[Federal Register Volume 63, Number 185 (Thursday, September 24, 1998)]
[Notices]
[Pages 51126-51161]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-24974]



[[Page 51125]]

_______________________________________________________________________

Part II





Department of Justice





_______________________________________________________________________



Antitrust Division



_______________________________________________________________________



Proposed Final Judgment and Competitive Impact Statement; Notice

  Federal Register / Vol. 63, No. 185 / Thursday, September 24, 1998 / 
Notices  

[[Page 51126]]



DEPARTMENT OF JUSTICE

Antitrust Division
[Civ. No. 1:98 CV 1616]


Proposed Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. sections 16(b)-(h), that a proposed Final 
Judgment, Hold Separate Stipulation and Order, and Competitive Impact 
Statement have been filed with the United States District Court for the 
Northern District of Ohio, Eastern Division, in United States and 
States of Ohio, Arizona, California, Colorado, Florida, Maryland, New 
York, Texas, Washington, and Wisconsin, and Commonwealths of Kentucky 
and Pennsylvania v. USA Waste Services, Inc., Dome Merger Subsidiary, 
and Waste Management, Inc. Civ. No. 1:98 CV 1616.
    On July 16, 1998, the United States and the listed eleven states 
and two commonwealths filed a Complaint, which alleged that USA Waste's 
proposed acquisition of Waste Management would violate Section 7 of the 
Clayton Act, 15 U.S.C. 18, by substantially lessening competition in 
commercial waste collection and/or municipal solid waste disposal in 21 
geographic markets around the country, including: Akron, Canton, 
Cleveland and Columbus, OH; Allentown, Pittsburgh and Philadelphia, PA; 
Baltimore, MD; Denver, CO; Detroit, Flint and Northeast Michigan; 
Houston, TX; Los Angeles, CA; Louisville, KY; Miami and Gainesville, 
FL; Milwaukee, WI; New York, NY; Portland, OR; and Tucson, AZ. The 
proposed Final Judgment, filed the same day as the Complaint, requires 
that USA Waste and Waste Management divest commercial waste collection 
and/or municipal solid waste disposal operations in each of the 
geographic areas alleged in the Complaint.
    Public comment is invited within the statutory 60-day comment 
period. Such comments and responses thereto will be published in the 
Federal Register and filed with the Court. Comments should be directed 
to J. Robert Kramer, II, Chief, Litigation II Section, Antitrust 
Division, U.S. Department of Justice, 1401 H Street, NW, Suite 3000, 
Washington, D.C. 20530 [telephone: (202) 307-0924].
Constance K. Robinson,
Director of Operations & Merger Enforcement.

Hold Separate Stipulation and Order

    It is hereby stipulated and agreed by and between the undersigned 
parties, subject to approval and entry by the Court, that:

I. Definitions

    As used in this Hold Separate Stipulation and Order:
    A. USA Waste means defendant USA Waste Services, Inc., a Delaware 
corporation with its headquarters in Houston, Texas, and includes its 
successors and assigns, and its subsidiaries (including Dome Merger 
Subsidiary), divisions, groups, affiliates, directors, officers, 
managers, agents, and employees.
    B. WMI means defendant Waste Management, Inc., A Delaware 
corporation with its headquarters in Oak Brook, Illinois, and includes 
its successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, directors, officers, managers, agents, and employees.
    C. Relevant Disposal Assets means, unless otherwise noted, with 
respect to each landfill or transfer station listed and described 
herein, all tangible assets, including all fee and leasehold and 
renewal rights in the listed landfill or transfer station; the garage 
and related facilities; offices; landfill- or transfer station-related 
assets including capital equipment, trucks and other vehicles, scales, 
power supply equipment, interests, permits, and supplies; and all 
intangible assets of the listed landfill or transfer station, including 
landfill- or transfer station-related customer lists, contracts, and 
accounts, or options to purchase any adjoining property.
    Relevant Disposal Assets, as used herein, includes each of the 
following properties:

1. Landfills

a. Akron/Canton, OH
    WMI's Countywide R&D Landfill, located at 3619 Gracement Street, 
SW, East Sparta, OH 44626, and known as the Countywide Landfill;
b. Columbus, OH
    USA Waste's Pine Grove Landfill, located at 5131 Drinkle Road, SW, 
Amanda, OH 43102;
c. Denver, CO
    USA Waste's Front Range Landfill, located at 1830 County Road 5, 
Erie, CO 80516-8005.
d. Detroit, MI
    USA Waste's Carleton Farms Landfill, located at 28800 Clark Road, 
New Boston, MI;
e. Flint, MI
    USA Waste's Brent Run Landfill, located at Vienna Road, Montrose 
Township, Genesee County, MI;
f. Houston, TX
    USA Waste's Brazoria County Landfill, located at 10310 FM-523, 
Angleton, TX 77515; and
g. Los Angeles, CA
    USA Waste's Chiquita Canyon Landfill, located at 29201 Henry Mayo 
Drive, Valencia, CA 91355;
h. Louisville, KY
    USA Waste's Valley View Landfill, located at 9120 Sulphur Road, 
Sulphur, KY 40070;
j. Milwaukee, WI
    USA Waste's Kestrel Hawk Landfill, located at 1989 Oakes Road, 
Racine, WI 53406; and WMI's Mallard Ridge Landfill, located at W. 8470 
State Road 11, Delavan, WI 53315;
k. New York, NY/Philadelphia, PA
    WMI's Modern Landfill & Recycling, located at 4400 Mt. Piscah Road, 
York, PA 17402, and known as the Modern Landfill;
l. Northeast Michigan
    USA Waste's Whitefeather Landfill, located at 2401 Whitefeather 
Road, Pinconning, MI; and Elk Run Sanitary Landfill, located at 20676 
Five Mile Highway, Onaway, MI;
m. Pittsburgh, PA
    WMI's Green Ridge Landfill, located at 717 East Huntingdon Landfill 
Road, Scottdale, PA 15683, and variously known as the Green Ridge 
Landfill, the Y&S Landfill, or the Greenridge Reclamation Landfill;
n. Portland, OR
    USA Waste's North WASCO Landfill, located at 2550 Steel Road, The 
Dalles, OR 97058; and

2. Transfer Stations

a. Akron/Canton, OH
    WMI's Akron Central Transfer Station, located at 389 Fountain 
Street, Akron, OH;
b. Baltimore, MD
    WMI's Southwest Resource Recovery Facility (known as Baltimore 
RESCO or BRESCO), located at 1801 Annapolis Road, Baltimore, MD 21230; 
Baltimore County Resource Recovery Facility, located at 10320 York 
Road, Cockeysville, MD; and Western Acceptance Facility, located at 
3310 Transway Road, Baltimore, MD;

[[Page 51127]]

c. Cleveland, OH
    USA Waste's Newburgh Heights Transfer Station, located at 3227 
Harvard Road, Newburgh Heights, OH 44105 (and known as the Harvard Road 
Transfer Station); and WMI's Strongsville Transfer Station, located at 
16099 Foltz Industrial Parkway, Strongsville, OH;
d. Columbus, OH
    WMI's Reynolds Road Transfer Station, located at 805 Reynolds 
Avenue, Columbus, OH 43201;
e. Houston, TX
    USA Waste's Hardy Road Transfer Station, located at 18784 East 
Hardy, Houston, TX;
f. Louisville, KY
    USA Waste's Poplar Level Road Transfer Station, located at 4446 
Poplar Level Road, Louisville, KY;
g. Miami, FL
    All USA Waste's operations related to its right, title, and 
interest in, or operation or, the Reuters Transfer Station Rights, as 
conveyed to Chambers Waste Systems of Florida, a subsidiary of USA 
Waste, pursuant to the Final Judgment in United States v. Reuter 
Recycling of Florida, Inc., 1996-1 Trade Cas. (CCH) para. 71,353 
(D.D.C. 1996), a copy of which is attached to the proposed Final 
Judgment as Exhibit A;
h. New York, NY
    WMI's SPM Transfer Station, located at 912 East 132nd Street, 
Bronx, NY 10452, and all rights and interests, legal or otherwise, the 
WMI now enjoys, has had or made use of out of the SPMT Transfer 
Station, to deliver waste by truck to rail siding at the Oak Point Rail 
Yard in the Bronx, NY, and at the Harlem River Yards facility, located 
at St. Ann's and Lincoln Avenues at 132nd Street, Bronx, NY 1045; and
i. Philadelphia, PA
    USA Waste's Girard Point Transfer Station, located at 3600 South 
26nd Street. Philadelphia, PA 19145; and USA Waste's Quick Way Inc. 
Municipal Waste Transfer Station, located at SE Corner, Bath and 
Orthodox Streets, Philadelphia, PA 19137.
    D. Relevant Hauling Assets, unless otherwise noted, means with 
respect to each commercial waste collection route or other hauling 
asset described herein, all tangible assets, including capital 
equipment, trucks and other vehicles, containers, interests, permits, 
supplies except real property and improvements to real property (i.e., 
buildings)]; and it includes all intangible assets, including hauling-
related customers lists, contracts and accounts.
    Relevant Hauling Assets, as used herein, includes the assets in the 
following locations:
1. Akron, OH
    USA Waste's and American Waste Corporation's front-end loader truck 
(``FEL'') commercial routes that serve Summit County, Ohio;
2. Allentown, PA
    WMI's FEL commercial routes that serve the cities of Allentown and 
Northampton and Lehigh County, PA;
3. Cleveland, OH
    WMI's FEL commercial routes that serve Franklin County, Ohio;
5. Denver, CO
    USA Waste's FEL commercial routes that serve the City of Denver, 
and Denver and Arapaho County, CO;
6. Detroit, MI
    WMI's FEL commercial routes that serve the City of Detroit and 
Wayne County, MI;
7. Houston, TX
    WMI's FEL commercial routes that serve the City of Houston, the 
Dickinson area, and Harris County, TX;
8. Louisville, KY
    USA waste's FEL commercial routes that serve the City of Louisville 
and Jefferson County, KY;
9. Pittsburgh, PA
    WMI's FEL commercial routes that serve Allegheny County and 
Westmoreland County, PA, and the garage facility (real estate and 
improvements) located at the Y&S Landfill;
10. Portland, OR
    WMI's FEL commercial routes that serve the City of Portland, OR;
11. Tucson, AZ
    USA Waste's FEL commercial routes that serve the City of Tucson and 
Pima County, AZ; and
12. Gainesville, FL
    WMI's FEL commercial routes that serve Alachua County, FL.
    E. Hauling means the collection of nonhazardous waste from 
customers and the shipment of the collected waste to disposal sites.
    F. Waste means nonhazardous municipal solid waste.
    G. Disposal means the business of disposing of waste into approved 
disposal sites.
    H. Relevant area means the county in which the Relevant Hauling 
Assets or Relevant Disposal Assets are located and any adjacent city or 
county, except with respect to the Modern Landfill [see Section 
I(C)(1)(k)], for which the Relevant Area means Philadelphia, PA, and 
New York, NY.
    I. Relevant State means the state in which the Relevant Disposal 
Assets or Relevant Hauling Assets are located, provided however, that 
state is a party to this Final Judgment. With respect to the Modern 
Landfill [see Section I(C)(1)(k)], the Relevant State means the 
Commonwealth of Pennsylvania and the State of New York.

II. Objectives

    The Final Judgment filed in this case in meant to ensure 
defendants' prompt divestitures of the Relevant Disposal Assets and the 
Relevant Hauling Assets for the purpose of establishing viable 
competitors in the waste disposal business or the commercial waste 
hauling business, or both, in the Relevant Areas to remedy the effects 
that plaintiffs allege would otherwise result from USA Waste's 
acquisition of WMI. This Hold Separate Stipulation and Order ensures, 
prior to such divestitures, that the Relevant Disposal Assets and the 
Relevant Hauling Assets are independent, economically viable, ongoing 
business concerns, and that competition is maintained during the 
pendency of the ordered divestitures.

III. Jurisdiction and Venue

    The Court has jurisdiction over the subject matter of this action 
and over each of the parties hereto, and venue of this action is proper 
in the United States District Court for the Northern District of Ohio, 
Eastern Division.

IV. Compliance With and Entry of Final Judgment

    A. The parties stipulate that a Final Judgment in the form hereto 
attached hereto as Exhibit A may be filed with and entered by the 
Court, upon the motion of any party or upon the Court's own motion, at 
any time after compliance with the requirements of the Antitrust 
Procedures and Penalties Act (15 U.S.C. Sec. 16), and without further 
notice to any party or other proceedings, provided that the United 
States has not withdrawn its consent, which it may do at any time 
before the entry of the proposed Final Judgment by serving notice 
thereof on defendants and by filing that notice with the Court.
    B. Defendants shall abide by and comply with the provisions of the 
proposed Final Judgment, pending the Judgment's entry by the Court, or 
until

[[Page 51128]]

expiration of time of all appeals of any Court ruling declining entry 
of the proposed Final Judgment, and shall, from the date of the signing 
of this Stipulation by the parties, comply with all the terms and 
provisions of the proposed Final Judgment as though the same were in 
full force and effect as an order of the Court.
    C. Defendants shall not consummate the transaction sought to be 
enjoined by the Complaint herein before the Court has signed this 
Stipulation and Order.
    D. This Stipulation shall apply with equal force and effect to any 
amended proposed Final Judgment agreed upon in writing by the parties 
and submitted to the Court.
    E. In the event (1) the United States has withdrawn its consent, as 
provided in Section IV(A) above, or (2) the proposed Final Judgment is 
not entered pursuant to this Stipulation, the time has expired for all 
appeals of any Court ruling declining entry of the proposed Final 
Judgment, and the Court has not otherwise ordered continued compliance 
with the terms and provisions of the proposed Final Judgment, then the 
parties are released from all further obligations under this 
Stipulation, and the making of this Stipulation shall be without 
prejudice to any party in this or any other proceeding.
    F. Defendants represent that the divestitures ordered in the 
proposed Final Judgment can and will be made, and that defendants will 
later raise no claim of hardship or difficulty as grounds for asking 
the Court to modify any of the divestiture contained therein.

V. Hold Separate Provisions

    Until the divestitures required by the Final Judgment have been 
accomplished:
    A. Defendants shall preserve, maintain, and operate the Relevant 
Disposal Assets and the Relevant Hauling Assets as independent 
competitors with management, sales and operations held entirely 
separate, distinct and apart from those of defendants' other 
operations. Defendants shall not coordinate the marketing of, or sales 
by, any Relevant Disposal Asset or Relevant Hauling Asset with 
defendants' other operations. Within twenty (20) days after the filing 
of the Complaint, or thirty (30) days after the entry of this Order, 
whichever is later, defendants will inform plaintiffs of the steps 
defendants have taken to comply with this Hold Separate Stipulation and 
Order.
    B. Defendants shall take all steps necessary to ensure that (1) the 
Relevant Disposal Assets and Relevant Hauling Assets will be maintained 
and operated as independent, ongoing, economically viable and active 
competitors in the waste disposal business or waste hauling business, 
or both, in each Relevant Area; (2) management of the Relevant Disposal 
Assets and Relevant Hauling Assets will not be influenced by USA Waste; 
and (3) the books, records, competitively sensitive sales, marketing 
and pricing information, and decision-making concerning the Relevant 
Disposal Assets and Relevant Hauling Assets will be kept separate and 
apart from defendants' other operations. USA Waste's influence over the 
Relevant Disposal Assets and Relevant Hauling Assets shall be limited 
to that necessary to carry out USA Waste's obligations under this Order 
and the Final Judgment.
    C. Defendants shall use all reasonable efforts to maintain and 
increase the sales and revenues of the Relevant Disposal Assets and 
Relevant Hauling Assets, and shall maintain at 1997 or at previously 
approved levels, whichever are higher, all promotional, advertising, 
sales, technical assistance, marketing and merchandising support for 
the Relevant Disposal Assets and Relevant Hauling Assets.
    D. Defendants shall provide sufficient working capital to maintain 
the Relevant Disposal Assets and Relevant Hauling Assets as 
economically viable, and competitive ongoing businesses.
    E. Defendants shall take all steps necessary to ensure that the 
Relevant Disposal Assets and Relevant Hauling Assets are fully 
maintained in operable condition at no lower than their current 
capacity or sales, and shall maintain and adhere to normal repair and 
maintenance schedules for the Relevant Disposal Assets and Relevant 
Hauling Assets.
    F. Defendants shall not, except as part of a divestiture approved 
by plaintiffs, remove, sell, lease, assign, transfer, pledge or 
otherwise dispose of any of the Relevant Disposal Assets and Relevant 
Hauling Assets.
    G. Defendants shall maintain, in accordance with sound accounting 
principles, separate, accurate and complete financial ledgers, books 
and records that report on a periodic basis, such as the last business 
day of every month, consistent with past practices, the assets, 
liabilities, expenses, revenues and income of the Relevant Disposal 
Assets and Relevant Hauling Assets.
    H. Except as the ordinary course of business or as is otherwise 
consistent with this Hold Separate Stipulation and Order, defendants 
shall not hire, transfer, terminate, or otherwise alter the salary 
agreements for any USA Waste or WMI employee who, on the date of 
defendants' signing of this Hold Separate Stipulation and Order, 
either: (1) works at a Relevant Disposal Asset or Relevant Hauling 
Assets, or (2) is a member of management referenced in Section V(I) of 
this Hold Separate Stipulation and Order.
    I. Until such time as the Relevant Disposal Assets and Relevant 
Hauling Assets are divested pursuant to the terms of the Final 
Judgment, the Relevant Disposal Assets and Relevant Hauling Assets of 
WMI and USA Waste shall be managed by Donald Chappel. Mr. Chappel shall 
have complete managerial responsibility for the Relevant Disposal 
Assets and Relevant Hauling Assets of WMI and USA Waste, subject to the 
provisions of this Order and the Final Judgment. In the event that Mr. 
Chappel is unable to perform this duties, defendants shall appoint, 
subject to the approval of the United States, after consultation with 
the Relevant States, a replacement within ten (10) working days. Should 
defendants fail to appoint a replacement acceptable to the United 
States, after consultation with the Relevant State, within ten (10) 
working days the United States shall appoint a replacement.
    J. Defendants Shall take no action that would interfere with the 
ability of any trustee appointed pursuant to the Final Judgment to 
complete the divestitures pursuant to the Final Judgment to purchasers 
acceptable to the United States, after consultation with the Relevant 
State.
    K. This Hold Separate Stipulation and Order shall remain in effect 
until consummation of the divestitures contemplated by the Final 
Judgment or until further order of the Court.

VI. Defendants' Expectations

    In consenting to the entry of this Final Judgment, each defendant 
has relied upon, as a material factor, its understanding of the hauling 
routes that it will be required to divest, as set forth in a letter 
from James. R. Weiss and Neal R. Stoll, counsel for defendants, dated 
July 14, 1998, and acknowledged by Anthony E. Harris, Antitrust 
Division, U.S. Department of Justice, counsel for the United States.

    Dated: July 16, 1998.

    For Plaintiff United States of America:

Anthony E. Harris, Esquire
U.S. Department of Justice, Antitrust Division, Litigation II Section, 
Suite 3000, Washington, DC 20005, (202) 307-6583.

For Defendants

[[Page 51129]]

USA Waste Services, Inc. and Dome Merger Subsidiary

James R. Weiss, Esquire
Preston Gates Ellis & Rouvelas Meeds LLP, 1735 New York Avenue, NW, 
Washington, DC 20006-8425, (202) 662-8425.

    J. Defendants shall take no action that would interfere with the 
ability of any trustee appointed pursuant to the Final Judgment to 
complete the divestitures pursuant to the Final Judgment to purchasers 
acceptable to the United States, after consultation with the Relevant 
State.
    K. This Hold Separate Stipulation and Order shall remain in effect 
until consummation of the divestitures contemplated by the Final 
Judgment or until further order of the Court.

VI. Defendants' Expectations

    In consenting to the entry of this Final Judgment, each defendant 
has relied upon, as a material factor, its understanding of the hauling 
routes that it will be required to divest, as set forth in a letter 
from James R. Weiss and Neal R. Stoll, counsel for defendants, dated 
July 14, 1998, and acknowledged by Anthony E. Harris, Antitrust 
Division, U.S. Department of Justice, counsel for the United States.

    Dated: July 16, 1998.

    For Plaintiff United States of America
Anthony E. Harris, Esquire,
U.S. Department of Justice, Antitrust Division, Litigation II Section, 
Suite 3000, Washington, DC 20005, (202) 307-6583.

    For Defendants USA Waste Services, Inc. and Dome Merger 
Subsidiary

James R. Weiss, Esquire,
Preston Gates Ellis & Rouvelas Meeds LLP, 1735 New York Avenue, NW, 
Washington, DC 20006-8425, (202) 662-8425.

    For Plaintiff State of Ohio
Betty D. Montgomery,
Attorney General.

Doreen C. Johnson,
Chief, Antitrust Section, Ohio Attorney General's Office, 30 East Broad 
Street, 16th Floor, Columbus, OH 43215, (614) 446-4328.

    For Plaintiff State of Arizona
Grant Woods,
Attorney General.
    1275 West Washington, Phoenix, AZ 85007, (602) 542-7761

    For Plaintiff State of California
Daniel E. Lungren,
Attorney General.

Barbara Motz,
Supervising Deputy Attorney General, 300 South Spring Street, Los 
Angeles, CA (213) 897-2691.

    For Plaintiff State of Colorado
Gale A. Norton
    For Defendant Waste Management, Inc.
Neal R. Stoll, Esquire,
Skadden, Arpa, Slate, Meagher & Flom, 919 Third Avenue, New York, NY 
10022-3897, (212) 735-3000.

    For Plaintiff State of Ohio
Betty D. Montgomery,
Attorney General.

Doreen C. Johnson,
Assistant Attorney General, Chief, Antitrust Section, Ohio Bar No. 
0024725.
Mitchell L. Gentile, Senior Attorney,
Ohio Bar No. 0022274.
Thomas G. Lingren,
Assistant Attorney General, Ohio Bar No. 0039210.

    Ohio Attorney General's Office, 30 East Broad Street, 16th 
Floor, Columbus, OH 43215, (614) 466-4328

    For Plaintiff State of Arizona
Grant Woods,
Attorney General.
Nancy M. Bonnell,
Assistant Attorney General, Arizona Bar No. 016382, Antitrust Unit, 
Civil Division, 1275 West Washington, Phoenix, AZ 85007, (602) 542-
7711, (602) 542-4801 (facsimile).

    For Defendant Waste Management Services, Inc.
Neal R. Stoll, Esquire,
Skadden, Arps, Slate, Meagher & Flom, 919 Third Avenue, New York, NY 
10022-3897, (212) 735-3000.

    For Plaintiff State of California

Daniel E. Lungren,
Attorney General.
Roderick E. Walston,
Chief Assistant Attorney General.
Barbara Motz,
Acting Assistant Attorney General.
Natalie S. Manzo,
Deputy Attorney General, 300 South Spring Street, Room 5212, Los 
Angeles, CA 90013, (213) 897-2704.

    For Plaintiff State of Colorado
Gale A. Norton,
Attorney General.
Jan Michael Zavislan, Colorado Bar No. 11636,
First Assistant Attorney General.
Maria E. Berkenkotter, Colorado Bar No. 16781,
Assistant Attorney General.
    State Services Building, 1525 Sherman Street, 5th Floor, Denver, 
CO 80203, (303) 866-3613, (303) 866-5691

    For Plaintiff State of Florida

Robert A. Butterworth,
Attorney General.
Lizabeth A. Leeds, Douglas L. Kilby,
Assistant Attorneys General, Antitrust Section, PL-01, The Capitol, 
Tallahassee, FL 32399-1050, (850) 414-3856.

    .For Plaintiff Commonwealth of Kentucky

Albert B. Chandler III,
Attorney General.
David R. Vandeventer,
Assistant Attorney General, Kentucky Bar No. 72790.

    Consumer Protection, 1024 Capital Center Drive, Frankfort, KY 
40601-8204, (502) 573-2200

    For Plaintiff State of Maryland

J. Joseph Curran, Jr.,
Attorney General.
Ellen S. Cooper,
Assistant Attorney General, Chief, Antitrust Division.

John R. Tennis,
Assistant Attorney General.

    Office of the Attorney General 200 St. Paul Place, Suite 17, 
Baltimore, MD 21202-2021, (410) 576-6470

    For Plaintiff State of Michigan

Frank J. Kelley,
Attorney General.
Paul F. Novak,
Assistant Attorney General, Consumer Protection Division, Franchise/
Antitrust Section, P.O. Box 30213, Lansing, MI 48909, (517) 373-7117.
    For Plaintiff State of New York

Dennis C. Vacco,
Attorney General.
Stephen D. Houck,
Assistant Attorney General in Charge.
Richard E. Grimm,
Assistant Attorney General, Antitrust Bureau, Office of the Attorney 
General, State of New York, 120 Broadway, Suite 26-01, New York, NY 
10271, (212) 416-8271

    Of Counsel:
Kay Taylor,
Assistant Attorney General.

    For Plaintiff Commonwealth of Pennsylvania

D. Michael Fisher,
Attorney General.
James A. Donahue, III,
Chief Deputy Attorney General.
Garrett F. Gallia, Terry A. Lupia,
Deputy Attorneys General.

    14th Floor, Strawberry Square, Harrisburg, PA 17120, (717) 787-
4530


[[Page 51130]]


    For Plaintiff State of Texas

Dan Morales,
Attorney General.
Mark Tobey, Kim Van Winkle,
Assistant Attorneys General, P.O. Box 12548, Austin, TX 78711-2548, 
(512) 320-0975.

    For Plaintiff State of Washington

Christine O. Gregoire,
Attorney General.
Jon P. Ferguson,
Senior Counsel.
Marta Lowy,
Assistant Attorney General, Office of the Attorney General, 900 4th 
Avenue, Suite 2000, Seattle, WA 98164-1012, (206) 464-7744.

    For Plaintiff State of Wisconsin

James E. Doyle,
Attorney General of Wisconsin.
Edwin J. Hughes,
Assistant Attorney General, Wisconsin Department of Justice, P.O. Box 
7857, Madison, WI 53707-7857, (608) 267-9487.

    Assistant Attorney General, Wisconsin Department of Justice, 
P.O. Box 7857, Madison, WI 53707-2818, (608) 264-9487

ORDER

    IT IS SO ORDERED by the Court, this ______ day of July, 1998.
----------------------------------------------------------------------
United States District Judge

Final Judgment

    WHEREAS, plaintiffs, the United States of America, the State of 
Ohio, the State of Arizona, the State of California, the State of 
Colorado, the State of Florida, the Commonwealth of Kentucky, the State 
of Maryland, the State of Michigan, the State of New York, the 
Commonwealth of Pennsylvania, the State of Texas, the State of 
Washington, and the State of Wisconsin, and defendants USA Waste 
Services, Inc. (``USA Waste'') and Waste Management, Inc. (``WMI''), by 
their respective attorneys, having consented to the entry of this Final 
Judgment without trial or adjudication of any issue of fact or law 
herein, and without the Final Judgment constituting any evidence 
against or an admission by any party with respect to any issue of law 
or fact herein;
    And Whereas, defendants have agreed to be bound by the provisions 
of this Final Judgment pending its approval by the Court;
    And Whereas, the essence of the Final Judgment is the prompt and 
certain divestiture of the Relevant Disposal Assets and Relevant 
Hauling Assets to assure that competition is not substantially 
lessened;
    And Whereas, plaintiffs require defendants to make certain 
divestitures for the purpose of establishing one or more viable 
competitors in the waste disposal business, the commercial waste 
hauling business, or both in the specified areas;
    And Whereas, defendants have represented to the plaintiffs that the 
divestitures ordered herein can and will be made and that defendants 
will later raise no claims of hardship or difficulty as grounds for 
asking the Court to modify any of the divestiture provisions contained 
below;
    Now, Therefore, before the taking of any testimony, and without 
trial or adjudication of any issue of fact or law herein, and upon 
consent of the parties hereto, it is hereby Ordered, Adjudged, and 
Decreed as follows:

I. Jurisdiction

    This Court has jurisdiction over each of the parties hereto and 
over the subject matter of this action. The Complaint states a claim 
upon which relief may be granted against defendants, as hereinafter 
defined, under Section 7 of the Clayton Act, as amended, 15 U.S.C. 
Sec. 18.

II. Definitions

    As used in this Final Judgment:
    A. USA Waste means defendant USA Waste Services, Inc., a Delaware 
corporation with its headquarters in Houston, Texas, and includes its 
successors and assigns, and its subsidiaries (including Dome Merger 
Subsidiary), divisions, groups, affiliates, directors, officers, 
managers, agents, and employees.
    B. WMI means defendant Waste Management, Inc., a Delaware 
corporation with its headquarters in Oak Brook, Illinois, and includes 
its successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, directors, officers, managers, agents, and employees.
    C. Relevant Disposal Assets means, unless otherwise noted, with 
respect to each landfill or transfer station listed and described 
herein, all tangible asses, including all fee and leasehold and renewal 
rights in the listed landfill or transfer station; the garage and 
related facilities; offices; landfill- or transfer station-related 
assets including capital equipment, trucks and other vehicles, scales, 
power supply equipment, interests, permits, and supplies; and all 
intangible assets of the listed landfill or transfer station, including 
landfill- or transfer station-related customer lists, contracts, and 
accounts, or options to purchase any adjoining property.
    Relevant Disposal Assets, as used herein, includes each of the 
following properties:

1. Landfills and Airspace Disposal Rights

a. Akron/Canton, OH
    WMI's Countywide R&D Landfill, located at 3619 Gracemont Street, 
SW, East Sparta, OH 44626, and known as the Countywide Landfill;
b. Columbus, OH
    USA Waste's Pine Grove Landfill, located at 5131 Drinkle Road, SW, 
Amanda, OH 43102;
c. Denver, CO
    USA Waste's Front Range Landfill, located at 1830 County Road 5, 
Erie, CO 80516-8005; and at purchaser's option, a two-year waste supply 
agreement that would require defendants to dispose of a minimum of 150 
tons/day of waste at the Front Range Landfill, at disposal fees to be 
negotiated between purchaser and defendants;
d. Detroit, MI
    USA Waste' Carleton Farms Landfill, located at 28800 Clark Road, 
New Boston, MI, subject to two conditions, viz., USA Waste's 
obligations to (1) dispose of ash from the Greater Detroit Resource 
Recovery Center's incinerator at a separate monofill cell on this site 
pursuant to an existing contract, and (2) dispose of waste from the 
Greater Detroit Resource Recovery Center's bypass transfer station at 
this landfill, until defendants transfer such obligation to another 
landfill, which they shall use their best efforts to accomplish 
expeditiously;
e. Flint, MI
    USA Waste's Brent Run Landfill, located at Vienna Road, Montrose 
Township, Genesee County, MI;
f. Houston, TX
    (1) USA Waste's Brazoria County Landfill, located at 10310 FM-523, 
Angleton, TX 77515; and
    (2) Airspace disposal rights at WMI's Security Landfill, located at 
19248 Highway 105E, Cleveland, TX, or WMI's Atascocita Landfill, 
located at 2020 Atascocita Road, Humble, TX, or both, pursuant to which 
defendants will sell to one or more purchasers rights to dispose of at 
least 3.0 million tons of waste, over a ten-year period, under the 
following minimum terms and conditions:
    (a) The purchaser (or all purchasers combined), or their 
designee(s), may dispose of up to 360,000 tons of waste/year, or a 
maximum of 1,200 tons of waste/day, at either, or both of, WMI's 
Security or Atascocita landfills. If more than one person purchases the 
airspace

[[Page 51131]]

disposal rights, the minimum annual and daily disposal rates for each 
purchaser shall be specified in its purchase agreement, and the total 
of all purchasers' maximum disposal amounts shall be no less than 
360,000 tons/year and 1,200 tons/day;
    (b) For each purchaser of airspace rights (or their designee), 
defendants must commit to operate the Atascocita Landfill and Security 
Landfill gates, scale houses, and disposal areas under terms and 
conditions no less favorable than those provided to defendants' own 
vehicles or to the vehicles of any municipality in the metropolitan 
Houston area, except as to price and credit terms;
    (c) At the end of the first five years of the agreement, the 
purchaser or purchasers will have been considered to have used a 
minimum of 1.4 million tons of airspace and can have no more than 1.6 
million tons left to use under the purchase agreements. If there is 
more than one purchaser of the airspace, the minimum amounts used 
during the first five years shall be specified in their purchase 
agreements, but the total amount shall be no more than 1.4 million 
tons; and
    (d) At the end of the first seven years of the agreement, the 
purchaser (or purchasers) will have been considered to have used a 
minimum of 2.0 million tons of airspace and can have no more than 1.0 
million tons left to use under the purchase agreements. If there is 
more than one purchaser of the airspace, the minimum amount used during 
the first five years shall be specified in their purchase agreements, 
but the total amount shall be no more than 2.0 million tons;
g. Los Angeles, CA
    USA Waste's Chiquita Canyon Landfill, located at 29201 Henry Mayo 
Drive, Valencia, CA 91355;
h. Louisville, KY
    USA Waste's Valley View Landfill, located at 9120 Sulphur Road, 
Sulphur, KY 40070;
i. Miami, FL
    Airspace disposal rights at USA Waste's Okeechobee Landfill, 
controlled by a subsidiary of USA Waste, and located at 10800 NE 128th 
Avenue, Okeechobee, FL 34972, pursuant to which defendants will sell a 
total of 4.3 million tons of airspace, over a 20-year time period, to 
one or more purchasers, under the following minimum terms and 
conditions:
    (1) The right to dispose of a maximum of 1.8 million tons of South 
Florida Waste, over a 20-year time period, as follows:
    (a) The purchaser (or purchasers) must commit to dispose of no more 
than 600 tons/day, of South Florida Waste;
    (b) The total amount of airspace used in each year may not exceed 
150,000 tons; and
    (2) Three options for additional airspace at Okeechobee Landfill, 
exercisable at the sole discretion of the purchaser of the airspace 
disposal rights, as follows:
    (a) First Options: The right to dispose of an additional 1.0 
million tons of South Florida Waste at the Okeechobee Landfill, for the 
remaining term of the agreement, as follows:
    (i) The amount of airspace used each weekday must be at least 500 
tons, but not more than 800 tons (including tonnage disposed of under 
prior air space commitments); and
    (ii) The amount of airspace used in the year the option is 
exercised, and in each succeeding year over the term of the agreement, 
may not exceed 225,000 tons (including tonnage disposed of under prior 
air space commitments);
    (b) Second Option: Exercisable at any time after the second 
anniversary of the agreement, and after exercise of the first option, 
the right to dispose of an additional 1.0 million tons of South Florida 
Waste at the Okeechobee Landfill, for the remaining term of the 
agreement, as follows:
    (i) The amount of airspace used each weekday must be at least 600 
tons, but not more than 1,000 tons/day (including tonnage disposed of 
under prior air space commitments); and
    (ii) The amount of airspace used in the year Option Two is 
exercised and in each succeeding year of the life of the rights may not 
exceed 300,000 tons (including tonnage disposed of under prior air 
space commitments); and
    (c) Third Option: Exercisable any time after the fifth anniversary 
of the agreement, and after exercise of the second option, the right to 
dispose of an additional 500,000 tons of South Florida Waste, for the 
remaining term of the agreement, as follows:
    (i) The amount of airspace used must be at least 600 tons/weekday, 
but may not exceed 1,100 tons/weekday, (including tonnage disposed of 
under prior air space commitments);
    (ii) The amount of airspace used in the year the third option is 
exercised, and in each succeeding year of the life of the rights may 
not exceed 300,000 tons/year (including tonnage disposed of under prior 
air space commitments); provided, that in any event,
    (d) The Okeechobee Landfill Rights shall expire when the purchaser 
has used the maximum tonnages available under the rights and exercised 
options, or twenty years from the date of purchase of the rights, 
whichever is sooner; and
    (e) For each purchaser of airspace rights (or its designee), 
defendants must commit to operate the Okeechobee Landfill, and its 
gate, scale house, and disposal area under terms and conditions no less 
favorable than those provided to defendant's own vehicles or to the 
vehicles of any municipality in Florida, except as to price and credit 
terms;
j. Milwaukee, WI
    USA Waste's Kestrel Hawk Landfill, located at 1989 Oakes Road, 
Racine, WI 53406; and WMI's Mallard Ridge Landfill, located at W. 8470 
State Road 11, Delavan, WI 53115;
k. New York, NY/Philadephia, PA
    WMI's Modern Landfill & Recycling, located at 4400 Mt. Piscah Road, 
York, PA 17402, and know as the Modern Landfill;
l. Northeast Michigan
    USA Waste's Whitefeather Landfill, located at 2401 Whitefeather 
Road, Pinconning, MI; and Elk Run Sanitary Landfill, located at 20676 
Five Mile Highway, Onaway, MI;
m. Pittsburgh, PA
    WMI's Green Ridge Landfill, located at 717 East Huntingdon Landfill 
Road, Scottdale, PA 15683, and variously known as the Green Ridge 
Landfill, the Y&S Landfill, or the Greenridge Reclamation Landfill;
n. Portland, OR
    USA Waste's North WASCO Landfill, located at 2550 Steele Road, The 
Dalles, OR 97058; and

2. Transfer Stations, Disposal Rights and Throughput Agreements

a. Akron/Canton, OH
    Throughput disposal rights of a maximum of 400 tons/day of waste, 
for a ten-year time period, at WMI's Akron Central Transfer Station, 
located at 389 Fountain Street, Akron, OH, under the following terms 
and conditions:
    (1) The purchaser (or its designee) can deliver waste to the Akron 
Central Transfer Station for processing and, at the purchaser's option, 
load the processed waste into the purchaser's (or its designee's) 
vehicles for disposal;
    (2) For each purchaser of such disposal rights (or its designee), 
defendants must commit to operate the listed Akron Central Transfer 
Station's gate, scale house, and disposal area

[[Page 51132]]

under terms and conditions no less favorable than those provided to 
defendants' own vehicles or to the vehicles of any municipality in 
Ohio, except as to price and credit terms;
b. Baltimore, MD
    Disposal rights of at least 600 tons of waste/day, pursuant to 
which defendants will sell to one or more purchasers rights to dispose, 
for a five-year time period, under the following terms and conditions:
    (1) The purchaser(s) or its designee(s) may dispose of waste at any 
one or any combination of the following facilities, as specified in its 
purchase agreement: Southwest Resource Recovery Facility (known as 
Baltimore RESCO or BRESCO), located at 1801 Annapolis Road, Baltimore, 
MD 21230; Baltimore County Resource Recovery Facility, located at 10320 
York Road, Cockeysville, MD; Western Acceptance Facility, located at 
3310 Transway Road, Baltimore, MD; or Annapolis Junction Transfer 
Station, located at 8077 Brock Bridge Road, Jessup, MD 20794. If more 
than one person purchases the disposal rights, the minimum daily 
disposal rates, and the total of all purchasers' maximum disposal 
amounts at all facilities specified shall be no less than 600 tons/day;
    (2) For each purchaser of disposal rights (or its designee), 
defendants must commit to operate the listed Baltimore, MD area 
facilities' gates, scale houses, and disposal areas under terms and 
conditions no less favorable than those provided to defendants' own 
vehicles or to the vehicles of any municipality in Maryland, except as 
to price and credit terms;
c. Cleveland, OH
    At purchaser's option, either USA Waste's Newburgh Heights Transfer 
Station, located at 3227 Harvard Road, Newburgh Heights, OH 44105 (and 
known as the Harvard Road Transfer Station); or all of WMI's right, 
title and interest in the Strongsville Transfer Station, located at 
16099 Foltz Industrial Parkway, Strongsville, OH; provided, however, 
that the City of Strongsville, owner of the transfer station, approves 
such sale or assignment. Defendants will exercise their best efforts to 
secure the assignment to the purchaser of all their rights, title and 
their interests in the Strongsville Transfer Station, and in the event 
the purchaser selects Strongsville, defendants will not reacquire any 
right, title or interest in the Strongsville transfer station. If the 
contract is not assigned, defendants will enter into a disposal rights 
agreement with the purchaser (or purchasers), which will provide, in 
effect, that the purchaser(s) will enjoy all disposal rights and 
privileges now enjoyed by defendants at the Strongsville Transfer 
Station, and that defendants will operate the facility's gate, scale 
house, and disposal areas under terms and conditions no less favorable 
than those provided to defendants' own vehicles or to the vehicles of 
any municipality in Ohio, except as to price and credit terms;
d. Columbus, OH
    WMI's Reynolds Road Transfer Station, located at 805 Reynolds 
Avenue, Columbus, OH 43201;
e. Detroit, MI
    WMI's Detroit Transfer Station, located at 12002 Mack Avenue, 
Detroit, MI 48215;
f. Houston, TX
    USA Waste's Hardy Road Transfer Station, located at 18784 East 
Hardy, Houston, TX;
g. Louisville, KY
    USA Waste's Poplar Level Road Transfer Station, located at 4446 
Poplar Level Road, Louisville, KY:
h. Miami, FL
    All USA Waste's right, title, and interest in the Reuters Transfer 
Station Rights, as conveyed to Chambers Waste Systems of Florida, a 
subsidiary of USA Waste, pursuant to the Final Judgment in United 
States v. Reuter Recycling of Florida, Inc., 1996-1 Trade Cas. (CCH) 
para. 71,353 (D.D.C. 1996), a copy of which is attached as Exhibit A;
i. New York, NY
    (1) WMI's SPM Transfer Station, located at 912 East 132nd Street, 
Bronx, NY 10452, and all rights and interest, legal or otherwise, that 
WMI now enjoys, has had or made use of out of the SPM Transfer Station, 
to deliver waste by truck to rail siding at the Oak Point Rail Yard in 
the Bronx, NY, and at the Harlem River Yards facility, located at St. 
Ann's and Lincoln Avenue at 132nd Street, Bronx, NY 10454;
    (2) All right, title, and interest in USA Waste's pending 
application to construct and operate a waste transfer station located 
at 2 North 5th Street, Brooklyn, NY 11211, and known as the 
Nekboh Transfer Station; and
    (3) USA Waste's all City Transfer Station, located at 246-252 
Plymouth Street, Brooklyn, NY 11202; and
    (4) WMI's Brooklyn,Transfer Station, located at 485 Scott Avenue, 
Brooklyn, NY 12222, but only in the event that USA Waste's Nekboh 
Transfer Station has not been licensed or permitted to accept waste 
within one year from the date of entry of the Final Judgment; and
j. Philadelphia, PA
    USA Waste's Girard Point Transfer Station, located at 3600 South 
25th Streets, Philadelphia, PA 19145; and USA Waste's Quick 
Way Inc. Municipal Waste Transfer Station, located at SE Corner, Bath 
and Orthodox Streets, Philadelphia, PA 19137, subject to the conditions 
that (1) the existing City of Philadelphia waste contract is 
transferred to a WMI transfer station, which defendants must use their 
best efforts to accomplish, and (2) until such transfer is effected, 
USA Waste will be granted through put capacity at the Quick Way 
Transfer Station to handle this contract.
    D. ``Relevant Hauling Assets,'' unless otherwise noted, means with 
respect to each commercial waste collection route or other hauling 
asset described herein, all tangible assets, including capital 
equipment, trucks and other vehicles, containers, interest, permits, 
supplies [except real property and improvements to real property (i.e., 
buildings)] and it includes all intangible assets, including hauling-
related customer lists, contract, and accounts.
    Relevant hauling Assets, as used herein, includes the assets in the 
following locations:
1. Akron, OH
    USA Waste's and American Waste Corporation's front-end loader truck 
(``FEL'') commercial routes that serve the City of Akron and Summit 
County, Ohio;
2. Allentown, PA
    WMI's FEL commercial routes that serve the cities of Allentown and 
Northampton and Lehigh County, PA;
3. Cleveland, OH
    WMI's FEL commercial routes that serve the City of Cleveland and 
Cuyahoga County, Ohio (not including the northwestern quadrant);
4. Columbus, OH
    WMI's FEL commercial routes that serve Franklin County, Ohio;
5. Denver, CO
    USA Waste's FEL commercial routes that serve the City of Denver, 
and Denver and Arapahoe County, CO;
6. Detroit, MI
    WMI's FEL commercial routes that serve the City of Detroit and 
Wayne County, MI;

[[Page 51133]]

7. Houston, TX
    WMI's FEL commercial routes that serve the City of Houston, the 
Dickinson area, and Harris County, TX;
8. Louisville, KY
    USA Waste's FEL commercial routes that serve the City of Louisville 
and Jefferson Country, KY;
9. Pittsburgh, PA
    WMI's FEL commercial routes that serve Allegheny County and 
Westmoreland County, PA, and the garage facility (real estate and 
improvements) located at the Y&S Landfill;
10. Portland, OR
    WMI's FEL commercial routes that serve the City of Portland, OR;
11. Tucson, AZ
    USA Waste's FEL commercial routes that serve the City of Tucson and 
Pima County, AZ; and
12. Gainesville, FL
    WMI's FEL commercial routes that serve Alachua County, FL.
    E. Hauling means the collection of waste from customers and the 
shipment of the collected waste to disposal sites. Hauling, as used 
herein, does not include collection of roll-off containers.
    F. Waste means municipal solid waste.
    G. Disposal means the business of disposing of waste into approved 
disposal sites.
    H. Relevant Area means the county in which the Relevant Hauling 
Asset or Relevant Disposal Assets are located and any adjacent city or 
county, except with respect to the Modern Landfill [see Section 
II(C)(1)(k)], for which the Relevant Area means Philadelphia, PA, and 
New York, NY.
    I. Relevant State means the state in which the Relevant Disposal 
Assets or Relevant Hauling Assets are located, provided however, that 
stat is a party to this Final Judgment. With respect to the Modern 
Landfill [see Section II(C)(1)(k)], the Relevant State means the 
Commonwealth of Pennsylvania and the State of New York. With respect to 
Section VII, the Relevant State means each state in which the disposal 
or hauling assets to be acquired are located, provided that state is a 
party to this Final Judgment.
    J. South Florida Waste means waste collected, or delivered directly 
from a transfer station located, in Broward, Dade or Monroe County, FL.

III. Applicability

    A. The provisions of this Final Judgment apply to defendants, their 
successors and assigns, subsidiaries, directors, officers, managers, 
agents, and employees, and all other persons in active consent or 
participation with any of them who shall have received actual notice of 
this Final Judgment by personal service or otherwise.
    B. Defendants shall require, as a condition of the sale or other 
disposition of all or substantially all of its assets, or of a lesser 
business unit that includes defendants' hauling or disposal businesses 
in any Relevant Area, that the acquiring party or parties agree to be 
bound by the provisions of this Final Judgment.

IV. Divestitures

    A. With the exception of the Brooklyn Transfer Station (Section 
II(C)(2)(i)(4)), defendants are hereby ordered and directed, in 
accordance with the terms of this Final Judgment, within one hundred 
and twenty (120) calendar days after the filing of the Complaint in 
this matter, or five (5) days after notice of the entry of this Final 
Judgment by the Court, whichever is later, to sell all Relevant 
Disposal Assets and Relevant Hauling Assets as viable, ongoing 
businesses to a purchaser or purchasers acceptable to the United 
States, in its sole discretion, after consultation with the Relevant 
State.
    B. In the event that USA Waste's Nekboh Transfer Station has not 
been licensed or permitted to accept waste within one year from the 
date of entry of the Final Judgment, defendants are hereby ordered and 
directed, in accordance with the terms of Sections II, IV, V and VI of 
this Final Judgment, within one hundred and twenty (120) calendar days 
after such anniversary date, to sell WMI's Brooklyn Transfer Station, 
located at 485 Scott Avenue, Brooklyn, NY 12222, as a viable, ongoing 
businesses to a purchaser or purchasers acceptable to the United 
States, in its sole discretion, after consultation with the Relevant 
State.
    C. Defendants shall sue their best efforts to accomplish the 
diversitures ordered by this Final Judgment as expenditously and timely 
as possible. The United States, in its sole discretion, after 
consultation with the Relevant State, may extend the time period for 
any divestiture an additional period of time, not to exceed sixty (60) 
calendar days.
    D. In accomplishing the divestitures ordered by this Final 
Judgment, defendants promptly shall make known by usual and customary 
means, the availability of the Relevant Disposal Assets and the 
Relevant Hauling Assets. Defendants shall inform any person making an 
inquiry regarding a possible purchase that the sale is being made 
pursuant to this Final Judgment and provide such person with a copy of 
this Final Judgment. Defendants shall also offer to furnish to all bona 
fide prospective purchasers, subject to customary confidentiality 
assurances, all information regarding the Relevant Disposal Assets and 
Relevant Hauling Assets customarily provided in a due diligence process 
except such information subject to attorney-client privilege or 
attorney work-product privilege. Defendants shall make available such 
information to the plaintiffs at the same time that such information is 
made available to any other person.
    E. Defendants shall not interfere with any negotiations by any 
purchaser to employ any USA Waste (or former WMI) employee who works 
at, or whose primary responsibility concerns, any disposal or hauling 
business that is part of the Relevant Disposal Assets or Relevant 
Hauling Assets.
    F. Defendants shall permit prospective purchasers of the Relevant 
Disposal Assets or Relevant Hauling Assets to have access to personnel 
and to any and all environmental, zoning, and other permit documents 
and information, and to make inspection of the Relevant Disposal Assets 
and Relevant Hauling Assets and of any and all financial, operational, 
or other documents and information customarily provided as part of a 
due diligence process.
    G. With the exception of the facilities described in Sections 
II(C)(2)(e), (h) and (i)(2), defendants shall warrant to each purchaser 
of Relevant Disposal Assets or Relevant Hauling Assets that each asset 
will be operational on the date of sale.
    H. Defendants shall not take any action, direct or indirect, that 
will impede in any way the operation of the Relevant Disposal Assets or 
Relevant Hauling Assets.
    I. Defendants shall warrant to each purchaser of Relevant Disposal 
Assets or Relevant Hauling Assets that there are no material defects in 
the environmental, zoning, or other permits pertaining to the operation 
of each asset, and that defendants will not undertake, directly or 
indirectly, following the divestiture of each asset, any challenges to 
the environmental, zoning, or other permits or applications for permits 
or licenses pertaining to the operation of the asset.
    J. Unless the United States, after consultation with the Relevant 
State, otherwise consents in writing, the divestitures pursuant to 
Section IV, or by trustee appointed pursuant to Section V of this 
Judgment, shall

[[Page 51134]]

include all Relevant Disposal Assets and Relevant Hauling Assets and be 
accomplished by selling or otherwise conveying each asset to a 
purchaser in such a way as to satisfy the United States, in its sole 
discretion, after consultation with the Relevant State, that the 
Relevant Disposal Assets or Relevant Hauling Assets can and will be 
used by the purchaser as part of a viable, ongoing business or 
businesses engaged in waste disposal or hauling. The divestitures, 
whether pursuant to Section IV or Section V of this Final Judgment, 
shall be made to a purchaser (or purchasers) for whom it is 
demonstrated to the United States sole satisfaction, after consultation 
with the Relevant State, that: (1) the purchaser(s) has the capability 
and intent of competing effectively in the waste disposal or hauling 
business in the Relevant Area; (2) the purchaser(s) has the managerial, 
operational, and financial capability to compete effectively in the 
waste disposal or hauling business in the Relevant Area; and (3) none 
of the terms of any agreement between the purchaser and defendants 
gives any defendant the ability unreasonably to raise the purchaser's 
costs, lower the purchaser's efficiency, or otherwise interfere in the 
ability of the purchaser to compete effectively in the Relevant Area.
    K. A purchaser of any Relevant Disposal Assets or Relevant Hauling 
Assets under this Final Judgment must demonstrate to the satisfaction 
of the United States, after consultation with the Relevant State, that 
the purchaser will comply with any and all applicable federal, state 
and local environmental and licensing laws.
    L. Defendants may enter into an agreement, after review and 
approval of the United States, in its sole discretion, after 
consultation with the Relevant State, with a purchaser or purchasers of 
the Chiquita Canyon, Brazoria or Carleton Farms landfills (see Sections 
II (C)(1)(g), (f) and (d) for disposal of commercially acceptable waste 
collected or transferred from defendants' own route operations.

V. Appointment of Trustee

    A. In the event that defendants have not sold the Relevant Disposal 
Assets or Relevant Hauling Assets within the time specified in Section 
IV of this Final Judgment, the Court shall appoint, on application of 
the United States, a trustee selected by the United States, to effect 
the divestiture of each Relevant Disposal Asset or Relevant Hauling 
Asset not sold.
    B. After the appointment of a trustee becomes effective, only the 
trustee shall have the right to sell the Relevant Disposal Assets or 
Relevant Hauling Assets described in Sections II (C) and (D) of this 
Final Judgment. The trustee shall have the power and authority to 
accomplish any and all divestitures at the best price than obtainable 
upon a reasonable effort by the trustee, subject to the provisions of 
Section IV, VI, and IX of this Judgment, and shall have such others 
powers as the Court shall deem appropriate. Subject to Section V(C) of 
this Judgment, the trustee shall have the power and authority to hire 
at the cost and expense of defendants any investment bankers, 
attorneys, or other agents reasonably necessary in the judgment of the 
trustee to assist in the divestitures, and such professionals and 
agents shall be accountable solely to the trustee. To assist in the 
sale of the Brent Run Landfill, described in Section II(C)(1)(e) of 
this Judgment, the trustee also shall have the power and authority to 
commit defendants to supply waste from defendant's routes in the 
Relevant Area to that landfill for up to a five-year time period at the 
best disposal price than obtainable upon reasonable effort by the 
trustee. The trustee shall have the power and authority to accomplish 
the divestitures at the earliest possible time to a purchaser or 
purchasers acceptable to the United States, in its sole discretion, 
after consultation with the Relevant State, and shall have such other 
powers as this Court shall deem appropriate. Defendants shall not 
object to a sale by the trustee on any ground other than the trustee's 
malfeasance. Any such objections by defendants must be conveyed in 
writing to the United States and the Relevant State and trustee with 
ten (10) calendar days after the trustee has provided the notice 
required under Section VI of this Final Judgment.
    C. The trustee shall serve at the cost and expense of defendants, 
on such terms and conditions as the Court may prescribe, and shall 
account for all monies derived from the sale of each Relevant Disposal 
Asset or Relevant Hauling Asset sold by the trustee and all costs and 
expenses so incurred. After approval by the Court of the trustee's 
accounting, including fees for its services and those of any 
professionals and agents retained by the trustee, all remaining money 
shall be paid to defendants and the rust shall then be terminated. The 
compensation of such trustee and of any professionals and agents 
retained by the trustee shall be reasonable in light of the value of 
the divested business and based on a fee arrangement providing the 
trustee with an incentive based on the price and terms of the 
divestiture and the speed with which it is accomplished.
    D. Defendants shall use their best efforts to assist the trustee in 
accomplishing the required divestitures, including best efforts to 
effect all necessary regulatory approvals. The trustee and any 
consultants, accountants, attorneys, and other persons retained by the 
trustee shall have full and complete access to the personnel, books, 
records, and facilities of the businesses to be divested, and 
defendants shall develop financial or other information relevant to the 
businesses to be divested customarily provided in a due diligence 
process as the trustee may reasonably request, subject to customary 
confidentiality assurances. Defendants shall permit bona fide 
prospective purchasers of each Relevant Disposal Asset or Relevant 
Hauling Asset to have reasonable access to personnel and to make such 
inspection of physical facilities and any and all financial, 
operational or other documents and other information as may be relevant 
to the divestitures required by this Final Judgment.
    E. After its appointment, the trustee shall file monthly reports 
with the parties and the Court setting forth the trustee's efforts to 
accomplish the divestitures ordered under this Final Judgment; 
provided, however, that to the extent such reports contain information 
that the trustee deems confidential, such reports shall not be filed in 
the public docket of the court. Such reports shall include the name, 
address and telephone number of each person who, during the preceding 
month, made an offer to acquire, expressed an interest in acquiring, 
entered into negotiations to acquire, or was contacted or made an 
inquiry about acquiring, any interest in the business to be divested, 
and shall describe in detail each contact with any such person during 
that period. The trustee shall maintain full records of all efforts 
made to sell the businesses to be divested.
    F. If the trustee has not accomplished such divestitures within six 
(6) months after its appointment, the trustee thereupon shall file 
promptly with the Court a report setting forth (1) the trustee's 
efforts to accomplish the required divestitures, (2) the reasons, in 
the trustee's judgment, why the required divestitures have not been 
accomplished, and (3) the trustee's recommendations; provided, however, 
that to the extent such reports contain information that the trustee 
deems confidential, such reports shall not be filed in the public 
docket of the Court. The trustee shall at the same time

[[Page 51135]]

furnish such report to the parties, who shall each have the right to be 
heard and to make additional recommendations consistent with the 
purpose of the trust. The Court shall enter thereafter such orders as 
it shall deem appropriate in order to carry out the purpose of the 
trust which may, if necessary, include extending the trust and the term 
of the trustee's appointment by a period requested by the United 
States.

VI. Notice of Proposed Divestitures

    Within two (2) business days following execution of a definitive 
agreement, contingent upon compliance with the terms of this Final 
Judgment, to effect, in whole or in part, any proposed divestiture 
pursuant to Sections IV or V of this Final Judgment, defendants or the 
trustee, whichever is then responsible for affecting the divestiture, 
shall notify the United States and the Relevant State of the proposed 
divestiture. If the trustee is responsible, it shall similarly notify 
defendants. The notice shall set forth the details of the proposed 
transaction and list the name, address, and telephone number of each 
person not previously identified who offered to, or expressed an 
interest in or a desire to, acquire any ownership interest in the 
business to be divested that is the subject of the binding contract, 
together with full details of same. Within fifteen (15) calendar days 
of receipt by the United States and the Relevant State of such notice, 
the United States, in its sole discretion, after consultation with the 
Relevant State, may request from defendants, the proposed purchaser, or 
any other third party additional information concerning the proposed 
divestiture and the proposed purchaser. Defendants and the trustee 
shall furnish any additional information requested from them within 
fifteen (15) calendar days of the receipt of the request, unless the 
parties shall otherwise agree. Within thirty (30) calendar days after 
receipt of the notice [or within twenty (20) calendar days after the 
United States and the Relevant State have been provided the additional 
information requested from defendants, the proposed purchaser, and any 
third party, whichever is later], the United States, after consultation 
with the Relevant State, shall provide written notice to defendant and 
the trustee, if there is one, stating whether or not it objects to the 
proposed divestiture. If the United States provides written notice to 
defendants (and the trustee, if applicable) that it does not object, 
then the divestiture may be consummated, subject only to defendants' 
limited right to object to the sale under Section V(B) of this Final 
Judgment. Upon objection by the United States, a divestiture proposed 
under Section IV or Section V of this Final Judgment shall not be 
consummated. Upon objection by defendants under the provision in 
Section V(B), a divestiture proposed under Section V shall not be 
consummated unless approved by the Court.

VII. Notice of Future Acquisitions

    A. Defendants shall provide each Relevant State with 30 days' 
written notice (which period may be shortened by permission of the 
Relevant State) before acquiring, directly or indirectly, any interest 
in any business, assets (other than in the ordinary course of 
business), capital stock, or voting securities of any person that, at 
any time during the twelve (12) months immediately preceding such 
acquisition, was engaged in waste disposal or small containerized solid 
waste hauling in any area listed in Section VII(B), where that person's 
annual revenues from waste disposal or small containerized solid waste 
hauling in the area were in excess of $500,000 annually, or its total 
revenues were in excess of $,000,000 annually.
    B. The notice provisions set forth in Section VII (A) above apply 
whenever defendants seek to acquire any interest in any business, 
assets (other than in the ordinary course of business), capital stock, 
or voting securities of any person that was engaged in waste disposal 
or small containerized solid waste hauling in any of the following 
areas:

------------------------------------------------------------------------
                                 Area of which defendants must provide
        Relevant state              relevant state notice of future
                                              acquisitions
------------------------------------------------------------------------
Arizona......................  Pima Co. (hauling and disposal).
California...................  Los Angeles and Riverside (hauling and
                                disposal); Ventura and Orange Co.
                                (disposal only).
Colorado.....................  Boulder and Denver Co. (hauling and
                                disposal).
Florida......................  Brevard, Alachua, Marion, Orange,
                                Osceola, Seminole, Lee, Charlotte,
                                Sarsota, Putnam, Volusia and Flagler Co.
                                (hauling and disposal).
Kentucky.....................  Jefferson and Oldham Co. (hauling and
                                disposal).
Maryland.....................  Baltimore City, Baltimore, Anne Arundel,
                                Hartford, Carroll, Howard, Montgomery,
                                and Prince George's Co. (hauling and
                                disposal).
Michigan.....................  Wayne, Macomb, and Oakland Co. (hauling
                                and disposal); Genessee, Shiiawassee,
                                Saginaw, Bay, Midland, Wexford, Manistee
                                and Montmorency Co. (disposal only).
New York.....................  New York, Bronx, Kings, Queens, and
                                Richmond Co. (disposal only).
Ohio.........................  Ashtabula, Cuyahoga, Delaware, Fairfield,
                                Franklin, Geauga, Lake Licking, Lorain,
                                Lucas, Mahoning, Medina, Pickaway,
                                Portage, Stark, Summit, Trumbull, and
                                Wood Co. (hauling and disposal);
                                Carroll, Columbiana, Coshocton, Holmes,
                                Knox, Madison, Tuscarawas, Union and
                                Wayne Co. (disposal only).
Pennsylvania.................  Allegheny, Westmoreland, Washington,
                                Beaver, Butler, Lehigh, Northampton,
                                Dauphin, Cumberland, and Perry Co.
                                (hauling and disposal); Philadelphia,
                                Bucks, Montgomery, and Delaware Co.
                                (disposal only).
Texas........................  Brazoria, Chambers, Ft. Bend, Galveston,
                                Harris, Liberty, Montgomery, Walker and
                                Waller Co. (hauling and disposal).
Washington...................  Cowlitz and Clark Co. (hauling and
                                disposal).
Wisconsin....................  Milwaukee, Waukesha, Racine, Washington,
                                Kenosha, Ozaukee, Walworth, Jefferson
                                and Dane Co. (disposal only).
------------------------------------------------------------------------

    C. For purposes of this Section VII, the term ``small containerized 
solid waste hauling'' means the provision of solid waste hauling 
service to commercial customers by providing the customer with a one to 
ten cubic yard container, which is picked up mechanically using a 
frontload, rearload or sideload truck, and excludes hand pick-up 
service, and service using a compactor attached to or part of a 
container.

[[Page 51136]]

VIII. Defendants' Additional Obligations

    Defendants are hereby ordered and directed to, in accordance with 
the terms of this Final Judgment:
    A. Offer to extend, for an additional ten-year time period, the 
Solid Waste Service Agreement, dated August 8, 1996, by and between the 
Northeast Maryland Waste Disposal Authority and USA Waste's subsidiary, 
Garnet of Maryland, Inc. (attached hereto as Exhibit B), for the 
disposal of Anne Arundel County, MD and Howard County, MD waste at the 
Annapolis Junction Transfer Station;
    B. Use their best efforts, prior to its divestiture, to obtain any 
and all licenses and permits to open and operate USA Waste's Nekboh 
Transfer Station, described in Section II(C)(2)(i)(2); and for a five-
year period following such divestiture, to cooperate and assist the 
purchaser in obtaining any and all licenses or permits required to 
operate Nekboh Transfer Station and to refrain from opposing any 
application by the purchaser to obtain a license or permit to expand 
the Nekboh Transfer Station;
    C. For a one-year period following entry of this Final Judgment, 
refrain from opposing any application by any person for permit or 
license to operate any waste transfer station in any borough of the 
City of New York, NY;
    D. For a five-year period following entry of this Final Judgment, 
refrain from opposing any application by any person to obtain a license 
or permit to expand the remaining capacity or the average daily 
capacity of the Emerald Park Landfill, Glacier Ridge Landfill, or 
Valley Meadows Landfill, in the Greater Milwaukee, WI area;
    E. Refrain from reacquiring any interest in any Relevant Disposal 
Assets or Relevant Hauling Assets divested pursuant to the terms of 
this Final Judgment, without prior written notice to, and written 
consent of, the Untied States and the Relevant State;
    F. Refrain from conditioning the sale of any landfill pursuant to 
this Final Judgment on any understanding, agreement or commitment, 
written or understood, that the purchaser (or purchasers) will agree to 
sell airspace or otherwise permit defendants to dispose of waste in 
that landfill; provided, however, that USA Waste's Carleton Farms 
Landfill may be divested subject to USA Waste's obligation to dispose 
of ash from the Greater Detroit Resource Recovery Center's incinerator 
at a separate monofill cell on the Carleton Farms Landfill site;
    G. Refrain from taking any action to enforce any agreement or 
understanding that would prohibit any person from competing in Alachua 
or Marion County, FL: provided, however, that this provision shall not 
apply to a current or former employee of defendants (other than any 
employee who may be responsible in any way for route operations subject 
to divestiture under Sections II(D)(12), IV and V of this Judgment); 
and
    H. Provide access to the gate, scale house and disposal area of the 
WMI Tucson transfer station, located at 5200 West Ina, Tucson, AZ, 
under terms and conditions no less favorable than those provided to 
defendants' own vehicles or to the vehicles of any county or 
municipality in Arizona.

IX. Affidavits

    A. Within twenty (20) calendar days of the filing of the Final 
Judgment in this matter and every thirty (30) calendar days thereafter 
until the divestiture has been completed whether pursuant to Section IV 
or Section V of this Final Judgment, defendants shall deliver to 
plaintiffs an affidavit as to the fact and manner of compliance with 
Sections IV or V of this Final Judgment. Each such affidavit shall 
include, inter alia, the name, address, and telephone number of each 
person who, at any time after the period covered by the last such 
report, made an offer to acquire, expressed an interest in acquiring, 
entered into negotiations to acquire, or was contacted or made an 
inquiry about acquiring, any interest in the businesses to be divested, 
and shall described in detail each contact with any such person during 
that period. Each such affidavit shall also include a description of 
the efforts that defendants have taken to solicit a buyer for any and 
all Relevant Disposal Assets and Relevant Hauling Assets and to provide 
required information to prospective purchasers, including the 
limitations, if any, on such information. Assuming the information set 
forth in the affidavit is true and complete, any objection by the 
United States, after consultation with the Relevant State, to 
information provided by defendants, including limitations on 
informations shall be made within fourteen (14) days of receipt of such 
affidavit.
    B. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, defendants shall deliver to plaintiffs an affidavit 
which describes in detail all actions defendants have taken and all 
steps defendants have implemented on an on-going basis to preserve the 
Relevant Disposal Assets and Relevant Hauling Assets pursuant to 
Section X of this Final Judgment and the Hold Separate Stipulation and 
Order entered by the Court. The affidavit also shall describe, but not 
be limited to, defendants' efforts to maintain and operate each 
Relevant Disposal Asset and Relevant Hauling Asset as a viable active 
competitor; to maintain separate management, staffing, sales, marketing 
and pricing of each asset; and to maintain each asset in operable 
condition at current capacity configurations. Defendants shall deliver 
to plaintiffs an affidavit describing any changes to the efforts and 
actions outlined in defendants' earlier affidavit(s) filed pursuant to 
this Section within fifteen (15) calendar days after any such change 
has been implemented.
    C. For a one-year period following the completion of each 
divestiture, defendants shall preserve all records of any and all 
efforts made to preserve the Relevant Disposal Assets and Relevant 
Hauling Assets that were divested and to effect the ordered 
divestitures.

X. Hold Separate Order

    Until the divestitures required by the Final Judgment have been 
accomplished, defendants shall take all steps necessary to comply with 
the Hold Separate Stipulation and Order entered by this Court. 
Defendants shall take no action that would jeopardize the sale of any 
Relevant Disposal Asset or Relevant Hauling Asset.

XI. Financing

    Defendants are ordered and directed not to finance all or any part 
of any acquisition by any person made pursuant to Sections IV or V of 
this Final Judgment.

XII. Compliance Inspection

    For purposes of determining or securing compliance with the Final 
Judgment and subject to any legally recognized privilege, from time to 
time:
    A. Duly authorized representatives of the United States Department 
of Justice, upon written request of the Attorney General or of the 
Assistant Attorney General in charge of the Antitrust Division, or upon 
written request of duly authorized representatives of the Attorney 
General's Office of any other plaintiff, and on reasonable notice to 
defendants made to their principal offices, shall be permitted:
    1. Access during office hours of defendants to inspect and copy all 
books, ledgers, accounts, correspondence, memoranda, and other records 
and documents in the possession or under the control of defendants, who 
may have counsel present, relating to the matters contained in this 
Final Judgment and

[[Page 51137]]

the Hold Separate Stipulation and Order; and
    2. Subject to the reasonable convenience of defendants and without 
restraint or interference from them, to interview, either informally or 
on the record, their officers, employees, and agents, who may have 
counsel present, regarding any such matters.
    B. Upon the written request of the Attorney General or of the 
Assistant Attorney General in charge of the Antitrust Division, or upon 
the written request of the Attorney General's Office or any other 
plaintiff, defendants shall submit such written reports, under oath if 
requested, with respect to any matter contained in the Final Judgment 
and the Hold Separate Stipulation and Order.
    C. No information or documents obtained by the means provided in 
Sections VII or X of this Final Judgment shall be divulged by a 
representative of the plaintiffs to any person other than a duly 
authorized representative of the Executive Branch of the United States, 
or the Attorney General's Office of any other plaintiff, except in the 
course of legal proceedings to which the United States or any other 
plaintiff is a party (including grand jury proceedings), or for the 
purpose of securing compliance with this Final Judgment, or as 
otherwise required by law.
    D. If at the time information or documents are furnished by 
defendants to plaintiffs, defendants represent and identify in writing 
the material in any such information or documents to which a claim of 
protection may be asserted under Rule 26(c)(7) of the Federal Rules of 
Civil Procedure, and defendants mark each pertinent page of such 
material, ``Subject to claim of protection under Rule 26(c)(7) of the 
Federal Rules of Civil Procedure,'' then ten (10) calendar days notice 
shall be given by plaintiffs to defendants prior to divulging such 
material in any legal proceeding (other than a grand jury proceeding) 
to which defendants are not a party.

XIII. Retention of Jurisdiction

    Jurisdiction is retained by this Court for the purpose of enabling 
any of the parties to this Final Judgment to apply to this Court at any 
time for such further orders and directions as may be necessary or 
appropriate for the construction or carrying out of this Final 
Judgment, for the modification of any of the provisions hereof, for the 
enforcement of compliance herewith, and for the punishment of any 
violations hereof.

XIV. Termination

    Unless this Court grants an extension, this Final Judgment will 
expire upon the tenth anniversary of the date of its entry.

XV. Public Interest

    Entry of this Final Judgment is in the public interest.

    Dated ____________________ 1998.

----------------------------------------------------------------------
United States District Judge

Exhibit A--Final Judgment, US v. Reuter Recycling of Florida, Inc.

In the United States District Court for the District of Columbia

    United States of America and State of Florida, by and through 
its Attorney General, Plaintiffs, v. Reuter Recycling of Florida, 
Inc., and Waste Management Inc. of Florida, Defendants Civil Action 
No.: 951982. Filed: June 25, 1999. Entered: January 22, 1996.

Final Judgment

    Whereas, Plaintiffs, United States of America (hereinafter 
``United States'') and the State of Florida (hereinafter 
``Florida''), having filed their Complaint in this action on October 
20, 1995, and Plaintiffs and Defendants, by their respective 
attorneys, having consented to the entry of this Final Judgment 
without trial or adjudication of any issue of fact or law; and 
without this Final Judgment constituting any evidence or admission 
by any party with respect to any issue of fact or law;
    And Whereas, Defendants have agreed to be bound by the 
provisions of this Final Judgment pending its approval by the Court;
    And Whereas, the Plaintiffs intend Defendants to be required to 
preserve competition for solid waste disposal by honoring certain 
contracts, as amended, and by giving to a competitor an option to 
purchase real property capable of being used as a municipal solid 
waste transfer station to preserve competition in solid waste 
disposal in Dade and Broward Counties, Florida, now and in the 
future, and, by permitting a competitor to preserve its ability to 
compete for and to have access to capacity for sufficient volumes of 
municipal solid waste to remain a viable solid waste disposal 
competitor while its seeks another transfer station site;
    And Whereas, Defendants have represented that the contract 
changes and the option agreement to purchase real estate described 
below can and will be made and honored and that Defendants will 
later raise no claims of hardship or difficulty as grounds for 
asking the Court to modify any of the provisions contained below.
    Now, therefore, before any testimony is taken, and without trail 
or adjudication of any issue of fact or law, and upon consent of the 
parties, it is hereby
    Ordered, Adjudged and Decreed as follows:

I. Jurisdiction

    This Court has jurisdiction of the subject matter of this action 
and over each of the parties hereto. The Complaint states a claim upon 
which relief may be granted against Defendants under Section 7 of the 
Clayton Act, as amended, 15 U.S.C. 18.

II. Definitions

    As used in this Final Judgment:
    (A) ``Broward'' means Broward County, Florida.
    (B) ``Chambers'' means Chamber Waste Systems of Florida, Inc., a 
subsidiary of USA Waste Services, Inc. Chambers is a corporation 
organized and existing under the laws of the State of Florida with 
its principle offices in Okeechobee, Florida.
    (C) ``Dade'' means Dade County, Florida.
    (D) ``Defendants'' means Reuter and WMF, as hereinafter defined.
    (E) ``Reuter'' means defendant Reuter Recycling of Florida, 
Inc., Reuter is a corporation organized and existing under the laws 
of the State of Florida with its principal offices in Pembroke 
Pines, Florida.
    (F) ``Solid waste disposal service'' means the final disposal of 
municipal solid waste, generally in a landfill or incineration 
facility.
    (G) ``Transfer Station Agreement'' means the agreement between 
Reuter and Chambers dated as of July 14, 1993 pursuant to which 
Reuter, among other things, accepts for transfer certain solid waste 
material delivered by Chambers or Chambers' subcontractors. A copy 
of the Transfer Station Agreement is attached as Exhibit A.
    (H) ``Amendment to Transfer Station Agreement'' means the 
Agreement between Reuter and Chambers dated October 20, 1995 
modifying the Transfer Station Agreement. A copy of the Amendment to 
Transfer Station Agreement is attached as Exhibit B.
    (I) ``Option Agreement'' means the Agreement between Reuter and 
Chambers dated October 20, 1995. A copy of the Option Agreement is 
attached as Exhibit C.
    (J) ``WMF'' means defendant Waste Management Inc. of Florida, a 
subsidiary of Waste Management, Inc. WMF is a corporation organized 
and existing under the laws of the State of Florida with its 
principal offices in Pompano Beach, Florida.
    (K) ``Acquisition'' means the acquisition of the majority of the 
outstanding stock of Reuter by WMF.
    (L) ``Reuter Transfer Station'' means the facility owned by 
Reuter and located at 2079 Pembroke Road, Pembroke Pines, FL which 
currently, among other things, accepts for transfer certain solid 
waste material delivered by Chambers or Chambers' subcontractors and 
also accepts waste from the cities of Pompano Beach, Pembroke Pines, 
Dania, and Hallandale, FL.

III. Applicability

    This Final Judgment applies to Defendants and to their officers, 
directors, managers, agents, employees, successors, assigns, 
affiliates, parents and subsidiaries, and to all other persons in 
active concert or participation with any of them who shall have 
received actual notice of this Final Judgment by personal service or 
otherwise. Nothing contained in this Final Judgment is or has been 
created for the benefit of any third party, and nothing herein shall 
be

[[Page 51138]]

construed to provide any rights to any third party.

IV. Entry Into and Compliance With Agreements

    On or before the date the Acquisition is consummated, Reuter 
shall enter into the Amendment to Transfer Station Agreement and the 
Option Agreement. Defendants shall be bound by the terms of the 
Transfer Station Agreement, as modified by the Amendment to Transfer 
Station Agreement, and the Option Agreement. Defendants shall not 
convey to any person other than Chambers, the property subject to 
the Option Agreement, prior to the later of July 14, 1998 or any 
extension of that Option Agreement, except as provided in the Option 
Agreement. Defendants shall not exercise their right to replace 
Chambers as the Facility operator under Paragraph 3f of the 
Amendment to Transfer Station Agreement without the prior approval 
of the United States, in consultation with Florida.

V. Termination of the Agreements

    In the event Chambers has secured the right to use and is using 
another transfer station capable of serving Broward or Dade Counties 
prior to July 14, 1998, Defendants may notify Plaintiffs of that 
fact and Defendants may request in writing that they be relieved of 
the obligation to extend the term of the Transfer Station Agreement 
as set forth in Paragraph 2 of the Amendment to Transfer Station 
Agreement, and of the obligation to convey property under the Option 
Agreement. The United States may grant one or both of Defendants; 
requests if it determines, in its sole discretion after consultation 
with Florida, that Chambers can effectively compete in the relevant 
markets without access to the Reuter Transfer Station or without 
access to the property subject to the Option Agreement.

VI. Interim Preservation of Viable Competition

    (A) Defendants shall not enter into any contract or contracts, 
with any firm listed on Exhibit D, having a term in excess of one 
(1) hear, or having multiple consecutive one (1) year terms, for the 
disposal of solid waste, where any such waste would be transported 
through the Reuter Transfer Station for disposal elsewhere, Exhibit 
D is a list of the customers of Chambers for whom Chambers uses the 
Reuter Transfer Station to enable it to dispose of solid waste as of 
the date this Final Judgment is filed (``Chambers Customers'').
    (B) Defendants' obligations under Paragraph VI.A. shall 
terminate upon the United States providing Defendants with written 
notice, following application by Defendants, that the United States, 
in its sole discretion after consultation with Florida, has 
determined that Chambers can compete effectively in the relevant 
market if Defendants are permitted to contract with Chambers' 
Customers as proscribed in Paragraph VI.A. In any event, Paragraph 
VI.A. shall terminate on the date the Transfer Station Agreement, as 
amended by the Amendment to the Transfer Station Agreement, 
terminates.
    (C) Nothing herein shall preclude Defendants from contracting 
with any of the Chambers' Customers for a period of one (1) year or 
less; or, for a period in excess of one (1) year where that 
customer's solid waste is not transported by Defendants, directly or 
indirectly, through the Reuter Transfer Station.

VII. Defendants' Obligations of Noninterference and Assistance

    In the event that Chambers seeks to permit a new transfer 
station or seeks access to a new or existing transfer station other 
than the Reuter Transfer Station, Defendants shall take no action to 
protest, lobby against, object to, or otherwise impede, directly or 
indirectly, any attempts by Chambers to lease, purchase, site, 
obtain appropriate zoning for, obtain permits and any and all other 
governmental approvals for a solid waste transfer station capable of 
serving Broward or Dade, nor shall Defendants provide financing or 
other assistance to any person who does so. Furthermore, from the 
effective date of the Option Agreement through the termination date 
of that Agreement, including any extensions thereof, Defendants will 
cooperate with Chambers' efforts to obtain any necessary government 
approvals on the property subject to the Option Agreement.
    Notwithstanding the provisions of this Final Judgment, 
Defendants may bid on and enter into contracts with municipal or 
governmental entities for the provision or use of transfer station 
facilities in Dade and Broward.

VIII. Acquisition of the Option Property

    If the option the purchase under the Option Agreement is 
exercised, Defendants shall not, without prior written consent of 
the United States, after consultation with Florida, re-acquire any 
of the property conveyed pursuant to the Option Agreement.

IX. Reporting and Plaintiffs' Access

    (A) To determine or secure compliance with this Final Judgment, 
duly authorized representatives of the Plaintiffs shall, upon 
written request of the Assistant Attorney General in charge of the 
Antitrust Division or the Florida Attorney General or his duly 
authorized representative, respectively, on reasonable notice given 
to Defendants at their principal offices, subject to any lawful 
privilege, be permitted:
    (1) Access during normal office hours to inspect and copy all 
books, ledgers, accounts, correspondence, memoranda and other 
documents and records in the possession, custody, or control of 
Defendants, which may have counsel present, relating to any matters 
contained in this Final Judgment.
    (2) Subject to the reasonable convenience of Defendants and 
without restraint or interference from them, to interview officers, 
employees, or agents of Defendants, who may have counsel present, 
regarding any matters contained in this Final Judgment.
    (B) Upon written request of the Assistant Attorney General in 
charge of the Antitrust Division or the Florida Attorney General or 
his duly authorized representative, on reasonable notice given to 
Defendants at their principal officers, subject to any lawful 
privilege, Defendants shall submit such written reports, under oath 
if requested, with respect to any matters contained in this Final 
Judgment.
    (C) No information or documents obtained by the means provided 
by this Section shall be divulged by the Plaintiffs to any person 
other than a duly authorized representative of the Executive Branch 
of the United States government or of the State of Florida, except 
in the course of legal proceedings to which the United States is a 
party, or for the purpose of securing compliance with this Final 
Judgment, or as otherwise required by law.
    (D) If at the time information or documents are furnished by 
Defendants to Plaintiffs, Defendants represent and identify in 
writing the material in any such information or document to which a 
claim of protection may be asserted under Rule 26(c)(7) of the 
Federal Rules of Civil Procedure, and Defendants mark each pertinent 
page of such material ``Subject to claim of protection under Rules 
26(c)(7) of the Federal Rules of Civil Procedure,'' then ten days 
notice shall be given by Plaintiffs to Defendants prior to divulging 
such material in any legal proceeding (other than a grand jury 
proceeding) to which Defendants are not party.

X. Further Elements of Judgment

    (A) This Final Judgment shall expire on the tenth anniversary of 
the date of its entry.
    (B) jurisdiction is retained by this Court over this action and 
the parties thereto for the purpose of enabling any of the parties 
thereto to apply for the purpose of enabling any of the parties 
thereto to apply to this Court at any time for further order and 
directions as may be necessary or appropriate to carry out or 
construe this Final Judgment, to modify or terminate any of its 
provisions, to enforce compliance, and to punish violations of its 
provisions.

XI. Public Interest

    Entry of this Final Judgment is in the public interest.
    Plaintiff's motion (unopposed) for entry of Judgment as granted.

    Entered: January 22, 1996

    Court approval subject to procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16.
Royce C. Lamberth,
United States District Judge.

Exhibit B--Service Agreement, Northeast Maryland Waste Disposal 
Authority and Garnet of Maryland, Inc.

Service Agreement by and Between Northeast Maryland Waste Disposal 
Authority and Garnet of Maryland, Inc. To Provide Solid Waste 
Acceptance, Processing, Transportation and Disposal Services for Anne 
Arundel and Howard Counties, Maryland

    Dated as of August 8, 1996.

Table of Contents

Recitals
Article I--Definitions and Rules of Interpretation

[[Page 51139]]

    Section 1.1  Definitions
    Section 1.2  Rules of Interpretation
Article II--Obligations Relating To Acceptance of Waste; Operating 
Procedures; Performance of Authority's Obligations
    Section 2.1  Acceptance, Processing, Transportation and Disposal 
of Acceptable Waste
    Section 2.2  Refusal of Deliveries
    Section 2.3  Receiving Hours and Waiting Time
    Section 2.4  Scales and Weighing Records
    Section 2.5  Hazardous Waste
    Section 2.6  Manner of Deliveries; Vehicle Size; Rule & 
Regulations
    Section 2.7  Contract for Project Management; Performance 
Security
    Section 2.8  Repairs and Maintenance
    Section 2.9  Authority and County Access
    Section 2.10  Clean-Up and Disposal
    Section 2.11  Regulatory Requirements
Article III--Service Fee; Damages; Payments
    Section 3.1  Service Fee, Damages, Payments
    Section 3.2  Monthly Payments
    Section 3.3  Late Payment
    Section 3.4  Disputes as to Service Fee or Other Charges
    Section 3.5  Books and Records, Audit and Reports
    Section 3.6  Accounting
Article IV--Processing Capacity Reductions and Uncontrollable 
Circumstances
    Section 4.1  Effect of Uncontrollable Circumstances
    Section 4.2  Changes Necessitated by Uncontrollable 
Circumstances
Article V--Insurance and Indemnification
    Section 5.1  Types of Insurance for the Company
    Section 5.2  Delivery of Evidence of Insurance; Certain Required 
Provisions
    Section 5.3  Indemnification
Article VI--Default and Termination
    Section 6.1  Remedies for Default
    Section 6.2  Events of Default by the Company
    Section 6.3  Events of Default by the Authority
    Section 6.4  Termination on Default
    Section 6.5  Termination for Certain Uncontrollable 
Circumstances
    Section 6.6  Termination for Convenience
    Section 6.7  Default Termination Damages Payable to the 
Authority
    Section 6.8  Survival of Certain Rights and Obligations
Article VII--Term; Renewal
    Section 7.1  Term
    Section 7.2  Renewal
Article VII--Representations and Warranties
    Section 8.1  Representations and Warranties of the Authority
    Section 8.2  Representations and Warranties of the Company
Article IX--Miscellaneous
    Section 9.1  Authority Representative, County Representative and 
Company Representative
    Section 9.2  Assignment
    Section 9.3  Notices
    Section 9.4  Entire and Complete Agreement
    Section 9.5  Binding Effect
    Section 9.6  Further Assurances and Amendments
    Section 9.7  Governing Law
    Section 9.8  Counterparts
    Section 9.9  Amendment or Waiver
    Section 9.10  Relationship of the Parties
    Section 9.11  Confidential Information
    Section 9.12  Severability
    Section 9.13  Damages
    Section 9.14  Effect of Authority and County Approvals
    Section 9.15  Dispute Resolution
    Section 9.16  Limitation of Liability and Defenses
    Section 9.17  Counties as Third Party Beneficiaries
    Section 9.18  Nondiscrimination
    Section 9.19  Minority Business Enterprise Requirements
    Section 9.20  Public Ethics
    Section 9.21  Impossibility of Performance
Schedules
    Schedule 1  Description of the Service
    Schedule 2  Definitions
    Schedule 3  Service Fees
    Schedule 4  Reporting Requirements
    Exhibit A to Schedule 4:
    Monthly Performance Report Forms
    Schedule 5  Form of Performance Bonds
    Performance Bond
    Schedule 6  Required Insurance
    Schedule 7  Minority Business Participation Policy
    Schedule 8  Guaranty
    Schedule 9  Termination Procedures and Costs

    This Service Agreement is made as of August 8, 1996 between the 
Northeast Maryland Waste Disposal Authority (``Authority'') and 
Garnet of Maryland (``Company'').

Recitals

    A. The Authority is an instrumentality of the State of Maryland 
created to assist with the preservation, improvement and management 
of the quality of air, land and water resources and to promote the 
health and welfare of the citizens of the State by providing 
dependable, effective and efficient disposal of solid Wastes, 
including the recovery of usable resources from such Waste. Howard 
County and Anne Arundel County, Maryland (collectively, 
``Counties'') have requested that the Authority provide for the 
Acceptance, Processing, Transfer and Disposal of certain amounts of 
non-recycled solid waste (the ``Services'') collected by, or on 
behalf of, the Counties.
    B. The Authority and the Counties will enter into a Waste 
Disposal Agreement under which the Authority will be obligated to 
provide these Services.
    The Authority intends to fulfill its obligations to the Counties 
to provide the Services by entering into and managing this 
Agreement.
    C. The Authority, in cooperation with the Counties, has selected 
the Company through a competitive process. The Company has 
demonstrated that it is qualified to accept process, transport and 
dispose of solid Waste.
    D. The Company shall provide the Acceptance Facility, Disposal 
Facility and other Facilities so as to receive and process all of 
the solid Waste delivered to the Company by the Counties or the 
Designated Haulers.
    E. The Counties will be third party beneficiaries of the 
Company's obligations under this Agreement.
    Now, therefore, in consideration of the mutual promises and 
covenants of each to the other contained herein and other good and 
valuable consideration, receipt of which is hereby acknowledged, the 
parties of this Service Agreement agree as follows:

Article I--Definitions and Rules of Interpretation

Section 1.1  Definitions

    Capitalized terms used in this Agreement have the meanings set 
forth in Schedule 2.

Section 1.2  Rules of Interpretation

    For all purposes of this Agreement, except as otherwise 
expressly provided or unless the context otherwise requires:
    (a) All reference in this instrument to designated ``Articles,'' 
Sections'' and other subdivisions are to the designated Articles, 
Sections and other subdivisions of this instrument as originally 
executed.
    (b) The terms defined in this Article have the meanings assigned 
to them in this Article and include the plural as well as the 
singular.
    (c) Words,of the masculine gender shall be deemed and construed 
to include correlative words of the femine and neuter genders.
    (d) The table of contents and the headings or captions used in 
this Agreement are for convenience of reference only and do not 
define, limit or describe any of the provisions hereof or the scope 
or intent hereof.
    (e) References to agreements or contracts include all 
amendments, modifications and supplements thereto.

Article II--Obligations Relating to Acceptance of Waste; Operating 
Procedures; Performance of Authority's Obligations

Section 2.1  Acceptance, Processing, Transportation and Disposal of 
Waste

    (a) The Company has sole responsibility for the provision and 
operation of all facilities, personnel, vehicles and sites necessary 
to provide the Service as described in Schedule 1. The Company shall 
communicate on a routine basis to ensure the day-to-day coordination 
of activities between the Company, the Counties and the Authority. 
Upon request of the Authority Representative or any of the County 
Representatives, the Company shall meet with the Authority and/or 
one or both of the Counties.
    Beginning on the Commencement Date and continuing throughout the 
term of this Agreement the Company shall accept, process, transfer 
and dispose in accordance with this Agreement and Applicable Law all 
Acceptable Waste delivered by or on behalf of the Counties.
    (b) Acceptable Waste will be delivered in vehicles owned or 
operated by employees of or under contract to, the Counties or a 
Designated Hauler. The Counties or a Designated Hauler may deliver 
Acceptable Waste in any form they deem appropriate. The Authority 
shall provide the Company with the following information about each 
vehicle delivering Acceptable Waste to the Company for its credit; 
hauler name and address, make, body type; tag or permit

[[Page 51140]]

number of each vehicle used; area of collection; and whether the 
vehicle is owned by the Counties or by a Designated Hauler.
    (c) The Authority understands that the Company may accept Waste 
from other customers at the Facilities, but it may not accept Waste 
from other customers during the interim period at Anne Arundel 
County's Millersville Landfill.

Section 2.2  Refusal of Deliveries

(a) Extent of Refusal Rights

    The Company may reject deliveries of Acceptable Waste delivered 
at hours established under Section 2.3. Acceptable Waste rejected by 
the Company for any reason other than as permitted pursuant to this 
Section 2.2 (a) or (b) or any other provision of this Agreement 
constitute Wrongfully Diverted Acceptable Waste. The amount of 
Wrongfully Diverted Acceptable Waste is used to calculate Alternate 
Disposal Damages under Section 3.2.
    The parties agree that Company shall be the only party entitled 
to establish the classification of Waste delivered to a Facility, 
subject to the Authority's ability to object to such classification 
as set forth in Section 3.4.

(b) Inspection of Delivered Waste

    The Company shall develop and maintain any and all reasonable 
appropriate screening programs at the Acceptable Facility. Any such 
screening programs shall include any reasonable programs and 
practices required by the Counties or the Authority. The Counties 
and the Authority shall cooperate with the Company with regard to 
the screening programs. Neither the inclusion of programs or 
practices in the Waste screening programs by the Authority or the 
Counties nor the review or comment by the Authority or the Counties 
upon any Company proposal with regard to the Waste screening 
programs relieves the Company of any of its obligations hereunder or 
imposes any liability upon the Authority or the Counties.
    The Company may inspect the contents of all vehicles delivering 
Waste under this Agreement to the Acceptance Facility. The Counties 
will monitor their own collection operations to reduce the 
collection of Unacceptable Waste. The Company will institute 
appropriate procedures, including inspection procedures, to ensure 
that Unacceptable Waste is separated at the Acceptance Facility. The 
Company will give immediate notice to the Counties of deliveries of 
Unacceptable Waste to the Company, followed by prompt written notice 
indicating the time, the source of delivery and identity of the 
hauling firm and driver. The intent of this requirement is to ensure 
safe handling by the Company of the Waste received in compliance 
with Applicable Law. The Company shall handle and dispose of 
Unacceptable Waste that is received at the Acceptance Facility.
    The cost for disposal of Unacceptable Waste shall be paid to the 
Company as specified in this Service Agreement.
    The Company shall be entitled to the Unacceptable Waste Disposal 
Cost described in Section 3.2 for any amounts of Unacceptable Waste 
it removes from the Acceptance Facility.

Section 2.3  Receiving Hours and Waiting Time

    (a) The Company shall accept the delivery of Acceptable Waste 
during the hours of 7:00 a.m. to 5:00 p.m., Monday through Saturday 
and until 7:00 p.m. on the first regular collection day following a 
Holiday. Acceptable Waste will not be delivered by the Counties on 
the following holidays. The Authority shall designate the dates on 
which holidays are to be observed.

New Year's Day
Memorial Day
Independence Day
Labor Day
Thanksgiving Day
Christmas Day

    (b) The Company shall accept Acceptable Waste at hours other 
than the Receiving Hours, to the extent permitted by Applicable Law, 
upon reasonable prior notice of such delivery. The Out of Hours 
Delivery Charge for Company operations outside of Receiving Hours, 
pursuant to this Section 2.3(b), may be charged for each ton of 
Waste delivered before 7:00 a.m. and after 5:00 p.m. except that the 
Out-of-Hours Delivery Charge shall not be charged for Waste 
delivered between the hours of 5:00 p.m. and 7:00 p.m. on the first 
regular collection day following a holiday. The amount shall be 3% 
above the per ton bid price. The Out of Hours Delivery Charge shall 
not apply for any hours the Acceptance Facility is open to receive 
Waste from sources other than the Authority.
    (c) The Company shall take all steps necessary to ensure that 
the time period between delivery vehicle arrival at and departure 
from the Acceptance Facility does not exceed 30 minutes for 
Acceptable Waste delivered by the Counties, Designated Haulers, or 
the Authority.

Section 2.4  Scales and Weighing Records

    The Company shall operate and maintain the road vehicle scales 
at the Acceptance Facility which shall provide for automatic 
weighing and recording of all Wastes received and removed. The 
Company shall weigh all vehicles delivering Acceptable Waste to the 
Project. The scales shall incorporate a computer interface system 
and use software acceptable to the Authority. The weight record 
shall contain gross weight, tare weight, date, time of arrival, time 
of departure, description of Waste in the vehicle, vehicle 
identification (truck or permit number) and identification of origin 
of Waste in the vehicle.
    The Authority may require each vehicle operator delivering Waste 
to present to the scale operator a card, permit, identification or 
license. The Company or the Authority may require from time to time 
the revalidation of the tare weight of any vehicle or the reweighing 
of unloaded vehicles.
    If the permanent vehicle scales at the Acceptance Facility are 
not working properly or are being tested, the Company shall use 
portable scales at the Acceptance Facility. If portable scales or 
other alternate weighing facilities and equipment meeting the 
requirements of Applicable Law are not available, a ``scale outage'' 
will occur, and the Company shall estimate the quantity of 
Acceptable Waste delivered on the basis of truck volumes and 
historical information about the Authority, the Counties, the 
Company and the Designated Haulers. These estimates shall take the 
place of actual weighing records during the scale outage. In order 
to participate in the estimating of quantities of Acceptance Waste 
during a scale outage, the Authority and/or County may have an 
employee or agent present in the scale house when each vehicle 
arrives.
    The Company, at its expense, shall obtain approval of, inspect 
and test the vehicle scales as required by Applicable Law but no 
less frequently than once per year. At the written request of the 
Authority, the Company in the presence of the Authority 
Representative, shall make additional tests of all vehicle scales. 
The cost of these additional tests shall be borne by the Authority 
if the scales meet the accuracy requirements of Applicable Law.
    If any test shows that a scale registers farther above or below 
the correct reading than permitted by Applicable Law, the charges 
and calculations based on scale readings made within thirty (30) 
days preceding the test shall be corrected by the percentage of 
inaccuracy found. If a test of the scales has been performed during 
the preceding thirty (30) days, only the readings and related 
charges and calculations made after that test shall be corrected on 
the basis of the subsequent test.
    The Company shall maintain daily records of the total tonnage of 
Waste delivered to the Acceptance Facility, the tonnage of Waste 
accepted by the Company and the tonnages of Unacceptable Waste. The 
Company shall submit monthly reports, as specified in schedule 4 in 
a form approved by the Authority. The Company shall cooperate with 
the Authority and the Counties to provide this information 
electronically or on disk. The Company shall furnish the Authority a 
compilation of such information for each month, within ten days 
after the end of the month. The Company shall keep copies of all 
weight tickets for at least three years which shall be available for 
inspection by the Authority and the Counties upon request.
    The Company shall pay all costs for accepting, transporting, 
processing and final disposal of Acceptable Waste.

Section 2.5  Hazardous Waste

    (a) The Company shall develop a plan for the identification, 
handling and disposal of Hazardous Waste discovered at the 
Acceptance Facility (the ``Hazardous Waste Plan''). The Company 
shall segregate and isolate all Hazardous Waste discovered at the 
Acceptance Facility in accordance with this Agreement, the Hazardous 
Waste Plan, Applicable Law and any procedures required by the 
Authority in connection with the segregation and isolation of 
Hazardous Waste (collectively, the ``Hazardous Waste Protocol''). 
The Company shall maintain any screening programs reasonably 
necessary or otherwise reasonably required by the Authority that, 
under Applicable Law, segregate Hazardous Waste delivered to the 
Acceptance Facility.
    (b) So long as the Company (i) acts in accordance with the 
Hazardous Waste

[[Page 51141]]

Protocol and Applicable Law and (ii) enforces its and the 
Authority's right to payments from third parties or under applicable 
insurance policies due to the discovery of Hazardous Waste, then the 
cost of segregation isolation and disposal of the Hazardous Waste 
shall be reimbursed if the Hazardous Waste was delivered in a 
vehicle owned, operated or contracted by one of the Counties, the 
Authority, or a Designated Hauler, provided that such vehicle is 
correctly identified by the Company as the particular vehicle which 
delivered such Hazardous Waste.
    (c) If Hazardous Waste is delivered to the Acceptance Facility, 
and the source of such Hazardous Waste or hauler delivering 
Hazardous Waste cannot be determined by the Parties, the Company 
shall separately contain, set aside, segregate, isolate and manage 
the Hazardous Waste as required by law and by the Hazardous Waste 
Protocol, and the Authority and the Counties shall be notified 
immediately of its location, general character and amount. The 
Company shall remove, or cause to be removed, such Hazardous Waste 
from the Acceptance Facility and shall transport and dispose of, or 
shall cause such Hazardous Waste to be transported and disposed, in 
accordance with State and Federal law. The Company shall, at no 
expense to the Counties or the Authority, bear all of the costs of 
transportation and disposal of Hazardous Waste which is delivered to 
the Acceptance Facility because the Company has failed to follow or 
enforce any provision of the Hazardous Waste Protocol. The foregoing 
shall not be considered to be a waiver of any claim Company may have 
against any other third party, including a Designated Hauler. 
Company may make any such claim directly against the party involved, 
and to the extent necessary by law in order for such claim to 
proceed, the Authority and the Counties assign to Company their 
respective rights to make such a claim.
    (d) Hazardous Waste delivered by a vehicle owned, operated, or 
contracted by one of the Counties, the Authority, or a Designated 
Hauler which is segregated for disposal as Hazardous Waste shall 
only be disposed of at a Disposal Facility approved by the 
Authority.

Section 2.6  Manner of Deliveries; Vehicle Size; Rules and Regulations

    The Authority shall comply with the reasonable rules and 
regulations for the delivery of Acceptable Waste to the Acceptance 
Facility that are provided by the Company and agreed to by the 
Authority and Counties, which include regulations regarding 
vehicular movement on the Acceptance Facility Site and screening to 
segregate Unacceptable Waste. No rules or regulations are effective 
against the Authority, the Counties, or Designated Haulers unless 
approved by the Authority Representative and the County 
Representatives, which approval shall not be unreasonably withheld.

Section 2.7  Contract for Project Management; Performance Security

    (a) The parties acknowledge that the dependable operation and 
maintenance of the Acceptance Facility, the Disposal Facility and 
other Facilities providing the Service is in the interests of the 
parties to this Agreement. The Company shall not enter into or 
maintain any contract or subcontract with any person other than an 
Affiliate of the Company for any substantial portion of the 
operation, management or control of a Facility or the performance of 
any of the Company's obligations under this Agreement without the 
prior written consent of the Authority.
    (b) No contract or subcontract between the Company and any other 
person will affect the Company's obligation under this Agreement.
    (c) Prior to the Commencement Date the Company shall provide 
evidence of a Performance Bond, standby Letter of Credit or 
Corporate Guarantee from a surety or insurance company acceptance to 
the Authority, covering the performance obligations of the Company 
under Article II of this Agreement. The Performance Bond, Letter of 
Credit or corporate guarantee shall be in an amount equal to one 
year of estimated Service Fee payments to the Company, as defined in 
Section 3.1 of this Agreement, and name, among others, the Authority 
as beneficiary. The Performance Bond or LOC shall be in the form set 
forth in Schedule 5. The Company shall provide the Performance 
Bonds, Letter of Credit, or corporate guarantee until release by the 
Authority. The Authority shall release the Performance Bond, Letter 
of Credit or corporate guarantee upon termination of this Agreement 
as long as the Company is not in default and the Performance Bond, 
Letter of Credit, or corporate guarantee is not being drawn upon by 
the Authority.

Section 2.8  Repairs and Maintenance

    The Company, at its own expense, shall maintain the Facilities 
in good condition at all times, and make all repairs and 
replacements required for the Company to perform its obligations 
under this Agreement. The Company shall maintain the safety of the 
Facilities at a level consistent with Applicable Law and standard 
facility practices.

Section 2.9  Authority and County Access

    The Authority, the Counties and their respective agents, 
licensees and invitees may visit or inspect the Facilities at any 
reasonable time during the term of this Agreement. The Authority 
Representative or its designees, or the County Representatives or 
their respective designees may inspect the Facilities at any time 
from time to time without notice. The Authority, the Counties and 
their respective agents, licensees and invitees shall conduct visits 
to the Facilities in a manner that does not cause unreasonable 
interference with the Company's operations. To the extent practical, 
the Authority and the Counties shall provide the names of all 
invitees to the Company in advance. The Company may require any 
Person on a Facility site to comply with its reasonable rules and 
regulations and to sign a statement agreeing (i) to assume the risk 
of the visit but not the risk of injury due to the intentional or 
negligent acts or omissions of the Company or any of its 
subcontractors, agents or employees and (ii) not to disclose or use 
any Confidential Information of the Company other than for the 
purpose for which it was furnished or, in the case of Authority or 
County employees and agents, except in accordance with Section 9.11.

Section 2.10  Clean-Up and Disposal

    The Company shall keep the Facilities free from accumulation of 
Wastes or rubbish (except in appropriate locations) caused by 
operations at the Facilities and shall maintain and operate the 
Facilities so as to prevent the Sites from becoming unsightly or a 
nuisance under Applicable Law.

Section 2.11  Regulatory Requirements

    The Company shall perform its obligations under this Agreement 
and operate the Facilities in accordance with all requirements of 
Applicable Law, regulations, and permits. The Company shall obtain 
and maintain, or cause to be obtained and maintained, all permits 
and licenses required by Applicable Law to perform its obligations 
hereunder, provided that the Company will not breach its obligations 
under this Section if (i) the Company is contesting the Applicable 
Law in good faith by appropriate proceedings conducted with due 
diligence and the Applicable Law allows continue operation of the 
Facilities pending resolution of the contest or (ii) the Company is 
diligently seeking to comply with such Applicable Law or to obtain 
or maintain any such permit or license and Applicable Law allows 
continued operation of the Facilities.

Article III--Service Fee: Damages; Payments

Section 3.1  Service Fee, Damages, Payments

    (a) From and after the Commencement Date, the Company may charge 
and collect from the Authority a fixed Service Fee as shown in 
Schedule 3 for each ton of Acceptable Waste accepted by the Company 
from the Counties, or Designated Haulers for disposal hereunder.
    (b) the Authority shall pay to the Company certain other charges 
as detailed in Section 3.2. The Authority may retain or set-off from 
any amounts due the Company, Acceptance Facility Delay Damages, 
Alternate Disposal Damages, Alternate Procurement Damages and 
Delivery Delay Damages.
    (c) The Service Fee and Out of Hours Delivery Charge shall not 
be adjusted by any inflation factor.

Section 3.2  Monthly Payments

    (a) The Company shall provide the Authority and the Counties 
with a statement or invoice for all amounts payable hereunder by the 
twenty-fifth (25th) day of the calendar month immediately succeeding 
the calendar month for which such amounts are payable. Amounts 
invoiced are due thirty (30) days after receipt of the invoice by 
the Authority and the Counties. Each invoice shall set forth amount 
of the Service Fee and other charges payable to the Company for the 
applicable period, together with supporting documentation including 
scale records, sufficient to allow the recipient of the invoice to 
verify the Company's calculations of the Service Fee and other 
charges for such

[[Page 51142]]

period. The supporting documentation shall be adequate to allow the 
Authority to determine the portion of the amount payable by each of 
the Counties. The amounts payable monthly in accordance with Section 
3.2 are calculated as follows:
    (i) The amount due for Service Fee payments shall be the product 
of the Service Fee multiplied by the aggregate number of tons of 
Acceptable Waste delivered by a County, a Designated Hauler, or the 
Authority during the month; plus
    (ii) Any Out-of-Hours delivery charges; plus
    (iii) The Company's direct out of pocket costs for Unacceptable 
Waste that is delivered to the Acceptance Facility by a County, a 
Designated Hauler, or the Authority and disposed of by the Company; 
less
    (iv) The amount of Acceptance Facility Delay Damages, Alternate 
Disposal Damages, Alternate Procurement Damages and Delivery Delay 
Damages, if any.
    All Company invoices and statements shall be delivered by hand 
or mailed first class, postage prepaid, to: Northeast Maryland Waste 
Disposal Authority, 25 S. Charles Street, Suite 2105, Baltimore, 
Maryland 21201-3330, Attention: Executive Director.
    The Authority shall have no obligation to make payment for any 
amount of Acceptable Waste delivered to the Acceptance Facility by 
any Person other than a County, a Designated Hauler, or the 
Authority.

Section 3.3  Late Payment

    Any amounts payable under this Agreement by the Authority or the 
Company that are not paid when due in accordance with this Agreement 
shall, unless otherwise specifically provided, bear interest, to the 
extent permitted by Applicable Law, at the Late Payment Rate.

Section 3.4  Disputes as to Service Fee or Other Charges

    If the Company or the Authority disputes any amount owed as the 
Service Fee, Out-of-Hours Delivery Charge pursuant to Section 9.15, 
the classification of Waste made by the Company, or the amount of 
Damages claimed by the Authority under Section 3.2(iv) or elsewhere 
herein, the disputed portion of such adjustment is not effective 
until resolution of a dispute. Immediately after the resolution of a 
disagreement about a Service Fee or Out-of-Hours Delivery Charge, 
classification of Waste or amount of Damages, the party whose 
position does not prevail shall reimburse the other party for the 
aggregate amount of any underpayment or overpayment, plus interest 
at the Late Payment Rate.

Section 3.5  Books and Records, Audit and Reports

    (a) The Company shall maintain all books, records and accounts 
necessary to record all matters affecting the Service Fee, Out-of-
Hours Delivery Charge, applicable damages or other amounts payable 
by or to the Authority or the Company under this Agreement or other 
agreements, including, but not limited to, policies for Required 
Insurance, policy amendments and all other related insurance 
documents. The Company shall maintain all such books, records and 
accounts in accordance with GAAP. The Company's books, records and 
accounts shall accurately, fairly and in reasonable detail reflect 
all the Company's dealings and transactions under this Agreement and 
other agreements and shall contain sufficient data to enable those 
dealings and transactions to be audited in accordance with generally 
accepted auditing standards. The Company shall make all such books, 
records and accounts available for inspection and photocopying by 
the Authority or the Counties within 5 business days of a written 
request by the Authority or a County.
    (b) The Company shall provide the Authority and the Counties 
with the reports and information set forth in Schedule 4 at the 
times required by Schedule 4. The report format can be modified with 
approval of the Authority to reflect the facilities used by the 
Company to provide the Service.
    (c) The Company certifies that all information the Company has 
provided, or will provide to the Authority or the Counties, is true 
and correct and can be relied upon by the Authority and the Counties 
in awarding, modifying, making payments, or taking any other action 
with respect to this Agreement. Any material false or misleading 
information is a ground for the Authority to terminate this 
Agreement for cause, without opportunity to cure, and to pursue any 
other appropriate remedy.

Section 3.6  Accounting

    Beginning July 1, 1997, within sixty (60) days following the end 
of each Fiscal Year, the Company shall provide an accounting to the 
Authority and the Counties of all payments made by the Authority for 
the Fiscal Year and all amounts payable by the Authority for such 
Fiscal Year.

Article IV--Processing Capacity Reductions and Uncontrollable 
Circumstances

Section 4.1  Effect of Uncontrollable Circumstances

    A party to this Agreement shall not be in default under this 
Agreement or liable to the other party for its failure to perform 
obligations under this Agreement, if such failure results from an 
Uncontrollable Circumstance. The Company shall diligently overcome 
or remove such Uncontrollable Circumstance as soon as possible. The 
Company shall give prompt notice of such claim to the Authority and 
to the County Representatives with reasonably requested information 
concerning the nature of such claim and the efforts to overcome or 
remove the Uncontrollable Circumstance.

Section 4.2  Changes Necessitated by Uncontrollable Circumstances

    (a) As soon as possible after an Uncontrollable Circumstance 
occurring on or after the Commencement Date, the Company shall give 
the Authority Representative and the County Representatives a 
statement describing the Uncontrollable Circumstance and its cause 
(to the extent known to the Company), and a description of the 
conditions preventing the performance of the Company's obligations
    (b) If a Facility is unavailable due to an Uncontrollable 
Circumstance, the Company must diligently pursue finding an 
alternate facility. Any alternate acceptance facility must be within 
the same geographic boundaries as shown in the RFB. Alternate 
disposal facilities must be approved by the Authority. The Company 
may seek pre-approval of an alternate disposal facility.
    In no case will the Service Fee increase due to an 
Uncontrollable Circumstance.
    (c) The Company shall answer any inquiries of the Authority 
Representative or the County Representatives regarding the 
conditions caused by the Uncontrollable Circumstance and shall 
provide them with such information as they reasonably request. Upon 
the request of the Authority Representative or the County 
Representative, a consulting engineer, at the Authority's expense, 
may review the Company's estimate of the time schedule for repairing 
a Facility or the alleged causes of the Uncontrollable Circumstance.

Article V--Insurance and Indemnification

Section 5.1  Types of Insurance for the Company

    The Company shall obtain and maintain, or cause to be obtained 
and maintained, the Required Insurance in the forms approved by the 
Authority. The deductible limits contained in Schedule 6 shall not 
be increased. The Company shall procure and maintain any additional 
insurance coverage requested by the Authority that is available on 
commercially reasonable terms and such other insurance required by 
Applicable Law if the Authority agrees that the cost of the 
additional insurance may be added to the Service Fee. Insurance 
required to be obtained by the Company pursuant to this Section 5.1 
is ``Required Insurance'' for all purposes of this Agreement.

Section 5.2  Delivery of Evidence of Insurance: Certain Required 
Provisions

    (a) Within ten (10) business days of execution of this Agreement 
by the Authority, and at any time thereafter, the Company shall 
deliver to the Authority copies of all certificates of insurance for 
Required Insurance and any policy amendments and policy renewals 
upon ten (10) business days after receipt by the Company. Except for 
Worker's Compensation Insurance, each policy shall name the 
Authority and the Counties as co-insured and required the insurer to 
provide the Authority and the Counties sixty (60) days' prior 
written notice of termination or cancellation or of any change in 
coverage or deductibles under such Policy.
    (b) The Company shall use only responsible insurance companies 
of recognized standing which are authorized to do business in 
Maryland as providers of all Required Insurance. The Company shall 
carry all Required Insurance with insurance companies rated at least 
``A-'' or its equivalent by Best's Key Rating or another national 
rating organization. The Company may effect Required Insurance by 
endorsement of blanket insurance policies.
    (c) The Company shall not take out separate insurance concurrent 
in form or contribution in the event of loss with Required Insurance 
if the existence of such

[[Page 51143]]

insurance reduces amounts payable under Required Insurance if the 
existence of such insurance reduces amounts payable under Required 
Insurance. The Company shall immediately notify the Authority 
whenever it applies for any separate insurance and shall promptly 
deliver the policy or policies evidencing the separate insurance to 
the Authority.
    (d) The Company shall submit to the appropriate insurer timely 
notices and claims of all losses insured under any Required 
Insurance policy, pursue such claims diligently and comply with all 
terms and conditions of Required Insurance policies. The Company 
shall promptly give the Authority and the Counties copies of all 
notices and claims of loss and any documentation or correspondence 
related to such losses. The Company shall make all policies for 
Required Insurance, policy amendments and other related insurance 
documents available for inspection and photocopying by the Authority 
or the Counties on reasonable notice.

Section 5.3  Indemnification

    Company agrees to indemnify, save harmless and defend the 
Authority, the Counties and their respective officers, employees and 
agents, from and against any and all liabilities, claims, penalties, 
forfeitures, suits and the costs and expenses incident thereof 
(including costs of defense, settlement and reasonable attorneys' 
fees), which they, individually or collectively, may incur, become 
responsible for or pay out as a result of death or bodily injury to 
any person, destruction or damage to any property, contamination of 
or adverse effects on the environment, or any violation of 
governmental laws, regulations or orders, to the extent caused, in 
whole or in part, by a breach of any term, provision, representation 
or warranty of this Agreement or any negligent act or omission or 
willful misconduct of the Company, or its officers, employees or 
agents. This indemnification is not to be deemed as a waiver of any 
immunity which may exist in any action against the Authority or the 
Counties.
    The Company shall also indemnify, defend, hold harmless and 
hereby waives any claim for contribution against the Authority, the 
State of Maryland, the Counties, or their respective officers, 
agents and employees, for any Environmental Claim arising in whole 
or in part from the performance of the Company or its officers, 
employees, agents or subcontractors, under this Agreement, 
irrespective of whether such performance is negligent or willful or 
breaches any term or provision of this Agreement. For purposes of 
this section of the Agreement, the following definitions apply:
    ``Environmental Claim'' means any investigation, notice, 
violation, demand, allegation, action, suit, injunction, judgment, 
order, consent decree, penalty, fine, lien, proceeding or claim 
arising (a) pursuant to, or in connection with, an actual or alleged 
violation of, any Environmental Law, (b) in connection with any 
Hazardous Waste or actual or alleged Hazardous Waste Activity, (c) 
from any abatement, removal, remedial, corrective, or other response 
action in connection with a Hazardous Waste, Environmental Law or 
other order of a Governmental Authority or (d) from any actual or 
alleged damage, injury, threat, or harm to health, safety, natural 
resources, or the environment.
    ``Environmental Law'' shall mean any current or future Legal 
Requirement pertaining to (a) the protection of health, safety and 
the indoor or outdoor environment, (b) the conservation, management, 
or use of natural resources and wildlife, (c) the protection or use 
of surface water or groundwater, (d) the management, manufacture, 
possession, presence, use, generation, transportation, treatment, 
storage, disposal, Release, threatened Release, abatement, removal, 
remediation or handling of, or exposure to, any Hazardous Waste or 
(e) pollution (including any release to air, land, surface water and 
groundwater), and includes, without limitation, the Comprehensive 
Environmental Response, Compensation and Liability Act of 1980, as 
amended, 42 U.S.C. Secs. 9601 et seq.,, Solid Waste Disposal Act, as 
amended, 42 U.S.C. Secs. 6901 et seq. Federal Water Pollution 
Control Act, as amended, 33 U.S.C. Secs.  1251, et seq., Clean Air 
Act, as amended, 42 U.S.C. 7401 et seq., Toxic Substances Control 
Act of 1976, 15 U.S.C. Secs. 2601 et seq., Hazardous Wastes 
Transportation Act, 49 U.S.C. App. Secs. 1801 et seq., Occupational 
Safety and Health Act of 1970, as amended, 29 U.S.C. Secs. 651 et 
seq., Oil Pollution Act of 1990, 33 U.S.C. Secs. 2701 et seq., 
Emergency Planning and Community Right-to-Know Act of 1986, 42 
U.S.C. Secs. 1101 et seq., National Environmental Policy Act of 
1969, 42 U.S.C. Secs. 4421 et seq., Safe Drinking Water Act of 1974, 
as amended, 42 U.S.C. Secs. 300(f) et seq., any similar, 
implementing or successor law, including, without limitation, laws 
enacted by the State of Maryland or any other State, and any 
amendment, rule, regulation, order, or directive issued thereunder.
    ``Governmental Approval'' means any permit, license, variance, 
certificate, consent, letter, clearance, closure, exemption, 
decision or action or approval of a ``Governmental Authority.''
    ``Governmental Authority'' means any international, foreign, 
federal, state, regional, county, or local person or body having 
governmental or quasi-governmental authority or subdivision thereof.
    ``Hazardous Waste'' has the meaning given in Schedule 2 to this 
Agreement.
    ``Hazardous Waste Activity'' shall mean any activity, event, or 
occurrence involving a Hazardous Waste, including without 
limitation, the manufacture, possession, presence, use, generation, 
transportation, treatment, storage, disposal, Release, threatened 
Release, abatement, removal, remediation, handling of or corrective 
or response action to any Hazardous Waste.
    ``Legal Requirement'' means any treaty, convention, statute, 
law, regulation, ordinance, Governmental Approval, injunction, 
judgment, order, consent decree, or other requirement of any 
Governmental Authority.
    ``Release'' means any spilling, leaking, pumping, pouring, 
emitting, emptying, discharging, injecting, escaping, leaching, 
dumping, or disposing into the indoor or outdoor environment, 
including, without limitation, the abandonment or discarding of 
barrels, drums, containers, tanks or other receptacles containing or 
previously containing any Hazardous Waste.

Article VI--Default and Termination

Section 6.1  Remedies for Default

    (a) If the Authority breaches any of its obligations under this 
Agreement, the right of the Company to recover damages or to be 
reimbursed ordinarily constitutes an adequate remedy. Therefore, the 
Company may not terminate its obligations under this Agreement for 
cause or any breach unless an Event of Default (as defined in 
Section 6.3) on the part of the Authority has occurred and is 
continuing.
    (b) The Company acknowledges that a breach of this Agreement or 
an Event of Default by the Company entitles the Authority to 
recover, to the extent proven, all of its damages, as set forth in 
this Agreement, caused by such default or Event of Default. 
Nevertheless, any persistent failure by the Company to provide 
Service hereunder entitles the Authority to terminate this 
Agreement.

Section 6.2  Events of Default by the Company

    Each of the following constitute an Event of Default on the part 
of the Company.
    (a) The failure or refusal by the Company to fulfill any of its 
material obligations to the Authority in accordance with this 
Agreement, the RFB and the bid submittal unless such failure or 
refusal is excused or justified pursuant to this Agreement, or the 
failure or refusal by the Guarantor to fulfill any of its 
obligations in accordance with the Guaranty Agreement. Regardless of 
whether there exists an event of Default, if the Company fails or 
refuses to perform any of its obligations, the Company shall be 
liable to the Authority for the full amount of the Authority's 
Alternate Disposal Damages. No such failure or refusal on the part 
of the Company or Guarantor shall constitute an Event of Default 
unless and until:
    (i) The Authority has given written notice to the Company 
stating that in its opinion a particular default or defaults 
(described in reasonable detail in such notice) exist that shall, 
unless corrected, constitute a material breach of this Agreement on 
the part of the Company and that give the Authority a right to 
terminate its obligations to the Company under this agreement for 
cause under this Section unless such default is corrected within a 
reasonable period of time; and
    (ii) The Company or the Guarantor, as the case may be, have 
neither corrected such default nor initiated reasonable steps to 
correct it within a reasonable period of time (a reasonable period 
of time, for purposes of this paragraph, shall in any event be not 
less than 30 business days from the date of the notice given 
pursuant to clause (i) of this Section for any obligation other than 
one related to a failure by the Company to accept Waste pursuant to 
the terms of this Agreement, for which obligation a reasonable 
period of time shall in any event be not less than five (5) business 
days from the date of

[[Page 51144]]

the notice given pursuant to clause (i) of this Section 6.2(a)), 
provided that if the Company or the Guarantor has commenced to take 
reasonable steps to correct such default within such reasonable 
period of time, the default shall not constitute an Event of Default 
for as long the Company or the Guarantor, as the case may be, is 
continuing to take reasonable steps to correct it; or
    (b) If, by the order of a court of competent jurisdiction, a 
receiver, liquidator, custodian or trustee of either the Company or 
the Guarantor or of a major part of either of their property is 
appointed and is not discharged within sixty (60) days, or if, by 
decree of such a court, the Company or the Guarantor is adjudicated 
insolvent or a major part of either of their property is sequestered 
and such decree has continued undischarged and unstayed for sixty 
(60) days after the entry of such decree, or if a petition to 
reorganize the Company or the Guarantor pursuant to the Federal 
Bankruptcy Code or any other similar statute applicable to the 
Company or the Guarantor, as now or hereinafter in effect, is filed 
against the Company or the Guarantor and is not dismissed within 
sixty (60) days after such filing; or
    (c) If either the Company or the Guarantor is adjudicated 
bankrupt or files a petition in voluntary bankruptcy under any 
provision of any bankruptcy law or consents to the filing of any 
bankruptcy or reorganization petition against either the Company or 
the Guarantor under any such law, or (without limitation of the 
generality of the foregoing) files a petition to reorganize the 
Company or the Guarantor pursuant to the Federal Bankruptcy Code or 
any other similar statute applicable to the Company or the 
Guarantor, as now or hereafter in effect; or
    (d) If either the Company or the Guarantor makes an assignment 
for the benefit or creditors, or admits, in writing, an inability to 
pay debts generally as they become due, or consents to the 
appointment of a receiver or liquidator or trustee or assignee in 
bankruptcy or insolvency of the either the Company or the Guarantor 
or a major part of either or their property; or
    (e) If the Company provides or has provided materially false or 
misleading information to the Authority or the Counties; or
    (f) The failure of the Company or other Facility operators to 
comply with Applicable Law in any material fashion; or
    (g) The failure of the Company to provide a fully operational 
Service by the Commencement Date, including the Acceptable Facility 
by January 1, 1997, or failure to provide evidence upon request of 
Authority that the Acceptable Facility will be available by January 
1, 1997.

Section 6.3  Events of Default by the Authority

    Each of the following constitutes an Event of Default on the 
part of the Authority:
    (a) The failure by the Authority to pay any amount in excess of 
$550,000, that the Authority is required to pay to the Company under 
this Agreement within sixty (60) days after receipt by the Authority 
of written demand from the Company accompanied by notice stating 
that unless such amount is paid within sixty (60) days after such 
demand the failure shall constitute an Event of Default; or
    (b) The failure or refusal by the Authority substantially to 
fulfill any of its material obligations to the Company in accordance 
with this Agreement, other than as provided in subparagraph (a) 
above, unless such failure or refusal is excused or justified 
pursuant to the provisions of this Agreement, provided that no such 
failure or refusal constitutes an Event of Default unless and until:
    (i) The Company has given prior written notice to the Authority 
and the County Representatives stating that in its opinion a 
particular default or defaults (described in reasonable detail in 
such notice) exists and unless corrected, constitute a material 
breach of this Agreement on the part of the Authority and gives the 
Company a right to terminate this Agreement for cause under this 
Section 6.3(b) unless such default is corrected within a reasonable 
period of time; and
    (ii) Neither the Authority nor the Counties have corrected such 
default nor initiated steps to correct it within a reasonable period 
of time (a reasonable period of time for purposes of this paragraph 
shall in any event not be less than thirty (30) Business Days from 
the date of the notice given pursuant to clause (i) of this Section 
6.3(b)), provided that if the Authority or the Counties have 
commenced to take reasonable steps to correct such default within 
such reasonable period of time, it shall not constitute an Event of 
Default for as long as the Authority or the Counties are continuing 
to take reasonable steps to correct it; and
    (iii) There exists no reasonable expectation that the Company 
can obtain relief other than by termination of this Agreement for 
such default sufficient to compensate it for any loss incurred as a 
result of such Authority default.
    (c) The failure of the Company to comply with the Project's MBE 
requirements as found in the Minority Business Enterprise Terms and 
Conditions.
    Notwithstanding the foregoing provisions, in no event shall the 
Authority's or Counties' failure to deliver Acceptable Waste 
constitute an Event of Default under this Agreement as neither the 
Authority nor the Counties guarantee delivery of any minimum 
quantity of Acceptable Waste.

Section 6.4  Termination on Default

    The right of termination for cause may be exercised only by a 
notice of Termination (the ``Notice of Termination'') given to the 
party in default. Subject to Section 9.13(b), the proper exercise of 
the right of termination is in addition to and not in substitution 
for, such other remedies, whether damages or otherwise, of the party 
exercising the right of termination. When one party terminates its 
obligations to the other party in accordance with this Agreement, 
all of their rights, remedies, powers and privileges under this 
Agreement are terminated, except as provided in Sections 6.7 and 
6.8.

Section 6.5  Termination for Certain Uncontrollable Circumstances

    If, as a result of the occurrence of one or more Uncontrollable 
Circumstances, the Acceptance Facility is closed for 10 (ten) or 
more consecutive days, then the Authority may terminate this 
Agreement upon notice to the Company. If this Agreement is so 
terminated, then neither party shall owe or be liable to the other 
party for any amounts otherwise due hereunder, except for (i) 
Service Fee amounts due for Waste actually delivered prior to the 
effective date of the termination and (ii) amounts due in accordance 
with Section 5.3 ``Indemnification.''

Section 6.6  Termination for Convenience

    Notwithstanding, any other provision of this Agreement to the 
contrary and subject to State law, the Authority may terminate this 
Agreement and its obligations to the Company under this Agreement at 
any time by (i) giving the Company thirty (30) days' notice of such 
termination, (ii) paying the Termination Settlement Amount and (iii) 
providing the releases in accordance with Schedule 9.

Section 6.7  Default Termination Damages Payable to the Authority

    If this Agreement is terminated by the Authority for cause as a 
result of an Event of Default by the Company, the Company shall 
immediately pay, without duplication, to the Authority (i) all 
amounts necessary to provide for the excess costs to the Authority 
of substitute performance by another firm, during the Service 
Agreement's term, not including renewal terms, had the Agreement not 
been terminated for default, (ii) an amount equal to Alternate 
Disposal Damages during the then remaining term of this Agreement, 
and (iii) Alternate Procurement Damages.
    With the prior express written consent of the Authority and the 
County, such consent not to be unreasonably withheld, the Company 
may mitigate its Default Termination Damages payable under this 
Section 6.7 by providing the Service using alternative facilities 
which (i) are in compliance with Applicable Law and, (ii) the 
Authority has agreed and meets all of the minimum technical 
requirements in the RFB.

Section 6.8  Survival of Certain Rights and Obligations

    The rights and obligations of the parties under Section 5.3 and 
Articles I and VIII shall survive any termination of this Agreement. 
No termination of this Agreement limits or otherwise affects the 
rights and obligations of any party that have accrued before the 
date of such termination.

Article VII--Term; Renewal

Section 7.1  Term

    This Agreement is in effect from its date and, unless sooner 
terminated, shall continue in effect until December 31, 1999.

Section 7.2  Renewal

    This Agreement may be extended at the Authority's option at one 
year intervals up to an additional three years.

[[Page 51145]]

    The Authority shall give the Company thirty (30) days notice of 
its intent to renew the Service Agreement for each additional year.

Article VIII--Representations and Warranties

Section 8.1  Representations and Warranties of the Authority

    The Authority hereby makes the following respective 
representations and warranties, as of the date of execution and 
delivery of this Agreement, to and for the benefit of the Company:
    (a) The Authority is a body politic and corporate validly 
existing under the Constitution and laws of Maryland, with full 
legal right, power and authority to enter into and perform its 
obligations under this Agreement.
    (b) The Authority has duly authorized the execution and delivery 
of this Agreement and this Agreement has been duly executed and 
delivered by the Authority and constitutes a legal, valid and 
binding obligation of the Authority, enforceable against the 
Authority in accordance with its terms.
    (c) Neither the execution or delivery by the Authority of this 
Agreement, nor the performance of the Authority's obligations in 
connection with the transactions contemplated hereby nor the 
Authority's fulfillment of the terms or conditions of this Agreement 
(i) conflicts with, violates or results in a breach of any 
Applicable Law, or (ii) conflicts with, violates or results in a 
breach of any term or condition of any judgment or decree, or any 
agreement or instrument, to which the Authority is a party or by 
which the Authority or any of its properties or assets are bound, or 
constitutes a default thereunder.
    (d) No approval, authorization, order or consent of, or 
declaration, registration or filing with, any governmental authority 
is required for the valid execution and delivery by the Authority of 
this Agreement except those that have been duly obtained or made.

Section 8.2  Representations and Warranties of the Company

    The Company hereby makes the following representations and 
warranties to and for the benefit of the Authority and the Counties:
    (a) The Company is duly organized and validly existing as a 
Corporation under the laws of the State of Maryland with full legal 
right, power and authority to enter into and perform its obligations 
under this Agreement, and is duly qualified to do business and is in 
good standing in each jurisdiction in which the character of the 
properties owned by it therein or in which the transaction of its 
business makes such qualification necessary, including, but not 
limited to, the State of Maryland.
    (b) The Company has duly authorized the execution and delivery 
of this Agreement and this Agreement has been duly executed and 
delivered by the Company and constitutes a legal, valid and binding 
obligation of the Company, enforceable against the Company in 
accordance with its terms.
    (c) Neither the execution or delivery by the Company of this 
Agreement, nor the performance by the Company of its obligations in 
connection with the transactions contemplated hereby or the 
fulfillment by the Company of the terms or conditions of this 
Agreement (i) conflicts with, violates or results in a breach of any 
Applicable Law, or (ii) conflicts with, violates or results in a 
breach of any term or condition of any judgment or decree, or any 
agreement or instrument, to which the Company is a party or by which 
the Company or any of its properties or assets are bound, or 
constitutes a default thereunder or (iii) will result in the 
creation or imposition of any lien, charge or encumbrance of any 
nature whatsoever upon any of the properties or assets of the 
Company.
    (d) No approval, authorization, order or consent of, or 
declaration, registration or filing with, any governmental authority 
is required for the valid execution and delivery of this Agreement 
by the Company, except such as have been duly obtained or made.
    (e) Except as disclosed to the Authority, in writing, there is 
no action, suit or proceeding, at law or in equity, before or by any 
court or governmental authority, pending or, to the best of the 
Company's knowledge, threatened, against the Company, wherein an 
unfavorable decision, ruling or finding would materially adversely 
affect the performance by the Company of its obligations hereunder 
or in connection with the transactions contemplated hereby, or 
which, in any way, would adversely affect the validity or 
enforceability of this Agreement, or any other agreement or 
instrument entered into by the Authority in connection with the 
transactions contemplated hereby.

Article IX--Miscellaneous

Section 9.1  Authority Representative, County Representatives and 
Company Representative

    (a) The Authority Representative is the Executive Director of 
the Authority.
    (b) The Company Representative is the President of the Company 
or any vice president of the Company who the Company designates as 
the Company Representative and who is authorized to contractually 
bind the Company.
    (c) The County Representatives are the Directors of Public Works 
for each County.
    (d) Any party may change its authorized representative upon five 
(5) Business Days' written notice to the other parties. Only the 
Authority Representative or the Company Representative may make the 
approvals, requests and notices by a party to the other party under 
this Agreement.

Section 9.2  Assignment

    Neither the Authority nor the Company may assign this Agreement 
without the prior written consent of the other party except that the 
Authority may assign its rights, remedies, powers and privileges 
under this Agreement to any of the Counties without the consent of 
the Company.

Section 9.3  Notices

    All notices, designators, consents, approvals, and other 
communications required, permitted or otherwise delivered under this 
Agreement shall be in writing and may be telexed, cabled, sent by 
facsimile or delivered by hand or mailed by first call registered or 
certified mail, return receipt requested, postage prepaid, and in 
any case shall be addressed as follows:
    If to the Authority: Executive Director, Northeast Maryland 
Waste Disposal Authority, 25 S. Charles Street, Suite 2105, 
Baltimore, Maryland 21201-3330, Fax: (410) 333-3721.
    With a copy to the County Representatives:

Director, Howard County Department of Public Works, 3430 Courthouse 
Drive, Ellicott City, Maryland 21043, Fax: (410) 313-3408
Director, Anne Arundel County Department of Public Works, 2662 Riva 
Road, Annapolis, Maryland 21401, Fax: (410) 222-7329

    If to the Company: Earl Mikolitch, President, Atlantic Region, 
Sanifill, Inc., 6525 The Corners Parkway, Suite 540, Norcross, GA 
30092.
    With a copy to: H. Steven Walton, General Counsel, Sanifill, 
Inc., 2777 Allen Parkway, Suite 700, Houston, TX 77019-2155.
    Any party entitled to receive communications under this 
agreement may change the address to which its communications are 
delivered by notice to the other parties. Any communications given 
by mail in accordance with this Section 9.3 shall be deemed to have 
been given five (5) business Days after the date of mailing; 
communications given by any means shall be deemed to have been given 
when delivered.

Section 9.4  Entire and Complete Agreement

    This Agreement (including Schedules 1 through 9 to this 
Agreement) constitutes the entire and complete agreement of the 
parties with respect to its subject matter and supersedes all prior 
or contemporaneous understandings, arrangements, commitments and 
representation, all of which, whether oral or written, are merged 
into this Agreement. The Schedules to this Agreement are an integral 
part of this Agreement and shall be afforded full force and effect 
as tough incorporated in their entirety in the Articles of this 
Agreement.

Section 9.5  Binding Effect

    This Agreement binds and inures to the benefit of the parties to 
this Agreement and any successor or assignee acquiring an interest 
hereunder permitted by Section 9.2.

Section 9.6  Further Assurances and Amendments

    Each party shall execute and deliver any instruments and perform 
any acts necessary and reasonably requested by the other party in 
order to give full effect to this Agreement.

Section 9.7  Governing Law

    The laws of the State of Maryland govern the validity, 
interpretation, construction and performance of this Agreement.

Section 9.8  Counterparts

    The Authority and the Company may execute this Agreement in 
counterparts, each of which is deemed an original, and all of which, 
when executed and delivered, together constitute one and the same 
instrument.

[[Page 51146]]

Section 9.9  Amendment or Waiver

    Neither the Authority nor the Company may change, modify, amend 
or waive this Agreement or any provision of this Agreement except by 
a written instrument signed by the party against whom enforcement of 
such change, modification, amendment or waiver is ought.

Section 9.10  Relationship of the Parties

    No party to this Agreement has any responsibility whatsoever 
with respect to services provided or contractual obligations assumed 
by any other party and nothing in this Agreement is deemed to 
constitute one party a partner, agent or legal representative of any 
of the other parties or to create any fiduciary relationship between 
the parties.

Section 9.11  Confidential Information

    The rights and obligations of the parties set forth herein with 
respect to Confidential Information are subject to Applicable Law, 
including Title 10, Subtitle 6 of the State Government Article of 
the Annotated Code of Maryland, as amended.
    To the extent permitted by Applicable Law, the Authority shall 
hold Confidential Information in strict confidence and take all 
reasonable precautions to prevent disclosure to third parties. The 
Authority shall promptly notify the Company of the identity of any 
Person who requests a disclosure of Confidential Information. The 
Authority in its sole discretion shall determine the response to any 
request for disclosure of Confidential Information and is not 
required to withhold disclosure of Confidential Information upon a 
lawful request for information. The Authority shall consider any 
information or legal arguments presented by the Company before the 
disclosure of the requested information.

Section 9.12  Severability

    If a court of competent jurisdiction determines any provision of 
this Agreement is, for any reason, invalid, illegal or unenforceable 
in any respect, the parties hereto shall negotiate in good faith and 
make such amendments, modifications or supplements of or to this 
Agreement, that to the maximum extent practicable in light of such 
determination, implement and give effect to the intentions of the 
parties as reflected herein, and the other provisions of this 
Agreement shall, as so amended, modified or supplemented, or 
otherwise affected by such action, remain in full force and effect.

Section 9.13  Damages

    (a) The Alternate Disposal Damages and Alternate Disposal 
Procurement Damages specified in this Agreement constitute the 
parties' sole and exclusive remedy for the acts, errors or omissions 
for which ``Damages'' those Damages are imposed. The parties may 
recover additional amounts for damages caused by other acts, errors 
or omissions.
    (b) Notwithstanding the foregoing, in no event, whether based 
upon contract, tort or otherwise, arising out of the performance or 
nonperformance by the Authority of any obligation under this 
Agreement, is the Authority liable or obligated in any manner to pay 
special, consequential or indirect damages, or any other amount 
except as specifically provided in this Agreement.

Section 9.14  Effect of Authority and County Approvals

    (a) No review, comment or approval by the Authority or the 
Counties under this Agreement affects the rights, remedies, powers 
or privileges of the Authority or the Counties in connection with 
(i) licenses, permits, reviews or approvals pursuant to Applicable 
Law, (ii) the enactment, interpretation or enforcement of any 
Applicable Law, (iii) any of its other governmental functions, or 
(iv) matters not related to this Agreement.
    (b) Now review, comment or approval, nor any failure to review, 
comment or give approval, by the Authority or the Counties under 
this Agreement relieves the Company of any of its obligations under 
this Agreement or imposes any liability upon the Authority or the 
Counties.

Section 9.15  Dispute Resolution

    The Authority and the Company shall in good faith attempt to 
resolve any dispute or matter in controversy under this Agreement. 
All disputes under this Contract, if not resolved by the parties, 
shall be resolved by courts of competent jurisdiction in the State 
of Maryland and in accordance with the laws of the State of 
Maryland.

Section 9.16  Limitation of Liability and Defenses

    (a) Notwithstanding any other provision of this Agreement to the 
contrary, the obligations of the Authority to the Company under this 
Agreement are limited to the obligations of the Authority under the 
Waste Disposal Agreements (the ``WDA'') to the extent such 
obligations are satisfied. Neither the Authority nor the Counties 
will be liable to the Company for consequential damages of any type. 
The Authority represents that payments to be received from the 
Counties under the Waste Disposal Agreement are or will be 
sufficient to make monetary payments to the Company.
    (b) Notwithstanding any other provision of this Agreement to the 
contrary, the liability and obligations of the Authority for all 
monetary payments with respect to this Agreement are limited 
obligations payable solely from WDA Revenues as and to the extent 
such WDA Revenues are received and available to pay such amounts 
under Applicable Law. The Authority represents that Revenues to be 
received from the Counties are or will be sufficient to make 
monetary payments to the Company. The liability of the Authority for 
any such monetary payments with respect to this Agreement are not 
payable from the general funds of the Authority and the incurrence 
or nonperformance of such obligations or payments shall not 
constitute or create a legal or equitable pledge of, or lien or 
encumbrance upon, or claim against, any of the assets or property of 
the Authority or of its income, receipts or revenues. 
Notwithstanding any provision of this Agreement to the contrary, the 
Company may bring legal action against the Authority if WDA Revenues 
received from the Counties are not sufficient to make monetary 
payments to the Company.
    (c) No recourse for the payment of any amounts due by the 
Authority under this Agreement or upon any representation, warranty, 
covenant, agreement or obligation contained in this Agreement or in 
any document, certificate or instrument that this Agreement requires 
to be executed and delivered by the Authority or from any claim 
herein or therein shall be had by the Company, except from WDA 
Revenues.
    (d) The execution and delivery of this Agreement by the 
Authority shall not impose any personal liability on the members, 
officers, directors, employees or agents of the Authority. No 
recourse shall be had by the Company for any claims based on this 
Agreement against any member, officer, employee or other agent of 
the Authority in his or her individual capacity, all such liability, 
if any, being expressly waived by the Company by the execution of 
this Agreement.
    (e) Unless specifically excused by this Agreement, the Company 
shall not assert impossibility or impracticability of performance, 
the existence, nonexistence, occurrence or nonoccurrence of a 
foreseen or unforeseen fact, event or contingency that may be a 
basic assumption of the Company, or commercial frustration of 
purpose as a defense against any claim by the Authority or the 
Counties against the Company.

Section 9.17  Counties as Third Party Beneficiaries

    The Counties are singly and jointly third-party beneficiaries of 
all of the obligations of the Company under this Agreement. The 
Counties have the right, but not the obligation, to enforce rights, 
remedies, powers and privileges of the Authority under this 
Agreement if any of the Counties provides ten (10) days' prior 
written notice to the Authority and the Company. Unless such prior 
notice is given by the Counties, it is understood by all parties 
that the Authority Representative shall have the authority to direct 
the Company with respect to the Authority's and Counties' rights 
herein and the Company shall have the right to rely on such 
direction.

Section 9.18  Nondiscrimination

    The Company shall not discriminate or permit discrimination 
against a Person because of race, color, religion, national origin 
or sex. This provision prohibiting discrimination is a material term 
of this Agreement.

Section 9.19  Minority Business Participation Requirements

    The Company shall structure its procedures for the performance 
of the services required by this contract to achieve the Authority's 
minority business participation goals. Such performance by minority 
business enterprise shall be in accordance with this Section and 
Schedule 7. The Company agrees to use its best efforts to carry out 
the requirements of this Section consistent with efficient 
performance of the Project.

[[Page 51147]]

Section 9.20  Public Ethics

    (a) The Authority may terminate the right of the Company to 
proceed under this Agreement if it is found by the Authority that 
gratuities (in the form of entertainment, gifts, or otherwise) were 
offered or given by the Company, or any agent or representative of 
the Company, to any officer or employee of the Authority or a County 
with a view toward securing this Agreement or securing favorable 
treatment with respect to the awarding or amending, or the making of 
any determinations with respect to the performing of this Agreement; 
the facts upon which the Authority makes such findings may be 
reviewed in any competent court.
    (b) In the event this Agreement is terminated as provided in 
paragraph (a), above, the Authority shall be entitled (i) to pursue 
the same remedies against the Company as it could pursue in the 
event of a breach of the Agreement by the Company, and (ii) in 
addition to any other damages to which it may be entitled by law, to 
exemplary damages in an amount (as determined by the Authority) 
which shall be not less than three nor more than ten times the costs 
incurred by the Company in providing any such gratuities to any such 
officer or employee.
    (e) The rights and remedies of the Authority provided in this 
clause shall not be exclusive and are in addition to any other 
rights and remedies provided by law or under this Agreement.
    (d) No employee of the State of Maryland, the Authority, or any 
department, commission, agency or branch thereof, whose duties as 
such employee include matters relating to or affecting the subject 
matter of this Agreement, shall, while such employee, become or be 
an employee of the party or parties hereby contracting with the 
State, the Authority, or any department, commission, agency or 
branch thereof.

Section 9.21  Impossibility of Performance

    if, during the Term of this Agreement, an event occurs that 
causes either party's performance under this Agreement to be 
impossible, then each party hereto agrees to negotiate in good faith 
for a modification to this Agreement that is mutually agreeable to 
each party. The Company and the Authority acknowledge that no change 
in Applicable Law that imposes or increases any cost, tax, fee, 
assessment or charge shall be considered to render the affected 
party's performance impossible for purposes of this Section.
    In witness whereof, the Authority and the Company have executed 
and sealed this Agreement as of the date first written above.
    Witness: [Signature Illegible]

    Witness: [Signature Illegible]

    Northeast Maryland Waste Disposal Authority [Signature 
Illegible]

    Garnet of Maryland, Inc.

By:--------------------------------------------------------------------
Earl Mikolitch,
President.

Schedule 1 to Service Agreement

Description of the Service

    The Company shall perform the Services described in this 
Agreement and in the following documents:
    1. The Request for Bids issued on April 16, 1996.
    2. The Bid Submittal dated May 13, 1996.
    3. Addenda were issued as follows:

--Addendum No. 1 issued on April 17, 1996
--Addendum No. 2 issued on April 26, 1996
--Addendum No. 3 issued on May 6, 1996

    In the event of a conflict among these documents, the Service 
Agreement shall supersede all prior or contemporaneous agreements, 
representations and understandings. The RFB shall likewise supersede 
the Bid Submittal.
    Incorporated by reference from the bid submittal of Garnet of 
Maryland, Inc. is the following:
    1. A description of the bidder's system.
    2. Interim Period Service description.
    3. Evidence of Acceptance Facility availability on or before 
January 1, 1997, if applicable.

Schedule 2 to Service Agreement

Definitions

    ``Acceptance Facility'' means the Facility located at Annapolis 
Junction Transfer Station, 8077 Brock Bridge Road.
    ``Acceptance Facility Delay Damages'' means an amount equal to 
twenty-five percent (25%) of the applicable Service Fee during the 
period beginning on January 1, 1997 in which the Acceptance Facility 
is not available and the Company is using a County landfill for the 
Acceptance, Processing and Transfer of Acceptable Waste.
    ``Acceptable Waste'' means all Waste which is not Unacceptable 
Waste and typically includes:
    A. Household garbage, trash, rubbish and refuse of the kinds 
normally generated by residential housing units and commercial 
establishments located in the Counties, including, without 
limitation:
    1. Large household items such as beds, mattresses, sofas, 
bicycles, baby carriages, automobile parts and roofing Wastes of the 
types that are generally collected by the Counties and private 
haulers from residential housing units located in the Counties, or 
which are delivered to drop-off locations operated by the Counties; 
and
    2. Brush, branches, leaves, twigs, grass and plant cuttings.
    B. Commercial and light industrial Waste normally generated by 
governmental, commercial and light industrial and manufacturing 
establishments located in the Counties.
    C. Construction and demolition debris.
    D. Residue from a Materials Resource Recovery Facility, or 
Composting Facility.
    E. Acceptable Waste previously deposited in the existing 
Counties' landfills.
    ``Affiliate'' means any other Person who controls, is controlled 
by, or is under common control with the Company.
    ``Agreement'' means this Service Agreement between the Authority 
and the Company (including Schedules 1 through 10 to this 
Agreement).
    ``Agreement Date'' means August 8, 1996.
    ``Alternate Disposal Damages'' means an amount equal to all 
reasonable expenses incurred by the Authority and the Counties as a 
result of the failure of the Company to fulfill its obligations 
under this Agreement for the cost of acceptance, transfer and 
disposal of Waste, the cost of statutory or regulatory penalties, 
counsel fees and reasonable expenses incurred by the Counties or the 
Authority and which are not foreseeable by the Parties at this time.
    ``Alternate Procurement Damages'' means an amount equal to the 
reasonable and direct costs estimated to be incurred by the 
Authority and the Counties to procure another company to provide the 
Service. In no event must Alternate Procurement Damages exceed 
actual costs incurred by the Counties and Authority in procuring 
another Company for this Agreement.
    ``Applicable Law'' means any law, regulation, requirement or 
order of any Federal, State or local agency, court or other 
governmental body (including, without limitation, the Anne Arundel 
County and Howard County Comprehensive Solid Waste Management Plans 
and all permits, licenses and governmental approvals required as of 
the date of this Agreement), applicable to: 1) the acquisition, 
design, construction, equipping, testing, financing, ownership, 
possession or operation of the Acceptance Facility and the Disposal 
Facility or any other Facility used to provide the Service 2) the 
Agreement; or 3) the performance of any obligations under the 
Agreement or any other agreement entered into in connection with the 
Agreement.
    ``Business Day'' means any day other than Saturday, Sunday or a 
day on which either state or national banks in Maryland are not open 
for normal banking business.
    ``Company'' means Garnet of Maryland, Inc., and its permitted 
successors and assigns.
    ``Commencement Date'' means the first day on which Acceptable 
Waste is delivered to the Company under this contract, which date is 
expected to be July 1, 1996.
    ``Company Representative'' means the authorized representative 
of the Company designed in accordance with Section 9.1.
    ``Confidential information'' means proprietary information of 
the Company related to solid Waste disposal given to the Authority 
or the Countries by the Company in connection with this Agreement 
that (1) the Counties or the Authority (as the case may be) is not 
required to disclose under Applicable Law, (2) is not in the public 
domain, (3) is in tangible form, (4) is identified as confidential 
by the word ``confidential'' conspicuously marked on the upper right 
hand corner of each page thereof, and (5) is annotated to reference 
the provisions of Applicable law that authorize non disclosure of 
such material and information to the public.
    ``County'' or ``Counties'' means, respectively, Howard County, 
Maryland, and Anne Arundel County, Maryland, and their respective 
successors and permitted assigns.

[[Page 51148]]

    ``County Representative'' means the Person designated by each 
County in accordance with Section 9.1.
    ``Delivery Delay Damages'' means an amount equal to fifty 
percent (50%) of the applicable Service Fee or Out of Hours Delivery 
Charge for every ton of Waste delivered by the Authority, County or 
a Designated Hauler for which the delivery vehicle had to wait in 
excess of 30 (thirty) minutes after arrival at the Acceptance 
Facility property boundary in order to deposit the Waste.
    ``Designated Hauler'' means any Person who is designated by the 
Authority, or a County to deliver Waste to the Acceptance Facility, 
on behalf of the Authority or a County.
    ``Disposal Facility'' means the solid waste disposal facility 
identified by the Company as the facility for final disposal of 
Acceptable Waste delivered by the Authority under the Agreement. If 
the Acceptable Waste is delivered to a waste-to-energy facility, 
composting facility, or other processing facility the Company must 
provide a disposal facility for all residue, non-processible and 
bypass waste.
    ``Event of Default'' means an Event of Default as defined in 
Article VI.
    ``Facility or Facilities'' means any component of the Company's 
system which receives, processes, transports and/or disposes of 
Waste and any residue or byproduct of processing Waste.
    ``Fiscal Year'' means the year commencing on July 1 of any 
calendar year and ending on June 30 of the succeeding calendar year.
    ``GAAP'' means those principles of accounting set forth in 
pronouncements to the Financial Accounting Standards Board, the 
American Institute of Certified Public Accountants, or which have 
other substantial and nationally recognized authoritative support 
and are applicable in the circumstances as of the date of a report, 
as such principles are from time to time supplemented and amended.
  ``Guarantor'' means.-------------------------------------------------
    ``Hazardous Waste'' means:
    A. Any Waste or substance, the treatment, storage or disposal of 
which, because of the composition or characteristics of the Waste or 
substance, is unlawful to treat, store or dispose of at the 
Acceptance or Disposal Facility or other facilities to be used in 
providing the Service and is considered hazardous Waste under 
Applicable Law, including, without limitation, Wastes that are:
    1. Regulated as a toxic or hazardous Waste as defined under 
either Subtitle C of the Solid Waste Disposal Act, 42 U.S.C. 
Secs. 6921-6939a, or Section 6(e) of the Toxic Substances Control 
Act, 15 U.S.C. Sec. 2605(e), as replaced, amended, expanded or 
supplemented, and any rules or regulations promulgated thereunder, 
or under the Environment Article of the Annotated Code of Maryland, 
Title 7, Section 7-101 et seq., as replaced, amended, expanded, or 
supplemented, and any rules or regulations promulgated thereunder; 
or
    2. Low level nuclear Wastes, special nuclear Wastes or nuclear 
by-product Wastes, all within the meaning of the Atomic Energy Act 
of 1954, as replaced, amended, expanded or supplemented, and any 
rules, regulations or policies promulgated thereunder.
    B. Any other Wastes which any Governmental Body or unit having 
appropriate jurisdiction shall lawfully determine, from time to 
time, to be ineligible for disposal through facilities of the type 
being used to provide the Service because of the harmful, toxic, or 
dangerous composition or characteristics of the Waste or substance. 
Any such designation would, under the Agreement, be considered an 
Uncontrollable Circumstance as defined in the Service Agreement.
    ``Hazardous Waste Costs'' means with respect to Hazardous Waste 
proven to have been delivered to a Facility by the Authority, a 
County or a Designated Hauler, the actual costs of the removal and 
disposal of such Hazardous Waste and all other costs and liabilities 
associated with or arising from the delivery, removal, or disposal 
or such Hazardous Waste; provided, that Hazardous Waste Costs do not 
include:
    (a) Any costs or liabilities incurred due to the Company's 
negligence, willful misconduct or failure to adhere to Applicable 
Law or the Hazardous Waste Protocol in connection with any Waste it 
knows or should know to be Hazardous Waste;
    (b) Any costs incurred by the Company for the operation or 
maintenance of a Facility as a result of the discovery of Hazardous 
Waste;
    (c) Any costs or liabilities paid by any third party or 
insurance policy.
    Hazardous Waste Costs also include the cost, if approved in 
writing by the Authority, of any repairs or alterations to a 
Facility necessitated by the presence or inadvertent Acceptance of 
such Hazardous Waste and all liabilities, damages, claims, demands, 
expenses, suits or actions including reasonable appeals, fines, 
penalties and attorney's fees in connection with any civil or 
administrative proceeding arising from the presence of such 
Hazardous Waste at a Facility or the removal or disposal of such 
Hazardous Wastes including, without limitation, any suit for 
personal injury to, or death of, any person or persons, or loss or 
damage to property resulting from the presence, removal, disposal or 
inadvertent processing of such Hazardous Waste.
    ``Holiday'' means those days listed in Section 2.3 for which an 
observance date is established by the Authority.
    ``Interim Period'' means July 1, 1996-December 31, 1996 during 
which time the Company shall provide Service to Anne Arundel County.
    ``Labor Action'' means a strike, lockout or other similar work 
shutdown or stoppage by workers.
    ``Late Payment Rate'' means an amount equal to Nations Bank N.A. 
prime rate of interest, as adjusted from time-to-time, plus two 
percent.
    ``Non-performing Party'' means a party to this Agreement who 
fails to perform any obligation or comply with any requirement of 
such party under this Agreement.
    ``Notice of Termination'' means a written notice requiring the 
termination of this Agreement due to an Event of Default pursuant to 
Article VI hereof that specifies the factual basis for such 
termination and the date on which this Agreement will terminate 
pursuant to Article VI hereof.
    ``Performance Bond'' means the performance bond relating to the 
provision of the Service in substantially the form set forth in 
Schedule 5.
    ``Person'' means any individual, corporation, partnership, joint 
venture, association, joint-stock company or unincorporated 
organization, or any government unit or agency or political 
subdivision not otherwise expressly named in this Agreement.
    ``Process'' means to separate, combine, combust, compost, 
compact, load or otherwise handle Waste delivered to a Facility in 
accordance with the Applicable Law.
    ``Receiving Hours'' means from 7:00 a.m. until 5:00 p.m. Monday 
through Saturday, (except Holidays) and until 7:00 p.m. on the first 
regular collection day following a Holiday, or such other hours as 
may be established in writing from time to time by the Authority 
Representative, the Company Representative and the County 
Representatives.
    ``Require Insurance'' means the types and amounts of insurance 
set forth in Schedule 6.
    ``Service'' means the acceptance, processing, transportation and 
disposal of Acceptable Waste delivered to the Company pursuant to 
this Agreement.
    ``Service Fee'' has the meaning set forth in Article III of this 
Agreement
    ``Subcontractor Default'' means the failure of any Subcontractor 
that is not an Affiliate of the Company or other subcontractor or 
supplier (except an Affiliate of the Company) selected with 
reasonable care to furnish labor, services, Waste or equipment.
    ``Termination Settlement Amount'' means an amount calculated in 
accordance with the formula set forth in Schedule 9.
    ``Ton'' means a ``short ton'' of two thousand (2,000) pounds.
    ``TPD'' means Tons Per Day.
    ``TPY'' means Tons Per Year.
    ``Unacceptable Waste'' means:
    (a) Hazardous Waste; and
    (b) That portion of solid Waste the disposal of which (i) may 
present a substantial endangerment to public health or safety, or 
(ii) would cause Applicable Law to be violated, or (iii) is likely 
to materially adversely affect the operation of a Facility; 
provided, however, that if such unacceptable Waste (other than 
Hazardous Waste) is delivered in quantities and concentrations as 
determined by the Authority and as part of normal collections so as 
not to have the effect described in clauses (i), (ii) and (iii) 
above it shall constitute Acceptable Waste unless otherwise directed 
by State or federal regulatory authorities. The Unacceptable Wastes 
described in this paragraph (b) shall include:
    (1) Pathological and biological Waste, explosives, medical and 
infectious Waste, cesspool and other human Waste, human and animal 
remains;
    (2) Large automobile and vehicular parts, trailers, agricultural 
equipment, marine vessels;

[[Page 51149]]

    (3) Oil sludge or liquid Wastes; and
    (4) Radioactive Wastes.
    ``Uncontrollable Circumstance'' means an event or condition 
listed in this definition, whether affecting the Authority, the 
Counties or the Company, that has, or may reasonably be expected to 
have, a material adverse effect on the operation of a Facility, if 
such event or condition is beyond the reasonable control, and not 
the result of willful or negligent action or a lack of due 
diligence, of the Non-performing Party relying thereon as 
justification for not performing any obligation or complying with 
any condition required of such party hereunder, for delaying such 
performance or compliance. The following events or conditions, and 
no others, shall constitute Uncontrollable Circumstances if they 
meet the requirements of the preceding sentence:
    (a) An act of God (but not including reasonably anticipated 
weather conditions for the geographic area of a Facility), 
hurricane, landslide, earthquake or similar occurrence, fire, 
explosion or other casualty, an act of the public enemy, war, 
insurrection, riot, general arrest or restraint of government and 
people, civil disturbance or similar occurrence, or sabotage 
committed at a Facility by a Person other than an employee or agent 
of, or visitor invited by, the Company or its Affiliates, or the 
Company's subcontractors of any tier;
    (b) The failure of the jurisdiction in which a Facility is 
situated or the appropriate federal or state agencies or public 
utilities having operational jurisdiction in the area or location of 
the Facility to provide and maintain and assure the maintenance of 
all utilities services (excluding sewerage and water lines) to the 
Facility for operation of the Facility, provided they are essential 
the Facility;
    (c) A non-Company or non-subcontractor Labor Action.
    (d) Any host fee or surcharge imposed by either Howard or Anne 
Arundel County after the bid submittal which applies to a solid 
Waste acceptance facility (which term is defined by Maryland 
Environmental Code Ann. Sec. 9-501(n)) located in either County.
    No other costs of any kind shall be considered an Uncontrollable 
Circumstance for the purposes of this Agreement.
    In no event will Subcontractor Default or a Company Labor Action 
constitute an Uncontrollable Circumstance.
    The term ``reasonable control'' includes investigation or 
planning that is required by sound management or industry practices. 
No change in any Applicable Law imposing or increasing any tax, fee, 
assessment or charge shall constitute an Uncontrollable 
Circumstance. Neither the Authority nor the Countries shall be 
liable for the loss of any benefits relating to the Service for any 
reason whatsoever, if any.
    ``Waste'' means solid Waste including Acceptable Waste, 
delivered to the Acceptance Facility by, or or behalf of, the 
Authority and the Counties.
    ``Waste Disposal Agreement'' means the Agreement between the 
Authority and each County.
    ``Waste Disposal Services Revenues'' means (i) all payments to 
the Authority by the Counties directly attributable to the Service, 
and (ii) all other receipts of the Authority directly attributable 
to the Service.
    ``Wrongfully Diverted Waste'' means any Waste delivered to the 
Company, but which is rejected by the Company for any reason other 
than as permitted pursuant to Section 2.2(a) or any other provision 
of the Service Agreement.

Schedule 3 to Service Agreement

Service Fees

    Bid Price for Waste Acceptance, Processing, Transportation and 
Disposal for July 1, 1996--December 31, 1996 for Anne Arundel 
County, January 1, 1997--December 31, 1999 for Howard and Anne 
Arundel Countries with three one-year renewal options held solely by 
the Counties with no inflation adjustment available and including 
the option Anne Arundel County reserves for itself to send 
additional tonnage to the Company during the term of the Service 
Agreement in an amount anywhere between 1-300 additional tons per 
day.

Bid Price--$33.00/ton

Schedule 4 To Service Agreement

Reporting Requirements

    The Company shall give the Authority Representative and the 
County Representatives the following reports and information at the 
times indicated below.
    The Company shall deliver the following information:
    A. Pre-Commencement Date Documents:

                      Pre-Commencement Date Reports
------------------------------------------------------------------------
                 Information                         Delivery date
------------------------------------------------------------------------
Copies of Required Insurance, Performance      Prior to Service
 Bond, Letter of Credit, Corporate Guarantee.   Agreement Execution
                                                Date.
------------------------------------------------------------------------

    B. Periodic Reports During Operations:

                   Periodic Reports During Operations
------------------------------------------------------------------------
                    Report                           Delivery date
------------------------------------------------------------------------
Monthly Performance Report (see Exhibit A to   Accompany Monthly Invoice
 this Schedule).                                for payment.
Scale Certification..........................  Once per year or more
                                                frequently if required
                                                by Applicable Law.
------------------------------------------------------------------------


                   Periodic Reports During Operations
------------------------------------------------------------------------
              Other information                      Delivery date
------------------------------------------------------------------------
Copies of permits and permit renewals          Within 5 (five) business
 subsequent to the permits submitted as part    days of receipt by or
 of the bid submittal.                          delivery to the Company.
Copies of all compliance reports and notices   Within 5 (five) business
 submitted to or received from authorities      days of receipt by or
 regulating the Facilities must be submitted    delivery to the Company.
 to the Authority. Any notices of violation
 or potential violation at the Facilities
 must be submitted to the Authority as well
 as any notice designating the Facility as a
 Superfund Site or notice of potential
 National Priority List designation.
Copies of all reports and notices submitted    Within 5 (five) business
 to or received from a host community           days of receipt by or
 pursuant to a host community agreement.        delivery to the Company.
 Copies of any amendments to any host
 community agreement for the Disposal
 Facility.
Reports or notices of environmental            Within 5 (five) business
 violations of Applicable Law or citations      days of receipt by or
 related to violations of Applicable Law        delivery to the Company.
 relating to the Facilities providing the
 Service.

[[Page 51150]]

Reports of lawsuits requesting declaratory,    Within 5 (five) business
 injunctive or other equitable relief and       days of receipt by or
 lawsuits in excess of $1,000,000 in which      delivery to the Company.
 the Company, its parent company, or
 affiliates is a party related to Facilities
 providing the Service. If the litigation
 involves any issues relating to the
 environment, the dispute must be reported
 without regard to monetary amount.
Any material adverse change in the financial   Within 5 (five) business
 condition of the Company or Guarantor, if      days of receipt by or
 applicable.                                    delivery to the Company.
Notice of any proposed transfer of ownership,  60 (sixty) days prior to
 possession, or control of the Company,         effective date of
 Guarantor, if applicable, or Facilities must   action.
 be given to the Authority. The notice must
 include identification of the transferee,
 and other information as specified in RFB
 Section 1.4.3 D.
Monitoring well water quality analysis and     Semi-annually.
 assessment monitoring reports as specified
 in RFB Section 1.4.3.H.
------------------------------------------------------------------------

Exhibit A To Schedule 4 To Service Agreement

Monthly Performance Report Forms

    The Company must complete the Monthly Tonnages Report Form in 
Schedule 4 and submit the form to the Authority and the Counties 
with the monthly invoice for payment.

------------------------------------------------------------------------
                                                   Month         Ytd
------------------------------------------------------------------------
                1. Tonnage \1\
Acceptable Waste Received:
    Anne Arundel County
    Howard County
Acceptable Waste Disposed:
    Anne Arundel County
    Howard County
Unacceptable Waste Received \2\:
    Anne Arundel County
    Howard County
Unacceptable Waste Disposed \2\:
    Anne Arundel County
    Howard County
  2. Out of Hours Deliveries (attach back-up
         data verifying delivery time)
Anne Arundel County
Howard County
------------------------------------------------------------------------
\1\ Include all scale records to correspond with the invoiced tonnages.
\2\ Describe how the Waste was handled, including copies of any
  manifests required by Applicable Law.

Schedule 5 To Service Agreement

Form of Performance Bonds

Performance Bond

----------------------------------------------------------------------
Principal

----------------------------------------------------------------------
Business Address of Principal

----------------------------------------------------------------------
Surety

----------------------------------------------------------------------
Obligee

a corporation of the State of ____________________ and authorized to 
do business in the State of Maryland.

Northeast Maryland Waste Disposal Authority and Anne Arundel County, 
Maryland, and Howard County, Maryland

----------------------------------------------------------------------
Penal Sum of Bond (express in words and figures)

Date of Contract: ________________, 19____
Date Bond Executed: ________________, 19____
    Service Agreement to provide Waste acceptance, processing, 
transportation and disposal.
  Contract Number:-----------------------------------------------------
    Know all men by these presents, That we, the Principal named 
above and Surety named above, are held and firmly bound unto the 
Obligee named above in the Penal Sum of this Performance Bond stated 
above, for the payment of which Penal Sum we bind ourselves, our 
heirs, executors, administrators, personal representatives, 
successors, and assigns, jointly and severally, firmly by these 
presents. However, where Surety is composed of corporations acting 
as co-sureties, we, the co-sureties, bind ourselves, our successors 
and assigns, in such Penal Sum jointly and severally as well as 
severally only for the purpose of allowing a joint action or actions 
against any or all of us, and for all other purposes each co-surety 
binds itself, jointly and severally with the Principal, for the 
payment of such sum as appears above its name below, but if no limit 
of liability is indicated, the limit of such ability shall be the 
full amount of the Penal Sum.
    Whereas, Principal has entered into or will enter into a 
contract with the Northeast Maryland Waste Disposal Authority (the 
``Authority''), which contract is described and dated as shown 
above, and incorporated herein by reference. The contract and all 
items incorporated into the contract, together with any and all 
changes, extensions of time, alterations, modifications, or 
additions to the contract or to the work to be performed thereunder 
or any of them, or to any other items incorporated into the contract 
shall hereinafter be referred to as ``the Agreement.''
    Now, therefore, during the term of said Agreement, this 
Performance Bond shall remain in full force and effect unless and 
until the following terms and conditions are met:
    1. Principal shall well and truly perform the Contract; and
    2. Principal and Surety shall comply with the terms and 
conditions in this Performance Bond.
    Whenever Principal shall be declared by the Authority to be in 
default under the Agreement, the Surety may within fifteen (15) days 
after notice of default from the Authority notify the Authority of 
its election

[[Page 51151]]

to either promptly proceed to remedy the default or promptly proceed 
to complete the contract in accordance with and subject to its terms 
and conditions. In the event the Surety does not elect to exercise 
either of the above stated options, then the Authority thereupon 
shall have the remaining contract work completed, Surety to remain 
liable hereunder for all expenses of completion up to but not 
exceeding the penal sum stated above.
    The Surety hereby stipulates and agrees that no change, 
extension of time, alteration or addition to the terms of the 
Agreement or to the work to be performed thereunder or the 
Specifications accompanying the same shall in any way affect its 
obligations on this Performance Bond, and it does hereby waive 
notice of any such change, extension of time, alteration or addition 
to the terms of the Agreement or to the work or to the 
Specifications.
    This Performance Bond shall be governed by and construed in 
accordance with the laws of the State of Maryland and any reference 
herein to Principal or Surety in the singular shall include all 
entities in the plural who or which are signatories under the 
Principal or Surety heading below.
    In witness whereof, Principal and Surety have set their hands 
and seals to this Performance Bond. If any individual is a signatory 
under the Principal heading below, then each such individual has 
signed below on his or her own behalf, has set forth below the name 
of the firm, if any, in whose name he or she is doing business, and 
has set forth below his or her title as a sole proprietor. If any 
partnership or joint venture is a signatory under the Principal 
heading below, then all members of each such partnership or joint 
venture have signed below, each member has set forth below his or 
her title as a general partner, limited partner, or member of joint 
venture, whichever is applicable. If any corporation is a signatory 
under the Principal or Surety heading below, then each such 
corporation has caused the following: the corporation's name to be 
set forth below, a duly authorized representative of the corporation 
to affix below the corporation's seal and to attach hereto a 
notarized corporate resolution or power of attorney authorizing such 
action, and each such duly authorized representative to sign below 
and to set forth below his or her title as a representative of the 
corporation. If any individual acts as a witness to any signature 
below, then each such individual has signed below and has set forth 
below his or her title as a witness. All of the above has been done 
as of the Date of Bond shown above.
    In Presence of:
----------------------------------------------------------------------
Witness
    Individual Principal
----------------------------------------------------------------------
    In Presence of: Witness
----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------

    Attest:
----------------------------------------------------------------------
Corporate Secretary

    Partnership Principal
----------------------------------------------------------------------
Name of Partnership

----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------
    Corporate Principal
----------------------------------------------------------------------
(Name of Corporation)

----------------------------------------------------------------------
President

Affix Corporate Seal
    Attest:
----------------------------------------------------------------------
Signature

----------------------------------------------------------------------
(Surety)

By:--------------------------------------------------------------------

Title:-----------------------------------------------------------------

Affix Corporate Seal
    Business Address of Surety:
----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------
    Bonding Agent's name:
----------------------------------------------------------------------

    Agent's Address:
----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------

    Approved as to legal form and sufficiency this ________ day of 
________________ 1996.

----------------------------------------------------------------------
Assistant Attorney General

Schedule 6 to Service Agreement

Required Insurance

    On and after the Commencement Date, the Company shall obtain and 
keep in force the following insurance with insurance companies 
licensed and qualified to do business in the State of Maryland rated 
at least ``A-'' or its equivalent by Best's Key Rating Guide, 
evidenced by a certificate of insurance and certified copies of all 
insurance policies.
    (a) Worker's Compensation.
    The Company shall maintain such insurance as required by 
Maryland Law covering all of its employees as will protect them and 
save the Counties and Authority harmless from claims. The Company 
shall maintain Employers' Liability Coverage in the following 
amounts: $500,000 for each accident; $500,000 for each disease per 
employee; $500,000 for bodily injury by disease policy aggregate and 
shall save the Counties and the Authority harmless from claims.
    (b) Commercial General Liability Insurance.
    The Company shall arrange and pay for a general liability policy 
which will protect the Authority, the Company and the County from 
public liability for any personal injury, including death or 
property damage which may arise from his operations or the 
operations of his Company and Sub-Contractors or by anyone directly 
or indirectly employed in the work by either of them under this 
Agreement, as follows:

$1,000,000 per occurrence for bodily injury and property damage
$1,000,000 aggregate for products and completed operations
$2,000,000 general aggregate (on a per project basis)
$1,000,000 per occurrence for personal & advertising injury 
liability

    There shall be no exclusions for explosion, collapse or 
underground exposures; the Company shall obtain contractual 
liability coverage, independent contractors coverage, broad from 
property damage coverage, and shall name the facility operator as an 
additional insured.
    (c) Business Automobile Liability Coverage.
    The Company shall maintain coverage which extends to all owned, 
leased, rented or borrowed automobiles in the amount of $1,000,000 
for each accident involving bodily injury and or property damage. 
Coverage must extend to include all monetary state and federal 
regulations as well as respects uninsured/underinsured motorists 
coverage, ICC, PUC filings and financial responsibility 
requirements.
    (d) Umbrella/Excess Liability coverage must be obtained in 
minimum amounts of $10,000,000 per occurrence and in the aggregate. 
Coverage must at a minimum follow form with applicable underlying 
insurance.
    (e) Professional Liability/Errors & Omissions insurance is 
required for all professional services performed under the contract 
in amounts customary for the profession.
    (f) Environmental Impairment Liability covering the Facilities.
    Company shall acquire and maintain Environmental Impairment 
Liability Insurance including sudden, non-sudden and gradual 
exposure, for all of Company's operations hereunder, including but 
not limited to disposal of Waste pursuant to this Agreement. Company 
shall purchase limits of $1 million per occurrence and $2 million 
annual aggregate for any release of toxics or hazardous Waste or 
other hazardous substance requiring monitoring, cleanup or 
corrective action under CERCLA. A combination of primary and excess 
coverage is acceptable, provided that there are no pollution 
exclusions in either policy.
    (g) All Companies and subcontractors must submit evidence of 
required insurance prior to performance.
    (h) Each Company must carry property damage insurance for all 
property owned, leased or loaned by the Company whether to be used 
in this project or not. Limits should equal the replacement value of 
such equipment and coverage must be on an ``all risk.''
    (i) The Company must provide the Authority with evidence that 
the disposal site owner carries insurance for site property damage. 
In addition, the Company must provide the Authority with evidence 
that the disposal site, if a landfill, carries environmental 
impairment liability insurance for that site of at least ten million 
dollars.

Section 2. General

    (a) The Authority and the Counties shall be named as additional 
insurers on the above Commercial General Liability and Environmental 
Impairment policies.

[[Page 51152]]

    (b) All losses under the required insurance shall be adjusted to 
the satisfaction of the Authority and the County.
    (c) The Company shall purchase commercial insurance for the 
above coverages. Approval for deductibles higher than $25,000 for 
the liability policies will be required from the Authority and the 
Counties.
    (d) All claims made policies shall provide a minimum of five (5) 
years' discovery period.
    (e) The Authority and the Counties shall be advised promptly in 
writing of the following change in the insurance policies:
    (i) Setting up a new retro date.
    (ii) Exhausting any aggregate limit under any of the above 
policies.
    (iii) Switching occurrence based coverage to claims made 
coverage or vice versa.
    (f) The Company shall assure that all subcontractors performing 
services in accordance with this Agreement carry identical coverages 
as required above, either individually or as an additional insured 
on the policies of the Company.

Schedule 7 To Service Agreement

Minority Business Participation Policy

    The Company shall comply with and meet the minority business 
participation requirements of the Authority, a copy of which is 
attached hereto.

Minority Business Enterprise--Terms and Conditions

For Municipal Solid Waste Acceptance, Processing, Transportation 
and Disposal Services

By the Northeast Maryland Waste Disposal Authority on Behalf of Anne 
Arundel County, Maryland and Howard County, Maryland

    Date: February 5, 1996.

I. MBE Program Goals

    The Authority will attempt to obtain the Project's MBE 
participation goals primarily through two mechanisms: by requiring 
prime Companies to utilize MBE as subcontractors/suppliers and by 
encouraging MBE to respond directly to this request for bids. 
Accordingly, the Authority's MBE participation percentage goal for 
this Project is 10% of the value of the contract.

II. Responsibilities

    The Executive Director of the Authority will be responsible for 
implementing, coordinating and monitoring the Project's MBE program.
    All bidders are expected to take positive steps to use MBEs. 
These positive efforts should consist of the following:
    a. Extending opportunities for subcontracting joint arrangements 
and material supplying to MBEs.
    b. Identifying in monthly reports to the Executive Director of 
the Authority the MBE firms to be used.
    c. Maintaining records of MBEs contacted, including negotiation 
efforts to reach competitive price levels and awards to MBEs.
    d. Requiring subcontracts under the contract to comply with the 
MBE policy.
    e. Keeping the Authority informed of all MBE sub-agreements or 
changes in plans to award subcontracts previously reported as 
proposed for MBEs.
    All Minority Business Enterprises are expected to take the 
following actions at a minimum:
    a. Become involved in the project planning and bid process.
    b. Provide capability statements to the Authority.
    c. All MBEs must be certified as MBEs by the State of Maryland 
or Howard County or Anne Arundel County.
    The Authority hereby notifies all bidders responding to this RFP 
that minority business enterprises will be afforded full opportunity 
to submit bids in response to this notice and will not be subjected 
to discrimination on the basis of race, color, sex or national 
origin in consideration of an award.
    After bid opening but prior to contract award, and execution of 
the Service Agreement, the apparent low bidder will be required to 
submit documentation showing minority participation.
    After a meeting with the apparent low bidder and evaluation of 
its compliance to the MBE requirement, the Authority will notify the 
bidder of the following:
    a. Final award of the contract.
    b. Apparent low bidders who fail to achieve the desired MBE 
participation can be declared ``non-responsive'' bidders in which 
case the next low bidders becomes the apparent low bidder. This 
process may be repeated until an apparent low bidder meeting the MBE 
requirement is obtained or the Authority may elect to rebid the 
Project to obtain both an equitable price and MBE compliance.

III. Contract Compliance Process

    a. The Authority will conduct periodic compliance reviews with 
all prime Companies required to comply with the MBE goal.
    b. Companies will be given prior notification of a pending on-
site verification and review for contract compliance. During such 
on-site review, the Company will have the following available for 
inspection:
    1. Copies of Purchase Orders and subcontracts containing EEO 
clauses.
    2. Records to indicate the number, names, dollar value of the 
minority subcontracts, the amount and dates and the scheduled times 
for each MBE to be on the job site.
    3. Any other appropriate documents requested prior to the on-
site visit.
    c. The on-site verification and interviews as a minimum will 
consist of the following:
    1. An initial meeting with the Company or his representative to 
explain visit objectives.
    2. Tour of the job site.
    3. Interviews of subcontractors, suppliers, etc.
    d. At the conclusion of the on-site visit an exit conference 
will be conducted. This conference will consist of a discussion of 
the compliance process and determination time frame, and suggestions 
for corrective action to be taken if necessary.
    e. A monthly report indicating compliance status will be 
prepared and forwarded to the Executive Director of the Authority.
    1. If a determination of noncompliance is made, the Authority 
may conduct further investigation. The Company will be notified and 
an attempt made informally to remedy any problems of compliance. In 
the event conciliation fails, the Authority will declare the Company 
in noncompliance.

IV. Enforcement

    If a Company fails or refuses to take corrective action, the 
Authority will determine which of the following should be imposed to 
promote the purpose of the Project's MBE Program.
    a. Declare an Event of Default under the contract (Service 
Agreement).
    b. Withhold a percentage of progress payment.
    c. Assess liquidated damages.
    d. Deny the Company or any subcontractor the right to 
participate in any future contracts awarded by the Authority.
    e. Other appropriate action within the discretion of the 
Executive Director of the Authority.
    This MBE policy document is hereby incorporated into the Service 
Agreement and failure to comply with its terms may be declared an 
event of default under Section 6.3(c) of the Service Agreement.

Schedule 8 to Service Agreement

Guaranty

    This Guaranty, dated as of ________________, 199____, is made by 
____________________ (``Guarantor''), to and for the benefit of the 
Northeast Maryland Waste Disposal Authority (the ``Authority'').

Recitals

    ____________________, (the ``Company'') and the Authority are 
entering into a Authority Agreement dated as of ________________, 
199____ (the ``Service Agreement'') under which the Company will 
provide Waste acceptance, processing, transportation and disposal 
services to the Authority. The Service Agreement is by reference 
incorporated in this Guaranty and made a part of it.
    The Guarantor has determined that it is in its best interests 
for the Company to enter into the Service Agreement with the 
Authority.
    The Authority is willing to enter into the Service Agreement 
only if the Guarantor executes this Guaranty and carries out its 
obligations under this Guaranty.
    The Guarantor is willing to guaranty, as set forth below, the 
performance of the Company under the Service Agreement.
    Now, therefore, as an inducement to the Authority to enter into 
the Service Agreement, and to and for their benefit, the Guarantor 
agrees as follows:
    1. Guarantee.
    The Guarantor hereby directly, unconditionally, irrevocably and 
absolutely guarantees the full and punctual performance by the 
Company of all the Company's obligations under the Service Agreement 
in accordance with its terms and conditions.
    2. Guarantee Absolute.
    The Guaranty provided for herein is absolute, unconditional and 
continuing, and the Authority shall be entitled to enforce any

[[Page 51153]]

and all obligations guaranteed hereby directly against the 
Guarantor. If the Company fails to perform any of its obligations 
contained in the Service Agreement, when and as the same is required 
to be performed, the Guarantor shall cause the performance of such 
obligation.
    3. Nature of Obligations.
    The Guarantor hereby agrees that at any time and from time to 
time, the Authority may, without in any manner affecting, impairing, 
lessening, modifying, waiving or releasing any or all of the 
obligations and liabilities of the Guarantor under this Guaranty, 
with or without notice to the Guarantor, modify, extend, amend, 
change, compromise, settle, release, terminate, waive, surrender or 
otherwise deal with in any manner satisfactory to the Authority, any 
or all of the provisions of the Service Agreement, so long as such 
action is taken in accordance with the Service Agreement.
    4. Subordination.
    The payment of any and all past, present and future 
indebtedness, liabilities and obligations of the Company to the 
Guarantor of every kind, nature and description is hereby 
subordinated and postponed by the Guarantor to the obligations set 
forth in the Service Agreement. The Guarantor agrees that the 
obligations under the Service Agreement shall have priority in 
payment, right and remedy over the subordinated obligations to the 
Guarantor. Nothing in this Section 4 shall impair the right of the 
Guarantor to receive dividends, distributions or any return of any 
capital investment or repayment of any loan made to the Company so 
long as there is not an Event of Default of the Company under any 
provision of the Service Agreement.
    5. Consent to Jurisdiction, Etc. This Guaranty shall be governed 
by and construed in accordance with the laws of the State of 
Maryland, and the Guarantor irrevocably submits to the jurisdiction 
of any state or federal court sitting in the State of Maryland over 
any suit, action or proceeding arising out of or relating to this 
Guaranty. The Guarantor hereby irrevocably designates and appoints [  
                  ], as the Guarantor's authorized agent to accept 
and acknowledge on the Guarantor's behalf service of process in any 
suit, action or proceeding of any nature referred to in this 
paragraph, provided that duplicate copies thereof be simultaneously 
delivered to the Guarantor.
    6. Maintenance of Corporate Existence and Credit Rating. The 
Guarantor must maintain and do or cause to be done all things 
necessary to preserve and keep in full force and effect its 
corporate existence and material rights and franchises. The 
Guarantor must not seek or permit the dissolution or liquidation of 
the Guarantor, in whole or in part, to merge into, consolidate with, 
enter into a joint venture or partnership with or in any way be 
acquired by any Person, unless the Guarantor is the surviving 
corporation, or unless this Guaranty is assumed, in its entirety, by 
the surviving corporation.
    7. No Set-Off, Etc.
    No set-off or counterclaim, reduction or diminution of, or 
defense of any kind to, any obligation of the Guarantor hereunder 
that the Guarantor may have against the Authority, shall be 
available to the Guarantor against the Authority to reduce its 
obligations under this Agreement unless it arises out of the Service 
Agreement.
    8. Notices.
    All notices and other communications hereunder shall be in 
writing and shall be delivered, or mailed by certified or registered 
mail, as follows:
    If to the Guarantor:
    With copy to:
    If to the Authority: Executive Director, Northeast Maryland 
Waste Disposal Authority, 25 S. Charles Street, Suite 2105, 
Baltimore, Maryland 21201-3330.
    With copy to:

or at such other addresses as any party shall furnish to the others 
in writing.
    9. Miscellaneous.
    9.1  The Authority or the counties may jointly or severally 
enforce the performance and observance of this Guaranty.
    9.2  No delay or omission to exercise any right, remedy, power 
or privilege accruing upon any default, omission or failure of 
performance hereunder shall impair any such right, remedy, power or 
privilege or be construed to be waiver thereof, but any such right, 
remedy, power or privilege may be exercised from time to time and as 
often as may be deemed expedient. In the event any provision 
contained in this Guaranty shall be breached by the Guarantor and 
thereafter duly waived in writing by the Authority, such waiver 
shall be limited to the particular breach so waived and shall not be 
deemed to waive any other breach hereunder. No waiver, amendment, 
release or modification of this Guaranty shall be established by 
conduct, custom or course of dealing, but solely by an instrument in 
writing duly executed by the Authority.
    9.3  This Guaranty may be executed simultaneously in several 
counterparts, each of which shall be deemed an original, and all of 
which together shall constitute one and the same instrument.
    9.4  The invalidity or unenforceability of any one or more 
provisions of the Guaranty shall not affect the validity or 
enforceability of the remaining portions of this Guaranty.
    9.5  This Guaranty shall terminate if all amounts payable or 
obligations to the Authority by the Company under the Service 
Agreement have been paid in full or performed, as the case may be, 
in accordance with the terms of the Service Agreement.
    9.6  This Guaranty is solely for the benefit of the Counties and 
the Authority and shall create no rights in favor of any other 
person, firm, corporation or governmental entity whatsoever.
    In witness whereof, the Guarantor has caused this Guaranty to be 
signed, sealed and delivered on the day and year first above 
written.
    The Company joins in the execution of this guaranty only so as 
to signify the Company's acceptance of and consent to the 
subordination provisions of Section 4 of this Guaranty.

Schedule 9 to Service Agreement

Termination Procedures and Costs

    1. If the Authority exercises its right to terminate this 
Agreement pursuant to Section 6, then the Authority will follow the 
termination for convenience process as set forth in COMAR 
21.07.01.12, which regulation is attached hereto.

Schedule 5 to Service Agreement

Form of Performance Bonds

Performance Bond

Bond No. ESD7617301

Principal: Sanifill, Inc./Garnet of Maryland

Business Address of Principal: 2777 Allen Parkway, Suite #700, 
Houston, TX 77019-2155

Surety: American Home Assurance Company

Obligee: Northeast Maryland Waste Disposal Authority

a corporation of the State of New York and authorized to do business 
in the State of Maryland.

Northeast Maryland Waste Disposal Authority and Anne Arundel County, 
Maryland and Howard County, Maryland

Penal Sum of Bond (express in words and figures): Six Million 
Seventy Eight Thousand Six Hundred and no/100--------Dollars 
($6,078,600.00)

Date of Contract: August 8, 1996
Date Bond Executed: August 6, 1996

    Service Agreement to provide Waste acceptance, processing, 
transportation and disposal.
  Contract Number:-----------------------------------------------------
    Know all men by these presents, That we, the Principal named 
above and Surety named above, are held and firmly bound unto the 
Obligee named above in the Penal Sum of this Performance Bond stated 
above, for the payment of which Penal Sum we bind ourselves, our 
heirs, executors, administrators, personal representatives, 
successors, and assigns, jointly and severally, firmly by these 
presents. However, where Surety is composed of corporations acting 
as co-sureties, we, the co-sureties, bind ourselves, our successors 
and assigns, in such Penal Sum jointly and severally as well as 
severally only for the purpose of allowing a joint action or actions 
against any or all of us, and for all other purposes each co-surety 
binds itself, jointly and severally with the Principal, for the 
payment of such sum as appears above its name below, but if no limit 
of liability is indicated, the limit of such ability shall be the 
full amount of the Penal Sum.
    Whereas, Principal has entered into or will enter into a 
contract with the Northeast Maryland Waste Disposal Authority (the 
``Authority''), which contract is described and dated as shown 
above, and incorporated herein by reference. The contract and all 
items incorporated into the contract, together with any and all 
changes, extensions of time, alterations, modifications, or 
additions to the contract or to the work to be performed thereunder 
or any of them, or to any other items incorporated into the contract 
shall hereinafter be referred to as ``the Agreement.''

[[Page 51154]]

    Now, therefore, during the term of said Agreement, this 
Performance Bond shall remain in full force and effect unless and 
until the following terms and conditions are met:
    1. Principal shall well and truly perform the Contract; and
    2. Principal and Surety shall comply with the terms and 
conditions in this Performance Bond.
    Whenever Principal shall be declared by the Authority to be in 
default under the Agreement, the Surety may within fifteen (15) days 
after notice of default from the Authority notify the Authority of 
its election to either promptly proceed to remedy the default or 
promptly proceed to complete the contract in accordance with and 
subject to its terms and conditions. In the event the Surety does 
not elect to exercise either of the above stated options, then the 
Authority thereupon shall have the remaining contract work 
completed, Surety to remain liable hereunder for all expenses of 
completion up to but not exceeding the penal sum stated above.
    The Surety hereby stipulates and agrees that no change, 
extension of time, alteration or addition to the terms of the 
Agreement or to the work to be performed thereunder or the 
Specifications accompanying the same shall in any way affect its 
obligations on this Performance Bond, and it does hereby waive 
notice of any such change, extension of time, alteration or addition 
to the terms of the Agreement or to the work or to the 
Specifications.
    This Performance Bond shall be governed by and construed in 
accordance with the laws of the State of Maryland and any reference 
herein to Principal or Surety in the singular shall include all 
entities in the plural who or which are signatories under the 
Principal or Surety heading below.
    In witness whereof, Principal and Surety have set their hands 
and seals to this Performance Bond. If any individual is a signatory 
under the Principal heading below, then each such individual has 
signed below on his or her own behalf, has set forth below the name 
of the firm, if any, in whose name he or she is doing business, and 
has set forth below his or her title as a sole proprietor. If any 
partnership or joint venture is a signatory under the Principal 
heading below, then all members of each such partnership or joint 
venture have signed below, each member has set forth below his or 
her title as a general partner, limited partner, or member of joint 
venture, whichever is applicable. If any corporation is a signatory 
under the Principal or Surety heading below, then each such 
corporation has caused the following: the corporation's name to be 
set forth below, a duly authorized representative of the corporation 
to affix below the corporation's seal and to attach hereto a 
notarized corporate resolution or power of attorney authorizing such 
action, and each such duly authorized representative to sign below 
and to set forth below his or her title as a representative of the 
corporation. If any individual acts as a witness to any signature 
below, then each such individual has signed below and has set forth 
below his or her title as a witness. All of the above has been done 
as of the Date of Bond shown above.
    In Presence of:
----------------------------------------------------------------------
Witness

    Individual Principal
----------------------------------------------------------------------

    In Presence of: Witness
----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------

    Partnership Principal
----------------------------------------------------------------------
Name of Partnership

----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------

    Attest: [Signature Illegible]

----------------------------------------------------------------------
Corporate Secretary

    Corporate Principal: Sanifill, Inc./Garnet of Maryland

----------------------------------------------------------------------
[Signature Illegible]

President/Controller

Affix Corporate Seal
    Witness: [Signature Illegible]

----------------------------------------------------------------------
Signature

(Surety): American Home Assurance Company
----------------------------------------------------------------------
Karen M. Kellner

Title: Attorney-in-Fact

Affix Corporate Seal

    Business Address of Surety: 70 Pine Street, New York, NY 10270.
    Bonding Agent's name: Marsh & McLennan, Inc.
    Agent's Address: 1000 Louisiana--#4000, Houston, TX 77002.
    Approved as to legal form and sufficiency this ________ day of 
________________ 1996.
----------------------------------------------------------------------
Assistant Attorney General

Endorsement ``A''

    Provided, however, that the Obligee accepts the bond subject to 
the following conditions and provisions:
    1. The bond is for the term beginning August 12, 1996 and ending 
August 12, 1997
    2. The bond may be extended for additional term(s) of twelve 
(12) months at the option of the surety, by continuation certificate 
executed by the surety. At no time will the period of exposure under 
the bonds exceed twelve (12) months. Notification of Non-Renewal 
shall be given by Certified Mail to the Obligee no later than thirty 
(30) days prior to the expiration date of the bonds. Failure of the 
surety to issue a Continuation Certificate or otherwise extend the 
term, shall not constitute a default under the Performance Bond.
    3. In the event of default by the Principal in performance of 
the contract during the term of the bond, the surety shall be liable 
only for the loss to the Obligee due to actual excess costs of 
performance of the contract up to the termination of the term of the 
bonds. Maximum aggregate liability of the surety is limited to the 
penal sum of the bond.
    4. Any suit under the Performance Bond must be instituted before 
the expiration of two (2) years from the last day of the term of the 
Performance Bond and any continuation hereof. If this limitation is 
made void by any law controlling the contract therof, such 
limitation shall be deemed to be amended to equal the minimum period 
of limitation permitted by such law.
    5. The bond is to secure the Principal's obligation as it 
relates to the Northeast Maryland Waste Authority/Sanifill, Inc.-
Garnet of Maryland Bond No. ESD7617301.
    The Power of Attorney form from American Home Assurance Co. is 
not being published in the Federal Register. A copy of the consent 
decree with this page included can be obtained from the Antitrust 
Division, Documents Group at 325 7th St., N.W., Rm 215, Washington, 
D.C. 20530 or (202) 514-2481

United States District Court, Northern District of Ohio, Eastern 
Division

    United States of America; State of Ohio; State of Arizona; State 
of California; State of Colorado; State of Florida; Commonwealth of 
Kentucky; State of Maryland; State of Michigan; State of New York; 
Commonwealth of Pennsylvania; State of Texas; State of Washington; 
and State of Wisconsin, Plaintiffs, v. USA Waste Services, Inc.; 
Dome Merger Subsidiary; and Waste Management, Inc., Defendants. 
Civil Action No. 1:98 CV 1616; Judge Aldrich. Filed July 23, 1998.

Competitive Impact Statement

    The United States, pursuant to Section 2(b) of the Antitrust 
Procedures and Penalties Act (``APPA''), 15 U.S.C. Sec. 16(b)-(h), 
files this Competitive Impact Statement relating to the proposed Final 
Judgment submitted for entry in this civil antitrust proceeding.

I. Nature and Purpose of the Proceeding

    On July 16, 1998, the United States, and the states of Ohio, 
Arizona, California, Colorado, Florida, Maryland, Michigan, New York, 
Texas, Washington and Wisconsin, and the commonwealths of Kentucky and 
Pennsylvania (``the governments'') filed a civil antitrust complaint, 
which alleges that the proposed acquisitions by USA Waste Services, 
Inc. (``USA Waste'') of Waste Management, Inc. (``WMI'') would violate 
Section 7 of the Clayton Act, 15 U.S.C. Sec. 18. The Complaint alleges 
that in many markets across the country, USA Waste and WMI are the two 
of the most significant competitors in commercial waste collection, or 
disposal of municipal solid waste (``MSW'') (i.e., operation of 
landfills, transfer stations and incinerators), or both services.
    The Complaint alleges that a combination of USA Waste and WMI would 
substantially lessen competition in commercial waste collection 
services in twelve highly concentrated, relevant

[[Page 51155]]

geographic markets: Akron, Cleveland and Columbus, Ohio; Allentown and 
Pittsburgh, Pennsylvania; Denver, Colorado; Detroit, Michigan; 
Gainesville, Florida; Houston, Texas; Louisville, Kentucky; Portland, 
Oregon; and Tucson, Arizona.
    The Complaint alleges the merger also would substantially lessen 
competition in disposal of municipal solid waste in seventeen highly 
concentrated markets: Akron/Canton, Cleveland and Columbus, Ohio; 
Baltimore, Maryland; Denver, Colorado; Detroit, Flint, and Northeastern 
Michigan; Houston, Texas; Los Angeles, California; Louisville, 
Kentucky; Miami, Florida; Milwaukee, Wisconsin; New York, New York; 
Pittsburgh and Philadelphia, Pennsylvania; and Portland, Oregon.
    According to the Complaint, the loss of competition would likely 
result in consumers paying higher prices and receiving fewer or lesser 
quality services for the collection and disposal of waste. The prayer 
for relief in the Complaint seeks: (1) a judgment that the proposed 
acquisition would violate Section 7 of the Clayton Cat; and (2) a 
permanent injunction that would prevent USA Waste from acquiring 
control of or otherwise combining its assets with WMI.
    At the same time the suit was filed, the governments also filed a 
proposed settlement that would permit USA Waste to complete its 
acquisition of WMI, but require it to divest certain waste collection 
and disposal assets in such a way as to preserve competition in the 
affected markers. This settlement consists of a Hold Separate 
Stipulation and Order, proposed Final Judgment, and a letter that 
outlines defendants' views as to which commercial waste collection 
routes should be divested and that sets forth the standard by which the 
governments determined whether routes that serve a given geographic 
area should be divested under the Judgment.\1\
---------------------------------------------------------------------------

    \1\ A copy of this correspondence appears in Appendix B. 
Defendants are required to divest front end loader (FEL) commercial 
waste collection routes that serve certain geographic areas 
specified in the Judgment. Since some FEL routes may serve more than 
one area, the governments agreed to apply a de minimis standard for 
determining whether defendants' routes that serve a given area are 
subject to divestiture under the Judgment. If a defendant's FEL 
route obtained 10% or more of its commercial revenues form a 
geographic area set forth in the Judgment, Secs. II(D)(1)-(12), in 
the route's most recent year of operation, defendants must divest 
the FEL route. Applying this rule in Detroit, for instance, would 
require defendants to divest any WMI FEL commercial route from which 
10 percent or more of its revenues derive from customers located in 
either the City of Detroit or Wayne County, MI.
    Defendants USA Waste and WMI have specifically identified and 
listed the FEL commercial routes they believe must be divested under 
the Judgment. The governments, however, have not verified 
defendants' representations.
---------------------------------------------------------------------------

    The proposed Final Judgment orders USA Waste and WMI to divest 
commercial waste collection routes in each of the relevant areas in 
which the Complaint alleges the merger would substantially reduce 
competition in commercial waste collection services. In addition, the 
Judgment orders USA Waste and WMI to divest landfills, transfer 
stations, or disposal rights in such facilities in each of the relevant 
markets in which the merger would substantially reduce competition in 
disposal of municipal solid waste. (A summary of the commercial waste 
collection and waste disposal assets that defendants must divest 
pursuant to the Judgment appears below in Appendix A.) USA Waste and 
WMI must complete their divestitures of the waste collection and 
disposal assets within 120 days, or five days after entry of the Final 
Judgment, whichever is later.
    The Hold Separate Stipulation and Order (``Hold Separate Order'') 
and the proposed Final Judgment ensure that until the divestitures 
mandated by the Judgment are accomplished, the currently operable waste 
collection and disposal assets that are to be divested, whether owned 
by USA Waste or WMI, will be maintained and operated as saleable, 
economically viable, ongoing concerns, with competitively sensitive 
business information and decision-making divorced from that of the 
combined company. USA Waste and WMI will appoint a person or persons to 
manage the operations to be divested and ensure the parties' compliance 
with the requirements of the proposed Judgment and Hold Separate Order.
    The parties have stipulated that the proposed Final Judgment may be 
entered after compliance with the APPA. Entry of the proposed Judgment 
would terminate this action, except that the Court would retain 
jurisdiction to construe, modify or enforce the provisions of the 
proposed Judgment and to punish violations thereof.

II. Description of the Events Giving Rise to the Violation Alleged 
in the Complaint

A. The Defendants and the Proposed Transaction

    USA Waste is the third largest waste collection and disposal firm 
in the United States. Based in Houston, Texas, it provides waste 
collection and disposal services throughout the country. In 1997, USA 
Waste's total operating revenues exceeded $2.6 billion.
    WMI, based in Oak Brook, Illinois, is the nation's largest waste 
collection and disposal firm. it also provides waste collection and 
disposal services throughout the country, often in direct competition 
with USA Waste. In 1997, WMI had total operating revenues of over $9 
billion.
    In March 1998, USA Waste announced its agreement to acquire WMI in 
a stock transaction worth nearly $14 billion. This transaction, which 
would combine two of the nation's largest waste collection and disposal 
firms and substantially increase concentration in a number of already 
highly concentrated, difficult-to-enter markets, precipitated the 
governments' suit.

B. The Competitive Effects of the Transaction

    Waste collection firms, or ``haulers,'' contract to collect 
municipal solid waste (``MSW'') from residential and commercial 
customers; they transport the waste to private and public disposal 
facilities (e.g., transfer stations, incinerators and landfills), 
which, for a fee, process and legally dispose of waste. USA Waste and 
WMI compete in operating waste collection routes and waste disposal 
facilities.
1. The Effects of the Transaction on Competition in the Markets for 
Commercial Waste Collection
    Commercial waste collection is the collection of MSW from 
commercial businesses such as office and apartment buildings and retail 
establishments (e.g., stores and restaurants) for shipment to, and 
disposal at, an approved disposal facility. Because of the type and 
volume of waste generated by commercial accounts and the frequency of 
service required, haulers organize commercial accounts into special 
routes, and use specialized equipment to store, collect and transport 
waste from these accounts to approved disposal sites. This equipment--
one to ten cubic yard containers for waste storage, and front-end 
loader vehicles for collection and transportation--is uniquely well 
suited to commercial waste collection service. Providers of other types 
of waste collection services (e.g., residential and roll-off services) 
are not good substitutes for commercial waste collection firms. In 
their waste collection efforts, other firms use different waste storage 
equipment (e.g., garbage cans or semi-stationary roll-off containers) 
and different vehicles (e.g.,) rear- or side-load trucks), which for a 
variety of reasons, cannot be conveniently or efficiently used to 
store, collect or transport waste generated by

[[Page 51156]]

commercial accounts, and hence, are rarely used on commercial waste 
collection routes. For purposes of antitrust analysis, commercial waste 
collection constitutes a line of commerce, or relevant service, for 
analyzing the effects of the merger.
    The Complaint alleges, that provision of commercial waste 
collection services takes place in compact, highly localized geographic 
markets. it is expensive to ship waste long distances in either 
collection or disposal operations. To minimize transportation costs and 
maximize the scale, density, and efficiency of their waste collection 
operations, commercial waste collection firms concentrate their 
customers and collection routes in small areas, often limited to 
metropolitan area. Firms with operations concentrated in distant area 
cannot easily compete against firms whose routes and customers are 
locally based. Sheet distance may significantly limit a distant firm's 
ability to provide commercial waste collection service as frequently or 
conveniently as that offered by local firms with nearby routes. Also, 
local commercial waste collection firms have significant cost 
advantages over other firms, and can profitably increase their charges 
to local commercial customers without losing significant sales to firms 
outside the area.
    Applying that analysis, the Complaint alleges that twelve areas--
Akron, Cleveland and Columbus, Ohio; Allentown and Pittsburgh, 
Pennsylvania; Denver, Colorado; Detroit, Michigan; Gainesville, 
Florida; Houston, Texas; Louisville, Kentucky; Portland, Oregon; and 
Tucson, Arizona--constitute sections of the country, or relevant 
geographic markets, for the purpose of assessing the competitive 
effects of a combination of USA Waste and WMI in the provision of 
commercial waste collection services. In each of these markets, USA 
Waste and MWI are two of the largest competitors, and the combined firm 
would command from 50 to 90 percent or more of total market revenues. 
These twelve commercial waste collection markets generate from $2 
million to well over $45 million in annual revenues.
    Significant new entry into these markets would be difficult, time 
consuming, and is unlikely to occur soon. Many customers of commercial 
waste collection firms have entered into ``evergreen'' contracts, tying 
them to a market incumbent for indefinitely long periods of time. In 
competing for uncommitted customers, market incumbents can price 
discriminate, i.e., selectively (and temporarily) charge unbeatably low 
prices to customers targeted by entrants, a tactic that would strongly 
discourage a would-be competitor from competing for such accounts, 
which, if won, may be very unprofitable to serve. The existence of long 
term contracts and price discrimination substantially increases any 
would-be new entrant's costs and time necessary for it to build its 
customer base and obtain efficient scale and route density to become an 
effective competitor in the market.
    The Complaint alleges that a combination of USA Waste and WMI would 
likely lead to an increase in prices charged to consumers of commercial 
waste collection services. The acquisition would diminish competition 
by enabling the few remaining competitors to engage more easily, 
frequently, and effectively in coordinated pricing interaction that 
harms consumers. This is especially troublesome in markets where entry 
has not proved an effective deterrent to the exercise of market power.
2. The Effects of the Transaction on Competition in the Markets for 
Disposal of Municipal Solid Waste
    A number of federal, state and local safety, environmental, zoning 
and permit laws and regulations dictate critical aspects of storage, 
handling, transportation, processing and disposal of MSW. MSW can only 
be sent for disposal to a transfer station, sanitary landfill, or 
incinerator permitted to accept MSW. Anyone who attempts to dispose of 
MSW in a facility that has not been approved for disposal of such waste 
risks severe civil and criminal penalties. Firms that compete in the 
disposal of MSW can profitably increase their charges to haulers for 
disposal of MSW without losing significant sales to other firms. For 
these reasons, there are no good substitutes for disposal of MSW.
    Disposal of MSW tends to occur in highly localized markets.\2\ 
Disposal costs are a significant component of waste collection 
services, often comprising 40 percent or more of overall operating 
costs. It is expensive to transport waste significant distances for 
disposal. Consequently, waste collection firms strongly prefer to send 
waste to local disposal sites. Sending a vehicle to dump waste at a 
remote landfill increases both the actual and opportunity costs of a 
hauler's collection service. Natural and man-made obstacles (e.g., 
mountains and traffic congestion), sheer distance and relative 
isolation from population centers (and collection operations) all 
substantially limit the ability of a remote disposal site to compete 
for MSW from closer, more accessible sites. Thus, waste collection 
firms will pay a premium to dispose of waste at more convenient and 
accessible sites. Operators of such disposal facilities can--and do--
price discriminate, i.e., charge higher prices to customers who have 
fewer local options for waste disposal.
---------------------------------------------------------------------------

    \2\ Though disposal of municipal solid waste is primarily a 
local activity, in some densely populated urban areas there are few, 
if any, local landfills or incinerators available for final disposal 
of waste. In these areas, transfer stations are the principal 
disposal option. A transfer station collects, processes and 
temprarily stores waste for later bulk shipment by truck, rail or 
barge to a more distant disposal site, typically a sanitary 
landfill, for final disposal. In such markets, local transfer 
stations compete for municipal solid waste for processing and 
temporary storage, and sanitary landfills may compete in a broader 
regional market for permanent disposal of area waste.
    The Complaint in this case alleges that in three relevant 
areas--New York, NY; Baltimore, MD; and Philadelphia, PA--transfer 
stations are the principal method for disposal of MSW. In other 
markets (e.g., Miami, Louisville, Akron, Cleveland and Columbus), 
distant landfills may compete with local disposal facilities 
(incinerators or landfills) through the use of transfer stations. 
Regional landfills also compete for permanent disposal of waste from 
these areas. In some areas, however, the proposed Final Judgment 
requires defendants to divest transfer stations because such 
divestures may aid in the competitive viability of a companion 
landfill, the divestiture of which, the governments believe, is 
essential for effective relief.
---------------------------------------------------------------------------

    For these reasons, the Complaint alleges that, for purposes of 
anitrust analysis, seventeen areas--Akron/Canton, Cleveland and 
Columbus, OH; Baltimore, MD; Denver, CO; Detroit, Flint, and 
Northeastern Michigan; Houston, TX; Los Angeles, CA; Louisville, KY; 
Miami, FL; Milwaukee, WI; New York, NY; Pittsburgh and Philadelphia, 
PA; and Portland, OR--are relevant geographic markets for disposal of 
municipal solid waste. In each of these markets, USA Waste and WMI are 
two of only a few significant competitors. Their combination would 
command from over 50 to well over 90 percent of disposal capacity for 
municipal solid waste, in markets that generate annual disposal 
revenues of from $10 million to over $200 million annually.
    Entry into the disposal of municipal solid waste is difficult. 
Government permitting laws and regulations make obtaining a permit to 
construct or expand a disposal site an expensive and time-consuming 
task. Significant new entry into these markets is unlikely to occur in 
any reasonable period of time, and is not likely to prevent exercise of 
market power after the acquisition.
    In each listed market, USA Waste's acquisition of WMI would remove 
a significant competitor in disposal of

[[Page 51157]]

municipal solid waste. With the elimination of WMI, market incumbents 
will no longer compete as aggressively since they will not have to 
worry about losing busines to WMI. The resulting substantial increase 
in concentration, loss of competition, and absence of reasonable 
prospect of significant new entry or expansion by market incumbents 
likely ensure that consumers will pay substantially higher prices for 
disposal of MSW, collection of commercial waste, or both, following the 
acquisition.

III. Explanation of the Proposed Final Judgment

    The relief described in the proposed Final Judgment will eliminate 
the anticompetitive effect of the acquisition in commercial waste 
collection in and disposal of MSW from the relevant markets by 
establishing new, independent and economically viable competitors in 
each affected market. The proposed Final Judgment requires USA Waste 
and WMI, within 120 days after the filing of the Complaint in this 
matter, or five days after notice of the entry of this Final Judgment 
by the Court, whichever is later, to sell certain commercial waste 
collection assets (``Relevant Hauling Assets'') and disposal assets 
(``Relevant Disposal Assets'') as viable, ongoing businesses to a 
purchaser or purchasers acceptable to the United States, in its sole 
discretion, after consultation with the relevant state. The collection 
assets to be divested include front-end loader commercial waste 
collection routes, trucks and customer lists. The disposal assets to be 
divested include landfills, transfer stations, disposal rights in such 
facilities, and certain other assets (e.g., leasehold and renewal 
rights in the particular landfill or transfer station, garages and 
offices, trucks and vehicles, scales, permits, and intangible assets 
such as landfill or transfer station-related customer lists and 
contracts).
    If USA Waste and WMI cannot accomplish the divestitures within the 
prescribed time, the Final Judgment provides that, upon application of 
the United States, the Court will appoint a trustee to complete the 
divestiture of each relevant disposal asset or relevant hauling asset 
not sold. The proposed Final Judgment provides that the assets must be 
divested in such a way as to satisfy the United States, in its sole 
discretion, after consultation with the relevant state, that the assets 
can and will be used by the purchaser as part of a viable, ongoing 
business or businesses engaged in waste collection or disposal that can 
compete effectively in the relevant area. Defendants must take all 
reasonable steps necessary to accomplish the divestitures, and shall 
cooperate with bona fide prospective purchasers and, if one is 
appointed, with the trustee.
    If a trustee is appointed, the proposed Final Judgment provides 
that USA Waste and WMI will pay all costs and expenses of the trustee. 
The trustee's commission will be structured so as to provide an 
incentive for the trustee based on the price obtained and the speed 
with which the divestitures are accomplished. After his or her 
appointment becomes effective, the trustee will file monthly reports 
with the parties and the Court, setting forth the trustee's efforts to 
accomplish the divestitures. At the end of six months, if the 
divestitures have not been accomplished, the trustee and the parties 
will make recommendations to the Court which shall enter such orders as 
appropriate in order to carry out the purpose of the trust, including 
extending the trust or the term of the trustee's appointment.

IV. Remedies Available to Potential Private Litigants

    Section 4 of the Clayton Act (15 U.S.C. Sec. 15) provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal court to recover three times 
the damages the person has suffered, as well as costs and reasonable 
attorney's fees. Entry of the proposed Final Judgment will neither 
impair nor assist the bringing of any private antitrust damage action. 
Under the provisions of Section 5(a) of the Clayton Act (15 U.S.C. 
Sec. 16(a)), the proposed Final Judgment has no prima facie effect in 
any subsequent private lawsuit that may be brought against defendant.

V. Procedures Available for Modification of the Proposed Final 
Judgment

    The United States and defendants have stipulated that the proposed 
Final Judgment may be entered by the Court after compliance with the 
provisions of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry of the decree upon the 
Court's determination that the proposed Final Judgment is in the public 
interest.
    The APPA provides a period of at least 60 days preceding the 
effective date of the proposed Final Judgment within which any person 
may submit to the United States written comments regarding the proposed 
Final Judgment. Any person who wishes to comment should do so within 
sixty (60) days of the date of publication of this Competitive Impact 
Statement in the Federal Register. The United States will evaluate and 
respond to the comments. All comments will be given due consideration 
by the Department of Justice, which remains free to withdraw its 
consent to the proposed Judgment at any time prior to entry. The 
comments and the response of the United States will be filed with the 
Court and published in the Federal Register. Written comments should be 
submitted to: J. Robert Kramer II, Chief, Litigation II Section, 
Antitrust Division, United States Department of Justice, 1401 H Street, 
NW, Suite 3000, Washington, DC 20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Judgment.

VI. Alternatives to the Proposed Final Judgment

    The United States considered, as an alternative to the proposed 
Final Judgment, a full trial on the merits against defendants USA Waste 
and WMI. The United States could have brought suit and sought 
preliminary and permanent injunctions against USA Waste's acquisition 
of WMI. The United States is satisfied, however, that defendants' 
divestiture of the assets described in the Judgment will establish, 
preserve and ensure viable competitors in each of the relevant markets 
identified by the governments. To this end, the United States is 
convinced that the proposed relief, once implemented by the Court, will 
prevent USA Waste's acquisition of WMI from having adverse competitive 
effects.

VII. Standard of Review Under the APPA for Proposed Final Judgment

    The APPA requires that proposed consent judgments in antitrust 
cases brought by the United States be subject to a sixty-day comment 
period, after which the court shall determine whether entry of the 
proposed Final Judgment ``is in the public interest.'' In making that 
determination, the court may consider--
    (1) The competitive impact of such judgment, including termination 
of alleged violations, provisions for enforcement and modification, 
duration or relief sought, anticipated effects of alternative remedies 
actually considered, and any other considerations bearing upon the 
adequacy of such judgment;

[[Page 51158]]

    (2) The impact of entry of such judgment upon the public generally 
and individuals alleging specific injury from the violations set forth 
in the complaint including consideration of the public benefit, if any, 
to be derived from a determination of the issues at trial.
    15 U.S.C. Sec. 16(e) (emphasis added). As the Court of Appeals for 
the District of Columbia Circuit recently held, the APPA permits a 
court to consider, among other things, the relationship between the 
remedy secured and the specific allegations set forth in the 
government's complaint, whether the decree is sufficiently clear, 
whether enforcement mechanisms are sufficient, and whether the decree 
may positively harm third parties. See United States v. Microsoft, 56 
F.3d 1448 (D.C. Cir. 1995).
    In conducting this inquiry, ``the Court is nowhere compelled to go 
to trial or to engage in extended proceedings which might have the 
effect of vitiating the benefits of prompt and less costly settlement 
through the consent decree process.'' \3\ Rather.

    \3\ 119 Cong. Rec. 24598 (1973). See, United States v. Gillette 
Co., 406 F. Supp. 713, 715 (D. Mass. 1975). A ``public interest'' 
determination can be made properly on the basis of the Competitive 
Impact Statement and Response to Comments filed pursuant to the 
APPA. Although the APPA authorizes the use of additional procedures, 
15 U.S.C. Sec. 16(f), those procedures are discretionary. A court 
need not invoke any of them unless it believes that the comments 
have raised significant issues and that further proceedings would 
aid the court in resolving those issues. See, H.R. 93-1463, 93rd 
Cong. 2d Sess. 8-9, reprinted in (1974) U.S. Code Cong. & Ad. News 
6535, 6538.
---------------------------------------------------------------------------

absent a showing of corrupt failure of the government to discharge 
its duty, the Court, in making its public interest finding, should * 
* * carefully consider the explanations of the government in the 
competitive impact statement and its responses to comments in order 
to determine whether those explanations are reasonable under the 
circumstances.

    United States v. Mid-America Dairymen, Inc., 1977-1 Trade Cas. 
para. 61,508, at 71,980 (W.D. Mo. 1977).
    Accordingly, with respect to the adequacy of the relief secured by 
the decree, a court may not ``engage in an unrestricted evaluation of 
what relief would best serve the public.'' United States v. BNS, Inc., 
858 F.2d 456, 462 (9th Cir. 1988) quoting United States v. Bechtel 
Corp., 648 F.2d 660, 666 (9th Cir.), cert. denied, 454 U.S. 1083 
(1981); see also, Microsoft, 56 F.3d 1448 (D.C. Cir. 1995). Precedent 
requires that

the balancing of competing social and political interests affected 
by a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's 
role in protecting the public interest is one of insuring that the 
government has not breached its duty to the public in consenting to 
the decree. The court is required to determine not whether a 
particular decree is the one that will best serve society, but 
whether the settlement is ``within the reaches of the public 
interest.'' More elaborate requirements might undermine the 
effectiveness of antitrust enforcement by consent decree.\4\
---------------------------------------------------------------------------

    \4\ United States v. Bechtel, 648 F.2d at 666 (citations 
omitted) (emphasis added); see United States v. BNS, Inc., 858 F.2d 
at 463; United States v. National Broadcasting Co., 449 F. Supp. 
1127, 1143 (C.D. Cal. 1978); United States v. Gillette Co., 406 F. 
Supp. at 716. See also United States v. American Cyanamid Co., 719 
F.2d at 565.

    The proposed Final Judgment, therefore, should not be reviewed 
under a standard of whether it is certain to eliminate every 
anticompetitive effect of a particular practice or whether it mandates 
certainty of free competition in the future. Court approval of a final 
judgment requires a standard more flexible and less strict than the 
standard required for a finding of liability. ``[A] proposed decree 
must be approved even if it falls short of the remedy the court would 
impose on its own, as long as it falls within the range of 
acceptability or is `within the reaches of public interest.' (citations 
omitted.'' \5\
---------------------------------------------------------------------------

    \5\ United States v. American Tel. and Tel. Co., 552 F. Supp. 
131, 150 (D.D.C. 1982), aff'd sub nom. Maryland v. United States, 
460 U.S. 1001 (1983) quoting United States v. Gillette Co., supra, 
406 F. Supp. at 716; United States v. Alcan Aluminum, Ltd., 605 F. 
Supp. 619, 622 (W.D. Ky 1985).
---------------------------------------------------------------------------

VIII. Determinative Documents

    There are no determinative materials or documents within the 
meaning of the APPA that were considered by the United States in 
formulating the proposed Final Judgment.

    Dated: July 22, 1998.

        Respectfully submitted,
Anthony E. Harris,
Illinois Bar No. 1133713. U.S. Department of Justice, Antitrust 
Division, Litigation II Section, 1401 H Street, NW, Suite 3000, 
Washington, DC 20530, (202) 307-6583.

Appendix A--Summary of Waste Disposal and Collection Assets That Must 
be Divested Under the Proposed Final Judgment

II. Waste Disposal Assets

    The proposed Final Judgment (Secs. II(C)(1) and (2), IV and V) 
requires USA Waste and WMI to divest certain ``relevant disposal 
assets.'' In general, this means, with respect to each landfill or 
transfer station, all tangible assets, including the garage and 
related facilities; offices; landfill-related or transfer station-
related assets including capital equipment, trucks and other 
vehicles, scales, permits, and supplies, and all intangible assets 
of the landfill or transfer station, including landfill-related or 
transfer station-related customer lists, contracts, and accounts, or 
options to purchase any adjoining property. The list of disposal 
facilities that must be divested includes properties and permits in 
the following locations, under the listed terms and conditions:

A. Landfills and Airspace Disposal Rights

1. Akron/Canton, OH

    WMI's Countrywide R&D Landfill, located at 3619 Gracemont 
Street, SW, East Sparta, OH 44626 (known as the ``Countrywide 
Landfill'');

2. Columbus, OH

    USA Waste's Pine Grove Landfill, located at 5131 Drinkle Road, 
SW, Amanda, OH 43102;

3. Denver, CO

    USA Waste's Front Range Landfill, located at 1830 County Road 5, 
Erie, CO 80516-8005; and at purchaser's option, a two-year waste 
supply agreement that would require defendants to dispose of a 
minimum of 150 tons/day of waste at the Front Range Landfill, at 
disposal fees to be negotiated between purchaser and defendants;

4. Detroit, MI

    USA Waste's Carleton Farms Landfill, located at 28800 Clark 
Road, New Boston, MI, subject to two conditions, viz, USA Waste's 
obligations to (1) dispose of ash from the Greater Detroit Resource 
Recovery Center's incinerator at a separate monofill cell on this 
site pursuant to an existing contract, and (2) dispose of waste from 
the Greater Detroit Resource Recovery Center's bypass transfer 
station at this landfill, until defendants transfer such obligation 
to another landfill, which they shall use their best efforts to 
accomplish expeditiously;

5. Flint, MI

    USA Waste's Brent Run Landfill, located at Vienna Road, Montrose 
Township, Genesee County, MI;

6. Houston, TX

    (1) USA Waste's Brazoria County Landfill, located at 10310 FM-
523, Angleton, TX 77515; and
    (2) Airspace disposal rights at WMI's Security Landfill, located 
at 19248 Highway 105E, Cleveland, TX, or WMI's Atascocita Landfill, 
located at 2020 Atascocita Road, Humble, TX, or both, pursuant to 
which defendants will sell to one or more purchasers rights to 
dispose of at least 3.0 million tons of waste, over a ten-year 
period.

7. Los Angeles, CA

    USA Waste's Chiquita Canyon Landfill, located at 29201 Henry 
Mayo Drive, Valencia, CA 91355;

8. Louisville, KY

    USA Waste's Valley View Landfill, located at 9120 Sulphur Road, 
Sulphur, KY 40070;

9. Miami, FL

    Airspace disposal rights at USA Waste's Okeechobee Landfill, 
controlled by a subsidiary of USA Waste, and located at 10800 NE 
128th Avenue, Okeechobee, FL 34972, pursuant to which defendants 
will sell a total of 4.3 million tons of airspace, over a 20-year 
time period, to one or more purchasers.

[[Page 51159]]

10. Milwaukee, WI

    USA Waste's Kestrel Hawk Landfill, located at 1989 Oakes Road, 
Racine, WI 53406; and WMI's Mallard Ridge Landfill, located at W. 
8470 State Road 11, Delavan, WI 53115;

11. New York, NY/Philadelphia, PA

    WMI's Modern Landfill & Recycling, located at 4400 Mt. Piscah 
Road, York, PA 17402, and known as the ``Modern Landfill'';

12. Northeast Michigan

    USA Waste's Whitefeather Landfill, located at 2401 Whitefeather 
Road, Pinconning, MI; and Elk Run Sanitary Landfill, located at 
20676 Five Mile Highway, Onaway, MI;

13. Pittsburgh, PA

    WMI's Green Ridge Landfill, located at 717 East Huntington 
Landfill Road, Scottsdale, PA 15683 (variously known as the ``Green 
Ridge Landfill,'' the ``Y&S Landfill,'' or the ``Greenridge 
Reclamation Landfill'');

14. Portland, OR

    USA Waste's North WASCO Landfill, located at 2550 Steele Road, 
The Dalles, OR 97058; and

B. Transfer Stations, Disposal Rights and Throughput Agreements

1. Akron/Canton, OH

    Throughout disposal rights of a maximum of 400 tons/day of 
waste, for a ten-year time period, at WMI's Akron Central Transfer 
Station, located at 389 Fountain Street, Akron, OH, under the 
following terms and conditions;
    (a) The purchaser (or its designee) can deliver waste to the 
Akron Central Transfer Station for processing and, at the 
purchaser's option, load the processed waste into the purchaser's 
(or its designee's) vehicles for disposal;
    (b) For each purchaser of such disposal rights (or its 
designee), defendants must commit to operate the listed Akron 
Central Transfer Station's gate, scale house, and disposal area 
under terms and conditions no less favorable than those provided to 
defendants' own vehicles or to the vehicles of any municipality in 
Ohio, except as to price and credit terms;

2. Baltimore, MD

    Disposal rights of at least 600 tons of waste/day, pursuant to 
which defendants will sell to one or more purchasers rights to 
dispose, for a five-year time period, under the following terms and 
conditions:
    (a) The purchaser(s) or its designee(s) may dispose of waste at 
any one or any combination of the following facilities, as specified 
in its purchase agreement: Southwest Resource Recovery Facility 
(known as ``Baltimore RESCO'' or ``BRESCO''), located at 1801 
Annapolis Road, Baltimore, MD 21230; Baltimore County Resource 
Recovery Facility, located at 10320 York Road, Cockeysville, MD; 
Western Acceptance Facility, located at 3310 Transway Road, 
Baltimore, MD; or Annapolis Junction Transfer Station, located at 
8077 Brock Bridge Road, Jessup, MD 20794. If more than one person 
purchases the disposal rights, the minimum daily disposal rates, and 
the total of all purchasers' maximum disposal amounts at all 
facilities specified shall be no less than 600 tons/day;
    (b) For each purchaser of disposal rights (or its designee), 
defendants must commit to operate the listed Baltimore, MD area 
facilities' gates, scale houses, and disposal areas under terms and 
conditions no less favorable than those provided to defendants' own 
vehicles or to the vehicles of any municipality in Maryland, except 
as to price and credit terms;

3. Cleveland, OH

    At purchaser's option, either USA Waste's Newburgh Heights 
Transfer Station, located at 3227 Harvard Road, Newburgh Heights, OH 
44105 (known as the ``Harvard Road Transfer Station''); or all of 
WMI's right, title and interest in the Strongsville Transfer 
Station, located at 16099 Foltz Industrial Parkway, Strongsville, 
OH; provided, however, that the City of Strongsville, owner of the 
transfer station, approves such sale or assignment. Defendants will 
exercise their best efforts to secure the assignments to the 
purchaser of all their rights, title and their interests in the 
Strongsville Transfer Station, and in the event the purchaser 
selects Strongsville, defendants will not reacquire any right, title 
or interest in the Strongsville transfer station. If the contract is 
not assigned defendants will enter into a disposal rights agreement 
with the purchaser (or purchasers), which will provide, in effect, 
that the purchaser(s) will enjoy all disposal rights and privileges 
now enjoyed by defendants at the Strongsville Transfer Station, and 
that defendants will operate the facility's gate, scale house, and 
disposal areas under terms and conditions no less favorable than 
those provided to defendants' own vehicles or to the vehicles of any 
municipality in Ohio, except as to price and credit terms;

4. Columbus, OH

    WMI's Reynolds Road Transfer Station, located at 805 Reynolds 
Avenue, Columbus, OH 43201;

5. Detroit, MI

    WMI's Detroit Transfer Station, located at 12002 Mack Avenue, 
Detroit, MI 48215;

6. Houston, TX

    USA Waste's Hardy Road Transfer Station, located at 18784 East 
Hardy, Houston, TX;

7. Louisville, KY

    USA Waste's Popular Level Road Transfer Station, located at 4446 
Poplar Level Road, Louisville, KY;

8. Miami, FL

    All USA Waste's right, title, and interest in the Reuters 
Transfer Station Rights, as conveyed to Chambers Waste Systems of 
Florida, a subsidiary of USA Waste, pursuant to the Final Judgment 
in United States v. Reuter Recycling of Florida, Inc., 1996-1 Trade 
Cas. (CCH) para. 71,353 (D.D.C. 1996);

9. New York, NY

    (a) WMI's SPM Transfer Station, located at 912 east 132nd 
Street, Bronx, NY 10452, and all rights and interests, legal or 
otherwise, that WMI now enjoys, has had or made use of out of the 
SPM Transfer Station, to deliver waste by truck to rail siding at 
the Oak Point Rail Yard in the Bonx, NY, and at the Harlem River 
Yards facility, located at St. Ann's and Lincoln Avenues at 132nd 
Street, Bronx, NY 10454;
    (b) All rights, title, and interest in USA Waste's pending 
application to construct and operate a waste transfer station 
located at 2 North 5th Street, Brooklyn, NY 11211 (known as the 
``Nekboh Transfer Station''); and
    (c) USA Waste's All City Transfer, located at 246-252 Plymouth 
Street, Brooklyn, NY 11202; and
    (d) WMI's Brooklyn Transfer Station, located at 485 Scott 
Avenue, Brooklyn, NY 12222, but only in the vent that USA Waste's 
Nekboh Transfer Station has not been licensed or permitted to accept 
waste within one year from the date of entry of the Final Judgment; 
and

10. Philadelphia, PA

    USA Waste's Girard Point Transfer Station, located at 3600 South 
26th Street, Philadelphia, PA 19145; and USA Waste's Quick Way Inc. 
Municipal Waste Transfer Station, located at SE Corner, Bath and 
Orthodox Streets, Philadelphia, PA 19137, subject to the conditions 
that (1) the existing City of Philadelphia waste contract is 
transferred to a WMI transfer station, which defendants must use 
their best efforts to accomplish, and (2) until such transfer is 
effected, USA Waste will be granted throughput capacity at the 
Quicky Way Transfer Station to handle this contract.

II. Commercial Waste Collection Assets

    The Final Judgments also orders USA Waste and WMI to divest 
certain commercial waste collection assets. Those assets primarily 
include, capital equipment, trucks and other vehicles, containers, 
interests, permits, used to service customers along the routes, in 
the following locations:

A. Akron, OH

    USA Waste's and American Waste Corporation's front-end loader 
truck (``FEL'') commercial routes that serve Summit County, Ohio;

B. Allentown, PA

    WMI's FEL commercial routes that serve the cities of Allentown 
and Northampton and Lehigh County, PA;

C. Cleveland, OH

    WMI's FEL commercial routes that serve the City of Cleveland, 
portions of Cuyahoga, and very limited portions of Geauga and Lake 
County, Ohio;

D. Columbus, OH

    WMI's FEL commercial routes that serve Franklin County, Ohio;

E. Denver, CO

    USA Waste's FEL commercial routes that serve the City of Denver, 
and Denver and Arapahoe County, CO;

F. Detroit, MI

    WMI's FEL commercial routes that serve the City of Detroit, and 
Wayne and limited portions of Oakland and Macomb County, MI;

[[Page 51160]]

G. Houston, TX

    WMI's FEL commercial routes that serve the City of Houston, the 
Dickinson area, and Harris County, TX;

H. Louisville, KY

    USA Waste's FEL commercial routes that serve the City of 
Louisville and Jefferson County, KY;

I. Pittsburgh, PA

    WMI's FEL commercial routes that serve Allegheny County and 
Westmoreland County, PA, and the garage facility (real estate and 
improvements) located at the Y&S Landfill;

J. Portland, OR

    WMI's FEL commercial routes that serve the City of Portland, OR;

K. Tucson, AZ

    USA Waste's FEL commercial routes that serve the City of Tucson 
and Pima County, AZ; and

L. Gainesville, FL

    WMI's FEL commercial routes that serve Alachua County, FL.

Appendix B

    Correspondence Between with Counsel for USA Waste Services, Inc. 
and Dome Merger Subsidiary and Counsel for the United States, dated 
July 14, 1998.

July 14, 1998.

By Facsimile

Anthony E. Harris, Esq.,
Antitrust Division, U.S. Department of Justice, 1401 H Street, N.W., 
Washington, DC 20530

Re: USA Waste Services, Inc. acq. of Waste Management, Inc.

    Dear Tony: The purpose of this letter is to set USA Waste 
Services, Inc's (``USA Waste'') and Waste Management, Inc.'s 
(``Waste Management'') understanding of the front-end loader routes 
that are to be divested by pursuant to Section I D of the 
Stipulation and Hold Separate Order and Section II D of the Proposed 
Final Judgment that are to be filed with the Court in this matter 
(collectively ``the Consent Decree''). USA Waste's and Waste 
Management's agreement to enter into the Consent Decree is based on 
this understanding.
    I have listed below, for each area described in the Consent 
Decree, all of the front-end loader routes operated by the company 
whose routes will be divested that generated at least ten percent 
(10%) of their revenues in the area in the most recent year of 
operation. The only exception is Waste Management of Pittsburgh 
route 226, which we agreed will not be divested. It is the 
defendants' understanding that these routes are all those that need 
to be divested pursuant to the terms of the Final Judgment.

Akron/Canton, OH

    Akron Hauling routes 70, 90-92, 94, 96 and 97.

Allentown, PA

    Waste Management of Allentown routes A60-62, A64 and A65.

Cleveland, OH

    Waste Management of Ohio--Cleveland routes F01, F04-F10, 17 and 
18.

Columbus, OH

    Waste Management of Ohio--Columbus routes 001-019.

Denver, CO

    USA Waste of Colorado routes 1301-1308, 6320-6322, 6326-6328, 
7317-7320, 1398, 1399 and 6399.

Detroit, MI

    Waste Management North Detroit routes 901-915.
    Waste Management--Metro Detroit routes 003, 005, 006, 010, 015 
and 017.
    Efficient Sanitation in Clinton Twp. route 003 serving Macomb.

Houston, TX

    Waste Management of Houston routes 702-724.
    Waste Management of Southeast Texas--Dickinson routes 2-4.

Louisville, KY

    USA Waste Services of Kentucky routes 514, 515, 526-528, 574 and 
576.

Pittsburgh, PA

    Waste Management of Pittsburgh routes 227-231.
    Waste Management of Laurel Valley routes 200 and 202-205, as 
well as the garage at the Y&S Landfill.

Portland, OR

    Waste Management of Oregon routes 201, 203, 204, 206 and 207.

Tucson, AZ

    USA Waste of Arizona, Inc. Tucson District routes 301-305 and 
391.

Gainesville, FL

    Alachua Waste Management routes G-20 and G-12.
    The United States and each of the Relevant States, as defined in 
the Final Judgment and Hold Separate Order, have agreed only that 
all front-end loader routes of the designated company that generated 
(10%) or more of the revenues in the most recent year of operation 
in an area described in the Consent Decree (with the exception of 
Pittsburgh route 226 referenced above) are to be divested pursuant 
to its terms. The United States and each of the Relevant States have 
not, at this stage, verified USA Waste's and Waste Management's 
representations as to which individual routes must be divested under 
the Consent Decree.

        Sincerely yours,
James R. Weiss,
Counsel for USA Waste Services, Inc.
Neal R. Stoll,
Counsel for Waste Management, Inc.

    Acknowledged for United States of America:
Anthony E. Harris

United States District Court, Northern District of Ohio, Eastern 
Division

    United States of America; State of Ohio; State of Arizona; State 
of California; State of Colorado; State of Florida; Commonwealth of 
Kentucky; State of Maryland; State of Michigan; State of New York; 
Commonwealth of Pennsylvania; State of Texas; State of Washington; 
and State of Wisconsin, Plaintiffs, v. USA Waste Services, Inc.; 
Dome Merger Subsidiary; and Waste Management, Inc., Defendants. 
Civil Action No. 1:98 CV 1616; Judge Aldrich.

Certificate of Service

    I, Anthony E. Harris, hereby certify that on July 16, 1998, I 
caused copies of the foregoing Competitive Impact Statement to be 
served on plaintiffs--the states of Ohio, Arizona, California, 
Colorado, Florida, Maryland, Michigan, New York, Texas, Washington and 
Wisconsin, and the commonwealths of Kentucky and Pennsylvania--and 
defendants USA Waste Services, Inc., Dome Merger Subsidiary, and Waste 
Management, Inc., by mailing a copy of the pleading first-class, 
postage paid, to a duly authorized legal representative of those 
parties as follows:
James R. Weiss, Esquire,
Preston Gates Ellis & Rouvelas Meeds LLP, 1735 New York Avenue, NW, 
Washington, DC 20006-8425.

    Counsel for Defendants USA Waste Services, Inc. and Dome Merger 
Subsidiary:
Neal R. Stoll, Esquire,
Skadden, Arps, Slate, Meagher & Flom, 919 Third Avenue, New York, NY 
10022-3897.

    Counsel for Defendant Waste Management, Inc.:
Doreen C. Johnson,
Assistant Attorney General, Chief, Antitrust Section, Ohio Bar No. 
0024725.
Mitchell L. Gentile,
Senior Attorney, Ohio Bar No. 0022274.

    Ohio Attorney General's Office, 30 East Broad Street, 16th 
Floor, Columbus, OH 43215.

[[Page 51161]]

    Counsel for Plaintiff State of Ohio:
Nancy M. Bonnell,
Assistant Attorney General, Antitrust Unit, Civil Division, 1275 West 
Washington, Phoenix, AZ 85007.

    Counsel for Plaintiff State of Arizona:
Barbara Motz,
Acting Assistant Attorney General.
Natalie S. Manzo,
Deputy Attorney General, Office of the Attorney General, 300 South 
Spring Street, Room 5212, Los Angeles, CA 90013.

    Counsel for Plaintiff State of California:
Jan Michael Zavislan,
First Asstant Attorney General.
Maria E. Berkenkotter,
Assistant Attorney General, State Services Building, 1525 Sherman 
Street, 5th Floor, Denver, CO 80203.

    Counsel for Plaintiff State of Colorado:
Lizabeth A. Leeds,
Douglas L. Kilby,
Assistant Attorneys General, Antitrust Section, PL-01, The Capitol, 
Tallahassee, FL 32399-1050.

    Counsel for Plaintiff State of Florida:
David R. Vandeventer,
Assistant Attorney General, Consumer Protection, 1024 Capital Center 
Drive, Frankfort, KY 40601-8204.

    Counsel for Plaintiff Commonwealth of Kentucky:
Ellen S. Cooper,
Assistant Attorney General, Chief, Antitrust Division.
John R. Tennis,
Assistant Attorney General, Office of the Attorney General, 200 St. 
Paul Place, Suite 17, Baltimore, MD 21202-2021.

    Counsel for Plaintiff State of Maryland:
Paul F. Novak,
Assistant Attorney General, Consumer Protection Division, Franchise/
Antitrust Section, P.O. Box 30213, Lansing, MI 48909.

    Counsel for Plaintiff State of Michigan:
Richard E. Grimm,
Kay Taylor,
Assistant Attorneys General, Antitrust Bureau, Office of the Attorney 
General, State of New York, 120 Broadway, Suite 26-01, New York, NY 
10271.

    Counsel for Plaintiff State of New York:
James A. Donahue, III,
Chief Deputy Attorney General.
Garrett F. Gallia,
Terry A. Lupia,
Deputy Attorneys General, 14th Floor, Strawberry Squire, Harrisburg, PA 
17120.

    Counsel for Plaintiff Commonwealth of Pennsylvania:
Mark Tobey,
Kim Van Winkle,
Assistant Attorneys General, P.O. Box 12548, Austin, TX 78711-2548.

    Counsel for Plaintiff State of Texas:
Marta Lowy,
Assistant Attorney General, Office of the Attorney General, 900 4th 
Avenue, Suite 2000, Seattle, WA 98164-1012.

    Counsel for Plaintiff State of Washington:
Edwin J. Hughes,
Assistant Attorney General, Wisconsin Department of Justice, P.O. Box 
7857, Madison, WI 53707-7857.

    Counsel for Plaintiff State of Wisconsin:
Anthony E. Harris, Esquire,
Illinois Bar No. 1133713. U.S. Department of Justice, Antitrust 
Division, 1401 H Street, NW, Suite 3000, Washington, DC 20530, (202) 
307-0924.
[FR Doc. 98-24974 Filed 9-23-98; 8:45 am]
BILLING CODE 4410-11-M