EXHIBIT 10.1
FIRST AMENDMENT TO
AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
(the "Amendment") is made and entered into as of the 17th day of May, 1999 (the
"Effective Date"), by and among CROSS TIMBERS OIL COMPANY, a Delaware
corporation ("Company"), the Banks that are signatories hereto (collectively,
the "Banks"), ▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK, as Administrative Agent
for Banks, NATIONSBANK, N.A. D/B/A BANK OF AMERICA, N.A., as Syndication Agent
for Banks and CHASE BANK OF TEXAS, N.A., as Documentation Agent for Banks.
W I T N E S S E T H:
WHEREAS, Company, ▇▇▇▇▇▇ Guaranty Trust Company of New York, as
Administrative Agent for Banks, NationsBank, N.A. d/b/a Bank of America N.A., as
Syndication Agent for Banks, Chase Bank of Texas, N.A., as Documentation Agent
for Banks, and Banks have entered into that certain Amended and Restated
Revolving Credit Agreement dated as of November 16, 1998, which amends and
restates in its entirety that certain Revolving Credit Agreement dated August
28, 1998, which amends and restates in its entirety that certain Revolving
Credit Agreement dated as of April 17, 1998, as amended (as amended and as in
effect as of the Effective Date, as amended hereby and as amended from time to
time hereafter, the "Loan Agreement").
WHEREAS, the parties hereto desire to amend the Loan Agreement as set forth
herein.
NOW, THEREFORE, in consideration of the premises herein contained and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, agree as follows:
ARTICLE I
Definitions and References
1.01 Unless otherwise specifically defined herein, each term used herein
which is defined in the Loan Agreement as in effect immediately prior to the
Effective Date shall have the meaning assigned to such term in the Loan
Agreement as so in effect. Each reference to "hereof," "hereunder," "herein"
and "hereby" and each other similar reference and each reference to "this Loan
Agreement" and each other similar reference contained in the Loan Agreement
shall from and after the Effective Date refer to the Loan Agreement as amended
hereby.
ARTICLE II
Amendments
2.01. Amendments to Article I.
A. Effective as of the Effective Date, the defined term "Applicable
Margin" as set forth in Article I of the Loan Agreement is amended in its
entirety and the following is substituted therefor:
" 'Applicable Margin' shall mean, at such times and from time to time
as the Borrowing Base Percentage then in effect is within one of the
following ranges with respect to any Borrowing, the percentage per annum
set forth below opposite the relevant type of Borrowing and the relevant
range.
Type of Borrowing Applicable Margin
A. Floating Base Borrowing:
Range 1: The Borrowing Base
Percentage is less than or equal to 75% 0.125%
Range 2: The Borrowing Base
Percentage is greater than 75% but less
than or equal to 90% 0.25%
Range 3: The Borrowing Base
Percentage is greater than 90% 0.375%
B. Eurodollar Borrowing:
Range 1: The Borrowing Base
Percentage is less than or equal to 75% 1.125%
Range 2: The Borrowing Base
Percentage is greater than 75% but less
than or equal to 90% 1.25%
Range 3: The Borrowing Base
Percentage is greater than 90% 1.375%
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C. CD Borrowing:
Range 1: The Borrowing Base
Percentage is less than or equal to 75% 1.25%
Range 2: The Borrowing Base
Percentage is greater than 75% but less
than or equal to 90% 1.375%
Range 3: The Borrowing Base
Percentage is greater than 90% 1.50%
provided, however, that with respect to any Eurodollar Borrowing or
CD Borrowing and except as provided in Section 2.03(d) below, if the
Applicable Margin for such Borrowing is established while the
Borrowing Base Percentage is within one of the ranges set forth
above, but the Borrowing Base Percentage subsequently should become
within one of the other ranges set forth above during the Interest
Period in effect for such Borrowing, then (i) if, as of the Business
Day (or Eurodollar Business Day) that the Borrowing Base Percentage
changes, 30 days or more remain until the termination of such
Interest Period, then the Applicable Margin for such Borrowing shall
automatically change on such Business Day (or Eurodollar Business
Day) without prior notice to Company to the Applicable Margin for the
actual Borrowing Base Percentage then in effect or (ii) if, as of the
Business Day (or Eurodollar Business Day) that the Borrowing Base
Percentage changes, less than 30 days remain until the termination of
such Interest Period, then the Applicable Margin then in effect shall
not change until the termination of such Interest Period."
B. Effective as of the Effective Date, subclause (i) the defined term
"Cash Flow" as set forth in Article I of the Loan Agreement is amended in
its entirety and the following is substituted therefor:
"(i) the gross cash operating revenues properly allocable to Proved
Reserves attributable to the Mineral Properties (except that at least
eighty-two percent (82%) of such Proved Reserves shall consist of
Proved Developed Producing Reserves) and operations of the Gas
Marketing Subsidiaries which are not subject to any Lien except
Permitted Liens, and"
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2.02. Amendment to Section 5.01(a)(i). Effective as of the Effective
Date, Section 5.01(a)(i) of the Loan Agreement is amended in its entirety and
the following is substituted therefor:
"(i) The PV Borrowing Base. The PV Borrowing Base shall be based upon
economic variables which evaluate the discounted present value of
future net income accruing to the Borrowing Base Assets as
established by the Reserve Reports delivered from time to time
hereunder (herein called the "Present Value of Borrowing Base
Reserves") and the Gas Subsidiaries' Loan Value as determined from
time to time. The PV Borrowing Base Test shall equal the sum of (a)
fifty percent (50%) of the Present Value of Borrowing Base Reserves
that are attributable to the Proved Reserves allocable to the
Borrowing Base Assets; provided, however, that at least eighty-two
percent (82%) of such Proved Reserves shall consist of Proved
Developed Producing Reserves, and (b) the loan value assigned to the
operations of the Gas Marketing Subsidiaries as determined according
to Section 5.07 herein (such loan value is herein called the "Gas
Subsidiaries' Loan Value"). The term "Borrowing Base Assets" shall
mean only such Mineral Properties (i) to which Company has good and
indefeasible title and (ii) which are not subject to any liens,
encumbrances or charges, except for Permitted Liens for or against
which Indebtedness is not due and payable."
2.03. Amendment to Section 5.01(a)(ii). Effective as of the Effective
Date, Section 5.01(a)(ii) of the Loan Agreement is amended in its entirety and
the following is substituted therefor:
"(ii) The Adjusted PV Borrowing Base Test. The Adjusted PV Borrowing
Base Test shall equal the remainder of (i) the quotient of (a) the
Present Value of Borrowing Base Reserves that are attributable to the
Proved Reserves allocable to the Borrowing Base Assets (provided that
at least eighty-two percent (82%) of such Proved Reserves shall
consist of Proved Developed Producing Reserves) plus the Gas
Subsidiaries' Loan Value divided by (b) 1.35, less (ii) the unpaid
principal balance of the Subordinated Indebtedness then outstanding."
ARTICLE III
Commitment and Borrowing Base.
3.01. Pursuant to Section 5.05(b) of the Loan Agreement, after giving
effect to Company's public offering of 15,000,000 units of the Proposed Royalty
Trust (also known as the Hugoton Royalty Trust), the Commitment and the
Borrowing Base are $540,000,000.
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3.02. Pursuant to Section 5.05(b) of the Loan Agreement, Company will
issue an additional 2,004,000 units of the Proposed Royalty Trust if the
underwriters for the public offering of such units elect to exercise rights of
over-allotment. If such additional units of the Proposed Royalty Trust are
offered to the public pursuant to such over-allotment prior to July 1, 1999, the
Commitment and the Borrowing Base shall be reduced by $10,000,000, effective (i)
as of the Effective Date if such sale is consummated at or prior to the
Effective Date or (ii) the date such sale is consummated if such sale is
consummated after the Effective Date, but not later than July 1, 1999.
3.03. Company has entered into a purchase and sale agreement to sell
certain Mineral Properties located in the San ▇▇▇▇ Basin area of New Mexico (the
"Property Sale"). If the Property Sale is consummated by July 1, 1999, the
Commitment and the Borrowing Base shall be reduced by $25,000,000, effective (i)
as of the Effective Date if the Property Sale is consummated at or prior to the
Effective Date or (ii) the date the Property Sale is consummated if the Property
Sale is consummated after the Effective Date, but not later than July 1, 1999.
The Property Sale and all other sales of Mineral Properties made by Company
prior to the Effective Date shall not be considered in determining the
application of Section 9.07 of the Loan Agreement for the remainder of the 1999
calendar year.
ARTICLE IV
Condition Precedent
4.01. Counterparts; Conditions to Effectiveness.
(a) Majority Banks. As to Articles II and III hereof, exclusive of
Section 2.01A hereof, this instrument shall become effective as to such Sections
(and the Loan Agreement shall be amended with the amendments referred to in such
Sections) as of the Effective Date when Administrative Agent shall have received
a duly executed counterpart hereof signed by Company and Majority Banks (or, in
the case of any Bank included within Majority Banks as to which an executed
counterpart shall not have been received, Administrative Agent shall have
received telegraphic, telex or other written confirmation from such party of
execution of a counterpart hereof by such Bank).
(b) All Banks. As to Section 2.01A hereof, this instrument shall become
effective as to such Sections (and the Loan Agreement shall be amended with the
amendments referred to in such Section) as of the Effective Date when
Administrative Agent shall have received a duly executed counterpart hereof
signed by Company and all of the Banks (or, in the case of any Bank as to which
an executed counterpart shall not have been received, Administrative Agent shall
have received telegraphic, telex or other written confirmation from such party
of execution of a counterpart hereof by such Bank).
4.02. Amendment Fee. Upon Administrative Agent's receipt of duly executed
counterparts hereof signed by Company and Majority Banks, Company shall pay to
Administrative Agent a fee in the amount derived by multiplying (i) an amount
that is equal to one tenth of one percent (1/10 of 1.0%) of the Commitment
amount in effect as of the Effective Date (after giving effect to the reduction
to the Commitment as provided in Section 3.02 or 3.03
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hereof) by (ii) the cumulative Percentage of all Banks that sign a counterpart
of this Amendment. Administrative Agent shall distribute such fee to only those
Banks that sign a counterpart of this Amendment, with each such Bank's pro rata
share of such fee being its Percentage of the fee as determined according to
this Section 4.02. The fee payable under this Section 4.02 shall be paid by
Company to Administrative Agent within three (3) Business Days after Company's
receipt of Administrative Agent's written request or invoice for same.
ARTICLE V
Ratifications, Representations and Warranties
5.01. Ratifications. The terms and provisions set forth herein shall
modify and supersede all inconsistent terms and provisions set forth in the Loan
Agreement immediately before giving effect hereto and the other Loan Papers,
and, except as expressly modified, amended, and superseded herein, the terms and
provisions of the Loan Agreement and the other Loan Papers are ratified and
confirmed and shall continue in full force and effect. Specifically, the
amendments and modifications of the Loan Agreement as set forth in this
Amendment shall supercede and are in lieu of the amendments and modifications of
the Loan Agreement that are set forth in that certain waiver letter dated April
5, 1999, executed by Company and agreed to by Majority Banks. Company and Banks
agree that the Loan Agreement, as amended hereby, and the other Loan Papers
shall continue to be legal, valid, binding and enforceable in accordance with
their respective terms.
5.02. Representations, Warranties and Agreements. Company hereby
represents and warrants to Banks that (a) the execution, delivery and
performance of the Loan Agreement as amended hereby has been authorized by all
requisite corporate action on the part of Company and will not violate the
Articles/Certificate of Incorporation or Bylaws of Company; (b) the
representations and warranties contained in the Loan Agreement, as amended
hereby, and any other Loan Papers are true and correct on and as of the date
hereof and on and as of the date of execution hereof as though made on and as of
each such date; (c) no Default or Event of Default under the Loan Agreement, as
amended hereby, has occurred and is continuing; and (d) Company is in full
compliance with all covenants and agreements contained in the Loan Agreement and
the other Loan Papers, as amended hereby.
ARTICLE VI
Miscellaneous Provisions
6.01. Reference to Loan Agreement. The other Loan Papers, and any and
all other agreements, documents or instruments now or hereafter executed and
delivered pursuant to the terms hereof or pursuant to the terms of the Loan
Agreement, as amended hereby, are hereby amended so that any reference in the
Loan Agreement and such other Loan Papers to the Loan Agreement shall mean a
reference to the Loan Agreement as amended hereby.
6.02. Expenses of Agents. As provided in the Loan Agreement, Company
agrees to pay on demand all reasonable costs and expenses incurred by Agents in
connection with the preparation, negotiation and execution of this Amendment,
including, without limitation, the costs and fees of Agent's legal counsel, and
all reasonable costs and expenses incurred by Banks
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in connection with the enforcement or preservation of any rights under the Loan
Agreement, as amended hereby, or any other Loan Papers, including, without,
limitation, the reasonable costs and fees of Agents' legal counsel. Company
shall not be responsible for the cost or expense of legal counsel of any other
Bank in connection with the preparation, execution and delivery of this
Amendment.
6.03. Counterparts. This instrument may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.
6.04. Headings. The headings, captions, and arrangements used herein
are for convenience only and shall not affect the interpretation of this
instrument.
6.05. Applicable Law. THE LOAN AGREEMENT AS AMENDED HEREBY AND ALL
OTHER LOAN PAPERS EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND
TO BE PERFORMABLE IN AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF TEXAS UNLESS THE LAWS GOVERNING NATIONAL BANKS SHALL
HAVE APPLICATION.
6.06. Final Agreement. THE LOAN AGREEMENT AS AMENDED HEREBY AND THE
OTHER LOAN PAPERS, EACH AS AMENDED HEREBY, REPRESENT THE ENTIRE EXPRESSION OF
THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF ON THE EFFECTIVE DATE THIS
AMENDMENT IS EXECUTED. THE LOAN AGREEMENT AS AMENDED HEREBY AND THE OTHER LOAN
PAPERS, AS AMENDED HEREBY, 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. NO MODIFICATION, RESCISSION,
WAIVER, RELEASE OR AMENDMENT OF ANY PROVISION OF THE LOAN AGREEMENT OR THE OTHER
LOANS PAPERS SHALL BE MADE, EXCEPT BY A WRITTEN AGREEMENT SIGNED BY COMPANY AND
EITHER BANKS OR MAJORITY BANKS, AS PROVIDED IN THE LOAN AGREEMENT.
IN WITNESS WHEREOF, this Amendment has been executed in multiple
originals and is effective as of the date first above-written.
[SIGNATURE PAGES TO FOLLOW]
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COMPANY:
CROSS TIMBERS OIL COMPANY,
a Delaware corporation
By: ▇▇▇▇ O'REAR
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▇▇▇▇ O'Rear,
Vice President and Treasurer
BANKS:
▇▇▇▇▇▇ GUARANTY TRUST COMPANY
OF NEW YORK
By: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Title: Vice President
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NATIONSBANK, N.A., dba Bank of America, N.A.
By: J. ▇▇▇▇▇ ▇▇▇▇▇▇
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J. ▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
CHASE BANK OF TEXAS, N.A.
By: ▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇
BANKBOSTON, N.A.
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title:
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▇▇▇▇▇ FARGO BANK (TEXAS), N.A.
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
FROST NATIONAL BANK, as the surviving
bank by merger of ▇▇▇▇▇▇▇ Bank and Trust,
N.A., effective May 29, 1998
By: W.H. (▇▇▇▇) ▇▇▇▇▇, III
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W.H. (▇▇▇▇) ▇▇▇▇▇, III, Senior Vice
President
ABN-AMRO BANK N.V.
By: ▇.▇. ▇▇▇▇▇▇▇
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Name: ▇. ▇. ▇▇▇▇▇▇▇
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Title: SVP
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By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Vice President
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BANK OF MONTREAL
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title: Director
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THE BANK OF NEW YORK
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Vice President
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PARIBAS
By: ▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇, Vice President
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: Managing Director
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CREDIT LYONNAIS NEW YORK BRANCH
By: PHILLIPPE SOUSTRA
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Name: Phillippe Soustra
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Title: Senior Vice President
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BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION
By: J. ▇▇▇▇▇ ▇▇▇▇▇▇
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J. ▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
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FIRST UNION NATIONAL BANK
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Senior Vice President
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BANK ONE, TEXAS, N.A.
By: WM. ▇▇▇▇ ▇▇▇▇▇▇▇
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Name: Wm. ▇▇▇▇ ▇▇▇▇▇▇▇
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Title: Vice President
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NATEXIS Banque
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
By: ▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇, Assistant Vice President
THE BANK OF NOVA SCOTIA
By: F.C.H. ▇▇▇▇▇
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Name: F.C.H. ▇▇▇▇▇
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Title: Senior Manager
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Loan Operations
COMERICA BANK-TEXAS
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Vice President
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