Exhibit 10.12
FIRST AMENDMENT TO
CREDIT AGREEMENT
between
MIDCOAST INTERSTATE TRANSMISSION, INC.
F/K/A ALABAMA TENNESSEE NATURAL GAS COMPANY
and
BANK ONE, TEXAS, N.A.
Effective as of
October 31, 1997
TABLE OF CONTENTS
PAGE
ARTICLE I.DEFINITIONS 1
1.01Terms Defined Above 1
1.02Terms Defined in Agreement 1
1.03References 1
1.04Articles and Sections 1
1.05Number and Gender 1
ARTICLE II.AMENDMENTS 2
2.01Amendment of Section 1.2 2
2.02Amendment of Section 2.7 3
2.03Amendment of Section 7.14
ARTICLE III.CONDITIONS 4
3.01Receipt of Documents 4
3.02Accuracy of Representations and Warranties 4
3.03Matters Satisfactory to Lender 4
ARTICLE IV. REPRESENTATIONS AND WARRANTIES 4
ARTICLE V.RATIFICATION 4
ARTICLE VI.MISCELLANEOUS 4
6.01Scope of Amendment 5
6.02Agreement as Amended 5
6.03Parties in Interest 5
6.04Rights of Third Parties 5
6.05ENTIRE AGREEMENT 5
6.06GOVERNING LAW 5
6.07JURISDICTION AND VENUE 5
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "First Amendment") is
made and entered into effective as of October 31, 1997, between MIDCOAST
INTERSTATE TRANSMISSION, INC., F/K/A ALABAMA TENNESSEE NATURAL GAS COMPANY, an
Alabama corporation (the "Borrower") and BANK ONE, TEXAS, N.A., a national
banking association (the "Lender").
W I T N E S S E T H:
WHEREAS, the above named parties did execute and exchange counterparts
of that certain Credit Agreement dated May 30, 1997 (the "Agreement"), to
which reference is here made for all purposes;
WHEREAS, the parties subject to and bound by the Agreement are desirous
of amending the Agreement in the particulars hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
of the parties to the Agreement, as set forth therein, and the mutual
covenants and agreements of the parties hereto, as set forth in this First
Amendment, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
1.01Terms Defined Above. As used herein, each of the terms
"Agreement," "Borrower," "First Amendment," and "Lender" shall have the
meaning assigned to such term hereinabove.
1.02Terms Defined in Agreement. As used herein, each term defined in
the Agreement shall have the meaning assigned thereto in the Agreement, unless
expressly provided herein to the contrary.
1.03References. References in this First Amendment to Article or
Section numbers shall be to Articles and Sections of this First Amendment,
unless expressly stated herein to the contrary. References in this First
Amendment to "hereby," "herein," "hereinafter," "hereinabove," "hereinbelow,"
"hereof," and "hereunder" shall be to this First Amendment in its entirety and
not only to the particular Article or Section in which such reference appears.
1.04Articles and Sections. This First Amendment, for convenience
only, has been divided into Articles and Sections and it is understood that
the rights, powers, privileges, duties, and other legal relations of the
parties hereto shall be determined from this First Amendment as an entirety
and without regard to such division into Articles and Sections and without
regard to headings prefixed to such Articles and Sections.
1.05Number and Gender. Whenever the context requires, reference
herein made to the single number shall be understood to include the plural and
likewise the plural shall be understood to include the singular. Words
denoting sex shall be construed to include the masculine, feminine, and
neuter, when such construction is appropriate, and specific enumeration shall
not exclude the general, but shall be construed as cumulative. Definitions of
terms defined in the singular and plural shall be equally applicable to the
plural or singular, as the case may be.
ARTICLE II.
AMENDMENTS
The Borrower and the Lender hereby amend the Agreement in the following
particulars:
2.01Amendment of Section 1.2. Section 1.2 of the Agreement is hereby
amended as follows:
The following definitions are added to read as follows:
"Borrower" shall mean Midcoast Interstate Transmission, Inc., an Alabama
corporation f/k/a Alabama Tennessee Natural Gas Company.
"Midcoast Credit Facility" shall mean that certain Credit Agreement
dated August 22, 1996, as amended, modified or supplemented from time to time
including, but not limited to, that certain Second Amendment to Credit
Agreement dated October 31, 1997 among Midcoast Energy Resources, Inc., a
Nevada corporation, Magnolia Pipeline Corporation, an Alabama corporation, H&W
Pipeline Corporation, an Alabama corporation, Magnolia Resources, Inc., a
Mississippi corporation, Magnolia Gathering, Inc., an Alabama corporation,
Midcoast Holdings No. One, Inc., a Delaware corporation, Midcoast Gas
Pipeline, Inc., a Texas corporation, Nugget Drilling Corporation, a Minnesota
corporation, Midcoast Marketing, Inc., a Texas corporation, Alatenn Energy
Marketing Company, an Alabama corporation, Tennessee River Intrastate Gas Co.,
an Alabama corporation, Mid Louisiana Gas Company, a Delaware corporation, Mid
Louisiana Marketing Company, a Delaware corporation, Mid Louisiana Gas
Transmission Company, a Delaware corporation, and Midla Energy Services
Company, a Delaware corporation and Lender, as the same may be amended,
modified or supplemented from time to time.
The following definitions are amended to read as follows:
"Applicable Margin" shall mean, for the period from and after September
2, 1997, as to each LIBO Rate Loan one and one-half percent (1-1/2%) when the
Loan Balance is less than 50% of the Borrowing Base and one and three-quarters
percent (1-3/4%) when the Loan Balance is greater than 50% of the Borrowing
Base.
"Commitment Termination Date" shall mean August 22, 2000.
"Interest Period" shall mean, subject to the limitations set forth in
Section 2.19, with respect to any LIBO Rate Loan, a period commencing on the
date such Loan is made or converted from a Loan of another type pursuant to
this Agreement or the last day of the next preceding Interest Period with
respect to such Loan and ending on the numerically corresponding day in the
calendar month that is one, two, three or six months thereafter, as the
Borrower may request in the Borrowing Request for such Loan.
"Obligations" shall mean, without duplication, (a) all Indebtedness
evidenced by the Note, (b) the obligation of the Borrower for the payment of
Commitment Fees and Facility Fees, (c) the obligation of the Guarantor under
the Guaranty, (d) the obligations arising out of or related to the Midcoast
Credit Facility, and (e) all other obligations and liabilities of the Borrower
and/or its Affiliates to the Lender, now existing or hereafter incurred,
under, arising out of or in connection with any Loan Document or the Midcoast
Credit Facility, and to the extent that any of the foregoing includes or
refers to the payment of amounts deemed or constituting interest, only so much
thereof as shall have accrued, been earned and which remains unpaid at each
relevant time of determination.
2.02Amendment of Section 2.7. Section 2.7 of the Agreement is amended
to read as follows:
"2.7Borrowing Base Determinations. (a) The Borrowing Base as of
October 31, 1997 is acknowledged by the Borrower and the Lender to be
$5,000,000. The Borrowing Base is determined by the Lender in its sole
discretion and based on contracts that are acceptable to the Lender.
Commencing on the date hereof, and continuing thereafter on the first day of
each calendar month through the Commitment Termination Date, the amount of the
Borrowing Base shall be reduced by $0, provided, however, that such amount is
subject to redetermination under Section 2.8(b).
(b)The Borrowing Base shall be redetermined semi-annually
beginning August 1, 1997, on the basis of information supplied by the Borrower
in compliance with the provisions of this Agreement, including, without
limitation, engineering reports as available, contracts in connection with
Borrower's pipeline systems, and all other information available to the
Lender. Notwithstanding the foregoing, the Lender may at its discretion
redetermine the Borrowing Base.
(c)Upon each determination of the Borrowing Base by the Lender,
the Lender shall notify the Borrower orally (confirming such notice promptly
in writing) of such determination, and the Borrowing Base so communicated to
the Borrower shall become effective upon such oral notification and shall
remain in effect until the next subsequent determination of the Borrowing
Base.
(d)The Borrowing Base shall represent the determination by the
Lender, in accordance with the applicable definitions and provisions herein
contained and its customary lending practices for loans of this nature, of the
value, for loan purposes, of the Mortgaged Properties, subject, in the case of
any increase in the Borrowing Base, to the credit approval process of the
Lender. Furthermore, the Borrower acknowledges that the determination of the
Borrowing Base contains an equity cushion (market value in excess of loan
value), which is acknowledged by the Borrower to be essential for the adequate
protection of the Lender."
2.03Amendment of Section 7.1. Section 7.1 of the Agreement is hereby
amended by adding the following:
"(n)The occurrence of an Event of Default under the Midcoast
Credit Facility."
ARTICLE III.
CONDITIONS
The obligation of the Lender to amend the Agreement as provided herein
is subject to the fulfillment of the following conditions precedent:
3.01Receipt of Documents. The Lender shall have received, reviewed,
and approved the following documents and other items, appropriately executed
when necessary and in form and substance satisfactory to the Lender:
(a)multiple counterparts of this First Amendment, as requested by the
Lender;
(b)Notice of Final Agreement;
3.02Accuracy of Representations and Warranties. The representations
and warranties contained in Article IV of the Agreement and this First
Amendment shall be true and correct.
3.03Matters Satisfactory to Lender. All matters incident to the
consummation of the transactions contemplated hereby shall be satisfactory to
the Lender.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
The Borrower hereby expressly re-makes, in favor of the Lender, all of
the representations and warranties set forth in Article IV of the Agreement,
and represents and warrants that all such representations and warranties
remain true and unbreached.
ARTICLE V.
RATIFICATION
Each of the parties hereto does hereby adopt, ratify, and confirm the
Agreement and the other Loan Documents, in all things in accordance with the
terms and provisions thereof, as amended by this First Amendment.
ARTICLE VI.
MISCELLANEOUS
6.01Scope of Amendment. The scope of this First Amendment is
expressly limited to the matters addressed herein and this First Amendment
shall not operate as a waiver of any past, present, or future breach, Default,
or Event of Default under the Agreement, except to the extent, if any, that
any such breach, Default, or Event of Default is remedied by the effect of
this First Amendment.
6.02Agreement as Amended. All references to the Agreement in any
document heretofore or hereafter executed in connection with the transactions
contemplated in the Agreement shall be deemed to refer to the Agreement as
amended by this First Amendment.
6.03Parties in Interest. All provisions of this First Amendment shall
be binding upon and shall inure to the benefit of the Borrower, the Lender and
their respective successors and assigns.
6.04Rights of Third Parties. All provisions herein are imposed solely
and exclusively for the benefit of the Lender and the Borrower, and no other
Person shall have standing to require satisfaction of such provisions in
accordance with their terms and any or all of such provisions may be freely
waived in whole or in part by the Lender at any time if in its sole discretion
it deems it advisable to do so.
6.05ENTIRE AGREEMENT. THIS FIRST AMENDMENT CONSTITUTES THE ENTIRE
AGREEMENT BETWEEN THE PARTIES HERETO WITH RESPECT TO THE SUBJECT HEREOF AND
SUPERSEDES ANY PRIOR AGREEMENT, WHETHER WRITTEN OR ORAL, BETWEEN SUCH PARTIES
REGARDING THE SUBJECT HEREOF. FURTHERMORE IN THIS REGARD, THIS FIRST
AMENDMENT, THE AGREEMENT, THE NOTE, THE SECURITY INSTRUMENTS, AND THE OTHER
WRITTEN DOCUMENTS REFERRED TO IN THE AGREEMENT OR EXECUTED IN CONNECTION WITH
OR AS SECURITY FOR THE NOTE REPRESENT, COLLECTIVELY, THE FINAL AGREEMENT AMONG
THE PARTIES THERETO AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
6.06GOVERNING LAW. THIS FIRST AMENDMENT, THE AGREEMENT AND THE NOTE
SHALL BE DEEMED TO BE CONTRACTS MADE UNDER AND SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS WITHOUT GIVING
EFFECT TO PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW; PROVIDED, HOWEVER,
THAT VERNON'S TEXAS CIVIL STATUTES, ARTICLE 5069, CHAPTER 15 (WHICH REGULATES
CERTAIN REVOLVING CREDIT LOAN ACCOUNTS AND REVOLVING TRIPARTY ACCOUNTS) SHALL
NOT APPLY.
6.07JURISDICTION AND VENUE. ALL ACTIONS OR PROCEEDINGS WITH RESPECT
TO, ARISING DIRECTLY OR INDIRECTLY IN CONNECTION WITH, OUT OF, RELATED TO, OR
FROM THIS FIRST AMENDMENT, THE AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE
LITIGATED IN COURTS HAVING SITUS IN XXXXXX COUNTY, TEXAS. EACH OF THE
BORROWER AND THE LENDER HEREBY SUBMITS TO THE JURISDICTION OF ANY LOCAL,
STATE, OR FEDERAL COURT LOCATED IN XXXXXX COUNTY, TEXAS, AND HEREBY WAIVES ANY
RIGHTS IT MAY HAVE TO TRANSFER OR CHANGE THE JURISDICTION OR VENUE OF ANY
LITIGATION BROUGHT AGAINST IT BY THE BORROWER OR THE LENDER IN ACCORDANCE WITH
THIS SECTION.
IN WITNESS WHEREOF, this First Amendment to Credit Agreement is executed
effective the date first hereinabove written.
BORROWER:
MIDCOAST INTERSTATE TRANSMISSION,
INC., F/K/A ALABAMA TENNESSEE
NATURAL GAS COMPANY
By:
Xxxxxxx Xxxxxx
Chief Financial Officer and
Treasurer
LENDER:
BANK ONE, TEXAS, N.A.
By:
Xxxxxxx Xxxxxxxxx-Xxxxx
Senior Vice President
