Exhibit 99.2
[LOGO]
US LIQUIDS
November 15, 2000
Mr. X. Xxxxxxx Xxx
000 Xxxxxxxxxxx Xxxx
Xxxxxxx, Xxxxx 00000
Dear Xxxx:
In connection with your anticipated separation from US Liquids Inc.
(the "Company") and in consideration of your significant contributions and
valuable service to the Company, you and the Company have agreed to the terms
and conditions as contained in this letter agreement (this "Agreement") and the
attachment to this Agreement, with such attachment being part of this Agreement
for all purposes (the "Attachment"), concerning your separation from employment
with the Company as of the close of business on November 15, 2000 (your
"Separation Date").
In consideration of the Company's agreement to provide the benefits,
payments and other items described in this Agreement, which are in addition to
anything to which you are already entitled and the receipt and sufficiency of
which are hereby acknowledged:
1. Release. You hereby agree to release and forever discharge the
-------
Company and its parents, subsidiaries and affiliates, and their officers,
directors, agents, servants, employees, successors, assigns and insurers,
and any and all other persons, firms, organizations and corporations from
any and all damages, losses, causes of action, expenses, demands,
liabilities and claims on behalf of yourself and your heirs, executors,
administrators and assigns with respect to any and all matters relating to
the Company and its parents, subsidiaries and affiliates, and you hereby
accept the cash payments, benefits and other items described herein in full
settlement of all such damages, losses, causes of action, expenses,
demands, liabilities and claims you now have or may have with respect to
such matters (except you shall retain all rights to (i) coverage, if any,
under directors' and officers' fiduciary errors and omissions and other
liability insurance policies of the Company that by their terms would apply
to your acts and omissions while serving the Company, its subsidiaries and
affiliates, and their respective officers, directors, agents, servants,
employees and their successors and assigns, (ii) any indemnification
arrangements with the Company (including pursuant to the Company's
Bylaws) that apply to your service with the Company, its subsidiaries and
affiliates) and (iii) claims arising from a breach of this Agreement.
This release includes, but is not limited to, claims arising under the
Age Discrimination in Employment Act, the Older Workers' Benefit Protection
Act, Title VII of the Civil Rights Act of 1964, the Americans with
Disabilities Act, the Family and Medical Leave Act, the Texas Labor Code,
any state or federal statute, regulation or common law pertaining to
"whistle-blowers," any claims for breach of contract, tort or personal
injury of any sort, and any claims under any other state or federal statute
or regulation, in equity or at common law. Further, by accepting the
payments described in this Agreement, you agree not to sue the Company or
the related persons and entities described above with respect to any
matters released hereunder. You affirm and agree that your employment
relationship ends on your Separation Date, and as of such date you withdraw
unequivocally, completely and finally from your employment, you resign all
positions, titles, responsibilities and authority as an officer or employee
of the Company and its subsidiaries and affiliates and you waive all rights
in connection with such relationship except to vested benefits and the
payments, benefits and other items described in the Attachment and this
Agreement. You agree that this Agreement is valid, fair, adequate and
reasonable, was entered into with your full knowledge and consent and was
not procured through fraud, duress or mistake. You shall have 21 days to
decide whether to sign the Agreement and be bound by its terms. You shall
have the right to revoke or cancel it within 7 days after you have signed
it. This cancellation or revocation can be accomplished by delivery of a
written notification to me. In the event that this Agreement is canceled or
revoked, the Company shall have no obligation to furnish the payments,
benefits and other items described herein and in the Attachment, except for
any rights to benefits under the US Liquids 401(k) & Profit Sharing Plan
and any of the Company stock option awards that are otherwise vested as of
your Separation Date. You acknowledge that you have been advised in writing
to consult with an attorney prior to signing this Agreement and have had an
adequate opportunity to seek advice of your own choosing. You acknowledge
that you have read this Agreement, have had an opportunity to ask questions
and have it explained to you and that you understand that the Agreement
will have the effect of knowingly and voluntarily waiving any action you
might pursue, including breach of contract, personal injury, retaliation,
discrimination on the basis of race, age, sex, national origin or
disability, and any other claims arising prior to the date of the
Agreement.
In consideration of your agreements in this Agreement, the Company,
its parents, subsidiaries, affiliates, predecessors and successors hereby
release and forever discharge you from any and all damages, losses, causes
of action, expenses, demands, liabilities and claims with respect to all
matters relating to or arising from your employment including without
limitation any and all of your actions or inactions done while employed by
the Company or its predecessors, subsidiaries or affiliates. Without
limiting any applicable insurance coverage or other indemnification
arrangements, you shall be indemnified by the Company to the fullest extent
permitted under Delaware Law and shall be entitled to advancement of
expenses in any action, suit or proceeding in which indemnification is
proper under Delaware Law. The Company agrees you have
the right to select the lawyer at Company expense mutually agreeable to the
Company (with approval not to be withheld unreasonably by the Company) for
your defense to such claims, suits, or proceedings.
2. Noncompete Agreement. In return for the benefits provided in the
--------------------
Attachment, you further agree that, during the two (2) year period
beginning on your Separation Date and ending on the second anniversary of
your Separation Date (the "Noncompete Period"), (A) within a 75-mile radius
of the location of each of the facilities listed in the Company's Form 10-K
filed with the Securities and Exchange Commission on March 28, 2000, a copy
of such list which is attached hereto as Exhibit A (the "Facilities"),
OTHER THAN Facilities involved in the businesses of the collection,
transportation, processing, treatment and/or disposal of hazardous waste
(the "Hazardous Waste Business") or the collection, transportation and/or
processing of nonsaleable/outdated beverages, including the recycling of
the containers and/or the production and sale (including brokerage) of
ethanol (the "Beverage Business"), for the specific business engaged in by
each such Facility; (B) within a 600-mile radius of the location of each of
the Facilities involved in the Hazardous Waste Business or the Beverage
Business for the specific business engaged in by each such Facility; and
(C) within the Boston, Massachusetts and Denver, Colorado metropolitan
areas for the Hazardous Waste Business and the Beverage Business
(collectively, the "Relevant Geographic Area"), you will not, directly or
indirectly, engage in any business competitive with the above businesses of
the Company or any of its subsidiaries within the applicable Relevant
Geographic Area (the "Prohibited Activity"); provided, however, that the
foregoing shall not be deemed to prevent you from (i) investing in
securities of a company which is publicly traded, so long as such
investment holdings do not, in the aggregate, constitute more than 5% of
any class of such company's securities or (ii) serving as a director of a
company which engages in business that is competitive with the Company or
any of its subsidiaries in the Relevant Geographic Area if you and such
company agree that you cannot and will not as a director act or otherwise
advise such company on any matter involving the Prohibited Activity.
You acknowledge that you have been employed for your special talents
and that your leaving the employ of the Company would seriously and
adversely affect the business of the Company. In addition to all remedies
permitted by law or in equity and without limiting any injunctive or other
relief to which the Company may be entitled in respect of any of your
obligations under the Agreement, the Company shall be entitled to
injunctive relief to enforce the provisions of this Paragraph 2; provided,
however, that the Company shall not be entitled to injunctive relief or any
other relief with respect to this Paragraph 2 if at the time such relief is
sought the Company has been in default of any of its obligations to you
under this Agreement.
3. Confidentiality Agreement. You acknowledge that throughout the
-------------------------
duration of your employment, the Company has provided you with a
substantial amount of data, information and knowledge which are trade
secrets or confidential or proprietary
information of the Company and its affiliates. You agree that you will not
at any time on and after your Separation Date without prior written consent
of the Company or as may be otherwise required by law or legal process,
directly or indirectly communicate, divulge, furnish, use, publish or make
accessible to any person or entity any Confidential Information (as
hereinafter defined). Any records of Confidential Information prepared by
you or which come into your possession during your employment are and
remain the property of the Company. Except as otherwise required as part of
your continuing director duties, upon your Separation Date all such records
and copies thereof shall be either left with or returned to the Company.
For purposes of this Paragraph 3, the term "Confidential Information" shall
mean the information disclosed to you or known, learned, created or
observed by you as a consequence of or through your employment by the
Company, not generally known in the relevant trade or industry, about the
Company's business activities, products, customers, suppliers, services and
procedures, including, but not limited to, information concerning costs,
product performance, customer requirements, advertising, sales promotion,
publicity, sales data, research, finances, accounting, methods, procedures,
trade secrets, business plans, client or supplier lists and trade secrets,
business plans, client or supplier lists and records, potential client or
supplier lists and client or supplier billing. Notwithstanding the
foregoing, "Confidential Information" shall not include information
publicly disclosed by the Company or known by you other than because of
your employment with the Company.
4. Nonsolicitation Agreement. You agree that you will not, during the
-------------------------
period of two (2) years after your Separation Date, either in your
individual capacity or as an agent for another, hire or offer to hire or
entice away any person who has been an officer, employee or agent of the
Company at any time during the year immediately preceding your Separation
Date or in any other manner persuade or attempt to persuade any of such
persons to discontinue their relationship with the Company or any of its
subsidiaries nor divert or attempt to divert from the Company or any of its
subsidiaries any business whatsoever by influencing or attempting to
influence any customer or supplier of the Company or any of its
subsidiaries to diminish or discontinue its business with the Company or
such subsidiary.
5. Benefits Under All Other Agreements, Arrangements and Plans. You
-----------------------------------------------------------
hereby agree that the benefits, payments and other items described in this
Agreement and the Attachment supersede, replace and are in lieu of any and
all benefits, payments or other items that may have been due to you under
any other agreements, arrangements or plans with, or of, the Company,
including, but not limited to, your employment agreement with the Company,
effective February 13, 1998, except as otherwise provided herein and in the
Attachment.
The purpose of the arrangements described in this Agreement is to
arrive at a mutually agreeable and amicable basis upon which to separate your
employment with the Company. You and the Company agree to refrain from any
criticisms or disparaging comments
about each other or in any way relating to your employment with or separation
from the Company. Furthermore, you agree that you have returned or will return
immediately, and to maintain in strictest confidence and not to use in any way,
any proprietary, confidential or other nonpublic information or documents
relating to the business and affairs of the Company and its affiliates. You
agree to refer all media, shareholder and investment or financial community
inquiries regarding the Company to the Company without comment or other response
to such inquiries.
The Company agrees that, following your Separation Date, you will
continue to serve as a member of the Company's Board of Directors for the
remainder of your term in effect as of your Separation Date, subject to the
provisions of Section 3.10 of the Amended and Restated Bylaws of U.S. Liquids
Inc., dated June 16, 1997.
Should any of the provisions set forth in this Agreement be determined
to be invalid by a court, agency or other tribunal of competent jurisdiction,
you agree that such determination shall not affect the enforceability of other
provisions of this Agreement.
The Company shall have the right to recover any payment made to you in
excess of the amount to which you are entitled under the terms of this
Agreement. Such recovery may be from you or your beneficiary thereby enriched.
You further agree that the terms of this Agreement, including all
terms and conditions contained in the Attachment, shall be kept strictly
confidential and that any disclosure to anyone for any purpose whatsoever (save
and except disclosure to your spouse, to financial institutions as part of a
financial statement, to immediate family members and/or heirs, to financial, tax
and legal advisors, or as required by law) by you or your agents,
representatives, heirs, children, spouse, employees or spokespersons shall be a
breach of this Agreement; provided, however, in the event the Company believes a
breach of confidentiality has occurred, you will be given notice and 30 days to
respond. You also further agree that the Company may disclose this Agreement or
its terms to the extent reasonably necessary to comply with applicable
securities laws or regulations or requirements of the Securities and Exchange
Commission.
Should you be contacted or served with legal process seeking to compel
you to disclose any such information, you agree to notify the Company's General
Counsel immediately in order that the Company may seek to resist such process if
it so chooses. If you are called upon to serve as a witness or consultant in or
with respect to any potential litigation, litigation or regulatory proceeding,
you agree to cooperate with the Company to the full extent permitted by law and
the Company agrees that any such call shall be with reasonable notice and shall
not unnecessarily interfere with your later business endeavors or employment.
The Company will reimburse you for any reasonable travel or other business
expenses incurred in connection with providing such assistance, but you shall
not be entitled to any other compensation for such assistance other than that
described in this Agreement.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware and, where applicable, the laws of the United
States.
The Company and you agree that all disputes concerning this Agreement
shall be arbitrated in Houston, Texas, pursuant to the American Arbitration
Association's National Rules for the Resolution of Employment Disputes. The
arbitration proceedings shall be conducted by a sole arbitrator who shall be an
attorney with not less than 10 years experience in commercial or employment law.
All disputes or claims of the parties shall be consolidated into a single
arbitration proceeding. The award or determination of the arbitrator shall be
final and binding on all parties and shall be enforceable in a court of
competent jurisdiction. The arbitrator shall have the authority to award costs
and expenses of arbitration to either party as the arbitrator sees fit.
Very truly yours,
US LIQUIDS INC.
/s/ Xxxxxxx X. Xxxxxx
-------------------------------
Xxxxxxx X. Xxxxxx
Chief Executive Officer
AGREED TO AND ACCEPTED this
15/th/ day of November, 2000
/s/ X. Xxxxxxx Xxx
-----------------------------
X. Xxxxxxx Xxx
Attachment to the Agreement dated November 15, 2000
1. Vacation
--------
On the first business day following the later of your Separation Date
or the date after the 7-day rescission period described in the Agreement has
expired without your having revoked the Agreement (the "Final Date"), you will
receive a lump-sum payment for all of your earned vacation days, less any
vacation days taken during 2000, plus all of your accrued vacation days, if any,
through your Separation Date, reduced for applicable income tax and FICA
withholding obligations.
2. Incentive Compensation
----------------------
If incentive bonus compensation is paid for 2000 under the Company's
incentive compensation plan in which you participate as of your Separation Date
("Incentive Compensation"), you will receive, on the later of (A) the first
business day following the Final Date or (B) the same time as other participants
receive their Incentive Compensation payments, a prorated portion, based upon
your period of employment during 2000, in the amount of the Incentive
Compensation payment to similarly situated senior executives of the Company,
subject to applicable income tax and FICA withholding obligations.
3. Severance Payments
------------------
You will be paid, on a biweekly basis, on the Company's regular
paydays, severance payments during the period beginning on the day immediately
following your Separation Date and ending on February 12, 2005 (the "Severance
Period") equal in the aggregate to $1,174,038.51, at a biweekly rate of
$10,576.93, subject to applicable income tax and FICA withholding obligations
and any other applicable deductions (the "Severance Payments"). The Severance
Payments shall be in lieu of any other payments or benefits you may have
otherwise been or become eligible to receive under any severance plan, program
or arrangement of the Company.
4. Medical and Dental Coverage
---------------------------
Subject to your payment of applicable premiums, during the Severance
Period, you will be eligible to participate in the medical and dental insurance
coverage benefits provided by the Company to its employees and their spouses and
eligible dependents as in effect immediately prior to your Separation Date and
at the same cost to the Company's executive employees during such period. The
foregoing notwithstanding, your medical and dental benefits under this Paragraph
4 shall be subject to an offset for any such benefits you, your spouse or your
eligible dependents are entitled to under any medical or dental plan, program or
arrangement sponsored or maintained by another employer.
At the end of your Severance Period, you will have the option to
continue your medical and dental insurance coverage benefits for up to 18 months
under COBRA. An
explanation of the coverage and premium schedule will be mailed to you prior to
the expiration of your Severance Period.
5. Life Insurance, STD, LTD and AD&D
---------------------------------
Subject to your payment of applicable premiums, during the Severance
Period you will be able to participate in the life insurance program coverage,
short-term disability and long-term disability coverages and AD&D coverage as
available to you immediately prior to your Separation Date at the same cost as
to the Company's executive employees during such period. After the end of the
Severance Period, if provided under the applicable policy, you will have the
ability to convert the balance of your employee life insurance and your AD&D
coverage, according to the terms and conditions in effect at that time.
Application for conversion must be timely made to the applicable insurance
company. It will be your responsibility to complete the conversion process, if
you so desire. Your short-term and long-term disability coverages will cease at
the end of your Severance Period.
6. 401(k) Plan
-----------
Your participation in the US Liquids 401(k) & Profit Sharing Plan (the
"401(k) Plan") may continue after the Separation Date as and to the extent
allowable under applicable laws and regulations and the terms of the plan. In
the event that anytime after the Separation Date you are prohibited by
applicable laws or regulations or the terms of the 401(k) Plan from continuing
in the 401(k) Plan, or you elect not to continue in the 401(k) Plan, you will be
entitled to your then vested benefits and such vested benefits will be
distributed according to provisions of the 401(k) Plan.
7. Stock Options
-------------
All stock options granted to you by the Company that are outstanding
as of your Separation Date, if any, to the extent not vested, will be fully
vested and exercisable as of your Separation Date. Your outstanding stock
options will continue in full force and effect and remain outstanding and
exercisable after your Separation Date for the remainder of their terms, subject
to the terms and conditions of the applicable stock option agreement. Your stock
options outstanding as of the date of this Agreement are set forth in Schedule A
attached hereto.
8. Office Furniture and Personal Computer
--------------------------------------
You are entitled to retain all furniture, personal property and the
personal computer in your office at the Company; provided, however, that all
such items that you want to retain must be removed no later than 60 days after
your Separation Date, subject to approval by the Company of the removal date or
dates and time or times.
9. Office and Secretarial Allowance
--------------------------------
You are entitled to receive from the Company an allowance in the
amount of $100,000 to assist in defraying your cost incurred by you in
maintaining an office outside of the Company offices and employing secretarial
or other support staff for such office; said allowance to be payable by the
Company in one lump sum payment within ten (10) days of the Separation Date.
