Filed by Bowne Pure Compliance



 





Exhibit 10.4(e)




FIFTH AMENDMENT TO LOAN AGREEMENT




This Fifth Amendment to Loan Agreement (this “Amendment”) dated as of



July 31, 2007, is made among GMX Resources Inc., an Oklahoma corporation (the “Borrower”),
Capital One, National Association, a national banking association, as administrative agent (the
“Agent”), and Union Bank of California, N.A. and Capital One, National Association, as Banks (the
“Banks”), who agrees as follows:



RECITALS




A. This Fifth Amendment to Loan Agreement pertains to that certain Amended and Restated Loan
Agreement (Line of Credit) dated as of June 7, 2006, among the Borrower, the Agent and the Banks,
as amended by the First Amendment dated as of August 4, 2006, the Second Amendment dated as of
August 14, 2006, the Third Amendment dated as of December 21, 2006, and the Fourth Amendment dated
as of March 13, 2007, but effective as of December 31, 2006 (as amended, the “Loan Agreement”). As
used in this capitalized terms used herein without definition herein shall have the meanings
provided in the Loan Agreement.



B. The Borrower, the Agent and the Banks desire to amend the definition used in the negative
covenant regarding permitted indebtedness.



AGREEMENT




NOW, THEREFORE, in consideration of the terms and conditions contained herein, and the loans
and extensions of credit heretofore, now or hereafter made to the Borrower by the Banks, the
parties hereto hereby agree as follows:



ARTICLE 1.



AMENDMENT AND AGREEMENT




1.1 Section 1.2 of the Loan Agreement is hereby amended by amending and restating the
definition of the term “Maximum Subordinated Amount”, to read in its entirety as follows:



“Maximum Subordinated Amount” shall mean eighty million
($80,000,000.00) dollars, consisting of fifty million
($50,000,000.00) dollars of Qualified Redeemable Preferred Equity
and thirty million ($30,000,000.00) dollars of Qualified
Subordinated Debt.



1.2 Section 1.2 of the Loan Agreement is hereby amending by deleting the definition of the
term “Diamond Note”.



1.3 Section 2.6 of the Loan Agreement is hereby amended by amending and restating Section 2.6
“Use of Proceeds”, to read in its entirety as follows:



Section 2.6 Use of Proceeds. The Borrower shall use the
proceeds of the Loan (i) in connection with the acquisition and
development of oil and gas properties as well as general corporate
and working
capital purposes (including letters of credit hereunder) and (ii) to
loan funds to Diamond in accordance with Section 6.3(h).


 


 









 





1.4 Section 3.1 of the Loan Agreement is hereby amended by amending and restating clause (ix),
to read in its entirety as follows:



(ix) Guaranty Agreement executed by Diamond, and Security Agreement
executed by Diamond, granting a first priority lien and security
interest in its personal property, together with a UCC Financing
Statement pertaining thereto.



1.5 Section 4.20 of the Loan Agreement is hereby amended by deleting the second sentence of
subsection (c).



1.6 Section 4.21 of the Loan Agreement is hereby amended by amending and restating the first
sentence of subsection (a), to read in its entirety as follows:



The Borrower has no Debt for borrowed money from any Person (other
than this new Loan), except the PVOG Production Payment (on the
terms described in the definition thereof) and the Qualified
Subordinated Debt (on terms meeting the definition thereof)
described in the Intercreditor Agreement dated as of July 31, 2007,
among the Agent, the Banks, The Bank of New York Trust Company,
N.A., as Noteholder Collateral Agent, and The Prudential Insurance
Company of America.



1.7 Section 5.2 of the Loan Agreement is hereby amended by deleting subsection (n).
Notwithstanding this deletion, the Borrower acknowledges that the Agent or any Bank may from time
to time pursuant to Section 5.2(m) request a report detailing the status of the loan by the
Borrower to Diamond as to loan amount, payment history and default (if any).



1.8 Subsection (b) of Section 5.15 of the Loan Agreement is hereby amended to delete the
following language from the end of that subsection (b):



nor will the effect, if any, of fair value adjustments or ceiling
test write-downs pursuant to Regulation S-X 4-10 of the Securities
and Exchange Commission be included”.



1.9 Section 5.20 of the Loan Agreement is hereby amended and restated, to read in its entirety
as follows:



Section 5.20 Diamond Loan. The Borrower shall cause any
loan made by the Borrower to Diamond to be unsecured.



1.10 The Loan Agreement is hereby amended by adding the following new Section 5.21, to read in
its entirety as follows:



Section 5.21 Diamond Limitation. The Borrower shall not,
and shall not permit Diamond or any Subsidiary, to own any drilling
rig other than the three (3) drilling rigs owned by Diamond on July
15, 2007.




 


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1.11 Section 6.3 of the Loan Agreement (as previously amended) is hereby amended by amending
and restating subsection (g), to read in its entirety as follows:



(g) The Borrower’s ownership of equity interest in Endeavor, and in
Diamond, provided further that the Borrower shall not make
further investment (debt or equity) in Diamond after July 15, 2007,
except to the extent of investment or a loan or advance necessary to
fund capital expenditures by Diamond which are necessary and
appropriate to maintain the existing three (3) drilling rigs in
service (including the initial placement of the third drilling rig
in service). For the avoidance of doubt, the Borrower acknowledges
that the foregoing restriction, without limitation, requires the
Agent’s and the Required Bank’s consent to any investment, loan or
advance to permit Diamond to acquire an additional drilling rig.



1.12 Section 6.3 of the Loan Agreement is hereby amended by amending subsection (h) by
deleting clause (ii).



1.13 Section 6.16 of the Loan Agreement is hereby amended by adding the following clause (b)
to the end of Section 6.16:



and (z) the foregoing shall not apply to prohibitions, restrictions
and conditions imposed by the documents pertaining to any issued
Qualified Subordinated Debt (as such documents are approved in
accordance with Section 6.11(b) above).



ARTICLE 2.



ACKNOWLEDGMENT OF COLLATERAL




2.1 The Borrower hereby specifically reaffirms all of the Collateral Documents. The Borrower
hereby confirms and agrees that the Collateral Documents secure the Loan Agreement as amended by
this Amendment.



[The rest of this page is blank intentionally.]




 


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ARTICLE 3.



MISCELLANEOUS




3.1 The Borrower represents and warrants to the Agent and the Banks (which representations and
warranties will survive the execution of this Amendment) that (i) all representations and
warranties contained in the Loan Agreement and the Collateral Documents are true and correct on and
as of the date hereof as though made on and as of such date, except to the extent such
representations and warranties specifically relate to an earlier date, in which case such
representations and warranties shall have been true and correct on and as of such earlier date,
(ii) after giving effect to the waiver set forth in Paragraph 1.1, no event has occurred and is
continuing as of the date hereof which constitutes a Default or Event of Default, (iii) there has
not occurred any material adverse change in the Collateral or other assets, liabilities, financial
condition, business operations, affairs or circumstances of the Borrower and the Subsidiaries taken
as a whole or any other facts, circumstances or conditions (financial or otherwise) upon which a
Bank has relied or utilized in making its decision to enter into this Amendment, and (iv) there is
no defense, offset, compensation, counterclaim or reconventional demand with respect to amounts due
under, or performance of, the terms of the Notes and the Loan Agreement. To the extent any such
defense, offset, compensation, counterclaim or reconventional demand or other causes of action by
the Borrower against the Agent or any Bank might exist, whether known or unknown, such items are
hereby waived by the Borrower.



3.2 Except as expressly modified by this Amendment, all terms and provisions of the Loan
Agreement are hereby ratified and confirmed and shall be and shall remain in full force and effect,
enforceable in accordance with its terms.



3.3 The Borrower agrees to pay on demand all costs and expenses of the Agent and the Banks in
connection with the preparation, reproduction, execution and delivery of this Amendment and the
other instruments and documents to be delivered hereunder (including the reasonable fees and
expenses of counsel for the Agent). In addition, Borrower shall pay any and all stamp or other
taxes, recordation fees and other fees payable in connection with the execution, delivery, filing
or recording of this Amendment and the other instruments and documents to be delivered hereunder
and agrees to hold Agent and the Banks harmless from and against any all liabilities with respect
to or resulting from any delay or omission in paying such taxes or fees.



3.4 This Amendment may be executed in multiple separate counterparts, and it shall not be
necessary that the signatures of all parties hereto be contained on any one counterpart hereof;
each party’s signature may appear on a separate counterpart but all such counterpart taken together
shall constitute one and the same instrument. The parties specifically confirm their intent to be
bound by delivery of such signed counterparts by telecopier.



3.5 The provisions of this Amendment shall become effective if and when, and only when, (i)
each and every representation and warranty of Borrower contained in this Amendment is true,
complete and accurate, (ii) no event exists which constitutes a Default, and (iii) the receipt by
the Agent of a duly executed counterpart of this Amendment. The Borrower hereby certifies by
execution of this Amendment that the foregoing conditions (i) and (ii) are satisfied and true and
correct.


 


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3.6 The Borrower agrees to execute and deliver to the Agent, promptly upon its availability,
an Amended and Restated Texas Deed of Trust, with an updated property description exhibit.



3.7 The Agent and the Banks agree that the Security Agreement (Promissory Note) dated as of
June 7, 2006, by the Borrower and the Agent, is hereby terminated and released. The Borrower
hereby terminates and releases the Amended and Restated Security Agreement dated as of June 7, 2006
made by Diamond in favor of the Borrower, and the Agent and the Banks hereby consent thereto.



[The rest of this page is blank intentionally.]




 


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



	 	 	 	 	 	 	 	 	 
	 	 	BORROWER:	 	GMX RESOURCES INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ken L. Kenworthy, Sr.
 

	 	 
	 	 	 	 	Name: Ken L. Kenworthy, Sr.	 	 
	 	 	 	 	Title: Executive Vice President and CFO	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	AGENT:	 	CAPITAL ONE, NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Eric Broussard
 

	 	 
	 	 	 	 	Name: Eric Broussard	 	 
	 	 	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BANKS:	 	CAPITAL ONE, NATIONAL ASSOCIATION,	 	 
	 	 	 	 	as a Bank	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Eric Broussard
 

	 	 
	 	 	 	 	Name: Eric Broussard	 	 
	 	 	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	UNION BANK OF CALIFORNIA, N.A.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Randell L. Osterberg
 

	 	 
	 	 	 	 	Name: Randell L. Osterberg	 	 
	 	 	 	 	Title: Sr. Vice President – US Marketing Manager	 	 







 


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