EXHIBIT 10.24
CHANGE IN CONTROL
AGREEMENT
THIS AGREEMENT between Waste
Industries USA, Inc., a North Carolina corporation (the “
Company ”), and Harrell J. (“Jim”) Auten,
III (the “ Employee ”), is made as of this 15th
day of January, 2007.
RECITALS
A. The Employee is employed as the
Vice President, Sales and Marketing of the Company, which is a
position of significant importance with the Company.
B . The Company believes
that, in the event it is confronted with a situation that could
result in a Change of Control (as defined below), continuity of
management at the Company will be essential to the Company’s
continued successful operations.
C. The Company understands that any
such situation will present significant concerns for the Employee
with respect to his financial and job security.
D. The Company desires to assure
itself of the Employee’s services during the period in which
it is confronting such a situation, and to provide the Employee
certain financial assurances to enable the Employee to perform the
responsibilities of his position without undue distraction and to
exercise his judgment without bias due to his personal
circumstances.
E. To achieve these objectives, the
Company and the Employee desire to enter into an agreement
providing the Company and the Employee with certain rights and
obligations upon the occurrence of a Change of Control.
AGREEMENTS
NOW, THEREFORE, in consideration of
the recitals and mutual covenants herein contained, it is hereby
agreed by and between the Company and the Employee as
follows:
1. Operation of Agreement
.
(a) Effective Date . The
effective date of this Agreement shall be the date on which a
Change of Control occurs (the “ Change of Control Date
”), provided that , if the Employee is not
employed by the Company for any or no reason on the Change of
Control Date, this Agreement shall be void and without
effect.
(b) Employment Protection
Benefits . If, on or before the second anniversary of the
Change of Control Date, (x) the Company terminates the
Employee’s employment other than for death, for Disability
(as defined below) or for Cause (as defined below) or (y) the
Employee terminates his employment for Good Reason (as defined
below), or such termination for any reason other than death,
Disability or for Cause occurs in contemplation of a Change of
Control which Change of Control does in fact occur (such
termination within ninety (90) days prior to the Change of
Control Date being presumed to be in contemplation of a Change
of
Control unless rebutted by evidence to the
contrary). Upon Employee’s execution of a general release of
claims in a form satisfactory to the Company, the Company shall pay
to the Employee an amount (the “ Severance Amount
”) equal to the sum of (i) the Employee’s annual
base salary, as then in effect prior to any reduction therein with
respect to taxes, employee benefit plans or other mandatory or
elective withholdings therefrom (the “ Base Salary
”), and (ii) the average of the annual bonuses paid to
the Employee for each of the last two (2) fiscal years of the
Company ending prior to the Change of Control Date, subject to
Employee’s compliance with the restrictive provisions set
forth in Sections 1(c) and 1(d) hereof. Such Severance Payments
shall be paid in equal installments on the Company’s
regularly scheduled paydays, net of any federal, state and local
payroll taxes and other withholdings legally required or properly
requested by Employee, in accordance with the Company’s
regular payroll practices and procedures.
(c) Noncompetition Covenant .
In the event that Employee is entitled to receive the Severance
Amount provided in Section 1(b), Employee promises and agrees
that for the duration of the twelve-month period in which Employee
is receiving such Severance Payments, he will not, either directly
or indirectly, as an officer, director, partner, member, employee,
associate, principal, agent, representative or consultant, for
himself or on behalf of any other individual, partnership, firm,
corporation or other entity:
(i) Engage in, own any interest in
(other than less than five percent (5%) of the outstanding
shares of any publicly-traded corporation), manage, operate or
control, any business that is engaged in the provision or sale of
solid waste collection and removal services, solid waste
transportation services, solid waste recycling services, and/or the
ownership and/or operation of landfills (the “ Covered
Services ”) within the “Restricted Area” (as
defined below); or
(ii) Be employed in, engage in, or
render services competing with, the Covered Services within the
Restricted Area.
(d) Nonsolicitation Covenant
. In the event that Employee is entitled to receive the Severance
Amount provided in Section 1(b), Employee promises and agrees
that for the duration of the twelve-month period in which Employee
is receiving such Severance Payments, he will not, either directly
or indirectly, for himself or on behalf of any other individual,
partnership, firm, corporation or other entity:
(i) Influence or attempt to
influence any of the customers with whom Employee had contact
within his last twelve (12) months of employment on behalf of
the Company, its subsidiaries, or affiliates, to divert its
purchases of any of the Covered Services to any other individual,
partnership, firm, corporation or other entity; or
(ii) Solicit any of the employees or
sales representatives of the Company or of any of its subsidiaries
or affiliates to work for any business, individual, partnership,
firm, corporation or other entity then rendering Covered
Services.
(e) For purposes of this Agreement,
the “Restricted Area” shall mean the area within a one
hundred (100) mile radius of each place of business of the
Company including, without limitation, the Company’s home
office, division offices, local and branch offices, landfills,
transfer stations and recycling centers.
(f) Employee acknowledges that the
Company is doing business throughout the Restricted Area, and
recognizes that the time limits, geographic scope, and the types
and limitations of activities set forth herein above are reasonable
and necessary to protect the legitimate interests of the Company.
It is the desire and intent of the parties that the provisions of
this Section 1 shall be enforced to the fullest extent
permitted under the laws and public policies of each jurisdiction
in which enforcement is sought. If any court determines that any
provision of this Section 1 is unenforceable because of the
duration or geographic scope of such provision, such court shall
have the power to reduce the duration or scope of such provision,
as the case may be, and, in its reduced form, such provision shall
then be enforceable.
(g) Notwithstanding the employment
protection provisions of this Agreement, Employee’s
employment is and shall continue to be “at will.”
Employee’s employment may be terminated at any time by either
party, for any or no cause or reason, subject to the terms of this
Agreement.
(h) Accelerated Vesting of
Options . All options to purchase the Company’s
securities granted to and then held by Employee shall automatically
vest in full upon a Change of Control; provided ,
further , that in the event the Employee’s employment
is terminated prior to the Change of Control Date under
circumstances which ultimately give rise to Employee’s right
hereunder to receive the Severance Amount, then notwithstanding
such termination, all of the Employee’s options held on such
termination date will accelerate and vest on the Change of Control
Date and shall remain exercisable for ninety (90) days
thereafter.
2. Definitions .
(a) Change of Control . For
the purposes of this Agreement, a “Change of Control”
shall mean (i) a “person” (as such term is used in
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934,
as amended), other than a majority owned subsidiary of the Company,
any of the then current shareholders, any members of the immediate
family of any of the then current shareholders, any entity which
holds any of the Company’s securities for the benefit of any
of the then current shareholders or members of any such
shareholder’s immediate family, or any other business entity
which is owned or controlled by one or more of the then current
shareholders (the “ Excluded Holders ”), becomes
the beneficial owner, directly or indirectly, of securities of the
Company representing more than fifty percent
(50%) of
