EXHIBIT 10.1
FIFTH AMENDMENT TO CREDIT AGREEMENT
This Fifth Amendment to Credit Agreement (this "Fifth Amendment"), dated
as of February 28, 2006 (the "Effective Date"), is by and among DELTA
PETROLEUM CORPORATION, a Colorado corporation ("Borrower"), JPMORGAN CHASE
BANK, N.A., a national banking association, as Administrative Agent
("Administrative Agent"), and each of the financial institutions a party
hereto as Banks (hereinafter collectively referred to as "Executing Banks,"
and individually, an "Executing Bank").
W I T N E S S E T H:
WHEREAS, Borrower, Administrative Agent, JPMorgan Chase Bank, N.A., and
the financial institutions party thereto as Banks are parties to that certain
Credit Agreement dated as of November 5, 2004 (as heretofore amended, the
"Credit Agreement") (unless otherwise defined herein, all terms used herein
with their initial letter capitalized shall have the meaning given such terms
in the Credit Agreement, as amended hereby); and
WHEREAS, Borrower has requested that Banks (i) amend certain terms of
the Credit Agreement in certain respects, and (ii) provide a limited waiver
of an existing Default and Event of Default more particularly described in
Section 2 hereof; and
WHEREAS, subject to and upon the terms and conditions set forth herein,
Executing Banks have agreed to Borrower's requests.
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,
Borrower, Administrative Agent and Executing Banks hereby agree as follows:
Section 1. Amendments. In reliance on the representations, warranties,
covenants and agreements contained in this Fifth Amendment, and subject to
the satisfaction of each condition precedent set forth in Section 3 hereof,
the Credit Agreement is hereby amended effective as of the Effective Date in
the manner provided in this Section 1.
1.1 Amendment to Definitions. The definitions of "Loan Papers,"
"Permitted Investments" and "Unrestricted Subsidiary" contained in Section
1.1 of the Credit Agreement shall be amended to read in full as follows:
"Loan Papers" means this Agreement, the First Amendment, the Second
Amendment, the Third Amendment, the Fourth Amendment, the Fifth Amendment,
the Notes, each Facility Guaranty which may now or hereafter be executed,
each Borrower Pledge Agreement which may now or hereafter be executed, each
Subsidiary Pledge Agreement which may now or hereafter be executed, the
Existing Mortgages (as amended by the Assignments and Amendment to
Mortgages), the Assignments and Amendments to Mortgages, all Mortgages now or
at any time hereafter delivered pursuant to Section 5.1, all Letters of
Credit, and all other certificates, documents or instruments delivered in
connection with this Agreement, as the foregoing may be amended from time to
time.
"Permitted Investments" means (a) readily marketable direct
obligations of the United States of America (or investments in mutual funds
or similar funds which invest solely in such obligations), (b) fully insured
demand or time deposits and certificates of deposit with maturities of one
year or less of any commercial bank operating in the United States having
capital and surplus in excess of $500,000,000, (c) commercial paper of a
domestic issuer if at the time of purchase such paper is rated in one of the
two highest ratings categories of Standard and Poor's Corporation or Xxxxx'x
Investors Service, (d) Investments by any Credit Party in a Subsidiary of
Borrower that has provided a Facility Guaranty and the Equity of which has
been pledged to Administrative Agent pursuant to a Borrower Pledge Agreement
or a Subsidiary Pledge Agreement, (e) Investments in Crystal Energy, LLC
existing on the Closing Date, (f) Investments in DHS in an aggregate amount
outstanding at any time not to exceed $71,000,000 (measured on a cost basis),
provided, that, any Investments in DHS in an aggregate amount exceeding
$21,000,000 (measured on a cost basis) shall only be permitted to the extent
such Investments are made either (i) with the proceeds received by Borrower
from the issuance and sale of Borrower's Equity, and only to the extent such
proceeds have been specifically dedicated by Borrower for such Investment as
described and set forth in detail in the most recent certificate of Financial
Officer delivered to each Bank pursuant to Section 8.1(c) hereof, (ii) as the
result of the receipt of non-cash consideration from the issuance of
Borrower's Equity and the contribution of such non-cash consideration to DHS,
or (iii) with the proceeds received by Borrower from any Specified Asset Sale
made pursuant to and in accordance and compliance with Section 9.5(b) hereof,
and only to the extent such proceeds have been specifically dedicated by
Borrower for such Investment as described and set forth in detail in the most
recent certificate of Financial Officer delivered to each Bank pursuant to
Section 8.1(c) hereof, and (g) other Investments; provided, that, the
aggregate amount of all other Investments made pursuant to this clause (g)
outstanding at any time shall not exceed $500,000 (measured on a cost basis).
"Unrestricted Subsidiary" means any Subsidiary of Borrower which is
not a Restricted Subsidiary and shall include, as of the Effective Date (as
defined in the Fifth Amendment), Amber, DHS and Rooster.
1.2 Additional Definitions. Section 1.1 of the Credit Agreement
shall be amended to add the following definition to such Section:
"Fifth Amendment" means that certain Fifth Amendment to Credit
Agreement dated as of February 28, 2006, among Borrower, Administrative Agent
and Banks party thereto.
"Rooster" means Rooster Drilling, Inc., a Nevada corporation.
"Specified Asset Sale" means the sale, assignment, lease, license,
transfer, exchange or other disposition by Borrower of all or substantially
all of its right, title and interest in Castle's Appalachian properties.
1.3 Amendment to Information Covenant. Section 8.1(c) of the
Credit Agreement shall be amended to read in full as follows:
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"(c) simultaneously with the delivery of each set of financial
statements referred to in Section 8.1(a) and Section 8.1(b), a certificate of
the principal executive and Financial Officer of Borrower in the form of
Exhibit I attached hereto, (i) setting forth in reasonable detail the
calculations required to establish whether Borrower was in compliance with
the requirements of Article X on the date of such financial statements, (ii)
stating whether there exists on the date of such certificate any Default and,
if any Default then exists, setting forth the details thereof and the action
which Borrower is taking or proposes to take with respect thereto, (iii)
stating whether or not such financial statements fairly reflect in all
material respects the results of operations and financial condition of
Borrower as of the date of the delivery of such financial statements and for
the period covered thereby, (iv) setting forth (A) whether as of such date
there is a Material Gas Imbalance and, if so, setting forth the amount of net
gas imbalances under Gas Balancing Agreements to which Borrower is a party or
by which any Mineral Interests owned by Borrower is bound, and (B) the
aggregate amount of all Advance Payments received under Advance Payment
Contracts to which Borrower is a party or by which any Mineral Interests
owned by Borrower is bound which have not been satisfied by delivery of
production, if any, (v) setting forth a summary of the Hedge Transactions to
which Borrower is a party on such date, (vi) setting forth in reasonable
detail (A) the amount of any proceeds received in connection with any Equity
issuance or Specified Asset Sale described in the proviso in clause (f) of
the definition of "Permitted Investments," (B) the amount and specific
application of any such proceeds since the delivery of the last certificate
to be provided pursuant to this Section 8.1(c), and (C) the designation and
proposed use of any such unutilized proceeds by Borrower, (vii) stating as of
such date whether Borrower is in compliance with the terms of clause (f) of
the definition of "Permitted Investment," and (viii) setting forth the other
information described in Exhibit I attached hereto;".
Section 2. Limited Waiver. Borrower hereby (a) acknowledges that (i)
Borrower has failed to comply with the provisions set forth in Section
10.1(b) of the Credit Agreement for the Fiscal Quarter ended December 31,
2005 (the "Specified Default"), and (ii) the Specified Default constitutes an
Event of Default under the Credit Agreement, and (b) requests that Banks
waive the Specified Default. In reliance on the representations, warranties,
covenants and agreements contained in the Credit Agreement and this Fifth
Amendment, and subject to the satisfaction of the conditions precedent set
forth in Section 3 hereof, Executing Banks hereby waive the Specified Default
for the Fiscal Quarter ended December 31, 2005. The limited waiver contained
in this Section 2 is limited solely to the Specified Default, and solely for
the Fiscal Quarter ended December 31, 2005, and nothing contained herein
shall obligate Banks to grant any additional or future waiver with respect
to, or in connection with, any provision of the Credit Agreement or any other
Loan Paper.
Section 3. Conditions Precedent. The effectiveness of the amendments
to the Credit Agreement contained in Section 1 hereof and the limited waiver
granted in Section 2 hereof is subject to the satisfaction of each condition
precedent set forth in this Section 3:
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3.1 Amendment Fee. Upon execution of this Fifth Amendment by
Required Banks, Borrower shall pay to Administrative Agent, for the benefit
of Executing Banks, a fee in the amount of $5,000 for each Executing Bank.
Such $5,000 fee shall be distributed by Administrative Agent to each
Executing Bank provided that such Executing Bank executes and delivers this
Fifth Amendment on or before February 28, 2006.
3.2 No Defaults. After giving effect to the amendments contained
in Section 1 hereof and the limited waiver granted in Section 2 hereof, no
Default or Event of Default shall exist.
3.3 Fees and Expenses. Borrower shall have paid all fee and
amounts as Borrower shall be required to pay to Administrative Agent and its
Affiliates pursuant to any separate agreement between or among Borrower,
Administrative Agent and/or its Affiliates.
3.4 Other Documentation. Administrative Agent shall have received
such other documents, instruments and agreements as it or any Bank may
reasonably request, all in form and substance reasonably satisfactory to
Administrative Agent and Banks.
Section 4. Representations and Warranties of Borrower. To induce Banks
and Administrative Agent to enter into this Fifth Amendment, Borrower hereby
represents and warrants to Banks and Administrative Agent as follows:
4.1 Due Authorization; No Conflict. The execution, delivery and
performance by Borrower of this Fifth Amendment are within Borrower's
corporate powers, have been duly authorized by all necessary action, require
no action by or in respect of, or filing with, any governmental body, agency
or official and do not violate or constitute a default under any provision of
applicable law or any Material Agreement binding upon Borrower or result in
the creation or imposition of any Lien upon any of the assets of Borrower
except Permitted Encumbrances.
4.2 Validity and Enforceability. This Fifth Amendment constitutes
the valid and binding obligation of Borrower enforceable in accordance with
its terms, except as (a) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditor's rights generally,
and (b) the availability of equitable remedies may be limited by equitable
principles of general application.
4.3 Accuracy of Representations and Warranties. Each
representation and warranty of each Credit Party contained in the Loan Papers
is true and correct in all material respects as of the date hereof (except to
the extent such representations and warranties are expressly made as of a
particular date, in which event such representations and warranties were true
and correct as of such date).
4.4 Absence of Defaults. After giving effect to the amendments
contained in Section 1 hereof and the limited waiver granted in Section 2
hereof, no Default or Event of Default has occurred which is continuing.
4.5 No Defense. Borrower has no defense to the payment of, or any
counterclaim or rights of set-off with respect to, all or any portion of the
Obligations.
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Section 5. Miscellaneous.
5.1 Reaffirmation of Loan Papers. Any and all of the terms and
provisions of the Credit Agreement and the Loan Papers shall, except as
amended and modified hereby, remain in full force and effect, and are hereby
ratified and confirmed. The amendments contemplated hereby shall not limit
or impair any Liens securing the Obligations, each of which are hereby
ratified, affirmed and extended to secure the Obligations.
5.2 Confirmation of Loan Papers and Liens. As a material
inducement to Banks to make the agreements and grant the amendments and
waivers set forth herein, Borrower hereby (a) acknowledges and confirms the
continuing existence, validity and effectiveness of the Loan Papers and the
Liens granted thereunder, (b) agrees that the execution, delivery and
performance of this Fifth Amendment and the consummation of the transaction
contemplated hereby shall not in any way release, diminish, impair, reduce or
otherwise adversely affect such Loan Papers and Liens, and (c) acknowledges
and agrees that the Liens granted under the Loan Papers secure, and after the
consummation of the transactions contemplated hereby will continue to secure,
the payment and performance of the Obligations as first priority perfected
Liens.
5.3 Parties in Interest. All of the terms and provisions of this
Fifth Amendment shall bind and inure to the benefit of the parties hereto and
their respective successors and assigns.
5.4 Legal Expenses. Borrower hereby agrees to pay on demand all
reasonable fees and expenses of counsel to Administrative Agent incurred by
Administrative Agent in connection with the preparation, negotiation and
execution of this Fifth Amendment.
5.5 Counterparts. This Fifth Amendment may be executed in
counterparts, and all parties need not execute the same counterpart; however,
no party shall be bound by this Fifth Amendment until Borrower and Required
Banks have executed a counterpart. Facsimiles shall be effective as
originals.
5.6 Complete Agreement. THIS FIFTH AMENDMENT, THE CREDIT
AGREEMENT AND THE OTHER LOAN PAPERS 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
BETWEEN OR AMONG THE PARTIES.
5.7 Headings. The headings, captions and arrangements used in
this Fifth Amendment are, unless specified otherwise, for convenience only
and shall not be deemed to limit, amplify or modify the terms of this Fifth
Amendment, nor affect the meaning thereof.
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5.8 Effectiveness. This Fifth Amendment shall be effective
automatically and without necessity of any further action by Borrower,
Administrative Agent or Banks when counterparts hereof have been executed by
Borrower, Administrative Agent and Required Banks, and all conditions to the
effectiveness hereof set forth herein and in the Credit Agreement have been
satisfied (including, without limitation, all conditions precedent set forth
in Section 3 hereof).
IN WITNESS WHEREOF, the parties hereto have caused this Fifth Amendment
to be duly executed by their respective Authorized Officers on the date and
year first above written.
[Signature pages to follow]
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SIGNATURE PAGE TO
FIFTH AMENDMENT TO CREDIT AGREEMENT
BY AND AMONG
DELTA PETROLEUM CORPORATION, AS BORROWER,
JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT
AND THE BANKS PARTY THERETO
BORROWER:
DELTA PETROLEUM CORPORATION,
a Colorado corporation
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer
Each of the undersigned (i) consent and agree to this Fifth Amendment,
and (ii) agree that the Loan Papers to which it is a party shall remain in
full force and effect and shall continue to be the legal, valid and binding
obligation of such Person, enforceable against it in accordance with its
terms.
ACKNOWLEDGED AND AGREED TO BY:
DELTA EXPLORATION COMPANY, INC.,
a Colorado corporation
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer
PIPER PETROLEUM COMPANY,
a Colorado corporation
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer
SIGNATURE PAGE TO
FIFTH AMENDMENT TO CREDIT AGREEMENT
BY AND AMONG
DELTA PETROLEUM CORPORATION, AS BORROWER,
JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT
AND THE BANKS PARTY THERETO
ADMINISTRATIVE AGENT:
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
By: /s/ J. Xxxxx Xxxxxx
J. Xxxxx Xxxxxx,
Vice President
BANKS:
JPMORGAN CHASE BANK, N.A.
By: /s/ J. Xxxxx Xxxxxx
J. Xxxxx Xxxxxx,
Vice President
SIGNATURE PAGE TO
FIFTH AMENDMENT TO CREDIT AGREEMENT
BY AND AMONG
DELTA PETROLEUM CORPORATION, AS BORROWER,
JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT
AND THE BANKS PARTY THERETO
BANK OF OKLAHOMA, N.A.
By: /s/ Xxxxx Rheem
Name: Xxxxx Rheem
Title: Vice President
SIGNATURE PAGE TO
FIFTH AMENDMENT TO CREDIT AGREEMENT
BY AND AMONG
DELTA PETROLEUM CORPORATION, AS BORROWER,
JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT
AND THE BANKS PARTY THERETO
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
SIGNATURE PAGE TO
FIFTH AMENDMENT TO CREDIT AGREEMENT
BY AND AMONG
DELTA PETROLEUM CORPORATION, AS BORROWER,
JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT
AND THE BANKS PARTY THERETO
HIBERNIA NATIONAL BANK
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: Vice President
SIGNATURE PAGE TO
FIFTH AMENDMENT TO CREDIT AGREEMENT
BY AND AMONG
DELTA PETROLEUM CORPORATION, AS BORROWER,
JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT
AND THE BANKS PARTY THERETO
COMERICA BANK
By: /s/ Xxxxxxx X. Purchase
Name: Xxxxxxx X. Purchase
Title: Vice President
SIGNATURE PAGE TO
FIFTH AMENDMENT TO CREDIT AGREEMENT
BY AND AMONG
DELTA PETROLEUM CORPORATION, AS BORROWER,
JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT
AND THE BANKS PARTY THERETO
BANK OF SCOTLAND
By: /s/ Xxxxx Xxxxx
Name: Xxxxx Xxxxx
Title: Assistant Vice President
