EXHIBIT 10.1
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FIRST AMENDMENT TO LOAN AGREEMENT
This First Amendment to Loan Agreement (this "Amendment") dated as of
August 4, 2006, is made among GMX Resources Inc., an Oklahoma corporation (the
"Borrower"), Capital One, National Association, a national banking association,
as administrative agent (the "Agent"), and Union Bank of California, N.A. and
Capital One, National Association, as Banks (the "Banks"), who agrees as
follows:
RECITALS
A. This First Amendment to Loan Agreement pertains to that certain Amended
and Restated Loan Agreement (Line of Credit) dated as of June 7, 2006, among the
Borrower, the Agent and the Banks (the "Loan Agreement"). As used in this
Agreement, capitalized terms used herein without definition herein shall have
the meanings provided in the Loan Agreement.
B. The Borrower proposes to issue Series B Cumulative Preferred Stock and
has requested that the Agent and the Banks consent to the outline of the terms
for such cumulative preferred stock. The Borrower, the Agent and the Banks
accordingly desire to enter into this Amendment.
AGREEMENT
NOW, THEREFORE, in consideration of the terms and conditions contained
herein, and the loans and extensions of credit heretofore, now or hereafter made
to the Borrower by the Banks, the parties hereto hereby agree as follows:
ARTICLE 1.
AMENDMENTS
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1.1 Section 1.2 of the Loan Agreement is hereby amended by amending and
restating the definition of the term "Maximum Subordinated Amount", to read in
its entirety as follows:
"Maximum Subordinated Amount" shall mean fifty million ($50,000,000.00)
dollars.
1.2 Section 1.2 of the Loan Agreement is hereby further amended by amending
and restating the definition of the term "Qualified Redeemable Preferred
Equity", to read in its entirety as follows:
"Qualified Redeemable Preferred Equity" shall mean redeemable
preferred stock issued by the Borrower which (i) does not exceed in
total consideration paid to or for the account of the Borrower in
connection therewith, when added to the total principal amount of all
Qualified Subordinated Debt issued by the Borrower, the Maximum
Subordinated Amount, (ii) is not redeemable in any part earlier than
five (5) years after its issuance date, except only at the voluntary
option of the Borrower and except for mandatory redemption following a
change of ownership or control or
management (as contemplated by Sections 6.13 or 6.12, respectively),
(iii) has a stated interest or dividend rate of less than ten (10%)
percent per annum, except for a default dividend rate not exceeding
twelve (12%) percent per annum, (iv) sets forth covenants that in the
judgment of the Agent and Agent's counsel are no more restrictive on
the Companies and their operations and affairs than the covenants
contained in this Agreement, and (v) is unsecured by any Liens."
1.3 Section 6.10 of the Loan Agreement is hereby amended and restated to
read in its entirety as follows:
"Distributions or Redemption. (a) The Borrower will not (i) pay
or declare any dividend on any shares of any class of its stock (other
than stock dividends), (ii) make any other distribution or other
shareholder expenditure on account of any shares of any class of its
stock, nor set aside any funds for such purpose, nor (iii) otherwise
make or agree to pay for or make (except as set forth in (b) below),
directly or indirectly, any other distribution with respect to any
shares of any class of its stock, or any payment (whether in cash,
securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such shares or any
option, warrants or other right to acquire any such shares, except
that if at the time thereof and immediately after giving effect
thereto no Default or Event of Default shall have occurred and be
continuing (or be created), and no Loan Excess shall then exist, the
Borrower may declare, and agree to declare and pay, dividends
(interest expense) in cash to the holders of Qualified Redeemable
Preferred Equity, and the Borrower may make and pay such cash
dividends so declared within thirty (30) days of such declaration. For
the avoidance of doubt, shares of Qualified Redeemable Preferred
Equity are Borrower's stock for purposes of clauses (i), (ii) and
(iii) above, and the Borrower shall not elect (or agree to elect) any
option to redeem any Qualified Redeemable Preferred Equity without the
prior written consent of the Required Banks.
(b) The Qualified Redeemable Preferred Equity issued by Borrower may
include (as provided in clause (ii) of the definition thereof) a
provision providing for a mandatory redemption of such stock following
a change of ownership or control or management (as contemplated by
Sections 6.13 or 6.12, respectively). Moreover, the Borrower may make
a mandatory redemption payment on the Qualified Redeemable Preferred
Equity solely by reason of a change of ownership or control or
management (as
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contemplated by Sections 6.13 or 6.12, respectively), and such
mandatory redemption payment in itself is not an Event of Default
(although nothing set forth in this Agreement shall subordinate the
Secured Parties' rights to priority of payment). However, the Borrower
acknowledges that nothing set forth in this Section 6.10 (or in the
definition of Qualified Redeemable Preferred Equity or Subsection
8.1(o) below) modifies or restricts the application of Section 6.12
and Section 6.13, and if a change in management or a change in
ownership or control, respectively, occurs within the meaning of those
Sections then an Event of Default occurs under Subsection 8.1(c)
unless the Agent's and the Required Banks' prior written consent to
the contrary is obtained (even though any mandatory redemption of
Qualified Redeemable Preferred Equity which also may arise due to such
change in management, ownership or control is not itself a breach of
this Section 6.10 or an Event of Default)."
1.4 Subsection 8.1(o) of the Loan Agreement is hereby amended and restated
to read in its entirety as follows:
(o) Qualified Redeemable Preferred Equity. (i) The Borrower defaults
in the payment of any amounts due under or in the observance or
performance of any of the covenants or agreements contained in
any documents pertaining to any Qualified Redeemable Preferred
Equity, and any grace period applicable to such default has
elapsed; or (ii) any shares of Qualified Redeemable Preferred
Equity shall for any reason become subject to mandatory
redemption by the Borrower before the fifth anniversary of the
date on which such shares are issued or if any event or condition
occurs that enables or permits (with or without the giving of
notice, the lapse of time or both) the holder of any shares of
any Qualified Redeemable Preferred Equity to cause any of such
shares to be redeemable or to require the redemption thereof by
the Borrower (in each case after giving effect to any applicable
cure period), except as to all of this clause (ii) for a
mandatory redemption following a change of ownership or control
or management (as contemplated by Sections 6.13 or 6.12,
respectively); or (iii) any judgment for redemption of any shares
of Qualified Redeemable Preferred Equity is rendered by any court
or other governmental body except to enforce a mandatory
redemption following a change of ownership or
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control or management (as contemplated by Sections 6.13 or 6.12,
respectively). For the avoidance of doubt, nothing in this
Subsection modifies or restricts the application of Section 6.10,
Section 6.11, Section 6.12 or Section 6.13, nor does this
Subsection modify or limit Subsection 8.1(c) above.
ARTICLE 2.
ACKNOWLEDGMENT OF COLLATERAL
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2.1 The Borrower hereby specifically reaffirms all of the Collateral
Documents. The Borrower hereby confirms and agrees that the Collateral Documents
secure the Loan Agreement as amended by this Amendment.
ARTICLE 3.
MISCELLANEOUS
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3.1 The Borrower represents and warrants to the Agent and the Banks (which
representations and warranties will survive the execution of this Amendment)
that (i) all representations and warranties contained in the Loan Agreement and
the Collateral Documents are true and correct on and as of the date hereof as
though made on and as of such date, except to the extent such representations
and warranties specifically relate to an earlier date, in which case such
representations and warranties shall have been true and correct on and as of
such earlier date, (ii) no event has occurred and is continuing as of the date
hereof which constitutes a Default or Event of Default, (iii) there has not
occurred any material adverse change in the Collateral or other assets,
liabilities, financial condition, business operations, affairs or circumstances
of the Borrower and the Subsidiaries taken as a whole or any other facts,
circumstances or conditions (financial or otherwise) upon which a Bank has
relied or utilized in making its decision to enter into this Amendment, and (iv)
there is no defense, offset, compensation, counterclaim or reconventional demand
with respect to amounts due under, or performance of, the terms of the Notes and
the Loan Agreement. To the extent any such defense, offset, compensation,
counterclaim or reconventional demand or other causes of action by the Borrower
against the Agent or any Bank might exist, whether known or unknown, such items
are hereby waived by the Borrower.
3.2 Except as expressly modified by this Amendment, all terms and
provisions of the Loan Agreement are hereby ratified and confirmed and shall be
and shall remain in full force and effect, enforceable in accordance with its
terms.
3.3 Borrower agrees to pay on demand all costs and expenses of the Agent
and the Banks in connection with the preparation, reproduction, execution and
delivery of this Amendment and the other instruments and documents to be
delivered hereunder (including the reasonable fees and expenses of counsel for
the Agent). In addition, Borrower shall pay any and all stamp or other taxes,
recordation fees and other fees payable in connection with the execution,
delivery, filing or recording of this Amendment and the other instruments and
documents to be delivered hereunder and agrees to hold Agent and the Banks
harmless from and
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against any all liabilities with respect to or resulting from any delay or
omission in paying such taxes or fees.
3.4 This Amendment may be executed in multiple separate counterparts, and
it shall not be necessary that the signatures of all parties hereto be contained
on any one counterpart hereof; each party's signature may appear on a separate
counterpart but all such counterpart taken together shall constitute one and the
same instrument. The parties specifically confirm their intent to be bound by
delivery of such signed counterparts by telecopier.
3.5 The provisions of this Amendment shall become effective if and when,
and only when, (i) each and every representation and warranty of Borrower
contained in this Amendment is true, complete and accurate, (ii) no event exists
which constitutes a Default, and (iii) the receipt by the Agent of the
following:
(a) A duly executed counterpart of this Amendment; and
(b) A Certificate of the Secretary of the Borrower, confirming the
continued effectiveness of the resolutions of its Board of
Directors.
The Borrower hereby certifies by execution of this Amendment that the foregoing
conditions (i) and (ii) are satisfied and true and correct. The documents
required under condition (iii) in each case shall be in form and substance
satisfactory to the Agent and its counsel.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
duly executed as of the date first above written.
BORROWER: GMX RESOURCES INC.
By: /s/ Xxx X. Xxxxxxxxx, Xx.
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Name: Xxx X. Xxxxxxxxx, Xx.
Title: Executive Vice President and CFO
AGENT: CAPITAL ONE, NATIONAL ASSOCIATION
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: Vice President
BANKS: CAPITAL ONE, NATIONAL ASSOCIATION,
as a Bank
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: Vice President
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