**EXHIBIT10.2**

BRIGGS &STRATTON CORPORATION AND SUBSIDIARIES

2007 Annual Reporton Form 10-K

AMENDED AND RESTATEDECONOMIC VALUE ADDED

INCENTIVE COMPENSATIONPLAN

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As Amended and Restated

Effective 7-2-07

**BRIGGS& STRATTON CORPORATION**

**ECONOMIC VALUE ADDED**

**INCENTIVECOMPENSATION PLAN**

As adopted by theCompensation Committee on April 20, 2004 and amended on August 9, 2005 and onAugust 7, 2007

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BRIGGS & STRATTONCORPORATION

ECONOMIC VALUEADDED INCENTIVE COMPENSATION PLAN

I.                 PlanObjectives

A.           To promote themaximization of shareholder value over the long term by providing incentivecompensation to key employees of Briggs & Stratton Corporation (the“Company”) in a form which is designed to financially reward participants foran increase in the value of the Company to its shareholders.

B.             To providecompetitive levels of compensation to enable the Company to attract and retainemployees who are able to exert a significant impact on the value of theCompany to its shareholders.

C.             To encourage teamworkand cooperation in the achievement of Company goals.

D.            To recognizedifferences in the performance of individual participants.

II.             Plan Administration

The Compensation Committee of the Board of Directors(the “Committee”) shall be responsible for the design, administration, andinterpretation of the Plan.

III.         Definitions

A.           “Accrued Bonus”means the bonus, which may be negative or positive, which is calculated in themanner set forth in Section V.A.

B.             “Actual EVA”means the EVA as calculated for the relevant Plan Year.

C.             “Base Salary”means the amount of a Participant’s base compensation earned during the PlanYear without adjustment for bonuses, salary deferrals, value of benefits,imputed income, special payments, amounts contributed to a savings plan orsimilar items.

D.            “Capital” meansthe Company’s weighted average monthly operating capital for the Plan Year,calculated as follows:
|       |   | Current Assets                                                    |
|-------|--------|-------------------------------------------------------------------|
| -     |   | Non-operating Investments                                         |
| +     |   | Bad Debt Reserve                                                  |
| +     |   | LIFO Reserve                                                      |
| -     |   | Deferred Tax  Liabilities or Assets  Classified as Current Assets |
| -     |   | Current Noninterest-Bearing Liabilities                           |
| +     |   | Warranty Reserve                                                  |
| +     |   | Environmental Reserve                                             |
| +     |   | Property, Plant, Equipment, Net                                   |
| -     |   | Construction in Progress                                          |
| +     |   | Other Assets (not including prepaid Pension Costs)                |
| (+/-) |   | Unusual Capital Items                                             |

 

E.              “Capital Charge”means the deemed opportunity cost of employing Capital in the Company’sbusinesses, determined as follows:

CapitalCharge = Capital X Cost of Capital

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F.              Cost of Capital”means the weighted average of the cost of equity and the after tax cost of debtfor the relevant Plan Year on a market value basis.  The Cost of Capital will be determined (tothe nearest tenth of a percent) by the Committee prior to each Plan Year,consistent with the following methodology:

a)              Cost of Equity =Risk Free Rate + (Business Risk Index X Average Equity Risk Premium)

b)             Debt Cost of Capital= Debt Yield X (1 - Tax Rate)

c)              The weighted averageof the Cost of Equity and the Debt Cost of Capital is determined by referenceto the actual debt-to-capital ratio

where the Risk Free Rate is the average daily closingyield rate on 10 year U.S. Treasury Bonds for the month of March immediatelypreceding the relevant Plan Year, the Business Risk Index is determined byusing an averageof the Beta available inthe four (4) most recent Value Line reports on the Company.  The Average Equity Risk Premium is 6%, theDebt Yield is the weighted average yield of all borrowing included in theCompany’s permanent capital, and the tax rate is the combination of therelevant federal and state income tax rates.

G.             “Designated KeyContributor” means those Participants named by the Chief Executive Officeras a Designated Key Contributor under the Plan.

H.            “Divisional EVAPerformance Factor” means an Individual Performance Factor calculated inthe same manner as the Company Performance Factor as set forth in Section VI.A.,except that EVA, Actual EVA, Target EVA, EVA Leverage Factor, NOPAT, Capital,Capital Charge and other relevant terms shall be defined by reference to theparticular operating division, service division or sales group, not byreference to the entire Company.

I.                 “EconomicValue Added” or “EVA” means the NOPAT that remains after subtractingcapital Charge, expressed as follows:

NOPAT

Less:       Capital Charge

Equals:   EVA

EVA may bepositive or negative.

J.                “EVA LeverageFactor” means the expected deviation in EVA from the average EVA, generallyreflected as a percentage of capital employed. For purposes of this Plan, the Company’s EVA Leverage Factor isdetermined to be $27 million.

K.    “NOPAT”means cash adjusted net operating profits after taxes for the Plan Year,calculated as follows:
|     |   | Pretax Income                                            |
|-----|--------|----------------------------------------------------------|
| +   |   | Interest Expense                                         |
| -   |   | Normal Pension Costs                                     |
| +/- |   | Pension Income/Expense                                   |
| +/- |   | Change in LIFO Reserve                                   |
| +/- |   | Change in Bad Debt Reserve                               |
| +/- |   | Change in Post Retire Health Care Reserve                |
| +/- |   | Change in Warranty Reserve                               |
| +/- |   | Other Income & Expense on Non-Operating  Investments |
| +/- |   | Unusual Charges                                          |
| +/- |   | Amortization of Unusual Income or Expense Items          |
| -   |   | Cash Taxes on the above (+/-changes in Deferred  Taxes)  |

 

L.              “Plan Year”means the one year period coincident with the Company’s fiscal year.

M.   “Senior Executives”means those Participants designated as Senior Executives by the Committee withrespect to any Plan Year.

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N.      “Target EVA” meansthe target level of EVA for the Plan Year, determined as follows:
|              |   | Prior Year |   |   |   | Prior Year |
|--------------|--------|------------|--------|--------|--------|------------|
| Target EVA = |   | Target EVA |   | +      |   | Actual EVA |
|         |   | 2          |

IV.         Eligibility

A.           Eligible Positions.  In general, all Company Officers, DivisionGeneral Managers, and members of the corporate operations group, and certaindirect reports of such individuals may be eligible for participation in thePlan.  However, actual participation willdepend upon the contribution and impact each eligible employee may have on theCompany’s value to its shareholders, as determined by the Chief ExecutiveOfficer of the Company, and approved by the Committee.

B.             Nomination andApproval.  Each Plan Year, the ChiefExecutive Officer of the Company will nominate eligible employees of theCompany and its subsidiaries and affiliates to participate in the Plan for thenext Plan Year.  The Committee will havethe final authority to select Plan participants (the “Participants”) among theeligible employees nominated by the Chief Executive Officer of the Company.  Continued participation in the Plan iscontingent on approval of the Committee. Selection normally will take place, and will be communicated to eachParticipant, prior to the beginning of the pertinent Plan Year.

V.             IndividualParticipation Levels

A.           Calculation ofAccrued Bonus.  Each Participant’sAccrued Bonus will be determined as a function of the Participant’s BaseSalary, the Participant’s Target Incentive Award (provided in paragraph V.B.,below), Company Performance Factor (provided in Section VI.A.) and theIndividual Performance Factor (provided in Section VI.B.) for the PlanYear.  Each Participant’s Accrued Bonuswill be calculated as follows:
|        |   |               |   | Target    |   | Company     |   |   |   |               |   | Target    |   | Individual  |
|--------|--------|--------------------|--------|-----------|--------|-------------|--------|--------|--------|--------------------|--------|-----------|--------|-------------|
| 30     | %      | Participant’s | x      | Incentive | x      | Performance | +      | 70%    |   | Participant’s | x      | Incentive | x      | Performance |
|   |   | Base Salary        |   | Award     |   | Factor      |   |   |   | Base Salary        |   | Award     |   | Factor      |

 

In no case may theAccrued Bonus exceed three times the Target Incentive Award or be less thannegative one times the Target Incentive Award.

B.             Target IncentiveAwards.  The Target Incentive Awardswill be determined according to the following schedule:
| Executive Position                               | ** ** | **Target Incentive Award  (% of Base Salary)** | ** ** |
|-------------------------------------------------------|------------|-------------------------------------------------------------------------|------------|
| Chief Executive  Officer                              |       | 100                                                                     | %          |
| Chief Operating  Officer                              |       | 80                                                                      | %          |
| Executive Vice  President & Senior Vice President |       | 60                                                                      | %          |
| Other Elected  Officers                               |       | 40                                                                      | %          |
| Division General  Manager                             |       | 40                                                                      | %          |
| Designated Key  Contributors                          |       | 25                                                                      | %          |
| All Others                                            |       | 20                                                                      | %          |

 

VI.         Performance Factors

A.           Company PerformanceFactor Calculation.  For any PlanYear, the Company Performance Factor will be calculated as follows:

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CompanyPerformance Factor = 1.00  +  Actual EVA -  Target EVA

EVA Leverage Factor

B.             IndividualPerformance Factor Calculation. Determination of the Individual Performance Factor will be theresponsibility of the individual to whom the participant reports.  This determination will be subject toapproval by the Committee and should be in conformance with the process setforth below:

(1)          QuantifiableSupporting Performance Factors.  TheIndividual Performance Factor of the Accrued Bonus calculation will be based onthe accomplishment of individual, financial and/or other goals (“SupportingPerformance Factors”).  Wheneverpossible, individual performance will be evaluated according to quantifiablebenchmarks of success.  These SupportingPerformance Factors will represent an achievement percentage continuum thatranges from 50% to 150% of the individual target award opportunity, and will beenumerated from .5 to 1.5 based on such continuum. Provided, however, that ifthe Quantifiable Supporting Performance Factor is based on divisional EVA andis calculated in the same manner as the Company Performance Factor as set forthin Section VI.A. with respect to such division (such Supporting PerformanceFactor referred to herein as a Divisional EVA Performance Factor), then theSupporting Performance Factor may be unlimited, if so approved by theCommittee.  A Quantifiable SupportingPerformance Factor may also be unlimited if the Quantifiable SupportingPerformance Factor as approved by the Committee for such individual is the sameas the Company Performance Factor determined in accordance with Section VI.A.

(2)          Non-QuantifiableSupporting Performance Factors.  Whenperformance cannot be measured according to a quantifiable monitoring system,an assessment of the Participant’s overall performance may be made based on aNon-Quantifiable Supporting Performance Factor (or Factors).  The person to whom the Participant reportswill evaluate the Participant’s performance, and this evaluation will determinethe Participant’s Supporting Performance Factor (or Factors) according to thefollowing schedule:
| Individual  Performance Rating | ** ** | **Supporting**

**Performance Factor** |
|--------------------------------|------------|----------------------------------------|
|                           |       |
| Outstanding                    | 1.3 - 1.5  |
| Excellent                      | 1.1 - 1.3  |
| Good                           | .9 - 1.1   |
| Satisfactory                   | .5 - .9    |
| Unsatisfactory                 | 0          |

 

(3)          AggregateIndividual Performance Factor.  TheIndividual Performance Factor to be used in the calculation of the Accrued Bonusshall be equal to the average (or weighted average) of one or more Quantifiableand/or Non-Quantifiable Supporting Performance Factors according to relativeimportance, except that the Non-Quantifiable Supporting Performance Factorshall account for no more than 15% of the Accrued Bonus.

VII.  Change in Status During the Plan Year

A.           New Hire, Transfer,Promotion, Demotion

A newly hired employee oran employee transferred, promoted, or demoted during the Plan Year to aposition qualifying for participation (or leaving the participating class) mayaccrue (subject to discretion of the Committee) a pro rata Accrued Bonus basedon the percentage of the Plan Year (actual weeks/full year times a full yearaward amount for that position) the employee is in each participating position.

B.             Discharge

An employeedischarged during the Plan Year shall not be eligible for an Accrued Bonus,even though his or her service arrangement or contract extends past year-end,unless the Committee determines that the conditions of the termination indicatethat a prorated Accrued Bonus is appropriate. The Committee shall have full and final authority in making such adetermination.

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C.             Resignation

An employee whoresigns during the Plan Year to accept employment elsewhere (includingself-employment) will not be eligible for an Accrued Bonus.

D.            Death, Disability,Retirement

If a Participant’semployment is terminated during a Plan Year by reason of death, disability, ornormal or early retirement under the Company’s retirement plan, a tentativeAccrued Bonus will be calculated as if the Participant had remained employed asof the end of the Plan Year.  The finalAccrued Bonus will be calculated by multiplying the tentative Accrued Bonus bya proration factor.  The proration factorwill be equal to the number of full weeks of employment during the Plan Yeardivided by fifty-two.  For purposes ofthis section, the date a participant is deemed to be terminated pursuant todisability shall be the date the employee begins receiving a monthly Long TermDisability Benefit under the Company’s Group Insurance Plan.

Each employee mayname any beneficiary or beneficiaries (who may be named contingently orsuccessively) to whom any benefit under this Plan is to be paid in case of theemployee’s death.

Each suchdesignation shall revoke all prior designations by the employee, shall be inthe form prescribed by the Committee, and shall be effective only when filed bythe employee in writing with the Committee during his or her lifetime.

In the absence ofany such designation, benefits remaining unpaid at the employee’s death shallbe paid to the employee’s estate.

E.              Leave of Absence

An employee whose statusas an active employee is changed during a Plan Year as a result of a leave ofabsence may, at the discretion of the Committee, be eligible for a pro rataAccrued Bonus determined in the same way as in paragraph D. of this Section.

VIII.                         BonusPaid and Bonus Bank

All or a portion of theAccrued Bonus will be either paid to the Participant or credited to or chargedagainst the Bonus Bank as provided in this Article.

A.           Participants Who AreNot Senior Executives.  All positiveAccrued Bonuses of Participants who are not Senior Executives for the Plan Yearshall be paid in cash, less amounts required by law to be withheld for incomeand employment tax purposes, on or before the end of the second month followingthe end of the Plan Year in which the Accrued Bonus was earned.  Participants who are not Senior Executivesshall not be charged or otherwise assessed for negative Accrued Bonuses norshall such Participants have any portion of their Accrued Bonuses banked.

B.             Participants WhoAre Senior Executives.  The TotalBonus Payout to Participants who are Senior Executives for the Plan Year shallbe as follows:
|         |   | Accrued Bonus               |
|---------|--------|-----------------------------|
| Less:   |   | Extraordinary Bonus Accrual |
| Plus:   |   | Bank Payout                 |
| Equals: |   | Total Bonus Payout          |

 

The Total BonusPayout for each Plan Year, less amounts required by law to be withheld forincome tax and employment tax purposes, shall be paid on or before the end ofthe second month following the end of the Plan Year in which it was earned.

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C.             Establishment of aBonus Bank.  To encourage a long termcommitment to the enhancement of shareholder value by Senior Executives,“Extraordinary Bonus Accruals” shall be credited to an “at risk” deferredaccount (“Bonus Bank”) for each such Participant, and all negative AccruedBonuses shall be charged against the Bonus Bank, as determined in accordance withthe following:

1.               “Bonus Bank”means, with respect to each Senior Executive, a bookkeeping record of anaccount to which Extraordinary Bonus Accruals are credited, and negativeAccrued Bonuses debited as the case may be, for each Plan Year, and from whichbonus payments to such Senior Executive are debited.

2.               “Bank Balance”means, with respect to each Senior Executive, a bookkeeping record of the netbalance of the amounts credited to and debited against such Senior Executive’sBonus Bank.  The Bank Balance shallinitially be equal to zero.

3.               “ExtraordinaryBonus Accrual” shall mean the amount of the Accrued Bonus for any year thatexceeds the Senior Executive’s Target Incentive Award.

4.               AnnualAllocation.  Each Senior Executive’sExtraordinary Bonus Accrual or negative Accrued Bonus is credited or debited tothe Bonus Bank maintained for that Senior Executive or paid to the executive inaccordance with the following rules: (a) if the Bank Balance is zero orpositive when the Extraordinary Bonus Accrual or negative Accrued Bonus iscalculated, 100% of any Extraordinary Bonus Accrual or negative Accrual Bonusshall be credited or debited to the Bank Balance, (b) if the Bank Balance has adeficit that is 50% or less of the Extraordinary Bonus Accrual when the accrualis calculated, the deficit shall be eliminated and the Bank Balance shall becredited with the amount by which the Extraordinary Bonus Accrual exceeds thedeficit, and (c) if the Bank Balance has a deficit that is more than 50% of theExtraordinary Bonus Accrual when the accrual is calculated, 50% of theExtraordinary Bonus Accrual shall be applied to reduce the deficit and 50%shall be paid directly to the Senior Executive. Such Annual Allocation will occur as soon as possible after the conclusionof each Plan Year.  Although a Bonus Bankmay as a result of negative Accrual Bonuses have a deficit, the deficit maynever exceed one times a Senior Executive’s Target Incentive Award for the mostrecently completed Plan Year, and no Senior Executive shall be required, at anytime, to reimburse his/her Bonus Bank for such deficit other than by creditingan Extraordinary Bonus Accrual to a deficit balance.

5.               “AvailableBalance” means that the Bank Balance at the point in time immediately afterthe Annual Allocation has been made.

6.               “PayoutPercentage” means the percentage of the Available Balance that may be paidout in cash to the Participant.  ThePayout Percentage will equal 33%.

7.               “Bank Payout”means the amount of the Available Balance that may be paid out in cash to theSenior Executive for each Plan Year.  TheBank Payout is calculated as follows:

Bank Payout   =  Available Balance  X Payout Percentage

The Bank Payout issubtracted from the Bank Balance.

8.               Treatment ofAvailable Balance Upon Termination

a)              Resignation orTermination With Cause.  SeniorExecutives leaving voluntarily to accept employment elsewhere (includingself-employment) or who are terminated with cause will forfeit their AvailableBalance.

b)             Retirement, Death,Disability or Termination Without Cause. In the event of a Senior Executive’s normal or early retirement underthe Company’s retirement plan, death, disability, or termination without cause,the Available Balance, less amounts required by law to be withheld for incometax and employment tax purposes, shall be paid to the Senior Executive on orbefore the end of the second month following the end of the Plan Year in whichthe termination for one of such events occurred.

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c)              Forpurposes of this Plan “cause” shall mean:

(i)             any act or acts ofthe Participant constituting a felony under the laws of the United States, anystate thereof or any foreign jurisdiction;

(ii)          any material breach bythe Participant of any employment agreement with the Company or the policies ofthe Company or the willful and persistent (after written notice to theParticipant) failure or refusal of the Participant to comply with any lawfuldirectives of the Board;

(iii)       a course of conductamounting to gross neglect, willful misconduct or dishonesty; or

(iv)      any misappropriation ofmaterial property of the Company by the Participant or any misappropriation ofa corporate or business opportunity of the Company by the Participant.

IX.        AdministrativeProvisions

A.           Amendments.  The Board of Directors of the Company shallhave the right to modify or amend this Plan from time to time, or suspend it orterminate it entirely; provided that no such modification, amendment,suspension, or termination may, without the consent of any affectedparticipants (or beneficiaries of such participants in the event of death),reduce the rights of any such participants (or beneficiaries, as applicable) toa payment or distribution already earned under Plan terms in effect prior tosuch change.

B.             Interpretation ofPlan.  Any decision of the Committeewith respect to any issues concerning individual selected for awards, theamount, terms, form and time of payment of awards, and interpretation of anyPlan guideline, definition, or requirement shall be final and binding.

C.             Effect of Award onOther Employee Benefits.  Byacceptance of a bonus award, each recipient agrees that such award is specialadditional compensation and that it will not affect any employee benefit, e.g.,life insurance, etc., in which the recipient participates, except as providedin paragraph D. below.

D.            Retirement Programs.  Awards made under this Plan shall be includedin the employee’s compensation for purposes of the Company Retirement Plans andSavings Plan.

E.              Right toContinued Employment; Additional Awards. The receipt of a bonus award shall not give the recipient any right tocontinued employment, and the right and power to dismiss any employee isspecifically reserved to the Company.  Inaddition, the receipt of a bonus award with respect to any Plan Year shall notentitle the recipient to an award with respect to any subsequent Plan Year.

F.              Adjustments toPerformance Goals.  When aperformance goal is based on Economic Value Added or other quantifiablefinancial or accounting measure, it may be necessary to exclude significantnonbudgeted or noncontrollable capital investments or gains or losses fromactual financial results in order to properly measure performance.  The Committee will decide those items thatshall be considered in adjusting actual results.  For example, some types of items that may beconsidered for exclusion are:

(1)          Any gains or losseswhich will be treated as extraordinary in the Company’s financial statements.

(2)          Profits or losses of anyentities acquired by the Company during the Plan Year, assuming they were notincluded in the budget and/or the goal.

(3)          Material gains or lossesnot in the budget and/or the goal which are of a nonrecurring nature and arenot considered to be in the ordinary course of business.  Some of these would be as follows:

(a)          Gains or losses from thesale or disposal of real estate or property.

(b)         Gains resulting frominsurance recoveries when such gains relate to claims filed in prior years.

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(c)          Losses resulting fromnatural catastrophes, when the cause of the catastrophe is beyond the controlof the Company and did not result from any failure or negligence on theCompany’s part.

(4)   Capital incurred for a majoracquisition for a reasonable period following such acquisition.

G.             Vesting.  All amounts due but unpaid to any Participantunder this plan shall vest, subject to the terms of this EVA Plan, upon actualtermination of employment of the Participant.

X.            Miscellaneous

A.           Indemnification.  Each person who is or who shall have been amember of the Committee or of the Board, or who is or shall have been anemployee of the Company, shall not be liable for, and shall be indemnified andheld harmless by the Company from any loss, cost, liability, or expense thatmay be imposed upon or reasonably incurred by him or her in connection with anyclaim, action, suit, or proceeding to which he or she may be a party by reasonof any action taken or failure to act under this Plan.  The foregoing right of indemnification shallnot be exclusive of any other rights of indemnification to which such personsmay be entitled under the Company’s Articles of Incorporation or Bylaws, as amatter of law, or otherwise, or any power that the Company may have toindemnify them or hold them harmless.

B.             Expenses of thePlan.  The expenses of administeringthis Plan shall be borne by the Company.

C.             Withholding Taxes.  The Company shall have the right to deductfrom all payments under this Plan any Federal or state taxes required by law tobe withheld with respect to such payments.

D.            Governing Law.  This Plan shall be construed in accordancewith and governed by the laws of the State of Wisconsin.

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