Exhibit 10.4
Execution
Exhibit H
GUARANTY, SUBORDINATION AND
CASH COLLATERAL AGREEMENT
THIS CONTINUING GUARANTY,
SUBORDINATION AND CASH COLLATERAL AGREEMENT (this “
Agreement ”), dated as of June 1, 2009, is made
by ATLAS AMERICA, INC., a Delaware corporation (the “
Guarantor ”), in favor of WACHOVIA BANK,
NATIONAL ASSOCIATION, as administrative agent for the Senior
Creditors (the “ Administrative Agent
”).
W I T N E S
S E T H :
WHEREAS, the Senior Creditors have
extended credit to Atlas Pipeline Holdings, L.P., a Delaware
limited partnership (the “ Borrower ”),
pursuant to that certain Revolving Credit Agreement dated as of
July 26, 2006, by and among the Borrower, Atlas Pipeline
Partners GP, LLC, a Delaware limited liability company, as a
guarantor, the financial institutions party thereto from time to
time as Senior Creditors, and Wachovia Bank, National Association,
in its capacity as the issuer of certain letters of credit and as
the Administrative Agent for the Senior Creditors thereunder, and
amended by that certain First Amendment to Revolving Credit
Agreement (the “ First Amendment ”) dated
of even date herewith (such Revolving Credit Agreement, as amended
by the First Amendment, together with the exhibits and schedules
thereto and all extensions, renewals, amendments, substitutions and
replacements thereto and thereof, is herein referred to as the
“ Credit Agreement ”);
WHEREAS, the Guarantor owns,
directly or indirectly (i) all of the issued and outstanding
limited liability company interests of Atlas Pipeline Holdings GP,
LLC, a Delaware limited liability company, the general partner of
the Borrower, and (ii) approximately 64.4% of the issued and
outstanding limited partnership units of the Borrower;
WHEREAS, as a condition precedent to
maintaining credit to the Borrower pursuant to the Credit Agreement
and to the effectiveness of the amendments to the Credit Agreement
set forth in the First Amendment, the Senior Creditors have
required that the Guarantor execute and deliver to the
Administrative Agent, for and on behalf of the Senior Creditors,
this Agreement;
WHEREAS, in consideration for the
execution of this Agreement, the Borrower will issue to the
Guarantor a promissory note in the form attached as Exhibit A (the
“ Guarantee Note ”);
WHEREAS, the Guarantor has
determined that the execution and delivery of this Agreement is in
furtherance of its organizational purposes and in its best interest
and that it will derive substantial benefit, whether directly or
indirectly, from the execution of this Agreement, having regard for
all relevant facts and circumstances; and
WHEREAS, the Guarantor has agreed to
execute and deliver this Agreement to the Administrative Agent, for
the benefit of the Senior Creditors.
NOW THEREFORE, for good and valuable
consideration the receipt of which is hereby acknowledged, and in
order to fulfill the requirements of the First Amendment, the
Guarantor agrees, for the benefit of each Senior Creditor, as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Certain
Terms . The following
capitalized terms when used in this Agreement, including its
preamble and recitals, shall have the following meanings (such
definitions to be equally applicable to the singular and plural
forms thereof):
“ Administrative
Agent ” is defined in the preamble.
“ Agreement
” is defined in the preamble.
“ Borrower
” is defined in the first recital.
“ Cash
Requirement ” means, on any day, 102% of the unpaid
principal balance of the Loans on such day.
“ Collateral
” is defined in Section 5.1 .
“ Credit
Agreement ” is defined in the first
recital.
“ Guarantee Note
” is defined in the fourth recital.
“ Guaranteed
Obligations ” is defined in Section 2.1
.
“ Guarantor
” is defined in the preamble.
“ Guarantor Material
Adverse Effect ” shall mean any material and adverse
effect on (i) the assets, liabilities, financial condition,
business, operations or affairs of the Guarantor and its
consolidated Subsidiaries, taken as a whole, or (ii) the
ability of the Guarantor and its consolidated Subsidiaries, taken
as a whole, to carry out their business, or (iii) the ability
of the Guarantor to meet its obligations under this Agreement on a
timely basis, or (iv) the Administrative Agent’s or the
Senior Creditors’ ability to enforce their rights and
remedies under this Agreement, at law or in equity.
“ Insolvency
Proceeding ” means, with respect to any Person, any
voluntary or involuntary liquidation, dissolution, receivership,
conservatorship, assignment for the benefit of creditors,
bankruptcy, reorganization, arrangement or composition of such
Person (whether or not pursuant to bankruptcy, insolvency or other
similar laws) and any other proceeding under laws for the
protection of debtors involving such Person as a debtor. Unless
otherwise specified, “Insolvency Proceeding” means an
insolvency proceeding of the Borrower or any Obligor.
“ PIK Interest
” means the accrual and capitalization of unpaid interest or
payment in kind with an additional Subordinated Note.
“ Requirements
Account ” is defined in
Section 4.4 .
“ Senior
Creditors ” means the Administrative Agent, the
Lenders, the Issuing Bank and any other Person to whom Indebtedness
is owing.
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“ Subordinated
Notes ” means (a) the note of even date herewith
made by Borrower payable to Guarantor in the original principal
amount of $15,000,000, (b) the Guarantee Note and (c) any
PIK Interest paid with respect to the notes in clauses (a) and
(b).
“ Subordinated
Obligations ” means all indebtedness, obligations or
liabilities owed by any Borrower or any Obligor to the Guarantor
from time to time, including without limitation all indebtedness,
obligations or liabilities evidenced by the Subordinated Notes and
including all principal, interest (including any interest accruing
after the commencement of any Insolvency Proceeding), fees, expense
reimbursement, indemnities or after amounts of any type.
“ Taxes ”
is defined in clause (1) of Section 2.8
.
“ Termination
Date ” means the 91st day following (or, if, for not
less than 91 consecutive days prior to the date on which all
Indebtedness has been paid in cash and satisfied in full, the
Indebtedness shall have been fully secured by Collateral having on
each such day a market value in excess of the Indebtedness
outstanding on such day, then the first day following) the earliest
date after the date hereof on which all Indebtedness has been paid
in cash and satisfied in full and Senior Creditors do not have any
outstanding commitment (whether or not conditioned on the
satisfaction of any condition precedent) under the Loan Documents
to lend money or otherwise extend credit to Borrower or any
Obligor; provided, however, that this Agreement shall continue to
be effective or be reinstated, as though such payment had not been
made, if at any time any payment of any of the Indebtedness is
rescinded or must otherwise be returned by Senior Creditors in
connection with an Insolvency Proceeding involving Borrower or any
Obligor.
“ Triggering
Event ” is defined in Section 4.4
.
“ UCC ”
means the Uniform Commercial Code applicable to the creation of the
security interest provided herein, except to the extent that the
Uniform Commercial Code of another jurisdiction is applicable to
the perfection and effected perfection thereof.
SECTION 1.2 Credit Agreement
Definitions . Unless
otherwise defined herein or the context otherwise requires,
capitalized terms used in this Agreement, including its preamble
and recitals, have the meanings provided in the Credit
Agreement.
ARTICLE II
GUARANTY; WAIVERS
SECTION 2.1
Agreement . The
Guarantor hereby absolutely, unconditionally, and irrevocably
(1) guarantees the full and punctual payment when due, whether
at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise, of all Indebtedness (including
all indebtedness, obligations and liabilities of the Borrower or
any other Obligor now or hereafter existing under the Credit
Agreement, the Notes or each other Loan Document to which the
Borrower or such other Obligor is or may become a party), whether
for principal, interest, fees, expenses or otherwise (including all
such amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the United States
Bankruptcy Code, 11 U.S.C. §362(a), and the operation of
Sections 502(b) and 506(b) of the United States Bankruptcy Code, 11
U.S.C. §502(b) and §506(b)) (“ Guaranteed
Obligations ”); provided, however , that in no
event shall the Guaranteed Obligations (a) include any
additional Loans funded under the Credit Agreement after the date
hereof or any increase in the interest rate under the Credit
Agreement as a result of an amendment to the provisions of the
Credit Agreement or (b) exceed $17,500,000 and
(2) indemnifies and holds harmless each Senior Creditor for
any and all out-
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of-pocket costs and expenses (including
reasonable attorney’s fees and expenses; but limited to fees
and expenses of one firm of primary counsel and one firm of local
counsel for each jurisdiction applicable thereto for all such
Senior Creditors) for all such Senior Creditors) incurred by such
Senior Creditors, as the case may be, in enforcing any rights under
this Agreement. This Agreement constitutes a guaranty of payment
when due and not of collection, and the Guarantor specifically
agrees that it shall not be necessary or required that any Senior
Creditors exercise any right, assert any claim or demand or enforce
any remedy whatsoever against the Borrower or any other Obligor (or
any other Person) before or as a condition to the obligations of
the Guarantor hereunder.
SECTION 2.2 Acceleration of
Agreement . The
Guarantor agrees that, in the event of the occurrence of any event
of the type described in Section 10.01(e), (f) or
(g) of the Credit Agreement, with respect to the
Borrower, any other Obligor or the Guarantor, and if such event
shall occur at a time when any of the Indebtedness may not then be
due and payable by the Borrower due to any automatic stay or other
debtor relief laws, the Guarantor will pay to the Senior Creditors
forthwith the full amount which would be payable hereunder by the
Guarantor if all such Indebtedness were then due and
payable.
SECTION 2.3 Continuing
Unconditional Guaranty . This Agreement shall in all respects be a
continuing, absolute, unconditional and irrevocable guaranty of
payment, and shall remain in full force and effect until all
Indebtedness of the Borrower and each other Obligor has been paid
in full and all obligations of the Guarantor hereunder shall have
been paid in full and all Hedging Agreements have terminated. The
Guarantor may not rescind or revoke its obligations hereunder. The
Guarantor guarantees that the Indebtedness of the Borrower and each
other Obligor will be paid strictly in accordance with the terms of
the Credit Agreement and each other Loan Document under which they
arise, regardless of any law, regulation or order now or hereafter
in effect in any jurisdiction affecting any of such terms or the
rights of any Senior Creditor or any holder of any Note with
respect thereto.
SECTION 2.4 Waivers of Rights
and Defenses . The
guaranty, security interest, subordination and other obligations,
duties and liabilities of the Guarantor under this Agreement shall
be absolute, unconditional and irrevocable irrespective of:
(1) any lack of validity, legality or enforceability of the
Credit Agreement, any Note or any other Loan Document; (2) the
failure of any Senior Creditor or any holder of any Note
(a) to assert any claim or demand or to enforce any right or
remedy against the Borrower, any other Obligor or any other Person
(including any other guarantor) under the provisions of the Credit
Agreement, any Note, any other Loan Document or otherwise, or
(b) to exercise any right or remedy against any other
guarantor of, or collateral securing, any Indebtedness of the
Borrower or any other Obligor; (3) any change in the time,
manner or place of payment of, or in any other term of, all or any
of the Indebtedness of the Borrower or any other Obligor, or any
other extension, compromise or renewal of any Indebtedness of the
Borrower or any other Obligor; (4) any reduction, limitation,
impairment or termination of any Indebtedness of the Borrower or
any other Obligor for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be
subject to (and the Guarantor hereby waives any right to or claim
of) any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality, nongenuineness,
irregularity, compromise, unenforceability of, or any other event
or occurrence affecting, any Indebtedness of the Borrower, any
other Obligor or otherwise; (5) any amendment to, rescission,
waiver, or other modification of, or any consent