Document:

exv10w1

 

Exhibit 10.1

(unit settled)

Final Form of LTIP Grant Letter

(Armstrong, Pefanis, Kramer and vonBerg)

February 22, 2007

«AddressBlock»

     Re:       Grant of Phantom Units

«GreetingLine»

     I am pleased to inform you that you have been granted «Units» Phantom Units as of the above
date pursuant to the Company’s Long-Term Incentive Plan (the “Plan”). In addition, in tandem with
each Phantom Unit you have been granted a distribution equivalent right (a “DER”). The terms and
conditions of this grant are as set forth below.

	 	1.	 	Subject to the further provisions of this Agreement, your Phantom Units shall
vest (become payable in the form of one Common Unit of Plains All American Pipeline,
L.P. for each Phantom Unit) as follows: (i) 33.33% shall vest upon the later to occur
of the May 2011 Distribution Date and the date on which the Partnership pays a
quarterly distribution of at least $0.875 per unit, (ii) 33.33% shall vest upon the
later to occur of the May 2011 Distribution Date and the date on which the Partnership
pays a quarterly distribution of at least $1.00 per unit, and (iii) 33.34% shall vest
upon the later to occur of the May 2012 Distribution Date and the date on which the
Partnership pays a quarterly distribution of at least $0.9375 per unit. Any remaining
Phantom Units that are not vested by the May 2014 Distribution Date, and any tandem
DERs (regardless of vesting) associated with such Phantom Units, shall expire on such
date.
	 
	 	2.	 	Subject to the further provisions of this Agreement, your DERs shall vest
(become payable in cash) as follows: (i) 25% shall vest upon and effective with the
date on which the Partnership pays a quarterly distribution of at least $0.85 per unit,
(ii) 25% shall vest upon and effective with date on which the Partnership pays a
quarterly distribution of at least $0.90 per unit, (iii) 25% shall vest upon and
effective with the date on which the Partnership pays a quarterly distribution of at
least $0.95 per unit, and (iv) 25% shall vest upon and effective with date on which the
Partnership pays a quarterly distribution of at least $1.00 per unit.
	 
	 	3.	 	Your DERs shall not accrue payments prior to vesting.
	 
	 	4.	 	Any distribution level required for vesting under paragraphs 1 or 2 above shall
be proportionately reduced or increased for any split or reverse split, respectively,
of the Units, or any event or transaction having similar effect.

	 	 	 	 	 
	333 Clay Street, Suite 1600

	n	 Houston, Texas 77002
	n	 713/646-4100 or 800-564-3036

 

 

	 	 	 	 	 
	«First_Name» «MI» «Last_Name»

	 	- 2 -
	 	February 22, 2007

	 	5.	 	Upon vesting of any Phantom Units, an equivalent number of DERs will expire.
Any such DERs that are vested prior to, or that would vest as of, the Distribution Date
on which the Phantom Units vest, shall be payable on such Distribution Date prior to
their expiration.
	 
	 	6.	 	In the event of the termination of your employment with the Company and its
Affiliates (other than in connection with a Change in Status or by reason of your
death, “disability,” as defined in paragraph 7 below, or “retirement” as defined in
paragraph 8 below), all of your then outstanding DERs (regardless of vesting) and
Phantom Units shall automatically be forfeited as of the date of termination;
provided, however, that if the Company or its Affiliates terminate your
employment other than a Termination for Cause: (i) any unvested Phantom Units that have
satisfied all vesting criteria as of the date of termination but for the passage of
time shall be deemed nonforfeitable on the date of termination, and shall vest on the
next following Distribution Date; (ii) any DERs associated with the unvested,
nonforfeitable Phantom Units described in clause (i) shall not be forfeited on the date
of termination, but shall be payable and shall expire in accordance with paragraph 5
above; and (iii) any unvested Phantom Units that have satisfied none of the vesting
criteria as of the date of termination, and any tandem DERs (regardless of vesting)
associated with such Phantom Units, shall automatically be forfeited as of the date of
termination.
	 
	 	7.	 	In the event of termination of your employment with the Company and its
Affiliates by reason of your death or your “disability” (a physical or mental infirmity
that impairs your ability substantially to perform your duties for a period of eighteen
months or that the Company otherwise determines constitutes a “disability”), all of
your then outstanding Phantom Units and tandem DERs shall be deemed 100% nonforfeitable
on such date, and (i) such DERs shall vest in accordance with paragraph 2 above and
expire in accordance with paragraph 1 or paragraph 5 above, as applicable, and (ii)
such Phantom Units shall vest or expire in accordance with paragraph 1 above; provided,
however, that such vesting of Phantom Units shall occur either (x) on the date the
Partnership pays the quarterly distribution specified in clause (i), (ii) or (iii) of
paragraph 1 (and in the proportion indicated therein) without regard to any requirement
for further passage of time or (y) if the relevant quarterly distribution has been paid
prior to the date of termination, on the next following Distribution Date. As soon as
administratively practicable after the vesting of any Phantom Units pursuant to this
paragraph 7, payment will be made in cash in an amount equal to the Market Value of the
number of Phantom Units vesting.
	 
	 	8.	 	In the event of your Retirement, 50% of any unvested Phantom Units that have
satisfied all vesting criteria as of the date of termination but for the passage of
time shall be deemed nonforfeitable on the date of termination, and shall vest on the next
following Distribution Date; provided, that any DERs associated with the
unvested, nonforfeitable Phantom Units described in this paragraph shall not be
forfeited on

 

 

	 	 	 	 	 
	«First_Name» «MI» «Last_Name»

	 	- 3 -
	 	February 22, 2007

	 	 	 	the date of termination, but shall be payable and shall expire in
accordance with paragraph 5 above. All other unvested Phantom Units and tandem DERs
(regardless of vesting) shall automatically be forfeited as of the date of retirement.
“Retirement” means (i) you have reached the age of 60 prior to meeting the time
requirement for vesting, (ii) you provide a written statement that you are retiring,
and (iii) the written statement includes your agreement not to accept any employment or
consulting position with any competitor in the hydrocarbon midstream business for a
period of two years after the date of retirement.
	 
	 	9.	 	In the event of a Change in Status, all of your then outstanding Phantom Units
and tandem DERs shall be deemed 100% nonforfeitable on such date, and such Phantom
Units shall vest in full upon the next Distribution Date.
	 
	 	10.	 	Upon payment pursuant to a DER, you agree that the Company may withhold any
taxes due from your compensation as required by law. Upon vesting of a Phantom Unit,
you agree that the Company may withhold any taxes due from your compensation as
required by law, which (in the sole discretion of the Company) may include withholding
a number of Common Units otherwise payable to you.

     As used herein, the phrase “Distribution Date” means the date, in any given month and year, on
which the Partnership pays a quarterly distribution. “Market Value” means the average of the
closing sales prices for a Common Unit on the New York Stock Exchange for the five trading days
preceding the then most recent “ex dividend” date for payment of a distribution by the Partnership.

     The phrase “Change in Status” means the occurrence, within three months prior to or one year
following a Change of Control, of any of the following circumstances: (A) any termination by the
Company of your employment other than a Termination for Cause, (B) without your consent, any
removal of you from, or any failure to re-elect you to, the positions held by you (or
substantially equivalent positions) immediately prior to the change that may constitute a Change in
Status, or (C) any reduction in your base salary or (D) any material reduction in your fringe
benefits.

     The phrase “Change of Control” means, and shall be deemed to have occurred upon the occurrence
of, one or more of the following events: (i) the Company ceasing to be the general partner of the
general partner of the Partnership, (ii) 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 or the Company to any Person and/or its Affiliates, other than to the Partnership or
the Company, including any employee benefit plan thereof; (iii) a consolidation, reorganization,
merger or any other similar transaction involving (a) a Person other than the Partnership or the
Company and (b) the Partnership, the Company or both, (iv) the Persons who own membership interests
in the Company on the date hereof cease to beneficially own, directly or indirectly, more than 50%
of the membership interest in the Company, or (v) any Person, including any partnership, limited partnership, syndicate or other group deemed a “person” for purposes of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, becoming after the date
hereof the beneficial owner, directly or indirectly, of more than 49.9% of the membership

 

 

	 	 	 	 	 
	«First_Name» «MI» «Last_Name»

	 	- 4 -
	 	February 22, 2007

interest
in the Company. Notwithstanding the foregoing, no Change of Control shall be deemed to have
occurred in connection with a restructuring or reorganization related to a securitization and sale
to the public of direct or indirect equity interests in the general partner if (x) the Company
retains direct or indirect control over the general partner and (y) the Persons who own membership
interests in the Company on the date hereof continue to beneficially own, directly or indirectly,
more than 50% of the membership interest in the Company.

     The phrase “Termination for Cause” shall mean severance of your employment with the Company or
its Affiliates based on your (i) failure to perform your job function in accordance with standards
described to you in writing, or (ii) violation of the Company’s Code of Business Conduct (unless
waived in accordance with the terms thereof), in each case, with the specific failure or violation
described to you in writing.

     The “Company” refers to Plains All American GP LLC. The “Partnership” refers to Plains All
American Pipeline, L.P.

     Terms used herein that are not defined herein shall have the meanings set forth in the Plan
or, if not defined in the Plan, in the Third Amended and Restated Agreement of Limited Partnership
of Plains All American Pipeline, L.P., as amended (the “Partnership Agreement”). By signing below,
you agree that the Phantom Units and DERs granted hereunder are governed by the terms of the Plan.
Copies of the Plan and the Partnership Agreement are available upon request. Please execute and
return this Agreement to me. The attached copy of this Agreement is for your records

	 	 	 	 	 
	 	 	PLAINS ALL AMERICAN PIPELINE, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	PLAINS AAP, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	PLAINS ALL AMERICAN GP LLC
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:
	 	Tim Moore
	 

	 	Title:
	 	Vice President & General Counsel

	 	 	 	 	 
	 	 	 
	«First_Name» «MI» «Last_Name»	 	 
	 
	 	 	 	 
	Units:

	 	«Units»
 

	 	 
	 
	 	 	 	 
	Dated:
	 	 	 	 
	 

	 	 

	 	 

 

 

(cash settled)

Final Form of LTIP Grant Letter

(Coiner)

February 22, 2007

«AddressBlock»

     Re:      Grant of Phantom Units

«GreetingLine»:

     I am pleased to inform you that you have been granted «Units» Phantom Units as of the above
date pursuant to the Company’s 2005 Long-Term Incentive Plan (the “Plan”). In addition, in tandem
with each Phantom Unit you have been granted a distribution equivalent right (a “DER”). The terms
and conditions of this grant are as set forth below.

	 	1.	 	Subject to the further provisions of this Agreement, your Phantom Units shall
vest (become payable in cash based on the Market Value of an equivalent number of
Common Units of Plains All American Pipeline, L.P.) as follows: (i) 33.33% shall vest
upon the later to occur of the May 2011 Distribution Date and the date on which the
Partnership pays a quarterly distribution of at least $0.875 per unit, (ii) 33.33%
shall vest upon the later to occur of the May 2011 Distribution Date and the date on
which the Partnership pays a quarterly distribution of at least $1.00 per unit, and
(iii) 33.34% shall vest upon the later to occur of the May 2012 Distribution Date and
the date on which the Partnership pays a quarterly distribution of at least $0.9375 per
unit. Any remaining Phantom Units that are not vested by the May 2014 Distribution
Date, and any tandem DERs (regardless of vesting) associated with such Phantom Units,
shall expire on such date.
	 
	 	2.	 	Subject to the further provisions of this Agreement, your DERs shall vest
(become payable in cash) as follows: (i) 25% shall vest upon and effective with the
date on which the Partnership pays a quarterly distribution of at least $0.85 per unit,
(ii) 25% shall vest upon and effective with date on which the Partnership pays a
quarterly distribution of at least $0.90 per unit, (iii) 25% shall vest upon and
effective with the date on which the Partnership pays a quarterly distribution of at
least $0.95 per unit, and (iv) 25% shall vest upon and effective with date on which the
Partnership pays a quarterly distribution of at least $1.00 per unit.
	 
	 	3.	 	Your DERs shall not accrue payments prior to vesting.
	 
	 	4.	 	Any distribution level required for vesting under paragraphs 1 or 2 above shall
be proportionately reduced or increased for any split or reverse split, respectively,
of the Units, or any event or transaction having similar effect.

	 	 	 	 	 
	333 Clay Street, Suite 1600

	n	 Houston, Texas 77002
	n	 713/646-4100 or 800-564-3036

 

 

	 	 	 	 	 
	«First_Name» «MI» «Last_Name»

	 	- 2 -
	 	February 22, 2007

	 	5.	 	Upon vesting of any Phantom Units, an equivalent number of DERs will expire.
Any such DERs that are vested prior to, or that would vest as of, the Distribution Date
on which the Phantom Units vest, shall be payable on such Distribution Date prior to
their expiration.
	 
	 	6.	 	In the event of the termination of your employment with the Company and its
Affiliates (other than in connection with a Change in Status or by reason of your
death, “disability,” as defined in paragraph 7 below, or “retirement” as defined in
paragraph 8 below), all of your then outstanding DERs (regardless of vesting) and
Phantom Units shall automatically be forfeited as of the date of termination;
provided, however, that if the Company or its Affiliates terminate your
employment other than a Termination for Cause: (i) any unvested Phantom Units that have
satisfied all vesting criteria as of the date of termination but for the passage of
time shall be deemed nonforfeitable on the date of termination, and shall vest on the
next following Distribution Date; (ii) any DERs associated with the unvested,
nonforfeitable Phantom Units described in clause (i) shall not be forfeited on the date
of termination, but shall be payable and shall expire in accordance with paragraph 5
above; and (iii) any unvested Phantom Units that have satisfied none of the vesting
criteria as of the date of termination, and any tandem DERs (regardless of vesting)
associated with such Phantom Units, shall automatically be forfeited as of the date of
termination.
	 
	 	7.	 	In the event of termination of your employment with the Company and its
Affiliates by reason of your death or your “disability” (a physical or mental infirmity
that impairs your ability substantially to perform your duties for a period of eighteen
months or that the Company otherwise determines constitutes a “disability”), all of
your then outstanding Phantom Units and tandem DERs shall be deemed 100% nonforfeitable
on such date, and (i) such DERs shall vest in accordance with paragraph 2 above and
expire in accordance with paragraph 1 or paragraph 5 above, as applicable, and (ii)
such Phantom Units shall vest or expire in accordance with paragraph 1 above; provided,
however, that such vesting of Phantom Units shall occur either (x) on the date the
Partnership pays the quarterly distribution specified in clause (i), (ii) or (iii) of
paragraph 1 (and in the proportion indicated therein) without regard to any requirement
for further passage of time or (y) if the relevant quarterly distribution has been paid
prior to the date of termination, on the next following Distribution Date. As soon as
administratively practicable after the vesting of any Phantom Units pursuant to this
paragraph 7, payment will be made in cash in an amount equal to the Market Value of the
number of Phantom Units vesting.
	 
	 	8.	 	In the event of your Retirement, 50% of any unvested Phantom Units that have
satisfied all vesting criteria as of the date of termination but for the passage of
time shall be deemed nonforfeitable on the date of termination, and shall vest on the
next following Distribution Date; provided, that any DERs associated with the
unvested, nonforfeitable Phantom Units described in this paragraph shall not be
forfeited on

 

 

	 	 	 	 	 
	«First_Name» «MI» «Last_Name»

	 	-3-
	 	February 22, 2007

	 	 	 	the date of termination, but shall be payable and shall expire in
accordance with paragraph 5 above. All other unvested Phantom Units and tandem DERs
(regardless of vesting) shall automatically be forfeited as of the date of retirement.
“Retirement” means (i) you have reached the age of 60 prior to meeting the time
requirement for vesting, (ii) you provide a written statement that you are retiring,
and (iii) the written statement includes your agreement not to accept any employment or
consulting position with any competitor in the hydrocarbon midstream business for a
period of two years after the date of retirement.
	 
	 	9.	 	In the event of a Change in Status, all of your then outstanding Phantom Units
and tandem DERs shall be deemed 100% nonforfeitable on such date, and such Phantom
Units shall vest in full upon the next Distribution Date.
	 
	 	10.	 	Upon payment pursuant to a DER, you agree that the Company may withhold any
taxes due from your compensation as required by law. Upon vesting of a Phantom Unit,
you agree that the Company may withhold any taxes due from your compensation as
required by law, which (in the sole discretion of the Company) may include withholding
a number of Common Units otherwise payable to you.

     As used herein, the phrase “Distribution Date” means the date, in any given month and year, on
which the Partnership pays a quarterly distribution. “Market Value” means the average of the
closing sales prices for a Common Unit on the New York Stock Exchange for the five trading days
preceding the then most recent “ex dividend” date for payment of a distribution by the Partnership.

     The phrase “Change in Status” means the occurrence, within three months prior to or one year
following a Change of Control, of any of the following circumstances: (A) any termination by the
Company of your employment other than a Termination for Cause, (B) without your consent, any
removal of you from, or any failure to re-elect you to, the positions held by you (or
substantially equivalent positions) immediately prior to the change that may constitute a Change in
Status, or (C) any reduction in your base salary or (D) any material reduction in your fringe
benefits.

     The phrase “Change of Control” means, and shall be deemed to have occurred upon the occurrence
of, one or more of the following events: (i) the Company ceasing to be the general partner of the
general partner of the Partnership, (ii) 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 or the Company to any Person and/or its Affiliates, other than to the Partnership or
the Company, including any employee benefit plan thereof; (iii) a consolidation, reorganization,
merger or any other similar transaction involving (a) a Person other than the Partnership or the
Company and (b) the Partnership, the Company or both, (iv) the Persons who own membership interests in the Company on the date hereof cease to beneficially own, directly or indirectly,
more than 50% of the membership interest in the Company, or (v) any Person, including any
partnership, limited partnership, syndicate or other group deemed a “person” for purposes of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, becoming after the date
hereof the beneficial owner, directly or indirectly, of more than 49.9% of the membership

 

 

	 	 	 	 	 
	«First_Name» «MI» «Last_Name»

	 	- 4 -
	 	February 22, 2007

interest
in the Company. Notwithstanding the foregoing, no Change of Control shall be deemed to have
occurred in connection with a restructuring or reorganization related to a securitization and sale
to the public of direct or indirect equity interests in the general partner if (x) the Company
retains direct or indirect control over the general partner and (y) the Persons who own membership
interests in the Company on the date hereof continue to beneficially own, directly or indirectly,
more than 50% of the membership interest in the Company.

     The phrase “Termination for Cause” shall mean severance of your employment with the Company or
its Affiliates based on your (i) failure to perform your job function in accordance with standards
described to you in writing, or (ii) violation of the Company’s Code of Business Conduct (unless
waived in accordance with the terms thereof), in each case, with the specific failure or violation
described to you in writing.

     The “Company” refers to Plains All American GP LLC. The “Partnership” refers to Plains All
American Pipeline, L.P.

     Terms used herein that are not defined herein shall have the meanings set forth in the Plan
or, if not defined in the Plan, in the Third Amended and Restated Agreement of Limited Partnership
of Plains All American Pipeline, L.P., as amended (the “Partnership Agreement”). By signing below,
you agree that the Phantom Units and DERs granted hereunder are governed by the terms of the Plan.
Copies of the Plan and the Partnership Agreement are available upon request. This letter corrects
and replaces a similar letter of the same date. Please execute and return this Agreement to me.
The attached copy of this Agreement is for your records

	 	 	 	 	 
	 	 	PLAINS ALL AMERICAN PIPELINE, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	PLAINS AAP, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	PLAINS ALL AMERICAN GP LLC
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:
	 	Tim Moore
	 

	 	Title:
	 	Vice President & General Counsel

	 	 	 	 	 
	 	 	 
	«First_Name» «MI» «Last_Name»	 	 
	 
	 	 	 	 
	Units:

	 	«Units»
 

	 	 
	 
	 	 	 	 
	Dated:exv4w3

 

Exhibit 4.3

NINTH AMENDMENT TO LOAN AND SECURITY AGREEMENT

     THIS NINTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (hereinafter referred to as the
“Amendment”) is made and entered into as of the 19th day of March, 2007, between and among,
on the one hand, the lenders identified on the signature pages hereof (such lenders, together with
their respective successors and assigns, are referred to hereinafter each individually as a
“Lender” and collectively as the “Lenders”), WELLS FARGO FOOTHILL, INC., a
California corporation (f/k/a Foothill Capital Corporation), as the arranger and administrative
agent for the Lenders (“Agent”), and, on the other hand, PCI CHEMICALS CANADA COMPANY, a
Nova Scotia unlimited liability company, and PIONEER AMERICAS LLC, a Delaware limited liability
company (hereinafter each individually is referred to as a “Borrower” and collectively as
the “Borrowers”).

RECITALS

     A. Agent, the Lenders and the Borrowers have entered into that certain Loan and Security
Agreement, dated as of December 31, 2001 (as amended from time to time the “Agreement”).

     B. Agent, the Lenders and the Borrowers desire to amend the Agreement as hereinafter set
forth.

     NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending
to be legally bound, hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.01. Definitions. Capitalized terms used in this Amendment, to the extent
not otherwise defined herein, shall have the same meaning as in the Agreement, as amended hereby.

ARTICLE II

AMENDMENTS

     Section 2.01. Amendments to Section 1.1 of the Agreement.

     (a) The term “2007 Indenture” and its definition are hereby added to and made a part of
Section 1.1 of the Agreement and shall read as follows:

     “ ‘2007 Indenture’ means that certain Indenture dated as of March 26,
2007 between Parent and Wells Fargo Bank, N.A., as Trustee, relating to the issuance
of the 2007 Subordinated Notes.”

     (b) The term “2007 Indenture Documents” and its definition are hereby added to and made
a part of Section 1.1 of the Agreement and shall read as follows:

 

 

     “ ‘2007 Indenture Documents’ means the 2007 Indenture, the 2007
Subordinated Notes and all other agreements and documents executed in connection
with the 2007 Indenture.”

     (c) The term “2007 Subordinated Notes” and its definition are hereby added to and made
a part of Section 1.1 of the Agreement and shall read as follows:

     “ ‘2007 Subordinated Notes means the 2.75 % Convertible Senior
Subordinated Notes due 2027, issued by the Parent in a principal amount of up to
$120,000,000.00.”

     (d) The term “Indenture Documents” in Section 1.1 of the Loan Agreement is
hereby amended in its entirety to hereafter read as follows:

     “ ‘Indenture Documents’ means the Tranche B Indenture, the Tranche B
Indenture Documents, the Term Loan Agreement, the Term Loan Agreement Documents, and
the 2007 Indenture Documents.”

     (e) The terms “Tranche A Indenture” and “Tranche A Documents” and their respective
definitions are hereby deleted from the Agreement in their entirety.

     (f) The term “Tranche B Documents” in Section 1.1 of the Agreement is hereby
amended in its entirety to hereafter read as follows:

     “ ‘Tranche B Indenture Documents’ has the meaning set forth in the
Tranche B Indenture.”

     Section 2.02. Amendment to Section 2.12(a)(ii). Subsection (ii) of Section 2.12(a) of
the Agreement is hereby amended to hereafter read as follows:

     “(ii) the Letter of Credit Usage would exceed $25,000,000.00, or”

     Section 2.03. Amendment to Section 5.22. Section 5.22 of the Agreement is
hereby amended in its entirety to hereafter read as follows:

     “5.22 Indenture Documents. The Indenture Documents, true and complete
copies of which have been furnished to the Lenders, have been duly authorized,
executed, and delivered by the Borrowers and the Guarantors, and, to the best of
Borrowers’ knowledge, all other parties thereto. The Indenture Documents have not
been amended or otherwise modified, are in full force and effect, and are binding
upon and enforceable against all parties thereto in accordance with their respective
terms. There exists are no default under any of the Indenture Documents by
Borrowers or Guarantors or, to the best of Borrowers’ knowledge, any other party
thereto. The Obligations constitute “senior indebtedness” under the Indenture
Documents and Borrowers and Parent have advised the trustees under the Indenture
Documents that the Obligations constitute “senior indebtedness.”

 

 

     Section 2.04. Amendment to Section 6.18. Section 6.18 of the Agreement is
hereby amended in its entirety to hereafter read as follows:

     “6.18 Indenture Documents. Borrowers shall perform and observe, and
shall cause Guarantors to perform and observe, all the terms and provisions of the
Indenture Documents to be performed and observed by them.”

     Section 2.05. Amendment to Section 7.1. Section 7.1 of the Agreement is
hereby amended in its entirety to be hereafter read as follows:

     “7.1 Indebtedness. Create, incur, assume, permit, guarantee, or
otherwise become or remain, directly or indirectly, liable with respect to any
Indebtedness, except:

     (a) Indebtedness evidenced by this Agreement and the other Loan Documents,
together with Indebtedness owed to Underlying Issuers with respect to Underlying
Letters of Credit;

     (b) Indebtedness comprising Permitted Indebtedness;

     (c) Permitted Purchase Money Indebtedness;

     (d) refinancings, renewals, or extensions of Indebtedness permitted under
clauses (b), (c) of this Section 7.1 so long as: (i) the terms and conditions of
such refinancings, renewals, or extensions do not, in Agent’s judgment, materially
impair the prospects of repayment of the Obligations by Borrowers or Guarantors or
materially impair the creditworthiness of Borrower or Guarantors, (ii) such
refinancings, renewals, or extensions do not result in an increase in the principal
amount of, or interest rate with respect to, the Indebtedness so refinanced,
renewed, or extended, (iii) such refinancings, renewals, or extensions do not result
in a shortening of the average weighted maturity of the Indebtedness so refinanced,
renewed, or extended, nor are they on terms or conditions, that, taken as a whole,
are materially more burdensome or restrictive to the applicable Borrower or
Guarantor, and (iv) if the Indebtedness that is refinanced, renewed, or extended was
subordinated in right of payment to the Obligations, then the terms and conditions
of the refinancing, renewal, or extension Indebtedness must be include subordination
terms and conditions that are at least as favorable to the Lender Group as those
that were applicable to the refinanced, renewed, or extended Indebtedness;

     (e) Notes to Professionals; and

     (f) The 2007 Subordinated Notes and other Indebtedness of the Parent under and
pursuant to the 2007 Indenture Documents provided (i) the proceeds of the 2007
Subordinated Notes are used by the Parent, among other things, to repay the
Indebtedness of the Borrowers under the Tranche B Indenture Documents, and (ii) the
terms and conditions of the 2007 Indenture Documents include subordination terms and
conditions that are at least as favorable to the Lender
Group as those that are applicable to the Indebtedness of the Borrowers
evidenced by the Tranche B Indenture Documents.”

 

 

     Section 2.06. Amendment to Section 7.8. Section 7.8 of the Agreement is
hereby amended in its entirety to hereafter read as follows:

     “7.8 Prepayments and Amendments. 

     (a) Except in connection with a refinancing permitted by Section
7.1(d), prepay, redeem, defease, purchase, or otherwise acquire any Indebtedness
of any Borrower or any Guarantor, other than (i) the Obligations in accordance with
this Agreement and (ii) Indebtedness owing by Borrowers under the Tranche B
Indenture Document to the extent paid with proceeds from Indebtedness incurred by
the Parent under the 2007 Indenture Documents; and

     (b) Except in connection with a refinancing permitted by Section 7.1(d),
directly or indirectly, amend, modify, alter, increase, or change any of the terms
or conditions of any agreement, instrument, document, indenture, or other writing
evidencing or concerning Indebtedness permitted under Sections 7.1(b), (c), (e), or
(f).”

     Section 2.07. Amendment to Section 7.11. Section 7.11 of the Agreement is
hereby amended in its entirety to hereafter read as follows:

     “7.11 Distributions. Make any distributions or declare or pay any
dividends (in cash or other property, other than common Stock) on, or purchase,
acquire redeem, or retire any stock of any of the Borrowers or Guarantors, of any
class, whether now or hereafter outstanding; provided, however, so
long as no Default or Event of Default has occurred and is continuing, the foregoing
restrictions shall not apply to:

     (a) dividends and distributions payable (i) by Pioneer Americas to PCI
Chemicals and (ii) by PCI Chemicals to the Parent, provided the aggregate amount of
such dividends and distributions together with investments permitted to be made to
the Parent by Pioneer Americas pursuant to Section 7.13(b) do not exceed
$500,000.00 in any calendar year during the term of this Agreement; and

     (b) repurchases by the Parent of up to $25,000,000.00 of Parent’s common Stock
during calendar year 2007 provided (i) the repurchases are made by Parent solely
with proceeds of the 2007 Subordinated Notes and (ii) immediately after each such
repurchase by Parent of its common Stock and after giving effect thereto, (aa)
Adjusted EBITDA of the Parent and its Subsidiaries shall be at least $75,000,000.00
and (bb) Liquidity shall be at least $50,000,000.00.”

 

 

ARTICLE III

CONDITIONS PRECEDENT

     Section 3.01. Conditions. The effectiveness of this Amendment is subject to the
satisfaction of the following conditions precedent, unless specifically waived by Agent:

     (a) Agent shall have received the following documents, each in form and substance
satisfactory to Agent:

     (i) This Amendment, duly executed by Borrowers, together with the Consent and
Ratification (the “Ratification”) hereto, duly executed by the Guarantors;

     (ii) Officers’ Certificates dated as of the date of this Amendment, in form and
substance satisfactory to Agent, certified by the Secretary of the Borrowers and the
Guarantors certifying among other things, that the Borrowers’ and Guarantors’ Board
of Directors have met and have adopted, approved, consented to and ratified
resolutions which authorize the execution, delivery and performance by Borrowers of
this Amendment, and the Guarantors of the Ratification, and each other document,
instrument and agreement executed in connection with or relating to the Agreement,
this Amendment or the Ratification (hereinafter individually referred to as a
“Loan Document” and collectively referred to as the “Loan
Documents”);

     (b) The representations and warranties contained herein, in the Agreement, as amended
hereby, and/or in each other Loan Document shall be true and correct as of the date hereof,
as if made on the date hereof;

     (c) No Event of Default shall have occurred and be continuing and no Default shall
exist, unless such Event of Default or Default has been specifically waived in writing by
Agent; and

     (d) All corporate proceedings taken in connection with the transactions contemplated by
this Amendment and all documents, instruments and other legal matters incident thereto,
shall be satisfactory to Agent.

     (e) The terms of subordination of the 2007 Subordinated Notes contained in the 2007
Indenture are consistent with, and the other terms of the 2007 Indenture are materially
consistent with, the terms set forth in the March 15, 2007 draft of the Description of the
Notes previously provided to the Lender.

ARTICLE IV

RATIFICATIONS, REPRESENTATIONS AND WARRANTIES

     Section 4.01. Ratifications. The terms and provisions set forth in this Amendment
shall modify and supersede all inconsistent terms and provisions set forth in the Agreement and
except as expressly modified and superseded by this Amendment, the terms and provisions of the
Agreement and the other Loan Documents are ratified and confirmed and shall continue in full

 

 

force and effect. Borrowers and the Agent agree that the Agreement, as amended hereby, and
the other Loan Documents shall continue to be legal, valid, binding and enforceable in accordance
with their respective terms.

     Section 4.02. Representations and Warranties. Borrowers hereby represent and warrant
to Agent as follows:

     (a) the execution, delivery and performance of this Amendment and any and all other
Loan Documents executed and/or delivered in connection herewith have been authorized by all
requisite corporate action on the part of Borrowers and do not and will not conflict with or
violate any provision of any Applicable Law, the Articles of Incorporation/Organization or
Bylaws/Operating Agreement of any Borrower or any agreement, document, judgment, license,
order or permit applicable to or binding upon any of the Borrowers or their respective
Property; no consent, approval, authorization or order of and no notice to or filing with,
any court or governmental authority or third person is required in connection with the
execution, delivery or performance of this Amendment or to consummate the transactions
contemplated hereby;

     (b) the representations and warranties contained in the Agreement, as amended hereby,
and any other Loan Document are true and correct on and as of the date hereof as though made
on and as of the date hereof, except to the extent such representations and warranties
relate to an earlier date;

     (c) Borrowers are in full compliance with all covenants and agreements contained in the
Agreement, as amended hereby, and the other Loan Documents; and

     (d) Borrowers have not amended their respective Articles of Incorporation/Organization
or Bylaws/Operating Agreement or other organizational documents since the date of the
execution of the Agreement.

ARTICLE V

MISCELLANEOUS

     Section 5.01. Survival of Representations and Warranties. All representations and
warranties made in the Agreement or any other document or documents relating thereto,
including, without limitation, any Loan Document furnished in connection with this
Amendment, shall survive the execution and delivery of this Amendment and the other Loan Documents,
and no investigation by Agent or any closing shall affect the representations and warranties or the
right of Agent to rely upon them.

     Section 5.02. Reference to Agreement. Each of the Loan Documents, including the
Agreement and any and all other agreements, documents or instruments now or hereafter executed and
delivered pursuant to the terms hereof or pursuant to the terms of the Agreement, as amended
hereby, are hereby amended so that any reference in such Loan Documents to the Agreement shall mean
a reference to the Agreement, as amended hereby.

     Section 5.03. Expenses of Agent. As provided in the Agreement, each Borrower agrees
to pay on demand all reasonable costs and expenses incurred by Agent in connection with the

 

 

preparation, negotiation and execution of this Amendment and the other Loan Documents executed
pursuant hereto and any and all amendments, modifications, and supplements hereto, including,
without limitation, the reasonable costs and fees of Agent’s legal counsel, and all reasonable
costs and expenses incurred by Agent in connection with the enforcement or preservation of any
rights under the Agreement, as amended hereby, or any other Loan Document, including, without
limitation, the reasonable costs and fees of Agent’s legal counsel.

     Section 5.04. RELEASE. EACH BORROWER HEREBY ACKNOWLEDGES THAT IT HAS NO DEFENSE,
COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE WHATSOEVER THAT CAN BE
ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF ITS LIABILITY TO REPAY THE OBLIGATIONS OR TO
SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM THE AGENT OR THE LENDERS. EACH
BORROWER HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES THE AGENT AND THE
LENDERS, THEIR PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE CLAIMS,
DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR
UNKNOWN, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL,
AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AMENDMENT IS
EXECUTED, WHICH THE BORROWER MAY NOW OR HEREAFTER HAVE AGAINST THE AGENT AND THE LENDERS, THEIR
PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY
SUCH CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING
FROM ANY OF THE OBLIGATIONS, INCLUDING, WITHOUT LIMITATION, ANY CONTRACTING FOR, CHARGING, TAKING,
RESERVING, COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE HIGHEST LAWFUL RATE APPLICABLE, THE
EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION
FOR AND EXECUTION OF THIS AMENDMENT.

     Section 5.05. Severability. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder
of this Amendment and the effect thereof shall be confined to the provision so held to be invalid
or unenforceable.

     Section 5.06. APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED
PURSUANT HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS.

     Section 5.07. Successors and Assigns. This Amendment is binding upon and shall inure
to the benefit of Agent, the Lenders and the Borrowers and their respective successors and assigns,
except the Borrowers may not assign or transfer any of their rights or obligations hereunder
without the prior written consent of Agent.

     Section 5.08. Counterparts. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original, but all of which
when taken together shall constitute one and the same instrument.

 

 

     Section 5.09. Effect of Waiver. No consent or waiver, express or implied, by Agent to
or for any breach of or deviation from any covenant or condition of the Agreement shall be deemed a
consent or waiver to or of any other breach of the same or any other covenant, condition or duty.

     Section 5.10. Headings. The headings, captions, and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of this Amendment.

     Section 5.11. FINAL AGREEMENT. THE AGREEMENT, AS AMENDED HEREBY AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES RELATED TO THE SUBJECT MATTER HEREOF
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF
THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

[The Remainder of this Page Intentionally Left Blank]

 

 

     IN WITNESS WHEREOF, the Borrowers, Agent and the Lenders have caused this Amendment to be
executed on the date first written above by their duly authorized officers.

	 	 	 	 	 
	 	PCI CHEMICALS CANADA COMPANY

a Nova Scotia unlimited liability company

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and Chief Financial Officer 	 
	 
	 	PIONEER AMERICAS LLC

a Delaware limited liability company

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and Chief Financial Officer 	 
	 
	 	WELLS FARGO FOOTHILL, INC.,

a California corporation (f/k/a Foothill Capital Corporation),

as Agent and as a Lender

 	 
	 	By:  	/s/Terri Le
 	 
	 	 	Name:  	Terri Le 	 
	 	 	Title:  	Vice President 	 
	 

 

 

CONSENT AND RATIFICATION

     The undersigned, Pioneer Companies, Inc., Pioneer (East), Inc., Pioneer Licensing, Inc.,
Imperial West Chemical Co., KNA California, Inc., Pioneer Water Technologies, Inc., and KWT, Inc.
(each a “Guarantor” and collectively the “Guarantors”) have executed that certain
continuing general guaranty dated as of December 31, 2001 (the “Guaranty”), in favor of
WELLS FARGO FOOTHILL, INC., a California corporation (f/k/a Foothill Capital Corporation), as the
arranger and administrative agent for the Lenders (as defined in the Guaranty). The Guarantors
hereby consent and agree to the terms of the Ninth Amendment to Loan and Security Agreement dated
as of March 19, 2007 (the “Amendment”), executed by PCI CHEMICALS CANADA COMPANY, a Nova
Scotia unlimited liability company, and PIONEER AMERICAS LLC, a Delaware limited liability company
(hereinafter each individually is referred to as a “Borrower” and collectively as the
“Borrowers”), the Lenders and Agent, a copy of which is attached hereto, and the
undersigned agree that the Guaranty shall remain in full force and effect and shall continue to be
the legal, valid and binding obligation of the Guarantors in enforceable against the Guarantors in
accordance with its terms. Furthermore, each Guarantor hereby agrees and acknowledges that (a) the
Guaranty is a “Loan Document” as such term is defined in the Amendment and as such term is defined
in the Agreement, (b) the Guaranty is not subject to any claims, defenses or offsets, (c) nothing
contained in this Amendment or any other Loan Document shall adversely affect any right or remedy
of Agent under the Guaranty, (d) the execution and delivery of the Amendment shall in no way
reduce, impair or discharge any obligations of the undersigned as guarantors pursuant to the
Guaranty and shall not constitute a waiver by Agent of any of Agent’s rights against the
undersigned, (e) by virtue hereof and by virtue of the Guaranty, each Guarantor hereby guarantees
to Agent the prompt and full payment and full and faithful performance by the Borrowers of the
entirety of the Obligations (as defined in the Agreement) on the terms and conditions set forth in
the Agreement as amended by the Amendment and any time further modified or amended, (f) the
Guarantors’ consent is not required to the effectiveness of the Amendment, and (g) no consent by
the Guarantors is required for the effectiveness of any future amendment, modification, forbearance
or other action with respect to the Agreement or any present or future Loan Document.

	 	 	 	 	 
	 	Pioneer Companies, Inc.

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and

Chief Financial Officer 	 
	 
	 	Pioneer (East), Inc.

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and

Chief Financial Officer 	 
	 

 

 

	 	 	 	 	 
	 	Pioneer Licensing, Inc.

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and

Chief Financial Officer 	 
	 
	 	Imperial West Chemical Co.

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and

Chief Financial Officer 	 
	 
	 	KNA California, Inc.

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and

Chief Financial Officer 	 
	 
	 	Pioneer Water Technologies, Inc.

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and

Chief Financial Officer 	 
	 
	 	KWT, Inc.

 	 
	 	By:  	/s/Gary L. Pittman
 	 
	 	 	Name:  	Gary L. Pittman 	 
	 	 	Title:  	Sr. Vice President and

Chief Financial Officer

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