EXHIBIT 10i.
WINNEBAGO INDUSTRIES, INC.
EXECUTIVE SHARE OPTION PLAN
(Amended and Restated Effective January 1, 2001)
TABLE OF CONTENTS
ARTICLE PAGE
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ARTICLE I
PURPOSE.................................................................1
ARTICLE II
DEFINITIONS AND CONSTRUCTION............................................1
ARTICLE III
OPTION GRANT............................................................4
ARTICLE IV
OPTION EXERCISE.........................................................8
ARTICLE V
AMENDMENT OR TERMINATION...............................................10
ARTICLE VI
ADMINISTRATION.........................................................11
ARTICLE VII
TRUST PROVISIONS.......................................................13
ARTICLE VIII
MISCELLANEOUS PROVISIONS...............................................13
WINNEBAGO INDUSTRIES, INC.
EXECUTIVE SHARE OPTION PLAN
ARTICLE I
PURPOSE
1.1 PURPOSE. The purpose of the Plan is to provide stock options to
certain key individuals, commensurate with their contributions to the success of
the Employer, in a form that will provide incentives and rewards for superior
performance, encourage the recipients to continue in the employment of the
Employer, and allow the recipients to diversify their investment portfolios.
1.2 INTENT. The Plan is intended to be a nonqualified stock option plan
within the meaning of Section 83 of the Code. The Plan is not intended to be a
plan covered by the Employee Retirement Income Security Act of 1974, as amended.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
As used herein, the following capitalized words and phrases shall have
the respective meanings set forth below:
2.1 "BENEFICIARY" means the person or persons designated by a
Participant, pursuant to Section 3.7, to exercise an Option after the
Participant's death.
2.2 "BOARD OF DIRECTORS" OR "BOARD" means the board of directors of the
Employer.
2.3 "CHANGE OF CONTROL" for the purposes of the Plan shall mean the
time when (i) any Person, becomes an Acquiring Person, or (ii) individuals who
shall qualify as Continuing Directors of the Company shall have ceased for any
reason to constitute at least a majority of the Board of Directors of the
Company; provided, however, that in the case of either clause (i) or (ii) a
Change of Control shall not be deemed to have occurred if the event shall have
been approved prior to the occurrence thereof by a majority of the Continuing
Directors who shall then be members of such Board of Directors, and in the case
of clause (i), a Change of Control shall not be deemed to have occurred upon the
acquisition of stock of the Company by a pension, profit sharing, stock bonus,
employee stock ownership plan or other retirement plan intended to be qualified
under Section 401(a) of the Internal Revenue Code of 1986, as amended,
established by the Company or any subsidiary of the Company. (In addition, stock
held by such a plan shall not be treated as outstanding in determining ownership
percentages for purposes of this definition.)
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For the purpose of the definition "Change of Control:"
(a) "Continuing Director" means (i) any member of the Board of
Directors of the Company, while such person is a member of the Board, who is not
an Affiliate or Associate of any Acquiring Person or of any such Acquiring
Person's Affiliate or Associate and was a member of the Board prior to the time
when such Acquiring Person shall have become an Acquiring Person, and (ii) any
successor of a Continuing Director, while such successor is a member of the
Board, who is not an Acquiring Person or any Affiliate or Associate of any
Acquiring Person or a representative or nominee of an Acquiring Person or of any
affiliate or associate of such Acquiring Person and is recommended or elected to
succeed the Continuing Director by a majority of the Continuing Directors.
(b) "Acquiring Person" means any person or any individual or group of
Affiliates or Associates of such Person who acquires the beneficial ownership,
directly or indirectly, of 20% or more of the outstanding stock of the Company
if such acquisition occurs in whole or in part, except that the term "Acquiring
Person" shall not include a Hanson Family Member or an Affiliate or Associate of
a Hanson Family Member.
(c) "Affiliate" means a person that directly or indirectly through one
or more intermediaries, controls, or is controlled by, or is under common
control with, the person specified.
(d) "Associate" means (1) any corporate, partnership, limited liability
company, entity or organization (other than the Company or a majority-owned
subsidiary of the Company) of which such a Person is an officer, director,
member, or partner or is, directly or indirectly the beneficial owner of ten
percent (10%) or more of any class of equity securities, (2) any trust or fund
in which such person has a substantial beneficial interest or as to which such
person serves as trustee or in a similar fiduciary capacity, (3) any relative or
spouse of such person, or any relative of such spouse, or (4) any investment
company for which such person or any Affiliate of such person serves as
investment advisor.
(e) "Hanson Family Member" means John K. Hanson and Luise V. Hanson
(and the executors or administrators of their estates), their lineal descendants
(and the executors or administrators of their estates), the spouses of their
lineal descendants (and the executors or administrators of their estates), and
the John K. and Luise V. Hanson Foundation.
(f) "Company" means Winnebago Industries Inc., an Iowa corporation.
(g) "Person" means an individual, corporation, limited liability
company, partnership, association, joint stock company, trust, unincorporated
organization or government or political subdivision thereof.
2.4 "CODE" means the Internal Revenue Code of 1986, any amendments
thereto, and any regulations or rulings issued thereunder.
2.5 "COMMITTEE" means the Winnebago Compensation Committee appointed in
accordance with Section 6.1.
2.6 "EFFECTIVE DATE" means April 1, 1997 as originally adopted by the
Board of Directors. The effective date of this amended and restated plan is
January 1, 2001.
2.7 "EMPLOYEE" means any key individual, including, but not limited to,
a person in an executive position with the Employer, who is employed by the
Employer.
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2.8 "EMPLOYER" means Winnebago Industries, Inc. and any successor
thereto.
2.9 "ERISA" means the Employee Retirement Income Security Act of 1974,
any amendments thereto, and any regulations or rulings issued thereunder.
2.10 "EXERCISE DATE" means, with respect to any Option, the date on
which the Option is exercised by a Participant.
2.11 "EXERCISE PERIOD " means the period during which a Participant may
exercise an Option, as determined under Section 4.1.
2.12 "EXERCISE PRICE" means the price to be paid by a Participant to
exercise an Option, as determined under Section 3.3.
2.13 "GRANT DATE" means, with respect to any Option, the date on which
the Option Agreement is executed by the Employer and the Participant.
2.14 "MARKET PRICE" means the closing price of a share of Stock
reflected in the consolidated trading tables of the Wall Street Journal
(presently the NYSE Composite Transactions), or other recognized market source,
as determined by the Committee, on the applicable date of reference hereunder,
or if there is no sale on such date, then the closing price on the last previous
day on which a sale is reported. In the case of open-end mutual fund shares, the
Market Price means the net asset value per share as reported by the fund in such
publication on the applicable date of reference hereunder.
2.15 "OPTION" means the right of a Participant, granted by the Employer
in accordance with Section 3.2, to purchase Stock from the Employer at the
Exercise Price.
2.16 "OPTION AGREEMENT" means an agreement setting forth the terms of
an Option executed by the Employer and a Participant pursuant to Section 3.2.
2.17 "PARTICIPANT" means any Employee (i) who meets the eligibility
requirements of Section 3.1 or (ii) who has received an award of an Option in
accordance with Section 3.2 and whose Option has not been completely exercised
or lapsed.
For purposes of this Plan, Participants shall be categorized under the
following classifications and such additional classifications which shall
hereafter be determined by Human Resources Committee of the Board from time to
time:
(i) Chief Executive Officer
(ii) Class A Officer
(iii) Class B Executive Employees
(iv) Class C Management Employees
2.18 "PLAN" means the Winnebago Industries, Inc. Executive Share Option
Plan, as set forth herein and from time to time amended.
2.19 "STOCK" means shares of common or preferred stock of a corporation
listed on a national securities exchange (exclusive of the stock of Winnebago
Industries, Inc.) or NASDAQ, or shares of a regulated investment company
designated by the Committee as subject to purchase through the exercise of an
Option.
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2.20 "TERMINATION OF EMPLOYMENT" means an Employee's separation from
the service of the Employer (including all subsidiaries and affiliates of the
Employer) by reason of resignation, discharge, death or other termination. The
Committee may, in its discretion, determine whether any leave or other absence
from service constitutes a Termination of Employment for purposes of the Plan.
2.21 "TRUST" means the trust established pursuant to Article VII to
hold the Stock that is subject to purchase through the exercise of an Option.
2.22 "TRUST AGREEMENT" means an agreement setting forth the terms of
the Trust established pursuant to Article VII.
2.23 "TRUST FUND" means the Stock subject to an Option that is held in
the Trust
2.24 "TRUSTEE" means the persons or institution acting as trustee of
the Trust.
ARTICLE III
OPTION GRANT
3.1 ELIGIBILITY. Options may be granted to any Employee selected by the
Human Resources Committee of the Board of Directors from the key Employees of
the Employer who have the capability of making a substantial contribution to the
success of the Employer. In making this selection, the Human Resources Committee
of the Board of Directors shall consider any factors that it deems relevant,
including the individual's functions, responsibilities, value of services to the
Employer and past and potential contributions to the Employer's profitability
and growth. Participation shall commence on the next day following the last
Saturday of November, February, May, or August subsequent to an Employee's
selection by the Human Resources Committee of the Board of Directors.
3.2 GRANT OF OPTIONS. Options may be granted by the Committee at any
time on or after the Effective Date and prior to the termination of the Plan.
Options may be granted, at the discretion of the Committee, in the form of
outright awards, in exchange for a specified amount of the future compensation
or bonus of the Participant, or in return for the Participant's agreement to
relinquish rights to unfunded, nonqualified deferred compensation that he or she
has accrued but does not have a current right to receive. While a Participant
may agree to exchange all or a portion of any future bonus or incentive
compensation payable to him or her for an Option, in the manner prescribed by
the Committee and prior to the fiscal year in which such compensation is earned,
the maximum percentage of future base compensation which a Participant may
exchange for an Option during a calendar year shall not exceed 30 percent. No
Committee member may take part in any way in determining the amount of any award
of an Opinion to himself or herself.
(a) SUBMISSION OF REQUESTS TO EXCHANGE COMPENSATION. Any specified
exchange of future base compensation or bonus by a Participant for an Option
must be executed by the Participant and the Committee before the beginning of
the calendar year in which the base compensation will be earned or before the
fiscal year in which the bonus will be earned. In the case of a newly eligible
Participant, such specified initial request to exchange compensation shall be
filed with the Committee within 30 days following the effective date of his or
her Plan eligibility and prior to the rendition of any services to which any
exchanged base compensation pertains or prior to the commencement of any
quarterly fiscal period beginning on the next day following the last Saturday of
November, February, May, and August with respect to any specified exchanges of
quarterly bonuses.
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(b) GRANT DATE AND OPTION AGREEMENT. Options granted in exchange for a
specified amount of the future base compensation of the Participant shall be
granted in January of each year and shall reflect the requested exchange of base
compensation of the Participant for the calendar year.
Options granted in exchange for a specified amount of the future bonus
of the Participant shall be granted quarterly following the determination of
such bonus as of the last Saturday in November, February, May, and August of
each fiscal year and shall reflect the requested exchange of bonus of the
Participant for the fiscal quarter (excluding any fiscal quarter during which a
Participant's Termination of Employment occurs). Options granted in the form of
outright awards or in exchange for the Participant's agreement to relinquish
rights to nonqualified deferred compensation which the Participant does not have
a current right to receive may be granted to Participant at any time at the
discretion of the Committee.
Options shall become effective upon the execution by Employer and the
Participant of an Option Agreement specifying the Stock, the number of shares
subject to the Option the Exercise Price, and such other terms and in such form
as the Committee may from time to time determine in accordance with the Plan.
Any items not specified in the Plan shall be specified in the Option Agreement.
(c) EFFECT OF TERMINATION. In the event that a Participant's employment
with the Employer terminates prior to the grant of his or her Option in January
pertaining to a requested exchange of base compensation, an amount of
compensation equivalent to the amount of foregone base compensation, which was
to be exchanged for an Option, through the date of Termination of Employment,
shall be paid to the Participant by the Employer upon his or her Termination of
Employment.
(d) MAXIMUM OPTION GRANTS. The maximum number of underlying cumulative
share units permitted to be covered by all Option grants made to any one
Participant throughout his or her participation in the Plan is that number of
units for which the cumulative Market Price of the Stock, determined as of the
original Grant Dates, totals the dollar amount denoted for the specific
classification of Participant(s) which is set forth below:
Participant Classification Maximum Option Grants
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Chief Executive Officer $ 2,000,000
Class A Officers 1,000,000
Class B Executive Employees 500,000
Class C Management Employees 266,666
(e) EFFECT OF CASH DIVIDENDS AND DISTRIBUTIONS WITH RESPECT TO STOCK.
All cash dividends and distributions received with respect to Stock shall be
reinvested in additional property of the same kind (or as nearly the same kind
as feasible, if property of the same kind is not available). Any property
acquired through reinvestment will be added to the Stock which is subject to an
Option Agreement. Any Stock representing shares of an open-end regulated
investment company which are acquired through reinvestment of long-term capital
gain dividends and return of capital distributions will be added to the Stock
which is subject to an Option Agreement. Any Stock representing shares of an
open-end regulated investment company which are acquired through reinvestment of
ordinary income dividends and exempt-interest dividends will also be added to
the Stock which is subject to an Option Agreement.
3.3 EXERCISE PRICE. The Exercise Price shall be initially determined by
the Committee but shall be no less than 25 percent and no more than 100 percent
of the Fair Market Value of the Stock on the Grant Date. The Exercise Price
shall be adjusted for the following events:
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In the event of a stock dividend, stock split, reverse stock split,
rights offering, recapitalization or similar transaction that materially affects
the Market Price of the Stock, the Committee shall adjust the Exercise Price so
that it retains the same ratio to the Market Price of the Stock as existed
immediately before such transactions, or as otherwise provided in the Option
Agreement. Any Stock acquired because of one of the above events will
immediately be subject to an Option in favor of the Participant on terms
identical to those set forth in the pertinent Option Agreement.
3.4 CONDITIONS OF GRANT. As a condition to the grant of a Stock Option,
the Committee may, in its discretion, require a Participant to enter into one or
more of the following agreements with the Employer on or before the Grant Date:
(a) A covenant not to compete with the Employer, which shall become
effective on the date of Termination of Employment of the Participant with the
Employer and which shall contain such terms and conditions as may be required by
the Committee.
(b) An agreement to remain in the employ of the Employer for at least
six months after the Grant Date of an Option.
3.5 STOCK TO BE HELD IN TRUST. Upon the grant of an Option, the
Employer in accordance with the Trust Agreement, shall instruct the Trustee to
purchase the Stock underlying each Option Agreement as of the day of the Option
Agreement. The Employer shall transfer to the Trustee an amount of funds equal
to the Market Price of the Stock. Such funds shall be applied by the Trustee for
the purpose of payment for such underlying securities. In addition, if on the
date the Committee grants the Option, the principal of the Trust, and any
earnings thereon, are not sufficient to purchase such underlying securities, the
Employer may transfer to the Trustee an amount of funds sufficient to purchase
the underlying securities.
The Trustee shall establish a separate account for each Option
Agreement in which the Trustee shall hold funds to purchase securities, as well
as securities already purchased, underlying the Option Agreement. The Trustee
shall hold the securities in its own name until the Plan Participant exercises
the Option to purchase securities.
3.6 SUBSTITUTION OF ASSETS HELD IN TRUST. The Committee may, in its
discretion, after consultation with the Participant, substitute Stock of equal
Market Price for any Stock subject to purchase through the exercise of an
Option. When that substitution occurs, both parties are required to terminate
the Option Agreement and to adopt a new Option Agreement which awards an Option
of equal Market Price on the new Stock. Such change in Option property shall be
considered the grant of a new Option and the terms of this Plan, including
Articles III and IV, shall apply to the grant of the new Option, except that the
term of the new Option shall not extend beyond the term of the original Option.
The Exercise Price of the new Option shall be the same as the Exercise Price of
the original Option immediately before the substitution.
3.7 DESIGNATION OF BENEFICIARY. As soon as practicable after the grant
of an Option, the Participant shall designate one or more Beneficiaries and
successor Beneficiaries, and may change a Beneficiary designation at any time,
by filing the prescribed form with the Committee. The consent of the
Participant's current Beneficiary shall not be required for a change of
Beneficiary. No Beneficiary shall have any rights under the Plan or an Option
Agreement during the lifetime of the Participant, except as may otherwise be
provided in Section 3.9.
(a) The Beneficiary of a Participant who dies without having designated
a Beneficiary in accordance with this Section 3.7 and who is lawfully married on
the date of death shall be the Participant's surviving spouse.
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(b) The Beneficiary of any other Participant who dies without having
designated a Beneficiary in accordance with this Section 3.7 shall be the
Participant's estate.
3.8 GENERAL NON-TRANSFERABILITY. No Option granted under this Plan may
be transferred, assigned, or alienated (whether by operation of law or
otherwise), except as provided herein, and no Option shall be subject to
execution, attachment or similar process. An Option may be exercised only by the
Participant (or the Participant's Beneficiary pursuant to Section 3.7).
ARTICLE IV
OPTION EXERCISE
4.1 EXERCISE PERIOD. A Participant may exercise all or any portion of
an Option at any time during the period beginning six months after the Grant
Date and ending on the earlier of:
(a) twelve months after the Participant's date of death, and
(b) fifteen years after the Grant Date.
4.2 EXERCISE OF VESTED PORTION OF OPTION. A Participant (or the
Participant's Beneficiary pursuant to Section 3.7) may exercise the "Vested
Portion" of an Option in accordance with this Section 4.2. The terms of the
Participant's Option Agreement will determine the Vested Portion of an Option
eligible for exercise in the case of an Option granted to a Participant in the
form of an outright award or in exchange for the Participant's agreement to
relinquish rights to nonqualified deferred compensation which the Participant
does not have a current right to receive. That percentage of a Participant's
Option granted in the form of an outright award or in exchange for the
Participant's agreement to relinquish rights to nonqualified deferred
compensation which the Participant does not have a current right to receive,
which is not a Vested Portion of an Option, shall be forfeited by the
Participant upon Termination of Employment.
The Vested Portion of an Option granted in exchange for the base
compensation of a Participant is 100 percent if the Participant remains in
service with the Employer through the end of the calendar year in which the
Option is granted. If the Participant's service with the Employer is terminated
during the same calendar year in which the Grant Date occurs, he or she may
exercise the Vested Portion of the Option, which is equal to the full number of
payroll periods during which the Participant was in the service of the Employer
during the calendar year in which the Option was granted, divided by 50. That
percentage of a Participant's Option granted in exchange for the base
compensation of a Participant which is not a Vested Portion of the Option shall
be forfeited by the Participant upon Termination of Employment during the
calendar year in which the Option was granted.
The Participant shall exercise the Vested Portion of the Option by
giving written notice to the Committee and (i) tendering full payment of the
Exercise Price on or before the date of exercise, or (ii) by obtaining necessary
financing from a financial institution which is utilized to pay the Exercise
Price. The minimum number of share units allowed to be exercised at any one time
is the number of share units for which the Market Price of the Stock totals
$2,500.
In the event that the listing, registration or qualification of the
Option or the Stock on any securities exchange or under any state or federal
law, or the consent or approval of any governmental regulatory body, or the
availability of any exemption therefrom, is necessary as a condition of, or in
connection with, the exercise of the Option, then the Option shall not be
exercised in whole or in part until such listing, registration, qualification,
consent, approval, or exemption has been effected, obtained, or established to
the satisfaction of the Committee.
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4.3 DELIVERY OF STOCK. On the date of exercise, or as soon as
practicable thereafter (but in no event later than five business days after the
date of exercise), the Employer shall deliver or cause to be delivered the Stock
then being purchased to the Participant (or the Participant's Beneficiary
pursuant to Section 3.7). In the event that the listing, registration or
qualification of the Option or the Stock on any securities exchange or under any
state or federal law, or the consent or approval of any governmental regulatory
body, is necessary as a condition of, or in connection with, the exercise of the
Option, then the Option shall not be exercised in whole or in part until such
listing, registration, qualification, consent or approval has been effected or
obtained.
4.4 TAX WITHHOLDING. Whenever Stock is to be delivered upon exercise of
an Option under the Plan, the Employer shall require as a condition of such
delivery:
(a) the cash payment by the Participant of an amount sufficient to
satisfy all federal, state and local tax withholding, requirements related
thereto,
(b) the withholding of such amount from any Stock to be delivered to
the Participant,
(c) the withholding of such amount from compensation otherwise due to
the Participant, or
(d) any combination of the foregoing, at the election of the
Participant with the consent of the Employer. Such election shall be made before
the date on which the amount of tax to be withheld is determined by the
Employer, and such election shall be irrevocable.
4.5 ADDITIONAL WITHHOLDING. With the consent of the Employer, the
Participant may elect a greater amount of withholding, not to exceed the
estimated amount of the Participant's total tax liability with respect to the
delivery of Stock under the Plan. Such election shall be made at the same time
and in the same manner as provided under Section 4.4.
4.6 FAILURE TO EXERCISE. No Option shall be exercised, in whole or in
part, after the end of the Exercise Period and the Employer shall have no
obligation to deliver or cause to be delivered to the Participant (or the
Participant's Beneficiary or Assignee) the Stock subject to such Option.
ARTICLE V
AMENDMENT OR TERMINATION
5.1 PLAN AMENDMENT. The Board may, from time to time in its discretion,
amend any provision of the Plan, in whole or in part, with respect to any
Participant or group of Participants. Such amendment shall be effective as of
the date specified therein and shall be binding upon the Committee, all
Participants and Beneficiaries, and all other persons claiming an interest under
the Plan.
5.2 PLAN TERMINATION. The Plan shall terminate on the fifteenth
anniversary of the original Effective Date or such earlier date as the Board may
determine in its discretion. Such termination shall be effective as of the date
determined by the Board and shall be binding upon the Committee, all
Participants and Beneficiaries, and all other persons claiming an interest under
the Plan. Options shall continue to be exercisable after the effective date of
such termination, and may be exercised in accordance with Article IV, but no new
Options shall be granted. However, in the event of a termination of the Plan in
connection with compliance with or any addition or
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change in the Code or ERISA, federal or state securities laws, or any other law
or regulations, all Options shall be required to be exercised immediately.
5.3 AMENDMENT OF OPTIONS. An Option may be amended by the Committee at
any time if the Committee determines that an amendment is necessary or advisable
as a result of:
(a) any addition to or change in the Code or ERISA, a federal or state
securities law or any other law or regulation, which occurs after the Grant Date
and by its terms applies to the Option,
(b) any substitution of stock held in Trust pursuant to Section 3.6,
(c) any Plan amendment pursuant to Section 5.1, or Plan termination
pursuant to Section 5.2, provided that the amendment does not materially affect
the terms, conditions and restrictions applicable to the Option, or
(d) any circumstances not specified in Paragraphs (a), (b), or (c),
with the consent of the Participant.
5.4 CHANGE OF CONTROL. Notwithstanding any other provision of the Plan
or an Option Agreement, in the event of a Change of Control:
(a) the Participant shall not be required to remain in the employ of
the Employer for at least six months after the Grant Date of an Option under
Section 3.4(b),
(b) the Exercise Period under Section 4.1 shall not end prior to six
months after such Change of Control,
(c) an Option Agreement shall not be amended by the Committee under
Section 5.3 for any reason without the consent of the Participant, and
(d) an Option may be terminated by the Committee on any date after a
Change of Control, in its sole discretion and without the consent of the
Participant, if the Committee makes a cash payment to the Participant on such
date in an amount equal to the Fair Market Value of the Stock subject to such
Option, reduced by the Exercise Price, and multiplied by the number of shares
subject to such Option.
ARTICLE VI
ADMINISTRATION
6.1 THE COMMITTEE. The Plan shall be administered by a Committee
consisting of one or more persons appointed by the Board of Directors. The
Committee shall act by a majority of its members at the time in office and may
take action either by vote at a meeting or by consent in writing without a
meeting.
(a) The Board may remove any member of the Committee at any time, with
or without cause, and may fill any vacancy. If a vacancy occurs, the remaining
member or members of the Committee shall have full authority to act.
(b) Any member of the Committee may resign by written resignation
delivered to the Board. Any such resignation shall become effective upon its
receipt by the Board or on such other date as agreed to by the Board and the
resigning member.
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6.2 POWERS OF THE COMMITTEE. In carrying out its duties with respect to
the general administration of the Plan, the Committee shall have, in addition to
any other powers conferred by the Plan or by law, the following powers:
(a) to determine eligibility to receive Options;
(b) to grant Options, and to determine the form, amount and timing of
such Options;
(c) to determine the terms and provisions of the Option Agreements, and
to modify such Option Agreements as provided in Section 5.3;
(d) to substitute stock held in Trust as provided in Section 3.6;
(e) to maintain all records necessary for the administration of the
Plan;
(f) to prescribe, amend, and rescind rules for the administration of
the Plan to the extent not inconsistent with the terms thereof;
(g) to direct the Trustee respecting investment of the Trust Fund;
(h) to appoint such individuals and subcommittees as it deems desirable
for the conduct of its affairs and the administration of the Plan;
(i) to employ counsel, accountants and other consultants to aid in
exercising its powers and carrying out its duties under the Plan; and
(j) to perform any other acts necessary, and proper for the conduct of
its affairs and the administration of the Plan, except those reserved by the
Board.
6.3 DETERMINATIONS BY THE COMMITTEE. The Committee shall interpret and
construe the Plan and the Option Agreements and its interpretations and
determinations shall be conclusive and binding on all Participants,
Beneficiaries and any other persons claiming an interest under the Plan or any
Option Agreement. The Committee's interpretations and determinations under the
Plan and Option Agreements need not be uniform and may be made by it selectively
among Participants, Beneficiaries and any other persons whether or not they are
similarly situated. The failure of the Committee to strictly enforce the terms
and conditions of the Plan or the Option Agreement shall not constitute a waiver
of any provision of the Plan or the Option Agreement. No Participant may rely on
any act or statement of the Committee or anyone charged with the administration
of the Plan which is inconsistent with any of the terms and conditions of the
Plan or the Option Agreement.
6.4 INDEMNIFICATION OF THE COMMITTEE. The Employer shall indemnify and
hold harmless each member of the Committee against any and all expenses and
liabilities arising out of such member's action or failure to act in such
capacity excepting only expenses and liabilities arising out of such member's
own willful misconduct or gross negligence.
(a) Expenses and liabilities against which a member of the Committee is
indemnified hereunder shall include, without limitation, the amount of any
settlement or judgment, costs, counsel fees and related charges reasonably
incurred in connection with a claim asserted or a proceeding brought against him
or the settlement thereof, provided that the Employer shall not be liable for
any settlement to which it does not consent but such consent shall not be
unreasonably withheld.
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(b) This right of indemnification shall be in addition to any other
rights to which any member of the Committee may be entitled.
(c) The Employer may, at its own expense, settle any claim asserted or
proceeding brought against any member of the Committee when such settlement
appears to be in the best interests of the Employer, provided that such
settlement includes a complete release from liability of such member and is
otherwise reasonably acceptable to such member.
The provisions of this Section 6.4 are for the benefit of each member of the
Committee, his or her heirs, successors and assigns and as to each such member
shall survive the termination of his or her service as such. Any amendment of
this Section 6.4 shall not materially impair the rights of members and former
members of the Committee thereunder as to any period prior to such amendment.
6.5 EXPENSES OF THE COMMITTEE. The members of the Committee shall serve
without compensation for services as such. All expenses of the Committee shall
be paid by the Employer.
ARTICLE VII
TRUST PROVISIONS
7.1 ESTABLISHMENT OF THE TRUST. The Trust shall be established to hold
all Stock contributed by the Employer pursuant to Section 3.5. Except as
otherwise provided in Section 7.2, and Section 12 of the Trust Agreement, the
Trust shall be irrevocable and no portion of the Trust Fund shall be used for
any purpose other than the delivery of Stock pursuant to the exercise of an
Option, and the payment of expenses of the Plan and Trust.
7.2 TRUST STATUS. The Trust is intended to be a grantor trust, within
the meaning of Section 671 of the Code, of which the Employer is the grantor,
and this Plan is to be construed in accordance with that intention.
Notwithstanding any other provision of this Plan, the Trust Fund shall remain
the property of the Employer and shall be subject to the claims of its creditors
in the event of its bankruptcy or insolvency. No Participant shall have any
priority claim on the Trust Fund or any security interest or other right
superior to the rights of a general creditor of the Employer.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
8.1 HEADINGS. The headings of Articles, Sections and Paragraphs are
solely for convenience of reference. If there is any conflict between such
headings and the text of this Plan, the text shall control.
8.2 GENDER. Unless the context clearly requires a different meaning,
all pronouns shall refer indifferently to persons of any gender.
8.3 SINGULAR AND PLURAL. Unless the context clearly requires a
different meaning, singular terms shall also include the plural and vice versa.
8.4 GOVERNING LAW. Except to the extent preempted by federal law, the
construction and operation of the Plan shall be governed by the laws of the
State of Iowa without regard to the choice of law principles of such state.
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8.5 SEVERABILITY. If any provision of this Plan is held illegal or
invalid by any court or govemmental authority for any reason, the remaining
provisions shall remain in full force and effect and shall be construed and
enforced in accordance with the purposes of the Plan as if the illegal or
invalid provision did not exist.
8.6 NO OBLIGATION TO EXERCISE. The granting of an Option shall impose
no obligation upon a Participant to exercise such Option.
8.7 NO RIGHTS OF SHAREHOLDER. Neither the Participant or, a Beneficiary
shall be, or shall have any of the rights and privileges of, a stockholder with
respect to any Stock purchasable or issuable upon the exercise of an Option,
prior to the date of exercise of such Option.
8.8 NO RIGHT TO CONTINUED EMPLOYMENT. Nothing contained in the Plan
shall be deemed to give any person the right to be retained in the employ of the
Employer, or to interfere with the right of the Employer to discharge any person
at any time without regard to the effect that such discharge shall have upon
such person's rights or potential rights, if any, under the Plan. The provisions
of the Plan are in addition to, and not a limitation on, any rights that a
Participant may have against the Employer by reason of any employment or other
agreement with the Employer.
8.9 NOTICES. Unless otherwise specified in an Option Agreement, any
notice to be provided under the Plan to the Committee shall be mailed (by
certified mail, postage prepaid) or delivered to the Committee in care of the
Employer at its executive offices, and any notice to the Participant shall be
mailed (by certified mail, postage prepaid) or delivered to the Participant at
the current address shown on the payroll records of the Employer. No notice
shall be binding on the Committee until received by the Committee, and no notice
shall be binding on the Participant until received by the Participant.
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