Exhibit 10.8
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AMENDED AND RESTATED
CREDIT AGREEMENT
AMONG
BONNEVILLE FUELS CORPORATION,
BONNEVILLE FUELS MARKETING CORPORATION,
COLORADO GATHERING CORPORATION,
BONNEVILLE FUELS OPERATING CORPORATION,
AND
BONNEVILLE FUELS MANAGEMENT CORPORATION,
as Borrowers
AND
FIRST INTERSTATE BANK OF DENVER, N.A.,
as Lender
Dated as of
May 31, 1994
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TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS................................ 2
ARTICLE II THE CREDIT..................................................... 10
(a) Loans and Letters of Credit................................. 11
(b) Conversion of Facility A Prime Rate Loans................... 11
ARTICLE III FEES, PROCEDURES AND PAYMENT.................................. 12
(a) Facility Fee................................................ 12
(b) Borrowing Base Commitment Fees.............................. 12
(c) Letter of Credit Fees....................................... 12
(d) Facility A Prepayment Fee................................... 13
(e) General..................................................... 13
(f) Interest Periods............................................ 13
(g) Facility A.................................................. 15
(h) Facility B.................................................. 15
ARTICLE IV BORROWING BASE................................................. 16
(a) Facility A.................................................. 16
(b) Facility B.................................................. 16
ARTICLE V CONDITIONS OF LENDING........................................... 20
ARTICLE VI SECURITY....................................................... 22
ARTICLE VII REPRESENTATIONS AND WARRANTIES................................ 23
(a) Existence; Standing......................................... 23
(b) Qualification to Do Business................................ 23
(c) Due Authorization........................................... 23
(d) Approvals................................................... 24
(e) Binding Obligations......................................... 24
(f) Financial Statements........................................ 24
(g) Use of Proceeds............................................. 24
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(h) Regulation U.............................................. 24
(i) Investment Company Act.................................... 24
(j) Other Obligations......................................... 24
(k) Full Disclosure........................................... 25
(l) No Litigation............................................. 25
(m) No ERISA Liability........................................ 25
(n) Title to Mortgaged Properties............................. 25
(o) Existing Subsidiaries..................................... 25
(p) Drilling and Operations................................... 25
(q) Qualification to Hold Federal Oil and Gas Leases.......... 26
(r) Environmental............................................. 26
ARTICLE VIII COVENANTS OF THE BORROWERS................................. 27
(a) Payment and Performance................................... 27
(b) Books, Financial Statements and Reports................... 27
(c) Other Information and Inspections......................... 29
(d) Notice of Material Events................................. 29
(e) Financial Covenants....................................... 30
(f) Maintenance of Existence and Qualifications............... 30
(g) Maintenance of Properties................................. 30
(h) Payment of Taxes, Etc..................................... 31
(i) Insurance................................................. 31
(j) Books and Records......................................... 31
(k) Payment of Expenses....................................... 31
(l) Performance on the Borrowers' Behalf...................... 31
(m) Compliance with Agreements and Law........................ 32
(n) Evidence of Compliance.................................... 32
(o) Further Assurances........................................ 32
(p) Production Purchasers..................................... 32
(q) Environmental Laws........................................ 32
(r) Limitation on Dividends and Distributions................. 33
(s) Limitation on Stock Repurchase............................ 33
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(t) Limitation on Indebtedness................................. 33
(u) Limitation on Liens........................................ 34
(v) Limitation on Mergers...................................... 34
(w) Limitation on Sales of Property............................ 34
(x) Fiscal Year................................................ 34
(y) Amendment of Contracts..................................... 34
(z) Limitation on Investments and New Businesses............... 35
(aa) Limitation on Credit Extensions........................... 35
(bb) ERISA Compliance.......................................... 35
(cc) Limitation on Certain Repayments.......................... 35
(dd) Limitation on Payments to BPC............................. 35
ARTICLE IX EVENTS OF DEFAULT AND THEIR EFFECT............................ 36
(a) Nonpayment of Notes........................................ 36
(b) Collateral Documents....................................... 36
(c) Representations And Warranties............................. 36
(d) Noncompliance With Specific Provisions Of This Agreement... 36
(e) Noncompliance With This Agreement.......................... 36
(f) Nonpayment Of Other Indebtedness For Borrowed Money........ 36
(g) Bankruptcy, Insolvency, Etc................................ 36
(h) Material Adverse Change.................................... 37
(i) Judgment................................................... 37
(j) American Atlas Contract.................................... 37
Section 9.1 Effect of the Occurrence of an Event of Default............. 37
ARTICLE X MISCELLANEOUS.................................................. 38
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EXHIBITS
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EXHIBIT A-1 FORM OF FACILITY A NOTE
EXHIBIT A-2 FORM OF FACILITY B NOTE
EXHIBIT A-3 FORM OF TERM NOTE
EXHIBIT B FORM OF REQUEST FOR CREDIT
EXHIBIT C FORM OF A/R BORROWING BASE CERTIFICATE
EXHIBIT D FORM OF INTEREST PERIOD/CONVERSION NOTICE
EXHIBIT E FORM OF OPINION OF BORROWERS' COUNSEL
EXHIBIT F FORM OF SECURITY OPINION
EXHIBIT G FORM OF OMNIBUS CERTIFICATE
SCHEDULES
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SCHEDULE 6.3 SECURITY OPINION PROPERTIES
SCHEDULE 7.1(d) APPROVALS
SCHEDULE 7.1(j) OTHER OBLIGATIONS
SCHEDULE 7.1(1) PENDING LITIGATION
SCHEDULE 7.1(n) LIENS AND ENCUMBRANCES
SCHEDULE 7.1(r) ENVIRONMENTAL DISCLOSURE
SCHEDULE 8.2(c) EXISTING DEBT
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AMENDED AND RESTATED
CREDIT AGREEMENT
This Amended and Restated Credit Agreement is made and entered into as of
the 31st day of May, 1994, by and among BONNEVILLE FUELS CORPORATION, a Colorado
corporation ("BFC"), BONNEVILLE FUELS MARKETING CORPORATION, a Utah corporation
("BFMC"), COLORADO GATHERING CORPORATION, a Utah Corporation ("CGC"), BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation ("BFOC"), and BONNEVILLE FUELS
MANAGEMENT CORPORATION, a Utah corporation ("BFM Corp.," with BFC, BFMC, CGC,
BFOC, and BFM Corp., referred to collectively as "Borrowers" and individually as
a "Borrower"), and FIRST INTERSTATE BANK OF DENVER, N.A., a national banking
association (the "Bank").
RECITALS
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A. The Borrowers are collectively engaged in the business of exploring
for, producing, gathering and marketing of natural gas and oil, and require
funds for working capital needs and for other general corporate purposes.
B. Pursuant to a Credit Agreement dated as of August 30, 1991 (the "Chase
Credit Agreement") BFC has heretofore borrowed certain funds from Chase
Manhattan Bank (National Association) ("Chase"). The funds so borrowed by BFC
are evidenced by a Note dated as of August 30, 1991 (the "Chase Note"), the
outstanding principal balance of which is $7,368,725 as of the date hereof (the
"Chase Loan"). The obligations of BFC under the Chase Credit Agreement, Chase
Note and certain other agreements executed in connection therewith are secured
by various collateral security documents creating liens and encumbrances on and
security interests in certain real and personal property of BFC (collectively,
the "Chase Collateral Documents," with the Chase Credit Agreement, the Chase
Note and the Chase Collateral Documents sometimes referred to collectively as
the "Chase Documents").
C. Contemporaneously with the execution of this Agreement, the Bank is
acquiring the Chase Loan and is receiving from Chase a conveyance of the Chase
Documents.
D. The Bank has agreed to extend credit to all of the Borrowers, and the
Bank and the Borrowers desire hereby to amend and restate the Chase Credit
Agreement in its entirety to reflect the continuation of the principal balance
of the Chase Loan currently outstanding, to add the Borrowers in addition to BFC
as parties liable for repayment of the Chase Loan, and to provide for certain
other credit facilities, all on the terms and conditions set forth herein.
AGREEMENT
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NOW, THEREFORE, IN CONSIDERATION of the following mutual covenants and
other good and valuable consideration, the Borrowers and the Bank agree that the
outstanding principal balance of the Chase Loan constitutes a Loan hereunder for
all purposes, and the Chase Credit Agreement is hereby amended and restated in
its entirety to read as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.1 Certain Defined Terms. As used in this Agreement, the following
terms shall have the indicated meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Accounts Receivable Report" means a monthly report of its outstanding
accounts receivable, including aging, in form acceptable to the Bank, submitted
by BFMC and BFM Corp. to the Bank pursuant to Section 8.1(b)(vii).
"Advance" means, as a verb, the advance of the Loans by the Bank to the
Borrowers pursuant to Article II, and as a noun, the funds so Advanced.
"Advance Date" means any day on which an Advance is made hereunder.
"Agreement" means this Credit Agreement as the same may be amended from
time to time.
"AAA" means the American Arbitration Association.
"American Atlas Contract" means the Amended and Restated Gas Sales
Agreement dated January 1, 1993 between BFC, as seller, and American Atlas #1,
Ltd., as buyer.
"Amortizing Period" means, with regard to Facility A, the period following
the Conversion Date during which the Facility A Loan will be repaid by the
Borrowers, as established by the Bank pursuant to Section 3.3.
"A/R Borrowing Base" has the meaning specified in Sections 4.1(b) and 4.4.
"A/R Borrowing Base Redetermination" has the meaning specified in Section
4.4.
"Bank" means First Interstate Bank of Denver, N.A., and its successors and
assigns.
"Borrowers" mean Bonneville Fuels Corporation, a Colorado corporation,
Bonneville Fuels Marketing Corporation, a Utah corporation, Colorado Gathering
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Corporation, a Utah Corporation, Bonneville Fuels Operating Corporation, a Utah
corporation, and Bonneville Fuels Management Corporation, a Utah corporation.
"BPC" means Bonneville Pacific Corporation, a Delaware corporation.
"Borrowing Base Commitment Fees" mean the fees payable by the Borrowers to
the Bank pursuant to Section 3.1(b).
"Breakage Costs" mean the aggregate net amount of all costs and losses
which the Bank actually incurs as a result of payment of the Principal Amount of
any LIBOR Loan other than at the end of an Interest Period, the Bank's good
faith computation of such costs and losses to be conclusive and binding in the
absence of error, and the amount thereof to be paid in same day funds upon
demand by the Bank.
"Business Day" means any day of the year not a Saturday or Sunday on which
banks in Denver, Colorado are open for business.
"Chase" means Chase Manhattan Bank (National Association).
"Chase Collateral Documents" mean the various collateral security documents
creating liens and encumbrances on and security interests in certain real and
personal property of BFC that secure the Chase Loan.
"Chase Credit Agreement" means the credit agreement dated as of August 30,
1991 between BFC and Chase.
"Chase Documents" mean the Chase Credit Agreement, the Chase Note and the
Chase Collateral Documents.
"Chase Loan" means the outstanding principal balance of the funds advanced
by Chase to BFC, as evidenced by the Chase Note.
"Chase Note" means the note dated as of August 30, 1991 between BFC and
Chase evidencing the Chase Loan.
"Chase Transfer Documents" mean assignments and other instruments of
transfer in form reasonably satisfactory to the Bank, transferring the Chase
Loan and Chase Documents to the Bank.
"Closing Date" means June 27, 1994.
"Collateral" means at any time, properties, assets, rights and interests of
the Borrowers in which the Bank has an encumbrance, lien or security interest
pursuant to the Collateral Documents.
"Collateral Documents" mean the deeds of trust, mortgages, chattel
mortgages, assignments of proceeds, security agreements, financing statements,
pledge agreements
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and other instruments in form and substance satisfactory to the Bank executed by
the Borrowers as provided in Section 6.1, together with the Chase Collateral
Documents and the Chase Transfer Documents, granting to and perfecting in favor
of the Bank first and prior liens on or security interests in the properties,
assets, rights and interests of the Borrowers described in such documents.
"Commitment" means the aggregate undertaking of the Bank pursuant to the
Facility A Commitment and the Facility B Commitment.
"Conversion Date" means the date on which the Borrowers' right to borrow,
repay and reborrow amounts under Facility A shall terminate as provided in
Section 3.3 and on which the outstanding Principal Amount of the Facility A
Loans shall become a Term Loan, subject to the Term Note, payable in
installments as provided in Section 3.3. The Conversion Date will be April 1,
1996, unless the parties elect to extend the Conversion Date by mutual written
agreement or, if earlier, the date on which the Revolving Loans terminate
pursuant to Section 3.3.
"Draw" means funds paid by the Bank to beneficiaries of and pursuant to
Letters of Credit, which funds shall constitute Facility A Loans or Facility B
Loans depending upon the facility pursuant to which the Letter of Credit was
issued under which the Draw occurs.
"Debt" means (i) indebtedness for borrowed money or for the deferred
purchase price of property or services; (ii) obligations as lessee under leases
which shall have been or should be, in accordance with generally accepted
accounting principles, regarded as capital leases; (iii) obligations under
direct or indirect guarantees in respect of, and obligations (contingent or
otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor
against loss in respect of, indebtedness or obligation of others of the kinds
referred to in clause (i) or (ii) above; and (iv) liabilities in respect of
unfunded vested benefits under plans covered by Title IV of ERISA.
"Default Interest Rate" means a rate of interest per annum equal to (i) the
Prime Rate in effect from time to time, plus (ii) four percent (4%).
"Eligible Accounts Receivable" has the meaning specified in Section 4.4.
"Environmental Laws" mean any federal, state or local law, statute, rule,
regulation, ordinance, order or determination pertaining to health or the
environment in effect in any and all jurisdictions in which the Borrowers are
conducting or at any time have conducted business, or where any property of the
Borrowers is located, or where any Hazardous Materials generated by or disposed
of by the Borrowers are located, including, without limitation, the Clean Air
Act, as amended; the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980 ("CERCLA"), as amended; the Federal Water Pollution
Control Act, as amended; the Resource Conservation and Recovery Act ("RCRA") as
amended, the Safe Drinking Water Act, as amended; the Toxic Substances Control
Act, as amended; the Oil Pollution Act of 1990,
4
as amended; the Hazardous Materials Transportation Act, as amended; and any
other environmental conservation or protection laws.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Event of Default" means any one of the events described in Section 9.1.
"Face Amount" means the maximum amount the Bank is contingently obligated
to pay to the beneficiary of a Letter of Credit.
"Facility A Commitment" means (A) prior to the Conversion Date, the
undertakings of the Bank to Advance Facility A Loans to the Borrowers on a joint
and several liability basis from time to time on a revolving basis and to issue
Letters of Credit for the account of the Borrowers on a joint and several
liability basis from time to time; and (B) effective on the Conversion Date, the
undertaking of the Bank to extend the Principal Amount of Loans outstanding on
the Conversion Date on a nonrevolving, amortizing basis as a Term Loan maturing
on the Facility A Maturity Date, with the aggregate Principal Amount of such
Loans and Face Amount of such Letters of Credit at no time to exceed the lesser
of (i) the Maximum Credit Amount for Facility A or (ii) the Production Borrowing
Base from time to time.
"Facility A Loans" mean Loans Advanced to the Borrowers prior to the
Conversion Date pursuant to the Facility A Commitment and Draws under Letters of
Credit issued pursuant to the Facility A Commitment.
"Facility A Note" means the Revolving Note in the form of Exhibit A-1
hereto, which evidences the Facility A Loans.
"Facility A Maturity Date" means the earlier of (i) the Facility A
Scheduled Maturity Date and (ii) the date on which the Facility A Loans are
payable by reason of Event of Default and an acceleration of the due date of
such Loans by the Bank pursuant to Section 9.2.
"Facility A Prepayment Fee" means the fee payable by the Borrowers to the
Bank pursuant to Section 3.1(d).
"Facility A Scheduled Maturity Date" means April 1, 2001.
"Facility B Commitment" means the undertakings of the Bank to Advance
Facility B Loans on a revolving basis solely to BFMC and BFM Corp. (but as the
joint and several liability of all the Borrowers) as demand Loans and to issue
Letters of Credit solely for the account of BFMC and BFM Corp. (but as the joint
and several liability of all the Borrowers) from time to time prior to the
Facility B Maturity Date, with the aggregate Principal Amount of such Loans and
Face Amount of such Letters of Credit at no time to exceed the lesser of (i) the
Maximum Credit Amount for Facility B or the (ii) A/R Borrowing Base from time to
time.
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"Facility B Loans" mean Loans Advanced to BFMC and BFM Corp. (but as the
joint and several liability of all the Borrowers) pursuant to the Facility B
Commitment and Draws under Letters of Credit issued pursuant to the Facility B
Commitment.
"Facility B Note" means the promissory note in the form of Exhibit A-2
hereto, which evidences the Facility B Loans.
"Facility B Maturity Date" means the earlier of (i) the date on which
demand for payment of the Facility B Loans is made by the Bank and (ii) April 1,
1995 or such later date as may be established by mutual agreement of the Parties
pursuant to Section 2.3.
"Facility Fee" means the fee payable by the Borrowers to the Bank pursuant
to Section 3.1(a).
"Governmental Acts" has the meaning specified in Section 3.10.
"Governmental Authority" means any nation or government, any state, county,
municipality or other political subdivision thereof, or any governmental body,
agency, authority, department or commission, or any instrumentality or officer
thereof exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Gross Revenue" means an amount determined by multiplying (y) the amount of
each unit of hydrocarbons sold from and attributable to the Borrowers' net
revenue interests in the Mortgaged Properties by (z) the respective gross sales
prices paid to the Borrowers by the first purchasers of production at the well
head for the corresponding period, which prices may be net of gathering,
processing, transportation and marketing charges in accordance with the terms of
applicable sales agreements.
"Hazardous Materials" means hazardous substance as that term is defined in
CERCLA at 42 U.S.C. Section 9601(14) and hazardous waste as that term is defined
in RCRA at 42 U.S.C. Section 6903(5).
"Initial Advance" means the Advance to be made on the Closing Date under
this Agreement.
"Interest Period" means, with respect to any LIBOR Loan, a period from the
Advance Date or date of renewal with respect to such LIBOR Loan to a date which
is one (1), two (2) or three (3) months thereafter; provided that:
(i) the Interest Period for any LIBOR Loan shall commence on the
Advance Date or date of renewal with respect to such LIBOR Loan;
(ii) if any Interest Period in respect of a LIBOR Loan would
otherwise expire on a day which is not a Business Day, such Interest Period
shall expire on the next succeeding Business Day;
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(iii) any Interest Period in respect of a LIBOR Loan which begins
on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall, subject to clauses (ii) above and (iv) below,
end on the last Business Day of a calendar month;
(iv) no Interest Period for any LIBOR Loan shall extend beyond
the Conversion Date;
(v) there shall be no more than five (5) different Interest
Periods outstanding at any one time; and
(vi) if fail to request an Interest Period with respect to a
LIBOR Loan pursuant to Section 3.2(b), the Borrowers shall be deemed to
have selected an Interest Period of one (1) month for such LIBOR Loan.
"Initial Production Borrowing Base" has the meaning specified in Section
4.1(a).
"Interest Period/Conversion Notice" means a notice from the Borrowers to
the Bank regarding the Borrowers, election concerning an Interest Period for a
LIBOR Loan to take effect on the completion of a current Interest Period, or
regarding the conversion of a Prime Rate Loan to a LIBOR Loan, or vice versa, in
the form of Exhibit D hereto.
"Interest Rate" means the rates of interest payable by the Borrowers on the
Principal Amount of Loans from time to time, which shall be the LIBOR Loan
Interest Rate or the Prime Rate Loan Interest Rate, as applicable to various
portions of the Loans, or the Default Interest Rate.
"Letter of Credit" means a standby letter of credit issued by the Bank
hereunder at the request of the Borrowers and for the account of the Borrowers
in accordance with Section 2.3.
"Letter of Credit Fee" means the fee payable by the Borrowers to the Bank
pursuant to Section 3.1(c).
"LIBOR Loan" means a Facility A Loan for which interest is calculated at
the LIBOR Loan Interest Rate.
"LIBOR Loan Interest Rate" means, with respect to an Interest Period
pertaining to a LIBOR Loan prior to the Conversion Date, an interest rate per
annum equal to the sum of (y) the LIBOR Rate in effect on the first day of the
Interest Period, plus (z) two percent (2%).
"LIBOR Rate" means, relative to an Interest Period pertaining to a LIBOR
Loan, the London Interbank Offered Rate (rounded upwards if necessary to the
nearest whole one-sixteenth of one percent (1/16 of 1%)) as quoted in the Wall
Street Journal two (2) Business Days prior to the beginning of such Interest
Period, for a loan amount
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approximately equal to the Principal Amount of such LIBOR Loan, for a period
approximately equal to such Interest Period and as adjusted for reserve
requirements and other charges that may be imposed on the Bank.
"Loan" means (i) the funds Advanced to the Borrowers by the Bank hereunder
as Facility A Loans and Facility B Loans; (ii) the Term Loan; and (iii) Draws,
as evidenced by the Notes.
"Loan Documents" mean this Agreement, the Notes, the Request for Credit,
the Interest Period/Conversion Notice, the Collateral Documents and any other
documents executed by the Borrowers and delivered to the Bank pursuant hereto.
"Materially Adverse Effect" means, with respect to the Borrowers, an
effect, resulting from any occurrence or state of affairs of whatever nature
(including any adverse determination in any litigation, arbitration or
governmental investigation or proceeding), which the Bank, in its sole
discretion, reasonably exercised, determines is materially adverse to the
ability of the Borrowers to repay the Loans or perform any other material
obligation required under this Agreement or any of the Loan Documents.
"Maximum Credit Amount" means (i) for Facility A Twenty Million Dollars
($20,000,000) and (ii) for Facility B one Million Dollars ($1,000,000), or, in
either case, such lesser amounts elected by the Borrowers pursuant to Section
2.6.
"Mortgaged Properties" mean the interests of the Borrowers in the xxxxx and
production units therefor identified in the Collateral Documents.
"Net Revenue" means an amount determined by subtracting from Gross Revenue
for a given period the sum of (x) all Operating Expenses for such period, plus
(y) all production, severance, real property, ad valorem and other production-
related taxes (but not taxes based upon the income of the Borrowers) for such
period, plus (z) any Operating Expenses and production, severance real property,
ad valorem and other production-related taxes relating to previous periods which
have not already been included in the calculation of Net Revenue for a previous
period.
"Notes" mean the Facility A Note, the Facility B Note and the Term Note,
which Notes evidence the Loans.
"Omnibus Certificate" means the certificate from each of the Borrowers, in
substantially the form of Exhibit G hereto.
"Operating Expenses" means all reasonable and necessary expenses incurred
by the Borrowers in connection with the operation and maintenance of the
Mortgaged Properties (excluding expenses which are capitalized by the Borrowers
for federal income tax purposes unless approved in writing by the Bank for
inclusion as Operating Expenses), together with all gathering, processing,
transportation and marketing charges not already deducted from the gross sales
prices used to determine Gross Revenue.
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"Opinion of Borrowers' Counsel" means the form of opinion of Xxxxxxx
Xxxxxxxx Xxxx & Xxxxxx, P.C., counsel for the Borrowers, in the form of Exhibit
E hereto.
"Party" means one or more of the Borrowers and the Bank, and their
permitted successors and assigns.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture or other entity, or a foreign state or political subdivision thereof or
any agency of such state or subdivision.
"Plan" means an employee benefit or other plan, including a multi-employer
plan, which is covered by Title IV of ERISA.
"Prime Rate" means an index rate which the Bank establishes and quotes from
time to time for pricing certain of its loans. Information on the index rate
currently in effect is announced publicly and can be obtained by contacting the
Bank. The Bank's Prime Rate is not necessarily the best rate charged to Bank
customers and the Bank may make loans at, above, or below this stated index
rate. Changes in the index are effective without notice to the Borrowers.
"Prime Rate Loan" means Loans for which the Prime Rate Loan Interest Rate
is applicable.
"Prime Rate Loan Interest Rate" means an interest rate per annum pertaining
to a Prime Rate Loan. With respect to Facility A Loans, the Prime Rate Loan
Interest Rate is the Prime Rate in effect from time to time. With respect to
Facility B Loans, the Prime Rate Loan Interest Rate is equal to (i) the Prime
Rate in effect from time to time plus (ii) one percent.
"Principal Amount" means the principal amount of Loans outstanding
hereunder from time to time.
"Production Borrowing Base" has the meaning specified in Sections 4.1 and
4.2.
"Quarter" means each three-month period ending each March 31, June 30,
September 30 and December 31 during the term hereof.
"Request for Credit" means a request by the Borrowers for an Advance of a
Facility A Loan, or for an Advance of a Facility B Loan, or for the issuance of
a Letter of Credit under Facility A or Facility B, in the form of Exhibit B
hereto.
"Revolving Loans" mean the funds Advanced to the Borrowers by the Bank
hereunder (i) as Facility A Loans and Draws prior to the Conversion Date and
(ii) as Facility B Loans and Draws during the Revolving Period. The Borrowers
may borrow, repay and reborrow funds which are Advanced as Revolving Loans.
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"Revolving Notes" mean the Facility A Note and the Facility B Note.
"Revolving Period" means the periods during which the Bank will Advance
Revolving Loans hereunder being (i) for Facility A the period commencing on the
Closing Date and ending on the Conversion Date and (ii) for Facility B the
period commencing on the Closing Date and ending on the Facility B Maturity
Date.
"Security Opinion" means the legal opinion or legal opinions substantially
in the form of Exhibit F hereto, which will be delivered by the Borrowers
pursuant to Section 6.3.
"Term Loan" means the Principal Amount of the Facility A Loans on the
Conversion Date, which are evidenced by the Term Note.
"Term Note" means the promissory note in the form of Exhibit A-3 hereto,
which evidences the Term Loan.
"Unmatured Event of Default" means any facts, condition or state of affairs
which, with the passage of time, shall constitute an Event of Default.
"Year" means the fiscal year of the Borrowers.
Section 1.2 Computation of Time Periods. In this Agreement, in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding."
Section 1.3 Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
financial statements referred to in Section 7.1(f).
ARTICLE II
THE CREDIT
Section 2.1 The Advances. The Bank agrees, subject to the terms and
conditions of this Agreement, during the Revolving Period to Advance Loans to
the Borrowers in multiple Advances as Revolving Loans and to issue Letters of
Credit for the account of the Borrowers; provided, however, (a) that the
aggregate Principal Amount of all Facility A Loans and Face Amount of all
Letters of Credit issued under Facility A at no time exceeds the lesser of the
Maximum Credit Amount for Facility A and the Production Borrowing Base and (b)
that the aggregate Principal Amount of all Facility B Loans and Face Amount of
all Letters of Credit issued under Facility B at no time exceeds the lesser of
the Maximum Credit Amount for Facility B and the A/R Borrowing Base.
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Section 2.2 Loans. Each Advance of a Loan under Facility A shall be in
the minimum Principal Amount of $100,000. Each Advance of a Loan under Facility
B shall be in the minimum Principal Amount of $10,000. Subject to all terms and
conditions of this Agreement, the Borrowers may borrow, repay and, during the
Revolving Period, reborrow funds which are Advanced as Revolving Loans;
provided, however, that the Borrowers shall be liable for any Breakage Costs
incurred by the Bank in connection with the Borrowers' repayment of a LIBOR Loan
on any date other than the end of an Interest Period.
Section 2.3 Letters of Credit. Each Letter of Credit issued by the Bank
shall be a standby Letter of Credit, in form reasonably satisfactory to the Bank
and shall be in the minimum amount of $1,000. Each Letter of Credit issued under
Facility A shall have an expiry date no later than the Conversion Date. Each
Letter of Credit issued under Facility B shall have an expiry date no later than
the Facility B Maturity Date; provided, however, that at the Borrowers' written
request the expiry date of any such Letters of Credit may be extended for up to
six (6) months beyond the Facility B Maturity Date but to no later than October
1, 1995. All Draws under Letters of Credit shall constitute Loans hereunder for
all purposes.
Section 2.4 Credit Utilization Procedures.
(a) Loans and Letters of Credit. Not later than 10:00 a.m. Denver,
Colorado time two (2) Business Days prior to the desired date of an Advance of a
Loan or six (6) Business Days prior to the desired date of the issuance of a
Letter of Credit, the Borrowers shall submit a Request for Credit to the Bank,
in the form of Exhibit B hereto, specifying the manner in which the Borrowers
desire to utilize the credit facilities provided under this Agreement and, in
the case of the issuance of a Letter of Credit, an executed application and
agreement for a standby letter of credit in a form acceptable to the Bank. If
the Request for Credit pertains to an Advance of a Loan, the Bank shall Advance
the Loan at the Borrowers direction either by crediting the applicable
Borrowers' account with the Bank on the desired date of the Advance or by wire
transfer thereof on the desired date of the Advance to the account designated in
the Request for Credit. If the Request for Credit pertains to the issuance of a
Letter of Credit, the Bank will issue the Letter of Credit and will deliver the
Letter of Credit to the beneficiary thereof on the desired date of issuance.
(b) Conversion of Facility A Prime Rate Loans. Subject to the terms
and conditions hereof, at any time no Unmatured Event of Default or Event of
Default is outstanding under Facility A, the Borrowers may elect to convert
outstanding Prime Rate Loans to LIBOR Loans. Any such election shall be effected
by the Borrowers' delivery to the Bank of an Interest Period/Conversion Notice
in the form of Exhibit D hereto, not less than two (2) Business Days prior to
the desired date of the conversion. Unless the Bank notifies the Borrowers that
there is an impediment to any such conversion of which notice is so given by the
Borrowers, the conversion of the Prime Rate Loan referenced in such notice shall
be effective on the date specified in the Interest Period/Conversion Notice.
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Section 2.5 Conditions to Advances/Letters of Credit. Notwithstanding
any other provision of this Agreement, the Bank shall not be required to make
any Advance or to issue any Letter of Credit if the conditions precedent thereto
specified in Article V hereof have not been satisfied.
Section 2.6 Voluntary Termination of the Commitment or Reduction of
Maximum Credit Amounts. At any time, and from time to time, the Borrowers may
elect (a) to terminate entirely either or both of the Facility A Commitment or
the Facility B Commitment, or (b) to reduce the Maximum Credit Amount for either
or both of Facility A and Facility B by notice of any such election to the Bank;
provided, however, that in no event may the Commitment be terminated while any
Loans are outstanding or Letters of Credit are in effect, nor may the Maximum
Credit Amount be reduced to an amount less than the aggregate Principal Amount
of outstanding Loans and Face Amount of outstanding Letters of Credit. Any such
election shall be effective two (2) Business Days after receipt by the Bank of
the Borrowers' election to such effect. Any election to terminate the Commitment
or reduce the Maximum Credit Amount shall be irrevocable.
ARTICLE III
FEES, PROCEDURES AND PAYMENT
Section 3.1 Fees.
(a) Facility Fee . The Borrowers agree to pay the Bank a one-
time, nonrefundable fee (the "Facility Fee") in connection with the
establishment of the Commitment in the amount of one-half of one percent (1/2
of 1%) of the Initial Production Borrowing Base. The Facility Fee is payable by
the Borrowers to the Bank on the Closing Date.
(b) Borrowing Base Commitment Fees. The Borrowers agree to pay
to the Bank a fee (the "Borrowing Base Commitment Fees") under each Facility As
follows. The Borrowing Base Commitment Fees with respect to Facility A shall be
determined and paid quarterly in arrears until the Conversion Date at the rate
of one-quarter of one percent (1/4 of 1%) per annum of the amount by which the
average daily aggregate Principal Amount of Facility A Loans and Face Amount of
Letters of Credit issued under Facility A during the Quarter is less than the
Production Borrowing Base applicable for such Quarter. The Borrowing Base
Commitment Fees with respect to Facility B shall be determined and paid
quarterly in arrears at the rate of one-quarter of one percent (1/4 of 1%) per
annum of the amount by which the average daily aggregate Principal Amount of
Facility B Loans and Face Amount of Letters of Credit issued under Facility B
during the Quarter is less than the Maximum Credit Amount for Facility B. The
Commitment Fees will be payable by the Borrowers promptly after receipt of
quarterly invoices therefor from the Bank.
(c) Letter of Credit Fees. The Borrowers agree to pay a fee (the
"Letter of Credit Fee") with respect to each Letter of Credit issued pursuant
hereto in the amount of one and one-quarter percent (1 1/4%) per annum of the
Face Amount of the
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Letter of Credit or $225, whichever is greater. The Letter of Credit Fee will be
payable concurrently with the issuance of each Letter of Credit and is not
refundable if the Letter of Credit is terminated or released prior to its expiry
date. In addition, the Borrowers agree to pay the usual and customary processing
and issuance fees for Letters of Credit charged by the Bank for issuance of
letters of credit and any amendments thereto.
(d) Facility A Prepayment Fee. If pursuant to Section 2.6, the
Borrowers prepay and terminate Facility A during the first twelve (12) months of
the Revolving Period, the Borrowers agree to pay to the Bank a fee (the
"Facility A Prepayment Fee") equal to one-half of one percent (1/2 of 1%) of
the most recent Production Borrowing Base as determined by the Bank pursuant to
Sections 4.1 and 4.2.
Section 3.2 Interest.
(a) General. The Borrowers shall pay interest on the outstanding
Principal Amount of the Loans at the applicable Interest Rate. Subject to
Section 9.2 pursuant to which the Default Interest Rate may become applicable,
(i) interest on Facility A Loans may be calculated at the Prime Rate Loan
Interest Rate or the LIBOR Loan Interest Rate, as elected by Borrowers or as
otherwise provided herein; and (ii) interest on Facility B Loans and the Term
Loan will be calculated at the Prime Rate Loan Interest Rate. Interest payable
shall be calculated daily. Interest on LIBOR Loans shall be payable on the last
day of each Interest Period. Interest on Prime Rate Loans shall be payable
monthly, in arrears, on the first Business Day of each month with respect to the
preceding month. Interest accruing at the Default Interest Rate shall be payable
on demand.
(b) Interest Periods. The Borrowers will select an Interest Period for
each LIBOR Loan by giving notice to the Bank in the Request for Credit and
thereafter (with respect to outstanding LIBOR Loans to be continued as LIBOR
Loans) by giving notice in an Interest Period/Conversion Notice at least two (2)
Business Days prior to the expiry date of the Interest Period then in effect.
With respect to existing LIBOR Loans, if the Borrowers fail to give timely
notice of an Interest Period selection, then the Borrowers shall be deemed to
have elected to convert the LIBOR Loan to a Prime Rate Loan effective as of the
end of the then current Interest Period for such LIBOR Loan.
Section 3.3 Conversion of Facility A Loans; Amortization of Term Loan.
Upon the occurrence of the Conversion Date, the Borrowers shall have no further
right hereunder to receive Advances under Facility A. The Principal Amount of
the Facility A Loans on the Conversion Date shall automatically become a Term
Loan and will be evidenced by the Term Note in the form of Exhibit A-3 hereto.
Subject to Sections 4.3 and 9.2, the Term Loan will be repaid beginning on May
1, 1996 according to a minimum monthly principal payment schedule to be
determined by the Bank as of the Conversion Date. The minimum monthly principal
payment schedule will provide for repayment of the Term Loan over a period equal
to the lesser of (a) the economic half-life of the Mortgaged Properties as
determined by the Bank as of the Conversion Date in accordance with its normal
parameters for oil and gas production-based loans in effect at
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the time or (b) five (5) years; provided, however, that the Term Loan shall be
paid in full no later than the Facility A Scheduled Maturity Date.
Section 3.4 Payments of Principal During the Revolving Period. During
the Revolving Period, and in addition to any payments of principal required
pursuant to Section 4.3, payments of the Principal Amount of the Revolving Loans
may be made by the Borrowers in whole or in part on any Business Day (a) for
Facility A through and including the Conversion Date and (b) for Facility B
through and including the Facility B Maturity Date; provided, however, in the
event the Bank makes demand for payment under Facility B prior to the Facility B
Maturity Date, the Borrowers shall have the lesser of sixty (60) days or until
the Facility B Maturity Date (i) to repay cash Advances and (ii) to secure
outstanding Letters of Credit with cash collateral. Payments made hereunder
shall be in the minimum amount of $50,000 and shall be without premium or
penalty except as provided otherwise in Section 3.1(d). Payments shall be
accompanied by interest accrued on the amount prepaid through the date of the
payment, plus, in the case of LIBOR Loans, Breakage Costs, if any, for any
prepayment which is not at the end of an Interest Period.
Section 3.5 Prepayment of the Term Loan. During the Amortizing Period,
the Borrowers shall have the right to prepay the Principal Amount of the Term
Loan on any Business Day as provided herein, upon at least two (2) Business
Days' notice to the Bank. Prepayments shall be in the minimum amount of $50,000.
Prepayments shall be without premium or penalty. Prepayments will be applied, at
Borrowers' option, to installment payments of principal due hereunder in inverse
order of or in order of approaching maturity and shall be accompanied by a
payment of accrued interest on the Principal Amount prepaid through the date of
the prepayment.
Section 3.6 Payments and Computations.
(a) The Borrowers shall make each payment hereunder and under the
Notes not later than 12:00 noon (Denver, Colorado time) on the day when due in
lawful money of the United States of America to the Bank at its office at 000
Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx, or at any other location designated by the
Bank.
(b) All computations of interest under the Prime Rate Loans and the
Borrowing Base Commitment Fees set forth in Section 3.1(b) shall be made by the
Bank on the basis of a year of 365 days for the actual number of days (including
the first day but excluding the last day) occurring in the period for which such
interest or Borrowing Base Commitment Fees is payable. All computations of
interest under the LIBOR Loans shall be made by the Bank on the basis of a year
of 360 days for the actual number of days (including the first day but excluding
the last day) occurring in the Interest Period.
Whenever any payment to be made hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of interest or the Borrowing Base Commitment
Fees, as the case may be.
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Section 3.7 Evidence of Debt.
(a) Prior to the Conversion Date the indebtedness of the Borrowers
resulting from all Advances made from time to time under Facility A or Draws
under Letters of Credit issued under Facility A shall be evidenced by the
Facility A Note of the Borrowers delivered to the Bank pursuant to Article V. On
and after the Conversion Date, the total indebtedness of the Borrowers under
Facility A which has not been repaid as of the Conversion Date shall be
evidenced by the Term Note of the Borrowers delivered to the Bank pursuant to
Article V.
(b) Prior to the Facility B Maturity Date the indebtedness of the
Borrowers resulting from all Advances made from time to time under Facility B or
Draws under Letters of Credit issued under Facility B shall be evidenced by the
Facility B Note of the Borrowers delivered to the Bank pursuant to Article V.
Section 3.8 Use of Proceeds. All Advances shall be used by the Borrowers
exclusively in the following manner:
(a) Facility A. Proceeds drawn under the Facility A Commitment shall
be used by the Borrowers:
(i) For cash advances to repay all amounts owing by BFC to
Chase pursuant to the Chase Loan.
(ii) For cash advances to be used by the Borrowers in
operations in the ordinary course of business, including without limitation
(A) for working capital, (B) for capital expenditures relating to
acquisition, exploration and development of oil and gas properties and (C)
to cure an A/R Borrowing Base deficiency or payment default under Facility
B as provided under Section 4.4.
(iii) For cash advances or for the issuance of Letters of Credit
(with expiry dates no later than the Conversion Date) used to meet the
margin requirements of commodity brokers or financial intermediaries in
connection with the Borrowers' commodity price hedging activities.
(b) Facility B. Proceeds drawn under the Facility B Commitment shall
be used solely by BFMC and BFM Corp.:
(i) For the issuance of standby Letters of Credit to support
BFMC's and BFM Corp.'s natural gas marketing activities, including
guaranteeing payment for the purchase and transportation of natural gas.
(ii) For cash advances used by BFMC and BFM Corp. to meet
working capital requirements relating to their natural gas marketing
activities, including the payment of amounts due for natural gas purchases
and transportation services.
15
(iii) For cash advances or for the issuance of standby Letters of
Credit used to meet the margin requirements of commodity brokers or
financial intermediaries in connection with BFMC's and BFM Corp.'s
commodity price hedging activities.
Section 3.9 Inability to Honor Commitment. The Bank shall not be liable
for any failure to comply with its obligations under or pursuant to the
Commitment if and to the extent such failure is caused directly or indirectly,
wholly or partly, by act or omission of any government or other competent
authority beyond the reasonable control of the Bank.
Section 3.10 Increased Costs and Reduction in Return. If due to (a) the
introduction of, or any change (including, without limitation, any change by way
of imposition or increase of reserve requirements) in, or in the interpretation
of, any law or regulation or (b) the compliance by the Bank with any guideline
or request from any central bank or other governmental authority having
jurisdiction over the Bank (whether or not having the force of law) collectively
referred to as "Governmental Acts," there shall be an increase in the cost or
reduction in return to the Bank of agreeing to make or making, funding or
maintaining the Loans, then the Borrowers shall from time to time, upon notice
and demand by the Bank, pay to the Bank additional amounts sufficient to
indemnify it against such increased costs or reduction in return accruing to or
otherwise realized by the Bank commencing on the day which is ninety (90) days
after such notice and demand by the Bank. Such increased costs or reduction in
return shall be determined by the Bank's reasonable allocation of the aggregate
of such increased costs or reduction in return resulting from such Governmental
Acts. A certificate as to the amount of such increased cost or reduced return,
submitted to the Borrowers by the Bank, identifying the increased cost or
reduced return in reasonable detail, shall be conclusive absent manifest error.
ARTICLE IV
BORROWING BASE
Section 4.1 Initial Borrowing Base.
(a) Facility A. During the period from the Closing Date to the date
of the first determination of the Production Borrowing Base pursuant to Section
4.2, the amount of the Production Borrowing Base for Facility A shall be Eight
Million Five Hundred Thousand Dollars ($8,500,000), which is the Initial
Production Borrowing Base.
(b) Facility B. During the period from the Closing Date to the date
of the first determination of the A/R Borrowing Base pursuant to Section 4.4,
the amount of the A/R Borrowing Base for Facility B shall be Dollars
($570,287.00).
16
Section 4.2 Production Borrowing Base Determinations. The Production
Borrowing Base under Facility A shall be redetermined (a) during the Revolving
Period by the Bank as of (i) each April 1, commencing April 1, 1995 (based upon
the Bank's evaluation of annual independent engineering reports to be provided
to the Bank by the Borrowers as more fully described in Section 4.5(a)) and (ii)
each October 1, commencing October 1, 1994 (based upon the Bank's evaluation of
the Borrowers' actual production, revenue and expense data to be provided to the
Bank by the Borrowers as more fully described in Section 4.5(b)) and (b) during
the Amortizing Period by the Bank as of each April 1 (based upon the
aforementioned independent engineering reports) and (c) otherwise may be
redetermined by the Bank from time to time during the term of this Agreement at
the Bank's option and in the sole discretion of the Bank in accordance with the
Bank's standard parameters for making oil and gas production based loans in
effect at the time of such redetermination, together with such adjustments as
the Bank determines to be appropriate, in its sole discretion reasonably
exercised, to reflect the impact on the value of such properties of breaches of
Environmental Laws, if any, by the Borrowers or their predecessors in ownership
of any of the Mortgaged Properties. Any increase in the Production Borrowing
Base from the Initial Production Borrowing Base as contemplated in Section 4.1
shall require prior written approval of the Bank's credit committees which may
be given or withheld in the Bank's sole discretion and, as long as Bonneville
Pacific Corporation is involved as a debtor in a United States Bankruptcy Court
proceeding, any increase in the Production Borrowing Base above Ten Million
Dollars ($10,000,000) shall require prior written approval by the Bankruptcy
Court. The Bank shall notify the Borrowers of each change in the Production
Borrowing Base under Facility A and the amount set forth in such notice shall be
the amount of the Production Borrowing Base for all purposes of this Agreement
until notice of a new Production Borrowing Base is given by the Bank to the
Borrowers; provided, however, that the Borrowers may, by written notice to the
Bank within ten (10) Business Days after the Borrowers receive notice of a
change in the Production Borrowing Base from the Bank, reduce the amount of the
Production Borrowing Base from the amount set forth in the Bank's notice to the
Borrowers to any lesser amount which is equal to or in excess of the aggregate
Principal Amount of Facility A Loans and Face Amount of Letters of Credit issued
under Facility A. Any notice given by the Borrowers to reduce the Production
Borrowing Base, shall be effective ten (10) Business Days following the receipt
of such notice by the Bank, and the amount set forth in such notice shall be the
amount of the Production Borrowing Base for all purposes of this Agreement until
notice of a new Production Borrowing Base is given by the Bank to the Borrowers.
However, if the Production Borrowing Base is reduced by the Borrowers pursuant
to this Section 4.2, the Borrowers may, upon ten (10) Business Days' prior
written notice given to the Bank, increase the Production Borrowing Base up to
the amount originally specified in the Bank's notice to the Borrowers on which
such reduction was based. Such notice of increase must be accompanied by payment
to the Bank of an amount equal to the Borrowing Base Commitment Fees specified
in Section 3.1(b) which would have accrued and been invoiced by the Bank on the
amount of the increase to the date of reinstatement if the amount of such
increase had been included within the Production Borrowing Base at all
17
times from the date of the Bank's notice to the Borrowers. Any such amounts
which are payable by the Borrowers but which would not have been invoiced by the
Bank shall be payable at the next scheduled invoice for Borrowing Base
Commitment Fees.
Section 4.3 Mandatory Action When Facility A Loans And Letters Of Credit
Issued Under Facility A Exceed The Production Borrowing Base. In the event the
aggregate unpaid Principal Amount of the Facility A Loans and Face Amount of the
Letters of Credit issued under Facility A shall, at the time of any
determination of the Production Borrowing Base pursuant to Section 4.2, be in
excess of the Production Borrowing Base, the Bank shall so notify the Borrowers,
and the Borrowers shall within ten (10) Business Days thereof notify the Bank of
the Borrowers' election to implement one or a combination of the following
alternatives to eliminate such excess.
(a) The Borrowers may elect to pay, within thirty (30) days of such
notice, as much of the Facility A Loans and/or replace Letters of Credit as
necessary in order that the aggregate Principal Amount and Face Amount thereof
outstanding shall not exceed the Production Borrowing Base.
(b) The Borrowers may elect to amortize such excess in six (6) equal
monthly installments of principal beginning on the first day of the month
following the date of such notice.
(c) The Borrowers may increase the Production Borrowing Base to an
amount equal to the aggregate unpaid Principal Amount of the Facility A Loans
and Face Amount of the Letters of Credit issued pursuant to Facility A by
presenting, within thirty (30) days after date of such notice, at the Borrowers'
option, (i) an independent engineer's report to the Bank, in form and substance
reasonably satisfactory to the Bank, or (ii) actual production, revenue and
expense data reasonably satisfactory to the Bank, regarding additional producing
oil and gas properties to be subjected to the first lien of the Collateral
Documents, which report or data indicate that the value of such properties will
eliminate the excess of the Facility A Loans and Letters of Credit over the
Production Borrowing Base. The Bank shall determine, in accordance with Section
4.2, whether any such additional properties will increase the Production
Borrowing Base, and the extent of any such increase. The increase in the
Borrowing Base based upon such additional properties shall be effective only
when such properties have been added to the Collateral and the Bank has been
satisfied with respect to the Borrowers' title thereto.
If the Borrowers fail to eliminate such excess of the Facility A Loans and
Letters of Credit over the Production Borrowing Base within such thirty (30) day
period pursuant to subsections (a) or (c) above, or fail to begin amortizing
such excess pursuant to subsection (b) above, the Bank may, at its option,
declare that an Unmatured Event of Default shall have occurred hereunder and the
Bank shall be entitled to exercise its rights under Article IX.
Section 4.4 A/R Borrowing Base Determinations. The A/R Borrowing Base
under Facility B shall be an amount equal to 60% of the Eligible Accounts
Receivable as
18
redetermined by the Bank in the exercise of its sole discretion on the fifteenth
day of each month (an "A/R Borrowing Base Redetermination") based upon BFMC's
and BFM Corp.'s most recent Accounts Receivable Report. The A/R Borrowing Base
will be effective from the date of an A/R Borrowing Base Redetermination until
the date of the next A/R Borrowing Base Redetermination.
"Eligible Accounts Receivable" means those accounts receivable of BFMC and
BFM Corp., for sales made according to usual contract sales terms, which are
less than thirty (30) days old from the date of invoice, together with (i)
accounts from related or affiliated entities to the extent the respective
Borrower has in its possession cash pre-payments or deposits from such entities
and for which such Borrower has the right to offset such prepayments or deposits
for payment of such accounts, and (ii) accounts anticipated to be billed during
the next month for sales made during the current month, and for which the
respective Borrower has made prepayments (or has guaranteed payment through the
Bank's issuance of letters of credit on behalf of such Borrower) for purchases
anticipated to be made and/or transportation services anticipated to be utilized
during the current month. Specifically not included in Eligible Accounts
Receivable are (a) disputed accounts, (b) finance charges, (c) accounts subject
to offset or counterclaim by account debtors, (d) U.S. Government accounts, (e)
foreign accounts, (f) cash-on-delivery (COD) accounts, (g) employee receivables,
(h) receivables from related or affiliated entities for which the respective
Borrower does not have in its possession offsetting pre-payments or deposits, or
(i) any other accounts the Bank, exercising reasonable discretion, deems
ineligible. In addition, account concentrations in excess of fifteen percent
(15%) from an account debtor (excluding accounts due under the American Atlas
Contract) would be limited to an amount equal to fifteen percent (15%) of the
total accounts used to calculate the A/R Borrowing Base, unless specifically
approved for inclusion in the A/R Borrowing Base calculation by the Bank.
Section 4.5 Engineering Reports; Production and Income Projections.
(a) Promptly after each December 31 hereafter, commencing December
31, 1994, occurring prior to the Facility A Maturity Date, and in all events
within sixty (60) days after each such date, the Borrowers shall furnish to the
Bank a report in form and substance reasonably satisfactory to the Bank by an
independent petroleum engineer reasonably acceptable to the Bank concerning the
Mortgaged Properties. Such report shall set forth the estimated proven and
producing and proven and nonproducing oil and gas reserves attributable to all
of the Borrowers, properties, including, but not limited to, the Mortgaged
Properties, and to any additional properties which the Borrowers propose to add
to the Collateral, and shall include a projection of the rate of production
therefrom for the life of such properties. In the event the Borrowers are unable
to provide production data to the Bank in magnetic form compatible with the
Bank's hardware and engineering software (Xxxxxxx'x Aries), the Borrowers agree
to reimburse the Bank for any out-of-pocket expenses relating to obtaining
production data from Dwight's Energy Data Service or a comparable service as
chosen by the Bank in its sole discretion.
19
(b) Promptly after each June 30 hereafter, commencing June 30, 1994,
occurring prior to the Conversion Date, and in all events within sixty (60) days
after each such date, the Borrowers shall furnish to the Bank the Borrowers'
actual monthly production, revenue and expense data in accordance with Section
8.1(b).
ARTICLE V
CONDITIONS OF LENDING
Section 5.1 Conditions Precedent to the Initial Advance. The obligation
of the Bank to make its Initial Advance is subject to the satisfaction of the
following conditions precedent:
(a) The Bank shall have received, on or before the day of the
Advance, the following in form, substance and date satisfactory to the Bank:
(i) this Agreement, executed by the Borrowers;
(ii) the Notes, executed by the Borrowers, dated as of the date
of this Agreement;
(iii) an "Omnibus Certificate" of the Secretary and the
President of each of the Borrowers substantially in the form of Exhibit G
hereto, which shall contain the names and signatures of the officers of the
Borrowers entitled to execute the Loan Documents and to request Advances
and which shall certify the truthfulness, correctness and completeness of
the following attachments thereto: (1) a copy of the articles of
incorporation of each of the Borrowers and all amendments thereto, (2) a
copy of the bylaws of each of the Borrowers, and (3) a copy of the
resolutions duly adopted by the Board of Directors of each of the Borrowers
authorizing the Borrowers to enter into this Agreement, to execute all
documents related hereto and to carry out the transactions contemplated
herein;
(iv) the Collateral Documents, executed by the Borrowers;
(v) a certificate of the due incorporation, valid existence
and good standing of each of the Borrowers in their respective states of
incorporation, issued by the appropriate authorities in such jurisdiction;
(vi) a certificate evidencing each of the Borrowers' good
standing and due qualification as a foreign corporation to do business in
each jurisdiction in which such qualification is necessary, including in
the case of BFC, but not limited to, New Mexico, Texas and Utah, issued by
appropriate authorities in such jurisdictions;
(vii) the Opinion of Borrowers' Counsel in the form of Exhibit
E hereto;
20
(viii) evidence of written approval by the United States
Bankruptcy Court having jurisdiction over the bankruptcy proceedings of
Bonneville Pacific Corporation that Borrowers are authorized to enter into
this Agreement and otherwise in form reasonably satisfactory to the Bank;
(ix) the Chase Transfer Documents, duly executed by Chase;
(x) evidence satisfactory to the Bank of the Borrowers' title
to the Mortgaged Properties subject to the Collateral Documents and to the
other Collateral, which title shall be free and clear of liens,
encumbrances and defects except those in favor of Chase in connection with
the Chase Loan which have been transferred to the Bank and those acceptable
to the Bank in its sole discretion as listed in Schedule 7.1(n); and
(xi) any other documents and instruments that the Bank shall
have reasonably requested, which the Parties anticipate may include (A) an
opinion of legal counsel for Borrowers that the Chase Transfer Documents
when properly executed will vest in the Bank those rights currently owned
by Chase in the Chase Documents and the Mortgaged Property; (B) corporate
documents and records; and (C) certificates of officers and representatives
of Borrowers as to the accuracy and validity of or compliance with all
representations, warranties and covenants made by Borrowers in this
Agreement.
(b) The Bank shall have conducted an examination of and have been
satisfied (in its sole discretion, reasonably exercised) with BFMC's and BFM
Corp.'s gas marketing, accounting and billing systems.
Section 5.2 Conditions Precedent to all Advances. The obligation of the
Bank to make each Advance (including the Initial Advance) shall be subject to
the further conditions precedent that:
(a) the Borrowers shall have performed and complied with all
agreements and conditions herein required to be performed or complied with on or
prior to the date of such Advance;
(b) the Bank shall have received a Request for Credit, duly executed
by the Borrowers;
(c) on the date of such Advance the Bank shall have received such
other approvals, opinions or documents as required under the terms of this
Agreement;
(d) on the date of such Advance the Bank shall have satisfied itself
of the absence of a Materially Adverse Effect;
(e) such Advance shall not cause the aggregate Principal Amount of
the Facility A Loans and the Facility B Loans and Face Amount of issued Letters
of Credit to exceed the Commitment;
21
(f) there shall exist no Unmatured Event of Default or Event of
Default;
(g) all representations and warranties made by the Borrowers shall be
true and correct on the date of such Advance, except for (i) such changes
therein as shall be acceptable to the Bank and (ii) such changes therein as do
not have a Materially Adverse Effect on the Borrowers; and
(h) all governmental requirements and all material approvals and
consents (including, without limitation, all material approvals and consents
required in connection with any Environmental Laws) of Governmental Authorities
or other Persons, if any, required in connection with the operation of the
Collateral, shall have been complied with or obtained and remain in effect.
ARTICLE VI
SECURITY
Section 6.1 Security. Payment of the Notes and all other obligations of
the Borrowers hereunder shall be secured by liens on and security interests in
the Collateral pursuant to the Collateral Documents. The Bank will record or
file the Collateral Documents at the Borrowers' expense promptly after execution
and delivery thereof.
Section 6.2 Perfection and Protection of Security Interests and Liens.
The Borrowers will cause to be delivered to the Bank from time to time as
determined to be necessary or desirable by the Bank any mortgages, deeds of
trust, financing statements, continuation statements, extension agreements and
other documents, properly completed and executed (and acknowledged when
required) by the Borrowers, in form and substance satisfactory to the Bank for
the purpose of perfecting or protecting the Bank's liens, pledges, security
interests and assignments in and of the Collateral.
Section 6.3 Security-Opinions. Not more than one hundred twenty (120)
days after the Closing Date, the Borrowers shall furnish to the Bank an opinion
or opinions (the "Security opinion") from Borrowers' counsel, in form of Exhibit
F hereto, confirming that the nature and extent of the Borrowers' title to the
portion of the Mortgaged Properties identified in Schedule 6.3 hereto (with such
opinions expressly to include the Borrowers, working and net revenue interests
therein) conform to the assumptions used by the Bank in determining the
Production Borrowing Base and confirming that the Collateral Documents have duly
created and perfected a first enforceable lien thereon in favor of the Bank. In
addition, from time to time during the term hereof, the Borrowers will deliver
such additional opinions regarding the Mortgaged Properties, from Borrowers'
counsel and in form and content reasonably satisfactory to the Bank, as the Bank
may reasonably request with respect to (i) actual or potential material defects
in the Borrowers' title to a particular Mortgaged Property or, (ii) additional
producing oil and gas properties included in the Production Borrowing Base.
22
Section 6.4 Banker's Lien; Offset. The Borrowers hereby confirm the
Bank's banker's lien and grant to the Bank a right of offset to secure the
payment of the Borrowers' obligations hereunder to the Bank, which right of
offset shall be upon any and all monies, securities or other property (and the
proceeds therefrom) of the Borrowers, now or hereafter held or received by or in
transit to the Bank from or for the account of the Borrowers, whether for
safekeeping, custody, pledge, transmission, collection or otherwise, and also
upon any and all deposits (general or special), credits and claims of the
Borrowers, at any time existing against the Bank. Upon the occurrence of any
Event of Default, the Bank is authorized at any time and from time to time,
without notice to the Borrowers, to offset, appropriate, and apply any and all
items hereinabove referred to against the Borrowers' obligations to the Bank
under the Loan Documents.
Section 6.5 Deposit Accounts. The Bank reserves the right to require, at
the Bank's sole discretion, the Borrowers to maintain deposit account(s) with
the Bank for the deposit of (a) production proceeds from the Mortgaged
Properties and (b) proceeds from BFMC's and BFM Corp.'s accounts and contracts.
The Bank agrees that such accounts will be interest-bearing to the extent the
Bank is reasonably able to do so.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
Section 7.1 Representations and Warranties of the Borrowers. The
Borrowers represent and warrant as follows:
(a) Existence; Standing. BFC is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of Colorado.
BFM Corp., BFOC, BFMC and CGC are each corporations duly incorporated, validly
existing, and in good standing under the laws of the State of Utah.
(b) Qualification to Do Business. Each Borrower is in good standing
and duly qualified as a foreign corporation to do business in each jurisdiction
in which such qualification is necessary and in which a failure to so qualify
would have a Materially Adverse Effect on its business.
(c) Due Authorization. The execution, delivery and performance by
the Borrowers of this Agreement, the Notes and the Collateral Documents are
within each of the Borrowers, corporate powers, have been duly authorized by all
necessary corporate action by each of the Borrowers, and do not contravene.
(i) the Borrowers' organizational documents, charter or bylaws
or
(ii) any law or any contractual restriction binding on or
affecting the Borrowers.
23
(d) Approvals. Except as provided in Schedule 7.1(d), no
authorization, approval or other action by, and no notice to or filing with, any
Governmental Authority or regulatory body is required for the due execution,
delivery and performance by the Borrowers of the Loan Documents.
(e) Binding Obligations. This Agreement is, and the Notes and the
Collateral Documents and all other Loan Documents when executed and delivered
hereunder will be, legal, valid and binding obligations of the Borrowers,
enforceable against the Borrowers in accordance with their respective terms,
except (i) that such enforcement may be subject to bankruptcy, insolvency,
moratorium or similar laws affecting creditors, rights and (ii) that the remedy
of specific performance and injunctive and other forms of equitable relief are
subject to certain equitable defenses and to the discretion of the court before
which any proceedings therefor may be brought.
(f) Financial Statements. The balance sheets of the Borrowers, dated
as of December 31, 1993, and the related statements of income and retained
earnings of the Borrowers for the Year then ended, copies of which have been
furnished to the Bank, fairly present the financial condition of the Borrowers
as at such date and the results of the operations of the Borrowers for the
period ended on such date, all in accordance with generally accepted accounting
principles consistently applied, and since such date there has been no material
adverse change in such condition or operations which has not been disclosed to
the Bank in writing.
(g) Use of Proceeds. (i) No proceeds of any Advance will be used to
acquire any security in any transaction which is subject to Sections 13 and 14
of the Securities Exchange Act of 1934 and (ii) no proceeds will be used to make
loans or advances to, dividends to, stock purchase from, or payments against
advances from BPC.
(h) Regulation U. The Borrowers are not engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U issued by the Board of Governors of the Federal
Reserve System), and no proceeds of any Advance will be used to purchase or
carry any margin stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock.
(i) Investment Company Act. The Borrowers are not, and the Borrowers
are not directly or indirectly controlled by, or acting on behalf of any Person
which is, an "investment company" within the meaning of the Investment Company
Act of 1940, as amended.
(j) Other Obligations. Except as shown in Schedule 7.1(j), the
Borrowers have no outstanding indebtedness, obligations, liabilities (including
contingent, indirect and secondary liabilities and obligations), tax assessments
or unusual forward or long-term commitments, with respect to the Mortgaged
Properties which are, in the aggregate, material (defined as being in excess of
$100,000.00) with respect to the financial condition of the Borrowers, and in
either case, not shown in the financial
24
statements referred to in Section 7.1(f) or in any other writings heretofore
delivered by the Borrowers to the Bank.
(k) Full Disclosure. No certificate, statement or other information
delivered herewith or heretofore by the Borrowers to the Bank in connection with
the negotiation of this Agreement or in connection with any transaction
contemplated hereby contains any untrue statement of a material fact or omits to
state any material fact known to the Borrowers necessary to make the statements
contained herein or therein not misleading as of the date presented. There is no
fact known to the Borrowers that the Borrowers have not disclosed to the Bank in
writing which could materially and adversely affect the properties, business,
prospects or condition (financial or otherwise) of the Borrowers.
(l) No Litigation. Except as identified in Schedule 7.1(l) hereto,
there are no actions, suits or legal, equitable, arbitrative or administrative
proceedings pending or, to the knowledge of the Borrowers, threatened against
the Borrowers at law or in equity or before any federal, state, municipal or
other governmental department, commission, body, board, bureau, agency, or
instrumentality, domestic or foreign, and there are no outstanding judgments,
injunctions, writs, rulings or orders by any court or governmental body against
the Borrowers, any of the Borrowers' stockholders, directors or officers, which
relate to the Collateral, or, with respect to their Borrowers generally, which
do or may materially and adversely (defined as being in excess of $500,000 in
the aggregate) affect the Borrowers, their ownership or use of any of their
assets or properties, their businesses or financial conditions or prospects, or
the right or ability of the Borrowers to enter into this Agreement or to
consummate the transactions contemplated hereby or to perform their obligations
hereunder.
(m) No ERISA Liability. The Borrowers have no knowledge of the
occurrence of any event with respect to any ERISA Plan which could result in a
liability of the Borrowers to the Pension Benefit Guaranty Corporation, other
than the payment of premiums (but no late payment charge) pursuant to Section
4007 of ERISA.
(n) Title to Mortgaged Properties. BFC and BFOC have good and
defensible title to the interests in oil and gas xxxxx and other interests which
comprise the Mortgaged Properties, and BFMC and BFM Corp. have good title to
their accounts receivable, in each case free and clear of all liens,
encumbrances, options, charges and assessments other than those identified in
Schedule 7.1(n) and in Section 8.1(q) hereto, or as otherwise disclosed to the
Bank in writing prior to the execution hereof by the Borrowers.
(o) Existing Subsidiaries. The Borrowers have no existing
subsidiaries, except that BFMC, CGC, BFOC and BFM Corp. are subsidiaries of BFC.
(p) Drilling and Operations. To the best of the Borrowers'
knowledge, the oil and gas xxxxx identified in the Collateral Documents have
been drilled and operated in all material respects in accordance with the terms
of relevant leases and
25
agreements and applicable federal, state and local laws and regulations and are
bottomed on and producing from the drilling and spacing units or blocks
therefor.
(q) Qualification to Hold Federal Oil and Gas Leases. The Borrowers
are duly qualified to hold interests in oil and gas leases issued by the United
States pursuant to the 1920 Mineral Leasing Act.
(r) Environmental. Except as indicated in Schedule 7.1(r), the
Mortgaged Properties are, and at all times have been, operated by the Borrowers,
and to the knowledge of Borrowers, by the Borrowers' predecessors in interest,
in material compliance with all Environmental Laws then applicable; and no
conditions exist which are due to ownership and operation by the Borrowers, or
to the knowledge of Borrowers, which are due to ownership and operation by
Borrowers, predecessors in interest that would subject the Borrowers or the Bank
to any damages (including without limitation actual, consequential, exemplary
and punitive damages), penalties, injunctive relief or cleanup costs under any
Environmental Law, or that require or are likely to require cleanup, removal,
remedial action or other response by the Borrowers or the Bank pursuant to
Environmental Laws. The Borrowers are not a party to any pending or threatened
litigation or administrative proceeding that asserts or alleges that the
Borrowers or their predecessors violated or are violating Environmental Laws or
that the Borrowers or their predecessors are required to clean up, remove or
take remedial or other responsive action due to the use, storage, treatment,
disposal, discharge, leaking or release of any Hazardous Materials. Neither the
Borrowers, nor to the Borrowers' knowledge their predecessors, nor any part of
the Mortgaged Properties is subject to any judgment, decree, order or citation
related to or arising out of Environmental Laws, and the Borrowers have not been
named or listed as a potentially responsible party by any governmental or other
entity in a matter arising under or relating to any Environmental Law. The
Borrowers and, to the Borrowers' knowledge their predecessors, have obtained all
permits, licenses and approvals required under Environmental Laws. There are not
now, nor have there ever been materials discharged, leaked, spilled or released,
under or at the surface, or stored, treated or recycled at or in tanks or other
facilities thereon or related thereto which require cleanup, removal or some
other remedial action under Environmental Laws which arise from the Borrowers'
ownership and operations, or to the Borrowers' knowledge which arise from
ownership or operations of the Borrowers' predecessors in interest. The
Borrowers undertook, at the time of acquisition of the Mortgaged Properties, all
appropriate inquiry into the previous ownership and uses of the Mortgaged
Properties consistent with good commercial and industry practice. The Borrowers
have taken all reasonable steps necessary to determine that (i) no Hazardous
Materials have been used or stored on, in or in connection with the Mortgaged
Properties, or disposed from the Mortgaged Properties, except in full compliance
with all Environmental Laws then applicable, and (ii) no Hazardous Materials
have been treated, processed, discharged or released on, in, to or from the
Mortgaged Properties except in full
26
compliance with all Environmental Laws then applicable. The use which the
Borrowers make and intend to make of the Mortgaged Properties will not
result in (x) the use or storage of any Hazardous Materials on, in or in
connection with the Mortgaged Properties, or disposal from the Mortgaged
Properties, except in full compliance with all Environmental Laws then
applicable, or (y) the treatment, processing, discharge or release of any
Hazardous Materials on, in, to or from the Mortgaged Properties. Operation
and closure of underground storage tanks on the Mortgaged Properties shall
be in compliance with Environmental Laws. To the Borrowers' knowledge
there are no underground storage tanks located on or in the Mortgaged
Properties.
As used in this Section 7.1(r) and in the definition of Environmental Laws,
the term "release" shall have the meaning specified in CERCLA, and the term
"disposal" or "disposed" shall have the meaning specified in RCRA. In the event
CERCLA, RCRA or any other applicable Environmental Law is amended so as to
broaden the meaning of any terms defined thereby, such broader meaning shall
apply subsequent to the effective date of such amendment; and to the extent that
the laws of any state in which the Mortgaged Properties are located establish a
meaning for "hazardous substance," "release," "solid waste," "hazardous waste,"
"disposal" or "disposed" that is broader than that specified in either CERCLA or
RCRA, such broader meaning shall apply.
ARTICLE VIII
COVENANTS OF THE BORROWERS
Section 8.1 Affirmative Covenants. So long as the Notes or any other
amounts due the Bank hereunder shall remain unpaid or any Letter of Credit
remains outstanding or the Bank shall have any Commitment hereunder, the
Borrowers will, unless the Bank shall otherwise consent in writing:
(a) Payment and Performance. Pay all amounts due under the Loan
Documents in accordance with the terms thereof and observe, perform and comply
with every covenant, term and condition therein expressed or implied.
(b) Books, Financial Statements and Reports. Maintain a standard
system of accounting in accordance with generally accepted accounting
principles, consistently applied, and furnish to the Bank the following
statements and reports at the Borrowers' expense:
(i) As soon as available, and in any event within ninety (90)
days after the end of each Year, complete financial reports for the
Borrowers, together with all notes thereto, prepared in reasonable detail,
together with an opinion by an independent certified public accountant
selected by the Borrowers and reasonably acceptable to the Bank, that such
reports have been so prepared. These reports shall contain balance sheets
as of the end of such Year and statements of earnings, of cash flows, of
changes in financial position, and of changes in stockholders, equity for
such Year, setting forth in comparative form the corresponding figures for
the preceding Year. Such reports shall be accompanied by a certificate
signed by the President or Controller of the Borrowers which confirms (A)
that there existed no condition or event at the end of such Year or at the
time of the auditor's report which constituted an
27
Unmatured Event of Default, or, if any such condition or event existed,
specifying the nature and period of existence of any such condition or
event, (B) the authenticity of the financial statements and (c) the
calculations of and compliance with the financial covenants as described in
Section 8.1(e).
(ii) Within sixty (60) days after the end of each Quarter
except the last Quarter of each Year, a copy of an unaudited consolidated
and consolidating financial statement of the Borrowers prepared in
accordance with generally accepted accounting principles (with such
variations as the Bank may approve in writing), signed by a proper
accounting officer of the Borrowers and consisting of at least a balance
sheet as at the close of such Quarter, and statements of earnings, of cash
flows, changes in financial position and changes in stockholders, equity
for such Quarter and for the period from the beginning of the Year to the
close of such Quarter. Such reports shall be accompanied by a certificate
signed by the President or Controller of the Borrowers which confirms (A)
that there existed no condition or event at the end of such Quarter or at
the time of the auditor's report which constituted an Unmatured Event of
Default, or, if any such condition or event existed, specifying the nature
and period of existence of any such condition or event, (B) the
authenticity of the financial statements and (C) the calculations of and
compliance with the financial covenants as described in Section 8.1(e).
(iii) Within seventy-five (75) days after the end of each
Quarter, commencing June 30, 1994, a production revenue and expense data
report for such Quarter on a month-by-month and property-by-property basis
for all oil and gas properties and interests owned by the Borrowers,
indicating amounts and types of production sold, the unit sales price, and
the gross and net proceeds of such sales and operating expenses, in a form
consistent with Borrowers' lease operating statements previously provided
to the Bank.
(iv) Within thirty (30) days after the filing thereof, copies
of the annual federal income tax returns of the Borrowers other than BFC to
the extent not consolidated in the returns of BFC.
(v) Within sixty (60) days after the end of each Year,
commencing December 31, 1994, a copy of the independent engineering report
described in Section 4.5(a) and, within sixty (60) days after each June 30,
commencing June 30, 1994, the production, revenue and expense data
described in Section 4.5(b).
(vi) Promptly upon their becoming available and at the request
of the Bank, copies of all financial statements, reports, notices and proxy
statements sent by the Borrowers to their stockholders and all registration
statements, periodic reports and other statements and schedules filed by
the Borrowers with any securities exchange, the Securities and Exchange
Commission or any similar Governmental Authority.
28
(vii) Within fifteen (15) days after the end of each month,
commencing on July 15, 1994, an Accounts Receivable Report.
(viii) Promptly upon receipt, notice of material violations by
the Borrowers of any Environmental Laws.
(c) Other Information and Inspections. Furnish to the Bank any
information which the Bank may from time to time reasonably request concerning
the Mortgaged Properties or other Collateral, or any covenant, provision or
condition of the Loan Documents or any matter in connection with the business,
operations or financial condition of the Borrowers. In addition, the Borrowers
will permit representatives appointed by the Bank, including independent
accountants, agents, attorneys, appraisers and any other Persons, upon prior
notice, to visit and inspect during normal business hours any of the Borrowers'
properties, including books of account, other books and records, and any
facilities or other business assets, and to make copies therefrom, photocopies
and photographs thereof, and to write down and record any information such
representatives obtain. The Borrowers shall permit the Bank or its
representatives to investigate and verify the accuracy of the information
furnished to the Bank under or in connection with the Loan Documents and to
discuss all such matters with the Borrowers, officers, employees and
representatives.
(d) Notice of Material Events. Promptly notify the Bank (i) of any
material adverse change in the financial condition of the Borrowers, or any
subsidiary of the Borrowers; (ii) of the occurrence of an Unmatured Event of
Default hereunder; (iii) of the occurrence of any acceleration of the maturity
of any indebtedness owed by the Borrowers, or of any default under any
indenture, mortgage, agreement, contract or other instrument to which the
Borrowers are a party or by which they are bound, if such acceleration or
default might have a material adverse claim (which shall include, without
limitation, any claim of $500,000 or more) asserted against the Borrowers or
with respect to any of their respective properties; (iv) of the occurrence of a
Reportable Event (as such term is defined in Title IV of ERISA) with respect to
any ERISA Plan; and (v) of the filing of any suit or proceeding against the
Borrowers in which an adverse decision could have a material adverse effect upon
their respective financial condition, business or operations. Without
limitation, any suit involving a claim of $500,000 or more against the Borrowers
(which is not covered by effective insurance) shall be considered a suit or
proceeding in which an adverse decision could have a material adverse effect
upon the financial condition of the Borrowers. The Borrowers will also notify
the Bank in writing at least thirty (30) Business Days prior to the date that
any of the Borrowers changes its name or the location of its chief executive
office or principal place of business or the place where it keeps its books and
records concerning the Collateral. The Borrowers hereby advise the Bank that the
address of their chief executive office and principal place of business is 0000
Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000.
29
(e) Financial Covenants. Comply, on a consolidated basis, as of the
end of each Quarter, beginning June 30, 1994 with the following financial tests,
all determined in accordance with generally accepted accounting principles:
During The During The
Revolving Amortizing
Period Period
---------- ------------
Minimum working Capital (1): $ 500,000 $ 500,000
Minimum Current Ratio (1): 1.25x 1.25x
Minimum Net Worth (2): $5,600,000 $ 7,000,000
Minimum Net Worth (3): $9,200,000 $10,600,000
Maximum Debt/Worth (2) 2.5x 2.0x
Maximum Debt/Worth (3) 1.25x 1.0x
Min. Fixed Charge Cover. (4): 1.00x 1.00x
(1) With the current portion of Facility A treated as a non-current
liability.
(2) With advances from BPC ($3.6 million currently) treated as
liability.
(3) With advances from BPC ($3.6 million currently) treated as equity.
(4) (i) Net income after tax plus interest expense plus depreciation,
depletion and amortization, plus other non-cash charges, divided
by
(ii) interest expenses plus required principal payments,
calculated on a fiscal year-to-date basis.
(f) Maintenance of Existence and Qualifications. Maintain and
preserve each of the Borrowers' corporate existence and the Borrowers' rights
and franchises which pertain to the Collateral in full force and effect and
cause the Borrowers to qualify to do business as a foreign corporation in all
states or jurisdictions in which their properties, including the Mortgaged
Properties, are located as required by the laws of each such jurisdiction.
(g) Maintenance of Properties. Preserve, operate and maintain, or
cause to be preserved, operated and maintained, their respective properties,
including the Mortgaged Properties, in a good and workmanlike manner as a
prudent operator in accordance with good oil and gas industry practices. The
Borrowers will maintain, preserve, protect and keep all property used or useful
in the conduct of the Borrowers' business in good condition and in compliance
with all applicable laws, rules and regulations, and will from time to time make
all repairs, renewals and replacements needed to enable the business and
operations carried on in connection therewith to be promptly and advantageously
conducted at all times. The Borrowers will cause the Mortgaged Properties and
the other properties and interests included in the Collateral to be kept free
and clear of liens, charges, security interests, encumbrances, adverse claims
and title defects of every character other than (i) the lien and security
interest created by
30
the Collateral Documents; (ii) taxes constituting a lien but not due and
payable; (iii) defects or irregularities in title which are not such as to
interfere materially with the development, operation or value of the Mortgaged
Properties and not such as to materially affect title thereto; (iv) obligations
under the leases that comprise the Mortgaged Properties; (v) those set forth or
referred to in the Collateral Documents; (vi) those being contested in good
faith by the Borrowers and which do not, in the judgment of the Bank, jeopardize
the Bank's rights in and to the Mortgaged Properties; and (vii) those consented
to in writing by the Bank.
(h) Payment of Taxes, Etc. File or cause to be filed all required tax
returns and pay or cause to be paid all taxes and other governmental charges or
levies imposed upon the Borrowers or upon the Borrowers' income, profits or
property before the same shall become in default, and will pay or cause to be
paid all lawful claims for labor, materials and supplies which, if unpaid, might
become a lien or charge upon the Borrowers' property or any part thereof, and
pay and discharge when due all material debts, accounts, liabilities and charges
now or hereafter owed by them, and maintain appropriate accruals and reserves
for all such liabilities in a timely fashion in accordance with generally
accepted accounting principles; provided, however, that the Borrowers may delay
paying or discharging any such taxes, charges, claims or liabilities so long as
the validity thereof is contested in good faith by appropriate proceedings and
they have set aside on their books adequate reserves therefor.
(i) Insurance. Keep or cause to be kept, with financially sound and
reputable insurers, insurance reasonably acceptable to the Bank against the
Borrowers, liability on account of damages to persons or property.
(j) Books and Records. Maintain at all times complete and accurate
books of account and records.
(k) Payment of Expenses. Regardless of whether or not the
transactions contemplated by this Agreement are consummated, pay all reasonable
costs and expenses of the Bank (including, without limitation as to type of
expense, reasonable attorneys, fees) in connection with (i) the preparation,
execution and delivery of the Loan Documents and any and all amendments,
modifications, supplements, consents, waivers or other documents or instruments
relating thereto; (ii) the filing, recording, refiling and rerecording of any
Collateral Documents and all amendments, supplements or modifications thereto,
and any and all other documents or instruments or further assurances required to
be filed or recorded or refiled or rerecorded by the terms hereof or of any
Collateral Document; (iii) the evaluation and confirmation of the Borrowers'
title to the Mortgaged Properties as requested by the Bank; (iv) the borrowings
hereunder and other action reasonably required in the administration hereof; and
(v) the enforcement, after the occurrence of an Unmatured Event of Default, of
the Loan Documents.
(l) Performance on the Borrowers' Behalf. If the Borrowers fail to
pay any taxes, insurance or other amounts required to be paid under any Loan
31
Documents, the Bank may pay the same and shall be entitled to immediate
reimbursement by the Borrowers therefor and each amount paid shall
constitute a part of the Borrowers, indebtedness to the Bank, shall be
secured by the Collateral Documents and shall bear interest from the date
such amount is paid by the Bank until the date such amount is repaid to the
Bank at the Prime Rate plus four percent (4%).
(m) Compliance with Agreements and Law. Perform all material
obligations required to be performed by the Borrowers under the terms of each
indenture, mortgage, deed of trust, security agreement, lease, franchise,
agreement, contract or other instrument or obligation relating to the Mortgaged
Properties to which the Borrowers are a party or by which the Borrowers or any
of the Mortgaged Properties are bound, and conduct the Borrowers, business and
affairs in compliance with the laws and regulations applicable thereto.
(n) Evidence of Compliance. Furnish to the Bank at the Borrowers,
expense all evidence which the Bank may from time to time reasonably request, as
to the accuracy and validity of or compliance with all representations,
warranties and covenants made by the Borrowers in the Loan Documents, the
satisfaction of all conditions contained therein, and all other matters
pertaining thereto.
(o) Further Assurances. Do such further acts and execute such
further instruments as the Bank may reasonably determine to be necessary or
desirable to carry out the purposes of this Agreement, and maintain and perfect
the liens and security interests created by the Collateral Documents.
(p) Production Purchasers. Upon written request by the Bank, advise
the Bank of the names and addresses of all purchasers of production from the
Mortgaged Properties.
(q) Environmental Laws.
(i) Comply with all applicable Environmental Laws and obtain and
comply with and maintain any and all licenses, approvals, registrations or
permits required by the Environmental Laws.
(ii) Defend, indemnify and hold harmless the Bank and its
employees, agents, officers and directors, from and against any claims,
demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature known or unknown, contingent or
otherwise, arising out of, or in any way relating to the violation of or
noncompliance with any Environmental Law applicable to the Mortgaged
Properties owned or operated by the Borrowers, or any orders, requirements
or demands of Governmental Authorities related thereto, including, without
limitation, attorneys, and consultant's fees, investigation and laboratory
fees, environmental response and cleanup costs, court costs and litigation
expenses, except to the extent that any of the foregoing arise
32
out of the gross negligence or willful misconduct of the party seeking
indemnification therefor.
(iii) Complete and return to the Bank, at the request of the
Bank in its sole discretion, an environmental questionnaire for each of the
Mortgaged Properties, the form of which shall be specified by the Bank. In
no event will such questionnaire require information beyond that required
in connection with ASTM Standard E 1527 for Phase I Environmental Site
Assessments.
Section 8.2 Negative Covenants. So long as the Notes or any other
amounts due the Bank hereunder shall remain unpaid, any Letter of Credit
remaining outstanding or the Bank shall have any Commitment hereunder, the
Borrowers will not, without the prior written consent of the Bank:
(a) Limitation on Dividends and Distributions. Declare or pay any
dividends on, or make any other distributions in respect of shares of Borrowers'
capital stock to the holders of any class of such capital stock (including BPC),
except (i) dividends to other Borrowers and (ii) with the Bank's prior written
consent, dividends from BFC to its shareholders not exceeding the greater of (A)
ten percent (10%) of its after-tax net income or (B) five percent (5%) of its
net cash flow (defined as after-tax net income plus depreciation, depletion and
amortization, and other non-cash charges).
(b) Limitation on Stock Repurchase. Directly or indirectly make any
capital contributions to or purchase, redeem, acquire or retire any shares of
the capital stock of the Borrowers (whether such interests are now or hereafter
issued, outstanding or created), or cause or permit any reduction or retirement
of the capital stock of the Borrowers.
(c) Limitation on Indebtedness. Create, incur, assume, guarantee,
endorse, become or be liable in any manner with respect to or suffer to exist
any Debt, liability or obligation (including, without limitation, all Debt and
all contingent or secondary, or direct or indirect, debts, liabilities or
obligations whatsoever), including additional advances from BPC, except:
(i) the Borrowers, indebtedness to the Bank hereunder;
(ii) existing Debt identified in Schedule 8.2(c) hereto;
(iii) current debts, obligations and liabilities to pay vendors,
suppliers, and Persons (including shareholders and other affiliates)
providing goods and services normally required in the ordinary course of
business (including forward sales) and on ordinary trade terms which are
not delinquent or which are being contested in good faith;
(iv) taxes, assessments and governmental charges or levies
which are not delinquent or which are being contested in good faith;
33
(v) contingent liabilities arising out of the endorsement in
the ordinary course of business of negotiable instruments in the course of
collection;
(vi) Debt to shareholders of the Borrowers which is
subordinated to the Borrowers' Debt to the Bank upon prior written approval
by the Bank; and
(vii) obligations to reimburse BPC for statutory, federal or
state income taxes which are based upon taxable income of BFC, even though
BPC may not be required to pay such taxes as a result of net operating
losses or net operating loss carryforwards or other tax credits available
to BPC and its subsidiaries on a consolidated basis.
(d) Limitation on Liens. Create, assume or permit to exist any
mortgage, deed of trust, pledge, encumbrance, lien or charge of any kind
(including any security interest in or vendor's lien on property purchased under
conditional sales or other title retention agreements and including any lease in
the nature of a title retention agreement) upon the Mortgaged Properties,
equipment thereon, or production therefrom, except:
(i) liens and security interests at any time existing in favor
of the Bank;
(ii) statutory liens for taxes and other sums, and liens for
materials and services under standard operating agreements for sums, which
are not delinquent or which are being contested in good faith; and
(iii) mechanics' and materialmen's liens with respect to
obligations which are not delinquent or which are being contested in good
faith.
(e) Limitation on Mergers. Merge or consolidate the Borrowers with
or into any other entity (including, but not limited to, Portland General
Corporation) without the prior written consent of the Bank, which consent may be
conditioned upon satisfaction of such reasonable conditions as the Bank may
specify to insure continuing liability and obligation for payment of the Loans
and for the continued perfection and priority of the liens and security
interests securing the Loans, except with each other Borrower.
(f) Limitation on Sales of Property. Sell, transfer, lease,
exchange, alienate or dispose of any portion of the Mortgaged Properties or any
material interest therein, except sale of oil and gas production in the ordinary
course of business.
(g) Fiscal Year. Change the fiscal year currently in effect for the
Borrowers, which is a calendar year.
(h) Amendment of Contracts. Amend or permit any amendment to any
contract (expressly including the American Atlas Contract) which releases,
qualifies,
34
limits, makes contingent or otherwise detrimentally affects the
rights and benefits pledged and assigned to and acquired by the Bank
pursuant to any Collateral Document.
(i) Limitation on Investments and New Businesses.
(i) Make any expenditure or commitment or incur any obligation
or enter into or engage in any transaction except in the ordinary course of
business;
(ii) engage directly or indirectly in any business or conduct
any operations except in connection with or incidental to the present
business and operations conducted by them;
(iii) make any acquisitions of or capital contributions to or
other investments in any business entities; or
(iv) make any significant acquisitions or investments in any
properties other than actual or prospective oil and gas properties and
related gathering, transportation, processing and marketing assets.
(j) Limitation on Credit Extensions. Extend credit, make advances or
make loans to any Person or entity other than normal and prudent extensions of
credit to customers buying goods and services in the ordinary course of
business, which extensions shall not be for longer periods than those extended
by similar businesses operated in a normal and prudent manner.
(k) ERISA Compliance. Permit any Plan maintained by it to (i) engage
in any "prohibited transaction" as such term is defined in Section 4975 of the
Internal Revenue Code of 1954, as amended; (ii) incur any "accumulated funding
deficiency" as such term is defined in Section 302 of ERISA; or (iii) terminate
in a manner which could result in the imposition of a lien on the property of
the Borrowers pursuant to Section 4068 of ERISA.
(l) Limitation on Certain Repayments. Repay any advances, or
interest thereon, owing to related or affiliated entities (including the
$3,600,000 advance from BPC shown on BFC's balance sheets dated September 30,
1993 and December 31, 1993 in the event such advance is not converted to
equity), except (i) to each other Borrower, and (ii) security deposits and
advances received by the Borrowers for the purchase and transportation of
natural gas in the ordinary course of business.
(m) Limitation on Payments to BPC. Make payments to BPC for the
payment of BFC's statutory income taxes for a given year, except to the extent
of the lesser of (i) BFC's statutory income taxes for that year, or (ii) BPC,s
actual income tax liability for that year.
35
ARTICLE IX
EVENTS OF DEFAULT AND THEIR EFFECT
Section 9.1 Events of Default. Each of the following events shall
constitute an Event of Default under this Agreement:
(a) Nonpayment of Notes. The Borrowers shall fail to pay any
Principal Amount of, or interest on, the Notes within ten (10) days of the date
when due.
(b) Collateral Documents. A default shall occur under the terms of
any of the Collateral Documents, or the Borrowers shall dispute the existence,
first priority or binding or enforceable nature of any lien established pursuant
to the Collateral Documents.
(c) Representations And Warranties. Any written representation or
warranty made by the Borrowers herein or by the Borrowers (or any of the
Borrowers' officers) in connection with this Agreement shall prove to have been
incorrect in any material respect when made and remains so at the time the Bank
elects to act with respect to such Event of Default pursuant to Section 9.2.
(d) Noncompliance With Specific Provisions Of This Agreement. The
Borrowers shall fail to perform or observe any term, covenant or obligation set
forth in Section 4.3 and Section 8.2(a), (b), (c), (d), (e), (f), (h), (i), (j),
(l), and (m) of this Agreement.
(e) Noncompliance With This Agreement. The Borrowers shall fail to
perform or observe any other term, covenant or agreement contained in this
Agreement on their part to be performed or observed, and any such failure shall
remain unremedied for thirty (30) days after written notice thereof shall have
been given to the Borrowers by the Bank.
(f) Nonpayment Of Other Indebtedness For Borrowed Money. Any of the
Borrowers shall fail to pay any Debt or any interest or premium thereon when due
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace period,
if any, specified in the agreement or instrument relating to such Debt; or any
other default under any agreement or instrument relating to any such Debt, or
any other event, shall occur and shall continue after the acceleration of the
maturity of such Debt; or any such Debt shall be declared to be due and payable,
or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof; provided, however, that no
such failure shall constitute an Event of Default so long as the validity of the
Debt or payment obligation is being contested in good faith by appropriate
proceedings and the Borrowers have set aside on their books adequate reserves
therefor.
(g) Bankruptcy, Insolvency, Etc. Any of the Borrowers shall (i)
generally not pay its debts as such debts became due; or (ii) admit in writing
its
36
inability to pay its debts generally, or shall make a general assignment
for the benefit of creditors; or (iii) institute any proceeding seeking to
adjudicate itself bankrupt or insolvent, or seeking liquidation, winding
up, reorganization, arrangement, adjustment, protection, relief, or
composition of its debts under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee, or other similar official
for itself or for any substantial part of its property; or (iv) suffer any
proceeding to be instituted against it for the purposes specified in the
foregoing clause (iii) which shall continue for more than sixty (60) days
without discharge or dismissal thereof; or (v) take any corporate or
individual action to authorize any of the actions set forth above in this
Section 9.1(q).
(h) Material Adverse Change. A material adverse change in any
Borrowers, condition (financial or otherwise), including changes due to
violations, or applications, of Environmental Laws to the Borrowers or their
properties, or a change in the key management personnel of BFC, which the Bank
determines, in its sole discretion, would have a Materially Adverse Effect on
the operations of the Borrowers. "Key management" includes Xxxxxx X. Xxxxxxxx,
current President of BFC.
(i) Judgment. Any judgment or order for the payment of money in
excess of $500,000 shall be rendered against any of the Borrowers and either (i)
enforcement proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) there shall be any period of ten (10) consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; provided, in either case,
that the Borrower in question has not made bonding, surety or other arrangements
acceptable to the Bank.
(j) American Atlas Contract. A material adverse change in the
American Atlas Contract. A "material adverse change," as used in this Section
9.1(j) means a change in the status of the American Atlas Contract which the
Bank determines in its sole discretion would have a Materially Adverse Effect on
the financial condition and operations of the Borrowers.
Section 9.2 Effect of the Occurrence of an Event of Default. If any Event
of Default described in Section 9.1 shall occur, the Bank may, by notice to the
Borrowers, (i) declare its obligation to make the Advances and to issue Letters
of Credit to be terminated, whereupon the same shall forthwith terminate, and/or
(ii) elect to have the Default Interest Rate apply to the Loans, and/or (iii)
declare the Loans and the Notes, all interest thereon and all other amounts
owing under this Agreement to be forthwith due and payable, whereupon the Loans
and the Notes, all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest, or further
notice of any kind, all of which are hereby expressly waived by the Borrowers.
In addition to the foregoing, following an Event of Default, so long as any
Letter of Credit has not been fully drawn and has not been cancelled or expired,
upon written demand by the Bank, the Borrowers shall deposit and maintain with
the Bank an account with cash in an amount and currency equal to the aggregate
undrawn Face Amount of all outstanding Letters of Credit, together with all fees
and other amounts due or which may
37
become due with respect thereto. The Borrowers shall have no control over funds
in such cash deposit account. The Bank agrees that any such cash deposit account
will be interest-bearing to the extent the Bank is reasonably able to do so.
Such funds shall be promptly applied by the Bank to reimburse itself for drafts
drawn under the Letters of Credit. Such funds, if any, remaining in such cash
deposit account following the payment in full of all Draws due hereunder or
under the Notes shall be promptly paid over to the Borrowers.
If the Bank does not accelerate the due date of the Loans, the Bank may
elect in its sole discretion to require the Borrowers to make each monthly
payment of principal and interest with respect to the Term Loan payments equal
to the greatest of the following, which right the Bank may exercise at any time
during the Amortizing Period after the occurrence of an Event of Default by
notice to the Borrowers:
A. accrued interest plus the principal payments set forth in the
minimum monthly principal payment schedule in Section 3.3; or
B. up to seventy percent (70%) of the Borrowers' Gross Revenue from
the Mortgaged Properties applied first to accrued interest, then to principal;
or
C. up to one hundred (100%) of the Borrowers' Net Revenue from the
Mortgaged Properties applied first to accrued interest, then to principal.
In the event the Bank elects to exercise the right to receive the maximum
payment allowed above, the Borrowers shall provide to the Bank all information
the Bank reasonably determines to be necessary to calculate the payments which
are due under alternative clauses B. and C. above.
ARTICLE X
MISCELLANEOUS
Section 10.1 Amendments, Etc. No amendment of any provision of the Loan
Documents, nor consent to any departure by the Borrowers therefrom, shall in any
event be effective unless the same shall be in writing and signed by all of the
parties hereto. No waiver by the Bank of any provision of the Loan Documents,
or the Bank's consent to any departure by the Borrowers therefrom, shall in any
event be effective unless the same shall be in writing and signed by the Bank,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
Section 10.2 Notices, Etc. Any notice and other communications provided
for hereunder shall be in writing and shall be deemed to have been given when
personally delivered, when received if sent by facsimile, when delivered if sent
by Federal Express or Express Mail, or three (3) Business Days after having been
mailed by United States registered or certified mail, return receipt requested,
postage prepaid, addressed to the party for whom it is intended at the following
addresses:
38
Borrowers: Bonneville Fuels Corporation
0000 Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxxx X. Xxxxxxxx, President
Facsimile: (000) 000-0000
with a copy to:
Xx. Xxxxx Xxxxx
Xxxxx, Xxxxxxxxx & Xxxxx
000 X. 000 Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Bank: First Interstate Bank of Denver, N.A.
000 Xxxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Xx. Xxxx X. Xxxxxxxx,
Vice President Energy Banking
Facsimile: (000) 000-0000
Any party may change its address for purposes of receipt of any such
communication by giving ten (10) Business Days' prior written notice of such
change to the other party in the manner above prescribed.
Section 10.3 Damage Limitation. Neither Party shall be liable to the
other for consequential damages, whatever the nature of a breach by the other
party in its obligations relating to the transactions governed or contemplated
by this Agreement.
Section 10.4 Release. Upon full payment and satisfaction of the Loans and
the interest thereon, as provided herein, the parties shall thereupon
automatically each be fully, finally, and forever released and discharged from
any further claim, liability or obligation in connection with the Loans.
Section 10.5 Lost Note. Upon receipt by the Borrowers of evidence of the
loss, theft, destruction or mutilation of the Notes and, in the case of loss,
theft or destruction, of indemnity reasonably satisfactory to the Borrowers
(with the Bank's indemnity in case of loss, theft or destruction of the Notes
owned by the Bank to be reasonably satisfactory to Borrowers), and upon
surrender and cancellation of the Notes if mutilated, the Borrowers will pay any
unpaid principal and interest (and any prepayment charge) then or theretofore
due and payable on the Notes and will at the request of the Bank promptly
execute and deliver in lieu of the Notes a replacement Notes of like tenor for
any remaining balance due.
Section 10.6 No Waiver; Remedies. No failure on the part of the Bank to
exercise, and no delay in exercising, any right under the Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right under the Loan
39
Documents preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
Section 10.7 Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the Borrowers and the Bank and their respective
successors and assigns, except that the Borrowers shall not assign their rights
hereunder or any interest herein without the prior written consent of the Bank.
The Bank may assign to one or more banks or other entities all or any part of,
or may grant participations to one or more banks or other entities in or to all
or any part of, the Advance or Advances and the Notes. To the extent of any such
assignment (unless otherwise stated therein), the assignee shall have the same
rights and benefits hereunder and under the Notes as it would have if it were
the Bank hereunder.
Section 10.8 GOVERNING LAW AND SUBMISSION TO JURISDICTION. THE SUBSTANTIVE
LAW OF COLORADO SHALL GOVERN ALL THE TERMS, CONDITIONS AND INTERPRETATIONS OF
THIS AGREEMENT, THE NOTES, THE LOANS AND ALL OTHER INSTRUMENTS, DOCUMENTS OR
AGREEMENTS EXECUTED PURSUANT HERETO, EXCEPT FOR THE REAL AND PERSONAL PROPERTY
LAW, INCLUDING SECURED TRANSACTION LAW, THAT MAY BE CONTROLLING IN SITUATIONS
WHERE THE REAL AND/OR PERSONAL PROPERTY IS LOCATED IN STATES OTHER THAN
COLORADO. IN THE EVENT OF LITIGATION CONCERNING THIS AGREEMENT, THE NOTES, THE
LOANS OR ANY OTHER INSTRUMENTS, DOCUMENTS OR AGREEMENTS EXECUTED OR DELIVERED
PURSUANT HERETO, EXCEPT LITIGATION FOR THE EXERCISE OF REMEDIES BY THE BANK WITH
RESPECT TO PROPERTY LOCATED IN STATES OTHER THAN COLORADO, AND SUBJECT TO THE
PROVISIONS OF SECTION 10.11, THE PARTIES HERETO AGREE THAT THE EXCLUSIVE PLACE
OF JURISDICTION SHALL BE THE STATE OF COLORADO, CITY AND COUNTY OF DENVER, AND
THE VENUE SHALL BE ANY STATE OR FEDERAL COURT LOCATED THEREIN. FURTHER, THE
BORROWERS CONSENT TO AND AGREE TO FILE A GENERAL APPEARANCE IN THE EVENT THEY
RECEIVE A SERVICE OF PROCESS.
Section 10.9 Relationship to Other Documents. In the event any provision
hereof is in conflict with any provision of the Collateral Documents, the
provisions hereof shall be controlling.
Section 10.10 Severability. In the event any provision of this Agreement,
the Notes or any of the other instruments, documents or agreements executed
pursuant hereto shall be held invalid or unenforceable by any court of competent
jurisdiction, such holding shall not invalidate or render unenforceable any
other provision hereof or thereof or affect the validity or enforceability of
such provision in any other jurisdiction.
Section 10.11 Arbitration. Subject to the provisions of the next
paragraph below, the Bank and the Borrowers agree to submit to binding
arbitration any and all
40
claims, disputes and controversies between them or among them (and their
respective employees, officers, directors, attorneys, and other agents) relating
to the Loans and its negotiation, execution, collateralization, administration,
repayment, modification, extension or collection. Such arbitration shall proceed
in Denver, Colorado, shall be governed by Colorado law (including without
limitation the provisions of C.R.S. (S) 13-21-102(5)) and shall be conducted in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association ("AAA"). Any award entered in an arbitration, whether on motions or
at a hearing with or without testimony from witnesses, shall be made by a
written opinion stating the reasons for the award made. The decisions of any
arbitration pursuant to this Agreement shall be made based on Colorado law
without reference to any choice of law rules. Judgment on any award hereunder
may be entered in any court having jurisdiction.
Nothing in the preceding paragraph, nor the exercise of any right to
arbitrate thereunder, shall limit the right of any party hereto (a) to foreclose
against any real or personal property Collateral by the exercise of the power of
sale under a deed of trust, mortgage, or other security agreement, or
instrument, or applicable law; (b) to exercise self-help remedies such as setoff
or repossession; or (c) to obtain provisional or ancillary remedies such as
replevin, injunctive relief, attachment, or appointment of a receiver from a
court having jurisdiction, before, during or after the pendency of any
arbitration proceeding. The institution and maintenance of any action for such
judicial relief, or pursuit of provisional or ancillary remedies, or exercise of
self-help remedies shall not constitute a waiver of the right or obligation of
any party to submit any claim or dispute to arbitration, including those claims
or disputes arising from exercise of any judicial relief, or pursuit of
provisional or ancillary remedies, or exercise of self-help remedies.
Arbitration hereunder shall be before a three-person panel of neutral
arbitrators, consisting of one person from each of the following categories: (1)
an attorney who has practiced in the area of commercial law for at least ten
(10) years or a retired judge at the Colorado or United States District Court or
an appellate court level; (2) a person with at least ten (10) years' experience
in commercial lending; and (3) a person with at least five (5) years, experience
in the petroleum industry. The AAA shall submit a list of persons meeting the
criteria outlined above for each category of arbitrator, and the parties shall
select one person from each category in the manner established by the AAA.
Section 10.12 Table of Contents, Headings. The Table of Contents and the
headings for the Articles and Sections hereof are for convenience of reference
only and shall not affect the meaning or construction hereof.
Section 10.13 Counterparts. This Agreement may be executed in any number
of counterpart copies. Each fully executed counterpart shall be considered an
original, but together such copies shall constitute one and the same instrument.
Section 10.14 Joint and Several Liability. All obligations of the
Borrowers hereunder or under the Notes shall be joint and several.
41
Section 10.15 Confidentiality. The Bank shall use reasonable efforts to
maintain the confidentiality of information provided by the Borrowers to the
Bank which (a) the Borrowers request be treated as confidential, and (b) which
is not otherwise available to the public.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
BORROWERS:
BONNEVILLE FUELS CORPORATION BONNEVILLE FUELS OPERATING CORPORATION
By:_____________________________ By:______________________________
Name: Xxxxxx X. Xxxxxxxx Name: Xxxxxx X. Xxxxxxxx
Title: President Title: President
BONNEVILLE FUELS MARKETING CORPORATION BONNEVILLE FUELS MANAGEMENT CORPORATION
By:_____________________________ By:______________________________
Name: Xxxxxx X. Xxxxxxxx Name: Xxxxxx X. Xxxxxxxx
Title: President Title: President
COLORADO GATHERING CORPORATION
By:_____________________________
Name: Xxxxxx X. Xxxxxxxx
Title: President
BANK:
FIRST INTERSTATE BANK OF
DENVER, N.A.
By:_____________________________
Xxxx X. Xxxxxxxx
Vice President
42
FORM OF FACILITY A NOTE
REVOLVING NOTE
$20,000,000 May 31, 1994
FOR VALUE RECEIVED, the undersigned, BONNEVILLE FUELS CORPORATION, as
Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a Utah
corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation and BONNEVILLE FUELS MANAGEMENT
CORPORATION, a Utah corporation (collectively the "Borrowers"), HEREBY JOINTLY
AND SEVERALLY PROMISE TO PAY to the order of FIRST INTERSTATE BANK OF DENVER,
N.A. (the "Bank") on or before the Facility A Maturity Date (as defined in the
Credit Agreement identified below) the Principal Amount of Twenty Million
Dollars ($20,000,000), or such lesser amount as has been Advanced by the Bank to
the Borrowers as Facility A Loans pursuant to the Credit Agreement (as defined
below). Subject to the Credit Agreement, the Borrowers may borrow, repay and
reborrow amounts hereunder until the Conversion Date (as defined in the Credit
Agreement)
The Borrowers promise to pay interest on the Principal Amount of each
Advance from the date of such Advance until such Principal Amount is paid in
full, at such Interest Rates, and payable at such times, as are specified in the
Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to the Bank at 000 Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx (or at
such other location as the Bank may designate), in same day funds. Each Advance
made by the Bank to the Borrowers and the maturity thereof, and all payments
made on account of principal hereof, shall be recorded by the Bank and, prior to
any transfer hereof, endorsed on the grid attached hereto which is part of this
Note.
This Note is the Facility A Note referred to in and is entitled to the
benefits of the Amended and Restated credit Agreement dated as of May 31, 1994
(the "Credit Agreement"), between the Borrowers and the Bank, which Credit
Agreement, among other things, (i) provides for the making of Advances by the
Bank to the Borrowers from time to time in an aggregate amount not to exceed at
any time outstanding the amount first above mentioned or such reduced amount as
set forth in the Credit Agreement, and (ii) contains provisions for acceleration
of the maturities hereof upon the happening of certain stated events. Terms
used herein which are defined in the Credit Agreement shall have the meanings
specified in the Credit Agreement.
This Note represents an extension and renewal of the outstanding principal
amount of, and a replacement and substitution for, a certain Promissory Note of
Bonneville Fuels Corporation, dated August 30, 1991 (the "Prior Note"), payable
to the order of Chase Manhattan Bank (National Association). The Prior Note has
been transferred to the Bank. The Indebtedness evidenced by the Prior Note is a
continuing indebtedness and nothing contained herein shall be construed to deem
paid the Prior Note or to replace or terminate any lien or security interest
given to secure payment of the Prior Note.
Demand, presentment for payment, notice of dishonor and protest are hereby
expressly waived by the Borrowers.
BONNEVILLE FUELS CORPORATION
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President
BONNEVILLE FUELS MARKETING CORPORATION
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President
COLORADO GATHERING CORPORATION
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President
BONNEVILLE FUELS OPERATING CORPORATION
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President
PROMISSORY NOTE
$1,000,000.00 Denver, Colorado
May 31, 1994
FOR VALUE RECEIVED, the undersigned (referred to, collectively if more
than one, as "Borrower") jointly and severally hereby promises to pay to the
order of FIRST INTERSTATE BANK OF DENVER, N.A., (referred to, together with any
subsequent holder of this note, as "Holder"), at 000 Xxxxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxx 00000, or at such other address as may be specified by any Holder, upon
demand the principal sum of ONE MILLION DOLLARS ($1,000,000.00), or so much
thereof as may be advanced to or for the benefit of Borrower, together with
interest on the balance of principal outstanding from time to time at a floating
rate which is one percent (1%) per annum higher than the "Bank's Prime Rate" (as
that term is defined below), in lawful money of the United States of America.
Interest shall be calculated based on a three hundred sixty-five (365) day year
and charged for the actual number of days elapsed.
The principal balance of this note represents a revolving credit, all
or any part of which may be advanced to Borrower, repaid by Borrower, and re-
advanced to Borrower from time to time, subject to the other terms hereof and
the conditions contained in the Credit Agreement (defined below), and provided
that Borrower shall not be entitled to any advances that would cause the
principal balance outstanding at any one time to exceed the Facility B
Commitment (defined in the Credit Agreement). The revolving credit evidenced by
this note is to be used for cash advances and for the issuance of standby
letters of credit as set forth in the Credit Agreement. This note also
evidences any other sums payable under the Credit Agreement with respect to
Facility B Loans or any document securing this note.
As used in this note, the term "Bank's Prime Rate" means the prime
commercial lending rate established and announced from time to time by First
Interstate Bank of Denver, N.A., its successors and assigns ("Bank"). Bank's
Prime Rate is an index rate that Bank establishes and quotes from time to time
for pricing certain of its loans. Information on the index rate currently in
effect is announced publicly or can be obtained by contacting Bank. Bank's
Prime Rate is not necessarily the lowest rate charged to Bank's customers and
Bank may make loans at, above or below this state index rate. The rate of
interest borne by the outstanding principal balance of this note shall change
from time to time on the effective date of, and in conformity with, changes in
the Bank's Prime Rate. Changes in the interest rate on this note shall be
effective without notice to Borrower.
Interest and principal shall be payable in accordance with the
provisions of the Credit Agreement. If not sooner paid, the entire unpaid
balance of principal and interest shall be due and payable in full on April 1,
1995. The inclusion of specific
default provisions or rights of Holder in the Credit Agreement shall not
preclude Holder's right to declare payment of this note on Holder's demand in
accordance with the terms of the Credit Agreement.
All payments on this note shall be applied first to the payment of any
costs, fees, late charges or other charges incurred in connection with the
indebtedness evidenced hereby, next to the payment of accrued interest and then
to the reduction of the principal balance.
This note may be prepaid in whole or in part, at any time, without fee
or premium.
This note is the Facility B Note referred to in and is entitled to the
benefits of the Amended and Restated Credit Agreement date as of May 31, 1994
(the "Credit Agreement"), between the Borrower and Holder, which Credit
Agreement, among other things, (i) provides for the making of Advances by the
Holder to the Borrower from time to time in an aggregate amount not to exceed at
any time outstanding the amount first above mentioned or such reduced amount as
set forth in the Credit Agreement, and (ii) contains provisions for acceleration
of the maturities hereof upon the happening of certain stated events.
Capitalized terms used herein which are not specifically defined herein shall
the meanings specified in the Credit Agreement. In the event any provision of
this note is inconsistent with any provision of the Credit Agreement, the Credit
Agreement provision shall apply.
Time is of the essence of each and every provision of this note.
Borrower and all parties now or hereafter liable for payment of this
note, primarily or secondarily, directly or indirectly, and whether as endorser,
guarantor, surety or otherwise, hereby severally (a) waive presentment, demand,
protest, notice of protest, notice of dishonor and all other notices and demands
whatever, other than any notice which may be required pursuant to any provision
of the Credit Agreement, (b) consent to impairment or release of collateral,
extensions of time for payment, and acceptance of late or partial payments
before, at or after maturity, (c) agree that Holder's acceptance of one or more
partial payments after acceleration of the maturity of this note will not
constitute a waiver of such acceleration, regardless of any contrary notice or
statement of condition which may accompany any such partial payment, (d) waive
any right to require Holder to proceed against any security for this note before
proceeding hereunder, and (e) agree to pay all costs and expenses, including,
without limitation, attorneys' fees, which may be incurred by Holder in
collecting this note or in enforcing and realizing upon any security for this
note.
The provisions of this note and of all agreements now or hereafter
existing between Borrower and Holder are hereby expressly limited so that in no
contingency or event whatsoever, whether by acceleration of the maturity of this
note or otherwise, shall the amount paid or agreed to be paid to Holder for the
use, forbearance or detention of the sums evidenced by this note exceed the
maximum amount permissible under Colorado
2
law. If, from any circumstances whatsoever, the performance or fulfillment of
any obligation of this note, or of any other agreement between Borrower and
Holder, at the time performance of such obligation shall be due, shall exceed
the limitation prescribed by law, then, ipso facto, the obligation to be
performed or fulfilled shall be reduced to the limitation, and, if from any such
circumstance, Holder shall ever receive anything of value which is deemed to be
interest by Colorado law which would exceed the highest lawful rate, an amount
equal to any excessive interest shall be applied to the reduction of principal
amount of this note or on account of any other principal indebtedness of
Borrower to Holder and to the payment of interest thereon or, if such excessive
interest exceeds the unpaid balance of principal of this note and such other
indebtedness, such excess shall be refunded to Borrower.
This note shall be binding upon Borrower and its successors and
assigns and shall inure to the benefit of Holder and its successors and assigns.
All notices required or permitted in connection with this note shall
be given at the place and in the manner provided in the Credit Agreement for the
giving of notices.
Wherever possible, each provision of this note shall be interpreted so
as to be effective and valid under applicable law. If any provision of this
note is, for any reason and to any extent, invalid or unenforceable, then
neither the remainder of this note, nor any other document referred to in this
note, nor the application of the provision to other persons or in other
circumstances, shall be affected by such invalidity or unenforceability.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAW OF THE STATE OF COLORADO. BORROWER HEREBY CONSENTS TO THE EXERCISE OF
JURISDICTION OVER IT BY ANY FEDERAL COURT SITTING IN COLORADO OR ANY COLORADO
DISTRICT COURT SELECTED BY LENDER, FOR THE PURPOSES OF ANY AND ALL LEGAL
PROCEEDINGS ARISING OUT OF OR RELATING TO THE NOTE, THE CREDIT AGREEMENT AND ALL
OTHER LOAN DOCUMENTS (DEFINED IN THE CREDIT AGREEMENT). BORROWER IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH PROCEEDING BROUGHT IN ANY
SUCH COURT, ANY CLAIM BASED ON THE CONSOLIDATION OF PROCEEDINGS IN SUCH COURTS
IN WHICH PROPER VENUE MAY LIE IN DIVERGENT JURISDICTIONS, AND ANY CLAIM THAT ANY
SUCH PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
3
BONNEVILLE FUELS CORPORATION
By:_____________________________
Xxxxxx X. Xxxxxxxx, President
BONNEVILLE FUELS MARKETING CORPORATION
By:_____________________________
Xxxxxx X. Xxxxxxxx, President
COLORADO GATHERING CORPORATION
By:_____________________________
Xxxxxx X. Xxxxxxxx, President
BONNEVILLE FUELS OPERATING CORPORATION
By:_____________________________
Xxxxxx X. Xxxxxxxx, President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By:_____________________________
Xxxxxx X. Xxxxxxxx, President
4
FORM OF TERM NOTE
-----------------
TERM NOTE
---------
$20,000,000 May 31, 1994
FOR VALUE RECEIVED, the undersigned, BONNEVILLE FUELS CORPORATION, as
Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a Utah
corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation and BONNEVILLE FUELS MANAGEMENT
CORPORATION, a Utah corporation (collectively the "Borrowers"), HEREBY JOINTLY
AND SEVERALLY PROMISE TO PAY to the order of FIRST INTERSTATE BANK OF DENVER,
N.A. (the "Bank") on or before the Facility A Maturity Date (as defined in the
Credit Agreement identified below) the Principal Amount of Twenty Million
Dollars ($20,000,000), or such lesser amount of unrepaid Facility A Loans under
the Credit Agreement in effect on the Conversion Date (as defined in the Credit
Agreement). The Principal Amount hereof shall be repaid by the Borrowers in
monthly installment payments on a schedule which is established as provided in
the Credit Agreement.
The Borrowers promise to pay interest on the unpaid Principal Amount hereof
in full monthly installment payments from the Conversion Date until such
Principal Amount is paid in full, at such Interest Rates and as otherwise
provided in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to the Bank at 000 Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx (or at
such other location as the Bank may designate), in same day funds. Each
principal payment or prepayment and the resulting principal balance hereof shall
be recorded by the Bank and, prior to any transfer hereof, endorsed on the grid
attached hereto which is part of this Note.
This Note is the Term Note referred to in and is entitled to the benefits
of the Amended and Restated credit Agreement dated as of May 31, 1994 (the
"Credit Agreement"), between the Borrowers and the Bank, which Credit Agreement,
among other things, contains provisions for acceleration of the maturities
hereof upon the happening of certain stated events. Terms used herein which are
defined in the Credit Agreement shall have the meanings specified in the Credit
Agreement.
This Note represents an extension and renewal of the outstanding principal
amount of, and a replacement and substitution for, a certain Promissory Note of
Bonneville Fuels Corporation, dated August 30, 1991 (the "Prior Note"), payable
to the order of Chase Manhattan Bank (National Association) and the Revolving
Note. The Prior Note has been transferred to the Bank. The Indebtedness
evidenced by the Prior Note and by the Revolving Note is a continuing
indebtedness and nothing contained herein shall be construed to deem paid the
Prior Note or the Revolving Note or to replace or terminate any lien or security
interest given to secure payment of the Prior Note or the Revolving Note.
Demand, presentment for payment, notice of dishonor and protest are hereby
expressly waived by the Borrowers.
BONNEVILLE FUELS CORPORATION
By: ___________________________
Name: Xxxxxx X. Xxxxxxxx
Title: President
BONNEVILLE FUELS MARKETING
CORPORATION
By: ___________________________
Name: Xxxxxx X. Xxxxxxxx
Title: President
COLORADO GATHERING CORPORATION
By: ___________________________
Name: Xxxxxx X. Xxxxxxxx
Title: President
BONNEVILLE FUELS OPERATING
CORPORATION
By: ___________________________
Name: Xxxxxx X. Xxxxxxxx
Title: President
BONNEVILLE FUELS MANAGEMENT
CORPORATION
By: ___________________________
Name: Xxxxxx X. Xxxxxxxx
Title: President
NOTE MODIFICATION AGREEMENT
================================================================================
Borrowers: Bonneville Fuels Corporation,
Bonneville Fuels Marketing Corporation,
Colorado Gathering Corporation,
Bonneville Fuels Operating Corporation, and
Bonneville Fuels Management Corporation
(referred to herein, collectively if more than one, as "Borrower")
0000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000
Lender: First Interstate Bank of Denver, N.A.
(referred to herein, together with any subsequent holder of this
Note Modification Agreement, as "Holder")
000 00xx Xxxxxx, Xxxxxx, XX 00000
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Xxxxxx, Xxxxxxxx April 1, 1995
DESCRIPTION OF THE PROMISSORY NOTED MODIFIED BY THIS NOTE MODIFICATION
AGREEMENT: That certain Promissory Note in the original principal amount of
$1,000,000.00 dated May 31, 1994, from Borrower in favor of Holder (the
"Facility B Note"). Capitalized terms used herein, which are not specifically
defined herein, shall have the meanings given them in the Promissory Note.
DESCRIPTION OF TERMS MODIFIED BY THIS NOTE MODIFICATION AGREEMENT: The final
payment date of "April 1, 1995" contained in the fourth paragraph of the
Facility B Note, is hereby replaced by a new final payment date of "May 1,
1996."
CONTINUING VALIDITY: Except as expressly modified by this Note Modification
Agreement, the terms of the original obligation(s), including the Facility B
Note, the Credit Agreement, and all other agreements evidenced or securing the
obligation(s), remain unchanged and in full force and effect. Consent by the
Holder to this Note Modification Agreement does not waive Holder's right to
strict performance of the obligation(s) as modified, nor obligate the Holder to
make any future modification of the terms of the obligation(s). Nothing in this
Note Modification Agreement will constitute a satisfaction of the obligation(s).
BORROWERS:
---------
BONNEVILLE FUELS CORPORATION BONNEVILLE FUELS OPERATING CORPORATION
By: ____________________________ By: _______________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
BONNEVILLE FUELS MARKETING CORPORATION
By: ____________________________
Xxxxxx X. Xxxxxxxx, President
COLORADO GATHERING CORPORATION BONNEVILLE FUELS MANAGEMENT CORPORATION
By: ____________________________ By: _______________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
LENDER:
------
FIRST INTERSTATE BANK OF DENVER, N.A.
By: ____________________________
Xxxx X. Xxxxxxxx, Vice President
AMENDMENT TO CREDIT AGREEMENT
-----------------------------
This AMENDMENT TO CREDIT AGREEMENT, dated as of April 1, 1995, is made and
entered into in Denver, Colorado, by and between BONNEVILLE FUELS CORPORATION, a
Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a Utah
corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation, and BONNEVILLE FUELS MANAGEMENT
CORPORATION, a Utah corporation (collectively, the "Borrowers"), whose address
and principal location of their business is 1660 Lincoln, Xxxxx 0000, Xxxxxx,
Xxxxxxxx, 00000, and FIRST INTERSTATE BANK OF DENVER, N.A., a national banking
association (the "Bank"), whose address is 000 Xxxxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxx 00000.
RECITALS:
--------
WHEREAS, the Borrowers and the Bank entered into that certain Amended and
Restated Credit Agreement dated as of May 31, 1994 (referred to herein as the
"Credit Agreement") wherein the Bank agreed to provide to the Borrowers two
credit facilities referred to as "Facility A" and "Facility B" (collectively,
the "Loans") subject to the terms and conditions set forth in the Credit
Agreement (capitalized terms not specifically defined herein shall have the
meanings given them in the Credit Agreement);
WHEREAS, the Borrowers have requested that (i) modifications be made to
certain financial covenants set forth in Section 8.1(e) of the Credit Agreement,
and that (ii) the final payment date of Facility B be extended to May 1, 1996,
subject to the terms of the Credit Agreement, as amended by this Amendment to
Credit Agreement;
WHEREAS, the Bank, as an accommodation to the Borrowers, is willing to make
modifications to certain financial covenants, and to extend the final payment
date of Facility B, subject to the terms of the Credit Agreement as amended by
this Amendment to Credit Agreement; and
WHEREAS, the parties desire to amend and reaffirm the Credit Agreement and
to enter into this Amendment to Credit Agreement to reflect the terms and
conditions of, and to describe their respective rights and obligations with
respect to, the Loans.
NOW THEREFORE, in consideration of the mutual covenants and agreements set
forth in the Credit Agreement and in this Amendment to Credit Agreement, the
parties hereto agree as follows effective as of April 1, 1995:
1. The definition of "Facility B Maturity Date" in Section 1.1 (page 6) of the
Credit Agreement is hereby modified by replacing the date "April 1, 1995"
with the date "May 1, 1996", effective as of April 1, 1995.
2. The table and related footnotes in Section 8.1(e) (page 33) of the Credit
Agreement is hereby replaced in its entirety by the following table and
footnotes, effective as of January 1, 1995:
During The During The
Revolving Amortizing
Period Period
---------- ----------
Minimum Working Capital (1): $250,000 $500,000
Minimum Current Ratio (1): 1.05x 1.25x
Minimum Net Worth (2): $2,300,000 $3,000,000
Minimum Net Worth (3): $5,900,000 $6,600,000
Maximum Debt/Worth (2): 6.00x 5.00x
Maximum Debt/Worth (3): 2.00x 1.75x
Minimum Fixed Charge Coverage (4): 1.00x 1.00x
1) With the current portion of Facility A treated as a non-current
liability, and the undrawn and available portion of Facility A treated
as a current asset.
2) With advances from BPC ($3.6 million currently) treated as a liability.
3) With advances from BPC ($3.6 million currently) treated as equity.
4) (i) Net income after tax plus interest expense plus depreciation,
depletion and amortization, plus other non-cash charges, divided by
(ii) interest expenses plus required principal payments, calculated
quarterly on a fiscal year-to-date basis.
3. Miscellaneous:
a. Except as specifically amended, all of the terms, conditions and
provisions of the Credit Agreement and any and all documents executed
in connection therewith shall remain in full force and effect.
b. THIS AMENDMENT TO CREDIT AGREEMENT IS ACCEPTED AND ENTERED INTO IN THE
STATE OF COLORADO AND SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE
WITH THE SUBSTANTIVE LAWS OF THE STATE OF COLORADO.
c. The Borrowers represent and warrant to the Bank that the execution and
delivery of this Amendment to Credit Agreement and the performance by
the Borrowers of their obligations hereunder are within the Borrowers'
powers, have been duly authorized by all necessary corporate action,
and will not contravene or conflict with any provision of law or of the
articles or bylaws of the Borrowers, or of any agreement binding upon
the Borrowers.
d. The Borrowers represent and warrant to the Bank that all of the
representations and warranties of the Borrowers contained in the Credit
Agreement, as amended by this Amendment to Credit Agreement, are true
and correct in all material respects on the date hereof as though made
as of the date hereof, provided, however, that any reference to the
Credit Agreement shall be deemed to refer to the Credit Agreement as
amended by this Amendment to Credit Agreement.
e. All references to the Credit Agreement in any other document,
instrument, agreement or writing shall hereafter be deemed to refer to
the Credit Agreement as amended by this Amendment to Credit Agreement.
f. This Amendment to Credit Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of
which are identical, and all such counterparts shall together
constitute but one and the same Amendment to Credit Agreement.
2
IN WITNESS WHEREOF, the Borrowers and the Bank have executed this Agreement
to Credit Agreement effective as of April 1, 1995.
BORROWERS:
---------
BONNEVILLE FUELS CORPORATION BONNEVILLE FUELS OPERATING CORPORATION
By: __________________________ By: _____________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
BONNEVILLE FUELS MARKETING CORPORATION
By: _________________________
Xxxxxx X. Xxxxxxxx, President
COLORADO GATHERING CORPORATION BONNEVILLE FUELS MANAGEMENT CORPORATION
By: __________________________ By: _____________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
BANK:
----
FIRST INTERSTATE BANK OF DENVER, N.A.
By: __________________________
Xxxx X. Xxxxxxxx, Vice President
3
NOTE MODIFICATION AGREEMENT
================================================================================
Borrowers: Bonneville Fuels Corporation,
Bonneville Fuels Marketing Corporation,
Colorado Gathering Corporation,
Bonneville Fuels Operating Corporation, and
Bonneville Fuels Management Corporation
(referred to herein, collectively if more than one, as "Borrower")
0000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000
Lender: First Interstate Bank of Denver, N.A.
(referred to herein, together with any subsequent holder of this
Note Modification Agreement, as "Holder")
000 00xx Xxxxxx, Xxxxxx, XX 00000
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Xxxxxx, Xxxxxxxx May 1, 1996
DESCRIPTION OF THE PROMISSORY NOTED MODIFIED BY THIS NOTE MODIFICATION
AGREEMENT: That certain Promissory Note in the original principal amount of
$1,000,000.00 dated May 31, 1994, as previously amended by that certain Note
Modification Agreement dated April 1, 1995, from Borrower in favor of Holder
(the aforementioned Promissory Note as previously amended by the aforementioned
Note Modification Agreement is herein referred to as the "Facility B Note").
Capitalized terms used herein, which are not specifically defined herein, shall
have the meanings given them in the Facility B Note.
DESCRIPTION OF TERMS MODIFIED BY THIS NOTE MODIFICATION AGREEMENT: The final
payment date of "May 1, 1996" contained in the fourth paragraph of the Facility
B Note, is hereby replaced by a new final payment date of "May 1, 1998."
CONTINUING VALIDITY: Except as expressly modified by this Note Modification
Agreement, the terms of the original obligation(s), including the Facility B
Note, the Credit Agreement, and all other agreements evidenced or securing the
obligation(s), remain unchanged and in full force and effect. Consent by the
Holder to this Note Modification Agreement does not waive Holder's right to
strict performance of the obligation(s) as modified, nor obligate the Holder to
make any future modification of the terms of the obligation(s). All references
to the Facility B Note in any other document, instrument, agreement or writing
shall hereafter be deemed to refer to the Facility B Note as previously amended
and as amended by this Note Modification Agreement.
BORROWERS:
---------
BONNEVILLE FUELS CORPORATION BONNEVILLE FUELS OPERATING CORPORATION
By: _________________________ By: ___________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
BONNEVILLE FUELS MARKETING CORPORATION
By: __________________________
Xxxxxx X. Xxxxxxxx, President
COLORADO GATHERING CORPORATION BONNEVILLE FUELS MANAGEMENT CORPORATION
By: __________________________ By: ___________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
LENDER:
------
FIRST INTERSTATE BANK OF DENVER, N.A.
By: __________________________
Xxxx X. Xxxxxxxx, Vice President
SECOND AMENDMENT TO CREDIT AGREEMENT
------------------------------------
This SECOND AMENDMENT TO CREDIT AGREEMENT, dated as of April 1, 1996, is
made and entered into in Denver, Colorado, by and between BONNEVILLE FUELS
CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a
Utah corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively, the
"Borrowers"), whose address and principal location of their business is 1660
Lincoln, Xxxxx 0000, Xxxxxx, Xxxxxxxx, 00000, and FIRST INTERSTATE BANK OF
DENVER, N.A., a national banking association (the "Bank"), whose address is 000
Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000.
RECITALS:
--------
WHEREAS, the Borrowers and the Bank entered into that certain Amended and
Restated Credit Agreement dated as of May 31, 1994, wherein the Bank agreed to
provide to the Borrowers two credit facilities referred to as "Facility A" and
"Facility B" (collectively, the "Loans") subject to the terms and conditions set
forth in the Credit Agreement;
WHEREAS, the Amended and Restated Credit Agreement was amended by the
Borrowers and the Bank pursuant to the certain Amendment to Credit Agreement
dated as of April 1, 1995 (the Amended and Restated Credit Agreement as
previously amended is referred to herein as the "Credit Agreement," and
capitalized terms not specifically defined herein shall have the meanings given
them in the Credit Agreement);
WHEREAS, the Borrowers have requested the extension of the Conversion Date
of Facility A and the Facility B Maturity Date, as well as the modification of
certain other Credit Agreement terms, conditions, covenants, requirements, and
events of default;
WHEREAS, the Bank, as an accommodation to the Borrowers, is willing to
agree to the extension of the Conversion Date of Facility A and the Facility B
Maturity Date, as well as the modification of certain other Credit Agreement
terms, conditions, covenants, requirements and events of default, subject to the
terms of the Credit Agreement as amended by this Second amendment to Credit
Agreement; and
WHEREAS, the parties desire to amend and reaffirm the Credit Agreement and
to enter into this Second Amendment to Credit Agreement to reflect the terms and
conditions of, and to describe their respective rights and obligations with
respect to, the Loans.
NOW THEREFORE, in consideration of the mutual covenants and agreements set
forth in the Credit Agreement and in this Second Amendment to Credit Agreement,
the parties hereto agree as follows effective as of April 1, 1996:
1. The definition of "Conversion Date" in Section 1.1 Certain Defined Terms
(page 4) of the Credit Agreement is hereby modified by replacing the date
"April 1, 1996" in the last sentence of this definition with the date "April
1, 1998".
2. The definition of "Facility B Maturity Date" in Section 1.1 Certain Defined
Terms (page 6) of the Credit Agreement is hereby modified by replacing the
date "April 1, 1996" with the date "May 1, 1998".
3. The first sentence of Section 4.4 A/R Borrowing Base Determinations (page
20) of the Credit Agreement is hereby modified by replacing "60%" with
"75%".
4. The first sentence of section 8.1(b) Books, Financial Statements and
Reports, (i) (page 30) of the Credit Agreement is hereby modified by
replacing "ninety (90) days" with "one hundred twenty (120) days".
5. Section 9.1(h) Material Adverse Change (page 40) of the Credit Agreement is
hereby modified by eliminating the phrase "or a change in the key management
personnel of BFC,".
6. Miscellaneous:
a. Except as specifically amended, all of the terms, conditions and
provisions of the Credit Agreement and any and all documents executed in
connection therewith shall remain in full force and effect.
b. THIS SECOND AMENDMENT TO CREDIT AGREEMENT IS ACCEPTED AND ENTERED INTO
IN THE STATE OF COLORADO AND SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF COLORADO.
c. The Borrowers represent and warrant to the Bank that the execution and
delivery of this Second Amendment to Credit Agreement and the
performance by the Borrowers of their obligations hereunder are within
the Borrowers' powers, have been duly authorized by all necessary
corporate action, and will not contravene or conflict with any provision
of law or of the articles or bylaws of the Borrowers, or of any
agreement binding upon the Borrowers.
d. The Borrowers represent and warrant to the Bank that all of the
representations and warranties of the Borrowers contained in the Credit
Agreement, as amended by this Second Amendment to Credit Agreement, are
true and correct in all material respects on the date hereof as though
made as of the date hereof; provided, however, that any reference to the
Credit Agreement shall be deemed to refer to the Credit Agreement as
previously amended and as amended by this Second Amendment to Credit
Agreement.
e. All references to the Credit Agreement in any other document,
instrument, agreement or writing shall hereafter be deemed to refer to
the Credit Agreement as previously amended and as amended by this Second
Amendment to Credit Agreement.
f. This Second Amendment to Credit Agreement may be executed in any number
of counterparts, each of which shall be deemed an original and all of
which are
2
identical, and all such counterparts shall together constitute but one
and the same Second Amendment to Credit Agreement.
IN WITNESS WHEREOF, the Borrowers and the Bank have executed this Second
Amendment to Credit Agreement effective as of April 1, 1996.
BORROWERS:
---------
BONNEVILLE FUELS CORPORATION BONNEVILLE FUELS OPERATING
CORPORATION
By: _________________________ By: ___________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
BONNEVILLE FUELS MARKETING CORPORATION
By: _________________________
Xxxxxx X. Xxxxxxxx, President
COLORADO GATHERING CORPORATION BONNEVILLE FUELS OPERATING
CORPORATION
By: _________________________ By: ___________________________
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
BANK:
----
FIRST INTERSTATE BANK OF DENVER, N.A.
By: _________________________
Xxxx X. Xxxxxxxx, Vice President
3
LOAN TRANSFER AGREEMENT
-----------------------
THIS LOAN TRANSFER AGREEMENT (this "Agreement"), dated as of September 18,
1996, is by and among BONNEVILLE FUELS CORPORATION, BONNEVILLE FUELS MARKETING
CORPORATION, COLORADO GATHERING CORPORATION, BONNEVILLE FUELS OPERATING
CORPORATION, and BONNEVILLE FUELS MANAGEMENT CORPORATION (collectively,
"Borrower"), XXXXX FARGO BANK (COLORADO), N.A., a national banking association,
f/k/a FIRST INTERSTATE BANK OF DENVER, N.A. ("Xxxxx Fargo"), and COLORADO
NATIONAL BANK ("CNB").
RECITALS
A. Pursuant to the provisions of an Amended and Restated Credit Agreement
dated as of May 31, 1994, as amended by amendments dated as of April 1, 1995 and
April, 1996 (such Credit Agreement, as amended, together with all prior credit
agreements and amendments thereto which were amended and restated thereby, being
herein collectively called the "Xxxxx Fargo Credit Agreement"), Xxxxx Fargo made
two loans (the "Loans") to Borrower.
B. Borrower, Xxxxx Fargo and CNB wish to enter into this Agreement in
order to provide for the terms upon which the Loans, the Xxxxx Fargo Credit
Agreement, any and all related notes and all other related loan documents,
including without limitation any and all related security documents, are being
transferred from Xxxxx Fargo to CNB.
AGREEMENT
NOW THEREFORE, in consideration of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Purchase Price. If the purchase of the Loans is to occur on September
18, 1996, CNB will wire-transfer to Xxxxx Fargo on that date, as consideration
for the purchase by CNB of the Loans, $2,509,606.16 (the "9/18 Purchase Price"),
representing $2,500,000.00 of principal and $9,606.16 of interest outstanding on
the Loans as of that date (wiring instructions: Xxxxx Fargo Bank, N.A., ABA
#000-000-000, Credit GL Account #2712-507201, Ref: Bonneville Fuels, Obligor
#0944220986, Obligation: 42, 18, 83). The consideration to be paid by CNB to
Xxxxx Fargo for the purchase of the Loans (the "Final Purchase Price") shall be
the 9/18/ Purchase Price plus, if the purchase of the Loans is delayed beyond
September 18, 1996, $565.06849 for each day after September 18, 1996 until the
day that the appropriate amount is wire-transferred to Xxxxx Fargo; provided
that if the purchase is not made on or before September 30, 1996, this Agreement
shall terminate and be of no further force or effect.
2. Loan Documents. Effective as of the date of the receipt by Xxxxx Fargo
of the Final Purchase Price from CNB ( the "Assignment Date") and conditional
upon its receipt of such amount on or before September 30, 1996, Xxxxx Fargo
agrees to transfer, and does hereby transfer (conditional upon the receipt by
Xxxxx Fargo of such amount), to CNB, WITHOUT RECOURSE, REPRESENTATION OR
WARRANTY (except that Xxxxx Fargo represents and warrants that it has not
heretofore transferred any interest in the Loans or in any related documents to
any third party), the Loans, the Xxxxx Fargo Credit Agreement, the related notes
and all other related loan documents, including without limitation the security
documents listed on Exhibit A attached hereto and made a part hereof and any and
all other security documents securing the Loans (collectively, the "Loan
Documents").
3. Delivery of Loan Documents. Upon its receipt of the Final Purchase
Price, Xxxxx Fargo will deliver to CNB (or as CNB may direct) all loan documents
relating to the Loans, including without limitation: (a) any and all original
promissory notes, endorsed to the order of CNB, without recourse, by Xxxxx
Fargo, (b) appropriate assignments, in recordable form, of any and all security
documents securing the Loans, and (c) the original recorded counterparts of
mortgages, acknowledgment copies of financing statements and any and all other
security documents, to the extent possessed by or on behalf of Xxxxx Fargo.
4. Further Assurances. Upon and after the receipt by Xxxxx Fargo of the
final Purchase Price, Xxxxx Fargo agrees to promptly do or cause to be done such
further acts and to execute such further instruments as CNB may reasonably
request in order to carry out the purposes of this Agreement.
5. Expenses. Borrower shall pay any and all reasonable out-of-pocket
expenses incurred by Xxxxx Fargo and/or CNB in connection with the transactions
contemplated by this Agreement, including without limitation any and all filing
and recording fees, charges and expenses.
6. Assumption. CNB will, from and after the Assignment Date, perform all
of the obligations of Xxxxx Fargo under or in connection with the Loan
Documents. From and after the Assignment Date: (a) Xxxxx Fargo shall be released
from the obligations of Xxxxx Fargo in respect of the Loan documents, and (b)
CNB shall be entitled to all of the rights, powers and privileges of Xxxxx Fargo
under the Loan Documents.
7. Disclaimer. Xxxxx Fargo does not make any representation or warranty,
nor shall it have any responsibility to CNB, with respect to the accuracy of any
recitals, statements, representations or warranties contained in the Loan
Documents or in any certificate or other document referred to or provided for
in, or received by Xxxxx Fargo under, the Loan Documents, or for legality,
enforceability, collectibility or sufficiency of the Loan Documents or any other
document referred to or provided for therein or for any failure by Borrower or
any other person or entity to perform any of its obligations there under or for
the existence, value, perfection or priority of any collateral security or the
financial or other condition of Borrower, or any other matter relating to the
Loan Documents or any extension of credit thereunder.
8. Release. Borrower forever releases Xxxxx Fargo and each of its
directors, officers, employees, agents, affiliates, successors and assigns
(except CNB) from and against any and all claims, covenants, promises,
agreements, obligations, controversies, losses, damages, costs, expenses,
demands, causes of action, judgments or liabilities of any kind or character
whatsoever, whether matured or contingent or known or unknown, that such party
may have arising out of, or with respect to, directly or indirectly, the Loan
documents and the transactions covered thereunder (including, but not limited
to, Xxxxx Fargo's commitments and obligations under the Loan Documents).
9. Letters of Credit. As to any and all letters of credit issued by Xxxxx
Fargo and currently outstanding under the Loan Documents (the "Xxxxx Fargo
LC's"), CNB will promptly issue substitute letters of credit and Borrower will
promptly thereafter obtain cancellations of the Xxxxx Fargo LC's from the
beneficiaries thereof. Until such cancellations are obtained, Borrower and CNB
will indemnify, save and hold harmless Xxxxx Fargo from any and all obligations
to make payments under the Xxxxx Fargo LC's and Borrower will at all times
maintain: (a) a certificate of deposit issued by Xxxxx Fargo and pledged to
Xxxxx Fargo in an amount at least equal to the aggregate of the face amounts of
any and all Xxxxx Fargo LC's, or (b) alternative security arrangements
acceptable to Xxxxx Fargo as to Borrower's obligations with respect to the Xxxxx
Fargo LC's. CNB agrees that the interests of Xxxxx Fargo in and to
2
such certificate of deposit or alternative security under any such documents
shall be superior to any claim or right that CNB may have to such certificate of
deposit or alternative security under any of the security documents being
assigned to CNB.
10. Miscellaneous. This Agreement shall be governed by and construed
under the laws of the State of Colorado and shall be binding upon and inure to
the benefit of the parties hereto and their successors and assigns. This
Agreement may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall constitute one instrument. Delivery
of this Agreement by any party may be effected, without limitation, by faxing a
signed counterpart of this Agreement to Borrower, Xxxxx Fargo and CNB (any party
that effects delivery in such manner hereby agreeing to transmit promptly to
each of the other parties an actual signed counterpart):
Borrower: 000-000-0000 (Attn: Xxxxxx X. Xxxxxxxx)
Xxxxx Fargo: 000-000-0000 (Attn: Xx. X. Xxxxx Rheem, Jr.)
CNB: 000-000-0000 (Attn: Mr. Xxxx Xxxxxxxx)
Executed as of the date first above written.
XXXXX FARGO BANK (COLORADO), N.A.
f/k/a FIRST INTERSTATE BANK OF
DENVER, N.A.
By:____________________________________
Vice President
BONNEVILLE FUELS CORPORATION
By:____________________________________
President
BONNEVILLE FUELS MARKETING CORPORATION
By:____________________________________
President
3
COLORADO GATHERING CORPORATION
By:______________________________
President
BONNEVILLE FUELS OPERATING CORPORATION
By:______________________________
President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By:______________________________
President
COLORADO NATIONAL BANK
By:______________________________
4
Exhibit A
---------
Security Documents
------------------
1. Amended and Restated Mortgage, Deed of Trust, Assignment of Proceeds,
Security Agreement and Financing Statement dated as of May 31, 1994, from
Bonneville Fuels Corporation to Xxxxx X. Xxxxxxxx, as trustee, and First
Interstate Bank of Denver, N.A.
2. Amended and Restated Mortgage, Deed of Trust, Assignment of Proceeds,
Security Agreement and Financing Statement dated as of May 31, 1994, from
Bonneville Fuels Corporation to Xxxxxxx X. Xxxxxx, as trustee, and First
Interstate Bank of Denver, N.A.
3. Amended and Restated Mortgage, Assignment of Proceeds, Security
Agreement and Financing Statement dated as of May 31, 1994, from Bonneville
Fuels Corporation to First Interstate Bank of Denver, N.A.
4. Amended and Restated Mortgage, Assignment of Proceeds, Security
Agreement and Financing Statement dated as of May 31, 1994, from Colorado
Gathering Corporation to First Interstate Bank of Denver, N.A.
5. Second Amended and Restated Assignment and Security Agreement dated as
of May 31, 1994, from Bonneville Fuels Corporation to First Interstate Bank of
Denver, N.A.
6. Financing Statements relating to Items 1 through 5 above.
THIRD AMENDMENT OF
AMENDED AND RESTATED CREDIT AGREEMENT
THIS THIRD AMENDMENT OF AMENDED AND RESTATED CREDIT AGREEMENT (this
"Amendment"), dated as of September 18, 1996, is by and among BONNEVILLE FUELS
CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a
Utah corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation, BONNEVILLE FUELS MANAGEMENT
CORPORATION, a Utah corporation (collectively, "Borrower"), and COLORADO
NATIONAL BANK ("CNB")
Recitals
A. Borrower and First Interstate Bank of Denver, N.A. ("FIDN") entered
into an Amended and Restated Credit Agreement dated as of May 31, 1994, as
amended by amendments dated as of April 1, 1995 and April 1, 1996 (the "Credit
Agreement"). Capitalized terms used herein but not defined herein shall have the
same meanings as set forth in the Credit Agreement.
B. Pursuant to a Loan Transfer Agreement dated as of September 18, 1996,
the Credit Agreement has been transferred by FIDN to CNB.
C. Borrower and CNB wish to enter into this Amendment in order to amend
certain terms and provisions of the Credit Agreement.
Amendment
NOW, THEREFORE, in consideration of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Credit Agreement. The Credit Agreement shall be, and hereby is,
amended as follows as of the date hereof:
(a) All references in the Credit Agreement to "First Interstate Bank
of Denver, N.A." or the "Bank" shall be deemed to refer to Colorado National
Bank.
(b) In line 7 of the definition of "Conversion Date" in Section 1.1
on page 4 of the Credit Agreement, "April 1, 1998" shall be changed to "July 1,
1998."
(c) In line 2 of the definition of "Facility A Scheduled Maturity
Date" in Section 1.1 on page 6 of the Credit Agreement, "April 1, 2001" shall be
changed to "July 1, 2003."
(d) In line 3 of the definition of "Facility B Maturity Date" in
Section 1.1 on page 6 of the Credit Agreement, "May 1, 1998" shall be changed to
"July 1, 1998."
(e) In lines 2 and 3 of the definition of "LIBOR Loan Interest Rate"
in Section 1.1 on page 8 of the Credit Agreement, "prior to the Conversion Date"
shall be deleted. In line 4 of the definition of "LIBOR Loan Interest Rate" in
Section 1.1 on page 8 of the Credit Agreement, clause (a) shall be revised to
read as follows: "(z)(1) during the Revolving Period, 1.75 percentage points,
and (2) during the Amortizing Period, 2.00 percentage points."
(f) All references in the Credit Agreement to "Prime Rate," "Prime
Rate Loan" and "Prime Rate Loan Interest Rate" (including without limitation the
definitions of the foregoing terms) shall be changed to refer to "Reference
Rate," "Reference Rate Loan" and "Reference Rate Loan interest Rate,"
respectively.
(g) The following shall be substituted for the definition of "Prime
Rate Loan Interest Rate" in Section 1.1 on page 10 of the Credit Agreement:
"Reference Rate Loan Interest Rate" means the interest rate per
annum pertaining to a Reference Rate Loan, which interest rate shall
be, for Reference Rate Loans under Facility A and for Reference Rate
Loans under Facility B, the Reference Rate in effect from time to
time.
(h) In line 11 of Section 2.3 on page 12 of the Credit Agreement,
"October 1, 1995" shall be changed to "January 1, 1999."
(i) In line 8 of Section 3.3 on page 15 of the Credit Agreement,
"May 1, 1996" shall be changed to "August 1, 1998." In lines 12 and 13 of
Section 3.3 on page 15 of the Credit Agreement, "economic half-life" shall be
changed to "revenue half-life."
(j) In lines 4 and 5 of Section 3.6(a) on page 16 of the Credit
Agreement, "633 Seventeenth Street" shall be changed to "950 Seventeenth
Street."
(k) In line 4 of Section 3.6(b) on page 16 of the Credit Agreement,
"365" shall be changed to "360."
(l) The following shall be inserted at the end of Section 4.1(a) on
page 18 of the Credit Agreement: "During each of the time periods set forth
below, the amount of the Production Borrowing Base for Facility A shall be as
set forth below:
2
Production
Time Period Borrowing Base
----------- --------------
09/18/96-09/30/96 $5,100,000
10/01/96-10/31/96 $4,900,000
11/01/96-11/30/96 $4,700,000
12/01/96-12/31/96 $4,500,000"
(m) In line 4 of Section 4.2 on page 18 of the Credit Agreement,
"April 1, commencing April 1, 1995" shall be changed to "July 1, commencing July
1, 1997."
(n) In lines 7 and 8 of Section 4.2 on page 18 of the Credit
Agreement, "October 1" shall be changed to "January 1, commencing January 1,
1997."
(o) In line 11 of Section 4.2 on page 18 of the Credit Agreement,
"April 1" shall be changed to "July 1."
(p) The following shall be substituted for Section 8.1 (e) on page 33
of the Credit Agreement:
(e) Financial Covenants. Comply, on a consolidated basis, as of
the end of each Quarter, beginning June 30, 1996, with the following
financial tests, all determined in accordance with generally accepted
accounting principles:
Minimum Working Capital (1): $250,000
Minimum Current Ratio (1): 1.05x
Minimum Net Worth (2): $2,300,000
Minimum Net Worth (3): $5,900,000
Maximum Debt/Worth (2): 6.00x
Maximum Debt/Worth (3): 2.00x
Minimum Fixed Charge Coverage (2): l.00x
(1) With the current portion of Facility A treated as a non-current
liability, and with the unused portion of Facility A treated as a
current asset.
(2) With advances from BPC ($3,600,000 currently) treated as a
liability.
(3) With advances from BPC ($3,600,000 currently) treated as an
equity.
3
(4) (i) Net income after tax plus interest expense plus depreciation,
depletion and amortization plus other non-cash charges, divided
by (ii) interest expenses plus required principal payments,
calculated on a fiscal year-to-date basis.
(q) The following shall be substituted for Section 9.1(h) on page 40
of the Credit Agreement:
(h) Material Adverse Change. A material adverse change in any of
Borrowers' condition (financial or otherwise), including changes due
to violations of Environmental Laws or applications of Environmental
Laws to the Borrowers or their properties, which the Bank determines,
in its sole discretion, would have a Materially Adverse Effect on the
operations of the Borrowers.
(r) The following shall be substituted for the address of the Bank in
Section 10.2 on page 43 of the Credit Agreement:
Bank: Colorado National Bank
000 Xxxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxxxx,
Energy Group
Facsimile: (000) 000-0000
2. The Notes. The Facility A Note, the Facility B Note and the Term Note
shall be amended, such amendments to be effected by Allonges (the "Allonges"),
between Borrower and CNB, to be attached to the Facility A Note, the Facility B
Note and the Term Note, respectively, and to be substantially in the form of
Exhibits X-0, X-0 and A-3 attached hereto and made a part hereof.
3. Loan Documents. All references in any document to the Credit
Agreement, the Facility A Note, the Facility B Note or the Term Note shall refer
to the Credit Agreement, the Facility A Note, the Facility B Note or the Term
Note, as amended pursuant to this Amendment and the Allonges.
4. Conditions Precedent. The obligations of the parties under this
Amendment are subject, at the option of CNB, to the prior satisfaction of the
condition that Borrower shall have delivered to CNB the following (all documents
to be satisfactory in form and substance to CNB and, if appropriate, duly
executed and/or acknowledged on behalf of the parties other than CNB):
(a) This Amendment.
4
(b) The Allonges.
(c) Any and all other loan documents required by CNB, including
without limitation such amendments and supplements to the Collateral Documents
as may be required by CNB.
(d) Such title opinions, supplemental title opinions, UCC searches
and other title information concerning Borrower's title to the Collateral or any
portions thereof as may be satisfactory to CNB.
5. Representations and Warranties. Borrower hereby certifies to CNB
that, as of the date of this Amendment, all of Borrower's representations and
warranties contained in the Credit Agreement are true, accurate and complete in
all material respects, no Event of Default has occurred and no event has
occurred which, with the giving of notice, the lapse of time, or both, would
constitute an Event of Default.
6. Continuation of the Credit Agreement. Except as specified in this
Amendment and the Allonges, the provisions of the Credit Agreement, the Facility
A Note, the Facility B Note and the Term Note shall remain in full force and
effect, and if there is a conflict between the terms of this Amendment or the
Allonges and those of the Credit Agreement, the Facility A Note, the Facility B
Note or the Term Note or any other document executed and delivered in connection
therewith, the terms of this Amendment and the Allonges shall control.
7. Miscellaneous. This Amendment shall be governed by and construed
under the laws of the State of Colorado and shall be binding upon and inure to
the benefit of the parties hereto and their successors and assigns. This
Amendment may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall constitute one instrument.
Executed as of the date first above written.
BONNEVILLE FUELS CORPORATION
By: _______________________________________
President
BONNEVILLE FUELS MARKETING CORPORATION
By: _______________________________________
President
5
COLORADO GATHERING CORPORATION
By: ___________________________________
President
BONNEVILLE FUELS OPERATING CORPORATION
By: ___________________________________
President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By: ___________________________________
President
COLORADO NATIONAL BANK
By: ___________________________________
Vice President
6
Exhibit A-1
Allonge
Reference is made to the Third Amendment of Amended and Restated Credit
Agreement dated as of September 18, 1996 (the "Amendment"), by and among
BONNEVILLE FUELS CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING
CORPORATION, a Utah corporation, COLORADO GATHERING CORPORATION, a Utah
corporation, BONNEVILLE FUELS OPERATING CORPORATION, a Utah corporation,
BONNEVILLE FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively,
"Borrower"), and COLORADO NATIONAL BANK ("CNB").
The Revolving Note dated May 31, 1994, made by Borrower payable to the
order of First Interstate Bank of Denver, N.A., in the face amount of
$20,000,000 (the "Revolving Note") is hereby modified as follows:
1. All references in the Revolving Note to "First Interstate Bank of
Denver, N.A." or the "Bank" shall be deemed to refer to Colorado National Bank.
2. In lines 2 and 3 of the third paragraph on page 1 of the Revolving
Note, "633 Seventeenth Street" shall be changed to "950 Seventeenth Street."
3. All references in the Revolving Note to the "Credit Agreement" shall
be deemed to refer to the Amended and Restated Credit Agreement dated as of May
31, 1994, between Borrower and First Interstate Bank of Denver, N.A., as
assigned by Xxxxx Fargo Bank (Colorado), N.A. f/k/a First Interstate Bank of
Denver, N.A. to Colorado National Bank, as heretofore or hereafter amended,
extended, modified, or amended and restated.
Executed as of the date first above written.
BONNEVILLE FUELS CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS MARKETING CORPORATION
By:
------------------------------
President
A-1-1
COLORADO GATHERING CORPORATION
By:
---------------------------------
President
BONNEVILLE FUELS OPERATING
CORPORATION
By:
---------------------------------
President
BONNEVILLE FUELS MANAGEMENT
CORPORATION
By:
---------------------------------
President
COLORADO NATIONAL BANK
By:
---------------------------------
Vice President
A-1-2
Exhibit A-2
Allonge
Reference is made to the Third Amendment of Amended and Restated Credit
Agreement dated as of September 18, 1996 (the "Amendment"), by and among
BONNEVILLE FUELS CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING
CORPORATION, a Utah corporation, COLORADO GATHERING CORPORATION, a Utah
corporation, BONNEVILLE FUELS OPERATING CORPORATION, a Utah corporation,
BONNEVILLE FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively,
"Borrower"), and COLORADO NATIONAL BANK ("CNB").
The Promissory Note dated May 31, 1994, made by Borrower, payable to the
order of First Interstate Bank of Denver, N.A., in the face amount of $1,000,000
(the "Facility B Note") is hereby modified as follows:
1. All references in the Facility B Note to "First Interstate Bank of
Denver, N.A.," the "Bank" or "Holder" shall be deemed to refer to Colorado
National Bank.
2. In line 4 of the first paragraph on page 1 of the Facility B Note,
"633 Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000" shall be changed to "950
Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000."
3. In line 8 of the first paragraph on page 1 of the Facility B Note,
"which is one percent (1%) per annum higher than the `Bank's Prime Rate'" shall
be changed to "equal to the `Bank's Reference Rate.'"
4. In line 10 of the first paragraph on page 1 of the Facility B Note,
"three Hundred sixty-five (365)" shall be changed to "three hundred sixty
(360)."
5. All references in the Facility B Note to "Bank's Prime Rate" shall be
changed to be references to "Bank's Reference Rate."
6. In line 3 of the first paragraph on page 2 of the Facility B Note, the
maturity date of the Facility B Note shall be changed to July 1, 1998.
7. All references in the Facility B Note to the "Credit Agreement" shall
be deemed to refer to the Amended and Restated Credit Agreement dated as of May
31, 1994, between Borrower and First Interstate Bank of Denver, N.A., as
assigned by Xxxxx Fargo Bank (Colorado), N.A. f/k/a First Interstate Bank of
Denver, N.A. to Colorado National Bank, as heretofore or hereafter amended,
extended, modified, or amended and restated.
Executed as of the date first above written.
A-2-1
BONNEVILLE FUELS CORPORATION
By:
--------------------------------
President
BONNEVILLE FUELS MARKETING CORPORATION
By:
--------------------------------
President
COLORADO GATHERING CORPORATION
By:
--------------------------------
President
BONNEVILLE FUELS OPERATING
CORPORATION
By:
--------------------------------
President
BONNEVILLE FUELS MANAGEMENT
CORPORATION
By:
--------------------------------
President
COLORADO NATIONAL BANK
By:
--------------------------------
Vice President
A-2-2
Exhibit a-3
Allonge
Reference is made to the Third Amendment of Amended and Restated Credit
Agreement dated as of September 18, 1996 (the "Amendment"), by and among
BONNEVILLE FUELS CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING
CORPORATION, a Utah corporation, COLORADO GATHERING CORPORATION, a Utah
corporation, BONNEVILLE FUELS OPERATING CORPORATION, a Utah corporation,
BONNEVILLE FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively,
"Borrower"), and COLORADO NATIONAL BANK ("CNB").
The Term Note dated May 31, 1994, made by Borrower, payable to the order of
First Interstate Bank of Denver, N.A., in the face amount of $20,000,000 (the
"Term Note") is hereby modified as follows:
1. All references in the Term Note to "First Interstate Bank of Denver,
N.A." or the "Bank" shall be deemed to refer to Colorado National Bank.
2. In lines 2 and 3 of the third paragraph on page 1 of the Term Note,
"633 Seventeenth Street" shall be changed to "950 Seventeenth Street."
3. All references in the Term Note to the "Credit Agreement" shall be
deemed to refer to the Amended and Restated Credit Agreement dated as of May 31,
1994, between Borrower and First Interstate Bank of Denver, N.A., as assigned by
Xxxxx Fargo Bank (Colorado), N.A. f/k/a First Interstate Bank of Denver, N.A. to
Colorado National Bank, as heretofore or hereafter amended, extended, modified,
or amended and restated.
Executed as of the date first above written.
BONNEVILLE FUELS CORPORATION
By:
--------------------------------
President
BONNEVILLE FUELS MARKETING
CORPORATION
By:
--------------------------------
President
A-3-1
COLORADO GATHERING CORPORATION
By: -------------------------------------
President
BONNEVILLE FUELS OPERATING CORPORATION
By: -------------------------------------
President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By: -------------------------------------
President
COLORADO NATIONAL BANK
By: -------------------------------------
Vice President
26002202_1.DOC
A-3-2
FOURTH AMENDMENT OF
AMENDED AND RESTATED CREDIT AGREEMENT
THIS FOURTH AMENDMENT OF AMENDED AND RESTATED CREDIT AGREEMENT (this
"Amendment"), dated as of May 15, 1998, is by and among BONNEVILLE FUELS
CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a
Utah corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation, BONNEVILLE FUELS MANAGEMENT
CORPORATION, a Utah corporation (collectively, "Borrower"), and u.s. sang
NATIONAL ASSOCIATION, a national banking association ("USA"), f/k/a COLORADO
NATIONAL BANK, a national banking association ("CNB").
RECITALS
A. Borrower and First Interstate Bank of Denver, N.A. ("FIDN") entered
into an Amended and Restated Credit Agreement dated as of May 31, 1994, as
amended by amendments dated as of April 1, 1995 and April 1, 1996 (the "FIDN
Credit Agreement").
B. Pursuant to a Loan Transfer Agreement dated as of September 18, 1996,
the FIDN Credit Agreement was transferred by FIDN's successor to CNB. Pursuant
to a Third Amendment of Amended and Restated Credit Agreement dated as of
September 18, 1996, the FIDN Credit Agreement was further amended. The FIDN
Credit Agreement, as so assigned and amended, is herein called the "Credit
Agreement."
C. USB is the successor to CNB.
D. Borrower and USB wish to enter into this Amendment in order to amend
certain terms and provisions of the Credit Agreement.
AMENDMENT
NOW, THEREFORE, in consideration of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Credit Agreement. The Credit Agreement shall be, and hereby is,
amended as follows, effective as of the date of this Amendment:
(a) All references in the Credit Agreement to "Colorado National
Bank" shall be changed to be references to "U.S. Bank National Association."
(b) In line 3 of the definition of "Accounts Receivable Report" in
Section 1.1 on page 2 of the Credit Agreement and in lines 3 and 5 of the
definition of "Facility B Commitment" in Section 1.1 on page 6 of the Credit
Agreement, "BFMC and BFM Corp." shall be changed to "any of the Borrowers."
(c) In line 7 of the definition of "Conversion Date" in Section 1.1
on page 4 of the Credit Agreement, "July 1, 1998" shall be changed to "July 1,
2001."
(d) In line 2 of the definition of "Facility A Scheduled Maturity
Date" in Section 1.1 on page 6 of the Credit Agreement, "July 1, 2003" shall be
changed to "July 1, 2006."
(e) In line 3 of the definition of "Facility B Maturity Date" in
Section 1.1 on page 6 of the Credit Agreement, "July 1, 1998" shall be changed
to "July 1, 1999."
(f) In lines 2 and 3 of the definition of "Maximum Credit Amount" in
Section 1.1 on page 9 of the Credit Agreement, the maximum amount specified for
Facility B in clause (ii) shall be changed to "One Million Five Hundred Thousand
Dollars ($1,500,000)."
(g) In line 11 of Section 2.3 on page 12 of the Credit Agreement,
"January 1, 1999" shall be changed to "January 1, 2000."
(h) The following shall be substituted for the last sentence of
Section 2.6 on page 13 of the Credit Agreement:
Any election to terminate the Commitment or reduce the Maximum
Credit Amount shall be irrevocable, except as otherwise provided in
Sections 4.2 and 4.4 below.
(i) In line B of Section 3.3 on page 15 of the Credit Agreement,
"August 1, l998" shall be changed to "August 1, 2001."
(j) In lines 4 and 5 of Section 3.6(a) on page 16 of the Credit
Agreement, "950 Seventeenth Street" shall be changed to "918 Seventeenth
Street."
(k) The following shall be substituted for the second sentence of
Section 3.1(c) on page 14 of the Credit Agreement: "The Letter of Credit Fee
will be payable concurrently with the issuance of each Letter of Credit;
provided that, if any Letter of Credit is terminated or released prior to its
expiry date, the Letter of Credit Fee determined as set forth in the prior
sentence shall be recalculated based upon the actual term of the Letter of
Credit, and, if such recalculation results in a lesser Letter of Credit Fee, the
Bank shall refund to Borrower the excess of the amount originally paid over the
recalculated amount."
(l) The following shall be substituted for Section 4.2 on pages 18
and l9 of the Credit Agreement:
Section 4.2 Production Borrowing Base Determinations. The
Production Borrowing Base under Facility A shall be redetermined (a)
during the Revolving
2
Period by the Bank as of (i) each July 1, commencing July 1, 1997
(based upon the Bank's evaluation of annual independent engineering
reports to be provided to the Bank by the Borrowers as more fully
described in Section 4.5(a)) and (ii) each January 1, commencing
January 1, l997 (based upon the Bank's evaluation of the Borrowers'
actual production, revenue and expense data to be provided to the Bank
by the Borrowers as more fully described in Section 4.5(b)) and (b)
during the Amortizing Period by the Bank as of each July 1 (based upon
the aforementioned independent engineering reports) and (c) otherwise
may be redetermined by the Bank from time to time during the terms of
this Agreement at the Bank's option and in the sole discretion of the
Bank in accordance with the Bank's standard parameters for making oil
and gas production based loans in effect at the time of such
redetermination, together with such adjustments as the Bank determines
to be appropriate, in its sole discretion reasonably exercised, to
reflect the impact on the value of such properties of breaches of
Environmental Laws, if any, by the Borrowers or their predecessors in
ownership of any of the Mortgaged Properties and (d) so long as the
Borrowers have not previously elected to reduce the Production
Borrowing Base as described below since the previous regular
redetermination of the Production Borrowing Base pursuant to clause
(a) or (b) above (or only with the prior written consent of the Bank,
if the Borrowers have previously so elected to reduce the Production
Borrowing Base), upon the request of the Borrowers by written notice
to the Bank, not more than once during each time period between two
consecutive regular redeterminations of the Production Borrowing Base
pursuant to clauses (a) and (b) above. Any increase in the Production
Borrowing Base above $11,500,000 shall require prior written approval
of the Bank's credit committees, which may be given or withheld in the
Bank's sole discretion. The Bank shall notify the Borrowers of each
change in the Production Borrowing Base under Facility A and the
amount set forth in such notice shall be the amount of the Production
Borrowing Base for all purposes of this Agreement until notice of a
new Production Borrowing Base is given by the Bank to the Borrowers;
provided, however, that the Borrowers may, by written notice to the
Bank, not more than once during each time period between two
consecutive regular redeterminations of the Production Borrowing Base
pursuant to clauses (a) and (b) above, reduce the amount of the
3
Production Borrowing Base from the amount set forth in the Bank's
notice to the Borrowers to any lesser amount which is equal to or in
excess of the aggregate Principal Amount of Facility A Loans and the
Face Amount of Letters of Credit issued under Facility A. Any notice
given by the Borrowers to reduce the Production Borrowing Base, shall
be effective two (2) Business Days following the receipt of such
notice by the Bank, and the amount set forth in such notice shall be
the amount of the Production Borrowing Base for all purposes of this
Agreement until notice of a new Production Borrowing Base is given by
the Bank to the Borrowers. However, if the Production Borrowing Base
is reduced by the Borrowers pursuant to this Section 4.2, so long as
no Event of Default has occurred and is continuing, the Borrowers may,
not more than once during each time period between two consecutive
regular redeterminations of the Production Borrowing Base pursuant to
clauses (a) and (b) above, upon two (2) Business Days' prior written
notice given to the Bank, increase the Production Borrowing Base up to
the amount originally specified in the Bank's notice to the Borrowers
on which such reduction was based. Such notice of increase must be
accompanied by payment to the Bank of an amount equal to the Borrowing
Base Commitment Fees specified in Section 3.1(b) which would have
accrued and been invoiced by the Bank on the amount of the increase to
the date of reinstatement if the amount of such increase had been
included within the Production Borrowing Base at all times from the
date of the Bank's notice to the Borrowers. Any such amounts which are
payable by the Borrowers but which would not have been invoiced by the
Bank shall be payable at the next scheduled invoice for Borrowing Base
Commitment Fees.
(m) In line 6 of the first paragraph of Section 4.4 on page 20 of the
Credit Agreement, "BFMC's and BFM Corp.'s" shall be changed to "Borrowers.'" In
line 2 of the second paragraph of Section 4.4 on page 20 of the Credit
Agreement, "BFMC and BFM Corp." shall be changed to "Borrowers."
(n) The following shall be inserted as a new third paragraph of
Section 4.4, immediately after the second paragraph of Section 4.4 on page 21 of
the Credit Agreement:
The Borrowers may, by written notice to the Bank, reduce the
Maximum Credit Amount for Facility B to any lesser amount which is
equal to or in excess of the aggregate Principal Amount of Facility B
Loans and the Face Amount
4
of Letters of Credit issued under Facility B. Any notice given by the
Borrowers to reduce the Maximum Credit Amount for Facility B shall be
effective two (2) Business Days following the receipt of such notice
by the Bank, and the amount set forth in such notice shall be the
Maximum Credit Amount for Facility B. However, if the Maximum Credit
Amount for Facility B is reduced by the Borrowers pursuant to this
Section 4.4, so long as no Event of Default has occurred and is
continuing, the Borrowers may, not more than once prior to the
Facility B Maturity Date, upon two (2) Business Days' prior written
notice given to the Bank, increase the Maximum Credit Amount for
Facility B up to $1,500,000. Such notice of increase must be
accompanied by payment to the Bank of an amount equal to the Borrowing
Base Commitment Fees specified in Section 3.1(b) which would have
accrued and been invoiced by the Bank on the amount of the increase to
the date of reinstatement if the amount of such increase had been
included within the Maximum Credit Amount for Facility B at all times
from the effective date of the reduction by Borrowers. Any such
amounts which are payable by the Borrowers but which would not have
been previously invoiced by the Bank shall be payable at the next
scheduled invoice for Borrowing Base Commitment Fees.
(o) The following shall be substituted for Section 8.1(e) on page 33
of the Credit Agreement:
(e) Financial Covenants. Comply, on a consolidated basis, as of
the end of each Quarter, beginning June 30, 1998, with the following
financial tests, all determined in accordance with generally accepted
accounting principles:
Minimum Working Capital (1): $250,000
Minimum Current Ratio (1): 1.05x
Minimum Net Worth: $8,000,000
Maximum Debt/Worth: 2.00x
Minimum Fixed Charge Coverage (2): 1.00x
(1) With the current portion of Facility A treated as a non-current
liability, and with the unused portion of Facility A treated as a
current asset.
(2) (i) Net income after tax plus interest expense plus depreciation,
depletion and amortization plus other non-
5
cash charges, divided by (ii) interest expenses plus required
principal payments, calculated on a fiscal year-to-date basis.
(p) The parenthetical expression in lines 3 through 5 of Section
8.2(1) on page 39 of the Credit Agreement shall be deleted.
(q) Section 9.1(j) on page 41 of the Credit Agreement shall be
deleted.
(r) Borrower's suite number, as set forth in the address of Borrower
in Section 10.2 on page 42 of the Credit Agreement, shall be changed to "Suite
2200."
(s) The following shall be substituted for the address of the Bank in
Section 10.2 on page 43 of the Credit Agreement:
Bank: U.S. Bank National Association
000 Xxxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxxxx,
Energy Group
Facsimile: (000) 000-0000
2. The Notes. The Facility A Note, the Facility B Note and the Term Note
shall be amended, such amendments to be effected by Allonges (the "Allonges"),
among Borrower and USB, to be attached to the Facility A Note, the Facility B
Note and the Term Note, respectively, and to be substantially in the form of
Exhibits X-0, X-0 and A-3 attached hereto and made a part hereof.
3. Loan Documents. All references in any document to the Credit
Agreement, the Facility A Note, the Facility B Note or the Term Note shall refer
to the Credit Agreement, the Facility A Note, the Facility B Note or the Term
Note, as amended pursuant to this Amendment and the Allonges.
4. Conditions Precedent. The obligations of the parties under this
Amendment are subject, at the option of USB, to the prior satisfaction of the
condition that Borrower shall have delivered to USB the following (all documents
to be satisfactory in form and substance to USB and, if appropriate, duly
executed and/or acknowledged on behalf of the parties other than USB):
(a) This Amendment.
(b) The Allonges.
(c) Any and all other loan documents required by USB, including
without limitation such amendments and supplements to the Collateral Documents
as may be required by USB.
6
(d) Such title opinions, supplemental title opinions, UCC searches
and other title information concerning Borrower's title to the Collateral or any
portions thereof as may be satisfactory to USB.
5. Representations and Warranties. Borrower hereby certifies to USB
that, as of the date of this Amendment, all of Borrower's representations and
warranties contained in the Credit Agreement are true, accurate and complete in
all material respects, no Event of Default has occurred and no event has
occurred which, with the giving of notice, the lapse of time, or both, would
constitute an Event of Default.
6. Continuation of the Credit Agreement. Except as specified in this
Amendment and the Allonges, the provisions of the Credit Agreement, the Facility
A Note, the Facility B Note and the Term Note shall remain in full force and
effect, and if there is a conflict between the terms of this Amendment or the
Allonges and those of the Credit Agreement, the Facility A Note, the Facility B
Note or the Term Note or any other document executed and delivered in connection
therewith, the terms of this Amendment and the Allonges shall control.
7. Miscellaneous. This Amendment shall be governed by and construed
under the laws of the State of Colorado and shall be binding upon and inure to
the benefit of the parties hereto and their successors and assigns. This
Amendment may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall constitute one instrument.
EXECUTED as of the date first above written.
BONNEVILLE FUELS CORPORATION
By: _______________________________________
President
BONNEVILLE FUELS MARKETING CORPORATION
By: _______________________________________
President
COLORADO GATHERING CORPORATION
By: _______________________________________
President
7
BONNEVILLE FUELS OPERATING CORPORATION
By: ________________________________________
President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By: ________________________________________
President
U.S. BANK NATIONAL ASSOCIATION f/k/a
COLORADO NATIONAL BANK
By: ________________________________________
Vice President
8
Exhibit A-1
Allonge
Reference is made to the Third Amendment of Amended and Restated Credit
Agreement dated as of May 15, 1998 (the "Amendment"), by and among BONNEVILLE
FUELS CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING
CORPORATION, a Utah corporation, COLORADO GATHERING CORPORATION, a Utah
corporation, BONNEVILLE FUELS OPERATING CORPORATION, a Utah corporation,
BONNEVILLE FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively,
"Borrower"), and U.S. BANK NATIONAL ASSOCIATION, a national banking association
("USA"), f/k/a COLORADO NATIONAL BANK ("CNB").
The Revolving Note dated May 31, 1994, as amended, made by Borrower,
payable to the order of CNB, in the face amount of $20,000,000 (the "Revolving
Note") is hereby modified as follows:
1. All references in the Revolving Note to Colorado National Bank or the
"Bank" shall be deemed to refer to U.S. Bank National Association.
2. In lines 2 and 3 of the third paragraph on page 1 of the Revolving
Note, "950 Seventeenth Street" shall be changed to "918 Xxxxxxxxxxx Xxxxxx."
Executed as of the date first above written
BONNEVILLE FUELS CORPORATION
By: _____________________________________
President
BONNEVILLE FUELS MARKETING CORPORATION
By: _____________________________________
President
COLORADO GATHERING CORPORATION
By: _____________________________________
President
A-1-1
BONNEVILLE FUELS OPERATING CORPORATION
By: ________________________________________
President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By: ________________________________________
President
U.S. BANK NATIONAL ASSOCIATION f/k/a
COLORADO NATIONAL BANK
By: ________________________________________
Vice President
A-1-2
Exhibit A-2
Allonge
Reference is made to the Third Amendment of Amended and Restated Credit
Agreement dated as of May 15, 1998 (the "Amendment"), by and among BONNEVILLE
FUELS CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING
CORPORATION, a Utah corporation, COLORADO GATHERING CORPORATION, a Utah
corporation, BONNEVILLE FUELS OPERATING CORPORATION, a Utah corporation,
BONNEVILLE FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively,
"Borrower"), and U.S. BANK NATIONAL ASSOCIATION, a national banking association
("USA"), f/k/a COLORADO NATIONAL BANK ("CNB").
The Promissory Note dated May 31, 1994, as amended, made by Borrower,
payable to the order of CNB, in the face amount of $1,000,000 (the "Facility B
Note") is hereby modified as follows:
1. All references in the Facility B Note to Colorado National Bank, the
"Bank" or "Holder" shall be deemed to refer to U.S. Bank National Association.
2. In the caption of the Facility B Note and in lines 5 and 6 of the
first paragraph on page 1 of the Facility B Note, the face amount of the
Facility B Note shall be increased to $1,500,000.
3. In line 4 of the first paragraph on page 1 of the Facility B Note,
"950 Seventeenth Street" shall be changed to "918 Seventeenth Street."
4. In line 3 of the first paragraph on page 2 of the Facility B Note, the
maturity date of the Facility B Note shall be changed to July 1, 1999.
Executed as of the date first above written.
BONNEVILLE FUELS CORPORATION
By: ______________________________________
President
BONNEVILLE FUELS MARKETING CORPORATION
By: ______________________________________
President
A-2-1
COLORADO GATHERING CORPORATION
By: _______________________________________
President
BONNEVILLE FUELS OPERATING CORPORATION
By: _______________________________________
President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By: _______________________________________
President
COLORADO NATIONAL BANK
By: _______________________________________
Vice President
A-2-2
Exhibit A-3
Allonge
Reference is made to the Third Amendment of Amended and Restated Credit
Agreement dated as of May 15, 1998 (the "Amendment"), by and among BONNEVILLE
FUELS CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING
CORPORATION, a Utah corporation, COLORADO GATHERING CORPORATION, a Utah
corporation, BONNEVILLE FUELS OPERATING CORPORATION, a Utah corporation,
BONNEVILLE FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively,
"Borrower"), and U.S. BANK NATIONAL ASSOCIATION, a national banking association
("USA"), f/k/a COLORADO NATIONAL BANK ("CNB").
The Term Note dated May 31, 1994, as amended, made by Borrower, payable to
the order of CNB, in the face amount of $20,000,000 (the term Note") is hereby
modified as follows:
1. All references in the Term Note to Colorado National Bank or the
"Bank" shall be deemed to refer to U.S. Bank National Association.
2. In lines 2 and 3 of the third paragraph on page 1 of the Term Note,
"950 Seventeenth Street" shall be changed to "918 Xxxxxxxxxxx Xxxxxx."
Executed as of the date first above written.
BONNEVILLE FUELS CORPORATION
By: _______________________________________
President
BONNEVILLE FUELS MARKETING CORPORATION
By: _______________________________________
President
COLORADO GATHERING CORPORATION
By: _______________________________________
President
A-3-1
BONNEVILLE FUELS OPERATING CORPORATION
By: _______________________________________
President
BONNEVILLE FUELS MANAGEMENT CORPORATION
By: _______________________________________
President
U.S. BANK NATIONAL ASSOCIATION f/k/a
COLORADO NATIONAL BANK
By: _______________________________________
Vice President
A-3-2
FIFTH AMENDMENT OF AMENDED AND
RESTATED CREDIT AGREEMENT
THIS FIFTH AMENDMENT OF AMENDED AND RESTATED CREDIT AGREEMENT (this
"Amendment"), dated as of May 15, 1998, is by and among BONNEVILLE FUELS
CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a
Utah corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation, BONNEVILLE FUELS MANAGEMENT
CORPORATION, a Utah corporation (collectively, "Borrower"), and U.S. BANK
NATIONAL ASSOCIATION, a national banking association ("USB"), f/k/a COLORADO
NATIONAL BANK, a national banking association ("CNB").
RECITALS
A. Borrower and USB are parties to an Amended and Restated Credit
Agreement dated as of May 31, 1994, as amended by amendments dated as of April
1, 1995, April 1, 1996, September 18, 1996 and May 15, 1998 (the "Credit
Agreement").
B. Borrower and USB wish to enter into this Amendment in order to amend
certain terms and provisions of the Credit Agreement.
AMENDMENT
NOW, THEREFORE, in consideration of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Credit Agreement. The Credit Agreement shall be, and hereby is,
amended as follows, effective as of the date of this Amendment:
a. In line 3 of the definition of "Facility B Maturity Date" in
Section 1.1 on page 6 of the Credit Agreement, "July 1, l999" shall be changed
to "July 1, 2001".
b. In line 11 of Section 2.3 on page 12 of the Credit Agreement,
"January 1, 2000" shall be changed to "January 1, 2002".
c. The Production Borrowing Base under Facility A shall be
$11,400,000 for the time period from June 1, 1999 until the effectiveness of the
January 1, 2000 redetermination thereof pursuant to Section 4.2 of the Credit
Agreement, unless the Production Borrowing Base under Facility A is redetermined
prior to such date in accordance with the provisions of the Credit Agreement.
2. The Facility B Note. The Facility B Note shall be amended, such
amendment to be effected by an Allonge (the "Allonge"), among Borrower and USB,
to
be attached to the Facility B Note and to be substantially in the form of
Exhibit A attached hereto and made a part hereof.
3. Loan Documents. All references in any document to the Credit Agreement
or the Facility B Note shall refer to the Credit Agreement or the Facility B
Note, as amended pursuant to this Amendment and the Allonge.
4. Conditions Precedent. The obligations of the parties under this
Amendment are subject, at the option of USB, to the prior satisfaction of the
condition that Borrower shall have delivered to USA the following (all documents
to be satisfactory in form and substance to USB and, if appropriate, duly
executed and/or acknowledged on behalf of the parties other than USB):
a. This Amendment.
b. The Allonge.
c. Any and all other loan documents required by USB, including
without limitation such amendments and supplements to the Collateral Documents
as may be required by USB.
d. Such title opinions, supplemental title opinions, UCC searches
and other title information concerning Borrower's title to the Collateral or any
portions thereof as may be satisfactory to USB.
5. Representations and Warranties. Borrower hereby certifies to USB that,
as of the date of this Amendment, all of Borrower's representations and
warranties contained in the Credit Agreement are true, accurate and complete in
all material respects, no Event of Default has occurred and no event has
occurred which, with the giving of notice, the lapse of time, or both, would
constitute an Event of Default.
6. Continuation of the Credit Agreement. Except as specified in this
Amendment and the Allonge, the provisions of the Credit Agreement and the
Facility B Note shall remain in full force and effect, and if there is a
conflict between the terms of this Amendment or the Allonge and those of the
Credit Agreement or the Facility B Note or any other document executed and
delivered in connection therewith, the terms of this Amendment and the Allonge
shall control.
7. Miscellaneous. This Amendment shall be governed by and construed under
the laws of the State of Colorado and shall be binding upon and inure to the
benefit of the parties hereto and their successors and assigns. This Amendment
may be executed in any number of counterparts, each of which shall be an
original, but all of which together shall constitute one instrument.
2
EXECUTED as of the date first above written.
BONNEVILLE FUELS CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS MARKETING
CORPORATION
By:
-----------------------------
President
COLORADO GATHERING CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS OPERATING
CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS MANAGEMENT
CORPORATION
By:
---------------------------
President
U.S. BANK NATIONAL ASSOCIATION f/k/a
COLORADO NATIONAL BANK
By:
-----------------------------
President
3
EXHIBIT A
ALLONGE
Reference is made to the Fifth Amendment of Amended and Restated Credit
Agreement dated as of June 1, 1999 (the "Amendment"), by and among BONNEVILLE
FUELS CORPORATION, a Colorado corporation, BONNEVILLE FUELS MARKETING
CORPORATION, a Utah corporation, COLORADO GATHERING CORPORATION, a Utah
corporation, BONNEVILLE FUELS OPERATING CORPORATION, a Utah corporation,
BONNEVILLE FUELS MANAGEMENT CORPORATION, a Utah corporation (collectively,
"Borrower"), and U.S. BANK NATIONAL ASSOCIATION, a national banking association
("USB"), f/k/a COLORADO NATIONAL BANK ("CNB").
The Promissory Note dated May 31, 1994, as amended, made by Borrower,
payable to the order of CNB, in the original face amount of $1,000,000,
subsequently increased to $1,500,000 (the "Facility B Note"), is hereby modified
by substituting July 1, 2001 for July 1, 1999 as the maturity date of the
Facility B Note in line 3 of the first paragraph on page 2 of the Facility B
Note.
EXECUTED as of June 1, 1999.
BONNEVILLE FUELS CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS MARKETING CORPORATION
By:
-----------------------------
President
COLORADO GATHERING CORPORATION
By:
-----------------------------
President
4
BONNEVILLE FUELS OPERATING
CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS MANAGEMENT
CORPORATION
By:
-----------------------------
President
U.S. BANK NATIONAL ASSOCIATION f/k/a
COLORADO NATIONAL BANK
By:
-----------------------------
Vice President
5
U.S. Bank National Association
000 - 00xx Xxxxxx
Xxxxxx, XX 00000
Re: Year 2000 Compliance
Dear Sir/Madam:
As a condition to the extension or continuation of credit to the undersigned
(the "Borrower") by you (the "Bank") under each existing or any contemplated
credit agreement between Borrower and Bank and each related promissory note,
Bank has required Borrower to make the following representations and agreements
upon which Bank will rely.
The Borrower has reviewed and assessed its business operations and computer
systems and applications to address the "year 2000 problem" (that is, that
computer applications and equipment used by the Borrower, directly or indirectly
through third parties, may be unable to properly perform date-sensitive
functions before, during and after January 1, 2000). The Borrower reasonably
believes that the year 2000 problem will not result in a material adverse change
in the Borrower's business condition (financial or otherwise), operations,
properties or prospects or ability to repay any indebtedness due to Bank.
The Borrower agrees that this representation will be true and correct on each
date the Borrower requests a loan or advance or delivers information to the
Bank.
In addition to the events of default in any of Borrower's agreements with Bank,
it will be an event of default under each such agreement if (a) any
representation in this letter is false or misleading when made, or becomes false
or misleading at any time thereafter; (b) Borrower fails to perform or comply
with any term, condition or obligation set forth herein; or (c) there is any
material adverse change in Borrower's business condition (financial or
otherwise), operations, prospects or ability to repay Bank which relates to or
results from the year 2000 problem.
The Borrower agrees to promptly deliver to Bank such information relating to
this representation as Bank may request from time to time.
Sincerely,
Bonneville Fuels Corporation Bonneville Fuels Marketing Corporation
By: By:
--------------------------- -----------------------------
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
Colorado Gathering Corporation Bonneville Fuels Operating Corporation
6
By: By:
------------------------------ -----------------------------
Xxxxxx X. Xxxxxxxx, President Xxxxxx X. Xxxxxxxx, President
Bonneville Fuels Management Corporation Date:
------------------------
By:
------------------------------
Xxxxxx X. Xxxxxxxx, President
7
Allonge
Reference is made to the Fifth Amendment Restated Credit Agreement dated as
of June 1, 1999 (the "Amendment"), by and among BONNEVILLE FUELS CORPORATION, a
Colorado corporation, BONNEVILLE FUELS MARKETING CORPORATION, a Utah
corporation, COLORADO GATHERING CORPORATION, a Utah corporation, BONNEVILLE
FUELS OPERATING CORPORATION, a Utah corporation, BONNEVILLE FUELS MANAGEMENT
CORPORATION, a Utah corporation (collectively, "Borrower"), and U.S. BANK
NATIONAL ASSOCIATION, a national banking association ("USB"), f/k/a COLORADO
NATIONAL BANK ("CNB").
The Promissory Note dated May 31, 1994, as amended, made by Borrower,
payable to the order of CNB, in the original face amount of $1,000,000,
subsequently increased to $1,500,000 (the "Facility B Note"), is hereby modified
by substituting July 1, 2001 for July 1, 1999 as the maturity date of the
Facility B Note in line 3 of the first paragraph on page 3 of the Facility B
Note.
EXECUTED as of June 1, 1999.
BONNEVILLE FUELS CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS MARKETING CORPORATION
By:
-----------------------------
President
COLORADO GATHERING CORPORATION
By:
-----------------------------
President
BONNEVILLE FUELS OPERATING CORPORATION
By:
-----------------------------
President
8
BONNEVILLE FUELS MANAGEMENT
CORPORATION
By:
-----------------------------
President
U.S. BANK NATIONAL ASSOCIATION f/k/a
COLORADO NATIONAL BANK
By:
-----------------------------
President
9
