Exhibit 10.21
SEVENTH AMENDMENT
TO
FIRST AMENDED AND RESTATED LOAN AGREEMENT
DATED SEPTEMBER 23, 1996
BY AND BETWEEN SABA PETROLEUM COMPANY, ET AL
AND BANK ONE, TEXAS, N.A.
This Seventh Amendment to the First Amended and Restated Loan Agreement
dated September 23, 1996 (this "Seventh Amendment") by and among SABA PETROLEUM
COMPANY, a Delaware corporation, successor by merger to Saba Petroleum Company,
a Colorado corporation (the "Borrower") each of the undersigned Guarantors, and
BANK ONE, TEXAS, N.A., a national banking association (the "Bank"), is entered
into on this 30th day of March 1997.
W I T N E S S E T H:
Borrower and Bank have entered into a First Amended and Restated Loan
Agreement dated September 23, 1996, as amended by the First Amendment thereto
dated November 5, 1996, the Second Amendment thereto dated August 28, 1997, the
Third Amendment thereto dated September 5, 1997, and the Fourth Amendment
thereto dated September 9, 1997, the Fifth Amendment thereto dated November 11,
1997, and the Sixth Amendment thereto dated December 31, 1997 (collectively, the
"Loan Agreement").
Borrower has requested that, among other things, Bank waive certain
Events of Default that otherwise would have arisen under the Loan Agreement as
the result of certain principal reductions owed on the Loan not having been paid
when due, and that Bank agree to further defer the payment date for such
principal reductions as well as other principal reductions due on the Loans, and
Bank has agreed to such waivers and amendments to the extent expressly set forth
herein.
NOW, THEREFORE, in consideration of the promises herein contained, and
for other good and valuable consideration, the receipt and sufficiency of which
are acknowledged by the Borrower, the Guarantors and the Bank, and each
intending to be legally bound hereby, the parties agree as follows:
I. Specific Amendments to Loan Agreement.
Article I is hereby amended by adding the following defined term
thereto:
"Sixth Amendment" means that certain Amendment to this
Agreement executed by Borrower and Bank on December 31, 1997.
"Seventh Amendment" means the Seventh Amendment to this
Agreement executed by Borrower and Bank on March 30, 1997.
Section 2.03 is hereby amended by replacing the first grammatical
paragraph thereof that was added by the Third Amendment with the following text:
As of August 1, 1997, Borrowing Base I is redetermined to be Nineteen
Million One Hundred Thousand and No/100 Dollars ($19,100,000.00), which
shall thereafter decline in the amount of $400,000.00, monthly (except
for the months expressly excluded, below), beginning on September 1,
1997, and continuing on the first day of each successive month
thereafter; provided, however, that such $400,000.00 monthly reduction
in Borrowing Base I shall not occur during the months of February,
March and April 1998, but shall then resume effective on May 1, 1998,
and continue monthly thereafter until the effective date of the next
redetermination of Borrowing Base I as set forth in this Section. As of
the effective date of the Third Amendment, Borrowing Base II is
redetermined to be $3,400,000.00, which shall thereafter decline by
$142,000.00 monthly (except for the months expressly excluded, below)
beginning on November 1, 1997, and continuing on the first day of each
successive month thereafter; provided, however, that such $142,000.00
monthly reduction in Borrowing Base II shall not occur during the
months of February, March and April 1998.
Section 5.37, as added to the Loan Agreement by the Sixth Amendment, is
hereby amended by replacing the sum A$3,000,000.00" that appears in the third
line thereof with the sum A$2,000,000.00," and by replacing the date AApril 1,
1998" that appears in the fourth line thereof with the date AApril 15, 1998.@
II. Certain Waivers. The Bank hereby waives the Events of Default and/or
Unmatured Events of Default that occurred when Borrower failed to cure the Loan
Excess that existed, prior to the execution of this Seventh Amendment, as the
result of: (a) the monthly reductions in Borrowing Base I that occurred on
February 1 and March 1, 1998, and (b) the monthly reductions in Borrowing Base
II that occurred on February 1 and March 1, 1998. BORROWER AND EACH GUARANTOR
HEREBY ACKNOWLEDGE AND AGREE THAT, EXCEPT FOR WAIVERS AND AMENDMENTS EXPRESSLY
SET FORTH HEREIN, BANK HAS NOT GIVEN OR MADE, NOR HAS BANK AGREED TO GIVE OR
MAKE, ANY OTHER WAIVERS OF DEFAULTS OR EVENTS OF DEFAULT THAT HAVE EXISTED OR
THAT MIGHT HEREAFTER EXIST UNDER ANY OF THE LOAN DOCUMENTS, OR ANY AMENDMENTS TO
ANY OF THE PROVISIONS OF THE LOAN DOCUMENTS, AND NO INTENT TO GRANT FUTURE
WAIVERS OR AMENDMENTS HAS BEEN OR MAY BE INFERRED AS THE RESULT OF ANY COURSE OF
DEALING BETWEEN BANK, BORROWER, AND GUARANTORS WITH RESPECT TO ANY PRIOR
WAIVERS, CONSENTS, OR AMENDMENTS WITH RESPECT TO ANY OF THE LOAN DOCUMENTS.
III. Ratification of Guaranties. Each Guarantor hereby ratifies and confirms its
liability under the Guaranty heretofore executed by it, and, except as stated to
the contrary in this paragraph, confirms and agrees that such Guaranty continues
in full force and effect with respect to all of the Indebtedness covered by the
Loan Agreement, as the same may be restated, amended, modified, renewed, or
rearranged from time to time, including, but not limited to, the Indebtedness
evidenced by the Note, the Term Note and the Mezzanine Note; provided, however,
that the Guaranty of Sabacol relates only to the Indebtedness evidenced by the
Term Note and the Mezzanine Note, and the Guaranty of Ilyas Chaudhary relates
only to the Indebtedness evidenced by the Term Note and the Mezzanine Note. This
ratification is given for the purpose of inducing the Bank to enter into this
amendment, and each Guarantor is aware that, but for such ratification and
agreement contained herein, the Bank would not grant the waivers and amendments
set forth herein.
IV. Reaffirmation of Representations and Warranties. To induce the Bank to enter
into this Seventh Amendment, the Borrower and each Guarantor hereby reaffirms,
as of the date hereof, its representations and warranties contained in Article
IV of the Loan Agreement and in all other documents executed pursuant thereto,
and additionally represents and warrants as follows:
A. The execution and delivery of this Seventh Amendment and
the performance by the Borrower and each Guarantor of its obligations
under this Seventh Amendment are within the Borrower's and each
Guarantor's power, have been duly authorized by all necessary corporate
action, have received all necessary governmental approval (if ANY shall
be required), and do not and will not contravene or conflict with ANY
provision of law or of the charter or by-laws of the Borrower or ANY
Guarantor or of ANY agreement binding upon the Borrower or ANY
Guarantor.
B. The Loan Agreement as amended by this Seventh Amendment
represents the legal, valid and binding obligations of the Borrower and
each Guarantor, enforceable against each in accordance with their
respective terms subject as to enforcement only to bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally.
C. No Event of Default or Unmatured Event of Default has
occurred and is continuing as of the date hereof.
V. Defined Terms. Except as amended hereby, terms used herein that are defined
in the Loan Agreement shall have the same meanings herein.
VI. Reaffirmation of Loan Agreement. This Seventh Amendment shall be deemed to
be an amendment to the Loan Agreement, and the Loan Agreement, as further
amended hereby, is hereby ratified, approved and confirmed in each and every
respect. All references to the Loan Agreement herein and in ANY other document,
instrument, agreement or writing shall hereafter be deemed to refer to the Loan
Agreement as amended hereby.
VII. Entire Agreement. The Loan Agreement, as hereby further amended, embodies
the entire agreement between the Borrower, the Guarantors and the Bank and
supersedes all prior proposals, agreements and understandings relating to the
subject matter hereof. The Borrower and each Guarantor certifies that it is
relying on no representation, warranty, covenant or agreement except for those
set forth in the Loan Agreement, as hereby amended, and the other documents
previously executed or executed of even date herewith.
VIII. Governing Law. THIS SEVENTH AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA. This Seventh Amendment has been entered into in Harris
County, Texas, and it shall be performable for all purposes in Harris County,
Texas. Courts within the State of Texas shall have jurisdiction over ANY and all
disputes between the Borrower and the Bank, whether in law or equity, including,
but not limited to, ANY and all disputes arising out of or relating to this
Seventh Amendment or ANY other Loan Document; and venue in ANY such dispute
whether in federal or state court shall be laid in Harris County, Texas.
IX. Severability. Whenever possible each provision of this Seventh Amendment
shall be interpreted in such manner as to be effective and valid under
applicable law, but if ANY provision of this Seventh Amendment shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Seventh Amendment.
X. Execution in Counterparts. This Seventh Amendment may be executed in ANY
number of counterparts and by the different parties on separate counterparts,
and each such counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument, and ANY
signed counterpart shall be deemed delivered by the party executing such
counterpart if sent to ANY other party hereto by electronic facsimile
transmission.
XI. Section Captions. Section captions used in this Seventh Amendment are
for convenience of reference only, and shall not affect the construction of
this Seventh Amendment.
XII. Successors and Assigns. This Seventh Amendment shall be binding upon the
Borrower, each Guarantor and the Bank and their respective successors and
assigns, and shall inure to the benefit of the Borrower, each Guarantor and the
Bank, and the respective successors and assigns of the Bank.
XIII. Non-Application of Chapter 15 of Texas Credit Codes. The provisions of
Chapter 15 of the Texas Credit Code (Vernon's Texas Civil Statutes, Article
5069-15) are specifically declared by the parties hereto not to be applicable to
the Loan Agreement as hereby further amended or ANY of the other Loan Documents
or to the transactions contemplated hereby.
XIV. NOTICE OF FINAL AGREEMENT. THIS SEVENTH AMENDMENT, TOGETHER WITH THE LOAN
AGREEMENT AND THE OTHER LOAN DOCUMENTS (COLLECTIVELY, THE AWRITTEN AGREEMENT@),
REPRESENT THE FINAL AGREEMENT AMONG BANK, BORROWER, AND GUARANTORS, AND 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.
IN WITNESS WHEREOF, the parties hereto have caused this Seventh
Amendment to be duly executed as of the day and year first above written.
BORROWER
SABA PETROLEUM COMPANY
By:___________________________
Walton C. Vance
Vice President and
Chief Financial Officer
BANK
BANK ONE, TEXAS, N.A.
By:___________________________
Name:_________________________
Title:_________________________
GUARANTORS:
SABA ENERGY OF TEXAS, INCORPORATED
By:________________________________
Walton C. Vance
Secretary
SABA PETROLEUM, INC.
By:________________________________
Walton C. Vance
Secretary
SABA PETROLEUM OF MICHIGAN, INC.
By:________________________________
Walton C. Vance
Secretary
MV VENTURES, G. P.
By: Saba Energy of Texas, Incorporated,
Managing Partner
By:___________________________
Walton C. Vance
Secretary
SABACOL, INC.
By:
Walton C. Vance
Secretary
ILYAS CHAUDHARY