Item 1.01 - Entry into a Material Definitive Agreement.
Amendment to Amended and Restated Credit Agreement.
On February 14, 2020, Carbon Appalachia Enterprises, LLC and Nytis Exploration
(USA) Inc. (collectively, the "Borrowers") (each of which is a subsidiary of
Carbon Energy Corporation ("Carbon" or the "Company"), a Delaware corporation),
entered into a Third Amendment (the "Amendment") of the Amended and Restated
Credit Agreement dated as of December 31, 2018, by and among the Borrowers,
Prosperity Bank (successor by merger to LegacyTexas Bank), as administrative
agent (the "Administrative Agent"), and the lenders from time to time party
thereto (as amended, the "Credit Agreement"). Pursuant to the Amendment,
Borrowers, the Administrative Agent and such lenders agreed to (i) amend certain
provisions of the Credit Agreement (described below) and (ii) the Administrative
Agent and such lenders provided limited waivers of noncompliance with certain
covenants under the Credit Agreement (also described below).
Pursuant to the Amendment, the parties agreed (i) that effective as of February
14, 2020, the Borrowing Base was reduced from $75 million to $73 million,
(ii) that the Borrowing Base would be automatically reduced by a further $1
million on each of February 28, 2020 and March 31, 2020 and by a further $2
million on each of April 30, 2020 and May 1, 2020, (iii) that, on or before
March 31, 2020 and the effective date of the Borrowing Base redetermination as
of May 1, 2020, the Borrowers will provide an annual Borrower-prepared operating
budget (or update) including an income statement, balance sheet, cash flow
statement and capital expenditure plan and thereafter provide such operating
budget within 90 days after the last day of the fiscal year for the fiscal year
during which such operating budget is due and (iv) deleted the requirement that
the Borrowers maintain a minimum Liquidity of $3 million. In connection with the
Amendment, the Administrative Agent and the lenders provided limited waivers of
the Borrower's noncompliance (xi) with the hedging requirement for the fiscal
quarter ended September 30, 2019 and (xii) with the asset sale covenant included
in the Second Amendment.
The above description of the terms of the Amendment does not purport to be
complete and is qualified in its entirety by the full text of the Amendment,
which is attached as an exhibit hereto and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits:
Exhibit No. Description
10.1* Third Amendment to the Amended and Restated Credit Agreement, dated
February 14, 2020
* Filed herewith
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