UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

Current Report Pursuant to Section 13 or

15(d) of the Securities Exchange Act of 1934

March 31, 2008

Date of Report (Date of earliest event reported)

 

 

ATMOS ENERGY CORPORATION

(Exact Name of Registrant as Specified in its Charter)

 

TEXAS AND VIRGINIA   1-10042   75-1743247

(State or Other Jurisdiction

of Incorporation)

  (Commission File Number)  

(I.R.S. Employer

Identification No.)

 

1800 THREE LINCOLN CENTRE,

5430 LBJ FREEWAY, DALLAS, TEXAS

  75240
(Address of Principal Executive Offices)   (Zip Code)

(972) 934-9227

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨

   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨

   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨

   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨

   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 1.01. Entry into a Material Definitive Agreement.

On March 31, 2008, Atmos Energy Marketing, LLC (“AEM”), a Delaware limited liability company, which is wholly-owned by Atmos Energy Holdings, Inc., a Delaware corporation and a wholly-owned subsidiary of Atmos Energy Corporation, entered into the Fourth Amendment dated as of March 31, 2008, to the Uncommitted Second Amended and Restated Credit Agreement, dated as of March 30, 2005, as amended by the First Amendment dated November 28, 2005, the Second Amendment dated March 31, 2006, and the Third Amendment dated March 30, 2007, by and among AEM; Fortis Capital Corp., a Connecticut corporation, as joint lead arranger and joint bookrunner, as administrative agent for the banks, as collateral agent, as an issuing bank and as a bank; BNP Paribas, a bank organized under the laws of France, as joint lead arranger and joint bookrunner, as documentation agent, as an issuing bank and as a bank; Société Générale, as syndication agent and as a bank; and a syndicate of five additional banks identified therein.

The Fourth Amendment amended the credit facility, primarily to (i) extend the term of the facility for an additional 12 months to March 31, 2009; (ii) remove the financial covenant of AEM in the facility relating to the amount of cumulative losses that could be incurred by AEM and its subsidiaries over a specific period of time; and (iii) include provisions in the facility permitting banks participating in the facility, or their affiliates, to engage in transactions with AEM involving the sale, purchase or exchange of physical commodities pursuant to contracts executed by each of such banks or their affiliates, and permitting such banks or their affiliates to use collateral provided by AEM under such contracts to offset obligations due from AEM under those contracts. The specific rights and obligations of AEM as well as the banks or their affiliates participating in such transactions are set forth in the Intercreditor Agreement dated March 31, 2008.

The credit facility, as amended, will continue to be used, on an uncommitted and fully discretionary basis, to provide loans to AEM and issue letters of credit for the account of AEM, primarily in order to continue to provide working capital for its natural gas marketing business. Borrowings made as revolving loans under the credit facility will continue to bear interest at a floating rate equal to a base rate, defined as the higher of (i) .50% per annum above the federal funds rate or (ii) the per annum rate of interest established by JPMorgan Chase Bank, N.A. as its prime rate at the time of such borrowing plus an applicable margin, which is defined as .25% per annum. Based upon the current prime rate, revolving loans would bear interest at 5.5% per annum. Borrowings made as offshore rate loans will continue to bear interest at a floating rate equal to an offshore rate, which is equal to a base rate based upon LIBOR for the applicable interest period plus an applicable margin, which will range from 1.250% to 1.625% per annum, depending on the excess tangible net worth of AEM, as defined in the credit facility. Based upon the current LIBOR rate for a seven day period, offshore rate loans would bear interest at 4.204% per annum. Fees for letters of credit issued by the banks will continue to range from 1.000% to 1.875% per annum, depending on the excess tangible net worth of AEM and whether the letters of credit are swap-related.

The credit facility will expire on March 31, 2009, at which time all amounts outstanding under the facility will be due and payable, except for any letters of credit outstanding at that date, all of which will be due no later than March 31, 2010. The credit facility contains usual and customary covenants for transactions of this type, including covenants limiting liens, additional indebtedness and mergers. In addition, AEM will be required to not exceed a maximum ratio of total liabilities to tangible net worth of 5.00 to 1.00, along with maintaining minimum levels of net working capital ranging from $20 million to $120 million, and tangible net worth ranging from $21 million to $121 million, as all such terms are defined in the credit facility, depending on the

 

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total amount of borrowing elected from time to time by AEM. The credit facility is secured by substantially all of the assets of AEM and is guaranteed by its parent company, Atmos Energy Holdings, Inc.

In the event of a default by AEM under the credit facility, including cross-defaults relating to specified other indebtedness of AEM having a principal amount of more than $250,000 in the aggregate, the administrative agent may, and shall upon the request of a certain minimum number of the banks, terminate the obligations of the banks to make loans or issue letters of credit under the credit facility, declare the amount outstanding payable immediately, including all accrued interest and unpaid fees, and enforce any and all rights and interests created and existing under the credit facility documents, including, without limitation, all rights of set-off and all other rights available under the law.

With respect to the other parties to the credit facility, AEM has or may have had customary banking relationships based on the provision of a variety of financial services, including the purchase and sale of financial instruments traded on various commodity exchanges, none of which are material individually or in the aggregate with respect to any individual party, other than BNP Paribas, which relationship is material to AEM. These financial instruments include, but are not limited to, NYMEX futures and over-the-counter natural gas hedges. In addition, AEM or its affiliates have or may have purchased natural gas on an arm’s length basis based upon market prices from one of more affiliates of the other parties to the credit facility. Copies of the Fourth Amendment and the Intercreditor Agreement are attached hereto as Exhibits 10.1 and 10.2, respectively, each of which are incorporated herein by reference. The foregoing summary does not purport to be complete and is qualified in its entirety by reference to the Fourth Amendment and the Intercreditor Agreement.

 

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information described in Item 1.01 above is hereby incorporated herein by reference.

 

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Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

 

10.1    Fourth Amendment, dated as of March 31, 2008, to the Uncommitted Second Amended and Restated Credit Agreement, dated as of March 30, 2005, as amended by the First Amendment, dated November 28, 2005, the Second Amendment, dated March 31, 2006, and the Third Amendment, dated March 30, 2007, and as otherwise amended, restated, supplemented or modified prior to the date hereof, among Atmos Energy Marketing, LLC, a Delaware limited liability company, the financial institutions from time to time parties thereto (the “Banks”), Fortis Capital Corp., a Connecticut corporation, as Joint Lead Arranger and Joint Bookrunner, as Administrative Agent for the Banks, as Collateral Agent, as an Issuing Bank, and as a Bank; BNP Paribas, a bank organized under the laws of France, as Joint Lead Arranger and Joint Bookrunner, and as Documentation Agent, as an Issuing Bank, and as a Bank; and Société Générale, as Syndication Agent and as a Bank
10.2    Intercreditor Agreement, dated as of March 31, 2008 (as amended, supplemented and otherwise modified from time to time, the “Agreement”), among Fortis Capital Corp., a Connecticut corporation, in its capacity as Collateral Agent (together with its successors and assigns in such capacity, the “Agent”) for the Banks hereinafter referred to, and each bank and other financial institution which is now or hereafter a party to this Agreement in its capacity as a Bank and, as applicable, as a Swap Bank (collectively, the “Swap Banks”) and as a Physical Trade Bank (collectively, the “Physical Trade Banks”)

 

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

   ATMOS ENERGY CORPORATION
   (Registrant)                                                 
Date: April 4, 2008    By:    /s/ LOUIS P. GREGORY
      Louis P. Gregory
      Senior Vice President and General Counsel

 

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INDEX TO EXHIBITS

 

Exhibit
Number

  

Description

10.1    Fourth Amendment, dated as of March 31, 2008, to the Uncommitted Second Amended and Restated Credit Agreement, dated as of March 30, 2005, as amended by the First Amendment, dated November 28, 2005, the Second Amendment, dated March 31, 2006, the Third Amendment, dated March 30, 2007, and as otherwise amended, restated, supplemented or modified prior to the date hereof, among Atmos Energy Marketing, LLC, a Delaware limited liability company, the financial institutions from time to time parties thereto (the “Banks”), Fortis Capital Corp., a Connecticut corporation, as Joint Lead Arranger and Joint Bookrunner, as Administrative Agent for the Banks, as Collateral Agent, as an Issuing Bank, and as a Bank; BNP Paribas, a bank organized under the laws of France, as Joint Lead Arranger and Joint Bookrunner, and as Documentation Agent, as an Issuing Bank, and as a Bank; and Société Générale, as Syndication Agent and as a Bank
10.2    Intercreditor Agreement, dated as of March 31, 2008 (as amended, supplemented and otherwise modified from time to time, the “Agreement”), among Fortis Capital Corp., a Connecticut corporation, in its capacity as Collateral Agent (together with its successors and assigns in such capacity, the “Agent”) for the Banks hereinafter referred to, and each bank and other financial institution which is now or hereafter a party to this Agreement in its capacity as a Bank and, as applicable, as a Swap Bank (collectively, the “Swap Banks”) and as a Physical Trade Bank (collectively, the “Physical Trade Banks”)

 

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Exhibit 10.1

EXECUTION VERSION

FOURTH AMENDMENT TO THE

UNCOMMITTED SECOND AMENDED AND RESTATED

CREDIT AGREEMENT

This FOURTH AMENDMENT, dated as of March 31, 2008 (this “ Amendment ”) to the UNCOMMITTED SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of March 30, 2005 (as amended by the First Amendment, dated as of November 28, 2005 (the “ First Amendment ”), the Second Amendment dated as of March 31, 2006 (the “ Second Amendment ”), the Third Amendment dated as of March 30, 2007 (the “ Third Amendment ”) and as otherwise amended, restated, supplemented or modified prior to the date hereof, the “ Credit Agreement ”) among ATMOS ENERGY MARKETING, LLC, a Delaware limited liability company (the “ Borrower ”), the financial institutions from time to time parties thereto (the “ Banks ”), FORTIS CAPITAL CORP., a Connecticut corporation (“ Fortis ”), as Joint Lead Arranger and Joint Bookrunner, as Administrative Agent for the Banks, as Collateral Agent, as an Issuing Bank, and as a Bank, BNP PARIBAS, a bank organized under the laws of France (“ BNP Paribas ”), as Joint Lead Arranger and Joint Bookrunner, as Documentation Agent (together with the Administrative Agent, the “ Agents ”), as an Issuing Bank and as a Bank, and SOCIÉTÉ GÉNÉRALE, as Syndication Agent and as a Bank.

WHEREAS, the Borrower has requested that the financial institutions party hereto make certain amendments to the Credit Agreement on the terms and subject to the conditions set forth herein; and

WHEREAS, the financial institutions party hereto have indicated their willingness to consider such amendments on the terms and conditions of this Amendment;

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

1. Defined Terms . Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings ascribed to them in the Credit Agreement.

2. Amendments to Section 1.01 of the Credit Agreement . Section 1.01 of the Credit Agreement is hereby amended by deleting the following definitions: “360-Day L/C Maturity Date,” “Adjusted Pro Rata Share,” “Applicable Margin,” “Banks,” “Borrowing Base Advance Cap,” “Borrowing Base Line,” “Borrowing Base Sub-Cap,” “Eligible Assignee,” “Expiration Date,” “Indebtedness,” “Loan Documents,” “Maturity Date,” “Obligations,” “Swap Banks,” and “Swap Contracts” in their respective entireties and substituting in lieu thereof the following in the appropriate alphabetical order:

360-Day L/C Maturity Date ” means March 31, 2010.

Adjusted Pro Rata Share ” has the meaning ascribed to such term in the Intercreditor Agreement.

Applicable Margin ” means (i) with respect to Base Rate Loans, .250% per annum and (ii) with respect to Offshore Rate Loans and Letters of Credit, for any day, the applicable rate per annum set forth below, based upon the Excess Tangible Net Worth determined as the last day of the most recently ended fiscal quarter:

 

Excess Tangible Net Worth

   Applicable
Margin for
Offshore
Rate
Loans
  Applicable
Margin for
Letters of Credit
(including
Physical Trade
Delivery-Related
Standby Letters
of Credit)
 

Applicable Margin
for SPT-Related
Standby Letters of
Credit (other than
Physical Trade
Delivery-Related
Standby Letters of
Credit)

Less than or equal to $25,000,000

   1.625%   1.375%   1.875%

Greater than $25,000,000 and less than or equal to $50,000,000

   1.500%   1.250%   1.750%

Greater than $50,000,000 and less or equal to $75,000,000

   1.375%   1.125%   1.625%

Greater than $75,000,000

   1.250%   1.000%   1.500%

For the purposes of the foregoing, the Excess Tangible Net Worth shall be determined based upon the Borrower’s most recent consolidated financial statements delivered pursuant to Section 7.01(c), and each change in the Applicable Margin resulting from a change in the Excess Tangible Net Worth shall be effective during the period commencing on and including the date of delivery to the Administrative Agent of such consolidated financial statements indicating such change and ending on the date immediately preceding the effective date of the next such change; provided that the Excess Tangible Net Worth shall be deemed to be less than or equal to $25,000,000 at any time that an Event of Default has occurred and is continuing.

Banks ” shall mean Fortis, BNP Paribas, Société Générale, NATIXIS, acting through its New York Branch, RZB Finance, LLC, The Bank of Tokyo-Mitsubishi UFJ, Ltd. (as successor by merger to UFJ Bank Limited, New York Branch), Brown Brothers Harriman & Co., The Royal Bank of Scotland plc and each additional lending institution added to this Agreement, through an amendment to this Agreement, by execution of an Uncommitted Line Portion Addendum, or through an Assignment and Acceptance in accordance with Subsection 11.08(a) hereof. References to the “Banks” shall include Fortis and BNP Paribas, including each in its capacity as an Issuing Bank; for purposes of clarification only, to the extent that Fortis or BNP Paribas may have any rights or obligations in addition to those of the Banks due to their status as an Issuing Bank and as Agents, Fortis’ and BNP Paribas’ status as such will be specifically referenced.

Borrowing Base Advance Cap ” means at any time an amount equal to the least of:

 

  (a) $580,000,000;

 

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  (b) the Total Subscribed Line Portions;

 

  (c) the Borrowing Base Sub-Cap; or

 

  (d) the sum of:

(i) the amount of Cash Collateral and other liquid investments which are acceptable to the Banks in their sole discretion and which are subject to a first perfected security interest in favor of Administrative Agent, as collateral agent for the Banks, and which have not been used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance; plus

(ii) 90% of Borrower’s equity in Eligible Broker accounts from and after the date that a tri-party agreement with respect to such accounts is entered into, to the extent such equity is not being used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance; plus

(iii) 90% of the amount of Tier I Accounts which are not being used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance, net of deductions, offsets and counterclaims; plus

(iv) 85% of the amount of Tier II Accounts which are not being used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance, net of deductions, offsets and counterclaims; plus

(v) 85% of the amount of Tier I Unbilled Accounts which are not being used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance; plus

(vi) 80% of the amount of Tier II Unbilled Accounts which are not being used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance; plus

(vii) 80% of the amount of Eligible Inventory which are not being used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance; plus

(viii) 80% of the amount of Eligible Exchange Receivables which are not being used in determining availability for any other advance (other than advances made under the Borrowing Base Line) or Letter of Credit Issuance; plus

(ix) 80% of the amount of Undelivered Product Value; plus

(x) 70% of Realizable Unrealized Profits, up to a maximum amount of $50,000,000, less

 

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(xi) the amounts which would be subject to a so-called “First Purchaser Lien” as defined in Texas Bus. & Com. Code Section 9.343, comparable laws of the states of Oklahoma, Kansas or New Mexico, or any other comparable law of any other state, unless a Letter of Credit secures payment of all amounts subject to such First Purchaser Lien; less

(xii) 125% of the SPT Bank Close-Out Amounts of all SPT Banks, as of the date of determination of the Borrowing Base Advance Cap; and less

(xiii) 100% of the Borrower’s Unrealized Mark-to-Market Losses as of the date of determination of the Borrowing Base Advance Cap.

In no event shall any amounts described in (d)(i) through (d)(x) above which may fall into more than one of such categories be counted more than once when making the calculation under this definition.

Borrowing Base Line ” means the uncommitted line of credit for the purpose of (a) providing working capital and to fund payments to suppliers of Product; (b) to provide for Letters of Credit to secure suppliers of Product; and (c) to fund payments due to any SPT Bank under any SPT Contract.

Borrowing Base Sub-Cap ” means (a) from the date of this Agreement until the date the first election is made by the Borrower pursuant to clause (b) of this definition, $250,000,000, and (b) thereafter, at any time, the amount set forth in the table below under the heading “ Borrowing Base Sub-Cap ” elected by the Borrower from time to time by written notice to the Agents, provided that, at the time of any such election of any such amount as the Borrowing Base Sub-Cap, but not for any other purpose herein, each of the Borrower’s Net Working Capital, Tangible Net Worth and ratio of Total Liabilities to Tangible Net Worth at such time of election, each as determined by the most recent monthly financial statements received pursuant to Section 7.01(c) are within the requirements set forth opposite such amount in the table below. For purposes of testing whether such requirements have been met, the highest amount elected by the Borrower for the month being tested shall be used, where during the same month being tested the Borrower elected to either increase or decrease the availability by selecting a different amount under the column entitled “Borrowing Base Sub-Cap”.

 

Borrowing Base Sub-Cap

  

Minimum Net

Working Capital

  

Minimum Tangible

Net Worth

  

Maximum Ratio at

Total Liabilities to

Tangible Net Worth

$100,000,000

   $20,000,000    $21,000,000    5.00 to 1

$125,000,000

   $25,000,000    $26,000,000    5.00 to 1

$150,000,000

   $30,000,000    $31,000,000    5.00 to 1

$175,000,000

   $35,000,000    $36,000,000    5.00 to 1

$200,000,000

   $40,000,000    $41,000,000    5.00 to 1

$225,000,000

   $45,000,000    $46,000,000    5.00 to 1

$250,000,000

   $50,000,000    $51,000,000    5.00 to 1

$275,000,000

   $55,000,000    $56,000,000    5.00 to 1

$300,000,000

   $60,000,000    $61,000,000    5.00 to 1

$325,000,000

   $65,000,000    $66,000,000    5.00 to 1

$350,000,000

   $70,000,000    $71,000,000    5.00 to 1

$375,000,000

   $75,000,000    $76,000,000    5.00 to 1

$400,000,000

   $80,000,000    $81,000,000    5.00 to 1

$425,000,000

   $85,000,000    $86,000,000    5.00 to 1

$450,000,000

   $90,000,000    $91,000,000    5.00 to 1

$475,000,000

   $95,000,000    $96,000,000    5.00 to 1

$500,000,000

   $100,000,000    $101,000,000    5.00 to 1

$525,000,000

   $105,000,000    $106,000,000    5.00 to 1

$550,000,000

   $110,000,000    $111,000,000    5.00 to 1

$575,000,000

   $115,000,000    $116,000,000    5.00 to 1

$580,000,000

   $120,000,000    $121,000,000    5.00 to 1

 

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Eligible Assignee ” means (a) a commercial bank organized under the laws of the United States, or any state thereof, and having a combined capital and surplus of at least $100,000,000; (b) a commercial bank organized under the laws of any other country which is a member of the Organization for Economic Cooperation and Development (the “ OECD ”), or a political subdivision of any such country, and having a combined capital and surplus of at least $100,000,000, provided , however , that such bank is acting through a branch or agency located in the United States; and (c) a Person that is primarily engaged in the business of commercial lending and that is (i) a Subsidiary of a Bank (or bank referred to in the preceding clauses (a) or (b)), (ii) a Subsidiary of a Person of which a Bank (or bank referred to in the preceding clauses (a) or (b)) is a Subsidiary, or (iii) a Person of which a Bank (or bank referred to in the preceding clauses (a) or (b)) is a Subsidiary.

Expiration Date ” means the earliest to occur of:

 

  (a) March 31, 2009; or

 

  (b) the date demand for payment is made by the Administrative Agent; or

 

  (c) the date an Event of Default occurs.

Indebtedness ” of any Person means, without duplication, (a) all indebtedness for borrowed money; (b) all obligations issued, undertaken or assumed as the deferred purchase price of property or services (other than trade payables entered into in the ordinary course of business on ordinary terms); (c) all non-contingent reimbursement or payment obligations with respect to Surety Instruments; (d) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses; (e) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to property acquired by the Person (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property); (f) all obligations with respect to capital leases; (g) all obligations with respect to swap contract and physical trade contracts (including, for the avoidance of doubt, all SPT Contracts); (h) all indebtedness referred to in clauses (a) through (g) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise,

 

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to be secured by) any Lien upon or in property (including accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such indebtedness; and (i) all Guaranty Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (a) through (g) above.

Loan Documents ” means this Agreement, the Notes, the Guaranty, the Security Agreements, the L/C-Related Documents, SPT Contracts, the Three Party Agreement, the Atmos Support Agreement, the Intercreditor Agreement and all other documents delivered to the Administrative Agent or any Bank in connection herewith.

Maturity Date ” means June 30, 2009.

Obligations ” means all advances, debts, liabilities, obligations, covenants and duties arising under (a) any Loan Document, owing by the Borrower to any Bank, or any affiliate of any Bank, Agents, or any Indemnified Person, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising, including, without limitation, all obligations of the Borrower under Revolving Loans and with respect to Letters of Credit, (b) any Swap Contract, and (c) any Physical Trade Contract.

Swap Banks ” means each of (a) Fortis Capital Corp., BNP Paribas, Société Générale, The Royal Bank of Scotland plc, and NATIXIS, acting through its New York Branch,, or their respective Affiliates, and (b) any other Bank or any Affiliate thereof approved by the Required Banks, in the case of each of the foregoing clauses, in its capacity as a party to a Swap Contract, to the extent that such Bank, or its Affiliate (as the case may be) signs and becomes a party to the Intercreditor Agreement prior to entering into such Swap Contract.

Swap Contract ” means any agreement entered between a Swap Bank and the Borrower, whether or not in writing, relating to any single transaction that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond, note or bill option, interest rate option, forward foreign exchange transaction, cap, collar or floor transaction, currency swap, cross-currency rate swap, currency option or any other similar transaction (including any option to enter into any of the foregoing) or any combination of the foregoing and, unless the context clearly requires, any master agreement relating to or governing any or all of the foregoing.

3. Amendment to Section 1.01 of the Credit Agreement . Section 1.01 of the Credit Agreement is hereby further amended by deleting the definitions of “Assets from Risk Management Activities,” “Cumulative Loss,” and “Liabilities from Risk Management Activities” in their respective entireties.

4. Amendment to Section 1.01 of the Credit Agreement . Section 1.01 of the Credit Agreement is hereby further amended by adding the following new terms: “Adjusted Uncommitted Line Portion,” “Cross-Affiliate Creditor,” “Cross-Affiliate Debtor,” “Cross-Affiliate Netting Liens,” “Cross-Affiliate Pair,” “Intercreditor Agreement,” “Physical Trade

 

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Bank,” “Physical Trade Bank Close-Out Amount,” “Physical Trade Contract,” “Physical Trade Delivery-Related Standby Letter of Credit,” “Physical Trade-Related Standby Letter of Credit,” “Sharing Event,” “SPT Activity Report,” “SPT Bank,” “SPT Bank Close Out Amount,” “SPT Contract,” “SPT-Related Standby Letter of Credit,” “Swap Bank Close-Out Amount,” “Unilateral Overage Advance,” “Unilateral Overage Pro Rata Share,” “Unilateral Physical Trade Bank Overage Advance” and “Unilateral Swap Bank Overage Advance” in the appropriate alphabetical order and as defined below:

Adjusted Uncommitted Line Portion ” has the meaning ascribed to it in Section 2.14 .

Cross-Affiliate Creditor ” means as of any date of determination, with respect to any Cross-Affiliate Pair, each entity, if any, with a positive Swap Bank Close-Out Amount or Physical Trade Bank Close-Out Amount, as applicable. For the avoidance of doubt as of any date of determination (i) both entities comprising a Cross-Affiliate Pair might qualify as Cross-Affiliate Creditors, and (ii) a Cross-Affiliate Creditor is an entity that is owed money by Borrower under a SPT Contract (or would be owed money by the Borrower if its SPT Contracts were terminated as of such date of determination).

Cross-Affiliate Debtor ” means as of any date of determination, with respect to any Cross-Affiliate Pair, each entity, if any, with a negative Swap Bank Close-Out Amount or Physical Trade Bank Close-Out Amount, as applicable. For the avoidance of doubt as of any date of determination (i) both entities comprising a Cross-Affiliate Pair may qualify as Cross-Affiliate Debtors and (ii) a Cross-Affiliate Debtor is an entity that owes money to the Borrower under a SPT Contract (or would owe money to the Borrower if its SPT Contracts were terminated as of such date of determination).

Cross-Affiliate Netting Lien ” means any pledge by the Borrower securing only obligations under a SPT Contract in favor of a Cross-Affiliate Creditor of general intangibles or receivables due from the affiliated Cross-Affiliate Debtor to the Borrower under a Swap Contract or Physical Trade Contract (as the case may be) to the extent such contract (which in the case of master agreements, shall refer to date of the applicable “confirmation” thereunder) was entered into prior to the Bank affiliated with the Cross-Affiliate Pair becoming a Declining Bank hereunder. For the avoidance of doubt, a Cross-Affiliate Netting Lien will be available only where one Cross-Affiliate Pair entity is a Cross-Affiliate Creditor and the other entity is a Cross-Affiliate Debtor.

Cross-Affiliate Pair ” means (i) any Swap Bank that is an Affiliate of a Physical Trade Bank and (ii) any Physical Trade Bank that is an Affiliate of a Swap Bank, in each case, so long as the affiliated Swap Bank and Physical Trade Bank are separate legal entities.

Intercreditor Agreement ” means the Intercreditor Agreement dated on or about the Fourth Amendment Effective Date, among the Agent, the Banks, the Swap Banks and the Physical Trade Banks relating to, among other things, the sharing of Collateral with and among the Swap Banks and Physical Trade Banks upon the occurrence of a Sharing Event.

 

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Physical Trade Bank ” means each of (a) Fortis Capital Corp., BNP Paribas, Société Générale, and The Royal Bank of Scotland plc, or their respective Affiliates, and (b) any other Bank or any Affiliate thereof approved by the Required Banks, in the case of each of the foregoing clauses, in its capacity as a party to a Physical Trade Contract, to the extent that such Bank, or its Affiliate (as the case may be) signs and becomes a party to the Intercreditor Agreement prior to entering into such Physical Trade Contract.

Physical Trade Bank Close-Out Amount ” has the meaning ascribed to such term in the Intercreditor Agreement.

Physical Trade Contract ” means any agreement entered between a Physical Trade Bank and the Borrower, whether or not in writing, relating to any single transaction that is for the purchase, sale, transfer or exchange of natural gas or any other similar transaction (including any option to enter into any of the foregoing) or any combination of the foregoing and, unless the context clearly requires, any master agreement relating to or governing any or all of the foregoing.

Physical Trade Delivery-Related Standby Letter of Credit ” means any Physical Trade-Related Standby Letter of Credit issued to support payment obligations of the Borrower owed or to become due to a Physical Trade Bank for natural gas that has been delivered or will be delivered to the Borrower by such Physical Trade Bank.

Physical Trade-Related Standby Letter of Credit ” means any Letter of Credit issued under the Letter of Credit Facility to support obligations of the Borrower under a Physical Trade Contract.

Sharing Event ” has the meaning ascribed to such term in the Intercreditor Agreement.

SPT Activity Report ” means a report detailing all SPT Close-Out Amounts and the SPT Activity Utilization Ratio (as defined therein) to be used for monitoring the availability of SPT-Related Letters of Credit and compliance with the covenant set forth in Section 8.16, which report shall be substantially in the form attached hereto as Exhibit J .

SPT Bank ” means each Swap Bank and each Physical Trade Bank.

SPT Bank Close-Out Amounts ” has the meaning ascribed to such term in the Intercreditor Agreement.

SPT Contract ” means each Swap Contract and each Physical Trade Contract.

SPT-Related Standby Letter of Credit ” means any Letter of Credit issued under the Letter of Credit Facility to support obligations of the Borrower under (i) any SPT Contract or (ii) any other swap contract or physical trade contract.

Swap Bank Close-Out Amount ” has the meaning ascribed to such term in the Intercreditor Agreement.

 

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Unilateral Overage Advance ” means (i) any Unilateral Swap Bank Overage Advance, and (ii) any Unilateral Physical Trade Bank Overage Advance.

Unilateral Overage Pro Rata Share ” means, as to any Bank at any time, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of such Bank’s (i) aggregate Unilateral Overage Advances plus all interest due thereon, divided by (ii) the combined total Unilateral Overage Advances of all Banks plus all interest due thereon.

Unilateral Physical Trade Bank Overage Advance ” has the meaning ascribed to such term in Section 2.01(c) hereof.

Unilateral Swap Bank Overage Advance ” has the meaning ascribed to such term in Section 2.01(b) hereof.

5. Amendment to Section 2.01 of the Credit Agreement . (a) Section 2.01(b) is hereby amended by deleting the existing Section 2.01(b) in its entirety and inserting in lieu thereof the following:

(b) Advances Related to the Swap Contracts. In addition to advances requested from time to time by the Borrower, in the event that any amounts owing to any Swap Bank or any of its Affiliates under any Swap Contract are not paid within two (2) Business Days after such obligation becomes due thereunder (whether at a scheduled date, by acceleration, early termination, on demand, or otherwise) then such Swap Bank shall notify the Administrative Agent of such failure to pay and the Administrative Agent (without the necessity of any instructions or request from the Borrower) shall, during the period from the Closing Date until the Expiration Date, make a Revolving Loan in accordance with the provisions of Section 2.03 of this Agreement under the Borrowing Base Line but only to the extent approved (after notice from the Administrative Agent that the requested advance is to be made to cover obligations of the Borrower under a Swap Contract) and funded in accordance with the procedures set forth in such Section 2.03 by each Bank with respect to its Pro Rata Share (or to the extent that a Conversion to Reduced Funding Banks Date has occurred as of such date, the then Approving Banks with respect to their respective Pro Rata Shares), or, with respect to any amount in excess of the Borrowing Base Advance Cap (measured against the then-outstanding amount of Borrower Obligations hereunder (which, for the avoidance of doubt shall include all then-outstanding Unilateral Overage Advance amounts of any Bank and shall exclude the amount of the then-current Unilateral Swap Bank Overage Advance made pursuant to this Section 2.01(b), if any)), pursuant to a Unilateral Swap Bank Overage Advance as set forth in this Section 2.01(b) but only to the extent approved and funded in accordance with the procedures set forth in Section 2.03 by the applicable Swap Bank or if such Swap Bank is not itself a Bank hereunder, its Bank Affiliate hereunder for any amounts due by the Borrower to such Swap Bank or any of its Affiliates under any Swap Contract (including, without limitation, any amounts required to be deposited as cash collateral by the Borrower in connection therewith), and then apply the proceeds of such advance to pay to such Swap Bank or any of its Affiliates all amounts owed to such Person under such Swap Contract (including, without limitation, any amounts required to be deposited as cash collateral by the Borrower in connection therewith). Upon making any such advance as provided above, the Administrative Agent shall send notice of such advance to the Borrower and the Banks. Any such advance shall initially be a Base Rate Loan. In the event that after giving effect to any such advance made to fund such Swap Bank or any of its Affiliates, the then-outstanding amount of the Borrower Obligations hereunder (which, for the avoidance of doubt shall include

 

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all then-outstanding Unilateral Overage Advance amounts of any Bank and shall exclude the amount of the Unilateral Swap Bank Overage Advance resulting from such advance, if any) would exceed the Borrowing Base Advance Cap, the Banks shall have no duty to fund their pro rata share of any excess resulting from such advance made to repay amounts owing to such Swap Bank or any of its Affiliates under any Swap Contract (including, without limitation, any amounts required to be deposited as cash collateral by the Borrower in connection therewith), but such Swap Bank’s (or if such Swap Bank is not itself a Bank hereunder, its Bank Affiliate’s) outstandings hereunder shall be deemed to be increased by the amount of such excess funded by such Swap Bank (or if such Swap Bank is not itself a Bank, its Bank Affiliate hereunder) as provided above in accordance with Section 2.03 (any such increase, a “ Unilateral Swap Bank Overage Advance ”). With respect to any Unilateral Swap Bank Overage Advance, the Borrower shall pay to the Administrative Agent, for the benefit of the applicable Swap Bank (or its Bank Affiliate hereunder), the amount of such Unilateral Swap Bank Overage Advance, together with interest thereon, within one (1) Business Day after the date of such advance and, notwithstanding anything to the contrary herein, no other Bank shall share in the payment of such Unilateral Swap Bank Overage Advance.”

(b) Section 2.01 is hereby amended by adding the following new Section 2.01(c) in the appropriate alphabetical order:

(c) Advances Related to the Physical Trade Contracts. In addition to advances requested from time to time by the Borrower, in the event that any amounts owing to any Physical Trade Bank or any of its Affiliates under any Physical Trade Contract are not paid within two (2) Business Days after such obligation becomes due thereunder (whether at a scheduled date, by acceleration, early termination, on demand, or otherwise) then such Physical Trade Bank shall notify the Administrative Agent of such failure to pay and the Administrative Agent (without the necessity of any instructions or request from the Borrower) shall, during the period from the Closing Date until the Expiration Date, make a Revolving Loan in accordance with the provisions of Section 2.03 of this Agreement under the Borrowing Base Line but only to the extent approved (after notice from the Administrative Agent that the requested advance is to be made to cover obligations of the Borrower under a Physical Trade Contract) and funded in accordance with the procedures set forth in such Section 2.03 by each Bank with respect to its Pro Rata Share (or to the extent that a Conversion to Reduced Funding Banks Date has occurred as of such date, the then Approving Banks with respect to their respective Pro Rata Shares), or, with respect to any amount in excess of the Borrowing Base Advance Cap (measured against the then-outstanding amount of Borrower Obligations hereunder (which, for the avoidance of doubt shall include all then-outstanding Unilateral Overage Advance amounts of any Bank and shall exclude the amount of the then-current Unilateral Physical Trade Bank Overage Advance made pursuant to this Section 2.01(c), if any)), pursuant to a Unilateral Physical Trade Bank Overage Advance as set forth in this Section 2.01(c) but only to the extent approved and funded in accordance with the procedures set forth in Section 2.03 by the applicable Physical Trade Bank or if such Physical Trade Bank is not itself a Bank hereunder, its Bank Affiliate hereunder for any amounts due by the Borrower to such Physical Trade Bank or any of its Affiliates under any Physical Trade Contract (including, without limitation, any amounts required to be deposited as cash collateral by the Borrower in connection therewith), and then apply the proceeds of such advance to pay to such Physical Trade Bank or any of its Affiliates all amounts owed to such Person under such Physical Trade Contract (including, without

 

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limitation, any amounts required to be deposited as cash collateral by the Borrower in connection therewith). Upon making any such advance as provided above, the Administrative Agent shall send notice of such advance to the Borrower and the Banks. Any such advance shall initially be a Base Rate Loan. In the event that after giving effect to any such advance made to fund such Physical Trade Bank or any of its Affiliates, the then-outstanding amount of the Borrower Obligations hereunder (which, for the avoidance of doubt shall include all then-outstanding Unilateral Overage Advance amounts of any Bank and shall exclude the amount of the Unilateral Physical Trade Bank Overage Advance resulting from such advance, if any) would exceed the Borrowing Base Advance Cap, the Banks shall have no duty to fund their pro rata share of any excess resulting from such advance made to repay amounts owing to such Physical Trade Bank or any of its Affiliates under any Physical Trade Contract (including, without limitation, any amounts required to be deposited as cash collateral by the Borrower in connection therewith), but such Physical Trade Bank’s (or if such Physical Trade Bank is not itself a Bank hereunder, its Bank Affiliate’s) outstandings hereunder shall be deemed to be increased by the amount of such excess funded by such Physical Trade Bank (or if such Physical Trade Bank is not itself a Bank, its Bank Affiliate hereunder) as provided above in accordance with Section 2.03 (any such increase, a “ Unilateral Physical Trade Bank Overage Advance ”). With respect to any Unilateral Physical Trade Bank Overage Advance, the Borrower shall pay to the Administrative Agent, for the benefit of the applicable Physical Trade Bank (or its Bank Affiliate hereunder), the amount of such Unilateral Physical Trade Bank Overage Advance, together with interest thereon, within one (1) Business Day after the date of such advance and, notwithstanding anything to the contrary herein, no other Bank shall share in the payment of such Unilateral Physical Trade Bank Overage Advance.

THE BORROWER ACKNOWLEDGES AND AGREES THAT THE BANKS HAVE ABSOLUTELY NO DUTY TO FUND ANY REVOLVING LOAN REQUESTED BY THE BORROWER BUT WILL EVALUATE EACH LOAN REQUEST AND IN EACH BANK’S ABSOLUTE AND SOLE DISCRETION WILL DECIDE WHETHER TO FUND SUCH LOAN REQUEST. THE BORROWER FURTHER ACKNOWLEDGES AND AGREES THAT THE SWAP BANKS HAVE ABSOLUTELY NO DUTY TO ENTER INTO ANY SWAP CONTRACT, AND THE ENTERING INTO OF ANY SWAP CONTRACT SHALL BE AT THE ABSOLUTE AND SOLE DISCRETION OF THE SWAP BANKS. THE BORROWER FURTHER ACKNOWLEDGES AND AGREES THAT THE PHYSICAL TRADE BANKS HAVE ABSOLUTELY NO DUTY TO ENTER INTO ANY PHYSICAL TRADE CONTRACT, AND THE ENTERING INTO OF ANY PHYSICAL TRADE CONTRACT SHALL BE AT THE ABSOLUTE AND SOLE DISCRETION OF THE PHYSICAL TRADE BANKS.”

6. Amendment to Section 2.07 of the Credit Agreement . Section 2.07 is hereby amended by deleting the existing Section 2.07 in its entirety and inserting in lieu thereof the following:

“2.07 Repayment . The Borrower shall repay the principal amount of each Revolving Loan to the Administrative Agent on behalf of the Banks, on the Advance Maturity Date for such Loan. All amounts owing a Swap Bank under any Swap Contract, to the extent such amounts have not been repaid from the proceeds of a

 

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Revolving Loan pursuant to Section 2.01(b) hereof, shall be paid on demand, or if no demand is made, on the first (1st) Business Day after the Borrower receives notice that such amount was advanced by or becomes owing to a Swap Bank. All amounts owing a Physical Trade Bank under any Physical Trade Contract, to the extent such amounts have not been repaid from the proceeds of a Revolving Loan pursuant to Section 2.01(c) hereof, shall be paid on demand, or if no demand is made, on the first (1st) Business Day after the Borrower receives notice that such amount was advanced by or becomes owing to a Physical Trade Bank.”

7. Amendment to Section 2.08(a) of Credit Agreement . Section 2.08(a) is hereby amended by deleting the existing Section 2.08(a) in its entirety and inserting in lieu thereof the following:

“(a) Each Revolving Loan (except for a Revolving Loan made as a result of a drawing under a Letter of Credit or a Reducing L/C Borrowing) shall bear interest on the outstanding principal amount thereof from the applicable Borrowing Date at a floating rate per annum equal to the Base Rate plus the Applicable Margin at all times such Loan is a Base Rate Loan or at the Offshore Rate plus the Applicable Margin at all times such Loan is an Offshore Rate Loan. Each Revolving Loan made as a result of a drawing under a Letter of Credit or a Reducing L/C Borrowing and all amounts owing with respect to any Bank with respect to any Unilateral Overage Advance shall bear interest on the outstanding principal amount thereof from the date funded at a floating rate per annum equal to the Base Rate plus the Applicable Margin until such Loan or other amounts owing to a Bank with respect to a Unilateral Overage Advance has been outstanding for more than two (2) Business Days and, thereafter, shall bear interest on the outstanding principal amount thereof at a floating rate per annum equal to the Base Rate, plus three percent (3.0%) per annum (the “ Default Rate ”).”

8. Amendment to Section 2.11(a) of the Credit Agreement . Section 2.11(a) is hereby amended by deleting the existing Section 2.11(a) in its entirety and inserting in lieu thereof the following.

“(a) All payments to be made by the Borrower shall be made without set-off, recoupment or counterclaim. Except as otherwise expressly provided herein, all payments by the Borrower in respect of Obligations hereunder, shall be made to the Administrative Agent for the account of the Banks at the Administrative Agent’s Payment Office, and shall be made in dollars and in immediately available funds, no later than 1:00 p.m. (New York City time) on the date specified herein. For any payment received by the Administrative Agent from or on behalf of the Borrower in respect of Obligations that are then due and payable (unless such payment is being made pursuant to Section 2.05) prior to the occurrence of a Sharing Event, the Administrative Agent will promptly distribute such payment in like funds as received as follows: first , to each Bank, its Pro Rata Share; and second , to each Bank, its Unilateral Overage Pro Rata Share, provided , however , that any payment received solely with respect to any Unilateral Overage Advance within one (1) Business Day of such advance in accordance with Sections 2.01(b) or (c)  hereof, as applicable, shall be distributed to each Bank according to its Unilateral Overage Pro Rata Share.

 

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For any payment received from or on behalf of the Borrower by the Administrative Agent on or after the occurrence of a Sharing Event, the Administrative Agent will promptly distribute such payment in accordance with Section 2.01 of the Intercreditor Agreement. Any payment received by the Administrative Agent later than 1:00 p.m. (New York City time) shall be deemed to have been received on the following Business Day and any applicable interest or fee shall continue to accrue. If and to the extent the Borrower makes a payment in full to the Administrative Agent no later than 1:00 p.m. (New York City time) on any Business Day and the Administrative Agent does not distribute to each Bank its Pro Rata Share of such payment in like funds as received on the same Business Day, the Administrative Agent shall pay to each Bank on demand interest on such amount as should have been distributed to such Bank at the Federal Funds Rate for each day from the date such payment was received until the date such amount is distributed.”

9. Amendment to Section 2.13 of the Credit Agreement . Section 2.13 is hereby amended by deleting the existing Section 2.13 in its entirety and inserting in lieu thereof the following:

“2.13 Sharing of Payments, Etc. If, other than as expressly provided elsewhere herein (or, after the occurrence of a Sharing Event, as provided in the Intercreditor Agreement), any Bank shall obtain on account of the Loans (or other Obligations referenced in clause (a) of the definition of such term) made or undertaken by such Bank any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise) in excess of its Pro Rata Share such Bank shall immediately (a) notify the Administrative Agent of such fact, and (b) purchase from the other Banks such participations in the Loans (or other Obligations referenced in clause (a) of the definition of such term) made or undertaken by them as shall be necessary to cause such purchasing Bank to share the excess payment pro rata with each of them; provided , however , that if all or any portion of such excess payment is thereafter recovered from the purchasing Bank, such purchase shall to that extent be rescinded and each other Bank shall repay to the purchasing Bank the purchase price paid therefor, together with an amount equal to such paying Bank’s ratable share (according to the proportion of (i) the amount of such paying Bank’s required repayment to (ii) the total amount so recovered from the purchasing Bank) of any interest or other amount paid or payable by the purchasing Bank in respect of the total amount so recovered. The Borrower agrees that any Bank so purchasing a participation from another Bank may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off, but subject to Section 11.09 ) with respect to such participation as fully as if such Bank were the direct creditor of the Borrower in the amount of such participation. The Administrative Agent will keep records (which shall be conclusive and binding in the absence of manifest error) of participations purchased under this Section and will in each case notify the Banks following any such purchases or repayments.”

10. Amendment to Section 2.14 of the Credit Agreement . Section 2.14 is hereby amended by deleting it in its entirety and substituting the following new Section 2.14 in lieu thereof:

 

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“Section 2.14. The Election of Approving Banks to Continue Funding .

(a) Notice of Disapproval . If on any Business Day one or more Banks (the “ Declining Bank ” or “ Declining Banks ”) provides the Administrative Agent with, and the Administrative Agent has actually received, a written notice in the form of Exhibit H of its disapproval, for reasons other than a Default, of further advances and issuances of Letters of Credit, and the other Bank or Banks approve further Revolving Loans (including the conversion and extension of such Revolving Loans) or the further issuances of, extensions of, the automatic renewal of or amendment to Letters of Credit, the Administrative Agent shall notify the Banks by 6:00 p.m. (New York City time) that same day.

(b) Further Credit Extensions . If the Bank or Banks which are not the Declining Banks desire, they may (on a pro rata basis, based on the Uncommitted Line Portion of all Banks that have elected to continue funding, as adjusted after such Conversion to Reduced Funding Banks Date (the “ Adjusted Uncommitted Line Portion ”), after which such date the Uncommitted Line Portion of all Declining Banks shall be reduced to zero) make the full or partial amount of such requested Revolving Loan or issue or amend the requested Letter of Credit irrespective of the Declining Banks’ disapproval (in such case, the Banks that elect to continue funding shall be referred to as the “ Approving Banks ” in respect of such Conversion to Reduced Funding Banks Date) but not in an aggregate amount that would exceed such Bank’s Adjusted Uncommitted Line Portion unless agreed in writing by such Bank. In such event, from each such date (each, a “ Conversion to Reduced Funding Banks Date ”) forward (or until the next Conversion to Reduced Funding Banks Date, if any, at which time one or more Banks that had been Approving Banks may become a Declining Bank), all subsequent Revolving Loans and Issuances of Letters of Credit or amendments to Letters of Credit that increase the face amount of a Letter of Credit (subject to Section 11.01 ) or extend the term of a Letter of Credit shall be made or issued and participated in unilaterally by the Approving Banks in respect of such Conversion to Reduced Funding Banks Date and no Letter of Credit thereafter Issued or amended to increase the amount or extended shall be participated in by the Declining Banks in respect of such Conversion to Reduced Funding Banks Date.

(c) Swap Banks . A Bank that becomes a Declining Bank shall not (nor shall its Affiliates) be considered a Swap Bank with respect to Swap Contracts (which, in the case of master agreements, shall refer to the date of the applicable “confirmation” thereunder) executed after it has become a Declining Bank. Accordingly, if a Swap Bank should execute a Swap Contract with the Borrower after it or its Affiliate has become a Declining Bank, the Borrower’s obligations under such Swap Contract shall not be secured by the Collateral hereunder, and the Declining Bank shall not be entitled to any sharing of amounts pursuant to the Intercreditor Agreement with respect to such Swap Contracts executed after it has become a Declining Bank. For the avoidance of doubt, the Borrower’s then-existing obligations under any Swap Contract entered with such Swap Bank prior to such Swap Bank’s Affiliate becoming a Declining Bank shall remain secured by the Collateral as provided in the Intercreditor Agreement to the extent that such obligations are not subsequently amended, supplemented or otherwise modified.

 

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(d) Physical Trade Banks . A Bank that becomes a Declining Bank shall not (nor shall its Affiliates) be considered a Physical Trade Bank with respect to Physical Trade Contracts (which, in the case of master agreements, shall refer to the date of the applicable “confirmation” thereunder) executed after it has become a Declining Bank. Accordingly, if a Physical Trade Bank should execute a Physical Trade Contract with the Borrower after it or its Affiliate has become a Declining Bank, the Borrower’s obligations under such Physical Trade Contract shall not be secured by the Collateral hereunder, and the Declining Bank shall not be entitled to any sharing of amounts pursuant to the Intercreditor Agreement with respect to such Physical Trade Contracts executed after if has become a Declining Bank. For the avoidance of doubt, the Borrower’s then-existing obligations under any Physical Trade Contract entered with such Physical Trade Bank prior to such Physical Trade Bank’s Affiliate becoming a Declining Bank shall remain secured by the Collateral as provided in the Intercreditor Agreement, to the extent that such obligations are not subsequently amended, supplemented or otherwise modified.

(e) Repayments . Until all Declining Banks are fully repaid, repayments (including realizations from Collateral) shall be applied as follows:

(i) For purposes of allocating repayments prior to the occurrence of a Sharing Event, the Pro Rata Share of each Bank with respect to Loans and Letters of Credit outstanding on a specified Conversion to Reduced Funding Banks Date shall remain fixed at the percentage held by such Bank the day before such specified Conversion to Reduced Funding Banks Date, without respect to any changes which may subsequently occur in such Bank’s Pro Rata Share (prior to the next Conversion to Reduced Funding Banks Date) until such time, if any, that all Declining Banks are fully repaid. Upon the occurrence of the first Conversion to Reduced Funding Banks Date and thereafter, repayments of all outstanding Loans shall be applied to the Loans with the earliest advance date, notwithstanding the tenor of the Loans.

(ii) Following the occurrence of a Sharing Event and thereafter, repayments shall be allocated according to Section 2.01 of the Intercreditor Agreement.”

11. Amendment to Section 2.15 of the Credit Agreement . Section 2.15 is hereby amended by deleting it in its entirety and substituting the following new Section 2.15 in lieu thereof:

“2.15 Payments from Guarantor and Liquidation of Collateral . So long as no Sharing Event has occurred and notwithstanding anything to the contrary contained herein, in the event repayment is made to the Banks with respect to the Obligations of the Borrower (or any Affiliate thereof) hereunder by Guarantor or pursuant to a liquidation of Collateral, such repayment shall be shared by the Banks as provided in Section 2.11(a) hereof and upon the occurrence of a Sharing Event, such repayment shall be shared by the Banks in accordance with the Intercreditor Agreement.”

 

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12. Amendment to Section 3.01 of the Credit Agreement . (a) Section 3.01(a) is hereby amended by deleting the fourth sentence therein, which begins “No Swap-Related Standby Letter of Credit shall be issued if” in its entirety and inserting in lieu thereof the following new sentence:

“No SPT-Related Standby Letter of Credit shall be Issued if, after giving effect to such Issuance, the outstanding amounts of all SPT-Related Standby Letters of Credit (excluding all Physical Trade Delivery-Related Standby Letters of Credit) plus the aggregate SPT Bank Close-Out Amounts of all SPT Banks plus the aggregate outstanding Unilateral Overage Advances of all Banks would exceed $50,000,000.”

(b) Section 3.01(b)(iii) is hereby amended by deleting it in its entirety and inserting in lieu thereof the following new Section 3.01(b)(iii) in lieu thereof:

“(iii) the expiry date of any requested Letter of Credit is after the earlier to occur of (A) 90 days after the date of Issuance of such Letter of Credit or solely in the case of any 360-Day Letter of Credit, 360 days after the date of Issuance of such 360-Day Letter of Credit or (B) the Maturity Date, or, solely in the case of a 360-Day Letter of Credit, the 360-Day L/C Maturity Date, unless all the Banks have approved such expiry date in writing, but any SPT-Related Standby Letter of Credit may by its terms be renewable for successive 90-day periods unless a notice that the applicable Issuing Bank declines to renew such Letter of Credit is given to the applicable Issuing Bank and the Administrative Agent on or prior to any date for notice of non-renewal to the beneficiary set forth in such SPT-Related Standby Letter of Credit, but in any event at least five Business Days prior to the date of the notice of non-renewal of such SPT-Related Standby Letter of Credit, any such automatic renewal of a Letter of Credit being subject to the fulfillment of the applicable conditions set forth in Article V; provided that the terms of each of the SPT-Related Standby Letters of Credit that is automatically renewable (1) shall require the applicable Issuing Bank to give the beneficiary of such SPT-Related Standby Letter of Credit notice of any non-renewal prior to the expiry date, (2) shall permit such beneficiary, upon receipt of such notice, to draw under such SPT-Related Standby Letter of Credit prior to the expiry date of the SPT-Related Standby Letter of Credit, and (3) shall not permit the expiry date (after giving effect to any renewal) of such SPT-Related Standby Letter of Credit in any event to be extended to a date that is later than the Maturity Date. If a notice of non-renewal is given by the applicable Issuing Bank pursuant to the immediately preceding sentence, the related SPT-Related Standby Letter of Credit shall expire on its expiry date;”

13. Amendment to Section 3.02 of the Credit Agreement . (a) Section 3.02 is hereby amended by replacing each reference to “Swap-Related Standby Letter of Credit” with the new term, “SPT-Related Standby Letter of Credit”.

(b) Section 3.02(a)(ii) is hereby further amended by adding, immediately after the first reference to “SPT-Related Standby Letter of Credit” appearing in such clause (ii) and immediately before the existing language “or other standby letter of credit” in such clause (ii), the following new language “, Physical Trade Delivery-Related Standby Letter of Credit”.

 

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14. Amendment to Section 7.02 of the Credit Agreement . Section 7.02 is hereby amended by deleting the word “and” as it appears at the end of subsection 7.02(d); by deleting “.” at the end of subsection 7.02(e) and adding in lieu thereof, “; and”; and by adding the following new subsection as 7.02(f):

“(f) a SPT Activity Report executed by a Responsible Officer of the Borrower as of 15th day of each month and as of the last Business Day of each month, in each case delivered within ten (10) days of such reporting date; provided that if any such SPT Activity Report evidences that the Borrower has a “SPT Activity Utilization Ratio” (as defined therein) of 90% or more, then the Borrower shall provide additional SPT Activity Reports on the 7 th day and the 22 nd day of each month, in each case delivered within seven (7) days of such reporting date, until such time as the last delivered SPT Activity Report evidences a “SPT Activity Utilization Ratio” of 80% or less.”

15. Amendment to Section 7.15 of the Credit Agreement . Section 7.15 is hereby amended by deleting it in its entirety and substituting the following new Section 7.15 in lieu thereof:

“The Borrower will, at all times, maintain, with respect to the elected Borrowing Base Sub-Cap for such time, (a) Net Working Capital and Tangible Net Worth, each at a level not less than the minimum threshold set forth opposite such applicable Borrowing Base Sub-Cap under the heading “Minimum Net Working Capital” and “Minimum Tangible Net Worth”, as applicable, under the definition of Borrowing Base Sub-Cap, and (b) the Ratio of Total Liabilities to Tangible Net Worth, at a level not more than the maximum threshold set forth opposite such applicable Borrowing Base Sub-Cap under the heading “Maximum Ratio at Total Liabilities to Tangible Net Worth” under the definition of “Borrowing Base Sub-Cap”.

16. Amendment to Article VII of the Credit Agreement . Article VII is hereby amended by adding the following new Sections 7.16 and 7.17 in the appropriate numerical order:

“7.16 Swap Contracts . The Borrower shall promptly notify the Administrative Agent of the “early termination,” or its equivalent, of any Swap Contract and the Administrative Agent shall promptly notify the Banks of the same.

7.17 Physical Trade Contracts . The Borrower shall promptly notify the Administrative Agent of the “early termination,” or its equivalent, of any Physical Trade Contract and the Administrative Agent shall promptly notify the Banks of the same.”

17. Amendment to Section 8.01 of the Credit Agreement . Section 8.01 is hereby amended by deleting the “and” at the end of clause (j); by deleting “.” at the end of clause (k) and inserting “;” in lieu thereof; by deleting “.” at the end of clause (l) and inserting “; and” in lieu thereof; and by adding the following new clause (m) at the end of Section 8.01:

“(m) Cross-Affiliate Netting Liens.”

 

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18. Amendment to Section 8.06 of the Credit Agreement . Section 8.06(b) of the Credit Agreement is hereby amended by deleting such subsection in its entirety and inserting in lieu thereof the following new language:

“(b) swap contracts (including for the avoidance of doubt, any Swap Contract) entered into in the ordinary course of business as bona fide hedging transactions and physical trade contracts (including for the avoidance of doubt, any Physical Trade Contract) entered into in the ordinary course of business; and”

19. Amendment to Section 8.16 of the Credit Agreement . Section 8.16 is hereby amended by deleting the existing section in its entirety and inserting in lieu thereof the following new language:

“8.16 SPT-Related Standby Letters of Credit . The Borrower shall not permit outstanding SPT-Related Standby Letters of Credit (excluding all Physical Trade Delivery-Related Standby Letters of Credit) plus the aggregate SPT Bank Close-Out Amounts of all SPT Banks plus the aggregate outstanding Unilateral Overage Advances of all Banks to exceed $50,000,000.”

20. Amendment to Article IX of the Credit Agreement . Article IX is hereby amended by adding the following new Section 9.04 in the appropriate numerical order:

“9.04 Application of Payments . Except as expressly provided in this Agreement, from and after the date of the occurrence of any Sharing Event, all amounts thereafter received or recovered under this Agreement or any other Loan Document whether as a result of a payment by the Borrower, the exercise of remedies by the Administrative Agent under any of the Loan Documents, liquidation of collateral or otherwise, shall be applied according to Section 2.01 of the Intercreditor Agreement.”

21. Amendment to Section 11.01 of the Credit Agreement . Section 11.01 is hereby amended by inserting the immediately after the language “(iii) amend, modify or waive any provision of Section 10 without the written consent of the Agents” and immediately before the phrase “ provided , further ” the following language:

“, or (iv) amend, modify or waive any provision contained in Sections   7.16 , 7.17 , 8.16 , 9.04 or 11.21 or any other Section of this Agreement which amendment, modification or waiver would affect the rights and duties of the Swap Banks or Physical Trade Banks hereunder, unless in writing and signed by the Administrative Agent and each Bank that is a Swap Bank or Physical Trade Bank at the time of such amendment, waiver or consent,”

22. Amendment to Section 11.21 of the Credit Agreement . Section 11.21 is hereby amended by deleting the existing section in its entirety and inserting in lieu thereof the following new language:

“11.21 Joinder . From and after the Closing Date, each financial institution, acceptable to the Agents and the Borrower, that executes and delivers an Uncommitted

 

-18-

Line Portion Addendum, substantially in the form of Schedule 11.21 (an “ Uncommitted Line Portion Addendum ”), shall become a party to the Credit Agreement and the Intercreditor Agreement and have the rights and obligations of a Bank hereunder and under the other Loan Documents and shall be bound by the other provisions hereof and thereof.”

23. Amendment to the Recitals to the Credit Agreement . The second recital of the Credit Agreement is hereby amended by inserting “and physical trade” immediately after the phrase “to secure swap” and immediately before the word “counterparties” and also immediately after the phrase “for out-of-the-money swap” and immediately before the word “obligations”.

24. Amendment to Schedule 2.01 of the Credit Agreement . Schedule 2.01 is hereby amended by inserting the language “AND PHYSICAL TRADE CONTRACTS” immediately after the language “(EXCLUDING SWAP CONTRACTS” and immediately before the punctuation “)”.

25. Amendment to Exhibit A to the Credit Agreement . Exhibit A to the Credit Agreement is hereby amended by deleting the Form of Notice of Borrowing in its entirety and substituting the new Exhibit A, substantially in the form of Exhibit E hereof.

26. Amendment to Exhibit E to the Credit Agreement . Exhibit E is hereby amended by deleting the Borrowing Base Collateral Position Report in its entirety and substituting the new Exhibit E, substantially in the form of Exhibit C hereof.

27. Amendment to Exhibit G to the Credit Agreement . Exhibit G is hereby amended by deleting the reference to “Banks (hereinafter defined)” as it appears in the preamble thereto, and inserting in lieu thereof the following “Secured Parties (as defined in the Credit Agreement (hereinafter defined))”.

28. Addition of Exhibit J to Credit Agreement . The Credit Agreement is hereby amended by adding new Exhibit J as the SPT Activity Report substantially in the form of Exhibit D hereof.

29. Representations . To induce the Administrative Agent and the Banks to enter into this Amendment, the Borrower ratifies and confirms each representation and warranty set forth in the Credit Agreement as if such representations and warranties were made on even date herewith, and further represents and warrants that (a) no material adverse change has occurred in the financial condition or business prospects of the Borrower since the date of the last financial statements delivered to the Administrative Agent and the Banks, (b) no Default or Event of Default has occurred and is continuing, and (c) the Borrower is fully authorized to enter into this Amendment. THE BORROWER ACKNOWLEDGES THAT THE CREDIT AGREEMENT PROVIDES FOR A CREDIT FACILITY THAT IS COMPLETELY OPTIONAL ON THE PART OF THE BANKS AND THAT THE BANKS HAVE ABSOLUTELY NO DUTY OR OBLIGATION TO ADVANCE ANY REVOLVING LOAN OR TO ISSUE ANY LETTER OF CREDIT. BORROWER REPRESENTS AND WARRANTS TO THE BANKS THAT BORROWER IS AWARE OF THE RISKS ASSOCIATED WITH CONDUCTING BUSINESS UTILIZING AN UNCOMMITTED FACILITY.

 

-19-

30. Tier I Account Parties. The Required Banks hereby agree that the Physical Trade Banks shall be deemed to be Tier I Account Parties for purposes of this Credit Agreement.

31. Conditions Precedent . This Amendment shall become effective on the first date (the “ Fourth Amendment Effective Date ”) on which each of the following conditions precedent shall have been satisfied:

(a) Fees and Expenses . The Agents and the Banks shall have received payment of all fees and expenses owed to them by the Borrower as of the Fourth Amendment Effective Date;

(b) Delivered Documents . On the Fourth Amendment Effective Date, the Administrative Agent shall have received executed originals of:

(i) this Amendment, executed by a duly authorized officer of each of the Borrower and the Banks;

(ii) the Acknowledgement and Consent set forth in Exhibit B hereto, each executed by a duly authorized officer of the party named therein, consenting to this Amendment and affirming the Loan Documents specified therein;

(iii) a legal opinion of counsel to the Borrower and counsel to Guarantor each addressed to the Administrative Agent and the Banks, in form and substance acceptable to the Administrative Agent and the Banks;

(iv) copies of the resolutions of the members of the Borrower authorizing the amendments and transactions contemplated hereby, certified as of the Fourth Amendment Effective Date by the Secretary of the Borrower, and certifying the names and true signatures of the officers of the Borrower authorized to execute, deliver and perform, as applicable, this Amendment and all other documents to be delivered by the Borrower hereunder; and

(v) such other documents or certificates as the Administrative Agent or counsel to the Administrative Agent may reasonably request.

 

-20-

32. Miscellaneous .

(a) Limited Effect . Except as expressly consented to hereby, the Credit Agreement and the other Loan Documents shall remain in full force and effect in accordance with their respective terms, without any consent, amendment, waiver or modification of any provision thereof; provided , however , that upon the Fourth Amendment Effective Date, all references herein and therein to the “Loan Documents” shall be deemed to include, in any event, the Amendment to the Guaranty, dated as of October 1, 2003, the First Amendment to Subordination Agreement, dated as of February 18, 2004, Amendment No. 1 to the Security Agreement and Reaffirmation dated March 30, 2005, the First Amendment, the Second Amendment, the Third Amendment, and this Amendment, and all other documents delivered to the Administrative Agent or any Bank in connection therewith. Each reference to the Credit Agreement in any of the Loan Documents shall be deemed to be a reference to the Credit Agreement as amended hereby.

(b) Severability . In case any of the provisions of this Amendment shall for any reason be held to be invalid, illegal, or unenforceable, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and this Amendment shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein.

(c) Execution in Counterparts . This Amendment 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 Amendment by signing one or more counterparts. Delivery of an executed counterpart of a signature page to this Amendment by facsimile or telecopier shall be effective as delivery of an originally executed counterpart of this Amendment.

(D) GOVERNING LAW . THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; PROVIDED , HOWEVER , THAT THE ADMINISTRATIVE AGENT, THE BANKS AND ALL AGENT-RELATED PERSONS SHALL RETAIN ALL RIGHTS UNDER FEDERAL LAW.

(e) Rights of Third Parties . All provisions herein are imposed solely and exclusively for the benefit of the Borrower, Administrative Agent, the Banks, Agent-Related Persons, and their permitted successors and assigns, and no other Person shall be a direct or indirect legal beneficiary of, or have any direct or indirect cause of action or claim in connection with this Amendment or any of the other Loan Documents.

(f) COMPLETE AGREEMENT . THIS WRITTEN AMENDMENT AND THE OTHER WRITTEN AGREEMENTS ENTERED INTO AMONG THE PARTIES REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

[SIGNATURES FOLLOW]

 

-21-

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

 

BORROWER

ATMOS ENERGY MARKETING ,  LLC , a Delaware

    limited liability company

By:  

/s/ C. RICHARD ALFORD

Name:   C. Richard Alford
Title:   Senior Vice President
GUARANTOR
ATMOS ENERGY HOLDINGS, INC.
By:  

/s/ LAURIE M. SHERWOOD

Name:   Laurie M. Sherwood
Title:   Senior Vice President and Treasurer

[Signature Page to Fourth Amendment]

FORTIS CAPITAL CORP. , a Connecticut

    corporation, as Joint Lead Arranger and Joint

    Bookrunner, Administrative Agent, Collateral Agent,

    Issuing Bank, and a Bank

By:  

/s/ IRENE C. RUMMEL

Name:   Irene C. Rummel
Title:   Director
By:  

/s/ CHAD CLARK

Name:   Chad Clark
Title:   Director

 

[Signature Page to Fourth Amendment]

BNP PARIBAS, a bank organized under the

    laws of France, as Joint Lead Arranger and

    Joint Bookrunner, Documentation Agent,

    Issuing Bank and a Bank

By:  

/s/ EDWARD K. CHIN

Name:   Edward K. Chin
Title:   Managing Director
By:  

/s/ ANDREW STRATOS

Name:   Andrew Stratos
Title:   Vice President

 

[Signature Page to Fourth Amendment]

SOCIÉTÉ GÉNÉRALE, as Syndication Agent

    and as a Bank

By:  

/s/ BARBARA PAULSEN

Name:   Barbara Paulsen
Title:   Managing Director
By:  

/s/ EMMANUEL CHESNEAU

Name:   Emmanuel Chesneau
Title:   Managing Director

 

[Signature Page to Fourth Amendment]

NATIXIS, acting through its New York Branch,

    as a Bank

By:  

/s/ DAVID PERSHAD

Name:   David Pershad
Title:   Managing Director
By:  

/s/ JULIEN MATHIEU

Name:   Julien Mathieu
Title:   Associate Director

 

[Signature Page to Fourth Amendment]

RZB FINANCE LLC, as a Bank
By:  

/s/ HERMINE KIROLOS

Name:   Hermine Kirolos
Title:   Group Vice President
By:  

/s/ ASTRID WILKE

Name:   Astrid Wilke
Title:   Vice President

 

[Signature Page to Fourth Amendment]

THE BANK OF TOKYO-MITSUBISHI UFJ,  LTD.,

    as a Bank

By:  

/s/ LINDA TERRY

Name:   Linda Terry
Title:   Vice President & Manager

 

[Signature Page to Fourth Amendment]

BROWN BROTHERS HARRIMAN & CO.,

    as a Bank

By:  

/s/ MICHAEL H. VELLUCCI

Name:   Michael H. Vellucci
Title:   Senior Vice President

 

[Signature Page to Fourth Amendment]

THE ROYAL BANK OF SCOTLAND plc,

    as a Bank

By:  

/s/ MATTHEW MAIN

Name:   Matthew Main
Title:   Managing Director
By:  

 

Name:  
Title:  

 

[Signature Page to Fourth Amendment]

EXHIBIT A TO

FOURTH AMENDMENT

SCHEDULE 11.02

ADDRESSES FOR NOTICES AND LENDING OFFICES

ATMOS ENERGY MARKETING, LLC

Borrower’s Address:

13430 Northwest Freeway, Suite 700

Houston, Texas 77040

Attention: Ronald W. Bahr

Telephone: (713) 688-7771

Facsimile: (713) 688-5124

FORTIS CAPITAL CORP.,

As Administrative Agent and Collateral Agent

15455 N. Dallas Parkway

Suite 1400

Addison, TX 75001

Telephone: (214) 953-9313

Facsimile: (214) 969-9332

FORTIS CAPITAL CORP.,

As Issuing Bank and a Bank

15455 N. Dallas Parkway

Suite 1400

Addison, TX 75001

Attention: Marla Jennings

Telephone: (214) 953-9313

Facsimile: (214) 969-9332

BNP PARIBAS

As Documentation Agent, Issuing Bank and a Bank

787 Seventh Avenue

New York, New York 10019

Attention: Ed Chin

Telephone: (212) 841-2020

Facsimile: (212) 841-2536

SOCIÉTÉ GÉNÉRALE ,

As Syndication Agent and as a Bank

1221 Avenue of the Americas

New York, New York 10020

Attention: Barbara Paulsen

Telephone: (212) 278-6496

Facsimile: (212) 278-7417

NATIXIS , acting through its New York Branch,

As a Bank

1251 Avenue of the Americas, 34 th Floor

New York, New York 10020

Attention: David Pershad

Telephone: (212) 872-5015

Facsimile: (212) 354-9095

RZB FINANCE LLC

As a Bank

1133 Avenue of the Americas

New York, New York 10036

Attention: Hermine Kirolos

Telephone: (212) 845-4114

Facsimile: (212) 944-6389

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.

As a Bank

The Bank of Tokyo-Mitsubishi UFJ, Ltd.,

New York Branch

1251 Avenue of the Americas,

New York, New York 10020-1104

Attention: USCB Portfolio Management Group

Facsimile: (212) 782-4979

with a copy to :

The Bank of Tokyo-Mitsubishi UFJ, Ltd.,

Houston Agency

1100 Louisiana Street,

Suite 2800

Houston, Texas 77002

Attention: Damain Sullivan

Telephone: (713) 655-3808

Facsimile: (713) 658-0116

BROWN BROTHERS HARRIMAN & Co.

As a Bank

140 Broadway

New York, New York 10005

Attention: Paul Feldman

Telephone: (212) 493-7732

Facsimile: (212) 493-8998

THE ROYAL BANK OF SCOTLAND plc

As a Bank

101 Park Avenue, 6 th Floor

New York, New York 10178

Attention: Alisa Williams

Telephone: (212) 401-3200

With copies to:

600 Travis St, Suite 6500

Houston, Texas 77002

Attention: Matthew Main

Telephone: (713) 221-2441

Facsimile: (713) 221-2430

EXHIBIT B TO

FOURTH AMENDMENT

ACKNOWLEDGEMENT AND CONSENT

Reference is made to (i) the FOURTH AMENDMENT, dated as of March 31, 2008 (the “ Fourth Amendment ”), to the SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of March 30, 2005 (as amended by the First Amendment, dated November 28, 2005, the “ First Amendment ”, the Second Amendment, dated as of March 31, 2006, the “ Second Amendment ”, the Third Amendment, dated as of March 30, 2007, and as further amended, supplemented or otherwise modified from time to time, the “ Credit Agreement ”), among ATMOS ENERGY MARKETING, LLC, a Delaware limited liability company (the “ AEM ”), FORTIS CAPITAL CORP., a Connecticut corporation (“ Fortis ”), as a Bank, as an Issuing Bank, and as Administrative Agent for the Banks (in such capacity, the “ Administrative Agent ”), as Collateral Agent, as a Joint Lead Arranger and as a Joint Bookrunner, BNP PARIBAS, a bank organized under the laws of France (“ BNP Paribas ”), as a Bank, as an Issuing Bank, as a Joint Lead Arranger, as a Joint Bookrunner and as Documentation Agent, SOCIÉTÉ GÉNÉRALE, as Syndication Agent and as a Bank (together with the Administrative Agent, the “ Agents ”), and each other financial institution that may become a party thereto (collectively the “ Banks ”), (ii) that certain INTERCREDITOR AGREEMENT, dated as of March 31, 2008, (the “ Intercreditor Agreement ”) by and among the Banks, Swap Banks, Physical Trade Banks, the Agent (as defined therein) and the Borrower, (iii) that certain SECURITY AGREEMENT, dated as of December 1, 2001 (as amended by AMENDMENT NO. 1 to the SECURITY AGREEMENT, dated as of March 30, 2005 and as further amended, restated, supplemented or otherwise modified in writing from time to time, the “ Security Agreement ”) executed by AEM as grantor (the “ Grantor ”) and the Collateral Agent, (iv) that certain GUARANTY, dated March 30, 2005 (as further amended, restated, supplemented or otherwise modified in writing from time to time, the “ AEH Guaranty ”) executed for the ratable benefit of the Banks by Atmos Energy Holdings, Inc. (“ AEH ”) as guarantor (the “ Guarantor ”), (v) that certain ATMOS SUPPORT AGREEMENT, dated March 30, 2005 (as further amended, restated, supplemented or otherwise modified in writing from time to time, the “ Atmos Support Agreement ”) executed by Atmos Energy Corporation, a Texas and Virginia corporation (“ Atmos ”) as support sponsor (the “ Support Provider ”), and (vi) that certain SUBORDINATION AGREEMENT dated as of March 30, 2005 (as further amended, restated, supplemented or otherwise modified in writing from time to time, the “ Subordination Agreement ”) by and between Fortis and AEH (the “ Subordinated Creditor ,” together with the Security Agreement, the AEH Guaranty and the Atmos Support Agreement, collectively, the “ Security Documents ” and individually, a “ Security Document ”) and acknowledged by the Borrower. Unless otherwise defined herein, capitalized terms used herein and defined in the Credit Agreement are used herein as therein defined.

Each of the Grantor, the Guarantor, the Support Provider and the Subordinated Creditor hereby:

(a) acknowledges that the Borrower has requested certain other amendments to the Credit Agreement on the terms and subject to the conditions set forth in the Fourth Amendment;

(c) acknowledges that such requests were in order and that the benefits of such extensions and other amendments pursuant to the Fourth Amendment will directly or indirectly accrue to such party;

(d) consents to the Fourth Amendment;

(e) confirms and agrees that its respective obligations under the applicable Security Documents shall continue in full force and effect and is hereby ratified and confirmed in all respects;

(f) acknowledges the receipt and sufficiency of such benefits and other good and valuable consideration to support its continuing obligations under the applicable Security Documents, including as such obligations may be affected by the effectiveness of the Fourth Amendment;

(g) acknowledges the Intercreditor Agreement.

Each party hereto, in its capacity as grantor, guarantor, support provider and subordinated creditor, hereby ratifies that certain Fourth Amendment to Credit Agreement.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties hereto have caused this Acknowledgement and Consent to be duly executed and delivered by their respective proper and duly authorized officers as of March 31 st , 2008.

 

ATMOS ENERGY MARKETING, LLC
  as Grantor
By:  

 

Name:   C. Richard Alford
Title:   Senior Vice President
ATMOS ENERGY HOLDINGS, INC.,
  as Guarantor and as Subordinated Creditor
By:  

 

Name:   Laurie M. Sherwood
Title:   Senior Vice President and Treasurer
ATMOS ENERGY CORPORATION,
  as Support Provider
By:  

 

Name:   Laurie M. Sherwood
Title:   Vice President, Corporate Development and Treasurer
By:  

 

Name:  
Title:  

[Signature Page to Acknowledgement and Consent to Fourth Amendment]

EXHIBIT C

TO FOURTH AMENDMENT

EXHIBIT E

ATMOS ENERGY MARKETING, LLC, BORROWING BASE

COLLATERAL POSITION REPORT AS OF [DATE]

In my capacity as Responsible Officer for ATMOS ENERGY MARKETING, LLC, I hereby certify that as of the date written above, the amounts indicated below were accurate and true as of the date of preparation. I also certify that the net long or short position has not exceeded the limitations set forth in Section 8.11 of the Credit Agreement.

 

I.    COLLATERAL          
   A.    Cash Collateral                   100 %      $                 
   B.    Equity in Eligible Broker accounts                   90 %      $                 
   C.    Tier I Accounts                   90 %      $                 
   D.    Tier II Accounts                   85 %      $                 
   E.    Tier I Unbilled Accounts                   85 %      $                 
   F.    Tier II Unbilled Accounts                   80 %      $                 
   G.    Eligible Inventory                   80 %      $                 
   H.    Eligible Exchange Receivables                   80 %      $                 
   I.    Undelivered Product Value                   80 %      $                 
   J.    Realizable Unrealized Profits, up to a maximum amount of $50,000,000; less                   70 %      $                 
   K.    First purchaser liability; less    $ (              )   100 %      $ (              )
   L.    SPT Close-Out Amounts; less    $ (              )   125 %      $ (              )
   M.    Unrealized Mark-to-Market Losses    $ (              )   100 %      $ (              )
   TOTAL COLLATERAL    $                    
                         
   BORROWING BASE SUB-CAP           $               
                   
   BORROWING BASE ADVANCE CAP           $               
                             
II.    BANK OUTSTANDINGS           $               
   A.    Loans from the Banks           $               
   B.    L/C’s from the Banks           $               
   C.    Unilateral Overage Advances from the Banks                           
                                
TOTAL OUTSTANDINGS UNDER BORROWING BASE LINE                           
III.    EXCESS/(DEFICIT) (I-II)                           
IV.    NET SHORT OR LONG POSITION                      MMBTUS           $               

Attached hereto are (i) an aging report, (ii) a schedule of netted qualified exchange balances, (iii) a schedule of qualified inventory and (iv) a schedule of all contras applied against (i), (ii), and (iii).

By:  

 

  Responsible Officer

EXHIBIT D

TO FOURTH AMENDMENT

EXHIBIT J

SPT ACTIVITY REPORT AS OF [DATE]

In my capacity as Responsible Officer for ATMOS ENERGY MARKETING, LLC, I hereby certify that as of the date written above, the

amounts indicated below were accurate and true as of the date of preparation. I also certify that SPT Contract related activity  has not exceeded the

limitations set forth in Section 8.16 of the Credit Agreement.

 

SPT Bank

   Maximum Swap
Bank Close-Out
Amount
   Maximum Physical
Trade Bank Close-Out
Amount
   Maximum SPT
Bank Close-Out
Amount
   Current Swap
Bank Close-Out
Amount
   Current Physical
Trade Bank Close-Out
Amount
   Current Aggregate
SPT Bank Close-Out
Amount
   Available SPT
Close-Out
Amount

BNP Paribas

   $ 25,000,000    $ 25,000,000    $ 25,000,000    $ 20,000,000       $ 20,000,000    $ 5,000,000

Fortis Capital Corp.

   $ 25,000,000    $ 25,000,000    $ 25,000,000       $ 20,000,000    $ 20,000,000    $ 5,000,000

Société Générale

   $ 25,000,000    $ 25,000,000    $ 25,000,000            

The Royal Bank of Scotland plc

   $ 25,000,000    $ 25,000,000    $ 25,000,000            

NATIXIS, acting through its New York Branch

   $ 25,000,000    $ 25,000,000    $ 25,000,000            

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

     N/A      N/A      N/A            

RZB Finance LLC

     N/A      N/A      N/A            

Brown Brothers Harriman & Co.

     N/A      N/A      N/A            

Totals

     N/A      N/A      N/A      N/A      N/A    $ 40,000,000      N/A

CALCULATION OF SPT ACTIVITY UTILIZATION RATIO

 

Total Current
Aggregate SPT
Bank Close-Out
Amount

(“Total CO Amount”)  1

   Amount of Outstanding
SPT-Related Standby Letters of

Credit (excluding all Physical
Trade Delivery-Related
Standby Letters of Credit)
(“Total SPT L/C Amount”)
    Total Outstanding
Unilateral Overage
Advances
(“Total UOA”)
    Covenant Cap
(“Covenant Cap”) 2
  

“SPT Activity Utilization Ratio”

=

((Total CO Amount) + (Total SPT L/C Amount) + (Total UOA))

/(Covenant Cap)

[expressed as a percentage, rounded to the second decimal place]

$40,000,000    [              ]   [              ]   $ 50,000,000   

 

By:  

 

  Responsible Officer

 

1 Determined by reference to the U.S. Dollar amount listed in the last row under the heading “Current Aggregate SPT Bank Close-Out Amount”.
2 Determined by reference to the limit set in Section 8.16 of the Credit Agreement, which as of the Fourth Amendment is $50,000,000.

EXHIBIT E

TO FOURTH AMENDMENT

EXHIBIT A

FORM OF NOTICE OF BORROWING

(LETTERS OF CREDIT)

[Date]

 

Fortis Capital Corp.    BNP Paribas
15455 North Dallas Parkway    787 Seventh Avenue
Suite 1400    New York, New York 10019
Addison, TX 75001    Attention: Edward Chin
Attention: Marla Jennings    Telephone: (212) 841-2020
Telephone: (214) 953-9314    Facsimile: (212) 841-2536
Facsimile: (214) 969-9332   

 

  Re: Uncommitted Second Amended and Restated Credit Agreement, dated to be effective as of March 30, 2005 (as amended or supplemented from time to time, the “Agreement”), by and among ATMOS ENERGY MARKETING, LLC (the “Borrower”), the banks that from time to time are parties thereto, Fortis Capital Corp., as Administrative Agent, and BNP Paribas, as Documentation Agent

Ladies and Gentlemen:

Reference is made to the Agreement (capitalized terms used herein that are not defined shall have the respective meanings ascribed thereto in the Agreement). The Borrower hereby gives notice (i) of its intention to request the [issuance, amendment, or renewal] of Letters of Credit as is further described on the Letter of Credit Application attached hereto and (ii) that the requested Letter of Credit will be a(n) [commercial documentary letter of credit, a SPT-Related Standby Letter of Credit, Physical Trade Delivery-Related Standby Letter of Credit, or other standby letter of credit 3 ].

The Borrower represents and warrants, as of the date hereof and as of the date any Letter of Credit is Issued, amended or renewed, that (i) no Default or Event of Default has occurred and is continuing on the date hereof, nor will any thereof occur after giving effect to the Letters of Credit requested above; (ii) that the Borrowing Base Advance Cap will not be exceeded after giving effect to the Letters of Credit requested above; and (iii) all of Borrower’s representations and warranties under the Agreement are true and correct, to Borrower’s knowledge, as of the date hereof.

 

3 With respect to any Letter of Credit that is characterized as an “other standby letter of credit” a purpose should be specified for such “other standby letter of credit” so that clause (ii) might read “(ii) that the requested Letter of Credit will be an other standby letter of credit for the purpose of purchasing natural gas from a source other than an Physical Trade Bank.”

Very truly yours,
ATMOS ENERGY MARKETING, LLC,
By:  

 

Name:  

 

Title:  

 

FORM OF NOTICE OF BORROWING

(REVOLVING LOAN)

[Date]

Fortis Capital Corp.

15455 North Dallas Parkway

Suite 1400

Addison, TX 75001

Attention: Marla Jennings

Telephone: (214) 953-9314

Facsimile: (214) 969-9332

 

  Re: Uncommitted Second Amended and Restated Credit Agreement, dated to be effective as of March 30, 2005 (as amended or supplemented from time to time, the “Agreement”), by and among ATMOS ENERGY MARKETING, LLC (the “Borrower”), the banks that from time to time are parties thereto, Fortis Capital Corp., as Administrative Agent, and BNP Paribas, as Documentation Agent

Ladies and Gentlemen:

Reference is made to the Agreement (capitalized terms used herein that are not defined shall have the respective meanings ascribed thereto in the Agreement). The Borrower hereby gives notice of its intention to borrow under the Borrowing Base Line. Please advance a Revolving Loan as follows:

 

Date of Borrowing a-1    :   

 

   
Amount    :   

 

   
Type of Advance          
(Base Rate or Offshore Rate)    :   

 

   
Interest Period          
(if Offshore Rate)    :   

 

  .  

The Borrower represents and warrants, as of the date hereof and as of the date any Revolving Loan is made or renewed, that (i) no Default or Event of Default has occurred and is continuing on the date hereof, nor will any thereof occur after giving effect to the Revolving Loan requested above; (ii) that neither the Borrowing Base Advance Cap nor the Dollar Advance Cap will be exceeded after giving effect to the Revolving Loan requested above; and (iii) all of Borrower’s representations and warranties under the Agreement are true and correct, to Borrower’s knowledge, as of the date hereof.

 

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The aggregate amount of the Borrowing comprised of Offshore Rate Loans must be made in an amount equal to the Offshore Effective Amount. The date of the Borrowing must be a Business Day. Borrower must give four (4) Business Days advance notice for Borrowings comprised of Offshore Rate Loans, and the same Business Day advance notice for Borrowings comprised of Base Rate Loans.

Very truly yours,
ATMOS ENERGY MARKETING, LLC,
By:  

 

Name:  

 

Title:  

 

Exhibit 10.2

EXECUTION VERSION

INTERCREDITOR AGREEMENT

THIS INTERCREDITOR AGREEMENT is dated as of March 31, 2008 (as amended, supplemented and otherwise modified from time to time, the “ Agreement ”), among FORTIS CAPITAL CORP., a Connecticut corporation, in its capacity as Collateral Agent (together with its successors and assigns in such capacity, the “ Agent ”) for the Banks hereinafter referred to, and each bank and other financial institution which is now or hereafter a party to this Agreement in its capacity as a Bank and, as applicable, as a Swap Bank (collectively, the “ Swap Banks ”) and as a Physical Trade Bank (collectively, the “ Physical Trade Banks ”);

WHEREAS, Atmos Energy Marketing, LLC (the “ Borrower ”), certain banks and financial institutions (the “ Banks ”), and the Agent are parties to the Uncommitted Second Amended and Restated Credit Agreement dated as of March 30, 2005 (as amended, modified, supplemented or restated from time to time, the “ Credit Agreement ”);

WHEREAS, the Swap Banks may be parties to Swap Contracts with the Borrower;

WHEREAS, the Physical Trade Banks may be parties to Physical Trade Contracts with the Borrower; and

WHEREAS, the Agent and the Banks, the Swap Banks and the Physical Trade Banks desire to enter into this Agreement to provide for the rights of the Agent, the Banks, the Swap Banks and the Physical Trade Banks with respect to Collateral and other matters;

NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, the parties agree as follows:

ARTICLE I

DEFINITIONS

1.01 Certain Defined Terms .

(a) Capitalized terms used herein and not defined herein shall have the meanings ascribed thereto in the Credit Agreement.

(b) The following terms have the following meanings:

Adjusted Pro Rata Share ” means, as to any Bank, SPT Bank or, in the case of a SPT Bank that together with any other SPT Bank comprises a Cross-Affiliate Pair, such Cross-Affiliate Pair, in each case, as of the opening of business on the date of the occurrence of a Sharing Event hereunder, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of (a) the sum of such Bank’s, SPT Bank’s or Cross-Affiliate Pair’s (as the case may be): (i) Effective Amount relating to Obligations arising under the Borrowing Base Line, (ii) Permitted Unilateral Overage Advance Amount, plus (iii) Permitted SPT Bank Close-Out Amounts, divided by (b) the sum of (x) Effective Amounts of all the Banks relating to Obligations arising under the Borrowing Base Line, (y) Permitted Unilateral Overage Advance Amounts of all Banks, plus (y) the Permitted SPT Bank Close-Out Amounts of all Banks, SPT Banks, and Cross-Affiliate Pairs. For the avoidance of doubt, “Adjusted Pro Rata Share” shall be calculated for a SPT Bank or a Cross-Affiliate Pair on a stand alone basis only to the extent that such SPT Bank or both SPT Banks comprising such Cross-Affiliate Pair are not also Banks.

Excess SPT Bank Close-Out Amounts ” means, with respect to any SPT Bank, or in the case of a SPT Bank that together with any other SPT Bank comprises a Cross-Affiliate Pair, such Cross-Affiliate Pair, as of any date of determination, the positive difference (if any) of: (a) the SPT Bank Close-Out Amount of such SPT Bank (or Cross-Affiliate Pair, as the case may be) minus (b) the Permitted SPT Bank Close-Out Amount for such SPT Bank (or Cross-Affiliate Pair, as the case may be).

Excess Unilateral Overage Advance Amounts ” means, with respect to any Bank, as of any date of determination, the positive difference (if any) of: (a) the outstanding Unilateral Overage Advances of such Bank as of such date minus (b) the Permitted Unilateral Overage Advance Amounts for such Bank.

Final Date ” shall have the meaning set forth in Section 2.01(f) hereof.

ISDA Master Agreement ” means the standard form of ISDA Master Agreement as in effect on the date hereof and as amended, modified, supplemented or replaced from time to time.

Payment ” means, as to any Bank, Swap Bank or Physical Trade Bank at any time, any payment (whether voluntary, involuntary, through exercise of any right of set-off, through liquidation or collection of any Collateral or otherwise). The term “Payment” shall not include any payment to a Swap Bank or Physical Trade Bank from the proceeds of a Loan made by the Banks or the Administrative Agent for the purpose of paying Obligations under clauses (b) and (c) of such term or providing cash collateral in connection with an increase in a Swap Bank Close-Out Amount or Physical Trade Bank Close-Out Amount pursuant to Section 2.01(c) or any payment to a Swap Bank or Physical Trade Bank from the proceeds of collateral held solely by such Swap Bank or Physical Trade Bank or drawings under letters of credit naming such Swap Bank or Physical Trade Bank as beneficiary or any payment due from a Swap Bank pursuant to a swap settlement that is held by such Swap Bank as cash collateral to cover obligations owing under a Swap Contract to the Swap Bank from the Borrower or any payment due from a Physical Trade Bank pursuant to a physical trade settlement that is held by such Physical Trade Bank as cash collateral to cover obligations owing under a Physical Trade Contract to the Physical Trade Bank from the Borrower; provided that, the Swap Bank Close-Out Amount or Physical Trade Bank Close-Out Amount had netted the Swap Contract or Physical Trade Contract under which such payments held as cash collateral were made; provided further that, in the case of such collateral, such Swap Bank or Physical Trade Bank holds a perfected Lien in such collateral and such collateral is not subject to the Agent’s prior or equal perfected Lien under any Loan Document.

Permitted SPT Bank Close-Out Amounts ” means, with respect to any SPT Bank, or in the case of a SPT Bank that together with any other SPT Bank comprises a Cross-Affiliate Pair, such Cross-Affiliate Pair, as of any date of determination, an amount equal to the lesser of (a) the sum (which shall not be less than zero) of (i) the Swap Bank Close-Out Amounts, plus (ii) the Physical Trade Bank Close-Out Amounts, and (b) the Maximum SPT Bank Close-Out Amount set opposite such SPT Bank in the table below; provided , however , that with respect to any SPT Bank, the Swap Bank Close-Out Amount and the Physical Trade Bank Close-Out Amount of such SPT Bank (or such Cross-Affiliate Pair, as the case may be) that may be included in the calculation of the amount determined under clause (a) above shall be limited to the applicable amount set forth opposite such SPT Bank under the heading “ Maximum Swap Bank Close-Out Amount ” and “ Maximum Physical Trade Bank Close-Out Amount ;” provided further that with respect to any SPT Bank that together with any other SPT Bank comprises a Cross-Affiliate Pair, the “Permitted SPT Bank Close-Out Amount” shall be determined on a consolidated basis as though the two SPT Banks comprising such Cross-Affiliate Pair are one SPT Bank, as follows, the calculation of the amount to be determined under clause (a) above shall be the sum (which shall not be less than zero) of the aggregate Swap Bank Close-Out Amounts and the aggregate Physical Trade Bank Close-Out Amounts for both SPT Banks comprising such Cross-Affiliate Pair (as may be limited, in the case of each SPT Bank, by the “Maximum Swap Bank Close-Out Amount” and “Maximum Physical Trade Bank Close-Out Amount ,” as applicable, as set forth in the initial proviso above):

 

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SPT Bank (and its SPT Bank Affiliates, in the aggregate)

   Maximum
Swap Bank
Close-Out
Amount
   Maximum
Physical Trade
Bank
Close-Out Amount
   Maximum SPT
Bank Close-Out
Amount

BNP Paribas

   25,000,000    25,000,000    25,000,000

Fortis Capital Corp.

   25,000,000    25,000,000    25,000,000

Société Générale

   25,000,000    25,000,000    25,000,000

The Royal Bank of Scotland

   25,000,000    25,000,000    25,000,000

NATIXIS, acting through its New York Branch

   25,000,000    N/A    25,000,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

   N/A    N/A    N/A

RZB Finance LLC

   N/A    N/A    N/A

Brown Brothers Harriman & Co.

   N/A    N/A    N/A

Permitted Unilateral Overage Advance Amount ” means, with respect to any Bank, as of any date of determination, an amount equal to the lesser of (a) the outstanding Unilateral Overage Advance of such Bank as of such date, and (b) the positive difference (if any) of (i) the Maximum SPT Bank Close-Out Amount for such Bank (to the extent that such Bank is a SPT Bank) or its affiliated SPT Bank (or Cross-Affiliate Pair, as the case may be, which, in the case of a Cross-Affiliate Pair, shall be determined in accordance with the last proviso of the above definition of “Permitted SPT Bank Close-Out Amount”) minus (ii) the Permitted SPT Bank Close-Out Amount for such Bank (to the extent that such Bank is a SPT Bank) or its affiliated SPT Bank (or Cross-Affiliate Pair, as the case may be, which, in the case of a Cross-Affiliate Pair shall be determined in accordance with the last proviso of the above definition of “Permitted SPT Bank Close-Out Amount”).

Physical Trade Bank Close-Out Amount ” means, with respect to any Physical Trade Bank as of any date of calculation thereof, the net amount that would be due from the Borrower, if any, upon the designation of an “early termination date” or its equivalent or a “termination event” or its equivalent with respect to all Physical Trade Contracts with a particular Physical Trade Bank under the applicable ISDA Master Agreement (or other applicable Physical Trade Contract documents), net of (a) the face amount of letters of credit naming such Physical Trade Bank as beneficiary supporting payment obligations under Physical Trade Contracts with such Physical Trade Bank and (b) the value of collateral subject to the first priority perfected Lien of the Physical Trade Bank and which is not collateral in which the Agent has a prior or equal perfected Lien under the Security Agreements or any other Loan Document, which, for the avoidance of doubt, shall include the value of all collateral pledged in favor of such Physical Trade Bank pursuant to a Cross-Affiliate Netting Lien (if any). Section 2.01(j) hereof contains certain provisions relating to the calculation of a Physical Trade Bank Close-Out Amount under a Physical Trade Contract.

Physical Trade Obligations ” means obligations referred to in clause (c) of the definition of Obligations in the Credit Agreement.

 

3

SPT Bank Close-Out Amount ” means, with respect to any SPT Bank, the sum (which shall not be less than zero) of its Swap Bank Close-Out Amount and its Physical Trade Bank Close-Out Amount.

Sharing Event ” means the occurrence of any Event of Default under Section 9.01(e) or Section 9.01(f) of the Credit Agreement or any acceleration of the Obligations referred to in clause (a) of the definition of such term under the Credit Agreement after the occurrence of any other Event of Default or the determination by the Required Banks at any time after the occurrence of any Event of Default that a Sharing Event has occurred.

Swap Bank Close-Out Amount ” means, with respect to any Swap Bank, as of any date of calculation thereof, the net amount that would be due from the Borrower, if any, upon the designation of an “early termination date” or its equivalent or a “termination event” or its equivalent with respect to all Swap Contracts with a particular Swap Bank under the applicable ISDA Master Agreement or its equivalent (e.g., long-form confirmations), net of (a) the face amount of letters of credit naming such Swap Bank as beneficiary supporting payment obligations under Swap Contracts with such Swap Bank, and (b) the value of collateral subject to the first priority perfected Lien of the Swap Bank and which is not collateral in which the Agent has a prior or equal perfected Lien under the Security Agreements or any other Loan Document, which, for the avoidance of doubt, shall include the value of all collateral pledged in favor of such Swap Bank pursuant to a Cross-Affiliate Netting Lien (if any). Section 2.01(i) hereof contains certain provisions relating to the calculation of a Swap Bank Close-Out Amount under a Swap Contract.

Swap Obligations ” means obligations referred to in clause (b) of the definition of Obligations in the Credit Agreement.

1.02 Other Interpretive Provisions .

(a) The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms.

(b) The words “hereof,” “herein,” “hereunder” and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement; and Subsection, Section , Schedule and Exhibit references are to this Agreement unless otherwise specified.

(c) The term “documents” includes any and all instruments, documents, agreements, certificates, indentures, notices and other writings, however evidenced.

(d) The term “including” is not limiting and means “including without limitation.”

(e) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including”; the words “to” and “until” each mean “to but excluding,” and the word “through” means “to and including.”

(f) Unless otherwise expressly provided herein, (i) references to agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments and other modifications thereto, but only to the extent such amendments and other modifications are not prohibited by the terms of any Loan Document, and (ii) references to any statute or regulation are to be construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting the statute or regulation.

 

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(g) The captions and headings of this Agreement are for convenience of reference only and shall not affect the interpretation of this Agreement.

(h) This Agreement is the result of negotiations among and has been reviewed by counsel to each of the parties, and is the product of all parties. Accordingly, it shall not be construed against any party merely because of such party’s involvement in its preparation.

ARTICLE II

SHARING

2.01 Sharing after Sharing Event .

(a) Except as expressly provided in this Agreement, from and after the date of the occurrence of any Sharing Event, the provisions of Sections 2.01(b) through (k)  hereof shall apply rather than Section 2.11(a) of the Credit Agreement:

(b) (i) Both (x) the proceeds of all Collateral included in the then most recent Borrowing Base Collateral Position Report and each subsequent Borrowing Base Collateral Position Report (and all other Collateral not included in any such report) and (y) any other Payments received by the Agent, any Bank or any SPT Bank shall be applied to payment of and/or cash collateral for (1)  first , the Obligations (A) arising from the Borrowing Base Line (which, for the avoidance of doubt shall not include any Unilateral Overage Advance obligations), (B) with respect to the Permitted Unilateral Overage Advance Amounts and (C) with respect to the Permitted SPT Bank Close-Out Amounts (other than amounts arising under Swap Obligations or Physical Trade Obligations excluded from the calculation of Swap Bank Close-Out Amounts under Section 2.01(i) and Physical Trade Bank Close-Out Amounts under Section 2.01(j) , respectively), and (2)  second , Obligations with respect to (A) the Excess SPT Bank Close-Out Amounts, (B) the Excess Unilateral Overage Advance Amounts, and (C) Swap Obligations and Physical Trade Obligations excluded from the calculation of Swap Bank Close-Out Amounts under Section 2.01(i) and Physical Trade Bank Close-Out Amounts under Section 2.01(j) , respectively, in each case under clause first above ratably in accordance with each Bank’s, Swap Bank’s and Physical Trade Bank’s Adjusted Pro Rata Share, as applicable, and in each case under clause second above ratably in accordance with the amount of such Obligations; provided that, if any such report is not correct and complete in any material respect (as determined by the Agent is its sole, good faith discretion), the Agent shall use reasonable efforts to correct any error or deficiency prior to making such application. Such proceeds and Payments applied to Obligations arising from the Borrowing Base Line, Swap Obligations and Physical Trade Obligations shall be applied in accordance with Sections 2.01(b) through (j) .

(ii) If any Bank, Swap Bank or Physical Trade Bank shall obtain on account of the Loans made by it under the Borrowing Base Line or any other Obligations owed to it any Payment in excess of its Adjusted Pro Rata Share, such Bank, Swap Bank or Physical Trade Bank shall immediately (A) notify the Agent of such fact, and (B) purchase from the other Banks, Swap Banks and Physical Trade Banks such participations in the Loans made by them under the Borrowing Base Line and other Obligations owed to them as shall be necessary to cause such purchasing Bank, Swap Bank or Physical Trade Bank to share the excess payment pro rata , in accordance with the Adjusted Pro Rata Share, with each of them; provided , however , if all or any portion of such excess payment is thereafter recovered from the purchasing Bank, Swap Bank or Physical Trade Bank, such purchase shall to that extent be rescinded and each other Bank, Swap Bank and Physical Trade Bank shall repay to the purchasing Bank, Swap Bank or Physical Trade Bank the purchase price paid to it therefor, together with an amount equal to such paying Bank’s,

 

5

Swap Bank’s or Physical Trade Bank’s ratable share (according to the proportion of (1) the amount of such paying Bank’s, Swap Bank’s or Physical Trade Bank’s required repayment to (2) the total amount so recovered from the purchasing Bank, Swap Bank or Physical Trade Bank) of any interest or other amount paid or payable by the purchasing Bank, Swap Bank or Physical Trade Bank in respect of the total amount so recovered. The Borrower agrees that any Bank, Swap Bank or Physical Trade Bank so purchasing a participation from another Bank, Swap Bank or Physical Trade Bank may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off, but subject to Section 11.09 of the Credit Agreement) with respect to such participation as fully as if such Bank, Swap Bank or Physical Trade Bank were the direct creditor of the Borrower in the amount of such participation. Agent will keep records (which shall be conclusive and binding in the absence of manifest error) of participations purchased under this Section and will in each case notify the Banks, Swap Banks and Physical Trade Banks following any such purchases or repayments.

(iii) The provisions of Sections 2.01(b)(ii) and 2.01(f) shall not apply to Payments to the Banks with respect to interest on the Loans, L/C Borrowings, Physical Trade Obligations (if any), Swap Obligations (if any) or fees payable pursuant to Sections 2.09 and 3.08 of the Credit Agreement.

(iv) For purposes of applying the provisions of Sections 2.01(b)(ii) and 2.01(f) , the Adjusted Pro Rata Share shall be calculated initially as soon as practicable after the date of the Sharing Event and, thereafter, pursuant to Section 2.01(f) , shall be recalculated from time to time. Such recalculations shall (A) in all cases, except the recalculation pursuant to Section 2.01(f) as of the Final Date, be made in accordance with the definition of Adjusted Pro Rata Share, but shall be made (1) as of the date of such recalculation, and (2) solely to give effect to (x) increases and decreases in any Permitted SPT Bank Close-Out Amounts as a result of fluctuations in market values and interest rates and (y) new Loans and L/C Obligations under the Borrowing Base Line arising on or after the date of the Sharing Event, to the extent such new Loans or L/C Obligations have been consented to by the Required Banks without regard to the application of Payments pursuant to Section 2.01(b)(ii) or payments made pursuant to Section 2.01(f) and (B) in the case of the final recalculation as of the Final Date, be made in accordance with the definition of Adjusted Pro Rata Share but as of the date of recalculation.

(c) After the date of the occurrence of any Sharing Event, if any SPT Bank Close-Out Amount due to any Swap Bank or any Physical Trade Bank from the Borrower shall increase or decrease as a result of changes in market values or interest rates:

(i) In the event of any such increase, nothing contained herein shall modify or impair any right of such Swap Bank to terminate its Swap Contract or such Physical Trade Bank to terminate its Physical Trade Contract or exercise any other rights or remedies available to it, and any such Swap Bank or Physical Trade Bank may also, in its sole discretion from time to time, notify the Agent of such increase, who shall promptly notify the then Approving Banks of such increase. If all Approving Banks determine in their sole discretion to approve a Loan to the Borrower for the purpose of providing cash collateral in the amount of such increase to such Swap Bank or Physical Trade Bank, then all such Approving Banks shall make such Loan in such amount which shall be disbursed to such Swap Bank or Physical Trade Bank and the Swap Bank or Physical Trade Bank shall apply the proceeds of such Loan to the cash collateralization of the obligations under the relevant Swap Contract or Physical Trade Contract; provided that (A) the payment of such funds to the Swap Bank or Physical Trade Bank for use as such cash collateral shall be deemed not to constitute a Payment hereunder, and (B) no such Loan

 

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shall, without consent of all the Approving Banks, cause the sum of the Effective Amounts of all outstanding Loans plus L/C Obligations to exceed the aggregate Uncommitted Line Portions or the Effective Amount of all outstanding Loans plus L/C Obligations to exceed the Borrowing Base Advance Cap.

(ii) Each Swap Bank or Physical Trade Bank shall, at the Agent’s request, notify the Agent not later than five (5) Business Days after the date of a Sharing Event of its SPT Bank Close-Out Amount as of the date of such Sharing Event and not later than five (5) Business Days after each month of the amount of its SPT Bank Close-Out Amount and the components thereof as of the last Business Day of the preceding month.

(d) If an Event of Default occurs, the Agent shall, if instructed by Required Banks in their sole discretion, notify any or all of the Swap Banks to terminate any or all Swap Contracts, exercise the right to draw under any letter of credit supporting payment of the Borrower’s Obligations under the Swap Contracts or realize on collateral held by such Swap Banks for such Obligations, or any combination of such rights and remedies. Each of the Swap Banks shall, on the next Business Day after receipt of such notice, or on such later Business Day as is set forth in such notice, terminate all or any of its Swap Contracts and exercise such other remedies, all as set forth in such notice, except if prohibited from doing so by applicable law or court order. The foregoing shall not limit the right of any Swap Bank to terminate any or all Swap Contracts to the extent permitted by its Swap Contracts prior to receipt of such notice.

(e) If an Event of Default occurs, the Agent shall, if instructed by Required Banks in their sole discretion, notify any or all of the Physical Trade Banks to terminate any or all Physical Trade Contracts, exercise the right to draw under any letter of credit supporting payment of the Borrower’s Obligations under the Physical Trade Contracts or realize on collateral held by such Physical Trade Banks for such Obligations, or any combination of such rights and remedies. Each of the Physical Trade Banks shall, on the next Business Day after receipt of such notice, or on such later Business Day as is set forth in such notice, terminate all or any of its Physical Trade Contracts and exercise such other remedies, all as set forth in such notice, except if prohibited from doing so by applicable law or court order. The foregoing shall not limit the right of any Physical Trade Bank to terminate any or all Physical Trade Contracts to the extent permitted by its Physical Trade Contracts prior to receipt of such notice.

(f) Each Swap Bank and Physical Trade Bank shall promptly notify the Agent, within one (1) Business Day following the Agent’s request from time to time, of the SPT Bank Close-Out Amount due to such Swap Bank or such Physical Trade Bank on a particular date. The Agent shall, upon request of any Bank, notify the Banks each week of the gross and net SPT Bank Close-Out Amount due to each Swap Bank and each Physical Trade Bank. The Agent shall, at the request of any Bank (but not more than one time each month unless the Agent consents to do so) and promptly after the date of termination of all Swap Contracts and all Physical Trade Contracts which are counted for purposes of determining SPT Bank Close-Out Amounts (the “ Final Date ”), recalculate the Adjusted Pro Rata Share as provided in Section 2.01(b)(iv) . In the case of the recalculation as of the Final Date, only, the Agent shall notify the Banks, Swap Banks and Physical Trade Banks as to any adjustment in prior payments and distributions to them as a result of such recalculation. Each Bank, Swap Bank and Physical Trade Bank shall promptly upon receipt of such notice pay to the Agent for distribution to the other Banks, Swap Banks and Physical Trade Banks such amounts, if any, as shall be specified in each such notice. Such calculations and adjustments shall be conclusive in the absence of manifest error.

 

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(g) [RESERVED].

(h) If, in accordance with the provisions hereof, the Agent recalculates the Adjusted Pro Rata Share more than once in any calendar month, the Borrower shall, upon the Agent’s request, immediately pay an administrative fee for the account of the Agent in an amount equal to $2,500 for each such recalculation more than once in any calendar month.

(i) In order to qualify as a Swap Bank Close-Out Amount under a Swap Contract, such Swap Contract must provide for calculation of payments due on an “early termination date” or its equivalent or upon a “termination date” or its equivalent on the basis of Market Quotations (as defined in the applicable ISDA Master Agreement) or its equivalent. If (i) any Swap Bank shall receive notice of the occurrence of a Sharing Event and thereafter shall enter into any new Swap Contract or amendment of any Swap Contract without consent of the Required Banks or (ii) any Swap Bank shall receive notice from the Required Banks following the declaration of an Event of Default to terminate any or all Swap Contracts, but fails to immediately do so, then unless otherwise agreed by the Required Banks, any increases in the Swap Bank Close-Out Amount owing to any Swap Bank resulting therefrom shall be excluded in calculating Swap Bank Close-Out Amounts.

(j) In order to qualify as a Physical Trade Bank Close-Out Amount under a Physical Trade Contract, such Physical Trade Contract must provide for calculation of payments due on an “early termination date” or its equivalent or upon a “termination date” or its equivalent on the basis of Market Quotations (as defined in the applicable ISDA Master Agreement) or its equivalent. If (i) any Physical Trade Bank shall receive notice of the occurrence of a Sharing Event and thereafter shall enter into any new Physical Trade Contract or amendment of any Physical Trade Contract without consent of the Required Banks or (ii) any Physical Trade Bank shall receive notice from the Required Banks following the declaration of an Event of Default to terminate any or all Physical Trade Contracts, but fails to immediately do so, then unless otherwise agreed by the Required Banks, any increases in the Physical Trade Bank Close-Out Amount owing to any Physical Trade Bank resulting therefrom shall be excluded in calculating Physical Trade Bank Close-Out Amounts.

(k) Each Bank, Swap Bank and Physical Trade Bank party hereto hereby acknowledges and agrees that the security interests granted in favor of the Collateral Agent for the benefit of the Secured Parties are subject in right of priority to each Cross-Affiliate Netting Lien and that proceeds of any Collateral pledged by the Borrower to a Cross-Affiliate Creditor pursuant to a Cross-Affiliate Netting Lien shall be distributed first to the applicable Cross-Affiliate Creditor with the remainder, if any, being distributed as provided in Section 2.01(b)(i) hereof.

2.02 The Election of Banks to Continue Funding . After the Conversion to Reduced Funding Banks Date, if a Sharing Event shall have occurred, the Approving Banks’ and other Banks’ Adjusted Pro Rata Share shall be adjusted on the basis of each advance and Issuance of a Letter of Credit after such date.

2.03 Swap Banks .

(a) All payments required to be made to or by any Swap Bank pursuant to the provisions of Section 2.01 hereof or pursuant to any participation purchased or sold under Section 2.01 hereof shall be paid to or by the Bank that is the Affiliate of such Swap Bank. Each such Bank irrevocably and unconditionally agrees to pay such obligations of the Swap Bank that is its Affiliate. Each of the Banks shall also cause its affiliated Swap Bank to comply with all provisions of Section 2.01 hereof.

 

8

(b) Each Swap Bank that is an Affiliate of a Bank hereby appoints the Agent as its agent for purposes of the Security Agreements; provided that, (i) no Swap Bank shall have any right, remedy or claim of any nature against the Agent, all of which are released; provided that, such release shall not affect any claim of the Bank which is an Affiliate of such Swap Bank under Section 2.03(a) hereof, and (ii) each Swap Bank shall be entitled to recover only from its Affiliate Bank any amount to which it may be entitled hereunder and under the Security Agreement.

2.04 Physical Trade Banks .

(a) All payments required to be made to or by any Physical Trade Bank pursuant to the provisions of Section 2.01 hereof or pursuant to any participation purchased or sold under Section 2.01 hereof shall be paid to or by the Bank that is the Affiliate of such Physical Trade Bank. Each such Bank irrevocably and unconditionally agrees to pay such obligations of the Physical Trade Bank that is its Affiliate. Each of the Banks shall also cause its affiliated Physical Trade Bank to comply with all provisions of Section 2.01 hereof.

(b) Each Physical Trade Bank that is an Affiliate of a Bank hereby appoints the Agent as its agent for purposes of the Security Agreements provided that (i) no Physical Trade Bank shall have any right, remedy or claim of any nature against the Agent, all of which are released, provided that such release shall not affect any claim of the Bank which is an Affiliate of such Physical Trade Bank under Section 2.04(a) hereof, and (ii) each Physical Trade Bank shall be entitled to recover only from its Affiliate Bank any amount to which it may be entitled hereunder and under the Security Agreement.

ARTICLE III

MISCELLANEOUS

3.01 Amendments and Waivers .

(a) No amendment or waiver of any provision of this Agreement, and no consent with respect to any departure by a party therefrom, shall be effective unless the same shall be in writing signed by all the parties hereto, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided that, any such amendment or waiver may be effected without the consent of the Borrower so long as the Borrower is not directly affected thereby.

(b) No party shall have any duty to disclose any financial or other information available to it to any other party, except as expressly provided herein.

3.02 Notices .

(a) All notices, requests and other communications shall be in writing (including, unless the context expressly otherwise provides, by facsimile transmission) and mailed, faxed or delivered, to the address or facsimile number specified on the signature pages hereof; or to such other address as shall be designated by such party in a written notice to the other parties.

(b) All such notices, requests and communications shall, when transmitted by mail, overnight delivery, or faxed, be effective when delivered for overnight (next-day) delivery, or transmitted in legible form by facsimile machine, respectively, or if mailed, upon the third Business Day after the date deposited into the U.S. mail, or if delivered, upon delivery.

 

9

3.03 No Waiver; Cumulative Remedies . No failure by any party hereto to exercise and no delay by such Person in exercising any right, remedy, power or privilege hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein or therein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

3.04 Payments Set Aside . To the extent that the Borrower makes a payment to the Agent, any Bank, any Swap Bank or any Physical Trade Bank, or Agent, any Bank, any Swap Bank or any Physical Trade Bank exercises its right of set-off, and such payment or the proceeds of such set-off or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by such Person in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any debtor relief law or otherwise, then (a) to the extent of such recovery, the obligation or part to such Person originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such set-off had not occurred, and (b) each Bank, Swap Bank and Physical Trade Bank severally agrees to pay to such Person upon demand its applicable share of any amount so recovered from or repaid by such Person which such Person had paid to such Bank, Swap Bank or Physical Trade Bank, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect.

3.05 Successors and Assigns . The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective permitted successors and assigns as provided in Section 11.08 of the Credit Agreement, except that (a) Borrower may not assign or transfer any of its rights or Obligations under this Agreement without the prior written consent of all Banks, (b) no Bank shall assign its rights or obligations hereunder except to a Bank, and (c) no Swap Bank or Physical Trade Bank shall assign its rights or obligations hereunder except to a Bank or an Affiliate of a Bank which agrees to be bound hereby pursuant to an agreement satisfactory to the Agent.

3.06 Integration . This Agreement comprises the complete and integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event of any conflict between the provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement shall control.

3.07 Counterparts . This Agreement may be executed in any number of separate counterparts, each of which, when so executed, shall be deemed an original, and all of said counterparts taken together shall be deemed to constitute but one and the same instrument.

3.08 Severability . The illegality or unenforceability of any provision of this Agreement or any instrument or agreement required hereunder shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Agreement or any instrument or agreement required hereunder.

3.09 No Third Parties Benefited . This Agreement is made and entered into for the sole protection and legal benefit of, the Agent, the Banks, the Swap Banks and the Physical Trade Banks and their permitted successors and assigns, and no other Person (including, without limitation, the Borrower) shall be a direct or indirect legal beneficiary of, or have any direct or indirect cause of action or claim in connection with, this Agreement.

 

10

3.10 Survival, etc .

(a) All covenants and agreements contained herein shall survive the execution and delivery hereof.

(b) The terms of this agreement shall survive and shall continue in full force and effect in any bankruptcy or other proceeding referred to in Section 9.01(e) and (f)  of the Credit Agreement. References to the Borrower herein shall include the Borrower as a debtor and debtor in possession and any receiver or trustee appointed in any such proceeding.

(c) No party shall have any right to terminate its obligations hereunder except if (i) all Obligations to such party shall have been indefeasibly paid in full and (ii) such party releases all of its rights in and liens on the Collateral and rights hereunder.

(d) All rights, interests, agreements and obligations of the party hereto shall remain in full force and effect irrespective of:

(i) any lack of validity or enforceability of any Loan Documents, Swap Contract, Physical Trade Contract or Obligations or validity or perfection of any liens thereunder;

(ii) except as otherwise set forth in this Agreement, any change in the time, manner or place of payment of, or in any other terms of, all or any of the Obligations, or any amendment or waiver or other modification, including any increase in the amount thereof, whether by course of conduct or otherwise, of the terms of any Loan Document, Swap Contract, Physical Trade Contract or Obligation;

(iii) any release or subordination of any security interest in any Collateral or any other collateral, any substitution of collateral, or any amendment, waiver or other modification, whether in writing or by course of conduct or otherwise, of any such security interest;

(iv) any other circumstances which otherwise might constitute a defense available to, or a discharge or, the obligations under this Agreement.

3.11 Governing Law and Jurisdiction .

(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF OTHER THAN SECTION 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK .

(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE STATE COURTS LOCATED IN NEW YORK COUNTY, CITY OF NEW YORK, STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, AGENT, EACH SWAP BANK AND EACH PHYSICAL TRADE BANK CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWER, AGENT, EACH BANK,

 

11

SWAP BANK AND EACH PHYSICAL TRADE BANK IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS , WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT.

3.12 Waiver of Jury Trial . THE PARTIES EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE PARTIES AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

3.13 Entire Agreement . THIS AGREEMENT EMBODIES THE ENTIRE AGREEMENT AND UNDERSTANDING AMONG THE PARTIES RELATING TO ITS SUBJECT MATTER, AND SUPERSEDES ALL PRIOR OR CONTEMPORANEOUS AGREEMENTS AND UNDERSTANDINGS OF SUCH PERSONS, VERBAL OR WRITTEN, RELATING TO THE SUBJECT MATTER HEREOF.

3.14 Intercreditor Agreement . Each party hereto agrees that it shall take no action to terminate its obligations under this Agreement and will otherwise be bound by and take no actions contrary to this Agreement; provided that the foregoing shall not limit or impair the right of any Bank to assign its rights and delegate its obligations arising under the Credit Agreement pursuant to Section 11.08 of the Credit Agreement.

3.15 SPT CONTRACTS . FOR THE AVOIDANCE OF DOUBT, NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED AS CREATING ON BEHALF OF ANY SPT BANK AN OBLIGATION OF ANY KIND TO ENTER INTO A SPT CONTRACT AT ANY TIME.

3.16 Joinder . From and after the date hereof, any entity that would qualify as a SPT Bank (as defined in the Credit Agreement) upon becoming a party to this Agreement, join this Agreement by executing an Intercreditor Agreement Addendum in the form attached hereto as Exhibit A .

[SIGNATURES FOLLOW]

 

12

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

 

FORTIS CAPITAL CORP., as Agent
By:  

/s/ IRENE C. RUMMEL

Name:   Irene C. Rummel
Title:   Director
By:  

/s/ CHAD CLARK

Name:   Chad Clark
Title:   Director
Address for Notices :
15455 North Dallas Parkway, Suite 1400
Addison, Texas 75001
Attention: Irene C. Rummel
Telephone: (214) 953-9313
Facsimile: (214) 969-9332
FORTIS CAPITAL CORP., as a Bank
By:  

/s/ IRENE C. RUMMEL

Name:   Irene C. Rummel
Title:   Director
By:  

/s/ CHAD CLARK

Name:   Chad Clark
Title:   Director
FORTIS ENERGY MARKETING & TRADING GP , as a Swap Bank and a Physical Trade Bank
By:  

/s/ DAVID J. GREEN

Name:   David J. Green
Title:   Managing Director
By:  

/s/ WILLIAM DAVID DURAN

Name:   William David Duran
Title:   Managing Director
Address for Notices :
1100 Louisiana Street, Suite 4900
Houston, Texas 77002
Attention: Credit Manager
Telephone: (713) 393-6800
Facsimile: (713) 890-3111

[Signature Page to Intercreditor Agreement]

BNP PARIBAS,
as a Bank and as a Swap Bank
By:  

/s/ EDWARD K. CHIN

Name:   Edward K. Chin
Title:   Managing Director
By:  

/s/ ANDREW STRATOS

Name:   Andrew Stratos
Title:   Vice President
Address for Notices :
787 Seventh Avenue
New York, NY 10019
Attention: Ed Chin
Phone: (212) 841-2020
Fax: (212) 841-2536

 

[Signature Page to Intercreditor Agreement]

SOCIÉTÉ GÉNÉRALE,
as a Bank and as a Swap Bank
By:  

/s/ BARBARA PAULSEN

Name:   Barbara Paulsen
Title:   Managing Director
By:  

/s/ EMMANUEL CHESNEAU

Name:   Emmanuel Chesneau
Title:   Managing Director
Address for Notices :
1221 Avenue of the Americas
New York, NY 10020
Attn: Barbara Paulsen
Phone: (212) 278-6496
Fax: (212) 278-7953

 

[Signature Page to Intercreditor Agreement]

NATIXIS, acting through its New York Branch,
as a Bank and Swap Bank
By:  

/s/ DAVID PERSHAD

Name:   David Pershad
Title:   Managing Director
By:  

/s/ JULIEN MATHIEU

Name:   Julien Mathieu
Title:   Associate Director
Address for Notices :
1251 Avenue of the Americas, 34 th Floor
New York, New York 10020
Attention: David Pershad
Telephone: (212) 872-5015
Facsimile: (212) 354-9095

 

[Signature Page to Intercreditor Agreement]

RZB FINANCE LLC, as a Bank
By:  

/s/ HERMINE KIROLOS

Name:   Hermine Kirolos
Title:   Group Vice President
By:  

/s/ ASTRID WILKE

Name:   Astrid Wilke
Title:   Vice President
Address for Notices :
1133 Avenue of the Americas
New York, New York 10036
Attention: Hermine Kirolos
Telephone: (212) 845-4114
Facsimile: (212) 944-6389

 

[Signature Page to Intercreditor Agreement]

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as a Bank
By:  

/s/ LINDA TERRY

Name:   Linda Terry
Title:   Vice President and Manager
Address for Notices :
The Bank of Tokyo-Mitsubishi UFJ, Ltd.,
New York Branch
1251 Avenue of the Americas
New York, New York 10020-1104
Attention: USCB Portfolio Management Group
Facsimile: (212) 782-4979
with a copy to :
The Bank of Tokyo-Mitsubishi UFJ, Ltd.,
Houston Agency
1100 Louisiana Street,
Suite 2800
Houston, Texas 77002
Attention: Damain Sullivan
Telephone: (713) 655-3808
Facsimile: (713) 658-0116

 

[Signature Page to Intercreditor Agreement]

BROWN BROTHERS HARRIMAN & CO.,
as a Bank
By:  

/s/ MICHAEL L. VELLUCCI

Name:   Michael L. Vellucci
Title:   Senior Vice President
Address for Notices :
140 Broadway
New York, NY 10005
Attention: Paul Feldman
Telephone: (212) 493-7732
Facsimile: (212) 493-8998

 

[Signature Page to Intercreditor Agreement]

THE ROYAL BANK OF SCOTLAND plc,
as a Bank
By:  

/s/ MATTHEW MAIN

Name:   Matthew Main
Title:   Managing Director
By:  

 

Name:  
Title:  
Address for Notices :
101 Park Avenue, 6 th Floor
New York ,New York 10178
Attention: Alisa Williams
Telephone: (212) 401-3200
With copies to :
600 Travis St, Suite 6500
Houston, Texas 77002
Attention: Matthew Main
Telephone: (713) 221-2441
Facsimile: (713) 221-2430

 

[Signature Page to Intercreditor Agreement]

CONSENTED AND AGREED TO:
ATMOS ENERGY MARKETING, LLC
By:  

/s/ C. RICHARD ALFORD

Name:   C. Richard Alford
Title:   Senior Vice President
Address for Notices :
13430 Northwest Freeway, Suite 700
Houston, TX 77040
Attention: Ronald W. Bahr
Telephone: (713) 688-7771
Facsimile: (713) 688-5124

 

[Signature Page to Intercreditor Agreement]

EXHIBIT A TO

INTERCREDITOR AGREEMENT

INTERCREDITOR AGREEMENT ADDENDUM

Reference is made to the INTERCREDITOR AGREEMENT ADDENDUM, dated as of March 31, 2008 (as amended, supplemented or otherwise modified from time to time, the “ Agreement ”), among FORTIS CAPITAL CORP., a Connecticut corporation, in its capacity as Collateral Agent (together with its successors and assigns in such capacity, the “ Agent ”) for the Banks, Swap Banks, Physical Trade Banks and each other financial institution from time to time party thereto. Unless otherwise defined herein, capitalized terms used herein and defined in the Agreement are used herein as therein defined.

Upon execution and delivery of this Addendum, the undersigned shall, pursuant to Section 3.16 of the Agreement and to the extent that the undersigned otherwise qualifies as a SPT Bank under the Credit Agreement, become a SPT Bank under the Agreement effective as of the date hereof, with the maximum close out amounts set forth in Schedule 1 hereto; provided that each close-out amount listed on Schedule 1 hereto shall not be greater than the largest maximum amount listed in the applicable column of the table of close-out amounts set forth under the definition of “Permitted SPT Bank Close-Out Amounts” and if any amount on Schedule 1 hereto exceeds such amount, such amount set forth in Schedule 1 will be reduced by the required amount so that such amount matches the largest maximum amount listed in such table. The table of close-out amounts set out under the definition of “Permitted SPT Bank Close-Out Amounts” shall be updated, as of the date hereof, to reflect the new SPT Bank and its maximum close-out amounts as set forth on Schedule 1 subject to the foregoing limitations.

THIS ADDENDUM SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

This Addendum may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature page hereof by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.

IN WITNESS WHEREOF, the undersigned hereto has caused this Addendum to be duly executed and delivered by its proper and duly authorized officer as of this          day, of              , 200      .

 

[NAME OF NEW SPT BANK]
By:  

 

Name:  
Title:  

SCHEDULE 1 TO

INTERCREDITOR ADDENDUM

 

SPT Bank (and its SPT Bank Affiliates, in the aggregate)

   Maximum
Swap Bank
Close-Out
Amount
   Maximum
Physical Trade
Bank
Close-Out Amount
   Maximum SPT
Bank Close-Out
Amount