ASSUMPTION AND GUARANTEE AGREEMENT
This Assumption and Guarantee Agreement (the "Agreement"), dated as of
August 12, 1996, is entered into by and among Newpark Resources, Inc., a
Delaware corporation ("Newpark"), Sanifill, Inc., a Delaware corporation
("Sanifill"), and Xxxxxxxx Xxxxx, Ltd., a Delaware limited partnership, the
equity interests of which are owned directly or indirectly by Sanifill
("Xxxxxxxx Xxxxx" and, collectively with Sanifill, the "Sellers").
WHEREAS, Newpark and Xxxxxxxx Xxxxx are each engaged in the collection
and disposal of nonhazardous oilfield waste; and
WHEREAS, the Sellers, NOW Disposal Holding Co. ("Holdco") and Newpark
have entered into that certain Asset Purchase and Lease Agreement (the "Purchase
Agreement") pursuant to which Newpark is, simultaneously with the execution of
this Agreement, (i) purchasing all of the equity interests (the "Equity
Interests") in NOW Disposal Operating Co., a Delaware corporation and a wholly-
owned subsidiary of Holdco ("Disposeco"), and (ii) purchasing or leasing from
Xxxxxxxx Xxxxx the "Included Assets" (as defined in the Purchase Agreement) used
in the "Acquired Business" (as defined in the Purchase Agreement); and
WHEREAS, simultaneously with the execution of this Agreement, the
Sellers and Newpark are also entering into that certain Noncompetition Agreement
pursuant to which, with exceptions stated therein, the Sellers are agreeing not
to engage in the collection or disposal of nonhazardous oilfield waste generated
in the States of Louisiana, Texas, Mississippi and Alabama and in the Gulf of
Mexico; and
WHEREAS, after giving effect to the transactions described above,
Xxxxxxxx Xxxxx will continue to operate and own certain landfarms and a landfill
at which nonhazardous oilfield wastes are disposed of; and
WHEREAS, the Sellers and Disposeco have previously entered into that
certain NOW Disposal Agreement (the "Disposal Agreement") pursuant to which
Disposeco has agreed to deliver and Xxxxxxxx Xxxxx has agreed to accept certain
quantities of nonhazardous oilfield wastes at its landfarms in Louisiana each
year for a period of 25 years; and
WHEREAS, in connection with the transactions referenced above,
including without limitation the transfer of the Equity Interests pursuant to
the Purchase Agreement, Newpark has agreed to guarantee the obligations of
Disposeco under the Disposal Agreement and to take, or refrain from taking,
certain other actions in connection with the Disposal Agreement; and
WHEREAS, the parties desire to enter into this Agreement to more fully
set forth the terms and conditions of their understanding.
NOW, THEREFORE, in consideration of the above premises and the mutual
covenants and promises contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Unless otherwise specifically defined herein, all capitalized terms
used herein shall have the respective meanings ascribed to such terms in the
Disposal Agreement.
ARTICLE II
PERFORMANCE OF DISPOSAL AGREEMENT
Newpark hereby covenants and agrees that it shall cause Disposeco to
fully perform all of its obligations under the Disposal Agreement in a timely
manner. Newpark further covenants and agrees that it shall take all action,
including without limitation supplying information necessary for the
determination of quantities of NOW to be delivered pursuant to the Disposal
Agreement, or shall refrain from taking any action, as is necessary or
appropriate to permit Disposeco to fully perform all of its obligations under
the Disposal Agreement in a timely manner.
ARTICLE III
GUARANTEE OF DISPOSAL AGREEMENT
3.1 UNCONDITIONAL GUARANTEE. Newpark hereby unconditionally and
irrevocably guarantees the performance in full of all obligations of Disposeco
under the Disposal Agreement (such obligations of Disposeco being collectively
referred to herein as the "Guaranteed Obligation"), with the same force and
effect and to the same extent as if Newpark were a party to the Disposal
Agreement having the same rights and obligations thereunder as Disposeco.
3.2 NO SET-OFF; GUARANTY OF PERFORMANCE OR PAYMENT UPON DEMAND. Newpark
shall perform any obligations or pay any amounts due in respect of the
Guaranteed Obligation promptly upon demand by the Sellers, without any set-off,
defense or deduction for any claims or counterclaims of any kind, except for any
such set-offs, defenses, deductions that Newpark could assert if it were a party
to the Disposal Agreement having the same rights and obligations thereunder as
Disposeco.
3.3 WAIVER OF DILIGENCE, ETC. Newpark hereby waives diligence,
presentment, demand, protest and notice of any kind with respect to this
Agreement, as well as any requirement that Sellers exhaust any rights or take
any action against Disposeco.
3.4 WAIVER OF SURETYSHIP DEFENSES. To the extent permitted by applicable
law, Newpark hereby waives any and all legal and equitable defenses that arise
by reason of Newpark's status as a surety for Disposeco, which defenses would
not be available to Newpark if it were a party to the Disposal Agreement having
the same rights and obligations thereunder as Disposeco.
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ARTICLE IV
COVENANTS, REPRESENTATIONS AND WARRANTIES OF NEWPARK
Newpark hereby covenants, represents and warrants to Sellers as of the
date of this Agreement that:
4.1 ORGANIZATION AND QUALIFICATION. Newpark (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (b) has all requisite power and authority to own, lease and
operate its properties and to carry on its business as it is now being conducted
and is proposed to be conducted and (c) is duly qualified or licensed and in
good standing to do business in each jurisdiction in which the properties owned,
leased or operated by it or the nature of the business conducted or proposed to
be conducted by it makes such qualification or license necessary, except in such
jurisdictions where the failure to be so duly qualified or licensed or in good
standing would not have, either individually or in the aggregate, a material
adverse effect on the transactions contemplated hereby.
4.2 AUTHORIZATION AND VALIDITY OF AGREEMENT. Newpark has all requisite
power and authority to enter into this Agreement and to perform its obligations
hereunder and consummate the transactions contemplated hereby. The execution,
delivery and performance by Newpark of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by all necessary
action on the part of Newpark. No action or approval of the equity owners of
Newpark is necessary to authorize Newpark's execution or delivery of, or the
performance of its obligations under, this Agreement. This Agreement has been
duly executed and delivered by Newpark and is a valid and binding obligation of
Newpark, enforceable in accordance with its terms.
4.3 NO CONFLICT. The execution and delivery by Newpark of this Agreement
do not, and exercise by Newpark of its rights hereunder and the consummation of
the transactions contemplated hereby will not (a) require any consent, approval,
order or authorization of or other action by any governmental entity on the part
of or with respect to Newpark; (b) require on the part of Newpark any consent by
or approval of or notice to any other Person; or (c) result in a violation of
any law, rule, regulation, order, judgment or decree applicable to Newpark,
except in any case covered by (a), (b) or (c) where failure to obtain such
consent or such violation would not, either individually or in the aggregate,
have a material adverse effect on the transactions contemplated hereby.
4.4 TRANSFER OF AFFILIATES OF NEWPARK. The parties recognize and agree
that due to the method of calculating Annual Volume as set forth in Section
[2.2] of the Disposal Agreement, the purpose and intent of the Disposal
Agreement and of this Agreement would be frustrated in the event Newpark sold or
otherwise transferred (an "Affiliate Transfer") its interest in, or
substantially all of the assets of, any of its Affiliates which are engaged in
processing or disposal of NOW in the Covered Region where such transfer resulted
in such Persons no longer being, or such assets no longer being owned by,
Affiliates of Newpark under the terms of the Disposal Agreement. Newpark agrees
that it shall notify Xxxxxxxx Xxxxx of any such proposed Affiliate Transfer
prior to the consummation of such transaction and that no such Affiliate
Transfer shall take place unless the transferee agrees (a) to report to Xxxxxxxx
Xxxxx all quantities of NOW received by such former Affiliate of Newpark in
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the Covered Region during the remaining term of the Disposal Agreement and (b)
that any subsequent retransfer of such interests or assets by such transferee
shall be subject to this Article IV as if such transferee were Newpark. Newpark
further agrees that it shall not enter into any Affiliate Transfer unless the
agreement with the transferee expressly names Xxxxxxxx Xxxxx as a third party
beneficiary of the obligation of the transferee to make such reports and to
subject subsequent retransfers to this Article IV.
ARTICLE V
DISPUTE RESOLUTION
All disputes arising under this Agreement shall be resolved in
accordance with the arbitration procedures set forth in Article X of the
Disposal Agreement. In the event a set of facts gives rise to related disputes
under this Agreement and the Disposal Agreement, such disputes shall be
consolidated into a single arbitration proceeding, the result of which shall be
binding on all parties under both Agreements, unless the arbitrator or
arbitrators determine that it would manifestly unfair to honor this provision
and determine that separate arbitration procedures are required.
ARTICLE VI
MISCELLANEOUS
6.1 STATUS OF THE PARTIES. Each party hereto is and shall perform this
Agreement as an independent contractor, and as such, shall have and maintain
complete control over all of its employees, agents, and operations. Except as
expressly otherwise provided in this Agreement, neither party nor anyone
employed by it shall be, represent, act, purport to act or be deemed to be the
agent, representative, employee or servant of the other party.
6.2 NO SET-OFF RIGHTS. The parties hereby agree that neither party shall
have any right to set-off or apply against any sums due under this Agreement any
sums due or amounts otherwise owing pursuant to any other provision of this
Agreement or any other agreement or arrangement between the parties.
6.3 BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns. Xxxxxxxx Xxxxx and Newpark may assign their rights, obligations and
duties under this Agreement with the written consent of the other parties to the
Agreement, which consent shall not be unreasonably withheld; provided that the
assigning party shall remain primarily liable for all obligations and duties
arising hereunder.
6.4 NOTICES. Notices and other communications provided for herein shall
be in writing and shall be deemed to have been validly given (a) 3 days after
deposit in the United States mails, registered or certified mail with proper
postage prepaid and return receipt requested, (b) upon transmission thereof and
receipt of the appropriate confirmation if sent via telecopier or telefax, (c)
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the business day after the same shall have been deposited with a reputable
overnight courier, shipping prepaid and (d) if delivered in person, upon
delivery, in each case addressed as follows:
If to Newpark, to: with a copy to:
Xxxxx X. Xxxx Xxxxxxx X. Xxxxxxx
President Xxxxx, Xxxxx & Xxxxxx
Newpark Resources, Inc. 0000 Xxxxxxxx Xxxxxxxxx
3850 N. Causeway, Ste. 0000 Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxx 00000 Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000
ph: 000-000-0000 ph: 000-000-0000
fax: 000-000-0000 fax: 000-000-0000
If to Xxxxxxxx Xxxxx, to: with a copy to:
W. Xxxxxxx Xxx Xxxxxx X. Xxxxxxx
President Xxxxx & Xxxxx. L.L.P.
Xxxxxxxx Xxxxx, Ltd. One Shell Plaza
2014 West Pinhook Road, Ste. 900 910 Louisiana
Xxxxxxxxx, Xxxxxxxxx 00000 Xxxxxxx, Xxxxx 00000-0000
ph: 000-000-0000 ph: 000-000-0000
fax: 000-000-0000 fax: 000-000-0000
If to Sanifill, to: with a copy to:
H. Xxxxxx Xxxxxx Xxxxxx X. Xxxxxxx
Secretary Xxxxx & Xxxxx. L.L.P.
Sanifill, Inc. Xxx Xxxxx Xxxxx
0000 Xxxxx Xxxxxxx, Ste. 700 910 Louisiana
Houston, Texas 77019-2155 Xxxxxxx, Xxxxx 00000-0000
ph: 000-000-0000 ph: 000-000-0000
fax: 000-000-0000 fax: 000-000-0000
or such other address as any party shall specify by written notice so given.
6.5 NON-WAIVER. The failure of any party to enforce its rights under any
provision of this Agreement shall not be construed to be a waiver of such
provision. No waiver of any breach of this Agreement shall be held to be a
waiver of any other breach.
6.6 ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the entire
agreement between the parties concerning the subject matter hereof and
supersedes any and all other communications, representations, proposals,
understandings or agreements, either written or oral, between the parties hereto
with respect to such subject matter. This Agreement may not be modified or
amended, in whole or in part, except by a writing signed by both parties hereto.
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6.7 SEVERABILITY. If any provision of this Agreement is declared invalid
or unenforceable, then such portion shall be deemed to be severable from this
Agreement and shall not affect the remainder hereof.
6.8 HEADINGS. The Article and Section headings contained herein are for
reference purposes only and shall not in any way affect the meaning and
interpretation of this Agreement.
6.9 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
constitute one instrument.
6.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
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EXECUTED as of the day and year first above written.
NEWPARK RESOURCES, INC.
By:_______________________________________
Name:
Title:
SANIFILL, INC.
By:_______________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Treasurer and Assistant Secretary
XXXXXXXX XXXXX, LTD.
By: SANIFILL GP HOLDING CO., INC.,
its general partner
By:_______________________________
Name: Xxxxxxx X. Xxxxxx
Title: Treasurer and Assistant
Secretary
