EXHIBIT 4.4
THIRD AMENDMENT TO CREDIT AGREEMENT
This THIRD AMENDMENT TO CREDIT AGREEMENT (this "THIRD AMENDMENT") is
dated as of October 24, 1997 (the "EFFECTIVE DATE"), among XXXXXXXXXXX ENTERRA,
INC., a Delaware corporation (the "COMPANY"), the several financial institutions
party to this Third Amendment (collectively, the "BANKS"; individually, a
"BANK"), BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, successor to
Bank of America Illinois, as the documentation agent for the Banks (the
"DOCUMENTATION AGENT"), and TEXAS COMMERCE BANK NATIONAL ASSOCIATION, as the
administrative agent for the Banks (the "ADMINISTRATIVE AGENT"; together with
the Documentation Agent, the "AGENTS"). Capitalized terms which are used herein
without definition and which are defined in the Credit Agreement referred to
below shall have the meanings ascribed to them in the Credit Agreement.
WHEREAS, reference is made to the Credit Agreement dated as of October
5, 1995, among the Company, the Banks therein named, the Agents and the
co-agents therein named, as amended by First Amendment dated as of December 29,
1995, and as further amended by Second Amendment dated as of March 20, 1996 (as
the same may be further amended, modified or supplemented and in effect from
time to time, the "CREDIT AGREEMENT"); and
WHEREAS, the Company has requested that the Agents and the Banks agree
to certain amendments to the Credit Agreement as herein set forth, and subject
to the terms hereof the Agents and the Banks are willing to agree to the
Company's requested modifications;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agrees as
follows:
SECTION 1. AMENDMENTS TO THE CREDIT AGREEMENT.
1.1 AMENDMENTS TO ARTICLE I.
(a) The definition of "APPLICABLE MARGIN" set forth in ARTICLE I
is hereby amended to read as set forth below:
"APPLICABLE MARGIN" means the number of Basis Points (as
defined in SECTION 2.02) per annum applicable to Base Rate Loans and
Eurodollar Loans as determined pursuant to SECTION 2.02 by reference to
SCHEDULE 2.02.
(b) The definitions of "EBIT" and "ADJUSTMENT DATE" set forth in
ARTICLE I are hereby deleted in their entirety.
(c) The definition of "INTEREST COVERAGE RATIO" set forth in
ARTICLE I is hereby amended by deleting the word "EBIT" and substituting the
word "EBITDA" therefor.
(d) Subsection (a) of the definition of "REVOLVING CREDIT
TERMINATION DATE" is hereby amended to read as follows: "(a) October 24, 2002;
and".
(e) The definition of "REVOLVING LOAN BORROWER" is hereby amended
to read as set forth below, and all references in the Credit Agreement to
"Revolving Loan
-1-
Borrower" and "Revolving Loan Borrowers" shall mean Revolving Loan Borrower(s)
as defined below:
"REVOLVING LOAN BORROWER" means each of the Company
and the Subsidiary Borrowers.
(f) The definition of "WHOLLY-OWNED SUBSIDIARY" is hereby amended to
read as set forth below:
"WHOLLY-OWNED SUBSIDIARY" means any Subsidiary of which 100% of
the capital stock (other than directors' qualifying shares required by
law) or other equity interests (in the case of Persons other than
corporations), is owned, beneficially and of record, by the Company, or
by one or more of the other Wholly-Owned Subsidiaries, or both.
(g) The following definitions are hereby added to ARTICLE I in correct
alphabetical order:
"EBITDA" means, for the relevant period, the sum of: (a)
the consolidated Net Income of the Company and its Consolidated
Subsidiaries for such period, (b) non-recurring costs incurred during
such period by the Company and its Consolidated Subsidiaries in
connection with any Acquisition (including, but without limitation, the
Merger) consummated during such period to the extent included in the
determination of such consolidated Net Income, (c) consolidated Interest
Expense of the Company and its Consolidated Subsidiaries for such period
to the extent included in the determination of such consolidated Net
Income, (d) all taxes measured by income to the extent included in the
determination of such consolidated Net Income, and (e) all amounts
treated as expenses for depreciation and the amortization of intangibles
of any kind for such period to the extent included in the determination
of such Net Income; provided, however, that consolidated Net Income
shall be computed for purposes of this definition without giving effect
to extraordinary losses or extraordinary gains for such period.
"MOODY'S" means Xxxxx'x Investors Service, Inc.
"PARENT GUARANTY" means a Guaranty substantially in the
form of EXHIBIT "B-1" attached hereto, in favor of the Administrative
Agent and the Banks, as the same may be amended, supplemented or
otherwise modified from time to time. References to the "Guaranties" or
to a "Guaranty" shall, following any execution and delivery by the
Company of the Parent Guaranty, be deemed to refer to the Parent
Guaranty. Prior to any such execution and delivery by the Company of the
Parent Guaranty, any such references shall be given no effect.
References to the "Guarantors" or to a "Guarantor" shall, following any
execution and delivery by the Company of the Parent Guaranty, be deemed
to refer to the Company. Prior to any such execution and delivery by the
Company of the Parent Guaranty, any such references shall be given no
effect.
"RATING" means the rating assigned by the applicable
Rating Agency to senior unsecured (non-credit enhanced) long-term debt
of the Company.
-2-
"RATING AGENCIES" means S&P and Moody's, respectively.
"S&P" means Standard & Poor's Corporation.
"SUBSIDIARY BORROWER" means each Wholly-Owned Subsidiary
that has executed and delivered this Agreement (including by means of
execution and delivery of a Subsidiary Borrower Counterpart) and has
satisfied the requirements of SECTION 4.03.
"SUBSIDIARY BORROWER COUNTERPART" means a counterpart in
substantially the form of EXHIBIT "I" hereto.
1.2 AMENDMENTS TO ARTICLE II.
(a) SECTION 2.01 is hereby amended by adding new SUBSECTIONS (D)
and (E) thereto, to read as follows:
(d) LOAN ACCOUNTS. The Loans made by each Bank shall be
evidenced by one or more accounts or records maintained by such Bank in
the ordinary course of business. The accounts or records maintained by
the Administrative Agent and each Bank shall be prima facie evidence of
the amount of the Loans made by the Banks to each Borrower and the
interest and payments thereon. Any failure so to record or any error in
doing so shall not, however, limit or otherwise affect the obligation of
any Borrower hereunder to pay any amount owing by such Borrower with
respect to the Loans made to such Borrower.
(e) NOTES. Upon the request of any Bank made through the
Administrative Agent, the Revolving Loans made by such Bank may be
evidenced by one or more Revolving Credit Notes, instead of or in
addition to loan accounts. Each Bank may endorse on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made
by it and the amount of each payment of principal made by or on behalf
of the relevant Borrower with respect thereto. Such Bank's endorsement
shall be prima facie evidence as to such matters; PROVIDED, HOWEVER,
that the failure of a Bank to make, or an error in making, a notation
thereon with respect to any Loan shall not limit or otherwise affect the
obligations of the Borrowers hereunder or under any such Note to such
Bank.
(b) SECTION 2.02 is hereby amended in its entirety to read as
follows:
2.02 CERTAIN PRICING TERMS. The Applicable Margin and the
Commitment Fee, at any time, shall be equal to the applicable number of
Basis Points per annum specified in SCHEDULE 2.02 hereto in the column
identified by the Level (a "Level") corresponding to the applicable
Ratings assigned at such time by the Rating Agencies; provided, however,
that (a) if different Ratings are assigned by S&P and Moody's and the
Ratings are only one Level apart, then the pricing shall be determined
based on the higher of the two Ratings, and (b) if different Ratings are
assigned by S&P and Moody's and the Ratings are more than one Level
apart, then the pricing shall be at the Level which is one Level higher
than the lower of the two Ratings. If any Rating established by a Rating
Agency shall be changed, such change shall be effective for purposes of
determining the Applicable
-3-
Margin and the Commitment Fee hereunder as of the date on which such
change is first announced by the applicable Rating Agency. The Company
shall give prompt written notice to the Administrative Agent of any
changes to any Ratings. As used herein, "Basis Point" means one
one-hundredth of one percent (1/100th of 1%).
(c) The first sentence of SUBSECTION 2.09(B) is hereby amended to read
in its entirety as follows:
The Company shall also pay to the Administrative Agent for the
account of each Bank a fee ("Commitment Fee") on the average daily
unused portion of such Bank's Commitment, computed on a quarterly basis
in arrears on the last Business Day of each calendar quarter based upon
the daily utilization for that quarter as calculated by the
Administrative Agent, equal to the applicable number of Basis Points per
annum determined in accordance with SECTION 2.02 by reference to
SCHEDULE 2.02.
1.3 AMENDMENTS TO ARTICLE IV. The following new SECTION 4.03 is added to
the Credit Agreement:
4.03 CONDITIONS OF INITIAL CREDIT EXTENSION TO EACH
SUBSIDIARY BORROWER. Any Wholly-Owned Subsidiary (other than a Foreign
Subsidiary) may become a Subsidiary Borrower. The Banks shall not be
required to make any Loan to a Subsidiary Borrower hereunder unless such
Subsidiary Borrower has furnished to the Administrative Agent with
sufficient copies for the Banks:
(a) A Subsidiary Borrower Counterpart executed by such
Subsidiary and acknowledged by the Company, together with a schedule of
litigation as may be necessary in connection with such Subsidiary making
the representations and warranties set forth in SECTION 5.05 of this
Agreement, such schedule to be in form and substance satisfactory to the
Administrative Agent and each of the Banks;
(b) A current certificate of existence and a certificate
of good standing (if such a certificate is available for the relevant
type of entity organized in such state), both certified by the
appropriate governmental officer, in its jurisdiction of organization;
(c) Copies, certified by the Secretary or Assistant
Secretary of such Subsidiary Borrower, of its Certificate or Articles of
Incorporation or other constituent documents, Bylaws (in the case of a
corporation) and resolutions authorizing the execution of the Loan
Documents to which it is a party;
(d) An incumbency certificate, executed by the Secretary
or Assistant Secretary of such Subsidiary Borrower, which shall identify
by name and title and bear the signature of the officers of the
Subsidiary Borrower authorized to sign the Loan Documents to which it is
a party and to make borrowings hereunder, upon which certificates the
Agent and the Banks shall be entitled to rely until informed of any
change in writing by such Subsidiary Borrower;
-4-
(e) A written opinion of counsel to such Subsidiary
Borrower in form and substance satisfactory to the Agent and the Banks,
pertaining to such Subsidiary Borrower and the Loan Documents to which
it is a party, substantially in the form set forth in EXHIBIT "G-1" and
EXHIBIT "G-2" hereto;
(f) If requested by Bank(s) acting through the
Administrative Agent, Revolving Credit Notes executed by such Subsidiary
Borrower and payable to the order of each of the requesting Banks;
(g) A Parent Guaranty executed by the Company, together
with (i) copies of resolutions of the board of directors of the Company
authorizing execution, delivery and performance of the Parent Guaranty,
(ii) a certificate of the Secretary or Assistant Secretary of the
Company certifying the name and the true signature of the officer of the
Company authorized to execute and deliver the Parent Guaranty and (iii)
an opinion of counsel to the Company, substantially in the form of
EXHIBIT G-1 and EXHIBIT G-2 hereto, pertaining to the Parent Guaranty;
and
(h) Such other documents as the Majority Banks through the
Administrative Agent may have reasonably requested.
1.4 AMENDMENTS TO ARTICLE VI.
(a) SUBSECTIONS (A) AND (B) of SECTION 6.01 are hereby amended so
as to delete all references to consolidating balance sheets and consolidating
statements of income, shareholders' equity and cash flows.
(b) SUBSECTION (C) of SECTION 6.01 is hereby deleted in its
entirety.
1.5 AMENDMENTS TO ARTICLE VII.
(a) SUBSECTION (L) of SECTION 7.01 is hereby amended by deleting
the number "$10,000,000" and inserting the following words in lieu thereof: "an
amount equal to fifteen percent (15%) of Net Worth determined as of the last day
of the period covered by the financial statements most recently delivered
pursuant to SECTION 6.01."
(b) SUBSECTION (G) of SECTION 7.01 is hereby amended by deleting
the number "$2,000,000" and inserting the following number in lieu thereof:
"$10,000,000".
(c) SUBSECTION (B) of SECTION 7.10 is hereby amended by deleting
"40%" and substituting "50%" therefor.
(d) SECTION 7.11 (Minimum Net Worth) is hereby deleted in its
entirety.
(e) SECTION 7.12 is hereby amended by deleting "2.5 to 1.0" and
substituting "3.0 to 1.0" therefor.
(f) SECTION 7.13 is hereby amended by deleting "five percent
(5%)" and substituting "ten percent (10%)" therefor.
1.6 AMENDMENT TO ARTICLE VIII. A new SUBSECTION (L) is hereby added to
SECTION 8.01 of the Credit Agreement, to read as follows:
-5-
(l) GUARANTOR. Following the execution and delivery of the Parent
Guaranty by the Company, the Parent Guaranty is for any reason partially
(including with respect to future advances) or wholly revoked or
invalidated, or otherwise ceases to be in full force and effect, or the
Company contests the validity or enforceability thereof or denies that
it has any further liability or obligation thereunder, or any other
Person contests the validity or enforceability thereof.
1.7 AMENDED SCHEDULE 2.01. SCHEDULE 2.01 to the Credit Agreement is
hereby deleted in its entirety and an amended SCHEDULE 2.01 in the form attached
hereto is hereby substituted therefor.
1.8 AMENDED SCHEDULE 2.02. SCHEDULE 2.02 to the Credit Agreement is
hereby deleted in its entirety and an amended SCHEDULE 2.02 in the form attached
hereto is hereby substituted therefor.
1.9 AMENDED EXHIBIT "B-1". EXHIBIT "B-1" (form of Parent Guaranty) is
hereby deleted in its entirety and an amended EXHIBIT "B-1" in the form attached
hereto is hereby, substituted therefor. EXHIBIT "B-2" (form of Domestic
Subsidiary Guaranty) is hereby deleted in its entirety.
1.10 NEW EXHIBIT "I". Exhibit "I" (Subsidiary Borrower Counterpart) is
hereby added to the Credit Agreement in the form attached hereto.
SECTION 2. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Agents and to each of the Banks that:
2.1 This Third Amendment and the Credit Agreement as amended hereby, has
been duly authorized, executed and delivered by the Company and constitute its
legal, valid and binding obligations enforceable in accordance with their
respective terms (subject, as to the enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium and similar laws affecting
creditors' rights generally and to general principles of equity).
2.2 The representations and warranties set forth in ARTICLE V of the
Credit Agreement are true and correct in all material respects before and after
giving effect to this Third Amendment with the same effect as if made on the
date hereof, except to the extent such representations and warranties expressly
related to an earlier date, in which case they were true and correct in all
material respects on and as of such earlier date.
2.3 As of the date hereof, at the time of and immediately after giving
effect to this Third Amendment, no Default or Event of Default has occurred and
is continuing.
SECTION 3. EFFECTIVE DATE. This Third Amendment shall be effective on
the date of delivery to the Administrative Agent of (a) this Third Amendment,
signed by the Company, the Agents and each of the Banks, and (b) a certificate
of the Secretary or Assistant Secretary of the Company, certifying copies of
resolutions of the Company's board of directors authorizing execution and
delivery of this Third Amendment and certifying the name(s) and true
signature(s) of the officer(s) of the Company signing this Third Amendment.
SECTION 4. EFFECT OF AMENDMENT. This Third Amendment (i) except as
expressly provided herein, shall not be deemed to be a consent to the
modification or waiver of any other term or condition of the Credit Agreement or
of any of the instruments
-6-
or agreements referred to therein and (ii) shall not prejudice any right or
rights which the Administrative Agent or the Banks may now have under or in
connection with the Credit Agreement, as amended by this Third Amendment. Except
as otherwise expressly provided by this Third Amendment, all of the terms,
conditions and provisions of the Credit Agreement shall remain the same. It is
declared and agreed by each of the parties hereto that the Credit Agreement, as
amended hereby, shall continue in full force and effect, and that this Third
Amendment and such Credit Agreement shall be read and construed as one
instrument.
SECTION 5. MISCELLANEOUS. This Third Amendment shall for all purposes be
construed in accordance with and governed by the laws of the State of New York.
The captions in this Third Amendment are for convenience of reference only and
shall not define or limit the provisions hereof. This Third Amendment may be
executed in separate counterparts, each of which when so executed and delivered
shall be an original, but all of which together shall constitute one instrument.
In proving this Third Amendment, it shall not be necessary to produce or account
for more than one such counterpart.
[SIGNATURES BEGIN ON THE FOLLOWING PAGE]
-7-
NO ORAL AGREEMENTS. THE CREDIT AGREEMENT (AS AMENDED BY THIS THIRD
AMENDMENT) AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment
to be duly executed and delivered by their proper and duly authorized officers
as of the date and year first above written.
XXXXXXXXXXX ENTERRA, INC.
By:/s/
-----------------------------------
Xxxxxx X. Xxxxx
Senior Vice President, Chief
Financial Officer and Treasurer
(SIGNATURES CONTINUED ON FOLLOWING PAGE)
-8-
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Documentation Agent and as a
Bank
By:/s/
--------------------------------------------
Xxxxxx Xxx
Managing Director
TEXAS COMMERCE BANK NATIONAL ASSOCIATION, as
Administrative Agent and as a Bank
By:/s/
--------------------------------------------
Xxxx Xxxx
Vice President
BANK OF MONTREAL
By:/s/
--------------------------------------------
Name:
Title:
THE BANK OF NEW YORK
By:/s/
--------------------------------------------
Name:
Title:
THE BANK OF NOVA SCOTIA
By:/s/
--------------------------------------------
Name:
Title:
THE BANK OF TOKYO-MITSUBISHI, LTD.,
successor to The Mitsubishi Bank, Limited
By:/s/
--------------------------------------------
Name:
Title:
THE FUJI BANK, LIMITED
By:/s/
--------------------------------------------
Name:
Title:
NATIONSBANK OF TEXAS, N.A.
By:/s/
--------------------------------------------
Name:
Title:
STANDARD CHARTERED BANK
By:/s/
--------------------------------------------
Name:
Title:
By:/s/
--------------------------------------------
Name:
Title:
XXXXX FARGO BANK (TEXAS), NATIONAL
ASSOCIATION, successor to First Interstate
Bank of Texas, N.A.
By:/s/
--------------------------------------------
Name:
Title:
-10-
THE YASUDA TRUST AND BANKING COMPANY,
LIMITED
By:/s/
--------------------------------------------
Name:
Title:
-11-
SCHEDULE 2.01
-------------
COMMITMENTS
-----------
AND PRO RATA SHARES
-------------------
REVOLVING LOAN PRO RATA
BANK COMMITMENT SHARE
---- ---------- -----
Bank of America National Trust and Savings
Association (Agent) ............................... $ 27,500,000 13.7500%
Texas Commerce Bank National Association
(Agent) ........................................... $ 27,500,000 13.7500%
Bank of Montreal (Co-Agent) ....................... $ 20,000,000 10.0000%
The Bank of Tokyo-Mitsubishi, Ltd. ................
(Co-Agent) ........................................ $ 20,000,000 10.0000%
The Bank of New York .............................. $ 15,000,000 7.5000%
The Bank of Nova Scotia ........................... $ 15,000,000 7.5000%
The Fuji Bank, Limited ............................ $ 15,000,000 7.5000%
NationsBank of Texas, N.A ......................... $ 15,000,000 7.5000%
Standard Chartered Bank ........................... $ 15,000,000 7.5000%
Xxxxx Fargo Bank (Texas), National
Association ....................................... $ 15,000,000 7.5000%
The Yasuda Trust and Banking Company,
Limited ........................................... $ 15,000,000 7.5000%
------------ --------
TOTAL ..................................... $200,000,000 100.0000%
-12-
SCHEDULE 2.02
-------------
PRICING CHART
-------------
--------------------------------------------------------------------------------
Level I Level II Level III Level IV Level V
--------------------------------------------------------------------------------
Senior unsecured A-/A3 or BBB+/ BBB/ BBB-/ BB+/Ba1
long-term debt ratings Better Xxx0 Xxx0 Xxx0 or Lower
--------------------------------------------------------------------------------
Eurodollar Rate Margin
(Basis Points) 25.0 27.5 30.0 37.5 62.5
--------------------------------------------------------------------------------
Base Rate Margin (Basis
Points) 0.0 0.0 0.0 0.0 0.0
--------------------------------------------------------------------------------
Commitment Fee (Basis
Points) 9.0 10.0 15.0 17.5 20.0
--------------------------------------------------------------------------------
EXHIBIT "I"
SUBSIDIARY BORROWER COUNTERPART
Date:________ , 199__
Texas Commerce Bank National
Association, as Administrative Agent
Re: CREDIT AGREEMENT dated as of October 5, 1995, as amended, among
XXXXXXXXXXX ENTERRA, INC., a Delaware corporation (the
"COMPANY"), the several financial institutions party thereto
(collectively, the "BANKS"), BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as the documentation agent for the Banks,
and TEXAS COMMERCE BANK NATIONAL ASSOCIATION, as the
administrative agent for the Banks
Ladies and Gentlemen:
Reference is made to the Credit Agreement described above. All
capitalized terms used but not defined herein shall have the meanings set forth
in the Credit Agreement.
The undersigned, [NAME OF SUBSIDIARY BORROWER] , a [JURISDICTION OF
ORGANIZATION] [TYPE OF ENTITY] , hereby elects to be a Subsidiary Borrower for
purposes of the Credit Agreement, effective from the date hereof. The
undersigned confirms that the representations and warranties made by Borrowers
under ARTICLE V of the Credit Agreement are true and correct in all material
respects as to the undersigned as of the date hereof (except such
representations and warranties which expressly refer to an earlier date, which
are true and correct in all material respects as of such earlier date), and the
undersigned hereby agrees to perform all the obligations of a Subsidiary
Borrower under, and to be bound in all respects by the terms of, the Credit
Agreement, including without limitation, SECTION 10.18 thereof, as if the
undersigned were a signatory party thereto.
The address to which all notices to the undersigned under the Credit
Agreement should be directed is: . This instrument shall be construed in
accordance with and governed by the laws of the State of New York (without
regard to principles of conflicts of laws) and applicable federal law.
This Subsidiary Borrower Counterpart shall be effective as to the
undersigned on the satisfaction of the conditions precedent set forth in SECTION
4.03 of the Credit Agreement.
Very truly yours,
[SUBSIDIARY BORROWER]
By___________________________
Name:
Title:
Exhibit "I" - Page 1
GUARANTOR ACKNOWLEDGMENT
The undersigned hereby agrees and confirms (i) that [SUBSIDIARY
BORROWER] is a Subsidiary Borrower for purposes of the Credit Agreement
described above, and (ii) that the Parent Guaranty executed by it in favor of
the Banks and the Agent continues in full force and effect on and after the
execution and effectiveness hereof.
XXXXXXXXXXX ENTERRA, INC.
By:______________________
Name:
Title:
TEXAS COMMERCE BANK NATIONAL ASSOCIATION, as
Administrative Agent, hereby accepts the
foregoing Subsidiary Borrower Counterpart
By:______________________
Name:
Title:
