##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
 Form 10-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31,
    2009oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period from
    to   Commission file number
    000-25955
 Waste Services, Inc.
 (Successor registrant of Capital
    Environmental Resource Inc. now known as Waste Services
    (CA) Inc.)
 (Exact name of registrant as
    defined in its charter)
  DelawareState or other jurisdiction
    of
    incorporation or organization

01-0780204(I.R.S. Employer
    Identification No.)1122 International Blvd.
    Suite 601, Burlington, Ontario Canada(Address of principal
    executive offices)

L7L 6Z8(Zip
    Code)   Registrants telephone number, including area code:
 (905) 319-1237
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, par value $0.01 per share

NASDAQ Stock Market LLC   Securities registered pursuant to Section 12(g) of the
    Act:
 None
 (Title of Class)
  o þ
  o þ
  o þ
  Regulation S-K Form 10-K Form 10-K. o
  12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller
    reporting
    company o     Rule 12b-2 o þ
      DOCUMENTS INCORPORATED BY REFERENCE  None




---



##### 





INDEX TO
    FORM 10-K
    FOR THE YEAR ENDED DECEMBER 31, 2009
   
 PART IItem 1.

Business


2Item 1A.

Risk Factors


9Item 1B.

Unresolved Staff Comments


14Item 2.

Properties


15Item 3.

Legal Proceedings


15Item 4.

(Removed and Reserved)


15PART IIItem 5.

Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


15Item 6.

Selected Financial Data


18Item 7.

Managements Discussion and Analysis of
    Financial Condition and Results of Operations


19Item 7A.

Quantitative and Qualitative Disclosures About
    Market Risk


47Item 8.

Financial Statements and Supplementary Data


47Item 9.

Changes in and Disagreements With Accountants on
    Accounting and Financial Disclosure


47Item 9A.

Controls and Procedures


47Item 9B.

Other Information


48PART IIIItem 10.

Directors, Executive Officers and Corporate
    Governance


48Item 11.

Executive Compensation


52Item 12.

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


68Item 13.

Certain Relationships and Related Transactions,
    and Director Independence


70Item 14.

Principal Accounting Fees and Services


72PART IVItem 15.

Exhibits, Financial Statement Schedules


73EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1    Managements Report on Internal Control Over
    Financial Reporting


F-2Reports of Independent Registered Public
    Accounting Firm


F-3Consolidated Balance Sheets


F-5Consolidated Statements of Operations and
    Comprehensive Income (Loss)


F-6Consolidated Statements of Shareholders
    Equity


F-7Consolidated Statements of Cash Flows


F-8Notes to Consolidated Financial Statements


F-9




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PART I
    CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
    STATEMENTS



This annual report on
    Form 10-K
    contains certain forward-looking statements within
    the meaning of Section 21E of the Securities Exchange Act
    of 1934. Some of these forward-looking statements include
    forward-looking phrases such as anticipates,
    believes, could, estimates,
    expects, foresees, intends,
    may, should or will
    continue, or similar expressions or the negatives thereof
    or other variations on these expressions, or similar
    terminology, or discussions of strategy, plans or intentions.



Such statements reflect our current views regarding future
    events and are subject to certain risks, uncertainties and
    assumptions. Many factors could cause the actual results,
    performance or achievements to be materially different from any
    future results, performance or achievements that forward-looking
    statements may express or imply, including, among others: 
    effect on our business resulting from uncertainties surrounding
    the proposed merger with IESI-BFC Ltd. and costs associated with
    the proposed merger;
    our substantial indebtedness and the significant restrictive
    covenants in our various credit facilities and our ability to
    finance acquisitions and/or capital expenditures with cash on
    hand, debt or equity offerings;
    our ability to pay principal debt amounts due at maturity;
    our business is capital intensive and may consume cash in excess
    of cash flow from operations and borrowings;
    our ability to vertically integrate our operations;
    our ability to maintain and perform our financial assurance
    obligations;
    changes in regulations affecting our business and costs of
    compliance;
    revocation of existing permits and licenses or the refusal to
    renew or grant new permits and licenses, which are required to
    enable us to operate our business or implement our growth
    strategy;
    our domestic operations are concentrated in Florida, which may
    be subject to specific economic conditions that vary from those
    nationally as well as weather related events that may impact our
    operations;
    construction, equipment delivery or permitting delays for our
    transfer stations or landfills;
    our ability to successfully implement our corporate strategy and
    integrate any acquisitions we undertake;
    our ability to negotiate renewals of existing service agreements
    at favorable rates;
    our ability to enhance profitability of certain aspects of our
    operations in markets where we are not internalized through
    either divestiture or asset swaps;
    costs and risks associated with litigation; and
    changes in general business and economic conditions, commodity
    pricing, exchange rates, the financial markets and accounting
    standards or pronouncements.  Form 10-K
 1




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##### Table of Contents



Item 1.
    Business  Overview
          (905) 319-1237.
  Form 10-K, Form 10-Q, Form 8-K SEC-0330.
  Form 10-K, Form 10-Q, Form 8-K
  Proposed
    Merger with IESI-BFC
   2




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full-service
    out-of-pocket out-of-pocket
  Business
    Strategy
    Maximize Density and Vertically Integrate
    Operations.
  Provide Consistent, Superior Customer
    Service.
  Maintain a Decentralized Operating Management Structure with
    Centralized Controls and Information Systems.
 3




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Execute a Disciplined, Disposal-Based Growth
    Strategy.
    
    are complementary to our existing infrastructure, allowing us to
    increase the density of our collection routes or enhance asset
    utilization; or
    increase the waste volume that can be internalized into our
    landfills.    
    benefit from an above-average underlying economic or population
    growth, or a changing competitive or regulatory environment that
    could lead to above-average growth for non-hazardous solid waste
    services;
    over time establish a leading market position; and
    secure a disposal facility and subsequently become vertically
    integrated through tuck-in acquisitions (with the ability to
    ultimately secure significant internalized waste volumes).  Operations
      Eastern


Western


TotalCanada


Canada


Canada


Florida


TotalCollection operations


14



10



24



10



34Transfer stations


9



2



11



10



21Recycling facilities


5



1



6



7



13Landfills


1



2



3



4



7   Collection
    Services
    Commercial and Industrial Collection.
 4




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Residential Collection.
      Transfer
    Station Services
      Commercial
    and Residential Recycling Services
   5




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Landfill
    Disposal Services
      Other
    Specialized Services
    Local/Regional
    Operating Structure
  day-to-day
  Sales and
    Marketing
    Competition
     6




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Government
    Regulation
           7




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8




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##### Table of Contents



Employees
    Item 1A.
    Risk
    Factors  Failure
    to complete the merger with IESI-BFC could negatively impact our
    stock price and our future business and financial
    results.
    
    we may be required to pay IESI-BFC a termination fee of
    $11 million plus an amount equal to all
    out-of-pocket
    costs up to $3.5 million for expenses incurred by IESI-BFC
    in connection with the merger if the merger agreement is
    terminated under certain circumstances;
    we will be required to pay certain costs relating to the merger,
    whether or not the merger is completed; and
    matters relating to the merger (including integration planning)
    may require substantial commitments of time and resources by our
    management, which could otherwise have been devoted to other
    opportunities that may have been beneficial to us as an
    independent company.    Our
    indebtedness may make us more vulnerable to unfavorable economic
    conditions and competitive pressures, limit our ability to
    borrow additional funds, require us to dedicate or reserve a
    large portion of cash flow from operations to service debt, and
    limit our ability to take actions that would increase our
    revenue and execute our growth strategy
  1 2
 9




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Our
    business is capital intensive and may consume cash in excess of
    cash flow from our operations and borrowings
        We may
    be unable to obtain or maintain the environmental and other
    permits, licenses and approvals we need to operate our business,
    which could adversely affect our earnings and cash
    flow
     10




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Our
    acquisition strategy may be unsuccessful if we are unable to
    identify and complete future acquisitions and integrate acquired
    assets or businesses and this subjects us to risks that may have
    a material adverse effect on our results of
    operations
      Our
    business strategy depends in part upon vertically integrating
    our operations. If we are unable to permit, expand or renew
    permits for our existing landfill sites or enter into agreements
    that provide us with access to landfill sites and acquire, lease
    or otherwise secure access to transfer stations, this may reduce
    our profitability and cash flow
   11




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Any
    exposure to environmental liabilities, to the extent not
    adequately covered by insurance, could result in significant
    expenses, which would reduce the funds we have available for
    other purposes, including debt service, debt reduction and
    acquisitions
      We
    face competition from large and small solid waste services
    companies and may be unable to successfully compete with them,
    reducing our operating margins
     12




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The
    termination or non-renewal of existing customer contracts, or
    the failure to obtain new customer contracts, could result in
    declining revenue
          Labor
    unions may attempt to organize our non-unionized employees,
    which may result in increased operating expenses
    Our
    operating margins and profitability may be negatively impacted
    by increased fuel and energy costs and changes in prices for
    recycled commodities
      Our
    domestic operations are concentrated in Florida, which may be
    subject to specific economic conditions that vary from those
    nationally as well as weather related events that may impact our
    operations
  and/or
 13




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The
    industry in which we operate is seasonal and decreases in
    revenue during winter months may have an adverse effect on our
    results of operations, particularly for our Canadian
    operations
    Our
    Canadian operations subject us to currency translation risk,
    which could cause our results to fluctuate significantly from
    period to period
    Changes
    to patterns regarding disposal of waste could adversely affect
    our results of operations by reducing the volume of waste
    available for collection and disposal and thus reducing our
    earnings
    Limits
    on export of waste and any disruptions to the cross-border flow
    of waste may adversely affect our results of operations by
    increasing our costs of disposal
    Item 1B.
    Unresolved
    Staff Comments   14




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Item 2.
    Properties      Collection


Transfer


RecyclingAdministrative


Operations


Stations


Facilities


LandfillsOwned






17



13



8



7Leased


1



17



8



5



Total


1



34



21



13



7     Item 3.
    Legal
    Proceedings    Item 4.
    (Removed
    and Reserved) PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities  Market
    Information
   15




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High

LowYear ended December 31, 2009First Quarter

$
6.85


$
3.87Second Quarter


6.15



4.15Third Quarter


5.54



4.20Fourth Quarter


9.31



4.54Year ended December 31, 2008First Quarter

$
9.76


$
7.60Second Quarter


8.42



6.75Third Quarter


9.55



6.52Fourth Quarter


8.00



5.20   Holders
    Dividends
      Repurchases
    of Securities
   16




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Performance
    graph
    
  (1)
    
    We do not believe that there is a single published industry or
    line of business index that is appropriate for comparing
    stockholder returns. The Peer Group is comprised of
    representative companies within the solid waste management
    industry whose common stock is publicly-traded. The Peer Group
    for 2009 consists of Casella Waste Systems, Inc., Republic
    Services, Inc., Waste Connections, Inc., and Waste Management,
    Inc. 17




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Item 6.
    Selected
    Financial Data    For Each of the Years Ended December 31,2009

2008

2007

2006

2005(In thousands of U.S. dollars, except per share amounts)Statement of Operations and Cash Flow Data:Revenue

$
434,515


$
473,029


$
461,447


$
362,672


$
327,163Income from operations


56,701



41,659



40,813



13,272



8,919Income (loss) from continuing operations


14,054



(1,956
)


(14,303
)


(49,530
)


(51,596
)Income from discontinued operations net of income tax provision
    of nil, $266, nil, $652 and $852 for the years ended
    December 31, 2009, 2008, 2007, 2006 and 2005, respectively






409



2,796



999



1,306Gain (loss) on sale of discontinued operations, net of income
    tax provision of $7,255 for the year ended December 31,
    2008 and nil for all other years






11,110



(11,607
)






Net income (loss)


14,054



9,563



(23,114
)


(48,531
)


(50,290
)Earnings (loss) per share, basic and diluted 
    continuing operations

$
0.30


$
(0.04
)

$
(0.31
)

$
(1.40
)

$
(1.57
)Earnings (loss) per share, basic and diluted 
    discontinued operations






0.25



(0.19
)


0.03



0.04Earnings (loss) per share  basic and diluted


0.30



0.21



(0.50
)


(1.37
)


(1.53
)Weighted average common shares outstanding Basic


46,218



46,079



46,007



35,354



32,880Diluted


46,325



46,079



46,007



35,354



32,880Cash flows from operating activities ofcontinuing operations

$
64,353


$
56,051


$
54,677


$
26,668


$
14,372Capital expenditures for continuing operations


32,212



48,066



57,557



39,747



25,455Average exchange rate C$ to US$

$
0.8757


$
0.9381


$
0.9303


$
0.8817


$
0.8255   18




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##### Table of Contents



As of December 31,2009


2008


2007


2006


2005(In thousands of U.S. dollars, except exchange rate data)Balance Sheet Data:Cash

$
3,699


$
7,227


$
20,706


$
8,532


$
8,885Property, equipment and landfill sites, net


400,847



385,432



383,049



322,574



219,202Goodwill and other intangible assets, net


419,439



372,886



397,766



323,939



281,287Total assets


914,992



840,927



938,488



865,063



728,389Total debt and capital lease obligations (exclusive of
    cumulative mandatorily redeemable Preferred Stock)


402,022



372,952



445,539



410,353



286,669Cumulative mandatorily redeemable Preferred Stock


















84,971Total shareholders equity


359,348



335,018



350,595



339,357



264,491Year end exchange rate C$ to US$

$
0.9515


$
0.8210


$
1.0088


$
0.8581


$
0.8598   Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations    Overview
    Sources
    of Revenue
         19




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##### Table of Contents



Expense
    Structure
          units-of-consumption not-to-compete,
  Recent
    Developments
  Proposed
    Merger with IESI-BFC
   20




---



##### Table of Contents



out-of-pocket out-of-pocket
  Acquisitions
    and Dispositions
             21




---



##### Table of Contents



Clean-up
         22




---



##### Table of Contents



Critical
    Accounting Estimates and Policies
  General
      Revenue
    Recognition
   23




---



##### Table of Contents



Accounts
    Receivable and Allowance for Doubtful Accounts
    Business
    Acquisitions and Goodwill
           24




---



##### Table of Contents



and/or
  
    The fact that, to a significant extent, our shares are held by
    insiders and affiliates, reducing market liquidity.
    The perception that one of our larger shareholders, due to
    circumstances unrelated to us, was liquidating their position
    putting pressure on the market price of our shares.
    We believe that in general, the market had continued to discount
    the value of common equity, believing that current leverage
    ratios are not sustainable and companies will be required to
    refinance debt at higher rates
    and/or issue
    additional equity thereby diluting current shareholders.
    However, as a result of the October 2008 refinancing of our
    Senior Secured Credit Facilities and September 2009 additional
    private placement of $50.0 million aggregate principal of
    our Senior Subordinated Notes, we believe our capital structure
    has been stable, but such stability was not reflected in our
    share price.     25




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##### Table of Contents



Long-Lived
    Assets
        Landfill
    Sites
    units-of-consumption
 26




---



##### Table of Contents



27




---



##### Table of Contents



December 31, 2009Balance,








Changes in





Balance,Beginning


Landfills


Landfills


Engineering


Airspace


Endof Year


Acquired


Expanded


Estimates


Consumed


of YearUnited StatesPermitted capacity


80,025















(2,204
)


77,821Probable expansion capacity






















Total available airspace


80,025















(2,204
)


77,821Number of sites


4



















4CanadaPermitted capacity


11,018







4,709







(321
)


15,406Probable expansion capacity


4,852







(4,709
)


(143
)






Total available airspace


15,870











(143
)


(321
)


15,406Number of sites


3



















3TotalPermitted capacity


91,043







4,709







(2,525
)


93,227Probable expansion capacity


4,852







(4,709
)


(143
)






Total available airspace


95,895











(143
)


(2,525
)


93,227Number of sites


7



















7     28




---



##### Table of Contents



December 31, 2008Balance,








Changes in





Balance,Beginning


Landfills


Landfills


Engineering


Airspace


Endof Year


Acquired


Expanded


Estimates


Consumed


of YearUnited StatesPermitted capacity


51,255



580



29,577







(1,387
)


80,025Probable expansion capacity


29,577







(29,577
)










Total available airspace


80,832



580











(1,387
)


80,025Number of sites


3



1















4CanadaPermitted capacity


11,564















(546
)


11,018Probable expansion capacity


4,709











143







4,852Total available airspace


16,273











143



(546
)


15,870Number of sites


3



















3TotalPermitted capacity


62,819



580



29,577







(1,933
)


91,043Probable expansion capacity


34,286







(29,577
)


143







4,852Total available airspace


97,105



580







143



(1,933
)


95,895Number of sites


6



1















7     December 31, 2007Balance,








Changes in





Balance,Beginning


Landfills


Landfills


Engineering


Airspace


Endof Year


Acquired


Expanded


Estimates


Consumed


of YearUnited StatesPermitted capacity


53,792















(2,537
)


51,255Probable expansion capacity


18,300







11,277











29,577Total available airspace


72,092







11,277







(2,537
)


80,832Number of sites


3



















3CanadaPermitted capacity


11,644











533



(613
)


11,564Probable expansion capacity


4,970











(261
)






4,709Total available airspace


16,614











272



(613
)


16,273Number of sites


3



















3TotalPermitted capacity


65,436











533



(3,150
)


62,819Probable expansion capacity


23,270







11,277



(261
)






34,286Total available airspace


88,706







11,277



272



(3,150
)


97,105Number of sites


6



















6   Accrued
    Closure and Post-Closure Obligations
   29




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##### Table of Contents



units-of-consumption
    Accounting
    for Income Taxes
      
    an allocation or a shift of income between taxing jurisdictions,
    the characterization of income or a decision to exclude
    reporting taxable income in a tax return, or
    a decision to classify a transaction, entity, or other position
    in a tax return as tax exempt.   30




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Risk
    Management
  U.S.-based
  Share-Based
    Payments
        Registration
    Payment Arrangements
    Translation
    and Re-Measurement of Foreign Currency
   31




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As of:December 31, 2009

$
0.9515December 31, 2008


0.8210For the years ended:December 31, 2009

$
0.8757December 31, 2008


0.9381December 31, 2007


0.9303   Operating
    Results
  Results
    of Operations for each of the Three Years Ended
    December 31, 2009, 2008 and 2007
    2009Florida


Canada


TotalRevenue

$
209,251



100.0
%

$
225,264



100.0
%

$
434,515



100.0
%Operating expenses:Cost of operations


128,489



61.4
%


148,976



66.1
%


277,465



63.9
%Selling, general and administrative expense


29,466



14.1
%


28,875



12.8
%


58,341



13.4
%Depreciation, depletion and amortization


26,710



12.8
%


17,868



7.9
%


44,578



10.3
%Gain on sale of property and equipment,foreign exchange and other


(2,960
)


−1.5
%


390



0.3
%


(2,570
)


−0.6
%Income from operations

$
27,546



13.2
%

$
29,155



12.9
%

$
56,701



13.0
%   2008Florida


Canada


TotalRevenue

$
231,352



100.0
%

$
241,677



100.0
%

$
473,029



100.0
%Operating expenses:Cost of operations


148,474



64.2
%


160,647



66.5
%


309,121



65.3
%Selling, general and administrative expense


30,027



13.0
%


29,576



12.2
%


59,603



12.6
%Restructuring, severance and related costs


4,673



2.0
%


2,198



0.9
%


6,871



1.5
%Landfill development project costs


10,267



4.4
%






0.0
%


10,267



2.2
%Depreciation, depletion and amortization


26,145



11.3
%


19,203



7.9
%


45,348



9.6
%Gain on sale of property and equipment,foreign exchange and other


(628
)


−0.3
%


788



0.4
%


160



0.0
%Income from operations

$
12,394



5.4
%

$
29,265



12.1
%

$
41,659



8.8
%   32




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##### Table of Contents



2007Florida


Canada


TotalRevenue

$
239,384



100.0
%

$
222,063



100.0
%

$
461,447



100.0
%Operating expenses:Cost of operations


154,250



64.4
%


147,323



66.3
%


301,573



65.3
%Selling, general and administrative expense


32,094



13.4
%


28,150



12.7
%


60,244



13.1
%Severance and related costs


3,995



1.7
%






0.0
%


3,995



0.9
%Depreciation, depletion and amortization


35,262



14.8
%


19,629



8.8
%


54,891



11.9
%Gain on sale of property and equipment,foreign exchange and other


282



0.1
%


(351
)


−0.1
%


(69
)


0.0
%Income from operations

$
13,501



5.6
%

$
27,312



12.3
%

$
40,813



8.8
%   Revenue
    2009


2008


2007Collection

$
364,503



74.9
%

$
390,768



74.6
%

$
371,700



72.5
%Landfill disposal


45,689



9.4
%


47,310



9.0
%


59,015



11.5
%Transfer station


65,466



13.5
%


65,210



12.5
%


62,096



12.1
%Material recovery facilities


9,823



2.0
%


18,531



3.5
%


18,372



3.6
%Other specialized services


1,115



0.2
%


1,760



0.4
%


1,259



0.3
%486,596



100.0
%


523,579



100.0
%


512,442



100.0
%Intercompany elimination


(52,081
)






(50,550
)






(50,995
)$
434,515






$
473,029






$
461,447        33




---



##### Table of Contents



Cost
    of Operations
          sub-contractor
    Selling,
    General and Administrative Expense
   34




---



##### Table of Contents



Restructuring,
    Severance and Related Costs
  sub-let
     35




---



##### Table of Contents



Landfill
    Development Project
    Depreciation,
    Depletion and Amortization
      Loss
    (Gain) on Sale of Property and Equipment, Foreign Exchange and
    Other
     36




---



##### Table of Contents



Interest
    Expense
    2009


2008


2007Senior Secured Credit Facilities

$
8,534


$
14,433


$
21,473Senior Subordinated Notes


16,519



15,600



15,200Amortization of debt issue costs and discounts


3,574



5,377



2,362Other interest expense


2,340



2,022



1,644$
30,967


$
37,432


$
40,679           Change
    in Fair Value of Warrants
   37




---



##### Table of Contents



Income
    Tax Provision
           38




---



##### Table of Contents



Liquidity
    and Capital Resources
  and/or
    Senior
    Secured Credit Facilities
   39




---



##### Table of Contents



Maximum

Maximum

MinimumConsolidated

Consolidated

ConsolidatedLeverage

Senior Secured

InterestRatio

Leverage Ratio

Coverage RatioFourth quarter  2009

4.25 : 1.00

2.75 : 1.00

2.75 : 1.00First quarter  2010

4.25 : 1.00

2.75 : 1.00

2.75 : 1.00Second quarter  2010

4.25 : 1.00

2.75 : 1.00

2.75 : 1.00Third quarter  2010

4.00 : 1.00

2.75 : 1.00

2.75 : 1.00Fourth quarter  2010

4.00 : 1.00

2.75 : 1.00

2.75 : 1.00       Direct
    Financing Lease Facility
    Senior
    Subordinated Notes
  1 2
 40




---



##### Table of Contents



Migration
    Transaction
    non-U.S. residents
   41




---



##### Table of Contents



Surety
    Bonds, Letters of Credit and Insurance
      Registration
    Payment Arrangement
  90-days 90-day
  Cash
    Flows
   42




---



##### Table of Contents



Cash
    Flows from Operating Activities
        Cash
    Flows from Investing Activities
    Clean-up
  Cash
    Flows from Financing Activities
   43




---



##### Table of Contents



New
    Accounting Pronouncements
  No. 2010-06, 2010-06). 2010-06 2010-06
  2009-17, 2009-17). 2009-17 2009-17 2009-17 2009-17
      Seasonality
   44




---



##### Table of Contents



Off-Balance
    Sheet Financing
      Tabular
    Disclosure of Contractual Obligations
   45




---



##### Table of Contents



Beyond 52010


2011


2012


2013


2014


Years


TotalSenior secured credit facilities(1)

$
18,638


$
26,921


$
45,560


$
97,833


$



$



$
188,952Senior subordinated notes payable


















210,000







210,000Senior subordinated notes interest commitments


19,950



19,950



19,950



19,950



9,975







89,775Other secured notes payable


1,595



1,500



1,500



1,500



749







6,844Capital lease obligations


585























585Other subordinated notes payable


232



247



265



283



302



849



2,178Operating lease commitments(4)


3,994



3,821



3,487



3,150



1,633



3,205



19,290Construction commitments


1,054



42



42



2











1,140Asset purchase commitments


3,125























3,125Other contracted commitments


373



360



360



360



120







1,573Closure and post-closure obligations(2)


4,834



1,114



468



4,298



1,074



117,444



129,232Deferred purchase price(3)


1,478























1,478Restructuring, severance and related(4)


2,191



857



483



421



421



586



4,959$
58,049


$
54,812


$
72,115


$
127,797


$
224,274


$
122,084


$
659,131     (1)
    
    Our Senior Secured Credit Facilities are subject to variable
    interest rates and therefore our interest commitments are
    unknown. Additionally, amounts outstanding under our revolver
    facilities can be repaid and subsequently re-borrowed at anytime
    prior to their maturity. As such, we have not made any estimates
    with regard to future interest payments on these facilities.
    Please see the Notes to our Consolidated Financial Statements
    included elsewhere in this report for information relative to
    interest repayment provisions.(2)
    
    Future payments on closure and post-closure obligations are not
    discounted and contemplate full utilization of current and
    probable expansion airspace.(3)
    
    Relates to the remaining balance of deferred purchase price for
    the acquisition of Commercial
    Clean-up,
    which was completed in December 2008.(4)
    
    Relates to future payments required as a result of our fourth
    quarter 2008 restructuring of corporate overhead and other
    administrative and operational functions, and remaining payments
    to Mr. Charles Wilcox required under his separation
    agreement. Amounts presented under the operating lease
    commitments caption do not include future lease payments
    relative to our U.S. corporate office, which are included under
    the restructuring, severance and related caption and
    do not include estimated sublease rental income for the U.S.
    corporate office lease, which totals $0.9 million, and are
    not discounted.  Other
    Contractual Arrangements
     46




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk        Item 8.
    Financial
    Statements and Supplementary Data  Page F-1.
  Item 9.
    Changes
    in and Disagreements With Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Evaluation
    of Disclosure Controls and Procedures
   47




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##### Table of Contents



Rule 13a-15).
  Changes
    in Internal Control Over Financial Reporting
    Managements
    Report on Internal Control Over Financial Reporting
    Attestation
    Report of Independent Registered Public Accounting
    Firm
    Item 9B.
    Other
    Information   PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance    DirectorName

Age


Since

PositionClass III  Three year term expires 2012Michael H. DeGroote


49


July 22, 2008

DirectorWallace L. Timmeny


72


July 28, 2004

DirectorMichael J. Verrochi


70


July 28, 2004

DirectorClass II  Three year term expires 2011Michael B. Lazar


40


May 6, 2003

DirectorLucien Rémillard


62


September 6, 2001

DirectorJack E. Short


68


July 28, 2004

DirectorClass I  Three year term expires 2010Gary W. DeGroote


54


September 6, 2001

DirectorGeorge E. Matelich


53


May 6, 2003

DirectorDavid Sutherland-Yoest


53


September 6, 2001

Director, President andChief Executive Officer     Gary W. DeGroote
 48




---



##### Table of Contents



Michael H. DeGroote
    George E. Matelich
    Michael B. Lazar
    Lucien Rémillard
    Jack E. Short
 49




---



##### Table of Contents



Wallace L. Timmeny
    Michael J. Verrochi
    Michael G. DeGroote
    Name

Age

Position

SinceDavid Sutherland-Yoest

53

President and Chief Executive Officer

CEO since September 6, 2001 President since
    October 30, 2007Ivan R. Cairns

64

Executive Vice President,
    General Counsel and Secretary

January 5, 2004Edwin D. Johnson

53

Executive Vice President,
    Chief Financial Officer and
    Chief Accounting Officer

March 12, 2007William P. Hulligan

66

Executive Vice President,
    U.S. Operations

October 30, 2007Wayne R. Bishop

51

Senior Vice President and Controller

January 5, 2009     David Sutherland-Yoest 2 2
 50




---



##### Table of Contents



Ivan R. Cairns
  Edwin D. Johnson start-up
  William P. Hulligan
  Wayne R. Bishop
  Section 16(a)
    Beneficial Ownership Reporting Compliance
    Code of
    Ethics
  http://www.wasteservicesinc.com.
  Audit
    Committee
   51




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##### Table of Contents



Item 11.
    Executive
    Compensation  Compensation
    Discussion and Analysis
      
    base salary;
    short term incentive compensation consisting of annual cash
    bonus and discretionary bonus awards; and
    long term incentive compensation consisting of equity based
    awards.      
    annual cash bonus awards pursuant to our short term incentive
    plan as a percentage of base salary. The award of annual cash
    bonuses pursuant to our short term incentive plan is based, 80%
    on the level of achieving or exceeding in the fiscal year,
    budgeted earnings before interest and taxes (Adjusted
    EBIT) and 20% on achieving personal goals and Sarbanes
    Oxley compliance and is at the discretion of the employees
    immediate supervisor. Adjusted EBIT is a non-GAAP financial
    measure that is calculated by making similar adjustments to
    earnings before interest and taxes (EBIT) as are
    required to calculate Adjusted EBITDA as defined under our
    Credit Agreement for our senior credit facilities. Budgeted
    Adjusted EBIT for fiscal 2009 was fixed in February as part of
    the budget process. Budgeted Adjusted EBIT is subject to
    adjustment by the Compensation Committee at the time the short
    term bonuses are awarded to reflect acquisitions, divestitures
    and other unusual items occurring between the time that budgeted
    Adjusted EBIT was fixed for the fiscal year and the time of
    award; and
    discretionary cash bonuses to reward an executive officer for
    the achievement of one-time objectives in the relevant fiscal
    year, for example, success in raising capital or in acquiring
    and integrating a newly acquired business.    
    make the executive accountable for our achievement of annual
    financial performance goals; and
    reward the executive for superior performance in his or her role.   52




---



##### Table of Contents



and/or
          1 3
   53




---



##### Table of Contents



EBITDA

VestingPercentage

Percentage70%


25
%80%


50
%90%


75
%100%


100
%                54




---



##### Table of Contents



Summary
    Compensation Table
  Non-Equity Incentive Plan Compensation Bonus
  Non-EquityStock


Incentive Plan


All OtherName and Principal Position

Year


Salary ($)


Bonus ($)


Awards ($)(1)


Compensation ($)


Compensation ($)


Total ($)David Sutherland-Yoest


2009


$
583,800
(2)

$
186,816


$
721,415


$
396,984
(2)

$
38,443
(3)

$
1,927,458Chief Executive


2008



625,400



173,059



751,664



322,081



40,264



1,912,468Officer and President


2007



620,200











620,200



33,945



1,274,345Edwin D. Johnson


2009



400,000







181,800



272,000



43,941
(4)


897,741Executive Vice-President, Chief


2008



400,000



80,000



180,400



206,000



33,559



899,959Financial Officer and


2007



242,298











250,000



20,230



512,528Chief Accounting OfficerIvan R. Cairns


2009



385,308
(5)


123,299



227,250



262,009
(5)


44,197
(6)


1,042,063Executive Vice-President and


2008



412,764



114,219



225,500



212,573



46,994



1,012,050General Counsel


2007



409,332











409,332



32,633



851,297William P. Hulligan


2009



400,000



128,000



181,800



272,000



67,032
(7)


1,048,832Executive Vice-


2008



400,000



80,000



180,400



206,000



49,222



915,622President, U.S. Operations


2007



201,923



17,000







133,000



37,630



389,553Wayne R. Bishop


2009



196,275
(8)


31,525



43,300



66,991







338,091Senior Vice-


2008























President and Controller


2007























     (1)
    
    Does not reflect amounts actually received as compensation but
    represents the aggregate grant date fair value computed in
    accordance with FASB ASC Topic 718 based on the probable outcome
    of the performance conditions measured as of the grant date,
    assuming achievement of the maximum performance criteria. For a
    discussion of the assumptions used in the valuation see
    Notes 3 and 14 to the Consolidated Financial Statements,
    which are included elsewhere in this annual report. Amounts for
    2008 have been restated for consistency in presentation.(2)
    
    Pursuant to his employment agreement dated October 26,
    2005, Mr. Sutherland-Yoests base salary is fixed at
    $500,000 U.S. dollars per annum. However,
    Mr. Sutherland-Yoest is paid in Canadian dollars. The
    amount of his Canadian dollar base salary was fixed at an
    exchange rate in effect at the time his employment agreement was
    entered into. All amounts paid to Mr. Sutherland-Yoest in
    Canadian dollars are converted for reporting purposes to U.S.
    dollars at the average exchange rate in the applicable fiscal
    year. As a result of fluctuations in the exchange rate between
    the Canadian and U.S. dollar, although
    Mr. Sutherland-Yoests base salary was the 55




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##### Table of Contents



same in each of the three fiscal years described above, the U.S.
    dollar equivalent fluctuates. Non-equity incentive plan
    compensation payments are calculated based upon
    Mr. Sutherland-Yoests Canadian dollar salary and are
    paid in Canadian dollars and converted for reporting purposes to
    U.S. dollars at the average exchange rate in the applicable
    fiscal year.(3)
    
    Consists of car allowance and fuel and maintenance charges of
    C$25,724, club dues of C$7,200, other personal benefits of
    C$4,200, health care benefits and long term disability coverage
    of C$5,746 and premiums on life insurance for the benefit of
    Mr. Sutherland-Yoest of C$1,030. Canadian dollar amounts
    are converted to U.S. dollars for reporting purposes, at the
    average exchange rate in the fiscal year in which the amounts
    were paid.(4)
    
    Consists of car allowance of $14,400, matching contributions to
    our 401(k) Plan of $8,575 and health benefits and supplemental
    life and disability insurance premiums totaling $20,966.(5)
    
    Pursuant to his employment agreement dated January 5, 2004,
    Mr. Cairns base salary is fixed at $330,000 U.S.
    dollars. However, Mr. Cairns is paid in Canadian dollars.
    The amount of his Canadian dollar base salary is determined at
    an exchange rate fixed at the time his base salary was
    determined. All amounts paid to Mr. Cairns in Canadian
    dollars are converted for reporting purposes to U.S. dollars at
    the average exchange rate in the applicable fiscal year. As a
    result of fluctuations in the exchange rate between the Canadian
    and U.S. dollar, although Mr. Cairns base salary was
    the same in each of the three fiscal years described above, the
    U.S. dollar equivalent fluctuates. Non-equity incentive plan
    compensation payments are calculated based upon
    Mr. Cairns Canadian dollar salary and are paid in
    Canadian dollars and converted for reporting purposes to U.S.
    dollars at the average exchange rate in the applicable fiscal
    year.(6)
    
    Consists of car allowance and fuel and maintenance charges of
    C$25,811, club dues of C$3,688, matching contributions to the
    Canadian equivalent of our 401(k) Plan of C$10,750, health care
    benefits and long term disability coverage of C$8,165, and
    premiums on life insurance for the benefit of Mr. Cairns of
    C$2,057. Canadian dollar amounts are converted to U.S. dollars
    for reporting purposes at the average exchange rate in the
    fiscal year in which the amounts were paid.(7)
    
    Consists of car allowance of $14,400, matching contributions to
    our 401(k) Plan of $8,575, club dues of $14,568 and health
    benefit and supplemental life and disability insurance premiums
    of $29,489.(8)
    
    Pursuant to his employment agreement, Mr. Bishops
    base salary is fixed and paid in Canadian dollars and his bonus
    is fixed as a percentage of his Canadian dollar base salary.
    Amounts paid to Mr. Bishop in Canadian dollars are
    converted for reporting purposes to U.S. dollars at the average
    exchange rate in fiscal 2009.  Grants of
    Plan-Based Awards
   56




---



##### Table of Contents



Grant DateEstimated Possible Payouts

Estimated Possible Payouts Under

Fair ValueUnder Non-Equity Incentive

Equity Incentive Plan Awards

of StockPlan Awards

Threshold #

Target #

Maximum

and OptionGrant Date

Threshold ($)

Target ($)

of Units

of Units

# of Units

Awards ($)Name

(1)

(2)

(3)

(4)

(5)

(6)

(7)David Sutherland-Yoest



C$
266,667


C$
666,667March 15, 2009










18,750



75,000



75,000



324,750February 8, 2008










20,833



83,333



104,166



396,665Edwin D. Johnson




160,000



400,000March 15, 2009










5,000



20,000



20,000



86,600February 8, 2008










5,000



20,000



25,000



95,200Ivan R. Cairns



C$
176,000


C$
440,000March 15, 2009










6,250



25,000



25,000



108,250February 8, 2008










6,250



25,000



31,250



119,000William P. Hulligan




160,000



400,000March 15, 2009










5,000



20,000



20,000



86,600February 8, 2008










5,000



20,000



25,000



95,200Wayne R. Bishop



C$
45,000


C$
112,500March 15, 2009










2,500



10,000



10,000



43,300     (1)
    
    The grant date for equity incentive plan awards is the date the
    awards were approved by the Compensation Committee.(2)
    
    Represents the bonus amounts payable under our annual short term
    incentive plan if 100% of budgeted Adjusted EBIT is achieved,
    which is the minimum level that must be achieved for an annual
    cash bonus to be paid. For Mr. Sutherland-Yoest,
    Mr. Cairns and Mr. Bishop, the threshold is calculated
    based upon the Canadian dollar salary paid to each of them for
    the year.(3)
    
    Represents 100% of base salary for each of our named executive
    officers, other than Mr. Bishop, whose target is 50% of his
    base salary. For Mr. Sutherland-Yoest, Mr. Cairns and
    Mr. Bishop, the target is calculated based upon their
    Canadian dollar salary paid in the year. There is no maximum
    amount that may be paid to our executive officers as an annual
    cash bonus. The Compensation Committee has the discretion to
    award an amount greater or less than the target fixed in the
    employment agreement of each of our named executive officers.(4)
    
    Represents the number of restricted stock units that will vest
    if 70% of Annual Target EBITDA is achieved, the minimum level of
    achievement for restricted stock units to vest.(5)
    
    Represents 100% of the restricted stock units eligible to vest
    assuming 100% of Annual Target EBITDA is achieved.(6)
    
    Includes restricted stock units that did not vest based on
    performance in fiscal 2008 but which were eligible to catch up
    in 2009 if the EBITDA Percentage for the aggregate of fiscal
    2008 and 2009 was 100% of Annual Target EBITDA for 2008 and 2009.(7)
    
    Represents the grant date fair value of the restricted stock
    units calculated in accordance with FASB ASC Topic 718, assuming
    that 100% of budgeted Adjusted EBITDA is achieved in fiscal
    2009. Based on this assumption, no units eligible to catch up
    would vest in 2010 and therefore no value is ascribed to these
    units.   57




---



##### Table of Contents



58




---



##### Table of Contents



Numberof RSUsName

GrantedDavid Sutherland-Yoest


225,000Edwin D. Johnson


60,000Ivan R. Cairns


75,000William P. Hulligan


60,000Wayne R. Bishop


30,000      59




---



##### Table of Contents



RemainingEligible RSUsVested


from 2008Name

RSUs


GrantDavid Sutherland-Yoest


158,333



20,833Edwin D. Johnson


40,000



5,000Ivan R. Cairns


50,000



6,250William P. Hulligan


40,000



5,000Wayne R. Bishop


10,000



     Outstanding
    Equity Awards at Fiscal Year-End
    Stock
    Awards
  Equity IncentiveEquity Incentive

Plan Awards:Plan Awards:

Market or PayoutNumber of Unearned

Value ofShares,

Unearned Shares,Units or other

Units orRights that

Other Rights thatName

have not vested

have not vested(3)David Sutherland-Yoest


187,500
(1)

$
1,518,336225,000
(2)


2,049,750Edwin D. Johnson


45,000
(1)


364,40060,000
(2)


546,600Ivan R. Cairns


56,250
(1)


455,50075,000
(2)


683,250William P. Hulligan


45,000
(1)


364,40060,000
(2)


546,600Wayne R. Bishop


30,000
(2)


273,300     (1)
    
    Represents restricted stock units awarded in fiscal 2008 that
    are eligible to vest on March 15, 2010 and March 15,
    2011. If the EBITDA Percentage for the aggregate of the 2008,
    2009 and 2010 fiscal years is greater than 100%, the remaining
    RSUs that did not vest on March 15, 2009 (the Catch
    up Units) will vest in accordance with the aggregate
    EBITDA Percentage achieved in fiscal 2008, 2009 and 2010.(2)
    
    Represents restricted stock units awarded in fiscal 2009 that
    are eligible to vest on March 15, 2010, March 15, 2011
    and March 15, 2012 (as to
    331/3%
    on each date).(3)
    
    Based on the closing market price of our common stock on
    December 31, 2009 of $9.11 per share, assuming achievement
    of 100 % of Annual Target EBITDA in fiscal 2009 and subsequent
    fiscal years. Based on these assumptions, the Catch up Units
    would not vest and therefore have no value. 60




---



##### Table of Contents



Option
    Exercises and Stock Vested
    Stock
    Vested
  Number ofShares


ValueAcquired


Realizedon Vesting


on VestingName

(#)


($)(1)David Sutherland-Yoest


62,500


$
270,625Edwin D. Johnson


15,000



64,950Ivan R. Cairns


18,750



81,188William P. Hulligan


15,000



64,950Wayne R. Bishop






     (1)
    
    Based on the closing market price on the vesting date of $4.33
    per share.  Pension
    Benefits
    Non-Qualified
    Deferred Compensation Plans
    Potential
    Payments Upon Termination or Change of Control
    
    a change in the executives title or responsibilities that
    represents a material diminution of the executives
    position, status or authority;
    a reduction in the executives base salary;
    our material failure to provide the required benefit programs to
    the executive and his family;
    a failure to pay the executive a material amount of the
    compensation due to him; and
    failure to require a successor to assume the employment
    agreement with the executive. 61




---



##### Table of Contents



Termination by Reason ofFor Cause orWithout Cause or

Death or



Without GoodName

for Good Reason

Disability

Change of Control

ReasonDavid Sutherland-Yoest 
    Edwin D. Johnson
    Ivan R. Cairns

2 years

None

None where change of control occurred within 2 years
    preceding termination

1 yearWilliam P. Hulligan





Period from termination to effective date of change of control
    where change of control occurs within 1 year following
    terminationWayne R. Bishop

1 year

None

None where change of control occurred within 2 years
    preceding termination Period from termination to effective date
    of change of control where change of control occurs within
    1 year following termination

1 year       gross-up
     62




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##### Table of Contents




    the sale or lease or all or substantially all of our assets to a
    third party;
    a merger or consolidation with a third party where we are not
    the surviving entity and 50% or more of the shareholders
    following the merger are not the same as prior to the merger;
    the acquisition of more than 50% of our stock by a third party;
    a change of a majority of our directors from those in place
    prior to the adoption of the 2007 Plan; and
    our voluntary or involuntary dissolution.    Termination by Reason of

For Cause orWithout Cause or for



Change of

VoluntaryName

Good Reason(1)

Death or Disability(2)

Control

ResignationDavid Sutherland-Yoest

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time.Base salary for 3 years; 3 x average annual bonus over
    36 months. Medical, dental and vision coverage continuance
    for 3 years or until secure substantially equivalent
    employer- provided coverage.

Base salary for 3 years; 3 x average annual bonus over
    36 months. Medical, dental and vision coverage continuance
    for 3 years or until secure substantially equivalent
    employer-provided coverage.

Vesting of unvested restricted stock units. Lump sum payment of
    3 x base salary and 3 x average annual bonus. Medical, dental
    and vision coverage continuance for 3 years or until
    eligible for employer-provided benefits, whether or not
    comparable.

Exercise of warrants to purchase 166,666 shares of common
    stock$3,402,422(3)

$4,844,836(4)

$8,675,238(5)

$168,333(6)Edwin D. Johnson

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time.Base salary for 2 years; 2x annual cash bonus over
    24 months. Medical, dental and vision coverage continuance
    for 2 years or until eligible for substantially equivalent
    employer-provided coverage.

Base salary for 2 years; 2x annual cash bonus over
    24 months. Medical, dental and vision coverage continuance
    for 2 years or until eligible for substantially equivalent
    employer-provided coverage.

Vesting of unvested restricted stock units; Lump sum payment of
    2x base salary and 2x average annual bonus. Medical, dental and
    vision coverage continuance for 2 years or until eligible
    for employer-provided benefits, whether or not comparable.$1,392,710(7)

$1,757,110(8)

$2,818,065(9) 63




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##### Table of Contents



Termination by Reason of

For Cause orWithout Cause or for



Change of

VoluntaryName

Good Reason(1)

Death or Disability(2)

Control

ResignationIvan R. Cairns

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time.Base salary for 2 years; 2 x average annual bonus over
    24 months. Medical, dental and vision coverage continuance
    for 2 years or until eligible for substantially equivalent
    employer-provided coverage.

Base salary for 3 years; 3 x average annual bonus over
    36 months. Medical, dental and vision coverage continuance
    for 3 years or until eligible for substantially equivalent
    employer- provided coverage.

Vesting of unvested restricted stock units; Lump sum payment of
    3 x base salary, and 3 x average annual bonus. Medical, dental
    and vision coverage continuance for 3 years or until
    eligible for employer-provided benefits, whether or not
    comparable.$1,472,004(10)

$2,703,632(11)

$3,443,820(12)William P. Hulligan

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time.Base salary for 2 years; 2x annual cash bonus over
    24 months. Medical, dental and vision coverage continuance
    for 2 years or until eligible for substantially equivalent
    employer-provided coverage.

Base salary for 2 years; 2x annual cash bonus over
    24 months. Medical, dental and vision coverage continuance
    for 2 years or until eligible for substantially equivalent
    employer-provided coverage.

Vesting of unvested restricted stock units. Lump sum payment of
    2x base salary and 2x average annual bonus. Medical, dental and
    vision coverage continuance for 2 years or until eligible
    for employer-provided benefits, whether or not comparable.$1,537,392(13)

$1,901,792(14)

$3,100,246(15)Wayne R. Bishop

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time, earned annual cash bonus;

Unpaid base salary through date of termination, accrued, unpaid
    vacation time.Base salary for 1 year; 1x annual cash bonus over
    12 months. Medical, dental and vision coverage continuance
    for 1 year or until eligible for substantially equivalent
    employer-provided coverage.

Base salary for 1 year; 1x annual cash bonus over
    12 months. Medical, dental and vision coverage continuance
    for 1 year or until eligible for substantially equivalent
    employer-provided coverage.

Vesting of unvested restricted stock units. Lump sum payment of
    1x base salary and 1x average annual bonus. Medical, dental and
    vision coverage continuance for 1 year or until eligible
    for employer-provided benefits, whether or not comparable.$298,773(16)

$389,873(17)

$572,073(18)     (1)
    
    On termination other than for death or disability or change of
    control, all unvested restricted stock units are forfeited.(2)
    
    On termination due to death, disability or retirement effective
    December 31, 2009, all eligible unvested restricted stock
    units would remain outstanding until March 15, 2010 and
    would vest at that time based upon 64




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##### Table of Contents



the level of achievement of Annual Target EBITDA in fiscal 2009.
    All unvested restricted stock units would be automatically
    forfeited at that time.(3)
    
    Consists of C$2,000,000 in base salary, C$1,861,146 in average
    bonus incentives, C$24,228 for continued health care benefits
    converted to U.S. dollars at the average exchange rate in fiscal
    2009. Although the payments of salary and bonus would be payable
    in equal installments over 3 years, these amounts have not
    been present valued.(4)
    
    Consists of C$2,000,000 in base salary, C$1,861,146 in average
    bonus incentives, C$24,228 for continued health care benefits
    converted to U.S. dollars at the average exchange rate in fiscal
    2009 and $1,442,414 on the vesting of 158,333 restricted stock
    units. Although the payments of salary and bonus would be
    payable in equal installments over 3 years, these amounts
    have not been present valued.(5)
    
    In addition to the amounts described in Footnote 3 for
    salary, bonus and benefits, includes, $3,757,875 for the vesting
    of 412,500 restricted stock units at $9.11 per share, the
    closing price of our common shares on December 31, 2009 and
    tax gross up of $1,514,941.(6)
    
    Represents the difference between the closing price of our stock
    on December 31, 2009 of $9.11 and the warrant exercise
    price of $8.10 per share.(7)
    
    Consists of $800,000 in base salary, $558,000 in average bonus
    incentives and $34,710 for continued health care benefits.
    Although the payments of salary and bonus would be payable in
    equal installments over 2 years, these amounts have not
    been present valued.(8)
    
    Consists of $800,000 in base salary, $558,000 in average bonus
    incentives, $34,710 for continued health care benefits and
    $364,400 on the vesting of 40,000 restricted stock units.
    Although the payments of salary and bonus would be payable in
    equal installments over 2 years, these amounts have not
    been present valued.(9)
    
    In addition to the amounts described in Footnote 7 for
    salary, bonus and benefits, includes $956,550 for the vesting of
    105,000 restricted stock units at $9.11 per share, the closing
    price of our common shares on December 31, 2009, and tax
    gross up of $468,805.(10)
    
    Consists of C$880,000 in base salary and C$788,355 in average
    bonus incentives and C$12,590 for continued health care
    benefits, converted to U.S. dollars at the average exchange rate
    in fiscal 2009. Although the payments of salary and bonus would
    be payable in equal installments over 2 years, these
    amounts have not been present valued(11)
    
    Consists of C$1,320,000 in base salary and C$1,228,355 in
    average bonus incentives, C$18,885 for continued health care
    benefits, converted to U.S. dollars at the average exchange rate
    in fiscal 2009 and $455,500 on the vesting of 50,000 restricted
    stock units. Although the payments of salary and bonus would be
    payable in equal installments over 3 years, these amounts
    have not been present valued.(12)
    
    In addition to the amounts described in Footnote 11 for salary,
    bonus and benefits, includes $1,195,688 for the vesting of
    131,250 restricted stock units at $9.11 per share, the closing
    price of our common shares on December 31, 2009.(13)
    
    Consists of $800,000 in base salary, $686,000 in average bonus
    incentives and $51,392 for continued health care benefits.
    Although the payments of salary and bonus would be payable in
    equal installments over 2 years, these amounts have not
    been present valued(14)
    
    Consists of $800,000 in base salary, $686,000 in average bonus
    incentives and $51,392 for continued health care benefits and
    $364,400 on the vesting of 40,000 restricted stock units.
    Although the payments of salary and bonus would be payable in
    equal installments over 2 years, these amounts have not
    been present valued.(15)
    
    In addition to the amounts described in Footnote 13 for
    salary, bonus and benefits, includes$956,550 for the vesting of
    105,000 restricted stock units at $9.11 per share, the closing
    price of our common shares on December 31, 2009, and tax
    gross up of $606,304.(16)
    
    Consists of C$225,000 in base salary, C$112,500 in average bonus
    incentives and C$3,682 for continued health care benefits,
    converted to U.S. dollars at the average exchange rate in fiscal
    2009.(17)
    
    Consists of C$225,000 in base salary, C$112,500 in average bonus
    incentives and C$3,682 for continued health care benefits,
    converted to U.S. dollars at the average exchange rate in fiscal
    2009 and $91,100 on the vesting of 10,000 restricted stock units. 65




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##### Table of Contents



(18)
    
    In addition to the amounts described in Footnote 16 for
    salary, bonus and benefits, includes $273,300 on the vesting of
    30,000 restricted stock units at $9.11 per share, the closing
    price of our common shares on December 31, 2009.  Directors
    Compensation
      Fees Earned

Stockor Paid in

AwardsName

Cash ($)

($)(1)

Total ($)Michael B. Lazar

$
33,500


$
22,725


$
56,225George E. Matelich


40,500



22,725



63,225Jack E. Short


55,500



22,725



78,225Gary W. DeGroote


23,000



15,150



38,150Lucien Rémillard


20,500



15,150



35,650Michael H. DeGroote


24,000



15,150



39,150Wallace L. Timmeny


49,500



15,150



64,650Michael J. Verrochi


45,500



15,150



60,650Charles E. McCarthy


9,500




(2)


9,500     (1)
    
    Does not represent amounts actually paid to our directors.
    Represents the aggregate grant date fair value computed in
    accordance with FASB ASC Topic 718 based on the probable outcome
    of the performance conditions measured as of the grant date,
    assuming achievement of the maximum performance criteria fixed
    for fiscal 2009. For a discussion of the assumptions used in the
    valuation see Notes 3 and 14 to the Consolidated Financial
    Statements, which are included elsewhere in this annual report.(2)
    
    All restricted stock unit awards made to Mr. McCarthy were
    forfeited when Mr. McCarthy was not re-elected to the Board
    in June 2009.  Cash
    Compensation
    Equity
    Compensation
     66




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##### Table of Contents



1 3
    Governance
    Committee
    Board of
    Directors Role in Risk Oversight
    Management
    of Compensation Risk
    Compensation
    Committee Interlocks and Insider Participation
   67




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##### Table of Contents



Compensation
    Committee Report
      
  Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    (c)Number of SecuritiesRemaining Available for(a)





Future Issuance UnderNumber of Securities





Equity Compensationto be Issued Upon


(b)


Plans (ExcludingExercise of


Weighted-Average


Securities to be IssuedOutstanding


Exercise Price of


upon Exercise ofOptions, Warrants


Outstanding Options,


Outstanding Options,Plan Category

and Rights


Warrants and Rights


Warrants or Rights)Equity compensation plans approved by security holders


2,254,858
(1)

$
8.59



2,771,417
(2)Equity compensation plans not approved by security holders


333,333
(3)


8.10



Total


2,588,191







2,771,417    (1)
    
    Consists of 1,119,483 outstanding options and 1,135,375
    outstanding restricted stock units.(2)
    
    Pursuant to our 2009 Plan, the number of common shares that may
    be issued as awards under the Plan may not exceed in the
    aggregate 4,500,000 shares.(3)
    
    Warrants to purchase 333,333 shares of our common stock, at
    an exercise price of $8.10 per share, were granted to David
    Sutherland-Yoest in September 2001 as a term of the commencement
    of his employment. Subsequently, Mr. Sutherland-Yoest
    transferred 166,667 of these warrants to his wife and daughter.
    All of the warrants have vested and will expire in September
    2011. The warrants are exercisable until their expiration so
    long as Mr. Sutherland-Yoest is an employee. In the event
    of a change of control, or if Mr. Sutherland-Yoests
    employment is terminated by reason of death, disability or by us
    without cause, the warrants continue to be exercisable as if
    Mr. Sutherland-Yoest had remained an employee, through
    their expiration date. 68




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##### Table of Contents



Shares Beneficially
    Owned
  Percentage ofNumber of

Total IssuedCommon

CommonName of Beneficial Owner(1)

Shares

SharesWestbury (Bermuda) Ltd.(2)


12,607,365



27.3.
%Kelso & Company, L.P.(3)


5,278,070



10.9
%    (1)
    
    Beneficial ownership is determined in accordance with the rules
    of the Securities and Exchange Commission. In general, a person
    who has voting power or investment power with respect to
    securities is treated as a beneficial owner of those securities.
    Shares of common stock subject to options or warrants currently
    exercisable or exercisable within 60 days of
    February 1, 2010 count as outstanding for computing the
    percentage beneficially owned by the person holding these
    options or warrants.(2)
    
    The stockholder of Westbury (Bermuda) Ltd. is Westbury Trust.
    The trustees of Westbury Trust are Jim Watt, Gary W. DeGroote
    and Rick Burdick. The address for Westbury (Bermuda) Ltd. is
    Victoria Hall, 11 Victoria Street, P.O. Box HM 1065,
    Hamilton, Bermuda, HMEX.(3)
    
    Consists of 2,605,263 shares of common stock owned by Kelso
    Investment Associates VI, L.P. and 2,145,000 shares of
    common stock issuable upon the exercise of warrants issued to
    Kelso Investment Associates VI, L.P. that expire on May 6,
    2010 and 289,474 shares of common stock owned by KEP VI,
    LLC and 238,333 shares of common stock issuable upon the
    exercise of warrants issued to KEP VI, LLC that expire on
    May 6, 2010. Kelso Investment Associates VI, L.P. and KEP
    VI, LLC are affiliates of Kelso & Company, L.P. The
    address of Kelso & Company, L.P. is 320 Park Avenue,
    24th Floor, New York, N.Y. 10022.    % ofOutstanding


SharesName

Shares(1)


(2)David Sutherland-Yoest(3)


1,380,825



3.0
%Lucien Rémillard(4)


1,190,482



2.6
%Gary W. DeGroote(5)


759,583



1.6
%George E. Matelich(6)


255,107




*Michael J. Verrochi


204,829




*William P. Hulligan


155,000




*Edwin D. Johnson


30,000




*Ivan R. Cairns


19,583




*Wallace L. Timmeny


11,216




*Michael H. DeGroote


8,333




*Michael B. Lazar


6,729




*Jack E. Short


6,208




*Wayne R. Bishop







*All executive officers and directors as a group (13 persons)


4,027,895



8.6
%     *
    
    Less than one (1%) percent.(1)
    
    In general, a person who has voting power or investment power
    with respect to securities is treated as a beneficial owner of
    those securities. Shares of common stock subject to options or
    warrants currently 69




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##### Table of Contents



exercisable or exercisable within 60 days of
    February 22, 2010 count as outstanding for computing the
    percentage beneficially owned by the person holding these
    options or warrants.(2)
    
    Percentages based upon 46,253,107 shares of common stock
    outstanding as of February 1, 2010.(3)
    
    Consists of 649,832 shares of common stock owned by D.S.Y.
    Investments Ltd., of which Mr. Sutherland-Yoest is the sole
    director and stockholder, as well as 314,328 shares of
    common stock owned by Mr. Sutherland-Yoest personally,
    166,666 shares of common stock issuable upon the exercise
    of currently exercisable warrants to purchase common shares held
    by Mr. Sutherland-Yoest and 166,666 shares of common
    stock and 83,333 shares of common stock issuable upon
    exercise of currently exercisable warrants owned by
    Mr. Sutherland-Yoests wife which
    Mr. Sutherland-Yoest may be deemed to beneficially own.
    Mr. Sutherland-Yoest disclaims beneficial ownership with
    respect to the shares and warrants to purchase shares owned by
    his wife.(4)
    
    Consists of 500,000 shares of common stock owned by Maybach
    Corporation, 492,832 shares of common stock owned by The
    Victoria Bank (Barbados) Incorporated and 197,650 common shares
    owned by Mr. Rémillard personally.
    Mr. Rémillard is the controlling stockholder of
    Maybach Corporation and is indirectly the controlling
    stockholder of The Victoria Bank (Barbados) Incorporated, and is
    deemed to beneficially own the common and exchangeable shares
    owned by each such entity. Mr. Rémillard disclaims
    beneficial ownership of the common and exchangeable shares owned
    by The Victoria Bank (Barbados) Incorporated and Maybach
    Corporation.(5)
    
    Consists of 758,333 shares of common stock owned by GWD
    Management Inc. and 1,250 shares of common stock owned
    personally by Mr. DeGroote. Mr. DeGroote is the
    controlling stockholder and director of GWD Management Inc.(6)
    
    Consists of 254,807 shares of common stock owned by
    Mr. Matelich and 300 shares of common stock owned by
    Mr. Matelichs children. All of the shares of common
    stock owned by Mr. Matelich personally are pledged to Smith
    Barney (a division of Citigroup Global Markets, Inc.).
    Mr. Matelich disclaims beneficial ownership of the shares
    owned by his children. Mr. Matelich is a Managing Director
    of Kelso & Company, L.P. Affiliates of
    Kelso & Company, L.P. own 2,894,737 shares of our
    common stock and currently exercisable warrants to purchase
    2,383,333 shares of common stock. Mr. Matelich
    disclaims beneficial ownership of the shares owned by affiliates
    of Kelso & Company, L.P.    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence  Regulation S-K.
 70




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##### Table of Contents



father-in-law
  1 2
   71




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##### Table of Contents



Item 14.
    Principal
    Accounting Fees and Services    Audit
    Fees
    Audit
    Related Fees
    Tax
    Fees
    All
    Other Fees
    Pre-Approval
    Policies and Procedures
   72




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##### Table of Contents



PART IV  Item 15.
    Exhibits,
    Financial Statement Schedules  Consolidated
    Financial Statements
  Consolidated Financial Statements
                Financial Statement Schedules
      Exhibits
    2
.1

Plan of Arrangement under Section 182 of the Business
    Corporations Act (Ontario). (Incorporated by reference to
    Exhibit 2.1 to
    Form 10-K
    (No. 000-25955)
    filed March 16, 2005).2
.2

Agreement and Plan of Merger dated as of November 11, 2009
    by and among IESI-BFC Ltd., IESI-BFC Merger Sub, Inc. and Waste
    Services, Inc. (Incorporated by reference to Exhibit 2.1 to
    Form 8-K
    (No. 000-25955)
    filed November 16, 2009).3
.1

Amended and Restated Certificate of Incorporation of Waste
    Services, Inc. (Incorporated by reference to Exhibit 3.1 to
    Form 8-K
    (No. 000-25955)
    filed August 2, 2004).3
.2

Certificate of Amendment to Amended and Restated Certificate of
    Incorporation of Waste Services, Inc. effective June 30,
    2006 (Incorporated by reference to Exhibit 3.1 to
    Form 8-K
    (No. 000-25955)
    filed July 5, 2006).3
.3

Provisions for Exchangeable Shares of Waste Services (CA) Inc.
    (Incorporated by reference to Exhibit 3.2 to
    Form 10-K
    (No. 000-25955)
    filed March 16, 2005).3
.4

Amendment to Provisions for Exchangeable Shares of Waste
    Services (CA) Inc. (Incorporated by reference to
    Exhibit 3.3 to
    Form 8-K
    (No. 000-25955)
    filed July 5, 2006).3
.5

Certificate of Designation of Special Voting Preferred Stock of
    Waste Services, Inc. (Incorporated by reference to
    Exhibit 3.2 to
    Form 8-K
    (No. 000-25955)
    filed August 2, 2004).3
.6

Amended Certificate of Designations of Special Voting Preferred
    Stock of Waste Services, Inc. (Incorporated by reference to
    Exhibit 3.2 to
    Form 8-K
    (No. 000-25955)
    filed July 5, 2006).3
.7

By-law No. 1 of Waste Services, Inc. (Incorporated by
    reference to Exhibit 3.3 to
    Form 8-K
    (No. 000-25955)
    filed August 2, 2004).3
.8

Certificate of Designations of Waste Services, Inc.
    (Incorporated by reference to Exhibit 1.3 to
    Form 20-F
    (No. 000-25955)
    filed July 15, 2003).3
.9

Amended Certificate of Designations of Waste Services, Inc.
    (Incorporated by reference to Exhibit 4.1 to
    Form 8-K
    (No. 000-25955)
    filed May 10, 2004).4
.1

Preferred Subscription Agreement dated as of May 6, 2003,
    among Waste Services, Inc., Capital Environmental Resource Inc.,
    Kelso Investment Associates VI, L.P. and KEP VI LLC
    (Incorporated by reference to Exhibit 4.4 to
    Form 20-F
    (No. 000-25955)
    filed July 15, 2003). 73




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##### Table of Contents



4
.2

Amending Agreement No. 2 to Preferred Subscription
    Agreement dated June 8, 2004 (Incorporated by reference to
    Exhibit 4.1 to
    Form 8-K
    (No. 000-25955)
    filed June 9, 2004).4
.3

Warrant Agreement dated as of May 6, 2003, between Waste
    Service Inc., and certain holders of the Preferred Stock
    (Incorporated by reference to Exhibit 4.6 to
    Form 20-F
    (No. 000-25955)
    filed July 15, 2003).4
.4

Warrant, dated July 27, 2001 issued by us to David
    Sutherland-Yoest (Incorporated by reference to Exhibit 4.8
    to
    Form 20-F
    (No. 000-25955)
    filed July 12, 2002).4
.5

Form of Warrant to Purchase Common Shares by and between Capital
    Environmental Resource Inc. and certain investors. (Incorporated
    by reference to Exhibit 4.4 to
    Form 8-K
    (No. 000-25955)
    filed May 10, 2004).4
.6

Indenture regarding 9
    1/2% Senior
    Subordinated Notes among Waste Services, Inc., the Guarantors
    and Wells Fargo Bank, National Association, as trustee, dated as
    of April 30, 2004 (Incorporated by reference to
    Exhibit 4.3 to
    Form 8-K
    (No. 000-25955)
    filed May 10, 2004).4
.7

Supplemental Indenture dated as of August 8, 2005 to the
    Notes Indenture among Sanford Recycling and Transfer, Inc.,
    Waste Services, Inc., the other guarantors and Wells Fargo Bank,
    National Association, as Trustee (Incorporated by reference to
    Exhibit 4.2 to
    Form S-4
    (No. 333-127444)
    filed August 11, 2005).4
.12

Supplemental Indenture dated as of June 30, 2006 to the
    Notes Indenture among Sun Country Materials, LLC., Waste
    Services, Inc., the other guarantors and Wells Fargo Bank,
    National Association, as Trustee. (Incorporated by reference to
    Exhibit 4.18 to
    Form 10-Q
    (No. 000-25955)
    filed August 1, 2006).4
.13

Supplemental Indenture dated as of June 30, 2006, to the
    Notes Indenture among Taft Recycling, Inc., Waste Services,
    Inc., the other guarantors and Wells Fargo Bank, National
    Association, as Trustee. (Incorporated by reference to
    Exhibit 4.17 to
    Form 10-Q
    (No. 000-25955)
    filed August 1, 2006).4
.14

Supplemental Indenture dated as of January 5, 2007 to the
    Notes Indenture among SLD Landfill, Inc., Pro Disposal, Inc.,
    Waste Services, Inc., the other guarantors and Wells Fargo Bank,
    National Association, as Trustee (Incorporated by reference to
    Exhibit 4.16 to
    Form 10-K
    (000-25955)
    filed March 5, 2007).4
.15

Supplemental Indenture, dated as of April 12, 2007, among
    Freedom Recycling Holdings, U.S.A. Recycling Holdings L.L.C.,
    U.S.A. Recycling L.L.C., Waste Services, Inc., the other
    guarantors and Wells Fargo Bank, National Association, as
    Trustee (Incorporated by reference to Exhibit 4.1 to
    Form 10-Q
    (000-25955)
    filed July 26, 2007).4
.16

Supplemental Indenture, dated as of December 30, 2008,
    among RIP, Inc., Waste Services, Inc., the other guarantors and
    Wells Fargo Bank, National Association, as Trustee (Incorporated
    by reference to Exhibit 4.3 to
    Form 10-Q
    (000-25955)
    filed October 29, 2009).4
.17

Supplemental Indenture dated as of October 6, 2008 among
    Waste Services, Inc., the guarantors and Wells Fargo Bank,
    National Association, as Trustee (Incorporated by reference to
    Exhibit 4.1 to
    Form 8-K
    (No. 000-25955)
    filed October 10, 2008).4
.18

Supplemental Indenture dated as of October 8, 2008 among
    Capital Environmental Holdings Company, Waste Services (CA)
    Inc., Ram-Pak Compaction Systems Ltd., Waste Services, Inc., the
    other guarantors and Wells Fargo Bank, National Association, as
    Trustee (Incorporated by reference to Exhibit 4.2 to
    Form 8-K
    (No. 000-25955)
    filed October 10, 2008).4
.19

Support Agreement dated July 31, 2004 among Waste Services,
    Inc. Capital Environmental Holdings Company and Capital
    Environmental Resource Inc. (Incorporated by reference to
    Exhibit 4.10 to
    Form 10-K
    (No. 000-25955)
    filed March 16, 2005).4
.20

Form of Purchase Agreement dated as of September 16, 2009
    among Waste Services, Inc. and Barclays Capital Inc.
    (Incorporated by reference to Exhibit 20.1 to
    Form 8-K
    (No. 000-25955
    filed September 21, 2009).4
.21

Form of Registration Rights Agreement dated September 16,
    2009 among Waste Services, Inc. as Issuer and Barclays Capital,
    Inc. as representatives of the Initial Purchasers (Incorporated
    by reference to Exhibit 20.2 to
    Form 8-K
    (No. 000-25955
    filed September 21, 2009).10
.1

Capital Environmental Resource Inc. 1999 Stock Option Plan
    (Incorporated by reference to Exhibit 4 to
    Schedule 13D
    (No. 005-57445)
    dated February 5, 2002 and filed by certain holders of the
    Companys Common Shares with the Commission on
    February 15, 2002). 74




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##### Table of Contents



10
.2

2007 Waste Services Inc. Equity and Performance Incentive Plan,
    as amended (Incorporated by reference to Exhibit 10.2 to
    Form 10-K
    for the year ended December 31, 2008
    (No. 000-25955),
    filed February 26, 2009).10
.3

Credit Agreement dated as of October 8, 2008 among Waste
    Services, Inc., Waste Services (CA) Inc., the several lenders
    from time to time party hereto, Barclays Capital and Banc of
    America Securities, LLC as Joint Lead Arrangers and Joint Lead
    Bookrunners, , Bank of America, NA as Syndication Agent, Bosic
    Inc., Suntrust Bank and The Bank of Nova Scotia as
    Co-documentation Agents and The Bank of Nova Scotia as Canadian
    Agent and Canadian Collateral Agent (Incorporated by reference
    to Exhibit 99.2 to
    Form 8-K
    (No. 000-25955)
    filed October 10, 2008).10
.4

Employment Agreement dated as of October 26, 2005 between
    Waste Services, Inc. and David Sutherland-Yoest (Incorporated by
    reference to Exhibit 10.1 to
    Form 10-Q
    (No. 000-25955)
    filed October 31, 2005).10
.5

Employment Agreement dated as of July 1, 2004 between Waste
    Services, Inc. and Charles A. Wilcox (Incorporated by reference
    to Exhibit 10.13 to
    Form 10-K
    (No. 000-25955)
    filed March 16, 2004).10
.6

Employment Agreement dated January 5, 2004, between Capital
    Environmental Resource Inc., Waste Services, Inc. and Ivan R.
    Cairns. (Incorporated by reference to Exhibit 10.1 to
    Form 10-Q
    (No. 000-25955),
    filed May 17, 2004).10
.7

Employment Agreement dated as of March 12, 2007 between
    Waste Services, Inc. and Edwin D. Johnson (Incorporated by
    reference to Exhibit No. 99.2 to
    Form 8-K
    (No
    000-25955)
    filed March 12, 2007).10
.8

Employment Agreement dated as of August 23, 2007 between
    Waste Services, Inc. and William P. Hulligan (Incorporated by
    reference to Exhibit 10.1 to
    Form 10-Q
    (No
    000-25955)
    filed November 1, 2007).10
.9

Employment Agreement dated as of July 22, 2008 between
    Waste Services, Inc. and Brian A. Goebel (Incorporated by
    reference to Exhibit 10.1 to
    Form 10-Q
    (No. 000-25955)
    filed July 25, 2008).10
.10

Employment Agreement dated as of December 22, 2008 between
    Waste Services, Inc. and Wayne R. Bishop (Incorporated by
    reference to Exhibit 99.1 to
    Form 8-K
    (No. 005-25955)
    filed on January 7, 2009).10
.11

Form of Stock Option Agreement under the 2007 Equity and
    Performance Incentive Plan (Incorporated by reference to
    Exhibit 10.19 to
    Form 10-K
    (No. 000-25955)
    filed March 11, 2008).10
.12

Form of Restricted Stock Unit Agreement under the 2007 Equity
    and Performance Incentive Plan (Incorporated by reference to
    Exhibit 10.20 to
    Form 10-K
    (No. 000-25955)
    filed March 11, 2008).10
.13

Asset Purchase Agreement dated as of October 5, 2009 by and
    among Republic Services of Florida, LP, Republic Services, Inc.,
    Waste Services of Florida, Inc. and Waste Services, Inc.
    (Incorporated by reference to Exhibit 99.1 to
    Form 8-K
    (No. 000-25955)
    filed October 6, 2009).10
.14

First Amendment to Credit Agreement and First Amendment to
    Guarantee and US Collateral Agreement dated as of
    September 1, 2009 among Waste Services (CA) Inc., Waste
    Services Inc., the representatives of the Borrowers and Barclays
    Bank, Plc, as administrative agent for the lenders (Incorporated
    by reference to Exhibit 20.1 to
    Form 8-K
    (No. 000-25955)
    filed September 16, 2009).10
.15

Separation Agreement with Charles Wilcox (Incorporated by
    reference to Exhibit 10.1 to
    Form 10-Q
    (000-25955)
    filed October 29, 2009).14
.1

Code of Ethics. (Incorporated by reference to Exhibit 14.1
    to
    Form 10-K
    for the year ended December 31, 2007
    (No. 000-25955),
    filed March 11, 2008).18
.1

Letter regarding change in accounting principle executed by BDO
    Dunwoody LLP on May 12, 2004 (Incorporated by reference to
    Exhibit 18.1 to
    Form 10-Q
    for the quarterly period ended March 31, 2004
    (No. 000-25955)
    filed May 17, 2004).21
.1

List of Subsidiaries.23
.1

Consent of BDO Seidman, LLP.31
.1

Certification pursuant to
    Rule 15d-14(a)
    under the Securities Exchange Act of 1934 as amended of David
    Sutherland-Yoest, Chief Executive Officer.31
.2

Certification pursuant to
    Rule 15d-14(a)
    under the Securities Exchange Act of 1934 as amended of Edwin D.
    Johnson, Chief Financial Officer.32
.1

Certification of Chief Executive Officer and Chief Financial
    Officer pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the U.S. Sarbanes-Oxley Act of
    2002.  75




---



##### Table of Contents



SIGNATURES
      DAVID
    SUTHERLAND-YOEST
   President, Chief Executive
 Officer and Director
      Signature

Title

Date/s/  DAVID
    SUTHERLAND-YOESTDavid
    Sutherland-Yoest

President, Chief Executive Officer and Director

February 23, 2010/s/  EDWIN
    D. JOHNSONEdwin
    D. Johnson

Executive Vice President, Chief Financial Officer and Chief
    Accounting Officer

February 23, 2010/s/  GARY
    W. DEGROOTEGary
    W. DeGroote

Director

February 23, 2010/s/  MICHAEL
    H. DEGROOTEMichael
    H. DeGroote

Director

February 23, 2010/s/  MICHAEL
    B. LAZARMichael
    B. Lazar

Director

February 23, 2010/s/  GEORGE
    E. MATELICHGeorge
    E. Matelich

Director

February 23, 2010/s/  LUCIEN
    RÉMILLARDLucien
    Rémillard

Director

February 23, 2010/s/  JACK
    E. SHORTJack
    E. Short

Director

February 23, 2010/s/  WALLACE
    L. TIMMENYWallace
    L. Timmeny

Director

February 23, 2010/s/  MICHAEL
    J. VERROCHIMichael
    J. Verrochi

Director

February 23, 2010  1




---



##### 



INDEX TO
    CONSOLIDATED FINANCIAL STATEMENTS
   
 Managements Report on Internal Control Over
    Financial Reporting


F-2Reports of Independent Registered Public
    Accounting Firm


F-3Consolidated Balance Sheets


F-5Consolidated Statements of Operations and
    Comprehensive Income (Loss)


F-6Consolidated Statements of Shareholders
    Equity


F-7Consolidated Statements of Cash Flows


F-8Notes to Consolidated Financial Statements


F-9   F-1




---



##### Table of Contents



MANAGEMENTS
    REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING  Rules 13a-15(f) 15d-15(f)
  Internal Control 
    Integrated Framework
   F-2




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM     Internal Control  Integrated Framework
            
    F-3




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
             Internal Control  Integrated Framework
  
    F-4




---



##### Table of Contents



WASTE
    SERVICES, INC.CONSOLIDATED BALANCE SHEETS (In thousands of U.S. dollars, except
    share amounts)
    As of December 31,
  2009


2008ASSETSCurrent assets:Cash

$
3,699


$
7,227Accounts receivable (net of allowance for doubtful accounts of
    $511 and $631 as of December 31, 2009 and 2008,
    respectively)


60,808



52,062Prepaid expenses and other current assets


19,816



13,672Total current assets


84,323



72,961Property and equipment, net


204,505



188,800Landfill sites, net


196,342



196,632Goodwill and other intangible assets, net


419,439



372,886Other assets


10,383



9,648Total assets

$
914,992


$
840,927LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable

$
31,039


$
19,341Accrued expenses and other current liabilities


63,807



62,802Short-term financing and current portion of long-term debt


20,059



11,102Total current liabilities


114,905



93,245Long-term debt


381,393



360,967Deferred income taxes


39,912



32,298Accrued closure, post-closure and other obligations


19,434



19,399Total liabilities


555,644



505,909Shareholders equity:Common stock $0.01 par value: 166,666,666 shares
    authorized, 46,253,107 and 43,985,436 shares issued and
    outstanding as of December 31, 2009 and December 31,
    2008, respectively


462



439Additional paid-in capital


502,049



512,942Accumulated other comprehensive income


47,988



38,221Accumulated deficit


(191,151
)


(216,584
)Total shareholders equity


359,348



335,018Total liabilities and shareholders equity

$
914,992


$
840,927    F-5




---



##### Table of Contents



WASTE
    SERVICES, INC.CONSOLIDATED STATEMENTS OF OPERATIONS AND
    COMPREHENSIVE INCOME (LOSS) (In thousands of U.S. dollars, except per
    share amounts)
    For the Years Ended December 31,
  2009


2008


2007Revenue

$
434,515


$
473,029


$
461,447Operating and other expenses:Cost of operations (exclusive of depreciation, depletion and
    amortization)


277,465



309,121



301,573Selling, general and administrative expense (exclusive of
    depreciation, depletion and amortization)


58,341



66,474



64,239Deferred acquisition costs






10,267



Depreciation, depletion and amortization


44,578



45,348



54,891Loss (gain) on sale of property and equipment, foreign exchange
    and other


(2,570
)


160



(69
)Income from operations


56,701



41,659



40,813Interest expense


30,967



37,432



40,679Change in fair value of warrants


434







Income from continuing operations before income taxes


25,300



4,227



134Income tax provision


11,246



6,183



14,437Income (loss) from continuing operations


14,054



(1,956
)


(14,303
)Income from discontinued operations, net of income tax provision
    of $266 for the year ended December 31, 2008 and nil for
    all other years






409



2,796Gain (loss) on sale of discontinued operations, net of income
    tax provision of $7,255 for the year ended December 31,
    2008 and nil for all other years






11,110



(11,607
)Net income (loss)

$
14,054


$
9,563


$
(23,114
)Basic and diluted earnings (loss) per share:Earnings (loss) per share  continuing operations

$
0.30


$
(0.04
)

$
(0.31
)Earnings (loss) per share  discontinued operations






0.25



(0.19
)Earnings (loss) per share  basic and diluted

$
0.30


$
0.21


$
(0.50
)Weighted average common shares outstanding Basic


46,218



46,079



46,007Diluted


46,325



46,079



46,007Consolidated Statements of Comprehensive Income (Loss)Net income (loss)

$
14,054


$
9,563


$
(23,114
)Foreign currency translation adjustment


9,767



(27,796
)


30,816Comprehensive income (loss)

$
23,821


$
(18,233
)

$
7,702    F-6




---



##### Table of Contents



WASTE
    SERVICES, INC.CONSOLIDATED STATEMENTS OF SHAREHOLDERS
    EQUITY
  Waste





AccumulatedServices, Inc.


Additional


Other





TotalCommon Stock


Paid-in


Comprehensive


Accumulated


ShareholdersShares


Amount


Capital


Income


Deficit


Equity(In thousands of U.S. dollars and share amounts)Balance, December 31, 2006


43,869


$
438


$
506,751


$
35,201


$
(203,033
)

$
339,357Exercise of options and warrants


103



1



690











691Stock-based compensation










2,845











2,845Foreign currency translation adjustment














30,816







30,816Net loss


















(23,114
)


(23,114
)Balance, December 31, 2007


43,972



439



510,286



66,017



(226,147
)


350,595Stock-based compensation










2,596











2,596Exercise of warrants


7







60











60Conversion of exchangeable shares


6



















Foreign currency translation adjustment














(27,796
)






(27,796
)Net income


















9,563



9,563Balance, December 31, 2008 as previously reported


43,985



439



512,942



38,221



(216,584
)


335,018Cumulative effect ofreclassification of warrants










(13,774
)






11,379



(2,395
)Balance, January 1, 2009 as adjusted


43,985



439



499,168



38,221



(205,205
)


332,623Stock-based compensation


172



2



2,902











2,904Conversion of exchangeable shares


2,096



21



(21
)










Foreign currency translation adjustment














9,767







9,767Net income


















14,054



14,054Balance, December 31, 2009


46,253


$
462


$
502,049


$
47,988


$
(191,151
)

$
359,348    F-7




---



##### Table of Contents



WASTE
    SERVICES, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands of U.S. dollars)
    For the Years Ended December 31,
  2009


2008


2007Cash flows from operating activities:Net income (loss)

$
14,054


$
9,563


$
(23,114
)Adjustments to reconcile net income (loss) to net cash flows
    from operating activities:Loss (income) from discontinued operations, net of tax






(11,519
)


8,811Depreciation, depletion and amortization


44,578



45,348



54,891Amortization of debt issue costs and discounts


3,574



5,377



2,362Deferred income tax provision (benefit)


5,525



(2,577
)


5,318Non-cash stock-based compensation expense


2,904



2,596



2,845Change in fair value of warrants


434







Restructuring and severance costs expensed, exclusive of
    stock-based compensation






5,286



3,252Landfill development project costs expensed






10,267



Loss (gain) on sale of property and equipment and other non-cash
    items


(1,820
)


105



1,164Changes in operating assets and liabilities (excluding the
    effects of acquisitions and dispositions):Accounts receivable


(1,196
)


8,241



(1,747
)Prepaid expenses and other current assets


(3,580
)


2,330



(1,581
)Accounts payable


9,654



(4,763
)


(182
)Accrued expenses and other current liabilities


(9,774
)


(14,203
)


2,658Net cash provided by continuing operations


64,353



56,051



54,677Net cash provided by discontinued operations






1,163



8,650Net cash provided by operating activities


64,353



57,214



63,327Cash flows from investing activities:Cash used in business combinations and significant asset
    acquisitions, net of cash acquired


(50,527
)


(11,651
)


(32,101
)Capital expenditures


(32,212
)


(48,066
)


(57,557
)Proceeds from asset sales and business divestitures


8,415



58,161



19,897Deposits for business acquisitions and other


(579
)


(1,567
)


(9,796
)Net cash used in continuing operations


(74,903
)


(3,123
)


(79,557
)Net cash used in discontinued operations






(43
)


(5,555
)Net cash used in investing activities


(74,903
)


(3,166
)


(85,112
)Cash flows from financing activities:Proceeds from issuance of debt


136,619



217,232



84,066Repayments of debt and capital lease obligations


(129,941
)


(282,390
)


(49,890
)Proceeds from the exercise of options and warrants






60



691Fees paid for financing transactions


(1,657
)


(2,373
)


(1,259
)Net cash provided by (used in) financing activities 
    continuing operations


5,021



(67,471
)


33,608Effect of exchange rate changes on cash


2,001



(56
)


351Increase (decrease) in cash


(3,528
)


(13,479
)


12,174Cash at the beginning of the year


7,227



20,706



8,532Cash at the end of the year

$
3,699


$
7,227


$
20,706    F-8




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    Organization
    of Business and Basis of Presentation           F-9




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   2.
    Proposed
    Merger with IESI-BFC      out-of-pocket out-of-pocket
  3.
    Summary
    of Significant Accounting Policies  Business
    Combinations and Acquisitions
     F-10




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
  Concentration
    of Credit Risk
    Allowance
    for Doubtful Accounts
      Year Ended December 31,2009


2008


2007Balance at the beginning of the year

$
631


$
985


$
572Provisions, net of recoveries


986



1,135



2,029Bad debts charged to reserves


(1,142
)


(1,423
)


(1,653
)Impact of foreign exchange rate fluctuations


36



(66
)


37Balance at the end of the year

$
511


$
631


$
985  F-11




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Property
    and Equipment
    Buildings

10 to 25 yearsVehicles

10 yearsContainers, compactors and landfill and recycling equipment

5 to 12 yearsFurniture, fixtures and other office equipment

3 to 5 yearsLeasehold improvements

Shorter of lease term or estimated life   Long-Lived
    Assets
      Landfill
    Sites
       F-12




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  units-of-consumption
            Goodwill
    and Other Intangible Assets
     F-13




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      not-to-compete.
  Deferred
    Financing Costs and Debt Discounts
    Fair
    Value Measurements
  1 2
  
    Level one  Quoted market prices in active
    markets for identical assets or liabilities;
    Level two  Inputs other than level one inputs
    that are either directly or indirectly observable; and
    Level three  Unobservable inputs developed
    using estimates and assumptions, which are developed by the
    reporting entity and reflect those assumptions that a market
    participant would use.    Level 1


Level 2


Level 3


TotalAccrued closure and post-closure obligations

$



$



$
19,532


$
19,532Accrued rent relative to the October 2008 restructuring










574



574Fair value of warrants






2,829







2,829$



$
2,829


$
20,106


$
22,935  F-14




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Environmental
    Costs
    Accrued
    Closure and Post-Closure Obligations
      Registration
    Payment Arrangements
    Revenue
    Recognition
    Royalty
    Arrangements
   F-15




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Advertising
    Costs
    Risk
    Management
  U.S.-based
  Year Ended December 31,2009


2008


2007Balance at the beginning of the year

$
6,505


$
6,055


$
5,327Provisions


3,406



4,127



4,513Payments


(3,743
)


(4,104
)


(3,425
)Unfavorable (favorable) claim development for prior periods


(313
)


427



(360
)Balance at the end of the year

$
5,855


$
6,505


$
6,055   Share-Based
    Payments
    Income
    Taxes
   F-16




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      
    an allocation or a shift of income between taxing jurisdictions,
    the characterization of income or a decision to exclude
    reporting taxable income in a tax return, or
    a decision to classify a transaction, entity, or other position
    in a tax return as tax exempt.      
    Federal We are potentially subject to
    U.S. federal tax examinations by tax authorities for the
    tax year ended December 31, 2008. During 2009, we concluded
    the examination of our 2006 and 2007 U.S. federal tax
    returns with no significant changes to taxable income.
    State We are potentially subject to state tax
    examinations by tax authorities for the tax years ended
    December 31, 2006 to 2008.
    Canadian We are no longer potentially subject
    to foreign tax examinations by tax authorities for years before
    January 1, 2002.
    Provincial We are no longer potentially
    subject to foreign tax examinations by tax authorities for years
    before January 1, 2002.    Earnings
    (Loss) Per Share Information
   F-17




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Recently
    Issued Accounting Pronouncements
  No. 2010-06, 2010-06). 2010-06 2010-06
  2009-17, 2009-17). 2009-17 2009-17 2009-17 2009-17
     F-18




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
    December 31,


January 1,2009


2009Annual dividend yield






Expected life (years)


0.4



1.4Risk-free interest rate


0.2
%


0.4
%Expected volatility


53
%


56
%     4.
    Business
    Combinations     F-19




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Clean-up Clean-up),
       F-20




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Miami-DadeCounty





AllOperations


DisposAll


Others


TotalPurchase price:Cash paid

$
32,742


$
14,313


$
3,472


$
50,527Deferred purchase price










168



168Other consideration






1,250







1,250Total purchase price

$
32,742


$
15,563


$
3,640


$
51,945Allocated as follows:Accounts receivable

$
2,245


$
547


$
77


$
2,869Prepaid expenses and other current assets


127











127Accrued expenses and other current liabilities


(1,709
)


(677
)


(34
)


(2,420
)Property and equipment


6,482



3,631



1,825



11,938Other intangible assets


6,100



3,650



988



10,738Fair value of assets acquired

$
13,245


$
7,151


$
2,856


$
23,252Goodwill allocation

$
19,497


$
8,412


$
784


$
28,693      F-21




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Commercial Clean-Up


RIP Landfill


TotalPurchase price:Cash paid and other consideration

$
4,413


$
7,724


$
12,137Deferred purchase price


1,642







1,642Total purchase price


6,055



7,724



13,779Allocated as follows:Working capital assumed:Prepaid expenses and other current assets


1







1Accrued expenses and other current liabilities


(12
)






(12
)Net working capital


(11
)






(11
)Property and equipment


4,424



7



4,431Landfill sites






8,877



8,877Accrued closure, post-closure and other obligations assumed






(1,160
)


(1,160
)Net book value of assets acquired and liabilities assumed


4,413



7,724



12,137Excess purchase price to be allocated

$
1,642


$



$
1,642Allocated as follows:Goodwill

$
1,506


$



$
1,506Other intangible assets


136







136Total allocated

$
1,642


$



$
1,642   Clean-up Clean-up
 F-22




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Allied





USA


AllSouth Florida


WCA


Recycling


Others


TotalPurchase price:Cash paid and transaction costs

$
15,777


$
10


$
13,408


$
1,351


$
30,546Fair value of operations received


52,351



18,416











70,767Total purchase price


68,128



18,426



13,408



1,351



101,313Allocated as follows:Working capital assumed:Cash and cash equivalents


1



210



84







295Accounts receivable


7,417



868











8,285Prepaid expenses and other current assets


254















254Accrued expenses and other current liabilities


(4,090
)


(112
)






(48
)


(4,250
)Net working capital


3,582



966



84



(48
)


4,584Property and equipment


20,076



3,082



5,394



648



29,200Accrued closure, post-closure and other obligations assumed






(312
)










(312
)Net book value of assets acquired and liabilities assumed


23,658



3,736



5,478



600



33,472Excess purchase price to be allocated

$
44,470


$
14,690


$
7,930


$
751


$
67,841Allocated as follows:Goodwill

$
28,341


$
12,702


$
5,709


$
386


$
47,138Other intangible assets


16,129



1,988



2,221



365



20,703Total allocated

$
44,470


$
14,690


$
7,930


$
751


$
67,841       2009


2008


2007Weighted -





Weighted -





Weighted -Average





Average





AverageAmortization





Amortization





AmortizationAmount


Period


Amount


Period


Amount


PeriodAllocated


(Years)


Allocated


(Years)


Allocated


(Years)Customer relationships and contracts

$
9,866



10.0


$







$
16,852



12.5Non-competition agreements and other


872



5.9



136



5.0



3,851



5.2Total other intangible assets acquired

$
10,738



9.6


$
136



5.0


$
20,703



11.1  F-23




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        2009


2008Revenue

$
455,901


$
509,396Loss from continuing operations

$
(2,689
)

$
(5,399
)Basic and diluted loss per share  continuing
    operations

$
(0.06
)

$
(0.12
)Basic and diluted pro forma weighted average number of common
    shares outstanding


46,218



46,079       2008


2007Revenue

$
475,485


$
488,459Loss from continuing operations

$
(2,691
)

$
(12,746
)Basic and diluted loss per share  continuing
    operations

$
(0.06
)

$
(0.28
)Basic and diluted pro forma weighted average number of common
    shares outstanding


46,079



46,007        F-24




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    VancouverCounty


IslandRecycling


Recycling


TotalPurchase price:Cash paid

$
4,415


$
3,357


$
7,772Deferred purchase price






49



49Total purchase price

$
4,415


$
3,406


$
7,821Allocated as follows:Accrued expenses and other current liabilities

$
(85
)

$



$
(85
)Property and equipment


3,295



3,313



6,608Other intangible assets


33



93



126Fair value of assets acquired

$
3,243


$
3,406


$
6,649Goodwill allocation

$
1,172


$



$
1,172     5.
    Discontinued
    Operations     F-25




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      2008


2007Jacksonville


Arizona


TexasOperations


Operations


Operations


TotalFair value of operations received

$



$
52,351


$
18,416


$
70,767Cash received, net of promissory note issued relative to the
    Texas disposal


56,696







15,638



15,638Less:Carrying value of operations sold


38,331



51,588



46,424



98,012Pre-tax gain (loss) on disposition of discontinued operations

$
18,365


$
763


$
(12,370
)

$
(11,607
)       6.
    Prepaid
    Expenses and Other Current Assets    2009


2008Prepaid expenses

$
10,934


$
9,793Parts and supplies


1,896



1,733Other current assets


6,986



2,146$
19,816


$
13,672  F-26




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   7.
    Property
    and Equipment    2009


2008Land and buildings

$
84,594


$
74,497Vehicles


159,788



141,650Containers, compactors and landfill and recycling equipment


108,932



89,568Furniture, fixtures, other office equipment and leasehold
    improvements


13,565



11,060Total property and equipment


366,879



316,775Less: Accumulated depreciation


(162,374
)


(127,975
)Property and equipment, net

$
204,505


$
188,800     8.
    Landfill
    Sites, Accrued Closure, Post-Closure and Other
    Obligations  Landfill
    Sites
    2009


2008Landfill sites

$
277,115


$
262,732Less: Accumulated depletion


(80,773
)


(66,100
)Landfill sites, net

$
196,342


$
196,632     Year Ended December 31,2009


2008


2007Balance at the beginning of the year

$
196,632


$
190,451


$
187,796Landfill site construction costs


5,631



8,773



14,605Additional asset retirement obligations


1,449



1,632



2,832Depletion


(9,808
)


(9,858
)


(16,718
)Purchase price adjustments for prior acquisitions


9



49



505Acquisitions






8,877



Reclassification to conservatory










(1,028
)Effect of foreign exchange rate fluctuations


2,429



(3,292
)


2,459Balance at the end of the year

$
196,342


$
196,632


$
190,451  F-27




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Accrued
    Closure, Post-Closure and Other Obligations
    2009


2008Accrued closure and post-closure obligations

$
14,698


$
12,749Accrued restructuring and severance costs


1,596



3,624Capital lease obligations






568Other obligations


3,140



2,458$
19,434


$
19,399     Year Ended December 31,2009


2008


2007Current portion at the beginning of the year

$
7,589


$
4,153


$
5,570Long-term portion at the beginning of the year


12,749



14,678



8,360Balance at the beginning of the year


20,338



18,831



13,930Additional asset retirement obligations


1,449



1,632



2,832Accretion


640



773



562Acquisitions


250



1,160



Payments


(4,482
)


(339
)


(1,098
)Purchase price allocation adjustments for prior acquisitions










1,301Other additions


96







Effect of foreign exchange rate fluctuations


1,241



(1,719
)


1,304Balance at the end of the year


19,532



20,338



18,831Less: Current portion


(4,834
)


(7,589
)


(4,153
)Long-term portion

$
14,698


$
12,749


$
14,678     2010

$
4,8342011


1,1142012


4682013


4,2982014


1,074Thereafter


117,444$
129,232    F-28




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   9.
    Goodwill
    and Other Intangible Assets    2009


2008Other intangible assets subject to amortization:Customer relationships and contracts

$
58,899


$
48,997Non-competition agreements and other


6,600



5,62965,499



54,626Less: Accumulated amortization:Customer relationships and contracts


(31,484
)


(26,536
)Non-competition agreements and other


(3,472
)


(2,133
)Other intangible assets subject to amortization, net


30,543



25,957Goodwill


388,896



346,929Goodwill and other intangible assets, net

$
419,439


$
372,886     2009Florida


Canada


TotalBalance at the beginning of the year

$
263,428


$
83,501


$
346,929Acquisitions


28,693







28,693Effect of foreign exchange rate fluctuations






13,274



13,274Balance at the end of the year

$
292,121


$
96,775


$
388,896   2008Florida


Canada


TotalBalance at the beginning of the year

$
262,338


$
102,603


$
364,941Acquisitions


1,506







1,506Purchase price allocation adjustments for prior acquisitions


(416
)






(416
)Effect of foreign exchange rate fluctuations






(19,102
)


(19,102
)Balance at the end of the year

$
263,428


$
83,501


$
346,929     2010

$
7,0082011


6,0502012


4,6262013


3,0962014


2,383Thereafter


7,380$
30,543  F-29




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   10.
    Other
    Assets    2009


2008Debt issue costs, net of accumulated amortization of $5,062 and
    $3,035 as of December 31, 2009 and 2008, respectively

$
8,681


$
8,538Acquisition deposits and deferred acquisition costs


1,177



561Other assets


525



549$
10,383


$
9,648     11.
    Accrued
    Expenses and Other Current Liabilities    2009


2008Deferred revenue

$
14,055


$
10,980Accrued compensation, benefits and subcontractor costs


9,849



7,893Accrued insurance premiums


6,559



6,123Insurance reserves


5,855



6,505Accrued waste disposal costs


5,358



7,964Accrued closure and post-closure obligations


4,834



7,589Accrued interest


4,737



3,702Fair value of warrants


2,829



Accrued royalties and franchise fees


2,131



2,137Accrued restructuring and severance costs


2,009



3,183Accrued capital expenditures


969



2,204Accrued professional fees


894



794Current portion of capital lease obligations


570



315Accrued acquisition costs


260



631Other accrued expenses and current liabilities


2,898



2,782$
63,807


$
62,802  F-30




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   12.
    Debt    2009


2008Credit Facilities:U.S. dollar denominated revolving credit facility, floating rate
    at 3.7% and 4.5% as of December 31, 2009 and 2008,
    respectively

$
30,000


$
34,600Canadian dollar denominated revolving credit facility, floating
    rate at 4.8% and 5.3% as of December 31, 2009 and 2008,
    respectively, net of discount of nil and $56 as of
    December 31, 2009 and 2008, respectively


5,709



27,699U.S. dollar denominated term loan facility, floating interest
    rate at 3.7% and 4.5% as of December 31, 2009 and 2008,
    respectively, net of discount of $904 and $1,268 as of
    December 31, 2009 and 2008, respectively


35,994



38,125Canadian dollar denominated term loan facility, floating
    interest rate at 4.0% and 5.3% as of December 31, 2009 and
    2008, respectively, net of discount of $3,117 and $3,668 as of
    December 31, 2009 and 2008, respectively


113,228



103,505Senior Subordinated Notes, fixed interest rate at 9.5%, due
    2014, net of discount of $1,426 and $1,146 as of
    December 31, 2009 and 2008, respectively


208,574



158,854Other secured notes payable, interest at 4.5% to 7.8%, due
    through 2025 (net of discount of $1,075 and $1,563 as of
    December 31, 2009 and 2008, respectively)


5,769



6,891Other subordinated notes payable, interest at 6.7%, due through
    2017


2,178



2,395401,452



372,069Less: Current portion


(20,059
)


(11,102
)Long-term portion

$
381,393


$
360,967     U.S. Dollar


Canadian DollarDenominated


DenominatedDebt (US$)


Debt (C$)2010

$
6,314


$
14,8712011


8,230



21,4812012


12,735



36,3532013


46,742



55,5702014


211,052



Thereafter


847



Future maturities  gross


285,920



128,275Note discounts


(3,405
)


(3,276
)Future maturities  net

$
282,515


$
124,999  F-31




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Senior
    Secured Credit Facilities
        Other
    Secured Notes Payable
    Senior
    Subordinated Notes
  1 2
 F-32




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          13.
    Commitments
    and Contingencies  Leases
    Capital


OperatingLeases


Leases2010

$
585


$
4,3202011






4,1472012






3,8132013






3,4762014






1,959Thereafter






3,504585


$
21,219Less: Amount representing interest


(15
)Current portion of capital lease obligations

$
570  F-33




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Surety
    Bonds and Letters of Credit
    Environmental
    Risks
      Collective
    Bargaining Agreements
    Legal
    Proceedings
   F-34




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Registration
    Payment Arrangement
  90-days 90-day
  Restructuring
    and Severance Related Commitments
    sub-let
 F-35




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Severanceand RelatedCosts


Rent


Consulting


TotalBalance at October 1, 2008

$



$



$



$
Charges


3,596



924



2,351



6,871Payments


(131
)






(1,539
)


(1,670
)Foreign exchange and other


(227
)


60







(167
)Balance at December 31, 2008


3,238



984



812



5,034Changes in estimates and other provisions


(86
)


(87
)






(173
)Payments


(1,868
)


(323
)


(250
)


(2,441
)Foreign exchange and other


208











208Balance at December 31, 2009

$
1,492


$
574


$
562


$
2,628       Purchase
    Agreement
    Other
    Commitments
    14.
    Capital
    Stock  Migration
    Transaction
   F-36




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  non-U.S. residents
      Equity
    Based Compensation Plans
      
    Option Rights (either non-qualified or incentive stock options)
    Stock Appreciation Rights
    Restricted Stock
    Restricted Stock Units
    Performance Compensation Awards
    Stock Bonuses   F-37




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    1 3 1 3
  1 3
  1 3 1 3
      Number of


Weighted Average Exercise PriceShares Issuable


US$ Options


C$ Options (C$)Common shares issuable under option grants -Beginning of the year


2,218,965


$
12.29


$
20.41Granted


282,500



4.33



Forfeited


(49,667
)


8.45



Expired


(1,332,315
)


14.16



20.41End of the year


1,119,483



8.59



  F-38




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009

2008

2007Annual dividend yield










Weighted average expected life (years)


7.0



7.0



3.0Risk-free interest rate


2.6
%


3.2
%


4.5
%Expected volatility


52
%


61
%


92
%         Shares IssuableShares Issuable

for Options

Shares Issuablefor Options

Vested or

for OptionsOutstanding

Expected to Vest

ExercisableNumber of common shares underlying options


1,119,483



1,022,896



748,948Aggregate intrinsic value of options

$
1,293


$



$
Weighted average remaining contractual term (years)


3.3



3.1



2.0Weighted average exercise price

$
8.59


$
8.85


$
10.00   in-the-money
   F-39




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        WeightedWeighted


AverageAverage


Remaining


AggregateNumber


Grant


Contractual


Intrinsicof Shares


Value


Term (Years)


ValueNonvested restricted stock units Beginning of the period


229,158


$
9.02



0.3


$
1,508Granted


438,669



4.55Vested


(171,875
)


9.02Forfeited


(3,751
)


5.04End of the period


492,201



5.07



0.2


$
4,484     Warrants
    WeightedWeighted


AverageNumber


Average


Remaining


Aggregateof Shares


Exercise


Contractual


IntrinsicIssuable


Price


Term (Years)


ValueOutstanding at the beginning of the year


3,317,695


$
9.47



1.3


$
Exercised during the year






Expired during the year


(513,000
)


12.68Outstanding at the end of the year


2,804,695



8.88



0.5



651    F-40




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Effect
    of Proposed Merger with IESI-BFC on Stock Options, RSUs
    and Warrants
    Options.
  RSUs.
  Warrants.
  15.
    Income
    Taxes    2009


2008


2007Current:Federal and state

$



$



$
Canada


5,721



8,760



9,119Current income tax provision


5,721



8,760



9,119Deferred:Federal and state


7,203



4,493



5,257Canada


(1,678
)


451



61Deferred income tax provision


5,525



4,944



5,318Income tax provision

$
11,246


$
13,704


$
14,437  F-41




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        2009


2008


2007United States

$
8,829


$
(4,021
)

$
(37,114
)Canada


16,471



27,288



28,437$
25,300


$
23,267


$
(8,677
)     2009


2008


2007Provision at statutory rate

$
8,602


$
7,911


$
(2,950
)Foreign rate differential


(362
)


(464
)


284Changes in foreign tax rate


(1,848
)


(244
)


(922
)State, net of federal benefit


1,667



(221
)


125Non-deductible stock based compensation


563



458



248Non-deductible interest expense










571Non-deductible foreign exchange loss (gains)


(4
)


244



(29
)Other permanent differences


895



86



426Distributed earnings in foreign subsidiary


22,892



11,363



6,645Valuation allowance


(21,159
)


(5,429
)


10,039Income tax provision

$
11,246


$
13,704


$
14,437  F-42




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009


2008Deferred income tax assets:Tax loss carry forward  U.S

$
25,375


$
42,397Foreign tax credit carry forward  U.S.


14,567



8,535Tax basis in intangible assets in excess of book
    basis  U.S


7,202



6,326Stock-based compensation  U.S


2,817



2,362Accruals not currently deductible  U.S


5,165



9,985Tax loss carryforwards and capital loss
    carry-forwards  Canada


6,632



6,931Tax basis in assets in excess of book basis  Canada


1,372



1,107Accruals not currently deductible  Canada


2,503



2,270Less: Valuation allowance  U.S and Canada


(53,240
)


(69,292
)Net deferred tax assets


12,393



10,621Deferred income tax liabilities:Book basis in property and equipment in excess of tax
    basis  US


(8,518
)


(7,244
)Book basis in goodwill in excess of tax basis  U.S


(32,828
)


(25,620
)Book basis in property and equipment and goodwill in excess of
    tax basis  Canada


(10,959
)


(10,055
)Net deferred income tax liability

$
(39,912
)

$
(32,298
)     15-year
    2009


2008


2007Balance at the beginning of the year

$
69,292


$
68,764


$
55,080Additions to (release of) valuation allowance


(21,159
)


(5,429
)


10,039Increase due to acquisitions, net






146



229Increase due to foreign tax credit carry-forwards


6,032



5,853



1,527Increase in (utilization of) foreign tax loss carry-forwards and
    capital-loss carry forwards


(1,080
)


(1,167
)


2,114Adjustments to valuation allowance


155



1,125



(225
)Balance at the end of the year

$
53,240


$
69,292


$
68,764  F-43




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        16.
    Earnings
    (Loss) Per Share Information    2009


2008


2007Numerator:Net income (loss)

$
14,054


$
9,563


$
(23,114
)Denominator:Weighted average common shares outstanding Basic


46,218



46,079



46,007Diluted


46,325



46,079



46,007     17.
    Retirement
    Plan     F-44




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    18.
    Segment
    Information        2009Florida

Canada

Corporate

TotalRevenue

$
209,251


$
225,264


$



$
434,515Depreciation, depletion and amortization


26,620



17,048



910



44,578Income (loss) from operations


39,840



42,214



(25,353
)


56,701Capital expenditures


14,291



17,447



474



32,212Total assets


640,860



253,520



20,612



914,992   2008Florida

Canada

Corporate

TotalRevenue

$
231,352


$
241,677


$



$
473,029Depreciation, depletion and amortization


25,977



18,052



1,319



45,348Income (loss) from operations


42,195



43,514



(44,050
)


41,659Capital expenditures


18,998



28,493



575



48,066Total assets


600,167



217,531



23,229



840,927   2007Florida

Canada

Corporate

TotalRevenue

$
239,384


$
222,063


$



$
461,447Depreciation, depletion and amortization


35,187



18,332



1,372



54,891Income (loss) from operations


31,296



38,759



(29,242
)


40,813Capital expenditures


29,352



26,822



1,383



57,557Total assets (excluding assets of discontinued operations)


601,181



256,570



40,044



897,795  F-45




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009


2008


2007Collection

$
364,503



74.9
%

$
390,768



74.6
%

$
371,700



72.5
%Landfill disposal


45,689



9.4
%


47,310



9.0
%


59,015



11.5
%Transfer station


65,466



13.5
%


65,210



12.5
%


62,096



12.1
%Material recovery facilities


9,823



2.0
%


18,531



3.5
%


18,372



3.6
%Other specialized services


1,115



0.2
%


1,760



0.4
%


1,259



0.3
%486,596



100.0
%


523,579



100.0
%


512,442



100.0
%Intercompany elimination


(52,081
)






(50,550
)






(50,995
)$
434,515






$
473,029






$
461,447   19.
    Related
    Party Transactions  father-in-law
  1 2
     F-46




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   20.
    Supplementary
    Cash Flow Information    2009

2008

2007Amounts accrued for capital expenditures

$
969


$
2,204


$
2,233Capital expenditures financed with capital leases and notes
    payable






29



1,009Fair value of operations received for the disposition of our
    Arizona and Texas operations










70,767Other cash flow information:Cash paid for interest

$
26,321


$
33,287


$
37,665Cash paid for income taxes


5,705



17,556



3,909   21.
    Selected
    Quarterly Financial Data (unaudited)    2009First


Second


Third


FourthQuarter


Quarter


Quarter


QuarterRevenue

$
95,792


$
107,485


$
112,461


$
118,777Income from operations


12,325



13,761



17,239



13,376Income (loss) from continuing operations


4,010



3,446



6,717



(119
)Net income (loss)


4,010



3,446



6,717



(119
)Basic and diluted earnings per share

$
0.09


$
0.07


$
0.15


$
Weighted average common shares outstanding:Basic


46,110



46,254



46,253



46,253Diluted


46,136



46,254



46,302



46,253   F-47




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  2008First


Second


Third


FourthQuarter


Quarter


Quarter


QuarterRevenue

$
116,609


$
128,282


$
125,745


$
102,393Income (loss) from operations


12,171



16,835



16,521



(3,868
)Income (loss) from continuing operations


5,330



4,030



3,469



(14,785
)Income from discontinued operations


409











Gain (loss) on sale of discontinued operations


6,969



(100
)






4,241Net income (loss)


12,708



3,930



3,469



(10,544
)Basic and diluted income (loss) per share:Income (loss) per share  continuing operations

$
0.12


$
0.09


$
0.08


$
(0.32
)Income per share  discontinued operations


0.16











0.09Income (loss) per share  basic and diluted

$
0.28


$
0.09


$
0.08


$
(0.23
)Weighted average common shares outstanding:Basic


46,075



46,075



46,079



46,082Diluted


46,093



46,075



46,116



46,082     22.
    Condensed
    Consolidating Financial Statements      F-48




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Year Ended December 31, 2007Non-Parent


Guarantors


Guarantors


Eliminations


ConsolidatedRevenue

$



$
239,384


$
222,063


$



$
461,447Operating and other expenses:Cost of operations (exclusive of depreciation, depletion and
    amortization)






154,250



147,323







301,573Selling, general and administrative expense (exclusive of
    depreciation, depletion and amortization)


17,895



18,194



28,150







64,239Depreciation, depletion and amortization


75



35,187



19,629







54,891Loss (gain) on sale of property and equipment, foreign exchange
    and other


(175
)


457



(351
)






(69
)Equity earnings in investees, net of tax


(34,645
)










34,645



Income from operations


16,850



31,296



27,312



(34,645
)


40,813Interest expense


39,964



181



534







40,679Income (loss) from continuing operations before income
    taxes


(23,114
)


31,115



26,778



(34,645
)


134Income tax provision






5,257



9,180







14,437Income (loss) from continuing operations


(23,114
)


25,858



17,598



(34,645
)


(14,303
)Income from discontinued operations






2,796











2,796Loss on sale of discontinued operations






(11,607
)










(11,607
)Net income (loss)

$
(23,114
)

$
17,047


$
17,598


$
(34,645
)

$
(23,114
)   F-49




---



##### Table of Contents



WASTE
    SERVICES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  December 31, 2007Non-Parent


Guarantors


Guarantors


Eliminations


ConsolidatedNet cash provided by (used in) operating activities

$
(49,057
)

$
73,343


$
39,041


$



$
63,327Cash flows from investing activities:Cash used in business combinations and significant asset
    acquisitions, net of cash acquired






(30,702
)


(1,399
)






(32,101
)Capital expenditures


(145
)


(29,352
)


(28,060
)






(57,557
)Proceeds from asset sales and business divestitures






18,099



1,798







19,897Deposits for business acquisitions and other


(8,224
)


72



(1,644
)






(9,796
)Intercompany






(26,038
)


(4,479
)


30,517



Net cash used in continuing operations


(8,369
)


(67,921
)


(33,784
)


30,517



(79,557
)Net cash used in discontinued operations






(5,555
)










(5,555
)Net cash used in investing activities


(8,369
)


(73,476
)


(33,784
)


30,517



(85,112
)Cash flows from financing activities:Proceeds from issuance of debt and draws on revolving credit
    facility


84,066















84,066Principal repayments of debt and capital lease obligations


(49,699
)


(191
)










(49,890
)Proceeds from the exercise of options and warrants


691















691Fees paid for financing transactions


(1,259
)














(1,259
)Intercompany


30,517











(30,517
)


Net cash provided by (used in) financing activities 
    continuing operations


64,316



(191
)






(30,517
)


33,608Effect of exchange rate changes on cash










351







351Increase (decrease) in cash


6,890



(324
)


5,608







12,174Cash at the beginning of the year


2,190



563



5,779







8,532Cash at the end of the year

$
9,080


$
239


$
11,387


$



$
20,706  F-50