Exhibit 99A
EXECUTIVE BONUS PLAN
HON INDUSTRIES Inc.
As adopted on May 1, 1974, and amended on
April 20, 1976, April 19, 1977, January 31, 1983,
February 5, 1985, November 4, 1986, July 7, 1988
May 4, 1992, November 2, 1992, February 8, 1993,
February 14, 1994, November 14, 1994,
May 8, 1995, November 11, 1996, and
amended and restated as of January 1, 2000
1. Purpose. The purpose of the Executive Bonus Plan (the
"Plan") is to encourage a consistently high standard of
excellence and continued employment by officers and selected
other executives of the Corporation and any subsidiary which
elects to participate in the Plan (an "electing Subsidiary").
The Plan shall be operated at all times in conformance with
applicable government regulations.
2. Participants. For any fiscal year, each person who is
an officer as of the end of such fiscal year of HON INDUSTRIES
Inc. (the "Corporation") or any electing Subsidiary, and each
other executive of the Corporation or any electing Subsidiary as
is selected by the Board of Directors of the Corporation
("Board") as of the end of such fiscal year, shall be eligible to
be Participants in the Plan.
3. Payment. Upon final determination of bonus awards by
the Board or, to the extent delegated by the Board for a fiscal
year, the Human Resources and Compensation Committee of the Board
("Committee"), the bonus awards shall be paid in full in cash,
subject to Section 3(c), as follows:
a. Any bonus award for a fiscal year ending prior to
December 28, 1996, to the extent not already paid to the
Participant, shall be paid to the Participant (or, as
applicable, the Participant's estate) in a single sum
payment not later than March 14, 1997, provided that (A) the
Participant is employed by the Corporation or an electing
Subsidiary on the date of payment or (B) the Participant's
employment with the Corporation and each electing Subsidiary
terminated due to death, disability, retirement after age 55
pursuant to established retirement policies of the
Corporation (a "Retirement"), or for any other reason
(except a termination for cause, as determined by the
Committee) after a Change in Control (as defined below).
b. Effective for each fiscal year ending on or after
December 28, 1996, each bonus award for such fiscal year
shall be paid not later than the last day of the
Corporation's February fiscal month following the end of the
Corporation's fiscal year for which the bonus award is made,
provided, subject to Section 4, that the Participant is
employed by the Corporation or an electing Subsidiary on
such date.
c. The Committee may require payment of any
bonus award (or portion thereof) for a fiscal year
under Section 3(a) or 3(b) in the form of shares of
Bonus Stock issued pursuant to (and as defined in) the
Corporation's Stock-Based Compensation Plan (1) at the
Participant's request, in the amount indicated by such
Participant, subject to the Committee's approval, or
(2) in the amount of up to 50% of such bonus award in
the event that the Committee determines, in its sole
discretion, that the Participant's respective stock
ownership level under the Executive Stock Ownership
Policy does not reflect appropriate progress toward
such Participant's five-year goal thereunder. The
number of shares of Bonus Stock to be paid shall be
determined by dividing the cash amount of the bonus
award under the Plan (or, portion thereof, as elected
by the Participant) for a fiscal year by the average
closing prices of a share of the Corporation's common
stock for the 20 trading days immediately preceding the
date of such payment, with cash paid in lieu of any
fractional share. All Federal, state and local income
tax and other employment tax withholding shall be made
pursuant to Section 5.5 of the Stock-Based Compensation
Plan.
d. As used in the Plan, "Change in Control"
means (i) the acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) (a "Person") of benefi
cial ownership (within the meaning of Rule 13d-3 pro
mulgated under the Exchange Act) of 20% or more of
either (a) the then outstanding shares of common stock
of the Corporation (the "Outstanding Corporation Common
Stock") or (b) the combined voting power of the then
outstanding voting securities of the Corporation
entitled to vote generally in the election of directors
(the "Outstanding Corporation Voting Securities");
provided, however, that for purposes of this subsection
(i), the following acquisitions shall not constitute a
Change in Control: (A) any acquisition directly from
the Corporation, (B) any acquisition by the
Corporation, (C) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained
by the Corporation or any corporation controlled by the
Corporation or (D) any acquisition by any corporation
pursuant to a transaction which complies with clauses
(A), (B) and (C) of subsection (iii) of this Section
3(d); or (ii) individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for
any reason to constitute at least two-thirds of the
Board; provided, however, that any individual becoming
a director subsequent to the date hereof whose
election, or nomination for election by the
Corporation's shareholders, was approved by a vote of
at least three-quarters of the directors then
comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent
Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as
a result of an actual or threatened election contest
with respect to the election or removal of directors or
other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the
Board; or (iii) consummation of a reorganization,
merger or consolidation or sale or other disposition of
all or substantially all of the assets of the
Corporation (a "Business Combination"), in each case,
unless, following such Business Combination, (A) all or
substantially all of the individuals and entities who
were the beneficial owners, respectively, of the
Outstanding Corporation Common Stock and Outstanding
Corporation Voting Securities immediately prior to such
Business Combination beneficially own, directly or
indirectly, more than 50% of, respectively, the then
outstanding shares of common stock and the combined
voting power of the then outstanding voting securities
entitled to vote generally in the election of
directors, as the case may be, of the corporation
resulting from such Business Combination (including,
without limitation, a corporation which as a result of
such transaction owns the Corporation or all or
substantially all of the Corporation's assets either
directly or through one or more subsidiaries) in
substantially the same proportions as their ownership,
immediately prior to such Business Combination of the
Outstanding Corporation Common Stock and Outstanding
Corporation Voting Securities, as the case may be, (B)
no Person (excluding any corporation resulting from
such Business Combination or any employee benefit plan
(or related trust) of the Corporation or such
corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 20% or more
of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business
Combination or the combined voting power of the then
outstanding voting securities of such corporation
except to the extent that such ownership existed prior
to the Business Combination and (C) at least a majority
of the members of the board of directors of the
corporation resulting from such Business Corporation
were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of
the Board, providing for such Business Combination; or
(iv) approval by the shareholders of the Corporation of
a complete liquidation or dissolution of the
Corporation.
4. Termination of Employment. The following provisions shall
apply for any fiscal year commencing after December 28, 1996:
a. If a Participant's employment with the Corporation
and each electing Subsidiary is terminated during a fiscal
year by reason of death, disability or Retirement, the
Participant, or the Participant's estate, shall receive a
bonus award for such fiscal year, determined as if the
Participant had remained employed for such entire fiscal
year, prorated for the number of days during such fiscal
year that have elapsed as of the Participant's termination,
and subject to the first sentence of Section 4(b).
b. If a Participant's employment with the Corporation
and each electing Subsidiary is terminated during a fiscal
year for any reason other than death, disability or
Retirement, the Participant's rights to any bonus award for
such fiscal year will be forfeited. However, the Committee
may, in its discretion, determine to pay a prorated bonus
award for the portion of such fiscal year during which the
Participant was employed by the Corporation or an electing
Subsidiary, except that in no event shall any such prorated
bonus award be paid in the event of termination for cause,
as determined by the Committee.
5. Change in Control. For fiscal years commencing after
December 28, 1996, in the event of a Change in Control (as
defined above), the maximum bonus award for the fiscal year then
in progress, prorated for the number of days in such fiscal year
that have elapsed as of the date of the Change in Control, shall
be paid immediately in cash, without regard to Section 3(c). Any
adjustment or termination of a Participant's participation in the
Plan that occurs at any time on or after the 90th day preceding a
Change in Control shall be of no effect.
6. Administration. The Board shall have full power to
interpret and administer this Plan from time to time in
accordance with the By-laws of the Corporation, except to the
extent provided in the Corporation's Stock-Based Compensation
Plan or to the extent that the Board may have delegated its
powers to the Committee. Decisions of the Board or the Committee
shall be final, conclusive and binding upon all parties. The
Committee shall consist of two or more "non-employee directors"
within the meaning of Rule 16b-3 as promulgated pursuant to
Section 16 of the Securities Exchange Act of 1934.
7. Cost. Each electing Subsidiary shall reimburse the
Corporation for the amount of such bonus awards which shall be
awarded and paid to Participants for services to such electing
Subsidiary, as determined by the Board.
8. Amount of Individual Bonus. For fiscal years beginning
after December 28, 1996, the bonus award for each fiscal year for
any Participant shall be determined by the Board, or, to the
extent delegated by the Board for a fiscal year, by the
Committee, no later than the first meeting of the Board that
occurs during the fiscal year following the year for which the
bonus award is made.
9. General Provisions.
a. The Company shall have the right to deduct any
Federal, state or local taxes applicable to payments under
the Plan. The Committee may permit Participants to satisfy
withholding obligations by electing to have shares of Bonus
Stock withheld.
b. Except as otherwise determined by the Committee, no
right or interest of any Participant in this Plan shall be
assignable or transferable except by will or the laws of
descent and distribution, nor shall any such right or
interest, be subject to any lien, directly, by operation of
law or otherwise, including execution, levy, garnishment,
attachment, pledge or bankruptcy.
c. Except as provided in Sections 4 and 5, the Board
may terminate or amend the Plan at any time.
10. Special Provision for Qualifying Participants.
a. This Section 10 shall apply with respect to any
bonus award made under the Plan with respect to the Chief
Executive Officer of the Corporation and any other
Participant designated by the Board from time to time (each
a "Qualifying Participant"). Not later than the 90th day
after the commencement of the fiscal year for which the
bonus award is made, in addition to any other performance
criteria established by the Committee, the Committee shall
establish in writing Profit Achievement Factors and Personal
Objective Achievement Factors (collectively, "Qualifying
Factors") for each Qualifying Participant. The maximum
bonus award payable to a Qualifying Participant for such
fiscal year based on the degree of attainment of such
Qualifying Factors shall not exceed $2 million. Subject to
Sections 4 and 5, the Committee may adjust any Qualifying
Factor that has been established for any fiscal year,
provided that no such adjustment shall be permitted if it
would cause the Award based on such Qualifying Factor to
fail to satisfy the requirements for performance-based
compensation under Code Section 162(m). Subject to Sections
4 and 5, the Committee may adjust any other performance
criteria established for any fiscal year, provided that no
such adjustment may be based upon the failure, or the
expected failure, to attain or exceed a Qualifying Factor.
In no event shall any bonus award relating to performance
criteria other than Qualifying Factors be dependent upon the
attainment of, or failure to obtain, a bonus award based on
Qualifying Factors.
b. The administration of all aspects of the Plan
applicable to bonus awards relating to Qualifying Factors is
intended to comply with the exception from Section 162(m) of
the Internal Revenue Code of 1986, as amended, for qualified
performance-based compensation and shall be construed,
applied and administered accordingly.
c. For purposes of this Section, (1) "Profit
Achievement Factors" shall mean an objective performance
goal based on one or more of the following: operating
expense ratios, total stockholder return, return on sales,
operating income, operating profit, return on equity, return
on capital, return on assets, return on investment, net
income, operating income, earnings per share, improved asset
management, improved gross margins, generation of free cash,
revenues, market share, stock price, cash flow, retained
earnings, aggregate product price and other product price
measures, and (2) "Personal Objective Achievement Factors"
shall mean an objective performance goal based on one or
more of the following: results of customer satisfaction
surveys, results of employee surveys, employee turnover,
safety record, management of acquisitions, increased
inventory turns, product development and liability, research
and development integration, proprietary protections, legal
effectiveness, handling Federal securities law or
environmental issues, manufacturing efficiencies,
distribution efficiencies, member productivity, system
review and improvement, service reliability, cost
management.
d. This Section 10 shall become effective as of
January 1, 2000, provided, however, that no bonus award
relating to Qualifying Factors shall be paid under the Plan
to any Qualifying Participant unless, prior to such payment,
the provisions of this Section 10 are approved by the
holders of a majority of the securities of the Company
present, or represented, and entitled to vote at a meeting
of stockholders duly held in accordance with the laws of the
State of Iowa.