Exhibit 2.4
THIRD AMENDMENT TO ACQUISITION AGREEMENT
WHEREAS, Safety-Kleen Services, Inc. (the "Seller") and Clean Harbors, Inc.
(the "Purchaser"), are parties to an Acquisition Agreement dated as of February
22, 2002, as amended by the First Amendment to Acquisition Agreement dated as of
March 8, 2002, and the Second Amendment to Acquisition Agreement dated as of
April 30, 2002 (as so amended, the "Acquisition Agreement");
WHEREAS, the Seller and the Purchaser wish to amend certain provisions of
the Acquisition Agreement as set forth in this Third Amendment to Acquisition
Agreement (this "Amendment");
NOW, THEREFORE, the parties hereto agree as follows:
1. Section 1.1(a) of the Acquisition Agreement is hereby amended to read
as follows: "(a) all of the outstanding equity interests (the "Interests") of
the subsidiaries of the Seller set forth on Schedule 1.1(a) (each a "Transferred
Sub" and collectively the "Transferred Subs"), provided that in the case of
Xxxxxxx Environmental Services de Mexico, S.A. de C.V. ("LES Mexico"), the
Interest of LES Mexico will be transferred post-Closing in the manner specified
in Section 1.9."
2. Section 1.1(b) of the Acquisition Agreement and, to the extent
required, any other Sections of the Acquisition Agreement are hereby amended to
provide that (i) the transfer of the Owned Real Property in Clarence, NY, and
the insurance proceeds to be received as a result of the fire which recently
occurred on such Owned Real Property will be dealt with in such manner as shall
be mutually agreed by the Purchaser and the Seller in the Transition Services
Agreement and (ii) the property in Millington, Tennessee is to be removed from
the schedule of Owned Real Property that is to be transferred.
3. Section 1.1(b)(i) of the Acquisition Agreement is hereby amended to
read as follows: "(i) all accounts receivable (which are not excluded pursuant
to Section 1.2 (b)) arising out of the operation of the Business existing on the
date hereof including, without limitation, those listed or described on Schedule
1.1(b)(i), or arising in the ordinary course of the Business after the date
hereof (the "Accounts Receivable");"
4. Section 1.2(s) [which is currently incorrectly numbered as a second
Section 1.2(i)] of the Acquisition Agreement is hereby amended to read as
follows: "(s) that certain promissory note from Xxxxxxx-Xxxx LLC dated June 15,
2001 and that certain promissory note from Xxxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxx
and Dizzy Bridge Realty Trust executed in 1994 and extended in October, 1997;
and"
5. Section 1.6(a) of the Acquisition Agreement is hereby amended to read
as follows:
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(a) In consideration for the Acquired Assets, the Purchaser shall, in
addition to the assumption of the Assumed Liabilities, pay in cash at
Closing (inclusive of the delivery to the Seller of the Purchaser's Deposit
as described in Section 5.2(k)): (i) to the Seller the difference between
(A) Thirty-Four Million Three Hundred and Thirty Thousand Dollars
($34,330,000) (the "Unadjusted Cash Purchase Price") and (B) the
adjustments to the Unadjusted Cash Purchase Price set forth on the Closing
Statement attached to this Third Amendment, which include adjustments made
in accordance with Sections 1.4 and 1.6(b), and (ii) to the applicable
parties set forth on the Closing Statement attached to this Third
Amendment, which payments shall be made by wire transfer of immediately
available funds to an account or accounts designated by the Seller and the
applicable parties, as the case may be. The Unadjusted Cash Purchase Price,
as it may be adjusted pursuant to Section 1.7 , shall be referred to as the
"Cash Purchase Price" under this Agreement.
6. Section 1.7(a) of the Acquisition Agreement is hereby amended by (i)
amending the second from the last sentence thereof so that such sentence shall
read: "The Seller shall return to the Purchaser the amount of any Working
Capital Deficiency"; and (ii) deleting the next to the last sentence thereof
(which currently reads: "If and to the extent the Escrow Agent shall not be
holding enough funds in the Escrow Account, the Seller shall return to the
Purchaser the amount of any Working Capital Deficiency").
7. Section 1.8 of the Acquisition Agreement is hereby deleted in its
entirety and replaced with the following: "The Seller and the Purchaser agree
that Seventy-Four Million U.S. Dollars ($74,000,000) shall be allocated as
purchase price to the stock of Safety-Kleen Ltd. and that the balance of the
purchase price shall be allocated to the other Acquired Assets."
8. Section 1.9 is hereby added to the Acquisition Agreement and reads as
follows: "As soon as practicable following Closing, Purchaser and Seller shall
take the actions described in those certain letters dated August 20 and 28, 2002
from L. Xxxxxxx Xxxxxxxxx R. to Xx. Xxxxx XxXxxxx and such further actions
needed to convey the Interests of LES Mexico to Purchaser."
9. Section 2.2(a)(i) of the Acquisition Agreement is hereby amended to
read: "(i) duly executed instruments or other evidence sufficient to transfer to
the Purchaser and the Purchasing Subs the Interests of Safety-Kleen Ltd."
10. Subsection 2.2(a)(iii) of the Acquisition Agreement is hereby amended
to read as follows: "(iii) all other conveyance documents reasonably necessary
to transfer to the Purchaser and the Purchasing Subs the Acquired Assets,
including special warranty deeds regarding the Owned Real Property purchased by
the Purchaser and the Purchasing Subs provided that, in the case of the Owned
Real Property in Xxxxxxxxxxxx, CA, the delivery of any such special warranty
deed will dealt with in such manner as shall be mutually agreed by the Purchaser
and the Seller in the Transition Services Agreement;"
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11. Sections 2.2(a)(vi) of the Acquisition Agreement are hereby amended to
change the words "by May 24, 2002" to "prior to the Closing."
12. Sections 2.2(a)(viii) and 2.2(b)(v) of the Acquisition Agreement are
hereby amended to delete the provisions set forth in such Sections and replace
such deleted provisions with the following: "Intentionally omitted." Any
reference to the defined term "Sales Agency Agreement" is herby accordingly
deleted in the Acquisition Agreement due to the amendments to such Sections.
13. Subsections 2.2(a)(ix) and 2.2(b)(vi) of the Acquisition Agreement
(which now provide for the delivery at the Closing of the Escrow Agreement) are
hereby deleted and subsections 2.2(a)(x) through 2.2(a)(xv) (and the cross
reference thereto in subsection 6.3(m)) and subsection 2.2(b)(vii) are hereby
accordingly renumbered to reflect such deletions.
14. Section 2.2(a)(xii) of the Acquisition Agreement is hereby amended to
read as follows: "certificates of tax and legal good standing and releases from
secured lenders evidencing that each of Safety-Kleen Ltd. and its direct and
indirect subsidiaries (Safety-Kleen Ltd. and such direct or indirect
subsidiaries being collectively the "CSD Canadian Subsidiaries") is in good
standing and that the secured lenders of the CSD Canadian Subsidiaries have
released all of their claims against the CSD Canadian Subsidiaries and security
interests on the assets of the CSD Canadian Subsidiaries and on the issued and
outstanding equity interests of the CSD Canadian Subsidiaries, together with a
copy of a Section 116 Certificate issued to the Seller in form satisfactory to
the Purchaser with respect to the Seller's sale to the Purchaser of the
Interests in Safety-Kleen Ltd.;
15. Section 5.12 of the Acquisition Agreement is hereby amended by
replacing the fourth sentence of such Section with the following four sentences:
"After the Closing, the Seller shall not reject any executory contracts or
unexpired leases with respect to the Business until the earlier of (i) the
Confirmation Date and (ii) the date the Purchaser notifies the Seller that it no
longer will assume executory contracts or unexpired leases (the earlier of such
dates being referred to as the "Contract Expiration Date"), provided that,
Purchaser agrees, pursuant to any executory contract and unexpired leases, to
provide waste management services to Seller's former customers of the Business
until the date of the court hearing to consider the rejection of the executory
contracts or unexpired leases following the Contract Expiration Date (the
"Contract Hearing Date"), and provided further, Purchaser agrees, pursuant to
any executory contracts and unexpired leases, to pay the vendors of the Business
for their services until the Contract Hearing Date. The obligations of the
Purchaser in the preceding sentence, including any breach or damages caused by
the Purchaser's continued use of the contracts, leases or services, shall be
considered Assumed Liabilities for purposes of the indemnification provisions of
Article VIII of the Acquisition Agreement. During the period between the Closing
and the Contract Expiration Date, the Purchaser and the Seller shall each pay
one-half of any Cure Costs of any executory contracts and unexpired leases that
Purchaser wishes to assume until the sum of (a) the Cure Costs paid as of the
Closing and (b) the Cure Costs paid post-Closing equal the Cure Costs Cap.
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Thereafter, Purchaser shall pay all of the Cure Costs of any executory contracts
and unexpired leases that Purchaser wishes to assume."
16. Section 5.15(h) is added to the Acquisition Agreement and shall read
as follows: "(h) Nothing in this Section 5.15 shall prohibit the Seller in any
manner from continuing to operate and grow its fuels and tolling businesses."
17. Section 6.3(d) of the Acquisition Agreement is hereby amended to
delete the provisions set forth in such Section and replace such deleted
provisions with the following: "Intentionally omitted."
18. Sections 3.11 and 8.15 of the Acquisition Agreement are hereby amended
by: (i) deleting the second sentence of Section 3.11 and revising and inserting
such sentence immediately after the first sentence of Section 8.15 so that such
sentence shall read as follows: "The Seller shall be responsible for the payment
of all Taxes (including, without limitation, the Taxes of the Transferred Subs)
arising out of or pertaining to any period or partial period ending prior to or
on the Closing Date, except to the extent that such Taxes are otherwise resolved
by the Section 363/365 Order or, if applicable, the Confirmation Order" and (ii)
changing the cross references to "Section 3.11(a)" which now appear in Section
8.15 so that such references read "this Section 8.15."
19. Section 5.3(a) of the Acquisition Agreement is hereby amended to read
as follows:
(a) the Seller shall, and shall cause the Business Subs to, use
commercially reasonable efforts to conduct the Business only in the
ordinary course consistent with past practice provided that, in order to
ensure the orderly transfer as of the Closing of all of the Accounts
Receivable of the Business to the Purchaser and the Purchasing Subs, the
Seller, the Selling Subs, the Purchaser and the Purchasing Subs shall (both
prior to and after the Closing) take all of the actions with respect
thereto described in the separate memo which has been signed by both the
Purchaser and the Seller entitled "Methodology to Segregate CSD Payments."
20. Sections 6.1(a) and 6.2(c) of the Acquisition Agreement are hereby
amended to change the dates therein from "June 27, 2002" and "June 20, 2002,"
respectively, to "June 30, 2002."
21. Section 8.14 of the Acquisition Agreement is hereby amended to read as
follows: "The Purchaser and the Seller agree that no election under Section 338
of the Internal Revenue Code of 1986, as amended, shall be made in connection
with any transaction contemplated in this Agreement, except for any such
election which may properly be made by either the Purchaser or the Seller
without the consent of the other party and which will not have an adverse effect
upon such other party."
22. Section 8.16 of the Acquisition Agreement is hereby amended by adding
the words "or Section 8.15" to the second sentence thereof and adding the
following as the third sentence thereof: "All costs incurred by the Purchaser or
the Seller as a result of
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the exercise by the Seller of its right under this Section 8.16 shall be for the
account of the Seller and not the Purchaser."
Article IX of the Acquisition Agreement is hereby amended to (i) add a
definition of the term "Section 116 Certificate," (ii) delete the definitions of
"Escrow Agent" and "Escrow Agreement" and (iii) reduce the amount of the "Target
Working Capital" by $10,000,000.00, so that such definitions shall read as
follows:
"Section 116 Certificate" means a Certificate (as amended by any subsequent
amendments thereto) with Respect to the Proposed Disposition of Property by a
Non-Resident of Canada issued by the Canadian Minsister of National Revenue
pursuant to Section 116(4) of the Canadian Income Tax Act, with a Certificate
Limit fixed by the Minister of National Revenue in such Certificate.
"Target Working Capital" means Fifty-four Million, Two Hundred and Seventy
Thousand Dollars ($54,270,000).
23. Except as described in the preceding sections of this Amendment, the
Acquisition Agreement shall remain in full force and effect.
Remainder of page intentionally left blank.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
September 6, 2002.
SAFETY-KLEEN SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Sole Director
CLEAN HARBORS, INC.
By: /s/ Xxxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxxxx
Title: Senior Vice President
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