<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
SCHEDULE 13D
Under the Securities Exchange Act of 1934
TransAmerican Waste Industries, Inc.
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(Name of the Issuer)
Common Stock, par value $.001 per share
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(Title of Class of Securities)
89351V109
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(CUSIP Number)
Robert K. Moses, Jr.
P.O. Box 27888
Houston, Texas 77227
(713) 621-6191
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
January 31, 1997
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1 (b)(3) or (4), check the following box [ ].
Page 1 of 7 Pages
Exhibit Index on Page 7
<PAGE> 2
CUSIP No. 89351V109 13D Page 2 of 7 Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Robert K. Moses, Jr.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
PF
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS [ ]
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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NUMBER 7 SOLE VOTING POWER
OF
SHARES 4,965,000
BENEFICIALLY -----------------------------------------------------------
OWNED 8 SHARED VOTING POWER
BY 0
EACH -----------------------------------------------------------
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
WITH
4,965,000
-----------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,965,000
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
11.2%
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14 TYPE OF REPORTING PERSON
IN
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<PAGE> 3
CUSIP No. 89351V109 13D Page 3 of 7 Pages
ITEM 1. SECURITY AND ISSUER.
This statement relates to the Common Stock, par value $.001 per share
(the "Common Stock") of TransAmerican Waste Industries, Inc., a Delaware
corporation (the "Issuer"). The address of the principal executive offices of
the Issuer is 314 N. Post Oak Lane, Houston, Texas 77024.
ITEM 2. IDENTITY AND BACKGROUND.
This statement is filed by Robert K. Moses, Jr., who is a natural person
and a citizen of the United States of America. The principal occupation of Mr.
Moses is serving as a business consultant; his business address is P.O. Box
27888, Houston, Texas 77227.
During the past five years, Mr. Moses has not been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors).
Mr. Moses is not currently, and during the last five years has not been, party
to a civil proceeding of a judicial or administrative body of competent
jurisdiction, resulting in a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws, or finding any violations with respect to such law.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Mr. Moses purchased his shares of Common Stock with personal funds in
the amount of $1,225,625.01.
ITEM 4. PURPOSE OF TRANSACTION.
Of the 1,965,000 shares of Common Stock currently owned by Mr. Moses,
90,000 were acquired in the open market through brokerage transactions, and
1,875,000 were acquired through a private placement of the Issuer on January
31, 1997. Mr. Moses purchased his shares of Common Stock for investment
purposes. Mr. Moses intends to review his investment in the Issuer on a
continuing basis and, depending upon the price of the Common Stock, subsequent
developments affecting the Issuer, the Issuer's business and prospects, general
stock market and economic conditions, tax considerations and other factors
deemed relevant, may decide to increase or decrease his current investment in
the Common Stock of the Issuer.
In consideration of a Guaranty Agreement entered into by Mr. Moses on
January 27, 1997, guaranteeing loans in the aggregate principal amount of
$8,500,000 from Southwest Bank of Texas, N.A. to TransAmerican Waste of
Houston, Inc. ("TWH"), Mr. Moses was granted the right to nominate three
directors to the Board of Directors of the Issuer and was granted Warrants
covering 3,000,000 shares of Common Stock of the Issuer. TWH is a subsidiary
of the Issuer. Of the 3,000,000 Warrants for shares of Common Stock of the
Issuer, 2,000,000 have a strike price of $1.00 per share, and 1,000,000 have a
strike price of $1.25 per share. All 3,000,000 Warrants are exercisable on or
before January 31, 2002.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
Based upon information set forth in the Issuer's Quarterly Report on
Form 10-Q for the nine month period ended September 30, 1996, as filed with the
Securities and Exchange Commission, 30,473,041 shares of the Issuer's Common
Stock were considered issued and outstanding as of September 30, 1996.
According to a private placement memorandum of the Issuer, dated January 23,
1997 (the "Memorandum"), after the offering of 10,000,000 shares of Common
Stock pursuant to the Memorandum, there were 41,527,375 shares of Common Stock
issued and outstanding.
Mr. Moses is deemed to be the beneficial owner of 4,965,000 shares of
Common Stock; this number includes 3,000,000 Warrants for shares of Common
Stock exercisable on or before January 31, 2002. The shares of Common Stock
beneficially owned by Mr. Moses constitute approximately 11.2% of the total
issued and outstanding shares of Common Stock at January 23, 1997, taking into
account the shares issued pursuant to the aforementioned Memorandum and the
shares acquirable upon exercise of the 3,000,000 Warrants.
Mr. Moses has the sole power to vote or direct the vote and the sole
power to dispose or to direct the disposition of all shares of Common Stock he
is deemed to beneficially own. Mr. Moses is the only person who has the right
to receive
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CUSIP No. 89351V109 13D Page 4 of 7 Pages
or the power to direct the receipt of dividends from his shares of Common Stock
or the right to receive or the power to direct the proceeds from the sale of
his shares of Common Stock.
Ninety thousand of the shares of Common Stock owned by Mr. Moses were
purchased in the open market through brokerage transactions on the dates, in
the amounts and at the prices set forth below:
<TABLE>
<CAPTION>
DATE OF PURCHASE NUMBER OF SHARES PURCHASED PRICE PER SHARE
---------------- -------------------------- ---------------
<S> <C> <C>
12/03/96 10,000 $1 5/32
12/03/96 40,000 $1 3/16
12/18/96 5,000 $1 3/16
12/18/96 5,000 $1 1/8
12/20/96 10,000 $1 1/16
12/26/96 4,000 $1 1/32
12/26/96 5,000 $1 1/32
12/26/96 1,000 $1 1/32
12/31/96 10,000 $29/32
</TABLE>
On January 31, 1997, Mr. Moses purchased an additional 1,875,000 shares of
Common Stock for $.60 per share in a private placement by the Issuer.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
Mr. Moses entered into an agreement as of January 31, 1997 with the
Issuer, TWH and Thomas J. Fatjo, Jr. (the "Agreement"). Pursuant to the
Agreement, in consideration of the Guaranty Agreement entered into by Mr. Moses
on January 27, 1997, guaranteeing certain loans to TWH, the Issuer granted Mr.
Moses 3,000,000 Warrants covering shares of Common Stock of the Issuer and
agreed that Mr. Moses will have the right to nominate three directors to the
Board of Directors of the Issuer, as long as Mr. Moses is a guarantor of
certain indebtedness, and to nominate two directors if he ceases to be such a
guarantor but owns common stock, warrants or other securities of the Issuer
that constitute on a fully diluted basis in excess of 5% of the outstanding
securities of the Issuer. The Agreement is incorporated herein by reference to
Exhibit 1. Mr. Moses currently intends to nominate himself and two other
individuals to serve as directors. Pursuant to the aforementioned Guaranty
Agreement, Mr. Moses guaranteed loans in the aggregate principal amount of
$8,500,000 from Southwest Bank of Texas, N.A. to TWH.
Two million of the 3,000,000 Warrants for shares of Common Stock granted
to Mr. Moses pursuant to the Agreement have a strike price of $1.00 per share
and are exercisable on or before January 31, 2002. The Warrant representing
these 2,000,000 shares of Common Stock is incorporated herein by reference to
Exhibit 2. The remaining 1,000,000 Warrants granted to Mr. Moses pursuant to
the Agreement have a strike price of $1.25 per share and are exercisable on or
before January 31, 2002. The Warrant representing these 1,000,000 shares of
Common Stock is incorporated herein by reference to Exhibit 3.
Mr. Moses entered into a Registration Rights Agreement dated January 31,
1997 with the Issuer (the "Registration Rights Agreement"). The Registration
Rights Agreement provides that within four months of January 31, 1997, the
Issuer shall file a registration statement covering the resale of the shares of
Common Stock acquirable upon exercise of the Warrants and shall designate such
registration to be a "shelf" registration pursuant to Rule 415 under the
Securities Act
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CUSIP No. 89351V109 13D Page 5 of 7 Pages
of 1933. The Registration Rights Agreement also grants Mr. Moses piggy-back
registration rights, subject to certain terms and conditions. The Registration
Rights Agreement is incorporated herein by reference to Exhibit 4.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
1. Agreement made as of January 31, 1997 by and among TransAmerican
Waste Industries, Inc., TransAmerican Waste of Houston, Inc., Thomas J. Fatjo,
Jr. and Robert K. Moses, Jr.
2. Warrant to Purchase Common Stock of TransAmerican Waste
Industries, Inc. expiring on January 31, 2002
3. Warrant to Purchase Common Stock of TransAmerican Waste
Industries, Inc. expiring on January 31, 2002
4. Registration Rights Agreement, dated January 31, 1997, entered
into by and between TransAmerican Waste Industries, Inc. and Robert K. Moses,
Jr.
<PAGE> 6
CUSIP No. 89351V109 13D Page 6 of 7 Pages
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
February 10, 1997 By: /s/ Robert K. Moses
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Date Name: Robert K. Moses, Jr.
The original statement shall be signed by each person on whose behalf
the statement is filed or his authorized representative. If the statement is
signed on behalf of a person by his authorized representative (other than an
executive officer or general partner of this filing person), evidence of the
representative's authority to sign on behalf of such person shall be filed with
the statement, provided, however, that a power of attorney for this purpose
which is already on file with the Commission may be incorporated by reference.
The name and any title of each person who signs the statement shall be typed or
printed beneath his signature.
ATTENTION: INTENTIONAL MISSTATEMENTS OR OMISSIONS OF FACT CONSTITUTE FEDERAL
CRIMINAL VIOLATIONS
(SEE 18 U.S.C. 1001)
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CUSIP No. 89351V109 13D Page 7 of 7 Pages
EXHIBIT INDEX
Exhibit
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1. Agreement made as of January 31, 1997 by and among TransAmerican Waste
Industries, Inc., TransAmerican Waste of Houston, Inc., Thomas J. Fatjo,
Jr. and Robert K. Moses, Jr.
2. Warrant to Purchase Common Stock of TransAmerican Waste Industries, Inc.
expiring on January 31, 2002
3. Warrant to Purchase Common Stock of TransAmerican Waste Industries, Inc.
expiring on January 31, 2002
4. Registration Rights Agreement, dated January 31, 1997, entered into by
and between TransAmerican Waste Industries, Inc. and Robert K. Moses,
Jr.
<PAGE> 1
EXHIBIT 1
AGREEMENT
This agreement made as of the 31st day of January, 1997 by and among
TransAmerican Waste Industries, Inc., a Delaware corporation ("WSTE"),
TransAmerican Waste of Houston, Inc., a Texas corporation (the "Company"),
Thomas J. Fatjo, Jr. ("TJF") and Robert K. Moses Jr. ("RKM").
RECITALS
WHEREAS, the Company has entered into that certain loan agreement with
Southwest Bank of Texas, N.A., a national banking association ("Southwest
Bank"), dated as of January 27, 1997, providing for a revolving credit loan of
$1,000,000 and a term loan in the original principal amount of $7,500,000, a
copy of which is held by each party hereto ("Loan Agreement");
WHEREAS, each of WSTE, TJF and RKM have jointly and severally guaranteed
the indebtedness evidenced by the Loan Agreement pursuant to separate Guaranty
agreements each dated as of January 27, 1997;
WHEREAS, pursuant to the terms of that certain Agreement Regarding
Purchase of Notes of even date herewith, a copy of which is attached hereto as
Exhibit A, RKM and TJF have certain rights to purchase the Notes evidencing the
loan from Southwest Bank to the Company together with all collateral securing
the same;
WHEREAS, in consideration for RKM's agreement to guarantee the loans to
the Company, the Company and WSTE have granted to RKM certain Warrants and
rights to appoint members to the board of directors of WSTE all as more fully
set forth below;
WHEREAS, the Company, WSTE, RKM and TJF desire to set forth their
various agreements and responsibilities with respect to the Loan Agreement,
Agreement Regarding Purchase of Notes and certain other matters;
NOW THEREFORE, in consideration in the premises and to induce RKM and
TJF to enter into their respective Guaranties in favor of Southwest Bank, the
Company, WSTE, TJF and RKM agree as follows:
1. Certain Defined Terms.
All capitalized terms used in this Agreement and not otherwise
defined herein shall have the meanings ascribed to such terms in the Loan
Agreement.
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2. Board Representation.
In consideration of RKM's execution of his Guaranty in favor of
Southwest Bank, WSTE has increased the number of directors on its Board of
Directors from nine members to eleven members and agrees that so long as RKM is
a Guarantor of indebtedness of WSTE, the Company or any of their subsidiaries
RKM will have the right to nominate three directors to the Board of Directors
of WSTE. In addition if RKM ceases to be a Guarantor of indebtedness of WSTE,
the Company or any of their subsidiaries RKM will have the right to nominate
two directors to the Board of Directors of WSTE so long as RKM owns or holds
common stock, warrants or other securities of WSTE that constitute on a fully
diluted basis in excess of 5% of the outstanding securities of WSTE.
3. Warrants.
As additional consideration for RKM's execution of his Guaranty
in favor of Southwest Bank, WSTE has granted to RKM Warrants for WSTE common
stock covering two million shares of the common stock WSTE for a strike price
of $1.00 per share exercisable on or before the fifth anniversary of the
Warrant and for one million shares of common stock of WSTE for a strike price
of $1.25 per share exercisable on or before the fifth anniversary of the
Warrant, all pursuant to those certain Warrants each dated January 31, 1997.
4. Matters relating to Southwest Bank Loan Agreement.
(a) WSTE and the Company agree that they will not amend, supplement,
increase, extend, renew, modify or waive any provisions of the Loan Agreement,
the Notes or any of the security documents or other documents executed in
connection with the Loan Agreement without the prior written consent of RKM and
TJF.
(b) The parties hereto recognize that pursuant to the Agreement
Regarding Purchase of Notes, Southwest Bank has granted to RKM and TJF the
right to remedy certain Events of Default (as defined in the Loan Agreement)
that extend beyond the grace periods granted to the Company. In addition, the
parties recognize that pursuant to the Agreement Regarding Purchase of Notes,
RKM and TJF have been granted the right to purchase the Notes from Southwest
Bank and receive all collateral therefor including, without limitation, the
stock of the Company. RKM and TJF agree that they will not exercise their
right to purchase the Notes prior to the expiration of the seven day grace
period for payment obligations as set forth in Section 11.01(a) of the Loan
Agreement or prior to the expiration of the 15 day grace period for other
defaults as set forth in Section 11.01(c) of the Loan Agreement without the
prior written consent of the Company and WSTE. RKM and TJF agree to give the
Company and WSTE notice simultaneously with any notice given by them to
Southwest Bank of their intention to cure or purchase the Notes as provided in
the Agreement Regarding Purchase of Notes. RKM and TJF agree that the Company
and WSTE will have the continuing right to cure any default or Event of Default
provided such cure is accepted by Southwest Bank at any time prior to the
earlier to occur of (x) RKM and TJF's notice to Southwest Bank of their intent
to cure or purchase the Notes or (y) the expiration of the time periods granted
by Southwest Bank to RKM and TJF in the Agreement Regarding Purchase of Notes
to cure or purchase the Notes.
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<PAGE> 3
(c) WSTE agrees that if RKM and/or TJF elect to remedy any Event of
Default and not purchase the Notes from Southwest Bank that WSTE shall be
liable to RKM and TJF for any funds expended by them to remedy such Events of
Default. Such indebtedness shall be due upon demand and shall bear interest at
the lesser of the maximum rate permitted by applicable law or the rate of
interest charged by Southwest Bank on the Notes plus two percent (2%). Such
obligations owing by WSTE shall be unsecured and fully subordinated to the
loans from Southwest Bank.
5. Agreements Between TJF and RKM Regarding Purchase of Notes and
Curing of Defaults.
(a) Notwithstanding any provision in the Loan Agreement or the
Agreement Regarding Purchase of Notes to the contrary, as between RKM and TJF,
TJF's maximum liability under his Guaranty to Southwest Bank shall be limited
to the lesser or twenty-five percent (25%) of all indebtedness and other
obligations owing under the Notes and the Loan Agreement and (ii)
$1,000,000.00.
(b) As between RKM and TJF, RKM will have the exclusive right to
determine whether or not to (i) cure any default or Event of Default under the
Loan Agreement pursuant to the terms of the Agreement Regarding Purchase of
Notes, (ii) purchase the Notes pursuant to the Agreement Regarding Purchase of
Notes, or (iii) take no action with respect to a default or Event of Default
under the Loan Agreement. TJF agrees that he will take no action with respect
to the Notes under the Agreement Regarding Purchase of Notes or otherwise
without the written consent of RKM.
(c) If RKM elects to cure a default or Event of Default or purchase
the Notes pursuant to the Agreement Regarding Purchase of Notes as between RKM
and TJF, TJF shall be required to join RKM in such curative action or purchase
of Notes provided TJF's liability therefor shall be limited to the lesser of
(i) twenty-five percent (25%) of the amounts required to cure or purchase the
Notes or (ii) $1,000,000.00 ("TJF Contribution). Notwithstanding the foregoing
provisions of Sections 5(b) and this Section 5(c), if RKM elects to cure a
default or an Event of Default instead of purchasing the Notes pursuant to the
Agreement Regarding Purchase of Notes, TJF shall have the right exercisable
within the permitted periods granted by Southwest Bank to RKM and TJF under the
Agreement Regarding Purchase of Notes to purchase 100 % of the Notes pursuant
to the Agreement Regarding Purchase of Notes provided, in such event, RKM will
be released from all liability under RKM's Guaranty and RKM shall receive the
RKM Collateral (as described and defined herein below) free and clear of any
claims by Southwest Bank or TJF.
(d) If RKM elects to purchase the Notes pursuant to the Agreement
Regarding Purchase of Notes and TJF contributes all funds necessary to fulfill
the TJF Contribution, the Notes and all collateral shall be owned by RKM and
TJF pro rata in accordance with the funds contributed by each of RKM and TJF
for the purchase of the Notes, provided however, that the stock of Weatherford
Enterra, Inc. and any other collateral or assets pledged or otherwise given by
RKM to Southwest Bank as security for the Guaranty of RKM ("RKM Collateral")
shall be returned to RKM as his sole property and TJF shall have no claim or
interest therein. Immediately after any such acquisition of the Notes, RKM and
TJF will use commercially reasonable efforts to agree upon a plan of
foreclosure, disposition and operation of the Notes and security. If RKM and
TJF cannot mutually agree on a plan of foreclosure, disposition and operation
of the Notes and security within 60 days
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<PAGE> 4
after the acquisition of the Notes, RKM shall have the right and option
exercisable within 15 days after the expiration of such 60 days to purchase
TJF's entire interest in the Notes and security for a price equal to the amount
funded by TJF for the purchase of such Notes without interest.
(e) Notwithstanding the provisions of Section 5(d) above, if prior to
the expiration of the 60 day period set forth in Section 5(d) and at any time
thereafter (provided RKM has not exercised his option to purchase TJF's
interest in the Notes and security as set forth in Section 5(d)), TJF presents
to RKM a transaction for the purchase by a bona fide financially capable third
party of all or substantially all of the collateral, security and other assets
that had been given as security for the Notes (excluding the RKM Collateral)
that would yield to RKM a return of the RKM Investment (as defined below) plus
the IRR Amount (as defined below), RKM shall be obligated to approve such
transaction and use his commercially reasonable efforts with TJF to close such
transaction; provided, however, that if such transaction does not close for any
reason other than reasons in the sole control of RKM within 90 days after such
transaction has been proposed to RKM, RKM shall not be obligated to approve any
such other transaction proposed by TJF except in RKM's sole discretion. As
used herein the term "IRR Amount" shall mean, as of the date of determination
the amount which after giving effect to the payments and receipts described
below would yield an annual pretax rate of return to RKM on the RKM Investment
(as hereinafter defined) equal to the rate of 12 % per anum as of such date of
determination. For purposes of determining the IRR Amount only the following
investments and receipts shall be taken into account on the respective dates
made or received by RKM, as applicable and without duplication: (i) the "RKM
Investment" which shall mean the sum of (aa) $5,125,000 deemed made as of
1/27/97 plus (bb) all amounts in excess of $4,000,000 funded by RKM for the
purchase of the Notes on the date actually funded by RKM; (ii) all principal
and interest payments received by RKM in respect of the Notes; and (iii) all
dividends and distributions whether in cash or other property received by RKM
from and after 1/31/97 in respect of stock or other securities of WSTE owned by
RKM as of 1/31/97.
(f) TJF and RKM agree to be bound by the terms of this Agreement with
respect to the Notes and security jointly purchased and except for the RKM
Collateral each RKM and TJF waive any rights to proceed directly against any
security or collateral for the Notes independent of one another and waive any
rights to partition the Notes or any security or collateral.
(g) If RKM has elected to purchase the Notes pursuant to the
Agreement Regarding Purchase of Notes and TJF fails to fund all or any part of
the TJF Contribution, RKM shall have the right, but not the obligation, to fund
all or any portion of the amounts not so funded by TJF necessary to purchase
the Notes from Southwest Bank and to the extent RKM funds any portion of the
purchase price of the Notes that should have been funded by TJF, RKM shall have
a claim against TJF for the amount of such shortfall. The amount of any such
shortfall shall be payable by TJF to RKM upon demand and shall bear interest
from the date that such contribution should have been made until paid at the
lesser of the maximum rate permitted by applicable law and ten percent (10%)
per annum; provided that RKM shall be subject to any duties or obligations to
mitigate the amount of such shortfall as may be imposed by applicable law.
(h) WSTE and the Company hereby consent to the agreements between TJF
and RKM relating to the purchase of the Notes and the disposition of the
collateral set forth in this Section 5 and agree that neither WSTE, the
Company, nor any of their subsidiaries will take any action to
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<PAGE> 5
delay, obstruct, or impair the acquisition of the Notes and collateral by RKM
and/or TJF in accordance with the terms of this Agreement or the Agreement
Regarding Purchase of Notes.
6. Specific Performance.
Each party is hereby authorized to demand specific performance of
this Agreement at any time when any other of them shall have failed to comply
with any of the provisions of this Agreement applicable to it. Each party
irrevocably waives any defense based on the adequacy of a remedy at law, which
might be asserted as a bar to such remedy of specific performance.
7. Representations and Warranties.
Each party hereto severally represents and warrants to the other
parties hereto that (a) such party's execution, delivery and performance of
this Agreement has been duly authorized by all necessary corporate or
institutional action required by such party and (b) this Agreement has been
duly executed and delivered by such party and constitutes such party's legal,
valid and binding obligations enforceable against such party in accordance with
its terms (except to the extent that such enforceability may be limited by
applicable bankruptcy, reorganization, liquidation, insolvency, moratorium,
principles of equity (including, without limitation, equitable subordination)
or similar laws affecting creditor's rights generally.
8. No Third-Party Beneficiaries.
This Agreement is solely for the benefit of the parties hereto,
their respective affiliates and their respective heirs, legal representatives,
successors and assigns permitted under this Agreement and no provisions of this
Agreement shall be deemed to confer upon any other persons or entities any
remedy, claim, liability reimbursement, cause of action or other right.
9. Assignability; No Partnership.
Neither WSTE nor the Company shall transfer or assign any of its
rights in, to or under this Agreement without the prior written consent of RKM
and TJF. Neither RKM nor TJF shall voluntarily transfer or assign any of their
respective rights in, to or under this Agreement prior to the purchase of the
Notes by either or both of them without the consent of WSTE and the Company,
which consent will not be unreasonably withheld nor shall RKM nor TJF make any
such voluntary transfer at any time of this Agreement in effect without the
consent of the other. Except as provided above, this Agreement shall bind and
inure to the benefit of the heirs, legal representatives, successors and
assigns of the parties hereto. Nothing contained in this Agreement shall be
construed to constitute any of the parties hereto as partners, joint venturers,
co-owners or otherwise as participants in a joint undertaking.
10. Further Assurances.
Each party hereto will, upon request of any other party, from
time to time execute and deliver or cause to be executed and delivered such
further instruments and do and cause to be done
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<PAGE> 6
such further acts that may be reasonably necessary to carry out the express
provisions of this Agreement.
11. Amendments.
The provisions of this Agreement may be amended or waived only by
an instrument in writing signed by the parties hereto; provided, however, that
the provisions of Section 5 of this Agreement may be amended or waived by TJF
and RKM without joinder of the Company or WSTE.
12. Notices.
Any Notice ("Notice) or other communication permitted or required
to be given hereunder shall be in writing and given at the respective addresses
set forth under the signatures of the parties hereto, or to such other address
of which the party receiving the same shall have given Notice in accordance
with this Section. A Notice shall be deemed given when (i) hand delivered to
the address set forth for such party, (ii) transmitted by facsimile to the
facsimile number set forth under the signature of such party or (iii) four (4)
days after it is deposited in the United States mail, postage prepaid, return
receipt requested.
13. Applicable Law Venue; Service of Process.
This Agreement shall be governed by and construed in accordance
with the laws of the State of Texas and the applicable laws of the United
States of America. This Agreement has been entered into in Harris County,
Texas, and it shall be performable for all purposes in Harris County, Texas.
The venue of, and provisions regarding service of process in connection with
any action or proceeding hereunder shall be determined as provided in the Loan
Agreement.
14. Headings.
The headings and captions used in this Agreement are for
convenience only and shall not affect the interpretation of this Agreement.
15. Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
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<PAGE> 7
16. Severability.
Any provision of this Agreement held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate the
remainder of this Agreement, and the effect thereof shall be confined to the
provision held to be invalid or illegal.
/s/ Robert K. Moses
---------------------------------------
Robert K. Moses, Jr.
Address:
-------------------------------
---------------------------------------
---------------------------------------
Facsimile No.
--------------------------
/s/ Thomas J. Fatjo
---------------------------------------
Thomas J. Fatjo, Jr.
Address:
-------------------------------
---------------------------------------
---------------------------------------
Facsimile No.
--------------------------
TRANSAMERICAN WASTE OF HOUSTON, INC.
By: /s/ Lance C. Ruud
----------------------------------
Lance C. Ruud
Vice President
Address:
-------------------------------
---------------------------------------
---------------------------------------
Facsimile No.
--------------------------
TRANSAMERICAN WASTE INDUSTRIES, INC.
By: /s/ Lance C. Ruud
----------------------------------
Lance C. Ruud
Senior Vice President and Chief
Financial Officer
Address:
-------------------------------
---------------------------------------
---------------------------------------
Facsimile No.
--------------------------
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EXHIBIT 2
THE SECURITIES REPRESENTED BY THIS WARRANT AND THE COMMON STOCK ISSUABLE
THEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW AND,
ACCORDINGLY, THE SECURITIES REPRESENTED BY THIS WARRANT MAY NOT BE RESOLD,
PLEDGED, OR OTHERWISE TRANSFERRED, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER, OR IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER, THE
SECURITIES ACT AND IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS.
WARRANT
to Purchase Common Stock of
TRANSAMERICAN WASTE INDUSTRIES, INC.
Expiring on January 31, 2002
This Common Stock Purchase Warrant (the "Warrant") certifies that for
value received, Robert K. Moses, Jr. (the "Holder") or its assigns, is entitled
to subscribe for and purchase from the Company (as hereinafter defined), in
whole or in part, 2,000,000 shares of duly authorized, validly issued, fully
paid and nonassessable shares of Common Stock (as hereinafter defined) at an
initial Exercise Price (as hereinafter defined) per share of $1.00, subject,
however, to the provisions and upon the terms and conditions hereinafter set
forth. The number of Warrants (as hereinafter defined), the number of shares
of Common Stock purchasable hereunder, and the Exercise Price therefor are
subject to adjustment as hereinafter set forth. This Warrant and all rights
hereunder shall expire at 5:00 p.m., Houston, Texas time, on January 31, 2002.
As used herein, the following terms shall have the meanings set forth
below:
"Company" shall mean TransAmerican Waste Industries, Inc., a Delaware
corporation, and shall also include any successor thereto with respect to the
obligations hereunder, by merger, consolidation or otherwise.
"Common Stock" shall mean and include the Company's Common Stock, par
value $0.001 per share, authorized on the date of the original issue of this
Warrant and shall also include (i) in case of any reorganization,
reclassification, consolidation, merger, share exchange or sale, transfer or
other disposition of assets of the character referred to in Section 3.5 hereof,
the stock, securities provided for in such Section 3.5, and (ii) any other
shares of common stock of the Company into which such shares of Common Stock
may be converted.
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"Exercise Price" shall mean the initial purchase price of $1.00 per
share of Common Stock payable upon exercise of the Warrants, as adjusted from
time to time pursuant to the provisions hereof.
"Market Price" for any day, when used with reference to Common Stock,
shall mean the price of said Common Stock determined as follows: (x) the last
reported sale price for the Common Stock on such day on the principal
securities exchange on which the Common Stock is listed or admitted to trading
or if no such sale takes place on such date, the average of the closing bid and
asked prices thereof as officially reported, or, if not so listed or admitted
to trading on any securities exchange, the last sale price for the Common Stock
on the National Association of Securities Dealers SmallCap Market on such date,
or, if there shall have been no trading on such date or if the Common Stock
shall not be listed on such system, the average of the closing bid and asked
prices in the over-the-counter market as furnished by any NASD member firm
selected from time to time by the Company for such purpose, in each such case,
unless otherwise provided herein, averaged over a period of ten (10)
consecutive Trading Days prior to the date as of which the determination is to
be made; or (y) if the Common Stock shall not be listed or admitted to trading
as provided in clause (x) above, the fair market value of the Common Stock as
determined in good faith by the Board of Directors of the Company.
"Outstanding," when used with reference to Common Stock, shall mean
(except as otherwise expressly provided herein) at any date as of which the
number of shares thereof is to be determined, all issued shares of Common
Stock, except shares then owned or held by or for the account of the Company.
"Trading Days" shall mean any days during the course of which the
principal securities exchange on which the Common Stock is listed or admitted
to trading is open for the exchange of securities.
"Warrant" shall mean the right upon exercise to purchase one Warrant
Share.
"Warrant Shares" shall mean the shares of Common Stock purchased or
purchasable by the holder hereof upon the exercise of the Warrants.
ARTICLE I
Exercise of Warrants
1.1 Method of Exercise. The Warrants represented hereby may be
exercised by the holder hereof, in whole or in part, at any time and from time
to time on or after the date hereof until 5:00 p.m., Houston, Texas time, on
January 31, 2002. To exercise the Warrants, the holder hereof shall deliver to
the Company, at the Warrant Office designated in Section 2.1 hereof, (i) a
written notice in the form of the Subscription Notice attached as an exhibit
hereto, stating therein
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the election of such holder to exercise the Warrants in the manner provided in
the Subscription Notice; (ii) payment in full of the Exercise Price (A) in cash
or by bank check for all Warrant Shares purchased hereunder, or (B) through a
"cashless" or "net-issue" exercise of each such Warrant ("Cashless Exercise");
the holder shall exchange each Warrant subject to a Cashless Exercise for that
number of Warrant Shares determined by multiplying the number of Warrant Shares
issuable hereunder by a fraction, the numerator of which shall be the
difference between (x) the Market Price and (y) the Exercise Price for each
such Warrant, and the denominator of which shall be the Market Price; the
Subscription Notice shall set forth the calculation upon which the Cashless
Exercise is based, or (C) a combination of (A) and (B) above; and (iii) this
Warrant. The Warrants shall be deemed to be exercised on the date of receipt
by the Company of the Subscription Notice, accompanied by payment for the
Warrant Shares and surrender of this Warrant, as aforesaid, and such date is
referred to herein as the "Exercise Date". Upon such exercise, the Company
shall, as promptly as practicable and in any event within ten (10) business
days, issue and deliver to such holder a certificate or certificates for the
full number of the Warrant Shares purchased by such holder hereunder, and
shall, unless the Warrants have expired, deliver to the holder hereof a new
Warrant representing the number of Warrants, if any, that shall not have been
exercised, in all other respects identical to this Warrant. As permitted by
applicable law, the Person in whose name the certificates for Common Stock are
to be issued shall be deemed to have become a holder of record of such Common
Stock on the Exercise Date and shall be entitled to all of the benefits of such
holder on the Exercise Date, including without limitation the right to receive
dividends and other distributions for which the record date falls on or after
the Exercise Date and to exercise voting rights.
1.2 Expenses and Taxes. The Company shall pay all expenses, and
taxes (including, without limitation, all documentary, stamp, transfer or other
transactional taxes) other than income taxes attributable to the preparation,
issuance or delivery of the Warrants and of the shares of Common Stock issuable
upon exercise of the Warrants.
1.3 Reservation of Shares. The Company shall reserve at all times
so long as the Warrants remain outstanding, free from preemptive rights, out of
its treasury Common Stock or its authorized but unissued shares of Common
Stock, or both, solely for the purpose of effecting the exercise of the
Warrants, a sufficient number of shares of Common Stock to provide for the
exercise of the Warrants.
1.4 Valid Issuance. All shares of Common Stock that may be issued
upon exercise of the Warrants will, upon issuance by the Company, be duly and
validly issued, fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issuance thereof and, without limiting the
generality of the foregoing, the Company shall take no action or fail to take
any action which will cause a contrary result (including, without limitation,
any action that would cause the Exercise Price to be less than the par value,
if any, of the Common Stock).
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1.5 Acknowledgment of Rights. At the time of the exercise of the
Warrants in accordance with the terms hereof and upon the written request of
the holder hereof, the Company will acknowledge in writing its continuing
obligation to afford to such holder any rights (including, without limitation,
any right to registration of the Warrant Shares) to which such holder shall
continue to be entitled after such exercise in accordance with the provisions
of this Warrant; provided, however, that if the holder hereof shall fail to
make any such request, such failure shall not affect the continuing obligation
of the Company to afford to such holder any such rights.
1.6 No Fractional Shares. The Company shall not be required to
issue fractional shares of Common Stock on the exercise of this Warrant. If
more than one Warrant shall be presented for exercise at the same time by the
same holder, the number of full shares of Common Stock which shall be issuable
upon such exercise shall be computed on the basis of the aggregate number of
whole shares of Common Stock purchasable on exercise of the Warrants so
presented. If any fraction of a share of Common Stock would, except for the
provisions of this Section 1.6, be issuable on the exercise of this Warrant,
the Company shall pay an amount in cash calculated by it to be equal to the
Market Price of one share of Common Stock at the time of such exercise
multiplied by such fraction computed to the nearest whole cent.
ARTICLE II
Transfer
2.1 Warrant Office. The Company shall maintain an office for
certain purposes specified herein (the "Warrant Office"), which office shall
initially be the Company's offices at 314 North Post Oak Lane, Houston Texas
77024, and may subsequently be such other office of the Company or of any
transfer agent of the Common Stock in the continental United States as to which
written notice has previously been given to the holder hereof. The Company
shall maintain, at the Warrant Office, a register for the Warrants in which the
Company shall record the name and address of the Person in whose name this
Warrant has been issued, as well as the name and address of each permitted
assignee of the rights of the registered owner hereof.
2.2 Ownership of Warrants. The Company may deem and treat the
Person in whose name the Warrants are registered as the holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by anyone
other than the Company) for all purposes and shall not be affected by any
notice to the contrary until presentation of this Warrant for registration of
transfer as provided in this Article II. Notwithstanding the foregoing, the
Warrants represented hereby, if properly assigned in compliance with this
Article II, may be exercised by an assignee for the purchase of Warrant Shares
without having a new Warrant issued.
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2.3 Restrictions on Transfer of Warrants. The Company agrees to
maintain at the Warrant Office books for the registration and transfer of the
Warrants. Subject to the restrictions on transfer of the Warrants in this
Section 2.3, the Company, from time to time, shall register the transfer of the
Warrants in such books upon surrender of this Warrant at the Warrant Office
properly endorsed or accompanied by appropriate instruments of transfer and
written instructions for transfer satisfactory to the Company. Upon any such
transfer and upon payment by the holder or its transferee of any applicable
transfer taxes, new Warrants shall be issued to the transferee and the
transferor (as their respective interests may appear) and the surrendered
Warrants shall be cancelled by the Company. The Company shall pay all taxes
(other than securities transfer taxes or income taxes) and all other expenses
and charges payable in connection with the transfer of the Warrants pursuant to
this Section 2.3.
2.3.1 Restrictions in General. The holder of the Warrants
agrees that it will neither (i) transfer the Warrants prior to delivery to the
Company of written notice of such transfer, nor (ii) transfer such Warrant
Shares prior to delivery to the Company of written notice of such transfer, or
until registration of such Warrant Shares under the Securities Act and any
applicable state securities or blue sky laws has become effective.
2.4 Compliance with Securities Laws. Subject to the terms of the
Registration Rights Agreement between the Holder and the Company dated as of
the date hereof and notwithstanding any other provisions contained in this
Warrant, the holder hereof understands and agrees that the following
restrictions and limitations shall be applicable to all Warrant Shares and to
all resales or other transfers thereof pursuant to the Securities Act:
2.4.1 The holder hereof agrees that the Warrant Shares
shall not be sold or otherwise transferred unless the Warrant Shares are
registered under the Securities Act and applicable state securities or blue sky
laws or are exempt therefrom.
2.4.2 A legend in substantially the following form will be
placed on the certificate(s) evidencing the Warrant Shares:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE
SECURITIES LAW AND, ACCORDINGLY, THE SECURITIES REPRESENTED BY
THIS CERTIFICATE MAY NOT BE RESOLD, PLEDGED, OR OTHERWISE
TRANSFERRED, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER, OR IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER, THE SECURITIES ACT AND IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS."
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2.4.3 Stop transfer instructions will be imposed with
respect to the Warrant Shares so as to restrict resale or other transfer
thereof, subject to this Section 2.4.
ARTICLE III
Anti-Dilution
3.1 Anti-Dilution Provisions. The Exercise Price shall be subject
to adjustment from time to time as hereinafter provided. Upon each adjustment
of the Exercise Price, the holder of this Warrant shall thereafter be entitled
to purchase, at the Exercise Price resulting from such adjustment, the number
of shares of Common Stock obtained by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of shares purchasable
pursuant hereto immediately prior to such adjustment and dividing the product
thereof by the Exercise Price resulting from such adjustment.
3.2 Adjustment of Exercise Price Upon Issuance of Common Stock.
3.2.1 (A) If and whenever after the date hereof the
Company shall issue or sell any Common Stock for no consideration or for a
consideration per share less than the Exercise Price, then, forthwith upon such
issue or sale, the Exercise Price shall be reduced (but not increased, except
as otherwise specifically provided in Section 3.2.2(C) hereof), to the price
(calculated to the nearest one-ten thousandth of a cent) determined by dividing
(x) an amount equal to the sum of (i) the aggregate number of shares of Common
Stock outstanding immediately prior to such issue or sale multiplied by then
existing Exercise Price plus (ii) the consideration received by the Company
upon such issue or sale by (y) the aggregate number of shares of Common Stock
outstanding immediately after such issue or sale. Notwithstanding the
foregoing and in lieu thereof, in the event the Company issues additional
shares pursuant to Section 2.2 of that certain Registration Rights Agreement of
even date herewith among the Company, Sanders Morris Mundy Inc. and certain
other persons named on Exhibit A thereto, then the Exercise Price shall be
reduced to the price determined by dividing the then existing Exercise Price by
one and one-half (1.5).
(B) Notwithstanding the provisions of this
Section 3.2, no adjustment shall be made in the Exercise Price in the event
that the Company issues, in one or more transactions, (i) Common Stock or
convertible securities upon exercise of any options issued to officers,
directors or employees of the Company pursuant to a stock option plan or an
employment, severance or consulting agreement as now or hereafter in effect, in
each case approved by the Board of Directors (provided that the aggregate
number of shares of Common Stock which may be issuable, including options
issued prior to the date hereof, under all such employee plans and agreements
shall at no time exceed the number of such shares of Common Stock that are
issuable under currently effective employee plans and agreements); (ii) Common
Stock upon exercise of any stock purchase warrant or option (other than the
options referred to
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in clause (i) above) or other convertible security outstanding on the date
hereof; or (iii) Common Stock issued as consideration in, or in connection
with, acquisitions by the Company. In addition, for purposes of calculating
any adjustment of the Exercise Price as provided in this Section 3.2, all of
the shares of Common Stock issuable pursuant to any of the foregoing shall be
assumed to be outstanding prior to the event causing such adjustment to be
made.
3.2.2 For purposes of this Section 3.2, the following
Sections 3.2.2(A) to 3.2.2(E) inclusive, shall be applicable:
(A) Issuance of Rights or Options. In case at any time
after the date hereof the Company shall in any manner grant (whether
directly or by assumption in a merger or otherwise) any rights to
subscribe for or to purchase, or any options for the purchase of,
Common Stock or any stock or securities convertible into or
exchangeable for Common Stock (such convertible or exchangeable stock
or securities being herein called "Convertible Securities"), whether
or not such rights or options or the right to convert or exchange any
such Convertible Securities are immediately exercisable, and the price
per share for which shares of Common Stock are issuable upon the
exercise of such rights or options or upon conversion or exchange of
such Convertible Securities (determined by dividing (i) the total
amount, if any, received or receivable by the Company as consideration
for the granting of such rights or options, plus the minimum aggregate
amount of additional consideration, if any, payable to the Company
upon the exercise of such rights or options, or plus, in the case of
such rights or options that relate to Convertible Securities, the
minimum aggregate amount of additional consideration, if any, payable
upon the issue or sale of such Convertible Securities and upon the
conversion or exchange thereof, by (ii) the total maximum number of
shares of Common Stock issuable upon the exercise of such rights or
options or upon the conversion or exchange of all such Convertible
Securities issuable upon the exercise of such rights or options) shall
be less than the Exercise Price in effect as of the date of granting
such rights or options, then the total maximum number of shares of
Common Stock issuable upon the exercise of such rights or options or
upon conversion or exchange of all such Convertible Securities
issuable upon the exercise of such rights or options shall be deemed
to be outstanding as of the date of the granting of such rights or
options and to have been issued for such price per share, with the
effect on the Exercise Price specified in Section 3.2.1 hereof.
Except as provided in Section 3.2.2 hereof, no further adjustment of
the Exercise Price shall be made upon the actual issuance of such
Common Stock or of such Convertible Securities upon exercise of such
rights or options or upon the actual issuance of such Common Stock
upon conversion or exchange of such Convertible Securities.
(B) Change in Option Price or Conversion Rate. Upon the
happening of any of the following events, namely, if the purchase
price provided for in any right or option referred to in Section
3.2.2, the additional consideration, if any, payable upon the
conversion or exchange of any Convertible Securities referred to in
Section 3.2.2, or the
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rate at which any Convertible Securities referred to in Section 3.2.2,
are convertible into or exchangeable for Common Stock shall change
(other than under or by reason of provisions designed to protect
against dilution), the Exercise Price then in effect hereunder shall
forthwith be readjusted (increased or decreased, as the case may be)
to the Exercise Price that would have been in effect at such time had
such rights, options or Convertible Securities still outstanding
provided for such changed purchase price, additional consideration or
conversion rate, as the case may be, at the time initially granted,
issued or sold. On the expiration of any such option or right
referred to in Section 3.2.2, or on the termination of any such right
to convert or exchange any such Convertible Securities referred to in
Section 3.2.2, the Exercise Price then in effect hereunder shall
forthwith be readjusted (increased or decreased, as the case may be)
to the Exercise Price that would have been in effect at the time of
such expiration or termination had such right, option or Convertible
Securities, to the extent outstanding immediately prior to such
expiration or termination, never been granted, issued or sold, and the
Common Stock issuable thereunder shall no longer be deemed to be
outstanding. If the purchase price provided for in Section 3.2.2 or
the rate at which any Convertible Securities referred to in Section
3.2.2 reduced at any time under or by reason of provisions with
respect thereto designed to protect against dilution, then in case of
the delivery of Common Stock upon the exercise of any such right or
option or upon conversion or exchange of any such Convertible
Securities, the Exercise Price then in effect hereunder shall, if not
already adjusted, forthwith be adjusted to such amount as would have
obtained had such right, option or Convertible Securities never been
issued as to such Common Stock and had adjustments been made upon the
issuance of the Common Stock delivered as aforesaid, but only if as a
result of such adjustment the Exercise Price then in effect hereunder
is thereby reduced.
(C) Consideration for Stock. In case at any time Common
Stock or Convertible Securities or any rights or options to purchase
any such Common Stock or Convertible Securities shall be issued or
sold for cash, the consideration therefor shall be deemed to be the
amount received by the Company therefor. In case at any time any
Common Stock, Convertible Securities or any rights or options to
purchase any such Common Stock or Convertible Securities shall be
issued or sold for consideration other than cash, the amount of the
consideration other than cash received by the Company shall be deemed
to be the fair value of such consideration, as determined reasonably
and in good faith by the Board of Directors of the Company. In case
at any time any Common Stock, Convertible Securities or any rights or
options to purchase any Common Stock or Convertible Securities shall
be issued in connection with any merger or consolidation in which the
Company is the surviving corporation, the amount of consideration
received therefor shall be deemed to be the fair value, as determined
reasonably and in good faith by the Board of Directors of the Company,
of such portion of the assets and business of the nonsurviving
corporation as such Board of Directors may determine to be
attributable to such Common Stock, Convertible Securities, rights or
options as the case may be. In case at any time any rights or options
to purchase any shares of Common Stock or Convertible
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Securities shall be issued in connection with the issuance and sale of
other securities of the Company, together consisting of one integral
transaction in which no consideration is allocated to such rights or
options by the parties, such rights or options shall be deemed to have
been issued with consideration.
(D) Record Date. In the case the Company shall take a
record of the holders of its Common Stock for the purpose of entitling
them (i) to receive a dividend or other distribution payable in Common
Stock or Convertible Securities, or (ii) to subscribe for or purchase
Common Stock or Convertible Securities, then such record date shall be
deemed to be the date of the issuance or sale of the Common Stock or
Convertible Securities deemed to have been issued or sold as a result
of the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription
or purchase, as the case may be.
(E) Treasury Shares. The number of shares of Common
Stock outstanding at any given time shall not include shares owned
directly by the Company in treasury, and the disposition of any such
shares shall be considered an issuance or sale of Common Stock for the
purpose of this Section 3.2.
3.3 Stock Dividends. In case the Company shall declare a dividend
or make any other distribution upon any shares of the Company, payable in
Common Stock or Convertible Securities, any Common Stock or Convertible
Securities, as the case may be, issuable in payment of such dividend or
distribution shall be deemed to have been issued or sold without consideration.
3.4 Stock Splits and Reverse Splits. In the event that the
Company shall at any time subdivide its outstanding shares of Common Stock into
a greater number of shares, the Exercise Price in effect immediately prior to
such subdivision shall be proportionately reduced and the number of Warrant
Shares purchasable pursuant to this Warrant immediately prior to such
subdivision shall be proportionately increased, and conversely, in the event
that the outstanding shares of Common stock shall at any time be combined into
a smaller number of shares, the Exercise Price in effect immediately prior to
such combination shall be proportionately increased and the number of Warrant
Shares purchasable upon the exercise of this Warrant immediately prior to such
combination shall be proportionately reduced. Except as provided in this
Section 3.4, no adjustment in the Exercise Price and no change in the number of
Warrant Shares purchasable shall be made under this Article III as a result of
or by reason of any such subdivision or combination.
3.5 Reorganizations and Asset Sales. If any capital
reorganization or reclassification of the capital stock of the Company, or any
consolidation, merger or share exchange of the Company with another Person, or
the sale, transfer or other disposition of all or substantially all of its
assets to another Person shall be effected in such a way that a holder of
Common Stock of
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the Company shall be entitled to receive capital stock, securities or assets
with respect to or in exchange for their shares, then the following provisions
shall apply:
3.5.1 As a condition of such reorganization,
reclassification, consolidation, merger, share exchange, sale, transfer or
other disposition (except as otherwise provided below in this Section 3.5),
lawful and adequate provisions shall be made whereby the holder of Warrants
shall thereafter have the right to purchase and receive upon the terms and
conditions specified in this Warrant and in lieu of the Warrant Shares
immediately theretofore receivable upon the exercise of the rights represented
hereby, such shares of capital stock, securities or assets as may be issued or
payable with respect to or in exchange for a number of outstanding shares of
such Common Stock equal to the number of Warrant Shares immediately theretofore
so receivable had such reorganization, reclassification, consolidation, merger,
share exchange or sale not taken place, and in any such case appropriate
provision reasonably satisfactory to such holder shall be made with respect to
the rights and interests of such holder to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise
Price and of the number of Warrant Shares receivable upon the exercise) shall
thereafter be applicable, as nearly as possible, in relation to any shares of
capital stock, securities or assets thereafter deliverable upon the exercise of
Warrants.
3.5.2 In the event of a merger, share exchange or
consolidation of the Company with or into another Person as a result of which a
number of shares of common stock or its equivalent of the successor Person
greater or lesser than the number of shares of Common Stock outstanding
immediately prior to such merger, share exchange or consolidation are issuable
to holders of Common Stock, then the Exercise Price in effect immediately prior
to such merger, share exchange or consolidation shall be adjusted in the same
manner as though there were a subdivision or combination of the outstanding
shares of Common Stock.
3.5.3 The Company shall not effect any such consolidation,
merger, share exchange, sale, transfer or other disposition unless prior to or
simultaneously with the consummation thereof the successor Person (if other
than the Company) resulting from such consolidation, share exchange or merger
or the Person purchasing or otherwise acquiring such assets shall have assumed
by written instrument executed and mailed or delivered to the holder hereof at
the last address of such holder appearing on the books of the Company the
obligation to deliver to such holder such shares of capital stock, securities
or assets as, in accordance with the foregoing provisions, such holder may be
entitled to receive, and all other liabilities and obligations of the Company
hereunder. Upon written request by the holder hereof, such successor Person
will issue a new Warrant revised to reflect the modifications in this Warrant
effected pursuant to this Section 3.5.
3.5.4 If a purchase, tender or exchange offer is made to
and accepted by the holders of 50% or more of the outstanding shares of Common
Stock, the Company shall not effect
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any consolidation, merger, share exchange or sale, transfer or other
disposition of all or substantially all of the Company's assets with the Person
having made such offer or with any affiliate of such Person, unless prior to
the consummation of such consolidation, merger, share exchange, sale, transfer
or other disposition the holder hereof shall have been given a reasonable
opportunity to then elect to receive upon the exercise of the Warrants either
the capital stock, securities or assets then issuable with respect to the
Common Stock or the capital stock, securities or assets, or the equivalent,
issued to previous holders of the Common Stock in accordance with such offer.
3.6 Adjustment for Asset Distribution. If the Company declares a
dividend or other distribution payable to all holders of shares of Common Stock
in evidences of indebtedness of the Company or other assets of the Company
(including, cash (other than regular cash dividends declared by the Board of
Directors), capital stock (other than Common Stock, Convertible Securities or
options or rights thereto) or other property), the Exercise Price in effect
immediately prior to such declaration of such dividend or other distribution
shall be reduced by an amount equal to the amount of such dividend or
distribution payable per share of Common Stock, in the case of a cash dividend
or distribution, or by the fair value of such dividend or distribution per
share of Common Stock (as reasonably determined in good faith by the Board of
Directors of the Company), in the case of any other dividend or distribution.
Such reduction shall be made whenever any such dividend or distribution is made
and shall be effective as of the date as of which a record is taken for purpose
of such dividend or distribution or, if a record is not taken, the date as of
which holders of record of Common Stock entitled to such dividend or
distribution are determined.
3.7 De Minimis Adjustments. No adjustment in the number of shares
of Common Stock purchasable hereunder shall be required unless such adjustment
would require an increase or decrease of at least one share of Common Stock
purchasable upon an exercise of each Warrant and no adjustment in the Exercise
Price shall be required unless such adjustment would require an increase or
decrease of at least $0.01 in the Exercise Price; provided, however, that any
adjustments which by reason of this Section 3.7 are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations shall be made to the nearest full share or nearest one
hundredth of a dollar, as applicable.
3.8 Notice of Adjustment. Whenever the Exercise Price or the
number of Warrant Shares issuable upon the exercise of the Warrants shall be
adjusted as herein provided, or the rights of the holder hereof shall change by
reason of other events specified herein, the Company shall compute the adjusted
Exercise Price and the adjusted number of Warrant Shares in accordance with the
provisions hereof and shall prepare an Officer's Certificate setting forth the
adjusted Exercise Price and the adjusted number of Warrant Shares issuable upon
the exercise of the Warrants or specifying the other shares of stock,
securities or assets receivable as a result of such change in rights, and
showing in reasonable detail the facts and calculations upon which such
adjustments or other changes are based. The Company shall cause to be mailed
to the holder
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hereof copies of such Officer's Certificate together with a notice stating that
the Exercise Price and the number of Warrant Shares purchasable upon exercise
of the Warrants have been adjusted and setting forth the adjusted Exercise
Price and the adjusted number of Warrant Shares purchasable upon the exercise
of the Warrants.
3.9 Notifications to Holders. In case at any time the Company
proposes:
(i) to declare any dividend upon its Common Stock payable
in capital stock or make any special dividend or other distribution
(other than cash dividends) to the holders of its Common Stock;
(ii) to offer for subscription pro rata to all of the
holders of its Common Stock any additional shares of capital stock of
any class or other rights;
(iii) to effect any capital reorganization, or
reclassification of the capital stock of the Company, or
consolidation, merger or share exchange of the Company with another
Person, or sale, transfer or other disposition of all or substantially
all of its assets; or
(iv) to effect a voluntary or involuntary dissolution,
liquidation or winding up of the Company,
then, in any one or more of such cases, the Company shall give the holder
hereof (a) at least 10 days' (but not more than 90 days') prior written notice
of the date of which the books of the Company shall close or a record shall be
taken for such dividend, distribution or subscription rights or for determining
rights to vote in respect of such issuance, reorganization, reclassification,
consolidation, merger, share exchange, sale, transfer, disposition,
dissolution, liquidation or winding up, and (b) in the case of any such
issuance, reorganization, reclassification, consolidation, merger, share
exchange, sale, transfer, disposition, dissolution, liquidation or winding up,
at least 10 days' (but not more than 90 days') prior written notice of the date
when the same shall take place. Such notice in accordance with the foregoing
clause (a) shall also specify, in the case of any such dividend, distribution
or subscription rights, the date on which the holders of Common Stock shall be
entitled thereto, and such notice in accordance with the foregoing clause (b)
shall also specify the date on which the holders of Common Stock shall be
entitled to exchange their Common Stock, as the case may be, for securities or
other property deliverable upon such reorganization, reclassification,
consolidation, merger, share exchange, sale, transfer, disposition,
dissolution, liquidation or winding up, as the case may be.
3.10 Company to Prevent Dilution. If any event or condition occurs
as to which other provisions of this Article III are not strictly applicable or
if strictly applicable would not fairly protect the exercise or purchase rights
of the Warrants evidenced hereby in accordance with the essential intent and
principles of such provisions, or that might materially and adversely affect
the exercise or purchase rights of the holder hereof under any provisions of
this Warrant, then the
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Company shall make such adjustments in the application of such provisions, in
accordance with such essential intent and principles, so as to protect such
exercise and purchase rights as aforesaid, and any adjustments necessary with
respect to the Exercise Price and the number of Warrant Shares purchasable
hereunder so as to preserve the rights of the holder hereunder. In no event
shall any such adjustment have the effect of increasing the Exercise Price as
otherwise determined pursuant to this Article III except in the event of a
combination of shares of the type contemplated in Section 3.4 hereof, and then
in no event to an amount greater than the Exercise Price as adjusted pursuant
to Section 3.4 hereof.
ARTICLE IV
Miscellaneous
4.1 Entire Agreement. This Warrant contains the entire agreement
between the holder hereof and the Company with respect to the Warrant Shares
purchasable upon exercise hereof and the related transactions and supersedes
all prior arrangements or understandings with respect thereto.
4.2 Governing Law. This warrant shall be governed by and
construed in accordance with the laws of the State of Delaware.
4.3 Waiver and Amendment. Any term or provision of this Warrant
may be waived at any time by the party which is entitled to the benefits
thereof and any term or provision of this Warrant may be amended or
supplemented at any time by agreement of the holder hereof and the Company,
except that any waiver of any term or condition, or any amendment or
supplementation, of this Warrant shall be in writing. A waiver of any breach
or failure to enforce any of the terms or conditions of this Warrant shall not
in any way effect, limit or waive a party's rights hereunder at any time to
enforce strict compliance thereafter with every term or condition of this
Warrant.
4.4 Illegality. In the event that any one or more of the
provisions contained in this Warrant shall be determined to be invalid, illegal
or unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in any other respect and the remaining
provisions of this Warrant shall not, at the election of the party for whom the
benefit of the provision exists, be in any way impaired.
4.5 Copy of Warrant. A copy of this Warrant shall be filed among
the records of the Company.
4.6 Notice. Any notice or other document required or permitted to
be given or delivered to the holder hereof shall be in writing and delivered
at, or sent by certified or registered mail to such holder at, the last address
shown on the books of the Company maintained at the Warrant Office for the
registration of this Warrant or at any more recent address of which the
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<PAGE> 14
holder hereof shall have notified the Company in writing. Any notice or other
document required or permitted to be given or delivered to the Company, other
than such notice or documents required to be delivered to the Warrant Office,
shall be delivered at, or sent by certified or registered mail to, the offices
of the Company at 314 North Post Oak Lane, Houston, Texas 77024 or such other
address within the continental United States of America as shall have been
furnished by the Company to the holder of this Warrant.
4.7 Limitation of Liability; Not Stockholders. No provision of
this Warrant shall be construed as conferring upon the holder hereof the right
to vote, consent, receive dividends or receive notices (other than as herein
expressly provided) in respect of meetings of stockholders for the election of
directors of the Company or any other matter whatsoever as a stockholder of the
Company. No provision hereof, in the absence of affirmative action by the
holder hereof to purchase shares of Common Stock, and no mere enumeration
herein of the rights or privileges of the holder hereof, shall give rise to any
liability of such holder for the purchase price of any shares of Common Stock
or as a stockholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.
4.8 Exchange, Loss, Destruction, etc. of Warrant. Upon receipt of
evidence satisfactory to the Company of the loss, theft, mutilation or
destruction of this Warrant, and in the case of any such loss, theft or
destruction upon delivery of a bond of indemnity or such other security in such
form and amount as shall be reasonably satisfactory to the Company, or in the
event of such mutilation upon surrender and cancellation of this Warrant, the
Company will make and deliver a new Warrant of like tenor, in lieu of such
lost, stolen, destroyed or mutilated Warrant. Any Warrant issued under the
provisions of this Section 4.8 in lieu of any Warrant alleged to be lost,
destroyed or stolen, or in lieu of any mutilated Warrant, shall constitute an
original contractual obligation on the part of the Company. This Warrant shall
be promptly canceled by the Company upon the surrender hereof in connection
with any exchange or replacement. The Company shall pay all taxes (other than
securities transfer taxes or income taxes) and all other expenses and charges
payable in connection with the preparation, execution and delivery of Warrants
pursuant to this Section 4.8.
4.9 Registration Rights. The Warrant Shares shall be entitled to
such registration rights under the Securities Act and under applicable state
securities laws as are specified in the Registration Rights Agreement.
4.10 Headings. The Article and Section and other headings herein
are for convenience only and are not a part of this Warrant and shall not
affect the interpretation thereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
in its name.
Dated: January 31, 1997
TRANSAMERICAN WASTE INDUSTRIES, INC.
By: /s/ Lance C. Ruud
-------------------------------------
Lance C. Ruud, Senior Vice
President and Chief Financial
Officer
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<PAGE> 15
SUBSCRIPTION NOTICE
The undersigned, the holder of the foregoing Warrant, hereby elects to
exercise purchase rights represented thereby and to purchase thereunder
________ shares of the Common Stock covered by such Warrant, and herewith makes
payment in full for such shares pursuant to Section 1.1 of such Warrant, and
requests (a) that certificates for such shares (and any other securities or
other property issuable upon such exercise) be issued in the name of, and
delivered to _____________________________________ and (b), if such shares
shall not include all of the shares issuable as provided in such Warrant, that
a new Warrant of like tenor and date for the balance of the shares issuable
thereunder be delivered to the undersigned.
--------------------------------
Date:
--------------------------------
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<PAGE> 16
ASSIGNMENT
For value received, _______________________, hereby sells, assigns,
and transfers unto _________________________ the within Warrant, together with
all right, title and interest therein, and does hereby irrevocably constitute
and appoint ________________________ attorney, to transfer such Warrant on the
books of the Company, with full power of substitution.
--------------------------------
Date:
--------------------------------
16
<PAGE> 1
EXHIBIT 3
THE SECURITIES REPRESENTED BY THIS WARRANT AND THE COMMON STOCK ISSUABLE
THEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW AND,
ACCORDINGLY, THE SECURITIES REPRESENTED BY THIS WARRANT MAY NOT BE RESOLD,
PLEDGED, OR OTHERWISE TRANSFERRED, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER, OR IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER, THE
SECURITIES ACT AND IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS.
WARRANT
to Purchase Common Stock of
TRANSAMERICAN WASTE INDUSTRIES, INC.
Expiring on January 31, 2002
This Common Stock Purchase Warrant (the "Warrant") certifies that for
value received, Robert K. Moses, Jr. (the "Holder") or its assigns, is entitled
to subscribe for and purchase from the Company (as hereinafter defined), in
whole or in part, 1,000,000 shares of duly authorized, validly issued, fully
paid and nonassessable shares of Common Stock (as hereinafter defined) at an
initial Exercise Price (as hereinafter defined) per share of $1.25, subject,
however, to the provisions and upon the terms and conditions hereinafter set
forth. The number of Warrants (as hereinafter defined), the number of shares
of Common Stock purchasable hereunder, and the Exercise Price therefor are
subject to adjustment as hereinafter set forth. This Warrant and all rights
hereunder shall expire at 5:00 p.m., Houston, Texas time, on January 31, 2002.
As used herein, the following terms shall have the meanings set forth
below:
"Company" shall mean TransAmerican Waste Industries, Inc., a Delaware
corporation, and shall also include any successor thereto with respect to the
obligations hereunder, by merger, consolidation or otherwise.
"Common Stock" shall mean and include the Company's Common Stock, par
value $0.001 per share, authorized on the date of the original issue of this
Warrant and shall also include (i) in case of any reorganization,
reclassification, consolidation, merger, share exchange or sale, transfer or
other disposition of assets of the character referred to in Section 3.5 hereof,
the stock, securities provided for in such Section 3.5, and (ii) any other
shares of common stock of the Company into which such shares of Common Stock
may be converted.
<PAGE> 2
"Exercise Price" shall mean the initial purchase price of $1.25 per
share of Common Stock payable upon exercise of the Warrants, as adjusted from
time to time pursuant to the provisions hereof.
"Market Price" for any day, when used with reference to Common Stock,
shall mean the price of said Common Stock determined as follows: (x) the last
reported sale price for the Common Stock on such day on the principal
securities exchange on which the Common Stock is listed or admitted to trading
or if no such sale takes place on such date, the average of the closing bid and
asked prices thereof as officially reported, or, if not so listed or admitted
to trading on any securities exchange, the last sale price for the Common Stock
on the National Association of Securities Dealers SmallCap Market on such date,
or, if there shall have been no trading on such date or if the Common Stock
shall not be listed on such system, the average of the closing bid and asked
prices in the over-the-counter market as furnished by any NASD member firm
selected from time to time by the Company for such purpose, in each such case,
unless otherwise provided herein, averaged over a period of ten (10)
consecutive Trading Days prior to the date as of which the determination is to
be made; or (y) if the Common Stock shall not be listed or admitted to trading
as provided in clause (x) above, the fair market value of the Common Stock as
determined in good faith by the Board of Directors of the Company.
"Outstanding," when used with reference to Common Stock, shall mean
(except as otherwise expressly provided herein) at any date as of which the
number of shares thereof is to be determined, all issued shares of Common
Stock, except shares then owned or held by or for the account of the Company.
"Trading Days" shall mean any days during the course of which the
principal securities exchange on which the Common Stock is listed or admitted
to trading is open for the exchange of securities.
"Warrant" shall mean the right upon exercise to purchase one Warrant
Share.
"Warrant Shares" shall mean the shares of Common Stock purchased or
purchasable by the holder hereof upon the exercise of the Warrants.
ARTICLE I
Exercise of Warrants
1.1 Method of Exercise. The Warrants represented hereby may be
exercised by the holder hereof, in whole or in part, at any time and from time
to time on or after the date hereof until 5:00 p.m., Houston, Texas time, on
January 31, 2002. To exercise the Warrants, the holder hereof shall deliver to
the Company, at the Warrant Office designated in Section 2.1 hereof, (i) a
written notice in the form of the Subscription Notice attached as an exhibit
hereto, stating therein
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<PAGE> 3
the election of such holder to exercise the Warrants in the manner provided in
the Subscription Notice; (ii) payment in full of the Exercise Price (A) in cash
or by bank check for all Warrant Shares purchased hereunder, or (B) through a
"cashless" or "net-issue" exercise of each such Warrant ("Cashless Exercise");
the holder shall exchange each Warrant subject to a Cashless Exercise for that
number of Warrant Shares determined by multiplying the number of Warrant Shares
issuable hereunder by a fraction, the numerator of which shall be the
difference between (x) the Market Price and (y) the Exercise Price for each
such Warrant, and the denominator of which shall be the Market Price; the
Subscription Notice shall set forth the calculation upon which the Cashless
Exercise is based, or (C) a combination of (A) and (B) above; and (iii) this
Warrant. The Warrants shall be deemed to be exercised on the date of receipt
by the Company of the Subscription Notice, accompanied by payment for the
Warrant Shares and surrender of this Warrant, as aforesaid, and such date is
referred to herein as the "Exercise Date". Upon such exercise, the Company
shall, as promptly as practicable and in any event within ten (10) business
days, issue and deliver to such holder a certificate or certificates for the
full number of the Warrant Shares purchased by such holder hereunder, and
shall, unless the Warrants have expired, deliver to the holder hereof a new
Warrant representing the number of Warrants, if any, that shall not have been
exercised, in all other respects identical to this Warrant. As permitted by
applicable law, the Person in whose name the certificates for Common Stock are
to be issued shall be deemed to have become a holder of record of such Common
Stock on the Exercise Date and shall be entitled to all of the benefits of such
holder on the Exercise Date, including without limitation the right to receive
dividends and other distributions for which the record date falls on or after
the Exercise Date and to exercise voting rights.
1.2 Expenses and Taxes. The Company shall pay all expenses, and
taxes (including, without limitation, all documentary, stamp, transfer or other
transactional taxes) other than income taxes attributable to the preparation,
issuance or delivery of the Warrants and of the shares of Common Stock issuable
upon exercise of the Warrants.
1.3 Reservation of Shares. The Company shall reserve at all times so
long as the Warrants remain outstanding, free from preemptive rights, out of
its treasury Common Stock or its authorized but unissued shares of Common
Stock, or both, solely for the purpose of effecting the exercise of the
Warrants, a sufficient number of shares of Common Stock to provide for the
exercise of the Warrants.
1.4 Valid Issuance. All shares of Common Stock that may be issued
upon exercise of the Warrants will, upon issuance by the Company, be duly and
validly issued, fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issuance thereof and, without limiting the
generality of the foregoing, the Company shall take no action or fail to take
any action which will cause a contrary result (including, without limitation,
any action that would cause the Exercise Price to be less than the par value,
if any, of the Common Stock).
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<PAGE> 4
1.5 Acknowledgment of Rights. At the time of the exercise of the
Warrants in accordance with the terms hereof and upon the written request of
the holder hereof, the Company will acknowledge in writing its continuing
obligation to afford to such holder any rights (including, without limitation,
any right to registration of the Warrant Shares) to which such holder shall
continue to be entitled after such exercise in accordance with the provisions
of this Warrant; provided, however, that if the holder hereof shall fail to
make any such request, such failure shall not affect the continuing obligation
of the Company to afford to such holder any such rights.
1.6 No Fractional Shares. The Company shall not be required to issue
fractional shares of Common Stock on the exercise of this Warrant. If more
than one Warrant shall be presented for exercise at the same time by the same
holder, the number of full shares of Common Stock which shall be issuable upon
such exercise shall be computed on the basis of the aggregate number of whole
shares of Common Stock purchasable on exercise of the Warrants so presented.
If any fraction of a share of Common Stock would, except for the provisions of
this Section 1.6, be issuable on the exercise of this Warrant, the Company
shall pay an amount in cash calculated by it to be equal to the Market Price of
one share of Common Stock at the time of such exercise multiplied by such
fraction computed to the nearest whole cent.
ARTICLE II
Transfer
2.1 Warrant Office. The Company shall maintain an office for certain
purposes specified herein (the "Warrant Office"), which office shall initially
be the Company's offices at 314 North Post Oak Lane, Houston Texas 77024, and
may subsequently be such other office of the Company or of any transfer agent
of the Common Stock in the continental United States as to which written notice
has previously been given to the holder hereof. The Company shall maintain, at
the Warrant Office, a register for the Warrants in which the Company shall
record the name and address of the Person in whose name this Warrant has been
issued, as well as the name and address of each permitted assignee of the
rights of the registered owner hereof.
2.2 Ownership of Warrants. The Company may deem and treat the Person
in whose name the Warrants are registered as the holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by anyone
other than the Company) for all purposes and shall not be affected by any
notice to the contrary until presentation of this Warrant for registration of
transfer as provided in this Article II. Notwithstanding the foregoing, the
Warrants represented hereby, if properly assigned in compliance with this
Article II, may be exercised by an assignee for the purchase of Warrant Shares
without having a new Warrant issued.
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<PAGE> 5
2.3 Restrictions on Transfer of Warrants. The Company agrees to
maintain at the Warrant Office books for the registration and transfer of the
Warrants. Subject to the restrictions on transfer of the Warrants in this
Section 2.3, the Company, from time to time, shall register the transfer of the
Warrants in such books upon surrender of this Warrant at the Warrant Office
properly endorsed or accompanied by appropriate instruments of transfer and
written instructions for transfer satisfactory to the Company. Upon any such
transfer and upon payment by the holder or its transferee of any applicable
transfer taxes, new Warrants shall be issued to the transferee and the
transferor (as their respective interests may appear) and the surrendered
Warrants shall be cancelled by the Company. The Company shall pay all taxes
(other than securities transfer taxes or income taxes) and all other expenses
and charges payable in connection with the transfer of the Warrants pursuant to
this Section 2.3.
2.3.1 Restrictions in General. The holder of the Warrants
agrees that it will neither (i) transfer the Warrants prior to delivery to the
Company of written notice of such transfer, nor (ii) transfer such Warrant
Shares prior to delivery to the Company of written notice of such transfer, or
until registration of such Warrant Shares under the Securities Act and any
applicable state securities or blue sky laws has become effective.
2.4 Compliance with Securities Laws. Subject to the terms of the
Registration Rights Agreement between the Holder and the Company dated as of
the date hereof and notwithstanding any other provisions contained in this
Warrant, the holder hereof understands and agrees that the following
restrictions and limitations shall be applicable to all Warrant Shares and to
all resales or other transfers thereof pursuant to the Securities Act:
2.4.1 The holder hereof agrees that the Warrant Shares shall not
be sold or otherwise transferred unless the Warrant Shares are registered under
the Securities Act and applicable state securities or blue sky laws or are
exempt therefrom.
2.4.2 A legend in substantially the following form will be
placed on the certificate(s) evidencing the Warrant Shares:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW AND,
ACCORDINGLY, THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY
NOT BE RESOLD, PLEDGED, OR OTHERWISE TRANSFERRED, EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER, OR IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER, THE SECURITIES ACT AND IN
ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS."
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<PAGE> 6
2.4.3 Stop transfer instructions will be imposed with respect to
the Warrant Shares so as to restrict resale or other transfer thereof, subject
to this Section 2.4.
ARTICLE III
Anti-Dilution
3.1 Anti-Dilution Provisions. The Exercise Price shall be subject to
adjustment from time to time as hereinafter provided. Upon each adjustment of
the Exercise Price, the holder of this Warrant shall thereafter be entitled to
purchase, at the Exercise Price resulting from such adjustment, the number of
shares of Common Stock obtained by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of shares purchasable
pursuant hereto immediately prior to such adjustment and dividing the product
thereof by the Exercise Price resulting from such adjustment.
3.2 Adjustment of Exercise Price Upon Issuance of Common Stock.
3.2.1 (A) If and whenever after the date hereof the Company
shall issue or sell any Common Stock for no consideration or for a
consideration per share less than the Exercise Price, then, forthwith upon such
issue or sale, the Exercise Price shall be reduced (but not increased, except
as otherwise specifically provided in Section 3.2.2(C) hereof), to the price
(calculated to the nearest one-ten thousandth of a cent) determined by dividing
(x) an amount equal to the sum of (i) the aggregate number of shares of Common
Stock outstanding immediately prior to such issue or sale multiplied by then
existing Exercise Price plus (ii) the consideration received by the Company
upon such issue or sale by (y) the aggregate number of shares of Common Stock
outstanding immediately after such issue or sale. Notwithstanding the
foregoing and in lieu thereof, in the event the Company issues additional
shares pursuant to Section 2.2 of that certain Registration Rights Agreement of
even date herewith among the Company, Sanders Morris Mundy, Inc. and certain
other persons named on Exhibit A thereto, then the Exercise Price shall be
reduced to the price determined by dividing the then existing Exercise Price by
one and one-half (1.5).
(B) Notwithstanding the provisions of this Section 3.2,
no adjustment shall be made in the Exercise Price in the event that the Company
issues, in one or more transactions, (i) Common Stock or convertible securities
upon exercise of any options issued to officers, directors or employees of the
Company pursuant to a stock option plan or an employment, severance or
consulting agreement as now or hereafter in effect, in each case approved by
the Board of Directors (provided that the aggregate number of shares of Common
Stock which may be issuable, including options issued prior to the date hereof,
under all such employee plans and agreements shall at no time exceed the number
of such shares of Common Stock that are issuable under currently effective
employee plans and agreements); (ii) Common Stock upon exercise of any stock
purchase warrant or option (other than the options referred to
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<PAGE> 7
in clause (i) above) or other convertible security outstanding on the date
hereof; or (iii) Common Stock issued as consideration in, or in connection
with, acquisitions by the Company. In addition, for purposes of calculating
any adjustment of the Exercise Price as provided in this Section 3.2, all of
the shares of Common Stock issuable pursuant to any of the foregoing shall be
assumed to be outstanding prior to the event causing such adjustment to be
made.
3.2.2 For purposes of this Section 3.2, the following Sections
3.2.2(A) to 3.2.2(E) inclusive, shall be applicable:
(A) Issuance of Rights or Options. In case at any time after
the date hereof the Company shall in any manner grant (whether directly
or by assumption in a merger or otherwise) any rights to subscribe for
or to purchase, or any options for the purchase of, Common Stock or any
stock or securities convertible into or exchangeable for Common Stock
(such convertible or exchangeable stock or securities being herein
called "Convertible Securities"), whether or not such rights or options
or the right to convert or exchange any such Convertible Securities are
immediately exercisable, and the price per share for which shares of
Common Stock are issuable upon the exercise of such rights or options or
upon conversion or exchange of such Convertible Securities (determined
by dividing (i) the total amount, if any, received or receivable by the
Company as consideration for the granting of such rights or options,
plus the minimum aggregate amount of additional consideration, if any,
payable to the Company upon the exercise of such rights or options, or
plus, in the case of such rights or options that relate to Convertible
Securities, the minimum aggregate amount of additional consideration, if
any, payable upon the issue or sale of such Convertible Securities and
upon the conversion or exchange thereof, by (ii) the total maximum
number of shares of Common Stock issuable upon the exercise of such
rights or options or upon the conversion or exchange of all such
Convertible Securities issuable upon the exercise of such rights or
options) shall be less than the Exercise Price in effect as of the date
of granting such rights or options, then the total maximum number of
shares of Common Stock issuable upon the exercise of such rights or
options or upon conversion or exchange of all such Convertible
Securities issuable upon the exercise of such rights or options shall be
deemed to be outstanding as of the date of the granting of such rights
or options and to have been issued for such price per share, with the
effect on the Exercise Price specified in Section 3.2.1 hereof. Except
as provided in Section 3.2.2 hereof, no further adjustment of the
Exercise Price shall be made upon the actual issuance of such Common
Stock or of such Convertible Securities upon exercise of such rights or
options or upon the actual issuance of such Common Stock upon conversion
or exchange of such Convertible Securities.
(B) Change in Option Price or Conversion Rate. Upon the
happening of any of the following events, namely, if the purchase price
provided for in any right or option referred to in Section 3.2.2, the
additional consideration, if any, payable upon the conversion or
exchange of any Convertible Securities referred to in Section 3.2.2, or
the
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<PAGE> 8
rate at which any Convertible Securities referred to in Section 3.2.2,
are convertible into or exchangeable for Common Stock shall change
(other than under or by reason of provisions designed to protect against
dilution), the Exercise Price then in effect hereunder shall forthwith
be readjusted (increased or decreased, as the case may be) to the
Exercise Price that would have been in effect at such time had such
rights, options or Convertible Securities still outstanding provided for
such changed purchase price, additional consideration or conversion
rate, as the case may be, at the time initially granted, issued or sold.
On the expiration of any such option or right referred to in Section
3.2.2, or on the termination of any such right to convert or exchange
any such Convertible Securities referred to in Section 3.2.2, the
Exercise Price then in effect hereunder shall forthwith be readjusted
(increased or decreased, as the case may be) to the Exercise Price that
would have been in effect at the time of such expiration or termination
had such right, option or Convertible Securities, to the extent
outstanding immediately prior to such expiration or termination, never
been granted, issued or sold, and the Common Stock issuable thereunder
shall no longer be deemed to be outstanding. If the purchase price
provided for in Section 3.2.2 or the rate at which any Convertible
Securities referred to in Section 3.2.2 reduced at any time under or by
reason of provisions with respect thereto designed to protect against
dilution, then in case of the delivery of Common Stock upon the exercise
of any such right or option or upon conversion or exchange of any such
Convertible Securities, the Exercise Price then in effect hereunder
shall, if not already adjusted, forthwith be adjusted to such amount as
would have obtained had such right, option or Convertible Securities
never been issued as to such Common Stock and had adjustments been made
upon the issuance of the Common Stock delivered as aforesaid, but only
if as a result of such adjustment the Exercise Price then in effect
hereunder is thereby reduced.
(C) Consideration for Stock. In case at any time Common Stock
or Convertible Securities or any rights or options to purchase any such
Common Stock or Convertible Securities shall be issued or sold for cash,
the consideration therefor shall be deemed to be the amount received by
the Company therefor. In case at any time any Common Stock, Convertible
Securities or any rights or options to purchase any such Common Stock or
Convertible Securities shall be issued or sold for consideration other
than cash, the amount of the consideration other than cash received by
the Company shall be deemed to be the fair value of such consideration,
as determined reasonably and in good faith by the Board of Directors of
the Company. In case at any time any Common Stock, Convertible
Securities or any rights or options to purchase any Common Stock or
Convertible Securities shall be issued in connection with any merger or
consolidation in which the Company is the surviving corporation, the
amount of consideration received therefor shall be deemed to be the fair
value, as determined reasonably and in good faith by the Board of
Directors of the Company, of such portion of the assets and business of
the nonsurviving corporation as such Board of Directors may determine to
be attributable to such Common Stock, Convertible Securities, rights or
options as the case may be. In case at any time any rights or options
to purchase any shares of Common Stock or Convertible
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Securities shall be issued in connection with the issuance and sale of
other securities of the Company, together consisting of one integral
transaction in which no consideration is allocated to such rights or
options by the parties, such rights or options shall be deemed to have
been issued with consideration.
(D) Record Date. In the case the Company shall take a record
of the holders of its Common Stock for the purpose of entitling them (i)
to receive a dividend or other distribution payable in Common Stock or
Convertible Securities, or (ii) to subscribe for or purchase Common
Stock or Convertible Securities, then such record date shall be deemed
to be the date of the issuance or sale of the Common Stock or
Convertible Securities deemed to have been issued or sold as a result of
the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription
or purchase, as the case may be.
(E) Treasury Shares. The number of shares of Common Stock
outstanding at any given time shall not include shares owned directly by
the Company in treasury, and the disposition of any such shares shall be
considered an issuance or sale of Common Stock for the purpose of this
Section 3.2.
3.3 Stock Dividends. In case the Company shall declare a dividend or
make any other distribution upon any shares of the Company, payable in Common
Stock or Convertible Securities, any Common Stock or Convertible Securities, as
the case may be, issuable in payment of such dividend or distribution shall be
deemed to have been issued or sold without consideration.
3.4 Stock Splits and Reverse Splits. In the event that the Company
shall at any time subdivide its outstanding shares of Common Stock into a
greater number of shares, the Exercise Price in effect immediately prior to
such subdivision shall be proportionately reduced and the number of Warrant
Shares purchasable pursuant to this Warrant immediately prior to such
subdivision shall be proportionately increased, and conversely, in the event
that the outstanding shares of Common stock shall at any time be combined into
a smaller number of shares, the Exercise Price in effect immediately prior to
such combination shall be proportionately increased and the number of Warrant
Shares purchasable upon the exercise of this Warrant immediately prior to such
combination shall be proportionately reduced. Except as provided in this
Section 3.4, no adjustment in the Exercise Price and no change in the number of
Warrant Shares purchasable shall be made under this Article III as a result of
or by reason of any such subdivision or combination.
3.5 Reorganizations and Asset Sales. If any capital reorganization
or reclassification of the capital stock of the Company, or any consolidation,
merger or share exchange of the Company with another Person, or the sale,
transfer or other disposition of all or substantially all of its assets to
another Person shall be effected in such a way that a holder of Common Stock of
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<PAGE> 10
the Company shall be entitled to receive capital stock, securities or assets
with respect to or in exchange for their shares, then the following provisions
shall apply:
3.5.1 As a condition of such reorganization, reclassification,
consolidation, merger, share exchange, sale, transfer or other disposition
(except as otherwise provided below in this Section 3.5), lawful and adequate
provisions shall be made whereby the holder of Warrants shall thereafter have
the right to purchase and receive upon the terms and conditions specified in
this Warrant and in lieu of the Warrant Shares immediately theretofore
receivable upon the exercise of the rights represented hereby, such shares of
capital stock, securities or assets as may be issued or payable with respect to
or in exchange for a number of outstanding shares of such Common Stock equal to
the number of Warrant Shares immediately theretofore so receivable had such
reorganization, reclassification, consolidation, merger, share exchange or sale
not taken place, and in any such case appropriate provision reasonably
satisfactory to such holder shall be made with respect to the rights and
interests of such holder to the end that the provisions hereof (including,
without limitation, provisions for adjustments of the Exercise Price and of the
number of Warrant Shares receivable upon the exercise) shall thereafter be
applicable, as nearly as possible, in relation to any shares of capital stock,
securities or assets thereafter deliverable upon the exercise of Warrants.
3.5.2 In the event of a merger, share exchange or consolidation
of the Company with or into another Person as a result of which a number of
shares of common stock or its equivalent of the successor Person greater or
lesser than the number of shares of Common Stock outstanding immediately prior
to such merger, share exchange or consolidation are issuable to holders of
Common Stock, then the Exercise Price in effect immediately prior to such
merger, share exchange or consolidation shall be adjusted in the same manner as
though there were a subdivision or combination of the outstanding shares of
Common Stock.
3.5.3 The Company shall not effect any such consolidation,
merger, share exchange, sale, transfer or other disposition unless prior to or
simultaneously with the consummation thereof the successor Person (if other
than the Company) resulting from such consolidation, share exchange or merger
or the Person purchasing or otherwise acquiring such assets shall have assumed
by written instrument executed and mailed or delivered to the holder hereof at
the last address of such holder appearing on the books of the Company the
obligation to deliver to such holder such shares of capital stock, securities
or assets as, in accordance with the foregoing provisions, such holder may be
entitled to receive, and all other liabilities and obligations of the Company
hereunder. Upon written request by the holder hereof, such successor Person
will issue a new Warrant revised to reflect the modifications in this Warrant
effected pursuant to this Section 3.5.
3.5.4 If a purchase, tender or exchange offer is made to and
accepted by the holders of 50% or more of the outstanding shares of Common
Stock, the Company shall not effect
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any consolidation, merger, share exchange or sale, transfer or other
disposition of all or substantially all of the Company's assets with the Person
having made such offer or with any affiliate of such Person, unless prior to
the consummation of such consolidation, merger, share exchange, sale, transfer
or other disposition the holder hereof shall have been given a reasonable
opportunity to then elect to receive upon the exercise of the Warrants either
the capital stock, securities or assets then issuable with respect to the
Common Stock or the capital stock, securities or assets, or the equivalent,
issued to previous holders of the Common Stock in accordance with such offer.
3.6 Adjustment for Asset Distribution. If the Company declares a
dividend or other distribution payable to all holders of shares of Common Stock
in evidences of indebtedness of the Company or other assets of the Company
(including, cash (other than regular cash dividends declared by the Board of
Directors), capital stock (other than Common Stock, Convertible Securities or
options or rights thereto) or other property), the Exercise Price in effect
immediately prior to such declaration of such dividend or other distribution
shall be reduced by an amount equal to the amount of such dividend or
distribution payable per share of Common Stock, in the case of a cash dividend
or distribution, or by the fair value of such dividend or distribution per
share of Common Stock (as reasonably determined in good faith by the Board of
Directors of the Company), in the case of any other dividend or distribution.
Such reduction shall be made whenever any such dividend or distribution is made
and shall be effective as of the date as of which a record is taken for purpose
of such dividend or distribution or, if a record is not taken, the date as of
which holders of record of Common Stock entitled to such dividend or
distribution are determined.
3.7 De Minimis Adjustments. No adjustment in the number of shares of
Common Stock purchasable hereunder shall be required unless such adjustment
would require an increase or decrease of at least one share of Common Stock
purchasable upon an exercise of each Warrant and no adjustment in the Exercise
Price shall be required unless such adjustment would require an increase or
decrease of at least $0.01 in the Exercise Price; provided, however, that any
adjustments which by reason of this Section 3.7 are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations shall be made to the nearest full share or nearest one
hundredth of a dollar, as applicable.
3.8 Notice of Adjustment. Whenever the Exercise Price or the number
of Warrant Shares issuable upon the exercise of the Warrants shall be adjusted
as herein provided, or the rights of the holder hereof shall change by reason
of other events specified herein, the Company shall compute the adjusted
Exercise Price and the adjusted number of Warrant Shares in accordance with the
provisions hereof and shall prepare an Officer's Certificate setting forth the
adjusted Exercise Price and the adjusted number of Warrant Shares issuable upon
the exercise of the Warrants or specifying the other shares of stock,
securities or assets receivable as a result of such change in rights, and
showing in reasonable detail the facts and calculations upon which such
adjustments or other changes are based. The Company shall cause to be mailed
to the holder
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hereof copies of such Officer's Certificate together with a notice stating that
the Exercise Price and the number of Warrant Shares purchasable upon exercise
of the Warrants have been adjusted and setting forth the adjusted Exercise
Price and the adjusted number of Warrant Shares purchasable upon the exercise
of the Warrants.
3.9 Notifications to Holders. In case at any time the Company
proposes:
(i) to declare any dividend upon its Common Stock payable in
capital stock or make any special dividend or other distribution (other
than cash dividends) to the holders of its Common Stock;
(ii) to offer for subscription pro rata to all of the holders
of its Common Stock any additional shares of capital stock of any class
or other rights;
(iii) to effect any capital reorganization, or reclassification
of the capital stock of the Company, or consolidation, merger or share
exchange of the Company with another Person, or sale, transfer or other
disposition of all or substantially all of its assets; or
(iv) to effect a voluntary or involuntary dissolution,
liquidation or winding up of the Company,
then, in any one or more of such cases, the Company shall give the holder
hereof (a) at least 10 days' (but not more than 90 days') prior written notice
of the date of which the books of the Company shall close or a record shall be
taken for such dividend, distribution or subscription rights or for determining
rights to vote in respect of such issuance, reorganization, reclassification,
consolidation, merger, share exchange, sale, transfer, disposition,
dissolution, liquidation or winding up, and (b) in the case of any such
issuance, reorganization, reclassification, consolidation, merger, share
exchange, sale, transfer, disposition, dissolution, liquidation or winding up,
at least 10 days' (but not more than 90 days') prior written notice of the date
when the same shall take place. Such notice in accordance with the foregoing
clause (a) shall also specify, in the case of any such dividend, distribution
or subscription rights, the date on which the holders of Common Stock shall be
entitled thereto, and such notice in accordance with the foregoing clause (b)
shall also specify the date on which the holders of Common Stock shall be
entitled to exchange their Common Stock, as the case may be, for securities or
other property deliverable upon such reorganization, reclassification,
consolidation, merger, share exchange, sale, transfer, disposition,
dissolution, liquidation or winding up, as the case may be.
3.10 Company to Prevent Dilution. If any event or condition occurs as
to which other provisions of this Article III are not strictly applicable or if
strictly applicable would not fairly protect the exercise or purchase rights of
the Warrants evidenced hereby in accordance with the essential intent and
principles of such provisions, or that might materially and adversely affect
the exercise or purchase rights of the holder hereof under any provisions of
this Warrant, then the
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Company shall make such adjustments in the application of such provisions, in
accordance with such essential intent and principles, so as to protect such
exercise and purchase rights as aforesaid, and any adjustments necessary with
respect to the Exercise Price and the number of Warrant Shares purchasable
hereunder so as to preserve the rights of the holder hereunder. In no event
shall any such adjustment have the effect of increasing the Exercise Price as
otherwise determined pursuant to this Article III except in the event of a
combination of shares of the type contemplated in Section 3.4 hereof, and then
in no event to an amount greater than the Exercise Price as adjusted pursuant
to Section 3.4 hereof.
ARTICLE IV
Miscellaneous
4.1 Entire Agreement. This Warrant contains the entire agreement
between the holder hereof and the Company with respect to the Warrant Shares
purchasable upon exercise hereof and the related transactions and supersedes
all prior arrangements or understandings with respect thereto.
4.2 Governing Law. This warrant shall be governed by and construed
in accordance with the laws of the State of Delaware.
4.3 Waiver and Amendment. Any term or provision of this Warrant may
be waived at any time by the party which is entitled to the benefits thereof
and any term or provision of this Warrant may be amended or supplemented at any
time by agreement of the holder hereof and the Company, except that any waiver
of any term or condition, or any amendment or supplementation, of this Warrant
shall be in writing. A waiver of any breach or failure to enforce any of the
terms or conditions of this Warrant shall not in any way effect, limit or waive
a party's rights hereunder at any time to enforce strict compliance thereafter
with every term or condition of this Warrant.
4.4 Illegality. In the event that any one or more of the provisions
contained in this Warrant shall be determined to be invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in any other respect and the remaining
provisions of this Warrant shall not, at the election of the party for whom the
benefit of the provision exists, be in any way impaired.
4.5 Copy of Warrant. A copy of this Warrant shall be filed among the
records of the Company.
4.6 Notice. Any notice or other document required or permitted to be
given or delivered to the holder hereof shall be in writing and delivered at,
or sent by certified or registered mail to such holder at, the last address
shown on the books of the Company maintained at the Warrant Office for the
registration of this Warrant or at any more recent address of which the
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holder hereof shall have notified the Company in writing. Any notice or other
document required or permitted to be given or delivered to the Company, other
than such notice or documents required to be delivered to the Warrant Office,
shall be delivered at, or sent by certified or registered mail to, the offices
of the Company at 314 North Post Oak Lane, Houston, Texas 77024 or such other
address within the continental United States of America as shall have been
furnished by the Company to the holder of this Warrant.
4.7 Limitation of Liability; Not Stockholders. No provision of this
Warrant shall be construed as conferring upon the holder hereof the right to
vote, consent, receive dividends or receive notices (other than as herein
expressly provided) in respect of meetings of stockholders for the election of
directors of the Company or any other matter whatsoever as a stockholder of the
Company. No provision hereof, in the absence of affirmative action by the
holder hereof to purchase shares of Common Stock, and no mere enumeration
herein of the rights or privileges of the holder hereof, shall give rise to any
liability of such holder for the purchase price of any shares of Common Stock
or as a stockholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.
4.8 Exchange, Loss, Destruction, etc. of Warrant. Upon receipt of
evidence satisfactory to the Company of the loss, theft, mutilation or
destruction of this Warrant, and in the case of any such loss, theft or
destruction upon delivery of a bond of indemnity or such other security in such
form and amount as shall be reasonably satisfactory to the Company, or in the
event of such mutilation upon surrender and cancellation of this Warrant, the
Company will make and deliver a new Warrant of like tenor, in lieu of such
lost, stolen, destroyed or mutilated Warrant. Any Warrant issued under the
provisions of this Section 4.8 in lieu of any Warrant alleged to be lost,
destroyed or stolen, or in lieu of any mutilated Warrant, shall constitute an
original contractual obligation on the part of the Company. This Warrant shall
be promptly canceled by the Company upon the surrender hereof in connection
with any exchange or replacement. The Company shall pay all taxes (other than
securities transfer taxes or income taxes) and all other expenses and charges
payable in connection with the preparation, execution and delivery of Warrants
pursuant to this Section 4.8.
4.9 Registration Rights. The Warrant Shares shall be entitled to
such registration rights under the Securities Act and under applicable state
securities laws as are specified in the Registration Rights Agreement.
4.10 Headings. The Article and Section and other headings herein are
for convenience only and are not a part of this Warrant and shall not affect
the interpretation thereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed in
its name.
Dated: January 31, 1997
TRANSAMERICAN WASTE INDUSTRIES, INC.
By: /s/ Lance C. Ruud
-------------------------------------
Lance C. Ruud, Senior Vice President
and Chief Financial Officer
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SUBSCRIPTION NOTICE
The undersigned, the holder of the foregoing Warrant, hereby elects to
exercise purchase rights represented thereby and to purchase thereunder
________ shares of the Common Stock covered by such Warrant, and herewith makes
payment in full for such shares pursuant to Section 1.1 of such Warrant, and
requests (a) that certificates for such shares (and any other securities or
other property issuable upon such exercise) be issued in the name of, and
delivered to _____________________________________ and (b), if such shares
shall not include all of the shares issuable as provided in such Warrant, that
a new Warrant of like tenor and date for the balance of the shares issuable
thereunder be delivered to the undersigned.
------------------------------
Date:
--------------------------------------
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ASSIGNMENT
For value received, _______________________, hereby sells, assigns, and
transfers unto _________________________ the within Warrant, together with all
right, title and interest therein, and does hereby irrevocably constitute and
appoint ________________________ attorney, to transfer such Warrant on the
books of the Company, with full power of substitution.
------------------------------
Date:
--------------------------------------
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EXHIBIT 4
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement ("Agreement") dated January
31, 1997, is entered into by and between TransAmerican Waste Industries, Inc.,
a Delaware corporation (the "Company") and Robert K. Moses, Jr. (the "Holder").
This Agreement evidences that for good and valuable consideration, the receipt
and sufficiency of which is acknowledged, the Company and the Holder agree as
follows:
ARTICLE 1. INTRODUCTION
SECTION 1.1 RECITALS. In connection with the receipt by a wholly-
owned subsidiary of the Company of an $8.5 million loan from a certain bank
(the "Loan"), Holder personally guaranteed the Loan and pledged certain shares
of stock to secure such Loan. As consideration for such guarantee, the Company
issued to Holder a Warrant to purchase 2,000,000 shares of the Company's Common
Stock for $1.00 per share and a Warrant to purchase 1,000,000 shares of the
Company's Common Stock for $1.25 per share (collectively referred to herein as
the "Warrants"). The 3,000,000 shares of the Company's Common Stock
purchasable upon the exercise of the Warrants are referred to herein as the
"Warrant Shares".
SECTION 1.2 DEFINITIONS. Certain capitalized terms used in this
Agreement are defined in Article 6 hereof; references to sections shall be to
sections of this Agreement.
ARTICLE 2. REQUIRED REGISTRATION
SECTION 2.1 SHELF REGISTRATION.
(a) Within four months of the Closing, the Company shall file
with the Commission a registration statement covering the resale of the
Warrant Shares on the appropriate form (the "Registration Statement")
and shall designate such registration to be a "shelf" registration
pursuant to Rule 415 under the Act. The Company shall use its best
efforts to cause such Registration Statement to become effective as soon
as practicable and in no event later than seven months after the Closing
and to cause the Warrant Shares to be qualified in such state
jurisdictions as the Holder may request.
(b) The Company shall keep the Registration Statement current
and effective until the earlier of (i) five years from the date hereof
or (ii) the Warrant Shares may be resold under Rule 144(k) promulgated
under the Act. The Company shall supplement or make amendments to the
Registration Statement, if required by the registration form used by the
Company, the instructions thereto, the Act or the rules and regulations
of the Commission. The Company will furnish the Holder a copy of all
such supplements or amendments at least one business day prior to filing
such supplement or amendment.
<PAGE> 2
(c) The Company shall be entitled to require that the Holder
refrain from effecting any purchases or public sales or distributions of
the Warrant Shares pursuant to a Registration Statement that has been
declared effective by the Commission, if the board of directors of the
Company reasonably determines that such public sales or distributions
would interfere in any material respect with any transaction involving
the Company that the board of directors reasonably determines to be
material to the Company. The Company will notify the Holder of such an
event pursuant to Section 4.1(g). In the event of a request by the
board of directors of the Company that the Holder refrain from effecting
any purchases or public sales or distributions of the Warrant Shares or
offering any Warrant Shares pursuant to the Registrant Statement, the
Company shall be required (i) to lift such restrictions regarding
effecting public purchases or sales or distributions of the Warrant
Shares, as the case may be, as soon as reasonably practicable after the
board of directors shall reasonably determine public sales or
distributions by the Holder of the Warrant Shares shall not interfere
with such transaction and (ii) to deliver an amended prospectus
disclosing the material event, if necessary; provided, that in no event
shall any requirement that the Holder refrain from effecting public
sales or distributions in the Warrant Shares extend for more than 90
days.
SECTION 2.2 EFFECTIVE REGISTRATION STATEMENT. A registration of
Warrant Shares pursuant to this Article 2 shall not be deemed to have been
effective (i) unless a Registration Statement with respect to the Warrant
Shares has become effective, provided, that a Registration Statement which does
not become effective after the Company has filed such Registration Statement
solely by reason of the refusal to proceed by the Holder (other than a refusal
to proceed based upon the advice of counsel relating to a matter related solely
to the Company) shall be deemed to have been effected by the Company unless the
Holder shall have elected to pay all Registration Expenses in connection with
such registration; or (ii) if, after it has become effective, such registration
is withdrawn by the Company (other than at the request of the Holder),
interfered with by any stop order, injunction or other order or requirement of
the Commission or other governmental agency or court for any reason prior to
the expiration of a ninety-day period following the effectiveness of such
Registration Statement effectiveness, or (iii) the conditions to closing
specified in any purchase agreement or underwriting agreement entered into in
connection with such registration are not satisfied due to some act or omission
by the Company.
SECTION 2.3 UNDERWRITING. If the Registration Statement required by
this Article 2 is filed pursuant to an underwritten offering, the right of the
Holder to registration pursuant to Section 2.1 shall be conditioned upon such
Holder's participation in such reasonable underwriting arrangements as the
Company shall make regarding the offering, and the inclusion of Warrant Shares
in the underwriting shall be limited to the extent provided herein. The Holder
shall (together with the Company and the other holders distributing their
securities through such underwriting) enter into an underwriting agreement in
customary form with the managing underwriter selected for such underwriting by
the Company. If the managing underwriter concludes in its reasonable judgment
that the number of shares to be registered for selling stockholders (including
the Holder) would materially adversely effect such offering and exceeds the
number of shares which can be sold in such offering within a price range
reasonably acceptable to the underwriter, the Company and the Holder, then the
Holder shall be given written notice
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thereof stating the basis for such belief and the number of Shares to be
registered. The Shares, together with the number of shares of Common Stock or
other securities subject to a contractual right to participate in the offering,
held by Persons that have notified the Company of their intent to be included
and registered in such offering, shall be reduced on a pro rata basis based on
the number of Warrant Shares proposed to be sold by the Holder as compared to
the number of shares proposed to be sold by all stockholders. If the Holder
disapproves of the terms of any such underwriting, it may elect to withdraw
therefrom by written notice to the Company and the managing underwriter,
delivered not less than ten days before the effective date. Any securities
excluded or withdrawn from such underwriting shall be withdrawn from such
registration, and shall not be transferred in a public distribution prior to 90
days after the effective date of the registration statement relating thereto,
or such other shorter period of time as the underwriters may require. If
Holder effect the sale of less than all his Warrant Shares in such underwritten
offering, the Company shall have the continuing obligation to effect the
registration of the remaining Warrant Shares pursuant to Section 2.1 hereof.
ARTICLE 3. "PIGGY-BACK" REGISTRATION
SECTION 3.1 RIGHT TO INCLUDE REGISTRABLE SECURITIES. Except as set
forth below, if the Company at any time proposes to file a Registration
Statement under the Act covering any of its securities other than (i) a
registration on Form S-4, Form S-8, or any successor or similar forms, or (ii)
a shelf registration under Rule 415 under the Act for the sole purpose of
registering shares to be issued in connection with the acquisition of assets,
whether or not for sale for its own account, it will each such time give prompt
written notice to the Holder of its intention to do so and of the Holder's
rights under this Article 3. Upon the written request of the Holder made
within 30 days after the receipt of any such notice (which request shall
specify the Warrant Shares intended to be disposed of by the Holder and the
intended method of disposition thereof), the Company will use its best efforts
to effect the registration under the Act of all Warrant Shares which the
Company has been so requested to register by the Holder, to the extent required
to permit the disposition in accordance with the intended methods of
disposition, by inclusion of such Warrant Shares in the Registration Statement
which covers the securities that the Company proposes to register ("Piggy-Back
Right"); provided, that if, at any time after giving written notice of its
intention to register any securities and prior to the effective date of the
Registration Statement filed in connection with such registration, the Company
shall determine for any reason either not to register or to delay registration
of such securities, the Company may, at its election, give written notice of
such determination to the Holder and, thereupon, (i) in the case of a
determination not to register, shall be relieved of its obligation to register
any Warrant Shares in connection with such registration (but not from its
obligation to pay the Registration Expenses in connection therewith), without
prejudice, subject to the rights of the Holder under Article 2 and (ii) in the
case of a determination to delay registering, shall be permitted to delay
registering any Warrant Shares, for the same period as the delay in registering
such other securities. The Company shall have no further obligation, and the
Holder shall have no rights, pursuant to any provision of this Article 3 after
the earlier of (a) five years from the date hereof or (b) the Warrant Shares
may be sold under Rule 144(k) promulgated under the Act. No registration
effected under
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this Article 3 shall relieve the Company of its obligation to effect any
registration under Article 2 unless all the Warrant Shares are included in such
registration.
SECTION 3.2 PRIORITY IN PIGGY-BACK REGISTRATIONS. If (i) a
registration pursuant to Article 3 involves an underwritten offering of the
securities being registered, whether or not for sale for the account of the
Company, to be distributed by or through one or more underwriters under
underwriting terms appropriate for such a transaction, and (ii) the managing
underwriter of such underwritten offering shall inform the Company and the
Holder by letter of its belief that the distribution of all or a specified
number of such Warrant Shares concurrently with the securities being
distributed by such underwriters would interfere with the successful marketing
of the securities being distributed by such underwriters (such writing to state
the basis of such belief and the approximate number of such Warrant Shares
which may be distributed without such effect), then the Company may, upon
written notice to the Holder, reduce pro rata (if and to the extent stated by
such managing underwriter to be necessary to eliminate such effect) the number
of such Warrant Shares and securities proposed to be sold by any Person other
than the Company the registration of which shall have been requested by the
Holder and each security holder so that the resultant aggregate number of such
securities so included in such registration shall be equal to the number of
shares stated in such managing underwriter's letter.
ARTICLE 4. REGISTRATION PROCEDURES
SECTION 4.1 PREPARATION OF FILINGS. If and whenever the Company is
required to use its best efforts to effect the registration of any Warrant
Shares under the Act as provided in Articles 2 or 3 the following shall apply:
(a) Registration Statement. The Company shall promptly
prepare and file with the Commission the requisite Registration
Statement to effect such registration (including such audited financial
statements as may be required by the Act or the rules and regulations
promulgated thereunder) and thereafter use its reasonable best efforts
to cause such Registration Statement to become and remain effective;
provided, however, that the Company may withdraw any registration of its
securities at any time prior to the effective date of the Registration
Statement relating thereto; provided further, that before filing such
Registration Statement or any amendments thereto, the Company will
furnish to the Holder and its counsel copies of all such documents
proposed to be filed.
(b) Amendments. The Company shall prepare and file with the
Commission such amendments, post-effective amendments and supplements to
such Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement
effective and to comply with the provisions of the Act with respect to
the disposition of all securities covered by such Registration Statement
for the time periods specified in Section 2.1(b).
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(c) Copies of Documents. The Company shall furnish to the
Holder and each underwriter, if any, of the securities being sold by the
Holder such number of conformed copies of such Registration Statement
and of each amendment and supplement thereto (in each case including all
exhibits to such Registration Statement), such number of copies of the
prospectus contained in such Registration Statement (including each
preliminary prospectus and any summary prospectus) and any other
prospectus filed pursuant to Rule 424 under the Act and such other
documents, as the Holder and underwriter, if any, may reasonably request
in order to facilitate the public sale or other disposition of the
securities owned by the Holder (it being understood that the Company
consents to the use of the prospectus and any amendments or supplement
thereto by the Holder and the underwriter or underwriters, if any, in
connection with the offering and sale of securities covered by the
prospectus or any amendment or supplement thereto).
(d) Blue-Sky. The Company will use its reasonable best
efforts to register or qualify all Warrant Shares under the securities
laws or blue sky laws of the jurisdictions as the Holder and any
underwriter of the securities being sold by the Holder shall reasonably
request, to keep such registrations or qualifications in effect for so
long as such Registration Statement remains in effect, and take any
other action which may be reasonably necessary or advisable to enable
the Holder and underwriter to consummate the disposition in such
jurisdictions of the securities owned by the Holder, except that the
Company shall not for any such purpose be required to qualify generally
to do business as a foreign corporation in any jurisdiction wherein it
would not but for the requirements of this subsection (d) be obligated
to be so qualified, or to consent to general service of process in any
such jurisdiction.
(e) Expenses. The Company will pay all Registration Expenses
in connection with any registration effected pursuant to Article 2 or
Article 3.
(f) Other Approvals. The Company will use its reasonable best
efforts to cause all Warrant Shares covered by such Registration
Statement to be registered with or approved by such other governmental
agencies or authorities as may be necessary to enable the Holder to
consummate the intended disposition of such securities.
(g) Notice of Events. The Company will notify the Holder at
any time when a prospectus relating thereto is required to be delivered
under the Act, upon the Company's discovery that, or upon the happening
of any event as a result of which, the prospectus included in such
Registration Statement, as then in effect, includes an untrue statement
of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made,
and at the request of the Holder promptly prepare and furnish to the
Holder and each underwriter, if any, a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so
that, as thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to
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make the statements therein not misleading in the light of the
circumstances under which they were made.
(h) Listing. The Company will cause all Warrant Shares
covered by the Registration Statement to be listed on each securities
exchange or traded or quoted on each market on which the same class of
securities issued by the Company are then listed, traded or quoted.
(i) Transfer Agent. The Company will provide a transfer
agent, registrar and a CUSIP number for all Warrant Shares no later than
the effective date of such Registration Statement.
SECTION 4.2 DATA FROM THE SHAREHOLDERS. The Company may require the
Holder to furnish the Company, and Holder agrees to provide to the Company,
such information regarding the Holder and the distribution of such securities
as the Company may from time to time reasonably request in writing.
SECTION 4.3 DISCONTINUANCE OF USE OF PROSPECTUS. The Holder agrees by
acquisition of such Warrant Shares that, upon receipt of any written notice
from the Company of the occurrence of any event of the kind described in
Section 4.1(g), the Holder will forthwith discontinue the Holder's offer of
Warrant Shares pursuant to the Registration Statement relating to such Warrant
Shares until the Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 4.1(g) and, if so directed by the Company,
will deliver to the Company (at the Company's expense) all copies, other than
permanent file copies, then in the Holder's possession of the prospectus
relating to such Warrant Shares at the time of receipt of such notice.
SECTION 4.4 UNDERWRITTEN OFFERINGS. If requested by the underwriters
for any underwritten offering by the Holder pursuant to a registration under
Article 2 or Article 3, the Company will enter into an underwriting agreement
with such underwriters for such offering, such agreement to be reasonably
satisfactory in form and substance to the Company, the Holder and the
underwriters, and to contain such representations and warranties by the Company
and such other terms as are generally prevailing in agreements of this type.
The Holder will cooperate with the Company in the negotiation of the
underwriting agreement. The Holder shall be a party to such underwriting
agreement.
SECTION 4.5 PREPARATION; REASONABLE INVESTIGATION. In connection with
the preparation and filing of each Registration Statement under the Act
pursuant to this Agreement, the Company will give the Holder, and its counsel
and accountants, the opportunity to participate in the preparation of such
Registration Statement, each prospectus included therein or filed with the
Commission, and each amendment thereof or supplement thereto.
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ARTICLE 5. INDEMNIFICATION
SECTION 5.1 INDEMNIFICATION BY THE PURCHASER. In the event of any
registration of any securities of the Company under the Act, the Company will,
and hereby does, severally indemnify and hold harmless in the case of any
registration statement filed pursuant to Article 2 or 3, the Holder and each
underwriter, if any, of the Holder's securities, and each person who controls
the Holder or the underwriter within the meaning of Section 15 of the Act,
against any losses, claims, damages or liabilities, joint or several, to which
the Holder may become subject under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement under which such securities were registered under
the Act, any preliminary prospectus, final prospectus or summary prospectus
contained therein, or any amendment or supplement thereto, or any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and the Company
will reimburse the Holder for any legal or any other expenses reasonably
incurred by him in connection with investigating or defending any such loss,
claim, liability, action or proceeding; provided that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability (or action or proceeding in respect thereof) or expense arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in such Registration Statement, any such preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company through an instrument duly executed by the Holder, specifically stating
that it is for use in the preparation thereof and, provided further that the
Company shall not be liable to any Person who participates as an underwriter,
in the offering or sale of Warrant Shares or to any other Person, if any, who
controls such underwriter within the meaning of the Act, in any such case to
the extent that any such loss, claim, damage, liability (or action or
proceeding in respect thereof) or expense arises out of such Person's failure
to send or give a copy of the final prospectus, as the same may be then
supplemented or amended, within the time required by the Act to the Person
asserting an untrue statement or alleged untrue statement or omission or
alleged omission at or prior to the written confirmation of the sale of Warrant
Shares to such Person if such statement or omission was corrected in such final
prospectus. Such indemnity shall remain in full force and effect regardless of
any investigation made by or on behalf of the Holder or any such director,
officer, and shall survive the transfer of such securities by such holder.
SECTION 5.2 INDEMNIFICATION BY THE SELLER. To the extent permitted by
law, the Holder will indemnify the Company, each of its directors and officers,
each underwriter, if any, of the Company's securities covered by such a
Registration Statement, each person who controls the Company or such
underwriter within the meaning of Section 15 of the Act, and each other person
selling the Company's securities covered by such Registration Statement, each
of such person's officers and directors and each person controlling such
persons within the meaning of Section 15 of the Act, against all claims,
losses, damages and liabilities (or actions in respect thereof) arising out of
or based on any untrue statement (or alleged untrue statement) of a material
fact contained in any such Registration Statement, prospectus, offering
circular or other document, or any omission (or alleged omission) to state
therein a material fact required to be stated therein or
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necessary to make the statements therein not misleading, or any violation by
the Holder of any rule or regulation promulgated under the Act applicable to
the Holder and relating to action or inaction required of the Holder in
connection with any such registration, qualification or compliance, and will
reimburse the Company, such other persons, such directors, officers, persons,
underwriters or control persons for any legal or other expenses reasonably
incurred in connection with investigating or defending any such claim, loss,
damage, liability or action, in each case to the extent, but only to the
extent, that such untrue statement (or alleged untrue statement) or omission
(or alleged omission) is made in such Registration Statement, prospectus,
offering circular or other document in reliance upon and in conformity with
written information furnished to the Company by the Holder specifically for use
therein. In addition, insofar as the foregoing indemnity relates to any such
untrue statement (or alleged untrue statement) or omission (or alleged
omission) made in the preliminary prospectus but eliminated or remedied in the
amended prospectus on file with the Commission at the time the Registration
Statement becomes effective or in the final prospectus filed pursuant to
applicable rules of the Commission or in any supplement or addendum thereto,
the indemnity agreement herein shall not inure to the benefit of the Company,
any underwriter if a copy of the final prospectus filed pursuant to such rules,
together with all supplements and addenda thereto, was not furnished to the
person or entity asserting the loss, liability, claim or damage at or prior to
the time such furnishing is required by the Act.
SECTION 5.3 NOTICES OF CLAIMS, ETC. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim referred to in Sections 5.1 or 5.2 such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying
party, give written notice to the latter of the commencement of such action,
provided that the failure of any indemnified party to give notice as provided
herein shall not relieve the indemnifying party of its obligations under
Sections 5.1 or 5.2, except to the extent that the indemnifying party is
actually prejudiced by such failure to give notice. In case any such action is
brought against an indemnified party, unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist in respect of such claim, the indemnifying party
shall be entitled to participate in and to assume the defense thereof, jointly
with any other indemnifying party similarly notified, to the extent that the
indemnifying party may wish, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the consent of the indemnified party, consent to entry of
any judgment or enter into any settlement of any such action which does not
include as an unconditional term thereof the giving by the claimant or
plaintiff to such indemnified party of a release from all liability, or a
covenant not to sue, in respect to such claim or litigation. No indemnified
party shall consent to entry of any judgment or enter into any settlement of
any such action the defense of which has been assumed by an indemnifying party
without the consent of such indemnifying party.
SECTION 5.4 INDEMNIFICATION PAYMENTS. The indemnification required by
this Article 5 shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
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ARTICLE 6. DEFINITIONS
As used herein, unless the context otherwise requires, the following
terms have the following respective meanings:
Act: means the Securities Act of 1933, or any similar Federal
statute, and the rules and regulations of the Commission thereunder, all
as of the same shall be in effect at the time. References to a
particular section of the Securities Act of 1933 shall include a
reference to the comparable section, if any, of any such similar Federal
statute.
Commission: means the Securities and Exchange Commission or any
other Federal agency at the time administering the Securities Act.
Exchange Act: means the Securities Exchange Act of 1934, or any
similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. Reference
to a particular section of the Securities Exchange Act of 1934 shall
include a reference to the comparable section, if any, of any such
similar federal statute.
Person: means a corporation, as association, a partnership, an
organization, business, an individual, a governmental or political
subdivision thereof or a governmental agency.
Registration Expenses: means all expenses incident to the
Company's performance of or compliance with Article 2 or 3, including,
without limitation, all registration, filing, listing, and NASD fees,
all fees and expenses of complying with securities or blue sky laws, all
word processing, duplicating, printing and engraving expenses, messenger
and delivery expenses, the fees and disbursements of counsel for the
Company and of its independent public accountants, including the
expenses of any special audits or "cold comfort" letters required by or
incident to such performance and compliance, premiums and other costs of
policies of insurance against liabilities arising out of the public
offering of the Warrant Shares being registered and any fees and
disbursements of underwriters customarily paid by issuers or sellers of
securities, but excluding underwriting discounts and commissions and
transfer taxes, if any.
Warrant Shares: means the 1,000,000 shares and 2,000,000 shares
of the Company's Common Stock purchased or purchasable by the holder of
the Warrants issued to the Holder dated as of the date hereof upon the
exercise of such Warrants.
ARTICLE 7. MISCELLANEOUS
SECTION 7.1 REMEDIES. The Company agrees that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach hereof
and hereby agrees to
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waive the defense in any action for specific performance of such an obligation
that a remedy at law would be adequate.
SECTION 7.2 ASSIGNMENT. This Agreement shall not be assignable by
either party hereto without the written consent of the other party.
SECTION 7.3 DESCRIPTIVE HEADINGS. The descriptive headings of the
several sections and paragraphs of this Agreement are inserted for reference
only and shall not limit or otherwise affect the meaning hereof.
SECTION 7.4 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED
BY, THE LAWS OF THE STATE OF TEXAS WITHOUT PREJUDICE TO THE PRINCIPLES OF
CONFLICTS OF LAW.
SECTION 7.5 COUNTERPARTS. This Agreement may be executed
simultaneously in any number of counterparts, each of which shall be deemed an
original, but all such counterparts shall together constitute one and the same
instrument.
SECTION 7.6 ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the Company and the Holder and supersedes
all prior agreements and understandings relating to the subject matter hereof.
SECTION 7.7 SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
SECTION 7.8 AMENDMENTS AND WAIVERS. This Agreement may be amended and
the Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if the Company shall have obtained
the written consent of the Holder.
SECTION 7.9 NOTICES. Except as otherwise provided in this Agreement,
all communications provided for hereunder shall be in writing and sent by
first-class mail, postage prepaid, and (a) if addressed to the Holder, at P.O.
Box 27888, Houston, Texas 77227 or (b) if addressed to the Company, 314 N. Post
Oak Lane, Houston, Texas 77024 to the attention of its President.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly authorized
as of the date first above written.
TRANSAMERICAN WASTE INDUSTRIES, INC.
By: /s/ David Green
----------------------------------
Name: J. David Green
--------------------------------
Title: Vice President
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/s/ Robert K. Moses
-------------------------------------
Robert K. Moses, Jr.
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