EXHIBIT 10.1
ASSUMPTION AGREEMENT
     THIS ASSUMPTION AGREEMENT (this “Agreement”), dated as of October 1, 2007,
is entered into by and among Renegy Holdings, Inc., a Delaware Corporation
(“Holdings”), Catalytica Energy Systems, Inc., a Delaware corporation
(“Catalytica”), Snowflake Acquisition Corporation, a Delaware corporation
(“Merger Sub”), Renegy, LLC, an Arizona limited liability company (“Renegy”),
Renegy Trucking, LLC, an Arizona limited liability company (“Renegy Trucking”),
Snowflake White Mountain Power, LLC, an Arizona limited liability company
(“Snowflake” and, together with Renegy and Renegy Trucking, the “Companies”),
Robert M. Worsley (“R. Worsley”), Christi M. Worsley (“C. Worsley”) and the
Robert M. Worsley and Christi M. Worsley Revocable Trust (collectively with R.
Worsley and C. Worsley, “Worsley”).
RECITALS
     WHEREAS, Holdings, Catalytica, Merger Sub, the Companies, and Worsley, have
entered into that certain Contribution and Merger Agreement dated as of May 8,
2007, as amended (the “Merger Agreement”), pursuant to which Catalytica and the
Companies shall combine and become wholly owned subsidiaries of Holdings upon
the terms and subject to the conditions set forth therein (the “Merger and
Contribution”); and
     WHEREAS, the Merger Agreement contemplates that this Agreement be executed
and delivered at the Closing of the Merger and Contribution.
     NOW, THEREFORE, in order to induce Worsley and the Companies to enter into
the Merger Agreement and the other documents to be executed and delivered by
Worsley and the Companies thereunder and to consummate the transactions
contemplated thereby, and for other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
     1. Definitions. All capitalized terms used but not defined herein shall
have the respective meanings ascribed to such terms in the Merger Agreement.
     2. Assumption. Subject to the terms and conditions of the Merger Agreement,
as of the Effective Time, Holdings hereby:
          (a) accepts the assignment of rights and hereby assumes and agrees to
perform and fulfill the obligations of Holdings post-Closing that are set forth
in the Merger Agreement, including, without limitation, those rights and
obligations set forth in Section 2.10 of the Merger Agreement, the Employment
Agreements and the indemnification obligations set forth under Article XI of the
Merger Agreement; and
          (b) assumes all of the rights and executory obligations of Catalytica
under the Zack Employment Agreement.
     3. Effect on Merger Agreement. This Agreement is made subject to and with
the benefit of the respective representations, warranties, covenants, terms,
conditions, limitations and other

 

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provisions of the Merger Agreement, which are incorporated herein by reference.
In the event of any conflict or other inconsistency between this Agreement and
the Merger Agreement, the Merger Agreement shall control.
     4. Third-Party Beneficiaries. This Agreement shall not confer any rights on
any person not a party hereto.
     5. Further Assurances. Holdings, Catalytica, Worsley and the Companies
shall execute and deliver from time to time hereafter, upon written request, all
such further documents and instruments and shall do and perform all such acts as
may be reasonably necessary to give full effect to the intent of this Agreement.
     6. Binding Effect. This Agreement shall be binding upon, inure to the
benefit of, and be enforceable by and against the respective successors and
permitted assigns of the parties hereto.
     7. Governing Law. This Agreement shall be governed by and construed under
the laws of the State of Delaware, without regard to any jurisdiction’s
conflicts of law provisions.
     8. Effective Date. This Agreement shall become effective only upon the
Effective Time.
     9. Severability. If any one or more provisions contained in this Agreement,
or the application of such provision to any person or circumstance, shall, for
any reason, be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
     10. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[Remainder of page intentionally left blank.]

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

                  RENEGY HOLDINGS, INC.    
 
           
 
  By:   /s/ Robert W. Zack    
 
           
 
  Name:   Robert W. Zack    
 
  Title:   CEO    
 
                CATALYTICA ENERGY SYSTEMS, INC.    
 
           
 
  By:   /s/ Robert W. Zack    
 
           
 
  Name:   Robert W. Zack    
 
  Title:   CEO    
 
                SNOWFLAKE ACQUISITION CORPORATION    
 
           
 
  By:   /s/ Robert W. Zack    
 
           
 
  Name:   Robert W. Zack    
 
  Title:   CEO    
 
                RENEGY, LLC    
 
           
 
  By:   /s/ Robert M. Worsley    
 
           
 
  Name:   Robert M. Worsley    
 
  Title:   Manager    
 
                RENEGY TRUCKING, LLC    
 
           
 
  By:   /s/ Robert M. Worsley    
 
           
 
  Name:   Robert M. Worsley    
 
  Title:   Manager    

[Signature Page to Assumption Agreement]

 

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                  SNOWFLAKE WHITE MOUNTAIN POWER, LLC    
 
           
 
  By:   /s/ Robert M. Worsley    
 
           
 
  Name:   Robert M. Worsley    
 
  Title:   Manager    
 
                ROBERT M. WORSLEY    
 
                /s/ Robert M. Worsley              
 
                CHRISTI M. WORSLEY
   
 
                /s/ Christi M. Worsley              
 
                ROBERT M. WORSLEY AND CHIRSTI M. WORSLEY REVOCABLE TRUST    
 
           
 
  By:   /s/ Robert M. Worsley    
 
           
 
  Name:   Robert M. Worsley    
 
  Title:   Trustee    
 
           
 
  By:   /s/ Christi M. Worsley    
 
           
 
  Name:   Christi M .Worsley    
 
  Title:   Trustee    

[Signature Page to Assumption Agreement]