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EXHIBIT 10.g
SUBJECT: LONG TERM INCENTIVE PLAN (Completely Revised)
POLICY
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CERTAIN OFFICERS AND HUFFY COMPANY PRESIDENTS SHALL PARTICIPATE IN A LONG TERM
INCENTIVE PLAN OF COMPENSATION. THE PURPOSE OF THE LONG TERM INCENTIVE PLAN
SHALL BE TO PROVIDE AN INCENTIVE FOR LONG TERM PERFORMANCE AND BE COMPETITIVE
WITH THE MARKETPLACE.
Award as a % of
Base Salary on January 1
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I. Participants Target Maximum
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A. Chairman, President and Chief Executive 50% 100%
Officer
B. Vice President-General Counsel & 25% 50%
Secretary
Vice President-Finance and
Chief Financial Officer
Vice President and Controller
Vice President-Human Resources and
Organization Development
President & General Manager - HBC
President & General Manager - HSC
President & General Manager - HSF
President & General Manager - WIS
President & General Manager - TTH
II. Measurement
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Based on performance of measures weighted as follows:
Corporate Officers Huffy Company Presidents
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1. Corporate RONA - 33 1/3% 1. Huffy Company RONA - 50%
2. EPS - 33 1/3% 2. Corporate EPS - 25%
3. TSR - 33 1/3% 3. Corporate TSR - 25%
A. Award Cycle
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The award cycle shall be rolling three year performance periods.
B. Salary Basis
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Awards under this plan are to be based upon the participant's
actual base salary as of January 1 of each new award cycle.
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Part No. TS 136 Page 1 of 4
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SUBJECT: LONG TERM INCENTIVE PLAN (Completely Revised)
EXCEPTIONS: In order to transition from the prior long term
incentive plan to this new long term incentive plan the first
three performance periods and the percent of target award each
participant shall be eligible for will be as follows:
% of Target Award Participant
Performance Period is Eligible for
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1. 01/01/98 to 12/31/98 33 1/3%
2. 01/01/98 to 12/31/99 66 2/3%
3. 01/01/98 to 12/31/00 100 %
C. Definitions
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Corporate RONA: Consolidated RONA as defined in Policy number 128.
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Huffy Company RONA: As defined in Policy number 128.
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EPS: Earnings per common share
TSR: Total Shareholder Return being (i) the annual average rate
of growth calculated as:
(Stock Price(EOY) + Dividends Declared) - Stock Price BOY = Rate
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Stock Price (BOY)
(ii) adding such Rate increases and/or decreases for each
calendar year in the LTIP cycle and (iii) dividing the
result by the number of calendar years in the LTIP cycle.
STOCK PRICE(BOY): Beginning of your stock price means the arithmetic
average of the closing price of Huffy Common
Stock on each Friday during the calendar quarter
immediately preceding January 1 of the next
calendar year.
STOCK PRICE(EOY): End of year stock price means the arithmetic
average of the closing price of Huffy common
stock on each Friday during the final calendar
quarter of the year.
D. GOALS: Goals for each measure shall be the goals in the final year
of the performance period approved by the Compensation
Committee of the Board of Directors. (Note: TSR results for
any performance period shall be calculated as defined in the
preceding sections).
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Part No. TS 136 Page 2 of 4
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SUBJECT: LONG TERM INCENTIVE PLAN (Completely Revised)
E. Award Scales(1)
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Actual Huffy/Corporate % of Award
Results versus Goal Earned
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Less than 90% 0%
90% Threshold 50%
95% 75%
100% Target 100%
105% 133 1/3%
110% 166 2/3%
115% Maximum 200%
<FN>
1 Scale is linear between points and shall be interpolated to the nearest
1/10th of 1% to determine award level.
III. Payment forms and Manner
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100% of the award earned under each award cycle shall be paid in cash as
soon as practicable following completion of an award cycle subject to
approval by the Compensation Committee of the Board of Directors of such
payments.
IV. Implementation
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Individuals in an eligible position as of the first business day of the
calendar year will be eligible for 100% of the award cycle in such year
and a pro-rated portion of other award cycles currently in process.
Generally, individuals newly hired or newly promoted to an eligible
position after the first business day of the year will be eligible for a
pro-rated award for the award cycle commencing in the year of hire or
promotion and other award cycles currently in process based on the number
of full calendar quarters remaining in the award cycles. However, no
individual who becomes an eligible participant after June 30 will be
eligible for any award for the award cycle ending the year of hire or
promotion.
Current participants who are transferred or promoted to another position
will be eligible for pro-rated awards based on the number of full and
partial quarters worked in the old and new position for award cycles in
progress. However, transfers and promotions occurring after June 30 for an
award cycle ending in the year of transfer or promotion will be treated as
having worked in the old position for 100% of that award cycle.
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SUBJECT: LONG TERM INCENTIVE PLAN (Completely Revised)
Employees who are demoted to a non-eligible position for any reason other
than health will not be eligible for payment of any award for any award
cycle. If an employee is demoted to a non-eligible position due to health
reasons, and if deemed acceptable to the Chief Executive Officer in his
sole discretion, the employee will be eligible for a pro-rated award based
on the number of full calendar quarters during which the employee was in
an eligible position. However, no award will be earned for an award cycle
in which the employee was not an eligible participant for at least two
full calendar quarters.
Employees who terminate employment by reason of disability (as deemed
disabled by the Corporation's long-term disability insurance carrier),
early or normal retirement or by death shall be eligible for a pro-rated
award based on the number of full calendar years completed for any award
cycle.
Payments will be made to the estate of deceased participants.
V. Distribution
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Distribution shall be limited to Corporate Officers, Huffy Company
President and the Director of Corporate Human Resources.
/s/ Stanley H. Davis /s/ Don R. Graber
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Vice President - Human Resources and Chairman, President and
Organization Development Chief Executive Officer
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Part No. TS 136 Page 4 of 4