Filed by Bowne Pure Compliance





Exhibit 10.3




EXECUTION VERSION




AMENDMENT NO. 2 TO NOTE PURCHASE AGREEMENT




THIS AMENDMENT NO. 2 TO NOTE PURCHASE AGREEMENT (this “Amendment”), dated effective as
of June 12, 2008, is between GMX Resources Inc., an Oklahoma corporation (the “Company”),
and the noteholder listed on the signature page hereto (the “Noteholder”).



R E C I T A L S:




A. The Company and the Noteholder entered into a Note Purchase Agreement dated as of July 31,
2007, as amended by that certain Amendment No. 1 to Note Purchase Agreement and Limited Consent
dated February 11, 2008 (as so amended, modified, restated, supplemented, renewed, extended,
increased, rearranged and/or substituted from time to time, the “Note Agreement”).
Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in
the Note Agreement.



B. Reference is made to the Subordinated Guaranty Agreement (the “Guaranty Agreement”)
dated as of July 31, 2007, entered into by Endeavor Pipeline Inc., an Oklahoma corporation
(“Endeavor”), and Diamond Blue Drilling Co., an Oklahoma corporation (“Diamond”,
and together with Endeavor, the “Subsidiary Guarantors”).



C. The Company has requested that the Noteholder agree to (i) exclude the amounts determined
as the mark-to-market values of Swaps, (ii) modify the calculation period for the current Total
Debt to EBITDA financial test from a four-quarter test to a rolling twelve-month test, and (iii)
amend the Note Agreement as more fully described hereinbelow.



D. The Noteholder is willing to agree to such amendments, subject to the performance and
observance in full of each of the covenants, terms and conditions, and in reliance upon all of the
representations and warranties of the Company, set forth herein.



NOW, THEREFORE, in consideration of the premises and the covenants, terms, conditions,
representations and warranties herein contained, the parties hereto hereby agree as follows:



Section 1. AMENDMENTS TO NOTE AGREEMENT. Subject to the covenants, terms and conditions set
forth herein and in reliance upon the representations and warranties of the Company herein
contained, the Company and the Noteholder hereby agree to amend the Note Agreement as set forth
below, effective as of the Amendment Effective Date (as hereinafter defined):



(a) Existing Defined Terms. The following defined terms in paragrgaph 10B of the Note
Agreement are hereby amended as follows:


 


Page 1









 





(i) The defined term “Adjusted PV10” is hereby amended by (1) deleting each occurrence of the
words “clause (v) of paragraph 5A” and (2) replacing such clause in its entirety with the words
“clause (vi) of paragraph 5A” in lieu of each occurrence thereof.



(ii) The defined term “Engineer” is hereby amended by (1) deleting each occurrence of the
words “clause (v)” and (2) replacing such words in their entirety with the words “clause (vi)” in
lieu of each occurrence thereof.



(iii) The defined term “Indebtedness” is hereby amended by (1) deleting clause “(vi)” thereof
and (2) replacing such clause in its entirety with the following:



“(vi) the aggregate Swap Termination Value (provided that for the purpose of this
definition only, clause (ii) of the definition of Swap Termination Value shall not
apply) of all Swaps of such Person; and”




(b) New Covenant.



(i) Paragraph 5A. Paragraph 5A is hereby amended by inserting the following new clause “(i)”
and punctuation, renumbering existing clauses “(i)” through “(xiv)” as clauses “(ii)” through
“(xv)”, respectively.



“(i) as soon as available and in any event within 45 days after the end of each
month in each fiscal year, a certificate setting forth covenant calculations
demonstrating compliance with paragraph 6A(2), all in reasonable detail and
certified by an authorized financial officer of the Company, subject to changes from
year-end adjustments;”




(c) Existing Covenants.



(i) Paragraph 5A. The penultimate paragraph of paragraph 5A is hereby amended by deleting the
words “clauses (i) and (ii)” occurring in the first sentence thereof and replacing such words in
their entirety with the words “clauses (ii) or (iii)”.



(ii) Paragraph 5A. The penultimate sentence of the penultimate paragraph of paragraph 5A is
hereby amended by deleting the words “clause (ii)” occurring therein and replacing such words in
their entirety with the words “clause (iii)”.



(iii) Paragraph 5L. Paragraph 5L is hereby amended by deleting each occurrence of the words
“clause (v) of paragraph 5A” and replacing such words in their entirety with the words “clause (vi)
of paragraph 5A” in lieu of each occurrence thereof.



(iv) Paragraph 6A(2). Paragraph 6A(2) is hereby amended by deleting the words “four fiscal
quarters” occurring therein and substituting the words “twelve months” in lieu thereof.



(v) Paragraph 6G. Paragraph 6G is hereby amended by deleting the words “paragraph 5A(v)” and
replacing such words in their entirety with the words “paragraph 5A(vi)” in lieu thereof.


 


Page 2









 






(d) Existing Representation.



(i) Paragraph 8E. Paragraph 8E is hereby amended by deleting the words “clause (v) of
paragraph 5A” and replacing such words in their entirety with the words “clause (vi) of paragraph
5A”.




(e) Accounting Principles, Terms and Determinations.



(i) Paragraph 10C. Paragraph 10C is hereby amended by deleting the words “clause (ii)” and
replacing such words in their entirety with the words “clause (iii)”.



Section 2. CONDITIONS PRECEDENT. The parties hereto agree that this Amendment and the
amendment to the Note Agreement contained herein shall become effective as of June 12, 2008, upon
the satisfaction of each of the following conditions:



(a) Execution and Delivery of this Amendment. The Noteholder shall have received a copy of
this Amendment executed and delivered by the Company and the Subsidiary Guarantors.



(b) Bank Amendment. The Noteholder shall have received a fully executed copy of an amendment
to the Bank Facility which shall make changes to the Bank Facility corresponding to those in
Section 1 above, such amendment to be in form, scope and substance satisfactory to the Required
Holders.



(c) Grant of Additional Liens. The Noteholder shall have received the Deed of Trust,
Mortgage, Assignment, Security Agreement, Fixture Filing and Financing Statement pursuant to the
requirements of paragraph 5L of the Note Agreement, executed and delivered by all parties thereto.



(d) Intercreditor Agreement Amendment. The Noteholder shall have received a fully executed
copy of an amendment to the Intercreditor Agreement increasing the permitted level of Senior
Indebtedness (as defined in the Intercreditor Agreement) to $185,000,000, such amendment to be in
form, scope and substance satisfactory to the Required Holders.



(e) Supplement to Intercreditor Agreement. The Noteholder shall have received a fully
executed copy of the Supplement to Intercreditor Agreement, executed by each of BNP Paribas,
Compass Bank and Fortis Capital Corp., such supplement to be in form, scope and substance
satisfactory to the Required Holders.



(f) Amendment Fee. The Noteholder shall have received, in immediately available funds, an
amendment fee of $30,000.



(g) Representations and Warranties. Each of the representations and warranties made in this
Amendment shall be true and correct on and as of the Amendment Effective Date as if made on and as
of such date, both before and after giving effect to this Amendment.


 


Page 3









 





Section 3. REPRESENTATIONS AND WARRANTIES. To induce the Noteholder to enter into this
Amendment and to agree to the amendments contained herein, the Company represents and warrants to
the Noteholder as follows:



(a) No Default. No Default or Event of Default exists under any of the Note Documents. As
of the date hereof, the Company is not in default under or with respect to (i) its charter
documents or (ii) any material contractual obligation of the Company. The execution, delivery
and performance of this Amendment shall not result in any default under any contractual
obligation of the Company in any respect.



(b) Binding Effect. This Amendment, the Note Agreement as amended hereby, and the other
Note Documents constitute the legal, valid and binding obligations of the Company, enforceable in
accordance with their terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, or similar laws affecting the enforcement of creditors’ rights generally or by
equitable principles relating to enforceability.




Section 4. MISCELLANEOUS.



(a) APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.



(b) Counterparts and Amendment Effective Date. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts together shall
constitute but one and the same instrument. Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all, the parties hereto. Delivery
of this Amendment may be made by telecopy or electronic transmission of a duly executed
counterpart copy hereof; provided that any such delivery by electronic transmission shall
be effective only if transmitted in .pdf format, .tif format or other format in which the text is
not readily modifiable by any recipient thereof. This Amendment shall become effective as of
June 12, 2008 when each of the conditions set forth in Section 2 of this Amendment have been
satisfied (the “Amendment Effective Date”).



(c) Affirmation of Obligations. Notwithstanding that such consent is not required under the
Guaranty Agreement, or any of the other Note Documents to which it is a party, each of the
Subsidiary Guarantors consents to the execution and delivery of this Amendment by the parties
hereto. As a material inducement to the undersigned to amend the Note Agreement as set forth
herein, each of the Subsidiary Guarantors (i) acknowledges and confirms the continuing existence,
validity and effectiveness of the Guaranty Agreement and each of the other Note Documents to which
it is a party and (ii) agrees that the execution, delivery and performance of this Amendment shall
not in any way release, diminish, impair, reduce or otherwise affect its obligations thereunder.


 


Page 4









 





(d) Note Document. This Amendment is a Note Document and all of the provisions of the Note
Agreement which apply to Note Documents apply hereto.



(Remainder of Page Intentionally Left Blank; Signature Pages Follow)



 


Page 5









 





IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered
by their proper and duly authorized officers effective as of the Amendment Effective Date.



	 	 	 	 	 
	 	 	GMX RESOURCES INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ James A. Merrill
	 

	 	 	 	 
	 

	 	 	 	James A. Merrill

Chief Financial Officer and Treasurer






Signature Page to Amendment No. 2 to Note Purchase Agreement



 


 









 





The foregoing is hereby

agreed to as of the

date thereof.




	 	 	 	 	 
	NOTEHOLDER:	 	 
	 

	 	 	 	 
	THE PRUDENTIAL INSURANCE COMPANY OF AMERICA	 	 
	 
	 	 	 	 
	By:

	 	/s/ Brian E. Lemons	 	 
	 

	 	 	 	 
	 

	 	Vice President	 	 






Signature Page to Amendment No. 2 to Note Purchase Agreement



 


 









 





Agreed to and acknowledged by the undersigned for the purposes set forth in Section 4(c):



	 	 	 	 	 
	 	 	SUBSIDIARY GUARANTORS:
	 
	 	 	 	 
	 	 	ENDEAVOR PIPELINE INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ James A. Merrill
	 

	 	 	 	 
	 

	 	 	 	James A. Merrill

Chief Financial Officer and Treasurer
	 
	 	 	 	 
	 	 	BLUE DIAMOND DRILLING CO.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Richard Hart
	 

	 	 	 	 
	 

	 	 	 	Richard Hart

President






Signature Page to Amendment No. 2 to Note Purchase Agreement