FIFTH AMENDMENT TO THIRD RESTATED LOAN AGREEMENT (TERM)
THIS FIFTH AMENDMENT TO THIRD RESTATED LOAN AGREEMENT (TERM) (herein
called the "Amendment") made as of the 19th day of July 1995, by and among
Western Gas Resources, Inc., a Delaware corporation ("Borrower"), NationsBank of
Texas, N.A., a national banking association, as Agent ("Agent"), and NationsBank
of Texas, N.A., Bankers Trust Company, Bank of Montreal and CIBC Inc. (herein,
collectively referred to as "Lenders"),
W I T N E S S E T H:
WHEREAS, Borrower, Agent and Lenders have entered into that certain
Third Restated Loan Agreement (Term) dated as of August 31, 1993, as amended by
that certain First Amendment to Third Restated Loan Agreement (Term) dated as of
December 31, 1993, that certain Second Amendment to Third Restated Loan
Agreement (Term) dated as of September 2, 1994, that certain Third Amendment to
Third Restated Loan Agreement (Term) dated as of December 2, 1994, and that
certain Fourth Amendment to Third Restated Loan Agreement (Term) dated as of
February 23, 1995, among Borrower, Agent and Lenders (as amended to the date
hereof, the "Original Agreement") for the purpose and consideration therein
expressed, whereby Lenders made loans to Borrower as therein provided; and
WHEREAS, Borrower, Agent and Lenders desire to amend the Original
Agreement as expressly set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein and in the Original Agreement and in
consideration of the loans which may hereafter be made by Lenders to Borrower,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto do hereby agree as follows:
ARTICLE I.
Definitions and References
--------------------------
Section 1.1. Terms Defined in the Original Agreement. Unless the
---------------------------------------
context otherwise requires or unless otherwise expressly defined herein, the
terms defined in the Original Agreement shall have the same meanings whenever
used in this Amendment.
Section 1.2. Other Defined Terms. Unless the context otherwise
-------------------
requires, the following terms when used in this Amendment shall have the
meanings assigned to them in this Section 1.2.
- 1 -
"Loan Agreement" shall mean the Original Agreement as amended hereby.
ARTICLE II.
Amendments
----------
Section 2.1. Definitions. The definition of "Debt Securities"
-----------
contained in Section 1.1 of the Original Agreement is hereby amended in its
entirety to read as follows:
"'Debt Securities' means collectively, (i) those senior notes dated
---------------
October 27, 1992, September 22, 1993, December 27, 1993 and October 27, 1994
issued by Borrower pursuant to that certain Master Shelf Agreement dated as of
December 19, 1991 between Borrower and the Prudential Insurance Company of
America (as amended and restated from time to time, the "Shelf Agreement") and
any additional notes issued pursuant to the Shelf Agreement (ii) the 7.65%
senior notes due April 30, 2003 in the aggregate principal amount of $50,000,000
issued by Borrower pursuant to various note purchase agreements among Borrower,
MIGC, MGTC, WGRS, WGRT and each member of the CIGNA Group, as amended and
restated from time to time and (iii) all other notes issued pursuant to note
purchase agreements among any Related Person and any member of the CIGNA Group,
Prudential Insurance Company of America, or any other institutional investor."
Section 2.2. Tangible Net Worth.
------------------
The definition of "Tangible Net Worth Minimum" contained in the last
sentence of Section 5.2(j) of the Original Agreement is hereby amended in its
entirety to read as follows:
"As used in this subsection the term 'Tangible Net Worth Minimum'
means the sum of (i) $345,000,000; plus (ii) fifty percent (50.0%) of
-----
Borrower's Consolidated cumulative net income earned after June 30,
1995, if such figure is positive (zero percent, if negative); plus
----
(iii) seventy-five percent (75.0%) of the cumulative net proceeds
received by Borrower at any time after June 30, 1995 from the sale of
any equity securities issued by Borrower or any of its Subsidiaries."
Section 2.3. Debt to Capitalization Ratio.
----------------------------
Section 5.2(m) of the Original Agreement is hereby amended in its
entirety to read as follows:
"(m) Debt to Capitalization Ratio. Borrower's Debt to Capitalization
----------------------------
Ratio will, commencing June 30, 1995, never be greater than (i) 0.60 to 1.0 at
any time until and including October 31, 1996 and (ii) 0.55 to 1.0 at any time
thereafter."
- 2 -
Section 2.4. EBITDA/Interest Ratio.
---------------------
Section 5.2(p) of the Original Agreement is hereby amended in its
entirety to read as follows:
"(p) EBITDA/Interest Ratio. As of the end of each Fiscal Quarter,
---------------------
the ratio of Borrower's Consolidated EBITDA for the four immediately preceding
consecutive Fiscal Quarters to Borrower's Consolidated Interest Charges for such
period shall, commencing June 30, 1995, never be less than (i) 3.00 to 1.0 at
any time until and including October 31, 1996, (ii) 3.25 to 1.0 at any time
after October 31, 1996 until and including October 31, 1997, and (iii) 3.75 to
1.0 at any time after October 31, 1997. For purposes of this subsection, the
term "Borrower's Consolidated EBITDA" means the sum of (I) Borrower's
Consolidated earnings (or loss), after deduction of all expenses and other
charges other than interest, income tax and that certain $2,000,000
restructuring charge in the second Fiscal Quarter of 1995 as a result of
Borrower's general and administrative reductions plus (II) amounts deducted in
the computation of such Consolidated earnings (or loss) for depreciation,
amortization and other non-cash items. For purposes of this subsection the term
"Borrower's Consolidated Interest Charges" means the aggregate amount of
interest treated as an expense or capitalized on Borrower's consolidated
financial statements.
ARTICLE III.
Conditions of Effectiveness
---------------------------
Section 3.1. Effective Date. This Amendment shall become effective
--------------
as of the date first above written when, and only when, Agent shall have
received, at Agent's office, (i) a counterpart of this Amendment executed and
delivered by Borrower and Majority Lenders (ii) an amendment fee equal to ten-
one hundredths of one percent (0.10%) of the outstanding principal balance of
each Lender's Loans (as of the date hereof) payable to Agent for the account of
each Lender and (iii) each of the following, each document (unless otherwise
indicated) being dated the date of receipt thereof by Agent, duly authorized,
executed and delivered, and in form and substance satisfactory to Agent:
(a) a certificate of the Secretary of Borrower dated the date of
this Amendment certifying that: (A) the resolutions adopted by the
Board of Directors of Borrower attached as Exhibit 1 to the Omnibus
Certificate of Borrower dated September 2, 1994 (the "Original
Certificate") have not been amended or revoked, and continue in full
force and effect, (B) the incumbency and authorization of the officers
of Borrower authorized to sign Loan Documents, with signature
specimens of such officers, contained in the Original Certificate has
not been amended and continues in
- 3 -
full force and effect, (C) copies of the certified charter documents
of Borrower (including by-laws), attached as Exhibits H and O to the
Original Certificate have not been amended or revoked since the date
of the Original Certificate, and continue in full force and effect,
(D) no Default that has not been expressly waived by Lenders exists on
and as of the date hereof and (E) all of the representations and
warranties set forth in Article IV hereof and Article IV of the
Original Agreement are true and correct at and as of their respective
times of effectiveness;
(b) a favorable opinion from Messr. Xxxx Xxxxxx, Esq., counsel
for Borrower in a form acceptable to Lender; and
(c) such supporting documents as Agent may reasonably request.
ARTICLE IV.
Representations and Warranties
------------------------------
Section 4.1. Representations and Warranties of Borrower. In order to
------------------------------------------
induce each Lender to enter into this Amendment, Borrower represents and
warrants to each Lender that:
(a) The representations and warranties contained in each
subsection of Section 4.1 of the Original Agreement are true and
correct at and as of the time of the effectiveness hereof.
(b) Borrower is duly authorized to execute and deliver this
Amendment and is and will continue to be duly authorized to borrow
monies and to perform its obligations under the Loan Agreement.
Borrower has duly taken all corporate action necessary to authorize
the execution and delivery of this Amendment and to authorize the
performance of the obligations of Borrower hereunder and thereunder.
(c) The execution and delivery by Borrower of this Amendment, the
performance by Borrower of its obligations hereunder and the
consummation of the transactions contemplated hereby do not and will
not conflict with any provision of law, statute, rule or regulation or
of the articles of incorporation and bylaws of Borrower, or of any
material agreement, judgment, license, order or permit applicable to
or binding upon Borrower, or result in the creation of any lien,
charge or encumbrance upon any assets or properties of Borrower.
Except for those which have been obtained, no consent, approval,
authorization or order of any court or governmental authority or third
party is required in connection with the execution and delivery by
Borrower of this Amendment or to consummate the transactions
contemplated hereby.
- 4 -
(d) When duly executed and delivered, this Amendment and the Loan
Agreement will be a legal and binding obligation of Borrower,
enforceable in accordance with its terms, except as limited by
bankruptcy, insolvency or similar laws of general application relating
to the enforcement of creditors' rights and by equitable principles of
general application.
(e) The audited annual Consolidated financial statements of
Borrower dated as of December 31, 1994 and the unaudited quarterly
Consolidated financial statements of Borrower dated as of March 31,
1995 fairly present Borrower's Consolidated financial position at such
dates and the Consolidated results of Borrower's operations and
changes in Borrower's Consolidated cash flow for the respective
periods thereof. Copies of such financial statements have heretofore
been delivered to each Lender. Since March 31, 1995, no material
adverse change has occurred in the financial condition or businesses
or in the Consolidated financial condition or businesses of Borrower.
ARTICLE V.
Miscellaneous
-------------
Section 5.1. Ratification of Agreements. The Original Agreement as
--------------------------
hereby amended and each other Loan Document affected hereby are ratified and
confirmed in all respects. Any reference to the Loan Agreement in any Loan
Document shall be deemed to be a reference to the Original Agreement as hereby
amended. The execution, delivery and effectiveness of this Amendment shall not,
except as expressly provided herein, operate as a waiver of any right, power or
remedy of Agent or Lenders under the Loan Agreement or any other Loan Document
nor constitute a waiver of any provision of the Loan Agreement or any other Loan
Document.
Section 5.2. Survival of Agreements. All representations,
----------------------
warranties, covenants and agreements of Borrower herein shall survive the
execution and delivery of this Amendment and the performance hereof, including
without limitation the making or granting of the Loans, and shall further
survive until all of the Obligations are paid in full. All statements and
agreements contained in any certificate or instrument delivered by Borrower or
any Related Person hereunder or under the Loan Agreement to any Lender shall be
deemed to constitute representations and warranties by, and/or agreements and
covenants of, Borrower under this Amendment and under the Loan Agreement.
Section 5.3. Loan Documents. This Amendment is a Loan Document, and
--------------
all provisions in the Loan Agreement pertaining to Loan Documents apply hereto.
Section 5.4. Governing Law. This Amendment shall be governed by and
-------------
construed in accordance with the laws of the State of Texas and any applicable
laws of the United States of
- 5 -
America in all respects, including construction, validity and performance.
Section 5.5. Counterparts. This Amendment may be separately executed
------------
in counterparts and by the different parties hereto in separate counterparts,
each of which when so executed shall be deemed to constitute one and the same
Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed as of the date first written above by their duly authorized
officers.
WESTERN GAS RESOURCES, INC.
By:/S/ Xxxx X. Xxxxxx
-------------------
Name: Xxxx X. Xxxxxx
Title:
NATIONSBANK OF TEXAS, N.A.
By: /S/ Xxxxxxx X. Xxxxx
---------------------------
Name: Xxxxxxx X. Xxxxx
Title:
BANKERS TRUST COMPANY
By:/S/ Xxxx Xx Xxxxx
--------------------------
Name: Xxxx Xx Xxxxx
Title:
BANK OF MONTREAL
By:/S/ Xxxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxxx
Title:
CIBC INC.
By:/S/ Xxxx X. Xxxxxxx
--------------------------
Name: Xxxx X. Xxxxxxx
Title:
- 6 -
CONFIRMATION, ACKNOWLEDGEMENT AND CONSENT OF GUARANTORS
Each of the undersigned (collectively "Guarantors") hereby (i)
acknowledges and consents to the foregoing Fifth Amendment to Third Restated
Loan Agreement (Term); (ii) confirms the Restated Guaranty dated as of August
31, 1993 executed by such Guarantor in favor of Agent and the Lenders pursuant
to the Original Agreement; and (iii) agrees that each of such Guarantor's
obligations and covenants with respect to such Restated Guaranty shall remain in
full force and effect after the execution of such Amendment.
Xxxxxxx X. Xxxxxxx, Vice President-Finance of Western Gas Resources
Oklahoma, Inc., Western Gas Resources Texas, Inc., Western Gas Resources
Storage, Inc., Mountain Gas Resources, Inc., MGTC, Inc. and MIGC, Inc., is
executing this Confirmation, Acknowledgment and Consent of Guarantors in his
capacity of officer of each such corporation.
Dated as of the 19th day of July, 1995.
WESTERN GAS RESOURCES OKLAHOMA, INC.
WESTERN GAS RESOURCES TEXAS, INC.
WESTERN GAS RESOURCES STORAGE, INC.
MOUNTAIN GAS RESOURCES, INC.
MGTC, INC.
MIGC, INC.
By:/S/ Xxxxxxx X. Xxxxxxx
-------------------------------
Xxxxxxx X. Xxxxxxx,
Vice President-Finance
- 7 -
