Exhibit 10.4

 

Execution Version

 

 

 

 

FIRST AMENDMENT
TO
CREDIT AGREEMENT

 

DATED AS OF
SEPTEMBER 30, 2011

 

AMONG

 

LRE OPERATING, LLC,

AS BORROWER,

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

AS ADMINISTRATIVE AGENT,

 

AND

 

THE LENDERS PARTY HERETO

 

 

 

 

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FIRST AMENDMENT TO CREDIT AGREEMENT

 

THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “First Amendment”) dated as of
September 30, 2011, is among LRE OPERATING, LLC, a Delaware limited liability
company (the “Borrower”); WELLS FARGO BANK, NATIONAL ASSOCIATION, as
administrative agent (in such capacity, together with its successors in such
capacity, the “Administrative Agent”) for the lenders party to the Credit
Agreement referred to below (collectively, the “Lenders”); and the undersigned
Lenders.

 

R E C I T A L S

 

A.            The Borrower, the Administrative Agent and the Lenders are parties
to that certain Credit Agreement dated as of July 22, 2011 (the “Credit
Agreement”), pursuant to which the Lenders shall make certain loans to, and
extensions of credit on behalf of, the Borrower.

 

B.            The Borrower and the Lenders have agreed to amend certain
provisions of the Credit Agreement as more fully described herein.

 

AGREEMENT

 

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 used herein, but
not otherwise defined herein has the meaning given such term in the Credit
Agreement.  Unless otherwise indicated, all references to Sections in this First
Amendment refer to Sections of the Credit Agreement.

 

Section 2.               Amendments to Credit Agreement.

 

2.1           Amendment to Section 2.07(b).  Section 2.07(b) is hereby amended
and restated in its entirety to read as follows:

 

“(b)         Scheduled and Interim Redeterminations.  The Borrowing Base shall
be redetermined semi-annually in accordance with this Section 2.07 (a “Scheduled
Redetermination”), and, subject to Section 2.07(d), such redetermined Borrowing
Base shall become effective and applicable to the Borrower, the Agents, the
Issuing Bank and the Lenders on May 1st and November 1st of each year,
commencing with a one-time redetermination on December 1, 2011, followed by
semi-annual redeterminations commencing on May 1, 2012.  In addition, the
Borrower may, by notifying the Administrative Agent thereof, and the
Administrative Agent may, at the direction of the Required Lenders, by notifying
the Borrower thereof, one time during any 6 month period, each elect to cause
the Borrowing Base to be redetermined between Scheduled Redeterminations (an
“Interim Redetermination”) in accordance with this Section 2.07.”

 

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2.2           Amendment to Section 6.01.  Section 6.01(s) and the paragraph
immediately following, but before Section 6.02, is hereby amended and restated
in its entirety to read as follows:

 

“(s)         The consummation of an offering and sale to the public of Equity
Interests consisting of common units in LRR Energy, L.P. pursuant to an
effective registration statement under the Securities Act filed on Form S-1, as
amended, shall have occurred.

 

The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. 
Notwithstanding the foregoing, the obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 12.02) at or prior to 2:00 p.m., New York City time, on
November 17, 2011 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).”

 

2.3           Amendment to Section 10.01.  Section 10.01(e) is hereby amended
and restated in its entirety to read as follows:

 

“(e)         any Loan Party shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those specified
in Section 10.01(a), Section 10.01(b) or Section 10.01(d)) or any other Loan
Document, and such failure shall continue unremedied for a period of 30 days
after the earlier to occur of (A) notice thereof from the Administrative Agent
to the Borrower (which notice will be given at the request of the Majority
Lenders) or (B) a Responsible Officer of the Borrower or such Subsidiary
otherwise becoming aware of such default.”

 

Section 3.               Conditions Precedent.  This First 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)
(the “Effective Date”):

 

3.1           Executed Counterparts of First Amendment.  The Administrative
Agent shall have received from the Lenders required by the Credit Agreement and
the Borrower, executed counterparts (in such number as may be requested by the
Administrative Agent) of this First Amendment.

 

3.2           Further Assurances.  The Administrative Agent shall have received
such other agreements, instruments, approvals, opinions and other documents,
each satisfactory to the Administrative Agent in form and substance, as the
Administrative Agent or special counsel to the Administrative Agent may
reasonably request.

 

3.3           No Defaults.  No Default or Event of Default shall have occurred
and be continuing, before and after giving effect to the terms of this First
Amendment.

 

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Section 4.               Miscellaneous.

 

4.1           Confirmation.  The provisions of the Credit Agreement, as amended
by this First Amendment, shall remain in full force and effect following the
effectiveness of this First Amendment.

 

4.2           Ratification and Affirmation; Representations and Warranties. 
Each of the Borrower and Parent hereby (a) acknowledges the terms of this First
Amendment; (b) ratifies and affirms its obligations under, and acknowledges,
renews and extends its continued liability under, each of the Loan Documents to
which it is a party and agrees that each of the Loan Documents 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, both before and after giving effect
to the terms of this First Amendment no Default has occurred and is continuing.

 

4.3           Loan Documents.  This First Amendment and each agreement,
instrument, certificate or document executed by the Borrower or any of its
officers in connection herewith are “Loan Documents” as defined and described in
the Credit Agreement and all of the terms and provisions of the Credit Agreement
relating to Loan Documents shall apply hereto and thereto.

 

4.4           Counterparts.  This First 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 an executed signature page of this First Amendment by
facsimile or electronic mail shall be effective as delivery of a manually
executed counterpart hereof; provided that, upon the request of any party
hereto, such facsimile transmission or electronic mail transmission shall be
promptly followed by the original thereof.

 

4.5           NO ORAL AGREEMENT.  THIS FIRST AMENDMENT, THE CREDIT AGREEMENT AND
THE OTHER LOAN DOCUMENTS EXECUTED IN CONNECTION HEREWITH AND THEREWITH REPRESENT
THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR UNWRITTEN ORAL AGREEMENTS OF THE PARTIES.  THERE ARE
NO ORAL AGREEMENTS AMONG THE PARTIES.

 

4.6           GOVERNING LAW.  THIS FIRST 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.

 

[SIGNATURES BEGIN NEXT PAGE]

 

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

 

BORROWER:

LRE OPERATING, LLC

 

 

 

By:

LRR Energy, L.P., its sole member

 

 

 

 

By:

LRE GP, LLC, its general partner

 

 

 

 

 

 

 

By:

/s/ Jaime R. Casas

 

Name:

Jaime R. Casas

 

Title:

Chief Financial Officer

 

 

 

 

 

 

PARENT:

LRR ENERGY, L.P.

 

 

 

By:

LRE GP, LLC, its general partner

 

 

 

 

 

 

 

By:

/s/ Jaime R. Casas

 

Name:

Jaime R. Casas

 

Title:

Chief Financial Officer

 

Signature Page

First Amendment to Credit Agreement

 

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ADMINISTRATIVE AGENT:

WELLS FARGO BANK, N. A.

 

as Administrative Agent, Issuing Bank, Swing Line Lender, and Lender

 

 

 

 

 

 

 

By:

/s/ Michael Real

 

Name:

Michael Real

 

Title:

Director

 

Signature Page

First Amendment to Credit Agreement

 

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SYNDICATION AGENT:

BANK OF AMERICA, N.A.

 

 

 

 

 

By:

/s/ Christopher T. Renyi

 

Name:

Christopher T. Renyi

 

Title:

Vice President

 

Signature Page

First Amendment to Credit Agreement

 

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JOINT LEAD ARRANGER:

WELLS FARGO SECURITIES, LLC

 

 

 

 

 

 

 

By:

/s/ R. Jeremy Burge

 

Name:

R. Jeremy Burge

 

Title:

Vice President

 

Signature Page

First Amendment to Credit Agreement

 

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JOINT LEAD ARRANGER:

MERRILL LYNCH, PIERCE, FENNER & SMITH, INC.

 

 

 

 

 

By:

/s/ David Banmiller

 

Name:

David Banmiller

 

Title:

Director

 

Signature Page

First Amendment to Credit Agreement

 

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CO- DOCUMENTATION AGENT:

BNP PARIBAS

 

 

 

 

 

 

 

By:

/s/ Richard Hawthorne

 

Name:

Richard Hawthorne

 

Title:

Director

 

 

 

 

 

 

 

By:

/s/ Betsy Jocher

 

Name:

Betsy Jocher

 

Title:

Director

 

Signature Page

First Amendment to Credit Agreement

 

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CO- DOCUMENTATION AGENT:

CITIBANK, N.A.

 

 

 

 

 

 

 

By:

/s/ John F. Miller

 

Name:

John F. Miller

 

Title:

Attorney-in-Fact

 

Signature Page

First Amendment to Credit Agreement

 

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CO- DOCUMENTATION AGENT:

ROYAL BANK OF CANADA

 

 

 

 

 

 

 

By:

/s/ Don J. McKinnerney

 

Name:

Don J. McKinnerney

 

Title:

Authorized Signatory

 

Signature Page

First Amendment to Credit Agreement

 

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LENDERS:

COMERICA BANK

 

 

 

 

 

By:

/s/ Paul J. Edmonds

 

Name:

Paul J. Edmonds

 

Title:

Vice President

 

Signature Page

First Amendment to Credit Agreement

 

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BARCLAYS BANK PLC

 

 

 

 

 

 

 

By:

/s/ May Huang

 

Name:

May Huang

 

Title:

Assistant Vice President

 

Signature Page

First Amendment to Credit Agreement

 

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AMEGY BANK NATIONAL ASSOCIATION

 

 

 

 

 

 

 

By:

/s/ Wakeford Thompson

 

Name:

Wakeford Thompson

 

Title:

Vice President

 

Signature Page

First Amendment to Credit Agreement

 

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