**Exhibit10.2**

** **

**FIRSTLOAN MODIFICATION AGREEMENT**

 

This First LoanModification Agreement (this “Loan Modification Agreement’) is entered into asof May 29, 2009 by and among (a) **SILICON VALLEY BANK**,a California corporation with its principal place of business at 3003 TasmanDrive, Santa Clara, California 95054 and with a loan production office locatedat One Newton Executive Park, Suite 200, 2221 Washington Street, Newton,Massachusetts 02462 (“**Bank**”), and (b) **ENERNOC, INC.**, a Delaware corporation (“**EnerNOC**”), and **ENERNOCSECURITIES CORPORATION**, a Massachusetts corporation (“**EnerNOC Securities**”) (hereinafter, EnerNOC and EnerNOCSecurities are jointly and severally, individually and collectively, referredto as “**Borrower**”).

 

**1.             DESCRIPTION OF EXISTING INDEBTEDNESS AND OBLIGATIONS.Among other indebtedness and obligations which may be owing by Borrower toBank, Borrower is indebted to Bank pursuant to a loan arrangement dated as of August 5,2008, evidenced by, among other documents, a certain Loan and SecurityAgreement dated as of August 5, 2008 between Borrower and Bank(collectively, the “**Loan Agreement”). Capitalized terms used but not otherwise defined herein shall have thesame meaning as in the Loan Agreement.

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**2.             DESCRIPTION OF COLLATERAL.  Repayment of the Obligations is secured bythe Collateral as described in the Loan Agreement. The Loan Agreement, togetherwith any other loan documents entered into by Borrower pursuant to whichcollateral security has been or will be granted to Bank, are referred to hereinas the “**Security Documents”; the Security Documents, together with all otherdocuments evidencing or securing the Obligations are referred to herein as the “ExistingLoan Documents”.

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**3.             DESCRIPTION OF CHANGE IN TERMS.**

** **

**Modifications to Loan Agreement**.

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**A. The Loan Agreement is hereby amended by deleting Section 2.5(c) thereofin its entirety and substituting the following text therefor:**

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“(c)         Letter of Credit Fee.  Bank’s customary fees and expenses for theissuance or renewal of Letters of Credit, including, without limitation, aLetter of Credit Fee of one and one-quarter of one percent (1.25%) per annum ofthe face amount of each Letter of Credit issued (other than the Letter ofCredit # SVBSF005826 issued by Bank in May, 2009, with respect to which aLetter of Credit Fee of one and three-quarters of one percent (1.75%) per annumof the face amount of such Letter of Credit shall apply), upon the issuance,each anniversary of the issuance, and the renewal of each Letter of Credit byBank;”

 

**B. The Loan Agreement is hereby amended by deleting Section 6.7(a) thereofin its entirety and substituting the following text therefor:**

** **

“(a)         Quick Ratio. A Quick Ratio of atleast (i) 1.85 to 1.0 for each month ending after the Effective Datethrough and including the month ending April 30, 2009, (ii) 1.40 to1.0 for the month ending May 31, 2009, and (iii)  1.85 to 1.0 for themonth ending June 30, 2009 and each month thereafter.”

 

**C.  The LoanAgreement is hereby amended by adding a new Section 6.7(c) theretoreading as follows:**

** **

“(c) At some pointduring the period commencing on May 31, 2009 and ending on June 10,2009, Borrower shall have unrestricted cash and/or Cash Equivalents on depositat Bank of at least $30,000,000.”

 

**D.  The LoanAgreement is hereby amended by deleting the definition of “Quick Assets” in Section 13.1thereofin its entirety and substituting the following text therefor:**

 

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““Quick Assets”is, on any date, the sum of (i) Borrower’s unrestricted cash, plus (ii) Borrower’snet accounts receivable, plus (iii) unbilled amounts on Borrower’s balancesheet that are contractually owing to Borrower from PJM and that are payablewithin the next twelve (12) months in an amount not to exceed the lesser of (A) ThirtyFive Million Dollars ($35,000,000.00) and (B) sixty percent (60%) ofBorrower’s unrestricted cash plus net accounts receivable,  plus (iv) marketable securities that areimmediately available for sale (but specifically excluding any auction ratesecurities other than an amount equal to fifty percent (50.0%) of the value ofthe Permitted Auction Rate Securities up to One Million Four Hundred FiftyThousand Dollars ($1,450,000.00)), determined according to GAAP.”

 

**E. The Loan Agreement is hereby amended by deleting Exhibit Bthereto in its entirety and substituting the Exhibit B in the formattached hereto as Schedule 1 therefor.**

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**4.             FEES. Borrower shall pay to Bank an amendment fee equal to Twenty ThousandDollars ($20,000.00) (the “Amendment Fee”), which shall be due on the datehereof and shall be deemed fully earned as of the date hereof; provided,however, that in the event that Borrower terminates the Letter of Credit**#SVBSF005826issued by Bank in May,2009 and replaces such Letter of Credit with another Letter of Credit (the “ReplacementLetter of Credit”) on or prior to June 30, 2009, Bank will credit theAmendment Fee against the Letter of Credit Fee payable upon the issuance of theReplacement  Letter of Credit.  In addition, Borrower shall also reimburseBank for all reasonable legal fees and expenses incurred in connection withthis amendment to the Existing Loan Documents.

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**5.             RATIFICATION OF PERFECTION CERTIFICATES. Borrowerhereby ratifies, confirms and reaffirms, all and singular, the terms anddisclosures contained in certain Perfection Certificate dated as of August 5,2008   and acknowledges, confirms andagrees the disclosures and information provided to Bank in the PerfectionCertificate has not changed, as of the date hereof.**

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**6.             CONSISTENT CHANGES.  The Existing Loan Documents are herebyamended wherever necessary to reflect the changes described above.**

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**7.             RATIFICATION OF LOAN DOCUMENTS.  Borrower hereby ratifies, confirms, andreaffirms all terms and conditions of all security or other collateral grantedto the Bank, and confirms that the indebtedness secured thereby includes,without limitation, the Obligations.**

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**8.             NO DEFENSES OF BORROWER.  Borrower hereby acknowledges and agrees thatBorrower has no offsets, defenses, claims, or counterclaims against Bank withrespect to the Obligations, or otherwise, and that if Borrower now has, or everdid have, any offsets, defenses, claims, or counterclaims against Bank, whetherknown or unknown, at law or in equity, all of them are hereby expressly WAIVEDand Borrower hereby RELEASES Bank from any liability thereunder.**

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**9.             CONTINUING VALIDITY.  Borrower understands and agrees that inmodifying the existing Obligations, Bank is relying upon Borrower’srepresentations, warranties, and agreements, as set forth in the Existing Loan Documents.  Except as expressly modified pursuant to thisLoan Modification Agreement, the terms of the Existing Loan Documents remainunchanged and in full force and effect. Bank’s agreement to modifications to the existing Obligations pursuantto this  Loan Modification Agreement inno way shall obligate Bank to make any future modifications to theObligations.  Nothing in this LoanModification Agreement shall constitute a satisfaction of the Obligations.  It is the intention of Bank and Borrower toretain as liable parties all makers of Existing Loan Documents, unless theparty is expressly released by Bank in writing. No maker will be released by virtue of this Loan Modification Agreement.**

 

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**10.           JURISDICTION/VENUE. Borrower accepts for itself and in connection with its properties,unconditionally, the exclusive jurisdiction of any state or federal court ofcompetent jurisdiction in the Commonwealth of Massachusetts in any action, suit, or proceeding of any kind againstit which arises out of or by reason of this Loan Modification Agreement;provided, however, that if for any reason Bank cannot avail itself of thecourts of the Commonwealth  ofMassachusetts, then venue shall lie in Santa Clara County, California.  NOTWITHSTANDING THE FOREGOING,  THE BANK SHALL HAVE THE RIGHT TO BRING ANYACTION OR PROCEEDING AGAINST THE BORROWER OR ITS PROPERTY IN THE COURTS OF ANYOTHER JURISDICTION WHICH THE BANK DEEMS NECESSARY OR APPROPRIATE IN ORDER TOREALIZE ON THE COLLATERAL OR TO OTHERWISE ENFORCE THE BANK’S RIGHTS AGAINST THEBORROWER OR ITS PROPERTY.**

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**11.           COUNTERSIGNATURE. This Loan Modification Agreement shall become effective only when itshall have been executed by Borrower and Bank.**

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[*signature page follows*]

 

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**IN WITNESS WHEREOF**, the parties hereto have caused this LoanModification Agreement to be executed as a sealed instrument under the laws ofthe Commonwealth of Massachusetts as of the date above written.

 
|                           |                  |
|--------------------------------|-----------------------|
| BORROWER:                      |                  |
|                           |                  |
| ENERNOC, INC.                  |                  |
|                           |                  |
| By:                            | /s/  Neal C. Isaacson |   |
| Name:                          | Neal  C. Isaacson     |   |
| Title:                         | CFO                   |   |
|                           |                  |
|                           |                  |
| ENERNOC SECURITIES CORPORATION |                  |
|                           |                  |
| By:                            | /s/  Neal C. Isaacson |   |
| Name:                          | Neal  C. Isaacson     |   |
| Title:                         | CFO                   |   |
|                           |                  |
|                           |                  |
| BANK:                          |                  |
|                           |                  |
| SILICON  VALLEY BANK           |                  |
|                           |                  |
| By:                            | /s/ Dave Rodriguez    |   |
| Name:                          | Dave Rodriguez        |   |
| Title:                         | SVP                   |   |

 

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**SCHEDULE 1**

 

**EXHIBIT B**

 

**COMPLIANCECERTIFICATE**

 
| TO:   | SILICON VALLEY  BANK                              | Date:  |   |
|-------|---------------------------------------------------|--------|--------|
| FROM: | ENERNOC, INC.  and ENERNOC SECURITIES CORPORATION |   |

 

Theundersigned authorized officer of ENERNOC, INC. and ENERNOC SECURITIESCORPORATION (individually and collectively, jointly and severally, “Borrower”)certifies that under the terms and conditions of the Loan and SecurityAgreement between Borrower and Bank (as amended, the “Agreement”), (1) Borroweris in complete compliance for the period ending                            withall required covenants except as noted below, (2) there are no Events ofDefault, (3) all representations and warranties in the Agreement are trueand correct in all material respects on this date except as noted below;provided, however, that such materiality qualifier shall not be applicable toany representations and warranties that already are qualified or modified bymateriality in the text thereof; and provided, further that thoserepresentations and warranties expressly referring to a specific date shall betrue, accurate and complete in all material respects as of such date, (4) Borrower,and each of its Subsidiaries, has timely filed all required tax returns andreports, and Borrower has timely paid all foreign, federal, state and local taxes,assessments, deposits and contributions owed by Borrower except as otherwisepermitted pursuant to the terms of Section 5.8 of the Agreement, and (5) noLiens have been levied or claims made against Borrower or any of itsSubsidiaries relating to unpaid employee payroll or benefits of which Borrowerhas not previously provided written notification to Bank.  Attached are the required documentssupporting the certification.  Theundersigned certifies that these are prepared in accordance with GAAP consistentlyapplied from one period to the next except as explained in an accompanyingletter or footnotes.  The undersignedacknowledges that no borrowings may be requested at any time or date ofdetermination that Borrower is not in compliance with any of the terms of theAgreement, and that compliance is determined not just at the date thiscertificate is delivered.  Capitalizedterms used but not otherwise defined herein shall have the meanings given themin the Agreement.

 

**Please indicate compliance statusby circling Yes/No under “Complies” column.**

 
| **Reporting  Covenant**                                                                                                                        | ** ** | **Required**                        | ** **                                                                            | **Complies**            |
|------------------------------------------------------------------------------------------------------------------------------------------------|------------|-------------------------------------|---------------------------------------------------------------------------------------|-------------------------|
| ** **                                                                                                                                     | ** ** | ** **                          | ** **                                                                            | ** **              |
| Quarterly Financial  Statements on Form 10-Q                                                                                              |       | Quarterly within 45  days           |                                                                                  | Yes   No |
| Monthly Compliance  Certificate                                                                                                                |       | Monthly within 45 days              |                                                                                  | Yes   No |
| Annual financial statements  (CPA Audited) on 10-Ktogether with an unqualified audited opinion                                                 |       | FYE within 90 days                  |                                                                                  | Yes   No |
| 8-K, 10-Q and 10-K  filings                                                                                                                    |       | Within 5 days after SEC  filing     |                                                                                  | Yes   No |
| A/R and A/P agings and  statement of account balances                                                                                          |       | As requested by Bank                |                                                                                  | Yes   No |
| Board projections                                                                                                                              |       | 60 days after FYE                   |                                                                                  | Yes   No |
|                                                                                                                                           |       |                                |                                                                                  |                    |
| **Contracts entered into during  month by Borrower restricting grant of security interest to Bank pursuant to  Section 5.2 of the Agreement:** |
|                                                                                                                                           |       |                                |                                                                                  |                    |
| **Financial Covenant**                                                                                                                         | ** ** | **Required**                        | ** **                                                                            | **Actual**              | ** ** | **Complies** |
|                                                                                                                                           | ** ** | ** **                          | ** **                                                                            | ** **              | ** ** | ** ** |
| Quick  Ratio (monthly)                                                                                                                         |       | 1.85 : 1.0 (1.40 : 1.0  at 5/31/09) |                                                                                  | : 1.0                   |   | Yes  No |
| Tangible  Net Worth (quarterly)                                                                                                                |       | $                                   |               * |                    | $ |   | Yes   No |
|                                                                                                                                                |            |                                     |                                                                                       |                         |  |  |  |  |  |

 

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*As set forth in Section 6.7(b) of the Loanand Security Agreement.

 

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Thefollowing financial covenant analyses and information set forth in Schedule 1attached hereto are true and accurate as of the date of this Certificate.

 

Thefollowing are the exceptions with respect to the certification above:  (If no exceptions exist, state “No exceptionsto note.”)

 

 
| ENERNOC,  INC.                  | **BANK  USE ONLY**                                                                                           |
|---------------------------------|--------------------------------------------------------------------------------------------------------------|
| ENERNOC  SECURITIES CORPORATION | ** **                                                                                                   |
|                            | Received  by:                                                                                                | ** ** |
| By:                             |                                                                                                         |   | AUTHORIZED SIGNER |
| Name:                           |                                                                                                         |   | Date: | ** ** |
| Title:                          |                                                                                                         |   | Verified: | ** ** |
|                            | AUTHORIZED SIGNER                                                                                            |
|                            | Date:                                                                                                        | ** ** |
|                            | Compliance  Status:         Yes     No |
|                                 |                                                                                                              |  |  |  |  |  |

 

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**Schedule 1 to ComplianceCertificate**

**Financial Covenants of Borrower**

 
| Dated: |   |   |
|--------|--------|--------|

 

In the event of a conflict between thisSchedule and the Loan Agreement, the terms of the Loan Agreement shall control.

 

I.                                         **Quick Ratio** (Section 6.7(a))

 

Required:                                             1.85 : 1.00 (1.40 : 1.0 at 5/31/09)

 

Actual:                          :1.00

 
| A.     | Aggregate  value of the unrestricted cash of Borrower                                                                                                                                                                                                                                                                                                                                                                                 |   | $      |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |
| B.     | Aggregate  value of the net accounts receivable of Borrower plus unbilled amounts on  Borrower’s balance sheet that are contractually owing to Borrower from PJM  and that are payable within the next twelve (12) months in an amount not to  exceed the lesser of (i) Thirty Five Million Dollars ($35,000,000.00) and  (ii) sixty percent (60%) of Borrower’s unrestricted cash plus net accounts  receivable. |   | $      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |
| C.     | Marketable  securities that are immediately available for sale (but specifically  excluding any auction rate securities other than an amount equal to fifty  percent (50.0%) of the value of the Permitted Auction Rate Securities up to  One Million Four Hundred Fifty Thousand Dollars ($1,450,000.00))                                                                                                                            |   | $      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |
| D.     | Quick  Assets (the sum of lines A, B and C)                                                                                                                                                                                                                                                                                                                                                                                           |   | $      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |
| E.     | Aggregate  value of obligations and liabilities of Borrower to Bank, including Letters  of Credit                                                                                                                                                                                                                                                                                                                                     |   | $      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |
| F.     | Quick  Ratio (line D divided by line E)                                                                                                                                                                                                                                                                                                                                                                                               |   |   |

 

Is line F equal to or greater than 1.85 :1.00 (1.40 : 1.0 at5/31/09)?

 

o  No,not in compliance                                                                                     o  Yes,in compliance

 

II.                                     **TANGIBLE NET WORTH** (Section 6.7(b))

 

Required:                                             $                                  (see Section 6.7(b))

 

Actual:                                                         $

 

Is Tangible Net Worth at least$                                    (see Section 6.7(b))?

 

o  No,not in compliance                                                                                     o  Yes,in compliance

 

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