EXHIBIT 10.3
 
 
FFE TRANSPORATION SERVICES, INC.
 
 
 AMENDED 2005 EXECUTIVE BONUS AND RESTRICTED STOCK PLAN
 
 

 
This Executive Bonus and Restricted Stock Plan (hereafter this “Plan”), dated as
of January 1, 2005 (the “Effective Date”), is hereby amended as of February 25,
2009 by FFE Transportation Services, Inc., a Delaware corporation (“FFE”) which
is a wholly-owned subsidiary of FFE, Inc. (“Inc.”), a Delaware corporation which
is a wholly-owned subsidiary of Frozen Food Express Industries, Inc.
(“Industries”), a Texas corporation, for the benefit of certain officers of FFE.
 
 
PURPOSE
 
FFE has established this Plan for the benefit of specified officers of FFE in
order to enhance the benefits to the covered officers, allow the officers to
share in the growth of FFE through the appreciation in the value of the common
stock of Industries, and to provide the officers with greater incentive to
promote the grown of Industries’ shareholder value.  The purpose of the Plan is
to align the financial interests of key officers of FFE with those of
Industries’ shareholders through the use of awards, payable in the common stock
of Industries, upon the attainment of predetermined performance goals.
 
 
TERMS
 
 
1. DEFINITION.  For the purposes of this Plan, the following terms shall have
the meanings set forth below:
 
 
(a) The term “Committee” shall mean a committee of the Board of Directors of
Industries, which shall consist of not less than two persons who are
“Non-Employee Directors” as defined in Rule 16b-3(b)(3) under the Securities
Exchange Act of 1934 and who meet such additional criteria as the Board of
Directors of Industries shall determine so that any incentive bonuses paid
pursuant to this Plan shall be exempt from the limitation set forth in Section
162(m) of the Internal Revenue Code of 1986, as amended.
 
 
(b) The term “Compensation” shall mean a Participant’s base compensation (as
determined by the Committee) for the specified period and shall exclude any
non-recurring compensation such as bonus payments.
 
 
(c) The term “Fair Market Value” shall mean the closing sales price of the
securities per share, as reported in the Wall Street Journal (or, if not so
reported, as otherwise reported by the National Association of Securities
Dealers Automated Quotation System) as of the date in question.
 
 
 

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(d) The term pre-tax income shall mean total revenues less total operating
expenses including interest income, gains (losses) from the sale of equipment
and other non-operating expenses for Frozen Food Express Industries, Inc.
Pre-tax income may be adjusted by the Committee for such specific items, if any,
that the Committee in its sole discretion deems appropriate.
 
 
(e) The term “Participant” shall mean each officer of FFE, including without
limitation, any officer of Industries that is an officer of FFE, whose name is
set forth on Exhibit A.
 
 
2. DETERMINATION OF BONUS.  With respect to each fiscal year commencing with
fiscal year 2005, each Participant shall be entitled to an incentive bonus
(“Bonus”) calculated pursuant to a formula determined on the basis of such
Participant’s pre-tax income targets and specified percentages of such
Participant’s Compensation, if the Committee certifies that the applicable
target has been obtained.  The targets and percentages for all Participants are
shown on Exhibit A attached to this Plan.  On or before the last day of any
fiscal year, the Committee may, in its sole discretion, redetermine who will be
a Participant (provided that such person must be an officer of FFE) for the
subsequent fiscal year and the pre-tax targets and percentages to be used to
calculate the Participants’ Bonuses for the subsequent fiscal year by amending
Exhibit A attached to this Plan.
 
 
3. PAYMENT OF BONUS AND ISSUANCE OF RESTRICTED STOCK.
 
 
(a) Each Participant’s Bonus for any fiscal year shall be paid by FFE to such
Participant as soon as practicable after the consolidated financial statements
of Industries for such fiscal year have been prepared.  [Note:  Section 409A
will require either that (i) the bonus be paid within 2 ½ months after the close
of the fiscal year, or (ii) if paid at a later date, then the payment date must
be a fixed date, ie., on May 1, and cannot be accelerated.]
 
 
(b) In addition to the payment of any Bonus to a Participant, FFE shall award
shares of Restricted Stock to each Participant under the Industries’ 2005 Stock
Incentive Plan (the “Stock Incentive Plan”).  The number of shares of Restricted
Stock shall be equal to 50% of the amount of the Participant’s Bonus for that
fiscal year divided by the applicable Share Value.  The applicable Share Value
shall mean the amount that is the lower of (i) the Fair Market Value of a share
of Stock as of the last business day of the fiscal year immediately preceding
the fiscal year for which the Participant’s Bonus was awarded and (ii) the
average of the Fair Market Values of a share of Stock as of the last business
day of each calendar month of the fiscal year for which the Participant’s Bonus
was awarded.
 
 
(c) Shares of Restricted Stock shall be awarded to a Participant as of the last
business day of the fiscal year for which the Participant’s Bonus was awarded
(the “Grant Date”).
 
 
(d) If the specified bonus percentage for a Participant’s pre-tax income for any
fiscal year is a negative number, no award for the fiscal year will be made.
 

 
 

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4. VESTING OF RESTRICTED STOCK.
 
 
(a) The shares of Restricted Stock awarded to Participants shall vest over a
three-year period, one-third on each anniversary of the Grant Date, provided
that the Participant remains employed by FFE or a related corporation on the
vesting date.  The vesting period may be adjusted as the Committee deems
appropriate at its sole discretion.
 
 
(b) If a Participant dies while employed by FFE or a related corporation, 100%
of his shares of Restricted Stock awarded under this Plan shall become vested.
 
 
(c) The terms and conditions of the Restricted Stock award shall be set forth in
an Award Agreement and shall be subject to the provisions of the Stock Incentive
Plan.
 
 
5. NON-TRANSFERABILTY.  Neither the shares of Restricted Stock nor any rights
and benefits granted in this Plan may be transferred, assigned, pledged, or
hypothecated in any manner, by operation of law or otherwise, other than by will
or by the laws of descent or distribution or pursuant to a qualified domestic
relations order as defined by the Internal Revenue Code of 1986, as amended
(“Internal Revenue Code”), or Title I of the Employee Retirement Income Security
Act of 1974, as amended, or the rules thereunder, and shall not be subject to
execution, attachment, or similar process.
 
 
6. NO FIDUCIARY RELATIONSHIP.  The Boards of Directors and the officers of FFE,
Industries and Inc. shall have no duty to manage or operate in order to maximize
the benefits granted to the Participants hereunder, but rather shall have full
discretionary power to make all management and operational decisions based on
their determination of their respective best interest.  This Plan shall not be
construed to create a fiduciary relationship between such Boards or the officers
of FEE, Industries or Inc. and the Participant.
 
 
7. GOVERNING LAW.  This Plan shall be governed by and construed in accordance
with the laws of the State of Texas.
 
 
8. NO EMPLOYMENT GUARANTEE.  Nothing in this Plan shall be construed as an
employment contract or a guarantee of continued employment.  The rights of any
Participant shall only be those as are expressly set forth in this Plan.
 
 
9. ADMINISTRATION.  The Committee shall administer this Plan and shall have the
authority, in its sole and absolute discretion, (a) to adopt, amend and rescind
administrative and interpretative rules and regulations relating to the Plan,
(b) to determine the Participants and the terms under which they may participate
in this Plan, (c) to make all other determinations, perform all other acts, and
exercise all other powers and authority necessary or advisable for administering
the Plan, including the delegation of those ministerial acts and
responsibilities as the Committee deems appropriate.
 
 
10. TAXES.  FFE shall be entitled to deduct from amounts payable hereunder any
sums required by federal, state, or local tax law to be withheld with respect to
such payments.
 
 
 
 

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11. AMENDMENT.  In addition to the amendments to this Plan contemplated by
Section 2, the Board of Directors may amend or terminate this Plan in its sole
discretion.
 
 
12. GENERAL CREDFITOR STATUS.  The Participants shall, in no event, be regarded
as standing in any position, if at all, other than as a general creditor of FFE
with respect to any rights derived from the existence of this Plan and shall
receive only FFE’s unfunded and unsecured promise to pay benefits under this
Plan.
 
 
13. CAPTIONS.  The captions in this Plan are inserted for convenience of
reference only and in no way define, describe or limit the scope or intent of
this Plan or any of the provisions hereof.
 
 
14. SEVERABILITY.  If any provision of this Plan is held to be illegal, invalid
or unenforceable under present or future laws, such provision shall be fully
severable and shall not invalidate the remaining provisions of this Plan, and
the remaining provisions of this Plan shall remain in full force and effect and
shall not be affected by the illegal, invalid or unenforceable provision or by
its severance from this Plan.
 
 
15. COSTS.  All expenses and costs incurred in connection with the operation of
this Plan shall be borne by FFE.
 
IN WITNESS WHEREOF, Frozen Food Express Industries, Inc., acting by and through
its officer hereunto duly authorized, has executed this instrument, this the
25th day of February, 2009.
 

 

 

 
FROZEN FOOD EXPRESS INDUSTRIES, INC.
 
By:     /s/ Stoney M. Stubbs Jr
 
Name:    Stoney M. Stubbs Jr
 
Date:    2/25/09

 

 
 

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INCENTIVE BONUS CALCULATION
 
Participants:  Stoney M. (Mit) Stubbs, S. Russell Stubbs., John Hickerson and
Ron Knutson
 
Pre-tax Income and Bonus Percentages Applicable to all Participants:
 

 

 
 
Pre-tax Income
Participant’s
Bonus Percentage
   
$1,500,000
15%
   
$3,000,000
30%
   
$5,000,000
50%
   
$7,500,000
70%
   
$10,000,000
80%
   
$12,500,000
90%
   
$13,100,000
100%
   
$14,000,000 or greater
125%
 

 
The participant’s earned bonus percentage shall be extrapolated between the
established target levels.