1
EXHIBIT 10.22
SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
(this "Amendment") is among: HS RESOURCES, INC., a corporation formed under the
laws of the State of Delaware (the "Borrower"); each of the lenders that is a
signatory hereto; and THE CHASE MANHATTAN BANK (in its individual capacity,
"Chase"), as agent for the Lenders (in such capacity, together with its
successors in such capacity, the "Agent").
R E C I T A L S
A. The Borrower, the Agent, and the Lenders (as defined in the Credit
Agreement as hereafter defined) have entered into that certain Amended and
Restated Credit Agreement dated as of June 14, 1996 as amended by the First
Amendment to Amended and Restated Credit Agreement dated as of June 17, 1996 (as
amended, the "Credit Agreement"), pursuant to which the Lenders have agreed to
make certain loans and extensions of credit to the Borrower upon the terms and
conditions as provided therein; and
B. The Borrower, the Agent, and the Lenders now desire to make certain
amendments to the Credit Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration and the mutual benefits, covenants and agreements herein
expressed, the parties hereto now agree as follows:
1. All capitalized terms used in this Amendment and not otherwise
defined herein shall have the meanings ascribed to such terms in the Credit
Agreement.
2. The definitions of "Threshold Amount" and "Threshold Utilization
Percentage" in Section 1.02 of the Credit Agreement are hereby deleted, and
wherever the term "Threshold Utilization Percentage" is used in the Credit
Agreement, the term "Borrowing Base Utilization Percentage" (as hereinafter
defined) shall be substituted in place thereof.
3. The definitions "Applicable Margin," "Indenture," "Subordinated
Debt" and "Subordinated Notes" in Section 1.02 of the Credit Agreement are
hereby amended to read as follows:
"Applicable Margin" shall mean for Base Rate Loans or
Eurodollar Loans or the commitment fee pursuant to Section 2.04(a) the
following rate per annum as applicable based on the Borrowing Base
Utilization Percentage in effect from time to time:
2
--------------------------------------------------------------------------------------
Borrowing Base Utilization Eurodollar Base Rate Commitment
Percentage Loans Loan Fee
--------------------------------------------------------------------------------------
Greater than or equal to 80%, 1.250% 0.250% 0.375%
--------------------------------------------------------------------------------------
Greater than or equal to 60%, 1.1250% 0.1250% 0.375%
but less than 80%
--------------------------------------------------------------------------------------
Greater than or equal to 40%, 1.000% 0.000% 0.375%
but less than 60%
--------------------------------------------------------------------------------------
Less than 40% 0.750% 0.000% 0.300%
--------------------------------------------------------------------------------------
"Indentures" shall mean the 93 Indenture and the 96 Indenture.
"Subordinated Debt" shall mean the Debt of the Company
evidenced by the Subordinated Notes or the Indentures.
"Subordinated Notes" shall mean the 93 Subordinated Notes and
the 96 Subordinated Notes.
4. Section 1.02 of the Credit Agreement is hereby supplemented, where
alphabetically appropriate, with the addition of the following definitions:
"Borrowing Base Utilization Percentage" shall mean, as of any
day, the fraction expressed as a percentage, the numerator of which is
the balance of all Loans and LC Exposure outstanding on such day, and
the denominator of which is the Borrowing Base in effect on such day.
"93 Indenture" shall mean the Indenture between the Borrower,
as Issuer, and Xxxxxx Trust and Savings Bank, as Trustee, providing for
the issuance of $75,000,000 of Senior Subordinated Notes due December
1, 2003 and all renewals, extensions and modifications permitted by the
terms of this Agreement.
"96 Indenture" shall mean the Indenture between the Borrower,
as Issuer, the Guarantors and Xxxxxx Trust and Savings Bank, as
Trustee, providing for the issuance of $150,000,000 of Senior
Subordinated Notes due November 15, 2006 and all renewals, extensions
and modifications permitted by the terms of this Agreement.
"93 Subordinated Notes" shall mean the Senior Subordinated
Notes issued pursuant to the 93 Indenture.
"96 Subordinated Notes" shall mean the Senior Subordinated
Notes issued pursuant to the 96 Indenture.
-2-
3
"Second Amendment" shall mean that certain Second Amendment to
Amended and Restated Credit Agreement dated as of November 27, 1996,
among the Borrower, the Lenders and the Agent.
"Second Amendment Effective Date" shall mean the effective
date of the Second Amendment and shall be the same date as the
effective date of the 96 Indenture; provided, that the conditions
required by Section 9 of the Second Amendment have been satisfied.
5. Section 2.08 of the Credit Agreement is hereby amended to read as
follows:
"Section 2.08 Borrowing Base.
(a) The Borrowing Base shall be determined in accordance with
Section 2.08(b) by the Agent with the concurrence of the Super Majority
Lenders and is subject to redetermination in accordance with Section
2.08(d). Upon any redetermination of the Borrowing Base, such
redetermination shall remain in effect until the next successive
Redetermination Date. "Redetermination Date" shall mean the date that
the redetermined Borrowing Base becomes effective subject to the notice
requirements specified in Section 2.08(f) both for scheduled
redeterminations and unscheduled redeterminations. So long as any of
the Commitments are in effect or any LC Exposure or Loans are
outstanding hereunder, this facility shall be governed by the then
effective Borrowing Base. During the period from and after the Second
Amendment Effective Date until the first Redetermination Date
thereafter, the amount of the Borrowing Base shall be $275,000,000.
(b) Upon receipt of the reports required by Section 8.07 and
such other reports, data and supplemental information as may from time
to time be reasonably requested by the Agent (the "Engineering
Reports"), each Lender will redetermine the Borrowing Base. Such
redetermination will be in accordance with its normal and customary
procedures for evaluating oil and gas reserves and other related assets
as such exist at that particular time. Each Lender, in its sole
discretion, may make adjustments to the rates, volumes and prices and
other assumptions set forth therein in accordance with its normal and
customary procedures for evaluating oil and gas reserves and other
related assets as such exist at that particular time. The Agent shall
propose to the Lenders the new Borrowing Base within 30 days following
receipt by the Agent and the Lenders of the Engineering Reports in a
timely and complete manner. After having received notice of such
proposal by the Agent, the Super Majority Lenders shall have 15 days to
agree or disagree with such proposal. If at the end of the 15 days, the
Super Majority Lenders have not communicated their approval or
disapproval, such silence shall be deemed to be an approval and the
Agent's proposal shall be the new Borrowing Base. If however, the Super
Majority Lenders shall not have approved or have been deemed to have
approved the new Borrowing Base within 15 days, the Agent and the Super
Majority Lenders shall, within a reasonable period of time, agree on
the new Borrowing Base.
-3-
4
(c) The Agent may exclude any Oil and Gas Property or portion
of production therefrom or any income from any other Property from the
Borrowing Base, at any time, because title information is not
reasonably satisfactory.
(d) So long as any of the Commitments are in effect and until
payment in full of all Loans hereunder, on or around the fifteenth day
of each April, commencing April 15, 1997 (each being a "Scheduled
Redetermination Date"), the Super Majority Lenders shall redetermine
the amount of the Borrowing Base in accordance with Section 2.08(b). In
addition, the Super Majority Lenders or the Borrower may initiate a
redetermination of the Borrowing Base at any other time as they so
elect; provided, however, that the Borrower and the Super Majority
Lenders may each initiate only one such unscheduled redetermination
during any consecutive twelve (12) month period. In the event of a
redetermination initiated by the Super Majority Lenders, the Agent will
specify in writing to the Borrower the date on which the Borrower is to
furnish a Reserve Report in accordance with Section 8.07(b) and the
date on which such redetermination is to occur.
(e) The Agent shall promptly notify in writing the Borrower
and the Lenders of the new Borrowing Base. Any redetermination of the
Borrowing Base shall not be in effect until written notice is received
by the Borrower.
6. Sections 7.21 and 8.09 of the Credit Agreement are hereby amended by
substituting the word "Indentures" for the word "Indenture" in such sections.
7. Section 8.01 of the Credit Agreement is hereby amended by adding the
following clause (i):
"(i) At each time of delivery of the financial statements
required to be delivered pursuant to Sections 8.01(a) and (b) a report
in form and substance satisfactory to the Agent setting forth the use
of proceeds from asset sales and demonstrating compliance with Section
4.03(b)(i) of the 96 Indenture."
8. Section 9.01(g) of the Credit Agreement is hereby amended to read in
its entirety as follows:
"(g) the Subordinated Debt not to exceed at any time
$75,000,000 of principal outstanding under the 93 Subordinated Notes
and $150,000,000 of principal outstanding under the 96 Subordinated
Notes;"
9. The Credit Agreement is hereby amended by deleting Section 9.03(g)
and 9.15(v).
10. Section 9.20 of the Credit Agreement is hereby amended to read as
follows:
"Section 9.20 Subordinated Debt.
-4-
5
(a) The Borrower will not modify or amend the terms of the 93
Indenture as in existence on December 1, 1993 and any related documents
without the consent of the Majority Banks, if the effect of such
modification or amendment would be to shorten the time for payment on
any 93 Subordinated Notes, increase the principal amount of the 93
Subordinated Notes above $75,000,000, increase the rate of interest on
any 93 Subordinated Note or change the method of calculating interest
so as to effectively increase the rate of interest on any 93
Subordinated Note, change any of the provisions of Sections 2.3, 5.1,
Article VIII, Article X, Article XI, Article XII, Article XIII or
Article XIV, and Section 1.1 as to any of the definitions used in or
relating to any of the above Sections and Articles, or any other
provisions which would detrimentally effect the rights of the Banks.
The Indebtedness shall first be irrevocably and indefeasibly paid in
full in cash, or the immediate payment thereof duly provided for in
cash, and this Agreement terminated before the Company, any Subsidiary
or any Person acting on behalf of the Company or any Subsidiary shall
directly or indirectly pay, prepay, redeem, retire, repurchase or
otherwise acquire for value, or make a deposit pursuant to Article IV
of the 93 Indenture in respect of, or make any other prepayment,
payment or distribution (whether in cash, property, securities or
accommodation thereof or otherwise) on account of the principal of (or
premium, if any) or interest on, any 93 Subordinated Note or Subsidiary
Subordinat ed Debt related thereto; except that the Company may make
payments of interest that has accrued and is payable on the 93
Subordinated Notes pursuant to the terms of the 93 Indenture and pay
the principal of the 93 Subordinated Notes at the stated maturity of
December 1, 2003, provided that no Event of Default exists and is
continuing and such payment shall not cause an Event of Default.
(b) The Borrower will not modify or amend the terms of the 96
Indenture as in existence on November 27, 1996 and any related
documents without the consent of the Majority Banks, if the effect of
such modification or amendment would be to shorten the time for payment
on any 96 Subordinated Notes, increase the principal amount of the 96
Subordinated Notes above $150,000,000, increase the rate of interest on
any 96 Subordinated Note or change the method of calculating interest
so as to effectively increase the rate of interest on any 96
Subordinated Note, change the form of the reverse side of the Initial
Security or the Exchange Security issued under the 96 Indenture, change
any of the provisions of Section 6.01, Articles 3,4,5,10,11 and 12, and
Section 1.01 as to any of the definitions used in or relating to any of
the above Sections and Articles, or any other provisions which would
detrimentally effect the rights of the Banks. The Indebtedness shall
first be irrevocably and indefeasibly paid in full in cash, or the
immediate payment thereof duly provided for in cash, and this Agreement
terminated before the Company, any Subsidiary or any Person acting on
behalf of the Company or any Subsidiary shall directly or indirectly
pay, prepay, redeem, retire, repurchase or otherwise acquire for value,
or make a deposit pursuant to Article 8 of the 96 Indenture in respect
of, or make any other prepayment, payment or distribution (whether in
cash, property, securities or accommodation thereof or otherwise) on
account of the principal of (or premium, if any) or interest on, any 96
Subordinated Note or Subsidiary Subordinated Debt
-5-
6
related thereto; except that the Company may make payments of interest
that has accrued and is payable on the 96 Subordinated Notes pursuant
to the terms of the 96 Indenture and pay the principal of the 96
Subordinated Notes at the stated maturity of November 15, 2006,
provided that no Event of Default exists and is continuing and such
payment shall not cause an Event of Default."
11. Annex I of the Credit Agreement is hereby replaced by Annex I to
this Amendment.
12. This Amendment shall become binding on the Lenders when, and only
when, the following conditions shall have been satisfied and the Agent shall
have received each of the following, as applicable, in form and substance
satisfactory to the Agent or its counsel:
(a) counterparts of this Amendment executed by the Borrower
and the Majority Lenders;
(b) a copy of the 96 Indenture;
(c) the issuance of the 96 Subordinated Notes for the
principal amount of $150,000,000;
(d) Orion or the Borrower shall have purchased and received an
assignment of all of the Oil & Gas Properties of WRL; and
(e) such other documents as it or its counsel may reasonably
request.
13. The parties hereto hereby acknowledge and agree that, except as
specifically supplemented and amended, changed or modified hereby, the Credit
Agreement shall remain in full force and effect in accordance with its terms.
14. The Borrower hereby reaffirms that as of the date of this
Amendment, the representations and warranties contained in Article VII of the
Credit Agreement are true and correct on the date hereof as though made on and
as of the date of this Amendment, except as such representations and warranties
are expressly limited to an earlier date.
15. THIS AMENDMENT (INCLUDING, BUT NOT LIMITED TO, THE VALIDITY AND
ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK, OTHER THAN THE CONFLICT OF LAWS RULES
THEREOF.
16. This Amendment may be executed in two or more counterparts, and it
shall not be necessary that the signatures of all parties hereto be contained on
any one counterpart hereof; each counterpart shall be deemed an original, but
all of which together shall constitute one and the same instrument.
-6-
7
[SIGNATURES BEGIN NEXT PAGE]
-7-
8
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of November 27, 1996.
BORROWER: HS RESOURCES, INC.
By: /s/ XXXXX X. XXXXX
----------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
LENDER AND AGENT: THE CHASE MANHATTAN BANK
By: /s/ XXXX XX XXXXXXXX
----------------------------
Name: Xxxx Xx Xxxxxxxx
Title: Vice President
LENDERS: CIBC INC.
By: /s/ XXXXXXXXXX X. XXXXXXX
----------------------------
Name: Xxxxxxxxxx X. Xxxxxxx
Title: Authorized Signatory
XXXXX FARGO BANK, N.A.
By: /s/ XXXXX RHEEM
----------------------------
Name: Xxxxx Rheem
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ PASCAL POUPELLE
----------------------------
Name: Pascal Poupelle
Title: Senior Vice President
S - 1
9
UNION BANK OF CALIFORNIA, N.A.
By: /s/ XXXXXXX X. XXXXXXXXX
-------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
ROYAL BANK OF CANADA
By: /s/ XXXX XXXXXXXXXX
-------------------------
Name Xxxx Xxxxxxxxxx
Title: Associate
DEN NORSKE BANK ASA
By: /s/ XXXXXXX X. XXXX
-------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior Vice President
By: /s/ JAN XXXXXX XXXXXX
-------------------------
Name: Jan Xxxxxx Xxxxxx
Title: Vice President
MEESPIERSON, N.V.
By: /s/ XXXXXXX X. XXXXXX
-------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
S - 2
10
ABN AMRO BANK N.V.
San Francisco International Branch
By: ABN AMRO NORTH AMERICA, INC.,
as agent
By: /s/ XXXXXXXX X. XXXXX
-----------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Officer
By: /s/ X. X. XXXXXXX
-----------------------------------
Name: X. X. Xxxxxxx
Title: Group Vice President
FIRST UNION NATIONAL BANK OF NORTH
CAROLINA
By: /s/ XXXXXXX X. XXXXXXXXXX
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President
THE SANWA BANK, LIMITED
By: /s/ XXXXXXXX XXXX
-----------------------------------
Name: Xxxxxxxx Xxxx
Title: Vice President
SOCIETE GENERALE
By: /s/ XXXXXXX X. XXXXX
-----------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
S - 3
11
BANQUE PARIBAS
By: /s/ XXX XxXXXXX
----------------------------------
Name: Xxx XxXxxxx
Title: Vice President
By: /s/ XXX XXXXX, XX.
----------------------------------
Name: Xxx Xxxxx, Xx.
Title: Managing Director
CAISSE NATIONALE DE CREDIT AGRICOLE
By: /s/ XXXXX XXXXX, FVP
----------------------------------
Name: Xxxxx Xxxxx
Title: President of Corporate Banking
S - 4
