As of December 11, 2008
XX XXXX (Yorkville I), LLC
Xxx Xxxx Xxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Re: Amendment of Credit Agreement dated as of January 11, 2008
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Gentlemen:
Reference is made to that certain Credit Agreement, dated as of January 11,
2008 (as amended and in effect from time to time, the "Credit Agreement"), by
and between XX XXXX (Yorkville I), LLC, as borrower (the "Borrower") and YA
Global Investments, L.P., as lender (the "Lender"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings set forth in the
Credit Agreement.
The Borrower has requested that the Lender increase the Revolving Loan
Ceiling under the Credit Agreement to $13,750,000.00, make an advance to pay for
accrued and unpaid interest, and amend certain other terms of the Credit
Agreement. The Borrower has further requested that the Lender consent to the
following transactions (collectively, the "Transactions"): (i) to the Borrower
and/or GreenShift forming the following new subsidiaries (collectively, the "New
Subsidiaries"): GS Big Management, LLC ("GS Management"), XX XXXX (Xxxxxx I),
LLC ("GS Adrian"), and GS Technology, LLC ("GS Technology"), (ii) to GreenShift
and GS Adrian entering into a certain Membership Interest Purchase and Equity
Capital Contribution Agreement (the "ECCA") with Biofuel Industries Group, LLC
("BIG"), GS (NextDiesel I) LLC ("GS NextDiesel"), and CleanBioenergy Partners,
LLC ("CBP"), in the form attached hereto as Exhibit "A", (iii) to GreenShift and
GS Adrian entering into a certain Amended and Restated Limited Liability Company
Agreement of GS (NextDiesel I) LLC (the "GS NextDiesel LLC Agreement") with CBP,
in the form attached hereto as Exhibit "B", regarding the formation and
operation of GS NextDiesel and to the contribution to GS NextDiesel by the
Borrower of certain COES Installations and contracts related thereto and the
Class B Membership Interest of BIG currently held by the Borrower, (iv) consent
to BIG and GS Technology entering into certain agreements and contracts with
CBP, GS NextDiesel, and/or BIG regarding the construction/expansion,
maintenance, and management of a biodiesel production plant located in Adrian,
Michigan (the "BIG Facility"), and the operation and maintenance of certain COES
Installations (collectively, the "Project Documents"). The ECCA, the GS
NextDiesel LLC Agreement, the Project Documents, and all documents related
thereto or to be executed in connection therewith, shall be collectively
referred to as the "Transaction Documents"). The Lender has agreed to amend the
Credit Agreement, and to consent to the Transactions, but only on the express
terms of this letter agreement. Accordingly, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Borrower and the Lender agree as follows:
1. Conditions Precedent. Each of the Lender's agreements contemplated herein
shall not be effective unless and until each of the following conditions
precedent have been fulfilled, all as determined by the Lender in its sole
and exclusive discretion:
(a) The New Subsidiaries shall all have been duly formed and in existence
as Delaware limited liability companies;
(b) The Borrower, the Guarantors, Xxxxxxxxxx & Associates, Inc., and the
New Subsidiaries shall have executed and delivered to the Lender a
Ratification and Joinder to Collateral Agreements in the form attached
hereto as Exhibit "C";
(c) UCC financing statements naming each of the New Subsidiaries and
Xxxxxxxxxx & Associates, Inc. as debtors and the Lender as secured
party shall have been filed in the appropriate filing offices, and
each such entity shall have executed and delivered to the Lender such
other documents, instruments, and agreements as the Lender may require
in order to perfect or vest the Lender's security interests in their
respective assets, and the Lender shall have confirmed, to its
satisfaction, that it holds a perfected, first priority security
interest in all of the New Subsidiaries' and Xxxxxxxxxx & Associates,
Inc.'s assets;
(d) A Voting Agreement in the form attached hereto as Exhibit "D" shall
have been executed by each of the parties thereto and be in effect;
(e) An Exchange Agreement in the form attached hereto as Exhibit "E", and
any documents required in connection therewith, shall have been
executed by each of the parties thereto and be in effect;
(f) The ECCA shall have been executed by each of the parties thereto and
made effective and each of the Transaction Documents shall have been
finalized in a form acceptable to the Lender, and the Lender shall
received evidence acceptable to the Lender that the form of the
Transaction Documents shall have been agreed to by all of the parties
thereto;
(g) The Lender shall have received evidence of appropriate corporate or
other entity approvals and resolutions, in each case satisfactory to
Lender and its counsel in form and substance; and
(h) The Borrower and the Guarantors shall have executed and delivered to
the Lender this letter agreement, and each of the documents,
instruments and agreements required hereunder.
2. Amendment of Credit Agreement. Subject to the satisfaction of the
conditions precedent set forth in Paragraph 1, above, the Credit Agreement
is hereby amended as follows:
(a) The definition of "Build Out Draw Schedule" contained in Section 1.1
is hereby deleted in its entirety, and the following inserted in its
place:
"Build Out Draw Schedule" shall mean that certain schedule setting
forth the timetable for, and costs of, installing COES Installations
in various locations, in the form attached hereto as Exhibit "B", as
the same may be updated, modified, and amended from time to time
pursuant to the mutual agreement, in writing, of the Borrower and the
Lender.
(b) The definition of "Cash Flow Projections" contained in Section 1.1 is
hereby deleted in its entirety.
(c) The definition of "COES Installations" contained in Section 1.1 is
hereby deleted in its entirety, and the following inserted in its
place:
"COES Installations" shall mean the Corn Oil Extraction Systems
installed by the Borrower in the following locations, together with
any other Corn Oil Extraction Systems installed in any other locations
which are financed with the proceeds of the Revolving Advances:
(a) Utica Energy, LLC, 0000 Xxxxx Xxxx 00, Xxxxxxx, XX 00000;
(b) Western New York Energy, LLC, 0000 Xxxxx Xxxx, Xxxxxx, XX
00000;
(c) Central Indiana Ethanol, LLC, 0000 X. Xxxxxx Xxxx, Xxxxxx,
XX 00000;
(d) Global Ethanol, LLC, 00000 Xxxxxxxx Xxxx, Xxxx, XX 00000;
(e) Global Ethanol, LLC - Lakota A, 0000 000xx Xxxxxx, Xxxxxx,
XX 00000;
(f) Global Ethanol, LLC - Xxxxxx X, 0000 000xx Xxxxxx, Xxxxxx,
XX 00000;
(g) Red Trail Ethanol, LLC, 0000 Xxxxxxx 0 Xxxxx, Xxxxxxxxxx, XX
00000;
(h) E Energy Xxxxx, LLC, 00000 Xxxx Xxxxx Xxxx, Xxxxx, XX 00000;
(i) United Ethanol, LLC, 0000 Xxxxxxx Xxxxxx, Xxxxxx, XX 00000;
(j) Northeast Biofuels , LP - A, 000 Xxxx Xxxx, Xxxxxx, XX
00000;
(k) Northeast Biofuels , LP - B, 000 Xxxx Xxxx, Xxxxxx, XX
00000; and
(m) Otter Tail Ag Enterprises, LLC, 00000 000xx Xxx, Xxxxxx
Xxxxx, XX 00000.
(d) The definition of "Collateral Limitation" contained in Section 1.1 is
hereby deleted in its entirety, and the following inserted in its
place:
"Collateral Limitation" shall mean the aggregate unpaid balance of the
Loan Account.
(e) The definition of "Guarantors" contained in Section 1.1 is hereby
deleted in its entirety, and the following inserted in its place:
"Guarantors" shall mean each of GreenShift, GS AgriFuels, GS
CleanTech, GS Design, GS Technology, GS Management, Viridis Capital,
LLC, EcoSystem Corporation, Carbonics Capital Corporation, Xxxxx
Xxxxxxxx, and each of their respective subsidiaries and Affiliates
other than GS NextDiesel and BIG.
(f) The definition of "GreenShift" contained in Section 1.1 is hereby
deleted in its entirety, and the following inserted in its place:
"GreenShift" shall mean GreenShift Corporation, a Delaware
corporation, formerly known as GS CleanTech Corporation.
(g) The definition of "GS Cleantech" contained in Section 1.1 is hereby
deleted in its entirety, and the following inserted in its place:
"GS CleanTech" shall mean GS CleanTech Corporation, a Delaware
corporation, formerly known as GS Ethanol Technologies, Inc.
(h) The definitions of "GS Ethanol" and "GS Energy" are hereby deleted.
(i) The definition of "Maturity Date" contained in Section 1.1 is hereby
deleted in its entirety, and the following inserted in its place:
"Maturity Date" shall mean January 31, 2010.
(j) The definition of "Revolving Loan Ceiling" contained in Section 1.1 is
hereby deleted in its entirety, and the following inserted in its
place:
"Revolving Loan Ceiling" shall mean $13,750,000.00.
(k) The following new definitions shall be inserted into Section 1.1 in
alphabetical order:
"BIG" shall mean Biofuel Industries Group, LLC, a Michigan limited
liability company.
"CBP" shall mean CleanBioenergy Partners, LLC, a Delaware limited
liability company.
"Consent Agreement" shall mean a Consent Agreement in the form
attached hereto as Exhibit "C" to be entered into by and between the
Lender, the Borrower, GS NextDiesel and GreenShift.
"ECCA" shall mean that certain Membership Interest Purchase and Equity
Capital Contribution Agreement dated as of December 5, 2008, entered
into by and among GS NextDiesel, BIG, CBP, GS Adrian, and GreenShift.
"Existing COES" shall mean the COES Installations located at Utica
Energy, LLC, 0000 Xxxxx Xxxx 00, Xxxxxxx, XX 00000 and Western New
York Energy, LLC, 0000 Xxxxx Xxxx, Xxxxxx, XX 00000.
"GS Adrian" shall mean XX XXXX (Xxxxxx I), LLC, a Delaware limited
liability company.
"GS Design" shall mean GS Design, Inc., a Delaware corporation.
"GS Management" shall mean GS BIG Management, LLC, a Delaware limited
liability company.
"GS NextDiesel" shall mean GS (NextDiesel I) LLC, a Delaware limited
liability company.
"GS NextDiesel LLC Agreement" shall mean the Company LLC Agreement (as
defined in the ECCA) in the form attached to the ECCA as Annex 1.
"GS Technology" shall mean GS Technology, LLC, a Delaware limited
liability company.
"Level I Payment" shall mean the payment entitled "Level I Payment"
due with respect to each COES Installation as set forth on Exhibit "D"
attached hereto and incorporated herein by reference.
"Level II Payment" shall mean the payment entitled "Level II Payment"
due with respect to each COES Installation as set forth on Exhibit "D"
attached hereto and incorporated herein by reference.
"Project Document(s)" shall have the meaning set forth in the GS
NextDiesel LLC Agreement.
"Subordination Agreement" shall mean a Subordination Agreement in the
form attached hereto as Exhibit "E" to be entered into by and between
the Lender, GS NextDiesel, and CBP.
"Suspension Date" shall mean the earlier of (i) September 30, 2009, or
(b) the date upon which the Borrower has transferred its tenth COES
Installation (including the Existing COES) to GS NextDiesel in
accordance with the provisions of the GS NextDiesel LLC Agreement and
the ECCA, and subject to the provisions of the Consent Agreement.
"YAGI Release Fee" shall mean an amount equal to $350,000.00 per COES
Installation (other than the Existing COES) that is transferred to GS
NextDiesel, that is required to be paid by GS NextDiesel, or on GS
NextDiesel's behalf, to the Lender at the same time as the Level I
Payment as part of the consideration for the release of the Lender's
security interest in such COES Installation, all as more fully set
forth in the Consent Agreement.
(l) Section 2.1 is hereby deleted in its entirety, and the following
inserted in its place:
2.1 Revolving Advances. The Lender may, in its sole discretion, make
advances to the Borrower from time to time from the date all of the
conditions set forth in Sections 3.1, 3.2, and 3.3 are satisfied (the
"Funding Date") until the earlier of (a) the Termination Date, or (ii)
the Suspension Date, on the terms and subject to the conditions herein
set forth (the "Revolving Advances"). The Lender shall not consider
any request for a Revolving Advance to the extent the amount of the
requested Revolving Advance exceeds Availability. The Borrower's
obligation to pay the Revolving Advances shall be evidenced by the
Revolving Note and shall be secured by the Collateral. Within the
limits set forth in this Section 2, the Borrower may request Revolving
Advances, repay pursuant to Section 2 hereof and request additional
Revolving Advances.
2.1.1 Procedures for Requesting Revolving Advances. On the Funding
Date, the Lender shall make the following Revolving Advances
(collectively, the "Funding Date Advances"): (a) an initial Revolving
Advance of $4,000,000 to the Borrower, (b) a Revolving Advance of
$250,000 to the Lender to pre-pay estimated interest coming due under
the Revolving Credit Facility for the first three (3) months of the
Revolving Credit Facility (the "Prepaid Interest Advance"), (c) a
Revolving Advance of $210,000 to the Lender to pay the fees due to the
Lender under Sections 2.5.1 and 2.5.2 hereof, and (d) a Revolving
Advance of $150,000.00 to the Lender's counsel to pay for the
estimated costs and expenses incurred by the Lender in connection with
the negotiation and preparation of this Agreement and the other
Financing Agreements. Thereafter, the Lender may, in its discretion,
make additional Revolving Advances from time to time at the request of
the Borrower, provided that (i) such Revolving Advances shall be made
no more frequently than once per month and no later than the fifth
Business Day of each calendar month, unless a Level I Payment or Level
II Payment has been received by the Lender, in which case the Borrower
may request a Revolving Advance within ten (10) days of such payment
being received (even if that would result in more than one advance
request in such month), (ii) such request is made in writing at least
five (5) days prior to the date on which such Revolving Advance is to
be funded, and is accompanied by an executed Compliance Certificate,
(iii) such request shall be for Revolving Advances to pay for costs
and expenses incurred in connection with the installation of the COES
Installations in accordance with the Build Out Draw Schedule (it being
expressly acknowledged and agreed that the Borrower shall not request
any Revolving Advance for such costs and expenses in advance of the
month shown for such costs and expenses in the Build Out Draw
Schedule, or in excess of the amounts set forth in the Build Out Draw
Schedule), and (iv) all borrowings after the Funding Date Advances
shall be in multiples of $100,000. There shall not be any recourse to,
nor liability of, the Lender on account of any of the following: (x)
any delay in the Lender's making of, and/or any decline by the Lender
to make, any Revolving Advance, (y) any delay in the proceeds of any
such Revolving Advance constituting collected funds, and (z) any delay
in the receipt, and/or any loss, of funds which constitute a Revolving
Advance, the wire transfer of which was properly initiated by the
Lender in accordance with wire instructions provided to the Lender by
the Borrower.
The Lender may rely on any request for a Revolving Advance which the
Lender, in good faith believes to have been made by a person duly
authorized to act on behalf of the Borrower and may decline to make
any such requested Revolving Advance pending the Lender's being
furnished with such documentation concerning that person's authority
to act as may be satisfactory to the Lender.
(m) Section 2.2.1 is hereby deleted in its entirety, and the following
inserted in its place:
2.2.1 Interest Rate. The outstanding principal amount of the
Revolving Advances shall bear interest at a rate of twenty
percent (20%) per annum. Interest shall be computed on the basis
of a 360-day year over the actual number of days elapsed and
shall be paid to the Lender as set forth in Section 2.3.3.
(n) Section 2.3.1(c) is hereby deleted in its entirety, and the following
inserted in its place:
(c) All amounts deposited in the Blocked Account shall be swept daily
and remitted as follows: (i) prior to the occurrence of an Event
of Default, the receipts shall be distributed first to pay any
amounts then due as set forth in Section 2.3.3 below, if any, and
the remainder shall be remitted to the Borrower's Operating
Account, and (ii) from and after the occurrence of an Event of
Default, 100% of such receipts shall be remitted to the Lender to
be applied in reduction of the Obligations in a manner determined
by the Lender in its sole and exclusive discretion.
(o) Section 2.3.3(b), (c), (d), and (e) are hereby deleted in their
entirety, and the following inserted in their place:
(b) Existing COES Release Payment. Within one (1) year of the Initial
Equity Capital Contribution Date (as defined in the ECCA), the
Borrower shall pay to the Lender $5,143,611.00 representing the
amount required to be paid to the Lender in order to release its
security interest in the Existing COES as set forth in the
Consent Agreement. The Borrower shall make such payment(s) from
its operating cash flow or other sources other than (i) the sale
or liquidation of the Lender's collateral, or (ii) Level I
Payments, Level II Payments, or YAGI Release Fees.
(c) Level I and Level II Payments. An amount equal to each Level I
Payment and Level II Payment, shall be paid to the Lender (i) if
prior to October 1, 2009, as and when the corresponding Level I
Funding or Level II Funding (as those terms are defined in the
ECCA) for each COES Installation becomes due and payable under
the ECCA and/or the GS Next Diesel LLC Agreement, as applicable ,
and (ii) from and after October 1, 2009, on or before the earlier
of (x) as and when the corresponding Level I Funding or Level II
Funding (as those terms are defined in the ECCA) for each COES
Installation becomes due and payable under the ECCA and/or the GS
NextDiesel LLC Agreement, as applicable, or (y) the last day of
the month in which such payment is shown as being received by the
Borrower as set forth in the Build Out Draw Schedule. With
respect to all such payments, the Borrower shall direct GS
NextDiesel to cause all Level I Fundings and Level II Fundings to
be made directly to the Lender by wire transfer in accordance
with the instructions set forth below unless and until all
Obligations have been repaid in full and the ability of the
Borrower to request Revolving Advances hereunder terminated:
Wire Instructions:
Bank Name: Wachovia Bank
Downtown Financial Center
000 Xxxxxx Xxxxxx, XX0000
Xxxxxx Xxxx XX 00000
Bank Telephone# 000-000-0000
Contact Name: Xxxxxx Xxxxxxx
ABA/Routing# 031 201 467
Swift code: XXXXXX00 - for international wires
Account# 2000031475547
Beneficiary: YA Global Investments, L.P.
Notwithstanding the foregoing, the Borrower shall remain
responsible to pay each Level I Payment and the Level II Payment
as and when due above, regardless as to whether CBP makes the
Level I Funding or Level II Funding payments under the ECCA, or
if the Level I Funding or Level II Funding payments are not
sufficient to pay the applicable Level I Payment and/or Level II
Payment in full, then the Borrower shall be required to pay the
shortfall. Further, nothing herein is intended to, nor shall be
construed to, alter or affect the terms of the Consent Agreement
with respect to the release prices for the COES Installations as
set forth therein.
(d) Repayment in Full. The Borrower shall repay all Obligations in
full on the Termination Date.
(e) Application of Payments. Prior to the occurrence of an Event of
Default, all payments hereunder shall be applied first in
reduction of accrued interest, fees, and expenses, and then in
reduction of the principal balance of the Obligations. After the
occurrence of an Event of Default, all payments hereunder shall
be applied in reduction of the Obligations in a manner determined
by the Lender in its sole and exclusive discretion.
(f) Borrowing; Suspension Date. Unless and until the Suspension Date,
but subject to the provisions of this Agreement, including,
without limitation, Section 2.1 hereof, the Borrower may borrow,
repay, and reborrow under the Revolving Credit Facility. From and
after the Suspension Date, the Borrower acknowledges and agrees
that it shall no longer have the ability to request Revolving
Advances, and that all payments made thereafter shall be applied
in permanent reduction of the Obligations and may not be
reborrowed.
(g) YAGI Release Fee.For the avoidance of doubt, the Borrower
acknowledges and agrees that the YAGI Release Fee which is to be
paid upon the transfer of COES Installations (other than the
Existing COES) to GS NextDiesel shall not be applied in reduction
of the Obligations under the Revolving Credit Facility, but will
instead be applied by the Lender in reduction of the obligations
of the Borrower and Guarantors to the Lender under certain
convertible debentures issued by certain of the Guarantors and
held by the Lender in a manner determined by the Lender in its
sole and exclusive discretion.
(h) Convertibility. The Lender and the Borrower agree that all or any
portion of the Obligations under the Revolving Credit Facility
may be converted into common stock of GreenShift at the option of
the Lender, subject to GreenShift's consent (which shall not be
unreasonably withheld), on terms and conditions no less favorable
than the most favorable terms and conditions (as determined by
the Lender) set forth in the existing convertible debentures
issued by certain of the Guarantors to the Lender.
(p) Section 2.5.5 is hereby deleted in its entirety, and the following
inserted in its place:
[Intentionally Deleted]
(q) Section 2.6 is hereby deleted in its entirety, and the following
inserted in its place:
2.6 Termination. This Agreement may be terminated by the Borrower at
any time upon thirty (30) days prior written notice to the Lender,
provided that no termination of this Agreement shall relieve, release,
or discharge the Borrower or Guarantors of their respective duties,
obligations, and covenants under this Agreement and the other
Financing Agreements, or to terminate any Liens or security interests
granted to the Lender, or to otherwise release any Collateral, unless
and until all Obligations have been fully and finally discharged and
paid (in good and collected funds). Notwithstanding the foregoing, all
representations, warranties, covenants, indemnifications, and
agreements which by their express terms survive the termination of
this Agreement and/or the Financing Agreements shall not be affected
by such termination and shall remain in full force and effect.
(r) The following Section is inserted into Article 3 as new Section 3.3.5:
3.3.5 The Lender shall be satisfied, in its sole and exclusive
discretion, that the conditions precedent set forth in Section 5.1 of
the ECCA have been satisfied, or will be satisfied on or before
January 31, 2009.
(s) The references to "GS Ethanol" contained in Section 4.20 are hereby
deleted and "GS CleanTech" inserted in their places.
(t) Section 5.14 is hereby deleted in its entirety, and the following
inserted in its place:
Build Out Draw Schedule. The Borrower shall install the COES
Installations in accordance with, and subject to, the Build Out Draw
Schedule. In addition, the Borrower shall have installed no less than
(a) four (4) COES Installations on or before January 31, 2009, (b)
seven (7) COES Installations on or before June 30, 2009, (c) eleven
(11) COES Installations on or before September 30, 2009, and (d)
twelve (12) COES Installations on or before November 30, 2009.
(u) Section 5.15 is hereby deleted in its entirety, and the following
inserted in its place:
5.15 Compliance with Capex Projections. The actual costs and expenses
of purchasing, assembling, and installing each COES Installation shall
not exceed (a) the amounts set forth for the same in the Build Out
Draw Schedule by more than ten percent (10%) on a cumulative basis
from January 1, 2008 through the last day of the month just ended
prior to the testing date, or (b) the amounts set forth in Exhibit E
to the GS NextDiesel LLC Agreement. This covenant shall be tested
monthly, on the fifth day of each month.
(v) Section 5.16 is hereby deleted in its entirety, and the following
inserted in its place:
[Intentionally Deleted]
(w) The following language is inserted at the beginning of Section 6.9
immediately after the section caption, and before the word "Borrower":
Except for the transactions contemplated in the Consent Agreement,
(x) The following Section is inserted into Article 6 as new Section 6.10:
6.10 Payments to GS NextDiesel or BIG. The Borrower and Guarantors
shall not transfer any assets to, or make any payments to, or on
behalf of, GS NextDiesel or BIG, or any of their Subsidiaries without
the prior written consent of the Lender, other than for payments
expressly permitted by the Consent Agreement and/or the Subordination
Agreement, or with respect to consignment arrangements for feedstock
with BIG, provided that such arrangements are true consignments, where
title to the feedstock remains at all times with the Borrower or
Guarantor who consigns it to BIG, and is upon terms and conditions,
and evidenced by such documentation (including such documentation,
notices, and UCC financing statements as may be required to perfect
the Borrower's or such Guarantor's interest in the consigned feedstock
with respect to third parties) as is acceptable to the Lender in its
sole and exclusive discretion.
(y) The date "December 31, 2008" contained in Section 7.1.16 is hereby
deleted and the date "March 31, 2009" inserted in its place.
(z) The following Sections are inserted into Article 7 as new Sections
7.1.18, 7.1.19, and 7.1.20:
7.1.18 GS NextDiesel Default. The occurrence of any event of default
by GS NextDiesel, the Borrower, and/or any Guarantor under the GS
NextDiesel LLC Agreement, the ECCA, or any other Project Document or
any guaranty of the same; or
7.1.19. Failure to Close on GS NextDiesel LLC Agreement/Project
Documents. The GS NextDiesel LLC Agreement and/or the other Project
Documents shall not have been entered into and made effective (upon
terms and in the forms previously reviewed and accepted by the Lender)
on or before February 5, 2009 or the shareholders of GreenShift shall
fail to approve the transactions evidenced by the Project Documents on
or before July 1, 2009; or
7.1.20 Failure to Fund Under ECCA; Termination of ECCA. If for any
reason, (i) the Initial Equity Capital Contribution Date (as defined
in the ECCA) shall not have occurred on or before January 30, 2009, or
(ii) the Class A Investor and/or the Class B Investor shall fail to
make the Class A Initial Equity Capital Contribution or Class B
Initial Equity Capital Contribution (as each of those terms are
defined in the ECCA) on or before February 5, 2009, or (iii) the ECCA
is terminated.
(aa) Exhibit "A" is hereby deleted in its entirety and the document
attached hereto as Schedule 1 is hereby attached to the Credit
Agreement as the new Exhibit "A" in its place.
(bb) The documents attached hereto as Schedules 2, 3, 4, and 5 are hereby
attached to the Credit Agreement as Xxxxxxxx "X", "X", "X", xxx "X",
xxxxxxxxxxxx.
(xx) Schedule 4.18 is hereby deleted in its entirety, and the document
attached hereto as Schedule 6 is hereby attached to the Credit
Agreement as the new Schedule 4.18 in its place.
3. Consent.
(a) Subject to the satisfaction of the conditions precedent set forth in
Paragraph 1, above, the Lender hereby consents to GreenShift and GS
Adrian entering into the ECCA.
(b) Subject to the satisfaction of the conditions precedent set forth in
Paragraph 1, above, and to (i) the execution of, and the satisfaction
of the conditions to effectiveness set forth in, the Consent
Agreement, and (ii) confirmation by the Lender that all holders of
subordinated bridge loans to the Borrower and/or Guarantors shall have
converted such bridge loans to equity upon terms acceptable to the
Lender in all respects, and provided that the Transactions are
consummated in accordance with the terms of the Transaction Documents,
the Lender hereby consents to the Borrower and the Guarantors entering
into the Transactions. The Borrower and Guarantors further acknowledge
and agree that the foregoing consent is a one-time consent, relates
only to the specific Transactions, and shall not be deemed to
constitute consent to the Borrower and/or Guarantors entering into any
other transactions or contracts, or transferring assets, or creating
additional subsidiaries to the extent that any of the foregoing are
prohibited by the Financing Agreements, or a continuing waiver of, the
provisions of the Credit Agreement and/or the other Financing
Agreements. Further, the Lender's consent to the Borrower and the
Guarantors entering into the Transactions is not, and shall not be
construed as, a waiver of the provisions of the Consent Agreement with
respect to such Transactions, including, without limitation, as to the
payments to the Lender required thereunder in order to release any
COES Installations from the security interests held by the Lender.
4. Acknowledgment of Obligations. The Borrower and the Guarantors hereby
acknowledge and agree that the Borrower and each Guarantor is liable to the
Lender pursuant to the terms and conditions of the Financing Agreements for
the following amounts, all of which constitute Obligations under, and as
defined in, the Credit Agreement:
Due under the Revolving Note as of November 30, 2008:
Principal $10,000,000.00
Interest $ 1,268,182.05
---------------
Total $11,268,182.05
Due under the Convertible Debentures (as defined in the
Security Agreement) as of November 30, 2008:
Principal $28,661,421.00
Interest $ 4,176,380.00
---------------
Total $32,837,801.00
In addition, all interest and late charges accruing from and after
November 30, 2008, and all other fees, costs, expenses, and costs of
collection (including attorneys' fees and expenses) heretofore or
hereafter incurred by the Lender in connection with the protection,
preservation, or enforcement of its rights and remedies under the
Financing Agreements (including the preparation and negotiation of
this letter agreement).
5. Capitalization of Accrued Interest.The Borrower and Guarantors hereby
request, and the Lender hereby agrees, that upon the satisfaction of the
conditions precedent to the effectiveness of this letter agreement set
forth in Paragraph 1, above, the Lender will make a Revolving Advance in
the amount of $750,000.00 to be used to pay all accrued interest due under
the Revolving Note through the date of this letter agreement, with any
amounts not used to pay such accrued interest being treated as prepaid
interest and applied to interest as it accrues until utilized in full.
6. Ratification; Waiver; Representations. The Borrower and the Guarantors
hereby (a) acknowledge, confirm, and agree that, except as specifically
modified herein, the Credit Agreement, the other Financing Agreements and
all other documents related thereto or executed in connection therewith
remain in full force and effect, and confirm and ratify each of the terms
thereof, including, without limitation, the discretionary nature of the
Revolving Credit Facility, (b) acknowledge, confirm and agree that the
Borrower and the Guarantors remain liable for the Obligations without any
offsets, defenses, claims, or counterclaims with respect thereto, and (c)
represent and warrant to the Lender that no Event of Default exists, or
solely with the passage of time or notice, would exist under the Credit
Agreement and/or the other Financing Agreements.
7. Reimbursement of Costs and Expenses. The Borrower shall reimburse the
Lender on demand for any and all unreimbursed costs, expenses, and costs of
collection (including reasonable attorneys' fees and expenses) heretofore
or hereafter incurred by the Lender in connection with the protection,
preservation, and enforcement by the Lender of its rights and remedies
under the Credit Agreement and/or the other Financing Agreements,
including, without limitation, the negotiation and preparation of this
Amendment.
8. Further Assurances. The Borrower and the Guarantors shall, from and after
the execution of this letter agreement, execute and deliver to the Lender
whatever additional documents, instruments, and agreements that the Lender
reasonably may require in order to vest or perfect the Financing Agreements
and the collateral granted therein more securely in the Lender and to
otherwise give effect to the terms and conditions of this letter agreement.
9. Jury Trial Waiver. The Borrower and each Guarantor hereby make the
following waiver knowingly, voluntarily, and intentionally, and understand
that the Lender, in entering into this letter agreement, is relying on such
a waiver: EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY PRESENT
OR FUTURE RIGHT TO A JURY IN ANY TRIAL OF ANY CASE OR CONTROVERSY IN WHICH
ANY OTHER PARTY HERETO BECOMES A PARTY (WHETHER SUCH CASE OR CONTROVERSY IS
INITIATED BY OR AGAINST THE SUCH PARTY OR IN WHICH SUCH PARTY IS JOINED AS
A PARTY LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF, OR IS IN
RESPECT OF, THIS LETTER AGREEMENT, THE OBLIGATIONS, THE FINANCING
AGREEMENTS, OR ANY OTHER RELATIONSHIP BETWEEN THE PARTIES HERETO.
10. Waiver; Release. The Borrower and each Guarantor hereby acknowledges and
agrees that the Borrower and the Guarantors have no offsets, defenses,
claims, or counterclaims against the Lender or the Lender's officers,
directors, employees, attorneys, consultants, vendors, representatives,
predecessors, successors, and assigns with respect to the Obligations, or
otherwise, and that if the Borrower or any Guarantor now has, or ever did
have, any offsets, defenses, claims, or counterclaims against the Lender or
the Lender's officers, directors, employees, attorneys, consultants,
vendors, representatives, predecessors, successors, and assigns, whether
known or unknown, at law or in equity, from the beginning of the world
through this date and through the time of execution of this letter
agreement, all of them are hereby expressly WAIVED, and the Borrower and
each Guarantor hereby RELEASES the Lender and the Lender's officers,
directors, employees, attorneys, consultants, vendors, representatives,
predecessors, successors, and assigns from any liability therefor.
[Remainder of Page Intentionally Left Blank - Signature Pages Follow]
This letter agreement is intended to be executed under seal as of the date
set forth above. If this letter agreement sets forth our understanding, please
execute this letter agreement where indicated below.
YA GLOBAL INVESTMENTS, L.P.
By: Yorkville Advisors, LLC
Its: Investment Manager
Xxxx Xxxxx
By:____________________________ (seal)
Name: Xxxx Xxxxx
Title:Senior Managing Director
ACCEPTED AND AGREED:
BORROWER
XX XXXX (YORKVILLE I), LLC
Xxxxx Xxxxxxxx
By:____________________________ (seal)
Name: Xxxxx Xxxxxxxx
Title: Sole Manager
ACKNOWLEDGED AND AGREED:
---------------------------------
Xxxxx Xxxxxxxx, Individually
VIRIDIS CAPITAL LLC
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Managing Member
CARBONICS CAPITAL CORPORATION
(f/k/a GreenShift Corporation)
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
ECOSYSTEM CORPORATION
(f/k/a GS Energy Corporation)
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
GREENSHIFT CORPORATION
(f/k/a GS CleanTech Corporation)
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
GS CLEANTECH CORPORATION
(f/k/a GS Ethanol Technologies, Inc.)
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title:Chairman
XX XXXX (YORKVILLE I), LLC
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title:Sole Manager
GS CARBON DIOXIDE TECHNOLOGIES, INC.
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title:Chairman
GS GLOBAL BIODIESEL, LLC
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title:Managing Member
GS AGRIFUELS CORPORATION
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
NEXTGEN ACQUISITION, INC.
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
NEXTGEN FUEL INC.
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
SUSTAINABLE SYSTEMS, INC.
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
SUSTAINABLE SYSTEMS LLC
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
GS DESIGN, INC.
(f/k/a Xxxxxxxx Design Service, Inc.)
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
GS RENTALS LLC
(f/k/a Xxxxxxxx Rentals, LLC)
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
GS TECHNOLOGY, LLC
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Managing Member
GS BIG MANAGEMENT, LLC
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Managing Member
XX XXXX (XXXXXX I), LLC
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Managing Member
XXXXXXXXXX & ASSOCIATES INC.
Xxxxx Xxxxxxxx
By_______________________________
Name: Xxxxx Xxxxxxxx
Title: Chairman
1118623.12
