HARVEST STATES COOPERATIVES
KEY EMPLOYEE SHARE OPTION PLAN
(Effective as of January 1, 1998)
TABLE OF CONTENTS
ARTICLE PAGE
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ARTICLE I
Purpose 1
ARTICLE II
Definitions and Construction 1
ARTICLE III
Option Grant 3
ARTICLE IV
Option Exercise 7
ARTICLE V
Amendment or Termination 9
ARTICLE VI
Administration 10
ARTICLE VII
Trust Provisions 12
ARTICLE VIII
Miscellaneous Provisions 12
HARVEST STATES COOPERATIVES
KEY EMPLOYEE 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, and encourage the recipients to continue in the employment of the
Employer.
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" means any change in (a) the ownership of the
Employer, (b) the effective control of the Employer, as defined under section
280G of the Code, or (c) the ownership of a substantial portion of the assets of
the Employer, as defined under section 280G of the Code, except as otherwise
provided by written agreement executed by the Employer and a Participant prior
to such Change of Control.
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 Harvest States Key Employee Share Option Plan
Committee appointed in accordance with Section 6.1.
2.6 "EFFECTIVE DATE" means January 1, 1998.
2.7 "EMPLOYEE" means any individual who is employed by the Employer.
2.8 "EMPLOYER" means Harvest States Cooperatives, and any successor
thereto, and any affiliated entity that is related to the Employer pursuant to
the rules under Code sections 414(b), (c), or (d) and the regulations
thereunder, which adopts the Plan as a participating Employer.
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 or under an Option Agreement
signed by the Participant and the Committee.
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 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 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 executed by the Employer and a
Participant to whom options have been awarded acknowledging the issuance of the
options and setting forth any terms pursuant to Section 3.2.
2.17 "PARTICIPANT" means any individual who meets the eligibility
requirements of Section 3.1, who has received an award of Options in accordance
with Section 3.2, and whose Options have been completely exercised or lapsed.
After a Participant's death, his Beneficiary is considered to be a Participant
to the extent necessary to facilitate the exercise of any Options that continue
to be exercisable under the terms of the Plan. In the event of a Participant's
disability or other legal incapacity, the Participant's legal representative is
considered to be a Participant to the extent necessary to facilitate the
exercise of any Options that are or become exercisable under the terms of the
Plan. If a Participant has assigned his Options under Section 3.8 then the
Participant's assignee is considered a Participant able to exercise Options
under the terms of the Plan.
2.18 "PLAN" means the Harvest States Cooperatives Key Employee 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 or shares of a regulated investment
company designated by the Committee as subject to purchase through the exercise
of an Option.
2.20 "TERMINATION OF EMPLOYMENT" means an Employee's separation from the
service with the Employer (including all affiliates of the Employer) by reason
of resignation, discharge, death, disability, or other termination of
relationship. 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 an Employee selected by the
Committee from the executive officers and other key employees of the Employer
who occupy senior management or professional positions and whom the Committee
determines to have the capability of making a substantial contribution to the
success of the Employer. In making this selection and in determining the form
and amount of Options, the Committee 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
success and growth. Participation shall commence on the next January 1 following
a current Employee's selection by the Committee or on the next July 1 following
the selection of a new Employee hired by the Employer after January 1.
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 requested reduction in the 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 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 base compensation which a Participant may exchange for an Option
during
a calendar year shall not exceed 30 percent. An option granted in exchange for a
reduction in the compensation or bonus of the Participant shall be granted on or
about August 31 of each year to Participants who are employed by the Employer
and shall reflect the requested reduction in the base compensation of the
Participant for the entire calendar year and the requested bonus or incentive
compensation reduction determined with respect to the preceding fiscal year of
the Employer ending May 31.
In the event that a Participant's employment with the Employer terminates prior
to the grant of his or her Option on or about August 31, an amount of
compensation equivalent to the reduction in compensation or bonus shall be paid
to the Participant by the Employer upon his or her Termination of Employment.
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.
(a) IN GENERAL. The minimum total Market Price of the Stock underlying
an Option Agreement executed during any calendar year is $2,500.00. Any terms
not specified in the Plan shall be specified in the Option Agreement. No
Committee member may take part in any way in determining the amount of any award
of Options to himself or herself.
(b) EFFECT OF DIVIDENDS AND DISTRIBUTIONS WITH RESPECT TO STOCK. The
Employer agrees to reinvest all dividends and distributions received with
respect to Stock 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 by rounding to the
nearest one thousandth of a share and will be subject to the applicable Option,
without any adjustment to the Exercise Price.
3.3 EXERCISE PRICE. The Exercise Price shall be initially determined by
the Committee and shall be noted on the individual Option Agreement signed by
the eligible Participant and the Committee. The Committee has determined that
the initial Exercise Price shall equal 25 percent of the Market Price of the
Stock on the Grant Date. The Exercise Price shall subsequently be adjusted as
otherwise provided in the Option Agreement or for the following events:
In the event of a stock dividend, stock split, reverse stock split,
rights offering, return of capital distribution, recapitilization 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
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 an
agreement on or before the Grant Date 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 securities underlying each Option Agreement as of the dare of the
Option Agreement. The Employer shall transfer to the Trustee an amount of funds
equal to the amount of reduced base compensation, award or bonus being exchanged
by the Plan Participant for the Option. 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 shall 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.
The Stock shall not be subject to any security interest, whether or not
perfected, or to any option or contract under which any other person may acquire
any interest in it, except as otherwise provided in the Trust Agreement.
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 such substitution occurs, both parties are required to terminate
the Option Agreement and to adopt a new Option Agreement which awards Options 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 the Plan, including
Articles III and IV, shall apply to the grant of the new Option except that the
Exercise Period under the new Option Agreement shall not exceed the Exercise
Period under the original Option Agreement.
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 or approval has been affected or obtained.
3.7 DESIGNATION OF BENEFICIARY. As soon as practicle after the grant of
an Option, the Participant shall designate one or more Benefeciareis and
successor Benefirciares, and may change them ar any time, by filling 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.
(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.
(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).
3.9 PERMITTED TRANSFERS. Notwithstanding the provisions of Section 3.8,
a Participant may at any time prior to death, assign all or any portion of an
Option to:
(a) the Participant's spouse or lineal descendants,
(b) the trustee of a trust for the primary benefit of the
Participant's spouse or lineal descendants, or
(c) a partnership of which the participant's spouse and lineal
descendants are the only partners.
Any such assignment shall be permitted only if an assignment
is expressly permitted in the Option Agreement, or approved in writing by the
Committee, and the Participant receives no consideration for the assignment. Any
such assignment shall be evidenced by an appropriate written document executed
by the Participant, and delivered to the Committee on or before the effective
date of the assignment. In the event of such assignment, the spouse, lineal
descendent, trustee, or partnership shall be entitled to all of the rights of
the Participant with respect to the assigned portion of the Option, and such
portion of the Option, shall continue to be subject to all of the terms,
conditions and restrictions applicable to the Option, as set forth in the Plan
and the Option Agreement.
ARTICLE IV
OPTION EXERCISE
4.1 EXERCISE PERIOD. A Participant (or the Participant's Beneficiary
pursuant to Section 3.7) may exercise the adjusted portion of an Option as
determined under Section 4.2 at any time during the period beginning six months
after the Grant Date and ending on the earliest of the following:
(a) 90 days after the Participant's Termination of Employment,
if such Participant is terminated involuntarily for cause, as
determined by the Committee based upon the records of the Employer;
(b) 120 months after the Participant's Termination of
Employment, if such Participant's employment terminates for any other reason not
set forth in Paragraph (a); or
(c) 20 years after the Grant Date.
If a Participant or his Beneficiary fails to exercise an Option within the
Exercise Period then the Stock becomes the permanent property of the Employer
with the Participant or his Beneficiary or
assignee losing any right to any Option or Stock that was not exercised within
the eligible Exercise Period pursuant to Section 4.1. Notwithstanding the
foregoing, at no time shall the Exercise Period be less than six months from the
Grant Date.
4.2 EXERCISE OF ADJUSTED PORTION OF OPTION. A Participant (or the
Participant's Beneficiary pursuant to Section 3.7) may exercise 100 percent of
his or her Options granted in exchange for a reduction in the base compensation
of a Participant if the Participant remains employed with the Employer through
the end of the calendar year in which the Option is granted, provided the Option
is held for at least six months. If the Participant experiences a Termination of
Employment with the Employer before the end of that calendar year, he or she may
exercise the "Adjusted Portion" of the Option shares or units granted in the
calendar year in which the employment terminates. For purposes of this Plan,
"Adjusted Portion" shall be determined as follows, based upon the date of the
Participant's commencement of participation in the Plan:
(a) PARTICIPATION COMMENCING ON JANUARY 1. The Adjusted Portion of an
Option granted to such Participant who commenced participation in the
Plan on January 1 shall be equal to the full number of payroll periods
during which the Participant was employed with the Employer during the
calendar year in which the Option was granted, divided by 24.
(b) PARTICIPATION COMMENCING ON JULY 1. The Adjusted Portion of an
Option granted to such Participant who commenced participation in the
Plan on July 1 shall be equal to the full number of payroll periods
during which the Participant was employed with the Employer following
commencement of participation in the Plan during the calendar year in
which the Option was granted, divided by 12.
The Participant shall exercise the Adjusted Portion of the Option by
giving written notice to the Committee and tendering full payment of the
Exercise Price by bank-certified or cashiers check on or before the date of
exercise. That percentage of a Participant's Option granted in exchange for a
reduction in the base compensation of a Participant which is not an Adjusted
Portion of an Option shall be forfeited by the Participant upon Termination of
Employment during the calendar year in which the Option was granted. The terms
of the Participant's Option Agreement will determine the percentage 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 a reduction in the bonus of a
Participant. The minimum portion of an Option allowed to be exercised at any one
time is the number of shares of Stock for which the Market Price of such Stock
totals $5,000.
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 affected, obtained, or established to
the satisfaction of the Committee.
4.3 DELIVERY OF STOCK. On the date of exercise, or as soon as
practicable thereafter (but in no event later than fifteen 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).
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, or
(c) a 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) 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 twentieth
anniversary of the 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 change in the Code or ERISA,
federal or state securities laws, or any other law or regulation, all Options
shall be required to be exercised immediately.
5.3 AMENDMENT OF OPTION. An Option Agreement may be amended by the
Committee at any time if the Committee determines that an amendment is necessary
or advisable in connection with
(a) compliance with or any addition to or change in the Code or
ERISA, federal or state securities laws, or any other law or
regulation,
(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 and adversely 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) the Exercise Period under Section 4.1(b) 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 other than pursuant to subparagraph
(a) thereof without the consent of the Participant, and
(d) an Option Agreement 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 Market Price of
the Stock underlying such Option Agreement reduced by the Exercise
Price, multiplied by the number of shares underlying such Option
Agreement, and further reduced by all applicable tax withholding
required by Section 4.4.
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.
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 participate in the Plan and
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 appoint such individuals and subcommittees as it deems
desirable for the conduct of its affairs and the administration of the
Plan;
(h) to employ counsel, accountants and other consultants to aid
in exercising its powers and carrying out its duties under the Plan;
and
(i) 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 the 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.
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.
(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 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 reasonable 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 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 Minnesota without regard to the choice of law principles of such state.
8.5 SEVERABILITY. If any provision of this Plan is held illegal or
invalid by any court or governmental 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, nor 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.