Exhibit 10(g)

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SENIOR EXECUTIVE YEARLY INCENTIVE COMPENSATION PLAN

 

 

1.

PURPOSE

 

The Plan was approved by the Company’s stockholders in 1997, 2002, 2006, 2011
and 2016. The purpose of the Plan is to promote the success of the Company and
the creation of shareholder value by

(a)encouraging senior executives to focus maximum effort on achieving
high-quality performance objectives, Company profitability, and continued
Company growth, and (b) encouraging the attraction and retention of senior
executives with exceptional qualifications.

 

 

2.

ELIGIBILITY

 

The Company’s chief executive officer and such other senior executives as are
designated by the Committee shall be eligible to participate in the Plan.

 

 

3.

ADMINISTRATION

 

The Plan shall be administered by the Committee.  The Committee shall have the
authority to interpret the Plan and make all other decisions relating to the
administration of the Plan. The Committee may adopt such rules or guidelines as
it deems appropriate to administer the Plan. The Committee’s determinations
under the Plan shall be final and binding on all persons.

 

 

4.

AWARD DETERMINATION

 

Incentive awards paid under the Plan will be based solely on the attainment of
specified performance goals established by the Committee during the first 90
days of the Plan Year; provided, however, that the Committee may establish or
amend goals after the first 90 days for new hires or to reflect significant
changes in a participant’s responsibilities. Performance goals will be based on
objective criteria specifically defined by the Committee on a Company, business
unit or peer group comparison basis, which may include or exclude specified
items of an unusual or non-recurring nature and are based on one or more of the
following: net income, return on assets, return on net assets, return on sales,
return on capital, return on equity, return on revenue, sales growth, market
share, cash flow, cost reduction, total shareholder return, economic value
added, cash flow return on investment and cash value added. The Committee may
also establish performance goals based on subjective and/or objective criteria
relating to leadership or strategic

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objectives at the Company or business unit level, which may include or exclude
specified items of an unusual or non-recurring nature. Performance goals may
include a minimum, maximum and target level of performance with the size of
individual awards, if any, based on the level attained. Actual goal attainment
will be certified in writing by the Committee before payout.

 

The Committee, in its sole discretion, may reduce or eliminate any award
otherwise earned based on an assessment of individual performance, but in no
event may any such reduction result in an increase of the award payable to any
other participant. The Committee shall determine the amount of any such
reduction by taking into account such factors as it deems relevant including,
without limitation: (a) performance against other financial or strategic
objectives; (b) its subjective assessment of the executive’s overall performance
for the year; and (c) prevailing levels of total compensation among similar
companies.

 

The maximum amount that may be paid to any eligible participant in any year
under the Plan is $4,500,000.

 

 

5.

CHANGE IN CONTROL

 

If a Change of Control occurs, each participant will be entitled to the maximum
prorated award based on the number of full or partial months completed prior to
the Change in Control during the Plan Year in which the Change in Control
occurs.

 

 

6.

TERMINATION OF EMPLOYMENT

 

Participants who retire, resign or are terminated before the end of the Plan
Year are not eligible for an award for the Plan Year. In the event of death or
disability, payout will be prorated based on actual goal achievement and salary
received for the portion of the year worked.

 

 

7.

EMPLOYMENT RIGHTS

 

Neither the Plan, nor the payment of an award, nor any other action taken
pursuant to the Plan, shall constitute or be evidence of any agreement or
understanding, express or implied, that the Company or a Subsidiary will employ
any individual for any period of time, in any position or at any particular rate
of compensation.

 

 

8.

EFFECT OF MATERIAL RESTATEMENTS

 

The Board, in its sole discretion may recover all or part of an award under the
Plan if it determines that all of the following have occurred:

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(i)

any award under the Plan has been received by a Section 16 Officer or former
Section 16 Officer of the Company;

 

 

(ii)

the Section 16 Officer engaged in fraud that caused or substantially contributed
to material restatement of the Company’s financial statements; and

 

 

 

(iii)

the award was based in whole or in part based on financial results that were
subsequently subject to the material restatement.

 

 

 

 

9.

AMENDMENT OR TERMINATION OF THE PLAN

 

The Board may alter, amend or terminate the Plan at any time. An amendment of
the Plan shall be subject to the approval of the Company’s stockholders only to
the extent required by applicable laws, regulations or rules. No awards shall be
granted under the Plan after the termination thereof.

 

 

10.

EFFECTIVE DATE

 

The Plan shall be effective as of January 1, 2020.

 

 

11.

DEFINITIONS

 

 

(a)

“Board” means the Board of Directors of the Company, as constituted from time to
time.

 

 

 

(b)

“Change in Control” for purposes of this Plan has the meaning proscribed in the
Long Term Incentive Plan.

 

 

 

(c)

“Committee” means the Compensation Committee of the Board.

 

 

(d)

“Company” means PACCAR Inc, a Delaware corporation.

 

 

(e)

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

 

 

(f)

“Long Term Incentive Plan” means the PACCAR Inc Long Term Incentive Plan first
adopted by the Board on February 11, 1991 and amended from time-to-time
thereafter.

 

 

 

(g)

“Plan” means this amended and restated PACCAR Inc Senior Executive Yearly
Incentive Compensation Plan, as it may be amended from time to time.

 

 

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(h)

“Plan Year” means a calendar year.

 

 

(i)

“Section 16 Officer” means an executive officer as defined in section 16 of the
Exchange Act.

 

 

 

(j)

“Subsidiary” means an entity in which the Company directly or indirectly owns a
majority of all classes of outstanding equity.

 

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