Exhibit 10.2


 


AMENDMENT
NO. 2 TO CREDIT AND GUARANTY AGREEMENT


 


This Amendment No. 1 to
Credit and Guaranty Agreement (this "Agreement") dated as of April 26, 2017 (the "Effective
Date"), is among Lilis Energy, Inc., a Nevada corporation (the "Borrower"), the undersigned
subsidiaries of the Borrower constituting the Guarantors (defined in the Credit Agreement (as defined below)), the undersigned
Lenders constituting the Lenders required to be party hereto pursuant to the terms of Section 9.1 of the Credit Agreement referred
to below, the undersigned New Lenders (as such term is defined below), and Deans Knight Capital Management Ltd, as collateral
agent for the Lenders (together with its successors and assigns, the "Collateral Agent").


 


INTRODUCTION


 


A.           The
Borrower, the Guarantors, certain lenders, and the Collateral Agent are parties to that certain Credit and Guaranty Agreement dated
as of September 29, 2016 (the “Credit Agreement”).


 


B.           The
Borrower, the Collateral Agent and the Lenders agree to amend certain provisions of the Credit Agreement, in each case subject
to the terms and conditions set forth herein.


 


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


 


Section 1.          Defined
Terms; Other Definitional Provisions. As used in this Agreement, each of the terms defined in the opening paragraph and
the Recitals above shall have the meanings assigned to such terms therein. Each term defined in the Credit Agreement and used herein
without definition shall have the meaning assigned to such term in the Credit Agreement, unless expressly provided to the contrary.
Article, Section, Schedule, and Exhibit references are to Articles and Sections of and Schedules and Exhibits to this Agreement,
unless otherwise specified. The words "hereof", "herein", and "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The
term "including" means "including, without limitation,". Paragraph headings have been inserted in this Agreement
as a matter of convenience for reference only and it is agreed that such paragraph headings are not a part of this Agreement and
shall not be used in the interpretation of any provision of this Agreement.


 


Section 2.          Amendments
to Credit Agreement. 


 


(a)          Section
1.1 of the Credit Agreement is hereby amended by inserting the following new definitions therein in the appropriate alphabetical
order:


 


“Core Assets”
means the hydrocarbon interests of the Borrower and its Subsidiaries located in the Delaware Basin (including, any pipeline or
salt water disposal assets).


 


“Federal Funds Effective
Rate” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates
on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published
on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Collateral Agent from three Federal funds brokers of recognized standing selected by it.


 




    	



     


    

 


(a)          Section
6.10.2(i) of the Credit Agreement is hereby amended and restated in full as follows:


 


6.10.2    (i)
The Borrower has not (a) received notice or otherwise learned of any Environmental Liability arising in connection with (1) any
non-compliance with or violation of the requirements of any Environmental Law or (2) the release or threatened release of any Hazardous
Substance into the environment, (b) received notice or otherwise learned of any federal or state investigation evaluating whether
any remedial action is needed to respond to a release or threatened release of any Hazardous Substance into the environment for
which the Borrower is or may be liable, in each case which would be reasonably expected to have a Material Adverse Effect. The
Borrower knows of no basis for any Environmental Liability.


 


(b)          Section
6.10.2(ii) of the Credit Agreement is hereby amended and restated in full as follows:


 


(ii)         For
each Guarantor, such Guarantor has not (a) received notice or otherwise learned of any Environmental Liability arising in connection
with (1) any noncompliance with or violation of the requirements of any Environmental Law or (2) the release or threatened release
of any Hazardous Substance into the environment or (b) received notice or otherwise learned of any federal or state investigation
evaluating whether any remedial action is needed to respond to a release or threatened release of any Hazardous Substance into
the environment for which such Guarantor is or may be liable, in each case which would be reasonably expected to have a Material
Adverse Effect. No Guarantor knows of any basis for any Environmental Liability.


 


(c)          Article
VI of the Credit Agreement is hereby amended to add the following new Section 6.24 as follows:


 


6.24        Environmental
Reports. The Borrower has furnished to the Collateral Agent all material environmental audits, assessments, reports and other
material environmental, health or safety documents relating to the past or current operations or facilities of the Borrower or
any Subsidiary (including the Core Assets), in each case which are in the possession or under the reasonable control of the Borrower
or any Subsidiary.


 


(d)          Article
IX of the Credit Agreement is hereby amended to add the following new Section 9.17 as follows:


 


9.17        Interest
Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any
Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively
the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted
for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest
payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum
Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable
as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect
of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with
interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender. In the
event that, notwithstanding Section 9.7.1, applicable law is the law of the State of Texas and such applicable law provides for
an interest ceiling under Chapter 303 of the Texas Finance Code (the “Texas Finance Code”) as amended, for
each day, the ceiling shall be the “weekly ceiling” as defined in the Texas Finance Code and shall be used in this
Agreement and the other Loan Documents for calculating the Maximum Rate and for all other purposes. Chapter 346 of the Texas Finance
Code (which regulates certain revolving credit accounts (formerly Tex. Rev. Civ. Stat. Ann. Art. 5069, Ch. 15)) shall not apply
to this Agreement or to any Loan, nor shall this Agreement or any Loan be governed by or be subject to the provisions of such
Chapter 346 in any manner whatsoever.


 




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Section 3.          Conditions
to Effectiveness. This Agreement shall become effective on the Effective Date and enforceable upon the Collateral Agent
receiving counterparts of this Agreement, duly executed by the Borrower, the Guarantors, the Lenders constituting the Lenders required
to be party hereto pursuant to the terms of Section 9.1 of the Credit Agreement, the New Lenders, and the Collateral Agent.


 


Section 4.          Payment
of Fees. The Borrower acknowledges and agrees that it shall pay the fees and expenses required to be paid pursuant to,
and in accordance with, Section 9.4 of the Credit Agreement.


 


Section 5.          Acknowledgments
and Agreements. 


 


(a)          The
Borrower acknowledges that on the date hereof all outstanding Obligations are payable in accordance with their terms and the Borrower
waives any defense, offset, counterclaim or recoupment with respect thereto.


 


(b)          The
Borrower, the Collateral Agent, and the Lenders party hereto do hereby adopt, ratify, and confirm the Credit Agreement, as amended
hereby, and together with each Guarantor acknowledge and agree that the Credit Agreement, as amended hereby, is and remains in
full force and effect, and the Borrower and the Guarantors acknowledge and agree that their respective liabilities and obligations
under the Credit Agreement, as amended hereby, are not impaired in any respect by this Agreement.


 


(c)          From
and after the Effective Date, all references to the Credit Agreement and the Loan Documents shall mean the Credit Agreement and
such Loan Documents as amended by this Agreement.


 


(d)          This
Agreement is a Loan Document for the purposes of the provisions of the other Loan Documents.


 


Section 6.          Reaffirmation
of the Guaranty. Each Guarantor hereby ratifies, confirms, acknowledges and agrees that its obligations under the Credit
Agreement are in full force and effect and that such Guarantor continues to unconditionally and irrevocably guarantee the full
and punctual payment, when due, whether at stated maturity or earlier by acceleration or otherwise, of all the Guaranteed Obligations,
as such Guaranteed Obligations may have been amended by this Agreement, and its execution and delivery of this Agreement does not
indicate or establish an approval or consent requirement by such Guarantor in connection with the execution and delivery of amendments,
consents or waivers to the Credit Agreement or any other Loan Documents.


 


Section 7.          Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be an original and all of which together shall
constitute, one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by telecopy,
e-mail, facsimile transmission, electronic mail in “portable document format” (“.pdf”) form or other electronic
means intended to preserve the original graphic and pictorial appearance of the item being sent shall be effective as a delivery
of a manually executed counterpart of this Agreement.


 




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Section 8.          Successors
and Assigns. This terms and provisions of this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns permitted pursuant to the Credit Agreement.


 


Section 9.          Invalidity;
Severability. . If any provision of this Agreement is held to be illegal, invalid, or unenforceable under present
or future laws effective during the term hereof or thereof, such provision shall be fully severable, and this Agreement shall be
construed and enforced as if such illegal, invalid, or unenforceable provision had never comprised a part thereof, and the remaining
provisions hereof shall remain in full force and effect and shall not be affected by the illegal, invalid, or unenforceable provision
or by its severance therefrom. Furthermore, in lieu of such illegal, invalid or unenforceable provision there shall be added automatically
as a part of this Agreement a provision as similar in terms to such illegal, invalid, or unenforceable provision as may be possible
and be legal, valid and enforceable.


 


Section 10.        Governing
Law. This Agreement shall be governed by, construed in accordance with, and interpreted and enforced pursuant to the Laws
of the State of New York (and the applicable federal Laws of the United States of America) without giving effect to its choice
of law principles.


 


Section 11.         Entire
Agreement. THIS AGREEMENT, THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE AGREEMENT BETWEEN THE
PARTIES HERETO WITH RESPECT TO THE SUBJECT HEREOF AND SHALL SUPERSEDE ANY PRIOR AGREEMENT BETWEEN THE PARTIES HERETO, WHETHER WRITTEN
OR ORAL, RELATING TO THE SUBJECT HEREOF. FURTHERMORE, IN THIS REGARD, THIS AGREEMENT, THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES THERETO AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF SUCH PARTIES.


 


[The remainder of this page
has been left blank intentionally.]


 




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Exhibit 10.2


 


EXECUTED to be effective
as of the date first above written.


 


	BORROWER:	LILIS ENERGY, INC.
	 	 	 
	 	By:	/s/ Abraham Mirman
	 	Name: Abraham Mirman
	 	Title: Chief Executive Officer
	 	 	 
	GUARANTORS:	brushy resources, inc.
	 	 	 
	 	By:	/s/ Abraham Mirman
	 	Name: Abraham Mirman
	 	Title: Chief Executive Officer and President
	 	 	 
	 	impetro operating llc
	 	 	 
	 	By:	/s/ Abraham Mirman
	 	Name: Abraham Mirman
	 	Title: Chief Executive Officer and President
	 	 	 
	 	IMPETRO RESOURCES, LLC
	 	 	 
	 	By:	/s/ Abraham Mirman
	 	Name: Abraham Mirman
	 	Title: Chief Executive Officer and President
	 	 	 
	 	LILIS OPERATING, LLC
	 	 	 
	 	By:	/s/ Abraham Mirman
	 	Name: Abraham Mirman
	 	Title: Member of the Board of Managers


 




    	 



     


    

 


	COLLATERAL AGENT:	Deans Knight Capital Management Ltd.
	 	 	 
	 	By:	/s/ Dillon Cameron
	 	Name:  	Dillon Cameron
	 	Title: 	Authorized Signatory


 




    	 



     


    

 


	 	RBC INVESTOR SERVICES TRUST ITF 110952002,
	 	as a Lender
	 	 	 
	 	By:	/s/ Dillon Cameron
	 	Name:  	Dillon Cameron
	 	Title: 	Authorized Signatory


 




    	 



     


    

 


	 	JAYVEE & CO. ITF YTCF6310002,
	 	as a Lender
	 	 	 
	 	By:	/s/ Dillon Cameron
	 	Name:  	Dillon Cameron
	 	Title: 	Authorized Signatory


 




    	 



     


    

 


	 	NGPI CANADA INC.,
	 	as a Lender
	 	 	 
	 	By:	/s/  Phillip Hampson
	 	Name: 	Phillip Hampson
	 	Title:	President


 




    	 



     


    

 


	 	TRACE CAPITAL INC.,
	 	as a Lender
	 	 	 
	 	By:	/s/ Jennifer Nadj
	 	Name: 	Jennifer Nadj
	 	Title:	President


 




    	 



     


    

 


	 	INVESTOR COMPANY ITS 5J5505C,
	 	as a Lender
	 	 	 
	 	By:	/s/ Tim Logie
	 	Name: 	Tim Logie
	 	Title:	Portfolio Manager


 




    	 



     


    

 


	 	PETER ELLIS,
	 	as a Lender
	 	 	 
	 	By:	/s/ Peter Ellis


 




    	 



     


    

 


	 	thOMAS ROOTHAM,
	 	as a Lender
	 	 	 
	 	By:	/s/ Thomas Rootham


 




    	 



     


    

 


	 	SPROTT RESOURCE LENDING CORP.,
	 	as Lender
	 	 	 
	 	By:	/s/ Peter Grosskopf
	 	Name: 	Peter Grosskopf
	 	Title:	Chief Executive Officer


 




    	 



     


    

 


	 	RESOURCE INCOME PARTNERS LIMITED PARTNERSHIP,
	 	as Lender
	 	 	 
	 	By:	/s/ Gretchen Carter
	 	Name: 	Gretchen Carter
	 	Title:	Chief Financial Officer


 




    	 



     


    

 


	 	ONE E LP,
	 	as Lender
	 	 	 
	 	By:	/s/ Gray Fowler
	 	Name: 	Gray Fowler
	 	Title:	Signing Officer


 




    	Signature Page to Amendment No. 2 to Credit and Guarantee Agreement