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Exhibit 4
YELLOW CORPORATION
1997 STOCK OPTION PLAN
1. PURPOSE-
The Yellow Corporation 1997 Stock Option Plan is designed to enable
qualified executive, managerial, supervisory and professional personnel of
Yellow Corporation and its Subsidiaries to acquire or increase their ownership
of common stock of the Company on reasonable terms. The opportunity so
provided is intended to foster in participants a strong incentive to put forth
maximum effort for the continued success and growth of the Company and its
Subsidiaries, to aid in retaining individuals who put forth such efforts, and
to assist in attracting the best available individuals in the future.
2. DEFINITIONS
When used herein, the following terms shall have the meaning set forth
below:
2.1 "Award" shall mean an Option or SAR.
2.2 "Board" means the Board of Directors of Yellow Corporation.
2.3 "Committee" means the members of the Board's Compensation Committee
who are non-employee directors as defined in Rule 16b-3 of the Securities and
Exchange Commission as it exists on the effective date of the Plan or as
subsequently amended or interpreted and are "outside directors" within the
meaning of Section 162(m) of the Internal Revenue Code of 1986 and the
regulations thereunder.
2.4 "Company" means Yellow Corporation.
2.5 "IRC '86" means the Internal Revenue Code of 1986, as in effect as of
the effective date of the Plan or as thereafter amended, and applicable
regulations.
2.6 "Fair Market Value" means with respect to the Company's Shares the
closing price of the Shares as reported by NASDAQ or if the closing price is
not reported, the bid price of the Shares as reported by NASDAQ on the date on
which the value is to be determined or, if the stock did not trade on that
date, the next preceding date on which such stock traded.
2.7 "Grantee" means a person to whom an Award is made.
2.8 "Non-Qualified Stock Option" or "NQSO" means an Option awarded under
the Plan which by its terms and conditions is not, and is not intended to be,
an "Incentive Stock Option" as defined by IRC '86.
2.9 "Option " means the right to purchase, at a price, for a term, under
conditions, and for cash or other considerations fixed by the Committee in
accordance with the Plan, and subject to such other limitations and
restrictions as the Plan and the Committee impose, a number of shares specified
by the Committee.
2.10 "Plan" means the Company's 1997 Stock Option Plan.
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2.11 "SAR" means a right to surrender to the Company all or a portion of
an Option and to be paid therefor an amount, as determined by the Committee, no
greater than the excess, if any, of (i) the Fair Market Value, on the date such
right is exercised, of the Shares to which the Option or portion thereof
relates, over (ii) the aggregate option price of those Shares.
2.12 "Shares" means shares of the Company's common stock or, if by reason
of the adjustment provisions hereof any rights under an Award under the Plan
pertain to any other security, such other security.
2.13 "Subsidiary" means any business, whether or not incorporated, in
which the Company, at the time an Award is granted to an employee thereof, or
in other cases, at the time of reference, owns directly or indirectly not less
than 50% of the equity interest.
2.14 "Successor" means the legal representative of the estate of a
deceased Grantee or the person or persons who shall acquire the right to
exercise an Option or an SAR, by bequest or inheritance or by reason of the
death of the Grantee, as provided in accordance with Section 9 hereof.
2.15 "Term" means the period during which a particular Option or SAR may
be exercised.
2.16 "QDRO" means a qualified domestic relations order as defined by IRC
'86 or Title I of the Employee Retirement Income Security Act, or the rules
thereunder.
3. ADMINISTRATION OF THE PLAN
3.1 The Plan shall be administered by the Committee.
3.2 The Committee shall have plenary authority, subject to the provisions
of the Plan, to determine when and to whom Awards shall be granted, the Term of
each Award, the number of Shares covered by it, the participation by Grantee in
other plans, and any other terms or conditions of each such Award. The
Committee may grant such additional benefits in connection with any Award as it
deems appropriate. The number of Shares, the Term, the other terms and
conditions of a particular kind of Award and any additional benefits granted in
connection with any Award need not be the same, even as to Awards made at the
same time. The Committee's actions in making Awards and fixing their size,
Term and other terms and conditions and in granting any additional benefits in
connection with any Award shall be conclusive on all persons.
3.3 The Committee shall have the sole responsibility for construing and
interpreting the Plan, for establishing and amending such rules and regulations
as it deems necessary or desirable for the proper administration of the Plan,
and for resolving all questions arising under the Plan. Any decision or action
taken by the Committee arising out of or in connection with the construction,
administration, interpretation and effect of the Plan and of its rules and
regulations shall, to the extent permitted by law, be within its absolute
discretion, except as otherwise specifically provided herein, and shall be
conclusive and binding upon all Grantees, all Successors, and any other
persons, whether that person is claiming under or through any Grantee or
otherwise.
3.4 The Committee shall regularly inform the Board as to its actions with
respect to all Awards under the Plan and the Terms and conditions of such
Awards in a manner, at such times, and in such form as the Board may reasonably
request.
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4. ELIGIBILITY
Awards may be made under the Plan only to employees of the Company or a
Subsidiary who have executive, managerial, supervisory or professional
responsibilities. Officers shall be employees for this purpose, whether or not
they are also Directors, but a Director who is not such an employee shall not
be eligible to receive an Award. Awards may be made to eligible employees
whether or not they have received prior Awards, under the Plan or under any
previously adopted plan, and whether or not they are participants in other
benefit plans of the Company. In making a determination concerning the
granting of Awards to eligible employees, the Committee may take into account
the nature of the services they have rendered or that the Committee expects
they will render, their present and potential contributions to the success of
the business, the number of years of effective service they are expected to
have and such other factors as the Committee in its sole discretion shall deem
relevant.
5. SHARES SUBJECT TO PLAN
Subject to adjustment as provided in Section 18 below, 1,400,000 Shares
are hereby reserved for issuance in connection with Awards under the Plan. The
Shares so issued may be unreserved Shares held in the treasury however acquired
or Shares which are authorized but unissued. Any Shares subject to issuance
upon exercise of Options shall once again be available for issuance in
satisfaction of Awards to the extent that (i) cash is issued in satisfaction of
the exercise of such Shares or (ii) the Option expires or terminates
unexercised as to any Shares covered thereby. Subject to adjustment as
provided in Section 18 below, the maximum number of Shares with respect to
which options or SARs may be granted during any calendar year to any employee
under the Plan shall be 200,000 Shares.
6. GRANTING OF OPTIONS
6.1 Subject to the terms of the Plan, the Committee may from time to time
grant Options to eligible employees.
6.2 The purchase price of each Share subject to Option shall be fixed by
the Committee, but shall not be less than 100% of the Fair Market Value of the
Share on the last business day prior to the date the Option is granted.
6.3 Each Option shall expire and all right to purchase Shares thereunder
shall cease on the date fixed by the Committee, which subject to the terms of
the Plan, shall not be later than the tenth anniversary of the grant date of
the Option.
6.4 Each Option shall become exercisable at the time, and for the number
of Shares, fixed by the Committee. Except to the extent otherwise provided in
or pursuant to Sections 9 and 10, no Option shall become exercisable as to any
Shares prior to the first anniversary of the date on which the Option was
granted.
7. STOCK APPRECIATION RIGHTS
7.1 The Committee may, in its discretion, grant an SAR to the holder of an
Option, either at the time the Option is granted or by amending the instrument
evidencing the grant of the Option at any time after the Option is granted and
more than six months before the end of the Term of the Option, so long as the
grant is made during the period in which grants of SARs may be made under the
Plan.
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7.2 Each SAR shall be for such Term, and shall be subject to such other
terms and conditions, as the Committee shall impose. The terms and conditions
may include Committee approval of the exercise of the SAR, limitations on the
time within which and the extent to which such SAR shall be exercisable,
limitations on the amount of appreciation which may be recognized with regard
to such SAR, and specification of what portion, if any, of the amount payable
to the Grantee upon his exercise of an SAR shall be paid in cash and what
portion, if any, shall be payable in Shares. If and to the extent that Shares
are issued in satisfaction of amounts payable on exercise of an SAR, the Shares
shall be valued at their Fair Market Value on the date of exercise.
7.3 Except to the extent otherwise provided in or pursuant to Sections 9
and 10, no SAR shall be exercisable during the first six months after its date
of grant.
7.4 Upon exercise of an SAR the Option, or portion thereof, with respect
to which such right is exercised shall be surrendered and shall not thereafter
be exercisable.
8. NON-TRANSFERABILITY OF RIGHTS
No rights under any Award shall be transferable otherwise than by will or
the laws of descent and distribution or pursuant to a QDRO, and the rights, and
except to the extent otherwise provided in Section 12, the benefits, of any
such Award may be exercised and received, respectively, during the lifetime of
the Grantee only by him or by his guardian or legal representative or by an
"alternate payee" pursuant to a QDRO.
9. DEATH OR TERMINATION OF EMPLOYMENT
9.1 Subject to the provisions of the Plan, the Committee may make such
provisions concerning exercise or lapse of Options or SARs on death or
termination of employment as it shall in its discretion determine. No such
provision shall extend the Term of an Option or SAR, nor shall any such
provision permit an Option or SAR to be exercised prior to six months after the
date on which it was granted, except in the event of death or termination by
reason of disability.
9.2 Transfers of employment between the Company and a Subsidiary, or
between Subsidiaries, shall not constitute termination of employment for
purposes of any Award. The Committee may specify in the terms and conditions
of an Award whether any authorized leave of absence or absence for military or
government service or for any other reason shall constitute a termination of
employment for purposes of the Award and the Plan.
10. PROVISIONS RELATING TO TERMINATION OF THE COMPANY'S SEPARATE EXISTENCE
The Committee may provide that in the event that the Company is to be
wholly or partly liquidated, or agrees to participate in a merger,
consolidation or reorganization in which it, or an entity controlled by it, is
not the surviving entity, any or all Options and SARs granted under the Plan
shall be immediately exercisable in full.
11. WRITINGS EVIDENCING AWARDS
Each Award granted under the Plan shall be evidenced by a writing which
may, but need not, be in the form of an agreement to be signed by the Grantee.
The writing shall set forth the nature and size of the Award, its Term, the
other terms and conditions thereof, other than those set forth in the Plan, and
such other information as the Committee directs. Acceptance of any benefits of
an Award by the Grantee shall be con-
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clusively presumed to be an assent to the terms and conditions set forth
therein, whether or not the writing is in the form of an agreement to be signed
by the Grantee.
12. EXERCISE OF RIGHTS UNDER AWARDS
12.1 A person entitled to exercise an Option or SAR may do so by delivery
of a written notice to that effect specifying the number of Shares with respect
to which the Option or SAR is being exercised and any other information the
Committee may prescribe.
12.2 The notice shall be accompanied by payment in full for the purchase
price of any Shares to be purchased with such payment being made in cash;
shares of the Company's common stock having a Fair Market Value equivalent to
the purchase price of such Shares; a combination thereof; or cashless exercise
pursuant to the Cashless Exercise Program offered by the Company. No Shares
shall be issued upon exercise of an Option until full payment has been made
therefor.
12.3 The notice of exercise of an SAR shall be accompanied by the
Grantee's copy of the writing or writings evidencing the grant of the SAR and
the related Option.
12.4 Upon exercise of an Option or SAR, the Grantee may request in writing
that the Shares to be issued in satisfaction of the Award be issued in the name
of the Grantee and another person as joint tenants with right of survivorship
or as tenants in common.
12.5 All notices or requests provided for herein shall be delivered to the
Secretary of the Company.
13. EFFECTIVE DATE OF THE PLAN AND DURATION.
13.1 The Plan shall become effective on July 15, 1997, subject to
stockholder approval at the 1998 Annual Meeting of Stockholders of the Company
where such approval is required by applicable SEC or stock market regulations.
13.2 No Awards may be granted under the Plan on or after July 16, 2007
although the terms of any Award may be amended at any time prior to the end of
its Term in accordance with the Plan.
14. DATE OF AWARD
The date of an Award shall be the date on which the Committee's
determination to grant the same is final, or such later date as shall be
specified by the Committee in connection with its determination.
15. STOCKHOLDER STATUS
No person shall have any rights as a stockholder by virtue of the grant of
an Award under the Plan except with respect to Shares actually issued to that
person.
16. POSTPONEMENT OF EXERCISE
The Committee may postpone any exercise of an Option or SAR for such time
as the Committee in its discretion may deem necessary in order to permit the
Company (i) to effect or maintain registration of the Plan or the Shares
issuable upon the exercise of an Option or an SAR under the Securities Act of
1933, as amended, or the securities laws of any applicable jurisdiction, (ii)
to permit any action to be taken in order to comply with restrictions or
regulations incident to the maintenance of a public market for its Shares, or
(iii) to
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determine that such Shares and the Plan are exempt from such registration or
that no action of the kind referred to in (ii) above needs to be taken; and
the Company shall not be obligated by virtue of any terms and conditions of any
Award or any provision of the Plan to recognize the exercise of an Option or an
SAR to sell or issue shares in violation of the Securities Act of 1933 or the
law of any government having jurisdiction thereof. Any such postponement shall
not extend the Term of an Option or SAR. Neither the Company nor its directors
or officers shall have any obligation or liability to the Grantee of an Award,
to the Grantee's Successor or to any other person with respect to any Shares as
to which the Option or SAR shall lapse because of such postponement.
17. TERMINATION, SUSPENSION OR MODIFICATION OF PLAN
The Board may at any time terminate, suspend or modify the Plan. However,
no termination, suspension or modification of the Plan shall adversely affect
any right acquired by any Grantee or any Successor under an Award granted
before the date of such termination, suspension or modification, unless such
Grantee or Successor shall consent; but it shall be conclusively presumed that
any adjustment for changes in capitalization as provided for herein does not
adversely affect any such right. Any member of the Board who is an officer or
employee of the Company or a Subsidiary shall be without vote on any proposed
amendment to the Plan, or on any other matter which might affect that member's
individual interest under the Plan.
18. ADJUSTMENT FOR CHANGES IN CAPITALIZATION
Any increase in the number of outstanding Shares of the Company occurring
through stock splits or stock dividends after the adoption of the Plan shall be
reflected proportionately in an increase in the aggregate number of Shares then
available for the grant of Awards under the Plan, or becoming available through
the termination, surrender or lapse of Awards previously granted but
unexercised, and in the number of Shares subject to Awards then outstanding;
and a proportionate reduction shall be made in the per share option price as to
any outstanding Options. Any fractional shares resulting from such adjustment
shall be eliminated. If changes in capitalization other than those considered
above shall occur, the Board shall make such adjustment in the number or class
of shares, remaining subject to Awards then outstanding and in the per share
option price as the Board in its discretion may consider appropriate to reflect
such change in capitalization, and all such adjustments shall9 be conclusive
upon all persons.
19. DELIVERY OR SHARES IN LIEU OF CASH INCENTIVE AWARDS
19.1 Any employee otherwise eligible for an Award under the Plan who is
eligible to receive a cash incentive payment from the Company under any
management incentive plan may make application to the Committee in such manner
as may be prescribed from time to time by the Committee, to receive Shares from
the Plan in lieu of all or any portion of such cash payment.
19.2 The Committee may in its discretion honor such application by
delivering Shares from the Plan to such employee equal in Fair Market Value to
that portion of the cash payment otherwise payable to the employee under such
incentive plan for which a Share delivery is to be made in lieu of cash
payment.
19.3 Any Shares delivered to employees under the Plan in lieu of cash
incentive payments shall come from the aggregate number of Shares authorized
for use by the Plan and shall not be available for any other Awards under the
Plan.
19.4 Such applications and such delivery of Shares shall not be permitted
on or after July 16, 2007.
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20. LOANS
20.1 The Company may make loans to Grantees for the sole purpose of
exercising Option Awards under the Plan and meeting the Federal tax
consequences of such exercise. Such loans shall be subject to the terms and
conditions established by the Committee from time to time which shall in all
cases include those specific items contained in this Section 20 as well as such
other items as may be established by the Committee.
20.2 No loan shall exceed the exercise price of the option to be exercised
plus the amount of Federal income taxes reasonably estimated to be due at the
exercise of the option or within the next following seven month period.
20.3 No loan shall have a term exceeding five years subject to renewal at
the discretion of the Committee. Notwithstanding any other terms of the loan,
each loan shall be fully due and payable on the loan recipient's termination of
employment, except that in the case of termination due to disability, the
Committee at its discretion may extend the terms of the loan beyond
termination.
20.4 Interest shall be charged on the loan with a rate established by the
Committee but in no case less than an amount equal to any dividends payable
during the term of the loan on the Shares being purchased by the Grantee at the
exercise of the Option. Such minimum interest rate shall be determined by
dividing the dividends paid on such Shares during the preceding twelve months
by the Option price for such Shares.
20.5 If such a loan is made to a Grantee, the Company shall not deliver a
certificate or any shares purchased with the loan proceeds, until such time as
the loan is repaid.
21. NO-UNIFORM DETERMINATION
The Committee's determination under the Plan including, without
limitation, determination of the persons to receive Awards, the form, amount
and type of Awards (e.g. NQSOs, SARs), the terms and provisions of Awards and
the written material evidencing such Awards, the grant of additional benefits
in connection with any Award, and the granting or rejecting of loans or
applications for delivery of stock in lieu of cash bonus or incentive payments
need not be uniform and may be made selectively among otherwise eligible
employees, whether or not such employees are similarly situated.
22. TAXES
The Company is authorized to pay or withhold the amount of any tax
attributable to any amounts payable under any Awards, and the Company may defer
making payment of any Award if any such tax, charge or assessment may be
pending until indemnification to its satisfaction. This authority shall
include authority to withhold or receive Shares and to make cash payments in
respect thereof in satisfaction of an individual's tax obligations.
23. TENURE
An employee's right, if any, to continue in the employ of the Company or a
Subsidiary shall not be affected by the fact that he is a participant under
this Plan. At the sole discretion of the Committee, an employee terminated for
cause may be required to forfeit all of his rights under the Plan, except as to
Options or SARs already exercised.
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24. APPLICATION OF PROCEEDS
The proceeds received by the Company from the sale of its Shares under the
Plan shall be used for general corporate purposes.
25. OTHER ACTIONS
Nothing in the Plan shall be construed to limit the authority of the
Company to exercise its corporate rights and powers, including, by way of
illustration and not by way of limitation, the right to grant options for
proper corporate purposes otherwise than under the Plan to any employee or any
other person, firm, corporation, association or other entity, or to grant
options to, or assume options of, any person in connection with the
acquisition, by purchase, lease, merger, consolidation or otherwise, of all or
any part of the business and assets of any person, firm, corporation,
association or other entity.
26. GOVERNING LAW
The Plan and all determinations made and actions taken pursuant hereto
shall be governed by and construed in accordance with the laws of the State of
Delaware.