Document:

Letter Agreement

 Exhibit 10.4 
 April 3, 2009 
 T. J. Thom 
 Energy Partners, Ltd.

 201 St. Charles Avenue, Suite 3400 
 New Orleans, Louisiana
70170 
  

	 	Re:	Credit Agreement dated as of April 23, 2007, among Energy Partners, Ltd., a Delaware corporation (the “Borrower”), Bank of America, N.A., as Administrative Agent,
Collateral Agent, and L/C Issuer (the “Administrative Agent”) and the Lenders party thereto (the “Lenders”) (as amended, the “Credit Agreement”). Capitalized terms used in this letter shall have the meanings given to
them in the Credit Agreement. 

 Dear Ms. Thom: 
 Background. The Borrower’s Borrowing Base was determined on March 11, 2009, pursuant to Section 2.15 of the Credit Agreement (the “Determination”). As a result of the
Determination, the Borrowing Base Deficiency is currently in the amount of $38,000,000. In accordance with Section 2.05 of the Credit Agreement, on March 23, 2009, Borrower provided the Administrative Agent a plan to reduce the
Borrowing Base Deficiency (the “Plan”). On March 24, 2009, the Administrative Agent, at the direction of the Lenders, notified the Borrower that the Plan was not approved. In accordance with Section 2.05, the
Borrower has until April 3, 2009, to pay the Borrowing Base Deficiency in full (the “Borrowing Base Deficiency Payment”). 
 Requested Consent. The Borrower requests that the due date for the Borrowing Base Deficiency Payment be extended until April 14, 2009 (the “Payment Extension”). Section 10.01 of the Credit Agreement
permits the Borrowing Base Deficiency Payment to be extended upon the written consent of the Required Lenders. 
 Representations and
Warranties. The Borrower represents and warrants to the Administrative Agent and the Lenders that (a) this consent agreement (this “Agreement”) is a Loan Document under the Credit Agreement and constitutes its legal, valid,
and binding obligation, enforceable in accordance with the terms hereof (subject as to enforcement of remedies to any Debtor Relief Laws), (b) the execution, delivery and performance by the Borrower and each other Loan Party of this Agreement,
and the consummation of the transactions contemplated thereby, do not and will not (i) require any consent, approval or license not already obtained, (ii) violate any applicable Law, or (iii) conflict with, result in a breach of, or
constitute a default under the organizational and governance documents of the Borrower or any other Loan Party, or under any material license, indenture, agreement or other instrument, to which the Borrower or any other Loan Party is a party or
beneficiary of, or by its collateral may be bound, (c) except as otherwise disclosed to the Administrative Agent and the 

 
Lenders, there has been no change, occurrence or development that has had a Material Adverse Effect, and (d) the Credit Agreement, as affected by this
Agreement, and the other Loan Documents remain in full force and effect and are hereby reaffirmed. 
 Acknowledgement of Existing
Defaults. Borrower acknowledges and agrees that certain Defaults have occurred as disclosed to the Administrative Agent (“Existing Defaults”). Borrower further acknowledges and agrees that the Administrative Agent’s and
each Required Lender’s execution of this Agreement is not a waiver of or forbearance in any manner with respect to the Existing Defaults and as such, the Administrative Agent and each Lender has all rights and remedies afforded to them under
the Loan Documents, at Law or in equity, and nothing contained herein shall prohibit or affect the Administrative Agent or any Lender in exercising such rights and remedies. 
 Consent. Notwithstanding anything to the contrary in the Credit Agreement and subject to the effectiveness of this Agreement, the Required Lenders
hereby consent to and expressly permit the Payment Extension subject to the conditions that (a) except for the Existing Defaults, all conditions, obligations and covenants of the Borrower and each other Loan Party under the Credit Agreement,
the other Loan Documents and herein are and shall continue to be complied with, and (b) each representation and warranty contained herein shall be true and correct on the date hereof. 
 Conditions Precedent. This Agreement shall not be effective until the Administrative Agent shall have received counterparts of this Agreement
executed by the Borrower, each other Loan Party, the Administrative Agent and the Required Lenders. 
 Release. As a material part of
the consideration for the Administrative Agent and the Required Lenders entering into this Agreement, Borrower and each Loan Party signing this Agreement (collectively “Releasor”) agree as follows (the “Release
Provision”): 
 (a) Releasor hereby releases and forever discharges the Administrative Agent and each Lender and the
Administrative Agent’s and each Lender’s predecessors, successors, assigns, officers, managers, directors, shareholders, employees, agents, attorneys, representatives, parent corporations, subsidiaries, and affiliates (hereinafter all of
the above collectively referred to as “Lender Group”) jointly and severally from any and all claims, counterclaims, demands, damages, debts, agreements, covenants, suits, contracts, obligations, liabilities, accounts, offsets,
rights, actions, and causes of action of any nature whatsoever occurring prior to the date hereof and relating to any of the Loan Documents or the transactions contemplated thereby, including, without limitation, all claims, demands, and causes of
action for contribution and indemnity, whether arising at Law or in equity, presently possessed, whether known or unknown, whether liability be direct or indirect, liquidated or unliquidated, presently accrued, whether absolute or contingent,
foreseen or unforeseen, and whether or not heretofore asserted (“Claims”), which Releasor may have or claim to have against any of Lender Group; except, as to any member of Lender Group, to the extent that any such Claims results
from any of gross negligence or willful misconduct of that member. 
  

 2 

 (b) Releasor agrees not to sue any of Lender Group or in any way assist any other person
or entity in suing Lender Group with respect to any claim released herein. The Release Provision may be pleaded as a full and complete defense to, and may be used as the basis for an injunction against, any action, suit, or other proceeding which
may be instituted, prosecuted, or attempted in breach of the release contained herein. 
 (c) Releasor acknowledges, warrants,
and represents to Lender Group that: 
 (i) Releasor has read and understands the effect of the Release Provision. Releasor
has had the assistance of independent counsel of its own choice, or has had the opportunity to retain such independent counsel, in reviewing, discussing, and considering all the terms of the Release Provision; and if counsel was retained, counsel
for Releasor has read and considered the Release Provision and advised Releasor to execute the same. Before execution of this Agreement, Releasor has had adequate opportunity to make whatever investigation or inquiry it may deem necessary or
desirable in connection with the subject matter of the Release Provision. 
 (ii) Releasor is not acting in reliance on any
representation, understanding, or agreement not expressly set forth herein. Releasor acknowledges that Lender Group has not made any representation with respect to the Release Provision except as expressly set forth herein. 
 (iii) Releasor has executed this Agreement and the Release Provision thereof as its free and voluntary act, without any duress, coercion,
or undue influence exerted by or on behalf of any person. 
 (iv) Releasor is the sole owner of the claims released by the
Release Provision, and Releasor has not heretofore conveyed or assigned any interest in any such claims to any other person or entity. 
 (d) Releasor understands that the Release Provision was a material consideration in the agreement of the Administrative Agent and each Required Lender to enter into this Agreement. 
 (e) It is the express intent of Releasor that the release and discharge set forth in the Release Provision be construed as broadly as
possible in favor of Lender Group so as to foreclose forever the assertion by Releasor of any claims released hereby against Lender Group. 
 (f) If any term, provision, covenant, or condition of the Release Provision is held by a court of competent jurisdiction to be invalid, illegal, or unenforceable, the remainder of the provisions shall remain in full
force and effect. 
 Counterparts. This Agreement may be executed in any number of counterparts by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute one and the same instrument. Telecopies of signatures shall be binding and effective as originals.

  

 3 

 Not a Waiver. Nothing contained in this Agreement shall be construed as a waiver of any Event of
Default or a consent to any action or inaction by the Borrower or any other Loan Party, other than as expressed by the terms herein nor shall it be construed as a course of dealing or conduct on the part of the Administrative Agent or any Lender.
All rights and remedies now or hereafter available to the Administrative Agent or any Lender are hereby reserved. 
 THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES REGARDING THE SUBJECT MATTER HEREIN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN
ORAL AGREEMENTS BETWEEN THE PARTIES. 
 [Remainder of the Page Intentionally Left Blank. 
 Signature Pages to Follow.] 
  

 4 

			
	 ADMINISTRATIVE AGENT:
  
 BANK OF AMERICA, N.A., as Administrative Agent

		
	By:	 	/s/ Kathleen M. Carry
	Name:	 	Kathleen M. Carry
	Title:	 	Vice President

  

 Signature Page to Consent Agreement 

			
	 BANK OF AMERICA, N.A., as a Lender,
 Collateral Agent and L/C Issuer

		
	By:	 	/s/ Tyler D. Levings
	Name:	 	Tyler D. Levings
	Title:	 	Senior Vice President

  

 Signature Page to Consent Agreement 

			
	BANK OF MONTREAL, as a Lender
		
	By:	 	 
	Name:	 	 
	Title:	 	 

  

 Signature Page to Consent Agreement 

			
	BNP PARIBAS, as a Lender
		
	By:	 	/s/ Amy Kirshner
	Name:	 	Amy Kirshner
	Title:	 	Managing Director
		
	By:	 	/s/ Albert A. Young, Jr.
	Name:	 	Albert A. Young, Jr.
	Title:	 	Managing Director

  

 Signature Page to Consent Agreement 

			
	 CALYON NEW YORK BRANCH, as a Lender

		
	 By:
	 	 
	 Name:
	 	 
	Title:	 	 

  
  
  
  

 Signature Page to Consent Agreement 

			
	FORTIS CAPITAL CORP., as a Lender
		
	 By:
	 	 
	 Name:
	 	 
	Title:	 	 

  

 Signature Page to Consent Agreement 

			
	JPMORGAN CHASE BANK NA, as a Lender 
		
	By:	 	/s/ John Runger
	Name:	 	John Runger
	Title:	 	Managing Director

  

 Exhibit C to Consent Agreement 

			
	BANK OF NOVA SCOTIA, as a Lender
		
	 By:
	 	 
	 Name:
	 	 
	Title:	 	 

  

 Signature Page to Consent Agreement 

			
	SOCIÉTÉ GÉNÉRALE, as a Lender
		
	By:	 	/s/ Kevin C. Joyce
	Name:	 	Kevin C. Joyce
	Title:	 	Vice President

  

 Signature Page to Consent Agreement 

			
	U.S. BANK NATIONAL ASSOCIATION, as a Lender
		
	By:	 	/s/ Monte E. Deckerd
	Name:	 	Monte E. Deckerd
	Title:	 	Senior Vice President

  

 Signature Page to Consent Agreement 

			
	ACKNOWLEDGED AND AGREED:
	
	BORROWER:
	
	ENERGY PARTNERS, LTD.
		
	By:	 	/s/ T. J. Thom
	Name:	 	T. J. Thom
	Title:	 	Vice President—Treasurer

  

 Signature Page to Consent Agreement 

 Each Loan Party (a) consents and agrees to the terms of this Agreement and all other Loan Documents
executed in connection therewith, (b) affirms that nothing contained in this Agreement shall modify in any respect whatsoever its obligations under the Guarantee and Collateral Agreement, (c) agrees that the “Obligations” as
defined in the Guarantee and Collateral Agreement shall include without limitation, the indebtedness and obligations of the Borrower and the Loan Parties under the Loan Documents, including the Credit Agreement as amended hereby, and (d) agrees
that the Guarantee and Collateral Agreement remains in full force and effect, continues to be legal, valid, binding, and enforceable in accordance with its terms, and that such Guarantee and Collateral Agreement guarantees the repayment of the
Obligations, and all renewals, extensions, and modifications thereof, in accordance with, and to the extent of, the terms of the Guarantee and Collateral Agreement. 
  

			
	 EPL OF LOUISIANA, L.L.C.,
 a Louisiana
limited liability company

		
	By:	 	/s/ T. J. Thom
		 	T. J. Thom, Vice President – Treasurer

  

			
	 DELAWARE EPL OF TEXAS, LLC,
 a Delaware
limited liability company

		
	By:	 	/s/ Paul B. Jones
		 	Paul Jones, President

  

			
	 EPL PIPELINE, L.L.C.,
 a Delaware limited
liability company

		
	By:	 	/s/ T. J. Thom
		 	T. J. Thom, Vice President – Treasurer

  

			
	 NIGHTHAWK, L.L.C.,
 a Louisiana limited
liability company

		
	By:	 	/s/ T. J. Thom
		 	T. J. Thom, Vice President – Treasurer

  

			
	 EPL PIONEER HOUSTON, INC.,
 a Texas
corporation

		
	By:	 	/s/ T. J. Thom
		 	T. J. Thom, Vice President – Treasurer

  

 Signature Page to Consent AgreementTerm Sheet

 Exhibit 10.6 
 CONFIDENTIAL – DO NOT DISCLOSE 
 SENT PURSUANT TO ONGOING SETTLEMENT DISCUSSIONS

 NOT ADMISSIBLE IN ANY CAUSE, MATTER OR PROCEEDING 
 EAST BAY P&A SECURITY/FUNDING 
 This term sheet (the “Term Sheet”) is between
Energy Partners, Ltd. and the United States Department of the Interior, Minerals Management Service, and sets forth the general terms and conditions of a prospective structure for the establishment of additional financial security for certain East
Bay properties. This Term Sheet is in the nature of compromise and settlement negotiations, but shall be binding upon Energy Partners, Ltd. and the United States Department of the Interior, Minerals Management Service, for the express purposes
stated herein, but not otherwise. Furthermore, this Term Sheet is subject to all disclaimers and limitations set forth herein. 
  

			
	 EPL or Debtor
	  	Energy Partners, Ltd. and its subsidiaries
		
	 MMS
	  	The United States Department of the Interior, Minerals Management Service.
		
	 Trustee
	  	JP Morgan Chase Bank, N.A.
		
	 East Bay
	  	EPL’s interest in Lease OCS-00352 (Portion of South Pass Block 27), Lease OCS-00353 (Portion of South Pass Block 28), Lease OCS-00693 (Portion of South Pass Block 27), and Lease OCS-00694
(Portion of South Pass Block 28).
		
	 Trust Agreement
	  	That certain Decommissioning Trust Agreement, dated effective December 23, 2008, covering East Bay, by and among EPL, MMS, and Trustee.
		
	 Trust Account
	  	Account number xxxxx7851, established at Trustee.
		
	 MMS Order
	  	That certain Order, dated March 23, 2009, issued by the MMS to EPL, which superseded an Order from the MMS issued March 20, 2009, issued in response to the failure of EPL to timely fund the
remaining deposit pursuant to the Trust Agreement, and which, inter alia, (i) ordered a shut-in of Debtor’s East Bay wells and facilities, and (ii) created an area-wide bond demand in the amount of $37,735,000.
		
	 Ad Hoc Committee
	  	That certain Ad Hoc Committee of Noteholders representing in excess of 66 and 2/3% in principal amount of the $450 million in outstanding notes issued by EPL under an Indenture dated as of April
23, 2007.
		
	 Bank Group
	  	That certain group of banks participating in EPL’s credit facility dated April 23, 2007, with Bank of America, N.A. acting as administrative agent.

  

 1 

 CONFIDENTIAL – DO NOT DISCLOSE 
 SENT PURSUANT TO ONGOING SETTLEMENT DISCUSSIONS 
 NOT ADMISSIBLE IN ANY CAUSE, MATTER OR PROCEEDING 
  

			
		
	 Plan Support
 Agreement
	  	If requested, EPL and the MMS both agree to execute a reasonable plan support agreement with certain of the other interested constituencies of EPL in an effort to merge the terms hereof with
additional Plan provisions required for a complete and consensual reorganization.
		
	 Commencement
 Date
	  	The date that EPL will file for bankruptcy protection under chapter 11 of title 11 of the United States Code.
		
	 Plan
	  	EPL shall incorporate the terms hereof (or similar terms acceptable to EPL and the MMS) into a consensual Plan, which shall be supported by the MMS. Such support shall include (i) voting in
favor of the Plan (if needed), conditioned upon the approval of a disclosure statement, and (ii) supporting EPL’s efforts to obtain confirmation of the Plan.
		
	 Effective Date
	  	The date on which the consensual Plan is consummated.
		
	 Bankruptcy Case
 Issues and Terms of
 MMS Plan
 Treatment
	  	 Subject to Bankruptcy Court approval, where appropriate:
  
 a. With the exception of the sixth paragraph of the MMS Order, which pertains to the “shut-in of all OCS facilities located on and all OCS wells associated with
South Pass Block Nos. 27 and 28, while properly maintaining said facilities and wells and essential personnel,” MMS shall grant a consensual stay of the MMS Order, commencing on the Commencement Date, and remaining in place during EPL’s
bankruptcy proceeding;
  
 b. EPL shall pay into the Trust Account $1,202,333.33 million on
the last day of each calendar month during EPL’s bankruptcy proceeding (including a $1,202,333.33 payment on April 30, 2009; collectively, the “Adequate Protection Payments”) as adequate protection for the claims asserted by the
MMS, whether such claims are included within the MMS Order or otherwise;
  
 c. MMS and EPL
shall re-affirm the terms and conditions of the Trust Agreement and shall attach a new Schedule A (Funding Obligations) thereto, which shall (i) include references to all Adequate Protection Payments made and (ii) require a payment into the Trust
Account on the Effective Date equal to (x) $21 million minus (y) the sum total of all Adequate Protection Payments that are made prior to the time EPL emerges from bankruptcy. EPL’s Plan will also require EPL to pay any remaining unpaid balance
of the “Funding Cap” described on Schedule A, which payments will be made in equal quarterly installments of $1,202,333.33, commencing October 31, 2009;1

  

	1	A replacement Schedule A contemplating a projected July 31, 2009 order confirming the Plan is attached hereto. 

  

 2 

 CONFIDENTIAL – DO NOT DISCLOSE 
 SENT PURSUANT TO ONGOING SETTLEMENT DISCUSSIONS 
 NOT ADMISSIBLE IN ANY CAUSE, MATTER OR PROCEEDING 
  

			
		
		  	  
 d. EPL shall assume, to the extent 11 USC §365 applies, all of its OCS
leases granted by and through MMS;
  
 e. On the Effective Date, the MMS shall release and
cancel Bond No. RLB0001113 in the amount of $3 million;
  
 f. MMS shall support EPL’s
efforts to obtain expedited approval of a disclosure statement and Plan incorporating the terms hereof;
  
 g. EPL will continue with its ordinary course decommissioning activities and its “Idle Iron” activities, specifically including such activities in East Bay;
  
 h. Consistent with paragraph a., above, and continuing until the Effective Date, EPL shall continue
with the shut-in of its OCS facilities located on and all OCS wells associated with South Pass Block Nos. 27 and 28, while properly maintaining said facilities and wells and essential personnel;2
  
 i. On the Effective Date, EPL shall be allowed to resume production associated with its OCS facilities located on and all OCS wells associated with South Pass Block Nos. 27 and 28; and
  
 j. On the Effective Date, in consideration for the Plan treatment outlined herein, the MMS Order
shall be rescinded.

			
		
	 Further MMS
 Review
	 	MMS agrees to review appropriate financial data on the reorganized EPL, when same becomes available, to analyze whether the reorganized EPL qualifies for a waiver of supplemental bond
requirements.
		
	 Disclaimers, Etc.
	 	This Term Sheet is intended to outline certain basic terms of the transactions contemplated hereby based upon information presently available. It is not intended to be definitive and further
negotiations regarding the Plan are anticipated. This Term Sheet is for discussion purposes only and is not an offer to enter into a contract. The transactions contemplated hereby require internal approvals from the EPL and the MMS, and will need to
compliment treatment of and provisions relating to the Noteholders and the Bank Group pursuant to the Plan. Consequently, the terms hereof are dependent upon EPL receiving satisfactory Plan support commitments from the Bank Group and the Ad Hoc
Committee.

  

	2	EPL reserves the right to petition the Bankruptcy Court for relief from this provision solely to protect its leasehold rights which may be impacted by non-production for six
consecutive months, or as otherwise provided by law or regulation. 

  

 3 

 CONFIDENTIAL – DO NOT DISCLOSE 
 SENT PURSUANT TO ONGOING SETTLEMENT DISCUSSIONS 
 NOT ADMISSIBLE IN ANY CAUSE, MATTER OR PROCEEDING 
  

			
		
		 	This Term Sheet does not constitute a commitment to lend or restructure and is in the nature of settlement discussions and shall accordingly not be admissible as evidence and is entitled to the
protections of Federal Rule of Evidence 408 and any other applicable statutes or doctrines protecting the use or disclosure of confidential information and information exchanged in the context of settlement discussions. This Term Sheet is provided
on a confidential basis, and both EPL and the MMS are not authorized to disclose this Term Sheet to any other person or entity other than its professional advisors, who are also required as a matter of settlement negotiations to maintain its
confidentiality, unless such disclosure is (i) approved by the other party hereto, or (ii) to the Bank Group or the Ad Hoc Committee and their respective advisors. This Term Sheet is otherwise subject to the requirements of the Bankruptcy Code and
Rules and shall be conditioned upon approval by the Bankruptcy Court as necessary.

 Agreed to and accepted this 30th day of April, 2009. 
 ENERGY
PARTNERS, LTD. 
  

			
	 By:
	 	 /s/ John H. Peper

	 Name:
	 	 John H. Peper

	 Title:
	 	 Executive Vice President, Corporate Secretary

 Agreed to and accepted this              day of
April, 2009. 
 THE UNITED STATES DEPARTMENT OF THE INTERIOR, 
 BY AND THROUGH THE MINERALS MANAGEMENT SERVICE 
  

			
	 By:
	 	 /s/ John Rodi

	 Name:
	 	 for Lars Herbst

	 Title:
	 	 MMS GOMR Regional Director

  

 4 

 CONFIDENTIAL – DO NOT DISCLOSE 
 SENT PURSUANT TO ONGOING SETTLEMENT DISCUSSIONS 
 NOT ADMISSIBLE IN ANY CAUSE, MATTER OR PROCEEDING 
  

 Schedule A 
 Funding Obligations 
 Funding Cap: 
  

				
	 Lease OCS-00352:
	  	$	 260,000
	 Lease OCS-00353:
	  	$	12,040,000
	 Lease OCS-00693:
	  	$	1,380,000
	 Lease OCS-00694:
	  	$	22,390,000
		  	 	 
		  	$	36,070,000

 Deposit: 
 Comprised of the following: 
  

			
	 $1,335,000
	 	paid by wire transfer on December 23, 2008
		
	 $1,202,333.33
	 	paid by wire transfer on or about March 31, 2009
		
	 $1,202,333.33
	 	paid by wire transfer on April 29, 2009
		
	 $1,202,333.33
	 	to be paid by wire transfer on the last business day of each calendar month starting May 31, 2009 and ending [July 31, 2009]
		
	 [$16,190,666.68]
	 	to be satisfied on or about [August 31, 2009], or at some other time mandated by other agreements by and among the parties

 Quarterly Payments: 
 The remaining amount of $             necessary to reach the Funding Cap shall be paid in quarterly payments of $1,202,333.33, commencing on October 31, 2009

 Adjustment to Funding Cap: 
 As decommissioning work is
performed on the Properties by Settlor, and subject to applicable regulation, the Funding Cap shall be adjusted downward dollar for dollar for all such decommissioning associated with the Property, as assessed by MMS; provided, however, any
reduction in the Funding Cap shall not diminish the quarterly payment amount of $1,202,333.33 until the remaining balance owed to reach the Funding Cap is less than $1,202,333.33 
  

 5 

 CONFIDENTIAL – DO NOT DISCLOSE 
 SENT PURSUANT TO ONGOING SETTLEMENT DISCUSSIONS 
 NOT ADMISSIBLE IN ANY CAUSE, MATTER OR PROCEEDING 
  

 Additional Credits: 
 Settlor shall receive a dollar for dollar credit against the Funding Cap for any Third Party Indemnity Agreement posted in favor of the Beneficiary by Devon (or another entity acceptable to and qualified with the MMS) and/or a dollar for
dollar credit for any other acceptable form of security as may be presented by Settlor to Beneficiary 
 Miscellaneous: 
 All deposits/payment obligations created hereby shall be the general corporate obligations of Settlor and shall not be tied to production from the Property or from any of
its other oil and gas interests 
  

 6

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