EXHIBIT 10.4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made and entered into as of the 23rd day
of February, 2000, by and between XXXXXX X. XXXXXXX ("Employee") and ALLIED
HOLDINGS, INC., a Georgia corporation ("Employer").
WITNESSETH
WHEREAS, Employer, through the Affiliates (as hereinafter defined), is
engaged in the transportation of automobiles and light trucks from the
manufacturer to retailers and related activities (the "Business");
WHEREAS, Employee has a number of years of experience in said industry
and in addition to having management skills of which Employer desires to avail
itself, Employee has established numerous contacts and relationships with
customers, potential customers and suppliers of Employer and the Affiliates,
which contacts and relationships are of great value to Employer;
WHEREAS, Employer and Employee have made and entered into a previous
employment agreement, as well as clarifications and amendments thereto; and
WHEREAS, Employer and Employee deem it to their respective best
interest to clarify the duties and obligations, each to the other, by executing
this new Employment Agreement,
NOW, THEREFORE, for and in consideration of the covenants and
conditions hereinafter set forth, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Employer and
Employee hereby mutually agree that all previous employment agreements, and all
clarifications and amendments thereto, are superseded, null, void, and of no
further force and effect, and Employer and Employee further mutually agree as
follows:
1. DEFINITIONS.
(a) "Affiliate" means any corporation, partnership or
other entity of which at least eighty percent (80%)
of the outstanding equity and voting rights are
owned, directly or indirectly through any other
corporation, partnership or other entity, by
Employer.
(b) "Base Salary" means the annual salary payable
pursuant to Paragraph 4(a) hereof as adjusted, from
time to time, pursuant to Paragraph 4(b) hereof.
(c) "Cause" means (i) the commission by Employee of an
act constituting a felony and Employee's conviction
thereof; (ii) Employee's prolonged absence, without
the consent of Employer, other than as a result of
Employee's Disability or permitted absence or
vacation; (iii) conduct of Employee which amounts to
fraud, dishonesty, gross or willful neglect of
duties; or (iv) engaging in activities prohibited by
Paragraphs 12, 13 or 14 hereof.
(d) "Disability", with respect to Employee, shall
conclusively be deemed to have occurred (i) if
Employee shall be receiving payments pursuant to a
policy of disability income insurance; or (ii) if
Employee shall have no disability income coverage
then in force, then if any insurance company
insuring Employee's life shall agree to waive the
premiums due on such policy pursuant to a disability
waiver of premium provision in the contract of life
insurance; or (iii) if Employee shall have no
disability waiver of premium provision in any
contract of life insurance, then if Employee shall
be receiving disability benefits from or through the
Social Security Administration; provided, however,
that in the event Employee's disability shall,
otherwise and in good faith, come into question
(and, for purposes of this proviso, "disability"
shall mean the permanent and continuous inability of
Employee to perform substantially all of the duties
being performed immediately prior to his disability
coming into question), and a dispute shall arise
with respect thereto, then Employee (or his personal
representatives) shall appoint a medical doctor,
Employer shall appoint a medical doctor, and said
two (2) doctors shall, in turn, appoint a third
party medical doctor who shall examine Employee to
determine the question of disability and whose
determination shall be binding upon all parties to
this Agreement.
(e) "Restricted Period" means the period commencing as
of the date hereof and ending on that date three (3)
years after the termination of Employee's employment
with Employer for any reason, whether voluntary or
involuntary.
(f) "Term" means the Initial Term and any Renewal Term
(each as defined in Paragraph 2 hereof); provided,
however, that, in the event Employee's employment
shall terminate by reason of the applicability of
Paragraph 8 hereof then, in such event, the "Term"
shall end upon the termination of Employee's
employment.
2. TERM. Subject to the provisions hereinafter set forth, the
Term of this Agreement shall commence as of the date hereof and shall end on
that date five (5) years after such date (the "Initial Term"). Upon the
expiration of the Initial Term, and on the expiration of each successive
Renewal Term (as hereinafter defined), Employee's
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employment shall be automatically renewed for an additional term of two (2)
years (the "Renewal Term(s)"), unless written notification of termination is
given by either party to the other party not less than one (1) year prior to
the expiration of the Initial Term or, as the case may be, the then-current
Renewal Term.
3. DUTIES.
(a) Employee shall, during the Term, serve as Chairman
of the Board of Employer, at the direction of the
Board of Directors of Employer. Employee's principal
duties shall be such executive, managerial and
administrative duties as the Board of Directors of
Employer may, from time to time, reasonably request.
(b) During the Term, Employee shall devote substantially
all of his time, energy and skill to performing the
duties of his employment (vacations as provided
hereunder and reasonable absences because of illness
excepted), shall faithfully and industriously
perform such duties, and shall use his best efforts
to follow and implement all management policies and
decisions of Employer. Employee shall not become
personally involved in the management or operations
of any other company, partnership, proprietorship or
other entity, other than any Affiliate, without the
prior written consent of Employer; provided,
however, that so long as it does not interfere with
Employee's employment hereunder, Employee may (i)
serve as a director, officer or partner in a company
that does not compete with the Business of Employer
and the Affiliates so long as the aggregate amount
of time spent by Employee in all such capacities
shall not exceed twenty (20) hours per month, and
(ii) serve as an officer or director of, or
otherwise participate in, educational, welfare,
social, religious, civic, trade and industry-related
organizations.
(c) Employee shall not be required to relocate outside
of the metropolitan Atlanta, Georgia, area.
4. BASE SALARY.
(a) For and in consideration of the services to be
rendered by Employee pursuant to this Agreement,
Employer shall pay to Employee, for each year during
the Term, an annual salary of Four Hundred Thousand
Dollars ($400,000.00), adjusted as provided in
subparagraph (b) below, in equal semi-monthly
installments in accordance with Employer's payroll
practices. Employee's salary shall be reviewed by
the Board of Directors of Employer annually (on each
anniversary of the date hereof) and, in the sole
discretion of the Board of Directors, may be
increased, but not decreased.
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(b) Commencing as of January 1, 2001, and as of each
January 1st thereafter during the Term, the annual
salary shall be increased, but not decreased, by an
amount equal to the greater of (i) such amount as
shall be determined by the Compensation Committee of
the Board of Directors of Employer; or (ii) the
amount equal to the percentage, if any, by which the
Consumer Price Index (All Items Less Shelter), Urban
Wage Earners and Clerical Workers, for the Southeast
Region/Population Size Class B, published by the
United States Government Bureau of Labor Statistics
for the December 1 preceding such January exceeds
such Index for the December 1 of the preceding year.
(As an example, as of January 1, 2001, the
difference will be between said Index as of December
1, 2000 compared to said Index as of December 1,
1999.)
5. BONUS COMPENSATION. Employee shall, with respect to each
calendar year of Employer ending during the Term, be entitled to participate in
the Allied Holdings, Inc. EVA Based Incentive Plan (as from time to time
amended and in effect), to the extent and on such terms and conditions as shall
from time to time be determined by the Board of Directors of Allied Holdings,
Inc.; and to receive an annual bonus, if any, calculated pursuant thereto.
6. OTHER BENEFITS. During the Term, Employer shall provide the
following benefits to Employee:
(a) Employee shall be elected to a seat on the Board of
Directors of Employer but shall not, however, be
entitled to any additional compensation for such
service;
(b) Employee shall be entitled to participate in all
group medical and hospitalization benefit programs,
dental care, sick leave, life insurance or other
benefit plans for highly compensated employees of
Employer as are now or hereafter provided by
Employer or any Affiliate, in each case in
accordance with the terms and conditions of each
such plan and benefit package;
(c) Employee shall be provided with the use of
automobiles at least comparable to any automobile
currently provided to Employee, and Employer shall
pay for the cost of all insurance, ad valorem taxes
and tag charges for such automobile and all
operating and maintenance charges for such
automobile;
(d) Employee shall be provided with the use of a car or
mobile telephone, at no cost to Employee;
(e) Employer shall reimburse Employee for dues paid by
Employee for membership in such professional
organizations and eating clubs as
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shall, from time to time, be deemed appropriate and
necessary by Employee; and
(f) Employee shall, at all times, have available to him
an expense account to defray ordinary and necessary
business expenses incurred in the performance of his
duties hereunder. Employee shall be reimbursed for
such expenses upon presentation and approval of
expense statements or written vouchers or other
supporting documents as may be reasonably requested
in advance by Employer, which approval shall not be
unreasonably withheld or delayed.
The benefits described in subparagraph (b) of this Paragraph shall not
be construed to require Employer to establish any such plans or programs or to
prevent Employer from modifying or terminating any such plans or programs, and
no such action or failure thereof shall affect this Agreement; provided,
however, that in the event of any reduction in the group medical and
hospitalization benefits in place as of the date hereof, the salary payable to
Employee shall be increased, as of the effective date of such reduction, by
that amount necessary to enable Employee to supplement the benefits provided by
Employer to maintain the level of benefits currently provided to him by it.
7. VACATION. Employee shall receive five (5) weeks of paid
vacation for each year during the Term. Scheduling of vacation shall be subject
to the prior approval of Employer (which approval shall not be unreasonably
withheld). Vacation time shall not accrue, and in the event any vacation time
for any year shall not be used by Employee prior to the end of such year, it
shall be forfeited.
8. TERMINATION. Anything herein to the contrary notwithstanding,
Employee's employment hereunder shall terminate upon the first to occur of any
of the following events:
(a) Employee's Disability; or
(b) Employee's death; or
(c) Employee's materially breaching this Agreement by
the non-performance or non-observance of any
material term or condition of this Agreement, which
breach shall not be corrected within forty-five (45)
days after receipt of written notice of same from
Employer; or
(d) Employer's sending Employee written notice
terminating his employment hereunder prior to
expiration of the Term in accordance with Paragraph
2 hereof; or
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(e) Employee's voluntarily terminating his employment
with Employer prior to the expiration of the Term;
or
(f) Employee's being terminated for Cause.
9. TERMINATION PAYMENT. In the event
(a) Employee's employment shall terminate pursuant to
Paragraph 8(a) (Disability) or Paragraph 8(b)
(death) hereof; or
(b) Employee shall terminate his employment as a result
of
(i) any failure to elect or reelect or to
appoint or reappoint Employee to the
position of Chairman of the Board of
Directors of Employer unless agreed to by
Employee;
(ii) any material change by Employer in
Employee's function, duties,
responsibility, importance, or scope from
the position and attributes thereof
described in Paragraph 3 hereof unless
agreed to by Employee, or any change in
location of the principal offices of
Employer outside the metropolitan Atlanta,
Georgia, area, or any requirement that
Employee perform substantially all of his
duties outside the metropolitan Atlanta,
Georgia, area (and any such material change
or relocation of Employer or Employee shall
be deemed a continuing breach of this
Agreement);
(iii) the liquidation, dissolution, consolidation
or merger of Employer (other than a merger
or other combination of Employer and an
Affiliate); however, if a termination of
employment results from events described in
this subsection (iii) and in subsection (d)
below, then such termination shall be
deemed to be pursuant to subsection (d)
below;
(iv) any other material breach of this Agreement
by Employer which shall not be cured within
thirty (30) days after receipt of written
notice of same from Employee;
(v) Employer filing a petition for protection
or relief from creditors under the federal
bankruptcy law, or any petition shall be
filed against Employer under the federal
bankruptcy law, or Employer shall admit in
writing its inability to pay its debts or
shall make an assignment for the benefit of
creditors, or a petition or application for
the appointment of a receiver or liquidator
or custodian of Employer is filed, or
Employer shall seek a composition with
creditors; or
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(c) Employee's employment shall be terminated by
Employer for any reason other than for Cause or
because Employer elects not to extend this Agreement
beyond the Initial or any Renewal Term; or
(d) If (i) Employer undergoes any change in control or
ownership whereby Employer is reorganized, merged,
or consolidated with one or more corporations as a
result of which the owners of all of the outstanding
shares of common stock immediately prior to such
reorganization, merger or consolidation own in the
aggregate less than seventy percent (70%) of the
outstanding shares of common stock of the Employer
or any other entity into which Employer shall be
merged or consolidated immediately following the
consummation thereof (hereinafter, "Employer's
successor-in-interest"), or (ii) the sale, transfer
or other disposition of all or substantially all of
the assets or more than thirty percent (30%) of the
then outstanding shares of common stock of Employer
is effectuated, other than as a result of a merger
or other combination of Employer and an Affiliate,
or (iii) the acquisition by any "person" as used for
purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934 of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the
Exchange Act) of twenty percent (20%) or more of the
combined voting power of Employer's then outstanding
voting securities is effectuated; or (iv) the
individuals who, as of the date of execution of this
Agreement, are members of the Board of Directors
(the "incumbent Board") cease for any reason to
constitute at least two-thirds (2/3) of the Board;
provided, however, that if the election, or
nomination for election by the shareholders of any
new director was approved by a vote of at least
two-thirds (2/3) of the incumbent Board, such new
director shall, for purposes of this Agreement, be
considered as a member of the incumbent Board, and
(a) Employee's employment with Employer or
Employer's successor-in-interest is terminated by
Employer or Employer's successor-in-interest (as the
case may be) or Employee for any reason, or (b)
Employee's employment under this Agreement is not
extended by Employer or Employer's
successor-in-interest for any Renewal Term, and such
termination or non-renewal occurs within two (2)
years after the closing of the transaction which
resulted in the change in control,
then Employer shall, depending upon the reason for the termination of
Employee's employment, immediately pay in cash to Employee an amount determined
as follows:
(x) If the termination shall be pursuant to subparagraph (d)
above, the amount shall be equal to the sum of
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(1) three hundred percent (300%) of Employee's
then-effective annual Base Salary; and
(2) three hundred percent (300%) of the Bonus, as
hereinafter defined.
In addition, Employer shall continue to provide to Employee
(except in the case of Employee's death), for a period equal
to the greater of (i) the remainder of the Term had not said
termination occurred, and (ii) three (3) years from said
termination, the benefits enumerated in Paragraphs 6(b) and
6(c) hereof.
(y) If the termination shall be other than pursuant to
subparagraph (d) above, the amount shall be equal to the sum
of
(1) that percentage of Employee's then-effective annual
Base Salary equal to the product of the number of
whole or partial years remaining in the Term and one
hundred (100); and
(2) that percentage of Employee's then-effective Bonus,
as hereinafter defined, equal to the product of the
number of whole or partial years remaining in the
Term and one hundred (100);
provided, however, in no event shall the percentage in
subparagraphs (1) and (2) hereof be less than three hundred
percent (300%).
In addition, Employer shall continue to provide to Employee
(except in the case of Employee's death), for a period of
years equal to the number of whole or partial years remaining
in the Term, but in no event fewer than three (3) years, the
benefits enumerated in Paragraphs 6(b) and 6(c) hereof.
10. OPERATIVE PROVISIONS.
(a) As used in this Agreement, the term "Bonus" shall
mean:
(i) with respect to the most recent grant or
award of restricted stock, pursuant to
Employer's "Long Term Incentive Plan", made
prior to the date of termination of
Employee's employment, the Dollar value, as
of the date of such grant or award, of the
Long Term Incentive Plan restricted stock
plan target for Employee as approved by the
Compensation Committee of Employer's Board
of Directors, which Dollar value is
established by the Compensation Committee
notwithstanding the number of shares
actually received pursuant to such grant or
award and notwithstanding the value of such
shares actually received; plus
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(ii) the highest of (1) the average of the EVA
bonuses actually paid to Employee for the
two (2) years immediately preceding the
year in which termination of employment
occurs; (2) the average of the EVA bonuses
which would have been paid to Employee for
the two (2) years immediately preceding the
year in which termination of employment
occurs, assuming his EVA target bonus had
been achieved for each such year; or (3)
the amount of the EVA target bonus for
Employee for the year in which termination
of employment occurs.
(b) In the event of a termination of employment pursuant
to Paragraph 9 hereof, all restricted stock awards
of Employee shall become wholly unrestricted and all
unvested stock options of Employee shall become
fully vested in Employee, and all such agreements
pertaining thereto shall be read accordingly;
provided, however, that Employee shall not have any
such rights with respect to any stock issued under
any employee stock plan of Employer qualifying under
Section 402(a) et seq. of the Code if, and to the
extent, such rights would jeopardize the
qualification of such plan under said Section. As
used in the preceding sentence, "Code" means the
Internal Revenue Code of 1986 as amended from time to
time or any provisions from time to time enacted and
corresponding in substance thereto.
(c) Paragraph 9 and this Paragraph 10 shall survive the
termination of this Agreement, and this Agreement
shall be read accordingly.
11. INTENTION OF PARTIES. It is the express understanding and
intention of Employer and Employee that the provisions of Paragraph 5 and
Paragraph 9 hereof shall be read together and be non-exclusive so that, in the
event of a termination of Employee's employment pursuant to Paragraph 9 of this
Employment Agreement, Employee shall receive both (i) all of the compensation
specified in Paragraph 9 hereof (including, but not limited to, the applicable
percentage of Employee's then-effective Base Salary and the applicable
percentage of the cash portion of Employee's Bonus) and (ii) one hundred
percent (100%) of the pro rata portion of both the cash and equity parts of
Employee's Bonus based on the number of days in the fiscal year falling within
the Term (which shall include the amount of any EVA bonus paid to Employee
during that year, if any), but in no event shall such pro rata portion be less
than the pro rata share of the highest of (i) the average of the EVA bonuses
actually paid to Employee for the two (2) years immediately preceding the year
in which termination of employment occurs; (ii) the average of the EVA bonuses
which would have been paid to Employee for the two (2) years immediately
preceding the year in which termination of employment occurs, assuming his EVA
target bonus had been achieved for each such year; or (iii) the amount of the
EVA target bonus for Employee for the year in which
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termination of employment occurs. The amounts referred to in this Paragraph are
in addition to the benefits enumerated in Paragraphs 6(b) and 6(c) hereof.
12. COVENANT NOT-TO-SOLICIT. Employer and Employee acknowledge
that, during Employee's employment, Employer will spend considerable amounts of
time, effort and resources in providing Employee with knowledge relating to the
business affairs of Employer and the Affiliates, including Employer's and the
Affiliates' trade secrets, proprietary information and other information
concerning Employer's and the Affiliates' financing sources, finances, customer
lists, customer records, prospective customers, staff, contemplated
acquisitions (whether of business or assets), ideas, methods, marketing
investigations, surveys, research, customers' records and any other information
relating to Employer's and the Affiliates' Business.
Employer and Employee recognize that, during the course of Employee's
term of employment with Employer pursuant to this Agreement, Employee shall
contact, solicit or approach Employer's and the Affiliates' customers and
prospective customers on behalf of Employer. Employer and Employee further
acknowledge that Employee has and shall, during his term of employment with
Employer, solicit business for Employer and the Affiliates from the customers
listed on EXHIBIT A attached hereto and made a part hereof (collectively, the
"Restricted Customers").
To protect Employer from Employee's solicitation of business from such
customers during the Restricted Period, Employee agrees that, subject to
Paragraph 15 hereof, he shall not, directly or indirectly, for any person
(including Employee himself), corporation, firm, partnership, proprietorship or
other entity, other than Employer or an Affiliate, engaged in the
transportation of automobiles and light trucks from manufacturers to retailers,
solicit business from any Restricted Customer. This Paragraph 12 shall, except
as otherwise provided in this Agreement, survive the termination of this
Agreement.
13. COVENANT NOT-TO-DISCLOSE. Employer and Employee recognize
that, during the course of Employee's term of employment with Employer pursuant
to this Agreement, Employer will disclose to Employee information concerning
Employer and the Affiliates, their products, their customers, their services,
their trade secrets, their proprietary information and other information
concerning their business all of which constitute valuable assets of Employer
and the Affiliates. Employer and Employee further acknowledge that Employer
has, and will, invest considerable amounts of time, effort and corporate
resources in developing such valuable assets and that disclosure by Employee of
such assets to the public shall cause irreparable harm, damage and loss to
Employer and the Affiliates.
(a) To protect these assets, Employee agrees that he
shall not, during the Restricted Period, advise or
disclose to any person, corporation, firm,
partnership or other entity whatsoever (except
Employer or an Affiliate), or any officer, director,
stockholder, partner or associate of any such
corporation, firm, partnership or
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entity any information received from Employer by
Employee during the course of Employee's association
with Employer relating to the business affairs of
Employer and the Affiliates including information
concerning Employer's and the Affiliates' finances,
services, customers, customer lists, prospective
customers, staff, contemplated acquisitions (whether
of business or assets), ideas, proprietary
information, methods, marketing investigations,
surveys, research and any other information relating
to the business and objectives of Employer and the
Affiliates, except as permitted by this Paragraph
13.
(b) Employee further agrees that he shall not, during
the term of his employment or any time thereafter,
advise or disclose to any person or entity any trade
secret which Employer or any Affiliate has disclosed
to Employee during the course of his employment with
Employer.
(c) In the event Employee's employment is terminated,
Employee agrees that, if requested by Employer, he
will acknowledge in writing that he received the
disclosures referred to herein and is under the
obligations referred to in this Agreement.
(d) This Paragraph 13 shall, except as otherwise
provided in this Agreement, survive the termination
of this Agreement.
Any implication in this Paragraph 13 to the contrary notwithstanding,
this Paragraph 13 shall not, and shall not be deemed to, prohibit Employee from
disclosing information regarding Employer that (i) is already public
information other than because of any breach of this Paragraph 13 by Employee;
(ii) shall be required by applicable Federal or state laws; (iii) shall not be
confidential or proprietary and shall be required in the ordinary course of
business; and (iv) shall be required pursuant to the order of any court or
administrative agency having jurisdiction; provided, however, that the
foregoing shall not permit the disclosure of any trade secret of Employer.
14. COVENANT NOT-TO-INDUCE. Employee covenants and agrees that
during the Restricted Period, he will not, directly or indirectly, on his own
behalf or in the service or on behalf of others, hire, solicit, take away or
attempt to hire, solicit or take away an employee or other personnel of
Employer and the Affiliates. This Paragraph 14 shall, except as otherwise
provided in this Agreement, survive the termination of this Agreement.
15. PARAMOUNT PROVISION. Anything in this Agreement to the
contrary notwithstanding, the provisions of Paragraph 12 and Paragraphs 13(a)
and 13(c) hereof shall not apply to Employee, and shall be absolutely null and
void, in the event Employee shall terminate his employment hereunder for any
one of the reasons set forth in Paragraph 9(b) hereof.
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16. SPECIFIC ENFORCEMENT. Employer and Employee expressly agree
that a violation of the covenants not-to-solicit, not-to-disclose and
not-to-induce contained in Paragraphs 12, 13 and 14 hereof, or any provision
thereof, shall cause irreparable injury to Employer and that, accordingly,
Employer shall be entitled, in addition to any other rights and remedies it may
have at law or in equity, to an injunction enjoining and restraining Employee
from doing or continuing to do any such act and any other violation or
threatened violation of said Paragraphs 12, 13 and 14 hereof.
17. SEVERABILITY. In the event any provision of this Agreement
shall be found to be void, the remaining provisions of this Agreement shall
nevertheless be binding with the same effect as though the void part were
deleted; provided, however, if Paragraphs 12, 13 and 14 shall be declared
invalid, in whole or in part, Employee shall execute, as soon as possible, a
supplemental agreement with Employer, granting Employer, to the extent legally
possible, the protection afforded by said Paragraphs. It is expressly
understood and agreed by the parties hereto that Employer shall not be barred
from enforcing the restrictive covenants contained in each of Paragraphs 12, 13
and 14 as each are separate and distinct, so that the invalidity of any one or
more of said covenants shall not affect the enforceability and validity of the
other covenants.
18. INCOME TAX WITHHOLDING. Employer or any other payor may
withhold from any compensation or benefits payable under this Agreement such
Federal, State, City or other taxes as shall be required pursuant to any law or
governmental regulation or ruling.
19. OTHER TAX CONSIDERATIONS. Notwithstanding any other provision
of this Agreement to the contrary, in the event that any payment or benefit
received or to be received by Employee is triggered by an event described in
subparagraph (d) of Paragraph 9 of this Agreement, whether such payment or
benefit is pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with Employer or any Affiliate of Employer
(hereinafter, all such payments and benefits being sometimes referred to as
"Total Payments"), and would not be deductible, either in whole or in part, by
Employer or an Affiliate making such payment or providing such benefit as a
result of Section 280G of the Internal Revenue Code of 1986, as amended (the
"Code"), then, to the extent necessary to make such portion of the Total
Payments deductible (and after taking into account any reduction in the Total
Payments provided by reason of Section 280G of the Code in any such other plan,
arrangement or agreement), (A) the cash portion of the Total Payments provided
in this Paragraph 19 shall first be reduced (if necessary, to zero (0)), and
(B) all other non-cash Total Payments under this Paragraph 19 shall next be
reduced (if necessary, to zero (0)); provided, however, that the Employee's
payment shall only be reduced by this Paragraph 19 if Employer determines that
reducing the Total Payments would result in greater after-tax proceeds to the
Employee than if no such reduction in Total Payments had occurred. Any
determination required by the preceding sentence shall be made by independent
certified public accountants or tax counsel (hereinafter, such party shall
sometimes be hereinafter referred to as the "Independent Adviser") selected by
Employer, the
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selection of which shall be reasonably acceptable to Employee. In making
Employer's determination as to the application and effect of this Paragraph 19
on any payments or benefits received or to be received by Employee, (i) no
portion of the Total Payments shall be taken into account which in the opinion
of the Independent Adviser does not constitute a "parachute payment" within the
meaning of Section 280G(b)(2) of the Code, including by reason of Section
280G(b)(4)(A) of the Code; (ii) those Total Payments provided under this
Paragraph 19 shall be reduced only to the extent necessary so that the Total
Payments (other than those referred to in clause (i)) in their entirety
constitute reasonable compensation for services actually rendered within the
meaning of Section 280G(b)(4)(B) of the Code or are otherwise not subject to
disallowance as deductions, in the opinion of the Independent Adviser; and
(iii) the value of any non-cash benefit or any deferred payment or benefit
included in the Total Payments shall be determined by the Company's independent
certified public accountants in accordance with the principles of Sections
280G(d)(3) and (4) of the Code.
20. WAIVER. The waiver of a breach of any term of this Agreement
by any of the parties hereto shall not operate or be construed as a waiver by
such party of the breach of any other term of this Agreement or as a waiver of
a subsequent breach of the same term of this Agreement.
21. RIGHTS AND LIABILITIES UPON NOTICE OF TERMINATION. As soon as
notice of termination of this Agreement is given, Employee shall immediately
cease contact with all customers of Employer and shall forthwith surrender to
Employer all customer lists, documents and other property of Employer then in
his possession, compliance with which shall not be deemed to be a breach of
this Agreement by Employee. Pending the surrender of all such customer lists,
documents and other property to Employer, Employer may hold in abeyance any
payments due Employee pursuant to this Agreement.
22. ASSIGNMENT.
(a) Employee shall not assign, transfer or convey this
Agreement, or in any way encumber the compensation
or other benefits payable to him hereunder, except
with the prior written consent of Employer or upon
Employee's death.
(b) The covenants, terms and provisions set forth herein
shall be binding upon and shall inure to the benefit
of, and be enforceable by, Employer and its
successors and assigns.
23. NOTICES. All notices required herein shall be in writing and
shall be deemed to have been given when delivered personally or when deposited
in the U.S. Mail, certified or registered, postage prepaid, return receipt
requested, addressed as follows, to wit:
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If to Employer at:
000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
With a copy to:
Xxxxx Xxxxxxx Xxxxxx Xxxxxxx & Xxxxxxxxx, P.C.
0000 XxxxxXxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx Xxxxx, Esquire
If to Employee at:
0000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx 00000
or at such other addresses as may, from time to time, be furnished to Employer
by Employee, or by Employer to Employee on the terms of this Paragraph.
24. BINDING EFFECT. This Agreement shall be binding on the
parties hereto and on their respective heirs, administrators, executors,
successors and permitted assigns.
25. ENFORCEABILITY. This Agreement contains the entire
understanding of the parties and may be altered, amended or modified only by a
writing executed by both of the parties hereto. This Agreement supersedes all
prior agreements and understandings by and between Employer and Employee
relating to Employee's employment.
26. APPLICABLE LAW. This Agreement and the rights and liabilities
of the parties hereto shall be governed by, and construed and interpreted in
accordance with, the laws of the State of Georgia.
27. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original, but all of which
together shall constitute but a single document.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, Employee has hereunder set his hand and seal, and
Employer has caused this Agreement to be executed and delivered by its duly
authorized officers, all as of the day and year first above written.
(SEAL)
------------------------------- -----------------------------------
WITNESS XXXXXX X. XXXXXXX
ATTEST: ALLIED HOLDINGS, INC.
By: By:
---------------------------- --------------------------------------
Its Secretary Its President
----------------- ------------------
[CORPORATE SEAL]
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