Document:

NCEX 10.29 MLMCConsentandAgreement

Exhibit 10.29

Execution Version

CONSENT AND AGREEMENT

Dated as of December 20, 2002

made by and among

MISSISSIPPI LIGNITE MINING COMPANY,

CHOCTAW GENERATION LIMITED PARTNERSHIP,

SE CHOCTAW, L.L.C.,
as Owner Lessor

and 

CITIBANK,  N.A.,
as Lease Indenture Trustee

This  CONSENT   AND   AGREEMENT   (this   "Consent   and  Agreement")    dated   as   of December 20, 2002 is  entered  into  by  and  among  MISSISSIPPI  LIGNITE  MINING  COMPANY , a Texas  joint   venture   between  The  North  American  Coal  Corporation  and  its  wholly   owned subsidiary, Red Hills Property Company L.L.C. (the "Contracting Party"), CHOCTAW GENERATION LIMITED PARTNERSHIP , a limited partnership duly organized and validly existing under the laws of the State  of Delaware (the "Project Company") , SE CHOCTAW , L.L.C., a limited liability company duly organized and validly existing under the laws of the State of Delaware, (the "Owner Lessor") , and CITIBANK , N.A., in its capacity as Lease Indenture Trustee under the Lease Indenture referred to  below (together with its successors in such capacity, the "Lease Indenture Trustee").

WHEREAS the Contracting Party and the Project Company are parties to a Lignite Sales Agreement dated as of April 1, 1998, as amended by the Letter Agreements dated February 1, 2001, September 21, 2001, December 10, 2001, April 29, 2002, July 19, 2002 and July 30, 2002, all between Contracting Party and the Project Company, and by Paragraph 2 of the Settlement Agreement and Release made and entered into as of October 17, 2002 between Contracting Party and the Project Company, and as it may be further amended from time to time (the "Lignite Sales Agreement");

WHEREAS in accordance with the terms of the Lignite Sales Agreement, the Contracting Party entered into a Subordinated Deed of Trust , Security Agreement and Financing Statement in favor of Jim B. Tohill, as Trustee for the benefit of the Project Company, dated as of September 17, 1998 and recorded September 24, 1998 in Mortgages Book 135, Pages 129-162 as it may be amended from time to time (the "Subordinated Deed of Trust”);

WHEREAS the Contracting Party, the Project Company and the Tennessee Valley Authority ("TVA") are parties to a Three-Way Arbitration Agreement dated as of April 1, 1998 (the "Three-Way Arbitration Agreement" and together with the Lignite Sales Agreement and Subordinated Deed of Trust, as each may heretofore or hereafter be amended, supplemented or modified and in effect from time to time, the "Assigned Agreements");

WHEREAS the Project Company intends to enter into a leveraged lease transaction pursuant to which, among other things: (i) the Owner Lessor will purchase from the Project Company, and the Project Company will sell and assign to the Owner Lessor, all of the Project Company's right, title and interests in the Project (as defined in Appendix A attached hereto), and (ii) the Owner Lessor will enter into a lease with the Project Company pursuant to which the Owner Lessor will lease the Project to the Project Company (the "Lease");

WHEREAS the Owner Lessor intends to fund a portion of the purchase price for the Project with non-recourse indebtedness that will be advanced to the Owner Lessor by certain pass through trusts as contemplated in the Participation Agreement (the "Participation Agreement ") to be entered into by and among the Project Company, the Owner Lessor, SE CHOCTAW II, L.L.C., a limited liability company duly organized and validly existing under the laws of the State of Delaware (the "Owner Participant"), and CITIBANK , N.A. in its capacity as the Pass Through Trustees and the Lease Indenture Trustee;

WHEREAS pursuant to the Security Agreement to be entered into between the Project Company and the Owner Lessor (the "Security Agreement") in connection with the leveraged lease transaction, the Project Company intends to assign, grant and pledge to the Owner Lessor a security interest in all right, title and interest of the Project Company in, to and under, among other things, the Lignite Sales Agreement and the Three-Way Arbitration Agreement as collateral security for the prompt and complete payment and performance of the obligations of the Project Company under the Operative Documents;

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WHEREAS pursuant to the Assignment of Subordinated Deed of Trust to be entered into between the Project Company and the Owner Lessor and recorded in the public records of the State of Mississippi (the "Assignment of Subordinated Deed of Trust") in connection with the leveraged lease transaction, the Project Company will assign to the Owner Lessor as collateral security all the estate, right, title and interest of the Project Company in, to and under the Subordinated Deed of Trust, and all amendments, supplements, substitutions and renewals thereto; and

WHEREAS pursuant to the Indenture of Trust and Security Agreement, dated as of October 31, 2002 , between the Owner Lessor and the Lease Indenture Trustee (the "Lease Indenture") , the Owner Lessor will (i) issue notes to the Pass Through Trustees as evidence of the Owner Lessor's obligations under the Lease Indenture (the "Lessor Notes") and (ii) as collateral security for the prompt and complete payment and performance when due of the Owner Lessor's obligations under the Lessor Notes, pledge, assign, and grant to the Lease Indenture Trustee, pursuant to the Lease Indenture for the benefit of the  Pass  Through Trustees, a first lien and continuing first priority security interest in, among other things, all of the Owner Lessor's right, title and interest in the Assigned Agreements.

NOW, THEREFORE, for and in consideration of the mutual rights and obligations undertaken in this Consent and Agreement, the parties hereto agree as follows:

1.    Definitions.  Unless otherwise specified herein, capitalized terms used in this Agreement shall have the meanings assigned to such terms in Appendix A hereto. Unless otherwise stated, references herein to any Person shall include its permitted successors and assigns and, in the case of any Governmental Authority, any Person succeeding to its functions and capacities.

2.    Representations and Warranties. The Contracting Party hereby represents and warrants that:

		
	(a)
	The Contracting Party  is a joint venture between The North American Coal Corporation and its wholly owned subsidiary Red Hills Property Company L.L.C. and is duly organized, validly existing and in good standing under the laws of the State of Texas. The Contracting Party is duly qualified to do business and is in good standing in all jurisdictions where necessary in light of the business it conducts and the property it owns and intends to conduct and own and in light of the transactions contemplated by the Assigned Agreements. No filing, recording, publishing or other act that has not been made or done is necessary or desirable in connection with the existence or good standing of the Contracting Party or the conduct of its business.

		
	(b)
	The Contracting Party has the  full power, authority and legal right to execute, deliver and perform its obligations hereunder and under the Assigned Agreements. The execution, delivery and performance by the Contracting Party of this Consent and Agreement and the Assigned Agreements and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary member, corporate and shareholder action. This Consent and Agreement and the Assigned Agreements have been duly executed and delivered by the Contracting Party and constitute the legal, valid and binding obligations of the Contracting Party enforceable against the Contracting Party in accordance with their respective terms, except as the enforceability thereof may be limited by (i) applicable bankruptcy, insolvency, moratorium or other similar laws affecting the enforcement of creditor's rights generally and (ii) the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity).

		
	(c)
	The execution, delivery and performance by the Contracting Party of this Consent  and Agreement  and the Assigned  Agreements  do  not and will not (i) require any consent or approval of the board of directors or governing body of the Contracting Party or any 

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shareholder, partner or member of the Contracting Party or of any other Person which has not been obtained and each such consent or approval that has been obtained is in full force and effect,  (ii)  violate  any  provision  of  any  law,  rule,  regulation, order, writ, judgment, decree, determination or award having applicability to the Contracting Party or any provision of the joint venture agreement of the Contracting Party, (iii) conflict with, result in a breach of or constitute a default under any provision of the joint venture agreement or any resolution of the management committee of the Contracting Party or any indenture or loan or credit agreement or any other agreement,  lease  or  instrument  to which the  Contracting  Party is a party or by which the Contracting Party or its properties and assets are bound or affected or (iv) result in, or require the creation or imposition of, any Lien upon or with respect to any of the assets or properties of the Contracting Party now owned or hereafter acquired. The Contracting Party is not in violation of any such law, rule or regulation, order, writ, judgment, decree, determination  or award referred to in clause (ii) above or its joint venture agreement or in breach of or default under any provision of its joint venture agreement or any material agreement, lease or instrument referred to in clause (iii) above.

		
	(d)
	All Governmental Approvals required for the execution, delivery or performance of this Consent and Agreement and the Assigned Agreements by the Contracting Party have been validly issued and duly obtained, taken or made, are not subject to any condition other than as set forth in such Governmental Approvals, and the compliance with such conditions as are set forth in such Governmental Approvals would not be inconsistent with the performance obligations of the Contracting Party under the Assigned Agreements, do not impose restrictions or requirements inconsistent with the terms hereof or of the Assigned Agreements, are in full force and effect and are not subject to appeal; provided, however, that the Contracting Party recognizes that some permits and approvals that are part of the Governmental Approvals are limited in scope of area or time and will require renewal or extension over the course of the term of the Assigned Agreements and which renewals or extensions the Contracting Party believes will be obtained in the ordinary course of business.

		
	(e)
	This Consent and Agreement and (assuming the due authorization, execution and delivery by, and binding effect on, the Project Company, the Owner Lessor and the Lease Indenture Trustee) the Assigned Agreements are in full force and effect.

		
	(f)
	There is no action, suit or proceeding at law or in equity by or before any Governmental Authority, arbitral tribunal or other body now pending or to the best knowledge of the Contracting Party, threatened against or affecting the Contracting Party or any of its properties, rights, assets or condition (financial or otherwise) which (i) if adversely determined, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect or (ii) question the validity, legality, binding effect or enforceability hereof or of the Assigned Agreements or any action taken or to be taken pursuant hereto or thereto or any of the transactions contemplated hereby or thereby, other than, in the case of clauses (i) and (ii) above, those actions, suits or proceedings at law or in equity listed on Schedule A hereto.

		
	(g)
	The Contracting  Party is not in default  under any material covenant or obligation under the Assigned Agreements, and no such default has occurred prior to the date hereof. To the knowledge of the Contracting Party and except as described on Schedule B hereto, the Project Company is not in default under any material covenant or obligation of the Assigned Agreements and, after giving effect to the assignment of the Assigned Agreements, and after giving effect to the acknowledgment of and consent to such assignments by the Contracting Party, there exists no event or condition which would constitute a default, or which would, with the giving of notice or lapse of time or both, 

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constitute a default under the Assigned Agreements.  The Contracting Party has no knowledge of any conditions precedent to the effectiveness of the Assigned Agreements that have not been satisfied, and will not make any claims that any such conditions precedents have not been satisfied or waived; provided however, that the Contracting Party is not hereby waiving any defaults under the Assigned Agreements. The Assigned Agreements have not been amended, modified or supplemented in any manner other than as described in the Recitals hereto.

		
	(h)
	This Consent and Agreement and the Assigned Agreements constitute and include all agreements entered into between the Contracting Party and the Project Company relating to, and required for the consummation of, the transactions contemplated by this Consent and Agreement and the Assigned Agreements.

3.    Consent and Agreement.   The Contracting   Party hereby consents to the assignment of the Assigned Agreements, and acknowledges and agrees that:

		
	(a)
	The Contracting Party hereby consents to (i) the assignment by the Project Company pursuant to the Security Agreement of all its right, title and interest in, to and under the Lignite Sales Agreement and Three-Way Arbitration Agreement to the Owner Lessor as collateral security for the Project Company's obligations under the Operative Documents, (ii) the assignment by the Project Company pursuant to the Assignment of Subordinated Deed of Trust of all the estate, right, title and interest of the Project Company in, to and under the Subordinated Deed of Trust, and all amendments, supplements, substitutions and renewals thereto, to the Owner Lessor as collateral security for the Project Company 's obligations under the Operative Documents, and (iii) the assignment by the Owner Lessor pursuant to the Lease Indenture of all its right, title and interest in, to and under the Security Agreement and the Assignment of Subordinated Deed of Trust (and, consequently, the Assigned Agreements) to the Lease Indenture Trustee as collateral security for the Owner Lessor's obligations under the Operative Documents.

		
	(b)
	The Owner Lessor or the Lease Indenture Trustee  and any respective assignee thereof shall be entitled to exercise any and all rights of the Project Company under the Assigned Agreements  in accordance with their terms upon and after the exercise by the Owner Lessor or the Lease Indenture Trustee, if applicable, of their rights as secured party under the Security Agreement and as assignee under the Assignment of Subordinated Deed of Trust and following written notice by the Owner Lessor or the Lease Indenture Trustee. Without limiting the generality of the foregoing, upon and after the exercise by the Owner Lessor or the Lease Indenture Trustee of their rights as secured party under the Security Agreement and as assignee under the Assignment  of Subordinated Deed of Trust and following written notice by the Owner Lessor or the Lease Indenture Trustee, if applicable, the Owner Lessor or the Lease Indenture Trustee and any respective assignee thereof shall have the full right and power to enforce directly against the Contracting Party all obligations of the Contracting Party under the Assigned  Agreements  and otherwise  to exercise  all  remedies  thereunder  and to make  all demands and give all notices and make all requests required or permitted to be made by the Project  Company  under the  Assigned  Agreements  all in accordance  with  the terms of the Assigned Agreements and this Consent and Agreement.

		
	(c)
	The Contracting Party will not, without the prior written consent of the Owner Lessor and, for so long as the Lien of the Lease Indenture has not been terminated or fully discharged, the Lease Indenture Trustee, (i) take any action to cancel, terminate or suspend payment or performance under, or consent to or accept any cancellation, 

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termination or suspension of payment or performance under, the Assigned Agreements other than any such cancellation, termination or suspension of performance as is expressly provided for in the Assigned Agreements or under applicable law, (ii) materially amend, supplement or otherwise modify the Assigned Agreements or (iii) petition, request or take any legal or administrative action which seeks or may reasonably expected to accomplish the foregoing items (i) or (ii). In addition, the Contracting Party will not, without the prior written consent of each of the Owner Lessor and the Lease Indenture Trustee, take any action to cancel, terminate or suspend payment or performance under the Assigned Agreements as a result of a default or event of default thereunder unless (x) the Contracting Party shall have delivered to each of the Owner Lessor and the Lease Indenture Trustee written notice specifying the nature of the default giving rise to such right of cancellation, termination or suspension (and, in the case of a payment default, specifying the amount thereof) and permitted each of the Owner Lessor and the Lease Indenture Trustee to cure such default, and (y) the Owner Lessor or the Lease Indenture Trustee fails to cure such default within the longer of (i) the same cure period as is provided to the Project Company to cure such default, with such cure period to commence upon the giving of such notice to the Owner Lessor and the Lease Indenture Trustee, or (ii) 90 days after the date of such notice provided, however, in the case of a payment default by the Project Company which is not cured within the period specified in clause (i) of this sentence, the Contracting Party shall have the right to suspend performance of its obligations to sell and deliver lignite to the Project Company under the Lignite Sales Agreement until such payment default is cured.  In furtherance of the foregoing, the Contracting Party agrees that, notwithstanding anything contained herein or in the Assigned Agreements to the contrary, upon the occurrence of a default under the Assigned Agreements that cannot by its nature be cured by the payment of money, the Contracting Party will not cancel or terminate the Assigned Agreements if, and for so long as, the Owner Lessor or the Lease Indenture Trustee, as applicable, shall be diligently seeking to cure such default or otherwise to institute foreclosure proceedings, or otherwise to acquire the Project Company's interest in the Assigned Agreements, and the Contracting Party shall grant the Owner Lessor or the Lease Indenture Trustee (as the case may be) a reasonable period of time to cure such default upon the occurrence of such foreclosure or acquisition.

		
	(d)
	The Contracting Party agrees to make all payments, if any, which are required to be made to the Project Company under the Assigned Agreements, directly to the Lease Indenture Trustee (or to the Owner Lessor, if the Lease Indenture Trustee has notified Contracting Party in accordance with this Consent and Agreement that the Lien of the Lease Indenture Trustee shall have been terminated and fully discharged) for deposit into the Revenue Account and the Project Company consents to this arrangement ; provided that if the Contracting Party fails to make any such payment directly to the Lease Indenture Trustee or the Owner Trustee, as provided in this paragraph, such failure shall not constitute a breach or default hereunder or under the Assigned Agreements.

		
	(e)
	The Contracting Party shall deliver to the Owner Lessor and, for so long as the Lien of the Lease Indenture has not been terminated or fully discharged, to the Lease Indenture Trustee, at the addresses set forth on the signature pages hereof, or at such other address as the Owner Lessor or the Lease Indenture Trustee may designate in writing from time to time to the Contracting Party, concurrently with the delivery thereof to the Project Company, a copy of each material notice, request or demand given by the Contracting Party pursuant to the Assigned Agreements; provided that the failure to provide such notice shall not constitute a breach or default hereunder or under the Assigned Agreements; provided, further, however, any notice, alleging or claiming a 

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default under the Assigned Agreements, sent from the Contracting Party directly to the Project Company shall not be effective against the Project Company, the Owner Lessor, or the Lease Indenture Trustee, until such time as the notice is delivered to the Owner Lessor and the Lease Indenture Trustee, if applicable.

		
	(f)
	In the event that the Owner Lessor, the Lease Indenture Trustee or their respective designee(s) succeeds to the Project Company's interest under the Assigned Agreements, whether by termination of the Lease, foreclosure or otherwise (a "Succession"), the Owner Lessor, the Lease Indenture Trustee or their respective designee(s), as appropriate in the circumstances, shall assume liability for all of the Project Company's obligations under the Assigned Agreements; provided however, that such liability shall not include any liability for claims of the Contracting Party against the Project Company (other than for payment defaults) arising from the Project Company's failure to perform during the period prior to the Owner Lessor's, Lease Indenture Trustee's or such designee(s)' succession, as the case may be, to the Project Company's interest in and under the Assigned Agreements. Except as otherwise set forth in the immediately preceding sentence, neither the Owner Lessor, the Owner Participant, the Lease Indenture Trustee or the Noteholders (individually or collectively), shall be liable for the performance or observance of any of the obligations or duties of the Project Company under the Assigned Agreements, and the collateral assignment of the Assigned Agreements pursuant to the Security Agreement shall not give rise to any duties or obligations whatsoever on the part of any of the Owner Lessor, the Owner Participant, the Lease Indenture Trustee or the Noteholders, individually or collectively, owing to the Contracting Party.

		
	(g)
	Upon the exercise by the Owner Lessor or the Lease Indenture Trustee of any  of their  respective  remedies  set forth  in the  Lease, the  Lease  Indenture  or the other Operative Documents, each of the Owner Lessor and the Lease Indenture Trustee may assign its rights and interests and the rights and interests of the Project Company under the Assigned Agreements to any purchaser or transferee of the Project (a "Transfer"), if such purchaser or transferee shall (i) assume all of the obligations of the Project Company under the Assigned Agreements, (ii) execute and deliver to the Contracting Party a written instrument under which it agrees to be bound by the provisions  of the Assigned Agreements  in all respects, and (iii) represent and warrant that the representations and warranties set forth in Section 11.02 of the Lignite Sales Agreement (or comparable representations) are true with respect to it as of the effective date of such transfer or assignment.  Upon such assignment and assumption, the Owner Lessor or the Lease Indenture Trustee, as applicable, shall be relieved of all obligations under the Assigned Agreements arising after such assignment and assumption. In the event of a Transfer or a Succession, the Contracting Party will continue to perform its obligations under the Assigned Agreements  in favor of the Owner Lessor, the Lease Indenture Trustee or their respective designee(s) or purchaser  or  transferee  of  the  Project  provided  there  is  no outstanding  event  of default  by Owner  Lessor  or the  Lease  Indenture  Trustee  under the Assigned Agreements which the Owner Lessor or the Lease Indenture Trustee (as the case may be) fails  to cure within  the applicable  cure period provided  herein  or in the Assigned Agreements.

		
	(h)
	In the event that (i) any Assigned Agreement is rejected by a trustee or debtor-in-possession in any bankruptcy or insolvency proceeding involving the Project Company or  (ii)  any Assigned Agreement  is terminated  as a result  of  any  bankruptcy  or insolvency proceeding involving the Project Company or otherwise pursuant to Section 13.01(c), (d), (e) or (f) of the Lignite Sales Agreement and, if within 90 days after such rejection or termination, the Owner Lessor, the Lease Indenture Trustee or their 

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respective designee(s) shall so request and shall certify in writing to the Contracting Party that it intends to perform the obligations of the Project Company as and to the extent required under any Assigned Agreement, and provided that  all existing  payment defaults  have  been cured,  the  Contracting  Party will execute and deliver to the Owner Lessor, the Lease Indenture Trustee or such designee(s)  a new Lignite Sales Agreement, Subordinated Deed of Trust or Three-Way Arbitration Agreement, which shall be for  the  balance  of  the  remaining  term  under  the  original  Lignite  Sales  Agreement, Subordinated Deed of Trust or Three-Way Arbitration Agreement, as applicable, before giving effect to such rejection or termination and shall contain the same conditions, agreements, terms, provisions and limitations as the original Lignite Sales Agreement, Subordinated Deed of Trust or Three-Way Arbitration Agreement (except for any requirements which have been fulfilled by the Project Company and  the Contracting Party prior to such rejection or termination). References in this Consent and Agreement to the "Assigned Agreements" shall be deemed also to  refer  to  the  new  Lignite  Sales  Agreement, Subordinated  Deed  of  Trust  or Three-Way Arbitration Agreement.

		
	(i)
	In the event that the Owner Lessor, the Lease Indenture Trustee or their respective designee(s), or any purchaser, transferee, grantee or assignee of the interests of the Owner Lessor, the Lease Indenture Trustee or their respective designee(s) in the Project assume or become liable under the Assigned Agreements  (as contemplated in subsection (f), (g) or (h) above or otherwise), liability in respect of any and all obligations of any such party under the Assigned Agreements shall be limited solely to recourse against such party (except that there shall be no such recourse against the Lease Indenture Trustee) and such party's interest in the Project (and no officer, director, employee, shareholder or agent thereof shall have any liability with respect thereto).

		
	(j)
	Except as provided in Sections 3(c), 3(d), 3(e), and 4 and unless and until the Contracting Party receives a Default Notice, the Contracting Party shall deal exclusively with the Project Company in connection with the performance of the Contracting Party's obligations under the Assigned Agreements. From and after such time as the Contracting Party receives a Default Notice and until a Transfer, the Contracting Party shall (a) so long as the Lessor Notes issued by the Owner Lessor are outstanding, deal exclusively with the Lease Indenture Trustee or the entity appointed by the Lease Indenture Trustee (if such entity has been so appointed) in connection with the performance of the Contracting Party's obligations under the Assigned Agreements, and (b) from and after such time as the Lessor Notes issued by the Owner Lessor are no longer outstanding and all obligations thereunder  have been satisfied, deal exclusively with the Owner Lessor or the entity appointed by the Owner Lessor (if such entity has been so appointed) in connection with the performance of the Contracting Party's obligations under the Assigned Agreements.

4.    Arrangements Regarding Payments. Subject to the proviso in Section 3(d), all payments to be made by the Contracting Party to the Project Company under the Assigned Agreements shall be made in lawful money of the United States, directly to the Lease Indenture Trustee (or the Owner Trustee, as applicable, as provided in Section 3(d)), for deposit into the Revenue Account (Account No. 104482) at the principal office of the Lease Indenture Trustee at Citibank, N.A., 111 Wall Street, 14th Floor, Zone 3, New York, New York, 10043, Attention:  John Byrnes, or to such other Person and/or at such other address as the Lease Indenture Trustee may from time to time specify in writing to the Contracting Party for application by the Lease Indenture Trustee in the manner contemplated in the Lease Indenture and the other Operative Documents, and shall be accompanied by a notice from the Contracting Party stating that such payments are made under the Assigned Agreements.  The Project Company hereby consents to this arrangement.

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5.    Miscellaneous.

		
	(a)
	No failure on the part of the Contracting Party, Project Company, the Owner Lessor, the Lease Indenture Trustee or any of their respective agents to exercise and no delay in exercising, and no course of dealing with respect to, any right, power or privilege hereunder shall operate as a waiver thereof, and no single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or an exercise of any other right, power or privilege. The remedies provided herein are cumulative and not exclusive of any remedies provided by law.

		
	(b)
	All notices, requests and other communications provided for herein and under the Assigned Agreements (including, without limitation, any modifications of, or waivers or consents under, this Consent and Agreement) shall  be given or made in writing (including, without limitation, by telex or telecopy) delivered to the intended recipient at the "Address for Notices" specified below its name on the signature pages hereof or, as to any party, at such other address as shall be designated by such party in a notice to each other party. Except as otherwise provided in this Consent and Agreement, all such communications shall be deemed to have been duly given when transmitted by telex or telecopier or personally delivered or, in the case of a mailed notice, upon receipt, in each case given or addressed as aforesaid.

		
	(c)
	This Consent and Agreement may be amended, waived or modified only by an instrument in writing signed by the Project Company, Contracting Party, the Owner Lessor and, for so long as the Lien of the Lease Indenture has not been terminated or fully discharged, the Lease Indenture Trustee, acting with the consent of the appropriate Noteholders; provided that no amendment, modification or waiver shall, unless by an instrument in writing signed by the Contracting Party, the Project Company, the Owner Lessor and, for so long as the Lien of the Lease Indenture has not been terminated or fully discharged, all of the Noteholders or by the Lease Indenture Trustee acting with the consent of all of the Noteholders, alter the terms of this Section 5(c). Any waiver shall be effective only for the specified purpose for which it was given.

		
	(d)
	This Consent and Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of each of the Contracting Party, the Project Company, the Owner Lessor, the Owner Participant, and, for so long as the Lien of the Lease Indenture has not been terminated or fully discharged, the Lease Indenture Trustee and the Noteholders (provided, however, that the Contracting Party and the Project Company shall not assign or transfer their respective rights hereunder without the prior written consent of the other, the Owner Lessor and, so long as the Lien of the Lease Indenture has not been terminated or fully discharged, the Lease Indenture Trustee, except to a party to whom it transfers (and is entitled without the consent of the other, the Owner Lessor and the Lease Indenture Trustee to transfer) its rights under the Assigned Agreements).

		
	(e)
	This Consent and Agreement may be executed in any number of counterparts, all of which when taken together shall constitute one and the same instrument and any of the parties hereto may execute this Consent and Agreement by signing any such counterpart. This Consent and Agreement shall become effective at such time as the Lease Indenture Trustee shall have received counterparts hereof signed by all of the intended parties hereto.

		
	(f)
	If any  provision hereof  is invalid and unenforceable  in any jurisdiction , then, to the fullest extent  permitted by law, (a) the other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally construed in order to carry out the 

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intentions of the parties hereto as nearly as may be possible and (b) the invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction.

		
	(g)
	Headings appearing herein are used solely for convenience and are not intended to affect the interpretation of any provision of this Consent and Agreement.

		
	(h)
	EACH  OF THE CONTRACTING  PARTY, THE  PROJECT  COMPANY, THE OWNER  LESSOR AND THE LEASE INDENTURE TRUSTEE HEREBY SUBMITS TO THE  NON-EXCLUSIVE JURISDICTION OF THE  UNITED STATES  DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS AND ANY COURT OF APPEALS  THEREOF  FOR THE PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS CONSENT  AND  AGREEMENT. THE  AGREEMENTS OF THE  PARTIES HERETO ARE SOLELY FOR THE BENEFIT OF THE CONTRACTING  PARTY, THE PROJECT COMPANY, THE OWNER LESSOR, THE OWNER PARTICIPANT, THE LEASE INDENTURE TRUSTEE AND THE NOTEHOLDERS, AND NO PERSON (OTHER THAN THE PARTIES HERETO, THE OWNER  PARTICIPANT, THE NOTEHOLDERS AND THEIR SUCCESSORS AND ASSIGNS PERMITTED HEREUNDER) SHALL HAVE ANY RIGHTS HEREUNDER.

		
	(i)
	THIS CONSENT AND AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF TEXAS.

		
	(j)
	EACH OF THE CONTRACTING PARTY, THE PROJECT COMPANY, THE OWNER LESSOR, AND THE LEASE INDENTURE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS CONSENT AND AGREEMENT OR THE ASSIGNED AGREEMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

		
	(k)
	For purposes of this Consent and Agreement, the Contracting Party may conclusively presume that (i) the Lien of the Lease Indenture has not been terminated or fully discharged until the Contracting Party shall have received written notice of such termination or discharge from the Lease Indenture Trustee and (ii) the Lessor Notes issued by the Owner Lessor remain outstanding and all obligations thereunder have not been satisfied until the Contracting Party shall have received written notice from the Lease Indenture Trustee that the Lessor Notes are no longer outstanding and all obligations thereunder have been satisfied.

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IN WITNESS WHEREOF, the undersigned by its representatives or officer duly authorized has caused this Consent and Agreement to be duly executed and delivered as of the date first written above.

	
			
	 
	MISSISSIPPI LIGNITE MINING COMPANY

	 
	By Its Joint Venturers:

	 
	 
	 

	 
	THE NORTH AMERICAN COAL CORPORATION:

	 
	 
	 

	 
	By:
	/s/ Clifford R. Miercourt

	 
	Name:
	Clifford R. Miercourt

	 
	Title:
	President and Chief Executive Officer

	 
	 
	 

	 
	Officer Address for Notices:

	 
	 

	 
	14785 Preston Road, Suite 1100

	 
	Dallas, Texas  75254-7891

	 
	Telecopier No.: (972) 387-1031

	 
	Telephone No.: (972) 239-2625

	 
	Attention: Thomas A. Koza

	 
	Vice President-Law and Administration, and Secretary

	
			
	 
	RED HILLS PROPERTY COMPANY L.L.C.:

	 
	 
	 

	 
	By:
	/s/ Thomas A. Koza

	 
	Name:
	Thomas A. Koza 

	 
	Title:
	Manager

	 
	 
	 

	 
	Address for Notices:

	 
	14785 Preston Road, Suite 1100

	 
	Dallas, Texas  75254-7891

	 
	Telecopier No.: (972) 387-1031

	 
	Telephone No.: (972) 239-2625

	 
	Attention: Manager

11

	
		
	CHOCTAW GENERATION LIMITED PARTNERSHIP

	 
	 

	By Choctaw Generation, Inc., as general partner

	 
	 

	By:
	 /s/  Rachel W. Kilpatrick

	Name:
	Rachel W. Kilpatrick

	Title:
	Vice President and Treasurer

	 
	 

	Choctaw Generation Limited Partnership

	1177 West Loop South, Suite 900

	South Houston, TX 77027

	Telecopier No.: (713) 599-2858

	Telephone No.: (713) 599-2656

	Attention: General Counsel

	
		
	SE CHOCTAW, L.L.C.,

	as Owner Lessor

	By: Wilmington Trust Company,

	As Owner Manager

	 
	 

	By:
	/s/  W. Chris Sponenburg 

	Name:
	W. Chris Sponenburg

	Title:
	Vice President 

	 
	 

	Address for Notices:

	 
	 

	SE Choctaw, L.L.C.

	c/o Wilmington Trust Company

	Rodney Square North

	1100 North Market Street

	Wilmington, Delaware 19890-0001

	Telephone No.: (302) 651-1000

	Facsimile No.: (302) 651-8882

	Attention: Corporate Trust Administration

11

	
		
	CITIBANK, N.A .,

	as Lease Indenture Trustee

	 
	 

	By:
	/s/  John J. Byrnes

	Name:
	John J. Byrnes

	Title:
	Vice President

	 
	 

	Address for Notices:

	 
	 

	Citibank, N.A.

	111 Wall Street

	14th Floor, Zone 3

	New York, New York  10043

	Telephone No.:  (212)  657-7838

	Facsimile No.:  (212)  657-3872

	Attention:  Global Agency & Trust

12

Appendix A to
Consent and Agreement

DEFINITIONS

"Default Notice" means a notice delivered to the Contracting Party by Owner Lessor or the Lease Indenture Trustee notifying the Contracting Party that a Lease Event of Default (as defined in the Lease) has occurred and is continuing and that the Owner Lessor or the Lease Indenture Trustee has elected to exercise their respective rights to terminate the Lease, or to exercise their respective rights and remedies with respect to repossession or sale of the Project in accordance with the Lease.

"Development" means, with respect to the Project, the ownership, occupation, construction, testing, starting, repair, operation, maintenance and use of the Project and the financing of the Project and the sale of electric power, steam or other products and by-products of the Project by the Project Company or its permitted successors or assigns.

"Facility" means a collective reference to (i) the approximately 440-megawatt nominally-rated coal-fired electric generating facility which has been constructed on the Facility Site by Bechtel Power Corporation, a Nevada corporation, and Becon Construction Company , Inc., a Texas corporation, and (ii) each of the other assets being transferred by the Project Company to the Owner Lessor pursuant to the Bill of Sale and Deed, but not including any Retained Assets (as defined in the Participation Agreement) .

"Facility Site" means the parcels of land described in Exhibit A to the Site Lease, and all rights of way, easements, permits and other appurtenances to such parcels, excluding any Released Interest (as defined in the Site Lease).

"Governmental Authority" means the government of the United States of America, or any political subdivision thereof, an state or local government, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

"Governmental Approval” means all authorizations , consents, approvals, waivers , exceptions, variances, franchises, permissions, filings, permits, orders, licenses, exemptions and declarations of or with any Governmental Authority and shall include those siting and operating permits and licenses, and any of the foregoing under any applicable environmental law, that are required for the use and operation of the Project.

"Lien" means, with respect to any asset, any mortgage, deed of trust, lien, pledge, charge, security interest or easement or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected or effective under applicable law, as well as the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such asset.

"Material Adverse Effect" means a material adverse effect on (a) the business, property, operations, financial condition, of the Contracting Party (b) the ability of the Contracting Party to perform  any  of  its  material  obligations  under the  Consent  and Agreement or the Assigned Agreements, or (c) the material rights of or benefits available to the Owner Lessor and the Lease Indenture Trustee under this Agreement or the Assigned Agreements.

"Noteholders" means holders of the Lessor Notes issued pursuant to the Lease Indenture, and shall include the holders of any certificates or similar instruments issued by any pass through trust that is the holder of a Lessor Note.

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"Operative Documents" means the Participation Agreement, the Bill of Sale, the Deed, the Facility Lease, the Memorandum of Lease, the Site Lease, the Recognition Agreement, the Memorandum of Site Lease, the Site Sublease, the Memorandum of Site Sublease, the Assignment and Assumption Agreements,  the Sub-Assignment  and Assumption Agreements, the Notes, the Pass Through Trust Agreement, the Certificates, the Certificate Purchase Agreement, the Depositary Agreement, the Lessee LP Agreement, the Tax Indemnity Agreement, the OP Guaranty, the Equity Investor Guaranty, if any, the Indemnity Agreement, the Tractebel Parent Guaranty, the Facility Support Agreement, the Ash Disposal Agreement and the Security Documents (all as defined in the Participation Agreement).

"Person" means any individual, corporation, cooperative, partnership, joint venture, association, joint-stock company, limited liability company, trust, unincorporated organization or government or any agency or political subdivision thereof.

"Project" shall mean the Facility, the Facility Site and all licenses, permits and easements and other real property interests and rights relating to the Facility or the Facility Site which are owned or leased by the Project Company or in which the Project Company has any rights, including, without limitation, any easements.

"Revenue Account" means Citibank, N.A. account number 104482, or any account established in substitution therefor pursuant to the terms of the Depositary Agreement (as defined in the Participation Agreement).

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SCHEDULE A TO CONSENT AND AGREEMENT

Project Company's Failure to Pay Contracting Party's Invoices- See Schedule B

Charge of Discrimination filed by Bill C.  Scott, Jr. with the Equal Employment Opportunity Commission, Charge No. 131A300 168

Contracting Party placed Mr. Scott on disability in the first half of 2002, because his diabetes prevented him from performing all of the essential functions of his position as a heavy equipment operator. At the Contracting Party's request, North Mississippi Medical Clinics had examined Mr. Scott and had recommended that he not operate heavy equipment, work rotating shifts or work alone because of his diabetes, all of which his job involved. After Mr. Scott went on disability, a job opening developed in the warehouse, and Mr. Scott asked to be placed in it. The Contracting Party declined to do so, because this position also involved shift work and required the candidate to work alone at times. Mr. Scott alleges that the Contracting Party's refusal to place him in the warehouse job violated the Americans with Disabilities Act. The Contracting Party believes that Mr. Scott's complaint is without merit.

Dispute with Tim Pruitt, et al. regarding Coal Lease

The lessors under a lease held by Contracting Party have refused to cash surface damage payment checks that the Contracting Party has issued to them, claiming that the payments did not properly compensate them for the value of trees the Contracting Party removed from their property to construct a sedimentation pond. The lessors were paid $19,825 for 30.5 acres of timber based on appraisals, but the lessors wanted $36,600. The lessors have notified the Contracting Party that if the Contracting Party does not pay them an amount they consider adequate for the trees removed and lease an additional tract from them, they will consider the existing lease to be terminated. The Contracting Party believes the existing lease is in full force and effect. The Contracting Party and the lessors are in negotiations for a lease covering the additional unleased tract and settlement of the issues relating to the existing lease and surface damage payments.

Dispute with Jerry Orr regarding Coal Lease

Mr. Orr is the lessor under a lease held by Contracting Party. He has refused to cash surface damage payment checks that Phillips Coal Company and the Contracting Party have sent him, claiming that Phillips Coal Company, from which the Contracting Party acquired the lease, failed to make a timely payment to extend the term of the lease.  The Contracting Party has notified Mr. Orr that it considers the lease to be in full force and effect. Mr. Orr's interest under the lease covers 11.34 acres.

SCHEDULE B
TO CONSENT AND AGREEMENT

Project Company's Failure to Pay Invoices

The Project Company unilaterally has adjusted Contracting Party's invoices for lignite sold under the Lignite Sales Agreement and has failed to pay the full amounts invoiced in 2002 for Adjusted Power Component Price. As of September  30,  2002  the  Project  Company  has  failed  to  pay  the  sum  of $503,044.79 to Contracting Party.

By written agreement, Project Company and Contracting Party agreed to extend until September 30, 2002 the time period in Section 18.01 of the Lignite Sales Agreement during which the parties are obligated to meet and engage in good faith discussions in an attempt to resolve their dispute with respect to the calculations of the Adjusted Power Component Price.

The parties have not been able to resolve this dispute, and Contracting Party notified Project Company by letter dated November 26, 2002 that Contracting Party was submitting this dispute to arbitration.Final Phantom Stock Plan

Exhibit 10.17.15

OLD DOMINION FREIGHT LINE, INC.
2012 PHANTOM STOCK PLAN
ARTICLE 1.    PURPOSE.  Old Dominion Freight Line, Inc. (as defined below, the “Company”) hereby adopts this 2012 Phantom Stock Plan.  The Plan is intended to qualify as a “top-hat” plan under ERISA, in that it is intended to be an “employee pension benefit plan” (as defined in Section 3(2) of ERISA) which is unfunded and provides benefits only to a select group of management or highly compensated employees of the Company.  The purposes of the Plan are:
(i)    To promote the long-term financial interests and growth of the Company by attracting and retaining key management employees with the training, experience, and ability to enable them to make a substantial contribution to the success of the business of the Company;
(ii)    To motivate the Participant by means of growth-related incentives to achieve the Company’s long range goals;
(iii)    To further the identity of interests of key management employees with those of the Company’s shareholders; and
(iv)    To allow each Participant to share in the potential increase in value of the Company following the date such Participant is granted Phantom Stock in accordance with the terms of the Plan and to assist each Participant with his or her retirement preparation goals.
ARTICLE 2.    DEFINITIONS.  In addition to other terms defined herein or in an Award Agreement, wherever used in this Plan, including ARTICLE 1 and this ARTICLE 2, the following terms shall have the meanings set forth below (unless the Administrator determines otherwise):
2.1.    “Administrator” means the Board of Directors or, upon its delegation, a committee of the Board (the “Committee”) comprised of two or more members of the Board, each of whom is a “non-employee director,” as defined in Rule 16b-3 adopted under the Exchange Act or otherwise in compliance with Rule 16b-3.  Further, to the extent required by Section 162(m) of the Code, the Committee shall be comprised of two or more “outside directors” (as such term is defined in Section 162(m) of the Code) or as may otherwise be permitted under Section 162(m) of the Code.  In addition, each Committee member shall qualify as an “independent director” under applicable stock exchange rules if and to the extent required.
2.2.    “Affiliate” means any majority-owned subsidiary of the Company and any other business entity which is controlled by, under common control with or controls the Company. 
2.3.    “Applicable Law” means any applicable laws, rules or regulations (or similar guidance), including but not limited to the Exchange Act, the Securities Act, the Code, ERISA and the listing or other rules of any applicable stock exchange. 
2.4.    “Award” means a grant of Phantom Stock.

2.5.    “Award Agreement” an agreement entered into between the Company and the Participant evidencing the terms of Phantom Stock and such other terms and conditions as may be determined by the Administrator.
2.6.    “Board” or “Board of Directors” means the Board of Directors of the Company.
2.7.    “Change of Control” means and will be deemed to have occurred on the earliest of the following dates which occurs after the Effective Date, as determined by the Administrator:
(a)    The date any person or group of persons (as defined in Section 13(d) and 14(d) of the Exchange Act) together with its affiliates, excluding employee benefit plans of the Company, is or becomes (or publicly discloses that such person or group is or has become), directly or indirectly, the “beneficial owner” (as defined in Rule 13d-3 promulgated under the Securities Exchange Act of 1934) of securities of the Company representing thirty-five percent (35%) or more of the combined voting power of the Company’s then outstanding voting securities; provided, however, that the event described in this subparagraph (a) shall not be deemed to be a Change of Control by virtue of the beneficial ownership, or the acquisition of beneficial ownership, of voting securities by (i) any employee benefit plan sponsored or maintained by the Company or by a person controlled by the Company; (ii) any underwriter (as such term is defined in Section 2(a)(11) of the Securities Act) that beneficially owns voting securities temporarily in connection with an offering of such securities; or (iii) any member of the family of Earl E. Congdon or John R. Congdon unless David S. Congdon, acting in good faith, provides written notice to the Company that David S. Congdon believes, and within twenty (20) business days after the Company receipt of David S. Congdon’s notice a majority of the independent members of the Board of Directors determines, that the beneficial ownership of voting securities by such family member creates a substantial threat to corporate policy and effectiveness.  For the purpose of clause (iii) above, “family” means any lineal descendent, including adoptive relationships, of Earl E. Congdon or John R. Congdon, any spouse of the foregoing and any trust established by or for the benefit of any of the foregoing, and “independent” shall have the meaning set forth in the corporate governance rules of the principal exchange on which the Company’s common stock is listed; or
(b)    The date when, as a result of a tender offer or exchange offer for the purchase of securities of the Company (other than such an offer by the Company for its own securities), or as a result of a proxy contest, merger, share exchange, consolidation or sale of assets, or as a result of any combination of the foregoing, individuals who at the beginning of any two (2)-year period during the term constitute the Board, plus new directors whose election or nomination for election by the Company’s shareholders is approved by a vote of at least two-thirds (2/3) of the directors still in office who were directors at the beginning of such two-year period (“Continuing Directors”), cease for any reason during such two-year period to constitute at least two-thirds (2/3) of the members the Board; or
(c)    The effective date of a merger, share exchange or consolidation of the Company with any other corporation or entity regardless of which entity is the survivor, other than a merger, share exchange or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or being converted into voting securities of the surviving or acquiring entity) at least sixty percent (60%) of the combined voting power of the voting securities of the Company or such surviving or acquiring entity outstanding immediately after such merger or consolidation; or

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(d)    The effective date of the sale or disposition by the Company of all or substantially all of the Company’s assets. 
2.8.    “Code” means the Internal Revenue Code of 1986, as amended, and rules and regulations issued thereunder.
2.9.    “Common Stock” means (i) the common stock of the Company, par value $0.10 per share, as adjusted as provided in ARTICLE 7, or (ii) if there is a merger, consolidation or other event or transaction and the Company is not the surviving corporation, the capital stock of the surviving corporation given in exchange for such Common Stock of the Company.
2.10.    “Company” means Old Dominion Freight Line, Inc., a Virginia corporation with its principal offices at Thomasville, North Carolina, together with any successor thereto.
2.11.    “Competitive Activity” means (i) the Participant’s participation in, engagement by, possession of a financial or other interest in or filling a position directly or indirectly with (whether individually or as an employee, agent, partner, shareholder, consultant, or otherwise), any enterprise or business if such enterprise or business competes with the business of the Company in any state in which the Company conducts its business; (ii) the solicitation by the Participant of any other person to engage in any of the foregoing activities; (iii) the solicitation of any employee of the Company to leave the employ of the Company, or to do business with any enterprise or business which competes with the business of the Company; (iv) the solicitation of any customer, vendor or supplier of the Company; or (v) breach of any confidentiality obligations or restrictions to which the Participant is subject.  The ownership of an interest constituting not more than two (2) percent of the outstanding debt or equity in a company whose securities are traded on a recognized stock exchange or traded on the over-the-counter market shall not be deemed financial participation in a competitor even though that company may be a competitor of the Company. 
2.12.    “Eligible Key Employee” shall mean an employee who is determined by the Administrator to (i) be in a position to affect materially the continued growth and prosperity of the Company by reason of the individual’s duties, responsibilities, personal capabilities, performance, potential or any combination of such factors, and (ii) be a management or highly compensated employee of the Company.  An individual will be treated as an employee of the Company if there exists between the individual and the Company the legal relationship of employer and employee.
2.13.    “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and rules and regulations issued thereunder.
2.14.    “Exchange Act” means the Securities Exchange Act of 1934, as amended, and any successor statutes or regulations of similar purpose or effect.
2.15.    “Fair Market Value” of a share of Common Stock as of a given date shall be established in good faith by the Administrator.  The Administrator may in its discretion use (i) the 50-day moving average of a share of Common Stock as reported on the principal stock exchange on which shares of the Common Stock are then traded (with such 50-day averaging period ending on the trading day immediately preceding such given date), or (ii) any other method as the Administrator may determine in good faith.  
2.16.    “For Cause” means one or more of the following, in each case as determined by the Administrator in its sole discretion: (i) the Participant’s conviction by a court of competent jurisdiction of, or pleading “guilty” or “no contest” to, theft, fraud or embezzlement from the Company; (ii) the 

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Participant’s conviction by a court of competent jurisdiction of, or pleading “guilty” or “no contest” to, a felony which constitutes a crime involving moral turpitude and results in material harm to the Company; (iii) willful and continued failure by the Participant to substantially perform his duties on behalf of the Company (other than any such failure resulting from the Participant’s Total Disability) for a period of at least thirty (30) consecutive days after a written demand for substantial performance has been delivered to the Participant by the Responsible Person (as defined below) which specifically identifies the manner in which the Responsible Person believes that the Participant has not substantially performed the Participant’s duties; (iv) willful misconduct or gross negligence by the Participant which is injurious to the Company; or (v) any diversion by the Participant for his personal gain of any clearly viable and significant business opportunity from the Company (other than with the prior written consent of the Board).  For purposes of this Section 2.16, an act, or failure to act, on the Participant’s part shall not be deemed “willful” if done, or omitted to be done, by the Participant in good faith and with reasonable belief that the Participant’s act, or failure to act, was in the best interest of the Company, and “Responsible Person” shall mean the Chief Executive Officer of the Company or such other executive officer of the Company who is the direct or indirect supervisor of the Participant.
2.17.    “Grant Date” means the date an Award is granted to a Participant.
2.18.    “Participant” means an Eligible Key Employee who has received an Award that has not been settled, cancelled or forfeited.
2.19.    “Person” means any individual, partnership, joint venture, corporation, company, firm, group or other entity.
2.20.    “Phantom Stock” means a contractual right to receive an amount in cash equal to the Fair Market Value of a share of Common Stock on the Settlement Date.
2.21.    “Plan” means the Old Dominion Freight Line, Inc.  2012 Phantom Stock Plan, as it may be amended and/or restated.
2.22.    “Securities Act” means the Securities Act of 1933, as amended, and any successor statutes or regulations of similar purpose or effect.
2.23.    “Settlement Date” means the first to occur of the following:
(i)    The date of the Participant’s termination of employment for any reason other than death, Total Disability or For Cause;
(ii)    The date of the Participant’s death while employed by the Company; or
(iii)    The date of the Participant’s termination of employment as a result of his Total Disability.
2.24.    “Total Disability” means, for purposes of this Plan, that a Participant (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company; provided, that the term 

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“Total Disability” shall be interpreted in a manner consistent with the term “disability” under Code Section 409A if and to the extent required under Code Section 409A.
2.25.    “Vesting Date” shall have the meaning given such term in ARTICLE 5 and/or in an individual Award Agreement. 
ARTICLE 3.    ADMINISTRATION OF THE PLAN.
3.1.    Duties and Powers of the Administrator.  The Plan shall be administered by the Administrator.  In addition to action by meeting in accordance with Applicable Law, any action of the Administrator may be taken by a written instrument signed by all of the members of the Administrator and any action so taken by written consent shall be as fully effective as if it had been taken by a majority of the members at a meeting duly called and held.  Subject to the provisions of the Plan, the Administrator shall have full and final authority, in its discretion, to take action with respect to the Plan including, without limitation, the authority to (i) determine the terms and provisions of Awards made pursuant to the Plan; (ii) to establish, amend and rescind rules and regulations for the administration of the Plan; and (iii) to construe and interpret the Plan and Award Agreements, the rules and regulations, and to make all other determinations deemed necessary or advisable for administering the Plan.  Subject to the claims procedures described in ARTICLE 13, the decisions and interpretations of the Administrator with respect to any matter concerning the Plan or any Award shall be final, conclusive, and binding on all parties who have an interest in the Plan or such Award.  Any such interpretations, rules, and administration shall be consistent with the basic purposes of the Plan.  No member of the Administrator shall be liable while acting as such for any action or determination made in good faith with respect to the Plan or any Award.  The members of the Board or Committee, as applicable, shall be entitled to indemnification and reimbursement in the manner and to the fullest extent provided in the Company’s articles of incorporation and/or bylaws and/or pursuant to Applicable Law.  No individual member of the Administrator shall have any right to vote or decide upon any matter relating solely to himself or to any of his exclusive rights or benefits under the Plan (except that such member may sign unanimous written consent to resolutions adopted or other actions taken without a meeting).
3.2.    Delegation.  Notwithstanding the other provisions of Section 3.1, the Administrator may delegate to one or more officers of the Company the authority to grant Awards, and to make any or all of the determinations reserved for the Administrator of the Plan and summarized in Section 3.1 with respect to such Awards, subject to any restrictions imposed by Applicable Law (including, but not limited to, Rule 16b-3 adopted under Section 16 of the Exchange Act and Section 162(m) of the Code), and such terms and conditions as may be established by the Administrator.  To the extent that the Administrator has delegated authority to grant Awards pursuant to this Section 3.2 to one or more officers of the Company, references to the Administrator shall include references to such officer or officers, subject, however, to the requirements of the Plan, Rule 16b-3, Section 162(m) of the Code and other Applicable Law.
3.3.    Expenses; Professional Assistance.  All expenses and liabilities incurred by the Administrator in connection with the administration of the Plan shall be borne by the Company.  The Administrator may employ attorneys, consultants, accountants, appraisers, brokers or other persons.  The Administrator, the Company and the officers and directors of the Company shall be entitled to rely upon the advice, opinions, or valuations of any such persons.
ARTICLE 4.    ELIGIBILITY.  An Award may be granted to an individual who satisfies each of the following eligibility requirements on the Grant Date:
(i)    The individual is an Eligible Key Employee.

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(ii)    The individual is selected by the Administrator as an individual to whom an Award shall be granted.  
ARTICLE 5.    AWARDS.
5.1.    Phantom Stock.  The maximum number of shares of Phantom Stock available for Awards under this Plan shall be 1,000,000, subject to adjustment as provided in ARTICLE 7.  Any shares of Phantom Stock subject to an Award which, for any reason, expires, is cancelled, is forfeited or is otherwise terminated without settlement as to such shares of Phantom Stock may again be subject to an Award granted under the Plan.  No shares of Common Stock shall be issued pursuant to the Plan and payments made under the Plan, if at all, shall be made solely in cash.
5.2.    Grant of Awards.  Subject to the provisions of ARTICLES 10 and 15, the Administrator may, in its sole and absolute discretion, at any time and from time to time grant shares of Phantom Stock to any Eligible Key Employee who has been selected by the Administrator to receive an Award.  The Administrator shall determine the number of shares of Phantom Stock to be granted, which may, in its sole and absolute discretion, vary for each Eligible Key Employee.  Each Award shall be evidenced by an Award Agreement containing such terms and conditions, not inconsistent with the Plan, as the Administrator shall approve.  
5.3.    Unit Accounts.  Any shares of Phantom Stock awarded to a Participant pursuant to an Award shall be credited to a Phantom Stock account to be maintained on behalf of such Participant.  Such account shall be debited by the number of shares of Phantom Stock with respect to which any payments are made pursuant to ARTICLE 6.
5.4.    Vesting.  Unless the Administrator determines otherwise, the following provisions shall apply: 
(i)    Each Award shall vest (each such date, a “Vesting Date”) with respect to twenty percent (20%) of the Phantom Stock subject to the Award on each anniversary of the Grant Date, commencing with the first anniversary of the Grant Date, such that the Award shall be fully vested on the fifth anniversary of the Grant Date; provided that (a) the Participant has been continuously employed by the Company or an Affiliate from the Grant Date until each respective Vesting Date; (b) the Participant has been continuously employed by the Company or an Affiliate for at least ten (10) years on the respective Vesting Date; and (c) the Participant has attained age 65 on the respective Vesting Date.  In the event that the Participant has not satisfied either of the conditions described in Section 5.4(i)(b) or Section 5.4(i)(c) on a respective Vesting Date, the Award shall vest on the later of the respective Vesting Date or the date on which the Participant satisfies both of the conditions described in Section 5.4(i)(b) and Section 5.4(i)(c) herein.   
(ii)    In addition, and notwithstanding the provisions of Section 5.4(i), each Award shall also vest on the earliest to occur of the following: 
(A)    The date of a Change of Control, provided that the Participant has been continuously employed by the Company or an Affiliate from the Grant Date until the date of the Change of Control event;

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(B)    The date of the Participant’s death, provided that the Participant has been continuously employed by the Company or an Affiliate from the Grant Date until the date of death;
(C)    The date of the Participant’s Total Disability, provided that the Participant has been continuously employed by the Company or an Affiliate from the Grant Date until the date of Total Disability. 
Notwithstanding that an Award may have vested in whole or in part, an Award shall not be settled, and a Participant shall have no right to any payment with respect to an Award, unless a Participant is entitled to settlement as provided in Section 2.23 and ARTICLE 6 herein.  
Except as otherwise determined by the Administrator, any Award which is not vested upon the date of a Participant’s termination of employment with the Company shall be forfeited, and no payment shall be made thereon.  If the Participant engages in a Competitive Activity or is terminated For Cause or otherwise violates any recoupment or forfeiture provisions as described in ARTICLE 16 or as may be included in an Award Agreement, he shall forfeit the right to receive payments with respect to an Award and shall be required to return to the Company payments previously made, as provided in ARTICLE 16 or in an individual Award Agreement.  Notwithstanding the preceding provisions of Section 5.4, the Administrator shall have authority to modify and/or accelerate the vesting of Awards (but not to accelerate or modify the distribution of benefits related to Awards, unless otherwise permitted under Code Section 409A).  The determination whether to modify and/or accelerate vesting of an Award shall be made in the Administrator’s sole discretion, and, if the Administrator elects to modify and/or accelerate the vesting of an Award with respect to a Participant, neither the Participant nor any other Participant shall have any right to accelerated or modified vesting with respect to any other Award.
ARTICLE 6.    SETTLEMENT OF PHANTOM STOCK.
6.1.    Settlement Date.  Each vested Award shall become payable upon the Participant’s Settlement Date.
6.2.    Settlement of Award.  On the Settlement Date, the Participant shall be entitled to receive, for each share of Phantom Stock subject to the Participant’s Award, if and only to the extent the Award is vested as of the Settlement Date, an amount equal to the Fair Market Value of a share of Common Stock as determined on the Settlement Date, less any required withholding.  The amount of payment with respect to an Award shall be based on the Fair Market Value of a share of Common Stock on the Settlement Date, without regard to the Fair Market Value of a share of Common Stock on any other (later) date.  No payment shall be made with respect to any portion of an Award that is not vested as of the Participant’s Settlement Date, and any such unvested portion of an Award shall be forfeited at that time.  No shares of Common Stock shall be issued pursuant to the Plan or an Award Agreement and payments made under the Plan or an Award Agreement, if at all, shall be made solely in cash.  Subject to the provisions of Sections 6.3, ARTICLE 10, and ARTICLE 11, such amount shall be paid in cash to the Participant in twenty-four substantially equal monthly installments commencing on the first day of the calendar month next following the Settlement Date, unless an Award Agreement provides otherwise or the Administrator determines otherwise, in each case in a manner in accordance with Code Section 409A.  In addition, a Participant may elect to defer the annual installments payable under an Award Agreement for a period of five years by filing a written election with the Administrator at least one year in advance of the date as of which payment of the annual installments would otherwise commence (each annual installment shall be regarded as a separate 

7

payment for purposes of Code Section 409A).  No interest or earnings shall be paid on any distribution made after the Settlement Date, whether such payments are made in twenty-four monthly installments as provided herein or pursuant to payments made at the Participant’s election in accordance with the Plan and the Award Agreement.  In the event an amount becomes payable pursuant to this ARTICLE 6 on account of the Participant’s termination of employment due to death, or the Participant becomes entitled to receive an amount pursuant to this ARTICLE 6 and he dies prior to receiving any or all of the amounts to which he is due, then the amounts payable pursuant to this ARTICLE 6 shall be made to the beneficiary or beneficiaries (which may include individuals, trusts or other legal entities) designated by the Participant on the form attached hereto as Exhibit A and filed with the Plan Administrator prior to his death (the “Beneficiary Designation Form”).  If the Participant fails to designate a beneficiary or fails to file the Beneficiary Designation Form with the Plan Administrator prior to his death, such amounts shall be made to his estate.  If a named beneficiary entitled to receive payments pursuant to the Beneficiary Designation Form dies at a time when additional payments still remain to be paid, then and in any such event, such remaining payments shall be paid to the other primary beneficiary or beneficiaries named by the Participant who shall then be living or in existence, if any, otherwise to the contingent beneficiary or beneficiaries named by the Participant who shall then be living or in existence, if any; otherwise to the estate of the Participant.
6.3.    Small Payments.  Notwithstanding the provisions of Sections 6.2, in the event the amount to be paid to or on behalf of a Participant pursuant to Section 6.2 in settlement of any Award shall be less than the limit applicable under Reg. 1.409-A(3)(j)(v), such amount shall be paid to the Participant or his beneficiary, as the case may be, in a single lump sum payment as soon as practicable following the Settlement Date. 
ARTICLE 7.    DILUTION AND OTHER ADJUSTMENTS.  In the event of any change in the outstanding shares of Common Stock by reason of any stock dividend or split, recapitalization, merger, consolidation, spin-off, reorganization, combination or exchange of shares, or other similar corporate change, the Administrator shall make such adjustments in the number of shares of Phantom Stock reserved under the Plan and the number of shares of Phantom Stock with respect to which an Award held by any Participant is referenced, as are necessary to prevent dilution or enlargement of an Award.  Such adjustments shall be conclusive and binding upon all parties concerned.
ARTICLE 8.    CANCELLATION OF AWARDS.  The Administrator may cancel all or any part of an Award with the written consent of the Participant holding such Award.  In the event of any cancellation, all rights of the Participant in respect of such cancelled Award shall terminate.
ARTICLE 9.    MISCELLANEOUS PROVISIONS.
9.1.    Assignment and Transfer.  Awards shall not be transferable other than by will or the laws of intestate succession and may be realized, during the lifetime of the Participant, only by the Participant or by his or her guardian or legal representative.  No Award or interest or right therein shall be liable for the debts, contracts, or engagements of the Participant or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment, or any other means whether such disposition be voluntary or involuntary or by operation of law, by judgment, levy, attachment, garnishment, or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence.
9.2.    No Right to Awards or Employment.  No Eligible Key Employee, Participant or other person shall have any claim or right to be granted an Award.  Under no circumstances shall the terms 

8

of the Plan constitute a contract of continuing employment or in any manner obligate the Company to continue or discontinue the employment of an Eligible Key Employee or Participant, or to change the policies of the Company regarding termination of employment.  Except as otherwise provided in the Plan or an Award Agreement, all rights of a Participant with respect to an Award shall terminate upon termination of employment.  
9.3.    Source of Payments; General Creditor Status.  The obligations of the Company to make payments hereunder shall constitute a liability of the Company to the Participant.  Such payments shall be from the general funds of the Company, and the Company shall not be required to establish or maintain any special or separate fund, or otherwise to segregate assets to assure that such payments shall be made, and neither the Participant nor any other person shall have any interest in any particular asset of the Company by reason of its obligations hereunder.  Nothing contained in this Plan shall create or be construed as creating a trust of any kind or any other fiduciary relationship between the Company and the Participant or any other person.  To the extent that any person acquires a right to receive payments from the Company hereunder, such right shall be no greater than the right of an unsecured creditor of the Company.
9.4.    Withholding.  The Company shall have the right to deduct from payment of an Award any taxes required by law to be withheld from the Participant with respect to such payment.
9.5.    Compliance with Applicable Law.  The Company may impose such restrictions on Awards and any right to cash payments underlying an Award as it may deem advisable, including without limitation restrictions under an Applicable Law.  Notwithstanding any other Plan provision to the contrary, the Company shall not be obligated to make any distribution of benefits under the Plan, or take any other action, unless such distribution or action is in compliance with Applicable Law.  The Company will be under no obligation to register securities with the Securities and Exchange Commission or to effect compliance with the exemption, registration, qualification or listing requirements of any state securities laws, stock exchange or similar organization, and the Company will have no liability for any inability or failure to do so.  
9.6.    Administration and Interpretation.  The authority and discretion to administer this Plan, and to construe and interpret this Plan and any Award Agreement, shall be vested in the Administrator, and the Administrator shall have all powers as are provided in the Plan and any Award Agreement.  Any interpretation of this Plan or an Award Agreement by the Administrator and any decision made by it with respect to this Plan or an Award Agreement is final and binding. 
9.7.    No Strict Construction.  No rule of strict construction shall be applied against the Company, the Administrator, or any other person in the interpretation of any of the terms of the Plan, any Award, or any rule or procedure established by the Administrator.
9.8.    Shareholder Rights.  A Participant shall not have any dividend, voting, or other shareholder rights by reason of a grant of an Award or settlement of an Award.
9.9.    Severability.  Whenever possible, each provision in the Plan and in every Award Agreement shall be interpreted in such manner as to be effective and valid under Applicable Law, but if any provision of this Plan or any Award Agreement made thereunder shall be held to be prohibited by or invalid under Applicable Law, then (i) such provision shall be deemed amended to, and to have contained from the outset such language shall be necessary to, accomplish the objectives of the provision as originally written to the fullest extent permitted by law, and (ii) all other provisions of the Plan and every Award Agreement shall remain in full force and effect.

9

9.10.    Governing Law.  The Plan and the performance hereunder and all suits and special proceedings hereunder shall be governed by and construed in accordance with and under and pursuant to the laws of the State of North Carolina without regard to conflicts of law principles thereof, except as superseded by applicable federal law.
9.11.    Section 16(b) Compliance.  If and to the extent that any Participants in the Plan are subject to Section 16(b) of the Exchange Act, it is the general intention of the Company that transactions under the Plan shall comply with Rule 16b-3 under the Exchange Act and that the Plan shall be construed in favor of such Plan transactions meeting the requirements of Rule 16b-3 or any successor rules thereto.  Notwithstanding anything in the Plan to the contrary, the Administrator, in its sole and absolute discretion, may bifurcate the Plan so as to restrict, limit or condition the use of any provision of the Plan to Participants who are officers or directors subject to Section 16 of the Exchange Act without so restricting, limiting or conditioning the Plan with respect to other Participants. 
9.12.    Gender and Number.  Except where otherwise indicated by the context, words in any gender shall include any other gender, words in the singular shall include the plural and words in the plural shall include the singular.
ARTICLE 10.    AMENDMENT AND TERMINATION.
10.1.    Amendment and Termination.  The Plan may be amended, altered and/or terminated at any time by the Board provided, however, that approval of an amendment to the Plan by the shareholders of the Company shall be required to the extent, if any, that shareholder approval of such amendment is required by Applicable Law.  Any Award may be amended, altered and/or terminated at any time by the Administrator, provided, however, that any such amendment, alteration or termination of an Award shall not, without the consent of the Participant, materially adversely affect the rights of the Participant with respect to the Award.
10.2.    Unilateral Authority of Administrator to Modify Plan and Awards.  Notwithstanding Section 10.1, the following provisions shall apply:
(a)    The Administrator shall have unilateral authority to amend the Plan and any Award (without Participant consent) to the extent necessary to comply with Applicable Law or changes to Applicable Law (including but in no way limited to Code Section 409A or related regulations or other guidance).
(b)    The Administrator shall have unilateral authority to make adjustments to the terms and conditions of Awards in recognition of unusual or nonrecurring events affecting the Company, or the financial statements of the Company, or of changes in accounting principles, if the Administrator determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or necessary or appropriate to comply with applicable accounting principles.
ARTICLE 11.    COMPLIANCE WITH CODE SECTION 409A.  To the extent applicable, the Company intends that this Plan comply with Section 409A of the Code, and all rules, regulations and other similar guidance issued thereunder (“Code Section 409A”).  This Plan shall at all times be interpreted and construed in a manner to comply with Code Section 409A (including compliance with any applicable exemptions from Code Section 409A) and that should any provision be found not in compliance with Code Section 409A, the Company shall execute any and all amendments to this Plan deemed necessary and required by the Company’s legal counsel to achieve compliance with Code Section 409A or 

10

any applicable exemption.  In no event shall any payment required to be made pursuant to ARTICLE 6 of the Plan that is considered deferred compensation within the meaning of Code Section 409A be made to the Participant as a result of his “termination of employment” unless he has incurred a separation from service as defined under Code Section 409A,  and the term “termination of employment” (or words or phrases of similar meaning) shall be construed to mean a “separation of service” if and to the extent required under Code Section 409A. In the event amendments are required to make this Plan compliant with Code Section 409A, the Company shall use its best efforts to provide the Participant with substantially the same benefits and payments he would have been entitled to pursuant to this Plan had Code Section 409A not applied, but in a manner that is compliant with Code Section 409A or any of its exemptions.  The manner in which the immediately preceding sentence shall be implemented shall be the subject of good faith determination of the Company.  In no event shall any payment required to be made pursuant to this Plan that is considered deferred compensation within the meaning of Code Section 409A (and is not otherwise exempt from the provisions thereof) be accelerated in violation of Code Section 409A.  In the event that the Company (or a successor thereto) has any stock that is publicly traded on an established securities market or otherwise, distributions that are subject to Code Section 409A to any Participant who is a “specified employee” (as defined under Code Section 409A) upon a separation from service (as defined under Code Section 409A) may only be made following the expiration of the six-month period after the date of separation from service (with such distributions to be made during the seventh month following separation of service), or, if earlier than the end of the six-month period, the date of death of the specified employee, or as otherwise permitted under Code Section 409A.  In the event that the Plan or any Award shall be deemed not to comply with Code Section 409A, then neither the Company, the Administrator nor its or their designees or agents shall be liable to any Participant or other person for actions, decisions or determinations made in good faith.  Participants are solely responsible and liable for the satisfaction of all taxes and penalties that may arise in connection with Awards (including any taxes arising under Code Section 409A), and the Company shall not have any obligation to indemnify or otherwise hold any Participant harmless from any or all of such taxes. 
ARTICLE 12.    SUCCESSORS.  The Plan shall bind any successor of or to the Company, the Company’s assets or the Company’s businesses (whether direct or indirect, by purchase of such assets or businesses, merger, consolidation or otherwise), in the same manner and to the same extent that the Company would be obligated under the Plan if no succession had taken place.  In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by the Plan, the Company shall require such successor expressly and unconditionally to assume and agree to perform the Company’s obligations under the Plan, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.  The term “Company,” as used in the Plan, shall mean the Company as hereinbefore defined and any successor or assignee to the business or assets which by reason hereof becomes bound by the Plan.  The Plan shall bind the Participants, their executors, administrators, personal representatives and beneficiaries.
ARTICLE 13.    ERISA REQUIREMENTS.
13.1.    Named Fiduciaries.  For purposes of ERISA, the Administrator will be the Named Fiduciary and Plan Administrator with respect to the Plan.  The Plan shall be administered and the records of the Plan shall be maintained on the basis of the plan year.  The plan year shall be the twelve month period ending on December 31 of each year.
13.2.    Claims and Review Procedures.  The following claims procedure shall apply for purposes of the Plan.  The Participant and his assigns (if any) and the Company and its assigns (individually or collectively, “Claimant”) must follow the procedures set forth herein.

11

13.2.1  Filing a Claim; Notification to Claimant of Decision: The Claimant shall make a claim in writing in accordance with procedures and guidelines established from time to time by the Plan Administrator, which claim shall be delivered to the Plan Administrator.  Any claims relating to the settlement of an Award must be made by the Claimant within the one-year period following his termination of employment.  The Plan Administrator shall review and make the decision with respect to any claim.  If a claim is denied in whole or in part, written notice thereof shall be furnished to the Claimant within thirty (30) days after the claim has been filed.  Such notice shall set forth:
(i)    The specific reason or reasons for the denial;
(ii)    A specific reference to the provisions of the Plan on which denial is based;
(iii)    A description of any additional material or information necessary for the Claimant to perfect a claim and an explanation of why such material or information is necessary; and
(iv)    An explanation of the procedure for review of the denied claim.
13.2.2  Procedure for Review: Any Claimant whose claim has been denied in full or in part may individually, or through the Claimant’s duly authorized representative, request a review of the claim denial by delivering a written application for review to the Board at any time within sixty (60) days after receipt by the Claimant of written notice of the denial of the claim.  Such request shall set forth in reasonable detail:
(i)    The grounds upon which the request for review is based and any facts in support thereof; and
(ii)    Any issues or comments which the Claimant considers pertinent to the claim.
Following such request for review, the Board shall fully and fairly review the decision denying the claim.  Prior to the decision of the Board, the Claimant shall be given an opportunity to review pertinent documents.
13.2.3  Decision on Review: A decision on the review of a claim denied in whole or in part shall be made in the following manner:
(i)    The decision on review shall be made by the Board, which shall consider the application and any written materials submitted by the Claimant in connection therewith.  The Board, in its sole discretion, may require the Claimant to submit such additional documents or evidence as the Board may deem necessary or advisable in making such review.
(ii)    The Board shall render a decision upon a review of a denied claim within sixty (60) days after receipt of a request for review.  If special circumstances (such as the need to hold a hearing on any matter pertaining to the denied claim) warrant additional time, the decision will be rendered as soon as possible, but not later than one hundred twenty (120) days after receipt of a request for review.  Written notice of any such extension will be furnished to the Claimant prior to the commencement of the extension.

12

(iii)    The decision on review shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the Claimant, and the specific references to the provisions of the Plan on which the decision is based.  The decision of the Board on review shall be final and conclusive upon all persons.  If the decision on review is not furnished to the Claimant within the time limits prescribed in subparagraph (ii) above, the claim will be deemed denied on review.
ARTICLE 14.    RIGHT OF OFFSET.  Notwithstanding any other provision of the Plan to the contrary, the Company may (subject the any Code Section 409A considerations) at any time reduce the amount of any payment otherwise payable to or on behalf of a Participant by the amount of any obligation of the Participant to or on behalf of the Company that is or becomes due and payable, and, by entering into an Award Agreement, the Participant shall be deemed to have consented to such reduction.
ARTICLE 15.    EFFECTIVE DATE OF THE PLAN.  The Plan is effective as of October 30, 2012 (the “Effective Date”) and shall continue in effect until the termination of the Plan by the Board in accordance with ARTICLE 10.  Awards outstanding as of the Plan termination date shall continue in accordance with their terms, unless otherwise provided in the Plan or an Award Agreement.
ARTICLE 16.    COMPLIANCE WITH RECOUPMENT, OWNERSHIP AND OTHER POLICIES OR AGREEMENTS:  
16.1.    General.  Notwithstanding anything in the Plan or an Award Agreement to the contrary, the Administrator may, at any time, consistent with, but without limiting, the authority granted in ARTICLE 3 herein, in its discretion provide that an Award or benefits related to an Award shall be forfeited and/or recouped (that is, returned to) the Company if the Participant, during employment or service or following termination of employment or service for any reason, engages in certain specified conduct, including but not limited to breach of non-solicitation, noncompetition, confidentiality or other restrictive covenants, at any time For Cause, or other conduct by the Participant that is determined by the Administrator to be detrimental to the business or reputation of the Company or any Affiliate.  In addition, without limiting the effect of the foregoing, as a condition to the grant of an Award or receipt or retention of cash or any other benefit under the Plan, the Administrator may, at any time, require that a Participant agree to abide by any compensation recovery policy and/or other policies adopted by the Company or an Affiliate, each as in effect from time to time and to the extent applicable to the Participant.  Further, each Participant shall be subject to such compensation recovery, recoupment, forfeiture or other similar provisions as may apply under Applicable Law.
16.2.    Engagement in Competitive Activity.  Without in any way limiting the Administrator’s authority under Section 16.1 or any other provision in the Plan or in any Award Agreement, in the event the Administrator, in its sole and absolute discretion, determines that the Participant has engaged in a Competitive Activity at any time during employment by the Company or an Affiliate or during the two-year period following termination of employment, (i) any payments to which the Participant is otherwise entitled shall immediately cease and the Participant shall have no right to receive any further payments under the Plan or any Award; and (ii) the Participant shall immediately return to the Company, and the Company shall without any further action have the right to recover, any amounts that have been paid to the Participant pursuant to an Award in the two-year period following termination of employment.

13

IN WITNESS WHEREOF, this Old Dominion Freight Line, Inc. 2012 Phantom Stock Plan is executed in behalf of the Company as of the 30th day of October, 2012.
	
		
	

Attest:

   /s/ Ross H. Parr                     .
Secretary/Asst.  Secretary

[Corporate Seal]
	OLD DOMINION FREIGHT LINE, INC.

By:      /s/ David S. Congdon                                       .
David S. Congdon, President and Chief    Executive Officer

	 
	 

14

EXHIBIT A
OLD DOMINION FREIGHT LINE, INC.
2012 PHANTOM STOCK PLAN
BENEFICIARY DESIGNATION
Subject to and in accordance with the provisions of ARTICLE 6 of the OLD DOMINION FREIGHT LINE, INC. 2012 PHANTOM STOCK PLAN (the “Plan”), the Participant hereby designates the following beneficiary(ies) entitled, upon the death of the Participant, to any amounts payable under ARTICLE 6 of the Plan following his death (the “death benefit”):
		
	(A)
	Primary Beneficiary(ies): In equal shares to those of the following beneficiary(ies) who are living or in existence at the Participant’s death:

	
			
	Name
	Relationship
	Address

		
	(B)
	Contingent Beneficiary(ies): If there is no primary beneficiary living or in existence at the Participant’s death, then in equal shares to those of the following beneficiary(ies) who are living or in existence at the Participant’s death:

	
			
	Name
	Relationship
	Address

****************************************************
This Beneficiary Designation Form supersedes and revokes all beneficiary designations, if any, previously made by the Participant but is not intended to, and does not, supercede or revoke any of the provisions of ARTICLE 6 of the Plan.
This Beneficiary Designation Form may be changed by executing and delivering a new designation to the Plan Administrator.
This Beneficiary Designation Form is signed in duplicate, and one executed copy shall be retained by the Plan Administrator and one shall be retained by the Participant.
	
			
	DATED:
                  
	 
	

                  

	DATED:
                  
	 
	PLAN ADMINISTRATOR 
By:

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