Exhibit 10.7

FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT

This FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this
“Amendment”), dated effective as of February 11, 2010, is entered into by and
among CONSTELLATION ENERGY PARTNERS LLC, a Delaware limited liability company
(the “Borrower”), and the Lenders signatory hereto (the “Lenders”).

RECITALS

WHEREAS, the Borrower, the Lenders and The Royal Bank of Scotland plc, as
Administrative Agent and a Lender, are party to that certain Amended and
Restated Credit Agreement dated as of November 13, 2009 (such Amended and
Restated Credit Agreement, as the same may from time to time be amended,
modified, supplemented or restated, herein called the “Credit Agreement”). Terms
used and not otherwise defined herein shall have the respective meanings
assigned to such terms in the Credit Agreement, and the provisions of
Section 1.03 of the Credit Agreement are incorporated herein by reference; and

WHEREAS, the Borrower and the Lenders have agreed, subject to the terms and
conditions hereinafter set forth, to amend the Credit Agreement as set forth
below.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:

SECTION 1. Amendments to Credit Agreement. Pursuant to Section 12.02 of the
Credit Agreement, the Credit Agreement is hereby amended as follows:

(a) Section 1.02 of the Credit Agreement is hereby amended by inserting the
following definitions in alphabetical order:

““Aggregate Bond Exposure” means the aggregate face amount of all outstanding
Bonds (as defined in the Argonaut Indemnity Agreement) issued by Argonaut
Insurance Company for the benefit of the Borrower.

“Argonaut Indemnity Agreement” means the General Indemnity Agreement to be
entered into by and between the Borrower and Argonaut Insurance Company
(including any amendments, modifications or supplements thereto).”

(b) The following definitions in Section 1.02 of the Credit Agreement are hereby
deleted in their entirety and the following are substituted in place thereof:

““Loan Documents” means this Agreement, the Notes, the Letter of Credit
Arrangements, the Letters of Credit, any Swap Agreements with a Swap
Counterparty, and the Security Instruments.

“Swap Counterparty” means any Person that was a Lender (or Affiliate of a
Lender) at the time it became a party to a Swap Agreement with the Borrower or
any of its Subsidiaries.

“Total Revolving Credit Exposure” means the sum of (i) the aggregate of all
Revolving Credit Exposure hereunder and (ii) the Aggregate Bond Exposure.”

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(c) The definition of “Excepted Liens” in Section 1.02 of the Credit Agreement
is hereby amended by deleting the word “and” immediately preceding clause
(ix) thereof and inserting the following immediately following clause
(ix) thereof:

“; and (x) Liens granted by the Borrower in favor of Argonaut Insurance Company
under the Argonaut Indemnity Agreement, provided that such Liens may not secure
Aggregate Bond Exposure in excess of $3,000,000 in the aggregate at any one time
outstanding”

(d) Section 8.01 of the Credit Agreement is hereby amended by inserting the
following Section 8.01(r):

“(r) Argonaut Insurance Company Bonds. The Borrower shall provide a monthly
report by the fifteenth (15th) day of each month in a form reasonably acceptable
to the Administrative Agent setting forth a description all Bonds (as defined in
the Argonaut Indemnity Agreement) then outstanding and the face amounts
thereof.”

(e) Section 9.02 of the Credit Agreement is hereby amended by deleting the word
“and” at the end of Section 9.02(d), replacing the period at the end of
Section 9.02(e) with a semicolon, and inserting the following Section 9.02(f):

“and (f) Debt incurred pursuant to the Argonaut Indemnity Agreement not to
exceed $3,000,000 in the aggregate at any one time outstanding.”

SECTION 2. No Default. The Borrower represents and warrants as follows:

(a) The Borrower is duly authorized and empowered to execute, deliver and
perform this Amendment and all other instruments referred to or mentioned herein
to which it is a party, and all action on its part requisite for the due
execution, delivery and the performance of this Amendment has been duly and
effectively taken.

(b) After giving effect to this Amendment, the representations and warranties
contained in the Credit Agreement, as amended hereby, and any other Loan
Documents executed in connection herewith or therewith are true in all material
respects on and as of the date hereof as though made on and as of the date
hereof, except to the extent that such representation or warranty was made as of
a specific date, in which case such representation or warranty was true in all
material respects when made.

(c) After giving effect to this Amendment, no event has occurred and is
continuing which constitutes a Default.

(d) When duly executed and delivered, the Credit Agreement as amended by this
Amendment will be legal and binding obligations of the Borrower, enforceable in
accordance with their respective terms, except as limited by bankruptcy,
insolvency or similar laws of general application relating to the enforcement of
creditors’ rights and by equitable principles of general application.

SECTION 3. Conditions to Effectiveness. This Amendment shall become effective as
of the date first written above, and it shall be a condition to the
effectiveness of this Amendment that the Administrative Agent shall have
received counterparts of this Amendment, duly executed and delivered on behalf
of the Borrower and the Required Lenders.

SECTION 4. Reference to and Effect on Loan Documents.

(a) On and after the effective date of this Amendment, each reference in the
Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or any
other expression of like import referring to the Credit Agreement, and each
reference in the other Loan Documents to “the Credit Agreement,” “thereunder,”
“thereof,” “therein” or any other expression of like import referring to the
Credit Agreement, shall mean and be a reference to the Credit Agreement as
amended by this Amendment.

 

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(b) Except as specifically amended above, the Credit Agreement and the other
Loan Documents shall remain in full force and effect and are hereby ratified and
confirmed. Without limiting the generality of the foregoing, the Security
Instruments and all of the Collateral described therein do and shall continue to
secure the payment of all obligations stated to be secured thereby under the
Credit Agreement, as amended hereby, and the other Loan Documents.

(c) The execution, delivery and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of the Lenders under any of
the Loan Documents or constitute a waiver of any provision of any of the Loan
Documents.

SECTION 5. Execution in Counterparts. This Amendment may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed to be an original and
all of which taken together shall constitute one and the same agreement.

SECTION 6. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE
CHOICE OF LAW PRINCIPLES THEREOF.

SECTION 7. Costs and Expenses. The Borrower agrees to pay on demand all out of
pocket costs and expenses of the Administrative Agent in connection with the
preparation, reproduction, execution and delivery of this Amendment and the
other instruments and documents to be delivered hereunder, including reasonable
legal fees and expenses for counsel for the Administrative Agent.

[Signature pages follow]

 

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The parties hereto have caused this Amendment to be executed by their respective
duly authorized representatives as of the date first written above.

 

    CONSTELLATION ENERGY PARTNERS LLC       By:   /s/ CHARLES C. WARD        
Charles C. Ward, Chief Financial Officer     THE ROYAL BANK OF SCOTLAND plc, as
a Lender

26.829268% of Outstanding Principal

Amount of the Loans

    By:   /S/ PHILLIP R. BALLARD       Phillip R. Ballard, Managing Director    
THE BANK OF NOVA SCOTIA, as a Lender

21.951220% of Outstanding Principal

Amount of the Loans

    By:   /S/ DAVID MILLS    

Name:

Title:

 

David Mills

Managing Director

    BNP PARIBAS, as a Lender

21.951220% of Outstanding Principal

Amount of the Loans

    By:   /S/ EDWARD PAK    

Name:

Title:

 

Edward Pak

Vice President

    By:   /S/ BETSY JOCHER    

Name:

Title:

 

Betsy Jocher

Director

    WELLS FARGO BANK, N.A., as a Lender

14.634146% of Outstanding Principal

Amount of the Loans

    By:   /s/ LEANNE S. PHILLIPS    

Name:

Title:

 

Leanne S. Phillips

Sr. Portfolio Manager

    SOCIÉTÉ GÉNÉRALE, as a Lender

14.634146% of Outstanding Principal

Amount of the Loans

    By:   /S/ KEVIN C. JOYCE    

Name:

Title:

 

Kevin C. Joyce

Vice President