Document:

EXHIBIT 10.2

 

GUARANTY AND SURETYSHIP AGREEMENT

 

THIS GUARANTY AND SURETYSHIP AGREEMENT (this “Guaranty”), dated as of the 26th day of June, 2015, made by THE BON-TON STORES, INC., a Pennsylvania corporation, THE BON-TON DEPARTMENT STORES, INC., a Pennsylvania corporation and CARSON PIRIE SCOTT II, INC., a Florida corporation (individually and collectively referred to herein as “Guarantor”), to BT (MULTI) LLC, a Delaware limited liability company (“Landlord”).

 

W I T N E S S E T H :

 

WHEREAS, Landlord, as lessor, has entered into a Lease Agreement of even date herewith (the “Lease”), in which Landlord leased to McRIL LLC, a Virginia limited liability company (“Tenant”), certain premises situate in Joliet, Illinois, Fargo, North Dakota, Ashwaubenon, Wisconsin, Brookfield, Wisconsin, Greendale, Wisconsin and Wauwatosa, Wisconsin as more particularly described in the Lease (the “Leased Premises”); and

 

WHEREAS, the execution and delivery by Guarantor of this Guaranty is a material inducement to Landlord to execute the Lease, and Guarantor expects to derive financial benefit from the Lease.

 

NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt of which is hereby acknowledged by Guarantor, and intending to be legally bound, Guarantor hereby covenants and agrees as follows:

 

ARTICLE I
 GUARANTEE

 

Section 1.01                             Guaranteed Obligations.  Guarantor hereby jointly and severally absolutely unconditionally and irrevocably guarantees to and becomes surety for Landlord and its successors and assigns for the due, punctual and full payment, performance and observance of, and covenants with Landlord to duly, punctually and fully pay and perform, the following (collectively, the “Guaranteed Obligations”):

 

(a)                                 the full and timely payment of all Rent and all other amounts due or to become due to Landlord from Tenant under the Lease or any other agreement or instrument executed in connection therewith, including without limitation the Seller/Lessee’s Certificate of even date therewith in favor of Landlord, whether now existing or hereafter arising, contracted or incurred (collectively, the “Monetary Obligations”); and

 

(b)                                 all covenants, agreements, terms, obligations and conditions, undertakings, duties, representations and warranties contained in the Lease to be observed, performed by or imposed upon Tenant under the Lease, whether now existing or hereafter arising, contracted or

 

 

incurred (collectively, the “Performance Obligations”),  as and when such payment, performance or observance shall become due (whether by acceleration or otherwise) in accordance with the terms of the Lease, which terms are incorporated herein by reference.  The Guaranteed Obligations shall not be affected by the Tenant’s voluntary or involuntary bankruptcy, assignment for the benefit of creditors reorganization or similar proceeding affecting the Tenant.  If for any reason any Monetary Obligation shall not be paid promptly when due, Guarantor shall, immediately upon demand, pay the same to Landlord when due under the terms of the Lease.  If for any reason Tenant shall fail to perform or observe any Performance Obligation, Guarantor shall, immediately upon demand, perform and observe the same or cause the same to be performed or observed.  If, by reason of any bankruptcy, insolvency or similar laws affecting the rights of creditors, Landlord shall be prohibited from exercising any of Landlord’s rights and remedies, including, but not limited to, enforcement of the terms of the Lease against the Tenant, then as to Guarantor such prohibition shall be of no force and effect, and Landlord shall have the right to make demand upon, and receive payment and/or performance from Guarantor of all Guaranteed Obligations and Guarantor’s obligation in this respect shall be primary and not secondary.  Guarantor acknowledges and agrees that the Monetary Obligations include, without limitation, Rent and other sums accruing and/or becoming due under the Lease following the commencement by or against Tenant of any action under the United States Bankruptcy Code or other similar statute.  Guarantor shall pay all Monetary Obligations to Landlord at the address and in the manner set forth in the Lease or at such other address as Landlord shall notify Guarantor in writing.

 

Section 1.02                             Guarantee Unconditional.  The obligations of Guarantor hereunder are continuing, absolute and unconditional, irrespective of any circumstance whatsoever which might otherwise constitute a legal or equitable discharge or defense of a guarantor or surety.  Without limiting the generality of the foregoing, the obligations of Guarantor hereunder shall remain in full force and effect without regard to, and shall not be released, discharged, abated, impaired or in any way affected by:

 

(a)                                 any amendment, modification, extension, renewal or supplement to the Lease or any termination of the Lease or any interest therein;

 

(b)                                 any assumption by any party of Tenant’s or any other party’s obligations under, or Tenant’s or any other party’s assignment of any of its interest in, the Lease;

 

(c)                                  any exercise or nonexercise of or delay in exercising any right, remedy, power or privilege under or in respect of this Guaranty or the Lease or pursuant to applicable law (even if any such right, remedy, power or privilege shall be lost thereby), including, without limitation, any so-called self-help remedies, or any waiver, consent, compromise, settlement, indulgence or other action or inaction in respect thereof;

 

(d)                                 any change in the financial condition of Tenant, the voluntary or involuntary liquidation, dissolution, sale of all or substantially all of the assets, marshalling of assets and liabilities, receivership, conservatorship, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of, or other

 

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similar proceeding affecting Landlord, Tenant or Guarantor or any of their assets or any impairment, modification, release or limitation of liability of Landlord, Tenant or Guarantor or their respective estates in bankruptcy or of any remedy for the enforcement of such liability resulting from the operation of any present or future provision of the United States Bankruptcy Code or other similar statute or from the decision of any court;

 

(e)                                  any extension of time for payment or performance of the Guaranteed Obligations or any part thereof;

 

(f)                                   the genuineness, invalidity or unenforceability of all or any portion or provision of the Lease;

 

(g)                                  any defense that may arise by reason of the failure of Landlord to file or enforce a claim against the estate of Tenant in any bankruptcy or other proceeding;

 

(h)                                 the release or discharge of or accord and satisfaction with of Tenant or any other person or entity from performance or observance of any of the agreements, covenants, terms or conditions contained in the Lease by operation of law or otherwise;

 

(i)                                     the failure of Landlord to keep Guarantor advised of Tenant’s financial condition, regardless of the existence of any duty to do so;

 

(j)                                    any assignment by Landlord of all of Landlord’s right, title and interest in, to and under the Lease and/or this Guaranty as collateral security for any Loan;

 

(k)                                 any present or future law or order of any government (de jure or de facto) or of any agency thereof purporting to reduce, amend or otherwise affect the Guaranteed Obligations or any or all of the obligations, covenants or agreements of Tenant under the Lease (except by payment in full of all Guaranteed Obligations) or Guarantor under this Guaranty (except by payment in full of all Guaranteed Obligations);

 

(l)                                     the default or failure of Guarantor fully to perform any of its obligations set forth in this Guaranty;

 

(m)                             any actual, purported or attempted sale, assignment or other transfer by Landlord of the Lease or the Leased Premises or any part thereof or of any of its rights, interests or obligations thereunder;

 

(n)                                 any merger or consolidation of Tenant into or with any other entity, or any sale, lease, transfer or other disposition of any or all of Tenant’s assets or any sale, transfer or other disposition of any or all of the shares of capital stock or other securities of Tenant or any affiliate of Tenant to any other person or entity;

 

(o)                                 Tenant’s failure to obtain, protect, preserve or enforce any rights in or to the Lease or the Leased Premises or any interest therein against any party or the invalidity or unenforceability of any such rights; or

 

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(p)                                 any other event, action, omission or circumstances which might in any manner or to any extent impose any risk to Guarantor or which might otherwise constitute a legal or equitable release or discharge of a guarantor or surety.

 

all of which may be given or done without notice to, or consent of, Guarantor.

 

No setoff, claim, reduction or diminution of any obligation, or any defense of any kind or nature which Tenant or Guarantor now has or hereafter may have against Landlord shall be available hereunder to Guarantor against Landlord.

 

Section 1.03                             Disaffirmance of Lease.  Guarantor agrees that, in the event of rejection or disaffirmance of the Lease by Tenant or Tenant’s trustee in bankruptcy pursuant to the United States Bankruptcy Code or any other law, Guarantor will, if Landlord so requests, assume all obligations and liabilities under the express terms of the Lease, to the same extent as if Guarantor had been originally named instead of Tenant as a party to the Lease and there had been no rejection or disaffirmance; and Guarantor will confirm such assumption in writing at the request of Landlord on or after such rejection or disaffirmance.  Guarantor, upon such assumption, shall have all rights of Tenant under the Lease (to the extent permitted by law).

 

Section 1.04                             No Notice or Duty to Exhaust Remedies.  Guarantor hereby waives notice of any default in the payment or non-performance of any of the Guaranteed Obligations (except as expressly required hereunder), diligence, presentment, demand, protest and all notices of any kind.  Guarantor agrees that liability under this Guaranty shall be primary and hereby waives any requirement that Landlord exhaust any right or remedy, or proceed first or at any time, against Tenant or any other guarantor of, or any security for, any of the Guaranteed Obligations.  Guarantor hereby waives notice of any acceptance of this Guaranty and all matters and rights which may be raised in avoidance of, or in defense against, any action to enforce the obligations of Guarantor hereunder.  Guarantor hereby waives any and all suretyship defenses or defenses in the nature thereof without in any manner limiting any other provision of this Guaranty.  This Guaranty constitutes an agreement of suretyship as well as of guaranty, and Landlord may pursue its rights and remedies under this Guaranty and under the Lease in whatever order, or collectively, and shall be entitled to payment and performance hereunder notwithstanding any action taken by Landlord or inaction by Landlord to enforce any of its rights or remedies against any other guarantor, person, entity or property whatsoever.  This Guaranty is a guaranty of payment and performance and not merely of collection.

 

Landlord may pursue its rights and remedies under this Guaranty notwithstanding any other guarantor of or security for the Guaranteed Obligations or any part thereof.  Guarantor authorizes Landlord, at its sole option, without notice or demand and without affecting the liability of Guarantor under this Guaranty, to terminate the Lease, either in whole or in part, in accordance with its terms.

 

Each default on any of the Guaranteed Obligations shall give rise to a separate cause of action and separate suits may be brought hereunder as each cause of action arises or, at the option of

 

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Landlord any and all causes of action which arise prior to or after any suit is commenced hereunder may be included in such suit.

 

Section 1.05                             Subrogation.  Notwithstanding any payments made or obligations performed by Guarantor by reason of this Guaranty (including but not limited to application of funds on account of such payments or obligations), Guarantor hereby irrevocably waives and releases any and all rights it may have, at any time, whether arising directly or indirectly, by operation of law, contract or otherwise, to assert any claim against Tenant or any other person or entity or against any direct or indirect security on account of payments made or obligations performed under or pursuant to this Guaranty, including without limitation any and all rights of subrogation, reimbursement, exoneration, contribution or indemnity, and any and all rights that would result in Guarantor being deemed a “creditor” under the United States Bankruptcy Code of Tenant or any other person or entity.    If any payment shall be paid to Guarantor on account of any subrogation rights, each and every amount so paid shall immediately be paid to Landlord to be credited and applied upon any of the Guaranteed Obligations, whether or not then due and payable.  Every claim or demand which Guarantor may have against Tenant shall be fully subordinate to all Guaranteed Obligations.

 

ARTICLE II
  REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Section 2.01                             Representations and Warranties.  The representations and warranties made by Guarantor in that certain Guarantor’s Certificate of even date herewith made by Guarantor in favor of Landlord are hereby incorporated by reference herein (with all related definitions).  Guarantor hereby represents and warrants to Landlord as provided therein.

 

Section 2.02                             Financial Statements; Books and Records.

 

(a)                                 Guarantor shall keep adequate records and books of account with respect to the finances and business of Guarantor generally and with respect to the Leased Premises,  in accordance with generally accepted accounting principles (“GAAP”) consistently applied, and shall permit Landlord and Lender by their respective agents, accountants and attorneys, upon reasonable notice to Guarantor, to examine (and make copies of) the records and books of account and to discuss the finances and business with the officers of Guarantor, at such reasonable times as may be requested by Landlord or Lender.  Upon the request of Lender or Landlord (either telephonically or in writing), Guarantor shall provide the requesting party with copies of any information to which such party would be entitled in the course of a personal visit.

 

(b)                                 Guarantor shall deliver to Landlord and to Lender within ninety (90) days of the close of each fiscal year, annual audited financial statements of Guarantor prepared by nationally recognized independent certified public accountants.  Guarantor shall also furnish to Landlord within forty-five (45) days after the end of each of the three remaining fiscal quarters unaudited financial statements and all other quarterly reports of Guarantor, certified by Guarantor’s chief financial officer, and all filings, if any, of Form 10-K, Form 10-Q and other required filings with the Securities and Exchange Commission pursuant to the provisions of the

 

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Securities Exchange Act of 1934, as amended, or any other Law.  All financial statements of Guarantor shall be prepared in accordance with GAAP consistently applied.  All annual financial statements shall be accompanied (i) by an opinion of said accountants which (A) contains no qualifications as to the scope of the audit and (B) states the audit was performed in accordance with the standards set by the Public Company Accounting Oversight Board (United States) and (ii) by the affidavit of the president or a vice president of Guarantor, dated within five (5) days of the delivery of such statement, stating that (1) the affiant knows of no Event of Default, or event which, upon notice or the passage of time or both, would become an Event of Default which has occurred and is continuing hereunder or, if any such event has occurred and is continuing, specifying the nature and period of existence thereof and what action Guarantor has taken or proposes to take with respect thereto and (2) except as otherwise specified in such affidavit, that Guarantor has fulfilled all of its obligations under this Guaranty which are required to be fulfilled on or prior to the date of such affidavit. Notwithstanding any of the foregoing to the contrary, so long as BONT is a public company and the consolidated quarterly and annual financials of Tenant Group (which must include Tenant as a part of the Tenant Group)  which Tenant would be otherwise required to cause to be delivered hereinabove are available to Landlord via EDGAR or other online service at no material cost to Landlord, then Landlord agrees that it shall obtain such quarterly and annual financials through such service and Guarantor shall not be required to make the physical deliveries required hereinabove.

 

Section 2.03                             Notice of Certain Events.  Promptly upon becoming aware thereof, Guarantor shall give Landlord notice of (i) the commencement, existence or threat of any proceeding by or before any duly constituted governmental authority or agency against or affecting Guarantor which, if adversely decided, would have a material adverse effect on the business, operations or condition, financial or otherwise, of Guarantor or on its ability to perform its obligations hereunder or (ii) any material adverse change in  the business, operations or condition, financial or otherwise, of Guarantor.

 

Section 2.04                             Estoppel Certificates.  Guarantor shall, at any time upon not less than ten (10) days’ prior written request by Landlord or Lender, deliver to the party requesting the same a statement in writing, executed by the president or a vice president of Guarantor, certifying (i) that, except as otherwise specified, this Guaranty is unmodified and in full force in effect, (ii) that Guarantor is not in default hereunder and that no event has occurred or condition exists which with the giving of notice or the passage of time or both would constitute a default hereunder, (iii) that Guarantor has no defense, setoff or counterclaim against Landlord arising out of or in any way related to this Guaranty, (iv) that, except as otherwise specified, there are no proceedings pending or, to the knowledge of Guarantor, threatened against Guarantor before any court, arbiter or administrative agency which, if adversely decided, could have a material adverse effect on the business, operations or conditions, financial or otherwise, of Guarantor or on its ability to perform its obligations hereunder and (v) such other matters as Landlord or Lender may reasonably request.

 

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ARTICLE III
  EVENTS OF DEFAULT

 

Section 3.01                             Events of Default.  The occurrence of any one or more of the following shall constitute an “Event of Default” under this Guaranty:

 

(a)                                 a failure by Guarantor to make any payment of any Monetary Obligation, regardless of the reason for such failure;

 

(b)                                 a failure by Guarantor duly to perform and observe, or a violation or breach of, any other provision hereof not otherwise specifically mentioned in this Section 3.01;

 

(c)                                  any representation or warranty made by Guarantor herein or in any certificate, demand or request made pursuant hereto proves to be untrue or incorrect, now or hereafter, in any material respect;

 

(d)                                 a default beyond any applicable cure period or at maturity by Guarantor in any payment of principal or interest on any obligations for borrowed money having an original principal balance of $10,000,000.00 or more in the aggregate, or in the performance of any other provision contained in any instrument under which any such obligation is created or secured (including the breach of any covenant thereunder), (i) if, with respect to a payment default, such payment is a payment at maturity or a final payment, or (ii) if, with respect to any other default, an effect of such default is to cause, or permit any person to cause, such obligation to become due prior to its stated maturity;

 

(e)                                  a default by Guarantor beyond any applicable cure period in the payment of rent under, or in the performance of any other material provision of, any leases (excluding the Lease) that have, in the aggregate, rental obligations over the terms thereof of $5,000,000.00 or more;

 

(f)                                   a final, non-appealable judgment or judgments for the payment of money in excess of $5,000,000.00 in the aggregate shall be rendered against Guarantor and the same shall remain undischarged for a period of sixty (60) consecutive days;

 

(g)                                  Guarantor shall (A) voluntarily be adjudicated a bankrupt or insolvent, (B) seek or consent to the appointment of a receiver for itself or its assets, (C) file a petition seeking relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, (D) make a general assignment for the benefit of creditors, or (E) be unable to pay its debts as they mature;

 

(h)                                 a court shall enter an order, judgment or decree appointing, without the consent of Guarantor, a receiver or trustee for it or approving a petition filed against Guarantor which seeks relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, and such order, judgment or decree shall remain undischarged or unstayed sixty (60) days after it is entered;

 

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(i)                                     Guarantor shall be liquidated or dissolved or shall begin proceedings towards its liquidation or dissolution; or

 

(j)                                    Guarantor shall sell or transfer or enter into an agreement to sell or transfer all or substantially all of its assets, unless Purchaser or transferee has assumed all of the obligations of Guarantor under this Guaranty, pursuant to an assignment and assumption agreement satisfactory to Landlord.

 

ARTICLE IV
  MISCELLANEOUS

 

Section 4.01                             Effect Of Bankruptcy Proceedings.  This Guaranty shall continue to be effective, or be automatically reinstated, as the case may be, if at any time payment, in whole or in part, of any of the Guaranteed Obligations is rescinded or must otherwise be restored or returned by Landlord as a preference, fraudulent conveyance or otherwise under any bankruptcy, insolvency or similar law, all as though such payment had not been made.  Guarantor hereby agrees to indemnify Landlord against, and to save and hold Landlord harmless from any required return by Landlord, or recovery from Landlord, of any such payment because of its being deemed preferential under applicable bankruptcy, receivership or insolvency laws, or for any other reason.  If an Event of Default at any time shall have occurred and be continuing or exist and declaration of default or acceleration under or with respect to the Lease shall at such time be prevented by reason of the pendency against Tenant of a case or proceeding under any bankruptcy or insolvency law, Guarantor agrees that, for purposes of this Guaranty and its obligations hereunder, the Lease shall be deemed to have been declared in default or accelerated with the same effect as if the Lease had been declared in default and accelerated in accordance with the terms thereof, and Guarantor shall forthwith pay and perform the Guaranteed Obligations in full without further notice or demand.

 

Section 4.02                             Further Assurances.  From time to time upon the request of Landlord, Guarantor shall promptly and duly execute, acknowledge and deliver any and all such further instruments and documents as Landlord may deem necessary or desirable to confirm this Guaranty, to carry out the purpose and intent hereof or to enable Landlord to enforce any of its rights hereunder.

 

Section 4.03                             Amendments, Waivers, Etc.  This Guaranty cannot be amended, modified, waived, changed, discharged or terminated except by an instrument in writing signed by the party against whom enforcement of such amendment, modification, waiver, change, discharge or termination is sought.

 

Section 4.04                             No Implied Waiver; Cumulative Remedies.  No course of dealing and no delay or failure of Landlord in exercising any right, power or privilege under this Guaranty or the Lease shall affect any other or future exercise thereof or exercise of any other right, power or privilege; nor shall any single or partial exercise of any such right, power or privilege or any abandonment or discontinuance of steps to enforce such a right, power or privilege preclude any further exercise thereof or of any other right, power or privilege.  The

 

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rights and remedies of Landlord under this Guaranty are cumulative and not exclusive of any rights or remedies which Landlord would otherwise have under the Lease, at law or in equity.

 

Section 4.05                             Notices.  All notices, requests, demands, directions and other communications (collectively “notices”) under the provisions of this Guaranty shall be in writing and shall be deemed to have been given and received for all purposes when delivered in person or by Federal Express or other reliable 24-hour delivery service or five (5) business days after being deposited in the United States mail, by registered or certified mail, return receipt requested, postage prepaid, addressed to the other party or when delivery is refused.  All notices shall be sent to the applicable party addressed, if to Landlord, at the address set forth in the Lease, and, if to Guarantor, at c/o The Bon-ton Stores Inc., 2801 East Market Street, York, PA 17402, Attention: Legal Department, or in accordance with the last unrevoked written direction from such party to the other party.

 

Section 4.06                             Expenses.  Guarantor agrees to pay or cause to be paid and to save Landlord harmless against liability for the payment of all reasonable out-of-pocket expenses, including fees and expenses of counsel for Landlord, incurred by Landlord from time to time arising in connection with Landlord’s enforcement or preservation of rights under this Guaranty or the Lease, including but not limited to such expenses as may be incurred by Landlord in connection with any default by Guarantor of any of its obligations hereunder or by Tenant of any of its obligations under the Lease.

 

Section 4.07                             Survival.  All obligations of Guarantor to make payments to or indemnify Landlord shall survive the payment and performance in full of the Guaranteed Obligations.

 

Section 4.08                             Severability.  If any term or provision of this Guaranty or the application thereof to any person or circumstance shall to any extent be invalid or unenforceable, the remainder of this Guaranty, or the application of such term or provision to persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each term and provision of this Guaranty shall be valid and enforceable to the fullest extent permitted by law.

 

Section 4.09                             Counterparts.  This Guaranty may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute but one and the same instrument.

 

Section 4.10                             Governing Law.  (a)     This Guaranty was negotiated in New York, and accepted by Landlord in the State of New York, which State the parties agree has a substantial relationship to the parties and to the underlying transaction embodied hereby, and in all respects, including, without limiting the generality of the foregoing, matters of construction, validity and performance, this Guaranty and the obligations arising hereunder shall be governed by, and construed in accordance with, the laws of the State of New York applicable to contract made and performed in such State and any applicable law of the United States of America.  To

 

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the fullest extent permitted by law, Guarantor hereby unconditionally and irrevocably waives any claim to assert that the law of any other jurisdiction governs this Guaranty, and the Guaranty shall be governed by and construed in accordance with the laws of the State of New York pursuant to § 5-1401 of the New York General Obligations Law.

 

(b)                                 Any legal suit, action or proceeding against Guarantor or Landlord arising out of or relating to this Guaranty shall be instituted in any federal or state court in New York, New York, pursuant to § 5-1402 of the New York General Obligations Law, and Guarantor waives any objection which it may now or hereafter have to the laying of venue of any such suit, action or proceeding and hereby irrevocably submits to the jurisdiction of any such court in any suit, action or proceeding.  Guarantor does hereby designate and appoint J. Gregory Yawman as its authorized agent to accept and acknowledge on its behalf service of any and all process which may be served in any such suit, action or proceeding in any federal or state court in New York, New York, and agrees that service of process upon said agent at said address (or at such other office in New York, New York as may be designated by Guarantor from time to time in accordance with the terms hereof) with a copy to :  Paul, Weiss, Rifkind, Wharton & Garrison, 1285 Avenue of the Americas, New York, NY 10019-6064, Attention: Harris Freidus, Esq., and written notice of said service of Guarantor mailed or delivered to Guarantor in the manner provided herein shall be deemed in every respect effective service of process upon Guarantor, in any such suit, action or proceeding in the State of New York.  Guarantor (i) shall give prompt notice to the Landlord of any change of address of its authorized agent hereunder, (ii) may at any time and from time to time designate a substitute authorized agent with an office in New York, New York (which office shall be designated as the address for service of process), and (iii) shall promptly designate such a substitute if its authorized agent ceases to have an office in New York, New York or is dissolved without leaving a successor.

 

Section 4.11                             Jury Trial.  GUARANTOR HEREBY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTER OF THIS GUARANTY.  THIS WAIVER IS KNOWINGLY, INTENTIONALLY, AND VOLUNTARILY MADE BY GUARANTOR, AND GUARANTOR ACKNOWLEDGES THAT THE LANDLORD HAS NOT MADE ANY REPRESENTATIONS OF FACT TO INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT.  GUARANTOR FURTHER ACKNOWLEDGES THAT GUARANTOR HAS BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF ALL WAIVERS CONTAINED HEREIN BY INDEPENDENT LEGAL COUNSEL, SELECTED BY GUARANTOR, AND GUARANTOR HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.

 

Section 4.12                             Successors and Assigns; Joint and Several.  This Guaranty shall bind Guarantor and its successors and assigns, and shall inure to the benefit of Landlord and its successors and assigns.  The obligations and liabilities of each Guarantor under this Guaranty shall be joint and several.  As used in this Guaranty, the singular shall include the plural and vice-versa.

 

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Section 4.13                             Incorporation of Recitals; Definitions.  The recitals set forth on page 1 of this Guaranty are hereby specifically incorporated into the operative terms of this Guaranty as if fully set forth.  Terms not otherwise specifically defined herein shall have the meanings set forth in the Lease.

 

Section 4.14                             Rights of Lender.  Guarantor acknowledges that the rights of Landlord under this Guaranty may be assigned to Lender and upon such assignment Lender shall have all of the rights and benefits of Landlord hereunder.

 

[NO FURTHER TEXT ON THIS PAGE]

 

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IN WITNESS WHEREOF, Guarantor has duly executed and delivered this Guaranty as of the date first above written.

 

 

	
ATTEST:
    	
 
    	
THE BON-TON   STORES, INC., a Pennsylvania corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/ J. Gregory Yawman
    	
 
    	
By:
    	
/s/ H. Todd Dissinger
    
	
 
    	
Name: J. Gregory Yawman
    	
 
    	
 
    	
Name: H. Todd Dissinger
    
	
 
    	
Title: Secretary
    	
 
    	
 
    	
Title: Senior Vice   President — Treasurer & Credit
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
ATTEST:
    	
 
    	
THE BON-TON DEPARTMENT   STORES, INC., a Pennsylvania corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/ J. Gregory Yawman
    	
 
    	
By:
    	
/s/ H. Todd Dissinger
    
	
 
    	
Name: J. Gregory Yawman
    	
 
    	
 
    	
Name: H. Todd Dissinger
    
	
 
    	
Title: Secretary
    	
 
    	
 
    	
Title: Senior Vice   President — Treasurer & Credit
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
ATTEST:
    	
 
    	
CARSON PIRIE SCOTT   II, INC., a Florida corporation
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/ J. Gregory Yawman
    	
 
    	
By:
    	
/s/ H. Todd Dissinger
    
	
 
    	
Name: J. Gregory Yawman
    	
 
    	
 
    	
Name: H. Todd Dissinger
    
	
 
    	
Title: Secretary
    	
 
    	
 
    	
Title: Vice President —   TreasurerExhibit 10.1

 

FIRST AMENDMENT TO

CREDIT AGREEMENT

 

THIS FIRST AMENDMENT
TO CREDIT AGREEMENT (hereinafter called this “Amendment”) is dated as of June 26, 2015, by and among
RING ENERGY INC., a Nevada corporation (the “Borrower”), each lender party to the Credit Agreement referred
to below, SUNTRUST BANK, as Administrative Agent for such lenders (in such capacity, together with its successors in such capacity
“Administrative Agent”) and as Issuing Bank under the Credit Agreement referred to below, CADENCE BANK,
as Co-Documentation Agent, and Compass Bank, as Co-Documentation Agent.

 

W I T N E
S S E T H:

 

WHEREAS, the Borrower,
Administrative Agent and the lenders from time to time party thereto (the “Lenders”) are parties to that
certain Credit Agreement dated as of July 1, 2014 (as amended, restated, or otherwise modified from time to time, the “Existing
Credit Agreement” and, as amended by this Amendment and as further amended, modified or restated from time to time,
the “Credit Agreement”), whereby upon the terms and conditions therein stated the Lenders have agreed
to make certain loans to the Borrower upon the terms and conditions set forth therein;

 

WHEREAS, the Borrower
desires to increase the Aggregate Maximum Loan Amount to $500,000,000.00 (the “Commitment Increase”);

 

WHEREAS, each Lender
identified on the signature pages hereto desires to provide a portion of the Commitment Increase in the several amounts set forth
on Schedule II hereto;

 

WHEREAS, the Borrower
has requested that the Lenders amend the Credit Agreement as set forth below to facilitate the Commitment Increase and to make
certain other amendments to the Credit Agreement; and

 

WHEREAS, subject to
the terms and conditions hereof, the Lenders are willing to agree to the amendments to the Credit Agreement as set forth herein.

 

NOW, THEREFORE, for
and in consideration of the mutual covenants and agreements herein contained, the parties to this Amendment hereby agree as follows:

 

SECTION
1.Definitions.

 

(a)Unless
otherwise defined in this Amendment, each capitalized term used herein but not otherwise defined herein has the meaning given such
term in the Credit Agreement. The interpretive provisions set forth in Sections 1.2, 1.3 and 1.4 of the Credit
Agreement shall apply to this Amendment.

 

(b)As
used in this Amendment, the following terms shall have the meanings set forth below:

 

“Acquired
Assets” means the “Assets” as defined in the Finley Acquisition Agreement.

 

“Amendment
Effective Date” has the meaning given to such term in Section 5 of this Amendment.

 

“Amendment
Effective Date Transactions” means the delivery of the Loan Documents required to be delivered pursuant to the Amendment,
the consummation of the Finley Transactions by the Borrower and making of Loans on the Amendment Effective Date.

 

    	 

    	 

    

 

“Closing
Date Reserve Report” has the meaning set forth in Annex A  attached to this Amendment.

 

“Existing
Lender” means each Lender that is a party to this Amendment that has a Commitment under the Existing Credit Agreement.

 

“Finley Acquisition
Agreement” means that certain Purchase and Sale Agreement dated effective May 1, 2015, between Ring Energy, Inc.,
as buyer, and Finley Production Co., LP, BDT Oil & Gas, LP, Metcalfe Oil, LP, Grasslands Energy LP, Buffalo Oil & Gas,
LP, and Finley Resources Inc., as sellers.

 

“Finley Transactions”
means the acquisition by the Borrower of the Acquired Assets as defined in the Finley Acquisition Agreement.

 

“Increasing
Lender” means each Existing Lender whose dollar Commitment amount shown on Schedule II attached hereto
is higher than its Commitment under the Existing Credit Agreement, and the term “Increasing Lender” shall
also include each New Lender as herein defined.

 

“Arranger”
means SunTrust Robinson Humphrey, Inc., in its capacity as arranger in connection with the amended credit facility pursuant to
this Amendment.

 

“New Lender”
means each Lender that is a party to this Amendment that is not a party to the Existing Credit Agreement.

 

SECTION 2.Increase
and Joinder. Effective on the Amendment Effective Date:

 

(a)The Aggregate
Maximum Loan Amount is increased to $500,000,000.00.

 

(b)Each Increasing
Lender’s Commitment shall be as set forth on Schedule II attached hereto, and Schedule II of the Credit Agreement
is amended in its entirety to read as set forth in Schedule II attached hereto.

 

(c)Each New Lender
represents and agrees as follows: (i) it shall be a “Lender” under and as defined in the Credit Agreement and
shall have a Commitment in the amount set forth opposite its name on Schedule II attached hereto, (ii) it has received a
copy of the Existing Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent
financial statements delivered pursuant to Section 5.1 thereof, and such other documents and information as it deems appropriate
to make its own credit analysis and decision to enter into this Amendment, (iii) it has, independently and without reliance upon
the Administrative Agent, any other agent, any Lender or the Arranger, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this Amendment, and (iv) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

 

SECTION 3.Borrowing
Base Increase; Maximum Credit Amount Increase. Effective on the Amendment Effective Date, (a) the Borrowing Base is increased
to $100,000,000.00, and (b) the Aggregate Maximum Loan Amount is increased to $500,000,000.00.

 

SECTION
4.Additional Amendments to Credit Agreement. Effective on the Amendment Effective Date, the Credit Agreement is hereby
further amended as follows:

 

(a)Pricing.
Schedule I to the Credit Agreement (Applicable Margin and Applicable Percentage) is hereby replaced with Schedule
I attached hereto.

 

    	2

    	 

    

 

(b)New
Definitions. The following new definitions are hereby added to Section 1.01 of the Credit Agreement in proper alphabetical
order:

 

“Finley PSA”
means that certain Purchase and Sale Agreement dated effective May 1, 2015, between, Ring Energy, Inc., as buyer, and Finley Production
Co., LP, Finley Resources Inc., BDT Oil & Gas, LP, Metcalfe Oil, LP, Grasslands Energy LP and Buffalo Oil & Gas, LP, as
sellers.

 

“First Amendment
Closing Date” means June 26, 2015.

 

(c)Amended
and Restated Definitions (Change to Dates of Borrowing Base Redeterminations and Extension of Maturity). The following
definitions in Section 1.01 of the Credit Agreement are hereby amended and restated in their entirety to read as follows:

 

“Base Date”
means (a) prior to November 1, 2015, (i) the First Amendment Closing Date and (ii) the date of the determination scheduled to occur
on or about November 1, 2015 and (b) on or after November 1, 2015, the date of the most recent scheduled determination of the Borrowing
Base.

 

“Commitment
Termination Date” shall mean the earliest of (i) June 26, 2020, (ii) the date on which the Commitments are terminated
pursuant to Section 2.7 or Section 8.2 and (iii) the date on which the principal amount of all Loans outstanding
under this Agreement have been declared or have automatically become due and payable (whether by acceleration or otherwise).

 

(d)Amendments
to Definitions (Revision to Applicable Margin, Increased Maximum Loan Agreement and Increased Letter of Credit Commitment Amount).
The following definitions in Section 1.01 of the Credit Agreement are amended as follows:

 

“Applicable
Margin”: the definition of “Applicable Margin” is amended by deleting the word “Grid”
and replacing it with “grid”.

 

“Aggregate Maximum
Loan Amount”: the definition of “Aggregate Maximum Loan Amount” is amended by deleting the number
“$150,000,000.00” and replacing it with “$500,000,000.00”.

 

“LC Commitment”:
the definition of “LC Commitment” is amended by deleting the number “$2,500,000” and replacing it
with “$5,000,000”.

 

(e)Amendment
to Section 2.4(b) (Change to Dates of Scheduled and Interim Borrowing Base Redeterminations after the Amendment Effective Date).
Section 2.4(b) (Schedules and Interim Redeterminations) is amended in its entirety to read as follows:

 

“(b)Scheduled
and Interim Redeterminations. The Borrowing Base shall be redetermined semi-annually on each November 1 and May 1 beginning
November 1, 2015 (each, a “Scheduled Redetermination”). In addition, the Borrower may, by notifying the Administrative
Agent thereof, and the Administrative Agent may, at the direction of the Required Lenders, by notifying the Borrower thereof, each
elect to cause the Borrowing Base to be redetermined one time during each of the following periods: (A) between the First Amendment
Closing Date and the November 1, 2015 Scheduled Redetermination, and (B) starting with the November 1, 2015 Scheduled Redetermination,
during any six month period between Scheduled Redeterminations (each, an “Interim Redetermination”), in accordance
with this Section 2.4.”

 

    	3

    	 

    

 

(f)Amendment
to Section 2.4(d)(i) (Change to Dates of Scheduled and Interim Borrowing Base Redeterminations after the Amendment Effective Date).
Section 2.4(d)(i) (Effectiveness of a Redetermined Borrowing Base) is amended in its entirety to read as follows:

 

“(i)in the case of
a Scheduled Redetermination, (A) if the Administrative Agent shall have received the Engineering Reports required to be delivered
by the Borrower pursuant to clauses (a) and (c) of Section 5.13 in a timely and complete manner, then on the May 1 or November
1 (or, in each case, such date promptly thereafter as reasonably practicable), as applicable, following such notice, or (B) if
the Administrative Agent shall not have received the Engineering Reports required to be delivered by the Borrower pursuant to clauses
(a) and (c) of Section 5.13 in a timely and complete manner, then on the Business Day next succeeding delivery of such notice;
and”

 

(g)Amendment
to Section 3.2. Section 3.2 (Conditions to Each Credit Event) is amended by deleting “December
31, 2013” and inserting in lieu thereof “December 31, 2014”.

 

(h)Amendment
to Section 5.13(a) (Change to Delivery Dates of Reserve Reports). Section 5.13(a) (Reserve Reports)
is amended and restated in its entirety as follows:

 

“(a)On
or before April 1 and October 1 of each year, commencing October 1, 2015, the Borrower shall furnish to the Administrative Agent
and the Lenders a Reserve Report evaluating the Oil and Gas Properties of Borrower and its Subsidiaries as of the immediately preceding
January 1 (with respect to the Reserve Report due April 1) and July 1 (with respect to the Reserve Report due October 1). The Reserve
Report due April 1 of each year shall be prepared by one or more Approved Petroleum Engineers, and the Reserve Report due October
1 of each year shall be prepared by or under the supervision of the chief engineer of the Borrower who shall certify such Reserve
Report to be true and accurate and to have been prepared in accordance with the procedures used in the Reserve Report most recently
prepared by the Approved Petroleum Engineers.”

 

(i)Amendment
to Section 5.13(b) (Revision to Cross-Reference). Section 5.13(b) (Reserve Reports) is amended
by deleting the cross-reference to “Section 2.5(b)” and replacing it with “Section 2.4(b)”.

 

(j)Amendment
to Section 8.1 (Events of Default) (Revision to Cross-Reference). The paragraph at the end of Section 8.1
(Events of Default) is amended by deleting the parenthetical “(other than an event with respect to
the Borrower described in subsection (g) or (h) of this Section)” and replacing it with “(other than an event with
respect to the Borrower described in subsection (g), (h) or (i) of this Section)”.

 

SECTION
5.Conditions of Effectiveness. (a)
This Amendment shall become effective as of the date (the “Amendment Effective Date”) that each of the
conditions precedent set forth on Annex A hereto shall have been satisfied.

 

(a)Without
limiting the generality of the provisions of Sections 3.1 and 3.2 of the Credit Agreement, for purposes of determining
compliance with the conditions specified in Annex A, each Lender that has signed this Amendment (and its permitted
successors and assigns) shall be deemed to have consented to, approved or accepted, or to be satisfied with, each document or other
matter required hereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative
Agent shall have received written notice from such Lender prior to the proposed Amendment Effective Date specifying its objection
thereto.

 

    	4

    	 

    

 

(b)The
Administrative Agent shall notify the Borrower and the Lenders of the Amendment Effective Date.

 

SECTION
6.Post-Closing Requirements. The Borrower shall comply with the requirements set forth on Annex
B hereto within the time frames set forth therein as may be extended by the Administrative Agent.

 

SECTION
7.Representations and Warranties. The Borrower represents and warrants to Administrative Agent and
the Lenders, with full knowledge that such Persons are relying on the following representations and warranties in executing this
Amendment, as follows:

 

(a)It
has the organizational power and authority to execute, deliver and perform this Amendment, and all organizational action on the
part of it requisite for the due execution, delivery and performance of this Amendment has been duly and effectively taken.

 

(b)The
Credit Agreement, as amended by this Amendment, the Loan Documents and each and every other document executed and delivered to
the Administrative Agent and the Lenders in connection with this Amendment to which it is a party constitute the legal, valid and
binding obligations of the Borrower, enforceable against the Borrower in accordance with their respective terms except as enforceability
may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally
or by equitable principles relating to enforceability.

 

(c)This
Amendment does not and will not violate any provisions of any of the articles or certificate of incorporation, bylaws, and other
organizational and governing documents of the Borrower.

 

(d)No
approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority is necessary
or required in connection with the execution, delivery or performance by, or enforcement against, the Borrower of this Amendment.

 

(e)Before
and after giving effect to this Amendment and the Amendment Effective Date Transactions, the representations and warranties of
the Borrower contained in Article IV of the Credit Agreement or in any other Loan Document are true and correct in all material
respects (other than those representations and warranties that are expressly qualified by a Material Adverse Effect or other materiality,
in which case such representations and warranties shall be true and correct in all respects).

 

(f)Before
and after giving effect to this Amendment and the Amendment Effective Date Transactions, no Default, Event of Default or Borrowing
Base Deficiency exists.

 

(g)Since
December 31, 2014, there has been no event or circumstance which has had or could reasonably be expected to have a Material Adverse
Effect or a material adverse effect on the Acquired Assets.

 

(h)As
of the Amendment Effective Date, notwithstanding any provision in any Collateral Document to the contrary, no Building (as defined
in the applicable Flood Insurance Regulation) or Manufactured (Mobile) Home (as defined in the applicable Flood Insurance Regulation)
included in the definition of “Mortgaged Property” or “collateral” or similar definition in any Collateral
Document and no Building or Manufactured (Mobile) Home is encumbered by any Collateral Document. As used in this paragraph, “Building”
means any Building or Manufactured (Mobile) Home, in each case as defined in the applicable Flood Insurance Regulations); and “Flood
Insurance Regulations” means (I) the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor
statute thereto, (II) the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statute thereto,
(III) the National Flood Insurance Reform Act of 1994 (amending 42 USC § 4001, et seq.), as the same may be amended or recodified
from time to time, and (IV) the Flood Insurance Reform Act of 2004 and any regulations promulgated thereunder.

 

    	5

    	 

    

 

SECTION
8.Miscellaneous.

 

(a)Reference
to the Credit Agreement. Upon the effectiveness hereof, on and after the date hereof, each reference in the Credit Agreement
to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of like import,
shall mean and be a reference to the Credit Agreement as amended hereby.

 

(b)Effect
on the Credit Agreement; Ratification. Except as specifically amended by this Amendment, the Credit Agreement shall remain
in full force and effect and is hereby ratified and confirmed. By its acceptance hereof, the Borrower hereby ratifies and confirms
each Loan Document to which it is a party in all respects, after giving effect to the Borrowing Base redetermination and amendments
set forth herein.

 

(c)Extent
of Amendments. Except as otherwise expressly provided herein, the Credit Agreement and the other Loan Documents are not
amended, modified or affected by this Amendment. The Borrower hereby ratifies and confirms that (i) except as expressly amended
hereby, all of the terms, conditions, covenants, representations, warranties and all other provisions of the Credit Agreement remain
in full force and effect, (ii) each of the other Loan Documents are and remain in full force and effect in accordance with their
respective terms, and (iii) the Collateral and the Liens on the Collateral securing the Obligations are unimpaired by this Amendment
and remain in full force and effect.

 

(d)Loan
Documents. The Loan Documents, as such may be amended in accordance herewith, are and remain legal, valid and binding obligations
of the parties thereto, enforceable in accordance with their respective terms. This Amendment is a Loan Document.

 

(e)Claims.
As additional consideration to the execution, delivery, and performance of this Amendment by the parties hereto and to induce Administrative
Agent and Lenders to enter into this Amendment, the Borrower represents and warrants that, as of the date hereof, it does not know
of any defenses, counterclaims or rights of setoff to the payment of any Obligations of the Borrower to Administrative Agent, Issuing
Bank or any Lender.

 

(f)Execution
and 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 to be an original and all of which taken together shall
constitute but one and the same instrument. Delivery of an executed counterpart of this Amendment by facsimile or pdf shall be
equally as effective as delivery of a manually executed counterpart.

 

(g)Governing
Law. This Amendment and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise)
based upon, arising out of or relating to this Amendment and the transactions contemplated hereby and thereby shall be construed
in accordance with and be governed by the law (without giving effect to the conflict of law principles thereof) of the State of
Texas.

 

(h)Headings.
Section headings in this Amendment are included herein for convenience and reference only and shall not constitute a part of this
Amendment for any other purpose.

 

SECTION
9.NO ORAL AGREEMENTS. THE RIGHTS AND OBLIGATIONS OF EACH OF THE PARTIES TO THE LOAN DOCUMENTS SHALL BE
DETERMINED SOLELY FROM WRITTEN AGREEMENTS, DOCUMENTS, AND INSTRUMENTS, AND ANY PRIOR ORAL AGREEMENTS BETWEEN SUCH PARTIES ARE SUPERSEDED
BY AND MERGED INTO SUCH WRITINGS. THIS AMENDMENT AND THE OTHER WRITTEN LOAN DOCUMENTS EXECUTED BY THE BORROWER, ADMINISTRATIVE
AGENT, ISSUING BANK AND/OR LENDERS REPRESENT THE FINAL AGREEMENT BETWEEN SUCH PARTIES, AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BY SUCH PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN SUCH PARTIES.

 

    	6

    	 

    

 

SECTION
10.No Waiver. The Borrower hereby agrees that no Event of Default and no Default has been waived or
remedied by the execution of this Amendment by the Administrative Agent or any Lender. Nothing contained in this Amendment nor
any past indulgence by the Administrative Agent, Issuing Bank or any Lender, nor any other action or inaction on behalf of the
Administrative Agent, Issuing Bank or any Lender, (i) shall constitute or be deemed to constitute a waiver of any Defaults or Events
of Default which may exist under the Credit Agreement or the other Loan Documents, or (ii) shall constitute or be deemed to constitute
an election of remedies by the Administrative Agent, Issuing Bank or any Lender, or a waiver of any of the rights or remedies of
the Administrative Agent, Issuing Bank or any Lender provided in the Credit Agreement, the other Loan Documents, or otherwise afforded
at law or in equity.

 

 

 

Signatures Pages Follow

 

 

    	7

    	 

    

 

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

 

	 	RING ENERGY INC.,
	 	as Borrower
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 

 

Signature Page to First Amendment to Credit
Agreement

Ring Energy, Inc.

 

 

    	 

    	 

    

 

	 	SUNTRUST BANK,
	 	as Administrative Agent, as Issuing Bank and as a Lender
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 

 

Signature Page to First Amendment to Credit
Agreement

Ring Energy, Inc.

 

    	 

    	 

    

 

 

	 	[NEW LENDER],
	 	as a Lender
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 

 

Signature Page to First Amendment to Credit
Agreement

Ring Energy, Inc.

 

    	 

    	 

    

 

 

SCHEDULE I

 

 

 

Applicable Margin and Applicable Percentage

 

 

	Pricing Level	Borrowing Base 

Utilization 

Percentage	Applicable Margin for Eurodollar Loans	Applicable Margin for Base Rate Loans	Applicable Percentage for Unused Commitment Fee
	I	< 25%	1.75% 

per annum	2.75% 

per annum	0.300% 

per annum
	II	≥ 25% but < 50%	2.00% 

per annum	3.00% 

per annum	0.375%  

per annum
	III	≥ 50% but < 75%	2.25% 

per annum	3.25% 

per annum	0.375% 

per annum
	IV	≥ 75% but < 90%	2.50% 

per annum	3.50% 

per annum	0.375% 

per annum
	V	≥ 90%	2.75% 

per annum	3.75% 

per annum	0.500% 

per annum

 

 

 

Schedule I

 

    	 

    	 

    

 

 

 

SCHEDULE II

 

 

 

Maximum Loan Amounts

 

 

 

	Lender	Pro Rata Share	Pro Rata Share of 

Borrowing Base	Maximum Loan 

Amount
	SunTrust Bank	30.0%	$30,000,000	$150,000,000
	Cadence Bank	17.5%	$17,500,000	$87,500,000
	Compass Bank	17.5%	$17,500,000	$87,500,000
	IBERIABANK	15.0%	$15,000,000	$75,000,000
	NBH Bank	12.5%	$12,500,000	$62,500,000
	CrossFirst Bank	7.5%	$7,500,000	$37,500,000
	TOTAL	100%	$100,000,000	$500,000,000

 

 

 

Schedule II

 

    	 

    	 

    

 

ANNEX A

CONDITIONS PRECEDENT

 

1.The Administrative
Agent shall have received (which may be by electronic transmission), in form and substance satisfactory to the Administrative Agent,
the following, in each case dated as of the Amendment Effective Date unless otherwise indicated below:

 

(a)a counterpart
of this Amendment which shall have been executed by the Administrative Agent, the Issuing Bank, each of the Lenders shown on Schedule
II to this Amendment and the Borrower (which may be by PDF transmission);

 

(b)a certificate
of the Borrower’s principal executive officer or principal financial officer satisfying the requirements of Section 5.13
of the Credit Agreement as to the Reserve Report (or Reports, if more than one) (the “Closing Date Reserve Report”,
whether one or more) delivered with respect to the Borrower’s Oil and Gas Properties (including the Acquired Assets) evaluated
in connection with the increase of the Borrowing Base pursuant to this Amendment;

 

(c)(i) Mortgages
covering the Acquired Assets and (ii) such other Collateral Documents, title information, supplements, amendments, documents and
instruments that the Administrative Agent shall have requested so that after giving effect to the Finley Transactions (y) subject
to Annex B hereto, the Administrative Agent has received satisfactory title information on at least 80% of
the total value of the Oil and Gas Properties of the Borrower (including the Acquired Assets) covered by the Closing Date Reserve
Report and (z) the Borrower has granted to the Administrative Agent as security for the Obligations a perfected first-priority
Lien interest in its Oil and Gas Properties (including the Acquired Assets) as required by Section 5.15 of the Credit Agreement;
(it being understood that any filing or recordation may occur after the Amendment Effective Date so long as the Administrative
Agent has the authority to make such filings and recordations on the Amendment Effective Date);

 

(d)lien searches,
environmental reports, and such other diligence as the Arranger may reasonably require with respect to the Acquired Assets, including
the Phase I report conducted by Environmental Consultants, Inc.;

 

(e)favorable written
opinion of Burleson LLP, special Nevada and Texas counsel to the Loan Parties, addressed to the Administrative Agent, the Issuing
Bank and each of the Lenders, in form and substance satisfactory to, and covering such matters relating to the Loan Parties, the
Loan Documents and the transactions contemplated therein as may be requested by, the Administrative Agent and the Arranger;

 

(f)a certificate
executed by the principal financial officer of the Borrower certifying as to: (i) solvency of the Borrower and its subsidiaries
on a consolidated basis after giving effect to the this Amendment and the Amendment Effective Date Transactions, (ii) the Borrower’s
pro forma compliance with Article VI (Financial Covenants) of the Credit Agreement after giving effect to the this
Amendment and the Amendment Effective Date Transactions, and (iii) the matters set forth in Sections 2 through 8
of this Annex A;

 

(g)a certificate
of the Secretary or Assistant Secretary of each Loan Party, attaching and certifying copies of its certificate or articles of incorporation
and bylaws, and of the resolutions of its board of directors, authorizing the execution, delivery and performance of the Loan Documents
to which it is a party and the Finley Acquisition Agreement and all related documentation thereto and certifying the name, title
and true signature of each officer of such Loan Party executing such Loan Documents and the Finley Acquisition Agreement and all
related documentation thereto to which it is a party;

 

    	Annex A - Page 1

    	 

    

 

 

(h)certified copies
of the articles or certificate of incorporation, of each Loan Party, together with certificates of good standing or existence,
as may be available from the Secretary of State of the jurisdiction of organization of such Loan Party and each other jurisdiction
where such Loan Party is required to be qualified to do business as a foreign corporation, each dated as of a recent date.

 

(i)the Borrower’s
unaudited financial statements together with officer’s certificate, in each case as required pursuant to Sections 5.1(b)
and 5.1(c) of the Credit Agreement;

 

(j) a pro forma
balance sheet, income statement, statement of cash flows and projections of the Borrower and its subsidiaries as of the last day
of March 31, 2015, giving pro forma effect to the Finley Transactions and the loans made on the Amendment Closing Date as if the
Finley Transactions had occurred and such loans had been made as of such date (in the case of such balance sheet) or at the beginning
of such period (in the case of such other financial statements) (the “Pro Forma Statements and Projections”),
together with such information as the Administrative Agent may reasonably request to confirm the tax, legal and business assumptions
made in such Pro Forma Statements and Projections and pro forma compliance with Article IV (Financial Covenants) of the
Credit Agreement after giving effect to the this Amendment and the Amendment Effective Date Transactions; and

 

(k)to the extent
not previously delivered to Administrative Agent, certificates of insurance as described in Section 3.1(b)(xvi) of the Credit
Agreement, evidencing insurance coverage as required by the Loan Documents.

 

2.The Administrative
Agent shall have received fully executed copies of the Finley Acquisition Agreement and all other material documents and agreements
evidencing the Finley Transactions, together with all exhibits and schedules, certified by a Responsible Officer of the Borrower
as being true and correct and complete.

 

3.Each of the representations
and warranties set forth in Section 7 of this Amendment shall be true and correct.

 

4.The Finley Transactions
shall have been consummated (or shall be consummated on the Amendment Effective Date substantially simultaneously with the funding
of the requested Loans on the Amendment Effective Date) (x) in accordance with applicable Requirements of Law and (y) in accordance
with the terms and conditions of the Finley Acquisition Agreement as in effect on the date of this Amendment without giving effect
to any waiver, modifications or consent thereunder that is materially adverse to the interests of the Lenders (as reasonably determined
by the Arranger) unless approved by the Arranger.

 

5.All approvals
of a Governmental Authority or third party necessary in connection with the Finley Transactions, the financing and transactions
contemplated hereby and the continued operations of Borrower’s business shall have been obtained and shall be in full force
and effect, and all applicable waiting periods shall have expired without any action being taken or threatened by any competent
authority that would restrain, prevent or otherwise impose adverse conditions on the Finley Transactions or the financing thereof,
or any transactions contemplated hereby.

 

6.There is no action,
suit, investigation or proceeding pending or threatened in any court or before any arbitrator or Governmental Authority that purports
to affect the Finley Transactions or the financing thereof, any transaction contemplated hereby, or that could have a Material
Adverse Effect or a material adverse effect on the Finley Transactions or the financing thereof, the Acquired Assets or any transaction
contemplated hereby or on the ability of any Loan Party to perform its obligations under the Loan Documents.

 

    	Annex A - Page 2

    	 

    

 

7.Since December
31, 2014, there has been no event or condition that has had or could reasonably be expected to have a Material Adverse Effect or
a material adverse effect on the Acquired Assets.

 

8.The purchase
price reduction under the Finley Acquisition Agreement as a result of title defects, environmental defects, preferential rights
and casualty losses shall not exceed five percent (5%) of the Purchase Price (as defined in the Finley Acquisition Agreement) unless
approved by the Arranger.

 

9.The capitalization,
structure and equity ownership of Borrower after giving effect to the Finley Transactions and the transactions contemplated by
this Amendment shall be satisfactory to Arranger in all material respects.

 

10.The Borrower
shall have delivered such documentation and information required by regulatory authorities under applicable “know your customer”
and anti-money laundering laws as requested by the Administrative Agent or any Lender.

 

11.Borrower shall
have paid, or shall have made arrangements with the Administrative Agent to pay with the proceeds of the Borrowing made on the
Amendment Effective Date, all fees and expenses due to the Lenders and the Administrative Agent (including, but not limited to,
reasonable attorneys’ fees of counsel to the Administrative Agent).

 

    	Annex A - Page 3

    	 

    

 

 

ANNEX B

POST-CLOSING OBLIGATIONS

 

The Borrower shall
deliver title information in form and substance acceptable to the Administrative Agent covering the Oil and Gas Properties evaluated
by the Closing Date Reserve Report (which in any event shall cover, together with title information previously delivered to the
Administrative Agent, at least eighty percent (80%) of the total value of the Oil and Gas Properties evaluated by the Closing Date
Reserve Report), as follows:

 

(a)on
the Amendment Effective Date, on at least 50% of the total value of the Oil and Gas Properties evaluated by the Closing Date Reserve
Report;

 

(b)within
30 days after the Amendment Effective Date, on at least 60% of the total value of the Oil and Gas Properties evaluated by the Closing
Date Reserve Report;

 

(c)within
60 days after the Amendment Effective Date, on at least 70% of the total value of the Oil and Gas Properties evaluated by the Closing
Date Reserve Report; and

 

(d)within
90 days after the Amendment Effective Date, on at least 80% of the total value of the Oil and Gas Properties evaluated by the Closing
Date Reserve Report.

 

 

    	 	Annex B

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