AMENDMENT TO LOAN AGREEMENT $7,500,000 REVOLVING CREDIT LOAN

AMENDMENT TO LOAN AGREEMENT $7,500,000 REVOLVING CREDIT LOAN

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Exhibit 10.2

$7,500,000 REVOLVING CREDIT LOAN

This Amendment (the “Amendment”) is entered into this 7th day of April, 2010, by and between DEER VALLEY FINANCIAL CORP., a Florida corporation, having its principal place of business at 000 Xxxxxxxx Xxxxxx, Xxxx, Xxxxxxx 00000, DEER VALLEY CORPORATION, a Florida corporation, having a mailing address of 0000 Xxxx Xx. XXX Xxxxxxxxx, Xxxxx 000, Xxxxx, Xxxxxxx 00000, and DEER VALLEY HOMEBUILDERS, INC., an Alabama corporation authorized to do business in the State of Florida, having its principal place of business at 000 Xxxxxxxx Xxxxxx, Xxxx, Xxxxxxx 00000, jointly and severally (collectively the “Borrowers”) and FIFTH THIRD BANK, a Michigan banking corporation, having a mailing address of 000 Xxxx Xxxxxxx Xxxxxxxxx, Xxxxx 0000, Xxxxx, Xxxxxxx 00000 (the “Bank”), and amends and modifies that certain Revolving Credit Loan and Security Agreement dated October 14, 2009 (the “Loan Agreement”) as follows:

1. Terms. All of the capitalized terms in this Amendment shall have the meanings as defined in the Loan Agreement.

2. Financial Covenant. The Financial Covenant set forth in Section 6.10 (a) of the Loan Agreement is deleted in its entirety and the following Section 6.10 (a) is substituted in its place and stead:

“(a) Debt Service Coverage Ratio. Maintain a global Debt Service Coverage Ratio (Excluding Cap Ex) of not less than 1.25 to 1.00, measured on a rolling 4-quarter basis, commencing March 31, 2010. As used herein ‘Debt Service Coverage Ratio (Excluding Cap Ex)’ means the ratio of: (1) the sum of Borrowers’ consolidated net income before taxes, depreciation, amortization and interest expense, less distributions, dividends and other extraordinary/non-recurring income plus goodwill impairment charges to (2) the sum of Borrowers’ interest expense, and all required principal payments including capital leases (excluding principal due at maturity).”

The Borrowing Base Certificate as defined in Section 1.2 of the Loan Agreement and attached thereto as Exhibit “A” is hereby revised to comply with this covenant modification by a revised Borrowing Base Certificate attached hereto as Exhibit “A”.

3. Warranties. Borrower hereby affirms and warrants that all of the warranties made in the Note, Loan Agreement and the other Loan Documents, and any other documents or instruments recited herein or executed with respect thereto directly or indirectly, are true and correct as of the date hereof and that Borrower is not in default of any of the foregoing nor aware of any default with respect thereto, and that Borrower has no defenses or rights of offset with respect to any indebtedness to the Bank. Borrower hereby releases and indemnifies the Bank from any cause of action against it existing as of the date of execution hereof. The rights and defenses being waived, released and indemnified hereunder include without limitation any claim or defense

based on the Bank having charged or collected interest at a rate greater than that allowed to be contracted for by applicable law as changed from time to time, provided, however, in no event shall such waiver and release be deemed to change or modify the terms of the Loan Documents which provide that sums paid or received in excess of the maximum rate of interest allowed to be contracted for by applicable law, as changed from time to time, reduce the principal sum due, said provision to be in full force and effect.

4. Ratification. Except as modified by this Amendment, Borrower hereby ratifies and confirms the continued validity and viability of all terms, conditions and obligations set forth in the Loan Documents and all other instruments as modified by this Amendment.

5. Severability. Whenever possible, each provision of this Amendment shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision hereof shall be prohibited or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity only, without invalidating the remainder of such provision or of the remaining provisions of this Amendment.

6. Florida Contract. This Amendment shall be deemed a Florida contract and shall be construed according to the laws of the State of Florida, regardless of whether this Amendment is executed by certain of the parties in other states.

7. Binding Effect. This Amendment shall bind the successors and assigns to the parties hereto and constitutes the entire understanding of the parties, which may not be modified except in writing.

8. Other Terms. Except as specifically modified and amended by the terms set forth in this Amendment, all of the other terms, covenants, obligations and conditions of the Loan Agreement shall remain in full force and effect.

Entered into as of the day and year first above written.


WITNESSES:	“BORROWER”

	DEER VALLEY FINANCIAL CORP.,
	a Florida corporation

	By:	/s/ Xxxx Xxxxx
Signature of Witness		Xxxx Xxxxx, as its Vice President

Print or type name of Witness
		(CORPORATE SEAL)
Signature of Witness

Print or type name of Witness


	DEER VALLEY CORPORATION,
	a Florida corporation

	By:	/s/ Xxxx Xxxxxx Xxxxxx
Signature of Witness		Xxxx Xxxxxx Xxxxxx, as its
		Chief Financial Officer and Secretary
Print or type name of Witness
		(CORPORATE SEAL)
Signature of Witness

Print or type name of Witness
	DEER VALLEY HOMEBUILDERS, INC.,
	an Alabama corporation

	By:	/s/ Xxxx Xxxxx
Signature of Witness		Xxxx Xxxxx, as its President

Print or type name of Witness
		(CORPORATE SEAL)
Signature of Witness

Print or type name of Witness
	“BANK”

	FIFTH THIRD BANK,
	an Ohio banking corporation

	By:	/s/ Xxxxxxx X. Xxxxxxxx
Signature of Witness		Xxxxxxx X. Xxxxxxxx, as its Vice President

Print or type name of Witness		(CORPORATE SEAL)

Signature of Witness

Print or type name of Witness

STATE OF ALABAMA

COUNTY OF

The foregoing instrument was acknowledged before me this day of , 2010, by Xxxx Xxxxx, as President of DEER VALLEY FINANCIAL CORP., a Florida corporation, on behalf of the corporation.


Personally known
Florida Driver’s License						Notary Public
Other Identification Produced

						Print or type name of Notary

						(SEAL)

STATE OF ALABAMA

COUNTY OF

The foregoing instrument was acknowledged before me this day of , 2010, by Xxxx Xxxxxx Xxxxxx, as Chief Financial Officer and Secretary of DEER VALLEY CORPORATION, a Florida corporation, on behalf of the corporation.


Personally known
Florida Driver’s License						Notary Public
Other Identification Produced

						Print or type name of Notary

						(SEAL)

STATE OF ALABAMA

COUNTY OF

The foregoing instrument was acknowledged before me this day of , 2010, by Xxxx Xxxxx, as President of DEER VALLEY HOMEBUILDERS, INC., an Alabama corporation, on behalf of the corporation.


Personally known
Florida Driver’s License						Notary Public
Other Identification Produced

						Print or type name of Notary

						(SEAL)

STATE OF FLORIDA

COUNTY OF HILLSBOROUGH

The foregoing instrument was acknowledged before me this day of , 2010, by Xxxxxxx X. Xxxxxxxx, as Vice President of FIFTH THIRD BANK, an Ohio banking corporation, on behalf of the Bank.


Personally known
Florida Driver’s License						Notary Public
Other Identification Produced

						Print or type name of Notary

						(SEAL)

ATTACHMENTS:

Exhibit “A” - Borrowing Base Certificate

EXHIBIT “A”

BORROWING BASE CERTIFICATE

$7,500,000.00 RLOC

FIFTH THIRD BANK

000 Xxxx Xxxxxxx Xxxx., Xxxxx 0000

Xxxxx, Xxxxxxx 00000

Pursuant to the Loan and Security Agreement, Borrower hereby certifies, as of the above date, the following:


(A)	DVFC Aggregate Amount of Accounts Receivable Aged less than 360 days		$

(B)	Less: Ineligibles
	Accounts with Account Debtors having in excess of 20% of total Eligible A/R	$
	Other (if applicable)	$
	Total Ineligible	$

(C)	Net Amount of 360 Day Eligible Accounts Receivable (A) Less (B)		$

(D)	75% of (C)		$

(E)	DVFC Aggregate Amount of Accounts Receivable Aged greater than 360 days, but less than 540 days		$

(F)	Less: Ineligibles
	Accounts with 25% aged over 540 days	$
	Accounts with Account Debtors having in excess of 20% of total Eligible A/R	$
	Other (if applicable)	$
	Total Ineligible	$

(G)	Net Amount of 540 Day Eligible Accounts Receivable (E) Less (F)		$

(H)	50% of (G)		$

(I)	CURRENT BORROWING BASE: (D) Plus (H)		$

The undersigned hereby certifies, represents, and warrants to FIFTH THIRD BANK (the “Bank”) as follows:

1. All the representations and warranties contained in the Loan and Security Agreement or in any other related loan document are true and correct on the date hereof.

2. No event of default has occurred, or would result from the advance made in connection herewith, that constitutes an Event of Default under the Loan and Security Agreement or any other related document.

3. The description of Eligible Accounts Receivable and the values assigned thereto are true and correct in all material respects (see attached accounts receivable aging). We are legal owners the accounts receivable as identified above.

4. The aggregate unpaid principal balance of the Loan does not exceed the lesser of the $7,500,000.00 Commitment or Borrowing Base.

This shall also certify that, for the month ending , 20 , the Borrower was in compliance with the following covenants contained in the Loan and Security Agreement between Bank and Borrower dated October 14, 2009, as amended , 2010.



By:		By:

Its:		Its:

Date:	, 20	Date:	, 20

The aggregate unpaid principal owed to Bank is:

Not to not exceed maximum loan limit or (I) above

Availability (I) Less (J),

Not to exceed the maximum loan limit of $7,500,000.00