FIRST AMENDMENT TO CREDIT AGREEMENT
-----------------------------------
This First Amendment to Credit Agreement (this "AMENDMENT") is made
effective as of the 10th day of July, 2004, by and among ATLAS AMERICA, INC., a
Delaware corporation (the "BORROWER"); AIC, INC., a Delaware corporation
("AIC"); ATLAS ENERGY CORPORATION, an Ohio corporation ("AEC"); ATLAS AMERICA,
INC., a Pennsylvania corporation ("ATLAS PA"); ATLAS ENERGY GROUP, INC., an Ohio
corporation ("ATLAS ENERGY"); ATLAS ENERGY HOLDINGS, INC., a Delaware
corporation ("ATLAS HOLDINGS"); ATLAS NOBLE CORP., a Delaware corporation
("ATLAS NOBLE"); ATLAS RESOURCES, INC., a Pennsylvania corporation ("ATLAS
RESOURCES"); REI-NY, INC., a Delaware corporation ("REI"), RESOURCE AMERICA,
INC., a Delaware corporation ("PARENT"); RESOURCE ENERGY, INC., a Delaware
corporation ("RESOURCE ENERGY"); and VIKING RESOURCES CORPORATION, a
Pennsylvania corporation ("VIKING"); (AIC, AEC, Atlas Energy, Atlas Holdings,
Atlas Noble, Atlas PA, Atlas Resources, Parent, REI, Resource Energy, and Viking
collectively, the "GUARANTORS," the Borrower and the Guarantors herein
collectively, the "OBLIGORS"); each of the lenders that is a signatory hereto
(individually, together with its successors and assigns, a "LENDER" and
collectively, the "LENDERS"); WACHOVIA BANK, NATIONAL ASSOCIATION, as
administrative agent for the Lenders (in such capacity, together with its
successors in such capacity, the "ADMINISTRATIVE AGENT"), and WACHOVIA BANK,
NATIONAL ASSOCIATION, as issuing bank (in such capacity, together with its
successors in such capacity, the "ISSUING BANK").
R E C I T A L S:
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A. The parties hereto are parties to the Credit Agreement dated March
12, 2004, to which the Lenders agreed to loan up to $75,000,000 to Borrower (the
"ORIGINAL AGREEMENT").
B. Borrower has requested that Administrative Agent, Issuing Bank and
Lenders amend the Original Agreement as provided herein, subject to the terms
and conditions hereof.
NOW, THEREFORE, in consideration of the foregoing, and intending to be
legally bound, the parties agree as follows:
SECTION 1. TERMS DEFINED IN AGREEMENT. As used in this Amendment,
except as may otherwise be provided herein, all capitalized terms which are
defined in the Original Agreement shall have the same meaning herein as therein,
all of such terms and their definitions being incorporated herein by reference.
The Original Agreement, as amended by this Amendment, is hereinafter called the
"AGREEMENT."
SECTION 2. AMENDMENT TO AGREEMENT. Subject to the conditions precedent
set forth in SECTION 3 hereof, the Original Agreement is hereby amended as
follows:
(a) SECTION 9.04 INVESTMENTS, LOANS AND ADVANCES. SUBSECTION (G)
of the Agreement is hereby amended and restated as follows:
"(g) advances to fund (i) Borrower and its Wholly Owned
Subsidiaries' capital contributions under the Partnerships and APL as
provided under SECTION 7.07(III) and (ii) up to $10,000,000 of
preferred membership units in Atlas Pipeline Operating Partnership,
L.P. as provided under the Commitment Letter dated as of June 10, 2004,
between Borrower and APL."
SECTION 3. CONDITIONS OF EFFECTIVENESS. The obligations of
Administrative Agent and Lenders to amend the Original Agreement as provided in
this Amendment is subject to the fulfillment of the following conditions
precedent:
(a) Borrower shall deliver to Administrative Agent and Lenders
multiple counterparts of this Amendment, duly executed by the Obligors.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF OBLIGORS. Each of the
Obligors represents and warrants to Administrative Agent and Lenders, with full
knowledge that Administrative Agent and Lenders are relying on the following
representations and warranties in executing this Amendment, as follows:
(a) Each Obligor has the organizational power and authority to
execute, deliver and perform this Amendment and such other Loan
Documents executed in connection herewith, and all organizational
action on the part of such Person requisite for the due execution,
delivery and performance of this Amendment and such other Loan
Documents executed in connection herewith has been duly and effectively
taken.
(b) The Original Agreement, as amended by this Amendment, the Loan
Documents and each and every other document executed and delivered in
connection with this Amendment to which any Obligor is a party
constitute the legal, valid and binding obligations of each Obligor to
the extent it is a party thereto, enforceable against such Person in
accordance with their respective terms.
(c) This Amendment does not and will not violate any provisions of
any of the Organization Documents of any Obligor, or any contract,
agreement, instrument or requirement of any Governmental Authority to
which Borrower is subject. Obligors' execution of this Amendment will
not result in the creation or imposition of any lien upon any
properties of any Obligor, other than those permitted by the Original
Agreement and this Amendment.
(d) The execution, delivery and performance of this Amendment by
Obligors does not require the consent or approval of any other Person,
including, without limitation, any regulatory authority or governmental
body of the United States of America or any state thereof or any
political subdivision of the United States of America or any state
thereof.
(e) No Default or Event of Default exists, and all of the
representations and warranties contained in the Original Agreement and
all instruments and documents executed pursuant thereto or contemplated
thereby are true and correct in all material respects on and as of this
date, other than those which have been disclosed to Administrative
Agent and Lenders in writing.
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(f) Nothing in this SECTION 4 of this Amendment is intended to
amend any of the representations or warranties contained in the
Original Agreement or of the Loan Documents to which any Obligor is a
party.
(g) Attached hereto as EXHIBIT A is a true and correct copy of the
Commitment Letter dated as of June 10, 2004, between Borrower and APL
regarding Borrower's commitment to purchase up to $10,000,000 of
preferred units in Atlas Pipeline Operating Partnership, L.P.
SECTION 5. REFERENCE TO AND EFFECT ON THE AGREEMENT.
(a) Upon the effectiveness of SECTIONS 1 and 2 hereof, on and after
the date hereof, each reference in the Original Agreement to "this
Agreement," "hereunder," "hereof," "herein," or words of like import
shall mean and be a reference to the Original Agreement as amended
hereby.
(b) Except as specifically amended by this Amendment, the Agreement
shall remain in full force and effect and is hereby ratified and
confirmed.
SECTION 8. COST, EXPENSES AND TAXES. Borrower agrees to pay on demand
all reasonable costs and expenses of Administrative Agent in connection with the
preparation, reproduction, execution and delivery of this Amendment and the
other instruments and documents to be delivered hereunder, including reasonable
attorneys' fees and out-of-pocket expenses of Administrative Agent. In addition,
Borrower shall pay any and all recording and filing fees payable or determined
to be payable in connection with the execution and delivery, filing or recording
of this Amendment and the other instruments and documents to be delivered
hereunder, and agrees to save Administrative Agent harmless from and against any
and all liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes or fees.
SECTION 9. EXTENT OF AMENDMENTS. Except as otherwise expressly provided
herein, the Original Agreement and the other Loan Documents are not amended,
modified or affected by this Amendment. Obligors ratify and confirm that (i)
except as expressly amended hereby, all of the terms, conditions, covenants,
representations, warranties and all other provisions of the Original Agreement
remain in full force and effect, (ii) each of the other Loan Documents are and
remain in full force and effect in accordance with their respective terms, and
(iii) the Collateral is unimpaired by this Amendment.
SECTION 10. DISCLOSURE OF CLAIMS. As additional consideration to the
execution, delivery, and performance of this Amendment by the parties hereto and
to induce Lenders to enter into this Amendment, each Obligor represents and
warrants that no Obligor knows of no defenses, counterclaims or rights of setoff
to the payment of any Indebtedness.
SECTION 11. AFFIRMATION OF GUARANTY, SECURITY INTEREST.
(a) Each of the undersigned Guarantors hereby consents to and
accepts the terms and conditions of this Amendment and the transactions
contemplated thereby, agrees to be bound by the terms and conditions
thereof, and ratifies and confirms that each Guaranty and each of the
other Loan Documents to which it is a party is, and shall remain, in
full force and effect after giving effect to this Amendment.
3
(b) Obligors hereby confirm and agree that any and all liens,
security interest and other security or Collateral now or hereafter
held by Administrative Agent for the benefit of Lenders as security for
payment and performance of the Obligations hereby under such Security
Instruments to which such Obligor is a party are renewed and carried
forth to secure payment and performance of all of the Obligations. The
Security Instrument are and remain legal, valid and binding obligations
of the parties thereto, enforceable in accordance with their respective
terms.
SECTION 12. EXECUTION AND COUNTERPARTS. This Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute but one and the
same instrument. Delivery of an executed counterpart of this Amendment by
facsimile and other Loan Documents shall be equally as effective as delivery of
a manually executed counterpart of this Amendment and such other Loan Documents.
SECTION 13. GOVERNING LAW. This Amendment shall be governed by and
construed in accordance with the laws of the State of Texas.
SECTION 14. HEADINGS. Section headings in this Amendment are included
herein for convenience and reference only and shall not constitute a part of
this Amendment for any other purpose.
SECTION 15. NO ORAL AGREEMENTS. THE ORIGINAL AGREEMENT (AS AMENDED BY
THIS AMENDMENT) AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES 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.
[THE REMAINDER OF THIS PAGE INTENTIONALLY BLANK. SIGNATURE PAGES TO FOLLOW]
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IN WITNESS WHEREOF, the parties have executed this Amendment to Credit Agreement
the day and year first above written.
BORROWER:
Address for Notice: ATLAS AMERICA, INC., a Delaware
corporation
Atlas America, Inc.
c/o Resource America, Inc.
1845 Walnut Street, 10th Floor By:________________________________
Philadelphia, Pennsylvania 19103 Name:______________________________
Attention: Steven Kessler Title:_____________________________
Fax No.: 215.546.4785
E-mail: skessler@resourceamerica.com
GUARANTORS:
AIC, INC., a Delaware corporation
By:________________________________
Name:______________________________
Title:_____________________________
ATLAS AMERICA, INC., a Pennsylvania
corporation
By:________________________________
Name:______________________________
Title:_____________________________
S-1
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
ATLAS ENERGY CORPORATION an
Ohio corporation
By:________________________________
Name:______________________________
Title:_____________________________
ATLAS ENERGY GROUP, INC., an Ohio
corporation
By:________________________________
Name:______________________________
Title:_____________________________
ATLAS ENERGY HOLDINGS, INC., a
Delaware corporation
By:________________________________
Name:______________________________
Title:_____________________________
ATLAS NOBLE CORP., a
Delaware corporation
By:________________________________
Name:______________________________
Title:_____________________________
S-2
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
ATLAS PIPELINE PARTNERS GP, LLC, a
Delaware limited liability company
By:________________________________
Name:______________________________
Title:_____________________________
ATLAS RESOURCES, INC., a
Pennsylvania corporation
By:________________________________
Name:______________________________
Title:_____________________________
REI-NY, INC., a
Delaware corporation
By:________________________________
Name:______________________________
Title:_____________________________
RESOURCE AMERICA, INC., a
Delaware corporation
By:________________________________
Name:______________________________
Title:_____________________________
S-3
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
RESOURCE ENERGY, INC., a
Delaware corporation
By:________________________________
Name:______________________________
Title:_____________________________
VIKING RESOURCES CORPORATION, a
Pennsylvania corporation
By:________________________________
Name:______________________________
Title:_____________________________
S-4
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
LENDER, ADMINISTRATIVE AGENT AND
ISSUING BANK:
WACHOVIA BANK, NATIONAL ASSOCIATION
Individually, Administrative Agent
and Issuing Bank
By:________________________________
Russell Clingman
Director
Lending Office for Base Rate Loans
and LIBOR Loans and Address for
Notices:
Wachovia Bank, National Association
1001 Fannin, Suite 2255
Houston, Texas 77002
Telephone No.: 713-346-2716
Telecopier No.: 713-650-6354
Attention: Russell Clingman
S-5
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
U.S. BANK, NATIONAL ASSOCIATION
By:____________________________________________
Name:__________________________________________
Title:_________________________________________
Contact
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Primary Credit and Financials: Monte E. Deckerd
918 17th Street
DNCOBB3E
Denver, CO 80202
Tel: (303) 585-4212
Fax: (303) 585-4362
monte.deckerd@usbank.com
S-6
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
BANK OF OKLAHOMA, N.A.
By:________________________________
Name:______________________________
Title:_____________________________
Contact
-------
Primary Credit: Lindsay Sherrer
One Williams Center 8-SE
Tulsa OK 74192
Tel: (918) 295-0414
Fax: (918) 588-6880
lsherrer@mail.bok.com
S-7
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
COMPASS BANK
By:________________________________
Name:______________________________
Title:_____________________________
Contact
-------
Primary Credit: Dorothy Marchand
24 Greenway Plaza, Suite 1400A
Houston, TX 77046
Tel: (713) 968-8272
Fax: (713) 968-8292
dorothy.marchand@compassbnk.com
S-8
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
TEXAS CAPITAL BANK, N.A.
By:________________________________
Name:______________________________
Title:_____________________________
Contact
-------
Primary Credit: Mike Black
One Riverway, Suite 2450
Houston, TX 77056
Tel: (713) 439-5904
Fax: (713) 439-5947
mike.black@texascapitalbank.com
By: /s/ Michael L. Staines
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Name: Michael L. Staines
----------------------------
Title: President
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Date: 6/16/2004
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S-9
SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT
[GRAPHIC OMITTED]
Atlas
America, Inc.
EXHIBIT A
---------
June 10, 2004
Atlas Pipeline Partners, L.P.
1845 Walnut Street
Philadelphia, PA 19103
Ladies and Gentlemen:
Atlas America, Inc. ("AAI") is pleased to offer its commitment to purchase up to
$10.0 million of preferred units in Atlas Pipeline Operating Partnership, L.P.
upon the closing (the "Closing") of the acquisition by you of all of the equity
interests of Spectrum Field Services, Inc., all in accordance with the attached
Term Sheet.
In consideration for its commitment, you will pay to AAI the fees set forth on
the Term sheet, which shall be earned and non-refundable once payable in
accordance with the Term Sheet. Whether or not the transactions hereby
contemplated proceed to Closing, you agree to pay the AAI's out-of-pocket
expenses as described in the Term Sheet. Out-of-pocket expenses will be paid by
you promptly upon billing.
If you are in agreement with the foregoing, please sign where indicated below
and return to the undersigned the original fully executed Commitment Letter.
Upon receipt of the same, this Commitment Letter shall become effective to the
extent and in the manner provided herein.
Sincerely,
ATLAS AMERICA, INC.
By: /s/ Freddie Kotek
---------------------------
Name: Freddie Kotek
Title: Executive Vice President & CEO
AGREED TO AND ACCEPTED BY:
ATLAS PIPELINE PARTNERS, L.P.
By: Atlas Pipeline Partners GP, LLC,
its sole general partner
By: /s/ Michael L. Staines
--------------------------------------
Name: Michael L. Staines
Title: President
Date: 6/16/2004
ATLAS PIPELINE PARTNERS L.P.
----------------------------
Commitment to Purchase Preferred Limited Partner Interests
in Atlas Pipeline Operating Partnership, L.P.
Summary of Principal Terms and Conditions
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PROPOSED SPECTRUM TRANSACTION: Atlas Pipeline Partners L.P. ("APL" or the
"Company") shall acquire all of the capital stock of
Spectrum Field Services, Inc. ("Spectrum") for total
cash consideration of $57 million, plus the payoff of
$15.6 million of subordinated notes payable to
Energy Spectrum Partners and $31.5 million of bank
debt. Further, APL will realize a $35.6 million tax
liability upon the liquidation of the Spectrum
C-corp. The total value of the consideration, the debt
pay-offs and the tax liquidation liability is $140
million. Total fees and expenses of $5 million are
expected.
The SPA will be signed without a financing
contingency by June 15, 2004. Closing is expected
in mid-July 2004.
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COMMITMENT TO PURCHASE PREFERRED PARTNERSHIP In connection with the closing of Spectrum, the
UNITS OF ATLAS PIPELINE OPERATING PARTNERSHIP, Company may request that Atlas America, Inc.
L.P. ("AAI") purchase preferred partnership units (the
"Preferred Units") of Atlas Pipeline Operating
Partnership, L.P. ("OLP") at a purchase price of
$25 per unit (the "Initial Purchase Price").
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COMMITMENT AMOUNT: $10,000,000
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DISTRIBUTIONS TO PREFERRED UNITS: OLP shall make cumulative cash distributions to the
Preferred Units equal to 12% per ammum, payable
monthly and calculated on a 360/30 day basis.
Distributions to the Preferred Units shall be senior
in right of payment to all other equity units of OLP,
including distributions to the general partner.
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APL PURCHASE OPTION: APL shall have the right to purchase, at any time, in
all or in part, the Preferred Units at the Initial
Purchase Price plus accrued and unpaid preferred
unit distributions, plus the Purchase Premium
described below.
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PURCHASE PREMIUM: During the first 90 days after the funding of the
Preferred Units, the Purchase Premium shall equal
2% of the amount repurchased. The Purchase
Premium shall increase by 1% per month on the first
day of each successive month, beginning on the 91st
day after funding.
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EXPIRATION OF THE COMMITMENT: The earlier of [December 1, 2004] or the successful
offering of equity units of APL of at least $25
million, net.
APL may terminate the commitment at anytime,
subject to the Commitment Fee and Termination Fee
outlined below.
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LIQUIDATION PREFERENCE: Upon liquidation of OLP, proceeds remaining after
payment of the Senior Bank Credit Facility, other
creditors and the costs and expenses of liquidation
will be applied first to the payment of the Initial
Purchase Price of the Preferred Units, plus the
applicable Purchase Premium and the cumulative
unpaid distributions thereon; then to other equity
owners of OLP.
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VOTING RIGHTS: The Preferred Units shall have equal voting rights as
the OLP limited partners.
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TRANSFERABILITY: AAI shall have the right to transfer the Preferred
Units, subject to applicable state and federal
securities laws, subject to a right of first refusal by
APL.
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COMMITMENT FEE: 1.5% of the Committed Amount upon signing the
commitment letter.
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TERMINATION OR FUNDING FEE: 3.5% of the Committed Amount.
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EXPENSES: APL shall pay all reasonable out-of-pocket travel,
due diligence, legal and accounting fees and
expenses of AAI.
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CONDITIONS PRECEDENT TO COMMITMENT: o Definitive Purchase Agreement for the
Preferred Units.
o An effective shelf registration for the
issuance of APL common units.
o APL shall not be in default of its
partnership agreement or related
agreements as a result of the commitment
or the possibility that the Preferred Units
could be funded.
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CONDITIONS PRECEDENT TO FUNDING: o APL has executed definitive Purchase and
Sale Agreement for the acquisition of
Spectrum.
o APL continues to maintain an effective
shelf registration statement with sufficient
availability to repurchase the Preferred
Units.
o The Senior Secured Credit Facility is
funded and no event of default exists or
could be expected to occur as a result of the
funding of the Preferred Units.
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EXCHANGEABILITY: At any time after January 1, 2005, AAI may choose
to exchange the Preferred Units for common units of
APL based on market price of common units
immediately prior to conversion.
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