Document:

EXHIBIT 10.6

CASCADE CORPORATION

STOCK APPRECIATION
RIGHTS PLAN

1.   Purposes.

This Plan is intended to
enable Cascade Corporation (the “Corporation”) to recognize the contribution of
executives of the Corporation and its subsidiaries to the Corporation’s success,
to provide them incentives to enhance the Corporation’s business prospects and
to recognize their role and that of the Board of Directors (the “Board”) in
increasing value over the long term.

2.   Effective
Date and Duration of Plan.

(a)   Effective Date.   The Plan shall become effective
upon approval by the shareholders of the Corporation

(b)   Duration.   No stock appreciation rights may be granted
under the Plan after May 31, 2013. However, the Plan shall continue in
effect until all rights issued under the Plan have been exercised or have
expired. The Board may suspend or terminate the Plan at any time, except with
respect to outstanding stock appreciation rights. Termination shall not affect
any outstanding stock appreciation rights, or the forfeitability of rights
granted under the Plan.

3.   Administration.

The Plan shall be administered by the Compensation
Committee of the Board. The Committee shall have full power and authority,
subject to the provisions of the Plan, to:

(a)  Designate
employee participants;

(b) Determine the
amount and other terms and conditions of awards of stock appreciation rights to
employees, such determinations to be subject to Board approval in the case of
grants to officers of the Corporation, and those terms and conditions of stock
appreciation rights awarded to non-employee members of the Board of Directors
which are not stated in Section 10 of the Plan.

(c)  Adopt and
amend rules and regulations relating to administration of the Plan,
advance the lapse of any waiting period, accelerate any exercise date, and make
all other determinations in the judgment of the Committee necessary or
desirable for the administration of the Plan.

Decisions of the Committee
as to interpretation of, and rights granted pursuant to, the Plan and any
related agreement shall be final. The Committee in its sole discretion may
correct any defect or supply any omission or reconcile any inconsistency in the
Plan or in any related agreement.

4.   Eligibility.

The Committee may from
time to time grant stock appreciation rights (“Rights”) to such key executive
employees of the Corporation (“Participants”) or of any subsidiary as the
Committee may deem eligible.

5.   Rights/Share
Limitation.

(a)  A Right is a
right granted under the Plan which enables the holder to receive at the time of
exercise an amount, payable solely in the form of Cascade Corporation common
shares valued at Fair Market Value, equal to the difference between the Fair
Market Value of a single common share of Cascade Corporation stock and the Base
Price of a single common share of Cascade Corporation stock.

 1
 

(b) In no event
shall more than 750,000 Cascade Corporation common shares, as adjusted by the
Committee to reflect proportionately any recapitalization, reclassification,
stock split, combination of shares, or dividend payable in shares in connection
with Cascade Corporation common shares be issued pursuant to the Plan.

(c)  In no event shall more than 100,000 Cascade Corporation shares, as
adjusted by the Committee to reflect proportionately any recapitalization,
reclassification, stock split, combination of shares, or dividend payable in
shares in connection with Cascade Corporation common shares, be issued to any
one individual pursuant to the exercise of Rights granted to such individual
under the Plan in a single fiscal year.

6.   Required
Terms and Conditions of Rights.

The Committee may
grant Rights under the Plan, subject to such rules, terms, and conditions as
the Committee prescribes in accordance with the provisions of the Plan,
including the following:

(a)   Base Price.   The Base Price of each
Right shall be established by the Committee and may not be less than the Fair
Market Value of a common share of Cascade Corporation common stock on the date
the grant is made.

(b)   Fair Market Value.   The Fair Market
Value of a common share of Cascade Corporation common stock means the closing
price quoted on the New York Stock Exchange or, if shares are not listed on
that exchange, the primary trading venue for Corporation shares, as reported in
the Wall Street Journal on the date of grant or exercise, as the case may be,
or if the shares did not trade that date, on the last prior date on which the
shares were traded.

(c)   Maximum Term of Right.   A Right shall
be exercisable during such period of time as the Committee may specify,
provided that no Right shall be exercisable after the expiration of
10 years from the date on which it is granted.

(d)   Installment Exercise Limitations.   Each
grant of Rights shall generally become exercisable in equal cumulative annual
installments over such period as the Committee may establish, except to the
extent that other terms of exercise are specifically provided by other terms of
the Plan. The Committee shall have discretion to establish vesting periods and
limitations on amounts to be realized upon exercise in connection with grants
it may make.

(e)   Termination of Employment.

(i)    Death. If
a Participant dies while entitled to exercise Rights granted under this Plan,
such Rights may be exercised for a period of one year after the Participant’s
death. Rights not exercisable at the time of death, and Rights not exercised
during the period provided by this subparagraph, will expire. In the event of a
Participant’s death, Rights exercisable as of the date of the Participant’s
death may be exercised by such beneficiary as the Participant may have
designated in writing in a manner determined by the Committee. In the absence
of such a designation, the Participant’s estate shall have the right to
exercise such Rights.

(ii)   Retirement.
If a Participant terminates employment after age 62 under circumstances which
the Committee in its sole discretion deems equivalent to retirement, any Rights
the Participant was entitled to exercise at the date of retirement may be
exercised for a period of one year following retirement. Rights not exercisable
at the time of retirement, and Rights not exercised during the period provided
by this subparagraph, will expire. The provisions of this subparagraph (ii) shall
apply also to retirements due to physical or mental disability which the
Committee determines is of such a nature as to prevent further performance of
job duties. Should a retired Participant die while entitled to exercise Rights,
the provisions of subparagraph (i) above shall apply to the exercise of
such Rights, which may be exercised for a period of one year following the
Participant’s death.

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(iii) Other
Termination of Employment—Not For Cause. Should a Participant cease to be employed
by the Corporation or its subsidiaries for reasons other than Death or
Retirement, any Rights the Participant was entitled to exercise at the date of
termination may be exercised for a period of 90 days following termination
or, if longer, until 30 days have elapsed following the public
dissemination of the Corporation’s financial results for the first fiscal
period ending after the termination of the Participant’s employment. Rights not
exercisable at the time of termination, and Rights not exercised during such 90-day
or extended period, shall expire. Should a terminated Participant die while
entitled to exercise Rights, the provisions of subparagraph (i) above
shall apply to the exercise of such Rights, which may be exercised for a period
of one year following the Participant’s death. The rights granted by this
subparagraph (iii) shall not apply to a Participant who is terminated for
Cause, or whom the Committee determines in its sole discretion has entered into
competition with the Corporation.

(iv)  Termination
for Cause. Participants whose employment is terminated for (A) willful
failure to perform reasonable directives of the Corporation’s management; (B) use
of alcohol or illegal drugs which interferes with the Participant’s performance
of duties in the judgment of the Corporation’s management; (C) dishonesty
affecting the Corporation or any related entity or conviction of a felony or
any crime involving fraud or misrepresentation; (D) gross negligence or
willful misconduct resulting in substantial loss to the Corporation, damage to
the Corporation’s reputation, or theft, embezzlement or similar loss to the
Corporation; or (E) other conduct which the Committee in its sole
discretion determines sufficiently harmful to the interests of the Corporation
to constitute cause for termination shall forfeit all outstanding Rights
awarded under this Plan.

(f) 
Acceleration of Vesting.   The Committee shall have discretion
to provide in an individual Participant’s grant agreement for the exercise of
all or a portion of Rights granted to the Participant which would not otherwise
be exercisable, in the event of the Participant’s Death or Retirement.

(g)  Exercise.

(i)  Subject to subparagraph (v) of this
paragraph (g), the Committee shall establish the time or times for
exercise of Rights.

(ii)  Each Right shall entitle the holder, upon
exercise, to receive from the Corporation an amount equal in value to the
excess of the Fair Market Value on the date of exercise of one Right over its
Base Price. Such amount shall be payable solely in the form of Cascade
Corporation common shares valued at Fair Market Value. No Right shall be
exercisable at a time that the amount determined under this Subsection is
negative. No fractional shares shall be issued as payment hereunder.

(iv)  The Corporation shall make no payment
hereunder prior to taking steps necessary to assure that it will receive from a
participant who has exercised a Right amounts necessary to satisfy any
applicable federal, state or local tax withholding requirements, including
social security and other normal withholdings.

(v)  Rights may be exercised only during the 30-day
period following the third business day after public dissemination of the
Corporation’s financial results for any fiscal quarter or for its fiscal year.

(h)  Non-Transferability.   During a
Participant’s lifetime, Rights shall be exercisable only by the Participant,
the Participant’s payee pursuant to a valid order by a domestic relations court
with jurisdiction, or by a legally designated guardian or conservator. With the
Committee’s prior consent, a Participant may transfer Rights to a trust for his
or her benefit established for estate planning purposes.

7.   Changes in
Capital Structure, Mergers, Etc.

(a)  Change in
Capital Structure.   If the outstanding shares of Common Stock
of the Corporation are hereafter increased, decreased or changed into or
exchanged for a different number or kind of shares of 

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the Corporation or of
another corporation by reason of any recapitalization, reclassification, stock
split, combination of shares or dividend payable in shares, the Committee shall
make appropriate adjustments in the price and number of outstanding Rights or
portions thereof then unexercised, so that the participant’s proportionate
interest before and after the occurrence of the event is maintained; provided,
however, that this Section 7(a) shall not apply with respect to
transactions referred to in Section 7(b). Any such adjustment made by the
Committee shall be conclusive.

(b)  Reorganization or
Liquidation.

(i)  Cash, Stock or Other Property for Stock.  Except as provided in Section 7(b)(ii),
upon a merger, consolidation, reorganization, plan of exchange or liquidation
involving the Corporation, as a result of which the shareholders of the
Corporation receive cash, stock or other property in exchange for or in
connection with their Common Stock (any such transaction to be referred to in
this Section 7 as an “Accelerating Event”), any Right granted hereunder
shall terminate, except as specified in the first sentence of Section 7(b)(ii),
but the employee shall have the right during the 30-day period
immediately prior to any such Accelerating Event to elect to exercise Rights
awarded him or her, in whole or in part, without any limitation on
exercisability; provided, however, that such exercise shall be deemed to occur
immediately prior to such Accelerating Event and shall be contingent upon the
occurrence of such Accelerating Event.

(ii)  Stock for Stock. If the shareholders of the
Corporation receive capital stock of another Corporation (“Exchange Stock”) in
exchange for their Common Stock in any transaction involving a merger,
consolidation, reorganization, or plan of exchange, all Rights granted
hereunder shall be converted into stock appreciation rights and awards measured
by the Exchange Stock, unless the Committee, in its sole discretion, determines
that any or all such Rights shall not be converted, but instead shall terminate
in accordance with the provisions of Section 7(b)(i) The amount and
price of converted Rights shall be determined by adjusting the amount and price
of the Rights or other awards granted hereunder to take into account the
relative values of the Exchange Stock and Corporation’s common shares in the
transaction.

(iii)  Mergers,
Acquisitions, Etc. The Committee may also grant Rights, with terms, conditions
and provisions that vary from those specified in the Plan if such awards are
granted in substitution for, or in connection with the assumption of, stock
appreciation rights awarded by another Corporation and assumed or otherwise
agreed to be provided for by the Corporation 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
Corporation or a parent or subsidiary Corporation of the Corporation is a
party.

8.   Amendment
of Plan.

The Board may modify or
amend the Plan in such respects as it deems advisable because of changes in the
law while the Plan is in effect or for any other reason; provided, however,
that the maximum number of shares which may be issued under the Plan may be
increased, and the provisions of Paragraph 10 may be modified, only upon
approval by the shareholders of the Corporation. No change in an award already
granted shall be made without the written consent of the holder of such award.

9.   Employment
and Service Rights.

Nothing in the Plan or any
award pursuant to the Plan shall (a) confer upon any employee any right to
be continued in the employment of the Corporation or any parent or subsidiary
Corporation of the Corporation or interfere in any way with the right of the
Corporation or any subsidiary of the Corporation by whom such employee is
employed to terminate such employee’s employment at any time, for any reason,
with or without cause, or increase or decrease such employee’s compensation or
benefits; or 

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(b) confer
upon any person engaged by the Corporation or any parent or subsidiary
Corporation of the Corporation any right to be retained or employed by the
Corporation or any parent or subsidiary Corporation of the Corporation or to the
continuation, extension, renewal, or modification of any compensation,
contract, or arrangement with or by the Corporation or any subsidiary of the
Corporation.

10.   Participation
by Directors

Each non-employee director
of the Corporation shall be awarded 5,000 Rights upon the later of the approval
of this Plan by the shareholders or the election of the director to the Board
of Directors by the shareholders and 2,700 additional Rights following each
subsequent annual meeting of the shareholders. Awards of Rights to directors
shall vest and become exercisable 25% after one year and 25% following each
year of director service thereafter. Such awards shall be subject to the
provisions of this Plan in all other respects. All Rights granted to a director
shall be exercisable upon the director’s death or reaching of the mandatory
retirement age established for directors, whether or not they would otherwise
be subject to exercise.

11.   Rights as
a Shareholder.

The recipient of any award
under the Plan shall have no rights as a shareholder with respect to any Right,
and except as otherwise expressly provided in the Plan, no adjustment shall be
made for dividends or other rights issued to shareholders. Shares issued
pursuant to the Plan may bear such restrictions on sale or other transfer as
counsel to the Corporation may determine are required under securities or other
applicable laws.

12.    Governing
Law.

The provisions of this Plan shall be governed by and
interpreted in accordance with the laws of the State of Oregon.

 5Exhibit 10.8

Summary of Non-Employee Director and Executive Officer
Compensation Arrangements

Director Compensation

The following table sets
forth current rates of cash compensation for non-employee directors:

	
  Annual Retainer:

  	
   

  	
   

  	
   

  
	
  Chairman

  	
   

  	
  $

  	
  75,000

  	
   

  
	
  Non-employee
  directors other than Chairman

  	
   

  	
  $

  	
  24,000

  	
   

  
	
  Committee Chair Annual Retainer:

  	
   

  	
   

  	
   

  
	
  Audit Committee

  	
   

  	
  $

  	
  10,000

  	
   

  
	
  Compensation
  Committee

  	
   

  	
  $

  	
  3,000

  	
   

  
	
  Nominating and
  Governance Committee

  	
   

  	
  $

  	
  3,000

  	
   

  
	
  Board Meeting
  Attendance Fees

  	
   

  	
  $

  	
  1,000

  	
   

  
	
  Committee Meeting
  Attendance Fees

  	
   

  	
  $

  	
  1,000

  	
   

  

 

In addition to cash compensation, under the terms of
our Stock Appreciation Rights Plan non-employee directors receive an annual award
of 2,700 stock appreciation rights. Non-employee directors received an award of
5,000 stock appreciation rights when the Stock Appreciation Rights Plan was
approved at the 2004 Annual Meeting of Shareholders and each new director will
receive an award of 5,000 stock appreciation rights upon initial election by
the shareholders. The price and terms of stock appreciation rights are
established by our Board of Directors’ Compensation Committee. Stock
appreciation rights are historically granted at the reported market value of a
Cascade share at the grant date, become exercisable on an annual basis ratably
over four years, and have a 10-year term.

Non-employee directors are
also reimbursed for travel and other expenses attendant to membership on the
Cascade board.

 1
 

Executive Compensation

Base
Salary.   All of
Cascade’s executive officers, with the exception of Herre Y. Hoekstra, are
at-will employees whose compensation and employment status may be changed at
any time by the Board of Directors.  Base
salary increases are determined annually by the Board of Directors and become
effective on February 1 of each year. The following table sets forth the
current base salaries of Cascade’s executive officers and their titles as of
the date of filing of Cascade’s Form 10-K for the fiscal year ended January 31,
2006:

	
  Executive Officer

  	
   

  	
   

  	
   

  	
  Fiscal 2007

  Base Salary

  	
   

  
	
  Robert C.
  Warren, Jr., President and Chief Executive Officer

  	
   

  	
   

  	
  $

  	
  460,000

  	
   

  	
   

  
	
  Terry H. Cathey, Senior Vice President and Chief Operating Officer

  	
   

  	
   

  	
  275,000

  	
   

  	
   

  
	
  Richard S. Anderson, Senior Vice President and Chief Financial Officer

  	
   

  	
   

  	
  275,000

  	
   

  	
   

  
	
  Gregory S. Anderson, Senior Vice President-Human Resources

  	
   

  	
   

  	
  190,000

  	
   

  	
   

  
	
  Herre Y. Hoekstra, Vice President and Managing Director, Europe

  	
   

  	
   

  	
  182,000

  	
   

  	
   

  
	
  Michael E. Kern, Vice President-Sales and Marketing

  	
   

  	
   

  	
  155,000

  	
   

  	
   

  
	
  Kevin B. Kreiter, Vice President-Engineering(1)

  	
   

  	
   

  	
  125,000

  	
   

  	
   

  
	
  Jeffrey K. Nickoloff, Vice President-Corporate Manufacturing

  	
   

  	
   

  	
  170,000

  	
   

  	
   

  
	
  Joseph G. Pointer, Vice President-Finance

  	
   

  	
   

  	
  190,000

  	
   

  	
   

  
	
  Robert C. Schuster, Vice President-Asia Pacific

  	
   

  	
   

  	
  132,000

  	
   

  	
   

  
	
  Anthony F. Spinelli, Vice President-OEM Products

  	
   

  	
   

  	
  185,000

  	
   

  	
   

  

(1)          Appointment effective February 1,
2006.

Annual Incentive.   Executive
officers are also eligible to receive an incentive payment following the end of
each fiscal year under an executive incentive plan approved by Cascade’s Board
of Directors. Fiscal 2006 incentives approved for the executive officers are
shown in the following table:

	
  Executive Officer

  	
   

  	
   

  	
   

  	
  Fiscal 2006

  Incentive

  	
   

  
	
  Robert C.
  Warren, Jr., President and Chief Executive Officer

  	
   

  	
   

  	
  $

  	
  644,000

  	
   

  	
   

  
	
  Terry H. Cathey, Senior Vice President and Chief Operating Officer

  	
   

  	
   

  	
  324,000

  	
   

  	
   

  
	
  Richard S. Anderson, Senior Vice President and Chief Financial Officer

  	
   

  	
   

  	
  324,000

  	
   

  	
   

  
	
  Gregory S. Anderson, Senior Vice President-Human Resources

  	
   

  	
   

  	
  198,000

  	
   

  	
   

  
	
  Herre Y. Hoekstra, Vice President and Managing Director, Europe

  	
   

  	
   

  	
  53,000

  	
   

  	
   

  
	
  Michael E. Kern, Vice President-Sales and Marketing

  	
   

  	
   

  	
  116,000

  	
   

  	
   

  
	
  Jeffrey K. Nickoloff, Vice President-Corporate Manufacturing

  	
   

  	
   

  	
  160,000

  	
   

  	
   

  
	
  Joseph G. Pointer, Vice President-Finance

  	
   

  	
   

  	
  198,000

  	
   

  	
   

  
	
  Robert C. Schuster, Vice President-Asia
  Pacific

  	
   

  	
   

  	
  55,000

  	
   

  	
   

  
	
  Anthony F. Spinelli, Vice President-OEM Products

  	
   

  	
   

  	
  150,000

  	
   

  	
   

  

 

Annual executive incentive payments are structured to
encourage the building of shareholder value by maximizing Cascade’s pre-tax
income. For fiscal 2006, all participating executives, with the exception of Messrs. Hoekstra,
Schuster and Spinelli, were eligible to receive a specified percentage
(depending on position) of the Company’s pre-tax income before non-recurring
items, incentive payments and certain other expenses (“IBT”) if IBT exceeded $28
million. The percentage of IBT each executive was entitled to receive increased
if IBT exceeded $36 million, and increased again if IBT exceeded $45 million. Annual
incentive payments were limited to a maximum of up to 150% of each executive’s
base salary  depending on their position.
IBT for fiscal 2006 was $66.5 million, resulting in incentive payments to all eligible
executive officers equal to 100% of the maximum amount participants could have
received. The Board of Directors has the discretion to reduce annual incentives
otherwise payable by up to 30% if it believes 

 2
 

reduction is justified by
business conditions or individual performance, or to increase incentives by up
to 20% for extraordinary individual performance. Messrs. Spinelli and Schuster
received annual incentive payments for fiscal 2006 based upon a percentage of
pre-tax income for the business unit for which they were responsible. Mr. Hoekstra’s
incentive was a fixed payment agreed at the time of his hire in September 2005.

Long-term
Incentive.   The third component of executive
compensation for Cascade’s executive officers is long-term incentive awards. Long-term
incentive awards granted in fiscal 2006 consisted of awards of stock
appreciation rights under our Stock Appreciation Rights Plan. The stock
appreciation rights were granted with an exercise price equal to the fair
market value of Cascade’s common stock on the date of the award, have a term of
10 years and become exercisable ratably over four years.

The
number of stock appreciation rights awarded to executive officers in fiscal
2006 are shown in the following table:

	
  Executive Officer

  	
   

  	
   

  	
   

  	
  Stock

  Appreciation

  Rights

  Awarded in 

  Fiscal 2006

  	
   

  
	
  Robert C.
  Warren, Jr., President and Chief Executive Officer

  	
   

  	
   

  	
  75,000

  	
   

  	
   

  
	
  Terry H. Cathey, Senior Vice President and Chief Operating Officer

  	
   

  	
   

  	
  50,000

  	
   

  	
   

  
	
  Richard S. Anderson, Senior Vice President and Chief Financial Officer

  	
   

  	
   

  	
  50,000

  	
   

  	
   

  
	
  Gregory S. Anderson, Senior Vice President-Human Resources

  	
   

  	
   

  	
  50,000

  	
   

  	
   

  
	
  Herre Y. Hoekstra, Vice President and Managing Director, Europe(1)

  	
   

  	
   

  	
  —

  	
   

  	
   

  
	
  Michael E. Kern, Vice President-Marketing

  	
   

  	
   

  	
  35,000

  	
   

  	
   

  
	
  Jeffrey K. Nickoloff, Vice President-Corporate Manufacturing

  	
   

  	
   

  	
  35,000

  	
   

  	
   

  
	
  Joseph G. Pointer, Vice President-Finance

  	
   

  	
   

  	
  35,000

  	
   

  	
   

  
	
  Robert C. Schuster, Vice President-Asia Pacific

  	
   

  	
   

  	
  7,000

  	
   

  	
   

  
	
  Anthony F. Spinelli, Vice President-OEM Products

  	
   

  	
   

  	
  35,000

  	
   

  	
   

  

(1)          Joined Cascade in September 2005.

The number of stock appreciation rights granted to
each executive in fiscal 2006 was determined using grant ranges established by
the Compensation Committee with minimum, target, and maximum grants based on
Cascade’s fiscal year ended January 31, 2005 return on average assets
(defined as net income before extraordinary items divided by the average total consolidated
assets at the beginning and end of each fiscal quarter). The Compensation
Committee set a target rate of return on average assets of 7.25% with 100% of
the target return on average assets equaling the target grant of stock
appreciation rights, 90% of the target return on average assets equaling the
minimum grant of stock appreciation rights, and 110% of the target return on
average assets equaling the maximum grant of stock appreciation rights. Because
Cascade’s fiscal 2005 return on average assets was 152% of the target rate, the
grants of stock appreciation rights for fiscal 2006 are the maximum permitted
under the guidelines set by the Compensation Committee. In June 2006, the
Compensation Committee will recommend long-term incentive awards based on the
fiscal 2006 return on average assets.

Benefit
Plans and Other Arrangements.   Executive officers
are also eligible to participate in Cascade’s broad-based benefit programs
generally available to all salaried employees, including health, disability, life
insurance and defined contribution retirement plan. The executives also receive
certain perquisites offered by Cascade including the use of company automobiles
and tax reimbursements related thereto.

Messrs. Warren, Cathey, and R.S. Anderson are
each a party to a Severance Agreement with Cascade, which are Exhibits 10.3,
10.2, and 10.1, respectively, to Cascade’s Form 10-K for fiscal 2006.

 3

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