Document:

exv10w10

 

Exhibit 10.10

MANAGEMENT PERFORMANCE PLAN

2007 PAYABLE IN 2008

	I.	 	SPONSOR
	 
	 	 	FBL Financial Group, Inc. is the sponsor of the Management Performance Plan.
	 
	II.	 	PARTICIPANTS
	 
	 	 	Participants in the plan include the senior executive group and executive group of FBL’s
Tier I participants. Tier II participants include FBL’s department heads (salary grade 45).
Tier III participants include FBL’s managers (salary grade 44).
	 
	III.	 	FEATURES

	 	A.	 	Each year the FBL Management Development and Compensation Committee approves
five to eight corporate goals. These performance goals would include significant areas
of achievement such as property/casualty accounts, property/casualty and life insurance
new business production, expense management and earnings.
	 
	 	B.	 	Each goal will be given equal weight but may be split between life and
property/casualty performance.
	 
	 	C.	 	Each goal will be measured separately in the determination of the attainment
level. Generally goals for insurance management will be based on the performance over
the entire marketing area. Participants whose responsibilities are limited to a single
state or sales region will be measured according to the performance of that particular
territory.
	 
	 	D.	 	Percentage of incentives to be paid will be calculated separately for each
performance goal and no incentive will be paid on a goal until at least 75% of goal
level is attained.
	 
	 	E.	 	The applicable performance incentive percentage for each goal will increase
proportionately for achievement above 75% of goal level to a maximum of 150% of goal.
	 
	 	F.	 	For Tier I, Groups 1, 2, 3 and 4, achievement of 75% of goal will result in 50%
of the performance incentive percentage, and achievement of 150% of goal will result in
200% of the performance incentive percentage. For Tier I, Group 5, and Tiers II and
III, achievement of 75% of goal will result in 75% of the performance incentive
percentage, and achievement of 150% of goal will result in 150% of the performance
incentive percentage.

 

 

Exhibit 10.10

	 	G.	 	The performance incentive percentage will be applied to the participant’s base
salary paid during the plan year.
	 
	 	H.	 	The performance incentive percentage payable varies by tier and in some cases
by employee group within a tier as follows:
	 
	 	 	 	Tier I

Group 1 Target – 80% of base pay

Chief Executive Officer

Former Chief Executive Officer, until retirement date
	 
	 	 	 	Tier I

Group 2 Target – 50% of base pay

E.V.P. Farm Bureau Life

E.V.P. P/C Companies

E.V.P. EquiTrust Life

Chief Financial Officer
	 
	 	 	 	Tier I

Group 3 Target – 40% of base pay

Vice President – Investments
	 
	 	 	 	Tier I

Group 4 Target– 35% of base pay

Balance of FBL management team
	 
	 	 	 	Tier I

Group 5 Target – 20% of base pay

Executive Group – Grade 50 employees
	 
	 	 	 	Tier II Target – All participants – 10% of base pay

Grade 45
	 
	 	 	 	Tier III Target – All participants – 8% of base pay

Grade 44
	 
	 	I.	 	Payments of the performance incentive will be made annually to each participant
in a single, separate, lump sum payment on or before February 14 for the prior plan
year.
	 
	 	J.	 	The Committee will review the plan annually and make appropriate adjustments
and changes.
	 
	 	K.	 	Based on changing circumstances and resulting inequities during the year,
management will make recommendations to the Committee for appropriate revisions or
adjustments to the goals; revisions or adjustments are expected to be rare.exv10w24

 

Exhibit 10.24

EXHIBIT 10.24 SUMMARY OF NAMED EXECUTIVE OFFICER COMPENSATION

Summary of FBL Financial Group, Inc.

Named Executive Officer Compensation — 2007

     The table below summarizes certain calendar year 2007 compensation information regarding
FBL Financial Group, Inc.’s Chief Executive Officer, Chief Financial Officer and the other three
highest compensated Executive Officers, (collectively the “Named Executive Officers”). These
salaries are subject to change at the discretion of the Management Development and Compensation
Committee and/or Board of Directors of the Company. These salaries do not include the Company’s
contributions to defined benefit and contribution plans and the Company’s contributions to other
employee benefit programs on behalf of the Named Executive Officers.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Name and Title	 	2007 Base	 	 	2007 Non-equity	 	 	2007 Stock	 	 	2007 Restricted	 
	 	 	Salary	 	 	Incentive Plan	 	 	Option Grant	 	 	Stock Grant	 
	 	 	 	 	 	 	threshold, target, cap as	 	 	(#shares) (2)	 	 	(#shares) (3)	 
	 	 	 	 	 	 	% of salary, payable in	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	2008 (1)	 	 	 	 	 	 	 
	James W. Noyce, CEO
	 	$	600,000	 	 	 	40-80-160%	 	 	 	42,104	 	 	 	22,299	 
	James P. Brannen, CFO
	 	$	340,023	 	 	 	25-50-100%	 	 	 	15,917	 	 	 	8,425	 
	Bruce A. Trost,
Executive VP
Property/Casualty
Companies
	 	$	372,855	 	 	 	25-50-100%	 	 	 	17,454	 	 	 	9,238	 
	JoAnn Rumelhart,
Executive VP Farm
Bureau Life
	 	$	370,175	 	 	 	25-50-100%	 	 	 	17,329	 	 	 	9,172	 
	Stephen M. Morain,
Senior VP, Secretary
and General Counsel
	 	$	434,591	 	 	 	17.5-35-70%	 	 	 	11,189	 	 	 	5,922	 

(1) Payable pursuant to the FBL Financial Group, Inc. 2007 Management Performance Plan. Goals for
the plan are set annually in such areas as membership accounts, insurance and annuity premium
volume, expense controls and earnings per share. Payments are made in early February of the year
following performance, upon certification by the Management Development and Compensation Committee
of the level of goal attainment.

(2) Annually granted in mid-January pursuant to the 2006 Class A Common Stock Compensation Plan at
date of grant closing stock price as the exercise price; vest in five annual installments and
expire in ten years. The grants are incentive stock options to the extent permitted by tax law,
with the remaining shares being nonqualified stock options.

(3) Annually issued in February pursuant to the 2006 Class A Common Stock Compensation Plan; these
restricted shares are subject to forfeiture if Company performance goals (measured by earnings per
share and return on equity) and other conditions are not met during the three years ended December
31, 2009, and assume that expected operations will result in earning the target amount of
approximately 50% of the amount granted.exv4w8

 

Exhibit 4.8

As amended February 5, 2007

SOFTBRANDS, INC.

2001 STOCK INCENTIVE PLAN

Section 1. Purpose

     The purpose of the Plan is to promote the interests of the Company and its shareholders by
aiding the Company in attracting and retaining employees, officers, consultants, independent
contractors and Non-Employee Directors capable of assuring the future success of the Company, to
offer such persons incentives to put forth maximum efforts for the success of the Company’s
business and to afford such persons an opportunity to acquire a proprietary interest in the
Company.

Section 2. Definitions

     As used in the Plan, the following terms shall have the meanings set forth below:

          (a) “Affiliate” shall mean (i) any entity that, directly or indirectly through one or more
intermediaries, is controlled by the Company and (ii) any entity in which the Company has a
significant equity interest, in each case as determined by the Committee.

          (b) “Award” shall mean any Option, Stock Appreciation Right, Restricted Stock, Restricted
Stock Unit, Performance Award, Dividend Equivalent, Other Stock Grant or Other Stock-Based Award
granted under the Plan.

          (c) “Award Agreement” shall mean any written agreement, contract or other instrument or
document evidencing any Award granted under the Plan. Each Award Agreement shall be subject to the
applicable terms and conditions of the Plan and any other terms and conditions (not inconsistent
with the Plan) determined by the Committee.

          (d) “Board” shall mean the Board of Directors of the Company.

          (e) “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, and any
regulations promulgated thereunder.

          (f) “Committee” shall mean a committee of Directors designated by the Board to administer the
Plan. The Committee shall be comprised of not less than such number of Directors as shall be
required to permit Awards granted under the Plan to qualify under Rule 16b-3, and each member of
the Committee shall be a “Non-Employee Director” within the meaning of Rule 16b-3 and an “outside
director” within the meaning of Section 162(m) of the Code. The Company expects to have the Plan
administered in

 

 

accordance with the requirements for the award of “qualified performance-based compensation” within
the meaning of Section 162(m) of the Code.

          (g) “Company” shall mean SoftBrands, Inc., a Delaware corporation, and any successor
corporation.

          (h) “Director” shall mean a member of the Board, including Non-Employee Directors.

          (i) “Dividend Equivalent” shall mean any right granted under Section 6(e) of the Plan.

          (j) “Eligible Person” shall mean any employee, officer, consultant, independent contractor or
Director (including any Non-Employee Director) providing services to the Company or any Affiliate
whom the Committee determines to be an Eligible Person, and transferees of Eligible Persons to the
extent that the transfer is permitted by the Plan and the applicable Award Agreement.

          (k) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

          (l) “Fair Market Value” shall mean, with respect to any property (including, without
limitation, any Shares or other securities), the fair market value of such property determined by
such methods or procedures as shall be established from time to time by the Committee.
Notwithstanding the foregoing, unless otherwise determined by the Committee, the Fair Market Value
of a Share as of a given date shall be,(i) if the Shares are then traded on the New York Stock
Exchange, or on any other national exchange, the closing price of one share as reported in the NYSE
on such date, or (ii) if the Shares are not traded on a national exchange but are then traded on
the Nasdaq National Market System, the last sales price of one Share as reported on the Nasdaq
National Market System on such date, or (iii) if not traded on a national exchange or the Nasdaq
National Market System, the average of the bid and asked quotes reported by the automated quotation
system for such date on the automated quotation system on which the shares are then quoted, or if
not quoted, the average of the bid and asked quotes of a reputable dealer in the Shares on such
date, or (iv) if the Shares are not quoted, the price as is reasonably determined, based, among
other things, on any reported trades in the Shares, by the Committee on such date. With respect to
any date on which the NYSE or the Nasdaq National Market System, or any similar exchange or market
on which the Shares are then traded, is not open for trading, the foregoing Fair Market Value shall
be determined based on the most recent preceding date when such market or exchange is open for
trading.

          (m) “Incentive Stock Option” shall mean an option granted under Section 6(a) of the Plan that
is intended to meet the requirements of Section 422 of the Code or any successor provision.

          (n) “Non-Employee Director” shall mean any Director who is not also an employee of the
Company.

          (o) “Non-Qualified Stock Option” shall mean an option granted under Section 6(a) of the Plan
that is not intended to be an Incentive Stock Option.

          (p) “Option” shall mean an Incentive Stock Option or a Non-Qualified Stock Option.

          (q) “Other Stock Grant” shall mean any right granted under Section 6(f) of the Plan.

          (r) “Other Stock-Based Award” shall mean any right granted under Section 6(g) of the Plan.

          (s) “Participant” shall mean an Eligible Person designated to be granted an Award under the
Plan.

          (t) “Performance Award” shall mean any right granted under Section 6(d) of the Plan.

          (u) “Person” shall mean any individual, corporation, partnership, association or trust.

          (v) “Plan” shall mean the SoftBrands, Inc. 2001 Stock Incentive Plan, as amended from time to
time, the provisions of which are set forth herein.

          (w) “Plan Year” shall mean a consecutive 12-month period ending on December 31 of each year.

          (x) “Reload Option” shall mean any Option granted under Section 6(a)(v) of the Plan.

          (y) “Restricted Stock” shall mean any Shares granted under Section 6(c) of the Plan.

          (z) “Restricted Stock Unit” shall mean any unit granted under Section 6(c) of the Plan
evidencing the right to receive a Share (or a cash payment equal to the Fair Market Value of a
Share) at some future date.

          (aa) “Rule 16b-3” shall mean Rule 16b-3 promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as amended, or any successor rule or regulation.

          (bb) “Securities Act” shall mean the Securities Act of 1933, as amended.

 

 

          (cc) “Share” or “Shares” shall mean shares of common stock, $0.01 par value per share, of the
Company or such other securities or property as may become subject to Awards pursuant to an
adjustment made under Section 4(c) of the Plan.

          (dd) “Stock Appreciation Right” shall mean any right granted under Section 6(b) of the Plan.

Section 3. Administration

          (a) Power and Authority of the Committee. The Plan shall be administered by the
Committee. Subject to the express provisions of the Plan and to applicable law, the Committee
shall have full power and authority to: (i) designate Participants; (ii) determine the type or
types of Awards to be granted to each Participant under the Plan; (iii) determine the number of
Shares to be covered by (or the method by which payments, or other rights are to be calculated in
connection with) each Award; (iv) determine the terms and conditions of any Award or Award
Agreement; (v) amend the terms and conditions of any Award or Award Agreement and accelerate the
exercisability of any Award or the lapse of restrictions relating to any Award; (vi) determine
whether, to what extent and under what circumstances Awards may be exercised in cash, Shares,
promissory notes, other securities, other Awards or other property, or canceled, forfeited or
suspended; (vii) determine whether, to what extent and under what circumstances cash, Shares,
promissory notes, other securities, other Awards, other property and other amounts payable with
respect to an Award under the Plan shall be deferred either automatically or at the election of the
holder thereof or the Committee; (viii) interpret and administer the Plan and any instrument or
agreement, including an Award Agreement, relating to the Plan; (ix) establish, amend, suspend or
waive such rules and regulations and appoint such agents as it shall deem appropriate for the
proper administration of the Plan; and (x) make any other determination and take any other action
that the Committee deems necessary or desirable for the administration of the Plan. Unless
otherwise expressly provided in the Plan, all designations, determinations, interpretations and
other decisions under or with respect to the Plan or any Award shall be within the sole discretion
of the Committee, may be made at any time and shall be final, conclusive and binding upon any
Participant, any holder or beneficiary of any Award and any employee of the Company or any
Affiliate.

          (b) Delegation. The Committee may delegate its powers and duties under the Plan to
one or more Directors or officers of the Company, or to a committee of Directors or officers,
subject to such terms, conditions and limitations as the Committee may establish in its sole
discretion, provided, however, that the Committee shall not delegate its powers and duties under
the Plan (i) with regard to officers or directors of the Company or any Affiliate who are subject
to Section 16 of the Exchange Act or (ii) in such a manner as would cause the Plan not to comply
with the requirements of Section 162(m) of the Code.

 

 

          (c) Power and Authority of the Board. Notwithstanding anything to the contrary
contained herein, the Board may, at any time and from time to time, without any further action of
the Committee, exercise the powers and duties of the Committee under the Plan.

Section 4. Shares Available for Awards

          (a) Shares Available. Subject to adjustment as provided in Section 4(c) of the Plan,
the aggregate number of Shares that may be issued under all Awards under the Plan shall be
15,400,000; provided that, any Shares with respect to which Awards may be issued, but are not
issued, under the Plan in any Plan Year shall be carried forward and shall be available to be
covered by Awards issued in any subsequent Plan Year in which Awards may be issued under the Plan.
Shares to be issued under the Plan may be either authorized but unissued Shares or Shares acquired
in the open market or otherwise. Any Shares that are used by a Participant as full or partial
payment to the Company of the purchase price relating to an Award, or in connection with the
satisfaction of tax obligations relating to an Award, shall again be available for granting Awards
(other than Incentive Stock Options) under the Plan. In addition, if any Shares covered by an
Award or to which an Award relates are not purchased or are forfeited, or if an Award otherwise
terminates without delivery of any Shares, then the number of Shares counted against the aggregate
number of Shares available under the Plan with respect to such Award, to the extent of any such
forfeiture or termination, shall again be available for granting Awards under the Plan.
Notwithstanding the foregoing, the number of Shares available for granting Incentive Stock Options
under the Plan shall not exceed 8,400,000, subject to adjustment as provided in the Plan and
subject to the provisions of Section 422 or 424 of the Code or any successor provision.

          (b) Accounting for Awards. For purposes of this Section 4, if an Award entitles the
holder thereof to receive or purchase Shares, the number of Shares covered by such Award or to
which such Award relates shall be counted on the date of grant of such Award against the aggregate
number of Shares available for granting Awards under the Plan.

          (c) Adjustments. In the event that the Committee shall determine that any dividend or
other distribution (whether in the form of cash, Shares, other securities or other property),
recapitalization, stock split, reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase or exchange of Shares or other securities of the
Company, issuance of warrants or other rights to purchase Shares or other securities of the Company
or other similar corporate transaction or event affects the Shares such that an adjustment is
determined by the Committee to be appropriate in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the Plan, then the Committee
shall, in such manner as it may deem equitable, adjust any or all of (i) the number and type of
Shares (or other securities or other property) that thereafter may be made the subject of Awards,
(ii) the number and type of Shares (or other securities or other property) subject to outstanding
Awards and (iii) the purchase or exercise price with respect to any Award; provided,
however, that the

 

 

number of Shares covered by any Award or to which such Award relates shall always be a whole
number.

          (d) Award Limitations Under the Plan. No Eligible Person may be granted any Award or
Awards under the Plan, the value of which Award or Awards is based solely on an increase in the
value of the Shares after the date of grant of such Award or Awards, for more than 2,000,000 Shares
(subject to adjustment as provided for in Section 4(c) of the Plan), in the aggregate in any
calendar year. The foregoing annual limitation specifically includes the grant of any Award or
Awards representing “qualified performance-based compensation” within the meaning of Section 162(m)
of the Code.

Section 5. Eligibility

     Any Eligible Person shall be eligible to be designated a Participant. In determining which
Eligible Persons shall receive an Award and the terms of any Award, the Committee may take into
account the nature of the services rendered by the respective Eligible Persons, their present and
potential contributions to the success of the Company or such other factors as the Committee, in
its discretion, shall deem relevant. Notwithstanding the foregoing, an Incentive Stock Option may
only be granted to full or part-time employees (which term as used herein includes, without
limitation, officers and Directors who are also employees), and an Incentive Stock Option shall not
be granted to an employee of an Affiliate unless such Affiliate is also a “subsidiary corporation”
of the Company within the meaning of Section 424(f) of the Code or any successor provision.

Section 6. Awards

          (a) Options. The Committee is hereby authorized to grant Options to Eligible Persons
with the following terms and conditions and with such additional terms and conditions not
inconsistent with the provisions of the Plan as the Committee shall determine:

               (i) Exercise Price. The purchase price per Share purchasable under an Option shall be
determined by the Committee; provided, however, that such purchase price shall not
be less than 100% of the Fair Market Value of a Share on the date of grant of such Option.

               (ii) Option Term. The term of each Option shall be fixed by the Committee, but, with
respect to any Incentive Stock Option, shall in no event exceed 10 years from the date on which
such Incentive Stock Option is granted.

               (iii) Time and Method of Exercise. The Committee shall determine the time or times at
which an Option may be exercised in whole or in part and the method or methods by which, and the
form or forms (including, without limitation, cash, Shares, promissory notes, other securities,
other Awards or other property, or any combination thereof, having a Fair Market Value on the
exercise date equal to the

 

 

applicable exercise price) in which, payment of the exercise price with respect thereto may be made
or deemed to have been made.

               (iv) Incentive Stock Options. Notwithstanding anything in the Plan to the contrary,
the following additional provisions shall apply to the grant of stock options which are intended to
qualify as Incentive Stock Options:

     (A) The aggregate Fair Market Value (determined as of the time the
option is granted) of the Shares with respect to which Incentive Stock
Options are exercisable for the first time by any Participant during any
calendar year (under this Plan and all other plans of the Company and its
Affiliates) shall not exceed $100,000.

     (B) All Incentive Stock Options must be granted within ten years from
the earlier of the date on which this Plan was adopted by the Board or the
date this Plan was approved by the shareholders of the Company.

     (C) Unless sooner exercised, all Incentive Stock Options shall expire
and no longer be exercisable no later than 10 years after the date of
grant; provided, however, that in the case of a grant of an Incentive
Stock Option to a Participant who, at the time such Option is granted,
owns (within the meaning of Section 422 of the Code) stock possessing more
than 10% of the total combined voting power of all classes of stock of the
Company or of its Affiliate, such Incentive Stock Option shall expire and
no longer be exercisable no later than 5 years from the date of grant.

     (D) The purchase price per Share for an Incentive Stock Option shall
be not less than 100% of the Fair Market Value of a Share on the date of
grant of the Incentive Stock Option; provided, however, that, in the case
of the grant of an Incentive Stock Option to a Participant who, at the
time such Option is granted, owns (within the meaning of Section 422 of
the Code) stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company or of its Affiliate, the
purchase price per Share purchasable under an Incentive Stock Option shall
be not less than 110% of the Fair Market Value of a Share on the date of
grant of the Inventive Stock Option.

     (E) Any Incentive Stock Option authorized under the Plan shall
contain such other provisions as the Committee shall deem advisable, but
shall in all events be consistent with and contain all provisions required
in order to qualify the Option as an Incentive Stock Option.

               (v) Reload Options. The Committee may grant Reload Options,
separately or together with another Option, pursuant to which, subject to
the terms and conditions established by the Committee, the Participant
would be granted a new Option when the payment of the exercise price of a
previously granted option is made by the delivery of Shares owned by the
Participant pursuant to Section 6(a)(iii) hereof or the relevant
provisions of another plan of the Company, and/or when Shares are tendered
or withheld as payment of the amount to be withheld under applicable
income tax laws in connection with the exercise of an Option, which new
Option would be an Option to purchase the number of Shares not exceeding
the sum of (A) the number of Shares so provided as consideration upon the
exercise of the previously granted option to which such Reload Option
relates and (B) the number of Shares, if any, tendered or withheld as
payment of the amount to be withheld under applicable tax laws in
connection with the exercise of the option to which such Reload Option
relates pursuant to the relevant provisions of the plan or agreement
relating to such option. Reload Options may be granted with respect to
Options previously granted under the Plan or any other stock option plan
of the Company or may be granted in connection with any Option granted
under the Plan or any other stock option plan of the Company at the time
of such grant. Such Reload Options shall have a per share exercise price
equal to Fair Market Value of one Share as of the date of grant of the new
Option. Any Reload Option shall be subject to availability of sufficient
Shares for grant under the Plan. Shares surrendered as part or all of the
exercise price of the Option to which it relates that have been owned by
the optionee less than six months will not be counted for purposes of
determining the number of Shares that may be purchased pursuant to a
Reload Option.

          (b) Stock Appreciation Rights. The Committee is hereby authorized to grant Stock
Appreciation Rights to Eligible Persons subject to the terms of the Plan and any applicable Award
Agreement. A Stock Appreciation Right granted under the Plan shall confer on the holder thereof a
right to receive upon exercise thereof the excess of (i) the Fair Market Value of one Share on the
date of exercise (or, if the Committee shall so determine, at any time during a specified period
before or after the date of exercise) over (ii) the grant price of the Stock Appreciation Right as
specified by the Committee, which price shall not be less than 100% of the Fair Market Value of one
Share on the date of grant of the Stock Appreciation Right. Subject to the terms of the Plan and
any applicable Award Agreement, the grant price, term, methods of exercise, dates of exercise,
methods of settlement and any other terms and conditions of any Stock Appreciation Right shall be
as determined by the Committee. The Committee may impose such conditions or restrictions on the
exercise of any Stock Appreciation Right as it may deem appropriate.

 

 

          (c) Restricted Stock and Restricted Stock Units. The Committee is hereby authorized
to grant Restricted Stock and Restricted Stock Units to Eligible Persons with the following terms
and conditions and with such additional terms and conditions not inconsistent with the provisions
of the Plan as the Committee shall determine:

               (i) Restrictions. Shares of Restricted Stock and Restricted Stock Units shall be
subject to such restrictions as the Committee may impose (including, without limitation, a waiver
by the Participant of the right to vote or to receive any dividend or other right or property with
respect thereto), which restrictions may lapse separately or in combination at such time or times,
in such installments or otherwise as the Committee may deem appropriate.

               (ii) Stock Certificates. Any Restricted Stock granted under the Plan shall be
registered in the name of the Participant and shall bear an appropriate legend referring to the
terms, conditions and restrictions applicable to such Restricted Stock.

               (iii) Forfeiture. Except as otherwise determined by the Committee, upon a
Participant’s termination of employment (as determined under criteria established by the Committee)
during the applicable restriction period, all Shares of Restricted Stock and Restricted Stock Units
held by the Participant at such time shall be forfeited and reacquired by the Company;
provided, however, that the Committee may, when it finds that a waiver would be in
the best interest of the Company, waive in whole or in part any or all remaining restrictions with
respect to Shares of Restricted Stock or Restricted Stock Units.

          (d) Performance Awards. The Committee is hereby authorized to grant Performance
Awards to Eligible Persons subject to the terms of the Plan and any applicable Award Agreement. A
Performance Award granted under the Plan (i) may be denominated or payable in cash, Shares
(including, without limitation, Restricted Stock and Restricted Stock Units), other securities,
other Awards or other property and (ii) shall confer on the holder thereof the right to receive
payments, in whole or in part, upon the achievement of such performance goals during such
performance periods as the Committee shall establish. Subject to the terms of the Plan and any
applicable Award Agreement, the performance goals to be achieved during any performance period, the
length of any performance period, the amount of any Performance Award granted, the amount of any
payment or transfer to be made pursuant to any Performance Award and any other terms and conditions
of any Performance Award shall be determined by the Committee.

          (e) Dividend Equivalents. The Committee is hereby authorized to grant Dividend
Equivalents to Eligible Persons under which the Participant shall be entitled to receive payments
(in cash, Shares, other securities, other Awards or other property as determined in the discretion
of the Committee) equivalent to the amount of

 

 

cash dividends paid by the Company to holders of Shares with respect to a number of Shares
determined by the Committee. Subject to the terms of the Plan and any applicable Award Agreement,
such Dividend Equivalents may have such terms and conditions as the Committee shall determine.

          (f) Other Stock Grants. The Committee is hereby authorized, subject to the terms of
the Plan and any applicable Award Agreements, to grant to Eligible Persons Shares without
restrictions thereon as are deemed by the Committee to be consistent with the purpose of the Plan.

          (g) Other Stock-Based Awards. The Committee is hereby authorized to grant to Eligible
Persons, subject to the terms of the Plan and any applicable Award Agreements, such other Awards
that are denominated or payable in, valued in whole or in part by reference to, or otherwise based
on or related to, Shares (including, without limitation, securities convertible into Shares), as
are deemed by the Committee to be consistent with the purpose of the Plan. Shares or other
securities delivered pursuant to a purchase right granted under this Section 6(g) shall be
purchased for such consideration, which may be paid by such method or methods and in such form or
forms (including, without limitation, cash, Shares, promissory notes, other securities, other
Awards or other property or any combination thereof), as the Committee shall determine, the value
of which consideration, as established by the Committee, shall not be less than 100% of the Fair
Market Value of such Shares or other securities as of the date such purchase right is granted.

          (h) General

               (i) No Cash Consideration for Awards. Awards shall be granted for no cash
consideration or for any cash or other consideration as may be determined by the Committee or
required by applicable law.

               (ii) Awards May Be Granted Separately or Together. Awards may, in the discretion of
the Committee, be granted either alone or in addition to, in tandem with or in substitution for any
other Award or any award granted under any plan of the Company or any Affiliate other than the
Plan. Awards granted in addition to or in tandem with other Awards or in addition to or in tandem
with awards granted under any such other plan of the Company or any Affiliate may be granted either
at the same time as or at a different time from the grant of such other Awards or awards.

               (iii) Forms of Payment under Awards. Subject to the terms of the Plan and of any
applicable Award Agreement, payments or transfers to be made by the Company or an Affiliate upon
the grant, exercise or payment of an Award may be made in such form or forms as the Committee shall
determine (including, without limitation, cash, Shares, promissory notes, other securities, other
Awards or other property or any combination thereof), and may be made in a single payment or
transfer, in installments or on a deferred basis, in each case in accordance with rules and
procedures established by the Committee. Such rules and procedures may include,

 

 

without limitation, provisions for the payment or crediting of reasonable interest on installment
or deferred payments or the grant or crediting of Dividend Equivalents with respect to installment
or deferred payments.

               (iv) Limits on Transfer of Awards. No Award (other than Other Stock Grants) and no
right under any such Award shall be transferable by a Participant otherwise than by will or by the
laws of descent and distribution and the Company shall not be required to recognize any attempted
assignment of such rights by any Participant; provided, however, that, if so determined by the
Committee, a Participant may, in the manner established by the Committee, designate a beneficiary
or beneficiaries to exercise the rights of the Participant and receive any property distributable
with respect to any Award upon the death of the Participant; and provided, further, that, except in
the case of an Incentive Stock Option, Awards may be transferable as specifically provided in any
applicable Award Agreement or amendment thereto pursuant to terms determined by the Committee. The
transferee shall remain subject to all the terms and conditions applicable to the Award prior to
such transfer. The foregoing right to transfer the Award shall apply to the right to consent to
amendments to the Award Agreement and, in the discretion of the Committee, shall also apply to the
right to transfer ancillary rights associated with the Award. Except as otherwise provided in any
applicable Award Agreement or amendment thereto (other than an Award Agreement relating to an
Incentive Stock Option), pursuant to terms determined by the Committee, each Award or right under
any Award shall be exercisable during the Participant’s lifetime only by the Participant or, if
permissible under applicable law, by the Participant’s guardian or legal representative. In the
event of a transfer of the Award, the Award shall be exercisable by the transferee only to the
extent, and only for term, as fixed by the Committee for the original Participant. Except as
otherwise provided in any applicable Award Agreement or amendment thereto (other than an Award
Agreement relating to an Incentive Stock Option), no Award or right under any such Award may be
pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation,
attachment or encumbrance thereof shall be void and unenforceable against the Company or any
Affiliate.

               (v) Term of Awards. The term of each Award shall be for such period as may be
determined by the Committee; provided, however, that in the case of an Incentive Stock Option such
Option shall not be exercisable after the expiration of 10 years from the date such Option is
granted.

               (vi) Restrictions; Securities Exchange Listing. All Shares or other securities
delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such
restrictions as the Committee may deem advisable under the Plan, applicable federal or state
securities laws and regulatory requirements, and the Committee may cause appropriate entries to be
made or legends to be placed on the certificates for such Shares or other securities to reflect
such restrictions. If the Shares or other securities of the Company are traded on a securities
exchange, the Company shall not be required to deliver any Shares or other securities covered by an
Award unless and until such Shares or other securities have been admitted for trading on such
securities exchange.

 

 

Section 7. Amendment and Termination; Adjustments

          (a) Amendments to the Plan. The Board may amend, alter, suspend, discontinue or
terminate the Plan at any time; provided, however, that, notwithstanding any other provision of the
Plan or any Award Agreement, without the approval of the shareholders of the Company, no such
amendment, alteration, suspension, discontinuation or termination shall be made that, absent such
approval:

               (i) would violate the rules or regulations of the NASDAQ National Market System (if applicable
to the Company) or any other securities exchange that are applicable to the Company; or

               (ii) would cause the Company to be unable, under the Code, to grant Incentive Stock Options
under the Plan.

          (b) Amendments to Awards. The Committee may waive any conditions of or rights of the
Company under any outstanding Award, prospectively or retroactively. Except as otherwise provided
herein or in an Award Agreement, the Committee may not amend, alter, suspend, discontinue or
terminate any outstanding Award, prospectively or retroactively, if such action would adversely
affect the rights of the holder of such Award, without the consent of the Participant or holder or
beneficiary thereof.

          (c) Correction of Defects, Omissions and Inconsistencies. The Committee may correct
any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the
manner and to the extent it shall deem desirable to carry the Plan into effect.

Section 8. Income Tax Withholding

     In order to comply with all applicable national, federal, state or local income tax laws or
regulations, the Company may take such action as it deems appropriate to ensure that all applicable
national, federal, state or local payroll, withholding, income or other taxes, which are the sole
and absolute responsibility of a Participant, are withheld or collected from such Participant. In
order to assist a Participant in paying all or a portion of the national, federal, state and local
taxes to be withheld or collected upon exercise or receipt of (or the lapse of restrictions
relating to) an Award, the Committee, in its discretion and subject to such additional terms and
conditions as it may adopt, may permit the Participant to satisfy such tax obligation by (i)
electing to have the Company withhold a portion of the Shares otherwise to be delivered upon
exercise or receipt of (or the lapse of restrictions relating to) such Award with a Fair Market
Value equal to the amount of such taxes or (ii) delivering to the Company Shares other than Shares
issuable upon exercise or receipt of (or the lapse of restrictions relating to) such Award with a
Fair Market Value equal to the amount of such taxes. The election, if any, must be made on or
before the date that the amount of tax to be withheld is determined.

 

 

Section 9. General Provisions

          (a) No Rights to Awards. No Eligible Person, Participant or other Person shall have
any claim to be granted any Award under the Plan, and there is no obligation for uniformity of
treatment of Eligible Persons, Participants or holders or beneficiaries of Awards under the Plan.
The terms and conditions of Awards need not be the same with respect to any Participant or with
respect to different Participants.

          (b) Award Agreements. No Participant will have rights under an Award granted to such
Participant unless and until an Award Agreement shall have been duly executed on behalf of the
Company and, if requested by the Company, signed by the Participant.

          (c) Plan Provisions Control. In the event that any provision of an Award Agreement
conflicts with or is inconsistent in any respect with the terms of the Plan as set forth herein or
subsequently amended, the terms of the Plan shall control.

          (d) No Rights of Shareholders. Except with respect to Shares of Restricted Stock as
to which the Participant has been granted the right to vote, neither a Participant nor the
Participant’s legal representative shall be, or have any of the rights and privileges of, a
stockholder of the Company with respect to any Shares issuable to such Participant upon the
exercise or payment of any Award, in whole or in part, unless and until such Shares have been
issued in the name of such Participant or such Participant’s legal representative without
restrictions thereto.

          (e) No Limit on Other Compensation Arrangements. Nothing contained in the Plan shall
prevent the Company or any Affiliate from adopting or continuing in effect other or additional
compensation arrangements, and such arrangements may be either generally applicable or applicable
only in specific cases.

          (f) No Right to Employment. The grant of an Award shall not be construed as giving a
Participant the right to be retained in the employ of the Company or any Affiliate, nor will it
affect in any way the right of the Company or an Affiliate to terminate such employment at any
time, with or without cause. In addition, the Company or an Affiliate may at any time dismiss a
Participant from employment free from any liability or any claim under the Plan or any Award,
unless otherwise expressly provided in the Plan or in any Award Agreement. Nothing in this Plan
shall confer on any person any legal or equitable right against the Company or any Affiliate,
directly or indirectly, or give rise to any cause of action at law or in equity against the Company
or an Affiliate. The Awards granted hereunder shall not form any part of the wages or salary of
any Eligible Person for purposes of severance pay or termination indemnities, irrespective of the
reason for termination of employment. Under no circumstances shall any person ceasing to be an
employee of the Company or any Affiliate be entitled to any compensation for any loss of any right
or benefit under the Plan which such employee might otherwise have enjoyed but for termination of
employment, whether such

 

 

compensation is claimed by way of damages for wrongful or unfair dismissal, breach of contract or
otherwise. By participating in the Plan, each Participant shall be deemed to have accepted all the
conditions of the Plan and the terms and conditions of any rules and regulations adopted by the
Committee and shall be fully bound thereby.

          (g) Governing Law. The validity, construction and effect of the Plan or any Award,
and any rules and regulations relating to the Plan or any Award, shall be determined in accordance
with the internal laws, and not the law of conflicts, of the State of Minnesota.

          (h) Severability. If any provision of the Plan or any Award is or becomes or is
deemed to be invalid, illegal or unenforceable in any jurisdiction or would disqualify the Plan or
any Award under any law deemed applicable by the Committee, such provision shall be construed or
deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended
without, in the determination of the Committee, materially altering the purpose or intent of the
Plan or the Award, such provision shall be stricken as to such jurisdiction or Award, and the
remainder of the Plan or any such Award shall remain in full force and effect.

          (i) No Trust or Fund Created. Neither the Plan nor any Award shall create or be
construed to create a trust or separate fund of any kind or a fiduciary relationship between the
Company or any Affiliate and a Participant or any other Person. To the extent that any Person
acquires a right to receive payments from the Company or any Affiliate pursuant to an Award, such
right shall be no greater than the right of any unsecured general creditor of the Company or any
Affiliate.

          (j) Other Benefits. No compensation or benefit awarded to or realized by any
Participant under the Plan shall be included for the purpose of computing such Participant’s
compensation under any compensation-based retirement, disability, or similar plan of the Company
unless required by law or otherwise provided by such other plan.

          (k) No Fractional Shares. No fractional Shares shall be issued or delivered pursuant
to the Plan or any Award, and the Committee shall determine whether cash shall be paid in lieu of
any fractional Shares or whether such fractional Shares or any rights thereto shall be canceled,
terminated or otherwise eliminated.

          (l) Headings. Headings are given to the Sections and subsections of the Plan solely
as a convenience to facilitate reference. Such headings shall not be deemed in any way material or
relevant to the construction or interpretation of the Plan or any provision thereof.

Section 10. Effective Date of the Plan

     The Plan shall be effective as of December 13, 2001, subject to approval by the shareholders
of the Company within one year thereafter.

 

 

Section 11. Term of the Plan

     No Award shall be granted under the Plan after December 13, 2011 or any earlier date of
discontinuation or termination established pursuant to Section 7(a) of the Plan. However, unless
otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award theretofore
granted may extend beyond such date, and the authority of the Committee provided for hereunder with
respect to the Plan and any Awards, and the authority of the Board to amend the Plan, shall extend
beyond the termination of the Plan.

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