Document:

Exhibit 10.8

 

SEVENTH
AMENDMENT TO CREDIT AGREEMENT

 

THIS SEVENTH AMENDMENT TO CREDIT AGREEMENT
(this “Amendment”), dated as of March 31st, 2009, is made
by and among RHINO ENERGY LLC, a Delaware
limited liability company, formerly known as CAM Holdings LLC (“Borrower”),
EACH OF THE GUARANTORS (as hereinafter
defined), the LENDERS  PARTY HERETO,
and PNC BANK, NATIONAL ASSOCIATION, in its
capacity as administrative agent for the Lenders under this Agreement
(hereinafter referred to in such capacity as “Agent”).

 

WITNESSETH:

 

WHEREAS, Borrower, Guarantors (as defined
therein), Lenders (as defined therein) and Agent are parties to that certain
Credit Agreement, dated as of August 30, 2006; as amended by that certain
First Amendment to Credit Agreement, dated as of December 28, 2006; as
amended by that certain Second Amendment to Credit Agreement and Consent, dated
as of March 8, 2007; as amended by that certain Third Amendment to Credit
Agreement, dated as of February 29, 2008; as amended by that certain
Fourth Amendment to Credit Agreement, dated as of May 15, 2008; as amended
by that certain Fifth Amendment to Credit Agreement, dated June 1, 2008,
as amended by that certain Sixth Amendment to Credit Agreement and Amendment to
Fifth Amendment to Credit Agreement, dated November 4, 2008 (as so amended
and as the same may be further amended, modified or supplemented from time to
time, the “Credit Agreement”);

 

WHEREAS, capitalized terms used herein and
not otherwise defined herein and defined in the Credit Agreement shall have the
meanings assigned to them in the Credit Agreement;

 

WHEREAS, Borrower wishes to make certain
changes to certain covenants contained in the Credit Agreement;

 

WHEREAS, the Loan Parties now request that
Required Lenders agree to the amendments to the Credit Agreement set forth
herein; and Required Lenders are willing to accommodate the request of the Loan
Parties, subject to and on the terms and conditions set forth herein.

 

NOW, THEREFORE, the parties hereto, in
consideration of their mutual covenants and agreements hereinafter set forth,
and intending to be legally bound hereby, covenant and agree as follows:

 

1.             Amendment of Section 1.1 [Certain
Definitions].

 

(a)           The following definitions contained in Section 1.1
[Certain Definitions] are hereby amended and restated in their entirety as
follows:

 

“Availability
shall mean, as of the date of determination, an amount, which equals the lesser of (i) the
difference (if a
positive number) between the amount of the Revolving Credit Commitments as of
such date, less the Revolving Facility Usage as of such date or (ii) the
difference (if a
positive number) between the maximum pro-

 

 

forma
amount of the available Revolving
Credit Commitments that the Borrower could draw as of such date and remain in compliance
with the covenants contained in this Agreement, less the Revolving Facility Usage as of such date.”

 

“Base
Rate shall mean, for any day, a fluctuating per annum rate of interest
equal to the highest of (i) the interest rate per annum announced from
time to time by the Agent at its Principal Office as its then prime rate, which
rate may not be the lowest rate then being charged commercial borrowers by the
Agent, (ii) the Federal Funds Open Rate plus 50 basis points (1⁄2 of 1%),
and (iii) the Daily LIBOR Rate plus 100 basis points (1%).  Interest on borrowings at the Base Rate is
calculated on an actual/360 day basis and is payable quarterly.

 

For purposes of this
definition, “Daily LIBOR Rate” shall mean, for any day, the rate per annum
determined by the Agent by dividing (x) the Published Rate by (y) a
number equal to 1.00 minus the
percentage prescribed by the Federal Reserve for determining the maximum
reserve requirements with respect to any eurocurrency funding by banks on such
day.  “Published Rate” shall mean the
rate of interest published each Business Day in The Wall Street Journal “Money
Rates” listing under the caption “London Interbank Offered Rates” for a one
month period (or, if no such rate is published therein for any reason, then the
Published Rate shall be the eurodollar rate for a one month period as published
in another publication determined by the Agent).”

 

“Federal
Funds Open Rate shall mean the rate per annum determined by the Agent in
accordance with its usual procedures (which determination shall be conclusive
absent manifest error) to be the “open” rate for federal funds transactions for
federal funds transactions among members of the Federal Reserve System arranged
by federal funds brokers on such day, as quoted by Garvin Guybutler, any
successor entity thereto, or any other broker selected by the Agent, as set
forth on the applicable Bloomberg display page; provided, however;
that if such day is not a Business Day, the Federal Funds Open Rate for such
day shall be the “open” rate on the immediately preceding Business Day, or if
no such rate shall be quoted by a federal funds broker at such time, such other
rate as determined by the Agent in accordance with its usual procedures.  The rate of interest charged shall be
adjusted as of each Business Day based on changes in the federal funds rate
without notice to the Borrower.”

 

(b)           Section 1.1 [Certain Definitions] of
the Credit Agreement is hereby amended to insert the following new definition
in the appropriate alphabetical order therein:

 

“Seventh Amendment shall mean that certain Seventh Amendment to
Credit Agreement, dated as of March 31, 2009, among Borrower, Guarantors,
Lenders party thereto and Agent.”

 

2.             Amendment of Section 8.1.14
[Collateral and Additional Collateral, Etc.].  Section 8.1.14
(ii)(a) and Section 8.1.14 (iii)(iii)(B) of the Credit Agreement
are hereby amended to delete the phrase “(other than Property located in
Colorado or Illinois)”.

 

2

 

3.             Amendment of Section 8.2.6
[Liquidations, Mergers, Consolidations, Acquisitions].  Section 8.2.6
(3)(vii) of the Credit Agreement is hereby amended and restated in its
entirety as follows:

 

“(vii)       If the Borrower’s pro-forma Leverage Ratio before and
after giving effect to such Permitted Acquisition and any Loan associated
therewith is (A) greater than or equal to 3.0 to 1.0, then the Borrower
shall have Availability of at least $25,000,000 after giving effect to such
Permitted Acquisition and any Loan associated therewith and (B) less than
3.0 to 1.0, then the Borrower shall have Availability of at least $15,000,000
after giving effect to such Permitted Acquisition and any Loan associated
therewith;”

 

4.             Amendment of Section 8.2.17 [Maximum
Leverage Ratio].  Section 8.2.17 of the Credit Agreement
is hereby amended and restated in its entirety and reads as follows:

 

“8.2.17    Maximum Leverage Ratio.

 

The Loan Parties shall not at any time permit the Leverage Ratio,
calculated as of the end of each fiscal quarter set forth below to exceed the
applicable ratio set forth below:

 

	
  Fiscal
  Period Then Ending

  	
   

  	
  Ratio

  
	
  March 31, 2009

  	
   

  	
  4.0 to 1.0

  
	
   

  	
   

  	
   

  
	
  June 30, 2009

  	
   

  	
  4.0 to 1.0

  
	
   

  	
   

  	
   

  
	
  September 30, 2009

  	
   

  	
  3.75 to 1.0

  
	
   

  	
   

  	
   

  
	
  December 31, 2009

  	
   

  	
  3.5 to 1.0

  
	
   

  	
   

  	
   

  
	
  March 31, 2010

  	
   

  	
  3.5 to 1.0

  
	
   

  	
   

  	
   

  
	
  June 30, 2010

  	
   

  	
  3.5 to 1.0

  
	
   

  	
   

  	
   

  
	
  September 30, 2010

  	
   

  	
  3.5 to 1.0

  
	
   

  	
   

  	
   

  
	
  December 31, 2010

  	
   

  	
  3.25 to 1.0

  
	
   

  	
   

  	
   

  
	
  March 31, 2011

  	
   

  	
  3.25 to 1.0

  
	
   

  	
   

  	
   

  
	
  June 30, 2011 and
  each fiscal quarter thereafter

  	
   

  	
  3.0 to 1.0”

  

 

3

 

5.             Amendment of Section 8.3.3 [Annual
Financial Statements].  Section 8.3.3 of the
Credit Agreement is hereby amended and restated in its entirety and reads as
follows:

 

“8.3.3      Annual
Financial Statements.

 

As soon as available and in
any event within ninety (90) days after the end of each fiscal year of the
Borrower, financial statements of the Borrower and its Subsidiaries consisting
of a consolidated and consolidating balance sheet as of the end of such fiscal
year, and related consolidated and consolidating statements of income, retained
earnings, and cash flows for the fiscal year then ended, all in reasonable
detail and setting forth in comparative form the financial statements as of the
end of and for the preceding fiscal year, and certified by independent certified
public accountants of nationally recognized standing satisfactory to the Agent;
provided, however, notwithstanding the foregoing it is agreed that the Borrower
shall have until April 15, 2009 to provide the financial statements for
the 2008 fiscal year to the Agent and the Lenders.  The certificate or report of accountants
shall be free of qualifications (other than any consistency qualification that
may result from a change in the method used to prepare the financial statements
as to which such accountants concur) and shall not indicate the occurrence or
existence of any event, condition or contingency which would materially impair
the prospect of payment or performance of any covenant, agreement or duty of
any Loan Party under any of the Loan Documents.”

 

6.             Pricing Grid.  Schedule
1.1(A)  —  Pricing Grid of the
Credit Agreement is hereby amended and restated in its entirety as set forth on
the schedule titled as Schedule 1.1(A) — Pricing Grid
attached hereto.

 

7.             Conditions to Closing. 
This Amendment shall become effective as of March 31, 2009 provided
that each of the following conditions has been satisfied to the satisfaction of
the Agent by April 14, 2009:

 

(a)       Execution and Delivery of Amendment. 
The Borrower, the other Loan Parties, the Required Lenders, and the
Agent shall have executed this Amendment, and all other documentation necessary
for effectiveness of this Amendment shall have been executed and delivered all
to the satisfaction of the Borrower, the Required Lenders and the Agent.

 

(b)       Officer’s Certificate.  There shall
be delivered to the Agent a certificate of the Loan Parties, dated the date of
the Amendment and signed by the Chief Executive Officer, President, Vice
President or Chief Financial Officer of each Loan Party, certifying that:  (i) the representations and warranties
of the Borrower contained in Article 6 of the Credit Agreement shall be
true and accurate on and as of the date of the Amendment with the same effect
as though such representations and warranties had been made on and as of such
date (except representations and warranties which relate solely to an earlier
date or time, which representations and warranties shall be true and correct on
and as of the specific dates or times referred to therein); (ii) the Loan
Parties shall have performed and complied with all covenants and conditions of
the Credit Agreement and this Amendment; and (iii) no Event of Default or 

 

4

 

Potential Default under
the Credit Agreement shall have occurred and be continuing or shall exist.

 

(c)       Representations and Warranties; No Event of Default. 
The representations and warranties contained in Section 6 of the
Credit Agreement and this Amendment, and of each Loan Party in each of the
other Loan Documents, are true and correct on and as of the date of this
Amendment with the same effect as though such representations and warranties
had been made on and as of such date (except representations and warranties
which relate solely to an earlier date or time, which representations and
warranties were true and correct on and as of the specific dates or times
referred to therein), each of the Loan Parties has performed and complied with
all covenants and conditions hereof and thereof, and no Event of Default or
Potential Default has occurred and is continuing or exists as of the date of
this Amendment; and by its execution and delivery of this Amendment, the
Borrower and each other Loan Party certifies to each such effect.

 

(d)       Payment of Fees.  The Borrower has
paid, or caused to be paid, (i) all fees, costs and expenses payable to
the Agent or for which the Agent is entitled to be reimbursed, including but
not limited to the reasonable fees and expenses of the Agent’s legal counsel,
and (ii) a closing fee equal payable to each Lender that has executed this
Amendment on or before the date hereof in an amount equal to fifty (50) basis
points of such Lender’s Commitment.

 

(e)       Consents.  All material
consents required to effectuate the transactions contemplated by this Amendment
have been obtained.

 

(f)        Legal Details.  All legal
details and proceedings in connection with the transactions contemplated by
this Amendment are in form and substance satisfactory to the Agent and counsel
for the Agent, and the Agent has received all such other counterpart originals
or certified or other copies of such documents and proceedings in connection
with such transactions, in form and substance satisfactory to the Agent and its
counsel, as the Agent or its counsel may reasonably request.

 

8.             Representations and Warranties. 
By its execution and delivery of this Amendment to Agent, Borrower and
each of the other Loan Parties represents and warrants to Agent and Lenders as
follows:

 

(a)           Authorization, Etc. 
Each Loan Party has duly authorized, executed and delivered this
Amendment.

 

(b)           Material Adverse Change. 
After giving effect to this Amendment, no Material Adverse Change shall
have occurred with respect to Borrower or any of the other Loan Parties since
the Closing Date of the Credit Agreement.

 

(c)           Litigation.  After giving
effect to this Amendment, there are no actions, suits, investigations,
litigation or governmental proceedings pending or, to Borrower’s or any other
Loan Party’s knowledge, threatened against any of the Loan Parties that could
reasonably be expected to result in a Material Adverse Change.

 

5

 

(d)           Organizational Documents Not Amended. 
The organizational documents of such Loan Party have not been amended or
modified since copies thereof were previously delivered to Agent.

 

9.             Miscellaneous.

 

(a)           Full Force and Effect. 
All provisions of the Credit Agreement and the other Loan Documents
remain in full force and effect on and after the date of this Amendment and the
date hereof except as expressly amended hereby. 
The parties do not amend any provisions of the Credit Agreement or any
other Loan Document except as expressly amended hereby.

 

(b)           Counterparts. 
This Amendment may be signed in counterparts (by facsimile transmission
or otherwise), but all of which together shall constitute one and the same
instrument.

 

(c)           Incorporation into Credit Agreement. 
This Amendment shall be incorporated into the Credit Agreement by this
reference.  All representations,
warranties, Events of Default and covenants set forth herein shall be a part of
the Credit Agreement as if originally contained therein.

 

(d)           Governing Law. 
This Amendment shall be deemed to be a contract under the Laws of the
Commonwealth of Pennsylvania and for all purposes shall be governed by and
construed and enforced in accordance with the internal laws of the Commonwealth
of Pennsylvania without regard to its conflict of laws principles.

 

(e)           No Novation. 
Except as amended hereby, all of the terms and conditions of the Credit
Agreement and the other Loan Documents shall remain in full force and
effect.  Borrower, the other Loan
Parties, each Lender, and Agent acknowledge and agree that this Amendment is
not intended to constitute, nor does it constitute, a novation, interruption,
suspension of continuity, satisfaction, discharge or termination of the
obligations, loans, liabilities or indebtedness under the Credit Agreement or
the other Loan Documents.

 

[SIGNATURE PAGE FOLLOWS]

 

6

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

IN WITNESS WHEREOF, the parties hereto, by
their officers thereunto duly authorized, have executed this Seventh Amendment
as of the day and year first above written.

 

	
  ATTEST:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Joseph R. Miller

  	
   

  	
  By:

  	
  /s/ Richard A. Boone

  
	
  Name:

  	
  Joseph R. Miller

  	
   

  	
  Name:

  	
  Richard A. Boone

  
	
  Title: 

  	
  VP, General Counsel

  	
   

  	
  Title:

  	
  Senior Vice President
  and Chief Financial Officer of each of the following companies:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  RHINO ENERGY LLC

  
	
   

  	
   

  	
  CAM
  MINING LLC

  
	
   

  	
   

  	
  CAM-BB
  LLC

  
	
   

  	
   

  	
  CAM-KENTUCKY
  REAL ESTATE LLC

  
	
   

  	
   

  	
  RHINO
  NORTHERN HOLDINGS LLC

  
	
   

  	
   

  	
  CAM
  COAL TRADING LLC

  
	
   

  	
   

  	
  LEESVILLE
  LAND, LLC

  
	
   

  	
   

  	
  CAM
  AIRCRAFT LLC

  
	
   

  	
   

  	
  HOPEDALE
  MINING LLC

  
	
   

  	
   

  	
  CAM-OHIO
  REAL ESTATE LLC

  
	
   

  	
   

  	
  SPRINGDALE
  LAND, LLC

  
	
   

  	
   

  	
  CAM-COLORADO
  LLC

  
	
   

  	
   

  	
  TAYLORVILLE
  MINING LLC

  
	
   

  	
   

  	
  CLINTON STONE LLC

  
	
   

  	
   

  	
  McCLANE CANYON MINING LLC

  
	
   

  	
   

  	
  RHINO COALFIELD SERVICES LLC

  
	
   

  	
   

  	
  RHINO RECLAMATION SERVICES LLC

  
	
   

  	
   

  	
  SANDS HILL MINING LLC

  
	
   

  	
   

  	
  RHINO SERVICES LLC

  
	
   

  	
   

  	
  RESERVE HOLDINGS LLC

  
	
   

  	
   

  	
  RHINO TRUCKING LLC

  
	
   

  	
   

  	
  RHINO TECHNOLOGIES LLC

  
	
   

  	
   

  	
  TRIAD ROOF SUPPORT SYSTEMS LLC

  
	
   

  	
   

  	
  RHINO OILFIELD SERVICES LLC

  
	
   

  	
   

  	
  RHINO EXPLORATION LLC

  
							

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  PNC BANK, NATIONAL ASSOCIATION, individually and as Agent

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Richard C. Munsick

  
	
   

  	
   

  	
  Name:

  	
  Richard C. Munsick

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  
					

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  BANK OF AMERICA, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  THE HUNTINGTON NATIONAL BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ L. Blair DeVan

  
	
   

  	
   

  	
  Name:

  	
  L. Blair DeVan

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
					

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  NATIONAL CITY BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ David M. Metz

  
	
   

  	
   

  	
  Name:

  	
  David M. Metz

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  
					

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  RAYMOND JAMES BANK, FSB, individually and as Co-Documentation
  Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Andrew D. Hahn

  
	
   

  	
   

  	
  Name:

  	
  Andrew D. Hahn

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  
					

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  ROYAL  BANK OF CANADA.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Jay T. Sartain

  
	
   

  	
   

  	
  Name:

  	
  Jay T. Sartain

  
	
   

  	
   

  	
  Title:

  	
  Authorized Signatory

  
					

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  UNION BANK OF CALIFORNIA, N.A., individually and as Co-Documentation
  Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Richard Reeves

  
	
   

  	
   

  	
  Name:

  	
  Richard Reeves

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
					

 

 

[SIGNATURE
PAGE - SEVENTH AMENDMENT TO CREDIT AGREEMENT]

 

 

	
   

  	
   

  	
  WACHOVIA  BANK, NATIONAL
  ASSOCIATION, individually and as Co-Documentation Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Jonathan R.
  Richardson

  
	
   

  	
   

  	
  Name:

  	
  Jonathan R. Richardson

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  
					

 

 

SCHEDULE 1.1(A)

 

Pricing
Grid-Variable Pricing and Fees Based on Leverage Ratio

 

	
  Level

  	
   

  	
  Applicable Leverage

  Ratio

  	
   

  	
  Euro-Rate

  Margin

  	
   

  	
  Base Rate

  Margin

  	
   

  	
  Commitment

  Fee

  	
   

  	
  Applicable

  Letter of

  Credit Fee

  	
   

  
	
  I

  	
   

  	
  Less than or
  equal to 2.00 to 1.00

  	
   

  	
  2.50

  	
  %

  	
  1.00

  	
  %

  	
  .375

  	
  %

  	
  2.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  II

  	
   

  	
  Greater than
  2.00 to 1.00 but less than or equal to 2.50 to 1.00

  	
   

  	
  2.75

  	
  %

  	
  1.25

  	
  %

  	
  .375

  	
  %

  	
  2.75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  III

  	
   

  	
  Greater than
  2.50 to 1.00 but less than or equal to 3.00 to 1.00

  	
   

  	
  3.00

  	
  %

  	
  1.50

  	
  %

  	
  .375

  	
  %

  	
  3.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IV

  	
   

  	
  Greater than
  3.00 to 1.00

  	
   

  	
  3.50

  	
  %

  	
  2.00

  	
  %

  	
  .375

  	
  %

  	
  3.50

  	
  %

  

 

For purposes of determining the Applicable Margin
and the Applicable Letter of Credit Fee Rate:

 

(a)           As of the
Closing Date, the Applicable Margin and Applicable Letter of Credit Fee Rate
shall be such rates determined in accordance with paragraph (b) below,
provided that, for the period beginning with the Closing Date and ending
upon the Financials Delivery Date for the March 31, 2007 Compliance
Certificate, such rates shall be no less than the respective amounts set forth
under Level III of this Schedule 1.1(A) set forth above.

 

(b)           It is expressly
agreed that after the Closing Date, the Applicable Margin and the Applicable
Letter of Credit Fee Rate shall be determined based upon Schedule 1.1(A) above;
provided, however, that the Applicable Margin and the Applicable
Letter of Credit Fee Rate shall be set as of the Financials Delivery Date
regardless of the actual date that a Compliance Certificate is provided to the
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  Exhibit 10.1    
    

[Letterhead
of Castle Creek Financial LLC] 

April 30,
2010 

PacWest
Bancorp

401 West "A" Street

San Diego, CA 92101

Attention: Victor R. Santoro 

Dear
Vic: 

This
letter agreement (the "Agreement") will confirm that, subject to the terms and conditions contained herein, PacWest Bancorp (the "Company") has engaged Castle Creek Financial LLC ("Castle
Creek") as the exclusive financial advisor to the Company in connection with the Company's efforts to (a) acquire or invest in other financial institutions, excepting therefrom the opening of
individual bank branches in the ordinary course of business or acquisition of deposit bases, loan pools or failed institutions from the FDIC; (b) effect a sale of the Company or a material
amount of its assets; or (c) pursue a financing or recapitalization transaction (collectively, the "Transaction"). As the exclusive financial advisor to the Company, Castle Creek will, in
addition to providing services in connection with a proposed Transaction provide other services pursuant to paragraph 9. This Agreement amends and restates the letter agreement between the
Company and Castle Creek dated as of March 25, 2009.  

	1.
	In
connection with a proposed Transaction, at the request of the Company, Castle Creek will provide such services as the Company shall reasonably request
including: (i) assisting the Company in the structuring of the financial aspects of a Transaction; (ii) identifying alternative potential parties and contacting such parties as the
Company may designate; (iii) assist the Company in negotiating the terms of a Transaction with such parties; (iv) assisting the Company in communicating the strategic implications of the
Transaction to the investment community; and (v) advising the Company in connection with its efforts to raise any additional capital that may be required to facilitate the Transaction. Further,
Castle Creek and the Company expressly acknowledge that the fees provided for under paragraph 3 for a completed Transaction were determined in light of the fact that significant financial
advisory services are rendered to the Company in connection with potential Transactions that are not successfully completed. Thus, such fees earned pursuant to paragraph 3 will serve as
compensation for services rendered in connection with a completed Transaction and in connection with potential Transactions that are not successfully completed. Further, such fees are in recognition
of the exclusive arrangement between Castle Creek and the Company, and Castle Creek's commitment to source and present opportunities in the Company's geographic market and niche for the Company's sole
consideration and decision before presenting such opportunities to any third party.

	2.
	In
connection with a proposed Transaction, you will furnish Castle Creek with such material regarding the business and financial condition of the Company as
we reasonably request, all of which will be accurate and complete in all material respects at the time furnished in writing. The Company will also use its reasonable best efforts to assure that its
personnel, consultants, experts, attorneys and accountants are made available to Castle Creek upon Castle Creek's reasonable request in connection with services provided or to be provided by Castle
Creek. While any proposed Transaction may be pending that was initiated during the term of this Agreement, the Company shall promptly notify Castle Creek of (i) any material changes in the
business or financial condition of the Company from the written information provided to Castle Creek, and (ii) any material events or developments relating to the financial condition or
business operations or prospects of the Company and promptly make available for Castle Creek's review copies of all filings related to the Transaction made by the Company with any regulatory agency
and copies of all press releases related to the Transaction issued by the Company. We are relying, without independent verification, on the accuracy and completeness of all information furnished to us
in 

 

writing
by the Company or any other party or potential party to any Transaction. Castle Creek agrees that all requests for information from the Company will be directed only to the Chief Executive
Officer, Chief Financial Officer or General Counsel of the Company or such other persons as the Chief Executive Officer shall specifically designate and that it will not treat information obtained
from any other person or source as having been provided by the Company.  

	3.
	In
consideration of the services to be provided hereunder, the Company agrees to pay to Castle Creek the following cash fees:

	(A)
	In
the event that a sale of the Company is completed, an amount equal to one percent (1.0%) of the Transaction Value (as defined below) for the Transaction.

	(B)
	In
the event that an acquisition of or investment in another financial institution is completed by the Company, an amount based upon the following schedule
will be owed to Castle Creek upon the consummation of the acquisition or investment based upon the Transaction Value for the Transaction, net of the cost of a "fairness opinion" if such opinion is
deemed necessary: 

 

 

											
	 
	 	 
	 	 
	 	Deal Value

($ in millions) 	 	 
	 	Fees 
	 	 	(1)	 	If	 	$0<$20	 	then	 	1.0% of the Transaction Value
	

 	
 	
(2)	
 	
If	
 	
Over $20	
 	
then	
 	
$200,000, plus 0.65% of the amount of the Transaction Value in excess of $20 million.

 

 
	(C)
	In
the event of a financing or recapitalization, the fees will be determined in accordance with paragraph 8 below.

	(D)
	Fees
payable pursuant to paragraphs 3 (A), (B) and (C) shall be paid upon and only upon the closing of the Transaction. 

For
purposes of this Agreement, "Transaction Value" means the sum of (as applicable for the particular Transaction): (i) with respect to each class of capital stock of the Company in the event
of a sale of the Company or of the financial institution which is acquired by the Company or in which the Company
invests, the aggregate consideration paid or payable for all shares of such capital stock and for all shares of such classes issuable upon exercise of options, warrants or other rights, or conversion
or exchange of securities to the extent that such options are then exercisable; (ii) in the case of an acquisition or sale, the aggregate liquidation value of any preferred stock or other
preferential interests redeemed or remaining outstanding; (iii) the fair market value of any assets distributed to the shareholders of the Company or such financial institution that is
purchased, in connection with the Transaction; and (iv) in the case of an asset purchase or sale, the aggregate consideration paid or payable for the assets of the Company or the assets of the
financial institution. 

The
determination of the "aggregate consideration paid or payable" for shares of any classes of capital stock in connection with the Transaction shall include cash, securities (valued in accordance
with the following paragraph), or other assets or consideration paid or payable by the purchaser or any of its affiliates, as the case may be, determined without regard to any allocations between the
Company or its affiliates in the event of a sale of the Company or between the financial institution or its affiliates in the event such financial institution is acquired by the Company or the Company
invests in such financial institution, including but not limited to (i) assets (net of debt or payables) of the Company or such financial institution 

2

 

retained
by the Company or such financial institution or their respective stockholders and affiliates, as the case may be (ii) any deferred installments of the purchase price, (iii) any
portion of the purchase price held in escrow subsequent to closing which is payable pursuant to the terms of the escrow arrangement, irrespective of whether such amounts are in fact paid,
(iv) any payments pursuant to earn-outs, royalties or other similar arrangements, (v) any payments payable after closing upon the occurrence of certain events or conditions
or the satisfaction of certain earnings, sales levels or other performance objectives which are agreed to on or before the closing, irrespective of whether such amounts are in fact paid,
(vii) the amount of any extraordinary dividends or other extraordinary payments or distributions to stockholders of the Company or the financial institution in connection with or in
anticipation of the Transaction, and (viii) consideration paid by the purchaser or its affiliates as a deposit, reimbursement of expenses, liquidated damages, walk-away fee or other
arrangement. 

In
the event that all or any portion of the Transaction Value for a Transaction is paid in stock or other securities, deferred installments or other non-cash consideration, the amount of
the fee payable with respect to such items shall be determined on the basis of the fair market cash equivalent value of such non-cash consideration as of the day preceding the closing date
of the Transaction as reasonably determined by Castle Creek and the Company, provided that the value of securities (received as consideration) which have an existing public trading market shall be
determined by the closing sale (trade) price on the closing date. 

Any
portion of the fee which is payable with respect to any earn-out, royalty or similar arrangement where the amount payable is not a certain amount, shall be calculated and paid at the
closing based upon the estimated net present value thereof as reasonably determined by Castle Creek and the Company. 

If a Transaction involves the acquisition of less than all of outstanding securities of the Company, but securities representing more than 50% of the combined voting power of the then outstanding
securities of the Company, then the fee payable pursuant to Section 3(A) shall nonetheless be calculated as though all such equity securities had been so acquired by the purchaser. 

	4.
	Regardless
of whether a Transaction is completed, the Company will reimburse Castle Creek, upon its demand, for all reasonable
out-of-pocket expenses (including travel expenses and fees and disbursements of counsel retained by Castle Creek in connection with this engagement). In seeking such
reimbursement, Castle Creek shall provide an explanation of such charges.

	5.
	The
Company agrees to indemnify and hold Castle Creek harmless in accordance with the terms and conditions of Appendix A attached hereto and made a
part hereof as though fully set forth in this Agreement. No termination or modification hereof, or completion of Castle Creek's engagement hereunder, shall limit or affect such indemnification.

	6.
	Castle
Creek's services hereunder may be terminated by the Company or Castle Creek at any time upon 30 days written notice, provided that Castle Creek
shall be entitled to any fees payable pursuant to Section 3 and Section 8 hereof in the event that the Company completes a Transaction (i) on which Castle Creek provided advice or
participated in discussions with any of the investors in such Transaction or (ii) with any of the parties as to which Castle Creek advised the Company or with whom the Company engaged in
discussions regarding a possible Transaction prior to the termination of this Agreement, providing that such Transaction is completed within eighteen months following the termination of this
Agreement. In addition, Castle Creek shall remain entitled to the reimbursement of fees and expenses under the terms and conditions described in 

3

 

Section 4
hereof, to the extent the same have been incurred on or prior to the date of such termination. Furthermore, the provisions of this Section 6, and Sections 5 (including
Appendix A), 10, 11, 12, 13, 14 and 15 as well as the Confidentiality Agreement, shall survive any termination of this Agreement.  

	7.
	In
order to coordinate our efforts with respect to any Transaction for which the Company intends to engage a financial advisor, during the period of our
engagement hereunder if the Company or its management receives an inquiry regarding a Transaction, they will promptly advise Castle Creek of such inquiry in order that we can evaluate such prospective
party and its interest and assist the Company in any resulting negotiations.

	8.
	Pursuant
to section 3(C) hereinabove, it is understood and agreed that if the Company decides to pursue a financing or recapitalization Transaction
for which Castle Creek is to provide any of the financial advisory services described above in Section 1 hereof, the Company and Castle Creek shall negotiate in good faith acceptable
compensation for Castle Creek in consideration of such services, which compensation will take into account, among other things, the results obtained and the custom and practice among investment
bankers acting in similar situations. The compensation owed to Castle Creek in accordance with the fee structure agreed upon by the Company and Castle Creek in respect of a financing or
recapitalization Transaction shall be paid to Castle Creek in cash upon the completion of any such Transaction. It is understood that no separate fee will be owed to Castle Creek in consideration of
services in connection with a financing or recapitalization Transaction if such Transaction is undertaken in connection with a Transaction described in Section 3(B) above.

	9.
	It
is understood and agreed that Castle Creek will provide such other services that may from time to time be mutually agreed upon by Castle Creek and the
Company. Castle Creek expressly acknowledges that it will not be compensated specifically for these services other than the reimbursement for all reasonable out-of-pocket
expenses, but that such fees earned from acting as a financial advisor to the Company for a Transaction will serve as compensation to Castle Creek for such non-Transaction services
rendered. Such services rendered to the Company not directly related to a specific Transaction may include, but are not exclusive to (i) the development and preparation of long term financial
and strategic plans, (ii) assistance with investor and public relations, and (iii) capital management advisory services.

	10.
	Except
as expressly provided herein, no fee paid or payable to Castle Creek or any of its affiliates shall be used as an offset or credit against any other
fee paid or payable to Castle Creek or any of its affiliates.

	11.
	This
Agreement, along with the indemnity in Appendix A and the Confidentiality Agreement attached hereto as Annex B, embody the sole terms of
the agreement between the Company and Castle Creek with respect to the subject matter hereof and supersede all previous agreements, whether oral or written, between the Company and Castle Creek with
respect to the subject matter hereof. This Agreement may not be altered, varied, revised or amended, except by an instrument in writing signed by both the Company and Castle Creek after the date first
written above. The Company and Castle Creek have not made any other agreements or representations of any kind with respect to such subject matter.

	12.
	This
Agreement shall be governed by and construed in accordance with the laws of the State of California without regard to principles of conflict of laws.
To the extent legally permissible, any right to trial by jury with respect to any claim or proceeding related to or arising out of this engagement or any transaction or conduct in connection herewith,
is waived. Any claim or dispute arising out of this Agreement or the alleged breach thereof shall be submitted by the parties to binding and nonappealable arbitration by the American Arbitration
Association ("AAA") in San Diego, California, under the commercial rules then in effect for the AAA, except as provided 

4

 

herein.
The AAA shall recommend three arbitrators who are knowledgeable in the field of investment banking. The parties shall agree upon one of the three arbitrators or, if no arbitrator is mutually
agreed upon, the AAA shall appoint one of the three arbitrators within 30 days of such failure. The award rendered by the arbitrator shall include costs of arbitration, reasonable attorneys'
fees and fees of experts and other witnesses, but shall not include punitive damages against either party. Each party shall have the right to request the arbitrator to order reasonable and limited
discovery. Notwithstanding this provision, either party may seek appropriate injunctive relief.  

	13.
	This
Agreement may be executed in counterparts, each of which shall be deemed an original and all of which shall continue one and the same instrument. This
Agreement may be executed by the exchange of facsimile signatures, which shall have the same force and effect as if original signatures had been exchanged.

	14.
	The
Company expressly acknowledges that Castle Creek has been retained solely as an advisor to the Company, and not as an advisor to or agent of any other
person, and that the Company's engagement of Castle Creek is not intended to confer rights upon any persons not a party hereto (including shareholders, employees or creditors of the Company) as
against Castle Creek, Castle Creek's affiliates or their respective directors, officers, agents and employees. Any advice provided to the Company by Castle Creek pursuant to this Agreement is solely
for the information and assistance of the executive management and Board of Directors of the Company. Such advice shall be treated as confidential information and shall not be disclosed to any third
party except in accordance with the terms of the Confidentiality Agreement. Any reference to Castle Creek or to any affiliate of Castle Creek in any release or communication to any party outside the
Company is subject to Castle Creek's prior written approval, which approval shall not be unreasonably withheld or delayed. Castle Creek shall not refer to the Company in any written materials (other
than performance overviews and marketing materials related thereto that may be distributed to both prospective and current investors and clients of Castle Creek and its affiliates) without the
Company's prior written approval, which approval shall not be unreasonably withheld or delayed. If this Agreement is terminated prior to any release or communication, no reference shall be made to
Castle Creek without Castle Creek's prior written approval. Notwithstanding the foregoing, nothing herein is intended to prevent the Company from complying with any disclosure obligations under
applicable law, without seeking Castle Creek's consent.

	15.
	Neither
the Company nor Castle Creek may assign, transfer, license, or sublicense its rights under this Agreement without the other party's prior written
consent, which may be granted or withheld in the other party's sole and absolute discretion. Subject to the limitation in this paragraph, this Agreement will inure to the benefit of and be binding
upon both the Company and Castle Creek and their respective successors and assigns.

	16.
	Castle
Creek represents that it has the necessary expertise to provide the services contemplated by this Agreement and that the compensation provided for
herein is fair and reasonable and comparable to the compensation that would be charged by an independent provider of such services with the same type, level and quality of expertise. The Company
acknowledges that the services contemplated herein will meet legitimate needs of the Company and that it is in the best interests of the Company to obtain such services.

	17.
	After
closing a Transaction, Castle Creek shall have the right to place advertisements in financial and other newspapers and other newspapers and journals
at its own expense describing its services to the Company under this Agreement, provided that Castle Creek shall have submitted a copy of any such proposed advertisements to the Company for its prior
approval, which approval shall not be unreasonably withheld or delayed. 

[Signature
Page Follows] 

5

 

Please
confirm that the foregoing is in accordance with your understanding by signing and returning to us the duplicates of this Agreement and the related indemnification agreement which shall
thereupon constitute binding agreements. 

Very
truly yours, 

Castle Creek Financial LLC

 

 

					
	By:	 	/s/ WILLIAM J. RUH

 	 	 
	Name:	 	William J. Ruh	 	 
	Title:	 	Executive Vice President	 	 
	    	 	 	 	 
	    	 	 	 	 
	Accepted and agreed:
	
 PacWest Bancorp
	

on its behalf and on behalf of the Company,

as defined above.
	
 By:	
 	
/s/ VICTOR R. SANTORO

 	
 	

 
	Name:	 	Victor R. Santoro	 	 
	Title:	 	Executive Vice President and CFO	 	 

 

 6

QuickLinks

Exhibit 10.1

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