EMPLOYMENT AND NON-SOLICITATION AGREEMENT
EXHIBIT 10.11
EMPLOYMENT AND NON-SOLICITATION AGREEMENT
THIS EMPLOYMENT AND NON-SOLICITATION AGREEMENT (“Agreement”), dated as of June 10, 2009, is by
and between DELTA APPAREL, INC., a Georgia corporation (“Company”), and Xxxxxx X. Xxxxxxxxx, a
South Carolina resident (“Executive”).
WHEREAS, Executive and the Company want to enter into a written agreement providing for the
terms of Executive’s employment by the Company.
NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
agree as follows:
1. Employment. Executive agrees to continue Executive’s employment with the Company,
and the Company agrees to employ Executive, on the terms and conditions set forth in this
Agreement. Executive agrees during the term of this Agreement to devote substantially all of his
business time, efforts, skills and abilities to the performance of his duties to the Company and to
the furtherance of the Company’s business.
Executive’s job title will be Chairman of the Board of Directors and Chief Executive Officer
and his duties will be those as are designated by the Board of Directors of the Company.
2. Compensation.
(a) Base Salary. During the term of Executive’s employment with the Company pursuant
to this Agreement, the Company shall pay to Executive as compensation for his services an annual
base salary of not less than $690,000 (Base Salary). Executive’s Base Salary will be payable in
arrears in accordance with the Company’s normal payroll procedures and will be reviewed annually
and subject to upward adjustment at the discretion of the Compensation Committee of the Company’s
Board of Directors and confirmed by the full Board of Directors.
(b) Incentive Bonus. During the term of Executive’s employment with the Company
pursuant to this Agreement, Executive shall be entitled to participate in the Company’s Short-Term
Incentive Compensation Plan as in effect from time to time. The Executive’s Base Short-Term
Incentive Compensation Base will be $600,000 during fiscal year 2010, $625,000 during fiscal year
2011, and $650,000 during fiscal year 2012. Calculation of the Executive’s Short-Term Incentive
Compensation will be the same as approved annually by the Board of Directors for the Delta Apparel,
Inc. Short-Term Incentive Compensation Participants. The maximum payout to the Executive from the
Short-Term Incentive Compensation Plan is $1,500,000 for any single fiscal year. Any cash
compensation payable under this paragraph shall be referred to as “Incentive Compensation” in this
Agreement.
(c) Incentive Stock. During the term of the Executive’s employment with the Company
pursuant to this Agreement, Executive will participate in the Delta Apparel, Inc. Incentive Stock
Award Plan (“Plan”). Under the service participation of the Plan the Executive will receive a
grant on June 29, 2009 that provides a two year award of 30,000 shares per year of Delta Apparel,
Inc. Stock upon the filing with the Securities and Exchange Commission of the Company’s Form 10K
for each of the fiscal years 2010 and 2011. Under the service participation of the Plan the
Executive will receive an annual grant on June 27, 2011 that provides an annual award of 30,000
shares of Delta Apparel, Inc. Stock upon the filing with the Securities and Exchange Commission of
the Company’s Form 10K for fiscal year 2012. If shares are not available on the date of the award,
a cash award will be made to the Executive in the amount of the value of the award as of the close
of the market on the date of the award. In addition, at or about such time the Company shall pay
the Executive in cash an amount which will be approximately sufficient, after the payment of all
applicable federal and state income taxes attributable to such payment, to pay the federal and
state income taxes which the Participant will incur by virtue of the vesting of such Award (or
portion thereof) whether received in the form of stock or cash. In the event the Executive’s
employment is terminated other than for Cause as defined in Section 4(b) of the Agreement, the full
award will be made for the fiscal year in which the Executive’s employment is terminated.
(d) Executive Fringe Benefits. During the term of Executive’s employment with the
Company pursuant to this Agreement, Executive shall be entitled to receive such executive fringe
benefits as are provided to the executives in comparable positions under any of the Company’s plans
and/or programs in effect from time to time for which Executive is eligible to participate and to
receive such other benefits as are customarily available to executives of the Company, including,
without limitation, vacations and life, medical and disability insurance.
(e) Tax Withholding. The Company shall have the right to deduct from any compensation
payable to Executive under this Agreement social security (FICA) taxes and all federal, state,
municipal, foreign or other taxes or charges as may now be in effect or that may hereafter be
enacted or required.
(f) Expense Reimbursements. The Company shall pay or reimburse Executive for all
reasonable business expenses incurred or paid by Executive in the course of performing his duties
hereunder, including, but not limited to, reasonable travel expenses for Executive. As a condition
to such payment or reimbursement, however, Executive shall maintain and provide to the Company
reasonable documentation and receipts for such expenses.
3. Term. Unless sooner terminated pursuant to Section 4 of this Agreement, and
subject to the provisions of Section 5 and Section 6 hereof, the term of this Agreement (the
“Term”) shall commence as of the first day of fiscal year 2010 and shall continue until the date of
the filing with the Securities and Exchange Commission of the Company’s Form 10K for fiscal year
2012.
4. Termination. Notwithstanding the provisions of Section 3 hereof, but subject to
the provisions of Section 5 and Section 6 hereof, Executive’s employment under this Agreement shall
terminate as follows:
(a) Death. Executive’s employment shall terminate upon the death of Executive;
provided, however, that the Company shall continue to pay (in accordance with its normal payroll
procedures) the Base Salary to Executive’s estate for a period of six (6) months after the date of
Executive’s death if Executive is employed by the Company the on date of his death.
(b) Termination for Cause. The Company may terminate Executive’s employment at any
time for “Cause” (as hereinafter defined) by delivering a written termination notice to Executive.
For purposes of this Agreement, “Cause” shall mean the Executive is convicted of a felony.
(c) Termination Without Cause. The Company may terminate Executive’s employment at
any time for any or no reason by delivering a written termination notice to Executive.
(d) Termination by Executive. Executive may terminate his employment at any time by
delivering one hundred eighty (180) days prior written notice to the Board of Directors of the
Company; provided, however, that the terms, conditions and benefits specified in Section 5 hereof
shall apply or be payable to Executive only if such termination occurs as a result of a material
breach by the Company of any provision of this Agreement which breach is not cured within ten (10)
days after the Board of Directors of the Company receives from Executive a written notice
detailing such breach.
(e) Termination Following Disability. In the event Executive becomes “disabled” (as
defined below), the Company may terminate Executive’s employment by delivering a written
termination notice to Executive. Notwithstanding the foregoing, Executive shall continue to
receive his full Base Salary and benefits to which he is entitled under this Agreement for a period
of six (6) months after the effective date of such termination. For purposes of this section, the
Executive shall be considered disabled if the Executive (i) is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period of not less than 12
months, or (ii) is, by reason of any medically determinable physical or mental impairment which can
be expected to result in death or can be expected to last for a continuous period of not less than
12 months, receiving income replacement benefits for a period of not less than three (3) months
under the Company’s disability insurance policy and/or salary continuation policy as in effect on
the date of such disability.
(f) Payments. Subject to any limitations under Section 409A of the Internal Revenue
Code of 1986, as amended (“Code”), and related Treasury Regulations, following any expiration or
termination of this Agreement or Executive’s employment hereunder, and in addition to (but not in
duplication of) any amounts owed pursuant to Section 5 or Section 6 hereof, the Company shall pay
to Executive all amounts earned by Executive hereunder prior to the date of such expiration or
termination.
(g) Non-Disparagement. Executive agrees that during and following the termination of
his employment he will not publicly (or in a manner he reasonably should have expected to be made
public) disparage or otherwise make negative comments regarding the Company, its employees or its
affiliates, provided, however, that the foregoing shall in no way restrict the Executive from in
good faith reporting any concerns that he may have to (i) any authority within the Company
designated to receive complaints or concerns from employees, including, without limitation, the
Company’s Board of Directors or a committee thereof, or (ii) any regulator or other governmental
authority with supervisory responsibility for the Company (including, without limitation, the
Securities and Exchange Commission) or the Company’s independent auditors.
5. Certain Termination Benefits. In the event that:
(i) the provisions of Section 6 do not apply;
(ii) either the Company terminates Executive’s employment without Cause pursuant to
Section 4(c) or Executive terminates his employment pursuant to Section 4(d) as a
result of an uncured material breach by the Company of any provision of this Agreement; and
(iii) the Executive executes and delivers the release contemplated in subsection (e)
below, then in such case the Company will provide Executive the benefits described in
subsection (a) below and, if and to the extent that Executive is eligible to participate in
such plans, subsections (b) through (c) below.
(a) Base Salary and Incentive Compensation. The Company shall pay to Executive (i)
his Base Salary (as in effect as of the date of his termination) and (ii) Incentive Compensation
(in an aggregate amount as follows:
| Years of Service with | Base | Payout | ||||
| The Company | Salary | Incentive Compensation | Period | |||
Less than one
|
3 months | 25% of the Short Term Incentive Plan award for the most recent full fiscal year prior to termination | 3 months | |||
One but less than two
|
6 months | 50% of the Short Term Incentive Plan award for the most recent full fiscal year prior to termination | 6 months | |||
Two but less than three
|
9 months | 75% of the Short Term Incentive Plan award for the most recent full fiscal year prior to termination | 9 months | |||
Three or More
|
12 months | 100% of the Short Term Incentive Plan base award for the full fiscal year in which the termination occurs | 12 months |
To the extent permitted under Code Section 409A, the sum of applicable Base Salary and Incentive
Compensation shall be divided into equal monthly payments and paid to the Executive over the
applicable Payout Period shown in the table above, depending on the Executive’s years of service at
the time of termination.
(b) Life and Group Disability Insurance. If and to the extent that the Company’s
plans in effect from time to time permit such coverage and to the extent permitted under Code
Section 409A, the Company shall continue to provide Executive with group life and disability
insurance coverage for the applicable Payout Period described above in (a) following termination at
coverage levels and rates equal to those applicable to Executive immediately prior to such
termination or, if different, as provided to other executive level employees during such applicable
period.
(c) Medical Insurance. Upon termination of employment, the Executive shall be
entitled to all COBRA continuation benefits available under the Company’s group health plans to
similarly situated employees. To the extent permitted under Code Section 409A, during the
applicable Payout Period, the Company shall provide such COBRA continuation benefits to the
Executive at the active employee rates similarly situated employees must pay for such benefits.
Upon the expiration of such Payout Period, the Executive will be responsible for paying the full
COBRA premiums for the remaining COBRA continuation period.
(d) Offset. To the extent permitted by COBRA and the Health Insurance Portability and
Accountability Act of 1996, as amended (“HIPAA”), any fringe benefits received by Executive in
connection with any other employment accepted by Executive that are reasonably comparable, even if
not necessarily as beneficial to Executive, to the fringe benefits then being provided by the
Company pursuant to paragraphs (b) and (c) of this Section 5, shall be deemed to be the equivalent
of such benefits, and shall terminate the Company’s responsibility to continue providing the fringe
benefits package, taken as a whole, then being provided by the Company pursuant to paragraphs (b)
and (c) of this Section 5. The Company agrees that if Executive’s employment with the Company is
terminated, Executive shall have no duty to mitigate damages.
(e) General Release. Acceptance by Executive of any amounts pursuant to this Section
5 shall constitute a full and complete release by Executive of any and all claims Executive may
have against the Company, its officers, directors and affiliates, including, but not limited to,
claims he might have relating to Executive’s employment with the Company and cessation thereof;
provided, however, that there may properly be excluded from the scope of such general release the
following:
(i) claims that Executive may have against the Company for reimbursement of
ordinary and necessary business expenses incurred by him during the course of his
employment;
(ii) claims that may be made by the Executive for payment of Base Salary,
bonuses, fringe benefits, stock upon vesting of incentive stock awards, stock upon
exercise of stock options properly due to him, or other amounts or benefits due to him
under this Agreement;
(iii) claims respecting any matters for which the Executive is entitled to be
indemnified under the Company’s Articles of Incorporation or By-laws or applicable
law, respecting third party claims asserted or third party litigation pending or
threatened against the Executive; and
(iv) any claims prohibited by applicable law from being included in the release.
A condition to Executive’s receipt of any amounts pursuant to this Section 5 shall be Executive’s
execution and delivery of a general release as described above. In exchange for such release, the
Company shall, if Executive’s employment is terminated without Cause, provide a release to
Executive, but only with respect to claims against Executive that Executive identifies in writing
to the Company at the time of such termination.
6. Effect of Change of Control.
(a) If within one (1) year following a “Change of Control” (as hereinafter defined), Executive
terminates his employment with the Company for “Good Reason” (as hereinafter defined) or the
Company terminates Executive’s employment for any reason other than Cause, death or disability (as
defined in Section 4(e)), the Company shall pay to Executive in a lump sum within thirty (30) days
following Executive’s termination of employment: (i) an amount equal to one times the Executive’s
Base Salary as of the date of termination; and (ii) an amount equal to the full amount of the cash
Short-Term Incentive Compensation base during the fiscal year in which the termination occurs. In
addition, the Company shall provide the Executive with out-placement assistance. In addition, to
the extent permitted under the terms of the various plans, the Company shall continue to provide
the Executive with coverage under the Company’s various welfare and benefit plans, including
retirement and group healthcare, dental and life in which Executive participates at the time of
termination, for the period equal to twelve (12) months from the date of termination at coverage
levels and rates substantially equal to those applicable to Executive immediately prior to such
termination.
(b) “Change of Control” means, with respect to the Executive, a “change in ownership,” a
“change in effective control,” or a “change in the ownership of substantial assets” of a
corporation as described in Treasury Regulations Section 1.409A-3(g)(5) (which events are
collectively referred to herein as “Change of Control events”) after the date of this Agreement.
To constitute a Change of Control with respect to the Executive, the Change of Control event must
relate to a change in control of Delta Apparel, Inc.
(i) A “change in ownership” of a corporation occurs on the date that any one
person, or more than one person acting as a group, acquires ownership of stock of the
corporation that, together with stock held by such person or group, constitutes more
than 50 percent of the total fair market value or total voting power of the stock of
such corporation. However, if any one person, or more than one person acting as a
group, is considered to own more than 50 percent of the total fair market value or
total voting power of the stock of a corporation, the acquisition of additional stock
by the same person or persons is not considered to cause a change in ownership of the
corporation (or to cause a change in the effective control of the corporation (within
the meaning of paragraph (ii) below)).
(ii) Notwithstanding that a corporation has not undergone a change in ownership
under paragraph (i) above, a “change in effective control” of a corporation occurs on
the date that either:
(A) Any one person, or more than one person acting as a group, acquires (or has
acquired during the 12-month period ending on the date of the most recent acquisition
by such person or persons) ownership of stock of the corporation possessing 35 percent
or more of the total voting power of the stock of such corporation; or
(B) A majority of members of the corporation’s board of directors is replaced
during any 12-month period by directors whose appointment or election is not endorsed
by a majority of the members of the corporation’s board of directors prior to the date
of the appointment or election.
For purposes of this paragraph (ii), the term corporation refers solely to the
relevant corporation identified in the opening paragraph of this Section 6(b) for
which no other corporation is a majority shareholder.
(c) “Good Reason” shall mean any of the following actions taken by the Company without the
Executive’s written consent after a Change of Control:
(i) the assignment to the Executive by the Company of duties inconsistent with,
or the reduction of the powers and functions associated with, the Executive’s
position, duties, responsibilities and status with the Company immediately prior to a
Change of Control or Potential Change of Control (as defined below), or an adverse
change in Executive’s titles or offices as in effect immediately prior to a Change of
Control or Potential Change of Control, or any removal of the Executive from or any
failure to re-elect Executive to any of such positions, except in connection with the
termination of his employment for disability (as provided in Section 4(e)) or Cause or
as a result of Executive’s death, except to the extent that a change in duties relates
to the elimination of responsibilities attendant to the Company’s no longer being a
publicly traded company;
(ii) a reduction by the Company in the Executive’s Base Salary as in effect on
the date of a Change of Control or Potential Change of Control, or as the same may be
increased from time to time during the term of this Agreement;
(iii) the Company shall require the Executive to be based anywhere other than at
or within a 25-mile radius of the Company’s principal executive offices or the
location where the Executive is based on the date of a Change of Control or Potential
Change of Control, or if Executive agrees to such relocation, the Company fails to
reimburse the Executive for moving and all other expenses reasonably incurred in
connection with such move;
(iv) a significant increase in Executive’s required travel on behalf of the
Company;
(v) the Company shall fail to continue in effect any Company-sponsored plan or
benefit that is in effect on the date of a Change of Control or Potential Change of
Control (other than the Incentive Stock Award Plan or the Company’s stock option
plan) and pursuant to which Executive has received awards or benefits and that
provides (A) incentive or bonus compensation, (B) fringe benefits such as vacation,
medical benefits, life insurance and accident insurance, (C) reimbursement for
reasonable expenses incurred by the Executive in connection with the performance of
duties with the Company, or (D) retirement benefits such as a Internal Revenue Code
Section 401(k) plan, except to the extent that such plans taken as a whole are
replaced with substantially comparable plans;
(vi) any material breach by the Company of any provision of this Agreement which
is not cured within ten (10) days of the Company’s receipt from Executive of notice
thereof; and
(vii) any failure by the Company to obtain the assumption of this Agreement by
any successor or assign of the Company effected in accordance with the provisions of
Section 13.
(d) “Potential Change of Control” shall mean the date as of which (i) the Company enters into
an agreement the consummation of which, or the approval by shareholders of which, would constitute
a Change of Control; (ii) proxies for the election of directors of the Board of Directors of the
Company are solicited by anyone other than the Company which solicitation, if successful, would
result in a Change of Control; (iii) any person (including, but not limited to, any individual,
partnership, joint venture, corporation, association or trust) publicly announces an intention to
take or to consider taking actions which, if consummated, would constitute a Change of Control; or
(iv) any other event occurs which is deemed to be a Potential Change of Control by the Board of
Directors of the Company and the Board adopts a resolution to the effect that a Potential Change of
Control has occurred.
(e) In the event that (i) Executive would otherwise be entitled to the compensation and
benefits described in Section 5 or 6(a) hereof (“Compensation Payments”), and (ii) the Company
determines, based upon the advice of tax counsel, that, as a result of such Compensation Payments
and any other benefits or payments required to be taken into account under the Internal Revenue
Code of 1986, as amended (the “Code”), Section 280G(b)(2) (collectively,“Parachute Payments”), any
of such Parachute Payments would be reportable by the Company as an “excess parachute payment”
under Code Section 280G, such Compensation Payments shall be reduced to the extent necessary to
cause the aggregate present value (determined in accordance with Code Section 280G and applicable
regulations promulgated thereunder) of the Executive’s Parachute Payments to equal 2.99 times the
“base amount” as defined in Code Section 280G(b)(3) with respect to such Executive. However, such
reduction in the Compensation Payments shall be made only if, in the opinion of such tax counsel,
it would result in a larger Parachute Payment to the Executive than payment of the unreduced
Parachute Payments after deduction in each case of tax imposed on and payable by the Executive
under Section 4999 of the Code (“Excise Tax”). The value of any non-cash benefits or any deferred
payment or benefit for purposes of this paragraph shall be determined by a firm of independent
auditors selected by the Company.
(f) The parties hereto agree that the payments provided under Section 6(a) above are
reasonable compensation in light of Executive’s services rendered to the Company and that subject
to paragraph (e) above neither party shall assert that the payment of such benefits constitutes an
“excess parachute payment” within the meaning of Section 280G(b)(1) of the Code.
(g) Unless the Company determines that any Parachute Payments made hereunder must be reported
as “excess parachute payments” in accordance with Section 6(e) above, neither party shall file any
return taking the position that the payment of such benefits constitutes an “excess parachute
payment” within the meaning of Section 280G(b)(1) of the Code.
7. Non-Competition. Executive agrees that during the Term and for a period of twelve
months from the date of the termination of Executive’s employment with the Company pursuant to
Sections 4(b), 4(c), 4(d), 4(e) or 6 herein or for any other reason that results in the Executive
being entitled to the benefits described in Section 5 or Section 6, he will not, directly or
indirectly, compete with the Company by providing to any company that is in a “Competing Business”
services substantially similar to the services provided by Executive at the time of termination.
Competing Business shall be defined as any business that engages, in whole or in part, in the
manufacturing or marketing of activewear apparel in the United States of America (the “Restricted
Territory”), and Executive’s employment function or affiliation is directly or indirectly in such
business of activewear apparel manufacturing or marketing.
8. Non-Solicitation. For a period of two years after the later of the expiration of
the Term or the termination or cessation of his employment with the Company for any reason
whatsoever, Executive shall not, on his own behalf or on behalf of any other person, partnership,
association, corporation, or other entity, (a) solicit or in any manner attempt to influence or
induce any employee of the Company or its subsidiaries or affiliates (known by the Executive to be
such) to leave the employment of the Company or its subsidiaries or affiliates (other than through
general advertisements not directed at any particular employee or group of employees), nor shall he
use or disclose to any person, partnership, association, corporation or other entity any
information obtained while an employee of the Company concerning the names and addresses of the
Company’s employees, or (b) solicit, entice or induce any customer or supplier of the Company (or
any actively sought customer or supplier of the Company) at the time of such expiration or
termination for or on behalf of any Competing Business in the Restricted Territory.
9. Non-Disclosure of Trade Secrets. During and prior to the Term of this Agreement,
Executive has had access to and became familiar with and will have access to and become familiar
with various trade secrets and proprietary and confidential information of the Company and its
affiliates, including, but not limited to, processes, computer programs, compilations of
information, records, sales procedures, customer requirements, pricing techniques, customer lists,
methods of doing business and other confidential information (collectively, referred to as “Trade
Secrets”) which are owned by the Company and/or its affiliates and regularly used in the operation
of its or their business, and as to which the Company and/or its affiliates take precautions to
prevent dissemination to persons other than certain directors, officers and employees. Executive
acknowledges and agrees that the Trade Secrets (1) are secret and not known in the industry; (2)
give the Company and/or its affiliates an advantage over competitors who do not know or use the
Trade Secrets; (3) are of such value and nature as to make it reasonable and necessary to protect
and preserve the confidentiality and secrecy of the Trade Secrets; and (4) are valuable, special
and unique assets of the Company and/or its affiliates, the disclosure of which could cause
substantial injury and loss of profits and goodwill to the Company and/or its affiliates.
Executive may not use in any way or disclose any of the Trade Secrets, directly or indirectly,
either during the Term or at any time after the expiration of the Term or the termination of
Executive’s employment with the Company for any reason whatsoever, except as required in the course
of his employment under this Agreement, as required in connection with a judicial or administrative
proceeding, or if the information becomes public knowledge other than as a result of an
unauthorized disclosure by the Executive. All files, records, documents, information, data and
similar items relating to the business of the Company and/or its affiliates, whether prepared by
Executive or otherwise coming into his possession, will remain the exclusive property of the
Company and/or its affiliates (as the case may be) and may not be removed from the premises of the
Company under any circumstances without the prior written consent of the Board of Directors of the
Company and/or its affiliates (as the case may be) (except in the ordinary course of business
during Executive’s period of active employment under this Agreement), and in any event must be
promptly delivered to the Board of Directors of the Company upon termination of Executive’s
employment with the Company. Executive agrees that upon his receipt of any subpoena, process or
other request to produce or divulge, directly or indirectly, any Trade Secrets to any entity,
agency, tribunal or person, Executive shall timely notify and promptly hand deliver a copy of the
subpoena, process or other request to the Board of Directors of the Company. For this purpose,
Executive irrevocably nominates and appoints the Company (including any attorney retained by the
Company), as his true and lawful attorney-in-fact, to act in Executive’s name, place and stead to
perform any act that Executive might perform to defend and protect against any disclosure of any
Trade Secrets. The rights granted to the Company and/or its affiliates in this Section 9 are
intended to be in addition to and not in replacement of any protection of trade secrets provided by
equity, any statute, judicially created law or other agreement.
10. Remedies. In the event that Executive violates any of the provisions of Sections
7, 8 or 9 hereof (the “Protective Covenants”) or fails to provide the notice required by Section
4(d) hereof, in addition to any other remedy that may be available at
law, in equity or hereunder, the Company shall be entitled to receive from Executive the profits,
if any, received by Executive upon exercise of any Company granted stock options or incentive stock
awards or upon lapse of the restrictions on any grant of restricted stock to the extent such
options or rights were exercised, or such restrictions lapsed, subsequent to the commencement of
the six-month period prior to the termination of Executive’s employment. In addition, Executive
acknowledges and agrees that any breach of a Protective Covenant by him will cause irreparable
damage to the Company and/or its affiliates, the exact amount of which will be difficult to
determine, and that the remedies at law for any such breach will be inadequate. Accordingly,
Executive agrees that, in addition to any other remedy that may be available at law, in equity or
hereunder, the Company, and/or its affiliates shall be entitled to specific performance and
injunctive relief, without posting bond or other security, to enforce or prevent any violation of
any of the Protective Covenants by him.
11. Severability. The parties hereto intend all provisions of this Agreement to be
enforced to the fullest extent permitted by law. The provisions of this Agreement are severable.
The covenants on the part of the Executive contained in the Protective Covenants shall be construed
as independent covenants and agreements of the Executive, independently supported by good and
adequate consideration, shall be construed independently of the other provisions in this Agreement
and shall survive this Agreement. The existence of any claim or cause of action of Executive
against the Company or any of its affiliates, whether predicated on this Agreement or otherwise,
shall not constitute a defense to the enforcement by the Company or its affiliates of the covenants
of Executive contained in this Agreement. The parties in no way intend to include a provision that
contravenes public policy. Therefore, if any of the provisions, clauses, sentences, or paragraphs,
or portions (“provisions”) of this Agreement is unlawful, against public policy, or otherwise
declared void or unenforceable, such provision shall be deemed excluded from this Agreement, which
shall in all other respects remain in effect. Furthermore, in lieu of such illegal, invalid or
unenforceable provision, there shall be added as part of this Agreement a provision as similar in
its terms to such illegal, invalid or unenforceable provision as may be possible and be legal,
valid and enforceable. If any Court should construe any portion of this Agreement to be too broad
to prevent enforcement to its fullest extent then such portion shall be enforced to the maximum
extent that the Court finds reasonable and enforceable.
12. Compliance With Section 409A. Notwithstanding any other provision of this
Agreement, to the extent applicable, this Agreement is intended to comply with Section 409A of the
Code and the regulations (or similar guidance) thereunder. To the extent any provision of this
Agreement is contrary to or fails to address the requirements of Section 409A of the Code, this
Agreement shall be construed and administered as necessary to comply with such requirements.
13. Miscellaneous.
a. Notices. Any notices, consents, demands, requests, approvals and other
communications to be given under this Agreement by either party to the other must be in writing and
must be either (i) personally delivered, (ii) mailed by registered or certified mail, postage
prepaid with return receipt requested, (iii) delivered by reputable overnight express delivery
service or reputable same-day local courier service, or (iv) delivered by telex or facsimile
transmission, with confirmed receipt, to the address set forth below, or to such other address as
may be designated by the parties from time to time in accordance with this Section 13(a):
If to the Company:
Delta Apparel, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Vice President of Human Resources
Fax No.: (000) 000 0000
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Vice President of Human Resources
Fax No.: (000) 000 0000
If to Executive:
Xx. Xxxxxx X. Xxxxxxxxx
000 Xxxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Xx. Xxxxxx X. Xxxxxxxxx
000 Xxxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Notices delivered personally or by overnight express delivery service or by local courier
service are deemed given as of actual receipt. Mailed notices are deemed given three (3) business
days after mailing. Notices delivered by telex or facsimile transmission are deemed given upon
receipt by the sender of the answer back (in the case of a telex) or transmission confirmation (in
the case of a facsimile transmission).
b. Entire Agreement. This Agreement supersedes any and all other agreements, either
oral or written, between the parties with respect to the subject matter of this Agreement and
contains all of the covenants and agreements between the parties with respect to the subject matter
of this Agreement.
c. Modification. No change or modification of this Agreement is valid or binding upon
the parties, nor will any waiver, termination or discharge of any term or condition of this
Agreement be so binding, unless confirmed in writing and signed by the parties to this Agreement.
d. Governing Law and Venue. The parties acknowledge and agree that this Agreement and
the obligations and undertakings of the parties under this Agreement will be performable in
Georgia. This Agreement is governed by, and construed in accordance with, the laws of the State of
Georgia without giving consideration to the conflict of laws provisions thereof. If any action is
brought to enforce or interpret this Agreement, the parties consent to the jurisdiction and venue
of the Federal District Court for the Northern District of Georgia and any state or superior court
located in Xxxxxx or Gwinett Counties, Georgia.
e. Enforcement. Executive agrees that upon Executive’s violation or threatened
violation of any of the provisions of this Agreement, the Company shall, in addition to any other
rights and remedies available to it, at law, in equity, or otherwise, be entitled to specific
performance and injunctive relief including, without limitation, an injunction to be issued by any
court of competent jurisdiction enjoining and restraining Executive from committing any violation
or threatened violation of the provisions of this Agreement and Executive consents to the issuance
of such injunction without the necessity of bond or other security in the event of a breach or
threatened breach by him of this Agreement. Furthermore and notwithstanding anything to the
contrary in this Agreement, the Company shall, in addition to any other rights or remedies
available to it, at law, in equity, or otherwise, be entitled to reimbursement of court costs,
reasonable attorneys’ fees, and any other expenses reasonably incurred by it or its affiliates as a
result of a breach or threatened breach of this agreement by Executive.
f. Counterparts. This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement, and all of which, when taken
together, shall be deemed to constitute one and the same agreement. The exchange of copies of this
Agreement and of signature pages by facsimile transmission shall constitute effective execution and
delivery of this Agreement as to the parties and may be used in lieu of the original agreement for
all purposes. Signatures of the parties transmitted by facsimile shall be deemed to be their
original signatures for any purpose whatsoever.
g. Costs. Except as provided in Section 13(e) above or except as provided below, if
any action at law or in equity is necessary to enforce or interpret the terms of this Agreement,
each party shall bear its own costs and expenses (including, without limitation, attorneys’ fees);
provided, however, that in the event Executive incurs costs or expenses in connection with
successfully enforcing this Agreement following a Change of Control, the Company shall reimburse
the Executive for all such reasonable costs and expenses (including, without limitation, attorneys’
fees).
h. Estate. If Executive dies prior to the expiration of the term of employment or
during a period when monies are owing to him, any monies that may be due him from the Company under
this Agreement as of the date of his death shall be paid to his estate as and when otherwise
payable.
i. Assignment. The rights, duties and benefits to Executive hereunder are personal to
him, and no such right, duty or benefit may be assigned by him without the prior written consent of
the Company. The rights and obligations of the Company shall inure to the benefit and be binding
upon it and its successors and assigns, which assignment shall not require the consent of
Executive.
j. Binding Effect. This Agreement is binding upon and shall inure to the benefit of
the parties hereto, their respective executors, administrators, successors, personal
representatives, heirs and assigns permitted under subsection 13(i) above.
k. Third-Party Beneficiaries. Nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person or entity (other than affiliates of the Company
as provided herein) any rights, benefits or remedies of any nature whatsoever under or by reason of
this Agreement.
l. Waiver of Breach. The waiver by the Company or Executive of a breach of any
provision of this Agreement by Executive or the Company may not operate or be construed as a waiver
of any subsequent breach.
m. Construction. The parties agree that this Agreement was freely negotiated among
the parties and that Executive has had the opportunity to consult with an attorney in negotiating
its terms. Accordingly, the parties agree that this Agreement shall not be construed in favor of
any party or against any party. The parties further agree that the headings and subheadings are
for convenience of the parties only and shall not be given effect in the construction of this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
written.
| DELTA APPAREL, INC. | ||||||
| /s/ Delta Apparel, Inc. | ||||||
| By: | /s/ Xxxxxx X. Xxxxxx
|
|||||
| Name: Xxxxxx X. Xxxxxx | ||||||
| Title: Vice President and Corporate Secretary | ||||||
| “Executive” | ||||||
| /s/ Xxxxxx X. Xxxxxxxxx | ||||||
| Name: Xxxxxx X. Xxxxxxxxx | ||||||
| Title: Chairman of the Board of Directors and Chief Executive Officer |
||||||
