Document:

KWK 10K EX 10.31

Exhibit 10.31
Execution Version

OMNIBUS AMENDMENT NO. 3 
TO COMBINED CREDIT AGREEMENTS
THIS OMNIBUS AMENDMENT NO. 3 TO COMBINED CREDIT AGREEMENTS (this “Amendment”), dated as of October 5, 2012, is among QUICKSILVER RESOURCES INC., (the “U.S. Borrower”), QUICKSILVER RESOURCES CANADA, INC., (the “Canadian Borrower”) (collectively, the “Combined Borrowers”), JPMORGAN CHASE BANK, N.A., as global administrative agent (in such capacity, the “Global Administrative Agent”), JPMORGAN CHASE BANK, N.A., TORONTO BRANCH, as Canadian administrative agent (in such capacity, the “Canadian Administrative Agent”), and each of the U.S. Lenders and Canadian Lenders party hereto.

R E C I T A L S
A.    The U.S. Borrower, the Global Administrative Agent, and the various financial institutions party thereto as Agents or Lenders (the “U.S. Lenders”) entered into that certain Amended and Restated Credit Agreement dated as of December 22, 2011 (as amended by Omnibus Amendment No. 1 dated as of May 23, 2012, as further amended by Omnibus Amendment No. 2 dated as of August 6, 2012, and as amended, supplemented or modified, the “U.S. Credit Agreement”).
B.    Quicksilver Resources Inc., as parent, the Canadian Borrower, the Canadian Administrative Agent, the Global Administrative Agent, and the various financial institutions party thereto as agents or lenders (the “Canadian Lenders”) entered into that certain Amended and Restated Credit Agreement dated as of December 22, 2011 (as amended by Omnibus Amendment No. 1 dated as of May 23, 2012, as further amended by Omnibus Amendment No. 2 dated as of August 6, 2012, and as amended, supplemented or modified, the “Canadian Credit Agreement”) (the U.S. Credit Agreement and the Canadian Credit Agreement being collectively referred to as the “Combined Credit Agreements”).
C.    The Combined Borrowers have requested that the Required Lenders agree, and the Required Lenders have agreed, to amend certain provisions of the Combined Credit Agreements.
D.    NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
Section 1.Defined Terms.  Each capitalized term used herein but not otherwise defined herein has the meaning given to such term in the U.S. Credit Agreement, as amended by this Amendment.  Unless otherwise indicated, all section references in this Amendment refer to applicable section of the Combined Credit Agreements.
Section 2.    Amendments to Combined Credit Agreements.

2.1    Amendments to Section 1.02.  The following definitions are hereby added where alphabetically appropriate to each of the Combined Credit Agreements to read as follows:

“Aggregate Swap MTM” has the meaning assigned to such term in Section 9.10(d).

“Swap Restructuring” has the meaning assigned to such term in Section 9.10(d).

“Third Amendment Effective Date” means October 5, 2012.

2.2    Amendments to Section 9.10(d).
		
	a)
	The last sentence of Section 9.10(d) of the Canadian Credit Agreement is hereby amended to read:

“Notwithstanding the foregoing, in no event shall the Parent or any Restricted Subsidiary terminate, unwind, cancel or otherwise dispose of any Oil and Gas Swap Agreements in respect of settlement payments thereto occurring prior to December 31, 2014; provided that the Parent or any Restricted Subsidiary may restructure any such settlement payments in respect of any Oil and Gas Swap Agreement (including, for the avoidance of doubt, any restructuring effected by means of a substantially concurrent termination and replacement that serves as a substitute for a restructuring) (a “Swap Restructuring”) if (a) the following conditions are satisfied on the date of any such Swap Restructuring after giving effect to any such Swap Restructuring, (i) the other requirements of Section 9.10(d) are satisfied, (ii) no Default has occurred and is continuing and (iii) the mark-to-market value of the Oil and Gas Swap Agreements of the Parent and its Restricted Subsidiaries attributable to settlement payments during the period prior to January 1, 2015 (the “Aggregate Swap MTM”) is, in the aggregate, not less than 95% of the Aggregate Swap MTM immediately prior to such Swap Restructuring and (b) within two business days of any Swap Restructuring the Parent has provided notice to the Administrative Agent that a Swap Restructuring was undertaken pursuant to this proviso, which notice shall also set forth (x) the amount of cash received by the Parent and any Restricted Subsidiary in connection with such Swap Restructuring and (y) any affected Oil and Gas Swap Agreements and any changes to the terms thereof that occurred in connection with such Swap Restructuring.”
		
	b)
	The last sentence of Section 9.10(d) of the U.S. Credit Agreement is hereby amended to read: 

“Notwithstanding the foregoing, in no event shall the Borrower or any Restricted Subsidiary terminate, unwind, cancel or otherwise dispose of any Oil and Gas Swap Agreements in respect of settlement payments thereto occurring prior to December 31, 2014; provided that the Borrower or any Restricted Subsidiary may restructure any such settlement payments in respect of any Oil and Gas Swap Agreement (including, for the avoidance of doubt, any restructuring effected by means of a substantially concurrent termination and replacement that serves as a substitute for a restructuring) (a “Swap Restructuring”) if (a) the 

2

following conditions are satisfied on the date of any such Swap Restructuring after giving effect to any such Swap Restructuring, (i) the other requirements of Section 9.10(d) are satisfied, (ii) no Default has occurred and is continuing and (iii) the mark-to-market value of the Oil and Gas Swap Agreements of the Borrower and its Restricted Subsidiaries attributable to settlement payments during the period prior to January 1, 2015 (the “Aggregate Swap MTM”) is, in the aggregate, not less than 95% of the Aggregate Swap MTM immediately prior to such Swap Restructuring and (b) within two business days of any Swap Restructuring the Borrower has provided notice to the Administrative Agent that a Swap Restructuring was undertaken pursuant to this proviso which notice shall also set forth (x) the amount of cash received by the Borrower and any Restricted Subsidiary in connection with such Swap Restructuring and (y) any affected Oil and Gas Swap Agreements and any changes to the terms thereof that occurred in connection with such Swap Restructuring.” 
Section 3.    Conditions Precedent.  This Amendment shall not become effective until the date on which each of the following conditions is satisfied (the “Third Amendment Effective Date”):
3.1    The Global Administrative Agent shall have received from each of the Combined Borrowers, the Required Lenders, the Global Administrative Agent and the Canadian Administrative Agent counterparts of this Amendment signed on behalf of such Person.
3.2    The Combined Borrowers shall have paid all amounts due and payable in connection with this Amendment on or prior to the Third Amendment Effective Date, including, to the extent invoiced at least one (1) Business Day prior to such date, all documented out-of-pocket expenses required to be reimbursed or paid by the Combined Borrowers under the Combined Credit Agreements.
Section 4.    Miscellaneous.
4.1    Confirmation.  All of the terms and provisions of the Combined Credit Agreements, as amended by this Amendment, are, and shall remain, in full force and effect following the effectiveness of this Amendment.  
4.2    Ratification and Affirmation; Representations and Warranties.  Each Combined Borrower hereby (a) acknowledges the terms of this Amendment; (a) ratifies and affirms its obligations under, and acknowledges, renews and extends its continued liability under, each Loan Document (as defined in the applicable Combined Credit Agreement as used in this Section) to which it is a party and agrees that each Loan Document to which it is a party remains in full force and effect, except as expressly amended hereby, notwithstanding the amendments contained herein; and (a) represents and warrants to the Lenders (as defined in the applicable Combined Credit Agreement) that as of the date hereof, after giving effect to the terms of this Amendment: (i) all of the representations and warranties contained in each Loan Document to which it is a party are true and correct in all material respects on and as of the Third Amendment Effective Date, except that to the extent any such representations and warranties are (x) expressly limited to an earlier date, in which case, on the Third Amendment Effective Date such representations and warranties shall 

3

continue to be true and correct as of such specified earlier date and (y) qualified by materiality, such representations and warranties (as so qualified) shall continue to be true and correct in all respects and (ii) no Default (as defined in the applicable Combined Credit Agreement) has occurred and is continuing as of the Third Amendment Effective Date.
7.2    Counterparts.  This Amendment may be executed by one or more of the parties hereto in any number of separate counterparts, and all of such counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed counterpart by facsimile or electronic mail shall be effective as delivery of a manually executed counterpart hereof.
7.3    Governing Law, Jurisdiction, etc. Sections 12.09 and 12.18 of the Canadian Credit Agreement shall be incorporated herein mutatis mutandis as this Amendment relates to the Canadian Credit Agreement and Sections 12.09 and 12.18 of the U.S. Credit Agreement shall be incorporated herein mutatis mutandis as this Amendment relates to the U.S. Credit Agreement.
 [SIGNATURES BEGIN NEXT PAGE]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first written above.

QUICKSILVER RESOURCES INC., a Delaware corporation
		
	By:
	/s/ Vanessa Gomez LaGatta     
Name:   Vanessa Gomez LaGatta 
Title:     Vice President – Treasurer

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

QUICKSILVER RESOURCES CANADA INC., an Alberta, Canada corporation
		
	By:
	/s/ Vanessa Gomez LaGatta     
Name:   Vanessa Gomez LaGatta 
Title:     Vice President – Treasurer

 

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

JPMORGAN CHASE BANK, N.A., as a Lender under the U.S. Credit Agreement and as Global Administrative Agent
		
	By:
	 /s/ David Morris     
Name:   David Morris 
Title:   Authorized Officer    

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

JPMORGAN CHASE BANK, N.A., TORONTO BRANCH,  as a Lender under the Canadian Credit Agreement and as Canadian Administrative Agent
		
	By:
	 /s/ Steve Voigt     
Name:  Steve Voigt 
Title:  Senior Vice President

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

BANK OF AMERICA, N.A., as a Lender under the U.S. Credit Agreement
		
	By:
	  /s/ Alia Qaddumi     
Name:  Alia Qaddumi     
Title:   Vice President    

BANK OF AMERICA, N.A., (by its Canada Branch) as a Lender under the Canadian Credit Agreement
By:      /s/ Medina Sales de Andrade         
    Name:     Medina Sales de Andrade 
    Title:      Vice President

BRANCH BANKING & TRUST COMPANY, as a Lender under the U.S. Credit Agreement and the Canadian Credit Agreement
By:     /s/ Ryan K. Michael         
    Name:    Ryan K. Michael 
    Title:  Senior Vice President

CANADIAN IMPERIAL BANK OF COMMERCE, as a Lender under the Canadian Credit Agreement
		
	By:
	 /s/ Randy Geislinger     
Name:  Randy Geislinger     
Title:  Executive Director

		
	By:
	 /s/ Joelle Chatwin     
Name:  Joelle Chatwin     
Title:  Executive Director

CIBC INC., as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Trudy Nelson         
    Name:  Trudy Nelson     
    Title:  Authorized Signatory    

By:     /s/ Richard Antl             
    Name:    Richard Antl 
    Title:  Authorized Signatory

CITIBANK, N.A., as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Phil Ballard     
Name:  Phil Ballard 
Title:  Vice President    

CITIBANK, N.A., CANADIAN BRANCH, as a Lender under the Canadian Credit Agreement
By:      /s/ Gordon Dekuyper     
    Name:  Gordon Dekuyper     
    Title:  Managing Director

COMERICA BANK, as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Katya Evseev         
Name:    Katya Evseev 
Title:  Assistant Vice President    

COMERICA BANK, CANADA BRANCH, as a Lender under the Canadian Credit Agreement
		
	By:
	  /s/ Omer Ahmed     
Name:  Omer Ahmed 
Title:  Portfolio Manager    

COMPASS BANK, as a Lender under the U.S. Credit Agreement
		
	By:
	  /s/ Umar Hassan         
Name:  Umar Hassan 
Title:  Vice President

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK, as a Lender under the U.S. Credit Agreement and the Canadian Credit Agreement
		
	By:
	  /s/ Tom Byargeon     
Name:  Tom Byargeon 
Title:  Managing Director    

		
	By:
	  /s/ Sharada Manne     
Name:  Sharada Manne     
Title:  Managing Director    

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Lender under the U.S. Credit Agreement
		
	By:
	  /s/ Mikhail Faybusovich         
Name:  Mikhail Faybusovich 
Title:  Director    

		
	By:
	/s/ Michael D. Spaight     
Name:  Michael D. Spaight 
Title:  Associate

CREDIT SUISSE AG, TORONTO BRANCH, as a Lender under the Canadian Credit Agreement
		
	By:  
	  /s/ Alain Daoust     
Name: Alain Daoust     
Title:  Director    

By:     /s/ Paul White                 
    Name:  Paul White 
    Title: Vice President
       Credit Suisse, AG, Toronto Branch

DEUTSCHE BANK TRUST COMPANY AMERICAS, as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Michael Getz     
Name:  Michael Getz 
Title:   Vice President    

		
	By:
	  /s/ Courtney E. Meehan     
Name:  Courtney E. Meehan     
Title:   Vice President    

DEUTSCHE BANK AG CANADA BRANCH, as a Lender under the Canadian Credit Agreement
		
	By:
	  /s/ Paul M. Jurist     
Name:  Paul M. Jurist 
Title:   Managing Director & Principal Officer    

By:          /s/ Marcellus Leung             
    Name:  Marcellus Leung 
    Title:  Assistant Vice President

EXPORT DEVELOPMENT CANADA, as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Richard Leong     
Name:  Richard Leong     
Title:  Asset Manager    

		
	By:
	  /s/ Trevor Mulligan     
Name:  Trevor Mulligan     
Title:  Asset Manager    

GOLDMAN SACHS BANK USA, as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Michelle Latzoni     
Name:  Michelle Latzoni     
Title:  Authorized Signatory    

KEYBANK, N.A., as a Lender under the U.S. Credit Agreement
		
	By:
	  /s/ Sherri Manson     
Name:  Sherri Manson     
Title:  Senior Vice President

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

THE BANK OF NOVA SCOTIA, as a Lender under the U.S. Credit Agreement and the Canadian Credit Agreement
By:   Terry Donovan             
    Name:  Terry Donovan 
    Title: Managing Director

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

THE ROYAL BANK OF SCOTLAND plc, as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Sanjay Remond     
Name:  Sanjay Remond     
Title: Authorised Signatory    

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

THE ROYAL BANK OF SCOTLAND N.V., (CANADA) BRANCH, as a Lender under the Canadian Credit Agreement
		
	By:
	 /s/ Shehan J. De Silva     
Name: Shehan J. De Silva     
Title:  Vice President    

/s/ David Wright     
Name: David Wright     
Title:  Director
Head of Client Management Canada
    
TORONTO DOMINION (NEW YORK) LLC, as a Lender under the U.S. Credit Agreement
		
	By:
	/s/ Bebi Yasin     
Name:  Bebi Yasin     
Title:  Authorized Signatory    

THE TORONTO-DOMINION BANK, as a Lender under the Canadian Credit Agreement
		
	By:
	/s/ Bebi Yasin     
Name:  Bebi Yasin     
Title:  Authorized Signatory

U.S. BANK NATIONAL ASSOCIATION, as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Heather Han     
Name:  Heather Han     
Title: Senior Vice President    

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

UBS LOAN FINANCE LLC, as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Irja R. Otsa     
Name:  Irja R. Otsa     
Title:  Associate Director

Banking Products Services, US     

		
	By:
	 /s/ David Urban     
Name:  David Urban     
Title:  Associate Director

Banking Products Services, US    

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

UBS AG CANADA BRANCH, as a Lender under the Canadian Credit Agreement
		
	By:
	 /s/ Irja R. Otsa     
Name:  Irja R. Otsa     
Title:  Attorney-in-fact    

		
	By:
	 /s/ David Urban     
Name:  David Urban 
Title:  Attorney-in-fact    

WELLS FARGO BANK, N.A., as a Lender under the U.S. Credit Agreement
		
	By:
	 /s/ Juan Carlos Sandoval     
Name:  Juan Carlos Sandoval     
Title:  Director

SIGNATURE PAGE TO OMNIBUS AMENDMENT NO. 3 TO
COMBINED CREDIT AGREEMENTS

WELLS FARGO FINANCIAL CORPORATION CANADA, as a Lender under the Canadian Credit Agreement

		
	By:
	 /s/ Juan Carlos Sandoval     
Name:  Juan Carlos Sandoval     
Title:  DirectorKWK 10K EX 10.48

Exhibit 10.48

FIRST AMENDMENT TO ACQUISITION AND EXPLORATION AGREEMENT
This First Amendment to Acquisition and Exploration Agreement (this “First Amendment”), entered into as of the  20th day of November, 2012 (the “First Amendment Date”), is by and between Quicksilver Resources Inc. (“Quicksilver”), a Delaware corporation, whose address is 801 Cherry Street, Suite 3700, Unit 19, Fort Worth, Texas 76102, and SWEPI LP (“SWEPI”), a Delaware limited partnership, whose address is 200 North Dairy Ashford, Houston, Texas  77079.  Quicksilver and SWEPI may be referred to individually as a “Party,” and collectively as the “Parties.”
RECITALS
		
	A.
	The Parties have previously executed that certain Acquisition and Exploration Agreement (the “Original Agreement”), dated the 20th day of September, 2012.

		
	B.
	The Parties now desire to make certain modifications and amendments to the Original Agreement as more specifically set forth in this First Amendment.

NOW, THEREFORE, in consideration of the foregoing and of the mutual promises and covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

ARTICLE 1 - AMENDMENT OF CERTAIN EXHIBITS

		
	1.1
	Quicksilver Wells Exhibit.  Exhibit B to the Original Agreement (Schedule of Quicksilver Wells) is hereby deleted in its entirety and is fully amended and replaced by Exhibit B attached to this First Amendment.

		
	1.2
	Interim Wells Exhibit.  Exhibit O to the Original Agreement (Interim Wells) is hereby deleted in its entirety and is fully amended and replaced by Exhibit O attached to this First Amendment.

ARTICLE 2 - BONUS PAYMENT

Article 2.2 of the Original Agreement is hereby amended by deleting the phrase “Article 3.6.a.”, found in the seventh and eighth lines of Article 2.2, and replacing it with the phrase “Articles 3.6.a. and 3.6.b.”.
 
ARTICLE 3 - DISCLOSURE OF AFES FOR INTERIM WELLS

Article 2.9 of the Original Agreement is hereby deleted in its entirety and is fully amended and replaced by the following language:

First Amendment to Acquisition and Exploration Agreement
Page 1 of 6

2.9    Interim Wells.  At least ten (10) days prior to Closing, each Party will provide an AFE for each of the Interim Wells it operates to the other Party.  With respect to each Interim Well that is located on a Lease or Oil and Gas Interest that is not excluded from this Agreement pursuant to the terms of this Agreement, at Closing each Party agrees to (a) reimburse the other Party who operates such Interim Well for such non-operating Party’s Proportionate Share of all costs such operating Party incurred as of November 30, 2012 with respect to such Interim Well that would be chargeable to the Joint Account pursuant to the Operating Agreement as if the Operating Agreement was in effect for such Interim Well, which costs shall be substantiated in an invoice delivered by such operating Party to such non-operating Party on or before December 10, 2012 and (b) participate in the drilling and completion of such Interim Well from and after Closing, (including the payment of costs for such Interim Well that are incurred from and after December 1, 2012), pursuant to the terms and conditions of the applicable operating agreement or Federal/State Unit Operating Agreement.

ARTICLE 4 - DEFECT NOTIFICATION

Notwithstanding the sixty (60) day period described in Article 3.2 of the Original Agreement, if SWEPI determines that any of the Leases covering lands located in the Sombrero Unit Area (COC-72192X), as described in that certain Unit Agreement for the Development and Operation of the Sombrero Unit Area – Moffat County, Colorado – dated June 1, 2007, are subject to any Title Defect(s) or Lease Defect(s) (all such defects are described together in this First Amendment as the “Sombrero Unit Defects”), SWEPI shall deliver to Quicksilver written notice(s) (whether one or more, the “Sombrero Unit Notice”) of the Sombrero Unit Defects on or before eighty-one (81) days after the Effective Date, along with written documentation in reasonable detail describing the Sombrero Unit Defects.  Any Sombrero Unit Defects that are not contained in the Sombrero Unit Notice as of the expiration of such eighty-one (81) day period shall be deemed waived as to the affected Quicksilver Interest(s), Quicksilver Lease(s) and Quicksilver Well(s).  Waiver and cure of the Sombrero Unit Defects shall otherwise be governed by the provisions of the Original Agreement.    

ARTICLE 5 - TITLE DEFECTS

		
	5.1
	Title Defects.  Articles 3.3.b. and 3.3.c. of the Original Agreement are hereby deleted in their entirety and are fully amended and replaced by the following:

		
	b.
	entitles Quicksilver to receive not less than seventy-five percent (75%) of the production attributable to Quicksilver’s working interest in each Quicksilver Interest, Quicksilver Lease and Quicksilver Well.

		
	c.
	entitles SWEPI to receive not less than seventy-five percent (75%) of the production attributable to SWEPI’s working interest in each SWEPI Interest and SWEPI Lease.

 
		
	5.2
	Mortgages.  Subclause (ii) of Article 3.3.e. of the Original Agreement is hereby deleted in its entirety and is fully amended and replaced by the following:

First Amendment to Acquisition and Exploration Agreement
Page 2 of 6

(ii) any and all mortgages, deeds of trust, financing statements or security agreements (“Mortgage Documents”) covering a lessor’s fee estate in and to the lands subject to a Lease to the extent the Mortgage Documents (A) were placed of record after the recording of the applicable Lease or (B) are not subordinate to the Lease and for which no complaint of foreclosure has been asserted or filed or any similar action has been taken by or on behalf of the mortgagee, beneficiary or secured party under such Mortgage Documents,

ARTICLE 6 - DEFECT ADJUSTMENTS 

Article 3.6.a. of the Original Agreement is hereby deleted in its entirety and is fully amended and replaced by the following:

		
	a.
	If any Title Defect or Environmental Defect is not cured or removed to the reasonable satisfaction of the obtaining Party on or before ninety (90) days after the Effective Date, and the obtaining Party does not waive such Title Defect or Environmental Defect, then the obtaining Party shall be entitled to the following adjustments (each, a “Defect Adjustment”):

		
	(i) 
	with respect to any such Title Defect (other than those arising out of a Party’s failure to own Marketable Title in a Lease or Oil and Gas Interest on account of the matters described in Article 3.3.a.) and Environmental Defect, 

		
	(A) 
	the Oil and Gas Interest(s) and Lease(s) affected by such Title Defect or Environmental Defect shall be excluded from this Agreement, Exhibit A-1 or A-2, as the case may be, and the Assignment of Interest or Oil and Gas Lease to be delivered to the obtaining Party at Closing, and the aggregate number of net mineral acres covered by such Oil and Gas Interest(s) and Lease(s) shall not be taken into consideration for purposes of calculating the Bonus Payment to be paid at Closing, and/or 

		
	(B)
	the Quicksilver Well(s) affected by such Title Defect or Environmental Defect and the number of net mineral acres covered by an Oil and Gas Interest or a Lease and included within the state prescribed pro-ration unit associated with any such Quicksilver Well(s) shall be (1) excluded from this Agreement, Exhibit A-1 and Exhibit B and the Assignment of Interest or Oil and Gas Lease and assignment and bill of sale to be delivered by Quicksilver to SWEPI at Closing pursuant to Article 2.4 and (2) disregarded for purposes of calculating the amount of the Bonus Payment to be paid at Closing, and 

First Amendment to Acquisition and Exploration Agreement
Page 3 of 6

		
	(ii)
	with respect to any such Title Defect arising under Article 3.3.a. whereby a Party is entitled to a number of net mineral acres located within the SWAN Project Area for a Lease or Oil and Gas Interest which is less than the number of net mineral acres set forth in Exhibit A-1 or A-2, as applicable, located within the SWAN Project Area for such Lease or Oil and Gas Interest, (A) the obtaining Party shall accept such Lease or Oil and Gas Interest (together with any Quicksilver Well located on the lands covered by such Lease or Oil and Gas Interest) affected by such Title Defect and (B) the number of net mineral acres described on Exhibit A-1 or A-2, as the case may be, for such Lease or Oil and Gas Interest shall be adjusted and amended to reflect the actual number of net mineral acres owned by the non-obtaining Party in and to such Lease or Oil and Gas Interest in the SWAN Project Area; provided, however, that if a Party is not entitled to any net mineral acres located within the SWAN Project Area for a Lease or Oil and Gas Interest, such Lease or Oil and Gas Interest (together with any Quicksilver Well located on the lands covered by such Lease or Oil and Gas Interest) affected by such Title Defect shall be excluded from this Agreement and Exhibit A-1 or A-2, as the case may be.  In all cases where a Defect Adjustment occurs pursuant to this Article 3.6.a.(ii), the actual number of net mineral acres owned by the non-obtaining Party in and to a Lease or Oil and Gas Interest and located within the SWAN Project Area shall be used for the purpose of calculating the Bonus Payment to be paid at Closing.  The Parties specifically agree that this Agreement only includes the net mineral acres in a Lease and Oil and Gas Interests in the SWAN Project Area as outlined in Exhibit C. 

Notwithstanding the foregoing, there shall be no Defect Adjustment on account of an Environmental Defect to the extent the estimated cost and expense to take such actions as are reasonable and necessary under environmental law to remediate or cure such condition does not exceed $3,176,555. 

ARTICLE 7 - DESIGNATION OF OPERATORSHIP FOR CERTAIN LANDS

Notwithstanding anything in Article 5.2 of the Original Agreement to the contrary, Quicksilver shall be designated as the operator for all operations in the tracts described in subclauses (c), (d), and (e) of Article 5.2 of the Original Agreement.

First Amendment to Acquisition and Exploration Agreement
Page 4 of 6

ARTICLE 8 - CONFIDENTIALITY

		
	8.1
	Disclosure of Financial Parameters.  The third sentence of Article 14.6 of the Original Agreement is hereby deleted in its entirety and is fully amended and replaced by the following: 

Neither Party shall disclose the financial parameters of this Agreement in such press release or announcement, except to the extent required by government regulation or law. 

		
	8.2
	Disclosure to Lenders.  SWEPI hereby acknowledges that Quicksilver may from time to time disclose Confidential Information to Quicksilver’s lenders for the purpose of discussing Quicksilver’s potential use and disposition of the Bonus Payment.

ARTICLE 9 - MISCELLANEOUS

		
	9.1
	Definition of Certain Terms.  Unless the context requires otherwise, capitalized terms used but not otherwise defined in this First Amendment shall have the meanings given them in the Original Agreement.

		
	9.2
	Reaffirmation of Agreement.  As amended by this First Amendment, each Party hereby reaffirms (a) its obligations under the Original Agreement and (b) the rights of the other Party under the Original Agreement.

		
	9.3
	Counterpart Signatures.  This First Amendment may be executed in one or more counterparts, each of which shall be deemed an original and when taken together shall constitute one and the same instrument.  Copies (whether by facsimile, e-mail or otherwise) of signatures to this First Amendment shall be deemed to be originals and may be relied on to the same extent as the originals.

[SIGNATURE PAGE FOLLOWS]

First Amendment to Acquisition and Exploration Agreement
Page 5 of 6

IN WITNESS WHEREOF, this First Amendment is executed as of the First Amendment Date to be effective as of the Effective Date.

	
		
	Quicksilver Resources Inc.
	SWEPI LP

	

By:  /s/ Clay Blum            

Printed Name:  Clay Blum         

Title: VP U.S. Land            

	

By: /s/ Jeff Turnbull

Printed Name:   Jeff Turnbull         

Title: Attorney in fact            

First Amendment to Acquisition and Exploration Agreement
Page 6 of 6

Exhibit "B"

Schedule of Quicksilver Wells

Exhibit "O"

Interim Wells

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