Exhibit
10.2


 


WAIVER


 


This WAIVER (“Waiver”),
dated as of August 19, 2009, is by and among PINNACLE GAS
RESOURCES, INC., a Delaware  corporation,
the Lenders from time to time party hereto, and THE ROYAL
BANK OF SCOTLAND plc, as Administrative Agent and as Lender.


 


WHEREAS, the Borrower, the
Lenders and the Administrative Agent are parties to that certain Credit
Agreement (as amended by that certain Letter Regarding Waiver and Amendment to
Credit Agreement dated March 9, 2007, the Second Amendment to Credit Agreement
dated as of August 4, 2008, the Third Amendment to Credit Agreement dated
as of September 30, 2008, the Fourth Amendment to Credit Agreement dated
as of April 14, 2009, and as further amended and supplemented from time to
time, the “Credit Agreement); and


 


WHEREAS, the Borrower has
requested a waiver under the Credit Agreement in certain respects as set forth
herein;


 


NOW THEREFORE, in
consideration of the premises and the mutual covenants, representations and
warranties contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:


 


AGREEMENT


 


Section 1.               Definitions.  Capitalized
terms used herein but not defined herein shall have the meanings as given them
in the Credit Agreement, unless the context otherwise requires.


 


Section 2.               Waiver.  The
Administrative Agent and the Lenders hereby waive for the period ending August 26,
2009, the requirement in Section 7.15.2 of the Credit Agreement that
the Borrower not permit the ratio of its Current Assets to its Current
Liabilities to be less than 1.00 to 1.00 for the fiscal quarter ending June 30,
2009.  The waiver in this Section 2
is effective only in respect to such requirement in such Section 7.15.2
and only for the period ending August 26, 2009 and only for the
fiscal quarter ending June 30, 2009, and not any other period or fiscal
quarter and not a waiver of any other provision of the Credit Agreement.  Except as expressly set forth in this Section 2,
the execution, delivery, performance and effectiveness of this Waiver shall not
operate nor be deemed to be nor construed as a waiver (i) of any right,
power or remedy of the Administrative Agent or any Lender under the Credit
Agreement or any of the other Loan Documents, (ii) of any other term,
provision, representation, warranty, covenant or event of default contained in
the Credit Agreement, any other Loan Documents or any other instruments or
documents executed in connection therewith and the Administrative Agent and the
Lenders hereby expressly reserve all such rights, powers and remedies.


 


Section 3.               Conditions to Effectiveness. 
This Waiver shall be deemed effective as of June 29, 2009 (the “Effective
Date”) following the satisfaction of the following condition:


 


(a)           the Administrative Agent shall have received
counterparts hereof duly executed by the Borrower, the Administrative Agent,
and the Required Lenders;


 

















 


Section 4.               Representations and Warranties. 
The Borrower hereby represents and warrants that after giving effect
hereto:


 


(a)           the representations and warranties of the Borrower and
each Subsidiary contained in the Loan Documents are true and correct in all
material respects on and as of the date hereof, other than those representations
and warranties that expressly relate solely to a specific earlier date, which
shall remain correct in all material respects as of such earlier date;


 


(b)           the execution, delivery and performance by the
Borrower and each Subsidiary of this Waiver has been duly authorized by all
necessary corporate action required on their part and this Waiver constitutes
the legal, valid and binding obligation of each Obligor party thereto
enforceable against them in accordance with its terms, except as its
enforceability may be affected by the effect of bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting the rights or remedies of creditors generally;


 


(c)           neither the execution, delivery and performance of
this Waiver by the Borrower and each Subsidiary, the performance by them of the
Credit Agreement nor the consummation of the transactions contemplated hereby
does or shall contravene, result in a breach of, or violate (i) any
provision of the Borrower or any Subsidiary’s certificate or articles of
incorporation or bylaws or other similar documents, or agreements, (ii) any
law or regulation, or any order or decree of any court or government
instrumentality, or (iii) any indenture, mortgage, deed of trust, lease,
agreement or other instrument to which the Borrower or any of its Subsidiaries
is a party or by which the Borrower or any of its Subsidiaries or any of their
property is bound, except in any such case to the extent such conflict or
breach has been waived herein or by a written waiver document, a copy of which
has been delivered to Administrative Agent on or before the date hereof;


 


(d)           no Material Adverse Effect has occurred and is
continuing; and


 


(e)           no Default or Event of Default that the Administrative
Agent and the Lenders have not waived in writing or that has not otherwise been
disclosed to the Administrative Agent has occurred and is continuing.


 


Section 5.               Costs and Expenses.  As provided
in Section 9.4 of the Credit Agreement, the Borrower agrees to
reimburse Administrative Agent for all fees, costs, and expenses, including the
reasonable fees, costs, and expenses of counsel or other advisors for advice,
assistance, or other representation in connection with this Waiver.


 


Section 6.               GOVERNING LAW. THIS WAIVER HAS BEEN
NEGOTIATED, IS BEING EXECUTED AND DELIVERED, AND WILL BE PERFORMED IN WHOLE OR
IN PART, IN THE STATE OF NEW YORK, AND THE SUBSTANTIVE LAWS OF SUCH STATE AND
THE APPLICABLE FEDERAL LAWS OF THE UNITED STATES OF AMERICA SHALL GOVERN THE
VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION OF THE LOAN DOCUMENTS,
EXCEPT TO THE EXTENT THE LAWS OF ANY JURISDICTION WHERE COLLATERAL IS 


 


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LOCATED
REQUIRE APPLICATION OF SUCH LAWS WITH RESPECT TO SUCH COLLATERAL.


 


Section 7.               Severability. 
Any provision of this Waiver that is prohibited or unenforceable in any
jurisdiction shall, as to such provision and such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions of this Waiver or affecting the validity or enforceability
of such provision in any other jurisdiction.


 


Section 8.               Counterparts. 
This Waiver may be executed in any number of counterparts, all of which
taken together shall constitute one and the same instrument, and any party
hereto may execute this Waiver by signing one or more counterparts.  Any signature hereto delivered by a party by
facsimile transmission shall be deemed to be an original signature hereto.


 


Section 9.               No Waiver.  Except as
expressly set forth in this Waiver, the execution, delivery and effectiveness
of this Waiver shall not operate as a waiver of any default of the Borrower or
any other Obligor or any right, power or remedy of the Administrative Agent or
the other Secured Parties under any of the Loan Documents, nor constitute a
waiver of any provision of any of the Loan Documents.


 


Section 10.             Successors
and Assigns.  This Waiver shall be binding upon the
Borrower and its successors and permitted assigns and shall inure, together
with all rights and remedies of each Lender hereunder, to the benefit of each
Lender and the respective successors, transferees and assigns.


 


Section 11.             Entire Agreement. 
THIS WAIVER CONSTITUTES THE ENTIRE AGREEMENT BETWEEN THE PARTIES HERETO
WITH RESPECT TO THE SUBJECT HEREOF AND SHALL SUPERSEDE ANY PRIOR AGREEMENT
BETWEEN THE PARTIES HERETO, WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT
HEREOF.  FURTHERMORE, IN THIS REGARD,
THIS AGREEMENT  REPRESENTS THE FINAL
AGREEMENT AMONG THE PARTIES THERETO AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF SUCH
PARTIES.


 


THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG SUCH
PARTIES.


 


[Signature Pages Follow]


 


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IN WITNESS WHEREOF, the
parties hereto have caused this Waiver to be duly executed and delivered by
their respective duly authorized officers as of the date hereof.


 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  PINNACLE
  GAS RESOURCES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Peter G. Schoonmaker

  
	
   

  	
  Name:

  	
  Peter
  G. Schoonmaker

  
	
   

  	
  Title:

  	
  Chief
  Executive Officer and President

  
				



 


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  ADMINISTRATIVE
  AGENT:

  
	
   

  	
   

  
	
   

  	
  THE
  ROYAL BANK OF SCOTLAND plc,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  P. R. Ballard

  
	
   

  	
  Name:

  	
  P.
  R. Ballard

  
	
   

  	
  Title:

  	
  Managing
  Director

  
				



 


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  LENDER:

  
	
   

  	
   

  
	
   

  	
  THE
  ROYAL BANK OF SCOTLAND plc,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  P. R. Ballard

  
	
   

  	
  Name:

  	
  P.
  R. Ballard

  
	
   

  	
  Title:

  	
  Managing
  Director

  
				



 


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