Exhibit 10.2

 

SECOND AMENDMENT TO
SECOND LIEN TERM LOAN CREDIT AGREEMENT

This second Amendment TO SECOND lien term loan CREDIT AGREEMENT (this
“Amendment”), effective as of the ____ day of February, 2012 (the “Second
Amendment Effective Date”), is entered into by and among MAGNUM HUNTER RESOURCES
CORPORATION, a Delaware corporation (the “Borrower”), the Guarantors party
hereto (the “Guarantors”), the Lenders party hereto (the “Lenders”) and CAPITAL
ONE, NATIONAL ASSOCIATION, as Administrative Agent for the Lenders (the
“Administrative Agent”).

RECITALS

WHEREAS, the Borrower, the Lenders and the Administrative Agent entered into
that certain Second Lien Term Loan Credit Agreement dated September 28, 2011 (as
amended by the First Amendment to Second Lien Term Loan Credit Agreement
effective as of December 6, 2011, and as further amended or restated from time
to time, the “Credit Agreement”); and

WHEREAS, the Borrower has requested that the Lenders and the Administrative
Agent amend certain provisions of the Credit Agreement and make the other
agreements more particularly described below; and

WHEREAS, said parties are willing to so amend the Credit Agreement and make such
agreements subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set
forth in this Amendment, the Borrower, the Guarantors, the Lenders and the
Administrative Agent agree as follows:

1. Defined Terms. Unless otherwise defined herein, capitalized terms used herein
have the meanings assigned to them in the Credit Agreement.

2. Amendments to Credit Agreement.

(a) Amendment to Section 9.18(a). Section 9.18(a) of the Credit Agreement is
hereby amended by (a) deleting the word “and” at the end of clause (ii) thereof,
(b) replacing the period at the end of clause (iii) with “; and”, and (c) adding
a new clause (iv) to read as follows: 

“(iv) Swap Agreements to hedge foreign exchange rate risks to which the Borrower
or any of its Subsidiaries has actual exposure.”

(b) Amendment to Section 9.18(c). Section 9.18(c) of the Credit Agreement is
hereby amended and restated in its entirety to read as follows: 

“(c) For purposes of this Section 9.18, purchases of put options and purchases
of price floors shall not be considered Swap Agreements.”

 

3. Partial Release; Consent to Transfer.

(a) The Administrative Agent, on behalf of itself and the Lenders, hereby
releases the Equity Interests of Hunter Disposal, LLC held by Triad Hunter, LLC
and all general intangibles related thereto (collectively, the “Released
Property”) and does hereby agree that all security interests, Liens and rights
in the Released Property granted to the Administrative Agent or the Lenders in
the Loan Documents are hereby waived, discharged and released in their entirety.
This release is a partial release only, limited solely to the security
interests, Liens and rights in the Released Property granted in the Loan
Documents and does not affect or impair in any manner any of the other
Collateral. 

(b) The Administrative Agent and the Lenders hereby consent to the transfer
(free and clear of any Liens) by Triad Hunter, LLC to GreenHunter Energy, Inc.
of the Released Property. The Administrative Agent and the Lenders hereby
(i) waive Section 9.11 of the Credit Agreement to the extent necessary to
effectuate the sale, transfer or other disposition of the Released Property and
(ii) agree that the value of the Released Property shall not be included in
calculating the usage of the basket in Section 9.11(e) of the Credit Agreement.
For the avoidance of doubt, the transfer of the Released Property does not
result in an obligation to prepay the Loans. 

4. Ratification. Each of the Borrower and the Guarantors hereby ratifies all of
its respective obligations under the Credit Agreement and each of the Loan
Documents to which it is a party, and agrees and acknowledges that the Credit
Agreement and each of the Loan Documents to which it is a party are and shall
continue to be in full force and effect as amended and modified by this
Amendment. Except as provided herein, nothing in this Amendment extinguishes,
novates or releases any right, claim, lien, security interest or entitlement of
any of the Lenders or the Administrative Agent created by or contained in any of
such documents nor is the Borrower nor any Guarantor released from any covenant,
warranty or obligation created by or contained herein or therein.

5. Representations and Warranties. The Borrower and Guarantors hereby represent
and warrant to the Administrative Agent and the Lenders that (a) this Amendment
has been duly executed and delivered on behalf of the Borrower and Guarantors,
(b) this Amendment constitutes a valid and legally binding agreement enforceable
against the Borrower and Guarantors in accordance with its terms, subject to
applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law, (c) the representations and warranties contained in the
Credit Agreement and the Loan Documents are true and correct on and as of the
date hereof in all material respects as though made as of the date hereof
(except to the extent any such representations and warranties are expressly
limited to an earlier date, in which case, such representations and warranties
shall continue to be true and correct as of such specified earlier date), (d) no
Default or Event of Default exists under the Credit Agreement or under any Loan
Document as of the Second Amendment Effective Date and (e) the execution,
delivery and performance of this Amendment has been duly authorized by the
Borrower and Guarantors.

-2-

 

6. Conditions to Effectiveness. This Amendment shall be effective on the Second
Amendment Effective Date upon satisfaction of the following conditions:

(a) the Borrower, the Guarantors and each of the Lenders shall have executed and
delivered to the Administrative Agent counterparts of this Amendment; 

(b) the Fifth Amendment to the Second Amended and Restated Credit Agreement
dated as of the date hereof, among the Borrower, Bank of Montreal, as
administrative agent thereunder, and the lenders party thereto, dated April 13,
2011 (as amended by the First Amendment to Second Amended and Restated Credit
Agreement effective as of June 30, 2011, the Second Amendment to Second Amended
and Restated Credit Agreement effective as of August 15, 2011, the Third
Amendment to Second Amended and Restated Credit Agreement effective as of
September 28, 2011, the Fourth Amendment to Second Amended and Restated Credit
Agreement effective as of December 6, 2011, and as further amended or restated
from time to time, the “First Lien Credit Agreement”) shall have been executed
by the Borrower, the Guarantors and each of the Lenders under and as defined in
the First Lien Credit Agreement, as amended by such amendment, and delivered to
Bank of Montreal, as Administrative Agent under and as defined in the First Lien
Credit Agreement, on substantially similar terms and containing substantially
similar provision as this Amendment; 

(c) the Borrower shall have delivered to the Administrative Agent (i) the
Reserve Report supporting the redetermination of the Borrowing Base effected
hereby, (ii) the related certificate required to be delivered by the Borrower
pursuant to Section 8.12(a) and (c) of the Credit Agreement, (iii) any
Engineering Reports as shall have been reasonably requested by the Required
Lenders in connection with the Reserve Report described in clause (i) above and
(iv) title information required to be delivered by the Borrower pursuant to
Section 8.13(a) of the Credit Agreement; and 

(d) the Borrower shall have paid to the Administrative Agent and the Lenders all
fees and expenses that are due in connection with this Amendment. 

7. Counterparts. This Amendment may be signed in any number of counterparts,
which may be delivered in original, electronic or facsimile form each of which
shall be construed as an original, but all of which together shall constitute
one and the same instrument.

8. Governing Law. This Amendment, all Notes, the other Loan Documents and all
other documents executed in connection herewith shall be deemed to be contracts
and agreements under the laws of the State of New York and of the United States
of America and for all purposes shall be construed in accordance with, and
governed by, the laws of New York and of the United States.

9. Final Agreement of the Parties. Any previous agreement among the parties with
respect to the subject matter hereof is superseded by the Credit Agreement, as
amended by this Amendment. Nothing in this Amendment, express or implied is
intended to confer upon any party other than the parties hereto any rights,
remedies, obligations or liabilities under or by reason of this Amendment.

[Signature Pages Follow]

-3-

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their respective officers thereunto duly authorized as of the Second
Amendment Effective Date.

 

 

BORROWER:

 

MAGNUM HUNTER RESOURCES

CORPORATION, a Delaware corporation

 

 

By: /s/ Ronald D. Ormand

Ronald D. Ormand

Chief Financial Officer

 

 

GUARANTORS:

 

PRC WILLISTON, LLC,

a Delaware limited liability company

 

By:   Magnum Hunter Resources Corporation,
         its sole member

 

 

By: /s/ Ronald D. Ormand

Ronald D. Ormand

Chief Financial Officer

 

 

MAGNUM HUNTER RESOURCES LP,

a Delaware limited partnership

 

By:  Magnum Hunter Resources GP, LLC,

        its general partner

 

       By: Magnum Hunter Resources Corporation,
              its sole member

 

               By: /s/ Ronald D. Ormand

            Ronald D. Ormand

            Chief Financial Officer

 

Signature Page to Second Amendment to Credit Agreement

-4-

 

 

  MAGNUM HUNTER RESOURCES GP, LLC,
a Delaware limited liability company
 
By:   Magnum Hunter Resources Corporation,
         its sole member
 
        By: /s/ Ronald D. Ormand
               Ronald D. Ormand
               Chief Financial Officer
 
 
TRIAD HUNTER, LLC,
a Delaware limited liability company
 
By: /s/ Ronald D. Ormand
       Ronald D. Ormand
       Vice President
 
 
EAGLE FORD HUNTER, INC.,
a Colorado corporation
 
 
By: /s/ Ronald D. Ormand
       Ronald D. Ormand
       Secretary
 
 
MAGNUM HUNTER PRODUCTION INC.,
a Kentucky corporation
 
 
By: /s/ Ronald D. Ormand
       Ronald D. Ormand
       Chief Financial Officer
 
 
NGAS HUNTER, LLC
 

By: /s/ Ronald D. Ormand
       Ronald D. Ormand
       Vice President and Treasurer

 

 

Signature Page to Second Amendment to Credit Agreement 

-5-

 

 

 

MHR CALLCO CORPORATION,

a corporation existing under the laws of the Province of Alberta

 

 

By: /s/ Ronald D. Ormand

       Ronald D. Ormand

       Vice President

 

 

MHR EXCHANGECO CORPORATION,

a corporation existing under the laws of the Province of Alberta

 

 

By: /s/ Ronald D. Ormand

       Ronald D. Ormand

       Vice President

 

 

WILLISTON HUNTER CANADA, INC.,

a corporation existing under the laws of the Province of Alberta

 

 

By: /s/ Ronald D. Ormand

       Ronald D. Ormand

       Executive Vice President and Chief

       Financial Officer

 

 

WILLISTON HUNTER INC.,

a Delaware corporation

 

 

By: /s/ Ronald D. Ormand

       Ronald D. Ormand

       Executive Vice President and Chief

       Financial Officer

 

 

 

 Signature Page to Second Amendment to Credit Agreement

 

-6-

 

 

 

WILLISTON HUNTER ND, LLC,

a Delaware limited liability company

 

 

By: /s/ Ronald D. Ormand

       Ronald D. Ormand

       Vice President and Treasurer

 

 

 

 Signature Page to Second Amendment to Credit Agreement

 

-7-

 

 

  ADMINISTRATIVE AGENT AND LENDER:       CAPITAL ONE, NATIONAL ASSOCIATION      
    By:  /s/ Nancy M. Mak   Name: Nancy M. Mak   Title: Vice President

 

 Signature Page to Second Amendment to Credit Agreement 

-8-

 

 

LENDER:       BMO HARRIS FINANCING, INC.           By:  /s/ Gumaro Tijerina   
Name: Gumaro Tijerina Title: Director

 

 Signature Page to Second Amendment to Credit Agreement

-9-

 

 

  LENDER:       CITIBANK, N.A.           By:  /s/ Don Dimitrievich   Name: Don
Dimitrievich   Title: Vice President

 

Signature Page to Second Amendment to Credit Agreement 

-10-

 

 

LENDER:       CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH

          By:   /s/ Shaheen Malik   Name: Shaheen Malik   Title: Vice President
    By: /s/ Michael Spaight   Name: Michael Spaight   Title: Associate

 

 Signature Page to Second Amendment to Credit Agreement

-11-

 

 

  LENDER:       UNIONBANCAL EQUITIES, INC.

          By:  /s/ John W. Schmidt   Name: John W. Schmidt   Title: Vice
President           By: /s/ Margaret Elower   Name: Margaret Elower   Title:
Vice President    

 

 Signature Page to Second Amendment to Credit Agreement

 

-12-

 

 

  LENDER:       SUNTRUST BANK, N.A.           By:  /s/ Gregory C. Magnuson  
Name: Gregory C. Magnuson   Title: Vice President

 

 Signature Page to Second Amendment to Credit Agreement

-13-

 

 

  LENDER:       DEUTSCHE BANK TRUST COMPANY AMERICAS           By:  /s/ Michael
Getz   Name: Michael Getz   Title: Vice President           DEUTSCHE BANK TRUST
COMPANY AMERICAS       By: /s/ Carin Keegan   Name: Carin Keegan   Title:
Director        

 

Signature Page to Second Amendment to Credit Agreement

 

 

 

  

-14-