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EXHIBIT 4
ALLIED HOLDINGS, INC.
DEFERRED COMPENSATION PLAN
ALLIED HOLDINGS, INC., (the "Employer") hereby adopts this Deferred Compensation
Plan (the "Plan") effective January 1, 2001. The Plan is an unfunded deferred
compensation arrangement for a select group of management or highly compensated
Employees. Benefits under the Plan are payable from the Employer's general
assets and are subject to the claims of the Employer's creditors.
ARTICLE I
DEFINITIONS
"ACCOUNT" means the account, including any sub-accounts, established on behalf
of each Participant in the Plan.
"ACTIVE PARTICIPANT" means, in accordance with Section 2.1, (a) an Employee who:
(1) has satisfied the Plan's participation requirements for the Plan Year; and
(2) has made a Deferral Election for the Plan Year. Should the Plan terminate,
Active Participant status shall cease.
"BASE PAY" means a Participant's base salary. A Participant's Base Pay equals
his salary, exclusive of allowances and reimbursements.
"BENEFICIARY" means the person chosen on the Beneficiary Election Form to
receive the undistributed balance of benefits to which a Participant is entitled
to receive at the time of his death.
"BENEFICIARY ELECTION FORM" means the form provided by the Employer on which the
Participant selects his Beneficiary.
"BOARD" means the Board of Directors of Employer.
"BONUS PLAN" means the Allied Holdings, Inc. EVA Based Incentive Plan.
"CHANGE IN CONTROL" means any of the following events:
(a) The acquisition (other than from the Employer) by any "Person"
(as used for purposes of Section 13(d) or 14(d) of the
Exchange Act) of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of twenty
percent (20%) or more of the combined voting power of the
Employer's then outstanding voting securities; or
(b) The individuals who, as of the date of adoption of this Plan
by the Board, are members of the Board (the "Incumbent
Board"), cease for any reason to constitute
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at least two-thirds (2/3) of the Board; provided, however,
that if the election, or nomination for election by the
Employer's stockholders, of any new director was approved by a
vote of at least two-thirds (2/3) of the Incumbent Board, such
new director shall, for purposes of this Agreement, be
considered as a member of the Incumbent Board; or
(c) Approval by stockholders of the Employer of (i) a merger or
consolidation involving the Employer if the stockholders of
the Employer, immediately before such merger or consolidation
do not, as a result of such merger or consolidation, own,
directly or indirectly, more than seventy percent (70%) of the
combined voting power of the then outstanding voting
securities of the corporation resulting from such merger or
consolidation in substantially the same proportion as their
ownership of the combined voting power of the voting
securities of the Employer outstanding immediately before such
merger or consolidation, or (ii) a complete liquidation or
dissolution of the Employer or an agreement for the sale or
other disposition of all or substantially all of the assets of
the Employer.
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
pursuant to subsection (a) above, solely because twenty percent (20%) or more of
the combined voting power of the Employer's then outstanding securities is
acquired by (i) a trustee or other fiduciary holding securities under one or
more Employee benefit plans maintained by the Employer or any of its
subsidiaries, or (ii) any corporation which, immediately prior to such
acquisition, is owned directly or indirectly by the stockholders of the Employer
in the same proportion as their ownership of stock in the Employer immediately
prior to such acquisition.
"CODE" means the Internal Revenue Code of 1986, as amended from time to time,
and the regulations promulgated thereunder.
"COMPENSATION" means Base Pay, the cash awards payable under the Incentive Plan
and the cash payable under the Bonus Plan.
"DEFERRAL ELECTION" means an election to defer Compensation which would
otherwise be payable in cash.
"DEFERRAL ELECTION FORM" means the form supplied by Employer or the Plan
Administrator (or its designee) to Participants, on which numerous elections
with respect to the Plan are to be made.
"DEFERRAL ELECTION REVOCATION FORM" means the form supplied by Employer or the
Plan Administrator (or its designee) which revokes a Deferral Election Form.
"DISABILITY" means mental or physical disability as determined under the Allied
Holdings, Inc. Long-Term Disability Plan.
"EARLY RETIREMENT" means retirement under the conditions of and as such term is
defined in the Allied Holdings, Inc. Defined Benefit Plan.
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"ELECTIVE DEFERRAL" means an amount which would have been paid to Participant
but for a Deferral Election.
"EMPLOYEE" means an Employee of the Employer or a Subsidiary.
"EMPLOYER" means Allied Holdings, Inc. and its corporate successors.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"FISCAL YEAR" means the Employer's fiscal year beginning on January 1st and
ending on the subsequent December 31st.
"INCENTIVE PLAN" means the Allied Holdings, Inc. Long-Term Incentive Plan, as
amended and restated.
"NORMAL RETIREMENT" means retirement under the conditions of and as such term is
defined in the Allied Holdings, Inc. Defined Benefit Plan.
"PARTICIPANT" means an Employee or former Employee who has not received all of
the benefits to which he is entitled under the Plan. Should the Plan terminate,
Participant status shall cease for all individuals.
"PLAN" means this Allied Holdings, Inc. Deferred Compensation Plan, as it may be
amended from time to time.
"PLAN ADMINISTRATOR" means the Compensation Committee of the Employer. The Plan
Administrator may choose a designee(s) to handle some or all of its
responsibilities under the Plan.
"PLAN YEAR" means the twelve (12) month period beginning on January 1st and
ending on the subsequent December 31st.
"SUBSIDIARY" means any company in which the Employer owns, directly or
indirectly, at least a majority of the shares having voting power in the
election of directors.
ARTICLE II
PARTICIPATION
2.1 GENERAL. The Plan is intended to qualify as a "top hat" plan which is
exempt from Title I of ERISA. Accordingly, only a select group of
management or highly compensated employees may participate in this
Plan. Any provision of this Plan or any action taken by the Board, the
Plan Administrator or the Employer which would cause the Plan to fail
to qualify as a top hat plan under ERISA shall be null and void.
2.2 ANNUAL ELIGIBILITY DETERMINATION. Eligibility to participate in the
Plan shall be
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determined on an annual basis. An Employee who participates in the Plan
for any given Plan Year shall not be eligible to participate in the
Plan for any subsequent Plan Year unless such Employee satisfies the
eligibility requirements for such subsequent Plan Year.
2.3 ELIGIBILITY STANDARD. An Employee shall be eligible to participate in
the Plan for a Plan Year if the Employee holds the position of
vice-president or higher with the Employer. The Plan Administrator may,
in its sole discretion, allow other Employees to participate pursuant
to the provisions of Section 2.1. The Employer shall notify each
Employee eligible to participate in the Plan for a Plan Year of such
eligibility upon hire, promotion or at such time as administratively
practicable after the Plan Administrator, in its sole discretion, deems
an Employee eligible to participate in the Plan.
2.4 ELECTION TO PARTICIPATE. Subject to Sections 2.5 and 2.7, in order to
participate in the Plan for a Plan Year, an eligible individual must
properly complete and submit to the Plan Administrator a Deferral
Election on a Deferral Election Form. Employees must follow the annual
enrollment procedures set forth in Section 2.5. However, in the case of
a new Employee selected as an eligible Employee as of his date of hire,
such Employee shall be eligible to participate during such Plan Year of
hire if, within sixty (60) days from his date of hire, he submits a
Deferral Election Form to participate; such Deferral Election Form
shall be effective for the first month after the month it is received
by the Plan Administrator and shall remain in effect for the remainder
of the then current Plan Year.
2.5 ANNUAL ENROLLMENT. The Deferral Election Form submitted by an eligible
Employee shall only be effective for the Plan Year to which it relates.
An eligible Employee must submit a Deferral Election Form for each
subsequent Plan Year. Such election must be received by the Plan
Administrator no later than December 27th of the Plan Year which
immediately precedes the Plan Year for which participation is elected,
provided that if December 27th falls on a weekend, a Participant may
submit his Deferral Election form on the next business day following
December 27th. If a Deferral Election form is mailed to the Plan
Administrator, the post mark date shall be considered the date of
receipt by the Plan Administrator.
2.6 REVOCATION. A Deferral Election may be prospectively revoked. A
revocation shall apply only with respect to pay periods beginning after
the date the revocation is received by the Plan Administrator. A
revocation is effectuated by filing a Deferral Election Revocation Form
with the Plan Administrator. A Participant may revoke a Deferral
Election as to Base Pay, the Incentive Plan cash award and/or the Bonus
Plan cash award which would otherwise be payable to the Participant.
2.7 FORMER ACTIVE PARTICIPANTS. If a Participant is not an Active
Participant, his Account will be distributed in the manner elected on
his Deferral Election Form(s) (and, if applicable, his Distribution
Election Change Form) at such time said Participant is eligible for a
distribution pursuant to the provisions of Article VI.
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ARTICLE III
TYPES OF COMPENSATION ELIGIBLE FOR DEFERRAL
3.1 GENERAL DEFERRAL ELECTION. An individual eligible to participate may
elect to defer a specific amount or a specific percentage of his Base
Pay which would otherwise be payable for the Plan Year following the
Plan Year in which the Deferral Election is made. The period in which
deferrals are made will correspond with the period in which the Base
Pay would have been paid. Any such amount shall be elected on the
Deferral Election Form.
3.2 DEFERRAL ELECTION AS TO INCENTIVE PLAN. An individual eligible to
participate may elect to defer a specific percentage of his cash award
earned for the Plan Year following the Plan Year in which the Deferral
Election is made under the Incentive Plan (which would otherwise be
payable in the Plan Year next following the Plan Year to which the
Deferral Election relates). Any such election shall be made on the
Deferral Election Form.
3.3 DEFERRAL ELECTION AS TO BONUS PLAN. A Participant may elect to defer a
specific percentage of his annual bonus earned for the Plan Year
following the Plan Year in which the Deferral Election is made under
the Bonus Plan (which would otherwise be payable in the Plan Year next
following the Plan Year to which the Deferral Election relates). Any
such election shall be made on the Deferral Election Form.
3.4 TIMING OF DEFERRALS. Amounts deferred under Section 3.1 shall be
withheld from Base Pay on an equal pro rated basis throughout the
entire Plan Year for which the Deferral Election applies.
3.5 LIMITATION ON DEFERRALS. Notwithstanding anything in this Article III
to the contrary, Elective Deferrals shall not be limited for any Plan
Year, and Participants may defer up to 100% of their Compensation.
Subject to Section 2.6, a Participant's Elective Deferrals for a Plan
Year will be accepted until the Participant retires or his employment
is terminated.
ARTICLE IV
OPTIONAL BENEFIT FORMS, ELECTIONS AND TIMING OF BENEFIT PAYMENTS
4.1 DISTRIBUTION FORMS. All benefits under the Plan shall be paid in cash
from the Employer's general assets and are subject to the claims of the
Employer's general creditors. Benefits distributed under the Plan,
except in the case of retirement, death, Disability or other
termination of employment, are subject to a withdrawal penalty. There
is a ten percent (10%) penalty for in-service distributions pursuant to
Section 6.4 and a five percent (5%) penalty for hardship distributions
pursuant to Section 6.5. Installment payments shall be calculated by
dividing the Participant's Account by the number of installments
remaining.
(a) Participants may elect to receive their benefits as either:
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(i) a lump-sum distribution; or
(ii) annual installments payable over a period no less
than two (2) years and no more than ten (10) years.
(b) Payment(s) will commence as of the later of (i) January of the
Plan Year following the Plan Year of retirement or other
termination or (ii) as soon as administratively practicable
following retirement or other termination.
4.2 ELECTION OF BENEFIT FORMS. In accordance with Section 2.5, the
distribution form chosen pursuant to Section 4.1 must be elected on the
Deferral Election Form prior to the time the Compensation to which the
benefit form relates is earned and payable. A distribution benefit form
chosen prior to a Plan Year shall apply to amounts deferred in the
immediately following Plan Year and to amounts deferred in all
subsequent Plan Years, unless a Distribution Election Change Form is
submitted to the Plan Administrator, in which case the distribution
benefit form chosen under the Distribution Election Change Form shall
apply to amounts deferred in Plan Years following the Plan Year of
receipt of such Form by the Plan Administrator. However, the benefit
form chosen under the prior Deferral Election Form (or Distribution
Election Change Form, if applicable) shall apply as to Elective
Deferrals made while such prior Deferral Election Form (or Distribution
Election Change Form, if applicable) was operative. At any time, a
Participant may change his benefit form with respect to future Elective
Deferrals, to be effective as of the beginning of the next Plan year,
by filing a Distribution Election Change Form with the Plan
Administrator.
4.3 BENEFICIARY ELECTION. Each Participant may designate a Beneficiary or
Beneficiaries to receive benefits to which the Participant is entitled
and which are undistributed and remaining in the Plan at the time of
the Participant's death. Such election shall be made on the Beneficiary
Election Form provided by the Employer. A Participant may change his
Beneficiary Election at any time. Notwithstanding Section 4.2, benefits
(including any installment benefits not yet paid) shall be paid in
accordance with Section 6.1 in the event of the death of a Participant.
4.4 SUPREMACY OF ARTICLE VI. Notwithstanding Section 4.2, benefits shall be
paid in accordance with Section 6.1 in the event of the death of a
Participant and in accordance with Section 6.2 in the event of the
Disability of the Participant.
ARTICLE V
ACCOUNTS, EARNINGS AND INVESTMENTS
5.1 ACCOUNTS. The Plan Administrator shall maintain records of Accounts for
Participants to which amounts deferred shall be credited.
5.2 INTEREST CREDIT TO ACCOUNTS. Any Account which is distributed, in whole
or in part,
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shall be credited with interest accruing from the date of the deferral
until the date of distribution at a rate equal to the Average Corporate
Rate of Moody's Long-Term Corporate Bond Yield Averages (the "Interest
Rate"). The Interest Rate for any Plan Year shall be calculated as of
June 30th of the preceding Plan Year. (For the 2001 Plan Year, the June
30, 2000 rate shall apply.) If, in any given calendar year, June 30th
should fall on either a Saturday or Sunday, the Interest Rate shall be
calculated as of the immediately preceding Friday (June 29th or June
28th, as applicable). Such Interest Rate earnings shall be (a)
compounded daily during the applicable Plan Year; (b) paid by the
Employer from its general assets; and (c) subject to the claims of the
Employer's general creditors. Accounts distributed on an installment
basis shall continue to be credited with Interest Rate earnings until
such accounts have been fully distributed.
ARTICLE VI
TIMING OF DISTRIBUTIONS
6.1 DEATH. In the event of the death of a Participant, such Participant's
Account balance shall be paid to his Beneficiary as soon as
administratively practicable following death. In the event the
Participant dies after installment distributions have begun, the
Beneficiary shall receive the undistributed balance of the
Participant's Account as a lump-sum distribution. In the event the
Participant dies before distributions have begun, the Beneficiary shall
receive the Participant's undistributed balance as a lump-sum
distribution. In the event the Participant dies without a valid
Beneficiary Designation Form, the Participant's Account Balance will be
paid to the Participant's estate. No additional benefits shall be
payable thereafter to anyone with respect to such Participant or his
benefits. A Beneficiary Designation Form shall become null and void
upon a Participant's divorce or legal separation.
6.2 DISABILITY. In the event of the Disability of a Participant prior to
termination of employment or retirement, a Participant's benefits shall
be paid in the benefit form elected on his Deferral Election Form as if
the Participant retired. Consistent with Section 4.1(c), if a lump-sum
distribution option was elected, then such distribution shall be made
as soon as administratively practicable following the determination of
Disability. Consistent with Section 4.1(c), if an installment option
was elected, then the initial installment payment shall be made as soon
as administratively practicable following the determination of
Disability.
6.3 EARLY AND NORMAL RETIREMENT AND OTHER EMPLOYMENT TERMINATION
DISTRIBUTIONS. In the event of termination of employment upon Early
Retirement or Normal Retirement, or upon any other termination of
employment other than due to death or Disability, a Participant shall
be paid his Account pursuant to the benefit form chosen under Section
4.1(a). Consistent with Section 4.1(c), if a lump-sum distribution
option was elected, then such distribution shall be made by the later
of: (a) January of the Plan Year following the Plan Year of retirement
or other termination; or (b) as soon as administratively practicable
following retirement or other termination. Consistent with Section
4.1(c), if an installment payments option was elected, then the initial
installment
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payment shall be made by the later of: (a) January of the Plan Year
following the Plan Year of retirement or other termination; or (b) as
soon as administratively practicable following retirement or other
termination. If the Participant elected to receive installment
payments, subsequent Disability of the Participant after installments
have begun shall have no impact on the installment benefits being
received.
6.4 IN-SERVICE DISTRIBUTIONS. Upon submission of a request by a Participant
in a situation which is not described in Section 6.5, the Plan
Administrator will make an in-service distribution to the Participant
from the Participant's Account equal to the amount requested less an
early withdrawal penalty equal to ten percent (10%) of the amount
requested. Participants may make only one in-service distribution
request during each Plan Year. Additionally, any Active Participant who
receives an in-service distribution shall be ineligible to participate
in the Plan for the remainder of the then current Plan Year and for the
entirety of the next subsequent Plan Year.
6.5 HARDSHIP DISTRIBUTIONS. Upon submission of a request by a Participant,
the Plan Administrator will make a hardship distribution to such
Participant in an amount not to exceed the hardship amount by more than
five percent (5%). For this purpose, a hardship is an immediate and
heavy financial need of the Participant and hardship distributions will
be made for:
(a) Expenses for medical care described in section 213(d) of the
Code previously incurred by the Participant, the Participant's
spouse, or any dependents of the Participant or necessary for
these persons to obtain medical care described in section
213(d) of the Code;
(b) Costs directly related to the purchase of a principal
residence for the Participant (excluding mortgage payments);
(c) Payment of tuition, related educational fees, and room and
board expenses, for the next 12 months of post-secondary
education for the Participant, or the Participant's spouse,
children, or dependents; or
(d) Payments necessary to prevent the eviction of the Participant
from the Participant's principal residence or foreclosure on
the mortgage on that residence.
For purposes of this Section 6.5, the term "hardship amount" means an
amount no greater than 105% of the amount necessary to satisfy the
financial need resultant from one of the above described hardship
situations. The Plan Administrator, in its sole discretion, shall
decide whether an event qualifies as a hardship and shall further
decide the hardship amount. Hardship distributions will be paid in a
lump-sum, less a five percent (5%) early withdrawal penalty, and
payment will be made as soon as administratively practicable following
approval. Any Participant who receives a hardship distribution shall be
ineligible to participate in the Plan for the remainder of the then
current Plan Year. Only one hardship distribution shall be made in any
Plan Year.
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6.6 CHANGE IN CONTROL. Upon the occurrence of a Change in Control, unless
the surviving entity after the Change in Control agrees to assume the
Plan (as determined by the Plan Administrator), the Plan shall be
terminated as soon as administratively feasible before, after or
simultaneous with such Change in Control, and Participants shall be
paid their Accounts in accordance with the termination provisions of
Section 9.3.
ARTICLE VII
RIGHTS OF PARTICIPANTS
Participants have the status of general unsecured creditors of the
Employer. The Plan constitutes a mere promise by the Employer to make benefit
payments in the future. It is the intention of the Participants, the Employer
and the Plan Administrator that the arrangements provided herein be "unfunded"
for purposes of Title I of ERISA.
ARTICLE VIII
ADMINISTRATION AND MISCELLANEOUS
8.1 ADMINISTRATION. The Plan Administrator shall administer and interpret
this Plan in accordance with the provisions specified herein. Any
determination or decision by the Plan Administrator shall be conclusive
and binding on all persons who at any time have or claim to have any
interest whatsoever under this Plan.
8.2 LIABILITY OF PLAN ADMINISTRATOR, INDEMNIFICATION. To the extent
permitted by law, no member of the committee serving as Plan
Administrator shall be liable to any person for any action taken or
omitted in connection with the interpretation and administration of
this Plan unless attributable to his own gross negligence or willful
misconduct. The Employer shall indemnify the members of the committee
serving as Plan Administrator against any and all claims, losses,
damages, expenses, including counsel fees, incurred by them, and any
liability, including any amounts paid in settlement with their
approval, arising from their action or failure to act, except when the
same is judicially determined to be attributable to their gross
negligence or willful misconduct.
8.3 EXPENSES AND BOOKS AND RECORDS. The books and records to be maintained
for the purpose of the Plan shall be maintained by the Employer at its
expense and subject to the supervision and control of the Plan
Administrator. All expenses of administering the Plan shall be paid by
the Employer.
8.4 BENEFITS NOT ASSIGNABLE. The right of any Participant in any benefit or
to any payment hereunder shall not be subject in any manner to
attachment or other legal process for the debts of such Participant;
and any such benefit or payment shall not be subject to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment
or garnishment by creditors of the Participant.
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8.5 GOVERNING LAW. All rights and benefits hereunder shall be governed and
construed in accordance with the laws of the State of Georgia.
8.6 ADOPTION BY SUBSIDIARIES. The Employer may, by adoption agreement,
allow any Subsidiary to adopt the Plan and thereby allow its eligible
Employees to participate in the Plan. Any provision of this Plan
applicable to a Subsidiary shall only apply if such Subsidiary adopts
the Plan. A Subsidiary's adoption may be retroactive.
8.7 SEVERABILITY. In the event that any provision of this Plan shall be
declared illegal or invalid for any reason, said illegality or
invalidity shall not affect the remaining provisions of this Plan but
shall be fully severable and this Plan shall be construed and enforced
as if said illegal or invalid provision had never been inserted herein.
However, after deletion or elimination of any illegal or invalid
provision, the remaining provisions of the Plan shall be construed in a
manner so as to achieve, as closely as possible, the intent and
objectives of the Plan, as provided by reading the Plan in its
entirety.
8.8 CONSTRUCTION. The article and section headings and numbers are included
only for convenience of reference and are not to be taken as limiting
or extending the meaning of any of the terms and provisions of this
Plan. Whenever appropriate, words used in the singular shall include
the plural or the plural may be read as the singular. Where
appropriate, pronouns used in the masculine shall be read to include
the feminine on neuter.
8.9 INFORMATION TO BE FURNISHED. Participants shall provide the Employer
and the Plan Administrator with such information and evidence, and
shall sign such documents, as may reasonably be requested from time to
time for the purpose of administration of the Plan.
ARTICLE IX
AMENDMENT OR TERMINATION OF PLAN
9.1 AMENDMENT. The Plan may be amended in whole or in part from time to
time by the Employer. However, no amendment shall reduce the benefits
accrued through the date of the amendment. For this purpose, a right to
receive a particular benefit form or optional form of benefit shall be
considered neither a benefit which has accrued nor an accrued benefit.
9.2 NOTICE TO PARTICIPANTS. Notice of any such amendment shall be given in
writing to each Participant.
9.3 PLAN MAY BE TERMINATED AT ANY TIME. The Plan has been created by the
Employer voluntarily. The Employer reserves the right to terminate the
Plan at any time. Upon termination, all Deferral Elections shall cease.
Benefits may be paid from the Plan in lump-sums or installments, as
chosen by the Plan Administrator. If the Plan Administrator makes
installment payments, it may discontinue such installments at any
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time and pay lump-sum distributions for remaining Accounts. The Plan
Administrator may defer payment of benefits following termination of
the Plan until the time distributions would ordinarily be paid to
Participants pursuant to prior elections, provided that the Plan
Administrator shall be authorized to pay benefits whenever it chooses
following termination of the Plan.
IN WITNESS WHEREOF, the Employer has caused this Plan to be executed
this 29th day of November, 2000 to be effective as of January 1, 2001.
<TABLE>
<CAPTION>
ATTEST: ALLIED HOLDINGS, INC.
<S> <C>
/s/ Thomas M. Duffy By: /s/ Randall E. West
-------------------------------------------- -------------------------
Thomas M. Duffy Randall E. West
Vice President - Corporate Affairs, President, Chief Operating
Secretary and General Counsel Officer and Director
(CORPORATE SEAL)
</TABLE>
