CNF INC.
RESTRICTED STOCK AWARD AGREEMENT
THIS AGREEMENT, entered into as of the ____ day of _________, ____, between
CNF Inc., a Delaware corporation (hereinafter called "Company"), [Name of
Executive] (hereinafter called "Recipient"), and the Secretary of the Company
(hereinafter called "Escrow Holder").
WITNESSETH:
WHEREAS, the Company has adopted the CNF Inc. 1997 Equity and Incentive Plan,
as amended (as so amended, the "Plan"), which Plan is incorporated into this
Agreement by reference;
WHEREAS, the Company encourages its executive officers to own shares of the
Company's stock and thereby to align their interests more closely with the
interests of the other stockholders of the Company, desires to motivate
Recipient by providing Recipient with a direct interest in the Company's
attainment of its financial goals, and desires to provide a financial
incentive that will help attract and retain the most qualified executive
officers; and
WHEREAS, the Company has determined that it would be to the advantage and
interest of the Company and its stockholders to issue to Recipient the
restricted stock provided for in this Agreement as an incentive for increased
efforts and successful achievements;
NOW, THEREFORE, in consideration of the foregoing premises, and the mutual
covenants herein contained, the parties hereto agree with each other as
follows:
1. Defined Terms. Except as otherwise indicated herein, all capitalized
terms used in this Agreement without definition shall have the meanings
given to such terms in the Plan.
2. Restricted Stock Award. As of the date of this Agreement, the Company
has issued to Recipient ______ shares of its Common Stock (hereinafter
called the "Stock") as a restricted stock award ("Restricted Stock
Award"). Stock certificates evidencing the Stock will be delivered to
Escrow Holder, accompanied by blank stock powers executed by Recipient,
to be held by Escrow Holder as provided herein, for the use and benefit
of, and subject to the rights of and limitations upon Recipient as the
owner thereof as herein set forth. Subject to Paragraphs 3, 4 and 5
below, Recipient shall have all rights of a stockholder with respect to
shares of Stock issued hereunder, including the right to vote, to
receive dividends (including stock dividends), to participate in stock
splits or other recapitalizations, and to exchange such shares in a
merger, consolidation or other reorganization. The Company shall pay
the costs and charges of Escrow Holder and any applicable stock transfer
taxes. Recipient hereby acknowledges that Recipient is acquiring the
Stock issued hereunder for investment and not with a view to the
distribution thereof, and that Recipient does not intend to subdivide
Recipient's interest in the Stock with any other person.
3. Restrictions. Until such time as a share of Stock vests or is forfeited
in accordance with Paragraph 4 below, such share shall be classified as
a "Restricted Security" and shall be subject to the following:
(a) All Restricted Securities shall be evidenced by one or more
certificates which are held by Escrow Holder and which bear the
following legend:
"These shares are subject to the restrictions enumerated in the CNF
Inc. 1997 Equity and Incentive Plan and in the Restricted Stock
Award Agreement dated as of __________, ____ between CNF Inc. and
the registered holder of these shares."
Upon vesting of any shares of Stock, the Company shall cause new
stock certificates to be issued to evidence the Stock. All shares
of Stock that have vested, and that therefore are no longer
classified as Restricted Securities, shall be evidenced by a new
certificate which does not bear the legend referred to above, which
certificate shall be delivered by Escrow Holder to Recipient.
All shares (if any) of Stock which remain unvested at such time,
and which therefore continue to be classified as Restricted
Securities, shall be evidenced by a new certificate bearing the
legend referred to above, which certificate shall be delivered to
and held by Escrow Holder.
(b) All Restricted Securities shall be subject to the limitations on
transferability set forth in Section 9(a) of the Plan, except that
the Committee may, in its discretion, (i) pursuant to rules adopted
by the Committee, permit transfer(s) of Restricted Securities in
connection with Recipient's estate planning, and (ii) permit
transfers upon divorce or marital dissolution other than pursuant
to a Qualified Domestic Relations Order.
(c) All distributions on or in respect of any Restricted Securities
(including dividends on any Restricted Securities, whether payable
in cash, stock or other property) shall be subject to the
provisions of Paragraph 5 below.
4. Vesting; Forfeiture.
(a) Subject to subparagraph (b) of this Paragraph 4, the shares of
Stock shall vest in three (3) equal installments, commencing on
________, ____ and continuing on each _________ thereafter to and
including ________, ____, provided that Recipient has been an
active full-time employee of the Company, a Subsidiary, or an
Affiliate at all times during the period from the date of this
Agreement until such date.
(b) All shares of Stock (if any) which have not vested shall vest upon
the earliest to occur of the following, provided that Recipient has
been an active full-time employee of the Company, a Subsidiary or
an Affiliate at all times during the period from the date of this
Agreement until the date of such occurrence:
(1) Recipient's death;
(2) Termination of Recipient's employment with the Company, a
Subsidiary or an Affiliate as a result of a Disability; or
(3) Upon a "Change in Control" (as defined in the Plan) applicable
to Recipient (whether or not Recipient remains an employee of
the Company, a Subsidiary or Affiliate following such Change
in Control).
As used herein, "Disability" means a substantial mental or physical
disability, as determined by the Committee in its sole discretion.
(c) All shares of Stock (if any) which have not vested shall be
automatically, immediately and irrevocably forfeited if Recipient
ceases to be an active full-time employee of the Company, a
Subsidiary or an Affiliate for any reason other than as a result of
an occurrence described in subparagraph (b) above. For avoidance of
doubt, all shares of Stock (if any) which have not vested shall be
automatically, immediately and irrevocably forfeited if Recipient
retires, whether prior to, at or after normal retirement age. Upon
forfeiture of any shares of Stock, all right, title and interest of
Recipient in such Stock, and in any distributions contemplated by
Paragraph 5 (other than cash dividends received by Recipient
pursuant to Paragraph 5 prior to such forfeiture), shall thereupon
cease; and all right, title and interest in and to such Stock and
distributions shall vest in the Company, with no compensation or
consideration to Recipient.
5. Distributions on Restricted Securities
(a) Any securities or other property (other than cash) received as the
result of ownership of Restricted Securities ("Additional
Securities") including, but not by way of limitation, warrants and
securities received as a stock dividend or stock split, or as a
result of a recapitalization or reorganization, shall be held by
Escrow Holder in the same manner and subject to the same
restrictions as the Restricted Securities with respect to which
they were issued. Recipient shall be entitled to direct Escrow
Holder to exercise any warrant or option received as Additional
Securities upon supplying the funds necessary to do so, in which
event the securities so purchased shall constitute Additional
Securities, or Recipient may direct Escrow Holder to sell any such
warrant or option, in which case the proceeds shall be held by
Escrow Holder in accordance with the provisions of subparagraph (b)
below.
In the event any Restricted Securities or Additional Securities
consist of a security that is by its terms or otherwise convertible
into or exchangeable for another security at the election of the
holder thereof, Recipient may exercise any such right of conversion
or exchange in the event the failure to exercise or delay in
exercising such right would result in its loss or diminution in
value, and any securities so acquired shall constitute Additional
Securities. In the event of any change in certificates evidencing
Restricted Securities or Additional Securities by reason of any
recapitalization, reorganization or other transaction which results
in the creation of Additional Securities, Escrow Holder is
authorized to deliver to the issuer the certificates evidencing
Restricted Securities or Additional Securities in exchange for the
certificates which they replace, which shall be deemed to be
Additional Securities.
(b) All cash dividends payable in respect of any Restricted Securities
shall be paid to Recipient on the dividend payment date on which
such cash dividends are paid to other registered holders of the
Company's Common Stock. The Company shall deliver to Escrow Holder
for the account of Recipient all distributions, other than cash
dividends on the Restricted Securities, paid or made in cash with
respect to Restricted Securities and Additional Securities ("Cash
Distributions"). Escrow Holder shall hold all such Cash
Distributions until deliverable to Recipient in accordance with
subparagraph (c) below.
(c) Concurrently with the delivery to Recipient, pursuant to Paragraph
3 above, of certificates evidencing any shares of Stock that have
vested and therefore are no longer Restricted Securities, Escrow
Holder shall also deliver to Recipient (i) one or more certificates
evidencing all shares of Additional Securities distributed to
Escrow Holder in respect of such Stock (which certificate(s) shall
not contain the legend referred to in Paragraph 3 above) and (ii)
all Cash Distributions received by Escrow Holder in respect of such
Stock and Additional Securities, less any applicable withholding
requirements (including federal, state, local, and foreign income,
Social Security, and Medicare tax requirements.
6. Taxes
(a) Recipient agrees to make appropriate arrangements for the
satisfaction of any applicable federal, state or local income,
employment or other tax withholding requirements (collectively, the
"Taxes") applicable to the receipt of Stock hereunder upon the
lapse of restrictions with respect thereto or upon the exercise of
an election by Recipient under Section 83(b) of the Internal
Revenue Code.
(b) Upon demand, Recipient shall promptly pay to the Company the amount
of all applicable Taxes that the Company is required to withhold
and pay on behalf of Recipient with respect to the shares of Stock
issued hereunder. At its discretion, the Company may withhold any
distribution under this Agreement in whole or in part until such
payment is made to the Company. In lieu thereof, the Company or an
Affiliate may withhold such amounts as are necessary to pay such
Taxes from any fees, salary, bonus or other amounts payable by the
Company or an Affiliate to Recipient, or the Company may withhold a
number of shares of Stock having a market value not exceeding the
amount of such Taxes and cancel (in whole or in part) any such
shares in order to satisfy the payment of such Taxes.
Alternatively, the Recipient may elect to have the Company withhold
a number of shares of Stock having a market value not exceeding the
amount of such Taxes. In determining the market value of shares of
Stock for purposes of paying Taxes pursuant to this subparagraph
(b), the Company shall use (i) in the case of Taxes arising as a
result of the lapse of restrictions with respect to shares of
Stock, the closing price of a share of Stock on the New York Stock
Exchange on the date that such restrictions lapse, and (ii) in the
case of Taxes arising as a result of a timely and valid exercise by
Recipient of an election under Section 83(b) of the Internal
Revenue Code, the closing price of a share of Stock on the New York
Stock Exchange on the date of issuance of the shares of Stock
subject to such election.
7. Committee Decisions Conclusive. All decisions of the Committee upon any
question arising under the Plan or under this Agreement shall be final
and binding on all parties (except for any change occurring pursuant to
the claims procedures set forth in Section 8 of the Plan).
8. No Right to Continued Employment, etc. Nothing in this Agreement, the
Restricted Stock Award granted hereunder or any other agreement entered
into pursuant hereto (i) shall confer upon Recipient the right to
continue in the employ of the Company, any Subsidiary or any Affiliate
or to be entitled to any remuneration or benefits not set forth herein
or in any such other agreement or (ii) interfere with or limit in any
way the right of the Company or any such Subsidiary or Affiliate to
terminate Recipient's employment.
9. Notice. Any notice or other paper required to be given or sent pursuant
to the terms of this Agreement shall be sufficiently given or served
hereunder to any party when transmitted by registered or certified mail,
postage prepaid, addressed to the party to be served as follows:
Company: CNF Inc., 2855 Campus Drive, Suite 300, San Mateo, CA 94403
Attn.: Corporate Secretary
Recipient:At Recipient's address as it appears under Recipient's
signature to this Agreement, or to such other address as
Recipient may specify in writing to Escrow Holder
Any party may designate another address for receipt of notices so long
as notice is given in accordance with this Paragraph 9.
10. Amendment; Modification. This Agreement may not be modified or amended,
and any provision hereof may not be waived, except pursuant to a written
agreement signed by the Company and Recipient. Any such modification,
amendment or waiver signed by, or binding upon, Recipient, shall be
valid and binding upon any and all persons or entities who may, at any
time, have or claim any rights under or pursuant to this Agreement.
11. Severability. If any provision of this Agreement shall be invalid or
unenforceable, such invalidity or unenforceability shall attach only to
such provision and shall not in any manner affect or render invalid or
unenforceable any other severable provision of this Agreement, and this
Agreement shall be carried out as if such invalid or unenforceable
provision were not contained herein.
12. Successors. Except as otherwise expressly provided herein, this
Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective heirs, executors, administrators,
successors and assigns.
13. Governing Law. The interpretation and enforcement of this Agreement
shall be governed by the internal laws of the State of Delaware without
regard to principles of conflicts of laws.
14. Counterparts. This Agreement may be executed in counterparts, all of
which taken together shall be deemed one original.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the date first above written.
RECIPIENT CNF INC.
By:______________________ By:_______________________
Name Jennifer W. Pileggi
[Address] Sr VP General Counsel & Secretary
{Address] 2855 Campus Drive, Suite 300
San Mateo, CA 94403
By:_______________________
Escrow Holder