Document:

exv10w38

Exhibit 10.38

EIGHTH AMENDMENT TO SECOND AMENDED

AND RESTATED FINANCING AGREEMENT

     THIS EIGHTH AMENDMENT TO SECOND AMENDED AND RESTATED FINANCING AGREEMENT (“this
Agreement”) entered into on this 31st day of March, 2009, to be effective, unless another
effective date is otherwise herein specified, March 27, 2009, is by and among The CIT
Group/Business Credit, Inc. (“CIT”), Wachovia Bank, N.A. (“Wachovia”), PNC Bank
National Association (“PNC”), and SunTrust Bank (“SunTrust”, together with CIT,
Wachovia, and PNC, the “Existing Lenders”), The Greinke Personal Living Trust, Frank P.
Greinke, an individual residing in Tacoma, Washington, Trustee (“Greinke Trust”) (the
Greinke Trust being herein referred to as the “Additional Lender”, and together with the
Existing Lenders, being herein collectively referred to as the “Lenders”), CIT as
administrative and collateral agent (“Agent”), United Fuel & Energy Corporation, a Texas
corporation (“United”), Three D Oil Co. of Kilgore, Inc., a Texas corporation (“Three
D”) and Cardlock Fuels System, Inc. a California corporation (“Cardlock”) (United,
Three D and Cardlock being herein individually referred to as a “Company” and collectively
referred to as the “Companies”), and United Fuel & Energy Corporation, a Nevada corporation
(“Parent”).

RECITALS

     A. Companies, Agent, and Lenders are the present parties to that certain Second Amended and
Restated Financing Agreement, dated as of March 27, 2007, originally executed by United, Three D,
Lenders, SunTrust and Agent (as amended from time to time, the “Financing Agreement”).

     B. Companies have notified Agent and the Lenders that they anticipate that they will fail to
comply with the EBITDA financial covenant specified in Section 7.10(c) of the Financing
Agreement for the measurement period ending on February 28, 2009, which would, consequently, result
in an Event of Default under Section 10.1(e) of the Financing Agreement.

     C. Consequently, Companies have requested that Agent and Required Lenders amend certain
financial covenants.

     D. Pursuant to the terms and conditions of this Agreement, each of the Companies, Agent and
Required Lenders are willing to amend the Financing Agreement as hereinafter set forth (including
reducing the aggregate Revolving Line of Credit Commitment from $85,000,000 to $50,000,000).

     NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending
to be legally bound, agree as follows, as hereinafter set forth:

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ARTICLE I

Definitions

     1.01 Capitalized terms used in this Agreement are defined in the Financing Agreement, as
amended hereby, unless otherwise stated.

ARTICLE II

Agreements

     2.01 Amendment to Section 1 of Financing Agreement; Additional New Definition.
Effective as of the date the conditions specified in Section 4.01 of this Agreement have
been satisfied in Agent’s credit judgment or waived by Agent, Section 1 of the Financing
Agreement is amended by adding thereto the following new definition to be inserted in its proper
alphabetical order and to read in its entirety as follows:

     “Eighth Amendment shall mean that certain Eighth Amendment to Second
Amended and Restated Financing Agreement executed by Agent, Lenders, Companies and
Parent.”

     2.02 Amendment to Section 1 of Financing Agreement; Amendment and Restatement of
Definitions of “Applicable Base Rate Margin”, “Applicable LIBOR Margin”, “Commitment”, “Initial
Adjustment Date”, and “Revolving Line of Credit”. Effective as of the date the conditions
specified in Section 4.01 of this Agreement have been satisfied in Agent’s credit judgment
or waived by Agent, Section 1 of the Financing Agreement is amended by amending and
restating the definitions of “Applicable Base Rate Margin”, “Applicable LIBOR Margin”,
“Commitment”, “Initial Adjustment Date”, “Revolving Line of Credit” to read in their entirety as
follows:

     “Applicable Base Rate Margin means, with respect to any amount
outstanding under the Revolving Loans or the Term Loans, as the case may be, which
are Base Rate Loans, the rate of interest per annum determined as set forth below:

     (a) during the period beginning the date of execution of the Eighth
Amendment until the Initial Adjustment Date: (i) as to the amount of
Revolving Loans outstanding on any day, 3.25%; and (ii) as to the amount of
Term Loans outstanding on any day, 3.50%; and

     (b) thereafter, on each Adjustment Date (beginning on the
Initial Adjustment Date) and continuing until the next Adjustment Date, the
applicable percent per annum set forth in the pricing table below opposite
the relevant Fixed Charge Coverage Ratio calculated as of the last day of
the relevant Fiscal Quarter for the six calendar month period ending on such
day:

2

 

APPLICABLE BASE RATE

MARGIN PRICING TABLE

	 	 	 	 	 
	 	 	Applicable Base	 	Applicable Base
	Fixed Charge	 	Rate Margin	 	Rate Margin
	Coverage Ratio	 	for Revolving Loans	 	for Term Loans
	 
	 	 	 	 
	(i) Greater than or equal to 2.00 to 1.00
	 	(i) 2.50%	 	(i) 2.75%
	 
	 	 	 	 
	(ii) Less than 2.00 to 1.00, but equal to or greater than 1.50 to
1.00
	 	(ii) 2.75%	 	(ii) 3.00%
	 
	 	 	 	 
	(iii) Less than 1.50 to 1.00, but equal to or greater than 1.25 to 1.00
	 	(iii) 3.00%	 	(iii) 3.25%
	 
	 	 	 	 
	(iv) Less than 1.25 to 1.00, but equal to or greater than 1.00 to 1.00
	 	(iv) 3.00%	 	(iv) 3.25%
	 
	 	 	 	 
	(v) Less than 1.00 to 1.00, but equal to or greater than 0.85 to 1.00
	 	(v) 3.25%	 	(v) 3.50%
	 
	 	 	 	 
	(vi) Less than 0.85 to 1.00
	 	(vi) 3.25%	 	(vi) 3.50%
	 
	 	 	 	 

All adjustments to the Applicable Base Rate Margin shall be implemented by the Agent
based on the financial statements and related officer’s certificate for the relevant
period delivered by the Companies to the Agent pursuant to Paragraph 7.8(c)
of Section 7 hereof, and shall take effect retroactively on the Adjustment
Date immediately succeeding the date of the Agent’s receipt of such financial
statements. Notwithstanding the foregoing: (a) no reduction in Applicable Base
Rate Margin shall occur on an Adjustment Date if a Default or an Event of Default
shall have occurred and be continuing on such Adjustment Date or the date of the
Agent’s receipt of the financial statements on which such reduction is to be based;
and (b) if the Companies fail to deliver the financial statements on which any
reduction in applicable margins is to be based within ten (10) days of the due date
for such items set forth in Paragraph 7.8(c) of Section 7, then
effective as of the due date for such financial statements, the Applicable Base

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Rate Margin shall increase to the highest margin set forth in the table above until
the following Adjustment Date. Without limitation of any other provision of this
Financing Agreement or any other remedy available to Agent or Lenders under any of
the Loan Documents, if, as a result of any restatement of or other adjustment to the
financial statements delivered by the Companies to the Agent pursuant to
Paragraph 7.8(c) of Section 7 hereof or for any other reason, the
Agent determines that (y) the Fixed Charge Coverage Ratio as calculated by the
Companies as of any applicable date was inaccurate by more than 0.04 (for example,
the Fixed Charge Coverage Ratio is initially reported as 1.50 to 1.00, but as
corrected is 1.459 to 1.00) (a ‘Material Adjustment’) and (z) a proper
calculation of the Fixed Charge Coverage Ratio would have resulted in a different
Applicable Base Rate Margin for any period, then in the event of a Material
Adjustment (but not if a Material Adjustment has not occurred) (i) if the proper
calculation of the Fixed Charge Coverage Ratio would have resulted in a higher
Applicable Base Rate Margin for such period, the Companies shall automatically and
retroactively be obligated to pay to the Agent promptly on demand by the Agent, an
amount equal to the excess of the amount of interest and fees that should have been
paid for such period over the amount of interest and fees actually paid for such
period; and (ii) if the proper calculation of the Fixed Charge Coverage Ratio would
have resulted in a lower Applicable Base Rate Margin for such period, the Agent
shall have no obligation to repay any interest or fees to the Companies; provided
that if, as a result of any Material Adjustment a proper calculation of the Fixed
Charge Coverage Ratio would have resulted in a higher Applicable Base Rate Margin
for one or more periods and a lower Applicable Base Rate Margin for one or more
other periods (due to the shifting of income or expenses from one period to another
period or any similar reason), then the amount payable by the Companies pursuant to
clause (i) above shall be based upon the excess, if any, of the amount of interest
and fees that should have been paid for all applicable periods over the amount of
interest and fees paid for all such periods.

     Applicable LIBOR Margin means, on any specific date, with respect to
any amount outstanding under the Revolving Loans or Term Loans, as the case may be,
which are LIBOR Loans, the rate of interest per annum determined as set forth below:

     (a) during the period beginning the date of execution of the Eighth
Amendment until the Initial Adjustment Date: (i) as to the amount of
Revolving Loans outstanding on any day, 6.00%; and (ii) as to the amount of
Term Loans outstanding on any day, 6.25%; and

     (b) thereafter, on each Adjustment Date (beginning on the
Initial Adjustment Date) and continuing until the next Adjustment Date, the
applicable percent per annum set forth in the pricing table below opposite
the relevant Fixed Charge Coverage Ratio calculated as of the last day of
the relevant Fiscal Quarter for the six calendar month period ending on such
day:

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APPLICABLE LIBOR MARGIN

PRICING TABLE

	 	 	 	 	 
	 	 	Applicable LIBOR	 	Applicable LIBOR
	Fixed Charge	 	Margin for	 	Margin for Term
	Coverage Ratio	 	Revolving Loans	 	Loans
	 
	 	 	 	 
	(i) Greater than or equal to 2.00 to 1.00
	 	(i) 4.50%	 	(i) 4.75%
	 
	 	 	 	 
	(ii) Less than 2.00 to 1.00, but equal to or greater than 1.50 to 1.00
	 	(ii) 4.75%	 	(ii) 5.00%
	 
	 	 	 	 
	(iii) Less than 1.50 to 1.00, but equal to or greater than 1.25 to 1.00
	 	(iii) 5.00%	 	(iii) 5.25%
	 
	 	 	 	 
	(iv) Less than 1.25 to 1.00, but equal to or greater than 1.00 to 1.00
	 	(iv) 5.25%	 	(iv) 5.50%
	 
	 	 	 	 
	(v) Less than 1.00 to 1.00, but equal to or greater than 0.85 to 1.00
	 	(v) 5.50%	 	(iv) 5.75%
	 
	 	 	 	 
	(vi) Less than 0.85 to 1.00
	 	(vi) 6.00%	 	(v) 6.25%
	 
	 	 	 	 

All adjustments to the Applicable LIBOR Margin shall be implemented by the Agent
based on the financial statements and related officer’s certificate for the relevant
period delivered by the Companies to the Agent pursuant to Paragraph 7.8(c)
of Section 7 hereof, and shall take effect on the Adjustment Date
immediately succeeding the date of the Agent’s receipt of such financial statements.
Notwithstanding the foregoing: (a) no reduction in Applicable Margins shall occur
on an Adjustment Date if a Default or an Event of Default shall have occurred and be
continuing on such Adjustment Date or the date of the Agent’s receipt of the
financial statements on which such reduction is to be based; and (b) if the
Companies fail to deliver the financial statements on which any reduction in
applicable margins is to be based within ten (10) days of the due date for such
items set forth in Paragraph 7.8(c) of Section 7, then effective as
of the due date for such financial statements, the Applicable LIBOR Margin shall
increase to the highest margin set forth in the table above until the following

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Adjustment Date. Without limitation of any other provision of this Financing
Agreement or any other remedy available to Agent or Lenders under any of the Loan
Documents, if, as a result of any restatement of or other adjustment to the
financial statements delivered by the Companies to the Agent pursuant to
Paragraph 7.8(c) of Section 7 hereof or for any other reason, the
Agent determines that (y) the Fixed Charge Coverage Ratio as calculated by the
Companies as of any applicable date was inaccurate and such inaccuracy constitutes a
Material Adjustment and (z) a proper calculation of the Fixed Charge Coverage Ratio
would have resulted in a different Applicable LIBOR Margin for any period, then in
the event of a Material Adjustment (but not if a Material Adjustment has not
occurred) (i) if the proper calculation of the Fixed Charge Coverage Ratio would
have resulted in a higher Applicable LIBOR Margin for such period, the Companies
shall automatically and retroactively be obligated to pay to the Agent promptly on
demand by the Agent, an amount equal to the excess of the amount of interest and
fees that should have been paid for such period over the amount of interest and fees
actually paid for such period; and (ii) if the proper calculation of the Fixed
Charge Coverage Ratio would have resulted in a lower Applicable LIBOR Margin for
such period, the Agent shall have no obligation to repay any interest or fees to the
Companies; provided that if, as a result of any Material Adjustment a proper
calculation of the Fixed Charge Coverage Ratio would have resulted in a higher
Applicable LIBOR Margin for one or more periods and a lower Applicable LIBOR Margin
for one or more other periods (due to the shifting of income or expenses from one
period to another period or any similar reason), then the amount payable by the
Companies pursuant to clause (i) above shall be based upon the excess, if any, of
the amount of interest and fees that should have been paid for all applicable
periods over the amount of interest and fees paid for all such periods.

     Commitment shall mean, as to any Lender, the amount of the commitment
for such Lender set forth on the signature page to the Eighth Amendment or in the
Assignment and Transfer Agreement to which such Lender is a party, as such amount
may be reduced or increased in accordance with the provisions of Paragraph
13.4(b) of Section 13 or any other applicable provisions of this
Financing Agreement.

     Initial Adjustment Date shall mean the tenth day after delivery to
Agent pursuant to Paragraph 7.8(c) of Section 7 hereof of the
financial statements of the Companies for the month ending on June 30, 2009.

     Revolving Line of Credit shall mean the aggregate commitment of the
Lenders to make loans and advances pursuant to Section 3 and issue Letters
of Credit Guaranties to the Companies in the aggregate amount equal to the aggregate
Revolving Line of Credit Commitment for each Lender as set forth on the signature
page of the Eighth Amendment or in the Assignment and Transfer Agreement to which
such Lender is a party, as such amount may be reduced or increased in accordance
with the provisions of Paragraph 13.4(b) of Section 13 or any other
applicable provision of this Financing Agreement.”

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     2.03 Amendment to Section 7.10(c). Effective as of the date the conditions specified
in Section 4.01 of this Agreement have been satisfied in Agent’s credit judgment or waived
by Agent, Section 7.10(c) of the Financing Agreement is hereby amended and restated to read
in its entirety as follows:

     “(c) Maintain EBITDA of not less than the amount set forth below for (i) the
month ending each of February 28, 2009, March 31, 2009 and April 30, 2009 and (ii)
the six calendar month period ending on May 31, 2009:

	 	 	 
	Date	 	Minimum EBITDA
	 
	 	 
	(i) February 28, 2009
	 	(i) ($450,000)
	 
	 	 
	(ii) March 31, 2009
	 	(ii) ($325,000)
	 
	 	 
	(iii) April 30, 2009
	 	(iii) ($75,000)
	 
	 	 
	(iv) May 31, 2009
	 	(iv) $4,785,000

     There shall be no minimum EBITDA financial covenant after the six calendar month
period ending on May 31, 2009.”

ARTICLE III

No Waiver

     3.01 No Waivers. Nothing contained herein shall be construed as a waiver by Agent or
any Lender of any covenant or provision of the Financing Agreement, or any other Loan Document or
any other contract or instrument between any Company and/or Parent and Agent and/or any Lender, and
neither Agent’s nor any Lender’s failure at any time or times hereafter to require strict
performance by any Company and/or Parent of any provision thereof shall waive, affect or diminish
any right of Agent or any Lender thereafter to demand strict compliance therewith. Each of Agent
and each Lender hereby reserves all rights granted under the Financing Agreement, and each other
Loan Document and any other contract or instrument between any Company and/or Parent and Agent
and/or any Lender.

ARTICLE IV

Conditions Precedent

     4.01 Conditions to Effectiveness. The effectiveness of this Agreement is subject to
the satisfaction of the following conditions precedent, unless specifically waived in writing by
Agent:

     (a) Agent shall have received all of the following, each in form and substance
satisfactory to Agent (each of which shall be deemed to be a “Loan Document” for
purposes of the Financing Agreement):

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     (i) This Agreement, duly executed by Companies, Parent and Lenders, and
acknowledged and agreed to by Greinke Trust; and

     (ii) Such additional documents, instruments and information as Agent may
request.

     (b) The representations and warranties contained herein and in the Financing Agreement,
and the other Loan Documents, as each is amended hereby, shall be true and correct as of the
date hereof, as if made on the date hereof.

     (c) No Default or Event of Default shall have occurred and be continuing, unless such
Event of Default has been otherwise specifically waived in writing by Agent and Lenders.

     (d) All corporate proceedings taken in connection with the transactions contemplated by
this Agreement and all documents, instruments and other legal matters incident thereto shall
be satisfactory to Agent and its legal counsel.

ARTICLE V

Ratifications, Representations and Warranties

     5.01 Ratifications. The terms and provisions set forth in this Agreement shall modify
and supersede all inconsistent terms and provisions set forth in the Financing Agreement and the
other Loan Documents, and, except as expressly modified and superseded by this Agreement, the terms
and provisions of the Financing Agreement and the other Loan Documents are ratified and confirmed
and shall continue in full force and effect. Each of the parties hereto agrees that the Financing
Agreement and the other Loan Documents, as amended hereby, shall continue to be legal, valid,
binding and enforceable in accordance with their respective terms.

     5.02 Representations and Warranties. Each of each Company and Parent hereby
represents and warrants to Agent and each Lender that (a) the execution, delivery and performance
of this Agreement and any and all other Loan Documents executed and/or delivered in connection
herewith have been authorized by all requisite corporate action on the part of each of each Company
and Parent and will not violate the Articles of Incorporation or Bylaws of any Company or Parent;
(b) the representations and warranties contained in the Financing Agreement, as amended hereby, and
any other Loan Document are true and correct on and as of the date hereof and on and as of the date
of execution hereof as though made on and as of each such date; and (c) no Default or Event of
Default under the Financing Agreement, as amended hereby, has occurred and is continuing, unless
such Default or Event of Default has been specifically waived in writing by Agent and each Lender.
Each of each Company and Parent hereby represents and warrants to Agent and each Lender that it is
in full compliance with all covenants and agreements contained in the Financing Agreement, and the
other Loan Documents, as amended hereby.

     5.03 Ratification of Guaranty. Parent hereby acknowledges and consents to all of the
terms and conditions of this Agreement and the Loan Documents and hereby ratifies and confirms the
Guaranty for the benefit of Agent and Lenders. Guarantor hereby represents and acknowledges that
it has no claims, counterclaims, offsets, credits or defenses to the Loan

8

 

Documents or the performance of its obligations thereunder. Guarantor agrees that nothing
contained in this Agreement or the Loan Documents shall adversely affect any right or remedy of
either Agent or Lenders under the Guaranty. Guarantor hereby agrees that with respect to the
Guaranty, all references in such Guaranty to the “Obligations” shall include, without limitation,
the obligations of Companies to Agent and Lenders under the Financing Agreement, as amended hereby.
Guarantor hereby represents and acknowledges that the execution and delivery of this Agreement and
the other Loan Documents executed in connection herewith shall in no way change or modify its
obligations as a guarantor, debtor, pledgor, assignor, obligor and/or grantor under its Guaranty
and each other Loan Document to which it is a party and shall not constitute a waiver by either
Agent or any Lender of any of either Agent’s or any Lender’s rights against Guarantor.

ARTICLE VI

Miscellaneous Provisions

     6.01 Survival of Representations and Warranties. All representations and warranties
made in the Financing Agreement or any other Loan Document, including, without limitation, any
document furnished in connection with this Agreement, shall survive the execution and delivery of
this Agreement and the other Loan Documents, and no investigation by Agent or any Lender or any
closing shall affect the representations and warranties or the right of Agent or any Lender to rely
upon them.

     6.02 Reference to Financing Agreement. Each of the Financing Agreement and the other
Loan Documents and any and all other agreements, documents or instruments now or hereafter executed
and delivered pursuant to the terms hereof or pursuant to the terms of the Financing Agreement, as
amended hereby, is hereby amended so that any reference in the Financing Agreement and such other
Loan Documents to the Financing Agreement shall mean a reference to the Financing Agreement as
amended hereby.

     6.03 Expenses of Agent. Each of each Company and Parent agrees to pay on demand all
costs and expenses incurred by Agent in connection with the preparation, negotiation and execution
of this Agreement and the other Loan Documents executed pursuant hereto, and any and all
amendments, modifications, and supplements thereto, including, without limitation, the costs and
fees of Agent’s legal counsel, and all costs and expenses incurred by Agent in connection with the
enforcement or preservation of any rights under the Financing Agreement, as amended hereby, or any
other Loan Document, including, without limitation, the costs and fees of Agent’s legal counsel.

     6.04 Severability. Any provision of this Agreement held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this
Amendment and the effect thereof shall be confined to the provision so held to be invalid or
unenforceable.

     6.05 Successors and Assigns. This Agreement is binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns, except neither any
Company nor Parent may assign or transfer any of its rights or obligations hereunder without the
prior written consent of Agent and each Lender.

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     6.06 Counterparts. This Agreement may be executed in one or more counterparts, each
of which when so executed shall be deemed to be an original, but all of which when taken together
shall constitute one and the same instrument.

     6.07 Effect of Waiver. No consent or waiver, express or implied, by Agent or any
Lender to or for any breach of or deviation from any covenant or condition by any Company or Parent
shall be deemed a consent to or waiver of any other breach of the same or any other covenant,
condition or duty.

     6.08 Headings. The headings, captions, and arrangements used in this Agreement are
for convenience only and shall not affect the interpretation of this Agreement

     6.09 Applicable Law. THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED PURSUANT
HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN AND SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

     6.10 Final Agreement. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES, AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.

     6.11 Release. EACH OF EACH COMPANY AND PARENT HEREBY ACKNOWLEDGES THAT IT HAS NO
DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE WHATSOEVER
THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF ITS LIABILITY TO REPAY THE
“OBLIGATIONS” OR TO SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM AGENT OR ANY
LENDER. EACH OF EACH COMPANY AND PARENT HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER
DISCHARGES EACH OF AGENT AND EACH LENDER, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND
ASSIGNS, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES,
AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR
UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN
PART ON OR BEFORE THE DATE THIS AGREEMENT IS EXECUTED, WHICH ANY COMPANY OR PARENT MAY NOW OR
HEREAFTER HAVE AGAINST AGENT OR ANY LENDER, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND
ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION
OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM ANY “LOANS”, INCLUDING, WITHOUT LIMITATION,
ANY CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE
HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER

10

 

THE FINANCING AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION OF THIS
AGREEMENT.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

11

 

     EXECUTED ON THIS 31st DAY OF MARCH, 2009, TO BE EFFECTIVE AS OF THE RESPECTIVE DATE INDICATED
ABOVE.

	 	 	 	 	 
	 	COMPANIES:

UNITED FUEL & ENERGY CORPORATION, 

a Texas corporation

 	 
	 	By:  	/s/ William C. Bousema
 	 
	 	Name:  	William C. Bousema 	 
	 	Title:  	Executive Vice President and

Chief Financial Officer 	 
	 
	 	THREE D OIL CO. OF KILGORE, INC.,

a Texas corporation

 	 
	 	By:  	/s/ William C. Bousema
 	 
	 	Name:  	William C. Bousema 	 
	 	Title:  	Executive Vice President and

Chief Financial Officer 	 
	 
	 	CARDLOCK FUELS SYSTEM, INC.,

a California corporation

 	 
	 	By:  	/s/ William C. Bousema
 	 
	 	Name:  	William C. Bousema 	 
	 	Title:  	Executive Vice President and

Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	PARENT:

UNITED FUEL & ENERGY CORPORATION,

a Nevada corporation

 	 
	 	By:  	/s/ William C. Bousema
 	 
	 	Name:  	William C. Bousema 	 
	 	Title:  	Executive Vice President and

Chief Financial Officer 	 
	 

 

 

	 	 	 	 	 
	 	AGENT:

THE CIT GROUP/BUSINESS CREDIT, INC.,

as Agent

 	 
	 	By:  	/s/ Robyn Pingree
 	 
	 	Name:  	Robyn Pingree 	 
	 	Title:  	Vice President 	 
	 
	 	LENDERS:

THE CIT GROUP/BUSINESS CREDIT, INC.,

as a Lender

 	 
	 	By:  	/s/ Robyn Pingree
 	 
	 	Name:  	Robyn Pingree 	 
	 	Title:  	Vice President 	 
	 
	 	Amount of Commitment:
	$16,448,050.13
	 
	 	 	 	 
	 	Amount of Revolving Line
of Credit Commitment:
	$15,000,000.00

 

 

	 	 	 	 	 
	 	WACHOVIA BANK, N.A.,

as a Lender

 	 
	 	By:  	Not Required to Sign
 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	Amount of Commitment:
	$10,965,366.75
	 
	 	 	 	 
	 	Amount of Revolving Line
of Credit Commitment:
	$10,000,000.00

 

 

	 	 	 	 	 
	 	PNC BANK NATIONAL ASSOCIATION,

as a Lender

 	 
	 	By:  	/s/ Ron Eckhoff
 	 
	 	Name: 	Ron Eckhoff 	 
	 	Title:	Vice President 	 
	 
	 	Amount of Commitment:
	$10,965,366.75
	 
	 	 	 	 
	 	Amount of Revolving Line
of Credit Commitment:
	$10,000,000.00

 

 

	 	 	 	 	 
	 	

SUNTRUST BANK, as a Lender

 	 
	 	By:  	/s/ William L. Otott
 	 
	 	Name: 	William L. Otott 	 
	 	Title:	Director 	 
	 
	 	Amount of Commitment:
	$10,965,366.75
	 
	 	 	 	 
	 	Amount of Revolving Line
of Credit Commitment:
	$10,000,000.00

 

 

Acknowledged and Agreed to this
31st day of March, 2009.

	 	 	 	 	 
	THE GREINKE PERSONAL LIVING TRUST

 	 
	By:  	/s/ Frank P. Greinke
 	 
	 	Frank P. Greinke, Trustee 	 
	 	 	 
	 
	Amount of Commitment:
	$5,000,000.00	 
	 
	 	 	 	 
	Amount of Revolving Line
of Credit Commitment:
	$5,000,000.00exv10w1

Exhibit 10.1

TRANSITION AGREEMENT

     THIS TRANSITION AGREEMENT (the “Agreement”) is entered into by and between David W. Cole (“Mr.
Cole”) and Coinstar, Inc., a Delaware corporation (“Company” or “Employer”) as of March 31, 2009.
Mr. Cole has voluntarily resigned from his position as Chief Executive Officer of the Company.
This resignation is effective March 31, 2009 (“Resignation Date”).

1. TRANSITION PAYMENTS & BENEFITS

     Mr. Cole will be paid a total of Five Hundred Thousand Dollars ($500,000.00), less all
applicable deductions and tax withholdings. Payment shall be made to Mr. Cole in twenty-four (24)
substantially equal semi-monthly installments at regularly scheduled payroll intervals, beginning
April 1, 2009, and continuing for eleven (11) consecutive months thereafter; provided, however,
that the installments that would normally be paid in the months of April 2009 through September
2009, shall be accumulated without interest and paid to Mr. Cole in October 2009. For purposes of
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), each such installment
shall be treated as a separate payment.

     The vesting of Mr. Cole’s outstanding unvested stock options has been accelerated such that
all tranches of such options that would have become vested on or prior to March 31, 2010 are fully
vested and exercisable on March 31, 2009. All of Mr. Cole’s vested unexercised stock options
outstanding on March 31, 2009, including the stock options so accelerated, will remain exercisable
until June 30, 2010, and to the extent not exercised will be cancelled as of 5:00 PM Pacific Time
on that date. The vesting of Mr. Cole’s outstanding time-vested restricted stock has been
accelerated such that all tranches of such restricted stock that would have become vested on or
prior to March 31, 2010 are fully vested on March 31, 2009 so that the restrictions on such shares
lapse and such shares are no longer subject to forfeiture on that date. The vesting of Mr. Cole’s
outstanding earned performance-based restricted stock has been accelerated such that all tranches
of such restricted stock are fully vested on March 31, 2009 so that the restrictions on such shares
lapse and such shares are no longer subject to forfeiture on that date.

2. NON-INTERFERENCE WITH COMPANY’S EMPLOYMENT RELATIONSHIP

     Mr. Cole agrees that he will not directly or indirectly seek to induce the departure of or
hire away any current employees of the Company for a period of one (1) year from the Resignation
Date. In addition, Mr. Cole agrees not to interfere in any manner with the employment relations
between the Company and its other employees.

3. GENERAL WAIVER AND RELEASE OF CLAIMS

     Mr. Cole expressly waives any and all claims against the Company and releases the Company
(including its officers, directors, stockholders, employees, agents, and representatives) from any
and all claims, whether known or unknown, that he may have that in any way relate to the employment
relationship with the Company, including the termination of the employment relationship and any
disqualification of incentive stock options. It is understood that this release includes, but is
not limited to, any claims for wages, bonuses, employment benefits, or damages of any kind
whatsoever, arising out of any contracts, expressed or implied, any theory of

 

 

wrongful discharge, any legal restriction on the employment relationship or the Company’s right to
terminate employees, or any federal, state, or other governmental statute or ordinance, including,
without limitation, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act,
or the Washington Law Against Discrimination. Mr. Cole represents that he has not filed any
complaints, charges, or lawsuits against the Company with any governmental agency or any court, and
agrees that he will not initiate or encourage any such actions, and will not assist any such
actions other than as required by law. This waiver and release shall not waive or release any
claims under this Agreement or predicated on acts that occur after the date of execution of this
Agreement.

4. REVIEW PERIOD AND REVOCATION PERIOD; EFFECTIVE DATE

     Mr. Cole acknowledges that his waiver and release hereunder of any rights he may have under
the Age Discrimination in Employment Act of 1967 (“ADEA”), including any amendments, is knowing and
voluntary. The Company and Mr. Cole agree that this waiver and release does not apply to any
rights or claims that may arise under the ADEA after the effective date of this Agreement. Mr.
Cole acknowledges that he has been advised by this writing, as required by the Older Workers
Benefit Protection Act, that (a) he should consult with an attorney prior to executing this
Agreement; (b) he has twenty-one (21) days to consider this Agreement (although he may, by his own
choice, execute this Agreement earlier), during which time this Agreement will not be amended,
modified, or revoked by the Company; (c) he has seven (7) days following the execution of this
Agreement to revoke the Agreement by providing written notice to the Company; and (d) this
Agreement will not be effective until the expiration of the seven (7) day revocation period.
Should Mr. Cole elect to revoke this Agreement, he must do so by sending a certified letter, return
receipt requested, to: Coinstar, Inc., 1800 114th Avenue SE, Bellevue, WA 98004, Attn: General
Counsel.

5. SUCCESSORS AND ASSIGNS

     This Agreement will bind and inure to the benefit of the parties and their respective legal
representatives, successors, and assigns.

6. KNOWING AND VOLUNTARY AGREEMENT

     Mr. Cole represents and agrees that he (a) has read this Agreement; (b) understands its terms
and the fact that it releases any claim he might have against the Company and its officers,
directors, stockholders, employees, agents, and representatives; (c) understands that he has the
right to consult an attorney of his choice; and (d) enters into this Agreement without duress or
coercion from any source.

7. ENTIRE AGREEMENT

     This Agreement sets forth the entire understanding between Mr. Cole and the Company,
superseding any prior or contemporaneous agreements and understandings, written or oral, express or
implied; provided, however, that this Agreement does not modify or extinguish (i) Sections 4 and 10
of the Employment Agreement executed by the parties on January 1, 2004, or (ii) the Proprietary and
Invention Agreement executed by Mr. Cole on October 8, 2001. The provisions of this Agreement are
severable, and if any part of it is found to be unlawful or

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unenforceable, the other provisions of this Agreement shall remain fully valid and enforceable to
the maximum extent consistent with applicable law. The headings and subheadings in this Agreement
are for convenience of reference and are not intended to add substance to the terms of the
Agreement. The parties agree and acknowledge that in order to be enforceable, any modifications,
changes, additions or deletions to this Agreement must be in writing and signed by both parties.

8. ARBITRATION

     Any controversies or claims arising out of or relating to this Agreement shall be fully and
finally settled by arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association then in effect (the “AAA Rules”), conducted by one arbitrator either
mutually agreed upon by the Company and Mr. Cole or chosen in accordance with the AAA Rules, except
that the parties thereto shall have any right to discovery as would be permitted by the Federal
Rules of Civil Procedure for a period of 90 days following the commencement of such arbitration and
the arbitrator thereof shall resolve any dispute which arises in connection with such discovery.
The prevailing party shall be entitled to costs, expenses and reasonable attorneys’ fees, and
judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction
thereof. This provision shall not preclude the Company from seeking court enforcement or relief
based upon an alleged violation of Mr. Cole’s obligations under any noncompetition or
non-disclosure agreement.

9. APPLICABLE LAW

     This Agreement and all obligations and duties under this Agreement shall be governed by and
interpreted according to the laws of the State of Washington, without regard to its choice of law
principles.

10. CODE SECTION 409A

     The Company makes no representations or warranties to Mr. Cole with respect to any tax,
economic or legal consequences of this Agreement or any payments or other benefits provided
hereunder, including without limitation under Code Section 409A, and no provision of this Agreement
shall be interpreted or construed to transfer any liability for failure to comply with Code Section
409A or any other legal requirement from Mr. Cole or any other person to the Company, any of its
subsidiaries or affiliates or any other person. Mr. Cole, by executing this Agreement, shall be
deemed to have waived any claim against the Company, its subsidiaries and affiliates and any other
person with respect to any such tax, economic or legal consequences. However, the parties intend
that this Agreement and the payments and other benefits provided hereunder shall be exempt from the
requirements of Code Section 409A to the maximum extent possible, whether pursuant to the
short-term deferral exception described in Treasury Regulation Section 1.409A-1(b)(4) or otherwise.
To the extent Code Section 409A is applicable to this Agreement (and such payments and benefits),
the parties intend that this Agreement (and such payments and benefits) shall comply with the
deferral, payout and other limitations and restrictions imposed under Code Section 409A.
Notwithstanding the foregoing or any other provision of this Agreement, (i) this Agreement shall be
interpreted, operated and administered in a manner consistent with such intentions, and (ii)
neither the Company, nor any of its

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subsidiaries or affiliates, shall have any liability to Mr. Cole or his beneficiaries should any
payments made under this Agreement be subject to any tax (including interest and penalties) that
may be imposed under Code Section 409A.

11. AUTHORITY TO ENTER AGREEMENT

     The Company and Mr. Cole agree and warrant that the Company, for itself, and Mr. Cole, for
himself, have the authority to enter into this Agreement, and that by so doing the Company, for
itself, and Mr. Cole, for himself, are not violating any obligation to any third party or entity.
The individual signing this Agreement on behalf of the Company warrants and represents that he is
duly authorized to do so, has the legal capacity to do so, and that all corporate actions necessary
to authorize the execution, delivery and performance of this Agreement have been duly and validly
taken prior to the date hereof.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the dates indicated below.

	 	 	 	 	 	 	 	 	 	 	 
	COINSTAR, INC.	 	 	 	DAVID W. COLE	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By 
	/s/ Paul D. Davis	 	 	 	/s/ David W. Cole	 	 	 	 
	 	 	 	 	 	 	 	 
	Its 

	Chief Executive Officer	 	 	 	Dated: 	March 31, 2009	 	 
	 

	 

	 	 
	 	 	 	 

	 	 
	Dated: 
	March 31, 2009	 	 	 	 	 	 	 	 
	 

	 	 

	 	 
	 	 
	 	 
	 	 

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