AMERICAN FREIGHTWAYS CORPORATION
AMENDED AND RESTATED
APPOINTED NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
SECTION 1
1. This 1997 Non-Employee Director Stock Option Plan (the
"Plan") as last amended and restated in July, 1998 is intended to
attract and retain the services of a non-employee director
("Director") of American Freightways Corporation (the "Company"),
for the benefit of the Company and its shareholders and to provide
additional incentive for such persons to continue to work for the
best interests of the Company and its shareholders. This Plan is
intended exclusively for the benefit of persons who are appointed
by the Board (defined below) to fill an existing vacancy on such
Board. The effective date of the Plan, prior to its amendment and
restatement, was May 20, 1997.
2. ADMINISTRATION. The Plan shall be administered by the
Board of Directors of the Company (the "Board"). The Board shall
have the power to construe the Plan, to determine all questions
arising thereunder and to adopt and amend such rules and
regulations for the administration of the Plan as it may deem
desirable.
The interpretation and construction by the Board of any
provisions of the Plan or of any option granted under it shall be
final. No member of the Board shall be liable for any action or
determination made in good faith with respect to the Plan or any
option granted under it.
3. ELIGIBILITY. Each person who shall have been appointed
by the Board to fill an then-existing vacancy shall automatically
be granted options to purchase 2,000 shares of the Company's common
stock (subject to further adjustment as provided herein) as of the
date of such appointment and on each succeeding first day in
February, provided, that such automatic option grants shall be made
only if the recipient director (i) is not otherwise an employee of
the Company or any subsidiary on the date of grant, (ii) is a
member of the Board of Directors on the date such option is
granted. Effective February 1, 1998, grants of options under this
Plan shall be for 6,000 shares of the Company's common stock.
The dates on which options are granted hereunder are referred
to herein as the "Grant Date."
All options granted to any Directors under this Section 1
shall vest at the rate of 33.3% per year beginning on the first
anniversary of the Grant Date, except as otherwise provided in
Section 2.
No person may receive in a single year grants of options under
this Plan and grants of options under the Company's Elected Non-
Employee Director Stock Option Plan.
4. SHARES OF STOCK SUBJECT TO THE PLAN. The shares that may
be issued under the Plan shall be authorized and unissued or
reacquired shares of the Company's common stock (the "Common
Stock"). The aggregate number of shares which may be issued under
the Plan shall not
exceed 22,000 shares of Common Stock, unless an
adjustment is required in accordance with Section 3.
5. AMENDMENT OR TERMINATION OF THE PLAN. The Board of
Directors may, insofar as permitted by law, from time to time,
suspend or terminate the Plan or revise or amend it in any respect
whatsoever, except that no such amendment shall alter or impair or
diminish any rights or obligations under any option theretofore
granted under the Plan without the consent of the person to whom
such option was granted. In addition no such amendment shall be
effective without shareholder approval if such approval is required
in order to assure the Plan's continued qualification under Rule
16b-3 promulgated under the Securities Exchange Act of 1934, as
amended. The Plan's provisions regarding the formula for
determining the amount, exercise price, and timing of options to be
granted under the Plan shall in no event be amended more than once
every six months, other than to comport with changes in the
Internal Revenue Code of 1986, as amended.
6. EXPIRATION OF PLAN. Options may be granted under the
Plan until February 1, 1999. Notwithstanding the foregoing, each
option granted under the Plan shall remain in effect until such
option has been satisfied by the issuance of shares or terminated
in accordance with its terms and the terms of the Plan.
7. NONASSIGNABILITY. No option shall be assignable or
transferable by the grantee except by will or by the laws of
descent and distribution. Except as provided in Section 2, during
the lifetime of the optionee, the option shall be exercisable only
by him or her, and no other person shall acquire any rights
therein.
8. WITHHOLDING TAXES. Whenever shares of Common Stock are
to be issued under the Plan, the Company shall, at its option,
require the optionee to remit to the Company an amount sufficient
to satisfy federal, state and local withholding tax requirements
prior to the delivery of any certificate or certificates for such
shares.
9. DEFINITION OF "FAIR MARKET VALUE". For the purposes of
this Plan, the term "fair market value," when used in reference to
the date of grant of an option shall be the mean:
If the Shares of the Company are listed on a national
securities exchange (including the New York, American or NASDAQ
National Market System) in the United States on the date any Option
is granted, the fair market value per Share shall be deemed to be
the average of the high and low sale prices per share of such
Shares of the Company on such national securities exchange in the
United States on such date, as published by the Wall Street Journal
or other reliable publication, but if the Shares of the Company are
not traded on such date or such national securities exchange is not
open for business on such date, the fair market value per Share
shall be the average of such high and low sale prices on the last
preceding date on which such exchange shall have been open for
business and the Shares of the Company were traded. If the Shares
of the Company are listed on more than one
national securities exchange in the United States on the date any such
Option is granted, the Committee shall determine, in its discretion, which
national securities exchange shall be used for the purpose of
determining the fair market value per Share.
If at any date any Option is granted a public market exists
for the Shares of the Company but such Shares are not listed on a
national securities exchange in the United States, the fair market
value per Share shall be deemed to be the mean between the closing
bid and asked quotations in the over-the-counter market for such
Shares of the Company in the United States on the date such Option
is granted. If there are no bid and asked quotations for such
Shares on such date, the fair market value per Share shall be
deemed to be the mean between the closing bid and asked quotations
in the over-the-counter market in the United States for such Shares
of the Company on the closest date preceding the date such Option
is granted, for which such quotations are available.
SECTION 2
STOCK OPTIONS
1. AWARD OF STOCK OPTIONS. Awards of stock options shall be
made under the Plan under all the terms and conditions contained
herein. Each option granted under the Plan shall be evidenced by
an option agreement duly executed on behalf of the Company and by
the recipient, which option agreements shall comply with and be
subject to the terms and conditions of the Plan. Any option
agreement may contain such other terms, provisions and conditions
not inconsistent with the Plan as may be determined by the Board.
2. TERM OF OPTIONS AND EFFECT OF TERMINATION.
Notwithstanding any other provision of the Plan, no option granted
under the Plan shall be exercisable after the expiration of ten
years from the date of its grant.
In the event that any outstanding option under the Plan
expires by reason of lapse of time or otherwise is terminated for
any reason, the shares of Common Stock subject to any such option
which have not been issued pursuant to the exercise of the option
shall again become available in the pool of shares of Common Stock
for which options may be granted under the Plan.
3. TERMS AND CONDITIONS OF OPTIONS. Options granted
pursuant to the Plan shall be evidenced by agreements in such form
as the Board shall from time to time determine, which agreements
shall comply with the following terms and conditions.
A. Number of Shares. Each option agreement shall state the
number of shares to which the option pertains.
B. Option Price. Each option agreement shall state the
option price per share (or the method by which such price shall be
computed), which shall be equal to 100% of the Fair Market Value of
a share of the Common Stock on the date such option is granted.
C. Medium and Time of Payment. The option price shall be
payable upon the exercise of an option in the legal tender of the
United States. Upon receipt of payment, the Company shall deliver
to the optionee (or person entitled to exercise the option) a
certificate or certificates for the shares of Common Stock to which
the option pertains.
D. Exercise of Options. Except as otherwise specifically
provided herein, options granted under the Plan shall vest and
become exercisable in 33.3% increments per year, beginning on the
first anniversary of the Grant Date of the Option.
To the extent that an option has become exercisable and
subject to the restrictions and limitations set forth in this Plan
and any option agreement, it may be exercised in whole or such
lesser amount as may be authorized by the option agreement. If
exercised in part, any vested, unexercised portion of an option
shall continue to be held by the optionee and may thereafter be
exercised as provided herein.
E. Termination of Director. If an optionee ceases to be a
director for any reason other than (a) his death or disability or
(b) his decision not to stand for reelection as director at the
expiration of his term, any option held by such person may be
exercised at any time within 90 days after the date on which such
person ceased to be a director, but only to the extent the option
was vested and exercisable at such date.
If an optionee declines to stand for reelection as director at
the expiration of his term, or if an optionee becomes disabled
prior to the expiration of his term, any vested or unvested options
held by such person as of the date of term expiration or
disability, as the case may be, shall continue to be subject to
this agreement for vesting, exercise and expiration purposes.
If an optionee dies prior to the expiration of his term as
director (or dies after declining to stand for reelection or after
becoming disabled while serving pursuant to the preceding
paragraph), any unvested option held by such person shall
immediately become fully vested and exercisable on the date of
death, and any option held by such director, whether vesting on or
before the date of his death, may be exercised at any time by such
person's estate within one year after the date of death, unless
earlier terminated by lapse of time as provided in Subsection 2 of
Section 2.
F. Death or Disability of Optionee. Any such option
granted hereunder may be exercised by the optionee's guardian in
the case of a disabled optionee, or by the executors or
administrators of the optionee's estate or by any person or persons
who shall have acquired the option directly from the optionee by
his will or the applicable law of descent and distribution.
SECTION 3
RECAPITALIZATIONS AND REORGANIZATIONS
The number of shares of Common Stock covered by the Plan, the
number of shares and price per share of each outstanding option,
and the number of shares subject to each grant provided for in
Section 1 hereof shall be proportionately adjusted for any increase
or decrease in the number of issued and outstanding shares of
Common Stock resulting from a subdivision or consolidation of
shares or the payment of a stock dividend or any other increase or
decrease in the number of issued and outstanding shares of Common
Stock effected without receipt of consideration by the Company.
If the Company shall be the surviving corporation in any
merger or consolidation, each outstanding option shall pertain to
and apply to the securities to which a holder of the same number of
shares of Common Stock that are subject to that option would have
been entitled. A dissolution or liquidation of the Company, or a
merger or consolidation in which the Company is not the surviving
corporation, shall cause each outstanding option to terminate,
unless the agreement of merger or consolidation shall otherwise
provide; provided that, in the event such dissolution, liquidation,
merger or consolidation will cause outstanding options to
terminate, optionee shall have the right immediately prior to such
dissolution, liquidation, merger or consolidation to exercise his
option in whole or in part without regard to any limitations on the
exercisability of such option other than the expiration date of the
option.
To the extent that the foregoing adjustments relate to stock
or securities of the Company, such adjustments shall be made by the
Board, whose determination in that respect shall be final, binding
and conclusive.
SECTION 4
MISCELLANEOUS PROVISIONS
1. RIGHTS AS A SHAREHOLDER. An optionee or a transferee of
an option as such shall have no rights as a shareholder with
respect to any shares covered by an option until the date of the
receipt of payment (including any amounts required by the Company
pursuant to Subsection 8 of Section 1) by the Company.
2. PURCHASE FOR INVESTMENT. Unless the shares of Common
Stock to be issued upon exercise of an option granted under the
Plan have been effectively registered under the Securities Act of
1933, as amended (the "Securities Act"), the Company shall be under
no obligation to issue any shares of Common Stock covered by any
option unless the person who exercises such option, in whole or in
part, shall give a written representation and undertaking to the
Company which is satisfactory in
form and scope to counsel to the Company and upon which, in the opinion
of such counsel, the Company may reasonably rely, that he is acquiring
the shares of Common Stock issued to him pursuant to such exercise of
the option for his own account as an investment and not with a view to,
or for sale in connection with, the distribution of any such shares of
Common Stock, and that he will make no transfer of the same except in
compliance with any rules and regulations in force at the time of
such transfer under the Securities Act, or any other applicable
law, and that if shares of Common Stock are issued without such
registration, a legend to this effect may be endorsed upon the
securities so issued.
3. OTHER PROVISIONS. The option agreements authorized under
the Plan shall contain such other provisions, including, without
limitation, restrictions upon the exercise of the option or
restrictions required by any applicable securities laws, as the
Board shall deem advisable.
4. APPLICATION OF FUNDS. The proceeds received by the
Company from the sale of Common Stock pursuant to the exercise of
options will be used for general corporate purposes.
5. NO OBLIGATION TO EXERCISE OPTION. The granting of an
option shall impose no obligation upon the optionee to exercise
such option.
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I, Will Garrison, Secretary of American Freightways
Corporation, certify that the foregoing is a true and correct copy
of the American Freightways Corporation Amended and Restated
Appointed Non-Employee Director Stock Option Plan as adopted by the
Board of Directors of the corporation on July 15, 1998.
/s/Will Garrison