Document:

Exhibit 10.10

 

EMPLOYMENT AGREEMENT

 

AGREEMENT  by and between
Safety-Kleen Systems, Inc., a Wisconsin corporation (the “Company”),
Safety-Kleen HoldCo., Inc. (“SK HoldCo”) and Steven  H. Grimshaw (the “Executive”), dated as of
the 20th day of May, 2006 (the “Effective Date”).

 

WHEREAS, the Company has determined that it is in
the best interests of the Company to employ the Executive as the Executive Vice
President of the Company and SK HoldCo, and
Executive desires to serve the Company in that capacity pursuant to the terms
set forth herein.

 

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

 

1.             Employment Period.  The Company shall employ the Executive, and
the Executive shall serve the Company, on the terms and conditions set forth in
this Agreement, during the employment period which shall begin on the Effective
Date and continue for two years unless earlier terminated pursuant to the terms
of this Agreement (the “Employment Period”). This Agreement may be renewed, and
the Employment Period thereby extended if not previously terminated pursuant to
the terms hereof, by the Company upon the same terms and conditions as
contained herein, upon at least sixty (60) days written notice to Executive
prior to the end of the expiring term of the Employment Period.

 

2.             Position and Duties.  During the
Employment Period, the Executive shall serve as Executive Vice President of the
Company and SK  HoldCo and in substantially similar positions in the
subsidiaries and affiliates of the Company, with the duties, functions, responsibilities
and authority customarily associated with such positions. During the Employment
Period, the Executive will devote substantially all of his attention and time
to the business and affairs of the Company, excluding any periods of vacation
and sick leave to which Executive is entitled, and will not engage in any other
business activities that will unreasonably interfere with the Executive’s
employment pursuant to this Agreement. 
During the Employment Period, Executive will be based out of the Company’s
offices in Plano, Texas, and the Executive’s services shall be performed at
such locations where the Company conducts business throughout North America as
the needs and exigencies of the business of the Company from time to time
reasonably require. However, Executive will not be required by the Company to
relocate from his current residence in the Plano, Texas area.

 

3.             Compensation.

 

(a)           Salary.  From the Effective
Date through the end of the Employment Period, the Executive shall receive an
annual base salary (the “Salary”) of $310,500 payable in accordance with the
Company’s normal payroll practices for executives. Executive will receive an
annual performance review in accordance with the Company’s annual performance
review and merit increase process, and may receive a corresponding Salary
increase at such time. Any new salary due to any such increase will thereafter
be deemed the “Salary” for purposes of this Agreement.

 

(b)           Annual Bonus. 
Executive will have an annual target Merit Incentive Plan bonus (the “MIP
Bonus”) percentage of 100% of his Salary (the “Bonus”). The Bonus will be
subject to

 

 

the terms and conditions of
the MIP Bonus program approved by the SK HoldCo Board of Directors each year.

 

(c)           Other Benefits. 
During the Employment Period: (i) the Executive shall be entitled
to participate in the Company’s 401-k Plan, applicable fringe benefit programs
and other benefit plans, policies and programs of the Company applicable to
Executive as may be amended by the Company from time to time; and (ii) the
Executive shall be entitled to four weeks of vacation annually, effective and
vested on January 1 of each year during the Employment Period.

 

(d)           Programs, Procedures and Policies.  Executive will comply with and be bound by
the Company’s applicable current and future programs, procedures, plans and
policies, as may be amended by the Company from time to time, except to the
extent such programs, procedures, plans or policies are contrary to the terms
and conditions of this Agreement.

 

4.             Termination
of Employment.

 

(a)           Death or Disability. In the event of the
Executive’s death during the Employment Period, the Executive’s employment with
the Company shall terminate automatically. In addition, the Company shall have
the right to terminate the Executive’s employment because of the Executive’s
Disability (as defined in the Company’s Long Term Disability Benefit Plan)
during the Employment Period. A termination of the Executive’s employment by
the Company for Disability shall be communicated to the Executive by written
notice, and shall be effective on the 5th day after receipt of such notice by
the Executive (the “Disability Effective Date”), unless the Executive returns
to full-time performance of the Executive’s duties before the Disability Effective
Date.

 

(b)           By the Company. 
In addition to termination for death or Disability, the Company may
terminate the Executive’s employment during the Employment Period with Cause,
after receipt of written notice to Executive and a reasonable opportunity to
cure, or without Cause.  For purposes of
this Agreement, “Cause” means:

 

(i)                                     the
willful and continued failure by Executive substantially to perform his duties
with the Company (other than any such failure resulting from Disability or
other causes beyond Executive’s reasonable control); or

 

(ii)                                  the
willful engaging by Executive in conduct that is demonstrably and materially
injurious to the Company, monetarily or otherwise; or

 

(iii)                               the
material failure of Executive to comply with the terms and conditions of this
Agreement. 

 

(c)           Voluntarily by the Executive.  The Executive may voluntarily terminate his
employment at any time during the Employment Period by giving not less than sixty
(60) days prior written notice thereof to the Company.

 

(d)           Date of Termination.  The “Date of Termination” means the last day
of the Employment Period if not otherwise terminated early pursuant to any
provision of this Agreement (“End of the Term”), the date of the Executive’s
death, the Disability Effective Date, 

 

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the date on which the
termination of the Executive’s employment by the Company with Cause or without
Cause is effective, or the date on which the voluntary termination of the
Executive’s employment by Executive is effective, as the case may be.

 

5.             Obligations of the Company on Termination.

 

(a)           If the Executive’s employment is terminated (i) due to the Company
failing to renew this Agreement in accordance with its terms at least sixty
(60) days prior to the End of the Term; (ii) by the Company for any reason
other than the Executive’s death, Disability or Cause, or (iii) due to
Executive resigning because the Company materially fails to comply with the
terms and conditions of this Agreement after notice from Executive and a
reasonable opportunity to cure such matter, the Company shall, upon execution
by Executive of a general release, pay to the
Executive within 10 days after the Date of Termination, a lump-sum cash amount
equal to the sum of any portion of the Salary and any other compensation earned
for the period up to the Date of Termination that has not yet been paid, the
cash equivalent of any accrued but unused vacation, and one year’s worth of
Salary.  Further, (x) all unvested
Options granted to Executive by SK HoldCo that are scheduled to vest in the
year after the Date of Termination, will vest prorate for that year, (y)  the
MIP Bonus payment for the year in which the Date of Termination occurs, will be
payable to Executive when and as paid to other Company employees, and will be
calculated as if Executive remained employed with the Company the entire MIP
year (i.e., not prorated for length of employment in that MIP year), and (z) provided
Executive elects continued health insurance coverage through COBRA, the Company
will pay the monthly COBRA contributions for Executive and his family for health
insurance coverage, as may be amended from time to time, (less an amount equal
to the premium contribution paid by active Company employees) during such one
year period; provided, however, that if at any time Executive becomes eligible
for health insurance through subsequent employment or otherwise, the Company’s
health benefit obligations shall immediately cease, and the Company shall have
no further obligation to make COBRA contributions on Executive’s behalf.

 

(b)           Cause; Voluntary Termination. If the
Executive’s employment is terminated (i) due to the Executive’s death or
Disability, (ii) for Cause by the Company, or (iii) by the Executive
voluntarily during the Employment Period, the Company shall pay the Executive,
within 10 days after the Date of Termination, a lump-sum cash amount equal to
the sum of any portion of the Salary and any other compensation earned for the
period up to the Date of Termination that has not yet been paid, plus the cash
equivalent of any accrued but unused vacation.

 

(c)           In addition to the payments and benefits to which the Executive or the
Executive’s estate may be entitled under Sections 5(a) and (b) above
and Section 5(d) below, the Executive shall be entitled to receive
any vested or other benefits to which he may be entitled pursuant to the terms
and conditions of the Company’s 401-k Plan and any Company Life, Disability or
Health Insurance Plan in which he may participate, and any other amounts due
under this Agreement.

 

(d)           Change in
Control.  If Executive’s employment ends due to
any of the items listed in Section 5(a) after or in anticipation of a
Change in Control (as defined below), instead of the amounts in Section 5(a),
the Company shall, upon execution by Executive of the Company’s 

 

3

 

settlement agreement and
general release, pay to the Executive within 10 days after the Date of
Termination, a lump-sum cash amount equal to the sum of any portion of the
Salary and any other compensation earned for the period up to the Date of
Termination that has not yet been paid, the cash equivalent of any accrued but
unused vacation, and two (2) year’s Salary. Further, (a) all unvested
Options granted to Executive by SK HoldCo will fully vest upon such Date of
Termination, (b) the MIP Bonus payment for the year in which the Date of
Termination occurs, will be payable to Executive on a prorata basis when and as
paid to other Company employees, and (c) provided Executive elects
continued health insurance coverage through COBRA, the Company will pay
Executive’s monthly COBRA contributions for health insurance coverage, as may
be amended from time to time, (less an amount equal to the premium contribution
paid by active Company employees) during such two year period; provided,
however, that if at any time Executive becomes eligible for health insurance
through subsequent employment or otherwise, the Company’s health benefit
obligations shall immediately cease, and the Company shall have no further
obligation to make COBRA contributions on Executive’s behalf. A “Change of
Control” for purposes of this Agreement means the sale, monetization or other
disposition of all or substantially all (greater than 50%) of the assets of the
Company or SK HoldCo, or if a “person” or “group” (within the meaning of
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
in effect from time to time) becomes the beneficial owner (as defined in Rule 13d-3
under the Securities Exchange Act of 1934, as in effect from time to time),
directly or indirectly, of more than 66 2/3 % of the common stock of SK HoldCo
having the right to vote for the election of members of the SK HoldCo Board of
Directors (but shall not include any initial or secondary public offering of SK
HoldCo stock under the 1933 Securities Act, as in effect from time to time). Notwithstanding
the foregoing, if the definition of “Change of Control” in the Company’s Equity
Plan (as amended from time to time) is more favorable to the Executive, then
such definition shall be controlling for purposes of this Agreement.  If Executive’s employment ends due to any of
the items listed in Section 5(a) within six (6) months prior to
a Change of Control, it will be deemed to be “in anticipation of a Change of
Control” for purposes of this paragraph.

 

6.             Confidentiality and Noncompetition. Executive
agrees to execute, comply with and be bound by the Non-disclosure,
Non-solicitation and Non-competition Agreement attached hereto as Exhibit “A”
and incorporated herein by reference. Executive will treat the terms of this
Agreement as strictly confidential, and will not disclose the same to any
Company employees other than those involved in the preparation and negotiation
of this Agreement.

 

7.             Successors.  (a) This
Agreement is personal to the Executive and, without the prior written consent
of the Company, shall not be assignable by the Executive otherwise than by will
or the laws of descent and distribution. This Agreement shall inure to the
benefit of and be enforceable by the Executive’s legal representatives.

 

(b)  This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns. The Company shall
not assign this Agreement without the prior written consent of the Executive,
which consent shall not be unreasonably withheld.

 

8.             Miscellaneous. (a) The captions of this
Agreement are not part of the provisions hereof and shall have no force or
effect. This Agreement may not be amended or modified 

 

4

 

except by
a written agreement executed by the parties hereto or their respective
successors and legal representatives.

 

(b)           All notices and other communications under this Agreement shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:

 

	
  If to the Executive:

  	
   

  	
  Steven H. Grimshaw

  
	
   

  	
   

  	
  [Address on file with the Company]

  
	
   

  	
   

  	
   

  
	
  If to the Company or SK HoldCo:

  	
   

  	
  Safety-Kleen Systems, Inc.

  
	
   

  	
   

  	
  5400 Legacy Drive,

  
	
   

  	
   

  	
  Cluster II, Building 3

  
	
   

  	
   

  	
  Plano, Texas 75024

  
	
   

  	
   

  	
  Attention: General Counsel

  

 

or to such
other address as either party furnishes to the other in writing in accordance with
this paragraph (b) of Section 8. Notices and communications shall be
effective when actually received by the addressee.

 

(c)           The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement. If any provision of this Agreement shall be held invalid or
unenforceable in part, the remaining portion of such provision, together with
all other provisions of this Agreement, shall remain valid and enforceable and
continue in full force and effect to the fullest extent consistent with law.

 

(d)           Notwithstanding any other provision of this Agreement, the Company may
withhold from amounts payable under this Agreement all federal, state, local
and foreign taxes that are required to be withheld by applicable laws or
regulations.

 

(e)           The Executive’s or the Company’s failure to insist upon strict compliance
with any provision of, or to assert any right under, this Agreement shall not
be deemed to be a waiver of such provision or right or of any other provision
of or right under this Agreement.

 

(f)            The Executive and the Company acknowledge that this Agreement supersedes
any other agreement, whether written or oral, between them concerning the
subject matter hereof, including any prior employment agreement, severance
agreement or plan, and change of control agreement or plan.

 

(g)           This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Delaware without reference to principles of conflict of laws.

 

(h)           This Agreement may be executed in several counterparts, each of which shall
be deemed an original and said counterparts shall constitute but one and the
same instrument.

 

5

 

IN WITNESS WHEREOF, the Executive has hereunto set the
Executive’s hand, and the Company and SK HoldCo have caused this Agreement
to be executed in their names on their behalf, all as of the day and year first
above written.

 

	
   

  	
   /s/ Steven H. Grimshaw

  
	
   

  	
  Steven
  H. Grimshaw, Executive

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SAFETY-KLEEN SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Frederick
  J. Florjancic, Jr.

  
	
   

  	
   

  	
  Frederick J.
  Florjancic, Jr.

  
	
   

  	
   

  	
  Chief Executive Officer and President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SAFETY-KLEEN HOLDCO., INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Frederick J. Florjancic, Jr.

  
	
   

  	
   

  	
  Frederick J.
  Florjancic, Jr.

  
	
   

  	
   

  	
  Chief Executive Officer and President

  

 

6

 

	
  

  	
   

  	
  Frederick J. Florjancic, Jr. 

  President and Chief   

  Executive Officer   

  
	
   

  	
   

  
	
   

  	
  December 5, 2006

  

 

Steve Grimshaw

Executive Vice President

Safety-Kleen Systems, Inc.

5400 Legacy Drive

Plano, TX 75024

 

Re:                               Amendment to Employment
Agreement dated May 20, 2006 (the “Employment Agreement”)

 

Dear
Steve,

 

The
purpose of this letter is to confirm the decision of the Human Resource and
Compensation Committee to amend certain provisions of the Employment Agreement
as follows:

 

A.                                   The “Employment
Period” under the Employment Agreement is extended until December 31,
2009.

 

B.                                     Section 3(b) of
the Employment Agreement is amended in its entirety as follows effective as of January 1,
2007 (for clarification, this amendment does not modify the Executive’s annual
bonus applicable to the 2006 MIP Plan year):

 

	
   

  	
  3.

  	
  Compensation.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ...

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  Annual
  Bonus. 
  Executive will have an annual bonus as a percentage of Salary (the
  “Bonus”) as follows:

  
							

 

	
  Plan

  	
   

  	
  Plan +

  	
   

  	
  Plan ++

  
	
        67%      

  	
   

  	
        133%      

  	
   

  	
        200%      

  

 

	
  The
  Bonus will be subject to the terms and conditions of the annual bonus program
  approved by the SK Holdco Board of Directors each year.

  

 

SAFETY-KLEEN HOLDCO, INC.

5400 LEGACY DRIVE, CII B3         
PLANO, TX 75024         
972-265-2000

 

 

	
  

  	
   

  	
  Frederick J. Florjancic, Jr. 

  President and Chief   

  Executive Officer   

  

 

All
other terms and conditions of the Employment Agreement as amended shall remain
in full force and effect.   Please
acknowledge your agreement with these amendments by signing in the space
provided below.

 

Sincerely,

 

 

	
   /s/
  Frederick J. Florjancic, Jr.

  	
   

  
	
  Frederick
  J. Florjancic, Jr.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Acknowledged
  and Agreed:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   /s/
  Steven H. Grimshaw

  	
   

  
	
  Steve
  Grimshaw

  	
   

  

 

SAFETY-KLEEN HOLDCO, INC.

5400 LEGACY DRIVE, CII B3         
PLANO, TX 75024         
972-265-2000Exhibit 10.11

 

EMPLOYMENT AGREEMENT

 

AGREEMENT  by and between
Safety-Kleen Systems, Inc., a Wisconsin corporation (the “Company”), Safety-Kleen HoldCo., Inc. (“SK HoldCo”)
and David M. Sprinkle (the “Executive”), dated as of the 20th day of May, 2006 (the “Effective
Date”).

 

WHEREAS, the Company has determined that it is in
the best interests of the Company to employ the Executive as the Executive Vice
President of the Company and SK HoldCo, and
Executive desires to serve the Company in that capacity pursuant to the terms
set forth herein.

 

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

 

1.             Employment
Period.  The Company
shall employ the Executive, and the Executive shall serve the Company, on the
terms and conditions set forth in this Agreement, during the employment period
which shall begin on the Effective Date and continue for two years unless
earlier terminated pursuant to the terms of this Agreement (the “Employment
Period”). This Agreement may be renewed, and the Employment Period thereby
extended if not previously terminated pursuant to the terms hereof, by the
Company upon the same terms and conditions as contained herein, upon at least
sixty (60) days written notice to Executive prior to the end of the expiring
term of the Employment Period.

 

2.             Position
and Duties.  During the Employment
Period, the Executive shall serve as Executive Vice President of the Company
and SK  HoldCo and in substantially similar positions in the subsidiaries
and affiliates of the Company, with the duties, functions, responsibilities and
authority customarily associated with such positions. During the Employment
Period, the Executive will devote substantially all of his attention and time
to the business and affairs of the Company, excluding any periods of vacation
and sick leave to which Executive is entitled, and will not engage in any other
business activities that will unreasonably interfere with the Executive’s
employment pursuant to this Agreement. 
During the Employment Period, Executive will be based out of the Company’s
offices in Plano, Texas (or such other location as the Company and Executive
may agree from time to time), and the Executive’s services shall be performed
at such locations where the Company conducts business throughout North America
as the needs and exigencies of the business of the Company from time to time
reasonably require. However, Executive will not be required by the Company to
relocate from his then current residence as a condition of employment.

 

3.             Compensation.

 

(a)           Salary.  From the Effective Date through the end of the Employment
Period, the Executive shall receive an annual base salary (the “Salary”) of $336,375
payable in accordance with the Company’s normal payroll practices for
executives. Executive will receive an annual performance review in accordance
with the Company’s annual performance review and merit increase process, and
may receive a corresponding Salary increase at such time. Any new salary due to
any such increase will thereafter be deemed the “Salary” for purposes of this Agreement.

 

(b)           Annual
Bonus.  Executive
will have an annual target Merit Incentive Plan bonus (the “MIP Bonus”) percentage
of 100% of his Salary (the “Bonus”). The Bonus will be subject to

 

 

the terms and conditions of
the MIP Bonus program approved by the SK HoldCo Board of Directors each year.

 

(c)           Other
Benefits. 
During the Employment Period: (i) the Executive shall be entitled
to participate in the Company’s 401-k Plan, applicable fringe benefit programs
and other benefit plans, policies and programs of the Company applicable to
Executive as may be amended by the Company from time to time; and (ii) the
Executive shall be entitled to four weeks of vacation annually, effective and
vested on January 1 of each year during the Employment Period.

 

(d)           Programs,
Procedures and Policies.  Executive will comply with and be bound by
the Company’s applicable current and future programs, procedures, plans and
policies, as may be amended by the Company from time to time, except to the
extent such programs, procedures, plans or policies are contrary to the terms
and conditions of this Agreement.

 

4.             Termination of Employment.

 

(a)           Death or
Disability. In the event of the Executive’s
death during the Employment Period, the Executive’s employment with the Company
shall terminate automatically. In addition, the Company shall have the right to
terminate the Executive’s employment because of the Executive’s Disability (as
defined in the Company’s Long Term Disability Benefit Plan) during the
Employment Period. A termination of the Executive’s employment by the Company
for Disability shall be communicated to the Executive by written notice, and
shall be effective on the 5th day after receipt of such notice by the Executive
(the “Disability Effective Date”), unless the Executive returns to full-time
performance of the Executive’s duties before the Disability Effective Date.

 

(b)           By the
Company.  In addition
to termination for death or Disability, the Company may terminate the Executive’s
employment during the Employment Period with Cause, after receipt of written
notice to Executive and a reasonable opportunity to cure, or without
Cause.  For purposes of this Agreement, “Cause”
means:

 

(i)            the willful and continued failure by Executive substantially to perform his
duties with the Company (other than any such failure resulting from Disability
or other causes beyond Executive’s reasonable control); or

 

(ii)           the willful engaging by Executive in conduct that is demonstrably and
materially injurious to the Company, monetarily or otherwise; or

 

(iii)          the material failure of Executive to comply with the terms and conditions
of this Agreement. 

 

(c)           Voluntarily
by the Executive. 
The Executive may voluntarily terminate his employment at any time
during the Employment Period by giving not less than sixty (60) days prior
written notice thereof to the Company.

 

(d)           Date of
Termination. 
The “Date of Termination” means the last day of the Employment Period if
not otherwise terminated early pursuant to any provision of this Agreement (“End
of the Term”), the date of the Executive’s death, the Disability Effective
Date, 

 

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the date on which the
termination of the Executive’s employment by the Company with Cause or without
Cause is effective, or the date on which the voluntary termination of the
Executive’s employment by Executive is effective, as the case may be.

 

5.             Obligations of the Company on Termination.

 

(a)           If the Executive’s employment is terminated (i) due to the Company
failing to renew this Agreement in accordance with its terms at least sixty
(60) days prior to the End of the Term; (ii) by the Company for any reason
other than the Executive’s death, Disability or Cause, or (iii) due to
Executive resigning because the Company materially fails to comply with the
terms and conditions of this Agreement after notice from Executive and a
reasonable opportunity to cure such matter, the Company shall, upon execution
by Executive of a general release, pay to the
Executive within 10 days after the Date of Termination, a lump-sum cash amount
equal to the sum of any portion of the Salary and any other compensation earned
for the period up to the Date of Termination that has not yet been paid, the
cash equivalent of any accrued but unused vacation, and one year’s Salary.  Further, (x) all unvested Options
granted to Executive by SK HoldCo that are scheduled to vest in the year after
the Date of Termination, will vest prorate for that year, (y)  the
MIP Bonus payment for the year in which the Date of Termination occurs, will be
payable to Executive when and as paid to other Company employees, and will be
calculated as if Executive remained employed with the Company the entire MIP
year (i.e., not prorated for length of employment in that MIP year), and (z) provided
Executive elects continued health insurance coverage through COBRA, the Company
will pay the monthly COBRA contributions for Executive and his family for  health insurance coverage, as may be amended from time to
time, (less an amount equal to the premium contribution paid by active Company
employees) during such one year period; provided, however, that if at any time
Executive becomes eligible for health insurance through subsequent employment
or otherwise, the Company’s health benefit obligations shall immediately cease,
and the Company shall have no further obligation to make COBRA contributions on
Executive’s behalf.

 

(b)           Cause; Voluntary Termination. If the
Executive’s employment is terminated (i) due to the Executive’s death or
Disability, (ii) for Cause by the Company, or (iii) by the Executive
voluntarily during the Employment Period, the Company shall pay the Executive,
within 10 days after the Date of Termination, a lump-sum cash amount equal to
the sum of any portion of the Salary and any other compensation earned for the
period up to the Date of Termination that has not yet been paid, plus the cash
equivalent of any accrued but unused vacation.

 

(c)           In
addition to the payments and benefits to which the Executive or the Executive’s
estate may be entitled under Sections 5(a) and (b) above and Section 5(d) below,
the Executive shall be entitled to receive any vested or other benefits to
which he may be entitled pursuant to the terms and conditions of the Company’s
401-k Plan and any Company Life, Disability or Health Insurance Plan in which
he may participate, and any other amounts due under this Agreement.

 

(d)           Change in Control.   If
Executive’s employment ends due to any of the items listed in Section 5(a) after
or in anticipation of a Change in Control (as defined below), instead of the
amounts in Section 5(a), the Company shall, upon execution by Executive of
the Company’s 

 

3

 

settlement agreement and
general release, pay to the Executive within 10 days after the Date of
Termination, a lump-sum cash amount equal to the sum of any portion of the
Salary and any other compensation earned for the period up to the Date of
Termination that has not yet been paid, the cash equivalent of any accrued but
unused vacation, and two (2) year’s Salary. Further, (a) all unvested
Options granted to Executive by SK HoldCo will fully vest upon such Date of
Termination, (b) the MIP Bonus payment for the year in which the Date of
Termination occurs, will be payable to Executive on a prorata basis when and as
paid to other Company employees, and (c) provided Executive elects
continued health insurance coverage through COBRA, the Company will pay
Executive’s monthly COBRA contributions for health insurance coverage, as may
be amended from time to time, (less an amount equal to the premium contribution
paid by active Company employees) during such two year period; provided,
however, that if at any time Executive becomes eligible for health insurance
through subsequent employment or otherwise, the Company’s health benefit
obligations shall immediately cease, and the Company shall have no further
obligation to make COBRA contributions on Executive’s behalf. A “Change of
Control” for purposes of this Agreement means the sale, monetization or other
disposition of all or substantially all (greater than 50%) of the assets of the
Company or SK HoldCo, or if a “person” or “group” (within the meaning of
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
in effect from time to time) becomes the beneficial owner (as defined in Rule 13d-3
under the Securities Exchange Act of 1934, as in effect from time to time),
directly or indirectly, of more than 66 2/3 % of the common stock of SK HoldCo
having the right to vote for the election of members of the SK HoldCo Board of
Directors (but shall not include any initial or secondary public offering of SK
HoldCo stock under the 1933 Securities Act, as in effect from time to time). Notwithstanding
the foregoing, if the definition of “Change of Control” in the Company’s Equity
Plan (as amended from time to time) is more favorable to the Executive, then
such definition shall be controlling for purposes of this Agreement.  If Executive’s employment ends due to any of
the items listed in Section 5(a) within six (6) months prior to
a Change of Control, it will be deemed to be “in anticipation of a Change of
Control” for purposes of this paragraph.

 

6.             Confidentiality
and Noncompetition. Executive agrees to execute,
comply with and be bound by the Non-disclosure, Non-solicitation and
Non-competition Agreement attached hereto as Exhibit “A” and incorporated
herein by reference. Executive will treat the terms of this Agreement as
strictly confidential, and will not disclose the same to any Company employees other than those involved in the
preparation and negotiation of this Agreement.

 

7.             Successors.  (a) This Agreement is personal to the Executive and,
without the prior written consent of the Company, shall not be assignable by
the Executive otherwise than by will or the laws of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by the
Executive’s legal representatives.

 

(b)  This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns. The Company shall
not assign this Agreement without the prior written consent of the Executive,
which consent shall not be unreasonably withheld.

 

8.             Miscellaneous. (a) The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified 

 

4

 

except by
a written agreement executed by the parties hereto or their respective
successors and legal representatives.

 

(b)           All notices and other communications under this Agreement shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:

 

	
  If to the Executive:

  	
   

  	
  David M. Sprinkle

  
	
   

  	
   

  	
  [Address on file with the Company]

  
	
   

  	
   

  	
   

  
	
  If to the Company or SK HoldCo:

  	
   

  	
  Safety-Kleen Systems, Inc.

  
	
   

  	
   

  	
  5400 Legacy Drive, 

  
	
   

  	
   

  	
  Cluster II, Building 3 

  
	
   

  	
   

  	
  Plano, Texas 75024

  
	
   

  	
   

  	
  Attention: General Counsel

  

 

or to such
other address as either party furnishes to the other in writing in accordance
with this paragraph (b) of Section 8. Notices and communications
shall be effective when actually received by the addressee.

 

(c)           The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement. If any provision of this Agreement shall be held invalid or
unenforceable in part, the remaining portion of such provision, together with all
other provisions of this Agreement, shall remain valid and enforceable and
continue in full force and effect to the fullest extent consistent with law.

 

(d)           Notwithstanding any other provision of this Agreement, the Company may
withhold from amounts payable under this Agreement all federal, state, local
and foreign taxes that are required to be withheld by applicable laws or
regulations.

 

(e)           The Executive’s or the Company’s failure to insist upon strict compliance
with any provision of, or to assert any right under, this Agreement shall not
be deemed to be a waiver of such provision or right or of any other provision
of or right under this Agreement.

 

(f)            The Executive and the Company acknowledge that this Agreement supersedes
any other agreement, whether written or oral, between them concerning the
subject matter hereof, including any prior employment agreement, severance
agreement or plan, and change of control agreement or plan.

 

(g)           This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Delaware without reference to principles of conflict of
laws.

 

(h)           This Agreement may be executed in several counterparts, each of which shall
be deemed an original and said counterparts shall constitute but one and the
same instrument.

 

5

 

IN WITNESS WHEREOF, the Executive has hereunto set the
Executive’s hand, and the Company and SK HoldCo have caused this Agreement
to be executed in their names on their behalf, all as of the day and year first
above written.

 

 

	
   

  	
   /s/ David M. Sprinkle

  
	
   

  	
  David M. Sprinkle,
  Executive

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SAFETY-KLEEN SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Frederick
  J. Florjancic, Jr.

  
	
   

  	
   

  	
  Frederick J.
  Florjancic, Jr.

  
	
   

  	
   

  	
  Chief Executive Officer and President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SAFETY-KLEEN HOLDCO., INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Frederick J. Florjancic, Jr.

  
	
   

  	
   

  	
  Frederick J.
  Florjancic, Jr.

  
	
   

  	
   

  	
  Chief Executive Officer and President

  

 

6

 

	
  

  	
   

  	
  Frederick J. Florjancic, Jr. 

  President and Chief   

  Executive Officer   

  
	
   

  	
   

  
	
   

  	
  November 30, 2006

  

 

Dave Sprinkle

Executive Vice President

Safety-Kleen Systems, Inc.

5400 Legacy Drive

Plano, TX 75024

 

Re:                               Amendment to Employment
Agreement dated May 20, 2006 (the “Employment Agreement”)

 

Dear
Dave,

 

The
purpose of this letter is to confirm the decision of the Human Resource and
Compensation Committee to amend certain provisions of the Employment Agreement
as follows:

 

A.                                   The “Employment
Period” under the Employment Agreement is extended until December 31,
2009.

 

B.                                     Section 3(b) of
the Employment Agreement is amended in its entirety as follows effective as of January 1,
2007 (for clarification, this amendment does not modify the Executive’s annual
bonus applicable to the 2006 MIP Plan year):

 

	
  3.

  	
  Compensation.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ...

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
   

  	
  Annual
  Bonus. 
  Executive will have an annual bonus as a percentage of Salary (the
  “Bonus”) as follows:

  
						

 

	
  Plan

  	
   

  	
  Plan +

  	
   

  	
  Plan ++

  
	
        67%      

  	
   

  	
        133%      

  	
   

  	
        200%      

  

 

	
  The
  Bonus will be subject to the terms and conditions of the annual bonus program
  approved by the SK Holdco Board of Directors each year.

  

 

SAFETY-KLEEN HOLDCO, INC.

5400 LEGACY DRIVE, CII B3         
PLANO, TX 75024         
972-265-2000

 

 

	
  

  	
   

  	
  Frederick J. Florjancic, Jr. 

  President and Chief   

  Executive Officer   

  

 

All
other terms and conditions of the Employment Agreement as amended shall remain
in full force and effect.   Please
acknowledge your agreement with these amendments by signing in the space
provided below.

 

Sincerely,

 

 

	
   /s/
  Frederick J. Florjancic, Jr.

  	
   

  
	
  Frederick
  J. Florjancic, Jr.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Acknowledged
  and Agreed:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   /s/ David
  M. Sprinkle

  	
   

  
	
  Dave
  Sprinkle

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