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EXHIBIT 10.3
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made and entered into this 8th day of
December, 1997, and effective as of the "Effective Date" as defined below, by
and between BOYD BROS. TRANSPORTATION, INC., a Delaware corporation ("Boyd"),
and STEVEN RUMSEY, an individual resident of Alabama ("Employee");
W I T N E S S E T H:
WHEREAS, Employee was a shareholder and a manager of Welborn
Transport, Inc. ("Welborn"), an Alabama corporation that on this day has been
acquired by Boyd by means of a merger of Welborn with and into W.T. Acquisition
Corp., a wholly-owned subsidiary of Boyd;
WHEREAS, Boyd desires to employ Employee in a managerial
capacity for the period of time set forth herein;
WHEREAS, Employee desires to enter into this Agreement with
respect to Employee's employment upon the terms and conditions hereinafter set
forth; and
WHEREAS, Employee, because of his managerial duties described
herein, will directly and indirectly have access to manufacturing, marketing,
pricing and other confidential information of Boyd, which, if exploited by the
Employee in contravention of this Agreement, would seriously, adversely and
irreparably affect the business of Boyd;
NOW, THEREFORE, in consideration of the mutual covenants and
obligations contained herein, Boyd and Employee agree as follows:
1. Term of Employment. Boyd hereby employs Employee and
Employee hereby accepts such employment upon the terms and conditions set forth
in this Agreement. The term ("Term") of Employee's employment under this
Agreement shall be for a period commencing from the date hereof (the "Effective
Date") and terminating on the first anniversary of the Effective Date (the
"Termination Date"), unless such employment is terminated or extended prior to
the expiration of said period as hereinafter provided. Employee shall have the
right to extend the Term for up to two (2) additional one year periods by
providing notice to Boyd, in the case of the first such extension, within thirty
(30) days prior to the Termination Date and, in the case of the second such
extension, within thirty (30) days prior to the anniversary of the Termination
Date.
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2. Duties of Employee. Employee agrees, during the term of
this Agreement, to devote his full professional and business-related time,
skills and best efforts, in accordance with Boyd policies and procedures, to the
performance of all reasonable duties as may be assigned to Employee from time to
time by Boyd, which duties shall include acting as President of Welborn.
Employee shall devote all of his full professional and business-related skills
solely to the affairs of Boyd and shall not, during the term of this Agreement,
unless otherwise agreed to in advance in writing by Boyd, engage in other
employment or become self-employed in any other capacity during the term of this
Agreement. Employee may engage in personal investment activities provided such
activities do not interfere with Employee's performance of his full-time
employment duties under this Agreement. Employer acknowledges that Employee owns
an interest in (i) TWR, Inc., a garbage collection company, (ii) in Moorland
Properties, LLC, a rental properties company and (iii) S&L Outdoor Advertising,
Inc., an outdoor advertising company.
3. Compensation for Employment.
(a) Base Salary. In consideration of the employment
services to be rendered by Employee under this Agreement, Boyd shall pay or
cause to be paid to Employee an initial base salary of $2,884.61 per week
($150,000.00 per year), payable at the times and in the installments consistent
with Boyd payroll practices in effect from time to time, but in no event, less
than on a monthly basis. The initial base salary may be increased by Boyd based
upon growth of Boyd's business and other performance based objectives comparable
to those used to review compensation of other management employees of Boyd.
(b) Bonus. In addition to the base salary payable to
Employee, Employee shall be eligible to receive an annual incentive bonus
comparable to those bonus programs authorized from time to time by Boyd for
management employees of Boyd and its subsidiaries.
(c) Expenses. Boyd shall reimburse Employee, in
accordance with Boyd standard policies and procedures, for reasonable travel and
business related expenses incurred in the performance of his duties.
4. Fringe Benefits. Employee shall be entitled to participate
in such fringe benefit programs as may be authorized and adopted from time to
time by Boyd for employees who are similarly situated, which programs shall be
comparable to such programs authorized from time to time by Boyd and shall
include a car allowance of Seven Thousand Dollars ($7,000.00) per year;
provided, however, that Employee must meet any and all eligibility provisions
required under said programs. Boyd reserves the right to alter, modify or revoke
such benefits at any time with or without notice.
5. Disability. Employee shall be entitled during the term of
his employment to disability pay, if any, for an amount of time as is consistent
with the policies established by Boyd for an employee of Employee's position.
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6. Death During Employment. If Employee dies while employed
hereunder, Boyd shall pay to the estate of Employee the compensation which would
otherwise be payable to Employee under Sections 3(a) and 3(c) hereof, up to the
end of the month in which Employee's death occurs, and Boyd shall have no
further obligation under Section 3 hereof whatsoever.
7. Termination of Employment.
(a) Employee and Boyd shall have the right to
terminate the employment relationship described herein at any time by mutual
agreement in writing. In the event that Employee should be elected to Boyd's
Board of Directors, termination of Employee's employment with Boyd for any
reason shall automatically constitute Employee's immediate resignation from its
Board of Directors.
(b) Boyd shall have the right to terminate the
employment relationship hereunder, and shall be under no further obligation
hereunder (except as specifically provided in this Section 7(b)), for "Cause,"
as such term is defined below, by serving notice on Employee. In the event
Employee is terminated for Cause, Employee shall be entitled to compensation and
benefits, if any, only through the date of the notice of termination as
described in this Section 7(b).
(c) Boyd shall have the right to terminate the
employment relationship hereunder and this Agreement without Cause by serving
notice on Employee. In such event, Boyd shall be obligated to continue to pay
Employee until the Termination Date those payments described in Section 3(a),
and Boyd shall otherwise have no further obligation under this Agreement. In
addition, ninety (90) days after the date of termination of Employee's
employment with Boyd under this Section 7(c), Employee shall have the right to
sell the shares of Boyd Common Stock owned by him without regard to the
restrictions set forth in Section 4.5.2 of that certain Acquisition Agreement
dated as of December 1, 1997 between Boyd, W.T. Acquisition Corp., Welborn
Transport, Inc. and the Shareholders (as defined herein). Any sale of such
shares will, however, remain subject to any limitations imposed by the Federal
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
(d) For purposes of this Agreement, the term "Cause"
shall mean (i) conviction of a felony, misappropriation of any material funds or
property of Boyd, commission of fraud or embezzlement with respect to Boyd, or
any act or acts of dishonesty relating to Employee's employment by Boyd
resulting or intended to result in direct or indirect personal gain or
enrichment at the expense of Boyd; (ii) committing any breach of this Agreement
or the Covenant Not to Compete dated the date hereof among Employee, Boyd and
W.T. Acquisition Corp. (which breach is not cured by Employee within ten (10)
days' notice of violation from Boyd); (iii) failing to perform his obligations
under this Agreement due to alcoholism that makes Employee unable to perform the
essential functions of his job and with respect to which Boyd is unable to
provide accommodations without undue hardship; (iv) illicit drug use or any drug
(other than alcohol) addiction; (v) committing any material act or omission of a
material act involving willful
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malfeasance or gross negligence in the performance of Employee's duties under
this Agreement; (vi) deviating from the written policies or directives of Boyd,
provided the same policies and directives are applied consistently to all
management of Boyd, if Employee fails to cure such deviation within ten (10)
days after written notice to Employee; (vii) material failure by the Employee to
perform his duties hereunder or other reasonable directions from the Board of
Directors of Boyd, if Employee fails to cure such failure within ten (10) days
after written notice to Employee; or (viii) Boyd's reasonable dissatisfaction
with the quality of Employee's performance which continues after Boyd has
notified the Employee of such dissatisfaction setting forth obtainable
objectives to correct such dissatisfaction and has given the Employee a
reasonable time to obtain such objectives.
8. Noncompetition. Employee covenants and agrees that during
the Restricted Period, Employee will not, within the territories listed on
Exhibit A attached hereto, directly or indirectly, compete with Boyd by carrying
on a business which is substantially similar to the Business (as defined in
Section 11). "Restricted Period," for purposes of this Section 8, shall mean
that period commencing with the date of this Agreement and ending on the earlier
of (i) five years from the date of this Agreement and (ii) two years from the
date of termination of Employee's employment with Boyd.
9. Definition of "Compete." For the purposes of this
Agreement, the term "compete" shall mean with respect to the Business: (i)
managing, supervising, or otherwise participating in a management or supervisory
capacity in flatbed truckload carrier for hire operations (ii) calling on,
soliciting, taking away, accepting as a customer or attempting to call on,
solicit, take away or accept as a customer any individual, partnership,
corporation, limited liability company or association that is or was a customer
of Boyd during the twelve calendar month period immediately preceding such act
with whom the Employee had contact, either directly or indirectly in Employee's
managerial capacity, (iii) soliciting, taking away or attempting to solicit or
take away any employee of the Business, either on the Employee's behalf or on
behalf of any other person or entity, who was an employee of the Business during
the twelve calendar month period immediately preceding such act, or (iv)
entering into or attempting to enter into any business substantially similar to
the Business, either alone or with any individual, partnership, corporation,
limited liability company or association.
10. Direct or Indirect Competition. For the purposes of this
Agreement, the words "directly or indirectly" as used herein shall mean (i)
acting as an agent, representative, consultant, officer, director, member,
independent contractor, or employee of any entity or enterprise which is
competing with the Business, (ii) participating in any such competing entity or
enterprise as an owner, partner, limited partner, joint venturer, member,
creditor or stockholder (except as a stockholder holding less than one percent
(1%) interest in a corporation whose shares are actively traded on a regional or
national securities exchange or in the over-the-counter market), and (iii)
communicating to any such competing entity or enterprise the names or addresses
or any other information concerning any past, present, or identified prospective
customer of Boyd.
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11. Business. For purposes of this Agreement, the term
"Business" shall mean the operations of Welborn conducted immediately prior to
the date hereof relating to flatbed truckload carrier for hire operations.
12. Confidential Data. Employee further agrees that, for a
period of five (5) years following the Effective Date, Employee will keep
confidential and not directly or indirectly divulge to anyone nor use or
otherwise appropriate for Employee's own benefit, any pricing information,
marketing information, sales technique of Boyd any other of the following
confidential information or documents of or relating to Boyd: confidential
records, client and customer lists, information about client requirements, terms
of contracts with clients and customers, and planning and financial information
of Boyd (hereinafter referred to as the "Confidential Data"). Employee hereby
acknowledges and agrees that the prohibitions against disclosure of Confidential
Data recited herein are in addition to, and not in lieu of, any rights or
remedies which Boyd may have available pursuant to the laws of any jurisdiction
or at common law to prevent the disclosure of trade secrets or proprietary
information, and the enforcement by Boyd of its rights and remedies pursuant to
this Agreement shall not be construed as a waiver of any other rights or
available remedies which it may possess in law or equity absent this Agreement.
Notwithstanding the foregoing, the term "Confidential Data"
does not include any information which (i) at the time of disclosure or
thereafter is generally available to and known by the public (other than as a
result of a disclosure directly or indirectly by you or your representatives in
breach of this Agreement), (ii) was available to you on a nonconfidential basis
from a source other than Boyd or its directors, officers, employees, agents or
advisors, or (iii) has been independently acquired or developed by you without
violating any of your obligations under this agreement.
In the event that you or any of your representatives become
legally compelled (by deposition, interrogatory, request for documents,
subpoena, civil investigative demand, any similar process or otherwise) to
disclose any of the Confidential Data, you shall provide Boyd with prompt prior
written notice of such requirement so that Boyd may seek a protective order or
other appropriate remedy and/or waive compliance with the terms of this
agreement. In the event that such protective order or other remedy is not
obtained, or that Boyd waives compliance with the provisions hereof, you agree
to furnish only that portion of the Confidential Data which is required to be
disclosed in the written opinion of your counsel, and to use reasonable efforts
to obtain confidential treatment of such of the disclosed information which Boyd
so designates.
13. Non-Solicitation of Employees of Boyd. Employee covenants
that during the periods for which Employee is entitled to compensation or other
payment hereunder and until the earlier of (i) the expiration of the two year
period immediately following the last of such periods and (ii) five years from
the date of execution of this Agreement, Employee will neither directly nor
indirectly induce or attempt to induce any employee of Boyd to terminate his or
her employment to go to work for any other employer.
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14. Property of Boyd. Employee acknowledges that from time to
time in the course of providing services pursuant to this Agreement, Employee
will have the opportunity to inspect and use certain property, both tangible and
intangible, of Boyd, and Employee hereby agrees that said property shall remain
the exclusive property of Boyd and that Employee shall have no right or
proprietary interest in such property, whether tangible or intangible,
including, without limitation, Boyd's customer and supplier lists, contract
forms, books of account, computer programs and similar property.
15. Equitable Relief. Employee acknowledges that the services
to be rendered by Employee are of a special, unique, unusual, extraordinary and
intellectual character, which gives them a peculiar value, the loss of which
cannot reasonably or adequately be compensated in damages in an action at law
and that a breach by Employee of any of the provisions contained in this
Agreement will cause Boyd irreparable injury and damage. Employee further
acknowledges that Employee possesses unique skills, knowledge and ability and
that any material breach of the provisions of this Agreement would be extremely
detrimental to Boyd. By reason thereof, Employee agrees that Boyd shall be
entitled, in addition to any of the remedies it may have under this Agreement or
otherwise, to injunctive and other equitable relief to prevent or curtail any
breach of this Agreement by Employee; provided, however, that no specification
in this Agreement of a specific legal or equitable remedy shall be construed as
a waiver or prohibition against the pursuing of other legal or equitable
remedies in the event of a breach.
16. Successors Bound; Assignability. This Agreement shall be
binding upon Employee, Boyd and their successors in interest, including without
limitation, any corporation into which Boyd may be merged or by which it or all
or any substantial portion of its assets or business may be acquired. This
Agreement is nonassignable except that the rights, duties and obligations of
Boyd under this Agreement may be assigned to any affiliate of it and to any
acquiror of the business conducted by Boyd, in the event Boyd is merged,
liquidated, acquired or sells substantially all of the assets used in such
business.
17. Severability. In the event that any one or more of the
provisions of this Agreement or any word, phrase, clause, sentence, or other
portion thereof shall be deemed to be illegal or unenforceable for any reason,
such provision or portion thereof shall be modified or deleted in such manner so
as to make this Agreement as modified legal and enforceable to the fullest
extent permitted under applicable laws.
18. Entire Agreement. Except for the Covenant Not to Compete
dated the date hereof between Boyd, Employee and [Boyd Sub] (the "Covenant Not
to Compete"), this Agreement constitutes the entire agreement between the
parties hereto with regard to the subject matter hereof and supersedes all other
agreements relating to the subject matter hereof, including any previous
employment agreement. There are no agreements, understandings, specific
restrictions, warranties or representations relating to said subject matter
between the parties other than those set forth herein
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or herein provided. The parties agree that the covenants set forth in this
Agreement are in addition to, and not in limitation of, the covenants set forth
in the Covenant Not to Compete.
19. Counterparts. This Agreement may be executed in two or
more counterparts, each of which will take effect as an original, and all of
which shall evidence one and the same Agreement.
20. Amendment and Modification. This Agreement may only be
amended, modified or terminated prior to the end of its term by the mutual
written agreement of the parties.
21. Governing Law. The terms of this Agreement shall be
governed by and construed in accordance with the laws of the State of Alabama.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
BOYD BROS. TRANSPORTATION INC.
"Boyd"
By:
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Name:
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Title:
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STEVE RUMSEY
"Employee"
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Printed Name:
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EXHIBIT A
LIST STATES IN WHICH BOYD
IS PRESENTLY CONDUCTING BUSINESS
Louisiana Michigan
Mississippi Virginia
Alabama West Virginia
Georgia Pennsylvania
Florida New York
South Carolina Maryland
North Carolina District of Columbia
Tennessee Vermont
Kentucky New Hampshire
Illinois Maine
Indiana Massachusetts
Ohio Connecticut
Wisconsin Rhode Island
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