EXHIBIT 10.6.5
FINAL
FIFTH AMENDMENT TO CREDIT AND SECURITY AGREEMENT
THIS FIFTH AMENDMENT (the “Amendment”), dated March 13, 2009, is entered into by
and between PURE EARTH, INC., a Delaware corporation (“Pure Earth”) and all of
its wholly owned subsidiaries, including, but not limited to PURE EARTH
MATERIALS, INC., a Pennsylvania corporation, PURE EARTH TRANSPORTATION &
DISPOSAL, INC., a Delaware corporation, JUDA CONSTRUCTION, LTD., a New York
corporation, ECHO LAKE BROWNFIELD, LLC, a Connecticut limited liability company,
PEI DISPOSAL GROUP, INC., a Delaware corporation, and PURE EARTH MATERIALS (NJ),
INC., a Delaware corporation, (collectively, the “Borrower”), BIO METHODS, LLC,
a Delaware limited liability company, PURE EARTH ENVIRONMENTAL, INC., a
Connecticut corporation, HFH ACQUISITION CORP., a Delaware corporation, CASIE
ECOLOGY OIL SALVAGE, INC., a New Jersey corporation, REZULTZ, INCORPORATED, a
New Jersey corporation, MIDATLANTIC RECYCLING TECHNOLOGIES, INC., a Delaware
corporation, GEO METHODS, LLC., a Delaware limited liability company, PURE EARTH
ENERGY RESOURCES, INC., a Delaware corporation, and NEW NYCON, INC., a Delaware
corporation, and WELLS FARGO BANK, NATIONAL ASSOCIATION (the “Lender”), acting
through its Wells Fargo Business Credit operating division.
RECITALS
The Borrower and the Lender are parties to a Credit and Security Agreement dated
October 24, 2006 (as amended from time to time, the “Credit Agreement”).
Capitalized terms used in this Amendment have the meanings given to them in the
Credit Agreement unless otherwise specified.
NOW, THEREFORE, in consideration of the premises and of the mutual covenants and
agreements herein contained, it is agreed as follows:
1. The definition of “Adjusted Net Income” shall be added to Section 1.1 of the
Credit Agreement as follows:
“Adjusted Net Income” means Net Income (a) plus the amount of any income taxes
accrued and unpaid and deducted in the calculation of Net Income, (b) plus any
loss included in the calculation of Net Income arising from (i) Specified
Accounts, (ii) the book loss associated with the sale or other divestiture of
Equipment that is idle, obsolete, or otherwise not necessary for the current
operations of Borrowers’ business, in an aggregate amount per calendar year not
to exceed $1,000,000; (iii) GAAP-required adjustments to earnings arising from
stock options and warrants, restricted stock awards and other similar items,
(iv) goodwill and intangible asset impairments under GAAP, and (iv) non-cash
losses

 

 

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attributable to any outstanding interest rate swap obligations; (c) less any
gain included in the calculation of Net Income arising from GAAP-required
adjustments to earnings arising from stock options and warrants, restricted
stock awards and other similar items, (d) less the amount of any income tax
benefit included in the calculation of Net Income, and (e) less any non-cash
gains attributable to any outstanding interest rate swap obligations.
2. The definition of “Current Maturities of Long Term Debt” shall be added to
Section 1.1 of the Credit Agreement as follows:
“Current Maturities of Long Term Debt” means, during a period beginning and
ending on designated dates, the amount of Borrower’s long-term debt and
capitalized leases (excluding that portion of any capitalized lease obligations
allocable to interest expense) which become due during that period.
3. The definition of “Debt Service Coverage Ratio” shall be added to Section 1.1
of the Credit Agreement as follows:
“Debt Service Coverage Ratio” means (a) the sum of (i) Funds from Operations
plus (ii) Interest Expense minus (iii) Unfinanced Capital Expenditures, divided
by (b) the sum of (i) Current Maturities of Long Term Debt plus (ii) Interest
Expense, minus (iii) amounts paid on account of interest or principal from the
Susquehanna Reserve.
4. The definition of “Eligible Accounts” set forth in Section 1.1 of the Credit
Agreement shall be deleted in its entirety and replaced with the following:
“Eligible Accounts” means all unpaid Accounts of the Borrower arising from the
sale or lease of goods or the performance of services, net of any credits, but
excluding any such Accounts having any of the following characteristics:
(i) That portion of Accounts unpaid 90 days or more after the invoice date;
(ii) That portion of Accounts related to goods or services with respect to which
the Borrower has received notice of a claim or dispute, which are subject to a
claim of set-off or a contra account (to the extent of such claim of set-off or
contra account), or which reflect a reasonable reserve for warranty claims or
returns;
(iii) That portion of Accounts not yet earned by the final delivery of goods or
rendition of services, as applicable, by the Borrower to the customer, including

 

 

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progress billings, and that portion of Accounts for which an invoice has not
been sent to the applicable account debtor;
(iv) Accounts constituting (i) proceeds of copyrightable material unless such
copyrightable material shall have been registered with the United States
Copyright Office, or (ii) proceeds of patentable inventions unless such
patentable inventions have been registered with the United States Patent and
Trademark Office;
(v) Accounts owed by any unit of government, whether foreign or domestic
(provided, however, that there shall be included in Eligible Accounts that
portion of Accounts owed by such units of government for which the Borrower has
provided evidence satisfactory to the Lender that (A) the Lender has a first
priority perfected security interest and (B) such Accounts may be enforced by
the Lender directly against such unit of government under all applicable laws);
(vi) Accounts denominated in any currency other than United States dollars;
(vii) Accounts owed by an account debtor located outside the United States which
are not (A) backed by a bank letter of credit naming the Lender as beneficiary
or assigned to the Lender, in the Lender’s possession or control, and with
respect to which a control agreement concerning the letter-of-credit rights is
in effect, and acceptable to the Lender in all respects, in its sole discretion,
or (B) covered by a foreign receivables insurance policy acceptable to the
Lender in its sole discretion;
(viii) Accounts owed by an account debtor that is insolvent, the subject of
bankruptcy proceedings or has gone out of business;
(ix) Accounts owed by an Owner, Subsidiary, Affiliate, Officer or employee of
the Borrower;
(x) Accounts not subject to a duly perfected security interest in the Lender’s
favor or which are subject to any Lien in favor of any Person other than the
Lender;
(xi) That portion of Accounts that has been restructured, extended, amended or
modified;
(xii) That portion of Accounts that constitutes advertising, finance charges,
service charges or sales or excise taxes;
(xiii) Accounts owed by an account debtor, regardless of whether otherwise
eligible, to the extent that the aggregate balance of such Accounts exceeds
fifteen

 

 

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percent (15%) of the aggregate amount of all Accounts (with ineligibility under
this subsection limited to such excess);
(xiv) Accounts owed to the Borrower by Civetta Cousins, to the extent that the
aggregate balance of such Accounts exceeds $1,250,000 (with ineligibility under
this subsection limited to such excess);
(xv) Accounts owed to the Borrower by The Laquila Group;
(xvi) Accounts owed by an account debtor, regardless of whether otherwise
eligible, if twenty-five percent (25%) or more of the total amount of Accounts
due from such debtor is ineligible under clauses (i), (ii), or (x) above; and
(xvii) Accounts, or portions thereof, otherwise deemed ineligible by the Lender
in its sole reasonable discretion.”
5. The definition of “Fidus Transaction” shall be added to Section 1.1 of the
Credit Agreement as follows:
“Fidus Transaction” means that certain sale and issuance of Series B Preferred
Stock by Borrower to Fidus Mezzanine Capital L.P. (“Fidus”) and other
transactions contemplated by that certain Investment Agreement among Pure Earth
and Fidus dated as of March 4, 2008.
6. The definition of “Floating Rate” set forth in Section 1.1 of the Credit
Agreement shall be deleted in its entirety and replaced with the following:
“Floating Rate” means an annual interest rate equal to the sum of the Prime Rate
plus two and three quarters percent (2.75%), which interest rate shall change
when and as the Prime Rate changes.
7. The definition of “Funds from Operations” shall be added to Section 1.1 of
the Credit Agreement as follows:
“Funds from Operations” means for a given period, the sum, without duplication,
of (a) Adjusted Net Income, (b) depreciation and amortization, (c) any increase
(or decrease) in deferred income taxes, (d) any increase (or decrease) in lifo
reserves, and (e) other non-cash items, each as determined for such period in
accordance with GAAP.

 

 

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8. The definition of “Interest Expense” shall be added to Section 1.1 of the
Credit Agreement as follows:
“Interest Expense” means for a fiscal year-to-date period, Borrower’s total
gross interest expense during such period (excluding interest income), and shall
in any event include (a) interest expensed (whether or not paid) on all Debt,
but specifically excluding dividends (treated as interest under GAAP)
paid-in-kind in connection with Series B Preferred Stock issued in the Fidus
Transaction, (b) the amortization of debt discounts (excluding debt discounts in
connection with the Fidus Transaction), (c) the amortization of all fees payable
in connection with the incurrence of Debt to the extent included in interest
expense (excluding transaction fees paid in connection with the Fidus
Transaction, the Susquehanna Bank Financing and any financing with the Lender),
(d) the portion of any capitalized lease obligation allocable to interest
expense, and (e) cash dividends actually paid on the Series A Preferred Stock.
9. The definition of “Interest Period” set forth in Section 1.1 of the Credit
Agreement shall be deleted in its entirety and replaced with the following:
“Interest Period” means the period that commences on (and includes) the Business
Day on which either a LIBOR Advance is made or continued or on which a Floating
Rate Advance is converted to a LIBOR Advance, and ending on (but excluding) the
Business Day numerically corresponding to such date that is three months
thereafter, as designated by the Borrower, but in no event maturing after the
Maturity Date, during which period the outstanding principal balance of the
LIBOR Advance shall bear interest at the LIBOR Advance Rate; provided, however,
that:
(a) No Interest Period may be selected for an Advance for a principal amount
less than Five Hundred Thousand Dollars ($500,000) with an initial Advance of
not less than One Million Dollars ($1,000,000), and no more than two
(2) different Interest Periods may be outstanding at any one time;
(b) If an Interest Period would otherwise end on a day which is not a Business
Day, then the Interest Period shall end on the next Business Day thereafter,
unless that Business Day is the first Business Day of a month, in which case the
Interest Period shall end on the last Business Day of the preceding month);
(c) No Interest Period applicable to a Revolving Advance may end later than the
Maturity Date; and
(d) In no event shall the Borrower select Interest Periods with respect to
Advances which, in the aggregate, would require payment of a contracted funds
breakage fee under this Agreement in order to make required principal payments.

 

 

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10. The definition of “LIBOR Advance Rate” set forth in Section 1.1 of the
Credit Agreement shall be deleted in its entirety and replaced with the
following:
“LIBOR Advance Rate” means an annual interest rate equal to the sum of LIBOR
plus three hundred (300) basis points.
11. The definition of “New Equity Account” set forth in Section 1.1 of the
Credit Agreement shall be deleted in its entirety and replaced with the
following:
“New Equity Account” means the deposit account into which the Borrower has
deposited or may deposit the New Equity, specifically, Wells Fargo Bank, N.A.
account number 13061585. No other account may contain New Equity.
12. The definition of “Prime Rate” set forth in Section 1.1 of the Credit
Agreement shall be deleted in its entirety and replaced with the following:
“Prime Rate” means at any time the greater of (i) five percent (5.00%) or
(ii) the rate of interest most recently announced by the Lender at its principal
office as its prime rate, with the understanding that the prime rate is one of
the Lender’s base rates, and serves as the basis upon which effective rates of
interest are calculated for those loans making reference thereto, and is
evidenced by the recording thereof in such internal publication or publications
as the Lender may designate. Each change in the rate of interest shall become
effective on the date each prime rate change is announced by the Lender.
13. The definition of “Specified Accounts “ and “Specified Matters” shall be
added to Section 1.1 of the Credit Agreement as follows:
“Specified Accounts” means those certain accounts due to Borrowers set forth
with particularity on Exhibit A to the Fifth Amendment.
“Specified Matters” means those certain matters set forth in a letter dated the
date hereof from Borrowers to Lender.
14. The definitions of “Susquehanna Bank Financing” and “Susquehanna Reserve”
shall be added to Section 1.1 of the Credit Agreement as follows:
“Susquehanna Bank Financing” means that certain financing transaction more fully
described in that certain Term Loan Agreement dated November 12, 2008, among
Susquehanna Bank, Casie Ecology Oil Salvage, Inc., Rezultz, Incorporated, and
Midatlantic Recycling Technologies, Inc..
“Susquehanna Reserve” means the reserve account established at and for the
benefit of Susquehanna Bank pursuant to the Susquehanna Bank Financing, into

 

 

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which the borrowers thereunder deposited $720,000, representing the first six
monthly payments due in connection with the Susquehanna Bank Financing.
15. The definition of “Tangible Net Worth” set forth in Section 1.1 of the
Credit Agreement shall be deleted in its entirety and replaced with the
following:
“Tangible Net Worth” means the Book Net Worth less the sum of (i) Intangible
Assets (excluding $2,200,000 of the value of permits held by Casie Ecology Oil
Salvage, Inc.) and (ii) prepaid expenses in excess of $200,000 not included in
Intangible Assets, plus losses recognized by Borrowers that adversely affect the
Borrowers’ Book Net Worth arising from (i) Specified Accounts, (ii) the sale or
other divestiture of Equipment that is idle, obsolete, or otherwise not
necessary for the current operations of Borrowers’ business, in an aggregate
amount per calendar year not to exceed $1,000,000, (iii) GAAP-required
adjustments to earnings arising from stock options and warrants, restricted
stock awards and other similar items and (iv) non-cash losses attributable to
any outstanding interest rate swap obligations.
16. The definition of “Unfinanced Capital Expenditures” shall be added to
Section 1.1 of the Credit Agreement as follows:
“Unfinanced Capital Expenditures” means for a period, any expenditure of money
during such period for the purchase or construction of assets, or for
improvements or additions to such assets, which are not financed with borrowed
funds and are capitalized on Borrower’s balance sheet.
17. Section 2.6(h) of the Credit Agreement shall be deleted in its entirety.
18. Section 2.7(b) of the Credit Agreement shall be deleted in its entirety and
replaced with the following:
(b) Collateral Exam Fees. The Borrower shall pay the Lender fees in connection
with any collateral exams, audits or inspections conducted by or on behalf of
the Lender of any Collateral or the Borrower’s operations or business at the
rates established from time to time by the Lender as its collateral exam fees
(which fees are currently $1,000 per day per collateral examiner), together with
all actual out-of-pocket costs and expenses incurred in conducting any such
collateral examination or inspection.
19. Section 2.7(e) of the Credit Agreement shall be deleted in its entirety and
replaced with the following:
(e) Termination and Line Reduction Fees. If (i) the Lender terminates the Credit
Facility during a Default Period, or if (ii) the Borrower terminates or

 

 

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reduces the Credit Facility on a date more than ninety (90) days prior to the
Maturity Date, then the Borrower shall pay the Lender as liquidated damages and
not as a penalty a termination fee in an amount equal to one percent (1%) of the
Maximum Line Amount (or the reduction of the Maximum Line Amount, as the case
may be).
20. Section 6.2 of the Credit Agreement shall be deleted in its entirety and
replaced with the following:
Section 6.2 Financial Covenants.
(a) Minimum Adjusted Net Income. Borrower shall achieve, for each period
described below, Adjusted Net Income of not less than the amount set forth for
each such period (numbers appearing between “< >” are negative):

              Minimum Net   Period   Income  
Quarter Ending June 30, 2009
  $ (2,120,000 )
Quarter Ending September 30, 2009
  $ (1,018,000 )

(b) Minimum Availability. Borrower shall maintain Availability of not less than
$350,000 at all times through June 30, 2009. After June 30, 2009, Borrower shall
maintain Availability of not less than $500,000 at all times.
(c) Minimum Debt Service Coverage Ratio. Borrower shall maintain, during each
period described below, a cumulative Debt Service Coverage Ratio, determined as
at the end of each period, of not less than the ratio set forth for each such
period:

              Min. Debt       Service   Period   Coverage Ratio  
Cumulative six months ending June 30, 2009
    .54 to 1.00  

 

 

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              Min. Debt       Service   Period   Coverage Ratio  
Cumulative nine months ending September 30, 2009
    1.25 to 1.00  

(d) Minimum Tangible Net Worth. Borrower shall have Tangible Net Worth,
determined as of the end of each period, in an amount not less than the amount
set forth for each such period (numbers appearing between “< >” are negative):

              Minimum       Book Net   Period   Worth  
Quarter Ending March 31, 2009
  $ 2,864,000  
Quarter Ending June 30, 2009
  $ 3,434,000  
Quarter Ending September 30, 2009
  $ 3,986,000  

(e) Capital Expenditures. The Borrower will not incur or contract to incur
unfinanced Capital Expenditures of more than $500,000 in the aggregate during
any fiscal year.
21. Section 6.6 of the Credit Agreement shall be amended to delete subsection
(e) and amend and restate subsection (d) as follows:.
“(d) Current investments in Casie’s 50%-owned subsidiary, Advanced Catalyst
Recycling, LLC (“ACR”), plus additional investments (i) in the form of debt or
cash advances, as and to the extent approved in advance by the Lender in
writing, or (ii) by virtue of the provision of goods and services on open
account for the benefit of ACR, as determined by Borrower in the ordinary course
of

 

 

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business, not to exceed in the aggregate, $500,000 during any calendar year or
as approved by the Lender in writing; provided, however, that amounts recorded
on the books of Borrower pursuant to GAAP as investments in ACR, as a result of
the application of the equity method of accounting for ACR, to the extent not as
a result of the actual provision of goods, services or capital to ACR, will not
be considered as investments therein for purposes of this Section 6.6.”
22. New Equity Account.
a. On or before October 21, 2008, the Borrower transferred all New Equity into
the New Equity Account (the “Transferred Funds”).
b. The Transferred Funds shall cease to be New Equity.
c. Nine hundred thousand dollars ($900,000) of the Transferred Funds has been
applied to the Indebtedness with a permanent reserve in the amount thereof to be
applied to the Borrowing Base (the “NE Reserve”). For purposes of calculating
the Unused Line Fee, the NE Reserve will be treated as an outstanding borrowing
and added to Revolving Advances and the LC Amount. The remaining Transferred
Funds has been applied to and in reduction of the Indebtedness, and may be
utilized to fund working capital, capital expenses and/or acquisitions that are
approved by Lender, with approval of such acquisitions not to be unreasonably
withheld or delayed.
d. The Borrower shall be permitted to raise New Equity without the consent of
Lender so long as and to the extent that (i) such New Equity does not provide
for or require the current payment of a cash dividend/distribution or (ii) if
such New Equity does so provide for or require the current payment of a cash
dividend/distribution, the holder(s) of such New Equity, as a precondition to
becoming a holder, executes a subordination agreement, acceptable to Lender in
its sole reasonable discretion, pursuant to which the payment of any cash
dividend/distribution otherwise required or permitted to be paid in connection
with such New Equity (so long as no Default or Event of Default has occurred or
would occur as a result of such payment) is subject to the prior written consent
of Lender. New Equity that does not meet the requirement set forth above may
only be raised by the Borrower upon the consent of Lender, as determined in
Lender’s sole discretion.
23. Acknowledgement of Specified Matters Lender hereby waives performance under
the Credit Agreement with respect to the Specified Matters.
24. Schedule 5.1 of the Credit Agreement shall be deleted and replaced with
Schedule 5.1 attached hereto.
25. Schedule 5.2 of the Credit Agreement shall be deleted and replaced with
Schedule 5.2 attached hereto.

 

 

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26. Schedule 5.5 of the Credit Agreement shall be deleted and replaced with
Schedule 5.5 attached hereto.
27. Schedule 5.7 of the Credit Agreement shall be deleted and replaced with
Schedule 5.5 attached hereto.
28. Schedule 5.12 of the Credit Agreement shall be deleted and replaced with
Schedule 5.12 attached hereto.
29. Schedule 6.3 of the Credit Agreement shall be deleted and replaced with
Schedule 6.3 attached hereto.
30. Schedule 6.4 of the Credit Agreement shall be deleted and replaced with
Schedule 6.4 attached hereto.
31. Formation of Pure Earth Energy Resources, Inc. The Borrower’s formation of
PE Energy, as a wholly owned subsidiary, is approved and consented to. Pure
Earth Energy Resources, Inc. shall become a Borrower.
32. New Borrowers. Bio Methods, LLC, Pure Earth Environmental, Inc., HFH
Acquisition Corp., Casie Ecology Oil Salvage, Inc.(“Casie”), Rezultz,
Incorporated (“Rezultz”), MidAtlantic Recycling Technologies, Inc. (“MART”), GEO
Methods LLC, Pure Earth Energy Resources, Inc. and New Nycon, Inc., by execution
and delivery of this Amendment, will become Borrowers under the Credit Agreement
and each such new Borrower (other than Casie, MART and Rezultz; collectively the
“Casie Group”) hereby pledges, assigns and grants to Lender a lien and security
interest in the Collateral. The Casie Group hereby pledges, assigns and grants
to Lender a lien and security interest only in the Revolver Collateral, as such
term is defined in the Susquehanna Bank Financing Term Loan Agreement. If deemed
eligible, the Accounts of the foregoing shall become part of the Borrowing Base.
33. Consummation of HFH Hawthorne Acquisition. Pure Earth Inc. may, upon the
terms set forth in the Lender’s December 3, 2008 letter to the Borrower,
consummate and/or cause its subsidiary, HFH Acquisition Corp. (“HFH
Acquisition”) to consummate the transactions contemplated by that certain
Membership Interest Purchase Agreement, dated January 14, 2008, among HFH
Acquisition, Land Resource Solutions, LLC and HFH Hawthorne LLC, as amended by
that certain letter dated November 26, 2008 among the parties thereto and
provided to the Lender.
34. No Other Changes. Except as explicitly amended by this Amendment, all of the
terms and conditions of the Credit Agreement shall remain in full force and
effect and shall apply to any advance or letter of credit thereunder.
35. Amendment Fee. The Borrower shall pay the Lender a fully earned,
non-refundable fee in the amount of $175,000 in consideration of the Lender’s
execution and delivery

 

 

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of this Amendment with $125,000 having been paid and the remainder payable (1)
$25,000 on date of this Amendment; and (2) the balance of $25,000, payable on
the Termination Date.
36. Conditions Precedent. This Amendment shall be effective when the Lender
shall have received an executed original hereof, together with each of the
following, each in substance and form acceptable to the Lender in its sole
discretion:
(a) A Certificate of the Secretary of the Pure Earth (i) certifying to the
resolutions of the board of directors of Pure Earth approving the execution and
delivery of this Amendment, copies of which will be attached to such
certificate; (ii) certifying to and attaching true and correct copies of the
articles of incorporation and or certificates of formation or other
organizational documents of Pure Earth and each of the other borrowers;
(iii) certifying to and attaching true and correct copies of the bylaws of Pure
Earth and the bylaws or operating agreements, as the case may be, for each of
the other Borrowers; (iv) certifying that the officers of Pure Earth and of each
Borrower set forth on a schedule to such Certificate, have the due authority to
sign and to act on behalf of Pure Earth and each such other Borrower in
connection with the execution and delivery of this Amendment and all other
documents, agreements and certificates on behalf of Pure Earth and each such
Borrower.
(b) The Wholesale Lockbox and Collection Account Agreement executed by the
Borrower.
37. Representations and Warranties. The Borrower hereby represents and warrants
to the Lender as follows:
(a) The Borrower has all requisite power and authority to execute this Amendment
and any other agreements or instruments required hereunder and to perform all of
its obligations hereunder, and this Amendment and all such other agreements and
instruments has been duly executed and delivered by the Borrower and constitute
the legal, valid and binding obligation of the Borrower, enforceable in
accordance with its terms.
(b) The execution, delivery and performance by the Borrower of this Amendment
and any other agreements or instruments required hereunder have been duly
authorized by all necessary corporate action and do not (i) require any
authorization, consent or approval by any governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, (ii) violate any
provision of any law, rule or regulation or of any order, writ, injunction or
decree presently in effect, having applicability to the Borrower, or the
articles of incorporation or by-laws of the Borrower, or (iii) result in a
breach of or constitute a default under any indenture or loan or credit
agreement or any other agreement, lease or instrument to which the Borrower is a
party or by which it or its properties may be bound or affected.

 

 

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(c) All of the representations and warranties contained in Article V of the
Credit Agreement are correct on and as of the date hereof as though made on and
as of such date, except to the extent that such representations and warranties
relate solely to an earlier date.
38. References. All references in the Credit Agreement to “this Agreement” shall
be deemed to refer to the Credit Agreement as amended hereby; and any and all
references in the Security Documents to the Credit Agreement shall be deemed to
refer to the Credit Agreement as amended hereby.
39. Release. The Borrower hereby absolutely and unconditionally releases and
forever discharges the Lender, and any and all participants, parent
corporations, subsidiary corporations, affiliated corporations, insurers,
indemnitors, successors and assigns thereof, together with all of the present
and former directors, officers, agents and employees of any of the foregoing,
from any and all claims, demands or causes of action of any kind, nature or
description, whether arising in law or equity or upon contract or tort or under
any state or federal law or otherwise, which the Borrower has had, now has or
has made claim to have against any such person for or by reason of any act,
omission, matter, cause or thing whatsoever arising from the beginning of time
to and including the date of this Amendment, whether such claims, demands and
causes of action are matured or unmatured or known or unknown.
40. Costs and Expenses. The Borrower hereby reaffirms its agreement under the
Credit Agreement to pay or reimburse the Lender on demand for all costs and
expenses incurred by the Lender in connection with the Loan Documents, including
without limitation all reasonable fees and disbursements of legal counsel.
Without limiting the generality of the foregoing, the Borrower specifically
agrees to pay all fees and disbursements of counsel to the Lender for the
services performed by such counsel in connection with the preparation of this
Amendment and the documents and instruments incidental hereto. The Borrower
hereby agrees that the Lender may, at any time or from time to time in its sole
discretion and without further authorization by the Borrower, make a loan to the
Borrower under the Credit Agreement, or apply the proceeds of any loan, for the
purpose of paying any such fees, disbursements, costs and expenses and the fee
required under Paragraph 35 of this Amendment.
41. Miscellaneous. This Amendment may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an original and all
of which counterparts, taken together, shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed as of the date first above written.

                  WELLS FARGO BANK,
NATIONAL ASSOCIATION       PURE EARTH, INC.

 

 

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By:
  /s/ Alan I. Cohen       By:   /s/ Brent Kopenhaver
 
               
 
  Alan I. Cohen           Brent Kopenhaver
 
  Its Vice President           Its Executive Vice President and Treasurer
 
                GEO METHODS, LLC       PURE EARTH ENERGY RESOURCES, INC.
 
               
By:
  /s/ Brent Kopenhaver       By:   /s/ Brent Kopenhaver
 
               
 
  Brent Kopenhaver           Brent Kopenhaver
 
  Its Treasurer           Its Treasurer
 
                CASIE ECOLOGY OIL SALVAGE, INC.       NEW NYCON, INC.
 
               
By:
  /s/ Brent Kopenhaver       By:   /s/ Brent Kopenhaver
 
               
 
  Brent Kopenhaver           Brent Kopenhaver
 
  Its Treasurer           Its Treasurer
 
                REZULTZ, INCORPORATED       MIDATLANTIC RECYCLING TECHNOLOGIES,
INC.
 
               
By:
  /s/ Brent Kopenhaver       By:   /s/ Brent Kopenhaver
 
               
 
  Brent Kopenhaver           Brent Kopenhaver
 
  Its Treasurer           Its Treasurer
 
                BIO METHODS, LLC.       PURE EARTH ENVIRONMENTAL, INC.
 
               
By:
  /s/ Brent Kopenhaver       By:   /s/ Brent Kopenhaver
 
               
 
  Brent Kopenhaver           Brent Kopenhaver
 
  Its Treasurer           Its Treasurer

 

 

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                  HFH ACQUISITION CORP.       JUDA CONSTRUCTION, LTD
 
               
By:
  /s/ Brent Kopenhaver       By:   /s/ Brent Kopenhaver
 
               
 
  Brent Kopenhaver           Brent Kopenhaver
 
  Its Treasurer           Its Treasurer
 
                PURE EARTH TRANSPORTATION AND DISPOSAL, INC.       PURE EARTH
MATERIALS, INC.
 
               
By:
  /s/ Brent Kopenhaver       By:   /s/ Brent Kopenhaver
 
               
 
  Brent Kopenhaver           Brent Kopenhaver
 
  Its Treasurer           Its Treasurer
 
                PURE EARTH MATERIALS, (NJ) INC.       PEI DISPOSAL GROUP, INC.
 
               
By:
  /s/ Brent Kopenhaver       By:   /s/ Brent Kopenhaver
 
               
 
  Brent Kopenhaver
Its Treasurer           Brent Kopenhaver
Its Treasurer
 
                ECHO LAKE BROWNFIELD, LLC.            
 
               
By:
  /s/ Brent Kopenhaver            
 
               
 
  Brent Kopenhaver            
 
  Its Treasurer