My situation is exact as described in the Tax FAQ section at tax website (cited at the end). However, I was even confused what shall I do. I didn't want to be illegally self-employed but I have no controll on the company's decision.
Here is the citation from the website:
"I am an F-1 student who worked under CPT in 2004. I received Form 1099 misc. What should I do?
For income tax purposes, you will be considered self-employed (hence, the Form 1099). You should file Form 1040NR with Schedule C and pay income and Social Security tax on your earnings. Note that even though you did NOT have permission to be self-employed, you must still file the required tax forms.
CPT requires that you be employed by a company. You are not allowed to be self-employed while in the U.S. in F-1 status for immigration purposes. "
Thank you very much!