exv10w32



 



Exhibit 10.32


TRANSITION SERVICES AGREEMENT



     This is a Transition Services Agreement (the “Agreement”) dated July 31,
2003 between ERP Environmental Services Inc. (“Services”), a Delaware
corporation, and U S Liquids, Inc. (“USL”), a Delaware corporation, regarding
(a) rental of real and tangible personal property, and services of employees,
that USL and its subsidiaries will provide to Services and its subsidiaries
(including Romic Environmental Technologies Corporation, Parallel Products of
Kentucky, Inc., Parallel Products of California, Inc., and U S Liquids of La.,
L.P.) during the period of six months beginning on the date of this Agreement
and ending on, and including, the sixth monthly anniversary of the date of this
Agreement (the “Transition Period”), and (b) services of employees that
Services and its subsidiaries will provide to USL and its subsidiaries during
the Transition Period. The agreement between Services and USL is as follows:


1.     Items Provided by USL. During the Transition Period, USL will provide, or
will cause its subsidiaries to provide, the following to Services and its
subsidiaries:


     1.1    Rental of space at USL’s corporate office described on Schedule 1.1
(“USL Corporate Office”).


     1.2    Rental, on an exclusive basis, of the tangible personal property
described on Schedule 1.2 (the “Rental Property”), together with the right to
use all owned and licensed software and other intellectual property required to
use the Rental Property (to the extent allowed by third-party licensors), and
together with access, as reasonably requested, on an as needed basis during
normal business hours to the services of personnel of USL Corporate Office who
are familiar with the operation of the Rental Property (to the extent they are
not included in the personnel described in Section 1.4). USL will not be
required to purchase or replace any of the Rental Property.


     1.3    Use, on a non-exclusive basis, of the tangible personal property
described on Schedule 1.3 (the “Other Personal Property”), together with the
right to use of all owned and


 






 




licensed software and other intellectual property required to use the
Other Personal Property (to the extent allowed by third-party licensors), and
together with access, as reasonably requested, on an as needed basis during
normal business hours to the services of personnel of USL Corporate Office who
are familiar with the operation of the Other Personal Property (to the extent
they are not included in the personnel described in Section 1.4).


     1.4    Access, as reasonably requested, during normal business hours to the
personnel of USL Corporate Office listed on Schedule 1.4 at such Services
personnel’s regular place of employment, provided that access to those
personnel is scheduled so that it does not prevent those Services personnel
from fulfilling their responsibilities to USL and its subsidiaries.


     1.5    The services provided by USL or its subsidiaries shall not include the
use of USL personnel to transition from USL’s facility to another location or
office, provided however that USL personnel will assist with Services’
transition from USL’s network server to a network server of its own.


     1.6    Nothing in Section 1.4 will prevent USL and its subsidiaries from
terminating the employment of any of the persons listed on Schedule 1.4, or
require USL to make the services of any of those persons available to Services
or its subsidiaries after their employment by USL and its subsidiaries
terminates, if USL gives Services at least 15 days prior notice of USL’s
intention to terminate the employment of persons listed on Schedule 1.4 (unless
the termination is a result of disciplinary action). USL consents to
Services’ offering, after USL and its subsidiaries terminate the employment of
any of the persons listed on Schedule 1.4, to employ that person on a
temporary or permanent basis. However, Services will not be required to offer
to employ any of those persons, and USL will have no obligation to ensure that,
if Services offers to employ any of those persons, they will accept the offers
of employment.


2.     Payments to USL.


     2.1    In order to compensate USL for providing the rental of space in USL’s
corporate office, use of software and other intellectual property required to
use the Rental Property and


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Other Personal Property the services of personnel as described in Sections
1.1 through 1.4, (a) on each of the first through sixth monthly anniversaries
of the date of this Agreement, Services will pay USL the sum of $333,333.33 (a
total of $2,000,000), and (b) Services and its subsidiaries will provide USL,
without charge, access to personnel as described in Article 3. The obligations
of Services under this Section will not be reduced or otherwise affected by the
fact that USL or its subsidiaries may terminate the employment of some, or even
of all, the persons listed on Schedules 1.4.


     2.2    Any sum due under Section 2.1 that is not paid within 5 days after it
is due will bear interest from the day it is due until the day it is paid at
12.5% per annum.


     2.3    Services will reimburse USL for any frame relay charges incurred by
USL in connection with its use of or access to USL’s network server pursuant to
this Agreement and the Software License.


     2.4    Services will be responsible for fifty percent of sales, use or
similar taxes, if any, under this Agreement and will indemnify USL for that
fifty percent of any such taxes.


3.     Items Provided by Services. During the Transition Period, Services will
provide, or will cause its subsidiaries to provide, the following to USL and
its subsidiaries:


     3.1    Access, as requested, during normal business hours to the personnel of
Services or its subsidiaries listed on Schedule 3.1, provided the access to
those personnel is scheduled so that it does not prevent those personnel from
fulfilling their responsibilities to Services and its subsidiaries in a manner
consistent with the way they were fulfilling those responsibilities at the date
of this agreement to companies that become subsidiaries of Services.


     3.2    Nothing in Section 3.1 will prevent Services and its subsidiaries from
terminating the employment of any of the persons listed on Schedule 3.1, or
require Services or its subsidiaries to make the services of any of those
persons available to USL or its subsidiaries after their employment by Services
and its subsidiaries terminates, if Services gives USL at


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least 15 days prior notice of Services’ intention to terminate the
employment of particular persons (unless the termination is a result of
disciplinary action). Services consents to USL’s offering, after Services
and its subsidiaries terminate the employment of any of the person listed on
Schedule 3.1, to employ that person on a temporary or permanent basis.
However, USL will not be required to offer to employ any of those persons, and
Services will have no obligation to ensure that, if Services offers to employ
any of those persons, they will accept the offers of employment.


4.     General.


     4.1    Standard of Performance. USL and Services each will use commercially
reasonable efforts to ensure that all services provided by it or its
subsidiaries under this Agreement will be at a level of quality and timeliness
that is consistent with past practice.


     4.2    Maintenance of Equipment. Both parties agree to (a) ensure that, to
the fullest extent commercially practicable, the Rental Property will be
maintained in good operating condition, reasonable wear and tear excluded,
throughout the Transition Period, and (b) will be responsible for providing
general office supplies needed in the ordinary course in connection with the
operation of that machinery and equipment (other than supplies, such as
imprinted billhead, that are proprietary to the user).


     4.3    Cooperation and Access. The parties will cooperate with each other in
all reasonable respects with regard to all matters relating to rental of the
USL Corporate Office, Rental Property and Other Personal Property, and the
provision and receipt of services, in accordance with this Agreement. That
cooperation will include obtaining any required third party consents, licenses,
sublicenses or approvals (including rights to use third party software). If a
party is not able to obtain any required third party consent, license,
sublicense or approval, it will use commercially reasonable efforts to arrive
at an alternate means of satisfying its obligations under this Agreement that
will not require that third party consent, license,


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sublicense or approval provided that no party shall be required to incur
any additional costs to have satisfied its obligations under this provision.


     4.4    Indemnification by USL. From and after the date of this Agreement,
USL shall indemnify, defend and hold harmless Services, and its respective
directors, officers and employees from and against any and all fines, fees,
penalties, charges, expenses, demands, actions, proceedings, suits (by any
person, entity or group, including, without limitation, any governmental
entity) and liabilities, paid or incurred, resulting from or arising out of
action or claim (including, without limitation, the reasonable costs and
expenses of defending any and all actions, suits, proceedings, demands,
assessments, judgments, settlements and compromises arising out of action or
claims, and reasonable attorneys’ fees and expenses in connection therewith)
relating to, resulting from or arising out of, (i) fraud, theft, embezzlement
or acts of gross negligence or willful misconduct by officers, employees or
agents of USL during the term of this Agreement, (ii) failure to perform the
transition services or take the actions required by this Agreement during the
term of this Agreement, (iii) personal injuries or death or material damages to
property, in any way incident to or in connection with or arising out of the
presence of any of USL’s employees, contractors or agents on USL’s premises,
provided, however, that the foregoing shall not be interpreted to require USL
to indemnify Services against the negligence or willful misconduct of Services,
its subsidiaries, employees, contractors, agents resulting in personal injuries
or death or material damages to property.


     4.5    Indemnification by Services. From and after the date of this
Agreement, Services shall indemnify, defend and hold harmless USL, and its
respective directors, officers and employees from and against any and all
fines, fees, penalties, charges, expenses, demands, actions, proceedings, suits
(by any person, entity or group, including, without limitation, any
governmental entity) and liabilities, paid or incurred, resulting from or
arising out of action or claim (including, without limitation, the reasonable
costs and expenses of defending


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 any and all actions, suits, proceedings, demands, assessments, judgments,
settlements and compromises arising out of action or claims, and reasonable
attorneys’ fees and expenses in connection therewith) relating to, resulting
from or arising out of, (i) fraud, theft, embezzlement or acts of gross
negligence or willful misconduct by officers, employees or agents of Services
during the term of this Agreement, (ii) failure to perform the transition
services or take the actions required by this Agreement during the term of this
Agreement; (iii) personal injuries or death or material damages to property, in
any way incident to or in connection with or arising out of the presence of any
of Services’ employees, contractors or agents on USL’s premises, provided,
however, that the foregoing shall not be interpreted to require Services to
indemnify USL against the negligence or willful misconduct of USL, its
subsidiaries, employees, contractors, agents resulting in personal injuries or
death or material damages to property.


     4.6    Relationship Manager. During the term of this Agreement, each party
will have a relationship manager that may change from time to time who will be
responsible for the relationship with the other party under this Agreement. To
the fullest extent practicable, all communications between the parties with
regard to this Agreement will be between the relationship managers or arranged
by them. The initial relationship manager for Services is Cary Grossman. The
initial relationship manager for USL is Gary Van Rooyan.


     4.7    Relationship Between Parties. The relationship between the parties
under this Agreement will be solely that of independent parties. Nothing in
this Agreement will cause the parties to be partners or joint venturers or to
have any similar relationship.


     4.8    Notices. All notices and other communications under or relating to
this Agreement must be made in the manner provided in Paragraph 14.9 of the
Merger and Partnership Purchase Agreement dated July 21, 2003 among USL,
certain subsidiaries of USL, Services and certain subsidiaries of Services.


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     4.9    Entire Agreement. This Agreement contains the entire agreement
between the parties relating to the matters which are the subject of this
Agreement, except to the extent those matters also are the subject of the
Merger and Partnership Purchase Agreement or documents which have been
delivered or are required to be delivered in accordance with the Merger and
Partnership Purchase Agreement. Except as provided in the Merger and
Partnership Purchase Agreement or documents delivered or required to be
delivered in accordance with it, there are no representations, warranties,
understandings or agreements concerning the matters which are the subject of
this Agreement other than those expressly set forth in this Agreement.


     4.10    Assignment. Neither this Agreement nor any right of either party
under it may be assigned without the prior written approval of the other party.


     4.11    Benefit of Agreement. This Agreement will be binding upon and will
inure to the benefit of the parties to it, their subsidiaries and their
respective successors. Nothing in this Agreement is intended to confer any
rights or benefits upon any other person.


     4.12    Captions. The captions of the Articles and Sections of this
Agreement are for reference only, and do not effect the meaning or
interpretation of this Agreement.


     4.13    Governing Law. This Agreement will be governed by, and construed
under, the substantive laws of the State of Texas, without giving effect to any
principles of conflicts of laws that might apply the laws of another
jurisdiction.


     4.14    Court Jurisdiction. Each Party agrees that any action or proceeding
relating to this Agreement or the transactions contemplated by it may be
brought in any Federal or state court sitting in the State of Texas in the
United States of America, and each of them (i) consents to the jurisdiction of
each of those courts in any such action or proceeding, (ii) agrees not to seek
to have the venue of any such action or proceeding changed because of
inconvenience of


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 the forum or otherwise (except that nothing in this Paragraph will prevent
a party from removing an action from a state court to a Federal court sitting
in Texas), and (iii) agrees that process in any such action or proceeding may
be served by registered mail or in any other manner permitted by the rules of
the court in which the action or proceeding is brought.


     4.15    Amendments. This Agreement may be amended only by a document in
writing signed by both parties.


     4.16    Counterparts. This Agreement may be executed in two or more
counterparts, some of which may contain the signatures of fewer than all the
parties or may contain facsimile copies of pages signed by some of the parties.
Each of those counterparts will be deemed to be an original, but all of them
together will constitute one and the same agreement.


     4.17    Term. Unless sooner terminated by the mutual agreement of Services
and USL, the term of this Agreement shall commence as of the date of this
Agreement and shall continue in force and effect for one hundred and eighty
(180) days.


     4.18    Independent Contractor. The parties hereto agree that the services
rendered by USL and its subsidiaries in the fulfillment of the terms and
obligations of this Agreement shall be as an independent contractor and not as
an employee. Further, nothing stated in this Agreement shall be construed to
make any party to this Agreement an agent, partner, or joint venturer of or
with the other party.


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     IN WITNESS WHEREOF, the parties have executed this Agreement, intending to
be legally bound by it, on the day shown on the first page of this Agreement.



	 	 	 	 	 
	 	 	ERP ENVIRONMENTAL SERVICES INC.
	 	 	 	 	 
	 	 	
By:	 	 
	 	 	 	 	

	 	 	 	 	Name:
	 	 	 	 	Title:
	 	 	 	 	 
	 	 	U S LIQUIDS, INC.
	 	 	 	 	 
	 	 	
By:	 	 
	 	 	 	 	

	 	 	 	 	Name:
	 	 	 	 	Title:



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