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EXHIBIT 10.16
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "AGREEMENT") is made and entered into as of
the 2nd day of January, 1998, by and between Specialty Transportation Services,
Inc., an Illinois corporation (the "EMPLOYER") and Gary I. Goldberg (the
"EXECUTIVE").
RECITALS
A. The Executive has assigned a substantial portion of his interests in
that certain Asset Purchase Agreement executed by and between the Executive and
Jack Gray Transport, Inc. ("JGT"), dated as of September 24, 1997, as amended
by amendment dated as of January 2, 1998 (the "ASSET PURCHASE AGREEMENT"), to
Aasche Transportation Services, Inc. ("AASCHE") (referred to hereinafter as the
"ASSIGNMENT") (which Asset Purchase Agreement is expected to be further
assigned to the Employer on or about January 30, 1998), and the Employer has
agreed to engage the Executive to provide services for the benefit of the
Employer and the Executive desires to accept such employment with the Employer.
B. The Employer and the Executive acknowledge that the Executive will be a
member of the senior management team of the Employer and, as such, will
participate in implementing the Employer's business plan.
C. In the course of his prior employment with JGT and in the course of his
employment with the Employer, the Executive has had and will continue to have
access to certain confidential information that relates to or will relate to
the business of the Employer.
D. The Employer desires that any such information not be disclosed to
other parties or otherwise used for unauthorized purposes.
NOW, THEREFORE, in consideration of the above premises and the following
mutual covenants and conditions, the parties agree as follows:
1. Employment. The Employer shall employ the Executive as the President
of the Employer. In addition to the foregoing, the Employer acknowledges that
the Executive has been elected as a Director of the Employer. The Executive
hereby accepts such employment and positions on the following terms and
conditions.
2. Duties. The Executive shall work for the Employer in a full-time
capacity. The Executive shall, during the term of this Agreement, have the
duties, responsibilities, powers, and authority customarily associated with the
position of President. The Executive shall report to, and follow the direction
of, the Board of Directors of the Employer (the "BOARD"). The Executive shall
diligently, competently, and faithfully perform all duties, and shall devote
substantially all his entire business time, energy, attention, and skill to the
performance of duties for the Employer and will use his best efforts to promote
the interests of the Employer. Upon the
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consent of a majority of the Board, it shall not be considered a violation of
the foregoing for the Executive to serve on corporate, industry, civic, or
charitable boards or committees, so long as such activities do not significantly
interfere with the performance of the Executive's responsibilities as an
employee of the Employer in accordance with this Agreement.
3. Executive Loyalty. The Executive shall devote substantially all of his
time, attention, knowledge, and skill solely and exclusively to the business
and interests of the Employer, and the Employer shall be entitled to all
benefits and profits arising from or incident to any and all work, services,
and advice of the Executive. The Executive expressly agrees that during the
term of this Agreement, he shall not engage, directly or indirectly, as a
partner, advisor, agent, employee, or in any other form or capacity, in any
other business similar to that of the Employer other than as Vice President,
director and stockholder of Aasche. The foregoing notwithstanding, nothing
herein contained shall be deemed to prevent the Executive from investing his
money in the capital stock or other securities of any corporation whose stock
or securities are publicly-owned or are regularly traded on any public
exchange, nor shall anything herein contained be deemed to prevent the
Executive from investing his money in real estate or other businesses unrelated
to the business of Employer.
4. Term of Employment. Unless sooner terminated as hereinafter provided,
this Agreement shall be entered into for a period of five (5) years, commencing
as of the date first set forth above (the "INITIAL TERM"). The term of
employment shall be renewed automatically for successive periods of one (1)
year each (a "RENEWAL TERM") after the expiration of the Initial Term and any
subsequent Renewal Term, unless the Board provides the Executive, or the
Executive provides the Board, with written notice to the contrary at least
thirty (30) days prior to the end of the Initial Term or any Renewal Term.
5. Compensation.
A. Salary. The Employer shall pay the Executive an annual salary of
$175,000 (the "INITIAL SALARY"), payable in substantially equal installments in
accordance with the Employer's payroll policy from time to time in effect. The
Executive's salary shall be subject to any payroll or other deductions as may be
required to be made pursuant to law, government order, or by agreement with, or
consent of, the Executive. Changes to the Initial Salary, as adjusted, may be
made following an annual salary review, the first of which shall take place in
or around January, 1999, and all subsequent reviews shall occur in or around
January of each year thereafter.
B. Bonus. For the 1998 and all subsequent fiscal years, the Executive
shall participate in an executive bonus plan to be established for the executive
employees of the Employer.
C. Stock Options. Effective on the date hereof, Aasche shall grant the
Executive a nonstatutory option to purchase five hundred thousand (500,000)
shares of the Common Stock of Aasche, par value $.0001 per share. The grant
of such stock option, and the terms and conditions thereof, are set forth in the
option agreement attached hereto as Exhibit A.
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D. Other Benefits. During the term of this Agreement, the Employer
shall:
(1) include the Executive in any life insurance, disability
insurance, medical, dental or health insurance, savings, pension
and retirement plans and other benefit plans or programs
(including, if applicable, any excess benefit or supplemental
executive retirement plans) maintained by the Employer for the
benefit of its executives;
(2) include the Executive in such perquisites as the Employer
may establish from time to time that are commensurate with his
position and at least comparable to those received by other
executives of the Employer, including the use of a Cadillac Seville
or an automobile of comparable value; and
(3) provide the Executive with four (4) weeks paid vacation
per annum.
6. Expenses. The Employer shall reimburse the Executive for all
reasonable and approved business expenses, provided the Executive submits paid
receipts or other documentation acceptable to the Employer and as required by
the Internal Revenue Service to qualify as ordinary and necessary business
expenses under the Internal Revenue Code of 1986, as amended.
7. Termination. Notwithstanding anything in Paragraph 4 of this
Agreement to the contrary, the Executive's services shall terminate upon the
first to occur of the following events:
A. At the end of the term of this Agreement, including any Renewal
Terms.
B. Upon the Executive's date of death or the date the Executive is
given written notice that he has been determined to be disabled by the Employer.
For purposes of this Agreement, "DISABILITY" shall mean a physical or mental
condition that impairs the Executive's ability to perform substantially his
required duties for a period of four (4) consecutive months or for any aggregate
period of six (6) months in any twelve (12) month period. A determination as
to whether or not the Executive has become disabled pursuant to this Paragraph
7B shall be made following examinations by the Executive's physician and a
physician chosen by the Employer. If the physicians as chosen by the Executive
and the Employer shall be unable to agree, the parties shall choose a third
physician whose assessment as to whether or not the Executive has suffered a
Disability shall be binding. A termination of the Executive's employment by the
Employer for Disability shall be communicated to the Executive by written notice
and shall be effective on the tenth (10th) business day after receipt of such
notice by the Executive, unless the Executive returns to full-time performance
of his duties before such tenth (10th) business day.
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C. On the date the Employer provides the Executive with written
notice that he is being terminated for "cause." For purposes of this Agreement,
the Executive shall be deemed terminated for cause if the Employer terminates
the Executive after the Executive:
(1) shall have committed any felony including, but not limited
to, a felony involving fraud, theft, misappropriation, dishonesty,
or embezzlement;
(2) shall have committed intentional acts that materially
impair the goodwill or business of the Employer or cause material
damage to its property, goodwill, or business; or
(3) shall have refused to, or willfully failed to, perform his
material duties associated with the position of President of the
Employer.
D. On the date the Executive terminates his employment for any
reason, provided that the Executive shall give the Employer thirty (30) days
written notice prior to such date of his intention to terminate this Agreement.
E. On the date the Employer terminates the Executive's employment
for any reason, other than a reason set forth in Paragraph 7C, provided that the
Employer shall give the Executive thirty (30) days written notice prior to such
date of its intention to terminate this Agreement.
8. Compensation Upon Termination.
A. If the Executive's services are terminated pursuant to Paragraph
7, the Executive shall be entitled to his salary through his final date of
active employment. The Executive also shall be entitled to any benefits
mandated under the Consolidated Omnibus Budget Reconciliation Act of 1985
(COBRA) or required under the terms of any death, insurance, or retirement plan,
program, or agreement provided by the Employer and to which the Executive is a
party or in which the Executive is a participant, including, but not limited to,
any short-term or long-term disability plan or program, if applicable. In
addition, other than upon termination of the Executive's services pursuant to
Paragraph 7C or 7D, the Executive shall be entitled to a prorated portion of
the annual bonus to which he would otherwise be entitled pursuant to Paragraph
5B. The pro-rata bonus shall be equal to the product of: (1) at the Employer's
discretion, either (i) the estimated bonus the Executive would have received
for the fiscal year had the Executive's services not been terminated, or (ii)
the actual bonus received by the Executive for the year immediately preceding
the year in which his services are terminated and (2) a fraction, the
numerator of which shall equal the number of months which the Executive worked
during the fiscal year in which his employment is terminated and the denominator
of which shall equal twelve. Such pro rata bonus shall be payable to the
Executive no later than thirty (30) days after his employment is terminated.
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B. In addition to the salary and benefits set forth in Paragraph
8A, if the Executive's services are terminated pursuant to Paragraph 7E, the
Executive shall be entitled to the continuation of his base salary for the
remainder of the Initial Term or any Renewal Term then in effect (the "SALARY
CONTINUATION PERIOD"), at the rate then in effect as provided under Paragraph
5A and payable in substantially equal installments in accordance with the
Employer's payroll policy from time to time in effect, provided he signs an
agreement that releases the Employer from actions, suits, claims, proceedings
and demands related to the period of employment and/or the termination of
employment.
9. Protective Covenants. The Executive acknowledges and agrees that
solely by virtue of his employment by, and relationship with, JGT and the
Employer, he has acquired and will acquire "Confidential Information", as
hereinafter defined, as well as special knowledge of JGT's and the Employer's
relationships with their customers, and that, but for his association with JGT
and the Employer, the Executive would not or will not have had access to said
Confidential Information or knowledge of said relationships. The Executive
further acknowledges and agrees (i) that JGT and the Employer have long term,
near-permanent relationships with their customers, and that those relationships
were developed at great expense and difficulty to JGT and the Employer, over
several years of close and continuing involvement; and (ii) that JGT's and the
Employer's relationships with their customers are and will continue to be
valuable, special and unique assets of the Employer and that the identity of
their customers is kept under tight security with the Employer and cannot be
readily ascertained from publicly available materials or from materials
available to the Employer's competitors. In return for the consideration
described in this Agreement, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and as a condition
precedent to the Employer entering into this Agreement and the Assignment, and
as an inducement to the Employer to do so, the Executive hereby represents,
warrants, and covenants as follows:
A. The Executive has executed and delivered this Agreement as his
free and voluntary act, after having determined that the provisions contained
herein are of a material benefit to him, and that the duties and obligations
imposed on him hereunder are fair and reasonable and will not prevent him from
earning a comparable livelihood following the termination of his employment
with the Employer;
B. The Executive has read and fully understands the terms and
conditions set forth herein, has had time to reflect on and consider the
benefits and consequences of entering into this Agreement, and has had the
opportunity to review the terms hereof with an attorney or other representative,
if he so chooses;
C. The execution and delivery of this Agreement by the Executive
does not conflict with, or result in a breach of or constitute a default under,
any agreement or contract, whether oral or written, to which the Executive is a
party or by which the Executive may be bound;
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D. The Executive agrees that, during the time of his employment and
for a period of one (1) year after the termination of the Executive's employment
hereunder for any reason whatsoever or for no reason, whether voluntary or
involuntary, or, if longer, during any Salary Continuation Period, the
Executive will not, except on behalf of Employer, anywhere in
North America where the Employer now conducts or operates, or may conduct or
operate, its business prior to the date of the Executive's termination of
employment:
(1) directly or indirectly, contact, solicit or direct any
person, firm, or corporation to contact or solicit, any of the
Employer's customers or prospective customers (as hereinafter
defined) for the purpose of selling or attempting to sell, services
that are the same as or similar to the services provided by the
Employer to its customers during the term hereof (the "BUSINESS").
In addition, the Executive will not disclose the identity of any
such customers or prospective customers, or any part thereof, to
any person, firm, corporation, association, or other entity for any
reason or purpose whatsoever; and
(2) directly or indirectly, whether as an investor (excluding
investments representing less than one percent (1%) of the common
stock of a public company), lender, owner, stockholder, officer,
director, consultant, employee, agent, salesperson or in any other
capacity, whether part-time or full-time, become associated with
any business involved in the Business; and
(3) solicit or accept if offered to him, with or without
solicitation, on his own behalf or on behalf of any other person,
the services of any person who is an employee of the Employer, nor
solicit any of the Employer's employees to terminate employment
with the Employer, nor agree to hire any employee of the Employer
into employment with himself or any company, individual or other
entity; and
(4) act as a consultant, advisor, officer, manager, agent,
director, partner, independent contractor, owner, or employee for
or on behalf of any of the Employer's customers or prospective
customers, with respect to or in any way with regard to any aspect
of the Business;
E. The Executive acknowledges and agrees that the scope described
above is necessary and reasonable in order to protect the Employer in the
conduct of its Business and that, if the Executive becomes employed by another
employer, he shall be required to disclose the existence of this Paragraph 9 to
such employer and the Executive hereby consents to and the Employer is hereby
given permission to disclose the existence of this Paragraph 9 to such employer;
F. For purposes of this Paragraph 9, "customer" shall be defined as
any person, firm, or entity, including any affiliates thereof, that purchased
any type of service from the Employer or JGT or is or was doing business with
the Employer, JGT or the Executive
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within the twelve (12) month period immediately preceding termination of the
Executive's employment. For purposes of this Paragraph 9, "prospective
customer" shall be defined as any person, firm, or entity contacted or
solicited by the Employer, JGT or the Executive (whether directly or indirectly)
or who contacted the Employer, JGT or the Executive (whether directly or
indirectly) within the twelve (12) month period immediately preceding
termination of the Executive's employment for the purpose of having such
persons, firms, or entities become a customer of the Employer or JGT.
G. The Executive agrees that both during his employment and
thereafter the Executive will not, for any reason whatsoever, use for himself
or disclose to any person not employed by the Employer any "Confidential
Information" of the Employer acquired by the Executive during his relationship
with the Employer or with JGT, both prior to and during the term of this
Agreement. The Executive further agrees to use Confidential Information solely
for the purpose of performing duties with the Employer and further agrees not to
use Confidential Information for his own private use or commercial purposes or
in any way detrimental to the Employer. The Executive agrees that "Confidential
Information" includes but is not limited to: (1) any financial, business,
planning, operations, services, potential services, products, potential
products, technical information and/or know-how, formulas, production,
purchasing, marketing, sales, personnel, customer, broker, supplier, or other
information of the Employer; (2) any papers, data, records, processes, methods,
techniques, systems, models, samples, devices, equipment, compilations,
invoices, customer lists, or documents of the Employer; (3) any confidential
information or trade secrets of any third party provided to the Employer in
confidence or subject to other use or disclosure restrictions or limitations;
and (4) any other information, written, oral, or electronic, whether existing
now or at some time in the future, whether pertaining to current or future
developments, and whether previously accessed during the Executive's tenure with
JGT or to be accessed during his future employment with the Employer, which
pertains to the Employer's affairs or interests or with whom or how the Employer
does business. The Employer acknowledges and agrees that Confidential
Information does not include (1) information properly in the public domain, or
(2) information in the Executive's possession prior to the date of his original
employment with JGT;
H. During and after the term of employment hereunder, the Executive
will not remove from the Employer's premises any documents, records, files,
notebooks, correspondence, computer printouts, computer programs, computer
software, price lists, microfilm, or other similar documents containing
Confidential Information, including copies thereof, whether prepared by him or
others, except as his duty shall require, and in such cases, will promptly
return such items to the Employer. Upon termination of his employment with the
Employer, all such items including summaries or copies thereof, then in the
Executive's possession, shall be returned to the Employer immediately;
I. The Executive recognizes and agrees that all ideas, inventions,
enhancements, plans, writings, and other developments or improvements (the
"INVENTIONS") conceived by the Executive, alone or with others, during the term
of his employment, whether or not during working hours, that are within the
scope of the Business or that relate to any of the
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Employer's work or projects, are the sole and exclusive property of the
Employer. The Executive further agrees that (1) he will promptly disclose all
Inventions to the Employer and hereby assigns to the Employer all present and
future rights he has or may have in those Inventions, including without
limitation those relating to patent, copyright, trademark or trade secrets; and
(2) all of the Inventions eligible under the copyright laws are "work made for
hire." At the request of and without charge to the Employer, the Executive will
do all things deemed by the Employer to be reasonably necessary to perfect title
to the Inventions in the Employer and to assist in obtaining for the Employer
such patents, copyrights or other protection as may be provided under law and
desired by the Employer, including but not limited to executing and signing any
and all relevant applications, assignments or other instruments.
Notwithstanding the foregoing, pursuant to the Employee Patent Act, Illinois
Public Act 83-493, the Employer hereby notifies the Executive that the
provisions of this Paragraph 9 shall not apply to any Inventions for which no
equipment, supplies, facility or trade secret information of the Employer was
used and which were developed entirely on the Executive's own time, unless (1)
the Invention relates (i) to the business of the Employer, or (ii) to actual or
demonstrably anticipated research or development of the Employer, or (2) the
Invention results from any work performed by the Executive for the Employer;
J. The Executive acknowledges and agrees that all customer lists,
supplier lists, and customer and supplier information, including, without
limitation, addresses and telephone numbers, are and shall remain the exclusive
property of the Employer, regardless of whether such information was developed,
purchased, acquired, or otherwise obtained by the Employer or the Executive.
The Executive agrees to furnish to the Employer on demand at any time during the
term of this Agreement, and upon termination of this Agreement, his complete
list of the correct names and places of business and telephone numbers of all of
its customers and suppliers served by him. The Executive also agrees to furnish
to the Employer on demand at any time during the term of this Agreement, and
upon the termination of this Agreement, any other records, notes, computer
printouts, computer programs, computer software, price lists, microfilm, or any
other documents related to the Employer's business, including originals and
copies thereof; and
K. It is agreed that any breach or anticipated or threatened breach
of any of the Executive's covenants contained in this Paragraph 9 will result in
irreparable harm and continuing damages to the Employer and its business and
that the Employer's remedy at law for any such breach or anticipated or
threatened breach will be inadequate and, accordingly, in addition to any and
all other remedies that may be available to the Employer at law or in equity in
such event, any court of competent jurisdiction may issue a decree of specific
performance or issue a temporary and permanent injunction, without the
necessity of the Employer posting bond or furnishing other security and without
proving special damages or irreparable injury, enjoining and restricting the
breach, or threatened breach, of any such covenant, including, but not limited
to, any injunction restraining the Executive from disclosing, in whole or part,
any Confidential Information. The Executive acknowledges the truthfulness of
all factual statements in this Agreement and agrees that he is estopped from
and will not make any factual statement in any proceeding that is contrary to
this Agreement or any part thereof. The Executive further agrees
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to pay all of the Employer's costs and expenses, including reasonable
attorneys' and accountants' fees, incurred in enforcing such covenants.
10. Notices. Any and all notices required in connection with this
Agreement shall be deemed adequately given only if in writing and (a) personally
delivered, or sent by first class, registered or certified mail, postage
prepaid, return receipt requested, or by recognized overnight courier, (b) sent
by facsimile, provided a hard copy is mailed on that date to the party for whom
such notices are intended, or (c) sent by other means at least as fast and
reliable as first class mail. A written notice shall be deemed to have been
given to the recipient party on the earlier of (a) the date it shall be
delivered to the address required by this Agreement; (b) the date delivery shall
have been refused at the address required by this Agreement; (c) with respect to
notices sent by mail or overnight courier, the date as of which the Postal
Service or overnight courier, as the case may be, shall have indicated such
notice to be undeliverable at the address required by this Agreement; or (d)
with respect to a facsimile, the date on which the facsimile is sent and receipt
of which is confirmed. Any and all notices referred to in this Agreement, or
which either party desires to give to the other, shall be addressed to his
residence in the case of the Executive, or to its principal office in the case
of the Employer.
11. Waiver of Breach. Upon the unanimous consent of the Board, a waiver
by the Employer of a material breach of any provision of this Agreement by the
Executive shall not operate or be construed as a waiver or estoppel of any
subsequent breach by the Executive. No waiver shall be valid unless in writing
and signed by an authorized officer of the Employer.
12. Assignment. The Executive acknowledges that the services to be
rendered by him are unique and personal. Accordingly, the Executive may not
assign any of his rights or delegate any of his duties or obligations under this
Agreement. The rights and obligations of the Employer under this Agreement
shall inure to the benefit of and shall be binding upon the successors and
assigns of the Employer.
13. Entire Agreement. This Agreement sets forth the entire and final
agreement and understanding of the parties and contains all of the agreements
made between the parties with respect to the subject matter hereof. This
Agreement supersedes any and all other agreements, either oral or in writing,
between the parties hereto, with respect to the subject matter hereof. No
change or modification of this Agreement shall be valid unless in writing,
signed by the Employer and the Executive and subject to the unanimous consent of
the Board. If any provision of this Agreement shall be found invalid or
unenforceable for any reason, in whole or in part, then such provision shall be
deemed modified, restricted, or reformulated to the extent and in the manner
necessary to render the same valid and enforceable, or shall be deemed excised
from this Agreement, as the case may require, and this Agreement shall be
construed and enforced to the maximum extent permitted by law, as if such
provision had been originally incorporated herein as so modified, restricted, or
reformulated or as if such provision had not been originally incorporated
herein, as the case may be. The parties further agree to seek a lawful
substitute for any provision found to be unlawful; provided, that, if the
parties are unable to agree upon a lawful substitute, the parties desire and
request that a court or other authority called upon to
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decide the enforceability of this Agreement modify those restrictions in this
Agreement that, once modified, will result in an agreement that is enforceable
to the maximum extent permitted by the law in existence at the time of the
requested enforcement.
14. Headings. The headings in this Agreement are inserted for
convenience only and are not to be considered a construction of the provisions
hereof.
15. Execution of Agreement. This Agreement may be executed in several
counterparts, each of which shall be considered an original, but which when
taken together, shall constitute one agreement.
16. Recitals. The recitals to this Agreement are incorporated herein as
an integral part hereof and shall be considered as substantive and not precatory
language.
17. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of Indiana, without reference to its
conflict of law provisions, and any court action commenced to enforce this
Agreement shall have as its sole and exclusive venue the County of Porter,
Indiana.
IN WITNESS WHEREOF, the parties have set their signatures on the date
first written above.
EMPLOYER:
SPECIALTY TRANSPORTATION
SERVICES, INC.,
an Illinois corporation
By:/s/ Leon M. Monachos /s/ Gary I. Goldberg
-------------------- ---------------------
Gary I. Goldberg
Its: V.P. Finance
-------------------
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EXHIBIT A
AASCHE TRANSPORTATION SERVICES, INC.
NONSTATUTORY STOCK OPTION AGREEMENT
THIS AGREEMENT is made effective this 2nd day of January, 1998
("EFFECTIVE DATE"), by and between Aasche Transportation Services, Inc., a
Delaware corporation (the "COMPANY"), and Gary I. Goldberg (the "OPTIONEE").
WHEREAS, in accordance with the terms of his employment agreement with
the Company and Specialty Transportation Services, Inc. ("STS") of even date
herewith, the Company desires to grant to the Optionee an option to purchase
shares of its common capital stock (the "SHARES").
NOW, THEREFORE, in consideration of the following mutual covenants and
for other good and valuable consideration, the parties agree as follows:
1. GRANT OF OPTION
The Company grants to the Optionee the right and option to purchase all
or any part of an aggregate of 500,000 Shares (the "OPTION") on the
terms and conditions and subject to all the limitations set forth
herein. The Optionee acknowledges that the definitive records
pertaining to the grant of this Option, and exercises of rights
hereunder, shall be retained by the Company. The Option granted herein
is intended to be a nonstatutory option.
2. PURCHASE PRICE
The purchase price of the Shares subject to the Option shall be $3.9375
per Share, the closing price per Share on the Effective Date as
reported in the Wall Street Journal.
3. EXERCISE OF OPTION
Subject to this Agreement, the Option shall be exercisable as follows:
EXERCISE PERIOD
Commencement Expiration
Number of Shares Date Date
---------------- ---- ----
250,000 January 2, 1998 January 1, 2008
250,000 January 2, 2003 January 1, 2008
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The foregoing notwithstanding, the Company may accelerate the Exercise
Period set forth above based upon STS' attainment of certain annual
performance goals, which performance goals shall be set forth in an
attachment to this Agreement. Furthermore, if the Optionee's employment
with STS is terminated pursuant to Paragraph 7B or 7E of the Employment
Agreement entered into by STS and the Optionee as of January 2, 1998
(the "EMPLOYMENT AGREEMENT"), all Shares not then exercisable pursuant
to the above exercise schedule shall immediately become exercisable and
shall be exercisable through January 1, 2008.
The Option shall expire on, and shall be exercised (if at all) prior to
the first to occur of:
(a) Ten (10) years from the Effective Date;
(b) Sixty (60) days after the date on which the Optionee shall
cease, for any reason or cause whatsoever, and without regard to
such reason or cause (except as set forth in (c) below and other
than termination of the Optionee's employment pursuant to
Paragraph 7B or 7E of the Employment Agreement), to be an
employee of STS; or
(c) The date the Optionee's employment is terminated, if it is
terminated for "cause" as that term is defined in the Optionee's
Employment Agreement.
Upon expiration of the Option without it having been duly exercised,
the Option shall be and become null, void, and of no further effect.
4. EXERCISE OF OPTION AND ISSUANCE OF SHARES
The Option may be exercised in whole or in part (to the extent that it
is exercisable in accordance with its terms) by giving written notice
(or any other approved form of notice) to the Company. Such written
notice shall be signed by the person exercising the Option, shall state
the number of Shares with respect to which the Option is being
exercised and shall specify a date (other than a Saturday, Sunday or
legal holiday) not less than five (5) nor more than ten (10) days after
the date of such written notice, as the date on which the Shares will
be purchased, at the principal office of the Company during ordinary
business hours, or at such other hour and place agreed upon by the
Company and the person or persons exercising the Option, and shall
otherwise comply with the terms and conditions of this Agreement. On
the date specified in such written notice (which date may be extended
by the Company if any law or regulation requires the Company to take
any action with respect to the Shares prior to the issuance thereof),
the Company shall accept payment for the Shares and shall deliver to
the Optionee an appropriate certificate or certificates for the Shares
as to which the Option was exercised.
The Option price of any Shares shall be payable at the time of exercise
either in cash, by certified check or bank check, or by wire transfer.
The Company shall pay all original issue taxes with respect to the
issuance of Shares pursuant hereto and all other fees and expenses
necessarily incurred by the Company in connection therewith. The holder
of this Option shall have the rights of a stockholder only with respect
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to those Shares covered by the Option which have been registered in the
holder's name in the share register of the Company upon the due
exercise of the Option.
5. REPRESENTATIONS AND COVENANTS OF THE OPTIONEE
(a) In connection with the grant of the Option hereunder, the
Optionee represents and warrants to the Company that:
(i) The Shares subject to the Option under this Agreement
shall be acquired for the Optionee's own account and not
with a view to, or present intention of, distribution in
violation of the Securities Act of 1933 (the "1933 ACT")
or any applicable state securities laws, and the Shares
will not be disposed of in contravention of the 1933 Act
or any applicable state securities laws.
(ii) The Optionee is sophisticated in financial matters and is
able to evaluate the risks and benefits of the Option and
the Shares.
(iii) The Optionee acknowledges that he is able to bear the
economic risk of the exercise of the Option for an
indefinite period of time, because the Shares have not
been registered under the 1933 Act and, therefore, cannot
be resold unless subsequently registered under the 1933
Act or an exemption from such registration is available.
(iv) The Optionee has had an opportunity to ask questions and
receive answers concerning the terms and conditions of
the grant of the Option and has had full access to such
information concerning the Company as he has requested.
6. WITHHOLDING
The Company shall have the power and right to deduct or withhold, or
require the Optionee to remit to the Company, an amount sufficient to
satisfy federal, state, and local taxes required by law to be withheld
with respect to any grant made under or as a result of this Agreement.
In the alternative, upon any taxable event hereunder, the Optionee may
elect, subject to Company approval, to satisfy the withholding
requirement in whole or in part, by having the Company withhold Shares
that would otherwise be transferred to the Optionee having a fair
market value, on the date the tax is to be determined, equal to the
minimum marginal tax that could be imposed on the transaction. All
elections shall be made in writing and signed by the Optionee.
7. LEGEND
The Optionee shall be bound by the provisions of the following legend
(or similar legend) which shall be endorsed upon the certificate(s)
evidencing the Shares issued pursuant to the grant of the Option
hereunder.
"The shares represented by this certificate have been acquired for
investment and they may not be sold or otherwise transferred by
any person in the absence
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of an effective registration statement for the shares under the
Securities Act of 1933 or an opinion of counsel satisfactory to
the Company that an exemption from registration is then
available."
8. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION
In the event that the outstanding Shares of the Company are changed
into or exchanged for a different number or kind of shares or other
securities of the Company or of another corporation by reason of any
reorganization, merger, consolidation, recapitalization,
reclassification, change in par value, stock split-up, combination of
shares or dividends payable in capital stock, or the like, appropriate
adjustments to prevent dilution or enlargement of the Shares granted
to, or available for, the Optionee shall be made in the manner and kind
of Shares granted hereunder.
9. NON-ASSIGNABILITY
This Option shall not be transferable by the Optionee and shall be
exercisable only by the Optionee, except as this Agreement may
otherwise provide.
10. NOTICES
Any notices required or permitted by the terms of this Agreement shall
be given by registered or certified mail, return receipt requested,
addressed as follows:
To the Company: Aasche Transportation Services, Inc.
10214 N. Mt. Vernon Road
Shannon, Illinois 61078
Attn: Board of Directors
To the Optionee: Gary I. Goldberg
7418 Oak Avenue
Gary, Indiana 46403
or to such other address or addresses of which notice in the same manner
has previously been given. Any such notice shall be deemed to have been
given when mailed in accordance with the foregoing provisions.
11. GOVERNING LAW
This Agreement shall be construed and enforced in accordance with the
laws of the State of Illinois.
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12. BINDING EFFECT
This Agreement shall (subject to the provisions of Section 9 hereof) be
binding upon the heirs, executors, administrators, successors and
assigns of the parties hereto.
IN WITNESS WHEREOF, the Company and the Optionee have caused this
Agreement to be executed on their behalf, by their duly authorized
representatives, all on the day and year first above written.
AASCHE TRANSPORTATION SERVICES, INC.
By: /s/ Leon M. Monachos
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Leon M. Monachos, Chief Financial Officer
/s/ Gary I. Goldberg
-----------------------------------------------
Gary I. Goldberg
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