e8vk

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, K+vmVYilBMYxfjTPw026KXgPPkpEfTcjM4c4gbvecGdCJjrD5XlUTZGMv3Hf7ssx UhYtSOrcyaw2wl4oy88W9A== 0000950134-05-018804.txt : 20051005 0000950134-05-018804.hdr.sgml : 20051005 20051005105204 ACCESSION NUMBER: 0000950134-05-018804 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20050930 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20051005 DATE AS OF CHANGE: 20051005 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KITTY HAWK INC CENTRAL INDEX KEY: 0000932110 STANDARD INDUSTRIAL CLASSIFICATION: AIR TRANSPORTATION, NONSCHEDULED [4522] IRS NUMBER: 752564006 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32284 FILM NUMBER: 051123751 BUSINESS ADDRESS: STREET 1: P O BOX 612787 STREET 2: 1515 W 20TH ST CITY: DALLAS/FT WORTH INTN STATE: TX ZIP: 75261 BUSINESS PHONE: 9724562200 MAIL ADDRESS: STREET 1: P O BOX 612787 STREET 2: 1515 W 20TH ST CITY: DALLAS/FT WORTH INTN STATE: TX ZIP: 75261 8-K 1 d29198e8vk.htm FORM 8-K e8vk

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 30, 2005

Kitty Hawk, Inc.

(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation)		0-25202 (Commission File Number)		75-2564006 (I.R.S. Employer Identification No.)


1515 West 20^th Street
P.O. Box 612787
DFW International Airport, Texas		75261
(Address of principal		(Zip Code)
executive offices)

Registrant’s telephone number, including area code: (972) 456-2200

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):


o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)


o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Item 1.01		Entry into a Material Definitive Agreement.

Changes to Outside Director Compensation Arrangements

After reviewing the Company’s outside director compensation arrangements with an independent compensation consultant, the Board of Directors of the Company approved the following changes to its outside director compensation arrangements effective September 30, 2005. Except as noted below, the outside director compensation arrangements have not been changed.

Annual Retainer. The annual retainer has been increased from $14,000 per year to $25,000 per year.

Annual Equity Award and Tax Reimbursement. The Company has replaced the annual stock option grant to purchase a number of shares of common stock with a value (as determined under the 2003 Kitty Hawk Long-Term Equity Incentive Plan (the “Plan”)) of $15,000 on the date of such grant with an annual restricted stock unit grant to receive a number of shares of common stock with a value (as determined under the Plan) of $28,750 on the date of such grant. The Board of Directors of the Company has reserved the right in its discretion to change the value of future annual grants. In addition, the Company has eliminated the annual tax reimbursement of $10,000 per outside director to be paid upon the exercise of awards under the Plan. The elimination of the tax reimbursement does not affect previously accrued, but unused annual tax reimbursements. The material terms of the restricted stock units are described below.

Equity Retention. Each outside director is required to retain ownership of a number of shares of common stock (including the value of vested restricted stock units and shares of common stock underlying vested stock options) with a fair market value equal to three times the director’s annual retainer fee (the “Threshold Amount”), up from one time the director’s annual retainer fee. Outside directors are no longer required to purchase any shares of common stock to meet the equity retention threshold, but outside directors cannot sell shares of common stock if they would hold less than the Threshold Amount after the sale.

Restricted Stock Units

The Board of Directors of the Company approved the award of restricted stock units in lieu of stock options to outside directors and approved the award of restricted stock units and/or stock options to employees, including certain members of senior management. The following description of the material terms of the restricted stock units is qualified in its entirety to the forms of the restricted stock unit agreements attached hereto and incorporated by reference herein.

Time of Grant and Price. Restricted stock units are granted automatically to outside directors on September 30 of each year, and may be granted at the discretion of the Compensation Committee of the Board of Directors to employees, including senior management, at the closing price of the common stock on the date of grant or, if the common stock is not traded on that day, then at the price on the immediately proceeding day on which the common stock was traded.

Vesting and Change of Control. The restricted stock units vest pro-rata over four years for employees and over one year on a quarterly basis for outside directors. In addition, the restricted stock units automatically accelerate and vest upon the occurrence of a Change of Control, as defined in the Plan (a “Change of Control”). If the definition of Change of Control in the Plan makes the restricted stock unit subject to 409A of the Internal Revenue Code (“409A”), then the definition of Change of Control shall be the definition provided for under 409A and the regulations and other guidance thereunder.

Conversion. The restricted stock units automatically convert into shares of common stock upon the earlier to occur of (i) termination of service as an employee, consultant or outside director, (ii) a Change of Control or (iii) with respect only to the annual grants to outside directors, four years from the date of grant. In the case of a conversion resulting from a termination of service as an employee (other than as a result of death), if the employee is a “specified employee” as defined in 409A, the conversion will instead occur on the earlier of (i) six months from the date of termination of service and (ii) the employee’s death.

Forfeiture. With respect to restricted stock units awarded to employees, the restricted stock units are immediately forfeited without compensation upon a termination of employment for cause, as defined in the restricted stock unit award agreement. In addition, upon termination of service as an employee or outside director, all unvested restricted stock units are forfeited.

Amendment No. 2 to the Plan

The Company also adopted Amendment No. 2 to the Plan (the “Amendment”) effective September 30, 2005. The Amendment implements the changes to the outside director compensation arrangements by (i) eliminating the annual tax reimbursement on a going-forward basis and (ii) providing for annual grants of restricted stock units or other awards to outside directors in lieu of annual stock option grants.

Forms of Stock Option Agreements

The Company has attached to this Form 8-K the current form of its employee incentive stock option agreement and non-qualified stock option agreement.

Item 9.01 Financial Statements and Exhibits.


Exhibit No.		Description

10.1		Form of Executive Officer Restricted Stock Unit Award Agreement.

10.2		Form of Outside Director Restricted Stock Unit Award Agreement.

10.3		Form of Employee Incentive Stock Option Agreement.

10.4		Form of Employee Non-Qualified Stock Option Agreement.

10.5		Amendment No. 2 to the 2003 Kitty Hawk Long-Term Equity Incentive Plan, dated as of September 30, 2005.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


KITTY HAWK, INC.
By:	/s/ Steven E. Markhoff
	Name:	Steven E. Markhoff
	Title:	Vice President Strategic Planning, General Counsel and Corporate Secretary

Date: October 5, 2005

EX-10.1 2 d29198exv10w1.htm FORM OF EXECUTIVE OFFICER RESTRICTED STOCK UNIT AWARD AGREEMENT exv10w1

Exhibit 10.1

RESTRICTED STOCK UNIT AWARD AGREEMENT
UNDER THE KITTY HAWK
2003 LONG-TERM EQUITY INCENTIVE PLAN

1. Award of Restricted Stock Units. Pursuant to the Kitty Hawk 2003 Long-Term Equity Incentive Plan (the “Plan”) for Employees, Consultants and Outside Directors of Kitty Hawk, Inc., a Delaware corporation (“Kitty Hawk”), and its Subsidiaries (collectively with Kitty Hawk, the “Company”),

(the “Participant”)

has been granted an Award under the Plan for Restricted Stock Units (the “Awarded Units”) which may be converted into the number of shares of Common Stock of the Company equal to the number of Restricted Stock Units, subject to the terms and conditions of the Plan and this Restricted Stock Unit Award Agreement (this “Agreement”) and to adjustment in accordance with Section 7 below. The Date of Grant of this Restricted Stock Unit Award is , 200___. Each Awarded Unit shall be a notional share of Common Stock, with the value of each Awarded Unit being equal to the Fair Market Value of a share of Common Stock at any time.

2. Subject to Plan. This Agreement is subject to the terms and conditions of the Plan, and the terms of the Plan shall control to the extent inconsistent with the provisions of this Agreement. The capitalized terms used herein that are defined in the Plan shall have the same meanings assigned to them in the Plan. This Agreement is subject to any rules promulgated pursuant to the Plan by the Board or the Committee and communicated to the Participant in writing.

3. Vesting; Forfeiture. Except as specifically provided in this Agreement and subject to certain restrictions and conditions set forth in the Plan, the Awarded Units shall become vested as follows:

a. one-fourth of the total Awarded Units shall become vested on the first anniversary of the Date of Grant provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

b. one-fourth of the total Awarded Units shall become vested on the second anniversary of the Date of Grant, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

c. one-fourth of the total Awarded Units shall become vested on the third anniversary of the Date of Grant, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

d. one-fourth of the total Awarded Units shall become vested on the fourth anniversary of the Date of Grant, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

Awarded Units which have become vested pursuant to the terms of this Section 3 are collectively referred to herein as “Vested RSUs.” All other Awarded Units are collectively referred to herein as “Unvested RSUs.”

The above vesting schedule shall cease and no Unvested RSUs shall vest upon the Participant’s Termination of Service for any reason whatsoever. Upon the Participant’s Termination of Service, and effective as of 5 p.m. on the Participant’s Termination of Service, the Participant shall be deemed to have forfeited all of the Participant’s Unvested RSUs. Upon any forfeiture, all rights of the Participant with respect to the Unvested RSUs shall cease and terminate, without any further obligation on the part of the Company. Notwithstanding anything else to the contrary herein, upon the occurrence of a Change of Control, all Unvested RSUs shall immediately vest and become Vested RSUs.

4. Conversion of Vested RSUs. Upon the Participant’s Termination of Service or upon a Change of Control, the Awarded Units shall be converted into whole shares of Common Stock equal in number to the Vested RSUs determined in accordance with Section 3 above, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to the date of such Termination of Service or Change of Control.

Such shares of Common Stock shall be distributed to the Participant (or his or her estate or personal representative, as the case may be) within thirty (30) days following the date on which the Participant’s Termination of Service or the Change of Control occurs, as the case may be. From and after the date of receipt of such shares, the Participant (or the Participant’s estate or personal representative, as the case may be) shall have full rights of transfer or resale with respect to such stock subject to applicable state and federal laws and regulations. As used herein, the term Change of Control shall have the meaning provided in the Plan, regardless of any different definition of Change of Control contained in the Participant’s employment agreement with the Company (if any).

Notwithstanding the foregoing provisions of this Section 4, in the event this Award is subject to Section 409A of the Code, then, (i) in lieu of the definition of “Change of Control” specified in the Plan and to the extent necessary to comply with the requirements of Section 409A of the Code, the definition of “Change of Control” for purposes of this Award shall be the definition provided for under Section 409A of the Code and the regulations or other guidance issued thereunder; and (ii) in the case of a distribution on account of any Termination of Service other than death, distribution on behalf of a Participant who is a “specified employee,” as defined in Section 409A of the Code, shall not occur until the date which is the earlier of (x) six (6) months following the date of said Participant’s employment termination, or (y) the date of said Participant’s death.

During the lifetime of the Participant, the Common Stock received upon conversion of Vested RSUs may only be received by the Participant or his or her legal representative. If the Participant dies prior to the date his or her Vested RSUs are converted into shares of Common Stock as described in Section 3 above, the Common Stock relating to such converted Vested RSUs shall be distributed to the Participant’s estate.

In the event of a conflict between the time of vesting of Unvested RSUs or the time of conversion of Vested RSUs in this Agreement and a Participant’s employment agreement with the Company (if any), the terms of this Agreement shall control such timing.

Notwithstanding anything to the contrary in this Agreement, if the Participant’s Termination of Service is as a result of the Company terminating the Participant’s service as an employee for Cause (as defined below), no Awarded Units shall be converted into shares of Common Stock and the Participant’s rights under this Agreement shall immediately terminate and be forfeited, including without limitation any right to receive anything of value from the Company for Vested RSUs. “Cause” shall mean Participant’s (i) conviction by a court of competent jurisdiction of a felony or serious misdemeanor involving moral turpitude; (ii) willful disregard of any written directive of the Board, provided the written directive is not inconsistent with the Certificate of Incorporation or Bylaws of the Company or applicable law; (iii) breach of his or her fiduciary duty under circumstances that involve personal profit; (iv) breach of a material term of his or her employment agreement (if any) with the Company (or one of its Subsidiaries); or (v) neglect of his or her duties that has a material adverse effect on the Company.

5. No Fractional Shares. Vested RSUs may be converted only with respect to full shares, and no fractional share of stock shall be issued.

6. Rights as Shareholder. The Participant will have no rights as a shareholder with respect to any shares covered by this Agreement until the issuance of a certificate or certificates to the Participant upon the conversion of Vested RSUs. The Awarded Units shall be subject to the terms and conditions of this Agreement regarding such shares. Except as otherwise provided in Section 7 hereof, no adjustment shall be made for dividends or other rights for which the record date is prior to the issuance of such certificate or certificates.

7. Adjustment of Number of Awarded Units and Related Matters. The number of Awarded Units shall be subject to adjustment in accordance with Articles 11 - 13 of the Plan.

8. The Participant’s Acknowledgments. The Participant acknowledges receipt of a copy of the Plan, which is annexed hereto, and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts the Awarded Units subject to all the terms and provisions thereof. The Participant hereby agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee or the Board, as appropriate, upon any questions arising under the Plan or this Agreement.

9. Execution of Documents. The Participant, by his or her execution of this Agreement, hereby agrees to execute any documents requested by the Company in connection with the conversion of the Awarded Units into shares of Common Stock pursuant to this Agreement.

10. Community Property. Each spouse individually is bound by, and such spouse’s interest, if any, in any Awarded Units is subject to, the terms of this Agreement. Nothing in this Agreement shall create a community property interest where none otherwise exists.

11. Participant’s Representations. Notwithstanding any of the provisions hereof, the Participant hereby agrees that the Company will not be obligated to issue any shares to the Participant hereunder if the issuance of such shares shall constitute a violation by the Company of any provision of any law or regulation of any governmental authority. Any determination in this connection by the Company shall be final, binding, and conclusive. The obligations of the Company and the rights of the Participant are subject to all applicable laws, rules, and regulations.

acquired by the Participant for investment purposes for his or her own account and not with any intent for resale or distribution in violation of federal or state securities laws. Unless the Common Stock is issued to him or her in a transaction registered under the applicable federal and state securities laws, all certificates issued with respect to the Common Stock shall bear an appropriate restrictive investment legend and shall be held indefinitely, unless they are subsequently registered under the applicable federal and state securities laws or the Participant obtains an opinion of counsel, in form and substance satisfactory to the Company and its counsel, that such registration is not required.

13. Legend. The following legend shall be inserted on a certificate evidencing Common Stock issued upon the conversion of the Awarded Units if the shares were not issued in a transaction registered under the applicable federal and state securities laws:

“SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED BY THE HOLDER FOR INVESTMENT AND NOT FOR RESALE, TRANSFER OR DISTRIBUTION, HAVE BEEN ISSUED PURSUANT TO EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF APPLICABLE STATE AND FEDERAL SECURITIES LAWS, AND MAY NOT BE OFFERED FOR SALE, SOLD OR TRANSFERRED OTHER THAN PURSUANT TO EFFECTIVE REGISTRATION UNDER SUCH LAWS, OR IN TRANSACTIONS OTHERWISE IN COMPLIANCE WITH SUCH LAWS, AND UPON EVIDENCE SATISFACTORY TO THE COMPANY OF COMPLIANCE WITH SUCH LAWS, AS TO WHICH THE COMPANY MAY RELY UPON AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY.”

14. Law Governing. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Delaware (excluding any conflict of laws rule or principle of Delaware law that might refer the governance, construction, or interpretation of this agreement to the laws of another state).

15. No Right to Continue Service or Employment. Nothing herein shall be construed to confer upon the Participant the right to continue in the employ or to provide services to the Company, whether as an employee, board member or as a Consultant, or to interfere with or restrict in any way the right of the Company to discharge the Participant as an employee, board member or Consultant at any time.

16. Legal Construction. In the event that any one or more of the terms, provisions, or agreements that are contained in this Agreement shall be held by a court of competent jurisdiction to be invalid, illegal, or unenforceable in any respect for any reason, the invalid, illegal, or unenforceable term, provision, or agreement shall not affect any other term, provision, or agreement that is contained in this Agreement and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceable term, provision, or agreement had never been contained herein.

17. Covenants and Agreements as Independent Agreements. Each of the covenants and agreements that is set forth in this Agreement shall be construed as a covenant and agreement independent of any other provision of this Agreement. The existence of any claim or cause of action of the Participant against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of the covenants and agreements that are set forth in this Agreement.

18. Entire Agreement. This Agreement together with the Plan supersede any and all other prior understandings and agreements, either oral or in writing, between the parties with respect to the subject matter hereof and constitute the sole and only agreements between the parties with respect to the said subject matter. All prior negotiations and agreements between the parties with respect to the subject matter hereof are merged into this Agreement. Each party to this Agreement acknowledges that no representations, inducements, promises, or agreements, orally or otherwise, have been made by any party or by anyone acting on behalf of any party, which are not embodied in this Agreement or the Plan and that any agreement, statement or promise that is not contained in this Agreement or the Plan shall not be valid or binding or of any force or effect.

19. Counterparts. This Agreement may be executed in separate counterparts, each of which shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

20. Parties Bound. The terms, provisions, and agreements that are contained in this Agreement shall apply to, be binding upon, and inure to the benefit of the parties and their respective heirs, executors, administrators, legal representatives, and permitted successors and assigns, subject to the limitation on assignment expressly set forth herein.

21. Modification. No change or modification of this Agreement shall be valid or binding upon the parties unless the change or modification is in writing and signed by the parties; provided, however, that the Company may change or modify this Agreement without the Participant’s consent or signature if the Company determines, in its sole discretion, that such change or modification is necessary for purposes of compliance with or exemption from the requirements of Section 409A of the Code or any regulations or other guidance issued thereunder.

22. Headings. The headings that are used in this Agreement are used for reference and convenience purposes only and do not constitute substantive matters to be considered in construing the terms and provisions of this Agreement.

23. Gender and Number. Words of any gender used in this Agreement shall be held and construed to include any other gender, and words in the singular number shall be held to include the plural, and vice versa, unless the context requires otherwise.

24. Notice. Any notice required or permitted to be delivered hereunder shall be deemed to be delivered only when actually received by the Company or by the Participant, as the case may be, at the addresses set forth below, or at such other addresses as they have theretofore specified by written notice delivered in accordance herewith:

a. Notice to the Company shall be addressed and delivered as follows:

Kitty Hawk
P.O. Box 612787
1515 West 20^th Street — 2^nd Floor
DFW International Airport, TX 75261
Attn: Stock Plan Administrator
Facsimile: (972) 456-2449

With a copy to the Secretary of the Company.

b. Notice to the Participant shall be addressed and delivered as set forth on the signature page.

25. Tax Requirements. The Participant is hereby advised to consult immediately with his or her own tax advisor regarding the tax consequences of this Agreement. Unless the Company otherwise consents in writing to an alternative withholding method, if the Participant is an employee of the Company, the Company shall withhold the number of shares to be delivered upon the conversion of the Vested RSUs with an aggregate Fair Market Value that equals (but does not exceed) the amount of any Federal, state, local, or other taxes required by law to be withheld in connection with this Award. The Company, in its sole discretion and prior to the date of conversion, may also permit the Participant receiving shares of Common Stock upon conversion of Vested RSUs to pay the Company the amount of any taxes that the Company is required to withhold in connection with the Participant’s income arising with respect to this Award. Such payments shall be required to be made prior to the delivery of any certificate representing shares of Common Stock. Such payment, if the Company, in its sole discretion, so consents in writing, may be made (i) by the delivery of cash to the Company in an amount that equals or exceeds the required tax withholding obligations of the Company; (ii) if the Company, in its sole discretion, so consents in writing, the actual delivery by the Participant to the Company of shares of Common Stock other than (A) Restricted Stock or (B) Common Stock that the Participant has not acquired from the Company within six (6) months prior to the date of exercise, which shares so delivered have an aggregate Fair Market Value that equals or exceeds the required tax withholding payment; or (iii) any combination of (i) or (ii). The Company also may, in its sole discretion, withhold any such taxes from any other cash remuneration otherwise paid by the Company to the Participant.

* * * * *

IN WITNESS WHEREOF, the Company has caused this Restricted Stock Unit Award Agreement to be executed by its duly authorized officer, and the Participant, to evidence his or her consent and approval of all the terms hereof, has duly executed this Restricted Stock Unit Award Agreement, as of the date specified in Section 1 hereof.


		COMPANY:


		By:

		Name:

		Title:



		PARTICIPANT:




		Signature

		Name:

		Address:

EX-10.2 3 d29198exv10w2.htm FORM OF OUTSIDE DIRECTOR RESTRICTED STOCK UNIT AWARD AGREEMENT exv10w2

Exhibit 10.2

RESTRICTED STOCK UNIT AWARD AGREEMENT
UNDER THE KITTY HAWK
2003 LONG-TERM EQUITY INCENTIVE PLAN

(the “Participant”)

3. Vesting; Forfeiture. Except as specifically provided in this Agreement and subject to certain restrictions and conditions set forth in the Plan, the Awarded Units shall become vested as follows:

a. one-fourth of the total Awarded Units shall become vested on the three month anniversary of the Date of Grant provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

b. one-fourth of the total Awarded Units shall become vested on the six month anniversary of the Date of Grant, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

c. one-fourth of the total Awarded Units shall become vested on the nine month anniversary of the Date of Grant, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

d. one-fourth of the total Awarded Units shall become vested on the one year anniversary of the Date of Grant, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to such date.

4. Conversion of Vested RSUs. Upon the earlier to occur of (i) Participant’s Termination of Service, (ii) a Change of Control or (iii) the four year anniversary of the Date of Grant (the “Conversion Date”), the Awarded Units shall be converted into whole shares of Common Stock equal in number to the Vested RSUs determined in accordance with Section 3 above, provided the Participant is employed by (or, if the Participant is a Consultant or Outside Director, is providing services to) the Company from the Date of Grant to the date of such Termination of Service, Change of Control or Conversion Date.

Notwithstanding the foregoing, the Participant may make an election pursuant to the provisions of this Agreement to defer the conversion of the Awarded Units for an additional period after the original Conversion Date therefor (“Second Election”). Such a Second Election shall be made at least twelve (12) months prior to the original Conversion Date and shall defer the original Conversion Date set forth in Section 4(iii) above for not less than five (5) years after such original Conversion Date. A Second Election shall be by a written notice sent by the Participant to the Company in a form approved by the Company.

Such shares of Common Stock shall be distributed to the Participant (or his or her estate or personal representative, as the case may be) within thirty (30) days following the date on which the Participant’s Termination of Service, Change of Control or Conversion Date occurs, as the case may be. From and after the date of receipt of such shares, the Participant (or the Participant’s estate or personal representative, as the case may be) shall have full rights of transfer or resale with respect to such stock subject to applicable state and federal laws and regulations. As used herein, the term Change of Control shall have the meaning provided in the Plan, regardless of any different definition of Change of Control contained in the Participant’s employment agreement with the Company (if any).

5. No Fractional Shares. Vested RSUs may be converted only with respect to full shares, and no fractional share of stock shall be issued.

7. Adjustment of Number of Awarded Units and Related Matters. The number of Awarded Units shall be subject to adjustment in accordance with Articles 11 - 13 of the Plan.

12. Investment Representation. Unless the Common Stock is issued to him or her in a transaction registered under applicable federal and state securities laws, by his or her execution hereof, the Participant represents and warrants to the Company that all Common Stock issued hereunder will be acquired by the Participant for investment purposes for his or her own account and not with any intent for resale or distribution in violation of federal or state securities laws. Unless the Common Stock is issued to him or her in a transaction registered under the applicable federal and state securities laws, all certificates issued with respect to the Common Stock shall bear an appropriate restrictive investment legend and shall be held indefinitely, unless they are subsequently registered under the applicable federal and state securities laws or the Participant obtains an opinion of counsel, in form and substance satisfactory to the Company and its counsel, that such registration is not required.

15. No Right to Continue Service or Employment. Nothing herein shall be construed to confer upon the Participant the right to continue in the employ or to provide services to the Company, whether as an employee, a board member or as a Consultant, or to interfere with or restrict in any way the right of the Company to discharge the Participant as an employee, a board member or Consultant at any time.

Agreement and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceable term, provision, or agreement had never been contained herein.

19. Counterparts. This Agreement may be executed in separate counterparts, each of which shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

a. Notice to the Company shall be addressed and delivered as follows:

Kitty Hawk
P.O. Box 612787
1515 West 20^th Street — 2^nd Floor
DFW International Airport, TX 75261
Attn: Stock Plan Administrator
Facsimile: (972) 456-2449

With a copy to the Secretary of the Company.

b. Notice to the Participant shall be addressed and delivered as set forth on the signature page.

* * * * *


		COMPANY:


		By:

		Name:

		Title:



		PARTICIPANT:




		Signature

		Name:

		Address:

EX-10.3 4 d29198exv10w3.htm FORM OF EMPLOYEE INCENTIVE STOCK OPTION AGREEMENT exv10w3

Exhibit 10.3

FORM OF
INCENTIVE STOCK OPTION AGREEMENT

KITTY HAWK 2003 LONG TERM EQUITY INCENTIVE PLAN

1. Grant of Option. Pursuant to the Kitty Hawk 2003 Long Term Equity Incentive Plan (the “Plan”) for Employees, Consultants and Outside Directors of Kitty Hawk, Inc., a Delaware Corporation (the “Company”), and its Subsidiaries, the Company grants to

(the “Participant”),

who is an Employee of the Company, an option to purchase shares of Common Stock of the Company as follows:

On the date hereof, the Company grants to the Participant an option (the “Option” or “Stock Option”) to purchase (___) full shares (the “Optioned Shares”) of Common Stock at an Option Price equal to $___ per share. The Date of Grant of this Stock Option is .

The “Award Period” shall commence on the Date of Grant and shall expire on the date immediately preceding the tenth (10^th) anniversary of the Date of Grant (or the date immediately preceding the fifth (5^th) anniversary of the Date of Grant, in the case of a ten percent (10%) or more stockholder as provided in Code Section 422). The Stock Option is intended to be an Incentive Stock Option.

2. Subject to Plan. The Stock Option and its exercise are subject to the terms and conditions of the Plan, and the terms of the Plan shall control. The capitalized terms used herein that are defined in the Plan shall have the same meanings assigned to them in the Plan. The Stock Option is subject to any rules promulgated pursuant to the Plan by the Board or the Committee and communicated to the Participant in writing.

3. Vesting; Time of Exercise; Holding Period.

a. Except as specifically provided in this Award Agreement (this “Agreement”), and subject to certain restrictions and conditions set forth in the Plan, the Stock Option shall be fully exercisable on the Date of Grant;

b. Except as specifically provided in this Agreement and subject to certain restrictions and conditions set forth in the Plan, the Optioned Shares shall vest in three equal annual installments, with the first installment vesting on the anniversary of the date of the grant of the Stock Option ( ) and each subsequent installment vesting on each successive .

In the event that a Change of Control occurs, then upon the effective date of such Change of Control, provided the Participant is employed by (or, if the Participant is a Consultant, is providing services to) the Company or a Subsidiary from the Date of Grant to the date of such Change of Control, the total Optioned Shares not previously vested shall thereupon immediately become fully vested. In the event of a conflict between (i) the definition of a Change of Control in the Plan and in the Participant’s employment agreement with the Company (if any) or (ii) the time of acceleration of a Participant’s Optioned Shares under this Agreement, any prior option agreement of the Participant with the Company or the Plan and under the Participant’s employment agreement with the Company (if any), the terms of the Participant’s employment agreement shall control.

c. If the Optioned Shares received upon exercise of this Stock Option are not fully vested as described in Section 3.b. above at the time of exercise of the Stock Option, the unvested Optioned Shares issued to the Participant shall be Restricted Stock, subject to the conditions of Section 6.5(a) and (b) of the Plan. The Restriction Period for such Restricted Stock shall commence on the date of exercise and shall expire on the date the Optioned Shares otherwise would vest as described in Section 3.b. above.

Upon the issuance to Participant of a certificate for Restricted Stock, Participant shall endorse such certificate in blank or execute a stock power in form satisfactory to the Company in blank and deliver such certificate and executed stock power to the Company. The provisions of this paragraph shall be specifically performable by the Company in a court of equity or law.

In the event of the Participant’s Termination of Service prior to the end of the Restriction Period, any shares of Restricted Stock shall be forfeited pursuant to the terms of this Agreement and the Company may, in its sole discretion, elect to repurchase the Restricted Stock by paying, as soon as practicable after the event causing forfeiture of such shares (but in any event within five (5) business days after such event), cash, in an amount equal to the lesser of (i) the total consideration paid by the Participant for such forfeited shares or (ii) the Fair Market Value of such forfeited shares as of the date of such event. If the Company elects not to repurchase the Restricted Stock upon forfeiture, the Participant shall retain such Restricted Stock free of restriction under the Plan.

4. Term; Forfeiture.

a. Except as otherwise provided in this Agreement, to the extent the unexercised portion of the Stock Option relates to Optioned Shares which are not vested on the date of the Participant’s Termination of Service, the Stock Option will be terminated on that date. The unexercised portion of the Stock Option that relates to Optioned Shares which are vested will terminate and be forfeited at the first of the following to occur:

i. 5 p.m. on the date the Award Period terminates;

ii. 5 p.m. on the date which is 365 days following the date of the Participant’s Termination of Service due to death or Total and Permanent Disability;

iii. immediately upon the Participant’s Termination of Service by the Company (or a Subsidiary) for Cause (as defined herein);

iv. 5 p.m. on the date which is 90 days following the date of the Participant’s Termination of Service for any reason other than due to Participant’s death or Total and Permanent Disability or by the Company (or a Subsidiary) for Cause; or

v. 5 p.m. on the date the Company causes any portion of the Option to be forfeited pursuant to Section 7 hereof.

“Cause” shall mean Participant’s:

i. conviction by a court of competent jurisdiction of a felony or serious misdemeanor involving moral turpitude;

ii. willful disregard of any written directive of the Board, provided the written directive is not inconsistent with the Certificate of Incorporation or Bylaws of the Company or applicable law;

iii. breach of his or her fiduciary duty under circumstances that involve personal profit;

iv. breach of a material term of his or her employment agreement (if any) with the Company (or one of its Subsidiaries); or

v. neglect of his or her duties that has a material adverse effect on the Company.

5. Who May Exercise. Subject to the terms and conditions set forth in Sections 3 and 4 above, during the lifetime of the Participant, the Stock Option may be exercised only by the Participant, or by the Participant’s guardian or personal or legal representative. If the Participant’s Termination of Service is due to his death prior to the date specified in Section 4.a.i. hereof, or Participant dies prior to the termination dates specified in Section 4.a. hereof, and the Participant has not exercised the Stock Option as to the maximum number of vested Optioned Shares as set forth in Section 3 hereof as of the date of death, the following persons may exercise the vested portion of the Stock Option on behalf of the Participant at any time prior to the earliest of the dates specified in Section 4 hereof: the personal representative of his estate, or the person who acquired the right to exercise the Stock Option by bequest or inheritance or by reason of the death of the Participant; provided that the Stock Option shall remain subject to the other terms of this Agreement, the Plan, and applicable laws, rules, and regulations.

6. No Fractional Shares. The Stock Option may be exercised only with respect to full shares, and no fractional share of stock shall be issued.

7. Manner of Exercise. Subject to such administrative regulations as the Committee may from time to time adopt, the Stock Option may be exercised by the delivery of written notice to the Committee setting forth the number of shares of Common Stock with respect to which the Stock Option is to be exercised, the date of exercise thereof (the “Exercise Date”) which shall be at least one (1) day after giving such notice unless an earlier time shall have been mutually agreed upon, and whether the Optioned Shares to be exercised will be considered as deemed granted under an Incentive Stock Option as provided in Section 12. On the Exercise Date, the Participant shall deliver to the Company consideration with a value equal to the total Option Price of the shares to be purchased, payable as follows: (a) cash, check, bank draft, or money order payable to the order of the Company, (b) Common Stock or Restricted Stock (with the prior approval of the Committee) owned by the Participant on the Exercise Date, valued at its Fair Market Value on the Exercise Date, and which the Participant has not acquired from the Company within six (6) months prior to the Exercise Date, and/or (c) in any other form of valid consideration that is acceptable to the Committee in its sole discretion; provided, however, that if the Option Price is paid in Restricted Stock, the stock received by the Participant pursuant to such exercise shall also be Restricted Stock.

Upon payment of all amounts due from the Participant, the Company shall cause certificates for the Optioned Shares then being purchased to be delivered to the Participant (or the person exercising the Participant’s Stock Option in the event of his death) at its principal business office within five (5) business days after the Exercise Date. In no event may the Stock Option be exercised or shares of Common Stock be issued pursuant to this Stock Option if the exercise or the issuance thereof would violate applicable law or the rules or regulations of a stock exchange or inter-dealer quotation system on which the shares of Common Stock are then listed or quoted.

If the Participant fails to pay for any of the Optioned Shares specified in such notice or fails to accept delivery thereof, then the Stock Option, and right to purchase such Optioned Shares may be forfeited at the sole discretion of the Company.

8. Tax Requirements. Subject to Section 8.6 of the Plan, the Company or, if applicable, any Subsidiary (for purposes of this Section 8, the term “Company” shall be deemed to include any applicable Subsidiary), shall have the right to deduct from all amounts hereunder paid in cash or other form, any Federal, state, local, or other taxes required by law to be withheld in connection with this Award. The Participant may pay the Company the amount of any taxes that the Company is required to withhold in connection with the Participant’s income arising with respect to this Award. Such payment may be made (i) by the delivery of cash to the Company in an amount that equals or exceeds (to avoid the issuance of fractional shares under (iii) below) the required tax withholding obligations of the Company; (ii) if the Company, in its sole discretion, so consents in writing, the actual delivery by the exercising Participant to the Company of shares of Common Stock other than (A) Restricted Stock, or (B) Common Stock that the Participant has not acquired from the Company within six (6) months prior to the date of exercise, which shares so delivered have an aggregate Fair Market Value that equals or exceeds (to avoid the issuance of fractional shares under (iii) below) the

required tax withholding payment; (iii) if the Company, in its sole discretion, so consents in writing, the Company’s withholding of a number of shares to be delivered upon the exercise of the Stock Option other than shares that will constitute Restricted Stock, which shares so withheld have an aggregate fair market value that equals (but does not exceed) the required tax withholding payment; or (iv) any combination of (i), (ii), or (iii). The Company may, with the consent of the Participant, withhold any such taxes from any other cash remuneration otherwise paid by the Company to the Participant.

9. Nonassignability. This Stock Option may not be transferred, assigned, pledged, hypothecated or otherwise conveyed or encumbered other than by will or the laws of descent and distribution.

10. Rights as Stockholder. The Participant will have no rights as a stockholder with respect to any shares covered by the Stock Option until the issuance of a certificate or certificates to the Participant for the Optioned Shares. The Optioned Shares shall be subject to the terms and conditions of this Agreement regarding such Optioned Shares. Except as otherwise provided in Section 11 hereof, no adjustment shall be made for dividends or other rights for which the record date is prior to the issuance of such certificate or certificates.

11. Adjustment of Number of Optioned Shares and Related Matters. The number of shares of Common Stock covered by the Stock Option, and the Option Prices thereof, shall be subject to adjustment in accordance with Articles 11 - 13 of the Plan.

12. Incentive Stock Option. Subject to the provisions of the Plan, this Stock Option is an Incentive Stock Option. To the extent the number of Optioned Shares exceeds the limit set forth in Section 6.4 of the Plan, such Optioned Shares shall be deemed granted pursuant to a Nonqualified Stock Option. Unless otherwise indicated by the Participant in the notice of exercise pursuant to Article 8 of the Plan, upon any exercise of this Stock Option, the number of exercised Optioned Shares that shall be deemed to be exercised pursuant to an Incentive Stock Option shall equal the total number of Optioned Shares so exercised multiplied by a fraction, (i) the numerator of which is the number of unexercised Optioned Shares that could then be exercised pursuant to an Incentive Stock Option and (ii) the denominator of which is the then total number of unexercised Optioned Shares.

13. Disqualifying Disposition. In the event that Common Stock acquired upon exercise of this Stock Option is disposed of by the Participant in a “Disqualifying Disposition,” such Participant shall notify the Company in writing within thirty (30) days after such disposition of the date and terms of such disposition. For purposes hereof, “Disqualifying Disposition” shall mean a disposition of Common Stock that is acquired upon the exercise of this Stock Option (and that is not deemed granted pursuant to a Nonqualified Stock Option under Section 12) prior to the expiration of either two years from the Date of Grant of this Stock Option or one year from the transfer of shares to the Participant pursuant to the exercise of this Stock Option.

14. Participant’s Representations. Notwithstanding any of the provisions hereof, the Participant hereby agrees that he will not exercise the Stock Option granted hereby, and that the

Company will not be obligated to issue any shares to the Participant hereunder, if the exercise thereof or the issuance of such shares shall constitute a violation by the Participant or the Company of any provision of any law, regulation of any governmental authority or rule or regulation of any stock exchange or quotation service on which the Common Stock is then listed or quoted. Any determination in this connection by the Company shall be final, binding, and conclusive. The obligations of the Company and the rights of the Participant are subject to all applicable laws, rules, and regulations.

15. Investment Representation. Unless the Common Stock is issued to him or her in a transaction registered under applicable federal and state securities laws, by his or her execution hereof, the Participant represents and warrants to the Company that all Common Stock which may be purchased hereunder will be acquired by the Participant for investment purposes for his or her own account and not with any intent for resale or distribution in violation of federal or state securities laws. Unless the Common Stock is issued to him in a transaction registered under the applicable federal and state securities laws, all certificates issued with respect to the Common Stock shall bear an appropriate restrictive investment legend and shall be held indefinitely, unless they are subsequently registered under the applicable federal and state securities laws or the Participant obtains an opinion of counsel, in form and substance satisfactory to the Company and its counsel, that such registration is not required.

16. Participant’s Acknowledgments. The Participant acknowledges receipt of a copy of the Plan, which is annexed hereto, and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Option subject to all the terms and provisions thereof. The Participant hereby agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee or the Board, as appropriate, upon any questions arising under the Plan or this Agreement.

17. Law Governing. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Delaware (excluding any conflict of laws rule or principle of Delaware law that might refer the governance, construction, or interpretation of this agreement to the laws of another state).

18. No Right to Continue Service or Employment. Nothing herein shall be construed to confer upon the Participant the right to continue in the employ or to provide services to the Company or any Subsidiary, whether as an employee or as a consultant, or interfere with or restrict in any way the right of the Company or any Subsidiary to discharge the Participant as an employee or consultant at any time.

19. Legal Construction. In the event that any one or more of the terms, provisions, or agreements that are contained in this Agreement shall be held by a Court of competent jurisdiction to be invalid, illegal, or unenforceable in any respect for any reason, the invalid, illegal, or unenforceable term, provision, or agreement shall not affect any other term, provision, or agreement that is contained in this Agreement and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceable term, provision, or agreement had never been contained herein.

20. Covenants and Agreements as Independent Agreements. Each of the covenants and agreements that is set forth in this Agreement shall be construed as a covenant and agreement independent of any other provision of this Agreement. The existence of any claim or cause of action of the Participant against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of the covenants and agreements that are set forth in this Agreement.

21. Entire Agreement. This Agreement together with the Plan supersede any and all other prior understandings and agreements, either oral or in writing, between the parties with respect to the subject matter hereof and constitute the sole and only agreements between the parties with respect to the said subject matter. All prior negotiations and agreements between the parties with respect to the subject matter hereof are merged into this Agreement. Each party to this Agreement acknowledges that no representations, inducements, promises, or agreements, orally or otherwise, have been made by any party or by anyone acting on behalf of any party, which are not embodied in this Agreement or the Plan and that any agreement, statement or promise that is not contained in this Agreement or the Plan shall not be valid or binding or of any force or effect.

22. Parties Bound. The terms, provisions, and agreements that are contained in this Agreement shall apply to, be binding upon, and inure to the benefit of the parties and their respective heirs, executors, administrators, legal representatives, and permitted successors and assigns, subject to the limitation on assignment expressly set forth herein.

23. Modification. No change or modification of this Agreement shall be valid or binding upon the parties unless the change or modification is in writing and signed by the parties. Notwithstanding the preceding sentence, the Company may amend the Plan or revoke this Stock Option to the extent permitted by the Plan.

24. Headings. The headings that are used in this Agreement are used for reference and convenience purposes only and do not constitute substantive matters to be considered in construing the terms and provisions of this Agreement.

25. Gender and Number. Words of any gender used in this Agreement shall be held and construed to include any other gender, and words in the singular number shall be held to include the plural, and vice versa, unless the context requires otherwise.

26. Notice. Any notice required or permitted to be delivered hereunder shall be deemed to be delivered only when actually received by the Company or by the Participant, as the case may be, at the addresses set forth below, or at such other addresses as they have theretofore specified by written notice delivered in accordance herewith:

a. Notice to the Company must be addressed and delivered as follows:

Kitty Hawk, Inc.
P.O. Box 612787
1515 West 20th St. — 2nd Floor
DFW International Airport, TX 75261
Attn: Stock Plan Administrator
Facsimile: (972) 456-2449

With a copy to the Secretary of the Company

b. Notice to the Participant shall be addressed and delivered as set forth on the signature page.

* * * * * * * *

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly authorized officer, and the Participant, to evidence his consent and approval of all the terms hereof, has duly executed this Agreement, as of the date specified in Section 1 hereof.


		COMPANY:


		By:

		Name:

		Title:



		PARTICIPANT:




		Signature

		Name:

		Address:

EX-10.4 5 d29198exv10w4.htm FORM OF EMPLOYEE NON-QUALIFIED STOCK OPTION AGREEMENT exv10w4

Exhibit 10.4

FORM OF
NONQUALIFIED STOCK OPTION AGREEMENT

KITTY HAWK 2003 LONG TERM EQUITY INCENTIVE PLAN

(the “Participant”),

an option to purchase shares of Common Stock of the Company as follows:

On the date hereof, the Company grants to the Participant an option (the “Option” or “Stock Option”) to purchase (___) full shares (the “Optioned Shares”) of Common Stock at an Option Price equal to $ per share. The Date of Grant of this Stock Option is .

The “Award Period” shall commence on the Date of Grant and shall expire on the date immediately preceding the tenth (10^th) anniversary of the Date of Grant. The Stock Option is a Nonqualified Stock Option.

3. Vesting; Time of Exercise; Holding Period.

In the event that a Change of Control occurs, then upon the effective date of such Change of Control, provided the Participant is employed by (or, if the Participant is a

Consultant, is providing services to) the Company or a Subsidiary from the Date of Grant to the date of such Change of Control, the total Optioned Shares not previously vested shall thereupon immediately become fully vested. In the event of a conflict between (i) the definition of a Change of Control in the Plan and in the Participant’s employment agreement with the Company (if any) or (ii) the time of acceleration of a Participant’s Optioned Shares under this Agreement, any prior option agreement of the Participant with the Company or the Plan and under the Participant’s employment agreement with the Company (if any), the terms of the Participant’s employment agreement shall control.

In the event of the Participant’s Termination of Service prior to the end of the Restriction Period, any shares of Restricted Stock for which the Restriction Period has not expired shall be forfeited pursuant to the terms of this Agreement and the Company may, in its sole discretion, elect to repurchase the Restricted Stock by paying, as soon as practicable after the event causing forfeiture of such shares (but in any event within five (5) business days after such event), cash, in an amount equal to the lesser of (i) the total consideration paid by the Participant for such forfeited shares or (ii) the Fair Market Value of such forfeited shares as of the date of such event. If the Company elects not to repurchase the Restricted Stock upon forfeiture, the Participant shall retain such Restricted Stock free of restriction under the Plan.

4. Term; Forfeiture.

i. 5 p.m. on the date the Award Period terminates;

ii. 5 p.m. on the date which is 365 days following the date of the Participant’s Termination of Service due to death or Total and Permanent Disability;

iii. immediately upon the Participant’s Termination of Service by the Company (or a Subsidiary) for Cause (as defined herein);

iv. 5 p.m. on the date which is 3 years following the date of the Participant’s Termination of Service by the Participant for Retirement;

v. 5 p.m. on the date which is 90 days following the date of the Participant’s Termination of Service by the Company (or a Subsidiary) without Cause or by the Participant with or without the consent of the Company, other than by reason of Retirement; or

vi. 5 p.m. on the date the Company causes any portion of the Option to be forfeited pursuant to Section 7 hereof.

“Cause” shall mean Participant’s:

i. conviction by a court of competent jurisdiction of a felony or serious misdemeanor involving moral turpitude;

ii. willful disregard of any written directive of the Board, provided the written directive is not inconsistent with the Certificate of Incorporation or Bylaws of the Company or applicable law;

iii. breach of his or her fiduciary duty under circumstances that involve personal profit;

iv. breach of a material term of his or her employment agreement (if any) with the Company (or one of its Subsidiaries); or

v. neglect of his or her duties that has a material adverse effect on the Company.

6. No Fractional Shares. The Stock Option may be exercised only with respect to full shares, and no fractional share of stock shall be issued.

7. Manner of Exercise. Subject to such administrative regulations as the Committee may from time to time adopt, the Stock Option may be exercised by the delivery of written notice to the Committee setting forth the number of shares of Common Stock with respect to which the Stock Option is to be exercised, the date of exercise thereof (the “Exercise Date”) which shall be at least one (1) day after giving such notice unless an earlier time shall have been mutually agreed upon. On the Exercise Date, the Participant shall deliver to the Company consideration with a value equal to the total Option Price of the shares to be purchased, payable as follows: (a) cash, check, bank draft, or money order payable to the order of the Company, (b) Common Stock or Restricted Stock (with the prior approval of the Committee) owned by the Participant on the Exercise Date, valued at its Fair Market Value on the Exercise Date, and which the Participant has not acquired from the Company within six (6) months prior to the Exercise Date, and/or (c) in any other form of valid consideration that is acceptable to the Committee in its sole discretion; provided, however, that if the Option Price is paid in Restricted Stock, the stock received by the Participant pursuant to such exercise shall also be Restricted Stock.

the Company’s withholding of a number of shares to be delivered upon the exercise of the Stock Option other than shares that will constitute Restricted Stock, which shares so withheld have an aggregate fair market value that equals (but does not exceed) the required tax withholding payment; or (iv) any combination of (i), (ii), or (iii). The Company may, with the consent of the Participant, withhold any such taxes from any other cash remuneration otherwise paid by the Company to the Participant.

9. Nonassignability. Except as otherwise provided herein, this Stock Option may not be transferred, assigned, pledged, hypothecated or otherwise conveyed or encumbered other than by will or the laws of descent and distribution and may be exercised during the lifetime of the Participant only by the Participant or the Participant’s legally authorized representative.

The vested portion of this Stock Option may be transferred by the Participant to (i) the spouse (or former spouse), children or grandchildren of the Participant (“Immediate Family Members”), (ii) a trust or trusts for the exclusive benefit of such Immediate Family Members, (iii) a partnership in which the only partners are (1) such Immediate Family Members and/or (2) entities which are controlled by Immediate Family Members, (iv) an entity exempt from federal income tax pursuant to Section 501(c)(3) of the Code or any successor provision, or (v) a split interest trust or pooled income fund described in Section 2522(c)(2) of the Code or any successor provision; provided that (x) there shall be no consideration for any such transfer; (y) subsequent transfers of this Stock Option shall be prohibited, except those by will or the laws of descent and distribution, and (z) the forfeiture provisions provided for in the Plan and this Agreement shall continue as if this Stock Option had not been transferred.

12. Nonqualified Stock Option. The Stock Option shall not be treated as an Incentive Stock Option.

13. Participant’s Representations. Notwithstanding any of the provisions hereof, the Participant hereby agrees that he will not exercise the Stock Option granted hereby, and that the Company will not be obligated to issue any shares to the Participant hereunder, if the exercise thereof or the issuance of such shares shall constitute a violation by the Participant or the Company of any provision of any law, regulation of any governmental authority or rule or regulation of any stock exchange or quotation service on which the Common Stock is then listed or quoted. Any determination in this connection by the Company shall be final, binding, and conclusive. The obligations of the Company and the rights of the Participant are subject to all applicable laws, rules, and regulations.

14. Investment Representation. Unless the Common Stock is issued to him or her in a transaction registered under applicable federal and state securities laws, by his or her execution hereof, the Participant represents and warrants to the Company that all Common Stock which may be purchased hereunder will be acquired by the Participant for investment purposes for his or her own account and not with any intent for resale or distribution in violation of federal or state securities laws. Unless the Common Stock is issued to him in a transaction registered under the applicable federal and state securities laws, all certificates issued with respect to the Common Stock shall bear an appropriate restrictive investment legend and shall be held indefinitely, unless they are subsequently registered under the applicable federal and state securities laws or the Participant obtains an opinion of counsel, in form and substance satisfactory to the Company and its counsel, that such registration is not required.

15. Participant’s Acknowledgments. The Participant acknowledges receipt of a copy of the Plan, which is annexed hereto, and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Option subject to all the terms and provisions thereof. The Participant hereby agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee or the Board, as appropriate, upon any questions arising under the Plan or this Agreement.

16. Law Governing. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Delaware (excluding any conflict of laws rule or principle of Delaware law that might refer the governance, construction, or interpretation of this agreement to the laws of another state).

17. No Right to Continue Service or Employment. Nothing herein shall be construed to confer upon the Participant the right to continue in the employ or to provide services to the Company or any Subsidiary, whether as an employee or as a consultant, or interfere with or restrict in any way the right of the Company or any Subsidiary to discharge the Participant as an employee or consultant at any time.

18. Legal Construction. In the event that any one or more of the terms, provisions, or agreements that are contained in this Agreement shall be held by a Court of competent jurisdiction to be invalid, illegal, or unenforceable in any respect for any reason, the invalid, illegal, or unenforceable term, provision, or agreement shall not affect any other term, provision, or agreement that is contained in this Agreement and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceable term, provision, or agreement had never been contained herein.

19. Covenants and Agreements as Independent Agreements. Each of the covenants and agreements that is set forth in this Agreement shall be construed as a covenant and agreement independent of any other provision of this Agreement. The existence of any claim or cause of action of the Participant against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of the covenants and agreements that are set forth in this Agreement.

20. Entire Agreement. This Agreement together with the Plan supersede any and all other prior understandings and agreements, either oral or in writing, between the parties with respect to the subject matter hereof and constitute the sole and only agreements between the parties with respect to the said subject matter. All prior negotiations and agreements between the parties with respect to the subject matter hereof are merged into this Agreement. Each party to this Agreement acknowledges that no representations, inducements, promises, or agreements, orally or otherwise, have been made by any party or by anyone acting on behalf of any party, which are not embodied in this Agreement or the Plan and that any agreement, statement or promise that is not contained in this Agreement or the Plan shall not be valid or binding or of any force or effect.

21. Parties Bound. The terms, provisions, and agreements that are contained in this Agreement shall apply to, be binding upon, and inure to the benefit of the parties and their respective heirs, executors, administrators, legal representatives, and permitted successors and assigns, subject to the limitation on assignment expressly set forth herein.

22. Modification. No change or modification of this Agreement shall be valid or binding upon the parties unless the change or modification is in writing and signed by the parties. Notwithstanding the preceding sentence, the Company may amend the Plan or revoke this Stock Option to the extent permitted by the Plan.

23. Headings. The headings that are used in this Agreement are used for reference and convenience purposes only and do not constitute substantive matters to be considered in construing the terms and provisions of this Agreement.

24. Gender and Number. Words of any gender used in this Agreement shall be held and construed to include any other gender, and words in the singular number shall be held to include the plural, and vice versa, unless the context requires otherwise.

25. Notice. Any notice required or permitted to be delivered hereunder shall be deemed to be delivered only when actually received by the Company or by the Participant, as the case may be, at the addresses set forth below, or at such other addresses as they have theretofore specified by written notice delivered in accordance herewith:

a. Notice to the Company must be addressed and delivered as follows:

Kitty Hawk, Inc.
P.O. Box 612787
1515 West 20th St. — 2nd Floor
DFW International Airport, TX 75261
Attn: Stock Plan Administrator
Facsimile: (972) 456-2449

With a copy to the Secretary of the Company

b. Notice to the Participant shall be addressed and delivered as set forth on the signature page.

* * * * * * * *


		COMPANY:


		By:

		Name:

		Title:



		PARTICIPANT:




		Signature

		Name:

		Address:

EX-10.5 6 d29198exv10w5.htm AMENDMENT TO THE 2003 LONG-TERM EQUITY INCENTIVE PLAN exv10w5

Exhibit 10.5

AMENDMENT NUMBER TWO
TO THE KITTY HAWK
2003 LONG TERM EQUITY INCENTIVE PLAN

THIS AMENDMENT TO THE KITTY HAWK 2003 LONG TERM EQUITY INCENTIVE PLAN (this “Amendment”), dated as of September 30, 2005, is made and entered into by Kitty Hawk, Inc., a Delaware corporation (the “Company”). Terms used in this Amendment with initial capital letters that are not otherwise defined herein shall have the meanings ascribed to such terms in the Kitty Hawk 2003 Long Term Equity Incentive Plan (the “Plan”).

RECITALS

WHEREAS, Section 6.8 of the Plan provides for automatic stock option grants to Outside Directors; and

WHEREAS, the Board of Directors of the Company (the “Board”) desires to amend the Plan to delete Section 6.8(a) of the Plan, which granted Stock Options to Outside Directors as of the date of the Plan; and

WHEREAS, the Board desires to amend the Plan to delete Section 6.8(b) of the Plan, which granted Stock Options to Outside Directors who joined the Board before September 30, 2005; and

WHEREAS, the Board desires to amend and restate Section 6.8(c) of the Plan, which grants an Award to each Outside Director on September 30, 2005 and on each anniversary of September 30, 2005, to increase the value of the Award from $15,000 to $28,750 and to change the vesting schedule from 12 equal monthly installments with the first installment vesting on the one month anniversary of the Award’s grant date, to four quarterly installments with the first installment vesting on the three month anniversary of the Award’s grant date; and

WHEREAS, the Board desires to amend and restate Section 6.8(d) of the Plan to delete the provision that provides dates when the unexercised portion of a Stock Option which is vested will terminate and be forfeited in the event of a Termination of Service of an Outside Director; and

WHEREAS, the Board desires to amend and restate Section 8.6 of the Plan to eliminate the reimbursement of taxes for Outside Directors for periods of service commencing on or after September 30, 2005; and

WHEREAS, Article 9 of the Plan provides that the Board has the authority to amend the Plan without the consent of the Participants; and

WHEREAS, the Board has approved the proposal to amend the Plan;

NOW, THEREFORE, the Company hereby amends the Plan as follows:

1. The heading of Section 6.8 is hereby amended from “Automatic Stock Option Grants to Outside Directors” to state “Automatic Award Grants to Outside Directors.”

2. Section 6.8(a) of the Plan is hereby deleted in its entirety.

3. Section 6.8(b) of the Plan is hereby deleted in its entirety.

4. Section 6.8(c) of the Plan is hereby amended by deleting such Section and substituting in lieu thereof the following:

(a) On September 30, 2005, and on each anniversary of September 30, 2005, each individual who is then an Outside Director shall be granted an Award to purchase or receive, directly or indirectly, a number of shares of Common Stock such that the Award will have a value (as determined by the Committee) of $28,750 on September 30, 2005 and $28,750, or such other amount as is determined by the Board, on each anniversary of September 30, 2005, rounded down to the nearest whole share. Such Award will vest over a one year period in four equal quarterly installments with the first installment vesting on the three month anniversary of the date of such Award’s grant.

5. Section 6.8(d) of the Plan is hereby amended by deleting such Section and substituting in lieu thereof the following:

(b) Each grant of an Award under this Section 6.8 shall be evidenced by an Award Agreement setting forth the number of shares subject to the Award, the price or exercise price (if any), the Award Period of the Award (if any), and such other terms and provisions determined by the Committee as are not inconsistent with the Plan.

6. Section 8.6 of the Plan is hereby amended by deleting such Section and substituting in lieu thereof the following:

8.6 Payment of Taxes for Outside Directors. In connection with the exercise, vesting or other tax-triggering event related to an Award granted to an Outside Director prior to September 30, 2005, the Company shall pay such Outside Director subject to such tax an amount equal to forty percent of the gains resulting from such exercise, vesting or other tax-triggering event; provided, that the Company shall not be obligated (a) to pay more than $10,000 for each twelve month period of service (prorated for shorter periods of service) by such Outside Director as a member of the Company’s Board of Directors for the periods of service ending on or prior to September 30, 2005; or (b) to pay any such tax reimbursement for any period of service commencing on or after September 30, 2005.

7. Except as expressly amended by this Amendment, the Plan shall continue in full force and effect in accordance with the provisions thereof.

* * * * *

IN WITNESS WHEREOF, the Company has caused this Amendment to be duly executed as of the date first written above.


KITTY HAWK, INC.
By:	/s/ Steven E. Markhoff
	Name:	Steven E. Markhoff
	Title:	Vice President Strategic Planning, General Counsel and Corporate Secretary

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