EXHIBIT 10.16
SECOND AMENDMENT
TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
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This Second Amendment to Third Amended and Restated Credit Agreement (this
"Amendment") is entered into and effective as of the 13th day of October, 1999,
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by and among BANK OF AMERICA, N.A. (formerly known as Bank of America National
Trust and Savings Association) in its individual capacity as the sole Lender
("Lender") and as Agent for the Lenders ("Agent"), and LATEX PETROLEUM
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CORPORATION, LATEX/GOC ACQUISITION, INC., GERMANY OIL COMPANY, ALLIANCE
RESOURCES (USA), INC., SOURCE PETROLEUM, INC. and ALLIANCE RESOURCES PLC
(individually, a "Borrower," and collectively, "Borrowers").
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W I T N E S S E T H:
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WHEREAS, Lender, Agent and Borrowers are parties to that certain Third
Amended and Restated Credit Agreement dated as of October 26, 1998 pursuant to
which Lender has made certain loans and provided certain other credit
accommodations to Borrowers (as amended, the "Credit Agreement") (unless
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otherwise defined herein, all defined terms used herein which are defined in the
Credit Agreement shall have the meanings assigned to such terms in the Credit
Agreement); and
WHEREAS, Alliance Plc, American Rivers Oil Company, a Wyoming Corporation
and American Rivers Oil Company, a Delaware corporation ("AROC Delaware") have
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entered into that certain Exchange and Merger Agreement (herein so called) dated
as of July 22, 1999, pursuant to which, among other things, AROC Delaware will
offer (herein referred to as the "Offer") to exchange (a) one share of common
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stock, par value $0.01 per share of AROC Delaware for each ordinary share of
(Pounds)0.01 each in the capital of Alliance Plc, and (b) one convertible
restricted voting share of AROC Delaware for each convertible restricted voting
share of (Pounds).0.01 each in the capital of Alliance Plc (the "Proposed
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Exchange"); and
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WHEREAS, Borrowers have requested that (a) Lender (i) consent to the
consummation of the Proposed Exchange pursuant to the terms of the Exchange and
Merger Agreement as in effect on the date hereof, and (ii) waive the Event of
Default under Section 9.1.8. of the Credit Agreement to the extent the
consummation of the Proposed Exchange results in an Event of Default under the
Credit Agreement, and (b) the Credit Agreement be amended to change the
definition of "Change in Control" contained therein in connection with the
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consummation of the Proposed Exchange; and
WHEREAS, subject to and upon the terms and conditions set forth herein,
Lender and Agent are willing to enter into the amendment and grant the waiver
Borrowers have requested.
NOW, THEREFORE, in consideration of the agreements herein contained, the
parties hereto hereby agree as follows:
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SECTION 1. Consent and Waiver. Subject to and upon the terms and
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conditions set forth herein, and in reliance on the representations and
warranties set forth herein, Lender (a) consents to the consummation of the
Proposed Exchange pursuant to the terms of the Exchange and Merger Agreement as
in effect on the date hereof, and (b) waives the Event of Default under Section
9.1.8. of the Credit Agreement to the extent, but only to the extent, that the
consummation of the Proposed Exchange results in an Event of Default under the
Credit Agreement. The consent and waiver herein contained are limited solely to
the Proposed Exchange, and nothing contained herein shall be deemed a consent to
any other action or inaction of any Borrower which constitutes a violation of
any provision of the Credit Agreement or any other Loan Document or which
results in a Default or Event of Default under the Credit Agreement or any other
Loan Document. No Lender shall be obligated to grant any future waivers or
amendments of the Credit Agreement or any other Loan Document.
SECTION 2. Amendments. Subject to and upon the terms and conditions
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set forth herein, the Credit Agreement is hereby amended as follows:
2.1 Additional Definitions. Section 1.1 of the Agreement is hereby
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amended to add thereto definitions of "AROC Inc." and "Second Amendment," which
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shall read in full as follows:
"AROC Inc." means AROC Inc., a Delaware corporation, and the successor by
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name change to American Rivers Oil Company, a Delaware corporation.
"Second Amendment" means that certain Second Amendment to Third Amended and
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Restated Credit Agreement dated as of October 13, 1999 by and among Borrowers,
Lenders and Agent.
2.2 Amendment to Existing Defined Term. The definition of "Agreement"
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contained in Section 1.1 of the Credit Agreement is hereby amended to read in
full as follows:
"Agreement" means, on any date, this Third Amended and Restated Credit
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Agreement as amended by the First Amendment and the Second Amendment, and as
subsequently amended, supplemented, amended and restated, or otherwise modified
and in effect on such date.
2.3 Amendment to Change in Control Definition. Immediately upon the
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declaration by AROC Delaware that the Offer is wholly "unconditional" in all
respects, the definition of "Change in Control" contained in Section 1.1 of the
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Credit Agreement shall be automatically amended (without the necessity of any
further action by any party hereto) to read in full as follows:
"Change in Control" means if (a) any Person or "group" (as defined in the
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Securities Exchange Act of 1934) other than (i) Xxxx X. Xxxxxx, (ii) Difco
Holders, (iii) any trust existing solely for the benefit of the above
individuals or the estate or any executor, administrator, conservator, or other
legal representative of any of the above individuals, or (iv) EnCap shall own,
directly or indirectly, greater than 33 1/3% of the issued and outstanding
voting share capital of AROC Inc., (b) Alliance Plc shall cease to be a
Subsidiary of AROC Inc., (c) AROC Inc. shall sell, assign, transfer, convey or
otherwise dispose of
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any of the issued and outstanding voting share capital of Alliance Plc, (d)
Alliance Plc shall fail beneficially to own 100% of the outstanding shares of
the voting capital stock of Manx or Difco, on a fully-diluted basis, (e) Difco
shall fail beneficially to own 100% of the outstanding shares of the voting
capital stock of Alliance Delaware, on a fully-diluted basis, (f) Alliance
Delaware shall fail beneficially to own 100% of the outstanding shares of the
voting capital stock of LRI or Alliance Group, on a fully-diluted basis, (g) LRI
shall fail beneficially to own 100% of the outstanding shares of the voting
capital stock of LPC, GOCA, New GOC or ENPRO, on a fully-diluted basis, (h)
Alliance Group shall fail beneficially to own 100% of the outstanding shares of
the voting capital stock of Source, ARNO, ARCOL or Alliance USA, on a fully-
diluted basis, or (i) during the period from the date of one annual general
meeting of Alliance Plc to the next annual meeting, beginning with the 1998
annual general meeting, individuals who at the beginning of such period were
members of the Board of Directors of Alliance Plc shall cease for any reason to
constitute a majority of the members of the Board of Directors of Alliance Plc.
SECTION 3. Certain Acknowledgment of Guarantors. By executing the
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acknowledgment to this Amendment, each Guarantor hereby confirms and agrees that
the Guaranty and each Security Document to which it is a party is, and shall
continue to be, in full force and effect and is hereby ratified and confirmed in
all respects, except that, on and after the date hereof, each reference therein
to the "Credit Agreement," "thereunder," "thereof" or words of like import
referring to the Credit Agreement, shall mean and refer to the Credit Agreement
after giving effect to the First Amendment and this Amendment.
SECTION 4. Representations and Warranties. In order to induce Lender
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to grant the consent and waiver contained in Section 1, and to induce Agent and
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Lender to enter into the amendments to the Credit Agreement contained in Section
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2, Borrowers hereby represent and warrant to Lender and Agent as follows:
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4.1 Reaffirmation of Representations and Warranties. After giving effect
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to the consent and waiver contained in Section 1 hereof and the amendments
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contained in Section 2 hereof, each representation and warranty of Borrowers
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contained in the Credit Agreement and the other Loan Documents is true and
correct.
4.2 Due Authorization, No Conflicts. The execution, delivery and
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performance by each Borrower of this Amendment are within each Borrower's
corporate powers, have been duly authorized by all necessary corporate action,
require no action by or in respect of, or filing with, any governmental body,
agency or official and do not violate or constitute a default under any
provision or application of law or any material agreement binding upon any
Borrower or any of its Subsidiaries or result in the creation or imposition of
any Lien upon any of its respective assets.
4.3 Validity and Binding Effect. This Amendment constitutes the valid and
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binding obligations of each Borrower enforceable in accordance with its terms,
except as (a) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditor's rights generally, and (b) the
availability of equitable remedies may be limited by equitable principles of
general application.
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4.4 No Defenses. Neither any Borrower nor any other Obligor has any
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defense to payment, counterclaim or right of set-off with respect to the
Obligations existing on the date hereof.
SECTION 5. Conditions to Effectiveness.
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5.1 Effective Date. This consent and waiver contained in Section 1 hereof
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and the amendments contained in Section 2 hereof shall be effective on October
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13, 1999, when each of the conditions set forth in this Section 5 have been
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satisfied.
5.2 Execution of Counterparts. The Agent shall have received counterparts
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of this Amendment duly executed and delivered on behalf of each Obligor, the
Agent and the Lenders.
5.3 Closing Fees, Expenses, etc. The Agent shall have received all
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reasonable fees and expenses of counsel to Agent incurred by Agent in connection
with the preparation, negotiation, execution and closing of this Amendment.
5.4 Legal Details, etc. All documents executed or submitted pursuant
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hereto, and all legal matters incident thereto, shall be satisfactory in form
and substance to the Agent and its counsel.
5.5 Warrant Agreements; Registration Rights Agreement. The Agent shall
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have received executed counterparts of (a) Warrant Agreements, dated as of the
date hereof, in the form of Exhibits A-1 and A-2 attached hereto, and executed
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by AROC Delaware, and (b) a Registration Rights Agreement, dated as of the date
hereof, in the form of Exhibit B attached hereto, and executed by AROC Delaware
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and LaSalle Street Natural Resources Corporation.
SECTION 6. Miscellaneous.
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6.1 Reaffirmation of Loan Documents; Extension of Liens. Any and all of
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the terms and provisions of the Credit Agreement and the Loan Documents shall,
except as amended and modified hereby, remain in full force and effect. Each
Borrower hereby ratifies, confirms and extends the Liens securing the
Obligations until the Obligations have been paid in full or are specifically
released by Agent prior thereto, and agrees that the amendments and
modifications herein contained shall in no manner adversely affect or impair the
Obligations or the Liens securing payment and performance thereof.
6.2 Parties in Interest. All of the terms and provisions of this
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Amendment shall bind and inure to the benefit of the parties hereto and their
respective successors and assigns.
6.3 Legal Expenses. Borrowers hereby agree to pay on the date hereof all
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reasonable fees and expenses of counsel to Agent incurred by Agent in connection
with the preparation, negotiation and execution of this Amendment and all
related documents.
6.4 Counterparts. This Amendment may be executed in counterparts, and all
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parties need not execute the same counterpart. Facsimiles shall be effective as
originals.
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6.5 Complete Agreement. THIS AMENDMENT, THE CREDIT AGREEMENT (AS AMENDED
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PURSUANT TO THE FIRST AMENDMENT AND THIS AMENDMENT) AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG 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 AMONG THE PARTIES.
6.6 Headings. The headings, captions and arrangements used in this
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Amendment are, unless specified otherwise, for convenience only and shall not be
deemed to limit, amplify or modify the terms of this Amendment, nor affect the
meaning thereof.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have cause this Amendment to be
executed by their respective officers hereunto duly authorized as of the day and
first year above written.
BORROWERS:
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LATEX PETROLEUM CORPORATION
By:____________________________________________
Title:_________________________________________
LATEX/GOC ACQUISITION, INC.
By:____________________________________________
Title:_________________________________________
GERMANY OIL COMPANY
By:____________________________________________
Title:_________________________________________
ALLIANCE RESOURCES (USA), INC.
By:____________________________________________
Title:_________________________________________
SOURCE PETROLEUM, INC.
By:____________________________________________
Title:_________________________________________
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ALLIANCE RESOURCES PLC
By:_____________________________________________
Title:__________________________________________
AGENT:
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BANK OF AMERICA, N.A., FORMERLY BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent
for the Lenders
By:_____________________________________________
Title:____________________________________
LENDER:
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BANK OF AMERICA, N.A., FORMERLY KNOWN AS BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION
By:_____________________________________________
Title:____________________________________
Acknowledged and Accepted:
LATEX RESOURCES, INC.
By:_____________________________
Name:_____________________
Title:____________________
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ENPRO, INC.
By:_____________________________
Name:_____________________
Title:____________________
ALLIANCE RESOURCES (DELAWARE), INC.
By:_____________________________
Name:_____________________
Title:____________________
ALLIANCE RESOURCES GROUP, INC.
By:_____________________________
Name:_____________________
Title:____________________
DIFCO LIMITED
By:_____________________________
Name:_____________________
Title:____________________
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EXHIBIT A-1
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Warrant Agreement
relating to the issuance of Series D, E, F, G and H Warrants
of American Rivers Oil Company
(to be attached)
EXHIBIT A-2
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Warrant Agreement
relating to the issuance of Series I Warrants
of American Rivers Oil Company
(to be attached).
EXHIBIT B
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Registration Rights Agreement
(to be attached).
