Document:

exv10w35

 

EXHIBIT
10.35

NON-COMPETITION AND NON-DISCLOSURE AGREEMENT

     NON-COMPETITION AND NON-DISCLOSURE AGREEMENT dated as of February 24, 2004, by and among (i)
BRS-HCC Investment Co., Inc. (“BRS-HCC”), Bruckmann, Rosser, Sherrill & Co. II, L.P., a
Delaware limited partnership (“BRSLP”), Bruckmann, Rosser, Sherrill & Co., Inc., a
Delaware corporation (“BRSC”) (“BRS-HCC”, “BRSLP” and “BRSC”
collectively “BRS”), and Bruce C. Bruckmann, individually (“BCB”), and (ii)
Heritage-Crystal Clean, LLC, an Indiana limited liability company (“Company”);

WITNESSETH:

     WHEREAS, BRS-HCC is a Unit holder and Member of the Company, BRSLP is a lender to the Company
and the holder of all of the capital stock of BRS-HCC, BRSC is the General Partner of BRSLP and BCB
is a Managing Director of BRSC and it is anticipated that BCB will serve as a director of the
Company; and as a result thereof, BRS and BCB have or will have access to and knowledge of all
business information and confidential data of the Company; and

     WHEREAS, BRSLP’s right to subscribe for and receive ownership of Units in the Company is
expressly conditioned upon BRS’s and BCB’s entering into this Non-Competition and Non-Disclosure
Agreement;

     NOW, THEREFORE, in pursuant of the above and in consideration of the terms and conditions
contained herein and for other good and valuable considerations, the receipt and legal sufficiency
of which are hereby acknowledged, the parties agree as follows:

     (1) Consideration. BRS and BCB acknowledge that the consideration received by BRSLP
under the Purchase Agreement dated February ___, 2004 (“Purchase Agreement”) between the
Company and BRSLP and BRSLP’s Subscription Agreement dated as of the same date is good and
sufficient consideration for BRS’s and BCB’s covenants, agreements and forbearances contained in
this Agreement and that the Company would not have allowed BRS-HCC to subscribe for Units but for
BRS’s and BCB’s entering into this Agreement.

     (2) Non-Disclosure. Neither BRS nor BCB or any of BRS’s partners, shareholders,
directors, employees, agent or contractors will, at any time following this date, disclose to any
person, firm or corporation, any confidential information concerning the Company or its assets or
business, except as may be required by governmental law or regulation or in legal proceedings to
which BRS, BCB or said other parties are subpoenaed to give testimony, in which event BRS and/or
BCB, as the case may be, shall notify the Company promptly upon learning that BRS, BCB or any of
said parties may be required or compelled to divulge any confidential information. However, the
foregoing shall not prohibit the disclosure by BRS-HCC or BRSLP to its investors; however, BRSLP
shall impose upon its investors reasonable confidentiality restrictions and BRSLP shall be liable
for any breach by its investors of such confidentiality restrictions which results in damages to
the Company. For purposes of this Agreement, “confidential information” consists of that
proprietary information subject to protection under the Uniform Trade Secrets Act and includes,
without limitation, the Company’s customer list and

 

 

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price information for all customers and other intangible property. “Confidential information”
does not include information in the public domain through no fault of BRS or BCB or reasonably
discoverable without access to internal documents or information.

     (3) Non Competition. During the term of BRS-HCC’s ownership of Units and for a period
of two (2) years from the date of BRS-HCC’s cessation of such ownership (“Restricted
Period”), BRS and BCB will not, other than for the exclusive benefit of the Company, directly
or indirectly engage in the Business (as defined below), whether as an employee, owner, member,
manager, consultant, agent, partner, lender, service provider or in any other capacity. For
purposes of this Agreement, the term “Business” means the business of providing “parts
cleaning services” in the United States or Canada (the “Territory”) with annual parts
cleaning revenues from such services equal to or greater than $1.0 million. For purposes hereof,
“parts cleaning services” means the sale of services to customers that includes the sale/delivery
of new solvent used in sink-on-drum or vat-type parts cleaning equipment, combined with the removal
of used solvent. The term “solvent” encompasses petroleum hydrocarbons and aqueous cleaning
solutions. Such services may or may not include the sale/provision/loan/lease of parts cleaning
equipment and assistance with customer analysis and characterization, customer compliance and
paperwork; but where included, fees for these additional related services are included in the
definition of parts cleaning revenue.

     (4) Non-Solicitation; Non-Piracy. During the Restricted Period, BRS and BCB will not
directly or indirectly call on any person or business organization which was a customer of the
Company during the BRSLP’s ownership of Units for Business within the Territory. Further, during
the Restricted Period, BRS and BCB will not, without the consent of the Company, for BRS’s or BCB’s
own account or for any third party, directly or indirectly solicit or endeavor to entice away,
offer employment to or employ any person who was employed by the Company during the twelve (12)
month period immediately before the cessation of such ownership.

     (5) [Omitted]

     (6) Default and Remedies. BRS and BCB acknowledge and agree that, if BRS, BCB or any
of the other parties referenced herein directly or indirectly breaches, violates, or fails to
perform fully the obligations under this Agreement (“Default”), each Default shall cause
immediate and irreparable harm to the Company, in a manner which cannot be adequately compensated
in damages. The Company, BRS and BCB agree that in the event of any such Default, the Company, in
addition to all other available remedies at law or in equity, may, insofar as BRS, BCB or the other
parties referenced herein may be concerned, be entitled to temporary, preliminary and permanent
injunctive relief to restrain such Default(s) by BRS, BCB or any of the other parties referenced
herein, and to all of its costs, expenses, and reasonable attorneys’ fees incurred in any
enforcement proceedings in which the Company prevails in whole or in part. Nothing contained
herein shall restrict or limit in any manner the Company’s right to obtain any form of relief,
legal or equitable, in an action brought to enforce the Company’s rights.

     (7) Severability. All provisions of this Agreement are intended to be severable.
Each provision of this Agreement constitutes a separate and distinct covenant. In the event any
term, provision, or restriction in this Agreement is held to be illegal, invalid or unenforceable
in

 

 

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any respect, such finding shall in no way affect the legality, validity, or enforceability of
all other provisions of this Agreement. The Company, BRS and BCB agree that any such unenforceable
term, provision or restriction shall be deemed modified to the extent necessary to permit its
enforcement to the maximum extent permitted by applicable law.

     (8) No Waiver of Rights. Neither any failure or any delay on the part of any party in
exercising its rights shall operate as a waiver, nor shall a single or partial exercise preclude
any further exercise of any right, power, or privilege by any party.

     (9) Governing Law; Jurisdiction and Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois. The state and federal courts
located in Kane County, Illinois, shall be the courts of exclusive jurisdiction and venue over any
enforcement of this Agreement.

     (10) Benefit. This Agreement shall inure to the benefit of and be binding upon the
heirs, executors, administrators, successors and assigns of the parties hereto. BRS hereby agrees
that the provisions of this Agreement, other than the provisions of Section (3) hereof, may be
assigned in whole or in part by the Company to any person acquiring substantially all of the assets
of the Company (whether by purchase, merger or other similar transaction), and BRS hereby consents
to such assignment and agrees to be bound to the assignee under all of the terms and conditions of
this Agreement.

     (11) Notices. All notices and communications hereunder shall be in writing and shall
be deemed to be duly given if delivered in accordance with Section 10(g) of the Purchase Agreement.

     (12) Modification. No waiver, alteration or modification of any provision of this
Agreement will be valid unless made in writing and signed by both parties hereto. The waiver of
any breach or default shall not be deemed to waive any subsequent breach or default.

     (13) Construction. The parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the parties and no presumption
or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any
of the provisions of this Agreement. Any reference to any domestic federal, state or local statute
or law, shall be deemed also to refer to all rules and regulations promulgated thereunder, unless
the context requires otherwise. The word “including” shall mean including without limitation. The
parties intend that each representation, warranty, and covenant contained therein shall have
independent significance. If any party has breached any representation, warranty, or covenant
contained herein in any respect, the fact that there exists another representation, warranty, or
covenant relating to the same subject matter (regardless of the relative levels of specificity)
which the party has not breached shall not detract from or mitigate the fact that the party is in
breach of the first representation, warranty, or covenant.

     (14) Entire Agreement. This Agreement constitutes the entire agreement of the parties
relative to the subject matter and supersedes any prior understanding, agreements or

 

 

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representations by or among the parties, written or oral with regard to the subject matter of
this Agreement.

[Signature Pages Follow]

 

 

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     IN WITNESS WHEREOF, the parties have executed this Non-Competition and Non-Disclosure
Agreement as of the date first above written.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Heritage-Crystal Clean, LLC	 	 	 	BRS-HCC Investment Co., Inc.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/  Joe Chalhoub	 	 	 	By:	 	/s/  Bruce C. Bruckmann	 	 	 	 	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Joe Chalhoub
	 	 	 	 	 	  Bruce C. Bruckmann	 	 	 	 	 	 	 	 
	 

	 	President and Chief Executive Officer
	 	 	 	 	 	  President	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Bruckmann, Rosser, Sherrill & Co., Inc.	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s/  Bruce C. Bruckmann	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Bruce C. Bruckmann	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Title:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Bruckmann, Rosser, Sherrill & Co II, L.P.	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	Bruckmann, Rosser,	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Sherrill & Co., Inc., its	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	General Partner	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s/  Bruce C. Bruckmann	 	 	 	 	 	/s/  Bruce C. Bruckmann	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Bruce C. Bruckmann
	 	 	 	 	 	Bruce C. Bruckmann	 	 	 	 	 	 	 	 
	 

	 	Managing Director
	 	 	 	 	 	IndividuallyExhibit 10.5

 

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

THIS FIRST AMENDMENT TO CREDIT AGREEMENT (the “Amendment”) is entered into as of June 27,  2007 (the “Amendment Effective Date”), by and among HEARUSA, INC., a corporation organized under the laws of the State of Delaware (“Borrower”), and SIEMENS HEARING INSTRUMENTS, INC., a corporation organized under the laws of the State of Delaware (“Lender”).

 

R E C I T A L S

 

A.        Borrower and Lender are parties to (a) that certain Second Amended and Restated Credit Agreement dated as of December 30, 2006 (the “Credit Agreement”); (b) that certain Investor Rights Agreement dated as of December 30, 2006 (the “Investor Rights Agreement”); and (c) that certain Amended and Restated Supply Agreement dated as of December 30, 2006 (the “Supply Agreement”).  Unless otherwise indicated herein, all terms used with their initial letter capitalized are used herein with their meaning as defined in the Credit Agreement; all Section references are to Sections in the Credit Agreement; and all Paragraph references are to Paragraphs in this Amendment.

 

B.        On June 29, 2007, Borrower filed with the Securities and Exchange Commission a registration statement on Form S-3 to permit the resale from time to time of the Registrable Securities (as defined in the Investor Rights Agreement) under the Securities Act of 1933, as amended, on a delayed or continuous basis pursuant to Rule 415 (the “Shelf Registration Statement”).

 

C.        Borrower has requested that Section 2.05(c) be amended to extend the date by which the mandatory prepayment is required to be made thereunder from within 180 days of the Closing Date to September 24, 2007.

 

D.        Subject to and upon the following terms and conditions, Lender is willing to extend such mandatory prepayment date.

 

NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Borrower and Lender agree, as follows:

 

1.         Amendment to Credit Agreement.     Section 2.05 of the Credit Agreement is amended by deleting clause (c) in its entirety and substituting therefor the following:

 

(c)       On or prior to September 24, 2007, the Borrower shall make a prepayment of the principal amount of the outstanding Tranche D Loans in the amount of $4,200,000.

 

	
             
 	
            First Amendment to Credit Agreement
 

 

 

 

2.         Covenant.  In consideration of Lender’s extension of the mandatory prepayment date, Borrower agrees to use reasonable best efforts to cause the Shelf Registration Statement to be declared effective as soon as reasonably practical and in any event within ninety (90) days after the effective date of this Amendment.  Borrower’s obligation under this Section 2(a) shall replace the obligation under Section 2.2(a) of the Investor Rights Agreement.

 

3.         Representations and Warranties. As a material inducement to Lender to execute and deliver this Amendment, Borrower hereby represents and warrants to Lender (with the knowledge and intent that Lender is relying upon the same in entering into this Amendment) as follows: 

 

 (a)       after giving effect to this Amendment, the representations and warranties in the Credit Agreement and in all other Loan Documents are true and correct on the date hereof in all material respects, as though made on the date hereof, except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate as of such earlier date); 

 

 (b)       after giving effect to this Amendment, no Default or Event of Default exists under the Loan Documents; 

 

 (c)       Borrower has the right and power, and has taken all necessary action to authorize it to execute, deliver, and perform this Amendment in accordance with its terms and to consummate the transaction contemplated hereby; 

 

 (d)       this Amendment has been duly executed and delivered by the duly authorized officers of Borrower, and is a legal, valid, and binding obligation of Borrower, enforceable against it in accordance with its terms; and 

 

 (e)       the execution, delivery and performance of this Amendment in accordance with its terms, do not and will not, by the passage of time, the giving of notice, or otherwise: (i) conflict with, result in a breach of, or constitute a default under the articles of incorporation or the bylaws of Borrower, or any indenture, agreement, or other instrument to which Borrower is a party or by which it or any of its respective properties may be bound; or (ii) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by Borrower. 

 

4.         Miscellaneous.

 

 (a)       Effect on Loan Documents.  The Credit Agreement and all related Loan Documents shall remain unchanged and in full force and effect, except as provided in this Amendment, and are hereby ratified and confirmed.  On and after the Amendment Effective Date, all references to the “Credit Agreement” or the “Agreement” shall be to the Credit Agreement as herein amended, provided an Event of Default has not occurred hereunder and Lender has cancelled this Amendment.  The execution, delivery, and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any rights of 

 

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            First Amendment to Credit Agreement
 

 

 

 

the Lender under the Credit Agreement or any Loan Documents, nor constitute a waiver under the Credit Agreement or any other provision of the Loan Documents.

 

 (b)       Reference to Miscellaneous Provisions.  This Amendment and the other documents delivered pursuant to this Amendment are part of the Loan Documents referred to in the Credit Agreement, and the provisions relating to Loan Documents set forth in Article VIII of the Credit Agreement are incorporated herein by reference the same as if set forth herein verbatim.

 

 (c)       Costs and Expenses.  Borrower agrees to pay promptly the reasonable fees and expenses of counsel to Lender for services rendered in connection with the preparation, negotiation, reproduction, execution, and delivery of this Amendment.

 

 (d)       Counterparts.  This Amendment may be executed in a number of identical counterparts, each of which shall be deemed an original for all purposes, and all of which constitute, collectively, one agreement; but, in making proof of this Amendment, it shall not be necessary to produce or account for more than one such counterpart.  It is not necessary that all parties execute the same counterpart so long as identical counterparts are executed by Borrower and Lender.

 

 (e)       Parties.  This Amendment is binding on and inures to the benefit of Borrower, Lender, and their respective successors and assigns.

 

REMAINDER OF THIS PAGE INTENTIONALLY BLANK.

SIGNATURE PAGE FOLLOWS

 

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            First Amendment to Credit Agreement
 

 

 

            IN WITNESS WHEREOF, the parties hereto have executed this Amendment in multiple counterparts as of the Amendment Effective Date.

 

	
             
 	
            HEARUSA, INC., as Borrower
 
	
             
 	
             
 	
             
 
	
             
 	
            By:
 	
            /s/ Stephen J. Hansbrough
 
	
             
 	
             
 	
            Name:   Stephen J. Hansbrough
 
	
             
 	
             
 	
            Title:     President and CEO
 

 

 

 

	
             
 	
            SIEMENS HEARING INSTRUMENTS, INC.,
 as Lender
 
	
             
 	
             
 	
             
 
	
             
 	
            By:
 	
            /s/ Christi Pedra
 
	
             
 	
             
 	
            Name:   Christi Pedra
 
	
             
 	
             
 	
            Title:     President and CEO
 

 

 

Signature Page to First Amendment to Credit Agreement

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