Exhibit 10(v)-10
SUPPLEMENT AGREEMENT
     THIS SUPPLEMENT AGREEMENT (this “Agreement”) dated as of July 25, 2008, is
being executed and delivered pursuant to the provisions of Section 2.24 of that
certain Amended and Restated Credit Agreement dated as of November 28, 2007,
among ENERGYSOUTH, INC. and BAY GAS STORAGE COMPANY, LTD., as Borrowers, the
Lenders from time to time parties thereto, and REGIONS BANK, as Administrative
Agent for the Lenders, as amended by that certain First Amendment to Amended and
Restated Credit Agreement dated as of July 25, 2008 (as so amended, and as the
same may hereafter be further amended, restated and supplemented from time to
time, the “Credit Agreement”), by each of the existing Lenders listed on the
signature pages hereto (each a “Consenting Lender” and collectively the
“Consenting Lenders”), and the Borrowers, and accepted by the Administrative
Agent. Capitalized terms used herein and not otherwise defined herein shall have
the meanings assigned to such terms in the Credit Agreement.
BACKGROUND
A. Pursuant to Section 2.24 of the Credit Agreement, the Parent Borrower has
notified the Administrative Agent that the Parent Borrower proposes to increase
the Aggregate ESI Commitment Amount under the Credit Agreement to the total
amount of $225,000,000.
B. Each of the Consenting Lenders has agreed to increase its ESI Commitment by
the amount specified for such Consenting Lender on Schedule I attached to this
Agreement.
C. The parties to this Agreement are entering into this Agreement for purposes
of effecting the increase in the ESI Commitments of the Consenting Lenders as
contemplated by Section 2.24 of the Credit Agreement.
     Accordingly, each of the parties to this Agreement hereby agrees as
follows:
1. Each of the Consenting Lenders hereby agrees to increase the amount of its
ESI Commitment to the Parent Borrower under the Credit Agreement by the
respective amount for such Consenting Lender shown as being its “Increase in ESI
Commitment” on Schedule I attached to this Agreement. Such increase shall take
effect for all purposes of the Credit Agreement on the Effective Date (as
hereinafter defined) of this Agreement.
2. Each party hereto acknowledges and agrees that the respective ESI Commitments
of the Consenting Lenders and the other ESI Lenders under the Credit Agreement
are several and not joint commitments and obligations of such ESI Lenders. After
giving effect to the additional and increased ESI Commitments as provided in
this Agreement, each party further acknowledges and agrees that upon the funding
of any additional ESI Borrowings on or after the Effective Date, the outstanding
principal amounts of all ESI Commitments and the respective Percentages of the
ESI Lenders are those set forth on Schedule II.

 

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3. Each party hereto agrees that this Agreement and the effectiveness of the
increased ESI Commitments as provided in this Agreement shall be subject to
satisfaction by the Borrower of the following conditions and requirements:
     (a) The Borrowers shall have delivered to the Administrative Agent the
following in form and substance satisfactory to the Administrative Agent:
     (i) a counterpart of this Agreement signed by the Consenting Lenders, the
Borrower and the Administrative Agent;
     (ii) a duly executed Note payable to each Consenting Lender to the extent
requested by any such Consenting Lender;
     (iii) a certificate of the Secretary or Assistant Secretary of the Parent
Borrower, attaching and certifying copies of the authorizing resolutions for the
increased ESI Commitments and any ESI Borrowings thereunder as provided in this
Agreement; and
     (iv) the favorable written opinion of Armbrecht Jackson LLP, as counsel to
the Borrowers, addressed to the Administrative Agent and each of the Lenders,
and covering such matters relating to the Borrowers and this Agreement and the
transactions contemplated herein as the Administrative Agent shall reasonably
request.
     (b) The Parent Borrower shall have paid to the Administrative Agent (i) all
costs and expenses incurred by the Administrative Agent in connection with this
Agreement and the transactions contemplated herein, including without
limitation, all reasonable fees and expenses of counsel for the Administrative
Agent, and (ii) for the account of each Consenting Lender, an upfront fee in an
amount equal to 0.375% of such Consenting Lender’s Increase in Commitment, as
shown on Schedule I to this Agreement.
The date on which the foregoing conditions have been satisfied shall be the
“Effective Date” of this Agreement.
4. The Borrowers represent and warrant to the Administrative Agent and the
Lenders as of the Effective Date that (i) this Agreement has been duly
authorized, executed and delivered by the Parent Borrower, (ii) the Credit
Agreement, as supplemented hereby, and the other Loan Documents constitute the
legal, valid and binding obligations of the Borrowers and the other Loan Parties
enforceable against the Borrowers and the other Loan Parties in accordance with
their terms except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting the enforcement of
creditors’ rights generally and by general principles of equity, (iii) no
Default or Event of Default exists, (iv) all representations and warranties of
the Borrowers set forth in the Credit Agreement are true and correct in all
material respects on such date (or, if any such representation or warranty is
expressly stated to

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have been made as of a specific date, as of such specific date), and (v) since
the date of the most recent financial statements of the Borrowers delivered to
the Lenders pursuant to Section 5.1 of the Credit Agreement, there has been no
change which has resulted in, or could reasonably be expected to result in, a
Material Adverse Effect.
5. Except as supplemented hereby, the Credit Agreement and all other documents
executed in connection therewith shall remain in full force and effect. The
Credit Agreement, as supplemented hereby, and all rights, powers and obligations
created thereby or thereunder and under the Loan Documents and all such other
documents executed in connection therewith are in all respects ratified and
confirmed.
6. This Agreement may be executed in multiple counterparts, each of which shall
constitute an original but all of which when taken together shall constitute one
contract. Signature pages may be detached from multiple separate counterparts
and attached to a single counterpart so that all signature pages are attached to
the same document. Delivery of an executed counterpart by facsimile or other
electronic means shall be effective as delivery of a manually executed
counterpart of this Agreement. This Agreement, together with the applicable
provisions of the Credit Agreement, constitutes the entire agreement among the
parties hereto regarding the subject matter hereof and supersedes all prior
agreements and understandings, oral or written, regarding such subject matter.
7. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA.

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     IN WITNESS WHEREOF, the Consenting Lenders and the Borrowers have caused
this Agreement to be duly executed and delivered by their respective authorized
officers and representatives, and the Administrative Agent, for the benefit of
the Consenting Lenders, and all other Lenders under the Credit Agreement, has
caused the same to be accepted by its authorized officer, as of the day and year
first above written.

            REGIONS BANK,
as a Consenting Lender
      By:   /s/ Edward Midyett         Name:   Edward Midyett        Title:  
Vice President     

[SIGNATURE PAGE TO SUPPLEMENT AGREEMENT]

 

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            JPMORGAN CHASE BANK, N.A.,
as a Consenting Lender
      By:   /s/ Nancy R. Barwig         Name:   Nancy R. Barwig        Title:  
Vice President     

[SIGNATURE PAGE TO SUPPLEMENT AGREEMENT]

 

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                  ENERGYSOUTH, INC.,         as the Parent Borrower    
 
           
 
  By:   /s/ Charles P. Huffman    
 
           
 
      Name: Charles P. Huffman    
 
     
Title: Executive Vice President and Chief Financial Officer
   
 
                BAY GAS STORAGE COMPANY, LTD.,         as the Subsidiary
Borrower    
 
           
 
  By:   EnergySouth Midstream, Inc.,    
 
      its sole general partner      
 
  By:   /s/ Charles P. Huffman    
 
           
 
      Name: Charles P. Huffman    
 
     
Title: Executive Vice President and Chief Financial Officer
   

          ACCEPTED THIS 25th     DAY OF JULY, 2008:    
 
        REGIONS BANK,     as Administrative Agent    
 
       
By:
  /s/ Edward Midyett    
 
       
 
  Name: Edward Midyett    
 
  Title: Vice President    

[SIGNATURE PAGE TO SUPPLEMENT AGREEMENT]

 

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Schedule I
INCREASED ESI COMMITMENTS

          Consenting Lenders   Increases in ESI Commitments
Regions Bank
  $ 15,000,000  
JPMorgan Chase Bank, N.A.
    15,000,000  

TOTAL INCREASES:      $30,000,000

 

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Schedule II
ESI LENDER COMMITMENTS AND PERCENTAGES*

                      ESI Commitment     ESI Lenders   Amounts   Percentages
Regions Bank
  $ 60,000,000       26.66666667 %
JPMorgan Chase Bank, N.A.
    65,000,000       28.88888889 %
SunTrust Bank
    50,000,000       22.22222222 %
Union Bank of California, N.A.
    50,000,000       22.22222222 %
TOTAL
  $ 225,000,000       100.00000000 %

 

*   Upon the effectiveness of the Increases in ESI Commitments as provided in
the Supplement Agreement

 

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GUARANTORS’ ACKNOWLEDGMENT AND AGREEMENT
     Each of the undersigned Guarantors consents to the execution and delivery
by the Borrowers of the foregoing Supplement Agreement and jointly and severally
ratifies and confirms the terms of the Subsidiary Guarantee with respect to all
indebtedness now or hereafter outstanding under the Credit Agreement as
supplemented hereby and all promissory notes issued thereunder. Each of the
undersigned Guarantors acknowledges and agrees that, notwithstanding anything to
the contrary contained herein or in any other document evidencing any
indebtedness of the Borrowers to the Lenders or any other obligation of the
Borrowers, or any actions now or hereafter taken by the Lenders with respect to
any obligations of the Borrowers, the Subsidiary Guarantee (i) is and shall
continue to be an absolute, unconditional, joint and several, continuing and
irrevocable guarantee of payment of all “Parent Guaranteed Obligations” and
“Subsidiary Borrower Guaranteed Obligations” to the extent and as provided
therein, including without limitation, all Borrowings and Letters of Credit made
and issued under the Credit Agreement, as supplemented hereby, and (ii) is and
shall continue to be in full force and effect in accordance with its terms.
Nothing contained herein to the contrary shall release, discharge, modify,
change or affect the obligations or liabilities of any Guarantor under the
Subsidiary Guarantee.
[Signature Page Follows]

 

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                  GUARANTORS:    
 
                ENERGYSOUTH MIDSTREAM, INC.    
 
           
 
  By:   /s/ Charles P. Huffman    
 
           
 
      Name: Charles P. Huffman    
 
     
Title: Executive Vice President and Chief Financial Officer
   
 
                ENERGYSOUTH SERVICES, INC.    
 
           
 
  By:   /s/ Charles P. Huffman    
 
           
 
      Name: Charles P. Huffman    
 
     
Title: Executive Vice President and Chief Financial Officer
   
 
                MGS MARKETING SERVICES, INC.    
 
           
 
  By:   /s/ Charles P. Huffman    
 
           
 
      Name: Charles P. Huffman    
 
     
Title: Executive Vice President and Chief Financial Officer
   

[SIGNATURE PAGE TO GUARANTORS’
ACKNOWLEDGMENT AND AGREEMENT]