AMENDMENT NO. 2 TO INDEMNIFICATION AGREEMENT
THIS AMENDMENT NO. 2 to the Indemnification Agreement is made
as of the 1st day of November, 2002 (as supplemented or modified from time to
time, this "Agreement") by and among AJG Financial Services, Inc., by its Vice
President, General Counsel, as agent (the "Major Shareholder Agent") for Xxxxxxx
X. Xxxxxx, Finova Mezzanine Capital Corp., AJG Financial Services, Inc., ("AJG")
Environmental Opportunities Fund (for itself and as successor to) Environmental
Opportunities Fund Cayman, Xxxxxxx Xxxx, M&R Associates, Xxxxxx X. Xxxxxxxx,
Xxxxxxx X. Xxxxxxxxx and Xxxxxxx X. Xxxxxxx (each, an "Initial Major
Shareholder"), Xxxxxxx Xxxxxxxxx, Xxxxxx Alternative Power Corporation, a
Delaware corporation ("ZAPCO "), U.S. Energy Systems, Inc., a Delaware
corporation ("USE"), and Cinergy Energy Solutions, Inc., a Delaware corporation
("CES"). Unless indicated otherwise, capitalized terms shall have the same
meanings herein as they have in the Indemnification Agreement (as defined
below).
W I T N E S S E T H:
WHEREAS, the parties hereto, the Initial Major Shareholders
and USE Acquisition Corp, which was merged into ZAPCO, have previously entered
into that certain Indemnification Agreement dated as of November 28, 2000 (as
amended by Amendment No. 1 dated as of May 11, 2001, the "Indemnification
Agreement");
WHEREAS, the parties hereto now wish to amend the
Indemnification Agreement:
NOW, THEREFORE, in consideration of $10.00 and other
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Section 4(a)(i) of the Indemnification Agreement is hereby
amended by deleting the existing section in its entirety
and inserting in its place the following section:
i. unless a Notice of Claim (as defined herein) has been
delivered to the Major Shareholders, on or prior to the date which is
twenty one months after the Closing Date provided that notwithstanding
anything to the contrary in this Section 4(a)(i) Notices of Claim
arising from or relating to breaches of Section 3.10, 3.17 and 3.20 of
the Merger Agreement may be delivered prior to the sixth anniversary of
the Closing Date;
2. Clause (i) in Section 4(a) of the Indemnification
Agreement following "The ZAPCO Indemnitees shall not be
entitled to recover under Section 3(b):" is hereby amended
by deleting the existing clause in its entirety and
inserting in its place the following clause:
i. unless a Notice of Claim (as defined herein) has been
delivered to the Beneficiaries, on or prior to the date which is twenty
one months after the Closing Date except that Notices of Claim arising
from or relating to the breaches of Sections 4.09, 4.15 and 4.18 of the
Merger Agreement may be delivered prior to the sixth anniversary of the
Closing Date;
3. Except as amended hereby, the Indemnification Agreement is
hereby ratified and confirmed and, as so amended, remains
in full force and effect on the date hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be Executed as of the date first written above.
U.S. ENERGY BIOGAS CORPORATION
By: /s/Xxxxx Xxxxxxxxxx
----------------
Name: Xxxxx Xxxxxxxxxx
Title: Treasurer
MAJOR SHAREHOLDER AGENT:
By: /s/ Xxxx X. Xxxxxxxxx
-------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President &
General Counsel for
AJG Financial Services, Inc.
CINERGY ENERGY SOLUTIONS, INC.:
By: /s/ Xxxxx Xxxxxxxxx
---------------
Name: Xxxxx Xxxxxxxxx
Title:Vice President
U.S. ENERGY SYSTEMS, INC.:
By: /s/ Xxxxx Xxxxxxx
-------------------------
Name: Xxxxx Xxxxxxx
Title: Chief Executive Officer
