EX-10.6



 





Exhibit 10.6




FIRST AMENDMENT TO CREDIT AGREEMENT




     THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “First Amendment”), dated as of
January 17, 2008, among POWERSECURE INTERNATIONAL, INC., a Delaware corporation (the
“Borrower”), the lenders party to the Credit Agreement defined below (the
“Lenders”), and CITIBANK, N.A., as Administrative Agent.



BACKGROUND




     A. The Borrower, the Lenders and the Administrative Agent are parties to that certain Credit
Agreement, dated as of August 23, 2007 (the “Credit Agreement”; the terms defined in the
Credit Agreement and not otherwise defined herein shall be used herein as defined in the Credit
Agreement).



     B. The Borrower, the Lenders and the Administrative Agent desire to make certain amendments to
the Credit Agreement.



     NOW, THEREFORE, in consideration of the covenants, conditions and agreements hereafter set
forth, and for other good and valuable consideration, the receipt and adequacy of which are all
hereby acknowledged, the parties hereto covenant and agree as follows:



     1. AMENDMENTS.



     (a) Section 1.01 of the Credit Agreement is hereby amended by adding the following
defined terms thereto in proper alphabetical order:




     “Term Credit Agreement” means that certain Term Credit Agreement, dated as of
January 17, 2008, among the Borrower, Citibank, as administrative agent, and the lenders
party thereto.




     “Term Credit Agreement Collateral Documents” means the Collateral Documents as
defined in the Term Credit Agreement.




     “Term Credit Agreement Obligations” has the meaning specified in
Section 10.20.



     (b) Section 1.01 of the Credit Agreement is hereby amended by amending the definition
of “Interest Payment Date” to read as follows:




     “Interest Payment Date” means, (a) as to any Loan other than a Alternate Base
Rate Loan, the last day of each Interest Period applicable to such Loan and the Revolving
Maturity Date or Term Maturity Date, as applicable; provided, however, that
if any Interest Period for a Eurodollar Rate Loan exceeds three months, the respective dates
that fall every three months after the beginning of such Interest Period shall also be
Interest Payment Dates; and (b) as to any Alternate Base Rate Loan, the last Business Day of
each March, June, September and December and the Revolving Maturity Date or Term Maturity
Date, as applicable.




     (c) Section 6.01(b) of the Credit Agreement is hereby amended to read as follows:



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     (b) as soon as available, but in any event within 45 days after the end of the first
three Fiscal Quarters of each Fiscal Year (and within 90 days after the end of the fourth
Fiscal Quarter of each Fiscal Year) of the Borrower (commencing with the Fiscal Quarter
ended June 30, 2007), a consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as at the end of such Fiscal Quarter, and the related consolidated and
consolidating statements of income or operations, and consolidated cash flows for such
Fiscal Quarter (other than consolidated cash flows, which shall be on a year-to-date basis)
and for the portion of the Borrower’s Fiscal Year then ended, setting forth, to the extent
the information is available to the Borrower, in each case in comparative form the figures
for the corresponding Fiscal Quarter of the previous Fiscal Year and the corresponding
portion of the previous Fiscal Year, all in reasonable detail, such consolidated statements
to be certified by a Responsible Officer of the Borrower as fairly presenting the financial
condition, results of operations and cash flows of the Borrower and its Subsidiaries in
accordance with GAAP, subject only to normal year-end audit adjustments and the absence of
footnotes and such consolidating statements to be certified by a Responsible Officer of the
Borrower to the effect that such statements are fairly stated in all material respects when
considered in relation to the consolidated financial statements of the Borrower and its
Subsidiaries;



     (d) Section 7.01 of the Credit Agreement is hereby amended by (i) deleting “and” after
the end of clause (p) thereof, (ii) deleting “.” at the end of clause (q) thereof and adding “;
and” in lieu thereof, and (iii) adding the following new clause (r) at the end thereof:




     (r) Liens granted pursuant to the Term Credit Agreement Collateral Documents.



     (e) Section 7.03 of the Credit Agreement is hereby amended by (i) deleting “and” after
the end of clause (g) thereof, (ii) deleting “.” at the end of clause (h) thereof and inserting “;
and” in lieu thereof, and (iii) adding the following new clause (i) at the end thereof:




     (i) Indebtedness in respect of the Term Credit Agreement and any other Loan Documents
(as defined in the Term Credit Agreement).



     (f) Section 8.01 of the Credit Agreement is hereby amended by (i) deleting “or” after
the end of clause (j) thereof, (ii) deleting “.” after the end of clause (k) thereof and inserting
”; or” in lieu thereof, and (iii) adding the following new clause (l) at the end thereof:




     (l) Term Credit Agreement. An Event of Default (as defined in the Term Credit
Agreement) shall occur.




(g) The initial paragraph of Section 8.03 is hereby amended to read as follows:




Section 8.03. Application of Funds. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become due and payable and the
L/C Obligations have automatically been required to be Cash Collateralized as set forth in
the proviso to Section 8.02), any amounts received on account of the Obligations
shall be applied by the Administrative Agent in the following order, subject to
Section 10.20:



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     (h) Article X of the Credit Agreement is hereby amended by adding a new
Section 10.20 thereto to read as follows:




     Section 10.20. Term Credit Agreement. The parties hereto acknowledge that the Liens
now or hereafter granted pursuant to the Collateral Documents and the Secured Obligations
with respect to this Agreement and the other Loan Documents and the Liens (as defined in the
Term Credit Agreement) and the Secured Obligations (as defined in he Term Credit Agreement)
and defined herein as the “Term Credit Agreement Obligations” are pari passu and of
equal ranking, and notwithstanding anything herein (including Section 8.03) or in
the Term Credit Agreement to the contrary, and proceeds received from the Collateral and the
Guaranties (as defined in each of this Agreement and the Term Credit Agreement) shall be
applied to the Secured Obligations and the Term Credit Agreement Obligations pro rata in
proportion to the respective outstanding amounts of the Secured Obligations and the Term
Credit Agreement Obligations.



     2. REPRESENTATIONS AND WARRANTIES TRUE; NO EVENT OF DEFAULT. By its execution and
delivery hereof, the Borrower represents and warrants that, as of the date hereof and after giving
effect to the amendments set forth in the foregoing Section 1:



     (a) the representations and warranties contained in the Credit Agreement and the other Loan
Documents are true and correct on and as of the date hereof as made on and as of such date, except
to the extent that such representations and warranties specifically refer to an earlier date, in
which case they are true and correct as of such earlier date;



     (b) no event has occurred and is continuing which constitutes a Default or an Event of
Default;



     (c) the Borrower has full power and authority to execute and deliver this First Amendment, and
this First Amendment and the Credit Agreement, as amended hereby, constitute the legal, valid and
binding obligations of the Borrower, enforceable against the Borrower in accordance with their
respective terms, except as enforceability may be limited by applicable Debtor Relief Laws and by
general principles of equity (regardless of whether enforcement is sought in a proceeding in equity
or at law) and subject to an implied covenant of good faith and fair dealing and except as rights
to indemnity may be limited by federal or state securities laws;



     (d) no authorization, approval, consent, or other action by, notice to, or filing with, any
governmental authority or other Person (not already obtained), is required for the execution,
delivery or performance by (i) the Borrower of this First Amendment or (ii) the acknowledgment of
this First Amendment by any Guarantor, other than those already obtained or made; and



     (e) all of the conditions precedent to the advance of the term loan under the Term Credit
Agreement shall have been satisfied.



     3. CONDITIONS OF EFFECTIVENESS. This First Amendment shall be effective as of
January 17, 2008 subject to the following:



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     (a) the representations and warranties set forth in Section 2 of this First Amendment shall be
true and correct;



     (b) the Administrative Agent shall have received a certified resolution of the board of
directors of the Borrower authorizing (i) the execution and delivery of this First Amendment and
(ii) the performance of the Credit Agreement, as amended by this First Amendment.



     (c) the Administrative Agent shall have received counterparts of this First Amendment executed
by the Lenders; and



     (d) the Administrative Agent shall have received counterparts of this First Amendment executed
by the Borrower and acknowledged by each Guarantor.



     4. GUARANTOR’S ACKNOWLEDGMENT. By signing below, each Guarantor (i) acknowledges,
consents and agrees to the execution, delivery and performance by the Borrower of this First
Amendment, (ii) acknowledges and agrees that its obligations in respect of its Guaranty are not
released, diminished, waived, modified, impaired or affected in any manner by this First Amendment,
or any of the provisions contemplated herein, (iii) ratifies and confirms its obligations under its
Guaranty and (iv) acknowledges and agrees that it has no claim or offsets against, or defenses or
counterclaims to, its Guaranty.




5. REFERENCE TO THE CREDIT AGREEMENT.



     (a) Upon and during the effectiveness of this First Amendment, each reference in the Credit
Agreement to “this Agreement”, “hereunder”, or words of like import shall mean and be a reference
to the Credit Agreement, as affected by this First Amendment.



     (b) Except as expressly set forth herein, this First Amendment shall not by implication or
otherwise limit, impair, constitute a waiver of, or otherwise affect the rights or remedies of the
Borrower or the Administrative Agent or the Lender under the Credit Agreement or any of the other
Loan Documents, and shall not alter, modify, amend, or in any way affect the terms, conditions,
obligations, covenants, or agreements contained in the Credit Agreement or the other Loan
Documents, all of which are hereby ratified and affirmed in all respects and shall continue in full
force and effect.



     6. COSTS AND EXPENSES. The Borrower shall be obligated to pay or reimburse the
Administrative Agent for all reasonable costs and expenses incurred by the Administrative Agent in
connection with the preparation, reproduction, execution and delivery of this First Amendment and
the other instruments and documents to be delivered hereunder.



     7. EXECUTION IN COUNTERPARTS. This First Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which when taken together shall
constitute but one and the same instrument. For purposes of this First Amendment, a counterpart
hereof (or signature page thereto) signed and transmitted by any Person party hereto to the
Administrative Agent (or its counsel) by facsimile machine, telecopier or electronic mail is to be
treated as an original. The signature of such Person thereon, for purposes hereof, is to be
considered as an original signature, and the counterpart (or signature



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page thereto) so transmitted is to be considered to have the same binding effect as an
original signature on an original document.




     8. GOVERNING LAW; BINDING EFFECT. This First Amendment shall be governed by and
construed in accordance with the laws of the State of New York applicable to agreements made and to
be performed entirely within such state (provided that each party shall retain all rights arising
under federal law), and shall be binding upon the parties hereto and their respective successors
and assigns.



     9. HEADINGS. Section headings in this First Amendment are included herein for
convenience of reference only and shall not constitute a part of this First Amendment for any other
purpose.



     10. ENTIRE AGREEMENT. THE CREDIT AGREEMENT, AS AMENDED BY THIS FIRST AMENDMENT, AND
THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AS TO THE SUBJECT MATTER
THEREIN AND HEREIN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS BETWEEN THE PARTIES.








REMAINDER OF PAGE LEFT INTENTIONALLY BLANK








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     IN WITNESS WHEREOF, the parties hereto have executed this First Amendment as of the date first
above written.



	 	 	 	 	 
	 	POWERSECURE INTERNATIONAL, INC.

 	 
	 	By:   	/s/ Christopher T. Hutter 	 
	 	 	Christopher T. Hutter 	 
	 	 	Chief Financial Officer 	 



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	 	CITIBANK, N.A., as Administrative Agent and Lender

 
	 	By:   	/s/ Gary D. Pitcock	 
	 	 	Gary D. Pitcock	 
	 	 	Vice President	 



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ACKNOWLEDGED AND AGREED:




POWERSECURE, INC.

POWERSERVICES, INC.

ENERGYLITE, INC.

UTILITYENGINEERING, INC.

UTILITYDESIGN, INC.

MARCUM GAS TRANSMISSION, INC.

REID’S TRAILER, INC.

EFFICIENTLIGHTS, LLC

SOUTHERN FLOW COMPANIES, INC.

METRETEK, INCORPORATED




	 	 	 	 	 
	 	By:  	/s/
Christopher T. Hutter 	 
	 	 	Christopher T. Hutter 	 
	 	 	Chief Financial Officer for all 	 







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