EXECUTION COPY
AMENDMENT NO. 5 TO CREDIT AGREEMENT
AMENDMENT dated as of June 30, 2000 to the Amended and Restated Credit
Agreement dated as of June 8, 1999 (the "Credit Agreement") among HALLWOOD
ENERGY CORPORATION, HALLWOOD ENERGY PARTNERS, L.P. and HALLWOOD CONSOLIDATED
RESOURCES CORPORATION (collectively, the "Borrowers"), the BANKS party thereto
(the "Banks"), FIRST UNION NATIONAL BANK, as Collateral Agent and MORGAN
GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the "Agent").
W I T N E S S E T H :
WHEREAS, the parties hereto desire to amend the Credit Agreement as
set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Defined Terms; References. Unless otherwise specifically defined
herein, each term used herein which is defined in the Credit Agreement has the
meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall, after this Amendment becomes effective,
refer to the Credit Agreement as amended hereby.
SECTION 2. Resetting of the Availability Limit and the Debt Limit. (a) The
definition of "Availability Limit" set forth in Section 1.01 of the Credit
Agreement is amended by to read in its entirety as follows:
"Availability Limit" means, on any date, an amount equal to the lesser of
(i) the aggregate amount of the Commitments at such date and (ii) $70,000,000;
provided that on any date on which the Debt Limit is reset to a new amount in
accordance with Section 4.17(c)(ii), Section 4.17(c)(iii) or Section 3 of
Amendment No. 5 to this Agreement (and, in the case of any reset pursuant to
Section 4.17(c)(iii) or Section 3 of such Amendment No. 5 that constitutes an
increase in the Debt Limit, all the Banks have agreed to such new amount, in
their sole discretion), the amount set forth in this clause (ii) shall be deemed
to have been amended (effective on and as of the date such reset is effective)
to be such
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new amount, without any further action on the part of any Borrower or any Bank.
Except as set forth in the proviso to clause (ii) of the immediately preceding
sentence, the Availability Limit may be increased only by an amendment in
accordance with Section 8.05, which the Banks may agree to or not agree to in
their sole discretion.
(b) Effective on and as of the date hereof, the "Debt Limit", as
determined in accordance with subsection (b) of Section 4.17 of the Credit
Agreement, shall be $70,000,000.
SECTION 3. Additional Review of the Debt Limit and Availability Limit.
(a) (i) On or prior to August 1, 2000, the Borrowers shall provide to the Banks
such information as the Required Banks may reasonably request in order to
redetermine the Debt Limit.
(ii) Reasonably promptly after receipt of the information delivered
pursuant to clause (i), Banks having at least 70% of the aggregate amount of the
Commitments shall have the option to redetermine the Debt Limit and the Agent
shall notify the Borrowers of any such redetermination, upon which notice such
new Debt Limit (the "New Debt Limit") shall become immediately effective and
binding on all parties to the Credit Agreement and shall be the Debt Limit
thereunder, until further determinations thereof in accordance with Section
4.17(c) of the Credit Agreement. The redetermination of the Debt Limit pursuant
to this Section shall not affect the ability of the Borrowers to request an
additional such redetermination pursuant to Section 4.17(c)(iv) of the Credit
Agreement in accordance with, and subject to the terms of, such Section.
(iii) If upon the effectiveness of the New Debt Limit, the aggregate
unpaid principal amount of the Debt of the Borrowers exceeds the New Debt Limit,
then the Borrowers shall take one of the actions contemplated by clauses (i),
(ii) and (iii) of Section 2.10 of the Credit Agreement within three (3) Domestic
Business Date from the date the Borrowers receive notice from the Agent of the
New Debt Limit.
(iv) Failure by the Borrowers to comply with the provisions of clause
(iii) above shall constitute an "Event of Default" under the Credit Agreement
and shall entitle the Agent, the Collateral Agent and the Banks to exercise all
rights and remedies available under the Financing Documents upon the occurrence
of an Event of Default.
SECTION 4. Additional Condition to Borrowing. Section 6.03 of the
Credit Agreement is amended by the addition of the following new subsection (f):
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(f) in the case of any Borrowing prior to the redetermination
of the Debt Limit in accordance with Section 3 of Amendment No. 5 to
the Agreement which results in the aggregate outstanding principal
amount of the Loans exceeding $66,000,000, the fact that any Loan
proceeds in excess of $66,000,000 shall be applied on the date of such
Borrowing to the payment by the Borrower of the purchase price of
additional Proved Reserves in the United States pursuant to a
transaction which shall have been approved in writing by all Banks.
SECTION 5. Representations of Borrowers. The Borrowers represent and
warrant that (i) the representations and warranties of the Borrowers set forth
in Article 3 of the Credit Agreement are true on and as of the date hereof and
(ii) no Default has occurred and is continuing.
SECTION 6. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
SECTION 8. Effectiveness. This Amendment shall become effective as of
the date hereof on the date on which the Agent shall have received from the
Borrowers and the Required Banks a counterpart hereof signed by such party or
facsimile or other written confirmation (in form satisfactory to the Agent) that
such party has signed a counterpart hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first above written.
HALLWOOD ENERGY CORPORATION
By:
Name:
Title:
HALLWOOD CONSOLIDATED
RESOURCES CORPORATION
By:
Name:
Title:
HALLWOOD ENERGY PARTNERS, L.P.
By: HEC Acquisition Corp., its
General Partner
By___________________________
Name:
Title:
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MORGAN GUARANTY TRUST
COMPANY OF NEW YORK
By:
Name:
Title:
FIRST UNION NATIONAL BANK
By:
Name:
Title:
WELLS FARGO BANK TEXAS, N.A.
By:
Name:
Title:
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Acknowledged by:
HALLWOOD LA PLATA, LLC
LA PLATA ASSOCIATES, LLC
By: HALLWOOD PETROLEUM, INC.
By:______________________________________
Name:
Title:
The Manager of Hallwood La Plata LLC and La
Plata Associates LLC
CONCISE OIL AND GAS PARTNERSHIP
EM NOMINEE PARTNERSHIP COMPANY
MAY ENERGY PARTNERS OPERATING
PARTNERSHIP LTD.
By: HEC ACQUISITION CORP.
By:______________________________________
Name:
Title:
The General Partner of Concise Oil and Gas
Partnership, EM Nominee Partnership Company,
May Energy Partners Operating Partnership
LTD.
HALLWOOD CONSOLIDATED PARTNERS,
L.P.
By: HALLWOOD CONSOLIDATED
RESOURCES CORPORATION
By:______________________________________
Name:
Title:
The General Partner of Hallwood Consolidated
Partners, L.P.
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