First Amendment to Guaranty
Exhibit 10(v)-12
First Amendment to Guaranty
This First Amendment to Guaranty dated as of September 30, 2008 (the or this
“Amendment”) to the Guaranty Agreement referred to below is among EnergySouth, Inc., a
Delaware corporation (the “Guarantor”), and each of the institutions which is a signatory to this
Amendment (collectively, the “Noteholders”).
R e c i t a l s :
A. Bay Gas Storage Company, Ltd., an Alabama limited partnership (the “Company”), and
Regions Bank, an Alabama banking corporation, as trustee (the “Trustee”), have heretofore entered
into the Trust Indenture and Security Agreement dated as of December 1, 2000 (the “Indenture”)
pursuant to which the Company issued its Series 8.45% Senior Secured Notes due December 1, 2017
(the “Notes”).
B. As a condition to the issuance of the Notes, the Guarantor executed the Guaranty Agreement
dated as of December 1, 2000 (the “Guaranty”), pursuant to which the Guarantor guaranteed unto the
Trustee, for the benefit of the Noteholders, the payment of the principal of, premium, if any, and
interest on the Notes, the payment upon the demand by the Trustee of costs and expenses expended or
incurred in connection with the Notes, the Note Agreements (as defined in the Guaranty), the
Indenture or the Guaranty, and the performance of all obligations of the Company under the
Indenture, the Notes and the Note Agreements (as defined in the Guaranty).
C. The Company and the Noteholders now desire to amend certain provisions of the Guaranty as
of September 30, 2008 (the “Effective Date”) in the respects, but only in the respects, hereinafter
set forth.
D. Capitalized terms used herein shall have the respective meanings ascribed thereto in the
Guaranty unless herein defined or the context shall otherwise require.
Now, therefore, upon the full and complete satisfaction of the conditions precedent
to the effectiveness of this Amendment set forth in Section 3 hereof, and for good and valuable
consideration the receipt and sufficiency of which is hereby acknowledged, the Guarantor and the
Noteholders do hereby agree as follows:
Section 1. Amendment to Guaranty and Waiver of Notice.
Section 1.1. The following definition in Section 7.1 of the Guaranty shall be and is hereby
amended to read as follows:
“Consolidated Net Income Available for Fixed Charges” for any period shall mean the sum
of (a) Consolidated Net Income during such period plus (to the extent deducted in
determining Consolidated Net Income), (b)(i) all provisions for any Federal, state or other
income taxes made by the Guarantor and its Subsidiaries during such
| EnergySouth, Inc. | First Amendment to Guaranty |
period, (ii) Consolidated Fixed Charges of the Guarantor and its Subsidiaries during such
period, and (iii) the Excluded Merger Transaction Expenses (up to the maximum amount
specified in the definition for such term).
Section 1.2. Section 7.1 of the Guaranty shall be and is hereby amended by adding, in
appropriate alphabetical order, the following definitions:
“Excluded Merger Transaction Expenses” shall mean, collectively: (i) the aggregate of
the investment banking, financial advisory and legal fees, printing and proxy solicitation
costs, and other one-time costs and expenses paid by the Guarantor with respect to the
Merger Transaction, in a total amount not to exceed $12,500,000; and (ii) accelerated equity
and equity based award payments required to be expensed by the Guarantor in connection with
the Merger Transaction, in a total amount not to exceed (x) $2,500,000, less (y) any such
amounts paid or reimbursed, or agreed to be paid or reimbursed, by Sempra or any of its
direct or indirect Subsidiaries that are included in the Guarantor’s Consolidated Net
Income.
“Merger Transaction” shall mean the merger of EMS Holdings Corp., a Delaware
corporation, and an indirect wholly owned subsidiary of Sempra, with and into the Guarantor,
with the Guarantor being the surviving corporation in such merger transaction, pursuant to
the terms of the Agreement and Plan of Merger, dated as of July 25, 2008, by and among
Sempra Energy, EMS Holding Corp. and EnergySouth, Inc.
“Sempra” means Sempra Energy, a California corporation.
Section 1.3. The Trustee and the Noteholders hereby waive the requirement under Section 3.04
of the Indenture that the Company deliver a Company Notice to the Trustee and the holders of the
Notes regarding the Change of Control occurring in connection with the Merger Transaction. The
foregoing waiver extends solely to the notice requirement identified in the preceding sentence, and
no waiver of any other covenant, term or provision of the Indenture is granted or implied herein.
Section 2. Representations and Warranties of the Guarantor.
To induce the Noteholders to execute and deliver this Amendment (which representations shall
survive the execution and delivery of this Amendment), the Guarantor represents and warrants to the
Noteholders that:
(a) this Amendment has been duly authorized, executed and delivered by the Guarantor
and this Amendment constitutes a legal, valid and binding obligation of the Guarantor
enforceable against the Guarantor in accordance with its terms, except as such
enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors’ rights generally
and (ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
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| EnergySouth, Inc. | First Amendment to Guaranty |
(b) the Guaranty, as amended by this Amendment, constitutes a legal, valid and binding
obligation of the Guarantor enforceable against the Guarantor in accordance with its terms,
except as such enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of creditors’
rights generally and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(c) the execution, delivery and performance by the Guarantor of this Amendment will not
(i) contravene, result in any breach of, or constitute a default under, or result in the
creation of any Lien in respect of any property of the Guarantor under, any indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease, charter or by-laws, or
any other agreement or instrument to which the Guarantor is bound or by which the Guarantor
or any of its properties may be bound or affected, (ii) conflict with or result in a breach
of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of
any court, arbitrator or Governmental Authority applicable to the Guarantor or (iii) violate
any provision of any statute or other rule or regulation of any Governmental Authority
applicable to the Guarantor;
(d) no consent, approval or authorization of, or registration, filing or declaration
with, any Governmental Authority is required in connection with the execution, delivery or
performance by the Guarantor of this Amendment;
(e) no Default or Event of Default has occurred which is continuing; and
(f) since September 30, 2007, there has been no change in the financial condition,
operations, business, properties or prospects of the Guarantor except changes that
individually or in the aggregate could not reasonably be expected to have a Material Adverse
Effect.
Section 3. Conditions to Effectiveness of This Amendment.
This Amendment shall become effective and binding upon the Guarantor and the Noteholders on
the Effective Date upon the Noteholders’ acceptance in the space below and upon the satisfaction in
full of each and every one of the following conditions:
(a) executed counterparts of this Amendment, duly executed by the Guarantor and the
holders of at least 51% in aggregate principal amount of the outstanding Notes (the
“Required Noteholders”) and acknowledged by the Trustee, shall have been delivered to the
Trustee and each of the Noteholders;
(b) the Merger Transaction shall have been consummated; and
(c) the representations and warranties of the Guarantor set forth in Section 2 hereof
shall be true and correct on and with respect to the date hereof, and execution of this
Amendment by the Guarantor shall constitute its certification of the same.
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| EnergySouth, Inc. | First Amendment to Guaranty |
Upon receipt or satisfaction of all of the foregoing, this Amendment shall become effective.
Section 4. Payment of Counsel Fees and Expenses.
The Guarantor agrees to pay upon demand, the reasonable fees and expenses of Xxxxxxx and
Xxxxxx LLP, special counsel to the Noteholders, in connection with the preparation, negotiation,
execution and delivery of this Amendment.
Section 5. Miscellaneous.
Section 5.1. This Amendment shall be construed in connection with and as part of the Guaranty,
and except as modified and expressly amended by this Amendment, all terms, conditions and covenants
contained in the Guaranty are hereby ratified and confirmed and remain in full force and effect.
Section 5.2. Any and all notices, requests, certificates and other instruments executed and
delivered after the execution and delivery of this Amendment may refer to the Guaranty without
making specific reference to this Amendment but nevertheless all such references shall include this
Amendment unless the context otherwise requires.
Section 5.3. The descriptive headings of the various Sections or parts of this Amendment are
for convenience only and shall not affect the meaning or construction of any of the provisions
hereof.
Section 5.4. This Amendment shall be governed by and construed in accordance with the laws of
the State of Alabama.
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| EnergySouth, Inc. | First Amendment to Guaranty |
Section 5.5. The execution hereof by you shall constitute a contract between us for the uses
and purposes hereinabove set forth, and this Amendment may be executed in any number of
counterparts, each executed counterpart constituting an original, but all together only one
agreement.
| EnergySouth, Inc. | ||||||
| By | /s/ Xxxxxxx X. Xxxxxxx
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| Title: Executive Vice President and Chief Financial Officer |
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| EnergySouth, Inc. | First Amendment to Guaranty |
| Noteholders: | ||||||
| Xxxx Xxxxxxx Life Insurance Company | ||||||
| By | /s/ Xxxx X. Xxxx
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| Title: Director | ||||||
| Xxxx Xxxxxxx Variable Life Insurance Company | ||||||
| By | /s/ Xxxx X. Xxxx
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| Title: Director | ||||||
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| EnergySouth, Inc. | First Amendment to Guaranty |
| Prudential Retirement Insurance and | ||||||
| Annuity Company | ||||||
| By: Prudential Investment Management, Inc. | ||||||
| as investment manager | ||||||
| By | /s/ Xxxxx X. Xxxxxx
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| Title: Vice President | ||||||
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| EnergySouth, Inc. | First Amendment to Guaranty |
| Modern Woodmen of America | ||||||
| By | /s/ Xxxxxxx X. Xxxxxxx
Title: Portfolio Manager—Private Placements |
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| EnergySouth, Inc. | First Amendment to Guaranty |
| Acknowledged and agreed: | ||||
| Regions Bank, as trustee under the Trust | ||||
| Indenture and Security Agreement dated as of December 1, 2000 |
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By
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/s/ Xxxxxxx X. Xxxx
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| Title: Vice President & Corp Trust Officer | ||||
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| EnergySouth, Inc. | First Amendment to Guaranty |
| Acknowledged and agreed: | ||||
| Bay | Gas Storage Company, Ltd. | |||
By
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EnergySouth Midstream, Inc., | |||
| f/k/a Energy South Storage Services, Inc., | ||||
| f/k/a MGS Storage Services, Inc., | ||||
| its Sole General Partner | ||||
By
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/s/ Xxxxxxx X. Xxxxxxx
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| Title: Executive Vice President and Chief Financial Officer |
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