Contract
Exhibit
10.1
Third
Amendment
to
Among
as
Borrower,
BNP
Paribas,
as
Administrative Agent,
and
The
Lenders Signatory Hereto
Effective
as of October 24, 2007
Third
Amendment to Credit Agreement
This
Third Amendment to Credit Agreement (this “Third Amendment”) executed
effective as of October 24, 2007 (the “Third Amendment Effective Date”)
is among Legacy Reserves LP, a limited partnership formed under the laws
of the
State of Delaware (the “Borrower”); each of the undersigned guarantors
(the “Guarantors”, and together with the Borrower, the
“Obligors”); each of the Lenders that is a signatory hereto; and BNP
Paribas, as administrative agent for the Lenders (in such capacity, together
with its successors, the “Administrative Agent”).
Recitals
A. The
Borrower, the Administrative Agent and the Lenders are parties to that certain
Credit Agreement dated as of March 15, 2006 (as amended to date, the “Credit
Agreement”), pursuant to which the Lenders have made certain credit
available to and on behalf of the Borrower.
B. The
Borrower has requested and the Administrative Agent and the Lenders have
agreed
to amend certain provisions of the Credit Agreement.
C. NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein
contained, for good and valuable consideration, the receipt and sufficiency
of
which are hereby acknowledged, the parties hereto agree as follows:
Section
1. Defined
Terms. Each capitalized term which is defined in the Credit
Agreement, but which is not defined in this Third Amendment, shall have the
meaning ascribed to such term in the Credit Agreement. Unless
otherwise indicated, all section references in this Third Amendment refer
to the
Credit Agreement.
Section
2. Amendments
to Credit Agreement.
2.1 Definitions. Section
1.02 is hereby amended by amending and restating the following definitions
as
follows:
“
‘Agreement’ means this Credit Agreement, as amended by that certain First
Amendment to Credit Agreement, dated as of July 7, 2006, the Second Amendment
to
Credit Agreement, dated as of May 3, 2007, and the Third Amendment to Credit
Agreement, dated as of October 24, 2007, and as the same may from time to
time
be further amended, modified, supplemented or restated.”
“
‘Applicable Margin’ means, for any day, with respect to any ABR Loan or
Eurodollar Loan, as the case may be, the rate per annum set forth in the
Borrowing Base Utilization Grid below based upon the Borrowing Base Utilization
Percentage then in effect:
Borrowing
Base Utilization Percentage
|
Eurodollar
Loans
|
ABR
Loans
|
|
Level
1
|
less
than 33%
|
1.000%
|
0.000%
|
Level
2
|
greater
than or equal to 33%, but less than 66%
|
1.250%
|
0.000%
|
Level
3
|
greater
than or equal to 66%, but less than 85%
|
1.500%
|
0.125%
|
Level
4
|
greater
than or equal to 85%
|
1.750%
|
0.250%
|
Each
change in the Applicable Margin shall apply during the period commencing
on the
effective date of such change and ending on the date immediately preceding
the
effective date of the next such change, provided, however, that if at any
time
the Borrower fails to deliver a Reserve Report pursuant to Section 8.12(a),
then
the “Applicable Margin” means the rate per annum set forth on the grid when the
Borrowing Base Utilization Percentage is at its highest level.”
2.2 Annex
I. Annex I is hereby amended and restated in its entirety with
the Annex I attached hereto.
Section
3. Assignment
to New Lenders; Borrowing Base.
3.1 New
Lender. For an agreed consideration, each of the Lenders party to
the original Credit Agreement hereby irrevocably sells and assigns to Fortis
Capital Corp. and Compass Bank (the “New Lenders”), and each of the New
Lenders, by its signature hereto, hereby irrevocably purchases and assumes
from
the existing Lenders, subject to and in accordance with the Credit Agreement,
as
of the Third Amendment Effective Date (i) such Lenders’ rights and obligations
in their capacities as Lenders under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related
to the
amount and percentage interest identified on the attached Annex I, of
such outstanding rights and obligations of such Lenders under the Credit
Agreement and (ii) to the extent permitted to be assigned under applicable
law,
all claims, suits, causes of action and any other right of the Administrative
Agent and the other Lenders against any Person, whether known or unknown,
arising under or in connection with the Credit Agreement, any other documents
or
instruments delivered pursuant thereto or the loan transactions governed
thereby
or in any way based on or related to any of the foregoing, including contract
claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity related to the rights and obligations sold and assigned
pursuant to clause (i) above.
3.2 Borrowing
Base. For the period from and including the Third Amendment
Effective Date to but excluding the next Redetermination Date, the amount
of the
Borrowing Base shall be equal to $225,000,000. Notwithstanding the
foregoing, the Borrowing Base may be subject to further adjustments from
time to
time pursuant to Section 8.13(c) or Section 9.12(d).
Section
4. Conditions
Precedent. The effectiveness of this Third Amendment is subject
to the receipt by the Administrative Agent of the following documents and
satisfaction of the other conditions provided in this Section 4, each of
which shall be reasonably satisfactory to the Administrative Agent in form
and
substance:
4.1 Third
Amendment. The Administrative Agent shall have received multiple
counterparts as requested of this Third Amendment from each Lender and the
Borrower.
4.2 Secretary’s
Certificates. The Administrative Agent shall have received a
certificate of the Borrower and of each Guarantor (a) setting forth resolutions
of the board of directors or other managing body with respect to the
authorization of the Borrower or such Guarantor to execute and deliver the
Loan
Documents to which it is a party and to enter into the transactions contemplated
in those documents, and (b) certifying that there has been no change to either
(i) the individuals who are authorized to sign the Loan Documents to which
the
Borrower or such Guarantor is a party and (ii) the articles or certificate
of
incorporation or formation and bylaws, operating agreement or partnership
agreement, as applicable, of the Borrower and each Guarantor, in each case,
since the Effective Date. The Administrative Agent and the Lenders
may conclusively rely on such certificate until the Administrative Agent
receives notice in writing from the Borrower to the contrary.
4.3 Good
Standing Certificates. The Administrative Agent shall have
received certificates of the appropriate State agencies with respect to the
existence, qualification and good standing of the Borrower and each Guarantor,
if any.
4.4 Compliance
Certificate. The Administrative Agent shall have received a
compliance certificate, which shall be substantially in the form of Exhibit
B to
the Credit Agreement, duly and properly executed by a Responsible Officer
and
dated as of the Third Amendment Effective Date.
4.5 Notes. The
Administrative Agent shall have received a Note payable to the order of each
Lender in the amount of such Lender’s Commitment after giving effect to the
assignment and increase in commitments pursuant to this Third Amendment,
duly
executed and delivered by Borrower, to be dated as of the Third Amendment
Effective Date.
4.6 Amendments
to Security Documents. The Administrative Agent shall have
received from each party thereto duly executed counterparts (in such number
as
may be requested by the Administrative Agent) of amendments to the Deed of
Trust, Mortgage, Line of Credit Mortgage, Fixture Filing, Assignment of
As-Extracted Collateral, Security Agreement and Financing Statement from
Legacy
Reserves Operating LP.
4.7 Legal
Opinion. The Administrative Agent shall have received an opinion
of Xxxxxxx & Xxxxx, L.L.P., special counsel to the Borrower, in form and
substance satisfactory to the Administrative Agent, as to such matters incident
to this Third Amendment as the Administrative Agent may reasonably
request.
4.8 No
Default. No Default or Event of Default shall have occurred and
be continuing as of the Third Amendment Effective Date.
Section
5. Representations
and Warranties; Etc. Each Obligor hereby affirms: (a)
that as of the date of execution and delivery of this Third Amendment, all
of
the representations and warranties contained in each Loan Document to which
such
Obligor is a party are true and correct in all material respects as though
made
on and as of the Third Amendment Effective Date (unless made as of a specific
earlier date, in which case, was true as of such date); and (b) that after
giving effect to this Third Amendment and to the transactions contemplated
hereby, no Defaults exist under the Loan Documents or will exist under the
Loan
Documents.
Section
6. Miscellaneous.
6.1 Confirmation. The
provisions of the Credit Agreement (as amended by this Third Amendment) shall
remain in full force and effect in accordance with its terms following the
effectiveness of this Third Amendment.
6.2 Ratification
and Affirmation of Obligors. Each of the Obligors hereby
expressly (i) acknowledges the terms of this Third Amendment, (ii) ratifies
and
affirms its obligations under the Guaranty Agreement and the other Security
Instruments to which it is a party, (iii) acknowledges, renews and extends
its
continued liability under the Guaranty Agreement and the other Security
Instruments to which it is a party and (iv) agrees that its guarantee under
the
Guaranty Agreement and the other Security Instruments to which it is a party
remains in full force and effect with respect to the Indebtedness as amended
hereby.
6.3 Counterparts. This
Third Amendment may be executed by one or more of the parties hereto in any
number of separate counterparts, and all of such counterparts taken together
shall be deemed to constitute one and the same instrument.
6.4 No
Oral Agreement. This written Third Amendment, the Credit
Agreement and the other Loan Documents executed in connection herewith and
therewith represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or unwritten oral agreements
of the parties. There are no subsequent oral agreements between the
parties.
6.5 Governing
Law. This Third Amendment (including, but not limited to, the
validity and enforceability hereof) shall be governed by, and construed in
accordance with, the laws of the State of Texas.
IN
WITNESS WHEREOF, the parties hereto have caused this Third Amendment to
be duly
executed effective as of the date first written above.
BORROWER: |
By: Legacy Reserves GP, LLC, its general
partner
|
||
|
By:
|
/s/ Xxxxxx X. Xxxxxx | |
Xxxxxx X. Xxxxxx | |||
President, Chief Financial Officer and Secretary | |||
GUARANTORS: |
LEGACY
RESERVES OPERATING LP
By: Legacy Reserves Operating GP, LLC,
its
general partner
|
||
|
By:
|
/s/ Xxxxxx X. Xxxxxx | |
Xxxxxx X. Xxxxxx | |||
President, Chief Financial Officer and Secretary | |||
LEGACY RESERVES OPERATING GP, LLC | |||
|
By:
|
/s/ Xxxxxx X. Xxxxxx | |
Xxxxxx X. Xxxxxx | |||
President, Chief Financial Officer and Secretary | |||
LEGACY RESERVES SERVICES, INC. | |||
|
By:
|
/s/ Xxxxxx X. Xxxxxx | |
Xxxxxx X. Xxxxxx | |||
President, Chief Financial Officer and Secretary | |||
ADMINISTRATIVE AGENT: |
BNP
PARIBAS
as Administrative Agent and Lender
|
||
|
By:
|
/s/ Xxxxxxx Xxxx | |
Xxxxxxx Xxxx | |||
Vice President | |||
|
By:
|
/s/ Xxxxxx Xxxx | |
Xxxxxx Xxxx | |||
Vice President | |||
LENDERS: | BANK OF AMERICA N.A. | ||
|
By:
|
/s/ Xxxxx X. Xxxxxx | |
Xxxxx X. Xxxxxx | |||
Vice President | |||
COMERICA BANK | |||
|
By:
|
/s/ Xxxx Xxxxx | |
Xxxx Xxxxx | |||
Senior Vice President | |||
KEYBANK N.A. | |||
|
By:
|
/s/ Xxxxxx Xxxxx | |
Xxxxxx Xxxxx | |||
Director | |||
WACHOVIA BANK, NATIONAL ASSOCIATION | |||
|
By:
|
/s/ Xxxxxx X. Xxxxxxxx | |
Xxxxxx X. Xxxxxxxx | |||
Director | |||
NEW LENDER: | FORTIS CAPITAL CORP. | ||
|
By:
|
/s/ Xxxxx Xxxxxxxxxx | |
Xxxxx Xxxxxxxxxx | |||
Director | |||
|
By:
|
/s/ Xxxxxxx Xxxxxx | |
Xxxxxxx Xxxxxx | |||
Managing Director | |||
NEW LENDER: | COMPASS BANK | ||
|
By:
|
/s/ Xxxxxxxx X. Xxxxx | |
Xxxxxxxx X. Xxxxx | |||
Senior Vice President | |||