RIDGEWOOD POWER CORPORATION
November 15, 1996
Xx. Xxxxxx X. Xxxxx
Consolidated Hydro, Inc.
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, XX 00000
Xxxxxx Xxxxxxx Xxxxxxx Broder & Micoleau LLC
Xxx Xxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxxx, XX 00000
Att: Xxxxxxx X. Xxxxxxxxx, Esq.
Dear Sirs:
This letter will confirm our agreements in connection with the Closing
of the Merger Agreement (the "Merger Agreement") dated as of July 1, 1996 by and
among Consolidated Hydro Maine, Inc. ("CHI Maine"), CHI Universal, Inc.
("Universal"), Consolidated Hydro, Inc. ("Parent"), Ridgewood Maine Hydro
Corporation (the "General Partner') and Ridgewood Hydro Maine Partners, L.P.
(the "Partnership") and the Option and Escrow Agreement between Universal,
Ridgewood Electric Power Trust IV, a Delaware Business Trust (the "Trust") and
Xxxxxx Xxxxxxx Xxxxxxx Broder & Micoleau LLC (the "Escrow Agent") attached to
the Merger Agreement as Exhibit D. Capitalized terms used herein (unless
otherwise indicated) shall have the meanings assigned in the Merger Agreement.
1. The parties have executed the Merger Agreement, the Option
Agreement and the other Closing Documents referred to therein to
be executed by them and have delivered same to the Escrow Agent
to be held in escrow hereunder pending the receipt by the parties
of certain consents and other items necessary to satisfy the
conditions to the Closing under the Merger Agreement. Such
consents include, specifically, the consent of the Federal Energy
Regulatory Commission to the transactions contemplated by the
Merger Agreement.
2. The parties to the Merger Agreement hereby agree to amend the
Merger Agreement as follows:
Xx. Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxx, Esq.
November 15, 1996
Page 2
a. The last paragraph of Section 3.2.4 is amended by deleting the
phrase "Six Million One Hundred Fifty-Five Thousand Ninety-Four
Dollars ($6,155,094)" and inserting the phrase "Six Million Two
Hundred Forty-Three Thousand Three Dollars ($6,243,003)" in lieu
thereof in order to reflect the parties estimate of a December 2,
1996 Closing Date.
b. Section 5.4(ii) is amended by deleting the phrase "for the nine
month period ended March 31, 1996" and inserting the phrase "for
the fiscal year ended June 30, 1996" in lieu thereof.
c. The second sentence of Section 5.4 is amended by inserting the
phrase "and except that the balance sheets and income statements
of the Projects do not reflect any allocable portion of the
writedown of assets required by SFAS 121 which was recorded on
the books of CHI Maine."
d. Section 5.5 is amended by deleting the phrase "Since March 31,
1996" in the first line thereof and inserting the phrase "Since
June 30, 1996" in lieu thereof.
e. Section 10.5.4 is amended by:
(i) deleting the phrase "October 15, 1996" in the second line
thereof and inserting "December 31, 1996" in lieu thereof;
and
(ii) placing a period after the end of the parenthetical phrase
ending with the word "control" in the fourth line thereof
and deleting the remainder of Section 10.5.4.
3. Each of the General Partner and the Partnership hereby waives the
closing condition set forth in Section 7.13 of the Merger
Agreement.
4. The Trust hereby assigns to Ridgewood Electric Power Trust V
("Power Trust V"), a Delaware business trust which is an
Affiliate of the Trust, all of the Trust's right, title and
interest in, to and under the Option Agreement. Power Trust V
hereby accepts such assignment from the Trust, and agrees that
effective upon the closing of the Merger Agreement,
Xx. Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxx, Esq.
November 15, 1996
Page 3
Power Trust V shall immediately exercise the Trust Option to
acquire the Universal Securities (as such terms are defined in
the Option Agreement) by payment of the amount of Cash
Consideration described in Section l(a) of the Option
Agreement. Each of Universal and the Escrow Agent hereby
acknowledges that the above assignment is being made in
accordance with Section 10.2 of the Option Agreement. 5. Upon
receipt of the consent of the Federal Energy Regulatory
Commission and the satisfaction (or waiver by the appropriate
party) of the other conditions to the Closing of the Merger
Agreement, the Escrow Agent will date and file the Certificate
of Merger in the Office of the Secretary of State of the State
of Delaware, and immediately upon the effectiveness of such
filing the Escrow Agent shall make the distributions and
transfers described in paragraph 6(d) below.
6. Contemporaneously with the execution of this letter agreement,
each of the Trust and Power Trust V have made a transfer of
immediately available funds to the Escrow Agent to be held in
escrow hereunder on the following terms:
a. The amount transferred by each of the Trust and Power Trust
V is Six Million Two Hundred Forty-Three Thousand Three
Dollars ($6,243,003).
b. Such funds are to be held by the Escrow Agent and invested
in United States Treasury Bills pending the Closing under
the Merger Agreement.
c. In the event that the Closing under the Merger Agreement
shall occur after December 2, 1996, each of the Trust and
Power Trust V shall deliver to the Escrow Agent an
additional sum of Two Thousand Eight Hundred Fifty-Two
Dollars ($2,852) for each day after December 2, 1996 that
such Closing is delayed.
d. Upon the effectiveness of the filing of the Certificate of
Merger as described in paragraph 5 above, the Escrow Agent
will make the following transfers and deliveries to the
addresses specified in Section 10.9 of the Option Agreement:
(i) to Universal, the sum of (x) Six Million Two Hundred
Forty-Three Thousand Three Dollars
Xx. Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxx, Esq.
November 15, 1996
Page 4
($6,243,003) plus (y) 50% of any amounts
received pursuant to Section 6(c) above,
which amount represents the payment by the
Partnership of the estimated Cash
Consideration contemplated by Section 3.2.4
of the Merger Agreement;
(ii) to Universal, an Additional sum of (x) Six Million Two
Hundred Forty-Three Thousand Three Dollars ($6,243,003)
plus (y) 50% of any amounts received by the Escrow
Agent pursuant to Section 6(c) above, which amounts
represent the payment by Power Trust V (as assignee of
the Trust) of the Trust Exercise Price referred to in
Section 1 (a) of the Option Agreement;
(iii) to each of the Trust and Power Trust V, an amount
equal to 50% of the balance of any funds held by the
Escrow Agent;
(iv) to the Trust, the Trust Deposits (as defined in the
Option Agreement);
(v) to Power Trust V, deliver the Universal Deposits (as
defined in the Option Agreement); and
(vi) to each of the Partnership and Universal, at least one
executed copy of the Merger Agreement and the other
executed Closing Documents held by the Escrow Agent.
e. If the Closing under the Merger Agreement has not occurred
by December 31, 1996, then on January 2, 1997 the Escrow
Agent shall (i) return all sums transferred to it by the
Partnership and Power Trust V pursuant to paragraph 6(a)
above (including any interest earned therein) to the Trust,
(ii) deliver the Trust Deposits and the Universal Deposits
to the Trust and (iii) destroy the executed copies of the
Merger Agreement, Certificate of Merger and other Closing
Documents held by the Escrow Agent shall (i) return all sums
transferred to it by the Partnership and Power Trust V
pursuant to paragraph 6(a) above (including any
Xx. Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxx, Esq.
November 15, 1996
Page 5
interest earned therein) to the Trust, (ii) deliver
the Trust Deposits and the Universal Deposits to the
Trust and (iii) destroy the executed copies of the
Merger Agreement, Certificate of Merger and other
Closing Documents held by the Escrow Agent.
f. Each of the Partnership, the Trust, Power Trust V, Universal
and the Escrow Agent hereby agree that the provisions set
forth in Sections 8, 1 0 and 1 1 of the Option Agreement
shall also apply to the escrow created by this paragraph 6,
and such provisions are hereby incorporated by reference in
their entirety, except that the notice provision in Section
10.9(a) shall be deemed to apply to each of the Partnership,
the Trust and Power Trust V.
7. Upon the closing of the Merger Agreement, Parent will
release, and will cause all of the entities owned,
controlled or affiliated with Parent to release, CHI Maine
from any and all liabilities due to Parent or any of such
affiliated entities. The purpose of these releases is to
remove from the unaudited balance sheet of CHI Maine as of
June 30, 1996, in the form attached as Schedule 5.4 (ii) to
the Merger Agreement, the amount of the $14,825,487 item
shown as "due to (from) related parties" as a current
liability on such balance sheet.
8. For purposes of calculating the "Adjusted Cash Consideration
Statement" referred to section 3.3.1 of the Merger
Agreement, such calculation shall under no circumstances
include any amount due to Parent or any affiliated entity of
Parent.
9. In the event of any conflict between the provision of this
letter agreement and the provisions of the Option Agreement,
the provisions of this letter agreement shall control.
If the foregoing accurately sets forth our agreements, please sign in
the space below.
Sincerely yours,
Ridgewood Maine Hydro
Corporation, for itself and as the
Xx. Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxx, Esq.
November 15, 1996
Page 6
General Partner of Ridgewood
Maine Hydro Partners, L.P.
By: /s/ Xxxxxx X. Gold
------------------------
Name
Title
Ridgewood Electric Power
Trust IV
By: Ridgewood Power
Corporation, Managing Shareholder
By:/s/ Xxxxxx X. Gold
------------------------
Name
Title
Ridgewood Electric Power
Trust V
By: Ridgewood Power
Corporation, Managing Shareholder
By:/s/ Xxxxxx X. Gold
------------------------
Name
Title
Xx. Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxx, Esq.
November 15, 1996
Page 7
Accepted and Agreed:
Consolidated Hydro Maine, Inc.
CHI Universal, Inc.
Consolidated Hydro, Inc.
By:_____________________
Xxxxxx X. Xxxxx
President
Accepted and Agreed:
Xxxxxx Xxxxxxx Xxxxxxx Broder & Micoleau LLC
Xxx Xxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxxx, XX 00000
By:____________________________
Name:
Title:
