Exhibit 10.1

AMENDMENT AND WAIVER
OF THIRD AMENDED AND RESTATED CREDIT AGREEMENT

 

This AMENDMENT AND WAIVER OF THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this
“Amendment”), dated as of August 12, 2015, is among SANCHEZ PRODUCTION PARTNERS
LP, a Delaware limited partnership (the “Borrower”), the guarantors party hereto
(the “Guarantors”), each of the Lenders party hereto, and ROYAL BANK OF CANADA,
as administrative agent (in such capacity, the “Administrative Agent”), and as
collateral agent (in such capacity, the “Collateral Agent”), and relates to that
certain Third Amended and Restated Credit Agreement, dated as of March 31, 2015
(as amended, restated, modified or supplemented from time to time prior to the
date hereof, the “Existing Credit Agreement”; and as amended hereby, the “Credit
Agreement”), among the Borrower, the Lenders, the Administrative Agent, the
Collateral Agent, and ROYAL BANK OF CANADA, as letter of credit issuer.

WHEREAS, the Borrower has requested that the Administrative Agent and the
Lenders waive the Borrower’s non-compliance with the Maximum Total Net Debt to
Adjusted EBITDA ratio in Section 9.01(b) of the Credit Agreement for the fiscal
quarter ended June 30, 2015;

 

WHEREAS, subject to the terms and conditions of this Amendment, the Lenders, the
Administrative Agent, and the Borrower have agreed to enter into this Amendment
in order to effectuate certain waivers of and modifications to the Credit
Agreement, all as set forth herein;

 

NOW, THEREFORE, in consideration of the premises contained herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound hereby, agree as
follows:

 

Section 1. Definitions.  Unless otherwise defined in this Amendment, each
capitalized term used in this Amendment has the meaning assigned to such term in
the Credit Agreement.

Section 2. Limited Waiver.  At the request of the Borrower, the Administrative
Agent and the Lenders hereby waive any failure by the Borrower to comply with
Section 9.01(b) of the Credit Agreement for the fiscal quarter ended June 30,
2015, resulting solely from the Borrower’s inclusion of the general and
administrative expenses set forth on Schedule I hereto in calculating the
Maximum Total Net Debt to Adjusted EBITDA for such fiscal quarter, and any
Default or Event of Default arising as a result thereof, is hereby waived
effective as of the date of the occurrence thereof (and any related breach of a
representation or warranty is hereby similarly waived).

The waiver in this Section 2 is effective only in respect of the matters and for
the time periods expressly set forth in this Section 2 and not for any other
fiscal quarter period, and except as expressly set forth in this Amendment, no
other waivers, amendments or modifications are intended or made by this
Amendment.  No failure or delay on the part of the Administrative Agent or any
Lender in exercising any power or right under the Credit Agreement or any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right.  No waiver or approval by
the Administrative Agent or any Lender under this Amendment,

 

 

 

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the Credit Agreement or any other Loan Document shall, except as may be
otherwise stated herein, be applicable to any subsequent transaction or any
other Default or Event of Default under any Loan Document.

Section 3. Stipulation.  The Borrower, the Administrative Agent and the Lenders
hereby agree and acknowledge that the general and administrative expenses
incurred during the fiscal quarter ended June 30, 2015 and set forth on Schedule
I hereto, shall be excluded from the Borrower’s calculations of the Maximum
Total Net Debt to Adjusted EBITDA ratio for the fiscal quarters ending as of
September 30, 2015, December 31, 2015, and March 31, 2016.

Section 4. Ratification.  Except as expressly amended, modified or waived
herein, each of the Borrower and the Guarantors hereby ratifies and confirms all
of the Obligations under the Credit Agreement and the other Loan Documents to
which it is a party, and all references to the Credit Agreement in any of the
Loan Documents shall be deemed to be references to the Credit Agreement as
amended, modified or waived hereby and by the instruments and documents
delivered pursuant to Section 5.

Section 5. Effectiveness.  This Amendment shall become effective on the date
(the “Amendment Effective Date”) on which each of the following conditions is
satisfied:

the Administrative Agent shall have received counterparts of this Amendment
executed by the Administrative Agent, the Collateral Agent, the Borrower, the
Guarantors and the Required Lenders; and

the Borrower and each Guarantor shall have confirmed and acknowledged to the
Administrative Agent and the Lenders, and by its execution and delivery of this
Amendment the Borrower and each Guarantor do hereby confirm and acknowledge to
the Administrative Agent and the Lenders, that (i) the execution, delivery and
performance of this Amendment has been duly authorized by all requisite limited
partnership or limited liability company action, as applicable, on the part of
the Borrower or such Guarantor, as applicable; (ii) the Credit Agreement and
each other Loan Document to which it is a party constitute valid and legally
binding agreements enforceable against the Borrower or such Guarantor, as
applicable, in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws relating to or affecting
the enforcement of creditors’ rights generally and by general principles of
equity and (iii) no Default or Event of Default exists under the Credit
Agreement or any of the other Loan Documents after giving effect to this
Amendment.

Section 6. Governing Law.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

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Section 7. Miscellaneous. 

a)

On and after the Amendment Effective Date, each reference in the Credit
Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import,
referring to the Credit Agreement, and each reference in each other Loan
Document to “the Credit Agreement”, “thereunder”, “thereof” or words of like
import referring to the Credit Agreement, shall mean and be a reference to the
Existing Credit Agreement as amended or otherwise modified by this
Amendment.  This Amendment shall constitute a Loan Document for purposes of the
Credit Agreement.

b)

The execution, delivery and effectiveness of this Amendment shall not, except as
expressly provided herein, operate as a waiver of any other Default of the
Borrower  or any Guarantor or any right, power or remedy of the Administrative
Agent or the Lenders under any of the Loan Documents, nor constitute a waiver of
any provision of any of the Loan Documents.

c)

Each of the Borrower and each Guarantor represents and warrants that as of the
date hereof (i) it has the limited partnership or limited liability company, as
applicable, power and authority to execute, deliver and perform the terms and
provisions of this Amendment, has taken all necessary limited partnership or
limited liability company, as applicable, action to authorize the execution,
delivery and performance of this Amendment and the execution, delivery and
performance of this Amendment does not and will not contravene the terms of the
Borrower’s or such Guarantor’s, as applicable, organizational documents; (ii) it
has duly executed and delivered this Amendment and this Amendment constitutes
the legal, valid and binding obligation of the Borrower or such Guarantor
enforceable in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization and other similar laws
relating to or affecting creditors’ rights generally and general principles of
equity (whether considered in a proceeding in equity or law); (iii) except as
contemplated by this Amendment, no Default or Event of Default has occurred and
is continuing; and (iv) no action, suit, investigation or other proceeding is
pending or threatened before any arbitrator or Governmental Authority seeking to
restrain, enjoin or prohibit or declare illegal, or seeking damages from the
Borrower in connection with this Amendment or which could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect.

Section 8. Severability.  Any provisions of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provisions so held to be invalid.

Section 9. Successors and Assigns.  This Amendment is binding upon and shall
inure to the benefit of the Administrative Agent, the Collateral Agent, the
Lenders, the Issuer, the Borrower and each Guarantor and their respective
successors and assigns.

 

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Section 10. Counterparts.  This Amendment may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and
any of the parties hereto may execute this Amendment by signing any such
counterpart.  Delivery of an executed counterpart of a signature page to this
Amendment by telecopier or electronically by .pdf shall be effective as delivery
of a manually executed counterpart of this Amendment.

Section 11. Headings.  The headings, captions and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment or any other Loan Document.

Section 12. Integration.  This Amendment represents the final agreement of the
Borrower, each Guarantor, the Collateral Agent, the Administrative Agent, the
Issuer, and the Lenders with respect to the subject matter hereof, and there are
no promises, undertakings, representations or warranties by the Borrower, any
Guarantor, the Administrative Agent, the Collateral Agent, the Issuer, nor any
Lender relative to subject matter hereof not expressly set forth or referred to
herein.

[Signature Pages Follow]

 

 

 

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IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment to be
executed by its officer(s) thereunto duly authorized as of the date first above
written.

SANCHEZ PRODUCTION PARTNERS LP, as Borrower

By: Sanchez Production Partners GP LLC,

       as general partner

 

By:  /s/Charles C. Ward

Name:Charles C. Ward

Title: Chief Financial Officer

 

CEP MID-CONTINENT LLC,
as a Guarantor

 

By:/s/Charles C. Ward

Name:Charles C. Ward

Title: Chief Financial Officer

 

 

NORTHEAST SHELF ENERGY, L.L.C.,

as a Guarantor

 

 

By:/s/Charles C. Ward

Name:Charles C. Ward

Title: Chief Financial Officer

 

 

MID-CONTINENT OILFIELD SUPPLY, L.L.C.,

as a Guarantor

 

By:/s/Charles C. Ward

Name:Charles C. Ward

Title: Chief Financial Officer

 

SEP HOLDINGS IV, LLC,

as a Guarantor

 

By:/s/Charles C. Ward

Name:Charles C. Ward

Title: Chief Financial Officer

 

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ROYAL BANK OF CANADA,
as Administrative Agent and Collateral Agent

 

 

By:  /s/Yvonne Brazie
Name:  Yvonne Brazie
Title:    Manager, Agency

ROYAL BANK OF CANADA,
as a Lender and the Issuer

 

 

By:  /s/ Mark Lumpkin, Jr.
Name:  Mark Lumpkin, Jr.
Title:    Authorized Signatory

 

 

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SOCIÉTÉ GÉNÉRALE,
as a Lender

 

By:     /s/ Sal Patoli
Name:  Sal Patoli
Title:      Director 

 

 

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ONEWEST BANK N.A.,

as a Lender

 

 

By:     /s/ Zachary Holly
Name:  Zachary Holly
Title:   Vice  President

 

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COMPASS BANK,

as a Lender

 

 

By:     /s/ Les Werme
Name:  Les Werme
Title:    Director 

 

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SUNTRUST BANK,

as a Lender

 

 

By:     /s/ Chulley Bogle
Name:  Chulley Bogle
Title:   Vice President 

 

 

 

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Schedule I

 

General and Administrative Expenses

 

Item Description

Amount

CEO termination expenses (taxes on unit vesting)

$600,000

Board of Director fees for first quarter 2015

$123,000

2014 tax and K-1 preparation expenses

$152,000

Auditor and printer expenses for SEC filings

$131,000

Write-off of 2007 Form S-1 costs

$405,000

    Total

$1,411,000

 

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