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EXHIBIT 10.4
CALIBER SYSTEM, INC.
1994 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 Award Date means the date of the Annual Meeting as of
which an award and grant under the Plan is effective.
2.3 Board means the Board of Directors of the Company.
2.4 Company means Caliber System, Inc., an Ohio
corporation, and any successor thereto.
2.5 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.
2.6 Nonemployee Director means a member of the Board
who is not employed by the Company or any of its subsidiaries.
2.7 Option Right means the right to purchase Shares
granted pursuant to Article IV.
2.8 Restricted Stock means Shares awarded pursuant to Article
IV which are neither nonforfeitable nor transferable pursuant to Articles V and
VI.
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2.9 Shares means shares of common stock, without par
value, of the Company.
ARTICLE III
SHARES AVAILABLE FOR GRANTS
Subject to adjustment as provided in Section 8.4, the Shares which may
be sold upon the exercise of Option Rights, or awarded as Restricted Stock and
released from restrictions upon becoming nonforfeitable and transferable, shall
not exceed in the aggregate 80,000 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, provided that Shares of Restricted Stock shall not become so
available if any dividends have been paid thereon prior to such reacquisition.
ARTICLE IV
AWARDS OF RESTRICTED STOCK
IN TANDEM WITH GRANTS OF OPTION RIGHTS
4.1 Awards and Grants. Each Nonemployee Director elected or
reelected to the Board at the 1994 Annual Meeting shall be awarded, effective as
of the date of such meeting, Restricted Stock having a Fair Market Value on the
Award Date of One Hundred Twenty-Five Thousand Dollars ($125,000), 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 1994 Annual Meeting shall be awarded, effective as of
the date of such meeting, Restricted Stock having a Fair Market Value on the
Award Date of One Hundred Twenty-Five Thousand Dollars ($125,000), 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.
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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:
(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
Award Date, 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 Award Date, 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 Award Date, 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 Award Date, 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 Award
Date, 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 Award
Date, 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 the death or disability of a Nonemployee
Director while he or she remains a director prior to the date of the
fifth Annual Meeting following his or her Award Date, notwithstanding
anything to the contrary
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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 than or equal to one hundred
thirty-three and one-third percent (133 1/3%) of its Fair Market Value
on the Award Date, 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 Award Date, 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 this paragraph (c),
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.
(d) In the event of the retirement of a Nonemployee Director
pursuant to the Company's director tenure policy prior to the date of
the fifth Annual Meeting following his or her Award Date,
notwithstanding anything to the contrary contained herein, the schedule
of nonforfeitability set forth in paragraph (a) and paragraph (b) of
this Article V shall be modified so that outstanding Shares of
Restricted Stock theretofore awarded to him or her that have not yet
become non-forfeitable shall thereupon become non- forfeitable on a
schedule that is one year earlier than provided in such paragraphs (a)
and (b) so that forty percent (40%) of the total number of Shares of
Restricted Stock shall become non-forfeitable on the date of the first
Annual Meeting following the Award Date as provided in paragraph (a) if
such First Annual Meeting has not yet occurred, and twenty percent
(20%) of the total number of Shares of Restricted Stock shall become
non-forfeitable on the dates of each of the second, third and fourth
Annual Meetings following the Award Date as provided in such paragraph
(b), provided that on the Determination Date (as hereinafter defined)
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 Award Date, and in such event all Option Rights
granted in tandem with such Shares of Restricted Stock 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 (133 1/3%) of its Fair Market Value on the Award Date, 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 Non-Employee Director
pursuant to the terms hereof
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and thereupon shall become exercisable. For purposes of this paragraph
(d), Determination Date shall mean the date service as a Director
terminates.
(e) Except as otherwise provided in paragraph (c) or paragraph
(d) above, should any Nonemployee Director cease to serve as such for
any reason prior to the date of the fifth Annual Meeting following his
or her Award Date, 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 a 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,
transferred (including, without limitation, transfer by gift or donation),
pledged or encumbered prior to the date, if any, on which they become
non-forfeitable 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 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 Award Date. 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
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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 Award Date or (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.
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, except as provided in Section 8.4, have any authority or discretion as to
the selection of persons eligible to participate in the Plan, the timing of
awards under 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.
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.
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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)
except as provided in Section 8.4, any amendment to the Plan that would have the
effect of changing the persons eligible to participate in the Plan, the timing
of awards under the Plan, 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. In no event shall the
provisions of the Plan relating to the matters set forth in clause (ii) of this
Section 9.1 be amended more than once every six months, other than to comport
with changes in the Internal Revenue Code.
9.2 Effective Date. The Plan shall be effective upon the later
of (i) its approval by the shareholders of the Company or (ii) the receipt by
the Company of such rulings, interpretive letters, legal opinions and other
professional advice as to the tax, securities and other legal ramifications of
the Plan as the Company shall deem necessary.
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
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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.
9.6 Rule 16b-3. This Plan is intended to comply with Rule
16b-3 under the Securities Exchange of 1934 as in effect prior to May 1, 1991.
The Board or the Committee may elect at any time to make Rule 16b-3 as in effect
on and after such date applicable to the Plan.
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