Exhibit 10.1
REAFFIRMATION AND SIXTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
     This REAFFIRMATION AND SIXTH AMENDMENT TO AMENDED AND RESTATED CREDIT
AGREEMENT (this “Amendment”) is dated as of November 27, 2006, and is entered
into by and among ENERGY WEST, INCORPORATED, a Montana corporation (the
“Company”), LASALLE BANK NATIONAL ASSOCIATION, a national banking association
(“LaSalle”), in its capacity as the Agent for the “Banks” party to the Credit
Agreement described below (in such capacity, the “Agent”), such Banks and each
other Loan Party.
     WHEREAS, the Agent, the Banks and the Company have entered into that
certain Amended and Restated Credit Agreement dated as of March 31, 2004 (as
such agreement has been and may hereafter be amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”); and
     WHEREAS, the Company has requested that the Credit Agreement be amended as
set forth herein and the Agent and the Banks are, subject to the terms hereof,
willing to so amend the Credit Agreement.
     NOW THEREFORE, in consideration of the mutual conditions and agreements set
forth in the Credit Agreement and this Amendment, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
     1. Definitions. Capitalized terms used in this Amendment, unless otherwise
defined herein, shall have the meaning ascribed to such terms in the Credit
Agreement.
     2. Amendments to Credit Agreement. Subject to satisfaction of the
conditions set forth in Section 4 below, the Credit Agreement is hereby amended
as follows:
          (a) the definitions of “Base Rate Margin”, “Commitment Fee Rate”, “L/C
Fee Rate”, “Libor Margin” and “Revolving Commitment Amount” appearing in
Section 1.1 of the Credit Agreement are hereby deleted in their entirety and the
following definitions are hereby substituted therefor:
“ ‘Base Rate Margin’ means: (i) with respect to Term Loan A, one percent (1.00%)
per annum; and (ii) with respect to Revolving Loans, one half percent (0.50%)
per annum.”;
“ ‘L/C Fee Rate’ means a rate of interest equal to one and one half percent
(1.50%) per annum.”;

 

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“ ‘LIBOR Margin’ means: (i) with respect to Term Loan A, two percent (2.00%) per
annum; and (ii) with respect to Revolving Loans, one and one half percent
(1.50%) per annum.” and
“ ‘Revolving Commitment Amount’ means $20,000,000.00, as reduced from time to
time pursuant to Section 6.1.”
          (b) the date of “November 27, 2006” appearing in the definition of
“Revolving Termination Date” in Section 1.1 of the Credit Agreement is hereby
deleted in its entirety and the date “November 26, 2007” is hereby substituted
therefor;
          (c) the following definitions of “Permitted Acquisitions” and “Target”
are hereby added to Section 1.1 of the Credit Agreement in the correct
alphabetical order:
“ “Permitted Acquisition” means any Acquisition by (i) the Company or any
Wholly-Owned Subsidiary of the Company which is a domestic Subsidiary of
substantially all of the assets of a Target, which assets are located in the
United States or (ii) a Borrower or any Wholly-Owned Subsidiary of a Borrower
which is a Domestic Subsidiary of 100% of the Stock and Stock Equivalents of a
Target incorporated under the laws of any State in the United States or the
District of Columbia to the extent that each of the following conditions shall
have been satisfied:
     (a) to the extent the Acquisition will be financed in whole or in part with
the proceeds of any Loan, the conditions to such Loan set forth herein shall
have been satisfied;
     (b) the Company shall have furnished to the Agent and Banks at least ten
(10) Business Days prior to the consummation of such Acquisition (1) such other
information and documents regarding the Acquisition that the Agent may
reasonably request, including, without limitation, executed counterparts of the
respective agreements, documents or instruments pursuant to which such
Acquisition is to be consummated, (2) pro forma financial statements of the
Company and its Subsidiaries after giving effect to the consummation of such
Acquisition, and (3) a certificate of a responsible officer of the Company
demonstrating on a pro forma basis compliance with the covenants set forth in
Section 10.6 hereof after giving effect to the consummation of such Acquisition;
     (c) the Company and its Subsidiaries (including any new Subsidiary) shall
execute and deliver the agreements, instruments and other documents required by
Section 10.14 and the Agent shall have received, for the benefit of the Secured
Parties, a collateral assignment of the seller’s representations, warranties and
indemnities to the Borrowers or any of their Subsidiaries under the acquisition
documents;
     (d) such Acquisition shall not be hostile and shall have been approved by
the board of directors (or other similar body) and/or the stockholders or other
equityholders of the Target;

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     (e) no Default or Event of Default shall then exist or would exist after
giving effect thereto;
     (f) the total consideration paid or payable (including without limitation,
any deferred payment) for all Acquisitions consummated during the term of this
Agreement shall not exceed $2,000,000 in the aggregate for all such
Acquisitions; and
     (g) the Target has EBITDA, subject to proforma adjustments acceptable to
the Agent, for the most recent four quarters prior to the acquisition date for
which financial statements are available, greater than zero [consider whether
BMR should be required]”
“ ‘Target’ means any other Person or business unit or asset group of any other
Person acquired or proposed to be acquired in an Acquisition.”
          (d) the term “$6,000,000” appearing in Section 2.1.3(b)(i) of the
Credit Agreement is hereby deleted in its entirety and the term “$-0-” is hereby
substituted therefor;
          (e) Schedule 2.1 to the Credit Agreement is hereby deleted in its
entirety and Schedule 2.1 attached hereto as Exhibit A is hereby substituted
therefor; and
          (f) Section 6.1.3 of the Credit Agreement is hereby deleted in its
entirety and the following language is hereby substituted therefor:
“ 6.1.3 All Reductions of the Revolving Commitment Amount. All reductions of the
Revolving Commitment Amount shall reduce the Revolving Commitments pro rata
among the Banks according to their respective Pro Rata Shares.”;
          (g) Section 10.6.3 of the Credit Agreement is hereby deleted in its
entirety and the following language is hereby substituted therefor;
“ 10.6.3 Reserved.”;
          (h) The following language is hereby added to Section 10.21 of the
Credit Agreement as new clause (h) thereof:
“ (h) Permitted Acquisitions;”;
          (i) the following proviso is hereby added to the last sentence of
Section 10.11 of the Credit Agreement:
“; provided, however, if and solely to the extent (i) such disposition or
dispositions are conducted pursuant to documentation in form and substance
reasonably satisfactory to the Agent, (ii) the proceeds of such disposition are
applied as a mandatory prepayment against the Loans in the manner required by
the terms of the Credit Agreement, (iii) no Default or Event of Default is then
existing or shall arise as a result thereof, and (iv) a certificate of a
responsible officer of the Company demonstrating on a pro forma basis compliance
with the covenants set forth in Section 10.6 hereof after giving effect to the

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consummation of such disposition or dispositions, the Company and its
Subsidiaries shall not be prohibited from disposing of its assets relating to
‘Arizona propane’ operations”;
          (j) Section 10.26 of the Credit Agreement is hereby deleted in its
entirety and the following language is hereby substituted therefor;
“ 10.26 Reserved.”;
          (k) Section 12.1.13 of the Credit Agreement is hereby deleted in its
entirety and the following language is hereby substituted therefor:
“ 12.1.13 Management. A period of ninety (90) consecutive days shall have
elapsed during which David A. Cerotzke is a not senior officer of the Company
actively involved with the management of the Company and its Subsidiaries, for
any reason, unless prior to the expiration of such period, a replacement officer
in respect of him satisfactory to the Agent in its sole discretion shall have
been appointed and employed by the Company.”;
          (l) references to Section 10.6.3 of the Credit Agreement and “Maximum
VaR and Open Positions” appearing in Exhibit B to the Credit Agreement are
hereby deleted in their respective entireties; and
          (m) as a result of the indefeasible repayment in full of Term Loan B
by the Company pursuant to the terms of the Credit Agreement, which the Company
hereby represents and warrants has occurred, all references in the Credit
Agreement and the other Loan Documents to “Term Loan B” are hereby deleted in
their respective entireties, all references to the “Term Loans” shall instead be
deemed references to “Term Loan A”; provided, however, if and to the extent all
or any portion of the payments made by the Company or any other Person to Agent
or any of the Banks are invalidated, declared to be fraudulent or preferential,
set aside and/or required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, state or federal law, common law or equitable cause,
then the amendments to the Credit Agreement and other Loan Documents contained
in this Section 2(f) shall be deemed rescinded and void ab initio.
     3. Ratification; No Defenses; Waiver.
          (a) Obligations. All references in the Loan Documents to the
“Obligations” or any other obligations, liabilities or indebtedness of the
Company or any other Loan Party owing from time to time and at any time to Agent
and the Banks shall be deemed to refer to, without limitation, the “Obligations”
of the Obligors under, pursuant to and as defined in the Credit Agreement, as
amended by this Amendment. All references in the Loan Documents to the “Credit
Agreement” shall be deemed to refer to the Credit Agreement, as amended by this
Amendment.
          (b) Ratification. In connection with the execution and delivery of
this Amendment, the Company and each Loan Party, as borrower, debtor, grantor,
mortgagor, pledgor, guarantor or assignor, or in any other similar capacities in
which such Person grants

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Liens or security interests in its Property or otherwise acts as an
accommodation party or guarantor, as the case may be, in any case under the Loan
Documents, hereby (i) acknowledges, ratifies and reaffirms all of its payment,
performance and observance obligations and liabilities, whether contingent or
otherwise, under each of such Loan Documents, to which it is a party, and (ii)
to the extent such Person granted Liens on or security interests in any of its
Property pursuant to any such Loan Documents as security for the obligations,
liabilities and indebtedness of such Person under or with respect to the Loan
Documents (the “Liabilities”), ratifies and reaffirms such grant of security and
confirms and agrees that such Liens and security interests hereafter secure all
of the Liabilities of such Person and the other Loan Parties, as applicable,
under the Loan Documents, as amended hereby, in each case including, without
limitation, all additional obligations, indebtedness and liabilities resulting
from this Amendment, and as if each reference in such Loan Documents, as amended
hereby, to the obligations, indebtedness and liabilities secured thereby are
construed hereafter to mean and refer to such obligations, indebtedness and
liabilities under Credit Agreement and the other Loan Documents, as amended
hereby. By executing this Amendment, the Company and each other Loan Party
hereby further ratifies, acknowledges, affirms and reconfirms that each Loan
Document, as amended hereby, constitutes a legal, valid and binding obligation
of such Person enforceable against such Person in accordance with its terms, and
that each such Loan Document, as amended hereby, is in full force and effect.
          (c) No Defenses. The Company and each other Loan Party hereby
represent and warrant to, and covenant with the Agent and the Banks that as of
the date hereof: (i) neither Company nor any other Loan Party has any defenses,
offsets or counterclaims of any kind or nature whatsoever against the Agent or
any Bank with respect to any of the loans or other financial accommodations made
under any of the Loan Documents or any of the Loan Documents themselves, or any
action previously taken or not taken by the Agent or any of the Banks with
respect thereto, and (ii) the Agent and the Banks have fully performed all
obligations to the Company and each other Loan Party which they may have had or
have on and of the date hereof.
          (d) Waiver. The Company and each other Loan Party, on its own behalf
and on behalf of its representatives, partners, agents, employees, servants,
officers, directors, shareholders, subsidiaries, affiliated and related
companies, successors and assigns (collectively, the “Obligor Group”), hereby
releases and forever discharges the Agent, the Banks, and their respective
officers, directors, subsidiaries, affiliated and related companies, agents,
servants, employees, shareholders, representatives, successors, assigns,
attorneys, accountants, assets and properties, as the case may be (collectively,
the “Bank Indemnified Group”), of and from all manner of actions, cause and
causes of action, suits, debts, sums of money, accounts, reckonings, bonds,
bills, specialities, covenants, contracts, controversies, agreements, promises,
obligations, liabilities, costs, expenses, losses, damages, judgments,
executions, claims and demands of whatsoever kind or nature, in law or in
equity, whether known or unknown, concealed or hidden, foreseen or unforeseen,
contingent or actual, liquidated or unliquidated, arising out of or relating to
the Loan Documents or any of the agreements, documents and instruments executed
and delivered in connection therewith or any related matter, cause or thing or
any transaction contemplated thereby, that any of the Obligor Group, jointly or
severally, has had, now has or hereafter can, shall or may have against the Bank
Indemnified Group, or any member thereof, directly or indirectly, whether known
or unknown, through the date hereof.

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     4. Conditions. The effectiveness of this Amendment is subject to the
following conditions precedent:
          (a) the Company, each other Loan Party and each Bank shall have
executed and delivered this Amendment and such other documents and instruments
as the Agent may reasonably require;
          (b) the Company shall have delivered, or caused to be delivered, to
Agent, a certificate of the corporate secretary or assistant corporate secretary
of each Loan Party pursuant to which such secretary or assistant secretary, on
behalf of such Loan Party certifies as to (x) the incumbency and signature of
the Persons executing this Amendment and any other Loan Documents delivered in
connection herewith on behalf of such Loan Party, (y) resolutions, which shall
be attached thereto, authorizing the execution, delivery and performance of this
Amendment and such Loan Documents by such Loan Party, and (z) the fact that the
articles of incorporation, articles of organization, bylaws, limited liability
company agreement or other organizational documents of such Loan Party have not
been amended, modified or supplemented since the date on which certified copies
thereof previously were delivered to Agent under the Loan Documents, and remain
in full force and effect;
          (c) the Company shall have delivered, or caused to be delivered, to
Agent, with respect to each Loan Party, a recent certificate of good standing
issued by the Secretary of State of such Loan Party’s jurisdiction of
incorporation;
          (d) the representations and warranties set forth in Section 5 of this
Amendment shall be true and correct;
          (e) the Agent shall have received written opinions of law of counsel
to the Company and its Subsidiaries, all in form and substance and covering such
subject matter as is satisfactory to Agent and its counsel and dated as of a
date satisfactory to Agent;
          (f) each Bank shall have received from the Company a fully-executed
Note which reflects, in a face principal amount equal to the sum of such Bank’s
Pro Rata Share of the Revolving Commitment Amount plus the principal amount of
such Bank’s Term Loan A;
          (g) the Agent shall have received from the Company a Solvency
Certificate, substantially in the form provided and approved by Agent, executed
by a Responsible Officer of the Company that, among other things, certifies the
Company and its Subsidiaries (each individually and together) are and, both
before and after giving effect to the terms of this Amendment will continue to
be, Solvent;
          (h) the Agent shall have received from the Company projected income
statements, balance sheets and cash flow statements for fiscal years 2007, 2008
and 2009, in each case prepared by the Company and giving pro forma effect to
the transactions contemplated by the terms of this Amendment and the use of
proceeds therefrom, all in form and substance satisfactory to the Bank

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          (i) the Agent shall have received from the Company for the account of
each Bank an upfront, fully-earned and non-refundable administrative fee in the
amount of $100,000; and
          (j) all proceedings taken in connection with the transactions
contemplated by this Amendment and all documents, instruments and other legal
matters incident thereto shall be reasonably satisfactory to the Agent and its
legal counsel.
     5. Representations and Warranties. To induce the Agent and the Banks to
enter into this Amendment, the Company and each other Loan Party hereby
represents and warrants to the Agent and the Banks that:
          (a) the Company and each other Loan Party is a corporation validly
existing and in good standing under the laws of its respective state of
incorporation; and the Company and each other Loan Party is duly qualified to do
business in each jurisdiction where, because of the nature of its activities or
properties, such qualification is required, except for such jurisdictions where
the failure to so qualify would not have a Material Adverse Effect;
          (b) the Company and each other Loan Party is duly authorized to
execute and deliver this Amendment, the Company is duly authorized to borrow
additional Loans provided for hereunder and each of the Company and each other
Loan Party is duly authorized to perform its obligations under each Loan
Document to which it is a party, as the same are amended hereby. The execution,
delivery and performance by the Company and each other Loan Party of this
Agreement, and the additional borrowings by the Company provided for hereunder,
do not and will not: (i) require any consent or approval of any governmental
agency or authority (other than any consent or approval which has been obtained
and is in full force and effect), (ii) conflict with: (A) any provision of law,
(B) the charter, bylaws or other organizational documents of the Company or any
other Loan Party or (C) any agreement, indenture, instrument or other document,
or any judgment, order or decree, which is binding upon the Company or any other
Loan Party or any of their respective properties or (iii) require, or result in,
the creation or imposition of any Lien on any asset of the Company or any other
Loan Party (other than Liens in favor of the Agent created pursuant to the
Collateral Documents).
          (c) (i) the execution, delivery and performance of this Amendment has
been duly authorized by all requisite corporate action on the part of the
Company and each such other Loan Party and this Amendment has been duly executed
and delivered by the Company and each other Loan Party and this Amendment and
the Credit Agreement, as amended hereby, constitute valid and binding
obligations of each of them, as applicable, enforceable in accordance with their
respective terms, (ii) no Default or Event of Default has occurred or is
continuing under the Credit Agreement or would result from the execution and
delivery of this Amendment, and (iii) each of the representations and warranties
set forth in Section 9 of the Credit Agreement, as amended hereby, is true and
correct in all material respects as of the date hereof, unless any such
representation or warranty is already qualified by materiality, in which case it
shall be true and correct in all respects.
     6. No Additional Term Loan Commitments. The Borrower and each other Loan
Party hereby acknowledges and agrees that nothing contained in this Amendment or
any other

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Loan Document creates any obligation or commitment by Agent or any Bank to loan
or otherwise advance any additional Term Loans to the Borrower, and the Borrower
and each other Loan Party further acknowledges and agrees that each of the Term
Loan A and the Term Loan B were fully funded on the Restatement Effective Date,
and that no commitment on the party of Agent or any Bank to fund any Term Loan
remains outstanding, whether evidenced by this Amendment, the Credit Agreement
or otherwise.
     7. Severability. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
     8. References. Any reference to the Credit Agreement contained in any
document, instrument or agreement executed in connection with the Credit
Agreement shall be deemed to be a reference to the Credit Agreement as modified
by this Amendment.
     9. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall constitute an original, but all of which taken
together shall be one and the same instrument. A counterpart of this Amendment
delivered by facsimile or other electronic means shall for all purposes be as
effective as delivery of an original counterpart.
     10. Costs. The Company agrees to pay on demand all reasonable costs and
expenses incurred by the Agent (including fees and expenses of counsel) incurred
in connection with the negotiation and preparation of this Amendment.
     11. Governing Law. The validity and interpretation of this Amendment and
the terms and conditions set forth herein, shall be governed by and construed in
accordance with the laws of the State of Illinois, without giving effect to any
provisions relating to conflict of laws that would call for the application of
the laws of another jurisdiction.
     12. Miscellaneous. This Amendment shall be deemed to be a Loan Document.
- Remainder of Page Intentionally Left Blank; Signature Page Follows -

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     Delivered at Chicago, Illinois, as of the day and year first above written.

                  THE AGENT AND BANK:       OTHER LOAN PARTIES:
 
                LASALLE BANK, NATIONAL       ENERGY WEST PROPANE, INC.,
ASSOCIATION, a national banking       a Montana corporation association, as the
Agent and as a Bank            
 
               
 
          By:   /s/ David A. Cerotzke
 
               
By:
  /s/ Meghan Schultz       Name:   David A. Cerotzke
 
               
Name:
  Meghan Schultz       Title:   President and CEO
Title:
  Assistant Vice President            
 
                COMPANY:            
 
                ENERGY WEST, INCORPORATED, a       ENERGY WEST RESOURCES, INC.,
Montana corporation       a Montana corporation
 
               
By:
  /s/ David A. Cerotzke       By:   /s/ David A. Cerotzke
 
               
Name:
  David A. Cerotzke       Name:   David A. Cerotzke
Title:
  President and CEO       Title:   President and CEO
 
                            ENERGY WEST DEVELOPMENT, INC.,             a Montana
corporation
 
               
 
          By:   /s/ David A. Cerotzke
 
               
 
          Name:   David A. Cerotzke
 
          Title:   President and CEO

Reaffirmation and Sixth Amendment

 

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Exhibit A to Reaffirmation and Sixth Amendment
BANKS AND PRO RATA SHARES

                              Pro Rata Share             of Revolving          
  Commitment   Amount of     Bank   Amount   Term Loan A   Pro Rata Share
LaSalle Bank National Association
  $ 20,000,000.00     $ 6,000,000.00       100.000000000 %
 
                       
TOTAL
  $ 20,000,000.00     $ 6,000,000.00       100.000000000 %