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EXHIBIT 4.2.3
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
(herein called this "Amendment") made as of the 5th day of March, 1999 by and
among Inland Production Company, a Texas corporation, (herein called
"Borrower"), Inland Resources Inc., a Washington corporation (herein called
"Parent"), and Trust Company of the West, in its capacity as holder of the Note
(in such capacity, "Noteholder"), and TCW Asset Management Company, in its
capacities as Agent and Collateral Agent ("Agent").
W I T N E S S E T H:
WHEREAS, Borrower, Parent, Noteholder, and Agent, have entered
into that certain Amended and Restated Credit Agreement dated as of September
11, 1998 (as amended, restated, or supplemented to the date hereof, the "Amended
Agreement");
WHEREAS, Borrower, Parent, Agent Bank, and the Banks have
entered into that certain Amended and Restated Credit Agreement dated as of
September 11, 1998, (as amended, restated, or supplemented to the date hereof,
the "Amended Bank Agreement'), for the purposes and consideration therein
expressed, pursuant to which the Banks became obligated to make loans to
Borrower as therein provided:
WHEREAS, Borrower, Parent, Noteholder, Agent, Agent Bank and
Banks have entered into that certain Amended and Restated Intercreditor
Agreement dated as of September 11, 1998, as amended, restated, or supplemented
to the date hereof;
WHEREAS, Borrower, Parent, Noteholder and Agent desire to
amend the Amended Agreement as provided herein;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements contained herein and in the Amended Agreement,
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto do hereby agree as follows:
Article I.
Definitions and References
Section 1.1. Terms Defined in the Amended Agreement. Unless the context
otherwise requires or unless otherwise expressly defined herein, the terms
defined in the Amended Agreement shall have the same meaning whenever used in
this Agreement.
Article II.
Amendments to Amended Agreement
Section 2.1. Deferral of Scheduled Interest Payments. Notwithstanding
Section 2.1 of the Amended Agreement, the interest accruing on the Notes for the
period beginning on January 1, 1999 and ending June 30, 1999 and otherwise due
on the Quarterly Payment Dates in March 1999
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and June 1999 (the "Deferred Interest") shall be deferred and be payable on the
Initial Amortization Date. The Deferred Interest shall bear interest at the Late
Payment Rate, compounded quarterly, from the Quarterly Payment Dates on which it
was originally due until paid.
Section 2.2. Additional Covenant. Subsection 5.1(g) is hereby added to
Section 5.1 of the Amended Agreement immediately after Subsection 5.1(f) thereof
as follows:
(g) Hedging Contracts. Within ten (10) days of receipt of a
written request from Agent, on behalf of the Noteholder, Borrower shall
enter into, or cause any other Related Person to enter into, any
forward, swap or hedging contract with respect to projected hydrocarbon
production or refined product production of any Related Person that
Agent requests such Related Person enter into. Borrower, and by their
consent hereto Parent and Inland Refining, hereby waive and release any
claim against Agent, Noteholder or Collateral Agent arising from any
loss, cost, expense, claim or liability incurred by any Related Person
arising from any forward, swap or hedging agreement or contract entered
into by any Related Person pursuant to the request of Agent as provided
herein.
Section 2.3. Additional Covenant. Section 6.6 of the Amended Agreement
is hereby added as follows:
"Section 6.6. LockBox Management. Parent and Borrower shall,
and shall cause Inland Refining to, direct all proceeds from the sales
of crude oil and natural gas ("E&P revenue") and petroleum products
("refining revenue") to be deposited into one or more lockboxes in the
name of Parent, Borrower or Inland Refining, as the case may be, and
administered by U.S. Bank National Association subject to a first
priority security interest securing the Bank Debt and a second priority
security interest securing the Obligations. Parent and Borrower agree
that if the proceeds of any E&P revenue or refining revenue shall be
received by it or by any other Related Person, Parent shall as promptly
as possible deposit such proceeds into the lockbox account, such
account to be administered by and held at U.S. Bank, National
Association. Until so deposited, all such E&P revenue and refining
revenue proceeds shall be held in trust by Parent and shall not be
commingled with any other funds or property of Parent."
Article III.
Conditions of Effectiveness
Section 3.1. Effective Date. This Amendment shall become effective as
of the date first above written when and only when Agent shall have received, at
Agent's office.
(i) a counterpart of this Amendment executed and delivered
by Borrower,
(ii) a certificate of a duly authorized officer of
Borrower to the effect that all of the representations and warranties
set forth in Article IV hereof are true and correct at and as of the
time of such effectiveness,
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(iii) evidence acceptable to Agent in its sole discretion
that all of the conditions of effectiveness to the First Amendment of
the Amended Bank Agreement in the form of Exhibit 1 hereto have been
satisfied,
(iv) lockbox agreement executed and delivered by Parent,
Borrower and Refining, in form and substance acceptable for U.S. Bank
National Association and Agent,
(v) Warrants issued to purchase Fifty-Eight Thousand Five
Hundred Twelve (58,512) shares of common stock of Inland Resources,
Inc., in the form of Exhibit 2 hereto,
(vi) Warrant Agreement in the form of Exhibit 3 hereto,
and
(vii) a First Amendment to the Amended and Restated
Intercreditor Agreement in the form of Exhibit 4 hereto executed by all
parties named therein.
Article IV.
Representations and Warranties
Section 4.1. Representations and Warranties of Borrower. In order to
induce Agent and Noteholder to enter into this Amendment, Borrower represents
and warrants to Agent and Noteholder that:
(a) The representations and warranties contained in
Article V of the Amended Agreement are true and correct at and as of
the time of the effectiveness hereof.
(b) Each of Borrower, Parent and Inland Refining is duly
authorized to execute and deliver this Amendment and the documents
listed in Sections 3.1(iv), (v), (vi) and (vii) (collectively, with
this Amendment, the "Amendment Documents") to which it is a party and
is and will continue to be duly authorized to perform its obligations
under the Amended Agreement and the other Amendment Documents. Each of
Borrower, Parent and Inland Refining has duly taken all action
necessary to authorize the execution and delivery of this Amendment and
the other Amendment Documents to which it is a party and to authorize
the performance of the obligations of Borrower, Parent and Inland
Refining hereunder and thereunder.
(c) The execution and delivery by each of Borrower, Parent
and Inland Refining of this Amendment and the other Amendment Documents
to which it is a party, the performance by each of Borrower, Parent and
Inland Refining of its obligations hereunder and thereunder and the
consummation of the transactions contemplated hereby and thereby do not
and will not conflict with any provision of law, statute, rule or
regulation or of the articles of organization and regulations of
Borrower, Parent or Inland Refining, or of any material agreement,
judgment, license, order or permit applicable to or binding upon
Borrower, Parent or Inland Refining or result in the creation of any
lien, charge or encumbrance upon any assets or properties of Borrower,
Parent or Inland Refining. Except for those which have been duly
obtained, no consent, approval,
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authorization or order of any court or governmental authority or this
party is required in connection with the execution and delivery by each
of Borrower, Parent or Inland Refining of this Amendment and the other
Amendment Documents to which it is a party or to consummate the
transaction contemplated hereby and thereby.
(d) When duly executed and delivered, each of this
Amendment, the Amended Agreement and the other Amendment Documents will
be a legal and binding instrument and agreement of Borrower, Parent and
Inland Refining, enforceable in accordance with its terms, except as
limited by bankruptcy, insolvency and similar laws applying to
creditors' rights generally and by principles of equity applying to
creditors' rights generally. No setoff, defense or counterclaim exists
with respect to any of the Obligations or otherwise with respect to any
of the obligations or duties of any Related Person under or in respect
of any of the Loan Documents.
(e) The unaudited quarterly financial statements of
Borrower, Parent and Inland Refining dated as of December 31, 1998
fairly present the financial position at such date and the statement of
operations and the changes in financial position for the period ending
on such date for Borrower, Parent and Inland Refining. Copies of such
financial statements have heretofore been delivered to Agent. Since
December 31, 1998, no material adverse change has occurred in the
financial condition or businesses of Borrower, Parent or Inland
Refining.
Article V.
Miscellaneous
Section 5.1. Ratification of Agreements; Release. The Amended Agreement
as hereby amended is hereby ratified and confirmed in all respects. The
execution, delivery and effectiveness of this Amendment and the other Amendment
Documents shall not, except as expressly provided herein or therein, operate as
a waiver of any right, power or remedy of Agent under the Amended Agreement or
any other Loan Document nor constitute a waiver of any provision of the Amended
Agreement or any other Loan Document. As further consideration and to induce the
Agent and the Collateral Agent to enter into and grant the accommodations
contained in this First Amendment, Borrower and by their consent hereto each of
Parent and Inland Refining, hereby also compromises, releases and discharges the
Noteholder, the Agent, Collateral Agent and their respective directors,
officers, shareholders, agents, employees, representatives, attorneys, and their
respective heirs, legal representatives, successors and assigns (collectively,
the "Lending Parties") from any and all claims, demands, causes of action,
remedies, suites, judgments, damages, expenses and liabilities (collectively,
"Claims") of any nature whatsoever, whether now know, suspected or claimed,
whether arising under common law, in equity, or under statute, which the
Borrower, Parent or Inland Refining has against the Lending Parties which may
have arisen at any time on or prior to the date hereof in connection with,
arising out of or related to the Loans, the Agreement and all Loan Documents
executed in connection therewith, or the enforcement or attempted enforcement by
the Noteholder, Collateral Agent or Agent of any of their rights, remedies, or
recourse related thereto.
Section 5.2. Survival of Agreements. All representations, warranties,
covenants and agreements of Borrower or any other Related Person herein shall
survive the execution and
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delivery of this Amendment and the performance hereof and shall further survive
until all of the Obligations are paid in full. All representations, warranties,
acknowledgments and agreements contained in the Amended Agreement are hereby
reconfirmed on and as of the date hereof. All statements and agreements
contained in any certificate or instrument delivered by Borrower hereunder or
under the Amended Agreement to Noteholder shall be deemed to constitute
representations and warranties by, or agreements and covenants of, Borrower
under this Amendment and under the Amended Agreement.
Section 5.3. Loan Documents. This Amendment and the other Amendment
Documents are each a Loan Document, and all provisions in the Amended Agreement
pertaining to Loan Documents apply hereto and thereto.
Section 5.4. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of California and any
applicable laws of the United States of America in all respects, including
construction, validity and performance.
Section 5.5. Counterparts. This Amendment may be separately executed
in counterparts and by the different parties hereto in separate counterparts,
each of which when so executed shall be deemed to constitute one and the same
Amendment.
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 AGREEMENT OF THE PARTIES.
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IN WITNESS WHEREOF, this Amendment is executed as of the date
first above written.
BORROWER: INLAND PRODUCTION COMPANY
By:
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Bill I. Pennington
Chief Financial Officer
Address:
410 17th Street, Suite 700
Denver, Colorado 80202
Attention: Kyle Miller
Telephone: (303) 893-0102
Telecopy: (303) 893-0103
PARENT: INLAND RESOURCES INC.
By:
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Bill I. Pennington
Chief Financial Officer
Address:
410 17th Street, Suite 700
Denver, Colorado 80202
Attention: Kyle Miller
Telephone: (303) 893-0102
Telecopy: (303) 893-0103
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NOTEHOLDER: TRUST COMPANY OF THE WEST, a California
trust company, as Sub-Custodian for Mellon
Bank for the benefit of Account No.
CPFF 873-3032
By:
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Arthur R. Carlson
Managing Director
By:
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Marc MacAluso
Senior Vice President
AGENT: TCW ASSET MANAGEMENT
COMPANY, a California
corporation, as Investment
Manager under that certain
Agreement dated as of June
13, 1994, between TCW Asset
Management Company and
Morgan Stanley Group, Inc.
By:
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Arthur R. Carlson
Managing Director
By:
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Marc MacAluso
Senior Vice President
COLLATERAL AGENT: TCW ASSET MANAGEMENT COMPANY, a California
corporation
By:
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Arthur R. Carlson
Managing Director
By:
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Marc MacAluso
Senior Vice President
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CONSENT AND AGREEMENT
Pursuant to the terms of that certain Amended and Restated
Intercreditor Agreement dated September 11, 1998, among Borrower, Parent, Agent,
the Banks, the Noteholder named therein, and the undersigned hereby consent to
the foregoing First Amendment to Amended and Restated Credit Agreement.
Bank and Agent ING (U.S.) CAPITAL LLC (successor to ING
(U.S.) Capital Corporation), as a Bank
and as Agent
By:
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Christopher R. Wagner
Vice President
Banks U.S. BANK AND NATIONAL ASSOCIATION
By:
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Name:
Title:
MEESPIERSON CAPITAL CORP.
By:
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Name:
Title:
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CONSENT AND AGREEMENT
Parent and Inland Refining hereby consent to the provision of
this Amendment and the transactions contemplated herein, and hereby ratify and
confirm their respective Guaranty dated as of September 11, 1998, made by them
for the benefit of Agent, and agree that their obligations and covenants
thereunder are unimpaired hereby and shall remain in full force and effect.
INLAND RESOURCES, INC.
By:
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Bill I. Pennington
Chief Financial Officer
INLAND REFINING, INC.
By:
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Bill Fink
President
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