First Amendment To Revolving Credit 10/31/05

Exhibit 10.31



FIRST AMENDMENT TO REVOLVING CREDIT

AND TERM LOAN AGREEMENT



THIS FIRST AMENDMENT TO REVOLVING CREDIT AND TERM LOAN AGREEMENT (this "AMENDMENT") dated as of October 31, 2005, is entered into by and among ATLAS PIPELINE PARTNERS, L.P., a Delaware limited partnership ("BORROWER"); ATLAS PIPELINE NEW YORK, LLC, a Pennsylvania limited liability company ("APL NEW YORK"); ATLAS PIPELINE OHIO, LLC, a Pennsylvania limited liability company ("APL OHIO"); ATLAS PIPELINE PENNSYLVANIA, LLC, a Pennsylvania limited liability company ("APL PENNSYLVANIA"); ATLAS PIPELINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership ("APL OPERATING"); ATLAS PIPELINE MID-CONTINENT LLC, a Delaware limited liability company ("APL MID-CONTINENT"); ELK CITY OKLAHOMA PIPELINE, L.P., a Texas limited partnership ("ELK CITY"); ELK CITY OKLAHOMA GP, LLC, a Delaware limited liability company ("ELK CITY GP"); and ATLAS ARKANSAS PIPELINE LLC, an Oklahoma limited liability company ("ATLAS ARKANSAS"; Atlas Arkansas, Elk City GP, Elk City, APL Mid-Continent, APL New York, APL Ohio, APL Pennsylvania and APL Operating are collectively referred to herein as the "GUARANTORS," and Borrower and Guarantors are collectively referred to herein as the "OBLIGORS"); each of the lenders party hereto (individually, together with its successors and assigns, a "LENDER," and collectively, "LENDERS"); and WACHOVIA BANK, NATIONAL ASSOCIATION, as administrative agent for the Lenders (in such capacity, together with its successors in such capacity, "ADMINISTRATIVE AGENT").



R E C I T A L S



A. Borrower, certain Guarantors, Administrative Agent and the Lenders have entered into that certain Revolving Credit and Term Loan Agreement dated as of April 14, 2005 (as renewed, extended, amended or restated from time to time, the "CREDIT AGREEMENT").



B. Borrower has entered into that certain Stock Purchase Agreement (as amended, supplemented, restated or otherwise modified prior to the date hereof, the "STOCK PURCHASE AGREEMENT") dated of even date herewith, with Enogex Inc., an Oklahoma corporation ("ENOGEX"), whereby Borrower will purchase from Enogex all of the issued and outstanding common stock of Atlas Arkansas (the "SHARES"; the acquisition of the Shares contemplated by the Stock Purchase Agreement is herein called the "ATLAS ARKANSAS ACQUISITION").



C. In order to facilitate the Atlas Arkansas Acquisition, Borrower has requested that Administrative Agent and the Lenders amend certain provisions of the Credit Agreement to, among other things, increase the Aggregate Maximum Revolver Amount.



D. Administrative Agent and the Lenders have agreed to amend the Credit Agreement as so requested, subject to the terms and conditions set forth herein.



NOW, THEREFORE, in consideration of the foregoing, and intending to be legally bound, the parties agree as follows:



SECTION 1. TERMS DEFINED IN CREDIT AGREEMENT. As used in this Amendment, except as may otherwise be provided herein, all capitalized terms which are defined in the Credit Agreement shall have the same meaning herein as therein, all of such terms and their definitions being incorporated herein by reference.



SECTION 2. AMENDMENTS TO CREDIT AGREEMENT. Subject to the conditions set forth in SECTION 3 hereof, the Credit Agreement is hereby amended as follows:





(a) Section 1.02 of the Credit Agreement (Definitions) is hereby amended as follows:



(i) The definition of "AGGREGATE MAXIMUM REVOLVER AMOUNT" is hereby restated in its entirety to read as follows:



"AGGREGATE MAXIMUM REVOLVER AMOUNT at any time shall equal the sum of the Maximum Revolver Amounts of the Revolver Lenders (Four Hundred Million Dollars ($400,000,000)), as the same may be increased pursuant to SECTION 2.11 or reduced pursuant to SECTIONS 2.03(a) or 2.07(b)(i)."



(ii) The definition of "CONSOLIDATED EBITDA" is hereby restated in its entirety to read as follows:



"CONSOLIDATED EBITDA shall mean, for any trailing twelve-month period, the sum of (i) Consolidated Net Income for such period, plus (ii) the following expenses or charges to the extent deducted from Consolidated Net Income in such period: interest, income taxes, depreciation, depletion, amortization, non-cash compensation on long-term incentive plans, and other non-cash charges to Consolidated Net Income, minus (iii) non-cash credits to Consolidated Net Income, provided, that, the following adjustments shall be made: (a) Consolidated EBITDA for each quarter of 2005 shall be calculated after giving pro forma effect to the Elk City Acquisition and the adjustments described on SCHEDULE 1.01 hereto; and (b) the amount of Consolidated EBITDA attributable to Atlas Arkansas' interest in NOARK shall be (1) for the four fiscal quarters ending September 30, 2005, $13,133,000, and (2) for each of the four fiscal quarters ending December 31, 2005, March 31, 2006, and June 30, 2006, (A) for periods prior to October 31, 2005, Consolidated EBITDA of Atlas Arkansas minus Maintenance Capital Expenditures of Atlas Arkansas, and (B) on or after October 31, 2005, the amount of cash distributions received.



For purposes hereof, "MAINTENANCE CAPITAL EXPENDITURES" shall mean without duplication for any period, the aggregate of all capital expenditures related to the Pipeline determined in accordance with GAAP, excluding (a) expenditures in respect of any transaction or any series of related transactions to acquire any asset, the acquisition of which is not made to maintain or improve an existing asset and (b) expenditures of any proceeds of any insurance, condemnation award or other compensation paid or payable in respect of any loss or damage to or any condemnation or taking of, any capital asset less the reasonable fees, taxes and expenses paid to collect such proceeds, to rebuild or repair such Pipeline equipment or such other asset."



(iii) The definition of "CONSOLIDATED FUNDED DEBT" is hereby amended by deleting clause (vii) thereof in its entirety, and replacing it with the following:



"(vii) until March 31, 2006, Consolidated Funded Debt shall be calculated excluding debt evidenced by the NOARK Notes; thereafter, to the extent that Atlas Arkansas' portion of the NOARK Notes has not been repurchased, such portion shall be included in such calculations; SWPL's portion of the NOARK Notes shall not be included in such calculations at any time."



(iv) The definition of "CONSOLIDATED INTEREST EXPENSE" is hereby amended by deleting the word "and" before clause (iii) thereof, and adding the following clause after the word "quarters" at the end of such clause (iii):





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"; and (iv) until March 31, 2006, Consolidated Interest Expense shall be calculated excluding debt evidenced by the NOARK Notes; thereafter, to the extent that Atlas Arkansas' portion of the NOARK Notes has not been repurchased, such portion shall be included in such calculations; SWPL's portion of the NOARK Notes shall be excluded from such calculations; provided, however, such portion shall be included in such calculations to the extent Atlas Arkansas or any other Obligor makes any interest payment with respect to such portion or assumes, directly or indirectly, any liability for any interest payment with respect to such portion"



(v) The definition of "GUARANTOR" is hereby restated in its entirety to read as follows:



"GUARANTOR shall mean each Initial Guarantor and each Subsidiary of Borrower hereafter formed or acquired, except for the Unrestricted Entities (if any) and NOARK (unless and until NOARK becomes a Wholly Owned Subsidiary."



(vi) The definition of "LC COMMITMENT" is hereby amended by replacing the words "Ten Million Dollars ($10,000,000)" therein with the words "Fifty Million Dollars ($50,000,000)".



(vii) The definition of "MASTER NATURAL GAS GATHERING AGREEMENTS" is hereby restated in its entirety as follows:



"MASTER NATURAL GAS GATHERING AGREEMENTS shall mean those agreements listed as ITEMS 2, 3, 4, 5 and 6 on SCHEDULE 7.23, as such agreements may be amended, extended, renewed or replaced from time to time."



(viii) The definition of "PIPELINES" is hereby restated in its entirety as follows:



"PIPELINES shall mean the natural gas transportation systems and gas gathering systems and related processing facilities now owned and operated (or in the case of the NOARK Pipeline, operated) as private use gathering systems by the Obligors located in the states of New York, Ohio, Pennsylvania, Oklahoma, Missouri and Texas, and all additions thereto, and such other natural gas gathering systems and related processing facilities owned and operated (or in the case of the NOARK Pipeline, operated) by the Obligors hereafter."



(b) The following definitions are hereby added to Section 1.02 of the Credit Agreement where alphabetically appropriate:



(i) "ATLAS ARKANSAS means Atlas Arkansas Pipeline LLC, an Oklahoma limited liability company."



(ii) "NOARK means NOARK Pipeline System, Limited Partnership, an Arkansas limited partnership."



(iii) "NOARK FINANCE means NOARK Pipeline Finance, L.L.C., an Oklahoma limited liability company, a wholly-owned subsidiary of NOARK."



(iv) "NOARK NOTES means (i) the 7.15% Notes due 2018 issued by NOARK Finance pursuant that certain Indenture dated as of June 1, 1998, between NOARK Finance and The Bank of New York, as trustee, and (ii) the related Loan Agreement dated as of June 1, 1998, between NOARK, as borrower, and NOARK Finance, as lender."





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(v) "NOARK PARTNERSHIP AGREEMENT means that certain Amended and Restated Agreement of Limited Partnership of NOARK dated January 12, 1998 (as the same may be amended, restated, or otherwise modified from time to time).



(vi) "NOARK PIPELINE means the natural gas transportation system and gas gathering systems owned by NOARK."



(vii) "SWPL means Southwestern Energy Pipeline Company, an Arkansas corporation."



(c) Section 2.07 of the Credit Agreement (Prepayments) is hereby amended by replacing subsections (b) and (c) thereof with the following:



"(b) MANDATORY PREPAYMENTS.



(i) Borrower shall prepay the Revolver Principal Debt in an amount equal to 100% of Net Cash Proceeds up to an aggregate amount of One Hundred Seventy-Five Million Dollars ($175,000,000), not later than the third Business Day following the receipt thereof. The Aggregate Maximum Revolver Amount shall be permanently reduced by the amount of each such prepayment made pursuant to this SECTION 2.07(b)(i).



(ii) Thereafter, Borrower shall prepay the Principal Debt in an amount equal to Net Cash Proceeds required to maintain a Senior Secured Leverage Ratio of 4.00 to 1.00 or less, not later than the third Business Day following receipt of such Net Cash Proceeds.



(iii) Notwithstanding CLAUSES (i) and (ii) above, following mandatory prepayments under CLAUSE (i) in an aggregate of One Hundred Million Dollars ($100,000,000) of Equity Net Cash Proceeds, the receipt by Borrower of subsequent Equity Net Cash Proceeds of up to $40,000,000 shall not trigger a mandatory prepayment of Principal Debt to the extent such proceeds are used to fund the construction of the Sweetwater gas plant in Beckham County, Oklahoma, and associated gathering and pipeline interconnects.



(c) GENERALLY. Prepayments permitted under this SECTION 2.07 shall be without premium or penalty, except as required under SECTION 5.05 for prepayment of LIBOR Loans. Any voluntary prepayment of the Principal Debt shall be applied to the Revolver Principal Debt and the Term Loan Principal Debt at the Borrower's discretion; provided, that upon any Default or Event of Default, any such prepayment shall be allocated pro rata to each Revolver Lender and each Term Loan Lender in accordance with its Percentage Share of the Principal Debt. Any mandatory prepayment of the Principal Debt under CLAUSE (b)(ii) above shall be applied first against the Term Loan Principal Debt, and the balance, if any, shall be applied against the Revolver Principal Debt. With respect to the Revolver Loans, any mandatory prepayments made pursuant to CLAUSE (b)(ii) above and any voluntary prepayments may be reborrowed subject to the then effective Aggregate Maximum Revolver Amount."



(d) The following is hereby added to the Credit Agreement as SECTION 2.11:



"Section 2.11 INCREASE IN REVOLVER FACILITY.





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(a) Provided there exists no Default and subject to the conditions set forth under CLAUSE (e) below, upon notice to the Administrative Agent (which shall promptly notify the Lenders), Borrower may from time to time request an increase in the aggregate Revolver Commitments under the Revolver Facility; provided, that (i) the Aggregate Maximum Revolver Amount shall not exceed $475,000,000, and (ii) such increase of the Revolver Facility shall be in a minimum amount of $25,000,000, or integral multiples of $1,000,000 in excess thereof. At the time of sending such notice, Borrower (in consultation with the Administrative Agent) shall specify the time period within which each Revolver Lender is requested to respond.



(b) Each Revolver Lender shall notify the Administrative Agent within such time period whether or not it agrees to increase its Revolver Commitment and, if so, whether by an amount equal to, greater than, or less than its Percentage Share of such requested increase. Any Revolver Lender not responding within such time period shall be deemed to have declined to increase its Revolver Commitment.



(c) The Administrative Agent shall notify Borrower of the Revolver Lenders' responses to the request made hereunder. To achieve the full amount of a requested increase and subject to the approval of the Administrative Agent and the Issuing Bank (which approvals shall not be unreasonably withheld), Borrower may also invite additional Eligible Assignees to become Revolver Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative Agent and its counsel.



(d) If the aggregate Revolver Commitments are increased in accordance with this Section, the Administrative Agent and Borrower shall determine the effective date (such date, the "INCREASE EFFECTIVE DATE") and the final allocation of such increase. The Administrative Agent shall promptly (i) notify Borrower of the final allocation of such increase in the Revolver Commitment and the Increase Effective Date, and (ii) notify each Revolver Lender of its Revolver Commitment as of the Increase Effective Date.



(e) As a condition precedent to such increase, Borrower shall deliver to the Administrative Agent a certificate of each Obligor dated as of the Increase Effective Date signed by a Responsible Officer of such Obligor (i) certifying and attaching the resolutions adopted by such Obligor 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 VII and the other Loan Documents are true and correct on and as of the Increase Effective 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 except that for purposes of this SECTION 2.11, the representations and warranties contained in SECTION 7.02 shall be deemed to refer to the most recent statements furnished pursuant to CLAUSES (a) and (b), respectively, of SECTION 8.01, (B) no Default exists, (C) no Material Adverse Effect shall have occurred, and (D) the Senior Secured Leverage Ratio does not exceed 4.00 to 1.00. To the extent necessary to keep the outstanding Revolver Loans ratable with any revised Percentage Shares of the Revolver Lenders arising from any nonratable increase in the Revolver Commitments under this Section, Borrower shall prepay Revolver Loans outstanding on the Increase Effective Date and/or Lenders shall make assignments pursuant to arrangements satisfactory to the Administrative Agent (provided, that in each case, Borrower shall pay any additional amounts required pursuant to SECTION 5.05).





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(f) This Section shall supersede any provisions in SECTIONS 4.05 or 12.04 to the contrary."



(e) Section 4.05(a) of the Credit Agreement (Set-off) is hereby amended by adding the following after the word "Subsidiary" therein:



"(except for NOARK, unless and until NOARK becomes a Wholly Owned Subsidiary)"



(f) Section 7.07 of the Credit Agreement (Use of Loans) is hereby amended by replacing clause (iii) therein with the following:



"(iii) for the development of the Pipeline Properties and the acquisition of Pipeline Properties and related assets (or equity interests therein) by the Obligors"



(g) Section 8.01 of the Credit Agreement (Reporting Requirements) is hereby amended by deleting the phrase "and consolidating" each time it appears in subsections (a) and (b) thereof.



(h) Section 8.01 of the Credit Agreement (Reporting Requirements) is hereby amended by replacing subsection (e) thereof with the following:



"(e) REGULATORY FILINGS, ETC. Promptly upon its becoming available, (i) each financial statement, report, notice or proxy statement sent by the Borrower to its unitholders generally and each regular or periodic report and any registration statement, prospectus or written communication (other than transmittal letters) in respect thereof filed by the Borrower with or received by the Borrower in connection therewith from any securities exc ...