1
Exhibit 4.2
SECOND AMENDED, RESTATED AND EXTENDED
WASTE DISPOSAL AGREEMENT
between
----------------------------------
(Municipality)
and
PENOBSCOT ENERGY RECOVERY COMPANY, LIMITED PARTNERSHIP
DATED: _____________________
2
TABLE OF CONTENTS
Article I Definitions .................................................. 3
Article II Representations, Warranties and Covenants..................... 10
Article III Operation of the Facility..................................... 13
Article IV Weighing ..................................................... 14
Article V Delivery of Waste to Company.................................. 16
Article VI Determination of Tipping Fee.................................. 20
Article VII Capital and Maintenance Reserve Account....................... 22
Article VIII Term of the Agreement, Termination............................ 27
Article IX Unacceptable and Hazardous Waste.............................. 30
Article X Suspension of Operations...................................... 31
Article XI Damage or Destruction......................................... 32
Article XII Municipal Review Committee.................................... 32
Article XIII Default; Liquidated Damages................................... 36
Article XIV Change in Law ................................................ 39
Article XV Force Majeure ................................................ 41
Article XVI Additional Remedies Upon Material, Adverse Changes............ 42
Article XVII Assignment.................................................... 46
Article XVIII Performance Credits........................................... 47
Article XIX Exercise of Option to Extend Term; Option To Purchase
Partnership Interests; Option To Purchase Limited
Partnership Interests ........................................ 51
Article XX Notices....................................................... 57
Article XXI Binding Effect ............................................... 58
Article XXII Other Documents............................................... 58
Article XXIII Headings...................................................... 58
Article XXIV Counterparts.................................................. 58
Article XXV Applicable Law ............................................... 59
Article XXVI Amendment of Agreement........................................ 59
Article XXVII Severability ................................................. 59
Article XXVIII Relationship of the Parties................................... 59
Article XXIX Representatives............................................... 59
Article XXX Integration; Conflicts........................................ 60
Article XXXI Consents...................................................... 60
Article XXXII Arbitration................................................... 60
-2-
3
Article XXXIII Miscellaneous ................................................ 61
Schedules
Schedule A Notices; Guaranteed Annual Tonnage.......................i
Schedule B Charter Municipalities and Reference GATs................ii
Schedule C Tipping Fee Calculation..................................vi
Schedule D Procedure To Exercise Option To Purchase Facility under
Article XVI, Paragraph A ...............................xii
Schedule E Distributable Cash.....................................xiii
Schedule F Performance Standards..................................xvii
Schedule G Types of Vehicles........................................xx
Schedule H [Deleted]
Schedule H1 [Deleted]
Schedule I [Deleted]
Schedule J Litigation and Governmental Proceeding Disclosure......xxiv
Schedule K [Deleted]
Acknowledgment of Bangor Hydro-Electric Company
Acknowledgment and Agreement of Municipal Review Committee, Inc.
-3-
4
SECOND AMENDED, RESTATED AND EXTENDED WASTE DISPOSAL AGREEMENT
This Second Amended, Restated and Extended Waste Disposal Agreement
(this "Agreement") is entered into in the State of Maine by and between
__________ ______________, Maine, a municipal corporation hereinafter called
"MUNICIPALITY"; and Penobscot Energy Recovery Company, Limited Partnership, a
Maine limited partnership hereinafter called "COMPANY," and amends, restates and
extends in its entirety that certain First Amended and Restated Waste Disposal
Agreement, between MUNICIPALITY and COMPANY, dated as of _________, 199_, as
heretofore amended and supplemented (as so amended and supplemented, the
"Outstanding Agreement").
WHEREAS, MUNICIPALITY is in need of a comprehensive, environmentally
sound, reliable, long-term management strategy for handling the present and
projected volumes of non-hazardous Solid Waste generated within MUNICIPALITY;
WHEREAS, it is the policy of the State of Maine to reduce the volume
of Solid Waste going into landfills, to recycle Solid Waste whenever possible
and to maximize resource recovery;
WHEREAS, improved waste management within the region of which
MUNICIPALITY is a part will serve the following goals:
1. Recovery of energy from waste;
2. Reduction in indiscriminate disposal of waste;
3. Coordination of Solid Waste management among political
subdivisions; and
4. Orderly and deliberate development of financially secure waste
facilities:
WHEREAS, State law requires each municipality to provide for
disposal facilities for domestic and commercial non-hazardous Solid Waste
generated within such municipality;
-4-
5
WHEREAS, Solid Waste issues present communities with serious
long-term financial, management, governmental and technical problems in the
disposal of Solid Waste;
WHEREAS, effective management of Solid Waste is crucial to the
continued financial well-being of MUNICIPALITY and the region of which it is a
part;
WHEREAS, COMPANY owns and operates a facility that recovers certain
recyclable materials and otherwise converts Solid Waste into energy in the Town
of Orrington, Penobscot County, Maine (as hereinafter defined, the "Facility");
WHEREAS, MUNICIPALITY is willing to assure the steady supply of
specified quantities of Solid Waste to the Facility for a fixed period; and
WHEREAS, approximately 130 communities delivering Solid Waste to
COMPANY (as hereinafter defined, the "Charter Municipalities") have so-called
"charter municipality" waste disposal agreements with COMPANY; and
WHEREAS, COMPANY and Bangor Hydro-Electric Company (as hereinafter
defined, "Bangor Hydro") have entered into a Power Purchase Agreement, as
amended, pursuant to which Bangor Hydro has agreed to purchase the electric
generating capacity of, and electric power generated at, the Facility; and
WHEREAS, Bangor Hydro desires to reduce the price for energy and
capacity as now provided for in the Power Purchase Agreement and has requested
that COMPANY amend the Power Purchase Agreement to reduce the burden on its
ratepayers; and
WHEREAS, to effect such amendment it is necessary to refinance the
outstanding indebtedness that financed the Facility as well as to amend the
outstanding "charter municipality" waste disposal agreements between COMPANY and
such charter municipalities (as hereinafter defined, the "Charter
Municipalities"); and
WHEREAS, MUNICIPALITY and other Charter Municipalities are members
of the Municipal Review Committee, Inc., which has engaged in discussions and
negotiations with Bangor Hydro and COMPANY on behalf of MUNICIPALITY and the
other Charter Municipalities, resulting in a plan to restructure the Power
Purchase Agreement and the
-5-
6
outstanding "charter municipality" waste disposal agreements and to refinance
the outstanding indebtedness that financed the Facility; and
WHEREAS, COMPANY seeks to amend, supplement and extend its existing
waste disposal agreement with MUNICIPALITY and substantially similar waste
disposal agreements with other Charter Municipalities it serves, and, for the
convenience of the parties, to restate such amended, supplemented and extended
agreements;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements hereinafter set forth, and other good and valuable consideration, the
receipt and sufficiency thereof being hereby acknowledged, MUNICIPALITY and
COMPANY hereby agree to amend, supplement and extend the Outstanding Agreement
and to restate the Outstanding Agreement as so amended, supplemented and
extended, as follows: ARTICLE I. DEFINITIONS
A. "Acceptable Waste" means [this definition to be adapted for each
Charter Municipality based on applicable provisions of its existing waste
disposal agreement] Solid Waste, including all ordinary household, municipal,
institutional, commercial and industrial wastes which consist primarily of
combustible materials, except for the following (unless Specially Permitted
Waste):
1. demolition or construction debris from building and roadway
projects or locations;
2. liquid wastes or sludges;
3. abandoned or junk vehicles;
4. Hazardous Waste;
5. dead animals or portions thereof or other pathological wastes;
6. water treatment facility residues;
7. tree stumps;
8. tannery sludge;
-6-
7
9. waste oil;
10. discarded "white goods" such as freezers, refrigerators,
washing machines, etc.;
11. waste which in the reasonable judgment of COMPANY'S weigh
station operator based solely upon a visual inspection has a
BTU content of less than 4000 BTU's per pound unless the waste
fails to meet the aforementioned BTU minimum requirement
solely because of the moisture content of such waste and such
moisture content is due to abnormally wet weather conditions;
Notwithstanding the above limitations, Acceptable Waste shall
include Specially Permitted Waste.
B. "Agreement" means this Second Amended, Restated and Extended
Waste Disposal Agreement (including Schedules attached hereto) between
MUNICIPALITY and COMPANY, as it may be amended or supplemented from time to time
in accordance with its terms.
C. "Amending Charter Municipality" means a Charter Municipality that
enters into a waste disposal agreement with COMPANY on terms substantially
similar to those contained in this Agreement on or before September 30, 1998.
Amending Charter Municipalities shall also include (i) those municipalities
which, with the prior approval of the Municipal Review Committee, enter into a
new waste disposal agreement with COMPANY and those municipalities which amend
and supplement their outstanding waste disposal agreements with COMPANY on terms
substantially similar to those contained in this Agreement after September 30,
1998 and before March 31, 2004, and (ii) those municipalities which after the
Closing Date enter into an agreement with COMPANY and are recognized by the
Municipal Review Committee and COMPANY as an Amending Charter Municipality
pursuant to Article VIII(C); provided, however, that Amending Charter
Municipalities described in clauses (i) and (ii) of this sentence shall not have
the rights of Amending Charter Municipalities to receive warrants for shares of
-7-
8
common stock of Bangor Hydro, as contemplated by Article XII, paragraph E, or to
purchase limited partnership interests in COMPANY, as contemplated by Article
XIX.
D. "Bangor Hydro" means Bangor Hydro-Electric Company, a Maine
corporation, or any permitted successors as Buyer under the Power Purchase
Agreement, dated as of June 21, 1984, as amended through Amendment No. 2, with
the COMPANY.
E. "By-Pass Waste" means all Acceptable Waste which COMPANY is
required but is unable to accept at the Facility.
F. "Capital and Maintenance Reserve Account" means the reserve
account established by COMPANY and more specifically described in Article VII.
G. "Change in Law" means those events described in Article XIV
hereof.
H. "Charter Municipality" means the MUNICIPALITY and each
municipality that is a party to a waste disposal agreement with COMPANY on terms
substantially similar to those contained in the Outstanding Agreement or this
Agreement, and which are listed and designated as such on Schedule B hereto, as
such schedule may be amended by COMPANY upon the request of the Municipal Review
Committee from time to time in accordance with the provisions of Article V,
paragraph F.
I. "Closing Date" means the date on which refunding bonds are issued
by the Finance Authority of Maine, or other issuer, and funds are made available
to COMPANY to redeem all of the outstanding bonds issued by the Town of
Orrington, Maine, to finance the Facility, and Bangor Hydro and COMPANY shall
have executed and delivered Amendment No. 2 to the Power Purchase Agreement with
COMPANY, Bangor Hydro and the other parties thereto shall have executed and
delivered the warrant agreement referenced in Article XII, paragraph E, and the
parties to the Trust Agreement shall have executed and delivered the Trust
Agreement.
J. "COMPANY" means Penobscot Energy Recovery Company, Limited
Partnership, a Maine limited partnership, or any successor thereto or assign
thereof as permitted by this Agreement.
-8-
9
K. "CPI-U" means the Consumer Price Index-All Urban Consumers (U.S.
cities average, all items) as published bi-monthly by the United States Bureau
of Labor Statistics in a report currently entitled "CPI Detailed Report." If
this index ceases to be published, a comparable index shall be designated by
agreement of COMPANY and the Municipal Review Committee.
L. "Delivery Hours" means a minimum of not less than eight (8) hours
per day Monday through Saturday, certain specified holidays excluded, during
which deliveries of Acceptable Waste, will be normally accepted at the Facility.
Such hours shall be determined by COMPANY with due consideration to be given to
the needs of MUNICIPALITY and the concerns of the Host Municipality. Delivery
Hours may be suspended by COMPANY due to a Suspension of Operations, hazardous
conditions or lawful orders to do so.
M. "District" means the Penobscot Valley Refuse Disposal District or
any other successor district which may be formed to exercise some or all of the
powers of said district or those powers which are conferred upon municipalities
pursuant to 38 M.R.S.A. Chapter 17.
N. "Equity Charter Municipality" means an Amending Charter
Municipality that timely exercises the option to participate in the purchase of
a limited partnership interest in COMPANY granted in Article XIX, paragraph C.
O. "Facility" means the waste to energy facility owned by COMPANY in
Orrington designed to convert Acceptable Waste into electrical and/or steam
energy.
P. "FEPR" means front end processing residue, including glass, grit,
ferrous metals and other non-processible material removed from the waste stream
prior to combustion.
Q. "Force Majeure Event" means an act of God, act of public enemy,
war, earthquake, storm, flood, and other causes not reasonably within the
control of any party invoking Article XV for its benefits.
-9-
10
R. "Guaranteed Annual Tonnage" means the number of tons of
Acceptable Waste that originates within its boundaries which MUNICIPALITY
guarantees to deliver to the Facility during the Operating Year (as initially
set forth on Schedule A attached hereto), as such number of tons may be adjusted
pursuant to Article V hereof.
S. "Guaranteed Plant Capacity Share" means a number of tons of
Acceptable Waste equal to 125% of MUNICIPALITY's Guaranteed Annual Tonnage as in
effect with respect to MUNICIPALITY in any Operating Year, which COMPANY is
required to accept from MUNICIPALITY during such Operating Year.
T. "Hazardous Waste" means waste with inherent properties which make
such waste dangerous to manage by ordinary means, including, but not limited to,
chemicals, explosives, pathological wastes, radioactive wastes, toxic wastes and
other wastes defined as hazardous at any time during the term of this Agreement
by the State of Maine or the Resource Conservation and Recovery Act of 1976 as
amended, or other Federal, State or local laws, regulations, orders, or other
actions promulgated or taken with respect thereto.
U. "Host Municipality" means the municipality of Orrington,
Penobscot County, Maine which is not a Charter Municipality.
V. "MRC Administration Authorization" means the bylaws of the
Municipal Review Committee, as amended and restated and in effect on the Closing
Date, which govern the rights and obligations of the Municipal Review Committee
in its capacity as advisor or agent to the Amending Charter Municipalities in
respect of all or certain of its duties under this Agreement and other
agreements contemplated by this Agreement, including Articles XII and XIX of
this Agreement, as such bylaws may be amended or supplemented from time to time,
or any successor or supplemental agreement between the Municipal Review
Committee and the Amending Charter Municipalities.
W. "Municipal Review Committee" means the Municipal Review
Committee, Inc., a nonprofit corporation organized under the laws of the State
of Maine, or any
-10-
11
successor entity operating as the Municipal Review Committee as described in
Article XII as the same may be constituted from time to time.
X. "Operating Year" means a twelve (12) month period of Facility
operation beginning January 1 and concluding December 31.
Y. "Outstanding Agreement" means the existing First Amended and
Restated Waste Disposal Agreement, dated _______________, 199_, between
MUNICIPALITY and COMPANY, as such had been heretofore amended and supplemented.
Z. "Pass-through Cost" has the meaning given in Paragraph B of
Schedule C to this Agreement.
AA. "Reference GAT" means, with respect to a Charter Municipality
and as of the date of determination, the Guaranteed Annual Tonnage set forth
opposite such Charter Municipality on Schedule B, which initially is the
Guaranteed Annual Tonnage of such Charter Municipality as of March 31, 1995, as
such may be amended from time to time in accordance with the provisions of
Article V, paragraph F.
BB. "Residue" means materials (including, but not limited to, bottom
ash, fly ash, and solids from emission control equipment) remaining after
processing of Acceptable Waste at the Facility.
CC. "Solid Waste" means non-hazardous solid materials with
insufficient liquid content to be free-flowing which are of no value to the
immediate source from which they emanate as evidenced by their disposal,
discard, or abandonment without consideration in return, including, but not
limited to, rubbish, sludge from a wastewater treatment plant, scrap materials,
junk, and refuse, but excluding septic tank sludge and agricultural waste. The
fact that value may be derived from such solid materials by recycling,
reprocessing, or other method of resource recovery shall have no bearing upon
their classification as "Solid Waste."
DD. "Specially Permitted Waste" means Unacceptable Waste which
COMPANY by written addendum to this Agreement agrees to accept at the Facility
to the extent that efficient operation of
-11-
12
the Facility will permit, subject to such conditions and limitations as may be
imposed by COMPANY.
EE. "Spot Market Contract" means a written or oral agreement for not
more than one (1) year between COMPANY and an entity, municipal or
non-municipal, allowing deliveries of Acceptable Waste on an interruptible basis
at COMPANY's option in each case, pursuant to which said entity has the right to
deliver Acceptable Waste to the Facility, and COMPANY agrees to accept such
Acceptable Waste, subject to interruption, or termination at the COMPANY's sole
discretion.
FF. "Supplemental Fuel" means, oil, coal, natural gas, wood chips,
other biomass, tires, or any other fuel burned or consumed in the Facility's
combustion units as a supplement to Acceptable Waste, excluding oil burned
during a start up or shut down of the Facility.
GG. "Suspension of Operations" means the suspension of the
Facility's operation for a temporary period to allow for repairs, maintenance,
retrofitting, change in law modifications and regulatory compliance during which
COMPANY is unable to accept delivery of Acceptable Waste at the Facility.
HH. "Termination of Operations" means the termination of the
Facility's operation with no apparent intention or ability to resume operation.
II. "Tipping Fee" means the payments required to be made by
MUNICIPALITY to COMPANY for processing Acceptable Waste at the Facility,
diverting By-Pass Waste to another location at the COMPANY's cost or as
otherwise provided for in this Agreement.
JJ. "Trust Agreement" means the [Trust Agreement] to be entered into
between COMPANY and a trustee, pursuant to which a trust is established to
receive all revenues of the Facility and to distribute the same as therein
provided.
KK. "Unacceptable Waste" means all Solid Waste that is not
Acceptable Waste.
-12-
13
ARTICLE II. REPRESENTATIONS, WARRANTIES AND COVENANTS
A. COMPANY warrants and represents to MUNICIPALITY the following:
1. COMPANY is a limited partnership duly organized and validly
existing under the laws of the State of Maine in good standing, and authorized
to do business under the laws of the State of Maine and that it has full power
and authority to execute and to enter into this Agreement and is qualified to
perform this Agreement in accordance with its terms.
2. The execution and delivery of this Agreement by COMPANY has
been duly authorized by all appropriate partnership actions and this Agreement
constitutes the legal, valid and binding obligation of COMPANY enforceable in
accordance with its terms (except as enforceability may be limited by applicable
bankruptcy or similar laws affecting creditor's rights and by application of
equitable principles if equitable remedies are sought).
3. Assuming the redemption of all Town of Orrington bonds and
cancellation of the letter of credit supporting such bonds, the execution,
delivery and performance of this Agreement by COMPANY will not violate any
provision of law, any order of any court or other agency of government, the
Agreement of Limited Partnership of COMPANY, as amended, supplemented and
restated, or any indenture, material agreement or other instrument to which
COMPANY is now a party or by which it or any of its properties or assets is
bound, or be in conflict with, result in a breach of or constitute a default
(with due notice of the passage of time or both) under any such indenture,
agreement or other instrument, or result in the creation or imposition of any
lien, charge or encumbrance of any nature whatsoever upon any of the properties
or assets of COMPANY.
4. Except as set forth on Schedule J, to the best of its
knowledge, there is no pending or threatened litigation or governmental
proceeding which would adversely affect COMPANY's ability to operate the
Facility or would affect its ability to perform its obligations under this
Agreement.
-13-
14
5. Each general partner of COMPANY is either a limited
partnership or corporation duly organized and validly existing under the laws of
the State of its organization in good standing and qualified to do business in
the State of Maine, and has the power to enter into, and had duly authorized by
proper action the execution and delivery of, this Agreement as general partner
on behalf of COMPANY. The execution and delivery of this Agreement by such
general partners of COMPANY and performance of this Agreement by such general
partners of COMPANY and performance of this Agreement by COMPANY will not (i)
violate any provision of law or any order of any court or other agency of
government applicable to such general partner, (ii) violate the organizational
documents of such general partner, or (iii) be in conflict with, result in a
breach of, or constitute a default (with due notice or the passage of time or
both) under any such material indenture, agreement or other instrument to which
such general partner is now a party or by which it or any of its properties or
assets is bound.
6. COMPANY shall provide to MUNICIPALITY an opinion of its
legal counsel to the effect of Paragraphs 1 through 5.
B. MUNICIPALITY warrants and represents to COMPANY each of the
following:
1. The execution and delivery of this Agreement has been duly
authorized by all appropriate actions of MUNICIPALITY'S governing body, and this
Agreement constitutes the legal, valid and binding obligations of MUNICIPALITY
enforceable in accordance with its terms (except as enforceability may be
limited by applicable bankruptcy or similar laws affecting creditors' rights,
and by application of equitable principles if equitable remedies are sought).
2. To the best of its knowledge, there is no pending or
threatened litigation or governmental proceedings which would affect its ability
to perform its obligations under this Agreement.
3. MUNICIPALITY shall provide to COMPANY (and if COMPANY
requests, to any financial institution providing financing for the Facility or
credit
-14-
15
support for any refinancing of the Facility) an opinion of its legal counsel to
the effect of Paragraphs 1 through 2.
ARTICLE III. OPERATION OF THE FACILITY
A. COMPANY shall, except as otherwise expressly provided for herein:
1. Either operate and maintain the Facility so as to be
capable of receiving and combusting Acceptable Waste in quantities up to the
aggregate Guaranteed Plant Capacity Shares of all Charter Municipalities or
arrange for the disposal of such Acceptable Waste in the manner provided herein
for By-Pass Waste; provided, however, that COMPANY shall in no event be
obligated to accept or process Unacceptable Waste; and
2. Require any operator of the Facility (including COMPANY, if
applicable) to operate the Facility in accordance with standards that are not
lower than the General Duties (as that term is defined in the current Operations
and Maintenance Agreement between COMPANY and ESOCO Orrington, Inc.).
B. COMPANY shall use reasonable efforts to maintain the Facility in
a manner which will minimize any adverse impact upon residents of the
surrounding area, including the following:
1. all waste and waste by products shall be screened from
public view by natural buffers or man-made barriers;
2. vehicular access to the Facility shall be restricted during
non-Delivery Hours;
3. the premises of the Facility, except for storage areas,
shall be kept reasonably free of litter and other debris other than in its
designated location; and
4. roads on the premises of the Facility shall be kept in good
order and repair.
C. COMPANY shall accept Acceptable Waste at the Facility during
Delivery Hours only, except that if in the event of a natural disaster or other
emergency condition, MUNICIPALITY requests COMPANY to accept Acceptable Waste
outside of Delivery Hours,
-15-
16
COMPANY shall make a reasonable effort to accommodate MUNICIPALITY's request
provided MUNICIPALITY agrees to pay any additional expenses that COMPANY may
incur in accommodating such request. If COMPANY determines that it is not able
to accommodate such request, its determination shall be final. In case of such a
determination, COMPANY will make a reasonable effort to locate an alternative
disposal or storage site for such Acceptable Waste.
D. The marketing of energy products and materials produced by the
Facility, including the pricing thereof, shall be sole and exclusive prerogative
of COMPANY and COMPANY, except as otherwise set forth herein shall be
exclusively entitled to any benefits derived from the sale of any materials it
may recover from Acceptable Waste.
E. COMPANY shall be responsible at its cost for disposing of all
Residue generated by the Facility and all By-Pass Waste except as otherwise
provided for in this Agreement but MUNICIPALITY shall bear all costs of
delivering waste to the Facility, including the costs of operating transfer
stations and all costs of removing any significant quantities of Unacceptable
Waste delivered to the Facility by MUNICIPALITY or its agents.
ARTICLE IV. WEIGHING
A. Except as otherwise provided herein, COMPANY shall operate and
maintain for use by MUNICIPALITY, a container and/or motor truck scale (or
scales) to weigh all vehicles of up to sixty (60) feet in length delivering
Acceptable Waste to the Facility for disposal. COMPANY shall provide for regular
inspections of the scale(s) by the appropriate public officials with
responsibility for certifying weights and measures to ensure their reasonable
accuracy, such inspection to be conducted not less than annually, and at such
other times as MUNICIPALITY at its expense deems necessary. COMPANY shall have
available a backup scale for use when installed scales are inoperative.
B. Deliveries by MUNICIPALITY shall be recorded separately. COMPANY
and MUNICIPALITY shall jointly establish reasonable procedures to ensure proper
vehicle identification and weighing of loads. Unless otherwise agreed, each
incoming and
-16-
17
outgoing waste vehicle shall be weighed with gross weight, time, and truck
identification indicated on a weigh record. MUNICIPALITY, COMPANY and operator
of each weighed vehicle shall receive a copy of the weigh ticket. Each weigh
ticket shall include at least the following information:
* Date and Time
* Hauler Code
* Vehicle I.D. number
* Tons delivered (to nearest hundredth of a ton)
COMPANY shall retain all weigh tickets for a period of not less than one year.
The weigh records shall be used by COMPANY and MUNICIPALITY as a basis for the
calculations required herein and shall be verified at least annually.
MUNICIPALITY shall have the right to inspect COMPANY's weigh records upon 24
hours prior written notice. Such inspections shall be conducted during business
hours in such a manner as to not unreasonably interfere with Facility
operations.
C. If all weighing facilities are inoperative or are being tested,
COMPANY shall estimate the quantity of waste delivered on the basis of truck
volumes and estimated data obtained through historical information pertinent to
MUNICIPALITY. These estimates shall take the place of actual weighing records
during the scale outage.
D. In the event Acceptable Waste is directed to another facility
under the provisions of this Agreement, the weight records of the place of
disposal, absent manifest error, shall be used to determine the tonnage of
Acceptable Waste for purposes of this Agreement.
E. COMPANY agrees to notify MUNICIPALITY and the Municipal Review
Committee of the amount of recycled waste delivered to the Facility that can be
credited toward its recycling goals for the purpose of compliance and reporting
under the Maine Comprehensive Solid Waste Act and to provide the Municipal
Review Committee on an annual basis the aggregate amount of such credited
recycled waste, to the extent allowed by the State Planning Office or any
successor.
-17-
18
ARTICLE V. DELIVERY OF WASTE TO COMPANY
A. MUNICIPALITY will use its best efforts to cause to be delivered
to the Facility in self discharging equipment of the general type specified in
Schedule G the Acceptable Waste collected by it and other Acceptable Waste under
its control up to its Guaranteed Plant Capacity Share and will adopt reasonable
measures to prevent the disposal of Unacceptable Waste at the Facility.
B. MUNICIPALITY shall use its best efforts to cause to be delivered
to the Facility the Acceptable Waste per operating month as shown on Schedule A.
C. COMPANY agrees that MUNICIPALITY may at its option, at any time
or from time to time during the term of this Agreement, if MUNICIPALITY is not
then in default hereunder, increase its Guaranteed Annual Tonnage (and, as a
consequence, its Guaranteed Plant Capacity Share) upon giving written notice
thereof to COMPANY; provided, however, that MUNICIPALITY may not, by the
exercise of the option granted in this paragraph C, increase its Guaranteed
Annual Tonnage to more than 125% of its Reference GAT. The increase in
Guaranteed Annual Tonnage shall take effect as of January 1 of the second
calendar year following the calendar year in which COMPANY receives written
notice from MUNICIPALITY of the increase.
D. COMPANY agrees that the Charter Municipalities may pool their
rights to increase their Guaranteed Annual Tonnage under paragraph C of this
Article V or similar provisions of other waste disposal agreements with COMPANY
(substantially similar to the Outstanding Agreement or this Agreement) so as to
permit any Charter Municipality, if it is not then in default under its waste
disposal agreement with COMPANY and subject to the prior written consent of the
Municipal Review Committee delivered to COMPANY, to increase its Guaranteed
Annual Tonnage to more than 125% of its Reference GAT then in effect; subject,
however, to the following conditions, which are hereby consented and agreed to
by MUNICIPALITY and the Municipal Review Committee:
-18-
19
1. Following such increase, the aggregate Guaranteed Annual
Tonnages of all Charter Municipalities shall not exceed 225,000
tons;
2. In the event of any such pooling, the right of an
individual Charter Municipality to increase its Guaranteed Annual
Tonnage by 125% of its Reference GAT then in effect shall be limited
to the extent necessary to assure that the aggregate Guaranteed
Annual Tonnages of all Charter Municipalities does not exceed
225,000 tons, with any conflicts among Charter Municipalities as to
the allocation among them of any necessary limitations to be
resolved by the Municipal Review Committee;
3. Following any such increase and on or before January 1,
2003, the Guaranteed Annual Tonnage of all Amending Charter
Municipalities in the aggregate shall not be less than 51% of the
Guaranteed Annual Tonnage of all Charter Municipalities in the
aggregate; and
4. The right of the Charter Municipalities, including
MUNICIPALITY, to increase its Guaranteed Annual Tonnage under this
paragraph D and COMPANY's obligation to accept increased tons of
waste shall at all times be governed by and subject to the waste
processing capacity of the Facility from time to time.
The increase in Guaranteed Annual Tonnage shall take effect as of January 1 of
the second calendar year following the calendar year in which COMPANY receives
written notice from the Municipal Review Committee of the increase.
E. MUNICIPALITY may at any time and from time to time, if it is not
then in default hereunder, and with the approval of the Municipal Review
Committee, decrease its Guaranteed Annual Tonnage (and its Reference GAT) for
purposes of this Agreement if one or more other Amending Charter Municipalities
increase their Guaranteed Annual Tonnages (and their Reference GATs) by the same
aggregate amount under their waste disposal agreements with COMPANY.
Correspondingly, MUNICIPALITY may increase its Guaranteed Annual Tonnage
-19-
20
hereunder (and its Reference GAT) by agreeing to increase its Guaranteed Annual
Tonnage in response in whole or in part to a corresponding decrease in the
Guaranteed Annual Tonnage (and Reference GAT) of one or more other Amending
Charter Municipalities under their waste disposal agreements with COMPANY. Any
such decreases and increases in Guaranteed Annual Tonnage (and Reference GAT)
shall be effected by delivery to COMPANY of written notice from the Municipal
Review Committee of the amount of such decreases and increases and the Amending
Charter Municipalities affected thereby. Such decreases and increases shall take
effect as of the January 1 of the calendar year next succeeding the calendar
year in which such notice is received by COMPANY if the notice is received
before September 1, or, if such notice is received by COMPANY on or after
September 1, as of January 1 of the second succeeding calendar year.
F. Following the effective date of increases or decreases in the
Guaranteed Annual Tonnage of MUNICIPALITY or any other Amending Charter
Municipality, as permitted by paragraph E, COMPANY shall promptly amend Schedule
B to this Agreement to reflect such increases and decreases in the Reference
GATs of the Amending Charter Municipalities and provide to the Municipal Review
Committee a copy thereof, and thereupon such Schedule B shall be amended for all
purposes of this Agreement. Furthermore, upon the addition of an Amending
Charter Municipality, COMPANY shall promptly amend Schedule B to this Agreement,
as requested by the Municipal Review Committee, to reflect such addition and
provide to the Municipal Review Committee a copy thereof, and thereupon such
Schedule B shall be amended for all purposes of this Agreement.
G. All Acceptable Waste delivered to the Facility by MUNICIPALITY or
directed to another facility during a Suspension of Operations shall be credited
toward MUNICIPALITY'S Guaranteed Annual Tonnage and all Acceptable Waste shall
become the property of COMPANY after it is delivered to the Facility.
H. For the duration of this Agreement, MUNICIPALITY shall be
obligated to deliver Acceptable Waste to COMPANY equal to its Guaranteed Annual
Tonnage or pay any amounts due under paragraph I of this Article. Only
Acceptable Waste which originates
-20-
21
from within MUNICIPALITY or, with the written consent of COMPANY, which
MUNICIPALITY otherwise causes to be so delivered, shall be delivered to the
Facility by or on behalf of MUNICIPALITY and credited towards its Guaranteed
Annual Tonnage. For purpose of determining whether MUNICIPALITY has met its
Guaranteed Annual Tonnage, no credit shall be given to MUNICIPALITY for
Acceptable Waste delivered to the Facility during the last month of the
Operating Year in excess of 150% of the normal monthly tonnage specified in
Schedule A unless such excess Acceptable Waste is actually processed by the
Facility.
I. On an Operating Year basis, if the aggregate amount of Acceptable
Waste credited during the Operating Year to all of the Charter Municipalities is
less than the aggregate Guaranteed Annual Tonnage of all Charter Municipalities
(for reasons other than Force Majeure or Termination of Operations), those
municipalities which did not meet their Guaranteed Annual Tonnage requirement
shall make a payment, as described below, based on their pro-rata share of the
shortfall in tonnage. The payment shall be calculated as follows: municipality's
pro-rata share of an additional fee for the shortfall computed by (i)
multiplying the aggregate shortfall in tonnage by the Tipping Fees (as
determined by taking the average Tipping Fee in effect during the Operating
Year) which the Charter Municipalities would have paid to COMPANY had the
Guaranteed Annual Tonnage of all Charter Municipalities been credited during the
Operating Year in question, and adding (ii) COMPANY's cost of purchasing
Supplemental Fuel equal in BTU value to the shortfall using the actual measured
BTU value per pound of Acceptable Waste over such Operating Year. This payment
shall be made not later than the March 1 or thirty (30) days after
reconciliation pursuant to Paragraph F of Schedule C next following the
Operating Year in which such shortfall in aggregate Charter Municipality
Guaranteed Annual tonnage was not delivered.
ARTICLE VI. DETERMINATION OF TIPPING FEE
A. Tipping Fees. From and after April 1, 1991, MUNICIPALITY shall
pay COMPANY a Tipping Fee calculated and adjusted as provided on Schedule C
attached hereto. The Tipping Fee payable to COMPANY shall be calculated by
multiplying the Tipping
-21-
22
Fee in effect during the period of deliveries of Acceptable Waste, by the number
of tons of Acceptable Waste that MUNICIPALITY caused to be delivered to Facility
or caused to be delivered to another waste facility at the direction of COMPANY,
which tonnage is based on weight records referred to in Article IV hereof, as
tallied and formulated into invoices on a monthly basis and submitted to
MUNICIPALITY by COMPANY.
B. Invoices; Payment. Payment of the Tipping Fees (and any other
amounts listed on the invoices) shall be made by MUNICIPALITY within thirty (30)
days of its receipt of said invoices. Any late payments shall bear interest at
lesser of 1.5% per month or the rate of interest announced by Bank of Boston or
its successor as its prime or base rate of interest, adjusted daily, plus 2% per
annum.
C. Components of Tipping Fee. The two components of the Tipping Fee
shall be first the Base Rate as defined on Schedule C, and second, the Variable
Rate as defined on Schedule C attached hereto. The Base Rate shall be adjusted
(up or down) on the first day of each January commencing with January 1, 1992 by
a percentage equal to the annual percentage change in the CPI-U as of the
immediately preceding September from that of the September of the prior year and
the Variable Rate shall be adjusted (up or down) quarterly commencing July 1,
1991 as set forth on Schedule C. The Tipping Fee to be paid by MUNICIPALITY
shall be adjusted in accordance with the terms of Schedule C attached hereto.
D. The provisions of this Agreement relating to payment of Tipping
Fees, Guaranteed Annual Tonnage and other requirements which are based upon an
Operating Year basis shall be modified to reflect the percentage of the year
during which the Facility operates or the percentage of the year after which
MUNICIPALITY begins delivery or the percentage of the year prior to a
termination. For this purpose, all Operating Year requirements to be adjusted
shall be multiplied by a fraction, the numerator of which is the number of
months during which the Facility has operated and fractions thereof and the
denominator of which is twelve (12).
-22-
23
E. COMPANY may add a surcharge on the Tipping Fee imposed by COMPANY
for delivery and acceptance of Specially Permitted Waste by MUNICIPALITY
provided that such surcharge shall not exceed an amount necessary to offset
COMPANY's incremental costs of handling and disposing of such Specially
Permitted Waste, and, if applicable, the lower BTU value of such Specially
Permitted Waste.
ARTICLE VII. CAPITAL AND MAINTENANCE RESERVE ACCOUNT
A. COMPANY has established and shall fund an account entitled the
Capital and Maintenance Reserve Account ("CMRA"). All amounts funded at any time
by COMPANY in the CMRA shall be held by Fleet Bank or its successor pursuant to
a Custodial Agreement, dated on or about June 13, 1991, and shall be used solely
for Capital or Maintenance Expenditures as defined in paragraph G of this
Article. MUNICIPALITY and the other Charter Municipalities shall be entitled to
a first possessory priority lien on amounts in the CMRA to secure the
performance by COMPANY of its obligations to MUNICIPALITY and the other Amending
Charter Municipalities pursuant to this Agreement and similar agreements and the
other Charter Municipalities pursuant to their respective Charter Municipality
agreements; provided, however, that no entity (including, without limitation,
MUNICIPALITY) other than the Municipal Review Committee shall be entitled to
enforce such lien on behalf of Charter Municipalities or to effect any set-off
against amounts held in such Account.
B. There shall be paid into the CMRA during each Operating Year from
payment of the Tipping Fees paid by MUNICIPALITY and other Charter
Municipalities an amount equal to the Monthly Reserve Fund Amount, which is
defined and computed pursuant to paragraph C of this Article.
C. The Monthly Reserve Fund Amount shall be calculated as follows:
(i) for each Operating Year commencing April 1, 1991, a
deposit of $116,667 per month (or a fraction thereof as described below),
adjusted up or down as of the first day of each Operating Year commencing on or
after January 1, 1992 by a percentage equal to the
-23-
24
percentage change in the CPI-U for September 30 of the immediately preceding
Operating Year as compared to the CPI-U for April 1991. (Until the aggregate
Guaranteed Annual Tonnage of MUNICIPALITY and all other Charter Municipalities
("Charter Tonnage") reaches 216,480 tons per year, the deposit of $116,667 per
month, as adjusted, shall be reduced to an amount that is determined by
multiplying $116,667 by a fraction, the numerator of which is the Charter
Tonnage and the denominator of which is 216,480 tons); and
(ii) in the event that in the judgment of COMPANY, consistent
with paragraph H, the amount in the CMRA at the end of any Operating Year will
exceed $5 million, COMPANY will, as of the beginning of such Operating Year,
reduce the Base Rate portion of the Tipping Fee for that Operating Year by an
aggregate amount equal to the amount of such excess. Such Base Rate reduction
will be calculated on a per ton of Acceptable Waste basis based on the aggregate
Guaranteed Annual Tonnage of all Charter Municipalities applicable to such
Operating Year. COMPANY shall also reduce the Monthly Reserve Fund Amount for
such Operating Year by an amount equal to the amount of such excess, divided by
twelve (12).
D. The failure of COMPANY to deposit in any year or month in the
CMRA any amounts required to be deposited therein by it by reason of the failure
of MUNICIPALITY or any Charter Municipality to pay any amounts due COMPANY shall
not constitute a default by COMPANY of any of its obligations under this Article
VII.
E. All monies in the CMRA shall be invested and reinvested in such
obligations issued or guaranteed by the United States of America as the
Custodian shall determine. The Custodian shall not be liable or responsible for
any depreciation of the value of any investment made by it. Interest earned or
accrued on any monies or investments in the CMRA shall be held in and credited
to the CMRA for the purposes thereof.
F. COMPANY shall be entitled to withdraw from the CMRA those amounts
determined by it at the time of such withdrawal, to pay, or to reimburse itself
for, any Capital or Maintenance Expenditures paid or incurred by it in the
Operating Year in which such Capital or Maintenance Expenditure is made. When
COMPANY withdraws funds from the
-24-
25
CMRA, it shall furnish a statement to the Municipal Review Committee certifying
that the funds withdrawn are for Capital or Maintenance Expenditures, including
a description of the expenditure and substantiation of the costs. If COMPANY
withdraws funds from the CMRA due to an event covered by an insurance policy or
subject to a warranty or third party claim, COMPANY will use good faith efforts
to recover any amounts owed, and deposit into the CMRA any insurance proceeds it
recovers or damages it collects, minus reasonable expenses incurred (including
any attorneys fees) by COMPANY.
G. "Capital or Maintenance Expenditures" shall consist only of those
costs, fees, expenses and liabilities paid by or incurred by COMPANY in the
construction, acquisition, operation or maintenance of the Facility for Capital
or Maintenance Expenditures. Capital or Maintenance Expenditures shall not
include such costs, fees, expenses and liabilities paid or incurred as a result
of a Change-in-Law which are included in the full amount thereof as a
Change-in-Law cost for purposes of computing the Variable Rate. "Capital
Expenditures" means only those amounts recorded in accordance with Generally
Accepted Accounting Principles ("GAAP") in respect of any period by COMPANY for
the purchase or acquisition for value of fixed or capital assets for the
Facility. "Maintenance Expenditures" means all expenditures for repairs or
modifications to existing equipment whether or not due to normal wear and tear
to the Facility or maintenance work performed spontaneously during the operation
of the Facility, in excess of $20,000 individually for any one item or in the
aggregate for any series of related items. Maintenance Expenditures shall not
include items included as "Scheduled Maintenance" on COMPANY's annual budget
which includes quarterly boiler grate cleaning and annual minor turbine
inspections.
H. As part of the annual budget to be prepared by COMPANY and
submitted to the Municipal Review Committee, COMPANY will show projected uses,
to the extent then known, of the CMRA for the next Operating Year.
I. If as of May 10, August 10, November 10 or February 10, the
cumulative amounts of money deposited in the CMRA in the first quarter, second
quarter, third
-25-
26
quarter or fourth quarter, respectively, of any Operating Year are less than the
cumulative amounts of money that should have been deposited in the CMRA in said
quarter ("Cumulative CMRA Shortfall"), and if COMPANY within twenty (20) days
next following either May 10, August 10, November 10 or February 10, as the case
may be, does not fund the Cumulative CMRA Shortfall, then Charter Municipalities
may withhold from their future monthly Tipping Fee payments an amount up to the
Cumulative CMRA Shortfall. The Municipal Review Committee shall determine the
amount to be withheld by each Charter Municipality, including MUNICIPALITY,
which amount along with that portion of the then current Tipping Fee
attributable to MUNICIPALITY's contribution to the CMRA (the "CMRA Account
Payment") as determined by the Municipal Review Committee shall be paid to the
Municipal Review Committee to be held in escrow. The CMRA Account Payments may
be withheld in escrow only to the extent and only as long as any portion of the
Cumulative CMRA shortfall remains. Once the Cumulative CMRA Shortfall has been
paid into the CMRA account, the Municipal Review Committee shall within two (2)
days release the CMRA Account Payments in escrow to COMPANY for deposit in the
CMRA; provided, however, if COMPANY cures any shortfalls to the extent that the
release of any money from escrow would bring the amount current, said money
shall be released.
J. If pursuant to Article VIII(C), this Agreement is terminated
prior to March 31, 2018, the balance (if any) in the CMRA as of the date of
termination shall be distributed to COMPANY and MUNICIPALITY (and other Charter
Municipalities whose agreements will similarly be terminated) as follows: a pro
rata share, based on the proportion of COMPANY's contributions to CMRA to the
Charter Municipalities' contributions to the CMRA, with COMPANY's proportionate
share to be paid to COMPANY and the Charter Municipalities' share to be divided
among the Charter Municipalities as determined by the Municipal Review
Committee.
K. Notwithstanding any provision of this Agreement to the contrary,
a pro rata share, based on the proportion of the Reference GAT of MUNICIPALITY
to the
-26-
27
aggregate Reference GATs for all Charter Municipalities, of the balance (if any)
remaining in the CMRA shall be paid to MUNICIPALITY if this Agreement is in full
force and effect on March 31, 2018 and MUNICIPALITY is not then in default
hereunder. COMPANY shall be entitled to all amounts that otherwise would have
been allocable to Charter Municipalities which terminated their respective
agreements effective prior to March 31, 2018.
ARTICLE VIII. TERM OF AGREEMENT; TERMINATION
A. The term of this Agreement, as it extends the term of the
Outstanding Agreement (which began on April 1, 1991), shall be from the Closing
Date through March 31, 2018, unless earlier terminated as herein provided.
B. [Intentionally Reserved]
C. If as a result of a termination notice or notices received by
COMPANY from Charter Municipalities that are not Amending Charter
Municipalities, the aggregate Guaranteed Annual Tonnage of nonterminating
Charter Municipalities (based upon Guaranteed Annual Tonnage in effect at the
time of giving of such notice(s)), together with the tonnage of all other
municipalities delivering waste under long-term waste disposal agreements with
COMPANY, will fall below 155,000 tons after the effective date of such
termination, COMPANY may elect to terminate all of the Charter Municipality
agreements, including this Agreement. If COMPANY makes this election, all then
effective Charter Municipality agreements shall terminate on either March 31,
2000, March 31, 2002, or March 31, 2004, as the case may be, unless before
either March 31, 2000, March 31, 2002, or March 31, 2004, as the case may be,
the non-terminating Charter Municipalities exercise any one of the following
options.
COMPANY shall promptly provide to the Municipal Review Committee
copies of termination notices from Charter Municipalities that are not Amending
Charter Municipalities and a statement as to the amount of the Charter
Municipality aggregate Guaranteed Annual Tonnage capacity (if any) made
available as a result of the notices and the amount of the shortfall below
155,000 tons created as a result of each such notice. The Municipal Review
-27-
28
Committee will have one hundred and twenty (120) days to exercise either an
option (1) to arrange for a reallocation of the Guaranteed Annual Tonnage
capacity created as a result of the notices or (2) to arrange for Guaranteed
Annual Tonnage under a substitute waste disposal agreement containing the same
terms as this Agreement. If the Municipal Review Committee exercises all or a
portion of the first option, it shall notify COMPANY and Charter Municipalities
as to which Charter Municipalities the capacity shall be allocated, to be
effective on the effective date of the applicable termination and said notice(s)
shall constitute an increase to that Municipality's Guaranteed Annual Tonnage;
provided, however, no such reallocation on or before January 1, 2003 shall cause
the aggregate Guaranteed Annual Tonnage of all Amending Charter Municipalities
to be less than 51% of the aggregate Guaranteed Annual Tonnage of all Charter
Municipalities. If the Municipal Review Committee exercises all or a portion of
the second option, then the municipality entering into the substitute waste
disposal agreement shall be an Amending Charter Municipality and the effective
date of its agreement shall be the same as the effective date of the applicable
termination; provided, however, that such Amending Charter Municipality shall
not have rights of Amending Charter Municipalities to receive warrants for
shares of common stock of Bangor Hydro, as contemplated by Article XII,
paragraph E, or to purchase limited partnership interests in COMPANY, as
contemplated by Article XIX. COMPANY will cooperate with the Municipal Review
Committee in its efforts to obtain replacement tonnage. The Municipal Review
Committee can only obtain replacement tonnage in order to meet the 155,000 ton
minimum or such greater amount of Guaranteed Annual Tonnage as COMPANY may
approve in writing. If as a result of the exercise of this option, the aggregate
Guaranteed Annual Tonnage of the remaining Charter Municipalities, together with
the tonnage of all other municipalities delivering waste under long-term waste
disposal agreements with COMPANY, meets or exceeds 155,000 tons as of the
effective date of the termination notices, COMPANY shall not have the right to
terminate the remaining Charter Municipality agreements under this paragraph C.
-28-
29
Notwithstanding the immediately preceding paragraph, COMPANY shall
not have the right to terminate the remaining Charter Municipality agreements,
including this Agreement, under this paragraph C if (i) the Municipal Review
Committee causes to be paid to COMPANY the full amount of Tipping Fees that
would otherwise have been payable under the Charter Municipality agreements and
in the same manner as the put-pay obligations are paid in this Agreement, as if
the aggregate Guaranteed Annual Tonnage under such Charter Municipality
agreements were 155,000 tons, and (ii) the aggregate Guaranteed Annual Tonnage
under all Charter Municipality agreements then in effect is not less than
140,000 tons.
In consideration of the option granted to the Municipal Review
Committee in this paragraph C, the Municipal Review Committee agrees that it
shall continue to consent to COMPANY entering into long-term waste disposal
agreements on terms substantially similar to those contained in this Agreement
with any municipality other than the City of Xxxxxxxxx and the Towns of Newport,
Pittsfield, Detroit, Monroe, Prospect, Winterport and Frankfort, Maine, to which
the Municipal Review Committee has otherwise consented until a total of 180,000
tons of Guaranteed Annual Tonnage has been achieved and, thereafter, in order to
maintain at least 180,000 tons of Guaranteed Annual Tonnage. The option granted
to the Municipal Review Committee in this paragraph C is further conditioned on
and shall remain effective only so long as no Charter Municipality has filed a
civil action or initiated an arbitration proceeding against COMPANY alleging or
based upon an infirmity in the Municipal Review Committee's consent or a
violation or breach of Article XXXIII of this Agreement or the other Charter
Municipality agreements; provided that COMPANY may waive this limitation on the
effectiveness of such amendments.
D. [Intentionally reserved]
E. No termination of this Agreement shall relieve MUNICIPALITY of
its obligation to make any Tipping Fee payments (including any remaining
balances of Change-in-Law costs as set forth in Schedule C) or either party of
any indemnity or payment obligations with respect to waste delivered or matters
occurring on or before the effective date of termination
-29-
30
hereunder, and upon termination, MUNICIPALITY and COMPANY shall execute a mutual
release of the other with only such exceptions specified in this paragraph E.
ARTICLE IX. UNACCEPTABLE AND HAZARDOUS WASTE
Unacceptable Waste shall be handled in the following manner:
A. COMPANY's weigh station operator shall have authority to reject
all loads of waste delivered to the Facility on behalf of MUNICIPALITY which
have significant amounts of Unacceptable Waste. The determination of the weigh
station operator or other agent of COMPANY, if made in good faith, shall be
binding on MUNICIPALITY. COMPANY shall immediately notify the MUNICIPALITY of
any rejected loads and shall provide to it particulars about the hauler, the
reason for rejection and the information on the weight ticket provided for by
Article IV hereof, for that rejected load. MUNICIPALITY shall notify all haulers
delivering waste on its behalf of what constitutes Unacceptable Waste.
B. Subject to the provisions of paragraph A, COMPANY shall not
knowingly permit any delivery by any person at the Facility of Hazardous Waste
or Unacceptable Waste. COMPANY shall exercise reasonable care in the
identification and extraction from the waste stream of Hazardous Waste and
Unacceptable Waste received at the Facility. If the probable source of the
Hazardous Waste or Unacceptable Waste can be identified as MUNICIPALITY,
MUNICIPALITY shall either immediately remove such waste from the Facility or
reimburse COMPANY for all costs incurred by the COMPANY in the required clean-up
of such waste.
ARTICLE X. SUSPENSION OF OPERATIONS
A. If a Suspension of Operations occurs, COMPANY shall promptly
advise MUNICIPALITY of such occurrence, its effect on the ability of COMPANY to
accept Acceptable Waste from MUNICIPALITY at the Facility and its probable
duration. During a Suspension of Operations COMPANY shall, in consideration of
the Tipping Fee, provide for and pay for the disposal of MUNICIPALITY's
Acceptable Waste and other Charter Municipalities' Acceptable Waste up to the
aggregate Guaranteed Plant Capacity Share of the Charter
-30-
31
Municipalities. COMPANY shall use its best efforts to resume normal operations
at the Facility at the earliest practicable time. So long as COMPANY meets its
obligations hereunder it shall not be deemed in default of this Agreement.
B. During a Suspension of Operations, COMPANY may require
MUNICIPALITY to deliver its Acceptable Waste to an alternative waste disposal
facility. COMPANY shall use its best efforts to arrange for said alternative
waste facility in close proximity to the Facility with due regard for costs of
each of the parties. COMPANY shall pay any incremental transportation costs
incurred by MUNICIPALITY or its members as a result of delivering By-Pass Waste
to such alternative waste disposal facility, but only if such alternative waste
disposal facility is located a distance greater than 10 miles radius from the
intersection of Union and Main Streets in Bangor. MUNICIPALITY'S incremental
transportation costs shall include a reasonable mileage allowance for vehicular
use, added labor costs, and, if applicable, any additional storage capacity
required by MUNICIPALITY as the result of a decrease in the number of waste
deliveries that can be made in a given day due to an increase in distance.
C. COMPANY may periodically suspend operations for maintenance and
repair purposes and shall use its best efforts to schedule such maintenance and
repairs at periods when delivery of a low quantity of Acceptable Waste is
anticipated and at periods of any energy purchaser's off-peak demand. COMPANY
shall use its best efforts to give thirty (30) day prior written notice to
MUNICIPALITY of a scheduled Suspension of Operations, indicating the expected
time, duration and nature of such Suspension of Operations.
ARTICLE XI. DAMAGE OR DESTRUCTION
If the Facility or any substantial portion thereof is so damaged or
destroyed by fire, the elements or other casualty that it is not feasible to
restore, repair or reconstruct the Facility, a Termination of Operations shall
be deemed to have occurred and this Agreement shall be automatically terminated
as of the date of such occurrence without any further liability on the part of
any party except for accrued and unpaid Tipping Fees including remaining
balances of Change-in-Law costs as set forth in Schedule C, payments to
reimburse COMPANY for expenses
-31-
32
incurred or paid by it to dispose of Unacceptable Waste and Performance Credit
amounts accrued or earned but unpaid.
ARTICLE XII. MUNICIPAL REVIEW COMMITTEE
A. In order to facilitate review of Facility operations and of the
performance and the interfacing of the numerous Charter Municipalities with
COMPANY and Bangor Hydro during the life of this Agreement, the Charter
Municipalities have formed the Municipal Review Committee to serve as
representative for the Charter Municipalities. The Municipal Review Committee
has established bylaws to govern its activities.
B. The functions of the Municipal Review Committee, in general,
shall encompass review of COMPANY's financial operating information and
monitoring of COMPANY expenses, Tipping Fee adjustments and of Change-in-Law
costs. COMPANY shall provide monthly and annually to the Municipal Review
Committee operation and performance reports of the Facility.
C. COMPANY will notify the Municipal Review Committee of any
material adverse change or potential change in the financial condition of
COMPANY which in its opinion could result in a cessation of operations. Any
notice of material adverse changes under this paragraph shall be signed by each
of COMPANY'S general partners and shall include, but not be limited to, the
following circumstances:
a. receipt by COMPANY from its lenders of a written notice that
an event of default has occurred and is continuing and that
such lenders intend to foreclose on the Facility or to take
possession thereof;
b. the occurrence of any material adverse change, claim or action
with respect to COMPANY which in its opinion would likely
result in the Facility no longer remaining in the business of
being a municipal solid waste disposal facility; or
c. a decision by COMPANY to cause the Facility no longer to
remain in the business of being a municipal solid waste
disposal facility.
-32-
33
COMPANY acknowledges its obligation of good faith in the giving of such notices
to the Municipal Review Committee.
The Municipal Review Committee will have up to ninety (90) days from
COMPANY's notice in which to evaluate the circumstances and to propose whatever
remedial action it deems necessary. COMPANY will have up to thirty (30) days
thereafter to provide a response to the Municipal Review Committee's proposal,
after which each party agrees to consider the proposals of the other in good
faith for a period of up to sixty (60) days before taking action(s). Upon
delivery of any such notice by COMPANY, the Municipal Review Committee may also
exercise the rights granted in Article XVI hereof.
D. In conjunction with the execution and delivery of this Agreement
and pursuant to a Warrant to Purchase Common Stock, dated as of ____________,
1998 (the "Warrant Agreement"), Bangor Hydro has issued to the Municipal Review
Committee on behalf of the Amending Charter Municipalities, including
MUNICIPALITY, in care and custody of Bangor Savings Bank or another institution
designated by the Municipal Review Committee, as custodian, warrants entitling
the holders to acquire one million shares of common stock of Bangor Hydro. The
warrants are exercisable as provided in the Warrant Agreement. The warrants will
be held in the custody of Bangor Savings Bank pursuant to a custodial agreement,
of even date herewith. MUNICIPALITY hereby irrevocably delegates, for the
current year and, to the extent permitted by law, for each future year during
the term of the Warrant Agreement, to the Municipal Review Committee, as its
agent, sole discretion to exercise or direct the sale of the warrants as further
provided in the MRC Administration Authorization and the custodial agreement
with Bangor Savings Bank. The Municipal Review Committee has agreed to advise
the Amending Charter Municipalities regarding the exercise of the warrants and
to distribute proceeds thereof to the Amending Charter Municipalities, based on
their respective ownership interests in the warrants. MUNICIPALITY acknowledges
and agrees that COMPANY has no responsibility or duty whatsoever to MUNICIPALITY
or the Municipal Review Committee in respect of the warrants or the exercise
thereof.
-33-
34
E. Under Article XIX hereof, Amending Charter Municipalities,
including MUNICIPALITY, are granted the option to participate in the purchase of
limited partnership interests in COMPANY and to designate all or a portion of
the Performance Credits to be used to pay the purchase price of such interests.
The Municipal Review Committee shall administer and advise the Amending Charter
Municipalities regarding the exercise of the option to participate therein and
whether to purchase such interests as provided in the MRC Administration
Authorization. If MUNICIPALITY exercises the option to participate as provided
in Article XIX and thus becomes an Equity Charter Municipality, MUNICIPALITY
hereby confirms its irrevocable authorization and direction to the Municipal
Review Committee, granted in the MRC Administration Authorization, this
Agreement and the other agreements contemplated by this Agreement, for the
current year and, to the extent permitted by law, for each future year during
the term of this Agreement, to receive the Performance Credits to be paid to
MUNICIPALITY under Article XVIII and apply them as provided in the MRC
Administration Authorization or in such other manner acceptable to MUNICIPALITY.
MUNICIPALITY acknowledges and agrees that COMPANY has no responsibility or duty
whatsoever to MUNICIPALITY to advise it as to the exercise of such option to
participate in the purchase of such limited partnership interests or in the
purchase thereof.
If MUNICIPALITY becomes an Equity Charter Municipality, MUNICIPALITY
hereby confirms its authorization and direction to the Municipal Review
Committee to administer and receive partnership distributions from COMPANY in
the name and on behalf of MUNICIPALITY, as further provided in the MRC
Administration Authorization to be executed by MUNICIPALITY and the Municipal
Review Committee as a condition to exercising the option to participate, as
provided in Article XIX, paragraph C.
ARTICLE XIII. DEFAULT; LIQUIDATED DAMAGES
A. Each of the following events shall constitute an "Event of
Default" hereunder:
-34-
35
1. A failure to pay when due and payable any amounts owed one
party to the other and the continuance of such failure for thirty (30) days
after receipt of written notice of nonpayment; or
2. Failure of either party to observe and perform any
covenant, condition or agreement on its part required to be observed or
performed by this Agreement for a continuous period of sixty (60) days after
receipt of written notice from the non-defaulting party, specifying such failure
and demanding such failure be corrected; provided, however, if the failure
stated in the notice cannot be corrected within such period, the non-defaulting
party will not unreasonably withhold its consent to an extension of such period
if corrective action is instituted within such period and diligently pursued
until the default is corrected.
B. Whenever any Event of Default shall have occurred and be
continuing, which Event of Default is substantial and concerns a material
provision of this Agreement, the non-defaulting party may terminate this
Agreement upon giving thirty (30) days' written notice to the defaulting party.
This provision, however, is subject to the condition that if, after sending a
notice of termination and prior to the date on which such termination otherwise
becomes effective, the defaulting party pays in full any amounts owing under
this Agreement or otherwise cures the Event of Default, the notice of
termination shall be canceled and the parties shall be restored to their prior
position under this Agreement, but no such cancellation shall affect any
subsequent default or impair or exhaust any rights or powers arising therefrom.
C. Whenever an Event of Default shall have occurred and be
continuing, the non-defaulting party may take whatever action may be necessary
or desirable to collect the payments and other amounts then due and thereafter
to become due as provided in this Agreement, and/or to enforce performance and
observance of any obligation, agreement or covenant under this Agreement.
D. [this provision to be adapted for each Charter Municipality based
on applicable provisions of its existing waste disposal agreement] If at any
time, a Termination of Operations occurs which is not caused by a termination
under Article VIII, Article XI or a Force
-35-
36
Majeure Event, COMPANY shall pay to MUNICIPALITY, as liquidated damages in lieu
of all other damages, including special, consequential, or indirect damages, two
hundred and fifty percent (250%) of (1) the total Tipping Fees paid to COMPANY
by the MUNICIPALITY for Acceptable Waste delivered to the Facility or to
alternate disposal facilities in accordance with this Agreement by it during the
twelve (12) months immediately preceding the date on which the Termination of
Operations occurred, or (2) if twelve (12) months have not elapsed from the
commencement of the delivery by MUNICIPALITY of Acceptable Waste to the date on
which the Termination of Operation occurs, the total Tipping Fees that would
have been paid by MUNICIPALITY to COMPANY had it delivered to the Facility an
amount of Acceptable Waste equal to its Guaranteed Annual Tonnage for such
Operating Year.
As provided in the Outstanding Agreement and other similar
agreements with the Charter Municipalities, there is a ceiling in the aggregate
for total liquidated damages that may be paid to the Charter Municipalities,
except as otherwise provided in the next succeeding paragraph. This ceiling is
$5 million, adjusted annually at January 1 (commencing with January 1, 1992) for
changes in the CPI-U as of the immediately preceding September 30 from that of
the September of the prior year. A Charter Municipalities' pro rata share of the
ceiling amount is the same ratio as the ratio of its Guaranteed Annual Tonnage
to the aggregate of the Guaranteed Annual Tonnage of all Charter Municipalities
delivering waste to the Facility as of the date Termination of Operations
occurs. This limitation on liability for monetary damages in the event of a
Termination of Operations shall be calculated for all Charter Municipalities and
the pro rata share of the ceiling amount allocable to those Charter
Municipalities not constituting Amending Charter Municipalities shall be applied
as a limitation on the amounts payable to such Charter Municipalities.
In consideration of the execution and delivery of this Agreement by
MUNICIPALITY and similar agreements by other Amending Charter Municipalities,
COMPANY hereby agrees that the ceiling amount described in the foregoing
paragraph and allocable to the
-36-
37
Amending Charter Municipalities shall not apply to the liquidated damages
payable to the Amending Charter Municipalities, including MUNICIPALITY.
It is acknowledged and agreed that the liability of Energy National,
Inc., a Utah corporation ("ENI"), as a general partner of COMPANY, for the
payment of liquidated damages by COMPANY under this paragraph D shall be limited
to $5 million, adjusted annually at January 1 (commencing with January 1, 1992)
for changes in the CPI-U as of the immediately preceding September 30 from that
of the September of the prior year. A Charter Municipalities' pro rata share of
the ceiling amount applicable to ENI is the same ratio as the ratio of its
Guaranteed Annual Tonnage to the aggregate of the Guaranteed Annual Tonnage of
all Charter Municipalities delivering waste to the Facility as of the date
Termination of Operations occurs.
E. If at any time prior to Termination of Operations, COMPANY fails
to accept and/or provide for the disposal of Acceptable Waste delivered to it by
MUNICIPALITY up to its Guaranteed Plant Capacity Share and such failure is not
caused by a Force Majeure Event, COMPANY shall pay to MUNICIPALITY all
reasonable costs incurred by MUNICIPALITY in disposing of such Acceptable Waste,
provided that nothing herein contained shall be construed to bar MUNICIPALITY
from obtaining specific performance of any obligation of COMPANY if such remedy
is otherwise available. COMPANY shall not be liable for its refusal or failure
to process any amounts annually in excess of MUNICIPALITY'S Guaranteed Plant
Capacity Share, if at the time such excess is proposed to be delivered to
COMPANY, COMPANY will not have the capacity to process such excess based upon
the amount of waste it is receiving from others; provided, however, that to the
extent the capacity is not available because of spot market tonnage being
brought in at a Tipping Fee higher than MUNICIPALITY's Tipping Fee, MUNICIPALITY
shall have the option of agreeing to pay such higher Tipping Fee for such excess
in which case COMPANY shall be obligated to accept such waste. COMPANY shall pay
such costs within forty-five (45) days of receipt of an itemized xxxx from
MUNICIPALITY.
-37-
38
F. In the event any agreement or covenant contained in this
Agreement should be breached by one party and thereafter waived by the other
party, such waiver shall be limited to the particular breach so waived and shall
not be deemed to waive any other breach hereunder.
ARTICLE XIV. CHANGE IN LAW
A. "Change in Law" includes the following: The promulgation,
adoption, enactment or change in any law, code, ordinance or regulation and/or
the rendering of any judgment, order, decree or other governmental action of any
Federal, State or local court, administrative agency, government office, body or
branch, occurring subsequent to January 1, 1991 affecting the operation or
maintenance of the Facility or the disposal of Residue, including by way of
example but not by way of limitation a refusal by such a governmental body to
grant, issue or renew any required permit or license or approval for the
operation of the Facility unless changes in the Facility are made or a
regulatory requirement imposed after January 1, 1991 by such a governmental body
implementing a previously enacted statute. Changes in Federal and State income
tax laws shall not be considered a Change in Law.
B. "Change in Law costs" means any increase in the cost of
financing, construction, modifying, operating or maintaining the Facility or the
Site, or the disposal of Residue, FEPR or By-Pass Waste related solely to a
Change in Law, which on a cumulative basis exceeds $100,000, provided that if
any such increase in cost results solely from a change in the design, fuel mix,
or operating criteria of the Facility which is not mandated by law and which is
initiated by the COMPANY subsequent to the execution of this Agreement, such
Change in Law cost shall be disregarded for purposes of this Article. See
Schedule C pertaining to Tipping Fee calculation as to how Change-in-Law costs
will be paid.
C. The following procedures shall govern this Article:
1. COMPANY shall notify the MUNICIPALITY and Municipal Review
Committee and the Municipal Review Committee shall notify the COMPANY in
writing, as soon as either party has knowledge of any administrative, court or
other governmental action
-38-
39
or the enactment of any law or regulation which could lead to a claim of an
occurrence of a Change in Law. COMPANY shall keep the Municipal Review Committee
informed of the progress of such actions.
2. Upon determining the impact of any Change in Law or
determining any Change-in-Law costs, COMPANY shall give the Municipal Review
Committee a detailed explanation thereof, including, appropriate designs or
plans for new construction or modifying items, bid cost and construction
schedule, and information regarding operations and maintenance costs. COMPANY
shall not expend any monies in response to a Change in Law until the Municipal
Review Committee has had forty-five (45) days to review such data, unless
COMPANY has been directed to or is required to take prior corrective action. The
Municipal Review Committee must authorize or disapprove expenditure of any
Change in Law costs proposed by COMPANY within forty-five (45) days of receipt
of the data, or propose an alternative reasonably satisfactory to COMPANY, or
said expenditure shall be conclusively deemed to be authorized by MUNICIPALITY.
During any Suspension of Operations because of any Change in Law pending review
by Municipal Review Committee under this paragraph, COMPANY shall be relieved of
any penalties and shall not be deemed to be in default.
E. Nothing in this Article shall relieve COMPANY from compliance
with any law or regulation or other lawful order.
ARTICLE XV. FORCE MAJEURE
A. Except as herein provided, if any party is rendered unable,
wholly or in part, by a Force Majeure Event to carry out its obligations other
than any payment obligation under the Agreement, that party shall give to the
other party prompt written notice of the Force Majeure Event with reasonably
full particulars concerning it. Thereupon the obligations of the Party giving
the notice, so far as they are affected by the Force Majeure Event, shall be
suspended during, but no longer than the continuance of the Force Majeure Event,
and for a reasonable time thereafter if required to remedy the physical damages
and/or place the Facility back in operation.
-39-
40
In the event that the Facility is subjected to a Force Majeure Event, COMPANY
shall not be obligated to accept Acceptable Waste or arrange for or pay for
disposal of By-Pass Waste.
B. The party whose performance is excused due to the occurrence of a
Force Majeure Event shall, during such period, keep the other party and the
Municipal Review Committee duly notified of all such actions required in order
for it to be able to commence or resume performance of its obligations under
this Agreement.
C. Financial inability of either party hereto or the technological
inability of the Facility to accomplish the purposes contemplated by this
Agreement shall not be deemed to be a Force Majeure Event.
ARTICLE XVI. ADDITIONAL REMEDIES UPON MATERIAL ADVERSE CHANGES
A. In the event that COMPANY is required to provide the Municipal
Review Committee with notice of a material adverse change as set forth in
Article XII, paragraph C, and such notice states as therein contemplated either
COMPANY's lenders intend to foreclose on the Facility, COMPANY'S opinion that
such change would likely result in the Facility no longer remaining in the
business of being a municipal solid waste disposal facility, or COMPANY's
decision to cause the Facility no longer to remain in the business of being a
municipal solid waste disposal facility, then the Municipal Review Committee may
take the following actions in addition to those described in said Article XII,
paragraph C:
So long as all the Charter Municipality agreements shall then
expressly provide for the same (i.e. expressly agree to the options herein
described), no later than 180 days from the date of such written notice, the
Charter Municipalities may irrevocably elect in writing addressed to COMPANY to
purchase the Facility, including any reserves of COMPANY not used to satisfy
obligations under or pursuant to any obligations of COMPANY to any provider of
credit enhancement or support for the bonds as set forth below (which purchase
shall be concluded no later than the end of such 180 day period) in accordance
with the provisions set forth in Schedule D to this Agreement, at a purchase
price equal to $1.00, and title to the Facility
-40-
41
and such reserves shall be conveyed as provided in Schedule D. Concurrently with
such purchase and as a condition precedent thereto, (i) the purchaser shall
assume all of COMPANY'S then existing obligations in respect to the
construction, ownership and operation of the Facility (other than those
obligations which are obligations that the partners, affiliates or associates of
COMPANY have undertaken in their individual capacities and not as partners or
affiliates of COMPANY), (ii) all parties to whom such partners, affiliates or
associates shall have undertaken any obligations with respect to the Facility in
their individual capacities and not as partners, including without limitation,
any obligations in connection with COMPANY'S power purchase and sale agreement
with Bangor Hydro and under or relating to capital contribution agreements of
the partners, but specifically excluding any obligations to or for the benefit
of Orrington Waste Ltd. Limited Partnership and any guaranties of such
obligations, shall have unconditionally released such partners, affiliates and
associates therefrom pursuant to instruments in form and substance reasonably
satisfactory to each of them; (iii) all of the obligations of COMPANY under and
pursuant to any agreement or instrument with any provider of credit enhancement
or support for the bonds shall have been indefeasibly satisfied in full in cash
by purchaser, and (iv) all parties whose consent is required to any such
purchase or assumption shall have unconditionally consented thereto in writing
pursuant to instruments in form and substance satisfactory to COMPANY. Nothing
in this Article XVI shall limit or otherwise restrict any right or remedy
provided to any provider of credit enhancement or support for the bonds or the
holders of the bonds, including, without limitation, the right to sell or
otherwise dispose of the Facility free and clear of any rights granted by this
Article XVI, upon any exercise of the rights or remedies provided therein or in
any way change or alter any of the obligations of COMPANY set forth in any
agreements relating to or securing the bonds or any agreement between COMPANY
and any provider of credit enhancement or support for the bonds.
MUNICIPALITY and the Municipal Review Committee acknowledge that
some circumstances which would give rise to a notice by COMPANY under Article
XII, paragraph C could make it difficult or beyond its reasonable control for
COMPANY to prevent
-41-
42
cessation of operations during the 180 day period contemplated by this Article
XVI without a cure of a default or other interim remedy until the Municipal
Review Committee has concluded its consideration of appropriate actions. Both
COMPANY, MUNICIPALITY and the Municipal Review Committee agree, however, that
there shall be no obligation of either party to provide an interim cure or
remedy, other than the obligation of the parties to diligently meet and consider
measures to enable the Municipal Review Committee to exercise its rights
hereunder.
B. Notwithstanding the rights set forth in paragraph A above,
COMPANY may at any time cure, remedy or cause the cessation of the default,
claim or adverse circumstance which gave rise to the notice and possible
cessation of operations or loss of possession; in which case COMPANY shall
provide the Municipal Review Committee notice that said default, claim or
adverse circumstance has in fact been remedied or cured, or has ceased whereupon
the Municipal Review Committee's rights under paragraph A above shall terminate
nunc pro tunc; provided, however, that in the event of such cure, if COMPANY
fails to provide the Municipal Review Committee with notice of COMPANY'S
intention to cure, remedy or cause the cessation of the default, claim or
adverse circumstance within 90 days of COMPANY having provided notice under
Article XII, paragraph C, COMPANY shall reimburse the Municipal Review Committee
for justifiable and reasonable costs and expenses the Municipal Review Committee
incurs with respect to the intended purchase of Facility pursuant to paragraph A
so long as COMPANY'S need to cure or remedy the default (of which it gives
notice of its intention) is not caused by the Charter Municipalities' inability
to purchase the Facility.
C. The provisions set forth in this Article XVI shall not restrict
the rights of COMPANY to secure additional or alternative financing for the
Facility prior to providing notice under Article XII, paragraph C. However,
COMPANY acknowledges its obligation under the Charter Municipality agreements to
fully inform the Municipal Review Committee of COMPANY'S financial
circumstances. COMPANY agrees to provide upon request by the Municipal Review
Committee copies of its credit agreements and other financing agreements to
which it is a party. COMPANY also acknowledges that since changes in the debt
obligations of
-42-
43
COMPANY with respect to the Facility are of interest to the Municipal Review
Committee as a potential purchaser of the Facility, COMPANY will advise the
Municipal Review Committee of any new financing activities. In turn, the
Municipal Review Committee acknowledges that any active pursuit of alternative
financing by the Municipal Review Committee without COMPANY'S knowledge could
have an adverse impact on COMPANY'S operating ability and agrees to advise
COMPANY first of any desire to refinance the Facility and to utilize the
consultation provisions of the Charter Municipality agreements to consider
mutually with COMPANY any such proposals.
D. After the Municipal Review Committee undertakes remedial
measures, if the Facility continues to be available to Charter Municipalities
for processing their waste, notwithstanding a decision by some or all Charter
Municipalities to terminate their delivery of waste to the Facility, it is
intended by this Article XVI that an Event of Default and Termination of
Operations shall not be deemed to have occurred and COMPANY'S obligations under
Article XIII, if any, relating to the payment of liquidated damages to Charter
Municipalities in the event of a Termination of Operations shall not apply.
E. The provisions set forth in paragraph A granting the Charter
Municipalities the right to acquire COMPANY'S right, title and interest in the
Facility and all of COMPANY'S obligations are conditioned upon receipt of a duly
authorized waiver, from all of the Charter Municipalities, of damages and
acknowledgment of the absence of an Event of Default under Article XIII,
paragraph D of the Charter Municipality agreements. Such waiver of damages by
the Charter Municipalities shall not apply to any subsequent Termination of
Operations if the Municipal Review Committee's remedial efforts result in
continued availability of Facility under COMPANY'S ownership or possession and
there is a subsequent cessation of operations in a separate occurrence that is
not remedied.
F. The waivers and obligations of COMPANY set forth in this Article
XVI shall remain effective only so long as no Charter Municipality has filed a
civil action or initiated an arbitration proceeding against COMPANY alleging or
based upon an infirmity in the
-43-
44
Municipal Review Committee's consent or a violation or breach of Article XXXIII
of the Charter Municipality agreements; provided that COMPANY may waive this
limitation on the effectiveness of its waivers and obligations created by this
Article XVI.
ARTICLE XVII. ASSIGNMENT
A. Except as provided in paragraph D below, this Agreement shall not
be assigned by COMPANY to any third party without Municipal Review Committee
approval, which shall not be unreasonably withheld.
B. This Agreement shall not be assigned by MUNICIPALITY to any third
party without COMPANY approval, which shall not be unreasonably withheld.
C. Notwithstanding paragraphs A and B of this Article, MUNICIPALITY
may assign its interest in this Agreement to the District, provided such
District includes the MUNICIPALITY.
D. MUNICIPALITY acknowledges that this Agreement has been assigned
as security to the banks which provided financing for the Facility and the
assignment remains effective in all respects with respect to this Agreement.
MUNICIPALITY further acknowledges that this Agreement has been or will be
assigned as security to the Finance Authority of Maine, as the issuer of bonds
to provide refinancing for the Facility, to the trustee for holders of such
bonds and to any other entity or entities which provide credit support for such
bonds, and the assignment remains effective in all respects with respect to this
Agreement. MUNICIPALITY agrees to provide, upon written request of COMPANY, to
COMPANY or any party described in the previous sentence in writing a
confirmation of its acknowledgment of and consent to any such assignment and as
to the effectiveness of this Agreement.
ARTICLE XVIII. PERFORMANCE CREDITS
A. Under Article XVIII of the Outstanding Agreement, MUNICIPALITY is
entitled to certain Performance Credits on the terms and conditions therein
specified. Since this Agreement amends the manner of calculation of Performance
Credits, MUNICIPALITY and COMPANY hereby agree that for purposes of the
calculation of Performance Credits and Net
-44-
45
Compensation under the Outstanding Agreement, the close of business of the day
before the Closing Date shall be treated as the end of a calendar year and any
Performance Credits and Net Compensation earned under the Outstanding Agreement
shall be calculated and determined as of such date, giving effect to the
release, if any, of funds from reserve accounts effected on the Closing Date
which are to be taken into account as Distributable Cash (as defined in and in
accordance with the Outstanding Agreement). It is acknowledged and agreed that
the Finance Authority of Maine has indicated that it will require the funding of
certain reserve funds or accounts on the Closing Date: $6,000,000 in a debt
service reserve account, such deposit to be made by funds advanced by Bangor
Hydro under the amended Power Purchase Agreement; $3,000,000 in an operating
reserve fund, such deposit to be made by funds provided by COMPANY from existing
reserves released as a result of the refinancing; and $1,000,000 in a capital
improvement fund, such deposit to be made by funds provided by COMPANY from
existing reserves released as a result of the refinancing. MUNICIPALITY
acknowledges and agrees that such closing requirements are preliminary and
consents to additional deposits in these or other reserve accounts as may be
required of COMPANY or Bangor Hydro by the Finance Authority of Maine, the
trustee for the bonds or any provider of credit enhancement or support for such
bonds, as approved by the Municipal Review Committee. It is acknowledged and
agreed that to the extent that any cash reserves of COMPANY existing prior to
the Closing Date are used to fund operating or debt service reserves or other
financial requirements in respect of, or are required in connection with, the
bonds to be issued on the Closing Date to refinance the Facility, such
pre-existing cash reserves shall not be treated as Distributable Cash under the
Outstanding Agreement. It is further acknowledged and agreed that COMPANY on the
Closing Date, after providing for payment or reserves for payment of
Distributable Cash (as defined in the Outstanding Agreement) to the Charter
Municipalities and COMPANY (including Net Compensation (as defined in the
Outstanding Agreement)), funding reserves and capital improvement funds as
contemplated above and retaining sufficient operating funds, consistent with
prior practices and prudent financial management, to permit operations of the
Facility, shall
-45-
46
distribute the remainder of its then existing cash balances one-half (50%) to
the Charter Municipalities and one-half (50%) to partners in COMPANY.
The Performance Credits earned under the Outstanding Agreement shall
be calculated as of the Closing Date and a preliminary payment thereof made by
COMPANY as soon as reasonably practicable thereafter, initially calculated on
the assumption that all Charter Municipalities will become Amending Charter
Municipalities, subject to a final payment and adjustment to reflect the actual
Amending Charter Municipalities to be made on or before September 1, 1998.
B. Performance Credits under this Agreement shall be determined and
paid in accordance with this paragraph B. The Amending Charter Municipalities
shall have the right to receive, in cash, one-third (33-1/3%) of the cumulative,
Distributable Cash, as defined in Schedule E annexed hereto, from and after the
Closing Date (the "Performance Credits"), which shall be payable to Bangor
Savings Bank or other institution designated by the Municipal Review Committee;
provided, however, that the rights of the Amending Charter Municipalities to
receive Performance Credits shall be subject to and limited by the prior right
of the Municipal Review Committee to allocate and apply Performance Credits to
the purchase of limited partnership interests in COMPANY pursuant to Paragraph
(C)(3)(III) of Article XIX of this Agreement. Notwithstanding the foregoing
provisions of this Article XVIII, (i) any cash deposited in the "Principal
Reserve and Redemption Account" (or similar account) or in the "Bangor Hydro
Reserve Account" (or similar account) required by the Finance Authority of Maine
into which Bangor Hydro's installment payments under the amended Power Purchase
Agreement are payable, and (ii) any payments made to reserve accounts required
by the Finance Authority of Maine, the trustee for the bonds or any provider of
credit enhancement or support for such bonds by COMPANY or MUNICIPALITY from
installment payments made by Bangor Hydro under the amended Power Purchase
Agreement or from amounts that would otherwise constitute distributions to
COMPANY or MUNICIPALITY under the Trust Agreement, to the extent not otherwise
applied in accordance with the Trust Agreement or other document governing such
-46-
47
reserve account (collectively, the "Equity Reserves"), shall not constitute
Distributable Cash under this Agreement, and the Amending Charter Municipalities
and the partners in COMPANY as of the Closing Date shall each have the right to
receive one-half (50%) of the Equity Reserves and any investment income
therefrom, from and after the Closing Date, but only if and to the extent and at
the time that such Equity Reserves and investment income (or funds held in other
accounts in lieu thereof) are released to COMPANY, as further provided in the
Trust Agreement; provided, however, that the rights of the Amending Charter
Municipalities to receive Equity Reserves and investment income thereon shall be
subject to and limited by the prior right of the Municipal Review Committee to
allocate and apply such Equity Reserves and investment income to the purchase of
limited partnership interests in COMPANY pursuant to Paragraph (C)(3)(III) of
Article XIX of this Agreement. The amount of Equity Reserves to be distributed
to the Amending Charter Municipalities shall be allocated to MUNICIPALITY in the
same proportion that Performance Credits are then allocated to MUNICIPALITY
under the next succeeding paragraph. The portion of the Equity Reserves and
investment income to be paid to MUNICIPALITY shall be paid to Bangor Savings
Bank or other institution designated by the Municipal Review Committee. From the
Performance Credits payable to the Amending Charter Municipalities there shall
be deducted "Performance Credits" (as defined therein) payable to Charter
Municipalities that are not Amending Charter Municipalities under waste disposal
agreements with COMPANY.
The amount of Performance Credits to be distributed to the Amending
Charter Municipalities shall be allocated to MUNICIPALITY in proportion to the
average of (a) the proportion of Acceptable Waste credited to MUNICIPALITY under
this Agreement to the aggregate amount of Acceptable Waste credited to all of
the Amending Charter Municipalities under this Agreement and similar waste
disposal agreements in the calendar quarter for which the Performance Credits
are being calculated; and (b) the proportion of the Guaranteed Annual Tonnage of
MUNICIPALITY to the Guaranteed Annual Tonnage for all Amending Charter
Municipalities, as of the last day of the calendar quarter for which the
Performance Credits are
-47-
48
being calculated. Notwithstanding the immediately preceding sentence, the
Municipal Review Committee, upon a vote of its Board, following an opportunity
to be heard by any affected Amending Charter Municipality, and upon written
notice to COMPANY and MUNICIPALITY given not less than 45 days before the
effective date of such change, may change the allocation of Performance Credits
among the Amending Charter Municipalities, including MUNICIPALITY. The
Performance Credits shall be calculated quarterly based upon the operations of
the Facility during the preceding quarter. The Performance Credits shall be
recognized upon determination, but MUNICIPALITY shall not be entitled to any
credit or payment of Performance Credits until the end of the following quarter
or as soon thereafter as funds are released therefor under the Trust Agreement,
but only to the extent that funds are released under the Trust Agreement and are
available therefor. Upon delivery of the annual audit of COMPANY, the
Performance Credits for the year covered by the audit shall be adjusted to
accord with the audit, and any credits or debits thereto shall be applied to the
next distribution of Performance Credits hereunder.
ARTICLE XIX. EXERCISE OF OPTION TO EXTEND TERM; OPTION TO PURCHASE
PARTNERSHIP INTERESTS; OPTION TO PURCHASE LIMITED PARTNERSHIP INTERESTS
A. By the execution and delivery of this Agreement, MUNICIPALITY has
irrevocably elected to exercise the option under Article XIX of the Outstanding
Agreement, alternative (D)(3), to extend the term of the Outstanding Agreement
for 15 years. MUNICIPALITY acknowledges and consents to the reduction in the
extension of the term of the Outstanding Agreement from 15 years to 14 years, as
evidenced by this Agreement, in order to coincide with the stated expiration
date of the original and amended Power Purchase Agreement between Bangor Hydro
and COMPANY, and MUNICIPALITY acknowledges and agrees that such reduction in
term is in the best interests of MUNICIPALITY and its residents. MUNICIPALITY
further acknowledges and agrees that such exercise is effective notwithstanding
any variation of terms of this Agreement from the Outstanding Agreement.
-48-
49
By the execution and delivery of this Agreement and of similar waste
disposal agreements by other Amending Charter Municipalities and the acceptance
hereof and thereof by COMPANY, it is acknowledged and agreed that MUNICIPALITY,
with such other Amending Charter Municipalities, have effectively exercised the
option granted to the Charter Municipalities under Article XIX of the
Outstanding Agreement and other similar agreements (alternative (D)(3)) to
extend the term of the Outstanding Agreement and the outstanding Charter
Municipality agreements between COMPANY and the other Amending Charter
Municipalities, notwithstanding that the extension is in substance for 14 years
instead of 15 years (since that date coincides with the stated expiration date
of the original and amended Power Purchase Agreement between Bangor Hydro and
COMPANY), notwithstanding any variation of terms of this Agreement from the
Outstanding Agreement, and notwithstanding that the effectiveness of such
exercise is to be based on the selection of an alternative by the Charter
Municipalities with a majority of Guaranteed Annual Tonnage as of January 1,
2003 (since the Amending Charter Municipalities will constitute at the Closing
Date a majority of Guaranteed Annual Tonnage and no pooling of Guaranteed Annual
Tonnage on or before January 1, 2003, may cause the Guaranteed Annual Tonnage of
the Amending Charter Municipalities to be less than 51% of the Guaranteed Annual
Tonnage of all Charter Municipalities, as provided in Article V of this
Agreement and the other Charter Municipality agreements with the Amending
Charter Municipalities). Consequently, no other option remains to be exercised
by MUNICIPALITY under Article XIX of the Outstanding Agreement (including,
without limitation, the option to purchase the Facility on March 31, 2004).
B. The Amending Charter Municipalities, including MUNICIPALITY, if
they remain parties to Charter Municipality agreements with COMPANY through
March 31, 2018, have the right to purchase as of March 31, 2018 all partnership
interests in COMPANY not owned by Equity Charter Municipalities, in whole but
not in part, at their then fair market value, as further provided in the
partnership agreement of COMPANY as in effect on the Closing Date,
-49-
50
whether or not such Amending Charter Municipalities are Equity Charter
Municipalities, and which option may be exercised by one, more or all of such
Amending Charter Municipalities.
C. MUNICIPALITY shall have the right, in conjunction with the other
Amending Charter Municipalities (except those municipalities that become
Amending Charter Municipalities after September 30, 1998), to exercise an
irrevocable option to participate in the purchase of limited partnership
interests in COMPANY (the "Equity Participation Option") up to 50% of the total
interest in capital and profits of COMPANY, which is hereby granted to all such
Amending Charter Municipalities and described below, subject to the following
terms and conditions:
1. Term of Equity Participation Option. Notice of exercise of the
Equity Participation Option must be given by 5:00 o'clock p.m. on September 30,
1998. If notice of the exercise of the Equity Participation Option is not
received by COMPANY as provided in subparagraph (2) hereof, the Equity
Participation Option in favor of MUNICIPALITY shall expire. The exercise of the
Equity Participation Option is irrevocable by MUNICIPALITY.
2. Means of Exercise. The Equity Participation Option shall be
exercised by written notice delivered to COMPANY at its offices at the Facility
in Orrington, Maine, either by personal delivery to the Facility on-site plant
Manager, or by certified mail, received prior to the expiration of the term of
the Equity Participation Option.
3. Participation by MUNICIPALITY. To be an effective exercise of the
Equity Participation Option, the notice of exercise of the Equity Participation
Option shall contain a certification by MUNICIPALITY and an acknowledgment by
the Municipal Review Committee that MUNICIPALITY and the Municipal Review
Committee have entered into the MRC Administration Authorization pursuant to
which MUNICIPALITY has irrevocably appointed the Municipal Review Committee to
act as its agent in the administration of the purchase of limited partnership
interests in COMPANY pursuant to the Equity Participation Option and the
application of partnership distributions, including authorization for the
Municipal Review Committee to designate in the name and on behalf of
MUNICIPALITY the amount of
-50-
51
Performance Credits to be applied on the account of MUNICIPALITY to purchase
limited partnership interests in COMPANY, as contemplated by paragraph III
below.
If an Amending Charter Municipality, including MUNICIPALITY,
effectively exercises its Equity Purchase Option, it then shall have the right
to purchase limited partnership interests in COMPANY on the following terms and
conditions, as further provided in the partnership agreement of COMPANY, as in
effect on the Closing Date:
I. Additional Partnership Interests. Such limited partnership
interests shall be additional limited partnership interests authorized by the
partnership agreement of COMPANY, and shall not constitute a sale or assignment
by any current partner in COMPANY of its partnership interest as in effect
before the Closing Date.
II. Purchase Price. The purchase price of five-ninths (5/9ths) of
the total limited partnership interests in COMPANY (which equals 50% of the
total interest in capital and profits of COMPANY) shall be equal to
$31,000,000.00 (the "Purchase Price"); provided, however, that if less than a
five-ninths (5/9ths) limited partnership interest is purchased, the purchase
price shall be equal to a proportionate share of the Purchase Price based on the
limited partnership interests acquired.
The total limited partnership interests for all Equity Charter
Municipalities acquired at any one time, as provided in paragraph III below,
shall be equal to the product of: (i) five-ninths (5/9ths) of the total limited
partnership interests in COMPANY, times (ii) the aggregate amount then paid by
the Equity Charter Municipalities pursuant to paragraph III, divided by (iii)
the Purchase Price; provided, however, that at no time through the exercise of
the Equity Participation Option may the Equity Charter Municipalities acquire in
the aggregate more than 50% of the total interest in capital and profits of
COMPANY.
III. Payment of Purchase Price. If MUNICIPALITY has effectively
exercised the Equity Purchase Option, the Municipal Review Committee, on behalf
of MUNICIPALITY, may, at any time and from time to time (but not more frequently
than once each calendar quarter) after the later of: (i) September 30, 1998, or
(ii) the date six months after
-51-
52
the Closing Date, purchase limited partnership interests in COMPANY by the
designation of all or a portion of the Performance Credits payable to
MUNICIPALITY or previously paid to MUNICIPALITY under Article XVIII or Equity
Reserves payable or previously paid to MUNICIPALITY under Article XVIII for use
by COMPANY in the prepayment and redemption of bonds or other borrowing that has
refinanced the Facility and COMPANY hereby agrees to apply such amounts to such
purpose as soon as is reasonably practicable under the documents evidencing or
securing such bonds or other borrowing. The effective date of the purchase of
the limited partnership interests shall be the date on which COMPANY's
obligations in respect of the bonds or such other borrowing is prepaid. The
amount of Performance Credits or Equity Reserves to be applied by the Municipal
Review Committee on behalf of MUNICIPALITY and all other Equity Charter
Municipalities at any single time to purchase limited partnership interests
shall be equal in principal amount to an authorized principal amount of bonds or
such other borrowing that may then be prepaid in accordance with their terms.
Pursuant to the MRC Administration Authorization, the Municipal
Review Committee on behalf of MUNICIPALITY shall designate quarterly the amount,
if any, of the Performance Credits and Equity Reserves allocated to MUNICIPALITY
to be applied to such purchase. To the extent that such Performance Credits and
Equity Reserves are so applied, MUNICIPALITY shall have acquired limited
partnership interests in COMPANY to the extent of the purchase price thereof, as
further provided in the partnership agreement of COMPANY. COMPANY agrees to
evidence such partnership interests in its books and records and to provide such
further documentation thereof as MUNICIPALITY or the Municipal Review Committee
shall reasonably request.
MUNICIPALITY acknowledges that its ownership share of limited
partnership interests in COMPANY will be based on its respective share of
cumulative prior contributions of Performance Credits and Equity Reserves toward
the purchase of such limited partnership interests. MUNICIPALITY hereby ratifies
and confirms its delegation to the Municipal Review Committee pursuant to the
MRC Administration Authorization, to the extent
-52-
53
permitted by law, of authority to vote and otherwise act in its name and on its
behalf as to its limited partnership interests in COMPANY. Partnership
distributions to be made to MUNICIPALITY as a result of its limited partnership
interest in COMPANY shall be made to Bangor Savings Bank, as custodian, to be
administered by the Municipal Review Committee on behalf of MUNICIPALITY.
MUNICIPALITY acknowledges and agrees that COMPANY has no
responsibility or duty whatsoever to MUNICIPALITY or the Municipal Review
Committee to advise either of them as to the use and application of Performance
Credits or Equity Reserves, exercise of the Option or the use and application of
partnership distributions, if any.
ARTICLE XX. NOTICES
All notices herein required or permitted to be given or furnished
under this Agreement by either party to the other shall be in writing, and shall
be deemed sufficiently given and served upon the other party if sent by
certified or registered mail, return receipt requested, postage prepaid,
addressed as follows:
If to COMPANY: Penobscot Energy Recovery Company,
Limited Partnership
X.X. Xxx 000
Xxxxx 00
Xxxxx Xxxx
Xxxxxxxxx, Xxxxx 00000
Attention: Plant Manager
With copies to: Xxxxxxx X. Xxxxxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxxxx
Broder & Micoleau
One Canal Plaza
P.O. Box 7320 DTS
Xxxxxxxx, Xxxxx 00000
and
Municipal Review Committee, Inc.
Eastern Maine Development Corporation
Xxx Xxxxxxxxxx Xxxxx
Xxxxxx, Xxxxx 00000
-53-
54
If to MUNICIPALITY: See Schedule A
With a copy to: Municipal Review Committee, Inc.
Eastern Maine Development Corporation
Xxx Xxxxxxxxxx Xxxxx
Xxxxxx, Xxxxx 00000
Each party shall have the right, from time to time to designate a different
person and/or address by notice given in conformity with this section.
ARTICLE XXI. BINDING EFFECT
The Agreement shall bind upon and inure to the benefit of the
parties hereto and their respective successors or assignees.
ARTICLE XXII. OTHER DOCUMENTS
Each party promises and agrees to execute and deliver any
instruments and to perform any acts which may be necessary or reasonably
required in order to give full effect hereto.
ARTICLE XXIII. HEADINGS
Captions and headings herein are for ease of reference and do not
constitute a part of this Agreement.
ARTICLE XXIV. COUNTERPARTS
This Agreement may be executed in more than one counterpart, each of
which shall be deemed an original and all of which together shall constitute the
same agreement.
ARTICLE XXV. APPLICABLE LAW
The law of the State of Maine shall govern the validity,
interpretation, construction and performance hereof.
ARTICLE XXVI. AMENDMENT OF AGREEMENT
No amendments to this Agreement may be made except in writing signed
by both parties. This Agreement has been or will be assigned to a trustee under
bond financing
-54-
55
arrangements or to the issuer or the providers of credit enhancement for such
bonds and the written consent of all such assignees shall also be required
before any amendment becomes effective.
ARTICLE XXVII. SEVERABILITY
In the event any covenant, condition or provision of this Agreement
is held to be invalid or unenforceable by a final judgment of a court of
competent jurisdiction, the invalidity or unenforceability thereof shall in no
way affect any of the other covenants, conditions or provisions hereof, provided
that such remaining covenants, conditions or provisions can thereafter be
applicable and effective without materially changing the obligations of either
party.
ARTICLE XXVIII. RELATIONSHIP OF THE PARTIES
Nothing herein shall be deemed to constitute either party a partner,
agent or local representative of the other party or to create any fiduciary
relationship between the parties. MUNICIPALITY may, however, acquire an interest
in COMPANY as provided in Article XIX hereof.
ARTICLE XXIX. REPRESENTATIVES
The authorized representative of each of the parties for the
purposes hereof shall be such persons as the parties may from time to time
designate in writing.
ARTICLE XXX. INTEGRATION; CONFLICTS
This instrument (including all Schedules attached hereto, which are
hereby incorporated herein and made a part hereof) embodies the whole of this
Agreement. There are no promises, terms, conditions, or obligations between the
parties other than those contained herein or in the written agreements
specifically referenced herein (such as the Trust Agreement, the amended Power
Purchase Agreement between Bangor Hydro and COMPANY and the Warrant Agreement).
This Agreement amends, supplements, restates, extends and supersedes the
Outstanding Agreement and all supplements thereto and all other previous
communications, representations, or agreements, either oral or written, between
the parties hereto in respect of the subject matters covered hereby.
-55-
56
In the event that the requirements of any Article of this Agreement
shall be found to be inconsistent with those of any Schedule, the Article shall
control.
ARTICLE XXXI. CONSENTS
To the extent that the consent of either party to this Agreement is
required to any action of the other party pursuant to any provision of this
Agreement, such consent will not be unreasonably withheld.
ARTICLE XXXII. ARBITRATION
A. MUNICIPALITY and COMPANY shall confer from time to time to review
Facility operations and the relationship in general.
B. MUNICIPALITY and COMPANY agree that, if any dispute arises under
Articles V(D), (E) and (I), VI, VII, X, XII, XIII, XIV, XVI, XVII, XVIII, and
XIX(F), resolution of that dispute shall be conducted by COMPANY and the
Municipal Review Committee pursuant to this Article XXXII and the results
thereof shall be binding on MUNICIPALITY, COMPANY and the Municipal Review
Committee.
C. The parties shall submit such dispute to an arbitrator to obtain
a binding resolution thereof. The dispute shall be submitted to the arbitrator
as soon as the dispute arises. The arbitrator shall be a person mutually agreed
upon by the parties or, if the parties are unable to reach such agreement, there
shall be three (3) arbitrators, one selected by each of the parties within five
(5) days after the dispute arises and a third chosen by the two appointed within
five (5) days after their selection. The parties then shall provide whatever
information and material the arbitrators deem necessary to resolve the dispute.
The arbitrators shall decide the dispute within twenty (20) days after the
arbitrators have been selected. If there is only one arbitrator, his decision
shall be binding on COMPANY, MUNICIPALITY and the Municipal Review Committee,
and if there are three, the decision of any two shall be binding. The parties
intend that this arbitration process will expeditiously resolve disputes
relative to financial or
-56-
57
technical matters relating to the Facility. The costs of such arbitration shall
be shared equally by the parties.
ARTICLE XXXIII. MISCELLANEOUS
To the extent permitted by law, no municipality, Charter
Municipality, or commercial entity will be offered a long term,
non-interruptible waste disposal agreement by COMPANY on any terms more
favorable than described herein unless either the Municipal Review Committee
consents or all more favorable terms, including tipping fee, are made available
to MUNICIPALITY. No municipality will be offered any Spot Market Contract
without Municipal Review Committee consent.
COMPANY agrees that the tipping fee rate under any future waste
disposal contracts with the City of Xxxxxxxxx and the Towns of Newport,
Pittsfield, Detroit, Monroe, Prospect, Winterport and Frankfort, Maine, will
equal at least the greater of (i) the market rate in effect at the time for
waste disposal agreements with substantially similar terms, or (ii) the then
current Charter Municipality rate (the average of the Tipping Fee under this
Agreement and, if there are Charter Municipalities that are not Amending Charter
Municipalities, the Tipping Fee in effect under the waste disposal agreements of
such Charter Municipalities with COMPANY), plus the "Equivalent Escalating
Spread," as reasonably determined by the Municipal Review Committee in
consultation with COMPANY.
COMPANY may engage in refinancing of indebtedness or other
borrowings at any time without the consent of the Municipal Review Committee
only if such refinancings or other borrowing do not materially adversely affect
Distributable Cash or the Performance Credits; provided, however, that COMPANY
may incur indebtedness, without the consent of the Municipal Review Committee,
to the extent COMPANY reasonably deems necessary to provide for maintenance and
repair of the Facility or to enable the Facility or its operation to comply with
applicable law or permit requirements.
-57-
58
This Agreement shall not take effect unless and until the Closing
Date occurs. If the Closing Date does not occur on or before December 31, 1998,
this Agreement shall be without force and effect, and the Outstanding Agreement,
as such as been heretofore otherwise amended or supplemented, shall continue to
govern.
IN WITNESS WHEREOF, the parties hereto have executed this amended,
supplemented, restated and extended agreement on this ____ day of _______, 199_.
WITNESS: [MUNICIPALITY]
____________________________ By:_______________________________________
Its
PENOBSCOT ENERGY RECOVERY COMPANY,
LIMITED PARTNERSHIP
By: PERC Management Company,
Its General Partner
By: PERC, Inc.
Its General Partner
By:
Its President
-58-
59
By: Energy National, Inc.,
Its General Partner
By:
Title:
-59-
60
SCHEDULE A
Name and address of MUNICIPALITY:
Send copy of notices to MUNICIPALITY to:
1. Guaranteed Annual Tonnage per Operating Year to be delivered by MUNICIPALITY
pursuant to Article V
2. Monthly Estimate (non-binding) of tons of Acceptable Waste
Jan. ______ July ______
Feb. ______ Aug. ______
March ______ Sept. ______
April ______ Oct. ______
May ______ Nov. ______
June ______ Dec. ______
-60-
61
SCHEDULE B
Charter Municipalities and Reference GATs
Charter Municipality Reference GAT
-------------------- -------------
Albion 600
Xxxxx 260
Xxxxxxxx 144
Baileyville 1,200
Bangor 27,000
Bar Harbor 4,600
Blue Hill 2,000
Boothbay Reg. 4,500
Xxxxxxx 425
Xxxxxx 9,000
Xxxxxx 258
Brownville 640
Bucksport 2,750
Xxxxxxx 500
Camden, Rockport, Lincolnville, Hope 5,400
Xxxxxx 000
Xxxxxxx Xxxxxxxxx 1,100
China 1,000
Xxxxxxx 300
Clinton 2,000
Corinna 1,729
Xxxxxxx 444
Dedham 400
Dexter 3,600
Dover-Foxcroft 1,700
Eddington 000
Xxxxxxx 000
Xxxxxx 250
Fairfield 3,000
Friendship 492
Glenburn 1,300
Gouldsboro 000
Xxxxxxxxx 000
Xxxxxxxx 1,400
Hampden 3,200
Xxxxxxx 1,014
Hermon 1,965
Holden 1,050
Xxxxxxx 130
Charter Municipality Reference GAT
-------------------- -------------
-61-
62
Lamoine 350
Xxx 352
Levant 679
Lincoln 3,000
Lucerne 175
Mariaville 106
Xxxxxx 5,400
Mars Hill 500
Mattawamkeag 400
Milford 1,100
Millinocket 3,000
Milo 1,320
Xxxxxx 000
Xx. Xxxxxx 1,800
Newburgh 000
Xxx Xxxx 0,000
Xxxxxx 000
Xxxxx 5,100
Xxxx 210
Owls Head 780
Palmyra 000
Xxxxxxx 000
Xxxxxxxxx Xxxxxx 000
Xxxxxxxx Xxxxx SWD 1,400
Plymouth 360
Xxxx Plantation 100
Rockland 5,100
St. Albans 474
Sangerville 400
Searsport 1,500
South Thomaston 000
Xxxxxxxxx Harbor 2,000
Xxxxxxx 000
Xxxxxxx 000
Xxxxxxxxxx 000
Surry 1,000
Thomaston 1,560
Thorndike 200
Tremont 1,000
Trenton 600
Xxxx 250
Union 300
Unity 702
Charter Municipality Reference GAT
-------------------- -------------
Vassalboro 1,250
Veazie 800
-62-
63
Verona 275
Waldoboro 2,100
Waterville 21,000
West Xxxxxxx 1,005
Xxxxxxx 3,850
Winthrop 3,200
-63-
64
MUNICIPALITIES WITH LONG-TERM WASTE DISPOSAL CONTRACTS WITH COMPANY
BUT WHICH ARE NOT CHARTER MUNICIPALITIES AS OF THE CLOSING DATE
Municipality Guaranteed Annual Tonnage
------------ -------------------------
Xxxxxx 000
Xxxxxxxxx Xxxxxx 000
Xxxxxxxxx 00
Xxxxxxxxxxx 00
Xxxxxxxxxx/Xxxxxx 200
Castine 260
Cherryfield 300
Xxxxxxx 220
Xxxxxxx 000
Xxxxxxxx 00
Xxxx 000
Freedom 000
Xxxxxxxxxx 000
Xxxxxxx 425
Xxxxxx 150
Kenduskeag 170
Xxxx 150
LaGrange 180
Xxxxxxxx 24
Xxxxxxx 00
Xxxxxxxxx 000
Monticello 240
Montville 260
NARIF 8,000
Northern Katahdin 1,500
Oakfield 260
Passadumkeag 160
Piscataquis 200
Xxxx Plantation Group 000
Xx. Xxxxxxx, Xx. Xxxx Plantation 275
Searmont 270
Sebec 180
Xxxxxxx 480
Springfield 160
Swans Island 200
TriCounty 1,180
Wiscasset 3,400
-64-
65
SCHEDULE C
Tipping Fee Calculation
A. The two components of the total Tipping Fee to be paid are the
Base Rate and the Variable Rate. The Base Rate, for the period from April 1,
1991 through and including December 31, 1991, is $35.16 per ton which Base Rate
shall be available to only Charter Municipalities. The Base Rate will be
adjusted in subsequent Operating Years as provided for in Article VI, Paragraph
C of the Agreement.
The Variable Rate shall be added to the Base Rate and paid by
Municipality in accordance with the terms of the Agreement. For the period from
April 1, 1991 through June 30, 1991, the Variable Rate shall be $7.45 per ton.
The Variable Rate in respect of any calendar quarter commencing on or after July
1, 1991 shall be an amount per ton of Acceptable Waste equal to:
1. the initial Variable Rate of $7.45 per ton; plus
2. the Pass-through Costs as estimated by COMPANY for such
quarter, divided by the total tons of Acceptable Waste that
COMPANY estimates will be delivered in such quarter (except in
calculating the Change-in-Law costs and Change in Rate of
Interest Cost, the denominator shall not include tonnage under
Spot Market Contracts originating from outside the State of
Maine); plus
3. a reconciliation calculated as the difference between (i) the
amount in dollars corresponding to the Variable Rate component
of the total Tipping Fee that COMPANY was entitled to receive
from the Charter Municipalities in the previous quarter; and
(ii) the amount in dollars corresponding to the Variable Rate
component of the total Tipping Fee that is actually payable or
was paid to COMPANY from the Charter Municipalities in the
previous quarter, all divided by the tons of Acceptable Waste
that COMPANY estimates will be delivered by the Charter
Municipalities in the current quarter; minus
4. any adjustments for failure of the Facility to operate or to
meet the Performance Standards other than by reason of
Suspension of Operations, Force Majeure, or MUNICIPALITY
default; all
-65-
66
divided by the tons of Acceptable Waste that COMPANY estimates
will be delivered in such quarter; plus
5. any adjustments for Change-in-Law costs and Change in Rate of
Interest Cost, as converted to dollars per ton in accordance
with Section E below;
and where the amounts in items (2), (3) and (5) can be positive or negative.
B. For purposes of calculating Section A(2) above, Pass-through
Costs shall be defined as the sum of the following:
(1) Changes in the cost of Residue disposal. The difference
between (i) the sum of all fees, costs, expenses and liabilities that COMPANY
estimates it will incur or pay in respect of Residue disposal for the calendar
quarter (including but not limited to transportation costs), and (ii) the base
amount for Residue disposal which is $368,188.
(2) Changes in the cost of FEPR disposal. The difference
between (i) the sum of all fees, costs, and expenses and liabilities that
COMPANY estimates it will incur or pay in respect of FEPR disposal for the
calendar quarter (including but not limited to transportation costs), and (ii)
the base amount for FEPR disposal which is $526, 274.
C. For purposes of calculating Section A(4) above, the adjustments
for failure to meet the Performance Standards (for reasons other than Suspension
of Operations, Force Majeure or MUNICIPALITY default) shall be calculated in the
first quarter of each Operating Year on the basis of performance in the
preceding Operating Year. Such adjustments shall be defined as follows:
1. for failure to comply with the Residue Moisture Standard,
the actual costs of transportation and disposal associated with the excess tons.
2. for failure to comply with the Residue Combustible Content
Standard and/or the Ferrous Quality Standard, the actual costs of transportation
and disposal for the excess tons associated with excess combustible material.
-66-
67
3. for failure to comply with the Residue Truck Loading
Standard and/or the FEPR Truck Loading Standard, the cost of transportation
associated with the excess shipments.
4. for failure to comply with both the Glass and Grit Quantity
and Quality Standards, the actual costs of transportation and disposal, for the
excess tons provided that no adjustment shall be made unless the Facility has
failed to comply with both standards.
E. For purposes of the adjustments in Section A(5) above,
Changes-in-Law costs and Changes in Rate of Interest Costs shall be defined as
the sum of the following:
(1) Change-in-Law costs. The Change-in-Law costs for any
calendar quarter are the fees, costs, expenses and liabilities paid or incurred
by COMPANY during such calendar quarter, by reason of a Change-in-Law event
(including an allocated portion of capital expenditures and direct quantifiable
additions to operating or maintenance costs) but only as and to the extent such
fees, costs, expenses and liabilities in respect of any Change-in-Law event
exceeds $100,000 (whether or not paid in any calendar quarter). The
Change-in-Law costs to be included in any adjustments of the Variable Rate for
any calendar quarter may not exceed 25% of the Tipping Fee payable by
MUNICIPALITY for such calendar quarter (before giving effect to the inclusion of
the full amount thereof without reference to such limitation). Any Change-in-Law
costs which exceed the 25% cap in a particular calendar quarter shall be accrued
and be included as and to the extent permitted by the immediately preceding
sentence in the next succeeding calendar quarter(s) in which such inclusion will
not be prohibited by such limitation.
The amount of the Change-in-Law costs which is not received in a
calendar quarter by reason of such 25% limitation shall, together with interest
on the unpaid and unrecorded amount thereof at a rate per annum equal to the
rate of interest announced by Bank of Boston or its successor as its base or
prime rate of interest plus 2% per annum on the unrecovered amount thereof, be
thereafter treated as a Change-in-Law costs and included in any calculation
thereof until received in full. All calculations of Change-in-Law costs shall be
prepared on the basis that unpaid amounts of Change-in-Law costs from prior
calendar quarters
-67-
68
are the first ones to be included and recovered and Change-in-Law costs paid in
the calendar quarter in question are the last to be included and recovered.
Notwithstanding the foregoing, such 25% limitation shall not be applicable as
and to the extent that any Change-in-Law costs paid or incurred in the calendar
quarter would not be recovered by amortizing the amount thereof on an even
calendar quarter basis (based on the number of remaining calendar quarters) over
the period ending March 31, 2018.
In the event of a termination of this Agreement whether by COMPANY,
pursuant to Article VIII or Article XIII or by MUNICIPALITY, pursuant to Article
XIII, or pursuant to Article XI, MUNICIPALITY shall be required to pay COMPANY
an amount equal to its pro-rata share (based on the then Guaranteed Tonnage and
the Guaranteed Annual Tonnage of all Charter Municipalities) of any remaining
balances of Change-in-Law costs at the effective date of any such termination
which have not been recovered prior to such date; provided, however, that
MUNICIPALITY may at the effective date of such termination by written notice to
COMPANY elect to pay any such amount owing by it based on an even monthly
amortization of the amount thereof over a period of up to forty-eight (48)
months as MUNICIPALITY shall elect. Any amount to be amortized shall bear
interest at a rate per annual equal to the rate of interest announced by Bank of
Boston or its successor as its base or prime rate of interest plus 2% and shall
be payable at the time each such monthly payment is made.
(2) Changes in Rate of Interest cost. Changes in Rate of Interest
cost to be paid by COMPANY to the trustee of its presently outstanding bonds
shall be an amount equal to the aggregate difference between (i) the interest
expense of COMPANY to be paid or accrued in respect of the bonds as estimated by
COMPANY in respect of such calendar quarter, and (ii) the interest expense that
would have been paid or accrued in respect of the bonds during such calendar
quarter at a 6.40% constant rate; provided, however, that the interest rate used
in making the calculation in clause (i) shall in no event exceed the rate of
8.00% per annum. COMPANY will use its best efforts to fix the rate on the bonds
at a time and on a basis which is mutually agreeable between COMPANY and the
Municipal Review Committee the cost of which
-68-
69
fixing of interest rate shall be paid by Charter Municipalities, including
MUNICIPALITY, as a Pass-through Cost, in a manner which is agreeable to
Municipal Review Committee and COMPANY.
F. COMPANY will certify to the Municipal Review Committee the
validity of quarterly Pass-through Costs and deliver to the Municipal Review
Committee the certificate and the quarterly reconciliation statement with
accompanying invoices and other agreed-upon documentation within twenty (20)
days after the end of the calendar quarter so that the Municipal Review
Committee can review the reconciliation. The Municipal Review Committee will
have twenty (20) days from receipt of the statement to accept or dispute the
reconciliation. Unless the Municipal Review Committee files a written objection
to the statement with COMPANY within twenty (20) days of receiving the same,
setting forth the basis for such dispute, such statement shall be final and
binding on all parties, including MUNICIPALITY. If the Municipal Review
Committee files such written objection, the amount of the disputed items shall
not be included in Tipping Fee invoices, but the disputed items shall be
referred to binding arbitration for resolution as provided for in Article XXXII.
Adjustments to Pass-through Costs determined by resolution of the disputed items
shall be reflected in future invoices as referred to in paragraph A above.
G. Annual Projections of Tipping Fees. On or before September 15 of
each Operating Year, commencing with the Operating Year beginning January 1,
1992, or on such other date as shall be mutually acceptable to COMPANY and
MUNICIPALITY, COMPANY shall use its best efforts to notify MUNICIPALITY and the
Municipal Review Committee of COMPANY's then estimate of the Base Rate per ton
and the Variable Rate per ton, so that MUNICIPALITY may include in its budget
adequate contingency amounts to cover potential increases in its projected
Tipping Fees. Any such estimates shall not be binding on any of the parties.
-69-
70
SCHEDULE D
Procedure To Exercise Option To Purchase Facility under Article XVI,
Paragraph A
If the Municipal Review Committee, on behalf of the Charter
Municipalities, elects to purchase the Facility as permitted and provided in
Article XVI, Paragraph A of this Agreement, the notice of exercise of the Option
shall specify the date of the closing of the transfer of title from COMPANY to
Charter Municipalities or their designee, which closing shall occur within 180
days of the date of the written notice given by the Municipal Review Committee
under Article XVI, Paragraph A. At closing, COMPANY shall convey the Facility by
quitclaim deed with covenant and bills of sale with warranty covenants, free and
clear of all liens and encumbrances. Any liens and encumbrances including the
balances of any unpaid amounts secured by the mortgage to the trustee or any
provider of credit enhancement or support of bonds providing financing or
refinancing of the Facility or any portion thereof, together with all interest,
fees and costs due to the trustee and such providers secured thereby, shall be
paid in cash at closing.
The condition contained in the preceding sentence is for the benefit
of both parties and may not be waived by any party to this Agreement. The
parties shall make appropriate provisions for the orderly assumption of
executory contracts and reconcile real estate taxes and other such items on a
pro rata basis. Unless otherwise agreed prior to closing, the Charter
Municipalities will not be acquiring accounts receivable or assuming accounts
payable of COMPANY.
-70-
71
SCHEDULE E
Distributable Cash
For the purpose of calculating Performance Credits referred to in
Article XVIII of the Agreement for any period, amounts used to calculate
Distributable Cash shall be determined consistent with Generally Accepted
Accounting Principles and shall be derived from the following types of income
and expenses:
(1) all amounts received by COMPANY from Bangor Hydro in respect to
the sale of electricity to it during such period; provided, however, that to the
extent such funds constitute Equity Reserves (as defined in Article XVIII,
paragraph B), such funds and any investment income therefrom shall be
distributed one-half (50%) to the Amending Charter Municipalities and one-half
(50%) to the partners in the COMPANY as of the Closing Date, if and when
released to COMPANY;
(2) all sums received by COMPANY during such period in respect to
all Acceptable Waste delivered to COMPANY during such period;
(3) all amounts received by COMPANY in respect of the sale by it of
recoverable materials, steam or byproducts during such period; and
(4) all investment income of COMPANY earned (other than earnings on
monies in accounts maintained pursuant to this Agreement, the trust indenture
between the Finance Authority of Maine, or other issuer, and the bond trustees,
existing credit or other agreements between COMPANY and any provider of credit
enhancement or support for the bonds) during such period.
From the sum of the amounts and income set forth above, shall be
deducted the sum of all fees, costs, expenses and liabilities paid or incurred
by COMPANY in respect to such period including debt service, amounts deposited
into or credited to any account maintained pursuant to the trust indenture, the
credit agreements between COMPANY and any provider of credit enhancement or
support for the bonds, or this Agreement, any plant management fee allocable to
COMPANY or bonus payments paid or incurred by COMPANY
-71-
72
pursuant to the operating agreement between COMPANY and ESOCO Orrington, Inc. or
any subsequent operating agreement.
In the calculation of Distributable Cash, distributions to partners
of COMPANY in respect to any ownership interests in the partnership shall not be
considered to be a fee, a cost, an expense, or a liability. Further,
Distributable Cash shall not include:
(1) any 1990 through March 31, 1991 interim tipping fee payments or
any payments for this purpose made over time after March 31, 1991;
(2) amounts received from borrowing or drawing-down of letters of
credit;
(3) insurance or condemnation proceeds or awards;
(4) amounts received in satisfaction of claims;
(5) capital contributions and indemnity payments;
(6) debt service savings (including any reductions in letter of
credit or other credit enhancement fees or commissions or any remarketing fees)
resulting from the prepayment of bonds or other borrowings effected with
payments made by Equity Charter Municipalities under Article XIX, paragraph
(B)(5) of this Agreement; and
(7) any other amount not representing revenues received in the
ordinary course of business (including, without limitation, withdrawals from
accounts maintained under the trust indenture, credit or other agreements
between COMPANY and its lenders, or this Agreement); provided, however, that
funds, if any, remaining in the debt service reserve fund, capital improvement
reserve fund and operating reserve fund securing the bonds when released to
COMPANY shall be Distributable Cash; provided, further, however, to the extent
such reserve funds constitute Equity Reserves (as defined in Article XVIII,
paragraph B), such funds and any investment income therefrom shall be
distributed one-half (50%) to the Amending Charter Municipalities and one-half
(50%) to the partners in COMPANY as of the Closing Date, if and when released by
the Finance Authority of Maine or the trustee.
-72-
73
Distributable Cash shall be calculated in a manner consistent with
the description below. All capitalized terms not defined elsewhere in this
Agreement refer to specific line items in COMPANY's profit and loss operations
statements ("Operating P&L") as prepared monthly by COMPANY's controller in the
regular course of COMPANY's financial affairs and audited annually by an
independent accounting firm.
1. Start with Total Revenues.
2. Subtract the following summary line items:
a. Total Fixed Expenses;
b. Total Variable Expenses; and
c. Total Non-Operating Income Expenses.
3. Add back the following individual line items:
a. Depreciation; and
b. Amortization.
4. Subtract the following:
a. The principal paid on the outstanding bonds; and
b. The amount of debt service savings resulting from the
prepayment of bonds or other borrowings effected with
payments made by Equity Charter Municipalities under
Article XIX, paragraph (B)(5) of this Agreement.
5. Adjust for other cash and non-cash items and cash flow lags as
calculated and substantiated by COMPANY and otherwise not
incorporated into the Operating P&L.
In the event that COMPANY changes the definitions of line items on
its Operating P&L, it shall inform the Municipal Review Committee of such
changes, and appropriate adjustments to the calculation described above shall be
made by mutual agreement.
COMPANY shall submit its calculation of Distributable Cash and
Performance Credits to the Municipal Review Committee within sixty (60) days of
the close of each calendar quarter and within thirty (30) days of the completion
of the annual independent audit. Quarterly calculations of the amount of
Distributable Cash and Performance Credits for a year shall be subject to
adjustment and reconciled with the annual audit. Such submittal shall be
accompanied by the following:
-73-
74
1. A certificate signed by COMPANY's controller stating that he has
reviewed the submittal and the calculations, that the submittal is a correct
representation of the matters set forth and was prepared from data prepared in
accordance with Generally Accepted Accounting Principles consistent with
COMPANY's historical operating practices and in accordance with the terms of
this Agreement;
2. A certificate signed by an authorized officer of COMPANY that
COMPANY has complied with its obligations under this Agreement as they affect
the calculation of Performance Credits;
3. Company Operating P&L for the period;
4. A written statement setting forth the detailed calculation of the
Performance Credits;
5. A written statement setting forth the tons of Acceptable Waste
accepted from each Charter Municipality in the period.
-74-
75
SCHEDULE F
Performance Standards
1. THE RESIDUE MOISTURE STANDARD
The moisture in the Residue as shipped shall not exceed forty
percent (40%) by weight on an annual basis. The annual average shall
be the simple average of the results of analysis of compound
samples. The size of the samples, the frequency of sampling and
sample compounding and the procedures for storing and compounding
samples in waterproof containers shall be established by mutual
agreement of COMPANY and the Municipal Review Committee. Protocols
for analysis of the samples shall be in accordance with standard
American Society for Testing and Materials (ASTM) methods or
otherwise by mutual agreement of COMPANY and the Municipal Review
Committee.
2. THE RESIDUE COMBUSTIBLE CONTENT STANDARD
The percent weight of the unburned combustibles in the Residue as
measured by the percent LOI shall not exceed the Residue Combustible
Content Standard on an annual average basis. The Residue Combustible
Content Standard shall be set for 1991 at nine percent (9%) by
weight (dry), and shall be adjusted for Operating Years after 1991
by mutual agreement of COMPANY and the Municipal Review Committee
using the results of analysis of compound samples taken during 1991.
The size of the samples, the frequency of sampling and sample
compounding and the procedures for storing and compounding samples
in waterproof containers shall be established by mutual agreement of
COMPANY and the Municipal Review Committee. Protocols for analysis
of the samples shall be in accordance with standard ASTM methods or
otherwise by mutual agreement of COMPANY and the Municipal Review
Committee.
-75-
76
3. THE RESIDUE TRUCK LOADING STANDARD
The annual average net weight of shipments of Residue shall not be
less than twenty (20) tons per truck. Net weights and the number of
shipments shall be determined on the basis of monthly disposal
invoices as verified for accuracy.
4. THE FEPR TRUCK LOADING STANDARD
The annual average net weight of shipments of FEPR (including glass
and grit, non-processible waste, and to the extent that its disposal
costs are based on explicit payments for transportation on a per
truck basis, recovered ferrous materials) shall not be less than
twenty (20) tons per truck. Net weights and the number of shipments
shall be determined on the basis of monthly disposal invoices as
verified for accuracy.
5. THE FERROUS QUALITY STANDARD
The higher heating value (HHV) of the recovered ferrous materials as
measured by the ratio of the BTUs of the free combustibles to the
total weight of the recovered ferrous materials shall not exceed the
Ferrous Quality Standard on an annual average basis. The Ferrous
Quality Standard shall be set for 1991 at 940 BTU/lb on the basis of
ten percent (10%) free combustible content by weight at an assumed
HHV of 9400 BTU/lb, and shall be adjusted for Operating Years after
1991 by mutual agreement of COMPANY and the Municipal Review
Committee using the results of analysis of compound samples taken
during 1991. The size of the samples, the frequency of sampling and
sample compounding and the procedures for storing and compounding
samples in waterproof containers shall be established by mutual
agreement of COMPANY and the Municipal Review Committee. Protocols
for analysis of the samples shall be in
-76-
77
accordance with standard ASTM methods or otherwise by mutual
agreement of COMPANY and the Municipal Review Committee.
6. THE GLASS AND GRIT QUANTITY STANDARD
The weight of the glass and grit shall not exceed twenty-six percent
(26%) of the weight of all Acceptable Waste accepted at the Facility
(including nonprocessible waste) on an annual basis. The weights of
the glass and grit and the Acceptable Waste shall be determined on
the basis of monthly disposal invoices as verified for accuracy by
COMPANY.
7. THE GLASS AND GRIT QUALITY STANDARD
The Glass and Grit Quality Standard shall not be applicable unless
the Facility has not complied with the Glass and Grit Quantity
Standard. The HHV of the glass and grit shall not exceed the Glass
and Grit Quality Standard on an annual average basis. The Glass and
Grit-Quality Standard shall be set initially at 2088 BTU/lb and
shall be adjusted by mutual agreement of the COMPANY and the
Municipal Review Committee using the results of analysis of compound
samples taken during 1991. The size of the samples, the frequency of
sampling and sample compounding and the procedures for storing and
compounding samples in waterproof containers shall be established by
mutual agreement of COMPANY and the Municipal Review Committee.
Protocols for analysis of the samples shall be in accordance with
standard ASTM methods or otherwise by mutual agreement of COMPANY
and the Municipal Review Committee.
-77-
78
SCHEDULE G
Type of Vehicles
All vehicles depositing waste on the Facility tipping floor shall be
capable of discharging their loads mechanically. Included within the category of
vehicles permitted to tip are: standard solid waste packer trucks, transfer
trailers and hydraulic dump trucks. In addition, all solid waste vehicles
entering the Facility shall have their loads enclosed within a container or
covered securely by means of a tarp. No pick-up trucks, so-called, or other
vehicles which would require manual unloading, either by design or by reason of
malfunction, shall be permitted to discharge Acceptable Waste on the tipping
floor.
-78-
79
SCHEDULE H
[Deleted]
-79-
80
SCHEDULE H(1)
[Deleted]
-80-
81
SCHEDULE I
[Deleted]
-81-
82
SCHEDULE J
Pending or Threatened Litigation or Governmental Proceeding
1. [to come]
_. COMPANY during the conduct of its business is involved in
numerous governmental proceedings and investigations with respect to permits,
approvals and administrative matters relative to the ownership, operation and
maintenance of the Facility which, if adversely determined, could result
adversely and affect COMPANY's ability to operate the Facility.
TO BE UPDATED, IF NECESSARY, PRIOR TO CLOSING
-82-
83
SCHEDULE K
[Deleted]
-83-
84
ACKNOWLEDGMENT OF BANGOR HYDRO-ELECTRIC COMPANY
Bangor Hydro-Electric Company ("Bangor Hydro") hereby acknowledges
that it has received a copy of the foregoing Second Amended, Restated and
Extended Waste Disposal Agreement, dated as of ___________, 199_, between
[Municipality] and Penobscot Energy Recovery Company, Limited Partnership, and
that the references to the Common Stock Warrant and Registration Agreement
contained in Article XII, paragraph E of the Agreement are correct in all
material respects.
IN WITNESS WHEREOF, Bangor Hydro has caused its duly authorized
officer to execute this Acknowledgment as of the ____ day of ____________, 199_.
BANGOR HYDRO-ELECTRIC COMPANY
By /s/ Xxxxxx Xxxxxx
--------------------------------------
Its General Counsel, Secretary & Clerk
-84-
85
ACKNOWLEDGMENT AND AGREEMENT OF MUNICIPAL REVIEW COMMITTEE, INC.
Municipal Review Committee, Inc. (the "Municipal Review Committee")
hereby acknowledges receipt of a copy of the foregoing Second Amended, Restated
and Extended Waste Disposal Agreement, dated as of ___________, 199_, between
[Municipality] and Penobscot Energy Recovery Company, Limited Partnership, and
hereby agrees to undertake and perform all duties and responsibilities imposed
upon it by the provisions thereof.
IN WITNESS WHEREOF, the Municipal Review Committee has caused its
duly authorized officer to execute this Acknowledgment and Agreement as of the
____ day of ____________, 199_.
MUNICIPAL REVIEW COMMITTEE, INC.
By
By Xxxxxx Xxxxxx
--------------------------------------
Its President
-85-
