What is the main purpose of the Standstill Agreement filed by Republic Services?

The main purpose of the Standstill Agreement is to outline the terms and conditions under which Cascade Investment, L.L.C. and the Bill & Melinda Gates Foundation Trust can acquire additional shares of Republic Services stock, and to establish limitations on their actions and influence as significant shareholders. It also ensures that these actions are pre-approved by the Board for the purposes of Delaware's Section 203 anti-takeover statute.

Who are Cascade Investment and the Bill & Melinda Gates Foundation Trust in relation to RSG?

Cascade Investment, L.L.C. is a significant shareholder in Republic Services, holding approximately 14.4% of the common stock, and is associated with William H. Gates III. The Bill & Melinda Gates Foundation Trust holds approximately 0.4% of the common stock, also associated with William H. Gates III and Melinda French Gates. Together, they represent a substantial ownership stake in the company.

What are the key restrictions placed on Cascade Investment and the Bill & Melinda Gates Foundation Trust by the Standstill Agreement?

The agreement restricts them from acquiring shares if their collective ownership exceeds 25% of the outstanding stock (with certain exceptions), from forming other voting groups, from depositing stock into voting trusts, from soliciting proxies, or from taking any action to seek control of the company without prior board approval.

When does the Standstill Agreement expire or terminate?

The Standstill Agreement remains in effect until the earliest of several events: mutual written agreement, a third-party commences a tender offer or definitive agreement for 50% or more of RSG, Cascade and the Trust's ownership drops below 15% after having exceeded it, November 3, 2013, or if their combined ownership is less than 15% by February 9, 2011.

RSG 8-K: Material Agreements

Summary

Republic Services, Inc. (RSG) filed an 8-K on November 5, 2010, to disclose a material definitive agreement related to its relationship with significant shareholders, Cascade Investment, L.L.C. and the Bill & Melinda Gates Foundation Trust. The company's Board of Directors has approved certain potential future share acquisitions by these entities, effectively exempting them from Delaware's anti-takeover statute (Section 203) for transactions occurring on or before February 9, 2011. This move is formalized through a Standstill Agreement, which also places restrictions on the actions of Cascade and the Trust regarding their ownership and influence over RSG stock. This agreement is significant for investors as it clarifies the intentions and limitations of two major shareholders who collectively hold approximately 14.8% of RSG's common stock. The Standstill Agreement imposes a cap on their combined ownership at 25% and restricts them from forming voting groups (other than among themselves), soliciting proxies, or taking actions to control the company, unless such actions are approved by the board. The agreement provides clarity and stability by defining the parameters of engagement for these significant stakeholders.

Key Highlights

1RSG's Board of Directors granted approval under Delaware's Section 203 for potential future share purchases by Cascade Investment and the Bill & Melinda Gates Foundation Trust.
2A Standstill Agreement was executed between RSG, Cascade Investment, and the Bill & Melinda Gates Foundation Trust on November 3, 2010.
3The agreement allows Cascade and the Trust to acquire additional shares until February 9, 2011, under specific conditions.
4The Standstill Agreement places limitations on the combined beneficial ownership of Cascade and the Trust, capping it at 25% of outstanding common stock.
5Key restrictions include preventing the formation of external voting groups, soliciting proxies, or taking actions to control the company without board approval.
6The Standstill Agreement terminates under specific conditions, including mutual agreement, a third-party acquisition offer of 50% or more, or if Cascade and the Trust's ownership falls below 15% after exceeding it.

REPUBLIC SERVICES, INC. 8-K Report, Material Agreement (Nov 5, 2010)

Summary

Key Highlights

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