Exhibit 10.1

 

seCond AMENDMENT TO FORBEARANCE AGREEMENT

 

This SECOND AMENDMENT TO FORBEARANCE AGREEMENT (this “Amendment”), dated May 31,
2016, is by and among ENERJEX RESOURCES, INC., a Nevada corporation (“Parent”),
ENERJEX KANSAS, INC. (f/k/a Midwest Energy, Inc.), a Nevada corporation
(“EnerJex Kansas”), WORKING INTEREST, LLC, a Kansas limited liability company
(“Working Interest”), BLACK SABLE ENERGY, LLC, a Texas limited liability company
(“Black Sable”), BLACK RAVEN ENERGY, INC., a Nevada corporation (“Black Raven”),
ADENA, LLC, a Colorado limited liability company (“Adena”; together with Parent,
EnerJex Kansas, Working Interest, Black Sable and Black Raven, collectively,
“Borrowers” and each, a “Borrower”), and TEXAS CAPITAL BANK, N.A., a national
banking association, as a Bank, L/C Issuer and Administrative Agent (in such
latter capacity and together with its successors and permitted assigns in such
capacity the “Administrative Agent”), and the several banks and financial
institutions from time to time parties to the Credit Agreement, as defined below
(the “Banks”). Terms defined in the Forbearance Agreement between the
Administrative Agent, the Banks, and the Borrowers dated April 4, 2016, (the
“Forbearance Agreement”), are used herein as therein defined, unless otherwise
defined herein or the context otherwise requires.

 

R E C I T A L S:

 

WHEREAS, the Borrowers have requested that the Banks extend the Forbearance
Period of the Forbearance Agreement;

 

WHEREAS, Events of Default exist under the Credit Agreement and are not being
satisfied or waived by this Amendment; and

 

WHEREAS, the Lenders are willing to extend the Forbearance Period of the
Forbearance Agreement under the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Borrowers, the Administrative Agent and the Banks agree as follows:

 

1.                  Additional Definitions. The following definition is hereby
added to Section 10.1 of the Credit Agreement as follows:

 

“Second Amendment to Forbearance Agreement” means the Second Amendment to
Forbearance Agreement dated May 31, 2016, between Administrative Agent, the
Banks, and the Borrowers, amending the Forbearance Agreement.

 

2.                  Amended Definitions. The following definition in
Section 10.1 of the Credit Agreement is hereby amended and restated in its
entirety as follows:

 

“Termination Event” means the earliest to occur of: (i) August 1, 2016, (ii) the
occurrence of a Non-Forbearance Default, (iii) any of the Borrowers has violated
or failed to satisfy any provision of the Forbearance Agreement within the time
limitations set forth in the Forbearance Agreement, time being of the essence in
the performance by the Borrowers of their obligations under each Section of the
Forbearance Agreement, (iv) any representation, warranty, certification or
statement made or deemed to have been made by or on behalf of the Borrowers in
connection with the Forbearance Agreement, was incorrect in any material respect
when made in the reasonable judgment of the Administrative Agent, (v) any of the
Borrowers or any Person representing any of them shall deny (a) the liability of
any of the Borrowers under any Loan Document or (b) the enforceability of any
provision of any Loan Document or the Forbearance Agreement, (vi) the failure of
any of the Borrowers to immediately deposit any payments or revenues received by
it into the TCB Accounts, (vii) the occurrence of any event described in
Section 9.01(f) of the Credit Agreement, or (viii) the commencement by any
Person, other than the Administrative Agent or the Banks, of any action or
proceeding against any of the Borrowers, including a suit or other action (other
than routine notices of Lien filings) to enforce any Liens against any Oil and
Gas Properties or other assets of any of the Borrowers.

 

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3.                  Representations. To induce the Administrative Agent and the
Banks to enter into this Amendment, each of the Borrowers represents and
warrants to the Administrative Agent and the Banks as follows with the intention
that the Administrative Agent and the Banks shall rely thereon without any
investigation or verification thereof by the Administrative Agent, the Banks or
their respective counsel:

 

3.1 Execution of Agreement. This Amendment has been duly executed and delivered
by or on behalf of each of the Borrowers.

 

3.2 Authorized Action. The execution, delivery and performance of this Amendment
have been duly authorized by all necessary corporate or company action of the
respective Borrowers. Each of the Borrowers are duly organized, validly existing
and in good standing in their respective states of organization.

 

3.3 No Violation of Law. The consummation of this Amendment does not violate any
Laws applicable to any of the Borrowers.

 

3.4 Other Funds. None of the Borrowers (i) has any other funds on deposit at any
financial institution other than Texas Capital Bank, N.A. or (ii) owns any
marketable securities (other than securities issued by Oakridge Energy, Inc.) or
other liquid assets.

 

3.5 Non-Forbearance Defaults. No Non-Forbearance Defaults exist.

 

4.                  Certain Covenants.

 

4.1 Capital Expenditures. During the period from the date hereof through
August 31, 2016, the Borrowers shall be limited to capital expenditures of no
more than $757,193, which capital expenditures shall be incurred (i) in bringing
production back online and (ii) in accordance with the Borrowers’ projections
sent to the Administrative Agent on Friday, May 27, 2016.

 

4.2 Principal Payments. The Borrowers shall make payments of $37,500 to the
Administrative Agent in immediately available funds for application to the
principal of the Notes in accordance with the Credit Agreement (i) on the date
of execution of this Amendment and (ii) on June 30, 3016, except that the Banks
might waive the requirement of a June 30, 2016 principal payment if the
Administrative Agent has received from the Borrowers prior to such date a term
sheet acceptable to the Banks regarding the purchase of the Notes or an
injection of capital into the Borrowers.

 

4.3 Payment of Banks’ Legal Fees. The Borrowers shall pay to the Administrative
Agent on the date of execution of this Amendment, the legal fees and expenses of
counsel to each Bank incurred to the date of execution and delivery of this
Amendment if the Borrowers have been advised of the amount hereof.

 

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5.                  Notices. Notices to any party hereunder shall be given in
accordance with Section 10.02 of the Credit Agreement, at the addresses set
forth on the signatures pages hereto, except that any notice to the Borrowers
may also be given by any electronic means, including e-mail, to any electronic
address believed by the sender of such notice to be an address of any of the
Borrowers, or an officer of any of the Borrowers or legal counsel to the
Borrowers.

 

6.                  Governing Law; Venue; Waiver of Jury Trial and Exemplary
Damages. The provisions of Sections 7.4, 7.5 and 7.6 of the Forbearance
Agreement shall apply to this Amendment.

 

7.                  Invalid Provisions; Severability. If any provision of this
Amendment is held to be illegal, invalid or unenforceable under present or
future laws effective during the term hereof, such provision shall be fully
severable, this Amendment shall be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof, and the
remaining provisions hereof shall remain in full force and effect and shall not
be affected by the illegal, invalid or unenforceable provision or by its
severance herefrom. Furthermore, in lieu of such illegal, invalid or
unenforceable provision there shall be added automatically as a part of this
Amendment a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and be legal, valid and enforceable.

 

8.                  NO DEFENSES OF BORROWERS. Each of the Borrowers stipulates,
warrants, represents and agrees that, as of the date of execution of this
Amendment, it has no defenses against its obligations to pay any of the
Obligations or any other amount due and owing to the Administrative Agent or the
Banks pursuant to the Loan Documents. Each of the Borrowers acknowledges,
warrants and agrees that, to the best of its knowledge, the Administrative Agent
and each Bank have acted in good faith in all respects as to the Loan Documents
and this Amendment, and has conducted in a commercially reasonable manner its
relationships with the Borrowers in connection with the Loan Documents and this
Amendment, and the Borrowers hereby waive and release any claims to the
contrary.

 

9.                  RELEASE OF CLAIMS. Each of the Borrowers for itself, its
successors and assigns and all those at interest therewith (collectively, the
“Releasing Parties”), jointly and severally, hereby voluntarily and forever,
RELEASE, DISCHARGE AND ACQUIT the Administrative Agent, each Bank, and their
respective officers, directors, shareholders, employees, agents, successors,
assigns, representatives, affiliates and insurers (sometimes referred to below
collectively as the “Released Parties”) and all those at interest therewith of
and from any and all claims, causes of action, liabilities, damages, costs
(including, without limitation, attorneys’ fees and all costs of court or other
proceedings), and losses of every kind or nature at this time known or unknown,
direct or indirect, fixed or contingent, which the Releasing Parties have or
hereafter may have arising out of any act, occurrence, transaction or omission
occurring from the beginning of time to the date of execution of this Amendment
if related to the Notes, the Credit Agreement, the Forbearance Agreement or the
other Loan Documents (the “Released Claims”), except that (i) the future duties
and obligations of the Administrative Agent and the Banks under the Forbearance
Agreement (as amended by this Amendment) and the other Loan Documents, and the
rights of each Borrower to its funds on deposit with any Bank, shall not be
included in the term Released Claims and (ii) the right of the Borrower to
require the correction of manifest accounting errors and similar administrative
errors shall not be included in the term Released Claims. IT IS THE EXPRESS
INTENT OF THE RELEASING PARTIES THAT THE RELEASED CLAIMS SHALL INCLUDE ANY
CLAIMS OR CAUSES OF ACTION ARISING FROM OR ATTRIBUTABLE TO THE NEGLIGENCE, GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY OF THE RELEASED PARTIES.

 

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10.              No Commitment to Renew. By execution of this Amendment, each of
the Borrowers warrants and represents to the Administrative Agent and the Banks
and agree that there is no commitment of any party for a renewal, extension, or
modification of the Credit Agreement, the Notes, the Forbearance Period or this
Amendment in the future on any terms whatsoever.

 

11.              Statute of Limitations. The parties hereto agree that the
statute of limitations pertaining to the Credit Agreement, the Notes, the other
Loan Documents and the documents executed in connection therewith shall be
tolled during the Forbearance Period.

 

12.              Ratification. The Borrowers hereby ratify all of their
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 shall continue in full force and
effect after giving effect to this Amendment. Nothing in this Amendment
extinguishes, novates or releases any right, claim, Lien, security interest or
entitlement of the Administrative Agent or the Banks created by or contained in
any of such documents.

 

13.              No Waiver of Events of Default. The execution of this Amendment
shall not be construed as a waiver of any existing Default or Event of Default
under the Credit Agreement and the other Loan Documents.

 

14.              Costs; Expenses. In addition to other or similar rights granted
in the Credit Agreement and other Loan Documents, the Borrowers agree to pay on
demand all reasonable out-of-pocket costs and expenses of the Administrative
Agent and each Bank incurred in connection with the negotiation, preparation,
execution and delivery of this Amendment, including the reasonable fees and
disbursements and other charges of their respective counsel.

 

15.              Conditions to Effectiveness. This Amendment shall be effective
upon the execution and delivery by the Borrowers, the Administrative Agent and
the Banks.

 

16.              Counterparts. This Amendment may be executed in a number of
counterparts, each of which shall be an original and all of which together shall
constitute one and the same instrument. Delivery of an executed counterpart of a
signature page of this Amendment by telecopy, e-mail, facsimile or other
electronic means shall be effective as a delivery of a manually executed
counterpart of this Amendment.

 

17.              Effect. This Amendment is one of the Loan Documents.

 

(Signature page follows)

 

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18.              ENTIRE AGREEMENT. THIS AMENDMENT CONSTITUTES THE ENTIRE
AGREEMENT BETWEEN THE PARTIES HERETO WITH RESPECT TO THE SUBJECT HEREOF.
FURTHERMORE, IN THIS REGARD, THIS AMENDMENT AND THE OTHER WRITTEN LOAN DOCUMENTS
REPRESENT, COLLECTIVELY, THE FINAL AGREEMENT AMONG THE PARTIES THERETO AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF SUCH PARTIES.

 

THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG SUCH PARTIES.

 

IN WITNESS WHEREOF, this Amendment is deemed executed effective as of the date
first above written.

 

  BORROWERS:         ENERJEX RESOURCES, INC.       By:     Robert G. Watson    
Chief Executive Officer         ENERJEX KANSAS, INC.         By:     Robert G.
Watson     Chief Executive Officer         WORKING INTEREST, LLC         By:    
Robert G. Watson     Chief Executive Officer         BLACK SABLE ENERGY, LLC    
  By:       Robert G. Watson     Chief Executive Officer         BLACK RAVEN
ENERGY, INC.       By:       Robert G. Watson     Chief Executive Officer      
  ADENA, LLC         By:       Robert G. Watson     Chief Executive Officer

 

Signature Page to Second Amendment to Forbearance Agreement
(EnerJex Resources, Inc., et al)

 

 

 

 

  ADMINISTRATIVE AGENT AND L/C ISSUER:         TEXAS CAPITAL BANK, N.A.,   as
Administrative Agent, L/C Issuer and a Bank         By:     Name:     Title:    
      BANKS:         TEXAS CAPITAL BANK, N.A.,       By:     Name:     Title:  
        IBERIA BANK       By:     Name:     Title:  

 

Signature Page to Second Amendment to Forbearance Agreement
(EnerJex Resources, Inc., et al)