be (i) satisfactory to the Technical Agent in its reasonable discretion, (ii) expected to reduce the ECP Collateral Shortfall consistent with this Section 2.5(f), and (iii) fully implemented within ten (10) Business Days (or such later date as is acceptable to the Technical Agent) of the existence of the applicable ECP Collateral Shortfall.”

 

6.             Amendment to Section 2.15(a) of the Credit Agreement (Letters of Credit).  Clause (ix) of Section 2.15(a) of the Credit Agreement is hereby amended by (i) deleting “$5,000,000” as it appears at the end thereof and (ii) inserting in lieu thereof “$50,000,000”.

 

7.             Amendment to Section 6.10(c) of the Credit Agreement (Borrowers; Guarantors; Joinder Agreements).  Section 6.10(c) of the Credit Agreement is hereby amended by (i) deleting the “.” at the end thereof and (ii) adding the following immediately following the phrase “sole discretion)” as it appears at the end thereof:

 

; provided  further that no Subsidiary that has been designated by the Borrowers’ Agent as an Exempted Joint Venture shall be required to become a Guarantor or grant any Liens

 

3

 

hereunder or under any other Loan Document to the extent that such Subsidiary continues to qualify as an Exempted Joint Venture; it being understood that no Exempted Joint Venture shall be eligible for an exemption from the requirements of this Section 6.10 if at the time of designation by the Borrowers’ Agent, the Investment basket set forth in Section 7.7(l) of this Agreement has been exhausted.”

 

8.             Amendment to Section 7.2 of the Credit Agreement (Liens).  Section 7.2 of the Credit Agreement is hereby amended by (i) deleting “and” as it appears at the end of clause (n) thereof; (ii) deleting the punctuation “.” at the end of clause (o) thereof and inserting in lieu thereof “; and”, and (iii) by adding the following as new clause (p) immediately following clause (o) thereof:

 

“(p)         Liens arising from the posting of cash or Cash Equivalents in favor of a Qualified Counterparty as and when required pursuant to Hedging Agreements permitted under Section 6.17.

 

9.             Amendment to Section 7.7 of the Credit Agreement (Investments, Loans).  Section 7.7 of the Credit Agreement is hereby amended by (i) deleting “and” as it appears at the end of clause (j) thereof; (ii) deleting the punctuation “.” at the end of clause (k) thereof and inserting in lieu thereof “; and”, and (iii) by adding the following as new clause (l) immediately following clause (k) thereof:

 

“(l)          loans or advances to, or Investments in, any Exempted Joint Venture; provided that (i) the aggregate amount of all loans, advances and Investments permitted under this provision shall not exceed $125,000,000 during the term of this Agreement and (ii) that with respect to each such loan, advance, or Investment hereunder, the Credit Parties shall be in pro forma compliance with the financial covenants set forth in Section 7.11 of this Agreement immediately before and after giving effect to such loan, advance or Investment.”

 

10.          Amendment to Section 10.18 of the Credit Agreement (Guaranty).  Section 10.18 of the Credit Agreement is hereby amended by adding the following as new clause (h) immediately following clause (g) thereof:

 

“Notwithstanding anything to the contrary contained herein or in any other Loan Documents, no Non-ECP Grantor shall guaranty any Secured Qualified Hedging Obligations.”

 

11.          Amendment to Schedule 1.1A of the Credit Agreement (Revolving Credit Commitments).  Schedule 1.1A of the Credit Agreement is hereby amended by deleting such Schedule in its entirety and replacing it with the Schedule 1.1A attached hereto as Exhibit I.

 

12.          Representations and Warranties.  To induce the Lenders to enter into this Amendment, the Borrowers hereby represent and warrant to the Lenders that the representations and warranties contained in the Credit Agreement and other Loan Documents are true and correct in all material respects on and as of the date hereof with the same effect as though made on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties were true and correct in all material respects as of such earlier date).

 

13.          Conditions to Effectiveness.  This Amendment shall become effective upon the first date on which each of the following conditions has been satisfied:

 

4

 

(a)           Amended Loan Documents.  The Administrative Agent shall have received this Amendment, and the omnibus amendment to the Security Documents, each executed and delivered by a duly authorized officer of each Credit Party party to such amendment, in form and substance satisfactory to the Technical Agent; and

 

(b)           Amended Notes.  Each Lender that has requested an amended Notes to reflect its revised Commitments under the Credit Agreement, shall have received such requested Notes in form and substance satisfactory to it.

 

14.          Fees and Expenses.  The Borrowers shall, upon demand, pay to the Administrative Agent the amount of any and all reasonable fees, costs and expenses incurred in connection with this Amendment as provided pursuant to Section 10.9 of the Credit Agreement.

 

15.          Limited Effect.  Except as expressly provided hereby, all of the terms and provisions of the Credit Agreement and the other Loan Documents are and shall remain in full force and effect.  The amendments contained herein shall not be construed as a waiver or amendment of any other provision of the Credit Agreement or the other Loan Documents or for any purpose except as expressly set forth herein or a consent to any further or future action on the part of any Credit Party that would require the waiver or consent of the Lenders.  This Amendment shall constitute a “Loan Document” for all purposes of the Credit Agreement and the other Loan Documents.

 

16.          GOVERNING LAW.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAW OF THE STATE OF NEW YORK.

 

17.          Counterparts.  This Amendment may be executed in any number of counterparts, all of which taken together shall constitute one and the same agreement, and any of the parties hereto may execute this Amendment by signing any such counterpart.  Delivery of an executed counterpart hereof by facsimile or email transmission shall be effective as delivery of a manually executed counterpart hereof.

 

18.          Headings.  Section or other headings contained in this Amendment are for reference purposes only and shall not in any way affect the meaning or interpretation of this Amendment.

 

19.          Guarantor Acknowledgement.  Each Guarantor party hereto hereby (i) consents to the modifications to the Credit Agreement contemplated by this Amendment and (ii) acknowledges and agrees that its guaranty pursuant to Section 10.18 of the Credit Agreement is, and shall remain, in full force and effect after giving effect to the Amendment.

 

[SIGNATURE PAGES FOLLOW]

 

5

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

 

	
 
    	
BORROWERS:
    
	
 
    	
 
    	
 
    
	
 
    	
NGL   ENERGY OPERATING LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
NGL   SUPPLY, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
HICKSGAS,   LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
NGL   SUPPLY RETAIL, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
NGL   SUPPLY WHOLESALE, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
NGL   SUPPLY TERMINAL COMPANY, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
OSTERMAN   PROPANE, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
NGL-NE   REAL ESTATE, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
NGL-MA   REAL ESTATE, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
NGL-MA,   LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
NGL-NE,   LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
HIGH   SIERRA ENERGY, LP,
    
	
 
    	
a   Delaware limited partnership
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
GREENSBURG   OILFIELD, LLC,
    
	
 
    	
a   Colorado limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
ANTICLINE   DISPOSAL, LLC,
    
	
 
    	
a   Wyoming limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

 

	
 
    	
HIGH   SIERRA SERTCO, LLC,
    
	
 
    	
a   Colorado limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
HIGH   SIERRA ENERGY MARKETING, LLC,
    
	
 
    	
a   Colorado limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
CENTENNIAL   ENERGY, LLC,
    
	
 
    	
a   Colorado limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
CENTENNIAL   GAS LIQUIDS ULC,
    
	
 
    	
an   Alberta unlimited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
HIGH   SIERRA TRANSPORTATION, LLC,
    
	
 
    	
a   Colorado limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
HIGH   SIERRA CRUDE OIL & MARKETING, LLC, a Colorado limited liability   company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
HIGH   SIERRA WATER SERVICES, LLC,
    
	
 
    	
a   Colorado limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
ANDREWS   OIL BUYERS, INC.,
    
	
 
    	
a   Texas corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   James J. Burke
    
	
 
    	
 
    	
Name:   James J. Burke
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
BORROWERS’   AGENT:
    
	
 
    	
 
    	
 
    
	
 
    	
NGL   ENERGY OPERATING LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
GUARANTORS:
    
	
 
    	
 
    	
 
    
	
 
    	
NGL   ENERGY PARTNERS LP,
    
	
 
    	
a   Delaware limited partnership
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   H. Michael Krimbill
    
	
 
    	
 
    	
Name:   H. Michael Krimbill
    
	
 
    	
 
    	
Title:   Chief Executive Officer
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
DEUTSCHE   BANK TRUST COMPANY AMERICAS, as Administrative Agent and as Collateral Agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Melissa Sadler
    
	
 
    	
 
    	
Name:   Melissa Sadler
    
	
 
    	
 
    	
Title:   Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Renee Cummins
    
	
 
    	
 
    	
Name:   Renee Cummins
    
	
 
    	
 
    	
Title:   Associate
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
DEUTSCHE   BANK AG NEW YORK BRANCH,
    
	
 
    	
as   a Lender, as Swingline Lender, as an Issuing Bank and as Technical Agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Chris Chapman
    
	
 
    	
 
    	
Name:   Chris Chapman
    
	
 
    	
 
    	
Title:   Director
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Juan J. Mejia
    
	
 
    	
 
    	
Name:   Juan J. Mejia
    
	
 
    	
 
    	
Title:   Director
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
ROYAL   BANK OF CANADA,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Kristan Spivey
    
	
 
    	
 
    	
Name:   Kristan Spivey
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
BNP   PARIBAS,
    
	
 
    	
as   a Lender and Issuing Bank
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard J. Wernli
    
	
 
    	
 
    	
Name:   Richard J. Wernli
    
	
 
    	
 
    	
Title:   Managing Director
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Keith Cox
    
	
 
    	
 
    	
Name:   Keith Cox
    
	
 
    	
 
    	
Title:   Managing Director
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
PNC   BANK, NATIONAL ASSOCIATION,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Christopher Hermann
    
	
 
    	
 
    	
Name:   Christopher Hermann
    
	
 
    	
 
    	
Title:   Vice President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

 

	
 
    	
THE   ROYAL BANK OF SCOTLAND PLC,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Sanjay Remond
    
	
 
    	
 
    	
Name:   Sanjay Remond
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
BMO   HARRIS BANK, N.A,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Kimberly A. Yates
    
	
 
    	
 
    	
Name:   Kimberly A. Yates
    
	
 
    	
 
    	
Title:   Director
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
THE   F&M BANK AND TRUST COMPANY,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Julie B. Smith
    
	
 
    	
 
    	
Name:   Julie B. Smith
    
	
 
    	
 
    	
Title:   Senior Vice President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
RAYMOND   JAMES BANK, N.A.,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Scott G. Axelrod
    
	
 
    	
 
    	
Name:   Scott G. Axelrod
    
	
 
    	
 
    	
Title:   Vice President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
ABN   AMRO CAPITAL USA LLC,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Darrell Holley
    
	
 
    	
 
    	
Name:   Darrell Holley
    
	
 
    	
 
    	
Title:   Managing Director
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Casey Lowary
    
	
 
    	
 
    	
Name:   Casey Lowary
    
	
 
    	
 
    	
Title:   Director
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
BANK   OF AMERICA, N.A.,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Michael Clayborne
    
	
 
    	
 
    	
Name:   Michael Clayborne
    
	
 
    	
 
    	
Title:   Assistant Vice President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
BOKF,   NA d/b/a BANK OF OKLAHOMA,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
J. Nick Cooper
    
	
 
    	
 
    	
Name:   J. Nick Cooper
    
	
 
    	
 
    	
Title:   Vice President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
SUNTRUST   BANK,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Carmen Malizia
    
	
 
    	
 
    	
Name:   Carmen Malizia
    
	
 
    	
 
    	
Title:   Vice President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
COMMERCE   BANK, N.A.,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   C. T. Young
    
	
 
    	
 
    	
Name:   C. T. Young
    
	
 
    	
 
    	
Title:   Senior Vice President
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
GOLDMAN   SACHS BANK USA,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Michelle Latzoni
    
	
 
    	
 
    	
Name:   Michelle Latzoni
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

	
 
    	
MAQUARIE   BANK LIMITED,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Andrew McGrath
    
	
 
    	
 
    	
Name:   Andrew McGrath
    
	
 
    	
 
    	
Title:   Executive Director
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Nathan Booker
    
	
 
    	
 
    	
Name:   Nathan Booker
    
	
 
    	
 
    	
Title:   Associate Director
    

 

[Signature Page to Amendment No. 1 to Credit Agreement]

 

 

EXHIBIT I

 

SCHEDULE 1.1A

 

REVOLVING CREDIT COMMITMENTS

 

	
Lender
    	
 
    	
Acquisition
   Revolving
   Commitment
    	
 
    	
Working Capital
   Revolving
   Commitment
    	
 
    	
Total
   Commitments
    	
 
    
	
Deutsche Bank AG, New York Branch
    	
 
    	
$
    	
77,069,805.19
    	
 
    	
$
    	
35,430,194.81
    	
 
    	
$
    	
112,500,000.00
    	
 
    
	
Royal Bank of Canada
    	
 
    	
$
    	
77,069,805.19
    	
 
    	
$
    	
35,430,194.81
    	
 
    	
$
    	
112,500,000.00
    	
 
    
	
PNC Bank, National Association
    	
 
    	
$
    	
68,506,493.51
    	
 
    	
$
    	
31,493,506.49
    	
 
    	
$
    	
100,000,000.00
    	
 
    
	
BNP Paribas
    	
 
    	
$
    	
51,379,870.13
    	
 
    	
$
    	
23,620,129.87
    	
 
    	
$
    	
75,000,000.00
    	
 
    
	
The Royal Bank of Scotland plc
    	
 
    	
$
    	
51,379,870.13
    	
 
    	
$
    	
23,620,129.87
    	
 
    	
$
    	
75,000,000.00
    	
 
    
	
Bank of America, N.A.
    	
 
    	
$
    	
41,103,896.10
    	
 
    	
$
    	
18,896,103.90
    	
 
    	
$
    	
60,000,000.00
    	
 
    
	
BMO Harris Bank N.A.
    	
 
    	
$
    	
34,253,246.75
    	
 
    	
$
    	
15,746,753.25
    	
 
    	
$
    	
50,000,000.00
    	
 
    
	
BOKF, NA d/b/a Bank of Oklahoma
    	
 
    	
$
    	
17,126,623.38
    	
 
    	
$
    	
7,873,376.62
    	
 
    	
$
    	
25,000,000.00
    	
 
    
	
SunTrust Bank
    	
 
    	
$
    	
17,126,623.38
    	
 
    	
$
    	
7,873,376.62
    	
 
    	
$
    	
25,000,000.00
    	
 
    
	
UBS AG, Stamford Branch
    	
 
    	
$
    	
17,126,623.38
    	
 
    	
$
    	
7,873,376.62
    	
 
    	
$
    	
25,000,000.00
    	
 
    
	
ABN AMRO Capital USA   LLC
    	
 
    	
$
    	
17,126,623.38
    	
 
    	
$
    	
7,873,376.62
    	
 
    	
$
    	
25,000,000.00
    	
 
    
	
Raymond James Bank,   N.A.
    	
 
    	
$
    	
17,126,623.38
    	
 
    	
$
    	
7,873,376.62
    	
 
    	
$
    	
25,000,000.00
    	
 
    
	
The F&M Bank and Trust Company
    	
 
    	
$
    	
10,275,974.03
    	
 
    	
$
    	
4,724,025.97
    	
 
    	
$
    	
15,000,000.00
    	
 
    
	
Amegy Bank National   Association
    	
 
    	
$
    	
10,275,974.03
    	
 
    	
$
    	
4,724,025.97
    	
 
    	
$
    	
15,000,000.00
    	
 
    
	
Commerce Bank, N.A.
    	
 
    	
$
    	
6,850,649.35
    	
 
    	
$
    	
3,149,350.65
    	
 
    	
$
    	
10,000,000.00
    	
 
    
	
Goldman Sachs Bank USA
    	
 
    	
$
    	
6,850,649.35
    	
 
    	
$
    	
3,149,350.65
    	
 
    	
$
    	
10,000,000.00
    	
 
    
	
Macquarie Bank Limited
    	
 
    	
$
    	
6,850,649.35
    	
 
    	
$
    	
3,149,350.65
    	
 
    	
$
    	
10,000,000.00
    	
 
    
	
Total   Commitments:
    	
 
    	
$
    	
527,500,000.00
    	
 
    	
$
    	
242,500,000.00
    	
 
    	
$
    	
770,000,000.00Exhibit 4.1

 

STATEMENT WITH RESPECT TO SHARES
 OF SERIES C CONVERTIBLE PREFERRED STOCK
 OF
 PENN NATIONAL GAMING, INC.

 

In compliance with the requirements of Section 1522 of the Business Corporation Law of 1988, P.L. 1444, No. 177 (15 Pa. Cons. Stat Section 1522(c)), the undersigned company, desiring to state the voting rights, designations, preferences, qualifications, privileges, limitations, options, conversion rights, and other special rights, if any, of a class or a series of a class of its shares, HEREBY CERTIFIES THAT:

 

(1) The name of the corporation is Penn National Gaming, Inc. (the “Company”);

 

(2) The resolutions establishing and designating the class or series of shares and fixing and determining the relative rights and preferences thereof are set forth in full in Exhibit 1 attached hereto and made a part hereof;

 

(3) The aggregate number of shares of such class or series established and designated by (i) such resolutions, (ii) all prior statements, if any, filed under Section 1522 of the Business Corporation Law of 1988 or corresponding provisions of prior law with respect thereto, and (iii) any other provision of the Articles of Incorporation of the Company, is 31,000 shares; and

 

(4) The resolutions were adopted by the Board of Directors of the Company at a duly called meeting held on January 14, 2013, and shall be effective after the filing of this statement with respect to shares in the Department of State.

 

IN WITNESS WHEREOF, the Company has caused this statement to be duly executed in its corporate name on this 17th day of January, 2013.

 

	
 
    	
PENN   NATIONAL GAMING, INC.  
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By: 
    	
/s/   Robert S. Ippolito
    
	
 
    	
Name:
    	
Robert   S. Ippolito
    
	
 
    	
Title:
    	
Secretary   and Treasurer
    

 

 

Exhibit 1

 

RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors of the Company in accordance with the provisions of the Articles of Incorporation of the Company, as amended, the Board of Directors hereby creates a series of Preferred Stock, par value $0.01 per share, of the Company (the “Preferred Stock”), and hereby states the designation and number of shares, and fixes the relative rights, preferences, and limitations thereof as follows:

 

Series C Convertible Preferred Stock:

 

Section 1.                                           Designation and Amount.  The shares of such series shall be designated as “Series C Convertible Preferred Stock” (the “Series C Preferred Stock”) and the number of shares constituting the Series C Preferred Stock shall be 18,500.  Such number of shares may be increased or decreased by resolution of the Board of Directors and the requisite filing with the Department of State of the Commonwealth of Pennsylvania; provided, that any such increase shall be limited to the number of authorized and unissued shares of undesignated Preferred Stock; and provided, further, that no decrease shall reduce the number of shares of Series C Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Company, in each case, convertible into Series C Preferred Stock.

 

Section 2.                                           Dividends and Distributions. The holders of record of the issued and outstanding shares of Series C Preferred Stock shall be entitled to receive, out of assets legally available for the payment of dividends, dividends on the terms described below:

 

(A)                               Holders of shares of Series C Preferred Stock shall be entitled to participate equally and ratably with the holders of shares of common stock of the Company (“Common Stock”) in all dividends and distributions paid (whether in the form of cash, stock, other assets, or otherwise, and including, without limitation, any dividend or distribution of shares of stock or other equity, or evidences of indebtedness, of any person, including, without limitation, the Company or any subsidiary, but not including any repurchase of Common Stock or other equity interests in the Company) on the shares of Common Stock, in the amount that such holders would have received if, immediately prior to each record date in respect of which dividends or distributions are paid, each 1/1,000th of a share of Series C Preferred Stock were converted into one share of Common Stock.   Dividends or distributions payable to the holders of shares of Series C Preferred Stock pursuant to this Section 2(A) shall be declared and paid on the same dates that such dividends or distributions are declared and paid, and in the same form payable, to holders of shares of Common Stock.

 

(B)                               Each dividend or distribution payable pursuant to Section 2(A) hereof shall be payable to the holders of record of shares of Series C Preferred Stock as they appear on the stock records of the Company at the close of business on the record date designated by the Board of Directors for such dividends or distributions, which shall be the same day as the record date for the payment of such dividends or distributions to holders

 

2

 

of shares of Common Stock.   In the event the Company shall at any time effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each  such case the amount to which holders of shares of Series C Preferred Stock were entitled immediately prior to such event under Section 2(A) hereof shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

 

Section 3.                                           Voting Rights.

 

(A)                               Except as set forth below or as required by applicable law, the holders of Series C Preferred Stock shall not be entitled to vote at any meeting of the shareholders for election of members of the Board of Directors or for any other purpose or otherwise to participate in any action taken by the Company or the shareholders thereof, or to receive notice of any meeting of shareholders.

 

(B)                               So long as any Series C Preferred Stock remains outstanding, the Company will not, without the affirmative vote or consent of the holders of a majority of the shares of Series C Preferred Stock outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class) amend, alter or repeal the provisions of this Resolution, including by merger or consolidation (an “Event”), so as to adversely affect any right or privilege of the Series C Preferred Stock; provided, however, that no Event shall be deemed to adversely affect the rights and privileges of the Series C Preferred Stock, and the holders thereof shall have no right to vote with respect to such Event, if (x) following such Event, the Series C Preferred Stock remains outstanding with the terms thereof not adversely changed and represent an interest in the same issuer in which holders of Common Stock prior to such Event will hold their shares following such Event or (y) in connection with an Event in which the Company is not the surviving entity, the Series C Preferred Stock is exchanged for a security (a “Replacement Security”) with rights, preferences, privileges and voting powers that are no less favorable than the rights, preferences, privileges and voting powers of the Series C Preferred Stock (it being understood that a Replacement Security shall not be deemed to have rights, preferences, privileges or voting power that are less favorable than the Series C Preferred Stock if the difference in the rights, preferences, privileges or voting power is caused solely by differences between the state law of the jurisdiction of incorporation of the Company and the jurisdiction of incorporation of the issuer of the Replacement Security).

 

(C)                            On each matter submitted to a vote of the holders of Series C Preferred Stock in accordance with this Resolution, or as otherwise required by applicable law, each share of Series C Preferred Stock shall be entitled to one vote. With respect to each share of Series C Preferred Stock, the holder thereof may designate a proxy, with each such proxy having the right to vote on behalf of such holder.

 

Section 4.                                           Reacquired Shares.  Any shares of Series C Preferred Stock duly converted in accordance with this Statement with Respect to Shares or otherwise reacquired by

 

3

 

the Company in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof.  All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock subject to the conditions and restrictions on issuance set forth herein, in the Articles of Incorporation, or in any other Statement with Respect to Shares creating a series of Preferred Stock or any similar stock or as otherwise required by law.

 

Section 5.                                           Liquidation, Dissolution or Winding Up.  Upon any liquidation, dissolution or winding up of the Company, no distribution shall be made (1) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series C Preferred Stock unless, prior thereto, the holders of shares of Series C Preferred Stock shall have received $1.00 per share, plus an amount equal to declared and unpaid dividends and distributions thereon, to the date of such payment, provided that the holders of shares of Series C Preferred Stock shall be entitled to receive an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount to be distributed per share to holders of shares of Common Stock, or (2) to the holders of shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series C Preferred Stock, except distributions made ratably on the Series C Preferred Stock and all such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up.  In the event the Company shall at any time effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the aggregate amount to which holders of shares of Series C Preferred Stock were entitled immediately prior to such event under the proviso in clause (1) of the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

 

Section 6.                                           Consolidation, Merger, etc.  In case the Company shall enter into any consolidation, merger, combination or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series C Preferred Stock shall at the same time be similarly exchanged or changed into an amount per share, subject to the provision for adjustment set forth in the following sentence, equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged.  In the event the Company shall at any time effect a subdivision or combination or consolidation of the outstanding shares of Common Stock, by reclassification or otherwise (except by payment of a dividend in shares of Common Stock), into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series C Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

 

4

 

Section 7.                                           Mandatory Conversion.  If, at any time (such date the “Conversion Date”), any share of Series C Preferred shall be Transferred to any person other than the Company or an Affiliate of the Initial Holder who held such share (such share a “Transferred Share”), each 1/1,000 of a Transferred Share shall automatically convert to one share of Common Stock, effective as of the close of business on the Conversion Date.  In no event shall any Initial Holder or any of its Affiliates be permitted to own the shares of Common Stock issuable upon such conversion. In the event the Company shall at any time, on or prior to the Conversion Date, effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the first sentence of this Section 7 with respect to the number of shares of Common Stock to be issued upon conversion of Series C Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.  For purposes of this Resolution, “Affiliate” means, with respect to any person or entity, any other person or entity directly, or indirectly through one or more intermediaries, controlling, controlled by or under common control with such person or entity; the term “control” (and correlative terms “controlling,” “controlled by” and “under common control with”) means possession of the power, whether by contract, equity ownership or otherwise, to direct the policies or management of a person or entity, and “Transfer” means the sale, transfer, assignment or other disposition of any share of Series C Preferred Stock.

 

Section 8.                                           Conversion Procedures.

 

(A)                               An Initial Holder shall immediately provide written notice to the Company of any Transfer by such Initial Holder of any share of Series C Preferred Stock to a person other than the Company or an Affiliate of such Initial Holder, which notice shall state the number of shares of Series C Preferred Stock subject to the Transfer, the person acquiring such shares and the Conversion Date.

 

(B)                               Effective immediately prior to the close of business on the Conversion Date with respect to any Transferred Share, but subject to the consummation of the Transfer of such share, dividends shall no longer be declared on such Transferred Share and such Transferred Share shall cease to be outstanding.

 

(C)                               Prior to the close of business on the Conversion Date with respect to any Transferred Share, shares of Common Stock issuable upon conversion thereof shall not be deemed outstanding for any purpose, and the holder of such Transferred Share shall have no rights with respect to Common Stock (including voting rights or rights to respond to tender offers for Common Stock) by virtue of holding such Transferred Share.

 

(D)                               The person or persons entitled to receive Common Stock issuable upon conversion of Transferred Shares shall be treated for all purposes as the record holder(s) of such shares of Common Stock as of the close of business on the Conversion Date with respect thereto. In the event that an Initial Holder fails to by written notice designate the name in which shares of Common Stock to be issued upon conversion of Transferred

 

5

 

Shares should be registered in the Company’s transfer records or the manner in which such shares should be delivered, the Company shall not be obligated to register or deliver such shares, until such written notice is provided, and until such time, such shares of Common Stock shall be issued in the name of the Company, which will hold such shares and all distributions thereon in trust for the transferee, subject to reimbursement by the rightful owner for reasonable out-of-pocket expenses incurred in connection therewith.

 

(E)                                As soon as reasonably practicable following the Conversion Date with respect to any Transferred Share, certificates representing shares of Common Stock shall be issued and delivered to the holder thereof or such holder’s designee upon presentation and surrender of the certificate evidencing the Transferred Share to the Company, or in the case of book-entry shares, a book-entry transfer and, if applicable, notice to the Company’s transfer agent, will be made by the Company upon the furnishing of appropriate endorsements and transfer documents and the payment of all transfer and similar taxes, as applicable.

 

Section 9.                                           No Redemption.  The shares of Series C Preferred Stock shall not be redeemable.

 

Section 10.                                    Rank.  The Series C Preferred Stock shall rank junior to any other class of the Company’s Preferred Stock with respect to the payment of dividends and the distribution of assets.

 

Section 11.                                    Destroyed / Lost Certificates.  If any Series C Preferred Stock certificate shall be mutilated, lost, stolen or destroyed, the Company will issue, in exchange and in substitution for and upon cancellation of the mutilated certificate, or in lieu of and substitution for the certificate lost, stolen or destroyed, a new Series C Preferred Stock certificate of like tenor and representing an equivalent amount of Series C Preferred Stock, upon receipt of evidence of such loss, theft or destruction of such certificate and, if requested by the Company, an indemnity on customary terms for such situations reasonably satisfactory to the Company

 

Section 12.                                    Certain Tax Matters.   The Company shall be entitled to deduct and withhold from any payment of cash, shares of Common Stock or other consideration payable to a holder of a share of Series C Preferred Stock, any amounts required to be deducted or withheld under applicable U.S. federal, state, local or foreign tax laws with respect to such payment.  In the event the Company previously remitted withholding taxes to a governmental authority in respect of any amount treated as a distribution on a share of Series C Preferred Stock, the Company shall be entitled to offset any such taxes against any amounts otherwise payable in respect of such share of Series C Preferred Stock.

 

6

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