-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, I8t1VR+9zAHDK7gyNKh+WHQgeFyAF8ls7IdJfgVnjoqiJM6qXe9UREfZaoWMyp39 iSvZx8VyErQiU6APMJ4FIQ== 0000950131-02-002939.txt : 20020806 0000950131-02-002939.hdr.sgml : 20020806 20020805162002 ACCESSION NUMBER: 0000950131-02-002939 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20020628 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20020805 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STERICYCLE INC CENTRAL INDEX KEY: 0000861878 STANDARD INDUSTRIAL CLASSIFICATION: HAZARDOUS WASTE MANAGEMENT [4955] IRS NUMBER: 363640402 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21229 FILM NUMBER: 02719744 BUSINESS ADDRESS: STREET 1: 28161 NORTH KEITH DRIVE STREET 2: SUITE 410 CITY: LAKE FOREST STATE: IL ZIP: 60045 BUSINESS PHONE: 8473675910 MAIL ADDRESS: STREET 1: 1419 LAKE COOK RD STREET 2: STE 410 CITY: DEERFIELD STATE: IL ZIP: 60015 8-K 1 d8k.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (date of earliest event reported): June 28, 2002 STERICYCLE, INC. (Exact name of registrant as specified in its charter) Delaware 0-21229 36-3640402 (State or other juris- (Commission file (IRS employer diction of incorporation) number) identification number) 28161 North Keith Drive Lake Forest, Illinois 60045 (Address of principal executive offices) Registrant's telephone number, including area code: (847) 367-5910 Item 5. Other Events a. Amendment of Senior Credit Facility On June 28, 2002, Stericycle, Inc. (the "Company") entered into an amendment of its senior secured credit facility increasing the Company's revolving credit facility from $80.0 million to $105.0 million and modifying the loan covenants restricting the Company's payments to purchase or redeem shares of its common stock or to redeem its 12-3/8% senior subordinated notes. A copy of this amendment to the Company's amended and restated credit agreement is filed as Exhibit 10.1 to this Report. b. Cessation of Dividend Accrual on Preferred Stock On July 26, 2002, the Company entered into an amendment and waiver agreement (the "waiver agreement") with the holders of its Series A convertible preferred stock pursuant to which the parties agreed that the 3.375% payment-in-kind dividends payable on the shares of preferred stock ceased to accrue after May 31, 2002 (except in certain limited circumstances), and that the certificate of designation in respect of the rights and preferences of the preferred stock will be amended accordingly (subject to stockholder approval). The holders of the Company's preferred stock consist of two groups of investors. One group is comprised of investment funds associated with Bain Capital, LLC, and the other group is comprised of investment funds associated with Madison Dearborn Partners, LLC. Under the waiver agreement, the Company and the investors also agreed to amend their existing registration rights agreement to modify the investors' right to three demand registrations. As amended and restated as of July 26, 2002, the registration rights agreement provides that each group has the right to two demand registrations, which may consist of two shelf registrations or one shelf registration and one firm commitment underwritten public offering. Under the waiver agreement, the Company and the investors agreed in addition to amend their existing corporate governance agreement to modify the investors' right to name two directors to the Company's board of directors. As amended and restated as of July 26, 2002, the corporate governance agreement provides that each group's right to name one director to the Company's board will terminate if and when the number of shares of common stock issued or issuable upon conversion of the group's shares of preferred stock falls below 25% of the number of shares of common stock issuable upon conversion of the group's shares of preferred stock as of the purchase of those shares in November 1999. Copies of the waiver agreement, the certificate of amendment to the certificate of designation, the amended and restated registration rights agreement, and the amended and restated corporate governance agreement are filed as Exhibits 10.2, 3.1, 4.1 and 10.3, respectively, to this Report. Item 7. Financial Statements and Exhibits The following exhibits are filed with this Report: Exhibit Description ------- ----------- 4.1 Amended and Restated Registration Rights Agreement, dated as of July 26, 2002, between Stericycle, Inc. and certain investment funds associated with Bain Capital, LLC and certain investment funds associated with Madison Dearborn Partners, LLC 10.1 Amendment No. 1 to Amended and Restated Credit Agreement, dated as of June 28, 2002, among Stericycle, Inc. as the borrower, certain subsidiaries of Stericycle, Inc. as guarantors, various financial institutions and other persons as lenders, and Bank of America, N.A., as the administrative agent for the lenders 10.2 Amendment and Waiver Agreement, dated as of July 26, 2002, between Stericycle, Inc. and certain investment funds associated with Bain Capital, LLC and certain investment funds associated with Madison Dearborn Partners, LLC 10.3 Amended and Restated Corporate Governance Agreement, dated as of July 26, 2002, between Stericycle, Inc. and certain investment funds associated with Bain Capital, LLC and certain investment funds associated with Madison Dearborn Partners, LLC Signature Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: August 5, 2002. Stericycle, Inc. By /s/ Frank J.M. ten Brink ---------------------------- Frank J.M. ten Brink Executive Vice President and Chief Financial Officer EX-4.1 3 dex41.txt AMENDED & RESTATED REGISTRATION RIGHTS AGMT Exhibit 4.1 Amended and Restated Registration Rights Agreement This Agreement is entered into as of July 26, 2002 by Stericycle, Inc., a Delaware corporation (the "Company"), and the Persons whose names are set forth on the attached Schedule I (collectively, the "Investors"). A. The Company and the Investors are the parties currently bound by that certain Registration Rights Agreement, dated as of November 12, 1999 (the "1999 Registration Rights Agreement"), which was entered into at the closing of that certain Amended and Restated Series A Convertible Preferred Stock Purchase Agreement, dated September 26, 1999 (the "Purchase Agreement"), pursuant to the terms and conditions of which the Company issued and sold to the purchasers, and the purchasers purchased from the Company, 75,000 shares of the Company's Series A Convertible Preferred Stock (the "Preferred Shares"). B. The Company and the Investors desire to amend and restate the 1999 Registration Rights Agreement as set out in this Agreement. C. This Agreement is entered into pursuant to the Amendment and Waiver Agreement, dated as of the same date as this Agreement (the "Waiver Agreement"), entered into by the Company and the Investors. The execution and delivery of this Agreement by the Company and the Investors is a condition of the Waiver Agreement becoming effective. The Company and the Investors agree that the 1999 Registration Rights Agreement is amended and restated as follows, effective as of June 1, 2002: Capitalized terms which are used in this Agreement without being defined have the same meanings that they are given in the Purchase Agreement. Certain capitalized terms used in this Agreement are defined in the attached Schedule A. 1. Demand Registrations. 1A. General. Holders of a majority of a Group's Registrable Securities then outstanding may request, at any time after August 29, 2002, registration under the Securities Act of all or any portion of their Registrable Securities (a "Demand Registration"). Each Group shall be limited to two Demand Registrations, (i) each of which may be a shelf registration (a "Shelf Registration") pursuant to Rule 415 under the Securities Act (or any successor rule) or (ii) one of which may be a Shelf Registration and the other of which may be a firm commitment underwritten public offering (an "Underwritten Registration"). Each request for a Demand Registration shall specify whether the request is for a Shelf Registration or an Underwritten Registration. In regard to Demand Registrations: (1) Each request for an Underwritten Registration shall specify the approximate number of Registrable Securities requested to be registered. Within 10 days after receipt of any request for an Underwritten Registration, the Company shall give written notice of the requested registration to (i) all other holders of Registrable Securities who are members of the same Group (the "Requesting Group") and (ii) all holders who are members of the other Group (the "Other Group"), and shall include in the registration all Registrable Securities with respect to which the Company has received written requests for inclusion within 15 days after receipt of the Company's notice. The inclusion in the registration of Registrable Securities held by members of the Other Group shall not be counted as one of the Other Group's two permitted Demand Registrations. (2) A Demand Registration shall not be counted as one of the Requesting Group's two permitted Demand Registrations unless (i) it has become effective and (ii) in the case of an Underwritten Registration, the Persons making the request are able to register and sell at least 75% of the Registrable Securities included in the registration. (3) The Company shall pay all Registration Expenses in connection with any Demand Registration whether or not it is counted as one of the Requesting Group's two permitted Demand Registrations. (4) Demand Registrations shall be on Form S-2 or Form S-3 or any similar short-form registration statement, if available. (5) In the case of any Underwritten Registration, the Company shall have the right to select the managing underwriter in connection with the offering, subject to the approval of a majority of the holders of the Registrable Securities requesting registration, and holders of a majority of the Registrable Securities requesting registration shall have the right to select a co-managing underwriter, subject to the Company's approval. 1B. Limit on Registrable Securities. In the case of any Underwritten Registration, if the managing underwriters advise the Company in writing that in their opinion the number of Registrable Securities requested to be included in the offering exceeds the number of Registrable Securities that can be sold without adversely affecting the marketability of the offering, the Company shall include in the registration the number of Registrable Securities requested to be included which in the opinion of the underwriters can be sold without adversely affecting the marketability of the offering (the "Approved Limit"). Any reduction to the Approved Limit in the number of Registrable Securities included in the registration shall be made pro rata among the requesting holders on the basis of the number of Registrable Securities owned by each holder. -2- 1C. Restrictions. The Company shall not be obligated to effect any request for an Underwritten Registration within 180 days after the effective date of a previous Underwritten Registration or a previous registration in which holders of Registrable Securities were given piggyback rights pursuant to Section 2. Except in the case of the first request for a Demand Registration (if the request is made after August 29, 2002 and if the request is for an Underwritten Registration), the Company may postpone for up to 180 days the filing or the effectiveness of a registration statement for an Underwritten Registration if the Company's board of directors in good faith reasonably determines that the Underwritten Registration would reasonably be expected to have a material adverse effect on any proposal or plan by the Company to engage in any acquisition of assets (other than in the ordinary course of business) or any merger, consolidation, tender offer, reorganization or similar transaction. In this event, the holders of Registrable Securities initially requesting the Underwritten Registration shall be entitled to withdraw their request. If their request is withdrawn, the Underwritten Registration shall not count as one of the Requesting Group's two permitted Demand Registrations, and the Company shall pay all Registration Expenses in connection with the registration. In respect of each Group, the Company may delay an Underwritten Registration pursuant to this Section 1C only once in any 12-month period. 1D. Shelf Registration. In the event of a request for a Shelf Registration, the Company shall promptly prepare and file a shelf registration statement (as amended and supplemented from time to time, the "Shelf Registration Statement") in accordance with Rule 415 under the Securities Act (or any similar rule that may be adopted by the Securities and Exchange Commission), and cause it to be declared effective as soon as reasonably practicable (and in any event within 90 days) after such request and will keep such Shelf Registration Statement continuously effective and in compliance with the Security Act and usable for resale or other disposition of the covered Registrable Securities, subject to clauses (1) and (2) below, for the period (the "Effective Period") commencing on the date on which the Securities and Exchange Commission declares such Shelf Registration Statement effective and ending on the earlier of (x) the first anniversary date of the date such Shelf Registration Statement is declared effective (or, in event the Company has exercised its right under clause (1) below to refuse use of the Shelf Registration for a Delay Period, the eighteen-month anniversary date of the date such Shelf Registration Statement is declared effective) and (y) the first date on which there are no longer any Registrable Securities. The Effective Period shall be automatically extended by the number of days that the second Delay Period, if any, is in effect during the final thirty days of the Effective Period prior to any such extension. In regard to the Shelf Registration Statement: (1) Except in the case of the first request for a Demand Registration (if the request is made after August 29, 2002 and if the request is for a Shelf Registration), the Company shall have the right to refuse use of an effective Shelf Registration Statement (a "Delay Period") for a length of time not to exceed 45 days if the Company's board of directors reasonably determines, with respect to the advisability (as determined in good faith) of deferring public disclosure of material corporate developments, that use of the shelf -3- Registration Statement and the disclosure required to be made therein would not be in the best interests of the Company at such time; provided, however, that there shall not be more than two Delay Periods during the Effective Period. The Company shall use reasonable efforts to minimize the length of any Delay Period and shall provide prompt written notice to the holders of Registrable Securities of the beginning and end of each Delay period. (2) The Company shall promptly notify the holders of Registrable Securities, at any time when a prospectus relating to the sale of the Registrable Securities is required by law to be delivered in connection with sales by an underwriter or dealer, of the occurrence of any 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, in the light of the circumstances under which they were made, not misleading and shall (subject to any Delay Period) promptly make available to holders of Registrable Securities and to the underwriters any such supplement or amendment. Holders of Registrable Securities agree that, upon receipt of any notice from the Company of the occurrence of any event of the kind described in the preceding sentence, holders of Registrable Securities will forthwith discontinue the offer and sale of Registrable Securities pursuant to the Shelf Registration Statement until receipt by holders of Registrable Securities and the underwriters of the copies of such supplemented or amended prospectus. 2. Piggyback Registrations. 2A. Right To Piggyback. Whenever the Company proposes to register any of its securities under the Securities Act (whether or not pursuant to a Demand Registration) and the registration form to be used may be used for the registration of Registrable Securities (a "Piggyback Registration"), the Company shall give prompt written notice to all holders of Registrable Securities of its intention to effect such a registration and shall include in the registration all Registrable Securities with respect to which the Company has received written requests for inclusion within 20 days after receipt of the Company's notice. Holders of Registrable Securities shall be entitled to unlimited Piggyback Registrations for their Registrable Securities. 2B. Piggyback Expenses. The Registration Expenses of the holders of Registrable Securities shall be paid by the Company in all Piggyback Registrations. 2C. Priority on Primary Registrations. If a Piggyback Registration is an underwritten primary registration on behalf of the -4- Company, and the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in the registration exceeds the number that can be sold without adversely affecting the marketability of the offering, the Company shall include in the registration (i) first, the securities that the Company proposes to sell, (ii) second, the Registrable Securities requested to be included in the registration, pro rata among the holders of the Registrable Securities on the basis of the number of Registrable Securities owned by each holder, and (iii) third, any other securities requested to be included in the registration. 2D. Priority on Secondary Registrations. If a Piggyback Registration is an underwritten secondary registration on behalf of holders of the Company's securities, and the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in the registration exceeds the number that can be sold without adversely affecting the marketability of the offering, the Company shall include in the registration (i) first, the Registrable Securities requested to be included in the registration, pro rata among the holders of the Registrable Securities on the basis of the number of Registrable Securities owned by each holder, and (ii) second, the other securities requested to be included in the registration. 2E. Other Registrations. If the Company has previously filed a registration statement with respect to Registrable Securities pursuant to Section 1 or pursuant to this Section 2, and if the previous registration has not been withdrawn or abandoned, the Company shall not file or cause to be effected any other registration of any of its equity securities or securities convertible or exchangeable into or exercisable for its equity securities under the Securities Act (except on Form S-8 or any successor form), whether on its own behalf or at the request of any holder or holders of its securities, until a period of at least 180 days has elapsed from the effective date of the previous registration. 3. Holdback Agreements. 3A. Holders of Registrable Securities. Each holder of Registrable Securities shall not effect any public sale or distribution (including sales pursuant to Rule 144) of equity securities of the Company, or any securities convertible into or exchangeable or exercisable for equity securities of the Company, during the 30 days prior to and the 120-day period (or such lesser period as the managing underwriters may agree to) beginning on the effective date of any Underwritten Registration in which Registrable Shares of the holder's Group are included or any underwritten Piggyback Registration in which Registrable Securities of the holder's Group are included (except as part of such Underwritten Registration or underwritten Piggyback Registration), unless the underwriters managing the offering otherwise agree. -5- 3B. Company. The Company (i) shall not effect any public sale or distribution of its equity securities, or any securities convertible into or exchangeable or exercisable for such securities, during such period prior to and following the effective date of any Underwritten Registration or any underwritten Piggyback Registration as the Company and the underwriters managing the offering may agree. 4. Registration Procedures. Whenever holders of Registrable Securities have requested that any Registrable Securities be registered pursuant to this Agreement, the Company shall use its reasonable best efforts to effect the registration and the sale of the Registrable Securities in accordance with the intended method of disposition, In this regard, the Company shall: (1) prepare and file with the Securities and Exchange Commission a registration statement with respect to such Registrable Securities and use its reasonable best efforts to cause the registration statement to become effective; (2) notify each holder of Registrable Securities of the effectiveness of each registration statement filed under this Agreement and prepare and file with the Securities and Exchange Commission any amendments and supplements to the registration statement and the prospectus that may be necessary to keep the registration statement effective for a period of not less than 180 days (in the case of an Underwritten Registration or an underwritten Piggyback Registration) or for the Effective Period, subject to clauses (1) and (2) of Section 1.D (in the case of a Shelf Registration), and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by the registration statement during the applicable period in accordance with the intended methods of disposition by the sellers described in the registration statement; (3) furnish to each seller of Registrable Securities the number of copies of the registration statement, each amendment and supplement, the prospectus included in the registration statement ( including each preliminary prospectus) and any other documents that each seller may reasonably request in order to facilitate the disposition of the seller's Registrable Securities; (4) use its best efforts to register or qualify the Registrable Securities under such other securities or blue sky laws of such jurisdictions as any seller reasonably requests and do any and all other acts and things which may be reasonably necessary or advisable to enable the seller to consummate the disposition in those jurisdictions of the Registrable Securities owned by the seller (but the Company shall not be required to (i) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph, (ii) subject itself to taxation in any such jurisdiction or (iii) consent to general service of process in any such jurisdiction); -6- (5) notify each seller of Registrable Securities, at any time when a prospectus relating to those securities is required to be delivered under the Securities Act, of the happening of any event as a result of which the prospectus included in the registration statement contains an untrue statement of a material fact or omits any fact necessary to make the statements in the prospectus not misleading; and, at the request of any seller, the Company shall prepare a supplement or amendment to the prospectus so that, when delivered to purchasers of the Registrable Securities, the prospectus, as supplemented or amended, does not contain an untrue statement of a material fact or omit to state any fact necessary to make the statements in the prospectus not misleading; (6) cause all Registrable Securities to be quoted on the Nasdaq National Market System; (7) provide a transfer agent and registrar for all such Registrable Securities not later than the effective date of the registration statement; (8) in the case of an Underwritten Registration, enter into such customary agreements (including underwriting agreements in customary form) and take all other actions that holders of a majority of the Registrable Securities being sold or the underwriters, if any, reasonably request in order to expedite or facilitate the disposition of the Registrable Securities; (9) make available for inspection by any seller of Registrable Securities, any underwriter participating in any disposition pursuant to the registration statement and any attorney, accountant or other agent retained by any seller or underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company's officers, employees and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant or agent in connection with the registration statement; (10) otherwise use its best efforts to comply with all applicable rules and regulations of the Securities and Exchange Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months beginning with the first day of the Company's first full calendar quarter 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; and (11) in the event of the issuance of any stop order suspending the effectiveness of a registration statement, or of any order suspending or preventing the use of any related prospectus or suspending the qualification of any Common Stock included in the registration statement for sale in any jurisdiction, use its best efforts promptly to obtain the withdrawal of such order. -7- 5. Registration Expenses. 5A. Payment by Company. All Registration Expenses shall be borne as provided in this Agreement, except that the Company shall, in any event, pay its internal expenses (including all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit or quarterly review and the expenses and fees for listing the securities to be registered on the Nasdaq National Market System. 5B. Fees of Counsel. In connection with each Demand Registration and each Piggyback Registration, the Company shall reimburse the holders of Registrable Securities included in the registration for the reasonable fees and disbursements of one counsel chosen by the holders of a majority of the Registrable Securities included in the registration and, in the case of an Underwritten Registration or an underwritten Piggyback Registration, for the reasonable fees of one special counsel retained by the holders of Registrable Securities to render any required legal opinions in connection with an underwritten registration which the first counsel is unable or unwilling to render. 5C. Payment by Holders. To the extent that Registration Expenses are not required to be paid by the Company, each holder of securities included in any registration under this Agreement shall pay those Registration Expenses allocable to the registration of the holder's securities so included, and any Registration Expenses not so allocable shall be borne by all sellers of securities included in the registration in proportion to the aggregate selling price of the securities to be so registered. 6. Indemnification. 6A. Indemnification by Company. The Company agrees to indemnify, to the extent permitted by law, each holder of Registrable Securities, its officers and directors and each Person who controls such holder (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and expenses caused by any Violation, except insofar as the Violation is caused by or contained in any information furnished in writing to the Company by the holder expressly for use in a registration statement, prospectus, amendment, supplement or related document or is caused by the holder's failure to deliver a copy of the registration statement or prospectus or any amendment or supplements after the Company has furnished the holder with a sufficient number of copies. In connection with an underwritten offering, the Company shall indemnify such underwriters, their officers and directors and each Person who controls such underwriters (within the meaning of the Securities Act) to the same extent provided in this Section 6(a) with respect to the indemnification of holders of Registrable Securities. -8- 6B. Indemnification by Holder. In connection with any registration statement in which a holder of Registrable Securities is participating, the holder shall furnish to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with the registration statement or prospectus and, to the extent permitted by law, shall indemnify the Company, its directors and officers and each Person who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expenses resulting from any Violation to the extent that the Violation is caused by or contained in any information furnished in writing to the Company by the holder expressly for use in a registration statement, prospectus, amendment, supplement or related document. This obligation to indemnify shall be individual, not joint and several, for each holder and shall be limited to the net amount of proceeds received by the holder from the sale of Registrable Securities pursuant to the registration statement. 6C. Procedures. Any Person entitled to indemnification under this Section 6 shall give prompt written notice to the indemnifying party of any claim with respect to which the Person seeks indemnification (provided that the failure to give prompt notice shall not impair any Person's right to indemnification to the extent that the failure has not prejudiced the indemnifying party). Unless in the indemnified party's reasonable judgment a conflict of interest between the indemnified and indemnifying parties may exist with respect to the claim for indemnification, the indemnified party shall permit the indemnifying party to assume the defense of the claim with counsel reasonably satisfactory to the indemnified party. If the defense of the claim is assumed by the indemnifying party, the indemnifying party shall not be subject to any liability for any settlement made by the indemnified party without its consent (but the indemnifying party shall not unreasonably withhold its consent). An indemnifying party who is not entitled to, or who elects not to, assume the defense of a claim for indemnification shall not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by the indemnifying party with respect to the claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist between the indemnified party and any of the other indemnified parties with respect to the claim. 6D. Survival. The indemnification under this Section 6 shall remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director or controlling Person of the indemnified party and shall survive the transfer of securities. The Company also agrees to make such provisions as are reasonably requested by any indemnified party for contribution to the indemnified party in the event that the Company's indemnification is unavailable for any reason. 7. Participation in Underwritten Registration. No Person may participate in any underwritten registration pursuant to this Agreement -9- unless the Person (i) agrees to sell securities on the basis provided in the underwriting arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents required under the terms of the underwriting arrangements. In any event, however, no holder of Registrable Securities included in any underwritten registration shall be required to make any representations or warranties to the Company or the underwriters (other than representations and warranties regarding the holder and the holder's intended method of distribution) or to undertake any indemnification obligations to the Company or the underwriters except as otherwise provided in Section 6. 8. Miscellaneous. 8A. No Inconsistent Agreements. The Company shall not enter into any agreement with respect to its securities which is inconsistent with or violates the rights granted to the holders of Registrable Securities in this Agreement. Without limiting the generality of the foregoing, until the initial holders of Registrable Securities cease to hold at least 25% of the number of Registrable Securities initially acquired by such holders, the Company shall not grant to any Person the right to request the Company to register any equity securities of the Company, or any securities convertible or exchangeable into or exercisable for such securities, without the prior written consent of the holders of a majority of the Registrable Securities. The Company may grant rights to other Persons to participate in Piggyback Registrations, however, so long as such rights are subordinate to the rights of the holders of Registrable Securities with respect to such Piggyback Registrations as set forth in Sections 2C and 2D of this Agreement. The Company represents and warrants that, except for the Registration Agreement dated October 19, 1994 between the Company and certain of its stockholders, as amended, the Company is not a party to or otherwise subject to any other agreement granting registration rights to any other Person with respect to securities of the Company. 8B. Notices. All Notices under this Agreement shall be in writing and sent by certified or registered mail, overnight messenger service, telecopier or personal delivery, as follows: (a) if to Stericycle, to: Stericycle, Inc. 28161 North Keith Drive Lake Forest, Illinois 60045 Attention: Mr. Mark C. Miller President and Chief Executive Officer Telecopier: (847) 367-9493 with a required copy to: -10- Johnson and Colmar 300 South Wacker Drive Suite 1000 Chicago, Illinois 60606 Attention: Craig P. Colmar, Esq. Telecopier: (312) 922-9283 (b) if to an Investor who is a member of the Bain Group, in care of: Bain Capital Investors, LLC 111 Huntington Avenue Boston, Massachusetts 02199 Attention: Mr. Stephen G. Pagliuca Mr. Robert Gay Mr. John P. Connaughton Mr. Joe Pretlow Telecopier: (617) 516-2010 (c) if to an Investor who is a member of the MDP Group, in care of: Madison Dearborn Partners, LLC Three First National Plaza Suite 3800 Chicago, Illinois 60602 Attention: Mr. Thomas R. Reusche Telecopier: (312) 895-1156 with a required copy, in the case of a Notice to any Investor, to: Kirkland & Ellis 200 East Randolph Drive Chicago, Illinois 60601 Attention: Jeffrey C. Hammes, P.C. Telecopier: (312) 861-2200 All Notices sent by certified or registered mail shall be considered to have been given three business days after being deposited in the mail. All Notices sent by overnight courier service, telecopier or personal delivery shall be considered to have been given when actually received by the intended recipient. A Party may change its address for purposes of this Agreement by Notice in accordance with this Section 8B. 8C. Waiver. The rights and remedies of the Company and holders of Registrable Securities are cumulative and not alternative. Neither the failure nor any delay by the Company or any holder -11- of Registrable Securities in exercising any right, power or privilege under this Agreement shall operate as a waiver of that right, power or privilege, and no single or partial exercise of any right, power or privilege shall preclude any other or further exercise of that right, power or privilege or the exercise of any other right, power or privilege. All waivers shall be in writing signed by the party to be charged with the waiver, and no waiver that may be given by a party shall be applicable except in the specific instance for which it is given. 8D. Amendment. This Agreement may not be amended except by a written agreement signed by the Company and holders of a majority of the Registrable Securities. 8E. Severability. If any provision of this Agreement is held invalid or unenforceable by a court of competent jurisdiction, the other provisions of this Agreement shall remain in full force and effect. Any provision of this Agreement which is held invalid or unenforceable only in part shall remain in full force and effect to the extent not held invalid or unenforceable. 8F. Captions. The captions of sections of this Agreement are for convenience only and shall not affect this the construction or interpretation of this Agreement. 8G. Construction. All references in this Agreement to "Section" or "Sections" refer to the corresponding section or sections of this Agreement. All words used in this Agreement shall be construed to be of the appropriate gender or number as the context requires. Unless otherwise expressly provided, the word "including" does not limit the preceding words or terms. 8H. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be considered an original copy of this Agreement and all of which, when taken together, shall be considered to constitute one and the same agreement. 8I. Governing Law. This Agreement shall be governed by the Laws of the State of Illinois without regard to conflicts of laws principles. 8J. Binding Effect. This Agreement shall apply to, be binding in all respects upon and inure to the benefit of -12- Parties and their respective successors and permitted assigns. -13- In witness, the Parties have executed this Agreement. Company: Stericycle, Inc. By: /s/ Mark C. Miller ------------------------------------------- President and Chief Executive Officer MDP Entities: Madison Dearborn Capital Partners III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ------------------------------------------- A Managing Director Madison Dearborn Special Equity III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ----------------------------------------- A Managing Director Madison Dearborn Capital Partners III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ----------------------------------------- A Managing Director -14- Bain Entities: Bain Capital Fund VI, L.P. By: Bain Capital Partners VI, L.P. Its: General Partner By: Bain Capital Investors, LLC Its: General Partner By: /s/ Paul Edgerly ----------------------------------------- A Managing Director BCIP Associates II By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ----------------------------------------- Name: Title: BCIP Associates II-B By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ----------------------------------------- Name: Title: BCIP Associates II-C By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ----------------------------------------- Name: Title: -15- BCIP Trust Associates II By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------ Name: Title: BCIP Trust Associates II-B By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------ Name: Title: Pep Investments Pty. Limited By: Bain Capital Investors, LLC Its: Attorney-in-Fact By: ------------------------------------------------ Name: Title: Brookside Capital Partners Fund, L.P. By: /s/ Ed Brakeman ------------------------------------------------ Name: Ed Brakeman Title: Managing Director Sankaty High Yield Asset Partners, L.P. By: /s/ Kristin Mugford ------------------------------------------------ Name: Kristin Mugford Title: Managing Director Sankaty High Yield Partners II, L.P. By: /s/ Kristin Mugford ------------------------------------------------ Name: Kristin Mugford Title: Managing Director -16- Schedule A Defined Terms Current Preferred Shares means the shares of Preferred Stock listed under the caption "Preferred Shares" on the attached Schedule I. Exchange Act means the Securities Exchange Act of 1934, as amended. Group means either: (a) the group (the "Bain Group") consisting of (1) the Investors listed under the caption "Bain Entities" on the attached Schedule I (for as long as each such Investor continues to be the beneficial owner of Registrable Securities), and (2) the Permitted Transferees of such Investors (for as long as each such Permitted Transferee continues to be the beneficial owner of Registrable Securities); or (b) the group (the "MDP Group") consisting of (1) the Investors listed under the caption "MDP Entities" on the attached Schedule I (for as long as each such Investor continues to be the beneficial owner of Registrable Securities), and (2) the Permitted Transferees of such Investors (for as long as each such Permitted Transferee continues to be the beneficial owner of Registrable Securities). Person means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization, or other entity. Permitted Transferee is defined in the Corporate Governance Agreement (as amended and restated pursuant to the Waiver Agreement). Registrable Securities means (i) any shares of Common Stock issued or issuable upon conversion of the Current Preferred Shares and (ii) any shares of Common Stock issued or issuable (A) as a dividend or distribution in respect of, or (B) in exchange for or replacement of, or (C) upon conversion or exercise of any warrant or other security issued or issuable as a dividend or distribution in respect of or in exchange for or replacement of, the Current Preferred Shares and any shares of Common Stock issued or issuable upon conversion of the Current -17- Preferred Shares. Any Registrable Securities shall cease to be Registrable Securities if and when they (or, in respect of issuable but not yet issued Registrable Securities, the underlying Preferred Stock or Common Stock) cease to be beneficially owned by a member of a Group. Registration Expenses means all expenses incident to the Company's performance of or compliance with this Agreement, including all registration and filing fees, fees and expenses of compliance with securities or blue sky laws, printing expenses, messenger and delivery expenses, fees and disbursements of custodians, and fees and disbursements of counsel for the Company and all independent certified public accountants, underwriters (excluding discounts, commissions and underwriters' counsel fees) and other Persons retained by the Company. Securities Act means the Securities Act of 1933, as amended. Violation means any of the following statements, omissions or violations: (i) any untrue statement or alleged untrue statement of a material fact contained in a registration statement under this Agreement, including any related preliminary or final prospectus, any amendment or supplement, or any document filed under state securities or "blue sky" laws, (ii) the omission or alleged omission to state a material fact required to be stated in any such registration statement, prospectus, amendment, supplement or document or necessary to make the statements in any such registration statement, prospectus, amendment, supplement or document not misleading, or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any state securities law, or any rule or regulation promulgated under the Securities Act, the Exchange Act or any state securities law. -18- Schedule I Preferred Shares
Preferred Shares MDP Entities Madison Dearborn Capital Partners III, L.P..................... 22,267.55 Madison Dearborn Special Equity III, L.P....................... 494.44 Special Advisors Fund I, LLC................................... 91.42 --------- Total........................................................ 22,853.41 Bain Entities Bain Capital Fund VI, L.P...................................... 15,437.45 BCIP Associates II............................................. 2,732.19 BCIP Associates II-B........................................... 374.57 BCIP Associates II-C........................................... 802.00 BCIP Trust Associates.......................................... 781.81 BCIP Trust Associates II-B..................................... 124.77 PEP Investments Pty. Limited................................... 51.45 Brookside Capital Partners Fund L.P............................ 1,123.92 Sankaty High Yield Asset Partners, L.P......................... 561.96 Sankaty High Yield Partners II, L.P............................ 561.96 --------- Total........................................................ 22,552.07 Grand Total....................................................... 45,405.47 =========
-19- EX-10.1 4 dex101.txt AMENDMENT 1 TO AMENDED & RESTATED CREDIT AGMT Exhibit 10.1 Amendment No. 1 To Amended and Restated Credit Agreement This Amendment No. 1 To Amended and Restated Credit Agreement (the "Agreement") is being executed and delivered as of June 28, 2002 by and among Stericycle, Inc., a Delaware corporation (the "Borrower"), each of the Subsidiary Guarantors named as signatories hereto, the financial institutions from time to time party to the Credit Agreement referred to and defined below (collectively, the "Lenders") and Bank of America, N.A., as representative of the Lenders (in such capacity, the "Administrative Agent"). Undefined capitalized terms used herein shall have the meanings ascribed to such terms in such Credit Agreement as defined below. W I T N E S S E T H: WHEREAS, the Borrower, the Lenders, the Administrative Agent, Credit Suisse First Boston, as the Co-Syndication Agent, UBS Warburg, LLC, as the Co-Syndication Agent, and Fleet National Bank, as the Documentation Agent, have entered into that certain Amended and Restated Credit Agreement dated as of October 5, 2001 (the "Credit Agreement"), pursuant to which, among other things, the Lenders have agreed to provide, subject to the terms and conditions contained therein, certain loans to the Borrower; WHEREAS, in connection with the Credit Agreement, (i) the Borrower has executed and delivered a certain Security and Pledge Agreement and other Loan Documents pursuant to which it has granted liens and security interests in substantially all of its properties as security for its obligations with respect to the Credit Agreement and (ii) the Subsidiary Guarantors have each executed and delivered in favor of the Administrative Agent and the Lenders, a certain Subsidiary Guaranty, Security and Pledge Agreement and certain other Loan Documents pursuant to which the Subsidiary Guarantors have guaranteed the Borrower's obligations under the Credit Agreement and the Subsidiary Guarantors have granted liens and security interests in substantially all of their properties as security for obligations with respect to the Credit Agreement; WHEREAS, to facilitate Borrower's desire to effect certain redemptions or repurchases with respect to its outstanding Capital Stock, the Borrower has requested that the Lenders, and subject to the terms and conditions set forth herein, the Lenders have agreed to amend the Credit Agreement to, among other things, (i) increase the aggregate Revolving Loan Commitment Amount from $80,000,000 to $105,000,000 and (ii) modify the covenants which restrict the amount of Restricted Payments the Borrower may make in connection with the repurchase or redemption of its Capital Stock and the redemption of its Subordinated Notes; and WHEREAS, in anticipation of effecting the increase in the Revolving Loan Commitment Amount and the addition of a new Lender, (i) the Revolving Loan Lenders have agreed to sell and assign certain portions of their outstanding Revolving Loans under the Credit Agreement to certain of the Lenders, and (ii) the Revolving Loan Lenders hereunder have agreed to reallocate their respective Commitments and interests in the existing Revolving Loans under the Credit Agreement; NOW, THEREFORE, in consideration of the foregoing premises, the terms and conditions stated herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the Borrower, the Subsidiary Guarantors, the Lenders and the Administrative Agent, such parties hereby agree as follows: 1. Amendment. Subject to the satisfaction of each of the conditions set forth in Paragraph 2 of this Agreement, the Credit Agreement is hereby amended as follows (unless otherwise specified, section and schedule references used herein shall mean and refer to sections and schedules of the Credit Agreement): (a) Section 1.1 is amended to: (i) insert in appropriate alphabetical order the following definitions: " `Amendment No. 1' means that certain Amendment No. 1 to Amended and Restated Credit Agreement dated June 28, 2002 among the Borrower, the Subsidiary Guarantors signatories thereto, the Lenders and the Administrative Agent." " `Amendment No. 1 Effective Date' means the date on which the Administrative Agent has received each of items set forth in Paragraph 2 of Amendment No. 1." " `Amendment No. 1 Purchasing Lender' means each financial institution designated as a `Purchasing Lender' on Schedule IV attached hereto." " `Resulting Lender' means each Lender having a Revolving Loan Commitment immediately after the Amendment No. 1 Effective Date." " `Amendment No. 1 Selling Lender' means each financial institution designated as a `Selling Lender' on Schedule IV attached hereto." (ii) delete in its entirety the definition of "Revolving Loan Commitment" and to replace such definition with the following definition: " `Revolving Loan Commitment' means, relative to any Lender, such Lender's obligation, if any, to (i) purchase outstanding `Loans' under and as -2- defined in the Original Credit Agreement and designated to be converted into or continued as Revolving Loans hereunder pursuant to the Master Assignment Agreement, its agreement hereunder to amend and restate the terms governing such `Loans', (ii) to purchase `Loans' pursuant to the terms of Section 10.11.3 and (iii) its obligation to make Revolving Loans pursuant to clause (a) of Section 2.1.1." (iii) delete from the definition of "Revolving Loan Commitment Amount" the dollar amount "$80,000,000" in the first line thereof and to replace such dollar amount with "$105,000,000". (iv) delete from the definition of "RL Percentage" the clause "below its signature on the signature pages hereto" in the second line thereof and to replace such clause with the clause "on Schedule III hereto". (b) Section 7.2.4 is amended to delete subsection (c) in its entirety and to replace such subsection (c) with the following: "(c) The Borrower will not permit Net Worth, at any time after the Effective Date, to be less than the sum of (i) $245,000,000 plus, (ii) 50% of the sum of Net Income for each Fiscal Quarter ending during the period April 1, 2002 through the last day of the then most recently ended Fiscal Quarter after the Effective Date with respect to which the Borrower shall have delivered, or is obligated to then deliver, quarterly financial statements and a Compliance Certificate pursuant to Section 7.1.1, excluding from such sum, however, any such Fiscal Quarter's Net Income which is negative, plus, (iii) 50% of the aggregate amount of Net Equity Proceeds received by the Borrower after the Effective Date, minus (iv) the aggregate consideration paid by the Borrower after the Amendment No. 1 Effective Date for the repurchase, redemption or retirement of its Capital Stock pursuant to Section 7.2.6(a) or Section 7.2.6(c), but only to the extent such aggregate amount is less than or equal to $50,000,000." (c) Section 7.2.6 is amended to delete subsection (b) in its entirety and to replace such subsection (b) with the following: "(b) redeem, defease or otherwise prepay or retire the Subordinated Notes, including, without limitation, pursuant to a Qualified Subordinated Note Redemption, provided, that, except in the case of a Qualified Subordinated Note Redemption completed prior to the Amendment No. 1 Effective Date: (1) immediately after giving effect to such redemption, defeasance, prepayment or retirement, the Leverage Ratio shall be less than or equal to 2.50:1.00 and the Senior Leverage Ratio shall be less than or equal to 2.00:1.00, in each case calculated based upon the Leverage Ratio and Senior Leverage Ratio set forth in the Compliance Certificate then most recently -3- delivered by the Borrower to the Administrative Agent pursuant to Section 7.1.1(c); or (2) (A) such redemption, defeasance, prepayment or retirement is made after the Amendment No. 1 Effective Date, but prior to December 31, 2002, and (B) immediately after giving effect to such redemption, defeasance, prepayment or retirement, the Leverage Ratio shall be less than or equal to 3.25:1.00 and the Senior Leverage Ratio shall be less than or equal to 2.75:1.00, in each case calculated based upon the Leverage Ratio and Senior Leverage Ratio set forth in the Compliance Certificate then most recently delivered by the Borrower to the Administrative Agent pursuant to Section 7.1.1(c) and (C) the total aggregate amount of such Restricted Payments made after the Amendment No. 1 Effective Date pursuant to this clause (b), shall not exceed 10% of Net Worth at the time of such redemption, defeasance, prepayment or retirement, immediately after giving effect to such redemption, defeasance, prepayment or retirement; or (3) (A) such redemption, defeasance, prepayment or retirement is made on or after January 1, 2003 and (B) immediately after giving effect to such redemption, defeasance, prepayment or retirement, the Leverage Ratio shall be less than or equal to 3.00:1.00 and the Senior Leverage Ratio shall be less than or equal to 2.50:1.00, in each case calculated based upon the Leverage Ratio and Senior Leverage Ratio set forth in the Compliance Certificate then most recently delivered by the Borrower to the Administrative Agent pursuant to Section 7.1.1(c) and (C) the total aggregate amount of Restricted Payments made after the Amendment No. 1 Effective Date pursuant to this clause (b) and pursuant to clause (c) of this section, does not exceed the difference of (i) 10% of Net Worth at the time of such redemption, defeasance, prepayment or retirement, immediately after giving effect to such redemption, defeasance, prepayment or retirement, minus (ii) the aggregate consideration paid by the Borrower after the Amendment No. 1 Effective Date for the repurchase, retirement or redemption of its Capital Stock pursuant to Section 7.2.6(a) and Section 7.2.6(c), but only to the extent such aggregate consideration exceeds $65,000,000;" (d) Section 7.2.6 is further amended to delete subsection (c) in its entirety and to replace such subsection (c) with the following: "(c) declare, pay and make Restricted Payments consisting of dividends, repurchases or redemptions with respect to the Borrower's Capital Stock, in addition to those permitted by the foregoing clause (a) of this section, provided, that, (1) immediately after giving effect to any such Restricted Payments, the Leverage Ratio shall be less than or equal to 2.50:1.00, calculated based -4- upon the Leverage Ratio set forth in the Compliance Certificate then most recently delivered by the Borrower to the Administrative Agent pursuant to Section 7.1.1(c); or (2) (A) immediately after giving effect to such Restricted Payments, the Leverage Ratio shall be less than or equal to 3.25:1.00, calculated based upon the Leverage Ratio set forth in the Compliance Certificate then most recently delivered by the Borrower to the Administrative Agent pursuant to Section 7.1.1(c) and (B) the total aggregate amount of such Restricted Payments made after the Amendment No. 1 Effective Date pursuant to this clause (c)(2) after giving effect to such Restricted Payments shall not exceed $65,000,000, provided, further, however, that notwithstanding anything to the contrary in this clause (c), any Restricted Payments which are permitted by this clause (c)(2) and which are also permitted by either clause (c)(1) or clause (c)(3) shall be deemed to have been made pursuant to this clause (c)(2) (and not pursuant to clause (c)(1) or clause (c)(3), as the case may be) until such time as such Restricted Payments made pursuant to this clause (c)(2) equal $65,000,000; or (3) (A) such Restricted Payments are made on or after January 1, 2003 and (B) immediately after giving effect to such Restricted Payments, the Leverage Ratio shall be less than or equal to 3.00:1.00, calculated based upon the Leverage Ratio set forth in the Compliance Certificate then most recently delivered by the Borrower to the Administrative Agent pursuant to Section 7.1.1(c) and (C) the total aggregate amount of such Restricted Payments made after the Amendment No. 1 Effective Date pursuant to this clause (c)(3) and clause (c)(1) of this section and pursuant to clause (b) of this section (but not including Restricted Payments made after the Amendment No. 1 Effective Date pursuant to clause (c)(2) of this section) shall not exceed 10% of Net Worth at the time of the making of such Restricted Payments immediately after giving effect to such Restricted Payments;" (e) Section 10.11 is amended to insert the following Section 10.11.3 thereto immediately following Section 10.11.2: "SECTION 10.11.3 2002 Assignments. (a) As of the Amendment No. 1 Effective Date, each of the Amendment No. 1 Selling Lenders hereby sells and assigns to the each of the Amendment No. 1 Purchasing Lenders, and each of the Amendment No. 1 Purchasing Lenders hereby purchases and assumes from each of the Amendment No. 1 Selling Lenders, certain of each Amendment No. 1 Selling Lender's interests in the Revolving Loans and participation interests in the Letter of Credit Outstandings (collectively, the `Interests'), and each of the Resulting Lenders hereby agrees to reallocate among such Resulting Lenders their respective Commitments and interests in the -5- outstanding Revolving Loans and Letter of Credit Outstandings, in each case such that after giving effect to such sales, assignments, purchases, assumptions and reallocations, each Resulting Lender shall have the resulting Interests as are set forth on Schedule IV beside its name therein under the heading `6/28/02 Revolver Reallocated Outstandings'. The sales, assignments, purchases, assumptions and reallocations to be effected pursuant to this paragraph shall be without recourse to, or representation or warranty (except as expressly provided in this Section 10.11.3) by, any of the Resulting Lenders. (b) Each of the Amendment No. 1 Selling Lenders (i) represents and warrants that it is the legal and beneficial owner of the Interests and Commitments, if any, being sold and assigned by it hereunder and that such Interests are free and clear of any adverse claim; (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made by the Borrower in or in connection with the Credit Agreement or Amendment No. 1; and (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower or its Affiliates or the performance or observance by the Borrower or its Affiliates of any of their respective obligations under the Credit Agreement or any other instrument or document furnished pursuant thereto. (c) Each of the Amendment No. 1 Selling Lenders will deliver to the Administrative Agent each existing Note evidencing any portion of such Amendment No. 1 Selling Lender's interests in the outstanding Revolving Loans and Letter of Credit Outstandings owed by the Borrower to such Amendment No. 1 Selling Lender prior to giving effect to the sales and assignments being effected hereby (the `Old Notes'). Upon receipt by the Administrative Agent from each Amendment No. 1 Selling Lender of its Old Notes, and receipt from the Borrower of the substituted and amended notes payable to the Resulting Lenders and to be delivered by the Borrower pursuant to Amendment No. 1 (the `New Notes'), the Administrative Agent will return the Old Notes to the Borrower marked `substituted and amended' and deliver the New Notes to each applicable Resulting Lender. (d) The effective date of the sales, assignments, purchases, assumptions and reallocations to be effected by this Section 10.11.3 shall be the date on which all of the conditions to effectiveness of the Amendment No. 1 shall have been satisfied. (e) As of the Amendment No. 1 Effective Date, (i) the Amendment No. 1 Purchasing Lenders shall be a party to the Credit Agreement, as amended pursuant to Amended No. 1, and, to the extent provided in this Section 10.11.3, shall have the rights and obligations of a `Lender' thereunder, and (ii) each of the Amendment No. 1 Selling Lenders shall, to the extent provided in this Section 10.11.3, relinquish its respective rights and be released from its obligations under the Credit Agreement, as amended by Amendment No. 1. -6- (f) From and after the Amendment No. 1 Effective Date, the Administrative Agent shall make all payments under the Credit Agreement in respect of the Interests assigned hereby (including all payments of principal, interest and fees with respect thereto) to the Resulting Lenders. (g) All interest and fees under the Credit Agreement which are accrued and unpaid through the Amendment No. 1 Effective Date with respect to the Interests assigned and Commitments reallocated hereby shall be for the account of the Amendment No. 1 Selling Lenders and, upon the Administrative Agent's receipt from the Borrower of payment of such interest and fees, the Administrative Agent shall allocate such payments among the Amendment No. 1 Selling Lenders and the Amendment No. 1 Purchasing Lenders accordingly." (f) The Credit Agreement is amended to attach thereto the Schedule III and Schedule IV attached hereto as Exhibit A and Exhibit B, respectively. 2. Effectiveness of this Agreement; Conditions Precedent. The provisions of Paragraph 1 of this Agreement shall be deemed to have become effective as of the date of this Agreement, but such effectiveness shall be expressly conditioned upon the Administrative Agent's receipt of each of the following: (a) an originally-executed counterpart of this Agreement executed and delivered by duly authorized officers of the Borrower, the Subsidiary Guarantors and the Required Lenders; (b) restated and amended Revolving Notes made payable to each Revolving Loan Lender with respect to each of their Revolving Loan Commitments, as proposed to be amended hereby and in form and substance acceptable to the Administrative Agent; (c) certificates of the secretary or assistant secretary of the Borrower certifying (i) the currency and authenticity of the resolutions of the board of directors of the Borrower authorizing its execution and delivery of this Agreement and the performance hereof and of the Credit Agreement as to be amended hereby, (ii) the incumbency of the officers of the Borrower and (iii) the currency and authenticity of the Organic Documents of the Borrower; (d) a good standing certificate for the Borrower from the State of Delaware, as of a date no earlier than 30 days prior to the date each of the other conditions of this paragraph shall have been satisfied; (e) a certificate signed by an officer, dated as of the date each of the other conditions set forth in this paragraph shall have been satisfied, stating that, after giving effect to the amendments contemplated by this Agreement: (i) the representations and warranties contained in Article VI of the Credit Agreement (other than representations -7- and warranties which, in accordance with their express terms, are made only as of an earlier specified date) are true and correct in all material respects as of date and (ii) no Default or Event of Default exists or would result therefrom; (f) payment in full, in immediately available funds by the Borrower of the amounts described in Section 10.11.3(g) of the Credit Agreement, as amended by this Agreement; (g) a legal opinion from Johnson & Colmar, special counsel to the Obligors, addressed to the Administrative Agent and the Lenders, in form and substance acceptable to the Administrative Agent; and (h) payment in full, in immediately available funds, of (i) the fee payable to each Lender who is increasing its Revolving Loan Commitment as set forth in separate agreements among the each such Lender, the Administrative Agent and the Borrower and (ii) the arrangement fee payable to the Administrative Agent as set forth in a separate agreement between the Administrative Agent and the Borrower. 3. Representations, Warranties and Covenants. (a) The Borrower hereby represents and warrants that this Agreement and the Credit Agreement as amended by this Agreement constitute the legal, valid and binding obligations of the Borrower enforceable against the Borrower in accordance with their terms. (b) The Borrower hereby represents and warrants that its execution, delivery and performance of this Agreement and the Credit Agreement as amended by this Agreement have been duly authorized by all proper corporate action, do not violate any provision of its certificate of incorporation or bylaws, will not violate any law, regulation, court order or writ applicable to it, and will not require the approval or consent of any governmental agency, or of any other third party under the terms of any contract or agreement to which the Borrower or any of the Borrower's Affiliates is bound, including, without limitation, the Subordinated Debt Documents. (c) The Borrower hereby represents and warrants that, after giving effect to the provisions of this Agreement, (i) no Default or Event of Default has occurred and is continuing or will have occurred and be continuing and (ii) all of the representations and warranties of the Borrower contained in the Credit Agreement and in each other Loan Document (other than representations and warranties which, in accordance with their express terms, are made only as of an earlier specified date) are, and will be, true and correct as of the date of the Borrower's execution and delivery hereof or thereof in all material respects as though made on and as of such date. -8- 4. Reaffirmation, Ratification and Acknowledgment; Reservation. The Borrower and each Subsidiary Guarantor hereby (a) ratifies and reaffirms all of its payment and performance obligations, contingent or otherwise, and each grant of security interests and liens in favor of the Administrative Agent, under each Loan Document to which it is a party, (b) agrees and acknowledges that such ratification and reaffirmation is not a condition to the continued effectiveness of such Loan Documents, and (c) agrees that neither such ratification and reaffirmation, nor the Administrative Agent's, or any Lender's solicitation of such ratification and reaffirmation, constitutes a course of dealing giving rise to any obligation or condition requiring a similar or any other ratification or reaffirmation from the Borrower or such Subsidiary Guarantors with respect to any subsequent modifications to the Credit Agreement or the other Loan Documents. The Credit Agreement is in all respects ratified and confirmed. Each of the Loan Documents shall remain in full force and effect and are hereby ratified and confirmed. Neither the execution, delivery nor effectiveness of this Agreement shall operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, or of any Default or Event of Default (whether or not known to the Administrative Agent or the Lenders), under any of the Loan Documents, all of which rights, powers and remedies, with respect to any such Default or Event of Default or otherwise, are hereby expressly reserved by the Administrative Agent and the Lenders. This Agreement shall constitute a Loan Document for purposes of the Credit Agreement. 5. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). 6. Administrative Agent's Expenses. The Borrower hereby agrees to promptly reimburse the Administrative Agent for all of the reasonable out-of-pocket expenses, including, without limitation, attorneys' and paralegals' fees, it has heretofore or hereafter incurred or incurs in connection with the preparation, negotiation and execution of this Agreement, the 2002 Master Lender Assignment Agreement and the other related Loan Documents. 7. Counterparts. This Agreement may be executed in counterparts, each of which shall be an original and all of which together shall constitute one and the same agreement among the parties. * * * * -9- IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year first above written. Stericycle, Inc., as Borrower By: /s/ Frank J.M. ten Brink ------------------------------------------ Title: Frank ten Brink Vice President Stericycle of Arkansas, Inc., an Arkansas corporation Stericycle of Washington, Inc., a Washington corporation SWD Acquisition Corp., a Delaware corporation Environmental Control Co., Inc., a New York corporation, Waste Systems, Inc., a Delaware corporation Med-Tech Environmental, Inc., a Delaware corporation Med-Tech Environmental (MA), Inc., a Delaware corporation, Ionization Research Co., Inc., a California corporation, Browning-Ferris Industries of Connecticut, Inc., a Delaware corporation BFI Medical Waste, Inc., a Delaware corporation, American Medical Disposal, Inc., an Oklahoma corporation, Environmental Health Systems, Inc., a Nebraska corporation Stroud Properties, Inc., a Delaware corporation, each as a Subsidiary Guarantor By: /s/ Frank J.M. ten Brink ------------------------------------------ Title: Frank ten Brink Vice President Allied Irish Banks PLC By: /s/ Rima Terradista ---------------------------------------- Rima Terrdista Senior Vice President By: /s/ John Farrace ---------------------------------------- John Farrace Senior Vice President American National Bank and Trust Company of Chicago By: [signature illegible] ---------------------------------------- Title: VP Bank of America, N.A., as Administrative Agent By: /s/ Kristine Thennes ---------------------------------------- Title: Bank of America, N.A., as a Lender By: /s/ Jennifer Gerdes ---------------------------------------- Title: Vice President Fleet National Bank By: /s/ Brian F.X. Gephardt ---------------------------------------- Title: Managing Director Comerica Bank By: /s/ Felicia M. Maxwell ---------------------------------------- Title: Felicia M. Maxwell Assistant Vice President Credit Suisse First Boston By: /s/ Kristin Lepri/Jay Chall ---------------------------------------- Title: Kristin Lepri, Associate Jay Chall, Director Credit Lyonnais New York Branch By: [signature illegible] ---------------------------------------- Title: Harris Trust & Savings Bank By: [signature illegible] ---------------------------------------- Title: Vice President LaSalle Bank National Association By: /s/ Brian Peterson ---------------------------------------- Brian Peterson First Vice President ELT Ltd By: /s/ Kelly W. Warnement ---------------------------------------- Title: Kelly W. Warnement Authorized Agent KZH Riverside LLC By: /s/ Anthony Iarrobino ---------------------------------------- Title: Anthony Iarrobino Authorized Agent KZH Soleil-2 LLC By: /s/ Anthony Iarrobino ---------------------------------------- Title: Anthony Iarrobino Authorized Agent Muirfield Trading LLC By: /s/ Kelly W. Warnement ---------------------------------------- Title: Kelly W. Warnement Vice President Eaton Vance CDO III, Ltd. By: Eaton Vance Management as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President Eaton Vance CDO IV, Ltd. By: Eaton Vance Management as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President Eaton Vance Senior Income Trust By: Eaton Vance Management as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President Eaton Vance Instiutional Senior Loan Fund By: Eaton Vance Management as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President Costantinus Eaton Vance CDO V, Ltd. By: Eaton Vance Management as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President Grayson & Co. By: Boston Management and Research as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President Sankaty Advisors, LLC as Collateral Manager for Great Point CLO 1999-1 LTD., as Term Lender By: /s/ Diane J. Exeter ---------------------------------------- Name: Diane J. Exeter Title: Managing Director Portfolio Manager Harbour Town Funding LLC By: /s/ Kelly W. Warnement ---------------------------------------- Title: Kelly W. Warnement Vice President The Northern Trust Company By: /s/ Eileen L. Sachanda ---------------------------------------- Title: Vice President Olympic Funding Trust, Series 1999-I By: /s/ Kelly W. Warnement ---------------------------------------- Title: Kelly W. Warnement Authorized Agent Oxford Strategic Income Fund By: Eaton Vance Management as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President PPM Spyglass Funding Trust By: /s/ Kelly W. Warnement ---------------------------------------- Title: Kelly W. Warnement Authorized Agent PPM Shadow Creek Funding LLC By: /s/ Kelly W. Warnement ---------------------------------------- Title: Kelly W. Warnement Vice President Sankaty Advisors, LLC as Collateral Manager for Race Point CLO Limited, as Term Lender By: /s/ Diane J. Exeter ---------------------------------------- Name: Diane J. Exeter Title: Managing Director Portfolio Manager Sankaty High Yield Partners III, L.P. By: /s/ Diane J. Exeter ---------------------------------------- Name: Diane J. Exeter Title: Managing Director Portfolio Manager Scudder Floating Rate Fund By: /s/ Kenneth Weber ---------------------------------------- Title: Sr. Vice President Sequils-Cumberland I, Ltd. By: Deerfield Capital management LLC as Its Collateral Manager By: /s/ [signature illegible] ---------------------------------------- Title: VP Toronto Dominion (New York) By: /s/ Susan K. Strong ---------------------------------------- Title: Susan K. Strong, Vice President UBS AG, Stamford Branch By: /s/ Patricia O. Kickl ---------------------------------------- Title: Patricia O. Kickl Director Banking Product Services By: /s/ Wilfred V. Saint ---------------------------------------- Title: Wilfred V. Saint Associate Director Banking Product Services, US Van Kampen Senior Floating Rate Fund By: Van Kampen Investment Advisory Corp. By: /s/ Darwin D. Pierce ---------------------------------------- Title: Darwin D. Pierce Executive Director Van Kampen Senior Income Trust By: Van Kampen Investment Advisory Corp. By: /s/ Darwin D. Pierce ---------------------------------------- Title: Darwin D. Pierce Executive Director Van Kampen CLO I, Limited By: Van Kampen Investment Advisory Corp. as Collateral Manager By: /s/ Darwin D. Pierce ---------------------------------------- Title: Darwin D. Pierce Executive Director Van Kampen CLO II, Limited By: Van Kampen Investment Advisory Corp. as Collateral Manager By: /s/ Darwin D. Pierce ---------------------------------------- Title: Darwin D. Pierce Executive Director Senior Debt Portfolio By: Boston Management and Research as Investment Advisor By: /s/ Payton F. Swaffield ---------------------------------------- Title: Peyton F. Swaffield Vice President EXHIBIT A TO AMENDMENT NO. 1 TO AMENDED AND RESTATED CREDIT AGREEMENT SCHEDULE III
Revolver 6/28/02 Revolver Participant Name Commitment Percentage Reallocated Percentage - ---------------- ---------- ---------- ----------- ---------- Commitment ---------- Allied Irish Bank 4,444,444.44 5.55555556% 4,444,444.44 4.232804229% American National 8,888,888.89 11.11111111% 8,888,888.89 8.465608467% Bank of America, NA 12,444,444.44 15.55555556% 14,944,444.44 14.232804229% Comerica Bank 3,111,111.11 3.88888889% 7,611,111.11 7.248677248% Credit Suisse First Boston 11,111,111.11 13.88888889% 11,111,111.11 10.582010581% Fleet National Bank 11,111,111.11 13.88888889% 13,111,111.11 12.486772486% Harris Trust & Savings Bank 8,888,888.89 11.11111111% 10,388,888.89 9.894179895% LaSalle Bank National Association 8,888,888.89 11.11111111% 8,888,888.89 8.465608467% The Northern Trust Company 4,444,444.45 5.55555555% 5,444,444.45 5.185185190% UBS AG, Stamford Branch 6,666,666.67 8.33333333% 6,666,666.67 6.349206352% Credit Lyonnais New York Branch 0.00 0.00000000% 13,500,000.00 12.857142857% -------------------------------------------------------------------- 80,000,000.00 100.00000000% 105,000,000.00 100.00000000%
EXHIBIT B TO AMENDMENT NO. 1 TO AMENDED AND RESTATED CREDIT AGREEMENT SCHEDULE IV
Revolver Outstandings 6/28/02 Revolver Participant Name (currently Percentage Reallocated Outstandings Percentage - ---------------- ---------- ---------- ------------------------ ---------- LC's only) ---------- Allied Irish Bank 109,024.11 5.55555556% 83,065.99 4.232804229% American National 218,048.23 11.11111111% 166,131.98 8.465608467% Bank of America, NA 305,267.52 15.55555556% 279,309.40 14.232804229% Comerica Bank 76,316.88 3.88888889% 142,250.51 7.248677248% Credit Suisse First Boston 272,560.28 13.88888889% 207,664.98 10.582010581% Fleet National Bank 272,560.28 13.88888889% 245,044.68 12.486772486% Harris Trust & Savings Bank 218,048.23 11.11111111% 194,166.76 9.894179895% LaSalle Bank National Association 218,048.23 11.11111111% 166,131.98 8.465608467% The Northern Trust Company 109,024.11 5.55555555% 101,755.84 5.185185190% UBS AG, Stamford Branch 163,536.17 8.33333333% 124,598.99 6.349206352% Credit Lyonnais New York Branch** 0.00 0.00000000% 252,312.95 12.857142857% ------------------------------------------------------------------------- 1,962,434.05 100.00000000% 1,962,434.05 100.00000000%
**This participant is a Purchasing Lender. EX-10.2 5 dex102.txt AMENDMENT & WAIVER AGREEMENT Exhibit 10.2 Amendment and Waiver Agreement This Amendment and Waiver Agreement (this "Agreement"), dated as of July 26, 2002, is by and among Stericycle, Inc., a Delaware corporation ("Company"), and the Persons whose names are set forth on the attached Schedule I (collectively, the "Investors"). RECITALS: WHEREAS, each of the Investors holds shares of the Company's Series A Convertible Preferred Stock, par value $0.01 per share (the "Preferred Shares"), acquired pursuant to that certain Amended and Restated Series A Convertible Preferred Stock Purchase Agreement, dated September 26, 1999 (the "Purchase Agreement"); WHEREAS, the Company and the Investors are the parties currently bound by that certain Registration Rights Agreement, dated as of November 12, 1999 (the "1999 Registration Rights Agreement"), which was entered into at the closing of the transactions contemplated by the Purchase Agreement; WHEREAS, the Company and the Investors are the parties currently bound by that certain Corporate Governance Agreement, dated as of November 12, 1999 (the "1999 Corporate Governance Agreement"), which was entered into at the closing of the transactions contemplated by the Purchase Agreement; WHEREAS, the powers, designations, preferences and relative, participating, optional and other rights, and qualifications, limitations and restrictions applicable to the Preferred Shares are set forth in that certain Certificate of Designation of the Company filed with the Office of the Secretary of State of the State of Delaware on November 4, 1999 (the"1999 Certificate of Designation"); WHEREAS, the Purchase Agreement, the 1999 Registration Rights Agreement, the 1999 Corporate Governance and the 1999 Certificate of Designation are referred to herein collectively as "1999 Investment Documents"; WHEREAS, the Company and the Investors find it mutually desirable, and are willing, to amend the 1999 Investment Documents, subject to the terms and conditions of this Agreement; and WHEREAS, terms used and not otherwise defined herein shall have the respective meanings ascribed to such terms in the Purchase Agreement; NOW, THEREFORE, in consideration of the foregoing and the agreements, promises and covenants set forth below, and for other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: Section 1. Waiver of Certain Prospective Dividends; Amendment to 1999 Certificate of Designation. (a) Filing of First Amendment to Certificate of Designation. The Investors hereby consent to, and the Company agrees to cause (promptly after approval by the Company's stockholders in accordance with (S) 242 of the Delaware General Corporation Law), the filing of an amendment to the Company's Certificate of Designation in the form of Exhibit A attached hereto (the "First Amendment to Certificate of Designation") with the Office of the Secretary of State of the State of Delaware for the purpose of waiving any further right to accrual of dividends from and after June 1, 2002 on any outstanding Preferred Shares, except for the revival (if any) of such accrual of dividends as may occur in accordance with the terms and conditions of the First Amendment to Certificate of Designation (in the form attached hereto). The Investors acknowledge that the Company may not obtain stockholder approval of the First Amendment to Certificate of Designation until the Company's 2003 annual meeting of stockholders. The Company and the Investors (for themselves and their Permitted Transferees, as defined in the Restated Corporate Governance Agreement) agree that pending stockholder approval and filing of the First Amendment to Certificate of Designation, the Company and the Investors shall proceed vis-a-vis one another as if the First Amendment to Certificate of Designation had been approved by the Company's stockholders and filed with the Office of the Secretary of State of Delaware. The Investors agree to vote in favor of the First Amendment to Certificate of Designation at any regular or special meeting of the Company's stockholders at which the First Amendment to Certificate of Designation is submitted for stockholder approval. (b) Limited Waiver of Prospective Dividends. The Investors hereby waive any further right to accrual of dividends from and after June 1, 2002 on any outstanding Preferred Shares, except for the revival (if any) of such accrual of dividends as may occur in accordance with the terms and conditions of the First Amendment to Certificate of Designation (in the form attached hereto). The foregoing waiver is limited expressly to the accrual of dividends for the stated period from and after June 1, 2002 and shall not suspend, waive or affect any other provision of (or breach of or default under) the Company's Certificate of Incorporation or Certificate of Designation or any of the other 1999 Investment Documents, whether the same has occurred prior hereto or occurs subsequent hereto. Section 2. Amendment of Other Agreements. (a) Reaffirmation of Purchase Agreement. The Purchase Agreement is not amended or modified hereby and remains in full force and effect. Each party hereto hereby ratifies and reaffirms its obligations and duties under the Purchase Agreement to the fullest extent such obligations and duties remain surviving in accordance with the original terms of the Purchase Agreement. (b) Amendment of 1999 Registration Rights Agreement. Each of the parties hereto shall, simultaneously with the consummation of the transactions contemplated hereby, enter into an agreement in the form of Exhibit B attached hereto (the "2002 Registration Rights Agreement") for the purpose of amending and restating the 1999 Registration Rights Agreement. -2- (c) Amendment of 1999 Corporate Governance Agreement. Each of the parties hereto shall, simultaneously with the consummation of the transactions contemplated hereby, enter into an agreement in the form of Exhibit C attached hereto (the "2002 Corporate Governance Agreement") for the purpose of amending and restating the 1999 Corporate Governance Agreement. Section 3. Representations and Warranties. Each Investor (to induce the Company to enter into this Agreement) and the Company (to induce each Investor to enter into the Agreement) represents and warrants to the other that: (a) No Breach or Default. Such Person has not breached and is not in default of any of its obligations or duties under any of the 1999 Investment Documents, as in effect immediately prior to the effectiveness of this Agreement; and (b) Requisite Authority, etc (i) The execution, delivery and performance by such Person of this Agreement and of each of the other agreements and documents referred to herein is within its corporate, partnership or limited liability company powers, as applicable, and has been duly authorized by all necessary corporate, partnership or limited liability company action on its part, as applicable, (ii) this Agreement and each of the other agreements and documents referred to herein is the legal, valid and binding obligation of such Person enforceable against such Person in accordance with its terms and (iii) neither the execution, delivery or performance by such Person of this Agreement (1) violates any law or regulation, or any other or decree of any governmental body, (2) conflicts with or results in the breach or termination of, constitutes a default under or accelerates any performance required by, any indenture, mortgage, deed of trust, lease, agreement or other instrument to which such Person is a party or by which such Person or any of its property is bound, (3) violates or conflicts with the certificate of incorporation, partnership or limited liability company agreement, or other organizational documents of such Person, or (4) requires the consent, approval or authorization of, or declaration or filing with, any Person, except for those already duly obtained. Section 4 Conditions Precedent. The effectiveness of this Agreement is subject to the following conditions precedent: (a) Representations and Warranties. The representations and warranties of the Company contained herein shall be true and correct as of the date hereof. -3- (b) Execution and Delivery of Documents. The following agreements and documents shall have been duly authorized, executed and delivered by the Company: (i) the 2002 Registration Rights Agreement; (ii) the 2002 Corporate Governance Agreement; and (iii) a Certificate of the Secretary of the Company certifying as to the validity of the resolutions of the Company's board of directors authorizing the execution, delivery and performance by the Company of this Agreement and each of the other agreements and documents referred to herein. Section 5. Effect on the Company's Certificate of Incorporation and Certificate of Designation. (a) Ratification and Reaffirmation. The Company's Certificate of Incorporation (as amended prior to the date hereof) and the Company's Certificate of Designation (except as specifically amended in accordance with Section 1 above) remain in full force and effect. The Company hereby ratifies and reaffirms its Certificate of Incorporation and Certificate of Designation (as the latter will be amended in accordance with the terms of this Agreement) and all of its obligations and duties thereunder. (b) Limitation of Waiver. The execution, delivery and effectiveness of this Agreement shall not operate as a waiver of any right, power or remedy of the Investors under the Company's Certificate of Incorporation or Certificate of Designation or under the General Corporation Law of the State of Delaware, except to the limited extent set forth in Section 1 above. Notwithstanding anything contained herein, the terms of this Agreement are not intended to and do not effect an amendment or waiver of any provision of the Company's Certificate of Incorporation or Certificate of Designation with respect to any matter other than the accrual of dividends from and after June 1, 2002. For avoidance of doubt, the -4- Company hereby acknowledges and agrees that no portion of the dividends that have accrued and/or accumulated on the outstanding Preferred Shares from and after their issuance and through and including May 31, 2002 are waived, affected or diminished by this Agreement (or any of the other agreements or documents referred to herein), and all such dividends shall remain so accrued and/or accumulated following the effectiveness hereof. Section 6 Miscellaneous. (a) Successors and Assigns. This Agreement shall be binding on and shall inure to the benefit of Company, the Investors and their respective successors and assigns (including, without limitation, the Investors' Permitted Transferees (as defined in the Restated Corporate Governance Agreement)). (b) Entire Agreement. This Agreement, together with the agreements and documents referred to herein, constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and (except to the extent of the ratifications and reaffirmations of the 1999 Investment Documents set forth herein) supersedes all other understandings, oral or written, with respect to the subject matter hereof. (c) Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. (d) Severability. Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. (e) Counterparts. This Agreement may be executed in any number of separate original counterparts (or telecopied counterparts with original execution copy to follow) and by the different parties on separate counterparts, each of which shall be deemed to be an original, but all of such counterparts shall together constitute one agreement. -5- (f) Expenses. Each party hereto shall pay its own fees and expenses in connection with the negotiation and preparation of this Agreement and the consummation of the transactions contemplated hereby, with the exception that the Company shall pay or reimburse the Investors for up to $15,000 of the Investors' reasonable attorneys' fees and expenses in connection this Agreement and the matters contemplated hereby. (Signature page follows) -6- Signature Page to Amendment and Waiver Agreement Delivered at Chicago, Illinois, as of the day and year first above written. Company: Stericycle, Inc. By: /s/ Mark C. Miller --------------------------------------------- President and Chief Executive Officer MDP Entities: Madison Dearborn Capital Partners III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ---------------------------------------------- A Managing Director Madison Dearborn Special Equity III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche --------------------------------------------- A Managing Director Madison Dearborn Capital Partners III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ---------------------------------------------- A Managing Director -7- Bain Entities: Bain Capital Fund VI, L.P. By: Bain Capital Partners VI, L.P. Its: General Partner By: Bain Capital Investors, LLC Its: General Partner By: /s/ Paul Edgerly ------------------------------------------------ A Managing Director BCIP Associates II By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------ Name: Title: BCIP Associates II-B By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------ Name: Title: BCIP Associates II-C By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------ Name: Title: -8- BCIP Trust Associates II By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly --------------------------------------------- Name: Title: BCIP Trust Associates II-B By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly --------------------------------------------- Name: Title: Pep Investments Pty. Limited By: Bain Capital Investors, LLC Its: Attorney-in-Fact By: --------------------------------------------- Name: Title: Brookside Capital Partners Fund, L.P. By: /s/ Ed Brakeman --------------------------------------------- Name: Ed Brakeman Title: Managing Director Sankaty High Yield Asset Partners, L.P. By: /s/ Kristin Mugford --------------------------------------------- Name: Kristin Mugford Title: Managing Director Sankaty High Yield Partners II, L.P. By: /s/ Kristin Mugford --------------------------------------------- Name: Kristin Mugford Title: Managing Director -9- Schedule I Investors MDP Entities Madison Dearborn Capital Partners III, L.P. Madison Dearborn Special Equity III, L.P. Special Advisors Fund I, LLC Bain Entities Bain Capital Fund VI, L.P. BCIP Associates II BCIP Associates II-B BCIP Associates II-C BCIP Trust Associates BCIP Trust Associates II-B PEP Investments Pty. Limited Brookside Capital Partners Fund L.P. Sankaty High Yield Asset Partners, L.P. Sankaty High Yield Partners II, L.P. -10- Exhibit A Stericycle, Inc. - -------------------------------------------------------------------------------- First Amendment to Certificate of Designation Relating to Series A Convertible Preferred Stock, Par Value $.01 Per Share - -------------------------------------------------------------------------------- Pursuant to Section 242 of the General Corporation Law of the State of Delaware, Stericycle, Inc., a Delaware corporation (the "Corporation"), hereby certifies that: (a) pursuant to the authority contained in Article Four of the Corporation's Amended and Restated Certificate of Incorporation filed on August 19, 1996, as amended by a First Certificate of Amendment filed on November 4, 1999, a Certificate of Designation Relating to Series A Convertible Preferred Stock, Par Value $.01 Per Share, filed on November 4, 1999, and a Second Certificate of Amendment filed on May 17, 2002 (the Corporation's Amended and Restated Certificate of Incorporation as so amended, the "Restated Certificate of Incorporation"), and (b) in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware, the following resolution was duly adopted by the Corporation's Board of Directors: RESOLVED, that the Corporation's Certificate of Designation Relating to Series A Convertible Preferred Stock, Par Value $.01 Per Share, filed on November 4, 1999 (the "Series A Preferred Stock Certificate of Designation"), is amended as follows: 1. Amendment of Section 1 ("Dividends") Section 1 ("Dividends") of the Series A Preferred Stock Certificate of Designation is deleted in its entirety and the following is substituted in its place: 1. Dividends. 1A. Preferential Dividends. Subject to Section 1B, preferential dividends on each share of Series A Preferred Stock shall accrue daily (whether or not there are profits or surplus available therefor) at the rate of 3.375% per annum of the Liquidation Preference thereof from the date of issuance of such share until the earliest of (i) the date on which the Liquidation Value of such share of Series A Preferred Stock is paid to the holder thereof in connection with the liquidation of the Corporation or the Corporation's redemption of such share of Series A Preferred Stock, (ii) the date on which such share of Series A Preferred Stock is converted into shares of Common Stock or (iii) the date on which such share of Series A Preferred Stock is otherwise acquired by the Corporation. Accrued preferential dividends on each share of Series A Preferred Stock shall accumulate annually on the anniversary of the date of initial issuance of such share. When and as declared, preferential dividends shall be paid only by the issuance of additional shares of Series A Preferred Stock (including fractional shares thereof) having an aggregate Liquidation Value at the time of such payment equal to the amount of the dividend to be paid. If and when any shares of Series A Preferred Stock are issued under this Section 1A for the payment of accumulated dividends and accrued dividends which have not yet been accumulated, such shares of Series A Preferred Stock shall be deemed to be validly issued and outstanding and fully paid and nonassessable. 1B. Cessation of Accrual of Dividends. Preferential dividends payable under Section 1A on shares of Series A Preferred Stock shall be deemed to have ceased to accrue after May 31, 2002, and there shall be no accrual after May 31, 2002 of preferential dividends on shares of Series A Preferred Stock unless: (a) the Corporation breaches or for any reason fails to perform or comply with any of its obligations in respect of the exercise of any rights of holders of Series A Preferred Stock under any one or more of the Transaction Documents, and (b) the breach or failure continues for 10 days following the Corporation's receipt of written notice of its breach or failure from or on behalf of any one or more of the affected holders of Series A Preferred Stock. In this event, preferential dividends shall resume accruing daily on the shares of Series A Preferred Stock held by all affected holders, at the rate of 3.375% per annum of the Liquidation Preference of their shares, beginning on the 11th day after the Corporation's receipt of written notice of its breach or failure and continuing through the date on which the Corporation has fully performed or complied with its obligations under the Transaction Documents in respect of the exercise of the rights in question of the affected holders of Series A Preferred Stock. -2- Nothing in this Section 1B shall operate as a forfeiture or reduction in any respect in any preferential dividends payable under Section 1A on shares of Series A Preferred Stock that accrued or accumulated prior to June 1, 2002, all of which shall remain so accrued or accumulated without modification. 1C. Participating Dividends. In addition to preferential dividends payable under Section 1A, holders of Series A Preferred Stock shall share pro rata with holders of Common Stock, on the basis of the number of shares of Common Stock which each holder of Preferred Stock would be entitled to receive upon conversion of the holders Preferred Stock into Common Stock as of the record date for the dividend or distribution, in all other dividends and distributions, if any, that the Corporation's board of directors may declare from time to time. 2. Amendment of Section 3 ("Voting Rights") Section 3 ("Voting Rights") of the Series A Preferred Stock Certificate of Designation is deleted in its entirety and the following is substituted in its place: 3. Voting Rights. 3A. Ordinary Voting. Except as otherwise required by law, the Corporation's Restated Certificate of Incorporation or this Certificate of Designation, holders of Series A Preferred Stock shall be entitled to vote with holders of Common Stock as a single class on each matter submitted to a vote of the Corporation's stockholders. Each share of Series A Preferred Stock shall have a number of votes equal to the number of votes possessed by the number of shares of Common Stock into which the share of Series A Preferred Stock is convertible as of the record date for determining the stockholders entitled to vote on the matter. Any fractional voting rights that result (after aggregating, in the case of each holder of Series A Preferred Stock, all shares of Common Stock into which all of the holder's shares of Series A Preferred Stock could be converted) shall be rounded upwards or downwards to the nearest whole number (with one-half being rounded upwards). 3B. Election of Directors. So long as the members of a Group hold at least 25% of the Underlying Common Stock (determined as of the date of the initial issuance of Series A Preferred Stock), holders of Series A Preferred Stock who are members of the Group, voting separately as a single class, to the exclusion of all other classes of the Corporation's capital stock and all other shares of Series A Preferred Stock held by members of the other Group, with each share of Series A Preferred Stock entitled to one vote, shall be entitled, in the election of directors of the Corporation, to elect one director to serve on the -3- Corporation's board of directors. Each director so elected shall serve until his successor is duly elected by the Group's holders of Series A Preferred Stock or he is removed from office by the Group's holders of Series A Preferred Stock. If a Group's holders of Series A Preferred Stock for any reason fail to elect anyone to fill any such directorship, the position shall remain vacant until such time as the Group's holders of Series A Preferred Stock elect a director to fill the position, and it shall not be filled by resolution or vote of the Corporation's board of directors or its other stockholders. In the event that the members of a Group cease to hold at least 25% of the Underlying Common Stock (determined as of the date of the initial issuance of Series A Preferred Stock), the right and power provided to the Group's holders of Series A Preferred Stock by this Section 3B shall terminate. 3. Amendment of Section 4B ("Conversion Price") Section 4B ("Conversion Price") of the Series A Preferred Stock Certificate of Designation is deleted in its entirety and the following is substituted in its place: 4B. Conversion Price. The conversion price for Series A Preferred Stock (the "Conversion Price") was $17.50 initially and, in accordance with Section 4C, is now $8.75 by reason of the Corporation's 2-for-1 split of its Common Stock in the form a stock dividend of one share payable on May 31, 2002 on each share of Common Stock outstanding on May 16, 2002. In order to prevent dilution of the conversion rights granted under Section 4A, the Conversion Price for Series A Preferred Stock shall be subject to adjustment from time to time pursuant to Sections 4C, 4D, 4E and 4F. 3. Amendment of Section 13 ("Definitions") Section 13 ("Definitions") of the Series A Preferred Stock Certificate of Designation is amended to add the following definitions: Corporate Governance Agreement means the Amended and Restated Corporate Governance Agreement, dated July 26, 2002, entered into by the Corporation and the holders of Series A Preferred Stock, as it may be amended. Group means either: (a) the group consisting of (i) the initial purchasers of Series A Preferred Stock associated with Bain Capital Partners, Inc. (now known as "Bain Capital Partners, LLC") and (ii) their Permitted Transferees; or (b) the group consisting of (i) the initial purchasers of Series A Preferred Stock associated with Madison Dearborn Partners, Inc. (now known as "Madison Dearborn Partners, LLC") and (ii) their Permitted Transferees. -4- Permitted Transferees is defined in the Corporate Governance Agreement. Transaction Documents means the following: (a) this Certificate of Designation, as it has been and may be amended in accordance with Section 11: (b) the Corporate Governance Agreement; (c) the Amended and Restated Registration Rights Agreement, dated July 26, 2002, entered into by the Corporation and the holders of Series A Preferred Stock, as it may be amended; (d) the Amended and Restated Preferred Stock Purchase Agreement, dated as of September 26, 1999, entered into by the Company and the initial purchasers of Series A Preferred Stock, as it may be amended; and (e) the Amendment and Waiver Agreement, dated July 26, 2002, entered into by the Corporation and the holders of Series A Preferred Stock, as it may be amended. -5- In witness, the Corporation has caused this First Certificate of Designation to be signed by its President and Chief Executive Officer, Mark C. Miller, on [date]. His signature below constitutes his affirmation and acknowledgement, under penalties of perjury, that this instrument is the Corporation's act and deed and that the facts stated in this instrument are true. Stericycle, Inc. By ------------------------------------------- Mark C. Miller President and Chief Executive Officer -6- EX-10.3 6 dex103.txt AMENDED & RESTATED CORPORATE GOVERNANCE AGMT Exhibit 10.3 Amended and Restated Corporate Governance Agreement This Agreement is entered into as of July 26, 2002 by Stericycle, Inc., a Delaware corporation (the "Company"), and the Persons whose names are set forth on the attached Schedule I (collectively, the "Investors"). A. The Company and the Investors are the parties currently bound by that certain Registration Rights Agreement, dated as of November 12, 1999 (the "1999 Registration Rights Agreement"), which was entered into at the closing of that certain concurrently closing an Amended and Restated Preferred Stock Purchase Agreement (the "Purchase Agreement"), pursuant to the terms and conditions of which the Company issued and sold to the purchasers and the purchasers purchased from the Company, 75,000 shares of the Company's Series A Convertible Preferred Stock (the "Preferred Shares"). B. The Company and the Investors desire to amend and restate the 1999 Corporate Governance Agreement as set out in this Agreement. C. This Agreement is entered into pursuant to the Amendment and Waiver Agreement, dated as of the same date as this Agreement (the "Waiver Agreement"), entered into by the Company and the Investors. The execution and delivery of this Agreement by the Company and the Investors is a condition of the Waiver Agreement becoming effective. The Company and the Investors agree that the 1999 Corporate Governance Agreement is amended and restated as follows, effective as of June 1, 2002: 1. Definitions. Capitalized terms which are used in this Agreement without being defined have the same meanings that they are given in the Purchase Agreement. In addition, the following terms have these meanings: Board of Directors or Board means the Company's board of directors. Converted Shares means the shares of Common Stock actually received by an Investor or a Permitted Transferee upon conversion of some or all of the Current Preferred Shares. Current Preferred Shares means the shares of Preferred Stock listed under the caption "Preferred Shares" on the attached Schedule I. Group means either: (a) the group (the "Bain Group") consisting of (1) the Investors listed under the caption "Bain Entities" on the attached Schedule I (for as long as each such Investor continues to be the beneficial owner of Shares), and (2) the Permitted Transferees of such Investors (for as long as each such Permissible Transferee continues to be the beneficial owner of Shares); or (b) the group (the "MDP Group") consisting of (1) the Investors listed under the caption "MDP Entities" on the attached Schedule I (for as long as each such Investor continues to be the beneficial owner of Shares), and (2) the Permitted Transferees of such Investors (for as long as each such Permissible Transferee continues to be the beneficial owner of Shares). Initial Interest means, in respect of a Group, the aggregate number of shares of Common Stock into which the Group's Preferred Shares were convertible as of Closing of the Purchase Agreement on November 12, 1999, as adjusted for the 2-for-1 stock split in the Company's Common Stock in the form of a dividend of one share payable on May 31, 2002. As so adjusted, the Initial Interest of each Group was 4,285,715 shares of Common Stock (rounding the resulting fractional upwards to a whole share). Investor Nominee means any person nominated by a Group's Permitted Owners to serve as a director of the Company pursuant to this Agreement. Permitted Owner means, in respect of a Group, (i) an Investor who is a member of the Group, for as long as the Investor continues to be the beneficial owner of Shares, and (ii) each Permitted Transferee of an Investor who is a member of the Group, for as long as the Permitted Transferee continues to be the beneficial owner of Shares. Permitted Transferee means: (a) any Affiliate (including any partner) of any Investor to whom an Investor or another Affiliate of the Investor or any other Investor who is a member of the same Group Transfers Current Preferred Shares or Converted Shares; (b) any other Person to whom an Investor or an Affiliate of the Investor or any other Investor who is a member of the same Group Transfers Current Preferred Shares or Converted Shares with the prior written consent of the Board of Directors; and (c) any Person to whom a transferee described in clause (b) Transfers Current Preferred Shares or Converted Shares with the prior written consent of the Board of -2- Directors. In no event shall any Person who acquires Converted Shares pursuant to a Rule 144 Sale or an offering registered under the Securities Act be considered a Permitted Transferee. No Transfer otherwise permissible shall be effective unless the transferee agrees in writing expressly for the Company's benefit to be bound by the provisions of this Agreement, and in this event, the transferor shall not be liable for the transferee's performance of its obligations under this Agreement. Rule 144 Sale means a transaction exempt from registration pursuant to Rule 144 under the Securities Act. Shares means, at any time, the aggregate number of (i) Converted Shares then held by the Investors and Permitted Transferees and (ii) Converted Shares that the Investors and Permitted Transferees then have the right to receive upon a conversion of all Current Preferred Shares then held by them. Transfer means to sell, assign, transfer (voluntarily or involuntarily), exchange (by merger or otherwise) or otherwise dispose of or to grant a lien, encumbrance, pledge or other form of security interest. 2. Corporate Governance. 2A. Appointment of Investor Nominees. Each Group currently has an Investor Nominee serving on the Board of Directors: John P. Connaughton serves as the Investor Nominee of the Bain Group, and Thomas R. Reusche serves as the Investor Nominee of the MDP Group. An Investor Nominee serves and shall continue to serve on each committee of the Board. 2B. Maintenance of Directorships. (a) For as long as Shares representing at least 25% in the aggregate of a Group's Initial Interest are beneficially owned by the Group's Permitted Owners, the Group's Permitted Owners shall continue to have the right to nominate one person for election to the Company's Board of Directors. The Company shall nominate the person so designated and shall use reasonable efforts to have the nominee elected to its Board of Directors. (The Company's obligations under this Section 2B(a) shall be deemed satisfied if a person designated by the Group is elected to the Board by holders of Preferred Shares pursuant to the Certificate of Designation.) (b) If at any time Shares representing at least 25% in the aggregate of a Group's Initial Interest cease to be beneficially owned by the Group's Permitted Owners, the Group's Permitted Owners shall cease to be entitled to nominate one person for election to the Company's Board of Directors, and the Group's Investor Nominee currently serving as a director shall immediately resign upon the Company's written request. -3- 2C. Removal and Replacement. (a) If at any time a Group's Permitted Owners notify the Board of Directors of their wish to remove the Group's incumbent Investor Nominee as a director, the Board shall vote to remove the Investor Nominee (if his or her removal is permitted under the Company's bylaws and the Delaware General Corporation Law). Removal of a Group's incumbent Investor Nominee by the Board otherwise than at the request of the Group's Permitted Owners shall require their prior written consent unless the removal is based upon the Investor Nominee's willful misconduct. (b) If at any time a vacancy is created on Board of Directors by reason of the incapacity, death, removal or resignation of a Group's incumbent Investor Nominee, the Group's Permitted Owners shall designate a person to fill the vacancy (who promptly shall be appointed by the incumbent directors). If a Group's Permitted Owners nominate an Investor Nominee for election to the Board of Directors and the Company's stockholders fail to elect him or her to office, the Group's Permitted Owners shall be entitled to designate a substitute Investor Nominee to fill the resulting vacancy (who promptly shall be appointed by the incumbent directors). (c) At each meeting of stockholders of the Company at which directors are elected, the nominees for directors proposed by the Company shall include the Investor Nominee or Nominees required pursuant to this Agreement. 2D. Investor Nominee. Each incumbent Investor Nominee shall receive notice of each meeting of the Board of Directors at the same time and in the same manner as other members of the Board. Each incumbent Investor Nominee shall be entitled to indemnification rights, travel and expense reimbursement and compensation substantially similar to those of other non-employee directors of the Company. The Company shall at all times maintain a directors and officer insurance policy covering each incumbent Investor Nominee that provides in the aggregate substantially the same coverage as the policy covering the current directors of the Company as of the date of this Agreement. 2E. Actions by Permitted Owners. Any action by a Group's Permitted Owners under this Section 2 shall be by majority vote of the Permitted Owners, with each Preferred Share having a number of votes equal to the number of Converted Shares into which it may then be converted, and each Converted Share having one vote. 3. Certain Actions of the Company. 3A. Actions. Subject to Section 3B, the Company shall not do any of the following (whether in one or -4- a series of related actions or transactions) without the approval of holders of a majority of the Shares then beneficially owned by Permitted Owners: (1) declare or pay any dividend or other payment to holders of Common Stock or any other securities junior in right of payment to the Preferred Shares; (2) increase the size of the Company's Board (other than pursuant to Section 2A); (3) merge or consolidate with, or permit any Subsidiary to merge or consolidate with, any Person (other than a merger or consolidation between the Company and a wholly-owned Subsidiary or between one wholly-owned Subsidiary and another), or acquire, or permit any Subsidiary to acquire, any interest in any Person or business (whether by purchase of assets, purchase of stock, merger or otherwise), involving an aggregate consideration (including assumed liabilities) exceeding $20,000,000 in any one transaction or series of related transactions or exceeding $50,000,000 in any 12-month period; (4) divest or dispose of, or permit any Subsidiary to divest or dispose of, any business or other assets (other than obsolete or worn-out assets), whether by sale of assets, sale of stock, merger or otherwise, involving an aggregate consideration exceeding $20,000,000 in any one transaction or series of related transactions or exceeding $50,000,000 in any 12-month period; (5) become subject to or permit any Subsidiary to become subject to, or amend, any Contract which by its terms would restrict the Company's right to perform the provisions of this Agreement, the Registration Agreement, the Certificate of Designation, the Company's certificate of incorporation and the Company's bylaws that benefit the Investors; (6) enter into or amend, or permit any Subsidiary to enter into or amend, any Contract, transaction or arrangement with any of its or any Subsidiary's officers, directors, employees, stockholders or Affiliates, except for (i) customary employment and director arrangements consistent with past practice, (ii) benefit programs on reasonable terms consistent with past practice, (iii) transactions or arrangements between the Company and any wholly-owned Subsidiary or between one wholly-owned Subsidiary and another (treating 3CI Complete Compliance Corporation as a wholly-owned Subsidiary for purposes of this clause (iii)), and (iv) transactions with an Affiliate that arise solely as a result of owning an equity interest in the Affiliate; or (7) directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, incur), or permit any Subsidiary to incur, any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and will not permit any Subsidiary to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Companies most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such -5- Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. Capitalized terms used in Section 3A(7) which are not defined elsewhere in this Agreement have the same meanings that the same or corresponding terms are given in the Trust Indenture dated as of November 12, 1999 entered into by the Company in connection with its offering of the Subordinated Notes (the "Trust Indenture"). The restriction in Section 3A(7) shall not prohibit the incurrence of any Permitted Debt (as Permitted Debt is defined in connection with the corresponding covenant by the Company under the Trust Indenture). 3B. Termination. The restriction in Section 3A(1) shall terminate when both Groups' Permitted Owners, considered together, cease beneficially to own in the aggregate Preferred Shares representing at least 25% of both Groups' Initial Interests in the aggregate. The restriction in Section 3A(2) shall terminate when both Groups' Permitted Owners cease to be entitled under both this Agreement and the Certificate of Designation to nominate any person for election to the Company's Board of Directors. The restrictions in each of Sections 3A(3), (4), (5), (6) and (7) shall terminate when both Groups' Permitted Owners, considered together, cease beneficially to own in the aggregate Shares representing at least 20% of both Groups' Initial Interests in the aggregate. 4. Restrictions on Transfer. 4A. Restrictions on Transfer. Prior to November 12, 2004, except for Transfers to a Permitted Transferee, no Permitted Owner shall Transfer any Preferred Shares. This restriction shall not apply to (i) the Transfer of any Preferred Shares which a Permitted Owner has a right to have redeemed pursuant to Section 5A of the Certificate of Designation but which for any reason the Company has failed to redeem within 30 days after the Permitted Owner's exercise of his or its redemption right (ii) or to the Transfer of any securities other than Preferred Shares. The right of a Permitted Owner under the preceding sentence shall be in addition to any other rights and remedies available to the Permitted Owner at law or in equity. 5. Miscellaneous. 5A. Notices. All Notices under this Agreement shall be in writing and sent by certified or registered mail, overnight messenger service, telecopier or personal delivery, as follows: -6- (a) if to Stericycle, to: Stericycle, Inc. 28161 North Keith Drive Lake Forest, Illinois 60045 Attention: Mr. Mark C. Miller President and Chief Executive Officer Telecopier: (847) 367-9493 with a required copy to: Johnson and Colmar 300 South Wacker Drive Suite 1000 Chicago, Illinois 60606 Attention: Craig P. Colmar, Esq. Telecopier: (312) 922-9283 (b) if to an Investor who is a member of the Bain Group, in care of: Bain Capital Investors, LLC 111 Huntington Avenue Boston, Massachusetts 02199 Boston, Massachusetts 02116 Attention: Mr. Stephen G. Pagliuca Mr. Robert Gay Mr. John P. Connaughton Mr. Joe Pretlow Telecopier: (617) 516-2010 (c) if to an Investor who is a member of the MDP Group, in care of: Madison Dearborn Partners, LLC Three First National Plaza Suite 3800 Chicago, Illinois 60602 Attention: Mr. Thomas R. Reusche Telecopier: (312) 895-1156 with a required copy, in the case of a Notice to any Investor, to: Kirkland & Ellis 200 East Randolph Drive Chicago, Illinois 60601 Attention: Jeffrey C. Hammes, P.C. -7- Telecopier: (312) 861-2200 All Notices sent by certified or registered mail shall be considered to have been given three business days after being deposited in the mail. All Notices sent by overnight courier service, telecopier or personal delivery shall be considered to have been given when actually received by the intended recipient. A Party may change its address for purposes of this Agreement by Notice in accordance with this Section 5A. 5B. Waiver. The rights and remedies of the Parties are cumulative and not alternative. Neither the failure nor any delay by any Party in exercising any right, power or privilege under this Agreement or the documents referred to in this Agreement shall operate as a waiver of that right, power or privilege, and no single or partial exercise of any right, power or privilege shall preclude any other or further exercise of that right, power or privilege or the exercise of any other right, power or privilege. All waivers shall be in writing signed by the Party to be charged with the waiver, and no waiver that may be given by a Party shall be applicable except in the specific instance for which it is given. 5C. Entire Agreement. This Agreement supersedes all prior agreements between the Parties with respect to its subject matter and constitutes a complete and exclusive statement of the terms of the agreement between the Parties with respect to its subject matter. This Agreement may not be amended except by a written agreement signed by the Party to be charged with the amendment. 5D. No Third Party Beneficiaries. Nothing in this Agreement shall be considered to give any Person other than the Parties (and Permitted Transferees) any legal or equitable right, claim or remedy under or in respect of this Agreement or any provision of this Agreement. This Agreement and all of its provisions are for the sole and exclusive benefit of the Parties and their respective successors and permitted assigns. 5E. Equitable Relief. In addition to any other remedies which may be available, the Company and each Permitted Owner shall be entitled to equitable relief, including injunctive relief and specific performance, in the event of any breach of the provisions of this Agreement, the Purchase Agreement, the Registration Rights Agreement, as amended and restated, or the Certificate of Designation, as amended and restated, by another Party, and neither the Company nor any Permitted Owner nor the Investor Nominee or Nominees shall oppose the granting of such relief. -8- 5F. Severability. If any provision of this Agreement is held invalid or unenforceable by a court of competent jurisdiction, the other provisions of this Agreement shall remain in full force and effect. Any provision of this Agreement which is held invalid or unenforceable only in part shall remain in full force and effect to the extent not held invalid or unenforceable. 5G. Captions. The captions of sections of this Agreement are for convenience only and shall not affect this the construction or interpretation of this Agreement. 5H. Construction. All references in this Agreement to Section or Sections refer to the corresponding section or sections of this Agreement. All words used in this Agreement shall be construed to be of the appropriate gender or number as the context requires. Unless otherwise expressly provided, the word including does not limit the preceding words or terms. 5I. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be considered an original copy of this Agreement and all of which, when taken together, shall be considered to constitute one and the same agreement. 5J. Governing Law. This Agreement shall be governed by the Laws of the State of Illinois without regard to conflicts of laws principles. 5K. Binding Effect. This Agreement shall apply to, be binding in all respects upon and inure to the benefit of Parties and their respective successors and permitted assigns. -9- In witness, the Parties have executed this Agreement. Company: Stericycle, Inc. By: /s/ Mark C. Miller ------------------------------------------------------ President and Chief Executive Officer MDP Entities: Madison Dearborn Capital Partners III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ------------------------------------------------------ A Managing Director Madison Dearborn Special Equity III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ------------------------------------------------------ A Managing Director Madison Dearborn Capital Partners III, L.P. By: Madison Dearborn Partners III, L.P. Its: General partner By: Madison Dearborn Partners, LLC Its: General Partner By: /s/ Thomas R. Reusche ------------------------------------------------------ A Managing Director -10- Bain Entities: Bain Capital Fund VI, L.P. By: Bain Capital Partners VI, L.P. Its: General Partner By: Bain Capital Investors, LLC Its: General Partner By: /s/ Paul Edgerly ------------------------------------------------------ A Managing Director BCIP Associates II By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------------ Name: Title: BCIP Associates II-B By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------------ Name: Title: BCIP Associates II-C By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------------ Name: Title: -11- BCIP Trust Associates II By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------------ Name: Title: BCIP Trust Associates II-B By: Bain Capital Investors, LLC Its: Managing General Partner By: /s/ Paul Edgerly ------------------------------------------------------ Name: Title: Pep Investments Pty. Limited By: Bain Capital Investors, LLC Its: Attorney-in-Fact By: ------------------------------------------------------ Name: Title: Brookside Capital Partners Fund, L.P. By: /s/ Ed Brakeman ------------------------------------------------------ Name: Ed Brakeman Title: Managing Director Sankaty High Yield Asset Partners, L.P. By: /s/ Kristin Mugford ------------------------------------------------------ Name: Kristin Mugford Title: Managing Director Sankaty High Yield Partners II, L.P. By: /s/ Kristin Mugford ------------------------------------------------------ Name: Kristin Mugford Title: Managing Director -12- Schedule I Preferred Shares Preferred Shares MDP Entities Madison Dearborn Capital Partners III, L.P. ................ 22,267.55 Madison Dearborn Special Equity III, L.P. .................. 494.44 Special Advisors Fund I, LLC ............................... 91.42 ----------- Total .................................................... 22,853.41 Bain Entities Bain Capital Fund VI, L.P. ................................. 15,437.45 BCIP Associates II ......................................... 2,732.19 BCIP Associates II-B ....................................... 374.57 BCIP Associates II-C ....................................... 802.00 BCIP Trust Associates ...................................... 781.81 BCIP Trust Associates II-B ................................. 124.77 PEP Investments Pty. Limited ............................... 51.45 Brookside Capital Partners Fund L.P. ....................... 1,123.92 Sankaty High Yield Asset Partners, L.P. .................... 561.96 Sankaty High Yield Partners II, L.P. ....................... 561.96 ----------- Total .................................................... 22,552.07 Grand Total ................................................... 45,405.47 =========== -13- -----END PRIVACY-ENHANCED MESSAGE-----