Document:

exv10w07

 

EXHIBIT 10.07

ALLIED WASTE INDUSTRIES, INC.

2005 NON-EMPLOYEE DIRECTOR EQUITY COMPENSATION PLAN

[Effective May 20, 2005]

1. Purpose of the Plan

     This Allied Waste Industries, Inc. 2005 Non-Employee Director Equity Compensation Plan was
adopted, subject to stockholder approval, for the benefit of Non-Employee Directors of Allied Waste
Industries, Inc. The Plan is intended to advance the interests of the Company by providing the
Non-Employee Directors with additional incentive to serve the Company by increasing their
proprietary interest in the success of the Company.

2. Definitions

     As used in the Plan, the following definitions apply to the terms indicated below.

     (a) “Additional Restricted Stock Units” has the meaning set forth in Section 6(d).

     (b) “Affiliate” of any person means an individual or entity that directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under common control with
such person.

     (c) “Annual Grant” means the annual grant of an Award to an Eligible Director pursuant to
Section 5(b).

     (d) “Award” means a share of Restricted Stock, Restricted Stock Unit, or Option granted under
this Plan.

     (e) “Board” or “Board of Directors” means the Board of Directors of the Company.

     (f) “Cash Fee Award” means cash fees paid to eligible Directors from time to time for their
continued service on the Board and/or for attendance at meetings of the Board or of committees of
the Board.

     (g) “Committee” means a committee duly appointed by the Board, which Committee shall consist
of not less than two members of the Board.

     (h) “Common Stock” means the Company’s common stock, par value $.01 per share.

     (i) “Company” means Allied Waste Industries, Inc., a Delaware corporation.

     (j) “Deferred Compensation Plan” means any nonqualified deferred compensation plan of the
Company that is currently in effect or subsequently adopted by the Company.

     (k) “Designee Director” means a person designated by a Designating Person to serve as a
Non-Employee Director pursuant to the Company’s Certificate of Incorporation or Bylaws, or an
agreement or other arrangement between the Company and the Designating Person.

     (l) “Designating Person” with respect to a Designee Director means an individual or entity
that has the right to designate such Designee Director to serve as a Director of the Company.

     (m) “Effective Date” means the date on which the Company’s stockholders approve this Plan.

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     (n) “Eligible Director” means, for purposes of an Award, a person who is elected, appointed,
or reelected as a Non-Employee Director on or after the Effective Date.

     (o) “Fair Market Value” of a share of Common Stock on any date is (i) the closing sales price
of a share of Common Stock on that date (or if that date is not a business day, on the immediately
preceding business day) as reported on the principal securities exchange on which shares of Common
Stock are then listed or admitted to trading; (ii) if not so reported, the average of the closing
bid and asked prices for a share of Common Stock on that date (or if that date is not a business
day, on the immediately preceding business day as quoted on the Nasdaq Stock Market, Inc.
(“Nasdaq”) or (iii) if not quoted on Nasdaq, the average of the closing bid and asked prices for a
share of Common Stock as quoted by the National Quotation Bureau’s “Pink Sheets” or the National
Association of Securities Dealers’ OTC Bulletin Board System on that date (or if that date is not a
business day, on the immediately preceding business day). If the price of a share of Common Stock
is not so reported, the Fair Market Value of a share of Common Stock shall be determined by the
Plan Administrator in good faith.

     (p) “Initial Grant” means the initial grant of an Award to an Eligible Director pursuant to
Section 5(a).

     (q) “New Director”, for purposes of an Award, means a person who (i) is first elected or
appointed as a Non-Employee Director on or after the Effective Date, or (ii) first becomes a
Non-Employee Director on or after the Effective Date.

     (r) “Non-Employee Director” or “Director” means a director of the Company who, at the time of
his or her service, is not an employee of the Company or any Subsidiary.

     (s) “Option” means an option to purchase shares of Common Stock of the Company granted
pursuant to Section 5(d).

     (t) “Plan” means this Allied Waste Industries, Inc. 2005 Non-Employee Director Equity
Compensation Plan, which was previously known as the Allied Waste Industries, Inc. 1994 Amended and
Restated Non-Employee Director Stock Option Plan.

     (u) “Plan Administrator” means the Board or the Committee, as the case may be.

     (v) “Restricted Stock” means shares of Common Stock that are granted pursuant to the terms of
Section 5 and that are subject to the restrictions set forth in Section 6 for so
long as such restrictions continue to apply to such shares.

     (w) “Restricted Stock Unit” or “RSU” means the Company’s unfunded promise to pay one share of
Common Stock or its cash equivalent that is granted pursuant to the terms of Section 5 and
that is subject to the restrictions set forth in Section 6 for so long as such restrictions
continue to apply to such unit.

     (x) “Securities Act” means the Securities Act of 1933, as amended.

     (y) “Subsidiary” or “Subsidiaries” mean any and all corporations or other entities in which,
at the pertinent time, the Company owns, directly or indirectly, stock or other equity interests
vested with more than 50% of the total combined voting power of all classes of stock of such
corporations within the meaning of Section 424(f) of the Internal Revenue Code of 1986, as amended.

3. Administration of the Plan

     The Plan shall be administered by the Plan Administrator. If a Committee is the Plan
Administrator, a majority of the members of the Committee shall constitute a quorum for the
transaction of business and the vote of a majority of those members present at any meeting shall
decide any question brought before that meeting. The Plan Administrator shall have full authority
to administer the Plan, including authority to interpret

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and construe any provision of the Plan and the terms of any Award granted under it and to
adopt such rules and regulations for administering the Plan as it may deem necessary. Decisions of
the Plan Administrator shall be final and binding on all parties. Notwithstanding the above, the
selection of Non-Employee Directors to whom Awards are to be granted, the number of shares of
Restricted Stock granted or the number of shares subject to any RSU or Option, the exercise price
of any Option, the ten-year maximum term of any Option, and the vesting period for shares of any
Awards shall be as provided in this Plan and the Plan Administrator shall have no discretion as to
such matters.

4. Stock Reserved for the Plan

     A maximum of 2,750,000 shares of Common Stock may at any time be (a) granted as Restricted
Stock under the Plan, (b) subject to outstanding RSUs or Options granted under the Plan, or (c)
issued to Eligible Directors as the result of conversions of Cash Fee Awards; provided, that the
class and aggregate number of shares granted hereunder shall be subject to adjustment in accordance
with the provisions of Section 12 of this Plan. The Company shall reserve for issuance
pursuant to this Plan such number of shares of Common Stock as may from time to time be granted or
subject to Awards hereunder. If any shares of Restricted Stock are forfeited or cancelled for any
reason, such shares shall again be available for grant under the Plan. If any RSUs are forfeited or
cancelled for any reason, or if any Options expire or are canceled prior to their exercise in full,
the shares of Common Stock subject to such RSUs or Options shall again be available for grant under
the Plan. If there are not sufficient shares under the Plan to make an Award on the date the Award
is to be made, the Award will not be made.

5. Awards

     (a) Initial Grant to New Directors. Beginning on the Effective Date of this Plan and
for so long as this Plan is in effect and shares of Common Stock are available for the grant of
Awards, each New Director shall be granted shares of Restricted Stock (or, in the discretion of the
Plan Administrator, Restricted Stock Units or Options) having a Fair Market Value of $150,000,
which shares shall be awarded on the later of (i) the date of the New Director’s initial election
to the Board or (ii) the date upon which the New Director first becomes eligible to participate in
this Plan. Restricted Stock granted under this Section 5(a) shall be subject to the
provisions of Section 6.

     (b) Annual Grant. Beginning on the Effective Date and for so long as this Plan is in
effect and shares of Common Stock are available for the grant of Awards, each Eligible Director
shall, on each date on which he or she is elected or reelected to the Board, be granted shares of
Restricted Stock (or, in the discretion of the Plan Administrator, Restricted Stock Units or
Options) having a Fair Market Value of $55,000, which shares shall be awarded on the date of
reelection. Restricted Stock granted under this Section 5(b) shall be subject to the
provisions of Section 6.

     (c) Determination of Number of Shares. The number of shares of Restricted Stock
subject to each Award granted pursuant to Section 5(a) or 5(b) shall be determined
by dividing the dollar amount set forth in Section 5(a) or 5(b), as the case may
be, by the Fair Market Value of one share of Common Stock on the date of the Award; provided,
however, that the number of shares of Restricted Stock shall be rounded downward such that no
fractional share shall be issued.

     (d) Restricted Stock Units or Options in Lieu of Shares of Restricted Stock. The Plan
Administrator, in its discretion, may determine that one or more Initial Grants or Annual Grants
under this Plan shall be made in the form of RSUs or Options. If the Plan Administrator determines
that RSUs are to be awarded instead of shares of Restricted Stock, then (i) the number of shares of
Common Stock subject to each award of RSUs shall be the number of shares of Restricted Stock that
otherwise would have been awarded, (ii)the RSUs will be subject to the terms and conditions of
Section 6, and (iii) the agreement evidencing the RSUs shall specify whether payment, upon
vesting, will be made in the form of Common Stock (whereby the Director will receive one share of
Common Stock for each Restricted Stock Unit) or in cash (whereby the Director will receive a lump
sum cash payment in an amount equal to the Fair Market Value of one share of Common Stock at the
time of vesting times the number of vested RSUs). If the Plan Administrator determines that
Options are to be awarded instead of shares of Restricted Stock, then (A) the

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number of shares of Common Stock subject to each Option shall be three times the number of
shares of Restricted Stock that otherwise would have been awarded, and (B) the Options shall be
subject to the terms and conditions of Section 7.

     (e) Vesting. An Award made under Section 5(a) above shall be subject to the
following vesting schedule: 0% vested until the last day of the Director’s first one-year term
ending after the date of grant; 1/3 vested on the last day of the Director’s first one-year term
ending after the date of grant; an additional 1/3 vested on the last day of the Director’s second
one-year term ending after the date of grant; and an additional 1/3 vested on the last day of the
Director’s third one-year term ending after the date of grant. An Award made under Section
5(b) above shall be subject to the following vesting schedule: 0% vested until the last day of
the Director’s first one-year term ending after the date of grant, and 100% vested on the last day
of the Director’s first one-year term ending after the date of grant. Upon vesting, shares of
Restricted Stock and/or RSUs shall no longer be subject to any restrictions set forth in
Section 6, and Options may be exercised pursuant to the terms and conditions set forth in
Section 7. Any portion of an Award granted under Section 5(a) or 5(b) that
remains unvested as of the date a Director ceases to be a Director for any reason shall be
forfeited. Notwithstanding any contrary provision of this Section 5(e), an Award shall be
fully vested in the event of the Director’s death or as otherwise provided in the agreement
evidencing the Director’s Award.

     (f) Adjustments to Amount of Initial Grants and Annual Grants. Notwithstanding the
foregoing, the Board may, from time to time and in its sole discretion, (i) adjust (upward or
downward) the nominal dollar value of Initial Grants under Section 5(a); provided, however,
that the Board may not increase the nominal dollar value of Initial Grants to more than $200,000 in
the aggregate during the term of the Plan; and (b) adjust (upward or downward) the nominal dollar
value of Annual Grants under Section 5(b); provided, however, that the Board may not
increase the nominal value of Annual Grants to more than $80,000 in the aggregate during the term
of the Plan.

     (g) Awards to Designee Directors. A Designee Director may provide written notice to
the Plan Administrator to instruct the Plan Administrator to issue any Awards that would be
issuable to such Designee Director under the Plan to the Designee Director’s Designating Person or
its Affiliates. Upon receipt of such notice, the Plan Administrator shall cause all Awards that
would otherwise be issuable to the Designee Director under the Plan to be issued to the Designee
Director’s Designating Person or its Affiliates, according to the instructions set forth in such
notice.

6. Restricted Stock and Restricted Stock Units

     (a) Issuance of Certificates for Restricted Stock. Reasonably promptly after the award
of shares of Restricted Stock under Section 5(a) or 5(b), the Company shall cause
to be issued a stock certificate, registered in the name of the Director to whom such shares were
granted, evidencing such shares; provided that the Company shall not cause such stock certificate
to be issued unless it has received a stock power duly endorsed in blank with respect to such
shares. Each such stock certificate shall bear the following legend:

The transferability of this certificate and the shares of stock represented hereby
are subject to the restrictions, terms, and conditions (including forfeiture and
restrictions against transfer) contained in the Allied Waste Industries, Inc. 2005
Non-Employee Director Equity Compensation Plan (the “Plan”) and an agreement entered
into between the registered owner of such shares and Allied Waste Industries, Inc.
A copy of the Plan and agreement is on file in the office of the Secretary of Allied
Waste Industries, Inc.

Such legend shall not be removed from the certificate evidencing such shares until such shares vest
pursuant to the terms of this Plan.

     Each certificate issued pursuant to the above paragraph, together with the stock powers
relating to the shares of Restricted Stock evidenced by such certificate, shall be held by the
Company. The Company shall issue to the Director a receipt evidencing the certificates that are
registered in the name of the Director and held by the Company.

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     Reasonably promptly after a share of Restricted Stock vests pursuant to the terms of
Section 5(e), the Company shall cause to be issued and delivered to the Director to whom
such shares were granted a certificate evidencing such shares, free of the legend set forth above.
Delivery of the certificate shall be effected for all purposes when the Company shall have
deposited such certificate in the United States mail, addressed to the Director.

     (b) Issuance of Certificates or Cash Payment Upon Vesting of RSUs. If shares of
Common Stock are to be issued upon vesting of RSUs, then reasonably promptly after the vesting of
such RSUs the Company shall cause to be issued a stock certificate, registered in the name of the
Director to whom such Units were granted, evidencing the shares, provided that such stock
certificate shall not be required to bear the legend set forth in Section 6(a). Delivery
of the certificate shall be effected for all purposes when the Company shall have deposited such
certificate in the United States mail, addressed to the Director. If, under Section 5(d),
a cash payment is to be made upon vesting of RSUs, then reasonably promptly after the vesting of
such RSUs the Company shall cause a lump sum payment to be made to the Director.

     (c) Restrictions on Transfer. Prior to vesting, a Director shall be entitled to
assign or transfer a share of Restricted Stock and all of the rights related thereto only to the
extent permitted by this Section 6(c). Any such assignment or transfer must not be for
value and shall be limited to an assignment or transfer to: (i) a child, stepchild, grandchild,
sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law
or sister-in-law, including adoptive relationships; (ii) any person sharing the Director’s
household (other than a tenant or employee); (iii) a trust in which the Director or any of the
persons described in clause (i) or (ii), above, hold more than 50% of the beneficial interest; or
(iv) a private foundation in which the Director or any of the persons described in clause (i) or
(ii), above, own more than 50% of the voting interests. A transfer to any entity in which more
than 50% of the voting interests are owned by the Director or any of the persons described in
clause (i) or (ii), above, in exchange for an interest in that entity shall not constitute a
transfer for value. Prior to vesting, a Director shall not be entitled to assign or transfer any
interest in any RSUs.

     (d) Voting and Dividend Rights. The holders of shares of Restricted Stock awarded
under this Plan shall have the same voting, dividend, and other rights as the Company’s other
stockholders (except that the transfer of such shares is limited in accordance with Section
6(c) prior to vesting); provided, however, that the Plan Administrator may require in the
agreement granting the shares of Restricted Stock that cash dividends be invested in additional
shares of Restricted Stock, subject to the same conditions and restrictions as the Award with
respect to which the dividends were paid. Holders of RSUs awarded under this Plan shall have no
voting, dividend, or other rights as stockholders of the Company unless and until such RSUs vest
and certificates for shares of Common Stock are issued pursuant to Section 6(b).
Notwithstanding the foregoing, the agreement evidencing RSUs may provide, in the event of a cash
dividend paid by the Company to holders of Common Stock generally, for the crediting of an
additional number of RSUs (“Additional Restricted Stock Units”) equal to the total number of whole
RSUs and any Additional Restricted Stock Units previously credited multiplied by the dollar amount
of the cash dividend paid per share of Common Stock by the Company, divided by the Fair Market
Value of a share of Common Stock. The agreement also may provide, in the event of a stock dividend
paid by the Company to holders of Common Stock generally, for the crediting of Additional
Restricted Stock Units equal to the total number of whole RSUs and Additional Restricted Stock
Units previously credited multiplied by the share dividend paid per share of Common Stock by the
Company. Any Additional Restricted Stock Units shall be subject to the same terms and restrictions
as the RSUs to which they relate.

     (e) Deferral of Issuance of Common Stock Upon Vesting of RSUs. A Director who is
eligible to participate in any Deferred Compensation Plan may elect to defer the dates on which
shares of Common Stock are to be issued pursuant to one or more RSUs. The Director’s election
shall be made pursuant to the terms of the Deferred Compensation Plan. When the vesting date
occurs, the RSU(s) subject to the election will be transferred into a deferred compensation account
established under the Deferred Compensation Plan and will be subject to the terms of the Deferred
Compensation Plan. Notwithstanding any election to defer the date(s) on which shares of Common
Stock are to be issued pursuant to one or more RSUs, in the event of a Director’s death prior to
the transfer to the Deferred Compensation Plan, all RSUs subject to such election (and otherwise
payable under the terms of this Plan) will be paid in full to the Director’s beneficiary within a

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reasonable time after notice to the Plan Administrator of the Director’s death or, if later,
on the date such payment would be made to the Director absent the deferral election.

7. Options

     (a) Exercise Price. The exercise price per share of Common Stock of each Option
granted to a Director pursuant to this Plan shall be the Fair Market Value of the Common Stock on
the date of grant.

     (b) Option Agreement. Each Option granted under this Plan shall be evidenced by an
agreement, in a form approved by the Plan Administrator, which shall be subject to the terms and
conditions of the Plan. Any agreement may contain such other terms, provisions, and conditions as
may be determined by the Plan Administrator, so long as such terms are not inconsistent with the
Plan.

     (c) Term and Exercise of Options. Each option agreement shall provide that the Option
shall expire ten (10) years from the date of the grant.

     (d) Procedure for Exercise of Options. An Option shall be exercised by delivering
notice to the Company’s principal office, to the attention of its Secretary, along with the
agreement evidencing the Option and payment for shares of Common Stock to be purchased upon the
exercise of the Option. The notice must specify the number of shares of Common Stock with respect
to which the Option is being exercised and must be signed by the Director (or his or her executor
or administrator). Payment shall be made either (i) in cash, by certified check, bank cashier’s
check or wire transfer, (ii) subject to the approval of the Plan Administrator, in shares of Common
Stock owned by the Director for a period of at least six months prior to the effective date on
which the Option is exercised and valued at their Fair Market Value on the effective date of such
exercise, (iii) subject to the approval of the Plan Administrator, in the form of a “cashless
exercise” (as described in Section 7(e), below), or (iv) subject to the approval of the
Plan Administrator, in any combination of the foregoing. Any payment in shares of Common Stock
shall be effected by the delivery of such shares to the Secretary of the Company, duly endorsed in
blank or accompanied by stock powers duly executed in blank, together with any other documents and
evidences as the Secretary of the Company shall require from time to time. The effective date on
which an Option is exercised shall be established by the Secretary and shall occur within an
administratively reasonable period of time (but no later than five business days) after the
Secretary receives the notice, agreement, and payment referred to above. Prior to the exercise
date, the Director may withdraw the notice, in which case the Option will not be exercised.

     (e) Cashless Exercise. The cashless exercise of an Option shall be pursuant to
procedures whereby the Director, by written notice, irrevocably directs (i) an immediate market
sale or margin loan with respect to all or a portion of the shares of Common Stock to which he or
she is entitled upon exercise pursuant to an extension of credit by a brokerage firm or other party
(provided that the brokerage firm or other party is not affiliated with the Company) of the
exercise price and any tax withholding obligations resulting from such exercise, (ii) the delivery
of the shares of Common Stock directly from the Company to such brokerage firm or other party, and
(iii) delivery to the Company from the brokerage firm or other party, from the proceeds of the sale
or the margin loan, of an amount sufficient to pay the exercise price and any tax withholding
obligations resulting from such exercise.

     (f) Termination of Options. Except as may be otherwise expressly provided in this
Plan or otherwise determined by the Plan Administrator, each Option, to the extent it shall not
have been exercised previously, shall terminate on the earliest of the following:

     (i) On the last day of the three-month period commencing on the date on which
the Director ceases to be a member of the Board for any reason, other than the death
of the Director, during which period the Director shall be entitled to exercise all
Options held by the Director on the date on which the Director ceased to be a member
of the Board that could have been exercised on such date;

     (ii) On the last day of the six-month period commencing on the Director’s death
while serving as a member of the Board, during which period the executor or
administrator of

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the Director’s estate or the person or persons to whom the Director’s Option
shall have been transferred by will or the laws of descent or distribution shall be
entitled to exercise all Options in respect of the number of shares that the
Director would have been entitled to purchase had the Director exercised such
Options on the date of his or her death; or

     (iii) Ten years after the date of grant of such Option.

     For purposes of this Section 7(f), “month” means 31 calendar days beginning with the
calendar day on which the relevant event occurs, and “year” means 365 calendar days beginning with
the calendar day on which the relevant event occurs.

     (g) Assignability of Options. Except as set forth in this Section 7(g),
during the lifetime of a Director each Option granted to him or her shall be exercisable only by
him or her or a broker-dealer acting on his or her behalf pursuant to Section 7(e). No
Option shall be assignable or transferable for value. Each Option may be assigned by a Director by
will or by the laws of descent and distribution, or pursuant to a Qualified Domestic Relations
Order. Additionally, each Option may be assigned to: (i) a child, stepchild, grandchild, sibling,
niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or
sister-in-law, including adoptive relationships, (ii) any person sharing the Director’s household
(other than a tenant or employee), (iii) a trust in which the Director or any of the persons
described in clause (i) or (ii), above, hold more than 50% of the beneficial interest, or (d) a
private foundation in which the Director or any of the persons described in clause (i) or (ii),
above, own more than 50% of the voting interests. A transfer to any entity in which more than 50%
of the voting interests are owned by the Director or any of the persons described in clause (i) or
(ii), above, in exchange for an interest in that entity shall not constitute a transfer for value
for purposes of this Section 7(g).

     (h) No Rights as a Stockholder. No Director shall have any rights as a stockholder
with respect to any shares covered by an Option until the date of the issuance of a stock
certificate or certificates representing such shares. Except as provided in Section 12 of
this Plan, no adjustment for dividends or otherwise shall be made if the record date is prior to
the date of issuance of the certificates representing shares of Common Stock purchased pursuant to
exercise of the Option.

8. Election Regarding Cash Fee Awards 

     (a) Election to Receive Equity in Lieu of Cash Fee Awards. Each Eligible Director may
elect, on or prior to the date of each annual meeting of the Company’s stockholders, in a writing
delivered to the Company’s principal executive offices, to have all or any portion of his or her
Cash Fee Awards paid to him or her in shares of Common Stock. Such election by a Director shall
remain valid until the date of the annual meeting of stockholders in the following year and, if the
Director does not make another written election with respect to his or her Cash Fee Awards at that
time, his or her Cash Fee Awards for the next year shall be paid in cash. Notwithstanding the
foregoing, if there are not sufficient shares of Common Stock available under the Plan to make
payment of the Cash Fee Awards in the form of Common Stock, the Cash Fee Awards will be paid in
cash.

     (b) Determination of Number of Shares Subject to Cash Fee Awards. If an Eligible
Director elects to have his or her Cash Fee Award paid in Common Stock, the number of shares shall
be determined by dividing the dollar amount of the Cash Fee Award to be paid in the form of shares
by the Fair Market Value of one share of Common Stock on the last day of the calendar month in
which the Cash Fee Award is earned; provided, however, that the number of shares of Common Stock
shall be rounded downward such that no fractional share shall be issued.

     (c) Vesting. Notwithstanding any contrary provision of this Plan, shares of Common
Stock paid to a Director in lieu of Cash Fee Awards will not be subject to vesting.

9. Extraordinary Corporate Transactions

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     If the Company effects a merger, consolidation, acquisition, separation, reorganization,
liquidation or similar transaction, the Company may substitute new Awards for the Awards then
outstanding under the Plan or a corporation other than the Company, including (without limitation)
a parent or subsidiary of the Company, may assume the Company’s duties as to Awards then
outstanding under the Plan. Notwithstanding the foregoing or the provisions of Section 11
of this Plan, in the event such corporation or parent or subsidiary of the Company does not
substitute new and substantially equivalent Awards for, or assume, the Awards then outstanding
under the Plan, all such outstanding Awards shall be cancelled immediately prior to the effective
date of such extraordinary corporation transaction and, in full consideration of such cancellation,
each Director to whom the Awards were granted shall be paid an amount in cash equal to the product
of (a) the number of shares of Restricted Stock held by the Director plus the number shares of
Common Stock issuable upon vesting of RSUs and exercise of Options held by the Director times (b)
the value, as determined by the Plan Administrator in its absolute discretion, of the property
(including cash) received by a holder of one share of Common Stock as a result of such event,
reduced by (c) the aggregate exercise price of all Options held by such Director.

     Except as otherwise expressly provided in this Plan, the issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class, for cash or
property, or for labor or services either on direct sale or on the exercise of rights or warrants
to subscribe therefor, or on conversion of shares or obligations of the Company convertible into
such shares or other securities, shall not affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares of Common Stock then subject to outstanding
Awards.

10. Investment Representations

     If the shares issuable upon the vesting of shares of Restricted Stock or RSUs or upon exercise
of an Option are not registered under the Securities Act, the Company may imprint on the
certificate representing such shares the following legend or any other legend that counsel for the
Company considers necessary or advisable to comply with the Securities Act:

THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT UPON SUCH REGISTRATION OR UPON RECEIPT BY
THE CORPORATION OF AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY TO THE
CORPORATION, THAT REGISTRATION IS NOT REQUIRED FOR SUCH SALE OR TRANSFER.

The Company may, but shall in no event be obligated to, register any securities under this Plan
pursuant to the Securities Act and, if any shares are so registered, the Company may remove any
legend on certificates representing such shares. The Company shall not be obligated to take any
other affirmative action to cause the vesting of shares of Restricted Stock, the vesting of RSUs,
or the exercise of an Option or the issuance of shares pursuant thereto to comply with any law or
regulation of any governmental authority.

11. Amendment or Termination

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     The Board may amend, modify, revise or terminate this Plan at any time and from time to time;
provided, however, that without the degree of stockholder approval required by the Company’s
charter or bylaws, applicable law, or the rules and regulations of any exchange or trading market
on which the Company’s securities are then traded, the Board may not: (a) materially increase the
benefits accruing to Eligible Directors under this Plan; (b) materially increase the number of
shares of Common Stock that may be issued under this Plan; or (c) materially modify the
requirements as to eligibility for participation in this Plan. All Awards granted under this Plan
shall be subject to the terms and provisions of this Plan and any amendment, modification or
revision of this Plan shall be deemed to amend, modify or revise all Awards outstanding under this
Plan at the time of such amendment, modification or revision, provided that no amendment,
modification, or revision of any Award that adversely affects the rights of the holder of such
award shall be effective with respect to such Award without the consent of the holder of such
Award. At the discretion of the Board, all outstanding Awards may be forfeited and terminated if
this Plan is terminated by action of the Board.

12. Changes in the Company’s Capital Structure

     The existence of outstanding Awards shall not affect in any way the right or power of the
Company or its stockholders to make or authorize the dissolution or liquidation of the Company, any
sale or transfer of all or any part of the Company’s assets or business, any reorganization or
other corporate act or proceeding, whether of a similar character or otherwise, any or all
adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure
or its business, any merger or consolidation of the Company, or any issuance of bonds, debentures,
preferred or prior preference stock senior to or affecting the Common Stock or the rights thereof.
Notwithstanding the foregoing, if the outstanding shares of Common Stock of the Company shall be
subdivided into a greater number of shares or the outstanding shares of Common Stock shall be
combined into a smaller number of shares thereof, then:

     (a) The number of shares of Restricted Stock or RSUs then outstanding under the Plan shall be
proportionately adjusted to equal the product obtained by multiplying such number of shares of
Common Stock by a fraction, the numerator of which is that number of outstanding shares of Common
Stock after giving effect to such combination or subdivision and the denominator of which is that
number of outstanding shares of Common Stock prior to such combination or subdivision.

     (b) The exercise price of any Option then outstanding under the Plan shall be proportionately
adjusted to equal the product obtained by multiplying such exercise price by a fraction, the
numerator of which is the number of outstanding shares of Common Stock prior to such combination or
subdivision and the denominator of which is that number of outstanding shares of Common Stock after
giving effect to such combination or subdivision; and

     (c) The number of shares of Common Stock issuable upon the exercise of any Option then
outstanding under the Plan shall be proportionately adjusted to equal the product obtained by
multiplying such number of shares of Common Stock by a fraction, the numerator of which is that
number of outstanding shares of Common Stock after giving effect to such combination or subdivision
and the denominator of which is that number of outstanding shares of Common Stock prior to such
combination or subdivision.

13. Compliance With Other Laws and Regulations

     The Plan, the grant of Awards, and the obligation of the Company to issue and deliver shares
of Common Stock upon vesting of shares of Restricted Stock or RSUs or upon exercise of Options
shall be subject to all applicable federal and state laws, rules, and regulations and to such
approvals by such governmental or regulatory agency or national securities exchange as may be
required. The Company shall not be required to issue any shares upon vesting of shares of
Restricted Stock or RSUs or upon exercise of any Option if the issuance of such shares shall
constitute a violation by the Director or the Company of any provisions of any law or regulation of
any governmental authority. Each Award granted under this Plan shall be subject to the requirement
that, if at any time the Plan Administrator shall determine that (a) the listing, registration or
qualification of the shares subject thereto on any securities exchange or trading market or under
any state or federal law of the United States or of any other country or governmental subdivision
thereof,

9

 

(b) the consent or approval of any governmental regulatory body, or (c) the making of
investment or other representations are necessary or desirable in connection with the issue or
purchase of shares subject thereto, no shares of Common Stock may be issued upon grant, vesting, or
exercise of any Award Option unless such listing, registration, qualification, consent, approval or
representation shall have been effected or obtained, free of any conditions not acceptable to the
Plan Administrator. Any determination in this connection by the Plan Administrator shall be final,
binding, and conclusive.

14. Limitation of Liability; Indemnification of Committee and Board of Directors

     No member of the Board or the Committee shall be liable for any act or omission of any other
member of the Board or the Committee or for any act or omission on his or her own part, including
(without limitation) the exercise of any power or discretion given to him or her under this Plan,
except those resulting from his or her own gross negligence or willful misconduct. The Company
shall, to the fullest extent permitted by law, indemnify, defend, and hold harmless any person who
at any time is a party or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding (whether civil, criminal, administrative or investigative) in any way
relating to or arising out of this Plan or any Awards granted hereunder by reason of the fact that
such person is or was at any time a director of the Company or a member of the Committee against
judgments, fines, penalties, settlements, and reasonable expenses (including attorneys’ fees)
actually incurred by such person in connection with such action, suit or proceeding. This right of
indemnification shall inure to the benefit of heirs, executors, and administrators of each such
person and is in addition to all other rights to which such person may be entitled by virtue of the
bylaws of the Company or as a matter of law, contract or otherwise.

15. Effective Date; Expiration of the Plan

     This Plan, which provides for grants of shares of Restricted Stock, RSUs, and Options, shall
become effective on the Effective Date. Options previously granted under the Allied Waste
Industries, Inc. 1994 Amended and Restated Non-Employee Director Stock Option Plan shall remain in
full force and effect under the terms of such Options and this Plan. No Awards shall be granted
pursuant to this Plan on or after May 20, 2015.

     This Plan is hereby executed this 20th day of May, 2005.

	 	 	 	 	 
	 	 	ALLIED WASTE INDUSTRIES, INC.,
	 	 	a Delaware corporation
	 
	 	 	 	 
	 

	 	By	 	 
	 

	 	 	 	 
	 

	 	 	 	Steven M. Helm, Executive Vice President,
	 

	 	 	 	         General Counsel and Corporate Secretary

10exv10w08

 

EXHIBIT 10.08

AMENDMENT TO

NON-QUALIFIED STOCK OPTION AGREEMENTS

     THIS AMENDMENT, made and entered into on May 23, 2005, by ALLIED WASTE INDUSTRIES, INC.
(“Company”) and WARREN B. RUDMAN (“Optionee”).

R E C I T A L S:

     1. Optionee has been previously granted options to purchase an aggregate of 95,000 shares of
the Company’s common stock (“Options”), under the terms of the Allied Waste Industries, Inc. 1994
Amended and Restated Non-Employee Directors Stock Option Plan (“Plan”);

     2. Optionee is fully vested in the Options, and none of the Options have been exercised;

     3. The Company has agreed to extend the exercise periods for certain of the Options; and

     4. The Company deems it appropriate to amend the Optionee’s Non-Qualified Stock Option
Agreements (“Agreements”), to extend the relevant exercise periods.

     THEREFORE, the Company and Optionee hereby adopt this Amendment as follows:

     1. Notwithstanding anything to the contrary in the Agreements, the exercise periods for the
Options listed on Schedule A, attached to this Amendment, are extended to the earlier of: (a) three
years from the date Optionee’s last date of service on the Company’s Board of Directors, i.e., May
20, 2008, or (b) ten years from the Options’ Dates of Grant.

     2. The Effective Date of this Amendment shall be May 23, 2005.

     3. Except as amended, all of the terms and conditions of the Agreements shall remain in full
force and effect.

 

 

	 	 	 	 	 
	 	 	ALLIED WASTE INDUSTRIES, INC.
	 
	 	 	 	 
	 

	 	By	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Title	 
	 

	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	Warren B. Rudman

 

 

SCHEDULE A

	 	 	 	 	 
	 	 	 	 	Original
	Date of	 	Number of	 	Expiration
	Grant	 	Options	 	Date
	05/21/04
	 	10,000	 	05/21/14
	05/21/03
	 	10,000	 	05/21/13
	05/29/02
	 	10,000	 	05/29/12
	05/23/01
	 	10,000	 	05/23/11
	05/03/00
	 	10,000	 	05/03/10
	06/29/99
	 	10,000	 	06/29/09
	05/28/98
	 	10,000	 	05/28/08
	07/02/97
	 	25,000	 	07/02/07

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