FIRST AMENDMENT TO CREDIT AGREEMENT
Exhibit 10.2
Execution Version
FIRST AMENDMENT TO CREDIT AGREEMENT
This First Amendment to Credit Agreement (this “Amendment”) is entered into effective as of 31st day of March, 2016 (the “Effective Date”), by and among Gran Tierra Energy International Holdings Ltd., an exempted company incorporated with limited liability under the laws of the Cayman Islands (the “Borrower”), Gran Tierra Energy Inc., a (the “Parent”), The Bank of Nova Scotia, as administrative agent (the “Administrative Agent”) and the Lenders party hereto.
WHEREAS, Borrower, the Parent, the Administrative Agent, and Lenders are parties to that certain Credit Agreement dated as of September 18, 2015 (as amended, supplemented or otherwise modified prior to the date hereof, the “Credit Agreement”) (unless otherwise defined herein, all terms used herein with their initial letter capitalized shall have the meaning given such terms in the Credit Agreement as amended by this Amendment);
WHEREAS, pursuant to the Credit Agreement, Lenders have made certain Loans to the Borrower and provided certain other credit accommodations to Borrower;
WHEREAS, the Administrative Agent, Borrower and the Lenders have agreed to enter into this Amendment to amend the Credit Agreement as more particularly set forth herein; and
Section 1. Amendments. In reliance on the representations, warranties, covenants and agreements contained in this Amendment, and subject to the satisfaction of the conditions precedent set forth in Section 2 hereof, the Credit Agreement shall be amended, effective as of the Effective Date in the manner provided in this Section 1.
1.1 Additional Definitions. Section 1.02 of the Credit Agreement shall be amended by inserting the following definitions in appropriate alphabetical order, which shall read in full as follows:
“Convertible Senior Notes” means any Senior Debt that is convertible into, or exchangeable for, Equity Interests constituting common stock of any Credit Party.
“Convertible Senior Notes Indenture” means any indenture (including the Initial Convertible Senior Notes Indenture) pursuant to which any Convertible Senior Notes are issued.
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"Convertible Senior Notes Documents" shall mean, collectively, any notes evidencing any Convertible Senior Notes, any Convertible Senior Notes Indenture, and all other agreements, documents and instruments now or at any time executed and delivered by the Parent or any other Credit Party in connection with any Convertible Senior Notes.
“Excluded Cash” means, with respect to cash and Cash Equivalents held by the Credit Parties, on any date of determination, any (i) Cash Collateral, (ii) cash collateral or cash deposits received from a Person (other than a Credit Party) and held by a Credit Party, (iii) cash collateral given by a Credit Party to another Person (other than a Credit Party) and other cash, in each case, held by or on behalf of, another Person (other than a Credit Party) pursuant to any contractual or regulatory obligation, (iv) cash necessary to cover daylight overdrafts, and (v) cash on hand necessary to fund (A) those obligations payable within the immediately succeeding five Business Days and (B) those trade or trading obligations to be prepaid in the ordinary course of business in lieu of posting collateral within the immediately succeeding five Business Days.
“Fundamental Change” has the meaning given to the term “fundamental change” in the Initial Convertible Senior Notes Indenture or the meaning given to the term “fundamental change” as defined in any other Convertible Senior Notes Indenture in a manner substantially consistent with the definition of “fundamental change” as defined in the Initial Convertible Senior Notes Indenture.
"Initial Convertible Senior Notes Indenture " shall mean an indenture that provides for the issuance of Convertible Senior Notes on substantially those terms set forth in that certain Preliminary Offering Memorandum, dated as of March 31, 2016.
1.2 Amended and Restated Definitions. Section 1.02 of the Credit Agreement shall be amended by amending and restating the following definitions, which shall read in full as follows:
“Material Indebtedness” means Debt (other than the Loans and Letters of Credit), including, but not limited to, any Convertible Senior Notes or obligations in respect of one or more Swap Agreements, of any one or more of the Parent or any Subsidiary or, with respect to Section 7.07(b) only, any Credit Party, in an aggregate principal amount exceeding $10,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Parent or any Subsidiary or, with respect to Section 7.07(b) only, any Credit Party, in respect of any Swap Agreement at any time shall be the Swap Termination Value of such Swap Agreement.
“Senior Debt” means any unsecured Debt securities (whether registered or privately placed), including but not limited to any Convertible Senior Notes, issued or incurred by the Parent or any other Credit Party pursuant to one or more Senior Debt Documents.
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(e) Excess Cash Balances. If at any time while Loans are outstanding the Credit Parties have any cash equivalents (other than Excluded Cash) in excess of $35,000,000 in the aggregate at any time for a period of three Business Days (the “Excess Cash”), the Borrower shall, on the following Business Day (i) prepay the Borrowings in an aggregate principal amount equal to such excess and (ii) if any excess remains after prepaying all of the Borrowings as a result of an LC Exposure, Cash Collateralize such excess as provided in Section 2.08(j). Each prepayment of Borrowings pursuant to this Section 3.04(e) shall be applied, first, ratably to any ABR Borrowings then outstanding, and, second, to any Eurodollar Borrowings then outstanding, and if more than one Eurodollar Borrowing is then outstanding, to each such Eurodollar Borrowing in order of priority beginning with the Eurodollar Borrowing with the least number of days remaining in the Interest Period applicable thereto and ending with the Eurodollar Borrowing with the most number of days remaining in the Interest Period applicable thereto. Each prepayment of Borrowings pursuant to this Section 3.04(e) shall be applied ratably to the Loans included in the prepaid Borrowings. Prepayments pursuant to this Section 3.04(e) shall be accompanied by accrued interest to the extent required by Section 3.02.
(d) At the time of and immediately after giving effect to such Borrowing or the issuance, amendment, renewal or extension of such Letter of Credit, as applicable, the Borrower together with the other Credit Parties shall not have any cash or cash equivalents (other than Excluded Cash) in excess of $35,000,000 in the aggregate.
1.8 Amendment to Section 9.02(g) of the Credit Agreement. Section 9.02(g) of the Credit Agreement shall be amended and restated to read in full as follows:
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(g) Senior Debt of the Parent or any other Credit Party, and any guarantees thereof, the principal amount of which does not exceed $600,000,000 in the aggregate at any one time outstanding; provided, that the principal amount of any Convertible Senior Notes shall not exceed $150,000,000 in the aggregate at any one time outstanding; provided further that: (A) the Borrower shall have complied with Section 8.01(t); (B) both before and immediately after giving effect to the incurrence of any such Senior Debt, no Default, Event of Default or Borrowing Base Deficiency exists or would exist (after giving effect to any concurrent repayment of Debt with the proceeds of such incurrence, if any); (C) the Parent is in Pro Forma Compliance after giving effect to the incurrence of any such Debt and the transactions contemplated thereby (and the Parent shall deliver to the Administrative Agent on the date of incurrence thereof a certificate of a Financial Officer setting forth reasonably detailed calculations demonstrating Pro Forma Compliance); (D) such Senior Debt does not have any scheduled principal amortization prior to the date which is one hundred eighty days after the Maturity Date (as in effect on the date of the incurrence of such Senior Debt); (E) such Senior Debt does not have a scheduled maturity sooner than the date which is one hundred eighty days after the Maturity Date (as in effect on the date of the incurrence of such Senior Debt); (F) no Subsidiary is required to guarantee such Senior Debt unless such Subsidiary has guaranteed the Secured Obligations pursuant to the Guaranty Agreement (by supplement, joinder or otherwise) and/or one or more other guaranty agreements on terms satisfactory in form and substance to the Administrative Agent; (G) if such Senior Debt is senior subordinated Debt, such Senior Debt is expressly subordinate to the payment in full of all of the Secured Obligations on terms and conditions reasonably satisfactory to the Administrative Agent; (H) (i) in the case of Senior Debt (other than any Convertible Senior Notes issued pursuant to the Initial Convertible Senior Notes Indenture) and any guarantees thereof, such Senior Debt and any guarantees thereof are on terms, taken as a whole, no more restrictive on the Parent or any other Credit Party than the terms and conditions of this Agreement, taken as a whole, as reasonably determined by the Board of Directors of the Parent, acting in good faith and evidenced by a resolutions of such Board of Directors and (ii) in the case of any Convertible Senior Notes issued pursuant to the Initial Convertible Senior Notes Indenture and any guarantees thereof, such Convertible Senior Notes and any guarantees thereof are on terms, taken as a whole, no more restrictive on the Parent or any other Credit Party than the terms and conditions of this Agreement, taken as a whole, as reasonably determined by a Responsible Officer of the Parent, acting in good faith, and certified to the Administrative Agent; and (I) such Senior Debt does not have any mandatory prepayment or mandatory redemption provisions (other than customary change of control or asset sale tender offer provisions and, in the case of any Convertible Senior Notes, customary provisions requiring the repurchase of such Convertible Senior Notes upon the occurrence of a Fundamental Change) that would require a mandatory prepayment or redemption in priority to the Secured Obligations.
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1.10 Amendment to Section 9.04(b) of the Credit Agreement. Section 9.04(b) of the Credit Agreement shall be amended to add the following sentence at the end of such Section 9.04(b) which shall read in full as follows:
For the avoidance of doubt, shares of common stock and cash issued in lieu of fractional shares of common stock, in each case issued upon conversion or exchange of any Convertible Senior Notes shall not be prohibited by this Section 9.04(b).
Section 2. Conditions Precedent. The amendments to the Credit Agreement contained in Section 1 hereof shall each be effective on the date that each of the following conditions precedent is satisfied or waived in accordance with Section 12.02 of the Credit Agreement:
Section 3. Representations and Warranties of Borrower. To induce the Lenders and Administrative Agent to enter into this Amendment, Borrower hereby represents and warrants to Lenders and Administrative Agent as follows:
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4.8 Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
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BORROWER: | gran tierra energy international holdings ltd. | |
By: | /s/ Xxxxxx Coral | |
Name: | Xxxxxx Coral | |
Title: | Director | |
PARENT: | GRAN TIERRA ENERGY INC. | |
By: | /s/ Xxxxx Xxxxx | |
Name: | Xxxxx Xxxxx | |
Title: | Legal & General Counsel |
Signature Page –Amendment
ADMINISTRATIVE AGENT: | THE BANK OF NOVA SCOTIA, | |
By: | /s/ Xxxxxx Xxxxx | |
Name: | Xxxxxx Xxxxx | |
Title: | Director, International Banking | |
By: | /s/ Xxxxxxx Xxxxxxx | |
Name: | Xxxxxxx Xxxxxxx | |
Title: | Director, International Banking |
Signature Page –Amendment
LENDERS: | THE BANK OF NOVA SCOTIA, as a Lender | |
By: | /s/ Xxxxxx Xxxxx | |
Name: | Xxxxxx Xxxxx | |
Title: | Director, International Banking | |
By: | /s/ Xxxxxxx Xxxxxxx | |
Name: | Xxxxxxx Xxxxxxx | |
Title: | Director, International Banking |
Signature Page –Amendment
SOCIÉTÉ GÉNÉRALE, | ||
as a Lender | ||
By: | /s/ Xxx Xxxxxxxxxxx | |
Name: | Xxx Xxxxxxxxxxx | |
Title: | Director |
Signature Page –Amendment
HSBC Bank Canada, | ||
as a Lender | ||
By: | ||
Name: | ||
Title: |
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Export Development Canada, | ||
as a Lender | ||
By: | /s/ Xxxxxx Xxxxxxxx | |
Name: | Xxxxxx Xxxxxxxx | |
Title: | Asset Manager | |
By: | /s/ Xxxxxxx Xxxxx | |
Name: | Xxxxxxx Xxxxx | |
Title: | Asset Manager |
Signature Page –Amendment
Natixis, New York Branch, | ||
as a Lender | ||
By: | ||
Name: | ||
Title: |
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Royal Bank of Canada, | ||
as a Lender | ||
By: | /s/ Xxxxx X. Hushovd | |
Name: | Xxxxx X. Hushovd | |
Title: | Authorized Signatory |
Signature Page –Amendment