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EXHIBIT 10.21
BOISE CASCADE, L.L.C.
[FORM OF BOISE INCENTIVE AND PERFORMANCE PLAN]
Effective January 1, 2005
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[FORM OF BOISE INCENTIVE AND PERFORMANCE PLAN]
1. PURPOSE AND ESTABLISHMENT.
1.1. PURPOSE. The Boise Incentive and Performance Plan (the "Plan") is
intended to promote the interests of the Company and its shareholders by (a)
attracting, motivating, rewarding, and retaining the broad-based management
talent critical to achieving the Company's business goals; (b) linking a portion
of each Participant's compensation to the performance of both the Company and
the individual Participant; and (c) encouraging ownership of Stock (defined
below) by Participants. The Plan has been adopted and approved by the Board of
Managers (defined below).
2. DEFINITIONS. As used in the Plan, the following definitions apply to the
terms indicated below:
2.1 "Agreement" means either the written agreement between the Company
and a Participant evidencing an Award and setting forth the terms and conditions
applicable to the Award or a statement issued by the Company to a Participant
describing the terms and conditions of an Award.
2.2 "Annual Incentive Award" means an Award granted under Section 13.
2.3 "Award" means any Option, Stock Appreciation Right, Restricted
Stock, Restricted Stock Unit, Performance Unit, Performance Share, Annual
Incentive Award, or Stock Bonus granted pursuant to the terms of the Plan.
2.4 "Board of Managers" means the Board of Managers of Parent.
2.5 A "Change in Control" shall be deemed to have occurred if, after the
initial public offering of Stock in 2005 has been completed:
(a) Any Person is or becomes the Beneficial Owner, directly or
indirectly, of securities of Parent representing 35% or more of either the then
outstanding shares of common stock of Parent or the combined voting power of
Parent's then outstanding securities; provided, however, if such Person acquires
securities directly from Parent, such securities shall not be included unless
such Person acquires additional securities which, when added to the securities
acquired directly from Parent, exceed 35% of Parent's then outstanding shares of
common stock or the combined voting power of Parent's then outstanding
securities, and provided further that any acquisition of securities by any
Person in connection with a transaction described in Section 2.5(c)(i) shall not
be deemed to be a Change in Control; or
(b) The following individuals cease for any reason to constitute at
least a majority of the number of directors then serving: individuals who, on
the date
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hereof, constitute the Board and any new director (other than a director whose
initial assumption of office is in connection with an actual or threatened
election contest, including but not limited to a consent solicitation, relating
to the election of directors of Parent) whose appointment or election by the
Board or nomination for election by Parent's stockholders was approved by a vote
of at least 2/3rds of the directors then still in office who either were
directors on the date hereof or whose appointment, election, or nomination for
election was previously so approved (the "Continuing Directors"); or
(c) The consummation of a merger or consolidation of Parent (or any
direct or indirect subsidiary of Parent) with any other corporation other than
(i) a merger or consolidation which would result in both (a) Continuing
Directors continuing to constitute at least a majority of the number of
directors of the combined entity immediately following consummation of such
merger or consolidation, and (b) the voting securities of Parent outstanding
immediately prior to such merger or consolidation continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity or any parent thereof) more than 50% of the combined voting
power of the voting securities of Parent or such surviving entity or any parent
thereof outstanding immediately after such merger or consolidation, or (ii) a
merger or consolidation effected to implement a recapitalization of the Company
(or similar transaction) in which no Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of Parent representing 35% or more of
either the then outstanding shares of common stock of Parent or the combined
voting power of Parent's then outstanding securities; provided that securities
acquired directly from Parent shall not be included unless the Person acquires
additional securities which, when added to the securities acquired directly from
Parent, exceed 35% of Parent's then outstanding shares of common stock or the
combined voting power of Parent's then outstanding securities; and provided
further that any acquisition of securities by any Person in connection with a
transaction described in Section 2.5(c)(i) shall not be deemed to be a Change in
Control; or
(d) The stockholders of Parent approve a plan of complete
liquidation or dissolution of Parent or the consummation of an agreement for the
sale or disposition by Parent of all or substantially all of Parent's assets,
other than a sale or disposition by Parent of all or substantially all of
Parent's assets to an entity, more than 50% of the combined voting power of the
voting securities of which are owned by Persons in substantially the same
proportions as their ownership of Parent immediately prior to such sale.
A transaction described in Section 2.5(c) which is not a Change in
Control solely due to the operation of Subsection 2.5(c)(i)(a) will nevertheless
constitute a Change in Control if the Board determines, prior to the
consummation of the transaction, that there is not a reasonable assurance that,
for at least two years following the consummation of the transaction, at least a
majority of the members of the board of directors of the surviving entity or any
parent will continue to consist of Continuing Directors and individuals whose
election or nomination for election by the shareholders of the surviving entity
or any parent would be approved by a vote of at
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least two-thirds of the Continuing Directors and individuals whose election or
nomination for election has previously been so approved.
For purposes of this Section 2.5, "Beneficial Owner" shall have the
meaning set forth in Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and "Person" shall have the meaning given in
Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and
14(d) thereof, except that "Person" shall not include (i) Parent or any of its
subsidiaries, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of Parent or any of its subsidiaries, (iii) an underwriter
temporarily holding securities pursuant to an offering of such securities, (iv)
a corporation owned, directly or indirectly, by the stockholders of Parent in
substantially the same proportions as their ownership of stock of Parent, or (v)
an individual, entity or group that is permitted to and does report its
beneficial ownership of securities of Parent on Schedule 13G under the Exchange
Act (or any successor schedule), provided that if the individual, entity or
group later becomes required to or does report its ownership of Parent's
securities on Schedule 13D under the Exchange Act (or any successor schedule),
then the individual, person or group shall be deemed to be a Person as of the
first date on which the individual, person or group becomes required to or does
report its ownership on Schedule 13D.
2.6 "Code" means the Internal Revenue Code of 1986, as amended from time
to time, and any regulations promulgated thereunder.
2.7 "Committee" means the Executive Compensation
Committee of the Board of Managers or any successor to the Committee, which
shall consist of three or more persons, each of whom, unless otherwise
determined by the Board of Managers, is an "outside director" within the meaning
of Section 162(m) of the Code and a "nonemployee director" within the meaning of
Rule 16b-3.
2.8 "Company" means Boise Cascade, L.L.C., a Delaware limited liability
company.
2.9 "Director" means any individual who is a member of the Board of
Managers and who is not an employee of the Company.
2.10 "Disciplinary Reason" has the meaning ascribed to that term in the
Company's Corporate Policy 10.2, Termination of Employment.
2.11 "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
2.12 "Fair Market Value" of a share of Stock means the closing price of
the Stock as reported by the consolidated tape of the New York Stock Exchange on
the date in question, unless otherwise specified by the Committee. If there are
no Stock transactions on a particular date, the Fair Market Value shall be
determined as of the immediately preceding date on which there were Stock
transactions.
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The Committee may in its sole discretion specify a different date or
dates on which Fair Market Value will be determined or may specify a price that
is at or within the range of the high and low selling prices of the Stock on the
New York Stock Exchange, that is the actual selling price, or that is an average
of prices over a number of trading days for the purpose of calculating Fair
Market Value; provided that the Fair Market Value specified for Incentive Stock
Options shall comply with applicable laws and regulations.
2.13 "Incentive Stock Option" means an Option that is an "incentive
stock option" within the meaning of Section 422 of the Code, or any successor
provision, and that is designated by the Committee as an Incentive Stock Option.
2.14 "Nonqualified Stock Option" means an Option other than an Incentive
Stock Option.
2.15 "Option" means the right to purchase a stated number of shares of
Stock at a stated price for a stated period of time, granted pursuant to Section
7.
2.16 "Parent" means Boise Cascade Holdings, L.L.C.
2.17 "Participant" means an employee of the Company or a subsidiary or
a Director to whom an Award is granted pursuant to the Plan, or upon the death
of the Participant, his or her successors, heirs, executors, and administrators,
as the case may be.
2.18 "Performance Goals" means the objectives established by the
Committee in its sole discretion with respect to any performance-based Awards
that relate to one or more business criteria within the meaning of Section
162(m) of the Code. Performance Goals may include or be based upon, without
limitation: sales; gross revenue; gross margins; internal rate of return; cost;
ratio of debt to debt plus equity; profit before tax; earnings before interest
and taxes; earnings before interest, taxes, depreciation, and amortization;
earnings per share; operating earnings; economic value added; ratio of operating
earnings to capital spending; cash flow; free cash flow; net operating profit;
net income; net earnings; net sales or net sales growth; price of Stock; return
on capital, net assets, equity, or shareholders' equity; segment income; market
share; productivity ratios; expense targets; working capital targets; or total
return to shareholders. Performance Goals may (a) be used to measure the
performance of Parent or the Company as a whole or any subsidiary, business unit
or segment of Parent or the Company, (b) include or exclude (or be adjusted to
include or exclude) extraordinary items, and/or (c) reflect absolute entity
performance or a relative comparison of entity performance to the performance of
a peer group, index, or other external measure, in each case as determined by
the Committee in its sole discretion.
2.19 "Performance Share" means an Award of a number of shares granted
to a Participant pursuant to Section 12 which is initially valued according to
Fair
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Market Value and is paid out based on the achievement of stated Performance
Goals during a stated period of time.
2.20 "Performance Unit" means an Award granted to a Participant
pursuant to Section 11 which is paid out based on the achievement of stated
Performance Goals during a stated period of time.
2.21 "Restricted Stock" means Stock granted to a Participant which is
subject to forfeiture and restrictions as set forth in Section 9.
2.22 "Restricted Stock Units" means an Award granted to a Participant
pursuant to Section 10 which is subject to forfeiture and restrictions.
2.23 "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act,
as amended from time to time.
2.24 "Securities Act" means the Securities Act of 1933, as amended from
time to time.
2.25 "Stock" means the common stock of Parent.
2.26 "Stock Appreciation Right" or "SAR" means the right to receive an
amount calculated as provided in and granted pursuant to Section 8.
2.27 "Stock Bonus" means a bonus payable in shares of Stock granted
pursuant to Section 14.
3. STOCK SUBJECT TO THE PLAN.
3.1 SHARES AVAILABLE FOR AWARDS. The maximum number of shares of Stock
reserved for issuance under the Plan shall be shares (subject to
adjustment as provided herein). Shares may be authorized but unissued Stock
or authorized and issued Stock held in Parent's treasury. All shares of Stock
reserved for issuance under the Plan shall be available for any Awards,
including Options and Stock Appreciation Rights. The following shares of
Stock shall again be available for Awards under the Plan: (a) shares subject
to an Award which is cancelled, expired, terminated, forfeited, surrendered,
or otherwise settled without the issuance of any Stock, (b) shares of
Restricted Stock that are forfeited, (c) shares of Stock tendered to satisfy
the exercise price of an Option, and (d) shares tendered or withheld to
satisfy tax withholding pursuant to Section 18.
3.2 PERFORMANCE-BASED AWARD LIMITATION. Awards that are designed to
comply with the performance-based exception from the tax deductibility
limitation of Section 162(m) of the Code shall be subject to the following
rules:
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(a) The number of shares of Stock that may be granted in the form of
Options in a single fiscal year to a Participant may not exceed .
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(b) The number of shares of Stock that may be granted in the form of
SARs in a single fiscal year to a Participant may not exceed .
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(c) The number of shares of stock that may be granted in the form of
Restricted Stock in a single fiscal year to a Participant may not exceed
.
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(d) The number of Restricted Stock Units that may be granted in a
single fiscal year to a Participant may not exceed .
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(e) The number of shares of Stock that may be granted in the form
of Performance Shares in a single fiscal year to a Participant may not exceed
.
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(f) The maximum amount that may be paid to a Participant for
Performance Units granted in a single fiscal year to the Participant may not
exceed $ .
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3.3 ADJUSTMENT FOR CHANGE IN CAPITALIZATION. In the event of any
recapitalization, stock split, reverse stock split, reorganization, merger,
consolidation, spin-off, combination, share repurchase, share exchange,
reclassification, or other similar corporate transaction or event, unless
otherwise determined by the Committee in its sole discretion, (a) the number and
kind of shares of stock which may thereafter be issued in connection with
Awards; (b) the number and kind of shares of stock or other property issued or
issuable in respect of outstanding Awards; (c) the exercise price, grant price,
or purchase price relating to any Award; and (d) the maximum number of shares
subject to Awards which may be awarded to any employee during any fiscal year of
the Company shall be equitably adjusted as necessary to prevent the dilution or
enlargement of the rights of Participants; provided that, with respect to
Incentive Stock Options, adjustments shall be made in accordance with Section
424 of the Code.
4. ADMINISTRATION OF THE PLAN.
4.1 AUTHORITY AND DELEGATION. The Committee shall have final
discretion, responsibility, and authority to administer and interpret the Plan.
This includes the discretion and authority to determine all questions of fact,
eligibility, or benefits relating to the Plan. The Committee may also adopt any
rules it deems necessary to administer the Plan. Any interpretation,
determination, decision, or other action made or taken by the Committee shall be
final and binding on Participants. The Committee's responsibilities for
administration and interpretation of the Plan shall be exercised by Company
employees who have been assigned those responsibilities by the Company's
management. Any Company employee exercising responsibilities relating to the
Plan in accordance with this section shall be deemed to have been
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delegated the discretionary authority vested in the Committee with respect to
those responsibilities, unless limited in writing by the Committee.
4.2 TERMS AND CONDITIONS OF AWARDS. The Committee shall have final
discretion, responsibility, and authority to:
(a) grant Awards;
(b) determine the Participants to whom and the times at which
Awards shall be granted;
(c) determine the type and number of Awards to be granted, the
number of shares of Stock to which an Award may relate, and the applicable
terms, conditions, and restrictions, including the length of time for which any
restriction shall remain in effect;
(d) establish and administer Performance Goals relating to any
Award;
(e) establish the rights of Participants with respect to an Award
upon termination of employment or termination of service as a Director (which
may be different based on the reason for termination);
(f) determine whether, to what extent, and under what circumstances
an Award may be settled, cancelled, forfeited, exchanged, or surrendered,
provided that any Committee action taken in this respect must not result in an
Award being considered "nonqualified deferred compensation" under Section 409A
of the Code;
(g) make adjustments in the Performance Goals in recognition of
unusual or nonrecurring events affecting Parent or the Company or the financial
statements of Parent or the Company, or in response to changes in applicable
laws, regulations, or accounting principles;
(h) determine the terms and provisions of Agreements; and
(i) make all other determinations deemed necessary or advisable for
the administration of the Plan.
The Committee may solicit recommendations from Parent's or the Company's
management with respect to any or all of the items listed above.
The Committee shall determine the terms and conditions of each
Award at the time of grant. The Committee may establish different terms and
conditions for different Participants, for different Awards, and for the same
Participant for each Award the Participant may receive, whether or not granted
at different times.
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5. ELIGIBILITY. The persons who shall be eligible to receive Awards
pursuant to the Plan shall be employees of the Company and its subsidiaries and
affiliates (including elected officers of the Company, whether or not they are
directors of Parent) selected by the Committee from time to time, and Directors.
The grant of an Award at any time to any person shall not entitle that person to
a grant of an Award at any future time.
6. AWARDS UNDER THE PLAN; AGREEMENT. Awards that may be granted under the
Plan consist of Options, Stock Appreciation Rights, Restricted Stock, Restricted
Stock Units, Performance Units, Performance Shares, Annual Incentive Awards, and
Stock Bonuses, all as described below.
Each Award granted under the Plan, except unconditional Stock
Bonuses, shall be evidenced by an Agreement which shall contain such provisions
as the Committee may, in its sole discretion, deem necessary or desirable which
are not in conflict with the terms of the Plan. By accepting an Award, a
Participant agrees that the Award shall be subject to all of the terms and
provisions of the Plan and the applicable Agreement.
7. OPTIONS.
7.1 TERMS AND AGREEMENT. Subject to the terms of the Plan, Options
may be granted to Participants at any time as determined by the Committee. The
Committee shall determine, and the Agreement shall reflect, the following for
each Option granted:
(a) the number of shares subject to each Option;
(b) duration of the Option (provided that no Option shall have
an expiration date later than the day after the 10th anniversary of the date of
grant);
(c) vesting requirements, if any;
(d) whether the Option is an Incentive Stock Option or a
Nonqualified Stock Option;
(e) the amount and duration of related Stock Appreciation Rights, if
any, and any conditions upon their exercise;
(f) the exercise price for each Option (which shall not be less
than the Fair Market Value on the date of the grant);
(g) the permissible method(s) of payment of the exercise price;
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(h) the rights of the Participant upon termination of employment
or service as a Director (which may be different based on the reason for
termination), provided that the termination rights for Participants receiving
Incentive Stock Options shall conform to Section 422 of the Code; and
(i) any other terms or conditions established by the Committee.
7.2 EXERCISE OF OPTIONS.
(a) Options shall be exercisable at such times and subject to such
restrictions and conditions as the Committee, in its sole discretion, deems
appropriate, which need not be the same for all Participants.
(b) An Option shall be exercised by delivering written notice as
specified in the Agreement on the form of notice provided by Parent. Options may
be exercised in whole or in part.
For a Participant who is subject to Section 16 of the Exchange Act,
Parent may require that the method of payment comply with Section 16 and the
rules and regulations thereunder. Any payment in shares of Stock, if permitted,
shall be made by delivering the shares to the corporate secretary of Parent,
duly endorsed in blank or accompanied by stock powers duly executed in blank,
together with any other documents and evidence as the secretary shall require.
(c) Certificates for shares of Stock purchased upon the exercise of
an Option shall be issued in the name of or for the account of the Participant
or other person entitled to receive the shares and delivered to the Participant
or other person as soon as practicable following the effective date on which the
Option is exercised.
7.3 INCENTIVE STOCK OPTIONS. Notwithstanding anything in the Plan to
the contrary, no term of the Plan relating to Incentive Stock Options shall be
interpreted, amended, or altered, nor shall any discretion or authority granted
under the Plan be exercised so as to disqualify the Plan under Section 422 of
the Code, or, without the consent of any affected Participant, to cause any
Incentive Stock Option previously granted to fail to qualify for the federal
income tax treatment afforded under Section 421 of the Code. Incentive Stock
Options shall not be granted to Directors. Incentive Stock Options shall not be
granted under the Plan on or after December 31, 2014.
7.4 LEAVE OF ABSENCE OR TRANSFER. Transfer between the Company and
Parent or any subsidiary or affiliate of Company or Parent, or between
subsidiaries of the Company, or a leave of absence duly authorized by the
Company, shall not be deemed a termination of employment. A Participant may not,
however, exercise an Option or related Stock Appreciation Right during any leave
of absence unless authorized to do so by the Company's compensation manager.
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7.5 REDUCTION IN PRICE OR REISSUANCE. In no event shall the Committee
cancel any outstanding Option for the purpose of reissuing the Option
to the Participant at a lower exercise price or reduce the exercise price of a
previously issued Option.
7.6 AGGREGATE GRANT. The aggregate number of shares of Stock with
respect to which Options or Stock Appreciation Rights may be granted to a single
Participant throughout the duration of the Plan may not exceed 30% of the total
number of shares of Stock available for issuance pursuant to Section 3.1.
8. STOCK APPRECIATION RIGHTS.
8.1 TERMS AND AGREEMENT. Subject to the terms of the Plan, Stock
Appreciation Rights may be granted to Participants at any time as determined by
the Committee. The Committee shall determine, and the Agreement shall reflect,
the following for each SAR granted:
(a) the number of shares subject to each SAR;
(b) whether the SAR is a Related SAR or a Freestanding SAR;
(c) duration of the SAR;
(d) vesting requirements, if any;
(e) rights of the Participant upon termination of employment or
termination of service as a Director (which may be different based on the
reason for termination); and
(f) any other terms or conditions established by the Committee.
8.2 RELATED AND FREESTANDING SARS. A Stock Appreciation Right may be
granted in connection with an Option, either at the time of grant or at any time
thereafter during the term of the Option (a "Related SAR"), or may be granted
unrelated to an Option (a "Freestanding SAR").
8.3 SURRENDER OF OPTION. A Related SAR shall require the holder,
upon exercise, to surrender the Option with respect to the number of shares as
to which the SAR is exercised, in order to receive payment. The Option will, to
the extent surrendered, cease to be exercisable.
8.4 REDUCTION IN NUMBER OF SHARES SUBJECT TO RELATED SARS. For
Related SARs, the number of shares subject to the SAR shall not exceed the
number of shares subject to the Option. For example, if the SAR covers the same
number of shares as the Option, the exercise of a portion of the Option shall
reduce the number of shares subject to the SAR to the number of shares remaining
under the Option. If the Related SAR covers fewer shares than the Option, the
exercise of a portion of the
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Option shall reduce the number of shares subject to the SAR to the extent
necessary so that the number of remaining shares subject to the SAR is not more
than the remaining shares under the Option.
8.5 EXERCISABILITY. Subject to Section 8.7 and to any rules and
restrictions imposed by the Committee, a Related SAR will be exercisable at the
time or times, and only to the extent, that the Option is exercisable and will
not be transferable except to the extent that the Option is transferable. A
Freestanding SAR will be exercisable as determined by the Committee but in no
event after 10 years from the date of grant.
8.6 PAYMENT. Upon the exercise of a Stock Appreciation Right, the
holder will be entitled to receive payment of an amount determined by
multiplying:
(a) The excess of the Fair Market Value on the date of exercise
over the Fair Market Value on the date of grant, by
(b) The number of shares with respect to which the SAR is being
exercised.
The Committee may limit the amount payable upon exercise of a Stock
Appreciation Right. Any limitation must be determined as of the date of grant
and noted on the Agreement evidencing the grant.
Payment will be made in Stock.
8.7 REDUCTION IN PRICE OR REISSUANCE. In no event shall the
Committee cancel any outstanding Stock Appreciation Right for the purpose of
reissuing the Stock Appreciation Right to the Participant at a lower exercise
price or reduce the exercise price of a previously issued Stock Appreciation
Right.
8.8 ADDITIONAL TERMS. The Committee may impose additional conditions
or limitations on the exercise of a Stock Appreciation Right as it may deem
necessary or desirable to secure for holders the benefits of Rule 16b-3, or any
successor provision, or as it may otherwise deem advisable.
9. RESTRICTED STOCK.
9.1 TERMS AND AGREEMENT. Subject to the terms of the Plan, shares of
Restricted Stock may be granted to Participants at any time as determined by the
Committee. The Committee shall determine, and the Agreement shall reflect, the
following for the Restricted Stock granted:
(a) the number of shares of Restricted Stock granted;
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(b) the purchase price, if any, to be paid by the Participant for
each share of Restricted Stock;
(c) the restriction period established pursuant to Subsection 9.2;
(d) any requirements with respect to elections under Section 83(b)
of the Code;
(e) rights of the Participant upon termination of employment or
termination of service as a Director (which may be different based on the reason
for termination); and
(f) any other terms or conditions established by the Committee.
9.2 RESTRICTION PERIOD. At the time of the grant of Restricted Stock,
the Committee shall establish a restriction period for the shares granted, which
may be time-based, based on the achievement of specified Performance Goals, a
combination of time- and Performance Goal-based, or based on any other criteria
the Committee deems appropriate. The Committee may divide the shares into
classes and assign a different restriction period for each class. The Committee
may impose additional conditions or restrictions upon the vesting of the
Restricted Stock as it deems fit in its sole discretion. If all applicable
conditions are satisfied, then upon the termination of the restriction period
with respect to a share of Restricted Stock, the share shall vest and the
restrictions of Section 9.3 shall lapse. To the extent required to ensure that a
Performance Goal-based Award of Restricted Stock to an executive officer is
deductible by the Company pursuant to Section 162(m) of the Code, any such Award
shall vest only upon the Committee's determination that the Performance Goals
applicable to the Award have been attained.
9.3 RESTRICTIONS ON TRANSFER PRIOR TO VESTING. Prior to the vesting of
Restricted Stock, the Participant may not sell, assign, pledge, hypothecate,
transfer, or otherwise encumber the Restricted Stock. Upon any attempt to
transfer rights in a share of Restricted Stock, the share and all related rights
shall immediately be forfeited by the Participant. Upon the vesting of a share
of Restricted Stock, the transfer restrictions of this section shall lapse with
respect to that share.
9.4 RIGHTS AS A SHAREHOLDER. Except for the restrictions set forth here
and unless otherwise determined by the Committee, the Participant shall have all
the rights of a shareholder with respect to shares of Restricted Stock,
including but not limited to the right to vote and the right to receive
dividends.
9.5 ISSUANCE OF CERTIFICATES.
(a) Following the date of grant, upon the Participant's request,
Parent shall issue a stock certificate, registered in the name of or for the
account of the
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Participant to whom the shares of Restricted Stock were granted, evidencing the
shares. Each stock certificate shall bear the following legend:
The transferability of this certificate and the shares of stock represented
hereby are subject to the restrictions, terms, and conditions (including
forfeiture provisions and restrictions against transfer) contained in the
Boise Incentive and Performance Plan and an Agreement entered into between
the registered owner of the shares and Boise Cascade, L.L.C.
This legend shall not be removed until the shares vest pursuant to the terms
stated.
(b) Each certificate, together with the stock powers relating to the
shares of Restricted Stock evidenced by the certificate, shall be held by Parent
unless the Committee determines otherwise.
(c) Following the date on which a share of Restricted Stock vests,
upon a Participant's request, Parent shall cause to be delivered to the
Participant to whom the shares were granted, a certificate evidencing the share
free of the legend stated in subsection (a) above.
9.6 SECTION 83(b) ELECTION. The Committee may provide in the Agreement
that the Award is conditioned upon the Participant making or not making an
election under Section 83(b) of the Code. If the Participant makes an election
pursuant to Section 83(b) of the Code, the Participant shall be required to file
a copy of the election with the Company within 10 days.
10. RESTRICTED STOCK UNITS.
10.1 TERMS AND AGREEMENT. Subject to the terms of the Plan, Restricted
Stock Units may be granted to Participants at any time as determined by the
Committee. The Committee shall determine, and the Agreement shall reflect, the
following for the Restricted Stock Units granted:
(a) the number of Restricted Stock Units awarded:
(b) the purchase price, if any, to be paid by the Participant for
each Restricted Stock Unit;.
(c) the restriction period established pursuant to Subsection 10.2;
(d) rights of the Participant upon termination of employment or
termination of service as a Director (which may be different based on the reason
for termination); and
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(e) any other terms or conditions established by the Committee.
10.2 RESTRICTION PERIOD. At the time of the grant of Restricted Stock
Units, the Committee shall establish a restriction period, which may be
time-based, based on the achievement of specified Performance Goals, a
combination of time- and Performance Goal-based, or based on any other criteria
the Committee deems appropriate. The Committee may divide the awarded units into
classes and assign a different restriction period for each class. The Committee
may impose any additional conditions or restrictions upon the vesting of the
Restricted Stock Units as it deems fit in its sole discretion. If all applicable
conditions are satisfied, then upon the termination of the restriction period
with respect to a Restricted Stock Unit, the unit shall vest. To the extent
required to ensure that a Performance Goal-based Award of Restricted Stock Units
to an executive officer is deductible by the Company pursuant to Section 162(m)
of the Code, any such Award shall become vested only upon the Committee's
determination that the Performance Goals applicable to the Award, if any, have
been attained.
10.3 PAYMENT. Upon vesting of a Restricted Stock Unit, the Participant
shall be entitled to receive payment of an amount equal to the Fair Market Value
of one share of Stock. Payment may be made in cash, Stock, or a combination of
cash and Stock, in the Committee's sole discretion.
11. PERFORMANCE UNITS.
11.1 TERMS AND AGREEMENT. Subject to the terms of the Plan, Performance
Units may be granted to Participants at any time as determined by the Committee.
The Committee shall determine, and the Agreement shall reflect, the following
for the Performance Units granted:
(a) the number of Performance Units awarded;
(b) the initial value of a Performance Unit;
(c) the rights of the Participant upon termination of employment or
termination of service as a Director (which may be different based on the reason
for termination);
(d) the performance period and Performance Goals applicable to the
Award; and
(e) any other terms or conditions established by the Committee.
11.2 PAYMENT. After the applicable performance period has ended, the
Committee will review the Performance Goals and determine the amount payable
with respect to the Award, based upon the extent to which the Performance Goals
have
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been attained within the performance period and any other applicable terms and
conditions. Payment of earned Performance Units may be made in cash, Stock, or a
combination of cash and Stock, in the Committee's sole discretion.
12. PERFORMANCE SHARES.
12.1 TERMS AND AGREEMENT. Subject to the terms of the Plan, Performance
Shares may be granted to Participants at any time as determined by the
Committee. The Committee shall determine, and the Agreement shall reflect, the
following for the Performance Shares granted:
(a) the number of Performance Shares awarded;
(b) the performance period and Performance Goals applicable to the
Award;
(c) whether dividend equivalents will be credited with respect to
Performance Shares, and if so, any accrual, forfeiture, or payout restrictions
on the dividend equivalents; provided that dividend equivalents will not be
credited if they are determined to be "nonqualified deferred compensation" under
Section 409A of the Code;
(d) the rights of the Participant upon termination of employment or
service as a Director (which may be different based on the reason for
termination); and
(e) any other terms or conditions established by the Committee.
12.2 INITIAL VALUE. The initial value of each Performance Share shall
be the Fair Market Value on the date of grant.
12.3 PAYMENT. After the applicable performance period has ended, the
Committee will review the Performance Goals and determine the amount payable
with respect to the Award, based upon the extent to which the Performance Goals
have been attained within the performance period and any other applicable terms
and conditions. Payment of earned Performance Shares may be made in cash, Stock,
or a combination of cash and Stock, as determined by the Committee in its sole
discretion.
13. ANNUAL INCENTIVE AWARDS.
13.1 AWARD PERIOD AND PERFORMANCE GOALs. The award period for Annual
Incentive Awards is a fiscal year, which may be a calendar year, provided that
the award period for Annual Incentive Awards granted in 2004 is the period
beginning October 29, 2004, and ending December 31, 2004. Within 90 days of the
beginning of each award period, the Committee shall establish the specific
Performance Goals to be achieved in order for Participants to earn an Annual
Incentive Award. The Committee
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shall establish a mathematical formula pursuant to which an Award equal to a
specified percentage of a Participant's salary shall be earned upon the
attainment of specific levels of the applicable Performance Goals. This formula
may take into account Performance Goals achieved in prior years. The Performance
Goals and formula, once established, shall continue for subsequent years unless
modified by the Committee. The Performance Goals applicable to an Award Period,
and the formula pursuant to which Award amounts shall be determined, shall be
selected and published within 90 days from the beginning of the award period.
13.2 PAYMENT. As soon as practical after the conclusion of the award
period, the Committee shall review and evaluate the Performance Goals applicable
to that award period in light of the Company's performance measured in
accordance with the goals and shall determine whether the goals have been
satisfied. If satisfied, the Committee shall so certify in a written statement
and shall apply the criteria to determine the amount of the Award for each
Participant, subject to the Committee's right to reduce or eliminate the amount
of any Award under Section 30. Payment of earned Annual Incentive Awards may be
made in cash, Stock, or a combination of cash and Stock, in the Committee's sole
discretion. No Award may be paid to a Participant in excess of $ for any
single year.
14. STOCK BONUSES. Subject to the terms of the Plan, a Stock Bonus may be
granted to one or more Participants at any time as determined by the Committee.
If the Committee grants a Stock Bonus, a certificate for the shares of Stock
constituting the Stock Bonus shall be issued in the name of the Participant to
whom the grant was made and delivered as soon as practicable after the date on
which the Stock Bonus is payable.
15. RIGHTS AS A SHAREHOLDER. Except as otherwise provided in Section 9.4
with respect to Restricted Stock, no person shall have any rights as a
shareholder with respect to any shares of Stock covered by or relating to an
Award until the date of issuance of a stock certificate with respect to the
shares (or, if such shares are held in "book-entry" form, the date upon which a
stock certificate first could have been issued). Except as otherwise provided in
Sections 3.3 and 12.1, no adjustment to any Award shall be made for dividends or
other rights for which the record date occurs prior to the date the stock
certificate is issued.
16. EMPLOYMENT NOT GUARANTEED. This Plan is not intended to and does not
create a contract of employment in any manner. Employment with the Company
and/or any subsidiary or affiliate of the Company is at will, which means that
either the employee or the employer may end the employment relationship at any
time and for any reason. Nothing in this Plan changes, or should be construed as
changing, that at-will relationship.
17. SECURITIES MATTERS.
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17.1 DELIVERY OF STOCK CERTIFICATES. Notwithstanding anything in this
Plan to the contrary, Parent shall not be obligated to issue or deliver any
certificates evidencing shares of Stock unless and until (a) Parent is advised
by its counsel that the issuance and delivery of certificates is in compliance
with all applicable laws, regulations of governmental authority, and the
requirements of any securities exchange on which the Stock is traded; and (b)
any governmental approvals Parent deems necessary or advisable have been
obtained. The Committee may require, as a condition of the issuance and delivery
of certificates, that the recipient make any agreements and representations and
that the certificates bear any legends as the Committee, in its sole discretion,
deems necessary or desirable.
17.2 WHEN TRANSFER IS EFFECTIVE. The transfer of any shares of Stock
shall be effective only when counsel to Parent has determined that the issuance
and delivery of the shares is in compliance with all applicable laws,
regulations, and the requirements of any securities exchange on which shares of
Stock are traded. The Committee may, in its sole discretion, defer the
effectiveness of any transfer of shares of Stock in order to allow the issuance
of the shares to be made pursuant to registration or an exemption from
registration or other methods for compliance available under federal or state
securities laws. The Committee shall inform the Participant in writing of its
decision to defer the effectiveness of a transfer. During the period of deferral
in connection with the exercise of an Option, the Participant may, by written
notice, withdraw the exercise and obtain the refund of any amount paid in
connection with the exercise.
18. WITHHOLDING TAXES. When cash is to be paid pursuant to an Award, the
Company may deduct an amount sufficient to satisfy any federal and state taxes
required by law to be withheld. When shares of Stock are to be delivered
pursuant to an Award, the Company may require the Participant to remit in cash
an amount sufficient to satisfy any federal and state taxes required by law to
be withheld. With the Committee's approval, a Participant may elect to satisfy
the withholding requirement, in whole or in part, by having the Company withhold
shares of Stock having a Fair Market Value on the date the tax is to be
determined equal to the minimum statutory total tax that could be imposed on the
transaction. All such elections shall be irrevocable, made in writing, and
signed by the Participant, and shall be subject to any restrictions or
limitations that the Committee, in its sole discretion, deems appropriate. The
shares shall be valued at Fair Market Value on the date the amount of tax to be
withheld is determined. Notwithstanding the foregoing, (i) if Parent and/or the
Company is not using APB Opinion 25 to account for equity awards in its
financial statements, or (ii) with respect to Annual Incentive Awards or Awards
of Performance Units, the Company may permit Participants to elect in writing,
subject to restrictions imposed by the Company, to have additional tax withheld
in a total amount equal to the tax that could be imposed on the transaction.
19. AMENDMENT AND TERMINATION. The Committee may, at any time, amend or
terminate the Plan; provided that no amendment shall be made without shareholder
approval if approval is required under applicable law or if the amendment would
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(a) decrease the grant or exercise price of any Stock-based Award to less than
the Fair Market Value on the date of grant, (b) increase the total number of
shares of Stock available under the Plan, or (c) materially increase either the
cost of the Plan to Parent or the Company or the benefits to Participants. Any
amendment or termination shall not (1) violate Section 409A of the Code, or (2)
adversely affect the vested or accrued rights or benefits of any Participant
without the Participant's prior consent, provided that an amendment may
adversely affect the vested or accrued rights of a Participant without the
Participant's prior consent if such amendment is necessary to comply with
Section 409A of the Code or if, in the Committee's sole discretion, not amending
a Participant's vested or accrued rights or benefits would have adverse
consequences to Parent or the Company.
20. TRANSFERS UPON DEATH; NONASSIGNABILITY. Upon the death of a
Participant, outstanding Awards granted to the Participant may be exercised only
by the executor or administrator of the Participant's estate or by a person who
has acquired the right to exercise by will or the laws of descent and
distribution. No transfer of an Award by will or the laws of descent and
distribution shall be effective to bind the Company unless the Committee has
been furnished with (a) written notice and a copy of the will and/or such
evidence as the Committee may deem necessary to establish the validity of the
transfer, and (b) an agreement by the transferee to comply with all the terms
and conditions of the Award that would have applied to the Participant and to be
bound by the acknowledgments made by the Participant in connection with the
grant of the Award.
During the lifetime of a Participant, no Award is transferable, except
that the Committee may, in its sole discretion, permit the transfer of an
outstanding Award to the extent allowable under then-current law. Subject to
applicable law, the Committee's approval, and any conditions that the Committee
may prescribe, a Participant may, upon providing written notice to the secretary
of the Company, elect to transfer an Award to a member or members of his or her
immediate family (including, but not limited to, children, grandchildren, and
spouse, or a trust for the benefit of immediate family members or a partnership
in which immediate family members are the only partners) or to other persons or
entities approved by the Committee; provided, however, that no transfer by any
Participant may be made in exchange for consideration.
21. EXPENSES AND RECEIPTS. The expenses of the Plan shall be paid by the
Company. Any proceeds received by the Company in connection with any Award may
be used for general corporate purposes.
22. CHANGE IN CONTROL PROVISIONS.
22.1 VESTING AND EXERCISABILITY. Notwithstanding any other provision of
this Plan to the contrary, the provisions of this Article 22 shall apply in the
event of a Change of Control, unless otherwise determined by the Committee in
connection with the grant of an Award as reflected in the applicable Award
Agreement. Upon a Change of Control, all then-outstanding Stock Options and
Stock Appreciation Rights shall become fully vested and exercisable, and all
other then-outstanding Awards that are
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subject solely to time-based vesting shall vest in full and be free of
restrictions, except to the extent that another Award meeting the requirements
of Section 22.2 (a "Replacement Award") is provided to the Participant to
replace such Award (the "Replaced Award"). Upon a Change in Control, the
treatment of any other Awards shall be as determined by the Committee at the
time of grant, as reflected in the applicable Award Agreement:
22.2 REPLACEMENT AWARDS. An Award shall meet the conditions of this
Section 22.2 and qualify as a Replacement Award if:
(a) it has a value at least equal to the value of the Replaced Award
as determined by the Committee in its sole discretion;
(b) it relates to publicly traded equity securities of the Company
or its successor in the Change of Control or another entity that is affiliated
with the Company or its successor following the Change of Control; and
(c) its other terms and conditions are not less favorable to the
Participant than the terms and conditions of the Replaced Award (including the
provisions that would apply in the event of a subsequent Change of Control).
Without limiting the generality of the foregoing, the Replacement Award may take
the form of a continuation of the Replaced Award as long as the preceding
requirements of this Section 22.2 are satisfied. The determination of whether
the requirements of this Section 22.2 are satisfied shall be made by the
Committee, as constituted immediately before the Change of Control, in its sole
discretion.
22.3 SUBSEQUENT TERMINATION OF EMPLOYMENT. Upon a termination of
employment or termination of directorship of a Participant occurring in
connection with or during the period of two (2) years after such Change of
Control, other than termination for a Disciplinary Reason, (i) all Replacement
Awards held by the Participant shall become fully vested and (if applicable)
exercisable and free of restrictions, and (ii) all Stock Options and Stock
Appreciation Rights held by the Participant immediately before the termination
of employment or termination of directorship that the Participant held as of the
date of the Change of Control or that constitute Replacement Awards shall remain
exercisable for not less than one (1) year following such termination or until
the expiration of the stated term of such Stock Option or SAR, whichever period
is shorter; provided, that if the applicable Award Agreement provides for a
longer period of exercisability, that provision shall control.
22.4 TERMINATION PRIOR TO CHANGE IN CONTROL. Any Participant who is an
elected officer of Parent and whose employment is involuntarily terminated for
any reason other than a Disciplinary Reason within three months prior to the
date of the Change in Control, shall be treated, solely for purposes of this
Plan, as continuing in the Company's employment until the occurrence of the
Change in Control, and to have been terminated immediately thereafter.
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22.5 NO AMENDMENT. Notwithstanding Section 19, upon a Change in
Control, the provisions of this Section 22 may not be amended in any respect for
twelve months following a Change in Control but may be amended thereafter.
23. CLAIMS PROCEDURE. Claims for benefits under the Plan shall be filed in
writing, within 90 days after the event giving rise to a claim, with the
Company's compensation manager, who shall have absolute discretion to interpret
and apply the Plan, evaluate the facts and circumstances, and make a
determination with respect to the claim in the name and on behalf of the
Company. The claim shall include a statement of all facts the Participant
believes relevant to the claim and copies of all documents, materials, or other
evidence that the Participant believes relevant to the claim. Written notice of
the disposition of a claim shall be furnished to the Participant within 90 days
after the application is filed. This 90-day period may be extended an additional
90 days for special circumstances by the compensation manager, in his or her
sole discretion, by providing written notice of the extension to the claimant
prior to the expiration of the original 90-day period. If the claim is denied,
the compensation manager shall notify the claimant in writing. This written
notice shall:
(a) state the specific reasons for the denial;
(b) refer to Plan provisions on which the determination is based;
(c) describe any additional material or information necessary for
the claimant to perfect the claim and explain why the information is necessary;
and
(d) explain how the claimant may submit the claim for review and
state applicable time limits.
24. CLAIMS REVIEW PROCEDURE. Any Participant, former Participant, or
Beneficiary of either, who has been denied a benefit claim, shall be entitled,
upon written request, to access to or copies of all documents and records
relevant to his or claim and to a review of his or her denied claim. A request
for review, together with a written statement of the claimant's position and any
other comments, documents, records, or information that the claimant believes
relevant to his or her claim, shall be filed no later than 60 days after receipt
of the written notification provided for in Section 23 and shall be filed with
the Company's compensation manager. The manager shall promptly inform the
Company's senior human resources officer. The senior human resources officer
shall make his or her decision, in writing, within 60 days after receipt of the
claimant's request for review. This 60-day period may be extended an additional
60 days if, in the senior human resources officer's sole discretion, special
circumstances warrant the extension and if the senior human resources officer
provides written notice of the extension to the claimant prior to the expiration
of the original 60-day period. The written decision shall be final and binding
on all parties and shall state the facts and specific reasons for the decision
and refer to the Plan provisions upon which the decision is based.
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25. LAWSUITS; VENUE; APPLICABLE LAW. No lawsuit claiming entitlement to
benefits under this Plan may be filed prior to exhausting the claims and claims
review procedures described in Sections 23 and 24. Any lawsuit must be initiated
no later than (a) one year after the event(s) giving rise to the claim occurred,
or (b) 60 days after a final written decision was provided to the claimant under
Section 24, whichever is sooner. Any legal action involving benefits claimed or
legal obligations relating to or arising under this Plan may be filed only in
Federal District Court in the city of Boise, Idaho. Federal law shall be applied
in the interpretation and application of this Plan and the resolution of any
legal action. To the extent not preempted by federal law, the laws of the state
of Delaware shall apply.
26. PARTICIPANT RIGHTS. No Participant shall have any claim to be granted
any Award under the Plan, and there is no obligation to treat Participants
uniformly.
27. UNSECURED GENERAL CREDITOR. Participants and their beneficiaries,
heirs, successors, and assigns shall have no legal or equitable rights,
interest, or claims in any property or assets of Parent or the Company. The
assets of Parent or the Company shall not be held under any trust for the
benefit of Participants, their beneficiaries, heirs, successors, or assigns, or
held in any way as collateral security for the fulfilling of the obligations of
Parent or the Company under this Plan. Any and all Parent or Company assets
shall be, and remain, the general, unpledged, unrestricted assets of Parent or
the Company. Parent's and/or the Company's obligation under the Plan shall be an
unfunded and unsecured promise of Parent and/or the Company, as appropriate.
28. NO FRACTIONAL SHARES. No fractional shares of Stock shall be issued or
delivered pursuant to the Plan. The Committee shall determine whether cash,
other Awards, or other property shall be issued or paid in lieu of any
fractional shares or whether fractional shares or any rights to fractional
shares shall be forfeited or otherwise eliminated.
29. BENEFICIARY. A Participant who is an elected officer of Parent or a
Director may file with the Committee a written designation of a beneficiary on
the form prescribed by the Committee and may, from time to time, amend or revoke
the designation. If no designated beneficiary survives the Participant, the
executor or administrator of the Participant's estate shall be deemed to be the
Participant's beneficiary.
30. NO DEFERRED COMPENSATION. No deferral of compensation (as defined under
Code Section 409A or guidance thereto) shall be permitted under this Plan.
However, the Committee may permit deferrals of compensation pursuant to a
separate plan which meets the requirements of Code Section 409A and the
regulations thereunder. Additionally, to the extent any Award is subject to Code
Section 409A, notwithstanding any provision herein to the contrary, the Plan
does not permit the acceleration of the time or schedule of any distribution
related to such Award, except as
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permitted by Code Section 409A, the regulations thereunder, and/or the Secretary
of the United States Treasury.
31. SECTION 162(m). The Plan is designed and intended, and all provisions
shall be construed in a manner, to comply, to the extent applicable, with
Section 162(m) of the Code and the regulations thereunder. To the extent
permitted by Section 162(m), the Committee shall have sole discretion to reduce
or eliminate the amount of any Award which might otherwise become payable upon
attainment of a Performance Goal.
32. FORM OF COMMUNICATION. Any election, application, claim, notice, or
other communication required or permitted to be made by a Participant to the
Committee or the Company shall be made in writing and in such form as the
Company may prescribe. Any communication shall be effective upon receipt by the
Company's compensation manager at 1111 West Jefferson Street, P.O. Box 50,
Boise, Idaho 83728.
33. SEVERABILITY. If any provision of the Plan is held to be invalid or
unenforceable, the other provisions of the Plan shall not be affected.
34. EFFECTIVE DATE AND TERM OF PLAN. The Plan shall be effective on
January 1, 2005. The Plan will expire on December 31, 2014. The Board of
Managers or the Committee may terminate the Plan at any time prior to
December 31, 2014. Awards outstanding at the expiration or termination of the
Plan shall remain in effect according to their terms and the provisions of the
Plan.
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