Document:

EX-10.2 FORM OF AWARD AGREEMENT

 

Exhibit 10.2

FORM OF AGREEMENT UNDER NACCO INDUSTRIES, INC.

EXECUTIVE LONG-TERM INCENTIVE COMPENSATION PLAN

[date]

NACCO Industries Inc.

5875 Landerbrook Drive

Mayfield Heights, Ohio 44124-4017

Attention: Secretary

			
	Re:	 	200_ Grants of Award Shares under Executive Long-Term
Incentive Compensation Plan

     [Name]

     The undersigned is an employee of NACCO Industries, Inc. (the “Company”) to whom grants of an
award (the “Award”) consisting of [insert number] fully paid and nonassessable shares (the “Award
Shares”) of Class A Common Stock, par value $1.00 per share, of the Company’s Class A Common Stock
(“Class A Common”) were made on March __, 200_ by the Compensation Committee (the “Committee”) of
the Board of Directors of the Company pursuant to the NACCO Industries, Inc. Executive Long-Term
Incentive Compensation Plan (the “Plan”). I hereby accept the Award and acknowledge to and agree
with the Company as follows:

     1. Award. I acknowledge that the Committee has granted the Award to me subject to the terms
of the Plan and the related Executive Long-Term Incentive Compensation Plan Guidelines for the
January 1, 200_ through December 31, 200_ Award Term (the “200_-200_ Guidelines”), the terms of
the resolutions of the Committee pursuant to which the Award was made and the terms of this
Agreement, and I hereby acknowledge receipt of stock certificate numbered [number] for [number]
shares of Class A Common representing the Award Shares.

     2. Restrictions on Transfer. I represent and covenant that, other than a transfer
(a) by will or the laws of descent and distribution, (b) pursuant to a domestic relations order
meeting the definition of a qualified domestic relations order under Section 206(d)(3)(B) of the
Employee Retirement Income Security Act of 1974, as amended (“QDRO”), or (c) to a trust (a “Trust”)
for my benefit or the benefit of my spouse, my children or my grandchildren (provided that Award
Shares transferred to such a Trust shall continue to remain subject to the transfer restrictions
hereinafter set forth), the Award Shares shall be non-transferable and I shall not make (or attempt
to make) any sale, assignment, transfer, exchange, pledge, hypothecation or encumbrance of the
Award Shares.

     3. Lapse of Restrictions. I acknowledge that the transfer restrictions on the Award
Shares set forth in paragraph (2) above shall lapse for all purposes and shall be of no further
force or effect upon the earliest to occur of: (a) December 31, 20__; (b) the date of my death or
permanent disability; (c) five years after

 

 

retirement in accordance with the terms of The Combined
Defined Benefit Plan of NACCO Industries, Inc. and Its Subsidiaries (or, if I am not a member of
such plan, five years after my termination of employment after reaching age 60 with at least 15
years of service) (or earlier with the approval of the Committee); (d) an
extraordinary release of transfer restrictions pursuant to Section 3.2(d) of the 200_-200_
Guidelines; (e) the transfer of Award Shares pursuant to a QDRO, but only as to the shares so
transferred; and (f) a lapse of transfer restrictions as provided in the terms of an instrument of
termination adopted under the Plan. As notice of such transfer restrictions, I acknowledge that
there is affixed to the face or back of each stock certificate representing Award Shares the
following legend:

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER SET FORTH IN THE NACCO INDUSTRIES, INC.
EXECUTIVE LONG-TERM INCENTIVE COMPENSATION PLAN (“PLAN”). SUCH
RESTRICTIONS ON TRANSFER UNDER THE PLAN SHALL LAPSE FOR ALL PURPOSES
AND SHALL BE OF NO FURTHER FORCE OR EFFECT AFTER DECEMBER 31, 20__, OR
SUCH EARLIER TIME AS PROVIDED IN THE PLAN.

     4. Obligations. I agree that each Trust and I shall fulfill the obligations imposed with
respect to Award Shares and by the Plan and the 200_-200_ Guidelines.

     5. Rights. I understand that, subject to the transfer restrictions set forth herein, I shall
have all of the rights of a holder of Class A Common with respect to the Award Shares, including
the right to vote such shares, to receive any dividends paid thereon and to participate in any of
the matters described in clauses (a), (b) and (c) of Section 7 of the Plan. Any securities that I
receive in respect to Award Shares in connection with any of such matters shall be deemed to be
Award Shares, and shall be subject to the transfer restrictions set forth herein to the same extent
and for the same period as if such securities were the original Award Shares with respect to which
they were issued.

     6. Surrender of Certificates. I understand that: (a) in the case of a transfer under
clause (a) or (b) of paragraph 2 above, on surrender to the Company by my successor or successors
in interest to the Award Shares of the appropriate certificate or certificates reflecting the Award
Shares, or (b) on surrender to the Company of the appropriate certificate or certificates
reflecting Award Shares with respect to which the transfer restrictions have otherwise lapsed in
accordance with paragraph 3 above, the Company shall cause a new certificate or certificates to be
issued without any legend referring to such restrictions.

     7. Withholding. In order that the Company may satisfy its withholding obligations with
respect to the compensation income resulting from the grant of any Award Shares, I authorize and
direct the Company to withhold from any amounts otherwise payable to me such amounts of taxes with
respect to the income attributable to such shares and at such time or times as may be required to
be withheld, including, without limitation, taxes required to be withheld by reason of the
compensation required to be reported for Federal income and employment tax purposes by me, all as
determined in good faith in the sole judgment of the Company. If there are no such amounts
otherwise payable to me, or if such amounts are insufficient, I will reimburse or indemnify the
Company or make provision satisfactory to the Board of Directors or the Committee (or to any
officer authorized for that purpose by the Board of Directors or the Committee) to reimburse or
indemnify the Company for such amounts of taxes at such time and from time to time, as the Company
may make demand for such reimbursement or indemnity. If and to the extent that in the sole
judgment of the Board of Directors or the Committee (or any officer authorized for that purpose by
the Board of Directors or the Committee) it appears advisable to do so, in order to enforce the
Company’s rights under the

2

 

Plan and this Agreement, the Company shall not issue or cause to be
issued to me (or to my successor in interest), any new stock certificate without any legend
referring to the transfer restrictions with respect to the Award Shares as to which such
restrictions have lapsed, unless and until such amounts of taxes have been withheld from amounts
otherwise payable to me (or any of my successors in interest), or I (or such successor in interest)
reimburse or indemnify the Company for such amounts of such taxes or make other provisions for
reimbursement or indemnification to the Company of such taxes, satisfactory in the sole judgment of
the Board of Directors or the Committee (or such officer) exercised in good faith.

     8. Registration. (a) I hereby acknowledge that I have been advised, and I understand and
agree, that: (i) the issuance of such Award Shares to me has not been registered under the
Securities Act of 1933, as amended (the “Act”); (ii) any routine sale of such Award Shares made in
reliance upon Rule 144 under the Act, if then available, can only be made in limited amounts in
accordance with the terms and conditions of that Rule; (iii) the Company is not under any
obligation at any time to register any of such Award Shares under the Act; (iv) all certificates
for Award Shares shall bear a legend substantially as follows:

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. SUCH SHARES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED
UNTIL SUCH SHARES HAVE BEEN REGISTERED UNDER SUCH ACT OR UNTIL THE COMPANY
SHALL HAVE RECEIVED AN OPINION OF LEGAL COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH SHARES MAY BE LEGALLY SOLD OR OTHERWISE TRANSFERRED WITHOUT
RESTRICTIONS.

and (v) the Company may instruct any transfer agent for its shares not to permit transfer of any of
the Award Shares unless specifically authorized by the Company.

     (b) I hereby agree that none of such Award Shares shall be sold or otherwise disposed of, nor
shall any of the same be offered for sale, by me except pursuant to a currently effective
registration statement by which such shares are duly registered under the Act, or in accordance
with an opinion of counsel satisfactory to the Company, which opinion shall have been approved by
the Company and be to the effect that the contemplated transaction (which shall be described
therein) may be legally effected, and the shares so transferred may subsequently be resold, without
registration under the Act.

     9. No Right to Employment. I acknowledge that the grant of Award Shares to me does
not in any way entitle me to continued employment with the Company and does not limit or restrict
any right that the Company otherwise may have to terminate my employment.

	 	 	 
	 	 	 
	 	 	 
	 
	 	 

[name]

ACCEPTED                                                             , 20__

NACCO INDUSTRIES, INC.

	 	 	 	 
	 	 
	By  	 	 
	 	[name]	 
	 	 	 
	 

3EX-10.3 SUPPLEMENTAL ANNUAL INCENTIVE COMP. PLAN

 

Exhibit 10.3

NACCO Industries, Inc.

SUPPLEMENTAL ANNUAL INCENTIVE COMPENSATION PLAN

(Amended and Restated Effective as of January 1, 2006)

1. Purpose of the Plan

     The purpose of the NACCO Industries, Inc. Supplemental Annual Incentive Compensation Plan
(Amended and Restated as of January 1, 2006) (the “Plan”) is to further the profits and growth of
NACCO Industries, Inc. (the “Company”) by enabling the Company to attract and retain key employees
of the Company by offering annual incentive compensation to those key employees who will be in a
position to help the Company to meet its financial and business objectives.

2. Definitions

	 	(a)	 	“Award” means cash paid to a Participant under this Plan for any year in an
amount determined in a manner not inconsistent with the terms hereof.
	 
	 	(b)	 	“Committee” means the Compensation Committee of the Company’s Board of
Directors or any other committee appointed by the Company’s Board of Directors to
administer this Plan in accordance with Section 3, so long as any such committee
consists of not less than two directors of the Company and so long as each member of
the Committee is not an employee of the Company or any of its subsidiaries.
	 
	 	(c)	 	“Participant” means any salaried employee of the Company who in the judgment of
the Committee occupies a key position in which his efforts may significantly contribute
to the profits or growth of the Company. Employees of the Company’s subsidiaries shall
not be eligible to participate in this Plan.
	 
	 	(d)	 	“Section 162(m)” means Section 162(m) of the Internal Revenue Code of 1986, as
amended, or any successor provision.
	 
	 	(e)	 	“Target Award” means a dollar amount equal to the amount of cash to be paid to
a Participant under the Plan assuming that all performance targets are met. The Target
Award, together with the target amounts for the Participant under the Company’s other
incentive compensation plans, shall be in an amount which is competitive with similar
target awards at other similarly situated companies.

3. Administration

     This Plan shall be administered by the Committee. The Committee shall have complete authority
to interpret all provisions of this Plan consistent with law, to prescribe the form of any

1

 

instrument evidencing any Target Award or Award under this Plan, to adopt, amend and rescind
general and special rules and regulations for its administration, and to make all other
determinations necessary or advisable for the administration of this Plan; provided, however, that
no such action may be taken by the Committee which would cause any amounts to be paid to a
Participant who is, or is determined by the Committee to be likely to become, a “covered employee”
to be includable as “applicable employee remuneration” of such Participant, as such terms are
defined in Section 162(m). A majority of the Committee shall constitute a quorum, and the action
of members of the Committee present at any meeting at which a quorum is present, or acts
unanimously approved in writing, shall be the act of the Committee. All acts and decisions of the
Committee with respect to any questions arising in connection with the administration and
interpretation of this Plan, including the severability of any or all of the provisions hereof,
shall be conclusive, final and binding upon the Company and all present and former Participants,
all other employees of the Company, and their respective descendants, successors and assigns. No
member of the Committee shall be liable for any such act or decision made in good faith.

4. Eligibility

     Each Participant, including directors of the Company who are also salaried employees of the
Company, shall be eligible to participate in this Plan and receive Awards in accordance with
Section 5.

5. Awards

     The Committee may, from time to time and upon such conditions as it may determine, authorize
the payment of Awards to Participants, which shall be not inconsistent with, and shall be subject
to all of the requirements of, the following provisions:

	 	(a)	 	Not later than the ninetieth day of each calendar year, the Committee shall
approve (i) a Target Award to be granted to each Participant and (ii) one or more
performance targets and formulas for determining the amount of each Award. Performance
targets shall be based upon the return on total capital employed, return on equity,
return on tangible assets employed, economic value income, net income, market share,
sales development or support costs of the Company and/or its subsidiaries; provided,
however, that performance targets which are used in the Plan will not be used in the
Company’s Annual Incentive Compensation Plan in the same year.
	 
	 	(b)	 	Not later than March 15th of the following calendar year, the
Committee shall approve (i) a preliminary calculation of the amount of each Award based
upon the application of the formula and actual performance to the Target Awards
previously determined in accordance with Section 5(a); and (ii) a final calculation of
the amount of each Award to be paid to each Participant for the prior year.
Notwithstanding the foregoing, (1) the Committee shall have the power to decrease the
amount of any Award below the amount determined in accordance with Section 5(b)(i); (2)
the Committee shall have the power to increase the amount of any Award above the amount
determined in accordance with Section

2

 

	 	 	 	5(b)(i); provided, however, that no such increase or change may be made which would
cause any amount paid to a Participant who is, or is determined by the Committee to
be likely to become, a “covered employee” to be includable as “applicable employee
remuneration” of such Participant, as such terms are defined in Section 162(m) and
(3) no Award, including any Award equal to the Target Award, shall be payable under
the Plan to any Participant except as determined by the Committee.
	 
	 	(c)	 	Promptly following the determination of Awards for the Participants pursuant to
Section 5(b)(ii) and, in any event, within two and one-half months after the end of the
calendar year to which the Award relates, the Company shall pay the amount of such
Awards to the Participants in cash, subject to all withholdings and deductions pursuant
to Section 6.
	 
	 	(d)	 	No Award may be paid for any year to a Participant in excess of $800,000.

6. Withholding Taxes

     Any Award paid to a Participant under this Plan shall be subject to all applicable federal,
state and local income tax, social security and other withholdings and deductions.

7. Amendment and Termination

     The Committee may alter or amend this Plan from time to time or terminate it in its entirety;
provided, however, that no such action shall, without the consent of a Participant, affect the
rights in an outstanding Award of such Participant; and further provided, however, that no
amendment may be made which would cause any amount paid to a Participant who is, or is determined
by the Committee to be likely to become, a “covered employee” to be includable as “applicable
employee remuneration” of such Participant, as such terms are defined in Section 162(m).

8. General Provisions

	 	(a)	 	No Right of Employment. Neither the adoption or operation of this Plan, nor
any document describing or referring to this Plan, or any part thereof, shall confer
upon any employee any right to continue in the employ of the Company, or shall in any
way affect the right and power of the Company to terminate the employment of any
employee at any time with or without assigning a reason therefor to the same extent as
the Company might have done if this Plan had not been adopted.
	 
	 	(b)	 	Governing Law. The provisions of this Plan shall be governed by and construed
in accordance with the laws of the State of Delaware.
	 
	 	(c)	 	Miscellaneous. Headings are given to the sections of this Plan solely as a
convenience to facilitate reference. Such headings, numbering and paragraphing shall
not in any case be deemed in any way material or relevant to the construction of this
Plan or any provisions thereof. The use of the masculine

3

 

	 	 	 	gender shall also include within its meaning the feminine. The use of the singular
shall also include within its meaning the plural, and vice versa.
	 
	 	(d)	 	Limitation on Rights of Employees; No Trust. No trust has been created by the
Company for the payment of Awards under this Plan; nor have the employees been granted
any lien on any assets of the Company to secure payment of such benefits. This Plan
represents only an unfunded, unsecured promise to pay by the Company and a participant
hereunder is a mere unsecured creditor of the Company.

9. Approval by Stockholders

     The Plan shall be submitted for approval by the stockholders of the Company. If such approval
has not been obtained by June 1, 2006, this Plan shall be nullified and all grants of Target Awards
shall be rescinded.

10. Effective Date

     Subject to its approval by the stockholders of the Company, this amended and restated Plan
shall become effective as of January 1, 2006.

4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00103-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00103-of-00352.parquet"}]]