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Exhibit 10.27
 
Second Amendment

to

Senior Revolving Credit Agreement

Among

Rosetta Resources Inc.,
as Borrower,

BNP Paribas,
as Administrative Agent,

and

The Lenders Signatory Hereto

Effective as of December 6, 2006

 
 

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Second Amendment to Senior Revolving Credit Agreement

This Second Amendment to Senior Revolving Credit Agreement (this “Second
Amendment”) executed effective as of the 6th of December, 2006 (the “Second
Amendment Effective Date”) is among Rosetta Resources Inc., a corporation formed
under the laws of the State of Delaware (the “Borrower”); each of the
undersigned guarantors (the “Guarantors”, and together with the Borrower, the
“Obligors”); each of the Lenders that is a signatory hereto; and BNP Paribas, as
administrative agent for the Lenders (in such capacity, together with its
successors, the “Administrative Agent”).

Recitals

A.            The Borrower, the Administrative Agent and the Lenders are parties
to that certain Senior Revolving Credit Agreement dated as of July 7, 2005, as
amended by the First Amendment to Senior Revolving Credit Agreement dated
September 26, 2005 (the “Credit Agreement”), pursuant to which the Lenders have
made certain credit available to and on behalf of the Borrower.

B.             The Borrower has requested and the Administrative Agent and the
Lenders have agreed to amend certain provisions of the Credit Agreement.

C.             NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

Section 1.               Defined Terms.  Each capitalized term which is defined
in the Credit Agreement, but which is not defined in this Second Amendment,
shall have the meaning ascribed such term in the Credit Agreement.  Unless
otherwise indicated, all section references in this Second Amendment refer to
the Credit Agreement.

Section 2.                Amendments to Credit Agreement.

2.1            Section 1.02.  The following definitions are hereby added or
amended and restated in its entirety as follows:

“Agreement” means this Senior Revolving Credit Agreement, as amended by the
First Amendment to Senior Revolving Credit Agreement, dated September 26, 2005
and the Second Amendment to Senior Revolving Credit Agreement, dated December 6,
2006, as the same may from time to time be further amended, modified,
supplemented or restated.

 
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2.2            Section 9.19.  Section 9.19 is hereby amended and restated in its
entirety as follows:

Section 9.19  Swap Agreements.  The Borrower will not, and will not permit any
Restricted Subsidiary to, enter into any Swap Agreements with any Person other
than (a) those Swap Agreements required under Section 8.18; (b) Swap Agreements
in respect of commodities (including price Swap Agreements, basis differential
Swap Agreements, caps, collars, floors and other similar agreements described in
the definition of “Swap Agreements”) (i) with an Approved Counterparty and (ii)
the notional volumes for which, (when aggregated with other commodity Swap
Agreements then in effect other than basis differential swaps on volumes already
hedged pursuant to other Swap Agreements) do not exceed, as of the date each
such Swap Agreement is executed, (A) 100% of the reasonably anticipated
projected production (as shown in the most recent Reserve Report) from proved,
developed, producing Oil and Gas Properties for each twelve month period during
which each such Swap Agreement is in effect, for the next thirty-six months
succeeding the execution of each such Swap Agreement and 75% of the reasonably
anticipated projected production (as shown in the most recent Reserve Report)
from proved, developed, producing Oil and Gas Properties for each twelve month
period during which each such Swap Agreement is in effect, for each twelve month
period after the first thirty-six months after each such Swap Agreement is
executed and (B) 50% of the reasonably anticipated projected production (as
shown in the most recent Reserve Report) from proved, developed, non-producing
Oil and Gas Properties for each twelve month period during which each such Swap
Agreement is in effect, for the next twenty-four months succeeding the execution
of each such Swap Agreement and 35% of the reasonably anticipated projected
production (as shown in the most recent Reserve Report) from proved, developed,
non-producing Oil and Gas Properties for each twelve month period during which
each such Swap Agreement is in effect, for the period of twelve months
succeeding the two-year anniversary of the execution of each such Swap
Agreement, and 0% of the reasonably anticipated projected production (as shown
in the most recent Reserve Report) from proved, developed, non-producing Oil and
Gas Properties for each twelve month period during which each such Swap
Agreement is in effect, for each calendar year thereafter; provided, however,
that for purposes of this Section 9.19(b), put options and price floors for
crude oil and natural gas shall be disregarded; and (c) Swap Agreements in
respect of interest rates with an Approved Counterparty, as follows: (i) Swap
Agreements effectively converting interest rates from fixed to floating, the
notional amounts of which (when aggregated with all other Swap Agreements of the
Borrower and its Restricted Subsidiaries then in effect effectively converting
interest rates from fixed to floating) do not exceed 50% of the then outstanding
principal amount of the Borrower’s Debt for borrowed money which bears interest
at a fixed rate (after netting out any Swap Agreements then in effect
effectively converting interest rates from floating to fixed) and (ii) Swap
Agreements effectively converting interest rates from floating to fixed, the
notional amounts of which (when aggregated with all other Swap Agreements of the
Borrower and its Restricted Subsidiaries then in effect effectively converting
interest rates from floating to fixed) do not exceed 75% of the then outstanding
principal amount of the Borrower’s Debt for borrowed money which bears interest
at a floating rate (after netting out any Swap Agreements then in effect
effectively converting interest rates from floating to fixed). For purposes of
this Section 9.19(b), the notional volumes and corresponding swap volumes so
determined shall be calculated and recorded  separately for natural gas and
crude oil, and natural gas volumes shall include associated natural gas liquids
volumes.  In no event shall any Swap Agreement contain any current requirement,
agreement or covenant for the Borrower or any Restricted Subsidiary to post
collateral or margin, other than letters of credit permitted by this Agreement
(in an amount not to exceed $50,000,000 in the aggregate), to secure their
obligations under such Swap Agreement or to cover market exposures.

 
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Section 3.              Conditions Precedent.  The effectiveness of this Second
Amendment is subject to the receipt by the Administrative Agent of the following
documents and satisfaction of the other conditions provided in this Section 3,
each of which shall be reasonably satisfactory to the Administrative Agent in
form and substance:

3.1            Payment of Outstanding Invoices.  Payment by the Borrower to the
Administrative Agent of all fees and other amounts due and payable on or prior
to the Second Amendment Effective Date, including, to the extent invoiced,
reimbursement or payment of all out-of-pocket expenses required to be reimbursed
or paid by the Borrower.

3.2            Second Amendment.  The Administrative Agent shall have received
multiple counterparts as requested of this Second Amendment from each Lender.

3.3            No Default.  No Default or Event of Default shall have occurred
and be continuing as of the Second Amendment Effective Date.

Section 4.               Representations and Warranties; Etc.  Each Obligor
hereby affirms:  (a) that as of the date of execution and delivery of this
Second Amendment, all of the representations and warranties contained in each
Loan Document to which such Obligor is a party are true and correct in all
material respects as though made on and as of the Second Amendment Effective
Date (unless made as of a specific earlier date, in which case, was true as of
such date); and (b) that after giving effect to this Second Amendment and to the
transactions contemplated hereby, no Defaults exist under the Loan Documents or
will exist under the Loan Documents.

Section 5.                Miscellaneous.

5.1            Confirmation.  The provisions of the Credit Agreement (as amended
by this Second Amendment) shall remain in full force and effect in accordance
with its terms following the effectiveness of this Second Amendment.

5.2            Ratification and Affirmation of Obligors.  Each of the Obligors
hereby expressly (i) acknowledges the terms of this Second Amendment, (ii)
ratifies and affirms its obligations under the Guarantee Agreement and the other
Security Instruments to which it is a party, (iii) acknowledges, renews and
extends its continued liability under the Guarantee Agreement and the other
Security Instruments to which it is a party and agrees that its guarantee under
the Guarantee Agreement and the other Security Instruments to which it is a
party remains in full force and effect with respect to the Indebtedness as
amended hereby.

 
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5.3            Counterparts.  This Second Amendment may be executed by one or
more of the parties hereto in any number of separate counterparts, and all of
such counterparts taken together shall be deemed to constitute one and the same
instrument.

5.4            No Oral Agreement.  This written Second Amendment, the Credit
Agreement and the other Loan Documents executed in connection herewith and
therewith represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or unwritten oral agreements
of the parties.  There are no subsequent oral agreements between the parties.

5.5            Governing Law.  This Second Amendment (including, but not limited
to, the validity and enforceability hereof) shall be governed by, and construed
in accordance with, the laws of the State of New York.

 
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IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to be
duly executed effective as of the date first written above.

BORROWER:
ROSETTA RESOURCES INC.
                               
By:
         
Michael J. Rosinski, Executive Vice President,
     
Chief Financial Officer, Secretary and Treasurer
                     
GUARANTORS:
         
ROSETTA RESOURCES OFFSHORE, LLC
   
ROSETTA RESOURCES HOLDINGS, LLC
   
ROSETTA RESOURCES OPERATING GP, LLC
   
ROSETTA RESOURCES OPERATING LP
             
    By: Rosetta Resources Operating GP, LLC, its general partner
             
By:
         
Michael J. Rosinski, Executive Vice
       
President, Chief Financial Officer,
       
Secretary and Treasurer
 

 
Second Amendment – Senior Revolving Credit Agreement
Signature Page - 6
 
 
 

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ADMINISTRATIVE AGENT:
BNP PARIBAS,
 
as Administrative Agent
                   
By:
     
Name:
   
Title:
                   
By:
     
Name:
   
Title:
         
LENDERS:
BNP PARIBAS
                 
By:
     
Name:
   
Title:
                   
By:
     
Name:
   
Title:
           
MIZUHO CORPORATE BANK, LTD.
                 
By:
     
Name:
   
Title:
                   
THE FROST NATIONAL BANK
                 
By:
     
Name:
   
Title:
 

 
Second Amendment – Senior Revolving Credit Agreement
Signature Page - 7
 
 
 

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LENDERS:
AMEGY BANK, NATIONAL ASSOCIATION
                 
By:
     
Name:
   
Title:
                   
WELLS FARGO BANK, N.A.
                 
By:
     
Name:
   
Title:
                   
BANK OF TEXAS, N.A.
                         
By:
     
Name:
   
Title:
                   
ALLIED IRISH BANKS, p.l.c.
                 
By:
     
Name:
   
Title:
                   
By:
     
Name:
   
Title:
 

 
Second Amendment – Senior Revolving Credit Agreement
Signature Page - 8
 
 
 

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LENDERS:
THE BANK OF TOKYO – MITSUBISHI UFJ, LTD., NEW YORK BRANCH (AS SUCCESSOR BY
MERGER TO UFJ BANK LIMITED)
                 
By:
     
Name:
   
Title:
                   
COMERICA BANK
                 
By:
     
Name:
   
Title:
                   
JPMORGAN CHASE BANK, N.A.
                 
By:
     
Name:
   
Title:
                   
GUARANTY BANK, FSB
                 
By:
     
Name:
   
Title:
                   
CALYON NEW YORK BRANCH
                 
By:
     
Name:
   
Title:
           
By:
     
Name:
   
Title:
 

 
Second Amendment – Senior Revolving Credit Agreement
Signature Page - 9
 
 
 

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LENDERS:
WACHOVIA BANK, NATIONAL ASSOCIATION
                 
By:
     
Name:
   
Title:
           
UNION BANK OF CALIFORNIA, N.A.
                 
By:
     
Name:
   
Title:
 

Second Amendment – Senior Revolving Credit Agreement
Signature Page - 10
 
 

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