Document:

Exhibit 10.6

 

U.S. XPRESS ENTERPRISES, INC.

EMPLOYEE STOCK PURCHASE PLAN

 

1.    Purpose. The purpose of the Plan is to provide employees of the Company and its Designated Companies with an opportunity to purchase Common Stock through accumulated Contributions. The Company intends for the Plan to qualify as an “employee stock purchase plan” under Section 423 of the Code. Accordingly, the Plan will be construed so as to extend and limit Plan participation in a uniform and nondiscriminatory basis consistent with the requirements of Section 423 of the Code. This Plan has been approved by the Company’s stockholders and Board prior to the Registration Date (as hereinafter defined).

 

2.    Definitions.

 

(a)    “Administrator” means the Board or any Committee designated by the Board to administer the Plan pursuant to Section 14.

 

(b)    “Applicable Laws” means the requirements relating to the administration of equity-based awards and the related issuance of shares of Common Stock under U.S. state corporate laws, U.S. federal and state securities laws, the Code, and any stock exchange or quotation system on which the Common Stock is listed or quoted.

 

(c)    “Board” means the Board of Directors of the Company.

 

(d)    “Code” means the U.S. Internal Revenue Code of 1986, as amended. Reference to a specific section of the Code or U.S. Treasury Regulation thereunder will include such section or regulation, any valid regulation or other official applicable guidance promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.

 

(e)    “Committee” means the Compensation Committee of the Board.

 

(f)    “Common Stock” means the Class A common stock of the Company.

 

(g)    “Company” means U.S. Xpress Enterprises, Inc., a Delaware corporation, or any successor thereto.

 

(h)    “Compensation” shall be defined from time to time by the Committee in its sole discretion with respect to any Offering Period. Except as otherwise defined by the Committee from time to time in its sole discretion, “Compensation” means the pre-tax regular base wages paid to such Eligible Employee by the Company or a Designated Company prior to giving effect to any compensation reductions made in connection with plans described under Sections 125, 402(g), or 401(k) of the Code. Except as otherwise determined by the Committee, “Compensation” does not include: (1) any bonuses or commissions, (2) overtime pay, (3) any amounts contributed by the Company or a Designated Company to any pension plan, (4) any automobile or relocation allowances (or reimbursement for any such expenses), (5) any amounts realized from the exercise of any stock options or other equity incentive awards, (6) any amounts paid by the Company or a Designated Company for other fringe benefits, such as health and welfare, hospitalization and group life insurance benefits, or perquisites, or paid in lieu of such benefits, or (7) other forms of compensation.

 

(i)    “Contributions” means the payroll deductions used to fund the exercise of options granted pursuant to the Plan.

 

 

(j)    “Designated Company” means any Subsidiary that has been designated by the Administrator from time to time in its sole discretion as eligible to participate in the Plan. As of the Effective Date, the Company and the Subsidiaries listed on Exhibit A hereto are Designated Companies.

 

(k)    “Designated Percent” means the percentage of Fair Market Value determined by the Administrator for purposes of determining the Purchase Price.

 

(l)    “Effective Date” means the business day immediately prior to the Registration Date.

 

(m)  “Eligible Employee” means any individual who is an employee providing services to the Company or a Designated Company, unless any such employee is specifically excluded by the Administrator from participation. The Administrator, in its discretion, from time to time may, prior to an Offering Date for all options to be granted on such Offering Date in an Offering, determine (on a uniform and nondiscriminatory basis or as otherwise permitted by Treasury Regulation Section 1.423-2) that the definition of Eligible Employee will or will not include an individual if he or she: (i) has not completed at least one (1) year of service since his or her last hire date (or such lesser period of time as may be determined by the Administrator in its discretion), (ii) customarily works not more than twenty (20) hours per week (or such lesser period of time as may be determined by the Administrator in its discretion), (iii) customarily works not more than five (5) months per calendar year (or such lesser period of time as may be determined by the Administrator in its discretion), or (iv) is a highly compensated employee within the meaning of Section 414(q) of the Code, provided the exclusion is applied with respect to each Offering in an identical manner to all highly compensated individuals of the Employer whose employees are participating in that Offering. Each exclusion shall be applied with respect to an Offering in a manner complying with U.S. Treasury Regulation Section 1.423-2(e)(2)(ii).

 

(n)    “Employer” means the employer of the applicable Eligible Employee(s).

 

(o)    “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, including the rules and regulations promulgated thereunder.

 

(p)    “Fair Market Value” means, as of any date, the value of a share of Common Stock determined as follows:

 

(i)       For purposes of the Offering Date of the first Offering Period under the Plan, the Fair Market Value will be the initial price to the public as set forth in the final prospectus related to the Registration Statement.

 

(ii)      For all other purposes, the Fair Market Value will be the closing price of the Common Stock on the principal national securities exchange on which the Common Stock is then listed or admitted to trading, and the closing price shall be the last reported sale price regular way on such date (or, if no sale takes place on such date, the last reported sale price regular way on the next preceding date on which such sale took place), as reported by such exchange. If the Common Stock is not then so listed or admitted to trading on a national securities exchange, then Fair Market Value shall be the closing price (the last reported sale price regular way) of the Common Stock in the over-the-counter market as reported by the National Association of Securities Dealers Automated Quotation System (“NASDAQ”), if the closing price of the Common Stock is then reported by NASDAQ. If the Common Stock closing price is not then reported by NASDAQ, then Fair Market Value shall be the mean between the representative closing bid and closing asked prices of the Common Stock in the over-the-counter market as reported by NASDAQ. If the Common Stock bid and asked prices are not then reported by NASDAQ, then Fair Market Value shall be the quote furnished by any member of the Financial Industry Regulatory Authority selected from time to time by the Company for that purpose. If no member of the Financial Industry Regulatory Authority then furnishes quotes with respect to the Common Stock, then Fair Market Value shall be the value determined by the Committee in good faith.

 

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(q)    “Holding Period” has the meaning set forth in Section 9(b) hereof.

 

(r)    “Maximum Share Amount” means the maximum number of Shares that a Participant may purchase on any given Purchase Date, as determined by the Committee in its sole discretion and subject to the limitations set forth in Section 3(b). Until specified otherwise by the Committee, the Maximum Share Amount for any Offering Period shall be determined by dividing (i) $5,000 by (ii) the Fair Market Value of one share of Common Stock on the Offering Date for such Offering Period.

 

(s)    “New Purchase Date” means a new Purchase Date if the Administrator shortens any Offering Period then in progress.

 

(t)    “Offering” means an offer under the Plan of an option that may be exercised during an Offering Period.

 

(u)    “Offering Date” means the first Trading Day of each Offering Period.

 

(v)    “Offering Periods” means the period of time during which offers to purchase Common Stock are outstanding under the Plan as further described in Section 4. The Committee shall determine the length of each Offering Period, which need not be uniform; provided that no Offering Period shall exceed twenty-seven (27) months in length, and provided, further, that the first Offering Period under the Plan will commence with the first Trading Day on or after the Registration Date and will end on the last Trading Day before January 1, 2019, and provided, further, that the second Offering Period under the Plan will commence on the first Trading Day on or after January 1, 2019. No voluntary payroll deductions shall be solicited until after the effective date of a registration statement on Form S-8 filed under the Securities Act of 1933, as amended, covering the shares to be issued under the Plan.

 

(w)    “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code.

 

(x)    “Participant” means an Eligible Employee that participates in the Plan.

 

(y)    “Plan” means this U.S. Xpress Enterprises Inc. Employee Stock Purchase Plan.

 

(z)    “Purchase Date” means the last Trading Day of the Offering Period.

 

(aa)    “Purchase Price” means the Designated Percent of the Fair Market Value of a share of Common Stock on the Offering Date or on the Purchase Date, whichever is lower. Unless otherwise determined by the Administrator, the Designated Percent for purposes of the foregoing sentence is eighty-five percent (85%). The Administrator may change the Designated Percent for any Offering Period but in no event shall the Designated Percent be less than eighty-five percent (85%).

 

(bb)     “Registration Date” means the effective date of the Registration Statement.

 

(cc)      “Registration Statement” means the registration statement on Form S-1 filed with the Securities and Exchange Commission for the initial public offering of Common Stock.

 

(dd)    “Securities Act” means the Securities Act of 1933, as amended from time to time.

 

(ee)    “Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Code.

 

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(ff)    “Trading Day” means a day on which the New York Stock Exchange is open for trading.

 

(gg)    “U.S. Treasury Regulations” means the Treasury regulations of the Code. Reference to a specific Treasury Regulation or Section of the Code shall include such Treasury Regulation or Section, any valid regulation promulgated under such Section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such Section or regulation.

 

3.    Eligibility; Offering Periods.

 

(a)    Eligibility. Any Eligible Employee on a given Offering Date will be eligible to participate in the Plan, subject to the requirements of Section 5.

 

(b)    Limitations. Any provisions of the Plan to the contrary notwithstanding, no Eligible Employee will be granted an option under the Plan (i) to the extent that, immediately after the grant, such Eligible Employee (or any other person whose stock would be attributed to such Eligible Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company or any Parent or Subsidiary of the Company and/or hold outstanding options to purchase such stock possessing five percent (5%) or more of the total combined voting power or value of all classes of the capital stock of the Company or of any Parent or Subsidiary of the Company, or (ii) to the extent that his or her rights to purchase stock under all employee stock purchase plans (as defined in Section 423 of the Code) of the Company or any Parent or Subsidiary of the Company accrues at a rate which exceeds twenty-five thousand dollars ($25,000) worth of stock (determined at the Fair Market Value of the stock at the time such option is granted) for each calendar year in which such option is outstanding at any time, as determined in accordance with Section 423 of the Code and the regulations thereunder.

 

4.    Offering Periods. The Plan shall be implemented by consecutive Offering Periods with a new Offering Period commencing on the first Trading Day on or after January 1 and July 1 of each year, or on such other date as the Administrator shall determine, and continuing thereafter until terminated in accordance with the Plan; provided, however, that the first Offering Period under the Plan will commence with the first Trading Day on or after the Registration Date, and provided, further, that the second Offering Period under the Plan will commence on the first Trading Day on or after January 1, 2019. Unless otherwise determined by the Administrator, each Offering Period shall be for a period of six (6) months during which an option granted pursuant to the Plan may be exercised.  The Administrator will have the power to change the duration of Offering Periods (including the commencement dates thereof) without stockholder approval. Any such change shall be announced prior to the scheduled beginning of the first Offering Period to be affected thereafter.

 

5.    Participation. An Eligible Employee may participate in the Plan by (i) submitting to the Company’s stock administration office (or its designee), on or before a date determined by the Administrator prior to an applicable Offering Date, a properly completed subscription agreement authorizing Contributions in the form provided by the Administrator for such purpose, or (ii) following an electronic or other enrollment procedure determined by the Administrator.

 

6.    Contributions.

 

(a)    At the time a Participant enrolls in the Plan pursuant to Section 5, he or she will elect to have Contributions made on each pay day during the Offering Period in an amount not exceeding fifteen percent (15%) of the Compensation which he or she receives on each pay day during the Offering Period. A Participant’s subscription agreement will remain in effect for successive Offering Periods unless terminated as provided in Section 10 hereof.

 

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(b)    Payroll deductions for a Participant will commence on the first pay day following the Offering Date and will end on the last pay day prior to the Purchase Date of such Offering Period to which such authorization is applicable, unless sooner terminated by the Participant as provided in Section 10 hereof.

 

(c)    All Contributions made for a Participant will be credited to his or her account under the Plan and Contributions will be made in whole percentages only.

 

(d)    A Participant may discontinue his or her participation in the Plan as provided in Section 10. A Participant may decrease the rate of his or her Contributions during an Offering Period by delivery of a subscription agreement to the Administrator or its designee; provided, however, that a Participant may make such a change only once per Offering Period. The change will become effective as soon as administratively practicable after receipt; provided, however, that any such change shall be effective no earlier than the first Offering Period that begins at least five (5) business days after the Administrator’s receipt of a new subscription agreement from the Participant, unless a later date for implementation is requested by the Participant.

 

(e)    Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the Code and Section 3(b), a Participant’s Contributions may be decreased to zero percent (0%) at any time during an Offering Period. Subject to Section 423(b)(8) of the Code, Contributions will recommence at the rate originally elected by the Participant effective as of the beginning of the first Offering Period scheduled to end in the following calendar year, unless terminated by the Participant as provided in Section 10.

 

(f)    At the time the option is exercised, in whole or in part, or at the time some or all of the Common Stock issued under the Plan is disposed of (or any other time that a taxable event related to the Plan occurs), in each case, as related to a Participant’s option under the Plan, the Participant must make adequate provision for the Company’s or Employer’s federal, state, local or any other tax liability, if any, which arise upon the exercise of the option or the disposition of the Common Stock (or any other time that a taxable event related to the Participant under the Plan occurs). At any time, the Company or the Employer may, but will not be obligated to, withhold from the Participant’s compensation the amount necessary for the Company or the Employer to meet applicable withholding obligations, including any withholding required to make available to the Company or the Employer any tax deductions or benefits attributable to sale or early disposition of Common Stock by the Eligible Employee. In addition, the Company or the Employer may, but will not be obligated to, withhold from the proceeds of the sale of Common Stock or any other method of withholding the Company or the Employer deems appropriate to the extent permitted by U.S. Treasury Regulation Section 1.423-2(f).

 

7.    Grant of Option. On the Offering Date of each Offering Period, each Eligible Employee participating in such Offering Period will be granted an option to purchase on each Purchase Date during such Offering Period (at the applicable Purchase Price) up to a number of shares of Common Stock determined by dividing such Eligible Employee’s Contributions accumulated during such Offering Period prior to such Purchase Date and retained in the Eligible Employee’s account as of the Purchase Date by the applicable Purchase Price; provided that in no event will an Eligible Employee be permitted to purchase during each Offering Period more than the Maximum Share Amount and provided further that such purchase will be subject to the limitations set forth in Sections 3(b) and 13. The Eligible Employee may accept the grant of such option by electing to participate in the Plan in accordance with the requirements of Section 5. The Administrator may, for future Offering Periods, increase or decrease, in its absolute discretion, the maximum number of shares of Common Stock that an Eligible Employee may purchase during each Offering Period. Exercise of the option will occur as provided in Section 8, unless the Participant has withdrawn pursuant to Section 10. The option will expire on the last day of the Offering Period.

 

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8.    Exercise of Option.

 

(a)    Unless a Participant withdraws from the Plan as provided in Section 10, his or her option for the purchase of shares of Common Stock will be exercised automatically on the Purchase Date, and the maximum number of full shares subject to the option will be purchased for such Participant at the applicable Purchase Price with the accumulated Contributions from his or her account; provided that in no event will an Eligible Employee be permitted to purchase during each Offering Period more than the Maximum Share Amount and provided further that such purchase will be subject to the limitations set forth in Sections 3(b) and 13. No fractional shares of Common Stock will be purchased. Any Contributions accumulated in a Participant’s account which are not sufficient to purchase a full share will be refunded to the Participant, without interest. During a Participant’s lifetime, a Participant’s option to purchase shares hereunder is exercisable only by him or her.

 

(b)    In the event that the number of shares of Common Stock to be purchased by all Participants in any Offering Period exceeds the number of shares of Common Stock then available for issuance under the Plan, (i) the Company shall make a pro rata allocation of the remaining shares of Common Stock in as uniform a manner as shall be practicable and as the Committee shall, in its sole discretion, determine to be equitable and (ii) all funds not used to purchase shares of Common Stock on the Purchase Date shall be returned, without interest to the Participants.

 

9.    Delivery; Holding Period.

 

(a)    As soon as reasonably practicable after each Purchase Date on which a purchase of shares of Common Stock occurs, the Company will arrange the delivery to each Participant of the shares purchased upon exercise of his or her option in a form determined by the Administrator (in its sole discretion) and pursuant to rules established by the Administrator. The Company may permit or require that shares be deposited directly with a broker designated by the Company or to a designated agent of the Company, and the Company may utilize electronic or automated methods of share transfer. The Company may require that shares be retained with such broker or agent for a designated period of time and/or may establish other procedures to permit tracking of disqualifying dispositions of such shares. No Participant will have any voting, dividend, or other stockholder rights with respect to shares of Common Stock subject to any option granted under the Plan until such shares have been purchased and delivered to the Participant as provided in this Section 9.  If the Participant makes a disposition, within the meaning of Section 424(c) of the Code and regulations promulgated thereunder, of any shares issued to such Participant pursuant to the exercise of an option, and such disposition occurs within the two-year period commencing on the day after the Purchase Date or within the one-year period commencing on the day after the exercise date, such Participant shall, within five (5) days of such disposition, notify the Company thereof.

 

(b)    Unless otherwise determined by the Administrator, Participants are required to hold shares of Common Stock acquired under the Plan for the one-year period after the Purchase Date (the “Holding Period”). During the Holding Period, a Participant may not sell or transfer shares of Common Stock acquired under the Plan.

 

10.    Withdrawal.

 

(a)    A Participant may withdraw all but not less than all the Contributions credited to his or her account and not yet used to exercise his or her option under the Plan at any time by (i) submitting to the Company’s stock administration office (or its designee) a written notice of withdrawal in the form determined by the Administrator for such purpose (which may be similar to the form attached hereto as Exhibit B), or (ii) following an electronic or other withdrawal procedure determined by the Administrator; provided, however, that any notice to withdraw must be received by the Administrator at least ten (10) days prior to the next occurring Purchase Date (or such other notice period as may be established by the Administrator from time to time in its sole discretion). All of the Participant’s Contributions credited to his or her account will be paid to such Participant promptly after receipt of notice of withdrawal and such Participant’s option for the Offering Period will be automatically terminated, and no further Contributions for the purchase of shares will be made for such Offering Period. If a Participant withdraws from an Offering Period, Contributions will not resume at the beginning of the succeeding Offering Period, unless the Participant re-enrolls in the Plan in accordance with the provisions of Section 5.

 

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(b)    A Participant’s withdrawal from an Offering Period will not have any effect upon his or her eligibility to participate in any similar plan that may hereafter be adopted by the Company or in succeeding Offering Periods that commence after the termination of the Offering Period from which the Participant withdraws.

 

11.    Termination of Employment. Upon a Participant’s ceasing to be an Eligible Employee, for any reason, he or she will be deemed to have elected to withdraw from the Plan and the Contributions credited to such Participant’s account during the Offering Period but not yet used to purchase shares of Common Stock under the Plan will be returned to such Participant or, in the case of his or her death, to the person or persons entitled thereto under Section 15, and such Participant’s option will be automatically terminated. Unless determined otherwise by the Administrator in a manner that is permitted by, and compliant with, Section 423 of the Code, a Participant whose employment transfers between entities through a termination with an immediate rehire (with no break in service) by the Company or a Designated Company shall not be treated as terminated under the Plan.

 

12.    Interest. No interest will accrue on the Contributions of a Participant in the Plan.

 

13.    Stock. Subject to adjustment as provided in Section 19 hereof, the maximum number of shares of Common Stock that will be made available for sale under the Plan will be                          shares of Common Stock.

 

14.    Administration. Unless otherwise designated by the Board, the Committee shall serve as the Administrator. The Administrator will have full and exclusive discretionary authority to construe, interpret and apply the terms of the Plan, to designate separate Offerings under the Plan, to designate Subsidiaries as participating in the Plan, to determine eligibility, to adjudicate all disputed claims filed under the Plan and to establish such procedures that it deems necessary for the administration of the Plan. Without limiting the generality of the foregoing, the Administrator is specifically authorized to adopt rules and procedures regarding eligibility to participate, the definition of Compensation, handling of Contributions, making of Contributions to the Plan, establishment of bank or trust accounts to hold Contributions, obligations to pay payroll tax, determination of beneficiary designation requirements, withholding procedures and handling of stock certificates that vary with applicable local requirements. Every finding, decision and determination made by the Administrator will, to the full extent permitted by law, be final and binding upon all parties. With respect to employees of the Company or any entity that, directly or indirectly, is controlled by the Company, and any entity in which the Company has a significant equity interest, in either case as determined by the Committee, who reside or work outside the United States of America, the Committee may, in its sole discretion, amend the terms of the Plan with respect to such employees in order to conform such terms with the provisions of local law, and the Committee may, where appropriate, establish one or more plans or sub-plans to reflect such amended or varied provisions.

 

15.    Designation of Beneficiary.

 

(a)    If permitted by the Administrator, a Participant may file a designation of a beneficiary who is to receive any shares of Common Stock and cash, if any, from the Participant’s account under the Plan in the event of such Participant’s death subsequent to a Purchase Date on which the option is exercised but prior to delivery to such Participant of such shares and cash. In addition, if permitted by the Administrator, a Participant may file a designation of a beneficiary who is to receive any cash from the Participant’s account under the Plan in the event of such Participant’s death prior to exercise of the option. If a Participant is married and the designated beneficiary is not the spouse, spousal consent will be required for such designation to be effective.

 

(b)    Such designation of beneficiary may be changed by the Participant at any time by notice in a form determined by the Administrator. In the event of the death of a Participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such Participant’s death, the Company will deliver such shares and/or cash to the executor or administrator of the estate of the Participant, or if no such executor or administrator has

 

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been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such shares and/or cash to the spouse or to any one or more dependents or relatives of the Participant, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate.

 

(c)    All beneficiary designations will be in such form and manner as the Administrator may designate from time to time.

 

16.    Transferability. Neither Contributions credited to a Participant’s account nor any rights with regard to the exercise of an option or to receive shares of Common Stock under the Plan may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Section 15 hereof) by the Participant. Any such attempt at assignment, transfer, pledge or other disposition will be without effect, except that the Company may treat such act as an election to withdraw funds from an Offering Period in accordance with Section 10 hereof.

 

17.    Use of Funds. The Company may use all Contributions received or held by it under the Plan for any corporate purpose, and the Company will not be obligated to segregate such Contributions. Until shares of Common Stock are issued, Participants will only have the rights of an unsecured creditor with respect to the Plan.

 

18.    Reports. Individual accounts will be maintained for each Participant in the Plan. Statements of account will be given to participating Eligible Employees at least annually, which statements will set forth the amounts of Contributions, the Purchase Price, the number of shares of Common Stock purchased and the remaining cash balance, if any.

 

19.    Adjustments; Dissolution or Liquidation; Corporate Transactions.

 

(a)    Adjustments. In the event that there is, with respect to the Company, a stock dividend or split, reorganization, recapitalization, merger, consolidation, spin-off, combination, combination or transaction or exchange of Common Stock or other corporate exchange, or any distribution to stockholders of Common Stock or other property or securities or any extraordinary cash dividends (other than regular cash dividends) or any transaction similar to the foregoing or other transaction that results in a change to the Company’s capital structure, the Committee shall make an adjustment to the number and kind of shares as to which outstanding options then unexercised shall be exercisable, in the available shares set forth in Section 13, and in the Purchase Period limit under Section 7, so that the proportionate interest of the Participants shall be maintained as before the occurrence of such event; provided, however, that in no event shall any adjustment be made that would cause any option to fail to qualify as an option pursuant to an employee stock purchase plan within the meaning of Section 423 of the Code.

 

(b)    Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, any Offering Period then in progress will be shortened by setting a New Purchase Date, and will terminate immediately prior to the consummation of such proposed dissolution or liquidation, unless provided otherwise by the Administrator. The New Purchase Date will be before the date of the Company’s proposed dissolution or liquidation. The Administrator will notify each Participant in writing or electronically, prior to the New Purchase Date, that the Purchase Date for the Participant’s option has been changed to the New Purchase Date and that the Participant’s option will be exercised automatically on the New Purchase Date, unless prior to such date the Participant has withdrawn from the Offering Period as provided in Section 10 hereof.

 

(c)    Certain Corporate Transactions. In the event of a reorganization, merger, or consolidation of the Company with one or more corporations in which the Company is not the surviving corporation (or survives as a direct or indirect subsidiary of such other constituent corporation or its parent), or upon a sale of substantially all of the property or stock of the Company to another corporation, each outstanding option will be assumed or an equivalent option substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event

 

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that the successor corporation refuses to assume or substitute for the option, the Offering Period with respect to which such option relates will be shortened by setting a New Purchase Date on which such Offering Period shall end. The New Purchase Date will occur before the date of the Company’s proposed merger or Change in Control. The Administrator will notify each Participant in writing or electronically prior to the New Purchase Date, that the Purchase Date for the Participant’s option has been changed to the New Purchase Date and that the Participant’s option will be exercised automatically on the New Purchase Date, unless prior to such date the Participant has withdrawn from the Offering Period as provided in Section 10 hereof.

 

20.    Amendment or Termination.

 

(a)    The Administrator, in its sole discretion, may amend, suspend, or terminate the Plan, or any part thereof, at any time and for any reason. If the Plan is terminated, the Administrator, in its discretion, may elect to terminate the outstanding Offering Period either immediately or upon completion of the purchase of shares of Common Stock on the next Purchase Date (which may be sooner than originally scheduled, if determined by the Administrator in its discretion), or may elect to permit the Offering Period to expire in accordance with its terms (and subject to any adjustment pursuant to Section 19). If the Offering Period is terminated prior to expiration, all amounts then credited to Participants’ accounts that have not been used to purchase shares of Common Stock will be returned to the Participants (without interest thereon) as soon as administratively practicable.

 

(b)    Without Participant consent and without limiting Section 20(a), the Administrator will be entitled to change the Offering Periods, designate separate Offerings, limit the frequency and/or number of changes in the amount withheld during an Offering Period, permit Contributions in excess of the amount designated by a Participant in order to adjust for delays or mistakes in the Company’s processing of properly completed Contribution elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each Participant properly correspond with Contribution amounts, and establish such other limitations or procedures as the Administrator determines in its sole discretion advisable that are consistent with the Plan.

 

(c)    Without limiting the foregoing, in the event the Administrator determines that the ongoing operation of the Plan may result in unfavorable financial accounting consequences, the Administrator may, in its discretion and, to the extent necessary or desirable, modify, amend or terminate the Plan to reduce or eliminate such accounting consequence including, but not limited to:

 

(i)                       amending the Plan to conform with the safe harbor definition under the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor thereto), including with respect to an Offering Period underway at the time;

 

(ii)                    altering the Purchase Price for any Offering Period including an Offering Period underway at the time of the change in Purchase Price;

 

(iii)                 shortening any Offering Period by setting a New Purchase Date, including an Offering Period underway at the time of the Administrator action;

 

(iv)                reducing the maximum percentage of Compensation a Participant may elect to set aside as Contributions; and

 

(v)                   reducing the maximum number of Shares a Participant may purchase during any Offering Period.

 

Such modifications or amendments will not require stockholder approval or the consent of any Plan Participants.

 

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21.    Notices. All notices or other communications by a Participant to the Company under or in connection with the Plan will be deemed to have been duly given when received in the form and manner specified by the Company at the location, or by the person, designated by the Company for the receipt thereof.

 

22.    Conditions Upon Issuance of Shares. Shares of Common Stock will not be issued with respect to an option unless the exercise of such option and the issuance and delivery of such shares pursuant thereto will comply with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act, the Exchange Act, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the shares may then be listed, and will be further subject to the approval of counsel for the Company with respect to such compliance. As a condition to the exercise of an option, the Company may require the person exercising such option to represent and warrant at the time of any such exercise that the shares are being purchased only for investment and without any present intention to sell or distribute such shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned applicable provisions of law.

 

23.    Code Section 409A. The Plan is exempt from the application of Code Section 409A and any ambiguities herein will be interpreted to so be exempt from Code Section 409A. In furtherance of the foregoing and notwithstanding any provision in the Plan to the contrary, if the Administrator determines that an option granted under the Plan may be subject to Code Section 409A or that any provision in the Plan would cause an option under the Plan to be subject to Code Section 409A, the Administrator may amend the terms of the Plan and/or of an outstanding option granted under the Plan, or take such other action the Administrator determines is necessary or appropriate, in each case, without the Participant’s consent, to exempt any outstanding option or future option that may be granted under the Plan from or to allow any such options to comply with Code Section 409A, but only to the extent any such amendments or action by the Administrator would not violate Code Section 409A. Notwithstanding the foregoing, the Company shall have no liability to a Participant or any other party if the option to purchase Common Stock under the Plan that is intended to be exempt from or compliant with Code Section 409A is not so exempt or compliant or for any action taken by the Administrator with respect thereto. The Company makes no representation that the option to purchase Common Stock under the Plan is compliant with Code Section 409A.

 

24.    Term of Plan. The Plan will be effective as of the Effective Date and will continue in effect through the tenth (10th) anniversary thereof, unless sooner terminated under Section 20.

 

25.    Stockholder Approval. The Plan will be subject to approval by the stockholders of the Company. Such stockholder approval will be obtained in the manner and to the degree required under Applicable Laws.

 

26.    Governing Law. The Plan shall be governed by, and construed in accordance with, the laws of the State of Delaware (except its choice-of-law provisions).

 

27.    No Right to Employment. Participation in the Plan by a Participant shall not be construed as giving a Participant the right to be retained as an employee of the Company or a Subsidiary. Furthermore, the Company or a Subsidiary may dismiss a Participant from employment at any time, free from any liability or any claim under the Plan.

 

28.    Severability. If any provision of the Plan is or becomes or is deemed to be invalid, illegal, or unenforceable for any reason in any jurisdiction or as to any Participant, such invalidity, illegality or unenforceability shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as to such jurisdiction or Participant as if the invalid, illegal or unenforceable provision had not been included.

 

29.    Compliance with Applicable Laws. The terms of this Plan are intended to comply with all Applicable Laws and will be construed accordingly.

 

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**************

 

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The foregoing is hereby acknowledged as being the U.S. Xpress Enterprises, Inc. Employee Stock Purchase Plan as adopted and approved by the Board on               , 2018 and by the Company’s stockholders on                  , 2018.

 

	
 
    	
U.S. XPRESS   ENTERPRISES, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Its:
    

 

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EXHIBIT A

 

U.S. XPRESS ENTERPRISES, INC.

EMPLOYEE STOCK PURCHASE PLAN

DESIGNATED COMPANIES

 

1.     U.S. Xpress, Inc.

2.     Total Transportation of Mississippi, LLC

3.     Xpress Internacional, S.A. de C.V.

 

 

EXHIBIT B

 

U.S. XPRESS ENTERPRISES INC.

EMPLOYEE STOCK PURCHASE PLAN

SUBSCRIPTION AGREEMENT

 

	
 
    	
 
    
	
          Original Application
    	
Offering Date:
    
	
          Reduction in Payroll Deduction Rate
    	
 
    

 

 

Capitalized terms used but not otherwise defined herein shall have the meaning given to

such terms in the U.S. Xpress Enterprises, Inc. Employee Stock Purchase Plan.

 

1.    I,                             , hereby elect to participate in the U.S. Xpress Enterprises, Inc. Employee Stock Purchase Plan (the “Plan”) and subscribe to purchase shares of Common Stock in accordance with this Employee Stock Purchase Plan Subscription Agreement (the “Subscription Agreement”) and the Plan.

 

2.    I hereby authorize payroll deductions from each paycheck in the amount of     % of my Compensation on each payday (from 0 to 15%) during the Offering Period in accordance with the Plan. (Please note that no fractional percentages are permitted.)

 

3.    I understand that said payroll deductions will be accumulated for the purchase of shares of Common Stock at the applicable Purchase Price determined in accordance with the Plan. I understand that if I do not withdraw from an Offering Period, any accumulated payroll deductions will be used to automatically exercise my option and purchase Common Stock under the Plan.

 

4.    I have received a copy of the complete Plan and its accompanying prospectus. I understand that my participation in the Plan is in all respects subject to the terms of the Plan. The Company reserves the right to modify the Plan and to impose other requirements on my participation in the Plan, on the option and on any shares of Common Stock purchased under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons. I agree to be bound by such modifications regardless of whether notice is given to me of such event, subject, in any case, to my right to withdrawal from participation in the Plan. I further agree to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

 

5.    I hereby agree to be bound by the terms of the Plan and this Subscription Agreement. The effectiveness of this Subscription Agreement is dependent upon my eligibility to participate in the Plan.

 

	
Employee’s Tax ID Number:
    	
 
    	
 
    	
 
    

 

I ACKNOWLEDGE AND UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT INCLUDING ITS APPENDICES AND MY PARTICIPATION IN THE PLAN WILL REMAIN IN EFFECT THROUGHOUT SUCCESSIVE OFFERING PERIODS UNLESS AFFIRMATIVELY TERMINATED BY ME.

 

	
Dated:
    	
 
    	
 
    
	
Signature of Employee:Exhibit 10.7

 

Amended and Restated Executive

Employment Agreement

 

This Amended and Restated Executive Employment Agreement (the “Amended Agreement”) is made and entered into as of April 30, 2018, and amends and restates the Employment Agreement by and between WILLIAM ERIC FULLER (the “Executive”), U.S. XPRESS ENTERPRISES, INC., a Nevada corporation (the “Company”), and NEW MOUNTAIN LAKE HOLDINGS, LLC (the “Parent Company”), originally entered into on March 14, 2017 (the “Original Agreement”).

 

In consideration of the mutual covenants, promises, and obligations set forth herein, the parties agree as follows:

 

1.                            Term. The Executive’s employment hereunder shall be effective as of March 14, 2017.  This Amended Agreement shall be effective as of April 30, 2018  (the “Effective Date”)and shall continue until the third anniversary thereof, unless terminated earlier pursuant to Section 5 of this Amended Agreement; provided that, on such third anniversary of the Effective Date and each annual anniversary thereafter (such date and each annual anniversary thereof, a “Renewal Date”), the Amended Agreement shall be deemed to be automatically extended, upon the same terms and conditions, for successive periods of one year, unless either party provides written notice of its intention not to extend the term of the Amended Agreement at least 90 days prior to the applicable Renewal Date.  The period during which the Executive is employed by the Company hereunder is hereinafter referred to as the “Employment Term.”   If a Change in Control, as defined in Section 5.4 hereof, occurs, the Amended Agreement shall be deemed to be automatically extended for two (2) years from the date of such Change in Control, provided however that this provision shall not operate to reduce the Employment Term to any period of less than three (3) years.

 

2.                            Position and Duties.

 

2.1                               Position. During the Employment Term, the Executive shall serve as the President and Chief Executive Officer of the Company, reporting to the board of directors of the Company (the “Board”).  In such position, the Executive shall have such duties, authority, and responsibility as shall be determined from time to time by the Board, which duties, authority, and responsibility are consistent with the Executive’s position. The Executive shall, if requested, also serve as a member of the Board, an officer and/or director of the Parent Company, or as an officer and/or director of any other affiliate of the Company for no additional compensation.

 

2.2                               Duties. During the Employment Term, the Executive shall devote substantially all of his business time and attention to the performance of the Executive’s duties hereunder and will not engage in any other business, profession, or occupation for compensation or otherwise which would conflict or interfere with the performance of such services either directly or indirectly without the prior written consent of the Board. Notwithstanding the foregoing, the Executive will be permitted to (a) act or serve as a director, trustee, committee member, or principal of any type of business, civic, or charitable organization as

 

 

long as such activities are disclosed in writing to the Company’s General Counsel in accordance with the Company’s Conflict of Interest Policy; and (b) purchase or own less than five percent (5%) of the publicly traded securities of any corporation, provided that, such ownership represents a passive investment and that the Executive is not a controlling person of, or a member of a group that controls, such corporation; provided further that, the activities described in clauses (a) and (b) do not interfere with the performance of the Executive’s duties and responsibilities to the Company as provided hereunder, including, but not limited to, the obligations set forth in Section 2 hereof.

 

3.                            Place of Performance. The principal place of Executive’s employment shall be the Company’s principal executive office currently located in Chattanooga, Tennessee; however, the Executive may be required to travel on Company business during the Employment Term.

 

4.                            Compensation.

 

4.1                               Base Salary. The Company shall pay the Executive an annual base salary of $750,000.00 (“Base Salary”).  Such Base Salary shall be paid in periodic installments in accordance with the Company’s customary payroll practices and applicable wage payment laws, but no less frequently than monthly. The Executive’s Base Salary shall be reviewed at least annually by a compensation committee of the Board (the “Compensation Committee”), and the Compensation Committee shall review the Base Salary in comparison to comparable executive positions, either within the industry or within companies of similar size, and may, but shall not be required to, increase the Base Salary during the Employment Term. However, the Executive’s Base Salary may not be decreased during the Employment Term other than as part of an across-the-board salary reduction that applies in the same manner to all senior executives. The Executive’s annual Base Salary, as in effect from time to time, is herein referred to as “Base Salary”.

 

4.2                               Annual Bonus.   For each complete calendar year of the Employment Term, the Executive shall be eligible to participate in the U.S. Xpress Annual Short Term Incentive Profit Sharing Plan, or such other bonus incentive plan as may be adopted by the Compensation Committee from time to time (the “Incentive Bonus Plan”), and receive an annual bonus pursuant thereto (the “Annual Bonus”). The Executive’s annual target bonus opportunity shall be defined annually by the Compensation Committee and shall be equal to or greater than 100% of Base Salary (the “Target Bonus”), based on the achievement of Company performance goals as established by the Compensation Committee; provided that, depending on results, the Executive’s actual bonus may be higher or lower than the Target Bonus, as determined by the Compensation Committee. For the period beginning on the Effective Date and ending on the last day of the applicable calendar year, the Executive shall be eligible to receive the full Annual Bonus calculated as though he had worked in his current position for the full calendar year.  Except as otherwise provided in Section 5, the Annual Bonus will be subject to the terms of the Company’s Incentive Bonus Plan under which it is granted,  and, in order to be eligible to receive an Annual Bonus, the Executive must be employed by the Company on the date that Annual Bonuses are paid.

 

4.3                               Executive Incentive Plan.   The Executive shall be eligible to participate in an Executive Incentive Plan, to be defined and adopted by the Board on or before the first

 

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anniversary of the Effective Date of this Amended Agreement, through which the Executive may be eligible to receive an Annual Executive Incentive Bonus, consisting of cash, stock and/or any other compensation deemed appropriate by the Compensation Committee, subject to meeting prerequisite criteria as established by the Board.

 

4.4                               Timing of Bonus Payments.  All incentive bonus payments described in Section 4 shall be paid to the Executive, to the extent earned, in no event later than March 15 of the year following the calendar year to which it relates, such that the payments qualify as a “short-term deferral” for purposes of Section 409A of the Internal Revenue Code of 1986 or its successor (respectively, “Section 409A” and the “Code”).

 

4.5                               Initial Equity Award. During the first year of the Original Agreement, the Executive shall be awarded 80,000 shares of restricted membership units in the Parent Company (the “NMLH Restricted Units”), pursuant to the New Mountain Lake Holdings, LLC Restricted Membership Units Plan (the “Membership Units Plan”).

 

4.6                               Fringe Benefits and Perquisites. During the Employment Term, the Executive shall be entitled to fringe benefits and perquisites consistent with the practices of the Company, and to the extent the Company provides similar benefits or perquisites (or both) to similarly situated executives of the Company, including, but not limited to, all benefits available under the Company’s Xpre$$avings 401(k) Plan, Section 125 Cafeteria Plan, Section 105 Plan, Non-Qualified Deferred Compensation Plan, and such other employee benefit plans as may be adopted from time to time, a medical allowance that reimburses the Executive the premium cost for such major medical, dental and vision plans as elected by the Executive under the Company’s Section 125 Plan, executive disability insurance, a term life policy in the amount of $5,000,000, personal use of the Company’s plane (limited to $125,000 per year) that does not interfere with the Company’s business and that occurs at reasonable times and in a reasonable manner, and intermittent personal use of the Company’s passenger automobiles, all of which shall be taxed as required by IRS regulations.  Notwithstanding the foregoing, during the Employment Term, the Company shall provide the Executive with a car allowance in the amount of $600.00 per month.  In addition, the Company shall pay all professional dues, taxes and educational costs associated with maintaining Executive’s industry knowledge.

 

4.7                               Employee Benefits. During the Employment Term, the Executive shall be entitled to participate in all employee benefit plans, practices, and programs maintained by the Company, as in effect from time to time (collectively, “Employee Benefit Plans”), on a basis which is no less favorable than is provided to other similarly situated executives of the Company, to the extent consistent with applicable law and the terms of the applicable Employee Benefit Plans. The Company reserves the right to amend or cancel any Employee Benefit Plans at any time in its sole discretion, subject to the terms of such Employee Benefit Plan and applicable law.

 

4.8                               Vacation; Paid Time-Off. During the Employment Term, the Executive will be entitled to take such paid vacation and other time off on a basis that is at least as favorable as that provided to other similarly situated executives of the Company. The Executive shall

 

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receive other paid time-off in accordance with the Company’s policies for executive officers, as such policies may exist from time to time.

 

4.9                               Relocation Expenses. In the event that the Executive relocates at the request of the Company, the Company shall pay, or reimburse the Executive for, all reasonable relocation expenses incurred by the Executive relating to his relocation to in accordance with the terms of the Company’s relocation policy.

 

4.10                        Business Expenses. The Executive shall be entitled to reimbursement for all reasonable and necessary out-of-pocket business, entertainment, and travel expenses incurred by the Executive in connection with the performance of the Executive’s duties hereunder in accordance with the Company’s expense reimbursement policies and procedures.

 

4.11                        Indemnification.

 

(a)                                 In the event that the Executive is made a party or threatened to be made a party to any action, suit, or proceeding, whether civil, criminal, administrative, or investigative (a “Proceeding”), other than any Proceeding initiated by the Executive or the Company related to any contest or dispute between the Executive and the Company or any of its affiliates with respect to this Amended Agreement or the Executive’s employment hereunder, by reason of the fact that the Executive is or was a director or officer of the Company, or any affiliate of the Company, or is or was serving at the request of the Company as a director, officer, member, employee, or agent of another corporation or a partnership, joint venture, trust, or other enterprise, the Executive shall be indemnified and held harmless by the Company to the maximum extent permitted under applicable law and the Company’s bylaws from and against any liabilities, costs, claims, and expenses, including all costs and expenses incurred in defense of any Proceeding (including attorneys’ fees). Costs and expenses incurred by the Executive in defense of such Proceeding (including attorneys’ fees) shall be paid by the Company in advance of the final disposition of such litigation upon receipt by the Company of: (i) a written request for payment; and (ii) appropriate documentation evidencing the incurrence, amount, necessity, and nature of the costs and expenses for which payment is being sought.  Notwithstanding the foregoing, the Executive shall not be entitled to indemnification pursuant to this Section 4.12 if the Proceeding arises from or relates to the Executive’s intentional, willful, or fraudulent misconduct. If it shall ultimately be determined that the Executive is not entitled to be indemnified by the Company under this Amended Agreement, the Executive agrees to repay the amounts so paid.

 

(b)                                 During the Employment Term and for a period of six (6) years thereafter, the Company or any successor to the Company shall purchase and maintain, at its own expense, directors’ and officers’ liability insurance providing coverage to the Executive on terms that are no less favorable than the coverage provided to other directors and similarly situated executives of the Company.

 

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4.12                        Clawback Provisions. Notwithstanding any other provisions in this Amended Agreement to the contrary, any incentive-based compensation, or any other compensation, paid to the Executive pursuant to this Amended Agreement or any other  agreement or arrangement with the Company which is subject to recovery under any law, government regulation, or stock exchange listing requirement, will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation, or stock exchange listing requirement (or any policy adopted by the Company pursuant to any such law, government regulation or stock exchange listing requirement).

 

5.                            Termination of Employment. The Employment Term and the Executive’s employment hereunder may be terminated by either the Company or the Executive at any time and for any reason; provided that, unless otherwise provided herein, either party shall be required to give the other party at least 90 days advance written notice of any termination of the Executive’s employment. Upon termination of the Executive’s employment during the Employment Term, the Executive shall be entitled to the compensation and benefits described in this Section 5 and shall have no further rights to any compensation or any other benefits from the Company or any of its affiliates.

 

5.1                               For Cause or Without Good Reason.

 

(a)                                 If the Executive’s employment is terminated by the Company for Cause or by the Executive without Good Reason, the Executive shall be entitled to receive:

 

(i)                                           any accrued but unpaid Base Salary which shall be paid on the pay date immediately following the Termination Date (as defined below) in accordance with the Company’s customary payroll procedures;

 

(ii)                                        any earned but unpaid Annual Bonus with respect to any completed calendar year immediately preceding the Termination Date, which shall be paid on the otherwise applicable payment date provided that, if the Executive’s employment is terminated by the Company for Cause, then any such accrued but unpaid Annual Bonus shall be forfeited;

 

(iii)                                     reimbursement for unreimbursed business expenses properly incurred by the Executive, which shall be subject to and paid in accordance with the Company’s expense reimbursement policy; and

 

(iv)                                    such employee benefits (including equity compensation), if any, to which the Executive may be entitled under the Company’s employee benefit plans as of the Termination Date; provided that, in no event shall the Executive be entitled to any payments in the nature of severance or termination payments except as specifically provided herein.

 

Items 5.1(a)(i) through 5.1(a)(iv) are referred to herein collectively as the “Accrued Amounts.”

 

(b)                                 For purposes of this Amended Agreement, “Cause” shall mean:

 

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(i)                                           the Executive’s willful engagement in dishonesty, illegal conduct, or gross misconduct, which is, in each case, injurious to the Company or its affiliates;

 

(ii)                                        the Executive’s embezzlement, misappropriation, or fraud, whether or not related to the Executive’s employment with the Company;

 

(iii)                                     the Executive’s conviction of or plea of guilty or nolo contendere to a crime that constitutes a felony (or state law equivalent) or a crime that constitutes a misdemeanor involving moral turpitude, if such felony or other crime is work-related, materially impairs the Executive’s ability to perform services for the Company or results in material reputational or financial harm to the Company or its affiliates; or

 

(iv)                                    the Executive’s willful unauthorized disclosure of Confidential Information (as defined below).

 

For purposes of this provision, no act or failure to act on the part of the Executive shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company.

 

Termination of the Executive’s employment shall not be deemed to be for Cause unless and until the Company delivers to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the Board (after reasonable written notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be heard before the Board), finding that the Executive has engaged in the conduct described in any of (i)-(iv) above.  Except for a failure, breach, or refusal which, by its nature, cannot reasonably be expected to be cured, the Executive shall have ten (10) business days from the delivery of written notice by the Company within which to cure any acts constituting Cause; provided however, that, if the Company reasonably expects irreparable injury from a delay of ten (10) business days, the Company may give the Executive notice of such shorter period within which to cure as is reasonable under the circumstances, which may include the termination of the Executive’s employment without notice and with immediate effect.  The Company may place the Executive on paid leave for up to 90 days while it is determining whether there is a basis to terminate the Executive’s employment for Cause. Any such action by the Company will not constitute Good Reason.

 

(c)                                  For purposes of this Amended Agreement, “Good Reason” shall mean the occurrence of any of the following, in each case during the Employment Term without the Executive’s written consent:

 

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(i)                                           a material reduction in the Executive’s Base Salary, other than a general reduction in Base Salary that affects all similarly situated executives in substantially the same proportions;

 

(ii)                                        a material reduction in the Executive’s Annual Bonus opportunity, other than a general reduction that affects all similarly situated executives in substantially the same proportions;

 

(iii)                                     a relocation of the Executive’s principal place of employment to another state or by more than 50 miles;

 

(iv)                                    any material breach by the Company of any material provision of this Amended Agreement;

 

(v)                                       the Company’s failure to obtain an agreement from any successor to the Company to assume and agree to perform this Amended Agreement in the same manner and to the same extent that the Company would be required to perform if no succession had taken place, except where such assumption occurs by operation of law;

 

(vi)                                    a material, adverse change in the Executive’s title, authority, duties, or responsibilities (other than temporarily while the Executive is physically or mentally incapacitated or as required by applicable law) taking into account the Company’s size, status as a public company, and capitalization as of the date of this Amended Agreement; excluding however such changes in title, authority, duties, or responsibilities as are occasioned by the IPO and the Company’s status thereafter as a public company; or

 

(vii)                                 a material adverse change in the reporting structure applicable to the Executive.

 

The Executive cannot terminate his employment for Good Reason unless he has provided written notice to the Company of the existence of the circumstances providing grounds for termination for Good Reason within 90 days of the initial existence of such grounds and the Company has had at least 30 days from the date on which such notice is provided to cure such circumstances. If the Executive does not terminate his employment for Good Reason within 30 days of the expiration of such cure period, then the Executive will be deemed to have waived his right to terminate for Good Reason with respect to such grounds.

 

5.2                               Non-Renewal by the Company, Without Cause or for Good Reason. The Employment Term and the Executive’s employment hereunder may be terminated by the Executive for Good Reason or by the Company without Cause or on account of the Company’s failure to renew the Amended Agreement in accordance with Section 1. In the event of such termination, the Executive shall be entitled to receive the Accrued Amounts set forth in Sections 5.1(a)(i)-(iv).  In addition, and subject to the Executive’s compliance with Section 6, Section 7, Section 8, and Section 9 of this Amended Agreement and his execution of a release of claims in favor of the Company, its affiliates and their respective

 

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officers and directors in a form provided by the Company (the “Release”) and such Release becoming effective within 28 days following the Termination Date, as determined in accordance with Section 5.6 hereto, (such 28-day period, the “Release Execution Period”), the Executive shall also be entitled to receive the following:

 

(a)                                 Equal installment payments that in the aggregate are equal to the sum of:

 

(i)                   Three (3) times the Executive’s Base Salary for the year in which the Termination Date occurs, and

 

(ii)    One and one-half (1.5) times the Executive’s Target Bonus  for the year in which the Termination Date occurs,

 

such installments to be paid over a period not to exceed 36 months, no less frequently than monthly, and in accordance with the Company’s normal payroll practices,  beginning immediately upon expiration of the Release Execution Period, provided that the Release is effective prior to the expiration of the Release Execution Period. The first installment payment shall include all amounts that would otherwise have been paid to the Executive during the period beginning on the Termination Date and ending on the first payment date as if no delay had been imposed;

 

(b)                                 A payment equal to the product of (i) the Annual Bonus, if any, that the Executive would have earned for the calendar year in which the Termination Date occurs based on achievement of the applicable performance goals for such year and (ii) a fraction, the numerator of which is the number of days the Executive was employed by the Company during the year of termination and the denominator of which is the number of days in such year (the “Pro-Rata Bonus”). This amount shall be paid on the date that annual bonuses are paid to similarly situated executives, but in no event prior to the expiration of the Release Execution Period nor later than two-and-a-half (2 1/2) months following the end of the calendar year in which the Termination Date occurs;

 

(c)                                  If the Executive timely and properly elects health continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Company shall reimburse the Executive for the monthly COBRA premium paid by the Executive for himself and his dependents. Such reimbursement shall be paid to the Executive by the 15th day of the month immediately following the month in which the Executive timely remits the premium payment. The Executive shall be eligible to receive such reimbursement until the earliest of: (i) the eighteen (18) month anniversary of the Termination Date; (ii) the date the Executive is no longer eligible to receive COBRA continuation coverage; and (iii) the date on which the Executive becomes eligible to receive substantially similar coverage from another employer or other source. Notwithstanding the foregoing, if the Company’s making payments under this Section 5.2(c) would violate the nondiscrimination rules applicable to non-grandfathered plans under the Affordable Care Act (the “ACA”), or result in the imposition of penalties under the ACA and the related regulations and

 

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guidance promulgated thereunder), the parties agree to reform this Section 5.2(c) in a manner as is necessary to comply with the ACA or such other law governing employer provided healthcare plans as may be enacted.

 

(d)                                 The treatment of any outstanding equity awards shall be determined in accordance with the terms of the 2017 Stock Appreciation Rights Plan, the Membership Units Plan, the 2018 Omnibus Incentive Plan, or any other applicable award agreements.

 

5.3                               Death or Disability.

 

(a)                                 The Executive’s employment hereunder shall terminate automatically upon the Executive’s death during the Employment Term, and the Company may terminate the Executive’s employment on account of the Executive’s Disability.

 

(b)                                 If the Executive’s employment is terminated during the Employment Term on account of the Executive’s death or Disability, the Executive (or the Executive’s estate and/or beneficiaries, as the case may be) shall be entitled to receive the following:

 

(i)                                           the Accrued Amounts; and

 

(ii)                                        a lump sum payment equal to the product of: (A) the Executive’s Target Bonus for the year in which the Termination Date occurs and (B) a fraction, the numerator of which is the number of days the Executive was employed by the Company during the year in which the Termination Date occurs and the denominator of which is the number of days in such year, which shall be paid within 60 days following the Termination Date.

 

Notwithstanding any other provision contained herein, all payments made in connection with the Executive’s Disability shall be provided in a manner which is consistent with federal and state law.

 

(c)                                  For purposes of this Amended Agreement, “Disability” shall mean the Executive is entitled to receive long-term disability benefits under the Company’s long-term executive disability plan, or if there is no such plan, the Executive’s inability, due to physical or mental incapacity, to perform the essential functions of his job, with or without reasonable accommodation, for one hundred eighty (180) days out of any three hundred sixty-five (365) day period; provided however, in the event that the Company temporarily replaces the Executive, or transfers the Executive’s duties or responsibilities to another individual on account of the Executive’s inability to perform such duties due to a mental or physical incapacity which is, or is reasonably expected to become, a Disability, then the Executive’s employment shall not be deemed terminated by the Company and the Executive shall not be able to resign with Good Reason as a result thereof. Any question as to the existence of the Executive’s Disability as to which the Executive and the Company cannot agree shall be determined in writing by a qualified independent physician mutually acceptable to the

 

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Executive and the Company. If the Executive and the Company cannot agree as to a qualified independent physician, each shall appoint such a physician and those two physicians shall select a third who shall make such determination in writing. The determination of Disability made in writing to the Company and the Executive shall be final and conclusive for all purposes of this Amended Agreement.

 

5.4                               Change in Control Termination.

 

(a)                                 Notwithstanding any other provision contained herein, if the Executive’s employment hereunder is terminated by the Executive for Good Reason or by the Company on account of its failure to renew the Amended Agreement in accordance with Section 1 or without Cause (other than on account of the Executive’s death or Disability), and such termination occurs within twenty-four (24) months following a Change in Control, the Executive shall be entitled to receive the Accrued Amounts and, subject to the Executive’s compliance with Section 6, Section 7, Section 8 and Section 9 of this Amended Agreement and his execution of a Release which becomes effective within 28 days following the Termination Date, the Executive shall be entitled to receive all of the benefits set forth in Section 5.2, subject to the following modifications:

 

(i)                                     the equal installment payments set forth in Paragraph 5.2(a) shall be paid in a lump sum equal to the sum of three (3) times the Executive’s Base Salary and one-and-one-half (1.5) times the Target Bonus for either the year in which the Termination Date occurs or the year immediately preceding the year in which the Change in Control occurs (whichever is greater);

 

(ii)                            the lump sum payment set forth in Paragraph 5.2(b) shall equal the Executive’s Target Bonus for either the calendar year in which the Termination Date (as determined in accordance with Section 5.6) occurs or the year in which the Change in Control occurs (whichever is greater).  Such amount shall not be subject to pro-ration based on the percentage of the year worked and shall be paid within sixty (60) days following the Termination Date.

 

(b)                                 For purposes of this Amended Agreement, “Change in Control” shall mean the occurrence of any of the following after the Effective Date:

 

(i)                                     one person (or more than one person acting as a group) acquires ownership of stock of the Company that, together with the stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of such corporation; provided that, a Change in Control shall not occur if any person (or more than one person acting as a group) holding at least 45% of the total fair market value or total voting power of the Company’s stock on the Effective Date acquires additional stock;

 

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(ii)                                  a majority of the members of the Board are replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority of the Board before the date of appointment or election; or

 

(iii)                               the sale of all or substantially all of the Company’s assets.

 

Notwithstanding the foregoing, a Change in Control shall not occur unless such transaction constitutes a change in the ownership of the Company, a change in effective control of the Company, or a change in the ownership of a substantial portion of the Company’s assets under Section 409A.

 

5.5                               Notice of Termination. Any termination of the Executive’s employment hereunder by the Company or by the Executive during the Employment Term (other than termination pursuant to Section 5.3(a) on account of the Executive’s death) shall be communicated by written notice of termination (“Notice of Termination”) to the other party hereto in accordance with Section 25. The Notice of Termination shall specify:

 

(a)                                 The termination provision of this Amended Agreement relied upon; and

 

(b)                                 The applicable Termination Date.

 

5.6                               Termination Date. The Executive’s “Termination Date” shall be:

 

(a)                                 If the Executive’s employment hereunder terminates on account of the Executive’s death, the date of the Executive’s death;

 

(b)                                 If the Executive’s employment hereunder is terminated on account of the Executive’s Disability, the date that it is determined that the Executive has a Disability;

 

(c)                                  If the Company terminates the Executive’s employment hereunder for Cause, the date the Notice of Termination is delivered to the Executive;

 

(d)                                 If the Company terminates the Executive’s employment hereunder without Cause, the date specified in the Notice of Termination, which shall be no less than 90 days following the date on which the Notice of Termination is delivered; provided that, the Company shall have the option to provide the Executive with a lump sum payment equal to 90 days’ Base Salary in lieu of such notice, which shall be paid in a lump sum on the Executive’s Termination Date and for all purposes of this Amended Agreement, the Executive’s Termination Date shall be the date on which such Notice of Termination is delivered;

 

(e)                                  If the Executive terminates his employment hereunder with or without Good Reason, the date specified in the Executive’s Notice of Termination, which shall be no less than 90 days following the date on which the Notice of Termination is delivered; provided that, the Company may waive all or any part of the 90 day notice period for no consideration by giving written notice to the Executive, and for all

 

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purposes of this Amended Agreement, the Executive’s Termination Date shall be the date determined by the Company; and

 

(f)                                   If the Executive’s employment hereunder terminates because either party provides notice of non-renewal pursuant to Section 1, the Renewal Date immediately following the date on which the applicable party delivers notice of non-renewal.

 

Notwithstanding anything contained herein, the Termination Date shall not occur until the date on which the Executive incurs a “separation from service” within the meaning of Section 409A.

 

5.7                               Mitigation. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Amended Agreement.  Furthermore, except as provided in Section 5.2(c), amounts payable pursuant to this Section 5 shall not be reduced by compensation the Executive earns on account of employment with another employer.

 

5.8                               Resignation of All Other Positions. Upon termination of the Executive’s employment hereunder for any reason, the Executive shall be deemed to have resigned from all positions that the Executive holds as an officer or member of the Board (or a committee thereof) of the Company or any of its subsidiaries.

 

5.9                               Section 280G.

 

(a)                                 If any of the payments or benefits received or to be received by the Executive (including, without limitation, any payment or benefits received in connection with a Change in Control or the Executive’s termination of employment, whether pursuant to the terms of this Amended Agreement or any other plan, arrangement, or agreement, or otherwise) (all such payments collectively referred to herein as the “280G Payments”) constitute “parachute payments” within the meaning of Section 280G of the Code and,  but for this Section 5.9, would be subject to the excise tax imposed under Section 4999 of the Code (the “Excise Tax”),. then prior to making the 280G Payments, a calculation shall be made comparing (i) the Net Benefit (as defined below) to the Executive of the 280G Payments after payment of the Excise Tax to (ii) the Net Benefit to the Executive if the 280G Payments are limited to the extent necessary to avoid being subject to the Excise Tax. Only if the amount calculated under (i) above is less than the amount under (ii) above will the 280G Payments be reduced to the minimum extent necessary to ensure that no portion of the 280G Payments is subject to the Excise Tax. “Net Benefit” shall mean the present value of the 280G Payments net of all federal, state, local, foreign income, employment, and excise taxes. Any reduction made pursuant to this Section 5.9 shall be made in a manner determined by the Company that is consistent with the requirements of Section 409A.

 

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(b)                                 All calculations and determinations under this Section 5.9 shall be made by an independent accounting firm or independent tax counsel appointed by the Company (the “Tax Counsel”) whose determinations shall be conclusive and binding on the Company and the Executive for all purposes. For purposes of making the calculations and determinations required by this Section 5.9, the Tax Counsel may rely on reasonable, good faith assumptions and approximations concerning the application of Section 280G and Section 4999 of the Code. The Company and the Executive shall furnish the Tax Counsel with such information and documents as the Tax Counsel may reasonably request to make its determinations under this Section 5.9. The Company shall bear all costs the Tax Counsel may reasonably incur in connection with its services.

 

6.                            Cooperation. The parties agree that certain matters in which the Executive will be involved during the Employment Term may necessitate the Executive’s cooperation in the future. Accordingly, following the termination of the Executive’s employment for any reason, to the extent reasonably requested by the Board, the Executive shall cooperate with the Company in connection with matters arising out of the Executive’s service to the Company; provided that, the Company shall make reasonable efforts to minimize disruption of the Executive’s other activities. The Company shall reimburse the Executive for reasonable expenses incurred in connection with such cooperation and, to the extent that the Executive is required to spend substantial time on such matters, the Company shall compensate the Executive at an hourly rate based on the Executive’s Base Salary on the Termination Date.

 

7.                            Confidential Information. The Executive understands and acknowledges that during the Employment Term, he will have access to and learn about Confidential Information, as defined below.

 

7.1                               Confidential Information Defined.

 

(a)                                 Definition.

 

For purposes of this Amended Agreement, “Confidential Information” includes, but is not limited to, all information not generally known to the public, in spoken, printed, electronic or any other form or medium, relating directly or indirectly to: business processes, practices, methods, policies, plans, publications, documents, research, operations, services, strategies, techniques, agreements, contracts, terms of agreements, transactions, potential transactions, negotiations, pending negotiations, trade secrets, computer programs, computer software, applications, operating systems, software design, web design, databases, manuals, records, articles, systems, vendor information, financial information, results, accounting information, accounting records, legal information, marketing information, advertising information, pricing information, credit information, design information, payroll information, staffing information, personnel information, employee lists, supplier lists, vendor lists, developments, reports, internal controls, security procedures, graphics, drawings, sketches, market studies, sales information, revenue, costs, formulae, notes, communications, algorithms, product plans, designs, styles, models, ideas, specifications, customer information, and customer lists of the

 

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Company or its businesses or any existing or prospective customer, supplier, investor or other associated third party, or of any other person or entity that has entrusted information to the Company in confidence.

 

The Executive understands that the above list is not exhaustive, and that Confidential Information also includes other information that is marked or otherwise identified as confidential or proprietary, or that would otherwise appear to a reasonable person to be confidential or proprietary in the context and circumstances in which the information is known or used.

 

The Executive understands and agrees that Confidential Information includes information developed by him in the course of his employment by the Company as if the Company furnished the same Confidential Information to the Executive in the first instance. Confidential Information shall not include information that is generally available to and known by the public at the time of disclosure to the Executive; provided that, such public availability or knowledge of the information is through no direct or indirect fault of the Executive or person(s) acting on the Executive’s behalf.

 

(b)                                 Company Creation and Use of Confidential Information.

 

The Executive understands and acknowledges that the Company has invested, and continues to invest, substantial time, money, and specialized knowledge into developing its resources, creating a customer base, generating customer and potential customer lists, training its employees, developing its business plans and strategies, and improving its offerings in the field of trucking and logistics. The Executive understands and acknowledges that as a result of these efforts, the Company has created, and continues to use and create Confidential Information. This Confidential Information provides the Company with a competitive advantage over others in the marketplace.

 

(c)                                  Disclosure and Use Restrictions.

 

The Executive agrees and covenants: (i) to treat all Confidential Information as strictly confidential; (ii) not to directly or indirectly disclose, publish, communicate, or make available Confidential Information, or allow it to be disclosed, published, communicated, or made available, in whole or part, to any entity or person whatsoever (including other employees of the Company) not having a need to know and authority to know and use the Confidential Information in connection with the business of the Company and, in any event, not to anyone outside of the direct employ of the Company except as required in the performance of the Executive’s authorized employment duties to the Company or with the prior consent of the Board acting on behalf of the Company in each instance (and then, such disclosure shall be made only within the limits and to the extent of such duties or consent); and (iii) not to access or use any Confidential Information, and not to copy any documents, records, files, media, or other resources containing any Confidential Information, or remove any such documents, records, files, media, or other resources from the premises or control of the Company, except as required in the performance of the Executive’s authorized

 

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employment duties to the Company or with the prior consent of the Board acting on behalf of the Company in each instance (and then, such disclosure shall be made only within the limits and to the extent of such duties or consent). Nothing herein shall be construed to prevent disclosure of Confidential Information as may be required by applicable law or regulation, or pursuant to the valid order of a court of competent jurisdiction or an authorized government agency, provided that the disclosure does not exceed the extent of disclosure required by such law, regulation, or order. The Executive shall promptly provide written notice of any such order to the Corporate General Counsel.

 

(d)                                 Notice of Immunity Under the Economic Espionage Act of 1996, as amended by the Defend Trade Secrets Act of 2016 (“DTSA”). Notwithstanding any other provision of this Amended Agreement:

 

(i)                                     The Executive will not be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that:

 

(A)                               is made (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (2) solely for the purpose of reporting or investigating a suspected violation of law; or

 

(B)                               is made in a complaint or other document filed under seal in a lawsuit or other proceeding.

 

(ii)                                  If the Executive files a lawsuit for retaliation by the Company for reporting a suspected violation of law, the Executive may disclose the Company’s trade secrets to the Executive’s attorney and use the trade secret information in the court proceeding if the Executive:

 

(A)                               files any document containing trade secrets under seal; and

 

(B)                               does not disclose trade secrets, except pursuant to court order.

 

The Executive understands and acknowledges that his obligations under this Amended Agreement with regard to any particular Confidential Information shall commence immediately upon the Executive first having access to such Confidential Information (whether before or after he begins employment by the Company) and shall continue during and after his employment by the Company until such time as such Confidential Information has become public knowledge other than as a result of the Executive’s breach of this Amended Agreement or breach by those acting in concert with the Executive or on the Executive’s behalf.

 

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8.                            Restrictive Covenants.

 

8.1                               Acknowledgement. The Executive understands that the nature of the Executive’s position gives him access to and knowledge of Confidential Information and places him in a position of trust and confidence with the Company. The Executive understands and acknowledges that the intellectual, legal, and managerial services he provides to the Company are unique, special, or extraordinary.

 

The Executive further understands and acknowledges that the Company’s ability to reserve these for the exclusive knowledge and use of the Company is of great competitive importance and commercial value to the Company, and that improper use or disclosure by the Executive is likely to result in unfair or unlawful competitive activity.

 

8.2                               Non-Competition. Because of the Company’s legitimate business interest as described herein and the good and valuable consideration offered to the Executive, the Executive agrees and covenants not to engage in Prohibited Activity within the United States during the Non-Competition Period on behalf of any truckload carrier, or affiliated family of truckload carriers, which individually or collectively operate at least 4,000 power units.  This restriction applies irrespective of whether Executive’s employment with the Company is terminated at the option of the Executive or the Company or whether such termination is with or without Cause or Good Reason.

 

For purposes of this Section 8, “Prohibited Activity” is activity in which the Executive contributes his knowledge, directly or indirectly, in whole or in part, as an employee, employer, owner, operator, manager, advisor, consultant, agent, employee, partner, director, stockholder, officer, volunteer, intern, or any other similar capacity to an entity engaged in the same or similar business as the Company, including those engaged in the business of trucking and/or logistics. Prohibited Activity also includes activity that may require or inevitably requires disclosure of trade secrets, proprietary information or Confidential Information.

 

For purposes of this Section 8, “Non-Competition Period” means during the Employment Term plus (i) one year if Executive is not eligible for and receiving the benefits set forth in Section 5.2 or Section 5.4, or (ii) two years if Executive is eligible for and receiving the benefits set forth in Section 5.2 or Section 5.4, to run consecutively, beginning on the last day of the Executive’s employment with the Company.

 

Nothing herein shall prohibit the Executive from purchasing or owning less than five percent (5%) of the publicly traded securities of any corporation, provided that such ownership represents a passive investment and that the Executive is not a controlling person of, or a member of a group that controls, such corporation.

 

This Section 8 does not, in any way, restrict or impede the Executive from exercising protected rights to the extent that such rights cannot be waived by agreement or from complying with any applicable law or regulation or a valid order of a court of competent jurisdiction or an authorized government agency, provided that such compliance does not exceed that required by the law, regulation, or order. The Executive shall promptly provide written notice of any such order to Corporate General Counsel.

 

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8.3                               Non-Solicitation of Employees. The Executive agrees and covenants not to directly or indirectly solicit, hire, recruit, attempt to hire or recruit, or induce the termination of employment of any employee of the Company during the Non-Competition Period.

 

8.4                               Non-Solicitation of Customers. The Executive understands and acknowledges that because of the Executive’s experience with and relationship to the Company, he will have access to and learn about much or all of the Company’s Customer Information. “Customer Information” includes, but is not limited to, names, phone numbers, addresses, e-mail addresses, order history, order preferences, chain of command, pricing information, and other information identifying facts and circumstances specific to the customer and relevant to sales and/or services.

 

The Executive understands and acknowledges that loss of its customer relationships and/or goodwill will cause significant and irreparable harm.

 

The Executive agrees and covenants that, during the Non-Competition Period, he will not directly or indirectly solicit, contact (including but not limited to e-mail, regular mail, express mail, telephone, fax, and instant message), attempt to contact, or meet with the Company’s current, former or prospective customers for purposes of offering or accepting goods or services similar to or competitive with those offered by the Company.

 

This restriction shall only apply to the following:

 

(a)                                 Customers or prospective customers the Executive contacted in any way during the previous 24 months;

 

(b)                                 Customers about whom the Executive has trade secret or confidential information;

 

(c)                                  Customers who became customers during the Executive’s employment with the Company; and

 

(d)                                 Customers about whom the Executive has information that is not available publicly.

 

9.                            Non-Disparagement. The Executive agrees and covenants that he will not at any time make, publish or communicate to any person or entity or in any public forum any defamatory or disparaging remarks, comments, or statements concerning the Company or its businesses, or any of its employees, officers, and existing and prospective customers, suppliers, investors and other associated third parties.

 

This Section 9 does not, in any way, restrict or impede the Executive from exercising protected rights to the extent that such rights cannot be waived by agreement or from complying with any applicable law or regulation or a valid order of a court of competent jurisdiction or an authorized government agency, provided that such compliance does not exceed that required by the law, regulation, or order. The Executive shall promptly provide written notice of any such order to the Corporate General Counsel.

 

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The Company agrees and covenants that it shall cause its officers, directors and senior management to refrain from making any defamatory or disparaging remarks, comments, or statements concerning the Executive to any third parties.

 

Nothing in this section or any part of this Amended Agreement shall be construed as in any way inhibiting the obligation to provide truthful testimony under oath as part of any proceeding or matter.

 

10.                     Acknowledgement. The Executive acknowledges and agrees that the services to be rendered by him to the Company are of a special and unique character; that the Executive will obtain knowledge and skill relevant to the Company’s industry, methods of doing business and marketing strategies by virtue of the Executive’s employment; and that the restrictive covenants and other terms and conditions of this Amended Agreement are reasonable and reasonably necessary to protect the legitimate business interest of the Company.

 

The Executive further acknowledges that the amount of his compensation reflects, in part, his obligations and the Company’s rights under Section 7, Section 8, and Section 9 of this Amended Agreement; that he has no expectation of any additional compensation, royalties or other payment of any kind not otherwise referenced herein in connection herewith; and that he will not be subject to undue hardship by reason of his full compliance with the terms and conditions of Section 7, Section 8, and Section 9 of this Amended Agreement or the Company’s enforcement thereof.

 

11.                     Remedies. In the event of a breach or threatened breach by the Executive of Section 7, Section 8, or Section 9 of this Amended Agreement, the Executive hereby consents and agrees that the Company shall be entitled to seek, in addition to other available remedies, a temporary or permanent injunction or other equitable relief against such breach or threatened breach from any court of competent jurisdiction, without the necessity of showing any actual damages or that money damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned equitable relief shall be in addition to, not in lieu of, legal remedies, monetary damages, or other available forms of relief.

 

12.                     Proprietary Rights.

 

12.1                        Work Product. The Executive acknowledges and agrees that all right, title, and interest in and to all writings, works of authorship, technology, inventions, discoveries, processes, techniques, methods, ideas, concepts, research, proposals, materials, and all other work product of any nature whatsoever, that are created, prepared, produced, authored, edited, amended, conceived, or reduced to practice by the Executive individually or jointly with others during the period of his employment by the Company and relate in any way to the business or contemplated business, products, activities, research, or development of the Company or result from any work performed by the Executive for the Company (in each case, regardless of when or where prepared or whose equipment or other resources is used in preparing the same), all rights and claims related to the foregoing, and all printed, physical and electronic copies, and other tangible embodiments thereof (collectively, “Work Product”), as well as any and all rights in and to US and foreign (a) patents, patent disclosures and inventions (whether patentable or not), (b) trademarks, service marks, trade

 

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dress, trade names, logos, corporate names, and domain names, and other similar designations of source or origin, together with the goodwill symbolized by any of the foregoing, (c) copyrights and copyrightable works (including computer programs), and rights in data and databases, (d) trade secrets, know-how, and other confidential information, and (e) all other intellectual property rights, in each case whether registered or unregistered and including all registrations and applications for, and renewals and extensions of, such rights, all improvements thereto and all similar or equivalent rights or forms of protection in any part of the world (collectively, “Intellectual Property Rights”), shall be the sole and exclusive property of the Company.

 

For purposes of this Amended Agreement, Work Product includes, but is not limited to, Company information, including plans, publications, research, strategies, techniques, agreements, documents, contracts, terms of agreements, negotiations, know-how, computer programs, computer applications, software design, web design, work in process, databases, manuals, results, developments, reports, graphics, drawings, sketches, market studies, formulae, notes, communications, algorithms, product plans, product designs, styles,  models, audiovisual programs, inventions, unpublished patent applications, original works of authorship, discoveries, experimental processes, experimental results, specifications,  customer information, client information, customer lists, client lists, manufacturing information, marketing information, advertising information, and sales information.

 

12.2                        Work Made for Hire; Assignment. The Executive acknowledges that, by reason of being employed by the Company at the relevant times, to the extent permitted by law, all of the Work Product consisting of copyrightable subject matter is “work made for hire” as defined in 17 U.S.C. § 101 and such copyrights are therefore owned by the Company. To the extent that the foregoing does not apply, the Executive hereby irrevocably assigns to the Company, for no additional consideration, the Executive’s entire right, title, and interest in and to all Work Product and Intellectual Property Rights therein, including the right to sue, counterclaim, and recover for all past, present, and future infringement, misappropriation, or dilution thereof, and all rights corresponding thereto throughout the world. Nothing contained in this Amended Agreement shall be construed to reduce or limit the Company’s rights, title, or interest in any Work Product or Intellectual Property Rights so as to be less in any respect than that the Company would have had in the absence of this Amended Agreement.

 

12.3                        Further Assurances; Power of Attorney. During and after his employment, the Executive agrees to reasonably cooperate with the Company to (a) apply for, obtain, perfect, and transfer to the Company the Work Product as well as any and all Intellectual Property Rights in the Work Product in any jurisdiction in the world; and (b) maintain, protect and enforce the same, including, without limitation, giving testimony and executing and delivering to the Company any and all applications, oaths, declarations, affidavits, waivers, assignments, and other documents and instruments as shall be requested by the Company. The Executive hereby irrevocably grants the Company power of attorney to execute and deliver any such documents on the Executive’s behalf in his name and to do all other lawfully permitted acts to transfer the Work Product to the Company and further the transfer, prosecution, issuance, and maintenance of all Intellectual Property Rights therein, to the full extent permitted by law, if the Executive does not promptly cooperate with the

 

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Company’s request (without limiting the rights the Company shall have in such circumstances by operation of law). The power of attorney is coupled with an interest and shall not be affected by the Executive’s subsequent incapacity.

 

12.4                        No License. The Executive understands that this Amended Agreement does not, and shall not be construed to, grant the Executive any license or right of any nature with respect to any Work Product or Intellectual Property Rights or any Confidential Information, materials, software, or other tools made available to him by the Company.

 

13.                     Security.

 

13.1                        Security and Access. The Executive agrees and covenants (a) to comply with all Company security policies and procedures as in force from time to time, including without limitation those regarding computer equipment, telephone systems, voicemail systems, facilities access, monitoring, key cards, access codes, Company intranet, internet, social media and instant messaging systems, computer systems, e-mail systems, computer networks, document storage systems, software, data security, encryption, firewalls, passwords, and any and all other Company facilities, IT resources and communication technologies (“Facilities and Information Technology Resources”); (b) not to access or use any Facilities and Information Technology Resources except as authorized by the Company; and (iii) not to access or use any Facilities and Information Technology Resources in any manner after the termination of the Executive’s employment by the Company, whether termination is voluntary or involuntary. The Executive agrees to notify the Company promptly in the event he learns of any violation of the foregoing by others, or of any other misappropriation or unauthorized access, use, reproduction, or reverse engineering of, or tampering with any Facilities and Information Technology Resources or other Company property or materials by others.

 

13.2                        Return of Company Property. Upon (a) voluntary or involuntary termination of the Executive’s employment or (b) the Company’s request at any time during the Executive’s employment, the Executive shall (i) provide or return to the Company any and all Company property, including keys, key cards, access cards, identification cards, security devices, employer credit cards, network access devices, computers, cell phones, smartphones, PDAs, pagers, fax machines, equipment, speakers, webcams, manuals, reports, files, books, compilations, Work Product, e-mail messages, recordings, tapes, disks, thumb drives or other removable information storage devices, hard drives, negatives and data, and all Company documents and materials belonging to the Company and stored in any fashion, including but not limited to those that constitute or contain any Confidential Information or Work Product, that are in the possession or control of the Executive, whether they were provided to the Executive by the Company or any of its business associates or created by the Executive in connection with his employment by the Company; and (ii), upon instruction from the Company, delete or destroy all copies of any such documents and materials not returned to the Company that remain in the Executive’s possession or control, including those stored on any non-Company devices, networks, storage locations, and media in the Executive’s possession or control.

 

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14.                     Publicity. The Executive hereby irrevocably consents to any and all uses and displays, by the Company and its agents, representatives and licensees, of the Executive’s name, voice, likeness, image, appearance, and biographical information in, on or in connection with any pictures, photographs, audio and video recordings, digital images, websites, television programs and advertising, other advertising and publicity, sales and marketing brochures, books, magazines, other publications, CDs, DVDs, tapes, and all other printed and electronic forms and media throughout the world, at any time during or after the period of his employment by the Company, for all legitimate commercial and business purposes of the Company (“Permitted Uses”) without further consent from or royalty, payment, or other compensation to the Executive. The Executive hereby forever waives and releases the Company and its directors, officers, employees, and agents from any and all claims, actions, damages, losses, costs, expenses, and liability of any kind, arising under any legal or equitable theory whatsoever at any time during or after the period of his employment by the Company, arising directly or indirectly from the Company’s and its agents’, representatives’, and licensees’ exercise of their rights in connection with any Permitted Uses.

 

15.                     Governing Law: Jurisdiction and Venue. This Amended Agreement, for all purposes, shall be construed in accordance with the laws of Tennessee without regard to conflicts of law principles. Any action or proceeding by either of the parties to enforce this Amended Agreement shall be brought only in a state or federal court located in Hamilton County, Tennessee. The parties hereby irrevocably submit to the exclusive jurisdiction of such courts and waive the defense of inconvenient forum to the maintenance of any such action or proceeding in such venue.

 

16.                     Entire Amended Agreement. Unless specifically provided herein, this Amended Agreement contains all of the understandings and representations between the Executive and the Company pertaining to the subject matter hereof and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, with respect to such subject matter. The parties mutually agree that the Amended Agreement can be specifically enforced in court and can be cited as evidence in legal proceedings alleging breach of the Amended Agreement.

 

17.                     Modification and Waiver. No provision of this Amended Agreement may be amended or modified unless such amendment or modification is agreed to in writing and signed by the Executive and by either the Executive Chairman or the Chairman of the Board of the Company. No waiver by either of the parties of any breach by the other party hereto of any condition or provision of this Amended Agreement to be performed by the other party hereto shall be deemed a waiver of any similar or dissimilar provision or condition at the same or any prior or subsequent time, nor shall the failure of or delay by either of the parties in exercising any right, power, or privilege hereunder operate as a waiver thereof to preclude any other or further exercise thereof or the exercise of any other such right, power, or privilege.

 

18.                     Severability. Should any provision of this Amended Agreement be held by a court of competent jurisdiction to be enforceable only if modified, or if any portion of this Amended Agreement shall be held as unenforceable and thus stricken, such holding shall not affect the validity of the remainder of this Amended Agreement, the balance of which shall continue to be

 

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binding on the parties with any such modification to become a part hereof and treated as though originally set forth in this Amended Agreement.

 

The parties further agree that any such court is expressly authorized to modify any such unenforceable provision of this Amended Agreement in lieu of severing such unenforceable provision from this Amended Agreement in its entirety, whether by rewriting the offending provision, deleting any or all of the offending provision, adding additional language to this Amended Agreement, or by making such other modifications as it deems warranted to carry out the intent and agreement of the parties as embodied herein to the maximum extent permitted by law.

 

The parties expressly agree that this Amended Agreement as so modified by the court shall be binding on and enforceable against each of them.

 

19.                     Captions. Captions and headings of the sections and paragraphs of this Amended Agreement are intended solely for convenience and no provision of this Amended Agreement is to be construed by reference to the caption or heading of any section or paragraph.

 

20.                     Counterparts. This Amended Agreement may be executed in separate counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.

 

21.                     Tolling. Should the Executive violate any of the terms of the restrictive covenant obligations articulated herein, the obligation at issue will run from the first date on which the Executive ceases to be in violation of such obligation.

 

22.                     Section 409A.

 

22.1                        General Compliance. This Amended Agreement is intended to comply with Section 409A or an exemption thereunder and shall be construed and administered in accordance with Section 409A. Notwithstanding any other provision of this Amended Agreement, payments provided under this Amended Agreement may only be made upon an event and in a manner that complies with Section 409A or an applicable exemption. Any payments under this Amended Agreement that may be excluded from Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral shall be excluded from Section 409A to the maximum extent possible. For purposes of Section 409A, each installment payment provided under this Amended Agreement shall be treated as a separate payment. Any payments to be made under this Amended Agreement upon a termination of employment shall only be made upon a “separation from service” under Section 409A. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Amended Agreement comply with Section 409A, and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred by the Executive on account of non-compliance with Section 409A.

 

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22.2                        Specified Employees. Notwithstanding any other provision of this Amended Agreement, if any payment or benefit provided to the Executive in connection with his termination of employment is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A and the Executive is determined to be a “specified employee” as defined in Section 409A(a)(2)(b)(i), then such payment or benefit shall not be paid until the first payroll date to occur following the six-month anniversary of the Termination Date or, if earlier, on the Executive’s death (the “Specified Employee Payment Date”). The aggregate of any payments that would otherwise have been paid before the Specified Employee Payment Date shall be paid to the Executive in a lump sum on the Specified Employee Payment Date and thereafter, any remaining payments shall be paid without delay in accordance with their original schedule.

 

22.3                        Reimbursements. To the extent required by Section 409A, each reimbursement or in-kind benefit provided under this Amended Agreement shall be provided in accordance with the following:

 

(a)                                 the amount of expenses eligible for reimbursement, or in-kind benefits provided, during each calendar year cannot affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year;

 

(b)                                 any reimbursement of an eligible expense shall be paid to the Executive on or before the last day of the calendar year following the calendar year in which the expense was incurred; and

 

(c)                                  any right to reimbursements or in-kind benefits under this Amended Agreement shall not be subject to liquidation or exchange for another benefit.

 

23.                     Notification to Subsequent Employer. When the Executive’s employment with the Company terminates, the Executive agrees to notify any subsequent employer of the restrictive covenants sections contained in this Amended Agreement. The Executive will also deliver a copy of such notice to the Company before the Executive commences employment with any subsequent employer. In addition, the Executive authorizes the Company to provide a copy of the restrictive covenants sections of this Amended Agreement to third parties, including but not limited to, the Executive’s subsequent, anticipated, or possible future employer.

 

24.                     Successors and Assigns. This Amended Agreement is personal to the Executive and shall not be assigned by the Executive. Any purported assignment by the Executive shall be null and void from the initial date of the purported assignment. The Company may assign this Amended Agreement to any successor or assign (whether direct or indirect, by purchase, merger, consolidation, or otherwise) This Amended Agreement shall inure to the benefit of the Company and permitted successors and assigns.

 

25.                     Notice. Notices and all other communications provided for in this Amended Agreement shall be in writing and shall be delivered (i) by hand delivery; (ii) by registered or certified mail, return receipt requested; (iii)by overnight carrier; or (iv) by email with return receipt requested to the parties at the addresses set forth below (or such other addresses as specified by the parties by like notice):

 

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If to the Company:
    	
 
    
	
 
    	
 
    
	
U.S. Xpress Enterprises, Inc.
    	
 
    
	
4080 Jenkins Road
    	
 
    
	
Chattanooga, TN 37421
    	
 
    
	
ATTN: Corporate General Counsel
    	
 
    
	
Email: lbattersby@usxpress.com
    	
 
    
	
 
    	
 
    
	
If to the Parent Company:
    	
 
    
	
 
    	
 
    
	
New Mountain Lake Holdings, LLC
    	
 
    
	
4080 Jenkins Road
    	
 
    
	
Chattanooga, TN 37421
    	
 
    
	
ATTN: Max L. Fuller
    	
 
    
	
Email: mfuller@usxpress.com
    	
 
    
	
 
    	
 
    
	
If to the Executive:
    	
 
    
	
William E. Fuller
    	
 
    
	
3114 Enclave Bay Drive
    	
 
    
	
Chattanooga, TN 37415
    	
 
    
	
Email: efuller@usxpress.com
    	
 
    

 

26.                     Representations of the Executive. The Executive represents and warrants to the Company that:

 

The Executive’s acceptance of employment with the Company and the performance of his duties hereunder will not conflict with or result in a violation of, a breach of, or a default under any contract, agreement, or understanding to which he is a party or is otherwise bound.

 

The Executive’s acceptance of employment with the Company and the performance of his duties hereunder will not violate any non-solicitation, non-competition, or other similar covenant or agreement of a prior employer.

 

27.                     Withholding. The Company shall have the right to withhold from any amount payable hereunder any Federal, state, and local taxes in order for the Company to satisfy any withholding tax obligation it may have under any applicable law or regulation.

 

28.                     Survival. Upon the expiration or other termination of this Amended Agreement, the respective rights and obligations of the parties hereto shall survive such expiration or other termination to the extent necessary to carry out the intentions of the parties under this Amended Agreement.

 

29.                     Acknowledgement of Full Understanding. THE EXECUTIVE ACKNOWLEDGES AND AGREES THAT HE HAS FULLY READ, UNDERSTANDS AND VOLUNTARILY

 

24

 

ENTERS INTO THIS AMENDED AGREEMENT. THE EXECUTIVE ACKNOWLEDGES AND AGREES THAT HE HAS HAD AN OPPORTUNITY TO ASK QUESTIONS AND CONSULT WITH AN ATTORNEY OF HIS CHOICE BEFORE SIGNING THIS AMENDED AGREEMENT.

 

IN WITNESS WHEREOF, the parties hereto have executed this Amended Agreement to be effective as of the date first above written.

 

	
WILLIAM ERIC FULLER
    	
 
    
	
 
    	
 
    
	
/s/ William Eric Fuller
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
U.S. XPRESS ENTERPRISES, INC.
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Lisa M. Pate
    	
 
    
	
Print Name:
    	
Lisa M. Pate
    	
 
    
	
Title:
    	
Chief   Administrative Officer
    	
 
    
					

 

	
NEW MOUNTAIN LAKE   HOLDINGS, LLC
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Max L. Fuller
    	
 
    
	
 
    	
 
    	
 
    
	
Print Name:
    	
Max L. Fuller
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Manager,   CEO, Secretary
    	
 
    
					

 

25

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00283-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00283-of-00352.parquet"}]]