EXHIBIT K TO
STOCK AGREEMENT PURCHASE
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of
April 19, 2000, by and between Xxxx Xxxxxx Fast Freight, Inc., a Mississippi
corporation (the "Company"), and Xxxx X. Xxxxxx, Xx. (the "Executive").
WHEREAS, the Company desires to employ the Executive as President and the
Executive is willing to render his services to the Company on the terms,
covenants, and conditions with respect to such employment as hereinafter set
forth;
NOW, THEREFORE, in consideration of the promises, terms, and conditions
hereof, the Company and the Executive agree as follows. Unless otherwise defined
herein, all capitalized terms shall have the meanings set forth in the Stock
Purchase Agreement dated April 19, 2000, among the Company, the Executive, and
Knight Transportation, Inc. (the "Stock Purchase Agreement")..
1. Employment. The Company employs the Executive and the Executive accepts
such employment with the Company upon the terms and conditions hereinafter set
forth. The Executive represents and warrants that neither the execution by him
of this Agreement nor the performance by him of his duties and obligations
hereunder will violate any agreement to which he is a party or by which he is
bound.
2. Term. The term of this Agreement shall be three (3) years and shall
commence on the date and year first above written and end on the third
anniversary of such date unless sooner terminated pursuant to Section 6 of this
Agreement.
3. Duties. The Executive is employed as President and shall render his
services at the principal business offices of the Company. As President of the
Company, the Executive has responsibility and authority for the day-to-day
operation of the business of the Company. The Executive shall report directly to
the Chief Executive Officer of the Company (the "CEO") and shall have such
authority and shall perform such duties as are customarily performed by one
holding the position of President, subject, however, to such limitations,
instructions, directions, and control as the CEO and Board of Directors may
specify from time to time in their sole discretion.
4. Exclusive Services. The Executive shall devote all necessary working
time, ability, and attention to the business of the Company during the term of
this Agreement in a manner consistent with the time, ability, and attention the
Executive devoted to the business of the Company in the year preceding the date
hereof. The Executive shall be bound by the noncompetition provisions of Section
5.9 (the "Noncompetition Obligations") of the Stock Purchase Agreement. Anything
to the contrary notwithstanding, the Executive may devote not more than five (5)
hours per week during business hours, meaning between 8:00 a.m. and 5:30 p.m.
Central Time, to the Redeemed Business, so long as such activity does not
interfere with the performance of his duties hereunder.
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5. Compensation. As compensation for his services in any capacity rendered
under this Agreement, the Executive shall be entitled to receive the following,
subject to Section 6 hereof:
a. Salary. During the term of this Agreement the Company shall pay the
Executive a salary at the rate of $16,667 per month (the "Salary"). The
Salary shall be payable in accordance with the ordinary payroll practices
of the Company.
b. Benefits. For so long as the Executive continues to perform his
duties on a full-time basis during the term of this Agreement, the
Executive shall be able to participate in any and all employee benefit
plans, including but not limited to health and medical insurance, bonus
plans, and retirement plan contributions, as may be in effect for other
employees of the Company that are deemed comparable employees by the CEO.
6. Termination. The Executive's employment hereunder may be terminated as
follows:
a. By the Executive or by the Company without Cause. The Executive may
terminate his employment at any time by giving thirty (30) days' prior
written notice of termination to the CEO, in which case all payments of
Salary, benefits, and any other amounts due hereunder shall cease as of the
Executive's final day of employment (except in the event of "Forced
Resignation," which is addressed below). If the Executive is terminated by
the Company without "Cause," as defined below, or resigns due to a "Forced
Resignation," the Executive shall receive for the remaining original term
of this Agreement payments equal to and at the same times as the Salary
described in Section 5.a but no other amount or benefit hereunder, and such
payments shall be made so long as he remains available to the Company to
provide consulting services as requested and does not violate the
Noncompetition Obligations. For purposes of this Agreement, "Forced
Resignation" shall mean (x) resignation following a material reduction in
the Executive's responsibilities from that stated herein (without the
Executive's consent) such that no reasonable person could be expected to
continue his employment, or (y) relocation of the Executive (without his
consent) to a place of business more than fifty (50) miles from the
Company's current headquarters; provided, that any resignation during the
first eighteen (18) months of this Agreement shall not be a Forced
Resignation.
b. By the Company with Cause. The CEO may, in his reasonable
discretion and judgment and upon written notice effective immediately,
terminate Executive's employment under this Agreement at any time for
"Cause." Cause shall mean:
i. If the Executive is convicted or pleads guilty or no contest
under any applicable criminal code or statute of (A) any felony or (B)
any misdemeanor which involves fraud or dishonesty against the Company
or any affiliated or successor entity or a sentence of confinement or
incarceration for longer than thirty (30) days;
ii. If the Executive breaches the Noncompetition Obligations;
iii. If the Executive breaches any fiduciary duty to the Company;
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iv. If the Executive materially and willfully fails or refuses to
carry out the lawful and reasonable directions of the CEO or Board of
Directors of the Company, following written warning; provided that
such directions must not support a Forced Resignation;
v. If the Executive engages in conduct so outrageous and
detrimental that the Company cannot reasonably continue to employ him;
or
vi. If the Executive himself violates or knowingly permits
employees or independent contractors of the Company to violate
applicable Laws regarding the business of the Company.
If the Executive's employment is terminated for Cause, the Executive shall
receive any Salary accrued to the date of such termination and shall not be
entitled to any compensation or other payment or benefit thereafter.
c. Physical or Mental Illness Incapacity. Executive's employment under
this Agreement shall be terminable by the Company as a result of the
Executive's incapacity due to physical or mental illness, on the earlier of
either: (i) the date when the Executive is eligible for coverage under any
long-term disability insurance plan then carried by the Company; or (ii)
the date when the Executive shall have been materially unable to perform
his duties hereunder for a period of three (3) consecutive months (unless
within ten (10) days after written notice to return is given, which may
occur at or after the end of such three (3) month period, Executive shall
have returned to the performance of his duties hereunder on a full-time
basis). In the event of termination under this Section, (i) the Executive's
Salary shall be paid through the date of termination of this Agreement; and
(ii) the rights and benefits of the Executive under employee benefit and
fringe benefit plans, and other programs of the Company shall be determined
in accordance with the terms and provisions of such plans and programs.
d. Death. Executive's employment under this Agreement shall terminate
as a result of the death of the Executive. In the event of termination
under this Section, the Executive's estate or his designated beneficiary or
beneficiaries shall be entitled to receive (i) the Executive's Salary paid
through the date of termination of this Agreement; and (ii) rights under
the benefit plans and programs of the Company determined in accordance with
the terms and provisions of such plans and programs.
7. Notices. Any notice, request, demand, waiver, consent, approval, or
other communication which is required or permitted hereunder shall be in writing
and shall be deemed given only if delivered personally (including by nationally
recognized overnight courier service) or sent by telegram or by certified mail,
postage prepaid, and sent by telecopier as follows:
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If to the Company: Xxxxx X. Xxxxxx
Knight Transportation, Inc.
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxx, XX 00000
(000) 000-0000 Telephone
(000) 000-0000 Fax
With required copy to: Xxxx X. Xxxxxxx
Xxxxxxx Law Firm, P.C.
000 Xxxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
(000) 000-0000 Telephone
(000) 000-0000 Fax
If to the Executive: Xxxx X. Xxxxxx, Xx.
P. O. Xxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000
__________________ Telephone
__________________ Fax
With required copy to: Xxxxxxxxx X. Xxxx
Xxxxxx and Xxxx, L.L.P.
0000 00xx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
(000) 000-0000 Telephone
(000) 000-0000 Fax
or to such other address as the addressee shall have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver,
consent, approval, or other communication shall be deemed to have been given as
of the date so personally delivered, telegraphed, or deposited in the mail and
telecopied.
8. Set-off. All payments due the Executive for Salary hereunder shall be
subject to the right of the Company to withhold such payments and offset them
against any amounts owed by the Executive to Knight Transportation, Inc., an
Arizona corporation, or any of its Affiliates under the Stock Purchase
Agreement. The Company shall give the Executive five (5) days' written notice of
any set-off.
9. General Provisions.
a. Law Governing. This Agreement shall be governed by and construed in
accordance with the laws of the State of Mississippi.
b. Invalid Provisions. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable, such provision shall be fully
severable and this Agreement shall be construed and enforced as if such
illegal, invalid, or unenforceable provision had never comprised a part
hereof; and the remaining provisions hereof shall remain in full force and
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effect and shall not be affected by the illegal, invalid, or unenforceable
provision or by its severance therefrom. Furthermore, in lieu of such
illegal, invalid, or unenforceable provision there shall be added
automatically as a part of this Agreement a provision as similar in terms
to such illegal, invalid, or unenforceable provision as may be possible and
still be legal, valid, or enforceable.
c. Attorneys' Fees. If any action at law or in equity is brought to
enforce or interpret the provisions of this Agreement, the prevailing party
shall be entitled to recover reasonable attorneys' fees from the other
party. These fees shall be in addition to any other relief that may be
awarded.
d. Entire Agreement. This Agreement sets forth the entire
understanding of the parties and supersedes all prior agreements or
understandings, whether written or oral, with respect to the subject matter
hereof. No terms, conditions, or warranties, other than those contained
herein, and no amendments or modifications hereto shall be binding unless
made in writing and signed by the parties hereto.
e. Binding Effect. This Agreement shall extend to and be binding upon
and inure to the benefit of the parties hereto, their respective heirs,
representatives, successors, and assigns. This Agreement may not be
assigned by the Executive.
f. Waiver. The waiver by either party hereto of a breach of any term
or provision of this Agreement shall not operate or be construed as a
waiver of a subsequent breach of the same provision by any party or of the
breach of any other term or provision of this Agreement.
g. Titles. Titles of the sections herein are used solely for
convenience and shall not be used for interpretation or construing any
word, clause, paragraph, or provision of this Agreement.
h. Counterparts. This Agreement may be executed in two counterparts,
each of which shall be deemed an original, but which together shall
constitute one and the same instrument.
i. Contingency.. The terms and conditions of this Agreement are
expressly contingent upon the closing of the Stock Purchase Agreement.
IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the date and year first above written.
EXECUTIVE XXXX XXXXXX FAST FREIGHT, INC.,
a Mississippi corporation
/s/ Xxxx X. Xxxxxx, Xx. By: /s/ Xxxx X. Xxxxxx, Xx.
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Xxxx X. Xxxxxx, Xx., individually Xxxx X. Xxxxxx, Xx., President
