LIMITED WAIVER
Exhibit 10.1
THIS
LIMITED WAIVER (this “Waiver”) dated
as of August 30, 2018, among YUMA ENERGY, INC., a Delaware
corporation (“Yuma Energy”),
YUMA EXPLORATION AND PRODUCTION
COMPANY, INC., a Delaware corporation, PYRAMID OIL LLC, a California
limited liability company, and XXXXX PETROLEUM CORP., a Delaware
corporation (“Xxxxx”, and
together with Yuma Energy, Yuma Exploration and Production Company,
Inc., and Pyramid Oil LLC, the “Borrowers”,
and each a “Borrower”),
the Guarantors existing on the date hereof, the undersigned Lenders
party to the Credit Agreement (the “Lenders”) and
SOCIÉTÉ
GÉNÉRALE, in its capacity as Administrative Agent
(the “Administrative
Agent”).
RECITALS
A. The Borrowers, the
Lenders and the Administrative Agent are parties to that certain
Credit Agreement dated as of October 26, 2016 (as amended,
restated, amended and restated, supplemented or otherwise modified
from time to time prior to the date hereof, the “Credit
Agreement”).
B. Yuma Energy, in its
capacity as the Borrowing Agent, has delivered the Administrative Agent and the Lenders
under the Credit Agreement the Borrowers’ Compliance
Certificate dated as of August 29, 2018, with respect to
the fiscal quarter ended June 30, 2018, demonstrating
that Yuma Energy and its Subsidiaries failed to comply with certain
financial ratios required pursuant to Section 6.1 of the Credit
Agreement for the fiscal quarter ended
June 30, 2018.
C. The Borrowers have
requested that the Lenders waive any breaches under the Credit
Agreement resulting from such non-compliance, and, subject to the
conditions precedent set forth herein, the parties hereto have
agreed to waive any such breaches as set forth herein.
NOW,
THEREFORE, in consideration of these premises and for other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as
follows:
1. Same Terms. All terms used
herein that are defined in the Credit Agreement shall have the same
meanings when used herein, unless the context hereof otherwise
requires or provides. In addition, (i) all references in the Loan
Documents to the “Agreement” shall mean the Credit
Agreement, as amended by this Waiver, and (ii) all references in
the Loan Documents to the “Loan Documents” shall mean
the Loan Documents, as amended by this Waiver.
2. Limited Waiver.
A. At the request of
the Borrowers, and in reliance on the accuracy of the information
certified by the Borrowers in the Compliance Certificate dated
August 29, 2018, the Administrative Agent and the Lenders
hereby waive the non-compliance by the Borrowers with the financial
ratios specified in clauses (a), (b) and (c) of Section 6.1 of
the Credit Agreement as of the last day of the fiscal quarter ended
June 30, 2018, or for the four fiscal quarter period
ended June 30, 2018, as applicable.
B. The post-default
rate of interest, which would otherwise apply as a result of the
breach described in the foregoing clause (A) of this
Section 2 to
the aggregate outstanding amount of all Loans outstanding for the
period from June 30, 2018 until (but not including) the
date hereof, is hereby waived; provided that the waiver of the
post-default rate of interest herein shall apply only to the Events
of Default waived herein and not to any other Event of Default now
existing or that may hereafter occur.
The
waiver in this Section 2 is effective
only in respect of the matters and for the time periods expressly
set forth in this Section 2 and not for any
other period and, except as expressly set forth in this Waiver, no
other waivers are intended or made by this Waiver. No failure or
delay on the part of the Administrative Agent, any Lender, the
Issuing Bank or the holder of any Note in exercising any power or
right under the Credit Agreement or any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further
exercise thereof or the exercise of any other power or right. No
waiver or approval by the Administrative Agent, any Lender, the
Issuing Bank or the holder of any Note under this Waiver, the
Credit Agreement or any other Loan Document shall, except as may be
otherwise stated in such waiver or approval, be applicable to any
subsequent transaction or any Default or Event of Default under any
Loan Document.
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3. Conditions Precedent. This
Waiver shall become effective (the “Waiver Effective
Date”) upon each of the following conditions being
satisfied:
A. Waiver to Credit Agreement. The
Administrative Agent shall have received multiple original
counterparts, as requested by the Administrative Agent, of this
Waiver duly and validly executed and delivered by duly authorized
officers of the Borrowers, the Guarantors, the Administrative Agent
and each Lender.
B. Representations
and Warranties; No Defaults. Each Borrower shall have confirmed and
acknowledged to the Administrative Agent and the Lenders, and by
its execution and delivery of this Waiver, each Borrower does
hereby confirm and acknowledge to the Administrative Agent and the
Lenders, that (i) all representations and warranties contained
herein or in the other Loan Documents or otherwise made in writing
in connection herewith or therewith shall be true and correct with
the same force and effect as though such representations and
warranties have been made on and as of the Waiver Effective Date
and (ii) no Default or Event of Default exists under the Credit
Agreement or any of the other Loan Documents.
4. Certain Representations. Each
Borrower represents and warrants that, as of the Waiver Effective
Date: (A) each Borrower has full power and authority to
execute this Waiver and the other documents executed in connection
herewith and this Waiver and such other documents constitute the
legal, valid and binding obligation of each Borrower enforceable in
accordance with their terms, except as enforceability may be
limited by general principles of equity and applicable bankruptcy,
insolvency, reorganization, moratorium, and other similar laws
affecting the enforcement of creditors’ rights generally; and
(B) no authorization, approval, consent or other action by,
notice to, or filing with, any governmental authority or other
person is required for the execution, delivery and performance by
each Borrower thereof. In addition, each Borrower represents that
after giving effect to this Waiver all representations and
warranties contained in the Credit Agreement and the other Loan
Documents are true and correct in all material respects on and as
of the Waiver Effective Date as if made on and as of such date
except to the extent that any such representation or warranty
expressly relates solely to an earlier date, in which case such
representation or warranty is true and correct in all material
respects as of such earlier date.
5. Agreement Regarding Redetermination of
the Borrowing Base in September 2018. The parties
hereto agree that the Borrowing Base redetermination that was
contemplated by that certain Waiver and Third Amendment to Credit
Agreement dated as of July 31, 2018, to occur on or about
August 15, 2018, shall be, and hereby is, postponed until
on or about September 15, 2018 (the “September 2018
Redetermination”), whereupon the Borrowing Base shall
be redetermined based on the Engineering Reports most recently
provided by the Borrowing Agent to the Administrative Agent and the
Lenders, as well as any additional reports, data, or supplemental
information reasonably requested by the Required Lenders. Each of
the Borrowers, on the one hand, and the Administrative Agent and
the Lenders, on the other hand, agree and acknowledge that the
September 2018 Redetermination shall not constitute an Interim
Redetermination (or a Scheduled Redetermination).
6. No Further Amendments or
Waivers. Except as amended or waived hereby, the Credit
Agreement and the Loan Documents shall remain unchanged and all
provisions shall remain fully effective between the
parties.
7. Acknowledgments and Agreements.
Each Borrower acknowledges that on the date hereof all outstanding
Obligations are payable in accordance with their respective terms,
and each Borrower waives any defense, offset, counterclaim or
recoupment with respect thereto. Each Borrower, the Administrative
Agent and each Lender do hereby adopt, ratify and confirm the
Credit Agreement, as amended hereby, and the Loan Documents and
acknowledge and agree that the Credit Agreement, as amended hereby,
and the Loan Documents are and remain in full force and effect.
Each Borrower acknowledges and agrees that its liabilities and
obligations under the Credit Agreement, as amended hereby, and
under the Loan Documents, are not impaired in any respect by this
Waiver. Any breach of any representations, warranties and covenants
under this Waiver shall be an Event of Default under the Credit
Agreement.
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8. Limitation on Agreements. The
modifications set forth herein are limited precisely as written and
shall not be deemed (A) to be a consent under or a waiver of
or an amendment to any other term or condition in the Credit
Agreement or any of the Loan Documents (other than the waiver
provided for in Section
2 of this Waiver), or (B) to prejudice any right or
rights that the Administrative Agent now has or may have in the
future under or in connection with the Credit Agreement and the
Loan Documents, each as amended hereby, or any of the other
documents referred to herein or therein. This Waiver shall
constitute a Loan Document for all purposes.
9. Release of Administrative Agent,
Issuing Bank and Lenders; Etc. In consideration of the
amendments and waivers set forth in this Waiver, each of the
Borrowers and the Guarantors hereby releases, acquits, forever
discharges, and covenants not to xxx, the Administrative Agent, the
Issuing Bank and each Lender, along with all of their respective
beneficiaries, officers, directors, shareholders, agents,
employees, servants, attorneys, accountants, consultants,
affiliates, owners and representatives, as well as their respective
heirs, executors, legal representatives, administrators,
predecessors in interest, successors and assigns (each
individually, a “Released
Party” and collectively, the “Released
Parties”) from any and all claims, demands, damages,
costs, expenses, debts, liabilities, contracts, agreements,
obligations, accounts, defenses, suits, offsets against the
indebtedness evidenced by the Loan Documents, actions, causes of
action or claims for damages or relief of whatever kind or nature,
whether equitable or monetary, whether known or unknown, fixed,
contingent or conditional, at law or in equity, suspected or
unsuspected by any Borrower which any Borrower, any Guarantor or
any Subsidiary of any of them, has, had or may have against any
Released Party, for or by reason of any matter, cause or thing
whatsoever occurring on, or at any time prior to, the date of this
Waiver, including, without limitation, any matter that relates to,
in whole or in part, directly or indirectly (a) the Credit
Agreement, any Note, any Security Document, any other Loan Document
or the transactions evidenced thereby, including, without
limitation, any disbursements under the Credit Agreement, any
Notes, the negotiation of any of the Credit Agreement, the Notes,
the Mortgages, the Hazardous Materials Undertaking and Indemnity or
the other Loan Documents, the terms thereof, or the approval,
administration or servicing thereof, or (b) any notice of
default, event of default in reference to any Loan Document or any
other matter pertaining to the collection or enforcement by any
Released Party of the indebtedness evidenced by any Loan Document
or any right or remedy under any Loan Document, or (c) any
purported oral agreements or understandings by and between any
Released Party and any Borrower or any Guarantor in reference to
any Loan Document.
10. Confirmation of Security. Each
Borrower hereby confirms and agrees that all of the Security
Documents, as may be amended in accordance herewith, that presently
secure the Obligations shall continue to secure, in the same manner
and to the same extent provided therein, the payment and
performance of the Obligations as described in the Credit Agreement
as modified by this Waiver.
11. Counterparts. This Waiver may
be executed in any number of counterparts, each of which when
executed and delivered shall be deemed an original, but all of
which constitute one instrument. In making proof of this Waiver, it
shall not be necessary to produce or account for more than one
counterpart thereof signed by each of the parties
hereto.
12. Incorporation of Certain Provisions by
Reference. The provisions of Section 9.9 of the Credit
Agreement captioned “Governing Law; Jurisdiction; Waiver of
Venue; Service of Process” are incorporated herein by
reference for all purposes.
13. Entirety, Etc. This Waiver and
all of the other Loan Documents embody the entire agreement between
the parties. THIS WAIVER AND ALL OF THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES.
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IN
WITNESS WHEREOF, the parties hereto have executed this Waiver to be
effective as of the date and year first above written.
BORROWERS
By:
/s/ Xxx X.
Xxxxx
Name:
Xxx X. Xxxxx
Title:
Chief Executive Officer
YUMA
EXPLORATION AND PRODUCTION COMPANY, INC.
By:
/s/ Xxx X.
Xxxxx
Name:
Xxx X. Xxxxx
Title:
Chief Executive Officer
PYRAMID
OIL LLC
By:
/s/ Xxx X.
Xxxxx
Name:
Xxx X. Xxxxx
Title:
Chief Executive Officer
XXXXX
PETROLEUM CORP.
By:
/s/ Xxx X.
Xxxxx
Name:
Xxx X. Xxxxx
Title:
Chief Executive Officer
ADMINISTRATIVE
AGENT
AND
LENDER:
SOCIÉTÉ
GÉNÉRALE
By:
/s/ Xxxxx
Xxxxxxx
Name:
Xxxxx Xxxxxxx
Title:
Managing Director
LENDER:
CIT
BANK, N.A.
By:
/s/ Xxxx X. Xxxx,
III
Name:
Xxxx X. Xxxx, III
Title:
Senior Vice President
LENDER:
LEGACYTEXAS
BANK
By:
/s/ Xxxxxxxxxxx X.
Xxxxxx
Name:
Xxxxxxxxxxx X. Xxxxxx
Title:
Managing Director
THE
GUARANTORS HEREBY CONSENT TO THE EXECUTION, DELIVERY AND
PERFORMANCE OF THE TERMS OF THIS WAIVER BY THE
BORROWERS.
THE
YUMA COMPANIES, INC.
By:
/s/ Xxx X.
Xxxxx
Name:
Xxx X. Xxxxx
Title:
Chief Executive Officer
XXXXX
PETROLEUM ACQUISITION CORP.
By:
/s/ Xxx X.
Xxxxx
Name:
Xxx X. Xxxxx
Title:
Chief Executive Officer
