EXECUTIVE EMPLOYMENT
AGREEMENT
This EXECUTIVE
EMPLOYMENT AGREEMENT (“Agreement”) is made and entered
into effective November 30, 2001, by and between ALLIED WASTE
INDUSTRIES, INC., a Delaware corporation having its principal
office at 15880 North Greenway Hayden Loop, Suite 100,
Scottsdale, Arizona 85260 (“Company”) and JOHN S. QUINN
(“Executive”).
WHEREAS, the
Company and the Executive previously entered into an employment
agreement regarding the employment of Executive as the
Company’s Assistant Controller (“Prior
Agreement”); and
WHEREAS, the
Company has promoted Executive to the position of Vice President,
Financial Analysis and Planning, and the Company and the Executive
desire to enter into a new employment agreement (as contained
herein), which shall supersede the Prior Agreement.
NOW, THEREFORE,
for and in consideration of the mutual promises, covenants and
obligations contained herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and the Executive hereby agree as
follows:
1. Certain Definitions . As used in this Agreement, the
following terms have the meanings prescribed below:
Affiliate is used in this Agreement to define a relationship
to a person or entity and means a person or entity who, directly or
indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such person or
entity.
Annual Bonus shall have the meaning assigned thereto in
Section 4.2 hereof.
Base Salary shall have the meaning assigned thereto in
Section 4.1 hereof.
Beneficial Owner shall have the meaning assigned thereto in
Rule 13(d)-3 under the Exchange Act; provided, however, and
without limitation, that any individual, corporation, partnership,
group, association or other person or entity that has the right to
acquire any Voting Stock at any time in the future, whether such
right is (a) contingent or absolute or (b) exercisable
presently or at any time in the future, pursuant to any agreement
or understanding or upon the exercise or conversion of rights,
options or warrants, or otherwise, shall be the Beneficial Owner of
such Voting Stock.
Cause shall have the meaning assigned thereto in
Section 5.3 hereof.
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Change in Control of the Company shall be deemed to have
occurred if (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 a trustee or committee of any qualified employee
benefit plan of the Company) together with its Affiliates shall
become or shall have publicly announced its intention to 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.
Code means the Internal Revenue Code of 1986, as amended,
and the rules and regulations promulgated by the Internal Revenue
Service thereunder, all as in effect from time to time during the
Employment Period.
Common Stock means the Company’s common stock, par
value $.01 per share.
Company means Allied Waste Industries, Inc., a Delaware
corporation, the principal office of which is located at 15880
North Greenway Hayden Loop, Suite 100, Scottsdale, Arizona
85260.
Confidential Information shall have the meaning assigned
thereto in Section 8.2 hereof.
Date of Termination means the earliest to occur of
(a) the date of the Executive’s death, (b) the date on
which the Executive terminates this Agreement for any reason other
than Good Reason, or (c) the date of receipt of the Notice of
Termination, or such later date as may be prescribed in the Notice
of Termination in accordance with Section 5.6
hereof.
Disability means an illness or other disability which
prevents the Executive from discharging his responsibilities under
this Agreement for a period of 180 consecutive calendar days, or an
aggregate of 180 calendar days in any calendar year, during the
Employment Period, all as determined in good faith by the Board of
Directors of the Company (or a committee thereof).
Effective Date means November 30, 2001.
Employment Period shall have the meaning assigned thereto in
Section 3 hereof.
Exchange Act means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the
Securities and Exchange Commission thereunder, all as in effect
from time to time during the Employment Period.
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Executive means John S. Quinn.
Good Reason shall have the meaning assigned thereto in
Section 5.5 hereof.
Notice of Termination shall have the meaning assigned
thereto in Section 5.6 hereof.
Vacation Time shall have the meaning assigned thereto in
Section 4.3 hereof.
Voting Stock means all outstanding shares of capital stock
of the Company entitled to vote generally in an election of
directors; provided, however, that if the Company has shares of
Voting Stock entitled to more or less than one (1) vote per
share, each reference to a proportion of the issued and outstanding
shares of Voting Stock shall be deemed to refer to the proportion
of the aggregate votes entitled to be cast by the issued and
outstanding shares of Voting Stock.
Without Cause shall have the meaning assigned thereto in
Section 5.4 hereof.
2. General Duties of Company and Executive .
2.1.
The Company agrees to employ the Executive, and the Executive
agrees to accept employment by the Company and to serve the Company
as its Vice President, Financial Analysis and Planning. The
authority, duties and responsibilities of the Executive shall be
those assigned by the Board of Directors (or a committee thereof)
and agreed to by the Executive. While employed hereunder, the
Executive shall devote reasonable time and attention during normal
business hours to the affairs of the Company and use his best
efforts to perform faithfully and efficiently his duties and
responsibilities. The Executive may (a) serve on corporate,
civic or charitable boards or committees, (b) deliver
lectures, fulfill speaking engagements or teach at educational
institutions, and (c) manage personal investments, so long as
such activities do not significantly interfere with the performance
of the Executive’s duties and responsibilities.
2.2.
The Executive agrees and acknowledges that he owes a fiduciary duty
of loyalty, fidelity and allegiance to act at all times in the best
interests of the Company and to do no act and to make no statement,
oral or written, which would injure Company’s business, its
interests or its reputation.
2.3.
The Executive agrees to comply at all times during the Employment
Period with all applicable policies, rules and regulations of the
Company, including, without limitation, the Company’s Code of
Ethics and the Company’s policy regarding trading Common
Stock, as each is in effect from time to time during the Employment
Period.
3. Term . Unless sooner terminated pursuant to
Section 5 of this Agreement, the Executive’s Employment
Period under this Agreement shall be a continuous period of two
(2) years, such that on any given date thereafter, the
Executive’s Employment Period shall always be two
(2) years from the date in question.
4. Compensation and Benefits .
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4.1.
Base Salary . As compensation for his services to the
Company, the Company shall pay to the Executive an annual base
salary (“Base Salary”) of (a) the amount specified
as Base Salary in the Prior Agreement, through December 31,
2001, and (b) $225,000.00, beginning January 1, 2002 and until
the Date of Termination. The Board of Directors (or a committee
thereof), in its discretion, may increase the Base Salary based
upon relevant circumstances. The Base Salary shall be payable in
equal semimonthly installments or in accordance with the
Company’s established policy, subject only to such payroll
and withholding deductions as may be required by law and other
deductions applied generally to employees of the Company for
insurance and other employee benefit plans. For all purposes under
this Agreement, the Executive’s Base Salary shall include any
amount which is deferred under any nonqualified plan or
arrangement.
4.2.
Annual Bonus . In addition to the Base Salary, the Executive
shall be awarded, for each fiscal year until the Date of
Termination, an annual bonus (either pursuant to a bonus or
incentive plan or program of the Company or otherwise) in an amount
to be determined by the Board of Directors (or a committee thereof)
in its sole discretion (“Annual Bonus”). The Annual
Bonus shall be based upon a targeted percentage (initially 80%) of
the Executive’s Base Salary each year, and the Board of
Directors (or a committee thereof) shall determine each year, in
its sole discretion, the amount of the targeted percentage and may
adjust such percentage (upward or downward) in its sole discretion.
Each such Annual Bonus shall be payable at a time to be determined
by the Board of Directors (or a committee thereof) in its sole
discretion. For all purposes under this Agreement, the
Executive’s Annual Bonus shall include any amount which is
deferred under any nonqualified plan or arrangement.
4.3.
Vacation . Commencing on the Effective Date and continuing
until the Date of Termination, for each full calendar year that
this Agreement is in effect, the Executive shall be entitled to
four (4) weeks paid vacation (“Vacation Time”).
For any partial calendar year during which this Agreement is in
effect, the amount of vacation time to which the Executive is
entitled shall be prorated. Vacation Time must be taken during the
calendar year in which it accrued and will be forfeited at the end
of the calendar year if not used.
4.4.
Automobile Allowance . Until the Date of Termination, the
Executive shall receive an automobile allowance of $600.00 per
month (“Automobile Allowance”). The Board of Directors
(or a committee thereof), in its discretion, may increase the
Automobile Allowance based upon relevant circumstances.
4.5.
Club Membership Dues . Until the Date of Termination, the
Executive shall receive an amount per month equal to the monthly
membership dues (i.e., the regular membership fee, and not
incidental or ancillary charges such as food, beverages, rentals,
coaching, training, supplies, therapy, spa, etc.) which the
Executive pays for one club or organization of Executive’s
choice.
4.6.
Incentive, Savings, Retirement and Stock Plans . The
Executive shall participate in and be eligible to receive all
benefits under all executive incentive, savings, retirement and
stock (including any stock option, restricted stock, phantom stock
and other stock rights) plans and programs currently maintained or
hereinafter established by the Company for the
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benefit of its
executive officers and/or employees (collectively
“Compensation Plans”). The Executive’s
participation in all such Plans shall be governed by the terms and
provisions of each such Plan.
4.7.
Welfare Benefit Plans . The Executive and/or the
Executive’s family, as the case may be, shall be eligible to
participate in and shall receive all benefits under each welfare
benefit plan of the Company currently maintained or hereinafter
established by the Company for the benefit of its employees. Such
welfare benefit plans may include, without limitation, medical,
dental, vision, disability, group life, accidental death and travel
accident insurance plans and programs (collectively “Welfare
Plans”). The Executive’s and/or the Executive’s
family’s participation in the Welfare Plans shall be subject
to the terms and conditions of each Welfare Plan.
4.8.
Reimbursement of Expenses . The Executive may from time to
time until the Date of Termination incur various business expenses
customarily incurred by persons holding positions of like
responsibility, including, without limitation, travel,
entertainment and similar expenses incurred for the benefit of the
Company. Subject to the Company’s policy regarding the
reimbursement of such expenses as in effect from time to time
during the Employment Period, which does not necessarily allow
reimbursement of all such expenses, the Company shall reimburse the
Executive for such expenses from time to time, at the
Executive’s request, and the Executive shall account to the
Company for all such expenses.
5.1.
Death . This Agreement shall terminate automatically upon
the death of the Executive.
5.2.
Disability . The Company may terminate this Agreement, upon
written notice to the Executive delivered in accordance with
Sections 5.6 and 12.1 hereof, upon the Disability of the
Executive.
5.3.
Cause . The Company may terminate this Agreement, upon
written notice to the Executive delivered in accordance with
Sections 5.6 and 12.1 hereof, for Cause. For purposes of this
Agreement, “Cause” means (a) the conviction of the
Executive for a felony, (b) the Executive’s willful
refusal, without proper legal cause, to perform his duties and
responsibilities as contemplated in this Agreement, or (c) the
Executive’s willfully engaging in activities which (1)
constitute a breach of any term of this Agreement, the
Company’s Code of Ethics, the Company’s policies
regarding trading Common Stock or reimbursement of business
expenses or any other applicable policies, rules or regulations of
the Company or (2) result in a material injury to the
business, condition (financial or otherwise), results of operations
or prospects of the Company or its Affiliates (as determined in
good faith by the Board of Directors of the Company or a committee
thereof). For purposes of the definition of “Cause,” no
act or failure to act shall be considered “willful”
unless it is done, or omitted to be done, in bad faith without
reasonable belief that the action or omission was in the best
interests of the Company.
5.4.
Without Cause . The Company may terminate this Agreement
Without Cause, upon written notice to the Executive delivered in
accordance with Sections 5.6 and 12.1
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hereof. For
purposes of this Agreement, the Executive will be deemed to have
been terminated “Without Cause” if the Executive is
terminated by the Company for any reason other than Cause,
Disability or Death.
5.5.
Good Reason . The Executive may terminate this Agreement for
Good Reason, upon written notice to the Company delivered in
accordance with Sections 5.6 and 12.1 hereof. For purposes of
this Agreement, “Good Reason” means (a) the
assignment to the Executive of any duties inconsistent in any
respect with the Executive’s duties or responsibilities as
contemplated in this Agreement, (b) any other action by the
Company which results in a diminishment in the Executive’s
position (including status, offices, titles and reporting
requirements), authority, duties or responsibilities, (c) any
breach by the Company of any of the provisions of this Agreement,
(d) requiring the Executive to relocate permanently to any office
or location other than the Phoenix-Scottsdale metropolitan area,
without his consent, or (e) any reduction, or attempted
reduction, at any time during the Employment Period, of the Base
Salary or of any of the compensation or benefits described in
Section 4 of this Agreement (provided, however, that any
change in the target percentage for the Annual Bonus, any change in
the Company’s reimbursement policies, or any change in any
Compensation Plans or Welfare Plans, which affects a majority of
the employees covered by those policies or plans, shall not be
considered “Good Reason”).
5.6.
Notice of Termination . Any termination of this Agreement by
the Company for Cause, Without Cause or as a result of the
Executive’s Disability, or by the Executive for Good Reason,
shall be communicated by Notice of Termination to the other party
hereto given in accordance with this Agreement. For purposes of
this Agreement, a “Notice of Termination” means a
written notice which (a) indicates the specific termination
provision in this Agreement relied upon, (b) sets forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive’s employment under the
provision so indicated, and (c) specifies the termination
date, if such date is other than the date of receipt of such notice
(which termination date shall not be more than fifteen
(15) days after the giving of such notice).
6. Obligations of Company Upon Termination .
6.1.
Cause, Other than Good Reason . If this Agreement is
terminated either by the Company for Cause or by the Executive for
any reason other than Good Reason, the Company shall pay to the
Executive, in a lump sum cash payment within thirty (30) days
after the Date of Termination, the aggregate of the
Executive’s Base Salary (as in effect on the Date of
Termination) owing as of the Date of Termination, if not
theretofore paid, and, in the case of compensation previously
deferred by the Executive, all amounts of such compensation
previously deferred and not yet paid by the Company (unless such
payment is inconsistent with the terms of any payment election made
by the Executive with respect to such deferred compensation). The
Company also shall, promptly upon submission by the Executive of
supporting documentation, pay or reimburse to the Executive any
costs and expenses (and moving and relocation expenses, if
otherwise agreed to by the Company) paid or incurred by the
Executive which would have been payable under Section 4.8 of
this Agreement if the Executive’s employment had not
terminated.
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All
other obligations of the Company and rights of the Executive
hereunder shall terminate effective as of the Date of Termination;
provided, however, that the Executive’s rights under any
Compensation Plan or Welfare Plan shall be governed by the terms
and provisions of each such plan and are not necessarily severed on
the Date of Termination.
6.2.
Death or Disability .
(a) Subject
to the provisions of this Section 6.2, if this Agreement is
terminated as a result of the Executive’s death or
Disability, the Company shall pay to the Executive or his estate,
in a lump sum cash payment within thirty (30) days after the
Date of Termination, the greater of (1) that portion of the
Executive’s Base Salary (as in effect on the Date of
Termination) owing in respect of the balance of the Employment
Period pursuant to
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