EXHIBIT 99.1
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
effective as of January 24, 2006 (the "Effective Date"), by and between Forward
Air Corporation, a corporation organized under the laws of the State of
Tennessee (the "Company"), and Xxxxx X. Xxxxxxxx (the "Executive").
For and in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. EMPLOYMENT. Subject to the terms and conditions of this Agreement,
Executive shall be employed by the Company as President and Chief Executive
Officer of the Company and shall perform such duties and functions for the
Company and any company controlling, controlled by or under common control with
the Company (such companies hereinafter collectively called "Affiliates") as
shall be specified from time to time by the Board of Directors of the Company.
Executive hereby accepts such employment and agrees to perform such executive
duties as may be assigned to him.
2. DUTIES. Executive shall devote his full business-related time and best
efforts to accomplishing such executive duties at such locations as may be
requested by the Board of Directors of the Company. As a part of his duties,
Executive shall present a succession plan for the Company, specifically
addressing every officer position of the Company, to the Board by December 1 of
each year, beginning December 1, 2006, so that the succession plan may be
reviewed by the Board approximately six (6) months prior to each annual
shareholders meeting of the Company. While employed by the Company, Executive
shall not serve as a principal, partner, employee, officer or director of, or
consultant to, any other business or entity conducting business for profit
without the prior written approval of the Board of Directors of the Company. In
addition, under no circumstances will Executive have any financial interest in
any competitor of the Company; provided, however, that Executive may invest in
no more than 2% of the outstanding stock or securities of any competitor whose
stock or securities are traded on a national stock exchange of any country.
Executive may serve on two (2) boards of organizations without approval of the
Board, provided that the organizations are not in competition with the Company
and conduct no business with the Company.
3. COMPANY POLICIES. Executive shall be subject to and shall comply with
all codes of conduct, personnel policies and procedures applicable to employees
and/or senior executives of the Company, including, without limitation, policies
regarding sexual harassment, conflicts of interest and xxxxxxx xxxxxxx.
4. TERM. The term of this Agreement shall be for a fixed period from the
date of its execution by both parties until 5:00 p.m. on the day immediately
before the 2008 annual shareholders meeting of the Company.
5. RENEWAL. This Agreement will be automatically extended for additional
one (1) year terms unless the Executive or the Board of Directors of the Company
provides written notice of non-renewal no less than six (6) months prior to the
expiration of the then-pending term.
6. COMPENSATION AND BENEFITS. As compensation for his services during the
Term of this Agreement and based upon the performance of Executive and the
Company during each calendar year, Executive shall be paid and receive the
amounts and benefits set forth in subparagraphs (a), (b), (c) and (d) below:
(a) BASE SALARY. An annual base salary ("Base Salary") of no less than Four
Hundred Thousand Dollars ($400,000.00). Executive's Base Salary will be
consistent with the salaries of the chief executive officers for companies
within a peer group chosen by the Compensation Committee. Executive's Base
Salary shall be payable in accordance with the Company's regular payroll
practices in effect from time to time for executive officers of the Company.
(b) BONUS. Executive shall be eligible for an annual cash bonus to be paid
to him in the form of a Year-End Bonus. The amount of such Year-End Bonus, if
any, will be based on the achievement of certain goals by Executive and the
Company's performance criteria as established by the Board of Directors or a
committee thereof. Moreover, such Year-End Bonus, if any, shall be consistent
with the annual incentives awarded to chief executive officers of companies
within a peer group chosen by the Compensation Committee. The Year-End Bonus for
each calendar year, if any, shall be paid to Executive on the later of (1)
February 28th of the immediately succeeding year or (2) within thirty days of
receipt by the Company of a final financial audit of the Company's performance
for the preceding calendar year.
(c) OTHER BENEFITS. Executive shall be entitled to vacation with pay,
health insurance, fringe benefits, and such other employee benefits generally
made available by the Company to its executive officers, in accordance with the
established plans and policies of the Company, as in effect from time to time.
(d) LONG TERM INCENTIVE. Executive shall be granted stock options,
restricted stock or such other form of long term incentive permitted under the
Forward Air Corporation 1999 Stock Option and Incentive Plan (the "Stock Option
Plan"), or such other Stock Option/Incentive Plan(s) as may be implemented by
the Board of Directors from time to time, and consistent with the awards to
chief executive officers of companies within a peer group chosen by the
Compensation Committee. The terms and conditions of the options, restricted
stock or other form of long term incentive shall be set forth in an Agreement at
the time of the grant or award and, such grant or award shall be made in
accordance with the Stock Option Plan and its terms and conditions as they may
exist at the time of Executive's exercise, sale or other disposition of any part
of the grant or award.
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7. TERMINATION.
(a) BY COMPANY WITHOUT JUST CAUSE. The Company may terminate Executive's
employment hereunder, in its sole discretion, without just cause (as defined in
Paragraph 7(b) below), at any time upon written notice to Executive. If, prior
to the end of the Term of this Agreement, the Company terminates Executive's
employment without "just cause," the Executive shall be entitled to receive the
compensation and benefits set forth in subparagraphs (i) through (iii) below.
(i) BASE SALARY. The Executive will continue to receive his Base
Salary (subject to withholding of all applicable taxes and any amounts referred
to in subparagraph (iii) below) for a period of one (1) year, or for the
remainder of the then-pending term of this Agreement, whichever is longer with
such payments to be made in the same manner paid as of the date of termination.
(ii) BONUS. Any bonus amounts that the Executive had previously earned
from the Company, but which may not yet have been paid as of the termination,
shall not be affected by termination of Executive by the Company.
(iii) INSURANCE COVERAGE. Any health insurance benefits coverage
(including any executive medical plan, if any) provided to the Executive at his
date of termination shall be continued by the Company at its expense at the same
level and in the same manner as if his employment had not terminated beginning
on the date of such termination and ending on the date one (1) year from the
date of such termination. Any additional coverages the Executive had at
termination, including dependent coverage, will also be continued for such
period on the same terms. Any costs the Executive was paying for such coverages
at the time of termination shall be paid by the Executive by separate check
payable to the Company each month in advance. If the terms of any benefit plan
referred to in this paragraph do not permit continued participation by the
Executive, then the Company will arrange for other coverage at its expense
providing substantially similar benefits. The coverages provided for in this
paragraph shall be applied against and reduce the period for which COBRA will be
provided.
(b) BY COMPANY WITH JUST CAUSE. Executive hereby agrees and acknowledges
that if he is terminated for just cause, as defined below, prior to the end of
the Term of this Agreement, then he shall be entitled to no payment or
compensation whatsoever (including without limitation, acceleration of unvested
stock options) from the Company under this Agreement, other than as may be due
him through his last day of employment.
DEFINITION OF "JUST CAUSE." For purposes of this Agreement, the phrase
"just cause" shall mean: (i) Executive's fraud, malfeasance, self-dealing,
embezzlement or dishonesty with respect to business affairs of the Company
whether or not the Company is materially harmed; (ii) Executive's conviction of
or failure to contest prosecution for a felony or a crime involving moral
turpitude; (iii) Executive's material breach of this Agreement; (iv) failure of
Executive, after reasonable notice, to comply promptly with any valid and legal
directive of the Board of Directors; or (v) a failure by Executive to perform
adequately his responsibilities under this Agreement as demonstrated by
objective and verifiable evidence showing that the business operations under
Executive's control have been materially harmed as a result of Executive's gross
negligence or willful misconduct.
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A termination of Executive for just cause based on subparagraphs (iii),
(iv) or (v) of the preceding sentence shall take effect thirty (30) days after
the Executive receives from the Company written notice of intent to terminate
and the Company's description of the alleged cause, unless Executive shall,
during such thirty (30)-day period, remedy the events or circumstances
constituting cause; provided, however, that such termination shall take effect
immediately upon the giving of written notice of termination of just cause under
any clause if the Company shall have determined in good faith that such events
or circumstances are not remediable (which determination shall be stated in such
notice).
(c) BY EXECUTIVE WITHOUT CHANGE OF CONTROL OR MATERIAL CHANGE IN DUTIES.
Executive hereby agrees and acknowledges that if he resigns without a change of
control or a material change in duties, as defined below, prior to the end of
the Term of this Agreement, then he shall be entitled to no payment or
compensation whatsoever (including without limitation, acceleration of unvested
stock options) from the Company under this Agreement, other than as may be due
him through his last day of employment.
(d) BY EXECUTIVE WITH CHANGE OF CONTROL OR MATERIAL CHANGE IN DUTIES. Upon
occurrence of an event constituting a "Change of Control" or "Material Change of
Duties" as defined herein, Executive may elect to resign his employment and,
agreeing to waive any other compensation, elect to receive a Change OF CONTROL
BENEFIT or Material Change in Duties Benefit as follows: (i) an amount equal to
Executive's Base Salary over a twelve month period, payable in installments as
normal payroll over the twelve months following the date of the Change of
Control or Material Change in Duties; (ii) the payment of a Year-End Bonus in an
amount equal to the Year-End Bonus awarded to Executive in the prior year, which
shall be payable in accordance with Paragraph 6(b) hereof; (iii) any unpaid
portion of the Year-End Bonus for prior calendar years, accrued and unpaid
vacation pay, unreimbursed expenses incurred and any other benefits owed to
Executive pursuant to any written employee benefit plan or policy of the
Company; (iv) the vested portion of Executive's stock options and the
acceleration and immediate vesting of any unvested portion of Executive's stock
options under Paragraph 6(d) hereof; and (v) continued coverage during the
twelve month period following the date of the Change in Control or Material
Change in Duties under the Company's employee medical and life insurance plans.
Executive may, in accordance with the Stock Option Plan, exercise all vested
stock options.
(e) IF EXECUTIVE DECLINES CHANGE OF CONTROL BENEFIT OR MATERIAL CHANGE IN
DUTIES BENEFIT. Without limiting the generality of the foregoing, after a Change
of Control or Material Change in Duties, and if Executive declines the Change in
Control Benefit or Material Change in Duties Benefit, in writing, Executive
shall be employed as the President and Chief Executive Officer of the Company
until this Agreement expires or is terminated pursuant to the provisions of
Paragraph 7 hereof (including termination by Executive pursuant to Paragraph
7(c)).
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8. DEFINITIONS.
(a) "CHANGE OF CONTROL OR MATERIAL CHANGE IN DUTIES" shall be deemed to
have taken place if subparagraphs (b)(i), (ii) or (iii) or subparagraph (c)
below occur.
(b) "CHANGE OF CONTROL" shall be deemed to have occurred when:
(i) any person or entity, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended, other than the
Company, a wholly-owned subsidiary thereof, or any employee benefit plan of the
Company or any of its subsidiaries becomes the beneficial owner of Company
securities having 50% or more of the combined voting power of the
then-outstanding securities of the Company that may be cast for the election of
directors of the Company (other than as a result of the issuance of securities
initiated by the Company in the ordinary course of business); OR
(ii) as the result of, or in connection with, any cash tender or
exchange offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing transactions, the
holders of all the Company's securities entitled to vote generally in the
election of directors of the Company immediately prior to such transaction
constitute, following such transaction, less than a majority of the combined
voting power of the then-outstanding securities of the Company or any successor
corporation or entity entitled to vote generally in the election of the
directors of the Company or such other corporation or entity after such
transactions; OR
(iii) the Company sells all or substantially all of the assets of the
Company.
(c) "MATERIAL CHANGE IN DUTIES" shall be deemed to have occurred when the
Executive is assigned any duties inconsistent in any material respect with
Executive's position (including status, offices, titles and reporting
requirements), authority, duties or responsibilities as in effect on the
Effective Date, or any other action by the Company which results in a materially
demonstrable diminution in such position, authority, duties or responsibilities.
(d) "BY DEATH OR DISABILITY." If Executive's employment is terminated due
to Executive's death, the Executive's surviving spouse, or if none, his estate,
shall receive the benefits payable under (i), (ii) and (iii) of Paragraph 7(a)
above; provided, however, any payments due thereunder shall be made in a lump
sum payment within 60 days of the Executive's death. In addition, if the
Executive's dependents are eligible to and actually elect to continue under
COBRA any coverages provided under Paragraph 7(a)(iii), the Company shall pay
the cost of such COBRA coverage for the period remaining under Paragraph
7(a)(iii). If Executive's employment is terminated due to Executive's disability
(as defined in the Company's long-term disability plan or insurance policy, or
if no such plan or policy exists, as determined in good faith by the Board of
Directors of the Company), Executive shall be entitled to the benefits payable
or to be provided under (i), (ii) and (iii) of Paragraph 7(a). Executive or his
estate, as the case may be, shall not by operation of this paragraph forfeit any
rights in which he is vested at the time of his death or disability.
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9. NON-COMPETITION, NON-DISCLOSURE, AND NON-SOLICITATION. Executive agrees
to execute and be bound by the terms and conditions of the Restrictive Covenants
Agreement attached hereto as EXHIBIT A, which is hereby made a part of this
Agreement. Upon termination of this Agreement, for whatever reason, Executive
remains bound to the Non-Competition, Non-Disclosure and Non-Solicitation
obligations set forth in EXHIBIT A hereto.
10. INJUNCTIVE RELIEF. The Executive acknowledges that his services to be
rendered to the Company are of a special and unusual character which have a
unique value to the Company, the loss of which cannot adequately be compensated
by damages in an action at law. Executive further acknowledges that any breach
of the terms of Paragraph 9, including EXHIBIT A, would result in material
damage to the Company, although it might be difficult to establish the monetary
value of the damage. Executive therefore agrees that the Company, in addition to
any other rights and remedies available to it, shall be entitled to obtain an
immediate injunction (whether temporary or permanent) from any court of
appropriate jurisdiction in the event of any such breach thereof by Executive,
or threatened breach which the Company in good faith believes will or is likely
to result in irreparable harm to the Company. The existence of any claim or
cause of action by Executive against the Company, whether predicated on this
Agreement or otherwise, shall not constitute a defense to the enforcement by the
Company of Executive's agreement under this Paragraph and Paragraph 9 above. In
the event that Company institutes suit against Executive to enforce its rights
hereunder and is not successful on the merits, then Company shall indemnify
Executive from and against any and all costs (including attorneys' fees and
legal expenses) and other expenses which Executive expended in defending said
action.
11. MISCELLANEOUS.
(A) NOTICE. Any notice or other communication required or permitted under this
Agreement shall be effective only if it is in writing and shall be deemed to
have been duly given when delivered personally or seven (7) days after mailing
if mailed first class by registered or certified mail, postage prepaid,
addressed as follows:
If to the Company: Forward Air Corporation
000 Xxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Attention: Legal Department
If to the Executive: Xxxxx X. Xxxxxxxx
000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
or to such other address as either party may designate by notice to the
other.
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(b) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto with respect to the Executive's employment by the
Company and supersedes and is in full substitution for the Employment Agreement,
dated October 27, 2003, between the Company and Executive and any and all other
prior understandings or agreements with respect to the Executive's employment.
(c) AMENDMENT. This Agreement may be amended only by an instrument in
writing signed by the parties hereto, and any provision hereof may be waived
only by an instrument in writing signed by the party or parties against whom or
which enforcement of such waiver is sought. The failure of either party hereto
to comply with any provision hereof shall in no way affect the full right to
require such performance at any time thereafter, nor shall the waiver by either
party hereto of a breach of any provision hereof be taken or held to be a waiver
of any succeeding breach of such provision, or a waiver of the provision itself,
or a waiver of any other provision of this Agreement.
(d) BINDING EFFECT. This Agreement is binding on and is for the benefit of
the parties hereto and their respective successors, heirs, executors,
administrators and other legal representatives provided, however, that in the
event of Executive's death, the provisions of Paragraph 9 or EXHIBIT A shall not
be binding upon Executive's heirs or executors. Although the non-competition,
non-disclosure and non-solicitation obligations of Executive set forth in
Paragraph 9 and EXHIBIT A hereto may extend to the Company's successors and
assigns, the remaining rights and obligations of this Agreement shall not be
assigned by the Executive or the Company, except for assignment by the Company
to any wholly owned subsidiary.
(e) SEVERABILITY AND MODIFICATION. If any provision of this Agreement or
portion thereof is so broad, in scope or duration, so as to be unenforceable,
such provision or portion thereof shall be interpreted to be only so broad as is
enforceable. In addition, to the extent that any provision of this Agreement as
applied to either party or to any circumstances shall be adjudged by a court of
competent jurisdiction to be void or unenforceable, the same shall in no way
affect any other provision of this Agreement or the validity or enforceability
of this Agreement.
(f) FORUM SELECTION AND CHOICE OF LAW. This Agreement shall be interpreted,
construed and governed by and under the laws of the State of Tennessee. Each
party irrevocably (i) consents to the exclusive jurisdiction and venue of the
courts of Xxxxxx County, State of Tennessee and federal courts in the Eastern
District of Tennessee, in any and all actions arising under or relating to this
Agreement (including EXHIBIT A hereto), and (ii) waives any jurisdictional
defenses (including personal jurisdiction and venue) to any such action. If any
provision of this Agreement is deemed or held to be illegal, invalid, or
unenforceable under present or future laws effective during the Term hereof,
this Agreement shall be considered divisible and inoperative as to such
provision to the extent it is deemed to be illegal, invalid or unenforceable,
and in all other respects this Agreement shall remain in full force and effect;
provided, however, that if any provision of this Agreement is deemed or held to
be illegal, invalid or unenforceable there shall be added hereto automatically a
provision as similar as possible to such illegal, invalid or unenforceable
provision as shall be legal, valid or enforceable. Further, should any provision
contained in this Agreement ever be reformed or rewritten by any judicial body
of competent jurisdiction, such provision as so reformed or rewritten shall be
binding upon the Executive and the Company.
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(g) FAILURE TO ENFORCE. The failure of either party hereto at any time, or
for any period of time, to enforce any of the provisions of this Agreement shall
not be construed as a waiver of such provision(s) or of the right of such party
hereafter to enforce each and every such provision.
(h) COUNTERPARTS. This Agreement may be executed in several counterparts,
each of which shall be deemed an original, but all of which shall constitute one
and the same instrument.
(i) NO CONFLICTING AGREEMENT. The Executive represents and warrants that he
is not party to any agreement, contract or understanding which would prohibit
him from entering into this Agreement or performing fully his obligations
hereunder.
(j) COOPERATION IN FUTURE MATTERS. Executive hereby agrees that, for a
period of three (3) years following the date of his termination from employment
for whatever reason, he shall cooperate with the Company's reasonable requests
relating to matters that pertain to Executive's employment by the Company,
including, without limitation, providing information of limited consultation as
to such matters, participating in legal proceedings, investigations or audits on
behalf of the Company, or otherwise making himself reasonably available to the
Company for other related purposes. Any such cooperation shall be performed at
times scheduled taking into consideration Executive's other commitments, and
Executive shall be compensated at a reasonable hourly or per diem rate to be
agreed by the parties to the extent such cooperation is required on more than an
occasional and limited basis. Executive shall also be reimbursed for all
reasonable out-of-pocket expenses. Executive shall not be required to perform
such cooperation to the extent it conflicts with any requirements of exclusivity
of service for another employer or otherwise, nor in any manner that in the good
faith belief of Executive would conflict with his rights under or ability to
enforce this Agreement.
(k) EXPENSES. The Company shall pay all reasonable attorneys' fees and
expenses incurred by Executive in connection with the negotiation and
preparation of this Agreement.
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IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the date first written above.
EXECUTIVE
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxxx
---------------------- --------------------------------------------
Witness Xxxxx X. Xxxxxxxx
President and Chief Executive Officer
FORWARD AIR CORPORATION
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxx
---------------------- --------------------------------------------
Witness Xxxxxx X. Xxxx
Vice President and Controller
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EXHIBIT A
RESTRICTIVE COVENANTS AGREEMENT
This RESTRICTIVE COVENANTS AGREEMENT (this "Agreement" or this
"Restrictive Covenants Agreement") is entered into as of January 24, 2006 by and
between Forward Air Corporation (the "Company") and Xxxxx X. Xxxxxxxx (the
"Executive") contemporaneously with and as part of the Employment Agreement
between the parties to which this Restrictive Covenants Agreement is attached.
REASONS FOR THIS AGREEMENT: During Executive's relationship with the
Company, Executive has learned, will learn, or has or will have access to,
important proprietary information related to the operations and business of
Forward Air Corporation and its subsidiaries and affiliates (collectively, the
"Company's Business"). Executive acknowledges that the proprietary customer,
operations, financial, and business information that has been or will be learned
or accessible has been and will be developed through the Company's expenditure
of substantial effort, time and money, and together with relationships developed
with customers and employees, could be used to compete unfairly with the
Company. The Company's ability to sell its products on a competitive basis
depends, in part, on its proprietary information and customer relationships, and
the Company would not share this information, provide training or promote
Executive's relationship with customers if the Company believed that it would be
used in competition with the Company, which non-disclosure would cause
Executive's performance and opportunities to suffer. Further, the value of the
Company to any potential buyer will be based in part upon the restrictive
covenants and commitments contained herein.
In consideration of employment or continued employment and other valuable
consideration, the receipt and sufficiency of which are acknowledged, the
Company and Executive agree:
1. DEFINITIONS: For this Restricted Covenants Agreement, the following
terms shall have the meaning specified below:
(a) PERSON: Any individual, corporation, limited liability company,
partnership, joint venture, association, unincorporated organization or other
entity.
(b) TERMINATION DATE: The date of Executive's termination of employment
from the Company, whether such termination is voluntary or involuntary, whether
with or without cause, and whether before or after the expiration of the Term of
the Executive's Employment Agreement.
(c) CUSTOMERS: All customers of the Company who did business with the
Company during the one (1)-year period immediately prior to the Executive's
Termination Date.
(d) CONFIDENTIAL INFORMATION: "Confidential information" as defined herein
shall exclude company trade secrets and is defined as such other information not
rising to the level of a trade secret, relating to the Company's customers,
operation, finances and business that derives value, actual or potential, from
not being generally known to other Persons, including, but not limited to,
technical or non-technical data, formulas, patterns, compilations (including
compilations of customer information), programs (including fulfillment and
marketing programs), devices, methods (including fulfillment methods),
techniques, processes, financial data (including sales forecasts) or lists of
actual or potential customers or suppliers (including identifying information
about those customers), whether or not reduced to writing. Confidential
Information includes information disclosed to the Company by third parties that
the Company is obligated to maintain as confidential.
(e) TERRITORY: The term "Territory" as used in this Restrictive Covenants
Agreement means the continental United States and Canada. Executive acknowledges
that Executive will have direct and indirect supervisory responsibility for the
development of markets and to provide services to Company throughout the
Territory.
(f) COMPETING BUSINESS: Any Person (other than the Company) providing or
offering goods or services identical to or reasonably substitutable for the
Company's Business.
2. TRADE SECRETS AND CONFIDENTIAL INFORMATION: Executive shall not use or
disclose the Company's trade secrets during or after employment. Executive shall
not use or disclose Confidential Information for a period of two (2) years
following the termination of employment for any reason, except in connection
with his duties performed in accordance with his Employment Agreement or except
with the prior written consent of the Chairman of the Board of the Company;
provided, however, Executive may make disclosures required by a valid order or
subpoena issued by a court or administrative agency of competent jurisdiction,
in which event Executive will promptly notify the Company of such order or
subpoena to provide the Company an opportunity to protect its interests.
3. RETURN OF MATERIALS: On the Termination Date, or for any reason or at
any time at the Company's request, Executive will deliver promptly to the
Company all materials, documents, plans, records, notes or other papers and any
copies in Executive's possession or control relating in any way to the Company's
Business, which at all times shall be the property of the Company.
4. NON-SOLICITATION OF EMPLOYEES: During employment and for a period equal
to the longer of (i) twelve (12) months following his Termination Date or (ii)
the period during which Executive is paid pursuant to the terms of his
Employment Agreement, Executive will not solicit or induce or in any manner
attempt to solicit or induce, any person employed by the Company to leave such
employment, whether or not such employment is pursuant to a written contract
with the Company or at will.
5. NON-SOLICITATION OF CUSTOMERS: During employment and for a period equal
to the longer of (i) twelve (12) months following his Termination Date or (ii)
the period during which Executive is paid pursuant to the terms of his
Employment Agreement, Executive will not solicit Customers for the purpose of
providing or offering products or services identical to or reasonably
substitutable for the Company's Business.
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6. NON-COMPETITION: During employment and for a period equal to the longer
of (i) twelve (12) months following his Termination Date or (ii) the period
during which Executive is paid pursuant to the terms of his Employment
Agreement, Executive will not, within the Territory, be employed or engaged by a
Competing Business to provide services similar to those that Executive provided
to the Company.
7. FURTHER LIMITATIONS: Notwithstanding any provision of this Restrictive
Covenants Agreement to the contrary, if Executive's employment is terminated
(whether by the Company or by Executive) under circumstances that would entitle
him to receive benefits under Executive's Employment Agreement with the Company
providing compensation and benefits for terminations following a "change in
control" of the Company (as defined in such agreement), then the time periods in
Paragraph 5 and 6 above shall be reduced to twelve (12) months.
8. DISPARAGEMENT: Executive shall not at any time make false, misleading or
disparaging statements about the Company, including its products, management,
employees and customers.
9. OWNERSHIP OF CONFIDENTIAL INFORMATION: The Executive hereby agrees that
any and all improvements, inventions, discoveries, formulas, processes, methods,
know-how, confidential data, trade secrets and other proprietary information
(collectively "Work Product") within the scope of any business of the Company or
any affiliate which the Executive may conceive or make or has conceived or made
during his employment with the Company shall be and are the sole and exclusive
property of the Company, and that the Executive shall, wherever requested to do
so by the Company, at its expense, execute and sign any and all applications,
assignments or other instruments and do all other things which the Company may
deem necessary or appropriate (i) in order to apply for, obtain, maintain,
enforce or defend letters patent of the United States or any foreign country for
any Work Product, or (ii) in order to assign, transfer, convey or otherwise make
available to the Company the sole and exclusive right, title and interest in and
to any Work Product.
10. FORUM SELECTION AND CHOICE OF LAW: This Agreement shall be interpreted,
construed and governed by and under the laws of the State of Tennessee. Each
party irrevocably (i) consents to the exclusive jurisdiction and venue of the
courts of Xxxxxx County, State of Tennessee and federal courts in the Eastern
District of Tennessee, in any and all actions arising under or relating to this
Agreement, and (ii) waives any jurisdictional defenses (including personal
jurisdiction and venue) to any such action. If any provision of this Agreement
is deemed or held to be illegal, invalid or unenforceable under present or
future laws effective during the term hereof, this Agreement shall be considered
divisible and inoperative as to such provision to the extent it is deemed to be
illegal, invalid or unenforceable, and in all other respects this Agreement
shall remain in full force and effect; provided, however, that if any provision
of this Agreement is deemed or held to be illegal, invalid or unenforceable
there shall be added hereto automatically a provision as similar as possible to
such illegal, invalid or unenforceable provision as shall be legal, valid or
enforceable. Further, should any provision contained in this Agreement ever be
reformed or rewritten by any judicial body of competent jurisdiction, such
provision as so reformed or rewritten shall be binding upon the Executive and
the Company.
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IN WITNESS WHEREOF, the Company and the Executive have executed this
Restrictive Covenants Agreement as of the date first written above.
EXECUTIVE
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxxx
-------------------------- ---------------------------------------
Witness Xxxxx X. Xxxxxxxx
President and Chief Executive Officer
FORWARD AIR CORPORATION
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxx
-------------------------- ---------------------------------------
Witness Xxxxxx X. Xxxx
Vice President and Controller
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