Document:

cswg10k20100630ex10-2.htm

Exhibit 10.2

English Translation of the Cooperation Agreement

 Agreement No.: SY (2009) 001

Party A: Heilongjiang SenYu Animal Husbandry Co., Ltd.

Legal Representative: Shang Zhenyu

Party B: Heilongjiang Wangda Fodder Co., Ltd.

Legal Representative: Dou Beijun

    To improve the comprehensive cooperation relationship between the two parties, and the promotion of Party A’s cultivation model of “Company Base Farmer”, Party A and Party B, on the basis of adhering to the principle of equality, mutual benefit and honesty, and after full consultations and negotiations, have reached the following agreement regarding to the cooperation issues, cooperation models, etc, and committed to strictly abiding by the terms of this agreement and performing the obligations of each party.

PART ONE   GENERAL PROVISIONS

	
1.

	
The aim of this agreement is to promote Party A’s cultivation model of “Company Base Farmer” within Heilongjiang region, thus to reduce the production cost, increase both parties’ profit, and achieve the win-win goal for both parties.

	
2.

	
Under the cultivation model of “Company Base Farmer” referred by this agreement, a close cooperation relationship is established between the two parties. Party B will sell its fodder on credit to the farmers who purchase “Topigs” or “Canadian” pigs from Party A, Party B should sign a credit sale agreement with the farmers, and agree on that when slaughtering the commercial hogs, the farmers will gain 40% of the profit after deducting the breeding cost.

	
3.

	
Methods to confirm the fodder price and credit sale amount: Both parties have jointly confirmed that the fodder price of credit sale is 2240 RMB per ton, on the basis that the average cost of production of the fodder produced by Party B (full price fodder) is 2040 RMB per ton, combined the fixed profit which is 200 RMB per ton. Further negotiation will be taken place between the two parties and the price will be confirmed in supplemental agreement if the price of raw materials has arisen for more than 6%; the fodder amount of the credit sale is 288 kilogram for each commercial hog. The price and credit sale amount above should be the settlement basis with the farmers.

  

  

  

 

	
4.

	
Agreement scope: To ensure the quality and quantity of the commercial hogs Party B retrieves and its financial planning, Party B should only sell its fodder on credit and pay the profits to the farmers under the cultivation model of “Company Basis Farmers”.

	
5.

	
For the better performance of both parties’ obligations under the agreement, Party A will accredit personalities to Party B, including warehouse keepers and liaisons, on its own expenses, and could increase or replace the personalities as required at any time.

	
6.

	
Both parties should closely pay attention to the commissariat price, Party B should communicate with Party A in time when the commissariat price is lower during the year, and choose the chance to stock fodder raw materials after negotiation to reduce the cost.

	
7.

	
During the cooperation period, Party B should designate certain person to keep communicating and exchanging information with other cooperators under the cultivation model of “Company Basis Farmers”, to ensure the well execution of the cooperation and the operation of the production system.

	
8.

	
Methods to coordinate and supervise the execution of the agreement:

	
  

	
(1)

	
Party A will accredit warehouse keepers to both the Party B’s warehouses of raw materials and products, and jointly supervise the storage of the fodder raw materials as well as the fodder for credit sale.

	
  

	
(2)

	
The liaisons from Party A are responsible for supervising the purchase price of Party B’s raw materials.

Party B should fully cooperate with the personalities from Party A without any interferences.

  

  

  

	
9.

	
The loss of each pig during short-distance transport is 1.5 kilo in winter, 2.5 kilo in summer, the winter starts from October 30th every year and ends on April 30th of the next year; the summer starts from May 1st and ends on October 29th every year, and the excess part is borne by Party B.

	
10.

	
The retrieving price will be confirmed according to the local county-level market price, and the rank will be confirmed as live pigs.

	
11.

	
Payment by Party A:

	
  

	
(1)

	
During the execution of the agreement, after pre-paying for the purchase of raw materials, Party B has the right to ask Party A to pay for the pre-purchase, which should be paid within three working days without any mistakes identified by Party A.

	
  

	
(2)

	
When stocking large amount of raw materials is necessary, both parties should further negotiate on the mode and amount of the payment based on the condition at that time, and sign the supplemental agreement in written.

	
  

	
(3)

	
On the phase of retrieving commercial hogs, Party B should pay the 40% profits to the farmers and fodder cost of the sow in advance. Party A will pay the retrieving price with the confirmation letter issued by its personality after delivering the commercial hogs to its transportation base.

	
  

	
(4)

	
The two parties both have agreed that after paying retrieving price in advance, the two parties should arrange the settlement, and Party A should pay within three working days after receiving any certificate of payment from Party B.

PART TWO    RIGHTS AND OBLIGATIONS

	
12.

	
Rights of Party A:

	
  

	
(1)

	
Party A has the right to supervise the fodder distribution process, as well as the quantity and quality by Party B.

	
  

	
(2)

	
The payment by Party A will be once a week in principle and Party A keeps the right to pay immediately under special circumstances.

  

  

  

	
  

	
(3)

	
Party A has the right to ask Party B retrieve commercial hogs in time, the right to accept all the commercial hogs Party B has retrieved, and the right to refuse any substandard ones.

	
  

	
(4)

	
Party A has the right to jointly check the fodder cost with Party B.

	
13.

	
Obligations of Party A:

	
  

	
(1)

	
Party A should pay the fodder price according to the agreement.

	
  

	
(2)

	
Party A should pay Party B the profit divided to the farmers as well as the sows’ fodder cost after Party B retrieving commercial hogs.

	
  

	
(3)

	
Party A should accept standard commercial hogs Party B has delivered in time.

	
  

	
(4)

	
Party A should pay short-distance transport cost at the price of 10 RMB per pig to Party B, which has already been a part of fodder cost without any further payment.

	
14.

	
Rights of Party B:

	
  

	
(1)

	
Party B has the right to ask Party A to pay fodder price, fodder fixed profit and the profit divided to the farmers.

	
  

	
(2)

	
Party B has the right to suggest Party A to stock fodder raw materials when the time is appropriate.

	
  

	
(3)

	
Party B has the right to retrieve commercial hogs on behalf of itself.

	
15.

	
Obligations of Party B:

	
  

	
(1)

	
Party B should be responsible for paying the fodder price and the fodder cost when retrieving live pigs from farmers, as well as the 40% divided profit in advance. The application of payment should be issued after that. Party B should report the fodder usage plan and amount of retrieving commercial hogs a week before, so that Party A could be prepared for the payment in advance.

	
  

	
(2)

	
Party B should deliver the commercial hogs to Party A’s transportation base.

	
  

	
(3)

	
Party B should pay due attention to the standard of commercial hogs during the retrieving. The delivery fee should be boned by Party B if the commercial hogs are rejected because of substandard.

  

  

  

	
  

	
(4)

	
Party B should notice Party A’s carrier the designated place two working days before the delivery.

	
  

	
(5)

	
Party B is responsible for ensuring the fodder quality and quantity as well as the delivery time.

	
  

	
(6)

	
During the retrieving process, due attention should be paid. Party B is responsible for recording the quality and weight of the commercial hogs accurately.

	
  

	
(7)

	
It is Party B’s responsibility to use its own sale network to provide after-sale service to the farmers, to guarantee that the information on fodder usage amount and retrieving commercial hogs will be reported to Party A in time, and try to report the relevant data constantly.

PART THREE    RISKS

	
16.

	
None of the two parties is responsible for the breach of the agreement under the condition of force majeure, e.g. earthquakes, floods, wars, and any other condition which leads to the incapability of performing the agreement.

	
17.

	
The farmers should bear the risk of commercial hogs’ death during the breeding process, and be responsible for paying the fodder cost of the credit sale. Party B should claim its legal rights in time. If the farmers are incapable of paying, then Party B is directly responsible for the payment.

	
18.

	
During the breeding process, if the commercial hogs are substandard under the condition of fully provided fodder by Party B, Party B should allow the farmers to keep breeding, until the commercial hogs reach the retrieving standard, and the fodder price during this period is the cost price of the fodder. Party B should sign a separate agreement regarding to this period, but the fodder will be sold to farmers directly by Party B, Party A is not involved.

PART FOUR   LIABILITY FOR BREACH OF THE AGREEMENT

	
19.

	
Both parties should perform the agreement strictly abiding by the terms of this agreement. If any large-scale breach of agreement occurs, the one who breaches the agreement should pay the other party default fine at the price of 20% of the first year’s total price of the agreement.

  

  

  

If Party B breaches the agreement and affects the promotion of the “Company Basis Farmers” cultivation model, all the creditor’s rights based on the credit sale agreement of fodder between Party B and the farmers as well as the supplementary agreement will be assigned to Party A. This term will be effective right after two times notice in written from Party A, and no more agreement on creditor’s right subrogation is necessary. For Party A’s convenience, Party B should transfer relative documents to Party A within 10 working days after this term becomes effective, and notice the debtors as well as provide any convenience which is needed.

If Party B breaches the agreement, both term one and term two is effective without coming into conflict.

If Party A breaches the agreement, who is incapable of paying Party B the fodder cost or retrieving cost, and exceeds 15 days after the due day, Party B has the right to claim the fundamental breach of the agreement by Party A, and has the right to rescind the agreement and claim Party A for compensations on the losses resulted from breaching the agreement.

	
20.

	
After certain appraisal, if the death of the pigs results from fodder quality, the losses are boned by Party B, including the fodder cost pre-paid by Party A, fodder cost of farmers and other relative direct as well as indirect losses.

PART FIVE   MISCELLANEOUS

	
21.

	
Both parties should be confidential to any term and information regarding to the agreement, without disclosing to the third party. The one who discloses the agreement to the third party and cause losses to the other party should pay at the price of 20% of the first year’s total price of the agreement.

	
22.

	
Any invalid condition occurs regarding to the whole or part of the agreement, will not affect the effect of the PART SIX and PART SEVEN.

	
23.

	
Any agreement reached between the parties of the agreement and other related parties under the model should be taken place under the system, and any other terms which are conflicted to this agreement will be deemed as breach of agreement.

  

  

  

	
24.

	
The other related parties under the model should share the information on breeding pigs sale, fodder delivery and retrieving commercial hogs unconditionally, and take the supervision unconditionally from other related parties.

	
25.

	
Definitions:

	
  

	
(1)

	
Commercial hogs: edible pigs which are breed under the cultivation model of “Company Basis Farmers” and sell directly to slaughter enterprises. The standard of retrieving is 95 kilo to 110 kilo per pig.

	
  

	
(2)

	
Fodder: full price fodder which is necessary for breeding commercial hogs, including aperture materials, piglets’ materials and developed materials, all the fodder above must achieve the nutrition standard and energy standard designated by Party A.

	
  

	
(3)

	
Short-distance transport: transport taken place by Party A by using Party B’s delivery network, from Party B retrieves commercial hogs under the model to deliver them to Party A’s carrier, usually less than 100 kilometers.

	
  

	
(4)

	
Transport losses: weight losses during the process of retrieving commercial hogs by Party B.

	
  

	
(5)

	
Delivery addresses designated by Party A: the place Party A chooses and accepts commercial hogs according to Proximity among the places designated by Party B after receiving notice, which is an uncertain place.

	
  

	
(6)

	
Breeding cost: fodder cost of commercial hogs and breeding pigs, fodder for each breeding pig is estimated as 1.095 ton per year, which is approximately 150RMB each commercial hog (the cost will change with the change of raw material price).

	
PART SIX   MODIFICATION, TERMINATION, RESCINDATION AND TRANSFER OF THE AGREEMENT

	
26.

	
No party shall unilaterally modify this agreement, any issues not mentioned in this agreement should be reached in supplemental agreement after negotiation between two parties, if any conflict between supplemental agreement and this agreement occurs, the supplemental agreement should be taken as valid and binging. But the agreement will keep valid and binding before the supplemental agreement is signed.

  

  

  

	
27.

	
The agreement will be terminated under the following conditions:

	
  

	
(1)

	
The parties may dissolve the agreement upon consensus through consultation.

	
  

	
(2)

	
The expiration date of the agreement has arrived.

	
  

	
(3)

	
The aim of the agreement cannot be attained because of force majeure.

	
  

	
(4)

	
The cultivation model of “Company Basis Farmers” is not accord with the demands of the market, no further operation is possible.

	
28.

	
The agreement will be rescinded under the following conditions:

	
  

	
(1)

	
Unilateral fundamental breach of the agreement and thus makes realization of the aim of the agreement impossible, or any major accident due to negligence occurs which leads to enough reason for the other party to believe the responsible party is incapable of performing the agreement.

	
  

	
(2)

	
Other related parties breach the agreement and thus leads to the parties of this agreements incapable of performing the agreement.

	
  

	
(3)

	
Emergency occurs and leads to the foundation of the cooperation vanish.

	
29.

	
Both of the two parties have agreed that not transferring whole or part of the rights and obligations of this agreement to the third party.

PART SEVEN   JURISDICTIONS

	
30.

	
During the performance period of the agreement, any misunderstanding on the terms of the agreement or any dispute on the performance of the agreement should be resolved by means of friendly consultation and negotiation. If no agreement could be achieved by consultation or negotiation, the parties may initiate an action in the people’s court where the agreement is signed. The agreement is signed at Jiamusi, Heilongjiang Province.

PART EIGHT   VADILITY AND PERIOD OF THE AGREEMENT

  

  

  

 

	
31.

	
There are four originals of the agreement, and each party shall take two, which has equal legal binding effect. Supplemental attachment is an inseparable part of this agreement with equal legal binding effect. The agreement will be taken into effect from January 1st, 2009.

	
32.

	
Agreement term: This agreement is a timeless agreement.

	
33.

	
The cooperation agreement signed between two parties on October 11th, 2007 terminates automatically. If any conflict between the supplementary agreements according to the former agreement and this agreement occurs, this agreement should be taken as valid and binding, other issues not mentioned in this agreement will keep valid and binding.

Party A: Heilongjiang SenYu Animal Husbandry Co., Ltd.

 (Signature)

Party B: Heilongjiang Wangda Fodder Co., Ltd.

(Signature)

 

	  	
December 30th, 2008,

	  	
Jiamusi, Heilongjiang ProvinceExhibit 10.5

 

SECOND
AMENDED AND RESTATED FERRELLGAS UNIT OPTION PLAN

 

SECTION 1.  PURPOSE

 

The
Ferrellgas Unit Option Plan was adopted effective as of August 1, 1994 and
amended and restated effective as of March 1, 1995.  This Second Amended and Restated Ferrellgas
Unit Option Plan (the “Plan”) amends and restates in its entirety those prior
plans effective as of April 19, 2001 (the “Amendment Effective Date”).  Some capitalized terms are defined in Section 10
of this Plan.  This Plan is adopted by
Ferrellgas Partners, L.P., a Delaware limited partnership (the “Partnership”),
to encourage selected Employees of Ferrellgas, Inc., a Delaware
corporation and the general partner of the Partnership (the “Company”), to
develop a proprietary interest in the growth and performance of the
Partnership, to generate an increased incentive to contribute to the
Partnership’s future success and prosperity, thus enhancing the value of the
Partnership for the benefit of its unitholders, and to enhance the ability of
the Company to attract and retain key individuals who are essential to the
progress, growth and profitability of the Partnership, by giving such Employees
the opportunity to acquire Common Units.

 

SECTION 2.  ADMINISTRATION

 

The
Plan shall be administered by the Option Committee of the Board of Directors of
the Company (“the Board”) as designated by the Board to administer the Plan and
composed of not less than two directors of the Board, each of whom is a “non-employee
directors” within the meaning of Rule 16b-3.  A majority of the Committee shall constitute a
quorum, and the acts of a majority of the members present at any meeting at
which a quorum is present, or acts approved in writing by all members of the
Committee, shall be deemed the acts of the Committee.

 

Subject
to the terms of the Plan and applicable law, the Committee shall have the sole
power, authority and discretion to: (i) designate the Employees who are to
be Participants; (ii) determine the number of Options to be granted to an
Employee; (iii) determine the terms and conditions of any Option; (iv) interpret,
construe and administer the Plan and any instrument or agreement relating to an
Option granted under the Plan; (v) 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; (vi) make a
determination as to the right of any Person to receive payment of (or with
respect to) an Option; and (vii) make any other determinations and take
any other actions that the Committee deems necessary or desirable for the
administration of the Plan.

 

Except
to the extent prohibited by applicable law or the applicable rules of a
stock exchange, the Committee may allocate all or any portion of its
responsibilities and powers to any one or more of its members and may delegate
all or any part of its responsibilities and powers to any person or persons
selected by it.  Any such allocation or
delegation may be revoked by the Committee at any time.

 

The
Company and the Partnership shall furnish the Committee with such data and
information as it determines may be required for it to discharge its
duties.  The records of the Company and
the Partnership as to an employee’s or Participant’s employment (or other
provision of services), termination of employment (or cessation of the
provision of services), leave of absence, reemployment and compensation shall
be conclusive on all Persons unless determined to be 

 

 

incorrect.  Participants and other persons entitled to
benefits under the Plan must furnish the Committee such evidence, data or
information as the Committee considers desirable to carry out the terms of the
Plan.

 

Unless
otherwise expressly provided in the Plan, all designations, determinations,
interpretations, and other decisions with respect to the Plan or any Option
granted thereunder shall be within the sole discretion of the Committee, may be
made at any time, and shall be final, conclusive, and binding upon all Persons.

 

SECTION 3.  UNITS AVAILABLE FOR OPTIONS

 

3.1           CALCULATION OF NUMBER OF COMMON UNITS AVAILABLE.  The number of Common Units available for
granting Options under the Plan shall be 1,350,000 Common Units, subject to
adjustment as provided in Section 3.3. 
Further, if any Option granted under the Plan is forfeited, canceled,
surrendered, or otherwise terminates or expires without the delivery of Common
Units or other consideration, then the Common Units subject to such Option
shall again be available for granting Options under the Plan.  To comply with the rules of the New York
Stock Exchange, no single officer or director may acquire under the Plan more
than one percent (1%) of the 31,489,516 outstanding Common Units as of the
Amendment Effective Date, for a limitation of no more than 314,895 Common
Units.  In addition, all Common Units
available for issuance under this Plan together with any Common Units available
for issuance under any other employee benefit plan of the Partnership shall not
exceed five percent (5%) of the Partnership’s 31,489,516 outstanding Common
Units as of Amendment Effective Date, for a limitation of 1,574,475 Common
Units.

 

3.2            SOURCES OF UNITS DELIVERABLE UNDER OPTIONS.  Common Units delivered by the Partnership on
exercise of an Option may consist, in whole or in part, of Common Units
acquired in the open market or from any Person.

 

3.3           ADJUSTMENTS.  In the
event that (i) any change is made to the Common Units issuable under the
Plan or (ii) the Partnership makes any distribution of cash, Common Units
or other property to unitholders which results from the sale or disposition of
a major asset or separate operating division of the Partnership or any other
extraordinary event and, in the judgment of the Committee, such change or
distribution would significantly dilute the rights of Participants hereunder,
then the Committee may make appropriate adjustments in the maximum number of
Units issuable under the Plan to reflect the effect of such change or
distribution upon the Partnership’s capital structure, and may make appropriate
adjustments to the number of Units subject to, and/or the exercise price of,
each outstanding Option.  The adjustments
determined by the Committee shall be final, binding and conclusive.

 

3.4           SUBORDINATED UNITS. 
Under the Original Plan, the Options were exercisable into Subordinated
Units.  As of August 1, 1999, all
Subordinate Units converted into Common Units. 
Any Options previously outstanding as of that date were automatically
converted into Options with respect to Common Units.

 

2

 

SECTION 4.  ELIGIBILITY

 

Any
Employee who is not a member of the Committee shall be eligible to be a
Participant.  Grants may be made to the
same Employee on more than one occasion.

 

SECTION 5.  OPTIONS

 

5.1           OPTION TERMS.  The
Committee is hereby authorized to grant Options to Employees with the following
terms and conditions and with such additional terms and conditions, which are
not inconsistent with the provisions of the Plan, as the Committee shall
determine:

 

(i)            EXERCISE PRICE. 
The per Unit exercise price of an Option shall be determined by the
Committee at the date of grant.

 

(ii)           TIME AND METHOD OF VESTING OR EXERCISE, The Committee
shall determine the time or times at which an Option may become vested in whole
or in part, may be exercised in whole or in part, and the method by which
payment of the exercise price with respect thereto may be made; provided,
however, no Option shall be exercisable within six months of its date of
grant.  Subject to any limitations in the
Option Agreement, a Participant may purchase Common Units subject to the vested
and exercisable portion of an Option in whole at any time, or in part from time
to time, by delivering to the Chief Financial Officer of the Company, on behalf
of the Partnership, written notice specifying the number of Common Units with
respect to which the Option is being exercised, together with payment in full
of the purchase price of such Common Units plus any applicable federal, state
or local taxes for which the Partnership has a withholding obligation in
connection with such purchase.  Such
payment shall be payable in full in cash or by check acceptable to the Company.

 

(iii)          TERM OF OPTIONS.  The
term of each Option shall be for such period as may be determined by the Committee;
provided, however, that in no event shall the term of any Option exceed a
period of 10 years from the date of its grant.

 

(iv)          TERMINATION OF EMPLOYMENT. 
Options, to the extent vested as of the date the Participant ceases to
be an Employee, will remain the property of the Participant until such Options
are exercised pursuant to the Plan or expire by their terms.  Options, to the extent not vested as of the
date the Participant ceases to be an Employee, shall be automatically canceled
unexercised on such date.

 

(v)           LIMITS ON TRANSFER OF OPTIONS.  No Option or rights thereunder shall be
assignable, alienable, saleable or transferable by a Participant otherwise than
by will or by the laws of descent and distribution.  Each Option shall be exercisable during that
Participant’s lifetime only by the Participant or, if permissible under
applicable law, by the Participant’s guardian or legal representative.  No Option or any rights thereunder may be
pledged, alienated, attached or otherwise encumbered, and any purported pledge,
alienation, attachment or encumbrance thereof shall be void and unenforceable
against the Partnership and the Company.

 

3

 

(vi)          UNIT CERTIFICATES. 
Upon exercise of an Option, delivery of a certificate for fully paid and
nonassessable Common Units shall be made to the Person exercising the Option
either at such time during ordinary business hours after 15 days but not more
than 30 days from the date of receipt of the notice by the Partnership as shall
be designed in such notice, or at such time, place and manner as may be agreed
upon by the Partnership and the Person exercising the Option.

 

(vii)         OPTION AGREEMENT. 
Each Option shall be evidenced by an Option Agreement, which shall have
such terms and provisions, not inconsistent with the Plan, that the Committee
determines.

 

5.2           OPTION CANCELLATION RIGHTS.  Notwithstanding anything in the Plan to the
contrary, the Committee shall have the discretion to cancel all or part of any
outstanding Options at any time or times. 
Upon any such cancellation the Partnership shall pay to the Participant
with respect to each Common Unit that is subject to the canceled (or canceled
portion of the) Option an amount in cash equal to the excess, if any, of (i) the
Fair Market Value of a Common Unit (at the effective date of such cancellation)
over (ii) the exercise price per Common Unit of such canceled Option.

 

SECTION 6.  AMENDMENT AND TERMINATION

 

(i)            The Board in its discretion may terminate the Plan at any
time with respect to any Common Units for which a grant has not theretofore
been made.  The Board shall also have the
right to alter or amend the Plan or any part thereof from time to time;
provided, however, that no change in any Option theretofore made may be made
which would impair the rights of the Participant without the consent of such
Participant.

 

SECTION 7.  VESTING UPON THE OCCURRENCE OF CERTAIN EVENTS

 

If
a plan of complete dissolution of the Partnership is adopted or the unitholders
approve an agreement for the sale or disposition by the Partnership (in one
transaction or a series of transactions) of all or substantially all the
Partnership’s assets then upon such adoption or approval all or a portion (as
determined by the Committee and set forth in the related Option Agreement) of a
Participant’s Options outstanding as of the date of such adoption or approval
shall be immediately and fully vested and exercisable and may be exercised
within one year from the date of such adoption or approval, but not thereafter;
provided, however, that if, on any date during such year the Participant
desires to exercise those Options, such Participant cannot exercise such
Options and sell all of the Common Units issuable upon such exercise without
being subject to liability under Section 16(b) of the 1934 Act, then
the Partnership shall pay to such Participant with respect to each Common Unit
which would have been issuable upon the Participant’s exercise of the those
Options an amount in cash equal to the excess, if any, of (i) the Fair
Market Value of a Common Unit (as of the date of such exercise) over (ii) the
exercise price per Common Unit of such Options. 
The remaining unvested and/or unexercisable Options shall be immediately
cancelled unexercised and without the payment of any consideration.

 

4

 

SECTION 8.  GENERAL PROVISIONS

 

8.1           NO RIGHTS TO OPTIONS. 
No Person shall have any claim to be granted any Option under the Plan,
and there is no obligation for uniformity of treatment of Persons under the
Plan.  The terms and conditions of
Options need not be the same with respect to each Participant.

 

8.2           WITHHOLDING. The Partnership shall (i) withhold from
any transfer made with respect to any Option cancellation or exercise under the
Plan the amount (in cash or Units) of withholding taxes due in respect thereof,
and (ii) take such other action as may be necessary in the opinion of the
Partnership to satisfy all obligations for the payment of such taxes.

 

8.3           CORRECTION OF DEFECTS, OMISSIONS AND INCONSISTENCIES.  The Committee may correct any defect, supply
any omission, or reconcile any inconsistency in the Plan or any Option in the
manner and to the extent it shall deem desirable in the establishment or
administration of the Plan.

 

8.4           NO LIMIT ON OTHER COMPENSATION ARRANGEMENTS.  Nothing contained in the Plan shall prevent
the Partnership or the Company 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.

 

8.5           NO RIGHT TO EMPLOYMENT. 
The grant of an Option shall not be construed as giving a Participant
the right to be retained in the employ of the Company or the Partnership.  Further, the Company may at any time dismiss
a Participant from employment, free from any liability or any claim under the
Plan unless otherwise expressly provided in the Plan or in any Option
Agreement.

 

8.6           GOVERNING LAW.  The
validity, construction and effect of the Plan and any rules and
regulations relating to the Plan shall be determined in accordance with
applicable Federal law, and to the extent not preempted thereby, with the laws
of the State of Missouri.

 

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

 

8.8           NO TRUST OR FUND CREATED. 
Neither the Plan nor any Option shall create or be construed to create a
trust or separate fund of any kind or a fiduciary relationship between the
Company, the Partnership 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, the Partnership or any Affiliate
pursuant to an Option, such right shall be no greater than the right of any
unsecured general creditor of the Company, the Partnership or any Affiliate.

 

5

 

8.9           NO FRACTIONAL UNITS. 
No fractional Units shall be issued or delivered pursuant to the Plan or
any Option, and the Committee shall determine whether cash, other securities,
or other property shall be paid or transferred in lieu of any fractional Units,
or whether such fractional Units or any rights thereto shall be canceled, terminated
or otherwise eliminated.

 

8.10         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.

 

8.11         NO LIMITATION.  The
existence of the Plan and the grants of Options made hereunder shall not affect
in any way the right or power of the Board, the Company in its capacity as the
general partner of the Partnership or unitholders of the Partnership to make or
authorize any adjustment, recapitalization, reorganization or other change in
the capital structure or business of the Partnership or any Affiliate, any
merger or consolidation of the Partnership or any Affiliate, any issue of debt
or equity securities ahead of or affecting Units or the rights thereof or
pertaining thereto, the dissolution or liquidation of the Partnership or any
Affiliate or any sale or transfer of all or any part of Partnership or any Affiliate’s
assets or business, or any other corporate act or proceeding.

 

8.12         RULE 16b-3.  It is
intended that the Plan and any Option granted to a Person subject to Section 16
of the Securities Exchange Act of 1934, as amended, meet all of the requirements
of Rule 16b-3.  If any provision of
the Plan or any such Option would disqualify the Plan or such Option under, or
would otherwise not comply with, Rule 16b-3, such provision or Option
shall be construed or deemed amended to conform to Rule 16b-3.

 

8.13         INVESTMENT REPRESENTATION. 
Unless the Common Units subject to Options granted under the Plan have
been registered under the Securities Act of 1933, as amended (the “1933 Act”),
(and, in the case of any Participant who may be deemed an affiliate (for securities
law purposes) of the Company or Partnership, such Common Units have been
registered under the 1933 Act for resale by such Participant), or the
Partnership has determined that an exemption from registration is available,
the Partnership may require prior to and as a condition of the issuance of any
Common Units that the person exercising an Option hereunder furnish the
Partnership with a written representation in a form prescribed by the Committee
to the effect that such person is acquiring said Common Units solely with a
view to investment for his or her own account and not with a view to the resale
or distribution of all or any part thereof, and that such person will not
dispose of any of such Common Units otherwise than in accordance with the provisions
of Rule 144 under the 1933 Act unless and until either the Common Units
are registered under the 1933 Act or the Company, on behalf of the Partnership,
is satisfied that an exemption from such registration is available.

 

8.14         COMPLIANCE WITH SECURITIES LAWS.  Anything contained herein to the contrary
notwithstanding, the Partnership shall not be obligated to sell or issue any
Common Units under the Plan unless and until the Partnership is satisfied that
such sale or issuance complies with (i) all applicable requirements of the
exchange on which the Units are traded (or the governing body of the principal
market in which such Common Units are traded, if such Common Units are not then
listed on an exchange), (ii) all applicable provisions of the 1933 Act,
and (iii) all other laws or regulations by which the Partnership is bound
or to which the Partnership is subject. 
The 

 

6

 

Company acknowledges that,
as the general partner of the Partnership, it is an affiliate of the
Partnership under securities laws and it shall comply with such laws and
obligations of the Partnership relating thereto as if they were directly
applicable to the Company.

 

SECTION 9.  TERM OF THE PLAN

 

No
Option shall be granted after the termination of the Plan.  However, unless otherwise expressly provided
in the Plan or in an applicable Option Agreement, any Option theretofore
granted may extend beyond such date, and any authority of the Committee to
amend, alter, suspend, discontinue or terminate any such Option, or to waive
any conditions or rights under any such Option, and the authority of the Board
to cancel the Option pursuant to Section 5.2, shall extend beyond such
date.

 

SECTION 10.  DEFINITIONS

 

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

 

(a)                                  “Affiliate”
shall mean (i) the Partnership, (ii) the Company, and (iii) any
entity in which the Partnership owns, directly or indirectly, more than 50% of
the beneficial interests.

 

(b)                                 “Code” shall
mean the Internal Revenue Code of 1986, as amended from time to time.

 

(c)                                  “Common Unit”
shall mean a limited partnership interest in the Partnership represented by a
common unit as set forth in the Third Amended and Restated Agreement of Limited
Partnership of Ferrellgas Partners, L.P., dated as of April 6, 2001, as
amended from time to time.

 

(d)                                 “Employee”
shall mean any employee of the Company or any Affiliate.

 

(e)                                  “Fair Market
Value” shall mean, at any specified time, with respect to a Common Unit, an amount
equal to the average closing price of a Common Unit on the New York Stock
Exchange for the 20 trading days immediately preceding such determination or,
if not so traded, as determined by the Committee.

 

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

 

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

 

(h)                                 “Option” shall
mean a right granted under the Plan to purchase Units under the Plan.

 

(i)                                     “Participant”
shall mean an Employee granted an Option under the Plan.

 

(j)                                      “Person” shall
mean any individual, corporation, partnership, association, joint-stock
company, trust, unincorporated organization or government or political
subdivision thereof.

 

(k)                                  “Rule 16b-3”
shall mean Rule 16b-3 promulgated by the Securities and Exchange
Commission under the 1934 Act.

 

7

 

(l)                                     “Subordinated
Unit” shall mean a limited partnership interest in the Partnership represented
by a subordinated unit as set forth in the Agreement of Limited Partnership of
Ferrellgas Partners, L.P., dated as of July 5, 1994.

 

8

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