Exhibit 10.1

 

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March 22, 2018

 

 

Mr. James A. Craig

2233 Dr. Sanders Road

Cross Roads, TX 76227

 

Dear Jim:

 

This letter agreement (“Agreement”) sets forth the agreements and understandings
among you (“you” or “Executive”) and USA Truck, Inc. (the “Company”) regarding
the conclusion of your employment relationship with the Company.

 

1.     Separation. Executive relinquishes his titles as Executive Vice President
– Chief Commercial Officer and President – USAT Logistics of the Company, and
all other titles with the Company or its subsidiary (if any), and will no longer
be required to report to work, effective May 1, 2018 (the "Resignation Date"),
provided that Executive and the Company hereby agree that Executive will remain
employed by the Company and his existing salary and insurance benefits will
continue without modification, except as set forth herein, through May 31, 2018
(the “Separation Date”). Executive's signature on this Agreement will function
as his irrevocable resignation from employment and all positions with the
Company and its subsidiary effective as of the Separation Date.

 

2.     Severance Benefits. Subject to Sections 5 and 6 of this Agreement:

 

(a)     Non-Compete Payments. The Company agrees to pay you Non-Compete
Payments, as defined in that certain Executive Severance and Change in Control
Agreement between Executive and the Company, dated February 2, 2016, as amended
January 31, 2017 (the "Severance Agreement"), equal to one-twelfth of your
current base salary ($350,000 per year) for a period of twelve months from the
Separation Date, on or as near as practicable to the same date in each month as
monthly installments of the annual base salary were made to Executive prior to
the Separation Date, in order to bind Executive to the provisions of Section
14(ii) of the Severance Agreement during such period. Executive waives any
requirement for the Company to provide notice to Executive of its intent to
elect to make such payments and the Company waives any right to elect to make
such payments for a period less than such twelve months.

 

(b)     2018 Cash Bonus Payment. The Company agrees to pay you the amount, in
cash, if and to the extent earned, under the short-term cash incentive
compensation plan adopted by the Committee for 2018, pro-rated for the number of
days you were employed by the Company in 2018 through the Separation Date,
payable at the same time and on the same basis as paid to recipients still
employed by the Company.

 

(c)     Accelerated Vesting of Certain Equity Awards. The following outstanding
equity awards held by Executive will vest as of the Separation Date: (i) the
5,488 shares of time-vested restricted stock of the Company scheduled to vest on
July 30, 2018, held pursuant to that certain USA Truck, Inc. 2014 Omnibus
Incentive Plan Award Notice date January 29, 2017, and (ii) the 5,488 shares of
performance-vested restricted stock of the Company scheduled to vest on July 30,
2018, subject to attainment of certain performance goals, held pursuant to that
certain USA Truck, Inc. 2014 Omnibus Incentive Plan Award Notice date January
29, 2017 ((i) and (ii) together, the “Accelerated Vesting”). You acknowledge and
agree that you would not be entitled to the Accelerated Vesting under the
Severance Agreement, the foregoing award notices, or otherwise, and that the
Company is agreeing to the Accelerated Vesting as an additional benefit.

 

 

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(d)     Accrued Vacation. The Company agrees to pay you for unused vacation
accrued but not used through the Resignation Date.

 

3.    Waiver of Other Severance Benefits. Other than as provided for in this
Agreement, Executive waives any right to severance or any other benefits in
connection with or as a result of the cessation of his employment with the
Company, for any reason, under the Severance Agreement or otherwise, and agrees
that he is only entitled to the payments and other separation benefits provided
in this Agreement. Executive acknowledges that he is not entitled to any future
continuing health or other benefits (except as may be required by applicable
law) and waives any rights other than those required under applicable law.

 

4.     Equity Awards. Except as provided in Section 2(c) of this Agreement, all
outstanding unvested equity awards held by Executive (including, without
limitation, any restricted stock and performance units) will terminate as of the
Separation Date, and all rights to any equity awards (including, without
limitation, any other awards of Company equity, whenever granted) will be
forfeited as of the Separation Date. Except for the accelerated vesting provided
in Section 2(c) of this Agreement, Executive acknowledges and agrees that any
equity awards that would have been granted to him in 2018 would have been
forfeited pursuant to the terms of the applicable award documents, and
accordingly, Executive waives his right to participate in the any equity awards
for 2018 and acknowledges and agrees that no equity awards will be made to him
with respect to 2018.

 

5.     Restrictive Covenants. Executive acknowledges and agrees that he is bound
by and will maintain continuous compliance with the restrictive covenants set
forth in the Severance Agreement, including, without limitation, the covenants
set forth in Sections 14, 15, and 16 of the Severance Agreement. Executive
acknowledges and agrees that he is bound by the remedies for breach of Sections
14, 15, and 16 of the Severance Agreement that are provided in Section 17 of the
Severance Agreement. Executive agrees that he will maintain continuous
compliance with the Company’s employee handbook, Code of Business Conduct and
Ethics Policy, and any other policies of the Company, to the extent applicable
to Executive following the Resignation Date. Executive acknowledges and agrees
that payment of his existing salary and insurance benefits between the
Resignation Date and the Separation Date as described in Section 1 of this
Agreement and the severance benefits in Section 2 of this Agreement is subject
to continuous compliance with such restrictive covenants, handbook, and
policies.

 

6.     Waiver and Release of Claims. In order to receive amounts payable under
Section 2 hereof, Executive must execute a timely and effective release of
claims in the form attached hereto and marked Exhibit A (the "Release of
Claims") on or after the Separation Date, and no amounts will be payable under
Section 2 hereof until the Release of Claims is effective. The payments in
Section 2(a) will commence following the Effective Date (as defined in the
Release of Claims) on or as near as practicable to the same date in each month
as monthly installments of the annual base salary were made to Executive prior
to the Separation Date and the payments in Section 2(d) will be paid to
Executive within five (5) business days after the Effective Date. The Release of
Claims creates legally binding obligations and the Company therefore advises
Executive to consult an attorney before signing it.

 

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7.     No Admission of Wrongdoing. The parties agree that nothing in this
Agreement is an admission by any party hereto of any wrongdoing, either in
violation of an applicable law or otherwise, and that nothing in this Agreement
is to be construed as such by any person.

 

8.     Voluntary Agreement; Tax Advice and Information. Executive further
acknowledges that he understands this Agreement, the claims he is releasing
under the Release of Claims, the promises and agreements he is making, and the
effect of his signing this Agreement. Executive understands the payments to him
under this Agreement are in excess of those to which he is legally entitled and
agrees that he voluntarily accepts the payments described above as additional
consideration for the restrictive covenants, handbook, and policies referenced
in Section 5 of this Agreement and other obligations referred to herein and for
the purpose of making a full and final compromise, adjustment and settlement of
all claims or potential claims against the Releasees (as defined in the Release
of Claims) from any action or inaction taking place on or before the Separation
Date. Executive acknowledges that neither the Company nor any of its
representatives have provided Executive with any tax advice or tax-related
representations concerning any payments or benefits (including, without
limitation, the Accelerated Vesting) provided for in this Agreement. Further,
Executive understands that he should consult Executive’s own independent tax
advisors for any such tax advice or information.

 

9.     Return of Company Property. Executive agrees that, not later than the
Resignation Date, he will return to the Company all of its property in
Executive’s possession, custody or control, including, without limitation, all
Confidential Information (as defined in the Severance Agreement), keys, access
cards, credit cards, computer hardware (including but not limited to any hard
drives, diskettes, laptop computers and personal data assistants and the
contents thereof, as well as any passwords or codes needed to operate any such
hardware), cellular telephones, computer software, data, materials, papers,
books, files, documents, records, policies, client and customer information and
lists, marketing information and lists, mailing lists, notes and any other
property or information that Executive has or had relating to the Company or its
Affiliates (whether those materials are in paper or electronic form), and
including, but not limited to, any documents containing, summarizing or
describing any Confidential Information. To the extent any personal data is
contained on any Company property, including, without limitation, any laptop
computers, the Company will return to Executive any personal data the Company is
able to retrieve.

 

10.     Indemnification. The Company hereby agrees that Executive will continue
to be entitled to all of his respective statutory rights to indemnification,
including, without limitation, indemnification pursuant to the Company's
organizational documents, insurance policies, or under applicable law to the
same extent Executive would have had the right to be indemnified absent this
Agreement and the Release of Claims.

 

11.     IRC Section 409A. Executive received this Agreement in the current
calendar year. If Section 409A of the Internal Revenue Code of 1986, as amended
(the “IRC”) requires, Executive will get no pay or benefits in this Agreement
until the next calendar year (even if you sign it sooner), if the maximum time
period to sign it (plus any revocation period) ends in the next calendar year.
The payments under this Agreement are intended, and must be interpreted, to
comply with Section 409A of the IRC, to the maximum extent possible. Any salary
continuation payment in this Agreement is a separate “payment” under Section
409A of the IRC. The Company makes no representation or warranty and shall have
no liability to Executive or any other person if the provisions of this
Agreement are determined to constitute deferred compensation subject to Section
409A of the IRC, but do not satisfy an exemption from, or the conditions of,
Section 409A of the IRC. If for any reason any provision of this Agreement does
not accurately reflect its intended establishment of an exemption from or
compliance with Section 409A of the IRC, as demonstrated by consistent
interpretations or other evidence of intent, such provision shall be considered
ambiguous as to its exemption from or compliance with Section 409A of the IRC
and shall be interpreted by the Company in a manner consistent with such intent,
as determined in the discretion of the Company. Executive is responsible for any
tax penalties imposed on Executive, not the Company.

 

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12.     Governing Law. The parties agree that the Agreement will be interpreted
and governed by the laws of the state of Arkansas without regard to principles
of comity or conflict of law provisions of any jurisdiction.

 

13.    Modification. The parties hereto agree that this Agreement may not be
modified, altered or changed except by a written agreement signed by the parties
hereto.

 

14.    Entire Agreement. The parties acknowledge that this Agreement and the
Severance Agreement (to the extent specifically incorporated herein), constitute
the entire agreement between them regarding Executive’s separation, superseding
all prior written and oral agreements regarding such topic, including, without
limitation, that certain letter agreement between you and the Company dated
February 2, 2016; provided, however, that this Agreement will not constitute a
waiver by the Company of any right they now have or may now have under any
agreement imposing obligations on you with respect to confidentiality,
non-competition, non-solicitation of employees, customers, vendors or
independent contractors or like obligations. Executive acknowledges and agrees
that the termination and notice provisions contained in Section 5 of the
Severance Agreement do not apply and are hereby waived.

 

15.    Invalidity of Provisions/Severability. If any portion or provision of
this Agreement shall to any extent be declared illegal or unenforceable by a
court of competent jurisdiction, then the remainder of this Agreement, or the
application of such portion or provision in circumstances other than those as to
which it is so declared illegal or unenforceable, will not be affected thereby,
and each portion and provision of this Agreement will be valid and enforceable
to the fullest extent permitted by law.

 

16.   No Reliance; Taxes. The parties have not relied on any representations,
promises, or agreements of any kind made to them in connection with this
Agreement, except for those set forth in this Agreement. Any payments made to
Executive under this Agreement will be reduced by the full amount legally
required to be withheld for federal, state, or local tax purposes by the
Company.

 

17.     Notices. Any notices to be given hereunder by either party hereto to the
other may be effected either by (a) personal delivery in writing, (b) facsimile,
or (c) mail, registered or certified, postage prepaid, with return receipt
requested.  Mailed or faxed notices will be addressed or faxed to Executive at
the address on file at the Company, and to the Company as follows:

 

USA Truck, Inc.

3200 Industrial Park Road

Van Buren, Arkansas 72956

Attn: Chief Executive Officer

Facsimile: (479) 471-2526

 

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18.     Execution; Binding Effect. This Agreement may be executed in any number
of counterparts, each of which will be deemed to be an original as against any
party whose signature appears thereon, and all of which will together constitute
one instrument. Delivery of an executed counterpart of a signature page to this
Agreement by facsimile or in electronic format (e.g., “pdf” or “tif”) will be
effective as delivery of a manually executed counterpart of this Agreement. This
Agreement will be binding upon and inure to the benefit of the Company, its
Affiliates, and their successors and assigns and will be binding upon Executive
and your heirs and personal representatives.

 

[Signature Page Follows]

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Sincerely,

 

 

 

James D. Reed

President and Chief Executive Officer

USA Truck, Inc.

 

 

 

AGREED AND ACCEPTED effective the 23rd day of March, 2018.

 

 

/s/ James A. Craig

James A. Craig

 

 

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Exhibit A

 

TO BE EXECUTED ON OR AFTER THE SEPARATION DATE

 

General Release

 

In exchange for the payments and benefits described in the agreement to which
this release is attached (the “Agreement”), Executive, on his own behalf and on
behalf of his heirs, executors, administrators, assigns and successors, does
hereby covenant not to sue and acknowledges full and complete satisfaction of
and hereby releases, absolves and discharges the Company and its Affiliates and
their successors and assigns, parents, subsidiaries and affiliates, past and
present, as well as their trustees, directors, officers, agents, attorneys,
insurers, stockholders and employees, past and present, and each of them
(hereinafter collectively referred to as “Releasees”), with respect to and from
any and all claims, demands, liens, agreements, contracts, covenants, actions,
suits, causes of action, obligations, debts, wages, vacation pay, expenses,
attorneys’ fees, damages, judgments, orders and liabilities of whatever kind or
nature in law, equity or otherwise, whether now known or unknown, suspected or
unsuspected, and whether or not concealed or hidden, which Executive now owns or
holds or has at any time heretofore owned or held as against said Releasees, or
any of them, arising out of or in any way connected with his employment or other
relationships with the Company or its Affiliates, or his separation from any
such employment or other relationships (collectively, “Released Claims”),
including specifically, but without limiting the generality of the foregoing,
any claim under Title VII of the Civil Rights Act of 1964, the Americans with
Disabilities Act, the Age Discrimination in Employment Act of 1967, as amended
by the Older Worker’s Benefit Protection Act (“ADEA”), the federal Family and
Medical Leave Act, the Fair Labor Standards Act, the Equal Pay Act, the Employee
Retirement Income Security Act of 1974, the Worker Adjustment and Retraining
Notification Act, or any other employment related federal, state or local law,
regulation or ordinance; provided, however, that the foregoing release will not
include or affect (and the following are expressly excluded from any Released
Claims): (i) Executive’s rights under the Agreement; (ii) Executive’s rights to
file claims for workers’ compensation or unemployment insurance benefits,
(iii) Executive’s regular and usual salary accrued prior to the Separation Date,
accrued but unused vacation through the Separation Date, COBRA continuation
coverage and life insurance conversion rights, if any, and (iv) Executive’s
rights to provide information, assist or participate in any investigation,
proceedings, or litigation concerning any administrative claim with any
government agency under any applicable law that protects such rights, or to file
such a claim. This General Release does not (i) limit Executive's ability to
file a charge or complaint with the Equal Employment Opportunity Commission, the
Occupational Safety and Health Administration, the Securities and Exchange
Commission or any other federal, state or local governmental agency or
commission (“Government Agencies”), (ii) limit Executive’s ability to
communicate with any Government Agencies or otherwise participate in any
investigation or proceeding that may be conducted by any Government Agency,
including providing documents or other information, without notice to the
Company, or (iii) limit Executive’s right to receive an award for information
provided to any Government Agencies.

 

Executive acknowledges that the non-disparagement and confidentiality provisions
contained in the Agreement infringe on Executive’s rights described in the
foregoing sentence, and Executive agrees that he is aware of and has consented
to such infringement. Furthermore, notwithstanding the foregoing release,
Executive will continue to be entitled to all of his respective statutory rights
to indemnification, including, without limitation, indemnification pursuant to
the Company’s organizational documents, insurance policies or under applicable
law to the same extent Executive would have had the right to be indemnified
absent this release.

 

 

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Executive acknowledges that he is waiving and releasing any rights he may have
under the ADEA and that this waiver and release is knowing and voluntary.
Executive and the Company agree that this waiver and release does not apply to
any rights or claims that may arise under the ADEA after the Effective Date (as
hereinafter defined) of the Agreement. Executive acknowledges that the
consideration given for the Agreement is in addition to anything of value to
which he was already entitled. Executive further acknowledges that he has been
advised by this writing that:

 

(a)     He should consult with an attorney prior to executing the Agreement;

 

(b)     He has at least twenty-one (21) days within which to consider the
Agreement, but if he wishes to sign the Agreement earlier, he may do so by
signing the Acknowledgment and Waiver of the 21-day consideration period in the
form attached as Exhibit B to the Agreement;

 

(c)     He has seven (7) days following his execution of the Agreement to revoke
the Agreement;

 

(d)     This Agreement will not be effective until the eighth day after
Executive executes and does not revoke the Agreement (the “Effective Date”); and

 

(e)     Nothing in the Agreement prevents or precludes Executive from
challenging or seeking a determination in good faith of the validity of this
waiver under the ADEA, nor does it impose any condition precedent, penalties or
costs from doing so, unless specifically authorized by federal law. Any
revocation must be in writing and hand delivered to the Company by close of
business on or before the seventh day from the date that Executive signs the
Agreement. In the event that Executive exercises his right of revocation,
neither Executive nor any member of the Company or its Affiliates will have any
further rights or obligations under the Agreement.

 

Executive represents and warrants that he has no present knowledge of any
injury, illness or disease to him that is or might be compensable as a workers’
compensation claim or similar claim for workplace injuries, illnesses or
diseases.

 

Terms used herein and not otherwise defined will have the meanings set forth in
the Agreement to which this Release was attached.

 

[Signature page follows]

 

 

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Intending to be legally bound, I have signed this General Release as of the date
written below.

 

 

Signature: _____________________________________________

James A. Craig 

 

Date Signed: ___________________________________________

 

 

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Exhibit B

 

Acknowledgment and Waiver

 

I, James A. Craig, hereby acknowledge that I was given 21 days to consider the
foregoing Agreement and voluntarily chose to sign the Agreement prior to the
expiration of the 21-day period.

 

I declare under penalty of perjury under the laws of the United States of
America, that the foregoing is true and correct.

 

EXECUTED this ___ day of ________________, ________, at _________________
County, __________.

 

 

 

 

 

 

 

 

 

 

James A. Craig