Document:

EXHIBIT 10.3

 

MARTEN TRANSPORT, LTD.

 

PERFORMANCE INCENTIVE BONUS PLAN

 

I.                                         GENERAL

 

A.                                   Plan Purpose. In an effort to maintain a position of
leadership in the highly competitive business segments in which Marten
Transport, Ltd. (the “Company”) competes, it is necessary to promote the financial
interests of the Company and its Subsidiaries, including its growth, by
attracting and retaining highly qualified employees possessing outstanding
ability, motivating such employees by means of performance related incentives,
and providing incentive compensation opportunities which are competitive with
those of similar corporations. The Marten Transport, Ltd. Performance Incentive
Bonus Plan (the “Plan”) is designed to assist the
Company in attaining these objectives.

 

B.                                     Cash Bonus Plan. The Plan is a cash bonus plan and is not
intended to be (and shall not be construed and administered as) a deferred compensation
plan or an employee benefit plan within the meaning of ERISA. Bonus Awards
under this Plan are intended to be discretionary and shall not constitute a part of
an employee’s regular rate of pay for any purpose.

 

C.                                     Term. The provisions of the Plan shall continue indefinitely
subject to termination by the Company; however, the Committee shall, in its
sole and absolute discretion, determine each year whether Bonus Awards will be
granted for such year.

 

D.                                    Definitions. Unless the context requires otherwise, the
following terms when used with initial capitalization have the following
meanings:

 

Award Year — The
calendar year for which Bonus Awards, if any, are calculated under the Plan.

 

Base Salary – The
annual base compensation paid to a Participant for an Award Year and base pay
not paid during the Award Year as a result of an earnings reduction election
under a Code section 125 cafeteria plan or any deferred compensation plan
or other arrangement.

 

Board — The Board of
Directors of the Company.

 

Bonus Award – The
cash bonus payable to a Participant as determined under Section III.A.,
subject to the terms of the Plan.

 

Code — The Internal
Revenue Code of 1986, as from time to time amended including any related
regulations.

 

 

Committee – The
Compensation Committee of the Board.

 

Company – Marten
Transport, Ltd.

 

Designated Subsidiary — A
subsidiary of the Company that has been designated by the Committee from time
to time, in its sole and absolute discretion, as eligible to participate in the
Plan.

 

Director — Each
director level employee of the Company or a Designated Subsidiary.

 

Eligible Employee – Each
non-driver employee of the Company or a Designated Subsidiary who has completed
at least one year of continuous service as of December 31 of an Award Year
and is employed by the Company or a Designated Subsidiary as of December 31
of an Award Year.

 

Employer — The Company
and any Designated Subsidiary.

 

ERISA — The Employee
Retirement Income Security Act of 1974, as from time to time amended, including
any related regulations.

 

Executive Officer –
Each executive officer of the Company who has been elected an executive
officer, within the meaning of the rules of the Securities and Exchange
Commission, by the Board.

 

Non-Driver Employee –
Each non-driver employee of the Company or a Designated Subsidiary whom is not
an Executive Officer or a Director.

 

Participant — Each Eligible
Employee who is designated as a Participant for an Award Year by the Committee.

 

Performance Objective
– A specified level for the Company’s net income, before any Bonus Award, as
established by the Committee for each Award Year.

 

Plan — The Marten
Transport, Ltd. Performance Incentive Bonus Plan, as evidenced by this written
instrument as may be amended from time to time.

 

Subsidiary — Any
entity, corporate or otherwise, in which the Company, directly or indirectly,
owns or controls a greater than 50% interest.

 

Target Award Percentage –
The Target Award Percentage set forth on Exhibit A for the percentage of
the Performance Objective achieved by the Company.

 

II.                                     PARTICIPATION

 

A.                                   Participants. Participants will be determined annually by
the Committee from among the Company’s Eligible Employees. Designation as a
Participant will

 

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apply only for the
Award Year for which the designation is made and may include a partial
year.

 

B.                                     Termination of Employment. In order to be entitled to
receive a payment for Bonus Award for an Award Year, a Participant must be
actively and continuously employed for at least one year through December 31
of the Award Year for which the Bonus Award is paid; however, the Committee may,
in its sole and absolute discretion, pay a Bonus Award to a Participant who has
terminated employment prior to December 31 of the relevant Award Year.

 

III.                                 COMPUTATION
AND PAYMENT OF BONUS AWARDS

 

A.                                   Formula Bonus.

 

1.                                       Executive Officers. Each Executive Officer will be eligible to
receive a Bonus Award equal to 50% of his or her Base Salary, multiplied by the
Target Award Percentage for the percentage of the Performance Objective
achieved by the Company for an Award Year, as set forth on Exhibit A.

 

2.                                       Directors. Each Director will be eligible to receive a Bonus
Award equal to 15% of his or her Base Salary, multiplied by the Target Award
Percentage for the percentage of the Performance Objective achieved by the
Company for an Award Year, as set forth on Exhibit A.

 

3.                                       Non-Driver Employees. Each Non-Driver Employee will be
eligible to receive a Bonus Award equal to 5% of his or her Base Salary,
multiplied by the Target Award Percentage for the percentage of the Performance
Objective achieved by the Company for an Award Year, as set forth on Exhibit A.

 

4.                                       Minimum Performance Objective. No Bonus Award will be earned
under this Section III.A. unless the Company’s net income for an Award
Year is at least 96% of the Performance Objective.

 

5.                                       Pro Ration. If the percentage of the Performance Objective
achieved by the Company for an Award Year is between two whole percentages, the
Bonus Award will be prorated on a straight-line basis between such whole
percentages.

 

B.                                     Committee’s Discretion. The Committee may, in its sole and absolute
discretion, at any time during or after an Award Year adjust the Company’s net
income for the purpose of determining Bonus Awards for an Award Year to account
for extraordinary items affecting net income.

 

C.                                     Cash Payment. Payment of a Bonus Award will be made in cash
as soon as practicable following the end of the Award Year, without interest,
but in any event by the March 15 following the end of the Award Year.

 

3

 

D.                                    Withholding Taxes. Notwithstanding any of the foregoing
provisions, the Employer shall withhold from any payment to be made hereunder
such amounts as it reasonably determines it may be required to withhold
under any applicable federal, state or other law, and transmit such withheld
amounts to the appropriate authorities.

 

E.                                      Payment in Event of Incapacity. If any individual entitled
to receive any payment under the Plan is, in the judgment of the Committee,
physically, mentally or legally incapable of receiving or acknowledging receipt
of the payment, and no legal representative has been appointed for the
individual, the Committee may (but is not required to) cause the payment
to be made to any one or more of the following as may be chosen by the
Committee; the institution maintaining the individual; a custodian for the
individual under the Uniform Transfers to Minors Act of any state; or the
individual’s spouse, child, parent, or other relative by blood or marriage. The
Committee is not required to see to the proper application of any such payment,
and the payment completely discharges all claims under the Plan against the
Company, and the Plan to the extent of the payment.

 

F.                                      Payment in the Event of Death. Distribution to a deceased
Participant will be made to the Participant’s heirs determined pursuant to the
applicable laws of inheritance or descent.

 

IV.                                 PLAN
ADMINISTRATION

 

A.                                   Plan Administration. The Committee or its delegate has the
authority and responsibility to manage and control the general administration
of the Plan. This Plan is not intended to modify or limit the powers, duties or
responsibilities of the Committee as set forth under the Charter for the
Committee as adopted by the Board from time to time. Determinations, decisions
and actions of the Committee, in connection with the construction,
interpretation, administration, or application of the Plan will be final,
conclusive, and binding upon any Participant and any person claiming under or
through the Participant. No employee of an Employer, any member of the Board,
any delegate of the Board, or any member of the Committee will be liable for
any determination, decision, or action made in good faith with respect to the
Plan or any Bonus Award made under the Plan.

 

B.                                     Compensation Committee. The Compensation Committee has the
sole authority and responsibility to establish the amount of any Bonus Award payable
to any Participant.

 

V.                                     AMENDMENT
OR TERMINATION

 

The Plan may at any
time be amended, modified, or terminated, as the Committee in its sole and
absolute discretion determines. Such amendment, modification, or termination of
the Plan will not require the consent, ratification, or approval of any party,
including any Participant.

 

4

 

VI.                                 MISCELLANEOUS

 

A.                                   Non-Assignability. A Participant’s rights and interests in
and to payment of any Bonus Award under the Plan may not be assigned,
transferred, encumbered or pledged other than by will or the laws of descent
and distribution; and are not subject to attachment, garnishment, execution or
other creditor’s processes.

 

B.                                     No Contract of Employment. Neither the Plan, nor any Bonus Award,
constitutes a contract of employment, and participation in the Plan will not
give any employee the right to be retained in the service of the Company or any
Subsidiary or continue in any position or at any level of compensation.

 

C.                                     Controlling Law. This Plan and all determinations made and
actions taken pursuant hereto to the extent not preempted by federal laws, will
be governed and construed by the internal laws of the State of Wisconsin,
except its laws with respect to choice of law.

 

D.                                    Unfunded, Unsecured Obligation. A Participant’s only
interest under the Plan shall be the right to receive either a cash payment for
a Bonus Award pursuant to the terms of the Bonus Award and the Plan. No portion
of the amount payable to a Participant under this Plan shall be held by the
Company or any Subsidiary in trust or escrow or any other form of asset
segregation. To the extent that a Participant acquires a right to receive a
cash payment under the Plan, such right shall be no greater than the right of
any unsecured, general creditor of the Company, and no trust in favor of any
Participant will be implied.

 

5

 

EXHIBIT A

 

	
  Percentage of

  Performance

  Objective

  Achieved

  	
   

  	
  Target

  Award

  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  96

  	
  %

  	
  5

  	
  %

  
	
  97

  	
  %

  	
  10

  	
  %

  
	
  98

  	
  %

  	
  15

  	
  %

  
	
  99

  	
  %

  	
  20

  	
  %

  
	
  100

  	
  %

  	
  25

  	
  %

  
	
  101

  	
  %

  	
  30

  	
  %

  
	
  102

  	
  %

  	
  35

  	
  %

  
	
  103

  	
  %

  	
  40

  	
  %

  
	
  104

  	
  %

  	
  45

  	
  %

  
	
  105

  	
  %

  	
  50

  	
  %

  
	
  106

  	
  %

  	
  60

  	
  %

  
	
  107

  	
  %

  	
  70

  	
  %

  
	
  108

  	
  %

  	
  80

  	
  %

  
	
  109

  	
  %

  	
  90

  	
  %

  
	
  110

  	
  %

  	
  100

  	
  %

  
	
  111

  	
  %

  	
  105

  	
  %

  
	
  112

  	
  %

  	
  110

  	
  %

  
	
  113

  	
  %

  	
  115

  	
  %

  
	
  114

  	
  %

  	
  120

  	
  %

  
	
  115

  	
  %

  	
  125

  	
  %

  
	
  116

  	
  %

  	
  130

  	
  %

  
	
  117

  	
  %

  	
  135

  	
  %

  
	
  118

  	
  %

  	
  140

  	
  %

  
	
  119

  	
  %

  	
  145

  	
  %

  
	
  120

  	
  %

  	
  150

  	
  %

  

 

6Exhibit 10.1

 

TERMINATION AGREEMENT

 

This Termination Agreement is made as of March 31,
2006 (this “Agreement”), by and between Merisant US, Inc., a Delaware
corporation (“Merisant”), and Heinz U.S.A, a division of H.J. Heinz Company (“Heinz”).

 

WHEREAS, Merisant and Heinz are parties to
that certain Amended and Restated Food Service Distribution Agreement, dated as
of May 16, 2001 (as amended to date, the “Food Service Distribution
Agreement”), and that certain Amended and Restated Retail Distribution Agreement,
dated as of May 17, 2001, (as amended to date, the “Retail Distribution
Agreement” and together with the Food Service Distribution Agreement, the “Distribution
Agreements”); and

 

WHEREAS, Heinz delivered written notice to
Merisant on February 13, 2006, notifying Merisant that the Retail
Distribution Agreement would terminate in accordance with Section 9.1 of
that agreement; and

 

WHEREAS, Merisant delivered written notice to
Heinz on February 15, 2006, notifying Heinz that the Food Service
Distribution Agreement would terminate in accordance with Section 9.1 of
that agreement; and

 

WHEREAS, Merisant and Heinz each desire to
accelerate the date on which the Distribution Agreements terminate and to
facilitate the transition from Heinz to Merisant’s new distributor, ACH Food
Companies, Inc. (“ACH”).

 

NOW, THEREFORE, for and in consideration of
the mutual promises set forth herein and other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereby
agree as follows:

 

1.                                       Defined Terms.   Capitalized terms not otherwise defined
herein shall have the meaning set forth in the Distribution Agreements as
applicable.

 

2.                                       Termination.

 

2.1                                 Termination Date.  Each of the Distribution Agreements shall
terminate on May 4, 2006 (the “Termination Date”).

 

2.2                                 Early Termination
Compensation.  Merisant shall pay to
Heinz on or before the Termination Date an amount equal to One Million Five
Hundred Thousand Dollars and Zero Cents ($1,500,000.00) by wire transfer of
immediately available funds to an account designated in writing by Heinz not
later than two business days prior to the Termination Date (the “Termination
Fee”).  The Termination Fee shall be in
addition to any commissions or other amounts that Heinz earns in accordance
with the terms of the Distribution Agreements prior to the Termination
Date.  For avoidance of doubt, such
commissions shall be as set forth in the Distribution Agreement as in effect on
the date hereof and do not include the proposed commissions set forth in the
proposed First

 

 

Amendment to the Food Service Distribution Amendment and the proposed
Second Amendment to the Retail Distribution Agreement.

 

3.                                       Inventory.

 

3.1                                 Maximum Inventory
Level.  Heinz shall maintain minimum
inventory for any stock keeping unit, or a separate, individual inventory item
differentiated by style, color, size or other characteristic of a Product.

 

3.2                                 Purchase of
Inventory.  Merisant shall acquire
from Heinz all good and salable inventory of Products in Heinz’s possession on
or before the Termination Date that have not been purchased by customers of
Heinz prior to such date.  Merisant shall
purchase such inventory of Products at Heinz’s original cost thereof, and Heinz
shall provide Merisant with reasonable evidence of such original cost.  Payment terms shall be net on receipt of
inventory.  Heinz shall permit
representatives of Merisant to inspect inventory of Products at warehouses and
distribution centers during normal business hours and upon reasonable advance
notice and representatives of ACH shall be permitted to accompany
representatives of Merisant.  Heinz shall
make such inventory of Products available at all warehouses and distribution
centers for pick-up by Merisant, ACH or their respective agents on a date not later
than the Termination Date mutually agreed by the parties.  Merisant shall reimburse Heinz for any
reasonable out-of-pocket expenses incurred by Heinz in making the inventory of
Products available for pick-up by Merisant, ACH or their respective agents.

 

4.                                       Trade
Spending; Trade Spending Escrow. 
Merisant shall not be liable for any new promotional allowances
established or initiated by Heinz after May 4, 2006 and Heinz shall not
establish or initiate any new promotional programs or agreements after May 4,
2006.  The parties shall work in good
faith to establish an escrow account for the purpose of disbursing amounts
related to promotional allowances authorized by Merisant and incurred by Heinz
pursuant to Section 4.4 of each of the Distribution Agreements.  On or before May 4, 2006, Merisant shall
deposit with a nationally recognized financial institution designated by
Merisant (the “Escrow Agent”) Two Million, Five Hundred Thousand Dollars and
Zero Cents ($2,500,000.00)  (the “Escrow
Amount”) to be held in escrow pursuant to the terms and conditions of an escrow
agreement reasonably satisfactory in form and substance to Merisant and Heinz
(the “Escrow Agreement”).  The Escrow
Agreement shall provide that the Escrow Amount shall be deposited into an interest
bearing account at the Escrow Agent and that the Escrow Agent shall release
amounts to Heinz in immediately available funds by wire transfer to an account
or accounts designated by Heinz up to but not exceeding the initial Escrow
Amount upon delivery to the Escrow Agent of a joint written instruction from
Merisant and Heinz.  The Escrow Agreement
shall further provide that Merisant shall deliver such joint written
instruction if Heinz delivers an invoice to Merisant for promotional allowances
incurred pursuant to Section 4.4 of the Retail Distribution Agreement or
Food Service Distribution Agreement, as the case may be, provided that such
invoice is delivered to Merisant in the month immediately following such
promotional activity with such documentary evidence as Merisant may reasonably
request.  Merisant owns and shall be
responsible for all trade

 

2

 

liability associated with activity post May 4, 2006, including
under any pre-existing operator, distributor and customer agreements.  Except as provided below, all remaining
amounts held in escrow pursuant to Escrow Agreement on or after the date that
is ninety (90) days after the date of the Escrow Agreement and not subject to a
Heinz request for reimbursement, including, without limitation, all accrued
interest thereon, shall be returned to Merisant; provided that Five Hundred
Thousand Dollars and Zero Cents ($500,000.00) shall remain subject to the
Escrow Agreement until the date that is one hundred thirty-five (135) days
after the date of the Escrow Agreement on which date all remaining amounts held
in escrow pursuant to Escrow Agreement and not subject to a Heinz request for
reimbursement, including, without limitation, all accrued interest thereon, shall
be returned to Merisant.  Merisant and
Heinz shall bear equally all fees and expenses of the Escrow Agent under the
Escrow Agreement.  This Escrow Amount is
not intended as a cap or limit on Merisant’s responsibility for promotional
allowances and any documented promotional allowance costs in excess of the
Escrow Amount shall be paid to Heinz by Merisant directly.

 

5.                                       Payment of
Past Due Amounts.  Heinz shall pay to
Merisant $394,202.42 which represents the final and complete settlement of all
deductions and outstanding items between the parties as of February 23,
2006 (Schedule A summarizes all outstanding monies owed between the two
parties).

 

6.                                       Miscellaneous.

 

6.1                                 Governing Law.  This Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of
Illinois, excluding the conflict of laws provisions thereof.

 

6.2                                 Binding Effect;
Third Party Beneficiaries.  All of
the terms, agreements, covenants, representations, warranties and conditions of
this Agreement are binding upon, and inure to the benefit of and are
enforceable by, the parties and their respective successors and permitted
assigns.  There are no third party
beneficiaries having rights under or with respect to this Agreement.

 

6.3                                 Entire Agreement.  This Agreement sets forth the entire and
final agreement and understanding of the parties with respect to the subject
matter of this Agreement.  Any and all
prior agreements or understandings, whether written or oral, with respect to
the subject matter of this Agreement, are hereby terminated.  This Agreement may not be modified or amended
except by an instrument in writing executed by the parties to this Agreement.
Any terms or conditions that may be different from, or in addition to those
agreed to and set forth in this Agreement, are expressly objected to and will
not be binding upon either party unless mutually agreed to in writing.

 

6.4                                 Extensions; Waivers.  Any party may, for itself only, (i) extend
the time for the performance of any of the obligations of any other party under
this Agreement and (ii) waive compliance with any of the agreements or
conditions for the benefit of such party contained herein.  Any such extension or waiver will be valid
only if set forth in a

 

3

 

writing signed by the party to be bound thereby.  No waiver by any party of any default,
misrepresentation or breach of warranty or covenant hereunder, whether
intentional or not, may be deemed to extend to any prior or subsequent default,
misrepresentation or breach of warranty or covenant hereunder or affect in any
way any rights arising because of any prior or subsequent such occurrence.  Neither the failure nor any delay on the part
of any party to exercise any right or remedy under this Agreement will operate
as a waiver thereof, nor will any single or partial exercise of any right or
remedy preclude any other or further exercise of the same or of any other right
or remedy.

 

6.5                                 Severability.  The provisions of this Agreement will be
deemed severable and the invalidity or unenforceability of any provision will
not affect the validity or enforceability of the other provisions hereof;
provided that if any provision of this Agreement, as applied to any party or to
any circumstance, is judicially determined not to be enforceable in accordance
with its terms, the parties agree that the court judicially making such
determination may modify the provision in a manner consistent with its
objectives such that it is enforceable, and/or to delete specific words or
phrases, and in its modified form, such provision will then be enforceable and
will be enforced.

 

6.6                                 Construction.  The parties have participated jointly in the
negotiation and drafting of this Agreement. 
If any ambiguity or question of intent or intent arises, this Agreement
will be construed as if drafted jointly by the parties and no presumption or
burden of proof will arise favoring or disfavoring any party because of the
authorship of any provision of this Agreement.

 

6.7                                 Headings.  The article and section headings
contained in this Agreement are inserted for convenience only and will not
affect in any way the meaning or interpretation of this Agreement.

 

6.8                                 Counterparts.  This Agreement may be executed in two or more
counterparts, each of which will be deemed an original but all of which
together will constitute one and the same instrument.

 

 

[Signature Page Follows]

 

4

 

IN WITNESS WHEREOF, Merisant and Heinz, by
their respective duly authorized officers or representatives, have executed and
delivered this Agreement on the date first above written.

 

	
   

  	
  MERISANT US, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jonathan W. Cole

  	
   

  
	
   

  	
   

  	
  Jonathan W. Cole

  
	
   

  	
   

  	
  Vice President, General Counsel

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HEINZ U.S.A

  
	
   

  	
  a division of H.J. Heinz Company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gregg Newcomb

  	
   

  
	
   

  	
   

  	
  Gregg Newcomb

  
	
   

  	
   

  	
  Group Vice President of Sales U.S.

  
	
   

  	
   

  	
  Consumer Products

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Anthony J. Muscato

  	
   

  
	
   

  	
   

  	
  Anthony J. Muscato

  
	
   

  	
   

  	
  Group Vice President of Sales

  
	
   

  	
   

  	
  Foodservice

  

 

Signature Page to Termination
Agreement

 

5

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