Exhibit 10.3

NON-UNION EMPLOYEE OPTION PLAN

December 30, 2008

The following describes the Non-Union Employee Option Plan (the “Plan”) of YRC
Worldwide Inc. (the “Company”):

 

1. The Company will grant options to purchase the Company’s common stock
(“options”) to all U.S. and Canadian non-union employees of the Company and its
subsidiaries who are classified as full-time (the “Qualifying Employees”, but
excluding employees who participate in the Company’s LTIP).

 

2. The maximum number of options will be options to purchase 5,269,577 shares of
the Company’s common stock. The options shall be granted as of the Effective
Date.

 

3. “Effective Date” means January 2, 2009.

 

4. The number of options granted on the Effective Date to each Qualifying
Employee in a grade level shall be the number set forth beside each grade level
in Exhibit A. Each Qualifying Employee shall be notified and furnished
appropriate documentation as quickly as reasonably possible after the Effective
Date of the Qualifying Employee’s specific grant. The number of options in all
grade levels may not exceed the maximum number of options defined in Section 2.
The unallocated portion of the maximum options may be withheld from allocation
to specific employees to cure any administrative errors in distributing the
grants. If these options are not distributed, they shall be forfeited. Only
whole numbers of options may be granted.

 

5. Each option will have an exercise price equal to the closing price of the
Company’s common stock trading on The NASDAQ Stock Market on the Effective Date,
or if the Effective Date is not on a trading day, on the first trading day
following the Effective Date.

 

6.

The options shall vest at the rate of 25% per year upon each January 2nd,
commencing on January 2, 2010. Once vested, the options shall become exercisable
and remain exercisable for 10 years following the Effective Date (the “Exercise
Period”).

 

7. The options shall include a cashless exercise provision and shall provide for
a net exercise for paying each Qualifying Employee’s withholding taxes at the
applicable statutory rate.

 

8. Except as described in Sections 9-12 below, if a Qualifying Employee
terminates employment (other than because of death, disability or retirement),
all unvested options will terminate. All vested options shall remain the
property of the Qualifying Employee, but the Qualifying Employee shall only have
90 days after termination of employment to exercise the vested options, subject
to the Exercise Period.

 

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9. If a Qualifying Employee retires on or after the date the Company’s
shareholders approve the Plan, any unvested options shall continue to vest
according to their terms, all vested options shall remain the property of the
Qualifying Employee and all vested options shall be exercisable during the
Exercise Period. For this purpose, “retirement” is deemed to occur when a
Qualifying Employee terminates employment (other than by death) when his or her
age is 65 or greater or age plus years of service equals or exceeds 75, in each
case, at the time of termination.

 

10. If a Qualifying Employee dies or becomes permanently and totally disabled on
or after the date the shareholders of the Company have approved the Plan, the
Qualifying Employee or the Qualifying Employee’s estate shall retain all vested
options, any options that would have otherwise vested following the date of his
or her death or disability shall also vest and vested options shall be
exercisable for one year following the date of death or disability, subject to
the Exercise Period. A Qualifying Employee shall be considered “permanently and
totally disabled” if the Qualifying Employee is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months or is, by reason of any
medically determinable physical or mental impairment that can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, receiving income replacement benefits for a period of not less
than three months under an accident and health plan covering employees of the
Qualifying Employee’s employer. The existence of a permanent and total
disability shall be evidenced by such medical certification as the Secretary of
the Company shall require and as the Compensation Committee (the “Committee”) of
the Board of Directors of the Company approves.

 

11. If the Company terminates a Qualifying Employee due to a lay off, reduction
in force or elimination of the Qualifying Employee’s position on or after the
date the Company’s shareholders shall have approved the Plan, the Qualifying
Employee will retain his or her vested options; and, in addition, pursuant to a
severance benefit program or arrangement, the Company may, in its sole
discretion which need not be reasonably exercised, permit the Qualifying
Employee to retain any unvested options that shall vest during a period
following separation that the Company shall determine and may permit the
Qualifying Employee to exercise the options at anytime during the Exercise
Period. After any such vesting period, all other unvested options shall
terminate.

 

12. If a “Change of Control” of the parent company, YRC Worldwide Inc., occurs
while the Qualifying Employee is in the employ of the Company or a subsidiary of
the Company prior to the time the options vest but on or after the date the
shareholders of the Company shall have approved the Plan, the options shall
accelerate and become fully vested and become an option to receive, upon
exercise and payment of the exercise price, the same consideration that other
shareholders of the Company would receive as result of the Change of Control.
For the purposes of this Section, a “Change of Control” shall be deemed to have
taken place if:

 

  (a)

a third person, including a “group” as defined in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), purchases or
otherwise

 

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acquires shares of the Company after the date of grant that, together with stock
held by such person or group, constitutes more than 50 percent of the total fair
market value or total voting power of the stock of the Company;

 

  (b) a third person, including a “group” as defined in Section 13(d)(3) of the
Exchange Act, purchases or otherwise acquires (or has acquired during the
12-month period ending on the date of the most recent acquisition by such person
or group) shares of the Company after the date of grant and as a result thereof
becomes the beneficial owner of shares of the Company having 35% or more of the
total number of votes that may be cast for election of directors of the Company;
or

 

  (c) as the result of, or in connection with any cash tender or exchange offer,
merger or other Business Combination, or contested election, or any combination
of the foregoing transactions, the Continuing Directors shall cease to
constitute a majority of the Board of Directors of the Company or any successor
to the Company during any 12-month period.

For the purposes of this Section 12, “Business Combination” means any
transaction that is referred to in any one or more of clauses (a) through (e) of
Section 1 of Subparagraph A of Article Seventh of the Certificate of
Incorporation of the Company; and “Continuing Director” means a director of the
Company who meets the definition of Continuing Director contained in Section 7
of Subparagraph C of Article Seventh of the Certificate of Incorporation of the
Company.

 

13. Transfers of employment between the Company and a subsidiary, or between
subsidiaries, shall not constitute a termination of employment for purposes of
the options.

 

14. Authorized leaves of absence from the Company shall not constitute a
termination of employment for purposes of the options. For purposes of the
options, an authorized leave of absence shall be an absence while the Qualifying
Employee is on military leave, sick leave, or other bona fide leave of absence
so long as the Qualifying Employee’s right to employment with the Company is
guaranteed by statute, a contract or Company policy.

 

15. To the extent Qualifying Employees have taxable income in connection with
the grant, vesting or exercise of the options or the delivery of shares of
Company common stock, the Company is authorized to withhold from any
compensation payable to Qualifying Employees, including shares of common stock
that the Company is to deliver to the Qualifying Employees, any taxes required
to be withheld by foreign, federal, state, provincial or local law.

 

16. No rights under the options shall be transferable otherwise than by will,
the laws of descent and distribution or pursuant to a qualifying domestic
relations order (“QDRO”), and, except to the extent otherwise provided herein,
the rights and the benefits of the options may be exercised and received,
respectively, during the lifetime of the Qualifying Employee only by the
Qualifying Employee or by the Qualifying Employee’s guardian or legal
representative or by an “alternate payee” pursuant to a QDRO.

 

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17. The options shall not be effective until the Company’s shareholders approve
the issuance of options and the common stock issuable upon exercise of the
options, in each case, pursuant to the Plan. If after presentation to the
Company’s shareholders for a vote, the Company’s shareholders do not approve the
issuance of options and the common stock issuable upon exercise of the options,
in each case, pursuant to the Plan, the options shall automatically terminate.

 

18. Under no circumstances will the Company be liable for any indirect,
incidental, consequential or special damages (including lost profits) of any
form incurred by any person, whether or not foreseeable and regardless of the
form of the act in which such a claim may be brought, with respect to the Plan
or the Company’s role as Plan sponsor.

 

19. Notwithstanding anything else in the Plan, the shares received upon exercise
of the options may not be sold, pledged or hypothecated until such time as the
Company complies with all regulatory requirements regarding registration of the
shares to be issued under the terms of the Plan.

 

20. Any shares subject to options that are forfeited or terminated under the
Plan shall no longer be reserved for issuance under the Plan.

 

21. The Plan has been designed so that the grant, vesting, exercise and payments
of awards hereunder are not subject to the requirements of Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”). To the extent that an
award or payment, or the settlement or deferral thereof, is or becomes subject
to Section 409A of the Code, except as the Committee otherwise determines in
writing, the award shall be granted, paid, settled or deferred in a manner that
will meet the requirements of Section 409A of the Code, including regulations or
other guidance issued with respect thereto, such that the grant, payment,
settlement or deferral shall not be subject to any additional taxation
applicable under Section 409A of the Code.

 

22. The Plan shall be governed, construed and administered in accordance with
the laws of the State of Delaware without giving effect to the conflict of laws
principles.

 

23. The Plan described above represents the plan of the Company regarding the
non-union options. The Committee is authorized to amend and modify the Plan for
the purposes of administration to address additional details such as (without
limitation) the impact of stock splits and administrative matters. Any such
amendments or modifications shall be final and binding on the Qualifying
Employees. The Committee shall administer and interpret the Plan, and its
decisions shall be final and binding with respect to administration and
interpretation.

 

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