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EXHIBIT 10.4
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement dated as of April 21, 1997
(this "Agreement"), by and between Allied Waste Industries, Inc., a Delaware
corporation (the "Company"), on the one hand, and Apollo Investment Fund III,
L.P., a Delaware limited partnership, Apollo Overseas Partners III, L.P., a
Delaware limited partnership, Apollo (U.K.) Partners III, L.P., an English
limited partnership, Blackstone Capital Partners II Merchant Banking Fund L.P.,
a Delaware limited partnership ("BCP"), Blackstone Offshore Capital Partners II
L.P., a Cayman Islands limited partnership, and Blackstone Family Investment
Partnership II L.P., a Delaware limited partnership (collectively,
"Shareholders"), on the other hand.
W I T N E S S E T H:
WHEREAS, (i) prior to the date hereof, Shareholders have
entered into an agreement to purchase an aggregate of 11,776,765 shares (the
"TPG Group Block") of the Company's common stock, par value $.01 per share (the
"Common Stock"), from TPG Partners, L.P., a Delaware limited partnership, and
TPG Parallel I, L.P., a Delaware limited partnership and (ii) concurrently
herewith, Shareholders are entering into an agreement to purchase an aggregate
of 14,600,000 shares (the "Xxxxxxx Block" and, together with the TPG Group
Block, the "Shares") of Common Stock from Xxxxxxx, Inc., a Canadian corporation;
WHEREAS, concurrently herewith, Company and Shareholders are
entering into an Amended and Restated Shareholders Agreement (the "Shareholders
Agreement") granting Shareholders certain rights to designate directors and
setting forth certain restrictions on the acquisition and distribution of
securities of the Company by Shareholders and the conduct of Shareholders with
respect to the Company; and
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WHEREAS, as part of establishing the relationship between
Shareholders and the Company, Shareholders and the Company have agreed to enter
into this Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements contained in this Agreement and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
ARTICLE I
Definitions
1.1. Certain Definitions. In this Agreement:
"Exchange Act" means the United States Securities Exchange Act
of 1934, as amended, and the rules and regulations of the SEC promulgated under
such Act.
"Registrable Securities" means the Shares and any additional
shares of Common Stock acquired by Shareholders in compliance with the
Shareholders Agreement, and any shares of Common Stock issued in connection with
any stock dividend on, or any stock split, reclassification or reorganization of
Shares or such additional shares of Common Stock.
"SEC" means the United States Securities and Exchange
Commission or any successor agency.
"Securities Act" means the United States Securities Act of
1933, as amended, and the rules and regulations of the SEC promulgated under
such Act.
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ARTICLE II
REGISTRATION RIGHTS
2.1. Incidental Rights. If at any time or from time to time
after two years following the date of the closing of the purchase of the Xxxxxxx
Block, Company proposes to file with the SEC a registration statement (whether
on Form X-0, X-0, or S-3, or any equivalent form then in effect) for the
registration under the Securities Act of any shares of Common Stock for sale,
for cash consideration, to the public by Company or on behalf of one or more
shareholders of Company (excluding any sale of securities convertible into or
exercisable for Common Stock, and any shares of Common Stock issuable by Company
upon the exercise of employee stock options, or to any employee stock ownership
plan, or in connection with any acquisition made by Company, any securities
exchange offer, dividend reinvestment plan, employee benefit plan, corporate
reorganization, or in connection with any amalgamation, merger or consolidation
of Company or any direct or indirect subsidiary of Company with one or more
other corporations if Company is the surviving corporation), Company shall give
Shareholders at least 20 days' prior written notice of the proposed filing (or
if 20 days' notice is not practicable, a reasonable shorter period to be not
less than 7 days), which notice shall outline the nature of the proposed
distribution and the jurisdictions in the United States in which Company
proposes to qualify and offer such securities (the "Elected Jurisdictions"). On
the written request of Shareholders received by Company within 15 days after the
date of Company's delivery to Shareholders of the notice of intended
registration (which request shall specify the Registrable Securities sought to
be disposed of by Shareholders and the intended method or methods by which
dispositions are intended to be made), Company shall, under the terms and
subject to the conditions of this Article II, at its own expense as provided in
Section 4.1, include in the coverage of such registration statement (or in a
separate registration statement concurrently filed) and
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qualify for sale under the blue sky or securities laws of the various states in
the Elected Jurisdictions the number of Registrable Securities (the "Specified
Securities") held by Shareholders and which Shareholders have so requested to be
registered or qualified for distribution, to the extent requisite to permit the
distribution (in accordance with the intended method or methods thereof as
aforesaid) in the Elected Jurisdictions requested by Shareholders of such
Registrable Securities.
If the distribution proposed to be effected by Company
involves an underwritten offering of the securities being so distributed by or
through one or more underwriters, and if the managing underwriter of such
underwritten offering indicates in writing its reasonable belief that including
all or part of the Specified Securities in the coverage of such registration
statement or in the distribution to be effected by such prospectus will
materially and adversely affect the sale of securities proposed to be sold
(which statement of the managing underwriter shall also state the maximum number
of shares, if any, which can be sold by Shareholders requesting registration
under this Section 2.1 without materially adversely affecting the sale of the
shares proposed to be sold), then the number of Specified Securities which
Shareholders shall have the right to include in such registration statement
shall be reduced to the maximum number of shares specified by the managing
underwriter. In all cases, priority shall be afforded to securities covered by a
registration statement filed in response to the exercise of a demand
registration right by another holder of Common Stock and no securities proposed
to be sold by such other holder shall be so reduced until all securities
proposed to be sold by all other parties have been entirely eliminated. As to
all other proposed selling shareholders of Common Stock, including Shareholders,
any such reduction in the number of shares of Common Stock proposed to be sold
by the selling shareholders shall be effected on a pro rata basis in accordance
with the relationship which the number of shares of Common
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Stock proposed to be sold by each selling shareholder bears to the number of
shares of Common Stock proposed to be sold by all selling shareholders.
Company shall have the sole right to select any underwriters,
including the managing underwriter, of any public offering of shares of Common
Stock subject to this Section 2.1. Nothing in this Section 2.1 shall create any
liability on the part of Company to Shareholders if Company for any reason
decides not to file or to delay or withdraw a registration statement (which
Company may do in its sole discretion).
Shareholders may request to have Common Stock included in an
unlimited number of registrations under this Section 2.1.
2.2. Demand Rights. Upon written request of Shareholders made
at any time after two years following the date of the closing of the purchase of
the Xxxxxxx Block, Company shall, under the terms and subject to the conditions
set forth in this Section 2.2, and Sections 2.3 and 2.4, file (and use its
reasonable efforts to cause to become effective) a registration statement
covering, and use its reasonable efforts to qualify for sale under the blue sky
or securities laws of the various states of the United States as may be
requested by Shareholders (except any such state in which, in the opinion of the
managing underwriter of the offering, the failure to so qualify would not
materially and adversely affect the proposed offering), in accordance with the
intended method or methods of disposition set forth in that notice, of such
number of Registrable Securities, as may be designated by Shareholders in their
request, or that portion thereof designated in said request for registration in
each of the Designated Jurisdictions (as defined below). A request for
registration under this Section 2.2 shall specify the number of shares to be
registered, the jurisdictions in the United States in which such registration is
to be effected (the "Designated Jurisdictions") and the proposed manner of sale,
including the name and address of any proposed underwriter; provided, that all
offerings
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contemplated by a request for registration under this Section 2.2 shall be
underwritten offerings involving a distribution of Registrable Shares to the
public in which reasonable efforts are made not to knowingly sell to any single
buyer, acting individually or with others, who after such underwriting will own
more than 9% of the Total Voting Power (as defined in the Shareholders
Agreement) (any such buyer, "Significant Stockholder"), under circumstances in
which it would reasonably be expected to not result in any person becoming
Significant Stockholder. The principal underwriter or underwriters for any such
offering shall be selected by Shareholders, subject to Company's approval, which
may not be unreasonably withheld. Notwithstanding any other provision in this
Section, Shareholders shall not be permitted to make a demand for registration
pursuant to this Section unless the number of Registrable Securities covered by
such demand is at least five million shares (as such number may be appropriately
adjusted to reflect stock splits, reverse stock splits, dividends and any other
recapitalization or reorganization of Company).
If the distribution proposed to be effected pursuant to this
Section 2.2 involves an underwritten offering of Registrable Securities and
securities of the Company other than Registrable Securities ("Other
Securities"), and if the managing underwriter of such underwritten offering
indicates in writing its reasonable belief that including all or part of such
securities in the coverage of such registration statement will materially and
adversely affect the sale of the securities proposed to be sold, then the number
of securities proposed to be sold shall be reduced to the maximum number of
securities specified by the managing underwriter. In such a case, priority shall
be afforded to Registrable Securities, and such Other Securities shall be
completely eliminated before the number of Registrable Securities is reduced.
Company may delay the filing of any registration statement
requested under this Section 2.2, or delay its effectiveness, for a reasonable
period (but not longer than 90
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days) if, in the sole judgment of Company's Board of Directors, (i) a delay is
necessary in light of pending financing transactions, corporate reorganizations,
or other major events involving Company, or (ii) filing at the time requested
would materially and adversely affect the business or prospects of Company in
view of disclosures that may be thereby required. Once the cause of the delay is
eliminated, Company shall promptly notify Shareholders and, promptly after
Shareholders notify Company to proceed, Company shall file a registration
statement and begin performance of its other obligations under this Section 2.2.
Shareholders shall be entitled to request not more than three
registrations under this Section 2.2 (provided that the filing of a registration
statement in more than one Designated Jurisdiction in connection with a
concurrent or substantially concurrent distribution shall be deemed for the
purposes of this Agreement to be a single registration). However, if
Shareholders request a registration under this Section 2.2, but no registration
statement becomes effective with respect to the Registrable Securities covered
by such request, then such request shall not count as a request for purposes of
determining the number of requests for registration Shareholders may make under
this Section 2.2.
If there is an effective registration statement requested by
the Shareholders pursuant to this Section 2.2, the Shareholders may require the
Company to delay the filing of any registration statement relating to shares of
Common Stock or delay its effectiveness, for a reasonable period (but not longer
than 90 days) if, in the sole judgment of the Shareholders, a delay is necessary
in order to avoid materially and adversely affecting the disposition of Shares
pursuant to the offering by the Shareholders; provided that the foregoing shall
not limit the Company's right to file and have declared effective registration
statements relating to shares of Common Stock issuable pursuant to employee
benefit plans of the Company or any of its subsidiaries or issuable pursuant to
a
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merger, acquisition or similar transaction involving the Company or any of its
subsidiaries.
2.3. Registration Conditions. Notwithstanding any other
provision of this Agreement, Company shall not be required to effect a
registration of any securities under this Article II, or file any post-effective
amendment to such a registration statement relating to such a qualification:
(a) unless Shareholders agree to (x) sell
and distribute a portion or all of their Registrable Securities in
accordance with the plan or plans of distribution adopted by and
through underwriters, if any, acting for Company or any such other
sellers of Common Stock, and (y) bear a pro rata share of underwriter's
discounts and commissions;
(b) if a registration requested under
Section 2.2, or any post-effective amendment to the registration
statement filed in connection therewith, requires, under applicable
statutes and rules, a special audit (other than a normal fiscal
year-end audit) of any financial statements, unless Shareholders agree
to pay their proportionate share (determined by the number of shares to
be sold by Shareholders in the offering in proportion to the total
number of shares to be sold by Company and all other participants in
such offering) of the reasonable fees and expenses of accountants
incurred in connection with the special audit and which would otherwise
not be incurred; provided that Shareholders shall not be required to
pay any share of such fees and expenses if such audit would otherwise
be required at substantially the same time to satisfy the Company's
reporting requirements under the Exchange Act absent such registration;
(c) if, in the case of a request for
registration under Section 2.2, (x) any offering pursuant to a
registration statement covering securities regarding
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which Shareholders could have exercised registration rights under
Section 2.1 of this Agreement has been completed within the prior 90
days, (y) a registration statement requested by Shareholders pursuant
to Section 2.2 has become effective under the Securities Act within the
prior twelve months, or (z) Company has given notice under Section 2.1
of its intention to file a registration statement under the Securities
Act and has not completed or abandoned the proposed offering; and
(d) unless Company has received from
Shareholders all information Company has reasonably requested
concerning Shareholders and their method of distribution of Registrable
Securities, so as to enable Company to include in the registration
statement all facts required to be disclosed in it.
2.4. Covenants and Procedures. If Company becomes obligated
under this Article II to effect a registration of Registrable Securities on
behalf of Shareholders, then (as applicable to the jurisdictions for which such
registration is to be made):
(a) Company, at its expense as provided in
Section 4.2, shall prepare and file with the SEC a registration
statement covering such securities and such other related documents as
may be necessary or appropriate relating to the proposed distribution,
and shall use reasonable efforts to cause the registration statement to
become effective. Company will also, with respect to any registration
statement, file such post-effective amendments to the registration
statement (and use reasonable efforts to cause them to become
effective) and such supplements as are necessary so that current
prospectuses are at all times available for a period of at least 90
days after the effective date of the registration statement or for such
longer period, not to exceed 180 days, as may be required under the
plan or plans of distribution set forth in the registration statement.
Shareholders shall promptly provide Company with such information with
respect to Shareholders' Registrable
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Securities to be so registered and, if applicable, the proposed terms
of their offering, as is required for the registration. If the
Registrable Securities to be covered by the registration statement are
not to be sold to or through underwriters acting for Company, Company
shall:
(i) deliver to Shareholders, as promptly as
practicable, as many copies of preliminary prospectuses as
Shareholders may reasonably request (in which case
Shareholders shall keep a written record of the distribution
of the preliminary prospectuses and shall refrain from
delivery of the preliminary prospectuses in any manner or
under any circumstances which would violate the Securities Act
or the securities laws of any other jurisdiction, including
the various states of the United States);
(ii) deliver to Shareholders, as soon as
practicable after the effective date of the registration
statement, and from time to time thereafter during the
applicable period described in Section 2.4, as many copies of
the relevant prospectuses as Shareholders may reasonably
request; and
(iii) in case of the happening, after the
effective date of the registration statement and during the
applicable 90 or 180-day period described in the second
sentence of Section 2.4(a), of any event or occurrence as a
result of which the prospectus, as then in effect, would
include an untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary to make any statement therein not misleading in the
light of the circumstances in which it was made, give
Shareholders written notice of the event or occurrence and
prepare and furnish to Shareholders, in such quantities as it
may reasonably request, copies of an amendment of or a
supplement to such prospectus as may be
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necessary so that the prospectus, as so amended or
supplemented and thereafter delivered to purchasers of the
securities, will not contain any untrue statement of a
material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein,
in the light of the circumstances under which it was made, not
misleading.
(b) Company will notify Shareholders of any action by
the SEC or any Commission to suspend the effectiveness of any
registration statement filed pursuant hereto or the initiation or
threatened initiation of any proceeding for such purpose or the receipt
by Company of any notification with respect to the suspension of the
qualification of the securities for sale in any jurisdiction.
Immediately upon receipt of any such notice, Shareholders shall cease
to offer or sell any Registrable Securities pursuant to the
registration statement or prospectus in the jurisdiction to which such
order or suspension relates. Company will also notify Shareholders
promptly of the occurrence of any event or the existence of any state
of facts that, in the judgment of Company, should be set forth in such
registration statement or prospectus. Immediately upon receipt of such
notice, Shareholders shall cease to offer or sell any Registrable
Securities pursuant to such registration statement or prospectus, cease
to deliver or use such registration statement or prospectus and, if so
requested by Company, return to Company at Company's expense all copies
of such registration statement or prospectus. Company will as promptly
as practicable take such action as may be necessary to amend or
supplement such registration statement or prospectus in order to set
forth or reflect such event or state of facts and provide copies of
such proposed amendment or supplement to Shareholders.
(c) On or before the date on which the registration
statement is declared effective, Company shall use its reasonable
efforts to:
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(i) register or qualify (and cooperate with
Shareholders, the underwriter or underwriters, if any, and
their counsel, in connection with the registration or
qualification of) the securities covered by the registration
statement for offer and sale under the securities or blue sky
laws of each state and other jurisdiction as Shareholders or
any underwriter reasonably requests;
(ii) use its reasonable efforts to keep each
such registration or qualification effective, including
through new filings, or amendments or renewals, during the
period the registration statement or prospectus is required to
be kept effective; and
(iii) do any and all other acts or things
necessary or advisable to enable the disposition in all such
jurisdictions of the Common Stock covered by the applicable
registration statement, provided that Company will not be
required to qualify generally to do business in any
jurisdiction where it is not then so qualified.
(d) Company shall use its reasonable efforts to cause
all Registrable Securities of Shareholders included in the registration
statement to be listed, by the date of the first sale of such shares
pursuant to such registration statement, on each securities exchange on
which the securities is then listed or proposed to be listed, if any.
(e) Company shall make generally available to
Shareholders and any underwriter participating in the offering
conducted pursuant to the registration statement an earnings statement
satisfying Section 11(a) of the Securities Act no later than 45 days
after the end of the 12-month period beginning with the first day of
Company's first fiscal quarter commencing after the effective date of
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the registration statement. The earnings statement shall cover such
12-month period. This requirement will be deemed to be satisfied if
Company timely files complete and accurate information on Forms 10-Q,
10-K, and 8-K under the Exchange Act, and otherwise complies with Rule
158 under the Securities Act as soon as feasible.
(f) Company shall cooperate with Shareholders and the
managing underwriter or underwriters, if any, to facilitate the timely
preparation and delivery of certificates (not bearing any restrictive
legends) representing Registrable Securities to be sold under the
registration statement, and to enable such securities to be in such
denominations and registered in such names as the managing underwriter
or underwriters, if any, or Shareholders, may request, subject to the
underwriters' obligation to return any certificates representing unsold
securities.
(g) Company shall use its reasonable efforts to cause
Registrable Securities covered by the registration statement to be
registered with or approved by such other governmental agencies or
authorities in the United States (including the registration of
Registrable Securities under the Exchange Act) as may be necessary to
enable Shareholders or the underwriter or underwriters, if any, to
consummate the disposition of such securities.
(h) Company shall, during normal business hours and
upon reasonable notice, make available for inspection by Shareholders,
any underwriter participating in any offering pursuant to the
registration statement, and any attorney, accountant or other agent
retained by Shareholders or any such underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate
documents, and properties of Company (including non-public
information), as shall be reasonably necessary to enable the Inspectors
to exercise
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their due diligence responsibilities; provided that any Inspector
receiving non-public information shall have previously entered into an
appropriate confidentiality agreement in mutually satisfactory form and
substance. Company shall also cause its officers, directors, and
employees to supply all nonconfidential information reasonably
requested by any Inspector in connection with the registration
statement.
(i) Company shall use its reasonable efforts to
obtain a "cold comfort" letter and, as applicable, a "long-form comfort
letter" from Company's independent public accountants, and an opinion
of counsel for Company, each in customary form and covering such
matters of the type customarily covered by cold comfort letters and
long form comfort letters and legal opinions in connection with public
offerings of securities, as Shareholders reasonably request.
(j) Company shall enter into such customary
agreements (including an underwriting agreement containing such
representations and warranties by Company and such other terms and
provisions, as are customarily contained in underwriting agreements for
comparable offerings and are reasonably satisfactory to the Company)
and take all such other actions as Shareholders or the underwriters
participating in such offering and sale may reasonably request in order
to expedite or facilitate such offering and sale (other than such
actions which are disruptive to the Company or require significant
management availability).
ARTICLE III
INDEMNIFICATION
3.1. Indemnification by Company. In the event of any
registration under the Securities Act by any registration statement pursuant to
rights granted in this
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Agreement of Registrable Securities held by Shareholders, Company will hold
harmless Shareholders and each underwriter of such securities and each other
person, if any, who controls any Shareholder or such underwriter within the
meaning of the Securities Act, against any losses, claims, damages, or
liabilities (including legal fees and costs of court), joint or several, to
which Shareholders or such underwriter or controlling person may become subject
under the Securities Act or otherwise, insofar as such losses, claims, damages,
or liabilities (or any actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact (i)
contained, on its effective date, in any registration statement under which such
securities were registered under the Securities Act or any amendment or
supplement to any of the foregoing, or which arise out of or are based upon the
omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or (ii)
contained in any preliminary prospectus, if used prior to the effective date of
such registration statement, or in the final prospectus (as amended or
supplemented if Company shall have filed with the SEC any amendment or
supplement to the final prospectus) if used within the period which Company is
required to keep the registration to which such registration statement or
prospectus relates current under Section 2.4, or which arise out of or are based
upon the omission or alleged omission (if so used) to state a material fact
required to be stated in such prospectus or necessary to make the statements in
such prospectus not misleading; and will reimburse Shareholders and each such
underwriter and each such controlling person for any legal or any other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, or liability; provided, however, that Company shall
not be liable to any Shareholder or its underwriters or controlling persons 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 such registration statement or such
amendment or supplement, in reliance upon and in
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conformity with information furnished to Company through a written instrument
duly executed by Shareholders or such underwriter specifically for use in the
preparation thereof.
3.2. Indemnification by Shareholders. It shall be a condition
precedent to the obligation of Company to include in any registration statement
any Registrable Securities of Shareholders that Company shall have received from
Shareholders an undertaking, reasonably satisfactory to Company and its counsel,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in Section 3.1) Company, each director of Company, each officer of Company
who shall sign the registration statement, and any person who controls Company
within the meaning of the Securities Act, (i) with respect to any statement or
omission from such registration statement, or any amendment or supplement to it,
if such statement or omission was made in reliance upon and in conformity with
information furnished to Company through a written instrument duly executed by
Shareholders specifically for use in the preparation of such registration
statement or amendment or supplement, and (ii) with respect to compliance by
Shareholders with applicable laws in effecting the sale or other disposition of
the securities covered by such registration statement.
3.3 Indemnification Procedures. Promptly after receipt by an
indemnified party of notice of the commencement of any action involving a claim
referred to in the preceding Sections of this Article III, the indemnified party
will, if a resulting claim is to be made or may be made against and indemnifying
party, give written notice to the indemnifying party of the commencement of the
action. If any such action is brought against an indemnified party, the
indemnifying party will be entitled to participate in and to assume the defense
of the action with counsel reasonably satisfactory to the indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election to assume defense of the action, the indemnifying party
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will not be liable to such indemnified party for any legal or other expenses
incurred by the latter in connection with the action's defense. An indemnified
party shall have the right to employ separate counsel in any action or
proceeding and participate in the defense thereof, but the fees and expenses of
such counsel shall be at such indemnified party's expense unless (a) the
employment of such counsel has been specifically authorized in writing by the
indemnifying party, which authorization shall not be unreasonably withheld, (ii)
the indemnifying party has not assumed the defense and employed counsel
reasonably satisfactory to the indemnified party within 30 days after notice of
any such action or proceeding, or (iii) the named parties to any such action or
proceeding (including any impleaded parties) include the indemnified party and
the indemnifying party and the indemnified party shall have been advised by such
counsel that there may be one or more legal defenses available to the
indemnified party that are different from or additional to those available to
the indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action or proceeding on behalf of the
indemnified party), it being understood, however, that the indemnifying party
shall not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys (in addition to all local
counsel which is necessary, in the good faith opinion of both counsel for the
indemnifying party and counsel for the indemnified party in order to adequately
represent the indemnified parties) for the indemnified party and that all such
fees and expenses shall be reimbursed as they are incurred upon written request
and presentation of invoices. Whether or not a defense is assumed by the
indemnifying party, the indemnifying party will not be subject to any liability
for any settlement made without its consent. No indemnifying party will consent
to entry of any judgment or enter into any settlement which does not include as
an unconditional term the
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giving by the claimant or plaintiff, to the indemnified party, of a release from
all liability in respect of such claim or litigation.
3.4. Contribution. If the indemnification required by this
Article III from the indemnifying party is unavailable to or insufficient to
hold harmless an indemnified party in respect of any indemnifiable losses,
claims, damages, liabilities, or expenses, then the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a result of
such losses, claims, damages, liabilities, or expenses in such proportion as is
appropriate to reflect (i) the relative benefit of the indemnifying and
indemnified parties and (ii) if the allocation in clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect the relative
benefit referred to in clause (i) and also the relative fault of the indemnified
and indemnifying parties, in connection with the actions which resulted in such
losses, claims, damages, liabilities, or expenses, as well as any other relevant
equitable considerations. The relative fault of the indemnifying party and the
indemnified party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact, has been made by, or relates to information supplied by,
such indemnifying party or parties, and the parties' relative intent, knowledge,
access to information, and opportunity to correct or prevent such action. The
amount paid or payable by a party as a result of the losses, claims, damage,
liabilities, and expenses referred to above shall be deemed to include any legal
or other fees or expenses reasonably incurred by such party in connection with
any investigation or proceeding. Company and Shareholders agree that it would
not be just and equitable if contribution pursuant to this Section 3.4 were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the prior
provisions of this Section 3.4.
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Notwithstanding the provisions of this Section 3.4, no
indemnifying party shall be required to contribute any amount in excess of [the
amount by which the total price at which the securities were offered to the
public by the indemnifying party exceeds the amount of any damages which the
indemnifying party has otherwise been required to pay by reason of an untrue
statement or omission]. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such a fraudulent
misrepresentation.
ARTICLE IV
OTHER AGREEMENTS
4.1. Other Registration Rights. Company agrees that it will
not grant to any party registration rights which would allow such party to limit
Shareholders' priority for the sale or distribution of Registrable Securities
upon the exercise of a demand registration right pursuant to Section 2.2.
4.2. Expenses. All expenses incurred by Company in connection
with any registration statement covering Registrable Securities offered by
Shareholders, including, without limitation, all registration and filing fees
(including all expenses incident to filing with the National Association of
Securities Dealers, Inc.), printing expenses, fees and disbursements of counsel
(except for the fees and disbursements of counsel for Shareholders) and of the
independent certified public accountants (except, in the case of any special
audits, if required in connection with any such registration, Shareholders'
proportionate share of their expense as provided in Section 2.4), and the
expense of qualifying such shares under state blue sky laws, shall be borne by
Company, including such expenses of any registration delayed by the Company
under the fourth paragraph of Section 2.2; provided, however, that Company shall
not be required to pay
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for any expenses of any registration proceeding begun pursuant to Section 2.2 if
the registration request is subsequently withdrawn at the request of
Shareholders (in which case Shareholders shall bear such expenses), unless
Shareholders agrees to forfeit their right to one demand registration under
Section 2.2; provided further, however, that if at the time of such withdrawal,
Shareholders have learned of a material adverse change in the condition,
business, or prospects of the Company from that known at the time of its
request, then Shareholders shall not be required to pay any of such expenses and
shall retain their rights pursuant to Section 2.2. Company's obligations under
this Section 4.2 shall apply to each registration under the Securities Act or
state blue sky legislation pursuant to Section 2.2. However, all underwriting
expenses incurred by Shareholders, including underwriter's discounts and
commissions and legal, accounting and similar expenses, shall be borne by
Shareholders.
4.3. Dispositions During Registration. Each Shareholder agrees
that, without the consent of the managing underwriter(s) in an underwritten
offering in respect of Common Stock or securities convertible into Common Stock,
it will not effect any sale or distribution of Common Stock or securities
convertible into Common Stock (other than Registrable Securities included in
such offering), during the ten (10) day period prior to, and during the ninety
(90) day period beginning on, the effective date of the registration statement
filed by the Company in respect of such underwritten offering, or any shorter
period as may apply to the Company and its affiliates.
4.4. Transfer of Rights. All rights of Shareholders under this
Agreement shall be transferable by Shareholders to a Related Transferee (as
defined in the Shareholders Agreement) who acquires shares of Common Stock in
compliance with Section 4.1(f) of the Shareholders Agreement and who executes an
instrument in form and substance satisfactory to the Company in which it agrees
to be bound by the terms of this Agreement as if an original signatory hereto,
in which case such Related Transferee
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shall thereafter be a "Shareholder" for all purposes of this Agreement. The
incidental registration rights or benefits of this Agreement and the demand
registration rights, including indemnification by Company, shall be transferable
by Shareholders only in a transaction permitted under Section 4.1(c) or 4.1(d)
of the Shareholders Agreement to a transferee that is not an Affiliate of the
Company who receives at least an aggregate of 1,000,000 shares of Common Stock,
in the case of incidental registration rights, or 5,000,000 shares of Common
Stock for each right to demand registration, in the case of demand registration
rights. In the case of any assignment, the party or parties who have the rights
and benefits of Shareholders under this Agreement shall become parties to and be
subject to this Agreement, and shall not, as a group, have the right to request
any greater number of registrations than Shareholders would have had if no
assignment had occurred. Upon any transfer of the registration rights or
benefits of this Agreement, Shareholders shall give Company written notice prior
to or promptly following such transfer stating the name and address of the
transferee and identifying the securities with respect to which such rights are
being assigned. Such notice shall include or be accompanied by a written
undertaking by the transferee to comply with the obligations imposed hereunder.
In the event any registration rights are transferred in accordance with the
terms of this Agreement, any actions required to be taken by Shareholders will
be taken with the approval of the holders of such registration rights who hold a
majority of the Registrable Securities, whose actions shall bind all such
holders of such registration rights.
4.5. Best Registration Rights. If the Company grants to any
Person with respect to any security issued by the Company or any of its
Affiliates registration rights that provide for terms that are in any manner
more favorable to the holder of such registration rights than the terms granted
to the Shareholders other than the number of demand registrations or the minimum
amount of shares required to exercise demand
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registration rights (or if the Company amends or waives any provision of any
agreement providing registration rights of others or takes any other action
whatsoever to provide for terms that are more favorable to other holders than
the terms provided to the Shareholders other than the number of demand
registrations or the minimum amount of shares required to exercise demand
registration rights), then this Agreement shall immediately be deemed amended to
provide the Shareholders with any (or all) of such more favorable terms as
Shareholders shall elect to include herein.
ARTICLE V
MISCELLANEOUS
5.1. Notices. All notices, requests, demands and other
communications required or permitted hereunder shall be made in writing by
hand-delivery, registered first-class mail, telex, fax or air courier
guaranteeing delivery:
(a) If to the Company, to:
Allied Waste Industries, Inc.
0000 Xxxx Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
Fax: (000) 000-0000
with copies to:
Xxxxxx & Xxxxxx, L.L.P.
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxx X. Xxxxx
Fax: (000) 000-0000
and to:
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
One Xxx Xxxx Xxxxx
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00
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxxx, Xx.
Fax: (000) 000-0000
or to such other person or address as the Company shall furnish to Shareholders
in writing;
(b) If to Shareholders, to:
Apollo Management, L.P.
0000 Xxxxxx xx xxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
Fax: (000) 000-0000
with a copy to:
Milbank, Tweed, Xxxxxx & XxXxxx
000 Xxxxx Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
and:
The Blackstone Group
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx
Fax: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
or to such other person or address as Shareholders shall furnish to the Company
in writing.
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All such notices, requests, demands and other communications
shall be deemed to have been duly given: at the time of delivery by hand, if
personally delivered; five (5) Business Days after being deposited in the mail,
postage prepaid, if mailed domestically in the United States (and seven (7)
Business Days if mailed internationally); when answered back, if telexed; when
receipt acknowledged, if telecopied; and on the Business Day for which delivery
is guaranteed, if timely delivered to an air courier guaranteeing such delivery.
5.2. Section Headings. The article and section headings in
this Agreement are for reference purposes only and shall not affect the meaning
or interpretation of this Agreement. References in this Agreement to a
designated "Article" or "Section" refer to an Article or Section of this
Agreement unless otherwise specifically indicated.
5.3. Governing Law. This Agreement shall be construed and
enforced in accordance with and governed by the law of Delaware, without regard
to its conflicts of laws principles.
5.4. Consent to Jurisdiction and Service of Process. Any legal
action or proceeding with respect to this Agreement or any matters arising out
of or in connection with this Agreement (other than the Shareholders Agreement,
which shall be governed solely by the analogous provisions thereof), and any
action for enforcement of any judgment in respect thereof shall be brought
exclusively in the state of federal courts located in the State of Delaware,
and, by execution and delivery of this Agreement, the Company and Shareholder
each irrevocably consent to service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, or by recognized international
express carrier or delivery service, to the Company or Shareholder at their
respective
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addresses referred to in this Agreement. The Company and the Shareholder each
hereby irrevocably waives any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Agreement (other than the Shareholders Agreement,
which shall be governed solely by the analogous provisions thereof) brought in
the courts referred to above and hereby further irrevocably waives and agrees,
to the extent permitted by applicable law, not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum. Nothing in this Agreement shall affect the
right of any party hereto to serve process in any other manner permitted by law.
5.5. Amendments. This Agreement may be amended only by an
instrument in writing executed by all of its parties.
5.6. Entire Agreement. This Agreement and the Shareholders
Agreement constitute the entire agreement and understanding of the parties with
respect to the transactions contemplated hereby and thereby. The registration
rights granted under this Agreement supersede any registration, qualification or
similar rights with respect to any of the Shares granted under any other
agreement, and any of such preexisting registration rights are hereby
terminated. This Agreement may be amended only by a written instrument duly
executed by the parties or their respective successors or assigns; provided,
however, that any amendment or waiver by the Company shall be made only with the
prior approval of a majority of the entire Board of Directors of the Company
other than Shareholder Designees (as defined in the Shareholders Agreement).
5.7. Severability. The invalidity or unenforceability of any
specific provision of this Agreement shall not invalidate or render
unenforceable any of its other provisions. Any provision of this Agreement held
invalid or unenforceable shall be deemed reformed, if practicable, to the extent
necessary to render it valid and enforceable
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and to the extent permitted by law and consistent with the intent of the parties
to this Agreement.
5.8. Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which
together shall constitute the same instrument.
5.9. Shareholder Action. The Company shall be entitled to rely
upon any written notice, designation, or instruction signed by Apollo Capital
Management II, Inc. and BCP (the "Representatives") as a notice, designation or
instruction of all Shareholders and the Company shall not be liable to any
Shareholder if the Company acts in accordance with and relies upon such writing.
In that regard, each of the Shareholders acknowledges that the Representatives
have full power and authority to act on their behalf.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
ALLIED WASTE INDUSTRIES, INC.
By: /s/ Xxxxxx X. Xxx Xxxxxxx
-------------------------------------------
Title: President
APOLLO INVESTMENT FUND III, L.P.
APOLLO OVERSEAS PARTNERS III, L.P.
APOLLO (U.K.) PARTNERS III, L.P.
By: Apollo Advisors II, L.P.
By: Apollo Capital Management II, Inc.
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Title: V.P.
BLACKSTONE CAPITAL PARTNERS II
MERCHANT BANKING FUND X.X.
XXXXXXXXXX OFFSHORE CAPITAL
PARTNERS II X.X.
XXXXXXXXXX FAMILY INVESTMENT
PARTNERSHIP II L.P.
By: Blackstone Management Associates II L.L.C.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------------
Title: Senior Managing Director
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