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EXHIBIT 10(c)
March 10, 1993
Mr. Palmer E. Huffstetler
President
Carolina Freight Corporation
N.C. Highway #150 East
Cherryville, North Carolina 28021
Dear Palmer:
The purpose of this letter is to confirm that the Compensation
Committee, acting under authority of the Board of Directors of the Company
("Board"), has authorized me to extend an employment contract ("Agreement") to
you as President of Carolina Freight Corporation (the "Company") and Carolina
Freight Carriers Corporation in accordance with the terms and conditions herein
outlined.
First, the term of the Agreement shall be for a period of three years,
which shall commence on March 22, 1993 and shall continue in effect until March
21, 1996; provided, however, that on March 21, 1994 the Agreement shall be
automatically extended for one additional year (to March 21, 1997) unless at
least ninety (90) days prior to such March 21, 1994 the Company shall have
given written notice to you that this Agreement shall not be so extended; and,
in the event the Agreement has been extended to March 21, 1997 the term shall
be further automatically extended for another year on March 21, 1995 (to March
21, 1998) unless the Company shall have given written notice to you at least
ninety (90) days prior to March 21, 1995 that this Agreement shall not be so
extended.
Second, your base salary shall not be less than $182,000 during the
first year of this Agreement and shall be adjusted upward annually to such
amount as the Compensation Committee shall, in its discretion, determine but in
no event less than an amount equal to the average percent of increase allowed
to that group of employees who comprise the officer group of Carolina
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Mr. Palmer E. Huffstetler
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March 10, 1993
Freight Corporation. In the event of a general pay reduction which applies to
all officers of the Company, your base salary shall be reduced by an amount
which shall be equal to the average percentage of reduction among all other
officers of the Company.
Third, bonuses shall be paid to you in such amounts as shall be
determined by the Compensation Committee but shall be paid in at least an
amount that is 125% of the highest bonus paid to any officer of Carolina
Freight Corporation other than the Chief Executive Officer pursuant to the
terms of the Carolina Freight Carriers Corporation and Red Arrow Incentive
Bonus Plan approved by the Carolina Freight Corporation Board of Directors on
January 6, 1993 or any successor plan applicable to the officers of the
Company.
Fourth, as has been the Company's practice, we shall continue to
provide you with membership in Cleveland Country Club which includes payment by
the Company of fees, dues, and assessments.
Fifth, a company car will be provided to you in accordance with the
Company's practice of providing automobiles for use by its officers.
Sixth, employee benefits which have previously been provided to you
will continue to be offered including, but not limited to, vacation, holiday,
and sick leave; group health and life insurance coverage; Senior Executive
Benefit Plan; Employee Savings and Protection Plan; Deferred Compensation Plan;
Severance Pay Agreement; Indemnity Agreement; Pension Plan; and stock options
which have been previously issued. Benefits provided under any of the
foregoing plans, as well as new plans which may be instituted by the Company,
are subject to change. Any such changes may impact your individual benefit but
shall be commensurate with the benefits provided to other officers of the
Company.
Seventh, during a period of ninety (90) days preceding the expiration
of the final year of this Agreement you shall be entitled to elect retirement
from the Company and receive the equivalent benefits as those offered to you by
Carolina Freight
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Mr. Palmer E. Huffstetler
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March 10, 1993
Carriers Corporation as an eligible participant under its 1992 Retirement
Incentive Program and such benefits shall be adjusted to reflect your rate of
compensation, then-current years of service, and benefit levels during the
term of this Agreement. For purposes of computing benefits, your retirement
date shall be deemed to be the last date that you perform service under the
terms of this Agreement.
Eighth, termination by the Company of your employment for Cause, as
defined herein, shall also terminate the Company's obligation to perform
further on any provision of this Agreement, except as to those benefits
referred to in paragraph Sixth which shall be provided to you in accordance
with specific terms of plan documents and agreements governing such benefits.
"Cause" shall mean (1) the willful and continued failure by you to perform
substantially your duties with the Company (other than any such failure
resulting from your incapacity due to physical or mental illness) after a
demand for substantial performance is delivered to you by the Chairman of the
Board which specifically identifies the manner in which you have not
substantially performed your duties, or (2) the willful engaging by you in
illegal conduct which is materially and demonstrably injurious to the Company.
For purposes of this paragraph, no act or failure to act, on your part shall be
considered "willful" unless done, or omitted to be done, by you in bad faith
and without reasonable belief that your action or omission was in, or not
opposed to, the best interests of the Company. You shall not be deemed to have
been terminated for Cause unless and until there shall have been delivered to
you a copy of a resolution duly adopted by the affirmative vote of not less
than three-quarters of the entire membership of the Board at a regular meeting
or a meeting called and held for the purpose, finding that in the good faith
opinion of the Board you were guilty of the conduct set forth above in (1) or
(2) of this paragraph and specifying the particulars thereof in detail.
Ninth, termination by you of your employment for "Good Reason" during
the term of this Agreement shall require the Company to continue to fulfill all
obligations herein set forth during the term as fully as if you were continued
in full employment under the Agreement. The term "Good Reason" shall mean (1)
a substantial change in your status or a significant alteration of your job
responsibilities (except in connection with the termination of your employment
for Cause, disability or retirement or as a result of your death or by you
other than for Good Reason), (2) a reduction by the Company in your base
salary,
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Mr. Palmer E. Huffstetler
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March 10, 1993
(3) the failure by the Company to continue in effect any plan in which you are
now participating (or plans providing you with at least substantially similar
benefits) other than as a result of the normal expiration of any such plan in
accordance with its terms, or the taking of any action, or the failure to act,
by the Company which would adversely affect the continued participation in any
of such plans on at least as favorable a basis to you or which would materially
reduce your benefits in the future under any of such plans or deprive you of
any material benefit enjoyed by you, (4) the failure by the Company to provide
and credit you with the number of paid vacation days to which you are then
entitled in accordance with the Company's normal vacation policy, (5) the
Company's requiring you to be based anywhere other than within a radius of
fifty (50) miles of the city where your office is presently located except for
required travel on Company business consistent with reasonable business travel
obligations that might ordinarily be expected by one occupying your position,
or (6) any purported termination by the Company of your employment which is
not effected pursuant to the requirements of the eighth paragraph of this
Agreement.
Please indicate your acquiescence and assent to this Agreement by
initialing each of the previous pages at the space provided and by
countersigning the last page of this letter.
Yours sincerely,
K. G. Younger
Chairman of the Board
Agreed to this _______
day of February, 1993.
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Palmer E. Huffstetler
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