Exhibit 10.2

 

NASH FINCH COMPANY

1995 DIRECTOR STOCK OPTION PLAN

 

 

 

(As amended on February 22, 2000 and February 19, 2002)

 

1.                                       Purpose of Plan.

 

                The purpose of the Nash Finch Company 1995 Director Stock Option
Plan (the “Plan”) is to advance the interests of Nash Finch Company (the
“Company”) and its stockholders by enabling the Company to attract and retain
the services of experienced and knowledgeable directors and to increase the
proprietary interests of such directors in the Company’s long-term success and
progress and their identification with the interests of the Company’s
stockholders.

 

2.                                       Definitions.

 

                The following terms will have the meanings set forth below,
unless the context clearly otherwise requires:

 

                2.1           “Board” means the Board of Directors of the
Company.

 

                2.2           “Code” means the Internal Revenue Code of 1986, as
amended.

 

                2.3           “Committee” means the group of individuals
administering the Plan, as provided in Section 3 of the Plan.

 

                2.4           “Common Stock” means the common stock of the
Company, par value $1.66 2/3 per share, or the number and kind of shares of
stock or other securities into which such Common Stock may be changed in
accordance with Section 4.3 of the Plan.

 

                2.5           “Disability” means the disability of an Eligible
Director such as would entitle the Eligible Director to receive disability
income benefits pursuant to the long-term disability plan of the Company then
covering the Eligible Director or, if no such plan exists or is applicable to
the Eligible Director, the permanent and total disability of the Eligible
Director within the meaning of Section 22(e)(3) of the Code.

 

                2.6           “Eligible Directors” means all directors of the
Company who are not, as of the date of grant of an Option, full-time employees
of the Company or any subsidiary of the Company.

 

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

 

                2.8           “Fair Market Value” means, with respect to the
Common Stock, as of any date (or, if no shares were traded or quoted on such
date, as of the next preceding date on which there was such a trade or quote),
the mean between the reported high and low sale prices of the Common Stock
during the regular trading session as reported on the Nasdaq National Market or
any stock exchange on which the Common Stock is listed.

 

                2.9           “Option” means a right to purchase 5,000 shares of
Common Stock (subject to adjustment as provided in Section 4.3 of the Plan)
granted to an Eligible Director pursuant to Section 5 of the Plan.  An Option
does not qualify as an “incentive stock option” within the meaning of
Section 422 of the Code.

 

                2.10         “Retirement” means the retirement of an Eligible
Director pursuant to and in accordance with the normal retirement/pension plan
or practice of the Company then covering the Eligible Director.

 

 

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                2.11         “Securities Act” means the Securities Act of 1933,
as amended.

 

3.                                       Plan Administration.

 

                The Plan will be administered by a committee (the “Committee”)
consisting solely of two or more members of the Board.  All questions of
interpretation of the Plan will be determined by the Committee, each
determination, interpretation or other action made or taken by the Committee
pursuant to the provisions of the Plan will be conclusive and binding for all
purposes and on all persons, and no member of the Committee will be liable for
any action or determination made in good faith with respect to the Plan or any
Option granted under the Plan.  The Committee, however, will have no power to
determine the eligibility for participation in the Plan, the number of shares of
Common Stock to be subject to Options, or the timing, pricing or other terms and
conditions of the Options.

 

4.                                       Shares Available for Issuance.

 

                4.1           Maximum Number of Shares Available.  Subject to
adjustment as provided in Section 4.3 of the Plan, the maximum number of shares
of Common Stock that will be available for issuance under the Plan will be
250,000 shares.  The shares available for issuance under the Plan may, at the
election of the Committee, be either treasury shares or shares authorized but
unissued, and, if treasury shares are used, all references in the Plan to the
issuance of shares will, for corporate law purposes, be deemed to mean the
transfer of shares from treasury.

 

                4.2           Accounting for Options.  Shares of Common Stock
that are issued under the Plan or that are subject to outstanding Options will
be applied to reduce the maximum number of shares of Common Stock remaining
available for issuance under the Plan.  Any shares of Common Stock that are
subject to an Option that lapses, expires, or for any reason is terminated
unexercised will automatically again become available for issuance under the
Plan.

 

                4.3           Adjustments to Shares and Options.  In the event
of any reorganization, merger, consolidation, recapitalization, liquidation,
reclassification, stock dividend, stock split, combination of shares, rights
offering, divestiture or extraordinary dividend (including a spin-off) or any
other change in the corporate structure or shares of the Company, the Committee
(or, if the Company is not the surviving corporation in any such transaction,
the board of directors of the surviving corporation) will make appropriate
adjustment (which determination will be conclusive) as to the number and kind of
securities available for issuance under the Plan and, in order to prevent
dilution or enlargement of the rights of Eligible Directors, the number, kind
and, where applicable, exercise price of securities subject to outstanding
Options.

 

5.                                       Options.

 

                5.1           Grant.  On an annual basis, each director of the
Company who qualifies as an Eligible Director immediately following each annual
meeting of stockholders of the Company will be granted an Option.

 

                5.2           Exercise Price.  The per share price to be paid by
an Eligible Director upon exercise of an Option will be 100% of the Fair Market
Value of one share of Common Stock on the date of grant.  The total purchase
price of the shares to be purchased upon exercise of an Option will be paid
entirely in cash (including check, bank draft or money order).

 

                5.3           Exercisability and Duration.  Each Option will
become exercisable in full six months following its date of grant and, subject
to earlier termination in accordance with Section 5.6 of the Plan, will expire
and will no longer be exercisable five years from its date of grant.

 

                5.4           Manner of Exercise.  An Option may be exercised by
an Eligible Director in whole or in part from time to time, subject to the
conditions contained in the Plan and in the agreement evidencing such Option, by

 

 

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delivery in person, by facsimile or electronic transmission or through the mail
of written notice of exercise to the Company (Attention: Corporate Secretary) at
its principal executive office in Edina, Minnesota and by paying in full the
total exercise price for the shares of Common Stock to be purchased in
accordance with Section 5.2 of the Plan.

 

                5.5           Rights as a Stockholder.  As a holder of Options,
an Eligible Director will have no rights as a stockholder unless and until such
Options are exercised for shares of Common Stock and the Eligible Director
becomes the holder of record of such shares.  Except as otherwise provided in
the Plan, no adjustment will be made for dividends or distributions with respect
to Options as to which there is a record date preceding the date the Eligible
Director becomes the holder of record of such shares.

 

                5.6           Effect of Termination of Service as Director.

 

                (a)           Termination Due to Death or Disability.  In the
event an Eligible Director’s service as a director of the Company is terminated
by reason of death or Disability, all outstanding Options then held by the
Eligible Director will become immediately exercisable in full and will remain
exercisable for one year following such termination (but in no event after the
expiration date of any such Option).

 

                (b)           Termination Due to Retirement.  In the event an
Eligible Director’s services as a director of the Company is terminated by
reason of Retirement, all outstanding options then held by the Eligible Director
will become immediately exercisable in full and (i) if granted prior to
February 22, 2000, will remain exercisable for one year following such
termination (but in no event after the expiration date of any such Option), and
(ii) if granted after February 22, 2000, will continue to be exercisable in
accordance with their terms.

 

                (c)           Termination for Reasons Other than Death,
Disability or Retirement.

 

                (i)            In the event an Eligible Director’s service as a
director of the Company is terminated for any reason other than death,
Disability or Retirement, all rights of the Eligible Director under the Plan and
any agreements evidencing an Option will immediately terminate without notice of
any kind and no Options then held by the Eligible Director will thereafter be
exercisable; provided, however, that if such termination is due to any reason
other than termination for “cause,” all outstanding Options then held by the
Eligible Director will remain exercisable to the extent exercisable as of such
termination for a period of three months after such termination (but in no event
after the expiration date of any such Option).

 

                (ii)           For purposes of this Section 5.6, “cause” will be
as defined in any agreement or policy applicable to the Eligible Director or, if
no such agreement or policy exists, will mean (i) dishonesty, fraud,
misrepresentation, embezzlement or material and deliberate injury or attempted
injury, in each case related to the Company or any subsidiary, (ii) any unlawful
or criminal activity of a serious nature, (iii) any willful breach of duty,
habitual neglect of duty or unreasonable job performance, or (iv) any material
breach of any service, confidentiality or noncompete agreement entered into with
the Company.

 

6.                                       Date of Termination of Service as a
Director.

 

                An Eligible Director’s service as a director of the Company
will, for purposes of the Plan, be deemed to have terminated on the date
recorded on the personnel or other records of the Company, as determined by the
Committee based upon such records.

 

 

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7.                                       Rights of Eligible Directors;
Transferability of Interests.

 

                7.1           Service as a Director.  Nothing in the Plan will
interfere with or limit in any way the right of the shareholders to remove an
Eligible Director at any time, and neither the Plan, nor the granting of an
Option nor any other action taken pursuant to the Plan, will constitute or be
evidence of any agreement or understanding, express or implied, that an Eligible
Director will be retained for any period of time or at any particular rate of
compensation.

 

                7.2           Restrictions on Transfer of Interests.  Except
pursuant to testamentary will or the laws of descent and distribution or as
otherwise expressly permitted by the Plan, no right or interest of any Eligible
Director in an Option prior to the exercise of Options will be assignable or
transferable, or subjected to any lien, during the lifetime of the Eligible
Director, either voluntarily or involuntarily, directly or indirectly, by
operation of law or otherwise.  In the event of an Eligible Director’s death,
exercise of any Options (to the extent permitted pursuant to Section 5 of the
Plan) may be made by the Eligible Director’s legal representatives, heirs and
legatees.

 

                7.3           Non-Exclusivity of the Plan.  Nothing contained in
the Plan is intended to modify or rescind any previously approved compensation
plans or programs of the Company or create any limitations on the power or
authority of the Board to adopt such additional or other compensation
arrangements as the Board may deem necessary or desirable.

 

8.                                       Securities Law and Other Restrictions.

 

                Notwithstanding any other provision of the Plan or any
agreements entered into pursuant to the Plan, the Company will not be required
to issue any shares of Common Stock under this Plan, and an Eligible Director
may not sell, assign, transfer or otherwise dispose of shares of Common Stock
issued pursuant to Options granted under the Plan, unless (a) there is in effect
with respect to such shares a registration statement under the Securities Act
and any applicable state securities laws or an exemption from such registration
under the Securities Act and applicable state securities laws, and (b) there has
been obtained any other consent, approval or permit from any other regulatory
body which the Committee, in its sole discretion, deems necessary or advisable. 
The Company may condition such issuance, sale or transfer upon the receipt of
any representations or agreements from the parties involved, and the placement
of any legends on certificates representing shares of Common Stock, as may be
deemed necessary or advisable by the Company in order to comply with such
securities law or other restrictions.

 

9.                                       Plan Amendment, Modification and
Termination

 

                The Board may suspend or terminate the Plan or any portion
thereof at any time, and may amend the Plan from time to time in such respects
as the Board may deem advisable in order that Options under the Plan will
conform to any change in applicable laws or regulations or in any other respect
the Board may deem to be in the best interests of the Company; provided,
however, that no amendments to the Plan will be effective without approval of
the stockholders of the Company if stockholder approval of the amendment is then
required pursuant to the rules of the Nasdaq Stock Market or any other stock
exchange, if applicable at such time.  No termination, suspension or amendment
of the Plan may adversely affect any outstanding Option without the consent of
the affected Eligible Director; provided, however, that this sentence will not
impair the right of the Committee to take whatever action it deems appropriate
under Section 4.3 of the Plan.

 

10.                                 Effective Date and Duration of the Plan

 

                The Plan is effective as of March 24, 1995, the date it was
adopted by the Board.  The Plan will terminate at midnight on March 1, 2005, and
may be terminated prior thereto by Board action, and no Option will be granted
after such termination.  Options outstanding upon termination of the Plan may
continue to be exercised, or become free of restrictions, in accordance with
their terms.

 

 

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11.                                 Miscellaneous

 

                11.1         Governing Law.  Except in connection with matters
of corporate governance and authority (all of which shall be governed by the
laws of the Company’s jurisdiction of incorporation), the validity,
construction, interpretation, administration and effect of the Plan and any
rules, regulations and actions relating to the Plan will be governed by and
construed exclusively in accordance with the laws of the State of Minnesota,
notwithstanding the conflicts of laws principles of any jurisdictions.

 

                11.2         Successors and Assigns.  The Plan will be binding
upon and inure to the benefit of the successors and permitted assigns of the
Company and the Eligible Directors.

 

 

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