SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
December 18, 1995
WESTERN WASTE INDUSTRIES
(Exact name of registrant as specified in its charter)
California 0-11264 95-1946054
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
21061 South Western Avenue 90501
Torrance, California (Zip Code)
(Address of Principal
Executive Offices)
Registrant's Telephone Number, including area code: (310) 328-0900
Exhibit Index on Page 4
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Item 5. Other Information
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On December 18, 1995, the Registrant entered into an
Agreement and Plan of Merger with USA Waste Services, Inc., a
Delaware corporation ("USA Waste") and Riviera Acquisition
Corporation, a California corporation and wholly owned subsidiary of
USA Waste ("Riviera"), pursuant to which Riviera would merge with
and into Registrant and USA Waste would issue 1.5 shares of its
common stock, par value $.01 per share, for each share of
Registrant's common stock on the effective date of the merger. The
merger would result in the Registrant becoming a wholly owned
subsidiary of USA Waste. The merger would result in the issuance by
USA Waste of approximately 21,987,000 shares of its common stock to
shareholders of the Registrant. As of November 10, 1995, USA Waste
had 60,659,184 shares of its common stock outstanding. The merger
is subject to the approval of the shareholders of both Registrant
and USA Waste, both companies' lenders, appropriate assurances as to
the treatment of the merger as a tax-free reorganization accounted
for as a pooling of interest, expiration of the waiting period under
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and certain other conditions. It is expected that the merger will
be completed in approximately four months.
In connection with the proposed merger, USA Waste received
from Kosti Shirvanian, Chairman of the Board, President and Chief
Executive Officer of Registrant, an irrevocable proxy to vote his
4,516,413 shares of Registrant's common stock in favor of the merger
for a limited period of time and subject to certain conditions.
Mr. Shirvanian's shares represent approximately 31.0 percent of the
total outstanding shares of Registrant. Registrant also received
proxies from certain USA Waste shareholders authorizing Registrant
to vote such shares in favor of the merger, subject to limitations
similar to those contained in Mr. Shirvanian's proxy.
Item 7. Financial Statements and Exhibits
---------------------------------
Exhibit No. Description
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2 Agreement and Plan of Merger dated
as of December 18, 1995, by and among
USA Waste Services, Inc., Riviera
Acquisition Corporation and Western
Waste Industries
99 Joint Press Release issued
December 19, 1995 by USA Waste
Services, Inc. and Western Waste
Industries
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SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
Western Waste Industries
By /s/ Arnold J. Rothlisberger
--------------------------------
Arnold J. Rothlisberger
Vice President and
General Counsel
DATE: January 10, 1996
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EXHIBIT INDEX
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No. Description Page
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2 Agreement and Plan of Merger dated 5
as of December 18, 1995, by and among
USA Waste Services, Inc., Riviera
Acquisition Corporation and Western
Waste Industries
99 Joint Press Release issued 60
December 19, 1995 by USA Waste
Services, Inc. and Western Waste
Industries
Page 4 of 62 <PAGE>
EXHIBIT 2
AGREEMENT AND PLAN OF MERGER
Dated as of December 18, 1995
by and among
USA Waste Services, Inc.,
Riviera Acquisition Corporation
and
Western Waste Industries
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER, dated as of
December 18, 1995 (the "Agreement"), by and among USA Waste
Services, Inc., a Delaware corporation ("Parent"), Riviera
Acquisition Corporation, a California corporation and a wholly
owned subsidiary of Parent ("Subsidiary"), and Western Waste
Industries, a California corporation (the "Company');
WITNESSETH:
WHEREAS, the Boards of Directors of Parent, Subsidiary and
the Company have approved the merger of Subsidiary with and
into the Company on the terms set forth in the Agreement (the
"Merger"); and
WHEREAS, Parent, Subsidiary and the Company intend the
Merger to qualify as a tax-free reorganization under the
provisions of Section 368 of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations thereunder;
WHEREAS, in connection with the Merger and as an
inducement to the Company to enter into this Agreement, the
Company, Parent and certain shareholders of Parent have
executed as of the date hereof a voting agreement in favor of
the Company with respect to, among other things, the voting of
shares of capital stock of Parent held or to be held by them in
favor of the Merger; and
WHEREAS, in connection with the Merger and as an
inducement to Parent to enter into this Agreement, Parent, the
Company and a principal shareholder of the Company have
executed as of the date hereof a voting agreement in favor of
Parent with respect to, among other things, the voting of
shares of capital stock of the Company held or to be held by
such shareholder in favor of the Merger.
NOW, THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements contained
herein, the parties hereto, intending to be legally bound,
agree as follows:
ARTICLE I
THE MERGER
SECTION 1.1. THE MERGER. Upon the terms and subject to
the conditions of this Agreement, at the Effective Time (as
defined in Section 1.2) in accordance with the California
Corporations Code (the "CCC"), Subsidiary shall be merged with
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and into the Company and the separate existence of Subsidiary
shall thereupon cease. The Company shall be the surviving
corporation in the Merger and is hereinafter sometimes referred
to as the "Surviving Corporation."
SECTION 1.2. EFFECTIVE TIME OF THE MERGER. The Merger
shall become effective at such time (the "Effective Time") as
shall be stated in a certified copy of the Agreement, in a form
mutually acceptable to Parent and the Company, to be filed with
the Secretary of State of the State of California in accordance
with the CCC (the "Merger Filing"). The Merger Filing shall be
made simultaneously with or as soon as practicable after the
closing of the transactions contemplated by this Agreement in
accordance with Section 3.5. The parties acknowledge that it
is their mutual desire and intent to Consummate the Merger as
soon as practicable after the date hereof. Accordingly, the
parties shall use all reasonable efforts to consummate, as soon
as practicable, the transactions contemplated by this Agreement
in accordance with Section 3.5.
ARTICLE II
THE SURVIVING AND PARENT CORPORATIONS
SECTION 2.1. ARTICLES OF INCORPORATION. The Articles of
Incorporation of Subsidiary as in effect immediately prior to
the Effective Time shall be the Articles of Incorporation of
the Surviving Corporation after the Effective Time, and
thereafter may be amended in accordance with its terms and as
provided in the CCC.
SECTION 2.2. BY-LAWS. The By-laws of Subsidiary as in
effect immediately prior to the Effective Time shall be the
By-laws of the Surviving Corporation after the Effective Time,
and thereafter may be amended in accordance with their terms
and as provided by the Articles of Incorporation of the
Surviving Corporation and the CCC.
SECTION 2.3. DIRECTORS. The Board of Directors of Parent
shall take such corporate action as may be necessary to cause
Parent's Board of Directors immediately following the Effective
Time to be expanded to include three (3) members designated by
the Board of Directors of the Company, one of whom shall be
appointed by the Board of Directors of Parent to the Executive
Committee of the Board of Directors of Parent. The directors
of the Surviving Corporation shall be as designated in
Schedule 2.3, and such directors shall serve in accordance with
the By-laws of the Surviving Corporation until their respective
successors are duly elected or appointed and qualified.
SECTION 2.4. OFFICERS. The officers of the Surviving
Corporation shall be as designated in Schedule 2.4, and such
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officers shall serve in accordance with the By-laws of the
Surviving Corporation until their respective successors are
duly elected or appointed and qualified.
ARTICLE III
CONVERSION OF SHARES
SECTION 3.1. CONVERSION OF COMPANY SHARES IN THE MERGER.
At the Effective Time, by virtue of the Merger and without any
action on the part of any holder of any capital stock of the
Company:
(a) each share of the Company's Common Stock, no par
value (the "Company Common Stock"), shall, subject to
Sections 3.3 and 3.4, be converted into the right to
receive, without interest, 1.50 (the "Exchange Ratio")
shares of the common stock, par value $.01 per share, of
Parent ("Parent Common Stock");
(b) each share of capital stock of the Company, if
any, owned by Parent or any subsidiary of Parent or held
in treasury by the Company or any subsidiary of the
Company immediately prior to the Effective Time shall be
cancelled and shall cease to exist from and after the
Effective Time; and
(c) subject to and as more fully provided in
Section 7.9, each unexpired option to purchase Company
Common Stock that is outstanding at the Effective Time,
whether or not exercisable, shall automatically and
without any action on the part of the holder thereof be
converted into an option to purchase a number of shares of
Parent Common Stock equal to the number of shares of
Company Common Stock that could be purchased under such
option multiplied by the Exchange Ratio, at a price per
share of Parent Common Stock equal to the per share
exercise price of such option divided by the Exchange
Ratio.
SECTION 3.2. CONVERSION OF SUBSIDIARY SHARES. At the
Effective Time, by virtue of the Merger and without any action
on the part of Parent as the sole stockholder of Subsidiary,
each issued and outstanding share of common stock, par value
$.01 per share, of Subsidiary ("Subsidiary Common Stock") shall
be converted into one share of common stock, no par value, of
the Surviving Corporation.
SECTION 3.3. EXCHANGE OF CERTIFICATES. (a) From and after
the Effective Time, each holder of an outstanding certificate
which immediately prior to the Effective Time represented
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shares of Company Common Stock shall be entitled to receive in
exchange therefor, upon surrender thereof to an exchange agent
reasonably satisfactory to Parent and the Company (the
"Exchange Agent"), a certificate or certificates representing
the number of whole shares of Parent Common Stock to which such
holder is entitled pursuant to Section 3.1(a). Notwithstanding
any other provision of this Agreement, (i) until holders or
transferees of certificates theretofore representing shares of
Company Common Stock have surrendered them for exchange as
provided herein, no dividends shall be paid with respect to any
shares represented by such certificates and no payment for
fractional shares shall be made and (ii) without regard to when
such certificates representing shares of Company Common Stock
are surrendered for exchange as provided herein, no interest
shall be paid on any dividends or any payment for fractional
shares. Upon surrender of a certificate which immediately
prior to the Effective Time represented shares of Company
Common Stock, there shall be paid to the holder of such
certificate the amount of any dividends which theretofore
became payable, but which were not paid by reason of the
foregoing, with respect to the number of whole shares of Parent
Common Stock represented by the certificate or certificates
issued upon such surrender.
(b) If any certificate for shares of Parent Common Stock
is to be issued in a name other than that in which the
certificate for shares of Company Common Stock surrendered in
exchange therefor is registered, it shall be a condition of
such exchange that the person requesting such exchange shall
pay any applicable transfer or other taxes required by reason
of such issuance.
(c) Promptly after the Effective Time, Parent shall make
available to the Exchange Agent the certificates representing
shares of Parent Common Stock required to effect the exchanges
referred to in paragraph (a) above and cash for payment of any
fractional shares referred to in Section 3.4.
(d) Promptly after the Effective Time, the Exchange Agent
shall mail to each holder of record of a certificate or
certificates that immediately prior to the Effective Time
represented outstanding shares of Company Common Stock (the
"Company Certificates") (i) a letter of transmittal (which
shall specify that delivery shall be effected, and risk of loss
and title to the Company Certificates shall pass, only upon
actual delivery of the Company Certificates to the Exchange
Agent) and (ii) instructions for use in effecting the surrender
of the Company Certificates in exchange for certificates
representing shares of Parent Common Stock. Upon surrender of
Company Certificates for cancellation to the Exchange Agent,
together with a duly executed letter of transmittal and such
other documents as the Exchange Agent shall reasonably require,
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the holder of such Company Certificates shall be entitled to
receive in exchange therefor a certificate representing that
number of whole shares of Parent Common Stock into which the
shares of Company Common Stock theretofore represented by the
Company Certificates so surrendered shall have been converted
pursuant to the provisions of Section 3.1(a), and the Company
Certificates so surrendered shall be cancelled. Notwith-
standing the foregoing, neither the Exchange Agent nor any
party hereto shall be liable to a holder of shares of Company
Common Stock for any shares of Parent Common Stock or dividends
or distributions thereon delivered to a public official
pursuant to applicable abandoned property, escheat or similar
laws.
(e) Promptly following the date which is nine (9) months
after the Effective Date, the Exchange Agent shall deliver to
Parent all cash, certificates (including any Parent Common
Stock) and other documents in its possession relating to the
transactions described in this Agreement, and the Exchange
Agent's duties shall terminate. Thereafter, each holder of a
Company Certificate may surrender such Company Certificate to
the Surviving Corporation and (subject to applicable abandoned
property, escheat and similar laws) receive in exchange
therefor the Parent Common Stock, without any interest thereon.
Notwithstanding the foregoing, none of the Exchange Agent,
Parent, Subsidiary, the Company or the Surviving Corporation
shall be liable to a holder of Company Common Stock for any
Parent Common Stock delivered to a public official pursuant to
applicable abandoned property, escheat and similar laws.
(f) In the event any Company Certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit of
that fact by the person claiming such Company Certificate to be
lost, stolen or destroyed, the Surviving Corporation shall
issue in exchange for such lost, stolen or destroyed Company
Certificate the Parent Common Stock deliverable in respect
thereof determined in accordance with this Article III. When
authorizing such payment in exchange therefor, the Board of
Directors of the Surviving Corporation may, in its discretion
and as a condition precedent to the issuance thereof, require
the owner of such lost, stolen or destroyed Company Certificate
to give the Surviving Corporation such indemnity as it may
reasonably direct as protection against any claim that may be
made against the Surviving Corporation with respect to the
Company Certificate alleged to have been lost, stolen or
destroyed.
SECTION 3.4. NO FRACTIONAL SECURITIES. Notwithstanding
any other provision of this Agreement, no certificates or scrip
for fractional shares of Parent Common Stock shall be issued in
the Merger and no Parent Common Stock dividend, stock split or
interest shall relate to any fractional security, and such
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fractional interests shall not entitle the owner thereof to
vote or to any other rights of a security holder. In lieu of
any such fractional shares, each holder of Company Common Stock
who would otherwise have been entitled to receive a fraction of
a share of Parent Common Stock upon surrender of Company
Certificates for exchange pursuant to this Article III shall be
entitled to receive from the Exchange Agent a cash payment
equal to such fraction multiplied by the average closing price
per share of Parent Common Stock on the New York Stock
Exchange, as reported by the Wall Street Journal, during the
10 trading days immediately preceding the Effective Time.
SECTION 3.5. CLOSING. The closing (the "Closing") of the
transactions contemplated by this Agreement shall take place at
a location mutually agreeable to Parent and the Company on the
fifth business day immediately following the date on which the
last of the conditions set forth in Article VIII is fulfilled
or waived, or at such other time and place as Parent and the
Company shall agree (the date on which the Closing occurs is
referred to in this Agreement as the "Closing Date").
SECTION 3.6. CLOSING OF THE COMPANY'S TRANSFER BOOKS. At
and after the Effective Time, holders of Company Certificates
shall cease to have any rights as stockholders of the Company,
except for the right to receive shares of Parent Common Stock
pursuant to Section 3.1 and the right to receive cash for
payment of fractional shares pursuant to Section 3.4. At the
Effective Time, the stock transfer books of the Company shall
be closed and no transfer of shares of Company Common Stock
which were outstanding immediately prior to the Effective Time
shall thereafter be made. If, after the Effective Time,
subject to the terms and conditions of this Agreement, Company
Certificates formerly representing Company Common Stock are
presented to the Surviving Corporation, they shall be cancelled
and exchanged for Parent Common Stock in accordance with this
Article III.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF PARENT AND SUBSIDIARY
Parent and Subsidiary each represent and warrant to the
Company that, except as set forth in the Disclosure Schedule
dated as of the date hereof and signed by an authorized officer
of Parent (the "Disclosure Schedule"), each of which exceptions
shall specifically identify the relevant Section hereof to
which it relates:
SECTION 4.1. ORGANIZATION AND QUALIFICATION. Each of
Parent and Subsidiary is a corporation duly organized, validly
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existing and in good standing under the laws of the state of
its incorporation and has the requisite power and authority to
own, lease and operate its assets and properties and to carry
on its business as it is now being conducted. Each of Parent
and Subsidiary is qualified to do business and is in good
standing in each jurisdiction in which the properties owned,
leased or operated by it or the nature of the business
conducted by it makes such qualification necessary, except
where the failure to be so qualified and in good standing will
not, when taken together with all other such failures, have a
material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of Parent and its subsidiaries, taken as a whole.
True, accurate and complete copies of each of Parent's and
Subsidiary's charters and By-laws, in each case as in effect on
the date hereof, including all amendments thereto, have
heretofore been delivered to the Company.
SECTION 4.2. CAPITALIZATION. (a) The authorized capital
stock of Parent consists of (i) 150,000,000 shares of Parent
Common Stock, of which 60,659,184 shares were outstanding as of
November 10, 1995, and (ii) 10,000,000 shares of preferred
stock, par value $.01 per share, none of which was issued and
outstanding as of November 10, 1995. All of the issued and
outstanding shares of Parent Common Stock are validly issued
and are fully paid, nonassessable and free of preemptive
rights.
(b) The authorized capital stock of Subsidiary consists
of 1,000 shares of Subsidiary Common Stock, of which 100 shares
are issued and outstanding, which shares are owned beneficially
and of record by Parent.
(c) Except as disclosed in the Parent SEC Reports (as
defined in Section 4.5), as of the date hereof, there are no
outstanding subscriptions, options, calls, contracts,
commitments, understandings, restrictions, arrangements, rights
or warrants, including any right of conversion or exchange
under any outstanding security, instrument or other agreement
and also including any rights plan or other anti-takeover
agreement, obligating Parent or any subsidiary of Parent to
issue, deliver or sell, or cause to be issued, delivered or
sold, additional shares of the capital stock of Parent or
obligating Parent or any subsidiary of Parent to grant, extend
or enter into any such agreement or commitment. There are no
voting trusts, proxies or other agreements or understandings to
which Parent or any subsidiary of Parent is a party or is bound
with respect to the voting of any shares of capital stock of
Parent other than voting agreements executed in connection with
this Agreement. The shares of Parent Common Stock issued to
stockholders of the Company in the Merger will be at the
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Effective Time duly authorized, validly issued, fully paid and
nonassessable and free of preemptive rights.
SECTION 4.3. SUBSIDIARIES. Each direct and indirect
corporate subsidiary of Parent is duly organized, validly
existing and in good standing under the laws of its
jurisdiction of incorporation and has the requisite power and
authority to own, lease and operate its assets and properties
and to carry on its business as it is now being conducted.
Each subsidiary of Parent is qualified to do business, and is
in good standing, in each jurisdiction in which the properties
owned, leased or operated by it or the nature of the business
conducted by it makes such qualification necessary, except
where the failure to be so qualified and in good standing would
not, when taken together with all such other failures, have a
material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of Parent and its subsidiaries, taken as a whole.
All of the outstanding shares of capital stock of each
corporate subsidiary of Parent are validly issued, fully paid,
nonassessable and free of preemptive rights, and are owned
directly or indirectly by Parent, free and clear of any liens,
claims or encumbrances except that such shares are pledged to
secure Parent's credit facilities. There are no subscriptions,
options, warrants, rights, calls, contracts, voting trusts,
proxies or other commitments, understandings, restrictions or
arrangements relating to the issuance, sale, voting, transfer,
ownership or other rights with respect to any shares of capital
stock of any corporate subsidiary of Parent, including any
right of conversion or exchange under any outstanding security,
instrument or agreement. As used in this Agreement, the term
"subsidiary" shall mean, when used with reference to any person
or entity, any corporation, partnership, joint venture or other
entity of which such person or entity (either acting alone or
together with its other subsidiaries) owns, directly or
indirectly, 50% or more of the stock or other voting interests,
the holders of which are entitled to vote for the election of a
majority of the board of directors or any similar governing
body of such corporation, partnership, joint venture or other
entity.
SECTION 4.4. AUTHORITY; NON-CONTRAVENTION; APPROVALS.
(a) Parent and Subsidiary each have full corporate power and
authority to enter into this Agreement and, subject to the
Parent Stockholders' Approval (as defined in Section 7.3(b))
and the Parent Required Statutory Approvals (as defined in
Section 4.4(c)), to consummate the transactions contemplated
hereby. This Agreement has been approved by the Boards of
Directors of Parent and Subsidiary, and no other corporate
proceedings on the part of Parent or Subsidiary are necessary
to authorize the execution and delivery of this Agreement or,
except for the Parent Stockholders' Approval, the consummation
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by Parent and Subsidiary of the transactions contemplated
hereby. This Agreement has been duly executed and delivered by
each of Parent and Subsidiary, and, assuming the due
authorization, execution and delivery hereof by the Company,
constitutes a valid and legally binding agreement of each of
Parent and Subsidiary enforceable against each of them in
accordance with its terms, except that such enforcement may be
subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to
enforcement of creditors' rights generally and (ii) general
equitable principles. Without limitation of the foregoing,
each of the covenants and obligations of Parent set forth in
Sections 6.2, 6.5, 7.1, 7.2, 7.3, 7.6, 7.7, 7.8, 7.10 and 7.12
is valid, legally binding and enforceable notwithstanding the
absence of the Parent Stockholders' Approval.
(b) The execution and delivery of this Agreement by each
of Parent and Subsidiary do not violate, conflict with or
result in a breach of any provision of, or constitute a default
(or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of,
or accelerate the performance required by, or result in a right
of termination or acceleration under, or result in the creation
of any lien, security interest, charge or encumbrance upon any
of the properties or assets of Parent or any of its
subsidiaries under any of the terms, conditions or provisions
of (i) the respective charters or by-laws of Parent or any of
its subsidiaries, (ii) any statute, law, ordinance, rule,
regulation, judgment, decree, order, injunction, writ, permit
or license of any court or governmental authority applicable to
Parent or any of its subsidiaries or any of their respective
properties or assets or (iii) any note, bond, mortgage,
indenture, deed of trust, license, franchise, permit,
concession, contract, lease or other instrument, obligation or
agreement of any kind to which Parent or any of its
subsidiaries is now a party or by which Parent or any of its
subsidiaries or any of their respective properties or assets
may be bound or affected. The consummation by Parent and
Subsidiary of the transactions contemplated hereby will not
result in any violation, conflict, breach, termination,
acceleration or creation of liens under any of the terms,
conditions or provisions described in clauses (i) through (iii)
of the preceding sentence, subject (x) in the case of the
terms, conditions or provisions described in clause (ii) above,
to obtaining (prior to the Effective Time) the Parent Required
Statutory Approvals and the Parent Stockholder's Approval and
(y) in the case of the terms, conditions or provisions
described in clause (iii) above,, to obtaining (prior to the
Effective Time) consents required from commercial lenders,
lessors or other third parties. Excluded from the foregoing
sentences of this paragraph (b), insofar as they apply to the
terms, conditions or provisions described in clauses (ii) and
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(iii) of the first sentence of this paragraph (b), are such
violations, conflicts, breaches, defaults, terminations,
accelerations or creations of liens, security interests,
charges or encumbrances that would not, in the aggregate, have
a material adverse effect on the business, operations,
properties, assets, condition (financial or other) results of
operations or prospects of Parent and its subsidiaries, taken
as a whole.
(c) Except for (i) the filings by Parent and the Company
required by the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR Act"), (ii) the filing of the Joint
Proxy Statement/Prospectus (as defined in Section 4.9) with the
Securities and Exchange Commission (the "SEC") pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the Securities Act of 1933, as amended (the
"Securities Act), and the declaration of the effectiveness
thereof by the SEC and filings with various state blue sky
authorities, (iii) the making of the Merger Filing with the
Secretary of State of the State of California in connection
with the Merger, and (iv) any required filings with or
approvals from applicable state environmental authorities,
public service commissions and public utility commissions (the
filings and approvals referred to in clauses (i) through (iv)
are collectively referred to as the "Parent Required Statutory
Approvals"), no declaration, filing or registration with, or
notice to, or authorization, consent or approval of, any
governmental or regulatory body or authority is necessary for
the execution and delivery of this Agreement by Parent or
Subsidiary or the consummation by Parent or Subsidiary of the
transactions contemplated hereby, other than such declarations,
filings, registrations, notices, authorizations, consents or
approvals which, if not made or obtained, as the case may be,
would not, in the aggregate, have a material adverse effect on
the business, operations, properties, assets, condition
(financial or other) or results of operations of Parent and its
subsidiaries, taken as a whole.
SECTION 4.5. REPORTS AND FINANCIAL STATEMENTS. Since
January 1, 1993, Parent has filed with the SEC all forms,
statements, reports and documents (including all exhibits,
amendments and supplements thereto) required to be filed by it
under each of the Securities Act, the Exchange Act and the
respective rules and regulations thereunder, all of which, as
amended if applicable, complied in all material respects with
all applicable requirements of the appropriate act and the
rules and regulations thereunder. Parent has previously
delivered to the Company copies of its (a) Annual Reports on
Form 10-K for the fiscal year ended December 31, 1994 and for
each of the two immediately preceding fiscal years, as filed
with the SEC, (b) proxy and information statements relating to
(i) all meetings of its stockholders (whether annual or
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special) and (ii) actions by written consent in lieu of a
stockholders' meeting from January 1, 1993, until the date
hereof, and (c) all other reports, including quarterly reports,
or registration statements filed by Parent with the SEC since
January 1, 1993 (other than Registration Statements filed on
Form S-8) (collectively, the "Parent SEC Reports). As of their
respective dates, the Parent SEC Reports did not contain any
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, in light of the circumstances under which
they were made, not misleading. The audited consolidated
financial statements and unaudited interim consolidated
financial statements of Parent included in such reports
(collectively, the "Parent Financial Statements") have been
prepared in accordance with generally accepted accounting
principles applied on a consistent basis (except as may be
indicated therein or in the notes thereto) and fairly present
the financial position of Parent and its subsidiaries as of the
dates thereof and the results of their operations and changes
in financial position for the periods then ended, subject, in
the case of the unaudited interim financial statements, to
normal year-end and audit adjustments and any other adjustments
described therein.
SECTION 4.6. ABSENCE OF UNDISCLOSED LIABILITIES. Except
as disclosed in the Parent SEC Reports or with respect to
acquisitions or potential transactions or commitments
heretofore disclosed to the Company in writing, neither Parent
nor any of its subsidiaries had at September 30, 1995, or has
incurred since that date, any liabilities or obligations
(whether absolute, accrued, contingent or otherwise) of any
nature, except: (a) liabilities, obligations or contingencies
(i) which are accrued or reserved against in the Parent
Financial Statements or reflected in the notes thereto or
(ii) which were incurred after September 30, 1995, and were
incurred in the ordinary course of business and consistent with
past practices; (b) liabilities, obligations or contingencies
which (i) would not, in the aggregate, have a material adverse
effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of
Parent and its subsidiaries, taken as a whole, or (ii) have
been discharged or paid in full prior to the date hereof, and
(c) liabilities and obligations which are of a nature not
required to be reflected in the consolidated financial
statements of Parent and its subsidiaries prepared in
accordance with generally accepted accounting principles
consistently applied and which were incurred in the ordinary
course of business.
SECTION 4.7. ABSENCE OF CERTAIN CHANGES OR EVENTS. Since
the date of the most recent Parent SEC Report, there has not
been any material adverse change in the business, operations,
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properties, assets, liabilities, condition (financial or other)
or results of operations of Parent and its subsidiaries, taken
as a whole.
SECTION 4.8. LITIGATION. Except as disclosed in the
Parent SEC Reports, there are no claims, suits, actions or
proceedings pending or, to the knowledge of Parent, threatened
against, relating to or affecting Parent or any of its
subsidiaries, before any court, governmental department,
commission, agency, instrumentality or authority, or any
arbitrator that seek to restrain or enjoin the consummation of
the Merger or which could reasonably be expected, either alone
or in the aggregate with all such claims, actions or
proceedings, to materially and adversely affect the business,
operations, properties, assets, condition (financial or other)
or results of operations of Parent and its subsidiaries, taken
as a whole. Except as set forth in the Parent SEC Reports,
neither Parent nor any of its subsidiaries is subject to any
judgment, decree, injunction, rule or order of any court,
governmental department, commission, agency, instrumentality or
authority or any arbitrator which prohibits or restricts the
consummation of the transactions contemplated hereby or would
have any material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of Parent and its subsidiaries, taken as a whole.
SECTION 4.9. REGISTRATION STATEMENT AND PROXY STATEMENT.
None of the information to be supplied by Parent or its
subsidiaries for inclusion in (a) the Registration Statement on
Form S-4 to be filed under the Securities Act with the SEC by
Parent in connection with the Merger for the purpose of
registering the shares of Parent Common Stock to be issued in
the Merger (the "Registration Statement") or (b) the proxy
statement to be distributed in connection with the Company's
and Parent's meetings of their respective stockholders to vote
upon this Agreement and the transactions contemplated hereby
(the "Proxy Statement" and, together with the prospectus
included in the Registration Statement, the "Joint Proxy
Statement/Prospectus") will, in the case of the Proxy Statement
or any amendments thereof or supplements thereto, at the time
of the mailing of the Proxy Statement and any amendments or
supplements thereto, and at the time of the meetings of
stockholders of the Company and Parent to be held in connection
with the transactions contemplated by this Agreement, or, in
the case of the Registration Statement, as amended or
supplemented, at the time it becomes effective and at the time
of such meetings of the stockholders of the Company and Parent,
contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading.
The Joint Proxy Statement/Prospectus will, as of its mailing
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date, comply as to form in all material respects with all
applicable laws, including the provisions of the Securities Act
and the Exchange Act and the rules and regulations promulgated
thereunder, except that no representation is made by Parent or
Subsidiary with respect to information supplied by the Company
or the stockholders of the Company for inclusion therein.
SECTION 4.10. NO VIOLATION OF LAW. Except as disclosed
in the Parent SEC Reports, neither Parent nor any of its
subsidiaries is in violation of, or has been given notice or
been charged with any violation of, any law, statute, order,
rule, regulation, ordinance, or judgment (including, without
limitation, any applicable environmental law, ordinance or
regulation) of any governmental or regulatory body or
authority, except for violations which, in the aggregate, could
not reasonably be expected to have a material adverse effect on
the business, operations, properties, assets, condition
(financial or other) or results of operations of Parent and its
subsidiaries, taken as a whole. Except as disclosed in the
Parent SEC Reports, as of the date of this Agreement, to the
knowledge of Parent, no investigation or review by any
governmental or regulatory body or authority is pending or
threatened, nor has any governmental or regulatory body or
authority indicated an intention to conduct the same, other
than, in each case, those the outcome of which, as far as
reasonably can be foreseen, will not have a material adverse
effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Parent and its subsidiaries, taken as a whole. Parent and its
subsidiaries have all permits, licenses, franchises, variances,
exemptions, orders and other governmental authorizations,
consents and approvals necessary to conduct their businesses as
presently conducted (collectively, the "Parent Permits"),
except for permits, licenses, franchises, variances,
exemptions, orders, authorizations, consents and approvals the
absence of which, alone or in the aggregate, would not have a
material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of the Parent and its subsidiaries, taken as a
whole. Parent and its subsidiaries are not in violation of the
terms of any Parent Permit, except for delays in filing reports
or violations which, alone or in the aggregate, would not have
a material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of the Parent and its subsidiaries, taken as a
whole.
SECTION 4.11. COMPLIANCE WITH AGREEMENTS. Except as
disclosed in the Parent SEC Reports, Parent and each of its
subsidiaries are not in breach or violation of or in default in
the performance or observance of any term or provision of, and
no event has occurred which, with lapse of time or action by a
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third party, could result in a default under (a) the respective
charters, by-laws or other similar organizational instruments
of Parent or any of its subsidiaries or (b) any contract,
commitment, agreement, indenture, mortgage, loan agreement,
note, lease, bond, license, approval or other instrument to
which Parent or any of its subsidiaries is a party or by which
any of them is bound or to which any of their property is
subject, which breaches, violations and defaults, in the case
of clause (b) of this Section 4.11, would have, in the
aggregate, a material adverse effect on the business,
operations, properties, assets, condition (financial or other)
or results of operations of Parent and its subsidiaries, taken
as a whole.
SECTION 4.12. TAXES. (a) Parent and its subsidiaries
have (i) duly filed with the appropriate governmental
authorities all Tax Returns (as defined in Section 4.12(c))
required to be filed by them for all periods ending on or prior
to the Effective Time, other than those Tax Returns the failure
of which to file would not have a material adverse effect on
the business, operations, properties, assets, condition
(financial or other) or results of operations of Parent and its
subsidiaries, taken as a whole, and such Tax Returns are true,
correct and complete in all material respects and (ii) duly
paid in full or made adequate provision for the payment of all
Taxes (as defined in Section 4.12(b)) for all periods ending at
or prior to the Effective Time. The liabilities and reserves
for Taxes reflected in the Parent balance sheet included in the
latest Parent SEC Report are adequate to cover all Taxes for
all periods ending at or prior to the Effective Time and there
are no material liens for Taxes upon any property or assets of
Parent or any subsidiary thereof, except for liens for Taxes
not yet due. There are no unresolved issues of law or fact
arising out of a notice of deficiency, proposed deficiency or
assessment from the Internal Revenue Service (the "IRS") or any
other governmental taxing authority with respect to Taxes of
the Parent or any of its subsidiaries which, if decided
adversely, singly or in the aggregate, would have a material
adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of
Parent and its subsidiaries, taken as a whole. Neither Parent
nor any of its subsidiaries is a party to any agreement
providing for the allocation or sharing of Taxes with any
entity that is not, directly or indirectly, a wholly-owned
corporate subsidiary of Parent other than agreements the
consequences of which are fully and adequately reserved for in
the Parent Financial Statements. Neither Parent nor any of its
corporate subsidiaries has, with regard to any assets or
property held, acquired or to be acquired by any of them, filed
a consent to the application of Section 341(f) of the Code.
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(b) For purposes of this Agreement, the term "Taxes"
shall mean all taxes, including, without limitation, income,
gross receipts, excise, property, sales, withholding, social
security, occupation, use, service, service use, license,
payroll, franchise, transfer and recording taxes, fees and
charges, windfall profits, severance, customs, import, export,
employment or similar taxes, charges, fees, levies or other
assessments imposed by the United States, or any state, local
or foreign government or subdivision or agency thereof, whether
computed on a separate, consolidated, unitary, combined or any
other basis, and such term shall include any interest, fines,
penalties or additional amounts and any interest in respect of
any additions, fines or penalties attributable or imposed or
with respect to any such taxes, charges, fees, levies or other
assessments.
(c) For purposes of this Agreement, the term "Tax Return"
shall mean any return, report or other document or information
required to be supplied to a taxing authority in connection
with Taxes.
SECTION 4.13. EMPLOYEE BENEFIT PLANS; ERISA. (a) Except
as set forth in the Parent SEC Reports, at the date hereof,
Parent and its subsidiaries do not maintain or contribute to
any material employee benefit plans, programs, arrangements or
practices (such plans, programs, arrangements or practices of
Parent and its subsidiaries being referred to as the "Parent
Plans"), including employee benefit plans within the meaning
set forth in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or other similar
material arrangements for the provision of benefits (excluding
any "Multiemployer Plan" within the meaning of Section 3(37) of
ERISA or a "Multiple Employer Plan" within the meaning of
Section 413(c) of the Code). The Parent Disclosure Schedule
lists all Multi-employer Plans and Multiple Employer Plans
which any of Parent or its subsidiaries maintains or to which
any of them makes contributions. Neither Parent nor its
subsidiaries has any obligation to create any additional such
plan or to amend any such plan so as to increase benefits
thereunder, except as required under the terms of the Parent
Plans, under existing collective bargaining agreements or to
comply with applicable law.
(b) Except as disclosed in the Parent SEC Reports,
(i) there have been no prohibited transactions within the
meaning of Section 406 or 407 of ERISA or Section 4975 of the
Code with respect to any of the Parent Plans that could result
in penalties, taxes or liabilities which, singly or in the
aggregate, could have a material adverse effect on the
business, operations, properties, assets, condition (financial
or other) or results of operations of Parent and its sub-
sidiaries, taken as a whole, (ii) except for premiums due,
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there is no outstanding material liability, whether measured
alone or in the aggregate, under Title IV of ERISA with respect
to any of the Parent Plans, (iii) neither the Pension Benefit
Guaranty Corporation nor any plan administrator has instituted
proceedings to terminate any of the Parent Plans subject to
Title IV of ERISA other than in a "standard termination"
described in Section 4041(b) of ERISA, (iv) none of the Parent
Plans has incurred any "accumulated funding deficiency" (as
defined in Section 302 of ERISA and Section 412 of the Code),
whether or not waived, as of the last day of the most recent
fiscal year of each of the Parent Plans ended prior to the date
of this Agreement, (v) the current present value of all
projected benefit obligations under each of the Parent Plans
which is subject to Title IV of ERISA did not, as of its latest
valuation date, exceed the then current value of the assets of
such plan allocable to such benefit liabilities by more than
the amount, if any, disclosed in the Parent SEC Reports as of
June 30, 1995, based upon reasonable actuarial assumptions
currently utilized for such Parent Plan, (vi) each of the
Parent Plans has been operated and administered in all material
respects in accordance with applicable laws during the period
of time covered by the applicable statute of limitations, (vii)
each of the Parent Plans which is intended to be "qualified"
within the meaning of Section 401(a) of the Code has been
determined by the Internal Revenue Service to be so qualified
and such determination has not been modified, revoked or
limited by failure to satisfy any condition thereof or by a
subsequent amendment thereto or a failure to amend, except that
it may be necessary to make additional amendments retroactively
to maintain the "qualified" status of such Parent Plans, and
the period for making any such necessary retroactive amendments
has not expired, (viii) with respect to Multiemployer Plans,
neither Parent nor any of its subsidiaries has made or suffered
a "complete withdrawal" or a "partial withdrawal," as such
terms are respectively defined in Sections 4203, 4204 and 4205
of ERISA and, to the best knowledge of Parent and its sub-
sidiaries, no event has occurred or is expected to occur which
presents a material risk of a complete or partial withdrawal
under said Sections 4203, 4204 and 4205, (ix) to the best
knowledge of Parent and its subsidiaries, there are no material
pending, threatened or anticipated claims involving any of the
Parent Plans other than claims for benefits in the ordinary
course, and (x) Parent and its subsidiaries have no current
material liability for plan termination or withdrawal (complete
or partial) under Title IV of ERISA based on any plan to which
any entity that would be deemed one employer with Parent and
its subsidiaries under Section 4001 of ERISA or Section 414 of
the Code contributed during the period of time covered by the
applicable statute of limitations (a "Parent Controlled Group
Plan"), and Parent and its subsidiaries do not reasonably
anticipate that any such liability will be asserted against
Parent or any of its subsidiaries. None of the Parent
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Controlled Group Plans has an "accumulated funding deficiency"
(as defined in Section 302 of ERISA and Section 412 of the
Code).
(c) The Parent SEC Reports contain a true and complete
summary or list of or otherwise describe all material
employment contracts and other employee benefit arrangements
with "change of control" or similar provisions and all
severance agreements with executive officers.
SECTION 4.14. LABOR CONTROVERSIES. Except as set forth
in the Parent SEC Reports, (a) there are no significant
controversies pending or, to the knowledge of Parent,
threatened between Parent or its subsidiaries and any
representatives of any of their employees and (b) to the
knowledge of Parent, there are no material organizational
efforts presently being made involving any of the presently
unorganized employees of Parent and its subsidiaries except for
such controversies and organizational efforts which, singly or
in the aggregate, could not reasonably be expected to
materially and adversely affect the business, operations,
properties, assets, condition (financial or other) or results
of operations of Parent and its subsidiaries, taken as a whole.
SECTION 4.15. ENVIRONMENTAL MATTERS. (a) Except as set
forth in the Parent SEC Reports, (i) Parent and its subsidi-
aries have conducted their respective businesses in compliance
with all applicable Environmental Laws, including, without
limitation, having all permits, licenses and other approvals
and authorizations necessary for the operation of their
respective businesses as presently conducted, (ii) none of the
properties owned by Parent or any of its subsidiaries contain
any Hazardous Substance as a result of any activity of Parent
or any of its subsidiaries in amounts exceeding the levels
permitted by applicable Environmental Laws, (iii) neither
Parent nor any of its subsidiaries has received any notices,
demand letters or requests for information from any Federal,
state, local or foreign governmental entity or third party
indicating that Parent or any of its subsidiaries may be in
violation of, or liable under, any Environmental Law in
connection with the ownership or operation of their businesses,
(iv) there are no civil, criminal or administrative actions,
suits, demands, claims, hearings, investigations or proceedings
pending or threatened, against Parent or any of its
subsidiaries relating to any violation, or alleged violation,
of any Environmental Law, (v) no reports have been filed, or
are required to be filed, by Parent or any of its subsidiaries
concerning the release of any Hazardous Substance or the
threatened or actual violation of any Environmental Law,
(vi) no Hazardous Substance has been disposed of, released or
transported in violation of any applicable Environmental Law
from any properties owned by Parent or any of its subsidiaries
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as a result of any activity of parent or any of its subsidi-
aries during the time such properties were owned, leased or
operated by Parent or any of its subsidiaries, (vii) there have
been no environmental investigations, studies, audits, tests,
reviews or other analyses regarding compliance or noncompliance
with any applicable Environmental Law conducted by or which are
in the possession of Parent or its subsidiaries relating to the
activities of Parent or its subsidiaries which have not been
delivered to Parent prior to the date hereof, (viii) there are
no underground storage tanks on, in or under any properties
owned by Parent or any of its subsidiaries and no underground
storage tanks have been closed or removed from any of such
properties during the time such properties were owned, leased
or operated by Parent or any of its subsidiaries, (ix) there is
no asbestos or asbestos containing material present in any of
the properties owned by Parent and its subsidiaries, and no
asbestos has been removed from any of such properties during
the time such properties were owned, leased or operated by
Parent or any of its subsidiaries, and (x) neither Parent, its
subsidiaries nor any of their respective properties are subject
to any material liabilities or expenditures (fixed or
contingent) relating to any suit, settlement, court order,
administrative order, regulatory requirement, judgment or claim
asserted or arising under any Environmental Law, except for
violations of the foregoing clauses (i) through (x) that,
singly or in the aggregate, would not reasonably be expected to
have a material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of Parent and its subsidiaries considered as one
enterprise.
(b) As used herein, "Environmental Law" means any
Federal, state, local or foreign law, statute, ordinance, rule,
regulation, code, license, permit, authorization, approval,
consent, legal doctrine, order, judgment, decree, injunction,
requirement or agreement with any governmental entity relating
to (x) the protection, preservation or restoration of the
environment (including, without limitation, air, water vapor,
surface water, groundwater, drinking water supply, surface
land, subsurface land, plant and animal life or any other
natural resource) or to human health or safety or (y) the
exposure to, or the use, storage, recycling, treatment,
generation, transportation, processing, handling, labeling,
production, release or disposal of Hazardous Substances, in
each case as amended and as in effect on the Closing Date. The
term "Environmental Law" includes, without limitation, (i) the
Federal Comprehensive Environmental Response Compensation and
Liability Act of 1980, the Superfund Amendments and
Reauthorization Act, the Federal Water Pollution Control Act of
1972, the Federal Clean Air Act, the Federal Clean Water Act,
the Federal Resource Conservation and Recovery Act of 1976
(including the Hazardous and Solid Waste Amendments thereto),
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the Federal Solid Waste Disposal Act and the Federal Toxic
Substances Control Act the Federal Insecticide, Fungicide and
Rodenticide Act, and the Federal Occupational Safety and Health
Act of 1970, each as amended and as in effect on the Closing
Date, and (ii) any common law or equitable doctrine (including,
without limitation, injunctive relief and tort doctrines such
as negligence, nuisance, trespass and strict liability) that
may impose liability or obligations for injuries or damages due
to, or threatened as a result of, the presence of, effects of
or exposure to any Hazardous Substance.
(c) As used herein, "Hazardous Substance" means any
substance presently or hereafter listed, defined, designated or
classified as hazardous, toxic, radioactive, or dangerous, or
otherwise regulated, under any Environmental Law. Hazardous
Substance includes any substance to which exposure is regulated
by any government authority or any Environmental Law including,
without limitation, any toxic waste, pollutant, contaminant,
hazardous substance, toxic substance, hazardous waste, special
waste, industrial substance or petroleum or any derivative or
by-product thereof, radon, radioactive material, asbestos, or
asbestos containing material, urea formaldehyde foam
insulation, lead or polychlorinated biphenyls.
SECTION 4.16. NON-COMPETITION AGREEMENTS. Neither Parent
nor any subsidiary of Parent is a party to any agreement which
purports to restrict or prohibit in any material respect any of
them from, directly or indirectly, engaging in any business
involving the collection, interim storage, transfer, recovery,
processing, recycling, marketing or disposal of rubbish,
garbage, paper, textile wastes, chemical or hazardous wastes,
liquid and other wastes or any other material business
currently engaged in by the Parent or the Company, or any
corporations affiliated with either of them. None of Parent's
officers, directors or key employees is a party to any
agreement which, by virtue of such person's relationship with
Parent, restricts in any material respect Parent or any
subsidiary of Parent from, directly or indirectly, engaging in
any of the businesses described above.
SECTION 4.17. TITLE TO ASSETS. Parent and each of its
subsidiaries has good and marketable title in fee simple to all
its real property and good title to all its leasehold interests
and other properties and assets that have been disposed of in
the ordinary course of business since the date of such balance
sheet, free and clear of all mortgages, liens, pledges, charges
or encumbrances of any nature whatsoever, except (i) the lien
for current taxes, payments of which are not yet delinquent,
(ii) such imperfections in title and easements and
encumbrances, if any, as are not substantial in character,
amount or extent and do not materially detract from the value
or interfere with the present use of the property subject
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thereto or affected thereby, or otherwise materially impair the
Parent's business operations (in the manner presently carried
on by the Parent), or (iii) as disclosed in the Parent SEC
Reports, and except for such matters which, singly or in the
aggregate, could not reasonably be expected to materially and
adversely affect the business, operations, properties, assets,
condition (financial or other) or results of operations of
Parent and its subsidiaries, taken as a whole. All leases
under which Parent leases any real or personal property are in
good standing, valid and effective in accordance with their
respective terms, and there is not, under any of such leases,
any existing default or event which with notice or lapse of
time or both would become a default other than defaults under
such leases which in the aggregate will not materially and
adversely affect the Parent and its subsidiaries, taken as a
whole.
SECTION 4.18. POOLING OF INTERESTS. None of the Parent,
Subsidiary or, to their knowledge, any of their affiliates has
taken or agreed to take any action that would prevent the
Merger from (a) constituting a reorganization qualifying under
the provisions of Section 368(a) of the Code or (b) being
treated for financial accounting purposes as a "pooling of
interests" in accordance with generally accepted accounting
principles and the rules, regulations and interpretations of
the SEC (a "Pooling Transaction").
SECTION 4.19. PARENT STOCKHOLDERS' APPROVAL. The
affirmative vote of stockholders of Parent required for
approval and adoption of this Agreement and the Merger is a
majority of the shares of Parent Common Stock present in person
or by proxy at a meeting of such stockholders and entitled to
vote thereat.
SECTION 4.20. BROKERS AND FINDERS. Except for the fees
and expenses payable to Donaldson, Lufkin & Jenrette Securities
Corporation ("DLJ"), which fees are reflected in its agreement
with Parent (a copy of which has been delivered to the
Company), Parent has not entered into any contract, arrangement
or understanding with any person or firm which may result in
the obligation of Parent to pay any finder's fees, brokerage or
agent commissions or other like payments in connection with the
transactions contemplated hereby. Except for the fees and
expenses paid or payable to DLJ, there is no claim for payment
by Parent of any investment banking fees, finder's fees,
brokerage or agent commissions or other like payments in
connection with the negotiations leading to this Agreement or
the consummation of the transactions contemplated hereby.
Section 4.21. OPINION OF FINANCIAL ADVISOR. The
financial advisor of Parent, DLJ, has rendered a written
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opinion to Parent to the effect that the Exchange Ratio is fair
from a financial point of view to the Parent.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Parent and
Subsidiary that, except as set forth in the disclosure schedule
dated as of the date hereof and signed by an authorized officer
of the Company (the "Company Disclosure Schedule"), each of
which exceptions shall specifically identify the relevant
Section hereof to which it relates:
SECTION 5.1. ORGANIZATION AND QUALIFICATION. The Company
is a corporation duly organized, validly existing and in good
standing under the laws of the State of California and has the
requisite corporate power and authority to own, lease and
operate its assets and properties and to carry on its business
as it is now being conducted. The Company is qualified to do
business and is in good standing in each jurisdiction in which
the properties owned, leased or operated by it or the nature of
the business conducted by it makes such qualification
necessary, except where the failure to be so qualified and in
good standing will not, when taken together with all other such
failures, have a material adverse effect on the business,
operations, properties, assets, condition (financial or other)
or results of operations of the Company and its subsidiaries,
taken as a whole. True, accurate and complete copies of the
Company's Articles of Incorporation and By-laws, in each case
as in effect on the date hereof, including all amendments
thereto, have heretofore been delivered to Parent.
SECTION 5.2. CAPITALIZATION. (a) The authorized capital
stock of the Company consists of 50,000,000 shares of Company
Common Stock and 2,000,000 shares of preferred stock. As of
October 31, 1995, 14,658,301 shares of Company Common Stock and
no shares of preferred stock were issued and outstanding. All
of such issued and outstanding shares are validly issued and
are fully paid, nonassessable and free of preemptive rights.
No subsidiary of the Company holds any shares of the capital
stock of the Company.
(b) Except as disclosed in the Company SEC Reports, as of
the date hereof there were no outstanding subscriptions,
options, calls, contracts, commitments, understandings,
restrictions, arrangements, rights or warrants, including any
right of conversion or exchange under any outstanding security,
instrument or other agreement and also including any rights
plan or other anti-takeover agreement, obligating the Company
or any subsidiary of the Company to issue, deliver or sell, or
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cause to be issued, delivered or sold, additional shares of the
capital stock of the Company or obligating the Company or any
subsidiary of the Company to grant, extend or enter into any
such agreement or commitment. There are no voting trusts,
proxies or other agreements or understandings to which the
Company or any subsidiary of the Company is a party or is bound
with respect to the voting of any shares of capital stock of
the Company other than voting agreements executed in connection
with this Agreement.
SECTION 5.3. SUBSIDIARIES. Each direct and indirect
corporate subsidiary of the Company is duly organized, validly
existing and in good standing under the laws of its juris-
diction of incorporation and has the requisite power and
authority to own, lease and operate its assets and properties
and to carry on its business as it is now being conducted.
Each subsidiary of the Company is qualified to do business, and
is in good standing, in each jurisdiction in which the
properties owned, leased or operated by it or the nature of the
business conducted by it makes such qualification necessary,
except where the failure to be so qualified and in good
standing will not, when taken together with all such other
failures, have a material adverse effect on the business,
operations, properties, assets, condition (financial or other)
or results of operations of the Company and its subsidiaries,
taken as a whole. All of the outstanding shares of capital
stock of each corporate subsidiary of the Company are validly
issued, fully paid, nonassessable and free of preemptive rights
and are owned directly or indirectly by the Company free and
clear of any liens, claims, encumbrances, security interests,
equities, charges and options of any nature whatsoever. There
are no subscriptions, options, warrants, rights, calls,
contracts, voting trusts, proxies or other commitments,
understandings, restrictions or arrangements relating to the
issuance, sale, voting, transfer, ownership or other rights
with respect to any shares of capital stock of any corporate
subsidiary of the Company, including any right of conversion or
exchange under any outstanding security, instrument or
agreement.
SECTION 5.4. AUTHORITY; NON-CONTRAVENTION; APPROVALS.
(a) The Company has full corporate power and authority to enter
into this Agreement and, subject to the Company Stockholders'
Approval (as defined in Section 7.3(a)) and die Company
Required Statutory Approvals (as defined in Section 5.4(c)), to
consummate the transactions contemplated hereby. This
Agreement has been approved by the Board of Directors of the
Company, and no other corporate proceedings on the part of the
Company are necessary to authorize the execution and delivery
of this Agreement or, except for the Company Stockholders'
Approval, the consummation by the Company of the transactions
contemplated hereby. This Agreement has been duly executed and
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delivered by the Company, and, assuming the due authorization,
execution and delivery hereof by Parent and Subsidiary,
constitutes a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its
terms, except that such enforcement may be subject to (a) bank-
ruptcy, insolvency, reorganization, moratorium or other similar
laws affecting or relating to enforcement of creditors' rights
generally and (b) general equitable principles. Without
limitation of the foregoing, each of the covenants and
obligations of the Company set forth in Sections 6.1, 6.5, 7.1,
7.2, 7.3, 7.6, 7.7, 7.8, 7.10 and 7.12 is valid, legally
binding and enforceable notwithstanding the absence of the
Company Stockholders' Approval.
(b) The execution and delivery of this Agreement by the
Company do not violate, conflict with or result in a breach of
any provision of, or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a
default) under, or result in the termination of, or accelerate
the performance required by, or result in a right of termina-
tion or acceleration under, or result in the creation of any
lien, security interest, charge or encumbrance upon any of the
properties or assets of the Company or any of its subsidiaries
under any of the terms, conditions or provisions of (i) the
respective charters or by-laws of the Company or any of its
subsidiaries, (ii) any statute, law, ordinance, rule,
regulation, judgment, decree, order, injunction, writ, permit
or license of any court or governmental authority applicable to
the Company or any of its subsidiaries or any of their
respective properties or assets, or (iii) any note, bond,
mortgage, indenture, deed of trust, license, franchise, permit,
concession, contract, lease or other instrument, obligation or
agreement of any kind to which the Company or any of its
subsidiaries is now a party or by which the Company or any of
its subsidiaries or any of their respective properties or
assets may be bound or affected. The consummation by the
Company of the transactions contemplated hereby will not result
in any violation, conflict, breach, termination, acceleration
or creation of liens under any of the terms, conditions or
provisions described in clauses (i) through (iii) of the
preceding sentence, subject (x) in the case of the terms,
conditions or provisions described in clause (ii) above, to
obtaining (prior to the Effective Time) the Company Required
Statutory Approvals and the Company Stockholder's Approval and
(y) in the case of the terms, conditions or provisions
described in clause (iii) above, to obtaining (prior to the
Effective Time) consents required from commercial lenders,
lessors or other third parties. Excluded from the foregoing
sentences of this paragraph (b), insofar as they apply to the
terms, conditions or provisions described in clauses (ii) and
(iii) of the first sentence of this paragraph (b), are such
violations, conflicts, breaches, defaults, terminations,
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accelerations or creations of liens, security interests,
charges or encumbrances that would not, in the aggregate, have
a material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of the Company and its subsidiaries, taken as a
whole.
(c) Except for (i) the filings by Parent, the Company and
the Company's principal shareholder required by the HSR Act,
(ii) the filing of the Joint Proxy Statement/Prospectus with
the SEC pursuant to the Exchange Act and the Securities Act and
the declaration of the effectiveness thereof by the SEC and
filings with various state blue sky authorities, (iii) the
making of the Merger Filing with the Secretary of State of the
State of California in connection with the Merger and (iv) any
required filings with or approvals from applicable state
environmental authorities, public service commissions and
public utility commissions (the filings and approvals referred
to in clauses (i) through (iv) are collectively referred to as
the "Company Required Statutory Approvals"), no declaration,
filing or registration with, or notice to, or authorization,
consent or approval of, any governmental or regulatory body or
authority is necessary for the execution and delivery of this
Agreement by the Company or the consummation by the Company of
the transactions contemplated hereby, other than such
declarations, filings, registrations, notices, authorizations,
consents or approvals which, if not made or obtained, as the
case may be, would not, in the aggregate, have a material
adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole.
SECTION 5.5. REPORTS AND FINANCIAL STATEMENTS. Since
July 1, 1993, the Company has filed with the SEC all material
forms, statements, reports and documents (including all
exhibits, amendments and supplements thereto) required to be
filed by it under each of the Securities Act, the Exchange Act
and the respective rules and regulations thereunder, all of
which, as amended if applicable, complied in all material
respects with all applicable requirements of the appropriate
act and the rules and regulations thereunder. The Company has
previously delivered to Parent copies of its (a) Annual Reports
on Form 10-K for the fiscal year ended June 30, 1995, and for
each of the two immediately preceding fiscal years, as filed
with the SEC, (b) proxy and information statements relating to
(i) all meetings of its stockholders (whether annual or
special) and (ii) actions by written consent in lieu of a
stockholders' meeting from July 1, 1993, until the date hereof,
and (c) all other reports, including quarterly reports, or
registration statements filed by the Company with the SEC since
July 1, 1993 (other than Registration Statements filed on
Form S-8) (the documents referred to in clauses (a), (b) and
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(c) are collectively referred to as the "Company SEC Reports").
As of their respective dates, the Company SEC Reports did not
contain any 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, in light of the
circumstances under which they were made, not misleading. The
audited consolidated financial statements and unaudited interim
consolidated financial statements of the Company included in
such reports (collectively, the "Company Financial Statements")
have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis (except as
may be indicated therein or in the notes thereto) and fairly
present the financial position of the Company and its
subsidiaries as of the dates thereof and the results of their
operations and changes in financial position for the periods
then ended, subject, in the case of the unaudited interim
financial statements, to normal year-end and audit adjustments
and any other adjustments described therein.
SECTION 5.6. ABSENCE OF UNDISCLOSED LIABILITIES. Except
as disclosed in the Company SEC Reports, neither the Company
nor any of its subsidiaries had at September 30, 1995, or has
incurred since that date, any liabilities or obligations
(whether absolute, accrued, contingent or otherwise) of any
nature, except (a) liabilities, obligations or contingencies
(i) which are accrued or reserved against in the Company
Financial Statements or reflected in the notes thereto or
(ii) which were incurred after September 30, 1995, and were
incurred in the ordinary course of business and consistent with
past practices, (b) liabilities, obligations or contingencies
which (i) would not, in the aggregate, have a material adverse
effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole, or (ii) have
been discharged or paid in full prior to the date hereof, and
(c) liabilities and obligations which are of a nature not
required to be reflected in the consolidated financial
statements of the Company and its subsidiaries prepared in
accordance with generally accepted accounting principles
consistently applied and which were incurred in the ordinary
course of business.
SECTION 5.7. ABSENCE OF CERTAIN CHANGES OR EVENTS. Since
the date of the most recent Company SEC Report, there has not
been any material adverse change in the business, operations,
properties, assets, liabilities, condition (financial or other)
or results of operations of the Company and its subsidiaries,
taken as a whole.
SECTION 5.8. LITIGATION. Except as referred to in the
Company SEC Reports, there are no claims, suits, actions or
proceedings pending or, to the knowledge of the Company,
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threatened against, relating to or affecting the Company or any
of its subsidiaries, before any court, governmental department,
commission, agency, instrumentality or authority, or any
arbitrator that seek to restrain the consummation of the Merger
or which could reasonably be expected, either alone or in the
aggregate with all such claims, actions or proceedings, to
materially and adversely affect the business, operations,
properties, assets, condition (financial or other) or results
of operations of the Company and its subsidiaries, taken as a
whole. Except as referred to in the Company SEC Reports or in
Schedule 5.8, neither the Company nor any of its subsidiaries
is subject to any judgment, decree, injunction, rule or order
or any court, governmental department, commission, agency,
instrumentality or authority, or any arbitrator which prohibits
or restricts the consummation of the transactions contemplated
hereby or would have any material adverse effect on the
business, operations, properties, assets, condition (financial
or other) or results of operations of the Company and its
subsidiaries, taken as a whole.
SECTION 5.9. REGISTRATION STATEMENT AND PROXY STATEMENT.
None of the information to be supplied by the Company or its
subsidiaries for inclusion in (a) the Registration Statement or
(b) the Proxy Statement will, in the case of the Proxy
Statement or any amendments thereof or supplements thereto, at
the time of the mailing of the Proxy Statement and any
amendments or supplements thereto, and at the time of the
meetings of stockholders of the Company and Parent to be held
in connection with the transactions contemplated by this
Agreement or, in the case of the Registration Statement, as
amended or supplemented, at the time it becomes effective and
at the time of such meetings of the stockholders of the Company
and Parent, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light
of the circumstances under which they are made, not misleading.
The Joint Proxy Statement/Prospectus will comply, as of its
mailing date, as to form in all material respects with all
applicable laws, including the provisions of the Securities Act
and the Exchange Act and the rules and regulations promulgated
thereunder, except that no representation is made by the
Company with respect to information supplied by Parent or
Subsidiary for inclusion therein.
SECTION 5.10. NO VIOLATION OF LAW. Except as disclosed
in the Company SEC Reports or in Schedule 5.8, neither the
Company nor any of its subsidiaries is in violation of or has
been given notice or been charged with any violation of, any
law, statute, order, rule, regulation, ordinance or judgment
(including, without limitation, any applicable environmental
law, ordinance or regulation) of any governmental or regulatory
body or authority, except for violations which, in the
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aggregate, could not reasonably be expected to have a material
adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole. Except as
disclosed in the Company SEC Reports, as of the date of this
Agreement, to the knowledge of the Company, no investigation or
review by any governmental or regulatory body or authority is
pending or threatened, nor has any governmental or regulatory
body or authority indicated an intention to conduct the same,
other than, in each case, those the outcome of which, as far as
reasonably can be foreseen, will not have a material adverse
effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Company and its subsidiaries taken as a whole. The Company and
its subsidiaries have all permits, licenses, franchises,
variances, exemptions, orders and other governmental authori-
zations, consents and approvals necessary to conduct their
businesses as presently conducted (collectively, the "Company
Permits") except for permits, licenses, franchises, variances,
exemptions, orders, authorizations, consents and approvals the
absence of which, alone or in the aggregate, would not have a
material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of the Company and its subsidiaries, taken as a
whole. The Company and its subsidiaries are not in violation
of the terms of any Company Permit, except for delays in filing
reports or violations which, alone or in the aggregate, would
not have a material adverse effect on the business, operations,
properties, assets, condition (financial or other), results of
operations or prospects of the Company and its subsidiaries,
taken as a whole.
SECTION 5.11. COMPLIANCE WITH AGREEMENTS. Except as
disclosed in the Company SEC Reports, the Company and each of
its subsidiaries are not in breach or violation of or in
default in the performance or observance of any term or
provision of, and no event has occurred which, with lapse of
time or action by a third party, could result in a default
under, (a) the respective charters, by-laws or similar
organizational instruments of the Company or any of its
subsidiaries or (b) any contract, commitment, agreement,
indenture, mortgage, loan agreement, note, lease, bond,
license, approval or other instrument to which the Company or
any of its subsidiaries is a party or by which any of them is
bound or to which any of their property is subject, which
breaches, violations and defaults, in the case of clause (b) of
this Section 5.11, would have, in the aggregate, a material
adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole.
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SECTION 5.12. TAXES. The Company and its subsidiaries
have (i) duly filed with the appropriate governmental
authorities all Tax Returns required to be filed by them for
all periods ending on or prior to the Effective Time, other
than those Tax Returns the failure of which to file would not
have a material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results
of operations of the Company and its subsidiaries, taken as a
whole, and such Tax Returns are true, correct and complete in
all material respects, and (ii) duly paid in full or made
adequate provision for the payment of all Taxes for all periods
ending at or prior to the Effective Time. The liabilities and
reserves for Taxes reflected in the Company balance sheet
included in the latest Company SEC Report are adequate to cover
all Taxes for all periods ending at or prior to the Effective
Time and there are no material liens for Taxes upon any
property or asset of the Company or any subsidiary thereof,
except for liens for Taxes not yet due. There are no
unresolved issues of law or fact arising out of a notice of
deficiency, proposed deficiency or assessment from the IRS or
any other governmental taxing authority with respect to Taxes
of the Company or any of its subsidiaries which, if decided
adversely, singly or in the aggregate, would have a material
adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole. Neither the
Company nor any of its subsidiaries is a party to any agreement
providing for the allocation or sharing of Taxes with any
entity that is not, directly or indirectly, a wholly-owned
corporate subsidiary of Company. Neither the Company nor any
of its corporate subsidiaries has, with regard to any assets or
property held, acquired or to be acquired by any of them, filed
a consent to the application of Section 341(f) of the Code.
SECTION 5.13. EMPLOYEE BENEFIT PLANS; ERISA. (a) Except
as set forth in the Company SEC Reports, at the date hereof,
the Company and its subsidiaries do not maintain or contribute
to any material employee benefit plans, programs, arrangements
and practices (such plans, programs, arrangements and practices
of the Company and its subsidiaries being referred to as the
"Company Plans"), including employee benefit plans within the
meaning set forth in Section 3(3) of ERISA, or other similar
material arrangements for the provision of benefits (excluding
any "Multi-employer Plan" within the meaning of Section 3(37)
of ERISA or a "Multiple Employer Plan" within the meaning of
Section 413(c) of the Code). The Company Disclosure Schedule
lists all Multi-employer Plans and Multiple Employer Plans
which any of the Company or its subsidiaries maintains or to
which any of them makes contributions. Neither the Company nor
its subsidiaries has any obligation to create any additional
such plan or to amend any such plan so as to increase benefits
thereunder, except as required under the terms of the Company
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Plans, under existing collective bargaining agreements or to
comply with applicable law.
(b) Except as disclosed in the Company SEC Reports,
(i) there have been no prohibited transactions within the
meaning of Section 406 or 407 of ERISA or Section 4975 of the
Code with respect to any of the Company Plans that could result
in penalties, taxes or liabilities which, singly or in the
aggregate, could have a material adverse effect on the
business, operations, properties, assets, condition (financial
or other) or results of operations of the Company and its
subsidiaries, taken as a whole, (ii) except for premiums due,
there is no outstanding material liability, whether measured
alone or in the aggregate, under Title IV of ERISA with respect
to any of the Company Plans, (iii) neither the Pension Benefit
Guaranty Corporation nor any plan administrator has instituted
proceedings to terminate any of the Company Plans subject to
Title IV of ERISA other than in a "standard termination"
described in Section 4041(b) of ERISA, (iv) none of the Company
Plans has incurred any "accumulated funding deficiency" (as
defined in Section 302 of ERISA and Section 412 of the Code),
whether or not waived, as of the last day of the most recent
fiscal year of each of the Company Plans ended prior to the
date of this Agreement, (v) the current present value of all
projected benefit obligations under each of the Company Plans
which is subject to Title IV of ERISA did not, as of its latest
valuation date, exceed the then current value of the assets of
such plan allocable to such benefit liabilities by more than
the amount, if any, disclosed in the Company SEC Reports as of
September 30, 1994, based upon reasonable actuarial assumptions
currently utilized for such Company Plan, (vi) each of the
Company Plans has been operated and administered in all
material respects in accordance with applicable laws during the
period of time covered by the applicable statute of limita-
tions, (vii) each of the Company Plans which is intended to be
"qualified" within the meaning of Section 401(a) of the Code
has been determined by the Internal Revenue Service to be so
qualified and such determination has not been modified, revoked
or limited by failure to satisfy any condition thereof or by a
subsequent amendment thereto or a failure to amend, except that
it may be necessary to make additional amendments retroactively
to maintain the "qualified" status of such Company Plans, and
the period for making any such necessary retroactive amendments
has not expired, (viii) with respect to Multi-employer Plans,
neither the Company nor any of its subsidiaries has, made or
suffered a "complete withdrawal" or a "partial withdrawal," as
such terms are respectively defined in Sections 4203, 4204 and
4205 of ERISA and, to the best knowledge of the Company and its
subsidiaries, no event has occurred or is expected to occur
which presents a material risk of a complete or partial
withdrawal under said Sections 4203, 4204 and 4205, (ix) to the
best knowledge of the Company and its subsidiaries, there are
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no material pending, threatened or anticipated claims involving
any of the Company Plans other than claims for benefits in the
ordinary course, and (x) the Company and its subsidiaries have
no current material liability, whether measured alone or in the
aggregate, for plan termination or withdrawal (complete or
partial) under Title IV of ERISA based on any plan to which any
entity that would be deemed one employer with the Company and
its subsidiaries under Section 4001 of ERISA or Section 414 of
the Code contributed during the period of time covered by the
applicable statute of limitations (the "Company Controlled
Group Plans"), and the Company and its subsidiaries do not
reasonably anticipate that any such liability will be asserted
against the Company or any of its subsidiaries. None of the
Company Controlled Group Plans has an "accumulated funding
deficiency" (as defined in Section 302 of ERISA and 412 of the
Code).
(c) The Company SEC Reports contain a true and complete
summary or list of or otherwise describe all material
employment contracts and other employee benefit arrangements
with "change of control" or similar provisions and all
severance agreements with executive officers.
(d) There are no agreements which will or may provide
payments to any officer, employee, stockholder, or highly
compensated individual which will be "parachute payments" under
Code Section 28OG that are nondeductible to the Company or
subject to tax under Code Section 4999 for which the Company or
any ERISA Affiliate would have withholding liability.
SECTION 5.14. LABOR CONTROVERSIES. Except as set forth
in the Company SEC Reports, (a) there are no significant
controversies pending or, to the knowledge of the Company,
threatened between the Company or its subsidiaries and any
representatives of any of their employees and (b) to the
knowledge of the Company, there are no material organizational
efforts presently being made involving any of the presently
unorganized employees of the Company or its subsidiaries,
except for such Controversies and organizational efforts,
which, singly or in the aggregate, could not reasonably be
expected to materially and adversely affect the business,
operations, properties, assets, condition (financial or other)
or results of operations of the Company and its subsidiaries,
taken as a whole.
SECTION 5.15. ENVIRONMENTAL MATTERS. Except as set forth
in the Company SEC Reports, (i) the Company and its subsidi-
aries have conducted their respective businesses in compliance
with all applicable Environmental Laws, including, without
limitation, having all permits, licenses and other approvals
and authorizations necessary for the operation of their
respective businesses as presently conducted, (ii) none of the
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properties owned by the Company or any of its subsidiaries
contain any Hazardous Substance as a result of any activity of
the Company or any of its subsidiaries in amounts exceeding
the levels permitted by applicable Environmental Laws,
(iii) neither the Company nor any of its subsidiaries has
received any notices, demand letters or requests for
information from any Federal, state, local or foreign
governmental entity or third party indicating that the Company
or any of its subsidiaries may be in violation of, or liable
under, any Environmental Law in connection with the ownership
or operation of their businesses, (iv) there are no civil,
criminal or administrative actions, suits, demands, claims,
hearings, investigations or proceedings pending or threatened,
against the Company or any of its subsidiaries relating to any
violation, or alleged violation, of any Environmental Law,
(v) no reports have been filed, or are required to be filed, by
the Company or any of its subsidiaries concerning the release
of any Hazardous Substance or the threatened or actual
violation of any Environmental Law, (vi) no Hazardous Substance
has been disposed of, released or transported in violation of
any applicable Environmental Law from any properties owned by
the Company or any of its subsidiaries as a result of any
activity of the Company or any of its subsidiaries during the
time such properties were owned, leased or operated by the
Company or any of its subsidiaries, (vii) there have been no
environmental investigations, studies, audits, tests, reviews
or other analyses regarding compliance or noncompliance with
any applicable Environmental Law conducted by or which are in
the possession of the Company or its subsidiaries relating to
the activities of the Company or its subsidiaries which have
not been delivered to Parent prior to the date hereof,
(viii) there are no underground storage tanks on, in or under
any properties owned by the Company or any of its subsidiaries
and no underground storage tanks have been closed or removed
from any of such properties during the time such properties
were owned, leased or operated by the Company or any of its
subsidiaries, (ix) there is no asbestos or asbestos containing
material present in any of the properties owned by the Company
and its subsidiaries, and no asbestos has been removed from any
of such properties during the time such properties were owned,
leased or operated by the Company or any of its subsidiaries,
and (x) neither the Company, its subsidiaries nor any of their
respective properties are subject to any material liabilities
or expenditures (fixed or contingent) relating to any suit,
settlement, court order, administrative order, regulatory
requirement, judgment or claim asserted or arising under any
Environmental Law, except for violations of the foregoing
clauses (i) through (x) that, singly or in the aggregate, would
not reasonably be expected to have a material adverse effect on
the business, operations, properties, assets, condition
(financial or other) or results of operations of the Company
and its subsidiaries considered as one enterprise.
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SECTION 5.16. NON-COMPETITION AGREEMENTS. Neither the
Company nor any subsidiary of the Company is a party to any
agreement which purports to restrict or prohibit in any
material respect any of them from, directly or indirectly,
engaging in any business involving the collection, interim
storage, transfer, recovery, processing, recycling, marketing
or disposal of rubbish, garbage, paper, textile wastes,
chemical or hazardous wastes, liquid and other wastes or any
other material business currently engaged in by the Parent or
the Company, or any corporations affiliated with either of
them. None of the Company's officers, directors or key
employees is a party to any agreement which, by virtue of such
person's relationship with the Company, restricts in any
material respect the Company or any subsidiary of the Company
from, directly or indirectly, engaging in any of the businesses
described above.
SECTION 5.17. TITLE TO ASSETS. The Company and each of
its subsidiaries has good and marketable title in fee simple to
all its real property and good title to all its leasehold
interests and other properties, as reflected in the most recent
balance sheet included in the Company Financial Statements,
except for properties and assets that have been disposed of in
the ordinary course of business since the date of such balance
sheet, free and clear of all mortgages, liens, pledges, charges
or encumbrances of any nature whatsoever, except (1) the lien
of current taxes, payments of which are not yet delinquent,
(ii) such imperfections in title and easements and
encumbrances, if any, as are not substantial in character,
amount or extent and do not materially detract from the value,
or interfere with the present use of the property subject
thereto or affected thereby, or otherwise materially impair the
Company's business operations (in the manner presently carried
on by the Company) or (iii) as disclosed in the Company SEC
Reports, and except for such matters which, singly or in the
aggregate, could not reasonably be expected to materially and
adversely affect the business, operations, properties, assets,
condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole. All leases
under which the Company leases any substantial amount of real
or personal property have been delivered to Parent and are in
good standing, valid and effective in accordance with their
respective terms, and there is not, under any of such leases,
any existing default or event which with notice or lapse of
time or both would become a default other than defaults under
such leases which in the aggregate will not materially and
adversely affect the condition of the Company.
SECTION 5.18. POOLING OF INTERESTS. Neither the Company
nor, to the knowledge of the Company, any of its affiliates has
taken or agreed to take any action that would prevent the
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Merger from (a) constituting a reorganization qualifying under
the provisions of Section 368(a) of the Code or (b) being
treated for financial accounting purposes as a Pooling
Transaction.
SECTION 5.19. COMPANY STOCKHOLDERS' APPROVAL. The
affirmative vote of stockholders of the Company required for
approval and adoption of this Agreement and the Merger is (i) a
majority of the shares of Company Common Stock present in
person or by proxy at a meeting of such stockholders and
entitled to vote thereat.
SECTION 5.20. BROKERS AND FINDERS. Except for the fees
and expenses payable to Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("Merrill"), which fees are reflected in its
agreement with the Company (a copy of which has been delivered
to Parent), the Company has not entered into any contract,
arrangement or understanding with any person or firm which may
result in the obligation of the Company to pay any finder's
fees, brokerage or agent commissions or other like payments in
connection with the transactions contemplated hereby. Except
for the fees and expenses paid or payable to Merrill, there is
no claim for payment by the Company of any investment banking
fees, finder's fees, brokerage or agent commissions or other
like payments in connection with the negotiations leading to
this Agreement or the consummation of the transactions
contemplated hereby.
Section 5.21. OPINION OF FINANCIAL ADVISOR. The
financial advisor of the Company, Merrill, has rendered a
written opinion to the Company to the effect that the Exchange
Ratio is fair from a financial point of view to the
shareholders of the Company (other than Parent and its
affiliates).
ARTICLE VI
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 6.1. CONDUCT OF BUSINESS BY THE COMPANY PENDING
THE MERGER. Except as otherwise contemplated by this Agreement
or disclosed in Section 6.1 of the Company Disclosure Schedule,
after the date hereof and prior to the Closing Date or earlier
termination of this Agreement, unless Parent shall otherwise
agree in writing, the Company shall, and shall cause its
subsidiaries, to:
(a) conduct their respective businesses in the
ordinary and usual course of business and consistent with
past practice;
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(b) not (i) amend or propose to amend their
respective charters or by-laws, (ii) split, combine or
reclassify their outstanding capital stock or (iii)
declare, set aside or pay any dividend or distribution
payable in cash, stock, property or otherwise, except for
the payment of dividends or distributions by a wholly-
owned subsidiary of the Company;
(c) not issue, sell, pledge or dispose of, or agree
to issue, sell, pledge or dispose of, any additional
shares of, or any options, warrants or rights of any kind
to acquire any shares of their capital stock of any class
or any debt or equity securities convertible into or
exchangeable for such capital stock, except that
(i) Company may issue shares upon conversion of con-
vertible securities and exercise of options outstanding on
the date hereof and (ii) Company may issue shares and
warrants to acquire shares pursuant to the proviso of
Section 6.1(d) below;
(d) not (i) incur or become contingently liable with
respect to any indebtedness for borrowed money other than
(A) borrowings in the ordinary course of business or
(B) borrowings to refinance existing indebtedness on terms
which are reasonably acceptable to Parent or (C) except as
set forth in this Section 6.1(d), (ii) redeem, purchase,
acquire or offer to purchase or acquire any shares of its
capital stock or any options, warrants or rights to
acquire any of its capital stock or any security
convertible into or exchangeable for its capital stock,
(iii) take any action which would jeopardize the treatment
of the Merger as a pooling of interests under Opinion
No. 16 of the Accounting Principles Board ("APB No. 16"),
(iv) take or fail to take any action which action or
failure to take action would cause the Company or its
stockholders (except to the extent that any stockholders
receive cash in lieu of fractional shares) to recognize
gain or loss for federal income tax purposes as a result
of the consummation of the Merger, (v) make any
acquisition of any assets or businesses other than
expenditures for fixed or capital assets in the ordinary
course of business and consistent with the Company's
capital budget disclosed in Section 6.1 of the Company
Disclosure Schedule and other than as set forth in the
proviso in this Section 6.1(d), (vi) sell, pledge, dispose
of or encumber any assets or businesses other than sales
in the ordinary course of business or (vii) enter into any
contract, agreement, commitment or arrangement with
respect to any of the foregoing; provided, however,
notwithstanding the foregoing, the Company shall not be
prohibited from acquiring any assets or businesses or
issuing capital stock (or warrants or options to acquire
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capital stock) or incurring or assuming, indebtedness in
connection with such acquisitions so long as (x) the
aggregate value of consideration paid or payable in
connection with all such acquisitions, including any
funded indebtedness assumed and any Company Common Stock
does not exceed $40 million, (y) the aggregate value of
consideration paid or payable for any one such acquisition
does not exceed $10 million, including any indebtedness
assumed and any Company Common Stock issued or issuable
and (z) the Company will not acquire or agree to acquire
any assets or business if such acquisition or agreement
may reasonably be expected to delay the consummation of
the Merger;
(e) use all reasonable efforts to preserve intact
their respective business organizations and goodwill, keep
available the services of their respective present
officers and key employees, and preserve the goodwill and
business relationships with customers and others having
business relationships with them and not engage in any
action, directly or indirectly, with the intent to
adversely impact the transactions contemplated by this
Agreement;
(f) subject to restrictions imposed by applicable
law, confer on a regular and frequent basis with one or
more representatives of Parent to report operational
matters of materiality and the general status of ongoing
operations;
(g) not enter into or amend any employment,
severance, special pay arrangement with respect to
termination of employment or other similar arrangements or
agreements with any directors, officers or key employees,
except in the ordinary course and consistent with past
practice; provided, however, that the Company and its
subsidiaries shall in no event enter into any written
employment agreement;
(h) not adopt, enter into or amend any bonus, profit
sharing, compensation, stock option, pension, retirement,
deferred compensation, health care, employment or other
employee benefit plan, agreement, trust, fund or
arrangement for the benefit or welfare of any employee or
retiree, except as required to comply with changes in
applicable law; and
(i) use commercially reasonable efforts to maintain
with financially responsible insurance companies insurance
on its tangible assets and its businesses in such amounts
and against such risks and losses as are consistent with
past practice.
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SECTION 6.2. Conduct of Business by Parent and Subsidiary
Pending the Merger. Except as otherwise contemplated by this
Agreement, after the date hereof and prior to the Closing Date
or earlier termination of this Agreement, unless the Company
shall otherwise agree in writing, Parent shall, and shall cause
its subsidiaries, to:
(a) conduct their respective businesses in the
ordinary and usual course of business and consistent with
past practice;
(b) not (i) amend or propose to amend their
respective charters or by-laws, (ii) split, combine or
reclassify (whether by stock dividend or otherwise) their
outstanding capital stock, or (iii) declare, set aside or
pay any dividend or distribution payable in cash, stock,
property or otherwise, except for the payment of dividends
or distributions by a wholly-owned subsidiary of Parent;
(c) not issue, sell, pledge or dispose of, or agree
to issue, sell, pledge or dispose of, any additional
shares of, or any options, warrants or rights of any kind
to acquire any shares of their capital stock of any class
or any debt or equity securities convertible into or
exchangeable for such capital stock, except that
(i) Parent may issue shares upon conversion of convertible
securities and exercise of options outstanding on the date
hereof, (ii) Parent may issue options (and shares upon
exercise of such options) pursuant to its employee stock
option plans in effect on the date hereof in the ordinary
course of business and consistent with past practices and
(iii) Parent may issue shares and warrants to acquire
shares pursuant to the proviso of Section 6.2(d) below;
(d) (i) incur or become contingently liable with
respect to any indebtedness for borrowed money other than
(A) borrowings in the ordinary course of business,
(B) borrowings to refinance existing indebtedness on terms
which are reasonably acceptable to the Company, or (C) as
set forth in Section 6.2(d) below, (ii) redeem, purchase,
acquire or offer to purchase or acquire any shares of its
capital stock or any options, warrants or rights to
acquire any of its capital stock or any security
convertible into or exchangeable for its capital stock,
(iii) not (A) take any action which would jeopardize the
treatment of the Merger as a pooling of interests under
APB No. 16, or (B) take or fail to take any action which
action or failure to take action would cause Parent or its
stockholders (except to the extent that any stockholders
receive cash in lieu of fractional shares) to recognize
gain or loss for federal income tax purposes as a result
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of the consummation of the Merger, (iv) make any
acquisition of any assets or businesses other than as set
forth in the proviso of this Section 6.2(d), (v) sell,
pledge, dispose of or encumber any assets or businesses
other than sales in the ordinary course of business or
(vi) enter into any contract, agreement, commitment or
arrangement with respect to any of the foregoing;
provided, however, notwithstanding the foregoing, Parent
shall not be prohibited from acquiring any assets or
businesses or issuing capital stock (or warrants or
options to acquire capital stock) or incurring or assuming
indebtedness in connection with such acquisitions so long
as (w) the number of shares of Parent Common Stock issued
or issuable in connection with such transactions does not
exceed 6.0 million shares, (x) the aggregate value of
consideration paid or payable in connection with all such
acquisitions, including any funded indebtedness assumed
and any Parent Common Stock (valued for purposes of this
limitation at $20 per share) does not exceed $120 million,
(y) the aggregate value of consideration paid or payable
for any one such acquisition does not exceed $25 million,
including any indebtedness assumed and any Parent Common
Stock issued or issuable (valued for purposes of this
limitation at $20 per share) and (z) the Parent will not
acquire or agree to acquire any assets or business is such
acquisition or agreement may reasonably be expected to
delay the consummation of the Merger;
(e) use all reasonable efforts to preserve intact
their respective business organizations and goodwill, keep
available the services of their respective present
officers and key employees, and preserve the goodwill and
business relationships with customers and others having
business relationships with them and not engage in any
action, directly or indirectly, with the intent to
adversely impact the transactions contemplated by this
Agreement;
(f) subject to restrictions imposed by applicable
law, confer on a regular and frequent basis with one or
more representatives of the Company to report operational
matters of materiality and the general status of ongoing
operations; and
(g) use commercially reasonable efforts to maintain
with financially responsible insurance companies insurance
on its tangible assets and its businesses in such amounts
and against such risks and losses as are consistent with
past practice.
SECTION 6.3. CONTROL OF THE COMPANY'S OPERATIONS.
Nothing contained in this Agreement shall give to Parent,
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directly or indirectly, rights to control or direct the
Company's operations prior to the Effective Time. Prior to the
Effective Time, the Company shall exercise, consistent with the
terms and conditions of this Agreement, complete control and
supervision of its operations.
SECTION 6.4. CONTROL OF PARENT'S OPERATIONS. Nothing
contained in this Agreement shall give to the Company, directly
or indirectly, rights to control or direct Parent's operations
prior to the Effective Time. Prior to the Effective Time,
Parent shall exercise, consistent with the terms and conditions
of this Agreement, complete control and supervision of its
operations.
SECTION 6.5. ACQUISITION TRANSACTIONS. (a) After the
date hereof and prior to the Effective Time or earlier
termination of this Agreement, the Company shall not, and shall
not permit any of its subsidiaries to, initiate, solicit,
negotiate, encourage or provide confidential information to
facilitate, and the Company shall, and shall cause each of its
subsidiaries to, cause any officer, director or employee of, or
any attorney, accountant, investment banker, financial advisor
or other agent retained by it, not to initiate, solicit,
negotiate, encourage or provide non-public or confidential
information to facilitate, any proposal or offer to acquire all
or any substantial part of the business and properties of the
Company or any capital stock of the Company, whether by merger,
purchase of assets, tender offer or otherwise, whether for
cash, securities or any other consideration or combination
thereof (any such transactions being referred to herein as
"Acquisition Transactions").
(b) Notwithstanding the provisions of paragraph (a)
above, the Company may, in response to an unsolicited written
proposal with respect to an Acquisition Transaction
("Acquisition Proposal"), furnish (subject to the execution of
a confidentiality agreement and standstill agreement containing
provisions substantially similar to the confidentiality and
standstill provisions of the Confidentiality Agreement, as
hereinafter defined) confidential or non-public information
concerning its business, properties or assets to a financially
capable corporation, partnership, person or other entity or
group (a "Potential Acquirer") and negotiate with such
Potential Acquirer if (i) the Board of Directors of the Company
after consulting with one or more of its independent financial
advisors, concludes that such Acquisition Proposal (if
consummated pursuant to its terms) would result in a
transaction more favorable to the Company's stockholders than
the Merger and (ii) based upon advice of its outside legal
counsel, its board of directors determines in good faith that
the failure to provide such confidential or non-public
information to such Potential Acquirer would constitute a
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breach of its fiduciary duty to its stockholders (any such
Acquisition Proposal meeting the conditions of clauses (i) and
(ii) being referred to as a "Superior Proposal.")
(c) The Company shall immediately notify Parent after
receipt of any Acquisition Proposal or any request for
nonpublic information relating to the Company or its
subsidiaries in connection with an Acquisition Proposal or for
access to the properties, books or records of the Company or
any subsidiary by any person or entity that informs the Board
of Directors of the Company or such subsidiary that it is
considering making, or has made, an Acquisition Proposal. Such
notice to Parent shall be made orally and in writing and shall
indicate in reasonable detail the identity of the offeror and
the terms and conditions of such proposal, inquiry or contact.
ARTICLE VII
ADDITIONAL AGREEMENTS
SECTION 7.1. ACCESS TO INFORMATION. (a) The Company and
its subsidiaries shall afford to Parent and Subsidiary and
their respective accountants, counsel, financial advisors and
other representatives (the "Parent Representatives") and Parent
and its subsidiaries shall afford to the Company and its
accountants, counsel, financial advisors and other
representatives (the "Company Representatives") full access
during normal business hours throughout the period prior to the
Effective Time to all of their respective properties, books,
contracts, commitments and records (including, but not limited
to, Tax Returns) and, during such period, shall furnish
promptly to one another (i) a copy of each report, schedule and
other document filed or received by any of them pursuant to the
requirements of federal or state securities laws or filed by
any of them with the SEC in connection with the transactions
contemplated by this Agreement or which may have a material
effect on their respective businesses, properties or personnel
and (ii) such other information concerning their respective
businesses, properties and personnel as Parent or Subsidiary or
the Company, as the case may be, shall reasonably request;
provided that no investigation pursuant to this Section 7.1
shall amend or modify any representations or warranties made
herein or the conditions to the obligations of the respective
parties to consummate the Merger. Parent and its subsidiaries
shall hold and shall use their reasonable best efforts to cause
the Parent Representatives to hold, and the Company and its
subsidiaries shall hold and shall use their reasonable best
efforts to cause the Company Representatives to hold, in strict
confidence all non-public documents and information furnished
to Parent and Subsidiary or to the Company, as the case may be,
in connection with the transactions contemplated by this
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Agreement, except that (i) Parent, Subsidiary and the Company
may disclose such information as may be necessary in connection
with seeking the Parent Required Statutory Approvals and Parent
Stockholders' Approval, the Company Required Statutory
Approvals and the Company Stockholders' Approval and (ii) each
of Parent, Subsidiary and the Company may disclose any
information that it is required by law or judicial or
administrative order to disclose.
(b) In the event that this Agreement is terminated in
accordance with its terms, each party shall promptly redeliver
to the other all non-public written material provided pursuant
to this Section 7.1 and shall not retain any copies, extracts
or other reproductions in whole or in part of such written
material. In such event, all documents, memoranda, notes and
other writings prepared by Parent or the Company based on the
information in such material shall be destroyed (and Parent and
the Company shall use their respective reasonable best efforts
to cause their advisors and representatives to similarly
destroy their documents, memoranda and notes), and such
destruction (and reasonable best efforts) shall be certified in
writing by an authorized officer supervising such destruction.
(c) The Company shall promptly advise Parent and Parent
shall promptly advise the Company in writing of any change or
the occurrence of any event after the date of this Agreement
having, or which, insofar as can reasonably be foreseen, in the
future may have, any material adverse effect on the business,
operations, properties, assets, condition (financial or other)
or results of operations of the Company and its subsidiaries or
Parent and its subsidiaries, as the case may be, taken as a
whole.
SECTION 7.2. REGISTRATION STATEMENT AND PROXY STATEMENT.
Parent and the Company shall file with the SEC as soon as is
reasonably practicable after the date hereof the Joint Proxy
Statement/Prospectus and shall use all reasonable efforts to
have the Registration Statement declared effective by the SEC
as promptly as practicable. Parent shall also take any action
required to be taken under applicable state blue sky or
securities laws in connection with the issuance of Parent
Common Stock pursuant hereto. Parent and the Company shall
promptly furnish to each other all information, and take such
other actions, as may reasonably be requested in connection
with any action by any of them in connection with the preceding
sentence. The information provided and to be provided by
Parent and the Company, respectively, for use in the Joint
Proxy Statement/Prospectus shall be true and correct in all
material respects without omission of any material fact which
is required to make such information not false or misleading as
of the date thereof and in light of the circumstances under
which given or made.
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SECTION 7.3. STOCKHOLDERS' APPROVALS. (a) The Company
shall, as promptly as practicable, submit this Agreement and
the transactions contemplated hereby for the approval of its
stockholders at a meeting of stockholders and, subject to the
fiduciary duties of the Board of Directors of the Company under
applicable law, shall use its reasonable best efforts to obtain
stockholder approval and adoption (the "Company Stockholders'
Approval") of this Agreement and the transactions contemplated
hereby. Such meeting of stockholders shall be held as soon as
practicable following the date upon which the Registration
Statement becomes effective. Subject to the fiduciary duties
of the Board of Directors of the Company under applicable law,
the Company shall, through its Board of Directors, recommend to
its stockholders approval of the transactions contemplated by
this Agreement.
(b) Parent shall, as promptly as practicable, submit this
Agreement and the transactions contemplated hereby for the
approval of its stockholders at a meeting of stockholders and,
subject to the fiduciary duties of the Board of Directors of
Parent under applicable law, shall use its reasonable best
efforts to obtain stockholder approval and adoption (the
"Parent Stockholders' Approval") of this Agreement and the
transactions contemplated hereby. Such meeting of stockholders
shall be held as soon as practicable following the date on
which the Registration Statement becomes effective. Parent
shall, through its Board of Directors, but subject to the
fiduciary duties of the members thereof, (i) recommend to its
stockholders approval of the transactions contemplated by this
Agreement and (ii) authorize and cause an officer of Parent to
vote Parent's shares of Subsidiary Common Stock for adoption
and approval of this Agreement and the transactions
contemplated hereby and shall take all additional actions as
the sole stockholder of Subsidiary necessary to adopt and
approve this Agreement and the transactions contemplated
hereby.
SECTION 7.4. COMPLIANCE WITH THE SECURITIES ACT. Parent
and the Company shall each use its reasonable best efforts to
cause each principal executive officer, each director and each
other person who is an "affiliate," as that term is used in
paragraphs (c) and (d) of Rule 145 under the Securities Act, of
Parent or the Company, as the case may be, to deliver to Parent
and the Company on or prior to the Effective Time a written
agreement (an "Affiliate Agreement") to the effect that such
person will not offer to sell, sell or otherwise dispose of any
shares of Parent Common Stock issued in the Merger, except, in
each case, pursuant to an effective registration statement or
in compliance with Rule 145, as amended from time to time, or
in a transaction which, in the opinion of legal counsel
satisfactory to Parent, is exempt from the registration
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requirements of the Securities Act and, in any case, until
after the results covering 30 days of post-Merger combined
operations of Parent and the Company have been filed with the
SEC, sent to stockholders of Parent or otherwise publicly
issued.
SECTION 7.5. EXCHANGE LISTING. Parent shall use its
reasonable best efforts to effect, at or before the Effective
Time, authorization for listing on the New York Stock Exchange
Inc. (the "NYSE"), upon official notice of issuance, of the
shares of Parent Common Stock to be issued pursuant to the
Merger.
SECTION 7.6. EXPENSES AND FEES. (a) All costs and
expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party
incurring such expenses, except that those expenses incurred in
connection with printing and filing the Joint Proxy
Statement/Prospectus shall be shared equally by Parent and the
Company.
(b) The Company agrees to pay to Parent a fee equal to
Eighteen Million Dollars ($18,000,000); (i) if the Company
terminates this Agreement pursuant to clause (iii) or (iv) of
Section 9.1(a); or (ii) if Parent terminates this Agreement
pursuant to clause (iv) of Section 9.1(b).
(c) Parent agrees to pay to the Company a fee equal to
Eighteen Million Dollars ($18,000,000) if the Company
terminates this Agreement pursuant to clause (v) of
Section 9.1(a).
SECTION 7.7. AGREEMENT TO COOPERATE. (a) Subject to the
terms and conditions herein provided, each of the parties
hereto shall use all reasonable efforts to take, or cause to be
taken, all action and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions
contemplated by this Agreement, including using its reasonable
efforts to obtain all necessary or appropriate waivers,
consents or approvals of third parties required in order to
preserve material contractual relationships of the Company and
its subsidiaries, all necessary or appropriate waivers,
consents and approvals and SEC "no-action " letters to effect
all necessary registrations, filings and submissions and to
lift any injunction or other legal bar to the Merger (and, in
such case, to proceed with the Merger as expeditiously as
possible), subject, however, to the requisite votes of the
stockholders and boards of directors of the Company and Parent.
(b) Without limitation of the foregoing, each of Parent
and the Company undertakes and agrees to file (and, in the case
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of the Company, shall use its best efforts to cause its
principal shareholder to file) as soon as practicable after the
date hereof a Notification and Report Form under the HSR Act
with the Federal Trade Commission (the "FTC") and the Antitrust
Division of the Department of Justice (the "Antitrust
Division"). Each of Parent and the Company shall (and the
Company shall use its best efforts to cause its principal
shareholder to) (i) use its reasonable efforts to comply as
expeditiously as possible with all lawful requests of the FTC
or the Antitrust Division for additional information and
documents and (ii) not extend any waiting period under the HSR
Act or enter into any agreement with the FTC or the Antitrust
Division not to consummate the transactional contemplated by
this Agreement, except with the prior written consent of the
other parties hereto.
(c) In the event any litigation is commenced by any person
or entity relating to the transactions contemplated by this
Agreement, including any Acquisition Transaction, Parent shall
have the right, at its own expense, to participate therein, and
the Company will not settle any such litigation without the
consent of Parent, which consent will not be unreasonably
withheld.
SECTION 7.8. PUBLIC STATEMENTS. The parties shall
consult with each other prior to issuing any press release or
any written public statement with respect to this Agreement or
the transactions contemplated hereby and shall not issue any
such press release or written public statement prior to such
consultation.
SECTION 7.9. OPTION PLANS. Prior to the Effective Time,
the Company and Parent shall take such action as may be
necessary to cause each unexpired and unexercised option (each
a "Company Option") to be automatically converted at the
Effective Time into an option (each a "Parent Option") to
purchase a number of shares of Parent Common Stock equal to the
number of shares of Company Common Stock that could have been
purchased under the Company Option multiplied by the Exchange
Ratio, at a price per share of Parent Common Stock equal to the
option exercise price determined pursuant to the Company Option
divided by the Exchange Ratio. At the Effective Time, all
references in the stock option agreements to the Company shall
be deemed to refer to Parent. Parent shall assume all of the
Company's obligations with respect to Company Options as so
amended and shall, from and after the Effective Time, make
available for issuance upon exercise of the Parent Options all
shares of Parent Common Stock covered thereby and amend its
Registration Statement on Form S-8 to cover the additional
shares of Parent Common Stock subject to Parent Options granted
in replacement of Company Options.
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SECTION 7.10. NOTIFICATION OF CERTAIN MATTERS. Each of
the Company, Parent and Subsidiary agrees to give prompt notice
to each other of, and to use their respective reasonable best
efforts to prevent or promptly remedy, (i) the occurrence or
failure to occur or the impending or threatened occurrence or
failure to occur, of any event which occurrence or failure to
occur would be likely to cause any of its representations or
warranties in this Agreement to be untrue or inaccurate in any
material respect at any time from the date hereof to the
Effective Time and (ii) any material failure on its part to
comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by it hereunder; provided,
however, that the delivery of any notice pursuant to this
Section 7.10 shall not limit or otherwise affect the remedies
available hereunder to the party receiving such notice.
SECTION 7.11. DIRECTORS' AND OFFICERS' INDEMNIFICATION.
(a) The indemnification provisions of the Articles of
Incorporation of the Surviving Corporation as in effect at the
Effective Time shall not be amended, repealed or otherwise
modified for a period of six years from the Effective Time in
any manner that would adversely affect the rights thereunder of
individuals who at the Effective Time were directors, officers,
employees or agents of the Company, unless such modification is
required by law.
(b) After the Effective Time, each of Parent and the
Surviving Corporation shall, to the fullest extent permitted
under applicable law, indemnify and hold harmless, each present
and former director, officer, employee and agent of the Company
or any of its subsidiaries (each, together with such person's
heirs, executors or administrators, an "indemnified Party" and
collectively, the "indemnified Parties") against any costs or
expenses (including attorneys fees), judgments, fines, losses,
claims, damages, liabilities and amounts paid in settlement in
connection with any claim, action, suit, proceeding or
investigation, whether civil, criminal, administrative or
investigative, arising out of, relating to or in connection
with any action or omission occurring prior to the Effective
Time (including, without limitation, acts or omissions in
connection with such persons serving as an officer, director or
other fiduciary in any entity if such service was at the
request or for the benefit of the Company) or arising out of or
pertaining to the transactions contemplated by this Agreement.
In the event of any such claim, action, suit, proceeding or
investigation (whether arising before or after the Effective
Time), (i) the Company or Parent and the Surviving Corporation,
as the case may be, shall pay the reasonable fees and expenses
of counsel selected by the indemnified Parties, which counsel
shall be reasonably satisfactory to the Parent and the
Surviving Corporation, promptly after statements therefor are
received, (ii) the Parent and the Surviving Corporation will
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cooperate in the defense of any such matter, and (iii) any
determination required to be made with respect to whether an
indemnified Party's conduct complies with the standards set
forth under the CCC and the Parent's or the Surviving
Corporation's respective charters or By-Laws shall be made by
independent legal counsel acceptable to the Parent or the
Surviving Corporation, as the case maybe, and the indemnified
Party; provided, however, that neither Parent nor the Surviving
Corporation shall be liable for any settlement effected without
its written consent (which consent shall not be unreasonably
withheld).
(b) In the event the Surviving Corporation or Parent or
any of their successors or assigns (i) consolidates with or
merges into any other person and shall not be the continuing or
surviving corporation or entity of such consolidation or merger
or (ii) transfers all or substantially all of its properties
and assets to any person, then and in each such case, proper
provisions shall be made so that the successors and assigns of
the Surviving Corporation or Parent shall assume the
obligations set forth in this Section 7.11.
SECTION 7.12. CORRECTIONS TO THE JOINT PROXY STATEMENT/
PROSPECTUS AND REGISTRATION STATEMENT. Prior to the date of
approval of the Merger by their respective stockholders, each
of the Company, Parent and Subsidiary shall correct promptly
any information provided by it to be used specifically in the
Joint Proxy Statement/Prospectus and Registration Statement
that shall have become false or misleading in any material
respect and shall take all steps necessary to file with the SEC
and have declared effective or cleared by the SEC any amendment
or supplement to the Joint Proxy Statement/Prospectus or the
Registration Statement so as to correct the same and to cause
the Joint Proxy Statement/Prospectus as so corrected to be
disseminated to the stockholders of the Company and Parent, in
each case to the extent required by applicable law.
SECTION 7.13. CERTAIN OTHER MATTERS. The Board of
Directors of the Company has approved the implementation of
each of the items on Section 7.13 of the Company Disclosure
Schedule (the "Pre-Closing Items"). The Company shall use its
best efforts to accomplish and effectuate each of the Pre-
Closing Items as promptly as practicable after the date hereof
and in any event, no later than the Effective Time. Notwith-
standing any other term or provision hereof, the Company may
effectuate and consummate the Pre-Closing Items without
Parent's consent.
SECTION 7.14. EFFECT ON ACCOUNTING TREATMENT. Each of
the parties hereto agrees that, notwithstanding anything to the
contrary contained in the Agreement, nothing contained in or
contemplated by this Agreement shall require any of the parties
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hereto to take any action which would jeopardize the treatment
of the Merger as a pooling of interests under APB No. 16.
ARTICLE VIII
CONDITIONS
SECTION 8.1. CONDITIONS TO EACH PARTY'S OBLIGATION TO
EFFECT THE MERGER. The respective obligations of each party to
effect the Merger shall be subject to the fulfillment at or
prior to the Closing Date of the following conditions:
(a) this Agreement and the transactions contemplated
hereby shall have been approved and adopted by the
requisite vote of the stockholders of the Company and
Parent under applicable law and applicable listing
requirements;
(b) the shares of Parent Common Stock issuable in
the Merger shall have been authorized for listing on the
NYSE upon official notice of issuance;
(c) the waiting period applicable to the
consummation of the Merger under the HSR Act shall have
expired or been terminated;
(d) the Registration Statement shall have become
effective in accordance with the provisions of the
Securities Act, and no stop order suspending such
effectiveness shall have been issued and remain in effect
and no proceeding for that purpose shall have been
instituted by the SEC or any state regulatory authorities;
(e) no preliminary or permanent injunction or other
order or decree by any federal or state court which
prevents the consummation of the Merger shall have been
issued and remain in effect (each party agreeing to use
its reasonable efforts to have any such injunction, order
or decree lifted);
(f) no action shall have been taken, and no statute,
rule or regulation shall have been enacted, by any state
or federal government or governmental agency in the United
States which would prevent the consummation of the Merger
or make the consummation of the Merger illegal;
(g) all governmental waivers, consents, orders and
approvals legally required for the consummation of the
Merger and the transactions contemplated hereby, and all
consents from lenders required to consummate the Merger,
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shall have been obtained and be in effect at the Effective
Time;
(h) Coopers & Lybrand, certificate public
accountants for Parent, shall have delivered a letter,
dated the Closing Date, addressed to Parent, in form and
substance reasonably satisfactory to Parent, to the effect
that the Merger will qualify for a pooling of interests
accounting treatment if consummated in accordance with
this Agreement; and
(i) Ernst & Young LLP, certified public accountants
for the Company, shall have delivered a letter dated the
Closing Date, addressed to the Company, in form and
substance reasonably satisfactory to the Company, stating
that the Merger will qualify for a pooling of interests
accounting treatment if consummated in accordance with
this Agreement.
SECTION 8.2. CONDITIONS TO OBLIGATION OF THE COMPANY TO
EFFECT THE MERGER. Unless waived by the Company, the
obligation of the Company to effect the Merger shall be subject
to the fulfillment at or prior to the Closing Date of the
following additional conditions:
(a) Parent and Subsidiary shall have performed in
all material respects their agreements contained in this
Agreement required to be performed on or prior to the
Closing Date and the representations and warranties of
Parent and Subsidiary contained in this Agreement shall be
true and correct in all material respects on and as of the
date made and on and as of the Closing Date as if made at
and as of such date, and the Company shall have received a
certificate of the Chairman of the Board and Chief
Executive Officer, the President or a Vice President or
Parent and of the President and Chief Executive Officer or
a Vice President of Subsidiary to that effect;
(b) the Company shall have received an opinion of
Sheppard, Mullin, Richter & Hampton, in form and substance
reasonably satisfactory to the Company, dated the Closing
Date, to the effect that the Company and holders of
Company Common Stock (except to the extent any
stockholders receive cash in lieu of fractional shares)
will recognize no gain or loss for federal income tax
purposes as a result of consummation of the Merger.
(c) since the date hereof, there shall have been no
changes that constitute, and no event or events shall have
occurred which have resulted in or constitute, a material
adverse change in the business, operations, properties,
assets, condition (financial or other) or results of
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operations of Parent and its subsidiaries, taken as a
whole; and
(d) all governmental waivers, consents, orders, and
approvals legally required for the consummation of the
Merger and the transactions contemplated hereby shall have
been obtained and be in effect at the Closing Date, and no
governmental authority shall have promulgated any statute,
rule or regulation which, when taken together with all
such promulgations, would materially impair the value to
Parent of the Merger.
SECTION 8.3. CONDITIONS TO OBLIGATIONS OF PARENT AND
SUBSIDIARY TO EFFECT THE MERGER. Unless waived by Parent and
Subsidiary, the obligations of Parent and Subsidiary to effect
the Merger shall be subject to the fulfillment at or prior to
the Effective Time of the additional following conditions:
(a) the Company shall have performed in all material
respects its agreements contained in this Agreement
required to be performed on or prior to the Closing Date
and the representations and warranties of the Company
contained in this Agreement shall be true and correct in
all material respects on and as of the date made and on
and as of the Closing Date as if made at and as of such
date, and Parent shall have received a Certificate of the
President and Chief Executive Officer or of a Vice
President of the Company to that effect;
(b) Parent shall have received an opinion of
Andrews & Kurth L.L.P., in form and substance reasonably
satisfactory to Parent, dated the Closing Date, to the
effect that Parent and Subsidiary will recognize no gain
or loss for federal income tax purposes as a result of
consummation of the Merger.
(c) the Affiliate Agreements required to be
delivered to Parent pursuant to Section 7.4 shall have
been furnished as required by Section 7.4;
(d) since the date hereof, there shall have been no
changes that constitute, and no event or events shall have
occurred which have resulted in or constitute, a material
adverse change in the business, operations, properties,
assets, condition (financial or other) or results of
operations of the Company and its subsidiaries, taken as a
whole; and
(e) all governmental waivers, consents, orders and
approvals legally required for the consummation of the
Merger and the transactions contemplated hereby shall have
been obtained and be in effect at the Closing Date, and no
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governmental authority shall have promulgated any statute,
rule or regulation which, when taken together with all
such promulgations, would materially impair the value to
Parent of the Merger.
ARTICLE IX
TERMINATION, AMENDMENT AND WAIVER
SECTION 9.1. TERMINATION. This Agreement may be
terminated at any time prior to the Closing Date, whether
before or after approval by the stockholders of the Company or
Parent, as follows:
(a) The Company shall have the right to terminate
this Agreement:
(i) if the Merger is not completed by June 30,
1996 (provided that the right to terminate this
Agreement under this Section 9.1(a)(i) shall not be
available to the Company if the failure of the
Company to fulfill any obligation to Parent under or
in connection with this Agreement has been the cause
of or resulted in the failure of the Merger to occur
on or before such date);
(ii) if the Merger is enjoined by a final,
unappealable court order;
(iii) if (A) the Company receives an offer from
any third party (excluding any affiliate of the
Company or any group of which any affiliate of the
Company is a member) with respect to a merger, sale
of substantial assets or other business combination
involving the Company, and (B) the Company's Board of
Directors determines, in good faith and after
consultation with an independent financial advisor,
that such offer constitutes a Superior Proposal and
resolves to accept such a Superior Proposal and
(C) the Company shall have given Parent two (2) days'
prior written notice of its intention to terminate
pursuant to this provision, provided that such
termination shall not be effective until such time as
the payment required by Section 7.6(b) shall have
been received by Parent;
(iv) if (A) a tender or exchange offer is
commenced by a third party (excluding any affiliate
of the Company of any group of which any affiliate of
the Company is a member) for all outstanding shares
of Company Common Stock, (B) the Company's Board of
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Directors determines, in good faith and after
consultation with an independent financial advisor,
that such offer constitutes a Superior Proposal and
resolved to accept such Superior Proposal or
recommend to the stockholders that they tender their
shares in such tender or exchange offer and (C) the
Company shall have given Parent two (2) days' prior
written notice of its intention to terminate pursuant
to this provision, provided that such termination
shall not be effective until such time as the payment
required by Section 7.6(b) shall have been received
by Parent; or
(v) if Parent (A) fails to perform in any
material respect any of its material covenants in
this Agreement and (B) does not cure such default in
all material respects within 30 days after notice of
such default is given to Parent by the Company.
(b) Parent shall have the right to terminate this
Agreement:
(i) if the Merger is not completed by June 30,
1996 (provided that the right to terminate this
Agreement under this Section 9.1(b)(i) shall not be
available to Parent if the failure of Parent to
fulfill any obligation to the Company under or in
connection with this Agreement has been the cause of
or resulted in the failure of the Merger to occur on
or before such date);
(ii) if the Merger is enjoined by a final,
unappealable court order;
(iii) if the Board of Directors of the Company
shall have resolved to accept a Superior Proposal or
shall have recommended to the stockholders of the
Company that they tender their shares in a tender or
an exchange offer commenced by a third party
(excluding any affiliate of Parent or any group of
which any affiliate of Parent is a member); or
(iv) if the Company (A) fails to perform in any
material respect any of its material covenants in
this Agreement and (B) does not cure such default in
all material respects within 30 days after notice of
such default is given to the Company by Parent.
(c) As used in this Section 9.1, (i) "affiliate" has
the meaning assigned to it in Section 7.4 and (ii) "group"
has the meaning set forth in Section 13(d) of the Exchange
Act and the rules and regulations thereunder.
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SECTION 9.2. EFFECT OF TERMINATION. In the event of
termination of this Agreement by either Parent or the Company
pursuant to the provisions of Section 9.1, this Agreement shall
forthwith become void and there shall be no further obligation
on the part of the Company, Parent, Subsidiary or their
respective officers or directors (except as set forth in this
Section 9.2 and in Sections 7.1 and 7.6, all of which shall
survive the termination). Nothing in this Section 9.2 shall
relieve any party from liability for any willful or intentional
breach of this Agreement.
SECTION 9.3. AMENDMENT. This Agreement may not be
amended except by action taken by the parties' respective
Boards of Directors or duly authorized committees thereof and
then only by an instrument in writing signed on behalf of each
of the parties hereto and in compliance with applicable law.
SECTION 9.4. WAIVER. At any time prior to the Effective
Time, the parties hereto may (a) extend the time for the
performance of any of the obligations or other acts of the
other parties hereto, (b) waive any inaccuracies in the
representations and warranties contained herein or in any
document delivered pursuant thereto and (c) waive compliance
with any of the agreements or conditions contained herein. Any
agreement on the part of a party hereto to any such extension
or waiver shall be valid if set forth in an instrument in
writing signed on behalf of such party.
ARTICLE X
GENERAL PROVISIONS
SECTION 10.1. NON-SURVIVAL OF REPRESENTATIONS AND
WARRANTIES. All representations and warranties in this
Agreement shall not survive the Merger, and after effectiveness
of the Merger neither the Company, Parent, Subsidiary or their
respective officers or directors shall have any further
obligation with respect thereto.
SECTION 10.2. NOTICES. All notices and other
communications hereunder shall be in writing and shall be
deemed given if delivered personally, mailed by registered or
certified mail (return receipt requested) or sent via facsimile
to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
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(a) If to Parent or Subsidiary to:
USA Waste Services, Inc.
5400 LBJ Freeway
Suite 300 - Tower One
Dallas, Texas 75240
Attention: Chief Executive Officer
Telecopy: 214-383-7919
with a copy to:
Gregory T. Sangalis
5400 LBJ Freeway
Suite 300 - Tower One
Dallas, Texas 75240
Telecopy: 214-383-7919
(b) If to the Company, to:
Western Waste Industries
21061 South Western Avenue
Torrance, California 90501
Attention: Chief Executive Officer
Telecopy: 310-212-7093
with copies to:
Arnold Rothlisberger
Western Waste Industries
21061 South Western Avenue
Torrance, California 90501
Telecopy: 310-212-7093
James J. Slaby
Sheppard, Mullin, Richter
& Hampton
333 South Hope Street
48th Floor
Los Angeles, California 90071
SECTION 10.3. INTERPRETATION. THe headings contained in
this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this
Agreement. In this Agreement, unless a contrary intention
appears, (i) the words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Agreement as a
whole and not to any particular Article, Section or other
subdivision and (ii) reference to any Article or Section means
such Article or Section hereof. No provision of this Agreement
shall be interpreted or construed against any party hereto
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solely because such party or its legal representative drafted
such provision.
SECTION 10.4. MISCELLANEOUS. This Agreement (including
the documents and instruments referred to herein)
(a) constitutes the entire agreement and supersedes all other
prior agreements and understandings, both written and oral,
among the parties, or any of them, with respect to the subject
matter hereof (including the provisions of that certain
Agreement dated December 9, 1995 by and between the Company and
Parent concerning confidentiality and related matters (the
"Confidentiality Agreement"), except that the provisions of
Sections 3 and 4 thereof shall remain in effect), (b) is not
intended to confer upon any other person any rights or remedies
hereunder, except for rights of indemnified Parties under
Section 7.11 and (c) shall not be assigned by operation of law
or otherwise, except that Subsidiary may assign this Agreement
to any other wholly-owned subsidiary of Parent. THIS AGREEMENT
SHALL BE GOVERNED IN ALL RESPECTS, INCLUDING VALIDITY,
INTERPRETATION AND EFFECT, BY THE LAWS OF THE STATE OF DELAWARE
APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED WHOLLY
WITHIN SUCH STATE, EXCEPT TO THE EXTENT THAT THE LAWS OF THE
STATE OF CALIFORNIA MANDATORILY APPLY.
SECTION 10.5. COUNTERPARTS. This Agreement may be
executed in two or more counterparts, each of which shall be
deemed to be an original, but all of which shall constitute one
and the same agreement.
SECTION 10.6. PARTIES IN INTEREST. This Agreement shall
be binding upon and inure solely to the benefit of each party
hereto, and except as set forth in Section 7.11, nothing in
this Agreement, express or implied, is intended to confer upon
any other person any rights or remedies of any nature
whatsoever under or by the reason of this Agreement.
IN WITNESS WHEREOF, Parent, Subsidiary and the
Company have caused this Agreement to be signed by their
respective officers and attested to as of the date first
written above.
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Attest: USA WASTE SERVICES, INC.
/s/ Gregory T. Sangalis /s/ John E. Drury
----------------------------- By:-----------------------
Secretary Name: John E. Drury
Title: Chief/Executive
Officer
Attest: RIVIERA ACQUISITION
CORPORATION
/s/ Gregory T. Sangalis /s/ John E. Drury
----------------------------- By:-----------------------
Secretary Name: John E. Drury
Title: Chief/Executive
Officer
Attest: WESTERN WASTE INDUSTRIES
/s/ Savey Tufenkian /s/ Kosti Shirvanian
----------------------------- By:-----------------------
Secretary Name: Kosti Shirvanian
Title: President and Chief
Executive Officer
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EXHIBIT 99
FOR IMMEDIATE RELEASE
UW #95-14
Contracts:
USA Waste Services, Inc.
------------------------
Lewis E. Nevins
(214) 383-7940
Western Waste Industries
------------------------
Richard F. Widrig
(310) 222-8723
USA WASTE AND WESTERN WASTE
JOINTLY ANNOUNCE MERGER AGREEMENT
Dallas, Texas (December 19, 1995) -- USA Waste Services,
Inc. (NYSE--"UW") and Western Waste Industries (NYSE--"WW")
today jointly announce that both Boards of Directors have
approved the terms of a merger between the two solid waste
organizations. The companies have entered into a definitive
agreement of merger whereby the stockholders of Western Waste
will receive 1.5 shares of USA Waste common stock for each
Western Waste common share. Each company has received opinions
from independent financial advisors to the effect that the
share exchange ratio is fair from a financial point of view.
The closing of the merger is subject to approval by both
companies' stockholders and lenders, Hart-Scott-Rodino anti-
trust clearance, opinions that the merger will qualify as a
tax-free pooling of interest transaction, and other standard
and customary closing requirements.
USA Waste has received an irrevocable proxy from Kosti
Shirvanian, Western Waste's Chairman, CEO and largest
stockholder, to vote his share in favor of the merger. These
shares represent approximately 31% of Western Waste's shares
outstanding. USA Waste currently owns approximately 4.5% of
the Western Waste outstanding shares, with such shares
scheduled to be canceled at the effective time of the merger.
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Page 60 of 62 <PAGE>
USA Waste and Western Waste
Merger Announcement
December 19, 1995
Page 2
USA Waste's stock price closed Monday at $18 7/8 per
share. Based upon Western Waste's approximately 16 million
shares and equivalents outstanding and existing indebtedness,
the merger would be valued at about $525 million. The
companies anticipate that the merger should close in the spring
of 1996. John E. Drury, Chairman and CEO of USA Waste, will
retain that position, and Kosti Shirvanian will become a Vice
Chairman of the Board of USA Waste at the time of the merger.
The combined companies have annualized revenues of over
$800 million and total assets in excess of $1.0 billion. After
the merger, USA Waste will be the third largest solid waste
company in North America and it will have 61 collection
operations, 35 landfills, 24 transfer stations and 5 recycling
operations, serving over one million customers in 23 states.
Mr. Drury stated, "We are extremely pleased and
enthusiastic about the combination of these two fine companies
and believe this will provide significant benefits to both
stockholder groups. We expect the merger to be additive to USA
Waste's earnings per share because of cost savings and
operational improvements expected to be realized by the
combination. Savings should come from combining operations and
reducing administrative and staffing costs. There is also
potential to grow and expand in and around Western Waste's
existing markets in California, Texas, Florida and in other
states."
"We are excited about the opportunities this merger
presents for our customers and our shareholders,"
Mr. Shirvanian said. "This company was started 40 years ago,
and the Western Waste spirit will continue to live and prosper
with this combination."
USA Waste, based in Dallas, Texas, is an integrated, non-
hazardous, solid waste management company serving municipal,
commercial, industrial and residential customers in 21 states.
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USA Waste and Western Waste
Merger Announcement
December 19, 1995
Page 3
Western Waste Industries is an integrated solid waste
service company providing collection, recycling, composting and
disposal for commercial, industrial and residential customers.
The company has operations in California, Texas, Florida,
Arkansas, Louisiana and Colorado.
###
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