Exhibit
10.1(bg)


 


SECOND
AMENDMENT


SAUER-SUNDSTRAND
LASALLE FACTORY


EMPLOYEE
SAVINGS PLAN


(As
Amended and Restated as of January 1, 1998)


 


WHEREAS, the Company maintains the
Sauer-Sundstrand LaSalle Factory Employee Savings Plan (As Amended and Restated
as of January 1, 1998) (the “Plan”); and


 


WHEREAS, the Company desires to amend the Plan
to (1) bring the Plan into compliance with the requirements of the Small
Business Job Protection Act of 1996, and the Taxpayer Relief Act of 1997; (2)
add a Company stock fund as an investment option for its eligible employees,
and (3) make certain other changes with respect to applicable interest rates on
plan loans.


 


NOW
THEREFORE, BE IT RESOLVED, that pursuant to the amending power reserved to this Company by
Section 14.1, the Plan be, and it hereby is, amended, effective as of the dates
set forth below, in the following respects:


 


1.             Section 1.18 is amended, effective as of January 1,
2000, to read as follows:


 


“1.18       A ‘Fund’ shall mean any of the
funds in which Plan assets may be invested as described in Section 8.2.”


 


2.             Section 6.3(f)(ii) is amended, effective as of January
1, 1998, to read as follows:


 


“A
Participant’s ‘Compensation’ shall include that Participant’s wages,
salaries, fees for professional services and other amounts received for
personal services actually rendered in the course of employment with the
Employer (including, but not limited to, commissions paid to salesman,
compensation for services on the basis of a percentage of profits, tips, and
bonuses), and all Compensation actually paid or made available to the
Participant for an entire Limitation Year, including elective deferrals (as
defined in Code Section 402(g)(3)), and any amounts that would have been
received as cash, but for an election to receive benefits under a cafeteria
plan satisfying Code Section 125. 
Compensation shall exclude any other items or amounts paid to or for the
benefit of the Participant.”


 


3.             Sections 6.5(a) and 6.6(a) are amended, effective as of
January 1, 1997, by adding the following at the end of the respective
subsections:


 


“Notwithstanding
the foregoing, for Plan Years commencing on and after January 1, 1997 through
the end of the remedial amendment period as described in Notice 97-41, and
modified by any subsequent Internal Revenue Service publication, the ADP for
the Nonhighly Compensated Employee Group may be determined on the basis of data
from the current Plan Year.”


 


 





















 


4.             Section
6.5(d)(ii) is amended, effective as of January 1, 1997, to read as follows:


 


“(ii)                            Distribution of Excess Contributions (and any income
allocable thereto) to the appropriate Highly Compensated Employees.  Such distribution shall be determined and
made as follows:  First, the total dollar
amount of excess contributions for each affected Highly Compensated Employee
shall be determined.  Second, such dollar
amounts shall be aggregated for all affected Highly Compensated Employees.  Third, the Highly Compensated Employee with
the highest dollar amount in Participant Contributions shall be reduced by an
amount necessary for such Highly Compensated Employee’s Participant
Contributions to equal that of the Highly Compensated Employee with the next
highest dollar amount in Participant Contributions.  Such reduction is then distributed to the
Highly Compensated Employee with the highest dollar amount.  However, if a lesser reduction, when added to
the total dollar amount already distributed under the foregoing, would equal
the total excess contributions, the lesser amount shall be distributed.  If Excess Contributions remain, the foregoing
procedures are repeated until the excess contributions are distributed.”


 


5.             Section 6.6(d)(ii) is amended, effective as of January
1, 1997, to read as follows:


 


“(ii)                            Distribution of any vested Excess Aggregate Contributions
(and any income allocable thereto) to the appropriate Highly Compensated
Employees.  Distribution of vested Excess
Aggregate Contributions shall be made in accordance with the procedures for
distributing Excess Contributions as set forth above in Section 6.5(d)(ii); or”


 


6.             Section 7.1 of the Plan is amended, effective as of
January 1, 2000, to read as follows:


 


“7.1         Deposit of Employer and Matching
Contributions.  Upon receipt of
Employer or Matching Contributions, the Trustee shall deposit within 14
business days such Contributions in accordance with the investment election of
each Participant with respect to such 
Participant’s Participant Contributions. 
If no such election is received by the Trustee, such Contributions shall
be invested in the Default Fund (as defined in Section 8.2(b)).”


 


7.             Section 7.3 is amended, effective as of August 31, 1998
to read as follows:


 


“7.3         Investment Election for Participant
Contributions at Time of Initial Participation.  Each Participant in Participant Contributions
shall, upon electing to become a Participant under the Plan pursuant to Section
3.2 and on a form suitable to the Plan Administrator, make an election as to the
manner in which Participant Contributions


 


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made by the Employer on
his behalf are to be invested by the Trustee. 
A Participant’s investment election shall specify the percentage of his
Participant Contributions to be invested in one or more of the Funds described
in Section 8.2.  Unless changed by a
Participant under Section 7.4, the investment election initially made by a
Participant shall remain in effect until he ceases to be a Participant under
the Plan.”


 


9.             Section 8.2 is amended, in its entirety, effective as of
January 1, 2000, to read as follows:


 


“8.2         Establishment of Funds. The
Trustee, at the direction of the Plan Administrator, shall establish the
following no-load investment Funds under the Trust Agreement:


 


(i)            IRT Stable Value Fund;


(ii)           INVESCO Select Income Fund;


(iii)          INVESCO Total Return Fund;


(iv)          Fidelity Equity Income Fund;


(v)            IRT 500 Index Fund;


(vi)          AIM Blue Chip Fund;


(vii)         INVESCO Small Company Value Fund; and


(viii)        IRT International Equity Fund


(ix)           The Transamerica Life Insurance Fund.


 


Notwithstanding the
foregoing, effective January 1, 2000, the following provisions shall apply:


 


(a)                                  The Plan Administrator may direct the
Trustee to add, change or eliminate from time to time one or more investment
funds, without an amendment to the Plan and upon such terms and conditions as
it deems appropriate.  Notwithstanding
the foregoing, the Plan Administrator shall direct the Trustee, in accordance
with Section 404(c) of ERISA, to make available at all times at least three
separate investment alternatives each of which is diversified and which have
materially different risk and return characteristics.  The investment alternatives in the aggregate
shall enable each Participant by choosing among them to achieve a portfolio
with aggregate risk and return characteristics at any point within a range
normally appropriate for the Participant, and which in the aggregate tend to
minimize through diversification the overall risk of the Participant’s
portfolio.  The Plan intends to constitute
a plan described in Section 404(c) of ERISA, such that to the extent permitted
by law the fiduciaries of the Plan shall be relieved of liability for any
losses that are the direct and necessary result of the 


 


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                                                investment instructions given by
Participants and Beneficiaries under the Plan.


 


(b)                                 Notwithstanding the foregoing, the
Investment Funds shall, at all times, include: (i) a Fund used for the
investment of Employer Matching Contributions and Participant Contributions for
which no investment election is provided, which Fund is designed to preserve
capital and provide fixed income until an investment election is made (‘Default
Fund’); (ii) a ‘Life Insurance Fund’ for the purpose of purchasing life
insurance under Article 8A; and, (iii) a Company Stock Fund, which is designed
to permit Participants to invest in shares of common stock of Sauer Inc., the
parent company of the Company (‘Company Stock’).”


 


10.           Section 8.3 is added, effective as of
January 1, 2000, to read as follows, and the remaining sections of Article 8
are renumbered accordingly:


 


“8.3         Company Stock Fund.  The provisions of this Section 8.3 set forth
special rules governing the investment of Participant Contributions into the
Company Stock Fund.


 


(a)                                  Investments in Company Stock Fund. 
Participants may elect to invest a portion of their Participant
Contributions in the Company Stock Fund. 
The maximum amount permitted to be invested shall be 30% of a Participant’s
Account balances, determined at the time the amount is transferred to, or
deposited in, the Company Stock Fund. 
The Company shall have the right (i) to pay from amounts transferred to
or deposited in the Company Stock Fund any brokerage fees and expenses
associated with such transfer and acquisition of Company Stock, and (ii) to pay
from the Participant’s Accounts any brokerage fees and expenses associated with
the conversion of such units to any other Investment Fund and/or cash.


 


(b)                                 Voting Rights. 
Participants with Contributions invested in Company stock shall be entitled
to vote the shares allocated to the Participant’s Account.  Within a reasonable time prior to each annual
or special meeting of the shareholders of the Sauer Inc., the Company shall
send to each Participant a copy of the proxy soliciting material (including an
annual report) for the meeting, together with a form requesting instructions to
the Trustee on how to vote the proportional number of shares of Company Stock
(and any fractional share thereof) attributable to the Participant’s interest
in the Company Stock Fund.  Upon receipt
of such 


 


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                                                instruction, the Trustee shall vote such
shares to the extent possible to reflect such Participants instructions.  If the Trustee does not receive voting instructions
from a Participant, the Trustee shall vote the Company Stock attributable to
each Participant’s interest in the same proportion as the Trustee votes the
shares of Company Stock which are attributable to Participants’ interests in
the Company Stock Fund of which the Trustee received voting instructions.


 


Notwithstanding
any provision of the Plan to the contrary, if a tender or exchange offer is
made for a majority of the outstanding shares of Company Stock, a Participant
shall direct the Trustee as to the disposition of the proportional number of
shares of Company Stock attributable to his interest in the Company Stock
Fund.  If a Participant does not direct
the Trustee as to the disposition of the Company Stock attributable to his
Company Stock Fund with the time specified, such Participant shall be deemed to
have timely instructed the Trustee not to tender or exchange such shares of
Company Stock.


 


Information
relating to the purchase, holding and sale of Company Stock and the exercise of
shareholder rights with respect to such Company Stock by Participants shall be
maintained in accordance with procedures designed by the Trustee to safeguard
the confidentiality of such actions by the Participant, except to the extent
necessary to comply with federal or state laws.


 


(c)                                  Compliance with Federal Securities Laws. 
The Company reserves the right to file with the Securities Exchange
Commission (the ‘SEC’)a Registration Statement on Form S-8 in connection with
registration of the shares of common stock of Sauer Inc. and the participation
interests to be offered and sold to the Plan.


 


Notwithstanding
any provision of this Section to the contrary, if a Participant is a person
subject to Section 16 of the Securities and Exchange Act of 1934 (‘Section 16’)
as of January 1, 2000, such Participant shall not be permitted to invest his
Participant Contributions in the Company Stock Fund until such time as he is no
longer subject to Section 16.  If a
Participant is not subject to Section 16 as of January 1, 2000, but later
becomes subject to Section 16, he shall not be permitted, as of the date he
becomes subject to such Section, to invest future Participant Contributions in
the Company Stock Fund.  With respect to
investments already


 


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made in the
Company Stock Fund, such Participant shall, at his option, make an election to
transfer out of the Common Stock Fund; provided that such transfer is made at
least six months after any investment election into the Common Stock Fund, or
purchase of Company stock under any other plan maintained by the Company.”


 


11.           Article VIII-A and Sections 7.4,
10.1, and 12.4 are amended, effective as of January  1, 2000, by substituting “Life Insurance
Fund” for “Transamerica Life Insurance Fund” wherever the latter appears, and
by substituting “Default Fund” for “Norwest Stable Return Fund” wherever the
latter appears.


 


12.           Section 9.3 is amended, effective as
of August 31, 1998, to read as follows:


 


“9.3         Interest Rate.  The interest rate to be paid by an Active
Participant on a new loan shall be the prime lending rate published by the Wall Street Journal on the first business day of the month
preceding the month in which the application for the loan is received by the
Plan Administrator, plus 1-1/2 percentage points.”


 


13.           Section 12.4(f) is added, effective
as of January 1, 2000, to read as follows:


 


“(f)                              In-Kind Distributions. 
A Participant may elect to receive amounts distributed from his Account
invested in the Company Stock Fund in whole shares of Company Stock, with any
fractional shares paid in cash.  Such
election and the method of transfer of the shares shall be in such form and
manner as is established by the Plan Administrator.”


 


14.           Section 12.8(c) is amended, effective
as of January 1, 1997, to read as follows:


 


“(c)                            In no event shall distribution with
respect to a Participant commence later than:


 


(i)                                     for a Participant who is not a five
percent (5%) owner (as described in Code Section 416(i)), the later of (1) the
April 1 of the calendar year next following the calendar year in which the
Participant attains age 701⁄2, or (2) the April 1 of the calendar year in which
the Participant terminates employment; and


 


(ii)                                  for a Participant who is a five percent
(5%) owner, the  calendar year following
the calendar year in which the Participant attains age 701⁄2, or such other date
as may be prescribed by applicable laws or regulations.


 


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Notwithstanding
the foregoing, if a Participant who is not a five percent (5%) owner attains
age 701⁄2 on or after January 1, 1996 and before January 1, 1999, and
is still employed by the Employer on April 1 of the calendar year
following the year in which he attained age 701⁄2, such Participant may elect to
commence distribution effective as of April 1 of the calendar year
following the calendar year in which he attained age 701⁄2 or to delay
commencement of distribution until the Participant terminates employment.”


 


Dated this 6th
day of December, 1999 at Ames, Iowa.


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ RONALD C. HANSON

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Ronald C. Hanson

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Director of Human
  Resources