UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
September 20, 2008
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Date of Report (Date of earliest event reported)
Con-way Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-5046 94-1444798
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation or Number)
organization)
2855 Campus Drive, Suite 300, San Mateo, California 94403
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(Address of principal executive offices)
(zip code)
Registrant's telephone number, including area code:
(650) 378-5200
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(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligations of the registrant
under any of the following provisions (see General Instruction A.2
below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF
DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATION
ARRANGEMENTS OF CERTAIN OFFICERS.
(A) EXECUTIVE SEVERANCE AGREEMENTS
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The Company (or, in the case of Messrs. Bianco, Labrie and Schmidt, the
Company subsidiary that employs the executive) is party to a severance
agreement with each of the following executive officers, which agreements
prescribe certain severance benefits to be provided to the executives in the
event of a change in control (as defined in the agreements).
Douglas W. Stotlar President and Chief Executive Officer
Stephen L. Bruffett Senior Vice President and Chief Financial Officer
Jennifer W. Pileggi Senior Vice President and General Counsel
Robert L. Bianco Senior Vice President
John G. Labrie Senior Vice President
Herbert J. Schmidt Senior Vice President
Kevin C. Schick Vice President - Operational Accounting
Under the terms of the agreements, each of the executives named above (other
than Mr. Bruffett) is entitled to receive a severance payment equal to three
times annual base salary and annual bonus, plus certain additional benefits,
in the event of a qualifying termination of employment following a change in
control. Mr. Bruffett is entitled to receive a severance payment equal to two
times annual base salary and annual bonus, plus certain additional benefits,
in the event of a qualifying termination of employment following a change in
control. In addition, the agreements provide that the executives are entitled
to receive tax gross-up payments from the Company or Company subsidiary, as
applicable, to cover all excise taxes, if any, which are owed under Section
280G of the Internal Revenue Code as a result of the severance payments and
benefits.
Each of the severance agreements described above is currently scheduled to
terminate on December 31, 2009. However, each agreement also contains an
"evergreen" provision that will automatically extend the term of the
agreement for an additional year on January 1 of each year unless, not later
than September 30 of the preceding year, the executive officer, on the one
hand, or the Company or the Company subsidiary, on the other hand, gives
written notice to the other party of an intention not to extend the term of
the agreement. As a result, absent any such notice, on January 1, 2009 the
term of each of the severance agreements described above would automatically
be extended to December 31, 2010.
At a meeting held on September 20, 2008, the Compensation Committee of the
Board of Directors of the Company authorized and directed the Company and the
relevant Company subsidiaries to give the notices not to extend the terms of
the severance agreements described above, and such notices have been sent to
the executive officers. However, at the same meeting the Compensation
Committee authorized the Company and Company subsidiaries to enter into new
severance agreements with the executive officers named above. The new
agreements will contain the same terms as the existing agreements, except as
follows:
(i) the new agreements will include restrictive covenants regarding
confidential information, non-solicitation and non-disparagement; and
(ii)the new agreements will provide for an automatic reduction in
severance benefits to the executive, if (A) the benefits otherwise
payable to the executive would be subject to an excise tax under
Section 280G of the Internal Revenue Code, and (B) a reduction in
benefits of 10% or less would result in the benefits no longer being
subject to the 280G excise tax. In these circumstances, the benefits
to the executive would be reduced to the extent necessary (but not by
more than 10%) so that the benefits would not be subject to Section
280G excise tax.
The Company currently expects to provide new agreements to the executives for
signature before the end of calendar year 2008.
In addition to the executives named above, approximately six Level 3
executives who currently have severance agreements which entitle them to
receive severance payments equal to two times annual base salary and annual
bonus, plus certain additional benefits, in the event of a qualifying
termination of employment following a change in control, have received notice
that the agreements will not be extended, and will be eligible to receive new
severance agreements containing the terms described above.
(B) EQUITY AWARDS TO STEPHEN L. BRUFFETT
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As disclosed in the Company's Report on Form 8-K filed on August 14, 2008,
the Company's new Senior Vice President and Chief Financial Officer, Stephen
L. Bruffett, is to receive a one-time signing grant of (i) 7,000 shares of
restricted stock that will vest in full upon the third anniversary of the
date of grant, and (ii) 10,000 stock options that will vest in equal annual
installments and have a 10-year term. At a meeting held on September 20,
2008, the Compensation Committee awarded these grants to Mr. Bruffett.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Con-way Inc.
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(Registrant)
September 25, 2008 /s/ Jennifer W. Pileggi
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Jennifer W. Pileggi
Senior Vice President, General Counsel
and Corporate Secretary
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