EX-10.1






AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT




THIS AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this “Agreement”) is made and
entered into as of August 4, 2005, by and among THE LACLEDE GROUP, INC., a Missouri corporation
(“Borrower”), and U. S. BANK NATIONAL ASSOCIATION, a national banking association
(“Lender”); and has reference to the following facts and circumstances:



A. Borrower and Lender previously entered into the Revolving Credit Agreement dated as of June
13, 2002, as amended by the First Amendment to Revolving Credit Agreement dated as of April 16,
2003, the Second Amendment to Revolving Credit Agreement and Amendment to Revolving Note dated as
of June 12, 2003, the Third Amendment to Revolving Credit Agreement dated as of June 11, 2004, and
the Fourth Amendment to Revolving Credit Agreement dated as of June 30, 2005 (the “Original
Loan Agreement”).



B. Borrower and Lender desire to amend and restate the Original Loan Agreement to provide a
three year revolving credit facility in an increased principal amount of up to $40,000,000 upon,
and subject to, the terms, provisions and conditions hereinafter set forth.



NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower and Lender
hereby mutually covenant and agree as follows:



SECTION 1. DEFINITIONS.



1.01 Definitions. In addition to the terms defined elsewhere in this Agreement or in
any Exhibit or Schedule hereto, when used in this Agreement, the following terms shall have the
following meanings (such meanings shall be equally applicable to the singular and plural forms of
the terms used, as the context requires):



Acquisition shall mean any transaction or series of related transactions, consummated
on or after the date of this Agreement, by which Borrower or any Subsidiary directly or indirectly
(a) acquires all or substantially all of the assets comprising one or more business units of any
other Person at a purchase price of $5,000,000 or more, whether through purchase of assets, merger
or otherwise or (b) acquires (in one transaction or as the most recent transaction in a series of
transactions) at least (i) a majority (in number of votes) of the stock and/or other securities of
a corporation having ordinary voting power for the election of directors (other than stock and/or
other securities having such power only by reason of the happening of a contingency), (ii) a
majority (by percentage of voting power) of the outstanding partnership interests of a partnership,
(iii) a majority (by percentage of voting power) of the outstanding membership interests of a
limited liability company or (iv) a majority of the ownership interests in any organization or
entity other than a corporation, partnership or limited liability company.



Adjusted Prime Rate shall mean the Prime Rate plus the Applicable Prime
Margin. The Adjusted Prime Rate shall be adjusted automatically on and as of the effective date of
any change in the Prime Rate and/or the Applicable Prime Margin.



Applicable Commitment Fee Rate, Applicable LIBOR Margin, and Applicable
Prime Margin shall mean the annual rate shown in the applicable column below based on the
Applicable Rating Level:



	 	 	 	 	 	 	 	 	 	 	 	 	 
	If the	 	Applicable	 	 	 	 
	Applicable Rating	 	Commitment Fee Rate	 	Applicable LIBOR	 	Applicable Prime
	Level is, then	 	is	 	Margin is	 	Margin is
	3 A/A2

	 	 	0.090	%	 	 	0.350	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	3 A-/A3

	 	 	0.100	%	 	 	0.450	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	3 BBB+/Baa1

	 	 	0.125	%	 	 	0.575	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	3 BBB/Baa2

	 	 	0.150	%	 	 	0.700	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	3 BBB-/Baa3

	 	 	0.175	%	 	 	0.825	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	< BBB-/Baa3

	 	 	0.200	%	 	 	0.950	%	 	 	0	%






Applicable Rating Level shall mean, at any time, the two (2) highest credit
ratings of the three (3) credit ratings then assigned by Fitch, Moody’s and S&P of Borrower’s
long-term senior unsecured debt, or if there are no such applicable credit ratings of Borrower’s
long-term senior unsecured debt, then Applicable Rating Level shall mean one rating level below the
then applicable credit ratings by Fitch, Moody’s and S&P of Borrower’s long-term senior secured
debt. Notwithstanding the foregoing, (i) if there is a difference of one level in such credit
ratings, then the higher of such credit ratings shall be used to determine the Applicable Rating
Level, and (ii) if there is a difference of more than one level in such credit ratings, then the
rating one level higher than the lower of such credit ratings shall be used to determine the
Applicable Rating Level. Any change in the Applicable LIBOR Margin and the Applicable Prime Margin
shall be effective on the date on which Fitch, Moody’s and/or S&P, as the case may be, announces
any change in any rating that results in a change in the Applicable Rating Level.



Borrower’s Obligations shall mean any and all present and future indebtedness
(principal, interest, fees, collection costs and expenses, attorneys’ fees and other amounts),
liabilities and obligations (including, without limitation, indemnity obligations) of Borrower to
Lender evidenced by or arising under or in respect of this Agreement, the Note and/or any of the
other Transaction Documents.



Business Day shall mean any day except a Saturday, Sunday or legal holiday observed by
Lender.



Consolidated Capitalization shall mean, as of the date of any determination thereof,
the sum of Consolidated Debt as of such date, plus Consolidated Net Worth as of such date,
all determined on a consolidated basis and in accordance with GAAP.



Consolidated Capitalization Ratio shall mean, as of the date of any determination
thereof, the ratio (expressed as a percentage) of Consolidated Debt as of such date to Consolidated
Capitalization as of such date, all determined on a consolidated basis and in accordance with GAAP;
provided, that for purposes of calculating the Consolidated Capitalization Ratio, only Fifty
Percent (50%) of the principal amount of the subordinated Debt issued by Borrower to Laclede
Capital Trust I shall be included in Consolidated Debt.



Consolidated Debt shall mean, as of the date of any determination thereof, all Debt of
Borrower and its Subsidiaries as of such date, determined on a consolidated basis and in accordance
with GAAP.



Consolidated Net Worth shall mean, as of the date of any determination thereof, the
amount of the capital stock accounts (net of treasury stock, at cost) of Borrower and its
Subsidiaries as of such date plus (or minus in the case of a deficit) the surplus and retained
earnings of Borrower and its Subsidiaries as of such date, all determined on a consolidated basis
and in accordance with GAAP.



Debt shall mean, as of the date of determination thereof, the sum of (a) all
indebtedness, liabilities and/or obligations of Borrower or any of its Subsidiaries for borrowed
money or that have been incurred in connection with the purchase or other acquisition of property
(other than unsecured trade accounts payable incurred in the ordinary course of business),
plus (b) all leases of property, whether real and/or personal, by Borrower or any of its
Subsidiaries as lessee(s), that in accordance with GAAP are required to be capitalized on the
balance sheet of such entity, plus (c) the aggregate undrawn face amount of all Letters of
Credit and/or surety bonds issued for the account and/or upon the application of Borrower or any of
its Subsidiaries together with all unreimbursed drawings with respect thereto, plus (d) all
guarantees by Borrower or any of its Subsidiaries of Debt of other Persons (but not including any
guarantees of Debt of Borrower or any of its Subsidiaries).



Default shall mean any event or condition the occurrence of that would, with the lapse
of time or the giving of notice or both, become an Event of Default.



Event of Default shall have the meaning ascribed thereto in Section 6.



Fitch shall mean Fitch Ratings, Ltd.



GAAP shall mean, at any time, generally accepted accounting principles at such time in
the United States.



Guaranty shall mean each Guaranty dated as of the dated hereof, executed by SM&P and
Laclede Energy respectively in favor of Lender; and Guaranties shall mean both of them.



Indemnified Liabilities shall have the meaning ascribed thereto in section 7.04.



Interest Period shall mean with respect to each LIBOR Loan: (a) initially, the period
commencing on the date selected by Borrower in the applicable Interest Rate Selection Notice and
ending one (1), two (2), three (3) or six (6) months thereafter as Borrower may elect in the
applicable Interest Rate Selection Notice; and (b) thereafter, each period commencing on the last
day of the immediately preceding Interest Period applicable to such LIBOR Loan and ending one (1),
two (2), three (3) or six (6) months, as Borrower may elect in the applicable Interest Rate
Selection Notice; provided that: (c) no Interest Period for a LIBOR Loan shall extend beyond a
date on which Borrower is required to make a scheduled payment of principal on the Loan unless the
sum of (A) the aggregate principal amount of outstanding Prime Loans plus (B) the aggregate
principal amount of outstanding LIBOR Loans with Interest Periods expiring on or before the date
such scheduled principal payment is due equals or exceeds the aggregate principal amount to be paid
on the Loan on such principal payment date; (d) subject to clauses (e) and (f) below, any Interest
Period that would otherwise end on a day that is not a New York Business Day shall be extended to
the next succeeding New York Business Day unless such New York Business Day falls in another
calendar month, in which case such Interest Period shall end on the immediately preceding New York
Business Day; (e) subject to clause (f) below, any Interest Period that begins on the last New York
Business Day of a calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last New York Business
Day of a calendar month; and no Interest Period may extend beyond the maturity date of the Loan.




Interest Rate Selection Notice shall have the meaning ascribed thereto in section
2.02(a).



Investment shall mean any investment (including, without limitation, any loan or
advance) of Borrower or any Subsidiary in or to any Person, whether payment therefor is made in
cash or capital stock or other equity interests of Borrower or any Subsidiary, and whether such
investment is by acquisition of stock or other equity interests or Indebtedness, or by loan,
advance, transfer of property out of the ordinary course of business, capital contribution, equity
or profit sharing interest, extension of credit on terms other than those normal in the ordinary
course of business or otherwise.



Laclede Energy shall mean Laclede Energy Resources, Inc., a Missouri corporation, and
a Subsidiary of Borrower.




Lender’s Revolving Credit Commitment shall mean the sum of Forty Million Dollars
($40,000,000).




Letter of Credit and Letters of Credit shall have the meanings ascribed to
these terms in Section 2.18(a).



Letter of Credit Application shall mean Lender’s standard form of application and
agreement for irrevocable standby letter of credit, or Lender’s standard form of application and
agreement for irrevocable commercial letter of credit, as the case may be, in either case executed
by Borrower, or a Subsidiary of Borrower, as applicant and account party, and delivered to Lender
pursuant to Section 2.18(a), as the same may from time to time be amended, modified, extended,
renewed or restated.



LGC shall mean Laclede Gas Company, a Missouri corporation, and a Subsidiary of
Borrower.



LIBOR Base Rate shall mean, with respect to the applicable Interest Period, (a) the
LIBOR Index Rate for such Interest Period, if such rate is available or (b) if the LIBOR Index Rate
is not available, the average (rounded upward, if necessary, to the next higher 1/10,000 of 1%) of
the respective annual rates of interest at which deposits in U.S. Dollars are offered to Lender in
the London interbank market by two (2) Eurodollar dealers of recognized standing, selected by
Lender in its sole discretion, at or about 11:00 a.m. (London time) on the date two (2) New York
Business Days before the first day of such Interest Period, for delivery on the first day of the
applicable Interest Period for a number of days comparable to the number of days in such Interest
Period and in an amount approximately equal to the principal amount of the LIBOR Loan to which such
Interest Period is to apply.



LIBOR Index Rate shall mean, with respect to the applicable Interest Period, an annual
rate (rounded upwards, if necessary, to the next higher 1/10,000 of 1%) equal to the British
Bankers’ Association interest settlement rates for U.S. Dollar deposits for such Interest Period as
of 11:00 a.m. (London time) on the day two (2) New York Business Days before the first day of such
Interest Period as published by Bloomberg Financial Services, Dow Jones Market Service, Telerate,
Reuters or any other service from time to time used by Lender.



LIBOR Loan shall mean any portion of the Loan bearing interest based on the LIBOR
Rate.



LIBOR Rate shall mean (a) the quotient of the (i) LIBOR Base Rate divided by (ii) one
minus the applicable LIBOR Reserve Percentage plus (b) the Applicable LIBOR Margin. The
LIBOR Rate shall be adjusted automatically on and as of the effective date of any change in the
LIBOR Reserve Percentage and/or the Applicable LIBOR Margin.



LIBOR Reserve Percentage shall mean for any day that percentage (expressed as a
decimal) which is in effect on such day, as prescribed by The Board of Governors of the Federal
Reserve System (or any successor), for determining the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special or marginal reserves) with respect
to “Eurocurrency liabilities” as defined in Regulation D or with respect to any other category of
liabilities which includes deposits by reference to which the interest rate on LIBOR Loans is
determined, whether or not Lender has any Eurocurrency liabilities subject to such reserve
requirement at such time. LIBOR Loans shall be deemed to constitute Eurocurrency liabilities and as
such shall be deemed subject to reserve requirements without the benefit of any credits for
proration, exceptions or offsets which may be available from time to time to Lender. The LIBOR
Rate shall be adjusted automatically on and as of the effective date of any change in the LIBOR
Reserve Percentage.



Loan and Loans shall have the meaning ascribed thereto in Section 2.01(a).



Material Adverse Effect shall mean (a) a material adverse effect on the properties,
assets, liabilities, business, operations, income or condition (financial or otherwise) of Borrower
and its Subsidiaries taken as a whole, (b) material impairment of Borrower’s ability to perform any
of its obligations under this Agreement, the Note or any of the other Transaction Documents or (c)
material impairment of the enforceability of the rights of, or benefits available to, Lender under
this Agreement, the Note or any of the other Transaction Documents.



Moody’s shall mean Moody’s Investors Service, Inc.



New York Business Day means any day (other than a Saturday or Sunday) on which
commercial banks are open for business in New York, New York.



Note shall have the meaning ascribed thereto in Section 2.03(a).



Notice of Borrowing shall have the meaning ascribed thereto in Section 2.02(a).



Other Taxes shall have the meaning ascribed thereto in Section 2.20(b).



Permitted Investment shall mean any Investment or Acquisition, or any expenditure or
any incurrence of any liability to make any expenditure for an Investment or Acquisition, other
than (a) any Investment or Acquisition the result of which would be to change substantially the
nature of the business engaged in by Borrower and its Subsidiaries, (b) any Investment that is in
the nature of a hostile or contested Acquisition, and (c) any Investment that would result in a
Default or Event of Default; provided, that it is expressly agreed that all Investments under
Borrower’s or Subsidiaries’ gas supply risk management programs are Permitted Investments.



Person shall mean any individual, sole proprietorship, partnership, joint venture,
limited liability company, trust, unincorporated organization, association, corporation,
institution, entity or government (whether national, Federal, state, county, city, municipal or
otherwise, including, without limitation, any instrumentality, division, agency, body or department
thereof).



Prime Loan shall mean any portion of the Loan bearing interest based on the Adjusted
Prime Rate.



Prime Rate shall mean the interest rate announced from time to time by Lender as its
“prime rate” (which rate shall fluctuate as and when said prime rate shall change). Borrower
acknowledges that such “prime rate” is a reference rate and does not necessarily represent the
lowest or best rate offered by Lender to its customers.



Regulation D shall mean Regulation D of the Board of Governors of the Federal Reserve
System, as amended.



Regulatory Change shall have the meaning ascribed thereto in Section 2.10.



Revolving Credit Period shall mean the period commencing on the date of this Agreement
and ending August 4, 2008; provided, however, that the Revolving Credit Period shall end on the
date the Lender’s Revolving Credit Commitment is terminated pursuant to Section 6 or otherwise.



S&P shall mean Standard & Poor’s Ratings Group.



SM&P shall mean SM&P Utility Resources, Inc., an Indiana corporation, and a Subsidiary
of Borrower.



Subsidiary shall mean any corporation or other entity of which more than Fifty Percent
(50%) of the issued and outstanding capital stock or other equity interests entitled to vote for
the election of directors or persons performing similar functions (other than by reason of default
in the payment of dividends or other distributions) is at the time owned directly or indirectly by
Borrower or any Subsidiary.



Taxes shall have the meaning ascribed thereto in Section 2.20(a).



Total Revolving Credit Outstandings shall mean, as of any date, the sum of (a) the
aggregate principal amount of all Loans outstanding as of such date, plus (b) the aggregate
undrawn face amount of all Letters of Credit outstanding as of such date plus (c) all
unreimbursed drawings with respect to all Letters of Credit.



Transaction Documents shall mean this Agreement, the Note and any and all other
agreements, documents and instruments heretofore, now or hereafter delivered to the Agent or any
Bank with respect to or in connection with or pursuant to this Agreement, any Loans made hereunder
or any of the other Borrower’s Obligations, and executed by or on behalf of Borrower, all as the
same may from time to time be amended, modified, extended, renewed or restated.



SECTION 2. LOANS.



2.01 Loans.



(a) Subject to the terms and conditions set forth in this Agreement and so long as no Default
or Event of Default has occurred and is continuing, during the Revolving Credit Period, Lender
agrees to make such loans to Borrower (individually, a “Loan” and collectively, the
“Loans”) as Borrower may from time to time request pursuant to Section 2.02. Each Loan
under this Section 2.01(a) which is a Prime Loan shall be for an aggregate principal amount of at
least $50,000.00 or any larger multiple of $10,000.00. Each Loan under this Section 2.01(a) which
is a LIBOR Loan shall be for an aggregate principal amount of at least $1,000,000.00 or any larger
multiple of $250,000.00; provided, that Borrower may not have outstanding and Lender shall not be
obligated to make more than eight (8) LIBOR Loans at any one time. The aggregate principal amount
of Loans that Lender shall be required to have outstanding under this Agreement as of any date
shall not exceed the amount of Lender’s Revolving Credit Commitment as of such date. Within the
foregoing limits, Borrower may borrow under this Section 2.01(a), prepay under Section 2.08 and
reborrow at any time during the Revolving Credit Period under this Section 2.01(a). All Loans not
paid prior to the last day of the Revolving Credit Period, together with all accrued and unpaid
interest thereon and all fees and other amounts owing by Borrower to Lender with respect thereto,
shall be due and payable on the last day of the Revolving Credit Period.



(b) If the amount of Lender’s Revolving Credit Commitment on any date is less than the Total
Revolving Credit Outstandings on such date, whether as a result of Borrower’s election to decrease
the amount of Lender’s Revolving Credit Commitment pursuant to Section 2.01(c) or otherwise,
Borrower shall be automatically required (without demand or notice of any kind by Lender, all of
which are hereby expressly waived by Borrower) to immediately repay the Loans in an amount
sufficient to reduce the amount of the Total Revolving Credit Outstandings to an amount equal to or
less than the amount of Lender’s Revolving Credit Commitment.



(c) Borrower may, upon five (5) Business Days’ prior written notice to Lender, terminate
entirely at any time, or reduce from time to time by an aggregate amount of $1,000,000 or any
larger multiple of $1,000,000 the unused portions of Lender’s Revolving Credit Commitment;
provided, however, that (i) at no time shall the amount of Lender’s Revolving Credit Commitment be
reduced to a figure less than the Total Revolving Credit Outstanding, (ii) at no time shall the
amount of Lender’s Revolving Credit Commitment be reduced to a figure greater than zero (0) but
less than $5,000,000 and (iii) any such termination or reduction shall be permanent and Borrower
shall have no right to thereafter reinstate or increase, as the case may be, Lender’s Revolving
Credit Commitment.



2.02 Method of Borrowing.



(a) Borrower shall give Lender oral or written notice (a “Notice of Borrowing”) by
10:00 a.m. (St. Louis time) on the Business Day of each Prime Loan to be made to Borrower, and by
10:00 a.m. (St. Louis time) at least three (3) New York Business Days before each LIBOR Loan to be
made to Borrower, specifying: (i) the date of such Loan, which shall be a Business Day during the
Revolving Credit Period in the case of a Prime Loan and a New York Business Day during the
Revolving Credit Period in the case of a LIBOR Loan, (ii) the aggregate principal amount of such
Loan, (iii) whether such Loan is to be a Prime Loan or a LIBOR Loan, and (iv) in the case of a
LIBOR Loan, the duration of the initial Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.



(b) A Notice of Borrowing shall not be revocable by Borrower.



(c) Subject to the terms and conditions of this Agreement, provided that Lender has received
the Notice of Borrowing, Lender shall (unless Lender determines that any applicable condition
specified in Section 3 has not been satisfied) make the applicable Loan to Borrower by crediting
the amount of such Loan to a demand deposit account of Borrower at Lender specified by Borrower (or
such other account mutually agreed upon in writing between Lender and Borrower) not later than 2:30
p.m. (St. Louis time) on the Business Day specified in said Notice of Borrowing.



(d) If Lender makes a new Loan under this Agreement on a day on which Borrower is required to
or has elected to repay all or any part of an outstanding Loan, Lender shall apply the proceeds of
its new Loan to make such repayment and only an amount equal to the difference (if any) between the
amount being borrowed and the amount being repaid shall be made available by Lender to Borrower.



(e) Borrower hereby irrevocably authorizes Lender to rely on telephonic, telegraphic,
telecopy, telex or written instructions of any individual identifying himself or herself as one of
the individuals listed on Schedule 2.02 attached hereto (or any other individual from time
to time authorized to act on behalf of Borrower pursuant to a document signed by the Chairman of
the Board of Borrower and certified by the Secretary of Borrower and delivered to Lender) with
respect to any request to make a Loan or a repayment under this Agreement, and on any signature
that Lender reasonably believes to be genuine, and Borrower shall be bound thereby in the same
manner as if such individual were actually authorized or such signature were genuine. Borrower
also hereby agrees to defend and indemnify Lender and hold Lender harmless from and against any and
all claims, demands, damages, liabilities, losses and reasonable costs and expenses (including,
without limitation, reasonable attorneys’ fees and expenses) relating to or arising out of or in
connection with the acceptance of instructions for making Loans or repayments under this Agreement.



2.03 Note.



(a) The Loans of Lender to Borrower shall be evidenced by the Amended and Restated Revolving
Credit Note of Borrower payable to the order of Lender in a principal amount equal to the maximum
amount of Lender’s Revolving Credit Commitment, which Amended and Restated Revolving Credit Note
shall be in substantially the form of Exhibit A attached hereto and incorporated herein by
reference (with appropriate insertions) (as the same may from time to time be amended, modified,
extended, renewed or restated, the “Note”).



(b) Lender shall record in its books and records the date, amount, type and Interest Period
(if any) of each Loan made by it to Borrower and the date and amount of each payment of principal
and/or interest made by Borrower with respect thereto; provided, however, that the obligation of
Borrower to repay each Loan made by Lender to Borrower under this Agreement shall be absolute and
unconditional, notwithstanding any failure of Lender to make any such recordation or any mistake by
Lender in connection with any such recordation. The books and records of Lender showing the
account between Lender and Borrower shall be conclusive in the absence of manifest error.



2.04 Duration of Interest Periods and Selection of Interest Rates.



(a) The duration of the initial Interest Period for each LIBOR Loan shall be as specified in
the applicable Notice of Borrowing. Borrower shall elect the duration of each subsequent Interest
Period applicable to such LIBOR Loan and the interest rate to be applicable during such subsequent
Interest Period (and Borrower shall have the option (i) in the case of any Prime Loan, to elect
that such Loan become a LIBOR Loan and the Interest Period to be applicable thereto, and (ii) in
the case of any LIBOR Loan, to elect that such Loan become a Prime Loan), by giving notice of such
election to Lender by 10:00 a.m. (St. Louis time) on the Business Day of, in the case of the
election of the Adjusted Prime Rate, and by 10:00 a.m. (St. Louis time) at least three (3) New York
Business Days before, in the case of the election of the LIBOR Rate, the end of the immediately
preceding Interest Period applicable thereto, if any; provided, however, that notwithstanding the
foregoing, in addition to and without limiting the rights and remedies of Lender under Section 6 of
this Agreement, so long as any Default or Event of Default under this Agreement has occurred and is
continuing, Borrower shall not be permitted to renew any LIBOR Loan as a LIBOR Loan or to convert
any Prime Loan into a LIBOR Loan. If Lender does not receive a notice of election for a Loan
pursuant to this Section 2.04(a) within the applicable time limits specified herein, Borrower shall
be deemed to have elected to pay such Loan in whole pursuant to Section 2.08 on the last day of the
current Interest Period with respect thereto and to reborrow the principal amount of such Loan on
such date as a Prime Loan.



(b) Borrower may not have outstanding and Lender shall not be obligated to make more than
eight (8) LIBOR Loans at any one time.



2.05 Interest Rates and Interest Payments. (a) So long as no Event of Default has
occurred and is continuing, each Prime Loan shall bear interest on the outstanding principal amount
thereof for each day until paid at an annual rate equal to the Adjusted Prime Rate. So long as any
Event of Default has occurred and is continuing, each Prime Loan shall bear interest on the
outstanding principal amount thereof for each until it is paid, at an annual rate equal to Five
Percent (5%) over and above the Adjusted Prime Rate. Such interest shall be payable monthly in
arrears on the last day of each calendar month commencing August 31, 2005 and at the maturity of
the Note (whether by reason of acceleration or otherwise). From and after the maturity of the
Note, whether by reason of acceleration or otherwise, each Prime Loan shall bear interest, payable
on demand, for each day until paid at an annual rate equal to Five Percent (5%) over and above the
Adjusted Prime Rate.



(b) So long as no Event of Default has occurred and is continuing, each LIBOR Loan shall bear
interest on the outstanding principal amount thereof for each Interest Period applicable thereto at
an annual rate equal to the LIBOR Rate. So long as any Event of Default has occurred and is
continuing, each LIBOR Loan shall bear interest on the outstanding principal amount thereof for
each Interest Period applicable thereto at an annual rate equal to Five Percent (5%) over and above
the LIBOR Rate. Such interest shall be payable for each Interest Period on the last day thereof,
unless the duration of such Interest Period exceeds three (3) months, in which case such interest
shall be payable on the last day of each three (3) month period during such Interest Period and on
the last day of such Interest Period, and at the maturity of the Note (whether by reason of
acceleration or otherwise). From and after the maturity of the Note, whether by reason of
acceleration or otherwise, each LIBOR Loan shall bear interest, payable on demand, for each day
until paid, at an annual rate equal to Five Percent (5%) over and above the higher of (i) the LIBOR
Rate applicable to such LIBOR Loan for the immediately preceding Interest Period or (ii) the
Adjusted Prime Rate.



(c) Lender shall determine each interest rate applicable to the Prime Loans and LIBOR Loans
hereunder and its determination thereof shall be conclusive in the absence of manifest error.



2.06 Computation of Interest. Interest on Prime Loans hereunder shall be computed on
the basis of a year of 360 days and paid for the actual number of days elapsed (including the first
day but excluding the last day). Interest on LIBOR Loans shall be computed on the basis of a year
of 360 days and paid for the actual number of days elapsed, calculated as to each Interest Period
from and including the first day thereof to but excluding the last day thereof.



2.07 Fees.



(a) Contemporaneously with the execution of this Agreement, Borrower shall pay Lender a
nonrefundable upfront fee in the amount set forth in the fee letter provided by Lender to Borrower.



(b) From and including the date of this Agreement to but excluding the last day of the
Revolving Credit Period, Borrower shall pay a nonrefundable commitment fee on the unused portion of
Lender’s Revolving Credit Commitment (determined by subtracting the Total Revolving Credit
Outstandings from the amount of Lender’s Revolving Credit Commitment) at a percentage rate equal to
the Applicable Commitment Fee Rate. Said commitment fee shall be (i) calculated on a daily basis,
(ii) payable quarterly in arrears on each June 30, September 30, December 31, and March 31 during
the Revolving Credit Period commencing September 30, 2005, and on the last day of the Revolving
Credit Period and (iii) calculated on an actual day, 360-day year basis.



2.08 Prepayments. Borrower may, upon notice to Lender specifying that it is paying
any Prime Rate Loan, pay without penalty or premium the Prime Loan in whole at any time or in part
from time to time, by paying the principal amount to be paid, provided that partial prepayments
shall be in an aggregate amount of at least $1,000,000.00 or any larger multiple of $500,000.00.
Borrower may, upon at least three (3) New York Business Day’s irrevocable prior written notice to
Lender, prepay all at any time or any portion from time to time of the unpaid principal balance of
any LIBOR Loan prior to maturity provided that (i) contemporaneously with each such prepayment
Borrower shall pay all accrued and unpaid interest on the portion of the LIBOR Loan being prepaid
to and including the date of prepayment; (ii) partial prepayments shall be in an aggregate amount
of at least $2,000,000.00 or any larger multiple of $1,000,000.00; (iii) in no event may Borrower
make any prepayment on any LIBOR Loan that results in the remaining LIBOR Loans with respect to
which a given Interest Period applies being greater than $0.00 but less than $1,000,000.00 and (iv)
if Borrower is making a prepayment of a LIBOR Loan, contemporaneously with such prepayment,
Borrower shall pay Lender the funding losses and other amounts, if any, required under Section
2.10.



2.09 General Provisions as to Payments. Borrower shall make each payment of principal
of, and interest on, the Loan and of fees and all other amounts payable by Borrower under this
Agreement, not later than 12:00 noon (St. Louis time) on the date when due and payable in Federal
or other funds immediately available in St. Louis, Missouri, to Lender at its address referred to
in Section 7.05. All payments received by Lender after 12:00 noon (St. Louis time) shall be deemed
to have been received by Lender on the next succeeding Business Day. Whenever any payment of
principal of, or interest on, the Loan or of fees shall be due on a day which is not a Business
Day, the date for payment thereof shall be extended to the next succeeding Business Day. If the
date for any payment of principal is extended by operation of law or otherwise, interest thereon,
at the then applicable rate, shall be payable for such extended time.



2.10 Funding Losses. Notwithstanding any provision contained in this Agreement to the
contrary, (a) Borrower shall make any payment of principal with respect to any LIBOR Loan on any
day other than the last day of the Interest Period applicable thereto, whether as a result of a
scheduled payment, a voluntary prepayment, a mandatory prepayment, maturity, acceleration or
otherwise or (b) any LIBOR Loan is converted to a Prime Loan pursuant to Section 2.04, Section 2.11
or Section 2.12 on any day other than the last day of the Interest Period applicable thereto,
contemporaneously with each such payment or conversion Borrower shall reimburse Lender on demand
for any resulting losses and expenses incurred by Lender, including , without limitation, any
losses incurred in obtaining, liquidating, or employing deposits from third parties, but excluding
any loss of the Applicable LIBOR Margin for the period after any such prepayment, provided that
Lender shall have delivered to Borrower a certificate as to the amount of such losses and expenses,
which certificate shall be conclusive in the absence of manifest error.



2.11 Basis for Determining Interest Rate Inadequate or Unfair. If with respect to any
Interest Period: (a) deposits in U.S. Dollars (in the applicable amounts) are not being offered to
Lender in the relevant market for such Interest Period, or (b) Lender determines in good faith that
the LIBOR Rate as determined pursuant to the definition thereof will not adequately and fairly
reflect the cost to Lender of maintaining or funding the LIBOR Loans for such Interest Period,
Lender shall forthwith give notice thereof to Borrower whereupon until Lender notifies Borrower
that the circumstances giving rise to such suspension no longer exist, (i) the LIBOR Rate shall not
be available to Borrower as an interest rate option on any portion of the Loan and (ii) all of the
then outstanding LIBOR Loans shall automatically convert to Prime Loans on the last day of the then
current Interest Period applicable to each such LIBOR Loan. Interest accrued on each such LIBOR
Loan prior to any such conversion shall be due and payable on the date of such conversion together
with any funding losses and other amounts due under Section 2.10.



2.12 Illegality. If, after the date of this Agreement, the adoption of any applicable
law, rule or regulation, or any change therein, or any change in the interpretation or
administration thereof by any governmental or regulatory authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance by Lender with any
request or directive (whether or not having the force of law) of any such governmental or
regulatory authority, central bank or comparable agency (a “Regulatory Change”) shall make
it unlawful or impossible for Lender to make, maintain or fund its LIBOR Loans to Borrower, Lender
shall forthwith give notice thereof to Borrower. Upon receipt of such notice, Borrower shall
convert all of its then outstanding LIBOR Loans on either (a) the last day of the then current
Interest Period applicable to such LIBOR Loan if Lender may lawfully continue to maintain and fund
such LIBOR Loan to such day or (b) immediately if Lender may not lawfully continue to fund and
maintain such LIBOR Loan to such day, to a Prime Loan in an equal principal amount. Interest
accrued on each such LIBOR Loan prior to any such conversion shall be due and payable on the date
of such conversion together with any funding losses and other amounts due under Section 2.10.



2.13 Increased Cost. (a) If (i) Regulation D or (ii) a Regulatory Change: (A) shall
subject Lender to any tax, duty or other charge with respect to the LIBOR Loans, the Note or its
obligation to make LIBOR Loans, or shall change the basis of taxation of payments to Lender of the
principal of or interest on its LIBOR Loans or any other amounts due under this Agreement in
respect of its LIBOR Loans or its obligation to make LIBOR Loans (except for taxes on or changes in
the rate of tax on the overall net income of Lender); or (B) shall impose, modify or deem
applicable any reserve (including, without limitation, any reserve imposed by the Board of
Governors of the Federal Reserve System), special deposit, capital or similar requirement against
assets of, deposits with or for the account of, or credit extended or committed to be extended by,
Lender or shall, with respect to Lender impose, modify or deem applicable any other condition
affecting Lender’s LIBOR Loans, the Note or Lender’s obligation to make LIBOR Loans; and the result
of any of the foregoing is to increase the cost to (or in the case of Regulation D, to impose a
cost on or increase the cost to) Lender of making or maintaining any LIBOR Loan, or to reduce the
amount of any sum received or receivable by Lender under this Agreement or under its Note with
respect thereto, by an amount deemed by Lender to be material, and if Lender is not otherwise fully
compensated for such increase in cost or reduction in amount received or receivable by virtue of
the inclusion of the reference to “LIBOR Reserve Percentage” in the calculation of the LIBOR Rate,
then upon notice by Lender to Borrower, which notice shall set forth Lender’s supporting
calculations and the details of the Regulatory Change, Borrower shall pay Lender, as additional
interest, such additional amount or amounts as will compensate Lender for such increased cost or
reduction. The determination by Lender under this Section of the additional amount or amounts to
be paid to it hereunder shall be conclusive in the absence of manifest error. In determining such
amount or amounts, Lender may use any reasonable averaging and attribution methods.



(b) If Lender demands compensation under Section 2.13(a) above, Borrower may at any time, upon
at least three (3) New York Business Day’s prior notice to Lender, convert its then outstanding
LIBOR Loans to Prime Loans in an equal principal amount. Interest accrued on each such LIBOR Loan
prior to any such conversion shall be due and payable on the date of such conversion together with
any funding losses and other amounts due under Section 2.10 and this Section 2.13.



2.14 Prime Loans Substituted for Affected LIBOR Loans. If notice has been given by
Lender pursuant to Sections 2.11 or 2.12 or by Borrower pursuant to Section 2.04 requiring LIBOR
Loans to be repaid or converted to Prime Loans, then, unless and until Lender notifies Borrower
that the circumstances giving rise to such repayment or conversion no longer apply, any portion of
the Loans that would otherwise be made by Lender to Borrower as LIBOR Loans shall be made instead
as Prime Loans. Lender shall promptly notify Borrower if and when the circumstances giving rise to
such repayment no longer apply.



2.15 Capital Adequacy If, after the date of this Agreement, Lender shall have
determined in good faith that a Regulatory Change has occurred which has or will have the effect of
reducing the rate of return on Lender’s capital in respect of its obligations hereunder to a level
below that which Lender could have achieved but for such adoption, change or compliance (taking
into consideration Lender’s policies with respect to capital adequacy), then from time to time
Borrower shall pay to Lender upon demand such additional amount or amounts as will compensate
Lender for such reduction. All determinations made in good faith by Lender of the additional
amount or amounts required to compensate it in respect of the foregoing shall be conclusive in the
absence of manifest error. In determining such amount or amounts, Lender may use any reasonable
averaging and attribution methods.



2.16 Survival of Indemnities. All indemnities and all provisions relating to
reimbursement to Lender of amounts sufficient to protect the yield to Lender with respect to the
Loan, including, without limitation, Sections 2.10, 2.13 and 2.15 hereof, shall survive the payment
of the Note and the other Borrower’s Obligations and the expiration or termination of this
Agreement. Notwithstanding the foregoing, if Lender fails to notify Borrower of any event that
will entitle Lender to compensation pursuant to Sections 2.10, 2.13 and/or 2.15 hereof within one
hundred eighty (180) days after Lender obtains knowledge of such event, then Lender shall not be
entitled to any compensation from Borrower for any loss, expense, increased cost and/or reduction
of return arising from such event.



2.17 Discretion of Lender as to Manner of Funding. Notwithstanding any provision
contained in this Agreement to the contrary, Lender shall be entitled to fund and maintain its
funding of all or any part of its LIBOR Loans in any manner it elects, it being understood,
however, that for purposes of this Agreement all determinations hereunder (including, without
limitation, the determination of Lender’s funding losses and expenses under Section 2.10) shall be
made as if Lender had actually funded and maintained each LIBOR Loan through the purchase of
deposits having a maturity corresponding to the maturity of the applicable Interest Period relating
to the applicable LIBOR Loan and bearing an interest rate equal to the applicable LIBOR Base Rate.



2.18 Letters of Credit. (a) Subject to the terms and conditions of this Agreement and
so long as no Default or Event of Default has occurred and is continuing, during the Revolving
Credit Period, Lender agrees to issue irrevocable commercial and/or standby letters of credit for
the account of Borrower and/or any Subsidiary (individually, a “Letter of Credit”, and
collectively, “Letters of Credit”) in an amount and for the term specifically requested by
Borrower by notice in writing to Lender at least two (2) Business Days prior to the requested
issuance thereof; provided, however, that: (i) Borrower shall have executed and delivered to Lender
a Letter of Credit Application with respect to such Letter of Credit; (ii) the term of any such
Letter of Credit shall not extend beyond the earlier of (A) the date one (1) year after the date of
issuance thereof, or (B) the last day of the Revolving Credit Period; (iii) any Letter of Credit
may only be utilized to guaranty the payment of obligations of Borrower or a Subsidiary to third
parties; (iv) Total Revolving Credit Outstandings shall not as of any date exceed Lender’s
Revolving Credit Commitment; (v) the sum of the aggregate undrawn face amount of all outstanding
Letters of Credit plus all unreimbursed drawings with respect thereto shall not as of any
date exceed Thirty Million Dollars ($30,000,000.00); and (vi) the text of any such Letter of Credit
is provided to Lender no less than two (2) Business Days prior to the requested issuance date,
which text must be acceptable to Lender in its sole and absolute discretion.



(b) The payment of drafts under each Letter of Credit shall be made in accordance with the
terms thereof and, in that connection, Lender shall be entitled to honor any drafts and accept any
documents presented to it by the beneficiary of such Letter of Credit in accordance with the terms
of such Letter of Credit and the related Letter of Credit Application and believed in good faith by
Lender to be genuine. Lender shall not have any duty to inquire as to the accuracy or authenticity
of any draft or other drawing document that may be presented to it other than the duties
contemplated by the applicable Letter of Credit Application.



(c) In the event of any payment by Lender of a draft presented under a Letter of Credit,
Borrower agrees to pay to Lender in immediately available funds at the time of such drawing an
amount equal to the sum of such drawing plus the negotiation, processing and other fees
related thereto, as may be agreed between Lender and Borrower from time to time. Borrower hereby
authorizes Lender to charge or cause to be charged one or more of Borrower’s deposit accounts at
Lender to the extent there are balances of immediately available funds therein, in an aggregate
amount equal to the sum of such drawing plus the negotiation, processing and other fees
related thereto as may be agreed between Lender and Borrower from time to time, and Borrower agrees
to pay the amount of any such drawing (and/or Lender’s customary negotiation, processing and other
fees related thereto) not so charged prior to the close of business of Lender on the day of such
drawing. In the event any payment under a Letter of Credit is made by Lender prior to receipt of
payment from Borrower, such payment by Lender shall constitute a request by Borrower for a Prime
Loan under Sections 2.01 and 2.02 above (and Lender will make such Prime Loan to Borrower
regardless of whether any Default or Event of Default under this Agreement has occurred and is
continuing and regardless of whether such Prime Loan would otherwise be permitted under the
requirements of this Agreement) and the proceeds of such Prime Loan shall be paid directly to
Lender and applied by Lender to the payment of any amounts owed by Borrower to Lender under this
Section 2.18.



(d) Borrower hereby further agrees to pay to the order of Lender with respect to each Letter
of Credit: (i) a nonrefundable commitment fee at an annual rate equal to the Applicable LIBOR
Margin (calculated on an actual day, 360-day year basis) on the face amount (taking into account
any scheduled increases or decreases therein during the period in question) of each Letter of
Credit, due and payable quarterly, in arrears, on the first day of each fiscal quarter; and (ii) a
nonrefundable issuance fee, a nonrefundable negotiation fee and such other fees as may be charged
by Lender from time to time in accordance with Lender’s published schedule of fees in effect from
time to time, which fees shall be due and payable on demand by Lender.



(e) Notwithstanding any provision contained in this Agreement to the contrary, if any Letters
of Credit remain outstanding on the last day of the Revolving Credit Period, Borrower shall, on or
before 12:00 noon (St. Louis time) on the last day of the Revolving Credit Period, (i) surrender
the originals of the applicable Letter(s) of Credit to Lender for cancellation, or (ii) provide
Lender with cash collateral (or other collateral acceptable to Lender in its sole and absolute
discretion) in an amount at least equal to the aggregate undrawn face amount of all outstanding
Letter(s) of Credit plus all unreimbursed drawings with respect thereto, and execute and
deliver to Lender such agreements as Lender may require to grant Lender a first priority perfected
security interest in such cash or other collateral. Any such cash collateral received by Lender
pursuant to this Section 2.18(e) shall be held by Lender in a separate account at Lender
appropriately designated as a cash collateral account in relation to this Agreement and the Letters
of Credit and retained by Lender as collateral security for the payment of Borrower’s Obligations.
Cash amounts delivered to Lender pursuant to the foregoing requirements of this Section 2.18(e)
shall be invested, at the request and for the account of Borrower in investments of a type and
nature and with a term acceptable to Lender. Such amounts, including in the case of cash amounts
invested in the manner set forth above, shall not be used by Lender to pay any amounts drawn or
paid under or pursuant to any Letter of Credit, but may be applied to reimburse Lender for drawings
or payments under or pursuant to such Letters of Credit which Lender has paid, or if no such
reimbursement is required to the payment of such of the other Borrower’s Obligations as Lender
shall determine. Any amounts remaining in any cash collateral account established pursuant to this
Section 2.18(e) after the payment in full of all of the Borrower’s Obligations and the expiration
or cancellation of all of the Letters of Credit shall be returned to Borrower (after deduction of
Lender’s reasonable expenses, if any).



2.20 Taxes.



(a) Any and all payments by Borrower to or for the account of Lender under any Transaction
Document shall be made free and clear of and without deduction for any and all present or future
taxes, duties, levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, in the case of Lender, taxes imposed on or measured by its net
income, and franchise taxes imposed on it, by the jurisdiction under the laws of which Lender is
organized or any political subdivision thereof (all such non-excluded taxes, duties, levies,
imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as
“Taxes”). If Borrower shall be required by law to deduct any Taxes from or in respect of
any sum payable under any Transaction Document to Lender, (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.20(a)) Lender receives an amount equal to the sum it
would have received had no such deduction of Taxes been made, (ii) Borrower shall make such
deductions, (iii) Borrower shall pay the full amount deducted to the relevant taxation authority or
other authority in accordance with applicable law and (iv) Borrower shall furnish to Lender the
original or a certified copy of a receipt evidencing payment thereof.



(b) In addition, Borrower agrees to pay any present or future stamp or documentary taxes and
any other excise or property taxes, or charges or similar levies which arise from any payment made
under any of the Transaction Documents or from the execution or delivery of, or otherwise with
respect to, any of the Transaction Documents (hereinafter referred to as “Other Taxes”).



(c) Borrower agrees to indemnify Lender for the full amount of Taxes or Other Taxes,
respectively (including, without limitation, any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section 2.20), paid by Lender and any liability
(including penalties, interest and expenses) arising therefrom or with respect thereto. This
indemnification shall be made within fifteen (15) days from the date Lender makes demand therefor,
accompanied by a certificate of Lender setting forth in reasonable detail its computation of the
amount or amounts to be paid to it hereunder.



(d) The provisions of this Section 2.20 shall survive any expiration or termination of this
Agreement and the payment of the Note and the other Borrower’s Obligations.



SECTION 3. PRECONDITIONS TO LOANS AND LETTERS OF CREDIT.



3.01 Initial Loan. Notwithstanding any provision contained in this Agreement to the
contrary, Lender shall have no obligation to make the initial Loan or issue the initial Letter of
Credit under this Agreement unless Lender shall have first received:




	 	(a)	 	this Agreement and the Note, each duly executed by Borrower;






	 	(b)	 	the Guaranties, duly executed by Laclede Energy and SM&P;






(c) a copy of resolutions (including an incumbency certificate) of the Board of Directors of
Borrower, duly adopted, which authorize the execution, delivery and performance of this
Agreement, the Note and the other Transaction Documents, certified by the Secretary of
Borrower;




(d) a copy of resolutions of the Board of Directors (including an incumbency certificate) of
Laclede Energy, duly adopted, which authorize the execution, delivery and performance of its
Guaranty, certified by the Secretary of Laclede Energy;




(e) a copy of resolutions of the Board of Directors (including an incumbency certificate) of
SM&P, duly adopted, which authorize the execution, delivery and performance of its Guaranty,
certified by the Secretary of SM&P;




(f) copies of the Articles of Incorporation of Borrower, Laclede Energy and SM&P, including
any amendments thereto, certified by the Secretary of State of the states of their
respective incorporations;




(g) copies of the Bylaws of Borrower, Laclede Energy and SM&P, including any amendments
thereto, certified by the Secretaries of Borrower, Laclede Energy and SM&P;




(h) certificates of corporate good standing of Borrower, Laclede Energy and SM&P issued by
the the Secretary of State of the states of their respective incorporations;




(i) an opinion of the General Counsel of Borrower, Laclede Energy and of SM&P, in form and
substance satisfactory to Lender and Lender’s counsel;




(j) UCC search results from the Missouri Secretary of State for Borrower and Laclede Energy,
and from the Indiana Secretary of State for SM&P;




(k) copies of all financial statements and other exhibits and schedules required by this
Agreement and the other Transaction Documents;




(l) a letter of direction from Borrower with respect to the disbursement of the proceeds of
the initial Loan under this Agreement; and




(m) such other agreements, documents, instruments and certificates as Lender may reasonably
request.



3.02 All Loans and Letters of Credit. Notwithstanding any provision contained in this
Agreement to the contrary, Lender shall have no obligation to make any Loan or issue any Letter of
Credit under this Agreement unless:




(a) Lender shall have received a Notice of Borrowing for such Loan as required by Section
2.02(a), or a Letter of Credit Application as required under Section 2.18(a);




(b) both immediately before and immediately after giving effect to such Loan or Letter of
Credit, no Default or Event of Default shall have occurred and be continuing; and




(c) all of the representations and warranties made by Borrower in this Agreement and/or in
any other Transaction Document shall be true and correct in all material respects on and as
of the date of such Loan as if made or such Letter of Credit is issued on and as of the date
of such Loan or Letter of Credit (and for purposes of this Section 3.02(d), the
representations and warranties made by Borrower in Section 4.04 shall be deemed to refer to
the most recent financial statements of Borrower delivered to Lender pursuant to Section
5.01(a)).



Each request for a Loan or Letter of Credit by Borrower under this Agreement shall be deemed to be
a representation and warranty by Borrower on the date of such Loan or Letter of Credit as to the
facts specified in clauses (b), and (c) of this Section 3.02.



SECTION 4. REPRESENTATIONS AND WARRANTIES.



Borrower hereby represents and warrants to Lender that:



4.01 Corporate Existence and Power. Borrower: (a) is duly incorporated, validly
existing and in good standing under the laws of the State of Missouri; (b) has all requisite
corporate powers required to carry on its business as now conducted; (c) has all requisite
governmental and regulatory licenses, authorizations, consents and approvals required to carry on
its business as now conducted, except such licenses, authorizations, consents and approvals the
failure to have could not reasonably be expected to have a Material Adverse Effect; and (d) is
qualified to transact business as a foreign corporation in, and is in good standing under the laws
of, all states in which it is required by applicable law to maintain such qualification and good
standing except for those states in which the failure to qualify or maintain good standing could
not reasonably be expected to have a Material Adverse Effect.



4.02 Corporate Authorization. The execution, delivery and performance by Borrower of
this Agreement, the Note and the other Transaction Documents are within the corporate powers of
Borrower and have been duly authorized by all necessary corporate and other action on the part of
Borrower.



4.03 Binding Effect. This Agreement, the Note and the other Transaction Documents
have been duly executed and delivered by Borrower and constitute the legal, valid and binding
obligations of Borrower enforceable against Borrower in accordance with their respective terms,
except as such enforceability may be limited by bankruptcy, insolvency or other similar laws
affecting creditors’ rights generally and by general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law).



4.04 Financial Statements. Borrower has furnished Lender with the consolidated
balance sheets and statements of income, retained earnings and cash flows of Borrower and its
Subsidiaries as of and for the fiscal year of Borrower ended September 30, 2004, all certified by
Borrower’s independent certified public accountants, which financial statements have been prepared
in accordance with GAAP consistently applied. Borrower further represents and warrants to Lender
that (a) said balance sheets and their accompanying notes (if any) fairly present the condition of
Borrower and its Subsidiaries as of the dates thereof, (b) there has been no material adverse
change in the condition or operation, financial or otherwise, of Borrower and its Subsidiaries
taken as a whole since September 30, 2004 except as disclosed in Borrower’s filings with the
Securities and Exchange Commission since such date, and (c) neither Borrower nor any of its
Subsidiaries had any direct or contingent liabilities which were not disclosed on said financial
statements or the notes thereto (to the extent such disclosure is required by GAAP).



4.05 Compliance With Other Instruments; None Burdensome. None of the execution and
delivery by Borrower of the Transaction Documents, the performance by Borrower of its obligations
under the Transaction Documents or the borrowing and/or repayment of the Loan by Borrower under
this Agreement will conflict with, or result in a breach of the terms, conditions or provisions of,
or constitute a default under or result in any violation of, any law, rule, regulation, order,
writ, judgment, injunction, decree or award binding on Borrower, any of the provisions of the
Articles of Incorporation or Bylaws of Borrower or any of the provisions of any indenture,
agreement, document, instrument or undertaking to which Borrower is a party or subject, or by which
Borrower or any property or assets of Borrower is bound, or result in the creation or imposition of
any security interest, lien or encumbrance on any of the property or assets of Borrower pursuant to
the terms of any such indenture, agreement, document, instrument or undertaking. No order,
consent, approval, license, authorization or validation of, or filing, recording or registration
with, or exemption by, any governmental, regulatory, administrative or public body,
instrumentality, authority, agency or official, or any subdivision thereof, or any other Person is
required to authorize, or is required in connection with, (a) the execution, delivery or
performance of, or the legality, validity, binding effect or enforceability of, any of the
Transaction Documents and/or (b) the borrowing and/or repayment of the Loan by Borrower under this
Agreement.



4.06 Regulation U. Borrower is not engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or carrying margin
stock (within the meaning of Regulation U of The Board of Governors of the Federal Reserve System,
as amended) and no part of the proceeds of the Loan will be used, whether directly or indirectly,
and whether immediately, incidentally or ultimately (a) to purchase or carry margin stock or to
extend credit to others for the purpose of purchasing or carrying margin stock, or to refund or
repay indebtedness originally incurred for such purpose or (b) for any purpose that entails a
violation of, or which is inconsistent with, the provisions of any of the Regulations of The Board
of Governors of the Federal Reserve System, including, without limitation, Regulations U, T or X
thereof, as amended. If requested by Lender, Borrower shall furnish to Lender a statement in
conformity with the requirements of Federal Reserve Form U-1 referred to in Regulation U.



4.07 Investment Company Act of 1940; Public Utility Holding Company Act of 1935.
Borrower is not an “investment company” as that term is defined in, and is not otherwise subject to
regulation under, the Investment Company Act of 1940, as amended. Borrower is an exempt holding
company pursuant to 15 U.S.C. Section 79c(a)(1).



4.08 No Default. No Default or Event of Default under this Agreement has occurred and
is continuing. There is no existing default or event of default under or with respect to any
indenture, contract, agreement, lease or other instrument to which Borrower is a party or by which
any property or assets of Borrower is bound or affected, a default under which could reasonably be
expected to have a Material Adverse Effect. Borrower has and is in full compliance with and in
good standing with respect to all governmental permits, licenses, certificates, consents and
franchises necessary to continue to conduct its business as previously conducted by it and to own
or lease and operate its properties and assets as now owned or leased by it, the failure to have or
noncompliance with which could reasonably be expected to have a Material Adverse Effect. Borrower
is not in violation of any applicable statute, law, rule, regulation or ordinance of the United
States of America, of any state, city, town, municipality, county or of any other jurisdiction, or
of any agency thereof, a violation of which could reasonably be expected to have a Material Adverse
Effect.



SECTION 5. COVENANTS.



5.01 Covenants of Borrower. Borrower covenants and agrees that, so long as any of the
Borrower’s Obligations remain unpaid:



(a) Information. Borrower will make available, deliver, or cause to be delivered to
Lender:




(i) within one hundred twenty (120) days after the end of each fiscal year of Borrower the
consolidated balance sheet of Borrower and its Subsidiaries as of the end of such fiscal
year and the related consolidated statements of income, retained earnings and cash flows for
such fiscal year, setting forth in each case, in comparative form, the figures for the
previous fiscal year, all such financial statements to be prepared in accordance with GAAP
consistently applied and reported on by and accompanied by the unqualified opinion of
independent certified public accountants selected by Borrower and reasonably acceptable to
Lender; provided, however, that delivery to Lender of the Annual Report on Form 10-K of
Borrower for such fiscal year filed with the Securities and Exchange Commission shall be
deemed to satisfy the requirements of this Section 5.01(a)(i);




(ii) within one hundred twenty (120) days after the end of each fiscal year of Guarantors
the consolidated balance sheets of Guarantors and their Subsidiaries as of the end of such
fiscal year and the related consolidated statements of income, retained earnings and cash
flows for such fiscal year, setting forth in each case, in comparative form, the figures for
the previous fiscal year, all such financial statements to be prepared internally by
Guarantors in accordance with GAAP consistently applied.




(iii) within fifty (50) days after the end of the first three (3) fiscal quarters of each
fiscal year of Borrower, a consolidated balance sheet of Borrower and its Subsidiaries as of
the end of such fiscal quarter and the related consolidated statements of income, retained
earnings and cash flows for such fiscal quarter and for the portion of Borrower’s fiscal
year ended at the end of such fiscal quarter, setting forth in each case in comparative
form, the figures for the corresponding fiscal quarter and the corresponding portion of
Borrower’s previous fiscal year, all in reasonable detail and satisfactory in form to Lender
and certified (subject to normal year-end adjustments and absence of footnote disclosures)
as to fairness of presentation, consistency and compliance with GAAP by the chief financial
officer of Borrower; provided, however, that delivery to Lender of copies of the Quarterly
Report on Form 10-Q of Borrower for such fiscal quarter filed with the Securities and
Exchange Commission shall be deemed to satisfy the requirements of this Section
5.01(a)(iii);




(iv) within the time frames outlined in Sections 5.01(a)(i) and 5.01(a)(iii) above, a
certificate of an authorized officer of Borrower in the form attached hereto as Exhibit
B and incorporated herein by reference (A) stating whether there exists on the date of
such certificate any Default or Event of Default and, if any Default or Event of Default
then exists, setting forth the details thereof and the action which Borrower is taking or
proposes to take with respect thereto, (B) certifying that all of the representations and
warranties made by Borrower in this Agreement and/or in any other Transaction Document are
true and correct in all material respects on and as of the date of such certificate as if
made on and as of the date of such certificate, and (C) setting forth the Consolidated
Capitalization Ratio for the relevant reporting period; and




(v) with reasonable promptness, such further information regarding the business, affairs and
financial condition of Borrower as Lender may from time to time reasonably request.



(b) Corporate Existence. Borrower will do all things necessary to (i) preserve and
keep in full force and effect at all times its corporate existence and all permits, licenses,
franchises and other rights material to its business and (ii) be duly qualified to do business and
be in good standing in all jurisdictions where the nature of its business or its ownership of
property or assets requires such qualification except for those jurisdictions in which the failure
to qualify or be in good standing could not reasonably be expected to have a Material Adverse
Effect.



(c) Compliance with Laws, Regulations, Etc. Borrower will comply with any and all
laws, ordinances and governmental and regulatory rules and regulations to which Borrower is subject
and obtain any and all licenses, permits, franchises and other governmental and regulatory
authorizations necessary to the ownership of its properties or assets or to the conduct of its
business, which violation or failure to obtain could reasonably be expected to have a Material
Adverse Effect.



(d) Further Assurances. Borrower will execute and deliver to Lender, at any time and
from time to time, any and all further agreements, documents and instruments, and take any and all
further actions which may be required under applicable law, or which Lender may from time to time
reasonably request, in order to effectuate the transactions contemplated by this Agreement and the
other Transaction Documents.



(e) Consolidation or Merger. Borrower will not directly or indirectly merge or
consolidate with or into any other Person.



(f) Stock and Assets of Subsidiaries. Unless the prior written consent of Lender is
obtained, Borrower will not create, incur or assume or suffer to be incurred or to exist any lien
on any of the common stock of LGC, Laclede Energy, SM&P, or any other Subsidiary, or on the
inventory or accounts receivable of LGC.



(g) Sale of Property. Borrower will not, and will not cause or permit any Subsidiary
to, (i) sell, assign, lease, transfer, abandon or otherwise dispose of any of its property
(including, without limitation, any shares of capital stock or other equity interests of a
Subsidiary owned by Borrower or another Subsidiary) or (ii) issue, sell or otherwise dispose of any
shares of capital stock or other equity interests of any Subsidiary; provided, however, that
Borrower and each Subsidiary may sell, assign, lease, transfer, abandon or otherwise dispose of (A)
any of its natural gas inventory or past-due accounts receivable in the ordinary course of
business, (B) any of its property to Borrower or any Subsidiary, provided that, if at anytime more
than Ten Percent (10%) of the consolidated assets of Borrower and all of its Subsidiaries are
transferred to a Subsidiary, such Subsidiary shall then execute a guaranty agreement with respect
to Borrower’s Obligations in a form reasonably acceptable to Lender, (C) any of its property
subject to LGC’s Mortgage and Deed of Trust dated as of February 1, 1945, as heretofore amended and
supplemented, as may be permitted to be sold, assigned, leased, transferred, abandoned or otherwise
disposed of under said Mortgage and Deed of Trust, (D) any of its other property (whether in one
transaction or a series of transactions) so long as the value of such property sold, assigned,
leased, transferred, abandoned or otherwise disposed of in any fiscal year under this subsection
(D) shall not exceed Ten Percent (10%) of the consolidated assets of Borrower and all of its
Subsidiaries as determined on a consolidated basis as of the last day of the immediately preceding
fiscal year, and (E) any shares of capital stock sold to Borrower by a Subsidiary; and provided
further, however, that nothing in this Agreement shall limit or restrict Borrower’s or any
Subsidiary’s use of financial instruments or natural gas contracts under their gas supply risk
management programs.



(h) Changes in Nature of Business. Borrower will not, and it will not cause or permit
any Subsidiary to, engage in any business if, as a result, the general nature of the business that
would then be engaged in by Borrower and its Subsidiaries, considered as a whole, would be
substantially changed from the general nature of the business engaged in by Borrower and its
Subsidiaries as of the date of this Agreement.



(i) Permitted Investments; Acquisitions. Borrower will not, and it will not cause or
permit any Subsidiary to, directly or indirectly, make any Investments except for Permitted
Investments. Borrower will not, and it will not cause or permit any Subsidiary to, directly or
indirectly, make any Acquisition the result of which would be to change substantially the general
nature of the business engaged in by Borrower and its Subsidiaries.



(j) Maximum Consolidated Capitalization Ratio. Borrower will at all times maintain a
Consolidated Capitalization Ratio of not more than Seventy Percent (70%).



(k) Subsidiaries. If Borrower creates, forms or acquires any Subsidiary which owns
more than Ten Percent (10%) of the consolidated assets of Borrower and all of its Subsidiaries on
or after the date of this Agreement, Borrower will, contemporaneously with the creation, formation
or acquisition of such Subsidiary, cause such Subsidiary to execute a guaranty agreement with
respect to Borrower’s Obligations in a form reasonably acceptable to Lender.



5.02 Use of Proceeds. Borrower covenants and agrees that (a) the proceeds of the Loan
will be used solely for general corporate purposes, (b) no part of the proceeds of the Loan will be
used in violation of any applicable law, rule or regulation and (c) no part of the proceeds of the
Loan will be used, whether directly or indirectly, and whether immediately, incidentally or
ultimately (i) to purchase or carry margin stock or to extend credit to others for the purpose of
purchasing or carrying margin stock, or to refund or repay indebtedness originally incurred for
such purpose or (ii) for any purpose which entails a violation of, or which is inconsistent with,
the provisions of any of the Regulations of The Board of Governors of the Federal Reserve System,
including, without limitation, Regulations U, T or X thereof, as amended.



SECTION 6. EVENTS OF DEFAULT.



If any of the following (each of the following herein sometimes called an “Event of
Default”) shall occur and be continuing:



6.01 Borrower shall fail to pay any of Borrower’s Obligations constituting interest, fees or
other amounts (other than principal due under the Loan) within ten (10) Business Days after the
date the same shall first become due and payable, whether by reason of demand, maturity,
acceleration or otherwise;



6.02 Any representation or warranty made by Borrower in this Agreement, in any other
Transaction Document or in any certificate, agreement, instrument or written statement furnished or
made or delivered pursuant hereto or thereto or in connection herewith or therewith, shall prove to
have been untrue or incorrect in any material respect when made or effected;



6.03 Borrower shall fail to perform or observe any term, covenant or provision contained in
Section 5.01(e) or Section 5.02;



6.04 Borrower shall fail to perform or observe any other term, covenant or provision contained
in this Agreement (other than those specified in Sections 6.01 or 6.02 above) and any such failure
shall remain unremedied for thirty (30) days after the earlier of (i) written notice of default is
given to Borrower by Lender or (ii) any officer of Borrower obtaining actual knowledge of such
default;



6.05 This Agreement or any of the other Transaction Documents shall at any time for any reason
(other than termination of this Agreement or such other Transaction Documents, as the case may be,
in accordance with its terms) cease to be in full force and effect or shall be declared to be null
and void by a court of competent jurisdiction, or if the validity or enforceability thereof shall
be contested or denied by Borrower, or if the transactions completed hereunder or thereunder shall
be contested by Borrower or if Borrower shall deny that it has any further liability or obligation
hereunder or thereunder;



6.06 Borrower shall (i) voluntarily commence any proceeding or file any petition seeking
relief under Title 11 of the United States Code or any other Federal, state or foreign bankruptcy,
insolvency, receivership, liquidation or similar law, (ii) consent to the institution of, or fail
to contravene in a timely and appropriate manner, any such proceeding or the filing of any such
petition, (iii) apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator or similar official of itself or of a substantial part of its property or assets, (iv)
file an answer admitting the material allegations of a petition filed against itself in any such
proceeding, (v) make a general assignment for the benefit of creditors, (vi) become unable, admit
in writing its inability or fail generally to pay its debts as they become due or (vii) take any
corporate or other action for the purpose of effecting any of the foregoing;



6.07 An involuntary proceeding shall be commenced or an involuntary petition shall be filed in
a court of competent jurisdiction seeking (i) relief in respect of Borrower, or of a substantial
part of the property or assets of Borrower, under Title 11 of the United States Code or any other
Federal, state or foreign bankruptcy, insolvency, receivership, liquidation or similar law, (ii)
the appointment of a receiver, trustee, custodian, sequestrator or similar official of Borrower or
of a substantial part of the property or assets of Borrower or (iii) the winding-up or liquidation
of Borrower, and such proceeding or petition shall continue undismissed for sixty (60) consecutive
days or an order or decree approving or ordering any of the foregoing shall continue unstayed and
in effect for sixty (60) consecutive days;



6.08 Borrower shall be declared by Lender to be in default under or in respect of (i) any
other present or future obligation to Lender, including, without limitation, any other loan, line
of credit, revolving credit, guaranty or letter of credit reimbursement obligation, or (ii) any
other present or future agreement purporting to convey to Lender a security interest in, or a lien
or encumbrance upon, upon any property or assets of Borrower;



6.09 The occurrence of any default or event of default under or within the meaning of any
agreement, document or instrument evidencing, securing, guaranteeing the payment of or otherwise
relating to any indebtedness of Borrower for borrowed money (other than the Borrower’s Obligations)
having an aggregate outstanding principal balance in excess of $10,000,000.00 that is not cured or
waived in writing within any applicable cure or grace period; or



6.10 Borrower shall have a judgment in an amount in excess of $15,000,000.00 entered against
it by a court having jurisdiction in the premises and such judgment shall not be appealed in good
faith (and execution of such judgment stayed during such appeal) or satisfied by Borrower within
thirty (30) days after the entry of such judgment;



THEN, and in each such event (other than an event described in Sections 6.06 or 6.07), Lender may
declare the entire outstanding principal balance of and all accrued and unpaid interest on the Note
and all of the other Borrower’s Obligations to be forthwith due and payable, whereupon all of the
unpaid principal balance of and all accrued and unpaid interest on the Note and all of such other
Borrower’s Obligations shall become and be immediately due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly waived by
Borrower, and Lender may exercise any and all other rights and remedies which it may have under any
of the other Transaction Documents or under applicable law; provided, however, that upon the
occurrence of any event described in Sections 6.06 or 6.07, the entire outstanding principal
balance of and all accrued and unpaid interest on the Note and all of the other Borrower’s
Obligations shall automatically become immediately due and payable, without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived by Borrower, and
Lender may exercise any and all other rights and remedies which it may have under any of the other
Transaction Documents or under applicable law.



SECTION 7. GENERAL.



7.01 No Waiver. No failure or delay by Lender in exercising any right, remedy, power
or privilege under this Agreement or under any other Transaction Document shall operate as a waiver
thereof; nor shall any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The rights and remedies
provided in this Agreement and in the other Transaction Documents are cumulative and not exclusive
of any remedies provided by law. Nothing herein contained shall in any way affect the right of
Lender to exercise any statutory or common law right of banker’s lien or set-off.



7.02 Right of Set-Off. Upon the occurrence and during the continuance of any Event of
Default, Lender is hereby authorized at any time and from time to time, without notice to Borrower
(any such notice being expressly waived by Borrower) and to the fullest extent permitted by law, to
set-off and apply any and all deposits (general or special, time or demand, provisional or final,
but specifically excluding any trust or segregated accounts) at any time held by Lender and any and
all other indebtedness at any time owing by Lender to or for the credit or account of Borrower
against any and all of the Borrower’s Obligations irrespective of whether or not Lender shall have
made any demand under this Agreement or under any of the other Transaction Documents and although
such obligations may be contingent or unmatured. Lender agrees to promptly notify Borrower after
any such set-off and application made by Lender, provided, however, that the failure to give such
notice shall not affect the validity of such set-off and application. The rights of Lender under
this Section 7.02 are in addition to any other rights and remedies (including, without limitation,
other rights of set-off) which Lender may have. Nothing contained in this Agreement or any other
Transaction Document shall impair the right of Lender to exercise any right of set-off or
counterclaim it may have against Borrower and to apply the amount subject to such exercise to the
payment of indebtedness of Borrower unrelated to this Agreement or the other Transaction Documents.



7.03 Cost and Expenses. Borrower agrees, whether or not any Loan is made under this
Agreement, to pay or reimburse Lender upon demand for (a) all out-of-pocket costs and expenses
incurred by Lender in connection with the preparation, documentation, negotiation and/or execution
of this Agreement and/or any of the other Transaction Documents, (b) all recording, filing and
search fees and expenses incurred by Lender in connection with this Agreement and/or any of the
other Transaction Documents, (c) all out-of-pocket costs and expenses (including, without
limitation, reasonable attorneys’ fees and expenses) incurred by Lender in connection with the (i)
the preparation, documentation, negotiation and execution of any amendment, modification,
extension, renewal or restatement of this Agreement and/or any of the other Transaction Documents
or (ii) the preparation of any waiver or consent under this Agreement or under any of the other
Transaction Documents and (d) if an Event of Default occurs, all out-of-pocket costs and expenses
(including, without limitation, reasonable attorneys’ fees and expenses) incurred by Lender in
connection with such Event of Default and collection and other enforcement proceedings resulting
therefrom. Borrower further agrees to pay or reimburse Lender upon demand for any stamp or other
similar taxes which may be payable with respect to the execution, delivery, recording and/or filing
of this Agreement and/or any of the other Transaction Documents. All of the obligations of
Borrower under this Section 7.03 shall survive the satisfaction and payment of the Borrower’s
Obligations and the termination of this Agreement.



7.04 General Indemnity. In addition to the payment of expenses pursuant to Section
7.03, whether or not the transactions contemplated hereby shall be consummated, Borrower hereby
agrees to defend, indemnify, pay and hold Lender any holders of the Note, and the officers,
directors, employees, agents and affiliates of Lender and such holders (collectively, the
“Indemnitees”) harmless from and against any and all other liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, disbursements, costs and expenses of
any kind or nature whatsoever (including, without limitation, the reasonable fees and disbursements
of counsel for such Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened, whether or not such Indemnitees shall be designated a party
thereto, provided that the Indemnitees shall share counsel to defend their interests to the extent
legally practicable), that may be imposed on, incurred by or asserted against the Indemnitees, in
any manner relating to or arising out of this Agreement, any of the other Transaction Documents or
any other agreement, document or instrument executed and delivered by Borrower in connection
herewith or therewith, the statements contained in any commitment letters delivered by Lender, the
agreement of Lender to make the Loans under this Agreement or the use or intended use of the
proceeds of any Loan under this Agreement (collectively, the “Indemnified Liabilities”);
provided that (a) the Indemnitees shall promptly (and in any event within fifteen (15)
Business Days after receiving notice of the existence of any potential Indemnified Liabilities)
notify Borrower in writing of the existence of any potential Indemnified Liabilities; (b) Borrower
shall have the right to assume and thereafter conduct the defense of any Indemnified Liabilities
with counsel of its choice reasonably satisfactory to the Indemnitees, provided that Borrower will
not consent to the entry of any judgment or enter into any settlement with respect to any
Indemnified Liabilities without the prior written consent of the Indemnitees (not to be
unreasonably withheld) unless the judgment or proposed settlement fully releases such Indemnitees
and involves only the payment of money damages that are covered in full by this indemnity and does
not impose an injunction or other equitable relief upon any Indemnitee and is subject to
confidentiality provisions acceptable to the Indemnitees (which approval will not be unreasonably
withheld by the Indemnitees); and (c) Borrower shall have no obligation to an Indemnitee hereunder
with respect to Indemnified Liabilities directly resulting from the gross negligence or willful
misconduct of that Indemnitee as determined by a court of competent jurisdiction in a final,
nonappealable order. To the extent that the undertaking to indemnify, pay and hold harmless set
forth in the preceding sentence may be unenforceable because it is violative of any law or public
policy, Borrower shall contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them. The provisions of the undertakings and indemnification set out in this
Section 7.04 shall survive satisfaction and payment of Borrower’s Obligations and the termination
of this Agreement.



7.05 Notices. Each notice, request, demand, consent, confirmation or other
communication under this Agreement shall be in writing and delivered in person or sent by facsimile
or registered or certified mail, return receipt requested and postage prepaid, to the applicable
party at its address or facsimile number set forth on the signature pages hereof, or at such other
address or facsimile number as any party hereto may designate as its address for communications
hereunder by notice so given. Such notices shall be deemed effective on the day on which delivered
or sent if delivered in person or sent by facsimile (with answerback confirmation received), or on
the fourth (4th) Business Day after the day on which mailed, if sent by registered or certified
mail.



7.06 Consent to Jurisdiction; Waiver of Jury Trial. BORROWER IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY MISSOURI STATE COURT SITTING IN THE COUNTY OF ST. LOUIS,
MISSOURI OR ANY UNITED STATES OF AMERICA COURT SITTING IN THE EASTERN DISTRICT OF MISSOURI, EASTERN
DISTRICT, AS LENDER MAY ELECT, IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT. BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT TO SUCH SUIT, ACTION OR PROCEEDING MAY BE HELD AND DETERMINED IN ANY OF SUCH COURTS.
BORROWER IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT BORROWER
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT, AND BORROWER FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. BORROWER AUTHORIZES
THE SERVICE OF PROCESS UPON BORROWER BY REGISTERED MAIL SENT TO BORROWER AT ITS ADDRESS DETERMINED
PURSUANT TO SECTION 7.05. BORROWER, AND LENDER HEREBY IRREVOCABLY WAIVE THE RIGHT TO TRIAL BY JURY
WITH RESPECT TO ANY ACTION IN WHICH BORROWER AND LENDER ARE PARTIES RELATING TO OR ARISING OUT OF
OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER TRANSACTION DOCUMENTS.



7.07 Governing Law. This Agreement shall be governed by and construed in accordance
with the substantive laws of the State of Missouri (without reference to conflict of law
principles).



7.08 Amendments and Waivers. Any provision of this Agreement, the Note or any of the
other Transaction Documents to which Borrower is a party may be amended or waived if, but only if,
such amendment or waiver is in writing and is signed by Borrower and Lender.



7.09 References; Headings for Convenience. Unless otherwise specified herein, all
references herein to Section numbers refer to Section numbers of this Agreement, all references
herein to Exhibits “A” and “B” refer to annexed Exhibits “A” and “B” that are
hereby incorporated herein by reference and all references herein to Schedule 2.02 refers
to annexed Schedule 2.02 that is hereby incorporated herein by reference. The Section
headings are furnished for the convenience of the parties and are not to be considered in the
construction or interpretation of this Agreement.



7.10 Successors and Assigns. The provisions of this Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors and assigns, except
that Borrower may not assign or otherwise transfer any of its rights or delegate any of its
obligations or duties under this Agreement.



7.11 NOTICE REQUIRED BY SECTION 432.047 R.S.Mo.; ENTIRE AGREEMENT This notice is
provided pursuant to Section 432.047 R.S.Mo. As used herein, “creditor” means Lender and “this
writing” means this Agreement and the other Transaction Documents. ORAL AGREEMENTS OR COMMITMENTS
TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO
EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS
BASED THAT IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT. TO PROTECT YOU (BORROWER(S)) AND US
(CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS
ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT
BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT. This Agreement embodies the
entire agreement and understanding between the parties hereto and supersedes all prior agreements
(including the Original Loan Agreement) and understandings (oral or written) relating to the
subject matter hereof.



7.12 Severability. In the event any one or more of the provisions contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way be affected or
impaired thereby.



7.13 Counterparts. This Agreement may be executed in any number of counterparts
(including facsimile counterparts), each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.



7.14 Confidentiality Any information received by Lender from Borrower and clearly
marked as confidential shall be treated as confidential by Lender in accordance with its customary
practices and procedures. Notwithstanding such agreement, nothing herein contained shall limit or
impair the right or obligation of Lender to disclose such information: (a) to its auditors,
attorneys, trustees, employees, directors, officers, advisors, affiliates or agents, (b) when and
as required by any law, ordinance, subpoena or governmental order, rule or regulation, (c) as may
be required, requested or otherwise appropriate in any report, statement or testimony submitted to
any municipal, state, provincial or federal regulatory body or any self-regulatory body having or
claiming to have jurisdiction over Lender, (d) which is publicly available or readily ascertainable
from public sources, or which is received by Lender from a third Person which or which is not known
by Lender to be bound to keep the same confidential, (e) in connection with any proceeding, case or
matter pending (or on its face purported to be pending) before any court, tribunal or any
governmental agency, commission, authority, board or similar entity, (f) in connection with
protection of its interests under this Agreement, the Note or any of the other Transaction
Documents, including, without limitation, the enforcement of the terms and conditions of this
Agreement, the Note and the other Transaction Documents, or (g) to any entity utilizing such
information to rate the creditworthiness of Lender or to rate or classify the debt or equity
securities of Lender or report to the public concerning the industry of which such Lender is a
part. It is agreed and understood that Lender shall not be liable to Borrower or any other Person
for failure to comply with the foregoing except in any case involving Lender’s gross negligence or
willful misconduct as determined by a court of competent jurisdiction in a final, nonappealable
order.



IN WITNESS WHEREOF, Borrower and Lender have executed this Agreement as of the day and year
first above written.



(SIGNATURES ON FOLLOWING PAGE)







1






SIGNATURE PAGE-

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT




Borrower:



THE LACLEDE GROUP, INC.



By:     



Print Name:     



Title:     



Address:



720 Olive Street, Suite 1525



St. Louis, Missouri 63101



Attention: Treasurer



Facsimile No.: (314) 421-1979



Lender:




U.S. BANK NATIONAL ASSOCIATION



By:     

John Holland, Senior Vice President




Address:



One US Bank Plaza, 12th Floor



St. Louis, Missouri 63101



Attention: Large Corporate Department



Facsimile No.: (314) 418-3571



2




SCHEDULE 2.02




Authorized Individuals




Douglas H. Yaeger



Barry C. Cooper



Ronald L. Krutzman



Lynn D. Rawlings



Denise T. Hicks



3




EXHIBIT A




AMENDED AND RESTATED REVOLVING CREDIT NOTE




	 	 	 
	$40,000,000.00

	 	St. Louis, Missouri

August 4, 2005






FOR VALUE RECEIVED, THE LACLEDE GROUP, INC., a Missouri corporation (“Borrower”),
hereby promises to pay to the order of U. S. BANK NATIONAL ASSOCIATION, a national banking
association (“Lender”), on the last day of the Revolving Credit Period, the principal sum
of Forty Million Dollars ($40,000,000.00), or such lesser sum as may then constitute the aggregate
unpaid principal amount of all Loans made by Lender to Borrower pursuant to the Agreement (defined
below). The aggregate principal amount of Revolving Credit Loans that Lender shall be committed to
have outstanding under this Amended and Restated Revolving Credit Note (this “Note”) at any
one time shall not exceed Forty Million Dollars ($40,000,000.00), which amount may be borrowed,
paid, reborrowed and repaid, in whole or in part, subject to the terms and conditions of this Note
and of the Agreement.



All payments received by Lender under this Note shall be allocated among the principal,
interest, collection costs and expenses and other amounts due under this Note in such order and
manner as Lender shall elect. The amount of interest accruing under this Note shall be computed on
an actual day, 360-day year basis.



All payments of principal and interest under this Note shall be made in lawful currency of the
United States in Federal or other immediately available funds at the office of Lender located at
One US Bank Plaza, 7th Street & Washington Avenue, 12th Floor, St. Louis,
Missouri 63101, or such other place as Lender may from time to time designate in writing.



This Note is the “Note” referred to in the Amended and Restated Revolving Credit Agreement
dated as of the date hereof by and between Borrower and Lender, as the same may from time to time
be amended, modified, extended, renewed or restated (the “Agreement”; all capitalized terms
used and not otherwise defined in this Note shall have the respective meanings ascribed to them in
the Agreement.). The Agreement, among other things, contains provisions for acceleration of the
maturity of this Note upon the occurrence of certain stated events and also for prepayments on
account of principal of this Note and interest on this Note prior to the maturity of this Note upon
the terms and conditions specified therein. This Note amends, restates and replaces the Revolving
Credit Note dated June 13, 2002, payable to the order of Lender, in the principal amount of up to
$20,000,000, and is not a novation thereof.



If Borrower shall fail to make any payment of any principal or interest due under this Note as
and when the same shall become due, then the entire outstanding principal balance of this Note and
all accrued and unpaid interest thereon may be declared to be immediately due and payable in the
manner and with the effect as provided in the Loan Agreement.



In the event that any payment of any principal or interest due under this Note is not paid
when due, whether by reason of maturity, acceleration or otherwise, and this Note is placed in the
hands of an attorney or attorneys for collection, or if this Note is placed in the hands of an
attorney or attorneys for representation of Lender in connection with bankruptcy or insolvency
proceedings relating to or affecting this Note, Borrower hereby promises to pay to the order of
Lender, in addition to all other amounts otherwise due on, under or in respect of this Note, the
costs and expenses of such collection and representation, including, without limitation, reasonable
attorneys’ fees and expenses (whether or not litigation shall be commenced in aid thereof).
Borrower hereby waives presentment for payment, demand for payment, protest, notice of protest and
notice of dishonor.



4



This Note shall be governed by and construed in accordance with the substantive laws of the
State of Missouri (without reference to conflict of law principles).



Borrower:



THE LACLEDE GROUP, INC.



By:     



Print Name:     




	 	 	 	Title:     





5




EXHIBIT B




[Date]



U.S. Bank National Association


One US Bank Plaza, 12th Floor


St. Louis, Missouri 63101


Attention: Large Corporate Division



Ladies and Gentlemen:



Reference is hereby made to the Amended and Restated Revolving Credit Agreement dated as of
August 4, 2005, by and between The Laclede Group, Inc. and U.S. Bank National Association, as the
same may from time to time amended, modified, extended, renewed or restated (the
“Agreement”). All capitalized terms used and not otherwise defined herein shall have the
respective meanings ascribed to them in the Agreement.



Borrower hereby certifies to Lender that as of the date hereof:



(a) except as set forth below, all of the representations and warranties made by Borrower in
the Agreement and/or in any of the other Transaction Documents are true and correct in all material
respects on and as of the date of this Certificate as if made on and as of the date of this
Certificate:



Exceptions: ;



(b) except as set forth below, no Default or Event of Default under or within the meaning of
the Agreement has occurred and is continuing:



Exceptions: ; and



(c) the financial statements of Borrower and its Subsidiaries made available to you are true,
correct and complete in all material respects and have been prepared in accordance with GAAP
(subject, in the case of any interim financial statements, to normal year-end adjustments and
absence of footnote disclosures).



(d) Borrower had a Consolidated Capitalization Ratio of not more than Seventy Percent (70%) at
all times during the period commencing      , 200_, and ending      , 200_.



Very truly yours,



THE LACLEDE GROUP, INC.



By:     



Print Name:     



Title:     




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