SEVENTH AMENDMENT
[EXECUTION
COPY]
SEVENTH
AMENDMENT
This SEVENTH AMENDMENT dated as of
May 21, 2010 (this “Seventh Amendment”), is between RZB FINANCE LLC (the
“Lender”) and Regional Enterprises, Inc., a Virginia corporation (as successor
by assumption of obligations to Rio Vista Energy Partners L.P., the
“Borrower”).
W I T N E S S E T
H:
WHEREAS, Lender and the
Borrower are parties to the Loan Agreement dated as of July 26, 2007 (as
amended, supplemented or otherwise modified from time to time prior to the date
hereof, the “Loan Agreement”; capitalized terms used herein having the meanings
given thereto in the Loan Agreement unless otherwise defined
herein);
WHEREAS, the Borrower has requested the
Lender to agree to certain amendments to the Loan Agreement; and
WHEREAS, the Lender is willing to agree
to such amendments, subject to the terms and conditions set forth
herein.
NOW, THEREFORE, in consideration of the
foregoing and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
Section 1. Amendments.
The Loan Agreement is hereby amended,
effective on the Effective Date referred to in Section 2 hereof, as
follows:
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(a)
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Subsection
1.1 is amended as follows:
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(i)
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The
definition of “Maturity Date” is amended and restated in its entirety as
follows:
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““Maturity
Date” means May 31, 2014.”
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(ii)
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The
definitions of “Excess Cash Distribution Date” and “Excess Cash Payment”
are deleted.
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(b)
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Subsection
2.4(B) is amended and restated in its entirety as
follows:
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“(B) Repayments. The
outstanding principal amount of the Loans as of May 21, 2010, which is
$3,770,000, shall be repaid by the Borrower on the last Business Day of each
month in the amounts and on the dates as follows:
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Last Business Day of
Each Month
During the Following
Periods
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Monthly Principal
Amount
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May
2010 through and including April 2011
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$50,000
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May
2011 through and including April 2012
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$70,000
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May
2012 through and including April 2013
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$90,000
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May
2013 through and including April 2014
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$100,000
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In
addition, the Borrower shall repay the Loans in a principal amount equal to
$50,000 on the Maturity Date and, without limiting the foregoing, the entire
remaining outstanding principal balance of the Loans shall be paid in full no
later than the Maturity Date.
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(c)
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Subsection
5.1(A) is amended and restated in its entirety as
follows:
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“(A) Year-End
Financials. As soon as available, and in any event not later
than ninety (90) days after the end of each Fiscal Year (but in respect of the
Fiscal Year ended December 31, 2009, no later than September 30, 2010), Borrower
will deliver: (1) the consolidated and consolidating balance
sheets of the Borrower and its Subsidiaries as at the end of such year and the
related consolidated and consolidating statements of income and cash flows for
such Fiscal Year; and (2) a report with respect to the consolidated
financial statements from a firm of independent certified public accountants
selected by Borrower acceptable to Lender, which report shall be unqualified and
shall state that (a) such consolidated financial statements present fairly the
consolidated financial position of the Borrower and its Subsidiaries as at the
dates indicated and the results of their operations and cash flows for the
periods indicated in conformity with GAAP and (b) the examination by such
accountants in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards.”
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(d)
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Subsection
5.3 is amended and restated in its entirety as
follows:
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“5.3 Inspection. Borrower
shall permit Lender and any authorized representatives designated by Lender (at
Borrower’s sole cost and expense) to visit, inspect and make or cause to be made
audits of any of the properties of Borrower or any of its Subsidiaries,
including their financial and accounting records, and in conjunction with such
inspection, to make copies and take extracts therefrom, and to discuss their
affairs, finances and business with their officers and independent public
accountants, during normal business hours, at least once per calendar quarter
and at such other times as often as may be reasonably requested by Lender, provided, that,
unless an Event of Default shall have occurred and be continuing, Lender shall
notify Borrower not later than the Business Day preceding the date of any such
visit, inspection or audit.”
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(e)
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New
Subsection 5.16 is inserted after Subsection 5.15 as
follows:
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“5.16 Weekly Cash Flow
Projections. Borrower shall deliver to Lender on the first Business
Day of each week a cash flow projection for such week, substantially in the form
of Exhibit B hereto (and otherwise in form and substance acceptable to the
Lender in its sole discretion), certified as true and correct by the chief
financial officer of the Borrower.”
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(f)
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Subsection
6.5 is amended and restated in its entirety as
follows:
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“6.5 Restricted Junior
Payments. Directly or indirectly, declare, order, pay, make or
set apart any sum for any Restricted Junior Payment.”
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(g)
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Subsection
7.1(C) is amended and restated in its entirety as
follows:
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“(C) Breach of Certain
Provisions. Failure of any Loan Party to perform or comply with any
term or condition contained in subsections 5.1, 5.3, 5.4, 5.5, 5.6(A), 5.12,
5.14 or 5.16 or Section 6; or”
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(h)
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Subsection
7.1(F) is amended and restated in its entirety as
follows:
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(F) Change in Control; Change in
Management. (i) RVEP ceases to own and control
directly 100% of the capital stock of the Borrower, or Rio Vista GP, LLC ceases
to be the sole general partner of RVEP, or POC ceases to own and control
directly or indirectly, at least 50% of the membership interests of Rio Vista
GP, LLC; provided that, RVEP, the Borrower and their Affiliates are free to
explore change in control transactions and Lender shall use reasonable efforts
to cooperate with such efforts of RVEP and the Borrower (at the sole cost and
expense of the Borrower) so long as such transaction contemplates that the Loans
will be repaid in full and all other Obligations will be repaid and satisfied in
full as a condition precedent to the closing of such transaction;
or
(ii) Any of Xxxxxx Xxxxxxxx,
XxXxxxx Xxxxxx, Xxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxx Xxxxxxxx, Jr., or Xxxxxx X
Xxxxx shall cease for any reason whatsoever, including without limitation, death
or disability (as such disability shall be determined in the sole and absolute
judgment of the Lender) to be, and continuously perform the duties of, Vice
President and General Manager, Sales and Marketing Manager, Terminal Manager,
Controller, Safety Manager, or Transportation Manager, respectively, of the
Borrower or, if such cessation shall occur as a result of death or such
disability, no successor satisfactory to the Lender, in its reasonable
discretion, shall have become and shall have commenced to perform the duties of
Vice President and General Manager, Sales and Marketing Manager, Terminal
Manager, Controller, Safety Manager, or Transportation Manager, as applicable,
of the Borrower within thirty (30) days after such cessation, provided, however,
that if any satisfactory successor shall have been so elected and shall have
commenced performance of such duties within such period, the name of such
successor or successors shall be deemed to have been inserted in place of the
applicable person in this clause (ii); or”
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(i)
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New
Exhibit B to the Loan Agreement is inserted after Exhibit A to the Loan
Agreement, in the form attached hereto as Exhibit
B.
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Section
2. Effectiveness.
This Seventh Amendment shall become
effective on the date (the “Effective Date”) on which Lender shall have
received:
(a) this
Seventh Amendment duly executed by the Borrower and the Lender;
(b) a
Consent, duly executed by RVEP, substantially in the form of Exhibit A
hereto;
(c) an
amendment to the Mortgage, Deed of Trust and Security Agreement dated as of July
26, 2007 (as amended, supplemented or otherwise modified from time to time) duly
executed and delivered by Regional, in form and substance acceptable to Lender
in its sole discretion, and recorded in the appropriate recording
office;
(d) an
endorsement (in form and substance acceptable to the Lender in its sole
discretion) to the title policy issued to the Lender in connection with the
Mortgage;
(e) (i) payment
of all of Lender’s out of pocket costs and expenses; and
(ii) payment
to the Lender of all accrued and unpaid interest and fees owing under the Loan
Agreement immediately prior to giving effect to this Seventh
Amendment;
(f) the
consolidated and consolidating balance sheets and statements of income and cash
flows of the Borrower and its Subsidiaries as at the end of and for the month
ended March 31, 2010, in reasonable detail and certified by the chief financial
officer (or other officer acceptable to Lender in its sole discretion) of the
Borrower to the effect that such information is true and complete and fairly
presents the results of operations and financial condition (in accordance with
GAAP) of the Borrower and its Subsidiaries as at and for the month ended March
31, 2010;
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(g) a
calculation of Net Worth of the Borrower as of April 28, 2010, with supporting
written detail in form and substance acceptable to Lender in its sole
discretion, showing Net Worth plus Subordinated Debt of the Borrower as of such
date (on a consolidated basis) of not less than $2,600,000, certified as true
and correct by the chief financial officer of the Borrower;
(h) a
cash flow projection for the period from the date hereof through and including
the date that is five Business Days after the date hereof, substantially in the
form of Exhibit B hereto (and otherwise in form and substance acceptable to the
Lender in its sole discretion), certified as true and correct by the chief
financial officer of the Borrower;
(i) an
opinion of counsel to the Borrower and RVEP in form and substance acceptable to
the Lender in its sole discretion; and
(j) such
corporate, partnership or other authorization documents of RVEP and the
Borrower, as required by Lender.
Section
6. Effect of Amendment;
Ratification; Representations; etc.
(a) On
and after the date hereof, when counterparts of this Seventh Amendment shall
have been executed by all parties hereto, this Seventh Amendment shall be
a part of the Loan Agreement, all references to the Loan Agreement in the
Loan Agreement and the other Loan Documents shall be deemed to refer to the Loan
Agreement as amended by this Seventh Amendment, and the term “this Agreement”,
and the words “hereof”, “herein”, “hereunder” and words of similar import, as
used in the Loan Agreement, shall mean the Loan Agreement as amended
hereby.
(b) Except
as expressly set forth herein, this Seventh Amendment shall not constitute an
amendment, waiver or consent with respect to any provision of the Loan
Agreement, as amended hereby, and the Loan Agreement, as amended hereby, is
hereby ratified, approved and confirmed in all respects.
(c) In
order to induce Lender to enter into this Seventh Amendment, the Borrower
represents and warrants to Lender that before and after giving effect to the
execution and delivery of this Seventh Amendment:
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(i)
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the
representations and warranties of the Borrower set forth in the Loan
Agreement and in the other Loan Documents are true and correct as if made
on the date hereof; and
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(ii)
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no
Default or Event of Default has occurred and is
continuing.
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(d) The
Borrower hereby represents and warrants to Lender that:
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(i) as
of the date hereof, the principal amount outstanding of the Loan is
$3,770,000;
(ii) interest
and fees have accrued thereon as provided in the Loan Agreement;
and
(iii) the
obligation of the Borrower to repay the Loan and the other Obligations, together
with all interest and fees accrued thereon, is absolute and unconditional, and
there exists no right of set off or recoupment, counterclaim or defense of any
nature whatsoever to the payment of the Obligations.
(e) The
Borrower hereby agrees and acknowledges that in accordance with Section 1(g) of
the Third Amendment to Loan Agreement dated as of January 27, 2009 between the
Borrower and the Lender, notwithstanding anything to the contrary contained in
the Loan Agreement or any of the other Loan Documents, no Loans shall be LIBOR
Loans and Loans shall not be converted into LIBOR Loans under any
circumstances.
(f) This
Seventh Amendment is a Loan Document.
Section 7. Release; Covenant not to
Xxx.
(a)EACH OF THE BORROWER AND RVEP (IN
ITS OWN RIGHT AND ON BEHALF OF ITS OFFICERS, EMPLOYEES, INDEPENDENT CONTRACTORS,
ATTORNEYS AND AGENTS) HEREBY REPRESENTS, ACKNOWLEDGES AND AGREES THAT IT DOES
NOT HAVE ANY DEFENSES, COUNTERCLAIMS, OFFSETS, CROSS-COMPLAINTS, CLAIMS OR
DEMANDS OF ANY KIND OR NATURE WHATSOEVER INCLUDING, WITHOUT LIMITATION, ANY SUCH
DEFENSES, COUNTERCLAIMS, OFFSETS, CROSS-COMPLAINTS, CLAIMS OR DEMANDS THAT CAN
BE ASSERTED (I) TO REDUCE OR ELIMINATE ALL OR ANY PART OF THE OBLIGATIONS OR
(II) TO SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM THE LENDER
OR ANY OF ITS PREDECESSORS, SUCCESSORS AND ASSIGNS, OFFICERS, EMPLOYEES,
INDEPENDENT CONTRACTORS, ATTORNEYS AND AGENTS (COLLECTIVELY WITH THE LENDER, THE
“RELEASED PARTIES”). EACH OF THE BORROWER AND RVEP HEREBY
UNCONDITIONALLY AND IRREVOCABLY, VOLUNTARILY AND KNOWINGLY WAIVES, REMISES,
ACQUITS, AND FULLY AND FOREVER RELEASES AND DISCHARGES THE RELEASED
PARTIES FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES,
COSTS, OR EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR
UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT
LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS
SEVENTH AMENDMENT IS EXECUTED, WHICH THE BORROWER OR RVEP MAY NOW OR HEREAFTER
HAVE AGAINST ANY OF THE RELEASED PARTIES (COLLECTIVELY, THE “RELEASED CLAIMS”)
AND IRRESPECTIVE OF WHETHER ANY SUCH RELEASED CLAIMS ARISE OUT OF CONTRACT,
TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, INCLUDING, WITHOUT
LIMITATION, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE LOAN AGREEMENT OR
OTHER LOAN DOCUMENTS, AND NEGOTIATION AND EXECUTION OF THIS SEVENTH
AMENDMENT.
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(b) EACH
OF THE BORROWER AND RVEP AGREES NEVER TO COMMENCE, VOLUNTARILY AID IN ANY WAY,
FOMENT, PROSECUTE OR CAUSE TO BE COMMENCED OR PROSECUTED AGAINST ANY OF THE
RELEASED PARTIES ANY ACTION OR OTHER PROCEEDING BASED UPON ANY OF THE RELEASED
CLAIMS WHICH MAY HAVE ARISEN AT ANY TIME ON OR PRIOR TO THE DATE OF THIS SEVENTH
AMENDMENT AND WERE IN ANY MANNER RELATED TO ANY OF THE LOAN
DOCUMENTS.
Section 8. New York
Law.
This Seventh Amendment shall be
construed in accordance with and governed by the laws of the State of New York,
without regard to New York conflicts of laws principles.
Section 9. Severability.
If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible, and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
Section 10. Counterparts.
This Seventh Amendment may be executed
by the parties hereto individually or in any combination, in one or more
counterparts, each of which shall be an original and all of which shall together
constitute one and the same agreement. Signatures of the parties may
appear on separate counterparts.
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IN WITNESS WHEREOF, the parties hereto
have caused this Seventh Amendment to be duly executed as of the day and year
first above written.
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REGIONAL
ENTERPRISES, INC.
By:___________________
Name:
Xxx Xxxxxxxx
Title:
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RZB
FINANCE LLC
By:___________________
Name:
Title:
By: ___________________
Name:
Title:
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