EMPLOYMENT AGREEMENT
Exhibit 10.29
THIS EMPLOYMENT AGREEMENT is made and entered into as of July 1, 2000, or such earlier date as
the parties agree (the “Effective Date”), by and between Xxxx Xxxxxxxxxx (the “Employee”) and Waste
Connections, Inc., a Delaware corporation (the “Company”), with reference to the following facts.
The Company desires to engage the services and employment of the Employee, and the Employee is
willing to accept employment by the Company, on the terms and conditions set forth below.
NOW THEREFORE, in consideration of the premises and the mutual covenants and conditions
herein, the Company and the Employee agree as follows:
1. Employment. The Company agrees to employ the Employee, and the Employee agrees to
accept employment with the Company, on the terms and conditions stated herein.
2. Position and Responsibilities. During the Term, the Employee shall serve as
Director of Maintenance, reporting directly to the Executive Vice President, Operations. The
Employee shall be based in Sacramento, at the Corporate Office, and shall be responsible for the
Corporate Maintenance program. The Employee shall perform other such duties and responsibilities
as the President or the Board of Directors (the “Board”) of the Company may reasonably assign to
the Employee from time to time. The Employee shall devote such time and attention to his duties as
are necessary to the proper discharge of his responsibilities hereunder. The Employee agrees to
perform all duties consistent with: (a) policies established from time to time by the Company; and
(b) all applicable legal requirements.
3. Term. The period of the Employee’s employment under this Agreement (the
“Term”) shall commence on the Effective Date and continue until the second anniversary,
unless terminated earlier as provided herein or extended by the Board. At the end of the initial
Term, this Agreement shall be renewed automatically for successive Terms of one (1) year, unless
either party shall have given the other notice of termination hereof as provided herein.
4. Compensation. Benefits and Reimbursement of Expenses.
A. Compensation. The Company shall compensate the Employee during the Term of this
Agreement as follows:
(1) Base Salary. The Employee shall be paid a base salary (“Base Salary”) of not less
than Eighty-two Thousand Five Hundred Dollars ($82,500) per year in installments consistent with
the Company’s usual practices. The Board shall review the Employee’s Base Salary on each
anniversary of the Effective Date or more frequently, at the times prescribed in salary
administration practices applied generally to management employees of the Company.
(2) Performance Bonus. The Employee shall be entitled to an annual cash bonus (the
“Bonus”) based on the Company’s attainment of reasonable financial objectives to be determined
annually by the Board. The maximum annual bonus will equal twenty-five
percent (25%) of the applicable year’s ending Base Salary and will be payable if the Board
determines, in its sole and exclusive discretion, that that year’s financial objectives have been
fully met. The Bonus shall be paid in accordance with the Company’s bonus plan, as approved by the
Board; provided, however, that in no case shall any portion of the Bonus with respect to any fiscal
year be paid more than seventy-five (75) days after the end of such fiscal year.
(3) Grant of Options. On the Effective Date, the Company shall grant to the Employee,
for no additional consideration, nonqualified stock options (“the Options”) to purchase ten
thousand (10,000) shares of the Company’s Common Stock under the Company’s Amended and Restated
1997 Stock Option Plan. The Options shall have a term of ten (10) years from the date of such
grant and shall be exercisable at a price equal to the closing price of the Company’s stock on the
Nasdaq on the effective date of this agreement. The Options shall vest and become exercisable with
respect to one-third (1/3) of the shares on each of the first and second anniversaries of the
Effective date, with respect to one-third (1/3) of the shares on the third anniversary of the
Effective Date.
The terms of the Options shall be described in more detail in a Stock Option Agreement to be
entered into between the Employee and the Company. If at any time while any of the Options are
still outstanding the Company amends its Stock Option Plan to provide for a less favorable vesting
schedule for stock options than that provided herein, any Options then outstanding shall thereupon
be converted to warrants entitling the Employee to purchase the number of shares of Common Stock
for which the Employee’s then outstanding Options may be exercised, on the same terms as provided
under such Options.
B. Other Benefits. During the Term, the Company shall provide the Employee with a
cellular telephone and will pay or reimburse the Employee’s monthly service fee and costs of calls
attributable to Company business. The Company will also provide the Employee with a laptop
computer for Company use during the Term. This computer will be shipped to the Employee as soon as
this Agreement takes effect. During the Term, the Employee shall be entitled to receive all other
benefits of employment generally available to other management employees of the Company and those
benefits for which management employees are or shall become eligible, including, without limitation
and to the extent made available by the Company, medical, dental, disability and prescription
coverage, life insurance and tax-qualified retirement benefits. If the Employee is not eligible
for coverage under the Company’s health insurance policy at the commencement of the Term, the
Company shall reimburse the Employee for the expenses of health insurance coverage under COBRA from
the commencement of the Term until the Employee becomes eligible for the health insurance benefits
offered by the Company. The Employee shall be entitled to two (2) weeks of paid vacation during
each of the first two (2) twelve-month periods of his employment, and three (3) weeks per
twelve-month period beginning with the third twelve-month period of employment.
C. Relocation Benefits. The Company will provide the following relocation benefits:
(i) the Employee’s temporary lodging and commuting expenses between Austin and Sacramento for a
period of (ninety) 90 days; (ii) expenses of moving the Employee’s household goods from the
Employee’s home in Austin to the Employee’s new home in the Sacramento area when the Employee
relocates to the Sacramento area (including moving insurance, packing and transportation and
temporary storage costs) by a national moving company selected by the
Company; and (iii) reasonable realtor’s fees (or, if the Employee sells his home without the
services of a realtor, an amount equal to the reasonable realtor’s fees that would have been
incurred on such sale) and non-recurring closing costs incurred by the Employee with respect to the
purchase of a home in the Sacramento area. If the Employee voluntarily terminates his employment
within two (2) years after the Effective Date, the Employee shall on such termination pay the
Company an amount equal to the aggregate amount of such benefits, multiplied by a fraction, the
numerator of which is 24 minus the number of full months the Employee was employed by the Company,
and the denominator of which is 24.
If any benefits described in this Section 4(c) are not tax-deductible by the Company, the
Company shall treat the cost of such benefits as additional compensation to the Employee
(“Relocation Compensation”) and shall pay the Employee an additional cash bonus (“Relocation
Bonus”) sufficient to cover any Federal, state or local income or employment taxes on such
Relocation Bonus, so that the Employee shall incur no net after-tax expense as a result of any
benefits paid pursuant to this Section 4(c).
D. Reimbursement of Other Expenses. The Company agrees to pay or reimburse the
Employee for all reasonable travel and other expenses incurred by the Employee in connection with
the performance of his duties under this Agreement on presentation of proper expense statements or
vouchers. All such supporting information shall comply with all applicable Company policies
relating to reimbursement for travel and other expenses. The Company will also assist the Employee
in locating a used vehicle within the company fleet or from an outside vendor for the Employee to
purchase. The payment for this vehicle will either be made upon purchase or through payroll
deductions. The repayment may also be arranged for in a lump sum. In addition, the Company will
satisfy the Employee’s outstanding loan to the Employee’s current employer. This will be in the
form of a loan to the Employee secured by the Warrants and Options issued to the Employee by the
Company. The documents executed for this loan will contain a repayment provision. The repayment
provision will be mutually agreed upon between the parties.
E. Withholding. All compensation payable to the Employee hereunder is subject to all
withholding requirements under applicable law.
5. Confidentiality. During the Term of his employment, and at all times thereafter,
the Employee shall not, without the prior written consent of the Company, divulge to any third
party or use for his own benefit or the benefit of any third party or for any purpose other than
the exclusive benefit of the Company, any confidential or proprietary business or technical
information revealed, obtained or developed in the course of his employment with the Company and
which is otherwise the property of the Company or any of its affiliated corporations, including,
but not limited to, trade secrets, customer lists, formulae and processes of manufacture; provided,
however, that nothing herein contained shall restrict the Employee’s ability to make such
disclosures during the course of his employment as may be necessary or appropriate to the effective
and efficient discharge of his duties to the Company.
6. Property. Both during the Term of his employment and thereafter, the Employee
shall not remove from the Company’s offices or premises any Company documents, records, notebooks,
files, correspondence, reports, memoranda and similar materials or property of any
kind unless necessary in accordance with the duties and responsibilities of his employment.
In the event that any such material or property is removed, it shall be returned to its proper file
or place of safekeeping as promptly as possible. The Employee shall not make, retain, remove, or
distribute any copies, or divulge to any third person the nature or contents of any of the
foregoing or of any other oral or written information to which he may have access, except as
disclosure shall be necessary in the performance of his assigned duties. On the termination of his
employment with the Company, the Employees shall leave with or return to the Company all originals
and copies of the foregoing then in his possession or subject to his control, whether prepared by
the Employee or by others.
7. Termination.
A. Termination by the Company for Cause or by the Employee. The employment of the
Employee may be terminated for Cause at any time by the Board, on written Notice of Termination (as
defined in Section 8.A) delivered to the Employee describing with specificity the grounds for
termination. The employment of the Employee may also be terminated at any time by the Employee on
Written Notice of Termination delivered to the Company. Immediately on termination pursuant to
this Section 7.A., the Company shall pay the Employee in a lump sum his then current Base Salary
under Section 4.A(1) on a prorated basis to the Date of Termination (as defined in Section 8.B. On
termination pursuant to this Section 7.A, the Employee shall forfeit: (i) his Bonus under Section
4.A(2) for the year in which such termination occurs; and (ii) all outstanding but unvested Options
and other options and rights relating to capital stock of the Company. For purposes of this
Agreement, Cause shall mean:
(1) a material breach of any of the terms of this Agreement that is not immediately corrected
following written notice of default specifying such breach;
(2) a breach of any of the provisions of Section 10;
(3) repeated intoxication with alcohol or drugs while on Company premises during its regular
business hours to such a degree that, in the reasonable judgement of the other managers of the
Company, the Employee is abusive or incapable of performing his duties and responsibilities under
this Agreement;
(4) conviction of a felony; or
(5) misappropriation of property belonging to the Company and/or any of its affiliates.
B. Termination Without Cause. The employment of the Employee may be terminated
without Cause at any time by the Board on delivery to the Employee of a written Notice of
Termination (as defined in Section 8.A). On the Date of Termination (as defined in Section 8.B)
pursuant to this Section 7.B, the Company shall pay to the Employee in a lump sum an amount equal
to one (1) year’s Base Salary at the rate in effect on the Date of Termination. The Employee may
elect to forfeit receipt of all or part of the lump sum described in the preceding sentence, in
exchange for payment by the Company of all or part of the costs of the Employee’s relocating to an
area of his choice, with the amount of the lump sum payment forfeited by the Employee and the
amount of the relocation costs paid by the Company to be
determined by agreement between the Employee and the Company. In addition, on termination of
the Employee under this Section 7.B, all of the Employee’s outstanding but unvested Options and
other options and rights relating to capital stock of the Company shall immediately vest and become
exercisable.
C. Termination on Disability. If during the Term the Employee should fail to perform
his duties hereunder on account of physical or mental illness or other incapacity which the Board
shall in good faith determine renders the Employee incapable of performing his duties hereunder,
and such illness or other incapacity shall continue for a period of more than six (6) consecutive
months (“Disability”), the Company shall have the right, on written notice of Termination (as
defined in Section 8.A) delivered to the Employee to terminate the Employee’s employment under this
Agreement. During the period that the Employee shall have been incapacitated due to physical or
mental illness, the Employee shall continue to receive the full Base Salary provided for in Section
4.A(1) hereof at the rate then in effect until the Date of Termination (as defined in Section 8.B)
pursuant to this Section 7.C. On the Date of Termination pursuant to this Section 7.C, all of the
Employee’s outstanding but unvested Options and other options and rights relating to capital stock
of the Company shall immediately vest and become exercisable.
D. Termination on Death. If the Employee shall die during the Term, the employment of
the Employee shall thereupon terminate. On the Date of Termination, (as defined in Section 8.B)
pursuant to this Section 7.D, all of the Employee’s outstanding but unvested Options and other
options and rights relating to capital stock of the Company shall immediately vest and become
exercisable. The term of any such options and rights shall be extended to the third anniversary of
the Employee’s termination. The provisions of this Section 7.D shall not affect the entitlements
of the Employee’s heirs, executors, administrators, legatees, beneficiaries or assigns under any
employee benefit plan, fund or program of the Company.
8. Provisions Applicable to Termination of Employment.
A. Notice of Termination. Any purported termination of Employee’s employment by the
Company or by the Employee pursuant to Section 7 shall be communicated by Notice of Termination to
the Employee or the Company, as the case may be, as provided herein (“Notice of Termination”).
B. Date of Termination. For all purposes, “Date of Termination” shall mean the date
on which a Notice of Termination is given.
C. Benefits on Termination. On termination of this Agreement pursuant to Section 7,
all profit-sharing, deferred compensation and other retirement benefits payable to the Employee
under benefit plans in which the Employee then participated in shall be paid to the Employee in
accordance with the provisions of the respective plans. Except as otherwise provided in Sections
7.B, 7.C, 7.D and 9, if the Employee’s employment by the Company is terminated before all of the
Employee’s options, warrants and rights with respect to the Company’s capital stock have vested,
the Employee shall forfeit any such options, warrants and rights that are unvested as of the
termination date.
9. Change in Control.
A. Payments on Change in Control. Notwithstanding any provision in this Agreement to
the contrary, unless the Employee elects in writing to waive this provision, a Change in Control
(as defined below) of the Company shall be deemed a termination of the Employee without Cause, and
the Employee shall be entitled to receive and the Company agrees to pay to the Employee in a lump
sum the same amount determined under Section 7.B that is payable to the Employee on Termination
without Cause, and the Employee shall have the right to forfeit all or part of such amount in
exchange for payment by the Company of certain relocation costs, as described in Section 7.B. In
addition, on a Change of Control, all of the Employee’s outstanding but unvested Options and other
options and rights relating to capital stock of the Company shall immediately vest and become
exercisable.
After a Change in Control, if any previously outstanding Option or other option or right (the
“Terminated Option”) relating to the Company’s capital stock does not remain outstanding, the
successor to the Company or its then Parent (as defined below) shall either:
(1) Issue an option, warrant or right, as appropriate (the “Successor Option”), to purchase
common stock of such successor or Parent in an amount such that on exercise of the Successor Option
the Employee would receive the same number of shares of the successor’s/Parent’s common stock as
the Employee would have received had the Employee exercised the Terminated Option immediately prior
to the transaction resulting in the Change in Control and received shares of such successor/Parent
in such transaction. The aggregate exercise price for all of the shares covered by such Successor
Option shall equal the aggregate exercise price of the Terminated Option; or
(2) Pay the Employee a bonus within ten (10) days after the consummation of the Change in
Control in an amount agreed to by the Employee and the Company. Such amount shall be at least
equivalent on an after-tax basis to the net after-tax gain that the Employee would have realized if
he had been issued a Successor Option under clause (i) above and had immediately exercised such
Successor Option and sold the underlying stock, taking into account the different tax rates that
apply to such bonus and to such gain, and such amount shall also reflect other differences to the
Employee between receiving a bonus under this clause (ii) and receiving a Successor Option under
clause (i) above.
B. Definitions. For the purposes of this Agreement, a Change in Control shall be
deemed to have occurred if: (i) there shall be consummated (aa) any reorganization, liquidation or
consolidation of the Company, or any merger or other business combination of the Company with any
other corporation, other than any such merger or other combination that would result in the voting
securities of the Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the surviving entity) at
least fifty percent (50%) of the total voting power represented by the voting securities of the
Company or such surviving entity outstanding immediately after such transaction, (bb) any sale,
lease, exchange, or other transfer (in one transaction or a series of related transactions) of all,
or substantially all, of the assets of the Company; or if (ii) any “person” (as defined in Section
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), shall
become the “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of fifty percent
(50%) or more of the Company’s outstanding voting securities (except that for purposes of this
Section 10.B, “person” shall not include any person or any persons that controls, is controlled by
or is under common control with such person, who as of the date of this Agreement owns ten percent
(10%) or more of the total voting power represented by the outstanding voting securities of the
Company, or a trustee or other fiduciary holding securities under any employee benefit plan of the
Company, or a corporation that is owned directly or indirectly by the stockholders of the Company
in substantially the same percentage as their ownership of the Company); or if (iii) during any
period of two (2) consecutive years, individuals who at the beginning of such period constituted
the entire Board shall cease for any reason to constitute at least one-half of the membership
thereof unless the election, or the nomination for election by the Company’s shareholders, of each
new director was approved by a vote of at least one-half (1/2) of the directors then still in
office who were directors at the beginning of the period.
The term “Parent” means a corporation, partnership, trust, limited liability company or other
entity that is the ultimate “beneficial owner” (as defined above) of fifty percent (50%) or more of
the Company’s outstanding voting securities.
10. Non-Competition and Non-Solicitation.
A. In consideration of the provisions hereof, for the period commencing on the date hereof and
ending on the first anniversary of the termination of this Agreement, the Employee will not, except
as specifically provided below, anywhere in any county in any state in which the Company is engaged
in business as of such termination date, directly or indirectly, acting individually or as the
owner, shareholder, partner or management employee of any entity: (i) engage in the operation of a
solid waste collection, transporting or disposal business, transfer facility, recycling facility,
materials recovery facility or solid waste landfill; (ii) enter the employ as a manager of, or
render any personal services to or for the benefit of, or assist in or facilitate the solicitation
of customers for, or receive remuneration in the form of management salary, commissions or
otherwise from, any business engaged in such activities in such counties; or (iii) receive or
purchase a financial interest in, making a loan to, or making a gift in support of, any such
business in any capacity, including without limitation, as a sole proprietor, partner, shareholder,
officer, director, principal agent or trustee; provided, however, that the Employee may own,
directly or indirectly, solely as an investment, securities of any business traded on any national
securities exchange or quoted on any NASDAQ market, provided the Employee is not a controlling
person of, or a member of a group which controls, such business and further provided that the
Employee does not, in the aggregate, directly or indirectly, own two percent (2%) or more of any
class of securities of such business.
B. After termination of this Agreement, the Employee shall not: (i) solicit any residential
or commercial customer of the Company to whom the Company provides service pursuant to a franchise
agreement with a public entity in any county in any state in which the Company is engaged in
business as of such termination date; (ii) solicit any residential or commercial customer of the
Company to enter into a solid waste collection account relationship with a competitor of the
Company in any such county; (iii) solicit any such public entity to enter into a franchise
agreement with any such competitor; (iv) solicit any officer, employee or contractor of
the Company to enter into an employment or contractor agreement with a
competitor of the Company or otherwise interfere in any such relationship; or (v) solicit on
behalf of a competitor of the Company any prospective customer of the Company that the Employee
called on or was involved in soliciting on behalf of the Company during the Term, in each case
until the second anniversary of the date of such termination, unless otherwise permitted to do so
by Section 10.A; provided, however, that if the Employee is terminated by the Company without Cause
by the company pursuant to Section 7.B, the restrictions in this Section 10(b) shall apply only for
as many months after such termination as are used to calculate the amount actually paid under
Section 10.B(3) to the Employee on such termination. For example, if the Employee waives his right
to be paid any amount under Section 7.B(3) (relating to the Total Compensation paid to him during
the previous twelve months), the restrictions in this Section 10.B shall not apply at all; if the
Employee elects to receive under Section 7.B(3) an amount equal to only eight (8) months’ Total
Compensation, the restrictions shall apply for only eight (8) months.
C. If the final judgment of a court of competent jurisdiction declares that any term or
provision of this Section 10 is invalid or unenforceable, the parties agree that the court making
the determination of invalidity or unenforceability shall have the power to reduce the scope,
duration or area of the term or provision, to delete specified words or phrases or to replace any
invalid or unenforceable term or provision within a term or provision that is valid or enforceable
and that comes closest to expressing the intention of the invalid or unenforceable term or
provision, and this Agreement shall be enforceable as so modified after the expiration of the time
within which the judgment may be appealed.
11. Indemnification. As an employee and agent of the Company, the Employee shall be
fully indemnified by the Company to the fullest extent permitted by applicable law in connection
with his employment hereunder.
12. Survival of Provisions. The obligations of the Company under Section 11 of this
Agreement, and of the Employee under Sections 5, 6 and 10 of this Agreement, shall survive both the
termination of the Employee’s employment and this Agreement.
13. No Duty to Mitigate: No Offset. The Employee shall not be required to mitigate
damages or the amount of any payment contemplated by this Agreement, nor shall any such payment be
reduced by any earnings that the Employee may receive from any other sources or offset against any
other payments made to him or required to be made to him pursuant to this Agreement.
14. Assignment: Binding Agreement. The Company may assign this Agreement to any
parent, subsidiary, affiliate or successor of the Company. This agreement is not assignable by the
Employee and is binding on him and his executors and other legal representatives. This agreement
shall bind the Company and its successors and assigns and inure to the benefit of the Employee and
his heirs, executors, administrators, personal representatives, legatees or devisees. The Company
shall assign this Agreement to any entity that acquires its assets or business.
15. Notice. Any written notice under this Agreement shall be personally delivered to
the other party or sent by certified or registered mail, return receipt requested and postage
prepaid, to such party at the address set forth in the records of the Company or to such other
address as either party may from time to time specify by written notice.
16. Entire Agreement: Amendments. This Agreement contains the entire agreement of the
parties relating to the Employee’s employment and supersedes all oral or written prior discussions,
agreements and understandings of every nature between them. This Agreement may not be changed
except by an agreement in writing signed by the Company and the Employee.
17. Waiver. The waiver of a breach of any provision of this Agreement shall not
operate or as be construed to be a waiver of any other provision or subsequent breach of this
Agreement.
18. Governing Law and Jurisdictional Agreement. This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State of California.
19. Severability. In case one or more of the provisions contained in this Agreement
is, for any reason, held invalid in any respect, such invalidity shall not affect the validity of
any other provision of this Agreement, and such provision shall be deemed modified to the extent
necessary to make it enforceable.
20. Enforcement. It is agreed that it is impossible to measure fully, in money, the
damage which will accrue to the Company in the event of a breach or threatened breach of Sections
5, 6, or 10 of this Agreement, and, in any action or proceeding to enforce the provisions of
Sections 5, 6 or 10 hereof, the Employee waives the claim or defense that the Company has an
adequate remedy at law and will not assert the claim or defense that such a remedy at law exists.
The Company is entitled to injunctive relief to enforce the provisions of such sections as well as
any and all other remedies available to it at law or in equity without the posting of any bond.
The Employee agrees that if the Employee breaches any provision of Section 10, the Company may
recover as partial damages all profits realized by the Employee at any time prior to such recovery
on the exercise of any warrant, option, or right to purchase the Company’s Common Stock and the
subsequent sale of such stock, and may also cancel all outstanding such warrants, options and
rights.
21. Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed an original and both of which together shall constitute one and the same instrument.
22. Due Authorization. The execution of this Agreement has been duly authorized by
the Company by all necessary corporate action.
IN WITNESS WHEREOF, the parties have executed and delivered this Employment Agreement as of
the day and year set forth above.
| WASTE CONNECTIONS, INC., | ||||
| A Delaware corporation | ||||
By:
|
/s/ Xxxxxx X. Xxxxxxxxxxxx
|
|||
| Printed Name: Xxxxxx X. Xxxxxxxxxxxx | ||||
| Title: President | ||||
| EMPLOYEE: | ||||
| /s/ Xxxx Xxxxxxxxxx | ||||
| Xxxx Xxxxxxxxxx | ||||
