Exhibit 10.4

 

AMENDMENT TO EMPLOYMENT AGREEMENT

 

BY THIS AMENDMENT, dated December 29, 2008, made and entered into by Casella
Waste Systems, Inc., a Delaware Corporation with a principal address of 25
Greens Hill Lane, Rutland, Vermont 05701 (the “Company”) and Paul Larkin, a
current resident of Manchester, Vermont (the “Employee”).

 

WHEREAS, Company and Employee are parties to that certain Employment Agreement,
dated January 9, 2008, wherein Employee is employed as President and Chief
Operating Officer of Company; and

 

WHEREAS, both Company and Employee desire to amend the EA, effective January 1,
2009, to document compliance with (and, as applicable, exemption from)
Section 409A of the Internal Revenue Code of 1986 and the regulations issued
thereunder, as each may be amended from time to time (“Section 409A”);

 

NOW THEREFORE, in exchange for the promises and mutual conditions contained
herein, and other good and valuable consideration, the parties hereto, intending
to be legally bound, do hereby agree as follows:

 

1.                                       Section 3.2, Incentive Compensation, is
amended to replace the last clause of the last sentence thereof with the
following, in order to clarify the time of payment:

 

and at similar time frames during the Agreement Term (and in any event no later
than 2 ½ months after the end of the later of the Employer’s fiscal year or the
Employee’s taxable year during which the Bonus was earned).

 

2.                                       Section 4.4.1(b), Acceleration Payment,
is amended to insert the following sentence at the end thereof, in order to
clarify the time and form of payment:

 

If payable, the Acceleration Payment shall be paid in an immediate lump sum.

 

3.                                       Section 4.4.1(d), Good Reason, is
amended as follows, in order to comply with the safe harbor definition in
Section 409A:

 

·                  delete the phrase “the occurrence of a Change of Control,
accompanied by, or followed within the twelve-month period after a Change in
Control by”;

 

·                  delete the phrase “or which require travel significantly more
time-consuming than that required at commencement of this Agreement”;

 

·                  insert the word “base” prior to the word “compensation”;

 

·                  insert a new clause immediately prior to the end of
Section 4.4.1(d), to read as follows:  “, or a material change in the geographic
location at which the Employee must perform services for the Company”; and

 

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·                  insert the following immediately following the new clause: 
“; provided, in each case, that the Employee did not consent to the condition
and that the Employee has given the Company notice within 90 days of the initial
existence of the condition and the Company has not remedied the condition within
30 days after receiving such notice.”

 

4.                                       Section 4.4.1(e), Severance, is amended
to read as follows in order to amend the number of months of Severance and
clarify the time and form of payment:

 

“Severance” means (i) one times the highest Base Salary that was paid to the
Employee at any time prior to termination by the Employee for Good Reason or
prior to when the Employee’s employment is terminated by the Company other than
for “Cause”; and (ii) the Bonus targeted to be paid to the Employee pursuant to
Section 3.2 hereof (i.e. 70% of the amount of used in clause (i)).  Any such
severance amounts calculated by reference to Base Salary shall be paid bi-weekly
or otherwise in accordance with Company payroll practices, commencing
immediately upon termination; and any amounts calculated by reference to any
Severance amounts calculated by reference to shall be paid in a lump sum within
sixty (60) days of the date of Employee’s termination, in all cases subject to
any delay imposed under Section 20 and subject to applicable withholding.

 

5.                                       Section 4.4.2 is amended as follows:

 

·                  to move clause (iii) to clause (iv), and to insert clause
(iii) to read:

 

the accelerated vesting at the time of termination of any stock options or
equity shares (such as Restricted Stock Units), and

 

·                  to insert the following sentence immediately prior to the
last sentence thereof, in order to clarify the time of payment:

 

Any payment pursuant to clause (iv) shall be made no later than December 31 of
the year following the year in which the Employee remits the related taxes.

 

6.                                       Section 10, General Release, shall be
moved to Section 11, and all subsequent sections shall be moved one section
number accordingly.

 

7.                                       Section 10 shall be inserted as
Indemnification, and read as follows:

 

The Company agrees that except as limited by the Company’s Certificate of
Incorporation or By-Laws (as either or both may be amended from time to time),
or applicable law, or by decision of the Chairman and Chief Executive Officer of
the Company as exercised prudently, and in good faith, that any such matter as
may otherwise be a matter for Indemnification as contemplated by this Section 10
is not consistent with the Company’s Certificate of Incorporation or By-Laws (as

 

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either or both may be amended from time to time), or applicable law, the Company
shall indemnify the Employee (and promptly advance expenses as may be required)
to the fullest extent permitted by applicable law in effect on the date hereof
and to such greater extent as applicable law may thereafter from time to time
permit.  The Employee shall be entitled to this indemnification if by reason of
his employment or by any reason of anything done or not done by the Employee in
any such capacity he is or is threatened to be made, a party to any threatened,
pending, or completed Proceeding (as defined herein).  Employee will be
indemnified to the full extent permitted by applicable law against expenses,
judgments, penalties, fines and amounts paid in settlement (including all
interest assessments and other charges paid or payable in connection with or in
respect of such expenses, judgments, fines, penalties or amounts paid in
settlement) actually and reasonably incurred by him or on his behalf in
connection with such Proceeding or any claim, issue or matter therein, if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any criminal
Proceeding, had no reasonable cause to believe his conduct was unlawful. 
“Proceeding” includes any threatened, pending, or completed claim, action, suit,
arbitration, alternate dispute resolution mechanism, administrative hearing,
appeal, inquiry or investigation, whether civil, criminal, administrative,
arbitrative, investigative, or other (whether instituted by the Company or any
other party), or any inquiry or investigation that Employee in good faith
believes might lead to the institution of any such action, suit or proceeding
whether civil, criminal, administrative, investigative, or other, including any
action, suit arbitration, alternate dispute resolution mechanism,
administrative  hearing, appeal, or any inquiry or investigation pending on or
prior to the date hereof or initiated by the employee to enforce his rights
under this indemnification section of this Agreement. This indemnification and
the advancement of expenses shall include attorney’s fees and other reasonable
expenses incurred by the employee pursuant to this clause. In the event that
there is a potential conflict of interest between the Employee and the Company
the Employee may select his own counsel (and still be entitled to the benefit of
this indemnification).   This indemnification clause shall survive the
termination of this Agreement.

 

8.                                       Section 11, General Release, is amended
to insert the following additional sentence at the end thereof, in order to
clarify the time and form of payment:

 

Such General Release must be executed and submitted to the Company within 60
days following termination of employment.  Payment of amounts exempt from
Section 409A shall be made (or shall begin, as the case may be) immediately upon
the expiration of the revocation period, but payment of any amounts that
constitute “deferred compensation” within the meaning of Section 409A shall be
made (or begin) immediately upon the expiration of the 60-day period, subject to
any further delay under Section 20.

 

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9.                                       The EA is further amended to add a new
Section 20, Compliance with Section 409A, as follows:

 

20.                                 Compliance with Section 409A.

 

(a)                                  Payments and benefits under this Agreement
are intended to be exempt from Section 409A of the Internal Revenue Code of 1986
and the regulations issued thereunder, as each may be amended from time to time
(“Section 409A”) to the maximum possible extent and, to the extent not exempt,
are intended to comply with the requirements of Section 409A.  The provisions of
this Agreement shall be construed in a manner consistent with such intent.

 

(b)                                 With respect to any “deferred compensation”
within the meaning of Section 409A that is payable or commences to be payable
under this Agreement solely by reason of the Employee’s termination of
employment, such amount shall be payable or commence to be payable as soon as,
and no later than,  the Employee experiences a “separation from service” as
defined in Section 409A, subject to Section 11 of the Agreement and subject to
the six-month delay described below, if applicable.  In addition, nothing in the
Agreement shall require the Company to, and the Company shall not, accelerate
the payment of any amount that constitutes “deferred compensation” except to the
extent permitted under Section 409A.

 

(c)                                  Notwithstanding anything to the contrary in
this Agreement, if the Employee is a “Specified Employee” within the meaning of
Section 409A at the time his employment terminates and any amount payable to the
Employee by virtue of his separation from service constitutes “deferred
compensation” within the meaning of Section 409A, any such amounts that
otherwise would be payable during the first six months following separation from
service shall be delayed and accumulated for a period of six months and paid in
a lump sum on the first day of the seventh month.  Amounts exempt from
Section 409A shall not be so delayed.  The Severance and Severance Benefits
described in Section 4.4.1 of the Agreement are intended to, and shall be
construed to, fit within the short-term deferral and separation pay exceptions
to Section 409A to the maximum permissible extent and each installment thereof
shall be treated as a separate payment for such purposes.

 

(d)                                 Any reimbursements or in-kind benefits
provided to the Employee shall be administered in accordance with Section 409A,
such that:  (a) the amount of expenses eligible for reimbursement, or in-kind
benefits provided, during one year shall not affect the expenses eligible for
reimbursement or the in-kind benefits provided in any other year;
(b) reimbursement of eligible expenses shall be made on or before December 31 of
the year following the year in which the expense was incurred; and (c) the right
to reimbursement or in-kind benefits shall not be subject to liquidation or to
exchange for another benefit.

 

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IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed
this Amendment to Agreement as of the date first set forth above.

 

WITNESS:

/s/ Shelley S. Rogers

 

/s/ Paul Larkin

 

 

 

 

 

 

 

Paul Larkin

 

 

 

 

 

 

 

Date:

12/29/08

 

 

 

 

 

 

 

 

WITNESS:

/s/ Shelley S. Rogers

 

/s/ John W. Casella

 

 

 

 

 

 

 

Casella Waste Systems, Inc.

 

 

 

By: John W. Casella

 

 

 

Its: Chairman and CEO

 

 

 

 

 

 

 

Date:

12/29/2008

 

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