AMERICAN FREIGHTWAYS CORPORATION
AMENDED AND RESTATED
ELECTED NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
SECTION 1
1. This 1995 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.
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 elected a
director of the Company at its annual meeting of stockholders
shall automatically be granted options to purchase 6,000 shares
of the Company's common stock (subject to further adjustment as
provided herein) on the date such person is initially elected to
the Board (but not on subsequent election dates) and on each
succeeding first day in February (beginning February 1, 1998),
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.
The dates on which options are granted hereunder are
referred to herein as the "Grant Date." No person may receive
more than one option grant in any calendar year under the Plan.
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.
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 150,000 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, 2003. 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
Elected Non-Employee Director Stock Option Plan as adopted by the
Board of Directors of the corporation on July 15, 1998.
/s/Will Garrison