FOURTEENTH AMENDMENT TO CREDIT AGREEMENT
Exhibit 10.1
FOURTEENTH AMENDMENT TO CREDIT AGREEMENT
FOURTEENTH AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) dated as of October 21,
2010, by and among CARRIZO OIL & GAS, INC., a Texas corporation (“Borrower”), certain
SUBSIDIARIES OF BORROWER, as Guarantors (in such capacity, “Guarantors”), the LENDERS party
hereto (the “Lenders”), and XXXXX FARGO BANK, N.A., as administrative agent for the Lenders
(in such capacity, the “Administrative Agent”). Unless otherwise expressly defined herein,
capitalized terms used but not defined in this Amendment have the meanings assigned to such terms
in the Credit Agreement (as defined below).
WITNESSETH:
WHEREAS, Borrower, Guarantors, Administrative Agent and Lenders are party to that certain
Credit Agreement, dated as of May 25, 2006 (as the same has been and may hereafter be amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”);
and
WHEREAS, Borrower, Guarantors, Administrative Agent and Lenders have agreed to amend the
Credit Agreement as provided herein subject to the terms and conditions set forth herein.
NOW, THEREFORE, for and in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged and confessed, the parties hereto hereby agree as follows:
SECTION 1. Amendments to Credit Agreement. Subject to the satisfaction or waiver in writing of
each condition precedent set forth in Section 2 of this Amendment, and in reliance on the
representations, warranties, covenants and agreements contained in this Amendment, the Credit
Agreement shall be amended in the manner provided in this Section 1.
1.1 Amended Definitions. The following definitions in Section 1.01 of the Credit
Agreement shall be and they hereby are amended and restated in their respective entireties to read
as follows:
“Consolidated EBITDAX” means the Borrower’s consolidated earnings
determined in accordance with GAAP (excluding earnings of Unrestricted Subsidiaries)
before interest expense, income taxes, depreciation, amortization, depletion, oil
and gas asset impairment write downs, lease impairment expense, gains and losses
from the sale of capital assets, and other non-cash charges. For purposes of
calculating Consolidated EBITDAX, Consolidated EBITDAX shall not include (a) the
non-cash effects of (i) the early extinguishment of long-term debt, (ii) CCBM’s
equity investment in Pinnacle and (iii) any stock option re-pricing expenses, (b)
the income (or deficit) of any Person that is not a Subsidiary in which the Borrower
or any of its Restricted Subsidiaries has an Equity Interest, except to the extent
of the amount of dividends or other distributions actually paid to the Borrower or
any of its Restricted Subsidiaries (it being understood that any cash distributions
received by the Borrower or any of its Restricted Subsidiaries in respect of its
profit interests in Avista JV Partner shall be included in the
Fourteenth Amendment to Credit Agreement — Page 1
calculation of Consolidated EBITDAX for any period of determination to the
extent such cash distributions were so received during such period), (c) the income
(or deficit) of any Restricted Subsidiary in which any other Person (other than the
Borrower or any of its Restricted Subsidiaries) has an Equity Interest, except to
the extent that the declaration or payment of dividends or similar distributions by
such Restricted Subsidiary is not prohibited by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to such Restricted Subsidiary, and (d) any
portion of the consolidated earnings of Marcellus Holdings that is allocated or
remitted to Avista or Avista JV Partner in accordance with the Xxxxxxxxx XX
Participation Agreement or the Xxxxxxxxx XX Operating Agreement. For purposes of
determining the Borrower’s compliance with Section 7.12(b), Consolidated EBITDAX
shall not include any net revenue attributable to any assets that are subject to a
Lien granted to secure Non-Recourse Debt.
“Convertible Notes” means the 4.375% Convertible Senior Notes due 2028
of the Borrower issued on May 28, 2008 pursuant to and in accordance with the terms
of the Convertible Notes Indenture.
“Convertible Notes Documents” means the Convertible Notes, the
Convertible Notes Indenture, and any other documents, instruments and agreements
evidencing or otherwise pertaining to the Convertible Notes, in each case, as
amended, restated, modified or supplemented from time to time (to the extent such
amendment, restatement, modification or supplement is applicable to the Convertible
Notes) in accordance with the terms of this Agreement.
“Convertible Notes Indenture” means that certain Senior Indenture dated
as of May 28, 2008 among the Borrower, as issuer, certain Subsidiaries of the
Borrower, as potential subsidiary guarantors, and Xxxxx Fargo Bank, National
Association, as trustee (the “Trustee”), as supplemented by that certain
First Supplemental Indenture dated as of May 28, 2008 between the Borrower and the
Trustee, and as supplemented by that certain Second Supplemental Indenture dated as
of May 14, 2009 among the Borrower, certain Subsidiaries of the Borrower named
therein and the Trustee, and as the same may be amended, restated, modified or
further supplemented from time to time (to the extent such amendment, restatement,
modification or supplement is applicable to the Convertible Notes) in accordance
with the terms of this Agreement.
“Material Indebtedness” means the (a) so long as the outstanding
principal amount of such Indebtedness is equal to or greater than $5,000,000, the
Senior Notes, (b) so long as the outstanding principal amount of such Indebtedness
is equal to or greater than $5,000,000, the Convertible Notes, and (c) any other
Indebtedness (other than the Loans and Letters of Credit), or obligations in respect
of one or more Swap Agreements, of the Borrower or any one or more of the Restricted
Subsidiaries in an aggregate principal amount exceeding $5,000,000. For purposes of
determining Material Indebtedness, the “principal amount” of the obligations of the
Borrower or any Guarantor in
Fourteenth Amendment to Credit Agreement — Page 2
respect of any Swap Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that the Borrower or such Guarantor would
be required to pay if such Swap Agreement were terminated at such time.
“Permitted Refinancing” means any Indebtedness of the Borrower, and
Indebtedness constituting Guarantees thereof by Restricted Subsidiaries, incurred or
issued in exchange for, or the net proceeds of which are used solely to extend,
refinance, renew, replace (whether or not contemporaneously), defease or refund,
other Indebtedness of the Borrower, in whole or in part, from time to time;
provided that (a) the principal amount of such Permitted Refinancing (or if
such Permitted Refinancing is issued at a discount, the initial issuance price of
such Permitted Refinancing) does not exceed the principal amount of the Indebtedness
so extended, refinanced, renewed, replaced, defeased or refunded (plus the amount of
any premiums paid and fees and expenses incurred in connection therewith), (b) such
Permitted Refinancing does not provide for any scheduled repayment, mandatory
redemption or payment of a sinking fund obligation prior to the date that is one
year after the Maturity Date (as in effect on the date of incurrence of such
Permitted Refinancing), except for any offer to redeem or repurchase such Permitted
Refinancing required as a result of the occurrence of a change of control or an
asset sale, (c) such Permitted Refinancing is unsecured, (d) the non-default
interest rate on the outstanding principal balance of such Permitted Refinancing
does not exceed 12% per annum, (e) no Subsidiary of the Borrower Guarantees such
Permitted Refinancing unless such Subsidiary is (or concurrently with any such
Guarantee becomes) a Guarantor hereunder, (f) the covenant, default and remedy
provisions of such Permitted Refinancing are not materially more onerous to the
Borrower and its Restricted Subsidiaries than those imposed by the Indebtedness so
exchanged, extended, refinanced, renewed, replaced, defeased or refunded, (g) the
mandatory prepayment, repurchase and redemption provisions of such Permitted
Refinancing are not materially more onerous to the Borrower and its Restricted
Subsidiaries than those imposed by the Indebtedness so exchanged, extended,
refinanced, renewed, replaced, defeased or refunded, and (h) to the extent such
Permitted Refinancing is expressly subordinate to the payment in full of all of the
Obligations, the subordination provisions contained therein are reasonably
satisfactory to the Administrative Agent and the Required Lenders.
“Senior Debt” means, on any date of determination, the Borrower’s
consolidated Indebtedness on such date less (a) the amount of unrestricted cash and
cash equivalents on hand of the Borrower and the Guarantors as of such date, (b) any
Non-Recourse Debt, (c) any Indebtedness of any Unrestricted Subsidiary, (d) any
Indebtedness of the Borrower or any Restricted Subsidiary under any Convertible
Notes (or any Permitted Refinancing thereof) or Senior Notes (or any Permitted
Refinancing thereof), and (e) any other unsecured Indebtedness of the Borrower or
any Restricted Subsidiary to the extent permitted under Section 7.01(l).
Fourteenth Amendment to Credit Agreement — Page 3
“Total Net Debt” means, on any date of determination, the Borrower’s
consolidated Indebtedness on such date less the amount of unrestricted cash and cash
equivalents on hand of the Borrower and the Guarantors as of such date. For
purposes of this definition and for determining the Borrower’s compliance with
Section 7.12(b), the Borrower’s consolidated Indebtedness shall not include (a)
Non-Recourse Debt, (b) Indebtedness of any Unrestricted Subsidiary, and (c) for each
date of determination during any period set forth below, an amount equal to (i) the
amount set forth below opposite such period as the equity component of the
Borrower’s Convertible Notes pursuant to FASB Staff Position (“FSB”) Accounting
Principles Board (“APB”) 14-1 multiplied by (ii) a fraction, (x) the
numerator of which is equal to the aggregate outstanding principal amount of
Indebtedness of the Borrower under the Convertible Notes on such date of
determination and (y) the denominator of which is equal to $373,750,000:
| Period | Equity Component | |||
1/1/2010 –12/31/2010 |
$ | 38,874,756 | ||
1/1/2011 –12/31/2011 |
$ | 26,021,425 | ||
1/1/2012 –10/29/2012 |
$ | 12,674,753 | ||
“Unrestricted Subsidiary” means (a) any Subsidiary that at the time of
determination shall be designated an Unrestricted Subsidiary by the Board of
Directors of the Borrower in the manner provided below and (b) any Subsidiary of an
Unrestricted Subsidiary. The Board of Directors of the Borrower may at any time and
from time to time designate any Subsidiary (including any newly acquired or newly
formed Subsidiary but excluding any Subsidiary that (1) owns or operates Oil and Gas
Interests included in the Borrowing Base Properties or other interests of the type
described in clauses (d) or (e) of the definition of Oil and Gas Interests relating
to any Borrowing Base Properties or (2) guarantees, or is a primary obligor in
respect of, any Convertible Notes or Senior Notes) to be an Unrestricted Subsidiary;
provided that (i) no Default has occurred and is continuing at the time of such
designation and after giving effect to such designation, (ii) immediately after such
designation, no Credit Party has any obligation to pay any Indebtedness of such
Subsidiary, has in any way guaranteed any Indebtedness of such Subsidiary, or has
any assets or properties (excluding a pledge of the Equity Interests in such
Subsidiary) which are subject to any Lien securing any Indebtedness of such
Subsidiary, and (iii) notice of any such designation is promptly given to the
Administrative Agent in writing.
1.2 Additional Definitions. The following definitions shall be and they hereby are added to
Section 1.01 of the Credit Agreement in appropriate alphabetical order:
“Convertible Notes Repurchase Date” means the date that all or any
portion of the Convertible Notes are repurchased pursuant to the Convertible Notes
Tender Offer.
Fourteenth Amendment to Credit Agreement — Page 4
“Convertible Notes Tender Offer” means an offer made by the Borrower to
repurchase up to $373,750,000 of aggregate principal amount of the Convertible
Notes, as such offer may be amended or extended from time to time, or any renewal of
such offer if the original offer is terminated or expires without the full amount of
Convertible Notes having been purchased under such original offer; provided
that at least $200,000,000 in gross cash proceeds are received from the purchasers
of the Senior Notes on or prior to the Convertible Notes Repurchase Date and the
Convertible Notes Repurchase Date occurs on or before December 15, 2010 (or such
later date approved by the Required Lenders).
“Draft Description of Notes” means that certain draft Description of
Notes relating to a proposed issuance of senior notes by the Borrower provided to
the Administrative Agent and the Lenders on or about October 14, 2010.
“Exchange Offer” means a registered offer to exchange outstanding
Senior Notes for new Senior Notes (the “Exchange Notes”) having terms substantially
identical in all material respects to such outstanding Senior Notes (except that the
Exchange Notes shall not contain any transfer restrictions).
“Fourteenth Amendment Effective Date” means October 21, 2010.
“Senior Notes” means any senior or senior subordinated notes issued by
the Borrower in one or more transactions on or before December 15, 2010 (it being
understood that it shall not be necessary for any Senior Notes issued pursuant to an
Exchange Offer to be issued on or before December 15, 2010); provided that
(a) the terms and conditions applicable to such notes are not materially more
onerous to the Borrower and its Restricted Subsidiaries than those set forth in the
Draft Description of Notes, (b) such notes are unsecured, (c) the non-default
interest rate on the outstanding principal balance of such notes does not exceed 12%
per annum, (d) such notes do not provide for any scheduled repayment, mandatory
redemption (including any required offer to redeem) or payment of a sinking fund
obligation prior to the date that is one year after the Maturity Date, except for
any offer to redeem or repurchase such notes required as a result of the occurrence
of a change of control or an asset sale, (e) no Subsidiary of the Borrower
Guarantees the Indebtedness evidenced by such notes unless such Subsidiary is (or
concurrently with any such Guarantee becomes) a Guarantor hereunder, and (f) with
respect to any senior subordinated notes, such notes are expressly subordinate to
the payment in full of all of the Obligations on terms and conditions reasonably
satisfactory to the Administrative Agent.
“Senior Notes Documents” means the Senior Notes, the indenture pursuant
to which the Senior Notes are issued, and any other documents, instruments and
agreements evidencing or otherwise pertaining to the Senior Notes, in each case, as
amended, restated, modified or supplemented from time to time (to the extent such
amendment, restatement, modification or supplement is applicable to the Senior
Notes) in accordance with the terms of this Agreement.
Fourteenth Amendment to Credit Agreement — Page 5
“Senior Notes Issuance Date” means the date Senior Notes are initially
issued pursuant to and in accordance with the Senior Notes Indenture.
1.3 Deleted Definitions. Section 1.01 of the Credit Agreement shall be and it hereby
is amended by deleting the definition of “Draft Preliminary Prospectus Supplement”.
1.4 Mandatory Prepayment of Loans. Section 2.10 of the Credit Agreement shall be and
it hereby is amended by (a) re-lettering clause (d) as clause (e) and (b) adding a new clause (d)
to read as follows:
(d) Upon the issuance of any Senior Notes, the Borrower shall prepay the Loans
with the cash proceeds (net of underwriting discounts and commissions, investment
banking fees, legal, accounting and other professional fees and expenses, taxes, and
other usual and customary transaction costs associated therewith) received as a
result of the issuance of such Senior Notes within one (1) Business Day of the date
on which it receives such net cash proceeds.
1.5 Borrowing Base Reduction On the Convertible Notes Repurchase Date. Clause (c) of
Section 3.05 of the Credit Agreement shall be and it hereby is amended and restated in its
entirety to read as follows:
(c) As of the Convertible Notes Repurchase Date, the Borrowing Base then in
effect shall be reduced by an amount equal to 25% of the difference between (i) the
aggregate principal amount of Senior Notes issued after the Fourteenth Amendment
Effective Date and on or prior to the Convertible Notes Repurchase Date and (ii) the
aggregate principal amount of the Convertible Notes purchased by the Borrower
pursuant to the Convertible Notes Tender Offer.
1.6 Borrowing Base Reduction After the Convertible Notes Repurchase Date. The following
shall be and it hereby is added to the end of Section 3.05 of the Credit Agreement as
clause (d) thereto:
(d) Unless otherwise waived in writing by the Required Lenders, upon the
issuance of any Senior Notes in accordance with Section 7.01(k) after the
Convertible Notes Repurchase Date (other than Permitted Refinancings of any such
Senior Notes), the Borrowing Base then in effect shall be reduced by $1.00 for every
$4.00 of Senior Notes issued after the Convertible Notes Repurchase Date. For the
avoidance of doubt, the principal amount of such Indebtedness that constitutes
Permitted Refinancings of existing Senior Notes shall not be included for purposes
of determining the reduction in the Borrowing Base required by this Section 3.05(d)
and only the principal amount in excess of such Permitted Refinancings shall be
included in calculating the adjustment required by this Section 3.05(d).
1.7 Indebtedness. Clause (k) of Section 7.01 of the Credit Agreement shall be and it
hereby is amended and restated in its entirety to read as follows:
Fourteenth Amendment to Credit Agreement — Page 6
(k) unsecured Indebtedness of the Borrower under the Convertible Notes and the
Senior Notes (and any Permitted Refinancing thereof), including any Indebtedness
constituting Guarantees thereof by any Credit Party, in an aggregate principal
amount not to exceed (i) at any time prior to the Senior Notes Issuance Date,
$373,750,000, and (ii) at any time on and after the Senior Notes Issuance Date, an
amount equal to (A) the lesser of (1) $798,750,000 and (2) the sum of (I) the
aggregate principal amount of Senior Notes issued on or before December 15, 2010
plus (II) $373,750,000, minus (B), without duplication, (1) the
aggregate principal amount of Convertible Notes repurchased on the Convertible Notes
Repurchase Date, (2) the aggregate principal amount of all repayments, prepayments,
redemptions and repurchases of the Senior Notes (other than pursuant to an Exchange
Offer) and the Convertible Notes to the extent permitted under the terms of this
Agreement and (3) the aggregate principal amount of any Convertible Notes converted
into Equity Interests of the Borrower in accordance with the terms of the
Convertible Notes Documents; provided that at the time of and immediately
after giving effect to each issuance of Convertible Notes and Senior Notes (and any
Permitted Refinancing thereof), no Default shall have occurred and be continuing;
and
1.8 Restricted Payments. Section 7.07 of the Credit Agreement shall be and it hereby
is amended and restated in its entirety to read as follows:
Section 7.07. Restricted Payments. The Borrower will not, nor will it
permit any of its Restricted Subsidiaries to, declare or make, or agree to pay or
make, directly or indirectly, any Restricted Payment, except that (a) the Borrower
may declare and pay dividends with respect to its Equity Interests payable solely in
additional shares of its common stock, (b) any Restricted Subsidiary may make
Restricted Payments to the Borrower or any Guarantor, (c) the Borrower may make cash
payments in lieu of issuing fractional shares in an aggregate amount not exceeding
$200,000 during the term of this Agreement, (d) the Borrower may declare and pay
distributions effecting “poison pill” rights plans provided that any securities or
rights so distributed have a nominal fair market value at the time of declaration,
(e) the Borrower may make any mandatory or optional cash payments or deliveries of
the Borrower’s capital stock, or any combination thereof, in settlement of its
obligations under any Convertible Notes Documents upon the conversion or required
repurchase of any Convertible Notes thereunder, (f) the Borrower may repurchase up
to $373,750,000 of aggregate principal amount of the Convertible Notes pursuant to
the Convertible Notes Tender Offer, and (g) the Borrower may make repurchases,
redemptions or other acquisitions or retirements for value of its Equity Interests
(i) deemed to occur upon the exercise of stock options or other rights to acquire
Equity Interests of Borrower if such Equity Interests represent a portion of the
exercise or exchange price thereof or (ii) to the extent of any withholding tax
liability incurred as a result of any exercise, vesting, grant or exchange of Equity
Interests of Borrower issued under any incentive plan adopted by the holders of its
Equity Interests, in accordance with such incentive plan; provided that (A)
at the time of such repurchase, redemption or other acquisition or retirement for
value, no Default has occurred
Fourteenth Amendment to Credit Agreement — Page 7
and is continuing or would be caused by such Restricted Payment and (B) such
withholding tax is remitted to the appropriate governmental authority within thirty
(30) days after such repurchase, redemption or other acquisition or retirement for
value.
1.9 Restrictive Agreements. Section 7.09 of the Credit Agreement shall be and it
hereby is amended and restated in its entirety to read as follows:
Section 7.09. Restrictive Agreements. The Borrower will not, nor will
it permit any of its Restricted Subsidiaries to, directly or indirectly, enter into,
incur or permit to exist any agreement or other arrangement that prohibits,
restricts or imposes any condition upon (a) the ability of the Borrower or any
Restricted Subsidiary to create, incur or permit to exist any Lien upon any of its
property or assets (other than property or assets consisting of (1) Equity Interests
in any Unrestricted Subsidiary, (2) Equity Interests of joint ventures permitted
under Section 7.05(o), 7.05(p) or 7.05(q), (3) investments permitted under Section
7.05(j) if such restriction or conditions apply only to the property or assets that
are the subject of such investment and (4) unless the value of such Equity Interests
are included in the determination of the Borrowing Base, Equity Interests in
Pinnacle permitted under Section 7.05(l), and (5) profit interests in Avista JV
Partner permitted under Section 7.05(r)), or (b) the ability of any Restricted
Subsidiary to pay dividends or other distributions with respect to any of its Equity
Interests or to make or repay loans or advances to the Borrower or any Restricted
Subsidiary or to Guarantee Indebtedness of the Borrower or any Restricted
Subsidiary; provided that (i) the foregoing shall not apply to restrictions
and conditions imposed by law or by this Agreement, (ii) the foregoing shall not
apply to restrictions and conditions set forth in the Convertible Notes Documents or
the Senior Notes Documents, (iii) the foregoing shall not apply to restrictions and
conditions existing on the date hereof identified on Schedule 7.09 (but shall apply
to any extension or renewal of, or any amendment or modification expanding the scope
of, any such restriction or condition), (iv) clause (a) of the foregoing shall not
apply to restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions apply
only to the property or assets securing such Indebtedness, (v) clause (a) of the
foregoing shall not apply to customary provisions in leases and other contracts
restricting the assignment thereof (other than oil, gas and mineral leases
constituting Mortgaged Properties), (vi) the foregoing shall not apply to existing
restrictions with respect to a Person acquired by the Borrower or any of its
Restricted Subsidiaries (except to the extent such restrictions were put in place in
connection with or in contemplation of such acquisition), which restrictions are not
applicable to any Person, or the properties or assets of any Person, other than the
Person, or the property or assets of the Person, so acquired; and (vii) the
foregoing shall not apply to any restriction with respect to Equity Interests of a
Restricted Subsidiary imposed pursuant to an agreement entered into for the sale or
disposition of such Equity Interests or any restriction with respect to the assets
of a Credit Party imposed pursuant to an agreement entered into for the sale or
Fourteenth Amendment to Credit Agreement — Page 8
disposition of such assets or all or substantially all the Equity Interests of
such Restricted Subsidiary pending the closing of such sale or disposition.
1.10 Financial Covenants. Clauses (b) and (c) of Section 7.12 of the Credit
Agreement shall be and they hereby are amended and restated in their entirety to read as follows:
(b) Leverage Ratio.
(i) The Borrower will not permit the ratio, determined as of the end of
the fiscal quarter ending September 30, 2010, of (A) Total Net Debt as of
the end of such fiscal quarter to (B) Consolidated EBITDAX for the trailing
four fiscal quarter period ending on such date, to be greater than 4.75 to
1.00.
(ii) The Borrower will not permit the ratio, determined as of the end
of each fiscal quarter ending on or after December 31, 2010 and on or before
June 30, 2011, of (A) Total Net Debt as of the end of such fiscal quarter to
(B) Consolidated EBITDAX for the trailing four fiscal quarter period ending
on such date, to be greater than 4.25 to 1.00; provided that the Borrower
shall not permit such ratio to be greater than 4.00 to 1.00 for each fiscal
quarter ending on or after March 31, 2011 and on or before June 30, 2011, in
the event the Senior Notes Issuance Date does not occur on or before
December 15, 2010.
(iii) The Borrower will not permit the ratio, determined as of the end
of each fiscal quarter ending on or after September 30, 2011 and on or
before December 31, 2011, of (A) Total Net Debt as of the end of such fiscal
quarter to (B) Consolidated EBITDAX for the trailing four fiscal quarter
period ending on such date, to be greater than 4.50 to 1.00; provided that
the Borrower shall not permit such ratio to be greater than 4.00 to 1.00 for
the fiscal quarters ending on or after September 30, 2011 in the event the
Senior Notes Issuance Date does not occur on or before December 15, 2010.
(iv) The Borrower will not permit the ratio, determined as of the end
of each fiscal quarter ending on or after March 31, 2012, of (A) Total Net
Debt as of the end of such fiscal quarter to (B) Consolidated EBITDAX for
the trailing four fiscal quarter period ending on such date, to be greater
than 4.00 to 1.00.
(c) Senior Debt Leverage Ratio.
(i) The Borrower will not permit the ratio, determined as of the end of
each fiscal quarter ending on or after September 30, 2010 and on or before
June 30, 2011, of (A) Senior Debt as of the end of such fiscal quarter to
(B) Consolidated EBITDAX for the trailing four fiscal quarter period ending
on such date, to be greater than 2.25 to 1.00.
Fourteenth Amendment to Credit Agreement — Page 9
(ii) The Borrower will not permit the ratio, determined as of the
end of each fiscal quarter ending on or after September 30, 2011 and on or
before December 31, 2011, of (A) Senior Debt as of the end of such fiscal
quarter to (B) Consolidated EBITDAX for the trailing four fiscal quarter
period ending on such date, to be greater than 2.50 to 1.00; provided that
the Borrower shall not permit such ratio to be greater than 2.25 to 1.00 for
any such fiscal quarter, in the event the Senior Notes Issuance Date does
not occur on or before December 15, 2010.
(iii) The Borrower will not permit the ratio, determined as of the end
of each fiscal quarter ending on or after March 31, 2012, of (A) Senior Debt
as of the end of such fiscal quarter to (B) Consolidated EBITDAX for the
trailing four fiscal quarter period ending on such date, to be greater than
2.25 to 1.00.
1.11 Convertible Notes Restrictions. Section 7.15 of the Credit Agreement shall be
and it hereby is amended and restated in its entirety to read as follows:
Section 7.15 Convertible Notes Restrictions.
(a) Except for cash payments in settlement of the Borrower’s obligations under
the Convertible Notes Documents upon the conversion or required repurchase of any
Convertible Notes thereunder and regularly scheduled payments of interest, the
Borrower will not, nor will it permit any Restricted Subsidiary to, directly or
indirectly, retire, redeem, defease, repurchase or prepay prior to the scheduled
maturity date thereof any part of the principal of, or interest on, the Convertible
Notes (or any Permitted Refinancing thereof) for cash; provided, however, that the
Borrower may retire, redeem, defease, repurchase or prepay the Convertible Notes (or
any Permitted Refinancing thereof) (i) with the proceeds of any Permitted
Refinancing or (ii) so long as (A) no Default shall have occurred and be continuing
at the time thereof or would result therefrom and (B) the Aggregate Commitment
exceeds the Aggregate Credit Exposure by an amount equal to or greater than 25% of
the Aggregate Commitment at the time thereof, with the proceeds of any substantially
contemporaneous issuance of Equity Interests of the Borrower; provided, further,
that the Borrower may repurchase up to $373,750,000 of aggregate principal amount of
the Convertible Notes pursuant to the Convertible Notes Tender Offer.
(b) The Borrower will not, nor will it permit any Restricted Subsidiary to
enter into or permit any supplement, modification or amendment of, or waive any
right or obligation of any Person under, any Convertible Notes Document or any
document governing any Permitted Refinancing of the Convertible Notes if the effect
thereof would be to (i) shorten its average life or maturity, (ii) increase the
amount of any payment of principal thereof, (iii) increase the rate or shorten any
period for payment of interest thereon, or (iv) cause the covenant, default and
remedy provisions contained therein (including any mandatory redemption or
Fourteenth Amendment to Credit Agreement — Page 10
prepayment provisions) to be materially more onerous to the Borrower and its
Restricted Subsidiaries.
(c) This Section 7.15 shall not prohibit the execution of (i) supplemental
indentures associated with the incurrence of additional Convertible Notes to the
extent permitted by Section 7.01(k), (ii) supplemental indentures providing for
guarantees of the Convertible Notes by Persons that are (or concurrently with the
execution of any such supplemental indenture become) Guarantors hereunder, (iii)
other indentures or agreements in connection with the issuance of any Permitted
Refinancing of the Convertible Notes or (iv) supplements, modifications or
amendments that are reasonably acceptable to the Administrative Agent and not
materially adverse to the Lenders.
1.12 Senior Notes Restrictions. Article VII of the Credit Agreement shall be and it
hereby is amended by adding a new Section 7.18 to read as follows:
Section 7.18 Senior Notes Restrictions.
(a) Except for the issuance of Senior Notes pursuant to an Exchange Offer in
exchange for surrender of previously issued Senior Notes and regularly scheduled
payments of interest, the Borrower will not, nor will it permit any Restricted
Subsidiary to directly or indirectly, retire, redeem, defease, repurchase or prepay
prior to the scheduled maturity date thereof any part of the principal of, or
interest on, the Senior Notes (or any Permitted Refinancing thereof); provided,
however, that the Borrower may retire, redeem, defease, repurchase or prepay the
Senior Notes (or any Permitted Refinancing thereof) (i) with the proceeds of any
Permitted Refinancing and (ii) so long as (A) no Default shall have occurred and be
continuing at the time thereof or would result therefrom and (B) the Aggregate
Commitment exceeds the Aggregate Credit Exposure by an amount equal to or greater
than 25% of the Aggregate Commitment at the time thereof, with the proceeds of any
substantially contemporaneous issuance of Equity Interests of the Borrower.
(b) The Borrower will not, nor will it permit any Restricted Subsidiary to (i)
shorten the scheduled maturity of the Senior Notes to a date that is prior to the
date that is one year after the Maturity Date, (ii) increase the amount of any
payment of principal thereof, (iii) increase the rate or shorten any period for
payment of interest thereon, (iv) alter the subordination provisions, if any, with
respect to any of the Senior Notes in a manner that would result in such Senior
Notes not being expressly subordinate to the payment in full of all of the
Obligations on terms and conditions reasonably satisfactory to the Required Lenders,
or (v) cause the covenant, default and remedy provisions contained therein
(including any mandatory redemption or prepayment provisions) to be materially more
onerous to the Borrower and its Restricted Subsidiaries.
(c) This Section 7.18 shall not prohibit the execution of (i) supplemental
indentures associated with the incurrence of additional Senior
Fourteenth Amendment to Credit Agreement — Page 11
Notes to the extent permitted by Section 7.01(k), (ii) supplemental indentures
providing for guarantees of the Senior Notes by Persons that are (or concurrently
with the execution of any such supplemental indenture become) Guarantors hereunder,
(iii) other indentures or agreements in connection with the issuance of any
Permitted Refinancing of the Senior Notes or (iv) supplements, modifications or
amendments that are reasonably acceptable to the Administrative Agent and not
materially adverse to the Lenders.
SECTION 2. Conditions. The amendments to the Credit Agreement contained in Section 1 of
this Amendment shall be effective upon the satisfaction of each of the conditions set forth in this
Section 2.
2.1 Execution and Delivery. Each Credit Party, the Required Lenders, and the Administrative
Agent shall have executed and delivered this Amendment.
2.2 No Default. No Default shall have occurred and be continuing or shall result from the
effectiveness of this Amendment.
2.3 Other Documents. The Administrative Agent shall have received such other instruments and
documents incidental and appropriate to the transaction provided for herein as the Administrative
Agent or its special counsel may reasonably request prior to the date hereof, and all such
documents shall be in form and substance reasonably satisfactory to the Administrative Agent.
SECTION 3. Borrowing Base Redetermination. Notwithstanding anything to the contrary contained in
the Credit Agreement or the other Loan Documents, the Administrative Agent, the Required Lenders
and each Credit Party acknowledge and agree that the Scheduled Redetermination to occur on or about
September 30, 2010 shall be extended to occur on or about November 19, 2010.
SECTION 4. Representations and Warranties of the Credit Parties. To induce the Lenders to enter
into this Amendment, each Credit Party hereby represents and warrants to the Lenders as follows:
4.1 Reaffirmation of Representations and Warranties/Further Assurances. After giving effect
to the amendments herein, each representation and warranty of such Credit Party contained in the
Credit Agreement or in any of the other Loan Documents is true and correct in all material
respects as of the date hereof (except to the extent such representations and warranties
specifically refer to an earlier date, in which case such representations and warranties shall be
true and correct in all material respects as of such earlier date and taking into account any
amendments to the schedules or exhibits as a result of any disclosures made in writing by such
Credit Party to the Administrative Agent after the Effective Date and approved by the
Administrative Agent and the Required Lenders in writing).
4.2 Corporate Authority; No Conflicts. The execution, delivery and performance by such
Credit Party (to the extent a party hereto or thereto) of this Amendment and all documents,
instruments and agreements contemplated herein are within such Credit Party’s corporate or other
organizational powers, have been duly authorized by all necessary action,
Fourteenth Amendment to Credit Agreement — Page 12
require no action by or in respect of, or filing with, any court or agency of government and
do not violate or constitute a default under any provision of any applicable law or other
agreements binding upon such Credit Party or result in the creation or imposition of any Lien upon
any of the assets of such Credit Party except for Permitted Liens and otherwise as permitted in
the Credit Agreement.
4.3 Enforceability. This Amendment constitutes the valid and binding obligation of such
Credit Party enforceable in accordance with its terms, except as (i) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting creditor’s rights generally and
(ii) the availability of equitable remedies may be limited by equitable principles of general
application.
4.4 No Default. As of the date hereof, both before and immediately after giving effect to
this Amendment, no Default has occurred and is continuing.
SECTION 5. Miscellaneous.
5.1 Reaffirmation of Loan Documents and Liens. Any and all of the terms and provisions of
the Credit Agreement and the Loan Documents shall, except as amended and modified hereby, remain
in full force and effect and are hereby in all respects ratified and confirmed by each Credit
Party. Each Credit Party hereby agrees that nothing contained in this Amendment shall in any
manner affect or impair the liabilities, duties and obligations of such Credit Party under the
Credit Agreement and the other Loan Documents or the Liens securing the payment and performance
thereof.
5.2 Parties in Interest. All of the terms and provisions of this Amendment shall bind and
inure to the benefit of the parties hereto and their respective successors and assigns.
5.3 Legal Expenses. The Borrower hereby agrees to pay all reasonable fees and expenses of
special counsel to the Administrative Agent incurred by the Administrative Agent in connection
with the preparation, negotiation and execution of this Amendment and all related documents.
5.4 Counterparts. This Amendment may be executed in one or more counterparts and by
different parties hereto in separate counterparts each of which when so executed and delivered
shall be deemed an original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to the same document.
Delivery of photocopies of the signature pages to this Amendment by facsimile or electronic mail
shall be effective as delivery of manually executed counterparts of this Amendment.
5.5 Headings. The headings, captions and arrangements used in this Amendment are, unless
specified otherwise, for convenience only and shall not be deemed to limit, amplify or modify the
terms of this Amendment, nor affect the meaning thereof.
5.6 Governing Law. This Amendment shall be construed in accordance with and governed by the
law of the State of Texas.
Fourteenth Amendment to Credit Agreement — Page 13
5.7 Severability. Any provision of this Amendment held to be invalid, illegal or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such invalidity, illegality or unenforceability without affecting the validity, legality and
enforceability of the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
5.8 Complete Agreement. THIS AMENDMENT, THE CREDIT AGREEMENT, AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG
THE PARTIES.
[Signature Page Follows]
Fourteenth Amendment to Credit Agreement — Page 14
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed by their
respective authorized officers to be effective as of the date first above written.
| BORROWER: CARRIZO OIL & GAS, INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President and Chief Financial Officer | |||
| GUARANTORS: CCBM, INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
| CLLR, INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
| HONDO PIPELINE, INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
| CARRIZO (MARCELLUS) LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| CARRIZO MARCELLUS HOLDING INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
| CHAMA PIPELINE HOLDING LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
| BANDELIER PIPELINE HOLDING, LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
| MESCALERO PIPELINE, LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
| CARRIZO (MARCELLUS) WV LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Vice President | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| XXXXX FARGO BANK, N.A., as Administrative Agent, Issuing Bank and as a Lender |
||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | Director | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| ROYAL BANK OF CANADA, as a Co-Syndication Agent and as a Lender |
||||
| By: | /s/ Xxx X. XxXxxxxxxxx | |||
| Name: | Xxx X. XxXxxxxxxxx | |||
| Title: | Authorized Signatory | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK
(f/k/a CALYON NEW YORK BRANCH), as a Co-Syndication
Agent and as a Lender |
||||
| By: | /s/ Xxxxxxx Xxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxx | |||
| Title: | Managing Director | |||
| By: | /s/ Xxxxxxx Xxxxx | |||
| Name: | Xxxxxxx Xxxxx | |||
| Title: | Director | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| CAPITAL ONE, N.A., as Documentation Agent and as a Lender |
||||
| By: | /s/ Xxxx Xxxxxxxxx | |||
| Name: | Xxxx Xxxxxxxxx | |||
| Title: | Senior Vice President | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| UNION BANK, N.A. (f/k/a UNION BANK OF CALIFORNIA, N.A.), as a Lender |
||||
| By: | /s/ Xxxxxx Xxxxxxxxx | |||
| Name: | Xxxxxx Xxxxxxxxx | |||
| Title: | Senior Vice President | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| U.S. BANK NATIONAL ASSOCIATION, as a Lender |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Name: | Xxxxxxx X. Xxxxx | |||
| Title: | Vice President | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Lender |
||||
| By: | /s/ Xxxxxxx Xxxxxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxxxxx | |||
| Title: | Vice President | |||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | Associate | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| COMPASS BANK (as successor in interest to Guaranty Bank), as a Lender |
||||
| By: | /s/ Xxxxxxxx X. Xxxxx | |||
| Name: | Xxxxxxxx X. Xxxxx | |||
| Title: | Senior Vice President | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| BNP PARIBAS., as a Lender |
||||
| By: | /s/ Xxxx Xxxxxxxx | |||
| Name: | Xxxx Xxxxxxxx | |||
| Title: | Director | |||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | Director | |||
Signature Page
Fourteenth Amendment to Credit Agreement
| COMPASS BANK, as a Lender |
||||
| By: | /s/ Xxxxxxxx X. Xxxxx | |||
| Name: | Xxxxxxxx X. Xxxxx | |||
| Title: | Senior Vice President | |||
Signature Page
Fourteenth Amendment to Credit Agreement
