Document:

Exhibit 10.1 - Amendment to Second Lien Facility

    Exhibit
      10.1 

     

    EXECUTION
      COPY

     

    

      AMENDMENT
        NO. 1 AND AGREEMENT dated as of December 19, 2006 (this “Amendment”),
        to
        the Second Lien Credit Agreement dated as of July 21, 2005 (the
“Credit
        Agreement”),
        among
        CARRIZO OIL & GAS, INC. (the “Borrower”),
        CCBM,
        INC. (“CCBM”),
        CCLR,
        INC. (“CLLR”),
        the
        Lenders (as defined therein) and CREDIT SUISSE, as administrative agent (in
        such
        capacity, the “Administrative
        Agent”)
        and as
        collateral agent (in such capacity, the “Collateral
        Agent”)
        for
        the Lenders.

       

      A.  Pursuant
        to the Credit Agreement, the Lenders have extended credit to the
        Borrower.

       

      B.  The
        Borrower has requested that the existing Lenders or other persons that will
        thereby become lenders (collectively, the “Additional
        Lenders”)
        make
        Additional Term Loans (as defined below) to the Borrower on the Additional
        Term
        Loan Closing Date (as defined below), in an aggregate principal amount of
        $75,000,000, subject to the terms and conditions set forth herein. 

       

      C.  The
        Borrower has further requested certain amendments to the Credit Agreement
        as set
        forth herein.

       

      D.  The
        proceeds of the Additional Term Loans will be used by the Borrower for general
        corporate purposes of the Borrower. 

       

      E.  The
        Additional Lenders are willing to make the Additional Term Loans and the
        Lenders
        are willing to agree to such amendments, in each case on the terms and subject
        to the conditions set forth herein.

       

      F.  Capitalized
        terms used but not defined herein shall have the meanings assigned to them
        in
        the Credit Agreement.

       

      Accordingly,
        in consideration of the mutual agreements herein contained and other good
        and
        valuable consideration, the sufficiency and receipt of which are hereby
        acknowledged, the parties hereto agree as follows:

       

      SECTION
        1.   Defined
        Terms.
        As used
        in this Amendment, the following terms shall have the meanings set forth
        below:

       

      “Additional
        Term Loan Commitment”
shall
        mean, with respect to each Additional Lender, the commitment of such Additional
        Lender to make Additional Term Loans on the Additional Term Loan Closing
        Date as
        set forth on Schedule I hereto. The aggregate amount of Additional Term Loan
        Commitments is $75,000,000.

       

      “Additional
        Term Loans”
shall
        mean the term loans made by the Additional Lenders to the Borrower pursuant
        to
        Section 2(a) hereof, the terms and 

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        provisions
          of which shall be identical to the existing Loans (as such terms are modified
          pursuant to this Amendment).

         

        SECTION
          2.   Additional
          Term Loans. (a)
          Subject
          to the terms and conditions set forth herein and relying upon the
          representations and warranties set forth herein and in the other Loan Documents,
          each Additional Lender agrees, severally and not jointly, to make an Additional
          Term Loan to the Borrower on the Additional Term Loan Closing Date in a
          principal amount not to exceed its Additional Term Loan Commitment. Amounts
          paid
          or prepaid in respect of Additional Term Loans may not be
          reborrowed.

         

        (b)
            The
          Additional Term Loan Commitments shall automatically terminate upon the
          earlier
          to occur of (a) the making of the Additional Term Loans on the Additional
          Term Loan Closing Date and (b) 5:00 p.m., New York City time, on
          January 15, 2007.

         

        (c)
            Unless
          the context shall otherwise require, the term “Loans” as used in the Credit
          Agreement shall include the Additional Term Loans, and the term “Lenders” as
          used herein and in the Credit Agreement shall include each person that
          has an
          Additional Term Loan Commitment or that has made an Additional Term Loan
          (other
          than any such person that has ceased to be a party to the Credit Agreement
          pursuant to an Assignment and Acceptance).

         

        SECTION
          3.   Amendments.
          (a)
          The
          definition of the term “Applicable Percentage” set forth in Section 1.01 of the
          Credit Agreement is hereby amended and restated in its entirety to read
          as
          follows:

         

        ““Applicable
          Percentage”
shall
          mean, for any day, (a) with respect to any Eurodollar Loan, 4.75%, or (b)
          with
          respect to any ABR Loan, 3.75%.”

         

        (b)
            The
          definition of the term “Permitted Disposition” set forth in Section 1.01 of the
          Credit Agreement is hereby amended by deleting the word “and” preceding
          clause (g) and adding after clause (g) the following:

         

        “and
          (h)
          of equity interests which the Borrower or any Guarantor holds in
          Pinnacle”.

         

        (c)
            Effective
          upon the making of the Additional Term Loans on the Additional Term Loan
          Closing
          Date, the table appearing in Section 2.11 (Repayment
          of Borrowings)
          of the
          Credit Agreement is hereby amended and restated in its entirety to read
          as
          follows:

         

        
          	
                  “Repayment
                    Date

                   

                	
                  Amount

                   

                
	
                  December
                    31, 2006

                	
                  $375,000

                
	
                  March
                    31, 2007

                	
                  $562,500

                
	
                  June
                    30, 2007

                	
                  $562,500

                
	
                  September
                    30, 2007

                	
                  $562,500

                
	
                  December
                    31, 2007

                	
                  $562,500

                

        

      

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    

      
        	
                 “Repayment
                  Date

              	
                Amount
 
	
                March
                  31, 2008

              	
                $562,500

              
	
                June
                  30, 2008

              	
                $562,500

              
	
                September
                  30, 2008

              	
                $562,500

              
	
                December
                  31, 2008

              	
                $562,500

              
	
                March
                  31, 2009

              	
                $562,500

              
	
                June
                  30, 2009

              	
                $562,500

              
	
                September
                  30, 2009

              	
                $562,500

              
	
                December
                  31, 2009

              	
                $562,500

              
	
                March
                  31, 2010

              	
                $562,500

              
	
                June
                  30, 2010

              	
                $562,500

              
	
                Maturity
                  Date

              	
                $214,875,000

              
	 	 

      

      (d)
          Section
        2.12(c) of the Credit Agreement is hereby amended and restated in its entirety
        to read as follows:

       

      “Optional
        prepayments of Loans at any time during the applicable periods set forth
        in this
Section
        2.12(c)
        shall be
        accompanied by a payment of a prepayment fee in an amount (expressed as a
        percentage of the principal amount of the Loans to be repaid) equal to
        (i) 1.50%, if such prepayment occurs prior to the date that is two years
        after the Closing Date or (ii) 0.50%, if such prepayment occurs after the
        date
        that is two years after the Closing Date, but on or prior to the date that
        is
        three years after the Closing Date.”.

       

      (e)
          Section
        5.01(c)(iii)(x)(A) of the Credit Agreement is hereby amended by adding after
        the
        words “Section 6.02(a)” appearing therein the following:

       

      “(other
        than assignments of customary overrides, royalties, working interests in
        exchange for a commitment of the transferee to bear a disproportionate share
        of
        the costs attributable to the oil and gas properties to which such interests
        relate, and similar ordinary course transactions and Dispositions or series
        of
        related Dispositions of Proved Reserves with a fair market value not in excess
        of $1,000,000)”.

       

      (f)
          Section
        5.01(c)(iii)(y)(A) of the Credit Agreement is hereby amended by adding after
        the
        words “Section 6.02(b)” appearing therein the following:

       

      “(other
        than (I) assignments of customary overrides, royalties, working interests
        in exchange for a commitment of the transferee to bear a disproportionate
        share
        of the costs attributable to the oil and gas properties to which such interests
        relate and similar ordinary course transactions and Dispositions or series
        of
        related Dispositions of property and assets with a fair market value not
        in
        excess of $1,000,000 and (II) Permitted Dispositions)”.

       

      (g)
          Section
        5.01(c)(iii)(y)(B) of the Credit Agreement is hereby amended by adding after
        the
        words “Section 6.02(b)” appearing therein the following:

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

    

      “(it
        being understood and agreed that the Borrower is not required under this
        clause
        (iii)(y)(B) to certify as to assets acquired during the applicable period
        in the
        ordinary course of business, but that only such assets (if any) satisfying
        the
        requirements of Section 6.02(b)(ii)(2) as to which such certification is
        made will be netted from the basket amounts set forth in Section 6.02(b) as
        contemplated by such Section)”.

       

      (h)
          Section
        5.01(f) of the Credit Agreement is hereby amended by deleting the
        following:

       

      “and
        containing pricing assumptions consistent with the definition of the term
“PV-10
        Value””.

       

      (i)
          Section
        5.07(b) of the Credit Agreement is hereby amended by replacing clause (i)
        thereof in its entirety with the following:

       

      “(i) 3.75
        to 1.00 in the case of periods ending on December 31, 2006 through and
        including December 31, 2007 and”.

       

      (j)
          Section
        5.07(c) of the Credit Agreement is hereby amended by replacing clause (i)
        thereof in its entirety with the following:

       

      “1.50
        to
        1.00 in the case of the last day of any fiscal quarter ending on or before
        December 31, 2007 and”.

       

      (k)
          Section
        5.07(d) of the Credit Agreement is hereby amended by replacing clause (i)
        thereof in its entirety with the following:

       

      “2.75
        to
        1.00 in the case of the last day of any fiscal quarter ending on or before
        December 31, 2007 and”.

       

      (l)
          Section
        5.09(b) of the Credit Agreement is hereby amended by deleting the words “The
        Borrower shall, each year, at the time of delivery of the annual financial
        statements with respect to the preceding fiscal year pursuant to
        Section 5.01(a),” appearing at the beginning of such clause and replacing
        them with the following: 

       

      “If
        requested by the Administrative Agent in writing, the Borrower shall reasonably
        promptly after such request”.

       

      (m)
          Section
        5.12 of the Credit Agreement is hereby amended by adding to the beginning
        of the
        second sentence the following:

       

      “If
        requested by the Administrative Agent in writing,”.

       

      (n)
          Sections
        6.02(a) and (b) of the Credit Agreement are hereby amended by adding after
        the
        words “in any fiscal year” contained in subclauses (x) the
        following:

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

    

    

      “(with,
        subject to the aggregate limitation set forth in the immediately succeeding
        clause (y), any such amount not used in any fiscal year being carried forward
        to
        any subsequent fiscal year)”.

       

      (o)
          Section
        6.06 of the Credit Agreement is hereby amended by deleting the “and” at the end
        of clause (k) and adding clauses (m) and (n) as follows:

       

      “(m)
        Investments, loans or advances or acquisitions the consideration for which
        consists solely of common equity interests of the Borrower, or made out of
        the
        net cash proceeds of a substantially contemporaneous issuance of common equity
        interests of the Borrower; and

       

      (n)
        Equity interests in Pinnacle held by the Borrower or any Guarantor as of
        the
        effective date of Amendment No. 1 and Agreement dated as of
        December 19, 2006, to this Agreement.”.

       

      (p)
          Section
        6.06(e) of the Credit Agreement is hereby amended and restated in its entirety
        to read as follows:

       

      “Loans
        by
        the Borrower or a Guarantor to the Guarantors or capital contributions or
        investments by the Borrower or a Guarantor in any Guarantor; provided,
        however,
        the
        following loans, investments or capital contributions are excluded from this
        part (e): loans, investments or capital contributions by the Borrower or
        a
        Guarantor to any Guarantor, if such Guarantor uses the proceeds of such loan,
        contribution or investment to invest in Pinnacle or any other entity in which
        the Borrower or such Guarantor owns an equity interest (other than a
        Guarantor);”.

       

      (q)
          Section 6.06(j)
        of the Credit Agreement is hereby amended by changing the reference in the
        proviso thereto to “$1,000,000” to “$5,000,000”.

       

      (r)
          Section 6.06(l)
        of the Credit Agreement is hereby amended by changing the reference in
        clause (i) thereof to “$2,000,000” to “$5,000,000”.

       

      (s)
          Section 7.01(b)
        of the Credit Agreement is hereby amended and restated in its entirety to
        read
        as follows:

       

      “Default
        Under This Agreement.
        Should
        the Borrower violate or fail to comply fully with any of the terms and
        conditions of, or default under (i) any covenant, condition or agreement
        contained in Section 5.03(a)(ii) (with respect to the maintenance of the
        Borrower’s existence only), Section 5.02, 5.07 or Article VI or (ii)
        any other covenant, condition or agreement (other than those referred to
        in
        clause (a) of this Section 7.01) and such default is not cured within
        30 days after notice thereof from the Administrative Agent or any Lender to
        the Borrower; provided,
        however,
        that
        the cure period available for a default in the obligation to maintain insurance
        coverages required hereby shall be 10 days.”.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

    

    SECTION
      4.   Other
      Agreements.
      The
      Required Lenders hereby waive until April 2, 2007 compliance by the Borrower
      with Section 5.14(a) of the Credit Agreement.

     

    SECTION
      5.   Representations
      and Warranties.
      To
      induce the other parties hereto to enter into this Amendment, the Borrower
      represents and warrants to the Administrative Agent, the Collateral Agent and
      each of the Lenders that, as of the Amendment Effective Date (as defined
      below):

     

    (a)
        This
      Amendment has been duly authorized, executed and delivered by the Borrower
      and
      each Guarantor and the Credit Agreement, as amended hereby, constitutes a legal,
      valid and binding obligation of the Borrower and each Guarantor and this
      Amendment constitutes a legal, valid and binding obligation of the Borrower
      and
      each Guarantor.

     

    (b)
        The
      representations and warranties set forth in Article IV of the Credit Agreement,
      after giving effect to this Amendment, are true and correct in all material
      respects on and as of the Amendment Effective Date with the same effect as
      though made on and as of the Amendment Effective Date, except to the extent
      such
      representations and warranties expressly relate to an earlier date (in which
      case such representations and warranties were true and correct in all material
      respects as of such earlier date); provided
      that
      (i) the reference in the last sentence of Section 4.02 of the Credit
      Agreement to “December 31, 2004” shall be deemed to refer to
“December 31, 2005”, (ii) each reference to Schedule 4.03 in
      Section 4.03 of the Credit Agreement (other than the first such reference)
      shall be deemed to be a reference to the most recent Reserve Report delivered
      pursuant to Section 5.01(e) or (g) of the Credit Agreement and
      (iii) Section 4.12 of the Credit Agreement shall be deemed to read in
      its entirety “Intentionally Omitted”.

     

    (c)
        No
      Default or Event of Default has occurred and is continuing.

     

    SECTION
      6.   Effectiveness. (a)
      This
      Amendment shall become effective as of the date first set forth above on the
      date (the “Amendment
      Effective Date”)
      on
      which the Administrative Agent (or its counsel) shall have received counterparts
      of this Amendment that, when taken together, bear the signatures of the
      Borrower, each Guarantor, the Administrative Agent and the Requisite Lenders.
      As
      used herein, the term “Requisite Lenders” shall mean each Lender,
      including each Additional Lender.

     

    (b)
        The
      obligations of the Lenders with Additional Term Loan Commitments to make
      Additional Term Loans are subject to the satisfaction of each of the following
      conditions (the date on which such conditions are satisfied, the “Additional
      Term Loan Closing Date”):

     

    
      (i)    The
        Borrower
        and each Guarantor that is to be a party thereto shall have executed and
        delivered to the Administrative Agent this Amendment, modifications or
        supplements to the Mortgages reflecting the making of the Additional Term
        Loans
        as reasonably requested by the Collateral Agent and all other documents required
        by this Amendment or the Credit Agreement (including a promissory note that
        complies with the requirements of Section 

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      

        2.04(e)
          in favor of each Additional Lender that has requested a promissory note),
          all in
          form and substance and in such number of counterparts as may be required
          by the
          Administrative Agent;

         

        (ii)  The
          representations, warranties, and covenants of the Borrower as set forth
          in the
          Credit Agreement, or in any Related Document furnished to the Administrative
          Agent and/or any Lender in connection therewith, shall be and remain true
          and
          correct as of such date (except to the extent specifically limited to a
          specified date);

         

        (iii)  The
          Administrative Agent shall have received favorable legal opinions of
          (i) counsel to the Borrower and the Guarantors covering the transactions
          contemplated by this Amendment and (ii) special Louisiana counsel to the
          Administrative Agent and Collateral Agent covering the enforceability and
          recordability of the modifications or supplements to the Mortgages relating
          to
          properties in Louisiana reflecting the making of the Additional Term Loans
          as
          reasonably requested by the Collateral Agent, in each case, in form, scope
          and
          substance satisfactory to the Administrative Agent;

         

        (iv)  The
          Administrative Agent shall have received certified resolutions of the Borrower
          and each Guarantor authorizing the execution of all documents and instruments
          contemplated by this Amendment;

         

        (v)  The
          Administrative Agent shall have received all fees, charges and expenses
          which
          are due and payable as specified in this Amendment, the Credit Agreement
          and any
          other Loan Documents to be entered into on or prior to the Additional Term
          Loan
          Closing Date, including, to the extent invoiced, reimbursement or payment
          of all
          out-of-pocket expenses required to be reimbursed or paid by the Borrower
          hereunder, under any Related Document to be entered into on or prior to
          the
          Additional Term Loan Closing Date or under any engagement or fee letter
          between
          the Borrower and the Administrative Agent (or any of its affiliates) relating
          to
          the credit facilities contemplated hereby;

         

        (vi)  No
          Default or Event of Default shall exist or shall result from the making
          of an
          Additional Term Loan;

         

        (vii)  
          The Administrative Agent shall have received the articles of incorporation
          and
          bylaws, as amended, of each of the Borrower and each Guarantor ((x) in the
          case of such articles of incorporation, certified as of a recent date by
          the
          Secretary of State of the state of its organization and together with a
          certificate as to the good standing of each of the Borrower and each Guarantor
          as of a recent date, from such Secretary of State and (y) in the case of
          such bylaws, certified by the Secretary or Assistant Secretary of the Borrower
          and such Guarantor and together with such incumbency certificates as the
          Administrative Agent shall reasonably request), and the Administrative
          

         

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

        
           

          Agent’s
            counsel shall have reviewed the foregoing documents and shall be satisfied
            with
            the validity, due authorization and enforceability thereof and of all
            Related
            Documents and with all other legal matters incident to this Agreement,
            the
            Borrowings and extensions of credit hereunder and the Related
            Documents;

           

          (vii)  The
            Administrative Agent shall have received evidence acceptable to it and
            its
            counsel that the security interests created pursuant to the Collateral
            Documents
            shall continue to have a first priority position, subject only to Permitted
            Encumbrances and the Intercreditor Agreement;

           

          (ix)  The
            Borrower shall have complied with the procedures set forth in the Credit
            Agreement for the making of Loans, including delivery to the Administrative
            Agent of a notice of Borrowing as required by Section 2.03 (with the
            reference to the Closing Date in the first sentence thereof deemed to
            be a
            reference to the Additional Term Loan Closing Date);

           

          (x)  There
            shall have occurred no Material Adverse Effect since December 31,
            2005;

           

          (xi)  The
            Additional Lenders shall be reasonably satisfied with their review prior
            to the
            date hereof of all environmental matters related to the Borrower and
            the
            Mortgaged Properties;

           

          (xii)  To
            the
            extent requested by Administrative Agent and required by the Loan Documents,
            the
            Borrower shall have executed and delivered to the Administrative Agent
            blank
            form letters in lieu of division orders, in form and substance satisfactory
            to
            the Administrative Agent;

           

          (xiii)  The
            Administrative Agent shall have received a copy of the most recent reports
            required to be delivered pursuant to Sections 5.01(e), (f) and (g) of the
            Credit Agreement, and the substance of such reports shall be satisfactory
            to the
            Additional Lenders;

           

          (xiv)  The
            Administrative Agent shall have received a certificate, dated the date
            hereof
            and signed by the chief financial officer of the Borrower, confirming
            compliance
            with the conditions precedent set forth in clauses (ii) and (vi)
            above;

           

          (xv)  The
            Administrative Agent shall have received evidence acceptable to the
            Administrative Agent and its counsel that the Revolving Credit Agreement
            has
            been amended pursuant to an amendment in form and substance reasonably
            satisfactory to the Administrative Agent that, among other things, permits
            the
            Borrower to incur the indebtedness represented by the Additional Term
            Loans;

           

          (xvi)  The
            Additional Lenders
            shall have received, to the extent requested, all documentation and other
            information required by regulatory 

           

          
            
              
              

            

            
              8

              
                

              

            

            
              
              

            

          

          

            authorities
              under applicable “know your customer” and anti-money laundering rules and
              regulations, including the USA Patriot Act; and

             

            (xvii)  The
              Collateral Agent shall have received a certificate, dated the Additional
              Term
              Loan Closing Date and signed by an officer of the Borrower, certifying that,
              except as set forth on any schedule attached thereto, the information
              set forth
              on the Perfection Certificate is complete, correct and accurate as
              of the
              Additional Term Loan Closing Date.

             

            SECTION
              7.   Effect
              of Amendment.
              Except
              as expressly set forth herein, this Amendment shall not by implication
              or
              otherwise limit, impair, constitute a waiver of, or otherwise affect
              the rights
              and remedies of the Lenders, the Collateral Agent or the Administrative
              Agent
              under the Credit Agreement or any other Loan Document, and shall not
              alter,
              modify, amend or in any way affect any of the terms, conditions, obligations,
              covenants or agreements contained in the Credit Agreement or any other
              Loan
              Document, all of which are ratified and affirmed in all respects and
              shall
              continue in full force and effect. Nothing herein shall be deemed to
              entitle any
              Loan Party to a consent to, or a waiver, amendment, modification or
              other change
              of, any of the terms, conditions, obligations, covenants or agreements
              contained
              in the Credit Agreement or any other Loan Document in similar or different
              circumstances. This Amendment shall apply and be effective only with
              respect to
              the provisions of the Credit Agreement specifically referred to herein.
              After
              the date hereof, any reference to the Credit Agreement shall mean the
              Credit
              Agreement, as modified hereby. This Amendment shall constitute a “Loan Document”
for all purposes of the Credit Agreement and the other Loan
              Documents.

             

            SECTION
              8.   Counterparts.
              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 contract. Delivery of an executed counterpart
              of a
              signature page of this Amendment by facsimile transmission shall be
              as effective
              as delivery of a manually executed counterpart hereof.

             

            SECTION
              9.   Applicable
              Law. THIS
              AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
              LAWS OF
              THE STATE OF NEW YORK.

             

            SECTION
              10.   Headings.
              The
              headings of this Amendment are for purposes of reference only and shall
              not
              limit or otherwise affect the meaning hereof.

             

            SECTION
              11.   Expenses.
              The
              Borrower agrees to reimburse the Administrative Agent for all reasonable
              out-of-pocket expenses incurred in connection with this Amendment,
              including the
              reasonable fees, charges and disbursements of Cravath, Swaine & Moore
              LLP, counsel for the Administrative Agent.

             

            SECTION
              12.  Acknowledgment
              of
              Guarantors.
              Each of
              the Guarantors hereby acknowledges receipt and notice of, and consents
              to the
              terms of, this Amendment, and 

             

            
              
                
                

              

              
                9

                
                  

                

              

              
                
                

              

            

            

              affirms
                and confirms its guarantee of the Indebtedness and, if applicable,
                the pledge of
                and/or grant of a security interest in its assets as Collateral to
                secure the
                Indebtedness, all as provided in the Collateral Documents, and acknowledges
                and
                agrees that such guarantee, pledge and/or grant of security interest
                continue in
                full force and effect in respect of, and to secure, the Indebtedness
                under the
                Credit Agreement, as amended hereby, and the other Loan Documents
                and that such
                Indebtedness shall include all obligations in respect of the Additional
                Term
                Loans.

               

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                  10

                  
                    

                  

                

                
                  
                  

                

              

              

                IN
                  WITNESS WHEREOF, the parties hereto have caused this Amendment
                  to be duly
                  executed by their respective authorized officers as of the day
                  and year first
                  above written.

                 

                
                  	 	 	 
	 	
                          CARRIZO
                            OIL & GAS, INC.,

                        
	 
 	 
 	 
 
	 	
                          By  

                        	
                           

                          /s/
                            Paul F. Boling

                        
	 	
                          Name: Paul
                            F. Boling

                        
	 	
                          Title: Vice
                            President and Chief Financial
                            Officer

                        

                

                 

                
                  	 	 	 
	 	
                          CCBM,
                            INC.,

                        
	 
 	 
 	 
 
	 	By  	
                           

                          /s/
                            Paul F. Boling

                        
	 	
                          Name: Paul
                            F. Boling

                        
	 	
                          Title: Vice
                            President and Chief Financial
                            Officer

                        

                

                 

                 

                  	 	 	 
	 	
                          CLLR,
                            INC.,

                        
	 
 	 
 	 
 
	 	By   	

                          /s/
                            Paul F. Boling

                        
	 	
                          Name: Paul
                            F. Boling

                        
	 	
                          Title: Vice
                            President and Chief Financial
                            Officer

                        

                

                 

                
                  	 	 	 
	 	
                          CREDIT
                            SUISSE, CAYMAN ISLANDS BRANCH, individually, and as Administrative
                            Agent
                            and Collateral Agent,

                        
	 
 	 
 	 
 
	 	By   	
                           

                          
                            /s/
                              James Morgan

                          

                        
	 	
                          Name:
                            James Morgan

                        
	 	
                          Title:
                            Managing Director

                        
	 	 
	
                          By
  

                        	
                           

                          
                            /s/
                              Nupur Kumar

                          

                        
	 	 Name:
                          Nupur Kumar
	 	 Title:
                          Associate

                

                 

                 

                
                  
                    
                    

                  

                  
                    
                    

                    
                      

                    

                  

                  
                    
                    

                  

                

                

                

                  SIGNATURE
                    PAGE TO 

                  AMENDMENT
                    NO. 1 AND AGREEMENT 

                  TO
                    CARRIZO OIL & GAS, INC.

                  SECOND
                    LIEN CREDIT AGREEMENT 

                

                 

                

                  Name
                    of
                    Lender:______________________________________

                   

                

                

                
                  	 	 	 
	 	
                          By
  	 
	 	
                          Name:

                        
	 	
                          Title:

                        
	 	 
	 	 
	
                           By

                        	
                           

                           

                        
	 	 Name:
	 	 Title:

                

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

              

            

          

        

      

    

     

    SCHEDULE
      I

     

    

      LENDERS
        AND ADDITIONAL TERM LOAN COMMITMENT

       

      
        	
                Additional
                  Lender

              	
                Additional
                  Term

                Loan
                  Commitment

              
	 	 
	
                Alexandra
                  Investment Management

              	
                500,000.00

              
	
                Angelo
                  Gordon Arb

              	
                2,750,000.00

              
	
                Bank
                  of America Prop

              	
                4,250,000.00

              
	
                Basso

              	
                2,250,000.00

              
	
                Blackrock
                  / Merrill Lynch Asset Management

              	
                750,000.00

              
	
                LaSalle
                  / Boldwater CBNA Loan Funding

              	
                -

              
	
                Cedarview
                  Capital

              	
                1,250,000.00

              
	
                Credit
                  Suisse

              	
                2,450,000.00

              
	
                CSAM/Credit
                  Suisse Asset Management

              	
                1,250,000.00

              
	
                CSFB
                  International

              	
                -

              
	
                Deephaven
                  Capital Management

              	
                7,500,000.00

              
	
                DMD
                  Special Situations, LLC

              	
                2,000,000.00

              
	
                Goldentree
                  Management

              	
                1,000,000.00

              
	
                Goldman
                  Sachs Special Situations 

              	
                1,750,000.00

              
	
                GSO

              	
                5,250,000.00

              
	
                Halcyon

              	
                1,000,000.00

              
	
                Highland
                  Capital

              	
                3,250,000.00

              
	
                K
                  Street Capital

              	
                1,750,000.00

              
	
                Kayne
                  Anderson Capital

              	
                7,250,000.00

              
	
                MJX
                  Asset Management

              	
                1,750,000.00

              
	
                MSD
                  Captial

              	
                4,250,000.00

              
	
                Nationwide
                  Mutual

              	
                500,000.00

              
	
                Par
                  IV Capital Management LLC

              	
                6,000,000.00

              
	
                Post
                  Advisory

              	
                350,000.00

              
	
                Trilogy
                  Capital, LLC

              	
                1,250,000.00

              
	
                Whippoorwill

              	
                14,700,000.00

              
	 	 
	
                Total

              	
                $75,000,000.00Exhibit 10.2 - Amendment to First Lien Credit Facility

    Exhibit
      10.2

    
 

    FIRST
      AMENDMENT TO CREDIT AGREEMENT,
      CONSENT AND WAIVER

     

    FIRST
      AMENDMENT TO CREDIT AGREEMENT, CONSENT AND WAIVER
      (hereinafter referred to as the “Amendment”)
      executed to be effective as of December 19, 2006, by and among CARRIZO OIL
&
GAS, INC., a Texas corporation (“Borrower”),
      certain subsidiaries of Borrower, as Guarantors (in such capacity, “Guarantors”),
      the
      LENDERS party hereto (the Lenders”) and JPMORGAN CHASE BANK, N.A., as
      Administrative Agent (in its such capacity, “Administrative
      Agent”).
      Unless the context otherwise expressly defined herein, capitalized terms used
      but not defined in this Amendment have the meanings assigned to such terms
      in
      the Credit Agreement (as defined below).

     

    WITNESSETH:

     

    WHEREAS,
      Borrower, Guarantors, Administrative Agent and Lenders have entered unto that
      certain Credit Agreement, dated as of May 25, 2006, (as amended, supplemented
      or
      otherwise modified from time to time, the “Credit
      Agreement”);
      and

     

    WHEREAS,
      Borrower
      has requested that Administrative Agent and Lenders amend the Credit Agreement
      to, among other things, (i) permit the incurrence of additional Indebtedness
      under the Second Lien Facility, (ii) modify the Leverage Ratio, and (iii)
      redetermine the Borrowing Base and Conforming Borrowing Base; and

     

    WHEREAS,
      Administrative Agent and Lenders have agreed to do so on the terms and
      conditions hereinafter set forth;

     

    NOW,
      THEREFORE,
      for and
      in consideration of the mutual covenants and agreements herein contained and
      other good and valuable consideration, the receipt and sufficiency of which
      are
      hereby acknowledged and confessed, Borrower, Administrative Agent and Lenders,
      hereby agree as follows:

     

    SECTION
      1.  Amendments
      to Credit Agreement.
      Subject
      to the satisfaction or waiver in writing of each condition precedent set forth
      in Section 3
      of this
      Amendment, and in reliance on the representations, warranties, covenants and
      agreements contained in this Amendment, the Credit Agreement shall be amended
      in
      the manner provided in this Section 1.

     

    1.1  Additional
      Definitions. The
      following definition shall be and hereby is added to Section 1.01:

     

    “First
      Amendment Effective Date”
      means December 19, 2006.

     

    1.2  Amended
      Definition.
      The
      following definition in Section 1.01
      of the
      Credit Agreement shall be and hereby is amended in its entirety to read as
      follows:

     

    “Change
      in Control”
      shall be deemed to have occurred if (a) any “person” or “group” (within the
      meaning of Rule 13d-5 of the Securities Exchange Act of 1934 as in effect on
      the
      date hereof) other than the Permitted Investors shall own, directly or
      indirectly, beneficially or of record, shares representing more than fifty
      percent (50%) of the aggregate ordinary voting power represented by the issued
      and outstanding capital stock of the Borrower, (b) a majority of

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    the
      seats (other than vacant seats) on the board of directors of the Borrower shall
      at any time be occupied by persons who were neither (i) nominated by the board
      of directors of the Borrower nor (ii) appointed by directors so nominated,
      or
      (c) any change in control (or similar event, however denominated) with respect
      to the Borrower shall occur under (and not be waived in accordance with) and
      as
      defined in the Second Lien Credit Agreement or any indenture or other loan
      or
      credit agreement or any other debt instrument evidencing any Material
      Indebtedness to which the Borrower is a party.

     

    1.3  Borrowing
      Base Adjustments. Section 3.05
      of the
      Credit Agreement shall be and hereby is amended in its entirety to read as
      follows:

     

    (a) In
      the event the Redetermination of the Borrowing Base is not made on or prior
      to
      May 1, 2007 as a result of the Borrower failing to comply with the requirements
      of this Article III
      with
      respect to such Redetermination on the dates required without giving effect
      to
      any grace or cure period provided in Article IX
      with
      respect to any such failure, the Borrowing Base shall be reduced by $1,690,000
      on May 1, 2007 and on the first date of each month thereafter (the
“Monthly
      Reduction”)
      until the Borrowing Base is otherwise redetermined pursuant to this
Article III.

     

    (b) In
      the event the outstanding principal balance of the Indebtedness under the Second
      Lien Facility exceeds $225,000,000 at any time after the First Amendment
      Effective Date, the Borrowing Base then in effect shall be reduced by $1.00
      for
      every $4.00 of such additional Indebtedness as of the date such additional
      Indebtedness is incurred.

     

    1.4  Investment
      and Holding Company Status. Section 4.08
      of the
      Credit Agreement shall be and hereby is amended in its entirety to read as
      follows:

     

    Investment
      Company Status.
      Neither the Borrower nor any Restricted Subsidiary is an “investment company” as
      defined in, or subject to regulation under, the Investment Company Act of
      1940.

     

    1.5  Financial
      Statements; Other Information. Section 6.01(f)
      of the
      Credit Agreement shall be and hereby is amended in its entirety to read as
      follows:

     

    (f) together
      with the Reserve Reports required under clause (e)
      above, (i) a report, in reasonable detail, setting forth the Swap Agreements
      then in effect, the notional volumes of and prices for, on a monthly basis
      and
      in the aggregate, the Crude Oil and Natural Gas for each such Swap Agreement
      and
      the term of each such Swap Agreement; (ii) if requested by Administrative Agent
      in writing, a true and correct schedule of the Mortgaged Properties, (iii)
      if
      requested by Administrative Agent in writing, the percentage of the Engineered
      Value of the Borrowing Base that the Mortgaged Properties represent and (iv)
      a
      description of the additional Oil and Gas Interests, if any, to be mortgaged
      by
      the Credit Parties to comply with Section 6.09
      and
      the Engineered Value thereof;

     

    1.6  Maintenance
      of Properties; Insurance. Section 6.05
      of the
      Credit Agreement shall be and hereby is amended in its entirety to read as
      follows:

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    

      Maintenance
        of Properties; Insurance.
        The
        Borrower will, and will cause each Restricted Subsidiary and use commercially
        reasonable efforts to cause each operator of Borrowing Base Properties to,
        keep
        and maintain all property material to the conduct of its business in good
        working order and condition, ordinary wear and tear excepted. The
        Borrower shall maintain in effect all insurance required by this Agreement
        and
        the Collateral Documents, and the Borrower agrees to comply with the
        representations and warranties set forth in Section 4.16.
        Upon the written request of the Administrative Agent, the Borrower agrees
        to
        (a) promptly provide the Administrative Agent with certificates or binders
        evidencing such insurance coverage on an annual basis, (b) promptly furnish
        the
        Administrative Agent with copies of all renewal notices and copies of receipts
        for paid premiums, and (c) promptly provide the Administrative Agent with
        certificates or binders evidencing insurance coverage pursuant to all renewal
        or
        replacement policies of insurance.

       

      1.7  Mortgages. Section 6.09
        of the
        Credit Agreement shall be and hereby is amended in its entirety to read as
        follows:

       

      Mortgages.
        No
        later than April 2, 2007, and from time to time as requested by the
        Administrative Agent and in any event to the extent required under the
        Intercreditor Agreement, the Borrower will, and will cause each Guarantor
        to,
        execute and deliver to the Administrative Agent, for the benefit of the Secured
        Parties, Mortgages in form and substance reasonably acceptable to the
        Administrative Agent together with such other assignments, conveyances,
        amendments, agreements and other writings, including, without limitation,
        UCC-1
        financing statements (each duly authorized and executed, as applicable) as
        the
        Administrative Agent shall reasonably deem necessary or appropriate to grant,
        evidence and perfect a valid first priority Lien, subject only to Permitted
        Liens, in (a) not less than eighty percent (80%) of the Engineered Value
        of all
        Borrowing Base Properties (excluding any Oil and Gas Interests in the area
        known
        as the Camp Hill Field in Anderson County, Texas) and (b) not less than eighty
        percent (80%) of the Engineered Value of the Borrower’s and each Guarantor’s Oil
        and Gas Interests in the area known as the Camp Hill Field in Anderson County,
        Texas. 

       

      1.8  Title
        Data. Section 6.10
        of the
        Credit Agreement shall be and hereby is amended in its entirety to read as
        follows:

       

      Title
        Data.
        As
        soon as available and in any event no later than April 2, 2007, the Borrower
        will, and will cause each Guarantor to, deliver to the Administrative Agent
        such
        opinions of counsel and other evidence of title as the Administrative Agent
        shall deem reasonably necessary or appropriate to verify (i) such Credit
        Party’s
        title to not less than seventy-five percent (75%) of the Engineered Value
        of the
        Borrowing Base Properties (excluding any Oil and Gas Interests in the area
        known
        as the Camp Hill Field in Anderson County, Texas), (ii) such Credit Party’s
        title to not less than fifty percent (50%) of the Engineered Value of the
        Oil
        and Gas Interests in the area known as the Camp Hill Field in Anderson County,
        Texas and (iii) the validity, perfection and priority of the Liens created
        by
        the Mortgages and such other matters regarding the Mortgages as Administrative
        Agent shall reasonably request. The Borrower will, and will cause each Guarantor
        to, use commercially reasonable efforts to deliver to the Administrative
        Agent,
        or its counsel on or before April 2, 2007, reasonably satisfactory evidence
        demonstrating that the Borrower or such Guarantor, as the case may be, has
        performed all of the title curative actions described on Schedule 6.10. To
        the
        extent any such title curative 

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      

        action
          is not performed on or before April 2, 2007, the Administrative Agent may,
          in
          its reasonable discretion, reduce the Borrowing Base to account for such
          failure
          to perform such title curative action and such reduction shall be restored
          upon
          the performance of such title curative action to the reasonable satisfaction
          of
          the Administrative Agent.

         

        1.9  Permitted
          Indebtedness. Section 7.01(h)
          of the
          Credit Agreement shall be and hereby is amended in its entirety to read
          as
          follows:

         

        (h) subject
          to any adjustment to the Borrowing Base and Conforming Borrowing Base required
          under Section 3.05,
          Indebtedness under the Second Lien Facility, including Guarantees thereof
          by the
          Restricted Subsidiaries, in an aggregate principal amount not to exceed
          $225,000,000 at any time outstanding;

         

        1.10  Fundamental
          Changes. Section 7.04(c)
          of the
          Credit Agreement shall be and hereby is amended in its entirety to read
          as
          follows:

         

        (c) subject
          to the prior written consent of the Required Lenders, any other Disposition
          of
          Borrowing Base Properties, provided that no such consent is required if
          (i) the
          Borrower delivers prior written notice of such Disposition to the Administrative
          Agent at least thirty (30) days prior to the date of such Disposition,
          or such
          shorter period of time agreed to by the Administrative Agent, specifying
          the
          Borrowing Base Properties to be included in such Disposition, the proposed
          closing date for such Disposition and the consideration to be received
          by the
          Borrower and any Guarantors, as the case may be, as a result of such
          Disposition, and (ii) the Credit Parties prepay the Borrowings pursuant
          to
Section 2.10(b)
          in an
          amount sufficient to eliminate any Borrowing Base Deficiency as determined
          by
          the Required Lenders after the receipt of such notice by the Administrative
          Agent and in such Lenders’ complete and sole discretion using such
          methodologies, assumptions and discount rates as such Lenders customarily
          use in
          assigning collateral value to Oil and Gas Interests
          as of
          such date of determination;

         

        1.11  Fair
          Market Value.
          The
          proviso at the end of Section 7.04
          of the
          Credit Agreement shall be and hereby is amended in its entirety to read
          as
          follows:

         

        provided,
          however,
          that
          any Disposition pursuant to clauses
          (b) through (g)
          shall be
          for fair market value.

         

        1.12  Investments,
          Loans, Advances, Guarantees and Acquisitions. Section 7.05(j)
          of the
          Credit Agreement shall be and hereby is amended in its entirety to read
          as
          follows:

         

        (j) investments
          made pursuant to the requirements of farm-out, farm-in, joint operating,
          joint
          venture or area of mutual interest agreements, gathering systems, pipelines
          or
          other similar or customary arrangements entered into the ordinary course
          of
          business (including advances to operators under operating agreements entered
          into by the Borrower in the ordinary course of business); provided that
          any such
          single investment in excess of $5,000,000 shall be approved by the Board
          of
          Directors of the Borrower.

         

        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

        

        

          1.13  Investments,
            Loans, Advances, Guarantees and Acquisitions. Section 7.05(l)
            of the
            Credit Agreement shall be and hereby is amended to delete the word “and”
from
            the end of such section.

           

          1.14  Investments,
            Loans, Advances, Guarantees and Acquisitions. Section 7.05(m)
            of the
            Credit Agreement shall be and hereby is amended in its entirety to read
            as
            follows:

           

          (m) investments,
            loans, advances and acquisitions the consideration for which consists
            solely of
            (A) Equity Interests of the Borrower or (B) the net cash proceeds of
            a
            substantially contemporaneous issuance of Equity Interest of the Borrower;
            and

           

          1.15  Investments,
            Loans, Advances, Guarantees and Acquisitions. Section 7.05
            of
            the
            Credit Agreement shall be and hereby is amended by adding the following
            as
clause (n)
            at the
            end of such section.

           

          (n) any
            other
            investments in any Person having an aggregate fair market value (measured
            on the
            date each such investment was made and without giving effect to subsequent
            changes in value), when taken together will all other investments made
            pursuant
            to this clause (n)
            do not
            exceed $5,000,000.

           

          1.16  Leverage
            Ratio. Section 7.12(b)
            of the
            Credit Agreement shall be and hereby is amended in its entirety to read
            as
            follows:

           

          (b) Leverage
            Ratio.

           

           

          (i) The
            Borrower will not permit the ratio, determined as of the end of the fiscal
            quarter ending June 30, 2006, of (A) Total Net Debt as of the end of
            such fiscal
            quarter, to (B) Consolidated EBITDAX for the trailing four (4) fiscal
            quarter
            period ending on such date, to be greater than 3.50 to 1.0.

           

           

          (ii) The
            Borrower will not permit the ratio, determined as of the end of the fiscal
            quarter ending September 30, 2006, of (A) Total Net Debt as of the end
            of such
            fiscal quarter to (B) Consolidated EBITDAX for the trailing four (4)
            fiscal
            quarter period ending on such date, to be greater than 3.25 to
            1.00.

           

           

          (iii) The
            Borrower will not permit the ratio, determined as of the end of any fiscal
            quarter ending on or after December 31, 2006, through and including
            December 31, 2007, of (A) Total Net Debt as of the end of such fiscal
            quarter to (B) Consolidated EBITDAX for the trailing four fiscal quarter
            period
            ending on such date, to be greater than 3.75 to 1.00.

           

           

          (iv) The
            Borrower will not permit the ratio, determined as of the end of any fiscal
            quarter ending on or after March 31, 2008, of (A) Total Net Debt as of
            the end
            of such fiscal quarter to (B) Consolidated EBITDAX for the trailing four
            fiscal
            quarter period ending on such date, to be greater than 3.25 to
            1.00.

           

          
            
              
              

            

            
              5

              
                

              

            

            
              
              

            

          

        

        

          For
            purposes of determining the Borrower’s compliance with this Section 7.12(b),
            Consolidated EBITDAX shall not include the net revenue attributable to
            any
            assets that are subject to a Lien granted to secure the Non-Recourse
            Debt.

           

          1.17  Events
            of Default. Article
            IX, paragraph (d)
            of the
            Credit Agreement shall be and hereby is amended in its entirety to read
            as
            follows:

           

          (d) the
            Borrower or any Restricted Subsidiary shall fail to observe or perform
            any
            covenant, condition or agreement contained in (i) Section 6.02,
            and
            such failure shall continue unremedied for a period of ten (10) days
            after the
            occurrence thereof, (ii) Section 6.01 and
            Section 6.05
            (with
            respect to insurance), and such failure shall continue unremedied for
            a period
            of ten (10) days after notice of such failure from the Administrative
            Agent to
            Borrower or (iii) Section 6.03
            (with
            respect to the Borrower or any Restricted Subsidiary’s existence),
            Section 6.08,
            or in
Article
            VII.

           

          1.18  Events
            of Default.
            Article
            IX, paragraph (e)
            of the
            Credit Agreement shall be and hereby is amended in its entirety to read
            as
            follows:

           

          (e) the
            Borrower or any Restricted Subsidiary shall fail to observe or perform
            any
            covenant, condition or agreement contained in (i) this Agreement (other
            than
            those specified in clause
            (a), (b) or (d)
            of this
            article) and such failure shall continue unremedied for a period of thirty
            (30) days after notice of such failure from Administrative Agent to
            Borrower or (ii) any other Loan Document and such failure shall continue
            unremedied for a period of twenty (20) days after notice of such failure
            from
            Administrative Agent to Borrower;

           

          1.19  Redetermined
            Borrowing Base; Conforming Borrowing Base. This
            Amendment shall constitute a notice of the redetermination of the Borrowing
            Base
            and the Monthly Reduction pursuant to Section 3.03
            of the
            Credit Agreement and Administrative Agent hereby notifies Borrower that,
            upon
            the funding of the additional Indebtedness under the Second Lien Facility
            pursuant to the amendment thereto in the form attached hereto as Exhibit
            “A”,
            the
            redetermined Borrowing Base is $54,250,000, and the redetermined Conforming
            Borrowing Base is $46,750,000.

           

          1.20  Consent
            to Second Lien Amendment.
            Administrative Agent and Lenders hereby consent to the amendment of the
            Second
            Lien Credit Agreement in the form attached hereto as Exhibit “A”.

           

          SECTION
            2.  Waiver.
            Borrower
            has failed to comply with the covenants set forth in Sections
            6.09
            and
6.10
            of the
            Credit Agreement. As requested by Borrower, the Lenders (or at least
            the
            required percentage thereof) hereby waive the Event of Default pursuant
            to
Article IX,
            clause (e)
            of the
            Credit Agreement arising as a result of Borrower’s failure to comply with the
            covenants set forth in Sections
            6.09
            and
6.10
            of the
            Credit Agreement. The foregoing waiver is expressly limited as follows:
            (a) such waiver is limited to Sections
            6.09
            and
6.10
            for the
            period prior to the First Amendment Effective Date, (b) such waiver shall
            not be applicable to any provision of the Credit Agreement or any other
            Loan
            Document other than Sections
            6.09
            and
6.10
            of the
            Credit Agreement, and (c) such waiver is a limited, one-time waiver, and
            nothing contained herein shall obligate any Lender to grant any additional
            or
            future waiver of Sections
            6.09
            and
6.10
            of the

           

          
            
              
              

            

            
              6

              
                

              

            

            
              
              

            

          

          

            Credit
              Agreement for any other period or grant any additional or future waiver
              of any
              other provision of the Credit Agreement or any other Loan Document.

             

            SECTION
              3.  Conditions.
              The
              amendments to the Credit Agreement contained in Section
              1
              of this
              Amendment and the waiver contained in Section
              2
              of this
              Amendment shall be effective upon the satisfaction of each of the conditions
              set
              forth in this Section 3.

             

            3.1  Execution
              and Delivery.
              Each
              Credit Party, each Lender and the Administrative Agent shall have executed
              and
              delivered this Amendment.

             

            3.2  Amendment
              of Second Lien Credit Agreement.
              Borrower, Guarantors, the lenders party thereto and Credit Suisse,
              Cayman
              Islands Branch, as Administrative Agent for such lenders, shall have
              executed
              and delivered an amendment to the Second Lien Credit Agreement dated
              as of the
              date hereof in the form attached hereto as Exhibit “A”
              and the
              conditions to its effectiveness shall have been satisfied.

             

            3.3  No
              Default.
              No
              Default shall have occurred and be continuing or shall result from
              effectiveness
              of this Amendment or the amendment to the Second Lien Credit
              Agreement.

             

            3.4  No
              Material Adverse Effect.
              No
              Material Adverse Effect shall have occurred since December 31,
              2005.

             

            3.5  Other
              Documents.
              The
              Administrative Agent shall have received such other instruments and
              documents
              incidental and appropriate to the transaction provided for herein as
              the
              Administrative Agent or its special counsel may reasonably request,
              and all such
              documents shall be in form and substance satisfactory to the Administrative
              Agent.

             

            SECTION
              4.  Representations
              and Warranties of Borrower.
              To
              induce the Lenders to enter into this Amendment, the Borrower hereby
              represents
              and warrants to the Lenders as follows:

             

            4.1  Reaffirmation
              of Representations and Warranties/Further Assurances.
              After
              giving effect to the amendments herein, each representation and warranty
              of the
              Borrower contained in the Credit Agreement or in any of the other Loan
              Documents
              is true and correct in all material respects as of the First Amendment
              Effective
              Date (except to the extent such representations and warranties specifically
              refer to an earlier date).

             

            4.2  Corporate
              Authority; No Conflicts.
              The
              execution, delivery and performance by the Borrower (to the extent
              a party
              hereto or thereto) of this Amendment and all documents, instruments
              and
              agreements contemplated herein are within Borrower’ corporate or other
              organizational powers, have been duly authorized by necessary action,
              require no
              action by or in respect of, or filing with, any court or agency of
              government
              and do not violate or constitute a default under any provision of any
              applicable
              law or other agreements binding upon Borrower or result in the creation
              or
              imposition of any Lien upon any of the assets of Borrower except for
              Permitted
              Liens and otherwise as permitted in the Credit Agreement.

             

            4.3  Enforceability.
              This
              Amendment constitutes the valid and binding obligation of Borrower
              enforceable
              in accordance with its terms, except as (i) the enforceability thereof may
              be limited by bankruptcy, insolvency or similar laws affecting creditor’s rights
              generally, and 

             

            
              
                
                

              

              
                7

                
                  

                

              

              
                
                

              

            

            

              (ii) the
                availability of equitable remedies may be limited by equitable principles
                of
                general application.

               

              SECTION
                5.  Miscellaneous.

               

              5.1  Reaffirmation
                of Loan Documents and Liens.
                Any and
                all of the terms and provisions of the Credit Agreement and the Loan
                Documents
                shall, except as amended and modified hereby, remain in full force
                and effect.
                Borrower hereby agrees that the amendments and modifications herein
                contained
                shall in no manner affect or impair the liabilities, duties and obligations
                of
                Borrower under the Credit Agreement and the other Loan Documents
                or the Liens
                securing the payment and performance thereof.

               

              5.2  Parties
                in Interest.
                All of
                the terms and provisions of this Amendment shall bind and inure to
                the benefit
                of the parties hereto and their respective successors and assigns.

               

              5.3  Legal
                Expenses.
                Borrower
                hereby agrees to pay all reasonable fees and expenses of special
                counsel to the
                Administrative Agent incurred by the Administrative Agent in connection
                with the
                preparation, negotiation and execution of this Amendment and all
                related
                documents.

               

              5.4  Counterparts.
                This
                Amendment may be executed in one or more 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; signature pages may be detached
                from multiple
                separate counterparts and attached to a single counterpart so that
                all signature
                pages are physically attached to the same document. However, this
                Amendment
                shall bind no party until Borrower, the Lenders, and the Administrative
                Agent
                have executed a counterpart. Delivery of photocopies of the signature
                pages to
                this Amendment by facsimile or electronic mail shall be effective
                as delivery of
                manually executed counterparts of this Amendment.

               

              5.5  Complete
                Agreement.
                THIS
                AMENDMENT, THE CREDIT AGREEMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT
                THE
                FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
                EVIDENCE OF
                PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES. THERE ARE
                NO UNWRITTEN
                ORAL AGREEMENTS BETWEEN THE PARTIES.

               

              5.6  Headings.
                The
                headings, captions and arrangements used in this Amendment are, unless
                specified
                otherwise, for convenience only and shall not be deemed to limit,
                amplify or
                modify the terms of this Amendment, nor affect the meaning thereof.

               

               

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                of page intentionally blank]

               

              

              
                
                  
                  

                

                
                  8

                  
                    

                  

                

                
                  
                  

                

              

              IN
                WITNESS WHEREOF,
                the
                parties have caused the First Amendment to Credit Agreement, Consent
                and Waiver
                to be duly executed by their respective authorized officers to be
                effective as
                of the date first above written.

               

              
                	 	 	 
	 	BORROWER:
	 	 
	 	CARRIZO OIL & GAS, INC.
	 
 	 
 	 
 
	 	By:  	
                        /s/
                          Paul F. Boling

                      
	 	Name: Paul F. Boling
	 	Title:Vice
                        President and Chief Financial
                        Officer

              

               

              
                	 	 	 
	 	
                        GUARANTORS:

                      
	 	 
	 	CCBM, INC.
	 
 	 
 	 
 
	 	By:  	
                        /s/
                          Paul F. Boling

                      
	 	Name: Paul F. Boling
	 	
                        Title:
                          Vice President

                      

              

               

              
                	 	 	 
	 	
                        CCLR,
                          INC.

                      
	 
 	 
 	 
 
	 	
                        By:   

                      	
                        /s/
                          Paul F. Boling

                      
	 	
                        Name:
                          Paul F. Boling

                      
	 	
                        Title:
                          Vice President

                      

              

               

              
                	 	 	 
	 	
                        ADMINISTRATIVE
                          AGENT AND 

                        LENDER:

                      
	 	 
	 	
                        JPMORGAN
                          CHASE BANK, NATIONAL 

                        ASSOCIATION,
                          individually
                          and as 

                        Administrative
                          Agent

                      
	 
 	 
 	 
 
	 	
                        By:   

                      	
                        /s/
                          Charles Kingswell-Smith

                      
	 	
                        Name:
                          Charles Kingswell-Smith

                      
	 	
                        Title:
                          Senior Vice
                          President

                      

              

            

          

        

      

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

     

    FORM
      OF SECOND LIEN CREDIT AGREEMENT AMENDMENT

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