SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Consolidated Freightways Corporation
(Exact name of registrant as specified in its charter)
Delaware 77-0425334
(State of Incorporation) (I.R.S. Employer Identification No.)
175 Linfield Drive
Menlo Park, California 94025
(Address of principal executive offices)
Safety Award Plan
1999 Equity Incentive Plan
1999 Non-Employee Directors' Stock Option Plan
(Full title of the plans)
Stephen D. Richards, Esq.
Consolidated Freightways Corporation
175 Linfield Drive
Menlo Park, California 94025
(650) 326-1700
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
Copies to:
Stephen W. Fackler, Esq.
Cooley Godward LLP
Five Palo Alto Square, 3000 El Camino Real
Palo Alto, California 94306-2155
(650) 843-5000
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Amount to Maximum Maximum Amount of
Securities be Offering Aggregate Registration
to be Registered Price Per Offering Fee
Registered Share (1) Price (1)
Common Stock
(par value 2,400,000 $11.25- $29,437,015.63 $8,183.49
$0.01) 14.0625
(1) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rules 457(c) and 457(h)(1). The price
per share and aggregate offering price are based upon (a) the weighted
average exercise price for shares subject to options previously
granted under the Registrant's 1999 Equity Incentive Plan and 1999 Non-
Employee Directors' Stock Option Plan, pursuant to Rule 457(h)(1)
under the Securities Act of 1933, as amended (the "Securities Act"),
and (b) for shares reserved for future issuance pursuant to the
Registrant's Safety Award Plan, 1999 Equity Incentive Plan and 1999
Non-Employee Directors' Stock Option Plan, the average of the high and
low prices of the Registrant's Common Stock on August 13, 1999, as
reported on The Nasdaq National Market (National Market).
NOTES TO CALCULATION OF REGISTRATION FEE
The chart below details the calculations of the registration fee:
Type of Shares Number of Offering Aggregate
Shares Price Per Offering
Share Price
Shares issuable 742,050 $ 14.0625 (1)(a) $10,435,078.13
pursuant to
outstanding options
under the 1999
Equity Incentive
Plan
Shares issuable 200,000 $ 13.00 (1)(a) $ 2,600,000.00
pursuant to
outstanding options
under the 1999 Non-
Employee Directors'
Stock Option Plan
Shares reserved for 150,000 $ 11.25 (1)(b) $ 1,687,500.00
future issuance
pursuant to the
Safety Award Plan
Shares reserved for 1,257,950 $ 11.25 (1)(b) $14,151,937.50
future issuance
pursuant to the
1999 Equity
Incentive Plan
Shares reserved for 50,000 $ 11.25 (1)(b) $ 562,500.00
future issuance
pursuant to the 1999
Non-Employee Directors'
Stock Option Plan
Proposed Maximum $29,437,015.63
Offering Price
Registration Fee $ 8,183.49
Part II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by Consolidated Freightways
Corporation (the "Company") with the Securities and Exchange
Commission are incorporated by reference into this Registration
Statement:
(a) The Company's latest annual report on Form 10-K filed
pursuant to Sections 13(a) or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), or the Company's
latest prospectus filed pursuant to Rule 424(b) under the
Securities Act, that contains audited financial statements for
the Company's latest fiscal year for which such statements have
been filed.
(b) All other reports filed pursuant to Sections 13(a) or 15(d)
of the Exchange Act since the end of the fiscal year covered by
the annual reports or the prospectus referred to in (a) above.
(c) The description of the Company's Common Stock which is
contained in a registration statement filed under the Exchange
Act, including any amendment or report filed for the purpose of
updating such description.
All reports and other documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or
which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be a part of
this registration statement from the date of the filing of such
reports and documents.
Item 4. DESCRIPTION OF SECURITIES
Not Applicable.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Stephen D. Richards, Senior Vice President and General
Counsel of the Company, is providing the required opinion
regarding the legality of the securities being registered (see
Exhibit 5.1 to this Registration Statement). Mr. Richards owns
129,885 shares of the Company's common stock and options to
purchase an additional 42,000 shares of the Company's common
stock. Mr. Richards is eligible to receive awards under the 1999
Equity Incentive Plan.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Limitation of Liability
Section 102(b)(7) of the Delaware General Corporation Law (the
"DGCL") permits a corporation's certificate of incorporation to
include a provision eliminating or limiting the personal
liability of a director to the corporation or its stockholders
for monetary damages for breach of fiduciary duty as a director
provided that such provision shall not eliminate or limit the
liability of a director (i) for any breach of the director's duty
of loyalty to the corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174
of the DGCL (relating to unlawful payment of dividends and
unlawful stock purchase and redemption) or (iv) for any
transaction from which the director derived an improper personal
benefit. As permitted by Section 102(b)(7) of the DGCL, the
Company's Certificate of Incorporation, as amended, provides that
the Company's directors shall not be liable to the Company or its
stockholders for monetary damages for breach of fiduciary duty as
a director, except to the extent that exculpation from
liabilities is not permitted under the DGCL as in effect at the
time such liability is determined.
Indemnification and Insurance
The Company's Certificate of Incorporation, as amended, and
Bylaws, as amended, provide that the Company shall indemnify its
directors and officers to the full extent permitted by the law of
the State of Delaware. Section 145 of the DGCL provides that a
corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal or
investigative (other than an action by or in the right of the
corporation) by reason of the fact that he or she is or was a
director, officer, employee or agent of the corporation or is or
was serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him or her in
connection with such action, suit or proceeding if he or she
acted in good faith and in a manner he or she reasonably believed
to be in or not opposed to the best interests of the corporation,
and with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful.
Section 145 further provides that a corporation similarly may
indemnify any such person serving in any such capacity who was or
is a party or is threatened to be made by a party to any
threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor,
against expenses (including attorneys' fees) actually and
reasonably incurred in connection with the defense or settlement
of such action or suit if he or she acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to
the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the
Delaware Court of Chancery or such other court in which such
action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of
Chancery or such other court shall deem proper.
The Company has obtained an insurance policy that insures its
directors and officers against certain liabilities.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
Item 8. EXHIBITS
Exhibit
Number
4.1 Amended and Restated Certificate of Incorporation of
the Company. (1)
4.2 Amended and Restated Bylaws of the Company. (2)
4.3 Safety Award Plan.
4.4 1999 Equity Incentive Plan and forms of stock option
agreements for both officers and management. (3)
4.5 Form of Restricted Stock Award and Deferral Agreement under
1999 Equity Incentive Plan.
4.6 1999 Non-Employee Directors' Stock Option Plan and form
of stock option agreement. (4)
5.1 Opinion of Counsel of Consolidated Freightways
Corporation.
23.1 Consent of Arthur Andersen LLP, independent public
accountants.
23.2 Consent of Counsel for Consolidated Freightways
Corporation (included in Exhibit 5.1).
24 Power of Attorney is contained on the signature pages.
(1) Document incorporated by reference to Exhibit 4.1 to the
Company's Registration Statement on Form S-8 dated November 26,
1996, File No. 333-16851.
(2) Document incorporated by reference to Exhibit 3.2 to the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998.
(3) Documents incorporated by reference to Exhibit 10.3 to the
Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1999.
(4) Documents incorporated by reference to Exhibit 10.4 to the
Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1999.
Item 9. UNDERTAKINGS
1. The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs (a)(i) and (a)(ii) do not
apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic
reports filed by the issuer pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by
reference herein.
(b) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(c) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
2. The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
3. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in
the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
as amended, the Registrant certifies that it has reasonable
grounds to believe that it meets all of the requirements for
filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Menlo Park, State of
California, on August 17, 1999.
CONSOLIDATED FREIGHTWAYS CORPORATION
By /s/ W. Roger Curry
W. Roger Curry
President and Chief
Executive Officer
(Principal Executive
Officer)
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Stephen D.
Richards, his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and
all amendments (including post-effective amendments) to this
Registration Statement, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-
in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and
necessary to be done in connection therewith, as fully to all
intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their or his substitutes or
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
as amended, this Registration Statement has been signed by the
following persons in the capacities and on the dates indicated.
Signature Title Date
/s/ W. Roger Curry President and Chief August 17, 1999
W. Roger Curry Executive Officer,
Director
(Principal Executive
Officer)
/s/ Sunil Bhardwaj Senior Vice August 17, 1999
Sunil Bhardwaj President and Chief
Financial Officer
(Principal Financial
Officer)
/s/ Robert E. Wrightson Senior Vice August 17, 1999
Robert E. Wrightson President and
Controller
(Principal
Accounting Officer)
/s/ William D. Walsh Chairman of the August 17, 1999
William D. Walsh Board
/s/ G. Robert Evans Director August 17, 1999
G. Robert Evans
/s/ Paul B. Guenther Director August 17, 1999
Paul B. Guenther
Director August ___, 1999
Robert W. Hatch
/s/ John M. Lillie Director August 17, 1999
John M. Lillie
/s/ James B. Malloy Director August 17, 1999
James B. Malloy
Director August ___, 1999
Raymond F. O'Brien
EXHIBIT INDEX
Exhibit Description
Number
4.1 Amended and Restated Certificate of Incorporation of
the Company. (1)
4.2 Amended and Restated Bylaws of the Company. (2)
4.3 Safety Award Plan.
4.4 1999 Equity Incentive Plan and forms of stock option
agreements for both officers and management. (3)
4.5 Form of Restricted Stock Award and Deferral Agreement under
1999 Equity Incentive Plan.
4.6 1999 Non-Employee Directors' Stock Option Plan and form
of stock option agreement. (4)
5.1 Opinion of Counsel of Consolidated Freightways
Corporation.
23.1 Consent of Arthur Andersen LLP, independent public
accountants.
23.2 Consent of Counsel for Consolidated Freightways
Corporation (included in Exhibit 5.1).
24 Power of Attorney is contained on the signature pages.
(1) Document incorporated by reference to Exhibit 4.1 to the
Company's Registration Statement on Form S-8 dated November 26,
1996, File No. 333-16851.
(2) Document incorporated by reference to Exhibit 3.2 to the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998.
(3) Documents incorporated by reference to Exhibit 10.3 to the
Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1999.
(4) Documents incorporated by reference to Exhibit 10.4 to the
Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1999.
Exhibit 4.3
CONSOLIDATED FREIGHTWAYS CORPORATION
SAFETY AWARD PLAN
1. Introduction.
The Consolidated Freightways Corporation Safety Award Plan
(the "Plan") was established effective August 17, 1999. The
purpose of the Plan is to provide eligible employees of
Consolidated Freightways Corporation and its subsidiaries (the
"Company") with certain awards for safe driving and contributing
to a safe working environment.
2. Eligibility; Type of awards.
(a) Safe Working Awards. Employees of the Company who are
assigned certain non-driving positions with the Company are
eligible to earn safety achievement awards as described in
Appendix A. Eligibility, types of awards, length of service
achievement required to receive such awards, and the timing of
awards are described in Appendix A.
(b) Safe Driving Awards. Employees of the Company who are
assigned to driving positions with the Company are eligible to
earn safety achievement awards as described in Appendix B.
Eligibility, types of awards, length of service achievement
required to receive such awards, and the timing of awards are
described in Appendix B.
3. Safety Awards.
Safety achievement awards under the Plan shall consist of
various non-cash items of value and Company common stock, as
described in Appendices A and B. Company common stock that may
be issued pursuant to safety achievement awards shall not exceed
in the aggregate one hundred fifty thousand (150,000) shares.
4. Right To Interpret Plan; Amend and Terminate;
Termination Date Of Plan.
(a) Exclusive Discretion. The Plan Administrator shall have the
exclusive discretion and authority to establish rules, forms, and
procedures for the administration of the Plan, and to construe
and interpret the Plan and to decide any and all questions of
fact, interpretation, definition, computation or administration
arising in connection with the operation of the Plan, including,
but not limited to, the eligibility to participate in the Plan
and awards granted under the Plan. The rules, interpretations,
computations and other actions of the Plan Administrator shall be
binding and conclusive on all persons.
(b) Amendment Or Termination. While the Company intends and
expects the Plan to continue to fulfill its purposes and serve
the best interests of the Company in its present form, the
Company reserves the right to amend or discontinue this Plan or
the benefits provided hereunder at any time; provided, however,
that no such amendment or termination shall affect the right to
any award earned by an eligible employee prior to amendment or
termination of the Plan.
(c) Plan Termination Date. Unless sooner terminated, the Plan
shall not terminate prior to the date that all shares of Company
common stock reserved for issuance under the Plan have been
issued.
5. Legal Construction.
It is intended that safety achievement awards under the Plan
be "employee achievement awards" within the meaning of Section
274(j) of the Internal Revenue Code to the maximum extent
permitted thereunder for purposes of tax deductibility for the
cost of each such award. The Plan is not subject to any
provisions of the Employee Retirement Income Security Act of
1974, as amended.
6. No Implied Employment Contract.
The Plan shall not be deemed (i) to give any employee or
other person any right to be retained in the employ of the
Company nor (ii) to interfere with the right of the Company to
discharge any employee or other person at any time and for any
reason, which right is hereby reserved.
7. Plan Administrator.
The "Plan Administrator" of the Plan is Consolidated
Freightways Corporation, 175 Linfield Drive, Menlo Park, CA
94025, Telephone Number (650) 326-1700.
8. Execution.
To record the adoption of the Plan as set forth herein.
Consolidated Freightways Corporation has caused its duly
authorized officer to execute the same as of the date shown
below.
DATE: August 20, 1999
Consolidated Freightways Corporation
/s/ Stephen D. Richards
By: Stephen D. Richards
Title: Senior Vice
President and General Counsel
CONSOLIDATED FREIGHTWAYS CORPORATION
SAFETY AWARD PLAN
APPENDIX A
Eligibility
Regular employees of the Company who are assigned to certain non-
driving positions and who work without a chargeable injury for
one year or longer until accumulating at least 1200 working hours
can earn individual safe working awards.
An industrial injury is any illness or injury that was caused by
an accident, activity, or exposure while the employee was at
work. A chargeable injury is an industrial injury that causes the
employee to obtain professional medical attention.
Regular (full-time) employees in one of the following positions
can earn individual safe working awards:
Building Maintenance
Dockman
Hostler
Mechanic
Shop Employee
Combination Driver
For those employees who work on the dock part of the time and
drive part of the time, the driving time will be credited to the
safe driving award program pursuant to Appendix B and the dock
time will be credited to the safe working award program pursuant
to this Appendix A.
Supplemental (casual or part-time) employees do not receive
credit for safe working time. Also, no employee receives credit
for safe working time prior to January 1, 1979. New hires and
rehires do not receive credit for prior safe working time.
Accumulation of Work Safety Hours
Each safe working year is based on working without a chargeable
injury for a minimum of 12 consecutive months or longer until
accumulating at least 1200 working hours. If an employee has
less than 1200 working hours in a 12-month period, that safe
working year is extended to include as many months as necessary
for that employee to accumulate 1200 working hours. For example:
A dockman starts accumulating safe working time on May 1,
1999, and doesn't accumulate the full 1200 working hours
until sometime in October 2000, 18 months later. At this
time the employee will have completed one year of safe
working and starts to accrue another year of safe working on
November 1, 2000, which is the new award anniversary date.
On completing a safe working year without a chargeable injury, or
penalty from a prior period, the employee earns one safe working
year award.
If an employee is charged with a chargeable injury before earning
the 2-Year award, the employee loses all accumulated safe working
time. On the first day of the month following the date of the
chargeable injury, the employee begins accumulating safe working
time towards the 1-Year award. For example:
A dockman starts working on December 28, 1999, and earns a 1-
Year award on January 1, 2001. Then on December 2, 2001,
the dockman is charged with a chargeable injury. This
employee loses all accumulated safe working time since
December 28, 1999, and begins accumulating safe working time
all over again from January 1, 2002, towards another 1-Year
award.
If an employee is charged with a chargeable injury after earning
the 2-Year safe working award, the employee is only penalized 12-
months working time for each chargeable injury. The penalty is
computed from the employee's last award date. For example:
A mechanic earned a 2-Year award on May 1, 1999. On working
without a chargeable injury for another 12 consecutive
months, including at least 1200 working hours, this employee
will receive a 3-Year award on May 1, 2000. However, if
charged with a chargeable injury before earning the 3-Year
award (e.g. on April 15, 2000), the employee would be
penalized 12-months working time and would not earn a 3-Year
award until May 1, 2001. If charged with another chargeable
injury before earning the 3-Year award (e.g., on December
15, 2000), this employee would be penalized an additional 12-
months working time and would not be eligible for the 3-Year
award until May 1, 2002, or earn a 4-Year award until at
least May 1, 2003.
Safety Awards
For each safe working year completed the following awards, which
show the number of safe working years achieved, are given to the
employee:
Lapel pin
Wallet card
Shoulder patch
In addition to the above awards, special awards are given to the
employee earning an award for the following years:
3 Years - CF belt buckle
5 Years - Watch
10 Years - Signet ring with manufactured emerald setting and
inscription
15 Years - $300 in CFC common stock
20 Years - $400 in CFC common stock
25 Years - $500 in CFC common stock
30 Years - $600 in CFC common stock
35 Years - $800 in CFC common stock
40 Years - $1,000 in CFC common stock
After a special award has been presented, the Unit Supervisor
completes the Safe Driving/Working Awards Receipt (08075-47) and
files it in the employee's personnel file.
CONSOLIDATED FREIGHTWAYS CORPORATION
SAFETY AWARD PLAN
APPENDIX B
SECTION I. SAFE DRIVING HOURS PROGRAM
Eligibility
Regular employees of the Company who are assigned to a driving position and
drive without a preventable accident for one year or longer until
accumulating at least 1200 driving hours can earn individual safe driving
awards.
An accident is any occurrence involving a company vehicle that results in
death, injury, or property damage unless such fleet vehicle was properly
parked. Who was injured, what property was damaged, or to what extent is
not a factor. A preventable accident is any accident where the driver
failed to do everything reasonably possible to avoid it.
Regular (full-time) employees in one of the following positions can earn
individual safe driving awards:
Driver Salesman
Combination Driver
Shuttle Driver
Transport Operator
For those employees who work on the dock part of the time and drive part of
the time, the driving time will be credited to the safe driving award
program pursuant to this Appendix B and the dock time will be credited to
the safe working award program pursuant to Appendix A.
Supplemental (casual or part-time) employees do not receive credit for safe
driving time. New hires and rehires do not receive credit for prior safe
driving time.
Employees obtained by acquisition of other carriers receive credit for
prior safe driving time if the acquired carrier (i) maintained records for
certifying and/or substantiating the safe driving period, (ii) participated
in a recognized safety program such as NSC, ATA, or insurance carrier's
program, and (iii) participated in a definite system of preventability.
Accumulation of Safe Driving Hours
Each safe driving year is based on driving without a preventable accident
for a minimum of 12 consecutive months or longer until accumulating at
least 1200 driving hours. If a driver has less than 1200 driving hours in
a 12-month period, that safe driving year is extended to include as many
months as necessary for that driver to accumulate 1200 driving hours. For
example:
A driver starts accumulating safe driving time on May 1, 1999, and
doesn't accumulate the full 1200 driving hours until sometime in
October 2000, 18 months later. At this time the employee will have
completed one year of safe driving and starts another year on November
1, 2000 , which is the new award anniversary date.
On completing a safe driving year without a preventable accident, or
penalty from a prior period, the driver earns one safe driving year award.
If a driver is charged with a preventable accident before earning the 3-
Year award, the driver loses all accumulated safe driving time. On the
first day of the month following the date of the preventable accident, the
driver begins accumulating safe driving time towards the 1-Year award. For
example:
A driver starts driving on March 15, 1999, and earns a 1-Year award on
August 1, 2000, and a 2-Year award on January 1, 2002. Then on
December 2, 2002, the driver is charged with a preventable accident.
This driver loses all safe driving time accumulated since March 15,
1999, and begins accumulating safe driving time all over again from
January 1, 2003 towards another 1-Year award.
If a driver is charged with a preventable accident after earning the 3-Year
safe driving award, the driver is only penalized 12-months driving time for
each preventable accident. The penalty is computed from the driver's last
award date. For example:
A transport operator earned a 3-Year award on May 1, 1999. On driving
without a preventable accident for another 12 consecutive months,
including at least 1200 driving hours, the driver will receive a 4-
Year award on May 1, 2000. However, if charged with a preventable
accident before earning the 4-Year award (e.g. on November 1, 1999),
the driver would be penalized 12-months driving time and would not
earn a 4-Year award until May 1, 2001. If charged with another
preventable accident before earning the 4-Year award (e.g., on
December 15, 2000), this driver would be penalized an additional 12-
months driving time and would not earn a 4-Year award until at least
May 1, 2002.
Safety Awards
For each safe driving year completed the following awards which show the
number of safe driving years achieved, are given to the driver:
Lapel pin
Wallet card
Shoulder patch
In addition to the above awards, special awards are given to the driver for
the following years:
3 Years - CF belt buckle
5 Years - Watch
10 Years - Signet ring with manufactured emerald setting and
inscription
15 Years - $300 in CFC common stock
20 Years - $400 in CFC common stock
25 Years - $500 in CFC common stock
30 Years - $600 in CFC common stock
35 Years - $800 in CFC common stock
40 Years - $1,000 in CFC common stock
SECTION II. INDIVIDUAL MILLION MILER PROGRAM
Eligibility
Regular transport operators and shuttle drivers who accumulate one million
or more driving miles without a preventable accident (as defined above in
Section I) can earn individual million miler awards.
Only regular (full-time) transport operators and shuttle drivers can earn
individual million miler awards. Supplemental (casual or part-time)
drivers do not receive credit for safe driving miles. New hires and
rehires do not receive credit for prior safe driving miles. Prior safe
driving miles in other driving positions or for acquired carriers will not
be counted as eligible miles for this program.
Accumulation of Safe Driving Miles
A driver (transport operator or shuttle driver) begins accumulating safe
driving miles only after earning a 3-Year safe driving award. At that
time, the driver receives credit for all miles driven during the three-year
safe driving period and continues accumulating miles from that date on.
Shuttle drivers' driving time is converted into mileage by multiplying the
hours driven by a mileage factor of 40 miles per hour. For example, a
shuttle driver driving 40 hours per week accumulates 1600 miles.
A driver is penalized 12-months mileage for each preventable accident after
earning the 3-Year award. The penalty is computed from the driver's last
award date. For example:
A driver earned a 3-Year safe driving award on June 1, 1999. Then, on
August 1, 1999, the driver is charged with a preventable accident.
This driver loses the mileage accumulated since the last award
anniversary date (June 1, 1999) and does not begin accumulating any
additional mileage until June 1, 2000.
Safety Awards
For each million miles of safe driving, the following awards, which show
how many million miles have been safely driven, are given to the driver:
Lapel pin
Shoulder patch
Walnut reverse-etched wall plaque
Million Miler ID card
Engraved name plate for the terminal's wall plaque
In addition to the above awards, the following special awards are given to
the driver for the following mileage levels:
1 million miles - $300 in CFC common stock
2 million miles - $500 in CFC common stock
3 million miles - $1,000 in CFC common stock
4 million miles - $2,000 in CFC common stock
After a special award has been presented, the Unit Supervisor completes the
Safe Driving/Working Awards Receipt (08075-47) and files it in the
employee's personnel file.
Exhibit 4.5
Consolidated Freightways Corporation
Restricted Stock Award and Deferral Agreement
(Senior Executive)
(1999 Equity Incentive Plan)
This Agreement, dated as of________, is between Consolidated
Freightways Corporation ("CFC") and _________________ (the "Grantee").
CFC and the Grantee agree as follows:
I. Award of Stock.
A) Pursuant to the terms of the Consolidated Freightways
Corporation 1999 Equity Incentive Plan (the "Plan"), the Company hereby
grants to the Grantee the right to receive ________ shares of CFC's Common
Stock (the "Common Stock"), subject to the terms, conditions and
restrictions of this Agreement and Plan.
B) The Grantee shall be entitled to receive any shares of
Common Stock or other securities or property distributable as a stock
dividend on, or as result of any stock split, combination, exchange of
shares, reorganization, merger, consolidation or otherwise with respect to
the Common Stock granted under this Agreement upon lapse of restrictions
for the applicable Common Stock. Such dividends and distributions,
including any subsequent dividends or distributions thereon and the Common
Stock granted under this Agreement are referred to as "Restricted Stock".
C) The Grantee shall also be entitled to receive any cash
dividends on the Restricted Stock (the "Cash Dividends") upon lapse of
restrictions for the applicable Common Stock.
II. Restrictions.
"Closing Price" for any day means (i) if the
Common Stock is listed or admitted for trading on any
national securities exchange, the last sale price, or
the closing bid price if no sale occurred, of such
class of stock on the principle securities exchange of
which such class of stock is listed, or (ii) if not so
listed or traded, the last reported sales price of
Common Stock on the National Market System of the
National Association of Securities Dealers, Inc.,
Automated Quotations System, or any similar system of
automated dissemination of quotations of securities
prices then in common use, or (iii) if not, quoted the
mean between the high bid and low asked quotations for
Common Stock as reported by the National Quotation
Bureau Incorporated if at least two securities dealers
have inserted both bid and asked quotations for such
class of stock on at least 5 of the 10 preceding days.
If the Common Stock is quoted on a national securities
or central market system in lieu of a market or
quotation system described above, the closing price
shall be determined in the manner set forth in clause
(i) in the preceding sentence if bid and asked
quotations are reported but actual transactions are
not. If none of the conditions set forth above is met,
the closing price of the Common Stock on any day or the
average of such closing prices for any period shall be
the fair market value of such class of stock as
determined by a member firm of the New York Stock
Exchange, Inc. selected by CFC.
A) The Restricted Stock and the Cash Dividends shall be
restricted and subject to forfeiture until the occurrence of the following
events: (a) the Grantee shall continue to be actively employed full-time
by CFC or a subsidiary, until November 12, 2000, and (b) the average
Closing Price of CFC Common Stock for a period of ten consecutive trading
days commencing May 12, 2000 shall equal or exceed $20.00 per share of CFC
Common Stock.
B) The restriction of continued employment with CFC shall
lapse sooner on termination of employment by CFC for other than "Cause", or
by reason of death, Disability that extends more than three consecutive
months. Thereafter, the restrictions related to the price of CFC Common
Stock shall lapse upon attainment of the required appreciation at the price
of CFC Common Stock to $20 per Share after the first anniversary date of
the grant.
The Compensation Committee of the CFC Board of Directors shall determine in
its sole discretion prior to or within ninety (90) days of termination of
the Grantee whether such termination by the Company is for Cause. Cause
shall mean (i) the failure, neglect or refusal by Grantee to perform his
duties, functions or responsibilities as an employee or director of the
Company, (ii) Grantee's commission of such acts of dishonesty, fraud,
misrepresentation or other acts of moral turpitude or (iii) any other
comparable reason which the Committee, in the exercise of reasonable
business judgment, considers to constitute Cause.
"Disability" shall mean disability as defined under CFC's long-term
disability plan then in effect, or if there is no plan in effect, as
determined by the Committee in its sole discretion.
Any decision by the Committee under this Agreement shall be final and
binding on the parties to this Agreement. Such Committee's decision shall
not be bound by the prior decisions of the Committee.
C) All restrictions shall lapse sooner upon a Change in Control as
defined in the Plan, if (i) the surviving corporation or acquiring
corporation refuses to assume such stock award and this Agreement,
or to substitute similar stock awards, or (ii) Grantee's employment
is terminated without Cause (other than by death or disability)
within twenty-four (24) months after occurrence of a Change in
Control. Termination of employment shall include constructive
termination as provided in the Employment Agreement or
Management Change in Control Policy, if any, applicable to
Grantee.
D) Any attempt to dispose of the Restricted Stock and Cash Dividends or
any right thereto in contravention of the terms, conditions and
restrictions set forth in this Agreement shall be ineffective,
and any disposition of such Restricted Stock or Cash Dividends
or any right thereto purported to be effected thereby shall
be void.
E) Until the restrictions lapse, the Grantee shall not be permitted to
sell, pledge, assign, convey, transfer or otherwise alienate or
hypothecate such Restricted Stock and Cash Dividends or any right
thereto. Until such time, the Grantee shall have no rights as a
shareholder, including the right to vote such stock.
III. Forfeiture.
Grantee shall forfeit the right to receive Restricted Stock and
Cash Dividends as to which the restrictions have not lapsed upon the
occurrence of the earliest of the following circumstances:
1) termination of employment by CFC or subsidiary for Cause;
2) voluntary termination of employment with CFC or a subsidiary by
Grantee;
3) May 12, 2002 (May 12, 2003 in the event of a Change in Control);
4) one year from termination of employment by CFC or a subsidiary other
than for Cause;
5) one year from the date of death or Disability.
In any such case, all right, title and interest of the Grantee in such
Restricted Stock Award shall thereupon cease; and all right, title and
interest in and to the Restricted Stock and Cash Dividends shall vest in
CFC, with no compensation or consideration to the Grantee.
IV. Deferral Election.
A) On or prior to May 31, 1999, the Grantee may elect to defer
the receipt of all or part of the Restricted Stock and Cash Dividends
otherwise distributable to Grantee upon lapse of restrictions by signing
and returning to CFC a copy of the election form attached to this Agreement
indicating the Restricted Stock deferred and period(s) of deferral.
B) During the deferral period, the Restricted Stock and Cash
Dividends shall be subject to the claims of the general creditors of CFC
and the Grantee shall continue to have no beneficial interest in the
Restricted Stock and Cash Dividends prior to the lapse of the deferral
period(s). Once the Grantee has made a deferral election, such election
shall be irrevocable. During the deferral period while the Restricted
Stock is held in trust, Grantee shall continue to have no rights as a
shareholder, including the right to vote such stock.
C) If the Grantee experiences an Unforeseeable Financial
Emergency (as defined below), the Grantee may petition the Compensation
Committee of the Board of Directors to receive a partial or full
distribution prior to the expiration of the Deferral Period(s). The
Committee, may, in its sole discretion accept or deny such petition. Any
distribution shall not exceed the amount reasonably needed to satisfy the
Unforeseen Financial Emergency. If the petition for a distribution is
approved, any distribution shall be made within sixty (60) days of the date
of the approval. "Unforeseen Financial Emergency" means an unanticipated
emergency that is caused by an event beyond the control of the Grantee that
would result in severe financial hardship to the Grantee resulting from (i)
sudden and unexpected illness or accident of the Grantee or a dependent of
the Grantee, (ii) a loss of the Grantee's property due to casualty, or
(iii) such other extraordinary and unforeseeable circumstances arising as a
result of events beyond the control of the Grantee, all as determined in
the sole discretion of the Committee.
V. Miscellaneous.
A) This Agreement may not be modified or amended, and any
provision hereof may not be waived, except pursuant to a written agreement
signed by CFC and the Grantee. Any such modification, amendment, or waiver
signed by, or binding upon, the Grantee shall be valid and binding upon any
and all persons or entities who may, at any time, have or claim any rights
under or pursuant to this Agreement in respect of the Restricted Stock or
Cash Dividends. No waiver of any breach or default shall be deemed a
waiver of any subsequent breach or default of the same or similar nature.
B) Except as otherwise expressly provided herein, this Agreement shall be
binding upon and inure to the benefit of CFC, its successors,
assigns, and the Grantee and the Grantee's heirs, personal
representatives, successors and assigns; provided, however, that
nothing contained herein shall be construed as granting the Grantee
the right to receive a distribution for the benefit for the
Grantee, any Restricted Stock or Cash Dividends prior to the
lapse of restrictions hereunder, or if Restricted Stock is deferred,
the specified distribution date(s).
C) If any provision of this Agreement shall be invalid or unenforceable,
such invalidity or unenforceability shall attach only to such
provision and shall not in any manner affect or render invalid or
unenforceable any other severable provision of this Agreement, and
this Agreement shall be carried out as if any such invalid or
unenforceable provision were not contained
herein.
D) This Agreement may be executed in counterparts, all of which taken
together shall be deemed one original.
E) This Agreement shall be deemed to be a contract under the laws of the
State of California and for all purposes shall be construed and
enforced in accordance with the internal laws of said state without
regard to the principles of conflicts of law thereof.
F) Grantee shall pay to CFC any applicable FICA, income or other payroll
taxes on Restricted Stock grants, when due, upon demand. At its
discretion, CFC may withhold any distribution in whole or in part
until CFC is so reimbursed. In lieu thereof, CFC or a subsidiary
may withhold such amounts, if necessary, from any fees, salary,
bonus, or other amounts payable by CFC or a subsidiary to Grantee
to pay any applicable taxes on Grantee for which CFC or subsidiary
is required to pay to taxing authorities, or retain and withhold
a number of shares having a market value of not less than the
amount of such taxes and cancel (in whole or in part) any such
shares so withheld in order to reimburse the Company for any
such taxes.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the day and year above first written.
CONSOLIDATED FREIGHTWAYS
CORPORATION
By: _________________________
Name : Stephen D. Richards
Title: Senior Vice President
and General Counsel
GRANTEE
By: _________________________
Name :
Title:
Exhibit 5.1
August 20, 1999
Consolidated Freightways Corporation
175 Linfield Drive
Menlo Park, California 94025
Ladies and Gentlemen:
I am General Counsel of Consolidated Freightways Corporation (the
("Company") and am rendering this opinion with respect to certain matters
in connection with the filing by the Company of a Registration Statement on
Form S-8 (the "Registration Statement") with the Securities and Exchange
Commission covering the offering of up to 150,000 shares of the Company's
Common Stock, $.01 par value (the "Safety Award Plan Shares"), pursuant to
its Safety Award Plan, as amended (the "Safety Award Plan"), up to
2,000,000 shares of the Company's Common Stock, $0.01 par value (the
"Incentive Plan Shares") pursuant to its 1999 Equity Incentive Plan (the
"Incentive Plan") and up to 250,000 shares of the Company's Common Stock,
$0.01 par value (the "Directors' Plan Shares") pursuant to its 1999 Non-
Employee Directors' Stock Option Plan (the "Directors' Plan"). The Safety
Award Plan Shares, Incentive Plan Shares and Directors' Plan Shares are
referred to herein as the "Shares" and the Safety Award Plan, Incentive
Plan and Directors' Plan are referred to herein as the "Plans."
In connection with this opinion, I have examined the Registration Statement
and related Prospectuses, the Company's Amended and Restated Certificate of
Incorporation and Amended and Restated Bylaws, and such other documents,
records, certificates, memoranda and other instruments as I deem necessary
as a basis for this opinion. I have assumed the genuineness and
authenticity of all documents submitted to me as originals, the conformity
to originals of all documents submitted to me as copies thereof, and the
due execution and delivery of all documents where due execution and
delivery are a prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, I am of the opinion
that the Shares, when sold and issued in accordance with the Plans, the
Registration Statement and related Prospectuses, will be validly issued,
fully paid, and nonassessable (except as to shares issued pursuant to
certain deferred payment arrangements, which will be fully paid and
nonassessable when such deferred payments are made in full).
I consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
By:
/s/ Stephen D. Richards
Stephen D. Richards
Senior Vice President and General Counsel,
Consolidated Freightways Corporation
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our reports dated January
25, 1999 included and incorporated by reference in Consolidated Freightways
Corporation's Form 10-K for the year ended December 31, 1998 (File No. 001-
12149) and to all references to our firm included in this registration
statement.
/s/Arthur Andersen LLP
Portland, Oregon
August 19, 1999
