SECOND AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AGREEMENT
Exhibit 2.1
SECOND AMENDMENT TO
THIS SECOND AMENDMENT to the Membership Interest Purchase Agreement dated as of March 8, 2009,
as amended by the First Amendment to Membership Interest Purchase Agreement dated as of April 6,
2009 (collectively, the “Purchase Agreement”), by and between Rio Tinto Sage LLC, a Delaware
limited liability company (“Seller”), and Arch Coal, Inc., a Delaware corporation (“Buyer”), is
made and entered into between Seller and Buyer (each a “Party” and collectively, the “Parties”), as
of this 30th day of September, 2009 (the “Second Amendment”).
RECITALS
A. Seller and Buyer entered into the Purchase Agreement in order to sell and transfer the
equity interests of Xxxxxx Ranch to Buyer.
B. Seller currently directly owns one hundred percent (100%) of the membership interests of
Xxxxxx Ranch.
C. In order to consummate the Acquisition, Seller has determined that it is in its best
interest to revise the ownership structure of Xxxxxx Ranch through (a) the formation of Xxxxxx
Ranch Holdings I, a Delaware limited liability company qualified to do business in Wyoming and a
direct, wholly-owned subsidiary of Seller (“Xxxxxx Ranch Holdings I”); (b) the formation of Xxxxxx
Ranch Holdings II, a Delaware limited liability company qualified to do business in Wyoming, a
direct, wholly-owned subsidiary of Xxxxxx Ranch Holdings I and an indirect subsidiary of Seller
(“Xxxxxx Ranch Holdings II”); and (c) the transfer of all of the membership interests of Xxxxxx
Ranch from Seller to Xxxxxx Ranch Holdings II (the “Restructure”). Upon completion of the
Restructure, (a) Seller will own one hundred percent (100%) of the membership interests in Xxxxxx
Ranch Holdings I, (b) Xxxxxx Ranch Holdings I will own one hundred percent of the membership
interests of Xxxxxx Ranch Holdings II, and (c) Xxxxxx Ranch Holdings II will own 100% of the
membership interests of Xxxxxx Ranch.
D. As a result of the Restructure, the State of Wyoming Department of Environmental Quality,
Land Quality Division, has determined that no further Required Approvals are necessary for (a)
Permit to Mine, Permit 271; and (b) License to Mine, License numbers 271-T1-L1, 271-L2, and 271-L3,
in respect of the transfer of the membership interests in Xxxxxx Ranch Holdings I by Seller to
Buyer.
E. The Parties have determined that certain covenants may be impossible or impractical to
complete prior to the Closing Date.
F. Section 9.8 of the Purchase Agreement provides that the Purchase Agreement may be
amended in a writing signed by Buyer and Seller.
G. The Parties desire to further amend the Purchase Agreement as set forth in this Second
Amendment.
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AMENDMENT
NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration,
the receipt and sufficiency of which hereby are acknowledged, and intending to be legally bound
hereby, the Parties agree to amend the Purchase Agreement as follows:
1. Amendments.
a. Recital A of the Purchase Agreement hereby is deleted in its entirety and replaced with the
following:
“A. Seller owns one hundred percent (100%) of the outstanding membership interests of
Xxxxxx Ranch Holdings I LLC, a Delaware limited liability company (“Xxxxxx Ranch Holdings
I”). Xxxxxx Ranch Holdings I owns one hundred percent (100%) of the outstanding membership
interests of Xxxxxx Ranch Holdings II LLC, a Delaware limited liability company (“Xxxxxx
Ranch Holdings II”). Xxxxxx Ranch Holdings II owns one hundred percent (100%) of the
outstanding membership interests of Xxxxxx Ranch Coal LLC, a Delaware limited liability
company (“Xxxxxx Ranch”). Seller, though its indirect ownership of Xxxxxx Ranch, owns and
operates the Mine and, through its indirect ownership of one hundred percent (100%) of the
outstanding membership interests in Xxxxxx Land & Livestock LLC, a Delaware limited
liability company (the “Subsidiary”), owns or controls certain Mineral and/or Real
Properties (collectively, the “Business”).”
b. Section 1.1(d) of the Purchase Agreement hereby is deleted in its entirety and
replaced with the following:
“”Arch Coal Supply Agreements” means the agreements in substantially the forms
attached to this Agreement as Exhibit A-1 and Exhibit A-2.
c. Section 1.1(oo) of the Purchase Agreement hereby is deleted in its entirety and
replaced with the following:
“”Equity Interests” means the membership interests of Xxxxxx Ranch Holdings I held by
Seller.”
d. Section 1.1(nnnnn) of the Purchase Agreement hereby is amended by deleting the
phrase “Section 2.6(g)” and replacing it with “Section 2.6(f)”.
e. Section 2.2 of the Purchase Agreement hereby is amended by deleting the phrase “11:59:59
p.m.” and replacing it with “12:00:01 a.m.”.
f. The phrase “ending after the Closing Date” is hereby deleted from the second and third
lines of Section 3.10(k) of the Purchase Agreement and is hereby replaced with “ending
after September 30, 2009.”
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g. The phrase “on or prior to the Closing Date” is hereby deleted from the fourth, fifth and
sixth lines of Section 3.10(k) of the Purchase Agreement, the fifth line of Section
3.12(e) of the Purchase Agreement, the second line of Section 5.14(a) of the Purchase
Agreement, the fourteenth line of Section 5.14(e) of the Purchase Agreement, the third line
of Section 5.14(f) of the Purchase Agreement, the sixth line of Section 5.14(g) of
the Purchase Agreement and is hereby replaced with “prior to the Closing Date.”
h. The phrase “on the Closing Date” is hereby deleted from Section 5.8(b) of the
Purchase Agreement, the fifth line of Section 5.14(a) of the Purchase Agreement and is
hereby replaced with “immediately prior to the Closing Date.”
i. The phrase “on the Closing Date” is hereby deleted from the fifth line of Section
5.14(a) of the Purchase Agreement and is hereby replaced with “on September 30, 2009.”
j. The phrase “up to and including the Closing Date” in the thirteenth line of Section
5.14(a) of the Purchase Agreement is hereby deleted, and is hereby replaced with “up to the
Closing Date.”
k. All references to the phrase “the Closing Date” in Section 5.14(c) and Section
5.14(d) of the Purchase Agreement are hereby deleted and are hereby replaced with “September
30, 2009.”
l. The phrase “after the Closing Date” in the seventh line of Section 5.8(c) of the
Purchase Agreement, the second line of Section 5.14(a) of the Purchase Agreement, the
second line of Section 5.14(g) of the Purchase Agreement and the first line of Section
8.2(c) is hereby deleted and is hereby replaced with “on or after the Closing Date.”
m. The phrase “on or before the Closing Date” is hereby deleted from the third and fourth
lines of Section 3.12(e) of the Purchase Agreement, the first line of Section 5.8(d) of the
Purchase Agreement, and is hereby replaced with “prior to the Closing Date.”
n. The phrase “as of the Closing Date” is hereby deleted from Section 1.1(o) of the
Purchase Agreement, the second line of Section 5.8(a) of the Purchase Agreement, the third,
sixth and eighth lines of Section 5.8(d) and Section 5.8(e) of the Purchase
Agreement and is hereby replaced with “as of September 30, 2009.”
o. The word “Date” in the title of Section 8.7 is hereby deleted.
p. Section 2.6(f) of the Purchase Agreement hereby is deleted in its entirety and
replaced with the following:
“(f) the Arch Coal Supply Agreements, executed by Rio Tinto Energy America
Inc., a Delaware corporation (“RTEA”) or an Affiliate of RTEA, as applicable;”
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q. Section 2.6(g) of the Purchase Agreement hereby is deleted in its entirety and
replaced with the following:
“(g) the Tire Allocation Assignment, executed by Rio Tinto Energy America
Services Company, a Delaware corporation;”
r. Section 3.1(c) of the Purchase Agreement hereby is amended by deleting the phrase
“, as of the Effective Date,” beginning in the first line thereof.
s. Section 3.2(a) of the Purchase Agreement hereby is deleted in its entirety and
replaced with the following:
“(a) Xxxxxx Ranch Holdings I is a limited liability company formed under the
laws the State of Delaware on June 17, 2009. Xxxxxx Ranch Holdings II is a limited
liability company formed under the laws of the State of Delaware on June 17, 2009.
The Equity Interests, and the membership interests of Jacob Ranch Holdings II,
Xxxxxx Ranch and the Subsidiary, have been legally and validly issued and all
legally required contributions have been made under the applicable Organizational
Document of each of the Companies.”
t. Section 3.2(b) of the Purchase Agreement hereby is amended by deleting the phrase
“Xxxxxx Ranch” and replacing it with “Xxxxxx Ranch Holdings I”.
u. Section 3.2(e) of the Purchase Agreement hereby is deleted in its entirety and
replaced with the following:
“(e) Xxxxxx Ranch Holdings I owns 100% of the outstanding membership interests
of Xxxxxx Ranch Holdings II. Except for the direct ownership of membership
interests by Xxxxxx Ranch Holdings I in Xxxxxx Ranch Holdings II and the indirect
ownership of membership interests by Xxxxxx Ranch Holdings I in Xxxxxx Ranch and
the Subsidiary, Xxxxxx Ranch Holdings I does not own, and has not owned, any
capital stock, membership interests or other equity or debt securities of any other
Person, or any other assets. Jacob Ranch Holdings II owns 100% of the outstanding
membership interests of Xxxxxx Ranch. Except for the direct ownership of
membership interests of Xxxxxx Ranch Holdings II in Xxxxxx Ranch and the indirect
ownership of membership interests by Xxxxxx Ranch Holdings II in the Subsidiary,
Xxxxxx Ranch Holdings II does not own, and has not owned, any capital stock,
membership interests or other equity or debt securities of any other Person, or any
other assets. Xxxxxx Ranch owns 100% of the outstanding membership interests of
the Subsidiary. Except for the ownership of Xxxxxx Ranch in the Subsidiary, Xxxxxx
Ranch does not own, directly or indirectly, any capital stock, membership interests
or other equity or debt securities of any other Person. The Subsidiary does not
own, directly or indirectly, any capital stock, membership interests or other
equity or debt securities of any other
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Person. Other than its ownership of Xxxxxx Ranch Holdings II, Xxxxxx Ranch
Holdings I has no operations of any kind. Other than its ownership of Xxxxxx
Ranch, Xxxxxx Ranch Holdings II has no operations of any kind.”
v. The phrase “XXXXXX RANCH” in the sixth line of Section 4.9 of the Purchase
Agreement hereby is deleted and replaced with the phrase ”XXXXXX RANCH HOLDINGS I”.
w. The word “either” hereby is deleted in the second line of Section 1.1(w) of the
Purchase Agreement, the first line of Section 1.1(x) of the Purchase Agreement, the last
line of Section 1.1(hh) of the Purchase Agreement, the fifteenth line of Section
1.1(iiii) of the Purchase Agreement, the second line of Section 1.1(jjjj) of the
Purchase Agreement, the fourth line of Section 2.2(b) of the Purchase Agreement, the eighth
line of Section 2.3(a) of the Purchase Agreement, the second line of Section 2.6(j)
of the Purchase Agreement, the second line of Section 2.6(l) of the Purchase Agreement, the
third line of Section 3.2(c) of the Purchase Agreement, the second line of Section
3.4(a) of the Purchase Agreement, the second line of Section 3.4(c) of the Purchase
Agreement, the eleventh line of Section 3.5(c) of the Purchase Agreement, the second and
fourth lines of Sections 3.8(b) of the Purchase Agreement, the first line of Section
3.8(c) of the Purchase Agreement, the second line of Section 3.8(d) of the Purchase
Agreement, the fourth line of Section 3.10(b) of the Purchase Agreement, the second line of
Section 3.10(g) of the Purchase Agreement, the second line of Section 3.10(j) of
the Purchase Agreement, the sixth and ninth lines of Section 3.12(a) of the Purchase
Agreement, the second, third, fifth and seventh lines of Section 3.14(c) of the Purchase
Agreement, the third line of Section 3.14(d) of the Purchase Agreement, the fifth line of
Section 3.16(a) of the Purchase Agreement, the eighth line of Section 3.18 of the
Purchase Agreement, the second line of Section 5.6(c) of the Purchase Agreement, the third
line of Section 5.6(k) of the Purchase Agreement, the first line of Section 5.6(n)
of the Purchase Agreement, the second line of Section 5.14(h) of the Purchase Agreement,
and the second line of Section 8.2(b) of the Purchase Agreement, and replaced with the word
“any”.
x. The word “neither” hereby is deleted in the seventh line of Section 3.5(c) of the
Purchase Agreement, the first line of Section 3.11(a)(i) of the Purchase Agreement, the
third line of Section 3.15(a) of the Purchase Agreement, and the first line of Section
3.15(b) of the Purchase Agreement and replaced with the word “none”.
y. The word “neither” hereby is deleted in the second line of Section 3.16(a) of the
Purchase Agreement, and the second line of Section 3.16(b) of the Purchase Agreement, and
replaced with the word “no”.
z. The phrase “, Xxxxxx Ranch Holdings I, Xxxxxx Ranch Holdings II,” hereby is inserted after
the phrase “Xxxxxx Ranch” in the first line of Section 1.1(w) of the Purchase Agreement,
the fourth, sixth, seventh, ninth and tenth lines of Section 1.1(jjjj) of the Purchase
Agreement, the first line of Section 3.6(b)(ii) of the Purchase Agreement,
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the second, seventh, eleventh and sixteenth lines of Section 3.7(b) of the Purchase
Agreement, the tenth line of Section 3.12(a) of the Purchase Agreement, the first line of
Section 3.14(b) of the Purchase Agreement, the first and third lines of Section
3.14(j) of the Purchase Agreement, the first and second lines of Section 3.14(k) of the
Purchase Agreement, the third, fifth and ninth lines of Section 3.20 of the Purchase
Agreement, the second line of Section 5.6(j) of the Purchase Agreement, the third line in
Section 5.6(m) of the Purchase Agreement, and the second, fourth, fifth and twelfth lines
of Section 5.16(b) of the Purchase Agreement.
aa. The phrase “Xxxxxx Ranch Holdings I, Xxxxxx Ranch, or” hereby is inserted before the
phrase “the Subsidiary” in the second line of Section 5.6(k) of the Purchase Agreement, and
the sixth line of Section 5.10(d) of the Purchase Agreement.
bb. The phrase “and Coal Leases” hereby is deleted from the heading in the first line of
Section 5.1(b)(i) of the Purchase Agreement, and from the third and seventh lines of
Section 5.1(b)(i) of the Purchase Agreement.
cc. The phrase “or Coal Leases” hereby is deleted from the fourth line of Section
5.1(b)(i) of the Purchase Agreement.
dd. The phrase “Arch Coal Supply Agreement” hereby is deleted from the fourth line of
Section 2.6(j), the first line of Section 2.7(a)(v), the tenth line of Section
5.1(b)(ii) and replaced with the phrase “Arch Coal Supply Agreements”.
ee. Section 5.3 of the Purchase Agreement hereby is amended (i) by replacing the
phrase “shall be effective as of the Closing Date” in the first sentence thereof with the phrase
“shall be posted on or before the Closing Date and shall be effective as of the Closing Date” and
(ii) by replacing the phrase “, and shall obtain the release of all of the Existing Surety Bonds in
connection therewith” in the first sentence thereof with the phrase “, and shall use Commercially
Reasonable Efforts to obtain the release of all of the Existing Surety Bonds in connection
therewith as soon as possible after the Closing Date.”
ff. Section 5.4 of the Purchase Agreement hereby is amended (i) by inserting the
phrase “, including any Existing Guaranty related to Coal Sales Contracts covered by the Arch Coal
Supply Agreements,” after the phrase “Closing Date” in the fifth line, the eleventh line and the
eighteenth line thereof, and (ii) by inserting the phrase “in respect of Buyer or its Affiliates
(including, if Closing occurs, one or more of the Companies)” after the phrase “Liabilities” in the
twelfth line thereof.
gg. The last sentence of Section 5.16(c) of the Purchase Agreement is hereby deleted
in its entirety and replaced with the following:
“Seller shall use Commercially Reasonable Efforts to collect, and assist Buyer in the
collection of, all such accounts receivable as the same become due, and shall remit to Buyer as
promptly as possible any and all amounts received from any third parties with respect to such
accounts receivable in accordance with Section 3 of the Arch Coal Supply Agreement, attached hereto
as Exhibit A-1, and in accordance with Section 2 of the Arch
Coal Supply Agreement, attached hereto as Exhibit A-2, in each case, without any right
of set off by Seller.”
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hh. Section 8.1 of the Purchase Agreement hereby is amended by deleting “and” at the
end of clause (c), by replacing the period at the end of clause (d) with “; and” and by adding the
following new clause (e):
“(e) any Liability arising from Seller’s internal reorganization of the
ownership of Xxxxxx Ranch through (i) the formation of Xxxxxx Ranch Holdings II,
(ii) the formation of Xxxxxx Ranch Holdings I and (iii) the transfer of all of the
membership interests of Xxxxxx Ranch from Seller to Xxxxxx Ranch Holdings II.”
ii. Section 9.3 of the Purchase Agreement hereby is amended by deleting “or” at the
end of clause (A)(i) and replacing it with “,”, by adding by “or” after the comma at the end of
clause (A)(ii), and by adding the following new clause (iii):
“(iii) in case of an assignment and/or delegation in whole or in part to the
immediate corporate parent of such Party,”
jj. All new definitions to the Purchase Agreement included in this Second Amendment hereby are
inserted in alphabetical order into Section 1.1 of the Purchase Agreement, the section
numbers in Section 1.1 are renumbered accordingly, and, as appropriate, references to such
section numbers in the Purchase Agreement are revised accordingly.
kk. The Arch Coal Supply Agreement attached to the Purchase Agreement as Exhibit A
hereby is deleted in its entirety and replaced with (i) the agreement attached to this Second
Amendment as Exhibit A-1; and (ii) the agreement attached to this Second Amendment as
Exhibit A-2.
ll. Exhibit D to the Purchase Agreement hereby is amended by (i) deleting the
reference to “BLM, Federal Coal Leases (see Section 3.5(a)) – 43 C.F.R. Part 3453.” under the
heading of “Federal Coal Leases” and replacing it with “None.”; (ii) deleting the reference to
“Federal Communications Commission, Transmitters Licenses (see Section 3.6) – 47 U.S.C. § 310(d);
47 C.F.R. § 1.948” and replacing it with “Federal Communications Commission, Radio Station
Authorizations (see Section 3.6) – 47 U.S.C. §310(d); 47 C.F.R. § 1.948”; and (iii) by deleting the
references to (A) “Mine Safety & Health Administration, Legal Identity 48-00997-MSHA Form 2000-7,
available at xxxx://xxx.xxxx.xxx/xxxxx/xxxxxxxxxx/0000-0.xxx”; (B) “Wyoming DEQ, Land Quality
Division Permit to Mine, Permit 271 – See Wyo. Stat. Xxx. § 00-00-000 et seq.; Wyo. Dept. Envtl.
Quality, Land Quality R. & Regs., Ch. 1, 2, 12 & 13; Wyo. Dept. Envtl. Quality, Land Quality, Coal
Standard Operating Procedure Nos. 1.8 & 1.9”; and (C) “Wyoming DEQ, Land Quality Division License
to Mine, License numbers 271-T1-L1, 271-L2, and 271-L3 — See Wyo. Stat. Xxx. § 00-00-000 et seq.;
Wyo. Dept. Envtl. Quality, Land Quality R. & Regs., Ch. 1, 2, 12 & 13; Wyo. Dept. Envtl. Quality,
Land
Quality, Coal Standard Operating Procedure Nos. 1.8 & 1.9” under the heading of “Environmental
Permits”.
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mm. Exhibit E to the Purchase Agreement hereby is amended by (i) deleting
“US$10,863,892” as the Reference Net Working Capital and replacing it with “US$10,442,154”; (ii)
deleting the Sample Calculation appended to Exhibit E as Appendix 1 and replacing it with
the Sample Calculation attached to this Second Amendment as Appendix 1, and (iii) adding a new
clause (xi) to Section 9(a):
“(xi) Any accruals for freight under the Confidential Rail Transportation Agreement
BNSF-C-12373 between the Burlington Northern and Santa Fe Railway Company and Kennecott Coal Sales
Company.”
2. Miscellaneous.
a. Words, terms and phrases that begin with initial capital letters used, but not specifically
defined in, this Second Amendment shall have the same meaning ascribed to such words, terms or
phrases in the Purchase Agreement.
b. Except as otherwise specifically provided in this Second Amendment, the terms and
conditions of the Purchase Agreement shall remain in full force and effect.
c. This Second Amendment shall be governed by and construed in accordance with the Laws of the
State of Colorado, excluding conflicts of law principles thereof that would require or permit the
application of the Laws of a different jurisdiction.
d. This Second Amendment may be executed in counterparts, each of which shall be deemed to be
an original, but all of which shall constitute one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the Parties and delivered
(including by facsimile or other electronic transmission) to the other Parties as required
hereunder.
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IN WITNESS WHEREOF, THE Parties have caused this Second Amendment to be executed as of the
date first above written.
SELLER: | ||||||
Rio Tinto Sage LLC, a Delaware limited liability company |
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By: Name: |
/s/ X.X. Xxxxxx
|
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Title: | Authorized Agent | |||||
BUYER: | ||||||
Arch Coal, Inc., a Delaware corporation |
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By: Name: |
/s/ Xxxxx Xxxxx
|
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Title: | V.P. Business Development |
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