Document:

Exhibit 4.2 -- Option Agreement

 Exhibit 4.2 
  

HADRON, INC.  
 NON-QUALIFIED STOCK OPTION AGREEMENT 
  
 This
Non-Qualified Stock Option Agreement (the “Agreement”), effective as of January 16, 2001 (the “Date of Grant”), is made by and between Hadron, Inc., a New York corporation (the “Company”), and Sterling E. Phillips, Jr.
(“Recipient”). 
  
 Background 
  
 WHEREAS, the Company and Recipient have entered into an Employment Agreement
dated as of January 16, 2001 (“Employment Agreement”) whereby Company has agreed to grant Recipient options to purchase restricted shares of the common stock bearing a standard Rule 144 Legend, par value $.02 per share (“Common
Stock”) in the Company; 
  
 THEREFORE, in consideration of
the mutual covenants contained in this Agreement and other good and valuable consideration, the Company and the Recipient agree as follows: 
  

	1.	Grant of Option. In consideration of service to the Company and for other good and valuable consideration, the Company grants to the Recipient an option to purchase
875,725 restricted shares of the Company’s Common Stock bearing a standard Rule 144 Legend in accordance with the terms and conditions of the Employment Agreement and this Agreement (the “Option”). 

  

	2.	Option Price. The purchase price of the shares of stock covered by the Option shall be $1.375 per share. 

  

	3.	Adjustments. If a stock dividend, stock split, share combination, exchange of shares, recapitalization, consolidation, spin-off, reorganization, or liquidation of or
by the Company shall occur, the Board of Directors of the Company (the “Board”) may adjust the number and class of shares then subject to the Option and the price per share payable upon exercise of the Option to the extent the Board deems
appropriate to reflect the applicable transaction. 

  

	4.	Manner of Exercise. The Option, or any portion of the Option, may be exercised only in accordance with the terms of this Agreement and solely by delivery to the
Secretary of the Company (the “Secretary”) of all of the following items prior to the time when the Option or such portion becomes unexercisable under the terms of the Employment Agreement: 

  

	 	(a)	Notice in writing signed by the Recipient or the other person then entitled to exercise the Option or portion of the Option, stating the intention to exercise the Option or portion
of the Option, such notice complying with all applicable rules (if any) established by the Board or the Compensation Committee thereof (the “Committee”); 

  

	 	(b)	Full payment (in cash or by cashiers’ or certified check) for the shares with respect to which the Option or portion thereof is exercised; 

  

	 	(c)	Full payment (in cash or by certified check) upon demand of an amount sufficient to satisfy any federal (including FICA and FUTA amounts), state, and/or local withholding tax
requirements at the time the Recipient or his beneficiary recognizes income for federal, state, and/or local tax purposes as the result of the receipt of shares pursuant to the exercise of the Option or portion of the Option; and

  

	 	(d)	A bona fide written representation and agreement, in a form satisfactory to the Board, signed by the Recipient or other person then entitled to exercise the Option or portion of the
Option, acknowledging that the shares are being acquired for his own account, for investment and without any present intention of distributing or reselling said shares or any of them except as may be permitted under the Securities Act of 1933, as
amended (the “Act”), and that the Recipient or other person then entitled to exercise the Option or portion of the Option will indemnify the Company against and hold it free and harmless from any loss, damage, expense or liability
resulting to the Company if any sale or distribution of the shares by such person is contrary to the representation and agreement referred to above. The Board may, in its absolute discretion, take whatever additional actions it deems appropriate to
ensure the observance and performance of such representations and agreement and to effect compliance with all federal and state securities laws or regulations. The Board may require an opinion of counsel acceptable to the Board to the effect that
any subsequent transfer of shares acquired on an Option exercise does not violate the Act and may issue stop-transfer orders covering such shares. The written representations and agreement referred to in the first sentence of this subsection (e),
however, shall not be required if the shares to be issued pursuant to such exercise have been registered under the Act, and such registration is then effective in respect of such shares. 

  

	5.	Conditions to Issuance of Stock Certificates. The shares of stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously
authorized but unissued shares or issued shares which have been reacquired by the Company. Such shares shall be fully paid and nonassessable. 

  

	6.	Rights of Shareholders. The Recipient shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon
the exercise of any part of the Option unless and until certificates representing such shares shall have been issued by the Company to the Recipient. 

  

	7.	Vesting and Exercisability. A Recipient’s interest in the Option shall vest according to the provisions of this Section 7 and shall be exercisable as to not more than
the vested percentage of the shares subject to the Option at any point in time. To the extent the Option is either unexercisable or unexercised, the unexercised portion shall accumulate until the Option both becomes exercisable and is exercised,
subject to the provisions of Section 8 of the Agreement. The Option shall vest according to the following schedule: 

  

				
	Percent Vested

	 	 	Years From Date of Grant

	33 1/3	%	 	0
	66 2/3	%	 	1
	100	%	 	2

  

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 The Board, in its sole and absolute discretion, may accelerate the vesting of the Option at any time.

  

	8.	Forfeitures of Vested Options. In the event the Recipient shall materially violate the restrictive covenant provisions of the Recipient’s employment agreement or
the agreement setting forth the terms and conditions of Recipient’s employment (such material violation being a “Material Violation”), then, to the extent all, or any portion, of the Recipient’s Options have become vested
pursuant to Section 7 above (“Vested”) but have not been exercised, then all such Vested but unexercised Options shall be forfeited and shall be terminated and cancelled. Furthermore, in the event of such Material Violation, all non-Vested
Options shall be terminated and cancelled. The determination of whether there has been a Material Violation shall be made by the Company, in its sole but reasonable discretion. 

  

	9.	Divestiture of Shares. In the event of a Material Violation after the exercise of any or all of the Recipient’s Options, then this Section shall apply. If a Material
Violation occurs and the Recipient then owns all or any portion of the Shares obtained through the exercise of the Option, then the Company shall have the right, but not the obligation, to repurchase such Shares from the Recipient for an amount per
Share equal to the Exercise Price plus any related income taxes and FICA paid or payable by the Recipient as a result of the exercise of the Option with respect to those repurchased Shares. 

  
 If a Material Violation occurs and the Recipient has sold or otherwise
transferred all or any portion of the Shares obtained through the exercise of the Option, then the Recipient shall pay to the Company any “gain realized” on such sale or other transfers of the Shares. For purposes of this paragraph, the
“gain realized” shall equal the “net sales price” (I.e., net of reasonable commissions and transaction costs of the sale) of the Shares sold or transferred, minus the Exercise Price for such Shares, and minus any income and/or
capital gains taxes and FICA paid or payable by the Recipient that are a direct result of the exercise of the Option (with respect to such sold or transferred Shares) and/or the direct result of the sale or other transfer of the Shares. In the event
the sale or other transfer was to a related party at less than fair market value (e.g., a gift or bargain sale), the “net sales price” shall be deemed to equal the fair market value of the Shares at the time of such sale or other transfer.
Such fair market value shall be determined by the Company, in its sole but reasonable discretion. 
  

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	10.	Duration of Option. Except as specified below, the Option shall expire on the fifth (5th) anniversary of the Date of Grant. Notwithstanding the foregoing, the Option may expire prior to the fifth anniversary of the Date of Grant, in the following
circumstances: 

  

	 	(a)	If the Recipient dies, the Option shall expire on the one-year anniversary of the date of the Recipient’s death. During the one-year period following the
Recipient’s death, the Option may be exercised by the beneficiary or the estate of the Recipient to the extent it could have been exercised at the time the Recipient died, subject to any adjustment under Section 3 hereof.

  

	 	(b)	If the Recipient terminates employment with the Company because of his Disability, the Option shall expire on the one-year anniversary of the Recipient’s last day of
employment with the Company. During the one-year period following the Recipient’s termination of employment by reason of Disability, the Option may be exercised as to the number of Shares for which it could have been exercised at the time the
Recipient became disabled, subject to any adjustments under Section 3 hereof. 

  

	 	(c)	If the Recipient terminates employment with the Company by reason of normal retirement under the Company’s retirement policies, the Option shall expire ninety days after
the Recipient’s last day of employment with the Company. During the ninety day period following the Recipient’s normal retirement, the Option may be exercised as to the number of Shares for which the Option would have been exercisable on
the retirement date, subject to any adjustment under Section 3 hereof. 

  

	 	(d)	If the Recipient’s employment with the Company terminates for any reason other than death, Disability or retirement, the Option shall expire at 5:00 p.m. on the last day
of the Recipient’s employment with the Company, unless the Board sets a later expiration date prior to the Recipient’s last day of employment. The Board may not delay the expiration of the Option more than 90 days after termination of the
Recipient’s employment. During any delay of the expiration date, the Option shall be exercisable only to the extent it is exercisable on the date the Recipient’s employment terminates. 

  

	 	(e)	Notwithstanding any provisions set forth above in this Section 10 and as determined solely by the Company, if the Recipient shall (i) commit any act of malfeasance or
wrongdoing affecting the Company or its affiliates, (ii) breach any covenant not to compete or the Employment Agreement with the Company or any affiliate, or (iii) engage in conduct that would warrant the Recipient’s discharge for cause, any
unexercised part of the Option shall expire immediately upon the earlier of the occurrence of such event or the last day the Recipient is employed by the Company. 

  

	11.	 Administration. The Board shall have the power to interpret this Agreement and to adopt such rules for the administration, interpretation and application of
the Agreement as are consistent herewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Board in good faith shall be final and binding upon the Recipient, the Company and all other
interested persons. No member of the Board shall be personally liable for any action, determination or interpretation made 

  

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in good faith with respect to this Agreement or any similar agreement to which the Company is a party. 

  

	12.	Options Not Transferable. Neither the Option nor any interest or right therein or part thereof shall be subject to disposition by transfer, alienation, anticipation,
pledge, encumbrance, assignment or any other means whether such disposition is 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; provided, however, that this Section 11 shall not prevent transfers by will or by the applicable laws of descent and distribution. 

  

	13.	Change of Control. If a Change of Control occurs, prior to the expiration of the Option, as defined in Section 13 herein, the Board may, in its discretion, take one or
more of the following actions: (i) provide for the acceleration of any time period relating to the exercise of the Option, (ii) provide for payment to the Recipient of cash or other property with a fair market value equal to the amount that would
have been received upon the exercise of the Option had the Option been exercised or paid upon the Change of Control, (iii) adjust the terms of the Option in a manner determined by the Board to reflect the Change of Control, (iv) cause the Option to
be assumed, or new rights substituted therefor, by another entity, (v) make such other provision as the Board may consider equitable to the Recipient and in the best interests of the Company, or (vi) designate a date when the Option, if not
exercised, shall terminate; provided however, that such a date shall not be so designated unless the Board provides at least 30 days advance written notice of the date of termination to the Recipient. In such any event, all other provisions, terms
and conditions of this Agreement and the Employment Agreement shall remain in full force and effect and the Board is expressly authorized to take the action described in the preceding sentence and to amend this Agreement or the Employment Agreement
or take such other actions as may be necessary, appropriate or incidental to the actions described above. 

  
 “Change of Control” shall mean (a) an agreement by the Company to sell all or substantially all of its assets, merge, dissolve, liquidate or
reorganize; (b) an agreement by the holders of a majority of the common stockholders of the Company to sell a majority of the outstanding Common Stock of the Company to a third party; or (c) the occurrence of any other change in control event, as
defined by the Board. 
  

	14.	Shares to be Reserved. The Company shall at all times during the term of the Option reserve and keep available such number of shares of stock as will be sufficient to
satisfy the requirements of this Agreement. 

  

	15.	 Notices. Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary and any notice to
be given to the Recipient shall be addressed to him at the address given beneath his signature below. By a notice given pursuant to this Section 15, either party may hereafter designate a different address for notices to be given to him. Any notice
which is required to be given to the Recipient shall, if the Recipient is then deceased, be given to the Recipient’s personal representative if such representative has previously informed the Company of his status 

  

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and address by written notice under this Section 15. Any notice shall have been deemed duly given when enclosed in a properly sealed envelope addressed as
aforesaid, deposited (with postage prepaid) in a United States postal receptacle. 

  

	16.	Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 

  

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 The Company and the Recipient have executed this Agreement effective as of the date first written above. 
  

			
	HADRON, INC.
		
	By:	 	 /s/ Jon M. Stout

	 	 	 Jon M. Stout
 Chairman

  

			
	RECIPIENT
	
	 /s/ Sterling Phillips

	 Sterling Phillips

  

 7Performance-based Stock Unit Award Agreement

 Exhibit 10(a) 
  
 ABX AIR, INC. 
 2005 LONG-TERM-INCENTIVE PLAN 
  
 PERFORMANCE-BASED STOCK UNITS 
 INSTRUCTIONS FOR COMPLETING AWARD AGREEMENT 
  

	1.00 	Type of Award 

  
 This Award Agreement is to be used only to grant Performance-based stock units to employees. 
  

	2.00 	Instructions for Completing This Form 

  
 To complete this form: 
  

	 	•	 	Select the “edit” option from your P.C.’s horizontal menu bar. 

  

	 	•	 	Select “Replace” from the drop-down dialogue box. 

  

	 	•	 	Using the “Replace” dialogue box: 

  

	 	•	 	In the “Find what” box, type the code of the item to be replaced from the code sheet accompanying this form (using all capital letters or initial capital letters as
indicated on the code sheet); 

  

	 	•	 	In the “Replace with” box, type the information to be substituted for the coded item (using all capital letters or initial capital letters as indicated on the code sheet);

  

	 	•	 	Click “match case”; and 

  

	 	•	 	Click on the “Replace all” box. 

  

	 	•	 	Repeat this procedure for each code to be replaced. 

  

 ABX AIR, INC. 
 2005 LONG-TERM INCENTIVE PLAN 
  
 PERFORMANCE-BASED STOCK UNIT AWARD AGREEMENT 
  
 Code Sheet 
  
 The
following codes are used in this Award Agreement and should be replaced using your P.C.’s “Replace” function (see instructions accompanying this form). 
  

			
	 VTA
	  	Grantee’s name (all capital letters)
		
	 VTB
	  	Grant Date (all capital letters)
		
	 Vtb
	  	Grant Date (initial capital letters only)
		
	 Vte
	  	Date that is 30 days after Grant Date (initial capital letters only)
		
	 Vtq
	  	Grantee’s name (initial capital letters only)

  

 THIS FORM OF AWARD AGREEMENT IS PART OF A PROSPECTUS COVERING 
 SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 
  
 ABX AIR, INC. 
  

2005 LONG-TERM INCENTIVE PLAN 
  
 PERFORMANCE-BASED STOCK UNIT 
  
 GRANTED TO VTA ON VTB 
  
 ABX Air, Inc. (“Company”) and its shareholders believe that their business interests are best served by extending to you an opportunity to earn additional
compensation based on the growth of the Company’s business. To this end, the Company and its shareholders adopted the ABX Air, Inc. 2005 Long-Term Incentive Plan (“Plan”) as a means through which you may share in the Company’s
success. This is done by granting Awards to key employees like you. If you satisfy the conditions described in this Agreement (and the Plan), your Award will mature into common shares of the Company. 
  
 This Award Agreement describes many features of your Award and the conditions you must meet
before you may receive the value associated with your Award. To ensure you fully understand these terms and conditions, you should: 
  

	 	•	 	Read the Plan and the Plan’s Prospectus carefully to ensure you understand how the Plan works; 

  

	 	•	 	Read this Award Agreement carefully to ensure you understand the nature of your Award and what must happen if you are to earn it; and 

  

	 	•	 	Contact W. Joseph Payne at (937) 382-5591 ext. 2686 if you have any questions about your Award. 

  
 Also, no later than Vte, you must return a signed copy of the Award Agreement to: 
  
 W. Joseph Payne 
 ABX Air, Inc. 
 145 Hunter Drive 

Wilmington, Ohio 45177 
  
 If you do not do this, your Award will be revoked automatically as of the date it was granted and you will not be entitled to receive anything on account of the
retroactively revoked Award. 
  
 Section 409A of the Internal Revenue Code
(“Section 409A”) imposes substantial penalties on persons who receive some forms of deferred compensation (see the Plan’s Prospectus for more information about these penalties). Your Award has been designed to avoid these penalties.
However, because the Internal Revenue Service has not yet issued rules fully defining the effect of Section 409A, it may be necessary to revise your Award Agreement if you are to avoid these penalties. As a condition of accepting this Award, you
must agree to accept those revisions, without any further consideration, even if those revisions change the terms of your Award and reduce its value or potential value. 
  

 1 

 Nature of Your Award 
  
 You have been granted an Award consisting of stock units, which will be converted to common shares of the Company if the conditions
described in this Award Agreement are met. Federal income tax rules apply to the payment of your Award. These and other conditions affecting your Award are described in this Award Agreement, the Plan and the Plan’s Prospectus, all of which you
should read carefully. 
  
 No later than Vte, you must return a signed copy of
this Award Agreement to: 
  
 W. Joseph Payne 
 ABX Air, Inc. 
 145 Hunter Drive 

Wilmington, Ohio 45177 
  
 If you do not do this, your Award will be revoked automatically as of the Grant Date and you will not be entitled to receive anything on account of the retroactively
revoked Award. 
  
 Grant Date: Your Performance Units were issued on Vtb.

  
 This is the date you begin to earn your Award. 
  
 Amount of Award: The amount of your Award and the conditions that must be met before
it will be earned is discussed below in the section below titled “When Your Award Will Be Settled.” 
  
 Performance Period: The period that begins on the Grant Date (i.e., Vtb) and ends on December 31, 2007. 
  
 This is the period over which the Plan committee will determine if you have met the
conditions imposed on your Award. 
  
 When Your Award Will
Be Settled 
  
 Settlement: At the end of the Performance Period, your
stock units will be converted to an equal number of common shares of the Company or forfeited depending on: 
  

	 	•	 	The extent to which the appreciation of the Company stock during the Performance Period equals or exceeds the performance of the NASDAQ Transportation Index during the same period
(these stock units are referred to as “Stock Performance Units”); and 

  

	 	•	 	How the Company’s Average Return on Equity for each fiscal year that ends with or within the Performance Period compares to the levels specified in the table below (these stock
units are referred to as “ROE Units”). 

  
 The tables below demonstrate how these criteria will affect your Award. However, before analyzing those tables, it is important that you understand that: 
  

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	 	•	 	Separate criteria are applied to each of the parts of your Award. This means that you might earn Stock Performance Units at the threshold level but earn your ROE Units at the
maximum level. 

  

	 	•	 	The NASDAQ Transportation Index is an index comprised of transportation corporations whose stock is traded on the NASDAQ. 

  

	 	•	 	Average Return on Equity is calculated by dividing the Company’s net income (i.e., income after taxes and expenses) by shareholder equity. This calculation is made as of
January 1 and December 31 of each of the Company’s fiscal years that end with or within the Performance Period (except that such calculation shall be made on April 1 and December 31 for the fiscal year ending on December 31, 2005) and averaged
over the same number of fiscal years. 

  
 Your
Stock Performance Units 
  
 You will earn or forfeit all or part of your Stock
Performance Units depending on the extent to which the criteria described in the following table are met. 
  

			
	 If, on December 31, 2007, the Company’s stock performance is . . .

	  	 You will receive the following number of shares of Company stock . . .

	In at least the 25th percentile of the NASDAQ Transportation Index (“threshold Stock Performance Unit level”) . . .	  	 
		
	In the 25th through 50th percentile of the NASDAQ Transportation Index (“target Stock Performance Unit level”) . . .	  	 
		
	In the 50th or higher percentile of the NASDAQ Transportation Index (“maximum Stock Performance Unit Level”) . . .	  	 

  
 Your ROE Units

  
 You will earn or forfeit all or part of your ROE Units depending on the
extent to which the criteria described in the following table are met. 
  

			
	 If, over the Performance Period the Company’s Average Return on Equity is .
. .

	  	 You will receive the following number of shares of Company stock . . .

	At least 15% but less than 20% (“threshold ROE Unit level”) . . .	  	 
		
	More than 20% but less than 25% (“target ROE Unit level”) . . .	  	 
		
	Equal to or greater than 25% (“maximum ROE Unit level”) . . .	  	 

  

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 Also, the committee will calculate the number of shares you receive by interpolating whole percentages between the ranges
shown in the preceding two tables. However, this will be done only in whole percentages and will not be applied below the threshold level or above the maximum level. 
  
 Example 1: assume that the Company’s Average Return on Equity for the Performance Period is 21 percent (one full
percentage point above the lowest range of the “target ROE Unit level”). In this case, you will receive              shares of Company stock (because whole percentages
between the threshold and maximum levels are interpolated). 
  
 Example 2: assume that the Company’s Average Return on Equity for the Performance Period is 26 percent (one full percentage point above the “maximum ROE Unit level”). In this case, you still will receive
             shares of Company stock (because no interpolation is applied above the maximum level). 
  
 Example 3: assume that the Company’s Average Return on Equity for the Performance Period is 14 percent (one full
percentage point below the lowest range of the “threshold ROE Unit level”). In this case, all of the ROE Units will be forfeited (because no interpolation is applied below the threshold level). 
  
 Example 4: assume that the Company’s Average Return on Equity
for the Performance Period is 20.7 percent (seven-tenths of a percentage point above the lowest range of the “target ROE Unit level”). In this case, you still will receive
             shares of Company stock (because only whole percentages are interpolated). 
  
 How Your Performance Units Might Be Settled Before the End of the Performance Period: If there is a Business Combination (as defined in the Plan) while you are
employed, all performance criteria will be deemed to have been met at the threshold level or at any higher level actually achieved as of the date of the Business Combination (“Accelerated Units”) and you will receive cash or stock
(depending on the nature of the Business Combination) as if the Performance Period ended on the date of the Business Combination. The amount you will receive will be determined under the following formula: 
  
 Your Accelerated Units multiplied by the number of whole months between
the beginning of the Performance Period and the date of the Business Combination 

 Divided by the number of whole months in the Performance Period 
  
 How Your Performance Units Are Settled if You Die, Retire or Become Disabled Before the End of the Performance Period: If your employment terminates before the end of the Performance Period (and before a Business Combination) because
of death, disability (as defined in the Plan) or after qualifying for retirement under the ABX Air, Inc. Retirement Income Plan, you may receive a portion of your Award. The amount (if any) you will receive will depend on whether (and the extent to
which) the performance criteria are met at the end of the Performance Period, not when you terminate employment. If the performance criteria are met at the end of the Performance Period during which you terminate because of death, disability
or retirement, you 

  

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(or your beneficiary) will receive the number of shares you would have received if you had remained actively employed until the end of that Performance
Period multiplied by the number of whole years (i.e., elapsed 12-consecutive-month periods) between the first day of the Performance Period and the date you terminate employment because of death, retirement or disability and divided by
the number of whole years (i.e., elapsed 12-consecutive-month periods included in the Performance Period). 
  
 How Your Performance Units May Be Forfeited: You will forfeit your Performance Units if, before your Performance Units are settled: 
  

	 	•	 	You terminate employment voluntarily (and before you are eligible for retirement) or if you are involuntarily terminated by the Company for any reason (or for no reason) before the
Normal Settlement Date (and you are not then eligible for retirement); 

  

	 	•	 	You commit any act of fraud, intentional misrepresentation, embezzlement, misappropriation or conversion of any of the Company’s or any Subsidiary’s (as defined in the
Plan) assets or business opportunities; 

  

	 	•	 	You are convicted of, or enter into a plea of nolo contendere to, a felony; 

  

	 	•	 	You intentionally, repeatedly or continually violate any of the Company’s policies or procedures after notice that you have violated a Company policy or procedure;

  

	 	•	 	You breach any written covenant or agreement with the Company or any Subsidiary, including the terms of the Plan; 

  

	 	•	 	Without the Company’s advance written consent, you agree to or actually serve in any capacity for a business or entity that competes with any portion of the Company’s or
any Subsidiary’s (as defined in the Plan) business or provide services (including business consulting) to an entity that competes with any portion of the Company’s or any Subsidiary’s business; 

  

	 	•	 	You refuse or fail to consult with, supply information to or otherwise cooperate with the Company after having been requested to do so; or 

  

	 	•	 	You deliberately engage in any action that the Company decides harms the Company or any Subsidiary. 

  
 Settling Your Award 
  
 If all applicable conditions have been met, your Performance Units will be settled
automatically. 
  
 Other Rules Affecting Your Award

  
 Rights During the Performance Period: During the Performance
Period, you will not actually own the shares that you might receive at the end of the Performance Period. This means that you may not exercise any voting rights or receive any dividends associated with those shares until your Award is settled.

  

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 Beneficiary Designation: You may name a Beneficiary or Beneficiaries to receive any shares associated with your
Performance Units that are settled after you die. This may be done only on the attached Beneficiary Designation Form and by following the rules described in that form and in the Plan. If you have not made an effective Beneficiary designation, your
Beneficiary will be your surviving spouse or, if you do not have a surviving spouse, your estate. 
  
 Tax Withholding: Income taxes must be withheld when your Award is settled (see the Plan’s Prospectus for a discussion of the tax treatment of your Award). These taxes may be paid in one of several ways.
They are: 
  

	 	•	 	The Company may withhold this amount from other amounts owed to you (e.g., from your salary). 

  

	 	•	 	You may pay these taxes by giving the Company a check (payable to “ABX Air, Inc.”) in an amount equal to the taxes that must be withheld. 

  

	 	•	 	By having the Company withhold a portion of the shares that otherwise would be distributed. The number of shares withheld will have a fair market value equal to the taxes that must
be withheld. 

  

	 	•	 	You may give the Company other shares of Company stock (that you have owned for at least six months) with a value equal to the taxes that must be withheld. 

 
 You may choose the approach you prefer, although the Company may reject your preferred
method for any reason (or for no reason). If this happens, the Company will specify (from among the alternatives just listed) how these taxes are to be paid. 
  
 If you do not choose a method within 30 days of the Settlement Date, the Company will withhold a portion of the shares that otherwise would be distributed. The number of
shares withheld will have a fair market value equal to the taxes that must be withheld and the balance of the shares will be distributed to you. 
  
 Transferring Your Performance Units: Normally your Performance Units may not be transferred to another person. However, you may complete a Beneficiary Designation
Form to name the person to receive any stock that is distributed after you die. Also, the Committee may allow you to place your Performance Units into a trust established for your benefit or the benefit of your family. Contact W. Joseph Payne at
(937) 382-5591 ext. 2686 or at the address given below if you are interested in doing this. 
  
 Governing Law: This Award Agreement will be construed in accordance with and governed by the laws (other than laws governing conflicts of laws) of the United States and of the State of Ohio, except to the
extent that the Delaware General Corporation Law is mandatorily applicable. 
  
 Other Agreements: Also, your Performance Units will be subject to the terms of any other written agreements between you and the Company. 
  

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 Adjustments to Your Performance Units: Your Award will be adjusted, if appropriate, to reflect any change to the
Company’s capital structure (e.g., the number of your Performance Units will be adjusted to reflect a stock split). 
  
 Other Rules: Your Stock Performance Units are also subject to more rules described in the Plan and in the Plan’s Prospectus. You should read both these
documents carefully to ensure you fully understand all the conditions of this Award. 
  
 Tax Treatment of Your Award 
  
 The federal
income tax treatment of your Performance Units is discussed in the Plan’s Prospectus. 
  
 ***** 
  
 You may contact W. Joseph Payne at (937)
382-5591 ext. 2686 or at the address given below if you have any questions about your Award or this Award Agreement. 
  
 ***** 
  
 Your Acknowledgment of Award Conditions 
  
 Note: You must
sign and return a copy of this Award Agreement to W. Joseph Payne at the address given below no later than Vte. 
  
 By signing below, I acknowledge and agree that: 
  

	 	•	 	A copy of the Plan has been made available to me; 

  

	 	•	 	I have received a copy of the Plan’s Prospectus; 

  

	 	•	 	I understand and accept the conditions placed on my Award and understand what I must do to earn my Award; 

  

	 	•	 	I will consent (on my own behalf and in behalf of my beneficiaries and without any further consideration) to any change to my Award or this Award Agreement to avoid paying penalties
under Section 409A of the Internal Revenue Code, even if those changes affect the terms of my Award and reduce its value or potential value; and 

  

	 	•	 	If I do not return a signed copy of this Award Agreement to the address shown below not later than Vte, my Award will be revoked automatically as of the date it was granted and I
will not be entitled to receive anything on account of the retroactively revoked Award. 

  

	
	Vtq
	
	  
	 (signature)

	 Date
signed:                                

  

 7 

 A signed copy of this form must be sent to the following address no later than Vte: 
  
 W. Joseph Payne 
 ABX Air, Inc. 
 145 Hunter Drive 

Wilmington, Ohio 45177 
  
 After it is received, the ABX Air, Inc. 2005 Long-Term Incentive Plan Committee will acknowledge receipt of your signed agreement. 
  
 ***** 
  
 Committee’s Acknowledgment of Receipt 
  
 A signed copy of this Award Agreement was received on
                        . 
  

			
		
	By:	 	 
	 Vtq:
	 	 

  
              Has complied with the conditions imposed on the grant and the Award and the Award Agreement remains in effect; or 
  
              Has not complied with the conditions imposed on the grant and the Award and the Award Agreement are revoked as of the Grant Date because 
 __________________________________________________________________________________ 
 describe deficiency 
  
 ABX Air, Inc. 2005 Long-Term Incentive Plan Committee 
  

			
	 
		
	By:	 	 
		
	Date:	 	 

  
 Note: Send a copy of
this completed form to Vtq and keep a copy as part of the Plan’s permanent records. 
  

 8 

 ABX AIR, INC. 
 2005 LONG-TERM INCENTIVE PLAN 
 BENEFICIARY DESIGNATION FORM 
  
 RELATING TO PERFORMANCE STOCK UNITS ISSUED TO VTA ON VTB 
  
 Instructions for Completing This Form 
  
 You may use this form to [1] name the person you want to receive any amount due under
the ABX Air, Inc. 2005 Long-Term Incentive Plan after your death or [2] change the person who will receive these benefits. 
  
 There are several things you should know before you complete this form. 
  
 First, if you do not elect another Beneficiary, any amount due to you under the Plan when you die will be paid to your surviving spouse or, if you have no
surviving spouse, to your estate. 
  
 Second, your election will not be
effective (and will not be implemented) unless you complete all applicable portions of this form. 
  
 Third, your election will be effective only if this form is completed properly and returned to W. Joseph Payne at the address given below. 
  
 Fourth, all elections will remain in effect until they are changed (or until all death benefits are paid). 
  
 Fifth, if you designate your spouse as your Beneficiary but are subsequently divorced
from that person (or your marriage is annulled), your Beneficiary designation will be revoked automatically. 
  
 Sixth, if you have any questions about this form or if you need additional copies of this form, please contact W. Joseph Payne at (937) 382-5591 ext. 2686 or at the address given below. 
  

 9 

 1.00 Designation of Beneficiary 
  

	1.01 	Primary Beneficiary: 

  
 I designate the following persons as my Primary Beneficiary or Beneficiaries to receive any amount due under the Award Agreement described at the top of
this form after my death. This benefit will be paid, in the proportion specified, to: 
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  

	1.02 	Contingent Beneficiary 

  
 If one or more of my Primary Beneficiaries dies before I die, I direct that any amount due under the Award Agreement described at the top of this form after
my death: 
  
              Be paid to my other named Primary Beneficiaries in proportion to the allocation given above (ignoring the interest allocated to the deceased Primary
Beneficiary); or 
  
              Be distributed among the following Contingent Beneficiaries. 
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  
                     %
to                                       
                                        
                                        
                    
                                        
         (Name)                              
                                        
          (Relationship) 
  
 Address:
                                        
                                        
                                        
                               
  
 **** 
  

 10 

 Elections made on this form will be effective only after this form is received by W. Joseph Payne and only if it is
fully and properly completed and signed. 
  
 Name: Vtq 
  
 Soc. Sec. No.:
                                        
                                        
                                        
                                        
                             
  
 Date of Birth:
                                        
                                        
                                        
                                        
                             
  
 Address:
                                        
                                        
                                        
                                        
                                     
  
 ___________________________________________________________________________________________

  
 Sign and return this form to W. Joseph Payne at the address given below

  

					
			
	  	 	 	 	  
	 Date
	 	 	 	 Signature

  
 Return this signed form to W.
Joseph Payne at the following address: 
  
 W. Joseph Payne

 ABX Air, Inc. 
 145 Hunter
Drive 
 Wilmington, Ohio 45177 
  
 Received on:
                                     
  
 By:
                                        
                                        

  

 11

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