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EXHIBIT 4.5
FIRST AMENDMENT
TO
CONTINGENT VALUE RIGHTS AGREEMENT
This First Amendment to Contingent Value Rights Agreement ("First
Amendment") dated as of May 2, 1996 by and between Abraxas Petroleum
Corporation, a Nevada corporation (the "Company"), and First Union National
Bank of North Carolina (the "Rights Agent").
W I T N E S S E T H:
WHEREAS, the Company and the Rights Agent have previously executed and
delivered that certain Contingent Value Rights Agreement dated as of November
17, 1995 (the "Original Agreement" and, together with this First Amendment, the
"Agreement");
WHEREAS, the Company's Board of Directors has approved this First
Amendment;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the Company and the Rights Agent agree as follows:
1. Unless otherwise defined in this First Amendment, all
capitalized terms used herein shall have the meaning set forth in the Original
Agreement.
2. Section 1.05(b) of the Original Agreement is hereby amended to
read, in its entirety, as follows:
"(b) the Company by the Rights Agent or by any Holder shall be
sufficient for every purpose hereunder if in writing and mailed,
first-class postage prepaid, to the Company addressed to it at 500
North Loop 1604 East, Suite 100, San Antonio, Texas 78232 Attention:
Chief Financial Officer, or at any other address previously furnished
in writing to the Rights Agent by the Company."
3. Section 8.01(c) is hereby added to the Original Agreement and
reads, in its entirety, as follows:
"(c) In the event that the Company shall consolidate with or merge
into any other Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person or is liquidated
(each, a "Transaction"), the Holders of the CVRs shall be entitled to
receive shares of the capital stock or securities
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of the Surviving Person or such other consideration that holders of
shares of the Common Stock received in such a Transaction as follows:
(1) in the event of a Transaction in which the
consideration received by the holders of the Common
Stock is shares of the capital stock or other
securities of the Surviving Person, the Surviving
Person shall issue to each Holder of a CVR
Certificate at the Maturity Date, unless the
Surviving Person shall, in its sole discretion,
extend the Maturity Date to the Extended Maturity
Date, then at the Extended Maturity Date, for each
CVR held by such Holder, upon presentment by such
Holder of such Holder's CVR Certificate, the number
of shares of capital stock or other securities of the
Surviving Person equal to a fraction, the numerator
of which is the Adjusted Target Price (as defined
below) minus the Adjusted Current Market Value (as
defined below) per share and the denominator of which
is the Adjusted Current Market Value per share;
provided, however, in no event shall the Surviving
Person (a) be required to issue a number of shares of
its capital stock or other securities greater than
(i) 1.0 times the Conversion Ratio (as defined below)
on the Maturity Date or (ii) 1.5 times the Conversion
Ratio on the Extended Maturity Date and (b) issue
shares of its capital stock or other securities which
are not publicly traded to the Holders for any CVRs
held by them. In the event that the shares of
capital stock or other securities of the Surviving
Person to be issued in a Transaction are not publicly
traded, the consideration to be received by the
Holders for any CVRs held by them in a Transaction
shall be cash in accordance with the terms of Section
8.01(c)(2) hereof. All determinations by the
Surviving Person in connection with this Section
8.01(c), absent manifest error, shall be final and
binding on the Surviving Person and the Holders;
(2) in the event of a Transaction in which the holders of
Common Stock receive cash, the Surviving Person shall
pay to each Holder of a CVR Certificate, on the
effective date of such a Transaction, for each CVR
held by such Holder, upon presentment by such Holder
of such Holder's CVR Certificate, an amount of cash
equal to the Target Price minus the amount of cash
received by the stockholders of the Company for one
share of the Common Stock; provided, however, (i) in
no event shall any Holder receive greater than $5.00
per CVR on or prior to the Maturity Date and $7.50
per CVR from and after the Maturity Date to and
including the Extended Maturity Date and (ii) that in
the event that the amount of cash per share received
by the holders of the Common Stock is greater than
the Target Price, the Holders shall not receive any
cash for any CVRs held by them.
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(3) As used in this Section 8.01(c), the following
capitalized terms shall have the following meanings:
(i) "Adjusted Current Market Value" per share
means, with respect to the Maturity Date or the
Extended Maturity Date, the median of the averages of
the closing bid prices of the shares of capital stock
or other securities of the Surviving Person received
by the holders of Common Stock in a Transaction on
the principal stock exchange on which such shares of
capital stock or other securities are traded during
each 20 consecutive Trading Day period that both
begins and ends in the Valuation Period;
(ii) "Adjusted Target Price" means the Target
Price divided by the Conversion Ratio; and
(iii) "Conversion Ratio" means the number of shares
of capital stock or other securities of the Surviving
Person received by the Holder of one (1) share of the
Common Stock."
3. Except as expressly amended hereby, the Original Agreement
remains in full force and effect. Any references to the Original Agreement in
the CVR Certificates shall refer to the Agreement as amended hereby.
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first written above.
ABRAXAS PETROLEUM CORPORATION
By:
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Robert L. G. Watson,
Chairman of the Board,
Chief Executive Officer and
President
ATTEST:
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Stephen T. Wendel, Secretary
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
By:
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Title:
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