EXECUTIVE EMPLOYMENT AGREEMENT

 

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                                                                   EXHIBIT 10.13

 

                              WASTE SERVICES, INC.

 

                         EXECUTIVE EMPLOYMENT AGREEMENT

 

 

This Employment Agreement (the "Agreement") is dated as of July 1, 2004 by and

between WASTE SERVICES, INC., a Delaware corporation (the "Company") and CHARLES

A. WILCOX (the "Executive"):

 

WHEREAS, the Company desires to employ Executive in an executive capacity and

Executive desires to enter into the Company's employ upon the terms and subject

to the conditions set forth herein.

 

NOW, THEREFORE, in consideration of the mutual promises and agreements set forth

herein, the receipt and adequacy of which are hereby acknowledged, the parties

hereto agree as follows:

 

1.        EMPLOYMENT.

 

The Company shall employ Executive, and Executive shall be employed by the

Company, upon the terms and subject to the conditions set forth in this

Agreement, effective as of July 1, 2004 (the "Effective Date"); provided,

however that as a condition to effectiveness of this Agreement, the Company and

Executive shall have entered into an Indemnification Agreement substantially in

the form of Exhibit A attached hereto.

 

2.        TERM OF EMPLOYMENT.

 

The period of Executive's employment under this Agreement (the "Employment

Term") shall begin on the Effective Date and shall continue until Executive's

employment is terminated in accordance with Section 5 below.

 

3.        DUTIES AND RESPONSIBILITIES.

 

(a)       Executive shall serve as President and Chief Operating Officer of the

         Company and shall report to the Chief Executive Officer of the Company.

         In such capacity, Executive shall have responsibility and authority for

         corporate development, and shall perform the duties necessary to carry

         out those responsibilities and exercise that authority, as may be

         assigned to Executive from time to time by the Chief Executive Officer

         and/or by the Board of Directors of the Company (the "Board of

         Directors") or a duly authorized committee thereof.

 

(b)       During the Employment Term, Executive shall devote his full 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; provided, however, that subject to the

         limitations of Section 8 hereof and to the prior approval of the Chief

         Executive Officer of the Company, Executive may serve on corporate,

         industry, civic or charitable Boards or committees as long as such

         activities do not interfere with the performance of Executive's

         responsibilities to the Company. Executive agrees to act at all times

         in the best interests of the Company and to take no action or make any

         statement, oral or written, which could reasonably be expected by

         Executive to injure the Company's business, financial condition,

         results of operations, prospects, interests or reputation.

 

(c)       Executive agrees to comply at all times during the Employment Term with

         all applicable policies, rules, codes and regulations of the Company in

         effect from time to time, including, without limitation, all applicable

         codes of ethics or conduct and all policies regarding trading in the

         Company's common stock.

 

4.        COMPENSATION AND BENEFITS.

 

(a)       BASE SALARY. During the Employment Term, the Company shall pay

         Executive a base salary at the annual rate of $450,000 USD, or such

         higher rate as may be determined from time to time by the Board of

         Directors or a duly authorized committee thereof (such amount, as

         increased from time to time, the "Base Salary"). Such Base Salary shall

         be paid on the Company's regular pay days in accordance with the

         Company's standard payroll practice for executive officers, 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, Executive's Base

 

 

 

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         Salary shall include any amount which is deferred under any

         nonqualified plan or arrangement of the Company.

 

(b)       INCENTIVE COMPENSATION.

 

         (i)     ANNUAL CASH BONUS. In addition to the Base Salary, Executive

                shall be eligible for an annual cash bonus (either pursuant to a

                bonus or incentive plan or program of the Company or otherwise)

                for each fiscal year during the Employment Term. Executive's

                target annual cash bonus will be equal to 100% (the "Target

                Bonus Rate") of his Base Salary in effect at the beginning of

                the relevant fiscal year, except that Executive's Target Bonus

                Rate shall be 75% of his annual rate of base salary for 2004.

                 The amount of the annual cash bonus, which may be higher or

                lower than the Target Bonus Rate, shall be determined by the

                Board of Directors or a duly authorized committee thereof based

                upon applicable corporate and individual performance targets

                established by the Board of Directors or such committee in its

                sole discretion (the "Annual Bonus"). For all purposes under

                this Agreement, Executive's Annual Bonus shall include any

                amount which is deferred under any nonqualified plan or

                arrangement of the Company.

 

         (ii)    LONG-TERM OR SUPPLEMENTAL INCENTIVE COMPENSATION. Executive

                shall be eligible to participate in any supplemental and/or

                long-term incentive compensation plans or programs (which may

                consist of stock options, restricted stock, long-term cash

                awards or other forms of long-term or supplemental incentive

                compensation) generally made available to full-time senior

                executive officers of the Company.

 

(c)       BENEFIT PLANS. Executive shall be eligible to participate in and

         receive benefits under all retirement, health and welfare benefit

         plans, programs and arrangements which are from time to time available

         to full-time senior executive officers of the Company in accordance

         with the terms and conditions of such plans, programs and arrangements

         in effect from time to time. Such benefit plans, programs and

         arrangements will include family medical, family dental and family

         vision benefit plans and short-term and long-term disability plans, and

         may include, without limitation, life insurance plans, accidental death

         insurance plans, travel accident insurance plans, savings and

         retirement plans and pension plans (all such benefit plans, the

         "Benefit Plans"). At his option, Executive may pay directly the

         premiums for coverage under the above-mentioned disability plans and

         have the Company pay to him, as additional income, an amount equal to

         the amount of those premiums. Executive agrees to submit to a physical

          examination from time to time as requested by the Company to facilitate

         Executive's participation in one or more Benefit Plans. The Company may

         terminate or reduce benefits under any such plans, programs or

         arrangements to the extent such reductions apply uniformly to all

         full-time senior executive officers of the Company, and Executive's

         benefits shall be reduced or terminated accordingly. The Company's

         obligations under this Section 4(c) are expressly conditioned on

         Executive and his family dependents taking all reasonable actions

         (including but not limited to enrolling in all health and welfare

         benefit programs, plans and arrangements which are from time to time

          available to the Company's full-time senior executive officers as and

         when Executive and his family dependents become eligible to participate

         in such programs, plans and arrangements) and providing all information

         as the Company shall reasonably request and as is necessary for the

         Company to fulfill such obligations.

 

(d)       VACATION. In addition to normal statutory holidays recognized by the

         Company, Executive shall be entitled to the greater of (a) four weeks

         of paid vacation for each fiscal year during the Employment Term and

         (b) such other amount of paid vacation as may be afforded executive

         officers under the Company's policies in effect from time to time

         ("Vacation Time").

 

(e)       EXPENSE REIMBURSEMENT. The Company shall promptly reimburse Executive

         for travel and other out-of-pocket expenses incident to his position in

         accordance with the Company's customary practices applicable to

         full-time senior executive officers. To the extent that these expense

         reimbursements are reportable as taxable income, they will be grossed

         up to include the tax due on them.

 

(f)       REIMBURSEMENT OF CERTAIN TAX EXPENSES. The Company shall, upon written

         demand by Executive accompanied by supporting invoices, promptly

         reimburse Executive for all costs and expenses (including reasonable

         legal, accounting and other advisory fees) incurred by Executive to (i)

         determine, in any tax year of Executive, the tax consequences to

         Executive of any amount payable (or reimbursable) under Section 7

         hereof, or (ii) prepare responses to an Internal Revenue Service audit

         of, and to otherwise

 

 

 

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         defend, his personal income tax return for any year during the

         Employment Term or to defend himself in any administrative proceeding

         or civil litigation relating to any such tax return, in each case that

         is occasioned by or related to any audit by the Internal Revenue

         Service of the Company's income tax returns; provided, however, in no

         event shall the Company be required to reimburse Executive for costs

         and expenses in excess of seventy-five thousand United States dollars

         ($75,000 USD) in any given fiscal year pursuant to this Section 4(e).

 

(g)       FRINGE BENEFITS AND PERQUISITES. Executive shall be eligible to

         participate in and receive benefits under all fringe benefit plans,

         practices, policies and programs of the Company to the same extent, and

         subject to the same terms and conditions, as those arrangements are

         made available to full-time senior executive officers of the Company.

 

5.        TERMINATION OF EMPLOYMENT.

 

Executive's employment under this Agreement may be terminated under any of the

circumstances set forth in this Section 5. Upon termination, Executive (or his

beneficiaries or estate as the case may be) shall be entitled to receive the

compensation and benefits described in Section 6 and, if applicable, Section 7

below.

 

(a)       DEATH. Executive's employment hereunder shall terminate automatically

         upon Executive's death.

 

(b)       TOTAL DISABILITY. The Company may terminate Executive's employment

         hereunder, by written notice to Executive delivered in accordance with

         Sections 5(g) and 16 hereof, upon a determination pursuant to this

         Section 5(b) that Executive is "Totally Disabled." For purposes of this

         Agreement, For the purposes of this provision, "Totally Disabled" shall

         have the same meaning as it has under the long-term disability policy

         covering Executive pursuant to paragraph 4(c) herein. Executive's

         receipt of disability benefits under the Company's long-term disability

         plan shall be deemed conclusive evidence of Total Disability for

         purposes of this Agreement.

 

(c)       TERMINATION BY THE COMPANY FOR CAUSE. The Company may terminate

          Executive's employment hereunder for "Cause" at any time, by written

         notice to Executive delivered in accordance with Sections 5(g) and 15

         hereof.

 

         (i)     For purposes of this Agreement, the term "Cause" shall mean any

                 of the following: (A) conviction of a crime (including

                conviction on a nolo contendre plea) involving the commission by

                Executive of a felony or of a misdemeanor involving, in the good

                faith judgment of the Board of Directors, fraud, dishonesty or

                moral turpitude; (B) Executive's deliberate and continual

                refusal to perform the duties and responsibilities assigned to

                Executive under this Agreement (other than as a result of

                vacation permitted under this Agreement, sickness, illness or

                injury); (C) fraud or embezzlement by Executive, determined in

                accordance with the Company's normal, internal investigative

                 procedures consistently applied; (D) gross misconduct or gross

                negligence by Executive in connection with the business of the

                Company or an Affiliate (as defined herein) unless Executive

                reasonably believed, in good faith, that his acts or omissions

                were in or not opposed to the best interests of the Company

                (without intent of Executive to gain therefrom, directly or

                indirectly, a profit to which he was not legally entitled); or

                (E) any material breach by Executive of any of the provisions of

                Section 8 of this Agreement or of any provisions of the

                Confidentiality and Proprietary Information Agreement (as

                defined herein); provided, however, that the occurrence of an

                act or omission covered by clauses (B), (D) or (E) of this

                paragraph 5(c)(i) shall not constitute "Cause" if Executive

                remedies such act or omission within ten (10) business days

                after delivery by the Company of written notice to Executive in

                accordance with Section 15 hereof specifying in reasonable

                detail the facts and circumstances believed by the Company to

                constitute such "Cause."

 

         (ii)    Any determination of Cause under this Agreement shall be made by

                resolution duly adopted by the affirmative vote of at least

                two-thirds of the members of the Board of Directors (not

                including Executive if Executive is a member of the Board of

                Directors) at a meeting of the Board of Directors called and

                held for that purpose; provided that Executive shall have been

                given written notice of such meeting by certified mail at least

                ten (10) business days prior to the meeting and shall have been

                given the opportunity to be heard by the Board of Directors

                before such resolution is passed. The failure by the Company to

                follow the procedures set forth in this Section 5(c)(ii)

 

 

 

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                shall result in the termination of the Executive's employment

                 being deemed to be a termination by the Company without Cause.

 

(d)       TERMINATION BY EXECUTIVE FOR GOOD REASON. Executive may terminate his

         employment hereunder for Good Reason after delivery by Executive of

         written notice to the Company in accordance with Sections 5(g) and 15

         hereof within sixty (60) days after the occurrence of a Good Reason

         Event (as hereinafter defined). For purposes of this Agreement, "Good

         Reason" means the occurrence of any of the following events (each a

         "Good Reason Event") without Executive's written consent during the

         Employment Term:

 

         (i)     A change in Executive's responsibilities or titles or any other

                action by the Company which represents a material diminution of

                Executive's position, status or authority, except in connection

                with or as a result of the termination of Executive's employment

                pursuant to any provision of this Section 5 (a "Dimunition");

                provided, however that such Dimunition shall not constitute

                "Good Reason" or a "Good Reason Event" if the Company remedies

                such Dimunition within ten (10) business days after delivery by

                 Executive of written notice to the Company in accordance with

                Section 15 hereof specifying in reasonable detail the facts and

                circumstances believed by Executive to constitute such

                Dimunition.

 

          (ii)    A reduction by the Company in Executive's Base Salary.

 

         (iii)   A material breach by the Company of Section 4(c) hereof;

                provided, however that such a breach shall not constitute "Good

                Reason" or a "Good Reason Event" if the Company remedies such

                breach within ten (10) business days after delivery by Executive

                of written notice to the Company in accordance with Section 15

                hereof specifying in reasonable detail the facts and

                circumstances believed by Executive to constitute a material

                breach of Section 4(c).

 

         (iv)    The failure by the Company to pay Executive any material amount

                of his Base Salary, or any material amount of other

                compensation, that is due and payable under this Agreement

                within ten (10) business days after Executive makes written

                demand for such amount.

 

         (v)     The failure by the Company to enter into a written agreement

                with any entity that purchases all or substantially all of the

                assets of the Company or any entity into which the Company is

                merged (each a "Successor") pursuant to which such Successor

                agrees to assume all of the obligations of the Company under

                this Agreement at and effective as of the closing of such sale

                of assets or merger.

 

(e)       VOLUNTARY TERMINATION BY EXECUTIVE. Executive may terminate his

         employment hereunder without Good Reason at any time during the

         Employment Term after providing thirty (30) days' written notice to the

         Company delivered in accordance with Sections 5(g) and 15 hereof.

 

(f)       TERMINATION BY THE COMPANY WITHOUT CAUSE. At any time during the

         Employment Term, the Company may terminate Executive's employment

         hereunder without Cause by written notice to Executive delivered in

         accordance with Sections 5(g) and 15 hereof. For purposes of this

         Agreement, Executive's employment will be deemed to have been

         terminated "Without Cause" if Executive is terminated by the Company

         for any reason other than Death pursuant to Section 5(a), Total

         Disability pursuant to Section 5(b), or Cause pursuant to Section 5(c).

 

(g)       NOTICE OF TERMINATION. Any termination of Executive's employment by the

         Company for Cause pursuant to Section 5(c), without Cause pursuant to

         Section 5(f), or as a result of Executive's Total Disability pursuant

         to Section 5(b), or by Executive for Good Reason pursuant to Section

         5(d), 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 (i)

         indicates the specific termination provision in this Agreement relied

         upon, (ii) sets forth in reasonable detail the facts and circumstances

         claimed to provide a basis for termination of Executive's employment

         under the provision so indicated, and (iii) specifies the effective

         date of termination, if such date is other than the date of receipt of

         such notice (which effective date shall not be (A) less than ten (10)

         business days after the giving of such notice in the case of

         termination by Executive for Good Reason or (B) more than 15 days after

          the giving of such notice in all other cases). Any voluntary

         termination of Executive's employment by Executive

 

 

 

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         pursuant to Section 5(e) shall be communicated by written notice to

         the Company specifying (i) that Executive wishes to terminate his

         employment with the Company pursuant to Section 5(e) hereof and (ii)

         indicating the effective date of termination (which effective date

         shall not be less than 30 days after the giving of such notice).

 

6.        COMPENSATION AND BENEFITS FOLLOWING TERMINATION OF EMPLOYMENT.

 

In the event that Executive's employment hereunder is terminated, Executive

shall be entitled to the following compensation and benefits upon such

termination:

 

(a)       COMPENSATION AND BENEFITS PAYABLE FOLLOWING TERMINATION FOR ANY REASON.

         The following compensation and benefits shall be payable upon

         termination of Executive's employment under this Agreement for any

         reason:

 

         (i)     Executive or his beneficiaries or estate shall be entitled to

                receive, within fourteen (14) days after the effective date of

                termination, any accrued but unpaid Base Salary for services

                rendered by Executive to the Company prior to the date of

                termination, any accrued but unpaid expenses required to be

                reimbursed under this Agreement, and cash compensation (at a

                rate per day equal to the Base Salary divided by the number of

                business days in the relevant year) for any accrued Vacation

                Time that remained unused by the Executive at the time of

                termination; and

 

         (ii)    Any earned benefits to which Executive (or his beneficiaries or

                estate) may be entitled pursuant to the plans, policies and

                arrangements referred to in Sections 4(b), 4(c) and 4(g) hereof

                shall be determined and paid in accordance with the terms of

                 such plans, policies and arrangements. In the case of

                compensation previously deferred by Executive, all amounts

                previously deferred and not yet paid by the Company shall be

                paid to Executive (or his beneficiaries or estate) within

                fourteen (14) days after the effective date of termination

                unless such payment is inconsistent with the terms of any

                payment election made by Executive with respect to such deferred

                compensation.

 

(b)       TERMINATION BY REASON OF DEATH. In the event that Executive's

         employment is terminated by reason of Executive's death, the Company

         shall pay Executive's estate the following compensation and benefits in

         addition to the compensation and benefits provided for in Section 6(a)

         above:

 

         (i)     Executive's estate shall be entitled to be paid:

 

                (A)         Executive's Base Salary at the rate in effect

                            immediately prior to Executive's date of death on the

                           Company's regular pay days for a period of three (3)

                           years from the effective date of termination as if

                            his employment had continued until the end of such

                           three (3)-year period; and

 

                (B)         an aggregate amount equal to three (3) times the

                           average of the Annual Bonuses paid to Executive in

                           the three (3) most recently completed fiscal years

                           preceding the effective date of termination, without

                           regard to whether the payment of all or any portion

                            of such Annual Bonus has been deferred (such average

                           being hereinafter referred to as the "Bonus

                           Average"), which shall be paid in equal installments

                           on the Company's regular pay days over the course of

                           thirty-six (36) months from the effective date of

                           termination; provided, however, that if at the time

                           of termination Executive has not been employed by

                           the Company for three fiscal years, the Bonus

                           Average shall be deemed for all purposes of this

                           Agreement to equal Executive's Target Bonus Rate

                            multiplied by his Base Salary at the rate in effect

                           immediately prior to the effective date of

                           termination. The Company may purchase insurance to

                           cover all or any part of the obligations set forth in

                           this Section 6(b)(i) and Executive agrees to submit

                           to a physical examination from time to time to

                           facilitate the procurement or renewal of such

                           insurance. Any proceeds of such insurance paid to

                           Executive or his beneficiaries or estate shall be

                           considered a portion of the payments required to be

                            made to Executive pursuant to this Section 6(b)(i)

                           and shall not be in addition thereto.

 

         (ii)    Executive's dependents shall be entitled to continue to receive

                medical, dental and vision insurance coverage at least equal in

                type and amount to that made available to dependents of

                full-

 

 

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                time senior executives of the Company immediately prior to

                Executive's death for a period of three (3) years from the

                effective date of termination, or until Executive's dependents

                become eligible for substantially equivalent employer-provided

                health insurance benefits from any other person or business

                entity, whichever occurs first. In the event that participation

                in any such plan, program or arrangement of the Company is

                prohibited, the Company will arrange to provide benefits

                 substantially similar to those benefits which Executive's

                dependents would have been entitled to receive under such plan,

                program or arrangement for such period.

 

         (iii)   All of Executive's then outstanding options to purchase shares

                of the Company's common stock shall be vested and exercisable in

                accordance with the terms of the stock option plan of the

                Company pursuant to which such options were granted (the

                 "Governing Stock Option Plan") as then in effect.

 

(c)       TERMINATION BY REASON OF TOTAL DISABILITY. In the event that

         Executive's employment is terminated by reason of Executive's Total

         Disability pursuant to Section 5(b) hereof, the Company shall pay

         Executive the following compensation and benefits in addition to the

         compensation and benefits provided for in Section 6(a) above:

 

         (i)     Subject to Section 6(c)(ii) below, Executive shall be entitled

                 to be paid:

 

                (A)         his Base Salary at the rate in effect immediately

                           prior to the effective date of termination on the

                           Company's regular pay days for a period of three (3)

                           years from the effective date of termination as if

                           his employment had continued until the end of such

                           three (3) year period; and

 

                (B)         an aggregate amount equal to three (3) times the

                           Bonus Average, which shall be paid in equal

                           installments on the Company's regular pay days over

                           the course of thirty-six (36) months from the

                           effective date of termination.

 

         (ii)    Whenever compensation is payable