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EXHIBIT 10.3
TAX SHARING AGREEMENT
This TAX SHARING AGREEMENT (this "Agreement") is made as of September
18, 1998 by and between FORWARD AIR CORPORATION, a Tennessee corporation f/k/a
Landair Services, Inc. ("FAF"), and LANDAIR CORPORATION, a Tennessee corporation
("LAC").
WHEREAS, FAF and LAC have entered into a Distribution Agreement dated
as of the date hereof (the "Distribution Agreement");
WHEREAS, pursuant to the Distribution Agreement all the issued and
outstanding common stock of LAC will be distributed by FAF (pro rata) to the
holders of FAF's common stock (the "Distribution"); and
WHEREAS, the parties hereto desire to provide for the payment of tax
liabilities and entitlement to tax refunds for the taxable periods ending
before, on or after the date of the Distribution, to allocate responsibility and
provide for cooperation in the preparation and filing of tax returns with
respect to such taxable periods, and to provide for certain other related
matters.
NOW, THEREFORE, FAF, on behalf of itself and the FAF Group (as
hereinafter defined), and LAC, on behalf of itself and the LAC Group (as
hereinafter defined), in consideration of the mutual covenants contained herein,
agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and the
plural forms of the terms defined):
"CODE" means the Internal Revenue Code of 1986, as amended, or any
successor thereto and the regulations promulgated thereunder.
"DISTRIBUTION DATE" means the date of the Distribution. For all
purposes of this Agreement, the Distribution shall be deemed effective as of the
close of business on the Distribution Date.
"ESTIMATED TAX OR TAXES" means the periodic (quarterly or monthly)
payment of income or franchise taxes (federal, state or local) required to be
made for 1998 including any payment required to be made with an extension to
file any Tax Return.
"FAF BUSINESSES" means the present, former and future subsidiaries,
divisions and businesses of any member of the FAF Group, other than the LAC
Businesses.
"FAF GROUP" means FAF and its present and future subsidiaries, other
than members of the LAC Group.
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"FINAL DETERMINATION" shall mean the final resolution of liability for
any Tax for a taxable period, (i) by IRS Form 870-AD (or any successor forms
thereto), on the date of acceptance by or on behalf of the IRS, or by a
comparable form under the laws of other jurisdictions; except that a Form 870-AD
or comparable form that reserves (whether by its terms or by operation of law)
the right of the taxpayer to file a claim for refund and/or the right of the
taxing authority to assert a further deficiency shall not constitute a Final
Determination with respect to the subject matter reserved; (ii) by a decision,
judgment, decree, or other order by a court of competent jurisdiction, which has
become final and unappealable; (iii) by closing agreement or accepted offer in
compromise under Section 7121 or 7122 of the Code, or comparable agreements
under the laws of other jurisdictions; (iv) by any allowance of a refund or
credit in respect of an overpayment of Tax, but only after the expiration of all
periods during which such refund may be recovered (including by way of offset)
by the Tax-imposing jurisdiction; or (v) by any other final disposition,
including by reason of the expiration of the applicable statute of limitations
or by mutual agreement of the parties.
"IRS" means the Internal Revenue Service.
"LAC BUSINESSES" means the present, former and future subsidiaries,
divisions and businesses of any member of the LAC Group which are not, or are
not contemplated by the Distribution Agreement to be, part of the FAF Group
immediately after the Distribution.
"LAC GROUP" means LAC and all former, present and future subsidiaries
of LAC and shall include any business, division or subsidiary which carried on a
LAC Business on or before the Distribution Date.
"RESTRUCTURING TAXES" means any Taxes resulting from or related to the
Distribution, including, without limitation, any Taxes imposed pursuant to or as
a result of Code Section 311.
"TAX" means any of the Taxes.
"TAXES" means all forms of taxation, whenever created or imposed, and
whether of the United States of America or elsewhere, and whether imposed by a
local, municipal, governmental, state, federation or other body, and without
limiting the generality of the foregoing, shall include income, alternative
minimum, superfund, sales, use, ad valorem, gross receipts, value added,
franchise, transfer, recording, withholding, payroll, employment, excise,
occupation, premium or property taxes, together with any related interest,
penalties and additions to tax, or additional amounts imposed by any taxing or
other governmental authority (domestic or foreign) upon the LAC Group, the FAF
Group or any of their respective members or subsidiaries or divisions or
branches or any combination thereof.
"TAX ATTRIBUTE" shall mean any net operating loss, capital loss, or tax
credit allowed by the Internal Revenue Code or equivalent state statute or local
ordinance; including without limitation, alternative minimum tax credits,
foreign tax credits and general business tax credits.
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"TAX BENEFIT" means the amount of the decrease in the liability for
Taxes resulting from any increase or decrease in any item, including, but not
limited to, any item of income or deduction, gain or loss or tax credit.
"TAX DETRIMENT" means the amount of the increase in the liability for
Taxes resulting from any increase or decrease in any item, including, but not
limited to, any item of income or deduction, gain or loss, or tax credit.
"TAX RETURN" means any return, filing, questionnaire or other document
filed or required to be filed, including amended returns that may be filed, for
any period with any taxing or governmental authority (whether domestic or
foreign) in connection with any Tax or Taxes (whether or not a payment is
required to be made with respect to such filing).
ARTICLE II
PREPARATION AND FILING OF TAX RETURNS
2.1 MANNER OF PREPARATION; ELECTIONS. All Tax Returns filed after the
Distribution Date shall be prepared on a basis which does not have an adverse
effect on the elections, accounting methods, conventions, closing agreements and
principles of taxation used in any Tax Return filed for any taxable period
ending on or before the Distribution Date, and shall be filed on a timely basis
by the party responsible for such filing under this Agreement. Subject to the
provisions of this Agreement, all decisions relating to the preparation and
filing of Tax Returns and any audit or other review of such Tax Returns shall be
made in the sole discretion of the party responsible under this Agreement for
such filing. Anything herein to the contrary notwithstanding, without the prior
written consent of FAF, which consent shall not be unreasonably withheld, no
member of the LAC Group shall carry back to any taxable period beginning before
the Distribution Date any Tax Attribute arising in any taxable period beginning
on or after the Distribution Date. To the extent any such carryback is not so
consented to by FAF, then FAF shall be entitled to retain for itself any refund
or other benefit obtained from such carryback filed by LAC. LAC shall promptly
reimburse FAF for the amount, if any, by which any Tax Detriment incurred by the
FAF Group or any member thereof as a result of such carryback exceeds the Tax
Benefit(s) to the FAF Group or any member thereof as a result of such carryback,
upon receipt of documentation detailing such Tax Detriment(s) within fifteen
(15) days of receipt of documentation, after which any unpaid amount will accrue
interest at the rate for income tax deficiencies specified in Section 3.1. All
Tax Attributes of the FAF Group and LAC Group will be allocated among the FAF
Group and LAC Group in accordance with the regulations promulgated pursuant to
Section 1502 of the Code (the "Consolidated Return Regulations") and, to the
extent applicable, other provisions of the Code and the regulations promulgated
thereunder (and analogous provisions of state, local or foreign law).
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2.2 PREPARATION AND FILING OF AND ELECTIONS WITH RESPECT TO
PRE-DISTRIBUTION TAX RETURNS.
(a) Consolidated Federal Income Tax Returns. All consolidated federal
income Tax Returns which include a member of the FAF Group and the LAC Group
that are required to be filed for periods beginning before the Distribution Date
shall be prepared and filed by FAF. LAC shall, for each of such aforesaid
taxable periods for which it or any member of the LAC Group is includible in the
consolidated federal income Tax Return of the FAF Group, provide FAF with a
true, complete, and correct (i) separate federal income Tax Returns for LAC and
each member of the LAC Group together with accompanying computations of the
separate federal income Tax liabilities of LAC and each member of the LAC Group
and (ii) a reconciliation of book income to federal taxable income for LAC and
each member of the LAC Group. LAC shall use its best efforts to provide FAF with
such Returns and computations on or before the first day of the sixth month
following the end of the period to which such Returns and computations relate,
but in any event LAC shall provide such Returns and computations no later than
the fifteenth day of the sixth month following the end of the period to which
such Returns and computations relate. FAF shall notify LAC of the intended
filing date of its then due consolidated federal income Tax Return and LAC shall
pay FAF at least seven (7) days prior to such filing date the amount of total
federal income Tax liability, including without limitation, any alternative
minimum tax liability, shown on the above-referenced deemed consolidated federal
income Tax Returns for the members of the LAC Group includible in FAF's
consolidated federal income Tax Return, reduced by all Estimated Tax payments
theretofore made by LAC or any LAC Group member to FAF on account of such Tax
liability, or if such Estimated Tax payments in the aggregate exceed the federal
income Tax liability of LAC and each member of the LAC Group, FAF shall pay such
excess to LAC within thirty (30) days of the filing by FAF of the consolidated
federal income Tax Return with respect to which such overpayment relates.
Anything herein to the contrary notwithstanding, LAC for itself and each member
of the LAC Group shall calculate and shall remit to FAF at least seven (7) days
prior to the due date of each FAF Estimated Tax payment for 1998 the Estimated
Tax liability, attributable to LAC and each member of the LAC Group on a
consolidated basis for the short period beginning on January 1, 1998 and ending
on the Distribution Date. FAF agrees to permit LAC Group to review and comment
on each Tax Return prior to filing and shall make such revisions to such Tax
Returns as reasonably requested by LAC.
(b) Combined or Consolidated State or Local Income or Franchise Tax.
The provisions of Section 2.2(a) shall apply to the applicable filings of all
combined or consolidated state or local income or franchise Tax Returns which
include a member of the FAF Group and a member of the LAC Group that are
required to be filed for periods beginning before the Distribution Date. The Tax
savings, if any, resulting from filing combined or consolidated returns for 1998
will be allocated to LAC in a manner consistent with the most recent period. If
there should be adjustments to any combined or consolidated returns, or to prior
years federal returns as a result of an audit, any tax savings that were
previously credited for the period will be recalculated and the difference
between the tax savings that were previously credited and the recomputed tax
savings will be charged back
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to LAC on the same basis as the savings have been allocated. No tax savings will
be allocated to LAC for the year 1998 or thereafter.
(c) Other Tax Returns. All Tax Returns (other than Tax Returns
described in Sections 2.2(a) and (b)) which include or are filed with respect to
a member of the FAF Group or the LAC Group that are required to be filed for
periods beginning before the Distribution Date shall be filed by the member of
the FAF Group or the LAC Group, as the case may be, which filed the
corresponding Tax Return for the most recent period for which such Tax Return
has been filed, or, if no such corresponding Tax Return has been filed, by the
appropriate member in accordance with applicable law or custom. In the case of
such Tax Returns filed by a member of the FAF Group, LAC shall be liable for and
pay to FAF the portion of the Tax liability on such Tax Returns attributable to
LAC Group members, at the time and in the amount determined in accordance with
past practice. In the case of such Returns filed by a member of the LAC Group,
FAF shall be liable for and pay to LAC the portion of the Tax liability on such
Returns attributable to FAF Group members, at the time and in the amount
determined in accordance with past practice.
(d) Apportionment of Tax Attributes. If all or a portion of any Tax
Attribute arising in any taxable period beginning before the Distribution Date,
is apportioned to a separate return year of LAC pursuant to any Code section (or
equivalent state or local law or regulations), then LAC shall pay to FAF the Tax
Benefit related to the Tax Attribute so apportioned.
(e) Certain Costs and Expenses. LAC or the LAC Group shall reimburse
FAF and the FAF Group for the LAC Group's portion of the costs associated with
the preparation and filing of Tax Returns by FAF pursuant to this Section 2.2.
2.3 FILING OF POST-DISTRIBUTION TAX RETURNS. All Tax Returns and Taxes
for periods beginning on or after the Distribution Date shall be the
responsibility of the FAF Group if such Tax Returns or Taxes relate to FAF
Businesses, and shall be the responsibility of the LAC Group if such Tax Returns
or Taxes relate to LAC Businesses.
2.4 CERTIFICATION. Each Tax Return and computation of tax liability
required to be provided to FAF by LAC and each member of the LAC Group pursuant
to Section 2.2 hereof shall be accompanied by a statement signed by the Chief
Financial Officer of LAC to the effect that such officer has reviewed for
completeness and accuracy the Tax Return and computation of the Tax liability
and the documentation in support thereof and has determined that such Tax Return
and computation properly reflect the taxable income (or loss), Tax liability and
credits of the entity or entities, as the case may be, to which such Tax Return
and computation relate for the period covered thereby.
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ARTICLE III
DEFICIENCIES AND REFUNDS OF TAXES
3.1 PAYMENT OF DEFICIENCIES BY LAC. If any adjustments are made by any
taxing authority with respect to any Tax Return of FAF (or any member of the FAF
Group) in which any member of the LAC Group is included for taxable periods
beginning before the Distribution Date, then to the extent that such adjustments
either increase the net taxable income, reduce the net taxable loss or decrease
the tax credits of any member of the LAC Group and result in a greater Tax (net
of any future tax benefit resulting from such Tax or Tax liability) for such LAC
Group member or any FAF Group member (in either case without regard to any
offsetting adjustments to other members of the FAF Group, other than a member of
the LAC Group), LAC and each other member of the LAC Group shall be liable for
such increases in Taxes (net of any future tax benefit resulting from such Taxes
or Tax liabilities). If any member of the LAC Group shall have any liability as
a result of this Section 3.1, LAC shall pay to FAF, hold FAF harmless and
indemnify FAF for any such Tax liability, costs and attorneys fees, and the
amount thereof shall be paid by LAC to FAF within ten (10) days of the receipt
by LAC of written notice of such liability, together with a computation of the
amount due and supporting documentation in such detail as LAC may reasonably
request to verify the computation of the amount due. Any such required payment
not made within such ten (10) day period shall thereafter bear interest until
paid at the then most recently published rate of interest charged by the IRS on
income tax deficiencies of large corporations pursuant to Code Sections
6621(a)(2) and (c) (1).
3.2 PAYMENT OF REFUNDS TO LAC. If any adjustments are made by any
taxing authority with respect to any Tax Return of FAF (or any member of the FAF
Group) in which any member of the LAC Group is included for any taxable period
beginning before the Distribution Date, then to the extent that such adjustments
either (a) decrease the Tax liability attributable to any member of the LAC
Group and result in a Tax Benefit to FAF or any member of the FAF Group, or (b)
are attributable to a member of the LAC Group and result in a reduced Tax
liability for FAF or any member of the FAF Group (in either case without regard
to any offsetting adjustments to other members of the FAF Group, other than a
member of the LAC Group), then FAF shall remit to LAC any refunds of Taxes
received by or credited to it as a result of the adjustments attributable to a
member of the LAC Group. FAF shall pay any amounts due from it to LAC as a
result of this Section 3.2 within ten (10) days of its receipt of the relevant
refund or credit with respect thereto from the IRS or any state or other
governmental unit, as the case may be. Any such required payment not made within
such ten (10) day period shall thereafter, bear interest until paid at the then
most recently published rate at which the IRS pays interest on tax refunds of
large corporations pursuant to Code Section 6621(a)(1). Such payments shall be
accompanied by a computation of the amount due and supporting documentation in
such detail as LAC may reasonably request to verify the computation of the
amount due. Anything herein to the contrary notwithstanding, except as provided
in this Section 3.2, no member of the LAC Group shall be entitled to any payment
or benefit as a result of the receipt of any Tax refund received by any member
of the FAF Group except to the
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extent such refund is attributable to the overpayment of Estimated Taxes by the
LAC Group or any member thereof.
3.3 RESTRUCTURING TAXES. If as a result of any transaction, act or
omission occurring after the Distribution Date and involving the LAC Businesses,
or the stock, assets or liabilities (or any combination thereof) of any member
of the LAC Group, including, without limitation, a breach by any member of the
LAC Group of any representation made to the IRS in any request for rulings or
act or omission of any member of the LAC Group that causes any condition or
assumption upon which such a ruling is based to fail to be met or be correct, as
the case may be, either (a) the Distribution does not qualify as a
reorganization pursuant to Code Section 368(a)(1)(D) or a tax free distribution
pursuant to Code Section 355 or (b) any Restructuring Taxes are imposed upon or
paid by FAF or any other member of the FAF Group, then LAC shall pay to FAF and
shall indemnify and hold harmless each member of the FAF Group from and against
all Restructuring Taxes. Such payment and indemnification shall be made by LAC
promptly, but in any event within fifteen (15) days after written notice from
FAF, which notice shall be accompanied by a computation of the amounts due. Any
such required payment not made within such fifteen (15) day period shall
thereafter bear interest until paid at the then most recently published rate at
which the IRS charges interest on income tax deficiencies of large corporations
pursuant to Code Sections 6621(a)(2) and (c) (1).
ARTICLE IV
TAX AUDITS, TRANSACTIONS AND OTHER MATTERS
4.1 TAX AUDITS AND CONTROVERSIES.
(a) Federal, State, or Local Income or Franchise Taxes. Except as
otherwise provided in this Section 4.1, FAF shall have the exclusive authority
and obligation to represent each member of the LAC Group before the IRS or any
other governmental agency or authority or before any court with respect to any
matter affecting the federal, state or local income or franchise Tax liability
of any member of either the FAF Group or the LAC Group for any Tax period
beginning before the Distribution Date, in each such case (i) allowing
representatives of the LAC Group, including, without limitation, outside counsel
and consultants, to participate in good faith in all respects in all such Tax
proceedings affecting any member of the LAC Group, and (ii) acting in the best
interests of both the FAF Group and the LAC Group. Such representation shall
include, but shall not be limited to exclusive control over (i) any response to
any examination of federal, state or local income or franchise Tax Returns and
(ii) any contest or litigation through a Final Determination of any issue
included in any Tax Return that includes a member of the FAF Group, including,
but not limited to (A) whether and in what forum to conduct such contest, and
(B) whether and on what basis to settle such contest; except that FAF shall not
settle any claim, suit, action or proceeding in respect of which any member of
the LAC Group may incur any then known (by FAF) future Tax liability, or in
respect of which indemnity for federal, state or local income or franchise Taxes
may be sought hereunder against LAC or any member of the LAC Group without LAC's
consent, which consent
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shall not be unreasonably withheld. FAF shall give timely notice to LAC of any
inquiry, the assertion of any claim or the commencement of any suit, action or
proceeding in respect of which any member of the LAC Group may incur any then
known (by FAF) future Tax liability or in respect of which indemnity for
federal, state or local income or franchise Taxes may be sought under this
Agreement against LAC or any member of the LAC Group and will give LAC such
information with respect thereto as LAC may reasonably request. Anything in this
Section 4.1 or elsewhere in this Agreement to the contrary notwithstanding, if
LAC contests or litigates any federal, state or local income or franchise tax
issue in any forum, LAC shall pay and shall indemnify and hold harmless each
member of the FAF Group from any and all costs, expenses and/or liabilities of
any type or nature, including, without limitation, any federal income tax
liability (including interest and penalties thereon), that are incurred by or
imposed upon FAF or any member of the FAF Group which FAF or such FAF Group
member would not otherwise have incurred.
(b) Other Taxes. Except as otherwise provided in this Section 4.1, the
party responsible for filing any Tax Return (other than federal, state or local
income or franchise Tax Returns) pursuant to Section 2.2(c) hereof shall, at its
own expense, have the exclusive authority to represent each member of the FAF
Group and of the LAC Group before any governmental agency or authority or before
any court with respect to any matter affecting the Tax liability of any member
of either the FAF Group or the LAC Group for any Tax period beginning before the
Distribution Date in each case (i) allowing representatives of the other group
to participate in good faith in all respects in all such Tax proceedings
affecting any member of the other group, and (ii) acting in the best interests
of both the FAF Group and the LAC Group. Such representation shall include, but
shall not be limited to exclusive control over (i) any response to any
examination by the governmental authority of such Tax Returns and (ii) any
contest through a Final Determination of any issue included in any Tax Return
that includes a member of the LAC Group or the FAF Group, including, but not
limited to (A) whether and in what forum to conduct such contest, and (B)
whether and on what basis to settle such contest; except that FAF or any member
of the FAF Group shall not settle any claim, suit, action or proceeding in
respect of which indemnity for such Taxes may be sought hereunder against LAC or
any member of the LAC Group without LAC's consent, which consent shall not be
unreasonably withheld; and except that LAC or any member of the LAC Group shall
not settle any claim, suit, action or proceeding in respect of which indemnity
for such Taxes may be sought hereunder against FAF or any member of the FAF
Group without FAF's consent, which consent shall not be unreasonably withheld.
4.2 RETENTION OF BOOKS AND RECORDS. LAC and FAF each agrees to retain
and preserve in accessible and reproducible form all Tax Returns, related
schedules and work papers, and all accounting and computer records (in whatever
media) and other documents relating thereto (collectively, the "Tax Documents")
existing on the date hereof or created through or with respect to taxable
periods ending on or before the Distribution Date, until the later of (a) the
expiration of the statute of limitations (including extensions), of the taxable
years to which such Tax Returns and Tax documents relate, or (b) DECEMBER 31,
2005. No Tax Documents shall be destroyed or otherwise disposed of by either FAF
or LAC (or any member of their respective Groups) until the party intending to
make such disposition has given the other party at least thirty (30) days
advance
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notice thereof, whereupon the party receiving such notice shall have the right,
at its own expense, to take possession of such Tax Documents.
4.3 COOPERATION REGARDING RETURN FILINGS, EXAMINATIONS AND
CONTROVERSIES.
(a) LAC's Obligations. In addition to any obligations imposed pursuant
to the Distribution Agreement, LAC and each other member of the LAC Group shall
fully cooperate with FAF and its representatives, in a prompt and timely manner,
in connection with the preparation and filing of, and any inquiry, audit,
examination, investigation, dispute, or litigation involving, any Tax Return
filed or required to be filed by or for any member of the FAF Group for any
taxable period beginning before the Distribution Date and relating to Taxes.
Such cooperation shall include, but not be limited to, (i) making available to
FAF, during normal business hours, and within thirty (30) days of any request
therefor, all Tax Documents, books, records and information, and the assistance
of all officers and employees, necessary or useful in connection with any Tax
inquiry, audit, examination, investigation, dispute, litigation or any other
matter, and (ii) agreeing to make any election in connection with any such Tax
Return that will not adversely affect LAC or any member of the LAC Group.
LAC agrees on behalf of itself and each member of the LAC Group to
execute and deliver to FAF, when so requested by FAF, any power of attorney
required to allow FAF and its counsel to represent LAC or such other LAC Group
member in any controversy which FAF shall have the right to control pursuant to
the terms of Section 4.1 of this Agreement.
(b) FAF's Obligations. Except as otherwise provided in this Article IV,
FAF shall fully cooperate with LAC and its representatives, in a prompt and
timely manner, in connection with (i) the preparation and filing of and (ii) any
inquiry, audit, examination, investigation, dispute, or litigation involving,
any Tax Return filed or required to be filed pursuant to Section 2.2(c) by or
for any member of the LAC Group and relating to Taxes. Such cooperation shall
include, but not be limited to, (i) making available to LAC, during normal
business hours, and within thirty (30) days of any request therefor, all books,
records and information, and the assistance of all officers and employees,
necessary or useful in connection with any tax inquiry, audit, examination,
investigation, dispute, litigation or any other matter, and (ii) agreeing to
make any election in connection with any such Tax Return that will not adversely
affect FAF or any member of the FAF Group.
FAF agrees on behalf of itself and each member of the FAF Group to
execute and deliver to LAC, when so requested by LAC, any power of attorney
required to allow LAC and its counsel to represent FAF or such other FAF Group
member in any controversy which LAC shall have the right to control pursuant to
the terms of Section 4.1(b) of this Agreement.
LAC Group's items of income and expense for the period ending on or
before the Distribution Date will be allocated based on a closing of the books
as of the Distribution Date.
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(c) Remedy for Failure to Comply. If FAF reasonably determines that LAC
is not for any reason fulfilling its obligations under Section 4.3(a), or if LAC
reasonably determines that FAF is not for any reason fulfilling its obligations
under Section 4.3(b), then FAF or LAC, as the case may be, shall have the right
to appoint, at the expense of the other, an independent entity such as a
nationally recognized public accounting firm to assist the other in meeting its
obligations under this Section 4.3. Such entity shall have complete access to
all books, records and information, and the complete cooperation of all officers
and employees, of LAC or FAF, as the case may be.
4.4 CERTAIN POST-DISTRIBUTION TRANSACTIONS. Each of FAF and LAC hereby
acknowledges that each of the parties hereto intends that the Distribution
qualify as a reorganization pursuant to Code Section 368(a)(1)(D) (a "Tax-Free
Reorganization") and a tax-free distribution pursuant to Section 355 of the Code
(a "Tax-Free Distribution"), and that such qualification is subject to certain
terms and conditions of the Code. Accordingly, each of FAF and LAC hereby agrees
not to engage in any transaction or commit or fail to take any action that would
cause the Distribution to fail to qualify as a Tax-Free Reorganization or
Tax-Free Distribution.
4.5 SURVIVAL OF AGREEMENT. This Agreement and all covenants contained
herein shall survive for the applicable statute of limitations and any
extensions thereof and any Final Determination applicable to periods beginning
before the Distribution Date.
ARTICLE V
MISCELLANEOUS
5.1 SEVERABILITY. In case any one or more of the provisions contained
in this Agreement should be invalid, illegal or unenforceable, the
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.
5.2 MODIFICATION OF AGREEMENT. No modification, amendment or waiver of
any provision of this Agreement shall be effective unless the same shall be in
writing and signed by each of the parties hereto and then such modification,
amendment or waiver shall be effective only in the specific instance and for the
purpose for which given.
5.3 CONFLICT WITH THE DISTRIBUTION AGREEMENT. Anything in this
Agreement or the Distribution Agreement to the contrary notwithstanding, in the
event and to the extent that there shall be a conflict between the provisions of
this Agreement and the Distribution Agreement, the provisions of this Agreement
shall control.
5.4 NOTICES. All notices or other communications required or permitted
under this Agreement shall be delivered by hand, mailed by certified or
registered mail, postage prepaid and return receipt requested, or sent by cable,
telegram, telex or telecopy (confirmed by regular, first-class mail), to the
parties at the following addresses (or at such other addresses for a party as
shall be specified by like notice) and shall be deemed given on the date on
which such notice is received:
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In the case of FAF, to In the case of LAC, to
Forward Air Corporation Landair Corporation
000 Xxxxxxx Xxxx 000 Xxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000 Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: General Counsel Attention: General Counsel
5.5 APPLICATION TO PRESENT AND FUTURE SUBSIDIARIES. This Agreement is
being entered into by FAF and LAC on behalf of themselves and each member of the
FAF Group and the LAC Group, respectively. This Agreement shall constitute a
direct obligation of each such member and shall be deemed to have been readopted
and affirmed on behalf of any corporation which becomes a member of the FAF
Group or the LAC Group in the future. FAF and LAC hereby guarantee the
performance of all actions, agreements and obligations provided for under this
Agreement of each member of the FAF Group and the LAC Group, respectively. FAF
and LAC shall, upon the written request of the other, cause any of their
respective group members formally to execute this Agreement. This Agreement
shall be binding upon, and shall inure to the benefit of, the successors,
assigns and persons controlling any of the corporations bound hereby.
5.6 TERM. This Agreement shall commence on the date of execution
indicated above and shall continue in effect until otherwise agreed to in
writing by FAF and LAC, or their successors.
5.7 TITLES AND HEADINGS. Titles and headings to sections herein are
inserted for the convenience of reference only and are not intended to be a part
or to affect the meaning or interpretation of this Agreement.
5.8 SINGULAR AND PLURAL. As used herein, the singular shall include
the plural and vice versa.
5.9 GOVERNING LAW. This Agreement shall be governed by the laws of the
State of Tennessee without regard to the principles of conflicts of laws
thereof.
5.10 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become a binding agreement when one or more counterparts have been signed
by each party and delivered to the other parties.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized officers, all on the day and year first
above written.
FORWARD AIR CORPORATION f/k/a
Landair Services, Inc.
By: /s/ Xxxxx X. Xxxxxxxx
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Title: President
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LANDAIR CORPORATION
By: /s/ X. X. Xxxxx
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Title: President
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