AMERICAN FREIGHTWAYS CORP, SC 14D9, EX-99.(E)(2), 2000-11-20

AMERICAN FREIGHTWAYS CORP
SC 14D9, EX-99.(E)(2), 2000-11-20
TRUCKING (NO LOCAL)

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EXHIBIT E(2)

CONFORMED COPY
IRREVOCABLE PROXY AND VOTING AGREEMENT

AGREEMENT dated as of November 12, 2000 among FEDEX CORPORATION, a
Delaware corporation ("Buyer"), and each other Person set forth on the signature
pages hereof (each a "Shareholder" and collectively the "Shareholders").
Capitalized terms used but not separately defined herein shall have the meanings
assigned to such terms in the Merger Agreement (as defined below).

WHEREAS, in order to induce Buyer and Merger Subsidiary to enter into
an Agreement and Plan of Merger dated as of the date hereof (as amended, the
"Merger Agreement") with American Freightways Corporation, an Arkansas
corporation (the "Company"), Buyer, which is also a shareholder of the
Company, has requested the Shareholders, and each Shareholder has agreed, to
enter into this Agreement with respect to all shares of common stock, par value
$0.01 per share, of the Company that such Shareholder beneficially owns and may
hereafter acquire (collectively, the "Shares");

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE 1
GRANT OF PROXY; VOTING AGREEMENT

SECTION 1.01. Voting Agreement. (a) Each Shareholder hereby irrevocably
and unconditionally agrees to vote all Shares that such Shareholder is entitled
to vote, at the time of any vote to approve and adopt the Merger Agreement, the
Merger and all agreements related to the Merger and any actions related thereto
at any meeting of the shareholders of the Company, and at any adjournment
thereof, at which such Merger Agreement and other related agreements (or any
amended version thereof), or such other actions, are submitted for the
consideration and vote of the shareholders of the Company, in favor of the
approval and adoption of the Merger Agreement, the Merger and the transactions
contemplated by the Merger Agreement.

(b) Each Shareholder hereby agrees that it will not vote any Shares that
such Shareholder is entitled to vote in favor of the approval of any (i)
Acquisition Proposal, (ii) reorganization, recapitalization, liquidation or
winding up of the Company or any other extraordinary transaction involving the
Company, (iii) corporate action the consummation of which would frustrate the
purposes, or prevent or delay the consummation, of the transactions contemplated
by the

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Merger Agreement or (iv) other matter relating to, or in connection with, any of
the foregoing matters.

SECTION 1.02. Irrevocable Proxy. Each Shareholder hereby revokes any and
all previous proxies granted with respect to the Shares beneficially owned by
such Shareholder. By entering into this Agreement, each Shareholder hereby
grants a proxy appointing Buyer as such Shareholder's attorney-in-fact and
proxy, with full power of substitution, for and in such Shareholder's name, to
vote, express, consent or dissent, or otherwise to utilize such voting power
solely for the purposes contemplated by Section 1.01 above as Buyer or its proxy
or substitute shall, in Buyer's sole discretion, deem proper with respect to the
Shares beneficially owned by such Shareholder. THE PROXY GRANTED BY EACH
SHAREHOLDER PURSUANT TO THIS ARTICLE 1 IS IRREVOCABLE AND THE APPOINTMENT IS
COUPLED WITH AN INTEREST, HAVING BEEN GRANTED IN CONSIDERATION OF BUYER ENTERING
INTO THIS AGREEMENT AND THE MERGER AGREEMENT, AND INCURRING CERTAIN RELATED FEES
AND EXPENSES. The proxy granted by each Shareholder shall be revoked upon
termination of this Agreement in accordance with its terms.

ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF EACH SHAREHOLDER

Each Shareholder, severally and not jointly, represents and warrants to
Buyer that:

SECTION 2.01. Authorization, Enforceability. If such Shareholder is not
a natural Person, the execution, delivery and performance by such Shareholder of
this Agreement and the consummation by such Shareholder of the transactions
contemplated hereby are within the powers of such Shareholder. This Agreement
constitutes a valid and binding Agreement of such Shareholder. If such
Shareholder is executing this Agreement in a representative or fiduciary
capacity, the Person signing this Agreement has full power and authority to
enter into and perform this Agreement. If such Shareholder is a natural Person,
the Shares beneficially owned by such Shareholder do not constitute marital
property under the laws of the State of Arkansas or any other applicable laws,
or if such Shares constitute marital property, the consent of such Shareholder's
spouse is not required for the execution and delivery of this Agreement or the
performance by such Shareholder of the obligations of the Shareholder hereunder.

SECTION 2.02. Non-Contravention. The execution, delivery and performance
by such Shareholder of this Agreement and the consummation of the

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transactions contemplated hereby do not and will not (i) violate any applicable
law, rule, regulation, judgment, injunction, order or decree to which
Shareholder is a party or by which such Shareholder is bound, (ii) require any
consent or other action by any Person under, constitute a default under, or give
rise to any right of termination, cancellation or acceleration or to a loss of
any benefit to which such Shareholder is entitled under any provision of any
agreement or other instrument binding on such Shareholder or (iii) result in the
imposition of any Lien on any asset of such Shareholder.

SECTION 2.03. Ownership of Shares. Such Shareholder is the record and
beneficial owner of the Shares listed on the signature pages hereof opposite
such Shareholder's name, free and clear of any Liens and any other limitations
or restrictions (including any restriction on the right to vote or otherwise
dispose of such Shares). None of the Shares held by such Shareholder are subject
to any voting trust, irrevocable proxy or other agreement or arrangement with
respect to the voting of such Shares (other than this Agreement).

SECTION 2.04. Total Shares. Except for the Shares set forth on the
signature page hereto opposite such Shareholder's name or except for options
issued pursuant to the Company Plans or Director Plans, such Shareholder does
not beneficially own any (i) shares of capital stock or voting securities of the
Company, (ii) securities of the Company convertible into or exchangeable for
shares of capital stock or voting securities of the Company or (iii) options or
other rights to acquire from the Company any capital stock, voting securities or
securities convertible into or exchangeable for capital stock or voting
securities of the Company.

SECTION 2.05. Finder's Fees. No investment banker, broker, finder or
other intermediary is entitled to a fee or commission from Buyer or the Company
in respect of this Agreement based upon any arrangement or agreement made by or
on behalf of such Shareholder.

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to each Shareholder that:

SECTION 3.01. Corporate Authorization. The execution, delivery and
performance by Buyer of this Agreement and the consummation by Buyer of the
transactions contemplated hereby are within the corporate powers of Buyer and
have been duly authorized by all necessary corporate action. This Agreement
constitutes a valid and binding Agreement of Buyer.

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ARTICLE 4
COVENANTS OF SHAREHOLDER
Each Shareholder, severally and not jointly, hereby covenants and agrees
that:

SECTION 4.01. No Proxies for or Encumbrances on Shares. Except pursuant to
the terms of this Agreement, such Shareholder shall not, without the prior
written consent of Buyer, directly or indirectly, (i) grant any proxies or enter
into any voting trust or other agreement or arrangement with respect to the
voting of any Shares beneficially owned by such Shareholder or (ii) acquire,
sell, assign, transfer, encumber or otherwise dispose of, or enter into any
contract, option or other arrangement or understanding with respect to the
direct or indirect acquisition or sale, assignment, transfer, encumbrance or
other disposition of, any such Shares during the term of this Agreement.
Notwithstanding the preceding sentence, (i) the Shareholders may at any time
tender in the Offer a number of Shares not to exceed 1,000,000 Shares in the
aggregate and (ii) in the event that immediately prior to such time as the Offer
is scheduled to expire (after giving effect to any extensions of the Offer), all
conditions to the Offer other than the Minimum Condition shall have been
satisfied or, to the extent permitted under applicable law, waived, unless
Parent shall have agreed to waive the Minimum Condition, then, in addition to
any Shares tendered by the Shareholders in reliance on clause (i) of this
sentence, (A) if so requested by Parent, the Shareholders shall and (B) the
Shareholders, at their option, may tender in the Offer such number of Shares as,
when added to that number of other Shares which shall then have been validly
tendered in the Offer and not withdrawn, would equal 50.1% of Shares
outstanding, but in the case of clause (A) not more than 1,000,000 Shares in the
aggregate regardless of whether any other Shares shall theretofore have been
tendered by any Shareholder pursuant to clause (i) of this sentence, and in the
case of clause (B) up to an aggregate maximum, including any Shares previously
tendered by the Shareholders pursuant to clause (i) or clause (ii) (A) of this
sentence, of 3,200,000 Shares. In no event shall the Shareholders tender in the
Offer any Shares in excess of 3,200,000 Shares. Parent shall (i) use its
reasonable best efforts to cause any depositary or agent effecting the Offer to
provide one representative of the Shareholders designated by the Shareholders
current information regarding the status of the Offer and the number of Shares
tendered and not validly withdrawn and (ii) coordinate with any such depositary
or agent, in each case so as to afford to the Shareholders the right to tender
Shares in the Offer as permitted pursuant to this Section 4.01 on a timely
basis. Such Shareholder shall not seek or solicit any such acquisition or sale,
assignment, transfer, encumbrance or other disposition or any such contract,
option or other arrangement or understanding and agrees to notify Buyer
promptly, and to provide all details requested by Buyer, if such Shareholder
shall be approached or
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solicited, directly or indirectly, by any Person with respect to any of the
foregoing.

SECTION 4.02. Other Offers. (a) Such Shareholder, in its capacity as a
holder of Shares, shall not, directly or indirectly, (i) solicit, initiate or
take any action to facilitate or encourage the submission of any Acquisition
Proposal, (ii) enter into or participate in any discussions or negotiations
with, furnish any information relating to the Company or any of its Subsidiaries
or afford access to the business, properties, assets, books or records of the
Company or any of its Subsidiaries to, otherwise cooperate in any way with, or
knowingly assist, participate in, facilitate or encourage any effort by any
Third Party that is seeking to make, or has made, an Acquisition Proposal, or
(iii) grant any waiver or release under any standstill or similar agreement with
respect to any class of equity securities of the Company or any of its
Subsidiaries; provided that if such Shareholder or any trustee of any
Shareholder is a director of the Board of Directors of the Company, such
Shareholder or trustee, as the case may be, may take any action in such capacity
permitted to be taken pursuant to Section 7.04(b) of the Merger Agreement.

(b) Such Shareholder will promptly notify Buyer upon obtaining any
knowledge of any Acquisition Proposal or any request for nonpublic information
relating to the Company or any of its Subsidiaries or for access to the
properties, books or records of the Company or any of its Subsidiaries, or any
request for a waiver or release under any standstill or similar agreement by any
Person who indicates that it is considering making, or has made, an Acquisition
Proposal and will keep Buyer fully informed, on a current basis, of any material
developments with respect to any such Acquisition Proposal, indication or
request.

SECTION 4.03. Appraisal Rights. Shareholder agrees not to exercise any
rights (including, without limitation, under Section 4-27-1302 of Arkansas-1987
Business Corporation Act) to demand appraisal of any Shares which may arise with
respect to the Merger.

ARTICLE 5
MISCELLANEOUS

SECTION 5.01. Further Assurances. Buyer and each Shareholder will
execute and deliver, or cause to be executed and delivered, all further
documents and instruments and use its best efforts to take, or cause to be
taken, all actions and to do, or cause to be done, all things necessary, proper
or advisable under applicable laws and regulations, to consummate and make
effective the transactions contemplated by this Agreement.

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SECTION 5.02. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including facsimile transmission) and
shall be given,

if to Buyer, to:

FedEx Corporation
942 South Shady Grove Road
Memphis, Tennessee 38120
Fax: (901) 818-7590
Attention: Kenneth R. Masterson

with a copy to:

Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Fax: (212) 450-4800
Attention: Dennis Hersch

if to any Shareholder, to the address set forth on the signature
pages hereof below such Shareholder's name

or such other address or facsimile number as such party may hereafter
specify for the purpose by notice to the other parties hereto. All such notices,
requests and other communications shall be deemed received on the date of
receipt by the recipient thereof if received prior to 5 p.m. in the place of
receipt and such day is a Business Day. Otherwise, any such notice, request or
communication shall be deemed not to have been received until the next
succeeding Business Day.

SECTION 5.03. Amendments; Termination. Any provision of this Agreement may
be amended or waived if, but only if, such amendment or waiver is in writing and
is signed, in the case of an amendment, by each party to this Agreement or in
the case of a waiver, by the party against whom the waiver is to be effective.
This Agreement and all rights and obligations of the parties hereto shall
terminate on the date that is four months after the termination of the Merger
Agreement; provided, however, that (A) upon the termination of the Merger
Agreement, the aggregate number of Shares subject to this Agreement shall be
reduced by 1,000,000 (net of any Shares tendered in the Offer as permitted by
Section 4.01 hereof) pro rata among the Shareholders on the basis of the number
of Shares beneficially owned and (B) upon a termination of the Merger Agreement
pursuant to Section 11.03(b)(iii) thereof, the obligation of the Shareholders to
tender in the Offer pursuant to clause (ii)(A) of the second sentence of Section
4.01 shall automatically terminate. For the avoidance of doubt

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in the event 1,000,000 or more Shares are tendered in the Offer by the
Shareholders, clause (A) of the proviso in the preceding sentence shall be
without effect.

SECTION 5.04. Expenses. All costs and expenses incurred in connection
with this Agreement shall be paid by the party incurring such cost or expense.

SECTION 5.05. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of the other parties hereto, except that Buyer may transfer
or assign its rights and obligations to any Affiliate of Buyer.

SECTION 5.06. Governing Law. This Agreement shall be governed by and
construed in accordance with the law of the State of Delaware, without regard to
the conflicts of law rules of such state.

SECTION 5.07. Jurisdiction. Any suit, action or proceeding seeking to
enforce any provision of, or based on any matter arising out of or in connection
with, this Agreement or the transactions contemplated hereby may be brought in
any federal court located in the State of Delaware or any Delaware state court,
and each of the parties hereby consents to the jurisdiction of such courts (and
of the appropriate appellate courts therefrom) in any such suit, action or
proceeding and irrevocably waives, to the fullest extent permitted by law, any
objection that it may now or hereafter have to the laying of the venue of any
such suit, action or proceeding in any such court or that any such suit, action
or proceeding brought in any such court has been brought in an inconvenient
forum. Process in any such suit, action or proceeding may be served on any party
anywhere in the world, whether within or without the jurisdiction of any such
court.

SECTION 5.08. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

SECTION 5.09. Counterparts; Effectiveness. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by all of the other parties hereto.

SECTION 5.10. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to

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be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any party. Upon such a
determination, the parties shall modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby be consummated as originally
contemplated to the fullest extent possible.

SECTION 5.11. Specific Performance. The parties hereto agree that
irreparable damage would occur if any provision of this Agreement were not
performed in accordance with the terms hereof and that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
or to enforce specifically the performance of the terms and provisions hereof in
any federal court located in the State of Delaware or any Delaware state court,
in addition to any other remedy to which they are entitled at law or in equity.

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.

FEDEX CORPORATION

By: /s/ Kenneth R. Masterson
------------------------------
Name: Kenneth R. Masterson
Title: Executive Vice President,
General Counsel and Secretary

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.

/s/ F.S. Garrison
-------------------------
F.S. Garrison

F.S. GARRISON REVOCABLE
CHILDREN'S TRUST

/s/ F.S. Garrison
-------------------------
F.S. Garrison
Trustee

F.S. GARRISON FAMILY LIMITED
PARTNERSHIP NO. ONE

/s/ F.S. Garrison
-------------------------
F.S. Garrison
General Partner

F.S. GARRISON FAMILY LIMITED
PARTNERSHIP NO. TWO

/s/ F.S. Garrison
-------------------------
F.S. Garrison
General Partner

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CYNTHIA KAYE GARRISON TRUST
NO. ONE

/s/ Cynthia Kaye Garrison
--------------------------------
Cynthia Kaye Garrison
Trustee

LISA RAE GARRISON TRUST

/s/ F.S. Garrison
--------------------------------
F.S. Garrison
Trustee

LISA GARRISON UTMA

/s/ Tom Garrison
--------------------------------
Tom Garrison
Trustee

SARAH ANNE GARRISON TRUST

/s/ Tom Garrison
--------------------------------
Tom Garrison
Trustee

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SARAH ANNE GARRISON UTMA

/s/ Tom Garrison
--------------------------------
Tom Garrison
Trustee

/s/ Tom Garrison
--------------------------------
Tom Garrison

SARAH ANNE GARRISON TRUST 2000

/s/ William P. Garrison
--------------------------------
William P. Garrison
Trustee

F.S. GARRISON IRA

/s/ F.S. Garrison
--------------------------------
F.S. Garrison

/s/ William P. Garrison
--------------------------------
William P. Garrison

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/s/ Daniel A. Garrison
--------------------------------
Daniel A. Garrison

GARRISON LIVING TRUST