THIRD AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT Dated March 16, 2018 Among RESOLUTE ENERGY CORPORATION, as Borrower, CERTAIN OF ITS SUBSIDIARIES, as Guarantors, BANK OF MONTREAL, as Administrative Agent, CAPITAL ONE, NATIONAL...
Exhibit 10.1
Execution Version
THIRD AMENDMENT TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
Dated March 16, 2018
Among
RESOLUTE ENERGY CORPORATION,
as Borrower,
CERTAIN OF ITS SUBSIDIARIES,
as Guarantors,
BANK OF MONTREAL,
as Administrative Agent,
CAPITAL ONE, NATIONAL ASSOCIATION,
as Syndication Agent,
BARCLAYS BANK PLC,
ING CAPITAL LLC,
and
SUNTRUST BANK,
as Co-Documentation Agents,
and
The Lenders Party Hereto
BMO CAPITAL MARKETS and CAPITAL ONE, NATIONAL ASSOCIATION,
as Joint Bookrunners and Co-Lead Arrangers
THIS THIRD AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this “Third Amendment”), dated as of March 16, 2018, is by and among Resolute Energy Corporation, a Delaware corporation (the “Borrower”), certain of its subsidiaries (collectively, the “Guarantors”), Bank of Montreal, as Administrative Agent (the “Administrative Agent”), and the lenders party hereto (the “Lenders”).
Recitals
WHEREAS, the Borrower, the Guarantors, the Administrative Agent and the other lenders party thereto entered into that certain Third Amended and Restated Credit Agreement, dated as of February 17, 2017, as amended by that certain First Amendment to Third Amended and Restated Credit Agreement, dated as of May 8, 2017 and that certain Second Amendment to Third Amended and Restated Credit Agreement, dated as of October 18, 2017 (as amended, modified, supplemented or restated from time to time, the “Credit Agreement”);
WHEREAS, the Borrower has requested that the Administrative Agent and the Lenders amend the Credit Agreement as set forth herein; and
WHEREAS, subject to the satisfaction of the conditions set forth herein, the Administrative Agent and the Lenders are willing to amend the Credit Agreement as provided herein.
NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and in the Credit Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
ARTICLE I
Definitions
Each capitalized term used in this Third Amendment and not defined herein shall have the meaning assigned to such term in the Credit Agreement. Unless otherwise indicated, all section references in this Third Amendment refer to sections of the Credit Agreement.
ARTICLE II
Amendments to Credit Agreement
As of the Third Amendment Effective Date (as defined below), the Credit Agreement is amended as follows:
Section 2.01Amendments to Section 1.02.
(a)Section 1.02 of the Credit Agreement is hereby amended by amending the definition of “Applicable Margin” to add the following immediately after the grid set forth therein:
“Notwithstanding the foregoing, if the ratio of total Funded Debt to EBITDA of the Borrower and its Consolidated Restricted Subsidiaries calculated in accordance with Section 9.01(b) for the period ending on June 30, 2018 exceeds 4.00:1.00, then each
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applicable rate per annum set forth in the grid above shall be deemed to be increased by 0.25% per annum for the period from and after such date of determination until the date such ratio is calculated in accordance with Section 9.01(b) for the four (4) quarter period ending on September 30, 2018 in connection with the delivery of financial statements pursuant to Section 8.01(b) for such fiscal quarter.”
(b)Section 1.02 of the Credit Agreement is hereby further amended, which amendment shall be deemed effective as of March 31, 2018, by amending and restating the following definition in its entirety:
““EBITDA” means, for any period, the sum of (a) Consolidated Net Income for such period, plus (b) the following expenses or charges to the extent deducted from Consolidated Net Income in such period: (i) interest, (ii) income and franchise taxes, (iii) depreciation, depletion, amortization, and other non-cash charges (iv) customary costs and expenses incurred in connection with or related to (A) any acquisition involving consideration paid by the Borrower and/or its Consolidated Restricted Subsidiaries or (B) any disposition yielding gross proceeds to the Borrower and/or its Consolidated Restricted Subsidiaries, in each case, in excess of $15,000,000 for such acquisition or disposition (including, without limitation, legal, accounting and financial advisory fees, title and environmental due diligence costs, employee retention, severance, or relocation expenses, costs and expenses related to the acceleration of long-term employee incentive awards, and contract termination costs), and (v) costs and expenses not to exceed $7,500,000 in the aggregate in calendar year 2018 incurred in connection with or related to any action taken by the Borrower in response to targeted activist investor campaigns, minus (c) all non-cash income added to Consolidated Net Income for such period; provided that (x) for the period ending on December 31, 2017, EBITDA shall equal EBITDA for the fiscal quarter ending on December 31, 2017, multiplied by 4, (y) for the period ending on March 31, 2018, EBITDA shall equal EBITDA for the period beginning on October 1, 2017 and ending on March 31, 2018, multiplied by 2, and (z) for the period ending on June 30, 2018, EBITDA shall equal EBITDA for the period beginning on October 1, 2017 and ending on June 30, 2018, multiplied by 4/3.”
(c)Section 1.02 of the Credit Agreement is hereby further amended by amending the definition of “Maturity Date” to replace the reference to “Existing Senior Notes” where it appears therein with a reference to “Senior Notes”.
(d)Section 1.02 of the Credit Agreement is hereby further amended by amending and restating the following definition in its entirety:
““Permitted Senior Debt” means Senior Notes or any other unsecured Debt incurred pursuant to Section 9.02(f).”
(e)Section 1.02 of the Credit Agreement is hereby further amended by adding thereto each of the following definitions in alphabetical order:
““Senior Notes” means (a) the Existing Senior Notes and (b) any other senior notes issued by the Borrower pursuant to that certain Indenture, dated April 25, 2012, among the
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Borrower, the guarantors party thereto and U.S. Bank National Association, as trustee (as amended, restated, supplemented or otherwise modified prior to the Third Amendment Effective Date, and as may be further supplemented in connection with such issuance) and due on the Senior Notes Maturity Date, provided that the incurrence of Debt in respect of such issuance is, at the time of such issuance, permitted under clauses (A) and (C) of the proviso in Section 9.02(f).”
““Third Amendment Effective Date” has the meaning given such term in that certain Third Amendment to Amended and Restated Credit Agreement dated as of March 16, 2018 among the Borrower, the Guarantors party thereto, the Administrative Agent, and the other Agents and Lenders party thereto.”
Section 2.02Amendment to Section 8.01(o). Section 8.01(o) of the Credit Agreement is hereby amended by replacing the reference to “Existing Senior Notes” where it appears therein with a reference to “Senior Notes”.
Section 2.03Amendment to Section 9.01(b). Section 9.01(b) of the Credit Agreement is hereby amended and restated in its entirety as follows:
“(b)Maximum Leverage Ratio. The Loan Parties will not, as of the last day of any fiscal quarter for which financial statements are required to have been provided pursuant to Section 8.01(a) or (b), permit the ratio of (i) the total Funded Debt as of such date to (ii) EBITDA of the Borrower and its Consolidated Restricted Subsidiaries for the four (4) quarter period ending on such date to be greater than the applicable ratio set forth below:
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Quarter Ending |
Maximum Leverage Ratio |
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December 31, 2017 |
4.00:1.00 |
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March 31, 2018 |
4.00:1.00 |
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June 30, 2018 |
4.25:1.00 |
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September 30, 2018 and thereafter |
4.00:1.00 |
Section 2.04Amendment to Section 9.02(f). Section 9.02(f) of the Credit Agreement is hereby amended by (a) replacing “Existing Senior Notes” where it appears therein with “Senior Notes” and (b) replacing “$550,000,000” where it appears therein with “$600,000,000”.
ARTICLE III
Conditions Precedent
Section 3.01The amendments set forth in Article II of this Third Amendment shall become effective on the first Business Day on which all of the following conditions precedent shall have been satisfied (or waived in accordance with Section 12.02 of the Credit Agreement) (the “Third Amendment Effective Date”):
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(a)The Administrative Agent shall have received from the Borrower, each of the Guarantors and the Required Lenders counterparts (in such number as may be requested by the Administrative Agent) of this Third Amendment signed on behalf of such Persons.
(b)The Administrative Agent shall have received from the Borrower in immediately available funds (i) all fees and amounts due and payable on or prior to the Third Amendment Effective Date (including, without limitation, an amendment fee for each Lender party to the Third Amendment that delivered its executed Third Amendment signature page to the Administrative Agent on or before 11:00 a.m. Houston, Texas time on March 16, 2018, subject to no escrow instructions other than satisfaction of closing conditions under this Article III, in an amount equal to 0.15% of such Lender’s Commitment as of such date) and (ii) to the extent invoiced, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower hereunder.
ARTICLE IV
Representations and Warranties
Each Loan Party hereby represents and warrants to each Lender that:
(a)Each of the representations and warranties made by it under the Credit Agreement and each other Loan Document is, or will be, true and correct on and as of the actual date of its execution of this Third Amendment, as if made on and as of such date, except for any representations and warranties made as of a specified date, which are true and correct as of such specified date.
(b)Immediately after giving effect to this Third Amendment, no Default has, or will have, occurred and is, or will be, continuing.
(c)The execution, delivery and performance by it of this Third Amendment and any other Loan Documents executed in connection herewith have been duly authorized by it.
(d)Each of this Third Amendment and any other Loan Document executed in connection herewith constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
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Subsidiary or any order of any Governmental Authority, (iii) will not violate or result in a default under any indenture, agreement or other instrument binding upon it or any Restricted Subsidiary or its Properties, or give rise to a right thereunder to require any payment to be made by it or such Restricted Subsidiary and (iv) will not result in the creation or imposition of any Lien on any Property of any Loan Party or any Restricted Subsidiary (other than the Liens created by this Third Amendment or the Loan Documents as permitted by the Credit Agreement as amended hereby). |
ARTICLE V
Miscellaneous
Section 5.01Credit Agreement in Full Force and Effect as Amended. Except as specifically amended hereby, the Credit Agreement and other Loan Documents shall remain in full force and effect. Each of the Loan Parties hereby agrees that its liabilities under the Credit Agreement and the other Loan Documents, in each case as amended, to which it is a party, shall remain enforceable against such Loan Party in accordance with the terms thereof and shall not be reduced, altered, limited, lessened or in any way affected by the execution and delivery of this Third Amendment, and each Loan Party hereby confirms and ratifies its liabilities under the Loan Documents (as so amended) to which it is a party in all respects. Except as expressly set forth herein, this Third Amendment shall not be deemed to be a waiver, amendment or modification of any provisions of the Credit Agreement or any other Loan Document or any right, power or remedy of the Administrative Agent or Lenders, or constitute a waiver of any provision of the Credit Agreement or any other Loan Document, or any other document, instrument and/or agreement executed or delivered in connection therewith or of any Default or Event of Default under any of the foregoing, in each case whether arising before or after the date hereof or as a result of performance hereunder or thereunder. This Third Amendment also shall not preclude the future exercise of any right, remedy, power, or privilege available to the Administrative Agent and/or Lenders whether under the Credit Agreement, the other Loan Documents, at law or otherwise. The parties hereto agree to be bound by the terms and conditions of the Credit Agreement and the other Loan Documents as amended by this Third Amendment, as though such terms and conditions were set forth herein. Each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words of similar import shall mean and be a reference to the Credit Agreement as amended by this Third Amendment, and each reference herein or in any other Loan Documents to the “Credit Agreement” shall mean and be a reference to the Credit Agreement as amended and modified by this Third Amendment.
Section 5.02GOVERNING LAW. THIS THIRD AMENDMENT, AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER, SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
Section 5.03Descriptive Headings, Etc. The descriptive headings of the sections of this Third Amendment are inserted for convenience only and shall not be deemed to affect the meaning or construction of any of the provisions hereof. The statements made and the terms defined in the recitals to this Third Amendment are hereby incorporated into this Third Amendment in their entirety.
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Section 5.04Payment of Fees and Expenses. In addition to paying to the Administrative Agent for the account of the Lenders the fees described in Section 3.01(b)(i) above, the Borrower agrees to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with this Third Amendment, the other Loan Documents and any other documents prepared in connection herewith and the transactions contemplated hereby, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent. The agreement set forth in this Section 5.04 shall survive the termination of this Third Amendment and the Credit Agreement.
Section 5.05Entire Agreement. This Third Amendment and the documents referred to herein represent the entire understanding of the parties hereto regarding the subject matter hereof and supersede all prior and contemporaneous oral and written agreements of the parties hereto with respect to the subject matter hereof. This Third Amendment is a Loan Document executed under the Credit Agreement.
Section 5.06Counterparts. This Third Amendment may be executed in any number of counterparts and by different parties on separate counterparts, each of which shall constitute an original but all of which when taken together shall constitute but one agreement. Delivery of an executed counterpart of the signature page of this Third Amendment by facsimile or other electronic transmission shall be effective as delivery of a manually executed counterpart thereof.
Section 5.07Successors. The execution and delivery of this Third Amendment by any Lender shall be binding upon each of its successors and assigns.
[Signatures Begin on Next Page]
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IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to be duly executed by their respective authorized officers as of the date first written above.
BORROWER:
RESOLUTE ENERGY CORPORATION
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By: |
/s/ Xxxxxxxx Xxxxxxx |
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Xxxxxxxx Xxxxxxx |
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Executive Vice President and |
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Chief Financial Officer |
GUARANTORS:XXXXX ACQUISITION COMPANY I, INC.
RESOLUTE WYOMING, INC. (f/k/a Primary Natural Resources, Inc.)
RESOLUTE NATURAL RESOURCES COMPANY, LLC (f/k/a Resolute Natural Resources Company)
BWNR, LLC
WYNR, LLC
RESOLUTE NORTHERN ROCKIES, LLC
RESOLUTE NATURAL RESOURCES
SOUTHWEST, LLC
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By: |
/s/ Xxxxxxxx Xxxxxxx |
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Xxxxxxxx Xxxxxxx |
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Executive Vice President and |
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Chief Financial Officer |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
ADMINISTRATIVE AGENT
AND LENDER:BANK OF MONTREAL,
as Administrative Agent and a Lender
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By: |
/s/ Xxxxx X. Xxxxxx |
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Name: Xxxxx X. Xxxxxx |
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Title: Managing Director |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
LENDER:KEYBANK, NATIONAL ASSOCIATION
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By: |
/s/ Xxxxx X. Xxxxxxxxx |
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Name: Xxxxx X. Xxxxxxxxx |
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Title: Senior Vice President |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
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By: |
/s/ Xxxxxxx Xxxxxx |
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Name: Xxxxxxx Xxxxxx |
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Title: SVP, Relationship Manager |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
LENDER:SUNTRUST BANK, as a Lender
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By: |
/s/ Arize Agumadu |
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Name: Arize Agumadu |
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Title: Vice President |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
LENDER:CAPITAL ONE, NATIONAL ASSOCIATION
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By: |
/s/ Xxxxxxxxxxx Xxxx |
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Name: Xxxxxxxxxxx Xxxx |
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Title: Director |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
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By: |
/s/ Sydney X. Xxxxxx |
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Name: Sydney X. Xxxxxx |
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Title: Director |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
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By: |
/s/ Xxxx Xxxxxx |
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Name: Xxxx Xxxxxx |
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Title: Managing Director |
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By: |
/s/ Xxxxx Xxxxxxxxx |
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Name: Xxxxx Xxxxxxxxx |
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Title: Director |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
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By: |
/s/ Xxxxxxxxx X. Xxxxx |
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Name: Xxxxxxxxx X. Xxxxx |
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Title: Portfolio Manager |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
LENDER:FIFTH THIRD BANK
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By: |
/s/ Xxxxxxxx X. Xxx |
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Name: Xxxxxxxx X. Xxx |
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Title: Director |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
LENDER:ABN AMRO CAPITAL USA LLC
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By: |
/s/ Xxxxxxx Xxxxxx |
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Name: Xxxxxxx Xxxxxx |
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Title: Managing Director |
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By: |
/s/ Xxxxx Xxxxxxxxxx |
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Name: Xxxxx Xxxxxxxxxx |
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Title: Managing Director |
Signature Page to
Third Amendment to Third Amended and Restated Credit Agreement
