FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) is entered into as of December 22, 2010, by and among PETROLEUM DEVELOPMENT CORPORATION (the “Borrower”), CERTAIN SUBSIDIARIES OF THE BORROWER, as Guarantors (the “Guarantors”), the LENDERS party hereto (the “Lenders”) and JPMORGAN CHASE BANK, N.A., as Administrative Agent (the “Administrative Agent”). Unless the context otherwise requires or unless otherwise expressly defined herein, capitalized terms used but not defined in this Amendment have the meanings assigned to such terms in the Credit Agreement (as defined below).

 

WHEREAS, the Borrower, the Guarantors, the Administrative Agent and the Lenders have entered into that certain Second Amended and Restated Credit Agreement dated as of November 5, 2010 (as the same has been and may hereafter be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”); and

 

WHEREAS, the Borrower and the Guarantors have requested that the Administrative Agent and the Lenders amend the Credit Agreement in certain respects and the Administrative Agent and the Lenders have agreed to do so on the terms and conditions hereinafter set forth.

 

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

 

 

 

 

 

1.2     Amended Definitions. The following definitions in Section 1.01 of the Credit Agreement shall be and they hereby are amended and restated in their entirety to read as follows:

 

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding accounts payable incurred in the ordinary course of business that are not past due), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person of

 

 

 

 

1.3     Mortgages and Other Security. The last sentence of Section 6.09 of the Credit Agreement shall be and it hereby is amended and restated in its entirety to read as follows:

 

 

1.4     Swap Agreements. Section 6.11 of the Credit Agreement shall be and it hereby is amended by adding the following sentence to the end thereof:

 

1.5     Investments, Loans, Advances, Guarantees and Acquisitions. Section 7.04 of the Credit Agreement shall be and it hereby is amended by (i) deleting the word “and” at the end of clause (k) thereof, (ii) deleting the period at the end of clause (l) thereof and inserting the punctuation and word “; and” in lieu thereof, and (iii) adding a new clause (m) to read as follows:

 

 

1.6     Swap Agreements. The lead-in phrase to Section 7.05 of the Credit Agreement shall be and it hereby is amended and restated to read as follows:

 

The Borrower will not, nor will the Borrower permit any of its Restricted Subsidiaries or any Sponsored Partnership to, enter into any Swap Agreement, except (x) the Existing Swap Agreements, (y) the Permitted Convertible Notes Swap Agreements and (z) Swap Agreements entered into with an Approved Counterparty in the ordinary course of business and not for speculative purposes to:

 

1.7     Swap Agreements. Clause (a) of Section 7.05 of the Credit Agreement shall be and it hereby is amended and restated in its entirety to read as follows:

 

1.8     Restricted Payments. Section 7.06 of the Credit Agreement shall be and it hereby is amended and restated in its entirety to read as follows:

 

1.9     Disqualified Stock. Section 7.09 of the Credit Agreement shall be and it hereby is amended by adding the following sen tence to the end thereof:

 

Notwithstanding the foregoing, in no event shall this Section 7.09 apply to any Permitted Convertible Notes Swap Agreement.

 

1.10     Senior Notes Restrictions. Section 7.13 of the Credit Agr eement shall be and it hereby is amended and restated in its entirety to read as follows:

 

 

1.11     Events of Default. Clause (g) of Article IX of the Credit Agreement shall be and it hereby is amended and restated in its entirety to read as follows:

 

 

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

 

2.1     Execution and Delivery. Each Credit Party, the Majority Lenders, and the Administrative Agent shall have executed and delivered this Amendment and each other required documen t, all in form and substance satisfactory to the Administrative Agent.

 

2.2     No Default. No Default shall have occurred and be continuing or shall result from the effectiveness of this Amendment.

 

2.3     Governmental Approvals. All governmen tal and third party approvals necessary or, in the discretion of the Administrative Agent, advisable in connection with the financing contemplated by the Credit Agreement, as amended to date, and by this Amendment and the continuing operations of the Borrower and its Subsidiaries shall have been obtained and be in full force and effect.

 

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

 

SECTION 3.     Representations and Warranties of Credit Parties. To induce the Lenders to enter into this Amendment, each Credit Party hereby represents and warrants to the Lenders as follows:

 

3.1     Reaffirmation of Representations and Warranties/Further Assurances. After giving effect to the amendments contained herein, each representation and warranty of such Credit Party contained in the Credit Agreement or in any other Loan Document is true and correct in all material respects on the date hereof (except to the extent such representations and warranties relate solely to an earlier date, in which case they are true and correct as of such earlier date).

 

3.2     Corporate Authority; No Conflicts. The execution, delivery and performance by such Credit Party of this Amendment and all documents, instruments and agreements contemplated herein are within such Credit Party's corporate or other organizational powers, have been duly authorized by necessary action, require no action by or in respect of, or filing with, any court or agency of government and do not violate or constitute a default under any provision of any applicable law or other agreements binding upon such Credit Party or result in the creation or imposition of any Lien upon any of the assets of such Credit Party.

 

3.3    Enforceability. This Amendment constitutes the valid and binding obligation of such Credit Party enforceable in accordance with its terms, except as (i) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditor's rights generally, and (ii) the availability of equitable remedies may be limited by equitable principles of general application.

 

3.4     No Default. As of the date hereof, both before and immediately after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

 

 

SECTION 4.     Miscellaneous.

 

 

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

 

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

 

4.4     Counterparts. This Amendment may be executed in one or more counterparts and by different parties hereto in separate counterparts each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. Delivery of photocopies of the signature pages to this Amendment by facsimile or

electronic mail shall be effective as delivery of manually executed counterparts of this Amendment.

 

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

 

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

 

4.7     Governing Law. This Amendment shall be construed in accordance with and governed by the law of the State of New York.