Exhibit 10.1
AMERICAN FREIGHTWAYS CORPORATION
1999 CHAIRMAN STOCK OPTION PLAN
SECTION 1
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1. This 1999 Chairman Stock Option Plan (the "Plan") is
intended to attract and retain the services of an experienced and
knowledgeable chairman ("Chairman") of American Freightways
Corporation (the "Company"), for the benefit of the Company and its
shareholders and to provide additional incentive for such person to
continue to work for the best interests of the Company and its
shareholders.
2. ADMINISTRATION. The Board of Directors of the Company
(the "Board of Directors") hereby designates the Compensation
Committee (the "Committee") as the Committee of the Board of
Directors authorized to administer the Plan. The Committee shall
consist of no fewer than two members of the Board of Directors,
each of whom shall be a "disinterested person" within the meaning
of Rule 16b-3 (or any successor rule or regulation), promulgated
under the Securities Exchange Act of 1934, as amended. A majority
of the members of the Committee shall constitute a quorum, and the
act of a majority of the members of the Committee shall be the act
of the Committee. Any member of the Committee may be removed at
any time either with or without cause by resolution adopted by the
Board of Directors, and any vacancy on the Committee may at any
time be filled by resolution adopted by the Board of Directors.
The Committee 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 Committee of any
provisions of the Plan or of any option granted under it shall be
final. No member of the Committee 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. The person who has been duly elected and is
then serving as Chairman of the Board of the Company on each
January 1 hereafter shall automatically be granted options to
purchase such number of shares of the Company's Common Stock
(subject to further adjustment as provided in SECTION 3 hereof) as
follows: The Chairman shall be granted options to acquire the
number of shares set forth in Column B which correspond to the
percentage (set forth in Column A) by which the Company's net
income, after taxes, all as determined for financial accounting
reporting purposes ("Net Income"), for the most recently completed
fiscal year exceeded Net Income for the preceding fiscal year.
A B
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15 - 17.5% 10,000
17.6 - 20.0% 20,000
20.1 - 25.0% 30,000
25.1 - 29.0% 40,000
29.1 - and above 50,000
The dates on which options are granted hereunder are referred
to herein as the "Grant Date."
Unless a shorter vesting period is determined by the Committee
prior to or at the Grant Date, which determination shall not
require shareholder approval, all options granted to the Chairman
under this SECTION 3 shall vest at the rate of 20% per year
beginning on the first anniversary of the Grant Date.
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 to the Chairman shall not exceed 250,000 shares of Common
Stock, unless an adjustment is required in accordance with SECTION
3.
5. AMENDMENT OR TERMINATION OF THE PLAN. The Committee 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. APPROVAL OF SHAREHOLDERS. The Plan is effective April
15, 1999, subject to approval by the affirmative votes of the
holders of a majority of the securities of the Company present, or
represented, and entitled to vote at the next succeeding meeting of
shareholders, or any adjournment thereof, duly held in accordance
with Arkansas law. Notwithstanding any contrary provision of the
Plan, no option granted hereunder may become exercisable unless and
until such approval is obtained.
Options may be granted under the Plan until and including
January 1, 2004. 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. LIMITATION ON TRANSFERABILITY. Options are not
transferable by the grantee except by will or the laws of descent
and distribution and are exercisable during his lifetime only by
him; provided however, that the Committee shall have the authority,
in its discretion, to grant (or to sanction by way of amendment of
an existing grant) options which may be transferred by the grantee
during his lifetime to any member of his immediate family or to a
trust, limited liability company, family limited partnership or
other equivalent vehicle, established for the exclusive benefit of
grantee and/or one or more members of his immediate family. A
transfer of an option hereunder may only be effected by the Company
at the written request of the grantee and shall become effective
only when recorded in the Company's record of outstanding options.
In the event an option is transferred as contemplated herein, such
option shall continue to be governed by and subject to the terms
and limitations of the Plan and the relevant option agreement,
including limitations on subsequent transfers. As used herein,
"immediate family" shall mean, with respect to the grantee, the
grantee's spouse, and any child, stepchild or grandchild of the
grantee, and shall include relationships arising from legal
adoption.
8. WITHHOLDING TAXES. Whenever shares of Common Stock are
to be issued under the Plan, the Company shall 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
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STOCK OPTIONS
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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
Committee.
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 Committee 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. Options granted under the Plan
shall vest and become exercisable in 20% increments per year,
beginning on the first anniversary of the Grant Date of the Option;
provided however, that the Committee, prior to or on the Grant Date
of any option granted hereunder, in its discretion and without need
of shareholder approval, may determine and fix a shorter vesting
period for any such 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 Chairman Employment. In the event that an
optionee shall cease to be Chairman of the Company for any reason
other than his termination for cause, his option shall cease to
continue vesting, but vested and exercisable portions shall
continue to be exercisable to the extent it was exercisable at the
date he ceased to be Chairman, for the period specified in the
option agreement. In the event that an optionee ceases to be
Chairman due to his termination for cause, his option shall cease
to continue vesting but vested and exercisable portions shall
continue to be exercisable for 90 days following the date of his
termination, and thereafter shall terminate.
SECTION 3
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RECAPITALIZATIONS AND REORGANIZATIONS
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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
Committee, whose determination in that respect shall be final,
binding and conclusive.
SECTION 4
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MISCELLANEOUS PROVISIONS
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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
Committee 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.
IN WITNESS WHEREOF, AMERICAN FREIGHTWAYS CORPORATION, by its
duly authorized officer, has executed this Plan on the date
indicated below.
Dated April 15, 1999 By:/s/ Will Garrison
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Officer
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