SECOND MODIFICATION TO CREDIT AGREEMENT

WITH MODIFICATIONS TO THE

NON REVOLVING LINE OF CREDIT PROMISSORY NOTE

THIS SECOND MODIFICATION AGREEMENT (this "Agreement") is entered into as of
November 30, 2008 by and between COMERICA BANK, a Texas banking corporation
("Lender"), and RENEGY HOLDINGS, INC., a Delaware corporation (the "Borrower").
Robert Merrill Worsley ("RMW"), Christi Marie Worsley ("CMW"), The Robert
Merrill Worsley and Christi Marie Worsley Family Revocable Trust, dated July 28,
1998 ("Trust"), NZ Legacy, LLC, an Arizona limited liability company ("NZ
Legacy"), and New Mexico & Arizona Land Company, LLC, an Arizona limited
liability company ("NMAL") (RMW, CMW, Trust, NZ Legacy and NMAL are also
referred to individually and collectively as the "Guarantor" and together with
Borrower the "Credit Parties") are joining in the execution and delivery of this
Agreement to evidence its acknowledgment of, consent to, and agreement with, the
terms and conditions of this Agreement and the representations, warranties and
obligations of Guarantor under this Agreement.

PRELIMINARY STATEMENTS

A. Lender has extended to Borrower a non revolving line of credit facility in
the principal amount not to exceed $6,200,000.00 (the "NRLC"), pursuant to the
terms and conditions set forth in the Credit Agreement dated March 28, 2008, as
modified by that First Modification to Credit Agreement with Modifications to
the Cash Collateral Account Agreement dated November 14, 2008 between Borrower
and Lender (collectively the "Credit Agreement"), and secured by the deeds of
trust set forth on Schedule A attached hereto and incorporated by this
reference, the Credit Documents, Note, Cash Collateral Account Agreement, and
other documents related to the transactions contemplated therein (collectively
the "Loan Documents"). Each Guarantor has guaranteed certain obligations of
Borrower with respect to the Loan Documents pursuant to the guaranty executed by
each Guarantor in favor and for the benefit of Lender as and to the extent set
forth in the Guaranty. The term "Loan Documents" shall hereafter include such
Guaranty (as defined in the Credit Agreement). Capitalized terms not otherwise
defined herein shall have the meaning ascribed to such capitalized terms in the
Credit Agreement.

B. The Credit Parties have requested that Lender agree to increase the Maximum
NRLC Loan Amount under the Credit Agreement from $6,200,000 to $6,500,000.

C. Lender is willing to agree to such request on the terms and conditions set
forth in this Agreement.

 

 

AGREEMENT

For good and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the parties agree as follows:

The Credit Agreement is hereby modified as follows:

 A. Recital A(1) is hereby restated in its entirety as follows:

    "(1) A non revolving line of credit facility (the "NRLC") in the principal
    amount of not to exceed SIX MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
    ($6,500,000.00) for the purpose of funding costs over-run associated with
    the Snowflake White Mountain Power Plant, Borrower's working capital and
    other general corporate uses."

    Section 1.1, the definition of "Maximum NRLC Loan Amount" is deleted and
    replaced in its entirety with the following:

"Maximum NRLC Loan Amount" means Six Million Five Hundred Thousand and NO/100
Dollars ($6,500,000.00)."

The Non Revolving Line of Credit Promissory Note is hereby modified as follows:

A. By deleting all references to "$6,200,000" and replacing same with
"$6,500,000".

B. By deleting all references to "Six Million Two Hundred Thousand" and
replacing same with "Six Million Five Hundred Thousand".

Conditions Precedent

. Lender's covenants and obligations under this Agreement and the effectiveness
of this Agreement are expressly conditioned upon:

Execution and delivery of this Agreement by the Credit Parties;

Credit Parties execution and delivery of such other documents and instruments as
Lender may require in connection with the transactions contemplated hereby,
including, without limitation, certificates and resolutions, incumbency
certificates, modifications of mortgages, deeds of trust, and other security
instruments.

Each representation and warranty set forth in this Agreement and in the Loan
Documents shall be true and correct as of the date of execution and delivery of
this Agreement by the Borrower.

Borrower's delivery of the $3,000.00 fee to Lender in consideration for Lender
increasing the Maximum NRLC Loan Amount.

No Event of Default shall have occurred and be continuing under the Loan
Documents as of the date hereof.

Representations and Warranties of Borrower and Guarantors

. Each Credit Party represents and warrants to Lender as of the date of this
Agreement as follows: (a) Each entity of Borrower is duly organized, validly
existing and in good standing under the laws of its state of formation with all
power and authority necessary to own, lease and operate Borrower's properties
and carry on its business as now conducted and to execute, deliver and perform
this Agreement; (b) all necessary action has been taken on its part to authorize
the execution, delivery and performance of this Agreement and this Agreement has
been duly executed and delivered by each Credit Party; (c) there are no suits,
actions, proceedings or investigations pending or, to the best of each Credit
Party's knowledge, threatened against or involving it before any court,
arbitrator or administrative or governmental body which might reasonably result
in a material adverse change in its contemplated business, condition, worth or
operations; (d) the authorization, execution, delivery and performance of this
Agreement will not result in any breach or default under any other document,
instrument or agreement to which any Credit Party is a party or by which it is
subject or bound; (e) the authorization, execution, delivery and performance of
this Agreement will not violate any applicable law, statute, regulation, rule,
ordinance, code or order; (f) this Agreement and each of the Loan Documents
constitutes the legal, valid and binding obligation of each Credit Party,
enforceable against each Credit Party in accordance with its terms; (g) each
lien and security interest on the Collateral continues to be duly and properly
perfected and constitutes a first priority lien; (h) no consent, license,
permit, approval or authorization of any person, entity or governmental
authority is required in connection with its execution, delivery and performance
of this Agreement; (i) the representations and warranties made by each Credit
Party in each of the Credit Documents to which it is a party are true and
correct as of the date of the execution and delivery of this Agreement by such
Credit Party. All representations and warranties of each of Borrower and
Guarantors made in this Agreement shall survive the execution and delivery of
this Agreement.

Releases. In further consideration of the Lender's execution of this Agreement,
each Credit Party hereby releases Lender and Lender's respective participants,
affiliates, officers, shareholders, employees, directors, agents, advisors and
attorneys (collectively, the "Releasees") from any and all claims, demands,
liabilities, responsibilities, disputes, causes of action (whether at law or
equity) and obligations of every nature whatsoever, whether liquidated or
unliquidated, known or unknown, matured or unmatured, fixed or contingent that
such Credit Party may have against Releasees or any of them which arise or
relate to this Agreement, the obligations, any Collateral, any Loan Document,
any documents, agreements, dealings or other matters in connection with any of
the Loan Documents and any third parties liable in whole or in part for any of
the obligations under the Loan Documents or this Agreement, in each case to the
extent arising (a) on or prior to the date hereof or (b) out of, or relating to,
actions, dealings or matters occurring on or prior to the date hereof
(including, without limitation, any actions or inactions which Releasees or any
of them may have taken prior to the date hereof).

Indemnity. Each Credit Party, jointly and severally, shall indemnify, defend and
hold the Releasees harmless for, from and against any and all claims, causes of
action, losses, damages, awards, settlements, penalties, judgments, costs and
expenses (including, without limitation, reasonable attorneys' fees)
(collectively, "Losses") (excluding Losses suffered by a Releasee directly
arising out of such Releasee's gross negligence or willful misconduct) with
respect to, or resulting from, or in connection with this Agreement, the Loan,
the Loan Documents or the transactions contemplated thereby. This Section 4
shall survive the execution and delivery of this Agreement.

Amendments. No termination or waiver of any provision of this Agreement, or the
consent to any departure by the Credit Parties therefrom, shall in any way be
effective without the written concurrence of Lender. Any waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which it was given. No notice or demand upon the Borrower or any Guarantor in
any case shall entitle any Credit Party to any further notice or demand in
similar or other circumstances. The Lender's failure at any time or times
hereafter to require strict performance by the Credit Parties of any provision
or term of this Agreement shall not waive, effect or diminish any rights of
Lender thereafter to demand strict performance in compliance herewith. Any
suspension or waiver by Lender of a default, or forbearance with respect
thereto, pursuant to this Agreement or with respect to any Event of Default
under the Loan Documents shall not, except as may be expressly set forth herein,
suspend, waive, effect or be a forbearance with respect to, any other default or
event of default, whether the same is prior or subsequent thereto and whether of
the same or of a different kind or character. None of the undertakings,
agreements, warranties, covenants and representations of the Lender contained in
this Agreement shall waive, effect or diminish the rights of the Lender under
this Agreement or any other Loan Document. None of the undertakings, agreements,
warranties, covenants and representations of the Credit Parties contained in
this Agreement or any other Loan Document and no default or event of default
under this Agreement or any other Loan Document shall be deemed to have been
suspended or waived by the Lender unless such suspension or waiver is (a) in a
subsequent writing signed by the Lender and (b) delivered to the Borrower.

Relationship Between the Parties

. The relationship of the Lender on the one hand, and the Credit Parties, and
each of them, on the other hand has been and shall continue to be, at all times,
that of creditor and debtor. Nothing contained in this Agreement, any
instrument, document or agreement delivered in connection therewith or in the
Credit Agreement or any of the other Loan Documents shall be deemed or construed
to create a fiduciary relationship among the parties.

Notices

. All communications and notices to the Lender hereunder shall be given as
provided in the Loan Documents.

No Assignment

. This Agreement shall not be assignable by the Borrower or any other Credit
Party without the written consent of the Lender. The Lender may assign to one or
more persons all or any part of, or any participation in, the Lender's rights
and benefits hereunder.

TIME OF THE ESSENCE

. TIME IS STRICTLY OF THE ESSENCE OF THIS AGREEMENT AND FULL AND COMPLETE
PERFORMANCE OF EACH AND EVERY PROVISION HEREOF.

Miscellaneous. Each of the Credit Parties agrees to sign such other and further
documents, and to take such other actions, as may be reasonably appropriate to
carry out the intentions expressed in this Agreement, including, without
limitation, documentation in respect of the reaffirmation and confirmation of
liens, and the priority of such liens, on the collateral for the NRLC. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original. This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and permitted assigns, including,
without limitation, any United States trustee, any debtor-in-possession or any
trustee appointed from a private panel. This Agreement, the Loan Documents and
any other instruments referred to herein, constitute the entire agreement among
the parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, both written and oral, of the parties or any of
them with respect to the subject matter hereof, if any. This Agreement shall be
governed by the laws of the State of Arizona, without giving effect to its
principles of conflicts of law. EACH CREDIT PARTY AND LENDER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT THEY MAY HAVE TO A TRIAL BY JURY
WITH RESPECT TO ANY AND ALL ISSUES PRESENTED IN ANY ACTION, PROCEEDING, CLAIM OR
COUNTERCLAIM BROUGHT BY ANY OF THE PARTIES HERETO AGAINST ANY OF THE OTHERS OR
THEIR SUCCESSORS WITH RESPECT TO ANY MATTER ARISING OUT OF OR IN CONNECTION WITH
THIS AGREEMENT OR ANY DOCUMENT CONTEMPLATED HEREIN OR RELATED HERETO. THIS
WAIVER BY THE PARTIES HERETO OF ANY RIGHT EITHER MAY HAVE TO A TRIAL BY JURY HAS
BEEN NEGOTIATED AND IS AN ESSENTIAL ASPECT OF THEIR BARGAIN. FURTHERMORE, EACH
OF THE CREDIT PARTIES AND LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE THE RIGHT THEY MAY HAVE TO SEEK PUNITIVE, CONSEQUENTIAL, SPECIAL AND
INDIRECT DAMAGES FROM THE OTHER PARTY AND ANY OF THE AFFILIATES, OFFICERS,
DIRECTORS OR EMPLOYEES OF THE OTHER PARTY OR ANY OF THE OTHER PARTY'S SUCCESSORS
WITH RESPECT TO ANY AND ALL ISSUES PRESENTED IN ANY ACTION, PROCEEDING, CLAIM OR
COUNTERCLAIM BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY OR ANY OF THE
AFFILIATES, OFFICERS, DIRECTORS OR EMPLOYEES OF ANY OTHER PARTY OR ANY OF THEIR
SUCCESSORS WITH RESPECT TO ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT OR ANY DOCUMENT CONTEMPLATED HEREIN OR RELATED HERETO. THE WAIVER BY
THE CREDIT PARTIES OF ANY RIGHT THEY MAY HAVE TO SEEK PUNITIVE, CONSEQUENTIAL,
SPECIAL AND INDIRECT DAMAGES HAS BEEN NEGOTIATED BY THE PARTIES HERETO AND IS AN
ESSENTIAL ASPECT OF THEIR BARGAIN.

Ratification

. To the extent that the terms of this Agreement and are in conflict with the
Loan Documents, this Agreement shall govern. All other provisions of the Loan
Documents shall remain in full force and effect and are incorporated herein by
reference.

[Signature Pages Follow]

IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date set forth above.

BORROWER:

 

RENEGY HOLDINGS, INC.

, a Delaware corporation

By: /s/ Robert M. Worsley

Name: Robert M. Worsley

Title: Chief Executive Officer

 

 

LENDER:

 

COMERICA BANK

, a Texas banking corporation

 

By: /s/ Matthew E. James

Name: Matthew E. James

Title: Corporate Banking Officer