Document:

Exhibit 10.1

 

EXECUTION VERSION

 

PARENT SHAREHOLDER VOTING AGREEMENT

 

This Parent Shareholder Voting Agreement (this “Agreement”) is entered into as of December 18, 2016, among Allied World Assurance Company Holdings, AG, a corporation limited by shares organized under the laws of Switzerland (the “Company”), and the shareholders of Fairfax Financial Holdings Limited, a corporation existing under the laws of Canada (“Parent”), on the signature pages hereto (each a “Shareholder” and, collectively, the “Shareholders”).  Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Merger Agreement (as defined herein).

 

RECITALS

 

WHEREAS, concurrently with the execution and delivery of this Agreement, the Company and Parent are entering into an Agreement and Plan of Merger (as the same may be amended or supplemented, the “Merger Agreement”), which provides, among other things, for the acquisition of the Company by Parent by means of an exchange offer by Bid Sub for all of the Company Common Shares followed by a merger of the Company with and into Merger Sub (the “Merger”), all on the terms and subject to the conditions set forth in the Merger Agreement;

 

WHEREAS, each Shareholder beneficially owns (as such term is defined in Rule 13d-3 of under the Exchange Act) the number of Parent Shares and multiple voting shares of Parent (“Multiple Voting Shares”) set forth across from such Shareholder’s name on Exhibit A hereto (such securities, as they may be adjusted by stock split, stock dividend, reverse stock split, reclassification, recapitalization or other similar transaction of or by Parent, together with securities of Parent that may be acquired after the date hereof by such Shareholder are collectively referred to herein as the “Securities”); and

 

WHEREAS, as an inducement and a condition to the willingness of the Company to enter into the Merger Agreement, and in consideration of the expenses incurred and to be incurred by them in connection therewith, each Shareholder has agreed to enter into, be legally bound by and perform this Agreement.

 

AGREEMENTS

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:

 

1.             Covenants of the Shareholders. Each Shareholder agrees as follows:

 

(a)           Each Shareholder shall not, directly or indirectly, after the date hereof and prior to the receipt of the Parent Shareholder Approval (i) sell, transfer (including by operation of law), assign or otherwise dispose of any of the Securities to, or enter into any agreement, option or other arrangement (including any profit sharing arrangement) or understanding with respect to any of the Securities with, any Person, (ii) deposit any Securities into a voting trust or enter into any voting arrangement, whether by proxy, voting agreement, voting trust, power-of-attorney, attorney-in-fact, agent or otherwise, with respect to the Securities, except as contemplated by this Agreement, or (iii) take any other action with the knowledge and intent that it would in any way

 

 

make any representation or warranty of such Shareholder herein untrue or incorrect in any material respect or otherwise restrict, limit or interfere in any material respect with the performance of such Shareholder’s obligations hereunder; in each case, except for any transfer of Shares by either Shareholder to Affiliates, immediate family members, a trust established for the benefit of such Shareholder and/or for the benefit of one or more members of such Shareholder’s immediate family or charitable organizations or upon the death of such Shareholder; provided that as a condition to such transfer, the recipient agrees to be bound by this Agreement.

 

(b)           Each Shareholder hereby agrees that such Shareholder shall (i) execute the Parent Shareholder Written Consent or (ii) if Parent is required to hold a Parent Shareholder Meeting pursuant to the terms of the Merger Agreement, at any such meeting or at any adjournment or postponement thereof or in any other circumstances upon which a vote, consent or other approval (including by written consent) is sought with respect to the Parent Share Issuance, each Shareholder shall vote (or cause to be voted) its Securities in favor of the adoption and approval of the Parent Share Issuance.

 

(c)           Each Shareholder shall (i) attend, if applicable, the Parent Shareholder Meeting, or any adjournment or postponement thereof, and (ii) take, or cause to be taken, all reasonable actions to do or cause to be done, and to assist and cooperate with the Company and Parent in doing, all things reasonably necessary to, if Parent is required to hold a Parent Shareholder Meeting pursuant to the terms of the Merger Agreement, cause Parent to call the Parent Shareholder Meeting for the purpose of seeking the authorization and approval of the Parent Share Issuance; provided, however ̧ that nothing in this Agreement shall require such Shareholder to take any action (or not take any action) in respect of Parent, or cause Parent to take any action (or not take any action), not otherwise contemplated by the terms of the Merger Agreement.

 

2.             Representations and Warranties of the Shareholders.  Each Shareholder jointly and severally hereby represents and warrants to the Company as follows:

 

(a)           Such Shareholder has all necessary power and authority to enter into this Agreement and to perform such Shareholder’s obligations under this Agreement.  The execution, delivery and performance of this Agreement by such Shareholder have been duly and validly authorized by such Shareholder.  This Agreement has been duly executed and delivered by each Shareholder and (assuming the due authorization, execution and delivery by the Company) constitutes a valid and binding obligation of such Shareholder, enforceable against such Shareholder in accordance with its terms, except to the extent enforcement is limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights and to general equitable principles (whether considered in a proceeding at law or in equity).

 

(b)           The Securities and the certificates (or any book-entry notations used to represent any uncertificated Parent Shares) representing the Securities are now, and at all times during the term hereof will be, held by such Shareholder, or by a nominee or custodian for the benefit of such Shareholder, and such Shareholder has title to the Securities, free and clear of all encumbrances, except as provided by this Agreement and other than the agreement dated August 31, 2015 between Parent and the Shareholders (the “MVS Agreement”).  As of the date of this

 

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Agreement, such Shareholder owns of record or beneficially no Parent Share, Multiple Voting Share or any other share capital of, or any other equity interests in, Parent, other than the Securities set forth across from such Shareholder’s name on Exhibit A hereto and other than Parent Shares owned by FFHL Share Option 1 Corp. for purposes of Parent’s and its Subsidiaries share option plans.  Such Shareholder has full power to vote the Securities as provided herein.

 

(c)           Neither the execution, delivery and performance of this Agreement by such Shareholder nor compliance by such Shareholder with any of the terms or provisions hereof will (i) trigger any rights of first refusal, preemptive rights, preferential purchase or similar rights, (ii) violate or conflict with any Law applicable to such Shareholder or any of its Securities, (iii) result in the creation of any lien, pledge, security interest, charge or other encumbrance upon the Securities or (iv) require the consent, approval, Order or authorization of, waiver from, or registration, declaration, notice or filing with any Governmental Entity, except, with respect to clauses (i) through (iii), for any such triggers, violations, conflicts or other occurrences that would not, or would not reasonably be expected to, prevent or materially impair or delay the ability of such Shareholder to perform its obligations hereunder.

 

(d)           Such Shareholder understands and acknowledges that the Company is entering into the Merger Agreement in reliance upon such Shareholder’s execution and delivery of this Agreement.

 

(e)           The information relating to such Shareholder and its Affiliates provided by or on behalf of such Shareholder or its Affiliates for inclusion in the Proxy Statement or the Parent Registration Statement will not (i) on the date the Proxy Statement or any amendment or supplement thereto is first mailed to the shareholders of the Company, (ii) at the time of the Company Shareholder Meeting, and (iii) at the time the Parent Registration Statement or any amendment or supplement thereto becomes effective, contain, with respect to information supplied by such Shareholder, any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  Each Shareholder authorizes and agrees to permit the Company to publish and disclose in the Proxy Statement and any Other Company Filings such Shareholder’s identity and ownership of Securities and the nature of its commitments, arrangements and understandings under this Agreement and any other information required by applicable Law.

 

(f)            There is no Action pending against or threatened in writing against such Shareholder or any of its Affiliates or Representatives which, if determined or resolved adversely in accordance with the plaintiff’s or claimant’s demands, would reasonably be expected to prevent or materially delay the ability of such Shareholder to perform its obligations hereunder.

 

3.             Representations and Warranties of the Company.      The Company hereby represents and warrants to each Shareholder as follows: (a) the Company has all requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder; (b) the execution, delivery and performance of this Agreement by the Company has been duly authorized by all necessary corporate action on the Company’s part and no other corporate proceedings on its part are necessary to authorize this Agreement; and (c) this Agreement has been duly executed and delivered by the Company and (assuming the due

 

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authorization, execution and delivery by each of the Shareholders) constitutes a valid and binding obligation of it, enforceable against it in accordance with its terms, except to the extent enforcement is limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights and to general equitable principles (whether considered in a proceeding at law or in equity).

 

4.             Further Assurances.  If, at any time before the Acceptance Time, the Company reasonably believes or is advised that any further instruments, deeds, assignments or assurances are reasonably necessary or desirable to effectively carry out such Shareholder’s obligations under this Agreement, then each Shareholder shall execute and deliver all such proper instruments, deeds, assignments or assurances and do all other things reasonably necessary or desirable to effectively carry out such Shareholder’s obligations under this Agreement.

 

5.             Assignment; Binding Effect.  Neither this Agreement nor any of the rights, interests or obligations of the parties hereunder shall be assigned by any of the parties (whether by operation of Law or otherwise) without the prior written consent of the other parties, which may be granted or withheld in the sole discretion of the other parties.  Any attempt to make any such assignment without such consent shall be null and void.  Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and permitted assigns.  No assignment or purported assignment of this Agreement by any party hereto shall be valid if and to the extent such assignment causes the Offer and the Merger to fail to qualify as a “reorganization” within the meaning of Section 368(a) of the Code and the Treasury Regulations promulgated thereunder.

 

6.             Termination.  This Agreement, and all rights and obligations of the parties hereunder, shall terminate upon the first to occur (such date, the “Termination Date”) of (a) the Acceptance Time, (b) the date on which the Merger Agreement is terminated in accordance with its terms or (c) the mutual written agreement of the parties to terminate this Agreement.  In the event of termination of this Agreement pursuant to this Section 6, this Agreement will become null and void and of no effect with no liability on the part of any party hereto; provided, however, that (i) Section 5, this Section 6 and Section 8 shall survive any such termination, and (ii) no such termination will relieve any party hereto from any liability for any fraud or willful and material breach of this Agreement occurring prior to such termination.  For purposes of this Agreement, “willful and material breach” means a deliberate act or a deliberate failure to act, which act or failure to act constitutes in and of itself a material breach of this Agreement.

 

7.             Shareholder Capacity.  Notwithstanding anything to the contrary in this Agreement, the parties acknowledge that (a) each Shareholder is entering into this Agreement solely in such Shareholder’s capacity as a registered and/or beneficial owner of the Securities and not in such Shareholder’s capacity as a director, officer or employee of Parent (if applicable) or in such Shareholder’s capacity as a trustee or fiduciary of any Parent Benefit Plans and (b) nothing in this Agreement is intended to restrict or affect any action or inaction of such Shareholder or any representative of such Shareholder, as applicable, serving on Parent’s board of directors or on the board of directors of any Subsidiary of Parent or as an officer or fiduciary of Parent or any Subsidiary of Parent, acting in such person’s capacity as a director, officer, employee or fiduciary of Parent or any Subsidiary of Parent.

 

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8.             General Provisions.

 

(a)           Expenses.  Except as otherwise set forth in the Merger Agreement, all Expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such Expense, whether or not the transactions contemplated hereby are consummated.

 

(b)           Waiver.  At any time before the Parent Shareholder Approval is obtained, the parties may, to the extent legally allowed, (i) extend the time for the performance of any of the obligations or other acts of the other party, (ii) waive any breach of the representations or warranties contained herein or in any document delivered pursuant hereto or (iii) waive compliance with any of the covenants, agreements or conditions contained herein.  Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in a written instrument signed on behalf of such party.  The failure of a party to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of those rights.  No single or partial exercise of any right, remedy, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  Any waiver shall be effective only in the specific instance and for the specific purpose for which given and shall not constitute a waiver to any subsequent or other exercise of any right, remedy, power or privilege hereunder.

 

(c)           Notices.  All notices and other communications hereunder shall be in writing and shall be deemed duly given (i) on the date of delivery if delivered personally, (ii) when received when sent by email or facsimile by the party to be notified, provided, however, that notice given by email or facsimile shall not be effective unless either (x) a duplicate copy of such email is confirmed by facsimile, or such facsimile is confirmed by email or (y) the receiving party delivers a written confirmation of receipt for such notice either by email or facsimile or any other method described in this Section 8(c), or (iii) when delivered by a courier (with confirmation of delivery).

 

All notices hereunder shall be delivered as set forth below or under such other instructions as may be designated in writing by the party to receive such notice.

 

If to the Company, to:

 

Allied World Assurance Company Holdings, AG

199 Water Street, 24th Floor

New York, NY 10038

Attention:              Wesley D. Dupont

Facsimile:              646-794-0613

Email:                    Wesley.Dupont@awac.com

 

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with a copy to (which shall not constitute notice):

 

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, New York 10019

Phone:                   (212) 728-8832

Attention:              Steven A. Seidman, Esq.

Sean M. Ewen, Esq.

Facsimile:              (212) 728-9867

Email:                    sseidman@willkie.com

sewen@willkie.com

 

If to a Shareholder:

 

c/o Fairfax Financial Holdings Limited

Suite 800

95 Wellington Street West

Toronto, Ontario M5J 2N7

Attention:              V. Prem Watsa

Facsimile:              416-367-2201

 

(d)           Interpretation and Rules of Construction.  The parties have participated jointly in negotiating and drafting this Agreement.  If an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.  When a reference is made in this Agreement to sections or subsections, such reference shall be to a section or subsection of this Agreement unless otherwise indicated.  The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”  The words “herein,” “hereof,” “hereunder” and words of similar import shall be deemed to refer to this Agreement as a whole and not to any particular provision of this Agreement.  Any pronoun shall include the corresponding masculine, feminine and neuter forms.  References to “party” or “parties” in this Agreement mean the Company and each Shareholder, as the case may be.  Time periods within or following which any act is to be done shall be calculated by excluding the day on which the period commences and including the day on which the period ends and by extending the period to the next Business Day following if the last day of the period is not a Business Day.

 

(e)           Entire Agreement; Amendment.  This Agreement taken together with the Merger Agreement constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof.

 

(f)            Amendment.  This Agreement may be amended by the parties, by action taken or authorized by their respective boards of directors, at any time before or after receipt of the Parent Shareholder Approval.

 

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(g)           Governing Law.  This Agreement shall be governed, including as to validity, interpretation and effect, by the laws of the Province of Ontario and the laws of Canada applicable therein, and shall be construed and treated in all respects as an Ontario contract. Each of the parties hereby irrevocably attorns to the non-exclusive jurisdiction of the Courts of the Province of Ontario in respect of all matters arising under and in relation to this Agreement.

 

(h)           Waiver of Jury Trial.  EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS.  EACH OF THE PARTIES HERETO HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8(H).

 

(i)            Severability.  Any term or provision of this Agreement that is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability and, unless the effect of such invalidity or unenforceability would prevent the parties from realizing a material portion of the economic benefits of the Merger that they currently anticipate obtaining therefrom, shall not render invalid or unenforceable the remaining terms and provisions of this Agreement or affect the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction.  If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as is enforceable.

 

(j)            Specific Performance.  The parties agree that money damages would be both incalculable and an insufficient remedy and that irreparable damage would occur if any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.  It is accordingly agreed that each of the parties shall be entitled to specific performance, an injunction or other equitable relief to prevent breaches or violations of this Agreement and to enforce specifically the terms and provisions of this Agreement in the Courts of the Province of Ontario, this being in addition to any other remedy to which they are entitled at law or in equity.  Moreover, and in recognition of the foregoing, each of the parties hereby waives (a) any defense in any action for specific performance of this Agreement that a remedy at law would be adequate or that a remedy of specific performance is unenforceable, invalid, contrary to Law or inequitable for any reason and (b) any requirement under any law for any party to post security as a prerequisite to obtaining equitable relief.

 

(k)           Counterparts.  This Agreement may be executed in separate counterparts, each of which shall be considered one and the same agreement and shall become effective when each of the parties has delivered a signed counterpart to the other parties, it being understood that all parties need not sign the same counterpart.  Delivery of an executed signature page of this

 

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Agreement by facsimile transmission or electronic “.pdf” shall be effective as delivery of a manually executed counterpart hereof.

 

[Signature pages follow]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

 

	
 
    	
ALLIED WORLD ASSURANCE   COMPANY HOLDINGS, AG
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Wesley D.   Dupont
    
	
 
    	
 
    	
Name:
    	
Wesley D. Dupont
    
	
 
    	
 
    	
Title:
    	
Executive Vice   President & General Counsel
    

 

[Voting Agreement]

 

 

	
 
    	
V. PREM WATSA
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ V. Prem Watsa
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
THE SIXTY TWO INVESTMENT   COMPANY LIMITED
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ V. Prem Watsa
    
	
 
    	
 
    	
Name:
    	
V. Prem Watsa
    
	
 
    	
 
    	
Title:
    	
President
    

 

[Voting Agreement]

 

 

Exhibit A

 

Shareholder Security Ownership

 

	
 
    	
 
    	
 
    	
 
    	
Number of Securities
    	
 
    
	
 
    	
 
    	
Name of Shareholder
    	
 
    	
Beneficially Owned by Shareholder
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
1.
    	
 
    	
V. Prem Watsa
    	
 
    	
260,368 Parent Shares
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
2.
    	
 
    	
The Sixty Two   Investment Company Limited
    	
 
    	
50,620 Parent Shares
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
1,548,000 Multiple Voting Shares
    	
 
    

 

[Voting Agreement]EX-10.1

 Exhibit 10.1 
 GENERAL MILLS, INC. 
 2016 COMPENSATION PLAN FOR NON-EMPLOYEE DIRECTORS 
  

	1.	PURPOSE 

 The purpose of
the Plan is to provide a compensation program which will attract and retain qualified individuals not employed by General Mills, Inc. (the “Company”) and its subsidiaries to serve on the Board of Directors of the Company (the
“Board”) and to further align the interests of non-employee directors with those of the stockholders by providing that a portion of compensation will be linked directly to increases in stockholder
value. 
  

	2.	EFFECTIVE DATE, DURATION OF PLAN 

 This Plan shall become effective as of September 27, 2016 subject to the approval of the Plan by the stockholders. Awards may be made under the Plan until September 30, 2026 or such earlier date
as determined by the Board or the Compensation Committee of the Board (the “Committee”); provided that no such termination shall affect rights earned or accrued under the Plan prior to the date of termination. 

 

	3.	DEFINITIONS 

 Wherever
used in this Plan, the following terms have the meanings set forth below: 
 “Board” has the meaning set forth
in Section 1. 
 “Business Day” means a day on which the New York Stock Exchange is open for trading.

 “Change of Control” has the meaning set forth in Section 10. 

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

“Committee” has the meaning set forth in Section 2. 

“Common Stock” means Company common stock ($.10 par value per share). 

“Company” has the meaning set forth in Section 1. 

“Deferred Compensation Account” has the meaning set forth in Section 6(d). 

“Election Form” means a written form provided by the Company pursuant to which a Participant may elect the form and
timing of distributions with respect to his or her retainer, Stock Units and dividend equivalents under the Plan. 

“Fair Market Value” means the closing price on the New York Stock Exchange of the Common Stock on the applicable date
(or the preceding Business Day if the applicable date is not a Business Day). 
 “Key Employee” means a
Participant treated as a “specified employee” as of his Separation from Service under Code Section 409A(a)(2)(B)(i), i.e., a key employee (as defined in Code Section 416(i) without regard to paragraph (5) thereof) of the Company or
its affiliates if the Company’s or its affiliate’s stock is publicly traded on an established securities market or otherwise. Key Employees shall be determined in accordance with Code Section 409A using a December 31 identification
date. A listing of Key Employees as of an identification date shall be effective for the 12-month period beginning on the April 1 following the identification date. 

”Option” has the meaning set forth in Section 7(a). 

“Participant” has the meaning set forth in Section 4. 

“Plan” means the General Mills, Inc. 2016 Compensation Plan for Non-Employee
Directors as set forth herein and as amended. 
 “Plan Year” has the meaning set forth in Section 6(a).

 “Separation from Service” or “Separate from Service” means
a “separation from service” within the meaning of Code Section 409A. 
 ”Stock Unit Account” has the
meaning set forth in Section 8(a). 
 “Stock Units” has the meaning set forth in Section 8(a). 

 

	4.	PARTICIPATION 

 Each
member of the Board who is not an employee of the Company at the date compensation is granted, earned or accrued shall be eligible to participate in the Plan (a “Participant”). 

 

	5.	COMMON STOCK SUBJECT TO THE PLAN 

 (a) General. The Common Stock to be issued under this Plan is to be made available from the authorized but unissued Common Stock, shares of Common Stock held in the treasury or Common Stock
purchased on the open market or otherwise. The maximum aggregate number of shares authorized to be issued under the Plan shall be 500,000. Upon forfeiture, expiration or termination of Options or Stock Units, the shares of Common Stock subject
thereto shall again be available for awards under the Plan. 
 (b) Adjustments for Corporate Transactions. If a corporate
transaction has occurred affecting the Common Stock such that an adjustment to outstanding awards is required to preserve (or prevent enlargement of) the benefits or potential benefits intended at the time of grant, then in such manner as the
Committee deems equitable, an appropriate adjustment shall be made to: (i) the number and kind of shares which may be awarded under the Plan; (ii) the number and kind of shares subject to outstanding awards, provided that the number of
shares of Common Stock subject to any Option shall always be a whole number; (iii) the number of shares credited to a Stock Unit Account; and (iv) the exercise price of outstanding Options. For this purpose a corporate transaction
includes, but is not limited to, any dividend (other than a cash dividend that is not an extraordinary cash dividend) or other distribution (whether in the form of cash, Common Stock, securities of a subsidiary of the Company, other securities or
other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of
Common Stock or other securities of the Company, issuance of warrants or other rights to purchase Common Stock or other securities of the Company, or other similar corporate transaction. Notwithstanding anything in this Section to the contrary,
an adjustment to an Option under this Section 5(b) shall be made in a manner that will not result in the grant of a new Option under Code Section 409A. 
  

	6.	RETAINER 

 (a)
General. Each Participant shall be entitled to receive a retainer with respect to each Board term, beginning the day of each annual stockholders’ meeting and ending the day before the succeeding annual stockholders’ meeting (the
“Plan Year”) in an amount determined from time to time by the Board or its delegate. Retainers shall be earned and paid at the end of each of the Company’s fiscal quarters. A Participant elected to the Board at any time other than the
commencement of a Plan Year shall be entitled to receive a full quarter retainer payment beginning in the fiscal quarter the Participant’s election to the Board is effective. 

(b) Normal Payment Terms. The normal payment terms for retainers are cash in a lump sum. In the absence of an affirmative election
to the contrary, the retainer (or the portion not subject to such elections) shall be paid within 10 Business Days following the last day of each quarterly period described above in (a). 

(c) Deferral Elections. Each Participant may elect an alternative form (lump sum vs. installments) in which a retainer may be
delivered and the timing for such delivery, pursuant to the terms of Section 9. Participants shall make such election by filing an irrevocable Election Form with the Company before the calendar year in which a Plan Year begins. The election
shall apply to amounts earned in each quarterly period described in (a) above that begins during the Plan Year. Notwithstanding the foregoing, in the first Plan Year in which an individual becomes a Participant, an election may be made with
respect to services to be performed subsequent to the election, to the extent permitted under Code Section 409A. Such an election must be made on an Election Form within 30 days after the date the non-employee
director becomes eligible to participate in the Plan. 
 (d) Deferred Cash Alternative. For each Participant who
affirmatively elects to defer receipt of his or her retainers in the form of deferred cash, the Company shall establish a separate account (a “Deferred Compensation Account”) and credit such deferred cash compensation into that account as
of the date the amounts would otherwise be paid. A separate Deferred Compensation Account shall be established for each Plan Year a Participant makes such a deferral election. Earnings, gains and losses shall be credited to each such Deferred
Compensation Account based on the rate earned by the fund or funds selected by the Participant from among funds or portfolios established by the Company, in its discretion. Distributions from a Deferred Compensation Account shall be made in
accordance with Section 9. 

 The Company has established a Supplemental Benefits Trust with Wells Fargo Bank Minnesota,
N.A. as trustee to hold assets of the Company under certain circumstances as a reserve for the discharge of the Company’s obligations as to Deferred Compensation Accounts under the Plan and certain other deferred compensation plans of the
Company. In the event of a Change of Control, the Company shall be obligated to immediately contribute such amounts to the trust as may be necessary to fully fund all Deferred Compensation Accounts payable under the Plan. Any Participant in the Plan
shall have the right to demand and secure specific performance of this provision. All assets held in the trust remain subject only to the claims of the Company’s general creditors whose claims against the Company are not satisfied because of
the Company’s bankruptcy or insolvency (as those terms are defined in the trust agreement). No Participant has any preferred claim on, or beneficial ownership interest in, any assets of the trust before the assets are paid to the Participant
and all rights created under the trust, as under the Plan, are unsecured contractual claims of the Participant against the Company. 
 (e) Common Stock Alternative. Each Participant may affirmatively elect to receive all or a specified percentage of his or her retainer for a Plan Year in shares of Common Stock, which, if elected,
will be issued within 10 Business Days following the last day of each quarterly period during the Plan Year described above in (a). Only whole numbers of shares will be issued, with any fractional share amounts paid in cash. For purposes of
computing the number of shares earned each quarter during the Plan Year, the value of each share shall be equal to the Fair Market Value on the third Business Day preceding the last day of each quarter described above in (a). 

(f) Death. Notwithstanding any other provision of the Plan, if a Participant dies during a Plan Year, the balance of the amount
due for the quarter in which death occurs shall be payable in full under the terms of Section 11(b) of this Plan in cash within 60 days following the date of death. 
 (g) Compensation Cap. The aggregate fair market value of all compensation granted to any Participant under this Plan and any other compensatory plan or arrangement of the Company shall not exceed
$800,000 during any Plan Year; provided, however, that compensation paid to any Participant designated as chair of the Board shall not be subject to the foregoing limitation. For purposes of calculating the value of
non-cash compensation paid to a Participant, all stock-based awards shall be valued at the grant date fair value as determined by the Company for financial statement purposes and all other non-cash compensation shall be valued at fair market value as reasonably determined by the Committee. 
  

	7.	NON-QUALIFIED STOCK OPTIONS 

 (a) Grant of Options. A Participant may be awarded an option (an “Option”) to purchase shares of Common Stock in an amount determined from time to time by the Board or its delegate. All
Options granted under the Plan shall be non-statutory options not entitled to special tax treatment under Code Section 422. 
 (b) Option Exercise Price. The per share price to be paid by the Participant at the time an Option is exercised shall be greater than or equal to the Fair Market Value on the date of grant.

 (c) Term of Option. Each Option shall expire no later than ten (10) years after the date of grant, as determined
by the Board or its delegate. 
 (d) Exercise and Vesting of Option. Each Option will vest on the date specified by the
Board or its delegate. Upon vesting, a Participant shall be given the full term to exercise the Option without regard to whether he or she continues to serve on the Board. If a Participant ceases to serve on the Board prior to the date an Option
vests, such Option shall be forfeited and all further rights of the Participant with respect to such Option shall terminate. Notwithstanding the foregoing, if a participant should die during his or her term of service on the Board, any vested Option
may be exercised by the person(s) designated under the terms of Section 11(b) of this Plan, and any unvested Options shall fully vest and become exercisable upon death for the remainder of the Option’s full term. 

(e) Method of Exercise. A Participant exercising an Option shall give notice to the Company of such exercise and of the number of
shares elected to be purchased prior to 4:30 P.M. CST/CDT on the day of exercise. The exercise price shall be paid to the Company at the time of such exercise, subject to any applicable rule adopted by the Committee: 

 

	 	(i)	in cash (including check, draft, money order or wire transfer made payable to the order of the Company); 

 

	 	(ii)	through the tender of shares of Common Stock owned by the Participant (by either actual delivery or attestation); or 

 

	 	(iii)	by a combination of (i) and (ii) above; or 

 (iv) by authorizing a third party broker to sell a sufficient number of shares of Common Stock acquired upon exercise of the Stock Option and remitting to the Company such sales proceeds to pay the entire
exercise price. 

 To determine the amount of the payment, Common Stock delivered pursuant to (ii) or (iii) above shall
have a value equal to the Fair Market Value of the Common Stock on the date of exercise. 
 (f) Non-transferability. Except as provided by rule adopted by the Committee, an Option shall be non-assignable and non-transferable by
a Participant other than by will or the laws of descent and distribution. A Participant shall forfeit any Option assigned or transferred, voluntarily or involuntarily, other than as permitted under this subsection. 

(g) No Reload Rights. No Option granted under this Plan shall contain any provision entitling the Participant to the automatic
grant of additional Options in connection with any exercise of the original Option. 
 (h) No Repricing. Subject to
Section 5(b) and absent stockholder approval, the exercise price of an outstanding Option may not be decreased after the grant date; no outstanding Options may be surrendered to the Company as consideration or otherwise for the grant of a new Option
with a lower exercise price, any other award or cash; and no other modifications to any outstanding Options may be made that would be treated as a “repricing” under the then applicable rules or listing requirements adopted by the New York
Stock Exchange. 
  

	8.	STOCK UNITS 

 (a)
Awards. On the effective date of the Plan (or, if a Participant is first elected after the effective date of the Plan, then on the date the Participant first attends a Board meeting) and at the close of business on each successive annual
stockholders’ meeting, each Participant who is re-elected to the Board shall be awarded the right to receive shares of Common Stock (“Stock Units”) in an amount determined from time to time by
the Board or its delegate, subject to vesting as provided in Section 8(b). Only a Participant who is re-elected to the Board shall be entitled to a grant under this Section 8(a) of Stock Units awarded at the
close of business on an annual meeting date after the date of the original grant to Participants. A separate “Stock Unit Account” will be established for the Participant each time an award of Stock Units is made. 

Participants receiving Stock Units will have no rights as stockholders of the Company with respect to allocations made to their Stock
Unit Account(s), except the right to receive dividend equivalent allocations under Section 8(d). 
 Stock Units may not be sold,
transferred, assigned, pledged or otherwise encumbered or disposed of until such time as share certificates for Common Stock are issued to the Participants. 
 (b) Vesting of Stock Units. Except as otherwise specified by the Board or its delegate at the time of grant, a Participant’s interest in the Stock Units shall vest on the earlier of
(i) date of the annual stockholders’ meeting next following the grant date of the Stock Units and (ii) the date 13 months after the grant date of the Stock Units. If a Participant ceases to serve on the Board prior to the date the
Participant’s interest in a grant of Stock Units vests, such Stock Units shall be forfeited and all further rights of the Participant to or with respect to such Stock Units shall terminate. Notwithstanding the foregoing, a Participant who dies
while serving on the Board prior to the vesting of Stock Units shall fully vest in such Stock Units, effective as of the date of death, and the Stock Units shall be paid pursuant to Section 11(b) of this Plan. 

(c) Election Concerning Receipt of Common Stock. Each Participant receiving an award of Stock Units under Section 8(a) may elect
the time and form (lump sum vs. installments) of distribution of Common Stock and dividend equivalents attributable to such Stock Units, pursuant to the terms of Section 9. If no affirmative election is made, all Stock Units shall be paid in
shares of Common Stock, and dividend equivalents shall be paid in cash, within 10 days following vesting. 
 (d) Dividend
Equivalents. As of the first day of each quarter, during the applicable restricted period for all Stock Units awarded hereunder, the Company shall credit to each Participant an amount equal to the value of all dividends and other distributions
(whether in cash or other property) paid by the Company during the prior quarter on the equivalent number of shares of Common Stock. Any dividend equivalents or other distributions credited with respect to Stock Units shall be distributed in cash
(with or without interest or other earnings, as provided at the discretion of the Committee) to the Participant only if, when and to the extent such Stock Units vest. The value of dividends and other distributions payable with respect to Stock Units
that do not vest shall be forfeited. 
 (e) Timing of Elections. In order to make an election under Section 8(c) with
respect to Stock Units awarded for a Plan Year, a Participant shall file an irrevocable Election Form with the Committee before the calendar year in which the Plan Year begins. Notwithstanding the foregoing, in the first year Plan Year in which an
individual becomes a Participant, an election may be made with respect to services to be performed subsequent to the election, to the extent permitted under Code Section 409A. Such an election must be made on an Election Form within 30 days after
the date the non-employee director becomes eligible to participate in the Plan. The Election Form shall indicate whether the Participant directs the value of any dividend equivalents accrued on Stock Units to
be paid in cash or reinvested in additional Stock Units. 
  

	9.	DISTRIBUTION PROVISIONS FOR DEFERRED CASH AND STOCK UNITS 

 The following distribution provisions shall apply to Deferred Compensation Accounts and
Stock Unit Accounts: 
 (a) Timing. Distributions from Deferred Compensation Accounts shall normally commence at
Separation from Service, however, a Participant may affirmatively elect a specified date for commencement, provided said date is not later than age 75. The same rule applies to Stock Units which have been deferred beyond the vesting period described
in Section 8(b). Elections as to the timing of benefit commencement shall be made in accordance with Sections 6 and 8, as appropriate. 
 Notwithstanding the above or any other provision of this Plan, distributions may not be made to a Key Employee upon a Separation from Service before the date which is six months after the date of the Key
Employee’s Separation from Service (or, if earlier, the date of death of the Key Employee). Any payments that would otherwise be made during this period of delay shall be accumulated and paid on the first day of the seventh month following the
Participant’s Separation from Service (or, if earlier, the first day of the month after the Participant’s death). 

(b) Form of Distribution. Distributions shall normally be made in a lump sum. However, a Participant may affirmatively elect to
receive substantially equal annual installments over a period of up to 10 years. Such elections shall be made in accordance with Sections 6 and 8, as appropriate. 
 (c) Manner of Distribution. Amounts credited to Deferred Compensation Accounts shall be paid in cash. Amounts credited to Stock Unit Accounts shall be paid in Common Stock based on the number of
Stock Units credited to the Stock Unit Account and paid in cash equal to any dividend equivalent amounts which had not been elected to purchase additional Stock Units. 
 (d) Distribution Upon Death. Notwithstanding any elections by a Participant or provisions of the Plan to the contrary, if a Participant dies before full distribution of a Deferred Compensation
Account or Stock Unit Account, such accounts shall be distributed under the terms of Section 11(b) of this Plan in a lump sum within 60 days following the date of death. 
 (e) Permitted Payment Delay To Avoid Violations of Law. Notwithstanding any provision of this Plan to the contrary, any distribution to a Participant under the Plan shall be delayed upon the
Committee’s reasonable anticipation that the making of the payment would violate Federal securities laws or other applicable law; provided, that any payment delayed pursuant to this Section 9(e) shall ultimately be paid in accordance with Code
Section 409A. 
 (f) Payment Acceleration. If amounts deferred under the Plan must be included in a Participant’s
income under Code Section 409A prior to the scheduled distribution of such amounts, distribution of such amount shall be made immediately to the Participant. 
  

	10.	CHANGE OF CONTROL 

 (a)
Notwithstanding any other provision of this Plan to the contrary, if during the Plan Year in which a Change of Control occurs a Participant, at the request of the Company or its stockholders, resigns or is otherwise replaced, removed or dismissed
from the Board, then all Options and Stock Units held by the Participant shall fully and immediately vest, and for Options, shall be exercisable and, for Stock Units, shall be paid immediately if the Participant experiences a “separation from
service” under Code Section 409A, pursuant to the terms of the Plan that are otherwise applicable. A “Change of Control” means: 
 (i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) (a
“Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of voting securities of the Company where such acquisition causes such Person to own 20% or more of
the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Voting Securities”); provided, however, that for purposes of this subsection (i),
the following acquisitions shall not be deemed to result in a Change of Control: (A) any acquisition directly from the Company; (B) any acquisition by the Company; (C) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the Company; or (D) any acquisition by any corporation pursuant to a transaction that complies with clauses (A), (B) and (C) of subsection (iii) below; and
provided, further, that if any Person’s beneficial ownership of the Outstanding Voting Securities reaches or exceeds 20% as a result of a transaction described in clause (A) or (B) above, and such Person subsequently acquires beneficial
ownership of additional voting securities of the Company, such subsequent acquisition shall be treated as an acquisition that causes such Person to own 20% or more of the Outstanding Voting Securities; or 

(ii) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to
constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or 

 (iii) Consummation of a reorganization, merger, statutory share exchange or
consolidation or similar transaction involving the Company or any of its subsidiaries, sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity by the Company or any
of its subsidiaries, (each, a “Business Combination”); excluding, however, such a Business Combination pursuant to which: (A) all or substantially all of the individuals and entities who were the beneficial owners of the Outstanding
Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 60% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company
or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Voting
Securities; (B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation
except to the extent that such ownership existed prior to the Business Combination; and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or 
 (iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company. 
 (b) If, in the event of a Change of Control, and to the extent outstanding Options or Stock Units are not assumed by a successor corporation (or its affiliate) or other successor entity or person, or
replaced with an award or grant that solely in the discretionary judgment of the Committee, which shall be reasonable, preserves the existing value of outstanding Options and Stock Units at the time of the Change of Control, then the following shall
occur: 
 (i) Subject to the other provisions of this subsection (b), all Options shall vest and become exercisable immediately
upon the Change of Control event; 
 (ii) All Stock Units shall vest immediately; 

(iii) To the extent Code Section 409A applies, if the Change of Control constitutes a “change in control” event as described
in IRS regulations or other guidance under Code section 409A(a)(2)(A)(v), Participants’ Stock Units shall be settled and paid immediately upon the Change of Control in accordance with the requirements of Code Section 409A. 

(iv) If the Change of Control does not constitute a “change in control” event as described in IRS regulations or other
guidance under Code Section 409A(a)(2)(A)(v), Stock Units that are not otherwise subject to Section 409A, and on which a deferral election was not made, shall be settled and paid immediately upon the Change of Control. The Stock Units subject to
Section 409A shall be settled in cash equal to either the Fair Market Value of such Stock Units at the time of the Change of Control, plus interest at the prime rate plus 1% from the Change of Control to the date of payment, which shall be the date
the original restriction period would have closed or the date elected pursuant to the proper deferral election, as applicable. 

In the discretion of the Committee and notwithstanding subsection (b)(i) above or any other Plan provision, outstanding Options (both
exercisable and unexercisable) may be cancelled at the time of the Change of Control in exchange for cash, property or a combination thereof that is determined by the Committee to be at least equal to the excess (if any) of the value of the
consideration that would be received in such Change of Control by the holders of Common Stock over the exercise price for such Options. For purposes of clarification, by operation of this provision Options that would not yield a gain at the time of
the Change of Control under the aforementioned equation are subject to cancellation without consideration. Furthermore, the Committee is under no obligation to treat Options or Participants uniformly and has the discretionary authority to treat
Options and Participants disparately. 
 (c) If in the event of a Change of Control and to the extent outstanding Options and
Stock Units are assumed by any successor corporation, affiliate thereof, person or other entity, or are replaced with awards that, solely in the discretionary judgment of the Committee preserve the existing value of outstanding Options and Stock
Units at the time of the Change of Control and provide for vesting payout terms that are at least as favorable to Participants as vesting and payout terms applicable to Options and Stock Units, then all such Options and Stock Units or such
substitutes thereof shall remain outstanding and be governed by their respective terms, subject to Section 10(a). 
  

	11.	ADMINISTRATION 

 (a) The
Plan shall be administered by the Committee. The Committee shall have full discretionary power and authority to administer and manage the operations of the Plan, and to interpret the terms of the Plan, formulate additional rules and policies for
carrying out terms and provisions of the Plan, and amend, modify or terminate the Plan as from time to time it deems proper and in the best interests of the Company. No amendment, modification or termination of the Plan shall alter or impair the
rights of any Participant pursuant to an 

 
outstanding award hereunder in any material respect without the consent of the Participant. Any decision or interpretation adopted by the Committee shall be final and conclusive. 

(b) Each Participant may designate a beneficiary or beneficiaries to exercise any Option or to receive any payment which under the terms
of the Plan may become exercisable or payable on or after the Participant’s death. At any time, and from time to time, any such designation may be changed or cancelled by the Participant without the consent of any such beneficiary. Any such
designation, change or cancellation must be on a form provided for that purpose by the Committee and shall not be effective until received by the Committee. Such form may establish other rules as the Committee deems appropriate. If no beneficiary
has been properly designated by a deceased Participant, or if all the designated beneficiaries have predeceased the Participant, the beneficiary shall be the Participant’s estate. If the Participant designates more than one beneficiary, any
Options shall be divided among beneficiaries equally, and any payments under the Plan to such beneficiaries shall be made in equal shares, unless the Participant has expressly designated otherwise, in which case such Options shall be divided, and
the payments shall be made, in the portions designated by the Participant. 
  

	12.	GOVERNING LAW 

 The
validity, construction and effect of the Plan and any such actions taken under or relating to the Plan shall be determined in accordance with the laws of the State of Delaware and applicable Federal law. 

 

	13.	NOTICES 

 Unless
otherwise notified, all notices under this Plan shall be sent in writing to the Company, attention Corporate Compensation, P.O. Box 1113, Minneapolis, Minnesota 55440. All correspondence to a Participant shall be sent to the address recorded on
an Election Form or as otherwise provided by the Participant in writing. 
  

	14.	PLAN TERMINATION 

 Upon
termination of the Plan, distribution of Deferred Compensation Accounts and Stock Unit Accounts shall be made as described in Section 9, unless the Committee determines in its sole discretion that all such amounts shall be distributed upon
termination in accordance with the requirements under Code Section 409A. Upon termination of the Plan, no further deferrals of retainers or Stock Units, or additional accruals of Stock Units through dividend reinvestment on deferred Stock Units,
shall be permitted; however, earnings, gains and losses shall continue to be credited to the Deferred Compensation Account balances in accordance with Section 6 until the Deferred Compensation Account balances are fully distributed. 

 

	15.	COMPLIANCE WITH CODE SECTION 409A 

 It is intended that this Plan shall comply with the provisions of Code Section 409A and the Treasury regulations relating thereto so as not to subject the Participants to the payment of additional taxes
and interest under Code Section 409A. In furtherance of this intent, this Plan shall be interpreted, operated and administered in a manner consistent with these intentions.

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