Document:

exh10_1.htm

    
      
 

      
         

        SEVENTH
          AMENDMENT TO CREDIT AGREEMENT

         

        This
          Seventh Amendment to Credit Agreement (the “Amendment”) is made as of
          August 20, 2009, by and between TORTOISE CAPITAL RESOURCES CORPORATION,
          a
          Maryland corporation (the “Borrower”); and U.S. BANK NATIONAL
          ASSOCIATION, a national banking association (the “Bank”); and as the
          lender for Swingline Loans (in such capacity, the “Swingline Lender”), as
          agent for the Banks hereunder (in such capacity, the “Agent”), and as
          lead arranger hereunder (in such capacity, the “Lead
          Arranger”).  Capitalized terms used and not defined in this
          Amendment have the meanings given to them in the Credit Agreement referred
          to
          below.

         

        Preliminary
          Statements

         

        (a)           The
          Bank and the Borrower are parties to a Credit Agreement dated as of April
          25,
          2007, as amended by the First Amendment to Credit Agreement dated as of
          July 18,
          2007, as further amended by the Second Amendment to Credit Agreement dated
          as of
          September 28, 2007, as further amended by the Third Amendment to Credit
          Agreement dated as of March 21, 2008, as further amended by the Fourth
          Amendment
          to Credit Agreement dated as of March 28, 2008, as further amended by the
          Fifth
          Amendment to Credit Agreement dated as of March 20, 2009, and as further
          amended
          by the Sixth Amendment to Credit Agreement dated as of June 20, 2009 (as
          so
          amended, and as the same may be further amended, renewed, restated, replaced,
          consolidated or otherwise modified from time to time, the “Credit
          Agreement”).

         

        (b)           The
          Borrower has requested to renew and extend the term of the Credit Agreement
          until February 20, 2010.

         

        (c)           The
          Bank is willing to agree to the foregoing request, subject, however, to
          the
          terms, conditions, and agreements set for the below.

         

        NOW,
          THEREFORE, for good and valuable consideration, the receipt and sufficiency
          of
          which are hereby acknowledged, the Bank and the Borrower agree as
          follows:

         

        1.  Modification
          to Section 1.1 Definitions.  The following definitions as set
          forth in Section 1.1 of the Credit Agreement are hereby deleted in their
          entirety and are hereby replaced with the following:

         

        “Borrowing
          Base” means, at any date, 20% of the amount, after giving effect to any
          requested Loan on such date (if applicable), of (i) the total value of
          the
          Borrower’s assets, minus (ii) all liabilities and indebtedness not
          represented by “senior securities” (as such term is used in the 1940 Act),
minus (iii) all other securities and investments not included in the
          Securities Account.

         

        “Termination
          Date” means February 20, 2010; provided, however, if such day is
          not a Business Day, the Termination Date shall be the immediately preceding
          Business Day.

         

        2.  Decrease
          in Revolving Credit Facility.  The reference to “$11,700,000”
in Section 2.1 of the Credit Agreement is hereby deleted and is
          hereby replaced
          with “$5,000,000.”

         

        3.  Modification
          to Swingline Loans.  The parties agree that from and after
          the date of this Amendment, the Swingline Loan Commitment shall be $0.00,
          and
          the Swingline Loans, and the obligations to make Swingline Loans, shall
          be
          terminated.  For avoidance of doubt, no Bank, including the Swingline
          Lender, shall have any obligation to provide Swingline Loans to the
          Borrower.  The parties further agree that the provisions and terms of
          the Credit Agreement, and in any other Credit Document, relating to Swingline
          Loans are hereby deemed to be inapplicable and of no force and effect,
          without
          further action by any party.  Only upon express written agreement by
          all parties to the Credit Agreement, and any other Credit Document relating
          to
          Swingline Loans, shall Swingline Loans, and the provisions relating thereto,
          be
          deemed to be reinstated and effective.

         

        4.  Modification
          to Section 3.4(a).  Section 3.4(a) of the Credit Agreement is
          hereby deleted in its entirety and is hereby replaced with the
          following:

         

        (a)           Borrowing
          Base.  The sum of the outstanding balance of the Loans shall not,
          at any time, exceed the Borrowing Base.  If at any time the sum of the
          outstanding balance of Loans exceeds the amount permitted hereby, the Borrower
          shall immediately prepay the Loans in an amount equal to the amount of
          such
          excess.

         

        5.  Modification
          to Section 3.4(c).  Section 3.4(c) of the Credit Agreement is
          hereby deleted in its entirety and is hereby replaced with the
          following:

         

        (c)           Sale
          of Collateral.  In the event that the Borrower shall sell or
          liquidate, or cause to be sold or liquidated, any Collateral, the Borrower
          shall
          pay 100% of the proceeds from any such sale or liquidation as a mandatory
          prepayment of the Loans.

         

        6.  Modification
          to Section 3.6.  Section 3.6 of the Credit Agreement is
          hereby deleted in its entirety and replaced with the following:

         

                3.6           Use
          of Proceeds.  The Revolving Credit Loans shall be used solely for
          purposes of: (1) the refinancing of the existing senior indebtedness of
          the
          Borrower to U.S. Bank National Association; (2) the Borrower’s acquisition of
          investment property in the ordinary course of its business; and (3) paying
          costs
          and expenses incurred in connection with the closing of the transactions
          contemplated by this Agreement.

         

        7.  Modification
          to Exhibit A.  Exhibit A as attached to the Credit Agreement
          is deleted and is hereby replaced with Exhibit A, attached to this
          Amendment.

         

        8.  New
          Note.  Contemporaneously with the execution and delivery of
          this Amendment, the Borrower, as maker, shall execute and deliver a new
          revolving credit note, in the stated principal amount of $5,000,000, in
          favor of
          U.S. Bank National Association, as payee (the “New Note”), which New Note
          shall amend, restate and replace the Note dated as of June 20, 2009, from
          the
          Borrower, as maker, to U.S. Bank National Association, as payee, in the
          stated
          principal amount of $11,700,000 (the “Old Note”), and which New Note, as
          the same may be amended, renewed, restated, replaced or consolidated from
          time
          to time, shall be a “Revolving Credit Note” referred to in the Credit
          Agreement.

         

        9.  Reaffirmation
          of Credit Documents.  The Borrower reaffirms its obligations
          under the Credit Agreement, as amended hereby, and the other Credit Documents
          to
          which it is a party or by which it is bound, and represents, warrants and
          covenants to the Bank, as a material inducement to the Bank to enter into
          this
          Amendment, that (a) the Borrower has no and in any event waives any, defense,
          claim or right of setoff with respect to its obligations under, or in any
          other
          way relating to, the Credit Agreement, as amended hereby, or any of the
          other
          Credit Documents to which it is a party, or the Bank’s actions or inactions in
          respect of any of the foregoing, and (b) all representations and warranties
          made
          by or on behalf of the Borrower in the Credit Agreement and the other Credit
          Documents are true and complete on the date hereof as if made on the date
          hereof.

         

        10.  Conditions
          Precedent to Amendment.  Except to the extent waived in a
          writing signed by the Bank and delivered to the Borrower, the Bank shall
          have no
          duties under this Amendment until the Bank shall have received fully executed
          originals of each of the following, each in form and substance satisfactory
          to
          the Bank:

         

        (a)  Amendment.  This
          Amendment;

         

        (b)  New
          Note.  The New Note;

         

                (c)  Form
          U-1.  A Form U-1 for the Borrower whereby, among other
          things, (i) the maximum principal amount of Revolving Credit Loans that
          may be
          outstanding from time to time under the Credit Agreement is noted as being
          $5,000,000, and (ii) the Borrower concurs (and the Borrower does hereby
          concur)
          with the assessment of the market value of the margin stock or other investment
          property described in the attachment to such Form U-1 as of the date provided
          in
          such attachment;

         

             (d)  Secretary’s
          Certificate.  A certificate from the Secretary or
          Assistant Secretary of the Borrower certifying to the Bank that, among
          other
          things, (i) attached thereto as an exhibit is a true and correct copy of
          the
          resolutions of the board of directors of the Borrower authorizing the Borrower
          to enter into the transactions described in this Amendment and the execution,
          delivery and performance by the Borrower of such Credit Documents, (ii)
          the
          articles of incorporation and by-laws of the Borrower as delivered to the
          Agent
          pursuant to the Secretary’s Certificate dated April 25, 2007 from the
          Borrower’s secretary remain in full force and effect and have not been amended
          or otherwise modified or revoked, and (iii) attached thereto as exhibits
          are
          certificates of good standing, each of recent date, from the Secretary
          of State
          of Maryland and the Secretary of State of Kansas, certifying the good standing
          and authority of the Borrower in such states as of such dates; and

         

        (e)  Other
          Documents.  Such other documents as the Bank may
          reasonably request to further implement the provisions of this Amendment
          or the
          transactions contemplated hereby.

         

        11.  No
          Other Amendments; No Waiver of Default.  Except as amended
          hereby, the Credit Agreement and the other Credit Documents shall remain
          in full
          force and effect and be binding on the parties in accordance with their
          respective terms.  By entering into this Amendment, the Bank is not
          waiving any Default or Event of Default which may exist on the date
          hereof.

         

        12.  Expenses.  The
          Borrower agrees to pay and reimburse the Bank for all out-of-pocket costs
          and
          expenses incurred in connection with the negotiation, preparation, execution,
          delivery, operation, enforcement and administration of this Amendment,
          including
          the reasonable fees and expenses of counsel to the Bank.

         

        13.  Affirmation
          of Security Interest.  The Borrower hereby confirms and
          agrees that any and all liens, security interests and other security or
          Collateral now or hereafter held by the Bank as security for payment and
          performance of the Notes and the Obligations are renewed hereby and carried
          forth to secure payment and performance of the Notes and the
          Obligations.  The Credit Documents are and remain legal, valid and
          binding obligations of the parties thereto, enforceable in accordance with
          their
          respective terms.

         

        14.  Counterparts;
          Fax Signatures.  This Amendment and any documents
          contemplated hereby may be executed in one or more counterparts and by
          different
          parties thereto, all of which counterparts, when taken together, shall
          constitute but one agreement.  This Amendment and any documents
          contemplated hereby may be executed and delivered by facsimile or other
          electronic transmission and any such execution or delivery shall be fully
          effective as if executed and delivered in person.

         

        15.  Governing
          Law.  This Amendment shall be governed by the same law that
          governs the Credit Agreement.

         

        [Remainder
          of Page Intentionally Left Blank]

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        K.S.A.
          §16-118 Required Notice.  This statement is provided pursuant to
          K.S.A. §16-118:  “THIS AMENDMENT TO CREDIT AGREEMENT IS A FINAL
          EXPRESSION OF THE AMENDMENT TO CREDIT AGREEMENT BETWEEN THE BANK (AS CREDITOR)
          AND THE BORROWER (AS DEBTOR) AND SUCH WRITTEN AMENDMENT TO CREDIT AGREEMENT
          MAY
          NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR ORAL AMENDMENT TO CREDIT AGREEMENT
          OR OF A CONTEMPORANEOUS ORAL AMENDMENT TO CREDIT AGREEMENT BETWEEN THE
          BANK AND
          THE BORROWER.”  THE FOLLOWING SPACE CONTAINS ANY NON-STANDARD TERMS,
          INCLUDING THE REDUCTION TO WRITING OF ANY PREVIOUS ORAL AMENDMENT TO CREDIT
          AGREEMENT:

         

        

         

        NONE.

         

        The
          creditor and debtor, by their respective initials or signatures below,
          confirm
          that no unwritten amendment to credit agreement exists between the
          parties:

         

        Creditor:   SMU                                           

         

        Debtor:         TM                                           

         

        [signature
          page to follow]

        

         

        
          
                  

                                                         Seventh
                Amendment to Credit Agreement – Initial
                Page      
      

                      
      
    

            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        IN
          WITNESS WHEREOF, the parties have entered into this Amendment as of the
          date
          first above written.

         

        

        
          	
                   

                	
                                          TORTOISE
                    CAPITAL RESOURCES CORPORATION,

                

        

        
          	
                   

                	
                                          the
                    Borrower

                

        

        

        

                                By:  /s/
          Terry
          Matlack                                                                           

                                       Name:
          Terry C.
          Matlack

                                       Title:
          Chief
          Financial Officer

        

        

                                U.S.
          BANK NATIONAL
          ASSOCIATION,

                                as
          Agent and as the
          Bank

        

        

                                By:  /s/
          Shelly
          Ungles                                                                           

                                      Name:
          Shelly
          Ungles

                                      Title:
          Vice
          President

        
          
                  

                                                  Seventh
                Amendment to Credit Agreement
– Signature
                Page      
      

                      
      
    

            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        EXHIBIT
          A

         

        (Banks
          and Commitments)

         

        

         

        
          	
                   

                  Bank

                	
                  Revolving
                    Credit Loan Commitment Amount

                	
                  Swingline
                    Loan Commitment Amount*

                	
                  Bank’s
                    Total Commitment Amount

                	
                  Bank’s
                    Pro-Rata Percentage**

                
	
                  U.S.
                    Bank

                  National
                    Association

                	
                  $5,000,000

                	
                  $0

                	
                  $5,000,000

                	
                  1.000000000000

                
	 	 	 	 	 
	
                          TOTALS:

                	
                  $5,000,000

                	
                  $0

                	
                  $5,000,000

                	
                  1.000000000000

                

        

        

        
          	
                   

                	
                  *

                	
                  As
                    more particularly described in the Agreement, the Swingline Loan
                    Commitment is a subcommitment under the Revolving Credit Loan
                    Commitments.  Accordingly, extensions of credit under the
                    Swingline Loan Commitment act to reduce, on a dollar-for-dollar
                    basis, the
                    amount of credit otherwise available under the Revolving Credit
                    Loan
                    Commitments.

                

        

         

        

        Seventh
          Amendment to Credit Agreement - Exhibit
          Aexhibit10_1.htm

 

 

 

For Immediate Release

U.S. ENERGY CORP. ANNOUNCES INITIAL PRODUCTION RESULTS FROM THEIR STODDARD #1 WELL IN TEXAS

RIVERTON, Wyoming – August 24, 2009 – U.S. Energy Corp. (NASDAQ Capital Market: “USEG”) (“USE” or the “Company”), a natural resources exploration and development company with interests in molybdenum, oil and gas, and real estate assets, today announced that its partner, Houston Energy, L.P.
(“HE”) has advised the company that an initial production test from the Stoddard #1 well (first well drilled with HE) in Southeast Texas resulted in approximately 3.9 MMCF and 240 barrels of oil per day or an equivalent of 5.34 MMCFE/D.  Upon reaching contract depth on the Stoddard #1 well in June; HE encountered two productive zones with approximately 35 feet of net pay in the Tex-Miss and F3 Frio sands.  Sales expected to commence within the next 60 days.  Optimal production
flow rates to sales will be determined once hooked up to sales lines.  U.S. Energy Corp. has an 8.5% after casing point (ACP) working interest (6.2% net revenue interest).  There is also a 10% after prospect payout (APO) back-in working interest due the operator, which would reduce USE's working interest to 7.65% (5.6% net revenue interest) APO.

“We are very pleased with the initial production rates of the Stoddard well,” stated Keith Larsen, CEO of U.S. Energy Corp.  “With the company’s strong balance sheet we continue to seek out additional oil and gas opportunies, while working towards our stated goals of further establishing recurring revenues
and cash flow in order to enhance shareholder value,” he added.

* * * * *

 

 

 

 

 

Press Release

August 24, 2009

Page 2 of 2

 

 

 

Note Regarding Mcfe

In this press release, Mcfes are derived by converting oil to gas in the ratio of one barrel of oil to six thousand cubic feet of gas (1 bbl:6 Mcf).  One thousand cubic feet of gas equivalent (“Mcfe”) amounts may be misleading, particularly if used in isolation.  A Mcfe conversion ratio of 1 bbl of oil to
6 Mcf of natural gas is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value of equivalency at the well head.

About U.S. Energy Corp.

U.S. Energy Corp. is a diversified natural resource company with interests in molybdenum, oil and gas, geothermal and real estate assets.  The Company is headquartered in Riverton, Wyoming, and its common stock is listed on The NASDAQ Capital Market under the symbol “USEG”.

* * * * *

Disclosure Regarding Mineral Resources Under SEC and Canadian Regulations; and Forward-Looking Statements

The Company owns or may come to own stock in companies which are traded on foreign exchanges, and may have agreements with some of these companies to acquire and/or develop the Company’s mineral properties.  An example is Sutter Gold Mining Inc.  These other companies are subject to the reporting
requirements of other jurisdictions.

United States residents are cautioned that some of the information available about our mineral properties, which is reported by the other companies in foreign jurisdictions, may be materially different from what the Company is permitted to disclose in the United States.

This news release includes statements which may constitute “forward-looking” statements, usually containing the words “believe,” “estimate,” “project,” “expect," or similar expressions.  These statements are made pursuant to the safe harbor provision of
the Private Securities Litigation Reform Act of 1995.  Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements.  Factors that would cause or contribute to such differences include, but are not limited to, future trends in mineral prices, the availability of capital, competitive factors, and other risks.  By making these forward-looking statements, the Company undertakes no obligation
to update these statements for revision or changes after the date of this release.

For further information on the differences between the reporting limitations of the United States, compared to reports filed in foreign jurisdictions, and also concerning forward-looking statements, please see the Company’s Form 10-K (“Disclosure Regarding Forward-Looking Statements”; “Disclosure
Regarding Mineral Resources under SEC and Canadian Regulation”; and “Risk Factors”); and similar disclosures in the Company’s Forms 10-Q.

* * * * *

For further information, please contact:

Reggie Larsen

Director of Investor Relations

U.S. Energy Corp.

(800) 776-9271

Reggie@usnrg.com

Nick Hurst

The Equicom Group

Investor Relations

(403) 538-4845

nhurst@equicomgroup.com

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