Exhibit 10(n)
AGREEMENT AND FOURTH AMENDMENT
TO CREDIT AGREEMENT
(December 23, 1998)
THIS AGREEMENT AND FOURTH AMENDMENT TO CREDIT AGREEMENT (this
"Agreement"), dated as of December 23, 1998, is made and entered into by and
among SANTA FE ENERGY RESOURCES, INC. (the "COMPANY"), a Delaware corporation;
the financial institutions listed on the signature pages hereto (collectively,
the "BANKS"); and CHASE BANK OF TEXAS, NATIONAL ASSOCIATION ("CHASE TEXAS"),
acting in its capacity as agent for the Banks (in such capacity, the "AGENT").
The Company, the Banks and the Agent are herein sometimes called the "PARTIES".
RECITALS:
1. The Company, the Agent then acting, and certain of the Parties entered
into a Credit Agreement dated as of November 13, 1996, an Agreement and First
Amendment to Credit Agreement dated as of December 19, 1996, an Agreement and
Second Amendment to Credit Agreement dated as of May 15, 1998, and an Agreement
and Third Amendment to Credit Agreement dated as of October 19, 1998. Such
Credit Agreement, as so amended, is herein called the "CREDIT AGREEMENT".
2. The Parties desire to amend the Credit Agreement to define a new term,
"EBITDAX", to substitute "EBITDAX" for the terms "EBITDA" and "Adjusted EBITDA"
in the financial covenants contained in SECTIONS 9.10 and 9.11 of the Credit
Agreement (but not elsewhere), and to ratify, confirm and continue the Credit
Agreement as so amended.
AGREEMENTS:
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are acknowledged by
the Parties, the Parties agree as follows:
1. ADDITIONAL DEFINITIONS. There is hereby added to SECTION
1.1 of the Credit Agreement the following definitions:
""EBITDAX"" shall mean for any period Consolidated Net Earnings for
such period (calculated, for purposes of this definition only, without
taking into account extraordinary items under GAAP or capital gains or
capital losses), plus the aggregate amounts deducted in determining
Consolidated Net Earnings in respect of (a) all provisions for any
federal, state or other income taxes made by the Company and the
Restricted Subsidiaries during such period; (b) Fixed Charges of the
Company and the Restricted Subsidiaries during such period; (c)
depreciation, depletion and amortization charges of the Company and the
Restricted Subsidiaries for such period; (d) exploration expenses of the
Company and the
Restricted Subsidiaries for such period, and (e) all other non-cash
charges of the Company and the Restricted Subsidiaries for such period,
all determined in accordance with GAAP."
2. AMENDMENT OF SECTION 9.10. SECTION 9.10 of the Credit Agreement is
hereby amended to provide in its entirety as follows:
"9.10. INTEREST COVERAGE. The Company will not permit the ratio of
(a) EBITDAX for the four fiscal quarters then most recently ended to (b)
Fixed Charges on Total Debt of the Combined Group for that period to be
less than 3.00 to 1.00."
3. AMENDMENT OF SECTION 9.11. SECTION 9.11 of the Credit Agreement is
hereby amended to provide in its entirety as follows:
"9.11. SENIOR TOTAL DEBT; SPECIAL DEBT. The Company will not at any
time create, incur, assume or suffer to exist any Total Debt of the
Combined Group PARI PASSU with the Obligations other than such Total Debt
of the Combined Group which does not at any time exceed the product of (a)
3.00 times (b) EBITDAX for the four consecutive fiscal quarters then most
recently ended. The Company will not at any time create, incur, assume or
suffer to exist any Special Debt that would cause the aggregate principal
amount of Special Debt to exceed 15% of Consolidated Net Worth."
4. CONDITIONS PRECEDENT. This Agreement shall become effective on the date
(the "EFFECTIVE DATE") that each of the following conditions shall have been
satisfied or waived in the discretion of the Agent:
(a) INCUMBENCY. The Company shall have delivered to the Agent a
certificate in respect of the name and signature of each officer who (i)
is authorized to sign on its behalf this Agreement and (ii) will, until
replaced by another officer or officers duly authorized for that purpose,
act as its representative for the purposes of signing documents and giving
notices and other communications in connection with this Agreement. The
Agent and each Bank may conclusively rely on such certificates until they
receive notice in writing from the Company to the contrary.
(b) CREDIT DOCUMENTS; EXPENSES. The Company shall have duly executed
and delivered this Agreement, which shall be in substantially the form
furnished to the Banks prior to their execution of this Agreement,
together with such changes therein as the Agent may approve in its
discretion. The Company shall have paid to the Agent all fees and expenses
in the amounts previously agreed upon in writing among the Company and the
Agent and all amounts due under SECTION 8.
(c) COUNTERPARTS. The Agent shall have received counterparts of
this Agreement duly executed and delivered by or on behalf of each of the
parties thereto (or, in the case of any Bank as to which the Agent shall
not have received such a counterpart, the Agent shall have received
evidence satisfactory to it of the execution and delivery by such Bank of
a counterpart hereof).
(d) CONSENTS. The Agent shall have received evidence satisfactory to
it in its discretion that all consents of each Governmental Authority and
of each other Person, if any, required in connection with the execution,
delivery and performance of this Agreement have been received and remain
in full force and effect.
(e) OTHER DOCUMENTS. The Agent shall have received such other
documents consistent with the terms of this Agreement and relating to the
transactions contemplated hereby as the Agent may reasonably request.
(f) NO DEFAULT. No Default shall have occurred and be continuing.
(g) NO LEGAL BAR. Such effectiveness shall not violate any Legal
Requirement applicable to the Agent or any Bank.
PROVIDED, HOWEVER, that this Agreement shall not become effective or be binding
on any Party unless all of the foregoing conditions are satisfied not later than
December 31, 1998. The Agent shall promptly notify the Company and the Banks of
the Effective Date, and such notice shall be conclusive and binding on all
Parties. All provisions and payments required by this SECTION 4 are subject to
the provisions of SECTION 12.8 of the Credit Agreement.
5. REPRESENTATIONS TRUE; NO DEFAULT. The Company represents and warrants
to the Agent and each Bank that (a) the representations and warranties contained
in the Credit Agreement are true and correct on and as of the date hereof as
though made on and as of such date (except to the extent such representations
and warranties are expressly stated to be made solely as of an earlier date) and
(b) no event has occurred and is continuing which constitutes a Default under
the Credit Agreement or which upon the giving of notice or the lapse of time or
both would constitute such a Default.
6. RATIFICATION. Except as expressly amended hereby, the Credit Agreement,
as hereby amended, is in all respects ratified, confirmed and continued as the
agreement of the Parties and is, and shall continue to be, in full force and
effect and binding upon the Parties. The Company hereby agrees and acknowledges
that all of its liabilities and obligations under the Credit Agreement, as
hereby amended, remain in full force and effect and binding upon it as of the
date of this Agreement.
7. DEFINITIONS AND REFERENCES. Unless otherwise defined herein, terms used
herein which are defined in the Credit Agreement shall have the meanings therein
ascribed to them. The term "Agreement" as used in the Credit Agreement and the
term "Credit Agreement" as used in this Agreement or in any other instrument,
document or writing furnished to the Agent or any Bank by or on behalf of the
Company shall mean the Credit Agreement as hereby amended.
8. EXPENSES; ADDITIONAL INFORMATION. The Company shall pay to the Agent on
demand (i) all out-of-pocket expenses (including fees and disbursements of
special counsel to the Agent and expenses of syndication) in connection with the
preparation and administration of this Agreement, any waiver or consent
hereunder and any amendment hereof, and (ii) if an Event of Default occurs, all
out-of-pocket expenses incurred by the Agent and each Bank, including fees and
disbursements of counsel, in connection with such Event of Default and
collection, bankruptcy, insolvency and other enforcement proceedings resulting
therefrom.
9. SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any person or circumstances shall, to any extent, be
deemed invalid or unenforceable, the remainder of this Agreement, or the
application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby and this Agreement shall be valid and enforced to the fullest extent
permitted by applicable law. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining portions thereof or affecting the validity or
enforceability of such provision in any other jurisdiction and, to this end, the
provisions of this Agreement are severable.
10. MISCELLANEOUS. This Agreement (a) shall be binding upon and inure to
the benefit of the Company, the Agent and the Banks and their respective
successors and assigns (however, the Company may not assign its rights hereunder
without the express prior written consent of all Banks); (b) may be modified or
amended only in the manner prescribed for amendments to the Credit Agreement in
SECTION 12.5 of the Credit Agreement; (c) SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS (TO THE EXTENT PERMITTED BY LAW,
OTHER THAN ITS CONFLICT OF LAW RULES) AND OF THE UNITED STATES OF AMERICA; (d)
may be executed in several counterparts, and by the Parties on separate
counterparts, and each counterpart, when so executed and delivered, shall
constitute an original agreement, and all such separate counterparts shall
constitute but one and the same agreement, and (e) embodies the entire agreement
and understanding among the Parties with respect to the subject matter hereof
and supersedes all prior agreements, consents and understandings relating to
such subject matter. The headings herein shall be accorded no significance in
interpreting this Agreement.
11. THIS AGREEMENT REPRESENTS THE FINAL AGREEMENT AMONG THE PARTIES AS TO
THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized officers effective as of the date provided
herein.
SANTA FE ENERGY RESOURCES, INC.
By:______________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇
Senior Vice President-Finance
Chief Financial Officer and Treasurer
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, individually and as
Administrative Agent
By:__________________________________
Name:________________________________
Title:_______________________________
ABN AMRO BANK N.V.,
Individually and as a Co-Agent
By:__________________________________
Name:________________________________
Title:_______________________________
By:__________________________________
Name:________________________________
Title:_______________________________
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION,
Individually and as a Co-Agent
By:__________________________________
Name:________________________________
Title:_______________________________
THE FIRST NATIONAL BANK OF CHICAGO,
Individually and as a Co-Agent
By:__________________________________
Name:________________________________
Title:_______________________________
NATIONSBANK, N.A.(successor by merger to
NationsBank of Texas, N.A.), Individually
and as a Co-Agent
By:__________________________________
Name:________________________________
Title:_______________________________
▇▇▇▇▇ FARGO BANK (TEXAS), N.A.,
Individually and as a Co-Agent
By:__________________________________
Name:________________________________
Title:_______________________________
BANK OF MONTREAL
By:__________________________________
Name:________________________________
Title:_______________________________
PNC BANK, NATIONAL ASSOCIATION
By:__________________________________
Name:________________________________
Title:_______________________________
COMERICA BANK - TEXAS
By:__________________________________
Name:________________________________
Title:_______________________________