FORM OF
ALTERNATIVE DISPUTE RESOLUTION AGREEMENT
ALTERNATIVE DISPUTE RESOLUTION AGREEMENT (the "Agreement") dated as of
, 1996, by and between Consolidated Freightways Corporation, a
Delaware corporation (the "Company"), and Consolidated Freightways, Inc., a
Delaware corporation ("CFI").
RECITALS
This Agreement is made pursuant to the Distribution Agreement
("Distribution Agreement") dated as of , 1996 between the
Company and CFI. Each term used herein which is defined in the Distribution
Agreement shall have the same meaning when used herein as it is given in the
Distribution Agreement.
The Company and CFI have determined that it is necessary and desirable
to agree on the procedures described in this Agreement as the sole and exclusive
method for them to resolve any and all disputes which have arisen prior to the
distribution (the "Distribution") to the shareholders of CFI of the shares of
the Company or which may from time to time arise under the Transaction Documents
(as herein defined), and claims which either party may have from time to time
against the other as a result of the Transaction Documents or in any way related
to the Distribution whether such disputes or claims are based on a breach of one
party or its obligations under the Transaction Documents or disagreement between
the parties as to the meaning or application of the Transaction Documents or in
any manner related to or arising out of the Distribution (any such dispute or
claim, a "Dispute").
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained in this Agreement, the parties hereby agree as follows:
ARTICLE I
As used in this Agreement, the following terms shall have the
following meaning (such meanings to be equally applicable to both the singular
and plural forms of the terms defined):
AMOUNT IN CONTROVERSY: the monetary value of any Dispute plus the
monetary value of any future Dispute which could reasonably arise under the
provision at issue.
CPR: the Center for Public Resources, Inc.
CPR REGIONAL OFFICE: the office of the CPR located closest to Palo
Alto, California, or such other office of the CPR as the parties hereto may
agree.
DEMAND: a written demand for arbitration under Article IV of this
Agreement which shall contain a statement setting forth the nature of the
Dispute, the Amount in Controversy and such other information as may be required
under the CPR Rules for Non-Administered Arbitration of Business Disputes as in
effect from time to time (the "Arbitration Rules").
DISPUTE: as defined in the recitals to this Agreement.
REQUEST: a written request for mediation under Article III of this
Agreement which shall contain a brief statement of the nature of the Dispute and
such other information as may be required under the then current CPR Model
Procedure for Mediation of Business Disputes (the "Mediation Rules").
TRANSACTION DOCUMENTS: the Distribution Agreement, the Other
Agreements and the other agreements referred to in Section 3.4 of the
Distribution Agreement.
ARTICLE II
RESOLUTION OF DISPUTES
All Disputes which cannot be resolved by the parties through good
faith negotiation and consultation within sixty (60) days after either party
shall have notified the other of such Dispute shall first be submitted to
mediation pursuant to Article III hereof and the Mediation Rules and such other
rules of procedure as the parties may agree; provided that, in the event of a
conflict between Article III and the Mediation Rules, Article III shall govern.
If a Dispute cannot be resolved through mediation, then such Dispute shall be
submitted to binding arbitration pursuant to Article IV hereof and the Arbi-
tration Rules and such other rules of procedure as the parties may agree;
provided that, in the event of a conflict between Article IV and the Arbitration
Rules, Article IV shall govern.
ARTICLE III
MEDIATION
Section 3.1 REQUEST FOR MEDIATION. Either party to a Dispute may
initiate mediation by filing a Request (along with any copies thereof that may
be required under the Mediation Rules) and a copy of this Agreement with the CPR
Regional Office and by delivering a copy of the Request to the other party.
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Section 3.2 APPOINTMENT OF MEDIATOR. Unless the parties otherwise
agree in writing, the CPR shall appoint a single mediator from the CPR Panel of
Neutrals.
Section 3.3 DATE, TIME AND PLACE. Unless the parties otherwise agree
in writing, all mediation proceedings shall take place in Palo Alto, California.
The date, time and place of each mediation session shall be determined by
agreement of the parties or, if the parties cannot agree within a reasonable
period of time, by the mediator; provided that the first such session shall be
held within fifteen (15) days of the date on which the mediator is appointed.
Section 3.4 TERMINATION. The mediation proceedings shall be
terminated upon the happening of any of the following: (i) by execution of a
settlement agreement by the parties; (ii) by written declaration of the mediator
that further efforts at mediation are no longer worthwhile; or (iii) by written
declaration of one or both parties that the mediation proceedings are
terminated. A written declaration hereunder shall not terminate the mediation
proceedings until notice thereof has been given to the parties, or to the other
party, as appropriate, in accordance with Section 5.4 hereof.
ARTICLE IV
ARBITRATION
Section 4.1 INITIATING ARBITRATION. Either party to a Dispute that
has not been settled or resolved through mediation may initiate arbitration by
filing a Demand and a copy of this Agreement (along with any copies thereof that
may be required under the Arbitration Rules) with the CPR Regional Office within
sixty (60) business days following the termination of the mediation proceedings
and by delivering a copy of the Demand to the other party. Failure to file a
Demand within such period shall constitute an absolute bar to the institution of
any proceedings with respect to such Dispute and a waiver of all claims related
thereto.
Section 4.2 APPOINTMENT OF ARBITRATORS. Unless the parties otherwise
agree in writing, a Dispute subject to this Article IV shall be heard by a panel
of three (3) arbitrators who shall be appointed according to the procedure
contemplated by Rule 6 of the Arbitration Rules.
Section 4.3 ABSENCE OF CONFLICTS. No person shall serve as an
arbitrator in any Dispute in which the person has any financial or personal
interest, except by the written consent of both parties.
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Section 4.4 DATE, TIME AND PLACE. Unless the parties otherwise agree
in writing, all arbitration proceedings shall take place in Palo Alto,
California. The date, time and place of each hearing shall be determined by
agreement of the parties or, if the parties cannot agree within a reasonable
period of time, by the arbitration panel or sole arbitrator (each an "Arbitra-
tor"), as appropriate. The first such hearing shall be held as soon as
practicable following appointment of the Arbitrator(s), but in no event more
than one (1) year after such appointment. Each arbitration shall be governed by
the United States Arbitration Act, 9 U.S.C. Section 1-16, and judgment upon the
award rendered by the Arbitrator(s) may be entered by any court having
jurisdiction thereof.
Section 4.5 AWARD. The Arbitrator(s) may grant any remedy or relief
that the Arbitrator(s) deem just and equitable including, but not limited to,
injunctive relief, judgment interest, attorneys' fees and specific performance;
PROVIDED, HOWEVER, that the Arbitrator(s) shall not be authorized to award
punitive damages.
ARTICLE V
MISCELLANEOUS
Section 5.1 COMPLETE AGREEMENT; CONSTRUCTION. This Agreement and the
Transaction Documents and other agreements and documents referred to therein
shall constitute the entire agreement between the parties with respect to the
subject matter hereof and shall supersede all previous negotiations, commitments
and writings with respect to such subject matter.
Section 5.2 SURVIVAL OF AGREEMENTS. All covenants and agreements of
the parties contained in this Agreement shall survive the Distribution Date.
Section 5.3 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California without regard
to the principles of conflicts of law thereof.
Section 5.4 NOTICE. All notices and other communications required or
permitted to be given or made under this Agreement shall, unless otherwise
provided herein or in the applicable CPR rules, be in writing and shall be
deemed to have been given (i) on the date of personal delivery, or (ii) provided
such notice or communication is actually received by the party to which it is
addressed in the ordinary course of delivery, on the date of (A) deposit in the
United States mail, postage prepaid, by registered or certified mail, return
receipt requested, (B) transmission by telegram, cable, telex or facsimile
transmission, or (C) delivery to a nationally recognized overnight courier
service, in each case addressed
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as set forth below, or to such other person, entity or address as either
party shall designate by notice to the other in accordance herewith:
To the Company: Consolidated Freightways Corporation
000 Xxxxxxxx Xxxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attention: General Counsel
To CFI: Consolidated Freightways, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attention: General Counsel
Section 5.5 WAIVER. No waiver by any party of any of the provisions
of this Agreement will be deemed, or will constitute, a waiver of any other
provision, whether similar, nor will any waiver constitute a continuing waiver.
No waiver will be binding unless executed in writing by the party making the
waiver.
Section 5.6 ASSIGNMENT. Neither party may assign, by operation of
law, merger or otherwise, license, sublicense or otherwise transfer any or all
of its rights or obligations under this Agreement to any other person or entity
without obtaining the prior written consent of the other party.
Section 5.7 AMENDMENTS. This Agreement may not be modified or
amended except by an agreement in writing signed by the parties.
Section 5.8 SUCCESSORS AND ASSIGNS. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
and their respective successors and permitted assigns.
Section 5.9 SUBSIDIARIES. Each of the parties hereto shall cause to
be performed, and hereby guarantees the performance of, all actions, agreements,
and obligations set forth herein or arising hereunder to be performed by any
Subsidiary of such party on and after the Distribution Date.
Section 5.10 NO THIRD PARTY BENEFICIARIES. This Agreement is solely
for the benefit of the parties hereto and their respective Subsidiaries and
Affiliates and should not be deemed to confer upon third parties any remedy,
claim, right or reimbursement or other right.
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Section 5.11 TITLES AND HEADINGS. Titles and headings to articles
and sections herein are inserted for the convenience of reference only and are
not intended to be a part of or to affect the meaning or interpretation of this
Agreement.
Section 5.12 SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render unen-
forceable such provision in any other jurisdiction. Without prejudice to any
rights or remedies otherwise available to any party hereto, each party
acknowledges that damages would be an inadequate remedy for any breach of the
provisions of this Agreement and agrees that the obligations of the parties
hereunder shall be specifically enforceable.
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THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE
ENFORCED BY THE PARTIES.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.
CONSOLIDATED FREIGHTWAYS CORPORATION
By:
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Title:
CONSOLIDATED FREIGHTWAYS, INC.
By:
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Title:
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