<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
</TABLE>
REPUBLIC SERVICES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
Republic Services, Inc. (LOGO)
April 3, 2000
Dear Stockholder:
We invite you to attend the 2000 Annual Meeting of Stockholders of Republic
Services, Inc., which we will hold at 10:30 a.m. on Tuesday, May 9, 2000, at The
Broward Center for the Performing Arts, Amaturo Theater, 201 S.W. 5th Avenue,
Fort Lauderdale, Florida 33312. On the following pages we describe in the formal
notice and proxy statement the matters stockholders will consider at the annual
meeting.
In addition to the specific matters we will request stockholders to act
upon, we will report on our business and provide our stockholders an opportunity
to ask questions of general interest.
Whether or not you plan to attend in person, it is important that you have
your shares represented at the annual meeting. PLEASE DATE AND SIGN YOUR PROXY
CARD AND RETURN IT IN THE ENCLOSED ENVELOPE AS SOON AS POSSIBLE. The board of
directors recommends that stockholders vote FOR each of the proposals described
in the proxy statement which we will present at the annual meeting. Thank you.
Sincerely,
/s/ Wayne
H. Wayne Huizenga
Chairman of the Board
<PAGE> 3
Republic Services, Inc. (LOGO)
110 S.E. 6TH STREET
FORT LAUDERDALE, FLORIDA 33301
NOTICE OF THE 2000 ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Republic Services, Inc.:
We will hold the 2000 Annual Meeting of Stockholders of Republic Services,
Inc. at 10:30 a.m. on Tuesday, May 9, 2000, at The Broward Center for the
Performing Arts, Amaturo Theater, 201 S.W. 5th Avenue, Fort Lauderdale, Florida
33312, for the following purposes:
(1) To elect directors to a term of office expiring at the annual
meeting of stockholders in the year 2001 or until their respective
successors are duly elected and qualified;
(2) To consider and vote upon a proposal to approve and adopt our 1998
Stock Incentive Plan in order to qualify grants under the plan as
performance-based compensation;
(3) To ratify the appointment of Arthur Andersen LLP as our
independent public accountants for 2000; and
(4) To transact such other business as may properly come before the
annual meeting or any adjournment thereof.
Only stockholders of record at the close of business on March 14, 2000 are
entitled to notice of and to vote at the annual meeting or any adjournment of
the annual meeting.
We cordially invite you to attend the annual meeting in person. EVEN IF YOU
PLAN TO ATTEND IN PERSON, WE REQUEST THAT YOU DATE, SIGN AND RETURN THE ENCLOSED
PROXY AT YOUR EARLIEST CONVENIENCE. You may revoke your proxy at any time before
its use.
By Order of the Board of
Directors,
/s/ David A. Barclay
David A. Barclay
Senior Vice President,
General Counsel and Assistant
Secretary
Fort Lauderdale, Florida
April 3, 2000
PLEASE DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT
PROMPTLY IN THE ENVELOPE PROVIDED FOR THAT PURPOSE.
<PAGE> 4
REPUBLIC SERVICES, INC.
110 S.E. 6th Street
Fort Lauderdale, Florida 33301
PROXY STATEMENT
We furnish this proxy statement in connection with the solicitation of
proxies by our board of directors for use at our 2000 Annual Meeting of
Stockholders, or any postponement or adjournment of the meeting. We will hold
the annual meeting at 10:30 a.m. on Tuesday, May 9, 2000, at The Broward Center
for the Performing Arts, Amaturo Theater, 201 S.W. 5th Avenue, Fort Lauderdale,
Florida 33312.
We mailed this proxy statement, the notice of annual meeting, the proxy
card and our annual report to our stockholders on or about April 3, 2000.
RECORD DATE
Only stockholders of record at the close of business on March 14, 2000 may
vote at the annual meeting.
SHARES OUTSTANDING AND VOTING RIGHTS
The only voting stock of our company currently outstanding is our common
stock. As of the close of business on March 14, 2000, there were 175,481,842
shares of common stock outstanding. Each share of common stock issued and
outstanding is entitled to one vote on each of the matters properly presented at
the annual meeting.
PROXY PROCEDURE
Proxies properly executed and returned in a timely manner will be voted at
the annual meeting according to the voting instructions noted on the proxies.
Proxies without voting instructions will be voted to elect the individuals
nominated as directors in this proxy statement, for the proposals set forth in
the notice of annual meeting, and in the best judgment of the persons acting
under the proxies on other matters presented for a vote. Any stockholder giving
a proxy has the power, at any time before it is voted, to revoke it in person at
the annual meeting, by written notice to the secretary of our company at the
address above, or by delivery to the secretary of our company of a later-dated
proxy.
The inspectors of elections appointed for the meeting will tabulate the
votes cast by proxy or in person at the annual meeting. The inspectors will
count these votes in determining whether or not a quorum is present. A proxy
submitted by a stockholder may indicate that all or a portion of the shares
represented by that proxy are not being voted by that stockholder about a
particular matter. This could occur, for example, when a beneficial owner does
not permit its broker to vote shares on a particular matter in the absence of
instructions from the beneficial owner. In this circumstance, we will not
consider the non-voted shares present and entitled to vote on that particular
matter. However, we will count the non-voted shares in determining the presence
of a quorum. If you vote to abstain as to a particular matter or direct us to
withhold authority to vote for directors, we will consider your shares present
and entitled to vote on the matter.
VOTING REQUIREMENTS
Each director will be elected by the affirmative vote of a plurality of the
votes cast by the shares of common stock present at the annual meeting, in
person or by proxy, and entitled to vote on the election of directors. The
affirmative vote of the holders of a majority of our common stock present at the
annual meeting, in person or by proxy, and
<PAGE> 5
entitled to vote, is required to approve and adopt the 1998 Stock Incentive
Plan, to ratify the appointment of Arthur Andersen LLP as our independent public
accountants for 2000 and to approve any other matter duly brought to a vote at
the annual meeting. Shares which are not voted will have no effect on the other
matters brought to a vote at the annual meeting. Abstentions from voting on any
of the proposals brought to a vote at the annual meeting will have the effect of
votes against the particular proposal.
COSTS OF SOLICITATION
Our board of directors will solicit proxies by mail. Our directors,
officers and a small number of other employees of our company may also solicit
proxies personally or by mail, telephone, or otherwise. We will not compensate
these persons for their solicitation. We will request brokerage firms, banks,
fiduciaries, voting trustees or other nominees to forward the soliciting
material to each beneficial owner of stock held of record by them. We have hired
Corporate Investor Communications, Inc. to coordinate the solicitation of
proxies by and through these holders for a fee of approximately $8,500 plus
expenses. We will bear the entire cost of the solicitation.
BIOGRAPHICAL INFORMATION REGARDING DIRECTORS/NOMINEES
AND EXECUTIVE OFFICERS
DIRECTORS
We provide below biographical information for each person who is a nominee
for election as a director of our company at the annual meeting.
H. WAYNE HUIZENGA, age 62, was named Chairman of the board of directors in
May 1998. He also served as our Chief Executive Officer from May 1998 until
December 1998. Since August 1995, Mr. Huizenga has served as the Chairman of the
Board of AutoNation, Inc., the world's largest automotive retailer and our
former parent company. From August 1995 until October 1999, Mr. Huizenga served
as Chief Executive Officer or Co-Chief Executive Officer of AutoNation. Since
September 1996, Mr. Huizenga has served as the Chairman of the Board of Boca
Resorts, Inc., a leisure, recreation and entertainment company which owns and
operates several luxury resort hotels and other facilities, and the Florida
Panthers professional sports franchise. Since January 1995, Mr. Huizenga also
has served as the Chairman of the Board of Extended Stay America, Inc., an
operator of extended stay lodging facilities. From April 1987 through September
1994, Mr. Huizenga served as the Chairman of the Board and Chief Executive
Officer of Blockbuster Entertainment Corporation. During this time he helped
build Blockbuster from a 19-store chain into the world's largest video rental
company. In September 1994, Blockbuster merged into Viacom Inc., a diversified
entertainment and communications company. From September 1994 until October
1995, Mr. Huizenga served as the Vice Chairman of Viacom, and as the Chairman of
the Board of Blockbuster Entertainment Group, a division of Viacom. In 1971, Mr.
Huizenga co-founded Waste Management, Inc., which he helped build into the
world's largest integrated solid waste services company. At Waste Management,
Mr. Huizenga served in various capacities, including President, Chief Operating
Officer and a director from its inception until 1984. Mr. Huizenga owns the
Miami Dolphins professional sports franchise, as well as Pro Player Stadium in
South Florida, and is a director of theglobe.com, an operator of an internet
on-line community, and NationsRent, Inc., a national equipment rental company.
HARRIS W. HUDSON, age 57, was named Vice Chairman, Secretary and a director
in May 1998. Mr. Hudson has served as a director of AutoNation since August 1995
and as
2
<PAGE> 6
Vice Chairman of AutoNation since October 1996. He served as Chairman of
AutoNation's Solid Waste Group from October 1996 until July 1998. From August
1995 until October 1996, Mr. Hudson served as President of AutoNation. From May
1995 until August 1995, Mr. Hudson served as a consultant to AutoNation. From
1983 until August 1995, Mr. Hudson served as Chairman of the Board, Chief
Executive Officer and President of Hudson Management, a solid waste collection
company that he founded, which AutoNation acquired in August 1995. From 1964 to
1982, Mr. Hudson served as Vice President of Waste Management of Florida, Inc.,
a subsidiary of Waste Management, and its predecessor. Mr. Hudson also serves as
a director of Boca Resorts.
JAMES E. O'CONNOR, age 50, was named Chief Executive Officer and a director
in December 1998. From 1972 to 1978 and from 1982 to 1998, Mr. O'Connor served
in various positions with Waste Management, including Senior Vice President from
1997 to 1998, Area President of Waste Management of Florida, Inc. from 1992 to
1997, Senior Vice President of Waste Management -- North America from 1991 to
1992 and Vice President -- Southeastern Region from 1987 to 1991.
JOHN W. CROGHAN, age 69, was named a director in July 1998. Mr. Croghan is
President and General Partner of Lincoln Partners, a partnership of Lincoln
Capital Management Inc. He was a founder and, through 1997, the Chairman of
Lincoln Capital Management, an investment management firm. He is a director of
Morgan Stanley Dean Witter & Co.'s public closed-end funds, Lindsay
Manufacturing Co., and Schwarz Paper Company.
RAMON A. RODRIGUEZ, age 54, was named a director in March 1999. Mr.
Rodriguez has served as President of Madsen, Sapp, Mena, Rodriguez & Co., P.A.,
a certified public accounting firm, since 1971.
ALLAN C. SORENSEN, age 61, was named a director in November 1998. Mr.
Sorensen is also a director of Let's Talk Cellular & Wireless, Inc. and Westmark
Group Holdings, Inc. He is also a co-founder and Vice Chairman of the Board of
Interim Health Care, Inc., which Interim Services, Inc. spun-off in October
1997. Prior to that, Mr. Sorensen served as a director and in various capacities
including President, Chief Executive Officer and Chairman of Interim Services
from 1967 to 1997. He was a member of the board of directors of H&R Block, Inc.
from 1979 until September 1993 when Interim Services was spun off in an initial
public offering.
Mr. Hudson is married to Mr. Huizenga's sister. Otherwise, there is no
family relationship between any of our directors.
EXECUTIVE OFFICERS
We provide below biographical information for each of our executive
officers who is not a nominee for director.
JAMES H. COSMAN, age 57, was named President and Chief Operating Officer in
May 1998. Mr. Cosman served as President and Chief Operating Officer of
AutoNation's Solid Waste Group from January 1997 until July 1998. Mr. Cosman was
employed for over 24 years by Browning-Ferris Industries, Inc., a leading solid
waste company that is now part of Allied Waste Industries, Inc. During that time
he served in various management positions, including Regional Vice
President -- Northern Region from 1993 to 1996, Regional Vice President -- Mid
America Region from 1989 to 1993, Regional Vice President -- South Central
Region from 1979 to 1988 and District Manager from 1975 to 1979.
3
<PAGE> 7
DAVID A. BARCLAY, age 37, was named Senior Vice President, General Counsel
and Assistant Secretary in August 1998. Mr. Barclay served as Senior Vice
President and General Counsel of AutoNation's Solid Waste Group from March 1998
until July 1998. Prior to that, from January 1997 to February 1998, Mr. Barclay
was Vice President and Associate General Counsel of AutoNation. From June 1995
to January 1997, Mr. Barclay was Vice President, General Counsel and Secretary
of Discovery Zone, Inc. Discovery Zone filed a voluntary petition under the
federal bankruptcy laws in March 1996. Mr. Barclay served in various positions
with Blockbuster, including Senior Corporate Counsel from 1993 to 1995 and
Corporate Counsel from 1991 to 1993. Prior to joining Blockbuster, Mr. Barclay
was an attorney in private practice in Miami, Florida.
STEVEN R. GOLDBERG, age 49, was named Senior Vice President -- Corporate
Development in October 1998. From 1987 to 1998, Mr. Goldberg served in various
positions with Ryder System, Inc., including Vice President of Corporate
Development during 1998, Chief Financial Officer of Ryder Transportation
Services, a division of Ryder, from 1996 to 1998, and Vice President and
Treasurer from 1993 to 1996.
TOD C. HOLMES, age 51, was named Senior Vice President and Chief Financial
Officer in August 1998. Mr. Holmes served as our Vice President -- Finance from
June 1998 until August 1998 and as Vice President of Finance of AutoNation's
Solid Waste Group from January 1998 until July 1998. From 1987 to 1998, Mr.
Holmes served in various positions with Browning-Ferris, including Vice
President, Investor Relations from 1996 to 1998, Divisional Vice President,
Collection Operations from 1995 to 1996, Divisional Vice President and Regional
Controller -- Northern Region, from 1993 to 1995 and Divisional Vice President
and Assistant Corporate Controller from 1991 to 1993.
BOARD OF DIRECTORS
The board of directors develops our business strategy, establishes our
overall policies and standards, and reviews the performance of management in
executing our business strategy and implementing our policies and standards. We
keep directors informed of our operations at meetings and through reports and
analyses presented to the board of directors and committees of the board.
Significant communications between the directors and management also occur apart
from meetings of the board of directors and committees of the board.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The board of directors held 10 meetings and took eight actions by unanimous
written consent during 1999. Each incumbent director attended at least 75% of
the total number of meetings of the board of directors and the total number of
meetings held by all committees of the board on which he served.
The board of directors has established three committees: the executive
committee, the audit committee and the compensation committee.
The executive committee consists of Messrs. Huizenga, Hudson and O'Connor.
The executive committee has full authority to exercise all the powers of the
board of directors between meetings of the board of directors, except as
reserved by the board of directors.
The executive committee does not have the power to elect or remove
executive officers, approve a merger of our company, recommend a sale of
substantially all of our assets, recommend a dissolution of our company, amend
our certificate of incorporation or by-laws, declare dividends on our
outstanding securities, or, except as authorized by the board of directors,
issue any common stock or preferred stock. The board of directors has
4
<PAGE> 8
given the executive committee authority to approve acquisitions, borrowings,
guarantees or other transactions not involving more than $100 million in cash,
securities or other consideration. The executive committee is also charged with
corporate compliance matters. The executive committee took 34 actions by
unanimous written consent during 1999.
The audit committee consists of Messrs. Croghan, Rodriguez and Sorensen.
The audit committee has the power to oversee the retention, performance and
compensation of the independent public accountants for our company, and
establish and oversee such systems of internal accounting and auditing control
as it deems appropriate. The audit committee held three meetings during 1999.
The compensation committee consists of Messrs. Croghan, Rodriguez and
Sorensen. The compensation committee reviews our company's compensation
philosophy and programs, exercises authority with respect to the payment of
salaries and incentive compensation to directors and executive officers, and
administers our company's stock incentive plan. The compensation committee held
four meetings and took five actions by unanimous written consent during 1999.
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The following statement made by the compensation committee shall not be
deemed incorporated by reference into any filing under the Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as amended, and shall
not otherwise be deemed filed under either of these acts.
The compensation committee is responsible for reviewing and approving
executive compensation, including base salaries, bonuses, awards of stock
options and reimbursement of particular business related costs and expenses. The
compensation committee currently consists of Messrs. Croghan, Rodriguez and
Sorensen, each of whom is a non-employee director of our company.
In determining the compensation of our executive officers, the compensation
committee takes into account all factors which it considers relevant, including
business conditions in general and in our line of business during the year, our
performance during the year in light of the conditions, the market compensation
for executives of similar background and experience, and the performance of the
specific executive officer under consideration as well as the business area of
our company for which the executive officer is responsible. The structure of
each executive compensation package is weighted toward incentive forms of
compensation, including stock options, so that an executive's interests are
aligned with the interests of our stockholders. The compensation committee
believes that granting stock options provides an additional incentive to
executive officers to continue in the service of our company and gives them an
interest similar to stockholders in the success of our company. In 1999, our
compensation program for executive officers included grants of stock options as
additional compensation to base salaries and reimbursement of certain business
related costs and expenses. During 1999, our executive officers were eligible to
receive bonuses based upon achieving a predetermined level of earnings per share
on our common stock. Because this level was not achieved, no bonuses will be
paid to our executive officers for 1999. For 2000, our executive officers will
be eligible to receive bonuses based upon achieving a predetermined level of (a)
earnings per share on our common stock and (b) free cash flow. Free cash flow is
considered to be our (i) net
5
<PAGE> 9
income, plus (ii) depreciation, amortization and depletion, less (iii) capital
expenditures, less (iv) working capital consumed.
To the extent readily determinable, another factor the compensation
committee considers when determining compensation is the anticipated tax
treatment to our company and to the executive officer of various payments and
benefits. For example, the deductibility by our company of some types of
compensation plans depends upon the timing of an executive officer's vesting or
exercise of previously granted rights. Further interpretation of, and changes
in, the tax laws and other factors beyond the compensation committee's control
also could affect the deductibility of compensation.
Mr. Huizenga has been Chairman of the board of directors since our initial
public offering, and was our Chief Executive Officer from May 1998 until
December 1998. Mr. Huizenga is not paid any cash salary or bonus. Mr. O'Connor
has been our Chief Executive Officer since December 1998.
In January 1999 and October 1999, the compensation committee approved a
grant of options to Mr. O'Connor to purchase 80,000 and 120,000 shares of common
stock exercisable at a price of $18.4375 and $11.875 per share, respectively.
The compensation committee determined this grant to be appropriate based on the
services the committee expects Mr. O'Connor to perform as Chief Executive
Officer, his past business accomplishments, and expected future contributions to
our company. The compensation committee determined the number of shares subject
to those options to be appropriate based upon the foregoing factors, with equal
consideration given to each, and the fact that Mr. O'Connor's salary is lower
than market compensation for executives of similar background and experience.
All options granted to Mr. O'Connor in 1999 have a term of 10 years and vest in
four equal annual installments beginning on the first anniversary of the date of
the grant. During 1999, Mr. O'Connor received a salary of $450,000 and no bonus.
The compensation committee believes that tying the remuneration of our
Chief Executive Officer to the performance of our common stock will enhance our
long-term performance and stability by providing our Chief Executive Officer
with an incentive to expand our business and increase profitability in future
years. The compensation committee believes that our Chief Executive Officer's
annual salary and the grants of stock options to him, as described above,
represent a fair compensation structure for his annual services as our Chief
Executive Officer and that the grant of the options to him provides an incentive
to maximize stockholder value.
Compensation Committee:
John W. Croghan, Chairman
Ramon A. Rodriguez
Allan C. Sorensen
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Croghan and Sorensen served as members of the compensation
committee from January through October, 1999. In October, 1999, the Compensation
Committee was expanded to three members and Mr. Rodriguez was appointed to serve
on the committee with Messrs. Croghan and Sorensen. No member of the
compensation committee was an officer or employee of our company during the
prior year or was formerly an officer of our company. During the fiscal year
ended December 31, 1999, none of our executive officers served on the
compensation committee of any other entity, any of whose directors or executive
officers served either on our board of directors or on our compensation
committee.
6
<PAGE> 10
PERFORMANCE GRAPH
The following performance graph compares the performance of our common
stock to the New York Stock Exchange Composite Index and to an index of peer
companies we selected. The peer group consists of Allied Waste Industries, Inc.
and Waste Management, Inc. Our peer group in the proxy statement relating to our
1999 Annual Meeting included Browning-Ferris Industries, Inc., which was
acquired by Allied Waste Industries in July 1999. The graph covers the period
from July 1, 1998, the date of our initial public offering, to December 31,
1999. The graph assumes that the value of the investment in our common stock and
in each index was $100 at July 1, 1998 and that all dividends were reinvested.
CUMULATIVE TOTAL RETURN
BASED ON INITIAL INVESTMENT OF $100 ON JULY 1, 1998
<TABLE>
<CAPTION>
NY STOCK EXCHANGE-
REPUBLIC SERVICES, INC. COMPOSITE PEER GROUP
----------------------- ------------------ ----------
<S> <C> <C> <C>
7/98 100.00 100.00 100.00
9/98 76.47 87.17 97.37
12/98 72.31 102.95 95.00
3/99 63.48 104.30 86.17
6/99 97.06 111.99 105.59
9/99 42.65 102.43 40.30
12/99 55.88 112.37 35.11
</TABLE>
7
<PAGE> 11
EXECUTIVE COMPENSATION
The following tables set forth compensation information regarding our Chief
Executive Officer and our four most highly compensated executive officers during
the year ended December 31, 1999:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL ------------
COMPENSATION(1) SECURITIES
------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS(2) COMPENSATION
--------------------------- ---- -------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C>
James E. O'Connor................................ 1999 $440,000 $ -- 200,000 $ --
(Chief Executive Officer 1998 20,731 8,432 250,000 --
and Director)(3) 1997 -- -- -- --
Harris W. Hudson................................. 1999 484,615 -- 775,000 189,327(4)
(Vice Chairman and Secretary) 1998 396,461 200,000 -- --
1997 395,769 100,000 -- --
James H. Cosman.................................. 1999 392,308 -- 434,517 --
(President and Chief 1998 340,961 87,500 -- --
Operating Officer) 1997 300,000 75,000 -- 33,775(5)
Tod C. Holmes.................................... 1999 242,308 -- 160,000 45,852(7)
(Senior Vice President and 1998 187,692 50,000 -- 46,342(7)
Chief Financial Officer)(6) 1997 -- -- -- --
Steven R. Goldberg............................... 1999 275,000 -- 60,000 --
(Senior Vice President -- 1998 58,173 35,000 110,000 105,000(9)
Corporate Development)(8) 1997 -- -- -- --
</TABLE>
- -------------------------
(1) Except as specifically set forth in the column entitled "All Other
Compensation," the aggregate total value of perquisites, other personal
benefits, securities or property or other annual compensation did not equal
or exceed $50,000 or ten percent of the annual salary and bonus for any
person named in the chart during 1997, 1998 or 1999. Therefore, this table
does not include such information.
(2) The options listed in this column include options to acquire 258,517 and
50,000 shares of our common stock which were issued to Messrs. Cosman and
Holmes, respectively, in substitute of options previously granted to them
to acquire shares of AutoNation common stock. See "Stock Incentive Plan."
(3) Mr. O'Connor became an employee in December 1998. Mr. O'Connor's base
salary was increased to $450,000 on March 1, 1999.
(4) Consists of payments made on behalf of Mr. Hudson for aircraft use, which
were included in his Form W-2 as compensation to him.
(5) Consists of certain relocation expenses for Mr. Cosman.
(6) Mr. Holmes became an employee in January 1998.
(7) Consists of certain relocation expenses for Mr. Holmes.
(8) Mr. Goldberg became an employee in October 1998.
(9) Consists of an initial signing bonus received by Mr. Goldberg that is not
part of a recurring arrangement.
8
<PAGE> 12
OPTION GRANTS IN YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------- POTENTIAL REALIZABLE
PERCENT VALUE AT ASSUMED
NUMBER OF OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS PRICE APPRECIATION
UNDERLYING GRANTED TO FOR OPTION TERM
OPTIONS EMPLOYEES IN EXERCISE EXPIRATION ------------------------
NAME GRANTED(1) FISCAL YEAR PRICE DATE 5% 10%
---- ---------- ------------ -------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
James E. O'Connor.... 80,000 * $18.4375 1/4/09 $ 927,620 $ 2,350,770
120,000 * 11.875 10/29/09 896,175 2,271,083
Harris W. Hudson..... 650,000 4.5% 18.4375 2/24/09 7,536,909 19,100,007
125,000 * 11.875 10/29/09 933,515 2,365,711
James H. Cosman...... 80,000 * 18.4375 1/4/09 927,620 2,350,770
96,000 * 11.875 10/29/09 716,940 1,816,866
163,333 1.1 17.50 1/2/07 1,797,587 4,555,438
95,184 * 17.50 1/2/08 1,047,562 2,654,729
Tod C. Holmes........ 50,000 * 18.4375 1/4/09 579,762 1,469,231
60,000 * 11.875 10/29/09 448,087 1,135,542
50,000 * 17.50 1/26/08 550,283 1,394,525
Steven R. Goldberg... 60,000 * 11.875 10/29/09 448,087 1,135,542
</TABLE>
- -------------------------
* Less than 1%.
(1) The options listed in this column include options to acquire 258,517 shares
of our common stock which were issued to Mr. Cosman and options to acquire
50,000 shares of our common stock which were issued to Mr. Holmes, each as
replacement for options to acquire shares of AutoNation common stock
previously granted to them.
YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS
DECEMBER 31, 1999(1) DECEMBER 31, 1999(1)
--------------------------- ---------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
James E. O'Connor....................... 109,375 340,625 $-- $285,000
Harris W. Hudson........................ -- 775,000 -- 296,875
James H. Cosman......................... 105,463 329,054 -- 228,000
Tod C. Holmes........................... 12,500 147,500 -- 142,500
Steven R. Goldberg...................... 27,500 142,500 -- 142,500
</TABLE>
- -------------------------
(1) The options listed in this column include options to acquire 258,517 shares
of our common stock which were issued to Mr. Cosman and options to acquire
50,000 shares of our common stock which were issued to Mr. Holmes, each as
replacement for options to acquire shares of AutoNation common stock
previously granted to them. Messrs. Cosman and Holmes entered into stock
option repricing agreements with AutoNation in 1998, which restricted the
exercise of vested substitute options until January 5, 2000.
COMPENSATION OF DIRECTORS
We pay each of our non-employee directors $25,000 per year, and $1,000 for
each board or committee meeting they attend in person. Under our 1998 Stock
Incentive Plan, we grant options to purchase shares of common stock to our
non-employee directors. As of March 14, 2000, we have granted options to
purchase 200,000 shares of our common stock to our non-employee directors. We
also reimburse our non-employee directors for reasonable expenses incurred for
attending board of director and committee meetings. We have not adopted any
other policies regarding directors' compensation and benefits.
EMPLOYMENT AGREEMENTS
We entered into a three year employment agreement with James E. O'Connor to
serve as our Chief Executive Officer, effective as of December 7, 1998. The
employment agreement provides that our board of directors will appoint Mr.
O'Connor to the board and
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<PAGE> 13
that Mr. O'Connor will be nominated for election to our board of directors at
each annual meeting of our stockholders during the term of the agreement. The
employment agreement provides that Mr. O'Connor will receive an initial annual
base salary of $385,000, subject to annual review and adjustment. In addition,
Mr. O'Connor will be eligible for an annual bonus of up to 30% of his base
salary, based on the achievement of certain corporate goals and objectives.
Under his employment agreement, Mr. O'Connor also received options upon
employment to purchase up to 250,000 shares of our common stock, of which 62,500
shares were fully vested and could be purchased immediately. The remaining
shares shall vest and be eligible for purchase in four equal annual installments
of 46,875 shares beginning on the first anniversary of the date of grant. If we
terminate Mr. O'Connor "without cause" or if he elects to terminate his
employment for "good reason," in each case as defined in his employment
agreement, Mr. O'Connor will continue to receive his salary and health benefits
for a period ending on the later of the first anniversary of the termination or
the end of his employment period. Mr. O'Connor is also subject to
confidentiality obligations as well as to non-compete and non-solicitation
covenants for a three year period following the termination of his employment
period.
We entered into a three year employment agreement with Mr. Cosman, our
President and Chief Operating Officer, effective as of January 11, 1999. The
employment agreement provides that Mr. Cosman will receive an initial annual
base salary of $400,000, subject to annual review and adjustment. In addition,
Mr. Cosman will be eligible for an annual bonus of up to 30% of his base salary,
based on the achievement of certain corporate goals and objectives. If we
terminate Mr. Cosman "without cause" or if he elects to terminate his employment
for "good reason," in each case as defined in his employment agreement, Mr.
Cosman will continue to receive his salary and health benefits for a period
ending on the later of the first anniversary of the termination or the end of
his employment period. Mr. Cosman is also subject to confidentiality obligations
as well as to non-compete and non-solicitation covenants for a three year period
following the termination of his employment period.
On July 1, 1999, we entered into a three year employment agreement with Tod
C. Holmes, our Senior Vice President and Chief Financial Officer. The employment
agreement provides that Mr. Holmes will receive an initial annual base salary of
$250,000, subject to annual review and adjustment. In addition, Mr. Holmes will
be eligible for an annual bonus of up to 30% of his base salary, based on the
achievement of certain corporate goals and objectives. If we terminate Mr.
Holmes "without cause" or if he elects to terminate his employment for "good
reason," in each case as defined in his employment agreement, Mr. Holmes will
continue to receive his salary and health benefits for a period ending on the
later of the first anniversary of the termination or the end of his employment
period. Mr. Holmes is also subject to confidentiality obligations as well as to
non-compete and non-solicitation covenants for a three year period following the
termination of his employment period.
SEVERANCE AGREEMENT
Mr. Goldberg entered into a severance agreement with us which provides that
if we terminate his employment without cause in the first 24 months of his
employment, then Mr. Goldberg will receive severance pay equal to his base
monthly salary for a period of 18 months as well as a prorated portion of his
annual incentive bonus. All options granted to him under our 1998 Stock
Incentive Plan would continue to vest throughout the severance period.
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<PAGE> 14
STOCK INCENTIVE PLAN
In July 1998, we adopted our 1998 Stock Incentive Plan to provide for the
grant of options to purchase shares of common stock, stock appreciation rights
and stock grants to employees, non-employee directors and consultants who are
eligible to participate in the Stock Incentive Plan. The Stock Incentive Plan
provides for the grant of options to employees and independent contractors at
the discretion of our board of directors. Additionally, the Stock Incentive Plan
provides for an automatic grant of an option to purchase 50,000 shares of common
stock to each member of the board of directors who joins the board of directors
as a non-employee director, and an additional automatic grant of an option to
purchase 10,000 shares of common stock at the beginning of each fiscal year
after the member joins the board if he remains as a board member. We have
reserved 20 million shares of common stock for issuance as a result of options
granted under the Stock Incentive Plan.
Prior to our initial public offering, our employees were granted stock
options under AutoNation's stock option plans. As of March 2, 1999, options to
purchase approximately 8.0 million shares of AutoNation common stock held by our
employees were canceled by AutoNation, and our compensation committee granted
replacement options on a one-for-one basis. The replacement options to purchase
shares of our common stock retained the vesting and exercise rights of the
original options, subject to certain exercise limitations for individuals who
signed stock option repricing agreements with AutoNation. The exercise prices
for individual replacement options were established to maintain the unrealized
gain or loss on each option of AutoNation stock that was canceled. On January 4,
1999, we issued approximately 2.0 million shares of options to purchase common
stock, representing our annual grant for fiscal 1999. On October 29, 1999, we
issued approximately 2.8 million options to purchase shares of common stock,
representing our annual grant for fiscal 2000.
As of March 14, 2000, we had options to purchase approximately 15.0 million
shares of our common stock outstanding under our 1998 Stock Incentive Plan. At
our annual meeting, we will seek stockholder approval and adoption of the 1998
Stock Incentive Plan in order to qualify grants under the plan as
performance-based compensation for purposes of the Internal Revenue Code. For a
more complete description of our 1998 Stock Incentive Plan and a discussion
regarding its inclusion for stockholder consideration and approval at our 2000
Annual Meeting, please refer to Proposal 2, which begins on page 18 of our Proxy
Statement.
401(K) PLAN
We have adopted a 401(k) Savings and Retirement Plan that qualifies for
preferential tax treatment under section 401(a) of the Internal Revenue Code.
Under the plan, all of our employees who are not covered by a collective
bargaining agreement may participate in the plan following 90 days of service
with the company. Our employees are permitted to contribute up to 15% of their
salaries (up to a maximum contribution of $10,500 per year). We match one-half
of the first four percent of an employee's contributions under the plan in
shares of our common stock. The match is made on a quarterly basis and is fully
vested when made.
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<PAGE> 15
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Prior to our initial public offering on July 1, 1998, we had been a wholly
owned subsidiary of AutoNation. After our our initial public offering,
AutoNation owned 63.9% of our outstanding common stock. AutoNation sold
substantially all of its shares of our common stock in a secondary public
offering in May 1999. AutoNation currently owns approximately 3.2 million shares
of our common stock, which constitutes approximately 1.8% of the outstanding
shares of our common stock. Mr. Huizenga is the Chairman of the Board of
AutoNation, and Mr. Hudson is the Vice Chairman and a director of AutoNation. As
of March 14, 2000, Messrs. Huizenga and Hudson directly or indirectly
beneficially owned a total of more than 10% of AutoNation's outstanding common
stock, including their presently exercisable options to purchase AutoNation
common stock. As a result, the following transactions between our company and
AutoNation may be deemed to be intercompany or related party transactions.
SERVICES AGREEMENT
As part of the our separation from AutoNation, in June 1998 we entered into
a Services Agreement with AutoNation pursuant to which AutoNation provided us
with certain accounting, auditing, cash management, corporate communications,
corporate development, financial and treasury, human resources and benefit plan
administration, insurance and risk management, legal, purchasing and tax
services. In exchange for the provision of these services, we paid AutoNation
$1.25 million per month, subject to review and adjustment from time to time as
we reduced the amount of services we obtained from AutoNation. Effective on
January 1, 1999, the fees payable to AutoNation under the Services Agreement
were reduced to $0.9 million per month. The Services Agreement expired June 30,
1999. We believe that the fees for services provided under the Services
Agreement were no less favorable to us than we could have obtained internally or
from unaffiliated third parties. Charges under the Services Agreement for the
year ended December 31, 1999 were $5.3 million.
SEPARATION AND DISTRIBUTION AGREEMENT
The Separation and Distribution Agreement that we entered into with
AutoNation in June 1998 provided for the principal corporate transactions
required to effect our separation from AutoNation and contemplated a tax-free
distribution of our common stock to AutoNation's stockholders, and for other
arrangements governing the future relationship between our company and
AutoNation.
Under the Separation and Distribution Agreement, AutoNation separated the
assets and liabilities related to its automotive businesses from the assets and
liabilities related to our solid waste services business, and we reorganized
internally within our consolidated group of subsidiaries certain subsidiaries
engaged in the solid waste services business that we owned directly or
indirectly. In July 1998, we issued and sold 63,250,000 shares of our Class A
common stock in our initial public offering, resulting in net proceeds of
approximately $1.4 billion. We used all the net proceeds, and issued to
AutoNation an additional 16,474,417 shares of our Class A common stock, to repay
in full all amounts that we owed to AutoNation.
Under the Separation and Distribution Agreement, the contemplated
distribution by AutoNation to its stockholders of our common stock was subject
to the satisfaction or
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<PAGE> 16
waiver by the AutoNation board of directors, in its sole discretion, of several
conditions, including the receipt of a favorable private letter ruling from the
Internal Revenue Service to the effect that the spin-off would be tax-free to
AutoNation and its stockholders. In March 1999, the Internal Revenue Service
advised AutoNation in writing that it would not rule as requested. As a result,
with our consent, AutoNation exercised its right under the Separation and
Distribution Agreement to have us register all of the common stock it owned,
resulting in a secondary public offering of our common stock in May 1999.
Releases and Indemnification. The Separation and Distribution Agreement
provides for a full and complete mutual release and discharge as of the time we
made our initial public offering of all liabilities, including any contractual
agreements or arrangements existing or alleged to exist, existing or arising
from all acts and events occurring or failing to occur or alleged to have
occurred or to have failed to occur and all conditions existing or alleged to
have existed on or before our initial public offering, between our company and
AutoNation including in connection with the transactions and all other
activities to implement our separation from AutoNation. The agreement also
provides for indemnification by each party in favor of the other party with
respect to specified matters relating to the Separation and Distribution
Agreement, our initial public offering and the secondary offering of our common
stock owned by AutoNation.
Contingent Liabilities and Contingent Gains. The Separation and
Distribution Agreement provides for indemnifications between our company and
AutoNation regarding contingent liabilities primarily relating to our respective
businesses or otherwise assigned to our company, and provides that the parties
will each have the exclusive right to any benefit received with respect to any
contingent gain that primarily relates to the business of that party, or that is
expressly assigned to that party.
Certain Business Restrictions. Under the terms of the Separation and
Distribution Agreement, AutoNation has agreed that, for a period of five years
after we are no longer a subsidiary of AutoNation, AutoNation will not directly
or indirectly compete with us in the solid waste services industry anywhere in
North America, and we have agreed that, for a period of five years after that
time, we will not directly or indirectly compete with AutoNation in the
automotive retail or vehicle rental industries anywhere in North America.
TAX INDEMNIFICATION AND ALLOCATION AGREEMENT
In connection with our separation from AutoNation, we entered into a Tax
Indemnification and Allocation Agreement with AutoNation that provides that
AutoNation will indemnify us for income taxes that we might incur with respect
to certain internal restructuring transactions that we entered into in June 1998
in connection with our initial public offering.
We were included in AutoNation's consolidated group for federal income tax
purposes for periods during which AutoNation beneficially owned at least 80% of
the total voting power and value of our outstanding common stock. Each
corporation that is a member of a consolidated group during any portion of the
group's tax year is jointly and severally liable for the federal income tax
liability of the group for that year. We and our subsidiaries stopped being
members of AutoNation's consolidated group after we became a public company in
July 1998. While the Tax Indemnification and Allocation Agreement allocates tax
liabilities between AutoNation and our company during the periods when we were
included in AutoNation's consolidated group, we could be liable in the event
federal tax
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<PAGE> 17
liability allocated to AutoNation is incurred, but not paid, by AutoNation or
any other member of AutoNation's consolidated group for AutoNation's tax years
before we were a public company. If this were to happen, we could seek
indemnification from AutoNation under the Tax Indemnification and Allocation
Agreement.
EMPLOYEE BENEFITS
We entered into an Employee Benefits Agreement with AutoNation under which
we have assumed and agreed to pay, perform, fulfill and discharge all
liabilities to, or relating to, former employees of AutoNation or its affiliates
whom we employed as of May 1999 after we were no longer affiliated with
AutoNation and certain former employees of AutoNation or its affiliates,
including retirees, who were employed by or provided services primarily for our
solid waste business. Now that we are no longer affiliated with AutoNation,
these employees and former employees no longer participate in AutoNation's
employee benefit plans, although we were responsible for our allocable share of
the costs of such plans. In April and May of 1999 we established our own
employee benefit plans, which are generally similar to AutoNation's plans then
in effect. The Employee Benefits Agreement that we are describing does not
preclude our company from discontinuing or changing such plans at any time
thereafter, with a few exceptions. Our plans generally assume all liabilities
under AutoNation's plans to employees and former employees that are applicable,
and any assets funding these liabilities have been transferred from funding
vehicles associated with AutoNation's plans to the corresponding funding
vehicles associated with our plans.
REPLACEMENT OPTIONS
Prior to our initial public offering, our employees were granted options to
purchase AutoNation common stock under AutoNation's stock option plans. In March
1999, the approximately 8.0 million AutoNation stock options held by our
employees were canceled, and our company's Compensation Committee granted
replacement options to purchase our common stock on a one-for-one basis. The
replacement options retained the vesting and exercise rights of the original
options, subject to exercise limitations for individuals who signed stock option
repricing agreements with AutoNation. The exercise price for individual
replacement options are priced so that the potential gain or loss on each grant
of AutoNation stock options at the time generally was maintained under the
replacement options. We recorded $2.0 million of compensation expense during the
three months ended March 31, 1999 relating to our granting of replacement
options at favorable exercise prices.
LEASE
In July 1998, we signed a lease with a subsidiary of AutoNation for
approximately 10,555 square feet of office space at AutoNation's corporate
headquarters in Fort Lauderdale, Florida. The annual lease rate is $220,320
($20.40 per square foot), and we pay for certain common area maintenance
charges. Effective January 1999, we amended the lease to increase the space we
are renting to approximately 14,443 square feet at an annual rate of $294,637
($20.40 per square foot). The lease had an initial term of one year which we
renewed in July 1999 for an additional one year term through June 2000. We can
terminate the lease on 90 days' prior written notice. The rent includes
utilities, security, parking, building maintenance and cleaning services. We
believe that the lease is on terms no less favorable than could be obtained from
persons unrelated to our company.
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<PAGE> 18
OTHER RELATIONSHIPS WITH AUTONATION
During 1999, we collected solid waste from, and leased roll-off containers
to, certain automotive retail and vehicle rental subsidiaries and other
properties of AutoNation. We provided all of these services at standard rates.
We continue to provide these services to AutoNation on the same terms. During
1999, we rented vehicles from AutoNation's Alamo Rent-A-Car and National Car
Rental System subsidiaries, under standard form vehicle rental agreements under
which we were charged standard rates. We still, at times, rent vehicles from
AutoNation's car rental companies on the same terms.
OTHER TRANSACTIONS WITH RELATED PARTIES
The following is a summary of other agreements and transactions that we are
involved in with related parties. It is our policy that transactions with
related parties must be on terms that, on the whole, are no less favorable than
those that would be available from unaffiliated parties. Based on our
experience, it is our belief that all of these transactions met that standard at
the time such transactions were effected.
Pro Player Stadium is a professional sports stadium in South Florida that
is owned and controlled by Mr. Huizenga. One of our subsidiaries collected solid
waste from, and leased roll-off waste containers to, Pro Player Stadium pursuant
to standard agreements under which Pro Player Stadium paid an aggregate of
approximately $250,566 in 1999. During 1999, one of our subsidiaries collected
solid waste from the National Car Rental Center, an arena in Broward County,
Florida, which is operated by a subsidiary of Boca Resorts. For these services,
our subsidiary was paid $88,604. Mr. Huizenga is the Chairman of and controls
Boca Resorts, and Mr. Hudson is a director of Boca Resorts. We expect to
continue to provide these services in 2000 on the same terms.
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<PAGE> 19
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely upon a review of (1) Forms 3 and 4 and amendments to each form
furnished to us pursuant to Rule 16a-3(e) under the Exchange Act during our
fiscal year ended December 31, 1999, (2) any Forms 5 and amendments to the form
furnished to us with respect to our fiscal year ended December 31, 1999, and (3)
any written representations referred to us in subparagraph (b)(2)(i) of Item 405
of Regulation S-K under the Exchange Act, no person who at any time during the
fiscal year ended December 31, 1999 was a director, officer or, to our
knowledge, a beneficial owner of more than 10% of our common stock failed to
file on a timely basis reports required by Section 16(a) of the Exchange Act
during the fiscal year ended December 31, 1999 or prior fiscal years.
SECURITY OWNERSHIP OF
BENEFICIAL OWNERS AND MANAGEMENT
The following table shows certain information as of March 14, 2000 with
respect to the beneficial ownership of common stock by (1) each of our
stockholders who is known by us to be a beneficial owner of more than 5% of our
outstanding common stock, (2) each of our directors, (3) our Chief Executive
Officer and each of our four other most highly compensated officers, and (4) all
of our current directors and executive officers as a group. We have adjusted
share amounts and percentages shown for each individual, entity or group in the
table to give effect to shares of common stock that are not outstanding but
which the individual, entity or group may acquire upon exercise of all options
exercisable within 60 days of March 14, 2000. However, we do not deem these
shares of common stock to be outstanding for the purpose of computing the
percentage of outstanding shares beneficially owned by any other individual,
entity or group.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
NAME OF -------------------------
BENEFICIAL OWNER NUMBER PERCENT
---------------- ----------- --------
<S> <C> <C>
Subsidiaries of FMR Corporation............................. 19,447,300(1) 11.1%
Cascade Investment LLC...................................... 9,090,200(2) 5.2%
H. Wayne Huizenga........................................... 200,000(3) *
James E. O'Connor........................................... 136,575(4) *
Harris W. Hudson............................................ 162,500(5) *
John W. Croghan............................................. 170,000(6) *
Ramon A. Rodriguez.......................................... 60,000(7) *
Allan C. Sorensen........................................... 70,000(8) *
James H. Cosman............................................. 217,817(9) *
Tod C. Holmes............................................... 48,000(10) *
Steven R. Goldberg.......................................... 32,500(11) *
All directors and executive officers as a group (10
persons).................................................. 1,141,334(12) *
</TABLE>
- -------------------------
* Less than 1 percent
(1) Includes 18,161,300 shares owned by Fidelity Management & Research Company
and 1,286,000 shares owned by Fidelity Management Trust Company. Fidelity
Management & Research and Fidelity Management Trust are both wholly-owned
subsidiaries of FMR Corporation. This information is based on Amendment No.
2 to Schedule 13G filed with the SEC by FMR Corporation, dated February 11,
2000.
(2) Based on the Schedule 13G filed with the SEC by Cascade Investment, dated
November 10, 1999.
(3) The aggregate amount of common stock beneficially owned by Mr. Huizenga
consists of vested options to purchase 200,000 shares.
(4) The aggregate amount of common stock beneficially owned by Mr. O'Connor
consists of 7,200 shares owned directly by him and vested options to
purchase 129,375 shares.
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<PAGE> 20
(5) The aggregate amount of common stock beneficially owned by Mr. Hudson
consists of vested options to purchase 162,500 shares.
(6) The aggregate amount of common stock beneficially owned by Mr. Croghan
consists of 100,000 shares owned directly by him and vested options to
purchase 70,000 shares.
(7) The aggregate amount of common stock beneficially owned by Mr. Rodriguez
consists of vested options to purchase 60,000 shares.
(8) The aggregate amount of common stock beneficially owned by Mr. Sorensen
consists of vested options to purchase 70,000 shares.
(9) The aggregate amount of common stock beneficially owned by Mr. Cosman
consists of 27,725 shares owned by Mr. Cosman and his wife as joint tenants
and vested options to purchase 190,092 shares.
(10) The aggregate amount of common stock beneficially owned by Mr. Holmes
consists of 10,500 shares owned directly by him and vested options to
acquire 37,500 shares.
(11) The aggregate amount of common stock beneficially owned by Mr. Goldberg
consists of 5,000 shares owned directly by him and vested options to
acquire 27,500 shares.
(12) The aggregate amount of common stock beneficially owned by all directors
and executive officers as a group consists of (a) 150,425 shares and (b)
vested options to purchase 990,909 shares.
PROPOSAL 1
ELECTION OF DIRECTORS
The board of directors currently consists of six members. The board of
directors has designated the persons named below as nominees for election as
directors, for a term expiring at the annual meeting of stockholders in the year
2001. All nominees are currently serving as directors. Each director is elected
by the affirmative vote of a plurality of the votes cast by the shares of common
stock present at the annual meeting, in person or by proxy, and entitled to vote
for the election of directors. It is the intention of the persons named in the
enclosed form of proxy to vote the proxies they receive for the election of the
nominees named below, unless a particular proxy withholds authorization to do so
or provides other contrary instructions. Each of the nominees has indicated that
he is willing and able to serve as a director. If before the annual meeting any
nominee becomes unable to serve, an event which is not anticipated by the board
of directors, the proxies will be voted for the election of whomever the board
of directors may designate.
NOMINEES FOR DIRECTOR
H. Wayne Huizenga
Harris W. Hudson
James E. O'Connor
John W. Croghan
Ramon A. Rodriguez
Allan C. Sorensen
Beginning on page 2 of this proxy statement we provide biographical
information relating to each of these nominees for director under the heading
"Biographical Information Regarding Directors/Nominees and Executive Officers."
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ELECTION OF
EACH OF THE NOMINEES FOR DIRECTOR NAMED ABOVE. PROXY CARDS EXECUTED AND RETURNED
WILL BE SO VOTED UNLESS CONTRARY INSTRUCTIONS ARE INDICATED THEREON.
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<PAGE> 21
PROPOSAL 2
1998 STOCK INCENTIVE PLAN
We originally established our 1998 Stock Incentive Plan effective July 1,
1998, and AutoNation, as our sole stockholder at that time, approved the plan by
written consent. We amended the plan on March 22, 2000 to provide for the plan's
termination on July 1, 2008. The purpose of our Stock Incentive Plan is to
optimize our profitability and growth through incentives that are consistent
with our goals and that link the individual interests of participants in our
Stock Incentive Plan with those of our stockholders; to provide participants
with an incentive for excellence in individual performance; to provide us
flexibility in our ability to motivate, attract and retain employees who make
significant contributions to our success; and to allow employees to share in our
success. Our compensation committee has made 1999 and 2000 awards of stock
options under our Stock Incentive Plan, and we believe that under the transition
rule provided in Treasury Regulation 1.162-27(f)(4)(iii), the stock options
qualify as performance-based compensation under Section 162(m) of the Internal
Revenue Code.
We are asking our current stockholders to approve the Stock Incentive Plan
simply to permit us to deduct compensation to a "covered employee", as defined
in Section 162(m) of the Internal Revenue Code, which is in excess of
$1,000,000. Whether or not our current stockholders approve the Stock Incentive
Plan, stock options previously granted under the plan will remain outstanding
and become exercisable pursuant to the terms of the Stock Incentive Plan.
However, if our current stockholders do not approve the Stock Incentive Plan, in
any calendar year where awards made under the plan following our 2000 Annual
Meeting of Stockholders are exercised by any person who is a "covered employee"
and the exercise results in such person having annual compensation from their
employment with us in excess of $1,000,000, we will not receive an income tax
deduction for such compensation which is in excess of $1,000,000.
The affirmative vote of the holders of a majority of our common stock
present at the annual meeting, in person or by proxy, and entitled to vote is
required to approve and adopt the Stock Incentive Plan.
MATERIAL TERMS OF OUR 1998 STOCK INCENTIVE PLAN
We have summarized the material terms of our Stock Incentive Plan below.
The full text of our Stock Incentive Plan, as amended, which you are urged to
read carefully, is set forth as Appendix A to this proxy statement.
Duration. Our Stock Incentive Plan will remain in effect until all awards
made under it have either been satisfied by the issuance of our common stock
and/or the payment of cash, or the time periods for exercising all rewards made
under our Stock Incentive Plan have expired, unless earlier terminated by the
Board of Directors. No awards may be made under our Stock Incentive Plan on or
after July 1, 2008.
Administration. Our compensation committee administers our Stock Incentive
Plan and makes awards pursuant to its terms.
Participation. Employees, consultants and non-employee directors of our
company or any subsidiary of our company are eligible to receive awards under
our Stock Incentive Plan. Our compensation committee determines which
individuals are to receive awards in
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<PAGE> 22
any year based upon the individuals potential to contribute to our success,
and/or the success of our subsidiaries.
Awards. Our compensation committee determines the amount, type, terms and
conditions of each award, the details of which are generally reflected in an
award agreement between us and each participant. Our Stock Incentive Plan
permits rewards of (i) options to acquire our common stock, (ii) rights to
receive a payment in cash, our common stock, or a combination of cash and our
common stock, equal to the excess of the aggregate market price at the time of
exercise of a specified number of our shares of common stock over the aggregate
exercise price of the right being exercised, and (iii) our stock, or the right
to receive our stock (or the cash equivalent or a combination of cash and our
common stock), in the future. Our compensation committee may adjust outstanding
awards in recognition of unusual or nonrecurring events affecting us or our
financial statements and/or changes in applicable laws, regulations or
accounting principles, unless an adjustment would cause an award designed to
qualify as performance-based compensation for purposes of Section 162(m) of the
Internal Revenue Code to fail to so qualify, in which case no adjustment may be
made.
Award Prices and Vesting. All awards under our Stock Incentive Plan are
made in our common stock, par value $.01, at a price equal to the closing price
of our common stock on the business day prior to the day on which the award is
granted or at a price fixed by our compensation committee in good faith as 100%
of the fair market value of our common stock. The minimum vesting period for all
awards shall be one year, except for awards made in lieu of cash compensation
which may vest immediately.
Maximum Awards. The maximum number of shares of our common stock with
respect to which awards may be made under our Stock Incentive Plan is
20,000,000. The maximum aggregate number of shares of our common stock with
respect to which awards of stock options or stock appreciation rights may be
made to any one individual under our Stock Incentive Plan in any one calendar
year is 5,000,000. The maximum aggregate number of shares of our common stock
with respect to which grants of stock awards may be made to any one individual
under our Stock Incentive Plan is 1,000,000, and shall be cumulative over the
life of the Stock Incentive Plan. Both numbers may be adjusted to reflect any
change in our capitalization due to certain corporate transactions, including,
without limitation, stock dividends, stock splits, extraordinary cash dividends,
recapitalizations, reorganizations, mergers, consolidations, split-ups,
spin-offs, combinations or exchanges of shares of our common stocks. Shares of
our common stock issued under our Stock Incentive Plan may be either authorized
and unissued shares of our common stock, shares of common stock held in our
treasury, or a combination of the two.
Deferrals. Our compensation committee may permit or require any
participant in our Stock Incentive Plan to defer receipt of a cash payment or
delivery of shares of our common stock otherwise due the participant.
Directors. Non-employee directors shall receive one grant of an option to
purchase 50,000 shares of our common stock upon appointment to the Board of
Directors and subsequent annual grants of options to purchase 10,000 shares of
our common stock. All options granted to our non-employee directors will be
immediately exercisable.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE APPROVAL AND
ADOPTION OF OUR 1998 STOCK INCENTIVE PLAN.
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<PAGE> 23
PROPOSAL 3
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
The board of directors, upon recommendation of the audit committee, has
approved and recommends the appointment of Arthur Andersen LLP as independent
public accountants of our company and its subsidiaries for the year ending
December 31, 2000.
Arthur Andersen LLP has been serving AutoNation and our company in this
capacity since May 1990. A representative of Arthur Andersen LLP is expected to
attend the annual meeting and be available to respond to appropriate questions.
The representative will also be afforded an opportunity to make a statement, if
he desires to do so.
Ratification of the board of directors' selection of Arthur Andersen LLP
will require the affirmative vote of the holders of a majority of the total
shares of common stock present at the annual meeting, in person or by proxy, and
entitled to vote on the matter at the annual meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE RATIFICATION
OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS INDEPENDENT PUBLIC ACCOUNTANTS OF
OUR COMPANY FOR THE YEAR ENDING DECEMBER 31, 2000, AND PROXIES EXECUTED AND
RETURNED WILL BE SO VOTED UNLESS CONTRARY INSTRUCTIONS ARE INDICATED THEREON.
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<PAGE> 24
STOCKHOLDER PROPOSALS
We must receive any proposals of stockholders intended to be presented at
the year 2001 annual meeting for inclusion in the proxy statement and form of
proxy relating to that meeting not later than December 1, 2000. We suggest that
proponents submit their proposals by certified mail, return receipt requested.
Detailed information for submitting resolutions will be provided upon written
request to the Secretary of our company at Republic Services, Inc., 110 S.E. 6th
Street, Fort Lauderdale, Florida 33301. We have not received any stockholder
proposals for inclusion in this proxy statement.
OTHER MATTERS
You are again invited to attend the annual meeting at which our management
will present a review of our progress and operations.
Management does not intend to present any other items of business and knows
of no other matters that will be brought before the annual meeting. However, if
any additional matters are properly brought before the annual meeting, the
persons named in the enclosed proxy shall vote the proxies in their discretion
in the manner they believe to be in the best interest of our company. We have
prepared the accompanying form of proxy at the direction of the board of
directors and provide it to you at the request of the board of directors. Your
board of directors has designated the proxies named therein.
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<PAGE> 25
APPENDIX A
REPUBLIC SERVICES, INC.
1998 STOCK INCENTIVE PLAN
1. THE PLAN
This Republic Services, Inc. 1998 Stock Incentive Plan (the "Plan") is
intended to benefit the stockholders of Republic Services, Inc. (the "Company")
by providing a means to attract, retain and reward individuals who contribute to
the long term financial success of the Company. Further, the recipients of
stock-based awards under the Plan will identify their success with that of the
Company's stockholders and will be encouraged to increase their proprietary
interest in the Company.
ADMINISTRATION
a) Committee. The Plan shall be administered by a Committee (the
"Committee"), appointed by the Board of Directors of the Company (the "Board"),
which shall consist of no less than two of its members, all of whom qualify as
"outside directors" under Section 162(m) of the Internal Revenue Code of 1986
(the "IRC") provided, however, that from time to time the Board may assume, at
its sole discretion, administration of the Plan and the Board reserves the power
to make adjustments for corporate transactions described in Section 3(d). Except
with regard to awards to employees subject to Section 16 of the Securities
Exchange Act of 1934, the Committee may delegate certain responsibilities and
powers to any executive officer or officers selected by it. Any such delegation
may be revoked by the Committee at any time.
b) Powers and Authority. The Committee's powers and authority include, but
are not limited to: selecting individuals, who are employees, consultants, or
non-employee directors of the Company and any subsidiary of the Company or other
entity in which the Company has a significant equity or other interest as
determined by the Committee, to receive awards; determining the types and terms
and conditions of all awards granted, including performance and other earnout
and/or vesting contingencies; permitting transferability of awards to eligible
third parties; interpreting the Plan's provisions; and administering the Plan in
a manner that is consistent with its purpose. The Committee's decision in
carrying out the Plan and its interpretation and construction of any provisions
of the Plan or any award granted or agreement or other instrument executed under
it shall be final and binding upon all persons. No members of the Board shall be
liable for any action or determination made in good faith in administering the
Plan.
c) Award Prices. All awards will be denominated or made in shares of the
Company's Class A Common Stock par value $.01 (the "Stock") which price shall
equal no less than 100% of the fair market value which shall mean either the
closing price of the Stock on the business day prior to the applicable date or
at a price otherwise fixed by the Committee in good faith as 100% of the fair
market value of the Stock. The applicable date shall be the day on which the
award is granted (or other Plan transaction occurs), except that the Committee
may provide that the applicable date may be, in the case of a stock option or
stock appreciation right granted retroactively in tandem with or as a
substitution for another previously granted stock option or stock appreciation
right, the
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applicable date for such prior award. Except as provided for in Section 3(d),
the per share exercise price of any stock option or stock appreciation right may
not be decreased after the grant of the award, and a stock option or stock
appreciation right may not be surrendered as consideration in exchange for the
grant of a new award with a lower exercise price per share of Stock.
d) Award Agreements and Vesting. All awards shall be evidenced by a signed
award agreement. These agreements shall specify the terms of the awards
including their vesting schedule and any other criteria, such as performance
criteria, which will be required for vesting or early vesting of the award. The
minimum vesting period for all awards shall be one year, except for awards made
in lieu of cash compensation which may vest immediately.
2. SHARES OF STOCK SUBJECT TO THE PLAN AND ADJUSTMENTS
a) Maximum Shares of Stock Available for Delivery. Subject to Section
3(d), the maximum number of shares of Stock that may be delivered to
participants and their beneficiaries under the Plan shall be 20,000,000 shares
of Stock. Any Stock granted under the Plan which are forfeited back to the
Company because of the failure to meet an award contingency or condition shall
again be available for delivery pursuant to new awards granted under the Plan.
Any Stock covered by an award (or portion of an award) granted under the Plan,
which is forfeited or canceled, expires or is settled in cash, including the
settlement of tax withholding obligations using Stock, shall be deemed not to
have been delivered for purposes of determining the maximum number of shares of
Stock available for delivery under the Plan. Likewise, if any stock option is
exercised by tendering shares of Stock, either actually or by attestation, to
the Company as full or partial payment for such exercise under this Plan or any
prior plan of the Company, only the number of shares issued net of the shares
tendered shall be deemed delivered for purposes of determining the maximum
number of shares of Stock available for delivery under the Plan. Further, Stock
issued under the Plan through the settlement, assumption or substitution of
outstanding awards or obligations to grant future awards as a condition of the
Company acquiring another entity shall not reduce the maximum number of shares
of Stock available for delivery under the Plan.
b) Other Plan Limits. Subject to Section 3(d), the following additional
maximums are imposed under the Plan. The maximum number of shares of Stock that
may be issued in connection with stock options intended to comply with Section
422 or any other similar provision of the IRC shall be 20,000,000. The maximum
aggregate number of shares of Stock that may be covered by awards granted to any
one individual pursuant to Sections 4(b) and 4(c) shall not exceed 5,000,000.
The maximum number of shares of Stock that may be issued to all participants in
conjunction with awards granted pursuant to Section 4(d) shall be 5,000,000. The
maximum number of shares of Stock or equivalent cash payment that can be earned
each year for awards granted to any one individual pursuant to Section 4(d)
shall be 1,000,000, and shall be cumulative over the life of the Plan.
c) Payment Shares of Stock. Subject to the overall limitation on the
number of shares of Stock that may be delivered under the Plan, the Committee
may, in addition to granting awards under Section 4, use available Stock as the
form of payment for compensation, grants or rights earned or due under any other
compensation plans or arrangements of the Company, including those of any entity
acquired by the Company.
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d) Adjustments for Corporate Transactions.
(i) The Board may determine that a corporate transaction has affected
the price of the Stock such that an adjustment or adjustments to
outstanding awards are required to preserve (or prevent enlargement of) the
benefits or potential benefits intended at time of grant. For this purpose
a corporate transaction may include, but is not limited to, any stock
dividend, stock split, extraordinary cash dividend, recapitalization,
reorganization, merger, consolidation, split-up, spin-off, combination or
exchange of shares of Stock, or other similar occurrence. In the event of
such a corporate transaction, the Board may, in such manner as the Board
deems equitable, adjust (i) the number and kind shares of Stock which may
be delivered under the Plan pursuant to Sections 3(a) and 3(b); (ii) the
number and kind of shares of Stock subject to outstanding awards; and (iii)
the exercise price of outstanding stock options and stock appreciation
rights.
(ii) In the event that the Company is not the surviving company of a
merger, consolidation or amalgamation with another company, or in the event
of a liquidation or reorganization of the Company, and in the absence of
the surviving corporation's assumption of outstanding awards made under the
Plan, the Board may provide for appropriate adjustments and/or settlements
of such grants either at the time of grant or at a subsequent date. The
Board may also provide for adjustments and/or settlements of outstanding
awards as it deems appropriate and consistent with the Plan's purpose in
the event of any other change-in-control of the Company.
3. TYPES OF AWARDS
a) General. An award may be granted singularly, in combination with
another award(s) or in tandem whereby exercise or vesting of one award held by a
participant cancels another award held by the participant. Subject to Section
2(c), an award may be granted as an alternative to or replacement of an existing
award under the Plan or under any other compensation plans or arrangements of
the Company, including the plan of any entity acquired by the Company. The
Company's non-employee directors are only eligible for the awards described in
Section 4(b) subject to the grant schedule described in Section 4(e). The types
of awards that may be granted under the Plan include:
b) Stock Option. A stock option represents a right to purchase a specified
number of shares of Stock during a specified period at a price per share which
is no less than 100% of the per share amount stipulated by Section 2(c). The
longest term during which a stock option may be outstanding shall be ten years.
A stock option may be in the form of an incentive stock option as defined in
Section 422 of the IRC or in another form which may or may not qualify for
favorable federal income tax treatment. The Stock covered by a stock option may
be purchased by means of a cash payment or such other means as the Committee may
from time-to-time permit, including (i) tendering (either actually or by
attestation) shares of Stock valued using the market price at the time of
exercise, (ii) authorizing a third party to sell Stock (or a sufficient portion
thereof) acquired upon exercise of a stock option and to remit to the Company a
sufficient portion of the sale proceeds to pay for all the shares of Stock
acquired through such exercise and any tax withholding obligations resulting
from such exercise; or (iii) any combination of the above.
c) Stock Appreciation Right. A stock appreciation right is a right to
receive a payment in cash, Stock or a combination, equal to the excess of the
aggregate market price at time of exercise of a specified number of shares of
Stock over the aggregate
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exercise price of the stock appreciation right being exercised. The longest term
a stock appreciation right may be outstanding shall be ten years. Such exercise
price shall be based on 100% of the per share amount stipulated by Section 2(c).
d) Stock Award. A stock award is a grant of Stock or of a right to receive
Stock (or their cash equivalent or a combination of both) in the future. Except
in cases of certain terminations of employment or an extraordinary event, each
Stock award shall be earned and vest over at least one year and shall be
governed by such conditions, restrictions and contingencies as the Committee
shall determine. These may include continuous service and/or the achievement of
performance goals.
The performance goals that may be used by the Committee for such awards to
executive officers covered by IRC Section 162(m) shall consist of:
<TABLE>
<S> <C>
Revenue Return on Equity
Net Income Stockholder Return
Earnings Per Share
</TABLE>
Further, performance criteria may reflect absolute entity performance or a
relative comparison of entity performance to the performance of a peer group of
entities or other external measure of the selected performance criteria. Profit,
earnings and revenues used for any performance goal measurement shall exclude:
gains or losses on operating asset sales or dispositions; asset write-downs;
litigation or claim judgments or settlements; accruals for historic
environmental obligations; effect of changes in tax law or rate on deferred tax
liabilities; accruals for reorganization and restructuring programs; uninsured
catastrophic property losses; the cumulative effect of changes in accounting
principles; and any extraordinary non-recurring items as described in Accounting
Principles Board Opinion No. 30 and/or in management's discussion and analysis
of financial condition and results of operation appearing in the Company's
annual report to stockholders for the applicable year.
e) Directors Stock Options. Non-employee directors shall receive award of
stock options which are not intended to be treated as incentive stock options
under Section 422 of the IRC. These awards shall consist of one grant of 50,000
shares of Stock upon appointment to the Board and subsequent annual grants of
10,000 shares of Stock on the first business day of each calendar year at an
exercise price equal to the closing price of the Stock on the last business day
of the prior year. Each option granted under this (e) shall be immediately
exercisable.
4. AWARD SETTLEMENTS AND PAYMENTS
a) Dividends and Dividend Equivalents. An award may contain the right to
receive dividends or dividend equivalent payments which may be paid either
currently or credited to a participant's account. Any such crediting of
dividends or dividend equivalents or reinvestment in shares of Stock may be
subject to such conditions, restrictions and contingencies as the Committee
shall establish, including the reinvestment of such credited amounts in share
equivalents.
b) Payments. Awards may be settled through cash payments, the delivery of
Stock, the granting of awards or combination thereof as the Committee shall
determine. Any award settlement, including payment deferrals, may be subject to
such conditions, restrictions and contingencies, as the Committee shall
determine. The Committee may
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permit or require the deferral of any award payment, subject to such rules and
procedures as it may establish, which may include provisions for the payment or
crediting of interest, or dividend equivalents, including converting such
credits into deferred share equivalents. Subject to the aggregate limitation on
the number of shares of Stock that may be issued under the Plan as set forth in
Section 3(a), the Committee may, in addition to granting awards under Section 4,
use available Stock as the form of payment for other compensation plans or
arrangements of the Company, including those of any entity acquired by the
Company.
5. PLAN AMENDMENT AND TERMINATION
a) Amendments. The Board may amend this Plan as it deems necessary and
appropriate to better achieve the Plan's purpose provided, however, that: (i)
the share limitations set forth in Sections 3(a) and 3(b) cannot be increased
and (ii) the minimum stock option and stock appreciation right exercise prices
set forth in Sections 2(c) and 4(b) and (c) cannot be changed unless such a Plan
amendment is properly approved by the Company's stockholders.
b) Plan Suspension and Termination. The Board may suspend or terminate
this Plan at any time. Any such suspension or termination shall not of itself
impair any outstanding award granted under the Plan or the applicable
participant's rights regarding such award.
6. MISCELLANEOUS
(a) No Individual Rights. No person shall have any claim or right to be
granted an award under the Plan. Neither the Plan nor any action taken hereunder
shall be construed as giving any employee or other person any right to continue
to be employed by or to perform services for the Company, any subsidiary or
related entity. The right to terminate the employment of or performance of
services by any Plan participant at any time and for any reason is specifically
reserved to the employing entity.
b) Unfunded Plan. The Plan shall be unfunded and shall not create (or be
construed to create) a trust or a separate fund or funds. The Plan shall not
establish any fiduciary relationship between the Company and any participant or
beneficiary of a participant. To the extent any person holds any obligation of
the Company by virtue of an award granted under the Plan, such obligation shall
merely constitute a general unsecured liability of the Company and accordingly
shall not confer upon such person any right, title or interest in any assets of
the Company.
c) Other Benefit and Compensation Programs. Unless otherwise specifically
determined by the Committee, settlements of awards received by participants
under the Plan shall not be deemed a part of a participant's regular, recurring
compensation for purposes of calculating payments or benefits from any Company
benefit plan or severance program. Further, the Company may adopt other
compensation programs, plans or arrangements as it deems appropriate.
d) No Fractional Shares of Stock. No fractional shares of Stock shall be
issued or delivered pursuant to the Plan or any award, and the Committee shall
determine whether cash shall be paid or transferred in lieu of any fractional
shares of Stock, or whether such fractional shares of Stock or any rights
thereto shall be canceled.
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e) Governing Law. The validity, construction and effect of the Plan and
any award, agreement or other instrument issued under it shall be determined in
accordance with the laws of the state of Delaware without reference to
principles of conflict of law.
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AMENDMENT TO
REPUBLIC SERVICES, INC.
1998 STOCK INCENTIVE PLAN
WHEREAS, Republic Services, Inc. (the "Company") adopted the Republic
Services, Inc. 1998 Stock Incentive Plan (the "Plan"), effective July 1, 1998;
and
WHEREAS, the Plan provides that the Board of Directors may amend the Plan
at any time; and
WHEREAS, the Board of Directors desires to amend the Plan so that the Plan
terminates July 1, 2008.
NOW THEREFORE, BE IT RESOLVED, that Section 6(b) of the plan is amended by
deleting the text therein and inserting the following text:
b) Plan Suspension and Termination. The Board may suspend or
terminate this Plan at any time. If the Board has not yet
terminated the Plan under this Section 6(b), the Plan shall
terminate on July 1, 2008. Any such suspension or termination shall
not itself impair any outstanding award granted under the Plan or
the applicable participant's rights regarding such award.
IN WITNESS WHEREOF, this Amendment is executed this 22nd day of March,
2000.
REPUBLIC SERVICES, INC.
By: /s/ DAVID A. BARCLAY
--------------------------------
Title: Senior Vice President,
General Counsel and
Assistant Secretary
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[RECYCLING LOGO]
<PAGE> 33
APPENDIX B
PROXY
REPUBLIC SERVICES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
James E. O'Connor and David A. Barclay, each with power of substitution, are
hereby authorized to vote all shares of common stock which the undersigned would
be entitled to vote if personally present at the annual meeting of stockholders
of Republic Services, Inc. to be held on May 9, 2000, or any postponements or
adjournments of the meeting, as indicated hereon.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY
THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED
FOR THE ELECTION OF ALL NOMINEES AND FOR PROPOSALS 2 AND 3 SET FORTH ON THE
OTHER SIDE. As to any other matter, said proxies shall vote in accordance with
their best judgment.
The undersigned hereby acknowledges receipt of the notice of the 2000 annual
meeting of stockholders, the proxy statement and the annual report for the
fiscal year ended December 31, 1999 furnished with this proxy.
<TABLE>
<S> <C> <C> <C>
1. Election of [ ] FOR all nominees listed [ ] WITHHOLD AUTHORITY to vote for [ ] *EXCEPTIONS (FOR all
directors: below all nominees listed below nominees except as indicated in
space below)
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES. The Nominees: H.
Wayne Huizenga, Harris W. Hudson, James E. O'Connor, John W. Croghan, Ramon A.
Rodriguez and Allan C. Sorensen.
* INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark
the "Exceptions" box above and write that nominee's name in the
space provided below.
Exceptions
- --------------------------------------------------------------------------------
(Continued and to be signed on reverse side)
<PAGE> 34
<TABLE>
<S> <C>
2. Approval and adoption of our 1998 Stock Incentive 4. In their discretion, on such other matters as may
Plan in order to qualify grants under the plan as properly come before the meeting.
performance-based compensation:
[ ] Change of Address and/or Comments Mark Here:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR
APPROVAL AND ADOPTION OF THE 1998 STOCK INCENTIVE PLAN.
3. Ratification of the appointment of Arthur Andersen ----------------------------------------------------
LLP as independent public accountants for 2000: ----------------------------------------------------
----------------------------------------------------
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN
LLP.
</TABLE>
<TABLE>
<S> <C>
Please sign exactly as name appears hereon.
When shares are held by joint tenants, both
should sign. If acting as attorney, executor,
trustee, or in any representative capacity,
sign name and title.
Dated -----------------------------------,
2000
---------------------------------------------
Signature
---------------------------------------------
Signature if held jointly
Votes must be indicated with [X] in black or
blue ink.
</TABLE>
PLEASE MARK, SIGN, DATE AND PROMPTLY RETURN THIS PROXY CARD USING THE ENCLOSED
ENVELOPE.
