Document:

Exhibit 4.1

 

EXECUTION VERSION

 

ASSIGNMENT, ASSUMPTION AND AMENDMENT TO THE WARRANT
 AGREEMENT

 

Dated as of November 1, 2019

 

THIS ASSIGNMENT, ASSUMPTION AND AMENDMENT TO THE WARRANT AGREEMENT (this “Agreement”), dated as of November 1, 2019, is by and between US Ecology Parent, Inc., a Delaware corporation (the “Company”), and American Stock Transfer & Trust Company, LLC, as warrant agent (the “Warrant Agent,” also referred to herein as the “Transfer Agent”).

 

WHEREAS, NRC Group Holdings Corp.(“NRCG”) previously completed an initial public offering of units of NRCG’s equity securities, each such unit comprised of one share of common stock of NRCG, par value $0.0001 per share (“NRCG Common Stock”) and three-quarters of one warrant to purchase common stock of NRCG;

 

WHEREAS, on October 17, 2018 NRCG’s units separated into their component shares of NRCG Common Stock and warrants to purchase one share of NRCG Common Stock (the “NRCG Warrants”),

 

WHEREAS, the NRCG Warrants were governed by that Warrant Agreement (the “Predecessor Warrant Agreement”) by and between Hennessy Capital Acquisition Corp. III (now known as NRC Group Holdings Corp.) and Continental Stock Transfer & Trust Company, a New York corporation (“Continental”);

 

WHEREAS, each whole NRCG Warrant entitles the holder thereof to purchase one share of NRCG Common Stock for $11.50 per share, subject to adjustment as described in the Predecessor Warrant Agreement;

 

WHEREAS, the Company has entered into that certain Agreement and Plan of Merger, by and among the Company, US Ecology, Inc., Rooster Merger Sub, Inc. (“Rooster Merger Sub”), ECOL Merger Sub, Inc. and NRCG, dated as of June 23, 2019 (the “Merger Agreement,”), which, among other things, provides for the merger of Rooster Merger Sub with and into NRCG with NRCG surviving such merger as a wholly-owned subsidiary of the Company (the “Merger” and such other transactions contemplated in the Merger Agreement, the “Mergers”).  As a result of the Mergers, the holders of NRCG Common Stock shall become holders of the Company’s common stock, par value $0.01 per share (the “Common Stock”), with each share of NRCG Common Stock exchange for a fraction of a Common Stock at the Exchange Ratio (as defined in the Merger Agreement);

 

WHEREAS, pursuant to the Merger Agreement and Section 4.4 of the Predecessor Warrant Agreement, the Company is entering into this Agreement and will issue replacement warrants in respect of the NRCG Warrants simultaneously with the closing of the Mergers (the “Warrants”);

 

WHEREAS, in connection with the Mergers, NRCG desires to assign all of its rights, title and interest in the Predecessor Warrant Agreement to Company and Company wishes to accept such assignment;

 

 

WHEREAS, in connection with the Mergers, Continental desires to assign all of its rights, title and interests in the Predecessor Warrant Agreement to the Warrant Agent and the Warrant Agent wishes to accept such assignment;

 

WHEREAS, the Company has filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-4, File No. 333-232930, which was declared effective by the Commission on September 19, 2019 (the “Registration Statement”) and prospectus for the registration, under the Securities Act of 1933, as amended (the “Securities Act”), of certain shares of Common Stock, the Warrants and the Common Stock underlying the Warrants;

 

WHEREAS, Section 9.8 of the Predecessor Warrant Agreement provides that the Predecessor Warrant Agreement may be amended by the parties thereto without the consent of any Registered Holder (i) for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained therein or adding or changing any other provisions with respect to matters or questions arising under the Predecessor Warrant Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the Registered Holders, and (ii) to provide for the delivery of Alternative Issuance (as defined in the Predecessor Warrant Agreement) pursuant to Section 4.4 of the Predecessor Warrant Agreement;

 

WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, transfer, exchange, redemption and exercise of the Warrants;

 

WHEREAS, the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and

 

WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding and legal obligations of the Company, and to authorize the execution and delivery of this Agreement.

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:

 

1.             Assignment and Assumption; Consent.

 

1.1.         Assignment and Assumption. NRCG hereby assigns to the Company all of NRCG’s right, title and interest in and to the Predecessor Warrant Agreement as of the Effective Time (as defined in the Merger Agreement). The Company hereby assumes, and agrees to pay, perform, satisfy and discharge in full, as the same become due, all of NRCG’s liabilities and obligations under the Predecessor Warrant Agreement arising from and after the Effective Time. Furthermore, Continental hereby assigns to the Warrant Agent all of Continental’s right, title and interest in and to the Predecessor Warrant Agreement as of the Effective Time (as defined in the Merger Agreement). The Warrant Agent hereby assumes, and agrees to pay, perform, satisfy and discharge in full, as the same become due, all of Continental’s liabilities and obligations under the Predecessor Warrant Agreement arising from and after the Effective Time.

 

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1.2.         Consent. Continental hereby consents to the assignment of the Predecessor Warrant Agreement by NRCG to the Company pursuant to Section 1.1 hereof effective as of the Effective Time, and the assumption of the Predecessor Warrant Agreement by the Company from NRCG pursuant to Section 1.1 hereof effective as of the Effective Time.

 

2.             Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance with the terms and conditions set forth in this Agreement.

 

3.             Warrants.

 

3.1.         Effect of Countersignature. If a physical certificate is issued, unless and until countersigned by the Warrant Agent pursuant to this Agreement, a Warrant shall be invalid and of no effect and may not be exercised by the holder thereof.

 

3.2.         Registration.

 

3.2.1.      Warrant Register. The Warrant Agent shall maintain books (the “Warrant Register”), for the registration of original issuance and the registration of transfer of the Warrants. Upon the initial issuance of the Warrants in book-entry form, the Warrant Agent shall issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance with instructions delivered to the Warrant Agent by the Company. Ownership of beneficial interests in the Warrants shall be shown on, and the transfer of such ownership shall be effected through, records maintained by institutions that have accounts with the Depository Trust Company (the “Depository”) (such institution, with respect to a Warrant in its account, a “Participant”).

 

If the Depository subsequently ceases to make its book-entry settlement system available for the Warrants, the Company may instruct the Warrant Agent regarding making other arrangements for book-entry settlement. In the event that the Warrants are not eligible for, or it is no longer necessary to have the Warrants available in, book-entry form, the Warrant Agent shall provide written instructions to the Depository to deliver to the Warrant Agent for cancellation each book-entry Warrant, and the Company shall instruct the Warrant Agent to deliver to the Depository definitive certificates in physical form evidencing such Warrants which shall be in the form annexed hereto as Exhibit A.

 

The certificates, if issued, shall be signed by, or bear the facsimile signature of, the Chairman of the Board, President, Chief Executive Officer, Chief Financial Officer, Secretary or other principal officer of the Company. In the event the person whose facsimile signature has been placed upon any Warrant shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant is issued, it may be issued with the same effect as if he or she had not ceased to be such at the date of issuance.

 

3.2.2.      Registered Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the person in whose name such Warrant is registered in the Warrant Register (the “Registered Holder”) as the absolute owner of such Warrant and of each Warrant represented thereby, for the purpose of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.

 

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3.3.         No Fractional Warrants. The Company shall not issue fractional Warrants. If a holder of NRCG Warrants would be entitled to receive a fractional Warrant, the Company shall round down to the nearest whole number the number of Warrants to be issued to such holder.

 

4.             Terms and Exercise of Warrants.

 

4.1.         Warrant Price. Each whole Warrant shall, when countersigned by the Warrant Agent, entitle the Registered Holder thereof, subject to the provisions of such Warrant and of this Agreement, to purchase from the Company the number of shares of Common Stock stated therein, at the price of $58.67 per share, subject to the adjustments provided in Section 5 hereof and in the last sentence of this Section 4.1. The term “Warrant Price” as used in this Agreement shall mean the price per share at which shares of Common Stock may be purchased at the time a Warrant is exercised. The Company in its sole discretion may lower the Warrant Price at any time prior to the Expiration Date (as defined below) for a period of not less than twenty (20) Business Days, provided, that the Company shall provide at least twenty (20) days prior written notice of such reduction to Registered Holders of the Warrants and, provided further that any such reduction shall be identical among all of the Warrants.

 

4.2.         Duration of Warrants. A Warrant may be exercised only during the period (the “Exercise Period”) commencing on the date of this Agreement, and terminating at 5:00 p.m., New York City time on the earlier to occur of: (x) October 17, 2023, or (y) the Redemption Date (as defined below) as provided in Section 7.2 hereof (the “Expiration Date”); provided, however, that the exercise of any Warrant shall be subject to the satisfaction of any applicable conditions, as set forth in subsection 4.3.2 below, with respect to an effective registration statement. Except with respect to the right to receive the Redemption Price (as defined below) in the event of a redemption (as set forth in Section 7 hereof), each Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this Agreement shall cease at 5:00 p.m. New York City time on the Expiration Date. The Company in its sole discretion may extend the duration of the Warrants by delaying the Expiration Date; provided, that the Company shall provide at least twenty (20) days prior written notice of any such extension to Registered Holders of the Warrants and, provided further that any such extension shall be identical in duration among all the Warrants.

 

4.3.         Exercise of Warrants.

 

4.3.1.      Payment. Subject to the provisions of the Warrant and this Agreement, a Warrant, when countersigned by the Warrant Agent, may be exercised by the Registered Holder thereof by surrendering it, at the office of the Warrant Agent, or at the office of its successor as Warrant Agent, in Brooklyn, New York, with the subscription form, as set forth in the Warrant, duly executed, and by paying in full the Warrant Price for each full share of Common Stock as to which the Warrant is exercised and any and all applicable taxes due in connection with the exercise of the Warrant, the exchange of the Warrant for the shares of Common Stock and the issuance of such Common Stock, as follows:

 

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(a)           in lawful money of the United States, in good certified check or good bank draft payable to the order of the Warrant Agent;

 

(b)           in the event of a redemption pursuant to Section 7 hereof in which the Company’s board of directors (the “Board”) has elected to require all holders of the Warrants to exercise such Warrants on a “cashless basis,” by surrendering the Warrants for that number of shares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the difference between the Warrant Price and the “Fair Market Value,” as defined in this subsection 4.3.1(b) by (y) the Fair Market Value. Solely for purposes of this subsection 4.3.1(b) and Section 7.3, the “Fair Market Value” shall mean the average last sale price of the Common Stock for the ten (10) trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of the Warrants, pursuant to Section 7 hereof; or

 

(c)           as provided in Section 8.4 hereof.

 

4.3.2.      Issuance of Shares of Common Stock on Exercise. As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment of the Warrant Price (if payment is pursuant to subsection 4.3.1(a)), the Company shall issue to the Registered Holder of such Warrant a book-entry position or certificate, as applicable, for the number of full shares of Common Stock to which he, she or it is entitled, registered in such name or names as may be directed by him, her or it, and if such Warrant shall not have been exercised in full, a new book-entry position or countersigned Warrant, as applicable, for the number of shares of Common Stock as to which such Warrant shall not have been exercised. Notwithstanding the foregoing, the Company shall not be obligated to deliver any shares of Common Stock pursuant to the exercise of a Warrant and shall have no obligation to settle such Warrant exercise unless a registration statement under the Securities Act with respect to the shares of Common Stock underlying the Warrants is then effective and a prospectus relating thereto is current, subject to the Company’s satisfying its obligations under Section 8.4. No Warrant shall be exercisable and the Company shall not be obligated to issue shares of Common Stock upon exercise of a Warrant unless the Common Stock issuable upon such Warrant exercise has been registered, qualified or deemed to be exempt from registration or qualification under the securities laws of the state of residence of the Registered Holder of the Warrants. In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a Warrant, the holder of such Warrant shall not be entitled to exercise such Warrant and such Warrant may have no value and expire worthless. In no event will the Company be required to net cash settle the Warrant exercise. The Company may require holders of Warrants to settle the Warrant on a “cashless basis” pursuant to Section 8.4. If, by reason of any exercise of Warrants on a “cashless basis,” the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share of Common Stock, the Company shall round down to the nearest whole number, the number of shares of Common Stock to be issued to such holder.

 

4.3.3.      Valid Issuance. All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this Agreement shall be validly issued, fully paid and non-assessable.

 

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4.3.4.      Date of Issuance. Each person in whose name any book-entry position or certificate, as applicable, for shares of Common Stock is issued shall for all purposes be deemed to have become the holder of record of such shares of Common Stock on the date on which the Warrant, or book-entry position representing such Warrant, was surrendered and payment of the Warrant Price was made, irrespective of the date of delivery of such certificate in the case of a certificated Warrant, except that, if the date of such surrender and payment is a date when the share transfer books of the Company or book-entry system of the Warrant Agent are closed, such person shall be deemed to have become the holder of such shares of Common Stock at the close of business on the next succeeding date on which the share transfer books or book-entry system are open.

 

4.3.5.      Maximum Percentage. A holder of a Warrant may notify the Company in writing in the event it elects to be subject to the provisions contained in this subsection 4.3.5; however, no holder of a Warrant shall be subject to this subsection 4.3.5 unless he, she or it makes such election. If the election is made by a holder, the Warrant Agent shall not effect the exercise of the holder’s Warrant, and such holder shall not have the right to exercise such Warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the Warrant Agent’s actual knowledge, would beneficially own in excess of 4.9% or 9.8% (as specified by the holder) (the “Maximum Percentage”) of the shares of Common Stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such person and its affiliates shall include the number of shares of Common Stock issuable upon exercise of the Warrant with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock that would be issuable upon (x) exercise of the remaining, unexercised portion of the Warrant beneficially owned by such person and its affiliates and (y) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by such person and its affiliates (including, without limitation, any convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). For purposes of the Warrant, in determining the number of outstanding shares of Common Stock, the holder may rely on the number of outstanding shares of Common Stock as reflected in (1) the Company’s most recent annual report on Form 10-K, quarterly report on Form 10-Q, current report on Form 8-K or other public filing with the Commission as the case may be, (2) a more recent public announcement by the Company or (3) any other notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. For any reason at any time, upon the written request of the holder of the Warrant, the Company shall, within two (2) Business Days, confirm orally and in writing to such holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of equity securities of the Company by the holder and its affiliates since the date as of which such number of outstanding shares of Common Stock was reported. By written notice to the Company, the holder of a Warrant may from time to time increase or decrease the Maximum Percentage applicable to such holder to any other percentage specified in such notice; provided, however, that any such increase shall not be effective until the sixty-first (61st) day after such notice is delivered to the Company.

 

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5.             Adjustments.

 

5.1.         Stock Dividends.

 

5.1.1.      Split-Ups. If after the date hereof, and subject to the provisions of Section 5.6 below, the number of outstanding shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split-up of shares of Common Stock or other similar event, then, on the effective date of such stock dividend, split-up or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in the outstanding shares of Common Stock. A rights offering to holders of the Common Stock entitling holders to purchase shares of Common Stock at a price less than the “Fair Market Value” (as defined below) shall be deemed a stock dividend of a number of shares of Common Stock equal to the product of (i) the number of shares of Common Stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for the Common Stock) multiplied by (ii) one (1) minus the quotient of (x) the price per share of Common Stock paid in such rights offering divided by (y) the Fair Market Value. For purposes of this subsection 5.1.1, (i) if the rights offering is for securities convertible into or exercisable for Common Stock, in determining the price payable for Common Stock, there shall be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “Fair Market Value” means the volume weighted average price of the Common Stock as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the shares of Common Stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.

 

5.1.2.      Extraordinary Dividends. If the Company, at any time while the Warrants are outstanding and unexpired, shall pay a dividend or make a distribution in cash, securities or other assets to the holders of the Common Stock on account of such shares of Common Stock (or other shares of the Company’s capital stock into which the Warrants are convertible), other than (a) as described in subsection 5.1.1 above, or (b) Ordinary Cash Dividends (as defined below) (any such non-excluded event being referred to herein as an “Extraordinary Dividend”), then the Warrant Price shall be decreased, effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash and/or the fair market value (as determined by the Board, in good faith) of any securities or other assets paid on each share of Common Stock in respect of such Extraordinary Dividend.

 

For purposes of this subsection 5.1.2, “Ordinary Cash Dividends” means any cash dividend or cash distribution which, when combined on a per share basis, with the per share amounts of all other cash dividends and cash distributions paid on the Common Stock during the 365-day period ending on the date of declaration of such dividend or distribution (as adjusted to appropriately reflect any of the events referred to in other subsections of this Section 5 and excluding cash dividends or cash distributions that resulted in an adjustment to the Warrant Price or to the number of shares of Common Stock issuable on exercise of each Warrant) does not exceed $2.55.

 

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5.2.         Aggregation of Shares. If after the date hereof, and subject to the provisions of Section 5.6 hereof, the number of outstanding shares of Common Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Common Stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be decreased in proportion to such decrease in outstanding shares of Common Stock.

 

5.3.         Adjustments in Exercise Price. Whenever the number of shares of Common Stock purchasable upon the exercise of the Warrants is adjusted, as provided in subsection 5.1.1 or Section 5.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Common Stock purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of which shall be the number of shares of Common Stock so purchasable immediately thereafter.

 

5.4.         Replacement of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding shares of Common Stock (other than a change under subsections 5.1.1 or 5.1.2 or Section 5.2 hereof or that solely affects the par value of such shares of Common Stock), or in the case of any merger or consolidation of the Company with or into another entity or conversion of the Company into another entity (other than a consolidation or merger in which the Company is the continuing corporation and that does not result in any reclassification or reorganization of the outstanding shares of Common Stock), or in the case of any sale or conveyance to another entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which the Company is dissolved, the holders of the Warrants shall thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the Warrants and in lieu of the shares of Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the Warrants would have received if such holder had exercised his, her or its Warrant(s) immediately prior to such event (the “Alternative Issuance” ) and the Company shall not enter into any such consolidation, merger, sale or conveyance unless the successor or purchasing entity, as the case may be, shall execute an amendment hereto with the Warrant Agent providing for delivery of such Alternative Issuance; provided, however, that (i) if the holders of the Common Stock were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such consolidation or merger, then the kind and amount of securities, cash or other assets constituting the Alternative Issuance for which each Warrant shall become exercisable shall be deemed to be the weighted average of the kind and amount received per share by the holders of the Common Stock in such consolidation or merger that affirmatively make such election, and (ii) if a tender, exchange or redemption offer shall have been made to and accepted by the holders of the Common Stock under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act (or any successor rule)) of which such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act (or any successor rule)) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act (or any successor rule)) more than 50% of the outstanding shares of Common Stock, the holder of a Warrant shall

 

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be entitled to receive as the Alternative Issuance, the highest amount of cash, securities or other property to which such holder would actually have been entitled as a stockholder if such Warrant holder had exercised the Warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the Common Stock held by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustments (from and after the consummation of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in this Section 5; provided, further, that if less than 70% of the consideration receivable by the holders of the Common Stock in the applicable event is payable in the form of common stock in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the Registered Holder properly exercises the Warrant within thirty (30) days following the public disclosure of the consummation of such applicable event by the Company pursuant to a Current Report on Form 8-K filed with the Commission, the Warrant Price shall be reduced by an amount (in dollars) equal to the difference of (i) the Warrant Price in effect prior to such reduction minus (ii) (A) the Per Share Consideration (as defined below) (but in no event less than zero) minus (B) the Black-Scholes Warrant Value (as defined below). The “Black-Scholes Warrant Value” means the value of a Warrant immediately prior to the consummation of the applicable event based on the Black-Scholes Warrant Model for a Capped American Call on Bloomberg Financial Markets (“Bloomberg”). For purposes of calculating such amount, (1) Section 7 of this Agreement shall be taken into account, (2) the price of each share of Common Stock shall be the volume weighted average price of the Common Stock as reported during the ten (10) trading day period ending on the trading day prior to the effective date of the applicable event, (3) the assumed volatility shall be the 90 day volatility obtained from the HVT function on Bloomberg determined as of the trading day immediately prior to the day of the announcement of the applicable event, and (4) the assumed risk-free interest rate shall correspond to the U.S. Treasury rate for a period equal to the remaining term of the Warrant. “Per Share Consideration” means (i) if the consideration paid to holders of the Common Stock consists exclusively of cash, the amount of such cash per share of Common Stock, and (ii) in all other cases, the volume weighted average price of the Common Stock as reported during the ten (10) trading day period ending on the trading day prior to the effective date of the applicable event. If any reclassification or reorganization also results in a change in shares of Common Stock covered by subsection 5.1.1, then such adjustment shall be made pursuant to subsection 5.1.1 or Sections 5.2, 5.3 and this Section 5.4. The provisions of this Section 5.4 shall similarly apply to successive reclassifications, reorganizations, mergers or consolidations, sales or other transfers. In no event will the Warrant Price be reduced to less than the par value per share issuable upon exercise of the Warrant.

 

5.5.         Notices of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares of Common Stock issuable upon exercise of a Warrant, the Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment and the increase or decrease, if any, in the number of shares of Common Stock purchasable at such price upon the exercise of a Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified in Sections 5.1, 5.2, 5.3 or 5.4, the Company shall give written notice of the occurrence of such event to each holder of a Warrant, at the last address set forth for such holder in the Warrant Register, of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.

 

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5.6.         No Fractional Shares. Notwithstanding any provision contained in this Agreement to the contrary, the Company shall not issue fractional shares of Common Stock upon the exercise of Warrants. If, by reason of any adjustment made pursuant to this Section 5, the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise, round down to the nearest whole number the number of shares of Common Stock to be issued to such holder.

 

5.7.         Form of Warrant. The form of Warrant need not be changed because of any adjustment pursuant to this Section 5, and Warrants issued after such adjustment may state the same Warrant Price and the same number of shares of Common Stock as is stated in the Warrants initially issued pursuant to this Agreement; provided, however, that the Company may at any time in its sole discretion make any change in the form of Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.

 

5.8.         Other Events. In case any event shall occur affecting the Company as to which none of the provisions of preceding subsections of this Section 5 are strictly applicable, but which would require an adjustment to the terms of the Warrants in order to (i) avoid an adverse impact on the Warrants and (ii) effectuate the intent and purpose of this Section 5, then, in each such case, the Company shall appoint a firm of independent public accountants, investment banking or other appraisal firm of recognized national standing, which shall give its opinion as to whether or not any adjustment to the rights represented by the Warrants is necessary to effectuate the intent and purpose of this Section 5 and, if they determine that an adjustment is necessary, the terms of such adjustment. The Company shall adjust the terms of the Warrants in a manner that is consistent with any adjustment recommended in such opinion.

 

6.             Transfer and Exchange of Warrants.

 

6.1.         Registration of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register, upon surrender of such Warrant for transfer, in the case of certificate warrants, properly endorsed with signatures properly guaranteed and accompanied by appropriate instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. In the case of certificate warrants, the Warrants so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon request.

 

6.2.         Procedure for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, together with a written request for exchange or transfer, and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the Registered Holder of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, that in the event that a Warrant surrendered for transfer bears a restrictive legend, the Warrant Agent shall not cancel such Warrant and issue new Warrants in exchange thereof until the Warrant Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the new Warrants must also bear a restrictive legend.

 

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6.3.         Fractional Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange which shall result in the issuance of a warrant certificate or book-entry position for a fraction of a warrant.

 

6.4.         Service Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.

 

6.5.         Warrant Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the terms of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 6, and the Company, whenever required by the Warrant Agent, shall supply the Warrant Agent with Warrants duly executed on behalf of the Company for such purpose.

 

7.             Redemption.

 

7.1.         Redemption. Not less than all of the outstanding Warrants may be redeemed, at the option of the Company, at any time while they are exercisable and prior to their expiration, at the office of the Warrant Agent, upon notice to the Registered Holders of the Warrants, as described in Section 7.2 below, at the price of $0.01 per Warrant (the “Redemption Price”), provided that the last sales price of the Common Stock reported has been at least $91.84 per share (subject to adjustment in compliance with Section 5 hereof), on each of twenty (20) trading days within the thirty (30) trading-day period ending on the third Business Day prior to the date on which notice of the redemption is given and provided that there is an effective registration statement covering the shares of Common Stock issuable upon exercise of the Warrants, and a current prospectus relating thereto, available throughout the 30-day Redemption Period (as defined in Section 7.2 below) or the Company has elected to require the exercise of the Warrants on a “cashless basis” pursuant to subsection 4.3.1; provided, however, that if and when the Warrants become redeemable by the Company, the Company may not exercise such redemption right if the issuance of shares of Common Stock upon exercise of the Warrants is not exempt from registration or qualification under applicable state blue sky laws or the Company is unable to effect such registration or qualification.

 

7.2.         Date Fixed for, and Notice of, Redemption. In the event that the Company elects to redeem all of the Warrants, the Company shall fix a date for the redemption (the “Redemption Date”). Notice of redemption shall be mailed by first class mail, postage prepaid, by the Company not less than thirty (30) days prior to the Redemption Date (such 30-day period, the “Redemption Period”) to the Registered Holders of the Warrants to be redeemed at their last addresses as they shall appear on the registration books. Any notice mailed in the manner herein provided shall be conclusively presumed to have been duly given whether or not the Registered Holder received such notice.

 

7.3.         Exercise After Notice of Redemption. The Warrants may be exercised, for cash (or on a “cashless basis” in accordance with subsection 4.3.1(b) of this Agreement) at any time after notice of redemption shall have been given by the Company pursuant to Section 7.2 hereof and prior to the Redemption Date. In the event that the Company determines to require all holders of Warrants to exercise their Warrants on a “cashless basis” pursuant to subsection 4.3.1, the notice of redemption shall contain the information necessary to calculate the number of shares

 

11

 

of Common Stock to be received upon exercise of the Warrants, including the “Fair Market Value” (as such term is defined in subsection 4.3.1(b) hereof) in such case. On and after the Redemption Date, the record holder of the Warrants shall have no further rights except to receive, upon surrender of the Warrants, the Redemption Price.

 

8.             Other Provisions Relating to Rights of Holders of Warrants.

 

8.1.         No Rights as Stockholder. A Warrant does not entitle the Registered Holder thereof to any of the rights of a stockholder of the Company, including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent or to receive notice as stockholders in respect of the meetings of stockholders or the election of directors of the Company or any other matter.

 

8.2.         Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.

 

8.3.         Reservation of Common Stock. The Company shall at all times reserve and keep available a number of its authorized but unissued shares of Common Stock that shall be sufficient to permit the exercise in full of all outstanding Warrants issued pursuant to this Agreement.

 

8.4.         Registration of Common Stock; Cashless Exercise at Company’s Option.

 

8.4.1.      Registration of the Common Stock. The Company has filed the Registration Statement, which was declared effective by the Commission September 19, 2019, and shall use its best efforts to maintain the effectiveness of such Registration Statement, and a current prospectus relating thereto, until the expiration of the Warrants in accordance with the provisions of this Agreement. Holders of the Warrants shall have the right, during any other period when the Company shall fail to have maintained an effective registration statement covering the shares of Common Stock issuable upon exercise of the Warrants, to exercise such Warrants on a “cashless basis,” by exchanging the Warrants (in accordance with Section 3(a)(9) of the Securities Act (or any successor rule) or another exemption) for that number of shares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the difference between the Warrant Price and the “Fair Market Value” (as defined below) by (y) the Fair Market Value. Solely for purposes of this subsection 8.4.1, “Fair Market Value” shall mean the volume weighted average price of the Common Stock as reported during the ten (10) trading day period ending on the trading day prior to the date that notice of exercise is received by the Warrant Agent from the holder of such Warrants or its securities broker or intermediary. The date that notice of cashless exercise is received by the Warrant Agent shall be conclusively determined by the Warrant Agent. In connection with the “cashless exercise” of a Warrant, the Company shall, upon request, provide the Warrant Agent with an opinion of counsel for the Company (which shall be an outside law

 

12

 

firm with securities law experience) stating that (i) the exercise of the Warrants on a cashless basis in accordance with this subsection 8.4.1 is not required to be registered under the Securities Act and (ii) the shares of Common Stock issued upon such exercise shall be freely tradable under United States federal securities laws by anyone who is not an affiliate (as such term is defined in Rule 144 under the Securities Act (or any successor rule)) of the Company and, accordingly, shall not be required to bear a restrictive legend. Except as provided in subsection 8.4.2, for the avoidance of any doubt, unless and until all of the Warrants have been exercised, the Company shall continue to be obligated to comply with its registration obligations under the first three sentences of this subsection 8.4.1.

 

8.4.2.      Cashless Exercise at Company’s Option. If the Common Stock is at the time of any exercise of a Warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act (or any successor rule), the Company may, at its option, (i) require holders of Warrants who exercise Warrants to exercise such Warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act (or any successor rule) as described in subsection 8.4.1 and (ii) in the event the Company so elects, the Company shall not be required to file or maintain in effect a registration statement for the registration, under the Securities Act, of the Common Stock issuable upon exercise of the Warrants, notwithstanding anything in this Agreement to the contrary. If the Company does not elect at the time of exercise to require a holder of Warrants who exercises Warrants to exercise such Warrants on a “cashless basis,” it agrees to use its best efforts to register or qualify for sale the Common Stock issuable upon exercise of the Warrant under the blue sky laws of the state of residence in those states in which the Warrants were initially offered by the Company of the exercising Warrant holder to the extent an exemption is not available.  All calculations related to the cashless exercises under this subsection 8.4.2 and any other section of this Agreement will be provided timely to the Warrant Agent by the Company with instructions for the debit of the exercised Warrant and the issuance of whole shares of Common Stock based on the formula provided in subsection 4.3.1(b) of this Agreement.

 

9.             Concerning the Warrant Agent and Other Matters.

 

9.1.         Payment of Taxes. The Company shall from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of the Warrants, but the Company shall not be obligated to pay any transfer taxes in respect of the Warrants or such shares of Common Stock.

 

9.2.         Resignation, Consolidation, or Merger of Warrant Agent.

 

9.2.1.      Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of thirty (30) days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of a Warrant (who shall, with such notice, submit his or her Warrant for inspection by the Company),

 

13

 

then the holder of any Warrant may apply to the Supreme Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent at the Company’s cost. Any successor Warrant Agent, whether appointed by the Company or by such court, shall be a corporation organized and existing under the laws of the State of New York, in good standing and having its principal office in the Brooklyn, New York and authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority. After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed; but if for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.

 

9.2.2.      Notice of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the Transfer Agent for the Common Stock not later than the effective date of any such appointment.

 

9.2.3.      Merger or Consolidation of Warrant Agent. Any corporation into which the Warrant Agent may be merged or with which it may be consolidated or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant Agent under this Agreement without any further act.

 

9.3.         Fees and Expenses of Warrant Agent.

 

9.3.1.      Remuneration. The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder and shall, pursuant to its obligations under this Agreement, reimburse the Warrant Agent upon demand for all expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.

 

9.3.2.      Further Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed, acknowledged, and delivered all such further and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the carrying out or performing of the provisions of this Agreement.

 

9.4.         Liability of Warrant Agent.

 

9.4.1.      Reliance on Company Statement. Whenever in the performance of its duties under this Agreement, the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a statement signed by the President, Chief Executive Officer or Chairman of the Board of the Company and delivered to the Warrant Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions of this Agreement.

 

14

 

9.4.2.      Indemnity. The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or bad faith. The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and reasonable counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement, except as a result of the Warrant Agent’s gross negligence, willful misconduct or bad faith.

 

9.4.3.      Exclusions. The Warrant Agent shall have no responsibility with respect to the validity of this Agreement or with respect to the validity or execution of any Warrant (except its countersignature thereof). The Warrant Agent shall not be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Warrant. The Warrant Agent shall not be responsible to make any adjustments required under the provisions of Section 5 hereof or responsible for the manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of Common Stock to be issued pursuant to this Agreement or any Warrant or as to whether any shares of Common Stock shall, when issued, be valid and fully paid and non-assessable.

 

9.5.         Acceptance of Agency. The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the terms and conditions herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account for, and pay to the Company, all monies received by the Warrant Agent for the purchase of shares of Common Stock through the exercise of the Warrants.

 

10.          Miscellaneous Provisions.

 

10.1.       Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their respective successors and assigns.

 

10.2.       Notices. Any notice, statement or demand authorized by this Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service within five (5) days after deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:

 

US Ecology Parent, Inc.
 101 S. Capitol Blvd., Suite 1000
 Boise, ID 83702
 Attention: Wayne Ipsen

 

15

 

Any notice, statement or demand authorized by this Agreement to be given or made by the holder of any Warrant or by the Company to or on the Warrant Agent shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service within five (5) days after deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Warrant Agent with the Company), as follows:

 

American Stock Transfer & Trust Company, LLC
 6201 15th Avenue

Brooklyn, NY 11219
 Attention: Relationship Management for US Ecology Parent, Inc.

 

10.3.       Applicable Law. The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in all respects by the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. The Company hereby agrees that any action, proceeding or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.

 

10.4.       Persons Having Rights under this Agreement. Nothing in this Agreement shall be construed to confer upon, or give to, any person or corporation other than the parties hereto and the Registered Holders of the Warrants any right, remedy, or claim under or by reason of this Agreement or of any covenant, condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations, promises, and agreements contained in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors and assigns and of the Registered Holders of the Warrants.

 

10.5.       Examination of the Warrant Agreement. A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in the Brooklyn, New York for inspection by the Registered Holder of any Warrant. The Warrant Agent may require any such holder to submit his or her Warrant for inspection by it.

 

10.6.       Counterparts. This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

 

10.7.       Effect of Headings. The section headings herein are for convenience only and are not part of this Agreement and shall not affect the interpretation thereof.

 

10.8.       Amendments. This Agreement may be amended by the parties hereto without the consent of any Registered Holder (i) for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions with respect to matters or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the Registered Holders, and (ii) to provide for the delivery of Alternative Issuance pursuant to Section 5.4. All other modifications or amendments, including any amendment to increase the Warrant Price or shorten the Exercise Period, shall require the vote or written consent of the

 

16

 

Registered Holders of 65% of the then outstanding Warrants. Notwithstanding the foregoing, the Company may lower the Warrant Price or extend the duration of the Exercise Period pursuant to Sections 4.1 and 4.2, respectively, without the consent of the Registered Holders.

 

10.9.       Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.

 

Exhibit A — Form of Warrant Certificate

 

[Signature Page Follows]

 

17

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

	
 
    	
 
    	
US ECOLOGY PARENT, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By
    	
/s/ Eric Gerratt
    
	
 
    	
 
    	
 
    	
Name:
    	
Eric Gerratt
    
	
 
    	
 
    	
 
    	
Title:
    	
Chief Financial Officer
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
AMERICAN STOCK   TRANSFER & TRUST COMPANY, LLC, as Warrant Agent
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By
    	
/s/ Michael Legregin
    
	
 
    	
 
    	
 
    	
Name:
    	
Michael Legregin
    
	
 
    	
 
    	
 
    	
Title:
    	
SVP, Attorney Advisory   Gruop
    

 

 

	
ACKNOWLEDGED AND AGREED FOR PURPOSES
   OF SECTION 1.1:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
NRC GROUP HOLDINGS CORP.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ Joseph Peterson
    	
 
    	
 
    
	
Name:
    	
Joseph Peterson
    	
 
    	
 
    
	
Title:
    	
Chief Financial Officer
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ACKNOWLEDGED AND AGREED FOR PURPOSES
   OF SECTION 1.1 AND 1.2:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
CONTINENTAL STOCK   TRANSFER & TRUST
   COMPANY, as warrant agent under the Predecessor
   Warrant Agreement
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ Henry Farrell
    	
 
    	
 
    
	
Name:
    	
Henry Farrell
    	
 
    	
 
    
	
Title:
    	
Vice President
    	
 
    	
 
    

 

[Signature Page to Assignment, Assumption and Amendment to the Warrant Agreement]

 

 

EXHIBIT A

 

[Form of Warrant Certificate]

[FACE]

 

Number

 

Warrants

THIS WARRANT SHALL BE VOID IF NOT EXERCISED PRIOR TO

THE EXPIRATION OF THE EXERCISE PERIOD PROVIDED FOR

IN THE WARRANT AGREEMENT DESCRIBED BELOW

US ECOLOGY PARENT, INC.

Incorporated Under the Laws of the State of Delaware

 

CUSIP 91734M 111

 

Warrant Certificate

 

This Warrant Certificate certifies that, or registered assigns, is the registered holder of warrant(s) evidenced hereby (the “Warrants” and each, a “Warrant”) to purchase shares of Common Stock, $.01 par value (“Common Stock”), of US Ecology Parent, Inc., a Delaware corporation (the “Company”). Each whole Warrant entitles the holder, upon exercise during the period set forth in the Warrant Agreement referred to below, to receive from the Company that number of fully paid and non-assessable shares of Common Stock as set forth below, at the exercise price (the “Exercise Price”) as determined pursuant to the Warrant Agreement, payable in lawful money (or through “cashless exercise” as provided for in the Warrant Agreement) of the United States of America upon surrender of this Warrant Certificate and payment of the Exercise Price at the office or agency of the Warrant Agent referred to below, subject to the conditions set forth herein and in the Warrant Agreement. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.

 

Each whole Warrant is initially exercisable for one fully paid and non-assessable share of Common Stock. No fractional shares will be issued upon exercise of any Warrant. If, upon the exercise of Warrants, a holder would be entitled to receive a fractional interest in a share of Common Stock, the Company will, upon exercise, round down to the nearest whole number the number of shares of Common Stock to be issued to the Warrant holder. The number of shares of Common Stock issuable upon exercise of the Warrants is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.

 

The initial Exercise Price per share of Common Stock for any Warrant is equal to $58.67 per share. The Exercise Price is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.

 

Subject to the conditions set forth in the Warrant Agreement, the Warrants may be exercised only during the Exercise Period and to the extent not exercised by the end of such Exercise Period, such Warrants shall become void.

 

A-1

 

Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof and such further provisions shall for all purposes have the same effect as though fully set forth at this place.

 

This Warrant Certificate shall not be valid unless countersigned by the Warrant Agent, as such term is used in the Warrant Agreement.

 

This Warrant Certificate shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to conflicts of laws principles thereof.

 

	
 
    	
US ECOLOGY PARENT, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

A-2

 

[Form of Warrant Certificate]
 [Reverse]

 

The Warrants evidenced by this Warrant Certificate are part of a duly authorized issue of Warrants entitling the holder on exercise to receive shares of Common Stock and are issued or to be issued pursuant to the Warrant Agreement, dated as of June 22, 2017 (the “Predecessor Warrant Agreement”), between Continental Stock Transfer & Trust Company and Hennessy Capital Acquisition Corp. III (now known as NRC Group Holdings Corp.), as further amended by an Assignment, Assumption and Amendment to the Predecessor Warrant Agreement dated as of November 1, 2019 (the “Warrant Agreement”), duly executed and delivered by the Company to American Stock Transfer & Trust Company, LLC, as warrant agent (the “Warrant Agent”), which Warrant Agreement is hereby incorporated by reference in and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company and the holders (the words “holders” or “holder” meaning the Registered Holders or Registered Holder) of the Warrants. A copy of the Warrant Agreement may be obtained by the holder hereof upon written request to the Company. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.

 

Warrants may be exercised at any time during the Exercise Period set forth in the Warrant Agreement. The holder of Warrants evidenced by this Warrant Certificate may exercise them by surrendering this Warrant Certificate, with the form of election to purchase set forth hereon properly completed and executed, together with payment of the Exercise Price as specified in the Warrant Agreement (or through “cashless exercise” as provided for in the Warrant Agreement) at the principal corporate trust office of the Warrant Agent. In the event that upon any exercise of Warrants evidenced hereby the number of Warrants exercised shall be less than the total number of Warrants evidenced hereby, there shall be issued to the holder hereof or his, her or its assignee, a new Warrant Certificate evidencing the number of Warrants not exercised.

 

Notwithstanding anything else in this Warrant Certificate or the Warrant Agreement, no Warrant may be exercised unless at the time of exercise (i) a registration statement covering the shares of Common Stock to be issued upon exercise is effective under the Securities Act and (ii) a prospectus thereunder relating to the shares of Common Stock is current, except through “cashless exercise” as provided for in the Warrant Agreement.

 

The Warrant Agreement provides that upon the occurrence of certain events the number of shares of Common Stock issuable upon exercise of the Warrants set forth on the face hereof may, subject to certain conditions, be adjusted. If, upon exercise of a Warrant, the holder thereof would be entitled to receive a fractional interest in a share of Common Stock, the Company shall, upon exercise, round down to the nearest whole number of shares of Common Stock to be issued to the holder of the Warrant.

 

Warrant Certificates, when surrendered at the principal corporate trust office of the Warrant Agent by the Registered Holder thereof in person or by legal representative or attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement, but without payment of any service charge, for another Warrant

 

A-3

 

Certificate or Warrant Certificates of like tenor evidencing in the aggregate a like number of Warrants.

 

Upon due presentation for registration of transfer of this Warrant Certificate at the office of the Warrant Agent a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without charge except for any tax or other governmental charge imposed in connection therewith.

 

The Company and the Warrant Agent may deem and treat the Registered Holder(s) hereof as the absolute owner(s) of this Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, of any distribution to the holder(s) hereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary. Neither the Warrants nor this Warrant Certificate entitles any holder hereof to any rights of a stockholder of the Company.

 

A-4

 

Election to Purchase
  (To Be Executed Upon Exercise of Warrant)

 

The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, to receive shares of Common Stock and herewith tenders payment for such shares of Common Stock to the order of US Ecology Parent, Inc. (the “Company”) in the amount of $       in accordance with the terms hereof. The undersigned requests that a certificate for such shares of Common Stock be registered in the name of, whose address is and that such shares of Common Stock be delivered to whose address is. If said number of shares of Common Stock is less than all of the shares of Common Stock purchasable hereunder, the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares of Common Stock be registered in the name of, whose address is and that such Warrant Certificate be delivered to, whose address is.

 

In the event that the Warrant has been called for redemption by the Company pursuant to Section 7 of the Warrant Agreement and the Company has required cashless exercise pursuant to Section 7.3 of the Warrant Agreement, the number of shares of Common Stock that this Warrant is exercisable for shall be determined in accordance with subsection 4.3.1(b) and Section 7.3 of the Warrant Agreement.

 

In the event that the Warrant is to be exercised on a “cashless” basis pursuant to Section 8.4 of the Warrant Agreement, the number of shares of Common Stock that this Warrant is exercisable for shall be determined in accordance with Section 8.4 of the Warrant Agreement.

 

In the event that the Warrant may be exercised, to the extent allowed by the Warrant Agreement, through cashless exercise (i) the number of shares of Common Stock that this Warrant is exercisable for would be determined in accordance with the relevant section of the Warrant Agreement which allows for such cashless exercise and (ii) the holder hereof shall complete the following: The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, through the cashless exercise provisions of the Warrant Agreement, to receive shares of Common Stock. If said number of shares is less than all of the shares of Common Stock purchasable hereunder (after giving effect to the cashless exercise), the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares of Common Stock be registered in the name of, whose address is, and that such Warrant Certificate be delivered to, whose address is.

 

[Signature Page Follows]

 

A-5

 

	
Date:
    	
      ,   20
    	
 
    	
(Signature)
    
	
 
    	
(Signature)
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
(Address)
    
	
 
    	
(Address)
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(Tax Identification   Number)
    	
 
    	
(Tax Identification   Number)
    
	
 
    	
 
    	
 
    	
 
    
	
Signature   Guaranteed:
    	
 
    	
 
    
	
 
    	
 
    	
 
    

 

THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15 (OR ANY SUCCESSOR RULE)).

 

A-6Exhibit 10.1

 

Execution Version

 

CUSIP Number for Incremental Term B Loans: 90349YAF3

ISIN for Incremental Term B Loans: US90349YAF34

 

LENDER JOINDER AGREEMENT AND SECOND AMENDMENT

 

This LENDER JOINDER AGREEMENT AND SECOND AMENDMENT (this “Agreement”), dated as of November 1, 2019 and effective as of the Effective Date (as defined below), is entered into by and among US Ecology Holdings, Inc. (f/k/a US Ecology, Inc.), a Delaware corporation (the “Borrower”), the Subsidiary Guarantors, Wells Fargo Bank, National Association, as administrative agent (in such capacity, the “Administrative Agent”), the lenders set forth on Schedule A hereto (the “Incremental Term B Lenders”) and Revolving Credit Lenders party hereto.

 

RECITALS

 

WHEREAS, reference is hereby made to that certain Credit Agreement, dated as of April 18, 2017, by and among the Borrower, the lenders party thereto from time to time (the “Lenders”), the Administrative Agent and the other parties party thereto, as amended by that certain First Amendment thereto (the “First Amendment”), dated as of August 6, 2019 (as so amended, and as further amended, restated, replaced, supplemented or otherwise modified from time to time, the “Credit Agreement”).  Capitalized terms defined in the Credit Agreement and not otherwise defined herein being used herein as therein defined.  For the avoidance of doubt, and except as otherwise expressly set forth herein, the terms “Credit Party” and “Credit Parties” as used in this Agreement, shall be as defined in the Credit Agreement, after giving effect to the transactions described in Article III (including Section 3.02).

 

WHEREAS, the Borrower has requested that each Incremental Term B Lender provide an Incremental Term Loan Commitment in the principal amount set forth opposite its name on Schedule A hereto (the “Incremental Term B Loan Commitments” and the Incremental Term Loans made pursuant thereto, “Incremental Term B Loans”).

 

WHEREAS, the Incremental Term B Lenders desire to provide such Incremental Term B Loan Commitments and Incremental Term B Loans.

 

WHEREAS, the Borrower further desires to amend and supplement the Credit Agreement as set forth below in connection with the establishment of the Incremental Term B Loan Commitments and the Incremental Term B Loans, as permitted pursuant to Section 5.13 of the Credit Agreement and Section 12.2 of the Credit Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the premises and agreements, provisions and covenants herein contained, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 

 

ARTICLE I.
 COMMITMENTS AND TERMS

 

Section 1.01          Incremental Term B Loan Commitments.

 

(a)           Incremental Term B Loans.  Each Incremental Term B Lender hereby agrees, severally and not jointly, to make a single loan to the Borrower on the Effective Date in a principal amount equal to its respective Incremental Term B Loan Commitment as set forth on Schedule A hereto, in each case, on the terms and subject to the conditions set forth herein.

 

(b)           Termination of Incremental Term B Loan Commitments.  Notwithstanding any other provision of the Credit Agreement or this Agreement, undrawn Incremental Term B Loan Commitments shall automatically terminate on the Effective Date upon the funding of the corresponding Incremental Term B Loan pursuant to this Section 1.01.  Any amount borrowed under this Section 1.01 and subsequently repaid or prepaid may not be re-borrowed.

 

(c)           Interest and Applicable Margin.

 

(i)            The Incremental Term B Loans shall bear interest as set forth in the Credit Agreement (including Section 5.1 thereof); provided that the LIBOR Rate shall not be available with respect to the Incremental Term B Loans until three (3) Business Days (or four (4) Business Days with respect to a LIBOR Rate based on a twelve month Interest Period) after the Effective Date, unless the Borrower has delivered to the Administrative Agent a letter in form and substance reasonably satisfactory to the Administrative Agent indemnifying the Incremental Term B Lenders in the manner set forth in Section 5.9 of the Credit Agreement).

 

(ii)           The Applicable Margin for the Incremental Term B Loans shall be, as of any date of determination, the applicable percentage per annum set forth below based on the Credit Ratings:

 

	
Pricing
   Level
    	
 
    	
Credit Rating
   (S&P and Moody’s)
    	
 
    	
LIBOR +
    	
 
    	
Base Rate +
    	
 
    
	
I
    	
 
    	
BB (with a stable or better outlook) or better from   S&P and Ba2 (with a stable or better outlook) or better from Moody’s
    	
 
    	
2.25
    	
%
    	
1.25
    	
%
    
	
II
    	
 
    	
For any reason Pricing Level I does not apply
    	
 
    	
2.50
    	
%
    	
1.50
    	
%
    

 

For purposes of the foregoing:

 

(1)   if at any time a Credit Rating shall not be available from one or both of the Rating Agencies, then Level II shall be deemed applicable for the period commencing one (1) Business Day after the date that such Credit Rating ceases to be so

 

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available, and ending on the date which is one (1) Business Day after both Credit Ratings are once again available, after which the Pricing Level shall be determined in accordance with the table above; and

 

(2)   adjustments, if any, to the Pricing Level then in effect shall be effective one (1) Business Day after the day that a change in a Credit Rating requiring such adjustment is first announced by the applicable Rating Agency (it being understood and agreed that each change in Pricing Level shall apply during the period commencing on such effective date and ending on the date immediately preceding the next such effective date).

 

(iii)          “Credit Ratings” means, as of any date of determination, the corporate credit rating of the Borrower or Parent Guarantor (as applicable) from S&P at such time and the corporate family rating of the Borrower or Parent Guarantor (as applicable) from Moody’s at such time.

 

(iv)          “Rating Agency” means each of Moody’s and S&P.

 

The Applicable Margins set forth above shall be increased as, and to the extent, required by Section 5.13 of the Credit Agreement.

 

(d)           Maturity Date.  The Term Loan Maturity Date with respect to the Incremental Term B Loans shall be the first to occur of (i) the seventh anniversary of the Effective Date (or, with respect to any Incremental Term B Lender, such later date as requested by the Borrower pursuant to Section 5.16 of the Credit Agreement and accepted by such Incremental Term B Lender) and (b) the date of acceleration of the Term Loans pursuant to Section 10.2(a) of the Credit Agreement.

 

(e)           Scheduled Payments.  The Borrower shall repay the aggregate outstanding principal amount of the Incremental Term B Loans in consecutive quarterly installments on the last Business Day of each of March, June, September and December commencing on the last Business Day of the first full fiscal quarter after the Effective Date.  Each quarterly installment shall be in an amount equal to 0.25% of the principal amount of the Incremental Term B Loans made hereunder on the Effective Date, except as the amounts of individual quarterly installments may be adjusted pursuant to Section 4.4 of the Credit Agreement.  If not sooner paid, the Incremental Term B Loans shall be paid in full, together with accrued interest thereon, on the Term Loan Maturity Date.

 

(f)            Call Premium.  Notwithstanding anything to the contrary in the Credit Agreement, in the event that, on or prior to the six month anniversary of the Effective Date, the Borrower (i) makes any prepayment of the Incremental Term B Loans in connection with any Repricing Transaction (as defined below) or (ii) effects any amendment of the Credit Agreement resulting in a Repricing Transaction, the Borrower shall pay to the Administrative Agent, for the ratable account of each Incremental Term B Lender, a fee in an amount equal to, (x) in the case of clause (i), a prepayment premium of 1.0% of the amount of the Incremental Term B Loans being prepaid and (y) in the case of clause (ii), a payment equal to 1.0% of the aggregate amount of the

 

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applicable Incremental Term B Loans outstanding immediately prior to such amendment.  Such fees shall be due and payable on the date of the effectiveness of such Repricing Transaction.  “Repricing Transaction” means (i) any prepayment or repayment of the Incremental Term B Loans with the proceeds of, or any conversion of the Incremental Term B Loans into, any new or replacement tranche of term loans or Indebtedness (including, without limitation, Replacement Term Loans) bearing interest with an Effective Yield less than the Effective Yield applicable to the Incremental Term B Loans and (ii) any amendment to the pricing terms of the Incremental Term B Loans which reduces the Effective Yield applicable to the Incremental Term B Loans (it being understood that such premium shall apply to any Non-Consenting Lender that is replaced under Section 5.12(b) of the Credit Agreement in connection with any such amendment), in each case, other than any such prepayment, repayment, conversion or amendment that is undertaken in connection with the consummation of a Permitted Acquisition or other acquisition permitted under the Credit Agreement or the occurrence of a Change in Control or a sale of all or substantially all of the assets of the Borrower (so long as the primary purpose of such prepayment, repayment, conversion or amendment is not to reduce the Effective Yield applicable to the Incremental Term B Loans).

 

(g)           Prepayments with Excess Cash Flow.

 

(i)            After the end of each Fiscal Year (commencing with the first full Fiscal Year ending after the Effective Date), within five (5) Business Days after the earlier to occur of (x) the delivery of the financial statements and related Officer’s Compliance Certificate for such Fiscal Year and (y) the date on which the financial statements and the related Officer’s Compliance Certificate for such Fiscal Year are required to be delivered pursuant to Section 8.1(a) and Section 8.2(a) of the Credit Agreement, the Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in Section 4.4(b)(vi) of the Credit Agreement in an amount equal to (A) the Excess Cash Flow Prepayment Percentage of the Excess Cash Flow, if any, for such Fiscal Year minus (B) the aggregate amount of all optional prepayments of Revolving Credit Loans during such Fiscal Year (solely to the extent accompanied by permanent optional reductions in the Revolving Credit Commitment) and all optional prepayments of any Term Loans during such Fiscal Year, in each case, solely to the extent that such prepayments are not funded with the proceeds of long-term Indebtedness.  This Section 1.01(g) shall be deemed to be a prepayment requirement under Section 4.4(b) of the Credit Agreement, and any prepayments pursuant to this Section 1.01(g) shall be deemed to be mandatory prepayments made pursuant to Section 4.4(b) of the Credit Agreement and subject to the manner of payment set forth in Section 4.4(b)(vi) of the Credit Agreement.  The provisions of Section 4.4(b)(viii) shall apply to the Excess Cash Flow attributable to any Foreign Subsidiary in the same manner as such provisions apply to the Net Cash Proceeds of Foreign Dispositions and the Net Cash Proceeds of Foreign Casualty Events.

 

(ii)           “Excess Cash Flow” means, for the Borrower and its Subsidiaries on a Consolidated basis, in accordance with GAAP for any Fiscal Year, the excess, if any, of: (a) the sum, without duplication, of (i) Consolidated Net Income for such Fiscal Year, (ii) an amount equal to the amount of all non-cash charges to the extent deducted in determining Consolidated Net Income for such Fiscal Year and (iii) decreases in Working Capital for such Fiscal Year, minus (b) the sum, without duplication, of (i) the aggregate amount of cash actually paid by the Borrower and its Subsidiaries during such Fiscal Year on account of Capital

 

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Expenditures and Investments made under Sections 9.3(c), (d), (f), (g), (k) and (p) of the Credit Agreement  (in each case under this clause (i) (x) solely to the extent not deducted in the calculation of Consolidated Net Income and (y) other than to the extent any such Capital Expenditure or Investment is made with the proceeds of Indebtedness, any Equity Issuance, asset sale, casualty proceeds, condemnation proceeds or other proceeds to the extent not included in Consolidated Net Income), (ii) the aggregate amount of all permanent repayments of Indebtedness made by the Borrower and its Subsidiaries during such Fiscal Year, in each case, only to the extent that such repayments by their terms cannot be reborrowed or redrawn and do not occur in connection with a refinancing of all or any portion of such Indebtedness, (iii) an amount equal to the amount of all non-cash credits to the extent included in determining Consolidated Net Income for such Fiscal Year, (iv) the aggregate amount of cash actually paid by the Borrower and its Subsidiaries during such Fiscal Year on account of Restricted Payments made under Sections 9.6(d), (e) (to the extent such Restricted Payment relates to another Restricted Payment expressly referenced in this clause (iv)) (f), (g), (h), (i) or (j) of the Credit Agreement during such Fiscal Year (in each case under this clause (iv) (x) solely to the extent not deducted in the calculation of Consolidated Net Income and (y) other than to the extent any such Restricted Payment is made with the proceeds of Indebtedness, any Equity Issuance, asset sale, casualty proceeds, condemnation proceeds or other proceeds to the extent not included in Consolidated Net Income) and (v) increases to Working Capital for such Fiscal Year.

 

(iii)          “Excess Cash Flow Prepayment Percentage” means, for any Fiscal Year, (x) 50%, if the Consolidated Senior Secured Net Leverage Ratio as of the last day of the applicable Fiscal Year is greater than 2.75 to 1.00, (y) 25%, if the Consolidated Senior Secured Net Leverage Ratio as of the last day of the applicable Fiscal Year is greater than 2.25 to 1.00 and less than or equal to 2.75 to 1.00 and (z) 0%, if the Consolidated Senior Secured Net Leverage Ratio as of the last day of the applicable Fiscal Year is less than or equal to 2.25 to 1.00.  “Consolidated Senior Secured Net Leverage Ratio” means, as of any date of determination, the ratio of (a) Consolidated Net Funded Indebtedness that is secured by Liens on property or assets of the Borrower or its Subsidiaries as of such date (other than any Subordinated Indebtedness) to (b) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date for which financial statements have (or are required to have) been delivered pursuant to Section 8.1(a) or 8.1(b) of the Credit Agreement.

 

(iv)          “Working Capital” means, for the Borrower and its Subsidiaries on a Consolidated basis and calculated in accordance with GAAP, as of any date of determination, the amount equal to (a) current assets (other than cash, Cash Equivalents and deferred income taxes) less (b) current liabilities, excluding, without duplication, (i) the current portion of any long-term Indebtedness (other than the current portion of any long-term closure/post-closure obligations), (ii) outstanding Revolving Credit Loans and Swingline Loans, (iii) the current portion of current taxes and deferred income taxes and (iv) the current portion of accrued Consolidated Interest Expense.

 

(h)           Use of Proceeds.

 

(i)            The proceeds of $400,000,000 of the Incremental Term B Loans will be used for the purposes set forth in the definition of NRC Acquisition Incremental Term Loans in the Credit Agreement, prior to giving effect to the amendments to the Credit

 

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Agreement set forth in Section 4.02 (the portion of the Incremental Term B Loans corresponding to such proceeds, the “NRC Acquisition Financing Incremental Term B Loans”, and the associated Incremental Term B Loan Commitments, the “NRC Acquisition Financing Incremental Term B Loan Commitments”).

 

(ii)            The proceeds of $50,000,000 of the Incremental Term B Loans will be used, on the Effective Date, to prepay Revolving Credit Loans  (the portion of the Incremental Term B Loans corresponding to such proceeds, the “Other Incremental Term B Loans”, and the associated Incremental Term B Loan Commitments, the “Other Incremental Term B Loan Commitments”).

 

(i)            Pricing Protection.  If the Effective Yield in respect of any Incremental Term Loan incurred on or prior to the six month anniversary of the Effective Date exceeds the Effective Yield for the Incremental Term B Loans by more than 0.50%, then the Applicable Margin for the Incremental Term B Loans shall be increased so that the Effective Yield in respect of the Incremental Term B Loans is equal to the Effective Yield for such Incremental Term Loan minus 0.50%; provided further, that if an increase in the Effective Yield results solely from an increase in the interest rate floor for such Incremental Term Loan, such increase in the Applicable Margin for the Incremental Term B Loans shall be effected as an interest rate floor.

 

(j)            Other Terms and Conditions.

 

(i)            Each Incremental Term B Loan made hereunder shall constitute a Loan, a Term Loan, an Incremental Term Loan and a NRC Acquisition Incremental Term Loan under the Credit Agreement and, except as expressly set forth in this Agreement, shall be subject to all of the terms and conditions of the Credit Agreement applicable to Loans, Term Loans, Incremental Term Loans and NRC Acquisition Incremental Term Loans.  Each Incremental Term B Loan Commitment hereunder shall constitute a Commitment, a Term Loan Commitment and an Incremental Term Loan Commitment under the Credit Agreement and, except as expressly set forth in this Agreement, shall be subject to all of the terms and conditions of the Credit Agreement applicable to Commitments, Term Loan Commitments and Incremental Term Loan Commitments.  The Incremental Term B Loans shall constitute Obligations of the Borrower and shall be secured and guaranteed with the other Extensions of Credit under the Credit Agreement on a pari passu basis.

 

(ii)           Upon the Effective Date, each Incremental Term B Lender shall become a Lender, a Term Loan Lender and an Incremental Lender under, and for all purposes of, the Credit Agreement and the other Loan Documents, and shall be subject to and bound by the terms thereof, and shall perform all the obligations of and shall have all rights of a Lender, Term Loan Lender and Incremental Lender thereunder.  This Agreement shall be deemed a “Lender Joinder Agreement” and a “Loan Document” under the Credit Agreement.

 

(iii)          The Incremental Term B Loans and the Incremental Term B Loan Commitments shall constitute a Non-Covenant Facility under the Credit Agreement.

 

(iv)          The Borrower hereby designates that the Incremental Term B Loan Commitments, and the Incremental Term B Loans incurred thereunder, are incurred pursuant to clause (a) of the definition of Incremental Loan Amount in the Credit Agreement (both before and after giving effect to Section 4.02(a)).

 

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(v)           This Agreement shall constitute notice by the Borrower to the Administrative Agent of the establishment of incremental term loan commitments and additional term loans, as contemplated by Section 5.13(a) of the Credit Agreement, and the proposed Increased Amount Date for such incremental term loan commitments and additional term loans shall be the Effective Date hereunder.  The Administrative Agent hereby waives the ten (10) Business Day notice requirement with respect to such proposed Increased Amount Date, in accordance with Section 5.13(a) of the Credit Agreement.

 

Section 1.02          Lender Confirmations.  Each Incremental Term B Lender (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Agreement and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an Eligible Assignee, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of its Commitments and Loans, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to provide its Incremental Term B Loan Commitments and Incremental Term B Loans ,and either it, or the Person exercising discretion in making its decision to provide such Term B Loan Commitments and Incremental Term B Loans, is experienced in providing such Term B Loan Commitments and Incremental Term B Loans, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 6.1 or Section 8.1 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Agreement and to provide its respective Incremental Term B Loan Commitments and the Incremental Term B Loans made pursuant hereto, (vi) it has, independently and without reliance upon the Administrative Agent, or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement and to provide its Incremental Term B Loan Commitments and the Incremental Term B Loans made pursuant hereto and (vii) if it is a Foreign Lender, it has provided to the Administrative Agent any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by such Incremental Term B Lender, (b) agrees that (i) it will, independently and without reliance on the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender and (c) irrevocably appoints Wells Fargo Bank to act on its behalf as the Administrative Agent under the Credit Agreement and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms thereof, together with such actions and powers as are reasonably incidental thereto.

 

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ARTICLE II.
 BORROWER’S CERTIFICATIONS

 

To induce the Administrative Agent and the Incremental Term B Lenders to agree to this Agreement, the Credit Parties party hereto represent to Administrative Agent and the Incremental Term B Lenders that, as of the Effective Date, after giving effect to the transactions described in Article III (including Section 3.02) and the extensions of credit hereunder:

 

Section 2.01          Organization; Power; Qualification.  Each of the Borrower and each other material Credit Party (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation and (b) has the power and authority to own its Properties and to carry on its business as now being and hereafter proposed to be conducted.  Each Credit Party (other than the Borrower and other material Credit Parties) and each Subsidiary of a Credit Party (other than any material Credit Party or Immaterial Subsidiary) (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation, except where the failure to do so could not reasonably be expected to result in a Material Adverse Effect and (b) has the power and authority to own its Properties and to carry on its business as now being and hereafter proposed to be conducted.  Each Credit Party and each Subsidiary thereof is duly qualified and authorized to do business in each jurisdiction in which the character of its Properties or the nature of its business requires such qualification and authorization, except where the failure so to qualify or be so authorized could not reasonably be expected to result in a Material Adverse Effect.

 

Section 2.02          Authorization; Enforceability.  Each Credit Party that is a party hereto has the right, power and authority and has taken all necessary corporate and other action to authorize the execution, delivery and performance of this Agreement in accordance with its terms.  This Agreement has been duly executed and delivered by the duly authorized officers of each Credit Party that is a party hereto, and this Agreement constitutes the legal, valid and binding obligation of each Credit Party that is a party hereto, enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar state or federal Debtor Relief Laws from time to time in effect which affect the enforcement of creditors’ rights in general and the availability of equitable remedies.

 

Section 2.03          Compliance of Agreement with Laws, Etc.  The execution, delivery and performance by each Credit Party that is a party hereto of this Agreement, in accordance with its terms, and the transactions contemplated hereby do not and will not, by the passage of time, the giving of notice or otherwise, (a) violate any Applicable Law relating to any Credit Party or any Subsidiary thereof, (b) conflict with, result in a breach of or constitute a default under the articles of incorporation, bylaws or other organizational documents of any Credit Party or any Subsidiary thereof, (c) conflict with, result in a breach of or constitute a default under any indenture, agreement or other instrument to which such Person is a party or by which any of its properties may be bound, (d) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by such Person other than Permitted Liens or (e) require any consent or authorization of, filing with, permit or license of, or other act in respect of, an arbitrator or Governmental Authority and no consent of any other Person is required in connection with the execution, delivery, performance, validity or enforceability of this Agreement other than (i) filings under the UCC, (ii) filings with the United States Copyright Office and/or the

 

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United States Patent and Trademark Office, (iii) filings or consents required by federal or state securities laws or antitrust laws (in connection with the disposition of the Collateral) and (iv) such as have been made or obtained and are in full force and effect, except in the case of clauses (a), (c), and (e), where such violation, conflict, breach or default or failure to obtain any consent, authorization, filing or effect any other act could not reasonably be expected to result in a Material Adverse Effect.

 

Section 2.04          Absence of Defaults.  No event has occurred or is continuing (a) which constitutes a Default or an Event of Default, or (b) which constitutes, or which with the passage of time or giving of notice or both would constitute, a default or event of default by any Credit Party or any Subsidiary thereof under (i) any Material Contract or (ii) any judgment, decree or order to which any Credit Party or any Subsidiary thereof is a party or by which any Credit Party or any Subsidiary thereof or any of their respective properties may be bound or which would require any Credit Party or any Subsidiary thereof to make any payment thereunder prior to the scheduled maturity date therefor, in the case of this clause (b), where such default could reasonably be expected to result in a Material Adverse Effect.

 

Section 2.05          Loan Document Representations.  Each of the representations and warranties contained in the Loan Documents is true and correct in all material respects, except for any representation and warranty that is qualified by materiality or reference to Material Adverse Effect, which such representation and warranty is true and correct in all respects, on and as of the Effective Date with the same effect as if made on and as of such date (except for any such representation and warranty that by its terms is made only as of an earlier date, which representation and warranty is true and correct in all material respects as of such earlier date, except for any representation and warranty that is qualified by materiality or reference to Material Adverse Effect, which such representation and warranty is true and correct in all respects as of such earlier date).

 

ARTICLE III.
 CONDITIONS TO THE EFFECTIVE DATE

 

This Agreement shall become effective on the first date, if any, on or after the date hereof (the “Effective Date”) on which each of the following conditions is satisfied or waived by the Arrangers (as defined below) (such conditions to be satisfied or waived by the Arrangers by 11:59 p.m. (Eastern Time) on the date that is 5 business days after the “Outside Date” as defined in the Provided Merger Agreement (as defined below) and giving effect to any extension of the “Outside Date” pursuant to Section 7.02(a) of the Provided Merger Agreement in accordance with the Provided Merger Agreement):

 

Section 3.01          Execution of Counterparts.  The Administrative Agent shall have received executed counterparts of this Agreement from (i) each Credit Party as of the date hereof (prior to giving effect to the transactions set forth in this Article III), (ii) the Administrative Agent, (iii) each of the Incremental Term B Lenders and (iv) each Revolving Credit Lender party hereto (which Incremental Term B Lenders and Revolving Credit Lenders party hereto shall, immediately after the NRC Acquisition Financing Incremental Term B Loans are made hereunder, constitute the Required Lenders under the Credit Agreement at such time).

 

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Section 3.02          NRC Joinder.  Subject to the final paragraph of this Article III, (a) NRC and each of its Subsidiaries in each case that would be required to become Subsidiary Guarantors under Section 8.14 of the Credit Agreement as a result of the NRC Acquisition Transactions (without giving effect to the grace periods set forth therein) shall have become, or substantially concurrently with the Effective Date shall become, Subsidiary Guarantors under the Credit Agreement and (b) to the extent required by Section 8.14 of the Credit Agreement (without giving effect to the grace periods set forth therein), such Subsidiary Guarantors shall have granted, or substantially concurrently with the Effective Date shall grant, to the Administrative Agent for the benefit of the Secured Parties a security interest in any Collateral owned by such Subsidiary Guarantor, and shall have otherwise complied with the requirements set forth in Section 8.14 (without giving effect to the grace periods set forth therein); provided that, for the avoidance of doubt (but without limiting Sections 3.03, 3.04 and 3.05 below), this Section 3.02 shall not require the delivery of any opinions, documents or certificates pursuant to Section 8.14(a)(iii), Section 8.14(a)(vi), Section 8.14(b)(ii) or Section 8.14(b)(iv) of the Credit Agreement.

 

Section 3.03          Legal Opinions.  The Administrative Agent, Wells Fargo Securities, LLC (“WFS”) and BofA Securities, Inc. (“BofA Securities” and, together with WFS, in their capacities as joint bookrunners and joint lead arrangers for the Incremental Term B Loans, the “Arrangers”) shall have received customary legal opinions (including, to the extent not included in lead counsel’s opinion, local counsel opinions with respect to each jurisdiction where a Credit Party is incorporated or formed (other than jurisdictions where only immaterial Credit Parties are incorporated or formed)).

 

Section 3.04          Organizational Documents and Certificates.  The Administrative Agent and the Arrangers shall have received customary evidence of authorization of the Parent Guarantor and the Credit Parties, organizational documents of the Parent Guarantor and the Credit Parties, good standing certificates (with respect to the applicable jurisdiction of incorporation or organization of the Parent Guarantor and each Credit Party to the extent applicable), officer’s certificates (as to incumbency, organizational documents, corporate authorization, Specified Representations, NRC Acquisition Specified Merger Agreement Representations and no Company Material Adverse Effect (as defined below)) and a customary solvency certificate on a consolidated basis from the chief financial officer or treasurer (or equivalent officer) of the Borrower in the form attached hereto as Schedule B.

 

Section 3.05          Personal Property Collateral.  Subject to the final paragraph of this Article III:

 

(a)           Filings and Recordings.  The Administrative Agent shall have received all filings and recordations in the applicable Uniform Commercial Code filing offices and in the United States Copyright Office and United States Patent and Trademark Office that are necessary to perfect the security interests of the Administrative Agent, on behalf of the Secured Parties, in the applicable Collateral (after giving effect to the transactions contemplated by this Article III) and the Administrative Agent shall have received evidence reasonably satisfactory to the Administrative Agent that upon such filings and recordations such security interests constitute valid and perfected first priority Liens thereon (subject to Permitted Liens).

 

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(b)           Pledged Collateral.  The Administrative Agent shall have received (A) original stock certificates or other certificates evidencing the certificated Equity Interests pledged pursuant to the Security Documents, together with an undated stock power for each such certificate duly executed in blank by the registered owner thereof and (B) each original promissory note pledged pursuant to the Security Documents together with an undated allonge for each such promissory note duly executed in blank by the holder thereof.

 

(c)           Lien Search.  To the extent reasonably and promptly requested by the Arrangers, the Administrative Agent shall have received the results of a Lien search (including a search as to intellectual property matters), in form and substance reasonably satisfactory thereto, made against the Credit Parties under the Uniform Commercial Code (or applicable judicial docket) as in effect in each jurisdiction in which filings or recordations under the Uniform Commercial Code are reasonably necessary to evidence or perfect security interests in all assets of such Credit Party.

 

(d)           Property and Liability Insurance.  The Administrative Agent shall have received, in each case in form and substance reasonably satisfactory to the Administrative Agent, evidence of property, business interruption and liability insurance covering each Credit Party.

 

(e)           Other Collateral Documentation.  The Administrative Agent shall have received any documents reasonably requested thereby or as required by the terms of the Security Documents to evidence its security interest in the Collateral (including, without limitation, deposit account control agreements and securities account control agreements and, to the extent capable of being obtained using commercially reasonable efforts, any landlord waivers or collateral access agreements, bailee or warehousemen letters with respect to material asset locations, filings evidencing a security interest in any intellectual property included in the Collateral, or filings with any applicable Governmental Authority).

 

Section 3.06          No Company Material Adverse Effect.  Since the date of the NRC Acquisition Agreement through the Effective Date, there shall not have occurred a Company Material Adverse Effect.  “Company Material Adverse Effect” has the meaning assigned to such term in the Provided Merger Agreement.

 

Section 3.07          Merger Agreement.  The Arrangers shall be satisfied with the terms of the Merger Agreement and all exhibits and schedules thereto (it being understood and agreed that the copy of the Merger Agreement delivered via email to the Arrangers from Sean J. Rosenthal of Dechert LLP at approximately 1:04 a.m. (Eastern) on June 24, 2019 (including the exhibits or the schedules thereto, the “Provided Merger Agreement”) is reasonably satisfactory to the Arrangers).  The NRC Acquisition shall be consummated substantially concurrently with the initial funding of the Incremental Term B Loans in accordance with applicable law in all material respects and on the terms described in the NRC Acquisition Agreement without giving effect to any waiver, modification or consent thereunder that is materially adverse to the interests of the Incremental Term B Lenders (as reasonably determined by the Arrangers), unless the Arrangers shall have

 

11

 

consented thereto (such consent not to be unreasonably withheld, delayed or conditioned), it being understood that, without limitation, (a) any change in the third party beneficiary rights applicable to the Arrangers and the Incremental Term B Lenders, the governing law and choice of forum, the limitation on liability of the Incremental Term B Lenders and the Arrangers to NRC, the waiver of jury trial and the financing cooperation covenant shall be deemed to be materially adverse to the interests of the Lenders unless approved by the Arrangers and (b) any change in purchase price shall not be deemed to be materially adverse to the interests of the Lenders if (i) any decrease in purchase price is in an amount less than 10% of the aggregate purchase price and (ii) any increase in purchase price is funded by equity contributions and/or by the cash and/or equity interests of the Parent Guarantor or the Credit Parties.

 

Section 3.08          NRC Acquisition Transactions.  Clauses (a) though (d) of the definition of NRC Acquisition Transactions shall be consummated substantially concurrently with the initial funding of the Incremental Term B Loans, and upon giving effect to clauses (a) through (d) of the definition of NRC Acquisition Transactions on the Effective Date, (a) NRC shall have no outstanding preferred stock, and the Borrower shall own, directly or indirectly, one hundred percent (100%) of all of the outstanding equity interests in NRC and (b) Parent Guarantor, shall own, directly, one hundred percent (100%) of all of the outstanding equity interests in the Borrower.

 

Section 3.09          Indebtedness.  Upon giving effect to the NRC Acquisition Transactions, the Borrower and its Subsidiaries shall not have any outstanding third party Indebtedness, other than (a) the Obligations, (b) ordinary course capital leases, purchase money indebtedness, equipment financings, letters of credit, bank guarantees, performance bonds and surety bonds, and reimbursement and/or indemnity obligations in respect of the foregoing, (c) other Indebtedness permitted to be incurred under the Credit Agreement and (d) other Indebtedness that the Arrangers agree (such agreement not to be unreasonably withheld, conditioned or delayed) may remain outstanding after the Effective Date.

 

Section 3.10          Financial Statements.  The Arrangers shall have received:

 

(a)           with respect to the Borrower and its Subsidiaries, (i) audited consolidated balance sheets and related consolidated statements of income, retained earnings and cash flows for the most recently completed fiscal year ended at least 90 days prior to the Effective Date (provided that, the Arrangers confirm receipt of such financial statements for the fiscal year ended December 31, 2018) and (ii) unaudited consolidated balance sheets and related consolidated statements of income, retained earnings and cash flows for each interim fiscal quarter ended since the last audited financial statements and at least 45 days prior to the Effective Date (excluding the fourth fiscal quarter of each fiscal year) (provided that, the Arrangers confirm receipt of such financial statements for the fiscal quarter ending March 31, 2019);

 

(b)           with respect to NRC and its Subsidiaries, (i) audited consolidated balance sheets and related consolidated statements of operations and comprehensive income (loss), shareholder’s equity (deficit) and cash flows for NRC and its Subsidiaries for the most recently completed fiscal year ended at least 90 days prior to the Effective Date (provided that, the Arrangers confirm receipt of such financial statements for the fiscal year ended December 31, 2018) and (ii) unaudited consolidated balance sheets and related consolidated statements of

 

12

 

operations and comprehensive income (loss) and cash flows for NRC and its subsidiaries for each interim fiscal quarter ended since the last audited financial statements and at least 45 days prior to the Effective Date (excluding the fourth fiscal quarter of each fiscal year) (provided that, the Arrangers confirm receipt of such financial statements for the fiscal quarter ending March 31, 2019); and

 

(c)           a pro forma consolidated balance sheet and related pro forma consolidated statements of income and cash flows of the Borrower for the fiscal year most recently ended for which audited financial statements are provided pursuant to Section 3.10(a) above and for the four-quarter period ending on the last day of the most recent fiscal quarter (excluding the fourth fiscal quarter of each year) ending at least 45 days before the Effective Date, prepared after giving pro forma effect to each element of the NRC Acquisition Transactions as if the NRC Acquisition Transactions had occurred on the last day of such four quarter period (in the case of such balance sheet) or at the beginning of such period (in the case of such other financial statements), which need not be prepared in compliance with Regulation S-X of the Securities Act of 1933, as amended, or include adjustments for purchase accounting (including adjustments of the type contemplated by Financial Account Standards Board Accounting Standards Codification 805 (formerly SFAS 141R) (it being understood that any purchase accounting adjustments may be preliminary in nature and be based only on estimates and allocations determined by the Borrower)).

 

Section 3.11          Patriot Act.  The Administrative Agent shall have received, at least 3 Business Days (as defined in the Provided Merger Agreement) prior to the Effective Date, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including, without limitation, the PATRIOT Act to the extent such request was received by the Borrower at least 10 Business Days (as defined in the Provided Merger Agreement) prior to the Effective Date.

 

Section 3.12          Fees and Expenses.  All fees and expenses required to be paid on the Effective Date to the Arrangers, the Administrative Agent and the Incremental Term B Lenders pursuant to (a) that certain Commitment Letter, dated June 23, 2019, among the Administrative Agent, WFS, BANA, BofA Securities and the Borrower (the “Commitment Letter”), (b) the Fee Letters (as defined therein) and (c) that certain Supplemental Arrangers Fee Letter, dated October 24, 2019 (the “Supplemental Fee Letter”), among the Administrative Agent, WFS, BANA, BofA Securities and the Borrower, including the fees and expenses of counsel for the Arrangers and the Administrative Agent required to be paid under the Commitment Letter, the Fee Letters and the Supplemental Fee Letter, shall have been paid (or shall be paid from or offset against the proceeds of the initial funding under the Incremental Term B Loans).

 

Section 3.13          Specified Representations and NRC Acquisition Specified Merger Agreement Representations.  The Specified Representations shall be true and correct in all material respects (or if qualified by materiality or material adverse effect, in all respects) on and as of the Effective Date; provided that, to the extent that any Specified Representation with respect to NRC or its Subsidiaries is qualified by or subject to a “material adverse effect”, “material adverse change” or similar term or qualification, the definition thereof shall be the definition of “Company Material Adverse Effect” (as defined in the Provided Merger Agreement) for purposes of the making of such Specified Representation on, or as of, the Effective Date (or any date prior thereto).  The NRC Acquisition Specified Merger Agreement Representations shall be true and correct on

 

13

 

and as of the Effective Date to the extent required by the definition thereof in the Credit Agreement.  No Event of Default under Section 10.1(a), (b), (h) or (i) of the Credit Agreement shall have occurred and be continuing or would result upon the extensions of credit on the Effective Date.

 

Section 3.14          Effective Date.  The Effective Date shall not occur prior to October 1, 2019, unless otherwise agreed in writing by the Arrangers.

 

Section 3.15          First Amendment.  The “Amendment Effective Date” under and as defined in the First Amendment shall have occurred (or shall occur substantially concurrently with the Effective Date), and the First Amendment shall be in full force and effect (or shall be in full force and effect substantially concurrently with the Effective Date).

 

Notwithstanding anything in this Agreement to the contrary, (a) Section 3.13 sets forth the only representations relating to NRC, the Borrower and their respective Subsidiaries and their respective businesses the accuracy of which shall be a condition to the Effective Date and (b) to the extent that any security interest in any Collateral (other than security interests that may be perfected by (i) the filing of a financing statement under the Uniform Commercial Code and (ii) the possession of the certificates evidencing equity securities in the Borrower and the Borrower’s Subsidiaries required to be pledged pursuant to this Agreement or any of the other Loan Documents, to the extent that such equity securities exist prior to the Effective Date and are in the Borrower’s actual possession on the Effective Date after the Borrower’s use of commercially reasonable efforts to obtain them) is not perfected on the Effective Date, then the perfection of such security interests shall not constitute a condition precedent to the Effective Date, but instead shall be required to be perfected within 90 days after the Effective Date (or such longer period agreed to by the Administrative Agent in its reasonable discretion).

 

ARTICLE IV.
 ORDER/SEQUENCING OF INCREMENTAL TERM B LOANS AND AMENDMENT TO CREDIT AGREEMENT

 

Section 4.01          NRC Acquisition Financing Incremental Term B Loans.  The parties party hereto hereby agree that the NRC Acquisition Financing Incremental Term B Loans shall be made on the Effective Date prior to the effectiveness of the Other Incremental Term B Loan Commitments and the making of the Other Incremental Term B Loans.

 

Section 4.02          Amendments, Waivers and Consents.  On the Effective Date, immediately after the NRC Acquisition Financing Incremental Term B Loans are made, the parties party hereto (including, without limitation, the Incremental Term B Lenders and each Revolving Credit Lender party hereto, collectively constituting the Required Lenders under the Credit Agreement), hereby amend, and provide the following consents and waivers under, the Credit Agreement (after giving effect to the First Amendment) as follows:

 

(a)           The definition of “NRC Acquisition Incremental Term Loans” in the Credit Agreement is hereby deleted and replaced with the following:

 

““NRC Acquisition Incremental Term Loans” means Incremental Term Loans in an amount not to exceed $450,000,000, borrowed on the NRC Acquisition Closing Date for the purposes of funding the refinancing (in full) of the funded Indebtedness under the NRC

 

14

 

Existing Credit Agreement, the payment of fees and expenses incurred in connection with the NRC Acquisition Transactions and/or the prepayment of Revolving Credit Loans, in each case, on the NRC Acquisition Closing Date.”

 

(b)           The parties party hereto hereby agree that, notwithstanding anything in the Credit Agreement to the contrary, the only conditions in the Credit Agreement to the effectiveness of the Other Incremental Term B Loan Commitments and the making of the Other Incremental Term B Loans shall be the conditions set forth in Article III of this Agreement, and hereby consent to such Other Incremental Term B Loan Commitments and Other Incremental Term B Loans.

 

(c)           The parties party hereto waive application of (x) the notice requirements in Section 2.4(c) of the Credit Agreement and (y) the provisions of Section 2.4(c) of the Credit Agreement requiring prepayments of Revolving Credit Loans to be in specified minimum or incremental amounts, in each case, to the prepayment of Revolving Credit Loans with the proceeds of the Other Incremental Term B Loans on the Effective Date, and acknowledge and agree that such prepayment may be made on the Effective Date.

 

Section 4.03          Other Incremental Term B Loans.  The parties party hereto hereby agree that (a) the Other Incremental Term B Loan Commitments shall become effective and the Other Incremental Term B Loans shall be made on the Effective Date, in each case, immediately after the amendments to the Credit Agreement set forth in Section 4.02, and (b) notwithstanding that the NRC Acquisition Financing Incremental Term B Loans and the Other Incremental Term B Loans shall be made immediately prior to, or immediately after, as the case may be, the amendments to the Credit Agreement set forth in Section 4.02, the NRC Acquisition Financing Incremental Term B Loans and the Other Incremental Term B Loans shall be deemed one tranche and one Series of Incremental Term Loans under the Credit Agreement (i.e., the Incremental Term B Loans) and the NRC Acquisition Financing Incremental Term B Loan Commitments and the Other Incremental Term B Loan Commitments shall be deemed one tranche and one Series of Incremental Term Loan Commitments under the Credit Agreement (i.e., the Incremental Term B Loan Commitments).

 

ARTICLE V.
 PERFECTION CERTIFICATE

 

On the Effective Date, NRC shall execute and deliver to the Administrative Agent a perfection certificate with respect to itself and each of its Subsidiaries that will be a Credit Party after giving effect to Section 3.02 hereof that is substantially similar in form to the Perfection Certificate that was delivered on the Closing Date (or as otherwise agreed between the Administrative Agent and the Borrower), which perfection certificate shall be dated as of the Effective Date and shall be executed by a Responsible Officer of NRC.

 

15

 

ARTICLE VI.
 VALIDITY OF OBLIGATIONS AND LIENS

 

Each of the Credit Parties party hereto (a) acknowledges and agrees that all of such Credit Party’s obligations under the Security Documents and the other Loan Documents (as affected hereby) to which it is a party are reaffirmed and remain in full force and effect on a continuous basis, (b) reaffirms each lien and security interest granted by it to Administrative Agent for the benefit of the Secured Parties to secure the Secured Obligations (as increased hereby) and the guaranties of the Guaranteed Obligations (as defined in the Guaranty Agreement) (as increased hereby) made by it pursuant to the Credit Agreement and (c) acknowledges and agrees that the grants of liens and security interests by and the guaranties of the Credit Parties contained in the Credit Agreement and the Security Documents are, and shall remain, in full force and effect after giving effect to this Agreement and the transactions contemplated hereby and thereby.

 

ARTICLE VII.
 MISCELLANEOUS

 

Section 7.01          Notice.  For purposes of the Credit Agreement, the initial notice address of each Incremental Term B Lender shall be as set forth below its signature below.

 

Section 7.02          Recordation of the Incremental Term B Loans.  Upon execution and delivery hereof, Administrative Agent will record the Incremental Term B Loans made by the Incremental Term B Lenders, respectively, in the Register.

 

Section 7.03          Amendment, Modification and Waiver.  This Agreement may not be amended, modified or, except as expressly set forth herein, waived, except by an instrument or instruments in writing signed and delivered on behalf of Borrower, the Administrative Agent and the requisite Lenders under the Credit Agreement.

 

Section 7.04          Entire Agreement.  This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, the Issuing Lenders, the Swingline Lender and/or the Arrangers, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.

 

Section 7.05          GOVERNING LAW.  THIS AGREEMENT AND ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

Section 7.06          SUBMISSION TO JURISDICTION; WAIVER OF VENUE; SERVICE OF PROCESS; WAIVER OF JURY TRIAL.  EACH PARTY HERETO AGREES THAT SECTION 12.5(b), SECTION 12.5(c), SECTION 12.5(d) AND SECTION 12.6 OF THE CREDIT AGREEMENT SHALL APPLY TO THIS AGREEMENT MUTATIS MUTANDIS.

 

16

 

Section 7.07          Confidentiality.    Each party hereto agrees that Section 12.10 of the Credit Agreement shall apply to this Agreement mutatis mutandis.

 

Section 7.08          No Advisory or Fiduciary Responsibility.  Each party hereto agrees that Section 12.19 of the Credit Agreement shall apply to this Agreement mutatis mutandis.

 

Section 7.09          Severability.  Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remainder of such provision or the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.  In the event that any provision is held to be so prohibited or unenforceable in any jurisdiction, the Administrative Agent, the Incremental Term B Lenders and the Borrower shall negotiate in good faith to amend such provision to preserve the original intent thereof in such jurisdiction.

 

Section 7.10          Counterparts.  This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  Delivery of an executed counterpart of a signature page of this Agreement by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Agreement.

 

Section 7.11          No Novation.  The parties hereto expressly acknowledge that it is not their intention that this Agreement or any of the other Loan Documents executed or delivered pursuant hereto constitute a novation of any of the obligations, covenants or agreements contained in the Credit Agreement or any other Loan Document, but rather constitute an amendment, modification, waiver or supplement thereof pursuant to the terms contained herein.  The Credit Agreement and the Loan Documents, in each case as amended, modified, waived or supplemented hereby, shall be deemed to be continuing agreements among the parties thereto, and all documents, instruments, and agreements delivered, as well as all Liens created, pursuant to or in connection with the Credit Agreement and the other Loan Documents shall remain in full force and effect, each in accordance with its terms (as amended, modified, waived or supplemented by this Agreement), unless such document, instrument, or agreement has otherwise been terminated or has expired in accordance with or pursuant to the terms of this Agreement or such document, instrument, or agreement or as otherwise agreed by the required parties hereto or thereto, it being understood that from after the occurrence of the Effective Date, each reference in the Loan Documents to the “Credit Agreement,” “thereunder,” “thereof” (and each reference in the Credit Agreement to “this Agreement,” “hereunder,” or “hereof”) or words of like import shall mean and be a reference to the Credit Agreement, as amended, modified, waived or supplemented hereby.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

17

 

IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute and deliver this Agreement as of the date first set forth above.

 

 

	
 
    	
US ECOLOGY HOLDINGS, INC.   (f/k/a US
   ECOLOGY, INC.),   a Delaware corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Eric L. Gerratt
    
	
 
    	
Name:
    	
Eric L. Gerratt
    
	
 
    	
Title:
    	
Executive Vice President
    

 

[Signature Page to Lender Joinder Agreement and Second Amendment]

 

 

	
 
    	
SUBSIDIARY GUARANTORS:
    
	
 
    	
 
    
	
 
    	
AMERICAN   ECOLOGY ENVIRONMENTAL SERVICES
   CORPORATION, a   Texas corporation
    
	
 
    	
US   ECOLOGY HOUSTON, INC., a Delaware corporation
    
	
 
    	
US   ECOLOGY IDAHO, INC., a Delaware corporation
    
	
 
    	
US   ECOLOGY ILLINOIS, INC., a California corporation
    
	
 
    	
US   ECOLOGY MICHIGAN, INC., a Michigan corporation
    
	
 
    	
US   ECOLOGY NEVADA, INC., a Delaware corporation
    
	
 
    	
US   ECOLOGY TEXAS, INC., a Delaware corporation
    
	
 
    	
US   ECOLOGY WASHINGTON, INC., a Delaware corporation
    
	
 
    	
ENVIRITE   OF ILLINOIS, INC.,   a Delaware corporation
    
	
 
    	
ENVIRITE   OF OHIO, INC.,   a Delaware corporation
    
	
 
    	
ENVIRITE   OF PENNSYLVANIA, INC., a Delaware corporation
    
	
 
    	
ENVIRITE   TRANSPORTATION LLC,   an Ohio limited liability company
    
	
 
    	
US   ECOLOGY SULLIGENT, INC., a Michigan corporation
    
	
 
    	
EQ AUGUSTA, INC., a Michigan corporation
    
	
 
    	
EQ   DETROIT, INC.,   a Michigan corporation
    
	
 
    	
US   ECOLOGY TAMPA, INC., a Michigan corporation
    
	
 
    	
EQ   HOLDINGS, INC.,   a Delaware corporation
    
	
 
    	
EQ   INDUSTRIAL SERVICES, INC., a Michigan corporation
    
	
 
    	
EQ   METALS RECOVERY LLC,   an Ohio limited liability company
    
	
 
    	
US   ECOLOGY MOBILE RECYCLING, INC., a Michigan corporation
    
	
 
    	
EQ   NORTHEAST, INC.,   a Massachusetts corporation
    
	
 
    	
US   ECOLOGY TULSA, INC., a Michigan corporation
    
	
 
    	
EQ   PARENT COMPANY, INC., a Delaware corporation
    
	
 
    	
US   ECOLOGY ROMULUS, INC., a Michigan corporation
    
	
 
    	
US   ECOLOGY LIVONIA, INC., a Michigan corporation
    
	
 
    	
MICHIGAN   DISPOSAL, INC.,   a Michigan corporation
    
	
 
    	
RTF   ROMULUS, LLC, a   Michigan limited liability company
    
	
 
    	
US   ECOLOGY TAYLOR, INC., a Michigan corporation
    
	
 
    	
WAYNE   DISPOSAL, INC.,   a Michigan corporation
    
	
 
    	
US   ECOLOGY THERMAL SERVICES, INC.,
    
	
 
    	
a   Delaware corporation
    
	
 
    	
US   ECOLOGY VERNON, INC.,
    
	
 
    	
a   Delaware corporation
    
	
 
    	
US   ECOLOGY TRANSPORTATION SOLUTIONS, INC.,
    
	
 
    	
a   Delaware corporation
    
	
 
    	
US   ECOLOGY WINNIE, LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Eric L. Gerratt
    
	
 
    	
Name:
    	
Eric   L. Gerratt
    
	
 
    	
Title:
    	
Vice   President and Treasurer
    

 

[Signature Page to Lender Joinder Agreement and Second Amendment]

 

 

	
WELLS FARGO BANK, NATIONAL ASSOCIATION,
    	
 
    
	
as   Administrative Agent
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Michael Cenarrusa
    	
 
    
	
Name:
    	
Michael   Cenarrusa
    	
 
    
	
Title:
    	
Vice   President
    	
 
    

 

[Signature Page to Lender Joinder Agreement and Second Amendment]

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,
 as an Incremental Term B Lender and a Revolving Credit Lender

 

	
By:
    	
/s/   Michael Cenarrusa
    	
 
    
	
Name:
    	
Michael   Cenarrusa
    	
 
    
	
Title:
    	
Vice   President
    	
 
    

 

Wells Fargo Bank, National Association

MAC U1858-032

877 West Main Street – 3rd Floor

Boise, Idaho

Attention of: Commercial Banking

Facsimile No.: (208) 519-3279

 

With copies to:

Wells Fargo Bank, National Association

MAC D1109-019

1525 West W.T. Harris Blvd.

Charlotte, NC 28262

Attention of: Syndication Agency Services

Telephone No.: (704) 590-2703

Facsimile No.: (704) 590-3481

 

[Signature Page to Lender Joinder Agreement and Second Amendment]

 

 

SCHEDULE A

to Lender Joinder Agreement and Second Amendment

 

Incremental Term B Loan Commitments

 

	
Name of Incremental Term B Lender
    	
 
    	
Amount of Incremental Term B Loan
   Commitment
    	
 
    
	
Wells Fargo Bank, National Association
    	
 
    	
$
    	
450,000,000
    	
 
    
	
TOTAL
    	
 
    	
$
    	
450,000,000
    	
 
    

 

 

SCHEDULE B

to Lender Joinder Agreement and Second Amendment

 

[FORM OF] SOLVENCY CERTIFICATE

 

[ · ]

 

Reference is made to that certain Credit Agreement dated as of April 18, 2017 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among US ECOLOGY HOLDINGS, INC., a Delaware corporation (f/k/a US Ecology, Inc., a Delaware corporation), as Borrower (the “Borrower”), the lenders from time to time party thereto, WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as Administrative Agent for the Lenders, and the other parties party thereto.  Terms defined in the Credit Agreement are used herein as defined therein.

 

The undersigned hereby certifies that he is the duly qualified and acting [Chief Financial Officer] [Treasurer] of the Borrower, and is authorized, in such capacity, to execute and deliver this Solvency Certificate.

 

Solely in my capacity as [Chief Financial Officer] [Treasurer] of the Borrower and not in my individual capacity, I hereby certify, on behalf of the Borrower (and not in any individual capacity), as of the date hereof that:

 

(a)           I am familiar with the financial performance and prospects of the Borrower and its Subsidiaries and have reviewed the historical financial statements, pro forma financial statements and financial projections delivered pursuant to the Credit Agreement and that certain Lender Joinder Agreement and Second Amendment, dated as of November 1, 2019, and hereby certify that after giving effect to the NRC Acquisition Transactions, the Borrower and its Subsidiaries (on a Consolidated basis) are Solvent.

 

[Signature page follows]

 

 

IN WITNESS WHEREOF, the undersigned has executed this Solvency Certificate as of the date first written above.

 

 

	
 
    	
US   ECOLOGY HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:   [Chief Financial Officer] [Treasurer]

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