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EXHIBIT 10.14
AGREEMENT
This Agreement is entered into as of September 30, 1998, among 3CI
Complete Compliance Corporation, a Delaware corporation (the "Company"), Waste
Systems, Inc., a Delaware corporation ("WSI") and Stericycle, Inc., a Delaware
corporation ("Stericycle").
WHEREAS, WSI owns a majority of the issued and outstanding common
stock, par value $.01 per share (the "Common Stock"), of the Company; and
WHEREAS, the stockholders of WSI have entered into a Stock Purchase
Agreement with Stericycle dated as of September 3, 1998 (the "Stock Purchase
Agreement"), pursuant to which, among other things, the stockholders of WSI have
agreed to sell 100% of the issued and outstanding common stock, without par
value, of WSI to Stericycle (the "WSI Acquisition"); and
WHEREAS, Section 203 of the Delaware General Corporation Law (the
"DGCL") provides, among other things, that a corporation shall not engage in any
"business combination" with any "interested stockholder" for a period of three
years following the time that such stockholder became an interested stockholder
unless before such time the board of directors of the corporation approved
either the business combination or the transaction which resulted in the
stockholder becoming an interested stockholder; and
WHEREAS, upon consummation of the WSI Acquisition, Stericycle will
become an "interested stockholder" in the Company for purposes of Section 203 of
the DGCL; and
WHEREAS, WSI desires that the Company's board of directors approve the
WSI Acquisition before consummation thereof so that Section 203 of the DGCL will
not apply to Stericycle following consummation of the WSI Acquisition; and
WHEREAS, the Company's board of directors, in order to protect the
interests of the Company's minority stockholders, has conducted extensive
discussions with Stericycle's management concerning Stericycle's intended
operation of the Company after consummation of the WSI Acquisition and the
effect the WSI Acquisition may have on the Company and its minority
stockholders; and
WHEREAS, the Company appointed a special committee of independent
directors (the "Special Committee") to evaluate the WSI Acquisition and to make
a recommendation to the Company's full board of directors concerning whether
such board of directors should approve the WSI Acquisition for purposes of
Section 203 of the DGCL; and
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WHEREAS, the Special Committee has recommended to the Company's full
board of directors to approve the WSI Acquisition under the terms and conditions
set forth herein:
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Amendment to Revolving Promissory Note. Before consummation of the
WSI Acquisition, the Revolving Promissory Note of the Company dated September
30, 1995 (the "Original Note") in the original maximum principal amount of
$8,000,000 will be amended and restated in its entirety in the form of Exhibit A
hereto (the "Amended Note"). The initial principal amount of the Amended Note
shall be equal to the outstanding principal amount of the Original Note as of
the date hereof plus the receivable in the current amount of $483,405.71 owed by
the Company to WSI (the "Receivable"). The Receivable shall be canceled in full
upon the execution and delivery of the Amended Note.
2. Shepherd Put. Stericycle and WSI acknowledge that pursuant to
Section 3(c) of the Settlement Agreement and Release of all Claims dated January
10, 1996 (the "Shepherd Settlement Agreement"), between Xxxxx X. Xxxxxxxx, Xxxxx
Xxxxxxx Xxxxxxxx and Xxxxxxx X. XxXxxxxxxx as Releasors, and the Company, WSI,
Xxxxx Xxxxxxxx, Xxxxxxx Xxxxxxx, Xxxxxx Xxxxxx and Xxxxxxx Crochet as Releasees,
WSI and the Company granted to the Releasors, separately and jointly, certain
put options (the "Shepherd Put") pursuant to which the Releasors can cause WSI
and the Company to repurchase certain shares of the Company's Common Stock
issued to the Releasors under the Shepherd Settlement Agreement. Stericycle
hereby agrees that if for any reason at any time after the date hereof the
Shepherd Put is validly exercised under the terms and the conditions of the
Shepherd Settlement Agreement, Stericycle shall cause WSI to, assume financial
responsibility for satisfying the repurchase of the Company's Common Stock
subject to the Shepherd Put, either directly or by advancing such sums to 3CI as
may in WSI's discretion be appropriate to enable 3CI to satisfy the repurchase.
3. Business Combination. If at any time after the date hereof the board
of directors of WSI or Stericycle should propose a "business combination" as
defined in Section 203 of the DGCL involving the Company and Stericycle or any
affiliate of Stericycle, Stericycle shall, in determining the consideration to
be paid in such business combination, obtain a written report from an
independent investment banking or valuation consulting firm as to either (i) the
fairness, from a financial point of view, of such business combination to the
Company's shareholders or (ii) an appraisal of the fair market value of the
Company.
4. Approval of the WSI Acquisition. The obligations of Stericycle and
WSI under Sections 1 through 3 of this Agreement are conditioned upon, and in
consideration of, the receipt by Stericycle of evidence reasonably satisfactory
to Stericycle that the Company's board of directors has taken all necessary and
proper action to approve the WSI Acquisition for purposes of Section 203 of the
DGCL.
5. Validity of Section 203 Approval. Neither Stericycle, WSI, 3CI or
any officer or director of Stericycle, WSI or 3CI shall initiate any proceeding
in any court to challenge the validity of the approval of the WSI Acquisition by
the Company's board of directors for purposes Section 203 of the DGCL.
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IN WITNESS WHEREOF, the undersigned have set forth their hands this
30th day of September, 1998.
3CI COMPLETE COMPLIANCE CORPORATION
By: /s/ Xxxxxxx X. Crochet
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President
WASTE SYSTEMS, INC.
By: /s/ Clemens Pues
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President
STERICYCLE, INC.
By: /s/ Xxxxx xxxXxxxx
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Chief Financial Officer
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