Exhibit 10.6
NORTHLAND CRANBERRIES, INC.
AMENDED 1995 STOCK OPTION PLAN
October 17, 1996
Section 1. Purpose
The purpose of Northland Cranberries, Inc. 1995 Stock Option
Plan (the "Plan") is to promote the best interests of Northland
Cranberries, Inc. (the "Company") and its shareholders by providing key
employees of the Company and its Affiliates (as defined below) and
directors of the Company who are not employees of the Company and its
Affiliates with an opportunity to acquire or increase their proprietary
interest in the Company. It is intended that the Plan will promote
continuity of management and increased incentive and personal interest in
the welfare of the Company by those who are primarily responsible for
shaping and carrying out the long-range plans of the Company and securing
the Company's continued growth and financial success.
Section 2. Definitions
As used in the Plan, the following terms shall have the
respective meanings set forth below:
(a) "Affiliate" shall mean any entity that, directly or through
one or more intermediaries, is controlled by, controls, or is under common
control with, the Company.
(b) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
(c) "Commission" shall mean the Securities and Exchange
Commission.
(d) "Committee" shall mean the Compensation and Stock Option
Committee of the Board of Directors of the Company (or any other committee
thereof designated by such Board to administer the Plan); provided,
however, that the Committee is composed of not less than two directors,
each of whom is a "disinterested person" within the meaning of Rule 16b-3.
(e) "Directors Fees" shall mean the amount which a Non-Employee
Director (defined below) is paid for serving as a director of the Company
in the relevant year, including separate fees for serving on committees of
the Board of Directors and separate fees for attendance at meetings of the
Board of Directors or any committee of the Board of Directors, but shall
not include any separate fees for any other services provided for the
Company.
(f) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time.
(g) "Fair Market Value" shall mean, with respect to any
property (including, without limitation, any Shares or other securities),
the fair market value of such property determined by such methods or
procedures as shall be established from time to time by the Committee.
(h) "Incentive Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is intended to meet the requirements of
Section 422 of the Code (or any successor provision thereto).
(i) "Key Employee" shall mean any officer or other key employee
of the Company or of any Affiliate who is responsible for or contributes
to the management, growth or profitability of the business of the Company
or any Affiliate as determined by the Committee in its discretion.
(j) "Non-Qualified Stock Option" shall mean an option granted
under Section 6(a) of the Plan that is not intended to be an Incentive
Stock Option and shall mean any option granted to a Non-Employee Director
under Section 6(b) of the Plan.
(k) "Non-Employee Director" shall mean any member of the Board
of Directors of the Company who is not an employee of the Company and its
Affiliates.
(l) "Option" shall mean an Incentive Stock Option or a Non-
Qualified Stock Option.
(m) "Option Agreement" shall mean any written agreement,
contract or other instrument or document evidencing any Option granted
under the Plan.
(n) "Participating Key Employee" shall mean a Key Employee
designated to be granted an Award under the Plan.
(o) "Person" shall mean any individual, corporation,
partnership, association, joint-stock company, trust, unincorporated
organization or government or political subdivision thereof.
(p) "Rule 16b-3" shall mean Rule 16b-3 as promulgated by the
Commission under the Exchange Act, or any successor rule or regulation
thereto.
(q) "Shares" shall mean shares of Class A common stock of the
Company, $0.01 par value, and such other securities or property as may
become subject to Options pursuant to an adjustment made under Section
4(b) of the Plan.
Section 3. Administration
The Plan shall be administered by the Committee; provided,
however, that if at any time the Committee shall not be in existence, the
functions of the Committee as specified in the Plan shall be exercised by
those members of the Board of Directors of the Company who qualify as
"disinterested persons" under Rule 16b-3. Subject to the terms of the
Plan and applicable laws and without limitation by reason of enumeration,
the Committee shall have full discretionary power and authority to:
(i) designate Participating Key Employees; (ii) determine the type of
Options to be granted to each Participating Key Employee under the Plan;
(iii) determine the number of Shares to be subject to each Option granted
to Participating Key Employees; (iv) determine the terms and conditions of
any Option granted to a Participating Key Employee; (v) determine whether,
to what extent and under what circumstances Options granted to
Participating Key Employees may be exercised in cash, Shares, other
securities or other property, and the method or methods by which Options
may be exercised, canceled, forfeited or suspended; (vi) determine
whether, to what extent and under what circumstances Shares with respect
to Options granted to Participating Key Employees under the Plan shall be
deferred either automatically or at the election of the holder thereof or
of the Committee; (vii) interpret and administer the Plan and any
instrument or agreement relating to, or Option made under, the Plan
(including, without limitation, any Option Agreement); (viii) establish,
amend, suspend or waive such rules and regulations and appoint such agents
as it shall deem appropriate for the proper administration of the Plan;
and (ix) make any other determination and take any other action that the
Committee deems necessary or desirable for the administration of the Plan.
Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations and other decisions under or with respect
to the Plan or any Option shall be within the sole discretion of the
Committee, may be made at any time or from time to time, and shall be
final, conclusive and binding upon all Persons, including the Company, any
Affiliate, any Participating Key Employee, any holder or beneficiary of
any Option, any shareholder and any employee of the Company or of any
Affiliate.
Section 4. Shares Available for Award
(a) Shares Available. Subject to adjustment as provided in
Section 4(b):
(i) Number of Shares Available. The number of Shares
with respect to which Options may be granted under the Plan
shall be 800,000 (on a post-September 3, 1996, two-for-one stock
split basis).
(ii) Accounting for Awards. The number of Shares
covered by an Option under the Plan, or to which such Option
relates, shall be counted on the date of grant of such Option
against the number of Shares available for granting Options
under the Plan.
(iii) Sources of Shares Deliverable Under Options.
Any Shares delivered pursuant to the exercise of an Option may
consist, in whole or in part, of authorized and unissued Shares
or of treasury Shares.
(b) Adjustments. In the event that the Committee shall
determine that any dividend or other distribution (whether in the form of
cash, Shares, other securities or other property), recapitalization, stock
split, reverse stock split, reorganization, merger, consolidation, split-
up, spin-off, combination, repurchase or exchange of Shares or other
securities of the Company, issuance of warrants or other rights to
purchase Shares or other securities of the Company, or other similar
corporate transaction or event affects the Shares such that an adjustment
is determined by the Committee to be appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to
be made available under the Plan, then the Committee may, in such manner
as it may deem equitable, adjust any or all of (i) the number and type of
Shares subject to the Plan and which thereafter may be made the subject of
Options under the Plan; (ii) the number and type of Shares subject to
outstanding Options; and (iii) the grant, purchase or exercise price with
respect to any Option, or, if deemed appropriate, make provision for a
cash payment to the holder of an outstanding Option; provided, however, in
each case, that with respect to Incentive Stock Options no such adjustment
shall be authorized to the extent that such authority would cause the Plan
to violate Section 422(b) of the Code (or any successor provision
thereto); and provided further that the number of Shares subject to any
Option shall always be a whole number.
Section 5. Eligibility
Any Key Employee, including any executive officer or employee-
director of the Company or of any Affiliate, who is not a member of the
Committee shall be eligible to be designated a Participating Key Employee.
All Non-Employee Directors shall receive Non-Qualified Stock Options as
provided in Section 6(b).
Section 6. Grants of Options
(a) Option Awards to Key Employees. The Committee is hereby
authorized to grant Options to Key Employees with the terms and conditions
as set forth below and with such additional terms and conditions, in
either case not inconsistent with the provisions of the Plan, as the
Committee shall determine in its discretion.
(i) Exercise Price. The exercise price per Share of
an Option granted pursuant to this Section 6(a) shall be
determined by the Committee; provided, however, that such
exercise price shall not be less than 100% of the Fair Market
Value of a Share on the date of grant of such Option.
(ii) Option Term. The term of each Option shall be
fixed by the Committee; provided, however, that in no event
shall the term of any Option exceed a period of ten years from
the date of its grant.
(iii) Exercisability and Method of Exercise. An
Option shall become exercisable in such manner and within such
period or periods and in such installments or otherwise as shall
be determined by the Committee. The Committee also shall
determine the method or methods by which, and the form or forms,
including, without limitation, cash, Shares, other securities,
other property or any combination thereof, having a Fair Market
Value on the exercise date equal to the relevant exercise price,
in which payment of the exercise price with respect to any
Option may be made or deemed to have been made.
(iv) Incentive Stock Options. The terms of any
Incentive Stock Option granted under the Plan shall comply in
all respects with the provisions of Section 422 of the Code (or
any successor provision thereto) and any regulations promulgated
thereunder. Notwithstanding any provision in the Plan to the
contrary, no Incentive Stock Option may be granted hereunder
after the tenth anniversary of the adoption of the Plan by the
Board of Directors of the Company.
(b) Non-Qualified Stock Option Awards to Non-Employee
Directors. Each Non-Employee Director shall automatically be granted Non-
Qualified Stock Options under the Plan in the manner set forth in this
Section 6(b). A Non-Employee Director may hold more than one Non-
Qualified Stock Option, but only on the terms and subject to any
restrictions set forth herein.
(i) Exercise Price. The exercise price per Share
shall be equal to 100% of the Fair Market Value of a Share on
the date of grant of such Option. The "market value" of a Share
on the date of grant to the Non-Employee Director shall be the
last bid price per Share for the Shares in the Nasdaq National
Market on the trading date next preceding such grant date;
provided, however, that if the principal market for the Shares
is then a national securities exchange, the "market value" shall
be the closing bid price per Share for the Shares on the
principal securities exchange on which the Shares are traded on
the trading date next preceding the date of grant, or in either
case above, if no trading occurred on the trading date next
preceding the date on which the Non-Qualified Stock Option is
granted, then the "market price" per Share shall be determined
with reference to the next preceding date on which the Shares
were traded.
(ii) Grant of Options. On the last day of each fiscal
year of the Company during the existence of the Plan, each Non-
Employee Director shall be automatically granted an Option to
purchase 1,000 Shares. All Options granted to Non-Employee
Directors shall be Non-Qualified Stock Options.
(iii) Exercisability and Termination of Options.
Except as expressly provided herein, Non-Qualified Stock Options
granted to Non-Employee Directors under the Plan shall not be
exercisable until one (1) year from the date on which such Non-
Qualified Stock Option is granted and shall terminate on the
earlier of:
(A) five years after the date of grant;
(B) three months after the Non-Employee
Director ceases to be a director of the Company by
reason of death, disability or retirement after
attaining age 65; or
(C) immediately upon the Non-Employee
Director ceasing to be a director of the Company for
any reason other than by reason of death, disability
or retirement.
If a Non-Employee Director ceases to be a director of the
Company by reason of death, disability or retirement prior to
the date the Non-Statutory Stock Option becomes exercisable, the
Non-Statutory Stock Option shall become immediately exercisable
in full.
(iv) Exercise of Options. A Non-Qualified Stock
Option granted to a Non-Employee Director may be exercised,
subject to its terms and conditions and the terms and conditions
of the Plan, in full at any time or in part from time to time by
delivery to the Company at its principal office in Wisconsin
Rapids, Wisconsin, of a written notice of exercise specifying
the number of Shares with respect to which the Non-Qualified
Stock Option is being exercised. Any notice of exercise shall
be accompanied by full payment of the Option price of the Shares
being purchased (x) in cash or its equivalent; (y) by tendering
previously acquired shares (valued at their Fair Market Value as
of the date of exercise); or (z) by any combination of
subparagraphs (x) and (y). No Shares shall be issued until full
payment therefor has been made.
(c) General.
(i) No Consideration for Options. Options shall be
granted for no cash consideration unless otherwise determined by
the Committee.
(ii) Option Agreements. Each Option granted under the
Plan shall be evidenced by an Option Agreement in such form
(consistent with the terms of the Plan) as shall have been
approved by the Committee.
(iii) Awards May Be Granted Separately or
Together. Options to Participating Key Employees under the Plan
may be granted either alone or in addition to, in tandem with,
or in substitution for, any other award granted under any other
plan of the Company or any Affiliate. Options granted in
addition to, or in tandem with, other awards granted under any
other plan of the Company or any Affiliate, may be granted
either at the same time as or at a different time from the grant
of such other awards.
(iv) Limits on Transfer of Options. No Option shall
be assignable, alienable, saleable or transferable otherwise
than by will or by the laws of descent and distribution;
provided, however, that a Participating Key Employee at the
discretion of the Committee may, and a Non-Employee Director
shall, be entitled, in the manner established by the Committee,
to designate a beneficiary or beneficiaries to exercise his or
her rights, and to receive any property distributable, with
respect to any Option upon the death of the Participating Key
Employee or the Non-Employee Director, as the case may be. Each
Option shall be exercisable, during the lifetime of the
Participating Key Employee or the Non-Employee Director, only by
such individual or, if permissible under applicable law, by such
individual's guardian or legal representative. No Options may
be pledged, alienated, attached or otherwise encumbered, and any
purported pledge, alienation, attachment or encumbrance thereof
shall be void and unenforceable against the Company or any
Affiliate.
(v) Term of Options. Except as otherwise provided in
the Plan, the term of each Option shall be for such period as
may be determined by the Committee.
(vi) Share Certificates; Representation. All
certificates for Shares delivered under the Plan pursuant to the
exercise of any Option shall be subject to such stop transfer
orders and other restrictions as the Committee may deem
advisable under the Plan or the rules, regulations and other
requirements of the Commission, Nasdaq Stock Market or any stock
exchange or other market upon which such Shares are then listed
or traded, and any applicable federal or state securities laws,
and the Committee may cause a legend or legends to be put on any
such certificates to make appropriate reference to such
restrictions. The Committee may require each Participating Key
Employee, Non-Employee Director or other Person who acquires
Shares under the Plan by means of an Option originally granted
to a Participating Key Employee, Non-Employee Director or other
Person to represent to the Company in writing that such
Participating Key Employee, Non-Employee Director or other
Person is acquiring the Shares without a view to the
distribution thereof.
Section 7. Amendment and Termination of the Plan; Correction of
Defects and Omissions
(a) Amendments to and Termination of the Plan. The Board of
Directors of the Company may at any time amend, alter, suspend,
discontinue or terminate the Plan; provided, however, that shareholder
approval of any amendment of the Plan shall also be obtained if otherwise
required by: (i) the rules and/or regulations promulgated under Section 16
of the Exchange Act (in order for the Plan to remain qualified under Rule
16b-3); (ii) the Code or any rules promulgated thereunder (in order to
allow for Incentive Stock Options to be granted under the Plan); or
(iii) the quotation or listing requirements of the Nasdaq National Market
or any principal securities exchange or market on which the Shares are
then traded (in order to maintain the quotation or listing of the Shares
thereon). Termination of the Plan shall not affect the rights of
Participating Key Employees and Non-Employee Directors with respect to
Options previously granted to them, and all unexpired Options shall
continue in force and effect after termination of the Plan except as they
may lapse or be terminated by their own terms and conditions.
(b) Correction of Defects, Omissions and Inconsistencies. The
Committee may in its discretion correct any defect, supply any omission or
reconcile any inconsistency in any Option or Option Agreement in the
manner and to the extent it shall deem desirable to carry the Plan into
effect.
Section 8. General Provisions
(a) No Rights to Awards. No Key Employee, Participating Key
Employee or other Person (other than a Non-Employee Director to the extent
provided in Section 6(b) of the Plan) shall have any claim to be granted
any Option under the Plan, and there is no obligation for uniformity of
treatment of Key Employees, Participating Key Employees or holders or
beneficiaries of Options under the Plan. The terms and conditions of
Options need not be the same with respect to each Participating Key
Employee.
(b) Withholding. No later than the date as of which an amount
first becomes includable in the gross income of a Participating Key
Employee for federal income tax purposes with respect to any Option under
the Plan, the Participating Key Employee shall pay to the Company, or make
arrangements satisfactory to the Company regarding the payment of any
federal, state, local or foreign taxes of any kind required by law to be
withheld with respect to such amount. Unless otherwise determined by the
Committee, withholding obligations arising with respect to Options granted
to Participating Key Employees under the Plan may be settled with Shares
previously owned by the Participating Key Employee; provided, however,
that the Participating Key Employee may not settle such obligations with
Shares that are part of, or are received upon exercise of, the Option that
gives rise to the withholding requirement. The obligations of the Company
under the Plan shall be conditional on such payment or arrangements, and
the Company and any Affiliate shall, to the extent permitted by law, have
the right to deduct any such taxes from any payment otherwise due to the
Participating Key Employee. The Committee may establish such procedures
as it deems appropriate for the settling of withholding obligations with
Shares, including, without limitation, the establishment of such
procedures as may be necessary to satisfy the requirements of Rule 16b-3.
With the consent of the Committee, an Option holder may be
permitted to satisfy the Company's withholding tax requirements by
electing to have the Company withhold shares otherwise issuable to the
Option holder. The election shall be made in writing and shall be made
according to such rules and in such form as the Company may determine.
(c) No Limit on Other Compensation Arrangements. Nothing
contained in the Plan shall prevent the Company or any Affiliate from
adopting or continuing in effect other or additional compensation
arrangements, and such arrangements may be either generally applicable or
applicable only in specific cases.
(d) Rights and Status of Recipients of Options. The grant of
an Option shall not be construed as giving a Participating Key Employee
the right to be retained in the employ of the Company or any Affiliate.
Further, the Company or any Affiliate may at any time dismiss a
Participating Key Employee from employment, free from any liability, or
any claim under the Plan, unless otherwise expressly provided in the Plan
or in any Option Agreement. The grant of an Option to a Non-Employee
Director pursuant to Section 6(b) of the Plan shall confer no right on
such Non-Employee Director to continue as a director of the Company.
Except for rights accorded under the Plan and under any applicable Option
Agreement, Participating Key Employees and Non-Employee Directors shall
have no rights as holders of Shares as a result of the granting of Options
hereunder.
(e) Unfunded Status of the Plan. Unless otherwise determined
by the Committee, the Plan shall be unfunded and shall not create (or be
construed to create) a trust or a separate fund or funds. The Plan shall
not establish any fiduciary relationship between the Company or the
Committee and any Participating Key Employee, Non-Employee Director or
other Person. To the extent any Person holds any right by virtue of a
grant under the Plan, such right (unless otherwise determined by the
Committee) shall be no greater than the right of an unsecured general
creditor of the Company.
(f) Governing Law. The validity, construction and effect of
the Plan and any rules and regulations relating to the Plan shall be
determined in accordance with the internal laws of the State of Wisconsin
and applicable federal law.
(g) Severability. If any provision of the Plan or any Option
Agreement or any Option is or becomes or is deemed to be invalid, illegal
or unenforceable in any jurisdiction, or as to any Person or Option, or
would disqualify the Plan, any Option Agreement or any Option under any
law deemed applicable by the Committee, such provision shall be construed
or deemed amended to conform to applicable laws, or if it cannot be so
construed or deemed amended without, in the determination of the
Committee, materially altering the intent of the Plan, any Option
Agreement or the Option, such provision shall be stricken as to such
jurisdiction, Person or Option, and the remainder of the Plan, any such
Option Agreement and any such Option shall remain in full force and
effect.
(h) No Fractional Shares. No fractional Shares or other
securities shall be issued or delivered pursuant to the Plan or any Option
Agreement, and the Committee shall determine (except as otherwise provided
in the Plan) whether cash, other securities or other property shall be
paid or transferred in lieu of any fractional Shares or other securities,
or whether such fractional Shares or other securities or any rights
thereto shall be canceled, terminated or otherwise eliminated.
(i) Headings. Headings are given to the Sections and
subsections of the Plan solely as a convenience to facilitate reference.
Such headings shall not be deemed in any way material or relevant to the
construction or interpretation of the Plan or any provision thereof.
Section 9. Effective Date of the Plan
The Plan shall be effective as of May 17, 1995 subject to
shareholder approval of the Plan within 12 months following the date of
adoption of the Plan by the Board of Directors, and all Options granted
under the Plan prior to the date of shareholder approval shall be subject
to such approval and the effective date of such Option grants shall be
deemed to be the date of such shareholder approval.
Section 10. Term of the Plan
No Option shall be granted under the Plan following the seventh
anniversary of its effective date. However, unless otherwise expressly
provided in the Plan or in an applicable Option Agreement, any Option
theretofore granted may extend beyond such date and, to the extent set
forth in the Plan, the authority of the Committee to amend, alter, adjust,
suspend, discontinue or terminate any such Option, or to waive any
conditions or restrictions with respect to any such Option, and the
authority of the Board of Directors of the Company to amend the Plan,
shall extend beyond such date.