THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
This Third Amendment to Amended and Restated Credit Agreement (this
"Amendment") is dated as of December 15, 1997, by and among MAGNUM HUNTER
RESOURCES, INC., a Nevada corporation (the "Borrower"), each Bank (as defined in
the Credit Agreement), BANKERS TRUST COMPANY, individually, as administrative
agent (in such capacity, together with its successors in such capacity, the
"Administrative Agent"), and as an issuing bank, and BANQUE PARIBAS, a French
bank acting through its Houston Agency, individually, as collateral agent (in
such capacity, together with its successors in such capacity, the "Collateral
Agent"), and as documentation agent (in such capacity, together with its
successors in such capacity, the "Documentation Agent").
R E C I T A L S:
WHEREAS, the Borrower, each Bank then a party, the Administrative Agent,
the Documentation Agent, and First Union National Bank ("First Union"), as
collateral agent and syndication agent, entered into that certain Amended and
Restated Credit Agreement dated as of April 30, 1997 (the "Original Credit
Agreement") pursuant to which the Banks have agreed to make revolving credit
loans available to the Borrower under the terms and provisions stated therein;
and
WHEREAS, the parties to the Original Credit Agreement entered into a First
Amendment to Amended and Restated Credit Agreement, Resignation of Collateral
Agent and Appointment of Substitute Collateral Agent dated as of May 29, 1997
(the "First Amendment"); and
WHEREAS, as of October 1, 1997, CIBC, Inc. ("CIBC") became a Bank under the
Original Credit Agreement as amended by the First Amendment; and
WHEREAS, the parties to the Original Credit Agreement and CIBC entered into
a Second Amendment to Amended and Restated Credit Agreement dated as of
September 30, 1997 (together with the First Amendment and the Original Credit
Agreement, the "Credit Agreement"); and
WHEREAS, the Borrower has requested that the Banks and the Agents amend the
Credit Agreement to (i) permit the investment in the Marketing LLC (defined
below) in the form of cash and promissory notes; (ii) permit certain Debt
related to the Marketing LLC; (iii) permit it to provide the limited Guarantee
of certain debt of the Marketing LLC; and (iv) permit it to provide certain
Trade Guarantees (defined below) of the Marketing LLC; and
WHEREAS, the Banks and the Agents are willing to amend the Credit Agreement
as hereinafter provided; and
WHEREAS, the Borrower, the Banks and the Agents now desire to amend the
Credit Agreement as herein set forth.
NOW, THEREFORE, in consideration of the premises herein contained and other
good and valuable considerations, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
ARTICLE II
Definitions
Section 2.2 Definitions. Capitalized terms used in this Amendment, to the
extent not otherwise defined herein, shall have the same meaning as in the
Credit Agreement, as amended hereby.
THIRD AMENDMENT TO CREDIT AGREEMENT - Page 1
ARTICLE IV
Amendments
Section 4.2 Additional Definitions. Section 1.1 is amended by adding the
following definitions in alphabetical order:
"Marketing Debt" means Debt of the Borrower in an amount not to exceed
$4,000,000, which Debt shall consist of the Borrower's guaranty of Marketing
LLC's credit facility. Marketing Debt shall be characterized as Debt of the
Borrower solely for purposes of calculating the Borrower's Debt to
Capitalization Ratio under Section 11.4 hereof.
"Marketing LLC" means the limited liability company being formed by the
Borrower or one of its Subsidiaries and NGTS that will assume all of NGTS's
natural gas marketing operations.
"Marketing Note" means, collectively, one or more promissory notes in the
amount of $2,000,000 issued by the Borrower and payable to NGTS, which
promissory notes shall be payable in cash or common stock of the Borrower, at
the sole option of Borrower. The amount of the Marketing Note shall not be
characterized as Debt, including for purposes of computing the Borrower's Debt
to Capitalization Ratio under Section 11.4 hereof, so long as the Marketing Note
is payable, at the sole option of the Borrower, in common stock of the Borrower.
"NGTS" means Natural Gas Transmission Services, Inc.
"Permitted Investment in Marketing LLC" means an investment by the Borrower
in Marketing LLC, in an amount not to exceed $4,500,000, which investment shall
consist of (a) approximately $2,500,000 in cash and (b) the Marketing Note.
"Trade Guarantees" means Contingent Liabilities in lieu of letters of
credit issued on behalf of the Marketing LLC and for which the Borrower or one
of its Subsidiaries are severally, or jointly and severally with one or more
other Persons, or both, liable, which Trade Guarantees shall not exceed an
aggregate of $15,000,000. Joint and several Trade Guarantees shall be subject to
written indemnification agreements, in form and substance and from Persons
satisfactory to the Agents, in their sole discretion, the effect of which shall
be to reduce the liability of the Borrower. Trade Guarantees will be treated as
Debt solely for the purpose of computing the Borrower's Debt to Capitalization
Ratio and solely for purposes of computing the Borrower's Debt to Capitalization
Ratio under Section 11.4 hereof, the amount of joint and several Trade
Guarantees that are characterized as Debt in calculating such ratio shall be
reduced by giving effect to the aforementioned written indemnification
agreements. Notwithstanding the foregoing, the Majority Banks shall at all times
reserve the right to include the entire amount of joint and several Trade
Guarantees, or any portion thereof, as Debt in computing the ratio, based on
such factors as the Majority Banks may from time to time deem material, in their
discretion; provided, however, that an Agent on behalf of the Majority Banks
must give the Borrower written notice at least 90 days prior to the end of a
fiscal quarter in order for any amount of joint and several Trade Guarantees in
excess of the Borrower's and its Subsidiaries' ratable share of such joint and
several Trade Guarantees to be included as Debt in computing the Borrower's Debt
to Capitalization Ratio for such fiscal quarter.
Section 4.4 Amendment to Section 10.1. Section 10.1 is amended by deleting
clause (d) in its entirety and substituting the following in lieu thereof: "(d)
the Senior Unsecured Debt, the Marketing Debt, the Trade Guarantees, and the
Marketing Note."
Section 4.6 Amendment to Section 10.3. Section 10.3 is amended by changing
the reference to "$1,500,000" to $1,500,000 plus the Permitted Investment in
Marketing LLC."
THIRD AMENDMENT TO CREDIT AGREEMENT - Page 2
Section 4.8 Amendment to Section 10.5. Section 10.5 is amended by deleting
the reference to "1,500,000" found in the fifth line thereof and inserting in
lieu thereof a reference to "1,500,000 plus the Permitted Investment in
Marketing LLC."
ARTICLE VI
Conditions Precedent
Section 6.2 Necessary Documentation. This Amendment shall be effective when
the Agent shall have received this Amendment executed by all parties.
Section 6.4 Borrower Covenant. The Borrower shall, within 30 days after the
date hereof, provide the Agents with:
(b) Copies of all organizational documents, operating agreements and
regulations of the Marketing LLC; and
(d) Any and all indemnification agreements relating to the Trade Guarantees
and such other information and documents relating to the indemnification
agreements as may be requested by the Agents, in their sole discretion.
Section 6.6 Representations and Warranties. All representations and
warranties contained in the Credit Agreement shall be true and correct on and as
of the date hereof with the same force and effect as if such representations and
warranties had been made on and as of such date.
Section 6.8 Additional Documentation. The Agents shall have such additional
approvals, opinions or documents as the Agents or their counsel, Xxxxxxxx
Xxxxxxxx & Xxxxxx P.C., may reasonably request.
ARTICLE VIII
Miscellaneous
Section 8.2 Ratifications, Representations and Warranties. Except as
expressly modified and superseded by this Amendment, the terms and provisions of
the Credit Agreement and the other Loan Documents are ratified and confirmed and
shall continue in full force and effect. The representations and warranties
contained herein and in all other Loan Documents, as amended hereby, shall be
true and correct as of, and as if made on, the date hereof. The Borrower, the
Banks and the Agents agree that the Credit Agreement as amended hereby shall
continue to be legal, valid, binding and enforceable in accordance with its
terms.
Section 8.4 Reference to the Credit Agreement. Each of the Loan Documents,
including the Credit Agreement and any and all other agreements, documents or
instruments now or hereafter executed and delivered pursuant to the terms hereof
or pursuant to the terms of the Credit Agreement as amended hereby, are hereby
amended so that any reference in such Loan Documents to the Credit Agreement
shall mean a reference to the Credit Agreement as amended hereby.
Section 8.6 Expenses. The Borrower agrees to pay on demand all expenses set
forth in Section 14.1 of the Credit Agreement.
Section 8.8 Severability. Any provisions of this Amendment held by court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provisions so held to be invalid or unenforceable.
THIRD AMENDMENT TO CREDIT AGREEMENT - Page 3
Section 8.10 Applicable Law. This Amendment and all other Loan Documents
executed pursuant hereto shall be governed by and construed in accordance with
the laws of the State of New York.
Section 8.12 Successors and Assigns. This Amendment is binding upon and
shall inure to the benefit of the Banks, the Agents and the Borrower and their
respective successors and assigns.
Section 8.14 Counterparts. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
but all of which when taken together shall constitute one and the same
instrument.
Section 8.16 Headings. The headings, captions, and arrangements used in
this Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
Section 8.18 NO ORAL AGREEMENTS. THIS AMENDMENT AND ALL OTHER INSTRUMENTS,
DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION HEREWITH REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES, AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
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THIRD AMENDMENT TO CREDIT AGREEMENT - Page 4
EXECUTED as of the day and year first above written.
BORROWER:
MAGNUM HUNTER RESOURCES, INC.
By:
Name:
Title:
ADMINISTRATIVE AGENT:
BANKERS TRUST COMPANY
By
Name:
Title:
DOCUMENTATION AGENT
AND COLLATERAL AGENT:
BANQUE PARIBAS
By:
Name:
Title:
- and -
By:
Xxxxxxx X. Xxxxxx
Vice President
ISSUING BANK:
BANKERS TRUST COMPANY
By
Name:
Title:
THIRD AMENDMENT TO CREDIT AGREEMENT - Page 5
BANKS:
BANQUE PARIBAS
By:
Name:
Title:
- and -
By:
Xxxxxxx X. Xxxxxx
Vice President
BANKERS TRUST COMPANY
By:
Name:
Title:
CIBC, INC.
By:
Name:
Title:
THIRD AMENDMENT TO CREDIT AGREEMENT - Page 6
ACKNOWLEDGEMENT BY GUARANTORS
Each of the undersigned Guarantors hereby (i) consents to the terms and
conditions of the Amendment, (ii) confirms and ratifies the terms of the Amended
and Restated Subsidiary Guaranty, (iii) acknowledges and agrees that its consent
is not required for the effectiveness of the Amendment and (iv) represents and
warrants that (a) no Default or Event of Default has occurred and is continuing,
(b) it is in full compliance with all covenants and agreements pertaining to it
in the Credit Documents and (c) it has reviewed a copy of the Amendment.
Executed as of December 15, 1997.
GUARANTORS:
HUNTER GAS GATHERING, INC.
GRUY PETROLEUM MANAGEMENT CO.
MAGNUM HUNTER PRODUCTION, INC.
CONMAG ENERGY CORPORATION
RAMPART PETROLEUM, INC.
By:
Name:
Title:
THIRD AMENDMENT TO CREDIT AGREEMENT - Page 7
