New Executive Long Term Incentive Scheme and Issue of Share

NZX Announcement

31 July 2020

New Executive Long Term Incentive Scheme and Issue of Share Rights

Freightways Limited (Freightways) has implemented a new executive long term incentive
(LTI) scheme designed to better encourage long term performance and promote employee
retention. This scheme replaces the previous senior executive performance share plan
established in 2008, which involved partly-paid shares. The new LTI scheme involves
share rights being offered to senior executives, with vesting determined at the end of a 3-
year vesting period. Each share right that vests converts to one Freightways ordinary
share.

Vesting is based on the achievement of the following two total shareholder return (TSR)
hurdles being met over the vesting period:
(i) 50% of the share rights are subject to an absolute TSR, whereby half these share
rights vest if Freightways outperforms the NZX50 index median, pro-rated up to
100% vesting at the 75th percentile of the index constituents; and
(ii) 50% of the share rights are subject to the Company's relative TSR target of profit
performance above the cost of capital, as set by the Board of Directors.

The share rights do not carry a dividend entitlement and are non-transferable.

The last allocation to executives under the old senior executive performance share plan
was in 2018. Accordingly, on 30 July 2020, the Board resolved to make an initial
allocation (in accordance with the rules of the new LTI scheme) of 141,916 share rights
to executives in respect of 2019, with a three-year vesting period commencing 1 July
2019. A capital change notice in respect of the issue of share rights accompanies this
announcement.

It is anticipated that annual allocations will be made each September going forward,
following the release of Freightways’ full year results. The next allocation in respect of
2020 is likely to be made in September 2020, with a 3-year vesting period commencing
1 July 2020.

For further information please contact:

Mark Troughear
Chief Executive Officer
Freightways Limited
Ph: +64 (9) 571 9673

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Capital Change Notice




Section 1: Issuer information
Name of issuer Freightways Limited
NZX ticker code FRE
Class of financial product Unlisted Share Rights
ISIN (If unknown, check on NZX website) Not applicable
Currency NZD
Section 2: Capital change details
Number issued/acquired/redeemed 141,916 Share Rights
Nominal value (if any) Not applicable
Issue/acquisition/redemption price per security No cash consideration is
payable for the issue of the
Share Rights.
Nature of the payment (for example, cash or other
consideration)
Not applicable
Amount paid up (if not in full) Not applicable
Percentage of total class of Financial Products
issued/acquired/redeemed/ (calculated on the number of
Financial Products of the Class, excluding any Treasury Stock,
in existence)
1

100%. First issue of a new
class of financial product.
For an issue of Convertible Financial Products or Options, the
principal terms of Conversion (for example the Conversion
price and Conversion date and the ranking of the Financial
Product in relation to other Classes of Financial Product) or the
Option (for example, the exercise price and exercise date)
See terms of issue below.
Reason for issue/acquisition/redemption and specific authority
for issue/acquisition/redemption/ (the reason for change must
be identified here)
The Share Rights are issued
under the Freightways Limited
Long Term Incentive Scheme.
Total number of Financial Products of the Class after the
issue/acquisition/redemption/Conversion (excluding Treasury
Stock) and the total number of Financial Products of the Class
held as Treasury Stock after the issue/acquisition/redemption.
141,916 unlisted Share Rights.
141,916 ordinary shares if all
Share Rights vest and are
exercised.
There is no treasury stock.
In the case of an acquisition of shares, whether those shares
are to be held as treasury stock
Not applicable
Specific authority for the issue, acquisition, or redemption,
including a reference to the rule pursuant to which the issue,
acquisition, or redemption is made
Board resolution dated 30 July
2020 and Listing Rule 4.6.1.


1
The percentage is to be calculated immediately before the issue, acquisition, redemption or Conversion.

Terms or details of the issue, acquisition, or
redemption (for example: restrictions, escrow
arrangements)
The Share Rights are eligible to vest at
the end of a 3-year vesting period
ending 30 June 2022 ("Vesting
Period"). Vesting of the Share Rights is
subject to the satisfaction of the
following two hurdles:
(1) 50% of the Share Rights are subject
to an absolute Total Shareholder
Return (TSR), whereby half these
Share Rights vest if the Company
outperforms the NZX50 index
median, pro-rated up to 100%
vesting at the 75
th
percentile of the
index constituents, over the Vesting
Period; and
(2) 50% of the Share Rights are subject
to the Company's relative TSR
target of profit performance above
the cost of capital over the Vesting
Period, as set by the Board of
Directors.
Upon vesting, each Share Right can be
converted into one ordinary share in
Freightways on exercise for no cash
payment.
On exercise the holder will be
responsible for any tax obligations
applicable to the remuneration the
shares represent.
The Share Rights are non-transferable.

Date of issue/acquisition/redemption
2
30/07/2020
Section 3: Authority for this announcement and contact person
Name of person

authorised to make this
announcement
Stephan Deschamps
Contact person for this announcement As above
Contact phone number +64 27 562 5666
Contact email address Stephan.deschamps@freightways.co.nz
Date of release through MAP

31/07/2020




2
Continuous issuers using this form in reliance on Rule 3.13.2, please indicate the period during which the relevant
issue/acquisition/redemptions were made (for example, 1 January 2019 to 31 January 2019).