QuickLinks
 -- Click here to rapidly navigate through this document

Exhibit 10.15  


 
 

GANDER MOUNTAIN COMPANY
  2004 Omnibus Stock Plan    
    


As
approved by the shareholders on

                        , 2004 


        1.    Purpose.    The purpose of the Gander Mountain Company 2004 Omnibus Stock Plan (the
"Plan") is to promote the interests of the Company and its shareholders by providing key personnel of the Company and its Affiliates with an opportunity
to acquire a proprietary interest in the Company and reward them for achieving a high level of performance and thereby develop a stronger incentive to put forth maximum effort for the continued
success and growth of the Company and its Affiliates. In addition, the opportunity to acquire a proprietary interest in the Company will aid in attracting and retaining key personnel of outstanding
ability. The Plan is also intended to provide Outside Directors with an opportunity to acquire a proprietary interest in the Company, to compensate Outside Directors, consultants and advisors for
their contribution to the Company and to aid in attracting and retaining Outside Directors and qualified consultants and advisors. 


        2.    Definitions.    



        2.1   The
capitalized terms used elsewhere in the Plan have the meanings set forth below. 



        (a)   "Affiliate" means any corporation that is a "parent corporation" or "subsidiary corporation" of the Company, as those
terms are defined in Code Sections 424(e) and (f), or any successor provisions. 


        (b)   "Agreement" means a written contract (i) consistent with the terms of the Plan entered into between the Company or
an Affiliate and a Participant and (ii) containing the terms and conditions of an Award in such form and not inconsistent with the Plan as the Committee shall approve from time to time,
together with all amendments thereto, which amendments may be unilaterally made by the Company (with the approval of the Committee) unless such amendments are deemed by the Committee to be materially
adverse to the Participant and not required as a matter of law. 


        (c)   "Award" or "Awards" means a grant made under the Plan in the form of
Restricted Stock, Options, Stock Appreciation Rights, Performance Units, Stock or any other stock-based award. 


        (d)   "Board" means the Board of Directors of the Company. 


        (e)   "Code" means the Internal Revenue Code of 1986, as amended and in effect from time to time or any successor statute. 


        (f)    "Committee" means two or more Non-Employee Directors designated by the Board to administer the Plan under
Section 3.1 of the Plan and constituted so as to permit grants thereby to comply with Exchange Act Rule 16b-3 and Code Section 162(m). 







 


        (g)   "Company" means Gander Mountain Company, a Minnesota corporation, or any successor to all or substantially all of its
businesses by merger, consolidation, purchase of assets or otherwise. 


        (h)   "Effective Date" means the date specified in Section 12.1 of the Plan. 


        (i)    "Employee" means an employee (including an officer or director who is also an employee) of the Company or an Affiliate. 


        (j)    "Exchange Act" means the Securities Exchange Act of 1934, as amended and in effect from time to time or any successor
statute. 


        (k)   "Exchange Act Rule 16b-3" means Rule 16b-3 promulgated by the Securities and
Exchange Commission under the Exchange Act, as now in force and in effect from time to time or any successor regulation. 


        (l)    "Fair Market Value" as of any date means, unless otherwise expressly provided in the Plan: 



          (i)  the
closing sale price of a Share on the date of grant, or, if no sale of Shares shall have occurred on that date, on the next preceding day on which a sale of Shares
occurred 



        (A)  on
the composite tape for New York Stock Exchange listed shares, or 


        (B)  if
the Shares are not quoted on the composite tape for New York Stock Exchange listed shares, on the principal United States Securities Exchange registered under the
Exchange Act on which the Shares are listed, or 


        (C)  if
the Shares are not listed on any such exchange, on the National Association of Securities Dealers, Inc. Automated Quotations National Market System or any
system then in use, or 




         (ii)  if
clause (i) is inapplicable, the mean between the closing "bid" and the closing "asked" quotation of a Share on the date immediately preceding that date, or,
if no closing bid or asked quotation is made on that date, on the next preceding day on which a closing bid and asked quotation is made, on the National Association of Securities Dealers, Inc.
Automated Quotations System or any system then in use, or 


        (iii)  if
clauses (i) and (ii) are inapplicable, what the Committee determines in good faith to be 100% of the fair market value of a Share on that date, using
such criteria as it shall determine, in its sole discretion, to be appropriate for valuation. 




        However,
if the applicable securities exchange or system has closed for the day at the time the event occurs that triggers a determination of Fair Market Value, whether the grant of an
Award, the exercise of an Option or Stock Appreciation Right or 




2





 


otherwise,
all references in this paragraph to the "date immediately preceding that date" shall be deemed to be references to "that date." In the case of an Incentive Stock Option, if this
determination of Fair Market Value is not consistent with the then current regulations of the Secretary of the Treasury, Fair Market Value shall be determined in accordance with those regulations. The
determination of Fair Market Value shall be subject to adjustment as provided in Section 16 of the Plan. 



        (m)  "Fundamental Change" means a dissolution or liquidation of the Company, a sale of substantially all of the assets of the
Company, a merger or consolidation of the Company with or into any other corporation, regardless of whether the Company is the surviving corporation, or a statutory share exchange involving capital
stock of the Company. 


        (n)   "Incentive Stock Option" means any Option designated as such and granted in accordance with the requirements of Code
Section 422 or any successor provision. 


        (o)   "Insider" as of a particular date means any person who, as of that date is an officer of the Company as defined under
Exchange Act Rule 16a-1(f) or its successor provision. 


        (p)   "Non-Employee Director" means a member of the Board who is considered a non-employee director
within the meaning of Exchange Act Rule 16b-3(b)(3) or its successor provision and an outside director for purposes of Code Section 162(m). 



        (q)   "Non-Statutory Stock Option" means an Option other than an Incentive Stock Option. 


        (r)   "Option" means a right to purchase Stock, including both Non-Statutory Stock Options and Incentive Stock
Options. 


        (s)   "Outside Director" means a director who is not an Employee. 


        (t)    "Participant" means a person or entity to whom an Award is or has been made in accordance with the Plan. 



        (u)   "Performance Cycle" means the period of time as specified in an Agreement over which Performance Units are to be earned. 


        (v)   "Performance Units" means an Award made pursuant to Section 11 of the Plan. 


        (w)  "Plan" means this Gander Mountain Company 2004 Omnibus Stock Plan, as may be amended and in effect from time to time. 



        (x)   "Restricted Stock" means Stock granted under Section 7 of the Plan so long as such Stock remains subject to one or
more restrictions. 




3





 


        (y)   "Section 16" or "Section 16(b)" means Section 16 or
Section 16(b), respectively, of the Exchange Act or any successor statute and the rules and regulations promulgated thereunder as in effect and as amended from time to time. 


        (z)   "Share" means a share of Stock. 


        (aa) "Stock" means the Series B Nonvoting Common Stock, par value $.01 per share, of the Company. 


        (bb) "Stock Appreciation Right" means a right, the value of which is determined in relation to the appreciation in value of
Shares pursuant to an Award granted under Section 10 of the Plan. 


        (cc) "Subsidiary" means a "subsidiary corporation," as that term is defined in Code Section 424(f) or any successor
provision. 


        (dd) "Successor" with respect to a Participant means the legal representative of an incompetent Participant, and if the
Participant is deceased the estate of the Participant or the person or persons who may, by bequest or inheritance, or pursuant to the terms of an Award, acquire the right to exercise an Option or
Stock Appreciation Right or to receive cash and/or Shares issuable in satisfaction of an Award in the event of the Participant's death. 



        (ee) "Term" means the period during which an Option or Stock Appreciation Right may be exercised or the period during which
the restrictions or terms and conditions placed on Restricted Stock or any other Award are in effect. 


        (ff)  "Transferee" means any member of the Participant's immediate family
(i.e., his or her children, step-children, grandchildren and spouse) or one or more trusts for the benefit of such family members or
partnerships in which such family members are the only partners. 




        2.2    Gender and Number.    Except when otherwise indicated by the context, reference to the masculine gender shall
include, when used, the feminine gender and any term used in the singular shall also include the plural. 




        3.    Administration and Indemnification.    



        3.1    Administration.    



        (a)   The
Committee shall administer the Plan. The Committee shall have exclusive power to (i) make Awards, (ii) determine when and to whom Awards will be
granted, the form of each Award, the amount of each Award, and any other terms or conditions of each Award consistent with the Plan, and (iii) determine whether, to what extent and under what
circumstances, Awards may be settled, paid or exercised in cash, Shares or other Awards, or other property or canceled, forfeited or suspended. Each Award shall be subject to an Agreement authorized
by the Committee. A majority of the members of the Committee shall constitute a quorum for any meeting of the Committee, and acts of a majority of the members present at any meeting at which a quorum
is present or the acts unanimously approved in writing by all members of the Committee 




4





 


shall
be the acts of the Committee. Notwithstanding the foregoing, the Board shall have the sole and exclusive power to administer the Plan with respect to Awards granted to Outside Directors and,
except to the extent that the grant or exercise of such authority would cause any Award or transaction to become subject to (or lose an exemption under) the short-swing profit recovery provisions of
Section 16 of the Exchange Act, the Board may, at any time and from time to time, without any further action of the Committee, exercise the powers and duties of the Committee under the Plan. To
the extent that any permitted action taken by the Board conflicts with action taken by the Committee, the Board action will control. 


        (b)   Solely
for purposes of determining and administering Awards to Participants who are not Insiders, the Committee may delegate all or any portion of its authority under
the Plan to one or more persons who are not Non-Employee Directors. 


        (c)   To
the extent within its discretion and subject to Sections 15 and 16 of the Plan, other than price, the Committee may amend the terms and conditions of any outstanding
Award. 


        (d)   It
is the intent that the Plan and all Awards granted pursuant to it shall be administered by the Committee so as to permit the Plan and Awards to comply with Exchange
Act Rule 16b-3, except in such instances as the Committee, in its discretion, may so provide. If any provision of the Plan or of any Award would otherwise frustrate or conflict with
the intent expressed in this Section 3.1(d), that provision to the extent possible shall be interpreted and deemed amended in the manner determined by the Committee so as to avoid the conflict.
To the extent of any remaining irreconcilable conflict with this intent, the provision shall be deemed void as applicable to Insiders to the extent permitted by law and in the manner deemed advisable
by the Committee. 


        (e)   The
Committee's interpretation of the Plan and of any Award or Agreement made under the Plan and all related decisions or resolutions of the Board or Committee shall be
final and binding on all parties with an interest therein. Consistent with its terms, the Committee shall have the power to establish, amend or waive regulations to administer the Plan. In carrying
out any of its responsibilities, the Committee shall have discretionary authority to construe the terms of the Plan and any Award or Agreement made under the Plan. 




        3.2    Indemnification.    Each person who is or shall have been a member of the Committee, or of the Board, and any
other person to whom the Committee delegates authority under the Plan, shall be indemnified and held harmless by the Company, to the extent permitted by law, against and from any loss, cost, liability
or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit or proceeding to which such person may be a party or in which
such person may be involved by reason of any action taken or failure to act, made in good faith, under the Plan and against and from any and all amounts paid by such person in settlement thereof, with
the Company's approval, or paid by such person in satisfaction of any judgment in any such action, suit or proceeding against such person, provided such person shall give the Company an opportunity,
at the Company's expense, to handle and defend the same before such person undertakes to handle and defend it on such person's own behalf. The foregoing right of indemnification shall not be exclusive
of any other rights of indemnification to which such person or persons may be entitled 



5





 

under
the Company's Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless. 




        4.    Shares Available Under the Plan.    




        (a)   The
number of Shares available for distribution under the Plan shall not exceed 67,000 (subject to adjustment pursuant to Section 16 of the Plan). 


        (b)   Any
Shares subject to the terms and conditions of an Award under the Plan that are not used because the terms and conditions of the Award are not met may again be used
for an Award under the Plan; provided however, that Shares with respect to which a Stock Appreciation Right has been exercised whether paid in cash and/or in Shares may not again be awarded under the
Plan. 


        (c)   Any
unexercised or undistributed portion of any terminated, expired, exchanged, or forfeited Award, or any Award settled in cash in lieu of Shares (except as provided in
Section 4(b) of the Plan) shall be available for further Awards. 


        (d)   For
the purposes of computing the total number of Shares granted under the Plan, the following rules shall apply to Awards payable in Shares where appropriate: 



          (i)  each
Option shall be deemed to be the equivalent of the maximum number of Shares that may be issued upon exercise of the particular Option; 


         (ii)  an
Award (other than an Option) payable in some other security shall be deemed to be equal to the number of Shares to which it relates; 


        (iii)  where
the number of Shares available under the Award is variable on the date it is granted, the number of Shares shall be deemed to be the maximum number of Shares
that could be received under that particular Award; and 


        (iv)  where
two or more types of Awards (all of which are payable in Shares) are granted to a Participant in tandem with each other, such that the exercise of one type of
Award with respect to a number of Shares cancels at least an equal number of Shares of the other, each such joint Award shall be deemed to be the equivalent of the maximum number of Shares available
under the largest single Award. 




        Additional
rules for determining the number of Shares granted under the Plan may be made by the Committee as it deems necessary or desirable. 



        (e)   No
fractional Shares may be issued under the Plan; however, cash shall be paid in lieu of any fractional Share in settlement of an Award. 


        (f)    The
maximum number of Shares that may be awarded to a Participant in any calendar year in the form of Options is 33,333 and the maximum number of Shares that may be
awarded to a Participant in any calendar year in the form of Stock Appreciation Rights is 33,333. 




6





 





        5.    Eligibility.    Participation in the Plan shall be limited to Employees and to individuals or entities who are
not Employees but who provide services to the Company or an Affiliate, including services provided in the capacity of a consultant, advisor or director. The granting of Awards is solely at the
discretion of the Committee, except that Incentive Stock Options may only be granted to Employees. References herein to "employed," "employment" or similar terms (except "Employee") shall include the
providing of services in any capacity or as a director or director emeritus. Neither the transfer of employment of a Participant between any of the Company or its Affiliates, nor a leave of absence
granted to such Participant and approved by the Committee, shall be deemed a termination of employment for purposes of the Plan. 


        6.    General Terms of Awards.    



        6.1    Amount of Award.    Each Agreement shall set forth the number of Shares of Restricted Stock, Stock or
Performance Units subject to the Agreement, or the number of Shares to which the Option subject to the Agreement applies or with respect to which payment upon the exercise of the Stock Appreciation
Right subject to the Agreement is to be determined, as the case may be, together with such other terms and conditions applicable to the Award as determined by the Committee acting in its sole
discretion. 


        6.2    Term.    Each Agreement, other than those relating solely to Awards of Shares without restrictions, shall set
forth the Term of the Option, Stock Appreciation Right, Restricted Stock or other Award or the Performance Cycle for the Performance Units, as the case may be. Acceleration of the expiration of the
applicable Term is permitted, upon such terms and conditions as shall be set forth in the Agreement, which may, but need not, include, without limitation, acceleration in the event of the
Participant's death or retirement. Acceleration of the Performance Cycle of the Performance Units will be subject to Section 11.2 of the Plan. 


        6.3    Transferability.    Except as provided in this Section, during the lifetime of a Participant to whom an Award
is granted, only that Participant (or that Participant's legal representative) may exercise an Option or Stock Appreciation Right, or receive payment with respect to Performance Units or any other
Award. No Award of Restricted Stock (before the expiration of the restrictions), Options, Stock Appreciation Rights, Performance Units or other Award may be sold, assigned, transferred, exchanged or
otherwise encumbered other than to a Successor in the event of a Participant's death or pursuant to a qualified domestic relations order as defined in the Code or Title 1 of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or the rules thereunder; any attempted transfer in violation of this Section 6.3 shall be of
no effect. Notwithstanding the immediately preceding sentence, the Committee, in an Agreement or otherwise at its discretion, may provide that the Award (other than Incentive Stock Options) may be
transferable to a Transferee if the Participant does not receive any consideration for the transfer. Any Award held by a Transferee shall continue to be subject to the same terms and conditions that
were applicable to that Award immediately before the transfer thereof to the Transferee. For purposes of any provision of the Plan relating to notice to a Participant or to acceleration or termination
of an Award upon the death, disability or termination of employment of a Participant, the references to "Participant" shall mean the original grantee of an Award and not any Transferee. 


        6.4    Termination of Employment.    Except as otherwise determined by the Committee or provided by the Committee in
an Agreement, in case of a Participant's termination of employment, the following provisions shall apply: 



7





 


        (a)    Options and Stock Appreciation Rights.    



          (i)  If
a Participant's employment or other relationship with the Company and its Affiliates terminates because of the Participant's death, then any Option or Stock
Appreciation Right that has not expired or been terminated shall remain exercisable for one year after Participant's death, but, unless otherwise provided in the Agreement, only to the extent that
such Option or Stock Appreciation Right was exercisable immediately prior to Participant's death. 


         (ii)  If
a Participant's employment or other relationship with the Company and its Affiliates terminates because the Participant is disabled (within the meaning of
Section 22(e)(3) of the Code), then any Option or Stock Appreciation Right that has not expired or been terminated shall remain exercisable for one year after Participant's termination of
employment resulting from Participant's disability, but, unless otherwise provided in the Agreement, only to the extent that such Option or Stock Appreciation Right was exercisable immediately prior
to such Participant's termination of employment resulting from Participant's disability. 


        (iii)  If
a Participant's employment terminates for any reason other than death or disability, then any Option or Stock Appreciation Right that has not expired or been
terminated shall remain exercisable for three months after termination of the Participant's employment or Participant's cessation of service as an Outside Director or director emeritus, whichever
occurs later, but, unless otherwise provided in the Agreement, only to the extent that such Option or Stock Appreciation Right was exercisable immediately prior to such Participant's termination of
employment or ceasing to be an Outside Director or director emeritus. 


        (iv)  Notwithstanding
Sections 6.4(a)(i), (ii) and (iii) of the Plan, in no event shall an Option or a Stock Appreciation Right be exercisable after the
expiration of the Term of such Award. Any Option or Stock Appreciation Right that is not exercised within the periods set forth in Sections 6.4 (i), (ii) and (iii) of the Plan, except as
otherwise provided by the Committee in the Agreement, shall terminate as of the end of the periods described in such Sections. 




        (b)    Performance Units.    If a Participant's employment or other relationship with the Company and its Affiliates
terminates during a Performance Cycle because of death or disability, or under other circumstances provided by the Committee in its discretion in the Agreement or otherwise, the Participant, unless
the Committee shall otherwise provide in the Agreement, shall be entitled to a payment with respect to the Performance Units at the end of the Performance Cycle based upon the extent to which
achievement of performance targets was satisfied at the end of such period (as determined at the end of the Performance Cycle) and prorated for the portion of the Performance Cycle during which the
Participant was employed by the Company or its Affiliates. Except as provided in this Section 6.4(b) or in the Agreement, if a Participant's employment or other relationship with the Company
and its Affiliates terminates during a Performance Cycle, then such Participant shall not be entitled to any payment with respect to that Performance Cycle. 




8





 


        (c)    Restricted Stock Awards.    Unless otherwise provided in the Agreement, in case of a Participant's death or
disability, the Participant shall be entitled to receive a number of Shares of Restricted Stock under outstanding Awards that has been prorated for the portion of the Term of the Awards during which
the Participant was employed by the Company and its Affiliates, and, with respect to such Shares, all restrictions shall lapse. Any Shares of Restricted Stock as to which restrictions do not lapse
under the preceding sentence shall terminate at the date of the Participant's termination of employment and such Shares of Restricted Stock shall be forfeited to the Company. 




        6.5    Rights as Shareholder.    Each Agreement shall provide that a Participant shall have no rights as a shareholder
with respect to any securities covered by an Award unless and until the date the Participant becomes the holder of record of the Stock, if any, to which the Award relates. 




        7.    Restricted Stock Awards.    




        (a)   An
Award of Restricted Stock under the Plan shall consist of Shares subject to restrictions on transfer and conditions of forfeiture, which restrictions and conditions
shall be included in the applicable Agreement. The Committee may provide for the lapse or waiver of any such restriction or condition based on such factors or criteria as the Committee, in its sole
discretion, may determine. 


        (b)   Except
as otherwise provided in the applicable Agreement, each Stock certificate issued with respect to an Award of Restricted Stock shall either be deposited with the
Company or its designee, together with an assignment separate from the certificate, in blank, signed by the Participant, or bear such legends with respect to the restricted nature of the Restricted
Stock evidenced thereby as shall be provided for in the applicable Agreement. 


        (c)   The
Agreement shall describe the terms and conditions by which the restrictions and conditions of forfeiture upon awarded Restricted Stock shall lapse. Upon the lapse of
the restrictions and conditions, Shares free of restrictive legends, if any, relating to such restrictions shall be issued to the Participant or a Successor or Transferee. 


        (d)   A
Participant or a Transferee with a Restricted Stock Award shall have all the other rights of a shareholder including, but not limited to, the right to receive
dividends and the right to vote the Shares of Restricted Stock. 


        (e)   No
more than 33,000 of the total number of Shares available for Awards under the Plan shall be issued during the term of the Plan as Restricted Stock. This limitation
shall be calculated pursuant to the applicable provisions of Sections 4 and 16 of the Plan. 





        8.    Other Awards.    The Committee may from time to time grant Stock and other Awards under the Plan including,
without limitation, those Awards pursuant to which Shares are or may in the future be acquired, Awards denominated in Stock units, securities convertible into Stock and phantom securities. The
Committee, in its sole discretion, shall determine the terms and conditions of such Awards provided that such Awards shall not be inconsistent with the terms and purposes of the Plan. The Committee
may, at its sole discretion, direct the Company to issue Shares subject to restrictive 


9





 

legends
and/or stop transfer instructions that are consistent with the terms and conditions of the Award to which the Shares relate. No more than 16,750 of the total number of Shares available for
Awards under the Plan shall be issued during the term of the Plan in the form of Stock without restrictions. 


        9.    Stock Options.    



        9.1    Terms of All Options.    



        (a)   An
Option shall be granted pursuant to an Agreement as either an Incentive Stock Option or a Non-Statutory Stock Option. The purchase price of each Share
subject to an Option shall be determined by the Committee and set forth in the Agreement, but shall not be less than 100% of the Fair Market Value of a Share as of the date the Option is granted
(except as provided in Sections 9.2 and 19 of the Plan or as otherwise determined by the Committee in its discretion). 



        (b)   The
purchase price of the Shares with respect to which an Option is exercised shall be payable in full at the time of exercise, provided that to the extent permitted by
law, the Agreement may permit some or all Participants to simultaneously exercise Options and sell the Shares thereby acquired pursuant to a brokerage or similar relationship and use the proceeds from
the sale as payment of the purchase price of the Shares. The purchase price may be payable in cash, by delivery or tender of Shares having a Fair Market Value as of the date the Option is exercised
equal to the purchase price of the Shares being purchased pursuant to the Option, or a combination thereof, as determined by the Committee, but no fractional Shares will be issued or accepted.
Provided, however, that a Participant exercising a stock option shall not be permitted to pay any portion of the purchase price with Shares if, in the opinion of the Committee, payment in such manner
could have adverse financial accounting consequences for the Company. 


        (c)   The
Committee may provide, in an Agreement or otherwise, that a Participant who exercises an Option and pays the Option price in whole or in part with Shares then owned
by the Participant will be entitled to receive another Option covering the same number of shares tendered and with a price of no less than Fair Market Value on the date of grant of such additional
Option ("Reload Option"). Unless otherwise provided in the Agreement, a Participant, in order to be entitled to a Reload Option, must pay with Shares
that have been owned by the Participant for at least the preceding 180 days. 


        (d)   Each
Option shall be exercisable in whole or in part on the terms provided in the Agreement. In no event shall any Option be exercisable at any time after the expiration
of its Term. When an Option is no longer exercisable, it shall be deemed to have lapsed or terminated. 




10





 




        9.2    Incentive Stock Options.    In addition to the other terms and conditions applicable to all Options: 



        (a)   the
purchase price of each Share subject to an Incentive Stock Option shall not be less than 100% of the Fair Market Value of a Share as of the date the Incentive Stock
Option is granted if this limitation is necessary to qualify the Option as an Incentive Stock Option (except as provided in Section 19 of the Plan); 



        (b)   the
aggregate Fair Market Value (determined as of the date the Option is granted) of the Shares with respect to which Incentive Stock Options held by an individual first
become exercisable in any calendar year (under the Plan and all other incentive stock option plans of the Company and its Affiliates) shall not exceed $100,000 (or such other limit as may be required
by the Code) if this limitation is necessary to qualify the Option as an Incentive Stock Option and to the extent any Option granted to a Participant exceeds this limit the Option shall be treated as
a Non-Statutory Stock Option; 



        (c)   an
Incentive Stock Option shall not be exercisable more than 10 years after the date of grant (or such other limit as may be required by the Code) if this
limitation is necessary to qualify the Option as an Incentive Stock Option; 


        (d)   the
Agreement covering an Incentive Stock Option shall contain such other terms and provisions that the Committee determines necessary to qualify this Option as an
Incentive Stock Option; and 


        (e)   notwithstanding
any other provision of the Plan to the contrary, no Participant may receive an Incentive Stock Option under the Plan if, at the time the Award is
granted, the Participant owns (after application of the rules contained in Code Section 424(d), or its successor provision), Shares possessing more than 10% of the total combined voting power
of all classes of stock of the Company or its Subsidiaries, unless (i) the option price for that Incentive Stock Option is at least 110% of the Fair Market Value of the Shares subject to that
Incentive Stock Option on the date of grant and (ii) that Option is not exercisable after the date five years from the date that Incentive Stock Option is granted. 





        10.    Stock Appreciation Rights.    An Award of a Stock Appreciation Right shall entitle the Participant (or a
Successor or Transferee), subject to terms and conditions determined by the Committee, to receive upon exercise of the Stock Appreciation Right all or a portion of the excess of (i) the Fair
Market Value of a specified number of Shares as of the date of exercise of the Stock Appreciation Right over (ii) a specified price that shall not be less than 100% of the Fair Market Value of
such Shares as of the date of grant of the Stock Appreciation Right. A Stock Appreciation Right may be granted in connection with part or all of, in addition to, or completely independent of an Option
or any other Award under the Plan. If issued in connection with a previously or contemporaneously granted Option, the Committee may impose a condition that exercise of a Stock Appreciation Right
cancels a pro rata portion of the Option with which it is connected and vice versa. Each Stock Appreciation Right may be exercisable in whole or in part on the terms provided in the Agreement. No
Stock Appreciation Right shall be exercisable at any time after the expiration of its Term. When a Stock Appreciation Right is no longer exercisable, it shall be deemed to have lapsed or terminated.
Upon exercise of a Stock Appreciation Right, payment to the Participant or a Successor or Transferee shall be made at such time
or times as shall be provided in the Agreement in the form of cash, Shares or a combination of cash and 


11





 


Shares
as determined by the Committee. The Agreement may provide for a limitation upon the amount or percentage of the total appreciation on which payment (whether in cash and/or Shares) may be made
in the event of the exercise of a Stock Appreciation Right. 


        11.    Performance Units.    



        11.1    Initial Award.    



        (a)   An
Award of Performance Units under the Plan shall entitle the Participant or a Successor or Transferee to future payments of cash, Shares or a combination of cash and
Shares, as determined by the Committee, based upon the achievement of pre-established performance targets. These performance targets may, but need not, include, without limitation, targets
relating to one or more of the Company's or a group's, unit's, Affiliate's or an individual's performance. The Agreement may establish that a portion of a Participant's Award will be paid for
performance that exceeds the minimum target but falls below the maximum target applicable to the Award. The Agreement shall also provide for the timing of the payment. 



        (b)   Following
the conclusion or acceleration of each Performance Cycle, the Committee shall determine the extent to which (i) performance targets have been attained,
(ii) any other terms and conditions with respect to an Award relating to the Performance Cycle have been satisfied and (iii) payment is due with respect to an Award of Performance Units. 




        11.2    Acceleration and Adjustment.    The Agreement may permit an acceleration of the Performance Cycle and an
adjustment of performance targets and payments with respect to some or all of the Performance Units awarded to a Participant, upon the occurrence of certain events, which may, but need not include,
without limitation, a Fundamental Change, a recapitalization, a change in the accounting practices of the Company, a change in the Participant's title or employment responsibilities, the Participant's
death or retirement or, with respect to payments in Shares with respect to Performance Units, a reclassification, stock dividend, stock split or stock combination as provided in Plan
Section 16. The Agreement also may provide for a limitation on the value of an Award of Performance Units that a Participant may receive. 




        12.    Effective Date and Duration of the Plan.    



        12.1    Effective Date.    Upon its adoption by the Board, the Plan shall be submitted for approval by the
shareholders of the Company and shall be effective as of the date of such approval. 


        12.2    Duration of the Plan.    The Plan shall remain in effect until all Stock subject to it shall be distributed,
all Awards have expired or lapsed, the Plan is terminated pursuant to Section 15 of the Plan or the tenth anniversary of the Effective Date (the "Termination
Date"); provided, however, that Awards made before the Termination Date may be exercised, vested or otherwise effectuated beyond the Termination Date unless limited in the
Agreement or otherwise. No Award of an Incentive Stock Option shall be made more than 10 years after the Effective Date (or such other limit as may be required by the Code) if this limitation
is necessary to qualify the Option as an Incentive Stock Option. The date and time of approval by the Committee of the granting of an Award shall be considered the date and time at which the Award is
made or granted. 



12





 

        13.    Plan Does Not Affect Employment Status.    




        (a)   Status
as an eligible Employee shall not be construed as a commitment that any Award will be made under the Plan to that eligible Employee or to eligible Employees
generally. 


        (b)   Nothing
in the Plan or in any Agreement or related documents shall confer upon any Employee or Participant any right to continue in the employment of the Company or any
Affiliate or constitute any contract of employment or affect any right that the Company or any Affiliate may have to change such person's compensation, other benefits, job responsibilities, or title,
or to terminate the employment of such person with or without cause. 





        14.    Tax Withholding.    The Company shall have the right to withhold from any cash payment under the Plan to a
Participant or other person (including a Successor or a Transferee) an amount sufficient to cover any required withholding taxes. The Company shall have the right to require a Participant or other
person receiving Shares under the Plan to pay the Company a cash amount sufficient to cover any required withholding taxes before actual receipt of those Shares. In lieu of all or any part of a cash
payment from a person receiving Shares under the Plan, the Committee may permit the individual to cover all or any part of the required withholdings through a reduction of the number of Shares
delivered or delivery or tender return to the Company of Shares held by the Participant or other person, in each case valued in the same manner as used in computing the withholding taxes under the
applicable laws. 


        15.    Amendment, Modification and Termination of the Plan.    




        (a)   The
Board may at any time and from time to time terminate, suspend or modify the Plan. Except as limited in (b) below, the Committee may at any time alter or
amend any or all Agreements under the Plan to the extent permitted by law. 


        (b)   No
termination, suspension, or modification of the Plan will materially and adversely affect any right acquired by any Participant or Successor or Transferee under an
Award granted before the date of termination, suspension, or modification, unless otherwise agreed to by the Participant in the Agreement or otherwise, or required as a matter of law; but it will be
conclusively presumed that any adjustment for changes in capitalization provided for in Section 16 of the Plan does not adversely affect these rights. 





        16.    Adjustment for Changes in Capitalization.    Subject to any required action by the Company's shareholders,
appropriate adjustments, so as to prevent enlargement of rights or inappropriate dilution—(i) in the aggregate number and type of Shares available for Awards under the Plan,
(ii) in the limitations on the number of Shares that may be issued to an individual Participant as an Option or a Stock Appreciation Right in any calendar year or that may be issued in the form
of Restricted Stock or Shares without restrictions, (iii) in the number and type of Shares and amount of cash subject to Awards then outstanding, and (iv) in the Option price as to any
outstanding Options may be made by the Committee in its sole discretion to give effect to adjustments made in the number or type of Shares through a Fundamental Change (subject to Section 17 of
the Plan), recapitalization, reclassification, stock dividend, stock split, stock combination or other relevant change, provided that fractional Shares shall be rounded to the nearest whole Share. 


13





 

        17.    Fundamental Change.    In the event of a proposed Fundamental Change, the Committee may, but shall not be
obligated to: 




        (a)   if
the Fundamental Change is a merger or consolidation or statutory share exchange, make appropriate provision for the protection of the outstanding Options and Stock
Appreciation Rights by the substitution of options, stock appreciation rights and appropriate voting common stock of the corporation surviving any merger or consolidation or, if appropriate, the
parent corporation of the Company or such surviving corporation; or 



        (b)   at
least ten days before the occurrence of the Fundamental Change, declare, and provide written notice to each holder of an Option or Stock Appreciation Right of the
declaration, that each
outstanding Option and Stock Appreciation Right, whether or not then exercisable, shall be canceled at the time of, or immediately before the occurrence of the Fundamental Change in exchange for
payment to each holder of an Option or Stock Appreciation Right, within ten days after the Fundamental Change, of cash equal to (i) for each Share covered by the canceled Option, the amount, if
any, by which the Fair Market Value (as defined in this Section) per Share exceeds the exercise price per Share covered by such Option or (ii) for each Stock Appreciation Right, the price
determined pursuant to Section 10, except that Fair Market Value of the Shares as of the date of exercise of the Stock Appreciation Right, as used in clause (i) of Section 10 of
the Plan, shall be deemed to mean Fair Market Value for each Share with respect to which the Stock Appreciation Right is calculated determined in the manner hereinafter referred to in this Section. At
the time of the declaration provided for in the immediately preceding sentence, each Stock Appreciation Right and each Option shall immediately become exercisable in full and each person holding an
Option or a Stock Appreciation Right shall have the right, during the period preceding the time of cancellation of the Option or Stock Appreciation Right, to exercise the Option as to all or any part
of the Shares covered thereby or the Stock Appreciation Right in whole or in part, as the case may be. In the event of a declaration pursuant to this Section 17(b), each outstanding Option and
Stock Appreciation Right granted pursuant to the Plan that shall not have been exercised before the Fundamental Change shall be canceled at the time of, or immediately before, the Fundamental Change,
as provided in the declaration. Notwithstanding the foregoing, no person holding an Option or a Stock Appreciation Right shall be entitled to the payment provided for in this Section 17(b) if
such Option or Stock Appreciation Right shall have terminated, expired or been cancelled. For purposes of this Section only, "Fair Market Value" per Share means the cash plus the fair market value, as
determined in good faith by the Committee, of the non-cash consideration to be received per Share by the shareholders of the Company upon the occurrence of the Fundamental Change. 





        18.    Forfeitures.    An Agreement may provide that if a Participant has received or been entitled to payment of
cash, delivery of Shares, or a combination thereof pursuant to an Award within six months before the Participant's termination of employment with the Company and its Affiliates, the Committee, in its
sole discretion, may require the Participant to return or forfeit the cash and/or Shares received with respect to the Award (or its economic value as of (i) the date of the exercise of Options
or Stock Appreciation Rights, (ii) the date of, and immediately following, the lapse of restrictions on Restricted Stock or the receipt of Shares without restrictions or (iii) the date
on which the right of the Participant to payment with respect to Performance Units vests, as the case may be) in the event of certain occurrences specified in the Agreement. The Committee's right to
require forfeiture must be 


14





 

exercised
within 90 days after discovery of such an occurrence but in no event later than 15 months after the Participant's termination of employment with the Company and its
Affiliates. The occurrences may, but need not, include competition with the Company or any Affiliate, unauthorized disclosure of material proprietary information of the Company or any Affiliate, a
violation of applicable business ethics policies of the Company or Affiliate or any other occurrence specified in the Agreement within the period or periods of time specified in the Agreement. 


        19.    Corporate Mergers, Acquisitions, Etc.    The Committee may also grant Options, Stock Appreciation Rights,
Restricted Stock or other Awards under the Plan in substitution for, or in connection with the assumption of, existing options, stock appreciation rights, restricted stock or other award granted,
awarded or issued by another corporation and assumed or otherwise agreed to be provided for by the
Company pursuant to or by reason of a transaction involving a corporate merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation to which the Company or a
Subsidiary is a party. The terms and conditions of the substitute Awards may vary from the terms and conditions set forth in the Plan to the extent as the Board at the time of the grant may deem
appropriate to conform, in whole or in part, to the provisions of the awards in substitution for which they are granted. 


        20.    Unfunded Plan.    The Plan shall be unfunded and the Company shall not be required to segregate any assets that
may at any time be represented by Awards under the Plan. Neither the Company, its Affiliates, the Committee, nor the Board of Directors shall be deemed to be a trustee of any amounts to be paid under
the Plan nor shall anything contained in the Plan or any action taken pursuant to its provisions create or be construed to create a fiduciary relationship between the Company and/or its Affiliates,
and a Participant or Successor or Transferee. To the extent any person acquires a right to receive an Award under the Plan, this right shall be no greater than the right of an unsecured general
creditor of the Company. 


        21.    Limits of Liability.    




        (a)   Any
liability of the Company to any Participant with respect to an Award shall be based solely upon contractual obligations created by the Plan and the Award Agreement. 


        (b)   Except
as may be required by law, neither the Company nor any member of the Board of Directors or of the Committee, nor any other person participating in any
determination of any question under the Plan, or in the interpretation, administration or application of the Plan, shall have any liability to any party for any action taken, or not taken, in good
faith under the Plan. 





        22.    Compliance with Applicable Legal Requirements.    No certificate for Shares distributable pursuant to the Plan
shall be issued and delivered unless the issuance of the certificate complies with all applicable legal requirements including, without limitation, compliance with the provisions of applicable state
securities laws, the Securities Act of 1933, as amended and in effect from time to time or any successor statute, the Exchange Act and the requirements of the exchanges on which the Company's Shares
may, at the time, be listed. 


        23.    Deferrals and Settlements.    The Committee may require or permit Participants to elect to defer the issuance
of Shares or the settlement of Awards in cash under such rules and procedures as it may establish under the Plan. It may also provide that deferred settlements include the payment or crediting of
interest on the deferral amounts. 


15





 

        24.    Other Benefit and Compensation Programs.    Payments and other benefits received by a Participant under an
Award made pursuant to the Plan shall not be deemed a part of a Participant's regular, recurring compensation for purposes of the termination, indemnity or severance pay laws of any country and shall
not be included in, nor have any effect on, the determination of benefits under any other employee benefit plan, contract or similar arrangement provided by the Company or an Affiliate unless
expressly so provided by such other plan, contract or arrangement, or unless the Committee expressly determines that an Award or portion of an Award should be included to accurately reflect
competitive compensation practices or to recognize that an Award has been made in lieu of a portion of competitive cash compensation. 


        25.    Beneficiary Upon Participant's Death.    To the extent that the transfer of a Participant's Award at his or her
death is permitted under an Agreement, a Participant's Award shall be transferable at death to the estate or to the person who acquires the right to succeed to the Award by bequest or inheritance. 



        26.    Requirements of Law.    




        (a)   To
the extent that federal laws do not otherwise control, the Plan and all determinations made and actions taken pursuant to the Plan shall be governed by the laws of
the State of Minnesota without regard to its conflicts-of-law principles and shall be construed accordingly. 


        (b)   If
any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not effect the remaining parts of the Plan, and the Plan
shall be construed and enforced as if the illegal or invalid provision had not been included. 




16















QuickLinks


GANDER MOUNTAIN COMPANY 2004 Omnibus Stock Plan