FORWARD AIR CORPORATION
 
 
NOTICE OF GRANT OF PERFORMANCE SHARES
 

The Participant has been granted an award of an opportunity to receive a number
of Performance Shares (the “Award”) pursuant to the Forward Air Corporation
Amended and Restated Stock Option and Incentive Plan (the “Plan”) and the
Performance Share Agreement attached hereto (the “Agreement”), as follows:

Participant:
 
Employee ID:
 
Grant Date:
February 11, 2011
Grant No.:
 
Target Number of Performance Shares:
 
[_______________], subject to adjustment as provided by the Agreement.
Maximum Number of Performance Shares:
[_______________], subject to adjustment as provided by the Agreement.
Performance Metric:
Percentile Ranking of Common Stock Price Appreciation within Peer Group
Performance Period:
Three-year period beginning on the Grant Date and ending on the third
anniversary of the Grant Date (February 11, 2011 – February 11, 2014)
Performance Share Vesting Date:
The 30th day after the last day of the Performance Period, except as otherwise
provided by the Agreement.
Vested Performance Shares:
Provided that the Participant’s Service has not terminated prior to the
Performance Share Vesting Date, except as provided by the Agreement, on the
Performance Share Vesting Date the number of Vested Performance Shares (not to
exceed the Maximum Number of Performance Shares) shall be determined by
multiplying the Target Number of Performance Shares by the Appreciation
Multiplier (as defined by the Agreement).
Settlement Date:
The Performance Share Vesting Date, except as otherwise provided by the
Agreement.
Recoupment Policy:
The Award shall be subject to the terms and conditions of such policy on the
recoupment of incentive compensation as shall be adopted by the Company to
implement the requirements of Section 954 of the Dodd-Frank Wall Street Reform
and Consumer Protection Act.

By their signatures below, the Company and the Participant agree that the Award
is governed by this Notice and by the provisions of the Plan and the Agreement,
both of which are made a part of this document.  The Participant acknowledges
receipt of a copy of the Plan, the Agreement and the prospectus for the Plan,
represents that the Participant has read and is familiar with the provisions of
the Plan and the Agreement, and hereby accepts the Award subject to all of their
terms and conditions.
 
FORWARD AIR CORPORATION
   
PARTICIPANT
                   
By:
                           
Signature
                     
Its:
                           
Date
   

ATTACHMENT:
Performance Share Agreement

 
 
 

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FORWARD AIR CORPORATION
PERFORMANCE SHARE AGREEMENT

Forward Air Corporation, a Tennessee corporation (the “Company”), has granted to
the Participant named in the Notice of Grant of Performance Shares (the “Grant
Notice”) to which this Performance Share Agreement (the “Agreement”) is attached
an Award consisting of Performance Shares subject to the terms and conditions
set forth in the Grant Notice and this Agreement.  The Award has been granted
pursuant to the Forward Air Corporation Amended and Restated Stock Option and
Incentive Plan (the “Plan”), as amended to the Grant Date, the provisions of
which are incorporated herein by reference.
 
1. Definitions and Construction.
 
1.1 Definitions.  Unless otherwise defined herein, including within the Glossary
at the end of this Agreement, capitalized terms shall have the meanings assigned
to such terms in the Grant Notice or the Plan.
 
1.2 Construction.  Captions and titles contained herein are for convenience only
and shall not affect the meaning or interpretation of any provision of this
Agreement.  Except when otherwise indicated by the context, the singular shall
include the plural and the plural shall include the singular.  The Company
intends that the Award made under this Agreement constitute qualified
performance-based compensation within the meaning of Section 162(m) of the Code
and the regulations thereunder, and the provisions of this Agreement shall be
construed and administered in a manner consistent with this intent. The Company
intends that the Award made under this Agreement comply with, or otherwise be
exempt from, Section 409A (including any amendments or replacements of such
section), and the provisions of this Agreement shall be construed and
administered in a manner consistent with this intent.
 
2. Administration.
 
All questions of interpretation concerning the Grant Notice, this Agreement and
the Plan shall be determined by the Committee.  All determinations by the
Committee shall be final, binding and conclusive upon all persons having an
interest in the Award.
 
3. The Award.
 
3.1 Grant of Performance Shares.  On the Grant Date, the Participant has
acquired, subject to the provisions of this Agreement, an opportunity to receive
a number of Performance Shares, which shall not exceed the Maximum Number of
Performance Shares set forth in the Grant Notice, subject to adjustment as
provided in Section 9.  The number of Performance Shares, if any, ultimately
earned by the Participant, shall be that number of Performance Shares which
become Vested Performance Shares.
 
3.2 No Monetary Payment Required.  The Participant is not required to make any
monetary payment (other than applicable tax withholding, if any) as a condition
to receiving the Performance Shares or the Common Shares issued upon settlement
of the Performance Shares, the consideration for which shall be past services
actually rendered and/or future services to be rendered to the Company (or any
Affiliate) or for its benefit.  Notwithstanding the foregoing, if required by
applicable state corporate law, the Participant shall furnish consideration in
the form of cash or past services rendered to the Company (or any Affiliate) or
for its benefit having a value not less than the par value of the Common Shares
issued upon settlement of the Vested Performance Shares.
 
 
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4. Certification by the Committee.
 
4.1 Percentile Ranking of Peer Group Common Stock Price Appreciation.  As soon
as practicable following completion of the Performance Period, and in any event
on or before the Performance Share Vesting Date, the Committee shall certify in
writing the Appreciation Percentile Ranking of the Company for the Performance
Period and the resulting number of Performance Shares, if any, which shall
become Vested Performance Shares on the Performance Share Vesting Date, subject
to the Participant’s continued Service until the Performance Share Vesting Date,
except as otherwise provided by Section 5.  The number of Performance Shares
which shall become Vested Performance Shares on the Performance Share Vesting
Date, subject to the Participant’s continued Service until the Performance Share
Vesting Date, shall be determined by multiplying the Target Number of
Performance Shares specified on the Grant Notice by the Appreciation Multiplier
specified below, based on the Company’s Common Stock Price Appreciation for the
Performance Period relative to the Common Stock Price Appreciation of the Peer
Companies, rounding up to the nearest whole share:
 
Appreciation Percentile Ranking
Appreciation Multiplier
90th percentile or higher
                          200%
70th to 89th percentile
                          150%
50th to 69th percentile
                          100%
30th to 49th percentile
                            50%
Below 30th percentile
                              0%

The Company shall promptly notify the Participant of the determination by the
Committee.
 
4.2 Adjustment to Performance Period.  Notwithstanding anything on the Grant
Notice or in this Agreement to the contrary, if for any reason the Company
(including any successor corporation) ceases to have its Common Stock listed for
public trade on any national securities exchange or market before the last day
of the Performance Period specified on the Grant Notice, the Performance Period
shall end as of the last date that the Company’s Common Stock is listed for
public trade on a national securities exchange or market.  Any temporary halt in
trading, including without limitation any period during which trade is suspended
while the Company comes into compliance with the reporting requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, shall be
disregarded for this purpose.
 
5. Vesting of Performance Shares.
 
5.1 In General.  Except as provided by this Section 5 and Section 8, the
Performance Shares shall vest and become Vested Performance Shares as provided
in the Grant Notice and Section 4.1, as certified by the Committee.
 
5.2 Termination of Service Other Than By Reason of Retirement, Death, Disability
or Coincident with a Change in Control of the Company.  In the event the
Participant’s Service terminates for any reason prior to the Performance Share
Vesting Date, other than by reason of Retirement, death, Disability or
coincident with a Change in Control of the Company, the Participant shall
immediately forfeit, without requiring any act of the Participant or the Company
to effectuate such forfeiture, all rights to and interests in the Performance
Shares subject to the Award and the Award shall be cancelled as of the last day
of the Participant’s Service.  The Participant shall not be entitled to any
payment for such forfeited Performance Shares.
 
 
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5.3 Termination of Service by Reason of Death or Disability.  In the event the
Participant’s Service terminates by reason of death or Disability prior to the
Performance Share Vesting Date, a number of Performance Shares shall become
Vested Performance Shares on the last day of the Participant’s Service as
follows.  The number of Performance Shares which shall become Vested Performance
Shares shall be the product, rounded up to the nearest whole share, of (a) the
Target Number of Performance Shares specified on the Grant Notice, multiplied by
(b) an Appreciation Multiplier of 100%, multiplied by (c) a percentage equal to
the ratio of the number of whole and partial months (rounded up to the nearest
integer) of the Participant’s Service during the Performance Period to the
number of full months contained in the Performance Period.  Notwithstanding the
foregoing, in the event the Participant’s Service terminates by reason of death
or Disability after the end of the Performance Period but prior to the
Performance Share Vesting Date, the Appreciation Multiplier to be used in the
equation set forth in the immediately preceding sentence shall be the
Appreciation Multiplier applicable for the Performance Period as determined
under Section 4.1.  The Participant shall forfeit, without requiring any act of
the Participant, his personal representative or the Company to effectuate such
forfeiture, all rights to and interests in any Performance Shares subject to the
Award that do not become Vested Performance Shares under this Section 5.3 and
the Award shall be cancelled with respect to such unvested Performance Shares on
the last day of the Participant’s Service.  Neither the Participant nor any
person claiming through the Participant shall be entitled to any payment for
such forfeited Performance Shares.
 
5.4 Termination of Service by Reason of Retirement.  In the event the
Participant’s Service terminates by reason of Retirement prior to the
Performance Share Vesting Date, then on the Performance Share Vesting Date the
number of Performance Shares that shall become Vested Performance Shares,
rounded up to the nearest whole share, shall be determined by multiplying
(a) that number of Performance Shares that would have become Vested Performance
Shares under Section 4.1 had no such termination occurred by (b) a percentage
equal to the ratio of the number of whole and partial months (rounded up to the
nearest integer) of the Participant’s Service during the Performance Period to
the number of full months contained in the Performance Period.
 
5.5 Forfeiture of Unvested Performance Shares.  Except as otherwise provided by
this Section 5 or Section 8, on the Performance Share Vesting Date, the
Participant shall forfeit, without requiring any act of the Participant or the
Company to effectuate such forfeiture, all rights to and interests in any
Performance Shares subject to the Award that have not become Vested Performance
Shares and the Award shall be cancelled with respect to such unvested
Performance Shares.  The Participant shall not be entitled to any payment for
such forfeited Performance Shares.
 
6. Settlement of the Award.
 
6.1 Issuance of Common Shares.  Subject to the provisions of Section 6.3,
Section 7.2 and Section 8.1 below, the Company shall issue to the Participant on
the Settlement Date with respect to each Vested Performance Share one (1) Common
Share.  Common Shares issued in settlement of Performance Shares shall be
subject to any restrictions as may be required pursuant to Section 6.3,
Section 7 or the Insider Trading Policy.
 
6.2 Beneficial Ownership of Common Shares. Upon issuance of Common Shares in
settlement of the Award, the Company will determine the form of delivery (e.g.,
a stock certificate or electronic entry evidencing such shares) and may deliver
such shares on the Participant’s behalf electronically to the Company’s
designated stock plan administrator or such other broker-dealer as the Company
may choose at its sole discretion, within reason.  Except as otherwise provided
by this Section 6.2, the Common Shares as to which the Award is settled shall be
registered in the name of the Participant, or, if applicable, in the names of
the heirs or estate of the Participant.
 
6.3 Restrictions on Grant of the Award and Issuance of Common Shares.  The grant
of the Award and issuance of Common Shares upon settlement of the Award shall be
subject to compliance with all applicable requirements of federal, state or
foreign law with respect to such securities.  No Common Shares may be issued
hereunder if the issuance of such shares would constitute a violation of any
applicable federal, state or foreign securities laws or other law or regulations
or the requirements of any stock exchange or market system upon which the Common
Stock may then be listed.  The inability of the Company to obtain from any
regulatory body having jurisdiction the authority, if any, deemed by the
Company’s legal counsel to be necessary to the lawful issuance of any Common
Shares subject to the Award shall relieve the Company of any liability in
respect of the failure to issue such shares as to which such requisite authority
shall not have been obtained.  As a condition to the settlement of the Award,
the Company may require the Participant to satisfy any qualifications that may
be necessary or appropriate, to evidence compliance with any applicable law or
regulation and to make any representation or warranty with respect thereto as
may be requested by the Company.
 
 
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6.4 Fractional Shares.  The Company shall not be required to issue fractional
Common Shares upon the settlement of the Award.  Any fractional share resulting
from the determination of the number of Vested Performance Shares shall be
rounded up to the nearest whole number.
 
7. Tax Matters.
 
7.1 In General.  At the time the Grant Notice is executed, or at any time
thereafter as requested by the Company, the Participant hereby authorizes
withholding from payroll and any other amounts payable to the Participant, and
otherwise agrees to make adequate provision for, any sums required to satisfy
the federal, state, local and foreign tax withholding obligations of the
Company, if any, which arise in connection with the Award or the issuance of
Common Shares in settlement thereof.  The Company shall have no obligation to
process the settlement of the Award or to deliver Common Shares until the tax
withholding obligations as described in this Section have been satisfied by the
Participant.
 
7.2 Withholding in Common Shares.  Subject to applicable law, the Company may,
in its sole discretion, permit the Participant to satisfy any tax withholding
obligations that arise in connection with the Award by directing that the
Company reduce the number of shares of Common Shares otherwise issuable to the
Participant in settlement of the Award by a number of whole Common Shares having
a fair market value, as determined by the Company as of the date on which the
tax withholding obligations arise, up to but not in excess of the amount of such
tax withholding obligations determined by the applicable minimum statutory
withholding rates.
 
8. CHANGE IN CONTROL.
 
8.1 Acceleration of Vesting Upon a Change in Control.  In the event of the
consummation of a Change in Control before the last day of the Performance
Period, vesting of the outstanding Award shall be accelerated so that 100% of
the Target Number of Performance Shares shall become Vested Performance Shares
effective as of the date of the Change in Control, provided that the
Participant’s Service has not terminated prior to the Change in Control.  In the
event of the consummation of a Change in Control after the last day of the
Performance Period but before the Performance Share Vesting Date, vesting of the
outstanding Award shall be accelerated so that the greater of (a) 100% of the
Target Number of Performance Shares or (b) the number of Performance Shares that
would have become vested as of the Performance Share Vesting Date, based on the
Appreciation Multiplier attained for the Performance Period, shall become Vested
Performance Shares effective as of the date of the Change in Control, provided
that the Participant’s Service has not terminated prior to the Change in
Control.  Notwithstanding the foregoing, if the Participant’s Service terminates
due to Retirement and a Change in Control is consummated before the
Participant’s Award is settled, vesting of the Participant’s outstanding Award
shall be accelerated so that a number of Performance Shares shall become Vested
Performance Shares effective as of the date of the Change in Control determined,
rounded up to the nearest whole share, by multiplying (a) that number of
Performance Shares that would have become Vested Performance Shares under this
Section 8.1 had no such Retirement occurred by (b) a percentage equal to the
ratio of the number of whole and partial months (rounded up to the nearest
integer) of the Participant’s Service during the Performance Period to the
number of full months contained in the Performance Period as reflected on the
Grant Notice. In settlement of the Award, the Company shall issue to the
Participant, on the date of the Change in Control, one (1) Common Share for each
Vested Performance Share determined in accordance with this Section 8.1.  The
vesting of Performance Shares and settlement of the Award that was permissible
solely by reason of this Section 8.1 shall be conditioned upon the consummation
of the Change in Control.  Notwithstanding the foregoing, the Committee may, in
its discretion, determine that upon a Change in Control, each Award outstanding
immediately prior to the Change in Control shall be canceled in exchange for
payment with respect to the greater of (a) 100% of the Target Number of
Performance Shares or (b) the number of Performance Shares that would otherwise
become Vested Performance Shares by reason of this Section 8.1, in (a) cash,
(b) stock of the Company or the acquiring entity or any parent company of the
acquiring entity, or (c) other property which, in any such case, shall be in an
amount having a Fair Market Value equal to the Fair Market Value of the
consideration to be paid per share of Common Stock in the Change in Control for
each such Performance Share (subject to any required tax withholding).  Such
payment shall be made on or as soon as practicable following the Change in
Control.  All of the foregoing provisions of this Section 8.1 may be revised or
eliminated, in whole or in part, in the discretion of the Committee and without
the consent of the Participant, to the extent that the Committee determines such
action to be appropriate or desirable after obtaining in connection with a
Change in Control transaction a shareholder advisory vote required by Section
951 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or any
successor provision, on golden parachute compensation arrangements, provided
that this Agreement is a subject of that advisory vote.
 
 
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8.2 Federal Excise Tax Under Section 4999 of the Code.
 
(a) Excess Parachute Payment.  In the event that any acceleration of vesting of
the Performance Shares and any other payment or benefit received or to be
received by the Participant would subject the Participant to any excise tax
pursuant to Section 4999 of the Code due to the characterization of such
acceleration of vesting, payment or benefit as an “excess parachute payment”
under Section 280G of the Code, the Participant may elect, in his or her sole
discretion before the consummation of the Change in Control transaction, to
reduce the amount of any acceleration of vesting called for by this Agreement in
order to avoid such characterization.
 
(b) Determination by Independent Accountants.  To aid the Participant in making
any election called for under Section 8.2(a), no later than ten (10) days before
the anticipated date of the occurrence of any event that might reasonably be
anticipated to result in an “excess parachute payment” to the Participant as
described in Section 8.2(a) (an “Event”), the Company shall request a
determination in writing by independent public accountants selected by the
Company (the “Accountants”).  Unless the Company and the Participant otherwise
agree in writing, the Accountants shall determine and report to the Company and
the Participant within three (3) days before the date of the Event the amount of
such acceleration of vesting, payments and benefits which would produce the
greatest after-tax benefit to the Participant.  For the purposes of such
determination, the Accountants may rely on reasonable, good faith
interpretations concerning the application of Sections 280G and 4999 of the Code
and make reasonable assumptions and projections needed to make their required
determination.  The Company and the Participant shall furnish to the Accountants
such information and documents as the Accountants may reasonably request in
order to make their required determination.  The Company shall bear all fees and
expenses the Accountants may reasonably charge in connection with their services
contemplated by this Section 8.2(b).
 
9. Adjustments for Changes in Capital Structure.
 
Subject to any required action by the stockholders of the Company, in the event
of any change in the Common Shares effected without receipt of consideration by
the Company, whether through merger, consolidation, reorganization,
reincorporation, recapitalization, reclassification, stock dividend, stock
split, reverse stock split, split-up, split-off, spin-off, combination of
shares, exchange of shares, or similar change in the capital structure of the
Company, or in the event of payment of a dividend or distribution to the
stockholders of the Company in a form other than Common Shares (excepting normal
cash dividends) that has a material effect on the Fair Market Value of the
Common Shares, appropriate adjustments shall be made by the Committee in the
number of Performance Shares and/or the number and kind of shares to be issued
in settlement of the Award, in order to prevent dilution or enlargement of the
Participant’s rights under the Award.  For purposes of the foregoing, conversion
of any convertible securities of the Company shall not be treated as “effected
without receipt of consideration by the Company.”  Any fractional share
resulting from an adjustment pursuant to this Section shall be rounded down to
the nearest whole number.  Such adjustments shall be determined by the
Committee, and its determination shall be final, binding and conclusive.  The
Committee shall have discretion to make appropriate adjustments, as determined
by the Committee, to the Common Stock Price Appreciation calculation for the
Company or any Peer Company in the event that the common securities of the
Company or such Peer Company are affected by a stock split, reverse stock split,
stock dividend, or similar change in capitalization.
 
 
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10. Rights as a Stockholder or Employee.
 
The Participant shall have no rights as a stockholder with respect to any Common
Shares which may be issued in settlement of this Award until the date of the
issuance of such shares (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the Company).  No
adjustment shall be made for dividends, distributions or other rights for which
the record date is prior to the date such shares are issued, except as provided
in Section 9.  Except as otherwise provided in a separate, written employment
agreement between the Company or any Affiliate and the Participant, the
Participant’s employment is “at will” and is for no specified term.  Nothing in
the Grant Notice or this Agreement shall confer upon the Participant any right
to continue in Service with the Company or any Affiliate or interfere in any way
with any right of the Company or any Affiliate to terminate the Participant’s
Service with the Company or any Affiliate at any time.
 
11. Compliance with Section 409A.
 
11.1 General Rule of Interpretation.  This Agreement and the Performance Shares
granted hereunder are intended to fit within the “short-term deferral” exemption
from Section 409A as set forth in Treas. Reg. § 1.409A-1(b)(4).  In
administering this Agreement, the Committee shall interpret this Agreement in a
manner consistent with such exemption.
 
11.2 Required Delay in Payment to Specified Employee.  Notwithstanding the
foregoing, if it is determined that the Performance Shares fail to satisfy the
requirements of the short-term deferral rule and otherwise result in Section
409A Deferred Compensation, and if the Participant is a “specified employee”
(within the meaning set forth Section 409A(a)(2)(B)(i) of the Code) as of the
date of the Participant’s separation from service (within the meaning of Treas.
Reg. § 1.409A-1(h)), then the issuance of any shares that would otherwise be
made in connection with a "separation from service” (as determined for purposes
of Section 409A) upon the date of the separation from service or within the
first six (6) months thereafter will not be made on the originally scheduled
date(s) and will instead be issued in a lump sum on the date that is six
(6) months and one day after the date of the separation from service, but if and
only if such delay in the issuance of the shares is necessary to avoid the
imposition of additional taxation on the Participant in respect of the shares
under Section 409A.
 
11.3 Other Delays in Payment.  Neither the Participant nor the Company shall
take any action to accelerate or delay the payment of any benefits under this
Agreement in any manner which would not be in compliance with Code Section
409A.  Notwithstanding the foregoing:
 
(a) If any payment is due to the Participant upon a Change in Control but such
Change in Control does not constitute a change in ownership or effective control
of the Company or a change in the ownership of a substantial portion of the
assets of the Company as defined in Section 409A(a)(2)(A)(v), then such payment
which constitutes Section 409A Deferred Compensation shall be deferred until
another permissible payment event contained in Section 409A occurs (e.g., death,
Disability, separation from service from the Company and its affiliated
companies as defined for purposes of Section 409A).
 
(b) If any payment is due to the Participant upon the Participant’s termination
of Service but such termination of Service does not constitute a “separation
from service” as defined in Section 409A(a)(2)(A)(i), then such payment which
constitutes Section 409A Deferred Compensation shall be deferred until another
permissible payment event contained in Section 409A occurs.
 
(c) If any payment is due to the Participant upon the Participant’s becoming
Disabled but such disability does not meet the requirements of a disability
under Section 409A(a)(2)(C), then such payment which constitutes Section 409A
Deferred Compensation shall be deferred until another permissible payment event
contained in Section 409A occurs.
 
 
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11.4 Amendments to Comply with Section 409A; Indemnification.  Notwithstanding
any other provision of this Agreement to the contrary, the Company is authorized
to amend this Agreement, to void or amend any election made by the Participant
under this Agreement and/or to delay the payment of any monies and/or provision
of any benefits in such manner as may be determined by the Company, in its
discretion, to be necessary or appropriate to comply with Section 409A without
prior notice to or consent of the Participant.  The Participant hereby releases
and holds harmless the Company, its directors, officers and stockholders from
any and all claims that may arise from or relate to any tax liability,
penalties, interest, costs, fees or other liability incurred by the Participant
in connection with the Award, including as a result of the application of
Section 409A.
 
11.5 Advice of Independent Tax Advisor.  The Company has not obtained a tax
ruling or other confirmation from the Internal Revenue Service with regard to
the application of Section 409A to the Award, and the Company does not represent
or warrant that this Agreement will avoid adverse tax consequences to the
Participant, including as a result of the application of Section 409A to the
Award.  The Participant hereby acknowledges that he or she has been advised to
seek the advice of his or her own independent tax advisor prior to entering into
this Agreement and is not relying upon any representations of the Company or any
of its agents as to the effect of or the advisability of entering into this
Agreement.
 
12. Miscellaneous Provisions.
 
12.1 Termination or Amendment.  The Committee may terminate or amend the Plan or
this Agreement at any time; provided, however, that except as provided in
Section 8 in connection with a Change in Control, no such termination or
amendment may materially adversely affect the Participant’s rights under this
Agreement, as determined in good faith in the discretion of the Committee,
without the consent of the Participant unless such termination or amendment is
necessary to comply with applicable law or government regulation, including, but
not limited to, Section 409A.  No amendment or addition to this Agreement shall
be effective unless in writing.
 
12.2 Nontransferability of the Award.  Prior the issuance of Common Shares,
neither this Award nor any Performance Shares subject to this Award shall be
subject in any manner to anticipation, alienation, sale, exchange, transfer,
assignment, pledge, encumbrance, garnishment by creditors of the Participant or
the Participant’s beneficiary, or in any other manner made subject to a hedging
transaction or puts and calls, except transfer by will or by the laws of descent
and distribution.  All rights with respect to the Award shall be exercisable
during the Participant’s lifetime only by the Participant or the Participant’s
guardian or legal representative.
 
12.3 Unfunded Obligation.  The Participant shall have the status of a general
unsecured creditor of the Company.  Any amounts payable to the Participant
pursuant to the Award shall be an unfunded and unsecured obligation for all
purposes, including, without limitation, Title I of the Employee Retirement
Income Security Act of 1974.  The Company shall not be required to segregate any
monies from its general funds, or to create any trusts, or establish any special
accounts with respect to such obligations.  The Company shall retain at all
times beneficial ownership of any investments, including trust investments,
which the Company may make to fulfill its payment obligations hereunder.  Any
investments or the creation or maintenance of any trust or any Participant
account shall not create or constitute a trust or fiduciary relationship between
the Committee or the Company and the Participant, or otherwise create any vested
or beneficial interest in the Participant or the Participant’s creditors in any
assets of the Company.  The Participant shall have no claim against the Company
for any changes in the value of any assets which may be invested or reinvested
by the Company with respect to the Award.
 
 
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12.4 Further Instruments.  The Company and the Participant agree to execute such
further instruments and to take such further action as may reasonably be
necessary to carry out the intent of this Agreement.
 
12.5 Binding Effect.  This Agreement shall inure to the benefit of the
successors and assigns of the Company and, subject to the restrictions on
transfer set forth herein, be binding upon the Participant and the Participant’s
heirs, executors, administrators, successors and assigns.
 
12.6 Delivery of Documents and Notices.  Any document relating to participation
in the Plan or any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery, electronic
delivery at the e-mail address, if any, provided for the Participant by the
Company or any Affiliate, or upon deposit in the U.S. Post Office, by registered
or certified mail, or with a nationally recognized overnight courier service,
with postage and fees prepaid, addressed as applicable to the last known address
of the Participant or the address of the principal executive office of the
Company, in care of its General Counsel, or at such other address as such party
may designate in writing from time to time to the other party.
 
(a) Description of Electronic Delivery.  The Plan documents, which may include
but do not necessarily include: the Plan, the Grant Notice, this Agreement, the
Plan prospectus, and any reports of the Company provided generally to the
Company’s stockholders, may be delivered to the Participant electronically.  In
addition, the Participant may deliver electronically the Grant Notice to the
Company or to such third party involved in administering the Plan as the Company
may designate from time to time.  Such means of electronic delivery may include
but do not necessarily include the delivery of a link to a Company intranet or
the internet site of a third party involved in administering the Plan, the
delivery of the document via e-mail or such other means of electronic delivery
specified by the Company.
 
(b) Consent to Electronic Delivery.  The Participant acknowledges that the
Participant has read Section 12.6(a) of this Agreement and consents to the
electronic delivery of the Plan documents and Grant Notice, as described in
Section 12.6(a).  The Participant acknowledges that he or she may receive from
the Company a paper copy of any documents delivered electronically at no cost to
the Participant by contacting the Company by telephone or in writing.  The
Participant further acknowledges that the Participant will be provided with a
paper copy of any documents if the attempted electronic delivery of such
documents fails.  Similarly, the Participant understands that the Participant
must provide the Company or any designated third party administrator with a
paper copy of any documents if the attempted electronic delivery of such
documents fails.  The Participant may revoke his or her consent to the
electronic delivery of documents described in Section 12.6(a) or may change the
electronic mail address to which such documents are to be delivered (if
Participant has provided an electronic mail address) at any time by notifying
the Company of such revoked consent or revised e-mail address by telephone,
postal service or electronic mail.  Finally, the Participant understands that he
or she is not required to consent to electronic delivery of documents described
in Section 12.6(a).
 
12.7 Integrated Agreement.  The Grant Notice, this Agreement and the Plan shall
constitute the entire understanding and agreement of the Participant and the
Company with respect to the subject matter contained herein or therein and
supersedes any prior agreements, understandings, restrictions, representations,
or warranties between the Participant and the Company with respect to such
subject matter other than those as set forth or provided for herein or
therein.  To the extent contemplated herein or therein, the provisions of the
Grant Notice and the Agreement shall survive any settlement of the Award and
shall remain in full force and effect.
 
12.8 Applicable Law.  The validity, construction and effect of this Agreement,
and of any determinations or decisions made by the Committee relating to this
Agreement, and the rights of any and all persons having or claiming to have any
interest under this Agreement, shall be determined exclusively in accordance
with the laws of the State of Tennessee, without regard to its provisions
concerning the applicability of laws of other jurisdictions.  Any suit with
respect hereto will be brought in the federal or state courts in the districts
which include Greeneville, Tennessee, and you hereby agree and submit to the
personal jurisdiction and venue thereof.
 
 
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12.9 Counterparts.  The Grant Notice may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
 
{Glossary begins on next page}
 
 
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GLOSSARY

(a)           “Affiliate” means any entity, whether now or hereafter existing,
which controls, is controlled by, or is under common control with Forward Air
Corporation (including but not limited to joint ventures, limited liability
companies and partnerships).  For this purpose, “control” means ownership of 50%
or more of the total combined voting power of all classes of stock or interests
of the entity.

(b)           “Appreciation Multiplier” means a number determined as follows:

Appreciation Percentile Ranking
Appreciation Multiplier
90th percentile or higher
200%
70th to 89th percentile
150%
50th to 69th percentile
100%
30th to 49th percentile
50%
Below 30th percentile
  0%

(c)           “Appreciation Percentile Ranking” means the Company’s percentile
ranking relative to the Peer Companies, based on Common Stock Price
Appreciation, calculated as follows: 1 – [(Company Rank – 1)/(Total Number of
Peer Companies + the Company – 1)], rounding to the nearest whole
percentile.  For example, if the Company is ranked third out of a group of 13
consisting of the 12 Peer Companies plus the Company, the Percentile Ranking is
calculated as 1 – [(3 – 1)/(12 + 1 – 1)] or 1 – (2/12) or 1 – 0.1667 or the 83rd
percentile.  The Company’s rank is determined by ordering the Peer Companies and
the Company from highest to lowest based on Common Stock Price Appreciation for
the Performance Period and counting down from the entity with the highest Common
Stock Price Appreciation (ranked first) to the Company’s position on the
list.  If two entities are ranked equally, the ranking of the next entity shall
account for the tie, so that if one entity is ranked first and two entities are
tied for second, the next entity is ranked fourth.

(d)           “Average Price” means the average official closing price per share
over the 30 consecutive trading days ending with and including the applicable
day (if the applicable day is not a trading day, the next preceding trading
day), adjusted to reflect the effect of any dividends actually paid during the
30 consecutive trading day period.

(e)           “Cause” means a felony conviction of the Participant or the
failure of the Participant to contest prosecution for a felony, or the
Participant’s gross negligence, willful misconduct or dishonesty, any of which
is directly or materially harmful to the business or reputation of the Company,
as determined by the Committee in its sole discretion.

(f)           “Change in Control” shall have the meaning ascribed thereto in the
Plan.

(g)           “Committee” means the Board of Directors of Forward Air
Corporation or such committee or committees appointed by the Board to administer
the Plan.

(h)           “Common Shares” means shares of Common Stock issued in settlement
of the Award.

(i)           “Common Stock Price Appreciation” means an issuer’s total
appreciation realized in its common stock value over the Performance Period,
inclusive of dividends and other distributions paid during the Performance
Period, expressed as a percentage and determined by dividing (A) the sum of
(I) the Average Price of the issuer’s shares at the end of the Performance
Period minus the Average Price of the issuer’s shares at the beginning of the
Performance Period plus (II) all dividends and other distributions paid on the
issuer’s common shares during the Performance Period, by (B) the Average Price
of the issuer’s shares at the beginning of the Performance Period, rounded to
one decimal place (e.g., 3.3%).  In calculating Common Stock Price Appreciation,
all dividends are assumed to have been reinvested in shares on the ex-dividend
date.

 
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(j)           “Company” means Forward Air Corporation and its Affiliates, except
where the context otherwise requires.  For purposes of determining whether a
Change in Control has occurred, Company shall mean only Forward Air Corporation.

(k)           “Disability” means a disability as determined under procedures
established by the Committee for purposes of the Plan, so long as such
disability is within the meaning specified under Treas. Reg. § 1.409A-3(a)(4).

(l)           “Insider Trading Policy” means the written policy of the Company
pertaining to the sale, transfer or other disposition of the Company’s equity
securities by members of the Board, officers or other employees who may possess
material, non-public information regarding the Company, as in effect at the time
of a disposition of any Common Shares.

(m)           “Peer Company” means each of C.H. Robinson Worldwide, Inc.;
Con-way, Inc.; Expeditors International of Washington, Inc.; FedEx Corporation;
Hub Group, Inc.; J.B. Hunt Transport Services, Inc.; Knight Transportation,
Inc.; Landstar System, Inc.; Old Dominion Freight Line, Inc.; United Parcel
Service, Inc.; UTi Worldwide, Inc.; and Werner Enterprises, Inc., and each Peer
Company’s successor; so long as each Peer Company has a class of common
securities listed for public trade on a national securities exchange or market
from the beginning through the end of the Performance Period.  The Peer
Companies shall be changed as follows:

(A)  In the event that, at any time during the Performance Period, a Peer
Company is no longer included in the same Standard & Poor’s Global Industry
Classification Standard (“GICS”) Sub-Industry as the Company, such company shall
no longer be a Peer Company.

(B)  In the event of a merger, acquisition or business combination transaction
of a Peer Company with or by another Peer Company, the surviving entity shall
remain a Peer Company, without adjustment to its financial or market structure,
provided that the surviving entity is still in the same GICS Sub-Industry as the
Company.

(C)  In the event of a merger of a Peer Company with or by an entity that is not
a Peer Company, or the acquisition or business combination transaction of a Peer
Company with an entity that is not a Peer Company, in each case, where the Peer
Company is the surviving entity, the surviving entity shall remain a Peer
Company, without adjustment to its financial or market structure, provided that
the surviving entity is still in the same GICS Sub-Industry as the Company.

(D)  In the event of a merger or acquisition or business combination transaction
of a Peer Company with or by an entity that is not a Peer Company, other form of
“going private” transaction relating to any Peer Company or the liquidation of
any Peer Company, where such Peer Company is not the surviving entity or is
otherwise no longer publicly traded, the company shall no longer be a Peer
Company.

(E)  In the event of a bankruptcy of a Peer Company, such company shall remain a
Peer Company, without adjustment to its financial or market condition.

(n)           “Performance Period” means the three-year period over which Common
Stock Price Appreciation is measured.  In the event that the last day of a
Performance Period falls on a weekend or any other day on which the Nasdaq Stock
Market is not open, the Performance Period shall end on the next following
Nasdaq Stock Market business day.

 
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(o)           “Performance Share” means a right to receive on the Settlement
Date one (1) Common Share, subject to further restrictions as provided by this
Agreement.

(p)           “Retirement” means the Participant’s termination of Service with
the Company and its Affiliates on or after attainment of age 65.

(q)           “Section 409A” means Section 409A of the Code and any applicable
regulations or administrative guidelines promulgated thereunder.

(r)           “Section 409A Deferred Compensation” means compensation payable
pursuant to the Award granted to a Participant subject to United States income
taxation that constitutes nonqualified deferred compensation for purposes of
Section 409A.

(s)           “Service” means the Participant’s employment with the Company and
its Affiliates.  The Participant’s Service will be considered to have ceased
with the Company and its Affiliates if, immediately after a sale, merger or
other corporate transaction, the trade, business or entity with which the
Participant are employed or otherwise have a service relationship is not Forward
Air Corporation or an Affiliate of Forward Air Corporation.

(t)           “Settlement Date” means the date so specified on the Grant Notice;
provided, however, that in the event of termination of the Participant’s Service
by reason of death or Disability, the term “Settlement Date” shall mean the
sixtieth (60th) day after the day on which the Participant’s Service terminates.

{End of Agreement}
 
 
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