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AMENDMENT NO. 1 TO REIMBURSEMENT AGREEMENT
AND RELEASE OF ASSIGNMENT (OWL)
THIS AMENDMENT NO. 1 TO REIMBURSEMENT AGREEMENT (this "Amendment"), dated as of
the __ day of September, 1997, relates to that certain Reimbursement Agreement
dated as of January 15, 1993 (the "Agreement"), by Orrington Waste, Ltd. Limited
Partnership, an Oregon limited partnership (the "Company"), in favor of Morgan
Guaranty Trust Company of New York (the "Bank").
WHEREAS, the Bank has issued the Letter of Credit in the original stated
amount of $1,000,000, which amount has been reduced to the current amount of
$200,000; and
WHEREAS, The Prudential Insurance Company of America (the "Limited Partner") has
heretofore entered into the Contribution Agreement, which the Company has
assigned to the Bank to secure repayment of amounts due the Bank under the
Agreement pursuant to the Assignment; and
WHEREAS, pursuant to a Purchase and Option Agreement dated as of the date hereof
(the "LP Purchase Agreement") between the Limited Partner and PERC Management
Company Limited Partnership, a Maine limited partnership ("PMC"), the Limited
Partner has sold to PMC all of its rights and interests in and to its limited
partnership interest in the Company; and
WHEREAS, the Limited Partner, PMC and the Company have asked the Bank to
reassign the Contribution Agreement to the Company and to accept in substitution
therefor a letter of credit to be issued by Key Bank of New York for the account
of PMC's affiliate, KTI, Inc., a New Jersey corporation ("KTI"), in the stated
amount of $200,000, in favor of the Bank, and to amend the Agreement to so
provide, and the Bank has agreed to do so, as set forth herein. Terms used
herein and defined in the Agreement are used herein as therein defined.
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Amendments. The Agreement is amended as follows:
1.1 Section 1(a)(i) is amended by adding at the end thereof,
the following clause:
provided that, the Company's repayment obligation set forth in this
Section 1(a) shall be satisfied upon the drawing by the Bank
of a like amount under an irrevocable letter of credit issued
by Key Bank of New York in the original stated amount of
$200,000, for the account of KTI, Inc., in the form of Exhibit
C (the "Key Bank Letter of Credit").
1.2 A new Exhibit C (the form of Key Bank Letter of Credit) is added
to the Agreement in the form attached hereto as Exhibit C.
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Section 2. Release, Termination and Reassignment. The Bank hereby releases
and terminates the Assignment and reassigns the Contribution Agreement to the
Company.
Section 3. Deadline Drawing. If a Deadline Drawing has been made, the Bank
shall hold the proceeds of such Deadline Drawing as collateral for any drawings
made on the Letter of Credit from December 1, 1997 until December 31, 1997. The
Bank will deposit such proceeds in an interest-bearing money market savings
account (the "Pledged Account") established with the Bank (or its designated
affiliate) in the name of KTI, which account is hereby pledged and a security
interest granted to the Bank. To the extent a drawing occurs under the Letter of
Credit after December 1, 1997, the Bank shall apply funds from the proceeds of
the Deadline Drawing as reimbursement for such drawing and all other amounts
payable to the Bank under the Reimbursement Agreement. At such time as the
Letter of Credit is returned to the Bank for cancellation and all Obligations
under the Agreement have been paid or provided for, the Bank shall pay over to
KTI all funds and amounts then remaining in the Pledged Account.
Section 4. Further Assurances. The Bank agrees to execute such releases,
terminations, reassignments, financing statement terminations or amendments or
such other like documents to effect such release, termination and reassignment
as the Company or the Limited Partner may reasonably request.
Section 5. No Consent or Waiver. Except as expressly provided for herein,
this Amendment shall not constitute a consent to any action or transaction or a
waiver or modification of any provision, term or condition of any of the
Agreement.
Section 6. Agreement Continues in Effect. All terms, provisions,
covenants, representations, warranties, agreements and conditions contained in
the Agreement shall remain in full force and effect except as expressly provided
for herein.
Section 7. Counterparts. This Amendment may be executed in any number of
counterparts, each of which counterpart when executed and delivered shall be
deemed an original and all of which counterparts, when taken together, shall
constitute one and the same Amendment.
Section 8. Governing Law. This Amendment shall be construed in accordance
with the laws of the State of New York, without regard to principles of conflict
of laws.
Section 9. References to Agreement. From and after the effectiveness of
this Amendment any reference to the Agreement shall be deemed to be a reference
to the Agreement as amended by this Amendment.
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the date first written above.
ORRINGTON WASTE, LTD. LIMITED PARTNERSHIP
By: Pacific Orrington Energy, Inc.
The General Partner thereof
By: /s/ Franklin D. Wareham
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Its: Vice Presdident
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
By /s/ Maria Dell'Acquila
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Title: Vice President
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KTI, INC. is entering into this Amendment for purposes of granting the
security interest in the Pledged Account under Section 3 of this Amendment.
Dated: September __________, 1997
KTI, INC.
By /s/ Martin J. Sergi
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Its: President
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Accepted and acknowledged as of this ___ day of September, 1997.
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By: /s/ John Wand
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Its: Vice President
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Accepted and acknowledged as of this ___ day of September, 1997.
PERC MANAGEMENT COMPANY LIMITED
PARTNERSHIP
By: PERC, Inc., the General Partner
thereof
By /s/ Martin J. Sergi
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Its: President
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