EXHIBIT 10.59
ESTOPPEL AND WAIVER AGREEMENT
This Estoppel and Waiver Agreement (the Agreement") is made and entered
into effective as of the 10th day of April, 1998 by and between Sanifill, Inc.,
a Delaware Corporation ("Sanifill"), and U S Liquids Inc., a Delaware
Corporation ("Liquids).
RECITALS
WHEREAS, pursuant to the terms of that certain Asset Purchase Agreement
(the "Asset Purchase Agreement"), dated as of December 2, 1996, among Liquids,
Sanifill, Xxxxxxxx Xxxxx, X.X., and Xxxxxxxx Xxxxx XXXX, L.P., Liquids acquired
substantially all of the assets of and assumed certain liabilities relating to
Xxxxxxxx Xxxxx X.X., and Xxxxxxxx Xxxxx XXXX, L.P., each a Delaware limited
partnership and a wholly-owned subsidiary of Sanifill;
WHEREAS, in connection with the consummation of the transactions
contemplated by the Asset Purchase Agreement, Liquids (i) issued to Sanifill a
warrant to purchase shares of common stock of Liquids, dated December 13, 1996
(the "Warrant"), and (ii) executed and delivered to Sanifill that certain Buyer
Non competition Agreement, dated December 13, 1996, whereby Liquids agreed for a
period of five (5) years not to engage in any aspect of the business of
collecting, treating and disposing of municipal solid wastes, construction and
demolition debris within the United States;
WHEREAS, Liquids is aggressively pursuing acquisitions of companies
engaged in the business of managing liquid wastes, some of which companies are
also engaged in the management of solid wastes and/or the recycling of certain
materials;
WHEREAS, Liquids is also exploring the possibility of conducting a public
offering of its Common Stock (the "Public Offering.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. WAIVER OF CERTAIN REGISTRATION RIGHTS. Provided that the Public
Offering is completed by August 1, 1998, Sanifill hereby waives its right to
have any Warrant Shares (as defined in the Warrant) registered for resale in
connection with the Public Offering. Notwithstanding anything to the contrary in
the Warrant, Sanifill further waives its rights under Section 3.2 of the
Warrant; provided, however, that Sanifill's rights under said Section 3.2 shall
be reinstated immediately upon the withdrawal or closing of the currently
contemplated Public Offering, or, if at any time hereafter (i) the registration
statement filed by Liquids on Form S-1, SEC File No. 333-34875 (the
"Registration Statement"), shall cease to include the Warrant Shares, (ii) the
Registration Statement shall be withdrawn prior to the sale of all Warrant
Shares, or (iii) Liquids breaches, in any material respect, any of its duties or
obligations under the Warrant.
2. SUSPENSION OF SHELF REGISTRATION STATEMENT. Sanifill acknowledges that
the Registration Statement will become "stale" immediately following the closing
of several acquisitions to be consummated by Liquids on or about April 15, 1998.
Within thirty (30) days after the closing or withdrawal of the Public Offering,
Liquids shall file a post-effective amendment to the Registration Statement and
use its commercially reasonable efforts to cause such amendment to become
effective.
3. LOCK-UP LETTER. Contemporaneously with the execution of this Agreement,
Sanifill shall execute and deliver to Liquids a lock-up letter in the form
attached hereto as Exhibit "A".
4. PERMITTED ACTIVITIES. Notwithstanding anything to the contrary in the
Buyer Non competition Agreement, Sanifill hereby agrees that (i) Liquids and its
Affiliates (as that term is defined in the Buyer Non competition Agreement)
shall be entitled to (a) sell packaging materials (e.g., aluminum, glass,
plastic and cardboard) recovered from unsaleable beverages accepted for
processing and disposal by the Company and its Affiliates, and (ii) treat and
dispose of municipal solid wastes; provided, however, that the total revenue of
the Company and its Affiliates generated from the treatment and disposal of
municipal solid waste shall not exceed two percent (2%) of their consolidated
revenues in any calendar year.
5. REPRESENTATION OF OWNERSHIP. Sanifill hereby represents that it is the
sole owner of the Warrant, such ownership is free and clear of all liens,
encumbrances or other charges of any kind and no person or entity has any right
to acquire the Warrant or any interest therein.
6. MISCELLANEOUS. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas. This Agreement may not be
modified or amended except by an instrument in writing signed by Sanifill and
Liquids. This Agreement shall inure to the benefit of and shall be binding upon
Sanifill and Liquids and their respective successors and assigns.
IN WITNESS WHEREOF, this Agreement has been duly executed by each of the
parties effective as of the date first above written.
SANIFILL INC.
By: __________________________________
Name: ____________________________
Title:____________________________
U S LIQUIDS INC.
By: _________________________________
Xxxxxxx X. Xxxxxx, Chief Executive
Officer
