Exhibit 10-D
OTTER TAIL CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
As Amended and Restated October 22, 2001
TABLE OF CONTENTS
<Table>
<Caption>
Page
Number
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1. PURPOSE 3
2. PLAN PERIODS 3
3. ADMINISTRATION 3
4. PARTICIPATION 3
5. DEFERRED COMPENSATION ACCOUNTS 4
6. PAYMENT 7
7. ASSIGNMENT 11
8. TERMINATION AND AMENDMENT 11
SCHEDULE A
SCHEDULE B
</Table>
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OTTER TAIL CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
As Amended and Restated October 22, 2001
1. PURPOSE. The Plan is designed to provide a method of deferring
payment to non-employee Directors of all or part of their retainer and/or
meeting fees, as fixed from time to time by the Board of Directors, until
termination of their services on the Board.
2. PLAN PERIODS. The first Plan Period shall commence upon the election
of Directors at the 1984 Annual Stockholders' Meeting and terminate on December
31, 1984. An additional Plan Period will commence on July 1, 2000 and continue
through December 31, 2000 for which a Director may elect to defer all or part of
his or her retainer and/or meeting fees for that period in the form of
restricted stock units, as provided in Section 5 hereof. Subsequent Plan Periods
shall relate to successive calendar years.
3. ADMINISTRATION. The Plan shall be administered by a committee of the
Board of Directors designated by the Board to administer the Plan (the
"Committee"). The Committee shall be composed solely of two or more
"Non-Employee Directors," within the meaning of Rule 16b-3 under Section 16 of
the Securities Exchange Act of 1934. The Committee shall have the power to
interpret the Plan and, subject to its provisions, to make all determinations
necessary or desirable for the Plan's administration.
4. PARTICIPATION.
(a) An individual who serves as Director and is not otherwise employed
by the Corporation or any of its subsidiaries shall be eligible to participate
in the Plan if the Director elects to have payment of his or her retainer and/or
meeting fees in respect of a Plan Period deferred as provided herein.
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(b) The election shall be made by written notice on Schedule A to the
Plan filed with the Committee prior to the first day of such Plan Period or, in
the case of a Director who first becomes eligible during a Plan Period, not
later than 30 days after the Director first becomes eligible. In the case of a
Director who first becomes eligible during a Plan Period, the election to
participate shall apply only to compensation subsequent to making the election.
Each such election shall be irrevocable. An election on Schedule A shall remain
in effect until changed or rescinded. Prior to the beginning of any subsequent
Plan Period, a Participant may irrevocably elect in writing, by completing a new
Schedule A, to change an earlier election. Such new election shall become
effective on the first business day of the Plan Period following receipt by the
Committee of the new Schedule A. Notwithstanding the foregoing, a Participant
may elect, prior to July 1, 2000, to convert all or part of his or her Deferred
Cash Account into the Deferred Stock Account, as such Accounts are described in
Section 5 below. The number of whole and fractional restricted stock units
(computed to four decimal places) shall be determined as of July 3, 2000 by
dividing the amount of the Deferred Cash Account to be converted by the average
of the high and low sale prices of a Common Share of Otter Tail Corporation as
reported on the NASDAQ National Market System on July 3, 2000.
5. DEFERRED COMPENSATION ACCOUNTS.
(a) An account shall be established for each eligible, electing
Director (a "Participant") which shall be designated as the Participant's
Deferred Compensation Account. A Participant's Deferred Compensation Account
shall include a Deferred Cash Account and/or a Deferred Stock Account. The
Deferred Cash Account means the bookkeeping account of this Plan to which a
Participant's deemed cash allocations are credited and the Deferred Stock
Account means the bookkeeping account of this Plan to which a Participant's
deemed restricted stock unit
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allocations are credited pursuant to this Plan. If a Participant elects to have
payment deferred of his or her retainer and/or meeting fees, the amount of the
retainer and/or meeting fees payable with respect to a Plan Period shall be
credited, (i) in monthly installments as of the last day of each month in the
Plan Period to which such retainer and/or meeting fees relate, for amounts
credited to the Participant's Deferred Cash Account and (ii) in quarterly
installments as of the last day of each calendar quarter in the Plan Period to
which such retainer and/or meeting fees relate, for amounts credited to the
Participant's Deferred Stock Account, subject to the provisions of Section 5(d).
The Corporation shall not be required to segregate any amounts credited to the
Deferred Compensation Accounts, which shall be established merely as an
accounting convenience. Amounts credited to the Deferred Compensation Accounts
shall at all times remain solely the property of the Corporation subject to the
claims of its general creditors and available for the Corporation's use for
whatever purpose desired.
(b) The amounts credited to a Deferred Cash Account shall, in order to
alleviate the adverse effects of an inflationary economy, accrue interest each
month at an annual rate equal to the rate charged for prime commercial loans of
90-day maturity (based on actual numbers of days, 360 days to the year), plus 1%
as of the last business day of the month. Such interest shall be computed on the
average daily balance in the Deferred Cash Account during such month and shall
be credited to such Account and compounded as of the last day of such month.
Interest shall continue to accrue and be compounded on the unpaid balance in the
Deferred Cash Account until such Account is fully distributed.
(c) The amounts credited to a Deferred Stock Account shall be credited
in the form of restricted stock units as of the last day of the calendar
quarter. The number of whole and fractional restricted stock units (computed to
four decimal places) credited to the Account shall
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be determined by dividing the amount deferred to the Deferred Stock Account
during the quarter by the average of the high and low sale prices of a Common
Share of Otter Tail Corporation as reported on the NASDAQ National Market System
on the last business day of the quarter. At such times as cash dividends are
declared by the Corporation on its outstanding Common Shares, an amount shall be
credited to the Participant's Deferred Stock Account on the record date for such
dividend equal to the amount of dividends that would be paid if the restricted
stock units (including a fractional unit) were outstanding Common Shares on such
date ("Dividend Equivalents"). At the end of the calendar quarter in which such
Dividend Equivalents are credited to the Participant's Deferred Stock Account,
the Dividend Equivalents shall be converted to additional whole and fractional
restricted stock units (computed to four decimal places) in an amount determined
by dividing the amount of the Dividend Equivalents by the average of the high
and low sale prices of a Common Share of the Corporation as reported on the
NASDAQ National Market System on the last business day of the quarter. In the
event of a stock dividend or other distribution, recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase or exchange of Common Shares or other securities of the
Corporation, issuance of warrants or other rights to purchase Common Shares or
other securities of the Corporation or other similar corporate transaction or
event that affects the Common Shares, the Committee shall make such adjustments
as it deems appropriate in the number of restricted stock units credited to a
Participant's Deferred Stock Account in order to prevent dilution or enlargement
of the Participant's benefits under the Plan.
(d) If, prior to the end of a Plan Period, a Participant becomes an
employee of the Corporation or one of its subsidiaries or dies or ceases for any
reason to be a Director, or if the
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effective date of participation by a Participant for any Plan Period shall be
other than the first day thereof, the Participant will be entitled to be
credited with that proportion of the annual retainer for the full Plan Period
which the number of days of his or her participation in the Plan during such
Plan Period bears to the total number of days in such Plan Period.
6. PAYMENT.
(a) Following termination of a Participant's service on the Board, the
Corporation shall distribute the entire amount accumulated in the Participant's
Deferred Compensation Account.
(b) By written notice on Schedule A to the Plan filed with the
Committee, a Participant may elect to have distribution of his or her Deferred
Cash Account commence either (i) within 30 days after the date the Participant
ceases to be a Director of the Corporation, (ii) 12 months after the Participant
ceases to be a Director of the Corporation, or (iii) 24 months after the
Participant ceases to be a Director of the Corporation. Any such election, or
any change in such election (by such subsequent written notice to the
Committee), shall apply only to future deferrals. In the event no election is
made as to the commencement of a distribution, such distribution shall commence
within 30 days after the date the Participant ceases to be a Director of the
Corporation. The actual date that distribution shall commence shall be a date
within the appropriate period determined by the Committee in its sole
discretion.
(c) By written notice on Schedule A to the Plan filed with the
Committee, a Participant may choose to receive the distribution of his or her
Deferred Cash Account in the form of (i) one lump-sum payment or (ii) monthly
distributions over a period selected by the Participant of up to 10 years. In
the event a lump-sum payment is made under the Plan, the amount then standing to
the Participant's credit in his or her Deferred Cash Account, including interest
at the rate provided in Section 5(b) to the date of distribution, shall be paid
to the Participant on the date
7
determined under Section 6(b). In the case of a distribution over a period of
years, the Corporation shall pay to the Participant, commencing on the date
determined under Section 6(b), monthly installments from the amount then
standing to the Participant's credit in his or her Deferred Cash Account,
including interest on the unpaid balance at the rate provided in Section 5(b) to
the date of distribution. The amount of each installment shall be determined by
dividing the then unpaid balance, plus accrued interest, in the Participant's
Deferred Cash Account by the number of installments remaining to be paid. If a
Participant does not make a choice as to the manner of distribution of his or
her Deferred Cash Account, such distribution shall be made in the form of
monthly installments paid over a five-year period. Notwithstanding the above and
subject to approval by the Committee, a Participant may at any time request, by
written notice to the Committee, to have the monthly payments scheduled to be
made to him or her within a tax year paid to him or her in one installment
within such year.
(d) Distributions from the Deferred Stock Account shall be in Common
Shares of the Corporation. The Common Shares available for issuance under this
Plan shall be issued under, and in accordance with the terms of, the Otter Tail
Corporation 1999 Stock Incentive Plan. Upon distribution, one Common Share shall
be issued for each restricted stock unit, except that no fractional shares shall
be issued, and the Participant shall receive a cash payment in lieu of any
fractional share. By written notice on Schedule A to the Plan filed with the
Committee, a Participant may elect to have a distribution of his or her Deferred
Stock Account commence (i) within 30 days after the date the Participant ceases
to be a Director of the Corporation, (ii) 12 months after the Participant ceases
to be a Director of the Corporation or (iii) 24 months after the Participant
ceases to be a Director of the Corporation. Any such election, or any change in
such election (by subsequent written notice to the Committee), shall apply only
to future deferrals. In
8
the event no election is made as to the commencement of the distribution, such
distribution shall commence within 30 days after the date the Participant ceases
to be a Director of the Corporation. The actual date that the distribution shall
commence shall be a date within the appropriate period determined by the
Committee in its sole discretion.
(e) By written notice on Schedule A to the Plan filed with the
Committee, a Participant may choose to receive the distribution of his or her
Deferred Stock Account in the form of (i) one lump-sum payment or (ii) annual
distributions over a period selected by the Participant of up to 10 years. If a
Participant does not make a choice as to the manner of distribution of his or
her Deferred Stock Account, such distribution shall be made in the form of a
lump-sum payment. In the event a lump-sum payment is made under the Plan, a
certificate representing the Common Shares payable for the whole number of
restricted stock units credited to the Participant's Deferred Stock Account
shall be delivered to the Participant or the Participant's Beneficiary, as the
case may be, along with cash in payment of any fractional share, on the date
determined under Section 6(d). In the case of a distribution over a period of
years, the Corporation shall pay to the Participant, commencing on the date
determined under Section 6(d), annual installments from the number of restricted
stock units then credited to the Participant's Deferred Stock Account, including
additional restricted stock units credited as a result of the deemed
reinvestment of Dividend Equivalents credited to the Participant's account. The
amount of each installment shall be determined by dividing the then unpaid
balance of restricted stock units by the number of installments remaining to be
paid. A certificate representing the whole number of Common Shares payable for
such installment shall be delivered to the Participant or the Participant's
Beneficiary, as the case may be, along with cash in payment of any fractional
share. The value of any fractional share shall be based upon the average of the
high and low sale prices
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of a Common Share of the Corporation as reported on the NASDAQ National Market
System on the business day preceding the payment date. The Participant or the
Participant's Beneficiary, as the case may be, shall have no rights as a holder
of Common Shares unless and until a certificate for the shares is issued by the
Corporation.
(f) In the event of a Participant's death, the balance of a
Participant's Deferred Cash Account or Deferred Stock Account, as the case may
be, shall be distributed to the Participant's Beneficiary(ies) over a period of
not more than five years or in a lump sum, in accordance with the Participant's
choice on Schedule B to the Plan filed with the Committee. Such distribution
shall commence within 30 days after the Participant's death, on a date within
such month to be determined by the Committee in its sole discretion. Additional
annual payments for distributions made over a period of more than one year shall
be made on the yearly anniversaries of such date. In the event of a
Participant's death after distribution of the Deferred Cash Account or Deferred
Stock Account, as the case may be, has commenced, any choice under this Section
6(f) shall not extend time of payment of such Account beyond the time when
distribution would have been completed if the Participant had lived. A
Participant may change Beneficiary designations by filing a subsequent Schedule
B with the Committee. If a Participant does not make a choice as to the manner
of distribution of his or her Deferred Cash Account or Deferred Stock Account,
as the case may be, in the event of death, any such distribution shall be made
as a lump-sum payment to his or her estate within 30 days after the
Participant's death.
(g) Notwithstanding any other provision of the Plan, if the Committee
shall determine in its sole discretion that the time of payment of a
Participant's Deferred Compensation Account should be advanced because of
protracted illness or other undue hardship, then the Committee may advance the
time or times of payment (whether before or after the Director's retirement
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date) only if the Committee determines that an emergency beyond the control of
the Participant exists and which would cause such Participant severe financial
hardship if the payment of such benefits were not approved. Any such
distribution for hardship shall be limited to the amount needed to meet such
emergency. A Participant who receives a hardship distribution may not reenter
the Plan for 12 months after the date of such distribution. Any distribution for
hardship under this Section 6(g) shall commence or be made within 30 days after
the Committee determines to make such hardship distribution.
7. ASSIGNMENT. No benefit under the Plan shall in any manner or to any
extent be assigned, alienated, or transferred by any Participant or Beneficiary
or subject to attachment, garnishment, or other legal process.
8. TERMINATION AND AMENDMENT. The Committee may terminate the Plan at
any time so that no further amounts shall be credited to Deferred Compensation
Accounts or may, from time to time, amend the Plan, without the consent of
Participants or Beneficiaries; provided, however, that no such amendment or
termination shall impair any rights which have accrued under the Plan.
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SCHEDULE A
IRREVOCABLE ELECTION
under the
Otter Tail Corporation
Deferred Compensation Plan for Directors
As Amended and Restated October 22, 2001
THIS IRREVOCABLE ELECTION is being made pursuant to the Otter Tail
Corporation Deferred Compensation Plan for Directors, As Amended and Restated
October 22, 2001 (the "Plan"). Any election under any Section specified below
which changes a prior election under the Plan shall apply only to subsequent
Plan Periods, as defined in the Plan. Terms used herein shall have the meanings
given to them in the Plan.
SECTION 1. DEFERRAL ELECTION.
I hereby irrevocably elect to defer receipt of all or part of my
retainer and/or meeting fees pursuant to the terms of the Plan and this
Irrevocable Election, as indicated below:
% of retainer
----------
% of meeting fees
----------
SECTION 2. FORM OF PAYMENT.
I hereby irrevocably elect to receive payment of the amounts deferred
in accordance with my election above and the terms of the Plan, in the form
indicated below:
Cash
----------
Common Shares of Otter Tail Corporation. I
---------- understand that no actual shares will be issued in
my name until I receive a distribution from the
Plan and, until such time, my Deferred Stock
Account will be credited with restricted stock
units and Dividend Equivalents, which will be
converted into additional restricted stock units,
as described in the Plan.
SECTION 3. TIMING OF DISTRIBUTION.
I hereby irrevocably elect, in accordance with the terms of the Plan,
to have the distribution from my Deferred Cash Account and/or Deferred Stock
Account to commence or be made as follows:
within 30 days after I cease to be a Director of
---------- the Corporation
12 months after I cease to be a Director of the
---------- Corporation
12
24 months after I cease to be a Director of the
---------- Corporation
I understand that if no election is made, my distribution will commence
or be made within 30 days after I cease to be a Director of the Corporation.
SECTION 4. NUMBER OF DISTRIBUTIONS FROM DEFERRED CASH ACCOUNT.
I hereby elect, in accordance with the terms of the Plan, to receive my
cash distributions from my Deferred Cash Account under the Plan, as indicated
below:
In one lump sum
----------
In monthly installments over a period of ______
---------- years (not to exceed 10 years)
I understand that if no election is made, my cash distribution will be
made in monthly installments over a period of five years.
SECTION 5. NUMBER OF DISTRIBUTIONS FROM DEFERRED STOCK ACCOUNT.
I hereby elect, in accordance with the terms of the Plan, to receive my
stock distributions from my Deferred Stock Account under the Plan, as indicated
below:
In one lump sum
----------
In annual installments over a period of ______
---------- years (not to exceed 10 years)
I understand that if no election is made, my stock distribution will be
made in one lump-sum payment.
I further understand that payment from my Deferred Stock Account will
be in the form of Common Shares of the Corporation.
SECTION 6. SIGNATURE.
I understand that the above elections are subject to the terms of the
Plan. I acknowledge receipt of a copy of the Plan. I certify that my elections
are not being made in reliance upon any financial or tax advice given by the
Corporation. I understand that I should consult my own tax advisor as to the tax
consequences of my elections.
- --------------------------------- ---------------------------------
Witness Participant's Signature
---------------------------------
Date
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SCHEDULE B
OTTER TAIL CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
As Amended and Restated October 22, 2001
SECTION 1. METHOD OF DISTRIBUTION IN CASE OF DEATH.
In case of my death, I hereby elect, in accordance with the terms of
the Plan, to have the distribution of my Deferred Compensation Account paid to
my Beneficiary(ies) designated in Section 2 hereof as indicated below:
In one lump sum
----------
In annual installments over a period of ___ years (not to
---------- exceed five years)
I understand that if no election is made, a lump-sum payment will be
made to my Beneficiary(ies) or estate within 30 days of my death. I further
understand that payments from my Deferred Stock Account, if any, will be in the
form of Common Shares of Otter Tail Corporation.
SECTION 2. DESIGNATION OF BENEFICIARY(IES).
In the event of my death, I hereby designate the following individuals,
fiduciaries or other entities, either in their own right or in their
representative capacity, in the proportions and in the priority of interest
designated, to be the beneficiaries of any benefits owing to me, under the Plan.
PRIMARY BENEFICIARIES - The following beneficiary(ies) shall receive
all benefits payable under the Plan in the event of my death in the proportions
designated hereunder. If any one or more of the primary beneficiaries designated
hereunder shall predecease me, such beneficiary's share(s) shall be divided
equally among the remaining primary beneficiaries.
<Table>
<Caption>
PROPORTIONATE
NAME AND PRESENT ADDRESS INTEREST OF PRIMARY RELATIONSHIP TO
OF PRIMARY BENEFICIARY(IES) BENEFICIARY(IES) EMPLOYEE
%
------------------------------ ----------------- -----------------
%
------------------------------ ----------------- -----------------
%
------------------------------ ----------------- -----------------
%
------------------------------ ----------------- -----------------
%
------------------------------ ----------------- -----------------
%
------------------------------ ----------------- -----------------
</Table>
- ------------------------- ------------------------------
Date Participant's Initials
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SECONDARY BENEFICIARIES - The following beneficiary(ies) shall receive
all benefits payable under the Plan in the event of my death in the proportions
designated hereunder only if all of my Primary Beneficiaries have predeceased
me. If all Primary Beneficiaries have predeceased me and if any one or more of
the Secondary Beneficiaries designated hereunder shall predecease me, such
Secondary Beneficiary's share(s) shall be divided equally among the Secondary
Beneficiaries.
<Table>
<Caption>
PROPORTIONATE
NAME AND PRESENT ADDRESS INTEREST OF
OF SECONDARY SECONDARY RELATIONSHIP
BENEFICIARY(IES) BENEFICIARY(IES) TO EMPLOYEE
%
------------------------------ ----------------- -----------------
%
------------------------------ ----------------- -----------------
</Table>
ESTATE - In the event I have declined to designate a Beneficiary
hereunder or if all of the Beneficiaries that I have designated predecease me,
then all benefits payable under the Plan shall be payable to my Estate.
- ------------------------- ------------------------------
Witness Participant's Signature
------------------------------
Date
15
OTTER TAIL CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
As Amended and Restated October 22, 2001
ONE-TIME ELECTION TO RECEIVE ANNUAL
DISTRIBUTIONS FROM DEFERRED STOCK ACCOUNT
SECTION 1. ELECTION FOR ANNUAL INSTALLMENTS.
I hereby irrevocably elect to receive my distributions from my Deferred
Stock Account in annual installments rather than in a lump-sum payment, over a
period of __ years, not to exceed 10 years, in accordance with the terms of the
Otter Tail Corporation Deferred Compensation Plan for Directors, As Amended and
Restated October 22, 2001.
I understand that this election will apply to the amount credited to my
Deferred Stock Account on December 31, 2001 and amounts credited thereafter,
provided, however, that such election to receive annual installments shall apply
only to distributions from my Deferred Stock Account that occur after January 1,
2003 (and, therefore, any distribution from my Deferred Stock Account prior to
that date shall be made in one lump-sum payment).
SECTION 2. SIGNATURE.
I understand that the above election is subject to the terms of the
Plan. I acknowledge receipt of a copy of the Plan. I certify that my election is
not being made in reliance upon any financial or tax advice given by the
Corporation. I understand that I should consult my own tax advisor as to the tax
consequences of my election.
- ------------------------- ------------------------------
Witness Participant's Signature
, 2001
----------------
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