EXHIBIT 4.6.1
SECOND AMENDMENT
TO
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
(herein called this "Amendment") made as of June 4, 2002 by and among Chesapeake
Exploration Limited Partnership, an Oklahoma limited partnership ("Borrower"),
Chesapeake Energy Corporation, an Oklahoma corporation ("Company"), Bear ▇▇▇▇▇▇▇
Corporate Lending Inc., as syndication agent ("Syndication Agent"), Union Bank
of California, N.A., as administrative agent and collateral agent
("Administrative Agent"), and the several banks and other financial institutions
or entities parties hereto ("Lenders").
WITNESSETH:
WHEREAS, Borrower, Company, Syndication Agent, Administrative Agent and
Lenders entered into that certain Second Amended and Restated Credit Agreement
dated as of June 11, 2001 (as amended, supplemented, or restated to the date
hereof, the "Original Agreement"), for the purpose and consideration therein
expressed, whereby Lenders became obligated to make loans to Borrower as therein
provided; and
WHEREAS, Borrower, Company, Syndication Agent, Administrative Agent and
Lenders desire to amend the Original Agreement as set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein and in the Original Agreement, in
consideration of the loans which may hereafter be made by Lenders to Borrower,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto do hereby agree as follows:
ARTICLE I.
Definitions and References
Section 1.1. Terms Defined in the Original Agreement. Unless the
context otherwise requires or unless otherwise expressly defined herein, the
terms defined in the Original Agreement shall have the same meanings whenever
used in this Amendment.
Section 1.2. Other Defined Terms. Unless the context otherwise
requires, the following terms when used in this Amendment shall have the
meanings assigned to them in this Section 1.2.
"Amendment" means this Second Amendment to Second Amended and
Restated Credit Agreement.
"Credit Agreement" means the Original Agreement as amended
hereby.
ARTICLE II.
Amendments and Waivers
Section 2.1. Defined Terms. Section 1.1 of the Original Agreement is
hereby amended to add the following definitions of Pari Passu Lender Hedging
Obligations and Lender Hedging Obligations:
"'Pari Passu Lender Hedging Obligations' means any Lender Hedging
Obligations up to a maximum aggregate amount of $30,000,000 to the extent
arising under a Hedge Agreement that explicitly states that such obligations are
intended to be Pari Passu Lender Hedging Obligations under this Agreement."
"'Lender Hedging Obligations' means all obligations arising from time
to time under Hedge Agreements entered into from time to time between the
Company or the Borrower and a Lender or an affiliate of a Lender which are
within the definition of secured indebtedness under the Mortgage."
Section 2.2. Pro Rata Treatment and Payments. Paragraph (f) of Section
3.8 of the Original Agreement is amended in its entirety to read as follows:
"(f) Notwithstanding anything in this Section 3.8 or in any of the Loan
Documents to the contrary, in the event that the Revolving Loans shall have
become due and payable, and the Revolving Commitments shall have been
terminated, pursuant to Section 8, any amounts received by the Administrative
Agent from the Loan Parties or their Subsidiaries or from the Collateral in
respect of the Borrower's Obligations shall be applied in the following order of
priority:
(i) First, to reimburse the Administrative Agent for its fees,
costs and expenses pursuant to the Loan Documents;
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(ii) Second, to pay unpaid interest accrued on the Revolving
Loans;
(iii) Third, (A) to pay all other outstanding Obligations
(whether or not contingent) under, out of, or in connection with any of
the Loan Documents or Letters of Credit, including the outstanding
principal of the Revolving Loans and, after the payment of the
outstanding principal of the Revolving Loans, to cash collateralize
outstanding Letters of Credit (as contemplated pursuant to Section 8)
and (B) to pay Pari Passu Lender Hedging Obligations (applied ratable
to (A) and to (B) based upon the total outstanding Obligations under
(A) and the lesser of the total outstanding Pari Passu Lender Hedging
Obligations under (B) or $30,000,000); and
(iv) Fourth, once all of the foregoing Obligations (whether or
not contingent) and Pari Passu Lender Hedging Obligations have been
indefeasibly paid in full and all Letters of Credit have been
terminated or cash collateralized (as contemplated pursuant to Section
8), to the Borrower.
Agent shall have no responsibility to determine the existence or amount of Pari
Passu Lender Hedging Obligations or other Lender Hedging Obligations and may
reserve from the application of amounts under this paragraph (f) amounts
distributable in respect of Pari Passu Lender Hedging Obligations until it has
received evidence satisfactory to it of the existence and amount of such Pari
Passu Lender Hedging Obligations."
Section 2.3. Investments. Paragraph (i) of Section 7.7 of the Original
Agreement is hereby amended by deleting from the proviso "$50,000,000" and
inserting in place thereof "$100,000,000."
Section 2.4. Releases of Guarantees and Liens; Designation of
Subsidiaries. Section 10.14 of the Original Agreement is hereby amended by
amending paragraph (a) in its entirety to read as follows and adding the
following paragraph (c):
"(a) Notwithstanding anything to the contrary contained herein or in
any other Loan Document, the Administrative Agent is hereby irrevocably
authorized by each Lender (without requirement of notice to or consent of any
Lender except as expressly required by Section 10.1) to take any action
requested by the Borrower having the effect of releasing any Collateral or
guarantee obligations (i) to the extent necessary to permit consummation of any
transaction not prohibited by any Loan Document or that has been consented to in
accordance with Section 10.1
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(ii) to release Collateral to the extent provided in paragraph (c) of this
Section 10.14, or (iii) at such time as the Revolving Loans, the Reimbursement
Obligations and the other obligations under the Loan Documents (other than
obligations under or in respect of Hedge Agreements) shall have been paid in
full, the Revolving Commitments have been terminated and no Letters of Credit
shall be outstanding, the Collateral shall be released from the Liens created by
the Security Documents, and the Security Documents and all obligations (other
than those expressly stated to survive such termination) of the Administrative
Agent and each Loan Party under the Security Documents shall terminate, all
without delivery of any instrument or performance of any act by any Person."
* * *
"(c) The Administrative Agent may release a portion of the Collateral
from time to time without notice to or consent of any Lender so long as no
Default or Event of Default has occurred and is continuing, no Borrowing Base
Deficiency shall exist and the aggregate value of the Collateral released
between Determination Dates pursuant to this paragraph (c) does not exceed
$500,000, such value based upon the valuation of such Collateral at the time of
the most recent Determination Date. The Administrative Agent shall release
Collateral pursuant to this paragraph (c) only upon, and shall be protected in
relying upon, a certificate of Borrower to the effect that the conditions of the
preceding sentence exist with respect to the requested release of Collateral."
Section 2.5. Partial Release of Collateral. Borrower and Majority
Lenders hereby agree that Administrative Agent may release from the Liens under
the Loan Documents the properties listed on Schedule I hereto.
Section 2.6. Redetermination of the Borrowing Base and Collateral
Value. Borrower, Administrative Agent and Majority Lenders hereby agree that,
after giving effect to the partial release of Collateral described in Section
2.5, from the date hereof:
(a) until the next date hereafter as of which the Borrowing Base is
redetermined, the Borrowing Base shall be $225,000,000; and
(b) until the next date hereafter as of which the Collateral Value is
redetermined, the Collateral Value shall be $450,466,200.
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ARTICLE III.
Conditions of Effectiveness
Section 3.1. Effective Date. This Amendment shall become effective as
of the date first above written when and only when:
(a) Administrative Agent shall have received, at Administrative Agent's
office, duly executed and delivered and in form and substance satisfactory to
Administrative Agent, all of the following:
(i) this Amendment;
(ii) an "Omnibus Certificate" of the Secretary and of the
Chairman of the Board or President of the general partner of Borrower,
which shall contain the names and signatures of the officers of the
general partner of Borrower authorized to execute Loan Documents and
which shall certify to the truth, correctness and completeness of the
following exhibits attached thereto: (1) a copy of resolutions attached
thereto duly adopted by the Board of Directors of the general partner
of Borrower and in full force and effect at the time this Amendment is
entered into, authorizing the execution of this Amendment and the other
Loan Documents delivered or to be delivered in connection herewith and
the consummation of the transactions contemplated herein and therein,
(2) a copy of the charter documents of Borrower and of the general
partner of Borrower and all amendments thereto, certified by the
appropriate official of the Borrower's state and general partner's
state of organization, and (3) a copy of any bylaws of the general
partner of Borrower previously delivered to Agent and Lenders in
connection with the Original Agreement (which may, with respect to any
such charter documents or bylaws, reference documents previously
delivered in connection with the Original Agreement);
(iii) a "Compliance Certificate" of the Chairman of the Board
or President and of the chief financial officer of the Company, which
shall contain (1) a certification by such officers as to the
satisfaction of the conditions set out in subsections (a), (b), and (c)
of Section 5.2 of the Original Agreement and (2) the calculations
required to determine the Senior Debt Limit (along with the supporting
documentation described in Section 5.2(c) of the Original Agreement);
(iv) documents similar to those specified in subsection (ii)
of this Section with respect to each Subsidiary Guarantor (which may,
with respect to charter documents or bylaws, reference documents
previously delivered in connection with the Original Agreement); and
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(v) such other supporting documents as Administrative Agent
may reasonably request.
(b) Borrower shall have paid, in connection with such Loan Documents,
all recording, handling, amendment and other fees required to be paid to
Administrative Agent pursuant to any Loan Documents.
(c) Borrower shall have paid, in connection with such Loan Documents,
all other fees and reimbursements to be paid to Administrative Agent pursuant to
any Loan Documents, or otherwise due Administrative Agent and including fees and
disbursements of Administrative Agent's attorneys.
ARTICLE IV.
Representations and Warranties
Section 4.1. Representations and Warranties of Borrower. In order to
induce each Lender to enter into this Amendment, Borrower represents and
warrants to each Lender that:
(a) The representations and warranties contained in Section 4 of the
Original Agreement are true and correct at and as of the time of the
effectiveness hereof, except to the extent that the facts on which such
representations and warranties are based have been changed by the extension of
credit under the Credit Agreement.
(b) The Company and Borrower are duly authorized to execute and deliver
this Amendment and are and will continue to be duly authorized to borrow monies
and to perform their respective obligations under the Credit Agreement. The
Company and Borrower have duly taken all corporate or partnership action
necessary to authorize the execution and delivery of this Amendment and to
authorize the performance of the obligations of the Company and Borrower
hereunder.
(c) The execution and delivery by the Company and Borrower of this
Amendment, the performance by the Company and Borrower of its obligations
hereunder and the consummation of the transactions contemplated hereby do not
and will not conflict with any provision of law, statute, rule or regulation or
of the certificate of incorporation, bylaws, or agreement of limited partnership
of the Company or Borrower (as applicable), or of any material agreement,
judgment, license, order or permit applicable to or binding upon the Company or
Borrower, or result in the creation of any lien, charge or encumbrance upon any
assets or properties of the Company or Borrower. Except for those which have
been obtained, no
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consent, approval, authorization or order of any court or governmental authority
or third party is required in connection with the execution and delivery by the
Company and Borrower of this Amendment or to consummate the transactions
contemplated hereby.
(d) When duly executed and delivered, each of this Amendment and the
Credit Agreement will be a legal and binding obligation of the Company and
Borrower, enforceable in accordance with its terms, except as limited by
bankruptcy, insolvency or similar laws of general application relating to the
enforcement of creditors' rights and by equitable principles of general
application.
(e) The audited annual consolidated financial statements of the Company
dated as of December 31, 2001 and the unaudited quarterly consolidated financial
statements of the Company dated as of March 31, 2002 fairly present the
consolidated financial position at such dates and the consolidated statement of
operations and the changes in consolidated financial position for the periods
ending on such dates for the Company. Copies of such financial statements have
heretofore been delivered to each Lender. Since such dates no material adverse
change has occurred in the financial condition or businesses or in the
consolidated financial condition or businesses of the Company.
ARTICLE V.
Miscellaneous
Section 5.1. Ratification of Agreements. The Original Agreement as
hereby amended is hereby ratified and confirmed in all respects. Any reference
to the Credit Agreement in any Loan Document shall be deemed to be a reference
to the Original Agreement as hereby amended. The execution, delivery and
effectiveness of this Amendment shall not, except as expressly provided herein,
operate as a waiver of any right, power or remedy of Lenders under the Credit
Agreement, the Notes, or any other Loan Document nor constitute a waiver of any
provision of the Credit Agreement, the Notes or any other Loan Document.
Section 5.2. Survival of Agreements. All representations, warranties,
covenants and agreements of Borrower herein shall survive the execution and
delivery of this Amendment and the performance hereof, including without
limitation the making or granting of the Loans, and shall further survive until
all of the Obligations are paid in full. All statements and agreements contained
in any certificate or instrument delivered by the Company, Borrower or any
Subsidiary Guarantor hereunder or under the Credit Agreement to any Lender shall
be deemed to constitute
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representations and warranties by, and/or agreements and covenants of, such Loan
Party under this Amendment and under the Credit Agreement.
Section 5.3. Loan Documents. This Amendment is a Loan Document, and all
provisions in the Credit Agreement pertaining to Loan Documents apply hereto.
Section 5.4. Governing Law. This Amendment shall be governed by and
construed in accordance the laws of the State of New York and any applicable
laws of the United States of America in all respects, including construction,
validity and performance.
Section 5.5. Counterparts; Fax. This Amendment may be separately
executed in counterparts and by the different parties hereto in separate
counterparts, each of which when so executed shall be deemed to constitute one
and the same Amendment. This Amendment may be validly executed by facsimile or
other electronic transmission.
THIS 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 OF THE PARTIES.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, this Amendment is executed as of the date first
above written.
CHESAPEAKE EXPLORATION LIMITED PARTNERSHIP
By: Chesapeake Operating, Inc., its general partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
CHESAPEAKE ENERGY CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer & Sr. Vice President
Human Resources
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UNION BANK OF CALIFORNIA, N.A.
Administrative Agent, Collateral Agent,
Issuing Lender and Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Assistant Vice President
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BANK OF OKLAHOMA, N.A.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
BANK OF SCOTLAND
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
BEAR ▇▇▇▇▇▇▇ CORPORATE LENDING INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Authorized Agent
BNP PARIBAS
By: /s/ ▇▇▇▇▇ ▇▇▇▇ /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director Vice President
COMERICA BANK - TEXAS
By:
---------------------------------
Name:
Title:
COMPASS BANK
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
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CREDIT AGRICOLE INDOSUEZ
By:
---------------------------------
Name:
Title:
NATEXIS BANQUES POPULAIRES
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III
-------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III
Vice President and Group Manager
PNC BANK, NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇ ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
RZB FINANCE LLC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: First Vice President
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: First Vice President
SUMITOMO MITSUI BANKING CORPORATION
By:
---------------------------------
Name:
Title:
▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (▇▇▇▇▇), INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION
By:
---------------------------------
Name:
Title:
WASHINGTON MUTUAL BANK, FA
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
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Second Amendment
CONSENT AND AGREEMENT
By its execution below, each Guarantor hereby (i) consents to the provisions of
this Amendment and the transactions contemplated herein, (ii) ratifies and
confirms the Guarantee Agreement dated as of June 11, 2001 made by it for the
benefit of Administrative Agent and Lenders and the other Loan Documents
executed pursuant to the Credit Agreement (▇▇▇▇▇▇ Acquisition Corp. and Sap
Acquisition Corp. having become parties thereto by execution and delivery of
that certain Assumption Agreement of even date herewith), (iii) agrees that all
of its respective obligations and covenants thereunder shall remain unimpaired
by the execution and delivery of this Amendment and the other documents and
instruments executed in connection herewith, and (iv) agrees that the Guarantee
Agreement and such other Loan Documents shall remain in full force and effect.
CHESAPEAKE ENERGY CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer & Sr. Vice President Human Resources
THE ▇▇▇▇ COMPANY, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
CHESAPEAKE ACQUISITION CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
CHESAPEAKE ENERGY LOUISIANA CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
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CHESAPEAKE OPERATING, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer & Sr. Vice President Human Resources
CHESAPEAKE PANHANDLE LIMITED PARTNERSHIP
By: CHESAPEAKE OPERATING, INC., its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer & Sr. Vice President Human Resources
CHESAPEAKE ROYALTY COMPANY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
CHESAPEAKE-STAGHORN ACQUISITION L .P.
By: CHESAPEAKE OPERATING, INC., its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer & Sr. Vice President Human Resources
CHESAPEAKE LOUISIANA, L.P.
By: CHESAPEAKE OPERATING, INC., its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer & Sr. Vice President Human Resources
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GOTHIC ENERGY CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
GOTHIC PRODUCTION CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
NOMAC DRILLING CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
▇▇▇▇▇▇ ACQUISITION CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
SAP ACQUISITION CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
CHESAPEAKE MOUNTAIN FRONT CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
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