Document:

exv10w1

Exhibit 10.1

FIRST AMENDMENT

TO

LOAN AND SECURITY AGREEMENT

     THIS FIRST AMENDMENT to Loan and Security Agreement (this “Amendment”) is entered into this
22nd day of July, 2008, by and between Silicon Valley Bank (“Bank”) and ENDOLOGIX, INC., a
Delaware corporation (“Borrower”) whose address is 11 Studebaker, Irvine, CA 92618.

Recitals

     A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as
of February 21, 2007 (as the same may from time to time be further amended, modified,
supplemented or restated, the “Loan Agreement”).

     B. Bank has extended credit to Borrower for the purposes permitted in the Loan Agreement.

     C. Borrower has requested that Bank amend the Loan Agreement to (i) extend additional
credit, (ii) extend the maturity date, (iii) revise the financial covenants, and (iv) make certain
other revisions to the Loan Agreement as more fully set forth herein.

     D. Bank has agreed to so amend certain provisions of the Loan Agreement, but only to the
extent, in accordance with the terms, subject to the conditions and in reliance upon the
representations and warranties set forth below.

Agreement

     Now, Therefore, in consideration of the foregoing recitals and other good and
valuable consideration, the receipt and adequacy of which is hereby acknowledged, and
intending to be legally bound, the parties hereto agree as follows:

     1. Definitions. Capitalized terms used but not defined in this Amendment shall have the
meanings given to them in the Loan Agreement.

     2. Amendments to Loan Agreement.

          2.1 Section 2.1.4 (Term Advances) New Section 2.1.4 is hereby added as follows:

          “2.1.4 Term Advances.

               (a) Availability. Subject to the terms and conditions of this
Agreement,
during the Draw Period, Bank shall make advances (each, a “Term Advance” and, collectively, “Term
Advances”) not exceeding the Term Line. Each Term Advance shall be in an amount not less than One
Million Dollars ($1,000,000), except for the final Term Advance which shall have no minimum. After
repayment, no Term Advance may be reborrowed.

               (b) Repayment. Term Advances outstanding on the last day of the Draw
Period are payable in (i) thirty six (36) consecutive equal monthly installments of principal
plus (ii)
monthly payments of accrued interest, beginning on April 30, 2009 and continuing on the last
day of each
month thereafter through the Term Maturity Date.”

          2.2 Section 2.3 (Interest Rates). Section 2.3(a) is amended and restated in its entirety as follows:

               “(a) Interest Rates.

 

 

                    (i) Subject to Section 2.3(b), the principal amount
outstanding under the Revolving Line shall accrue interest at a floating per annum
rate equal to one half of one percentage point (0.50%) above the Prime Rate, which
interest shall be payable monthly in accordance with Section 2.3(f) below.

                    (ii) Term Advances. Subject to Section 2.3(b), the principal amount outstanding under the Term Line shall accrue interest at a per annum
rate equal to one percentage point (1.00%) above the Prime Rate which interest shall be
payable monthly in accordance with Section 2.3(f) below.”

          2.3 Section 6.7 (Financial Covenants). Section 6.7 is amended and restated in its
entirety as follows:

               “6.7 Financial Covenants.

                    Borrower shall maintain, at all times to be tested, as of the last day of each month, unless
otherwise noted:

                    (a) Liquidity Ratio. A ratio of (i) Cash at Bank
(excluding any
restricted cash) plus availability under the Revolving Line to (ii) all amounts owing from Borrower
to Bank under the Term Line of at least 1.50 to 1.00.

                    (b) Tangible Net Worth. A Tangible Net Worth of at
least
Thirteen Million Dollars ($13,000,000), which amount shall be increased by fifty percent (50%) of
issuances of equity (other than issuances under Borrower’s equity compensation plans) or
Subordinated Debt received after July 22, 2008 in the month following such issuance and by fifty
percent (50%) of Net Income in the first month following the calendar quarter which Net Income is
earned.”

          2.4 Section 13 (Definitions). The following terms and their respective definitions
set forth in Section 13.1 are added or amended in their entirety and replaced with the
following:

               “Credit Extension” is any Advance, FX Forward Contract,
amount utilized for Cash Management Services, Term Advance or any other extension of
credit by Bank for Borrower’s benefit.

               “Draw Period” is the period of time from July 22, 2008 through the
earlier to occur of (a) March 31, 2009, or (b) an Event of Default.

               “Revolving Maturity Date” means July 22, 2010.

               “Term Advance” is defined in Section 2.1.4(a).

               “Term Line” is an Term Advance or Term Advances in an aggregate amount of up to Three Million
Dollars ($3,000,000).

               “Term Maturity Date” is March 31, 2012.

          2.5 Exhibit D is hereby replaced with Exhibit D attached hereto.

     3. Limitation of Amendments.

          3.1 The amendments set forth in Section 2, above, are effective for the purposes set forth
herein and shall be limited precisely as written and shall not be deemed to (a) be a consent to
any amendment, waiver or modification of any other term or condition of any Loan Document, or (b)
otherwise

2

 

prejudice any right or remedy which Bank may now have or may have in the future under or in
connection with any Loan Document.

          3.2 This Amendment shall be construed in connection with and as part of the Loan Documents
and all terms, conditions, representations, warranties, covenants and agreements set forth in the
Loan Documents, except as herein amended, are hereby ratified and confirmed and shall remain in
full force and effect.

     4. Representations and Warranties. To induce Bank to enter into this Amendment,
Borrower hereby represents and warrants to Bank as follows:

          4.1 Immediately after giving effect to this Amendment (a) the representations and
warranties contained in the Loan Documents are true, accurate and complete in all material
respects as of
the date hereof (except to the extent such representations and warranties relate to an earlier
date, in which
case they are true and correct as of such date), and (b) no Event of Default has occurred and
is continuing;

          4.2 Borrower has the power and authority to execute and deliver this Amendment
and to perform its obligations under the Loan Agreement, as amended by this Amendment;

          4.3 The organizational documents of Borrower delivered to Bank on the Effective
Date remain true, accurate and complete and have not been amended, supplemented or restated
and are and
continue to be in full force and effect;

          4.4 The execution and delivery by Borrower of this Amendment and the
performance by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment,
have been duly authorized;

          4.5 The execution and delivery by Borrower of this Amendment and the
performance by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do
not and will not contravene (a) any law or regulation binding on or affecting Borrower, (b)
any contractual
restriction with a Person binding on Borrower, (c) any order, judgment or decree of any court
or other
governmental or public body or authority, or subdivision thereof, binding on Borrower, or (d)
the
organizational documents of Borrower;

          4.6 The execution and delivery by Borrower of this Amendment and the
performance by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do
not require any order, consent, approval, license, authorization or validation of, or filing,
recording or
registration with, or exemption by any governmental or public body or authority, or
subdivision thereof,
binding on either Borrower, except as already has been obtained or made; and

          4.7 This Amendment has been duly executed and delivered by Borrower and is the
binding obligation of Borrower, enforceable against Borrower in accordance with its terms,
except as such
enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation,
moratorium or other
similar laws of general application and equitable principles relating to or affecting
creditors’ rights.

     5. Counterparts. This Amendment may be executed in any number of counterparts and all
of such counterparts taken together shall be deemed to constitute one and the same instrument.

     6. Effectiveness. This Amendment shall be deemed effective upon (a) the due execution
and delivery to Bank of this Amendment by each party hereto, (b) the due execution and
delivery to Bank
of borrowing resolutions for Borrower and (c) Borrower’s payment of a loan fee in the amount
equal to
Fifteen Thousand Dollars ($15,000) with respect to the Term Line and loan fee in an amount
equal to
Seventeen Thousand Seven Hundred Eight Dollars ($17,708) with respect to the Revolving Line.

[Signature page follows.]

3

 

     In Witness Whereof, the parties hereto have caused this Amendment to be duly executed
and delivered as of the date first written above.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	BANK	 	 	 	BORROWER	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Silicon Valley Bank	 	 	 	Endologix, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:	 	/s/ Victor Le	 	 	 	By:	 	/s/ ROBERT J. KRIST	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	Victor Le
	 	 	 	 	 	Name:
	 	ROBERT J. KRIST	 	 
	 

	 	Title:
	 	Relationship Manager
	 	 	 	 	 	Title:
	 	Chief Financial Officer	 	 

 

 

BORROWING RESOLUTIONS

	 	 	 
	

	 	Silicon Valley Bank

CORPORATE BORROWING CERTIFICATE

	 	 	 
	Borrower: Endologix, Inc.

	 	Date: July 22, 2008
	Bank:           Silicon Valley Bank
	 	 

I hereby certify as follows, as of the date set forth above:

A. I am the Secretary, Assistant Secretary or other officer of Borrower. My
title is as set forth
below.

B. Borrower’s exact legal name is set forth above. Borrower is a corporation
existing under the laws
of the State of Delaware.

C. Attached hereto are true, correct and complete copies of Borrower’s
Certificate of Incorporation
(including amendments), as filed with the Secretary of State of the state in
which Borrower is incorporated
as set forth in paragraph 1 above. Such Certificate of Incorporation have not
been amended, annulled,
rescinded, revoked or supplemented, and remain in full force and effect as of the
date hereof.

D. The following resolutions were duly and validly adopted by Borrower’s Board of
Directors at a
duly held meeting of such directors (or pursuant to a unanimous written consent
or other authorized
corporate action). Such resolutions are in full force and effect as of the date
hereof and have not been in
any way modified, repealed, rescinded, amended or revoked, and Bank may rely on
them until Bank
receives written notice of revocation from Borrower.

Resolved, that any one of the following officers or employees of
Borrower, whose names, titles and signatures are below, may act on behalf
of Borrower:

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Authorized
	 	 	 	 	 	 	to Add or Remove
	Name	 	Title	 	Signature	 	Signatories
	 
	 	 	 	 	 	 
	JOHN McDERMOTT

	 	CEO
	 	/s/ JOHN McDERMOTT
	 	þ
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	BOB KRIST

	 	CFO & Secretary
	 	/s/ BOB KRIST
	 	þ
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	o
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	o
	 

	 	 
	 	 
	 	 

Resolved Further, that any one of the persons designated above
with a checked box beside his or her name may, from time to time, add or
remove any individuals to and from the above list of persons authorized to
act on behalf of Borrower.

Resolved Further, that such individuals may, on behalf of Borrower:

 

 

Borrow
Money. Borrow money from Silicon Valley Bank (“Bank”).

Execute Loan Documents. Execute any loan documents Bank requires.

Grant Security. Grant Bank a security interest in any of Borrower’s assets.

Negotiate Items. Negotiate or discount all drafts, trade
acceptances, promissory notes, or other indebtedness in which Borrower has an interest and receive cash or otherwise use the proceeds.

Letters of Credit. Apply for letters of credit from Bank.

Foreign Exchange Contracts. Execute spot or forward foreign exchange contracts.

Further Acts. Designate other individuals to request advances, pay fees and costs and execute other documents or agreements (including documents or agreement that waive Borrowers right to a jury trial) they believe to be necessary to effectuate such resolutions.

     Resolved
Further, that all acts authorized by the above resolutions and any prior
acts relating thereto are ratified.

E. The persons listed above are Borrower’s officers or employees with their titles and signatures
shown next to their names.

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ ROBERT J. KRIST
 	 
	 	 	Name:  	ROBERT J. KRIST 	 
	 	 	Title:  	CFO & SECRETARY 	 
	 

     *** If the Secretary, Assistant Secretary or other certifying officer executing above is
designated by the resolutions set forth in paragraph 4 as one of the authorized signing officers,
this Certificate must also be signed by a second authorized officer or director of Borrower.

     I, the Chief Executive of Borrower, hereby certify as to paragraphs 1 through 5 above, as of the date set forth above.

     [print title]

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ JOHN McDERMOTT
 	 
	 	 	Name:  	JOHN McDERMOTT 	 
	 	 	Title:  	CEOexv10wxvyw9

Exhibit 10(v)-9

FIRST AMENDMENT TO AMENDED AND RESTATED

CREDIT AGREEMENT

     THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) is made and
entered into effective as of July 25, 2008, by and among ENERGYSOUTH, INC., a Delaware corporation
(the “Parent Borrower”), BAY GAS STORAGE COMPANY, LTD., an Alabama limited partnership (the
“Subsidiary Borrower”, and together with the Parent Borrower, the “Borrowers”), the several banks
and other financial institutions and lenders from time to time party to the Credit Agreement
referred to below (the “Lenders”), and REGIONS BANK, in its capacity as administrative agent for
the Lenders (the “Administrative Agent”).

W I T N E S S E T H:

     WHEREAS, the Borrowers, the Lenders, and the Administrative Agent are parties to a certain
Amended and Restated Credit Agreement, dated as of November 28, 2007 (the “Credit Agreement”),
pursuant to which the Lenders have made certain financial accommodations available to the
Borrowers; and

     WHEREAS, the Borrowers have requested that the Lenders agree (i) to amend the Credit Agreement
so as to (x) include certain provisions in the Credit Agreement with respect to increases in the
total ESI Commitments in effect from time to time under the Credit Agreement, (y) increase the
permitted Leverage Ratio for periods ending on or after July 31, 2008, and (z) make certain other
modifications to the Credit Agreement as set forth herein, and (ii) to waive certain prepayment
requirements and certain financial statement reporting requirements for the fiscal quarters of the
Parent Borrower ended December 31, 2007, March 31, 2008, and June 30, 2008, all as more
particularly provided in this Amendment, and subject to the terms and conditions hereof, the
Lenders are willing to agree to such amendments and waivers;

     NOW, THEREFORE, for good and valuable consideration, the sufficiency and receipt of all of
which are acknowledged, the Borrowers, the Lenders and the Administrative Agent agree as follows:

     SECTION 1. Definitions. Capitalized terms used but not defined in this Amendment have the meanings
assigned to such terms in the Credit Agreement.

     SECTION 2. Amendments to Section 1.1 (“Definitions”).

     (a) Section 1.1 of the Credit Agreement is hereby amended by deleting the definition
for the term “ESI Commitment” in its entirety and substituting in lieu thereof the following
definition:

     “ESI Commitment” shall mean, with respect to each ESI Lender, the obligation of such
ESI Lender to make ESI Revolving Loans to the Parent Borrower and to participate in ESI LCs
and Swingline Loans in an aggregate principal amount not

 

 

exceeding the amount set forth with
respect to such ESI Lender on Schedule 1.1-C, or in the case of a Person becoming an
ESI Lender after the Closing Date, the amount of the assigned “ESI Commitment” as provided
in the Assignment and Acceptance executed by such Person as an assignee, or in the case of a
Consenting Lender or an Additional Lender becoming an ESI Lender pursuant to Section
2.24, the amount of such Consenting Lender’s or Additional Lender’s ESI Commitment as
agreed pursuant to Section 2.24(b)(i), as the case may be, in each case as the same
may be changed pursuant to the terms hereof.

     (b) Section 1.1 of the Credit Agreement is hereby further amended by replacing the
references to the term “Level VII” in the first sentences of the definitions of “Applicable Margin”
and “Applicable Percentage”, respectively, with references to “Level X.”

     (c) Section 1.1 of the Credit Agreement is hereby further amended by deleting
paragraph (b) of the definition of “Net Proceeds” in its entirety and substituting in lieu thereof
the following paragraph (b):

     (b) with respect to any Debt Issuance or Equity Issuance, the cash proceeds
received by the Parent Borrower and any of its Subsidiaries in respect of such Debt
Issuance or Equity Issuance, including any cash received in respect of any non-cash
proceeds, but only as and when received, in each case net of actual costs and
expenses incurred in connection with such issuance, including without limitation,
legal, accounting and investment banking fees, discounts, consultant and advisory
fees, and sales commissions; provided, however, that there shall be
excluded from such Net Proceeds any cash proceeds received from any Equity Issuance
effected pursuant to the Parent Borrower’s dividend reinvestment and stock purchase
plan up to an aggregate amount of $500,000 in any twelve (12) month period.

     (d) Section 1.1 of the Credit Agreement is hereby further amended by adding, in
appropriate alphabetical order, the definitions for “Additional Lender” and “Consenting Lender” and
“Merger Agreement”, as follows:

     “Additional Lender” shall have the meaning provided in Section 2.24(a).

     “Consenting Lender” shall have the meaning provided in Section 2.24(a).

     “Merger Agreement”shall mean the Agreement and Plan of Merger dated as of July 25,
2008, among the Parent Borrower, Sempra Energy, a California corporation, and EMS Holdings
Corp., a Delaware corporation.

     SECTION 3. Amendment to Section 2.12 (“Mandatory Prepayments and Commitment Reductions”).
Section 2.12 of the Credit Agreement is hereby amended by adding the following paragraph
at the end of subsection (b) of such Section 2.12 as follows:

     Notwithstanding the foregoing, in the event and on each occasion that the Parent
Borrower receives any Net Proceeds from an Equity Issuance subsequent to July 25, 2008, the
Parent Borrower shall, within five (5) Business Days after such Net Proceeds

2

 

are received, make and apply the payments as described in the immediately following sentence (and not as
otherwise provided in the first sentence of Section 2.12(h)(2) below) in an
aggregate amount not less than the sum of (i) 100% of the first $60,000,000 of all such Net
Proceeds; (ii) 100% of such additional amount of all such Net Proceeds as may be necessary
for the Parent Borrower to satisfy (on a pro forma basis giving effect to the receipt and
application of such Net Proceeds against the ESI Credit Facility as provided herein) the
maximum Leverage Ratio as applicable following such Equity Issuance pursuant to Section
6.1, and (iii) 50% of any additional amount of all such Net Proceeds remaining after the
requirements of the preceding clauses (i) and (ii) have been met; provided,
however, that solely with respect to any prepayment otherwise required by the
preceding clause (iii), the Parent Borrower may, at its option in lieu of such prepayment
pursuant to clause (iii), elect to apply all or a portion of such prepayment as an
investment in the Subsidiary Borrower to the extent, and in the same manner, as permitted
pursuant to the “proviso” in clause (ii) in the immediately preceding paragraph in this
Section 2.12(b). Any required prepayments pursuant to this paragraph shall be
applied solely against the ESI Credit Facility, and shall cause an automatic reduction in
the Aggregate ESI Commitments as provided in Section 2.12(e) below.

     SECTION 4. Amendment to Section 2.13 (“Interest on Loans”). Section 2.13 of the
Credit Agreement is hereby amended by deleting subsection (c) thereof in its entirety and
substituting the following subsection (c):

     (c) While an Event of Default exists or after acceleration, at the option of the
Required Lenders, the Borrowers shall pay interest (“Default Interest”) with respect to all
Eurodollar Loans at the rate otherwise applicable for the then-current Interest Period plus
an additional 5% per annum until the last day of such Interest Period, and thereafter, and
with respect to all Base Rate Loans (including all Swingline Loans) and all other
Obligations hereunder (other than Loans), at the rate for Base Rate Loans, plus the
Applicable Margin and an additional 5% per annum; provided, however, that if
such Event of Default continues to exist, or such acceleration remains in effect, in any
case for a period longer than 30 days, then such Default Interest shall be increased by an
additional 1% per annum at the end of each 30-day interval from the initial date of such
Event of Default or acceleration, as the case may be (so that, for example, such additional
Default Interest shall be 5% per annum during the first 30-day interval, 6% per annum during
the second 30-day interval, and increasing similarly thereafter during each subsequent
30-day interval).

     SECTION 5. Amendment to Article II (“Amounts and Terms of the Credit Facilities”). Article II of
the Credit Agreement is hereby amended by adding a new Section 2.24 at the end of Article
II as follows:

     SECTION 2.24 Increase of ESI Commitments; Additional Lenders.

     (a) The Parent Borrower shall have the right to cause from time to time an
increase in the total ESI Commitments of the ESI Lenders by adding to this Agreement
one or more additional ESI Lenders (each an “Additional Lender”) or by allowing one
or more ESI Lenders (each a “Consenting Lender”)

3

 

to increase their respective ESI
Commitments; provided however that (i) no such increased or
additional ESI Commitments shall take effect unless at the time of such
effectiveness, (x) the Merger Agreement has not been terminated and is in full force
and effect, and (y) no Event of Default shall have occurred hereunder which is
continuing or shall result therefrom, (ii) the aggregate amount of all such
increased and additional ESI Commitments pursuant to this Section 2.24(a)
shall not exceed $30,000,000, and (iii) no ESI Lender’s ESI Commitment shall be
increased without such ESI Lender’s written agreement.

     (b) An increase in the aggregate amount of the ESI Commitments pursuant to this
Section 2.24 shall become effective upon the receipt by the Administrative
Agent of (i) an agreement in form and substance satisfactory to the Administrative
Agent signed by the Borrowers, by each Additional Lender and by each Consenting
Lender, setting forth the new ESI Commitments of such Lenders and setting forth the
agreement of each Additional Lender to become a party to this Agreement and to be
bound by all the terms and provisions hereof, together with such evidence of
appropriate authorization on the part of the Parent Borrower with respect to the
increase in the ESI Commitments and such opinions of counsel for the Parent Borrower
with respect to the increase in the ESI Commitments as the Administrative Agent may
reasonably request, and (ii) Notes executed and delivered by the Parent Borrower for
each Consenting Lender and each Additional Lender requesting the same, evidencing
such Lenders’ ESI Commitments.

     (c) Upon the acceptance of any such agreement by the Administrative Agent, the
total ESI Commitments shall automatically be increased by the amount of the ESI
Commitments added through such agreement and Schedule 1.1-C shall
automatically be deemed amended to reflect the ESI Commitments of all Lenders after
giving effect to such additional ESI Commitments and Additional Lenders, as
applicable.

     (d) Upon any increase in the aggregate amount of the ESI Commitments pursuant
to this Section 2.24 that is not pro rata among all ESI Lenders, (x) the
Parent Borrower shall promptly prepay all outstanding ESI Borrowings in their
entirety (including all accrued and unpaid interest thereon and any amounts payable
pursuant to Section 2.19 with respect to such payments) through new ESI
Borrowings pursuant to Section 2.3 from the ESI Lenders (including any
Additional Lenders) in proportion to their respective ESI Commitments after giving
effect to such increase, such that all outstanding ESI Borrowings are held by the
ESI Lenders (including any Additional Lenders) in such proportion and (y) effective
upon such increase, the amount of the participations held by the ESI Lenders
(including any Additional Lenders) in the Aggregate ESI LC Exposure and all
Swingline Loans outstanding shall be adjusted such that, after giving effect to such adjustments, each ESI Lender
(including each Additional Lender) shall hold participations in such Aggregate ESI
LC Exposure and all Swingline Loans in the proportion its respective ESI Commitment
bears to the aggregate ESI Commitments after giving effect to such

4

 

increase. The Administrative Agent and the Lenders hereby agree that the minimum borrowing, pro
rata borrowing and pro rata payment requirements contained elsewhere in this
Agreement shall not apply to the transactions effected pursuant to the immediately
preceding sentence.

     SECTION 6. Amendment to Article V (“Affirmative Covenants”). Article V of the Credit
Agreement is hereby amended by adding a new Section 5.11 (“Equity Issuance”) as follows:

     Section 5.11. Equity Issuance. If the Merger Agreement is terminated,
cancelled or otherwise fails to continue in effect at any time after July 25, 2008, then the
Parent Borrower shall, within two weeks after the date of such termination, cancellation or
other discontinuation of effectiveness (the “Merger Termination Date”), have engaged one or
more investment banks approved by the Administrative Agent (such approval not to be
unreasonably withheld or delayed) to publicly sell or privately place Capital Stock of the
Parent Borrower, or have received an offer letter from one or more private equity investors
for the purchase of Capital Stock of the Parent Borrower, in any such case so as to result
in the receipt by the Parent Borrower, not later than eight weeks following such Merger
Termination Date, of Net Proceeds in an aggregate amount not less than the greater of (i)
$60,000,000, and (ii) such amount as will result in the Parent Borrower satisfying (on a pro
forma basis giving effect to the receipt and application of such Net Proceeds against the
ESI Credit Facility as provided herein) the maximum Leverage Ratio prescribed by Section
6.1 applicable after any such Equity Issuance. Any such transaction effected through a
public sale or private placement through one or more investment banks shall be on such terms
as are, in the judgment of such investment bank or banks, advisable to ensure a successful
public sale or private placement of such securities. Failure of the Parent Borrower to
consummate such transactions and apply the Net Proceeds thereof against the ESI Credit
Facility as provided herein by the end of such eight-week period shall constitute an Event
of Default for purposes of this Agreement and the other Loan Documents.

     SECTION 7. Amendment to Section 6.1 (“Leverage Ratio”). Section 6.1 of the Credit
Agreement is hereby amended by deleting the table of Maximum Ratios appearing at the end of
Section 6.1 in its entirety and substituting the following:

	 	 	 
	Periods Ending	 	Maximum Ratio
	9-30-07 through 5-31-08
	 	5.75:1.00
	6-30-08
	 	5.50:1.00
	7-31-08 through 11-30-08
	 	7.25:1.00
	12-31-08 and thereafter
	 	5.00:1.00

provided, however, that upon the consummation of any Equity Issuance by the Parent
Borrower after July 25, 2008 (but excluding any Equity Issuances effected pursuant to the Parent
Borrower’s dividend reinvestment and stock purchase plan up to an aggregate amount of $500,000 in
any twelve (12) month period), the following Maximum Ratios for the

5

 

corresponding Periods Ending
shall be in effect at such time and at all times thereafter and shall replace those set forth
above:

	 	 	 
	Periods Ending	 	Maximum Ratio
	From the month end of the
month in which such Equity
Issuance occurs through
11-30-08

	 	5.25:1.00
	 
	 	 
	12-31-08 and thereafter

	 	5.00:1.00

     SECTION 8. Amendment to Schedule 1.1-A (“Applicable Margins and Applicable Percentages”).
Schedule 1.1-A to the Credit Agreement is hereby amended by adding the following sentence
at the end of Schedule 1.1-A.

Notwithstanding the foregoing, (i) during the period from July 25, 2008, through the
ESI Commitment Termination Date, the Applicable Margins and Applicable Percentages
shall be those set forth below (regardless of the Leverage Ratio then in effect)
and, (ii) so long as no Event of Default shall have occurred and exist as of the ESI
Commitment Termination Date, for all periods after the ESI Commitment Termination
Date the Applicable Margins and Applicable Percentages shall be those set forth in
the Pricing Grid above (determined in the same manner and in accordance with the
Leverage Ratios from time to time in effect as provided in the definitions of the
terms “Applicable Margin” and “Applicable Percentage”):

	 	 	 	 	 	 	 
	 	 	 	 	Applicable	 	Applicable
	Applicable Margin 	 	Applicable Margin	 	Percentage for	 	Percentage for
	for Eurodollar Loans	 	for Base Rate Loans	 	Commitment Fees	 	L/C Fees
	3.000%
	 	2.000%	 	0.500%	 	3.000%

     SECTION 9. Waivers of Certain Reporting Requirements and Prepayments.

     (a) Section 5.1(b) of the Credit Agreement requires that the Parent Borrower deliver
to the Administrative Agent and each Lender certain unaudited financial statements after the end of
each of the first three fiscal quarters of the Parent Borrower’s Fiscal Year, including
consolidating statements of income, stockholders’ or partners’ equity (as applicable), and cash
flows showing in comparative form the respective amounts for the corresponding periods and portions
of the preceding Fiscal Year (such information collectively referred to herein as the “Prior Year
Comparative Information”). The Administrative Agent and the Lenders hereby agree (i) that, solely
with respect to the Parent Borrower’s fiscal quarters ended December 31,
2007, March 31, 2008, and June 30, 2008, the Parent Borrower may omit from the consolidating
statements of income, stockholders’ or partners’ equity, and cash flows the Prior Year Comparative
Information and (ii) to waive any Default or Event of Default that would otherwise exist or have
occurred pursuant to Section 5.1(b) of the Credit Agreement as a result of the omission of
the Prior Year Comparative Information from such financial statements for such fiscal quarters.

6

 

     (b) Section 2.12(b) of the Credit Agreement requires that the Parent Borrower, upon
receipt of any Net Proceeds from any Equity Issuance, use a portion of such Net Proceeds to be
applied as a mandatory prepayment of certain outstanding Obligations and effect a corresponding
reduction of certain Commitments, all as provided in such Section 2.12. The Administrative
Agent and the Lenders hereby agree to waive any Default or Event of Default that would otherwise
exist or have occurred pursuant to Section 2.12 of the Credit Agreement as a result of the
Parent Borrower’s failure to make any such prepayment otherwise required as a result of the Parent
Borrower’s receipt of Net Proceeds of any Equity Issuance effected prior to July 25, 2008 as part
of the Parent Borrower’s dividend reinvestment and stock purchase plan, to the extent such Net
Proceeds have not exceeded an aggregate amount of $500,000.

     SECTION 10. Conditions to Effectiveness. This Amendment shall become effective when each of the
following conditions shall have been fulfilled:

     (i) the Borrowers, the Administrative Agent and those Lenders constituting the Required
Lenders shall have executed and delivered to the Administrative Agent a counterpart of this
Amendment;

     (ii) each of the Guarantors shall have executed and delivered to the Administrative
Agent the Guarantors’ Acknowledgment and Agreement attached to this Amendment; and

     (iii) the Parent Borrower shall have paid to the Administrative Agent (i) for the
account of each of the Lenders executing and delivering a counterpart of this Amendment at
or prior to 5:00 p.m. (Central time) on July 25, 2008, an amendment and waiver fee in an
amount equal to 20 basis points (0.20%) of such Lender’s pro rata share of the Aggregate
Commitment Amounts then in effect for all Lenders, (ii) the fees separately agreed in
writing between the Parent Borrower and the Administrative Agent with respect to this
Amendment, and (iii) the fees and expenses as provided in Section 13 below.

     SECTION 11. Representations and Warranties. The Borrowers represent and warrant that (a) the
representations and warranties contained in Article IV of the Credit Agreement (with each reference
therein to (i) “this Agreement”, “hereunder” and words of like import referring to the Credit
Agreement being deemed to be a reference to this Amendment and the Credit Agreement as amended
hereby and (ii) “Loan Documents”, “thereunder” and words of like import being deemed to include
this Amendment, the Credit Agreement, as amended hereby, and the Guarantors’ Acknowledgment and
Agreement) are true and correct in all material respects (unless they speak to a specific prior
date) on and as of the date hereof (after giving effect to this Amendment) as though made on and as
of such date, (b) the execution, delivery and performance of this Amendment and the Guarantors’
Acknowledgment and Agreement have been duly authorized by all necessary and appropriate
organizational action by each respective Loan Party, do not violate any of the organizational
documents of any respective Loan Party, and do not violate any provision of applicable law or
regulations, orders, or rulings of any Governmental Authority applicable to any respective Loan
Party, or any other material agreement to which any respective Loan Party is a party, (c) upon
execution and delivery of this Amendment and the Guarantors’ Acknowledgment and Agreement by each
Loan Party party to such agreements, each document will constitute a legal and binding obligation
of each such Loan Party, enforceable

7

 

against it in accordance with its terms, and (d) no event has
occurred and is continuing, or would result from the execution and delivery of this Amendment, that
constitutes a Default or an Event of Default (after giving effect to this Amendment).

     SECTION 12. Effect on the Credit Agreement. Except as specifically provided above, the Credit
Agreement shall continue to be in full force and effect and is hereby in all respects ratified and
confirmed. The execution, delivery and effectiveness of this Amendment shall not, except as
expressly provided herein, operate as a waiver of any right, power or remedy of the Lenders under
the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement.

     SECTION 13. Costs and Expenses. The Borrowers agree to pay on demand all reasonable costs and
expenses of the Administrative Agent in connection with the preparation, execution and delivery of
this Amendment, including, without limitation, the fees and out-of-pocket expenses of counsel for
the Administrative Agent with respect thereto, and all costs and expenses (including, without
limitation, counsel fees and expenses), if any, in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Amendment.

     SECTION 14. Execution in Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts (in each case, any such
execution and delivery may occur by facsimile or pdf transmission of executed counterparts or
signature pages), each of which when so executed and delivered shall be deemed to be an original
and all of which taken together shall constitute but one and the same instrument.

     SECTION 15. Governing Law. This Amendment shall be governed by, and construed in accordance with,
the internal laws of the State of Georgia.

8

 

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

	 	 	 	 	 
	 	ENERGYSOUTH, INC.,

as the Parent Borrower

 	 
	 	By:  	/s/ Charles P. Huffman
 	 
	 	 	Name:  	Charles P. Huffman 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 	 	 
	 	 	BAY GAS STORAGE COMPANY, LTD.,

as the Subsidiary Borrower	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	EnergySouth Midstream, Inc.,
its sole general partner
	 	 

	 	 	 	 	 
	 	 	 
	 	By:  	                         /s/ Charles P. Huffman
 	 
	 	 	Name:  	Charles P. Huffman 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

[SIGNATURE PAGE TO FIRST AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT]

 

	 	 	 	 	 
	 	REGIONS BANK,

as Administrative Agent, as Issuing Bank,

as Swingline Lender and as a Lender

 	 
	 	By:  	/s/ Edward Midyett
 	 
	 	 	Name:  	Edward Midyett 	 
	 	 	Title:  	Vice President 	 
	 

[SIGNATURE PAGE TO FIRST AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT]

 

	 	 	 	 	 
	 	SUNTRUST BANK,

as a Lender

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[SIGNATURE PAGE TO FIRST AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT]

 

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A.,

as a Lender

 	 
	 	By:  	/s/ Helen D. Davis
 	 
	 	 	Name:  	Helen D. Davis 	 
	 	 	Title:  	Vice President 	 
	 

 [SIGNATURE PAGE TO FIRST AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT]

 

	 	 	 	 	 
	 	UNION BANK OF CALIFORNIA, N.A.,

as a Lender

 	 
	 	By:  	/s/ Jeff Fesenmaier
 	 
	 	 	Name:  	Jeff Fesenmaier 	 
	 	 	Title:  	Vice President 	 
	 

[SIGNATURE PAGE TO FIRST AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT]

 

GUARANTORS’ ACKNOWLEDGMENT AND AGREEMENT

     Each of the undersigned Guarantors consents to the execution and delivery by the Borrowers of
this Amendment and jointly and severally ratifies and confirms the terms of the Subsidiary
Guarantee with respect to all indebtedness now or hereafter outstanding under the Credit Agreement
as amended hereby and all promissory notes issued thereunder. Each of the undersigned Guarantors
acknowledges and agrees that, notwithstanding anything to the contrary contained herein or in any
other document evidencing any indebtedness of the Borrowers to the Lenders or any other obligation
of the Borrowers, or any actions now or hereafter taken by the Lenders with respect to any
obligations of the Borrowers, the Subsidiary Guarantee (i) is and shall continue to be an absolute,
unconditional, joint and several, continuing and irrevocable guarantee of payment of all “Parent
Guaranteed Obligations” and “Subsidiary Borrower Guaranteed Obligations” to the extent and as
provided therein, including without limitation, all Borrowings (including, without limitation, all
Revolving Borrowings and Swingline Borrowings) and Letters of Credit made and issued under the
Credit Agreement, as amended, and (ii) is and shall continue to be in full force and effect in
accordance with its terms. Nothing contained herein to the contrary shall release, discharge,
modify, change or affect the obligations or liabilities of any Guarantor under the Subsidiary
Guarantee.

[Signature Page Follows]

 

	 	 	 	 	 
	 	GUARANTORS:

ENERGYSOUTH MIDSTREAM, INC.

 	 
	 	By:  	/s/ Charles P. Huffman
 	 
	 	 	Name:  	Charles P. Huffman 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	ENERGYSOUTH SERVICES, INC.

 	 
	 	By:  	/s/ Charles P. Huffman
 	 
	 	 	Name:  	Charles P. Huffman 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	MGS MARKETING SERVICES, INC.

 	 
	 	By:  	/s/ Charles P. Huffman
 	 
	 	 	Name:  	Charles P. Huffman 	 
	 	 	Title:  	Executive Vice President and
Chief Financial Officer

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