FIRST AMENDMENT TO
CREDIT AGREEMENT
between
MIDDLE BAY OIL COMPANY, INC.
AND
ENEX RESOURCES CORPORATION
AS BORROWER
AND
COMPASS BANK, AS AGENT AND A LENDER
BANK OF OKLAHOMA, NATIONAL ASSOCIATION,
AS A LENDER
AND
THE OTHER LENDERS SIGNATORY HERETO
Effective as of
August __, 1999
TABLE OF CONTENTS
PAGE
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ARTICLE I. DEFINITIONS....................................................1
1.01 Terms Defined Above......................................1
1.02 Terms Defined in Agreement...............................1
1.03 References...............................................1
1.04 Articles and Sections....................................2
1.05 Number and Gender........................................2
ARTICLE II. AMENDMENTS.....................................................2
2.01 Amendment of Section 1.2.................................2
2.02 Amendment of Section 2.2.................................2
2.03 Amendment of Article V...................................3
ARTICLE III. CONDITIONS.....................................................3
3.01 Receipt of Documents.....................................3
3.02 Accuracy of Representations and Warranties...............3
3.03 Matters Satisfactory to Lender...........................4
ARTICLE IV. REPRESENTATIONS AND WARRANTIES.................................4
ARTICLE V. RATIFICATION...................................................4
ARTICLE VI. MISCELLANEOUS..................................................4
6.01 Scope of Amendment.......................................4
6.02 Agreement as Amended.....................................4
6.03 Parties in Interest......................................4
6.04 Rights of Third Parties..................................4
6.05 ENTIRE AGREEMENT.........................................5
6.06 GOVERNING LAW............................................5
6.07 JURISDICTION AND VENUE...................................5
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "FIRST
AMENDMENT") is made and entered into effective as of August __, 1999, by
and between MIDDLE BAY OIL COMPANY, INC., an Alabama corporation ("MIDDLE BAY"),
and ENEX RESOURCES CORPORATION, a Delaware corporation ("ENEX") (collectively,
the "BORROWER", but with such entities constituting the Borrower being jointly
and severally liable for the Obligations and each reference herein to the
Borrower being applicable to each of such entities) and COMPASS BANK, an Alabama
state chartered banking institution ("COMPASS"), BANK OF OKLAHOMA, NATIONAL
ASSOCIATION, a national banking association ("BOK") and each other lender that
becomes a signatory hereto as provided in Section 9.1 of the Credit Agreement
(Compass and each such other lender, together with its successors and assigns,
individually a "Lender" and collectively, the "Lenders"), and Compass, as agent
for the Lenders pursuant to the terms hereof (in such capacity, together with
its successors in such capacity pursuant to the terms hereof, (the "AGENT").
W I T N E S S E T H:
WHEREAS, the above named parties did execute and exchange
counterparts of that certain Credit Agreement dated March 27, 1998, as amended
by various letter amendments (the "AGREEMENT"), to which reference is here made
for all purposes;
WHEREAS, the parties subject to and bound by the Agreement
are desirous of amending the Agreement in the particulars hereinafter set
forth;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements of the parties to the Agreement, as set forth therein, and the
mutual covenants and agreements of the parties hereto, as set forth in this
First Amendment, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
1.01 TERMS DEFINED ABOVE. As used herein, each of the terms
"AGENT," "AGREEMENT," "BOK," "BORROWER," "COMPASS," "ENEX," "MIDDLE BAY,"
"LENDERS", and "FIRST AMENDMENT," shall have the meaning assigned to such term
hereinabove.
1.02 TERMS DEFINED IN AGREEMENT. As used herein, each term
defined in the Agreement shall have the meaning assigned thereto in the
Agreement, unless expressly provided herein to the contrary.
1.03 REFERENCES. References in this First Amendment to
Article or Section numbers shall be to Articles and Sections of this First
Amendment, unless expressly stated herein to the contrary. References in this
First Amendment to "hereby," "herein," "hereinafter," "hereinabove,"
"hereinbelow," "hereof," and "hereunder" shall be to this First Amendment in
its entirety and not only to the particular Article or Section in which such
reference appears.
1.04 ARTICLES AND SECTIONS. This First Amendment, for
convenience only, has been divided into Articles and Sections and it is
understood that the rights, powers, privileges, duties, and other legal
relations of the parties hereto shall be determined from this First Amendment
as an entirety and without regard to such division into Articles and Sections
and without regard to headings prefixed to such Articles and Sections.
1.05 NUMBER AND GENDER. Whenever the context requires,
reference herein made to the single number shall be understood to include the
plural and likewise the plural shall be understood to include the singular.
Words denoting sex shall be construed to include the masculine, feminine, and
neuter, when such construction is appropriate, and specific enumeration shall
not exclude the general, but shall be construed as cumulative. Definitions of
terms defined in the singular and plural shall be equally applicable to the
plural or singular, as the case may be.
ARTICLE II.
AMENDMENTS
The Borrower and the Lenders hereby amend the Agreement in
the following particulars:
2.01 AMENDMENT OF SECTION 1.2. Section 1.2 of the Agreement
is hereby amended as follows:
The following definitions are added and/or amended to read as
follows:
"PERMITTED INDEBTEDNESS" shall mean (a) the Obligations, (b)
Indebtedness arising from endorsing negotiable instruments
for deposit or collection in the ordinary course of business,
(c) current liabilities incurred in the ordinary course of
business, (d) other Indebtedness which does not exceed an
aggregate principal amount of $250,000 during any fiscal
year, (e) Indebtedness existing by virtue of the requirements
of GAAP or any changes in the requirements of GAAP, and (f)
Subordinated Debt.
"SUBORDINATED DEBT" shall mean (i) the Senior Subordinated
Promissory Note dated August __, 1999, from Middle Bay Oil
Company, Inc. payable to 3TEC Energy Corporation in the
principal
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amount of $10,700,000, (ii) the Senior Subordinated
Promissory Note dated August __, 1999, from Middle Bay Oil
Company, Inc., payable to ▇▇▇▇▇▇▇▇▇ Family Partners, LP in
the amount of $50,000, and (iii) the Senior Subordinated
Promissory Note dated August __, 1999, from Middle Bay Oil
Company, Inc., payable to Shoeinvest II, LP in the amount of
$100,000.
ARTICLE III.
CONDITIONS
The obligation of the Lenders to amend the Agreement as
provided herein is subject to the fulfillment of the following conditions
precedent:
3.01 RECEIPT OF DOCUMENTS. The Lenders shall have received,
reviewed, and approved the following documents and other items, appropriately
executed when necessary and in form and substance satisfactory to the Agent:
(a) multiple counterparts of this First Amendment as
requested by the Agent;
(b) Subordination Agreement dated August __, 1999, by and
among 3TEC Energy Corporation, Middle Bay Oil Company, Inc.
and Compass Bank and Bank of Oklahoma, National
Association.; and
(c) Subordination Agreement dated August __, 1999, by and
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Family Partners, LP, Middle Bay Oil Company,
nc. and Compass Bank and Bank of Oklahoma, National
ssociation.; and
(d) Subordination Agreement dated August __, 1999, by and
among Shoeinvest II, LP, Middle Bay Oil Company, Inc. and
Compass Bank and Bank of Oklahoma, National Association.; and
(e) such other agreements, documents, items, instruments,
opinions, certificates, waivers, consents, and evidence as
the Agent may reasonably request.
3.02 ACCURACY OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties contained in Article IV of the Agreement and
this First Amendment shall be true and correct.
3.03 MATTERS SATISFACTORY TO LENDERS. All matters incident
to the consummation of the transactions contemplated hereby shall be
satisfactory to the Lenders.
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ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
The Borrower hereby expressly re-makes, in favor of the Agent
and the Lenders, all of the representations and warranties set forth in Article
IV of the Agreement, and represents and warrants that all such representations
and warranties remain true and unbreached.
ARTICLE V.
RATIFICATION
Each of the parties hereto does hereby adopt, ratify, and
confirm the Agreement and the other Loan Documents, in all things in accordance
with the terms and provisions thereof, as amended by this First Amendment.
ARTICLE VI.
MISCELLANEOUS
6.01 SCOPE OF AMENDMENT. The scope of this First Amendment
is expressly limited to the matters addressed herein and this First Amendment
shall not operate as a waiver of any past, present, or future breach, Default,
or Event of Default under the Agreement, except to the extent, if any, that any
such breach, Default, or Event of Default is remedied by the effect of this
First Amendment.
6.02 AGREEMENT AS AMENDED. All references to the Agreement
in any document heretofore or hereafter executed in connection with the
transactions contemplated in the Agreement shall be deemed to refer to the
Agreement as amended by this First Amendment.
6.03 PARTIES IN INTEREST. All provisions of this First
Amendment shall be binding upon and shall inure to the benefit of the Borrower,
the Lender and their respective successors and assigns.
6.04 RIGHTS OF THIRD PARTIES. All provisions herein are
imposed solely and exclusively for the benefit of the Agent and the Lenders and
the Borrower, and no other Person shall have standing to require satisfaction
of such provisions in accordance with their terms and any or all of such
provisions may be freely waived in whole or in part by the Lender at any time
if in its sole discretion it deems it advisable to do so.
6.05 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER WRITTEN
LOAN DOCUMENTS CONSTITUTE THE ENTIRE AGREEMENT BETWEEN THE PARTIES HERETO WITH
RESPECT TO THE SUBJECT HEREOF AND SHALL SUPERSEDE ANY PRIOR AGREEMENT BETWEEN
THE PARTIES HERETO,
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WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT HEREOF. FURTHERMORE, IN
THIS REGARD, THIS AGREEMENT AND THE OTHER WRITTEN LOAN DOCUMENTS REPRESENT,
COLLECTIVELY, THE FINAL AGREEMENT AMONG THE PARTIES THERETO AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF SUCH PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG SUCH
PARTIES.
6.06 GOVERNING LAW. THIS AGREEMENT AND THE NOTE SHALL BE
DEEMED TO BE CONTRACTS MADE UNDER AND SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO PRINCIPLES
THEREOF RELATING TO CONFLICTS OF LAW; PROVIDED, HOWEVER, THAT CHAPTER 345 OF THE
TEXAS FINANCE CODE (WHICH REGULATES CERTAIN REVOLVING CREDIT LOAN ACCOUNTS AND
REVOLVING TRIPARTY ACCOUNTS) SHALL NOT APPLY.
6.07 JURISDICTION AND VENUE. ALL ACTIONS OR PROCEEDINGS WITH
RESPECT TO, ARISING DIRECTLY OR INDIRECTLY IN CONNECTION WITH, OUT OF, RELATED
TO, OR FROM THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE LITIGATED, AT THE
SOLE DISCRETION AND ELECTION OF THE LENDERS, IN COURTS HAVING SITUS IN HOUSTON,
▇▇▇▇▇▇ COUNTY, TEXAS. THE BORROWER HEREBY SUBMIT TO THE JURISDICTION OF ANY
LOCAL, STATE, OR FEDERAL COURT LOCATED IN HOUSTON, ▇▇▇▇▇▇ COUNTY, TEXAS, AND
HEREBY WAIVE ANY RIGHTS THEY MAY HAVE TO TRANSFER OR CHANGE THE JURISDICTION OR
VENUE OF ANY LITIGATION BROUGHT AGAINST THEM BY THE LENDERS IN ACCORDANCE WITH
THIS SECTION.
IN WITNESS WHEREOF, this First Amendment to Credit Agreement
is executed effective the date first hereinabove written.
BORROWER:
MIDDLE BAY OIL COMPANY, INC.
By:
-------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President
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ENEX RESOURCES CORPORATION
By:
-------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President
LENDER AND AGENT:
COMPASS BANK
By:
-------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Senior Vice President
LENDER:
BANK OF OKLAHOMA, NATIONAL
ASSOCIATION
By:
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Senior Vice President
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