COVENANT
TRANSPORT, INC.
2006
OMNIBUS INCENTIVE PLAN
AWARD
NOTICE
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GRANTEE:
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TYPE
OF AWARD:
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Restricted
Stock Award (Special Grant)
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NUMBER
OF SHARES:
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DATE
OF GRANT:
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2.
Restrictions and Vesting. Subject to the terms and conditions set
forth in this Award Notice, the Plan, and Schedule A attached hereto, and
provided you remain continuously in the employment or service of the Company
or
any Subsidiary through the Vesting Date, one hundred percent (100%) of the
Restricted Shares shall vest, as of the Vesting Date (as defined in Schedule
A) if (and only if) the Performance Goal (as defined in Schedule A)
has been satisfied and the Committee has certified such satisfaction in
accordance with Section 3.
3. Determination
of Vesting. The Committee shall undertake to complete its certification on
or prior to March 31 next following each Performance Period. If it shall
be
impractical for the Committee to complete its certification by such date,
the
Committee shall do so as soon as reasonably practical thereafter. Based on
that
review and certification, the Committee shall then instruct the Company as
to
whether the Restricted Shares shall vest.
4. Effect
of Death or Other Termination of Employment. In the event of your death or
the termination of your employment or service to the Company or any Subsidiary
for any reason prior to the vesting of the Restricted Shares, including the
review and certification of results by the Committee as provided in Section
3,
the Restricted Shares shall be forfeited as of the date of your death or
such
termination.
5. Effect
of Change In Control.
(a)
In General. Upon the occurrence of a Change In Control (as defined
below), the Restricted Shares shall immediately vest as of the date of the
occurrence of such event.
(b)
"Change In Control" Defined. The term "Change In Control"
means a change in control of the Company of a nature that would be required
to
be reported in response to Item 5.01 of a Current Report on Form 8-K, as
in
effect on December 31, 2004, pursuant to Section 13 or 15(d) of the Exchange
Act; provided that, without limitation, a Change In Control shall be deemed
to
have occurred at such time as:
(i)
Any "person" within the meaning of Section 14(d)(2) of the Exchange Act
and Section 13(d)(3) of the Exchange Act, other than a Permitted Holder becomes
the "beneficial owner," as defined in Rule 13d-3 under the Exchange Act,
directly or indirectly, of fifty percent (50%) or more of the combined voting
power of the outstanding securities of the Company ordinarily having the
right
to vote in the election of directors; provided, however, that the following
will
not constitute a Change In Control: any acquisition by any corporation if,
immediately following such acquisition, more than seventy-five percent (75%)
of
the outstanding securities of the acquiring corporation (or the parent thereof)
ordinarily having the right to vote in the election of directors is beneficially
owned by all or substantially all of those persons who, immediately prior
to
such acquisition, were the beneficial owners of the outstanding securities
of
the Company ordinarily having the right to vote in the election of directors;
(ii)
Individuals who constitute the Board on the date of the approval of the
Plan (the "Incumbent Board") have ceased for any reason to constitute at
least a majority thereof, provided that any person becoming a director
subsequent to the date of the approval of the Plan, whose election or nomination
for election by the Company's stockholders was approved by a vote of at least
three-fourths (3/4) of the directors comprising the Incumbent Board, either
by a
specific vote or by approval of the proxy statement of the Company in which
such
person is named as a nominee for director without objection to such nomination
(other than an election or nomination of an individual whose initial assumption
of office is in connection with an actual or threatened "election contest"
relating to the election of directors of the Company, as such terms are used
in
Rule 14a-11 under the Exchange Act as in effect on January 23, 2000, or "tender
offer," as such term is used in Section 14(d) of the Exchange Act), shall
be,
for purposes of the Plan, considered as though such person were a member
of the
Incumbent Board;
(iii)
Upon the consummation by the Company of a reorganization, merger, or
consolidation, other than one with respect to which all or substantially
all of
those persons who were the beneficial owners, immediately prior to such
reorganization, merger, or consolidation, of outstanding securities of the
Company ordinarily having the right to vote in the election of directors
own,
immediately after such transaction, more than seventy-five percent (75%)
of the
outstanding securities of the resulting corporation ordinarily having the
right
to vote in the election of directors; or
(iv)
Upon the approval by the Company's stockholders of a complete liquidation
and dissolution of the Company or the sale or other disposition of all or
substantially all of the assets of the Company other than to a Subsidiary.
(c)
"Permitted Holder" Defined. The term "Permitted Holder"
means: (i) the Company or a Subsidiary, (ii) any employee benefit plan sponsored
by the Company or any Subsidiary, or (iii) David or Jacqueline Parker or
their
siblings, children, or grandchildren ("Family Members") or a trust,
corporation, partnership, limited partnership, limited liability company,
or
other such entity, so long as at least eighty percent (80%) of the beneficial
interests of the entity are held by Mr. or Mrs. Parker and/or one or more
Family
Members, where such person(s) or entity acquired their Company stock from
Mr. or
Mrs. Parker.
6.
Book-Entry Registration. The Restricted Shares initially will be
evidenced by book-entry registration only, without the issuance of a certificate
representing the Restricted Shares.
7.
Issuance of Shares. Subject to Sections 8 and 13 of this Award
Notice, upon the vesting of the Restricted Shares pursuant to this Award
Notice,
the Company shall issue a certificate representing the Restricted Shares
as
promptly as practicable following the date of vesting. The Restricted Shares
may
be issued during your lifetime only to you, or after your death to your
designated beneficiary, or, in the absence of such beneficiary, to your duly
qualified personal representative.
8.
Withholding. You shall pay to the Company or a Subsidiary, or make other
arrangements satisfactory to the Company regarding the payment of, any federal,
state, or local taxes of any kind required by applicable law to be withheld
with
respect to the Restricted Shares awarded under this Award Notice. Your right
to
receive the Restricted Shares under this Award Notice is subject to, and
conditioned on, your payment of such withholding amounts.
9.
Nonassignability. The Restricted Shares and the right to vote such
shares and to receive dividends thereon, may not, except as otherwise provided
in the Plan, be sold, assigned, transferred, pledged, or encumbered in any
way
prior to the vesting of such shares, whether by operation of law or otherwise,
except by will or the laws of descent and distribution. After vesting, the
sale
or other transfer of the shares of Common Stock shall be subject to applicable
laws and regulations under the Exchange Act.
10.
Rights as a Stockholder; Limitation on Rights. Unless the Award is
cancelled as provided in Section 3 or 4 of this Award Notice, prior to the
vesting of the Restricted Shares, you will have all of the other rights of
a
stockholder with respect to the Restricted Shares so awarded, including,
but not
limited to, the right to receive such cash dividends, if any, as may be declared
on such shares from time to time and the right to vote (in person or by proxy)
such shares at any meeting of stockholders of the Company. Neither the Plan,
the
granting of the Award, nor this Award Notice gives you any right to remain
in
the employment of the Company or any Subsidiary.
11. Holding
Period; Obligation to Maintain Stock Ownership. With the exception of a
Permitted Tax Sale (as defined below), you are required to hold the Restricted
Shares for one year following the Vesting Date before any disposition, hedge,
or
pledge thereof, or other transaction where the economic risk with respect
to the
Restricted Shares is transferred; provided, you shall be permitted to make
a
bona fide pledge of Restricted Shares during such one year period where such
pledge is with full recourse. The Company is authorized to place a restrictive
legend on such shares, issue stop-transfer instructions to the transfer agent,
or take such other actions as may be advisable, in the Committee's sole
discretion to enforce such holding period. Your ability to dispose of Restricted
Shares after such one-year period may be further limited by stock ownership
guidelines in effect from time-to-time. A "Permitted Tax Sale" shall mean
a sale of that number of Restricted Shares sufficient to pay federal and
state
taxes on the Restricted Shares that vested at an assumed forty-five percent
(45%) tax rate.
12.
Rights of the Company and Subsidiaries. This Award Notice does not
affect the right of the Company or any Subsidiary to take any corporate action
whatsoever, including without limitation its right to recapitalize, reorganize,
or make other changes in its capital structure or business, merge or
consolidate, issue bonds, notes, shares of Common Stock, or other securities,
including preferred stock, or options therefor, dissolve or liquidate, or
sell
or transfer any part of its assets or business.
13.
Restrictions on Issuance of Shares. If at any time the Company
determines that the listing, registration, or qualification of the Restricted
Shares upon any securities exchange or quotation system, or under any state
or
federal law, or the approval of any governmental agency, is necessary or
advisable as a condition to the issuance of a certificate representing any
vested Restricted Shares, such issuance may not be made in whole or in part
unless and until such listing, registration, qualification, or approval shall
have been effected or obtained free of any conditions not acceptable to the
Company.
14.
Plan Controls; Definitions. The Award is subject to all of the
provisions of the Plan, which is hereby incorporated by reference, and is
further subject to all the interpretations, amendments, rules, and regulations
that may from time to time be promulgated and adopted by the Committee pursuant
to the Plan. Except as set forth in the last sentence of this Section 14,
in the
event of any conflict among the provisions of the Plan and this Award Notice,
the provisions of the Plan will be controlling and determinative. The
capitalized terms used in this Award Notice and not otherwise defined herein
are
defined in the Plan; provided, however, that when the defined term "Company"
is
used in the Plan in Sections 2.1(c), 2.1(d), 2.1(g), 2.1(o), 2.1(r), 2.1(cc),
4.2(h) (second usage), 4.3, 6.1, 6.2, 11.3, 13.2 (second usage), 16.2, and
16.4,
the term "Company" shall be interpreted to mean only Covenant Transport,
Inc., a
Nevada corporation (and not also its Subsidiaries).
15.
Amendment. Except as otherwise provided by the Plan, the Company
may only alter, amend, or terminate this Award with your consent.
16.
Governing Law. This Award Notice shall be governed by and construed
in accordance with the laws of the State of Nevada, except as superseded
by
applicable federal law, without giving effect to its conflicts of law
provisions.
17. Notices.
All
notices and other communications to the Company required or permitted under
this
Award Notice shall be written, and shall be either delivered personally or
sent
by registered or certified first-class mail, postage prepaid and return receipt
requested addressed to the Company's office at 400 Birmingham Highway,
Chattanooga, Tennessee 37419, Attention: Chief Financial Officer. Each such
notice and other communication delivered personally shall be deemed to have
been
given when delivered. Each such notice and other communication delivered
by mail
shall be deemed to have been given when it is deposited in the United States
mail in the manner specified herein.
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ACKNOWLEDGEMENT
The
undersigned acknowledges receipt of, and understands and agrees to be bound
by,
this Award Notice and the Plan. The undersigned further acknowledges that
this
Award Notice and the Plan set forth the entire understanding between him
or her
and the Company regarding the restricted stock granted by this Award Notice
and
that this Award Notice and the Plan supersede all prior oral and written
agreements on that subject.
Dated:
_______________, 20__
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Grantee:
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Covenant
Transport, Inc.
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By:
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