EXHIBIT 10.19
KEY EXECUTIVE EMPLOYMENT AND SEVERANCE AGREEMENT
THIS AGREEMENT, made and entered into as of the 18th day of August, 1998,
by and between SUPERIOR SERVICES, INC., a Wisconsin corporation ("Company"), and
Xxxxxx X. Xxxx ("Executive").
WITNESSETH:
WHEREAS, the Executive is employed by the Company as a key executive
officer, and the Executive's services in such capacities are critical to the
continued successful conduct of the business of the Company;
WHEREAS, the Company recognizes that circumstances in which a change in
control of the Company occurs, through acquisition or otherwise, are highly
disruptive and will cause uncertainty about the Executive's future employment
with the Company without regard to the Executive's competence or past
contributions and that such uncertainty may materially adversely affect the
Company;
WHEREAS, the Company and the Executive are desirous that any proposal for
a change in control or acquisition of the Company will be considered by the
Executive objectively, with reference only to the best interests of the Company
and its shareholders and without undue regard for the Executive's personal
interests; and
WHEREAS, the Executive will be in a better position to consider the
Company's and its shareholders' best interests if the Executive is afforded
reasonable security, as provided in this Agreement, against altered conditions
of employment which could result from any such change in control or acquisition.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, the parties hereto mutually
covenant and agree as follows:
1.Definitions.
(a)Act. For purposes of this Agreement, the term "Act" means the Securities
Exchange Act of 1934, as amended.
(b)Affiliate and Associate. For purposes of this Agreement, the terms
"Affiliate" and "Associate" shall have the respective meanings ascribed to such
terms in Rule 12b-2 of the General Rules and Regulations of the Act.
(c)Beneficial Owner. For purposes of this Agreement, a
Person shall be deemed to be the "Beneficial Owner" of any securities:
(i)which such Person or any of such Person's Affiliates or Associates has the
right to acquire (whether such right is exercisable immediately or only after
the passage of time) pursuant to any agreement, arrangement or understanding, or
upon the exercise of conversion rights, exchange rights, rights, warrants or
options, or otherwise; provided, however, that a Person
shall not be deemed the Beneficial Owner of, or to beneficially own, securities
tendered pursuant to a tender or exchange offer made by or on behalf of such
Person or any of such Person's Affiliates or Associates until such tendered
securities are accepted for purchase. (ii)which such Person or any of such
Person's Affiliates or Associates, directly or indirectly, has the right to vote
or dispose of or has "beneficial ownership" of (as determined pursuant to Rule
13d-3 of the General Rules and Regulations under the Act), including pursuant to
any agreement, arrangement or understanding; provided, however, that a Person
shall not be deemed the Beneficial Owner of, or to beneficially own, any
security under this subparagraph (ii) as a result of an agreement, arrangement
or understanding to vote such security if the agreement, arrangement or
understanding: (A) arises solely from a revocable proxy or consent given to such
Person in response to a public proxy or consent solicitation made pursuant to,
and in accordance with, the applicable rules and regulations under the Act and
(B) is not also then reportable on a Schedule 13D under the Act (or any
comparable or successor report); or (iii)which are beneficially owned, directly
or indirectly, by any other Person with which such Person or any of such
Person's Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting (except pursuant to
a revocable proxy as described in Subsection 1(c)(ii) above) or disposing of any
voting securities of the Company.
(d)Cause. "Cause" for termination by the Company of the Executive's employment
after a Change in Control of the Company, for purposes of this Agreement, shall
mean the following and only the following: the Executive's final and
nonappealable conviction of, and sentencing for, a felony offense for a crime
involving an act by the Executive of conduct on behalf of the Company that
results in the Executive being physically imprisoned in a federal or state
penitentiary; provided, that _Cause_ for termination shall only be determined by
a vote of two-thirds of the Board of Directors of the Company after (i)
reasonable written notice to the Executive, setting forth the basis for _Cause,_
specifying the particulars thereof in detail; and (ii) an opportunity for the
Executive, together with his counsel, to be heard before the Board. (e)Change
in Control of the Company. For purposes of this Agreement, prior to the IPO
Effective Date, a "Change in Control of the Company" shall be deemed to have
occurred if (i) the Beneficial Owners of the securities of the Company as of the
date of this Agreement beneficially own securities of the Company representing
less than 50.1% of the combined voting power of the Company's then outstanding
securities or (ii) either of the events described in Subsections 1(e)(II) or
(III) below occur. For purposes of this Agreement, after the IPO Effective Date,
a "Change in Control of the Company" shall be deemed to have occurred if: (I)any
Person (other than any employee benefit plan of the Company, any subsidiary of
the Company or any Person organized, appointed or established pursuant to the
terms of any such benefit plan or any Person who currently owns, or is the
Beneficial Owner of, 25% or more of the combined voting power of the Company's
currently outstanding securities) is or becomes the Beneficial Owner of
securities of the Company representing at least 25% of the combined voting power
of the Company's then outstanding securities;
(II) there shall be consummated (x) any consolidation, merger, share exchange or
other business combination of the Company in which the Company is not the
continuing or surviving corporation or pursuant to which shares of the Company's
capital stock would be converted into cash, securities or other property, other
than a merger of the Company in which the holders of the Company's capital stock
immediately prior to the merger have the same proportionate ownership of capital
stock of the surviving corporation immediately after the
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merger, or (y) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all, or substantially all, of the
consolidated assets of the Company; or (III)the shareholders' of the Company
approve any plan or proposal for the liquidation or dissolution of the Company.
Notwithstanding anything else in this Subsection 1(e), the effective
distribution of the Company's securities in its IPO shall not constitute a
Change in Control of the Company; provided, however, that an IPO which is not
completed but which otherwise leads to any of the events described in the first
sentence of this Subsection 1(e) shall constitute a Change in Control of the
Company.
(f)Code. For purposes of this Agreement, the term "Code" means the Internal
Revenue Code of 1986, including any amendments thereto or successor tax codes
thereof.
(g)Covered Termination. For purposes of this Agreement, the term "Covered
Termination" means any termination of the Executive's employment where the
Termination Date is any date on or prior to the end of the Employment Period.
(h)Discretionary Termination. For purposes of this Agreement, "Discretionary
Termination" means the determination by the Executive, or his estate or personal
representative in the event of the Executive's death or disability, at any time
during the twelve (12) month period commencing on the occurrence of a Change in
Control of the Company, as evidenced by the delivery to the Company, by the
Executive or by his estate or personal representative in the case of the
Executive's death or disability, of a Notice of Termination during such period,
to terminate this Agreement and his employment hereunder for any reason
whatsoever in his sole discretion, with or without good faith, even if the
Company has previously terminated the Executive for death, disability, Cause or
otherwise during such twelve (12) month period following a Change in Control of
the Company.
(i)Employment Period. For purposes of this Agreement, the term "Employment
Period" means a Period commencing on the date of a Change in Control of the
Company and ending at 11:59 p.m. Milwaukee time on the third anniversary of such
date.
(j)Good Reason. For purposes of this Agreement, the Executive shall have a "Good
Reason" for termination of employment after a Change in Control of the Company
in the event of:
(i)any breach of this Agreement by the Company, including specifically any
breach by the Company of its agreements contained in Sections 4, 5 or 6 hereof;
(ii)the removal of the Executive from, or any failure to reelect the Executive
to, any of the positions held with the Company and its subsidiaries on the date
of the Change in Control of the Company or any other positions with the Company
and its subsidiaries to which the Executive shall thereafter be elected or
assigned, except in the event that such removal or failure to reelect relates to
the termination by the Company of the Executive's employment for Cause or by
reason of disability pursuant to Section 12 hereof;
(iii)a good faith determination by the Executive that there has been a
significant adverse change, without the Executive's written consent (which may
be withheld at Executive's discretion), in the Executive's working conditions or
status with the Company or its subsidiaries from such working conditions or
status in effect immediately prior to the Change in Control of the Company,
including but not limited to (A) a significant change in the nature or scope of
the Executive's authority, powers, functions, duties or responsibilities, or (B)
a reduction in the level of support services, staff, secretarial and other
assistance, office space and accoutrements; or
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(iv)failure by the Company to timely obtain the Agreement referred to in Section
17(a) hereof as provided therein.
(k)IPO. For purposes of this Agreement, the term "IPO" means the Company's
initial public offering of equity securities registered under the Securities
Act.
(l)IPO Effective Date. For purposes of this Agreement, the term "IPO Effective
Date" means the date on which the Securities and Exchange Commission declares
the IPO effective pursuant to the Securities Act.
(m)Person. For purposes of this Agreement, the term "Person" shall mean any
individual, firm, partnership, corporation or other entity, including any
successor (by merger or otherwise) of such entity, or a group of any of the
foregoing acting in concert.
(n)Securities Act. For purposes of this Agreement, the term "Securities Act"
means the Securities Act of 1933, as amended.
(o)Termination Date. For purposes of this Agreement, except as otherwise
provided in Section 10(b) and Section 17(a) hereof or as set forth below, the
term "Termination Date" means (i) if the Executive's employment is terminated by
the Executive's death, the date of death; (ii) if the Executive's employment is
terminated by reason of voluntary early retirement, as agreed in writing by the
Company and the Executive, the date of such early retirement as set forth in
such written agreement; (iii) if the Executive's employment is terminated by
reason of disability pursuant to Section 12 hereof, the earlier of thirty (30)
days after the Notice of Termination is given or one day prior to the end of the
Employment Period; (iv) if the Executive's employment is terminated by the
Executive voluntarily (other than for Good Reason), the date the Notice of
Termination is given; (v) if the Executive's employment is terminated by the
Executive voluntarily pursuant to a Discretionary Termination, the Termination
Date for the purposes of the payment of a Termination Payment and a Gross-Up
Payment, if any, under Section 9(b) hereof shall be the date the Notice of
Termination is given to the Company; and (vi) if the Executive's employment is
terminated by the Company (other than by reason of disability pursuant to
Section 12 hereof) or by the Executive for Good Reason, the earlier of thirty
(30) days after the Notice of Termination is given or one day prior to the end
of the Employment Period. Notwithstanding the foregoing,
(A)If termination is by the Company for Cause pursuant to Section 1(d)(iii) of
this Agreement and if the Executive has cured the conduct constituting such
Cause as described by the Company in its Notice of Termination within such
thirty (30) day or shorter period, then the Executive's employment hereunder
shall continue as if the Company had not delivered its Notice of Termination.
(B)If the Company shall give a Notice of Termination for Cause or by reason of
disability and the Executive in good faith notifies the Company that a dispute
exists concerning the termination within the fifteen (15) day period following
receipt thereof, then the Executive may elect to continue his employment during
such dispute and the Termination Date shall be determined under this paragraph.
If the Executive so elects and it is thereafter determined that Cause or
disability (as the case may be) did exist, the Termination Date shall be the
earlier of (1) the date on which the dispute is finally determined, either (x)
by mutual written agreement of the parties or (y) in accordance with Section 22
hereof, (2) the date of the Executive's death, or (3) one day prior to the end
of the Employment Period. If the Executive so elects and it is thereafter
determined that Cause or disability (as the case may be) did not exist, then the
employment of the Executive hereunder shall continue after such determination as
if the Company had not delivered its Notice of Termination and there shall be no
Termination Date
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arising out of such Notice. In either case, this Agreement continues, until the
Termination Date, if any, as if the Company had not delivered the Notice of
Termination except that, if it is finally determined that the Company properly
terminated the Executive for the reason asserted in the Notice of Termination,
the Executive shall in no case be entitled to a Termination Payment (as
hereinafter defined) arising out of events occurring after the Company delivered
its Notice of Termination.
(C)If the Executive shall in good faith give a Notice of Termination for Good
Reason and the Company in good faith notifies the Executive that a dispute
exists concerning the termination within the fifteen (15) day period following
receipt thereof, then the Executive may elect to continue his employment during
such dispute and the Termination Date shall be determined under this paragraph.
If the Executive so elects and it is thereafter determined that Good Reason did
exist, the Termination Date shall be the earlier of (1) the date on which the
dispute is finally determined, either (x) by mutual written agreement of the
parties or (y) in accordance with Section 22 hereof, (2) the date of the
Executive's death or (3) one day prior to the end of the Employment Period. If
the Executive so elects and it is thereafter determined that Good Reason did not
exist, then the employment of the Executive hereunder shall continue after such
determination as if the Executive had not delivered the Notice of Termination
asserting Good Reason and there shall be no Termination Date arising out of such
Notice. In either case, this Agreement continues, until the Termination Date, if
any, as if the Executive had not delivered the Notice of Termination except
that, if it is finally determined that Good Reason did exist, the Executive
shall in no case be denied the benefits described in Sections 8(b) and 9 hereof
(including a Termination Payment) based on events occurring after the Executive
delivered his Notice of Termination.
(D)If an opinion is required to be delivered pursuant to Section 9(b) hereof and
such opinion shall not have been delivered, the Termination Date shall be the
earlier of the date on which such opinion is delivered or one day prior to the
end of the Employment Period.
(E)Except as provided in Paragraphs (B) and (C) above and other than a
Discretionary Termination (which cannot be subject to dispute by the Company),
if the party receiving the Notice of Termination in good faith notifies the
other party that a dispute exists concerning the termination within the fifteen
(15) day period following receipt thereof and it is finally determined that the
reason asserted in such Notice of Termination did not exist, then (1) if such
Notice was delivered by the Executive, the Executive will be deemed to have
voluntarily terminated his employment and (2) if delivered by the Company, the
Company will be deemed to have terminated the Executive other than by reason of
death, disability or Cause.
2.Termination or Cancellation Prior to Change in Control. The Company shall
retain the right to terminate the employment of the Executive at any time prior
to a Change in Control of the Company, subject to the terms and conditions of
any other then existing employment arrangement or agreement between the
Executive and the Company; provided, however, that if the Executive's employment
is terminated by the Company, other than by reason of (i) death, (ii) disability
in accordance with Section 12 hereof, or (iii) Cause, at any time after
negotiations are commenced between the Company and another Person which
ultimately lead to a Change in Control of the Company, then the Executive shall
be entitled to receive at the earlier to occur of the closing or the effective
date of such Change in Control of the Company all Accrued Benefits and a
Termination Payment, including benefits under Section 8(b) hereof, as if such
termination of employment was a Covered Termination under Section 8 hereof.
Other than as set forth above or as provided in Section 17 hereof, in the event
the Executive's
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employment is terminated prior to a Change in Control of the Company, this
Agreement shall be terminated and canceled and of no further force and effect
and any and all rights and obligations of the parties hereunder shall cease.
3.Employment Period. If a Change in Control of the Company occurs when the
Executive is employed by the Company, the Company will continue thereafter to
employ the Executive during the Employment Period, and the Executive will remain
in the employ of the Company, in accordance with and subject to the terms and
provisions of this Agreement (including, without limitation, the Executive's
right to exercise a Discretionary Termination), and the terms of this Agreement
shall expressly supersede the terms and conditions of any other then existing
employment arrangement or agreement between the Company and the Executive.
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4.Duties. During the Employment Period, the Executive shall, in the same
capacities and positions held by the Executive at the time immediately prior to
the Change in Control of the Company or in such other capacities and positions
as may be agreed to by the Company and the Executive in writing, devote the
Executive's best efforts and all of the Executive's business time, attention and
skill to the business and affairs of the Company, as such business and affairs
now exist and as they may hereafter be conducted. The services which are to be
performed by the Executive hereunder are to be rendered in the same metropolitan
area in which the Executive was employed immediately prior to the time of such
Change in Control of the Company, or in such other place or places as shall be
mutually agreed upon in writing by the Executive and the Company from time to
time. Without the Executive's consent (which may be withheld in the Executive's
discretion), the Executive shall not be required to be absent from such
metropolitan area more than forty-five (45) days in any twelve (12) month period
or for more than fourteen (14) consecutive days.
5.Compensation. During the Employment Period, the Executive shall be compensated
as follows:
(a)The Executive shall receive, at such intervals and in accordance with such
standard policies of the Company as may be in effect immediately prior to the
Change in Control of the Company, an annual base salary in cash of not less than
the Executive's annual base salary plus any annualized bonus amounts received or
receivable as in effect immediately prior to the Change in Control of the
Company and all other compensation otherwise reportable on a Form W-2 (which
base salary, bonus and other compensation shall, unless otherwise agreed in
writing by the Executive, include the current receipt by the Executive of any
amounts which, prior to the Change in Control of the Company, the Executive had
elected to defer, whether such compensation is deferred under Section 401(k) of
the Code or otherwise), subject to adjustment as hereinafter provided.
(b)The Executive shall, at such intervals and in accordance with such standard
policies as may be in effect immediately prior to the Change in Control of the
Company, be reimbursed for any and all monies advanced in connection with the
Executive's employment for reasonable and necessary expenses incurred by the
Executive on behalf of the Company, including travel and entertainment expenses.
(c)From the date of a Change in Control of the Company (regardless of whether
the Executive has ceased to be employed by the Company for any reason) until he
reaches age 85, the Executive and the Executive's wife, and each of their
children until they reach the age of 21, shall each be entitled to receive,
without cost, premium, co-pay or deductible charges, full health and medical,
dental and vision care as provided by the Company to its senior executive
employees; provided, that the Executive and his wife shall not be limited to
their choice(s) of doctor or the location(s) at which such care is provided. In
the event that the Executive dies prior to reaching age 85, his wife shall
continue to receive such health care benefits on the same terms and conditions,
until the date when the Executive would have otherwise reached age 85 but for
his death, and each of their children shall continue to receive such health care
benefits on the same terms and conditions until they reach age 21. From the date
of a Change in Control of the Company (regardless of whether the Executive has
ceased to be employed by the Company for any reason) until he reaches age 65,
the Executive will also be entitled to the benefit of a long-term and short-term
disability insurance policy of $3,000 per month, and in the event that the
Executive dies prior to reaching age 65, his wife shall receive the benefits or
continued coverage of such policies (as the case may be). From the date of a
Change in
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Control of the Company (regardless of whether the Executive has ceased to be
employed by the Company for any reason), the Company will not, without the
Executive's consent, make any changes in the foregoing benefits that would
adversely affect in any material respect the rights or benefits of the Executive
or his wife or children thereunder. During the Employment Period, the Executive
shall also be entitled to receive any other perquisites generally made
available, from time to time or at any time, to the Company's key management
personnel. Any payments under this Section 5(c) shall be in addition to any
other payments or benefits to be received by the Executive under this Agreement
or otherwise.
(d)The Executive shall annually be entitled to not less than the amount of paid
vacation and not fewer than the number of paid holidays to which the Executive
was entitled annually immediately prior to the Change in Control of the Company
or such greater amount of paid vacation and number of paid holidays as may be
made available annually to other executives of the Company of comparable status
and position to the Executive.
(e)The Executive shall be included in all plans providing additional benefits to
executives of the Company of comparable status and position to the Executive,
including but not limited to deferred compensation, split-dollar life insurance,
supplemental retirement, stock option, stock appreciation, stock bonus, cash
bonus and similar or comparable plans; provided, that, in no event shall the
aggregate level of benefits under such plans be less than the aggregate level of
benefits under plans of the Company of the type referred to in this Section 5(e)
in which the Executive was participating immediately prior to the Change in
Control of the Company.
(f) Immediately upon a Change in Control of the Company, all awards granted to
the Executive and then outstanding under the Company's stock option and
incentive compensation plans ("Executive Awards") that are not then exercisable
by their terms automatically will become immediately exercisable and fully
vested for the remainder of their stated terms. In addition, for a period of
thirty (30) days following such Change in Control of the Company, the Executive
shall have the right to terminate the Executive Awards and to receive a lump-sum
payment, in cash, equal to the product of (a) the excess of (x) the per-unit
fair market value of the securities underlying the Executive Awards, over (y)
the per-unit exercise price of such Executive Awards, and (b) the number of
units of such securities covered by the Executive Awards. For purposes of the
preceding sentence, the "fair market value" of securities shall be based on the
highest of (i) the per-unit closing sale price of the securities underlying the
Executive Awards, as reported on a national securities exchange or by the Nasdaq
Stock Market, on the execution date of the agreement pursuant to which the
Change in Control of the Company is effected, (ii) the per-unit closing sale
price of the securities underlying the Executive Awards, as reported on a
national securities exchange or by the Nasdaq Stock Market, on the effective
date of the transaction constituting a Change in Control of the Company, and
(iii) the highest per-unit price for such securities actually paid in connection
with such Change in Control of the Company. Notwithstanding the foregoing, if
the exercise of any right granted pursuant to this Section 5(f) would make a
transaction constituting a Change in Control of the Company ineligible for
pooling of interests accounting under XXX Xx. 00 which, but for this Section
5(f), would otherwise be eligible for such accounting treatment, the Board of
Directors of the Company shall have the ability to substitute for the cash
payable pursuant to this Section 5(f) securities of the Company (or of the other
entity surviving the transaction constituting the Change in Control of the
Company, or its parent corporation, if applicable) having a fair market value
equal to the cash that would otherwise be payable hereunder. For purposes of the
preceding sentence, the "fair market
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value" of securities shall be based on the lower of (i) the average closing bid
price of such securities for the ten (10) trading days prior to the execution
date of the agreement pursuant to which the Change in Control of the Company is
effected, and (ii) the average of the closing bid price of such securities for
the ten (10) trading days prior to the effective date of the transaction
constituting a Change in Control of the Company, in each case as such closing
bid prices are reported on a national securities exchange or by the Nasdaq Stock
Market.
6.Annual Compensation Adjustments. During the Employment Period, the Board of
Directors of the Company (or an appropriate committee thereof) will consider and
appraise, at least annually, the contributions of the Executive to the Company's
operating and/or administrative efficiency, growth, cash flow from operations
and operating profits, and, in accordance with the Company's practice prior to
the Change in Control of the Company, due and good faith consideration shall be
given to the upward adjustment of the Executive's base compensation rate, at
least annually, commensurate with (i) increases generally given to other
executives of the Company of comparable status and position to the Executive,
and (ii) as the scope of the Company's operations or the Executive's duties
expand.
7.Termination For Cause or Without Good Reason. If there is a Covered
Termination for Cause or due to the Executive's voluntarily terminating his
employment other than for Good Reason or a Discretionary Termination (any such
terminations to be subject to the procedures set forth in Section 13 hereof),
then the Executive shall be entitled to receive only Accrued Benefits pursuant
to Section 9(a) hereof.
8.Termination Giving Rise to a Termination Payment. (a) If there is a Covered
Termination by the Executive for Good Reason or a Discretionary Termination, or
by the Company other than by reason of (i) death, (ii) disability pursuant to
Section 12 hereof, or (iii) Cause, then the Executive shall be entitled to
receive, and the Company shall promptly pay, Accrued Benefits pursuant to
Section 9(a) hereof and, in lieu of further base salary for periods following
the Termination Date, as liquidated damages and severance pay, the Termination
Payment pursuant to Section 9(b) hereof.
(b)If there is a Covered Termination and the Executive is entitled to Accrued
Benefits and the Termination Payment, then the Executive shall be entitled to
the following additional benefits:
(i)The Executive shall receive, at the expense of the Company, outplacement
services on an individual basis provided by a nationally recognized executive
placement firm selected by the Company and acceptable to Executive until the
earlier of the third anniversary of the Termination Date or such time as the
Executive has obtained new full-time employment comparable to his position at
the Company.
(ii)Until the earlier of the third anniversary of the Termination Date or such
time as the Executive has obtained new employment and is covered by benefits
which in the aggregate are at least equal in value to the following benefits the
Executive shall continue to be covered, at the expense of the Company, by the
same or equivalent life insurance, hospitalization, medical and dental coverage
as was required hereunder with respect to the Executive immediately prior to the
date the Notice of Termination is given.
9.Payments Upon Termination. (a)Accrued Benefits. For purposes of this
Agreement, the Executive's "Accrued Benefits" shall include the following
amounts, payable as described herein: (i) all base salary for the time period
ending with the Termination Date; (ii) reimbursement for any and all monies
advanced in connection with the Executive's employment for reasonable and
necessary expenses incurred by the Executive on behalf of the Company for the
time period ending with the Termination
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Date; (iii) any and all other cash earned though the Termination Date and
deferred at the election of the Executive or pursuant to any deferred
compensation plan then in effect; (iv) a lump sum payment of the bonus,
incentive compensation and other compensation reportable on Form W-2 otherwise
payable to the Executive with respect to the year in which termination occurs
under all bonus or incentive compensation plan or plans of the Company in which
the Executive is a participant; and (v) all other payments and benefits to which
the Executive may be entitled as compensatory fringe benefits or under the terms
of any benefit plan of the Company, including severance payments under the
Company's severance policies and practices as in effect immediately prior to the
Change in Control of the Company. Payment of Accrued Benefits shall be made
promptly in accordance with the Company's prevailing practice with respect to
Subsections (i) and (ii) or, with respect to Subsections (iii), (iv) and (v),
pursuant to the terms of the benefit plan or practice establishing such
benefits.
(b)Termination Payment. The Termination Payment shall be an amount equal to the
average of the Executive's annual total compensation reportable by the Company
on Form W-2 (i.e., base salary plus bonus amounts and all other taxable
compensation) over the five (5) fiscal years of the Company immediately prior to
the Change in Control of the Company (with such compensation annualized for any
initial partial year of employment) multiplied by three (3); provided that if
the Executive has been employed by the Company for less than three (3) years,
then the Termination Payment shall be an amount equal to the highest amount of
the Executive's annual total compensation for any year during the period of his
employment by the Company prior to the Change in Control of the Company
multiplied by three (3). Except as otherwise provided herein, the Termination
Payment shall be paid to the Executive in cash no later than ten (10) business
days after the Termination Date; provided, however, the Termination Payment
shall be paid to the Executive immediately upon receipt by the Company of a
Notice of Termination relating to a Discretionary Termination (regardless of any
differing effective date of the Executive's employment termination). The
Executive shall not be required to mitigate the amount of the Termination
Payment by securing other employment or otherwise, nor will such Termination
Payment be reduced by reason of the Executive securing other employment or for
any other reason.
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In the event that a portion of the Termination Payment, Accrued Benefits or any
other payment or benefit under this Agreement, or payments to or for the benefit
of the Executive under any other agreement or plan of the Company ("Total
Benefits"), be deemed to be an "excess parachute payment," as defined in Section
280G of the Code, then the Company shall pay the Executive, no later than the
tenth day following the Executive's request, such additional cash amount as is
necessary to place the Executive in the same after-tax financial position that
he would have been in if he had not incurred any liability for Excise Tax
("Excise Tax Liability") under Section 4999 of the Code (the "Gross-Up
Payment"). For purposes of determining whether any of the Total Benefits will be
subject to Excise Tax Liability and the amount of such Excise Tax Liability, (i)
Total Benefits shall be treated as "parachute payments" (within the meaning of
Section 280G(b)(2) of the Code) unless, in the reasonable opinion of the
Company's tax counsel (as confirmed by the Executive's tax counsel), such Total
Benefits (in whole or in part) do not constitute parachute payments, including
by reason of Section 280G(b)(4)(A) of the Code, and all "excess parachute
payments" (within the meaning of Section 280G(b)(1) of the Code) shall be
treated as subject to Excise Tax Liability, unless, in the reasonable opinion of
the Company's tax counsel (as confirmed by the Executive's tax counsel), such
excess parachute payments represent reasonable compensation for services
actually rendered within the meaning of Section 280G(b)(4)(B) of the Code, or
are not otherwise subject to Excise Tax Liability, and (ii) the value of any
noncash benefits or any deferred payment or benefit shall be determined by the
Company's independent auditors in accordance with the principles of Sections
280G(d)(3) and (4) of the Code. For purposes of determining the amount of the
Gross-Up Payment, the Executive shall be deemed to pay federal income taxes at
the highest marginal rate of federal income taxation in the calendar year in
which the Gross-Up Payment is to be made and state and local income taxes at the
highest marginal rate of taxation in the state and locality of the residence of
the Executive, net of the maximum reduction in federal income taxes that could
be obtained from deduction of such state and local taxes.
10.Death. (a) Except as provided in Section 10(b) hereof, in the event of a
Covered Termination due to the Executive's death, the Executive's estate, heirs
and beneficiaries shall receive all the Executive's Accrued Benefits through the
Termination Date. (b)In the event the Executive dies after a Notice of
Termination is given (i) by the Company, other than by reason of disability, or
(ii) by the Executive for Good Reason or a Discretionary Termination, the
Executive's estate, heirs and beneficiaries shall be entitled to the benefits
described in Section 10(a) hereof and, subject to the provisions of this
Agreement, to such Termination Payment as the Executive would have been entitled
to had the Executive lived. For purposes of this Section 10(b), the Termination
Date shall be the earlier of thirty (30) days following the giving of the Notice
of Termination or one day prior to the end of the Employment Period, subject to
delay pursuant to Section 1(l) hereof.
11.Retirement. If, during the Employment Period, the Executive and the Company
shall execute an agreement providing for the early retirement of the Executive
from the Company, or the Executive shall otherwise give notice that he is
voluntarily choosing to retire early from the Company, the Executive shall
receive Accrued Benefits through the Termination Date; provided, that if the
Executive's employment is terminated by the Executive for Good Reason or a
Discretionary Termination or by the Company other than by reason of
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death, disability or Cause and the Executive also, in connection with such
termination, elects voluntary early retirement, the Executive shall also be
entitled to receive a Termination Payment pursuant to Section 9(b) hereof.
12.Termination for Disability. If, during the Employment Period, as a result of
the Executive's disability due to physical or mental illness or injury
(regardless of whether such illness or injury is job-related), the Executive
shall have been absent from the Executive's duties hereunder on a full-time
basis for twelve (12) consecutive months and, within thirty (30) days after the
Company notifies the Executive in writing that it intends to terminate the
Executive's employment (which notice shall not constitute the Notice of
Termination contemplated below), the Executive shall not have returned to the
performance of the Executive's duties hereunder on a substantially full-time
basis, the Company may terminate the Executive's employment pursuant to a Notice
of Termination given in accordance with Section 13 hereof. In the event the
Executive's employment is terminated on account of the Executive's disability in
accordance with this Section, the Executive shall receive Accrued Benefits in
accordance with Section 9(a) hereof and shall remain eligible for all benefits
provided by any long term disability programs of the Company in effect at the
time of such termination.
13.Termination Notice and Procedure. Any Covered Termination by the Company or
the Executive shall be communicated by written Notice of Termination to the
Executive, if such Notice is given by the Company, and to the Company, if such
Notice is given by the Executive, all in accordance with the following
procedures and those set forth in Section 23 hereof:
(a)If such termination is for disability, Cause or Good Reason, the Notice of
Termination shall indicate in reasonable detail the facts and circumstances
alleged to provide a basis for such termination. (No such detail need be
provided for in a Discretionary Termination).
(b)Any Notice of Termination by the Company shall have been approved, prior to
the giving thereof to the Executive, by a resolution duly adopted in good faith
by a majority of the directors of the Company (or any successor corporation)
then in office.
(c)The Executive shall have thirty (30) days, or such longer period as the
Company may determine to be appropriate, to cure any conduct or act, if curable,
alleged to provide grounds for termination of the Executive's employment for
Cause under this Agreement.
(d)The recipient of the Notice of Termination shall personally deliver or mail
in accordance with Section 23 hereof written notice of any dispute relating to
such Notice of Termination to the party giving such Notice within fifteen (15)
days after receipt thereof; provided, however, that a Notice of Termination
relating to a Discretionary Termination shall not be subject to dispute for any
reason by the Company or otherwise. After the expiration of such fifteen (15)
days (or immediately upon receipt of a Notice of Termination relating to a
Discretionary Termination), the contents of the Notice of Termination shall
become final and not subject to dispute.
14.Confidentiality Obligations of the Executive; Noncompetition.
(a)During and following the Executive's employment by the Company, the Executive
shall hold in confidence and not directly or indirectly disclose or use or copy
or make lists of any confidential information or proprietary data of the
Company, except to the extent authorized in writing by the Board of Directors of
the Company or required by any court or administrative agency, other than to an
employee of the Company or a person to whom disclosure is reasonably necessary
or appropriate in connection with the performance by the Executive of
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duties as an executive of the Company. Confidential information shall not
include any information known generally to the public or any information of a
type not otherwise considered confidential by persons engaged in the same
business or a business similar to that of the Company. All records, files,
documents and materials, or copies thereof, relating to the business of the
Company which the Executive shall prepare, or use, or come into contact with,
shall be and remain the sole property of the Company and shall be promptly
returned to the Company upon termination of employment with the Company.
(b)The Executive agrees that, in the event of a Covered Termination in which the
Executive has or will receive a Termination Payment, for a period of two years
after the Termination Date or until the end of the Employment Period, whichever
is shorter, the Employee shall not, within a one hundred (100) mile radius of
any office, landfill or facility of the Company, except as permitted by the
Company's prior written consent (which shall not be unreasonably withheld),
participate in the management of any business which is a direct and substantial
competitor of the Company. The ownership of less than one percent of any class
of securities of any corporation listed on a national securities exchange or
regularly traded over the counter even though such corporation may be a
competitor of the Company as specified above, shall not be deemed as
constituting a financial interest in such competitor.
15.Expenses and Interest. If, after a Change in Control of the Company, a good
faith dispute arises with respect to the enforcement of the Executive's rights
under this Agreement or if any legal or arbitration proceeding shall be brought
in good faith to enforce or interpret any provision contained herein, or to
recover damages for breach hereof, the Executive shall recover from the Company
any reasonable attorneys' fees and necessary costs and disbursements incurred as
a result of such dispute, legal or arbitration proceeding ("Expenses"), and
prejudgment interest on any money judgment or arbitration award obtained by the
Executive calculated at the rate of interest announced by Firstar
Bank-Milwaukee, N.A. from time to time as its prime or base lending rate from
the date that payments to him should have been made under this Agreement. Within
ten (10) days after the Executive's written request therefor, the Company shall
pay in cash to the Executive, or such other person or entity as the Executive
may designate in writing to the Company, the Executive's reasonable Expenses in
advance of the final disposition or conclusion of any such dispute, legal or
arbitration proceeding.
16.Payment Obligations Absolute. The Company's obligation during and after the
Employment Period to pay the Executive the amounts and to make the benefit and
other arrangements provided herein shall be absolute and unconditional and shall
not be affected by any circumstances, including, without limitation, any set
off, counterclaim, recoupment, defense or other right which the Company may have
against him or anyone else. Except as provided in Section 15 of this Agreement,
all amounts payable by the Company hereunder shall be paid without notice or
demand. Except as provided in Section 9(b) of this Agreement, each and every
payment made hereunder by the Company shall be final, and the Company will not
seek to recover all or any part of such payment from the Executive, or from
whomsoever may be entitled thereto, for any reason whatsoever.
17.Assignment; Successors. (a) If the Company proposes to sell, assign or
transfer all or substantially all of its business and assets to any Person, or
if the Company proposes to merge into or consolidate or otherwise combine with
any Person (in either case, whether before or after the IPO Effective Date),
then, at least thirty (30) days in advance of the closing of such event, the
Company shall, subject only to consummation of such Change in Control of the
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Company, assign all of its right, title and interest in this Agreement effective
as of the closing date of such event to such Person, and the Company shall cause
such Person, at least thirty (30) days in advance of the closing of such event,
by written agreement in form and substance reasonably satisfactory to the
Executive and with written notice thereof to Executive, to expressly assume and
agree to perform, subject only to consummation of such Change in Control of the
Company, from and after the effective date of such event all of the terms,
conditions and provisions imposed by this Agreement upon the Company. If such
Change in Control of the Company is consummated, failure of the Company to
obtain such an assumption agreement at least thirty (30) days in advance of the
closing of such event shall be a breach of this Agreement constituting "Good
Reason" hereunder, except that for purposes of implementing the foregoing, the
date upon which such transfer or other succession becomes effective shall be
deemed the Termination Date. In case of an effective assignment by the Company
and of assumption and agreement by such Person, "Company" shall thereafter mean
such Person which executes and delivers the agreement provided for in this
Section 17 or which otherwise becomes bound by all the terms and provisions of
this Agreement by operation of law, and this Agreement shall inure to the
benefit of and be enforceable by such Person. The Executive shall, in his
discretion, be entitled to proceed against any or all of such Persons, any
Person which theretofore was such a successor to the Company (as defined in the
first paragraph of this Agreement) and the Company (as so defined) in any action
to enforce any rights of the Executive hereunder. Except as provided in this
Subsection, this Agreement shall not be assignable by the Company. This
Agreement shall not be terminated by the voluntary or involuntary dissolution of
the Company.
(b)This Agreement and all rights of the Executive shall inure to the benefit of
and be enforceable by the Executive's personal or legal representatives,
executors, administrators, heirs and beneficiaries. All amounts payable to the
Executive under Sections 7, 8, 9, 10, 11 and 12 hereof if the Executive had
lived shall be paid, in the event of the Executive's death, to the Executive's
estate, heirs and representatives.
18.Severability. The provisions of this Agreement shall be regarded as
divisible, and if any of said provisions or any part hereof are declared invalid
or unenforceable by a court of competent jurisdiction, the validity and
enforceability of the remainder of such provisions or parts hereof and the
applicability thereof shall not be affected thereby.
19.Amendment. This Agreement may not be amended or modified at any time except
by written instrument executed by the Company and the Executive.
20.Withholding. The Company shall be entitled to withhold from amounts to be
paid to the Executive hereunder any federal, state or local withholding or other
taxes or charges which it is from time to time required to withhold; provided,
that the amount so withheld shall not exceed the minimum amount required to be
withheld by law. The Company shall be entitled to rely on an opinion of
nationally recognized tax counsel if any question as to the amount or
requirement of any such withholding shall arise.
21.Certain Rules of Construction. No party shall be considered as being
responsible for the drafting of this Agreement for the purpose of applying any
rule construing ambiguities against the drafter or otherwise. No draft of this
Agreement shall be taken into account in construing this Agreement. Any
provision of this Agreement which requires an agreement in writing shall be
deemed to require that the writing in question be signed by the Executive and an
authorized representative of the Company.
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22.Governing Law: Resolution of Disputes. This Agreement and the rights and
obligations hereunder shall be governed by and construed in accordance with the
laws of the State of Wisconsin. Any dispute arising out of this Agreement shall,
at the Executive's election, be determined by arbitration under the rules of the
American Arbitration Association then in effect or by litigation. Whether the
dispute is to be settled by arbitration or litigation, the venue for the
arbitration or litigation shall be Milwaukee, Wisconsin or, at the Executive's
election, in the judicial district encompassing the city in which the Executive
resides. The parties consent to personal jurisdiction in each trial court in the
selected venue having subject matter jurisdiction notwithstanding their
residence or situs, and each party irrevocably consents to service of process in
the manner provided hereunder for the giving of notices.
23.Notice. Notices given pursuant to this Agreement shall be in writing and,
except as otherwise provided by Section 13(d) hereof, shall be deemed given when
actually received by the Executive or actually received by the Company's
Secretary or any officer of the Company other than the Executive. If mailed,
such notices shall be mailed by United States registered or certified mail,
return receipt requested, addressee only, postage prepaid, if to the Company, to
Superior Services, Inc., Attention: Secretary, 00000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx
000, Xxxx Xxxxx, Xxxxxxxxx 00000, or if to the Executive, at the address set
forth below the Executive's signature to this Agreement, or to such other
address as the party to be notified shall have theretofore given to the other
party in writing. A copy of any notice provided hereunder by either party shall
be provided to Xxxxxx X. Xxxxx, Xxxxx & Xxxxxxx, 000 Xxxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxx 00000.
00.Xx Waiver. No waiver by either party at any time of any breach by the other
party of, or compliance with, any condition or provision of this Agreement to be
performed by the other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same time or any prior or subsequent time.
25.Headings. The headings herein contained are for reference only and shall not
affect the meaning or interpretation of any provision of this Agreement.
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26. Effect on Other Agreements. No provision of this Agreement shall limit the
Company's obligation to make payments and provide benefits otherwise receivable
by the Executive under the any other agreement, regardless of whether or not the
Executive exercises his right to a Discretionary Termination hereunder."
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first written above.
EXECUTIVESUPERIOR SERVICES, INC.
_____________________________ By:___________________________________
Xxxxxx X. Xxxx G. Xxxxxxx Xxxxxxxx
Chief Executive Officer
Address:
000 Xxxxxxx
Xxxx Xxxxxxxx, Xxxxxxxxx 00000
