Document:

Exhibit 4.2

 

EXECUTION COPY

 

REGISTRATION
RIGHTS AGREEMENT

 

dated as of

July 17,
2006

among

 

SAFETY-KLEEN
HOLDCO., INC.

and 

THE HOLDERS OF COMMON STOCK AND EACH OTHER PARTY

LISTED ON SCHEDULE I HERETO

 

 

TABLE
OF CONTENTS

 

	
  ARTICLE 1

  
	
  DEFINITIONS

  
	
   

  
	
  Section 1.01

  	
  Definitions

  	
  1

  
	
  Section 1.02

  	
  Other Definitional and
  Interpretative Provisions

  	
  6

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  
	
  REGISTRATION RIGHTS

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  Demand Registration

  	
  6

  
	
  Section 2.02

  	
  Piggyback Registration

  	
  10

  
	
  Section 2.03

  	
  Filing Registration
  Statements; Lock-Up Agreements

  	
  12

  
	
  Section 2.04

  	
  Registration Procedures

  	
  12

  
	
  Section 2.05

  	
  Indemnification by the
  Company

  	
  16

  
	
  Section 2.06

  	
  Indemnification by Standby
  Purchasers

  	
  17

  
	
  Section 2.07

  	
  Conduct of Indemnification
  Proceedings

  	
  18

  
	
  Section 2.08

  	
  Contribution

  	
  19

  
	
  Section 2.09

  	
  Participation in Public
  Offering

  	
  20

  
	
  Section 2.10

  	
  Other Indemnification

  	
  20

  
	
  Section 2.11

  	
  Cooperation by the Company

  	
  21

  
	
  Section 2.12

  	
  No Transfer of
  Registration Rights

  	
  21

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  
	
  CERTAIN COVENANTS AND AGREEMENTS

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Limitations on Subsequent
  Registration Rights

  	
  21

  
	
  Section 3.02

  	
  Charter or Bylaw
  Provisions

  	
  21

  
	
  Section 3.03

  	
  Conflicting Agreements

  	
  21

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Binding Effect;
  Assignability; No Third-Party Rights

  	
  22

  
	
  Section 4.02

  	
  Notices

  	
  22

  
	
  Section 4.03

  	
  Waiver; Amendment

  	
  23

  
	
  Section 4.04

  	
  Fees and Expenses

  	
  23

  
	
  Section 4.05

  	
  Governing Law

  	
  23

  
	
  Section 4.06

  	
  Jurisdiction

  	
  24

  
	
  Section 4.07

  	
  Specific Enforcement

  	
  24

  
	
  Section 4.08

  	
  Entire Agreement

  	
  24

  
	
  Section 4.09

  	
  Severability

  	
  24

  
	
  Section 4.10

  	
  Rights Agreement
  Acknowledgement

  	
  24

  

 

i

 

REGISTRATION
RIGHTS AGREEMENT

 

AGREEMENT dated as of July 17,
2006 among (i) Safety-Kleen HoldCo., Inc., a Delaware corporation
(the “Company”), and (ii) the holders of
Common Stock and each other entity listed on Schedule I hereto.

 

W I T N E S S
E T H :

 

WHEREAS, on July 17,
2006, the Initial Standby Purchasers and the Company entered into a standby
purchase agreement pursuant to which the Company is to initiate  a rights offering pursuant to which each
stockholder of the Company is to receive 0.3636 rights per share of Common
Stock held, with each whole right entitling the holder thereof to purchase one
share of Common Stock for $11.00 (the “Rights Offering”)
and each of the Initial Standby Purchasers is to acquire shares of Common Stock
in the Rights Offering on the terms and conditions provided in the aforesaid
agreement;

 

WHEREAS, as a condition to
the Initial Standby Purchasers’ commitments pursuant to the Rights Offering,
the Company has agreed to enter into this Agreement, and each Initial Standby
Purchaser and the Company are bound, and are deemed to be bound, by this
Agreement and entitled to the benefit of and the right to enforce this
Agreement.

 

WHEREAS, each Initial Standby
Purchaser is on the date hereof the holder of the number of shares of Common
Stock as is set forth on Schedule I attached hereto.

 

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

 

ARTICLE 1

DEFINITIONS

 

Section 1.01                                Definitions.  (a)  The following terms, as used
herein, have the following meanings:

 

“Affiliate”
shall have the meaning ascribed to that term in Rule 405.

 

1

 

“Board”
means the board of directors of the Company.

 

“Business Day”
means any day except a Saturday, Sunday or other day on which commercial banks
in New York City are authorized by law to close.

 

“Common Stock”
means the common stock, par value $.01 per share, of the Company and any stock
into which such Common Stock may hereafter be converted or changed (including
by way of recapitalization, merger, consolidation, other reorganization or
otherwise).

 

“Company
Securities” means (i) the Common Stock, (ii) securities
convertible into or exchangeable for Common Stock, and (iii) options,
warrants or other rights to acquire Common Stock.

 

“Exchange Act”
means the Securities Exchange Act of 1934, as amended.

 

“First Public
Offering” means the first Public
Offering after the date hereof.

 

“Initial
Standby Purchaser” means the holders of Common Stock and each other
entity listed on Schedule I hereto and any Affiliate of any holder of Common
Stock or any other entity listed on Schedule I hereto.

 

“NASD”
means the National Association of Securities Dealers, Inc.

 

“Person”
means an individual, corporation, limited liability company, partnership,
association, trust or other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.

 

“Piggyback
Registration” means an offering of Registrable Securities as
provided in Section 2.02.

 

“Public
Offering” means an underwritten public offering of securities of the
Company pursuant to an effective registration statement under the Securities
Act.

 

2

 

“Registrable
Securities” means, at any time, any shares of Common Stock owned
beneficially or of record by any Initial Standby Purchaser or any transferee of
an Initial Standby Purchaser (but only with respect to the shares of Common
Stock so transferred) until (i) a registration statement covering such
shares has been declared effective by the SEC and such shares have been
disposed of pursuant to such effective registration statement or (ii) such
shares are sold, assigned or otherwise disposed of, and the Company has
delivered a new certificate or other evidence of ownership for such shares not
bearing the legend required pursuant to the Stockholders Agreement and/or the
Voting Agreement and such shares may be resold without subsequent registration
under the Securities Act.

 

“Registration
Expenses” means any and all expenses incident to the performance of
or compliance with any registration or marketing of securities, including all—

 

(i)                                      registration, listing and filing fees, and all other fees and
expenses payable in connection with the listing of securities on any securities
exchange or automated interdealer quotation system,

 

(ii)                                 fees and expenses of compliance with any securities or “blue
sky” laws (including reasonable fees and disbursements of counsel in connection
with “blue sky” qualifications of the securities registered),

 

(iii)                              expenses in connection with the preparation, printing,
mailing and delivery of any registration statements, prospectuses and other
documents in connection therewith and any amendments or supplements thereto,

 

(iv)                              security engraving and printing expenses,

 

(v)                                 internal expenses of the Company (including all salaries and
expenses of its officers and employees performing legal or accounting duties),

 

(vi)                              reasonable fees and expenses of counsel for the Company and
customary fees and expenses for independent certified public accountants
retained by the Company (including the expenses relating to any comfort letters
or costs associated with the delivery by independent

 

3

 

certified public accountants of any comfort letters requested
pursuant to Section 2.04(h)),

 

(vii)                          reasonable fees and expenses of any special experts retained
by the Company in connection with such registration,

 

(viii)                       fees and expenses in connection with any review by the NASD
of the underwriting arrangements or other terms of the offering, and all fees
and expenses of any “qualified independent underwriter,” including the fees and
expenses of any counsel thereto,

 

(ix)                              fees and disbursements of underwriters customarily paid by
issuers or sellers of securities, but excluding any underwriting fees,
discounts and commissions attributable to the sale of Registrable Securities,

 

(x)                                  costs of printing and producing any agreements among
underwriters, underwriting agreements, any “blue sky” or legal investment
memoranda and any selling agreements and other documents in connection with the
offering, sale or delivery of the Registrable Securities,

 

(xi)                               transfer agents’ and registrars’ fees and expenses and the
fees and expenses of any other agent or trustee appointed in connection with
such offering,

 

(xii)                           fees and expenses payable in connection with any ratings of
the Registrable Securities, including expenses relating to any presentations to
rating agencies,

 

(xiii)                        all out-of-pocket costs and expenses incurred by the Company
or its appropriate officers in connection with their compliance with Section 2.04(l) and

 

(xiv)                       the reasonable fees and expenses of one counsel for all
Standby Purchasers incurred by any Standby Purchaser in connection with any
registration or transfer of Registrable Securities effected as contemplated by
this Agreement.

 

4

 

Except as provided above,
Registration Expenses shall not include any out-of-pocket expenses of any
Standby Purchaser (or any agents who manage their accounts).

 

“Registration
Request Period” means (w) in the case of a Demand Registration
or a Piggyback Registration for a Public Offering, the period ending ten (10) Business
Day prior to the effective date of the registration statement for such Demand
Registration or Piggyback Registration, (x) in the case of a Shelf
Registration used to effect a Public Offering, the period ending ten (10) Business
Days prior to the first sale of securities in such Public Offering, (y) in
the case of a Demand Registration or a Piggyback Registration other than for a
Public Offering, the period ending two (2) Business Days prior to the
effective date of the registration statement for such Demand Registration or
Piggyback Registration, and (z) in the case of a Shelf Registration that
is not used to effect a Public Offering, the period ending five (5) Business
Days prior to the date on which the registration statement ceases to be
effective, but in no event shall the Registration Request Period be less than
ten (10) Business Days following the date on which notice of a Demand
Registration, Piggyback Registration or Public Offering is first given by the
Company to the Standby Purchasers.

 

“Rule 144”
means Rule 144 (or any successor provisions) under the Securities Act.

 

“Rule 405”
means Rule 405 (or any successor provisions) under the Securities Act.

 

“Rule 415”
means Rule 415 (or any successor provisions) under the Securities Act.

 

“SEC”
means the Securities and Exchange Commission.

 

“Securities
Act” means the Securities Act of 1933, as amended.

 

“Shelf
Registration” means an offering of Registrable Securities made on a
delayed or continuous basis pursuant to Rule 415.

 

“Standby
Purchaser” means any Initial Standby Purchaser, any party to this
Agreement (other than the Company) and any transferee of any party to this

 

5

 

Agreement
(other than the Company) that holds or acquires any Common Stock for so long as
such stock constitutes Registrable Securities.

 

“Stockholders
Agreement” means that certain Stockholders Agreement, dated as of December 24,
2005, among the Company and the stockholders party thereto.

 

“Voting Agreement” means that
certain Voting Agreement dated as of July 17, 2006 by and among the
Company and the holders of Common Stock and the other parties listed on the
signature pages thereto.

 

Section 1.02                                Other
Definitional and Interpretative Provisions.  The words “hereof”, “herein” and “hereunder”
and words of like import used in this Agreement shall refer to this Agreement
as a whole and not to any particular provision of this Agreement.  The captions herein are included for
convenience of reference only and shall be ignored in the construction or
interpretation hereof.  References to
Articles, Sections and Schedules are to Articles, Sections and Schedules of
this Agreement unless otherwise specified. 
All Schedules annexed hereto or referred to herein are hereby
incorporated in and made a part of this Agreement as if set forth in full
herein.  Any capitalized terms used in
any Schedule but not otherwise defined therein, shall have the meaning as defined
in this Agreement.  Any singular term in
this Agreement shall be deemed to include the plural, and any plural term the
singular.  Whenever the words “include”, “includes”
or “including” are used in this Agreement, they shall be deemed to be followed
by the words “without limitation”, whether or not they are in fact followed by
those words or words of like import.  “Writing”,
“written” and comparable terms refer to printing, typing and other means of
reproducing words (including electronic media) in a visible form.  References to any agreement or contract are
to that agreement or contract as amended, modified or supplemented from time to
time in accordance with the terms hereof and thereof.  References to any Person include the
successors and permitted assigns of that Person.  References from or through any date mean,
unless otherwise specified, from and including or through and including,
respectively.

 

ARTICLE 2

REGISTRATION RIGHTS

 

Section 2.01                                Demand
Registration.  (a) 
If at any time following the second anniversary of the date of this Agreement,
the Company shall receive either—

 

6

 

(i)            in the event there has not been the First Public
Offering, a request from at least two (2) Initial Standby Purchasers that
are not Affiliates of each other (but regarding affiliated Initial Standby
Purchasers as a single Initial Standby Purchaser for these purposes) that hold
in the aggregate fifteen percent (15%) or more of the then outstanding Common
Stock, with at least two (2) of such Initial Standby Purchasers holding,
individually, at least five percent (5%) or more of the then outstanding Common
Stock, or

 

(ii)           in the event there has been the First Public Offering,

 

(1)            a
request from one or more Initial Standby Purchasers holding in the aggregate
six percent (6%) or more of the then outstanding Common Stock or

 

(2)            a
request from one or more Standby Purchasers holding in the aggregate ten
percent (10%) or more of the then outstanding Common Stock

 

(any Standby
Purchaser or Purchasers making the request pursuant to clause (i) or (ii),
a “Requesting Stockholder”) that, in each
case, the Company effect the registration under the Securities Act of all or
any portion of such Requesting Stockholders’ Registrable Securities, and
specifying the intended method of disposition thereof (which may include a
Shelf Registration provided that the Company is eligible to use Rule 415
for the purposes thereof), then the Company shall promptly give notice of such
requested registration (each such request shall be referred to herein as a “Demand Registration”) at least five (5) Business Days
prior to the anticipated filing date of the registration statement relating to
such Demand Registration to the other Standby Purchasers and thereupon shall
use its commercially reasonable efforts to effect, as expeditiously as
possible, the registration under the Securities Act of:

 

(i)            all Registrable Securities for which the Requesting
Stockholders have requested registration under this Section 2.01, and

 

(ii)           subject to the restrictions set forth in Sections 2.01(h) and
Section 2.09, all other Registrable Securities that any other Standby
Purchaser (all such other Standby Purchasers, together with the Requesting
Standby Purchasers, the “Registering Stockholders”)
have

 

7

 

requested the Company to register by request
received by the Company within the relevant Registration Request Period,

 

all to the
extent necessary to permit the disposition (in accordance with the intended
methods thereof as aforesaid) of the Registrable Securities so to be
registered, provided that if such registration involves an underwritten Public
Offering, all such Standby Purchasers requesting to be included in the
registration must sell their Registrable Securities to the underwriters
selected as provided in Section 2.04(f) on the same terms and
conditions as apply to the Requesting Stockholders.

 

(b)           Subject
to 2.01(e), the Company shall not be obligated to effect more than five Demand
Registrations, provided that the Company shall not be obligated to effect a
Demand Registration unless the aggregate market price or fair value on the date
of such request of the Registrable Securities requested to be included in such
Demand Registration equals or exceeds $40,000,000.  In no event shall the Company be required to
effect more than one Demand Registration hereunder within any six-month period.

 

(c)           The
Company will from time to time as appropriate notify all Registering
Stockholders of the identities of the other Registering Stockholders and the
number of shares of Registrable Securities requested to be included therein.  At any time prior to the effective date of
the registration statement relating to such registration, the Requesting
Stockholders may revoke such request, without liability to any of the other
Registering Stockholders, by providing a notice to the Company revoking such
request.  A request, so revoked, shall be
considered to be a Demand Registration unless (i) such revocation arose
out of the fault of the Company (in which case the Company shall be obligated
to pay all Registration Expenses in connection with such revoked request), or (ii) the
Requesting Stockholders reimburse the Company for all Registration Expenses of
such revoked request.

 

(d)           The
Company shall be liable for and pay all Registration Expenses in connection
with any Demand Registration, regardless of whether such Registration is
effected, except as set forth in Section 2.01(c).

 

(e)           Unless
otherwise agreed with the Requesting Stockholders, any registration of the
Company’s Common Stock pursuant to this Section 2.01 shall be effected solely
for the purpose of registering the offer and sale of the Common

 

8

 

Stock held by the Registering Stockholders
and shall not be effected for any offer or sale by the Company of securities by
the Company.

 

(f)                                    If requested by one or more Standby
Purchasers holding in the aggregate fifteen (15%) or more of the then
outstanding Common Stock, the Company shall use its reasonable best efforts to
have the Common Stock listed on a national securities exchange (including The
Nasdaq Stock Market LLC) or quoted on the bulletin board of the NASD, so long
as the Company is at the time subject to the reporting requirements under the
Exchange Act, whether or not as a result of a Demand Registration, and
otherwise qualifies for such listing or quotation.

 

(g)                                 A Demand Registration shall not be
deemed to have occurred:

 

(i)            unless
the registration statement relating thereto (A) has become effective under
the Securities Act and (B) has remained effective for a period of at least
180 days, or in the case of a Shelf Registration, two years (or such shorter
period in which all Registrable Securities of the Registering Stockholders
included in such registration have actually been sold thereunder), provided
that such registration statement shall not be considered a Demand Registration
if, after such registration statement becomes effective, (1) such
registration statement is interfered with by any stop order, injunction or
other order or requirement of the SEC or other governmental agency or court and
(2) less than 50% of the Registrable Securities included in such
registration statement have been sold thereunder; or

 

(ii)           if
the Maximum Offering Size is reduced in accordance with Section 2.01(h) such
that less than 50% of the Registrable Securities of the Requesting Stockholders
sought to be included in such registration are included.

 

(h)                                 If a Demand Registration involves an
underwritten Public Offering (including any Shelf Registration used to effect a
Public Offering) and the managing underwriter advises the Company and the
Requesting Stockholders that, in its view, the number of shares of Registrable
Securities requested to be included in such registration (including any
securities that the Company proposes to be included that are not Registrable
Securities) exceeds the largest number of shares that can be sold without
having a material adverse effect on such offering, including the price at which
such shares can be sold (the “Maximum Offering

 

9

 

Size”), the Company shall include in
such registration, in the priority listed below, up to the Maximum Offering
Size:

 

(i)            first,
all Registrable Securities requested to be registered by any Registering
Stockholders (allocated, if necessary for the offering not to exceed the
Maximum Offering Size, pro rata among such entities on the basis of the
relative number of Registrable Securities so requested to be included in such
registration by each), and

 

(ii)           second,
subject to Section 2.01(e), any securities proposed to be registered for
the account of the Company.

 

(i)                                     Upon notice to each Registering
Stockholder, the Company may postpone effecting a registration pursuant to this
Section 2.01 on one occasion during any period of six consecutive months
for a reasonable time specified in the notice but not exceeding thirty (30)
days (which period may not be extended or renewed), if (i) an investment
banking firm of recognized national standing shall advise the Company and the
Requesting Stockholders in writing that effecting the registration would
materially and adversely affect an offering of securities of the Company the
preparation of which had then been commenced or (ii) the Company is in
possession of material non-public information the disclosure of which would be
required by the registration during the period specified in such notice the
Company reasonably believes would not be in the best interests of the Company.

 

Section 2.02           Piggyback Registration.  (a)  If the Company, subject to Section 2.03,
proposes to register any Company Securities under the Securities Act (other
than a registration on Form S-8 or S-4, or any successor forms, relating
to shares of Common Stock issuable upon exercise of employee stock options or
in connection with any employee benefit or similar plan of the Company or in
connection with a direct or indirect acquisition by the Company of another
Person), whether for sale for its own account or for the account of any other
Person or Persons (a “Third Party Requesting Stockholder”),
the Company shall each such time give prompt notice at least five (5) Business
Days prior to the anticipated filing date of the registration statement
relating to such registration to each Standby Purchaser, which notice shall set
forth such Standby Purchaser’s rights under this Section 2.02 and shall
offer such Standby Purchaser the opportunity to include in such registration
statement the number of Registrable Securities of the same class or series as
those proposed to be registered as each such Standby Purchaser may request,
subject to the provisions of Section 2.02(c).

 

10

 

(b)                                 Upon the request of any such Standby
Purchaser made within the relevant Registration Request Period (which request
shall specify the number of Registrable Securities intended to be registered by
each such Standby Purchaser), the Company shall use its reasonable best efforts
to effect the registration under the Securities Act of all Registrable
Securities that the Company has been so requested to register by all such
Standby Purchasers, to the extent requisite to permit the disposition of the
Registrable Securities so to be registered, provided that (i) if such
registration involves an underwritten Public Offering, all such Standby
Purchasers requesting to be included in the registration must sell their
Registrable Securities to the underwriters selected as provided in Section 2.04(f) on
the same terms and conditions as apply to the Company or the Third Party
Requesting Stockholders, as applicable, and (ii) if, at any time after
giving notice of its intention to register any Company Securities pursuant to
this Section 2.02 and prior to the effective date of the registration
statement filed in connection with such registration, the Company shall
determine for any reason not to register such securities, the Company shall
give notice to all such Standby Purchasers and, thereupon, shall be relieved of
its obligation to register any Registrable Securities in connection with such registration.  No registration effected under this Section 2.02
shall relieve the Company of its obligations to effect a Demand Registration to
the extent required by Section 2.01. 
The Company shall pay all Registration Expenses in connection with each
Piggyback Registration.

 

(c)                                  If a Piggyback Registration involves
an underwritten Public Offering (other than any Demand Registration, in which
case the provisions with respect to priority of inclusion in such offering set
forth in Section 2.01(h) shall apply) and the managing underwriter
advises the Company that, in its view, the number of Shares that the Company
and such Standby Purchasers intend to include in such registration exceeds the
Maximum Offering Size, the Company shall include in such registration, in the
following priority, up to the Maximum Offering Size:

 

(i)            first,
so much of the Company Securities proposed to be registered for the account of
the Company or the Third Party Requesting Stockholders, as applicable, as would
not cause the offering to exceed the Maximum Offering Size,

 

(ii)           second,
all Registrable Securities requested to be included in such registration by any
Standby Purchasers pursuant to Section 2.02 (allocated, if necessary for
the offering not to exceed the Maximum Offering Size, pro rata among such
Standby Purchasers on the basis of the

 

11

 

relative number of shares of Registrable
Securities so requested to be included in such registration by each), and

 

(iii)          third,
any securities proposed to be registered for the account of any other Persons
with such priorities among them as the Company shall determine.

 

Section 2.03           Filing Registration Statements;
Lock-Up Agreements.  If any
registration of Registrable Securities shall be effected in connection with a
Public Offering, neither the Company nor any Standby Purchaser who owns at
least 3.5% of the outstanding shares of Common Stock shall effect any public
sale or distribution, including any sale pursuant to Rule 144, of any
Company Securities or other security of the Company (except as part of such
Public Offering) during the period beginning 7 days prior to the effective date
of the applicable registration statement (or in the case of a Shelf
Registration used to effect a Pubic Offering prior to the first sale of
securities in the Public Offering) until the earlier of (i) such time as
the Company and the lead managing underwriter shall agree and (ii) 90 days
(or 120 days if the registration of such Registrable Securities is the First Public
Offering), provided that the Company has obtained the commitments of its
executive officers (which executive officers consist of the Executive Vice
Presidents, President and Chief Executive Officer of the Company) to observe
similar restrictions on public sale or distribution.

 

Section 2.04           Registration Procedures.  Whenever Standby Purchasers request that any
Registrable Securities be registered pursuant to Section 2.01 or 2.02,
subject to the provisions of such Sections, the Company shall use its commercially
reasonable efforts to effect the registration and the sale of such Registrable
Securities in accordance with the intended method of disposition thereof as
quickly as practicable, and, in connection with any such request:

 

(a)           The
Company shall as expeditiously as reasonably possible prepare and file with the
SEC a registration statement on any form for which the Company then qualifies
or that counsel for the Company shall deem appropriate and which form shall be
available for the sale of the Registrable Securities to be registered
thereunder in accordance with the intended method of distribution thereof, and
use its reasonably best efforts to cause such filed registration statement to
become and remain effective continuously for a period of not less than 180
days, or in the case of a shelf registration statement, two years (or such
shorter period in which all of the Registrable Securities of the Registering
Stockholders included in such registration statement shall have actually been
sold thereunder).

 

12

 

(b)           Within
a reasonable time in the circumstances prior to filing a registration statement
or prospectus or any amendment or supplement thereto, the Company shall, if
requested, furnish to each participating Standby Purchaser and each
underwriter, if any, of the Registrable Securities covered by such registration
statement copies of such registration statement as proposed to be filed, and
thereafter the Company shall furnish to such Standby Purchaser and underwriter,
if any, such number of copies of such registration statement, each amendment
and supplement thereto (in each case including all exhibits thereto and
documents incorporated by reference therein), the prospectus included in such
registration statement (including each preliminary prospectus and any summary
prospectus) and any other prospectus filed under Rule 424 or Rule 430A
under the Securities Act and such other documents as such Standby Purchaser or
underwriter may reasonably request in order to facilitate the disposition of
the Registrable Securities owned by such Standby Purchaser.  Each Standby Purchaser shall have the right
to request that the Company modify any information contained in such registration
statement, amendment and supplement thereto pertaining to such Standby
Purchaser and the Company shall use its commercially reasonably efforts to
comply with such request, provided, however, that the Company shall not have
any obligation so to modify any information if the Company reasonably expects
that so doing would cause the prospectus to contain an untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading.

 

(c)           After
the filing of the registration statement, the Company shall (i) cause the
registration statement to be amended by any required amendment (including for
the purpose of adding a Standby Purchaser as a selling securityholder in
accordance with the terms of this Agreement), (ii) cause the related
prospectus to be supplemented by any required prospectus supplement (including
for the purpose of adding a Standby Purchaser as a selling securityholder in
accordance with the terms of this Agreement), and, as so supplemented, to be filed
pursuant to Rule 424 under the Securities Act, (iii) comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such registration statement during the
applicable period in accordance with the intended methods of disposition by the
Registering Stockholders thereof set forth in such registration statement or
supplement to such prospectus and (iv) promptly notify each Registering
Stockholder holding Registrable Securities covered by such registration
statement of any stop order issued or threatened by the SEC or any state
securities commission and take all reasonable actions required to prevent the
entry of such stop order or to remove it if entered.

 

13

 

(d)           The
Company shall use its commercially reasonable efforts to (i) register or
qualify the Registrable Securities covered by such registration statement under
such other securities or “blue sky” laws of such jurisdictions in the United
States as any Registering Stockholder holding such Registrable Securities
reasonably (in light of such Registering Stockholder’s intended plan of
distribution) requests and (ii) cause such Registrable Securities to be
registered with or approved by such other governmental agencies or authorities
as may be necessary by virtue of the business and operations of the Company and
do any and all other acts and things that may be reasonably necessary or
advisable to enable such Registering Stockholder to consummate the disposition
of the Registrable Securities owned by such Registering Stockholder, provided
that the Company shall not be required to (A) qualify generally to do
business in any jurisdiction where it would not otherwise be required to
qualify but for this Section 2.04(d), (B) subject itself to taxation
in any such jurisdiction or (C) consent to general service of process in
any such jurisdiction.

 

(e)           The
Company shall promptly notify each Registering Stockholder holding such
Registrable Securities covered by such registration statement, at any time when
a prospectus relating thereto is required to be delivered under the Securities
Act, of the occurrence of an event requiring the preparation of a supplement or
amendment to such prospectus so that, as thereafter delivered to the purchasers
of such Registrable Securities, such prospectus will not contain an untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading and
promptly prepare and make available to each such Registering Stockholder and
file with the SEC any such supplement or amendment.

 

(f)            (i) 
The Requesting Stockholders shall have the right to select an underwriter or
underwriters in connection with any Public Offering resulting from the exercise
by such Requesting Stockholder of a Demand Registration, which selection shall
be subject to the approval of the Company, which approval shall be reasonably
given, and (ii) the Company shall select an underwriter or underwriters in
connection with any other Public Offering. 
In connection with any Public Offering, the Company shall enter into
customary agreements (including an underwriting agreement in customary form)
and take all such other actions as are reasonably required in order to expedite
or facilitate the disposition of such Registrable Securities in any such Public
Offering, including the engagement of a “qualified independent underwriter” in
connection with the qualification of the underwriting arrangements with the
NASD.

 

14

 

(g)           Upon
execution of confidentiality agreements in form and substance reasonably
satisfactory to the Company, the Company shall make available for inspection by
any Registering Stockholder and any underwriter participating in any
disposition pursuant to a registration statement being filed by the Company
pursuant to this Agreement and any attorney, accountant or other professional
retained by any such Stockholder or underwriter (collectively, the “Inspectors”),
all financial and other records, pertinent corporate documents and properties
of the Company (collectively, the “Records”) as shall be reasonably necessary
or desirable to enable them to exercise their due diligence responsibility, and
cause the Company’s officers, directors and employees to supply all information
reasonably requested by any Inspectors in connection with such registration
statement.  Records that the Company
determines, in good faith, to be confidential and that it notifies the
Inspectors are confidential shall not be disclosed by the Inspectors unless (i) the
disclosure of such Records is necessary to avoid or correct a misstatement or
omission in such registration statement or (ii) the release of such
Records is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction.  Each Registering
Stockholder agrees that information obtained by it as a result of such
inspections shall be deemed confidential and shall not be used by it or its
Affiliates as the basis for any market transactions in the Company Securities
unless and until such information is made generally available to the
public.  Each Registering Stockholder
further agrees that, upon learning that disclosure of such Records is sought in
a court of competent jurisdiction, it shall give notice to the Company and
allow the Company, at its expense, to undertake appropriate action to prevent
disclosure of the Records deemed confidential.

 

(h)           The
Company shall furnish to each Registering Stockholder and to each such
underwriter, if any, a signed counterpart, addressed to such Registering
Stockholder or underwriter, of (i) an opinion or opinions of counsel to
the Company and (ii) a comfort letter or comfort letters from the Company’s
independent public accountants, each in customary form and covering such
matters of the kind customarily covered by opinions or comfort letters, as the
case may be, as a majority of such Registering Stockholders or the managing
underwriter therefor reasonably requests.

 

(i)            If
a Demand Registration involves a Public Offering (including any Shelf
Registration used to effect a Public Offering), the price at which shares shall
be sold in the Public Offering shall be determined in consultation with the
underwriters by a committee consisting of one representative of each
participating Standby Purchaser that is registering for sale an amount of
shares equal to the lesser of (x) 5% of the outstanding Common Stock and (ii) at
least 25% of the total number of shares to be sold in the offering.

 

15

 

(j)                                     The Company shall otherwise use its
commercially reasonable efforts to comply with all applicable rules and
regulations of the SEC, and make available to its security holders, as soon as
reasonably practicable, an earnings statement or such other document covering a
period of 12 months, beginning within three months after the effective date of
the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158
thereunder.

 

(k)                                  The Company may require each
Registering Stockholder promptly to furnish in writing to the Company such
information regarding the distribution of the Registrable Securities as the
Company may from time to time reasonably request and such other information as
may be legally required in connection with such registration.

 

(l)                                     Each Registering Stockholder
agrees that, upon receipt of any notice from the Company of the happening of
any event of the kind described in Section 2.04(e), such Registering
Stockholder shall forthwith discontinue disposition of Registrable Securities
pursuant to the registration statement covering such Registrable Securities
until such Registering Stockholder’s receipt of the copies of the supplemented
or amended prospectus contemplated by Section 2.04(e), and, if so directed
by the Company, such Registering Stockholder shall deliver to the Company all
copies, other than any permanent file copies then in such Registering
Stockholder’s possession, of the most recent prospectus covering such Registrable
Securities at the time of receipt of such notice.  If the Company shall give such notice, the
Company shall extend the period during which such registration statement shall
be maintained effective (including the period referred to in Section 2.04(a))
by the number of days during the period from and including the date of the
giving of notice pursuant to Section 2.04(e) to the date when the
Company shall make available to such Registering Stockholder a prospectus
supplemented or amended to conform with the requirements of Section 2.04(e).

 

(m)                               The Company shall have appropriate
officers of the Company (i) prepare and make presentations at any “road
shows” and before analysts and rating agencies, as the case may be, (ii) take
other actions to obtain ratings for any Registrable Securities and (iii) otherwise
use their commercially reasonable efforts to cooperate as reasonably requested
by the underwriters in the offering, marketing or selling of the Registrable
Securities.

 

Section 2.05                                Indemnification
by the Company.  The Company agrees
to indemnify and hold harmless each Standby Purchaser holding Registrable
Securities covered by a registration statement, its officers, directors,
employees,

 

16

 

partners and agents, and each Person, if any, who controls such Standby
Purchaser within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable expenses of investigation and
reasonable attorneys’ fees and expenses) (“Damages”)
caused by or relating to any untrue statement or alleged untrue statement of a
material fact contained in any registration statement or prospectus relating to
the Registrable Securities (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) or any preliminary
prospectus, or caused by or relating to any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such Damages are
caused by or related to any such untrue statement or omission or alleged untrue
statement or omission so made based upon information furnished in writing to
the Company by such Standby Purchaser or on such Standby Purchaser’s behalf
expressly for use therein, provided that,
with respect to any untrue statement or omission or alleged untrue statement or
omission made in any preliminary prospectus, or in any prospectus, as the case
may be, the indemnity agreement contained in this paragraph shall not apply to
the extent that any Damages result from the fact that a current copy of the
prospectus (or such amended or supplemented prospectus, as the case may be) was
not sent or given to the Person asserting any such Damages at or prior to the
written confirmation of the sale of the Registrable Securities concerned to
such Person if it is determined that the Company has provided such prospectus
to such Standby Purchaser and it was the responsibility of such Standby
Purchaser to provide such Person with a current copy of the prospectus (or such
amended or supplemented prospectus, as the case may be) and such current copy
of the prospectus (or such amended or supplemented prospectus, as the case may
be) would have cured the defect giving rise to such Damages.  The Company also agrees to indemnify any
underwriters of the Registrable Securities, their officers and directors and
each Person who controls such underwriters within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act on substantially
the same basis as that of the indemnification of the Standby Purchasers
provided in this Section 2.05.

 

Section 2.06                                Indemnification
by Standby Purchasers.  Each Standby
Purchaser holding Registrable Securities included in any registration statement
agrees, severally but not jointly, to indemnify and hold harmless the Company,
its officers, directors and agents and each Person, if any, who controls the
Company within the meaning of either Section 15 of the Securities Act or Section 20
of the Exchange Act to the same extent as the foregoing indemnity from the
Company to such Standby Purchaser, but only (i) with respect to
information furnished in writing by such Standby Purchaser or on such Standby
Purchaser’s behalf expressly for use in any registration statement or
prospectus relating to the Registrable Securities, or any amendment or
supplement thereto, or any

 

17

 

preliminary prospectus or (ii) to the extent that any Damages
result from the fact that a current copy of the prospectus (or such amended or
supplemented prospectus, as the case may be) was not sent or given to the
Person asserting any such Damages at or prior to the written confirmation of
the sale of the Registrable Securities concerned to such Person if it is
determined that it was the responsibility of such Standby Purchaser to provide
such Person with a current copy of the prospectus (or such amended or
supplemented prospectus, as the case may be) and such current copy of the
prospectus (or such amended or supplemented prospectus, as the case may be)
would have cured the defect giving rise to such loss, claim, damage, liability or
expense.  Each such Standby Purchaser
also agrees to indemnify and hold harmless underwriters of the Registrable
Securities, their officers and directors and each Person who controls such
underwriters within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act on substantially the same basis as such
Standby Purchaser is required to indemnify the Company as provided in this Section 2.06.  As a condition to including Registrable
Securities in any registration statement filed in accordance with Article 2,
the Company may require that it shall have received an undertaking reasonably
satisfactory to it from any underwriter to indemnify and hold it harmless to
the extent customarily provided by underwriters with respect to similar
securities.

 

Section 2.07                                Conduct
of Indemnification Proceedings.  If
any proceeding (including any governmental investigation) shall be instituted
involving any Person in respect of which indemnity may be sought pursuant to
this Article 2, such Person (an “Indemnified Party”)
shall promptly notify the Person against whom such indemnity may be sought (the
“Indemnifying Party”) in writing and the
Indemnifying Party shall assume the defense thereof, including the employment
of counsel reasonably satisfactory to such Indemnified Party, and shall assume
the payment of all fees and expenses, provided that the failure of any
Indemnified Party so to notify the Indemnifying Party shall not relieve the
Indemnifying Party of its obligations hereunder except to the extent that the
Indemnifying Party is materially prejudiced by such failure to notify.  In any such proceeding, any Indemnified Party
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Party unless (i) the
Indemnifying Party and the Indemnified Party shall have mutually agreed to the
retention of such counsel or (ii) in the reasonable judgment of such
Indemnified Party representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them.  It is understood that, in connection with any
proceeding or related proceedings in the same jurisdiction, the Indemnifying
Party shall not be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Indemnified Parties, and that all such fees and expenses shall be
reimbursed as they are incurred.  In the
case of any such separate firm for the Indemnified Parties, such

 

18

 

firm shall be designated in writing by the Indemnified Parties.  The Indemnifying Party shall not be liable
for any settlement of any proceeding effected without its written consent, but
if settled with such consent, or if there be a final judgment for the
plaintiff, the Indemnifying Party shall indemnify and hold harmless such
Indemnified Parties from and against any loss or liability (to the extent
stated above) by reason of such settlement or judgment.  Without the prior written consent of the
Indemnified Party, no Indemnifying Party shall effect any settlement of any
pending or threatened proceeding in respect of which any Indemnified Party is
or could have been a party and indemnity could have been sought hereunder by
such Indemnified Party, unless such settlement includes an unconditional
release of such Indemnified Party from all liability arising out of such
proceeding and does not include any statement of culpability on the part of the
Indemnified Party.

 

Section 2.08                                Contribution.  If the indemnification provided for in this Article 2
is unavailable to the Indemnified Parties in respect of any Damages, then each
such Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Damages (i) as between the Company and the Standby Purchasers
holding Registrable Securities covered by a registration statement on the one
hand and the underwriters on the other, in such proportion as is appropriate to
reflect the relative benefits received by the Company and such Standby
Purchasers on the one hand and the underwriters on the other, from the offering
of the Registrable Securities, or if such allocation is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits but also the relative fault of the Company and such Standby
Purchasers on the one hand and of such underwriters on the other in connection
with the statements or omissions that resulted in such Damages, as well as any
other relevant equitable considerations and (ii) as between the Company on
the one hand and each such Standby Purchaser on the other, in such proportion
as is appropriate to reflect the relative fault of the Company and of each such
Standby Purchaser in connection with such statements or omissions, as well as
any other relevant equitable considerations. 
The relative benefits received by the Company and such Standby
Purchasers on the one hand and such underwriters on the other shall be deemed
to be in the same proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company and such Standby Purchasers bear to the total underwriting
discounts and commissions received by such underwriters, in each case as set
forth in the table on the cover page of the prospectus.  The relative fault of the Company and such
Standby Purchasers on the one hand and of such underwriters on the other shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company and
such Standby Purchasers or by such underwriters.  The relative fault of the

 

19

 

Company on the one hand and of each such Standby Purchaser on the other
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by such party, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.

 

The Company
and the Standby Purchasers agree that it would not be just and equitable if
contribution pursuant to this Section 2.08 were determined by pro rata
allocation (even if the underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding
paragraph.  The amount paid or payable by
an Indemnified Party as a result of the Damages referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such
Indemnified Party in connection with investigating or defending any such action
or claim.  No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. 
Each Standby Purchaser’s obligation to contribute pursuant to this Section 2.08
is several in the proportion that the proceeds of the offering received by such
Standby Purchaser bears to the total proceeds of the offering received by all
such Standby Purchasers and not joint.

 

Section 2.09                                Participation
in Public Offering.  No Standby
Purchaser may participate in any Public Offering permitted under Section 2.01
or 2.02 unless such Standby Purchaser (a) agrees to sell such Standby
Purchaser’s Registrable Securities on the basis provided in any underwriting
arrangements, uniformly applied, approved by the Requesting Standby Purchasers
or the Company, as applicable, and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements and the provisions of this Agreement in respect of registration
rights.

 

Section 2.10                                Other
Indemnification.  Indemnification
similar to that specified herein (with appropriate modifications) shall be
given by the Company and each Standby Purchaser participating therein with
respect to any required registration or other qualification of securities under
any federal or state law or regulation or governmental authority other than the
Securities Act.

 

20

 

Section 2.11                                Cooperation
by the Company.

 

(a)                                  If any Standby Purchaser shall
transfer any Registrable Securities pursuant to Rule 144, the Company
shall cooperate, to the extent commercially reasonable, with such Standby
Purchaser and shall provide to such Standby Purchaser such information as such
Standby Purchaser shall reasonably request.

 

(b)                                 If any Standby Purchaser shall
transfer any Registrable Securities in a transaction that is otherwise exempt
from registration under the Securities Act, the Company shall cooperate with
such Standby Purchaser and shall cause the transfer to be recorded on the books
and records of the Company maintained for such purposes as soon as practicable
after the Standby Purchaser has provided the Company with such transfer
documentation, including any opinion of counsel, as the Company shall
reasonably and timely request.

 

Section 2.12                                No
Transfer of Registration Rights. 
None of the rights of Standby Purchasers under this Article 2 shall
be assignable by any Standby Purchaser to any Person acquiring Securities in
any Public Offering.

 

ARTICLE
3

CERTAIN COVENANTS AND AGREEMENTS

 

Section 3.01                                Limitations
on Subsequent Registration Rights. 
The Company agrees that it shall not enter into any agreement with any
holder or prospective holder of any securities of the Company (a) that
would allow such holder or prospective holder to include such securities in any
Demand Registration or Piggyback Registration unless, under the terms of such
agreement, such holder or prospective holder may include such securities in any
such registration only to the extent that their inclusion would not reduce the
amount of the Registrable Securities of the Standby Purchasers included therein
or (b) on terms otherwise more favorable than this Agreement.

 

Section 3.02                                Charter
or Bylaw Provisions.  Each Standby
Purchaser agrees to vote its Company Securities or execute proxies or written
consents, as the case may be, to ensure that the Company’s certificate of
incorporation and bylaws (a) facilitate, and do not at any time conflict
with, any provision of this Agreement and (b) permit each Standby
Purchaser to receive the benefits to which each such Standby Purchaser is
entitled under this Agreement.

 

Section 3.03                                Conflicting
Agreements.  The Company represents
that it has not, and agrees that it shall not, enter into any agreement that is
inconsistent with the rights granted to the holders of Registrable Securities
in this Agreement or otherwise conflicts with the provisions hereof.

 

21

 

ARTICLE
4

MISCELLANEOUS

 

Section 4.01                                Binding
Effect; Assignability; No Third-Party Rights.  This Agreement shall be binding upon and
enforceable by each of the parties hereto and shall inure to the benefit of and
be binding upon the successors, permitted assigns and, subject to Section 2.12,
permitted transferees of each of the parties hereto, including, without
limitation and without the need for an express assignment, subsequent holders
of Registrable Securities.  If any
transferee of any holder of Registrable Securities shall acquire Registrable
Securities, in any manner, whether by operation of law or otherwise, such Registrable
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Registrable Securities such Person shall be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement, shall be deemed a party hereto and such
Person shall be entitled to receive the benefits hereof.  Nothing expressed or referred to in this
Agreement will be construed to give any Person other than the parties to this
Agreement any legal or equitable right, remedy or claim under or with respect
to this Agreement or any provision of this Agreement, except such rights,
remedies and claims as shall inure to a successor, permitted assignee or
permitted transferee pursuant to this Section 4.01.

 

Section 4.02                                Notices.  All notices, requests and other
communications (collectively, “Communications”)
to any party shall be in writing and shall be delivered in person, mailed by
certified or registered mail, return receipt requested, or sent by facsimile
transmission,

 

if to the Company, to:

 

Safety-Kleen HoldCo., Inc.

5400 Legacy Drive

Cluster II, Building 3

Plano, TX  75024

Facsimile:  (972) 265-2991

Attn:  T.R. Tunnell

 

if to any
Standby Purchaser, to:

 

The address of
such Standby Purchaser listed on Schedule I, or such other address as provided
by such Standby Purchaser to the Company.

 

22

 

All
Communications shall be deemed received on the earliest of (i) the date
such Communication is sent by facsimile transmission, (ii) the date such
Communication is delivered in person, (iii) the day after the date such
Communication is placed in overnight mail with a national overnight courier
service or (iv) three days after the date such Communication is mailed by certified
or registered mail, in each case so long as such day is a Business Day.  If such day is not a Business Day, any such
Communication shall be deemed not to have been received until the next
succeeding Business Day.  Any
Communication sent by facsimile transmission shall be confirmed by certified or
registered mail, return receipt requested, posted within one Business Day, or
by personal delivery, whether courier or otherwise, made within two Business
Days after the date of such facsimile transmissions.

 

Any Person
that becomes a Standby Purchaser shall provide its address and fax number to
the Company, which shall, upon request, promptly provide such information to
any Standby Purchaser requesting such information.

 

Section 4.03                                Waiver;
Amendment.  No provision of this
Agreement may be waived except by an instrument in writing executed by the
party against whom the waiver is to be effective.  No provision of this Agreement may be amended
or otherwise modified except by an instrument in writing executed by the
Company with approval of (i) a majority of the Board and (ii) Standby
Purchasers holding at least sixty-six and two-thirds percent (66 2/3%) of the
then outstanding Registrable Securities held by all Standby Purchasers in the
aggregate; except that no amendment or modification to this Agreement shall (1) reduce
the number of Demand Registrations; (2) increase the percentage of the
outstanding shares of Common Stock required to be held by Standby Purchasers
exercising a Demand Registration; (3) increase the minimum aggregate
market price or fair value required to be included in any Demand Registration; (4) increase
the percentage of the outstanding shares of Common Stock required to be held by
Standby Purchasers requesting the listing or quotation of the Common Stock; or (5) result
in disproportionate treatment of the Standby Purchasers, other than as a result
of their disproportionate holdings of Registrable Securities.

 

Section 4.04                                Fees
and Expenses.  Except as may be
otherwise provided herein or in any other agreement between or among any
parties hereto, the fees and expenses incurred by any Standby Purchaser in
connection with this Agreement, any amendment or waiver hereof and the
transactions contemplated hereby and all matters related hereto shall be paid
by such Standby Purchaser.

 

Section 4.05                                Governing
Law.  This Agreement shall be
governed by, and construed in accordance with, the laws of the State of
Delaware, without regard to the conflicts of laws rules of such state.

 

23

 

Section 4.06           Jurisdiction.  Each of the Company and the Standby
Purchasers hereby irrevocably submits any suit, action or proceeding arising
out of or relating to this Agreement or any of the transactions contemplated
hereby to the exclusive jurisdiction and venue of the federal and state courts
located in the State of Delaware and irrevocable waives any and all objections
to exclusive jurisdiction or review of venue that any such party may have under
the laws of the State of Delaware or of the United States.

 

Section 4.07           Specific Enforcement.  Each party hereto acknowledges that the
remedies at law of the other parties for a breach or threatened breach of this
Agreement would be inadequate and, in recognition of this fact, any party to
this Agreement, without posting any bond, and in addition to all other remedies
that may be available, shall be entitled to obtain equitable relief in the form
of specific performance, a temporary restraining order, a temporary or
permanent injunction or any other equitable remedy that may then be available.

 

Section 4.08           Entire Agreement.  This Agreement constitutes the entire
agreement among the parties hereto and supersedes all prior and contemporaneous
agreements and understandings, both oral and written, among the parties hereto
with respect to the subject matter hereof.

 

Section 4.09           Severability.  If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party.  Upon such a determination, the parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner so that
the transactions contemplated hereby be consummated as originally contemplated
to the fullest extent possible.

 

Section 4.10           Rights Agreement Acknowledgement.  It is agreed and acknowledged that this
Agreement and the transactions that it contemplates are each a “transaction
contemplated to be effected or facilitated in connection with the Rights
Offering,” for purposes of Section 2 and Section 3 of the First
Amendment to Rights Agreement, made as of July 5, 2006, between the Company
and Wells Fargo, N.A., a national banking association, as Rights Agent, and
that no Person, by reason of any activity undertaken pursuant to or in
connection with this Agreement shall become the Beneficial Owner (as defined)
or beneficially own any securities of any other Person (that is not already
otherwise its Affiliate or Associate (as defined)), nor shall it be deemed to
be included in any “group of persons” or be deemed to have “embarked on a
common purpose or act,” for

 

24

 

purpose of the
Rights Agreement, dated April 10, 2006, between the Company and the Rights
Agent (the “Rights Agreement”).  To the extent it may be required to
effectuate the purposes of this paragraph, the Company undertakes to amend the
Rights Agreement as provided in this paragraph.

 

25

 

IN WITNESS WHEREOF, the Company
and each other party hereto have caused this Agreement to be duly executed by
their respective authorized officers as of the day and year first above
written.

 

 

	
   

  	
  SAFETY-KLEEN
  HOLDCO., INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ T.R.
  Tunnell

  
	
   

  	
  Name: T.R.
  Tunnell

  
	
   

  	
  Title: Executive
  Vice President & General Counsel

  

 

26

 

	
   

  	
  STANDBY PURCHASERS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  CONTRARIAN
  SIGNATURE BLOCKS

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CONTRARIAN
  CAPITAL FUND I, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Contrarian
  Capital Management, LLC, 

  
	
   

  	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
   

  	
  Jason
  Mudrick

  
	
   

  	
   

  	
  Portfolio
  Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CCM PENSION,
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Contrarian
  Capital Management, LLC, 

  
	
   

  	
   

  	
   

  	
  Its Managing
  Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
   

  	
  Jason
  Mudrick

  
	
   

  	
   

  	
  Portfolio
  Manager

  

 

27

 

	
   

  	
  CONTRARIAN
  CAPITAL TRADE 

  CLAIMS, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Contrarian
  Capital Management, LLC, 

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
  Jason
  Mudrick

  
	
   

  	
  Portfolio
  Manager

  
	
   

  	
   

  
	
   

  	
  CONTRARIAN
  CAPITAL SENIOR 

  SECURED,
  L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Contrarian
  Capital Management, LLC, 

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
  Jason
  Mudrick

  
	
   

  	
  Portfolio
  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CONTRARIAN
  LONG SHORT, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Contrarian
  Capital Management, LLC, 

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
  Jason
  Mudrick

  
	
   

  	
  Portfolio
  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CONTRARIAN
  SOCIALLY RESPONSIBLE, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Contrarian Capital
  Management, LLC, 

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
  Jason
  Mudrick

  
	
   

  	
  Portfolio
  Manager

  
							

 

28

 

	
   

  	
  CONTRARIAN
  EQUITY FUND, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Contrarian
  Capital Management, LLC, 

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
  Jason
  Mudrick

  
	
   

  	
  Portfolio
  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CONTRARIAN CAPITAL FINANCE, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Contrarian
  Capital Management, LLC, 

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jason
  Mudrick

  
	
   

  	
  Jason
  Mudrick

  
	
   

  	
  Portfolio
  Manager

  

 

29

 

	
   

  	
  GSC
  SIGNATURE BLOCKS

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GSC RECOVERY
  II, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  GSC RECOVERY
  II GP, L.P.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
  By:

  	
  GSC RII,
  LLC,.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
  By:

  	
  GSCP (NJ)
  HOLDINGS, L.P.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
  By:

  	
  GSC RECOVERY
  II GP, L.P.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Matthew
  Kaufman

  
	
   

  	
  Name:

  	
  Matthew
  Kaufman

  
	
   

  	
  Title:

  	
  Senior
  Managing Director

  
	
   

  	
  Date:

  	
  7/19/06

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GSC RECOVERY
  IIA, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  GSC RECOVERY
  IIA GP, L.P.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
  By:

  	
  GSC RIIA,
  LLC,.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
  By:

  	
  GSCP (NJ)
  HOLDINGS, L.P.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
  By:

  	
  GSCP (NJ),
  INC.

  
	
   

  	
   

  	
  Its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Matthew
  Kaufman

  
	
   

  	
  Name:

  	
  Matthew
  Kaufman

  
	
   

  	
  Title:

  	
  Senior
  Managing Director

  
	
   

  	
  Date:

  	
  7/19/06

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GSC
  RECOVERY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Matthew
  Kaufman

  
	
   

  	
  Name:

  	
  Matthew
  Kaufman

  
	
   

  	
  Title:

  	
  Senior
  Managing Director

  
	
   

  	
  Date:

  	
  7/19/06

  
							

 

30

 

	
   

  	
  HIGHLAND
  SIGNATURE BLOCKS

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HIGHLAND
  CORPORATE

  OPPORTUNITIES FUND

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ M. Jason
  Blackburn

  
	
   

  	
  Name:

  	
  M. Jason
  Blackburn

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HIGHLAND
  CREDIT OPPORTUNITIES

  FUND LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  HIGHLAND
  CAPITAL

  MANAGEMENT, L.P.

  As Collateral Manager

  
	
   

  	
  By:

  	
  STRAND
  ADVISORS, INC.

  Its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chad
  Schramek

  
	
   

  	
  Name:

  	
  Chad
  Schramek

  
	
   

  	
  Title:

  	
  Assistant
  Treasurer, Strand Advisors, Inc., General Partner of Highland Capital
  Management L.P.

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HIGHLAND
  CREDIT STRATEGIES 

  MASTER FUND, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  HIGHLAND
  CAPITAL

  MANAGEMENT, L.P.

  As Collateral Manager

  
	
   

  	
  By:

  	
  STRAND
  ADVISORS INC.

  Its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chad
  Schramek

  
	
   

  	
  Name:

  	
  Chad
  Schramek

  
	
   

  	
  Title:

  	
  Assistant
  Treasurer, Strand Advisors, Inc., General Partner of Highland Capital
  Management L.P.

  
	
   

  	
  Date:

  	
   

  
							

 

31

 

	
   

  	
  HIGHLAND
  CRUSADER OFFSHORE 

  PARTNERS, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  HIGHLAND
  CRUSADER FUND GP, 

  L.P.

  Its General Partner

  
	
   

  	
  By:

  	
  HIGHLAND
  CRUSADER GP, LLC

  Its General Partner

  
	
   

  	
  By:

  	
  HIGHLAND
  CAPITAL

  MANAGEMENT, L.P.

  Its Sole Member

  
	
   

  	
  By:

  	
  STRAND
  ADVISORS, INC.

  Its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chad
  Schramek

  
	
   

  	
  Name:

  	
  Chad
  Schramek

  
	
   

  	
  Title:

  	
  Assistant
  Treasurer, Strand Advisors, Inc., General Partner of Highland Capital
  Management L.P.

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HIGHLAND
  SPECIAL OPPORTUNITIES 

  HOLDING COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
  HIGHLAND
  CAPITAL 

  MANAGEMENT, L.P.

  As Collateral Manager

  
	
   

  	
  By:

  	
  STRAND
  ADVISORS, INC.

  Its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chad
  Schramek

  
	
   

  	
  Name:

  	
  Chad
  Schramek

  
	
   

  	
  Title:

  	
  Assistant
  Treasurer, Strand Advisors, Inc., General Partner of Highland Capital
  Management L.P.

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
  RESTORATION
  OPPORTUNITIES FUND

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ M. Jason
  Blackburn

  
	
   

  	
  Name:

  	
  M. Jason
  Blackburn

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
  Date:

  	
   

  
							

 

32

 

	
   

  	
  HIGHLAND
  FINANCIAL CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chad
  Schramek

  
	
   

  	
  Name:

  	
  Chad
  Schramek

  
	
   

  	
  Title:

  	
  Assistant
  Treasurer, Strand Advisors, Inc., General Partner of Highland Capital
  Management L.P.

  
	
   

  	
  Date:

  	
   

  
					

 

33

 

	
   

  	
  JPMORGAN
  SIGNATURE BLOCKS

  
	
   

  	
   

  
	
   

  	
  J.P. MORGAN
  SECURITIES INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John
  Abate

  
	
   

  	
  Name: John
  Abate

  
	
   

  	
  Title: Authorized
  Signatory

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  JPMORGAN
  CHASE BANK, N.A.

  
	
   

  	
  (f/k/a Bank
  One, N.A.)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marina
  S. Flindell

  
	
   

  	
  Name: Marina
  S. Flindell

  
	
   

  	
  Title: Vice
  President

  

 

34Exhibit 10.1.1

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

THIS FIRST AMENDMENT TO  CREDIT AGREEMENT (the “Amendment”),
dated as of June 20, 2008  is among
SAFETY-KLEEN HOLDCO., INC. (“Holdings”), SAFETY-KLEEN SYSTEMS, INC.,
(the “Borrower”), the lenders party hereto, and JPMORGAN CHASE BANK,
NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”).

 

RECITALS:

 

A.                                   The
Borrower, the Administrative Agent, and the lenders party thereto have entered
into that certain Credit Agreement dated as of August 3, 2006 (as the same
may be amended from time to time, the “Agreement”).

 

B.                                     The
Borrower has: (i) requested that its Subsidiary Safety-Kleen Canada, Inc.,
a corporation formed under the laws of the Province of New Brunswick, Canada (“Safety-Kleen
Canada”) be joined as a Loan Party and (ii) advised that Safety-Kleen
Oil Recovery Co. has merged with and into the Borrower.

 

C.                                     Furthermore,
the Borrower has requested that the certain provisions of the Agreement be
amended as herein set forth and the Administrative Agent and the lenders party
hereto are willing to amend the Agreement on the terms and conditions herein
set forth.

 

NOW, THEREFORE, in consideration of the premises
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows effective as of the date hereof unless otherwise indicated:

 

ARTICLE I.

 

Definitions

 

Section 1.1.                                   Definitions.  Capitalized terms used in this Amendment, to
the extent not otherwise defined herein, shall have the same meanings as in the
Agreement, as amended hereby.

 

ARTICLE II.

 

Amendments

 

Section 2.1.                                   Amendment
to Section 1.01 of the Agreement. 
Effective January 1, 2008, the following definitions contained in Section 1.01
of the Agreement are amended in their respective entireties to read as follows:

 

“Excluded Foreign Subsidiary”
means (i) a Foreign Subsidiary or (ii) an entity treated as
disregarded for U.S. federal income tax purposes that owns more than 65% of the
voting stock of a Subsidiary described in clauses (i) or (ii) of
this definition; provided that if (a) a Foreign Subsidiary or subsidiary
of the type described in clause (ii) has, in Borrower’s discretion, become
party to the Security Documents pursuant to Section 5.11 or otherwise; (b) 100%
of the Equity Interests of such Subsidiary (minus director’s qualifying shares
and/or other nominal amounts of shares, in each case required by applicable law
to be held by other Persons) have been pledged under the Security Documents
pursuant to Section 5.11 or otherwise; and (c) to the extent the
applicable entity has been incorporated or formed in a jurisdiction other than
Canada or any Province or territory thereof, the Administrative Agent shall
have determined that the

 

1

 

Liens created
in such Subsidiary’s assets and Equity Interest can be created, attached,
perfected and protected with the priority required hereby and in a manner
reasonably acceptable to the Administrative Agent, including under the laws of
the jurisdiction of the organization of such Subsidiary and all other
applicable jurisdictions in which such Subsidiary’s assets are located, then
such Subsidiary shall not be an Excluded Foreign Subsidiary hereunder.  Any Target whose Equity Interests are
acquired in an acquisition permitted by Section 6.04(k) shall not be
an Excluded Foreign Subsidiary.

 

“Foreign Subsidiary”
means any Subsidiary that is organized under the laws of a jurisdiction that is
not within the United States of America.

 

Section 2.2.                                   Amendment
to Section 5.11 of the Agreement. 
Section 5.11 of the Agreement is amended in its entirety to
read as follows:

 

Section 5.11                                Additional
Subsidiaries.  If any additional
Subsidiary is formed or acquired after the Effective Date or if Borrower elects
at any time to cause a Foreign Subsidiary to become a Subsidiary Loan Party,
Holdings will notify the Administrative Agent and the Lenders thereof and (a) if
such Subsidiary is (x) a Domestic Subsidiary (which is not an Excluded
Foreign Subsidiary) or (y) a Foreign Subsidiary that Borrower elects not
to be categorized as an Excluded Foreign Subsidiary or that was a Target of an
acquisition permitted by Section 6.04(k), Holdings will:  (i) cause such Subsidiary to become a
party to the Security Documents promptly after such Subsidiary is formed or
acquired; (ii) deliver all documentation as the Administrative Agent may
require to evidence the authority of such Subsidiary to execute, deliver and
perform the Loan Documents and to evidence the existence and good standing of
such Subsidiary; and (iii) cause such Subsidiary to promptly take such
actions to create and perfect Liens on such Subsidiary’s assets to secure the
Obligations as the Administrative Agent shall reasonably request and (b) if
any Equity Interest in such Subsidiary are owned by any Loan Party, Holdings
will cause such Equity Interests to be pledged pursuant to the Security
Documents promptly after such Subsidiary is formed or acquired (except that, if
such Subsidiary is an Excluded Foreign Subsidiary, the Equity Interests issued
by such Subsidiary to be pledged pursuant to the Security Documents shall be
limited to 65% of the outstanding voting Equity Interests of such Subsidiary).

 

Section 2.3.                                   Amendment
to Section 5.12 (b) of the Agreement.  Subclause (iv) contained in Clause
(b) of Section 5.12 of the Agreement is amended in its
entirety to read as follows:

 

(iv) property
of a Domestic Subsidiary located outside the United States of America and
property of any other Subsidiary Loan Party located outside the country of its
organization)

 

Section 2.4.                                   Amendment
to Section 5.12 (d) of the Agreement.  Clause (d) of Section 5.12
of the Agreement is amended in its entirety to read as follows:

 

(d)                                 Canadian
Collateral.  Notwithstanding anything
contained in any Loan Document to the contrary, on or before August 31,
2008, Holdings shall deliver to the Administrative Agent such documentation
reasonably requested by the Administrative Agent to create, perfect, and protect
the security interest and other Liens of the Administrative Agent in: (A) 100%
of the Equity Interest owned by the Borrower in Safety-Kleen Canada, (B) 100%
of the Equity Interests owned by Safety-Kleen Canada in Environnement Services
et Machinerie E.S.M., Inc., a corporation formed under the laws of the
Province of Quebec, Canada, (C) substantially all the other personal
property

 

2

 

assets of
Safety-Kleen Canada located in Canada (subject however, to the terms of the
Security Agreement), and (D) the parcels of real property owned by
Safety-Kleen Canada in Delta, British Columbia, Brampton, Ontario and Breslau,
Ontario.  Such documentation shall
include the documentation that is appropriate under the laws of Canada and the
applicable Provinces and territories thereof of the type described in clauses
5.12(b) and Section 5.12(c)(ii).

 

Section 2.5.                                   Amendment
to Section 6.04(c) of the Agreement.  Effective January 1, 2008, Clause (c) of
Section 6.04 of the Agreement is amended in its entirety as
follows:

 

(c)                                  investments
by Holdings and the Subsidiaries in Equity Interests in their respective
Subsidiaries (including any Person who after giving effect to such investment
becomes a Subsidiary); provided that (i) any such Equity Interests
held by a Loan Party shall be pledged pursuant to the Security Documents
(subject to the limitations applicable to common stock of an Excluded Foreign
Subsidiary referred to in Section 5.11); (ii) the aggregate amount of
the Net Investments by Loan Parties in Subsidiaries who are not Loan Parties
shall not exceed $30,000,000 at any time; and (iii) the aggregate amount
of the Net Investments by Loan Parties in Subsidiaries that are organized under
the laws of Mexico shall not exceed $10,000,000 at any time (as used in this
paragraph (c), the term “Net Investments” means at any time and with
respect to any Loan Party, the sum of the following calculated without
duplication: (i) aggregate costs of the investments made since the
Effective Date by such Loan Party in Subsidiaries who are not, at the time of
calculation of Net Investments, Loan Parties (including, if required by Section 4.5
of the Security Agreement, the amount of the excess above $2,500,000 in book
value of Collateral which is located outside the country of organization of
each Loan Party where the actions required by Section 4.5 of the Security
Agreement have not been taken); minus (ii) all dividends, returns of
capital and other distributions by such Subsidiaries to the applicable Loan
Party made after the Effective Date; plus (iii) the principal amount of
the loans and advances by the applicable Loan Party to such Subsidiaries that
are then outstanding; plus (iv) the then outstanding amount of all
Indebtedness of the type described in clauses (a) through (e), (h), (k), (l) and
(n) of the definition thereof Guaranteed by the applicable Loan Party of
Indebtedness of such Subsidiaries; plus (v) the aggregate amount paid by
the applicable Loan Party under Guarantees of obligations (other than
Indebtedness) of such Subsidiaries since the Effective Date);

 

Section 2.6.                                   Amendment
to Section 6.04(k)(ii) of the Agreement.  Effective January 1, 2008, Subclause (ii) of
clause (k) of Section 6.04 of the Agreement is amended
in its entirety as follows:

 

(ii)                                  Purchase
Price Limitation.  The sum of the
Purchase Price for the acquisition in question plus the aggregate of all
Purchase Prices paid for all acquisitions consummated under the permissions of
this paragraph (k) in the same fiscal year does not exceed $100,000,000
plus the then available amount of the Public Offering Basket; provided that:

 

(A)                              if
the Leverage Ratio is greater than 4.00 to 1.00 (as calculated based on the
most recently ended four fiscal quarter period for which financial statements
are available and on a pro forma basis for the acquisition in question assuming
that the acquisition occurred on the first day of the applicable period), then
the Purchase Price for the acquisition in question plus the aggregate of all Purchase
Prices paid for all acquisitions consummated under the permissions of this
paragraph (k) in the same fiscal year does not exceed $25,000,000 and

 

3

 

(B)                                the
Purchase Price for an acquisition financed with the proceeds of a Loan made
under the commitments provided for pursuant to Section 2.20 shall be
excluded from any calculation under this clause (ii).

 

As used herein the following terms have the following
meanings:

 

“Purchase Price” means,
as of any date of determination and with respect to a proposed (or completed)
acquisition, the purchase price to be paid (or actually paid) for the Target or
its assets, including all cash consideration paid (including the then estimated
amount of deferred purchase price obligations) or to be paid (based on the
estimated amount thereof), the value of all other assets to be transferred by
the purchaser in connection with such acquisition to the seller all valued in
accordance with the applicable purchase agreement and the outstanding principal
amount of all Indebtedness of the Target or the seller assumed or acquired in
connection with such acquisition; excluding however, any portion thereof paid
for by the issuance of Equity Interest in Holdings.

 

“Public Offering Basket”
means, as of any date of determination, the positive amount, if any, equal to
the sum of (a) the Public Offering Amount minus (b) the Excess
Acquisition Amount minus (c) the Excess Capital Expenditure Amount.

 

“Public Offering Amount”
means the amount, if any, of the Net Proceeds actually received by Holdings
from the public offerings of its common stock after June 20, 2008.

 

“Excess Acquisition Amount”
means, as of any date of determination, the sum of all Yearly Excess
Acquisition Amounts for all fiscal years to have completely elapsed from and
including the fiscal year beginning December 30, 2007 to and including the
then current fiscal year (even if not then completely elapsed).

 

“Yearly Excess Acquisition
Amount” means, for any fiscal year or portion thereof, the amount by which,
if any, the aggregate of all Purchase Prices paid for all acquisitions
consummated under the permissions of this paragraph (k) during such fiscal
year exceed $100,000,000.

 

“Excess Capital Expenditure
Amount” means, as of any date of determination, the sum of all Yearly
Excess Capital Expenditure Amounts for all fiscal years to have completely
elapsed from and including the fiscal year beginning December 30, 2007 to
and including the then current fiscal year (even if not then completely
elapsed).

 

“Yearly Excess Capital
Expenditure Amount” means, for any fiscal year or portion thereof, the
amount by which, if any, the aggregate amount of Adjusted Capital Expenditures
made in such fiscal year are in excess of the amounts that would otherwise be
permitted for such fiscal year if the Adjusted Capital Expenditures were
limited during such fiscal year to only the amounts determined pursuant to
clauses (i) and (ii) of the definition of the term “Capital
Expenditure Limit” in Section 7.03.

 

Section 2.7.                                   Amendment
to Section 6.04(k)(iv) of the Agreement.  Effective January 1, 2008, subclause (iv) of
clause (k) of Section 6.04 of the Agreement is amended
in its entirety as follows:

 

(iv)                              Target.  The Target: (A) is organized under the
laws of a jurisdiction within the United States of America, a jurisdiction in
Canada or any other jurisdiction as long as, with respect to such other
jurisdictions, the Administrative Agent can obtain Liens in the assets and, if
applicable, the Equity Interests of the Target as required under 

 

4

 

the Loan
Documents, with the priority required hereby and in a manner reasonably
acceptable to the Administrative Agent and (B) is involved in the same
general type of business activities as the Borrower and the subsidiaries of the
Borrower or business reasonably related thereto or ancillary or complimentary
thereto;

 

Section 2.8.                                   Amendment
to Section 6.04(k)(viii) of the Agreement.  Effective January 1, 2008, Subclause (viii) of
clause (k) of Section 6.04 of the Agreement is amended
in its entirety as follows:

 

(viii)                        Structure.  If the proposed acquisition is an acquisition
of the stock or other Equity Interest issued by a Target, the acquisition will
be structured so that the Target will become a Loan Party who is a Wholly-Owned
Subsidiary of the Borrower or will be merged with or into the Borrower or a
Loan Party who is a Wholly-Owned Subsidiary of the Borrower.  If the proposed acquisition is an acquisition
of assets, the acquisition will be structured so that the Borrower or a Loan
Party who is a Wholly-Owned Subsidiary of the Borrower shall acquire the assets
either directly or through a merger;

 

Section 2.9.                                   Amendment
to Section 6.04(n) of the Agreement.  Effective January 1, 2008, clause (n) of
Section 6.04 of the Agreement is amended in its entirety as
follows:

 

(n)                                 in
addition to the investments otherwise permitted by this Section 6.04, the
Borrower and the Subsidiaries may acquire after the Effective Date, Equity Interests
in or other securities of, make loans or advances to, Guarantee any obligations
of, or make any other investment in (including, without limitation, acquiring
all or substantially all of the assets of a Person or a division or branch of
such Person or any other assets of any other Person constituting a business
unit), any other Person if the aggregate amount expended to make all such
investments consummated under the permissions of this paragraph (n) since June 20,
2008 shall not exceed an amount equal to $10,000,000; provided that as of the
date of any such investment and after giving effect thereto, (i) no
Default shall exist or result therefrom; and (ii) no investment made under
this paragraph (n) shall increase the aggregate amount of investments
permitted by paragraph (c) of this Section 6.04.

 

Section 2.10.                             Amendment
to Section 7.03 of the Agreement. 
Section 7.03 of the Agreement is amended in its entirety as
follows:

 

Section 7.03.                             Capital
Expenditures.  During each fiscal
year, the aggregate amount of all Adjusted Capital Expenditures of Holdings and
the Subsidiaries will not exceed the applicable Capital Expenditure Limit for
such fiscal year.  The term “Capital
Expenditure Limit” means the sum of the following:  (i) the amount set forth in the table
below opposite the applicable fiscal year in the table below (for each such
year, the “Yearly Limit”) plus (ii) the portion of the Yearly Limit
from the immediately preceding fiscal year which was not expended by Holdings
and the Subsidiaries for Capital Expenditures in such preceding fiscal year
(the “Carryover Amount”) plus (iii) the then available amount of
the Public Offering Basket.  In
calculating the Carryover Amount for any fiscal year, the Yearly Limit
applicable to the previous fiscal year shall be deemed to have been utilized
first by any Capital Expenditures made in such fiscal year.

 

5

 

	
  Fiscal Year Ending on or About

  	
   

  	
  Yearly Limit

  	
   

  
	
  December 31, 2006

  	
   

  	
  $

  	
  40,000,000

  	
   

  
	
  December 31, 2007

  	
   

  	
  $

  	
  40,000,000

  	
   

  
	
  December 31, 2008 and each fiscal year
  thereafter

  	
   

  	
  $

  	
  75,000,000

  	
   

  

 

“Adjusted Capital
Expenditures” means, for any period, all Capital Expenditures incurred
during such period, minus the following, but only to the extent included in
such Capital Expenditures:

 

(a)                                  Environmental
Liability Expenditures made during such period in an aggregate amount of
$12,000,000 or less (or if Environmental Liability Expenditures are not
otherwise included in Capital Expenditures during such period, plus Environmental
Liability Expenditures in excess of $12,000,000 in such period);

 

(b)                                 Capital
Expenditures financed during such period with the proceeds of Loans made under
the commitments provided for in Section 2.20 of this Agreement;

 

(c)                                  Capital
Expenditures made during such period to acquire equipment owned by the Borrower
or one of its Subsidiaries and delivered to a customer for use by the customer
in the ordinary course of the Borrower’s or such Subsidiaries’ business; and

 

(d)                                 Capital
Expenditures paid for during such period with the proceeds from permitted asset
dispositions and casualty and condemnation events.

 

Section 2.11.                             Amendment
to Exhibit B of the Agreement.  Exhibit B
of the Agreement is amended in its entirety to read as set forth on Exhibit B
hereto.

 

ARTICLE III.

 

Conditions Precedent

 

Section 3.1.                                   Conditions.  The effectiveness of Article II of this
Amendment is subject to the satisfaction of the following conditions precedent:

 

(a)                                  The
Administrative Agent shall have received, each in form and substance reasonably
satisfactory to the Administrative Agent, the following:

 

(i)                                     this
Amendment duly executed by the Borrower, the Guarantors and the Required
Lenders;

 

(ii)                                  A
Second Amendment to Security Agreement duly executed by the Borrower and the
Guarantors in the form attached hereto as Exhibit C (each Lender party
hereto authorizing the Administrative Agent to execute and deliver such Second
Amendment to Security Agreement on behalf of the Lenders);

 

(iii)                               a Subsidiary Joinder
Agreement duly executed by Safety-Kleen Canada;

 

6

 

(iv)                              such
documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good standing of
Safety-Kleen Canada and Environnement Services et Machinerie E.S.M., Inc.,
a corporation formed under the laws of the Province of Quebec, Canada, the
power and authority of Safety-Kleen Canada to execute, deliver and perform the
Loan Documents to which it is a party and any other legal matters relating to
the Borrower, Safety-Kleen Canada, any Guarantor or the Loan Documents as the
Administrative Agent may reasonably request; and

 

(v)                                 evidence
of the merger of Safety-Kleen Oil Recovery Co. with and into the Borrower; and

 

(b)                                 Each
Lender who has executed this Amendment by 5:00 P.M. (Dallas, Texas time)
on June 20, 2008 shall have received an amendment fee equal to 0.25% of
its Commitment;

 

(c)                                  The
representations and warranties contained herein and in all other Loan Documents,
as amended hereby, shall be true and correct in all material respects as of the
date hereof as if made on the date hereof, except for such representations and
warranties limited by their terms to a specific date; and

 

(d)                                 No
Default shall exist.

 

ARTICLE IV.

 

Miscellaneous

 

Section 4.1.                                   Ratifications.  The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Agreement and except as expressly modified and superseded by this
Amendment, the terms and provisions of the Agreement and the other Loan
Documents are ratified and confirmed and shall continue in full force and
effect. The Borrower, Holdings, the Administrative Agent and the Lenders agree
that the Agreement as amended hereby and the other Loan Documents shall
continue to be legal, valid, binding and enforceable in accordance with its
terms. For all matters arising prior to the effective date of this Amendment,
the Agreement (as unmodified by this Amendment) shall control.

 

Section 4.2.                                   Representations
and Warranties.  Each of the Borrower
and the Guarantors (by their execution below) hereby represents and warrants to
the Administrative Agent and the Lenders as follows:  (a) no Default exists, (b) the
representations and warranties set forth in the Loan Documents are true and
correct on and as of the date hereof with the same effect as though made on and
as of such date except with respect to any representations and warranties
limited by their terms to a specific date, and (c) there are no claims or
offsets against or rights of recoupment with respect to or defenses or
counterclaims to its obligations under the Loan Documents.

 

Section 4.3.                                   Survival
of Representations and Warranties. 
All representations and warranties made in this Amendment shall survive
the execution and delivery of this Amendment, and no investigation by
Administrative Agent or the Lenders or any closing shall affect the
representations and warranties or the right of the Administrative Agent or the
Lenders to rely upon them.

 

Section 4.4.                                   Reference
to Agreement.  Each of the Loan
Documents, including the Agreement and any and all other agreements, documents,
or instruments now or hereafter executed and delivered pursuant to the terms
hereof or pursuant to the terms of the Agreement as amended hereby, are hereby
amended so that any reference in such Loan Documents to the Agreement shall
mean a reference to the Agreement as amended hereby.

 

7

 

Section 4.5.                                   Expenses
of Administrative Agent.  As provided
in the Agreement, Borrower agrees to pay on demand all reasonable out-of pocket
costs and expenses incurred by the Administrative Agent in connection with the
preparation, negotiation, and execution of this Amendment, including without
limitation, the reasonable costs and fees of the Administrative Agent’s legal
counsel.

 

Section 4.6.                                   Severability.  Any provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.

 

Section 4.7.                                   Applicable
Law.  This Amendment shall be
governed by and construed in accordance with the applicable law pertaining in
the State of New York, other than those conflict of law provisions that would
defer to the substantive laws of another jurisdiction.  This governing law election has been made by
the parties in reliance (at least in part) on Section 5–1401 of the
General Obligations Law of the State of New York, as amended (as and to the
extent applicable), and other applicable law.

 

Section 4.8.                                   Successors
and Assigns.  This Amendment is
binding upon and shall inure to the benefit of the Administrative Agent, the
Lenders, the Borrower, each Guarantor and their respective successors and
assigns, except neither Borrower nor any Guarantor may assign or transfer any
of its rights or obligations hereunder without the prior written consent of the
Lenders.

 

Section 4.9.                                   Effectiveness;
Counterparts.  Subject to Article III
hereof, this Amendment shall become effective when it shall have been executed
by the Administrative Agent, when the Administrative Agent shall have received
counterparts hereof from Holdings, the Borrower and the Guarantors and when the
Administrative Agent shall have received counterparts hereof from the Required
Lenders (which may be sent on pages designated only as “Safety-Kleen
Systems, Inc. June 20, 2008 First Amendment to Credit Agreement,
Signature Page” or similar designation, without page numbers or other
identifying information) and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.  Delivery of an executed counterpart of a
signature page of this Agreement by telecopy or other electronic
communication shall be effective as delivery of a manually executed counterpart
of this Agreement.  Pursuant to Section 10.02
of the Agreement, the Agreement may be modified as provided in this Amendment
with the agreement of the Required Lenders which means Lenders having Revolving
Exposures, Term Loans, Synthetic L/C Loans and unused Commitments representing
more than 50% of the sum of the total Revolving Exposures, outstanding Term
Loans, outstanding Synthetic L/C Loans and unused Commitments at such time
(such percentage applicable to a Lender, herein such Lender’s “Required
Lender Percentage”).  For purposes of
determining the effectiveness of this Amendment, the Required Lender Percentage
of each Lender that has executed this Amendment is set forth on Schedule 4.9
hereto.

 

Section 4.10.                             Effect
of Waiver.  No consent or waiver,
express or implied, by the Administrative Agent or the Lenders to or for any
breach of or deviation from any covenant, condition or duty by the Borrower or
any Guarantor shall be deemed a consent or waiver to or of any other breach of
the same or any other covenant, condition or duty.

 

Section 4.11.                             Headings.  The headings, captions, and arrangements used
in this Amendment are for convenience only and shall not affect the
interpretation of this Amendment.

 

Section 4.12.                             ENTIRE
AGREEMENT.  THIS AMENDMENT EMBODIES
THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDES ANY AND ALL
PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER
WRITTEN OR ORAL, RELATING TO THIS AMENDMENT, AND MAY NOT BE CONTRADICTED
OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR

 

8

 

SUBSEQUENT
ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO.  THERE ARE NO ORAL AGREEMENTS AMONG THE
PARTIES HERETO.

 

Executed as of the date first written above.

 

	
   

  	
  SAFETY-KLEEN
  HOLDCO., INC.

  
	
   

  	
  SAFETY-KLEEN
  SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dennis
  McGill

  
	
   

  	
   

  	
  Dennis McGill,
  Executive Vice President and Chief

  Financial Officer of Holdings and the Borrower

  

 

9

 

Guarantor Consent

 

Each of the undersigned Guarantors:  (i) consents and agrees to this First
Amendment to Credit Agreement dated June 20, 2008, including, without
limitation, Section 4.2 thereof, and (ii) agrees that each of the
Guaranty Agreement, the Security Agreement and the other Loan Documents to
which is it a party are each in full force and effect and continue to be its
legal, valid and binding obligation enforceable against it in accordance with
its respective terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered
in a proceeding in equity or at law.

 

	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  SK HOLDING COMPANY, INC.

  
	
   

  	
  ECOGARD, INC.,

  
	
   

  	
  SAFETY-KLEEN INTERNATIONAL,
  INC.

  
	
   

  	
  SAFETY-KLEEN ENVIROSYSTEMS
  COMPANY OF PUERTO RICO, INC.,

  
	
   

  	
  SAFETY-KLEEN ENVIROSYSTEMS
  COMPANY

  
	
   

  	
  ENVIRONMENTAL, ECOLOGICAL
  AND ENGINEERING COMPANY,

  
	
   

  	
  THE SOLVENTS RECOVERY
  SERVICE OF NEW JERSEY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dennis McGill

  
	
   

  	
   

  	
  Dennis McGill, Executive Vice President and Chief Financial
  Officer of each Guarantor

  

 

10

 

	
   

  	
  JPMORGAN CHASE BANK, N.A., as the 

  Administrative Agent and as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian McDougal

  	
   

  
	
   

  	
   

  	
  Brian McDougal, Vice President

  

 

	
  Revolving Commitment:

  	
  $

  	
  30,000,000

  	
   

  
	
  Synthetic L/C
  Commitment:

  	
  $

  	
  0

  	
   

  
	
  Synthetic L/C Loans:

  	
  $

  	
  0

  	
   

  
	
  Term Loans:

  	
  $

  	
  0

  	
   

  
	
  Required Bank
  Percentage

  	
  7.760962359

  	
  %

  

 

Safety-Kleen Systems,
Inc. June 20, 2008 First Amendment to Credit Agreement, Signature Page

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