FOURTH AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Fourth
Amendment”) is entered into and effective as of the Fourth Amendment Closing
Date (as defined below) among ENERJEX RESOURCES, INC., a Nevada corporation
(“Parent”), ENERJEX KANSAS, INC. (f/k/a Midwest Energy, Inc.), a Nevada
corporation (“EnerJex Kansas”), DD ENERGY, INC., a Nevada corporation (“DD
Energy”), Working Interest, LLC, a Kansas limited liability company (“Working
Interest”) and BLACK SABLE ENERGY, LLC, a Texas limited liability company
(“Black Sable”) (each, a “Borrower” and, collectively, “Borrowers”) 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”). Capitalized terms used but not
defined in this Fourth Amendment have the meaning given them in the Credit
Agreement.

 

RECITALS

 

A.           Borrowers, Administrative Agent, L/C Issuer and Banks previously
entered into that certain Amended and Restated Credit Agreement dated as of
October 3, 2011 (as amended by the First Amendment thereto dated December 14,
2011 (the “First Amendment”), the Second Amendment thereto dated August 31,
2012, the Third Amendment thereto dated November 2, 2012 and as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”).

 

B.           Pursuant to the Credit Agreement, Borrowers previously executed and
delivered an Amended and Restated Note dated October 3, 2011, payable to the
order of each Bank in the face principal amount of Fifty Million and No/100
Dollars ($50,000,000) and certain other Loan Documents.

 

C.           Parent previously entered into the Contribution Agreement by and
among Rantoul, Parent and the Rantoul Investors, pursuant to which EnerJex
Kansas contributed the Rantoul Project Assets to Rantoul in order to enable
Rantoul to develop such Rantoul Project Assets.

 

D.           In accordance with the Contribution Agreement, EnerJex Kansas
previously assigned, conveyed, transferred and contributed all of its right,
title and interest in and to the Rantoul Project Assets to Rantoul (the “Rantoul
Assignment”).

 

E.           In consideration of the Rantoul Assignment, Rantoul issued certain
partnership interests to EnerJex Kansas which were immediately thereafter
assigned to Parent such that (a) Rantoul became a Subsidiary of Parent and (b)
Parent became Rantoul’s managing partner.

 

F.           Pursuant to the First Amendment and other Loan Documents executed
and delivered in connection therewith, (a) Rantoul became a Guarantor pursuant
to a Limited Guaranty, (b) Rantoul granted Liens (and assumed, ratified and
confirmed the existing Liens on the Rantoul Project Assets) to the extent of
Parent’s Beneficial Interest, and (c) Parent granted a Lien on all of Parent’s
Rantoul partnership interests.

 

 

 

 

G.           In accordance with the Rantoul GP Agreement, the Rantoul Partners
desire to (a) dissolve Rantoul (the “Rantoul Dissolution”) and (b) distribute
(or cause the distribution of) the Rantoul Assets to each Rantoul Partner (or
its designee) (the “Rantoul Distribution”) in accordance with each Rantoul
Investors’ Final Beneficial Interest Percentage (as defined below).

 

H.           In connection with the Rantoul Distribution, Parent desires to
assign, convey and transfer Parent’s Final Beneficial Interest (as defined
below) to Working Interest pursuant to that certain Assignment of Assets dated
as of the Fourth Amendment Closing Date (the “Working Interest Assignment”).

 

I.           Borrowers have requested that Administrative Agent and Banks
consent to the Rantoul Dissolution, the Rantoul Distribution and the Working
Interest Assignment.

 

J.           Administrative Agent and Banks desire to consent to the Rantoul
Dissolution, the Rantoul Distribution and the Working Interest Assignment (such
transactions, collectively, the “Restructuring Transactions”) subject to Working
Interest granting Liens to the extent of Parent’s Final Beneficial Interest in
and to the assets under the Working Interest Assignment.

 

K.          Borrowers, Administrative Agent, L/C Issuer and Banks have agreed to
amend the Credit Agreement, subject to the terms and conditions of this Fourth
Amendment.

 

AGREEMENT

 

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are acknowledged, the undersigned hereby agree as follows:

 

I.            Specific Amendments to Credit Agreement.

 

A.           Article I, Definitions, of the Credit Agreement is hereby amended
by adding the following definitions in their proper alphabetical order:

 

“Fourth Amendment” means the Fourth Amendment to Amended and Restated Credit
Agreement dated effective as of the Fourth Amendment Closing Date by and among
Borrowers, Administrative Agent, L/C Issuer and Banks.

 

“Fourth Amendment Closing Date” means December __, 2012.

 

“Parent’s Final Beneficial Interest” means Parent’s beneficial ownership of the
Rantoul Assets calculated based on Parent’s Final Beneficial Interest
Percentage.

 

“Parent’s Final Beneficial Interest Percentage” means seventy-five percent
(75%).

 

“Rantoul Dissolution” is defined in Recital G to the Fourth Amendment.

 

“Rantoul Distribution” is defined in Recital G to the Fourth Amendment.

 

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“Rantoul Investors’ Final Beneficial Interest” means the Rantoul Investors’
Beneficial Interest calculated based on the Rantoul Investors’ Final Beneficial
Interest Percentage.

 

“Rantoul Investors’ Final Beneficial Interest Percentage” means twenty-five
percent (25%).

 

“Restructuring Transactions” is defined in Recital J to the Fourth Amendment.

 

“Working Interest Assignment” is defined in Recital H to the Fourth Amendment.

 

II.           Schedule 5.13. Upon satisfaction of all conditions precedent set
forth in Article IV of this Fourth Amendment, Schedule 5.13 attached to the
Credit Agreement is hereby deleted in its entirety and replaced with Schedule
5.13 attached to this Fourth Amendment and each reference in the Loan Documents
to such Schedule 5.13 shall be deemed to refer to Schedule 5.13 attached to this
Fourth Amendment.

 

III.          Consent to Certain Transactions. Subject to the terms of this
Fourth Amendment, Administrative Agent and Banks hereby consent to (a) the
Restructuring Transactions, including, without limitation, the Rantoul
Dissolution, the Rantoul Distribution, and the Working Interest Assignment and
(b) the termination of the Limited Guaranty executed by Rantoul in favor of
Administrative Agent and Banks.

 

IV.          Conditions Precedent to Fourth Amendment. This Fourth Amendment
shall be effective once each of the following conditions have been satisfied in
Administrative Agent’s sole discretion on or before the Fourth Amendment Closing
Date:

 

(a)          Borrowers, Administrative Agent and Banks shall have executed and
delivered this Fourth Amendment (including, without limitation, all schedules,
exhibits and annexes to be attached hereto and incorporated herein);

 

(b)          Working Interest shall have executed and delivered an amendment to
the Collateral Documents granting a Lien in and to the Rantoul Assets assigned
to Working Interest pursuant to the Working Interest Assignment and any other
Collateral Documents that Administrative Agent may reasonably request;

 

(c)          Borrowers shall have delivered executed copies of the Working
Interest Assignment and evidence of the Rantoul Dissolution, each in form and
content satisfactory to Administrative Agent;

 

(d)          Borrowers shall have delivered to Administrative Agent such other
documents as Administrative Agent may request, including without limitation,
partnership resolutions of Rantoul authorizing and acknowledging the
Restructuring Transaction, in each case, in form and content satisfactory to
Administrative Agent; and

 

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(e)          Administrative Agent shall have received, in form and content
satisfactory to it, such other assurances, certificates, documents or consents
related to the foregoing as Administrative Agent may request.

 

V.          Representations, Warranties and Covenants. Borrowers represent and
warrant to Administrative Agent and Banks that (a) they possess all requisite
Corporate Power and authority to execute, deliver and comply with the terms of
this Fourth Amendment and the Restructuring Transactions, (b) this Fourth
Amendment and the Restructuring Transactions have been duly authorized and
approved by all requisite Corporate Action on the part of the Borrowers, (c) no
other consent of any Person (other than Administrative Agent and Banks) is
required for this Fourth Amendment and the Restructuring Transactions to be
effective, (d) the execution and delivery of this Fourth Amendment and the
Restructuring Transactions does not violate their Governing Documentation, (e) 
the representations and warranties in each Loan Document to which they are a
party are true and correct in all material respects on and as of the Fourth
Amendment Closing Date as though made on the Fourth Amendment Closing Date, (f) 
they are in full compliance with all covenants and agreements contained in each
Loan Document to which they are a party, (g) no Event of Default or Default has
occurred and is continuing, and (h) except as may be addressed in this Fourth
Amendment, no exhibit or schedule to the Credit Agreement is required to be
supplemented, amended or modified in connection with the transactions
contemplated by this Fourth Amendment or any other matters occurring prior to
the Fourth Amendment Closing Date. In particular, but without limiting the
generality of the foregoing, Exhibit A attached to the Credit Agreement, as
amended by this Fourth Amendment or any prior amendment, describes all of
Borrowers’ Borrowing Base Oil and Gas Properties. The representations and
warranties made in this Fourth Amendment shall survive the execution and
delivery of this Fourth Amendment. No investigation by Administrative Agent or
any Bank is required for Administrative Agent or any Bank to rely on the
representations and warranties in this Fourth Amendment.

 

VI.          Scope of Amendment; Reaffirmation; Release. All references to the
Credit Agreement shall refer to the Credit Agreement as amended by this Fourth
Amendment. Except as affected by this Fourth Amendment, the Loan Documents are
unchanged and continue in full force and effect. However, in the event of any
inconsistency between the terms of the Credit Agreement (as amended by this
Fourth Amendment) and any other Loan Document, the terms of the Credit Agreement
shall control and such other document shall be deemed to be amended to conform
to the terms of the Credit Agreement. Borrowers hereby reaffirm their
obligations under the Loan Documents to which they are a party to and agree that
all Loan Documents to which they are a party to remain in full force and effect
and continue to be legal, valid, and binding obligations enforceable in
accordance with their terms (as the same are affected by this Fourth Amendment).
Borrowers hereby release, discharge and acquit Administrative Agent, L/C Issuer
and Banks from any and all claims, demands, actions, causes of action, remedies,
and liabilities of every kind or nature (including without limitation, offsets,
reductions, rebates, or lender liability) arising out of any act, occurrence,
transaction or omission occurring in connection with the Credit Agreement and
the other Loan Documents prior to the Fourth Amendment Closing Date.

 

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VII.       Miscellaneous.

 

(a)          No Waiver of Defaults. This Fourth Amendment does not constitute
(i) a waiver of, or a consent to, (A) any provision of the Credit Agreement or
any other Loan Document, or (B) any present or future violation of, or default
under, any provision of the Loan Documents, or (ii) a waiver of Administrative
Agent’s or any Bank’s right to insist upon future compliance with each term,
covenant, condition and provision of the Loan Documents.

 

(b)          Form. Each agreement, document, instrument or other writing to be
furnished to Administrative Agent under any provision of this Fourth Amendment,
if any, must be in form and substance satisfactory to Administrative Agent and
its counsel.

 

(c)          Headings. The headings and captions used in this Fourth Amendment
are for convenience only and will not be deemed to limit, amplify or modify the
terms of this Fourth Amendment, the Credit Agreement, or the other Loan
Documents.

 

(d)          Costs, Expenses and Attorneys’ Fees. Borrowers agree to pay or
reimburse Administrative Agent on demand for all its reasonable out-of-pocket
costs and expenses incurred in connection with the preparation, negotiation, and
execution of this Fourth Amendment, including, without limitation, the
reasonable fees and disbursements of Administrative Agent’s counsel.

 

(e)          Successors and Assigns. This Fourth Amendment shall be binding upon
and inure to the benefit of each of the undersigned and their respective
successors and permitted assigns.

 

(f)          Multiple Counterparts. This Fourth Amendment may be executed in any
number of counterparts with the same effect as if all signatories had signed the
same document. All counterparts must be construed together to constitute one (1)
and the same instrument. This Fourth Amendment may be transmitted and signed by
facsimile or portable document file (pdf). The effectiveness of any such
documents and signatures shall, subject to applicable law, have the same force
and effect as manually-signed originals and shall be binding on Borrowers,
Administrative Agent, L/C Issuer and Banks. Administrative Agent may also
require that any such documents and signatures be confirmed by a manually-signed
original; provided that the failure to request or deliver the same shall not
limit the effectiveness of any facsimile document or signature.

 

(g)          Governing Law. This FOURTH Amendment and the other Loan Documents
must be construed, and their performance enforced, under Texas law.

 

(h)          Entirety. The Loan Documents (as amended hereby) Represent the
Final Agreement By and Among Borrowers, Administrative Agent, L/C Issuer and
Banks and May Not Be Contradicted by Evidence of Prior, Contemporaneous, or
Subsequent Oral Agreements by the Parties. There Are No Unwritten Oral
Agreements between the Parties.

 

(Signature pages follow)

 

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IN WITNESS WHEREOF, this Fourth Amendment is executed effective as of the Fourth
Amendment Closing Date.

  

BORROWERS:           ENERJEX RESOURCES, INC.           By:          Robert G.
Watson, Jr.       Chief Executive Officer             ENERJEX KANSAS, INC.      
      By:         Robert G. Watson, Jr.       Chief Executive Officer          
  DD ENERGY, INC.             By:          Robert G. Watson, Jr.       Chief
Executive Officer             WORKING INTEREST, LLC             By:        
Robert G. Watson, Jr.       Chief Executive Officer             – and –        
    BLACK SABLE ENERGY, LLC             By:          Robert G. Watson, Jr.      
Chief Executive Officer

 

Signature Page to Fourth Amendment

 

 

 

 

    ADMINISTATIVE AGENT, L/C ISSUER
AND BANKS:           TEXAS CAPITAL BANK, N.A.,     as Administrative Agent, L/C
Issuer and     a Bank           By:          W. David McCarver IV       Senior
Vice President

  

Signature Page to Fourth Amendment

 

 

 

 

SCHEDULE 5.13

 

SUBSIDIARIES

 

Subsidiaries of EnerJex Resources, Inc.

 

1.EnerJex Kansas, Inc.

2.DD Energy, Inc.

3.Working Interest, LLC

4.Black Sable Energy, LLC

 

Subsidiaries of EnerJex Kansas, Inc.

 

None.

 

Subsidiaries of DD Energy, Inc.

 

None.

 

Subsidiaries of Working Interest, LLC

 

None.

 

Subsidiaries of Black Sable Energy, LLC

 

None.

 

Schedule 5.13