8-KMaterial AgreementsExhibits & Filings

OLD DOMINION FREIGHT LINE, INC. 8-K Report, Material Agreement (Feb 21, 2006)

Filed February 21, 2006For Securities:ODFL

Summary

This Form 8-K filing by Old Dominion Freight Line, Inc. (ODFL) on February 21, 2006, details the establishment and initial grants under two key compensation plans. Primarily, the company has implemented the "2006 Nonqualified Deferred Compensation Plan" effective January 1, 2006. This plan allows eligible highly compensated and management employees to defer a portion of their salary and bonuses to provide retirement benefits. The deferred amounts are held in company-managed accounts, adjusted based on investment performance, and paid out upon retirement, disability, termination, or in specific hardship cases. Furthermore, the filing announces the initial grants under the "Old Dominion Freight Line, Inc. Phantom Stock Plan" on January 30, 2006. This plan awards phantom shares to key employees, with the number of shares determined by a percentage of their 2005 base salary relative to the company's stock price. These awards, subject to plan terms and agreements, represent a significant incentive for executive retention and alignment with shareholder interests. The filing provides specific details on the phantom shares granted to Named Executive Officers, highlighting their participation in this equity-based compensation program.

Key Highlights

  • 1ODFL established the 2006 Nonqualified Deferred Compensation Plan, effective January 1, 2006, to allow eligible employees to defer salary and bonus compensation for retirement benefits.
  • 2The deferred compensation plan is unfunded and maintained primarily for retirement benefits, not as a tax-qualified plan.
  • 3Participants in the deferred compensation plan can elect to defer 3-50% of their regular salary and 5-75% of their bonus annually.
  • 4The company has implemented the Old Dominion Freight Line, Inc. Phantom Stock Plan, with initial awards granted on January 30, 2006.
  • 5Phantom share awards are calculated based on 20% of an eligible key employee's 2005 base salary divided by a three-day average stock price in early February 2006.
  • 6A total of 26,845 phantom shares were awarded to eligible key employees.
  • 7The filing lists specific grants of phantom shares to top executives, including Earl E. Congdon (3,136 shares), John R. Congdon (2,201 shares), and David S. Congdon (1,760 shares).

Frequently Asked Questions

The primary purpose of the 2006 Nonqualified Deferred Compensation Plan is to allow certain highly compensated and management employees of Old Dominion Freight Line, Inc. to defer receipt of current compensation (salary and bonuses) to provide them with retirement benefits.

The number of phantom shares awarded to each eligible key employee is calculated as 20% of their 2005 base salary, divided by the company's three-day average stock price during the period of February 2-6, 2006.

Benefits from the deferred compensation plan can be paid subsequent to normal retirement (age 55), retirement due to disability, termination for reasons other than retirement or death, or in cases of unforeseeable emergencies. Payment methods can include lump sums or installments over a specified period, depending on the event and participant election.

No, the 2006 Nonqualified Deferred Compensation Plan is explicitly stated as not being a tax-qualified retirement plan under Section 401(a) of the Internal Revenue Code. While the Phantom Stock Plan provides for equity-based compensation, it is also a non-qualified plan designed to provide incentives and compensation rather than being a tax-qualified retirement vehicle.