EXHIBIT 4.14
THIS EMPLOYMENT AGREEMENT made as of this 1st day of January, 2002.
B E T W E E N:
CAPITAL ENVIRONMENTAL RESOURCE INC., an Ontario corporation having its
head office at 0000 Xxxxxxx Xxxxx, Xxxxxxxxxx, XX X0X 0X0
("CAPITAL")
- AND -
XXXX X. XXXXXXXX, an individual residing at 0000 Xxxxxxxxxx Xxxx,
Xxxxxxxx, Xx 00000
(the "EMPLOYEE" or "XX. XXXXXXXX")
WHEREAS, the Corporation desires to retain Xx. XxXxxxxx as an employee;
AND WHEREAS, Xx. XxXxxxxx is desirous of being so retained;
NOW THEREFORE IN CONSIDERATION of the Employee's employment by Capital, the
mutual provisions contained herein, the compensation to be paid the Employee
either in the form of salary, other compensation or increases therein and for
good and valuable consideration more particularly set out herein, the parties
agree with each other as follows:
1. EMPLOYMENT
A. Capital hereby employs the Employee and the Employee hereby accepts
employment upon the terms and conditions of this Agreement. The
Employee shall have the titles of Executive Vice President and Chief
Operating Officer for Eastern Canada and shall report to the Chief
Executive Officer of Capital or his designee and shall perform such
duties, assume such responsibilities and devote such time, attention
and energy to the business of Capital and corporations affiliated with
Capital (the "Affiliated Corporations") as Capital shall reasonably
require.
2. COMPENSATION
For all services rendered by the Employee under this Agreement, Capital
agrees to compensate the Employee during the term hereof, as follows:
A. BASE SALARY. Employee's base salary shall be $60,000 per annum payable
on a periodic basis consistent with Capital's payroll procedures for
executive employees. The Employee's base salary shall be reviewed at
least annually and shall be increased as agreed by Capital and the
Employee from time to time.
2
B. OTHER COMPENSATION. The Employee shall be entitled to receive the
following additional compensation:
i. BONUS. For each of 2002 and 2003, Employee may receive an
annual performance bonus in an amount to be determined at
the discretion of the Chief Executive Officer.
ii. BENEFITS. If eligible, Employee and his dependants shall be
covered under Capital's executive benefit plan inclusive of
the matching pension contribution to a maximum of five
percent (5%) of base salary and such other benefits as may
be authorized by the Board of Directors or Compensation
Committee from time to time.
iii. VACATION. Employee shall be granted four (4) weeks vacation
in each fiscal year, to be taken at such times as mutually
agreed between the Employee and Capital. Vacation may only
be taken within the year of entitlement and may not be
accumulated form year to year unless otherwise mutually
agreed.
iv. CAR.
(1) Capital shall provide the Employee with a leased
vehicle (or equivalent car allowance) commensurate with
his position;
(2) Capital shall be responsible for all costs incurred in
the operation of such vehicle including fuel,
maintenance, and insurance. Capital will compensate the
Employee for any deemed taxable benefits for his
personal use of such vehicle including taxable benefits
relating to operating costs; and
(3) Capital shall provide at its cost a transponder for the
Employee to use while commuting from and to his home to
and from Capital's offices.
v. STOCK OPTIONS. Effective upon the date of this Agreement and
with a grant date of November 19, 2001, the Employee shall
be granted 250,000 options to purchase stock in the capital
of Capital, which shall vest upon the second anniversary of
the grant date (the "Vesting Date"). The exercise price for
each optioned share shall be the price per share as listed
on Nasdaq at the close of business on November 18, 2001.
vi. MOBILE TELEPHONE. Capital shall provide the Employee with a
mobile telephone and pay all reasonable charges incurred by
the Employee in connection with the use of such telephone or
reimburse Employee for same.
C. EXPENSES. Employee shall be reimbursed for all expenses reasonably and
actually incurred in the performance of his duties, subject to
submission of appropriate
3
documentation in accordance with Capital's expense reimbursement
policy in effect from time to time.
3. TERM, TERMINATION
A. The Employee shall be employed for a term of two (2) years ending
December 31, 2003 (the "TERM").
B. Employee's employment hereunder shall terminate upon Employee's death.
C. The Company may terminate Employee's employment hereunder upon
Employee's becoming "Totally Disabled". For purposes of this
Agreement, Employee shall be "Totally Disabled" if Employee is
physically or mentally incapacitated so as to render Employee
incapable of performing the usual and customary duties under this
Agreement. Employee's receipt of disability benefits under the
Company's long-term disability plan or receipt of other disability
benefits shall be deemed conclusive evidence of being Totally Disabled
for the purposes of this Agreement; provided, however, that in the
absence of Employee's receipt of such long-term disability benefits or
other disability benefits, the Company may, in its reasonable
discretion (but based upon appropriate medical evidence), determine
that Employee is Totally Disabled.
D. The Employee may be terminated at any time for Cause without notice or
compensation in lieu thereof. For purposes of this Agreement, the term
"Cause" shall mean any of the following: (A) conviction of a crime
(including conviction on a guilty plea) involving an indictable
offence or, in the good faith judgment of the Company, fraud,
dishonesty, or moral turpitude; (B) deliberate and continual refusal
to perform employment duties reasonably requested by the Company or an
affiliate after five (5) days' written notice by certified mail of
such failure to perform, specifying that the failure constitutes cause
(other than as a result of vacation, sickness, illness or injury); (C)
fraud or embezzlement or material conflict of interest, determined in
accordance with the Company's normal, internal investigative
procedures consistently applied in comparable circumstances; (D) gross
misconduct or gross negligence in connection with the business of the
Company or an affiliate which has substantial effect on the Company or
the affiliate; or (E) breach of any of the covenants set forth in
Section 4 hereof.
E. Any determination of Cause under this Agreement shall be made by the
Company after giving Employee a reasonable opportunity to be heard.
F. Employee may terminate employment hereunder at any time after
providing thirty (30) days' written notice to the Company
4
G. On termination, without Cause, Employee shall receive:
i. by way of salary continuance of the Employee's base salary
for the greater of the remaining Term at the time of
termination of this Agreement or six (6) months (the
"SEVERANCE PERIOD") Such severance shall be paid over the
Severance Period in accordance with Capital's payroll
procedures for executive employees;
ii. entitlement to the options granted under Section 2.B.v
hereof vesting according to the preceding schedule
regardless of whether Employee's employment shall terminate
prior to the vesting of such options and shall remain
exercisable for the full Term of the Option, as such terms
are defined in the Employee Option Agreement between Capital
and the Employee of even date; and
iii. his Annual Bonus from previous year (pro-rated).
H. For greater certainty should the agreement not be renewed for a
further term, Employee shall receive (6) six months severance paid in
accordance with the above.
I. In the event that Employee's employment is terminated by reason of
Employee's death, the Company shall pay the following amounts to
Employee's beneficiary or estate:
i. Any accrued but unpaid Base Salary for services rendered to
the date of death, any accrued but unpaid expenses required
to be reimbursed under this Agreement, any vacation accrued
to the date of death, and a prorated annual incentive bonus.
ii. Any benefits to which Employee may be entitled pursuant to
the plans, policies and arrangements referred to in Section
2.B.ii hereof as determined and paid in accordance with the
terms of such plans, policies and arrangements.
J. In the event that Employee's employment is terminated by reason of
Employee being Totally Disabled as determined in accordance with
Section 3.C, the Company shall pay the following amounts to Employee:
i. Any accrued but unpaid Base Salary for services rendered to
the date of termination, any accrued but unpaid expenses
required to be reimbursed under this Agreement, any vacation
accrued to the date of termination, and a prorated annual
incentive bonus.
5
ii. Any benefits to which Employee may be entitled pursuant to
the plans, policies and arrangements referred to in Section
2.B.ii hereof shall be determined and paid in accordance
with the terms of such plans, policies and arrangements.
iii. The Base Salary (at the rate in effect as of the date of
Employee's termination) which would have been payable to
Employee if Employee had continued in active employment
until the later of: (A) the period ending on the last day of
the Term; or (B) the end of the six (6) month period
beginning on the date of Employee's termination. Payment
shall be made at the same time and in the same manner as
such compensation would have been paid if Employee had
remained in active employment until the end of such period.
The Employee shall also be eligible for a bonus or incentive
compensation payment to the extent bonuses are paid to
similarly situated employees, pro-rated for the year in
which the Employee is terminated, and paid when similarly
situated employees are paid.
iv. The Company completely at its expense will continue for
Employee and Employee's spouse and dependents, group health
plans, programs or arrangements, in which Employee was
entitled to participate at any time during the twelve-month
period prior to the date of termination, until the earlier
of: (A) last day of period during which Employee receives
payment in accordance with clause iii above; (B) Employee's
death (provided that benefits payable to Employee's
beneficiaries shall not terminate upon Employee's death); or
(C) with respect to any particular plan, program or
arrangement, the date Employee becomes covered by a
comparable benefit provided by a subsequent employer.
K. Upon the effective date of termination or resignation, the Employee
shall promptly deliver and return to Capital all the property,
including, but not limited to, credit cards, customer lists, financial
data, letters, notes, notebooks, reports, or copies of any of the
above, any Confidential Information, as defined in Section 4.A.i.
4. NON-COMPETITION AND NON-SOLICITATION COVENANTS
A. DEFINITIONS.
i. "Confidential Information" includes information whether or
not developed by the Employee and includes, but is not
limited to:
(1) names and identities of former, existing, and
prospective customers/clients of Capital not well known
to the trade; all contacts at all such
customers/clients whether or not such customers/clients
are well known to the trade; Capital's customer lists;
contents of Capital's proposals for sales, maintenance,
service, license, and other
6
contracts; contents of all such contracts with all
former, existing and prospective customers/clients of
Capital; Capital's costing and estimation procedures
and formulae regarding proposals and other uses;
information regarding Capital's sales, profit and loss,
profit margin, production costs, overhead, and other
bookkeeping and accounting information; all information
regarding Capital's business development and marketing;
names and identities of Capital's vendors and suppliers
not well know to the trade; all contacts at all such
vendors and suppliers whether or not such vendors and
suppliers are well know to the trade; costs and
contents of proposals and actual contracts between
Capital and all such vendors and suppliers;
(2) confidential information revealed to Capital by third
parties and which Capital is obligated to keep
confidential; and,
(3) any other information that may be considered by Capital
as Capital's confidential information under applicable
laws.
ii. "Business" means the business that Capital is involved in
being the operation of collection, transportation, storage,
processing, recycling, reuse, handling and disposition of
solid and liquid, non-hazardous waste materials.
iii. "Severance Period" has the meaning ascribed thereto in
Section 3.G of the Employment Agreement.
B. CONFIDENTIALITY AND NON-DISCLOSURE.
i. Employee acknowledges that during Employee's employment,
Employee has had and/or will have access to and has become
and/or will or may become aware of Confidential Information.
Employee agrees to hold in confidence all Confidential
Information disclosed to Employee or developed by Employee
in connection with Employee's employment, except:
(1) information which, at the time of disclosure, is in the
public domain; or
(2) information which Employee can show was in Employee's
possession prior to entering into this Agreement and
which was not acquired, directly or indirectly, from
Capital.
ii. Employee will not, without the written permission of
Capital, use or disclose the Confidential Information which
Employee is obligated under this Agreement to maintain in
confidence for any reason other than to enable Employee to
properly and completely perform Employee's employment.
7
iii. For purposes of this provision, Confidential Information
shall not include information already in the public domain
other than as a result of a breach of this Agreement by the
Employee. If disclosure is required pursuant to an order of
a court or other tribunal having jurisdiction and the
Employee, having consulted with and received an opinion of
his counsel, is compelled to release such information, the
Employee shall not be in breach of this provision in
complying with such order. In such circumstances, the
Employee agrees to limit such disclosure to that information
specifically required by the court or other tribunal having
jurisdiction and agrees prior to such disclosure to provide
the Corporation with notice thereof immediately following
receipt by the Employee of such order.
iv. Employee will not reproduce or make copies of the
Confidential Information or Employee's output, except as
required in the performance of Employee's employment. Upon
termination of Employee's employment for any reason
whatsoever, Employee will promptly deliver to Capital all
research, correspondence, data, formulae, records, drawings,
blueprints, manuals, letters, notes, notebooks, reports,
flow-charts, programs, proposals, documents (collectively,
"Documents") concerning Capital's customers/clients,
Documents concerning products, and all other Documents,
writings, and materials used by Employee or in the
possession or control of Employee which were used by
Employee during Employee's employment with Capital. Employee
understands that all such Documents, whether developed by
Employee or others, are and will remain the property of
Capital.
v. Except as may be required by Employee's employment, Employee
will not, during or at any time subsequent to Employee's
employment, unless Capital has given prior written consent,
disclose or use the Confidential Information or engage in or
refrain from any action, where such action or inaction may
result (1) in the unauthorized disclosure of any or all such
Confidential Information to any person or entity, or (2) in
the infringement of any or all such rights in the
Confidential Information.
vi. Employee will immediately notify Capital of any information
which comes to Employee's attention which does or might
indicate that there has been any loss of confidentiality of
such Confidential Information or breach of such rights in
the Confidential Information.
vii. Employee agrees that during Employee's employment with
Capital, Employee will not breach any obligation of
confidentiality that Employee may have to others.
viii. Employee represents that Employee's performance of all the
terms of this Agreement does not and will not breach any
agreement to keep in confidence
8
proprietary information acquired by Employee in confidence
or in trust prior to employment by Capital. Employee
warrants that Employee has entered into no agreement, either
written or oral, which conflicts with this Agreement, and
moreover, that Employee will not enter into any such
Agreement.
C. FORMER EMPLOYER CONFIDENTIAL INFORMATION.
Employee's understands that as part of the consideration for Capital's
offer of employment and Employee's continued employment hereunder,
that Employee has represented that Employee has not brought and will
not bring and Employee has not brought and will not bring into Capital
or use in the performance of Employee's responsibilities at Capital
any equipment, supplies, trade secrets, confidential information or
otherwise of any former employer which are not generally available to
the public, unless Employee has first obtained written authorization
for its possession and use.
D. NON-COMPETITION AND NON-SOLICITATION.
i. Employee will not, during Employee's employment and after
the termination of Employee's employment for any reason
whatsoever, directly or indirectly:
(1) solicit the trade or patronage of any of the
customers/clients or prospective customer/clients of
Capital, with respect to any of the services, products,
Confidential Information, or other matters of Capital;
and,
(2) Employee will not, during Employee's employment and
within a 75 km radius of any location where Capital or
any of its affiliates carries on the Business, where
the Employee has assumed responsibilities during the
course of the last year of his employment: (i) in the
event that the Employee's employment is terminated
(other than for just cause by Capital), for a period
equivalent to the Severance Period; and (ii) in the
event that the Employee resigns his employment or is
terminated for just cause, for a period of one (1) year
from the date of such resignation/termination (the
"TERMINATION PERIOD"), directly or indirectly:
ii. solicit the trade or patronage of any of the
customers/clients or prospective customer/clients of
Capital, with respect to any of the services, products,
Confidential Information, or other matters of Capital; and,
iii. found, work for, consult for, or assist in any way, whether
in a paid or unpaid capacity, any individual, partnership,
company, employer, business, research facility, or other
entity which competes with the Business of Capital.
9
iv. The restrictions set out in Section 4.D will apply during
the Employee's employment and for either the Severance
Period or the Termination Period, whichever is applicable.
v. Employee agrees that during Employee's employment and for
either the Severance Period or the Termination Period,
whichever is applicable, Employee will not solicit or in any
manner encourage any employee of Capital to leave Capital's
employ.
E. INJUNCTIVE RELIEF AND PROOF.
i. Employee acknowledges and agrees that Capital has a material
interest in preserving the relationship it has developed
with its clients/customers against impairment by competitive
activities of a former employee and in protecting the
Confidential Information from use and dissemination.
Accordingly, Employee agrees that the restrictions,
agreements, representations, and warranties, contained in
this Agreement are of the essence to this Agreement and
constitute a material inducement to Capital to employ
Employee, and that Capital would not employ Employee absent
such an inducement. Furthermore, the existence of any claim
or cause of action by Employee against Capital whether
predicated on this Agreement or otherwise, will not
constitute a defence to the enforcement by Capital of the
restrictions, agreements, representations, and warranties
contained in this Agreement, provided, however, that if any
provision will be held to be illegal, invalid or
unenforceable in any jurisdiction, the decision will not
affect any other agreement or provision of this Agreement or
the application or any other agreement or provision.
ii. Employee acknowledges and agrees that a breach of any
agreement, restriction, representation or warranty contained
in this Agreement would cause Capital irreparable harm not
compensable by damages alone. As such Employee acknowledges
and agrees that if Employee breaches any of the agreements
contained in this Agreement, Capital has the right to
temporary and permanent injunctive relief in addition to any
other appropriate relief granted by a court of competent
jurisdiction to restrain any breach of such agreements by
Employee, without the burden of proving actual damage to
Capital by reason of any such breach and without having to
post security in respect of an application for such relief.
Employee acknowledges and agrees that restricting the
remedies of Capital to an action for damages would not be
sufficient to protect Capital in the circumstances of any
such breach. In the event of any such breach, Employee
agrees that Capital will be entitled to recover its legal
costs of any application to a court of competent
jurisdiction to remedy any such breach.
5. SEVERABLE PROVISIONS
10
In case of any one (1) or more of the provisions or parts thereof contained
in this Agreement shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect (i) such invalidity, illegality or
unenforceability shall not affect any other provisions or parts thereof of
this Agreement, and (ii) this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained
herein. Failure to insist upon strict compliance with any provision of this
Agreement shall not be deemed a waiver of such provisions or any other
provision of this Agreement.
6. ENTIRE AGREEMENT
The Employee acknowledges receipt of a copy of this Agreement (together
with any attachments hereto), which has been executed in duplicate and
agrees that it is the entire Agreement with Capital and supersedes any and
all previous oral or written agreements or representations respecting or
relating in any way to the Employee's employment including but not limited
to its terms and conditions. It is further agreed that this Agreement can
only be amended by an agreement in writing signed by both the Employee and
an officer of Capital provided that this shall not preclude Capital or
Affiliated Corporations from granting an increase in salary or an
enhancement of benefits. For greater certainty, any oral or written
representations, understanding or agreements with Capital or Affiliated
Corporations, any of their officers or representatives in any way relating
to the Employee's employment including but not limited to its terms and
conditions are hereby declared to be void, of no effect and are superseded
by the provisions of this Agreement. The Employee further acknowledges and
agrees that neither Capital nor Affiliated Corporations is in any way
responsible or liable for any such oral or written representations,
understandings or agreements.
7. GOVERNING LAW
This Agreement shall be construed in accordance with and governed for all
purposes by the laws of the Province of Ontario subject to the mandatory
application of the statutes of any province other than Ontario where the
Employee is employed in such other province and the laws of Canada
applicable therein.
8. ASSIGNMENT
The Employee acknowledges that Capital or any of its Affiliated
Corporations may assign this Agreement amongst themselves, to any
corporation with which they are merged or amalgamated, or to any third
party acquiring all or part of any of the businesses of Capital or any of
its Affiliated Corporations.
9. OPPORTUNITY TO SEEK INDEPENDENT ADVICE
The Employee recognizes that this Agreement is an important document that
affects his legal rights. For this reason, Employee may wish to seek
independent legal advice before accepting the terms stated herein. The
Employee acknowledges that he has had an opportunity to seek such
independent legal advice. The Employee acknowledges that he has
11
read and understands the provisions contained herein and acknowledges
receipt of a copy of this Agreement.
SIGNATORY PAGE FOLLOWS
12
IN WITNESS WHEREOF the parties have executed this Agreement as of the date set
forth above.
CAPITAL ENVIRONMENTAL RESOURCE INC.
By: /s/ Xxxxxx X. Xxxxxx, III
--------------------------------
Xxxxxx X. Xxxxxx, III
Secretary and General Counsel
/s/ Xxxx X. XxXxxxxx
-------------------------------------
XXXX X. XXXXXXXX
-------------------------------------
WITNESS
