Document:

exv10w6

 

Exhibit 10.6

FIFTH AMENDMENT

TO

FINANCING AGREEMENT

Dated as of January 15, 2004

among

ENCORE WIRE LIMITED,

as Borrower

BANK OF AMERICA, N.A.,

as Agent,

BANK ONE, NA,

GUARANTY BANK

WELLS FARGO BANK, N.A.,

as Co-Syndication Agents

and

The Other Lenders Party Thereto

BANC OF AMERICA SECURITIES LLC,

as Sole Lead Arranger and Sole Book Manager

 

 

FIFTH AMENDMENT TO FINANCING AGREEMENT

     THIS FIFTH AMENDMENT TO FINANCING AGREEMENT (the “Fifth Amendment”) dated
as of January 15, 2004, is by and among ENCORE WIRE LIMITED, a Texas limited
partnership (“Borrower”), BANK OF AMERICA, N.A. (“Bank of America”), BANK ONE,
NA (“Bank One”), GUARANTY BANK (“Guaranty Bank”), WELLS FARGO BANK, N.A.
(“Wells Fargo”), COMERICA BANK, (“Comerica Bank”), and HIBERNIA NATIONAL BANK
(“Hibernia”) (Bank One, Guaranty Bank, Wells Fargo and Hibernia are herein
sometimes collectively referred to as the “New Lenders”), in their individual
capacities as “Lenders” (as such term is defined herein), Bank One, Guaranty
Bank and Wells Fargo in their capacities as “Co-Syndication Agents” (as such
term is defined herein), and Bank of America, N.A., as agent for itself and
other Lenders (in such capacity, together with its successors in such capacity,
the “Agent”).

WITNESSETH:

     WHEREAS, the Borrower, the Agent and certain of the Lenders are parties to
the Financing Agreement, dated as of August 31, 1999, as amended by that
certain First Amendment to Financing Agreement, dated as of June 28, 2000, that
certain Second Amendment to Financing Statement, dated as of June 28, 2002,
that certain Third Amendment to Financing Statement, dated as of March 31,
2003, and that certain Fourth Amendment to Financing Agreement, dated as of
November 5, 2003 (said Financing Agreement, as amended, the “Financing
Agreement”), pursuant to which certain of the Lenders agreed to make certain
loans available to the Borrower upon the terms and conditions contained in the
Financing Agreement;

     WHEREAS, the parties to the Financing Agreement desire to (a) add the New
Lenders as Lenders under the Financing Agreement and (b) amend the Financing
Agreement to make certain changes to the terms therein upon the terms and
conditions set forth below;

     NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Borrower, the Lenders, the Co-Syndication
Agents and the Agent agree as follows:

Terms. All capitalized terms defined in the Financing Agreement and not

otherwise defined herein shall have the same definitions when used herein as

set forth in the Financing Agreement as amended.

Amendment of Paragraph 1.20. Paragraph 1.20 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               “Comerica Bank” means Comerica Bank, successor by merger with
Comerica Bank — Texas, in its individual capacity as a Lender.

Amendment of Paragraph 1.21. Paragraph 1.21 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               1.21 “Contract Term” means the period beginning on the effective
date specified in the preamble of this Agreement and continuing through
May 31, 2007.

Amendment of Paragraph 1.22. Paragraph 1.22 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               1.22 “Commitment” means, as to any Lender, the obligation of such
Lender to make or continue Loans and incur or participate in Letter of
Credit Liabilities hereunder in an aggregate principal amount at any one
time outstanding up to but not exceeding the amount set forth opposite
the name of such Lender on the signature pages of the Fifth Amendment
under the heading “Commitment” or, if such Lender is a party to an
Assignment and Acceptance, the amount of the “Commitment” set forth in
the most recent Assignment and Acceptance of such Lender, as the same may
be reduced or terminated pursuant to paragraph 2.9 or 9.2, and
“Commitments” means such obligations of all Lenders. As of the Fifth
Amendment Closing Date, the aggregate principal amount of the Commitments
is $125,000,000.

Amendment of Paragraph 1.29. Paragraph 1.29 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               1.29 “Eligible Assignee” means (a) any Affiliate of a Lender, (b) a
Lender, (c) an Approved Fund or (d) any commercial bank, savings and loan
association, savings bank, finance company, insurance company, pension
fund, mutual fund or other financial institution having combined capital

 

 

and surplus of at least $100,000,000 (whether a corporation,
partnership or other entity) acceptable to Agent; provided however, so
long as no Default exists, any such entity described in (d) must also be
approved by Borrower, which approval may not be unreasonably withheld.

Amendment of Paragraph 1.30. Paragraph 1.30 in ARTICLE I of the Financing

Agreement is amended by adding the following sentence to the end thereof:

Notwithstanding anything herein to the contrary, in no event shall
work-in-progress be included in Eligible Inventory.

Amendment of Paragraph 1.55. Paragraph 1.55 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               1.55 “Lender” and “Lenders” means each of Bank of America, Bank One,
Guaranty Bank, Wells Fargo, Comerica, and Hibernia, in their individual
capacities as lenders hereunder, and each other lending institution which
may from time to time become a party hereto or any successor or assignee
of any thereof.

Amendment of Paragraph 1.68. Paragraph 1.68 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               1.68 “Maximum Rate” means the greater of (i) the “weekly ceiling” as
defined in Section 303.003 of the Texas Finance Code, as amended, or (ii)
the maximum rate of interest permitted from day to day by any other
applicable state or federal law.

Amendment of Paragraph 1.84. Paragraph 1.84 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               1.84 “Required Lenders” means, at any date of determination, Lenders
having in aggregate at least 66-2/3% (in Dollar amount) of the aggregate
amount of the outstanding Commitments (or, if such Commitments have
terminated or expired, the aggregate principal amount of the Loans and
the aggregate Letter of Credit Liabilities).

Amendment of Paragraph 1.86. Paragraph 1.86 in ARTICLE I of the Financing

Agreement is amended and restated in its entirety as follows:

               1.86 “Revolving Credit Limit” means the amount of One-Hundred
Twenty-Five Million Dollars ($125,000,000) for the period commencing on
the Fifth Amendment Closing Date through and until the last day of the
Contract Term, as such amount may be decreased pursuant to paragraph 2.9
or increased pursuant to paragraph 2.12.

Amendment of ARTICLE I. ARTICLE I of the Financing Agreement is amended by

adding the following defined terms thereto in proper alphabetical order to read

as follows:

               1.6A “Approved Fund” means any Fund that is administered or managed
by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

               1.13A “Bank One” means Bank One, NA, in its individual capacity as a
Lender.

               1.23A “Co-Syndication Agents” means each of Bank One, Guaranty Bank
and Wells Fargo, in their respective capacity as co-syndication agent
under this Agreement.

               1.40A “Fifth Amendment” means that certain Fifth Amendment to
Financing Agreement, dated as of January 15, 2004, among Borrower, Agent
and the lenders named therein.

               1.40B “Fifth Amendment Closing Date” means the date that all of the
conditions precedent set forth in Section 46 of the Fifth Amendment.

               1.42A “Fund” means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the
ordinary course of business.

               1.46A “Guaranty Bank” means Guaranty Bank, in its individual capacity as a Lender.

 

 

               1.48A “Hibernia” means Hibernia National Bank, in its individual capacity as a Lender.

               1.48B “Increase Closing Date” shall have the meaning specified in paragraph 2.12(b).

               1.89A “Wells Fargo” means Wells Fargo Bank, N.A., in its individual capacity as a Lender.

               1.89B “Unused Portion” means an amount equal to the result of (a)
the Commitments minus (b) the sum of (i) the outstanding Loans and (ii)
the outstanding Letter of Credit Liabilities.

Paragraph 1.90 in ARTICLE I of the Financing Agreement is renumbered as

“Paragraph 1.70A” and inserted in proper numerical order in ARTICLE I.

Amendment of Paragraph 2.8. Paragraph 2.8 in ARTICLE II of the Financing

Agreement is amended and restated in its entirety as follows:

               2.8 Commitment Fee. Subject in all respects to the provisions of
paragraph 11.8, Borrower agrees to pay to Agent, for the account of each
Lender (based upon their respective Commitment Percentages) a commitment
fee in an amount equal to (i) 0.175% per annum if the Leverage Ratio is
equal to or less than 0.50 to 1, (ii) 0.250% if the Leverage Ratio is
greater than 0.50 to 1 and less than or equal to 2.75 to 1, (iii) 0.375%
if the Leverage Ratio is greater than 2.75 to 1 and less than or equal to
3.00 to 1, or (iv) 0.500% if the Leverage Ratio is greater than 3.00 to
1, of the Unused Portion (calculated on a daily basis for the applicable
quarterly period or portion thereof), which shall be payable quarterly in
arrears on the first day of each April, July, October and January during
the term hereof and on the date of termination of the Facility.

Amendment of Paragraph 2.10(a). Paragraph 2.10(a) in ARTICLE II of the

Financing Agreement is amended and restated as follows:

               (a) The Facility may be utilized by Borrower to support the issuance
of Letters of Credit for the account of Borrower, subject to the
Availability, up to the maximum aggregate unfunded face amount at any
time outstanding of $5,000,000.00. The maximum term of any such Letter
of Credit shall be one (1) year, and no Letter of Credit shall be issued
with an expiration date which is later than seven (7) days prior to the
expiration of the Contract Term. Each Letter of Credit shall be governed
and supported by a duly executed application and reimbursement agreement
in form and substance satisfactory to the Issuing Bank, and subject in
all respects to the provisions of paragraph 11.8, Borrower agrees to pay
to Agent, for the account of each Lender (based on their respective
Commitment Percentages) a Letter of Credit fee for each Letter of Credit
equal to 1% per annum of the maximum amount available to be drawn under
such Letter of Credit (calculated on a daily basis for the applicable
quarterly period or portion thereof), which shall be payable quarterly in
arrears on the first day of each April, July, October and January during
the term hereof and on the date of termination of the Facility.

Amendment of Paragraph 2.10(c). Paragraph 2.10(c) in ARTICLE II of the

Financing Agreement is amended by amending and restating the last sentence

thereof as follows:

Outstanding Reimbursement Obligations shall bear interest at a rate per
annum equal to the lesser of (i) the Prime Based Rate or (ii) the Maximum
Rate.

Amendment of ARTICLE II. ARTICLE II of the Financing Agreement is amended by

adding a new paragraph 2.12 thereto to read as follows:

               2.12 Increase in Commitments. (a) Provided there exists no Default,
upon notice to Agent (which shall promptly notify Lenders), Borrower may
from time to time, request an increase in the Commitments by an amount
(for all such requests) not exceeding $25,000,000. At the time of
sending such notice, Borrower (in consultation with Agent) shall specify
the time period within which each Lender is requested to respond (which
shall in no event be less than ten Business Days from the date of
delivery of such notice to Lender). Each Lender shall notify Agent
within such time period whether or not it agrees to increase its
Commitment and, if so, whether by an amount equal to, greater than, or
less than its pro rata share of such requested increase. Any Lender not
responding within such time period shall be deemed to have declined to
increase its Commitment. Agent shall notify Borrower and each Lender of
Lenders’ responses to each request made hereunder. To achieve the full
amount of a requested increase as a result of all or a portion of Lenders
at such time not increasing their respective Commitments in an aggregate
amount to the increased amount of Commitments requested by

 

 

Borrower, Borrower may also invite additional Eligible Assignees to
become Lenders pursuant to a joinder agreement in form and substance
satisfactory to Agent and its counsel.

               (b) If the Aggregate Commitments are increased in accordance with
this paragraph 2.12, Agent and Borrower shall determine the closing date
(the “Increase Closing Date”) and the final allocation of such increase.
Agent shall promptly notify Borrower and Lenders of the final allocation
of such increase and the Increase Closing Date. As a condition precedent
to such increase, Borrower shall deliver to Agent a certificate of
Borrower and each Guarantor dated as of the Increase Closing Date (in
sufficient copies for each Lender) signed by an officer of Borrower and
each Guarantor (i) certifying and attaching the resolutions adopted by
Borrower and each Guarantor approving or consenting to such increase, and
(ii) in the case of Borrower, certifying that, before and after giving
effect to such increase, (A) the representations and warranties contained
in ARTICLE VI and the other Loan Documents are true and correct on and as
of such Increase Closing Date, except to the extent that such
representations and warranties specifically refer to an earlier date, in
which case they are true and correct as of such earlier date, and (B) no
Default or Event of Default exists or would result therefrom. On the
Increase Closing Date, each Lender shall, to the extent necessary, make a
payment to Agent in an amount sufficient, upon the application of such
payments by all Lenders to the reduction of outstanding Loans held by
Lenders, to cause the principal amount of Loans outstanding made by each
Lender to be in the amount of its pro rata share (after giving effect to
the increase in the Commitments in accordance with this paragraph 2.12)
of all outstanding Loans. Borrower hereby irrevocably authorizes each
Lender to fund to Agent the payment required to be made pursuant to the
immediately preceding sentence for application to the reduction of the
outstanding Loans held by the other Lenders. If, as a result of the
repayment of Loans provided for in this paragraph 2.12, any payment of
LIBOR Based Loans occurs on a day which is not the last day of the
applicable Interest Period, Borrower will pay to Agent for the benefit of
any Lender holding a LIBOR Based Loan any Lender’s Consequential Loss
incurred by such Lender resulting therefrom in accordance with paragraph
3.1.4 to the extent a LIBOR Based Loan is paid on other than the last day
of an Interest Period as a result thereof.

               (c) Upon the Increase Closing Date and the making of the payments
described in paragraph 2.12(b), each new Lender and/or increasing Lender
shall be deemed to have irrevocably and unconditionally purchased and
received, without recourse or warranty, an undivided participation in all
outstanding Letter of Credit Liabilities in accordance with its pro rata
share.

               (d) This Section shall supersede any provisions in paragraph 4.2 or
paragraph 11.18 to the contrary; provided that no Lender shall be
obligated to increase its Commitment.

Amendment of Paragraph 3.1.3 Paragraph 3.1.3 in ARTICLE III of the Financing

Agreement is amended and restated in its entirety as follows:

               3.1.3 Interest Payment Dates. Accrued interest under the Facility
shall be payable as follows: (a) accrued interest on Prime Based Loans
shall be payable quarterly on the first day of each calendar quarter and
on the last day of the Contract Term, and, if applicable, on the day the
outstanding Obligations are due and payable pursuant to paragraph 9.2,
and (b) accrued interest on any LIBOR Based Loan shall be payable on the
last day of the Interest Period applicable thereto and on the last day of
the Contract Term and, if applicable, on the day the outstanding
Obligations are due and payable pursuant to paragraph 9.2; provided,
however, that if any Interest Period for a LIBOR Based Loan exceeds three
months, interest shall also be payable on the date that is three months
after the beginning of such Interest Period.

Amendment of “Applicable Margin” definition in Paragraph 3.1.6. The definition

of “Applicable Margin” contained in paragraph 3.1.6 of ARTICLE III of the

Financing Agreement is amended and restated in its entirety to read as follows:

               “Applicable Margin” means the per annum percentages, applicable in
the case of Prime Based Loans and LIBOR Based Loans, respectively, under
the specified conditions, as follows:

 

 

	 	 	 	 	 	 	 	 	 
	 	 	APPLICABLE MARGIN	 	APPLICABLE MARGIN
	 	 	FOR PRIME BASED	 	FOR LIBOR BASED
	LEVERAGE RATIO
	 	LOANS
	 	LOANS

	Less than or equal to 0.50 to 1.0
Greater than 0.50 to 1.0 and
less than or equal to 1.50 to
1.0

	 	 	0

0	%

%	 	 	0.875

1.125	%

%
	 
	 	 	 	 	 	 	 	 
	Greater than 1.50 to 1.0 and
less than or equal to 2.25 to
1.0

	 	 	0	%	 	 	1.250	%
	 
	 	 	 	 	 	 	 	 
	Greater than 2.25 to 1.0 and
less than or equal to 2.75 to
1.0

	 	 	0	%	 	 	1.500	%
	 
	 	 	 	 	 	 	 	 
	Greater than 2.75 to 1.0 and
less than or equal to 3.00 to
1.0

	 	 	0.25	%	 	 	1.750	%
	 
	 	 	 	 	 	 	 	 
	Greater than 3.00 to 1.0

	 	 	0.50	%	 	 	2.250	%

               The Applicable Margin shall be measured and determined according to
the quarterly consolidated financial statements delivered to Agent under
paragraph 7.6. Any adjustment in the Applicable Margin after the
Effective Date shall be deemed effective as of the first day following
the receipt by the Agent of the financial statements referred to in the
immediately preceding sentence.

Amendment of “Interest Period” definition in Paragraph 3.1.6. The definition

of “Interest Period” contained in paragraph 3.1.6 of ARTICLE III of the

Financing Agreement is amended and restated in its entirety to read as follows:

               “Interest Period” means in the case of a LIBOR Based Loan, the
period commencing on the first effective Eurodollar Business Day of a
LIBOR Rate Option and ending one, two, three or six months thereafter (or
with respect to the initial LIBOR Based Loan made on the Fifth Amendment
Closing Date, twelve days thereafter), as designated by Borrower at the
time of electing such LIBOR Rate Option, provided that (i) if any
Interest Period would otherwise end on a day which is not a Eurodollar
Business Day, then such Interest Period shall be extended to the next
succeeding Eurodollar Business Day unless to do so would extend such
Interest Period into a subsequent calendar month, in which event such
Interest Period shall end on the next preceding Eurodollar Business Day,
and (ii) any Interest Period that begins on the last day of a calendar
month, or on a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period, shall end on the
last Eurodollar Business Day of the last calendar month of such Interest
Period, and provided further, that no Interest Period may end on a day
which is after the expiration of the Contract Term.

Amendment of “London Interbank Offered Rate” definition in Paragraph 3.1.6.

The definition of “London Interbank Offered Rate” contained in paragraph 3.1.6

of ARTICLE III of the Financing Agreement is amended and restated in its

entirety to read as follows:

               “London Interbank Offered Rate” means for any Interest Period with
respect to any LIBOR Based Loan (rounded up to the next 1/100th of 1%):

               (a) the rate per annum equal to the rate determined by Agent
to be the offered rate that appears on the page of the Telerate
screen (or any successor thereto) that displays an average British
Bankers Association Interest Settlement Rate for deposits in
Dollars (for delivery on the first day of such Interest Period)
with a term equivalent to such Interest Period, determined as of
approximately 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period, or

 

 

               (b) if the rate referenced in the preceding clause (a) does
not appear on such page or service or such page or service shall
not be available, the rate per annum equal to the rate determined
by Agent to be the offered rate on such other page or other service
that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first
day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest
Period, or

               (c) if the rates referenced in the preceding clauses (a) and
(b) are not available, the rate per annum determined by Agent as
the rate of interest at which deposits in Dollars for delivery on
the first day of such Interest Period in same day funds in the
approximate amount of the LIBOR Based Loan being made, continued or
converted by Bank of America and with a term equivalent to such
Interest Period would be offered by Bank of America’s London Branch
to major banks in the London interbank eurodollar market at their
request at approximately 4:00 p.m. (London time) two Business Days
prior to the first day of such Interest Period.

Amendment of Prime Based Rate definition in Paragraph 3.1.6. The definition of

“Prime Based Rate” contained in paragraph 3.1.6 of ARTICLE III of the Financing

Agreement is amended and restated in its entirety as follows:

               “Prime Based Rate” means for any date a fluctuating rate per annum
equal to the sum of (a) the higher of the (i) the Federal Funds Rate plus
1/2 of 1% and (ii) the Prime Rate in effect for such day and (b) the
Applicable Margin.

Amendment of “Prime Rate” definition in Paragraph 3.1.6. The definition of

“Prime Rate” contained in paragraph 3.1.6 of ARTICLE III of the Financing

Agreement is amended and restated in its entirety as follows:

               “Prime Rate” means the rate of interest publicly announced from time
to time by Bank of America as its “prime rate”. The Prime Rate is a rate
set by Bank of America based upon various factors including Bank of
America’s costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which
may be priced at, above, or below such announced rate. Any change in
such rate announced by Bank of America shall take effect at the opening
of business on the day specified in the public announcement of such
change.

Amendment of Paragraph 5.2. Paragraph 5.2 in ARTICLE V of the Financing

Agreement is amended and restated in its entirety as follows:

               5.2 Loans and Letters of Credit Under Facility. As a condition to
each Loan and Letter of Credit under the Facility, each of the following
requirements must be satisfied in Agent’s discretion: (a) Borrower shall
be current with respect to the delivery of Borrowing Base Reports and all
items as required under paragraph 5.1, and the Borrowing Base must be
confirmed by Agent, (b) the amount of Loans or Letter of Credit requested
does not exceed the Availability as of the date of such Loans or Letter
of Credit, (c) all representations and warranties contained in Article VI
shall be true, correct and complete in all material respects except as
supplemented pursuant to paragraph 7.12, and (d) no Default or Event of
Default shall have occurred and be continuing, or shall result from such
Loans or Letter of Credit, and no other event or condition which is
reasonably expected to result in a Material Adverse Effect shall be in
existence. Any request for Loans or a Letter of Credit under the
Facility at a time when any of the foregoing requirements is not
satisfied may be declined by Agent without prior notice.

Amendment of Paragraph 6.19. Paragraph 6.19 in ARTICLE VI of the Financing

Agreement is amended and restated in its entirety as follows:

               6.19 Solvency. (i) the fair saleable value of all assets of
Borrower and its Subsidiaries exceeds the amount of all of Borrower’s and
its Subsidiaries’ existing debts and liabilities (including contingent
liabilities), (ii) the assets of Borrower and its Subsidiaries do not
constitute an unreasonably small capital for the operation of Borrower’s
and its Subsidiaries’ business as now conducted and as intended to be
conducted, taking into account all known or projected capital
requirements for such operations, (iii) neither Borrower nor any of its
Subsidiaries intend to incur debts beyond their respective ability to pay
as they mature, and (iv) Borrower’s and its Subsidiaries’ consolidated
cash flow is sufficient to pay all existing debts and liabilities as they
become due.

 

 

Amendment of Paragraph 7.4. Paragraph 7.4 in ARTICLE VII of the Financing

Agreement is amended and restated in its entirety as follows:

               7.4 Existence. Borrower and each Guarantor shall preserve and
maintain its partnership or corporate existence, as appropriate, and
shall maintain its good standing and authority to transact business in
all jurisdictions where necessary for the proper conduct of its business,
and Borrower and each Guarantor shall maintain all of its properties,
rights, privileges and franchises necessary or desirable in the normal
conduct of its business.

Amendment of Paragraph 7.8. Paragraph 7.8 in ARTICLE VII of the Financing

Agreement is amended by amending the first sentence thereof to read as follows:

          No later than the thirtieth (30th) day after the last day of each
calendar quarter, and at such other times as Agent may request, Borrower
shall execute and deliver to Agent, in form satisfactory to Agent and
Borrower, a Borrowing Base Report setting forth a certification of
Eligible Accounts and Eligible Inventory as of the last day of such
calendar quarter and such other date as may be specified in such other
Borrowing Base Reports Borrower may deliver to Agent, and calculation of
the Borrowing Base. Each Borrowing Base Report shall include a
reconciliation of the calculation of the Borrowing Base as certified in
the most recent Borrowing Base Report delivered to Agent, and be
accompanied by such documents and supporting information relating to
Eligible Accounts and Eligible Inventory as Agent may request.

Amendment of Paragraph 7.14. Paragraph 7.14 in ARTICLE VII of the Financing

Agreement is amended and restated in its entirety as follows:

               7.14 Payment of Taxes. Borrower and each Guarantor shall promptly
pay, or cause to be paid, when due, any and all taxes except such taxes
as may be contested in good faith by appropriate proceedings, provided,
that adequate reserves shall be maintained as are appropriate according
to GAAP. At Agent’s request pending resolution of any such contest and
prior to the delinquency of such tax, Borrower and each Guarantor, as the
case may be, shall furnish to Agent a cash reserve in the amount of the
tax, together with a reasonable additional sum to pay all projected
costs, interest and penalties in connection therewith, conditioned that
such tax, together with the applicable interest, cost, and penalties, if
any, be timely paid to the extent required upon resolution of such
contest. Borrower agrees that it shall immediately notify Agent of the
initiation of any such contest and advise Agent from time to time of the
status thereof. Borrower and each Guarantor shall promptly pay any
amounts adjudged to be due pursuant to any such contest, with all costs,
penalties, and interest thereon, before such judgment becomes final or
any writ or order is issued under which Borrower’s or such Guarantor’s
property, or any portion thereof, may become subject to any lien or
encumbrance.

Amendment of Paragraph 7.15. Paragraph 7.15 in ARTICLE VII of the Financing

Agreement is amended and restated in its entirety as follows:

               7.15 Compliance with Laws. Borrower and each Guarantor shall comply
with all applicable laws, regulations and orders applicable to it or its
property, a violation of which would reasonably be expected to result in
a Material Adverse Effect. At Agent’s request, Borrower will provide
Agent with evidence of Borrower’s or any Guarantor’s compliance with
Environmental Requirements.

Amendment of Paragraph 7.21. Paragraph 7.21 in ARTICLE VII of the Financing

Agreement is amended and restated in its entirety as follows:

               (a) Borrower agrees that the following financial covenants must be
maintained as set forth herein. Borrower’s compliance shall be measured
as of the end of each Fiscal Quarter, unless the context provides
otherwise.

	1.	 	Fixed Charge Ratio. Fixed Charge
Ratio shall not at any time be less than 3.50 to 1.00.

	2.	 	Leverage Ratio. Leverage Ratio shall
not at any time be more than (a) from December 31, 2003,
through and including June 30, 2004, 3.50 to 1.0, and
(b) thereafter, 3.00 to 1.0.

 

 

	3.	 	Capital Expenditures. Capital
Expenditures shall not exceed (a) $7,500,000 during
fiscal year 2003, (b) $25,000,000 during fiscal year
2004, (c) $20,000,000 during fiscal year 2005 and (d)
$15,000,000 during any fiscal year thereafter.

               (b) For purposes of measuring the financial covenants under this
paragraph, the following definitions shall apply, each determined on a
consolidated basis for Borrower and the Subsidiaries according to GAAP.

	1.	 	“Capital Expenditures” means all
expenditures which are classified as capital
expenditures according to GAAP.
	 
	2.	 	“Cash Taxes” means, for any period,
all federal, state, local and foreign income taxes paid
in cash during such period.
	 
	3.	 	“Current Maturities of Long-Term
Indebtedness” means, for any period, the scheduled
principal payments during such period in respect of
indebtedness having a final maturity date of more than
one year (excluding indebtedness under the Facility).
	 
	4.	 	“EBITDA” means an amount equal to the
sum of the following, determined for the preceding four
(4) completed Fiscal Quarters: (i) income before
provision for income taxes plus (ii) all interest
charges paid or accrued plus (iii) depreciation and
amortization.
	 
	5.	 	“Fixed Charge Ratio” means the ratio
of the following, determined for the preceding four (4)
Fiscal Quarters: (a) the sum of EBITDA less Cash Taxes
less Maintenance Capital Expenditures, (b) divided by
the sum of Interest Expense plus Current Maturities of
Long-Term Indebtedness plus cash dividends paid by the
Parent to its shareholders.
	 
	6.	 	“Funded Debt” at any time means an
amount equal to the aggregate principal amount
outstanding at such time under the Facility.
	 
	7.	 	“Interest Expense” means all interest
charges paid or assumed, excluding capitalized interest,
if any.
	 
	8.	 	“Leverage Ratio” means the ratio of
the following: (a) Funded Debt as of the end of a
Fiscal Quarter, (b) divided by EBITDA for the preceding
four (4) Fiscal Quarters ending with such Fiscal
Quarter.
	 
	9.	 	“Maintenance Capital Expenditures”
means, for any period of four (4) Fiscal Quarters, an
amount equal to $6,000,000.

Amendment of Paragraph 7.22. Paragraph 7.22 in ARTICLE VII of the Financing

Agreement is amended by amending the first sentence thereof to read as follows:

          Borrower and each Guarantor covenants and agrees that (i) it will not
grant, or suffer to exist, any security interest, lien or other
encumbrance on any of its assets other than liens with respect to
indebtedness permitted by paragraph 7.26(c) and Permitted Encumbrances
and (ii) all such assets shall at all times be and remain free and clear
of security interests, liens or other encumbrances other than Permitted
Encumbrances.

Amendment of Paragraph 7.26. Paragraph 7.26 in ARTICLE VII of the Financing

Agreement is hereby amended and restated in its entirety as follows:

               7.26 Limitation on Indebtedness. Neither Borrower nor any Guarantor
will be obligated, directly or indirectly, for borrowed money or
otherwise under any promissory note, bond, indenture or similar
instrument, other than (a) in favor of Agent and the Lenders hereunder,
(b) trade indebtedness incurred in the normal and ordinary course of
Borrower’s or such Guarantor’s business and not more

 

 

          than ninety (90) days past due, (c)(i) indebtedness of Borrower or
any Guarantor under capitalized leases and (ii) purchase money
indebtedness in connection with the purchase of equipment, if the
payments required in respect of such capitalized leases and purchase
money indebtedness do not exceed $2,100,000.00 in the aggregate during
any 12-month period, and (d) loans from Borrower to any of the Parent,
EWC LP or EWC GP, the proceeds of which shall be used solely for
reasonable operating expenses of Parent, EWC LP or EWC GP incurred in the
ordinary course of business, provided, however, that the aggregate
principal amount of such loans from Borrower to Parent, EWC LP or EWC GP
shall at no time during any fiscal year exceed an amount equal to the
difference between $2,000,000 and the dividends permitted and actually
paid during such fiscal year under paragraph 7.30(a).

Amendment of Paragraph 7.27. Paragraph 7.27 in ARTICLE VII of the Financing

Agreement is amended and restated in its entirety as follows:

               7.27 Limitation on Contingent Liabilities. Neither Borrower nor any
Guarantor will be directly or indirectly liable in connection with the
obligations of any Person, whether by guarantee, surety, endorsement
(other than endorsement of negotiable instruments for collection in the
ordinary course of business), agreement to purchase or repurchase,
agreement to make investments, agreement to provide funds or maintain
working capital, or any agreement to assure a credit against loss, other
than (a) those in favor of Agent and the Lenders hereunder, and (b)
indemnities by Borrower or any Guarantor of liabilities of directors and
officers pursuant to provisions contained in Borrower’s partnership
agreement or any Guarantor’s governance documents or otherwise permitted
by applicable law and other contractual indemnities (such as contractual
indemnifications in favor of customers) typically entered into in the
normal course of business or in the course of the issuance and sale of
securities.

Amendment of Paragraph 7.30. Paragraph 7.30 in ARTICLE VII of the Financing

Agreement is hereby amended and restated in its entirety as follows:

               7.30 Dividends, Distributions. Borrower will not declare, pay or
issue any dividends or other distributions in respect of its partnership
interests, or distribute, reserve, secure or otherwise commit
distributions in respect thereof, provided, however, that if no Default
or Event of Default exists or will result therefrom Borrower may make
distributions to its shareholders (a) in the aggregate amount equal to or
less than $2,000,000 per fiscal year, the proceeds of which shall be used
solely for reasonable operating expenses of Parent, EWC LP and EWC GP
incurred in the ordinary course of business or to repay intercompany
loans permitted under paragraph 7.26(d), and (b) in addition to the
distributions permitted under clause (a) of this paragraph, in an
aggregate amount during any period of four (4) Fiscal Quarters not to
exceed 25% of net income of Borrower during such period, it being agreed
that such distributions shall be made to either EWC GP or EWC LP who
shall then distribute such distributions to Parent, provided, further,
that the proceeds of the distributions permitted under clause (b) above
shall be used solely for dividends to the shareholders of the Parent
and/or for repurchasing shares of Parent to be held as treasury shares.

Amendment of Paragraph 7.33. Paragraph 7.33 in ARTICLE VII of the Financing

Agreement is hereby amended and restated in its entirety as follows:

               7.33 Loans to Employees. Except for usual and customary extensions
of credit to customers of Borrower made in the ordinary course of its
business, Borrower will not make any loans or advances to or for the
benefit of any employee or any officer, director or shareholder of
Borrower or its corporate general partner or any other Guarantor other
than (i) usual expense allowances for employees in the ordinary course of
business, and (ii) loans to employees (who are not executive officers or
the equivalent or directors) in excess of an aggregate amount of $200,000
at any one time outstanding.

Amendment of Paragraph 8.1(d). Paragraph 8.1(d) in ARTICLE VIII of the

Financing Agreement is amended and restated in its entirety as follows:

               (d) The filing of any petition or proceeding by or against Borrower
or any Guarantor under the United States Bankruptcy Code, as amended from
time to time, or any other applicable state or federal law relating to
bankruptcy reorganization or other relief for debtors, or the appointment
of a conservator, receiver, trustee, or liquidator of all or a
substantial part of the assets of Borrower or any Guarantor; provided
that if any such petition, proceeding or appointment is filed or made
without the

 

 

          consent of Borrower or any Guarantor, an Event of Default shall not
occur unless such petition, proceeding or appointment shall continue
undismissed or unstayed for a period of sixty (60) consecutive calendar
days;

Amendment of Paragraph 8.1(h). Paragraph 8.1(h) in ARTICLE VIII of the

Financing Agreement is amended and restated in its entirety as follows:

               (h) (i) Any breach or default in the payment or performance of any
material obligation, or any defined event of default, under the terms,
provisions or conditions of any contract or instrument pursuant to which
Borrower or any Guarantor has incurred any indebtedness or obligation or
other liability to any Person, the effect of which is to have caused, or
to create an enforceable right to cause, indebtedness in a principal
amount in excess of $100,000.00 to be declared to be due and payable
prior to stated maturity; or (ii) any other event occurs with respect to
indebtedness of Borrower or any Guarantor in a principal amount in excess
of $100,000.00, the effect of which is to cause, or create an enforceable
right to cause, such indebtedness to be demanded or to become due or to
be repurchased, prepaid, defeased or redeemed or an offer to repurchase,
prepay, defease or redeem to be made, prior to its stated maturity.

Amendment of Paragraph 8.1(i). Paragraph 8.1(i) in ARTICLE VIII of the

Financing Agreement is amended and restated in its entirety as follows:

               (i) Borrower fails to have discharged within a period of thirty (30)
days after the signing or entry of any judgment against Borrower or any
Guarantor in an amount equal to or exceeding $500,000.00;

Amendment of Paragraph 8.1(j). Paragraph 8.1(j) in ARTICLE VIII of the Financing Agreement is

amended and restated in its entirety as follows:

               (j) The dissolution or liquidation of Borrower or any Guarantor, or
the taking of any action by the board of directors, shareholders or any
partner of Borrower or any Guarantor to dissolve or liquidate;

Amendment of Paragraph 9.2. Paragraph 9.2 in ARTICLE IX of the Financing

Agreement is amended and restated in its entirety as follows:

               9.2 Remedies. Should an Event of Default occur at any time, Agent
may at its option, and shall if directed by all the Required Lenders,
terminate the Commitments upon written notice to Borrower and/or declare
the entire outstanding principal amount and unpaid accrued interest of
any part of the Obligations to be immediately due and payable and, in
addition, may exercise and avail itself of any and all other remedies as
may be available under the Loan Documents or as otherwise may be
available according to law; provided, however, upon the occurrence of an
Event of Default under paragraph 8.1(d), the Commitments shall
automatically terminate and the entire outstanding principal amount and
unpaid accrued interest of any part of the Obligations shall
automatically become due and payable, without further action by Agent or
any Lender.

Amendment of Paragraph 10.1. Paragraph 10.1 in ARTICLE X of the Financing

Agreement is amended by adding the following sentence to the end thereof to

read as follows:

          Without limiting the generality of the foregoing, the use of the term
“agent” herein and in the other Loan Documents with references to Agent
is not intended to connote any fiduciary or other implied (or express)
obligations arising under agency doctrine of any applicable law.

Amendment of ARTICLE X. ARTICLE X of the Financing Agreement is amended by

adding a new paragraph 10.8 thereto to read as follows:

               10.8 Co-Syndication Agent. None of the Lenders identified herein as
a “Co-Syndication Agent” shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than, in the
case of such Lenders, those applicable to all Lenders as such. Without
limiting the foregoing, none of the Co-Syndication Agents shall have or
be deemed to have any fiduciary relationship with any Lender.

 

 

Amendment of Paragraph 11.3. Paragraph 11.3 in ARTICLE XI of the Financing

Agreement is amended and restated in its entirety as follows:

               11.3 Use of Proceeds. No portion of the proceeds of any Loans or
Letters of Credit under the Facility shall be used to purchase or carry
any “margin stock” as defined under Regulation “U” of the Board of
Governors of the Federal Reserve System, or to repay or refinance any
debt previously incurred by Borrower for such purpose.

Amendment of Paragraph 11.9(b). Paragraph 11.9(b) in ARTICLE XI of the

Financing Agreement is amended and restated in its entirety as follows:

               (b) Each of the Loan Parties and each of the Lenders agree that any
Lender (the “Assigning Lender”) may at any time assign to one or more
Eligible Assignees all, or a proportionate part of all, of its rights and
obligations under this Agreement and the other Loan Documents (including,
without limitation, its Commitments and Loans) (each an “Assignee”);
provided, however, that (i) each such assignment may be of a varying
percentage of the Assigning Lender’s rights and obligations under this
Agreement and the other Loan Documents and may relate to some but not all
of such rights and/or obligations, (ii) except in the case of an
assignment of all of a Lender’s rights and obligations under this
Agreement and the other Loan Documents, the amount of the Commitment and
Loans of the Assigning Lender being assigned pursuant to each assignment
(determined s of the date of the Assignment and Acceptance with respect
to such assignment) shall in no event be less than $5,000,000, and (iii)
the parties to each such assignment shall execute and deliver to Agent
for its acceptance and recording in the Register (as defined below), an
Assignment and Acceptance, together with the Revolving Note subject to
such assignment, and a processing and recordation fee of $2,500 (provided
no processing and recordation fee shall be payable for assignments made
between Affiliates). Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be at least five (5) Business
Days after the execution thereof or such other date as may be approved by
Agent, (1) the Assignee thereunder shall be a party hereto as a “Lender”
and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the
rights and obligations of a Lender hereunder and under the Loan
Documents, and (2) the Assigning Lender thereunder shall, to the extent
that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released
from its obligations under this Agreement and the other Loan Documents
(and, in the case of an Assignment and Acceptance covering all or the
remaining portion of a Lender’s rights and obligations under the Loan
Documents, such Lender shall cease to be a party thereto, provided that
such Lender’s rights under paragraph 3.1.4, paragraph 11.5 and paragraph
11.11 accrued through the date of assignment shall continue).

Amendment of ARTICLE XI. ARTICLE XI of the Financing Agreement is amended by

adding a new Paragraph 11.29 thereto to read as follows:

               11.29 USA Patriot Act Notice. Each Lender and Agent (for itself and
not on behalf of any Lender) hereby notifies Borrower that pursuant to
the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2003)) (the “Act”), it is required to
obtain, verify and record information that identifies Borrower, which
information includes the name and address of Borrower and other
information that will allow such Lender or the Agent, as applicable, to
identify Borrower in accordance with the Act.

Representations and Warranties True; No Event of Default. By its execution and

delivery hereof, Borrower represents and warrants that, as of the date hereof:

the representations and warranties contained in the Financing Agreement and the

other Loan Documents are true and correct on and as of the date hereof as made

on and as of such date;

no event has occurred and is continuing which constitutes a Default or an Event

of Default;

(i) Borrower has full power and authority to execute and deliver this Fifth

Amendment, the Revolving Note payable to the order of each New Lender

(collectively, the “New Notes”) and the replacement Revolving Note payable to

the order of each Lender whose Commitment has been amended pursuant to this

Fifth Amendment (collectively, the “Replacement Notes”), (ii) this Fifth

Amendment, the New Notes and the Replacement Notes have been duly executed and

delivered by Borrower, and (iii) this Fifth Amendment, the New Notes, and the

Replacement Notes and the Financing Agreement, as amended hereby, constitute

the legal, valid and binding obligations of Borrower, enforceable in accordance

with their respective terms, except as enforceability may be limited by

applicable debtor

 

 

relief laws and by general principals of equity (regardless of whether

enforcement is sought in a proceeding in equity or at law) and except as rights

to indemnity may be limited by federal or state securities laws;

neither the execution, delivery and performance of this Fifth Amendment, the

New Notes, the Replacement Notes, or the Financing Agreement, as amended

hereby, nor the consummation of any transactions contemplated herein or

therein, will conflict with any law or any articles of incorporation, bylaws or

other governing documents of Borrower or any Guarantor, or any indenture,

agreement or other instrument to which Borrower or any Guarantor or any of

their respective properties are subject;

and

no authorization, approval, consent, or other action by, notice to, or filing

with, any governmental authority or other Person not previously obtained is

required for (i) the execution, delivery or performance by Borrower of this

Fifth Amendment, the New Notes or the Replacement Notes or (ii) the

acknowledgment by each Guarantor of this Fifth Amendment.

Conditions to Effectiveness. This Fifth Amendment shall be effective (and the

Applicable Margins set forth in Section 18 of this Fifth Amendment will go into

effect notwithstanding anything in the last paragraph thereof to the contrary)

upon satisfaction or completion of the following:

Agent shall have received counterparts of this Fifth Amendment executed by all

Lenders; Agent shall have received counterparts of this Fifth Amendment executed by

Borrower and acknowledged by each Guarantor;

Agent shall have received a certified resolution of the Board of Directors of

Borrower authorizing the execution, delivery and performance of this Fifth

Amendment, the New Notes and the Replacement Notes;

Agent shall have received an opinion of Borrower’s counsel, in form and

substance satisfactory to Agent, with respect to matters set forth in Section

45(c), (d) and (e) of this Fifth Amendment;

Agent shall have received a duly executed (i) New Note for each New Lender and

(ii) Replacement Note for each Lender whose Commitment is being amended by this

Fifth Amendment;

Agent shall have received an amendment to the Guaranty executed by the Parent,

in form and substance satisfactory to the Agent;

Agent shall have received from Borrower in immediately available funds for (i)

each Lender whose original commitment amount as set forth in such Lender’s

commitment letter to Agent with respect to this Fifth Amendment was less than

$25,000,000, an amount equal to the product of (A) 0.125% and (B) the amount of

each such Lender’s Commitment (after giving effect to this Fifth Amendment),

and (ii) for each Lender whose original commitment amount as set forth in such

Lender’s commitment letter to Agent with respect to this Fifth Amendment was

equal to or greater than $25,000,000, an amount equal to the product of (A)

0.175% and (B) the amount of each such Lender’s Commitment (after giving effect

to this Fifth Amendment); Agent shall have received from Borrower in immediately available funds all

other fees and amounts due and payable pursuant to that certain letter, dated

November 25, 2003, among Borrower, Agent and Banc of America Securities LLC;

Agent shall have received from Borrower a Borrowing Base Report setting forth a

certification of Eligible Accounts and Eligible Inventory as of December 31,

2003; and Agent shall have received, in form and substance satisfactory to Agent and its

counsel, such other documents, certificates and instruments as Agent shall

require.

Payments by Lenders. Upon the effectiveness of this Fifth Amendment, each

Lender shall, to the extent necessary, make a payment to Agent in an am
ount

sufficient, upon the application of such payments by all Lenders to the

reduction of outstanding Loans held by Lenders, to cause the principal amount

of Loans outstanding made by each Lender to be in the amount of its pro rata

share (after giving effect to this Fifth Amendment) of all outstanding Loans.

Borrower hereby irrevocably authorizes each Lender to fund to Agent the payment

required to be made pursuant to the immediately preceding sentence for

application to the reduction of the outstanding Loans held by other Lenders.

If, as a result of the repayment of Loans provided for in this Section 47, any

payment of LIBOR Based Loans occurs on a day which is not the last day of the

applicable Interest Period, Borrower will pay to Agent for the benefit of any

Lender holding a LIBOR Based Loan any Lender’s Consequential Loss incurred by

such Lender resulting therefrom in accordance with paragraph 3.1.4 to the

extent a LIBOR Based Loan is paid on other than the last day of an Interest

Period as a result thereof. Upon the effective date of this Fifth Amendment,

each New Lender and each Lender whose Commitment is increased as a result of

this Fifth Amendment, shall be deemed to have irrevocably and unconditionally

purchased and received, without recourse or warranty, an undivided

participation in all outstanding

 

 

Letter of Credit Liabilities in accordance with its pro rata share (after

giving effect to this Fifth Amendment).

Addition of New Lenders. The parties hereto agree that the provisions of

paragraph 11.9 of the Financing Agreement shall not be applicable to the

addition of the New Lenders pursuant to this Fifth Amendment. Each New Lender

represents, warrants and acknowledges to Agent as follows:

such New Lender confirms that is has received a copy of the Financing Agreement

and all amendments thereto, together with copies of the financial statements

and other information referred to in paragraphs 7.5 and 7.6 of the Financing

Agreement and such other documents and information as it has deemed appropriate

to make its own credit analysis and decision to enter into this Fifth

Amendment;

such New Lender will, independently and without reliance upon Agent or any

Lender and based on such documents and information as it shall deem appropriate

at the time, continue to make its own credit decisions in taking or not taking

action under the Financing Agreement and the other Loan Documents;

such New Lender confirms that it is an Eligible Assignee;

such New Lender appoints and authorizes Agent to take such action as agent on

its behalf and exercise such powers under the Loan Documents as are delegated

to Agent by the terms thereof, together with such powers as are reasonably

incidental thereto;

such New Lender agrees that it will perform in accordance with their terms all

of the obligations which by the terms of the Loan Documents are required to be

performed by it as a Lender;

neither Agent nor any Lender has made any representation or warranty or accrued

any responsibility with respect to any statements, warranties or

representations made in or in connection with this Fifth Amendment or any of

the Loan Documents or the execution, legality, validity, enforceability or

genuineness, sufficiency or value of this Fifth Amendment or any of the Loan

Documents or any other instrument or document furnished pursuant hereto or

thereto; and

neither Agent nor any Lender has made any representation or warranty or assumed

any responsibility with respect to the financial condition or results of

operations of any Loan Party or the performance or observance by any Loan Party

of its obligations under this Fifth Amendment or under the Loan Documents.

Reference to the Financing Agreement.

Upon the effectiveness of this Fifth Amendment, each reference in the Financing

Agreement to “this Agreement”, “hereunder”, or words of like import shall mean

and be a reference to the Financing Agreement, as affected and amended hereby.

The Financing Agreement, as amended by the amendments referred to above, and

the other Loan Documents shall remain in full force and effect and is hereby

ratified and confirmed.

Further Assurances. Borrower shall execute and deliver such further

agreements, documents, instruments, and certificates in form and substance

satisfactory to Agent, as Agent or any Lender may deem necessary or appropriate

in connection with this Fifth Amendment.

No Waiver. Nothing contained in this Fifth Amendment shall be construed as a

waiver by Agent or Lenders of any covenants or provisions of the Financing

Agreement, the other Loan Documents, this Fifth Amendment, or of any other

contract or instrument between Borrower, Agent and/or Lenders, and the failure

of Agent or Lenders at any time or times hereafter to require strict

performance by Borrower of any provisions thereof shall not waive, affect or

diminish any right of Agent or Lenders to thereafter demand strict compliance

therewith. Agent and Lenders hereby reserve all rights granted under the

Financing Agreement, and the other Loan Documents, this Fifth Amendment and an
y

other contract or instrument between Borrower, Agent and/or Lenders.

Costs, Expenses and Taxes. Borrower agrees to pay on demand all costs and

expenses of Agent in connection with the preparation, reproduction, execution

and delivery of this Fifth Amendment and the other instruments and documents to

be delivered hereunder (including the reasonable fees and out-of-pocket

expenses of counsel for Agent with respect thereto).

Guarantor’s Acknowledgment. By signing below, each Guarantor (a) acknowledges,

consents and agrees to the execution, delivery and performance by Borrower of

this Fifth Amendment, (b) acknowledges and agrees that its obligations in

respect of its Guaranty (i) are not released, diminished, waived, modified,

impaired or affected in any manner by this Fifth Amendment or any of the

provisions contemplated herein and (ii) cover the Commitments as increased by

this Fifth Amendment, (c) ratifies and confirms its obligations under its

Guaranty, and (d) acknowledges and agrees that it has no claims or offsets

against, or defenses or counterclaims to, its Guaranty.

Execution in Counterparts. This Fifth 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 when taken together shall

constitute but one and the same instrument. For purposes of this Fifth

Amendment, a counterpart hereof (or signature page thereto) signed and

transmitted by any Person party hereto to Agent (or its counsel) by facsimile

machine, telecopies or electronic mail is to be treated as an original. The

signature of such Person thereon, for purposes hereof, is to be considered as

an original signature, and the counterpart (or signature page thereto) so

transmitted is to be considered to have the same binding effect as an original

signature on an original document.

Governing Law; Binding Effect. This Fifth Amendment shall be governed by and

construed in accordance with the laws of the State of Texas applicable to

agreements made and to be performed entirely within such state, provided that

each party shall retain all rights arising under federal law, and shall be

binding upon the parties hereto and their respective successors and assigns.

Headings. Section headings in this Fifth Amendment are included herein for

convenience of reference only and shall not constitute a part of this Fifth

Amendment for any other purpose.

Entire Agreement. THE FINANCING AGREEMENT, AS AMENDED BY THIS FIFTH AMENDMENT,

AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES

AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT

ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN AGREEMENTS AMONG THE

PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

Waiver of Trial by Jury. THE PARTIES HERETO AGREE THAT NO PARTY HERETO SHALL

REQUEST A TRIAL BY JURY IN THE EVENT OF LITIGATION BETWEEN OR AMONG THEM

CONCERNING THIS FIFTH AMENDMENT OR ANY OTHER LOAN DOCUMENTS OR ANY CLAIMS OR

TRANSACTIONS IN CONNECTION THEREWITH, IN EITHER A STATE OR FEDERAL COURT, THE

RIGHT TO TRIAL BY JURY BEING EXPRESSLY WAIVED BY ALL PARTIES HERETO. AGENT,

EACH LENDER AND BORROWER ACKNOWLEDGES THAT SUCH WAIVER IS MADE WITH FULL

KNOWLEDGE AND UNDERSTANDING OF THE NATURE OF THE RIGHTS AND BENEFITS WAIVED

HEREBY, AND WITH THE BENEFIT OF ADVICE OF COUNSEL OF ITS CHOOSING.

REMAINDER OF PAGE LEFT INTENTIONALLY BLANK

 

 

     IN WITNESS WHEREOF, the parties have caused this Fifth Amendment to be
executed by their respective duly authorized officers as of the date first
written above.

	 	 	 	 	 
	 	 	BORROWER:
	 	 	 	 	 
	 	 	ENCORE WIRE LIMITED
	 	 	 	 	 
	 	 	By: EWC GP Corp., its general partner
	 	 	 	 	 
	 	 	
By:
	 	/s/ Daniel L. Jones
	 	 	 	 	

	 	 	 	 	Daniel L. Jones, President

 

 

	 	 	 	 	 	 	 
	 	 	LENDERS AND AGENT:
	 	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as Agent
	 	 	 	 	 	 	 
	 	 	
By:	 	/s/
Authorized Signatory
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	 	 	

	 	 	 	 	Title:	 	 
	 	 	 	 	 	 	

	 	 	BANK OF AMERICA, N.A., as a Lender
	Commitment: $38,000,000	 	 	 	 	 	 
	 	 	By:	 	/s/ Steven Mackenzie
	 	 	 	 	

	 	 	 	 	Steven Mackenzie
	 	 	 	 	Vice President

 

 

	 	 	 	 	 	 	 
	 	 	BANK ONE, NA, as Co-Syndication Agent and as a Lender
	Commitment: $20,500,000	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
By:	 	/s/ Authorized
Signatory
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	 	 	

	 	 	 	 	Title:	 	 
	 	 	 	 	 	 	

 

 

	 	 	 	 	 	 	 
	 	 	GUARANTY BANK, as Co-Syndication Agent and as a
	 	 	Lender
	 	 	 	 	 	 	 
	Commitment:$20,500,000	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
By:	 	/s/ Authorized
Signatory
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	 	 	

	 	 	 	 	Title:	 	 
	 	 	 	 	 	 	

 

 

	 	 	 	 	 	 	 
	 	 	WELLS FARGO BANK, N.A., as Co-Syndication Agent
	 	 	and as a Lender
	 	 	 	 	 	 	 
	Commitment: $20,500,000	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
By:	 	/s/ Authorized
Signatory
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	 	 	

	 	 	 	 	Title:	 	 
	 	 	 	 	 	 	

 

 

	 	 	 	 	 	 	 
	 	 	COMERICA BANK, as a Lender
	 	 	 	 	 	 	 
	Commitment:$12,750,000	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
By:	 	/s/ Authorized
Signatory
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	 	 	

	 	 	 	 	Title:	 	 
	 	 	 	 	 	 	

 

 

	 	 	 	 	 	 	 
	 	 	HIBERNIA NATIONAL BANK, as a Lender
	 	 	 	 	 	 	 
	Commitment:$12,750,000	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
By:	 	/s/ Authorized
Signatory
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	 	 	

	 	 	 	 	Title:	 	 
	 	 	 	 	 	 	

 

 

ACKNOWLEDGED AND

AGREED:

	 	 	 	 	 
	 	 	EWC GP CORP.
	 	 	 	 	 
	 	 	
By:
	 	/s/ Daniel L. Jones
	 	 	 	 	

	 	 	 	 	Daniel L. Jones, President
	 	 	 	 	 
	 	 	EWC AVIATION, INC.
	 	 	 	 	 
	 	 	
By:
	 	/s/ Daniel L. Jones
	 	 	 	 	

	 	 	 	 	Daniel L. Jones, President
	 	 	 	 	 
	 	 	ENCORE WIRE CORPORATION
	 	 	 	 	 
	 	 	
By:
	 	/s/ Daniel L. Jones
	 	 	 	 	

	 	 	 	 	Daniel L. Jones, President
	 	 	 	 	 
	 	 	EWC LP CORP.
	 	 	 	 	 
	 	 	
By:
	 	/s/ Christopher J. Monigle
	 	 	 	 	

	 	 	 	 	Christopher J. Monigle, Vice President<PAGE>

                                                                    EXHIBIT 10.5

                       FIRST AMENDMENT TO CREDIT AGREEMENT

         This First Amendment to Credit Agreement (this "FIRST AMENDMENT") is
executed as of October 31, 2002 (the "EFFECTIVE DATE"), by and among Encore
Acquisition Company, a Delaware corporation ("BORROWER"), Encore Operating,
L.P., a Texas limited partnership ("OPERATING"), Fleet National Bank, a national
banking association, as Administrative Agent ("ADMINISTRATIVE AGENT"), and the
financial institutions a party hereto as Banks ("BANKS").

                                   WITNESSETH:

         WHEREAS, Borrower, Operating, Administrative Agent, the other Agents a
party thereto and Banks are parties to that certain Credit Agreement dated as of
June 25, 2002 (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, Banks have made a revolving
credit loan to Borrower; and

         WHEREAS, Borrower and Operating have requested that Banks (a) amend
certain terms of the Credit Agreement in certain respects, and (b) reaffirm the
Borrowing Base of $220,000,000 to be effective as of December 1, 2002 and
continuing until the first Redetermination thereafter; and

         WHEREAS, subject to the terms and conditions set forth herein, Banks
have agreed to Borrower's and Operating'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, Operating, Administrative Agent and each Bank hereby agree as follows:

         SECTION 1. AMENDMENTS. In reliance on the representations, warranties,
covenants and agreements contained in this First Amendment, and subject to the
satisfaction of the conditions precedent set forth in Section 3 hereof, the
Credit Agreement is hereby amended effective as of the Effective Date in the
manner provided in this Section 1.

         1.1.     AMENDMENT TO DEFINITIONS. The definitions of "LOAN PAPERS" and
"PERMITTED ENCUMBRANCES" contained in Section 1.1 of the Credit Agreement shall
be amended to read in full as follows:

                  "LOAN PAPERS" means this Agreement, the First Amendment, the
         Notes, the Mortgages, each Borrower Pledge Agreement, each Subsidiary
         Pledge Agreement, each Facility Guaranty, and all other certificates,
         documents or instruments delivered in connection with this Agreement,
         as the foregoing may be amended from time to time.

                  "PERMITTED ENCUMBRANCES" means with respect to any asset:

                                       1

<PAGE>

         (a)      Liens (if any) securing the Obligations (including, without
limitation, indebtedness, liabilities and obligations pursuant to any Hedge
Transaction entered into by a Credit Party with any Bank or any Affiliate of any
Bank);

         (b)      minor defects in title which do not secure the payment of
money and otherwise have no material adverse effect on the value or the
operation of the subject property, and for the purposes of this Agreement, a
minor defect in title shall include, but not be limited to, easements, zoning
restrictions, rights-of-way, servitudes, permits, surface leases and other
similar rights in respect of surface operations, and easements for pipelines,
streets, alleys, highways, telephone lines, power lines, railways and other
easements and rights-of-way, on, over or in respect of any of the properties of
any Credit Party that are customarily granted in the oil and gas industry;

         (c)      contractual or statutory Liens securing obligations for labor,
services, materials and supplies furnished to Mineral Interests and Liens
arising under joint operating agreements entered into in the ordinary course of
business, in each case securing obligations which are not delinquent (except to
the extent permitted by Section 9.7);

         (d)      contractual or statutory mechanic's, materialmen's,
warehouseman's, journeyman's and carrier's Liens and other similar Liens arising
in the ordinary course of business which are not delinquent (except to the
extent permitted by Section 9.7);

         (e)      Liens for Taxes or assessments not yet due or not yet
delinquent, or, if delinquent, that are not required to be paid subject to
satisfaction of the conditions set forth in Section 9.7;

         (f)      lease burdens payable to third parties which are deducted in
the calculation of discounted present value in the Reserve Report including,
without limitation, any royalty, overriding royalty, net profits interest,
production payment, carried interest or reversionary working interest;

         (g)      Liens encumbering assets securing Debt incurred to finance the
purchase of such assets, provided, that (i) the principal amount of the Debt
secured by a purchased asset shall not exceed one hundred percent (100%) of the
purchase price of such asset, (ii) such Liens shall not extend to or encumber
any other asset of any Credit Party, (iii) such Liens shall attach to such
purchased asset substantially simultaneously with the purchase of such asset,
and (iv) the aggregate amount of all Debt secured by such Liens shall not exceed
$15,000,000;

         (h)      Liens securing Hedge Transactions, including, without
limitation, pledges of cash or cash equivalents, provided, that, (i) such Hedge
Transactions comply with Section 10.11 to the extent applicable, and (ii) the
aggregate amount of cash or cash equivalents pledged (or the fair market value
of other, non-cash collateral pledged) shall not exceed $10,000,000 at any time;
and

         (i)      to the extent not included in clauses (a) through (h) above,
Permitted Encumbrances under and as defined in the Mortgages.

                                       2

<PAGE>

         1.2.     DEBT COVENANT. Section 10.1 of the Credit Agreement shall be
amended to read in full as follows:

         "Section 10.1 INCURRENCE OF DEBT. Borrower and Operating will not, nor
         will Borrower and/or Operating permit any other Credit Party to, incur,
         become or remain liable for any Debt other than (a) the Obligations
         (including, without limitation, Debt pursuant to any Hedge Transaction
         entered into by a Credit Party with a Bank or any Affiliate of any
         Bank), (b) the Permitted Subordinate Debt, (c) other Debt under Hedge
         Transactions, provided, that such Hedge Transactions comply with the
         terms and provisions of this Agreement, including, without limitation,
         Section 10.11, and (d) other Debt in an aggregate amount outstanding at
         any time not to exceed $15,000,000."

         1.3.     USE OF PROCEEDS COVENANTS. Section 10.7 of the Credit
Agreement shall be amended by deleting the last sentence thereof, and in lieu
thereof, substituting the following sentence:

         "Without limiting the foregoing, no Letter of Credit will be issued
         hereunder for the purpose of providing credit enhancement with respect
         to any Debt or equity security of any Credit Party, or to secure any
         Credit Party's obligations with respect to Hedge Transactions other
         than (i) Hedge Transactions with a Bank or an Affiliate of such Bank,
         or (ii) Hedge Transactions with a counterparty other than a Bank or an
         Affiliate of a Bank provided that such Hedge Transactions otherwise
         comply with the terms and provisions of this Agreement, including,
         without limitation, Section 10.1 and Section 10.11.

         SECTION 2. BORROWING BASE. The Borrowing Base shall continue to be
$220,000,000 from December 1, 2002 and continuing until the first
Redetermination thereafter. Borrower, Operating and Banks agree that the
Redetermination provided for in this Section 2 (a) shall be deemed to be the
Scheduled Redetermination to occur on December 1, 2002 pursuant to Section 5.2
of the Credit Agreement, and (b) shall not be construed or deemed to be a
Special Redetermination for purposes of Section 5.3 of the Credit Agreement.

         SECTION 3. CONDITIONS PRECEDENT. The effectiveness of the amendments to
the Credit Agreement contained in Section 1 hereof is subject to the
satisfaction of each of the following conditions precedent:

         3.1.     NO DEFAULT. No Default or Event of Default shall have occurred
which is continuing.

         3.2.     FEES. Borrower shall have paid to Administrative Agent any
fees payable to Administrative Agent or any Affiliate of Administrative Agent
pursuant to this First Amendment and any separate agreement among Borrower,
Operating, Administrative Agent or any Affiliate of Administrative Agent in
consideration for providing services in connection with the credit facilities
provided by the Credit Agreement.

         3.3.     OTHER DOCUMENTS. Administrative Agent shall have been provided
with such other documents, instruments and agreements, and Borrower and
Operating shall have taken such actions, as Administrative Agent may reasonably
require in connection with this First Amendment and the transactions
contemplated hereby.

                                       3
<PAGE>

         SECTION 4. REPRESENTATIONS AND WARRANTIES OF BORROWER AND OPERATING. TO
induce Banks and Administrative Agent to enter into this First Amendment,
Borrower and Operating hereby jointly and severally represent and warrant to
Banks and Administrative Agent as follows:

         4.1.     REAFFIRM EXISTING REPRESENTATIONS AND WARRANTIES. Each
representation and warranty of each Credit Party 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.

         4.2.     DUE AUTHORIZATION; NO CONFLICT. The execution, delivery and
performance by Borrower and Operating of this First Amendment are within
Borrower's and Operating's corporate and partnership powers (as applicable),
have been duly authorized by all 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, Operating or any other Credit Party or
result in the creation or imposition of any Lien upon any of the assets of any
Credit Party except Permitted Encumbrances.

         4.3.     VALIDITY AND ENFORCEABILITY; EXTENSION OF LIENS. This First
Amendment constitutes the valid and binding obligation of Borrower and Operating
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.

         4.4.     NO DEFAULT OR EVENT OF DEFAULT. No Default or Event of Default
has occurred which is continuing.

         SECTION 5. MISCELLANEOUS.

         5.1.     REAFFIRMATION OF LOAN PAPERS. 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. The amendments
contemplated hereby shall not limit or impair any Liens securing the
Obligations, each of which are hereby ratified, affirmed and extended to secure
the Obligations as they may be modified pursuant hereto.

         5.2.     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.

         5.3.     LEGAL EXPENSES. Borrower hereby agrees to pay on demand all
reasonable fees and expenses of counsel to Administrative Agent incurred by
Administrative Agent in connection with the preparation, negotiation and
execution of this First Amendment and all related documents.

         5.4.     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 Borrower, Operating and
Required Banks have executed a counterpart. Facsimiles shall be effective as
originals.

                                       4

<PAGE>

         5.5.     COMPLETE AGREEMENT. THIS FIRST AMENDMENT, THE CREDIT AGREEMENT
AND THE OTHER LOAN PAPERS REPRESENT THE FINAL AGREEMENT AMONG 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 OR AMONG THE
PARTIES.

         5.6.     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.

         5.7.     EFFECTIVENESS. This First Amendment shall be effective
automatically and without necessity of any further action by Borrower,
Operating, Administrative Agent or Banks when counterparts hereof have been
executed by Borrower, Operating and Required Banks, and all conditions to the
effectiveness hereof set forth herein have been satisfied.

         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.

                           [Signature pages to follow]

                                       5

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                         AND THE BANKS A PARTY THERETO

BORROWER:

ENCORE ACQUISITION COMPANY,
a Delaware corporation

By: /s/ MORRIS B SMITH
    --------------------------------
Name: MORRIS B  SMITH
Title: EJP - CFO

OPERATING:

ENCORE OPERATING, L.P.,
a Texas limited partnership

By: EAP Operating, Inc.,
    a Delaware corporation,
    its sole general partner

    By: /s/ MORRIS B SMITH
        -----------------------------------
    Name: MORRIS B SMITH
    Title: EJP - CFO

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
            FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
                                  BY AND AMONG
                              HYPERION ENERGY, LP,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                         AND THE BANKS A PARTY THERETO

ADMINISTRATIVE AGENT:

FLEET NATIONAL BANK,
as Administrative Agent

By: /s/ Jeffrey H. Rathkamp
    -------------------------------
    Jeffrey H. Rathkamp,
    Vice President

BANKS:

FLEET NATIONAL BANK,
as a Bank

BY: /s/ Jeffrey H. Rathkamp
   ------------------------------------
   Jeffrey H. Rathkamp,
   Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                          AND THE BANKS A PARTY THERETO

BANK:

WACHOVIA BANK, N.A.

By: /s/ David E. Humphreys
    -------------------------------
Name: David E. Humphreys
Title: Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                         AND THE BANKS A PARTY THERETO

BANK:

FORTIS CAPITAL CORP.

BY: /s/ David Montgomery
    -----------------------------------
NAME: David Montgomery
Title: Senior Vice President

By /s/ Darrell W. Holley
   ---------------------------------------
Name: Darrell W. Holley
Title: Managing Director

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                          AND THE BANKS A PARTY THERETO

BANK:

BNP PARIBAS

By: /s/ David Dodd
   ----------------------------
Name: David Dodd
Title: Director

By: /s/ Betsy Jocher
   -------------------------------
Name: Betsy Jocher
TITLE: Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                          AND THE BANKS A PARTY THERETO

BANK:

CREDIT SUISSE FIRST BOSTON,
CAYMAN ISLANDS BRANCH

By: /s/ James P. Moran
   -----------------------------------
Name: JAMES P. MORAN
Title: DIRECTOR

By: /s/ Ian W. Nalitt
   -------------------------------------
Name: IAN W. NALITT
Title: ASSOCIATE

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                         AND THE BANKS A PARTY THERETO

BANK:

THE FROST NATIONAL BANK

By: /s/ John S. Warren
   ------------------------------------
Name: John S. Warren
TITLE: Senior Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                         AND THE BANKS A PARTY THERETO

BANK:

UNION BANK OF CALIFORNIA, N.A.

By: /s/ Gary Shekerjian
    ------------------------------
Name: Gary Shekerjian
Title:   Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                          AND THE BANKS A PARTY THERETO

BANK:

COMERICA BANK - TEXAS

By: /s/ Michele Jones
    ----------------------------------
Name: Michele Jones
Title: Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                          AND THE BANKS A PARTY THERETO

BANK:

COMPASS BANK

By: /s/ Dorothy Marchand
   ------------------------------
Name: Dorothy Marchand
Title: Senior Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                         AND THE BANKS A PARTY THERETO

BANK:

SUNTRUST BANK

By: /s/ Ilene S. Fowler
    ----------------------------
Name: Ilene S. Fowler
Title:  Director

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                          AND THE BANKS A PARTY THERETO

BANK:

RZB FINANCE LLC

By: /s/ Pearl Geffers
    ---------------------------------
Name: PEARL GEFFERS
Title:  FIRST VICE PRESIDENT

By: /s/ John A. Valiska
   ----------------------------------
Name: John A. Valiska
Title: Group Vice President

                                [Signature Page]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT
                                  BY AND AMONG
                           ENCORE ACQUISITION COMPANY,
                             ENCORE OPERATING, L.P.,
                  FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
                         AND THE BANKS A PARTY THERETO

BANK:

BANK OF SCOTLAND

By: /s/ Joseph Fratus
    ----------------------------------
Name: JOSEPH FRATUS
TITLE: FIRST VICE PRESIDENT

                                [Signature Page]

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