THIRD AMENDMENT
TO
CREDIT AGREEMENT
Among
MISSION RESOURCES CORPORATION,
as Borrower,
JPMORGAN CHASE BANK,
as Administrative Agent,
BNP PARIBAS,
as Syndication Agent,
WACHOVIA BANK, NATIONAL ASSOCIATION
AND
FLEET NATIONAL BANK,
as Co-Documentation Agents,
and
The Lenders Signatory Hereto
Effective as of October 7, 2002
THIRD AMENDMENT TO CREDIT AGREEMENT
This THIRD AMENDMENT TO CREDIT AGREEMENT (this "Third Amendment") executed
effective as of the 7th of October, 2002 (the "Effective Date") is among MISSION
RESOURCES CORPORATION, a corporation 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 (collectively, the "Lenders"); JPMORGAN CHASE BANK (formerly
known as The Chase Manhattan Bank), as administrative agent for the Lenders (in
such capacity, together with its successors, the "Administrative Agent"), BNP
PARIBAS, as syndication agent for the Lenders (in such capacity, together with
its successors, the "Syndication Agent"); and WACHOVIA BANK, NATIONAL
ASSOCIATION (formerly known as First Union National Bank) and FLEET NATIONAL
BANK, as co-documentation agents for the Lenders (in such capacity, together
with each of their successors, the "Co-Documentation Agents").
Recitals
A. The Borrower, the Agents and the Lenders are parties to that certain
Credit Agreement dated as of May 16, 2001, as amended by that certain First
Amendment to Credit Agreement dated as of May 29, 2001, as amended by that
certain Second Amendment to Credit Agreement dated as of March 28, 2002 (such
agreement, as amended, 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 Agents 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 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 Amendments to Section 1.02.
(a) The definition of "Agreement" is hereby amended to read as follows:
"Agreement" shall mean this Credit Agreement, as amended by the First
Amendment, as amended by the Second Amendment, as amended by the Third
Amendment, and as further amended from time to time.
(b) The definition of "Cash Equivalent" is hereby added where
alphabetically appropriate:
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"Cash Equivalents" shall mean investments of the type described in
Sections 9.05(c), (d), (e) or (f).
(c) The definition of "Consolidated Net Income" is hereby amended by
inserting the phrase "or any non-recurring items, including, but not limited to,
contract termination fees and associated expenses, system conversion costs,
legal settlements, severance and termination costs, costs associated with merger
and acquisition and capital offering efforts, and other similar expenses or
charges," between the words "losses" and "during" in subsection (iv) thereof.
(d) The following definition of "Third Amendment" is hereby added where
alphabetically appropriate:
"Third Amendment" shall mean that certain Third Amendment to Credit
Agreement dated as of October 7, 2002 among the Borrower, the Guarantors,
the Agents and the Lenders.
2.2 Section 2.07(b). Section 2.07(b) is hereby amended by inserting the new
clause (iv), which reads in its entirety as follows:
(iv) If the Borrower and its Consolidated Restricted Subsidiaries
shall hold cash and Cash Equivalents exceeding $12,000,000.00 in the
aggregate for any period of three consecutive Business Days, then the
Borrower shall prepay the Loans on the first Business Day immediately
following such three consecutive Business Day period in an aggregate
principal amount equal to the excess of the fair market value, as
determined by the Administrative Agent, of the cash and Cash Equivalents
held by the Borrower and its Consolidated Restricted Subsidiaries on such
Business Day over $12,000,000.00.
2.3 Section 8.09(a).
(a) Section 8.09(a) is hereby amended by deleting the percentage "80%" in
each place at which it appears therein and inserting in lieu thereof the
percentage "90%."
(b) Section 8.09(a) is hereby further amended by adding the following
sentence at the end thereof, which reads in its entirety as follows:
"In the event that on the effective date of the Third Amendment, the
Borrower is not in compliance with this Section 8.09(a) as a result of the
modifications made pursuant to the Third Amendment, then such
non-compliance will not be a Default or Event of Default for a period of 30
days during which it is expected the Borrower will achieve compliance."
2.4 Section 9.01. Section 9.01 is hereby amended by deleting subsections
(a) and (b) thereof and inserting in lieu thereof the following:
(a) Interest Coverage Ratio. The Borrower will not, as of the last day of
any fiscal quarter set forth below, permit its ratio of EBITDAX for the period
of four fiscal quarters then ending to Interest Expense for such period to be
less than the ratio set forth below:
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Fiscal Quarter Interest Coverage Ratio
-------------- -----------------------
9/30/02 through 3/31/03 1.75 to 1.00
4/1/03 through 6/30/03 1.90 to 1.00
7/1/03 through 9/30/03 2.10 to 1.00
10/1/03 through 12/31/03 2.30 to 1.00
1/1/04 and thereafter 2.50 to 1.00.
(b) Ratio of Total Debt to EBITDAX. The Borrower will not, at any time
during any period set forth below, permit its ratio of Total Debt as of such
time during such period to EBITDAX for the four fiscal quarters ending on the
last day of the fiscal quarter immediately preceding the date of determination
for which financial statements are available to be greater than the ratio set
forth below:
Fiscal Quarter Total Debt to EBITDAX
-------------- ---------------------
9/30/02 through 12/31/02 5.50 to 1.00
1/1/03 through 3/31/03 5.00 to 1.00
4/1/03 through 6/30/03 4.75 to 1.00
7/1/03 through 9/30/03 4.50 to 1.00
10/1/03 through 12/31/03 4.00 to 1.00
1/1/04 and thereafter 3.50 to 1.00.
2.5 Annex I. Annex I is hereby amended by deleting such annex in its
entirety and inserting in lieu thereof Annex I attached hereto.
Section 3. Borrowing Base Redetermination. The Required Lenders and the
Borrower agree that the amount of the Borrowing Base: (i) for the period from
and after the Effective Date up to and including March 30, 2003 will be
$50,000,000 (less any adjustments occurring after the Effective Date pursuant to
Section 8.08(c) or Section 9.13); and (ii) for the period from and after March
31, 2003 until the next redetermination after such date will be $40,000,000
(less any adjustments occurring after the Effective Date pursuant to Section
8.08(c) or Section 9.13). This provision does not limit the right of the parties
to initiate interim redeterminations of the Borrowing Base in accordance with
Section 2.08(e).
Section 4. Termination of Consent. That certain Consent, dated as of
August 9, 2002 among the Borrower, the Guarantors, the Agents and Lenders
parties thereto is hereby terminated.
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Section 5. 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 5, each of
which shall be reasonably satisfactory to the Administrative Agent in form and
substance:
5.1 Loan Documents. The Agent shall have received multiple counterparts as
requested of this Third Amendment from the Required Lenders.
5.2 No Default. No Default or Event of Default shall have occurred and be
continuing as of the Effective Date.
5.3 Amendment Fee. Payment by the Borrower of an amendment fee to the
Administrative Agent for the account of each Lender that (i) indicated in
writing to the Administrative Agent on or before 5:00 p.m. Houston time,
[October 2, 2002] its (A) agreement to execute this Third Amendment and (B)
approval to reset the Borrowing Base as set forth in Section 3 of this Third
Amendment, and (ii) executes and delivers a counterpart hereof to the
Administrative Agent no later than the Effective Date.
Section 6. 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 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 7. Miscellaneous.
7.1 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.
7.2 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 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.
7.3 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.
7.4 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,
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contemporaneous, or unwritten oral agreements of the parties. There are no
subsequent oral agreements between the parties.
7.5 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.
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IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to
be duly executed effective as of the date first written above.
BORROWER: MISSION RESOURCES CORPORATION
By:__________________________________
Xxxxxx X. Xxxxx
Senior Vice President -- Corporate Finance
GUARANTORS: BLACK HAWK OIL COMPANY
By:_______________________________
Xxxxxx X. Xxxxx
Senior Vice President -- Corporate Finance
MISSION HOLDINGS LLC
By:_______________________________
Xxxxxxxx X. Xxxxxxx
Manager
MISSION E&P LIMITED PARTNERSHIP
By Black Hawk Oil Company,
its general partner
By:__________________________
Xxxxxx X. Xxxxx
Senior Vice President -- Corporate Finance
PAN AMERICAN ENERGY FINANCE CORP.
By:_______________________________
Xxxxxx X. Xxxxx
Senior Vice President -- Corporate Finance
ADMINISTRATIVE AGENT: JPMORGAN CHASE BANK,
as Administrative Agent
By:__________________________________
Name:
Title:
SYNDICATION AGENT: BNP PARIBAS,
as Syndication Agent
By:__________________________________
Name:
By:__________________________________
Name:
DOCUMENTATION AGENT: WACHOVIA BANK, NATIONAL ASSOCIATION
as Documentation Agent
By:__________________________________
Name:
Title:
DOCUMENTATION AGENT: FLEET NATIONAL BANK,
as Documentation Agent
By:__________________________________
Name:
Title:
LENDERS: JPMORGAN CHASE BANK
By:__________________________________
Name:
Title:
BNP PARIBAS
By:__________________________________
Name:
Title:
By:__________________________________
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION
By:__________________________________
Name:
Title:
FLEET NATIONAL BANK
By:__________________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION
By:__________________________________
Name:
Title:
UNION BANK OF CALIFORNIA, N.A.
By:__________________________________
Name:
Title:
By:__________________________________
Name:
Title:
XXXXX FARGO BANK TEXAS, N.A.
By:__________________________________
Name:
Title:
CIBC INC.
By:__________________________________
Name:
Title:
HIBERNIA NATIONAL BANK
By:__________________________________
Name:
Title:
SOUTHWEST BANK OF TEXAS, N.A.
By:__________________________________
Name:
Title:
ANNEX I
LIST OF MAXIMUM CREDIT AMOUNTS
Aggregate Maximum Credit Amounts
Name of Lender Percentage Share Maximum Credit Amount
-------------- ---------------- ---------------------
JPMorgan Chase Bank 12.50% $ 18,750,000
BNP Paribas 12.50% $ 18,750,000
Wachovia Bank, National Association 11.25% $ 16,875,000
Fleet National Bank 11.25% $ 16,875,000
U.S. Bank National Association 10.00% $ 15,000,000
Union Bank of California, NA 10.00% $ 15,000,000
Xxxxx Fargo Bank Texas, N.A. 10.00% $ 15,000,000
CIBC Inc. 7.50% $ 11,250,000
Hibernia National Bank 7.50% $ 11,250,000
Southwest Bank of Texas, N.A. 7.50% $ 11,250,000
TOTAL 100.00% $150,000,000
Annex I-1
