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EXHIBIT 10.3
CALIBER SYSTEM, INC.
NONEMPLOYEE DIRECTORS' STOCK PLAN
(As Amended as of May 8, 1996)
ARTICLE I
PURPOSE
The purpose of the Caliber System, Inc. Nonemployee Directors' Stock
Plan (the Plan) is to continue to attract and retain nonemployee directors of
exceptional ability and to solidify the common interest of directors and
shareholders in enhancing the value of the Company's common stock.
ARTICLE II
DEFINITIONS
For purposes of the Plan, the following words and phrases shall have
the meanings indicated:
2.1 Annual Meeting means an annual meeting of
shareholders of the Company.
2.2 Board means the Board of Directors of the Company.
2.3 Company means Caliber System, Inc., an Ohio corporation,
and any successor thereto.
2.4 Fair Market Value means the average of the highest and
lowest sales prices of the Shares on a specified date (or, if Shares
were not traded on such day, the next preceding day on which Shares
were traded) as reported in The Wall Street Journal under the heading
"NASDAQ National Market Issues" or any similar or successor heading.
2.5 Nonemployee Director means a member of the Board who is
not employed by the Company or any of its subsidiaries.
2.6 Option Right means the right to purchase Shares granted
pursuant to Article IV.
2.7 Restricted Stock means Shares awarded pursuant to Article
IV which are neither non-forfeitable nor transferrable pursuant to
Articles V and VI.
2.8 Shares means shares of common stock, without par
value, of the Company.
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ARTICLE III
SHARES AVAILABLE FOR GRANTS
The Shares which may be sold upon the exercise of Option Rights, or
awarded as Restricted Stock and released from restrictions upon becoming
non-forfeitable and transferrable, shall not exceed in the aggregate 60,000
Shares. Shares which are subject to the unexercised portions of any Option
Rights that expire, terminate or are cancelled, and Shares of Restricted Stock
that are forfeited or otherwise reacquired by the Company pursuant to the
restrictions thereon, shall again become available for the award of Restricted
Stock and grant of Option Rights under the Plan.
ARTICLE IV
AWARDS OF RESTRICTED STOCK
IN TANDEM WITH GRANTS OF OPTION RIGHTS
4.1 Awards and Grants. Each Nonemployee Director elected or re-elected
to the Board at the 1989 Annual Meeting shall be awarded, effective as of the
date of such meeting, Restricted Stock having a Fair Market Value on such date
of Forty Thousand Dollars ($40,000), in tandem with a grant of Option Rights to
purchase that number of Shares as shall be equal to four (4) times the number of
Shares included in such award of Restricted Stock. Each Nonemployee Director
first elected to the Board at an Annual Meeting after the 1989 Annual Meeting
shall be awarded, effective as of the date of such meeting, Restricted Stock
having a Fair Market Value on such date of Forty Thousand Dollars ($40,000), in
tandem with a grant of Option Rights to purchase that number of Shares as shall
be equal to four (4) times the number of Shares included in such award of
Restricted Stock.
4.2 Execution of Agreement. Each award and grant hereunder shall be
contingent upon execution by the Nonemployee Director of a document agreeing to
the terms and conditions set forth in the Plan, and any other terms and
conditions required by the Company.
ARTICLE V
LAPSE OF RESTRICTIONS ON RESTRICTED
STOCK; EXERCISABILITY OF OPTION RIGHTS
Shares of Restricted Stock awarded under the Plan shall be forfeited or
become non-forfeitable, and Option Rights granted under the Plan shall be
cancelled or become exercisable, on the following basis:
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(a) Forty percent (40%) of the total number of Shares of
Restricted Stock awarded to any Nonemployee Director shall become
non-forfeitable on the date of the second Annual Meeting following the
date of such award, provided that on the date of such second Annual
Meeting the Fair Market Value of one Share shall be less than or equal
to one hundred thirty-three and one-third percent (133 1/3%) of its
Fair Market Value on the date of such award, and in such event the
Option Rights granted in tandem with such Shares of Restricted Stock
thereupon shall be cancelled. If on the date of such second Annual
Meeting the Fair Market Value of one Share is greater than one hundred
thirty-three and one-third percent (133 1/3%) of its Fair Market Value
on the date of such award, such Shares of Restricted Stock instead
shall be forfeited and shall revert to the Company, and the Option
Rights granted in tandem therewith shall continue to be held by such
Nonemployee Director pursuant to the terms hereof and thereupon shall
become exercisable.
(b) Twenty percent (20%) of the total number of Shares of
Restricted Stock awarded to any Nonemployee Director shall become
non-forfeitable on the dates of each of the third, fourth and fifth
Annual Meetings following the date of such award, provided that on the
date of such third, fourth or fifth Annual Meeting the Fair Market
Value of one Share shall be less than or equal to one hundred
thirty-three and one-third percent (133 1/3%) of its Fair Market Value
on the date of such award, and in such event the Option Rights granted
in tandem with such Shares of Restricted Stock thereupon shall be
cancelled. If on the date of such third, fourth or fifth Annual Meeting
the Fair Market Value of one Share is greater than one hundred
thirty-three and one-third percent (133 1/3%) of its Fair Market Value
on the date of such award, such Shares of Restricted Stock instead
shall be forfeited and shall revert to the Company, and the Option
Rights granted in tandem therewith shall continue to be held by such
Nonemployee Director pursuant to the terms hereof and thereupon shall
become exercisable.
(c) In the event of (i) the death or disability of a
Nonemployee Director while he or she remains a director, (ii) the
retirement of a Nonemployee Director pursuant to the Company's director
tenure policy or (iii) other termination of service of a Nonemployee
Director as a director of the Company with the consent of a majority of
the members of the Board who are not then participating in the Plan, in
each case prior to the date of the fifth Annual Meeting following the
date of an award in his or her name hereunder, notwithstanding anything
to the contrary contained herein all outstanding Shares of Restricted
Stock theretofore awarded to him or her that have not yet become
non-forfeitable shall thereupon become non-forfeitable, provided that
on the Determination Date (as hereinafter defined) the Fair Market
Value of one Share shall be less
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than or equal to one hundred thirty-three and one-third percent
(133 1/3%) of its Fair Market Value on the date of such award, and in
such event all Option Rights granted in tandem therewith thereupon
shall be cancelled. If on such Determination Date the Fair Market Value
of one Share is greater than one hundred thirty-three and one-third
percent (133 1/3%) of its Fair Market Value on the date of such award,
all such Shares of Restricted Stock instead shall be forfeited and
shall revert to the Company, and all Option Rights granted in tandem
therewith shall continue to be held by such Nonemployee Director or his
estate pursuant to the terms hereof and thereupon shall become
exercisable. For purposes of clause (i), Determination Date shall mean,
as applicable, the date of the Nonemployee Director's death or the date
on which the Nonemployee Director ceases to serve as a director of the
Company as a result of disability. For purposes of clauses (ii) and
(iii), Determination Date shall mean the date service as a director
terminates.
(d) Except as otherwise provided in paragraph (c) above,
should any Nonemployee Director cease to serve as such for any reason
prior to the date of the fifth Annual Meeting following the date of an
award in his or her name hereunder, all outstanding Shares of
Restricted Stock awarded to such Nonemployee Director that have not yet
become non-forfeitable shall be forfeited and shall revert to the
Company, and all Option Rights granted in tandem therewith shall be
cancelled, on the day following the date on which such service ceases.
ARTICLE VI
TERMS AND CONDITIONS OF AWARDS OF RESTRICTED STOCK
6.1 Rights as Shareholder. Each award of Restricted Stock under the
Plan shall constitute an immediate transfer of the ownership of Shares to the
Nonemployee Director in consideration of the performance of services, entitling
such Nonemployee Director to voting, dividend and other ownership rights, but
subject to the forfeiture and transfer restrictions provided herein. No
additional consideration shall be due in connection with any such award.
6.2 Transfer Restrictions. Shares of Restricted Stock awarded pursuant
to the Plan which have not yet become non-forfeitable may not be sold or
transferred (including without limitation, transfer by gift or donation) prior
to the date, if any, on which they become non-forfeitabIe and shall bear
appropriate legends.
6.3 Additional Securities. Any new or additional Shares or
other securities to which a Nonemployee Director, by virtue of
awards of Restricted Stock hereunder, becomes entitled due to a
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stock dividend, stock split, recapitalization, merger or other event shall be
subject to all terms and conditions of the Plan, including this Article VI.
ARTICLE VII
TERMS AND CONDITIONS OF GRANTS OF OPTION RIGHTS
7.1 Option Price. The option price per share of each Share included in
a grant of Option Rights shall be the Fair Market Value of such Share as of the
effective date of such grant. Such option price shall be payable by check, by
transfer to the Company of Shares (not subject to restrictions pursuant to
Article VI) having a Fair Market Value equal, at the time of exercise of the
Option Right, to the option price or by a combination of such methods of
payment.
7.2 Expiration of Option Rights; Transfer Restrictions. Option Rights
granted to a Nonemployee Director under the Plan which become exercisable
pursuant to Article V shall expire upon the earlier of the following: (i) ten
(10) years after the date of grant and (ii) three (3) months after the director
ceases to serve as such for reasons other than death, disability, retirement as
a director pursuant to the Company's director tenure policy, or other
termination of service as a director of the Company with the consent of a
majority of the members of the Board who are not then participating in the Plan.
Option Rights granted to a Nonemployee Director pursuant to the Plan in no event
shall be sold or transferred other than by will or the laws of descent and
distribution. Option Rights are exercisable during the Nonemployee Director's
lifetime only by him or her or his or her legal representative.
ARTICLE VIII
ADMINISTRATION
8.1 Committee; Duties. The administrative committee for the Plan (the
Committee) shall consist of the Chairman of the Board (provided that he is not a
Nonemployee Director) and two Company officers or directors who are not
Nonemployee Directors who shall be appointed by the Chairman of the Board to
serve on the Committee. The Committee shall supervise the administration of the
Plan, may from time to time adopt procedures governing the Plan and shall have
authority to give interpretive rulings with respect to the Plan, provided that
the Committee shall not have any authority or discretion as to the selection of
persons eligible to participate in the Plan, the number of Shares to be included
in awards of Restricted Stock or to be subject to Option Rights or the purchase
price for any such Shares.
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8.2 Agents. The Committee may appoint an individual, who may be an
employee of the Company, to be the Committee's agent with respect to the
day-to-day administration of the Plan. In addition, the Committee may, from time
to time, employ other agents and delegate to them such administrative duties as
it sees fit, and may from time to time consult with counsel who may be counsel
to the Company.
8.3 Binding Effect of Decisions. Any decision or action of the
Committee with respect to any question arising out of or in connection with the
administration, interpretation or application of the Plan shall be final and
binding upon all persons having any interest in the Plan.
8.4 Adjustments. In the event of (a) any stock dividend, stock split,
combination of shares, recapitalization or other change in the capital structure
of the Company, (b) any merger, consolidation, separation, reorganization,
partial or complete liquidation, issuance of rights or warrants to purchase
stock or (c) any other corporate transaction or event having an effect similar
to any of the foregoing, the Committee shall make or provide for such
adjustments in (i) the number or kind of Shares or other securities of the
Company available for grants under Article III, (ii) the kind of securities of
the Company to be covered by awards of Restricted Stock, (iii) the option price
and the number or kind of Shares or other securities of the Company covered by
outstanding Option Rights and (iv) such other matters as the Committee may
determine is equitably required to prevent dilution or enlargement of the rights
of participants in the Plan.
ARTICLE IX
MISCELLANEOUS
9.1 Amendment. The Board may at any time amend, suspend or terminate
any or all of the provisions of the Plan, except that (i) no such amendment,
suspension or termination shall adversely affect any Restricted Stock or Option
Rights theretofore awarded or granted under the Plan to any Nonemployee Director
without the written consent of such director and (ii) any amendment to the Plan
that would have the effect of changing the persons eligible to participate in
the Plan or the number of Shares to be awarded or granted to participants under
the Plan or the purchase price thereof shall be approved by the shareholders of
the Company prior to effectiveness.
9.2 Effective Date. The Plan shall be effective upon its
approval by the shareholders of the Company.
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9.3 Governing Law. The provisions of the Plan shall be
construed and interpreted according to the laws of the State of Ohio.
9.4 Successors. The provisions of the Plan shall bind and inure to the
benefit of the Company and its successors and assigns. The term successors as
used herein shall include any corporate or other business entity which shall,
whether by merger, consolidation, purchase or otherwise, acquire all or
substantially all of the business and assets of the Company and successors of
any such corporation or other business entity.
9.5 Right to Continued Service. Nothing contained herein
shall be construed to confer upon any director the right to
continue to serve as a director of the Company or in any other
capacity.
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