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                                                                EXHIBIT 10(d)(9)

                          CREDIT ACCEPTANCE CORPORATION

                           DEALER SERVICING AGREEMENT

RECITALS

WHEREAS, Credit Acceptance Corporation ("Credit Acceptance") is a specialized
financial services company that accepts assignment of retail installment sales
contracts for servicing, administration and collection;

WHEREAS ______________________________________________________(hereinafter
"Dealer") is a automobile dealership licensed to sell motor vehicles and/or
light trucks to consumers at the sales location stated at the end of this
Agreement. As part of the Dealer's business it regularly sells vehicles to
consumers on credit. Dealer has expressed a desire to use the Credit Acceptance
Program in its dealership.

WHEREAS, Credit Acceptance agrees to service the Dealer's Contracts pursuant to
the terms and conditions of this Agreement;

NOW, THEREFORE, in consideration of the mutual promises contained in this
Agreement, the parties agree as follows:

ARTICLE 1

DEFINITIONS

Whenever used in this Agreement, the following words and phrases, unless
otherwise stated, shall have the following meanings:

"ACTUAL CASH VALUE" means the net cash value, with no over allowance, of the
vehicle traded in by Obligor as Down Payment towards the purchase of a Financed
Vehicle.

"ADMINISTRATIVE EXPENSES" refers to all costs, fees and expenses incurred with
respect to any suit, action or proceeding involving or relating to any Dealer
bankruptcy, appointment of a conservator, receiver or liquidator for the Dealer,
readjustment of debt, marshaling of assets and liabilities, or for the winding
up or liquidation of the Dealer's affairs.

"ADVANCE" means an amount advanced to the Dealer pursuant to Section 3.01.

"AGREEMENT" means this Dealer Servicing Agreement, as amended from time to time.

"CAPS" refers to any Internet based credit application processing system that
Credit Acceptance may make available to Dealer.

"COLLECTIONS" means all money received or collected by Credit Acceptance with
respect to a Contract, less any payments required by law to be remitted to the
Obligor, less the amount of any checks returned for insufficient funds.

"COLLECTION COSTS" means all costs, fees and expenses incurred or assessed by
Credit Acceptance in the administration, servicing and collection of a
Receivable.

 "CONFIDENTIAL INFORMATION" means all confidential and/or secret information
concerning Credit Acceptance including, but not limited to, this Agreement, the
Program, Credit Acceptance Property, Documentation, customer lists, dealer
lists, and all information developed by and/or for Credit Acceptance and/or its
affiliates, whether now owned or hereafter obtained, concerning plans, marketing
and sales methods, information systems and Internet processes (including CAPS),
customer relationships, materials, and procedures utilized by Credit Acceptance
and/or its affiliates, business forms, costs, prices, suppliers, information
concerning past, present or future contractors, representatives and past,
present and/or future customers of Credit Acceptance and/or its affiliates,
plans for development of new or existing products, services and expansion into
new areas or markets, internal operations and any variations, trade secrets,
proprietary information and other confidential information of any type together
with all written, graphic, video and other materials relating to all or any part
of the same. Confidential Information shall not include any information (a)
which has been published or became part of the public domain other than by acts
or omissions of the Dealer in violation of this Agreement, (b) was in the
possession of the Dealer at the time of disclosure to Credit Acceptance, (c) was
received by Dealer from a third party who had a lawful right to disclose such
information, (d) was independently developed by Dealer, or (e) is required by
applicable law, rule, regulation or order to be disclosed to a third party. To
the extent that the Dealer is compelled to disclose Confidential Information to
a third party, it agrees to provide Credit Acceptance reasonable notice of the
pending disclosure so that Credit Acceptance can take any action it deems
necessary and appropriate with respect to the disclosure.

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"CONTRACT" means a retail installment or conditional sales contract, promissory
note and security agreement that evidences an Obligors agreement to purchase a
Financed Vehicle over time and that is assigned to Credit Acceptance for
servicing, administration and collection.

(C) 2003 Credit Acceptance Corporation
All Rights Reserved     April 2003

"CONTRACT FILES" means all writings (including an executed copy of the Contract,
credit application, privacy disclosure and discount disclosure) and all other
documents required by Credit Acceptance relating to the sale, purchase and
financing of a Financed Vehicle.

"CREDIT ACCEPTANCE PROPERTY" means all tangible and intangible property owned by
Credit Acceptance, including, but not limited to Company names, trademarks and
copyrighted material including names, logos, slogans and service marks,
Documentation, signs, brochures, posters or other tangible or intangible
property relating to the Program, whether registered or unregistered. CREDIT
ACCEPTANCE WE CHANGE LIVES! (and Design), WE CHANGE LIVES! and the Check Box
Design are registered service marks of Credit Acceptance Corporation. ASK ABOUT
OUR GUARANTEED CREDIT APPROVAL (and Design), ASK OTTO, ASK OTTO (and Design) and
OTTO (and Design) marks, are trademarks or service marks owned by Credit
Acceptance Corporation.

"DOCUMENTATION" means all operational and procedural literature created and
offered by Credit Acceptance to Dealer that relates to or affects the Program,
and shall include all updates, new releases, improvements or derivative works
provided to Dealer from time to time.

"DOWN PAYMENT" means the amount of "cash" plus the Actual Cash Value of any
"trade" paid by an Obligor with respect to the purchase of a Financed Vehicle.

"EFFECTIVE DATE" means the execution date of this Agreement as written on the
signature page hereof.

"FINANCED VEHICLE" means an automobile or light truck, together with all
accessions thereto, securing an Obligor's indebtedness under a Contract.

 "OBLIGOR" means the purchaser or the co-purchaser of a Financed Vehicle or any
other Person who owes payments under the Contract.

"PERSON" means an individual, corporation, estate, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
governmental agency.

"POOL" means a grouping on the books and records of Credit Acceptance of all the
Contracts and the Advances and Receivables associated with said Contracts.

"PORTFOLIO PROFIT" means the amount a Dealer can earn, above and beyond the Down
Payment and Advance, as set forth in Section 3.03 of this Agreement.

"PROGRAM" means the administration, servicing and collection services offered by
Credit Acceptance to Dealers whereby Dealers can offer financing to consumers
with limited access to credit.

"QUALIFYING RECEIVABLE" means a Contract that meets Credit Acceptance's credit
standards and the following specifications:

(i) it has not been rescinded; is not in default; is owned by the Dealer free
and clear of all liens, claims, options, encumbrances and security interests
(other than the security interest in favor of Credit Acceptance) and is in all
other respects a valid, binding and enforceable obligation of the Obligor at the
time the Contract is assigned to Credit Acceptance;

(ii) it complied at the time it was originated or made, and is currently in
compliance in all respects, with all requirements of applicable federal, state
and local laws and regulations thereunder, including, usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing
Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the
Federal Trade Commission Act, the Magnuson - Moss Warranty Act, Title V of the
Gramm-Leach-Bliley Act, the U.S.A. Patriot Act of 2001, Federal Reserve Board
Regulations B, M and Z, state adaptations of the National Consumer Act, the
Uniform Commercial Code and the Uniform Consumer Credit Code and any other
consumer credit or equal opportunity disclosure;

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(iii) at least one Obligor has a current drivers license;

(iv) the Dealer has taken all the steps required by law to enable the Obligor to
register and title the Financed Vehicle in his/her name, and has taken all the
steps necessary to ensure that Credit Acceptance has a first and prior perfected
security interest in the Financed Vehicle securing the performance of the
Obligor under the Contract;

(v) at delivery, the Financed Vehicle is adequately insured with a policy or
policies covering damages, destruction and theft and such policies name Credit
Acceptance as a loss payee;

(vi) the Dealer has delivered the motor vehicle and the motor vehicle satisfied
all warranties, express or implied, made to the Obligor;

(vii) All amounts to be paid by the Obligor at the time of closing have in fact
been paid and the Down Payment disclosed on the credit application and Contract
are consistent and the Down Payment is made in accordance with Section 4.01 (i)
of this Agreement;

(viii) Dealer has not made any charge, including documentary or processing
charges, which Dealer does not make in a cash transaction, other than amounts
included as finance charges or other amounts itemized as amounts financed, such
as insurance and filing fees or other costs paid to public officials to perfect
Credit Acceptance's lien on the Financed Vehicle.

"RECEIVABLE" means the amount of money due and owing by an Obligor under the
terms of a Contract or Contracts that have been assigned to Credit Acceptance
for administration, servicing and collection.

ARTICLE II

ADMINISTRATION AND SERVICING OF CONTRACTS

2.01     ASSIGNMENT AND ACCEPTANCE OF CONTRACTS;

(a) The Dealer may submit Contracts to Credit Acceptance for administration,
servicing and collection under the terms of this Agreement. Each assignment of a
Contract to Credit Acceptance under this Agreement constitutes a new
representation and warranty by the Dealer that such Contract meets the criteria
set forth in the definition of Qualifying Receivable and the provisions of
Article IV of this Agreement.

(b) If Credit Acceptance issues an approval number with respect to a Qualifying
Receivable, the Dealer shall deliver the Contract Files to Credit Acceptance and
assign such Contract and Dealer's security interest in the Financed Vehicle to
Credit Acceptance as nominee for the Dealer, which assignment shall be for
purposes of administration, servicing and collection of the Receivable, as well
as for security purposes as set forth in Section 2.03(d). Upon the request of
Credit Acceptance, the Dealer will furnish Credit Acceptance with any additional
powers of attorney and other documents that Credit Acceptance deems necessary or
appropriate to enable Credit Acceptance to carry out its administration,
servicing and collection duties hereunder. Dealer is not a guarantor or
secondary obligor as those terms may be defined under any applicable Uniform
Commercial Code (UCC) provision, and as such, the Dealer is not entitled to
receive any statutory notices concerning Credit Acceptance's administration,
servicing and collection of a Receivable, such as a post repossession notice,
sale notice or any other statutory notice.

(c) Credit Acceptance's issuance of an approval number with respect to a
Qualifying Receivable shall not be deemed to be acceptance of the assignment of
a Contract for administration, servicing and collection hereunder. Acceptance of
an assignment a Contract shall occur only at such time as Credit Acceptance
receives and approves the related Contract Files.

(d) If Credit Acceptance accepts assignment of a Contract it shall be deemed a
Receivable under this Agreement and Credit Acceptance will administer, service
and collect said Receivable on behalf of the Dealer in accordance with the terms
of this Agreement. Credit Acceptance is hereby authorized and empowered to
endorse the Dealer's name on any payments made payable to the Dealer. Credit
Acceptance is also authorized to execute and deliver, in Credit Acceptance's own
name, and on behalf of the Dealer, any and all instruments of satisfaction or
cancellation, or of partial or full release or discharge, and all other
comparable instruments, with respect to the Contracts or to the Financed
Vehicles.

(e) Upon early termination of a Contract, Dealer understands that the Obligor
may be entitled to a refund of an amount equal to the unused portion of any
premium collected by Dealer or otherwise received by the Dealer in connection
with the sale of any ancillary product, including GAP insurance, property
insurance, credit life and credit life accident and health insurance, and
warranty or service

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contracts. Any refund will be calculated in accordance with the product policy
or as required by applicable law. Dealer will remit payment of the refund in its
possession to the Obligor or to Credit Acceptance, as directed by Credit
Acceptance.

(f) In furtherance of this Agreement, Dealer is encouraged to communicate
information to Credit Acceptance, including location information on Obligors, to
the extent that the Dealer believes that the information will assist Credit
Acceptance in its duties under this Agreement.

2.02     DUTIES OF CREDIT ACCEPTANCE

(a) If Credit Acceptance accepts assignment of a Contract for administration,
servicing and collection, Credit Acceptance's duties shall consist of holding
the Contract Files; collecting payments due under the Contracts as set forth in
subsection (b) of this Section 2.02 and applying the amounts so collected in the
manner set forth in section 3.03; responding to inquiries of Obligors;
investigating delinquencies; sending monthly payment books, payment statements
and/or receipts to Obligors; and furnishing monthly Dealer statements to Dealer
in accordance with Section 3.04.

(b) Credit Acceptance shall use reasonable efforts to collect all payments
called for under the terms and conditions of the Contracts as and when the same
shall become due. At the discretion of Credit Acceptance, Credit Acceptance
shall use reasonable efforts to repossess the Financed Vehicle securing any
Receivable, and sell or otherwise liquidate the Financed Vehicle. Credit
Acceptance may, at its discretion, negotiate payment arrangements with an
Obligor, settle account balances, waive any late payment charge or any other
fee, take any other action that it believes is necessary or advisable in the
administration, servicing and collection of the Receivables, including selling
or assigning delinquent Receivables to third parties for collection, or refrain
from taking any action that it believes is not in the best interest of Credit
Acceptance or the Dealer.

(c) In administering, servicing and collecting the Receivables, and in otherwise
performing its obligations under this Agreement, Credit Acceptance shall comply
with all applicable federal, state and local laws and regulations applicable to
Credit Acceptance's activities.

(d) In the event that any claim, action, proceeding or lawsuit is brought
against Dealer that seeks damages from Dealer based upon allegations that relate
solely to the negligence of Credit Acceptance in the collection of Receivable,
Credit Acceptance will defend, indemnify, and hold harmless Dealer from and
against any and all costs, expenses, losses, damages, claims and liabilities,
including reasonable attorney fees, arising out of or resulting from that claim,
action, proceeding or lawsuit. Dealer shall promptly notify Credit Acceptance in
writing of such claim or threatened claim. Notice should be sent to the address
contained in Section 6.02 of this Agreement. Credit Acceptance shall have
complete control of the defense of said lawsuit and can, at its sole discretion,
negotiate any settlement consistent with the provisions of section 2.02 (b).
Dealer shall have the right to be represented by counsel of its choice, at its
own expense. Nothing in this provision shall entitle Dealer to seek, and Dealer
is specifically prohibited from seeking, recovery from or against Credit
Acceptance for any loss of anticipated or expected revenue or profits including
Portfolio Profit arising out of the inability of Credit Acceptance to collect
Receivables as a result of said lawsuit.

2.03     DUTIES OF DEALER; GRANT OF SECURITY INTEREST

(a) Dealer shall comply will the terms and conditions of this Agreement,
including the representations and warranties set forth in Section 4.01.

(b) The Dealer will take such steps as are necessary to perfect the security
interest in the Financed Vehicle in the name of Credit Acceptance, including
placing Credit Acceptance's name as lien holder on all titles the Financed
Vehicles. The Dealer will take all steps as are necessary to permit the Obligor
to title and register the Financed Vehicle in his/her name.

(c) If an Obligor makes any payments due under a Contract to Dealer after
Contract has been assigned to and accepted by Credit Acceptance, the Dealer will
immediately contact Credit Acceptance and inform them that the payment was
received and shall promptly forward such payment to Credit Acceptance.

(d) The Dealer hereby grants Credit Acceptance a security interest in all
Receivables now or hereafter transferred to Credit Acceptance pursuant to this
Agreement and a security interest in the Dealer's interest in the Financed
Vehicles connected therewith, together with all proceeds, as security for the
payment of all indebtedness of the Dealer to Credit Acceptance, including
Advances, Collection Costs, Administrative Expenses and any other amounts due to
Credit Acceptance hereunder. This grant of a security interest will survive the
termination of this Agreement until the Dealer has paid all its obligations to
Credit Acceptance due under this Agreement in full, including Advances,
Collection Costs and Administrative Expenses. Dealer agrees to take any action
requested by Credit Acceptance from time to time, to further perfect its
security interest in the Receivables.

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(e) The Dealer agrees to adhere to the operational guidelines of the Program and
to take reasonable steps to ensure that it's sales staff is adequately trained
and certified through Credit Acceptance University.

ARTICLE III

ADVANCES, DISTRIBUTIONS AND SERVICING FEE

3.01     ADVANCES

Upon the acceptance by Credit Acceptance of a Contract under Section 2.01,
Credit Acceptance may, in its discretion, make an Advance. The amount of the
Advance will be determined by the applicable advance program or credit score
currently in use by Credit Acceptance and made available to the Dealer at the
time the Contract is submitted to Credit Acceptance under Section 2.01. Each
Advance that is made by Credit Acceptance shall be without recourse to any of
the assets of the Dealer, and, absent Dealer consent, or as required as a matter
of law, or except as provided in Article V of this Agreement, Credit Acceptance
is not entitled to a refund, rebate or return of the Advance from Dealer. Such
Advances shall be placed in a Pool with all other advances paid to Dealer and
shall be repaid to Credit Acceptance as provided in Section 3.03 of this
Agreement. Credit Acceptance reserves the right to modify its advance
methodology from time to time, without any prior notice to Dealer.

3.02     SERVICING FEE

As compensation for the services provided by Credit Acceptance to the Dealer,
Credit Acceptance will retain 20% of all Collections net of Collection Costs.

3.03     APPLICATION OF FUNDS

Collections received by Credit Acceptance during a calendar month shall be
applied on a Pool by Pool basis as follows:

FIRST, to reimburse Credit Acceptance for all Collection Costs;

SECOND, to pay Credit Acceptance its servicing fee set forth in Section 3.02
above;

THIRD, to all outstanding Advances or any other indebtedness or amounts owing
from the Dealer to Credit Acceptance, including, without limitation,
Administrative Expenses, CAPS user fees, contract termination fees, and any
indemnification obligations of Dealer to Credit Acceptance pursuant to Section
4.02 of this Agreement; and

FOURTH, to the Dealer as Portfolio Profit; provided Dealer has placed at least
one hundred (100) Contracts in a Pool and the Dealer has not resigned in
accordance with Section 5.03 of this Agreement. In the event Dealer does not
place at least one hundred (100) Contracts in a Pool and the Dealer has resigned
in accordance with Section 5.03 of this Agreement all amounts that would
otherwise be paid to Dealer under this Section 3.03 of this Agreement as
Portfolio Profit will remain the property of Credit Acceptance.

All amounts due to the Dealer under this Section 3.03 with respect to
Collections made during the calendar month shall be paid to the Dealer as soon
as possible, but in all circumstances before the last day of the month
immediately following the month the Collections were generated.

3.04     STATEMENTS TO DEALER

Credit Acceptance shall provide a monthly Dealer statement, or access to a
monthly Dealer statement via the Internet, containing information relating to
the amounts set forth in Section 3.03 of this Agreement.

If Dealer believes that any portion of its monthly Dealer statement is not
correct or if Dealer needs more information on its monthly Dealer statement,
Dealer must notify Credit Acceptance in writing at the address listed in Section
6.02 within 60 days after the statement was first generated or made available on
the Internet. A telephone call will not be sufficient to preserve Dealer's
rights to question the content of the statement. Dealer's inquiry should provide
a complete description of the item in question, including an explanation of why
Dealer believes it is not correct or why Dealer needs more information.

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Dealer understands and agrees that Credit Acceptance may, at its discretion,
terminate the distribution of monthly Dealer statements in the event Dealer is
no longer in business or fails to submit any Contracts for the proceeding 12
months and Dealer is not receiving Portfolio Profit pursuant to Section 3.03 and
has not specifically requested, in writing, that Credit Acceptance continue to
send monthly Dealer statements.

3.05     CAPPING OF POOLS

A Pool may be capped or uncapped. A Pool may be capped by written agreement
between Credit Acceptance and Dealer when the number of Contracts placed in a
given Pool reaches at least 100. Once a Pool is capped, no further Contracts can
be added to that Pool. While Dealer may have multiple capped Pools, it will have
only one uncapped Pool.

ARTICLE IV

DEALER PROMISES

4.01     REPRESENTATIONS AND WARRANTIES

The Dealer makes the following representations on which Credit Acceptance is
relying in entering into this Agreement with the Dealer in accepting Contracts
and the accompanying Receivables, and each request by the Dealer to Credit
Acceptance to administer, service and collect a Contract under Section 2.01 will
act as a reaffirmation of each of the following representations as of the date
of such request:

(i) DOWN PAYMENT. Dealer understands that the amount of Down Payment paid by the
Obligor is an integral element of the Credit Acceptance Program and that the
Dealer must not misrepresent the amount of the Down Payment paid by the Obligor
in connection with the purchase of a Financed Vehicle. To the extent that the
Dealer accepts a vehicle in trade towards, in whole or in part, the Obligor's
Down Payment, Dealer agrees to apply only the Actual Cash Value of that vehicle
to the Down Payment. Dealer agrees to disclose on credit applications any and
all rebates and source of Down Payment, if known by the Dealer. Dealer warrants
not to purchase any item, transfer funds, include any post dated checks,
rebates, side notes or installment notes to Obligor for use as Down Payment or
for any other reason related to the purchase of a Financed Vehicle, and that the
Down Payment has been collected in full prior to assignment to Credit
Acceptance.

(ii) ORGANIZATION IN GOOD STANDING. The Dealer is duly organized and is validly
existing as a legal entity (corporation, partnership, sole proprietor, LLC,
etc.) in good standing under the laws of the state in which it operates, with
full power and authority to own its properties and to conduct its business, and
had at all relevant times, and shall have power, authority, and legal right to
sell vehicles on credit and the right to acquire and own the Receivables. The
Dealer is duly qualified to do business and has obtained all necessary licenses
and approvals in all jurisdictions in which the ownership or lease of property
or the conduct of its business requires such qualification. The individual
signing this Agreement on behalf of the Dealer has the power and authority to
execute and deliver this Agreement and to carry out its terms and if the
Dealer's corporate by-laws require board approval to enter into this Agreement,
that said approval has been received.

(iii) BINDING OBLIGATIONS. This Agreement constitutes a legal, valid, and
binding obligation of the Dealer enforceable in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
reorganization, or other similar laws affecting the enforcement of creditor's
rights in general.

(iv) BROKERS AND FINDERS. Neither Dealer nor any person acting on its behalf has
employed any broker, agent or finder or incurred any liability for any brokerage
fees, agent commissions, finders fees, or bird dog fees in connection with the
transactions contemplated herein.

(v) NON-RELIANCE. The Dealer has independently and without reliance upon Credit
Acceptance, and based on such documents and information, as it has deemed
appropriate, made its own appraisal of and investigation into the financial
condition and creditworthiness of each Obligor and made its own decision to
enter into a Contract with such Obligor.

4.02     INDEMNITIES

The Dealer will defend, indemnify, and hold harmless Credit Acceptance from and
against any and all costs, expenses, losses, damages, claims and liabilities
arising out of or resulting from:

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(i) any claims by the Obligor with respect to the condition or operation of the
Financed Vehicle; the purchase of the Financed Vehicle; the preparation of the
Contract assigned to Credit Acceptance and, subject to the provisions of Section
2.02 (d), Credit Acceptance's servicing of any Contracts assigned under this
Agreement.

(ii) any breach of any of the representations, warranties or agreements made by
Dealer in this Agreement; and

(iii) any of the Dealer's taxes that may at any time be asserted against Credit
Acceptance with respect to the transactions contemplated herein including,
without limitation any sales, gross receipts, general corporation, tangible or
intangible personal property, privilege, or license taxes and costs and expenses
in defending against same.

Indemnification under this Section shall include reasonable attorneys' fees, and
all expenses of litigation. To the extent that Credit Acceptance incurs any
costs, fees or expenses pursuant to this Section 4.02, Credit Acceptance may, at
its discretion, recover these costs, fees or expenses, through Collections
recovered pursuant to Section 3.03 of this Agreement.

4.03     CONFIDENTIALITY

Except as required for Dealer to conduct its regular daily business with Credit
Acceptance, Dealer shall not at anytime, either during or for a period of two
years after termination of Dealer's relationship with Credit Acceptance, or in
any way, disclose, disseminate, transfer and/or use, or permit anyone else to
disclose, disseminate, transfer and/or use, any Confidential Information of
Credit Acceptance. Dealer acknowledges that the Confidential Information of
Credit Acceptance is valuable, special and unique to Credit Acceptance's
business and on which such business depends, and is proprietary to Credit
Acceptance and its affiliates, and that Credit Acceptance has protected and
wishes to continue to protect the Confidential Information by keeping it secret
and confidential for the sole use and benefit of Credit Acceptance and its
affiliates. Upon termination of this Agreement without the necessity of any
request from Credit Acceptance, or at any other time Credit Acceptance may in
writing so request, Dealer shall promptly deliver to Credit Acceptance all
materials concerning any Confidential Information, copies thereof and any other
materials of Credit Acceptance and/or its affiliates which are in Dealer's
possession or under Dealer's control, and Dealer shall not make or retain any
copy, draft or extract thereof which has been made at any time. The obligations
of Dealer under this Section 4.03 shall survive the termination (for any reason)
or breach of this Agreement. Dealer agrees that Credit Acceptance shall be
entitled, as a matter of law, without the need to prove irreparable injury, to
an injunction, restraining order or other equitable relief from any court of
competent jurisdiction, restraining any violation or threatened violation of
this Section 4.03 by Dealer.

ARTICLE V

TERMINATION AND ASSIGNMENT

5.01     MERGER OR CONSOLIDATION OF CREDIT ACCEPTANCE

Any corporation (i) into which Credit Acceptance may be merged or consolidated,
(ii) which may result from any merger, conversion, or consolidation to which
Credit Acceptance shall be a party or (iii) which may succeed to the business of
Credit Acceptance, shall be the successor to this Agreement without any further
act on the part of any of the parties to this Agreement.

5.02     TERM

This Agreement shall remain in effect from the Effective Date until terminated
in accordance with the terms set forth below.

5.03     RESIGNATION BY DEALER

Dealer can cease submitting Contracts to Credit Acceptance and resign from the
Program at any time. The Dealer will be deemed to have resigned under this
Section 5.03 in the event that it falls six (6) months in arrears on the payment
of the applicable CAPS license fee as set forth in the applicable CAPS License
Agreement as described in Section 6.13 of this Agreement. In the event that
Dealer resigns under this Section 5.03, Credit Acceptance will continue to
comply with its duties in Section 2.02 of this Agreement with respect to the
Contracts accepted prior to resignation in accordance with this Section 5.03.

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5.04     TERMINATION BY CREDIT ACCEPTANCE

Credit Acceptance may terminate this Agreement with respect to acceptance of all
future Contracts upon written notice to Dealer. Absent an obligation to
repurchase a Contract under Section 5.06, or absent an Event of Default under
Section 5.08, Credit Acceptance will continue to comply with its duties under
Section 2.02 of this Agreement with respect to the Contracts accepted prior to
termination in accordance with this Section 5.04.

5.05     TERMINATION BY THE DEALER

In the event that Dealer would like to terminate this Agreement, it must provide
Credit Acceptance with written notice along with payment of all amounts due
under Section 5.09 of this Agreement.

5.06     CONTRACT REPURCHASE

(a) Dealer understands the importance of assigning only those Contracts to
Credit Acceptance that are in compliance with applicable law and are otherwise
in compliance with dealer representations contained in this Agreement. To the
extent that Credit Acceptance or Dealer discovers that a Contract assigned to
Credit Acceptance violates applicable law or violates a dealer representations
contained in this Agreement, Dealer, within 30 days of written notice of the
violation, agrees to repurchase the subject Contract from Credit Acceptance in
accordance with Section 5.07.

(b) Upon receipt of the Repurchase Price as set forth in Section 5.07 of this
Agreement, Credit Acceptance will re-assign the Contract to Dealer and will
execute the necessary documentation transferring Credit Acceptance's lien in the
Financed Vehicle to Dealer. Dealer agrees to defend, indemnify, protect, save,
keep, and hold harmless, Credit Acceptance and its affiliates, and their
respective shareholders, directors, officers, employees, representatives,
agents, servants, successors and assigns from and against any and all, claims,
losses, liabilities, damages, injuries, costs, expenses, attorneys' fees, court
costs and other amounts arising out of or resulting from any collection or
servicing activities on any Contracts that take place by any party other than
Credit Acceptance after the Contracts have been re-assigned to Dealer in
accordance with this provision.

5.07     REPURCHASE PRICE

If Dealer is required to repurchase a Contract in accordance with Section 5.06
of this Agreement, Dealer shall pay to Credit Acceptance, within 30 days of
demand, a $500 termination fee plus the following amounts:

(i) For a pre-computed Contract, the gross balance then owing on the Contract,
including any amount advanced to purchase insurance or to otherwise preserve the
Financed Vehicle or Credit Acceptance's interest therein because the Obligor has
failed to perform all of his, her or its obligations under the Contract, less
the amount of any unearned finance charges or, insurance premium, calculated as
provided in the Contract through the date of payment by Dealer.

(ii) For a simple interest Contract, the amount then owed by the Obligor under
the Contract, which amount shall equal the then unpaid principal balance,
including any amount added to the principal balance because Credit Acceptance
has purchased insurance or expended funds to preserve the Financed Vehicle or
Credit Acceptance's interest therein because the Obligor has failed to perform
all of his, her or its obligations under the Contract, plus any accrued but
unpaid interest through the date of payment by Dealer, less the amount of any
unearned insurance premium.

(iii) If Credit Acceptance has incurred any collection or repossession expenses,
including attorneys fees in connection with a Contract to be repurchased by
Dealer, the Repurchase Price of the Contract shall include the amount of such
expenses.

5.08     EVENT OF DEFAULT

This Agreement shall terminate immediately, without further notice to Dealer,
and Credit Acceptance shall be entitled to immediate repayment of all
outstanding Advances and the other amounts specified in Section 5.09 upon the
occurrence of any one of the following events:

(i) Dealer refuses to grant Credit Acceptance or its designee access to audit
its records as provided for in Section 6.10 of this Agreement;

(ii) Dealer admits in writing its inability to pay its debts generally as they
become due; files a petition to take advantage of any applicable bankruptcy
statute; makes an assignment for the benefit of its creditors or voluntarily
suspends payment of its obligations; a

                                       8
<PAGE>

decree or order is entered by a court or agency for the appointment of a
conservator, receiver or liquidator for Dealer in any bankruptcy, readjustment
of debt, marshaling of assets and liabilities, or similar proceedings, or for
the winding up or liquidation of its affairs; or Dealer consents to the
appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities, or similar
proceedings of or relating to Dealer; or Dealer breaches the CAPS License
Agreement as set forth in Section 6.13 of this Agreement; or

(iii) Dealer, without Credit Acceptance's written consent (which consent shall
not be unreasonably withheld or delayed), (a) is dissolved; (b) merges or
consolidates with a Person other than an affiliated entity of Dealer; (c)
leases, sells or otherwise conveys a material part of its assets or business
outside the ordinary course of business to a Person other than an affiliated
entity of Dealer; (d) ceases to operate its business; or (e) agrees to do any of
the foregoing.

5.09     ACCELERATION OF DEALER'S POOLS

In the event that Dealer desires to terminate this Agreement pursuant to Section
5.05 of this Agreement, or the Dealer is in default in accordance with Section
5.08 of this Agreement, the Dealer shall immediately pay to Credit Acceptance
the following amounts:

(i) Any unreimbursed Collection Costs and Administrative Expenses;

(ii) Any unpaid Advances and all other amounts owed by the Dealer to Credit
Acceptance; and

(iii) A termination fee equal to 15% of the then outstanding amount of the
Receivables.

Upon receipt in full of the amounts set forth in (i) through (iii) above, Credit
Acceptance shall deliver all Contract Files to the Dealer and shall take such
action as may be requested by Dealer, at the Dealer's expense, to terminate or
assign to the Dealer, Credit Acceptance's security interest in the Receivables
and Financed Vehicles. If the Dealer fails to promptly pay such amounts, Credit
Acceptance may exercise any rights it has, including those under the UCC, and
may, at its discretion, continue to collect the Receivables and retain
Collections in satisfaction of such amounts due from the Dealer. Dealer agrees
to defend, indemnify, protect, save, keep, and hold harmless Credit Acceptance
and its Affiliates, and their respective shareholders, directors, officers,
employees, representatives, agents, servants, successors and assigns from and
against any and all, claims, losses, liabilities, damages, injuries, costs,
expenses, attorneys' fees, court costs and other amounts arising out of or
resulting from any collection or servicing activities on any Contracts that take
place by any party other than Credit Acceptance after the Contracts have been
re-assigned to Dealer in accordance with this provision.

Dealer acknowledges and agrees that this termination fee is not a penalty
provision, but rather just compensation for the work Credit Acceptance performed
up to the date of termination in addition to the work that will have to be
performed in transferring the Contract Files back to the Dealer or its designee,
releasing its lien in the Financed vehicle and in notifying the Obligors that
their Contracts are now being serviced by the Dealer or its designee.

ARTICLE VI

MISCELLANEOUS PROVISIONS

6.01     GOVERNING LAW

This Agreement shall be construed in accordance with the laws of the State of
Michigan and the obligations, rights, and remedies of the parties under this
Agreement shall be determined in accordance with such laws.

6.02     NOTICES

All demands, notices, and communications under this Agreement shall be in
writing, personally delivered or mailed by first-class mail. Notices to Dealer
shall be sent to the corporate address specified on the last page of this
Agreement. Notices to Credit Acceptance shall be sent to the following address:
Credit Acceptance, Attention Dealer Notices, P.O. Box 5070, Southfield, MI
48086-5070. Either party may change this address upon written notice to the
other party. All notices shall be deemed received on the fifth day following
deposit with the U.S. Mail, certified or registered, postage pre-paid and
addressed as set forth in this Section 6.02.

6.03     SEVERABILITY OF PROVISIONS; UNENFORCEABILITY

If any one or more of the provisions of this Agreement shall be for any reason
whatsoever held invalid, then such provisions shall be deemed severable from the
remaining provisions of this Agreement or the rights of the Dealer or Credit
Acceptance. If for any reason

                                       9
<PAGE>

a court determines that any part of any of the provisions of this Agreement is
unreasonable in scope or otherwise unenforceable, such provision(s) will be
deemed modified and fully enforceable, as so modified, to the extent determined
by the court to be reasonable under the circumstances.

6.04     ARBITRATION AND COSTS

Any disputes and differences arising between the parties in connection with or
relating to this Agreement or the parties relationship with respect hereto shall
be settled and finally determined by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. The
arbitration shall take place in Oakland County, Michigan and shall be conducted
by three arbitrators, one of whom shall be selected by the Dealer, one selected
by Credit Acceptance and the third by the two arbitrators so selected. Each
party shall notify the other party of the arbitrators selected by it within 30
days of a written request from one party to the other for arbitration. In the
event either party shall fail to select an arbitrator or fail to notify the
other party of the arbitrator that it has selected within such time period, the
arbitrator so selected by the other party shall select a second arbitrator. The
decision and award of the arbitrators shall be in writing, and shall be final
and binding upon the parties hereto. Judgment upon the award may be entered in
any court having jurisdiction thereof or any application may be made to such
court for judicial acceptance of or award in order of enforcement, as the case
may be. Notwithstanding the foregoing, Credit Acceptance shall be entitled to
seek equitable relief under this Agreement, pursuant to Section 4.03 in any
court of competent jurisdiction, including any court in the State of Michigan,
County of Oakland, or in the United States District Court of the Eastern
District of Michigan, and Dealer consents to the jurisdiction thereof.

6.05     RIGHTS CUMULATIVE / WAIVER/FORCE MAJEURE

All rights and remedies from time to time conferred upon or reserved to Credit
Acceptance are cumulative, and none is intended to be exclusive of another. No
delay or omission in insisting upon the strict observance or performance of any
provision of this Agreement, or in exercising any right or remedy, shall be
construed as a waiver or relinquishment of such provision, nor shall it impair
such right or remedy. Credit Acceptance shall not be responsible for any failure
to perform its obligations under this Agreement due to causes beyond its
reasonable control, including but not limited to acts of God, war, riot,
terrorism, acts of civil or military authorities, fire, floods or accidents.

6.06     USAGE OF TERMS

With respect to all terms in this Agreement, the singular includes the plural
and the plural the singular; words importing any gender include the other
genders; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation".

6.07     ASSIGNMENT

This Agreement shall inure to the benefit of Credit Acceptance and the Dealer
and each of their permitted successors and assigns. Notwithstanding anything in
this Agreement to the contrary, the Dealer may not assign its rights under this
Agreement to any Person without the prior written consent of Credit Acceptance.

6.08     SETOFF

Credit Acceptance may, at any time and from time to time, at its option, set off
and apply against any amounts due to Credit Acceptance either hereunder or
otherwise any Dealer funds held by Credit Acceptance. This right of setoff
extends to any additional or subsequently acquired or opened Dealer Pools.

6.09     DELEGATION OF DUTIES; LIABILITY

Credit Acceptance may execute any of its duties under this Agreement by or
through agents, nominees or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. Credit Acceptance
shall not be responsible for the negligence or misconduct of any agents,
nominees or attorneys-in-fact selected by it with reasonable care. Neither
Credit Acceptance nor any of its officers, directors, employees, nominees,
attorneys-in-fact or affiliates shall be liable for any action lawfully taken or

                                       10
<PAGE>

omitted to be taken by it or any such person under or in connection with this
Agreement (except for its or such person's own gross negligence or willful
misconduct).

6.10     AUDIT

Dealer agrees to allow Credit Acceptance or its designee access, during regular
business hours, but no more than twice in any one calendar year, to audit
Dealer's internal records relating to Contracts assigned to Credit Acceptance
under this Agreement, including individual deal jackets, recap sheets, general
ledger, bank statements, cash receipt books and journals, repair order,
reconditioning reports and any other documents deemed necessary by Credit
Acceptance for use in conducting its audit. Upon completion of the audit, Credit
Acceptance will notify Dealer of the audit results. Credit Acceptance and Dealer
agree to meet and discuss the audit results in an attempt to resolve any issues
that may be discovered through the audit.

6.11     NO FRANCHISE

Nothing in this Agreement is intended to grant or grants to Dealer any right to
offer, sell or distribute any products or services in the name of or on behalf
of Credit Acceptance. Dealer is free to sell cars on cash or credit and to sell
or assign the corresponding Contract to any Person of its choice.

6.12     ANNOUNCEMENTS, TRADE MARKS, SERVICE MARKS, COPYRIGHT AND ADVERTISING

Dealer will not issue any external announcements, press releases or advertising,
whether verbal or written, in any way pertaining to the subject matter of this
Agreement without first obtaining the prior written consent of Credit
Acceptance. Neither Dealer nor Credit Acceptance shall use or refer to any name,
mark, symbol or other trade identity of the other in any advertisement, press
release or other communication without first obtaining the prior written consent
of the other. Credit Acceptance hereby grants Dealer a non-exclusive,
non-transferable right to use Credit Acceptance Property in the form and manner
approved by Credit Acceptance. Dealer agrees to permit representatives of Credit
Acceptance onto Dealer's premises during regular business hours to inspect
Dealer's use of Credit Acceptance Property. Dealer agrees to not copy, modify,
lease, license, sublicense, sell, assign, distribute, disclose or transfer
Credit Acceptance Property, in whole or in part. Dealer shall not create any
derivative work from, or adaptations of Credit Acceptance Property. Dealer will
not apply to register any name which includes Credit Acceptance Property as an
internet domain name without Credit Acceptance's written approval. Dealer agrees
to change or discontinue the use of any Credit Acceptance Property upon request
by Credit Acceptance. In the event that Credit Acceptance terminates this
Agreement in accordance with Section 5.04 of this Agreement, or Dealer resigns
or terminates this Agreement in accordance with Sections 5.03 or 5.05 of this
Agreement respectfully, or if there is an Event of Default under Section 5.08 of
this Agreement, Dealer agrees to immediately cease use of all Credit Acceptance
Property in the operation of its business. Furthermore, Dealer agrees not to
use, either directly or indirectly, any marks or symbols that are confusingly
similar to Credit Acceptance Property in a manner that Credit Acceptance
believes will confuse or deceive the public.

6.13     USE OF CAPS

In order to utilize CAPS and the Program, Dealer must execute a separate CAPS
License Agreement. The Dealer's use of CAPS and the Program is subject to the
terms and conditions of the CAPS License Agreement. In the event that Dealer
violates a provision of the CAPS License Agreement, said violation will
constitute a breach of this Agreement. In the event that there is a conflict in
the terms of the CAPS License Agreement and this Agreement, the terms of this
Agreement shall control.

6.14     WAIVER OF JURY TRIAL

In the event that Section 6.04 is found unenforceable, Dealer and Credit
Acceptance after consulting or having had the opportunity to consult with
counsel, knowingly, voluntarily and intentionally waives any right they may have
to a trial by jury in any litigation based upon or arising out of this Agreement
or any course of conduct, dealing, statements (whether oral or written), or
actions of Dealer or Credit Acceptance. Dealer shall not seek to consolidate, by
counterclaim or otherwise any such action in which a jury trial cannot be or has
not been waived.

6.15     CONTRACT FORMS AND CALCULATIONS

                                       11
<PAGE>

Credit Acceptance may make available to Dealer state specific blank contract
forms for each state in which Dealer operates. Dealer accepts these blank
contract forms without warranty of any kind whatsoever from Credit Acceptance,
including the implied warranty of merchantability. Dealer should satisfy itself
that the blank contract forms and the computational information it places in the
blank contract forms is accurate and in compliance with all applicable laws. If
Dealer desires to use blank contract forms supplied by a different source, it
must first receive written authorization from Credit Acceptance.

6.16     PRIVACY

In performing their respective obligations under this Agreement, Dealer and
Credit Acceptance shall comply with all privacy and data protection laws, rules
and regulations which are, or which may in the future, be applicable to them or
their respective obligations under this Agreement. Without limiting the
foregoing, Dealer and Credit Acceptance shall protect and keep confidential all
Non-Public Personal Information about or pertaining to any Obligor. For purposes
of this Section, "Non-Public Personal Information" shall have the same meaning
as that term is defined in Title V of the Gramm-Leach-Bliley Act, and applicable
regulations thereto.

6.17     INDEPENDENCE

Notwithstanding any provision to the contrary elsewhere in this Agreement,
Credit Acceptance is acting as an independent contractor, and shall have no
duties or responsibilities, except those expressly set forth herein, or any
fiduciary relationship with Dealer, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist with respect to Credit Acceptance. Furthermore,
Dealer, including without limitation, its employees and salespersons, have not
represented to any Person that it is an agent of Credit Acceptance.

6.18     COMPLETE AGREEMENT

Other than the CAPS License Agreement, as described in Section 6.13 of this
Agreement, or the Guaranteed Credit Approval System Investment Guarantee which
may be signed by the Dealer contemporaneously with the execution of this
Agreement at initial enrollment on the Program, or any agreement related to
participation by Dealer in a Credit Acceptance approved ancillary product
program, this Agreement contains the complete agreement of the parties hereto,
and supersedes any and all prior agreements, including any agreements (whether
written or oral), with respect to the subject matter hereof. Any Contracts
accepted by Credit Acceptance for administration, servicing and collection
pursuant to any agreement dated before the execution of this Agreement, will now
be administered, serviced and collected pursuant to the terms and conditions of
this Agreement. Unless otherwise stated herein, this Agreement may not be
altered or amended without the written consent of both parties.

                                       12
<PAGE>

EFFECTIVE DATE: ______________________________________

SECTION 1 (TO BE COMPLETED BY CREDIT ACCEPTANCE)
CREDIT ACCEPTANCE CORPORATION

By: _______________________________________________

Its: _______________________________________________
                     (Title)

SECTION 2 (TO BE COMPLETED BY DEALER)
DEALERSHIP

(Legal Name):___________________________________________________________________

(D/B/A or Assumed Name):________________________________________________________

By:__________________________________________
               (Signature)

By:__________________________________________
                 (Print)

Its:_________________________________________
                (Title)

SECTION 3 (TO BE COMPLETED BY DEALER)
DEALERSHIP'S SALES LOCATION

Street Address:_________________________________________________________________
________________________________________________________________________________

City:__________________   State:____________________    Zip:____________________

                                       13
<PAGE>

SECTION 4 (TO BE COMPLETED BY DEALER)
DEALERSHIP'S CORPORATE ADDRESS

[ ]      CHECK IF SAME AS SALES LOCATION

Street Address:_________________________________________________________________
________________________________________________________________________________

City:__________________   State:____________________    Zip:____________________

                                       14exv10w1

 

EXHIBIT 10.1

EMPLOYMENT AGREEMENT

     This EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into on
this 30th day of March, 2003 by and between Recycle America Alliance, L.L.C.
and Steve Ragiel (the “Executive”). Recycle America Alliance, L.L.C. is an
indirect subsidiary of Waste Management, Inc. (“WMI”). Recycle America
Alliance, L.L.C. and all of its affiliates shall be referred to herein as “the
Company.”

     1.     Employment and Termination of Previous Employment Agreement.

     The Company shall employ Executive, and Executive shall be employed by the
Company upon the terms and subject to the conditions set forth in this
Agreement.

     Executive acknowledges and represents that the certain Employment
Agreement between he and WMI dated on or about October 14, 1998 is terminated,
and that any and all obligations of WMI created thereunder, whether express or
implied, are null and void and of no further force or effect, and that the only
rights, obligations, and duties between the Company and Executive are those
expressly set forth in this Agreement.

     2.     Term of Employment.

     The period of Executive’s employment under this Agreement shall commence
on January 1, 2003 (“Employment Date”), and shall continue for a period of two
(2) years thereafter, and shall automatically be renewed for successive one (1)
year periods thereafter, unless Executive’s employment is terminated in
accordance with Section 5 below. The period during which Executive is employed
hereunder shall be referred to as the “Employment Period.”

     3.     Duties and Responsibilities.

     (a)  Executive shall serve as President of Recycle America Alliance, L.L.C.
In such capacity, Executive shall perform such duties and have the power,
authority, and functions as set forth in the Operating Agreement of the
Company, in the policies and procedures of WMI (which shall be applicable to
the Company), as otherwise set forth by the Board of Managers of the Company,
and as may be assigned to Executive from time to time by the Chief Executive
Officer, Chief Administrative Officer or Chief Operating Officer of WMI (in any
such case, hereinafter referred to as the “Chief Executive Officer”).

     (b)  Executive shall devote substantially all of his working time,
attention and energies to the business of the Company, and its affiliated
entities. Executive may make and manage his personal investments (provided
such investments in other activities do not violate the provisions of Section 8
of this Agreement), be involved in charitable and professional activities, and,
with the prior written consent of the Chief Executive Officer, serve on boards
of other for profit entities, provided such activities do not materially
interfere with the performance of his duties hereunder.

 

 

     4.     Compensation and Benefits.

     (a)  Base Salary. During the Employment Period, the Company shall pay
Executive a base salary at the annual rate of Two Hundred Seventy-Five Thousand
and 00/100ths Dollars ($275,000.00) per year, or such higher rate as may be
determined from time to time by the Chief Executive Officer (“Base Salary”).
Such Base Salary shall be paid in accordance with the Company’s standard
payroll practice for its executive officers. Once increased, Base Salary shall
not be reduced.

     (b)  Annual Bonus. During the Employment Period, Executive will be
entitled to participate in an annual incentive compensation plan of the
Company. The Executive’s target annual bonus will be seventy-five percent
(75%) of his Base Salary in effect for such year (the “Target Bonus”), and his
actual annual bonus may range from 0% to 150% (two times Target Bonus), and
will be determined based upon (i) the achievement of certain WMI and Company
performance goals, as may be established and approved by from time to time by
the Compensation Committee of the WMI Board of Directors, and (ii) the
achievement of personal performance goals as may be established by the Chief
Executive Officer.

     (c)  Stock Options. Executive shall be eligible to be considered for stock
option grants under Waste Management, Inc.’s annual stock option award program
as administered by, and at the discretion of, the Compensation Committee of the
WMI Board of Directors.

     (d)  Benefit Plans and Vacation. Subject to the terms of such plans,
Executive shall be eligible to participate in or receive benefits under any
long-term incentive plan, pension plan, profit sharing plan, salary deferral
plan, medical and dental benefits plan, life insurance plan, short-term and
long-term disability plans, or any other health, welfare or fringe benefit
plan, generally made available to similarly-situated WMI executive employees.
Neither WMI nor the Company shall be obligated to institute, maintain, or
refrain from changing, amending, or discontinuing any benefit plan, or
perquisite, so long as such changes are similarly applicable to
similarly-situated employees generally.

     During the Employment Period, Executive shall be entitled to vacation each
year in accordance with the Company’s policies in effect from time to time, but
in no event less than four (4) weeks paid vacation per calendar year.

     (e)  Expense Reimbursement. The Company shall promptly reimburse Executive
for the ordinary and necessary business expenses incurred by Executive in the
performance of the duties hereunder in accordance with the Company’s customary
practices applicable to its executive officers.

     (f)  Other Perquisites. Executive shall be entitled to all perquisites
provided to Senior Vice Presidents of WMI as approved by the Chief Executive
Officer or the Compensation Committee of the WMI Board of Directors, and as
they may exist from time to time.

     5.     Termination of Employment.

     Executive’s employment hereunder may be terminated during the Employment
Period

2

 

 under the following circumstances:

     (a)  Death. Executive’s employment hereunder shall terminate upon
Executive’s death.

     (b)  Total Disability. The Company may terminate Executive’s employment
hereunder upon Executive becoming “Totally Disabled.” For purposes of this
Agreement, Executive shall be considered “Totally Disabled” if Executive has
been physically or mentally incapacitated so as to render Executive incapable
of performing the essential functions of Executive’s position with or without
reasonable accommodation. Executive’s receipt of disability benefits under the
Company’s long-term disability plan or receipt of Social Security disability
benefits shall be deemed conclusive evidence of Total Disability for purpose of
this Agreement; provided, however, that in the absence of Executive’s receipt
of such long-term disability benefits or Social Security benefits, the Board of
Managers may, in its reasonable discretion (but based upon appropriate medical
evidence), determine that Executive is Totally Disabled.

     (c)  Termination by the Company for Cause. The Company may terminate
Executive’s employment hereunder for “Cause” at any time after providing a
Notice of Termination for Cause to Executive.

	 	(i)	 	For purposes of this Agreement, the term “Cause” means any of
the following: (A) willful or deliberate and continual refusal to
perform Executive’s employment duties reasonably requested by the
Company or the Chief Executive Officer after receipt of written
notice to Executive of such failure to perform, specifying such
failure (other than as a result of Executive’s sickness, illness or
injury) and Executive fails to cure such nonperformance within ten
(10) days of receipt of said written notice; (B) breach of any
statutory or common law duty of loyalty to the Company; (C) has been
convicted of, or pleaded nolo contendre to, any felony; (D)
willfully or intentionally caused material injury to the Company,
its property, or its assets; (E) disclosed to unauthorized person(s)
proprietary or confidential information of the Company; or (F)
breach of any of the covenants set forth in Section 8 hereof.
	 
	 	(ii)	 	For purposes of this Agreement, the phrase “Notice of
Termination for Cause” shall mean a written notice that shall
indicate the specific termination provision in Section 5(c)(i)
relied upon, and shall set forth in reasonable detail the facts and
circumstances which provide the basis for termination for Cause.
Further, a Notification of Termination for Cause shall be required
to include a copy of a resolution duly adopted by at least a
majority of the entire membership of the Company’s Board of Managers
at a meeting of the Board of Managers which was called for the
purpose of considering such employment termination, and at which
Executive and his representative had the right to attend and address
the Board, finding that, in the good faith belief of the Board,
Executive engaged in conduct set forth in Section 5(c)(i) herein and
specifying the particulars thereof in reasonable detail. The date
of termination for Cause shall be the date indicated in the Notice
of Termination for Cause.

3

 

     (d)  Voluntary Termination by Executive. Executive may terminate his
employment hereunder with or without Good Reason at any time upon written
notice to the Company.

	 	(i)	 	A termination for “Good Reason” means a resignation of
employment by Executive by written notice (“Notice of Termination
for Good Reason”) given to Chief Executive Officer within ninety
(90) days after the occurrence of the Good Reason event, unless such
circumstances are substantially corrected prior to the date of
termination specified in the Notice of Termination for Good Reason.
For purposes of this Agreement, “Good Reason” shall mean the
occurrence or failure to cause the occurrence, as the case may be,
without Executive’s express written consent, of any of the following
circumstances: (A) the Company substantially changes Executive’s
core duties or removes Executive’s responsibility for those core
duties, so as to effectively cause Executive to no longer be
performing the duties of his position (except in each case in
connection with the termination of Executive’s employment for Cause
or Total Disability or as a result of Executive’s death, or
temporarily as a result of Executive’s illness or other absence),
provided that the change in the geographic area of Executive’s
responsibility or the change in reporting structure shall not
constitute Good Reason under any circumstances; further provided
that if the Company becomes a fifty percent or more subsidiary of
any other entity, or merges with, transfers assets to, or the
business is otherwise transferred to a third party (which may be
owned in whole or in part, directly or indirectly by WMI), Executive
shall be deemed to have a substantial change in the core duties of
his position unless he is the equivalent of a Senior Vice-President
of WMI or such other successor entity and retains the core duties
and responsibilities of his existing position; (B) other than as
contemplated by (a) above, removal or the non-reelection of the
Executive from the officer position with the Company specified
herein, or removal of the Executive from any of his then officer
positions; (C) any material breach by the Company of any provision
of this Agreement, including without limitation Section 10 hereof;
or (D) failure of any successor to the Company or to WMI (whether
direct or indirect and whether by merger, acquisition, consolidation
or otherwise) to assume in a writing delivered to Executive upon the
assignee becoming such, the obligations of the Company hereunder.
	 
	 	(ii)	 	A “Notice of Termination for Good Reason” shall mean a notice
that shall indicate the specific termination provision relied upon
and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for Termination for Good Reason. The
Notice of Termination for Good Reason shall provide for a date of
termination not less than ten (10) nor more than sixty (60) days
after the date such Notice of Termination for Good Reason is given,
provided that in the case of the events set forth in Sections
5(d)(i)(A) or (B), the date may be five (5) business days after the
giving of such notice.

     (e)  Termination by the Company without Cause. The Company may terminate
Executive’s employment hereunder without Cause at any time upon written notice
to Executive.

4

 

     (f)  Effect of Termination. Upon any termination of employment for any
reason, Executive shall immediately resign from all Board memberships and other
positions with the Company, or any of its parent corporations or subsidiaries
held by him at such time.

     6.     Compensation Following Termination of Employment.

     In the event that Executive’s employment hereunder is terminated,
Executive shall be entitled to the following compensation and benefits upon
such termination:

     (a)  Termination by Reason of Death. In the event that Executive’s
employment is terminated by reason of Executive’s death, the Company shall pay
the following amounts to Executive’s beneficiary or estate:

	 	(i)	 	Any accrued but unpaid Base Salary for services rendered to
the date of death, any accrued but unpaid expenses required to be
reimbursed under this Agreement, any accrued but unused vacation,
any earned but unpaid bonuses for any prior period, and, to the
extent not otherwise paid, a pro-rata bonus or incentive
compensation payment to the extent payments are awarded to senior
executives of WMI and paid at the same time as senior executives are
paid.
	 
	 	(ii)	 	Any benefits to which Executive may be entitled pursuant to
the plans, policies and arrangements (including those referred to in
Section 4(d) hereof), as determined and paid in accordance with the
terms of such plans, policies and arrangements.
	 
	 	(iii)	 	An amount equal to the Base Salary (at the rate in effect as
of the date of Executive’s death) which would have been payable to
Executive if Executive had continued in employment for two
additional years. Said payments will be paid to Executive’s estate
or beneficiary at the same time and in the same manner as such
compensation would have been paid if Executive had remained in
active employment.
	 
	 	(iv)	 	As of the date of termination by reason of Executive’s death,
stock options previously awarded to Executive as of the date of
death shall be fully vested, and Executive’s estate or beneficiary
shall have up to one (1) year from the date of death to exercise all
such previously-awarded options, provided that in no event will any
option be exercisable beyond its term. No stock options
contemplated by this Agreement, but not yet awarded to Executive as
of the time of his death, shall be granted.

     (b)  Termination by Reason of Total Disability. In the event that
Executive’s employment is terminated by reason of Executive’s Total Disability
as determined in accordance with Section 5(b), the Company shall pay the
following amounts to Executive:

	 	(i)	 	Any accrued but unpaid Base Salary for services rendered to
the date of termination, any accrued but unpaid expenses required to
be reimbursed under

5

 

	 	 	 	this Agreement, any accrued but unused vacation, and any earned but
unpaid bonuses for any prior period. Executive shall also be
eligible for a pro-rata bonus or incentive compensation payment to
the extent such awards are made to senior executives of WMI for the
year in which Executive is terminated, and to the extent not
otherwise paid to the Executive.
	 
	 	(ii)	 	Any benefits to which Executive may be entitled pursuant to
the plans, policies and arrangements (including those referred to in
Section 4(d) hereof) shall be determined and paid in accordance with
the terms of such plans, policies and arrangements.
	 
	 	(iii)	 	An amount equal to the Base Salary (at the rate in effect as
of the date of Executive’s Total Disability) which would have been
payable to Executive if Executive had continued in active employment
for two years following termination of employment, less any payments
under any long-term disability plan or arrangement paid for by the
Company. Payment shall be made at the same time and in the same
manner as such compensation would have been paid if Executive had
remained in active employment until the end of such period.
	 
	 	(iv)	 	As of the date of termination by reason of Executive’s Total
Disability, stock options previously awarded to Executive as of the
date of termination shall be fully vested, and Executive or his
legal guardian shall have up to one (1) year from the date of death
to exercise all such previously-awarded options, provided that in no
event will any option be exercisable beyond its term. No stock
options contemplated by this Agreement, but not yet awarded to
Executive as of the time of his employment termination, shall be
granted.

     (c)  Termination for Cause. In the event that Executive’s employment is
terminated by the Company for Cause, the Company shall pay the following
amounts to Executive:

	 	(i)	 	Any accrued but unpaid Base Salary for services rendered to
the date of termination, any accrued but unpaid expenses required to
be reimbursed under this Agreement, any accrued but unused vacation,
and any earned but unpaid bonuses for any prior period.
	 
	 	(ii)	 	Any benefits to which Executive may be entitled pursuant to
the plans, policies and arrangements (including those referred to in
Section 4(d) hereof up to the date of termination) shall be
determined and paid in accordance with the terms of such plans,
policies and arrangements.
	 
	 	(iii)	 	All options, whether vested or not vested prior to the date
of such termination of employment, shall be automatically cancelled
on the date of employment termination. However, it is expressly
understood and agreed that Executive would have no obligation to
repay or otherwise reimburse the Company for funds received as a
result of Executive’s having exercised any previously-vested stock
options prior to his employment termination.

6

 

     (d)  Voluntary Termination by Executive. In the event that Executive
voluntarily terminates employment other than for Good Reason, the Company shall
pay the following amounts to Executive:

	 	(i)	 	Any accrued but unpaid Base Salary for services rendered to
the date of termination, any accrued but unpaid expenses required to
be reimbursed under this Agreement, any accrued but unused vacation,
and any earned but unpaid bonuses for any prior period.
	 
	 	(ii)	 	Any benefits to which Executive may be entitled pursuant to
the plans, policies and arrangements (including those referred to in
Section 4(d) hereof up to the date of termination) shall be
determined and paid in accordance with the terms of such plans,
policies and arrangements.
	 
	 	(iii)	 	Any stock options that have not vested prior to the date of
such termination of employment shall be automatically cancelled as
of that date, and Executive shall have ninety (90) days following
the date of termination of employment to exercise any previously
vested options; provided that in no event will any option be
exercisable beyond its term. No stock options contemplated by this
Agreement, but not yet awarded to Executive as of the time of his
employment termination, shall be granted.

     (e)  Termination by the Company Without Cause; Termination by Executive for
Good Reason. In the event that Executive’s employment is terminated by the
Company for reasons other than death, Total Disability or Cause, or Executive
terminates his employment for Good Reason, the Company shall pay the following
amounts to Executive:

	 	(i)	 	Any accrued but unpaid Base Salary for services rendered to
the date of termination, any accrued but unpaid expenses required to
be reimbursed under this Agreement, any accrued but unused vacation,
and any earned but unpaid bonuses for any prior period.
	 
	 	(ii)	 	Any benefits to which Executive may be entitled pursuant to
the plans, policies and arrangements referred to in Section 4(d)
hereof shall be determined and paid in accordance with the terms of
such plans, policies and arrangements.
	 
	 	(iii)	 	An amount equal to two times the sum of Executive’s Base
Salary plus his Target Annual Bonus (in each case as then in
effect), of which one-half shall be paid in a lump sum within ten
(10) days after such termination and one-half shall be paid during
the two (2) year period beginning on the date of Executive’s
termination and shall be paid at the same time and in the same
manner as Base Salary would have been paid if Executive had remained
in active employment until the end of such period.
	 
	 	(iv)	 	The Company will continue for Executive and Executive’s
spouse and dependents, all health benefit plans, whether group or
individual, disability, and other similar benefit plans, in which
Executive was participating on the date of

7

 

	 	 	 	termination, until the earliest to occur of (A) two years after the
date of termination; (B) Executive’s death (provided that benefits
provided to Executive’s spouse and dependents shall not terminate
upon Executive’s death); or (C) with respect to any particular
plan, the date Executive becomes eligible to participate in a
comparable benefit provided by a subsequent employer. The first
eighteen (18) months of any medical and dental insurance coverage
provided by the Company pursuant to the foregoing sentence will be
provided pursuant to the provisions of COBRA, 29 U.S.C. §1161;
provided, however, that Executive shall only be required to pay the
normal employee premium required of similarly-situated active
employees of the Company, and the Company shall pay the difference
in the cost of the coverage directly to the medical and/or dental
plans or their administrator. Dental and health insurance coverage
for any remaining period required to be provided by the Company to
Executive hereunder shall be provided by Company pursuant to
private insurance purchased by the Company for Executive for which
the Executive shall only be required to pay an amount equal to the
premiums that Executive would be required to pay under the
Company’s dental and health insurance plans then in effect.
	 
	 	(v)	 	Executive shall continue to vest in all stock option awards
or restricted stock awards over the two (2) year period commencing
on the date of such termination. Executive shall have two (2) years
and six (6) months after the date of termination to exercise all
options to the extent then vested, provided that in no event may any
option be exercisable beyond its term.

     (f)  No Other Benefits or Compensation. Except as may be provided under
this Agreement, under the terms of any incentive compensation, employee
benefit, or fringe benefit plan applicable to Executive at the time of
Executive’s termination or resignation of employment, Executive shall have no
right to receive any other compensation, or to participate in any other plan,
arrangement or benefit, with respect to future periods after such termination
or resignation.

     (g)  No Mitigation; No Set-Off. In the event of any termination of
employment hereunder, Executive shall be under no obligation to seek other
employment and there shall be no offset against any amounts due Executive under
this Agreement on account of any remuneration attributable to any subsequent
employment that Executive may obtain. The amounts payable hereunder shall not
be subject to setoff, counterclaim, recoupment, defense or other right which
the Company may have against the Executive or others, except upon obtaining by
the Company of a final non-appealable judgment against Executive.

     7.     Resignation by Executive for Good Reason and Compensation Payable
Following Change in Control.

     (a)  Resignation for Good Reason following Change in Control. In the event
a “Change in Control” occurs and Executive terminates his employment for Good
Reason thereafter, or the Company terminates Executive’s employment other than
for Cause, or such termination for Good Reason or without Cause occurs in
contemplation of such Change in Control (any termination within six (6) months
prior to such Change in Control being presumed

8

 

 to be in contemplation unless rebutted by clear and demonstrable evidence
to the contrary), the Company shall pay the following amounts to Executive:

	 	(i)	 	The payments and benefits provided for in Section 6(e),
except that (A) the amount and period with respect to which
severance is calculated pursuant to Section 6(e)(iii) will be three
(3) years and the amount shall be paid in a lump-sum and (B) the
benefit continuation period in Section 6(e)(iv) shall be for three
years.
	 
	 	(ii)	 	In lieu of Section 6(e)(v), Executive will be 100% vested in
all benefits, awards, and grants (including stock option grants and
stock awards, all of such stock options exercisable for three (3)
years following Termination, provided that in no event will any
option be exercisable beyond its term) accrued but unpaid as of the
date of termination under any non-qualified pension plan,
supplemental and/or incentive compensation or bonus plans, in which
Executive was a participant as of the date of termination.
Executive shall also receive a bonus or incentive compensation
payment (the “bonus payment”), payable at 100% of the maximum bonus
available to Executive, pro-rated as of the effective date of the
termination. The bonus payment shall be payable within five (5)
days after the effective date of Executive’s termination. Except as
may be provided under this Section 7 or under the terms of any
incentive compensation, employee benefit, or fringe benefit plan
applicable to Executive at the time of Executive’s termination of
employment, Executive shall have no right to receive any other
compensation, or to participate in any other plan, arrangement or
benefit, with respect to future periods after such resignation or
termination.

     (b)  Certain Additional Payments by the Company.

	 	(i)	 	In the event that the Executive shall become entitled to
payments and/or benefits provided by this Agreement or any other
amounts in the “nature of compensation” (whether pursuant to the
terms of this Agreement or any other plan, arrangement or agreement
with the Company, any person whose actions result in a change of
ownership or effective control covered by Section 280G(b)(2) of the
Code or any person affiliated with the Company or such person) as a
result of such change in ownership or effective control
(collectively the “Company Payments”), and such Company Payments
will be subject to the tax (the “Excise Tax”) imposed by Section
4999 of the Code (and any similar tax that may hereafter be imposed
by any taxing authority) the Company shall pay to the Executive at
the time specified in subsection (iv) below an additional amount
(the “Gross-up Payment”) such that the net amount retained by the
Executive, after deduction of any Excise Tax on the Company Payments
and any U.S. federal, state, and for local income or payroll tax
upon the Gross-up Payment provided for by this Section 7(b), but
before deduction for any U.S. federal, state, and local income or
payroll tax on the Company Payments, shall be equal to the Company
Payments.
	 
	 	(ii)	 	For purposes of determining whether any of the Company
Payments and Gross-up Payments (collectively the “Total Payments”)
will be subject to the Excise Tax

9

 

	 	 	 	and the amount of such Excise Tax, (x) the Total Payments shall be
treated as “parachute payments” within the meaning of Section
280G(b)(2) of the Code, and all “parachute payments” in excess of
the “base amount” (as defined under Code Section 280G(b)(3) of the
Code) shall be treated as subject to the Excise Tax, unless and
except to the extent that, in the opinion of the Company’s
independent certified public accountants appointed prior to any
change in ownership (as defined under Code Section 280G(b)(2)) or
tax counsel selected by such accountants (the “Accountants”) such
Total Payments (in whole or in part) either do not constitute
“parachute payments,” represent reasonable compensation for
services actually rendered within the meaning of Section 280G(b)(4)
of the Code in excess of the “base amount” or are otherwise not
subject to the Excise Tax, and (y) the value of any non-cash
benefits or any deferred payment or benefit shall be determined by
the Accountants in accordance with the principles of Section 280G
of the Code.
	 
	 	(iii)	 	For purposes of determining the amount of the Gross-up
Payment, the Executive shall be deemed to pay U.S. federal income
taxes at the highest marginal rate of U.S. federal income taxation
in the calendar year in which the Gross-up Payment is to be made and
state and local income taxes at the highest marginal rate of
taxation in the state and locality of the Executive’s residence for
the calendar year in which the Company Payment is to be made, net of
the maximum reduction in U.S. federal income taxes which could be
obtained from deduction of such state and local taxes if paid in
such year. In the event that the Excise Tax is subsequently
determined by the Accountants to be less than the amount taken into
account hereunder at the time the Gross-up Payment is made, the
Executive shall repay to the Company, at the time that the amount of
such reduction in Excise Tax is finally determined, the portion of
the prior Gross-up Payment attributable to such reduction (plus the
portion of the Gross-up Payment attributable to the Excise Tax and
U.S. federal, state and local income tax imposed on the portion of
the Gross-up Payment being repaid by the Executive if such repayment
results in a reduction in Excise Tax or a U.S. federal, state and
local income tax deduction), plus interest on the amount of such
repayment at the rate provided in Section 1274(b)(2)(B) of the Code.
Notwithstanding the foregoing, in the event any portion of the
Gross-up Payment to be refunded to the Company has been paid to any
U.S. federal, state and local tax authority, repayment thereof (and
related amounts) shall not be required until actual refund or credit
of such portion has been made to the Executive, and interest payable
to the Company shall not exceed the interest received or credited to
the Executive by such tax authority for the period it held such
portion. The Executive and the Company shall mutually agree upon
the course of action to be pursued (and the method of allocating the
expense thereof) if the Executive’s claim for refund or credit is
denied.
	 
	 	 	 	In the event that the Excise Tax is later determined by the
Accountant or the Internal Revenue Service to exceed the amount
taken into account hereunder at the time the Gross-up Payment is
made (including by reason of any payment the existence or amount of
which cannot be determined at the time of the Gross-up Payment),
the Company shall make an additional Gross-up Payment in respect of

10

 

	 	 	 	such excess (plus any interest or penalties payable with respect to
such excess) at the time that the amount of such excess is finally
determined.
	 
	 	(iv)	 	The Gross-up Payment or portion thereof provided for in
subsection (iii) above shall be paid not later than the thirtieth
(30th) day following an event occurring which subjects the Executive
to the Excise Tax; provided, however, that if the amount of such
Gross-up Payment or portion thereof cannot be finally determined on
or before such day, the Company shall pay to the Executive on such
day an estimate, as determined in good faith by the Accountant, of
the minimum amount of such payments and shall pay the remainder of
such payments (together with interest at the rate provided in
Section 1274(b)(2)(B) of the Code), subject to further payments
pursuant to subsection (iii) hereof, as soon as the amount thereof
can reasonably be determined, but in no event later than the
ninetieth day after the occurrence of the event subjecting the
Executive to the Excise Tax. In the event that the amount of the
estimated payments exceeds the amount subsequently determined to
have been due, such excess shall constitute a loan by the Company to
the Executive, payable on the fifth day after demand by the Company
(together with interest at the rate provided in Section
1274(b)(2)(B) of the Code).
	 
	 	(v)	 	In the event of any controversy with the Internal Revenue
Service (or other taxing authority) with regard to the Excise Tax,
the Executive shall permit the Company to control issues related to
the Excise Tax (at its expense), provided that such issues do not
potentially materially adversely affect the Executive, but the
Executive shall control any other issues. In the event the issues
are interrelated, the Executive and the Company shall in good faith
cooperate so as not to jeopardize resolution of either issue, but if
the parties cannot agree the Executive shall make the final
determination with regard to the issues. In the event of any
conference with any taxing authority as to the Excise Tax or
associated income taxes, the Executive shall permit the
representative of the Company to accompany the Executive, and the
Executive and the Executive’s representative shall cooperate with
the Company and its representative.
	 
	 	(vi)	 	The Company shall be responsible for all charges of the
Accountant.
	 
	 	(vii)	 	The Company and the Executive shall promptly deliver to each
other copies of any written communications, and summaries of any
verbal communications, with any taxing authority regarding the
Excise Tax covered by this Section 7(b).

     (c)     Change in Control. For purposes of this Agreement, “Change in
Control” means the occurrence of any of the following events:

	 	(i)	 	any Person is or becomes the Beneficial Owner, directly or
indirectly, of securities of WMI (not including in the securities
beneficially owned by such person any securities acquired directly
from WMI or its Affiliates) representing twenty-five percent (25%)
or more of the combined voting power of WMI’s then outstanding
voting securities;

11

 

	 	(ii)	 	the following individuals cease for any reason to constitute
a majority of the number of directors then serving: individuals who,
on the Employment Date, constitute the Board of WMI and any new
director (other than a director whose initial assumption of office
is in connection with an actual or threatened election contest,
including but not limited to a consent solicitation, relating to the
election of directors of WMI) whose appointment or election by the
Board or nomination for election by WMI’s stockholders was approved
or recommended by a vote of the at least two-thirds (2/3rds) of the
directors then still in office who either were directors on the
Employment Date or whose appointment, election or nomination for
election was previously so approved or recommended;
	 
	 	(iii)	 	there is a consummated merger or consolidation of the
Company pursuant to which no securities of the Company are owned by
WMI or its direct or indirect subsidiaries, or a merger or
consolidation of WMI or any direct or indirect subsidiary of WMI
(other than the Company) with any other corporation, other than (A)
a merger or consolidation which would result in the voting
securities of WMI outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being converted
into voting securities of the surviving or parent entity) more than
fifty percent (50%) of the combined voting power of the voting
securities of WMI or such surviving or parent entity outstanding
immediately after such merger or consolidation or (B) a merger or
consolidation effected to implement a recapitalization of WMI (or
similar transaction) in which no Person, directly or indirectly,
acquired twenty-five percent (25%) or more of the combined voting
power of WMI’s then outstanding securities (not including in the
securities beneficially owned by such person any securities acquired
directly from WMI or its Affiliates); or
	 
	 	(iv)	 	the stock holders of the Company or WMI approve a plan of
complete liquidation of the Company or WMI or there is consummated
an agreement for the sale or disposition by the Company or WMI of
all or substantially all of the Company’s or WMI’s assets (or any
transaction having a similar effect), other than a sale or
disposition by the Company or WMI of all or substantially all of the
Company’s or WMI’s assets to an entity, at least fifty percent (50%)
of the combined voting power of the voting securities of which are
owned by stockholders of the Company or WMI in substantially the
same proportions as their ownership of the Company or WMI
immediately prior to such sale.

     For purposes of this Section 7(c), the following terms shall have the
following meanings:

	 	 	 	(i)   “Affiliate” shall mean an affiliate of WMI, as defined in Rule
12b-2 promulgated under Section 12 of the Securities Exchange Act
of 1934, as amended from time to time (the “Exchange Act”);
	 
	 	 	 	(ii)  “Beneficial Owner” shall have the meaning set forth in Rule
13d-3 under the Exchange Act;
	 
	 	 	 	(iii) “Person” shall have the meaning set forth in Section 3(a)(9)
of the

12

 

	 	 	 	Exchange Act, as modified and used in Sections 13(d) and 14(d)
thereof, except that such term shall not include (1) WMI, (2) a
trustee or other fiduciary holding securities under an employee
benefit plan of WMI, (3) an underwriter temporarily holding
securities pursuant to an offering of such securities or (4) a
corporation owned, directly or indirectly, by the stockholders of
WMI in substantially the same proportions as their ownership of
shares of Common Stock of WMI.

     8.     Covenants

     (a)  This Agreement. The terms of this Agreement constitute Confidential
Information, which Executive shall not disclose to anyone other than
Executive’s spouse, attorneys, advisors, or as required by law. Disclosure of
these terms is a material breach of this Agreement and could subject Executive
to disciplinary action, including without limitation, termination of employment
for Cause.

     (b)  Company Property. All written materials, records, data, and other
documents prepared or possessed by Executive during Executive’s employment with
the Company are the Company’s property. All information, ideas, concepts,
improvements, discoveries, and inventions that are conceived, made, developed,
or acquired by Executive individually or in conjunction with others during
Executive’s employment (whether during business hours and whether on the
Company’s premises or otherwise) which relate to the Company’s business,
products, or services are the Company’s sole and exclusive property. All
memoranda, notes, records, files, correspondence, drawings, manuals, models,
specifications, computer programs, maps, and all other documents, data, or
materials of any type embodying such information, ideas, concepts,
improvements, discoveries, and inventions are the Company’s property. At the
termination of Executive’s employment with the Company for any reason,
Executive shall return all of the Company’s documents, data, or other Company
property to the Company.

     (c)  Confidential Information; Non-Disclosure. Executive acknowledges that
the business of the Company is highly competitive and that the Company has
agreed to provide and immediately will provide Executive with access to
“Confidential Information” relating to the business of the Company, WMI, and
their respective affiliates.

     For purposes of this Agreement, “Confidential Information” means and
includes the Company’s and WMI’s confidential and/or proprietary information
and/or trade secrets that have been developed or used and/or will be developed
and that cannot be obtained readily by third parties from outside sources.
Confidential Information includes, by way of example and without limitation,
the following information regarding customers, employees, contractors, and the
industry not generally known to the public; strategies, methods, books,
records, and documents; technical information concerning products, equipment,
services, and processes; procurement procedures and pricing techniques; the
names of and other information concerning customers, investors, and business
affiliates (such as contact name, service provided, pricing for that customer,
type and amount of services used, credit and financial data, and/or other
information relating to the Company’s relationship with that customer); pricing
strategies and price curves; positions, plans, and strategies for expansion or
acquisitions; budgets; customer lists; research; weather data; financial and
sales data; trading methodologies and terms; evaluations, opinions, and
interpretations of information and data; marketing and merchandising
techniques;

13

 

 prospective customers’ names and marks; grids and maps; electronic
databases; models; specifications; computer programs; internal business
records; contracts benefiting or obligating the Company; bids or proposals
submitted to any third party; technologies and methods; training methods and
training processes; organizational structure; personnel information, including
salaries of personnel; payment amounts or rates paid to consultants or other
service providers; and other such confidential or proprietary information.
Information need not qualify as a trade secret to be protected as Confidential
Information under this Agreement, and the authorized and controlled disclosure
of Confidential Information to authorized parties by Company in the pursuit of
its business will not cause the information to lose its protected status under
this Agreement. Executive acknowledges that this Confidential Information
constitutes a valuable, special, and unique asset used by the Company, WMI, and
their respective affiliates in their businesses to obtain a competitive
advantage over their competitors. Executive further acknowledges that
protection of such Confidential Information against unauthorized disclosure and
use is of critical importance to the Company, WMI, and their respective
affiliates in maintaining their competitive position.

     Executive also will have access to, or knowledge of, Confidential
Information of third parties, such as actual and potential customers,
suppliers, partners, joint venturers, investors, financing sources, and the
like, of the Company, WMI, and their affiliates.

     The Company also agrees to provide Executive with one or more of the
following: access to Confidential Information, specialized training regarding
the Company’s and WMI’s methodologies and business strategies, and/or support
in the development of goodwill such as introductions, information and
reimbursement of customer development expenses consistent with Company policy.
The foregoing is not contingent on continued employment, but is contingent upon
Executive’s use of the Confidential Information access, specialized training,
and goodwill support provided by Company for the exclusive benefit of the
Company and upon Executive’s full compliance with the restrictions on
Executive’s conduct provided for in this Agreement.

     In addition to the requirements set forth in Section 5(c)(i), Executive
agrees that Executive will not after Executive’s employment with the Company,
make any unauthorized disclosure of any then Confidential Information or
specialized training of the Company, WMI, or their respective affiliates, or
make any use thereof, except in the carrying out of his employment
responsibilities hereunder. Executive also agrees to preserve and protect the
confidentiality of third party Confidential Information to the same extent, and
on the same basis, as the Company’s Confidential Information.

     (d)  Unfair Competition Restrictions. Upon Executive’s Employment Date,
the Company agrees to and shall provide Executive with immediate access to
Confidential Information. Ancillary to the rights provided to Executive
following employment termination, the Company’s provision of Confidential
Information, specialized training, and/or goodwill support to Executive, and
Executive’s agreements, regarding the use of same, and in order to protect the
value of the above-referenced stock options, training, goodwill support and/or
the Confidential Information described above, the Company and Executive agree
to the following provisions against unfair competition. Executive agrees that
for a period of two (2) years following the termination of employment for any
reason (“Restricted Term”), Executive will not, directly or indirectly, for
Executive or for others, anywhere in the United States (including all

14

 

 parishes in Louisiana) (the “Restricted Area”) do the following, unless
expressly authorized to do so in writing by the Chief Executive Officer:

	 
	Engage in, or assist any person, entity, or business
engaged in, the selling or providing of products or
services that would displace the products or services
that (i) the Company or WMI are currently in the
business of providing and were in the business of
providing, or were planning to be in the business of
providing, at the time Executive was employed with the
Company, and (ii) that Executive had involvement in or
received Confidential Information about in the course
of employment; the foregoing is expressly understood
to include, without limitation, the business of the
collection, transfer, recycling and resource recovery,
or disposal of solid waste, including the operation of
waste-to-energy facilities and alternative energy
facilities, and trading or hedging of positions
(physical and financial) in any fiber or fiber-related
materials, including, but not limited to, those
marketed or traded by the Company

     It is further agreed that during the Restricted Term, Executive cannot
engage in any of the enumerated prohibited activities in the Restricted Area by
means of telephone, telecommunications, satellite communications,
correspondence, or other contact from outside the Restricted Area. Executive
further understands that the foregoing restrictions may limit his ability to
engage in certain businesses during the Restricted Term, but acknowledges that
these restrictions are necessary to protect the Confidential Information the
Company and WMI have provided to Executive.

     A failure to comply with the foregoing restrictions will create a
presumption that Executive is engaging in unfair competition. Executive agrees
that this Section defining unfair competition with the Company or with WMI does
not prevent Executive from using and offering the skills that Executive
possessed prior to receiving access to Confidential Information, confidential
training, and knowledge from the Company and WMI. This Agreement creates an
advance approval process, and nothing herein is intended, or will be construed
as, a general restriction against the pursuit of lawful employment in violation
of any controlling state or federal laws. Executive shall be permitted to
engage in activities that would otherwise be prohibited by this covenant if
such activities are determined in the sole discretion of the Chief Executive
Officer to be no material threat to the legitimate business interests of the
Company or WMI.

     (e)  Non-Solicitation of Customers. For a period of two (2) years
following the termination of employment for any reason, Executive will not call
on, service, or solicit competing business from customers of the Company, WMI,
or their respective affiliates whom Executive, within the previous twelve (12)
months, (i) had or made contact with, or (ii) had access to information and
files about, or induce or encourage any such customer or other source of
ongoing business to stop doing business with the Company or WMI.

15

 

     (f)  Non-Solicitation of Employees. During Executive’s employment, and for
a period of two (2) years following the termination of employment for any
reason, Executive will not, either directly or indirectly, call on, solicit,
encourage, or induce any other employee or officer of the Company, WMI, or
their respective affiliates whom Executive had contact with, knowledge of, or
association within the course of employment with the Company to terminate his
or her employment, and will not assist any other person or entity in such a
solicitation.

     (g)  Non-Disparagement. Executive covenants and agrees that Executive
shall not engage in any pattern of conduct that involves the making or
publishing of written or oral statements or remarks (including, without
limitation, the repetition or distribution of derogatory rumors, allegations,
negative reports or comments) which are disparaging, deleterious or damaging to
the integrity, reputation or good will of the Company or WMI, their respective
management, or of management of corporations affiliated with the Company or
WMI.

     9.     Enforcement of Covenants.

     (a)  Termination of Employment and Forfeiture of Compensation. Executive
agrees that any breach by Executive of any of the covenants set forth in
Section 8 hereof during Executive’s employment by the Company, shall be grounds
for immediate dismissal of Executive for Cause pursuant to Section 5(c)(i),
which shall be in addition to and not exclusive of any and all other rights and
remedies the Company may have against Executive.

     (b)  Right to Injunction. Executive acknowledges that a breach of the
covenants set forth in Section 8 hereof will cause irreparable damage to the
Company and/or WMI with respect to which the remedy at law for damages will be
inadequate. Therefore, in the event of breach or anticipatory breach of the
covenants set forth in this Section 8 by Executive, Executive and the Company
agree that the Company and/or WMI shall be entitled to seek the following
particular forms of relief, in addition to remedies otherwise available to it
at law or equity: (A) injunctions, both preliminary and permanent, enjoining or
restraining such breach or anticipatory breach and Executive hereby consents to
the issuance thereof forthwith and without bond by any court of competent
jurisdiction; and (B) recovery of all reasonable sums as determined by a court
of competent jurisdiction expended and costs, including reasonable attorney’s
fees, incurred by the Company and/or WMI to enforce the covenants set forth in
this section.

     (c)  Separability of Covenants. The covenants contained in Section 8
hereof constitute a series of separate but ancillary covenants, one for each
applicable State in the United States and the District of Columbia, and one for
each applicable foreign country. If in any judicial proceeding, a court shall
hold that any of the covenants set forth in Section 8 exceed the time,
geographic, or occupational limitations permitted by applicable laws, Executive
and the Company agree that such provisions shall and are hereby reformed to the
maximum time, geographic, or occupational limitations permitted by such laws.
Further, in the event a court shall hold unenforceable any of the separate
covenants deemed included herein, then such unenforceable covenant or covenants
shall be deemed eliminated from the provisions of this Agreement for the
purpose of such proceeding to the extent necessary to permit the remaining
separate covenants to be enforced in such proceeding. Executive and the
Company further agree that the covenants in Section 8 shall each be construed
as a separate agreement independent of any other provisions of this Agreement,
and the existence of any claim or cause of action by

16

 

 Executive against the Company or WMI whether predicated on this Agreement
or otherwise, shall not constitute a defense to the enforcement by the Company
of any of the covenants of Section 8.

     10.     Indemnification.

     The Company shall indemnify and hold harmless Executive to the fullest
extent permitted by Delaware law for any action or inaction of Executive while
serving as an officer or director of the Company or, at the Company’s request,
as an officer or director of any other entity or as a fiduciary of any benefit
plan. This provision includes the obligation and undertaking of the Executive
to reimburse the Company for any fees advanced by the Company on behalf of the
Executive should it later be determined that Executive was not entitled to have
such fees advanced by the Company under Delaware law. The Company shall cover
the Executive under directors and officers liability insurance both during and,
while potential liability exists, after the Employment Period in the same
amount and to the same extent as the Company covers its other officers and
directors.

     11.     Disputes and Payment of Attorney’s Fees.

     If at any time during the term of this Agreement or afterwards there
should arise any dispute as to the validity, interpretation or application of
any term or condition of this Agreement, the Company agrees, upon written
demand by Executive (and Executive shall be entitled upon application to any
court of competent jurisdiction, to the entry of a mandatory injunction,
without the necessity of posting any bond with respect thereto, compelling the
Company) to promptly provide sums sufficient to pay on a current basis (either
directly or by reimbursing Executive) Executive’s costs and reasonable
attorney’s fees (including expenses of investigation and disbursements for the
fees and expenses of experts, etc.) incurred by Executive in connection with
any such dispute or any litigation, provided that Executive shall repay any
such amounts paid or advanced if Executive is not the prevailing party with
respect to at least one material claim or issue in such dispute or litigation.
The provisions of this Section 11, without implication as to any other section
hereof, shall survive the expiration or termination of this Agreement and of
Executive’s employment hereunder.

     12.     Withholding of Taxes.

     The Company may withhold from any compensation and benefits payable under
this Agreement all applicable federal, state, local, or other taxes.

     13.     Source of Payments.

     All payments provided under this Agreement, other than payments made
pursuant to a plan which provides otherwise, shall be paid from the general
funds of the Company, and no special or separate fund shall be established, and
no other segregation of assets made, to assure payment. Executive shall have
no right, title or interest whatever in or to any investments which the Company
may make to aid the Company in meeting its obligations hereunder. To the
extent that any person acquires a right to receive payments from the Company
hereunder, such right shall be no greater than the right of an unsecured
creditor of the Company.

17

 

     14.     Assignment.

     Except as otherwise provided in this Agreement, this Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
heirs, representatives, successors and assigns. This Agreement shall not be
assignable by Executive (but any payments due hereunder which would be payable
at a time after Executive’s death shall be paid to Executive’s designated
beneficiary or, if none, his estate) and shall be assignable by the Company
only to any financially solvent corporation or other entity resulting from the
reorganization, merger or consolidation of the Company with any other
corporation or entity or any corporation or entity to or with which the
Company’s business or substantially all of its business or assets may be sold,
exchanged or transferred, and it must be so assigned by the Company to, and
accepted as binding upon it by, such other corporation or entity in connection
with any such reorganization, merger, consolidation, sale, exchange or transfer
in a writing delivered to Executive in a form reasonably acceptable to
Executive (the provisions of this sentence also being applicable to any
successive such transaction).

     15.     Entire Agreement; Amendment.

     This Agreement shall supersede any and all existing oral or written
agreements, representations, or warranties between Executive and the Company,
WMI, or any of their respective parent, subsidiaries or affiliated entities
relating to the terms of Executive’s employment by the Company or WMI. It may
not be amended except by a written agreement signed by both parties.

     16.     Governing Law.

     This Agreement shall be governed by and construed in accordance with the
laws of the State of Texas applicable to agreements made and to be performed in
that State, without regard to its conflict of laws provisions.

     17.     Requirement of Timely Payments.

     If any amounts which are required, or determined to be paid or payable, or
reimbursed or reimbursable, to Executive under this Agreement (or any other
plan, agreement, policy or arrangement with the Company) are not so paid
promptly at the times provided herein or therein, such amounts shall accrue
interest, compounded daily, at an 8% annual percentage rate, from the date such
amounts were required or determined to have been paid or payable, reimbursed or
reimbursable to Executive, until such amounts and any interest accrued thereon
are finally and fully paid, provided, however, that in no event shall the
amount of interest contracted for, charged or received hereunder, exceed the
maximum non-usurious amount of interest allowed by applicable law.

     18.     Notices.

     Any notice, consent, request or other communication made or given in
connection with this Agreement shall be in writing and shall be deemed to have
been duly given when delivered

18

 

 or mailed by registered or certified mail, return receipt requested, or by
facsimile or by hand delivery, to those listed below at their following
respective addresses or at such other address as each may specify by notice to
the others:

	 	 	 	 	 
	 	 	
To the Company:
	 	Recycle America Alliance, L.L.C.
	 	 	 	 	1001 Fannin, Suite 4000
	 	 	 	 	Houston, Texas 77002
	 	 	 	 	Attention: Corporate Secretary
	 	 	 	 	 
	 	 	
Copy to WMI:
	 	Waste Management , Inc.
	 	 	 	 	1001 Fannin, Suite 4000
	 	 	 	 	Houston, Texas 77002
	 	 	 	 	Attention: Corporate Secretary
	 	 	 	 	 
	 	 	
To Executive:
	 	At the address for Executive set forth below.

     19.     Miscellaneous.

     (a)  Waiver. The failure of a party to insist upon strict adherence to any
term of this Agreement on any occasion shall not be considered a waiver thereof
or deprive that party of the right thereafter to insist upon strict adherence
to that term or any other term of this Agreement.

     (b)  Separability. Subject to Section 9 hereof, if any term or provision
of this Agreement is declared illegal or unenforceable by any court of
competent jurisdiction and cannot be modified to be enforceable, such term or
provision shall immediately become null and void, leaving the remainder of this
Agreement in full force and effect.

     (c)  Headings. Section headings are used herein for convenience of
reference only and shall not affect the meaning of any provision of this
Agreement.

     (d)  Rules of Construction. Whenever the context so requires, the use of
the singular shall be deemed to include the plural and vice versa.

     (e)  Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, and
such counterparts will together constitute but one Agreement.

19

 

     IN WITNESS WHEREOF, this Agreement is EXECUTED and EFFECTIVE as of the day
set forth above.

	 	STEVE RAGIEL

(“Executive”)

	 	/s/ Steve Ragiel	 
	 	

	 	Steve Ragiel	 

	 	2740 Centenary St	  (address)
	 	
	 

	 	Houston, Texas 77005	 
	 	

	 	RECYCLE AMERICA ALLIANCE, L.L.C.

(The “Company”)

	 	 	 	 
	 	By:	
/s/ A. Maurice Myers	 
	 	 	

	 	 	
A. Maurice Myers	 
	 	 	
On Behalf of the Board of Managers	 

20

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