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OXF > SEC Filings for OXF > Form 8-K on 25-Jun-2013All Recent SEC Filings

Show all filings for OXFORD RESOURCE PARTNERS LP

Form 8-K for OXFORD RESOURCE PARTNERS LP


25-Jun-2013

Entry into a Material Definitive Agreement, Creation of a Direct Fina


Item 1.01 Entry into a Material Definitive Agreement.

First Lien Financing Agreement

On June 24, 2013 (the "Refinancing Date"), Oxford Resource Partners, LP (the "Partnership"), along with Oxford Mining Company, LLC ("Oxford Mining," and together with each other person that becomes a borrower thereunder, the "First Lien Borrowers") and each subsidiary of the Partnership listed as a guarantor (together with the Partnership and each other person that becomes a guarantor thereunder, the "First Lien Guarantors," and together with the First Lien Borrowers, the "First Lien Loan Parties") entered into a first lien financing agreement (the "First Lien Financing Agreement") with the lenders party thereto (collectively, the "First Lien Lenders") and Cerberus Business Finance, LLC, a Delaware limited liability company ("Cerberus"), as collateral agent and administrative agent for the First Lien Lenders.

Pursuant to the First Lien Financing Agreement, the First Lien Lenders extended to the First Lien Borrowers credit consisting of (a) a $75,000,000 term loan and
(b) a $25,000,000 revolving credit facility, which revolving credit facility under the First Lien Financing Agreement includes a subfacility for the issuance of letters of credit. The term loan and the revolving credit facility will mature in 2015 and may be extended by Oxford Mining according to their respective terms. The borrowings under the First Lien Financing Agreement will bear interest at a rate per annum equal to, at the option of the First Lien Borrowers, the specified Reference Rate or LIBOR Rate, as the case may be, plus the Applicable Margin (for these purposes, LIBOR, Reference Rate, LIBOR Rate and Applicable Margin are defined in the First Lien Financing Agreement). The borrowings are guaranteed by the First Lien Guarantors and secured by a first-priority lien on and security interest in substantially all of the assets of the First Lien Loan Parties.

The First Lien Financing Agreement contains customary affirmative covenants and negative covenants, including restrictions on each First Lien Loan Party's ability to incur additional liens or indebtedness, make fundamental changes or dispositions, make changes in the nature of its business, make certain investments, loans or advances, pay dividends or other distributions, create certain lease obligations, make capital expenditures in excess of a certain amount, enter into transactions with affiliates, issue equity interests, and modify indebtedness, organizational and certain other documents. The restriction regarding dividends or other distributions precludes the Partnership from making unitholder distributions during the term of the First Lien Financing Agreement.

The First Lien Financing Agreement also requires the First Lien Loan Parties to comply with certain financial covenants, including financial covenants:

? limiting the "senior leverage ratio" (i.e., the ratio of (a) the sum of the outstanding principal amount of all revolving loans, all letter of credit obligations and the outstanding principal balance of the term loan under the First Lien Financing Agreement to (b) consolidated adjusted EBITDA) of the Partnership and its wholly owned subsidiaries;


? limiting the "total leverage ratio" (i.e., the ratio of (a) the sum of (i) the . . .



Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The disclosure of the Financing Agreements and the Intercreditor Agreement set forth in Item 1.01 above are incorporated in this Item 2.03 by reference.



Item 3.02 Unregistered Sales of Equity Securities.

The disclosure with respect to the Warrants set forth in Item 1.01 above is incorporated in this Item 3.02 by reference.



Item 5.01 Changes in Control of Registrant.

The disclosure of the Amendment to Existing Investors' Rights Agreement and the Additional Investors' Rights Agreement set forth in Item 1.01 above are incorporated in this Item 5.01 by reference.



Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On the Refinancing Date, in connection with the Financing Transactions, the General Partner and Charles C. Ungurean (the "Executive") entered into a new employment agreement (the "New Employment Agreement") to replace and supersede the Executive's employment agreement entered into as of March 29, 2013 (the "Existing Employment Agreement"). The only modifications to the Existing Employment Agreement effected by the New Employment Agreement are with respect to the initial expiration date of the Executive's employment with the General Partner and the Executive's right to terminate employment. Under the New Employment Agreement, the parties have mutually agreed that the initial expiration date of the Executive's employment will be the later of (a) December 31, 2016 and (b) the date of repayment of the obligations in full under the Financing Agreements and the termination of the Financing Agreements, subject to the same conditions as provided in the Existing Employment Agreement. In addition, while the Executive will still have the right to terminate his employment for certain good reasons, he will not have the right to terminate for any other reason or for no reason, which was previously permitted under the Existing Employment Agreement.

A copy of the New Employment Agreement will be filed as an exhibit to the Partnership's Quarterly Report on Form 10-Q for the quarter ended June 30, 2013.



Item 5.03 Amendments to Articles of Incorporation or Bylaws; Changes in Fiscal Year.

Amendment to Partnership's Limited Partnership Agreement

On the Refinancing Date, in connection with the Second Lien Financing Agreement, the Partnership entered into a First Amendment to Third Amended and Restated Limited Partnership Agreement (the "LPA Amendment"), amending the Partnership's Third Amended and Restated Limited Partnership Agreement


The LPA Amendment was entered into to accommodate the issuance of the Partnership Warrants described above. The amendments implemented by the LPA Amendment include, among other things, amendments relating to the definition of capital contribution, adjustment of capital accounts of partners and the carrying value of Partnership properties, and tax treatment in respect of the Partnership Warrants and the units issued upon exercise of the Partnership Warrants.

The foregoing description is qualified in its entirety by reference to the full text of the LPA Amendment, which is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Amendment to General Partner's Limited Liability Company Agreement

On the Refinancing Date, in connection with the Second Lien Financing Agreement, the holders of a majority interest in the General Partner entered into a First Amendment to Third Amended and Restated Limited Liability Company Agreement (the "LLCA Amendment"), amending the General Partner's Third Amended and Restated Limited Liability Company Agreement (the "LLCA").

The LLCA Amendment was entered into to accommodate governance and other changes provided for in the Second Lien Financing Agreement and the Amendment to Existing Investors' Rights Agreement described above. The amendments implemented by the LLCA Amendment include, among other things, amendments relating to the General Partner's board of directors and the members thereof which enable the Second Lien Lenders to designate a member thereof if they choose, the issuance and exercise of the General Partner Warrants, and the rights and obligations of holders of the General Partner Warrants and the Class B Units issued upon exercise of the General Partner Warrants (the "General Partner Warrant Exercised Units"). In particular, pursuant to the LLCA Amendment:

? The number of directors constituting the Board is authorized to be between three and fifteen.

? All decisions of the Board shall require the affirmative vote of a majority of the directors (including at least one director designated by AIM).

? If the General Partner offers to issue any securities, a holder of General Partner Warrant Exercised Units will have a preemptive right to purchase a portion of such securities in proportion to its holding of units as a percentage of the total outstanding units prior to such issuance. A holder of General Partner Warrants will be deemed to own the General Partner Warrant Exercised Units subject to exercise of such General Partner Warrants for this purpose.

? Without the prior consent of the holders of a majority of the outstanding General Partner Warrant Exercised Units, the General Partner is not allowed to enter into transactions with its affiliates (other than the Partnership) unless such transactions are approved by a majority of the independent directors. A holder of General Partner Warrants will be deemed to own the General Partner Warrant Exercised Units subject to exercise of such General Partner Warrants for this purpose.


? Holders of General Partner Warrants and General Partner Warrant Exercised Units are subject to the tag along and drag along rights according to the terms of the LLCA.

The foregoing description is qualified in its entirety by reference to the full text of the LLCA Amendment, which is filed as Exhibit 3.2 to this Current Report on Form 8-K and is incorporated herein by reference.



Item 7.01 Regulation FD Disclosure.

On June 25, 2013, the Partnership issued a press release announcing that it had closed the Financing Transactions described in this Current Report. A copy of the press release is furnished as Exhibit 99.1 hereto.



Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

3.1 First Amendment to Third Amended and Restated Limited Partnership Agreement of Oxford Resource Partners, LP dated June 24, 2013.

3.2 First Amendment to Third Amended and Restated Limited Liability Company Agreement of Oxford Resources GP, LLC dated June 24, 2013.

99.1 Press Release dated June 25, 2013.


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