AMENDMENT TO CREDIT AGREEMENT
This AMENDMENT TO CREDIT AGREEMENT (the "Amendment"), dated effective as of
February 29, 2000, is made by and between XXXXXXXX PETROLEUM COMPANY, L.L.C., a
Louisiana limited liability company ("Borrower"), and COMPASS BANK, an Alabama
state chartered banking institution ("Lender").
RECITALS:
A. Borrower and Lender entered into that certain Credit Agreement dated as
of September 23, 1999 (as the same may have heretofore been amended, modified,
restated or supplemented from time to time, the "Credit Agreement").
B. Borrower and Lender now desire to make certain changes to the Credit
Agreement.
AGREEMENTS:
In consideration of the premises and the mutual agreements herein set
forth, the parties hereto hereby agree as follows:
1. DEFINITION OF "APPLICABLE MARGIN" AMENDED. The definition of
"Applicable Margin" set forth in Section 1.2 of the Credit Agreement is hereby
amended to read in its entirety as follows:
"Applicable Margin" shall mean five-eighths percent (5/8%).
2. DEFINITION OF "BORROWING BASE" AMENDED. The definition of "Borrowing
Base" set forth in Section 1.2 of the Credit Agreement is hereby amended to read
in its entirety as follows:
"Borrowing Base" shall mean (i) for February 29, 2000, $26,800,000,
(ii) the month of March, 2000, $26,500,000 and (ii) for each month
thereafter, an amount equal to the Borrowing Base for the immediately
preceding month minus $300,000.
3. DEFINITION OF "COMMITMENT TERMINATION DATE" AMENDED. The definition of
"Commitment Termination Date" set forth in Section 1.2 of the Credit Agreement
is hereby amended to read in its entirety as follows:
"Commitment Termination Date" shall mean July 1, 2001.
4. SECTION 5.22 AMENDED. Section 5.22 of the Credit Agreement is hereby
amended to read in its entirety as follows:
5.22. Asset Sales Proceeds. Upon the sale of any Property of the
Borrower or Xxxxxxxx, 100% of the net proceeds from such sale shall be
applied (subject, however, to the sharing requirements set forth in the
Collateral Agency Agreement to the same extent as if such proceeds were
realized from a foreclosure upon such Property), to permanently reduce the
Borrowing Base.
5. SECTION 6.1 AMENDED. Section 6.1 of the Credit Agreement is hereby
amended to read in its entirety as follows:
6.1. Indebtedness; Contingent Obligations. Create, incur, assume, or
suffer to exist any Indebtedness or Contingent Obligation, whether by way
of loan or otherwise; provided, however, the foregoing restriction shall
not apply to (a) the Obligations, the Subordinated Debt, the Pari Passu
Debt and the Lafitte Debt, (b) unsecured accounts payable incurred in the
ordinary course of business, which are not unpaid in excess of 60 days
beyond invoice date or are being contested in good faith and as to which
such reserve as is required by GAAP has been made (accounts payable on
extended terms shall not be allowed under this exception), (c) performance
guarantees and performance surety or other bonds provided in the ordinary
course of business, (d) Indebtedness with respect to Hedging Agreements
entered into by Lafitte and a third-party swap counterparty, (e)
Indebtedness with respect to Hedging Agreements (other than those Hedging
Agreements referred to in clause (d) above) entered into with a Person
acceptable to the Lender, provided that such Hedging Agreements relating to
hydrocarbons cover not more than 75% of the projected monthly production
from proved developed producing Oil and Gas Properties of the Borrower and
Lafitte, and provide for strike prices which, at the time any such Hedging
Agreement is entered into, are not less than the energy product pricing
guidelines of the Lender at such time, (f) performance guaranty of the
plugging and abandonment obligations owed by Lafitte to Stone Energy
Corporation with respect to Oil and Gas Properties in which Lafitte owns a
working interest, (g) trade credit (including authorizations for
expenditures with respect to Oil and Gas Properties) incurred or operating
leases entered into in the ordinary course of business, and (h)
Indebtedness owing by Lafitte to the Borrower to the extent permitted under
Section 6.5 hereof.
6. SECTION 6.5 AMENDED. Section 6.5 of the Credit Agreement is hereby
amended to read in its entirety as follows:
6.5. Loans; Advances; Investments. Make or agree to make or allow
to remain outstanding any loans or advances to or Investments in, or
purchase or otherwise acquire all or substantially all of the assets of any
Person, or form any new Subsidiaries; provided, however, the foregoing
restrictions shall not apply to (a) advances or extensions of credit in the
form of accounts receivable incurred in the ordinary course of business and
upon terms common in the industry for such accounts receivable, (b)
advances to employees for the payment of expenses in the ordinary course of
business, (c) loans, advances, or Investments by any Related Party other
than the Borrower or any Guarantor to any other Related Party, (d) loans,
advances, or Investments by Lafitte to either the Borrower or Xxxxxxxx, (e)
Investments in the form of (i) debt securities issued or directly and fully
guaranteed or insured by the United States Government or any agency or
instrumentality thereof, with
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maturities of no more than one year, (ii) commercial paper of a domestic
issuer rated at the date of acquisition at least P-2 by Xxxxx'x Investor
Service, Inc. or A-2 by Standard & Poor's Corporation and with maturities
of no more than one year from the date of acquisition, or (iii) repurchase
agreements covering debt securities or commercial paper of the type
permitted in this Section, certificates of deposit, demand deposits,
eurodollar time deposits, overnight bank deposits and bankers' acceptances,
with maturities of no more than one year from the date of acquisition,
issued by or acquired from or through the Lender or any bank or trust
company organized under the laws of the United States or any state thereof
and having capital surplus and undivided profits aggregating at least
$100,000,000, (f) other short-term Investments similar in nature and degree
of risk to those described in clause (e) of this Section, (g) the
Investments described on Exhibit I under the heading "Investments" or (h)
advances by the Borrower to Lafitte which do not exceed, in any fiscal
quarter, an amount approved in writing by the Lender (the approved maximum
amount for the fiscal quarter ending on March 31, 2000 shall be
$1,000,000).
7. CONDITIONS. No part of this Amendment shall become effective until
Borrower shall have delivered (or shall have caused to be delivered) to Lender
each of the following, in Proper Form:
(A) certificates dated as of the date hereof of the Secretary or any
Assistant Secretary of the Borrower authorizing the execution,
delivery and performance of this Amendment, and such other related
documents and information as Lender may request;
(B) all such Security Instruments as the Lender may require in order to
create and perfect a first priority Lien upon the Property acquired
under that certain Purchase and Sale Agreement (the "Burrwood
Contract") dated as of February 11, 2000 executed by and between
Energy Development Corporation and the Borrower, together with all
such letters in lieu of transfer orders relating to such Property as
the Lender may require;
(C) all such Security Instruments as the Lender may require in order to
create and perfect a first priority Lien upon the rights, titles and
interests of the Borrower in and to any funds held in Account Number
5149 maintained at Compass Bank in the name of Borrower, together with
an acknowledgment executed by the ascrow agent in respect of such
funds;
(D) evidence satisfactory to the Lender that (i) the transaction
contemplated by the Burrwood Contract (without amendment except as
approved in writing by the Lender) shall have been consummated and
(ii) Xxxxxxxx shall have received a net amount equal to or greater
than $4,200,000 from the issuance of its common stock substantially
concurrent with the execution and delivery of this Amendment;
(E) evidence satisfactory to the Lender that the Borrower shall have
deposited with the Lender at least $500,000 shall have been deposited
with the Lender in an account in the name of the Borrower (the parties
agreeing that withdrawals from such account shall require the written
consent of the Lender, which shall be granted so long as the
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Lender shall have received evidence satisfactory to the Lender that
the amounts to be withdrawn represent payment for or reimbursement of
amounts expended in satisfaction of the seismic requirements under the
Burrwood Contract);
(F) Lender's facility fee in the amount of $30,000; and
(G) evidence of the payment of any and all legal fees and expenses
incurred to date by Lender in connection with this Amendment
(including, without limitation, the negotiation and preparation of
this Amendment and the related Loan Documents).
8. CERTAIN DEFINITIONS AND REFERENCES. Terms used but not defined herein,
but which are defined in the Credit Agreement or in the other Loan Documents,
shall have the meanings herein ascribed to them therein. The term "Agreement"
as used in the Credit Agreement and the term "Credit Agreement," as used in the
other Loan Documents or any other instrument, document or writing furnished to
Lender by Borrower shall mean the Credit Agreement as hereby amended.
9. EXPENSES; INDEMNIFICATION. TO THE EXTENT NOT PROHIBITED BY APPLICABLE
LAW, BORROWER WILL PAY ALL REASONABLE COSTS AND EXPENSES AND REIMBURSE LENDER
FOR ANY AND ALL REASONABLE EXPENDITURES OF EVERY CHARACTER INCURRED OR EXPENDED
FROM TIME TO TIME, REGARDLESS OF WHETHER A DEFAULT HAS OCCURRED, IN CONNECTION
WITH THE PREPARATION, NEGOTIATION, DOCUMENTATION, RECORDING, CLOSING, RENEWAL,
REVISION, MODIFICATION, INCREASE, REVIEW OR RESTRUCTURING OF THIS AMENDMENT.
10. LIEN CONTINUATION; MISCELLANEOUS. Borrower and Lender hereby
acknowledge, confirm and agree that the Security Instruments secure and shall
continue to secure the obligations of Borrower and any other party to any of the
Loan Documents (other than Lender) under the Loan Documents and the Security
Instruments are hereby deemed modified to the extent necessary to evidence the
foregoing acknowledgments, agreements and confirmations. Nothing contained in
this Amendment or any other document, instrument or other writing executed in
connection with this Amendment shall be construed as a release or impairment of
any of the liens, assignments and security interests created or granted pursuant
to the Security Instruments and such liens, assignments and security interests
are hereby ratified and confirmed. The Liens of the Security Instruments are
not waived. To the extent of any conflict between the Credit Agreement or any
of the other Loan Documents (or any earlier modification of any of them) and
this Amendment, this Amendment shall control. Except as hereby expressly
modified, all terms of the Credit Agreement and the other Loan Documents (as any
of them may have been previously modified by any written agreement) remain in
full force and effect. This Amendment (a) shall bind and benefit Borrower and,
except as herein expressly limited, Lender, and their respective receivers,
trustees, successors and assigns (provided, that Borrower may not assign its
rights hereunder without the prior written consent of Lender); (b) may be
modified or amended only by a writing signed by each party; (c) SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE APPLICABLE LAWS OF THE STATE OF
TEXAS AND THE UNITED STATES OF AMERICA FROM TIME TO TIME IN EFFECT; (d) may be
executed in several counterparts, and by the parties hereto in separate
counterparts, and each counterpart, when executed and delivered, shall
constitute an original agreement enforceable against all who signed it without
production of or accounting for any other counterpart, and all separate
counterparts shall constitute the same agreement and (e) embodies the
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entire agreement and understanding between the parties with respect to
modifications of instruments provided for herein and supersedes all prior
conflicting or inconsistent agreements, consents and understandings relating to
such subject matter. Borrower acknowledges and agrees that there are no oral
agreements among any of them with respect to the transactions contemplated by
the Loan Documents which have not been incorporated in this Amendment or in the
Loan Documents. If any provision of this Amendment should be determined by any
court of competent jurisdiction to be illegal, invalid or unenforceable under
present or future laws, the legality, validity and enforceability of the
remaining provisions of this Amendment shall not be affected thereby. Each
waiver in this Amendment is subject to the overriding and controlling rule that
it shall be effective only if and to the extent that (a) it is not prohibited by
applicable law and (b) applicable law neither provides for nor allows any
material sanctions to be imposed against Lender for having bargained for and
obtained it. Wherever the term "including" or a similar term is used in this
Amendment, it shall be read as if it were "including by way of example only and
without in any way limiting the generality of the clause or concept referred
to." Any exhibits, appendices and annexes described in this Amendment as being
attached to it are hereby incorporated into it. The headings in this Amendment
shall be accorded no significance in interpreting it. BORROWER HEREBY RELEASES,
DISCHARGES AND ACQUITS FOREVER LENDER AND ITS OFFICERS, DIRECTORS, TRUSTEES,
AGENTS, EMPLOYEES AND COUNSEL (IN EACH CASE, PAST, PRESENT AND FUTURE) FROM ANY
AND ALL CLAIMS EXISTING AS OF THE DATE HEREOF (OR THE DATE OF ACTUAL EXECUTION
HEREOF BY THE APPLICABLE PERSON OR ENTITY, IF LATER). AS USED HEREIN, THE TERM
"CLAIM" SHALL MEAN ANY AND ALL LIABILITIES, CLAIMS, DEFENSES, DEMANDS, ACTIONS,
CAUSES OF ACTION, JUDGMENTS, DEFICIENCIES, INTEREST, LIENS, COSTS OR EXPENSES
(INCLUDING BUT NOT LIMITED TO COURT COSTS, PENALTIES, ATTORNEYS' FEES AND
DISBURSEMENTS, AND AMOUNTS PAID IN SETTLEMENT) OF ANY KIND AND CHARACTER
WHATSOEVER, INCLUDING BUT NOT LIMITED TO CLAIMS FOR USURY, BREACH OF CONTRACT,
BREACH OF COMMITMENT, NEGLIGENT MISREPRESENTATION OR FAILURE TO ACT IN GOOD
FAITH, IN EACH CASE WHETHER NOW KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED,
ASSERTED OR UNASSERTED OR PRIMARY OR CONTINGENT, AND WHETHER ARISING OUT OF
WRITTEN DOCUMENTS, UNWRITTEN UNDERTAKINGS, COURSE OF CONDUCT, TORT, VIOLATIONS
OF LAWS OR REGULATIONS OR OTHERWISE.
NOTICE PURSUANT TO TEX. BUS. & COMM. CODE (S)26.02
THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED BY ANY OF THE PARTIES
BEFORE OR SUBSTANTIALLY CONTEMPORANEOUSLY WITH THE EXECUTION HEREOF
TOGETHER CONSTITUTE A WRITTEN LOAN AGREEMENT WHICH REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
EXECUTED effective as of the date first set forth above.
XXXXXXXX PETROLEUM COMPANY, L.L.C.
By:_______________________________
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Xxxxxx X. Xxxxxxxx,
President
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COMPASS BANK
By:______________________________
Xxxxxxx Xxxxxxxx,
Senior Vice President
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The undersigned hereby join in this Amendment to evidence their consent to
execution by Borrower of this Amendment, to confirm that each Loan Document now
or previously executed by the undersigned applies and shall continue to apply to
the Credit Agreement, as amended hereby, to acknowledge that without such
consent and confirmation, Lender would not execute this Amendment and to join in
the notice pursuant to Tex. Bus. & Comm. Code (s)26.02 set forth above.
XXXXXXXXX & XXXXX GUARANTY FINANCE, LLC, , as
Agent for the Lafitte Noteholders, the Pari Passu
Noteholders and the Subordinated Noteholders (as
such terms are defined in that certain Collateral
Agency Agreement dated as of September 23, 1999
executed by and among Compass Bank and Xxxxxxxxx &
Xxxxx Guaranty Finance, LLC)
By:_______________________________
Name:_____________________________
Title:____________________________
XXXXXXXX PETROLEUM CORPORATION,
a Delaware corporation
By:_______________________________
Xxxxxx X. Xxxxxxxx
President
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