EXHIBIT 10
FIRST AMENDMENT
TO CREDIT AGREEMENT
15
FIRST AMENDMENT TO CREDIT AGREEMENT AND WAIVER
This First Amendment to Credit Agreement and Waiver (this "First
Amendment") is entered into as of the 1st day of April, 1997, by and among
Denbury Management, Inc. ("Borrower"), Denbury Resources, Inc., ("Resources"),
Denbury Holdings, Ltd., ("Holdings", together with Resources, the "Guarantors"),
NationsBank of Texas, N.A., as Agent ("Agent"), and NationsBank of Texas, N.A.,
Bankers Trust Company and Internationale Nederlanden (U.S.) Capital Corporation,
as Banks (the "Banks").
W I T N E S E T H:
WHEREAS, Borrower, Guarantors, Agent and the Banks are parties to that
certain Credit Agreement dated as of May 31, 1996 (as amended, the "Credit
Agreement") (unless otherwise defined herein, all terms used herein with their
initial letter capitalized shall have the meaning given such terms in the Credit
Agreement); and
WHEREAS, pursuant to the Credit Agreement the Banks have made certain Loans
to Borrower, and Agent has issued certain Letters of Credit on behalf of
Borrower; and
WHEREAS, Borrower has requested that (i) certain definitions in the Credit
Agreement be amended in certain respects, (ii) the Banks extend the Revolver
Conversion Date to May 31, 1999, (iii) the Banks extend the Termination Date to
May 31, 2002, (iv) the Commitment Fee Percentage be reduced in certain respects
and (v) the requirement of additional Title Opinions be waived until further
notice from Agent; and
WHEREAS, subject to the terms and conditions herein contained, the Banks
have agreed to Borrower's requests.
NOW THEREFORE, for and in consideration of the mutual covenants and
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and confessed,
Borrower, Agent and each Bank hereby agree as follows:
Section 1.Amendments. Subject to the satisfaction of each condition
precedent set forth in Section 3 hereof and in reliance on the representations,
warranties, covenants and agreements contained in this First Amendment, the
Credit Agreement shall be amended effective April 1, 1997 (the "Effective Date")
in the manner provided in this Section 1.
1.1.Amendment to Definitions. The definitions of "Commitment Fee
Percentage", "Loan Papers", "Revolver Conversion Date" and "Termination Date"
contained in Section 1.1 of the Credit Agreement shall be amended to read in
full as follows:
"Commitment Fee Percentage" means, on any date, an amount determined by
reference to the ratio of Outstanding Credit to the Borrowing Base on such
date in accordance with the table below:
Ratio of Outstanding Credit
to Borrowing Base Commitment Fee Percentage
- --------------------------------------- ---------------------------------------
Less than/equal to .50 to 1 .30%
Greater than .50 to 1 and
less than/equal to .75 to 1 .35%
Greater than .75 to 1 .375%
"Loan Papers" means this Agreement, the First Amendment, the Notes, the
Facility Guarantees, the Parent Pledge Agreement, the Holdings Pledge
Agreement, the Borrower Pledge Agreement, the Assignment and Amendment to
Mortgages, all Mortgages now or at any time hereafter delivered pursuant to
Section 5.1, and all other certificates, documents or instruments delivered
in connection with this Agreement, as the foregoing may be amended from
time to time.
"Revolver Conversion Date" means May 31, 1999.
"Termination Date" means May 31, 2002.
Section 2.Borrowing Base. Effective as of April 1, 1997 and continuing
until the next Scheduled or Special Redetermination, the Borrowing Base under
the Credit Agreement shall be $60,000,000.
Section 3.Limited Waiver.
As of the date hereof, Borrower has delivered to Agent Title Opinions
covering approximately sixty-one percent (61%) of the Recognized Value of the
Proved Mineral Interests. Agent and Banks hereby agree to temporarily waive the
requirement that Title Opinions be delivered with respect to the remaining
portion of the Required Reserve Value of the Proved Mineral Interests. Until
further notice from Agent, Borrower shall only be required to deliver Title
Opinions to Agent and the Banks covering Proved Mineral Interests up to the
Required Reserve Value as Agent shall reasonably request.
The waiver set forth in this Section 3 is expressly limited as follows: (a)
such temporary waiver is limited solely to requirements to deliver Title
Opinions in the Credit Agreement, (b) such temporary waiver shall not be
applicable to any provision of any Loan Paper other than requirements to deliver
Title Opinions in the Credit Agreement, and (c) such temporary waiver is a
limited, one-time waiver, and nothing contained herein shall obligate Banks to
grant any additional or future waiver of requirements to deliver Title Opinions
in the Credit Agreement or any other provision of any Loan Paper.
Section 4. Conditions Precedent to Effectiveness of Amendments. The
amendments to the Credit Agreement contained in Section 1 of this First
Amendment shall be effective only upon the satisfaction of each of the
conditions set forth in this Section 4. If each condition set forth in this
Section 4 has not been satisfied by the Effective Date, this First Amendment and
all obligations of the Banks and Agent contained herein shall, at the option of
Required Banks, terminate.
4.1 Corporate Existence and Authority. Borrower shall have delivered to
Agent such resolutions, certificates and other documents as Agent shall request
relative to the authorization, execution and delivery by Borrower and Guarantors
of this First Amendment.
4.2 Certificate Regarding Representations and Warranties. Borrower shall
have delivered to Agent a certificate of its vice president of finance, chief
financial officer or chief accounting officer certifying that each
representation and warranty contained in (a) the Credit Agreement, (b) this
First Amendment, and (c) each of the other Loan Papers is true and correct and
will be true and correct after giving effect to the amendments contained in
Section 1 hereof.
Section 5. Representations and Warranties of Borrower. To induce the Banks
and Agent to enter into this First Amendment, Borrower and Guarantors hereby
represent and warrant to Agent as follows:
(a)Each representation and warranty of Borrower and Guarantors contained in
the Credit Agreement and the other Loan Papers is true and correct on the date
hereof and will be true and correct after giving effect to the amendments set
forth in Section 1 hereof.
(b)The execution, delivery and performance by Borrower and Guarantors of
this First Amendment are within the Borrower's and each Guarantor's corporate
powers, have been duly authorized by necessary action, require no action by or
in respect of, or filing with, any governmental body, agency or official and do
not violate or constitute a default under any provision of applicable law or any
Material Agreement binding upon Borrower, the Subsidiaries of Borrower or the
Guarantors or result in the creation or imposition of any Lien upon any of the
assets of Borrower or the Subsidiaries of Borrower or the Guarantors except
Permitted Encumbrances.
(c)This First Amendment constitutes the valid and binding obligation of
Borrower and the Guarantors enforceable in accordance with its terms, except as
(i) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditor's rights generally, and (ii) the availability of
equitable remedies may be limited by equitable principles of general
application.
(d)Borrower and Guarantors have no defenses to payment, counterclaims or
rights of set-off with respect to the Obligations existing on the date hereof.
(e)With the exception of the Amerada-Hess Acquisition, Borrower has not
acquired any material Mineral Interests since May 31, 1996.
(f)Agent, for the benefit of the Banks, has a first and prior Lien (subject
only to Permitted Encumbrances) covering and encumbering Proved Mineral
Interests owned by Borrower with a Recognized Value of not less than eighty five
percent (85%) of the Recognized Value of all Proved Mineral Interests owned by
Borrower.
Section 6. Miscellaneous.
6.1 Reaffirmation of Loan Papers; Extension of Liens. Any and all of the
terms and provisions of the Credit Agreement and the Loan Papers shall, except
as amended and modified hereby, remain in full force and effect. Borrower and
Guarantors hereby extend the Liens securing the Obligations until the
Obligations have been paid in full, and agree that the amendments and
modifications herein contained shall in no manner affect or impair the
Obligations or the Liens securing payment and performance thereof.
6.2 Parties in Interest. All of the terms and provisions of this First
Amendment shall bind and inure to the benefit of the parties hereto and their
respective successors and assigns.
6.3 Legal Expenses. Borrower hereby agrees to pay on demand all reasonable
fees and expenses of counsel to Agent incurred by Agent, in connection with the
preparation, negotiation and execution of this First Amendment and all related
documents.
6.4 Counterparts. This First Amendment may be executed in counterparts, and
all parties need not execute the same counterpart; however, no party shall be
bound by this First Amendment until all parties have executed a counterpart.
Facsimiles shall be effective as originals.
6.5 Complete Agreement. THIS FIRST AMENDMENT, THE CREDIT AGREEMENT AND THE
OTHER LOAN PAPERS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
6.6 Headings. The headings, captions and arrangements used in this First
Amendment are, unless specified otherwise, for convenience only and shall not be
deemed to limit, amplify or modify the terms of this First Amendment, nor affect
the meaning thereof.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
be duly executed by their respective authorized officers on the date and year
first above written.
BORROWER:
DENBURY MANAGEMENT, INC.,
a Texas corporation
By:________________________________________
Name:______________________________________
Title:_____________________________________
By:________________________________________
Name:______________________________________
Title:_____________________________________
GUARANTORS:
DENBURY HOLDINGS, LTD.,
a corporation incorporated under the
Business Corporations Act (Alberta)
By:________________________________________
Name:______________________________________
Title:_____________________________________
By:________________________________________
Name:______________________________________
Title:_____________________________________
DENBURY RESOURCES, INC.,
a corporation incorporated under the
Canada Business Corporations Act
By:________________________________________
Name:______________________________________
Title:_____________________________________
By:________________________________________
Name:______________________________________
Title:_____________________________________
AGENT:
NATIONSBANK OF TEXAS, N.A.
By:________________________________________
J. Scott Fowler
Vice President
BANKS:
NATIONSBANK OF TEXAS, N.A.
By:________________________________________
J. Scott Fowler
Vice President
BANKERS TRUST COMPANY
By:________________________________________
Name:______________________________________
Title:_____________________________________
INTERNATIONALE NEDERLANDEN (U.S.)
CAPITAL CORPORATION
By:________________________________________
Name:______________________________________
Title:_____________________________________
GW02/219412.03