Exhibit 10.1

 

FIRST AMENDMENT OF AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS FIRST AMENDMENT OF AMENDED AND RESTATED CREDIT AGREEMENT (this
“Amendment”), dated as of March 24, 2003, is by and between CARBON ENERGY
CORPORATION (USA), a Colorado corporation (“Borrower”), and BANK OF OKLAHOMA,
NATIONAL ASSOCIATION, a national banking association (“BOK”).

 

RECITALS

 

A.                  Borrower and BOK entered into an Amended and Restated Credit
Agreement dated as of December 31, 2002 (the “Credit Agreement”), in order to
set forth the terms upon which BOK would make advances to Borrower, issue
letters of credit at the request of Borrower and extend credit to Borrower in
connection with Borrower’s hedging activities and by which such advances,
letters of credit and credit extensions would be governed and repaid. 
Capitalized terms used herein but not defined herein shall have the same
meanings as set forth in the Credit Agreement.

 

B.                    Borrower and BOK desire that this Amendment be executed
and delivered in order to amend certain terms and provisions of the Credit
Agreement.

 

AMENDMENT

 

NOW, THEREFORE, in consideration of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:

 

1.                             Credit Agreement.  The Credit Agreement shall be,
and hereby is, amended as follows as of the date hereof:

 

(a)                                            By substituting the following for
the definition of “Borrowing Base” in Section 1.1 on page 2 of the Credit
Agreement:

 

“Borrowing Base” means, at any time prior to the Maturity Date, the aggregate
loan value of all Borrowing Base Properties, as determined by BOK in its sole
and absolute discretion, using such assumptions as to pricing, discount factors,
discount rates, expenses and other factors as BOK customarily uses as to
borrowing-base oil and gas loans at the time such determination is made;
provided that the Borrowing Base for the time period from March 25, 2003 through
the ensuing redetermination or reduction of the Borrowing Base pursuant to
Section 2.9 below shall be $14,000,000, unless Borrower and BOK hereafter
mutually agree upon a different amount.

 

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(b)                                           By substituting the following for
the definition of “Borrowing Base Period” in Section 1.1 on page 2 of the Credit
Agreement:

 

“Borrowing Base Period” means: (a) the time period from the date of this
Agreement through March 24, 2003; (b) the time period from March 25, 2003
through November 30, 2003; (c) thereafter, each six-month period beginning on
June 1 or December 1 of each year, until the June 1 or December 1 most nearly
preceding the Maturity Date; and (d) thereafter, the time period from the June 1
or December 1 most nearly preceding the Maturity Date through the Maturity Date.

 

(c)                                            By substituting the following for
the definition of “Maximum Loan Amount” in Section 1.1 on page 8 of the Credit
Agreement:

 

“Maximum Loan Amount” means $14,000,000; provided that, upon the request of
Borrower, BOK may, in its sole discretion and upon such terms and conditions as
BOK may determine, increase said amount to an amount not greater than
$40,000,000 by giving written notice of such increase to Borrower, but nothing
contained in this Agreement, the Note or any other Loan Document shall be deemed
to commit or require BOK to grant any such increase.

 

2.                               Loan Documents.  All references in any document
to the Credit Agreement shall be deemed to refer to the Credit Agreement, as
amended pursuant to this Amendment.

 

3.                               Conditions Precedent.  The obligations of the
parties under this Amendment are subject, at the option of BOK, to the prior
satisfaction of the condition that Borrower shall have delivered to BOK the
following (all documents to be satisfactory in form and substance to BOK and, if
appropriate, duly executed and/or acknowledged on behalf of the parties other
than BOK):

 

(a)                                            This Amendment.

 

(b)                                           A Consent of Guarantor in the form
of Exhibit A attached hereto and made a part hereof.

 

(c)                                            Any and all other loan documents
required by BOK, including without limitation any and all amendments to the
Security Documents as may be required by BOK.

 

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4.                              Certification by Borrower.  Borrower hereby
certifies to BOK that, as of the date of this Amendment, except as previously
disclosed by Borrower to BOK: (a) all of Borrower’s representations and
warranties contained in the Credit Agreement are true, accurate and complete in
all material respects, (b) Borrower has performed and complied with all
agreements and conditions required to be performed or complied with by Borrower
under the Credit Agreement and/or any Loan Document on or prior to this date,
and (c) no Default or Event of Default has occurred under the Credit Agreement.

 

5.                              Continuation of the Credit Agreement.  Except as
specified in this Amendment, the provisions of the Credit Agreement shall remain
in full force and effect, and if there is a conflict between the terms of this
Amendment and those of the Credit Agreement, the terms of this Amendment shall
control.

 

6.                              Expenses.  Borrower shall pay all expenses
incurred in connection with the transactions contemplated by this Amendment,
including without limitation all fees and expenses of the attorney for BOK and
any and all filing and recording expenses.

 

7.                              Miscellaneous.  This Amendment shall be governed
by and construed under the laws of the State of Colorado and shall be binding
upon and inure to the benefit of the parties hereto and their successors and
assigns.  This Amendment may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one
instrument.

 

EXECUTED as of the date first above written.

 

 

 

BANK OF OKLAHOMA, NATIONAL ASSOCIATION

 

 

 

 

 

By:

 

 

 

 

Thomas M. Foncannon,

 

 

Senior Vice President

 

 

 

 

 

CARBON ENERGY CORPORATION (USA)

 

 

 

 

 

By:

 

 

 

 

Kevin D. Struzeski,

 

 

Chief Financial Officer

 

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EXHIBIT A

 

CONSENT OF GUARANTOR

 

THIS CONSENT OF GUARANTOR (this “Consent”), dated as of March 24, 2003, is from
CARBON ENERGY CORPORATION, a Colorado corporation (“Guarantor”), to BANK OF
OKLAHOMA, NATIONAL ASSOCIATION, a national banking association (“BOK”).

 

RECITALS

 

A.                 Guarantor has executed and delivered to BOK a Guaranty dated
as of December 31, 2002 (the “Guaranty”), to guaranty certain obligations of
Carbon Energy Corporation (USA) (“Borrower”) to BOK under or in connection with
an Amended and Restated Credit Agreement dated as of December 31, 2002 (the
“Credit Agreement”).

 

B.                   The Credit Agreement is being amended pursuant to a First
Amendment of Amended and Restated Credit Agreement of even date herewith (the
“Amendment”), between Borrower and BOK.

 

C.                   The parties desire that Guarantor consent to the
modifications of the Credit Agreement being made pursuant to the Amendment.

 

CONSENT

 

NOW, THEREFORE, in consideration of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Guarantor hereby consents to the transactions set forth in and contemplated by
the Amendment, including without limitation the change in the “Maximum Loan
Amount” (as defined in the Credit Agreement) and the “Borrowing Base” (as
defined in the Credit Agreement) to $14,000,000.

 

This Consent may be executed in any number of counterparts, each of which shall
be an original, but all of which together shall constitute one and the same
instrument.  Guarantor hereby ratifies the Guaranty.

 

EXECUTED as of March 24, 2003.

 

 

 

CARBON ENERGY CORPORATION

 

 

 

By:

 

 

 

 

 

,

 

 

 

 

 

A-1

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