EMPLOYMENT AGREEMENT
Exhibit 10.4
Republic Services, Inc.
(the “Company”) and Xxxxx Xxxxxxxxx (“Employee”) enter into this Employment
Agreement (“Agreement”), which will become effective as of the effective date of the merger
involving the Company and Allied Waste Industries, Inc. (the “Effective Date”). This Agreement
outlines the terms and conditions under which the Company will employ Employee. The Company and
Employee will be referred to as the “Parties” in this Agreement. The Parties agree as follows:
1. General Duties of Company and Employee. The Company will employ Employee as Senior Vice
President, Midwestern Operations. Employee’s duties and responsibilities will be those assigned by
Employee’s supervisor or such other officer(s) as the Company may designate. Employee will devote
all working time and attention to the Company’s business and use Employee’s best efforts to
satisfactorily perform his duties and responsibilities. Employee owes a fiduciary duty of loyalty,
fidelity and allegiance to always act in the Company’s best interests and to refrain from doing or
saying anything that injures the Company. Employee will comply with all Company policies, rules and
guidelines. As consideration for Employee’s employment and the compensation and benefits payable
hereunder, Employee agrees to sign the Company’s non-competition, non-solicitation and
confidentiality agreement required for Employee’s position (and any amendments that may be
necessary from time to time). Such agreement is attached to this Agreement as Appendix A and
becomes effective on the Effective Date of this Agreement.
2. Employment Period. Employee’s employment is at-will and therefore can be terminated, at any
time, with or without cause or notice, by either Employee or the Company. The termination of
employment by either Employee or the Company will not affect Employee’s then existing
non-competition, non-solicitation and confidentiality obligations.
3. Compensation and Benefits.
3.1 Base Salary and Bonus. The Company will pay to Employee an annual base salary as set forth in
the term sheet attached to this Agreement as Appendix B. Such salary will be payable in accordance
with the Company’s practice at the time and subject to periodic review or adjustment by the
Company. The Company also may elect, in its sole discretion, to pay Employee a bonus (which may be
made pursuant to a Company incentive plan or program or otherwise) in an amount to be determined in
the Company’s sole discretion.
3.2 Incentive, Savings, Welfare, Retirement and Equity Plans. Employee will be entitled to
participate in, and be eligible to receive, benefits available to similarly situated employees
under Company incentive, savings, welfare, retirement and equity plans and programs, as those
currently exist or may be modified by the Company (“Compensation Plans”). Employee’s participation
in all such Compensation Plans will be governed by the terms and provisions of each Compensation
Plan. Nothing in this Agreement shall prohibit or limit the right of the Company to discontinue,
modify, or amend any plan or benefit in its sole discretion at any time, provided such
discontinuance, modification, or amendment is applied generally to similarly situated employees of
the Company.
4. Termination of Employment.
4.1 Termination by Company for Cause. The Company may terminate Employee’s
employment for Cause. If such termination occurs, Employee will be entitled to only the payments
and benefits provided in Section 5.1. “Cause” means: (a) Employee is convicted of or
pleads guilty (or nolo contendre) to a felony or other crime involving moral turpitude; (b) the
Company determines that Employee knowingly breached any term of this Agreement; (c) the Company
determines that Employee knowingly violated any of the Company’s policies, rules or guidelines; or
(d) the Company determines that Employee willfully engaged in conduct, or willfully failed to
perform assigned duties, the result of which exposes the Company to serious actual or potential
injury (financial or otherwise).
4.2 Termination Without Cause. The Company may terminate Employee’s employment Without
Cause. If such termination occurs, Employee will be entitled to only the payments and benefits
provided for in Section 5.2; provided, however, if such termination Without Cause occurs within one
year after a Change in Control (as defined in Section 5.4 below), then the Employee will be
entitled to only those payments and benefits provided for in Section 5.3. A termination
“Without Cause” means a termination of Employee’s employment by the Company other than
for Cause or because of a disability or death.
4.3 Termination by Employee. Employee may terminate the employment relationship for any
reason. In the event of a termination by Employee for any reason, Employee will be entitled to only
the payments and benefits provided for in Section 5.1; provided, however, if Employee terminates
for “Good Reason” (as defined in Section 5.4 below) within one year after a Change in Control, then
the Employee will be entitled to those payments and benefits provided for in Section 5.3.
5. Obligations of Company Upon Termination.
5.1 Terminations Other than Without Cause. If the Employee’s employment with the
Company terminates for any reason other than Without Cause, the Company will pay Employee within
ten (10) days after the termination date all earned but unpaid compensation for time worked through
the termination date.
5.2 Without Cause by the Company. If the Company terminates Employee’s employment
Without Cause (and it constitutes a separation from service under Section 409A of the Internal
Revenue Code and accompanying Treasury Regulations (“Section 409A”)):
(a) The Company will pay Employee:
(1) all earned but unpaid compensation for the time Employee worked through the termination date,
to be paid within ten (10) days after the termination date;
(2) an amount equal to one year of Employee’s then current base salary in equal bi-weekly
installments over a twelve (12) month period beginning on the bi-weekly payroll date following the
sixtieth (60th) day after the termination date;
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(3) an amount equal to a prorated annual bonus. The amount of the prorated annual bonus will equal
the amount of the annual bonus, if any, to which Employee would have been entitled if Employee was
employed by the Company on the last day of the year that includes the termination date multiplied
by a fraction equal to the number of days which have elapsed in such year through the termination
date divided by 365. Such amount, if any, will be paid at the same time as bonuses are paid to
current similarly situated employees of the Company.
(b) Employee’s stock options and other equity awards granted after the Effective Date that remain
outstanding as of the termination date, will continue to vest and be exercisable as if Employee was
employed during the one-year period following the termination date (or, if less, the remainder of
the original term of the award);
(c) If Employee and/or Employee’s spouse and dependents are enrolled in the Company’s medical,
dental and/or vision plan as of the termination date, the Employee and/or Employee’s spouse and
dependents shall continue to participate in those plans (whichever applicable), at the same cost
applicable to active employees, until the earliest of: (i) the date Employee becomes eligible for
any comparable medical, dental, or vision coverage provided by another employer, (ii) the date
Employee becomes eligible for Medicare or any similar government-sponsored or provided health care
program, or (iii) the first anniversary of the termination date; and
(d) The payments and benefits provided under Section 5.2 will be instead of any payments or
benefits to which Employee may be entitled under the terms of any severance plan or program of the
Company in effect on the termination date.
5.3 Change in Control. If the Company terminates Employee’s employment Without Cause or
if Employee resigns for “Good Reason” within one (1) year after the effective date of a Change in
Control (and it constitutes a separation from service under Section 409A), Employee will be
entitled to the following payments and benefits:
(a) The Company will pay Employee:
(1) all earned but unpaid compensation for the time Employee worked through the termination date,
to be paid within ten (10) days after the termination date;
(2) (i) if the Change in Control constitutes a change in the ownership or effective control of the
Company or a change in the ownership of a substantial portion of the assets of the Company as
defined under Treasury Regulations Section 1.409A-3(i)(5), as may be amended (a “Section
409A Change in Control”), then on the bi-weekly payroll date following the sixtieth (60th) day
after the termination date, a lump sum amount equal to: (x) two years of Employee’s then current
base salary,
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and (y) two times the Employee’s target annual bonus, if any, for the year in
which the termination date occurs; and (ii) if the Change in Control does not constitute a Section
409A Change in Control, then (x) an amount equal to two years of Employee’s then current base
salary in equal biweekly installments over a twenty-four month period beginning on the biweekly
payroll date following the sixtieth (60th) day after the termination date, and (y) a lump sum
payment equal to two times the Employee’s target annual bonus, if any, for the year in which the
termination date occurs payable on the bi-weekly payroll date following the sixtieth (60th) day
after the termination date;
(b) Employee’s stock options and other equity awards granted after the Effective Date that remain
outstanding as of the termination date, will become 100% fully vested and exercisable on the
termination date and remain exercisable for one (1) year following the termination date, but not
beyond the original term of the option or other awards;
(c) If Employee and/or Employee’s spouse and dependents are enrolled in the Company’s medical,
dental and/or vision plan as of the termination date, the Employee and/or Employee’s spouse and
dependents shall continue to participate in those plans (whichever applicable), at the same cost
applicable to active employees, until the earliest of: (i) the date Employee becomes eligible for
any comparable medical, dental, or vision coverage provided by another employer, (ii) the date
Employee becomes eligible for Medicare or any similar government-sponsored or provided health care
program, or (iii) the first anniversary of the termination date;
(d) All long term incentive grants, if any, provided to Employee shall immediately vest as if all
targets and conditions had been met and shall be paid by the Company to the Employee at such time
as the Company would have been required to make such payments if the termination of employment had
not occurred; and
(e) The payments and benefits provided under Section 5.3 will be instead of any payments or
benefits to which Employee may be entitled under the terms of any severance plan or program of the
Company in effect on the termination date.
5.4 Change in Control and Good Reason Definitions. For purposes of this Agreement, Change in
Control has the meaning set forth on Appendix C. Good Reason is defined as a
reduction in Employee’s base salary, bonus opportunity, or title and applies only during the
one-year period following the effective date of a Change in Control.
5.5 Release of Claims. The Company’s obligations under Section 5 (except Sections 5.2(a)(1) and
5.3(a)(1)) are contingent upon Employee executing (and not revoking during any applicable
revocation period) a valid, enforceable, full and unconditional release of all claims Employee may
have against the Company (whether known or unknown) as of the termination date in such form as
provided by the Company. Additionally, the Company’s obligations under those Sections will cease immediately if the Company determines that Employee has
violated at
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any time any of Employee’s non-compete, non-solicitation or confidentiality
obligations to the Company.
5.6 Section 409A. Notwithstanding any provisions in this Agreement to the contrary, if
at the time of the employment termination the Employee is a “specified employee” as defined in
Section 409A and the deferral of the commencement of any payments or benefits otherwise payable as
a result of such employment termination is necessary to avoid the additional tax under Section
409A, the Company will defer the payment or commencement of the payment of any such payments or
benefits (without any reduction in such payments or benefits ultimately paid or provided to the
Employee) until the date that is six (6) months following the employment termination. Any monthly
payment amounts deferred will be accumulated and paid to the Employee (without interest) six (6)
months after the termination of employment in a lump sum, and the balance of payments due to the
Employee will be paid as otherwise provided in this Agreement. Each bi-weekly payment described in
Sections 5.2(a)(2) and 5.3(a)(2) is designated as a “separate payment” for purposes of Section
409A. This Agreement will be interpreted, administered and operated in accordance with Section
409A, although nothing herein will be construed as an entitlement to or guarantee of any particular
tax treatment to the Employee.
6. Employee’s Obligation to Avoid Conflicts of Interest. Employee agrees to abide by
the Company’s Conflicts of Interest policy, which includes not becoming involved, directly or
indirectly, in a situation that a reasonable person would recognize to be an actual conflict of
interest with the Company. If Employee discovers, or is informed by the Company that Employee has
become involved in a situation that is an actual or likely conflict of interest with the Company,
Employee will take immediate actions to eliminate the conflict and will not allow the conflict to
continue. The Company’s determination as to whether or not a conflict of interest exists will be
conclusive.
7. Non-Disparagement. Employee agrees that at no time during Employee’s employment or
after Employee’s termination date, except as permitted or required by applicable law, will Employee
directly or indirectly: (a) disparage or say or write negative things about the Company, its
officers, directors, agents, or employees; (b) initiate or participate in any discussion or
communication that reflects negatively on the Company, its officers, directors, agents, or
employees; or (c) engage in any other activity that the Company considers detrimental to its
interests. For purposes of this Section 7, a disparaging or negative statement is any
communication, oral or written, which would tend to cause the recipient of the communication to
question the business condition, integrity, competence, fairness, or good character of the person
or entity to whom the communication relates.
8. Cooperation and Assistance. Employee agrees that, after the termination date,
Employee will assist and cooperate with the Company concerning business or legal related matters
about which Employee possesses relevant knowledge or information. Such cooperation will be provided
only at the Company’s specific request and will include, but not be limited to, assisting or
advising the Company with respect to any business-related matters or any actual or threatened legal
action (including testifying in depositions, hearings, and/or trials). In addition, Employee agrees
to promptly inform the Company (by telephonic or written communication to Republic Services, Inc.,
Legal Department, 00000 Xxxxx Xxxxxx Xxx, Xxxxxxx, XX 00000, phone number 000-000-0000) if any
person or business contacts Employee in an effort to obtain information about the Company.
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9. Miscellaneous.
9.1 Waiver of Breach. The waiver by any Party of a breach of any provision of this
Agreement will neither operate nor be construed as a waiver of any subsequent breach.
9.2 Notice. All notices and other communications required or permitted under this
Agreement will be in writing and will be deemed to have been given when delivered by hand or mailed
by registered or certified mail, return receipt requested, as follows:
| If to the Company: | Republic Services, Inc. | |||
| 00000 Xxxxx Xxxxxx Xxx | ||||
| Xxxxxxx, Xxxxxxx 00000 | ||||
| ATTN: General Counsel | ||||
| If to the Employee: | 0 Xxxxxxx Xxxxx | |||
| Xxxxxxxxx, XX 00000 |
or to such other names or addresses as the Company or Employee, as the case may be, will designate
by notice to the other party under this Section 9.2.
9.3 Assignment. The Company may assign this Agreement upon written notice to
Employee. However, Employee agrees that Employee’s rights and obligations under this Agreement are
personal to Employee and may not be assigned, except to Employee’s estate, without the express
written consent of the Company.
9.4 Entire Agreement, No Oral Amendments. This Agreement replaces all previous
agreements and discussions relating to any employment relationship between Employee and the Company
or any of its subsidiaries or affiliated entities
and constitutes the entire agreement between Employee and the Company with respect to the matters
addressed in this Agreement. This Agreement may not be modified in any respect except by a written
agreement signed by an executive officer of the Company. Employee acknowledges that upon the
Effective Date of this Agreement it replaces Employee’s prior agreement with Allied Waste or the
Company or any of its subsidiaries and that Employee is not entitled to any compensation or
benefits that may have been provided under such agreement.
9.5 Enforceability. If a court or arbitrator authorized by this Agreement to resolve
disputes between the Parties determines that any provision of this Agreement is invalid or
unenforceable, the invalid or unenforceable provision will be struck from this Agreement without
affecting any other provision of this Agreement. All remaining provisions of this Agreement that
were not struck will be enforced according to their terms.
9.6 Governing Law, Jurisdiction, and Venue. This Agreement and the rights and
obligations of the Parties hereunder shall be governed and interpreted in accordance with the laws
of the State of Arizona. Additionally, the parties agree that the courts situated in Maricopa
County, Arizona will have personal jurisdiction over them to hear all disputes arising under, or
related to, this Agreement and that venue will be proper only in a court or arbitral forum in
Maricopa County, Arizona.
9.7 Arbitration. With the sole exception of any breach by Employee of the obligations
Employee assumed under a non-competition, non-solicitation and confidentiality
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agreement (the breach of which permits the Company to obtain judicial relief due to the exigent circumstances
presented by such a breach), all other alleged breaches of this Agreement, or any other dispute
between the Parties arising out of or in connection with Employee’s employment with the Company
will be settled by binding arbitration to the fullest extent permitted by law. This Agreement to
arbitrate applies to any claim for relief of any nature, including but not limited to claims of
wrongful discharge under statutory law and common law; employment discrimination based on federal,
state or local statute, ordinance, or governmental regulations, including discrimination prohibited
by: (a) Title VII of the Civil Rights Act of 1964, as amended, (b) the Age Discrimination in
Employment Act, (c) the Americans with Disabilities Act, (d) the Fair Labor Standards Act; claims
of retaliatory discharge or other acts of retaliation; compensation disputes; tortious conduct;
allegedly contractual violations; ERISA violations; and other statutory and common law claims and
disputes, regardless of whether the statute was enacted or whether the common law doctrine was
recognized at the time this Agreement was signed.
The Parties understand that they are agreeing to substitute one legitimate dispute resolution forum
(arbitration) for another (litigation) because of the mutual advantages this forum offers, and are
waiving their right to have their disputes resolved in court except for breaches by the Employee of
Employee’s non-competition, non-solicitation and confidentiality obligations.
The arbitration proceeding will be conducted in Maricopa County, Arizona in accordance with the
National Rules for the Resolution of Employment Disputes (National Rules) of the American
Arbitration Association (AAA) in effect at the time a demand for arbitration is
made. The Company will pay all costs and expenses of the arbitration, except for the filing fees
and costs that would have been required had the proceeding been initiated and maintained in the
Maricopa County Superior Court, which fees and costs Employee will pay. Each Party will pay their
own attorneys’ fees and expenses throughout the arbitration proceeding. However, the arbitrator may
award the successful Party its attorneys’ fees and expenses at the conclusion of the arbitration
and any other relief provided by law.
| REPUBLIC SERVICES, INC. |
||||
| By: | /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President and Chief Operating Officer | |||
| EMPLOYEE |
||||
| /s/ Xxxxx Xxxxxxxxx | ||||
| Xxxxx Xxxxxxxxx | ||||
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APPENDIX A
NON-COMPETITION, NON-SOLICITATION AND CONFIDENTIALITY AGREEMENT
Republic Services, Inc. (the “Company”) and Xxxxx Xxxxxxxxx (“Employee”) enter into this
Non-Competition, Non-Solicitation and Confidentiality Agreement (“Agreement”). The Parties agree as
follows:
1. Certain Definitions and Understandings. The Parties expect that some or all of the obligations
the Company will assume to Employee under this Agreement will be fulfilled through its parent,
subsidiary, related, or successor companies (“Affiliates”). Accordingly, Employee acknowledges that
the discharge of any obligation of the Company under this Agreement by one or more of its
Affiliates discharges the Company’s obligation in that regard. Moreover, the obligations Employee
will assume under this Agreement will be owed to the Company and its Affiliates (collectively
referred to as the “Company” for the remainder of this Agreement).
2. Consideration Employee Will Receive Under This Agreement. The Parties recognize that in order
for Employee to perform his duties, Employee needs to manage, use or otherwise handle Confidential
Information (as defined below in Section 3.1) belonging to the Company. Thus, the Company agrees to
provide Employee with, and access to, Confidential Information necessary to perform his duties.
Employee agrees that, in exchange for the Company providing him with Confidential Information, the
Company’s agreement to employ him on an at-will basis, and for other valuable consideration
outlined in his Employment Agreement, Employee will make the promises set forth in the following
sections of this Agreement.
3. Employee’s Confidentiality Obligations.
3.1 For purposes of this Agreement, “Confidential Information” is not limited to information that
would qualify as a Trade Secret and includes, but is not limited to: customer lists and agreements;
customer service information; names of customer contacts and the identities of their
decision-makers; routes and/or territories; information provided to the Company by any actual or
potential customer, government agency or other third party; the Company’s internal personnel and
financial information; information about vendors that is not generally known to the public;
purchasing and internal cost information; information about the profitability of particular
operations; internal service and operational manuals and procedures; the manner and methods of
conducting the Company’s business; marketing plans, development plans, price data, cost data, price
and fee amounts, pricing and billing policies, quoting procedures, marketing techniques, forecasts
and forecast assumptions and volumes; future plans and potential acquisition, divestiture and other
development strategies; non-public information about the Company’s landfill development plans,
landfill capacity, special projects, and the status of any permitting process; the status of any
governmental investigation, charge, or lawsuit and the position of the Company regarding the value
of such matter; non-public information regarding the Company’s compliance, with federal,
state or local laws; information that gives the Company some competitive business advantage, or the
opportunity of obtaining such an advantage, or the disclosure of which could be detrimental to the
interests of the Company; and/or information that is not generally known outside the Company.
3.2 As a consequence of Employee’s acquisition of Confidential Information, Employee agrees that it
is reasonable and necessary that he make the following covenants:
(a) At no time while Employee is employed or at any time after his employment ends will Employee
disclose Confidential Information to any person or entity either inside or outside of the Company
other than as necessary in carrying out his duties and responsibilities, nor will Employee use,
copy, or transfer Confidential Information other than as necessary in carrying out his duties and
responsibilities, without first obtaining the Company’s prior written consent. In the event a court
concludes that the temporal restrictions in this Section 3.2(a) are unreasonable, Employee’s
obligations under this Section 3.2(a) will end three (3) years after his employment ends.
(b) During his employment, Employee agrees to promptly disclose to the Company all information,
ideas, concepts, improvements, discoveries and inventions (“Inventions”), which he conceives,
develops, creates, or acquires, either individually or jointly with others, and which relate to the
business, products, or services of the Company, irrespective of whether such Inventions were
conceived, developed, discovered, or acquired by Employee on the job, at home, or elsewhere.
Employee further agrees that all right, title and interest (including copyrights) in and to any
Inventions shall be the property of the Company.
(c) When Employee’s employment with the Company ends, Employee will immediately deliver to the
Company (or its designee) anything containing Confidential Information including, but not limited
to, reports, studies, materials, records, documents, books, files, videotapes, tape recordings,
computers, computer disks, flash/thumb drives, CDs, DVDs, PDAs, Blackberry devices, mobile
telephones, and/or other devices used to store electronic data, including any copies thereof,
whether made by Employee or which came into his possession prior to or during his employment
concerning the business or affairs of the Company.
4. Employee’s Non-Competition and Non-Solicitation Obligations.
4.1 Definitions:
(a) “Principal Competitor” means: (i) Waste Management, Inc., Waste Connections, Inc., or Veolia
Environmental Services North America Corp. (including their predecessors, successors, parents,
subsidiaries, or affiliate operations); or (ii) any public or private business (including their
predecessors, successors, parents, subsidiaries, or affiliate operations) conducting Non-hazardous
Solid Waste Management services in three (3) or more states in which the Company conducts business.
(b) “Competitor” means any public or private business that provides Non-hazardous Solid Waste
Management services in any state in which the Company conducts business.
(c) “Rendering Services” means any of the following activities, whether done directly or through
others, whether done in person or through telephonic, electronic, or some other means of
communication, and whether done as a principal, director, officer, agent, employee, contractor, or
consultant: (i) performing any kind of services or duties related to Non-hazardous Solid Waste
Management; (ii) selling, marketing, managing, or brokering Non-hazardous Solid
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Waste Management
services; (iii) developing, managing, or otherwise handling data or information concerning
potential or actual acquisitions of businesses that engage in Non-hazardous Solid Waste Management;
(iv) participating in any decision, or developing, or implementing any strategy, to acquire such
businesses; (v) formulating, reviewing, or implementing long or short-term marketing, sales, or
operational strategies related to Non-Hazardous Solid Waste Management; (vi) conducting or
reviewing cost benefit analysis on proposed projects related to Non-Hazardous Solid Waste
Management; (vii) conducting, participating in, or otherwise assisting any review of the prices or
rates charged by the Company, whether in connection with an initial contract bid, a contract
extension, or a request for a price/rate increase; (viii) soliciting, requesting, reviewing,
analyzing, or otherwise handling Confidential Information about the costs (including SG&A or
operational), revenues, or profit margins of the Company; (ix) determining, advising, or
recommending whether to award a contract to the Company, or whether, and to what extent, the
Company is entitled to an increase in its rates or prices; and/or (x) performing any functions that
are the same as, or substantially similar to, the duties Employee performed for the Company at any
time during the last twenty-four (24) months of his employment.
(d) “Contact” means any direct or indirect interaction between Employee and any customer, potential
customer, or acquisition prospect, which takes place in an effort to further a business
relationship, whether done directly or through others, whether in person or through telephonic,
electronic, or some other means of communication, and whether done as a principal, director,
officer, agent, employee, contractor, or consultant.
(e) “Non-hazardous Solid Waste Management” means the collection, hauling, disposal, or recycling,
of non-hazardous refuse or other services provided by the Company.
(f) “Facility” means the physical location at which the Company owns, leases, or operates: (i) an
office; (ii) a collection operation; or (iii) a post-collection operation (including, but not
limited to, landfills, transfer stations, material recovery facilities, recycling facilities and
compost facilities).
(g) “Solicit” means soliciting directly or through others, whether done in person or through
telephonic, electronic, or some other means of communication, and whether done as a principal,
director, officer, agent, employee, contractor, or consultant.
4.2 Prohibition Against Competition.
(a) During his employment, and for a period of twenty-four (24) months after his employment ends,
Employee will not compete with the Company to the extent, and subject to the express limitations,
provided in this Section 4.2. In the event a court concludes that twenty-four (24) months is an
unreasonable period of time, Employee’s obligations under this Section 4.2 will end eighteen (18)
months after his employment ends.
(b) During his employment, Employee will have detailed knowledge of, and active participation in,
many issues affecting the Company’s operations across the nation. Much of the Confidential
Information Employee will receive will not be limited to a particular geographic area. Nonetheless,
the Parties recognize that an appropriate non-competition obligation should balance Employee’s
interest in future employment with the Company’s interest in protecting its
3
Confidential Information and other protectable interests. Accordingly, Employee agrees that he will
not Render Services to any Principal Competitor, or to any Competitor, that are: (i) rendered in a
state in which the Company does business; or (ii) directed at achieving, or intended to achieve, a
result in any such state. In the event a court concludes that this particular restriction is not
reasonably limited, Employee will not Render Services to any Principal Competitor, or to any
Competitor, that are: (i) rendered within forty (40) miles of any Facility; or (ii) directed at
achieving, or intended to achieve, a result within forty (40) miles of any Facility.
4.3 Prohibition Against Solicitation.
(a) During his employment, and for a period of twenty-four (24) months after his employment ends,
Employee will limit his activities relating to customers, potential customers, acquisition
prospects, employees, consultants and independent contractors of the Company to the extent, and
subject to the express limitations, provided in this Section 4.3. In the event a court concludes
that twenty-four (24) months is an unreasonable period of time, Employee’s obligations under this
Section 4.3 will end eighteen (18) months after his employment ends.
(b) Employee will not Contact any customers, potential customers, or acquisition prospects of the
Company that Employee generated, serviced, managed, contacted, or maintained at any time during the
last twenty-four (24) months of his employment on behalf of any Principal Competitor, or any
Competitor, that provides Non-hazardous Solid Waste Management services within forty (40) miles of
any Facility.
(c) Employee will not, either directly or indirectly, raid, Solicit, attempt to Solicit, or induce,
any employee of, consultant to, or independent contractor of, the Company to terminate his or her
relationship with the Company in order to become an employee of, consultant to, independent
contractor of, or act in any other way on behalf of, any other person or entity.
4.4 Judicial Modification. If the applicable temporal or geographic limitations agreed to by the
Parties in this Section 4 are found by a court to be overbroad, the Parties expressly authorize the
judge before whom any dispute is brought to impose the broadest temporal and geographic limitations
permissible under the law.
5. Miscellaneous.
5.1 Waiver of Breach. The waiver by any Party of a bleach of any provision of this Agreement will
neither operate nor be construed as a waiver of any subsequent breach.
5.2 Assignment. The Company may assign this Agreement upon written notice to Employee.
However, Employee agrees that his rights and obligations under this Agreement are personal to him
and may not be assigned without the express written consent of the Company.
5.3 Entire Agreement, No Oral Amendments. This Agreement supplements Employee’s Employment
Agreement and replaces and merges all previous agreements and discussions relating to any
non-competition, non-solicitation and/or confidentiality obligations owed by Employee to the
Company and it constitutes the entire agreement between Employee and the
4
Company with respect
to the rights and obligations of either Party in that regard. This Agreement may not
be modified except by a written agreement signed by an executive officer of the Company.
5.4 Enforceability. If a court or arbitrator authorized by this Agreement to resolve disputes
between the Parties determines that any provision of this Agreement is invalid or unenforceable,
the invalid or unenforceable provision will be struck from the Agreement without affecting any
other provision of this Agreement. All remaining provisions of this Agreement that were not struck
will be enforced according to their terms.
5.5 Governing Law, Jurisdiction, and Venue. This Agreement and the rights and obligations of the
Parties hereunder shall be governed and interpreted in accordance with the laws of the State of
Arizona. Additionally, the Parties agree that the courts situated in Maricopa County, Arizona will
have personal jurisdiction over them to hear all disputes arising under, or related to, this
Agreement and that venue will be proper only in Maricopa County, Arizona.
5.6 Injunctive Relief. The Company and Employee agree that a breach of any term of this Agreement
by Employee would cause irreparable harm to the Company and that, in the event of such breach, the
Company will have, in addition to any and all remedies of law, the right to an injunction, specific
performance and other equitable relief to prevent or redress the violation of Employee’s
obligations under this Agreement. Additionally, to provide the Company with the protections it has
bargained for in this Agreement, any period of time in which Employee has been in breach will
extend, by that amount of time, the time for which Employee should be precluded from further
breaching the promises made in the Agreement.
5.7 Attorneys’ Fees. The Company and Employee agree that, if Employee is found to have breached any
tern of this Agreement, the Company will be entitled to recover the attorneys’ fees and costs it
incurred in enforcing this Agreement.
The Parties, intending to be bound, execute this Agreement as of the Effective Date identified in
Employee’s Employment Agreement.
| EMPLOYEE | COMPANY | |||
/s/ Xxxxx Xxxxxxxxx
|
By | /s/ Xxxxxx X. Xxxxxx | ||
Xxxxx Xxxxxxxxx |
||||
| Its | President and Chief Operating Officer | |||
5
APPENDIX B
Date:
|
September 5, 2008 | |
To:
|
Xxxxx Xxxxxxxxx | |
From:
|
Xxx Xxxxxx | |
Re:
|
Senior Vice President — Midwestern Operations |
On behalf of the senior management team of the new Republic, I am pleased to offer you the
position of Senior Vice President — Midwestern Operations effective on the close of our merger
agreement. Here are the highlights of our offer:
| • | Salary: Your base salary will increase by $100K (33%) from $300K to $400K. | |
| • | Perquisite Allowance: No car allowance or club dues allowance will be provided to any executives in the new Republic. | |
| • | Bonus: Your annual management bonus target will be 80% of your salary ($320K). | |
| • | Stock Award: You will be eligible for a stock award in early 2009 valued at roughly $150K. The specific form of the award will be communicated as we finalize our executive compensation plans with the new board’s compensation committee. | |
| • | Long-Term Incentive Plan: You will be eligible to participate in our Long-Term Incentive Plan with a $200K award target. This incentive will be tied to achieving our key financial goals over the next three-year period (2009 — 2011). A new LTIP award opportunity will be established each year so that this incentive will become part of your annual compensation. | |
| • | Integration Bonus: You will be eligible for a one-time integration bonus once we hit our synergy goals. More specifics on this bonus opportunity will be provided separately. | |
| • | Deferred Compensation Plan: An annual contribution of $65K will be made into the Deferred Compensation Plan as a special executive benefit. This contribution is in lieu of a Supplemental Executive Retirement Plan. |
The Central Region office will continue to be located in Indianapolis. This offer is contingent
upon you signing a new non-compete agreement and a new employment agreement. A copy of the
agreements will be provided to you shortly for review.
I look forward to working together to integrate two great companies into the new Republic. Please
sign below to acknowledge your acceptance of this offer.
/s/ Xxxxx Xxxxxxxxx
|
12/3/08 | |
Signature
|
Date |
APPENDIX C
Change in Control means one of the following: (a) the Company merges or consolidates, or
agrees to merge or to consolidate, with any other corporation (other than a wholly-owned direct or
indirect subsidiary of the Company) and is not the surviving corporation (or survives as a
subsidiary of another corporation), (b) the Company sells, or agrees to sell, all or substantially
all of its assets to any other person or entity, (c) the Company is dissolved, (d) any third person
or entity (other than Apollo Advisors, L.P., The Blackstone Group L.P., or a trustee or committee
of any qualified employee benefit plan of the Company) together with its affiliates shall become
(by tender offer or otherwise), directly or indirectly, the beneficial owner of at least 30% of the
voting stock of the Company, or (e) the individuals who constitute the Board of Directors of the
Company as of the Effective Date (“Incumbent Board”) shall cease for any reason to constitute at
least a majority of the Board of Directors; provided, that any person becoming a director whose
election or nomination for election was approved by a majority of the members of the Incumbent
Board shall be considered, for the purposes of this Agreement, a member of the Incumbent Board.
Notwithstanding the foregoing, a “Change in Control” for purposes of this Agreement shall not
include the transaction contemplated by the Agreement and Plan of Merger, dated June 22, 2008, by
and among Republic Services, Inc., RS Merger Wedge, Inc. and Allied Waste Industries, Inc.
