Exhibit 10(t)
February 28, 2002
AMENDED
LETTER LOAN AGREEMENT
The Beard Company
5600 N. May Avenue, Suite 320
Oklahoma City, Oklahoma 73112
Gentlemen:
This Amended Letter Loan Agreement supersedes the previous Amended Letter Loan
Agreement between the parties hereto dated January 15, 2002.
This Amended Letter Loan Agreement sets forth the terms and conditions under
which we have agreed to extend a revolving loan to you in the principal amount
of $2,625,000.00 (the "Loan").
1. LENDER: The William M. Beard and Lu Beard 1988 Charitable Unitrust
(the "Unitrust").
2. BORROWER: The Beard Company.
3. AMOUNT: Such amounts as the Borrower may request from time to time
up to $2,625,000.00. The Loan shall be evidenced by a
promissory note in the amount of $2,625,000.00 dated as of
today (the "Note"). The Borrower shall be permitted to
obtain advances, make prepayments, and obtain additional
advances, up to the amount of the Note.
4. INTEREST RATE: A fixed rate of 10.00%.
5. REPAYMENT: The outstanding principal balance (the "Indebtedness")
plus unpaid accrued interest shall be due and payable on
September 30, 2003.
6. COLLATERAL: A. Until the Indebtedness has been paid in full, the
Borrower agrees that it will not create, grant, assume or
suffer to exist any lien, mortgage or encumbrance (a
"Lien") on its working and overriding royalty interests in
the McElmo Dome Unit in Montezuma and Dolores Counties of
Colorado ("Interests"). The Borrower will not sell,
transfer, convey or otherwise dispose of any of the
Interests, whether pursuant to a single transaction or a
series of transactions.
B. At any time while there is Indebtedness outstanding
under the Note, the Trustees of the Unitrust may request,
and the Borrower agrees to grant to the Unitrust, a Lien
on its Interests, and in such event the Borrower will
immediately furnish such Assignments, Transfer Orders,
Security Agreements or other documents as the Trustees may
require in order to secure the Indebtedness.
7. COVENANT: Until the Indebtedness has been paid in full, the Borrower
will not sell, transfer, convey or otherwise dispose of,
all or a substantial portion of its assets now owned or
hereafter acquired, whether pursuant to a single
transaction or a series of transactions, and the Borrower
will not merge or consolidate with any person or entity or
permit any such merger or consolidation with the Borrower.
This paragraph specifically excludes asset sales incurred
in the normal course of business.
8. EVENTS OF DEFAULT: If any of the following conditions or events ("Events of
Default") shall occur and be continuing:
A. Failure of the Borrower to pay when due any amounts,
including principal or interest on the Note (whether at
the stated maturity, upon acceleration or otherwise).
B. Any Event of Default as specified in the Note
C. Any default or breach in the performance of any covenant,
obligation, representation, warranty or provision
contained in this Letter Loan Agreement or in the Note or
in any other note or obligation of Borrower to the
Unitrust.
D. The Borrower shall: (i) apply for or consent to the
appointment of a custodian, receiver, trustee or
liquidator of the Borrower or any of its properties, (ii)
admit in writing the inability to pay, or generally fail
to pay, its debts when they come due, (iii) make a general
assignment for the benefit of creditors, (iv) commence any
proceeding relating to the bankruptcy, reorganization,
liquidation, receivership, conservatorship, insolvency,
readjustment of debt, dissolution or liquidation of the
Borrower, or if corporate action should be taken by the
Borrower for the purpose of effecting any of the
foregoing, (v) suffer any such appointment or commencement
of a proceeding as described in clause (i) or (iv) of this
paragraph, which appointment or proceeding is not
terminated or discharged within 60 days, or (vi) become
insolvent.
THEN upon the occurrence of any Event of Default described in the foregoing
paragraphs the unpaid principal amount of and accrued interest on the Loan
shall automatically become immediately due and payable, without
presentment, demand, protest or other requirements of any kind, all of
which are hereby expressly waived by Borrower.
If the foregoing terms and conditions are acceptable to you, please acknowledge
your agreement by signing below and returning one copy of this Letter Loan
Agreement to us.
Sincerely,
LENDER:
THE WILLIAM M. BEARD AND LU BEARD
1988 CHARITABLE UNITRUST
WILLIAM M. BEARD LU BEARD
William M. Beard, Trustee Lu Beard, Trustee
Accepted effective this 28th day of February, 2002.
BORROWER:
THE BEARD COMPANY
HERB MEE, JR.
Herb Mee, Jr., President