Document:

Exhibit 4.1

 

EXECUTION VERSION

 

PERMITTED SECURED REFINANCING AGREEMENT

 

This PERMITTED SECURED REFINANCING AGREEMENT (this “Agreement”), dated as of February 23, 2011, is entered into among REGAL CINEMAS CORPORATION, a Delaware corporation (the “Borrower”), the GUARANTORS (as defined in the Credit Agreement referred to below), REGAL ENTERTAINMENT HOLDINGS, INC., a Delaware corporation (“Holdings”), REGAL ENTERTAINMENT GROUP, a Delaware corporation (“Parent”), the LENDERS party hereto, and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as administrative agent (the “Administrative  Agent”).

 

RECITALS

 

WHEREAS, the Borrower, the Administrative Agent and the Lenders from time to time party thereto entered into that certain Sixth Amended and Restated Credit Agreement, dated as of May 19, 2010 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”);

 

WHEREAS, the Borrower, the Guarantors and Grantors party thereto and the Administrative Agent entered into that certain Second Amended and Restated Guaranty and Collateral Agreement, dated as of May 19, 2010 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Guaranty and Collateral Agreement”);

 

WHEREAS, the Borrower will consummate a Permitted Secured Refinancing of the Term Loans outstanding under the Credit Agreement in the amount of $1,006,000,000, and in accordance therewith the Lenders party hereto as Lenders will advance Term Loans in an aggregate principal amount of $1,006,000,000, the proceeds of which will be used, together with other amounts provided by the Borrower, to repay all of the outstanding principal and accrued and unpaid interest on all of the Term Loans under the Credit Agreement in effect immediately prior to the making of Term Loans pursuant to the Permitted Secured Refinancing contemplated hereby (such existing Term Loans, the “Existing Term Loans”; and such repayment, the “Refinancing”);

 

WHEREAS, concurrently with the Refinancing, Parent, Holdings, the Borrower, the Guarantors, the Lenders party hereto and the Administrative Agent will make certain amendments to the Credit Agreement and the Guaranty and Collateral Agreement as provided herein;

 

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

 

SECTION 1.                                Definitions.  Except as expressly provided herein, capitalized terms used in this Agreement but not defined in this Agreement shall have the meanings set forth for such terms in the Credit Agreement.

 

SECTION 2.                                Permitted Secured Refinancing.

 

(a)                                  After giving effect to the Refinancing, pursuant to which the Term Loans shall be refinanced with loans made under Section 6.2(j) of the Credit Agreement (the “Refinancing Term Loans”), the Lenders providing such Refinancing Term Loans shall be the only Lenders under the Credit Agreement holding Term Loan Exposure.

 

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(b)                                 The Lenders listed on Schedule I shall advance an aggregate amount of $1,006,000,000 as Refinancing Term Loans pursuant to the terms and conditions hereof, in the amounts, (with respect to each Lender listed on Schedule I hereto) set forth opposite its name on Schedule I hereto.

 

(c)                                  The terms of the Refinancing Term Loans shall be as set forth for Term Loans in the Credit Agreement, as amended by this Agreement.

 

SECTION 3.                                Joinder to Credit Agreement. Each Lender listed on Schedule I acknowledges and agrees that, upon the effectiveness of this Agreement, it shall become a “Lender” under, and for all purposes of, the Credit Agreement and the other Loan Documents, and shall be subject to and bound by the terms thereof; and shall perform all the obligations of and shall have all rights of a Lender thereunder.

 

SECTION 4.                           Amendments to Credit Agreement.

 

(a)                                  Amendments to Section 1.1: Definitions.  Section 1.1 of the Credit Agreement is hereby amended in the following respects:

 

(i)                                     Section 1.1 of the Credit Agreement is hereby amended by inserting the following new definitions therein in the appropriate alphabetical order:

 

“First Amendment” means that certain Permitted Secured Refinancing Agreement, dated as of February 23, 2011, by and among Parent, Holdings, the Borrower, the Guarantors, the Lenders party thereto  and the Administrative Agent.

 

“First Amendment Effective Date” means February 23, 2011.

 

“Repricing Transaction” means (i) the prepayment or refinancing of all or a portion of the Term Loans with the incurrence by Parent, Borrower or any of their respective Subsidiaries of any long-term bank debt financing incurred for the primary purpose of repaying, refinancing, substituting or replacing the Term Loans and having an effective interest cost or weighted average yield (as reasonably determined by the Administrative Agent consistent with generally accepted financial practice and, in any event, excluding any arrangement or commitment fees in connection therewith) that is less than the interest rate for or weighted average yield (as reasonably determined by the Administrative Agent on the same basis) of the Term Loans, or (ii) any amendment to this Agreement or any other Loan Document relating to the interest rate for, or weighted average yield of, the Term Loans which has the effect of lowering the interest cost or weighted average yield (as reasonably determined by the Administrative Agent consistent with generally accepted financial practice and, in any event, excluding any arrangement or commitment fees in connection therewith) of the Term Loans from that in effect on the First Amendment Effective Date; at the request of the Borrower, the Administrative Agent shall provide to the Borrower such determinations.

 

(ii)                                  The definition of “Applicable Margin” is hereby amended by deleting such definition in its entirety and replacing it with the following:

 

““Applicable Margin” means (i) with respect to Term Loans (other than New Term Loans) a percentage, per annum, determined by reference to the Consolidated Leverage Ratio (calculated on a pro forma basis to give effect to all New Term Loans drawn since the most recent calculation of the Consolidated Leverage Ratio, any repayments of Indebtedness made with such New Term Loans and any use of the proceeds of such New Term Loans for Permitted Acquisitions) in effect from time to time as set forth below, (ii) with respect to Revolving Loans, a percentage, per annum, determined by reference to the Consolidated Leverage Ratio (calculated on a pro forma basis to give effect to all New Term Loans drawn since the most recent calculation of the Consolidated Leverage Ratio, any repayments of Indebtedness made with such New Term Loans and any

 

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use of the proceeds of such New Term Loans for Permitted Acquisitions) in effect from time to time as set forth below and (iii) with respect to Loans that are New Term Loans, the Applicable Margin shall be as provided for in the Joinder Agreement relating to the New Term Loan Commitment in respect of such New Term Loan.

 

	
Consolidated
   Leverage
   Ratio
    	
 
    	
Applicable
   Margin for
   Eurodollar
   Rate
   Revolving
   Loans
    	
 
    	
Applicable
   Margin for
   ABR Rate
   Revolving
   Loans
    	
 
    	
Applicable
   Margin for
   Eurodollar
   Rate
   Term Loans
    	
 
    	
Applicable
   Margin for
   ABR Rate
   Term Loans
    	
 
    
	
> 3.00:1.00
    	
 
    	
3.75
    	
%
    	
2.75
    	
%
    	
3.25
    	
%
    	
2.25
    	
%
    
	
< 3.00:1.00
    	
 
    	
3.50
    	
%
    	
2.50
    	
%
    	
3.00
    	
%
    	
2.00
    	
%
    

 

No change in the Applicable Margin shall be effective until three Business Days after the date on which Administrative Agent shall have received the applicable financial statements and a Compliance Certificate calculating the Consolidated Leverage Ratio; provided that notwithstanding the foregoing, a change in the Applicable Margin as a result of a change to the Consolidated Leverage Ratio resulting from the pro forma effect of a drawing of New Term Loans as provided above shall be given effect one Business Day following any such drawing of New Term Loans.  At any time Borrower has not submitted to Administrative Agent the applicable information as and when required, the Applicable Margin shall be determined as if the Consolidated Leverage Ratio were in excess of 3.00:1.00.  Promptly after receipt of the applicable information under Section 5.2(b), Administrative Agent shall give each Lender notice of the Applicable Margin in effect from such date.  As of the First Amendment Effective Date, the Applicable Margin shall be based on a Consolidated Leverage Ratio in excess of 3.00:1.00.”

 

(iii)                               The definition of “Existing Title Policy” is hereby amended by deleting such definition in its entirety and replacing it with the following:

 

““Existing Title Policy” means each of the mortgagee’s title insurance policies that were issued pursuant to the terms of the Original Credit Agreement, the Restated Credit Agreement, the Second Restated Credit Agreement, the Third Restated Credit Agreement, the Fourth Restated Credit Agreement, the Fifth Restated Credit Agreement or the Credit Agreement.”

 

(iv)                              The definition of “Term Loan” is hereby amended by deleting such definition in its entirety and replacing it with the following:

 

““Term Loan” means a loan made by a Lender to Borrower pursuant to Section 2.1, the Existing Term Loans and any loans constituting a Permitted Secured Refinancing of Term Loans.  The aggregate outstanding principal amount of the Term Loans on the Closing Date is $1,250,000,000. The aggregate outstanding principal amount of the Term Loans on the First Amendment Effective Date is $1,006,000,000.”

 

(v)                                 The definition of “Term Loan Maturity Date” is hereby amended by deleting such definition in its entirety and replacing it with the following:

 

““Term Loan Maturity Date” means the earlier of (i) August 23, 2017, and (ii) the date on which all Term Loans shall become due and payable in full hereunder, whether by acceleration or otherwise.”

 

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(b)                                 Amendments to Section 2: Loans and Letters of Credit.

 

(i)                                     Section 2.1(b) of the Credit Agreement is hereby amended by inserting the following at the end of such Section:

 

(ii)                                  The Interest Period on each Term Loan made under Section 6.2(j) on the First Amendment Effective Date (a “Refinancing Eurodollar Rate Loan”) shall continue from the commencement date of the Interest Period applicable to Term Loans under this Agreement immediately prior to the First Amendment Effective Date to the day such Interest Period was scheduled to expire immediately prior to giving effect to the First Amendment.  Interest payable pursuant to Section 2.7(a) on Refinancing Eurodollar Rate Loans that are continued as Eurodollar Rate Loans shall, solely until the expiration of the Interest Period applicable thereto which commenced prior to the First Amendment Effective Date, be computed with reference to the same Adjusted Eurodollar Rate used to compute the interest payable on Term Loans as in effect under this Agreement immediately prior to the effectiveness of the First Amendment.

 

(ii)                                  Section 2.11 of the Credit Agreement is hereby amended by deleting such Section in its entirety and replacing it with the following:

 

“Section 2.11                      Scheduled Payments.  The principal amounts of the Term Loans of each Lender (other than New Term Loans, for which scheduled payments shall be made as provided for in the Joinder Agreement relating to such New Term Loan) shall be repaid in consecutive quarterly installments (each, an “Installment”) in an amount equal to such Lender’s Pro Rata Share (determined with respect to Term Loans other than New Term Loans) of the aggregate amounts set forth below on the last Business Day of each calendar quarter (each, an “Installment Date”), commencing March 31, 2011:

 

	
Installment Date
    	
 
    	
Installment
    	
 
    
	
March 31, 2011
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
June 30, 2011
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
September 30, 2011
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
December 31, 2011
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
March 31, 2012
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
June 30, 2012
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
September 30, 2012
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
December 31, 2012
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
March 31, 2013
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
June 30, 2013
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
September 30, 2013
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
December 31, 2013
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
March 31, 2014
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
June 30, 2014
    	
 
    	
$
    	
2,515,000.00
    	
 
    

 

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Installment Date
    	
 
    	
Installment
    	
 
    
	
September 30, 2014
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
December 31, 2014
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
March 31, 2015
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
June 30, 2015
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
September 30, 2015
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
December 31, 2015
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
March 31, 2016
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
June 30, 2016
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
September 30, 2016
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
December 31, 2016
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
March 31, 2017
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
June 30, 2017
    	
 
    	
$
    	
2,515,000.00
    	
 
    
	
Term Loan Maturity Date
    	
 
    	
$
    	
940,610,000.00
    	
 
    

 

Notwithstanding the foregoing, (x) such Installments shall be reduced in connection with any voluntary or mandatory prepayments of the Term Loans, as the case may be, in accordance with Sections 2.12, 2.13 and 2.14, as applicable; and (y) the Term Loans, together with all other amounts owed hereunder with respect thereto, shall, in any event, be paid in full no later than the Term Loan Maturity Date.”

 

(iii)                               Section 2 of the Credit Agreement is hereby amended by inserting the following at the end of such Section:

 

“2.21                  Repricing Protection.                          In the event that, after the First Amendment Effective Date, but on or prior to the first anniversary thereof, any Repricing Transaction occurs, the Borrower shall pay to the Administrative Agent, for the ratable account of each of the applicable Lenders holding Term Loans, (A) in the case of a prepayment or refinancing constituting a Repricing Transaction a premium of 1.0% of the aggregate amount of the Term Loans being prepaid and (B) in the case of an amendment constituting a Repricing Transaction, a payment equal to 1.0% of the aggregate amount of the applicable Term Loans outstanding immediately prior to such amendment. As a condition to effectiveness of any required assignment by any Nonconsenting Lender of its Term Loans pursuant to Section 2.20 in respect of any amendment, amendment and restatement or modification to this Agreement effective prior to the first anniversary of the First Amendment Effective Date that has the effect of reducing the Applicable Margin for any Term Loans from the Applicable Margin in effect on the First Amendment Effective Date, the Borrower shall pay to such Nonconsenting Lender its ratable portion of such payment referred to in clause (B) above. For purposes of clarity, the Borrower shall have no obligation to make any such payment referred to in clause (B) above to any Replacement Lender that is assigned such Nonconsenting Lender’s Term Loans pursuant to Section 2.20.”

 

(c)                                  Amendment to Section 6.8: Investments.  Immediately following the effectiveness of the Refinancing, Section 6.8 of the Credit Agreement is hereby amended in the following respects:

 

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(i)                                     Section 6.8 of the Credit Agreement is hereby amended by inserting the following at the end of such Section:

 

“Notwithstanding anything to the contrary contained herein, Borrower shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly purchase, own or carry Margin Stock; provided that,  (i) Borrower and its Restricted Subsidiaries may carry or own Margin Stock carried or owned by the Borrower and its Restricted Subsidiaries as of the First Amendment Effective Date and (ii) Borrower and its Restricted Subsidiaries may acquire additional Margin Stock so long as the consideration paid therefor does not exceed $50,000,000.00 in the aggregate.”

 

SECTION 5.                           Amendments to Guaranty and Collateral Agreement.

 

(a)                                  Amendment to Section 3.2: Certain Limited Exclusions.  Immediately following the effectiveness of the Refinancing, Section 3.2 of the Guaranty and Collateral Agreement is hereby amended by (i) deleting the word “or” at the end of clause (d) thereof , (ii) inserting the following in replacement therefor: “;” and (iii) inserting the following at the end of clause (d) thereof: “or (e) any Margin Stock.”

 

SECTION 6.                           Conditions to Effectiveness of this Agreement.  This Agreement, and, for the avoidance of doubt, the Refinancing contemplated hereunder, shall become effective when all the conditions set forth in this Section 3 shall have been satisfied (provided that such conditions are satisfied no later than February 23, 2011) (the date such conditions are satisfied being the “Agreement Effective Date”).

 

(a)                                  Execution of Counterparts. The Administrative Agent shall have executed the Agreement, in its capacity as Administrative Agent, and shall have received (i) counterparts of this Agreement executed by Parent, Holdings, the Borrower and each Guarantor and (ii) counterparts of this Agreement executed by each Lender party hereto.

 

(b)                                 Satisfaction of Credit Suisse.  Credit Suisse shall be satisfied that after giving effect to the Refinancing Term Loans, repayment of all Existing Term Loans and payment of all accrued and unpaid interest on the Existing Term Loans, the principal amount of Term Loans outstanding under the Credit Agreement shall not exceed $1,006,000,000.

 

(c)                                  Organizational Documents; Incumbency.  Administrative Agent shall have received (i) a copy of each Organizational Document of Borrower, and, to the extent applicable, certified as of a recent date by the appropriate governmental official, dated the Agreement Effective Date or a recent date prior thereto; (ii) signature and incumbency certificates of the officers of Borrower executing this Agreement and the other Loan Documents executed as of the Agreement Effective Date to which it is a party; (iii) resolutions of the board of directors or similar governing body of Borrower approving and authorizing the execution, delivery and performance of this Agreement and the other Loan Documents executed as of the Agreement Effective Date to which it is a party or by which it or its assets may be bound as of the Agreement Effective Date, certified as of the Agreement Effective Date by its secretary or an assistant secretary as being in full force and effect without modification or amendment; (iv) such good standing certificates as Administrative Agent may request from the applicable Governmental Authority of Borrower’s jurisdiction of incorporation, dated a recent date prior to the Agreement Effective Date; and (v) such other documents as Administrative Agent may reasonably request.

 

(d)                                 Fees.  The Lenders and the Administrative Agent (and their respective Affiliates) shall have received all fees required to be paid to the Administrative Agent or its affiliates, and all expenses (including the reasonable fees and expenses of legal counsel) for which invoices have been presented, on or before the Agreement Effective Date.

 

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(e)                                  Opinions of Counsel to Loan Parties, Parent and Holdings.  Administrative Agent and Lenders shall have received an originally executed copy of the written opinion of Hogan Lovells US LLP, counsel for the Loan Parties as to such matters as Administrative Agent may reasonably request, dated as of the Agreement Effective Date and in form and substance reasonably satisfactory to Administrative Agent.

 

(f)                                    Mortgage Amendments and Related Documentation.  Administrative Agent shall have received flood hazard certificates with respect to each owned Mortgaged Property and, if such Mortgaged Property is a Flood Hazard Property, evidence of flood insurance with respect to each such Mortgaged Property that is located in a community that participates in the National Flood Insurance Program, in compliance with any applicable regulations of the Board of Governors of the Federal Reserve System, in form and substance reasonably satisfactory to Administrative Agent.

 

(g)                                 Agreement Effective Date Certificate.  Borrower shall have delivered to Administrative Agent an originally executed Agreement Effective Date Certificate, substantially in the form attached hereto as Exhibit B, together with all attachments thereto.

 

(h)                                 Agreement Effective Date Representations and Warranties.

 

a.               As of the Agreement Effective Date, the representations and warranties contained herein, in the Credit Agreement and in the other Loan Documents shall be true and correct in all material respects on and as of the Agreement Effective Date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date.

 

b.              As of the Agreement Effective Date, no event shall have occurred and be continuing or would result from the consummation of the transactions contemplated by this Agreement on the Agreement Effective Date that would constitute an Event of Default or a Default (each as defined in the Credit Agreement).

 

SECTION 7.                           Representations and Warranties.  Parent, Holdings, the Borrower and each other Loan Party represents and warrants as follows:

 

(a)                                  Power; Authorization; Enforceable Obligations. Parent, Holdings, the Borrower and each other Loan Party has the requisite power and authority, and the legal right, to enter into this Agreement.  Parent, Holdings, the Borrower and each other Loan Party has taken all necessary corporate or other organizational action to authorize the execution, delivery and performance of this Agreement.  This Agreement constitutes a legal, valid and binding obligation of Parent, Holdings, the Borrower and each other Loan Party signatory hereto and thereto, enforceable against Parent, Holdings, the Borrower and each other Loan Party in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).  The Credit Agreement, as amended by this Agreement, and each other Loan Document constitutes a legal, valid and binding obligation of Parent, Holdings, the Borrower and each other Loan Party, in each case, to the extent party to such Loan Document, enforceable against the Parent, Holdings, the Borrower and each other Loan Party in accordance with their terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).

 

(b)                                 No Legal Bar. The execution, delivery and performance of this Agreement will not violate any Requirement of Law or any material Contractual Obligation of Parent, Holdings, the Borrower and each other Loan Party, nor result in, or require, the creation or imposition of any Lien on any of their respective properties

 

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or revenues pursuant to any Requirement of Law or any such Contractual Obligation (other than the Liens created by the Loan Documents).

 

(c)                                  Accuracy of Representations and Warranties. The representations and warranties of each Parent, Holdings, the Borrower and each other Loan Party set forth in the Loan Documents (including, for avoidance of doubt, in the Credit Agreement) are true and correct in all material respects on and as of the date hereof to the same extent as though made on and as of the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date.

 

(d)                                 No Default or Event of Default. As of the date hereof, after giving effect to this Agreement, no event has occurred and is continuing that would constitute an Event of Default or a Default.

 

SECTION 8.                           Post Closing Obligations.  On or prior to 60 days following the Agreement Effective Date, or such longer period as may be agreed by Administrative Agent in its sole and absolute discretion, Administrative Agent shall have received the following:

 

(a)                                  a duly executed and acknowledged amendment to each Existing Mortgage substantially in the form attached hereto as Exhibit A; and

 

(b)                                 ALTA 11 mortgage modification endorsements with respect to each owned Mortgaged Property in each jurisdiction where such endorsement is commercially available or, to the extent not commercially available, other title endorsements reasonably specified by Administrative Agent for each such Mortgaged Property (to the extent commercially available at a cost reasonably determined by the Administrative Agent not to be in excess of the value of such endorsement) confirming that the Existing Title Policies covering such properties will not be impaired or affected in any adverse respect by the transactions contemplated by this Agreement.

 

SECTION 9.                           Validity of Obligations and Liens.

 

(a)                                  Validity of Obligations.  Parent, Holdings, the Borrower and each other Loan Party acknowledges and agrees that, both before and after giving effect to this Agreement, the Borrower and each other Loan Party (and, (i) as provided in the Guaranty and Pledge Agreement, Holdings and (ii) as provided in the Parent Guaranty, Parent) is, jointly and severally, indebted to the Lenders and the other Secured Parties for the Obligations, without defense, counterclaim or offset of any kind and Parent, Holdings, the Borrower and each other Loan Party hereby ratifies and reaffirms the validity, enforceability and binding nature of such Obligations.

 

(b)                                 Validity of Guarantees.  Parent, Holdings and each Guarantor hereby (i) acknowledges and agrees to the terms of this Agreement and (ii) confirms and agrees that, its guarantee under the Guaranty and Collateral Agreement (or (i) in the case of Holdings, under the Guaranty and Pledge Agreement or (ii) in the case of Parent, under the Parent Guaranty) is, and shall continue to be, in full force and effect, and shall apply to all Obligations and such guarantee is hereby ratified and confirmed in all respects.

 

(c)                                  Validity of Liens and Credit Documents.  Holdings, the Borrower and each other Loan Party hereby ratifies and reaffirms the validity and enforceability (without defense, counterclaim or offset of any kind) of the Liens and security interests granted to the Administrative Agent for the benefit of the Secured Parties to secure any of the Obligations by Holdings, the Borrower or any other Loan Party pursuant to the Loan Documents to which any of Holdings, the Borrower or any other Loan Party is a party and hereby confirms and agrees that notwithstanding the effectiveness of this Agreement, and except as expressly amended by this Agreement, each such Loan Document is, and shall continue to be, in full force and effect and each is hereby

 

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ratified and confirmed in all respects, except that, on and after the effectiveness of this Agreement, each reference in the Loan Documents to the “Credit Agreement”, “thereunder”, “thereof” (and each reference in the Credit Agreement to this “Agreement”, “hereunder” or “hereof”) or words of like import shall mean and be a reference to the Credit Agreement as amended by this Agreement.

 

SECTION 10.                     Lender Consent and Authorization to Amend Other Loan Documents.  Each of the Lenders hereby consents to, and authorizes Parent, Holdings, the Borrower, each other Loan Party and the Administrative Agent to enter into such amendments, restatements, amendment and restatements, supplements and modifications to the Notes, the Guaranty and Collateral Agreement, the Guaranty and Pledge Agreement, the Parent Guaranty, the Intellectual Property Security Agreement, the Control Agreements and the other Security Documents and Loan Documents as the Administrative Agent deems reasonably necessary or desirable in connection with this Agreement.

 

SECTION 11.                     Governing Law.  This Agreement shall be governed by, and shall be construed and enforced in accordance with, the laws of the State of New York.

 

SECTION 12.                     Execution in Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of this Agreement by telecopier or electronic image scan transmission (e.g., PDF via electronic mail) shall be effective as delivery of an original executed counterpart of this Agreement.

 

SECTION 13.                     Execution of Agreement.  This Agreement shall be executed by Parent, Holdings, the Borrower, each Guarantor under the Credit Agreement, the Administrative Agent, in its capacity as Administrative Agent under the Credit Agreement and the Lenders party hereto.  Execution of the Agreement by any Person constitutes the agreement of such Person to the terms of (and results in such Person being bound by) the Agreement.

 

SECTION 14.  Severability.  In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

 

SECTION 15.  Integration.  This Agreement, the Credit Agreement, the other Loan Documents and any separate letter agreements among the Borrower and the Administrative Agent or its affiliates or any other agent party to the Credit Agreement relating to this Agreement or with respect to fees payable to the Administrative Agent (or its affiliates) or such other agents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.

 

SECTION 16.  No Discharge.  This Agreement shall not discharge or release the priority of any Loan Document or any other security therefor.  Nothing herein contained shall be construed as a substitution or novation of the instruments, documents and agreements securing the Obligations, which shall remain in full force and effect.  Nothing in this Agreement shall be construed as a release or other discharge of Parent, Holdings, the Borrower or any other Loan Party from any of its obligations and liabilities under the Credit Agreement or the other Loan Documents (other than the Existing Term Loans after giving effect to the Refinancing contemplated hereby), all of which are continued on the terms set forth in the Credit Agreement.

 

SECTION 17.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF

 

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OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

SECTION 18.                          Headings.  Section and subsection 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 or be given any substantive effect.

 

SECTION 19.                          Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the Parent, Holdings, the Borrower and each other Loan Party party hereto and their respective successors and assigns, and upon the Administrative Agent and the Lenders and each of their respective successors and assigns.  Neither the Parent’s, Holdings’, the Borrower’s nor any other Loan Parties’ rights and obligations hereunder and any interest therein may be assigned or delegated by Parent, Holdings, the Borrower or any other Loan Party without the prior written consent of all Lenders.

 

[signature pages follow]

 

10

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

 

	
 
    	
PARENT:
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
REGAL ENTERTAINMENT GROUP
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
By:
    	
/s/   David H. Ownby
    
	
 
    	
 
    	
 
    	
Name:   David H. Ownby
    
	
 
    	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
HOLDINGS:
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
REGAL ENTERTAINMENT HOLDINGS, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
By:
    	
/s/   David H. Ownby
    
	
 
    	
 
    	
 
    	
Name:   David H. Ownby
    
	
 
    	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
BORROWER:
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
REGAL CINEMAS CORPORATION
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
By:
    	
/s/   David H. Ownby
    
	
 
    	
 
    	
 
    	
Name:   David H. Ownby
    
	
 
    	
 
    	
 
    	
Title:   Chief Financial Officer
    

 

 

[Regal Cinemas Corporation — Permitted Secured Refinancing Agreement]

 

 

	
GUARANTORS:
    
	
 
    	
 
    
	
 
    	
A 3   THEATRES OF TEXAS, INC.
    
	
 
    	
A 3   THEATRES OF SAN ANTONIO, LTD.,
    
	
 
    	
by: A3 THEATRES OF TEXAS, INC., ITS   GENERAL PARTNER
    
	
 
    	
CONSOLIDATED   THEATRES MANAGEMENT, L.L.C.
    
	
 
    	
EASTGATE   THEATRE, INC.
    
	
 
    	
EDWARDS   THEATRES, INC.
    
	
 
    	
FREDERICK   PLAZA CINEMA, INC.
    
	
 
    	
HOYTS   CINEMAS CORPORATION
    
	
 
    	
INTERSTATE   THEATRES CORPORATION
    
	
 
    	
R.C.   COBB II, LLC
    
	
 
    	
R.C.   COBB, INC.
    
	
 
    	
RCI/FSSC,   LLC
    
	
 
    	
RCI/RMS,   LLC
    
	
 
    	
REGAL   CINEMAS HOLDINGS, INC.
    
	
 
    	
REGAL   CINEMAS II, LLC
    
	
 
    	
REGAL   CINEMEDIA CORPORATION,
    
	
 
    	
REGAL GALLERY PLACE, LLC
    
	
 
    	
REGAL   INVESTMENT COMPANY
    
	
 
    	
RICHMOND   I CINEMA, L.L.C.
    
	
 
    	
UA   SWANSEA, LLC
    
	
 
    	
UNITED   ARTISTS PROPERTIES I CORP.
    
	
 
    	
UNITED   ARTISTS REALTY COMPANY
    
	
 
    	
UNITED   ARTISTS THEATRE COMPANY
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   David H. Ownby
    
	
 
    	
 
    	
Name:   David H. Ownby
    
	
 
    	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
REGAL   CINEMAS, INC.
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   David H. Ownby
    
	
 
    	
 
    	
Name:   David H. Ownby
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    

 

 

[Regal Cinemas Corporation — Permitted Secured Refinancing Agreement]

 

 

	
 
    	
CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH
    
	
 
    	
as   Administrative Agent, and as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Christopher Ree Day
    
	
 
    	
 
    	
 
    	
Name:
    	
Christopher   Ree Day
    
	
 
    	
 
    	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Kevin Buddhdew
    
	
 
    	
 
    	
 
    	
Name:
    	
Kevin   Buddhdew
    
	
 
    	
 
    	
 
    	
Title:
    	
Associate
    

 

 

[Regal Cinemas Corporation — Permitted Secured Refinancing Agreement]

 

 

SCHEDULE I

 

REFINANCING TERM LOANS

ON THE FIRST AMENDMENT EFFECTIVE DATE

 

	
LENDER
    	
 
    	
TERM LOAN AMOUNT
   ($)
    	
 
    	
TERM LOAN
   PERCENTAGE (%)
    	
 
    
	
Credit   Suisse AG, Cayman Islands Branch
    	
 
    	
$
    	
1,006,000,000
    	
 
    	
100
    	
%
    
							

 

 

EXHIBIT A

 

FORM OF

AMENDMENT TO EXISTING MORTGAGE

 

 

 

Amendment to Deed of Trust,

Assignment of Leases and Rents, Security Agreement and Fixture Filing

 

[                                                                      ]

as Grantor

 

in favor of

[                                                                      ]

as trustee

 

for the benefit of

 

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH

as Administrative Agent

 

as Beneficiary

 

Dated as of                          , 2011

 

Property Address:

 

[                                    ]

 

 

RECORD AND RETURN TO:

CHRISTINA SCHMIDT

Skadden, Arps, Slate, Meagher & Flom LLP

300 South Grand Avenue, Suite 3400

Los Angeles, CA  90071

 

 

THIS Amendment to Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, (this “Amendment”) is executed as of                                  , 2011 by [                                                                      ] (“Grantor”) whose address is 7132 Mike Campbell Dr., Knoxville, TN  37198, to [                                                                      ] (“Trustee”), whose address is[                                                                      ], for the benefit of CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH (formerly known as Credit Suisse First Boston), as Administrative Agent (“Beneficiary”) for the Lenders under the Credit Agreement more fully described and defined below, whose address is 11 Madison Avenue, New York, NY  10010-3629.

 

RECITALS

 

WHEREAS, that certain Credit Agreement dated as of January 29, 2002 was entered into by and among Regal Cinemas Corporation and Regal Cinemas, Inc., as borrower, the Several Lenders from time to time party thereto; Lehman Brothers, Inc. as sole advisor, sole lead arranger and sole book manager; Lehman Commercial Paper Inc., as administrative agent (“Assignor”), and the other Agents referred to therein (the “Original Credit Agreement”);

 

WHEREAS, that certain Guarantee and Collateral Agreement dated as of January 29, 2002 was entered into by and among Regal Cinemas Corporation, Regal Cinemas, Inc. and each of the Guarantors (as defined therein) (the “Original Guarantee and Collateral Agreement”);

 

WHEREAS, pursuant to the terms of the Original Credit Agreement, Grantor did grant to Trustee, for the benefit of Assignor that certain Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing (as the same has been amended from time to time, the “Deed of Trust”) upon the Mortgaged Property, as defined therein, which Deed of Trust (l) was recorded in the land records of that certain jurisdiction within which the Mortgaged Property is located, which recording information is set forth in Exhibit A attached hereto and made a part hereof and (2) encumbers, inter  alia, the real property described in Exhibit A attached hereto and made a part hereof;

 

WHEREAS, the Original Credit Agreement was amended and restated (a) pursuant to that certain Amended and Restated Credit Agreement dated as of August 12, 2002 (the “First Amendment”); (b) again pursuant to that certain Second Amended and Restated Credit Agreement dated as of June 6, 2003 (the “Second Amendment”), (c) again pursuant to that certain Third Amended and Restated Credit Agreement dated as of August 27, 2003 (the “Third Amendment”), (d) again pursuant to that certain Fourth Amended and Restated Credit Agreement dated as of May 10, 2004 (the “Fourth Amendment”), (e) again pursuant to that certain Fifth Amended and Restated Credit Agreement dated as of October 27, 2006 (as amended by the First Amendment, dated as of January 20, 2009) (the “Fifth Amendment”), (f) again pursuant to that certain Sixth Amended and Restated Credit Agreement dated as of May 19, 2010 (the “Sixth Amendment”), and (g) again pursuant to that certain Permitted Secured Refinancing Agreement dated as of February [    ], 2011 (the “February 2011 Supplement”);

 

2

 

WHEREAS, the Original Guarantee and Collateral Agreement was amended pursuant to that certain (a) Confirmation and Amendment Agreement dated as of August 12, 2002 (the “First Guarantee Amendment”); (b) again pursuant to that certain Confirmation and Amendment to Guarantee and Collateral Agreement dated as of June 6, 2003 (the “Second Guarantee Amendment”), (c) again pursuant to that certain Confirmation and Amendment to Guarantee and Collateral Agreement dated as of August 27, 2003 (the “Third Guarantee Amendment”), (d) again pursuant to that certain Amended and Restated Guarantee and Collateral Agreement dated as of May 10, 2004 (the “Fourth Guarantee Amendment”), and (e) again pursuant to that certain Second Amended and Restated Guarantee and Collateral Agreement dated as of May 19, 2010 (the “Fifth Guarantee Amendment”);

 

WHEREAS, pursuant to the Assignment of Beneficiary’s Interest (the “Assignment”), dated as of [              ], 2004, Assignor did assign, convey, transfer and sell to Beneficiary, its successors and assigns all of Assignor’s right, title and interest in the Deed of Trust, without recourse; and

 

WHEREAS, Grantor and Trustee and Beneficiary hereby desire to amend the Deed of Trust in order to provide notice of record (a) of the existence of the February 2011 Supplement and (b) that the Deed of Trust now secures the Obligations under and as defined in the February 2011 Supplement, as it may be amended, modified, restated, consolidated, extended, renewed and replaced from time to time.

 

NOW THEREFORE, for Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and in consideration of the mutual covenants herein set forth, the parties hereto agree to amend the Deed of Trust as follows:

 

1.             The foregoing recitals to this Amendment are hereby incorporated in and made a part of this Amendment to the same extent as if set forth in full herein.

 

2.             Wherever used in the Deed of Trust or hereafter in this Amendment, the term “Credit Agreement” means the February 2011 Supplement, as it may be amended, modified, restated, consolidated, extended, revised or replaced from time to time.

 

3.             The parties hereto acknowledge and agree that the amendments made by this Amendment are in no way intended, nor shall they be deemed to modify, alter or change the priority of the lien of the Deed of Trust.  The Deed of Trust, as hereby amended, is hereby ratified and confirmed in all respects.  From and after the date hereof, (a) the term Mortgage, as such term is used in the February 2011 Supplement, shall be deemed to include this Amendment, and (b) the term “Deed of Trust” as such term is used in the Deed of Trust shall mean the Deed of Trust as amended by this Amendment.

 

4.             The parties acknowledge that the Trustee is executing this Amendment for the sole purpose of consenting to the terms hereof.

 

3

 

5.             This Amendment may be executed in any number of multiple counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same instrument.

 

6.             This Amendment shall be governed by the laws of the state in which the Mortgaged Property is located.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

4

 

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above written

 

 

	
 
    	
 
    	
GRANTOR:
    
	
 
    	
 
    	
 
    
	
Witnessed:
    	
 
    	
[                                                                              ]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    	
(Seal)
    
	
Name:
    	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
TRUSTEE:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
[                                                                              ]
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
Name:
    	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
BENEFICIARY:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
CREDIT   SUISSE AG, CAYMAN ISLANDS BRANCH
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
Name:
    	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
Name:
    	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

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STATE OF                                       §

COUNTY OF                                   §

 

This instrument was acknowledged before me on                                            , 2011, by                                   ,                                          of [                                                                              ], on behalf of said corporation.

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notary Public,   State of
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
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STATE OF                                       §

COUNTY OF                                   §

 

This instrument was acknowledged before me on                                            , 2011, by                                   ,                                          of [                                                                              ], on behalf of said corporation.

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notary Public,   State of
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
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STATE OF                                       §

COUNTY OF                                   §

 

This instrument was acknowledged before me on                                            , 2011, by                                   ,                                          of Credit Suisse AG, Cayman Islands Branch, on behalf of said corporation.

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notary Public,   State of
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
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STATE OF                                       §

COUNTY OF                                   §

 

This instrument was acknowledged before me on                                            , 2011, by                                   ,                                          of Credit Suisse AG, Cayman Islands Branch, on behalf of said corporation.

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notary Public,   State of
    
	
 
    	
 
    	
 
    
	
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8

 

EXHIBIT A

 

Legal Description

 

[                                                                                                                                              ]

 

Deed of Trust Recording Information

 

[                                                                                                                                              ]

 

9

 

EXHIBIT B

 

AGREEMENT EFFECTIVE DATE CERTIFICATE

 

February 23, 2011

 

THE UNDERSIGNED HEREBY CERTIFY, EACH IN HIS OR HER CAPACITY AS AN OFFICER OF REGAL CINEMAS CORPORATION, A DELAWARE CORPORATION (“BORROWER”) AND NOT INDIVIDUALLY, AS FOLLOWS:

 

1.  We are, respectively, the chief financial officer and the executive vice president of Borrower.

 

2.  We have reviewed the terms of Section 6 of the Permitted Secured Refinancing Agreement, dated as of February 23, 2011 (the “Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among Parent, Holdings, the Borrower, the Guarantors and the Administrative Agent, and the definitions and provisions contained in such Credit Agreement relating thereto, and in our opinion we have made, or have caused to be made under our supervision, such examination or investigation as is necessary to enable us to express an informed opinion as to the matters referred to herein.

 

3.  Based upon our review and examination described in paragraph 2 above, we hereby certify, on behalf of Borrower and not in our individual capacities, that as of the date hereof:

 

(i)            the representations and warranties of Borrower contained in each of the Loan Documents to which it is a party are true and correct in all material respects on and as of the Agreement Effective Date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties are true and correct in all material respects on and as of such earlier date;

 

(ii)           Borrower has performed in all material respects all agreements and satisfied all conditions that the Agreement provides shall be performed or satisfied on or before the Agreement Effective Date; and

 

(iii)          no event has occurred and is continuing or would result from the consummation of the transactions contemplated by the Agreement on the date hereof that would constitute an Event of Default or a Default.

 

4.  Each Loan Party has requested Hogan Lovells US LLP to deliver to the Administrative Agent and Lenders a written opinion in form and substance satisfactory to Administrative Agent.

 

5.  For purposes of satisfying the notice obligation in respect of newly designated Unrestricted Subsidiaries set forth in Section 5.2(b)(ii) of the Credit Agreement, the following Subsidiaries of the Borrower have been designated by the board of directors of the Borrower as Unrestricted Subsidiaries: (a) Regal Distribution, LLC, a Delaware limited liability company; (b)Regal Distribution Holdings, LLC, a Delaware limited liability company; and (c) REGAMC, LLC, a Delaware limited liability company.

 

[Remainder of page intentionally left blank]

 

 

The foregoing certifications are made and delivered as of the date first written above.

 

 

	
REGAL CINEMAS CORPORATION
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Name:   Peter B. Brandow
    	
 
    
	
Title:   Executive Vice President
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Name:   David Ownby
    	
 
    
	
Title:   Chief Financial Officer
    	
 
    

 

 

[Regal Cinemas Corporation — Permitted Secured Refinancing Agreement]WebFilings | EDGAR view

 

 
Exhibit 10(a)
 
 
 
 
 
 
 
 
 
 
Magellan Midstream Partners
Long-Term Incentive Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amended and Restated 
October 20, 2010

1

 

 
Magellan Midstream Partners
Long-Term Incentive Plan
October 20, 2010
 
SECTION 1.    Purpose of the Plan.
The Magellan Midstream Partners Long-Term Incentive Plan (the “Plan”) is intended to promote the interests of Magellan Midstream Partners, L.P., a Delaware limited partnership (the “Partnership”), by providing to directors of Magellan GP, LLC, a Delaware limited liability company (the “Company”) and the general partner of the Partnership, and employees of its Affiliates who perform services for the Partnership, incentive compensation awards for superior performance that are based on Units.  The Plan is also contemplated to enhance the ability of the Company and its Affiliates to attract and retain the services of individuals who are essential for the growth and profitability of the Partnership and to encourage them to devote their best efforts to the business of the Partnership, thereby advancing the interests of the Partnership and its partners. 
SECTION 2.    Definitions.
As used in the Plan, the following terms shall have the meanings set forth below:
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, the Person in question.  As used herein, the term “control” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise.
“Award” means a Phantom Unit or Performance Award granted under the Plan and shall include any tandem DERs granted with respect to a Phantom Unit.
“Award Agreement” means the written agreement by which an Award shall be evidenced.
“Board” means the Board of Directors of the Company.
“Committee” means the Compensation Committee of the Board or such other committee of the Board appointed by the Board to administer the Plan.
“DER” means a contingent right, granted in tandem with a specific Phantom Unit, to receive an amount in cash equal to the cash distributions made by the Partnership with respect to a Unit during the period such Phantom Unit is outstanding.
“Director” means a member of the Board who is not an Employee.
“Disability” shall have the meaning ascribed to such term in the Company's governing long-term disability plan, or if no such plan is applicable to the Participant, as determined by the Committee.
“Employee” means any employee of the Company or an Affiliate who performs services for the Partnership, as determined by the Committee.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Fair Market Value” means the closing sales price of a Unit on the payment date (or if there is no trading in the Units on such date, on the next preceding date on which there was trading) as reported in The Wall Street Journal (or other reporting service approved by the Committee).  In the event Units are not publicly traded at the time a determination of fair market value is required to be made hereunder, the determination of fair market value shall be made in good faith by the Committee. 

2

 

“Participant” means any Employee or Director granted an Award under the Plan.
“Partnership Agreement” means the Fifth Amended and Restated Agreement of Limited Partnership of Magellan Midstream Partners, L.P, as it may be amended or amended and restated from time to time.
“Performance Award” means a right, granted under Section 6(b) hereof, to receive Awards based upon performance criteria specified by the Committee.
“Person” means an individual, corporation, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other entity.
“Phantom Unit” means a phantom (notional) Unit granted under the Plan which upon vesting entitles the Participant to receive a Unit or an amount of cash equal to the Fair Market Value of a Unit, whichever is determined by the Committee.
“Restricted Period” means the period established by the Committee with respect to an Award during which the Award remains subject to forfeiture and is not payable to the Participant, which for a Phantom Unit Award is generally three years.
“Retirement” shall have the meaning ascribed to such term in the Company's governing tax-qualified retirement plan, or if no such plan is applicable to the Participant, as determined by the Committee.
“Rule 16b-3” means Rule 16b-3 promulgated by the SEC under the Exchange Act, or any successor rule or regulation thereto as in effect from time to time.
“SEC” means the Securities and Exchange Commission, or any successor thereto.
“Unit” means a common unit of the Partnership.
SECTION 3.    Administration.
The Plan shall be administered by the Committee.  A majority of the Committee shall constitute a quorum, and the acts of the members of the Committee who are present at any meeting thereof at which a quorum is present, or acts unanimously approved by the members of the Committee in writing, shall be the acts of the Committee.  Subject to the following and any applicable law, the Committee, in its sole discretion, may delegate any or all of its powers and duties under the Plan, including the power to grant Awards under the Plan, to the Chief Executive Officer of the Company, subject to such limitations on such delegated powers and duties as the Committee may impose, if any.  Upon any such delegation all references in the Plan to the “Committee”, other than in Section 8, shall be deemed to include the Chief Executive Officer; provided, however, that such delegation shall not limit the Chief Executive Officer's right to receive Awards under the Plan.  Notwithstanding the foregoing, the Chief Executive Officer may not grant Awards to, or take any action with respect to any Award previously granted to, a person who is an officer subject to Rule 16b-3 or a Director.  Subject to the terms of the Plan and applicable law, and in addition to other express powers and authorizations conferred on the Committee by the Plan, the Committee shall have full power and authority to: (i) designate Participants; (ii) determine the type or types of Awards to be granted to a Participant; (iii) determine the number of Units to be covered by Awards; (iv) determine the terms and conditions of any Award; (v) determine whether, to what extent and under what circumstances Awards may be settled, canceled or forfeited; (vi) interpret and administer the Plan and any instrument or agreement relating to an Award made under the Plan; (vii) establish, amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; and (viii) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan.  Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations and other decisions under or with respect to the Plan or any Award shall be within the sole discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon all Persons, including the Company, the Partnership, any Affiliate, any Participant and any beneficiary of any Award.

3

 

SECTION 4.    Units.
(a)    Units Available.  Subject to adjustment as provided in Section 4(c), the number of Units with respect to which Awards may be granted under the Plan is 4,700,000 Number of units available is subject to unitholder approval at 2011 Annual Meeting of Limited Partners to be held on April 27, 2011..  If any Phantom Unit is forfeited or otherwise terminates or is canceled without the delivery of a Unit, then the Unit covered by such Award, to the extent of such forfeiture, termination or cancellation shall again be Units with respect to which an Award may be granted.
(b)    Sources of Units Deliverable Under Awards.  Any Units delivered pursuant to an Award shall consist, in whole or in part, of Units acquired in the open market, from any Affiliate, the Partnership or any other Person, or any combination of the foregoing. 
(c)    Adjustments.  In the event that the Committee determines that any distribution (whether in the form of cash, Units, other securities, or other property), recapitalization, split, reverse split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Units or other securities of the Partnership, issuance of warrants or other rights to purchase Units or other securities of the Partnership, or other similar transaction or event affects the Units such that an adjustment is determined by the Committee to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and type of Units (or other securities or property) with respect to which Awards may be granted and (ii) the number and type of Units (or other securities or property) subject to outstanding Awards or, if deemed appropriate, make provision for a cash payment to the holder of an outstanding Award; provided, that the number of Units subject to any Award shall always be a whole number.
SECTION 5.    Eligibility.
Any Employee or Director shall be eligible to be designated a Participant and receive an Award under the Plan.
SECTION 6.    Awards.
(a)    Phantom Units.  The Committee shall have the authority to determine the Employees and Directors to whom Phantom Units shall be granted, the number of Phantom Units to be granted to each such Participant, the Restricted Period, the conditions under which the Phantom Units may become vested or forfeited, which may include, without limitation, the accelerated vesting upon the achievement of specified performance goals, and such other terms and conditions as the Committee may establish with respect to such Awards, including whether DERs are granted with respect to such Phantom Units.
(i)    DERs.  To the extent provided by the Committee, in its discretion, a grant of Phantom Units may include a tandem DER grant, which may provide that such DERs shall be paid directly to the Participant, be credited to a bookkeeping account (with or without interest in the discretion of the Committee) subject to the same vesting restrictions as the tandem Award, or be subject to such other provisions or restrictions as determined by the Committee in its discretion. 
(ii)    Forfeiture.  Except as otherwise provided in the terms of the Phantom Units grant, upon termination of a Participant's employment with the Company and its Affiliates or membership on the Board, whichever is applicable, for any reason during the applicable Restricted Period, all Phantom Units shall be forfeited by the Participant.  The Committee may, in its discretion, waive in whole or in part such forfeiture with respect to a Participant's Phantom Units.
(iii)    Lapse of Restrictions.  Upon or as soon as reasonably practical following the vesting of each Phantom Unit, subject to the provisions of Section 9(b), the Participant shall be entitled to receive from the Company one Unit or cash equal to the Fair Market Value of a Unit, as determined by the Committee in its discretion.
(b)    Performance Awards.  The Committee is authorized to grant Performance Awards to Participants on 

4

 

the following terms and conditions:
(i)    Right to Payment.  A Performance Award shall confer upon Participant rights, valued as determined by the Committee, and payable to the Participant to whom the Performance Award is granted, in whole or in part, as the Committee shall establish at grant or thereafter.  The performance criteria and all other terms and conditions of the Performance Award shall be determined by the Committee upon the grant of each Performance Award or thereafter.
(ii)    Other Terms.  A Performance Award may be denominated or payable in cash, deferred cash, Units, other Awards or other property, and other terms of Performance Awards shall be as determined by the Committee.
(c)    General.
(i)    Awards May Be Granted Separately or Together.  Awards may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with, or in substitution for any other Award granted under the Plan or any award granted under any other plan of the Company or any Affiliate.  Awards granted in addition to or in tandem with other Awards or awards granted under any other plan of the Company or any Affiliate may be granted either at the same time as or at a different time from the grant of such other Awards or awards.
(ii)    Limits on Transfer of Awards. No Award and no right under any such Award may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or any Affiliate; provided, however, that Awards may be transferred by will and the laws of descent and distribution.
(iii)    Term of Awards.  The term of each Award shall be for such period as may be determined by the Committee.
(iv)    Unit Certificates.  All certificates for Units or other securities of the Partnership delivered under the Plan pursuant to any Award shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the SEC, any stock exchange upon which such Units or other securities are then listed, and any applicable federal or state laws, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions. 
(v)    Consideration for Grants.  Awards may be granted for such consideration, including services, as the Committee determines.
(vi)    Delivery of Units or other Securities.  Notwithstanding anything in the Plan or any grant agreement to the contrary, delivery of Units pursuant to vesting of an Award may be deferred for any period during which, in the good faith determination of the Committee, the Company is not reasonably able to obtain Units to deliver pursuant to such Award without violating the rules or regulations of any applicable law or securities exchange.  Such payment may be made by such method or methods and in such form or forms as the Committee shall determine.
SECTION 7.      Change in Control.
(a)    Change in Control.  A “Change in Control” shall be deemed to have occurred upon the occurrence of one or more of the following events:  (i) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of the Partnership to any Person, other than to an Affiliate of the Partnership; (ii) the consolidation, reorganization, merger or other transaction pursuant to which more than 50% of the combined voting power of the outstanding equity interests in the Company cease to be owned by the Partnership 

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or its Affiliates; or (iii) a Person other than the Partnership or its Affiliates becoming the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities and Exchange Act of 1934) of more than 50% of the then outstanding common units of the Partnership. 
(b)      Payout of Awards after Change in Control.  If, within two (2) years following a Change in Control, a Participant has a Termination of Affiliation (excluding any transfer to an Affiliate of the Company) voluntarily for Good Reason or involuntarily (other than due to Cause), Awards granted prior to a Change in Control, shall automatically vest and become payable, in full, and all Restricted Periods shall terminate and all performance criteria, if any, shall be deemed to have been achieved at the maximum level with respect to such Awards.  Any payout owed to the Participant pursuant to this section shall be settled in cash.
(c)    Notification of Good Reason Event.  If, within two (2) years following a Change in Control, a Good Reason Event occurs, the Participant shall provide written notice to the Company not later than 90 days after the occurrence of the Good Reason Event setting forth in reasonable detail the circumstances that constitute the Good Reason Event and tendering his or her resignation for Good Reason.  If the Participant does not provide notice as set forth above, the Participant shall not have the right to resign for Good Reason based on any Good Reason Event occurring more than 90 days before a notice is given.  Upon receipt of the Participant's written notice, the Company shall have 30 days to remedy the Good Reason Event or to notify the Participant of its intent to not remedy the Good Reason Event,  If the Company remedies the Good Reason Event within such 30 day period, the Participant's resignation for Good Reason shall be rescinded and the Company shall have no obligation to pay the amount due pursuant to this section.  If the Company, (i) does not cure the Good Reason Event within such 30 day period or, (ii) gives notice to the Participant of its intent to not remedy the Good Reason Event, the Participant's resignation shall be effective immediately, and the Company shall be obligated to make payment to the Participant as provided herein.
(d)    Definitions.  For purposes of this Section 7 only, the following terms shall have the meanings set forth below:
(i)    “Cause” means, unless otherwise defined in an Award Agreement, the occurrence of any one or more of the following, as determined in the good faith and reasonable judgment of the Committee:  (i) willful failure by a Participant to substantially perform his or her duties (as they existed immediately prior to a Change of Control), other than any such failure resulting from a Disability, or (ii) gross negligence or willful misconduct of the Participant which results in a significantly adverse effect upon the Company, the Partnership, or an Affiliate thereof, or (iii) willful violation or disregard of the code of business conduct or other published policy of the Company, the Partnership, or an Affiliate thereof by the Participant, or (iv) Participant's conviction of a crime involving an act of fraud, embezzlement, theft, or any other act constituting a felony or causing material harm, financial or otherwise, to the Company, the Partnership, or an Affiliate thereof.
(ii)    “Termination of Affiliation” occurs on the first day on which an individual is for any reason no longer providing services to the Company, the Partnership, or an Affiliate thereof.
(iii)    “Good Reason” or “Good Reason Event” means, unless otherwise defined in an Award Agreement, the occurrence, within two years following a Change of Control and without a Participant's prior written consent, of any one or more of the following:
(1)    a material change in the Participant's duties from those assigned to the Participant immediately prior to a Change of Control, unless associated with a bona fide promotion of the Participant and a commensurate increase in the Participant's compensation, in which case the Participant shall be deemed to consent; 
(2)    a significant reduction in the authority and responsibility assigned to the Participant; 
(3)    the removal of the Participant from, or failure to reelect the Participant to, any corporate or similar office of the Company, the Partnership, or an Affiliate thereof to which the Participant may have been elected and was occupying immediately prior to a Change of Control, 

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unless associated with a bona fide promotion of the Participant and a commensurate increase in the Participant's compensation or in connection with the election or appointment of the Participant to a corresponding or higher office of the Company or any Affiliate, in each which case the Participant shall be deemed to consent;
(4)    a reduction of more than 10% of a Participant's base salary; 
(5)    termination of any of the incentive compensation plans of the Partnership or the Company in which the Participant shall be participating at the time of a Change of Control,  unless such plan is replaced by a successor plan providing incentive opportunities and awards at least as favorable to the Participant as those provided in the plan being terminated;
(6)    amendment of  any of the incentive compensation plans of the Partnership or the Company in which the Participant shall be participating at the time of a Change of Control so as to provide for incentive opportunities and awards less favorable to the Participant than those provided in the plan being amended;
(7)    failure by the Company, the Partnership, or an Affiliate thereof to continue the Participant as a participant in any of the Company's or Partnership's incentive compensation plans in which the Participant is participating immediately prior to a Change of Control on a basis comparable to the basis on which other similarly situated employees participate in such plan; 
(8)    except in relation to a wage freeze applicable to all employees of the Company, the Partnership, or an Affiliate thereof, modification of the administration of any of the incentive compensation plans so as to adversely affect the level of incentive opportunities or awards actually received by the Participant;
 (9)    a requirement by the Company, the Partnership, or an Affiliate thereof that the Participant's principal duties be performed at a location more than fifty (50) miles from the location where the Participant was employed immediately preceding the Change of Control, except for travel reasonably required in the performance of the Participant's duties;
(10)    a significant reduction in the authority, duties or responsibilities of the supervisor to whom the Participant reports, including a requirement that the Participant report to an officer of the Company or employee instead of reporting directly to the board of directors of the Company; 
(11)    a significant reduction in the budget over which the Participant retains authority; or
(12)    any other action or inaction that constitutes a material breach by the Partnership, Company or Affiliate of an agreement, if any, under with the Participant provides services. 
SECTION 8.    Amendment and Termination.
Except to the extent prohibited by applicable law:
(a)    Amendments to the Plan.  Except as required by the rules of the principal securities exchange on which the Units are traded and subject to Section 8(b) below, the Board or the Committee may amend, alter, suspend, discontinue or terminate the Plan in any manner, including increasing the number of Units available for Awards under the Plan, without the consent of any partner, Participant, other holder or beneficiary of an Award or other Person.
(b)    Amendments to Awards.  Subject to Section 8(a), the Committee may waive any conditions or rights under, amend any terms of, or alter any Award theretofore granted, provided (i) the Committee may not reprice the Awards and (ii) no change, other than pursuant to Section 8(c), in any Award shall materially 

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reduce the benefit to Participant without the consent of such Participant.
(c)    Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events.  Subject to Section 8(b), the Committee is hereby authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring events (including, without limitation, the events described in Section 4(c) of the Plan) affecting the Partnership or the financial statements of the Partnership, or of changes in applicable laws, regulations or accounting principles, whenever the Committee determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan. 
SECTION 9.    General Provisions.
(a)    No Rights to Award.  No Person shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Participants.  The terms and conditions of Awards need not be the same with respect to each recipient.
(b)    Withholding.  The Company or any Affiliate is authorized to withhold from any Award, from any payment due or transfer made under any Award or from any compensation or other amount owing to a Participant the amount (in cash, Units, other securities, Units that would otherwise be issued pursuant to such Award or other property) of any applicable taxes payable in respect of the grant of an Award, the lapse of restrictions thereon, or any payment or transfer under an Award or under the Plan and to take such other action as may be necessary in the opinion of the Company to satisfy its withholding obligations for the payment of such taxes.  In no event shall the withholding for taxes exceed that which is necessary to satisfy the employer's minimum withholding requirements.  Units withheld for the payment of taxes shall not again be Units with respect to which Awards may be granted.
(c)    No Right to Employment.  The grant of an Award shall not be construed as giving a Participant the right to be retained in the employ of the Company or any Affiliate or to remain on the Board, as applicable.  Further, the Company or an Affiliate may at any time dismiss a Participant from employment, free from any liability or any claim under the Plan, unless otherwise expressly provided in the Plan or in any Award agreement.
(d)    Governing Law.  The validity, construction, and effect of the Plan and any rules and regulations relating to the Plan shall be determined in accordance with the laws of the State of Delaware law without regard to its conflict of laws principles.
(e)    Severability.  If any provision of the Plan or any award is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or as to any Person or Award, or would disqualify the Plan or any award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, person or award and the remainder of the Plan and any such Award shall remain in full force and effect.
(f)    Other Laws.  The Committee may refuse to issue or transfer any Units or other consideration under an Award if, in its sole discretion, it determines that the issuance or transfer or such Units or such other consideration might violate any applicable law or regulation, the rules of the principal securities exchange on which the Units are then traded or entitle the Partnership or an Affiliate to recover the same under Section 16(b) of the Exchange Act.
(g)    No Trust or Fund Created.  Neither the Plan nor any award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any participating Affiliate and a Participant or any other Person.  To the extent that any Person acquires a right to receive payments from the Company or any participating Affiliate pursuant to an award, such right shall be no greater than the right of any general unsecured creditor of the Company or any participating Affiliate.
(h)    No Fractional Units.  No fractional Units shall be issued or delivered pursuant to the Plan or any Award, and the Committee shall determine whether cash, other securities or other property shall be paid or transferred 

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in lieu of any fractional Units or whether such fractional Units or any rights thereto shall be canceled, terminated or otherwise eliminated.
(i)    Headings.  Headings are given to the Sections and subsections of the Plan solely as a convenience to facilitate reference.  Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof.
(j)    Facility Payment.  Any amounts payable hereunder to any person under legal disability or who, in the judgment of the Committee, is unable to properly manage his financial affairs, may be paid to the legal representative of such person, or may be applied for the benefit of such person in any manner which the Committee may select, and the Company shall be relieved of any further liability for payment of such amounts.
(k)    Gender and Number.  Words in the masculine gender shall include the feminine gender, the plural shall include the singular and the singular shall include the plural.
SECTION 10.   Term of the Plan.
The Plan shall be effective on the date of its approval by the Board and shall continue until the date terminated by the Board or Units are no longer available for the payment of Awards under the Plan, whichever occurs first.  However, unless otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award granted prior to such termination, and the authority of the Board or the Committee to amend, alter, adjust, suspend, discontinue or terminate any such Award or to waive any conditions or rights under such Award, shall extend beyond such termination date.
 
 

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