Document:

exhibit10a.htm

	
  

	
June __, 2010

YA Corn Oil Systems, LLC

c/o Yorkville Advisors, LLC

101 Hudson Street, Suite 3700

Jersey City, New Jersey 07302

Attn:           Troy J. Rillo, Manager

 

	
  

	
Re:

	
AGREEMENT TO ACCEPT COLLATERAL IN

	
  

	
SATISFACTION OF OBLIGATION

 

Dear Mr. Rillo:

 

Reference is made to (i) that certain Secured Demand Note dated June ___, 2010 (the “Note”) made by GS COES (Yorkville I), LLC (the “Debtor”) payable to YA Global Investments, L.P. (“YA Global”), and assigned to YA Corn Oil Systems, LLC (the “Secured Party”), in the original principal amount of $10,000,000 (the “Note”), (ii) that certain Security Agreement dated as of June __, 2010 (the “Security Agreement”) by and between the Debtor and YA Global, and assigned to the Secured Party; and (iii) that certain Guaranty Agreement dated as of June __, 2010 (the “Guaranty”, and together with the Note and the Security Agreement, the “COES Financing Documents”) executed and delivered by certain of the Debtor’s affiliates (jointly, severally, and collectively, the “Obligors”) to YA Global and assigned to the Secured Party.  Capitalized terms used and not defined herein shall have the meanings given thereto in the Security Agreement.

 

The Obligors hereby acknowledge and agree that one or more defaults and/or Events of Default have occurred and are continuing under the terms and conditions of the COES Financing Documents (the “Existing Defaults”).  In addition, the Note is payable on demand.  The Secured Party has notified the Obligors that it intends to exercise certain of its rights and remedies as a secured creditor, as such rights are set forth in the COES Financing Documents and under the Uniform Commercial Code.  Specifically, the Secured Party has indicated that it intends, subject to certain conditions, to accept the Collateral owned by the Debtor in satisfaction of the Debt (as defined below) (the “Acceptance”).

 

Accordingly, for good and valuable consideration, the sufficiency and receipt of which is hereby acknowledged, the Secured Party and the Obligors agree as follows:

	
1.  

	
The Secured Party’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 Secured Party in its sole and exclusive discretion:

 

	
a.  

	
The Secured Party shall be satisfied that all required notices and consents have been made pursuant to the provisions of Section 9-620 and 9-621 of the Uniform Commercial Code and that no party entitled to notice thereunder has provided the Secured Party with any notice of objection respecting the acceptance of the Collateral pursuant to said provisions of the Uniform Commercial Code.

 

	
b.  

	
The transfer and assignment to the Debtor of all contracts and agreements held by GS Cleantech Corporation (“Cleantech”) with respect to the COES Systems (as defined in the attached Schedule I) free and clear of all liens and encumbrances, except those in favor of YA Global;

 

	
c.  

	
The Secured Party shall have received a schedule from each of the owners of the ethanol plants in which the COES Systems are located, which sets forth the payoff amounts for any debt owed by the Debtor, CleanTech, or any of their affiliates to each respective owner;

 

	
d.  

	
The Secured Party shall have received the results of lien searches which are acceptable to the Secured party in all respects;

 

	
e.  

	
The Secured Party shall have received agreements from the owners of the ethanol plants in which the COES Systems are located in a form and of a nature acceptable to the Secured Party in all respects regarding the continued operation of such plants and for the repayment of any debt owed by the Debtor, CleanTech, or any of their affiliates to each respective owner;

 

	
f.  

	
The Secured Party shall have received a fully-executed management agreement from Greenshift Corporation in the form attached hereto as Exhibit “A”;

 

	
g.  

	
The Secured Party shall have completed due diligence with respect to the Collateral and any other matters that the Secured Party deems relevant to this transaction, including review of client and supplier relationships and contract terms (including confirmation that (a) the contracts for the COES Systems listed as numbers 1 – 3 in the definition of Collateral include the right to purchase corn oil at a rate equal to 53% diesel spot, and (b) the contract for the COES System located in Lakota, Iowa includes the right to purchase corn oil at a rate equal to 76% diesel spot), books and records, and the Secured Party shall be satisfied with the results of such due diligence in its sole and exclusive discretion;

 

	
h.  

	
All action on the part of the Obligors necessary for the valid execution, delivery and performance by the Obligors of this Agreement shall have been duly and effectively taken and evidence thereof satisfactory to the Secured Party shall have been provided to the Secured Party; and

 

	
i.  

	
This Agreement, and all documents, instruments, and agreements required to be delivered by the terms of this Agreement, shall be executed and delivered to the Secured Party by the parties thereto, shall be in full force and effect and shall be in a form and of a substance satisfactory to the Secured Party.

 

	
2.  

	
Each of the Obligors acknowledges and agrees that the Acceptance shall be effective June [__], 2010 (the “Effective Date”), unless the Secured Party receives an objection signed or authenticated by any other person, other than Debtor or other Obligors (which have consented to the Acceptance by executing a copy of this Agreement), holding an interest in the Collateral which is subordinate to the Secured Party’s interest or any secondary obligor of the Debt on or before the Effective Date; provided, however, that the Acceptance may, at the Secured Party’s option, be effective earlier than the Effective Date if the Secured Party receives authenticated consents to the Acceptance from all such parties on or before the Effective Date.

 

	
3.  

	
Each of the Obligors hereby: (i) ratifies, confirms, and reaffirms each of the terms and conditions of the COES Financing Documents; and (ii) acknowledges and agrees that the Existing Defaults have occurred and are continuing under the COES Financing Documents, and that such defaults and/or Events of Default cannot be cured.  Neither the provisions of this letter agreement nor any actions taken or not taken pursuant to the terms of this letter agreement shall constitute a modification or novation of any of the COES Financing Documents, all of which, except as expressly stated herein, remain in full force and effect in accordance with their respective terms.

 

	
4.  

	
Each of the Obligors hereby acknowledges and agrees that the Obligors are jointly and severally indebted to the Secured Party in the sum of not less than $10,000,000 plus interest accruing upon the principal balance of the Note, and all costs, expenses, costs of collection (including attorneys’ fees and expenses), fees, applicable redemption premiums, liquidated damages, and other amounts (collectively, the “Debt”), and that the Debt is secured by the Collateral.

 

	
5.  

	
Each of the Obligors hereby acknowledges and agrees that they have received the Secured Party’s Proposal to Accept Collateral in Satisfaction of Obligation in the form attached hereto as Exhibit “B” annexed hereto and incorporated herein (the “Secured Party’s Proposal”), pursuant to which the Secured Party has proposed to accept the Collateral in satisfaction of the Debt.

 

	
6.  

	
In connection with the Secured Party’s Proposal, each of the Obligors hereby:

 

	
(a)  

	
Acknowledges and agrees that they each remain jointly, severally, and unconditionally liable for all amounts owed under the COES Financing Documents;

 

	
(b)  

	
WAIVES any notice regarding the Acceptance to which it may have been entitled under the terms and conditions of the COES Financing Documents, the Uniform Commercial Code, or otherwise.  Notwithstanding the foregoing, each of the Obligors acknowledges and agrees that it has received full and timely notice of the Secured Party’s intention to accept the Collateral and that such notice was reasonable and sufficient in all respects;

	
(c)  

	
Acknowledges and agrees that it has carefully reviewed the terms and conditions of the Secured Party’s Proposal and has determined that:

	
(i)  

	
The Secured Party’s Proposal is reasonable and sufficient and complies in all respects with the terms and conditions of the COES Financing Documents and with Sections 9-620 and 9-621 of the Uniform Commercial Code;

 

	
(ii)  

	
The value of $10,000,000, plus all accrued and unpaid interest and costs and expenses due under the Note (collectively, the “Stipulated Value Amount”) for the Collateral set forth in the Lender’s Proposal and which will be (subject to the provisions of Section 7 below), upon acceptance of the Secured Party’s Proposal, applied in full satisfaction of the Debt, is a fair, reasonable, and sufficient value for the Collateral and, in any event, is in an amount in excess of that which would otherwise be received if the Secured Party conducted a secured party sale of the Collateral under the Uniform Commercial Code; and

 

	
(iii)  

	
It is in the best interests of each of the Obligors, respectively, to accept the Secured Party’s Proposal and otherwise to enter into this letter agreement;

 

	
(d)  

	
Irrevocably consents to, and accepts, the Secured Party’s Proposal and agrees that on the Effective Date, the Collateral shall immediately vest fully in the Secured Party, free and clear of all liens and other encumbrances, in accordance with the provisions of Sections 9-620 and 9-621 of the Uniform Commercial Code;

 

	
(e)  

	
Acknowledges and agrees that the Secured Party shall apply the Stipulated Value Amount in full satisfaction of the Debt in such order and manner determined by the Secured Party in its sole and exclusive discretion;

 

	
(f)  

	
Acknowledges and agrees that neither the provisions of this letter agreement, nor the surrender of the Collateral, shall release any Obligor (including without limitation, the Debtor) from any of its obligations and liabilities to YA Global;

 

	
(g)  

	
WAIVES any right to redeem the Collateral;

 

	
(h)  

	
Acknowledges and agrees that the Secured Party may, from time to time and at any time hereafter: (i) exercise any and all of its rights and remedies necessary or desirable to vest more securely title of the Collateral to and in the Secured Party pursuant to this letter agreement, the other COES Financing Documents, the Uniform Commercial Code, and other applicable law; and (ii) exercise any and any and all of its rights and remedies as a secured creditor pursuant to the COES Financing Documents, the Uniform Commercial Code, and other applicable law;

 

	
(i)  

	
The COES Financing Documents and all of the claims, rights, and other Obligations evidenced thereby have been assigned by YA Global to the Secured Party pursuant to a certain Non-Recourse Assignment of even date herewith (the “Non-Recourse Assignment”), a copy of which Non-Recourse Assignment has been provided to the Obligors in connection with the execution and delivery of this Agreement;

	
(j)  

	
Each Obligor has consented (and does hereby ratify and confirm such consent) to the assignment of the COES Financing Documents by YA Global to the Secured Party pursuant to the Non-Recourse Assignment;

 

	
(k)  

	
Each Obligor hereby ratifies, confirms, restates, and reaffirms the terms and conditions of the COES Financing Documents and ratifies, confirms, restates, reaffirms and remakes as of the date hereof for the benefit of the Secured Party, the representations and warranties contained therein, and the respective Obligations of the Obligors to the Secured Party thereunder;

 

	
(l)  

	
That each of YA Global and the Secured Party have fully performed its respective obligations to the Obligors under the COES Financing Documents;

 

	
(m)  

	
Acknowledges and agrees that each of the Obligors shall at all times: (i) cooperate fully with the transfer of the Collateral to the Secured Party in accordance with the terms hereof; and (ii) render all such reasonable assistance as the Secured Party may request in connection therewith, including, without limitation, executing such confirmatory assignments, instruments, and agreements as the Secured Party may reasonably request to further evidence the transfer of the Collateral to the Secured Party or further vest the title of the Collateral to and in the Secured Party.  Notwithstanding the foregoing, each of the Obligors expressly acknowledges and agrees that upon the Effective Date, the Acceptance shall be immediately effective to fully transfer all right, title, and interest of the Debtor in and to the Collateral to the Lender, without the necessity of the execution and delivery of any other or further instruments, documents, or agreements and/or notwithstanding any failure on the part of the Obligors or any other person to deliver any other instruments, documents, or agreements evidencing the Collateral to the Secured Party;

 

	
(n)  

	
Each of the Obligors hereby grants to the Secured Party or the Secured Party’s designee, as of the date hereof, all rights of possession in and to the Collateral.  This letter agreement also serves as an authorization to any employee of the Obligors or any third party to grant the Secured Party or, and each of the Obligors hereby grants the Secured Party or its designee, full and complete access to any premises where the Collateral is located to allow the Secured Party or its designee to take possession of any such Collateral in order to enforce the Secured Party’s rights and remedies in accordance with the COES Financing Documents and applicable law.  In addition, the Secured Party or its designee may designate a custodian who shall have the right, among other things, to change the locks on all gates and doors providing access to such premises or the Collateral.  Each of the Obligors knowingly and intelligently WAIVES any rights it may have to notice and a hearing before a court of competent jurisdiction in conjunction with the matters set forth in this letter agreement and consents to the Secured Party’s or the Secured Party’s designee’s entry on the premises where the aforesaid Collateral is located for the purposes set forth herein.

 

	
7.  

	
Each of the Obligors hereby acknowledges and agrees that it has no offsets, defenses, claims, or counterclaims against the Secured Party, and its manager, and each of their respective agents, servants, attorneys, advisors, officers, directors, employees, affiliates, representatives, investors, partners, members, managers, predecessors, successors, and assigns with respect to the COES Financing Documents, the Obligors’ obligations under, or relating to, the COES Financing Documents, the negotiation of this letter agreement, the Acceptance or otherwise, and that if such Obligor now has, or ever did have, any offsets, defenses, claims, or counterclaims against the Secured Party, its manager, and each of their respective agents, servants, attorneys, advisors, officers, directors, employees, affiliates, representatives, investors, partners, members, managers, 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, all of them are hereby expressly WAIVED, and each of the Obligors hereby RELEASES the Secured Party, its manager, and each of their respective agents, servants, attorneys, advisors, officers, directors, employees, affiliates, representatives, investors, partners, members, managers, predecessors, successors, and assigns from any liability therefor.

 

This letter shall be construed in accordance with the laws of the State of New Jersey, is intended to take effect as a sealed instrument, has been executed by each Obligor after consultation with independent counsel of its own selection, and is executed as of the date first set forth above.

[Remainder of Page Intentionally Left Blank; Signature Pages Follow]

  

  

  

  

This letter agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement.

Very truly yours,

GS COES (YORKVILLE I), LLC

By:_________________________

Name:           Kevin Kreisler

Title:           Managing Member

ACKNOWLEDGED AND AGREED:

YA CORN OIL SYSTEMS, LLC

By:____________________________

Name:             Troy Rillo

Title:             Manager

[Signature Page to Acceptance Agreement]

[Signatures Continued on Following Page]

  

  

  

  

_________________________________

Kevin Kreisler, Individually

VIRIDIS CAPITAL LLC

 

By_______________________________

Name:           Kevin Kreisler

Title:             Managing Member

GREENSHIFT CORPORATION (f/k/a GS CleanTech Corporation)

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

GS CLEANTECH CORPORATION (f/k/a GS Ethanol Technologies, Inc.)

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

GS COES (YORKVILLE I), LLC

 

By_______________________________

Name:           Kevin Kreisler

Title:             Managing Member

GS CARBON DIOXIDE TECHNOLOGIES, INC.

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

 

GS GLOBAL BIODIESEL, LLC

 

By_______________________________

Name:           Kevin Kreisler

Title:             Managing Member

 

 

GS AGRIFUELS CORPORATION

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

NEXTGEN ACQUISITION, INC.

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

NEXTGEN FUEL INC.

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

SUSTAINABLE SYSTEMS, INC.

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

SUSTAINABLE SYSTEMS LLC

 

By_______________________________

Name:           Kevin Kreisler

Title:             Managing Member

GS DESIGN, INC. (f/k/a Warnecke Design Service, Inc.)

 

By_______________________________

Name:           Kevin Kreisler

Title:             Chairman

GS RENTALS LLC (f/k/a Warnecke Rentals, LLC)

 

By_______________________________

Name:           Kevin Kreisler

Title:             Managing Member

[Signature Page to Acceptance Agreement]

[Signatures on following page]

  

  

  

  

ECOSYSTEM TECHNOLOGIES, LLC

 

By_______________________________

Name:         Kevin Kreisler

Title:           Managing Member

GS BIG MANAGEMENT, LLC

 

By_______________________________

Name:         Kevin Kreisler

Title:           Managing Member

GS COES (ADRIAN I), LLC

 

By_______________________________

Name:         Kevin Kreisler

Title:           Managing Member

GS TECHNOLOGY, LLC

 

By_______________________________

Name:         Kevin Kreisler

Title:           Managing Memberexhibit10c.htm

GLOBAL GUARANTY AGREEMENT

 

This GLOBAL GUARANTY AGREEMENT dated as of June __, 2010 (the “Guaranty”), is given by each of the individuals and entities listed on Schedule 1 attached hereto following (jointly, severally, and collectively, the “Guarantors”) in favor of YA CORN OIL SYSTEMS, LLC (together with its successors and assigns, the “Secured Party”).  Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Security Agreement (as defined below).

WHEREAS:

 

A. GreenShift Corporation (“GreenShift”) and the Secured Party have entered into a certain Management Agreement of even date herewith (the “Management Agreement”) pursuant to which GreenShift has agreed to perform management services in connection with certain corn oil extraction systems owned by the Secured Party in consideration for a monthly fee and, subject to the terms and conditions of the Management Agreement, the Secured Party making certain payments to YA Global Investments, L.P. (“YA Global”) for application in reduction of GreenShift’s and the Guarantors’ obligations and liabilities to YA Global.

 

B. Upon the mutual agreement of GS CleanTech Corporation (“CleanTech”) and the Secured Party, CleanTech may from time to time sell, pursuant to Sale and Assignment Agreements substantially in the form attached hereto as Exhibit A (the “Royalty Sale Agreement”) rights to receive royalties from licenses of certain patent rights granted by CleanTech to third parties (the “Royalties”).  Pursuant to the terms of each Royalty Sale Agreement,  Secured Party has a limited right to put the applicable Royalties back to the Assignor.

 

C. Each of the Guarantors has executed and delivered a Global Security Agreement, dated as of the date hereof (as may be amended and supplemented from time to time, the “Security Agreement”), pursuant to which the Guarantors pledged and granted to the Secured Party a security interest in and to all of the Guarantors’ assets and personal property;

 

D. The Guarantors will directly benefit from the Management Agreement, any sale of Royalties and from the financial accommodations made by the Secured Party to GreenShift pursuant to the Management Agreement and the various agreements and transactions referenced therein, and each Guarantor acknowledges that without this Guaranty, the Secured Party would not be willing to enter into the Management Agreement or make such accommodations.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth herein, and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, each Guarantor hereby agrees as follows:

 

SECTION 1                      Guaranty.

 

1.1 Guaranty.

 

(a) Each Guarantor, as direct obligor and not merely as surety, hereby unconditionally, absolutely, and irrevocably guarantees to the Secured Party the full payment and prompt performance of all of the Obligations.  Without limiting the foregoing, the Guarantors hereby agree that upon any Event of Default, the Guarantors shall immediately pay or perform any Obligations without notice, demand or formality of any kind.

 

(b) The term “Obligations” shall mean and include any and all debts, liabilities, obligations, covenants and duties owing by any Guarantor to the Secured Party, now existing or hereafter arising of every nature, type, and description, whether liquidated, unliquidated, primary, secondary, secured, unsecured, direct, indirect, absolute, or contingent, and whether or not evidenced by a note, guaranty or other instrument, and any amendments, extensions, renewals or increases thereof, including, without limitation, all those under (i) the Security Agreement; (ii) the Management Agreement; (iii) any agreement or document related to the Security Agreement and/or the Management Agreement; or (iv) any other or related documents, and including any interest accruing thereon after insolvency, reorganization or like proceeding relating to the Guarantors, whether or not a claim for post-petition interest is allowed in such proceeding, and all costs and expenses of the Secured Party incurred in the enforcement, collection or otherwise in connection with any of the foregoing, including, but not limited to, reasonable attorneys’ fees and expenses and all obligations of the Guarantors to the Secured Party to perform acts or refrain from taking any action.

 

1.2 Continuing Guaranty.

 

(a) The Obligations under this Guaranty are continuing, absolute, unconditional and irrevocable irrespective of the validity, regularity, enforceability or value of any of the Obligations and notwithstanding any claim, defense or right of set-off which the Guarantors may have against the Secured Party, including any such claim, defense or right based on any present or future applicable law and irrespective of any other circumstances which might otherwise constitute a legal or equitable release, defense or discharge of a surety or a guarantor.  Without limiting the generality of the foregoing, the Obligations of each Guarantor hereunder shall not be discharged or impaired or otherwise affected by:

 

(i) any rescission, waiver, amendment or modification of any terms or provisions of the Obligations or the documents evidencing the same.

 

(ii) any fraudulent, illegal, or improper act by any Guarantor or any failure, omission or delay on the part of any Guarantor to conform or comply with any term of the Obligations or of this Guaranty;

 

(iii) any failure of the Secured Party to assert a claim or demand or to enforce or exercise any right or remedy against any Guarantor or any other guarantor for any reason;

 

(iv) any release or discharge by operation of law or otherwise of any Guarantor from any Obligation or the documents evidencing the same;

 

(v) any change in the existence, structure or ownership of any Guarantor or the legal incapacity of any Guarantor;

 

(vi) any insolvency, bankruptcy, reorganization, arrangement, readjustment, composition, liquidation or other similar proceeding affecting any Guarantor or its/his assets or any resulting disallowance, release or discharge of all or any portion of the Obligations;

 

(vii) the failure by any Guarantor or any other person to sign this Guaranty; and

 

(viii) any other occurrence, circumstance, happening or event, whether similar or dissimilar to the foregoing and whether foreseen or unforeseen, which otherwise might constitute a legal or equitable defense or discharge of the liabilities of a guarantor or surety or which otherwise might limit recourse against any Guarantor.

 

(b) This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time payment or performance of the Obligations, or any part thereof, to the Secured Party is rescinded or must otherwise be returned by the Secured Party, whether in connection with the insolvency, bankruptcy or reorganization of any Guarantor, or otherwise, all as though such payment to the Secured Party has not been made.

 

1.3 Guaranty of Payment and Not of Collection; Subordination.

 

(a) The liability of each Guarantor shall be continuing, direct and immediate and not conditional or contingent upon either the pursuit of any remedies against GreenShift or any other Guarantor, or any other person or foreclosure of any security interests or liens available to the Secured Party, its successors, endorsees or assigns.  The Secured Party may accept any payment(s), plan for adjustment of debts, plan of reorganization or liquidation, or plan of composition or extension proposed by, or on behalf of, GreenShift or any Guarantor without in any way affecting or discharging the liability of any Guarantor. If the Obligations are partially paid, each Guarantor shall remain liable for any balance of such Obligations.  Without limiting any other provision of, impairing or affecting this Guaranty, the Secured Party may, at any time and from time to time, take or refrain from taking, all or any actions whatsoever, including the following actions: (a) retain or obtain a Lien (as defined in the Security Agreement) in any property to secure any of the Obligations; (b) amend, extend, renew, adjust, waive or release any Obligations or the terms thereof, (c) release or fail to perfect its interest in all or any property securing any of the Obligations or permit any substitution or exchange for any such property.

 

(b) With respect to any sum paid or payable by a Guarantor hereunder or in connection herewith or otherwise, all rights of such Guarantor against any other Guarantor arising as a result thereof by way of right of subrogation, contribution, reimbursement, indemnity or otherwise shall in all respects be subordinate and junior in right of payment to the prior indefeasible payment or performance in full of all the Obligations.  In addition, any indebtedness of any Guarantor now or hereafter held by any Guarantor is hereby subordinated in right of payment to the prior payment or performance in full of the Obligations and no Guarantor shall demand, sue for, or otherwise attempt to collect any such indebtedness, or prove any claim in competition with the Secured Party in respect of any payment hereunder in bankruptcy or insolvency proceedings of any nature.  If any amount shall erroneously be paid to any Guarantor on account of (i) such subrogation, contribution, reimbursement, indemnity or similar right or (ii) any such indebtedness of any Guarantor as borrower of a Guarantor, such amount shall be held in trust for the benefit of the Secured Party and shall forthwith be paid to the Secured Party to be credited against the payment of the Obligations.

 

1.4 Discharge. Each Guarantor covenants and agrees that this Guaranty will not be discharged, except by complete performance of the Obligations.

 

1.5 Interest.   Guarantors will pay on demand interest on all amounts due to the Secured Party under this Guaranty, or arising under any documents, instruments, or agreements relating to any collateral securing this Guaranty, from the time the Secured Party first demands payment of this Guaranty at a rate equal to the highest rate applicable to any of the Obligations after the earlier of (i) demand, or (ii) maturity, or (iii) the occurrence of any event of default under any instrument, document or agreement evidencing the Obligations (but in no event higher than the highest rate of interest which under the circumstances may be charged under applicable law).

 

1.6 Costs and Expenses. Without limiting any obligation of any Guarantor hereunder, each Guarantor agrees, jointly and severally, to pay all reasonable fees and costs (including, without limitation, reasonable attorneys’ fees and expenses, whether or not involving litigation and/or appellate or bankruptcy proceedings) incurred by Secured Party in (i) collecting or securing or attempting to collect or secure this Guaranty; and (ii) defending or prosecuting any actions or proceedings arising out of or relating to the Secured Party’s transactions with the Guarantors.

 

1.7 Indemnification.     For said good and valuable consideration, the Guarantors also shall, except with respect to the Secured Party’s gross negligence, willful misconduct or fraud, indemnify, defend, and hold the Secured Party, or any agent, employee, officer, attorney, or representative of the Secured Party, harmless of and from any claim brought or threatened against the Secured Party or any such person so indemnified by: any Guarantor, any other obligor or endorser of the Obligations or any other person (as well as from attorneys’ fees and expenses in connection therewith) on account of the Secured Party’s relationship with the Guarantors, or any other obligor or endorser of the Obligations (each of which may be defended, compromised, settled, or pursued by the Secured Party with counsel of the Secured Party’s selection, but at the expense of the undersigned).

 

SECTION 2                      Additional Guarantors.

 

Each subsidiary of the Guarantors that is formed or acquired after the execution of this Guaranty is required to execute the Guaranty.  Such subsidiary shall become a Guarantor hereunder with the same force and effect as if originally named as a Guarantor herein. The execution and delivery of any instrument adding an additional Guarantor as a party to this Guaranty shall not require the consent of any other Guarantor hereunder. The rights and obligations of each Guarantor hereunder shall remain in full force and effect notwithstanding the addition of any new Guarantor as a party to this Guaranty.

 

SECTION 3                      Representations and Warranties.

Each Guarantor hereby represents and warrants to the Secured Party as follows:

 

(a) each corporate Guarantor has full power, right and authority to enter into and perform its obligations under this Guaranty, and this Guaranty has been duly executed and delivered by each Guarantor and constitutes the valid and binding obligation of each Guarantor and is enforceable against each Guarantor in accordance with its terms.

 

(b) No permits, approvals or consents of or notifications to (i) any governmental entities, or (ii) any other persons or entities are necessary in connection with the execution, delivery and performance by any Guarantor of this Guaranty and the consummation by each Guarantor of the transactions contemplated hereby.

(c) Neither the execution and delivery of this Guaranty by any Guarantor nor the performance by them of the transactions contemplated hereby will:

(i) violate or conflict with or result in a breach of any provision of any law, statute, rule, regulation, order, permit, judgment, ruling, injunction, decree or other decision of any court or other tribunal or any governmental entity or agency binding on a Guarantor or his properties, or conflict with or cause an event of default under any contract or agreement of a Guarantor; or

(ii) require any authorization, consent, approval, exemption or other action by or notice to any court, administrative or governmental body, person, entity or any other third party.

 

(d) The Guarantors have no pending or threatened litigation, arbitration, actions or proceedings which if adversely decided could reasonably be expected to result in a material adverse effect, individually or in the aggregate, except as set forth on the attached Schedule 2.

 

SECTION 4.                                Event of Default.

 

(a) For purposes of this Guaranty, an “Event of Default” shall be deemed to have occurred upon the occurrence of one or more of the following after the date hereof: (i) a default or Event of Default under the Security Agreement, or (ii) the occurrence of a default under the Management Agreement.

 

(b) Upon the occurrence of an Event of Default, at the option of the Secured Party, all of the obligations of each Guarantor hereunder shall be immediately due and payable without any action on the part of the Secured Party, and the Secured Party shall be entitled to seek and institute any and all remedies available to it.

 

SECTION 5                      Remedies, Other Obligations, Breaches and Injunctive Relief.

 

(a) No remedy conferred under this Guaranty upon the Secured Party is intended to be exclusive of any other remedy available to the Secured Party, pursuant to the terms of this Guaranty or otherwise, at law or in equity (including a decree of specific performance and/or other injunctive relief).  No single or partial exercise by the Secured Party of any right, power or remedy hereunder shall preclude any other or further exercise thereof.

 

(b) The failure of the Secured Party to exercise any right or remedy under this Guaranty or otherwise, or delay in exercising such right or remedy, shall not operate as a waiver thereof.

 

(c) Every right and remedy of the Guarantors under any document executed in connection with this transaction, including but not limited to this Guaranty, or under applicable law may be exercised from time to time and as often as may be deemed expedient by the Secured Party.

 

(d) The Guarantors acknowledge that a breach by a Guarantor of its/his obligations hereunder will cause irreparable harm to the Secured Party and that the remedy at law for any such breach may be inadequate. The Guarantors therefore agree that, in the event of any such breach or threatened breach by the Guarantors, the Secured Party shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, and specific performance without the necessity of showing economic loss and without any bond or other security being required.  Nothing herein shall limit Secured Party’s right to pursue actual damages for any failure by a Guarantor to comply with the terms of this Guaranty.

 

SECTION 6                      Maximum Liability.

 

Notwithstanding any provision herein contained to the contrary, each Guarantor’s liability under this Guaranty shall be limited to an amount not to exceed as of any date of determination the amount which could be claimed by any Secured Party from such Guarantor under this Guaranty without rendering such claim voidable or avoidable under Section 548 of the Bankruptcy Code (11 U.S.C. §§ 101 et seq.) or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law (the “Avoidance Provisions”) after taking into account, among other things, such Guarantor’s right of contribution and indemnification from each other Guarantor, if any.  To the end set forth above, but only to the extent that the Obligations of a Guarantor hereunder (the “Guaranty Obligations”) would otherwise be subject to avoidance under the Avoidance Provisions, if such Guarantor is not deemed to have received valuable consideration, fair value, fair consideration or reasonably equivalent value for the Guaranty Obligations, or if the Guaranty Obligations would render such Guarantor insolvent, or leave such Guarantor with an unreasonably small capital to conduct its business, or cause such Guarantor to have incurred debts (or to have intended to have incurred debts) beyond its ability to pay such debts as they mature, in each case as of the time any of the Guaranty Obligations is deemed to have been incurred for the purposes of the Avoidance Provisions, the maximum Guaranty Obligations for which such Guarantor shall be liable hereunder shall be reduced to that amount which, after giving effect thereto, would not cause the Guaranty Obligations as so reduced, to be subject to avoidance under the Avoidance Provisions.

 

SECTION 7                      Miscellaneous.

 

7.1           Notices, Consents, etc. Any notices, consents, waivers or other communications required or permitted to be given under the terms hereof must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one (1) business day after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be:

 

If to any Guarantor:                                                             c/o GreenShift Corporation

One Penn Plaza, Suite 1612

New York, NY 10119

Attention:  Kevin Kreisler

Telephone:                   (212) 994-5374

Facsimile:                      (646) 572-6336

 

With Copies to:                                                                    Glenn Schoenfeld, Esquire

405 Park Avenue, Suite 502

New York, New York 10022

Telephone:                   (212) 754-7000

Facsimile:                      (212) 758-0143

If to Secured Party:                                                             YA Corn Oil Systems, LLC

c/o Yorkville Advisors, LLC

101 Hudson Street-Suite 3700

Jersey City, New Jersey 07302

Attention: Troy Rillo

Telephone:                   (201) 985-8300

Facsimile:                      (201) 985-1964

 

With Copies to:                                                                   Douglas K. Clarke, Esquire

Riemer & Braunstein LLP

Three Center Plaza

Boston, Massachusetts 02108

Telephone:                   (617) 880-3485

Facsimile:                      (617) 692-3485

or at such other address and/or facsimile number and/or to the attention of such other person as the recipient party has specified by written notice given to each other party three (3) business days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing the time, date, recipient facsimile number and an image of the first page of such transmission or (C) provided by a nationally recognized overnight delivery service, shall be rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.

 

7.2           Waiver of Presentment. To the fullest extent permitted by law and except as otherwise provided herein, the Guarantors waive demand, presentment, protest, notice of dishonor, suit against or joinder of any other person, and all other requirements necessary to charge or hold each Guarantor liable with respect to this Guaranty.

 

7.3           Severability. If any provision of this Guaranty is, for any reason, invalid or unenforceable, the remaining provisions of this Guaranty will nevertheless be valid and enforceable and will remain in full force and effect.  Any provision of this Guaranty that is held invalid or unenforceable by a court of competent jurisdiction will be deemed modified to the extent necessary to make it valid and enforceable and as so modified will remain in full force and effect.

 

7.4           Amendment and Waiver. This Guaranty may be amended, or any provision of this Guaranty may be waived, provided that any such amendment or waiver will be binding on a party hereto only if such amendment or waiver is set forth in a writing executed by the parties hereto. The waiver by any such party hereto of a breach of any provision of this Guaranty shall not operate or be construed as a waiver of any other breach.

7.5           Headings. The subject headings of Articles and Sections of this Guaranty are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions.

 

7.6           Assignment. This Guaranty will be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, but will not be assignable or delegable by the Guarantors. Except as otherwise provided herein, this Guaranty shall bind and inure to the benefit of and be enforceable by the parties and their permitted successors and assigns.  The Guarantors acknowledge and agree that the Secured Party has the right to assign and transfer this Guaranty, including without limitation, to YA Global Investments, L.P.

 

7.7           Further Assurances. Each party will execute all documents and take such other actions as the other parties may reasonably request in order to consummate the transactions provided for herein and to accomplish the purposes of this Guaranty.

 

7.8           Third Parties. Nothing herein expressed or implied is intended or shall be construed to confer upon or give to any person or entity, other than the stated beneficiaries of this Guaranty and their respective permitted successors and assigns, any rights or remedies under or by reason of this Guaranty.

 

7.9           Liability of Guarantors.  Notwithstanding any provision herein, the Guarantors, and each of them, are and shall be jointly and severally liable for any and all Obligations (whether any such Obligation is specified as an obligation of the Guarantors or of any of them).

 

7.10           No Strict Construction. The language used in this Guaranty will be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction will be applied against any party hereto.

 

7.11           Governing Law; Jurisdiction. This Guaranty shall be governed by and interpreted in accordance with the laws of the State of New Jersey without regard to the principles of conflict of laws. The parties further agree that any action between them shall be heard in Hudson County, New Jersey, and expressly consent to the jurisdiction and venue of the Superior Court of New Jersey, sitting in Hudson County and the United States District Court for the District of New Jersey sitting in Newark, New Jersey for the adjudication of any civil action asserted pursuant to this Paragraph, provided, however, that nothing herein shall prevent the Secured Party from enforcing its rights and remedies (including, without limitation, by filing a civil action) with respect to the Collateral and/or the Guarantors in any other jurisdiction in which the Collateral and/or the Guarantors may be located.  Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Guaranty and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.

 

7.12           Waiver of Jury Trial. AS A MATERIAL INDUCEMENT FOR THE SECURED PARTY TO MAKE FINANCIAL ACCOMMODATIONS TO GS COES OR ANY GUARANTOR, EACH GUARANTOR HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS GUARANTY AND/OR ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS TRANSACTION.

 

7.13           Counterparts; Facsimile Signatures.  This Guaranty may be executed and delivered by exchange of facsimile signatures of the Secured Party and the Guarantors, and those signatures need not be affixed to the same copy.  This Guaranty may be executed in any number of counterparts.

 

7.14           Entire Agreement. This Guaranty (including the recitals hereto) and the other documents or agreements delivered in connection herewith set forth the entire understanding of the parties with respect to the subject matter hereof, and shall not be modified or affected by any offer, proposal, statement or representation, oral or written, made by or for any party in connection with the negotiation of the terms hereof, and may be modified only by instruments signed by all of the parties hereto.

 

7.15           Collateral.                      The Guarantors’ obligations to the Secured Party hereunder shall be secured by all collateral heretofore or hereafter granted to the Secured Party by the Guarantors, whether in connection with this Guaranty or otherwise.

 

7.16           Existing Guaranty.  The Guaranty is intended to be supplemental to, and not in limitation of, any existing guaranty in favor of the Secured Party to secure the Obligations.  All such existing guaranty, and any rights of the Secured Party in connection therewith, shall remain in full force and effect in accordance with their respective terms.

[remainder of page intentionally blank]

  

  

  

  

IN WITNESS WHEREOF, each Guarantor has caused this Global Guaranty Agreement to be signed as of the date first written above.

_________________________________

Kevin Kreisler, Individually

 

VIRIDIS CAPITAL LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

GREENSHIFT CORPORATION (f/k/a GS CleanTech Corporation)

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

GS CLEANTECH CORPORATION (f/k/a GS Ethanol Technologies, Inc.)

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

GS COES (YORKVILLE I), LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

GS CARBON DIOXIDE TECHNOLOGIES, INC.

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

 

GS GLOBAL BIODIESEL, LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

 

GS AGRIFUELS CORPORATION

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

NEXTGEN ACQUISITION, INC.

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

NEXTGEN FUEL INC.

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

SUSTAINABLE SYSTEMS, INC.

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

SUSTAINABLE SYSTEMS LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

GS DESIGN, INC. (f/k/a Warnecke Design Service, Inc.)

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Chairman

GS RENTALS LLC (f/k/a Warnecke Rentals, LLC)

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

[Signature Page to Global Guaranty Agreement]

[Signatures Continue on following page]

  

  

  

  

ECOSYSTEM TECHNOLOGIES, LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

GS BIG MANAGEMENT, LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

GS COES (ADRIAN I), LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

GS TECHNOLOGY, LLC

 

By_______________________________

Name:               Kevin Kreisler

Title:                 Managing Member

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00187-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00187-of-00352.parquet"}]]