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Exhibit 10.1
Execution Version

__________________________________________________________________________________________

Third Amendment

to

Amended and Restated Credit Agreement

Dated as of April 17, 2009

among

McMoran Exploration Co.,
As Parent,

McMoran Oil & Gas LLC,
as Borrower,

The Guarantors,

JPMorgan Chase Bank, N.A.
as Administrative Agent,

GE Business Financial Services Inc.,
fka Merrill Lynch Business Financial Services Inc.
as Syndication Agent,
 
Toronto Dominion (Texas) LLC, BNP Paribas,
and ING Capital LLC,
as Documentation Agents,

and

The Lenders Party Hereto

____________________________________________________________________________________________

 
 

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Third Amendment To Amended and Restated Credit Agreement
 
THIS Third Amendment to Amended and Restated Credit Agreement (this “Third
Amendment”) dated as of April 17, 2009, is among McMoran Exploration Co., a
Delaware corporation (the “Parent”), McMoran Oil & Gas LLC, a Delaware limited
liability company (the “Borrower”), the undersigned guarantors (the
“Guarantors”, and together with the Parent and the Borrower, the “Obligors”),
each of the lenders party to the Credit Agreement referred to below
(collectively, the “Lenders”), JPMorgan Chase Bank, N.A., as administrative
agent for the Lenders (in such capacity, together with its successors in such
capacity, the “Administrative Agent”), GE Business Financial Services Inc., fka
Merrill Lynch Business Financial Services Inc., as syndication agent for the
Lenders (in such capacity, together with its successors in such capacity, the
“Syndication Agent”), and The Toronto Dominion (Texas) LLC, BNP Paribas, and ING
Capital LLC, as co-documentation agents for the Lenders (in such capacity,
together with its successors in such capacity, each a “Documentation Agent”).
 
R E C I T A L S
 
A.           The Borrower, the Agents and the Lenders are parties to that
certain Amended and Restated Credit Agreement dated as of August 6, 2007 (as
amended by the First Amendment to Amended and Restated Credit Agreement dated
June 20, 2008, the Second Amendment to Amended and Restated Credit Agreement
dated September 10, 2008, and as further amended from time to time, 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
Required Lenders have agreed to amend certain provisions of the Credit
Agreement.
 
C.           NOW, THEREFORE, to induce the Administrative Agent and the Lenders
to enter into this Third Amendment and 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 used herein but not otherwise
defined herein has the meaning given such term in the Credit Agreement, as
amended by this Third Amendment.  Unless otherwise indicated, all section
references in this Third Amendment refer to sections of the Credit Agreement.
 
Section 2. Amendments to Credit Agreement.
 
2.1 Amendments to Section 1.02.
 
(a) The following definitions are hereby added where alphabetically appropriate
to read as follows:
 
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“Defaulting Lender” means any Lender, as determined by the Administrative Agent,
that has (a) failed to fund any portion of its Loans or participations in
Letters of Credit within three (3) Business Days of the date required to be
funded by it hereunder, (b) notified the Borrower, the Administrative Agent, the
Issuing Bank or any Lender in writing that it does not intend to comply with any
of its funding obligations under this Agreement or has made a public statement
to the effect that it does not intend to comply with its funding obligations
under this Agreement, (c) failed, within three (3) Business Days after request
by the Administrative Agent, to confirm that it will comply with the terms of
this Agreement relating to its obligations to fund prospective Loans and
participations in then outstanding Letters of Credit, (d) otherwise failed to
pay over to the Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within three (3) Business Days of the date
when due, unless the subject of a good faith dispute, or (e) become the subject
of a bankruptcy or insolvency proceeding, or has had a receiver, conservator,
trustee or custodian appointed for it, or has taken any action in furtherance
of, or indicating its consent to, approval of or acquiescence in any such
proceeding or appointment or has a parent company that has become the subject of
a bankruptcy or insolvency proceeding, or has had a receiver, conservator,
trustee or custodian appointed for it, or has taken any action in furtherance
of, or indicating its consent to, approval of or acquiescence in any such
proceeding or appointment.
 
“Third Amendment” means that certain Third Amendment to Amended and Restated
Credit Agreement, dated as of April 17, 2009, among the Parent, the Borrower,
the Guarantors, the Administrative Agent and the Lenders party thereto.
 
(b) The following definitions are hereby amended by deleting such definitions in
their entirety and replacing them with the following:
 
“Agreement” means this Amended and Restated Credit Agreement, as amended by the
First Amendment, the Second Amendment and the Third Amendment, including the
Schedules and Exhibits hereto, as the same may be amended or supplemented from
time to time.
 
“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus ½ of 1% or (c) the Adjusted LIBO Rate having an
Interest Period of one month on such day plus 1%.  Any change in the Alternate
Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or
the Adjusted LIBO Rate shall be effective from and including the effective date
of such change in the Prime Rate, the Federal Funds Effective Rate or the
Adjusted LIBO Rate, respectively.
 
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“Applicable Margin” means, for any day, with respect to any ABR Loan or
Eurodollar Loan, as the case may be, the applicable rate per annum set forth
below based upon the Borrowing Base Utilization Percentage then in effect:
 
Borrowing
Base Utilization Percentage
Eurodollar
Loans
ABR
Loans
> 90%
3.25%
2.25%
> 75% and < 90%
3.00%
2.00%
> 50% and < 75%
2.75%
1.75%
< 50%
2.50%
1.50%

 
Each change in the Applicable Margin shall apply during the period commencing on
the effective date of a change in the Borrowing Base Utilization Percentage and
ending on the date immediately preceding the effective date of the next such
change, provided, however, that if at any time the Borrower fails to deliver a
Reserve Report pursuant to Section 8.12(a), then the “Applicable Margin” means
the rate per annum set forth on the grid when the Borrowing Base Utilization
Percentage is at its highest level.
 
 
“Commitment Fee Rate” means, for any day, a rate per annum equal to 0.50%.
 
2.2 Amendment to Section 2.08.  The following Subsection (l) shall be added to
the end of Section 2.08:
 
(l)           Defaulting Lenders.  Notwithstanding any provision of this
Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the
following provisions shall apply for so long as such Lender is a Defaulting
Lender:
(i)           if any LC Exposure exists at the time a Lender is a Defaulting
Lender, the Borrower shall, within one Business Day following notice by the
Administrative Agent, cash collateralize such Defaulting Lender’s LC Exposure in
accordance with the procedures set forth in Section 2.08(j) for so long as such
LC Exposure is outstanding; and

(ii)           the Issuing Bank shall not be required to issue, amend or
increase any Letter of Credit unless it is satisfied that cash collateral will
be provided by the Borrower in accordance with Section 2.08(l)(i);

provided that the foregoing shall not affect the Borrower’s rights under Section
5.05.  The rights and remedies against a Defaulting Lender under this Section
2.08 are in addition to other rights and remedies that the Borrower, the
Administrative Agent or any other Lender may have
 
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against such Defaulting Lender with respect to any funding default.

Section 3. Borrowing Base.  For the period from and including April 17, 2009
until the next Redetermination Date, the Borrowing Base is
$235,000,000.  Notwithstanding the foregoing, the Borrowing Base may be subject
to further adjustments from time to time pursuant to Section 8.13, Section
9.11(d) or Section 9.18.
 
Section 4. Conditions Precedent.  This Third Amendment shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 12.02 of the Credit Agreement):
 
4.1 The Administrative Agent shall have received from each of the Required
Lenders, the Parent, the Borrower and the Guarantors, counterparts (in such
number as may be requested by the Administrative Agent) of this Third Amendment
signed on behalf of such Person.
 
4.2 The Administrative Agent and the Lenders shall have received all fees and
other amounts due and payable on or prior to the date hereof.
 
4.3 No Default shall have occurred and be continuing as of the date hereof,
after giving effect to the terms of this Third Amendment.
 
The Administrative Agent is hereby authorized and directed to declare this Third
Amendment to be effective when it has received documents confirming or
certifying, to the satisfaction of the Administrative Agent, compliance with the
conditions set forth in this Section 4 or the waiver of such conditions as
permitted hereby. Such declaration shall be final, conclusive and binding upon
all parties to the Credit Agreement for all purposes.
 
Section 5. Miscellaneous.
 
5.1 Confirmation.  The provisions of the Credit Agreement, as amended by this
Third Amendment, shall remain in full force and effect following the
effectiveness of this Third Amendment.
 
5.2 Ratification and Affirmation; Representations and Warranties.  Each Obligor
hereby (a) acknowledges the terms of this Third Amendment; (b) ratifies and
affirms its obligations under, and acknowledges, renews and extends its
continued liability under, each Loan Document to which it is a party and agrees
that each Loan Document to which it is a party remains in full force and effect,
except as expressly amended hereby, notwithstanding the amendments contained
herein and (c) represents and warrants to the Lenders that as of the date
hereof, after giving effect to the terms of this Third Amendment:  (i) all of
the representations and warranties contained in each Loan Document to which it
is a party are true and correct, 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, (ii) no Default or Event of Default has occurred and is
continuing
 
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and (iii) no event or events have occurred which individually or in the
aggregate could reasonably be expected to have a Material Adverse Effect.
 
5.3 Counterparts.  This Third 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.  Delivery of this Third Amendment by facsimile transmission shall be
effective as delivery of a manually executed counterpart hereof.
 
5.4 NO ORAL AGREEMENT.  THIS THIRD 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 THIRD AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
 
5.6 Payment of Expenses.  In accordance with Section 12.03 of the Credit
Agreement, the Borrower agrees to pay or reimburse the Administrative Agent for
all of its reasonable out-of-pocket costs and reasonable expenses incurred in
connection with this Third Amendment, any other documents prepared in connection
herewith and the transactions contemplated hereby, including, without
limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent.
 
5.7 Severability.  Any provision of this Third Amendment which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
 
5.8 Successors and Assigns.  This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns.
 

[SIGNATURE PAGES BEGIN NEXT PAGE]

 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to be
duly executed as of the date first written above.
 
BORROWER:                                                                                     
MCMORAN OIL & GAS LLC
 
By:           /s/ Kathleen L. Quirk
Kathleen L. Quirk, Vice President

PARENT:                                                                               
             MCMORAN EXPLORATION CO.
 
By:           /s/ Kathleen L. Quirk
Kathleen L. Quirk, Senior Vice
President & Treasurer

GUARANTORS:                                                                                   K-MC
VENTURE I LLC

By:           MCMORAN OIL & GAS LLC,
its sole member

By:           /s/ Kathleen L. Quirk
Kathleen L. Quirk, Vice President

FREEPORT CANADIAN
EXPLORATION COMPANY

By:           MCMORAN OIL & GAS LLC,
its sole member

By:           /s/ Kathleen L. Quirk
Kathleen L. Quirk, Vice President

MCMORAN INTERNATIONAL INC.

By:           MCMORAN OIL & GAS LLC,
its sole member

By:           /s/ Kathleen L. Quirk
Kathleen L. Quirk, Vice President

Signature Page
Third Amendment
 
 

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 JPMORGAN CHASE BANK, N.A.
as Administrative Agent and as a Lender

By:           /s/ Jo Linda Papadakis
Name:                      Jo Linda Papadakis
Title:                      Vice President

Signature Page
Third Amendment
 
 

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GE BUSINESS FINANCIAL SERVICES
INC., fka Merrill Lynch Business Financial Services
Inc., as Syndication Agent and as
a Lender

By:        /s/ Matthew A. Toth III
Name:         Matthew A. Toth III
Title:           Divisional President
 

Signature Page
Third Amendment
 
 

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BNP PARIBAS, as a Documentation Agent
and as a Lender

By:        /s/ Douglas R. Liftman
Name:         Douglas R. Liftman
Title:           Managing Director

By:        /s/ Polly Schott
Name:         Polly Schott
Title:           Director

Signature Page
Third Amendment
 
 

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TORONTO DOMINION (TEXAS) LLC, as
a Documentation Agent and as a Lender

By:       /s/ Ian Murray
Name:        Ian Murray
Title:          Authorized Signatory

Signature Page
Third Amendment
 
 

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ING CAPITAL LLC, as a Documentation
Agent and as a Lender

By:       /s/ Charles Hall
Name:        Charles Hall
Title:          Managing Director

Signature Page
Third Amendment
 
 

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U.S. BANK NATIONAL ASSOCIATION, as a Lender

By:____/s/ Mark E. Thompson___________
Name:  Mark E. Thompson
 
Title:  Senior Vice President

Signature Page
Third Amendment
 
 

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CAPITAL ONE, N.A., as a Lender

By:        /s/ David R. Reid
Name:         David R. Reid
Title:           Senior Vice President

Signature Page
Third Amendment
 
 

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