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EXHIBIT 1.1
USA WASTE SERVICES, INC.
COMMON STOCK
(PAR VALUE $.01 PER SHARE)
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STANDBY AGREEMENT
November 1, 1995
Xxxxxxx Xxxxxx Xxxxx Inc.
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Dear Sirs:
USA Waste Services, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to redeem on
December 11, 1995 (the "Redemption Date") all of its outstanding 8-1/2%
Convertible Subordinated Debentures due 2002 (the "Securities"), which are
convertible into shares (the "Conversion Shares") of Common Stock, par value
$.01 per share (the "Common Stock"), of the Company, at a redemption price of
105.67% of the principal amount of Securities plus accrued interest thereon
from Ocotber 15, 1995, to the Redemption Date (the "Redemption Price"). The
right to convert such Securities into Common Stock will expire at the close of
business on December 1, 1995 (the "Expiration Date").
The Company desires to make arrangements pursuant to which the Company
will have the option to sell directly to Xxxxxxx Xxxxxx Xxxxx Inc. (the
"Purchaser") such number of shares of Common Stock (the "Redemption Shares")
equal to the number of shares of Common Stock that would have been issuable
upon conversion of the Securities that are not surrendered for conversion on or
prior to the close of business on the Expiration Date.
1. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the Purchaser that:
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(a) A registration statement in respect of the Redemption Shares has
been filed with the Securities and Exchange Commission (the "Commission"); no
other document with respect to such registration statement or document
incorporated by reference therein has heretofore been filed or transmitted for
filing with the Commission; the various parts of such registration statement,
including all exhibits thereto, and including the documents incorporated by
reference in the prospectus contained in the registration statement at the time
such registration statement became or becomes effective, each as amended at the
time such registration statement became or becomes effective, being hereinafter
called the "Registration Statement"; and the prospectus on file with the
Commission at the time the Registration Statement became or becomes effective
being hereinafter called the "Prospectus;" and any reference herein to the
Prospectus shall be deemed to refer to and include the documents incorporated
by reference therein pursuant to Item 12 of Form S-3 under the Securities Act
of 1933, as amended (the "Act"); any reference to any amendment or supplement
to the Prospectus shall be deemed to refer to and include any documents filed
after the date of such Prospectus, under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and incorporated by reference in such
Prospectus; and any reference to any amendment to the Registration Statement
shall be deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date
of the Registration Statement that is incorporated by reference in the
Registration Statement;
(b) The documents incorporated by reference in the Prospectus, when
they were filed with the Commission, conformed in all material respects to the
requirements of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents at such
filing date contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so filed and
incorporated by reference in the Prospectus or any further amendment or
supplement thereto, when such documents become effective or are filed with the
Commission, as the case may be, will conform in all material respects to the
requirements of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by the Purchaser expressly for
use therein;
(c) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus did or will, at the time of effectiveness or filing with the
Commission, as the case may be, conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date as to
the Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall not
apply to any
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statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by the Purchaser expressly for
use therein;
(d) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or interference
with its businesses from fire, explosion, flood, or other calamity, whether or
not covered by insurance, or from any material labor dispute or court or
governmental action, order, or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there
has not been any material change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or affecting
the general affairs, management, financial position, stockholders' equity, or
results of operations of the Company and its subsidiaries, otherwise than as
set forth or contemplated in the Prospectus;
(e) The Company and its subsidiaries have good and marketable title in
fee simple to all real property and good and marketable title to all personal
property owned by them, in each case free and clear of all liens, encumbrances
and defects except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company and
its subsidiaries; and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
materially interfere with the use made and proposed to be made of such property
and buildings by the Company and its subsidiaries;
(f) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such qualification, or
is subject to no material liability or disability by reason of the failure to
be so qualified in any such jurisdiction; and each subsidiary of the Company
has been duly incorporated and is validly existing as a corporation and is in
good standing under the laws of its jurisdiction of incorporation;
(g) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and conform to the description of the Common Stock contained in the Prospectus;
the Conversion Shares have been duly and validly authorized and reserved for
issuance; the Conversion Shares, when issued and delivered in accordance with
the provisions of the Securities and the Indenture dated as of September 1,
1992 (the "Indenture"), between the Company and The First National Bank of
Boston, as Trustee (the "Trustee"), and the Redemption Shares, when issued and
delivered upon sale by the Company to the Purchaser as herein provided, will be
duly and validly issued, fully paid and non-assessable and will conform to the
description of the Common Stock contained in the Prospectus; the Company's
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stockholders have no preemptive rights with respect to the Common Stock; and
all of the issued shares of capital stock of each subsidiary of the Company
have been duly and validly authorized and issued, are fully paid and
non-assessable and are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims, other than liens arising
under the Revolving Credit and Term Loan Agreement dated as of June 30, 1995,
among the Company and the financial institutions named therein;
(h) At the close of business on October 30, 1995, $48,060,000
principal amount of the Securities was outstanding; the Company has duly
authorized the redemption of all outstanding Securities on the Redemption Date
at the Redemption Price and the Company has taken all action required to be
taken through the date hereof under the terms of the Securities, the Indenture
and otherwise to effect such redemption; the Securities are, and will continue
to be, convertible into the Conversion Shares at the conversion price of $13.25
per share of Common Stock by surrender of Securities to the Trustee prior to
the close of business on the Expiration Date, at which time the conversion
right will expire;
(i) The redemption of the Securities, the issuance and sale of the
Conversion Shares upon conversion of the Securities and the Redemption Shares
upon the sale by the Company to the Purchaser as herein provided, and the
compliance by the Company with all of the provisions of this Agreement and the
consummation of the transactions contemplated herein will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject; nor will such actions result in any violation of the
provisions of the Certificate of Incorporation, as amended, or the Bylaws of
the Company; nor will such actions result in a violation of any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the redemption of the Securities, the issuance of the Conversion
Shares upon conversion of the Securities or the Redemption Shares upon the sale
by the Company to the Purchaser as herein provided, or the consummation by the
Company of the transactions contemplated by this Agreement except registration
of the Redemption Shares under the Act, which will have been completed on the
date hereof, listing of the Redemption Shares on the New York Stock Exchange
("NYSE"), which will be completed prior to the Time of Delivery (as defined in
Section 2), and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Redemption Shares by the
Purchaser as herein provided;
(j) Other than as set forth or contemplated in the Prospectus, there
are no legal or governmental proceedings pending to which the Company or any of
its subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject with respect to which there is a reasonable
likelihood of a determination that would individually or in the aggregate have
a material adverse effect on the consolidated financial position, stockholders'
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equity or results of operations of the Company and its subsidiaries; and, to
the best of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(k) The Company is not subject to regulation under the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(l) Coopers & Xxxxxxx L.L.P., who have audited certain consolidated
financial statements of the Company and its subsidiaries, are independent
public accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(m) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of the
Redemption Shares) will violate or result in a violation of Section 7 of the
Exchange Act, or any regulation promulgated thereunder, including, without
limitation, Regulations G, T, U and X of the Board of Governors of the Federal
Reserve System;
(n) The Company will apply the net proceeds from the sale of
Redemption Shares for the purpose set forth in the Prospectus under the caption
"Use of Proceeds";
(o) No person has any right to request or demand to have any shares of
Common Stock or other securities of the Company registered pursuant to the
Registration Statement, which right has not been waived;
(p) The statements set forth in the Prospectus under the caption
"Description of Capital Stock", insofar as they purport to constitute a summary
of the terms of the capital stock of the Company and under the captions
"Standby Arrangements" and "Redemption of Debentures and Alternatives to
Redemption", insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate, complete and fair; and
(q) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba within
the meaning of Section 517.075, Florida Statutes.
2. Agreement to Sell and Purchase, Delivery, and Payment. (a) Subject
to the terms and conditions herein set forth, the Purchaser agrees, at the
option of the Company, exercisable by giving notice to the Purchaser not later
than 5:00 p.m., Houston time, on the Expiration Date, to purchase from the
Company at the Time of Delivery at a price per share of $14.18, such number of
Redemption Shares as shall be specified in such notice but not in excess of the
total number of Redemption Shares.
(b) Certificates in definitive form for the Redemption Shares to be
purchased by the Purchaser hereunder shall be delivered by or on behalf of the
Company against payment by Purchaser of the purchase price therefor at the
office of Xxxxxxx Xxxxxx Xxxxx Inc., 0000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx
00000.
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(c) As compensation to the Purchaser for its commitment hereunder,
the Company agrees to pay to the Purchaser, upon execution of this Agreement
the sum of $200,000.00. In addition, the Company agrees to pay to the Purchaser
no later than 2:00 pm, (Houston time) on December 5, 1995 (such time and date
being hereinafter referred to as the "Time of Delivery") at the offices of
Xxxxxxx Xxxxxx Xxxxx Inc., 0000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000, in
immediately available funds, payable by wire transfer to an account designated
by the Purchaser, an amount equal to the product of (i) $.40 and (ii) the
aggregate number of Redemption Shares purchased by the Purchaser. Such
additional compensation shall not be payable if the Purchaser determines not to
purchase the Conversion Shares on the Closing Date as a result of a failure to
be satisfied of the conditions set forth in Sections 4(e) and (f), and, to the
extent related to Section 4(e), Section 4(i).
(d) The Purchaser agrees to remit to the Company an amount equal to
(i) not less than 75% of the excess, if any, of (A) the total proceeds received
on the sale of the Redemption Shares, less any selling concessions, transfer
taxes and other direct out-of-pocket selling expenses, over (B) the purchase
price for the Redemption Shares set forth in Section 2(a) hereunder if the
number of Redemption Shares purchased by the Purchaser is equal to or less than
369,811 and (ii) not less than 50% of the excess, if any, of (A) the total
proceeds received on the sale of the Redemption Shares, less any selling
concessions, transfer taxes and other direct out-of-pocket selling expenses,
over (B) the purchase price for the Redemption Shares set forth in Section 2(a)
hereunder if the number of Redemption Shares purchased by the Purchaser is
greater than 369,811. On completion of the sale of all of the Redemption
Shares, the Purchaser will furnish the Company a statement setting forth the
total proceeds received on the sale of the Redemption Shares and the applicable
selling concessions, transfer taxes and other direct, out-of-pocket selling
expenses, including fees and disbursements of counsel. Payment of any amount
due under this paragraph will be made by the Purchaser on the second business
day following the sale by the Purchaser of all the Redemption Shares. For
purposes of the foregoing determination, any Redemption Shares not sold by or
for the account of the Purchaser before the close of business on the 20th
business day after the Time of Delivery will be deemed to have been sold on
such 20th business day for an amount equal to the last reported sale price of
the Common Stock on such day as reported by the New York Stock Exchange.
Nothing herein shall limit the right of the Purchaser, in its discretion, to
determine the price or prices at which, and the time or times when, and
Redemption Shares will be sold, whether or not prior to the Redemption Date and
whether or not for long or short account.
(e) Until the close of business on the Expiration Date, the Purchaser
may, but is not obligated to, purchase Securities in the open market in such
amount and at such prices as the Purchaser may deem advisable. All Securities
so purchased will be converted into shares of Common Stock. The shares of
Common Stock acquired by the Purchaser pursuant to the provisions of this
Section may be sold at any time or from time to time by the Purchaser. It is
also understood that, for the purpose of stabilizing the price of the Common
Stock or otherwise, the Purchaser may, but is not obligated to, purchase and
sell shares of Common Stock or other securities of the Company and over-allot
in effecting sales of Common Stock, all in such amounts and at such prices as
the Purchaser may deem advisable.
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(f) Notwithstanding anything to the contrary in this Agreement, under
no circumstances shall the aggregate underwriters' compensation payable under
this Agreement exceed the maximum amount permitted to be paid under the rules
and interpretations of the National Association of Securities Dealers, Inc.
3. Agreements of the Company. The Company agrees with the Purchaser:
(a) To make no further amendment or any supplement to the Registration
Statement or Prospectus prior to the Time of Delivery that shall be disapproved
by the Purchaser in good faith promptly after reasonable notice thereof; to
advise the Purchaser, promptly after it receives notice thereof, of the time
when the Registration Statement, or any amendment thereto, has been filed or
becomes effective or any supplement to the Prospectus or any amended Prospectus
has been filed and to furnish the Purchaser with copies thereof; to timely file
all reports and any definitive proxy or information statements required to be
filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for
so long as the delivery of a prospectus is required in connection with the
offering or sale of the Redemption Shares; to advise the Purchaser, promptly
after it receives notice thereof, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of the Prospectus, of
the suspension of the qualification of the Redemption Shares for offering or
sale in any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any
order preventing or suspending the use of the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its withdrawal.
(b) Promptly from time to time to take such action as the Purchaser
may reasonably request to qualify the Redemption Shares for offering and sale
under the securities laws of such jurisdictions as the Purchaser may request
and to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Redemption Shares, provided that in connection
therewith the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction.
(c) To furnish the Purchaser with copies of the Prospectus in such
quantities as the Purchaser may from time to time reasonably request, and, if
the delivery of a prospectus is required at any time prior to the expiration of
nine months after the time of issue of the Prospectus in connection with the
offering or sale of the Redemption Shares and if at such time any event shall
have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such Prospectus
is delivered, not misleading, or, if for any other reason it shall be necessary
during such period to amend or supplement the Prospectus or to file under the
Exchange Act any document incorporated by reference in the Prospectus in order
to comply with the Act or the Exchange Act, to notify the Purchaser and upon
the Purchaser's
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request to file such document and to prepare and furnish without charge to the
Purchaser and to any dealer in securities as many copies as the Purchaser may
from time to time reasonably request of an amended Prospectus or a supplement
to the Prospectus which will correct such statement or omission or effect such
compliance, and in case the Purchaser is required to deliver a prospectus in
connection with sales of any of the Redemption Shares at any time nine months
or more after the time of issue of the Prospectus, upon request of the
Purchaser but at the expense of the Purchaser, to prepare and deliver to the
Purchaser as many copies as the Purchaser may request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the Act.
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than 18 months after the effective date
of the Registration Statement (as defined in Rule 158(c)), an earnings
statement of the Company and its subsidiaries (which need not be audited)
complying with Section 11(a) of the Act and the rules and regulations
thereunder (including at the option of the Company Rule 158).
(e) During the period beginning from the date hereof and continuing to
and including the Time of Delivery and, if the Purchaser purchases any
Redemption Shares hereunder, further continuing to and including the date 90
days after the Redemption Date, not to offer, sell, contract to sell or
otherwise dispose of, any shares of Common Stock of the Company, any securities
of the Company substantially similar to the Common Stock or any securities
convertible into or exchangeable for Common Stock or any substantially similar
security (except for any securities, issued, offered, sold or disposed of by
the Company to its stock option and other benefit plans maintained for its
officers, directors and employees, Common Stock issued or distributed in
connection with the conversion of any security of the Company outstanding on
the date of the Prospectus, or Common Stock issued in connection with the
acquisition of businesses or properties by the Company) without the Purchaser
prior written consent.
(f) To use its best efforts to list, subject to notice of issuance,
the Redemption Shares on the NYSE.
(g) To cause to be given notice of redemption on the date hereof (the
"Effective Date"), such notice to be in the form submitted to and approved by
the Purchaser and to be in accordance with the requirements of Article Twelve
of the Indenture, and to contain the information called for thereby, and to
furnish such copies of such notice to the Purchaser as the Purchaser may
request; and, in addition, to cause to be given notice of redemption by press
release at such times as the Purchaser and the Company may mutually agree.
(h) To advise the Purchaser or to cause the Purchaser to be advised on
each business day prior to the Time of Delivery of the principal amount of the
Securities surrendered on the preceding business day for conversion into shares
of Common Stock or for redemption.
(i) To supplement the Prospectus, or file a post-effective amendment
to the Registration Statement, after the Redemption Date to set forth the
results of the call for redemption and other information that may be required
to comply with the rules of the Commission, if applicable, and,
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if the Purchaser purchases any Redemption Shares hereunder, not later than 15
days after the Redemption Date, to file a post-effective amendment to the
Registration Statement or to take such other steps as may be necessary to
remove from registration all shares of Common Stock which have not been issued
to the Purchaser pursuant to Section 2 hereof.
(j) To pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Redemption Shares under the Act, the
redemption of the Securities, the issuance of the Conversion Shares upon
conversion of the Securities or the Redemption Shares upon the sale by the
Company to the Purchaser as herein provided, and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Purchaser and dealers; (ii) the
cost of printing, producing this Agreement, the Blue Sky survey, or publishing
the notice of redemption of the Securities and related letters of transmittal,
notice of guaranteed delivery and any other documents (including newspaper
notices or advertisements) in connection with the redemption or conversion of
the Securities and the offering, purchase, sale, and delivery of the Redemption
Shares; (iii) all expenses in connection with the qualification of the
Redemption Shares for offering and sale under state securities laws as provided
in Section 3(b) hereof, including the fees and disbursements of counsel for the
Purchaser in connection with such qualification and in connection with the Blue
Sky surveys; (iv) the filing fees incident to securing any required review by
the National Association of Securities Dealers, Inc. of the terms of the
issuance or sale of the Redemption Shares; (v) the cost of preparing stock
certificates; (vi) the cost and charges of any transfer agent or registrar for
the Securities and the Common Stock and any fees and expenses incurred under
the Indenture; (vii) the fees and expenses of the Trustee and any agent of the
Trustee, and the fees and disbursements of counsel for the Trustee in
connection with the redemption of the Securities; (viii) the fees incurred in
connection with listing the Redemption Shares on the NYSE; (ix) if the
Purchaser does not purchase any Redemption Shares hereunder the reasonable fees
and disbursements of counsel to the Purchaser; and (x) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section. Except as otherwise
provided by this Section, Section 5 and Section 6(c), Purchaser shall pay all
of its own costs and expenses, including any advertising expenses connected
with any offer it may make.
4. Conditions of the Obligations of the Purchaser. The obligations of
the Purchaser hereunder, shall be subject, in its discretion, to the condition
that all representations and warranties and other statements of the Company
herein are, at and as of the Effective Date and are, at and as of the Time of
Delivery (other than Section 1(d)) true and correct, the condition that the
Company shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions (other than, in the case of
the Time of Delivery, paragraphs (e), (f), and, to the extent related to
paragraph (e), paragraph (i)):
(a) The Registration Statement shall have become effective,
and the Purchaser shall have received prompt notice thereof; no stop
order suspending the effectiveness of the Registration Statement shall
have been issued and no proceeding for that purpose shall have been
initiated or threatened by the Commission; and all requests for
additional
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information on the part of the Commission shall have been compiled
with to the Purchaser's reasonable satisfaction;
(b) Xxxxx & Xxxxx, X.X., counsel for the Company, shall have
furnished to the Purchaser their written opinion, dated the Time of
Delivery, in form and substance satisfactory to the Purchaser, to the
effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware, with corporate power and
authority to own its properties and conduct its business as
described in the Prospectus;
(ii) The Company has an authorized capitalization as
set forth in the Prospectus, and all of the issued shares of
capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable;
the Conversion Shares and the Redemption Shares have been duly
and validly authorized for issuance; the Conversion Shares,
when issued and delivered in accordance with the Securities
and the Indenture, and the Redemption Shares, when issued and
delivered upon the sale by the Company to the Purchaser as
herein provided, will be duly and validly issued and fully
paid and non- assessable and will conform to the description
of the Common Stock contained in the Prospectus;
(iii) The Company has been duly qualified as a
foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in
which it owns or leases properties, or conducts any business,
so as to require such qualification, or is subject to no
material liability or disability by reason of failure to be so
qualified in any such jurisdiction (such counsel being
entitled to rely in respect of the opinion in this clause in
respect of matters of fact upon certificates of public
officials and officers of the Company, provided that such
counsel shall state that he believes that both the Purchaser
and they are justified in relying upon such certificates);
(iv) Each subsidiary of the Company identified on
Annex I attached hereto (the "Material Subsidiaries") has been
duly incorporated and is validly existing as a corporation in
good standing under the laws of its jurisdiction of
incorporation; and all of the issued shares of capital stock
of each such subsidiary have been duly and validly authorized
and issued, are fully paid and non-assessable, and (except for
directors' qualifying shares) are owned directly or indirectly
by the Company, free and clear of all liens, encumbrances,
equities or claims, other than liens arising under the
Revolving Credit and Term Loan Agreement dated as of June 30,
1995 (such counsel being entitled to rely in respect of the
opinion in this clause in respect of matters of fact upon
certificates of public officials and officers of the Company
or its subsidiaries, provided that
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such counsel shall state that he believes that both the
Purchaser and he are justified in relying upon certificates);
(v) To the best of such counsel's knowledge and other
than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the
Company or any of its subsidiaries is the subject with respect
to which there is a reasonable likelihood of determinations
which would individually or in the aggregate have a material
adverse effect on the consolidated financial position,
stockholders' equity or results of operations of the Company
and its subsidiaries; and, to the best of such counsel's
knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others;
(vi) This Agreement has been duly authorized,
executed and delivered by the Company;
(vii) The Securities are convertible in accordance
with their terms and pursuant to the Indenture in the manner
and upon the terms described in the Prospectus;
(viii) The redemption by the Company on the
Redemption Date of all the outstanding Securities in the
manner and upon the terms described in the Prospectus has been
duly authorized by all required corporate action and is in
compliance with the terms of the Indenture and the Securities;
(ix) The redemption of the Securities, the issuance
and sale of the Conversion Shares upon conversion of the
Securities or the Redemption Shares upon the sale by the
Company to the Purchaser as herein provided, the compliance by
the Company with all of the provisions of this Agreement and
the consummation of the transactions herein contemplated, to
the best of such counsel's knowledge, will not conflict with
or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject; nor will such actions
result in any violation of the provisions of the Certificate
of Incorporation, as amended, or the Bylaws of the Company or
any statute of the United States of America or of Delaware or
any other statute known to such counsel or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or
any of their properties;
(x) To the best of such counsel's knowledge, no
consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency
or body is required by or on behalf of the Company for the
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redemption of the Securities, the issuance of the Conversion
Shares upon conversion of the Securities or the Redemption
Shares upon the sale by the Company to the Purchaser as herein
provided or the consummation by the Company of the other
transactions contemplated by this Agreement, except such as
have been obtained under the Act, the listing of the
Redemption Shares on the NYSE, which will occur prior to the
Time of Delivery, and such consents, approvals,
authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection
with the purchase and distribution of the Redemption Shares by
the Purchaser;
(xi) The documents incorporated by reference in the
Prospectus or any further amendment or supplement thereto made
by the Company prior to the Time of Delivery (other than (a)
the financial statements, notes and schedules thereto included
or incorporated by reference therein and (b) other financial
and statistical information included or incorporated by
reference therein, as to all of which such counsel need
express no opinion), when they became effective or were filed
with the Commission, as the case may be, complied as to form
in all material respects with the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations
of the Commission thereunder; and such counsel has no reason
to believe that any of such documents, when such documents
became effective or were so filed, as the case may be,
contained, in the case of a registration statement which
became effective under the Act, an untrue statement of a
material fact, or omitted to state a material fact required to
be stated therein or necessary to make the statements therein
not misleading, or, in the case of other documents which were
filed under the Act or the Exchange Act with the Commission,
an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made when such documents were so filed, not misleading;
(xii) The Registration Statement and the Prospectus
and any further amendments and supplements thereto made by the
Company prior to the Time of Delivery (other than (a) the
financial statements, notes and schedules thereto included or
incorporated by reference therein and (b) other financial and
statistical information included or incorporated by reference
therein, as to all of which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Act and the rules and regulations
thereunder; such counsel has no reason to believe that, as of
its effective date, the Registration Statement or any further
amendment thereto made by the Company prior to the Time of
Delivery (other than (a) the financial statements, notes and
schedules thereto included or incorporated by reference
therein and (b) other financial and statistical information
included or incorporated by reference therein, as to all of
which such counsel need express no opinion) contained an
untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading or that, as of its
date, the Xxxxxxxxxx
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or any further amendment or supplement thereto made by the Company
prior to the Time of Delivery (other than (a) the financial
statements, notes and schedules thereto included or incorporated by
reference therein and (b) other financial or statistical information
included or incorporated by reference therein, as to all of which such
counsel need express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact necessary to make
the statements therein, in light of the circumstances in which they
were made, not misleading or that, as of the Time of Delivery, either
the Registration Statement or the Prospectus or any further amendment
or supplement thereto made by the Company prior to the Time of
Delivery (other than (a) the financial statements, notes and schedules
thereto included or incorporated by reference therein and (b) other
financial or statistical information included or incorporated by
reference therein, as to all of which such counsel need express no
opinion) contains an untrue statement of a material fact or omits to
state a material fact necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading;
and such counsel does not know of any amendment to the Registration
Statement required to be filed or of any contracts or other documents
of a character required to be filed as an exhibit to the Registration
Statement or required to be incorporated by reference into the
Prospectus or required to be described in the Registration Statement
or the Prospectus which are not filed or incorporated by reference or
described as required;
(d) At the Time of Delivery, the Purchaser shall have received a
letter or letters, in form and substance satisfactory to the Purchaser, from
Coopers & Xxxxxxx L.L.P. with respect to the financial statements and certain
financial information contained in the Registration Statement and the
Prospectus and from Deloitte & Touche L.L.P. and Xxxxxx Xxxxxxxx L.L.P. each
with respect to the financial statements and certain financial information
contained in the Registration Statement and the Prospectus;
(e) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Prospectus, and
(ii) since the respective dates as of which information is given in the
Prospectus there shall not have been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in any such case described
in clause (i) or (ii), is in the Purchaser's reasonable judgment so material
and adverse as to make it impracticable or inadvisable to proceed with the
transactions contemplated by this Agreement on the terms and in the manner
contemplated in the Prospectus;
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(f) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in securities
generally on the NYSE; (ii) a general moratorium on commercial banking
activities in Texas declared by either Federal or Texas State authorities; or
(iii) the outbreak or escalation of hostilities involving the United States or
the declaration by the United States of a national emergency or war, if the
effect of any such event specified in this clause (iii) in the Purchaser's
reasonable judgment makes it impracticable or inadvisable to proceed with the
transactions contemplated by this Agreement on the terms and in the manner
contemplated by the Prospectus;
(h) The Conversion Shares are listed, and the Redemption Shares to be
sold by the Company at the Time of Delivery shall have been duly listed,
subject to notice of issuance, on the NYSE; and
(i) The Company shall have furnished or caused to be furnished to the
Purchaser on the Effective Date and at Time of Delivery certificates of
officers of the Company satisfactory to the Purchaser as to the accuracy of the
representations and warranties of the Company herein at and as of the Effective
Date or the Time of Delivery (other than, in the case of the Time of Delivery,
Section 1(d)), respectively, as to the performance by the Company of all of its
obligations hereunder to be performed at or prior to the Effective Date or the
Time of Delivery, as the case may be, as to the matters set forth in
subsections (a) and (e) of this Section and as to such other matters as the
Purchaser may reasonably request.
5. Indemnification. (a) The Company will indemnify and hold harmless
the Purchaser against any losses, claims, damages or liabilities, to which the
Purchaser may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse the Purchaser for any legal or other expenses reasonably incurred by
the Purchaser in connection with investigating or defending any such action or
claim as such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration
Statement or the Prospectus or any such amendment or supplement in reliance
upon and in conformity with written information furnished to the Company by the
Purchaser expressly for use therein.
(b) The Purchaser will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not
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misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission
was made in the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by the Purchaser expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by
the Company in connection with investigating or defending any such action or
claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, to
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and, after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under such subsection for any legal expenses of other counsel or any
other expenses, in each case subsequently incurred by such indemnified party,
in connection with the defense thereof other than reasonable costs of
investigation;
(d) If the indemnification provided for in this Section 5 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the Purchaser
on the other from the transactions contemplated by this Agreement. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company on the one hand and the Purchaser on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Purchaser on the other with respect to
the transactions contemplated by this Agreement shall be deemed to be in the
same proportion as the market value of the Common Stock issuable upon
conversion of the Securities on the last Trading Day (as defined in Section
6(b)) immediately preceding the date of this Agreement (calculated based on the
Closing Price of the Common Stock) bears to the compensation received by the
Purchaser pursuant to Section 2. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement
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of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or the Purchaser
on the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company
and the Purchaser agree that it would not be just and equitable if
contributions pursuant to this subsection (d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), the Purchaser shall not be required to
contribute any amount in excess of the amount by which the total price at which
the Redemption Shares purchased by it and distributed to the public were
offered to the public exceeds the amount of any damages which the Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The obligations of the Company under this Section 5 shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls the Purchaser within the meaning of the Act; and the obligations of
the Purchaser under this Section 5 shall be in addition to any liability which
the Purchaser may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company and to each person, if
any, who controls the Company within the meaning of the Act.
6. Miscellaneous. (a) The respective indemnities, agreements,
representations, warranties and other statements of the Company and the
Purchaser as set forth in this Agreement or made by them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless
of any investigation (or any statement as to the results thereof) made by or on
behalf of the Purchaser or any controlling person of the Purchaser or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of the Conversion Shares and the Redemption Shares and
payment for the Redemption Shares.
(b) For purposes of this Agreement, "Trading Day" means a day on
which the Common Stock is traded on the NYSE, and "Closing Price" means the
reported last sale price regular way per share of the Common Stock, or in case
no such reported sale takes place on such day, the average of the reported
closing bid and asked prices regular way, in either case on the NYSE.
(c) If for any reason after the notice pursuant to Section 2(a) has
been delivered, No Redemption Shares included in such notice are delivered by
or on behalf of the Company as provided herein, the Company will reimburse the
Purchaser for all out-of-pocket expenses, including fees and disbursements of
counsel, reasonably incurred by the Purchaser in making preparations for the
purchase, sale and delivery of the Redemption Shares not so delivered, but
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the Company shall then be under no further liability to the Purchasers in
respect of the Redemption Shares not so delivered except as provided in Section
2 and Section 5 hereof.
(d) All statements, requests, notices and agreements hereunder shall
be in writing, and if to the Purchaser shall be delivered or sent by mail,
telex or facsimile transmission to Xxxxxxx Xxxxxx Xxxxx Inc., 0000 Xxxxx
Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000, Attention: Xxx X. Xxxxxx, facsimile
number 000-000-0000; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: General Counsel, facsimile number
000-000-0000. Any such statements, requests, notices or agreements shall take
effect at the time of receipt thereof.
(e) This Agreement shall be binding upon, and inure solely to the
benefit of, the Purchaser, the Company and, to the extent provided in Section 5
and Section 6(a) hereof, the officers and directors of the Company and each
person who controls the Company or the Purchaser, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser
of any of the Redemption Shares from the Purchaser shall be deemed a successor
or assign by reason merely of such purchase.
(f) Time shall be of the essence of this Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
(g) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF TEXAS.
(h) This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us five counterparts hereof, and upon the acceptance hereof by
the Purchaser this letter and such acceptance hereof shall constitute a binding
agreement between the Purchaser and the Company.
Very truly yours,
USA WASTE SERVICES, INC.
By:___________________________
Name:
Title:
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Accepted as of the date hereof:
XXXXXXX XXXXXX XXXXX INC.
By______________________________
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ANNEX I
Material Subsidiaries
