EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into by and between Celadon Trucking
Services. Inc., a corporation with its principal place of business located at
One Celadon Drive, 0000 Xxxx 00xx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000
("Corporation") and Xxxx Xxxxxxx, an individual currently residing in
Indianapolis, Indiana ("Employee").
Recitals
A. Employee is employed by the Corporation as an Executive Vice President
based in Indianapolis, lndiana.
B. Corporation and Employee desire by this writing to set forth the
continued employment relationship between the Corporation and Employee.
Agreement
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the parties
hereto agree as follows:
1. Employment. The Corporation hereby employs Employee, and Employee
hereby accepts employment with the Corporation, as one of Corporation's
Executive Vice Presidents upon the terms and conditions set forth below.
2. Term. The term of employment shall be from The date of execution of
this Agreement for a period of two years or until terminated in accordance with
the provisions set forth herein. The period during which Employee is employed
under this Agreement is hereinafter referred to as the "Employment Period." At
the conclusion of the Employment Period, this Agreement shall automatically
renew for successive one year periods, unless terminated sooner.
3. Duties. During The Employment Period, Employee agrees to devote his
full business time, attention, skill and efforts to the performance of his
duties as an Executive Vice President of the Corporation. Employee's specific
duties shall include an activities commensurate with and typical of an executive
vice president of a public corporation including, but not limited to, any work
which may be assigned to him by Corporation's President and/or Chairman. Nothing
contained herein shall prohibit the Corporation from reassigning Employee to any
duties consistent with his knowledge, skill and management ability as determined
by Corporation's President and/or Chairman, provided however, that in no event
shall Employee be transferred
and physically relocated to a place of business other than the Corporation's
principal place of business set forth above without the consent and approval of
Employee.
4. Compensation. Employee shall receive for each year of The Employment
Period an annual salary of $120,000.00 ("Base Salary"). Employee shall also be
entitled to an annual increase in salary on April 1 of each year of Employee's
employment under this Agreement as a minimum in a percentage equal to the rise
in the Consumer Price Index as reported in the Wall Street Journal on that date
or if not reported on that date then the last publication thereof. Employee's
Base Salary shall be payable by the Corporation on a bi-weekly basis and
deductions shall be made for payroll withholding, social security, contributions
to the Corporation's retirement plans and such other deductions as may be
required by law or elected by Employee in writing. Employee shall be entitled to
participate in the Corporation's health insurance, retirement plans and other
benefit plans.
4.1 Bonus. In addition to Employee's salary, Employee shall receive
each year during the Employment Period an additional bonus in an amount
proportionate to other key managers of the Corporation as determined by
the Board of Directors. Such bonus shall be payable within five days after
completion of the Corporation's annual audit of each fiscal year of the
Corporation during the Employment Period.
4.2 Car Allowance. During the term of Employee's employment with the
Corporation, Employee shall be entitled to a monthly allowance to be used
exclusively for the purpose of defraying Employee's costs of an
automobile, which will be used in furtherance of Employee's duties to the
Corporation ("Car Allowance"). Employee's Car Allowance shall be paid to
Employee on a monthly basis in an amount equal to $450.00.
4.3 Vacation. Employee shall be entitled to reasonable paid
vacations in accordance with the then regular procedures of the
Corporation governing executives.
5. Severance Pay. The Corporation agrees that in all cases in which the
Corporation terminates this Agreement, other than in the event the Agreement is
terminated for a breach of Employee's fiduciary duty or for any "for cause"
reason including the termination provision set forth in Paragraph 8(b)(1) of
this Agreement, Corporation shall pay Employee an amount equal to the greater of
either the amount equal to six months of Employee's then current Base Salary (as
defined in Section
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4 or one half of the remaining amount of Employee's then current Base Salary (as
defined in Paragraph 4) to be paid in the Employment Period payable in 13 equal
bi-weekly installments until fully paid ("Severance Pay"). Severance Pay shall
begin at the next scheduled date, following termination, that the Corporation
pays its executives their wages. Corporation's obligations under this Section 5
shall terminate on the date that Employee obtains any type of employment
subsequent to his employment with Corporation or on the date that Employee files
for unemployment compensation.
Employee acknowledges that the Severance Pay is additional consideration
for Employee's covenants set forth in Paragraphs 6 and 7 herein. In the event
Employee violates any fiduciary duty to the Corporation, or any term within this
Agreement during the Agreement or for the six month period during which the
restrictive covenants set forth herein apply, the Corporation may, at its
option, terminate Severance Pay to Employee. Termination of Severance Pay shall
not be the Corporation's exclusive remedy in the event Employee breaches his
fiduciary duty or the restrictive covenants set forth in Paragraphs 6 and 7
herein.
6. Engaging in Other Employment. Employee agrees that during the term of
this Agreement, he will devote his entire productive business time, attention,
skills and efforts to the business of the Corporation and to his duties under
this Agreement. Employee further agrees that during the term of this Agreement
and for period of six months thereafter, he will not engage in any other
business duties or pursuits whatsoever, directly or indirectly, that compete
with the Corporation's business, is a breach of Employee's fiduciary duty to the
Corporation, or otherwise interferes with the performance of his duties under
this Agreement. Nothing in this Paragraph 6 shall necessarily prevent Employee
from taking action to obtain other employment when such action is taken after
Employee ceases employment with Corporation and provided such employment does
not result in the violation of this Agreement. In the event Employee complies
with the provisions of Paragraph 6, the Corporation shall fulfill its Severance
Pay obligations.
7. Restrictive Covenant. Employee understands and appreciates that, in his
capacity as Executive Vice President of the Corporation, he will be entrusted
with, have access to and become familiar with certain confidential information
and trade secrets relating to the Corporation's operations, customers,
purchasing and pricing practices, and other information and that many, if not
all, of the things that Employee will learn or be exposed to constitute trade
secrets as that term is defined under Ind. Code ss. 24-2-3-2. Employee also
understands and agrees that the Corporation has a legitimate interest in
assuring that such confidential information and trade secrets are not used by
Employee in a manner that would be disadvanta-
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geous to the Corporation or which could violate Indiana's Trade Secrets Act. As
a result, and in exchange for the considerations provided pursuant to this
Agreement, Employee agrees that he will not, directly or indirectly, either
during this Agreement or for a period of six months after the date Employee's
employment ceases:
a. Release to any person, firm or corporation in any manner whatsoever,
any information obtained primarily as a result of Employee's
employment with the Corporation concerning any matters affecting or
relating to the business of the Corporation, including, but not
limited to, any customer lists or other information concerning the
business of the Corporation, its manner of operation, its plans,
practices, processes or other data, without regard to whether all of
the foregoing matters will be deemed confidential, material or
important;
b Call or Solicit, either for himself or for any other person, firm or
corporation, any of the customers of the Corporation on whom
Employee obtained knowledge of, became acquainted with or whose
information Employee had access to as a result of his employment
with the Corporation; or
c. Make known to any person, firm or corporation, either directly or
indirectly, any of the plans, financial information, sales and
marketing information, or potential undertakings of the Corporation.
d. Engage in any employment or business activity that is in competition
or is reasonably expected to be in competition with the Corporation.
Employee further agrees that all books, records, samples, customer lists, price
lists, accounts, financial information and other property relating in any manner
to the Corporation's business or customers, whether prepared by Employee or
otherwise coming into Employee's possession, are the exclusive property of the
Corporation and shall be returned immediately to the Corporation upon
termination of this Agreement or at the time Employee ceases employment with the
Corporation.
Since the damages to the Corporation resulting from a breach by Employee of the
provisions of this Section 7 could not adequately be compensated by money
damages, the Corporation shall be entitled to, in addition to any other right or
remedy available to it, an injunction restraining such breach or threatened
breach, and in any case, no bond or other security shall be required in
connection therewith except as provided by law. Employee agrees that the
provisions of this Section 7
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are necessary and reasonable to protect the Corporation in the conduct of its
business. If any restriction contained in this Section 7 shall be deemed
invalid, illegal or unenforceable by reason of the extent, duration or
geographical scope hereof, or otherwise, then the court making such
determination shall have the right to reduce such form, extent, duration,
geographical scope or other provisions hereof and, in its reduced form, such
restriction shall then be enforceable in the manner contemplated hereby.
8. Termination by the Company
a. Termination for Illness or Disability. In the event of the illness,
accident, or other disability (mental or physical) of Employee
during the Employment Period which renders Employee unable to
perform the duties required of him with or without a reasonable
accommodation as that term is defined in the Americans With
Disabilities Act. Employee's employment under this Agreement shall
immediately terminate. During the period commencing on the date of
the termination of Employee's employment pursuant to This Section
8(a) by reason of illness, accident, or disability and ending one
year from such date (the "Termination Date"), or until Employee's
death, if earlier, Employee shall continue to receive from the
company a salary, payable in equal bi-weekly installments, at a rate
equal to the greater of either the amount equal to six months of
Employee's then current Base Salary (as defined in Section 4) or one
half of the Base Salary payable pursuant to Section 4(a) in effect
at the date of such termination. Termination of the Employment
Period under and for purposes of this Section 8(a) shall not affect
Employee's status of employment or leave of absence for purposes of,
or rights under, any present or future pension plan, retirement
plan, group or individual life, medical, or other insurance policy
or any other agreement, arrangement, plan, or policy of a similar
nature maintained by the Company until the Termination Date or until
Employee's death, if earlier.
b. Termination for the Cause of Death. In the event of:
(1) Either the conviction of Employee of a crime constituting a
felony or the pleading of no contest to a charge constituting
a felony, the commission by Employee of any act, or Employee's
omission to take any action, in bad faith and to the detriment
of the Corporation, or the material breach by Employee of any
term of this Agreement and his failure to correct such breach
within 30
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days from the receipt of a written demand from the Corporation
that he remedy such breach, then, and in each such case, the
Corporation shall have the right to give notice of termination
of Employee's employment hereunder as of a date (not earlier
than 30 days from such notice) to be specified in such notice,
and this Agreement shall terminate on the date so specified,
or
(2) Employee's death, then this Agreement shall terminate on the
date of Employee's death, whereupon Employee's estate shall
receive from the Corporation Employee's salary at the rate
provided in Section 4 to the date on which termination shall
take effect; and
In the case of termination pursuant to clause (b)(2), the
Corporation shall pay Employee's estate the pro rata portion of his
bonus payable pursuant to Section 4(b), at the rate and at the time
payable as set forth therein, for the period commencing on the first
day of the fiscal year in which termination takes effect to the date
of such termination. In addition, in the case of termination
pursuant to clause (b)(2), the Corporation shall pay Employee's
estate an amount equal to one-half of the salary payable to Employee
pursuant to Section 4(a) in effect at the date of death of Employee,
payable in equal bi-weekly installments from the Corporation, until
the date when the Employment Period would have otherwise expired
pursuant to Section 2.
c. Without Cause. In the event of the termination by the Corporation of
Employee's employment hereunder otherwise than pursuant to Section
8(a) and 8(b), Employee shall be entitled to receive from the
Corporation, the Severance Pay specified in Section 5 of this
Corporation. Employee agrees that he may desire to pursue legal
action against Corporation rather than execute a release and accept
the severance pay specified in Section 5. Employee acknowledges and
agrees that if he wishes to forego, relinquish or waive any legal
action he believes may exist pertaining to this Agreement, his
relationship with Celadon or in any way, regardless of the nature of
the matter, directly or indirectly against Celadon or any of its
affiliates, officers, directors, employees or agents that as
additional consideration and in exchange for the severance pay,
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Employee shall execute a complete release of liability in a form
acceptable to Corporation for any and all claims that Employee may
have against Corporation, whether arising out of this Agreement or
otherwise, and whether legal or equitable.
9. Termination by Employee.
a. For Cause. In the event of the material breach by the Corporation of
any term of this Agreement (which breach shall not have been caused
by any action or omission of Employee) and the Corporation's failure
to correct such breach within 30 days from its receipt of a written
demand from Employee that it remedy such breach, Employee may
terminate this Agreement. Employee agrees that he may desire to
pursue legal action against Corporation rather than execute a
release and accept the severance pay specified in Section 5.
Employee acknowledges and agrees that if he wishes to forego,
relinquish or waive any legal action he believes may exist
pertaining to this Agreement, his relationship with Celadon or, in
any way, regardless of the nature of the matter, directly or
indirectly against Celadon or any of its affiliates, officers,
directors, employees or agents that as additional consideration and
in exchange for the severance pay. Employee shall execute a complete
release of liability in a form acceptable to Corporation for any and
all claims that Employee may have against Corporation, whether
arising out of this Agreement or otherwise, and whether legal or
equitable.
10. Corporation and its Affiliates. All references made to "Corporation"
shall include not only Celadon Group Inc., but all of its corporate and business
affiliates both inside and outside of the United States of America.
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11. Captions. The captions of this Agreement are for convenience and
identification purposes only, are not an integral part of this Agreement and are
not to be considered in the interpretation of any part of this Agreement.
12. Severability. If, pursuant to federal, state or local law, any
provision of this Agreement shall be found by a court of competent jurisdiction
to be null and void or unenforceable, all other provisions of this Agreement
shall remain in full force and effect and any such provision found not to be
enforceable shall be subject to modification by a court of competent
jurisdiction to ensure the Corporation's interests are protected and the
parties' intentions are followed to the fullest extent allowed under law. If
temporal restrictions laced on Employee's subsequent employment by Sections 6
and 7 are found to be too long, then such provisions shall apply for three
months after the termination of Employee's employment hereunder. If the
geographic restrictions on Employee's subsequent employment are found to be too
broad, then Employee's subsequent employment shall be restricted to Indiana and
the surrounding contiguous states or, if that is found to be too broad, to
Indiana.
13. Modification or Cancellation. Any modification or cancellation of any
of the provisions of this Agreement shall lot be valid unless in writing and
signed by the parties.
14. Attorney Fees and Costs. In the event of litigation between
Corporation and Employee regarding the interpretation, breach or alleged breach
of this Agreement, the prevailing party shall be entitled to receive from the
non-prevailing party the reasonable costs and legal fees which the prevailing
party expended in maintaining the litigation.
15. Assignment. Neither this Agreement nor any interest therein shall be
assigned by either party without written consent of the other.
16 Survival of Covenants. The restrictive covenants and promises of
Employee set forth in this Agreement shall survive any termination or rescission
of this Agreement unless the Corporation executes a written agreement
specifically releasing Employee from any such covenant or promise.
17. Entire Agreement. This Agreement constitutes the entire agreement
between the parties and supersedes any prior understandings or agreements among
them, whether written or oral, respecting the subject matter of this Agreement.
18. Waiver. Any waiver by either party of a breach of any provision of
this Agreement shall not operate as or be construed to be a waiver of any other
breach
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of such provision or of any other provision of This Agreement. The failure of a
party to insist upon such adherence to this Agreement on one or more occasions
shall not be considered a waiver or deprive the party of the right thereafter to
insist upon strict adherence to that term or any other term of this Agreement.
Any waiver of any term, provision or remedy must be in writing and signed by the
waiving party.
19. Cancellation of Other Agreements. Effective as the date hereof, any
and all prior employment agreements between Employee and the Corporation are
hereby and in all respects terminated and canceled, and the Corporation shall
assume no obligations thereunder or with respect thereto.
20. Governing Law. This Agreement shall be governed by the laws of the
State of Indiana and the proper venue of any suit to enforce this Agreement
shall be only in Xxxxxx County, Indiana.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
below their signature. The effective date of this Agreement shall be the date of
the latest signature.
Celadon Trucking Services, Inc.
By: /s/ Xxxxx Xxxxxxx /s/ Xxxxxxx X. Archuad
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Xxxxx Xxxxxxx, President Xxxxxxx X. Archuad
Date: 19/30/97 Date: 10/30/97
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