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Exhibit 10(c)
STANDSTILL AND NON-COMPETITION AGREEMENT
This STANDSTILL AND NON-COMPETITION AGREEMENT ("Agreement") is made and
entered into this 30th day of May, 1995 by and among OHM Corporation, an Ohio
corporation ("OHM"), WMX Technologies, Inc., a Delaware corporation ("WMX"),
and Rust International Inc., a Delaware corporation ("Rust").
WHEREAS, Rust, Rust Remedial Services Inc. ("Remedial"), Enclean
Environmental Services Group, Inc. ("Enclean"), Rust Environmental Inc. and OHM
have entered into that certain Agreement and Plan of Reorganization dated as of
December 5, 1994, as amended (the "Reorganization Agreement") whereby Rust
Environmental shall merge with and into a wholly-owned subsidiary of OHM, OHM
Remediation Services Corp. ("Acquisition") with Acquisition being the
surviving entity and OHM shall issue to Rust or certain of its subsidiaries
shares of its common stock (the "OHM Common Stock");
WHEREAS, OHM and WMX propose to enter into that certain Guarantee Agreement,
dated the date hereof ("Guarantee Agreement"), whereby WMX will agree to
guarantee certain indebtedness of OHM and OHM shall issue to WMX, a warrant to
purchase 700,000 shares of OHM Common Stock (the "Warrant");
WHEREAS, the parties desire to provide for certain agreements with respect
to the ownership and voting by WMX and its affiliates of OHM Common Stock and
other matters after such Merger; and
WHEREAS, in order to induce OHM to enter into the Reorganization Agreement,
WMX and certain of its affiliates are willing to enter into certain agreements
which define the rights of WMX and certain of its affiliates to engage in the
environmental remediation business after such Merger;
WHEREAS, the execution and delivery of this Agreement is a condition of, and
in consideration for, the consummation of the transactions contemplated by the
Reorganization Agreement.
NOW, THEREFORE, in consideration of the agreements, rights, obligations, and
covenants contained herein, OHM, Rust and WMX hereby agree as follows:
1.0 AGREEMENTS REGARDING VOTING AND SHARES
The parties agree that during the Term of this Agreement:
1.1 ACQUISITION OF VOTING SECURITIES. No member of the WMX Group will,
directly or indirectly, acquire Voting Securities or
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securities convertible into or exercisable or exchangeable for Voting
Securities, including the Warrant ("Convertible Securities") (all such Voting
Securities and Convertible Securities owned by members of the WMX Group being
referred to herein as "Restricted Securities"), other than (i) the acquisition
by Rust and/or its subsidiaries of Restricted Securities pursuant to the
Reorganization Agreement, (ii) the acquisition by WMX of the Warrant (but not
including shares of OHM Common Stock upon exercise thereof) pursuant to the
Guarantee Agreement, and (iii) acquisitions of securities (including by
conversion, exercise or exchange of Convertible Securities, including the
Warrant) which do not result in the WMX Group being the Beneficial Owner of
Restricted Securities constituting more than 40% of the Voting Securities then
outstanding (the "Ownership Limit"); provided, however, that if the transaction
resulting in the WMX Group's being the Beneficial Owner of less than the
Ownership Limit was a sale or transfer by the WMX Group of Restricted
Securities (the "Voluntary Transaction"), the percentage ownership of Voting
Securities then outstanding resulting from the consummation of such Voluntary
Transaction shall thereafter be deemed to be the Ownership Limit. In the event
that the WMX Group's ownership of Restricted Securities exceeds the Ownership
Limit, the WMX Group will be obligated to dispose of Restricted Securities as
promptly as practicable in accordance with law in such amount so that the
ownership by the WMX Group of Restricted Securities following such disposition
is equal to or less than the Ownership Limit; provided, however, that the WMX
Group shall not be obligated to dispose of any Restricted Securities if the
aggregate percentage ownership of the WMX Group is increased as a result of (a)
any action taken by any person other than a member of the WMX Group, including
without limitation any recapitalization of OHM, repurchase of Voting Securities
by OHM or any similar transaction; or (b) stock dividends or other
distributions or offerings made available to holders of Voting Securities
generally.
1.2 VOTING. The WMX Group shall take such action as may be required so that
all Restricted Securities at any time entitled to vote are voted:
(a) for the election of the slate of nominees for election to the
Board of Directors of OHM selected by a majority of the directors of OHM
other than the designees of Rust pursuant to Section 2.5 hereof serving
as directors of OHM (such directors so designated by Rust being referred
to herein as the "Rust Directors" and the remaining directors being
referred to herein as the "Other Directors"), provided that such slate
includes the nominees designated by Rust pursuant to Section 2.5 hereof;
and
(b) on all other matters to be voted on by the holders of Voting
Securities, (i) in accordance with the recommendation of a majority of
the Other Directors of OHM
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if any recommendation is made or, (ii) in the absence of a
recommendation, in the same proportion as other stockholders of OHM
shall vote on such matter.
1.3 QUORUM. A representative or representatives of the members of the WMX
Group, as holders of Restricted Securities, shall be present, in person or by
proxy, at any meeting of shareholders of OHM so that all Restricted Securities
may be counted for the purpose of determining the existence of a quorum at such
meeting.
1.4 VOTING TRUST OR ARRANGEMENT. No member of the WMX Group shall deposit
any Restricted Securities in a voting trust or subject any Restricted
Securities to any arrangement or agreement with respect to the voting of such
Restricted Securities.
1.5 PROXY SOLICITATIONS. No member of the WMX Group shall solicit proxies
or initiate, propose or become a "participant" in a "solicitation" (as such
terms are defined in Regulation 14A under the Securities Exchange Act of 1934,
as amended, or any similar successor statute (the "Exchange Act")), in
opposition to any matter which has been recommended by a majority of the Other
Directors or in favor of any matter which has not been approved by a majority
of the Other Directors or seek to advise, encourage or influence any Person
with respect to the voting of Voting Securities in such manner, or induce or
attempt to induce any Person to initiate any stockholder proposal.
1.6 GROUP PARTICIPATION. No member of the WMX Group shall join a
partnership, limited partnership, syndicate or other group, or otherwise act in
concert with any other person, for the purpose of acquiring, holding, voting or
disposing of Voting Securities (other than solely with members of the WMX Group
in a manner consistent with the purposes hereof).
1.7 SOLICITATIONS OF OFFERS. No director or executive officer of any member
of the WMX Group shall, and no member of the WMX Group shall permit any of its
other officers, employees or agents (including investment bankers) to, induce
or attempt to induce or give encouragement to any third person, or enter into
any serious substantive discussions or negotiations with any third person, in
furtherance of any tender offer or business combination transaction in which
shares of Voting Securities would be acquired; provided, however, that nothing
in this Section 1.7 shall, or shall be construed, directly or indirectly, to
limit any rights of the WMX Group to offer, sell or otherwise dispose of shares
of Restricted Securities pursuant to any transaction effected in accordance
with Section 1.8 hereof.
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1.8 DISPOSITIONS:
(a) WMX hereby agrees that, except as otherwise permitted by this
Agreement, no member of the WMX Group shall, directly or indirectly, offer,
sell, transfer or hypothecate shares of Restricted Securities other than as
follows:
(i) to other members of the WMX Group;
(ii) in a distribution registered under the Securities Act in which such
Restricted Securities are offered and sold to the general public;
(iii) in compliance with Rule 144 of the General Rules and Regulations under
the Securities Act (or any similar successor rule); provided, however, that
WMX shall notify OHM at least three business days prior to the date of
entering any sale or transfer order in respect of Restricted Securities
pursuant to Rule 144 (or such successor rule), and provided further that, if
OHM shall thereupon notify the WMX Group of the pendency of a sale or any
public offering by OHM of Voting Securities, no member of the WMX Group
shall effect any sales of Restricted Securities under such rule within 10
calendar days prior to the commencement of or during such offering;
(iv) a merger or consolidation, approved by a majority of the Other
Directors, in which OHM is acquired;
(v) in a sale or sales to any person approved by a majority of the Other
Directors; or
(vi) in privately negotiated transactions in which Restricted Securities
are not sold or transferred to any other person or group who or which would
immediately thereafter, to the knowledge of the WMX Group after reasonable
inquiry, beneficially own or have the right to acquire more than 5% of the
Voting Securities then outstanding, unless such other person agrees to
execute and deliver to OHM an agreement containing obligations similar to
the obligations of the WMX Group contained in this Article 1, which
agreement shall be approved by a majority of the Other Directors;
provided, however, that in any transaction or transactions described in clauses
(ii) or (iii), the WMX Group will use its reasonable efforts to effect the
transfer thereof in a manner which will effect the broadest possible
distribution with no sales or transfers of Restricted Securities to any person
or
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group of persons (within the meaning of Section 13(d) of the Exchange Act) in
excess of 5% of the then outstanding Voting Securities.
1.9 LEGENDS, STOP TRANSFER ORDERS AND NOTICE. The WMX Group agrees:
(a) to the placement on the certificate or other instrument
representing Restricted Securities of the following legend:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933 and may not be sold or
transferred except in compliance with such Act. The securities
represented by this certificate are subject to the provisions of an
Agreement, dated ____________, 1995 among OHM Corporation, Rust
International Inc. and WMX Technologies, Inc., a copy of which is on
file at the office of the Secretary of OHM Corporation.
(b) to the entry of stop transfer orders with the transfer agent (or
agents) and the registrar (or registrars) of OHM against the transfer other
than in compliance with the requirements of this Agreement of legended
securities of which the WMX Group from time to time is the Beneficial Owner.
(c) OHM agrees to the removal of the legend required by Section
1.9(a) and the stop transfer orders in Section 1.9(b) hereof following the
later of three years from the date of Closing or the expiration of the Term
of the Agreement.
2.0 OTHER AGREEMENTS REGARDING VOTING STOCK
2.1 ANTI-DILUTION OPTIONS.
(a) In the event the WMX Group is the Beneficial Owner of Restricted
Securities constituting less than 20% of all Voting Securities then
outstanding, OHM hereby grants to Rust a cumulative, continuing option (the
"Anti-Dilution Option") to purchase (or to have its affiliate or nominee
purchase) that number of shares as may be necessary, when added to all other
shares of which the WMX Group shall on the relevant date be the Beneficial
Owner (not including the Warrant or shares underlying the unexercised
Warrant), to enable the WMX Group to be the Beneficial Owner of Restricted
Securities (not including the Warrant or shares underlying the unexercised
Warrant) constituting not less than 20% and not more than 21% of all Voting
Securities outstanding after the exercise of the Anti-Dilution Option.
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OHM agrees to notify Rust, as provided in Section 6.3 hereof, promptly upon
becoming aware that the WMX Group is the Beneficial Owner of Restricted
Securities (not including the Warrant or shares underlying the unexercised
Warrant) constituting less than 20% of the then outstanding Voting Securities
(the "OHM Notice"). The Anti-Dilution Option may be exercised by Rust by
written notice to OHM and shall be exercisable for a period commencing on the
date that the WMX Group is the Beneficial Owner of Restricted Securities (not
including the Warrant or shares underlying the unexercised Warrant)
constituting less than 20% of the then outstanding Voting Securities and
continuing for a period of ten business days following the date that Rust has
received the OHM Notice (the "Option Period") ; provided, however, that in
the event that, during the Option Period, OHM has not released to the public
material information which, in the reasonable judgment of OHM is reasonably
likely to have a material and adverse effect upon the price of the Voting
Securities, OHM will extend the Option Period until the date which is two
business days following the release of such material information to the
public. The Anti-Dilution Option shall be terminated if the transaction
resulting in the WMX Group being the Beneficial Owner of less than 20% of all
Voting Securities (not including the Warrant or shares underlying the
unexercised Warrant) was a sale or transfer of Voting Securities by the WMX
Group or if the WMX Group sells or transfers, and thereby reduces, any or all
of its beneficial ownership of Restricted Securities at a time when the WMX
Group was the Beneficial Owner of Restricted Securities (not including the
Warrant or shares underlying the unexercised Warrant) constituting less than
20% of all Voting Securities or any Option Period shall have expired without
Rust exercising such Anti-Dilution Option. It is the intention of the
parties hereto that the existence and exercise, from time to time, of an
Anti-Dilution Option, in combination with the WMX Group's right herein to
designate persons to OHM's Board of Directors shall assist the WMX Group in
accounting for its ownership in OHM on the equity method.
(b) The price per share payable upon each exercise of an Anti-Dilution
Option shall be an amount equal to the average closing price per share of the
Voting Securities for the five trading days prior to the date that Rust
notifies OHM that it is exercising the Anti-Dilution Option on the New York
Stock Exchange or other nationally recognized exchange or over-the-counter
market on which the Voting Securities primarily trade and shall be payable by
wire transfer in immediately available funds to an account designated by OHM.
(c) The Voting Securities issued pursuant to an exercise of an
Anti-Dilution Option shall be duly
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authorized, validly issued and fully paid and non-assessable.
(d) OHM shall reserve for issuance at all times during the period any
Anti-Dilution Option is exercisable that number of Voting Securities equal to
the number of Restricted Securities issuable upon exercise of each
Anti-Dilution Option.
2.2 INDEPENDENT DIRECTORS. For so long as the WMX Group owns at least 20%
of the outstanding Voting Securities, WMX shall take such action as may be
reasonably within its control so that OHM's Board of Directors at all times
includes at least three directors not affiliated with the WMX Group or employed
by OHM or its subsidiaries (the "Independent Directors").
2.3 TRANSACTIONS WITH OHM. For so long as the WMX Group is the Beneficial
Owner of at least 20% of the outstanding Voting Securities, no member of the
WMX Group shall attempt to enter, or enter into any material transaction or
agreement, out of the ordinary course of business, other than transactions
contemplated by Section 2.4 hereof, with OHM or its subsidiaries unless such
transaction or agreement is approved by a majority of the Independent Directors
or a committee including only Independent Directors.
2.4 WMX GROUP ACQUISITION OF ADDITIONAL VOTING SECURITIES. For so long as
the WMX Group is the Beneficial Owner of at least 20% of the outstanding Voting
Securities and whether or not the Term of the Agreement for purposes of Article
1 hereof has expired, no member of the WMX Group shall, directly or indirectly,
propose to purchase, attempt to purchase or purchase or otherwise acquire any
Voting Securities (including by conversion of securities convertible into
Voting Securities, by merger or by other business combination), or make any
public announcement with respect thereto, except acquisitions to the Ownership
Limit pursuant to Section 1.1 hereof, unless (i) such purchase or other
acquisition is pursuant to an offer for all of the outstanding Voting
Securities at the same price per share and (ii) such purchase or other
acquisition is either (x) approved by the Independent Directors or a committee
including only Independent Directors or (y) if not so approved, approved by a
majority of the outstanding Voting Securities (other than the Restricted
Securities beneficially owned by the WMX Group) at a meeting of shareholders
called for that purpose pursuant to the provisions of Article X of OHM's
Amended and Restated Articles of Incorporation in effect on the date hereof.
2.5 BOARD REPRESENTATION. Immediately following the Closing Date, OHM will
elect to its Board of Directors three qualified designees of the WMX Group
mutually acceptable to the WMX Group and OHM. Thereafter, for so long as the
WMX Group is the Beneficial Owner of at least 20% of the outstanding Voting
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Securities or the Anti-Dilution Option has not expired, OHM will include among
its Board of Directors' nominees for election a number of qualified designees
acceptable to the WMX Group and OHM such that the percentage of the Board of
Directors proposed to be composed of such designees is proportionately equal
(to the lowest corresponding whole directorship) to the percentage of
outstanding Voting Securities which the WMX Group then has Beneficial
Ownership.
2.6 LISTING ON SECURITIES EXCHANGES. For so long as the WMX Group is the
Beneficial Owner of at least 20% of the outstanding Voting Securities, OHM will
list the Restricted Securities, and will maintain the listing thereof, on each
national securities exchange on which any Common Stock may be listed, subject
to official notice of issuance, the Restricted Securities.
2.7 FILE REPORTS AND COOPERATE IN RULE 144 TRANSACTIONS. For as long as the
WMX Group shall continue to hold any Voting Securities, OHM shall use
reasonable efforts to file on a timely basis all annual, quarterly and other
reports required to be filed by it under Sections 13 and 15(d) of the Exchange
Act, and the Rules and Regulations of the Commission thereunder, as amended
from time to time. In the event of any proposed sale of Voting Securities by
any member of the WMX Group pursuant to Section 1.8(a)(iii) above, OHM shall
cooperate with the WMX Group so as to enable such sales to be made in
accordance with applicable laws, rules and regulations, the requirements of
OHM's transfer agent and the reasonable requirements of the broker through
which the sales are proposed to be executed, and shall, upon request, furnish
unlegended certificates representing Voting Securities in such numbers and
denominations as the transferor shall reasonably require for delivery pursuant
to such sales.
2.8 DEFINITIONS. For purposes of Article 1 and Article 2 of this Agreement,
the following terms shall have the following meanings.
(a) Affiliate. "Affiliate" shall have the meaning ascribed to it in
Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in
effect on the date hereof.
(b) Beneficial Owner. A person shall be deemed a "Beneficial Owner"
of or to have "Beneficially Owned" any Voting Securities (i) in accordance
with the term "beneficial ownership" as defined in Rule 13d-3 under the
Exchange Act, as in effect on the date hereof, and (ii) shall also include
Voting Securities which such person or any Affiliate of such person has the
right to acquire (whether such right is exercisable immediately or only after
the passage of time) pursuant to any agreement, arrangement
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or understanding or upon the exercise of conversion rights, exchange
rights, warrant or options, or otherwise.
(c) Person. A "person" shall mean any individual, firm,
corporation, partnership or other entity.
(d) Term of this Agreement. "Term of this Agreement" for purposes
of Article 1 hereof, but not for Article 2 hereof, shall mean a period
commencing with the date of this Agreement and ending on the first to occur
of (i) the failure of OHM to pay, upon the expiration of a ten (10) day
grace period following OHM's receipt of a written demand, a copy of which
shall be sent to the Independent Directors, any of OHM's Reimbursement
Obligations as such term is defined in the Guarantee Agreement following
the payment by WMX of any amounts under the guarantee or guarantees
provided for in Section 9.6 of the Reorganization Agreement, or (ii) the
date that the WMX Group is the Beneficial Owner of Restricted Securities
constituting less than 20% of the then outstanding Voting Securities and
the Option Period has expired without exercise of the Anti-Dilution
Option.
(e) Voting Securities. "Voting Securities" includes Common Stock
and any other securities of OHM entitled to vote generally for the election
of directors, in each case now or hereafter outstanding.
(f) WMX Group. "WMX Group" shall mean WMX, Rust and their
respective Affiliates (regardless of whether such person is an Affiliate on
the date hereof), both in their individual capacities and collectively. An
individual shall not be deemed to be an Affiliate for purposes of this
definition if such individual is the Beneficial Owner of less than 50,000
shares of Voting Securities solely for investment purposes and is not a
member of a "group" which includes the WMX Group as defined by Section
13(d) of the Exchange Act.
3.0 CERTAIN BUSINESS AGREEMENTS
3.1 WMX AND AFFILIATES RESTRICTIVE COVENANTS.
(a) Neither WMX nor Rust, or their respective wholly-owned
(directly or indirectly) subsidiaries, which do not include Wheelabrator
Technologies Inc. and Waste Management International plc and their
respective subsidiaries (collectively, the "WMX Affiliates") shall, for a
period of seven years from the Closing Date, engage in North America in the
business of providing field services for the on-site remediation of
hazardous waste, radioactive materials, mixed waste, waste contaminated
with petroleum, hydrocarbons, crude oil, PCBs, or any "Hazardous
Substances" as such term is defined in the Comprehensive Environmental
Response,
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Compensation and Liability Act of 1980 as amended ("CERCLA") (individually
and collectively, "Contaminants"), which services involve the on- site
treatment (in-situ, ex-situ, chemical, physical, thermal, biological or
otherwise), neutralization, destruction, recharacterization, detoxifying,
dewatering, excavation or staging (for removal, storage, treatment,
disposal or otherwise) of Contaminants, whether or not such services (i)
are provided on an emergency response, planned, on-going, periodic, or
other basis, or (ii) are provided for private sector or governmental
clients, including without limitation, state and local governments and
federal government agencies such as the Department of Defense, the
Department of Energy, Department of the Interior, and the Environmental
Protection Agency (the "Business"); provided, however, that the Business
shall not include (A) services for loading, removal and transportation to
an off-site treatment, storage or disposal facility of Contaminants which
have already been staged or prepared (in drum, bulk or otherwise) for such
removal and transportation, (B) services typically performed in the
industrial cleaning and maintenance services businesses or nuclear service
business at operating chemical, industrial, manufacturing, refining,
utility or other operating facilities in connection with the servicing for,
or support of such facilities (e.g.: routine maintenance; industrial
cleaning; special services such as filter pressing, centrifuging and drying
of various wastes; cleaning of lagoons and tanks for re-use; packaging of
wastes related to these services for storage on-site or shipment off-site);
(C) services performed in the decontamination or decommissioning of nuclear
power plants in the electric utilities industry; (D) services provided
in-plant for the analysis, management and staging for transportation or
disposal at an off-site treatment, or disposal facility of Contaminants
which are generated in the ordinary course of an on-going manufacturing or
industrial process; (E) services provided by a WMX Affiliate incidental to
the on-going operations of a treatment, storage or disposal facility owned
or operated by such WMX Affiliate in the ordinary course of the business of
such facility, (F) engineering, design, program management, or construction
management services typically performed in connection with an environmental
restoration program; (G) on-site environmental remediation services which
are provided by a contractor or other person not directly or indirectly
affiliated with a WMX Affiliate under a subcontract or teaming arrangement
with a WMX Affiliate, provided that Rust has complied with its obligations
under Section 3.3 hereof with respect to such services; or (H) on site
environmental remediation services in connection with and incidental to
services of the type described in (A) and (B) above; provided that the
price for such remediation services (excluding the price of waste
loading, removal,
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transportation and disposal) does not exceed $100,000 per project.
(b) Notwithstanding anything in this Agreement to the contrary,
neither WMX nor any WMX Affiliate shall be prohibited from acquiring the
capital stock or assets of any other entity unless such entity's
predominate business is the Business and provided, further, that if WMX or
the WMX Affiliate shall acquire the capital stock or assets of any other
entity engaged in the Business, WMX or the WMX Affiliate shall promptly
offer to sell such Business to OHM at a price equal to the fair market
value thereof. WMX or the WMX Affiliate shall make such offer by giving OHM
prompt written notice of such offer, disclosing all material information
pertaining to such Business, the fair market value thereof, and such other
terms and conditions to such offer as may be reasonable. OHM shall have a
period of 60 days after receipt of such notice to elect to purchase such
Business at such price and on such terms and conditions, which election
shall be in writing and shall be signed by a duly authorized officer of
OHM. Should OHM fail to purchase such Business, WMX or the WMX Affiliate
shall nevertheless be required to dispose of such Business.
(c) Notwithstanding the failure by OHM to purchase any Business
pursuant to the preceding paragraph, prior to selling any Business to any
third party, WMX or the WMX Affiliate shall give OHM prompt written notice
of any such proposed sale or other disposition of a Business, disclosing
all material information pertaining to such third party sale, including,
without limitation, the price and other terms and conditions of such sale,
and offering to sell such Business to OHM for such price and on such terms
and conditions. OHM may elect within 15 days following receipt of such
notice (the "Option Period") to purchase such Business at such price and on
such terms and conditions as were contemplated in the third party sale,
which election shall be in writing and shall be signed by a duly authorized
officer of OHM. If OHM shall not have exercised its right to purchase in
accordance with the preceding sentence, WMX or the WMX Affiliate may,
within 90 days of the expiration of the Option Period, enter into a binding
agreement to sell or otherwise dispose of such Business to (but only to)
the person who was the subject of the third party sale upon (but only upon)
the material terms and conditions offered to OHM pursuant to the preceding
sentence. If for any reason such a binding agreement shall not have been
entered into within such 90-day period or the transaction contemplated
thereby shall not be consummated, WMX or the WMX Affiliate shall be
obligated to offer OHM the opportunity to purchase such Business in
accordance with the terms of this paragraph before making any sale or
disposition of such Business, whether to the same third party or to a
different third
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party and whether on the same material terms and conditions or on different
terms and conditions.
(d) Neither WMX nor the WMX Affiliates shall, for a period commencing
from the date of this Agreement and ending two years following the Closing
Date, solicit, employ or offer employment to or agree to employ any employee
of the Division other than an employee of the Division who is not offered
employment by OHM or its subsidiaries immediately following the Closing.
3.2 BLUE PENCIL PROVISIONS. If any provision of Section 3.1, as applied to
any party or to any circumstances, is adjudged by a court to be invalid or
unenforceable, the same will in no way affect any other provision of the said
Section 3.1 or any other part of this Agreement, the application of such
provision in any other circumstances, or the validity or enforceability of this
Agreement. If any such provision, or any part thereof, is held to be
unenforceable because of the duration of such provision or the area covered
thereby, the parties agree that the court making such determination will have
the power to reduce the duration and/or area of such provision, and/or to
delete specific words or phrases, and in its reduced form such provision will
then be enforceable and will be enforced. Upon breach of any provision of
Section 3.1, the other party hereto will be entitled to injunctive relief,
since the remedy at law would be inadequate and insufficient. In addition,
such other party will be entitled to such damages as it can show it has
sustained by reason of such breach.
3.3 PREFERRED PROVIDER STATUS. For so long as the WMX Group owns at least
20% of the outstanding Voting Securities, WMX, on behalf of itself and the WMX
Affiliates, agrees and agrees to cause the WMX Affiliates to agree that OHM
will be a Preferred Provider with respect to any and all services coming within
the scope of the Business, as defined in Section 3.1 (whether as prime
contractor, subcontractor or otherwise) that WMX or the WMX Affiliates contract
for, control, direct, influence or subcontract, provided it is not violative of
law, rule, regulation or other contractual obligations. Rust shall provide OHM
and its subsidiaries access to and the services of its engineering, consulting,
design and project management services personnel on the same basis and at the
same cost as Rust provides them to the WMX Affiliates. For so long as the WMX
Group owns at least 20% of the outstanding Voting Securities, OHM, on behalf of
itself and its subsidiaries (the "OHM Affiliates"), agrees and agrees to cause
the OHM Affiliates to agree, that WMX Affiliates will be a Preferred Provider
with respect to all engineering, consulting and design, environmental and waste
management services commonly provided by the WMX Affiliates (whether as prime
contractor, subcontractor or otherwise) that OHM or the OHM Affiliates contract
for, control, direct, influence or subcontract, provided it is not violative of
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law, rule, regulation or other contractual obligations. As used herein, the
term "Preferred Provider" means that the person purchasing or contracting for
such services (the "Purchaser") shall not purchase such services from any third
party unless the Purchaser has reasonably determined in good faith that the
overall value, in terms of price, terms and conditions, quality, documentation,
service and other matters, of such services from parties other than the
Preferred Provider significantly exceeds the value of such services available
from the Preferred Provider, provided that the Purchaser shall be excused from
the foregoing obligation with respect to any specific provision of services if
(i) the Preferred Provider has failed to respond within a reasonable period of
time to a request by the Purchaser for a price quotation or other terms or
information with respect to the services or has failed to commit to provide
such services within the time period in which the Purchaser shall have required
such services to be provided, which time period, in either case, shall not be
substantially shorter than the time period that the Purchaser would have
required from or allowed to a third party or, if the Preferred Provider shall
have made no such commitment, within a reasonable period of time after the
Purchaser has requested them, or (ii) in the Purchaser's reasonable, good faith
judgment, the particular project or product is not appropriate for the
Preferred Provider in light of the nature of the Preferred Provider's expertise
and experience with similar projects.
3.4 GUARANTEED REMEDIATION PROJECTS. During the period commencing on the
Closing Date and ending on December 31, 1996, WMX shall, or shall cause its
affiliates to, contract with OHM to provide environmental remediation services
to WMX or its affiliates involving revenues to OHM prior to December 31, 1996
of at least $20,000,000 with respect to services typically performed by OHM
(the "Revenue Amount"). Such services shall be performed at mutually agreed
upon rates, which may include as appropriate and as mutually agreed to rates
established from time to time by OHM's government cost accounting system
("OHM's Government Rates"). In the event WMX shall have contracted, or caused
its affiliates to contract with OHM for environmental remediation services
which involve an amount of revenues to OHM prior to December 31, 1996, which
are in an amount less than the Revenue Amount (the "Revenue Shortfall"), WMX
shall pay to OHM an amount equal to 10% of the difference between the Revenue
Amount and the Revenue Shortfall.
4.0 REPRESENTATIONS AND WARRANTIES OF OHM.
OHM represents and warrants to Rust and WMX as follows:
4.1 CORPORATE EXISTENCE, DUE AUTHORIZATION, AND EXECUTION OF OHM. OHM
is a corporation duly organized, validly existing, and in good standing under
the laws of the State of Ohio, with full corporate power and authority to
execute and deliver this
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Agreement and all other agreements to be delivered by OHM, to perform OHM's
obligations hereunder and thereunder, and to consummate the transactions
contemplated hereby and thereby. This Agreement and each of the other
agreements contemplated hereby and the consummation of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action of OHM. This Agreement has been duly executed and delivered by
OHM and will, after approval by its shareholders, constitute a legal, valid,
and binding obligation of OHM, enforceable against OHM in accordance with its
terms.
4.2 NO CONFLICTS. The execution and delivery of this Agreement and each
of the other agreements contemplated hereby and the consummation of the
transactions contemplated hereby and thereby will not conflict with, or result
in any violation of or default under, any provision of the Restated Articles of
Incorporation or Regulations of OHM, or of any agreement or instrument binding
upon OHM.
5.0 REPRESENTATIONS AND WARRANTIES OF WMX AND RUST.
5.1 CORPORATE EXISTENCE, DUE AUTHORIZATION, AND EXECUTION OF RUST. Rust
and WMX are corporations duly organized, validly existing, and in good standing
under the laws of the State of Delaware, with full corporate power and
authority to execute and deliver this Agreement and all other agreements to be
delivered by them, to perform their obligations hereunder and thereunder, and
to consummate the transactions contemplated hereby and thereby. This Agreement
and each of the other agreements contemplated hereby and the consummation of
the transactions contemplated hereby and thereby will, at the Closing, have
been duly authorized by all necessary corporate action of Rust and WMX,
respectively. This Agreement has been duly executed and delivered by Rust and
WMX, respectively, and constitutes a legal, valid, and binding obligation of
each of them, enforceable against each of them in accordance with its terms.
5.2 NO CONFLICTS. The execution and delivery of this Agreement and each
of the other agreements contemplated hereby and the consummation of the
transactions contemplated hereby and thereby will not conflict with, or result
in any violation of or default under, any provision of the Certificate of
Incorporation or By-Laws of Rust or WMX, or of any agreement or instrument
binding upon Rust, WMX or their affiliates.
6.0 MISCELLANEOUS.
6.1 SPECIFIC ENFORCEMENT. The parties acknowledge and agree that OHM
would be irreparably damaged in the event any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that OHM shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to
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specifically enforce this Agreement and the terms and provisions thereof in any
action instituted in any court of the United States or any state thereof having
subject matter jurisdiction, in addition to any other remedy to which OHM may
be entitled, at law or in equity.
6.2 MODIFICATION; WAIVER. This Agreement may be modified in any manner
and at any time by written instrument executed by the parties hereto. Any of
the terms, covenants, and conditions of this Agreement may be waived at any
time by the party entitled to the benefit of such term, covenant, or condition.
6.3 NOTICES. All notices, requests, demands, claims, and other
communications hereunder shall be in writing and shall be delivered by
certified or registered mail (first class postage pre-paid), guaranteed
overnight delivery, or facsimile transmission:
(a) if to OHM to:
16406 U.S. Route 224 East
Findlay, Ohio 45840
Attention: General Counsel
Telecopy: (419) 424-4985
(b) if to Rust to:
100 Corporate Parkway
Birmingham, Alabama 35242
Attention: General Counsel
Telecopy: (205) 995-7914
(c) if to WMX to:
3003 Butterfield Road
Oak Brook, Illinois 60521
Attention: General Counsel
Telecopy: (708) 218-1553
(d) or, in each case, at such other address or to such other
person as may be specified in writing to the other party.
6.4 PARTIES IN INTEREST; ASSIGNMENT. This Agreement and all the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns, but neither this
Agreement nor any of the rights, interests, and obligations hereunder shall be
assigned by any of the parties hereto without the prior written consent of the
other parties hereto. Nothing in this Agreement, whether expressed or implied,
shall be construed to give any person other
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than the parties hereto any legal or equitable right, remedy, or claim under or
in respect of this Agreement.
6.5 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall constitute one and the same instrument.
6.6 HEADINGS. The article and section headings of this Agreement are for
convenience of reference only and shall not be deemed to alter or affect the
meaning or interpretation of any provisions hereof.
6.7 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Ohio applicable to contracts
made and to be performed therein.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
OHM CORPORATION
By: /s/ Randall M. Walters
--------------------------
Title: Vice President
RUST INTERNATIONAL INC.
By: /s/ Michael T. Brown
--------------------------
Title: Vice President
WMX TECHNOLOGIES, INC.
By: /s/ Linda R. Witte
--------------------------
Title: Vice President
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