1
Exhibit 4.4
ELECTRIC RATE STABILIZATION BOND PROGRAM
LIMITED GUARANTY AGREEMENT
This Guaranty Agreement dated as of June 1, 1998, (the "Guaranty") is
given by KTI, INC., a corporation organized and existing under the laws of the
State of New Jersey (the "Guarantor") to THE CHASE MANHATTAN BANK, as Trustee
(the "Trustee").
WHEREAS, the Finance Authority of Maine ("the Authority") has agreed
with Penobscot Energy Recovery Company, Limited Partnership (the "Borrower") to
issue its Series 1998 Electric Rate Stabilization Revenue Refunding Bonds,
Series 1998A and Series 1998B (Penobscot Energy Recovery Company, LP) in the
aggregate principal amount of $44,995,000 (the "1998 Bonds"), which will
contemporaneously herewith be issued to finance a loan (the "Loan") from the
Authority to Penobscot Energy Recovery Company, Limited Partnership (the
"Borrower") pursuant to a Loan Agreement dated as of June 1, 1998 (the
"Agreement"); and
WHEREAS, the Agreement will be assigned by the Authority to the Trustee
(except for certain Unassigned Issuers Rights and Shared Rights as defined
therein), contemporaneously with the execution thereof; and
WHEREAS, the obligation of the Borrower to the Authority pursuant to
the Agreement is evidenced by a promissory note of the Borrower to the Authority
(the "Loan Note"); and
WHEREAS, the Trustee has entered into a Trust Indenture with the
Authority dated as of June 1, 1998 (the "Indenture"); and
WHEREAS, the Guarantor is the sole shareholder of PERC, Inc.; PERC,
Inc. is the general partner of PERC Management Company Limited Partnership, a
general partner of the Borrower; and
WHEREAS, in order to induce the Authority to make the Loan to the
Borrower, the Guarantor is prepared to guarantee the payment and performance
when due of the obligations of the Borrower to the Authority under the Loan
Agreement, subject to the limitations hereinafter set forth; and
WHEREAS, the Guarantor acknowledges that it will be benefited by the
Authority making the Loan to the Borrower; and
WHEREAS, for the purpose of providing security for the payment of the
Loan Note and other sums provided for in the Agreement, the Guarantor hereby
agrees to guaranty the prompt and punctual payment of the Loan and other sums,
as more fully set forth herein and in the Indenture and subject to the
limitations herein; and
NOW, THEREFORE, in consideration of the premises and in order to induce
the Authority to issue the 1998 Bonds and make the Loan, the Guarantor hereby
covenants and agrees with the Trustee as follows:
Page 1
2
ARTICLE I
REPRESENTATIONS AND WARRANTIES
Section 1.1. Representations and Warranties. The Guarantor hereby
represents and warrants as follows:
(1) The Guarantor is a corporation duly organized, validly
existing and in good standing under the laws of the State of New Jersey, has the
corporate powers and authority to own its property and assets, to carry on its
business as now being conducted by it and to execute, deliver and perform this
Guaranty. The Guarantor is duly qualified to do business in every jurisdiction
in which such qualification is necessary.
(2) The execution, delivery and performance of this Guaranty
and the consummation of the transactions herein contemplated have been duly
authorized by all requisite corporate action on the part of the Guarantor and
will not violate any provision of law, any order of any court or other agency of
government or the certificate of incorporation or bylaws of the Guarantor, or
any material provision of any indenture, agreement or other instrument to which
the Guarantor is a party or by which it or any of its property is bound, or be
in conflict with or result in a breach of or constitute (with due notice and/or
lapse of time) a default under any such indenture, agreement or other instrument
for which a waiver has not been obtained.
(3) The acceptance by the Guarantor of its obligations
hereunder will result in a material financial benefit to the Guarantor.
(4) This Guaranty constitutes a valid and legally binding
obligation of the Guarantor, enforceable in accordance with its terms.
(5) There is no action or proceeding pending or to the
knowledge of the Guarantor, threatened against the Guarantor before any court or
administrative agency which, if determined adversely to the Guarantor would
materially adversely affect the ability of the Guarantor to perform its
obligations hereunder, except as may be disclosed in its filings with the
Securities and Exchange Commission.
(6) No authorizations, approvals or other actions are required
by any governmental authority or regulatory body for due execution, delivery and
performance by the Guarantor of this Guaranty.
(7) The Guarantor has fulfilled its obligations under the
minimum funding standards of ERISA with respect to any employee pension benefit
plan which is covered by Title 4 of ERISA, which is the subject of the minimum
funding standard under Section 412 of the Internal Revenue Code, and as to which
the Guarantor may have liability (or with respect to a multi-employer Plan has
made all required contributions) and is in compliance in all material respects
with applicable provisions of ERISA.
Page 2
3
ARTICLE II
COVENANTS AND AGREEMENTS
Section 2.1. The Guaranty.
(A) The Guarantor hereby unconditionally guaranties to and for the
account of the Trustee for the benefit of the holders of the 1998 Bonds and to
and for the benefit of the Authority as holder of the Loan Note to the extent of
this Guaranty as limited by Section 2.1(C) hereof, (i) the full and prompt
payment of the principal on the Loan when and as the same shall become due,
whether by demand or at the stated maturity thereof, by acceleration or
otherwise; (ii) the full and prompt payment of the interest on the Loan when and
as the same shall become due and payable; (iii) the full and prompt payment of
all principal, interest and other sums due and payable on the Loan Note and any
other sums when and as the same shall become due and payable under the Financing
Documents (as that term is defined in the Agreement), required to be paid by the
Borrower under the terms of the Agreement, whether by acceleration or otherwise
(the "Obligations")
(B) The Guarantor hereby expressly acknowledges and agrees to the terms
of Article V of the Indenture, a copy of which Article V is attached hereto as
Exhibit A and incorporated herein to the extent such terms affect or create the
obligation of the Guarantor to make payment of the Obligations and create rights
of the Trustee to enforce this Guaranty.
(C) The Guarantor further agrees that each of its undertakings in
subsection 2.1(A) and 2.1(B) above constitutes an absolute, unconditional,
present and continuing guaranty provided, however, that the obligation of the
Guarantor to pay such Obligation shall be limited to $3,000,000, provided,
however, if any amounts are paid by the Guarantor to the Trustee pursuant to
this Guaranty, and the Trustee thereafter reimburses the Guarantor pursuant to
Section 5.03(9) and Section 5.11 of the Indenture, this Guaranty will be
reinstated by the amount of such reimbursement. The Guarantor waives any right
to require that any resort be had by the Trustee to (i) any particular security
held by the Authority or the Trustee (except as otherwise provided in the
Indenture) or (ii) the performance of any obligation of the Authority or the
Trustee under the Indenture.
(D) If the Borrower shall default in payment of the Obligations the
Guarantor, upon demand by the Trustee without notice other than such demand and
without the necessity of further action on their respective parts, or
Guarantor's successors or assigns, as the case may be, will promptly and fully
comply with the efforts of the Trustee to enforce this Guaranty. The Guarantor
will pay all reasonable costs and expenses, including reasonable attorneys'
fees, paid or incurred by the Trustee in connection with the enforcement of the
obligations of the Guarantor under this Guaranty. All payments by the Guarantor
shall be made in any coin or currency of the United States of America which on
the respective dates of payment thereof is legal tender for the payment of
public and private debts within two (2) Business Days of demand from the
Trustee.
Section 2.2. Absolute and Unconditional Limited Guaranty. Except as
expressly limited by the terms hereof, the obligations of the Guarantor under
this Guaranty are absolute and unconditional and shall remain in full force and
effect until every payment, obligation or liability guaranteed hereunder shall
have been fully and finally paid, and, to the extent permitted by law, such
obligations shall not be
Page 3
4
affected, modified, released, or impaired by any state of facts or the happening
from time to time of any event including, without limitation, any of the
following, whether or not with notice to, or the consent of, the Guarantor:
(1) the termination, cancellation, invalidity, irregularity,
illegality or unenforceability of, or any defect in, the Indenture, any of the
1998 Bonds, this Guaranty, the Agreement, the Loan Note or any other Financing
Documents;
(2) the compromise, settlement, release, extension,
indulgence, change, modification or termination of any or all of the
obligations, covenants or agreements of the Agreement, the Loan Note, the
Indenture, the 1998 Bonds, or any other guaranties, or any other Financing
Documents;
(3) the failure to give notice to the Guarantor of the
occurrence of any Event of Default under the terms and provisions of this
Guaranty, the Indenture, the Agreement, the Loan Note or any other Financing
Documents;
(4) the waiver of the payment, performance or observance by
the Authority or the Trustee of any of the obligations, conditions, covenants or
agreements of any or all of them contained in this Guaranty, the Indenture, the
1998 Bonds the Agreement, the Loan Note or any other Financing Documents by the
Authority or the Trustee, as the case may be;
(5) the extension of the time for payment of the principal of,
premium if any, or interest on the 1998 Bonds or the principal of, or interest
on the 1998 Bonds or any other amounts that are due or may become due under the
Financing Documents or of the time for performance of any other obligations,
covenants or agreements under or arising out of the Financing Documents;
(6) the modification or amendment (whether material or
otherwise) of any duty, obligation, covenant or agreement set forth in the
Indenture, the 1998 Bonds, or any of the Financing Documents;
(7) any failure, omission, delay or lack thereof on the part
of the Authority or the Trustee to assert or exercise any right, power or remedy
conferred on either of them in the Indenture, the 1998 Bonds, this Guaranty, the
Agreement, or any other Financing Documents;
(8) the voluntary or involuntary liquidation, dissolution,
merger, consolidation, sale or other disposition of all or substantially all the
assets, marshalling of assets and liabilities, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, reorganization,
arrangement, composition with creditors, or other similar proceedings affecting
the Guarantor, any other guarantors, or the Borrower, the Authority or the
Trustee, or any or all of the assets of any of them, or any allegation or
contest of the validity of the Indenture, the 1998 Bonds, or any of the
Financing Documents including this Guaranty in any such proceeding; it is
specifically understood, consented and agreed to that this Guaranty shall remain
and continue in full force and effect and shall be enforceable against the
Guarantor to the same extent and with the same force and effect as if such
proceedings had not been instituted; and it is the intent and purpose of this
Guaranty that the Guarantor shall and does hereby waive all rights and benefits
which might accrue to the Guarantor by reason of any such
Page 4
5
proceedings, and without limiting the generality of the foregoing, it is further
the intent and purpose of this Guaranty that the liability of the Guarantor
shall not be in any way limited by the filing of any bankruptcy involving the
Borrower, but rather shall in all respects continue and extend to include, by
way of example and not limitation, post-filing interests and costs, including
reasonable attorney's fees;
(9) to the extent permitted by law, the release or discharge
of the Guarantor from the performance or observance of any obligation, covenant
or agreement contained in this Guaranty by operation of law or the addition or
release of any other guarantor;
(10) the default or failure of any other guarantor fully to
perform any of its obligations set forth in any other guaranty;
(11) any release, substitution, replacement, destruction, loss
or impairment of the security pledged under the Financing Documents;
(12) any failure of the Authority or the Trustee to mitigate
damages resulting from any default by the Borrower under the Financing
Documents;
(13) any other circumstances which might otherwise constitute
a legal or equitable discharge or defense of a surety or a guarantor; or
(14) any other act of commission or omission or any other
occurrence whatsoever, whether similar or dissimilar to the foregoing.
Section 2.3. Qualified Letter of Credit; Release of Guaranty. With the
written consent of the Authority, the Guarantor may provide as a substitute for
this Guaranty a letter of credit satisfactory to the Authority for this
Guaranty.
Section 2.4. Changes in Ownership; Continuing Existence. (a) The
Guarantor will maintain its corporate existence in good standing under the laws
of the jurisdiction of incorporation and its qualification to transact business
in each jurisdiction where failure so to qualify would permanently preclude the
Guarantor from enforcing its rights with respect to any material asset or would
expose the Guarantor to any material liability; provided, however, that nothing
herein shall prohibit the merger or consolidation described in clause (b) of
this Section 2.4.
(b) The Guarantor will not merge or consolidate or enter into any
analogous reorganization or transaction with any Person or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), unless the surviving
corporation (i) assumes in writing the obligations of the Guarantor, (ii) has a
net worth determined in accordance with GAAP) at least equal to the consolidated
net worth (determined in accordance with GAAP) of the Guarantor as shown on the
most recent audited financial statements of the Guarantor prior to the merger or
consolidation and (iii) the shareholders of the Guarantor will have a majority
interest in the surviving Person.
Section 2.5. Good Standing. The Guarantor warrants that it is and will
be during the term of this Agreement incorporated and in good standing in all
jurisdictions in which it does business.
Page 5
6
Section 2.6. Indemnification Covenants.
(A) The Guarantor agrees to protect, defend and hold harmless the
Authority and its officers, members, directors, agents, servants and employees
(each an "Indemnified Party") from any claim, demand, suit or action or other
proceeding whatsoever by any person or entity whatsoever, arising or purportedly
arising from or in connection with the Guaranty or the transactions contemplated
thereby or actions taken thereunder, except for any bad faith, willful
misconduct material misrepresentation or gross negligence on the part of the
Indemnified Party.
(B) All covenants, stipulations, promises, agreements and obligations
of the Authority contained herein shall be deemed to be the covenants,
stipulations, promises, agreements and obligations of the Authority and not of
any member, officer, director, agent or employee of the Authority in his or her
individual capacity, and no recourse shall be had for the payment of any claim
based thereon or hereunder against any member, officer or employee of the
Authority or any natural person executing the 1998 Bonds.
(C) In case any action shall be brought against one or more of the
Indemnified Party's based upon any of the above and in respect of which
indemnity may be sought against the Guarantor, such Indemnified Party shall
notify the Guarantor in writing, enclosing a copy of all papers served, but the
omission so to notify the Guarantor of any such action shall not relieve it of
any liability which it may have to any Indemnified Party other than under this
Section 2.6. In case any such action shall be brought against any Indemnified
Party and it shall notify the Guarantor and the Borrower of the commencement
thereof, the Guarantor shall be entitled to participate in and, to the extent
that it shall wish, to assume the defense thereof with counsel satisfactory to
such Indemnified Party, and after notice from the Guarantor to such Indemnified
Party of the Guarantor's election so to assume the defense thereof the Guarantor
shall not be liable to such Indemnified Party for any legal or other expenses,
other than reasonable costs of investigation subsequently incurred by such
Indemnified Party in connection with the defense thereof. The Indemnified Party
shall have the right to employ its own counsel in any such action, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Party
unless (i) the employment of counsel by such Indemnified Party has been
authorized by the Guarantor, (ii) the Indemnified Party shall have reasonably
concluded that there may be a conflict of interest between the Borrower and/or
Guarantor and the Indemnified Party in the conduct or the defense of such action
(in which case the Guarantor shall not have the right to direct the defense of
such action on behalf of the Indemnified Party), or (iii) the Guarantor shall
not in fact have employed counsel satisfactory to the Indemnified Party to
assume the defense of such action.
(D) The Guarantor also agrees to pay all reasonable and necessary
out-of-pocket expenses of the Authority (including reasonable charges of
counsel) in connection with the Guaranty and the enforcement of any rights
hereunder, including, without limitation, any fees, charges and expenses
(including reasonable charges of counsel).
(E) The obligations of the Guarantor under this section shall survive
the termination of this Guaranty. This section is not for the benefit of any
person not an Indemnified Party, and no waiver of the Maine Tort Claims Act or
other applicable law is intended.
Section 2.7. Submission of Financial Statements. The Guarantor shall
provide the
Page 6
7
Authority with a copy of its annual audited financial statements within 105 days
after the close of its Fiscal Year, provided however, that if the Guarantor's
annual audited financial statements are incorporated into a 10-K submitted to
the Authority pursuant to Section 2.9 hereof, the Guarantor will not be
separately obligated to submit its financial statements.
Section 2.8. Default and Litigation Notification. Upon becoming aware
of any condition or event which constitutes, or with the giving of notice or the
passage of time would constitute, an Event of Default, the Guarantor immediately
shall deliver to the Authority a notice stating the existence and nature thereof
and specifying the corrective steps the Guarantor is taking with respect
thereto. The Guarantor shall promptly notify the Authority of the commencement
of any litigation, administrative, enforcement or other proceeding by or against
it with a claim or demand of $5,000,000 or greater, or the threat thereof, in
which an unfavorable outcome could materially adversely affect the financial
condition of the Guarantor.
Section 2.9. Notification of SEC Filings. The Guarantor must provide
the Authority with copies of each filing and report made by the Guarantor with
or to the Securities and Exchange Commission including, without limitation, all
10-Q, 10-K and 8-K Reports (other than registration statements that have not
become effective under the Securities Act of 1933, filings and reports with
respect to dividend reinvestment, employee benefits, or other similar plans, and
filings pertaining to sales of or other transactions in securities of the
Guarantor by persons other than the Guarantor), and of each communication from
the Guarantor to public shareholders generally, promptly upon the filing or
making thereof. The Guarantor must meet periodically with the Authority at the
Authority's reasonable request to provide information on financial conditions
(whether or not included in such filings) and any other issue raised by the
Authority. The Authority agrees that any information obtained by it and not
available to the public will be kept confidential to the extent permitted
pursuant to 10 MRSA ss. 975-A and 1 MRSA ss. 401, et seq.
Section 2.10. Compliance with Law. The Guarantor will observe and
comply in all material respects with all material laws, regulations, ordinances,
rules, and orders (including without limitation those relating to zoning, land
use, environmental protection, air, water and land pollution, wetlands, health,
equal opportunity, minimum wages, worker's compensation and employment
practices) of any federal, state, municipal or other governmental authority the
noncompliance of which would have a material adverse effect on the financial
condition of the Guarantor.
ARTICLE III
EVENTS OF DEFAULT AND REMEDIES
Section 3.1. Events of Default. An "Event of Default" hereunder shall
exist if any of the following occurs and is continuing:
(1) the Guarantor defaults on the Obligations referred to in
Section 2.1 hereof and such default continues for more than, two (2) Business
Days after demand is made by the Trustee;
(2) the Guarantor fails to observe and perform any covenant,
condition or agreement, other than that referred to in Sections 3.1(1) of this
Guaranty, or of any instrument,
Page 7
8
document or agreement now or hereafter securing this Guaranty and such failure
continues for more than thirty (30) days after written notice (which shall be
deemed given upon facsimile transmission or three (3) Business Days after
mailing of notice by first class mail, postage prepaid or certified mail) of
such failure has been given to the Guarantor by the Trustee or if by reason of
such default the same cannot be remedied within said thirty (30) days;
(3) any warranty, representation or other statement by or on
behalf of the Guarantor contained in this Guaranty or in any certificate, letter
or other writing or instrument furnished or delivered to the Authority pursuant
hereto or in connection herewith and in connection with the Financing Documents
shall at any time prove to have been incorrect in any material respect when
made, effective, or reaffirmed, as the case may be;
(4) the entry of a decree or order for relief by a court
having jurisdiction of the Guarantor in an involuntary case under the federal
bankruptcy laws, as now or hereafter constituted, or any other applicable
federal or state bankruptcy, insolvency or other similar law, or appointing a
receiver, liquidator, assignee, custodian, trustee (or similar official) of the
Guarantor or for any substantial part of any of its property, or ordering the
winding-up or liquidation of any of its affairs and the continuance of any such
decree or order unstayed and in effect for a period of sixty (60) consecutive
days, or the commencement by the Guarantor of a voluntary case under the federal
bankruptcy laws, as now constituted or hereafter amended, or any other
applicable federal or state bankruptcy insolvency or other similar law, or the
consent by the Guarantor to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian (or other similar official)
or the making by it of any assignment for the benefit of creditors, or the
taking of corporate or other action by the Guarantor to authorize or effect any
of the foregoing;
(5) A final and unappealable judgment or order for the payment
for money in excess of $1,000,000 or more shall be rendered against the
Guarantor, such judgment or order shall continue unsatisfied and unpaid for a
period of thirty (30) days.
Section 3.2. Remedies Upon Default. Upon an Event of Default under
Section 3.1 of this Guaranty, the Trustee shall have the right to proceed
directly against the Guarantor without proceeding against or exhausting any
other remedies which it may have and without resorting to any security held
including, without limitation the Capital Reserve Fund.
Section 3.3. [Reserved]
Section 3.4. Waiver of Notice of Non-Payment and Costs of Enforcement.
The Guarantor hereby expressly waives presentment, demand, protest and notice of
nonpayment and further waives notice from the Authority of its acceptance and
reliance on this Guaranty. The Guarantor agrees to pay all costs, disbursements
and expenses (including all reasonable attorneys' fees) which may be incurred by
the Authority in enforcing or attempting to enforce this Guaranty and any
security therefor following any default on the part of the Guarantor hereunder,
whether the same shall be enforced by suit or otherwise.
Section 3.5. The Authority Not Coguarantor. The Guarantor hereby
acknowledges that (a) the Authority has established a Capital Reserve Fund under
the Indenture in order to provide credit
Page 8
9
enhancement for the 1998 Bonds; (b) the Authority is not a coguarantor with the
Guarantor, who shall have no right of contribution, indemnity or subrogation
against the Authority; (c) all liability of the Guarantor under this Guaranty
shall continue in full force and effect notwithstanding any payment by the
Authority in the form of draws by the Trustee from the Capital Reserve Fund
under the Indenture or payments by Financial Security Assurance Inc. under the
Bond Insurance Policy provided to insure the 1998 Bonds or otherwise; and (d)
all liability of the Guarantor under this Guaranty shall continue in full force
and effect notwithstanding the fact that the Authority may have acquired rights
against the Guarantor by assignment, subrogation or otherwise.
ARTICLE IV
MISCELLANEOUS
Section 5.1. Amendment. This Guaranty may not be amended, changed,
modified, altered or terminated without the concurring written consent of the
Guarantor and the Authority.
Section 5.2. Effective Date. The obligations of the Guarantor hereunder
shall arise absolutely and unconditionally when the Loan Note shall have been
executed by the Borrower.
Section 5.3. Remedies Not Exclusive. No remedy herein conferred upon or
reserved to the Trustee is intended to be exclusive of any other available
remedy or remedies, but each and every such remedy shall be cumulative and shall
be in addition to every other remedy given under this Guaranty or now or
hereafter existing at law or in equity. No delay or omission to exercise any
right or power accruing upon any Event of Default shall impair any such right or
power or shall be construed to be a waiver in the event any provision contained
in this Guaranty should be breached by any party and thereafter duly waived by
any other party so empowered to act. Such waiver shall be limited to the
particular breach so waived and shall not be deemed to waive any other breach
hereunder. No waiver, amendment, release or modification of this Guaranty shall
be established by conduct, custom or course of dealing, but solely by an
instrument in writing duly executed by the parties thereunto duly authorized by
this Guaranty.
Section 5.4. Notice. Except as otherwise provided herein, all notices
or other communications hereunder shall be sufficiently given and shall be
deemed given when delivered by hand delivery or on the third day following the
day on which the same has been mailed, postage prepaid, by certified mail
addressed as follows:
if to Guarantor:
KTI, Inc.
7000 Boulevard East
Guttenberg, NJ 07093
Attention: Martin J. Sergi, President
Fax: (201) 854-1771
Page 9
10
if to the Trustee:
The Chase Manhattan Bank
73 Tremont Street
Boston, MA 02108-3913
Fax:
Any party, by notice given hereunder, may designate a different address
for future notices.
Section 5.5. Counterparts. This Guaranty constitutes the entire
agreement, and supersedes all prior agreements and understandings, both written
and oral, between the parties with respect to the subject matter hereof and may
be executed simultaneously in several counterparts, each of which shall be
deemed an original and all of which together shall constitute one and the same
instrument.
Section 5.6. Severability. The invalidity or unenforceability of any
one or more phrases, sentences, clauses, or Sections in this Guaranty contained,
shall not affect the validity or enforceability of the remaining portions of
this Guaranty, or any part thereof.
Section 5.7. Governing Law. This Guaranty shall be governed by and
construed in accordance with the laws of the State of Maine. The Guarantor and
the Trustee and their successors or assigns agree that any action hereunder may
be brought in the Federal Courts in the State of New York.
Section 5.8. Successors and Assigns. This Guaranty shall be binding
upon, inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns.
Section 5.9. Reinstatement of Obligation. The obligations of the
Guarantor under this Guaranty shall be reinstated to the extent of any payment
made by the Borrower which must be returned by reason of the bankruptcy or
insolvency of the Borrower or for any other reason, subject to the limitations
contained in this Guaranty.
Section 5.10. Rules of Construction.
(A) Words of the neuter gender shall be deemed and construed to include
correlative words of the feminine and masculine genders.
(B) Unless the context shall otherwise indicate, the term Guarantor
shall include the plural as well as the singular number.
(C) Terms used and not defined herein shall have the meanings set forth
in the Agreement or in the Indenture to the extent such meaning is not
incompatible with the context used herein.
IN WITNESS WHEREOF, the Guarantor and the Trustee have caused this
Guaranty to be executed, all as of the date first above written.
Page 10
11
WITNESS: KTI, INC.
/s/ Suzanne VanDyk /s/ Martin J. Sergi
- ---------------------- ------------------------------------
By: Martin J. Sergi
Its: President
THE CHASE MANHATTAN BANK,
as trustee,
/s/ Mary Lou Bessey /s/ Don Iaccheri
- ---------------------- ------------------------------------
By: Don Iaccheri
Its: Authorized Signed
Page 11