Document:

Exhibit 10.1

 

FLEETWOOD
ENTERPRISES, INC.

AMENDED
AND RESTATED

1992
STOCK-BASED INCENTIVE COMPENSATION PLAN

(As Amended Through March 1, 2004)

 

I.                                         GENERAL
PROVISIONS

 

1.1  Purposes of the Plan

 

Fleetwood Enterprises, Inc.
(“Fleetwood”) has adopted this 1992 Stock-Based Incentive Compensation Plan
(the “Plan”) to advance the interests of Fleetwood and its stockholders by
affording to key management and other Employees of Fleetwood and its
subsidiaries an opportunity to acquire or increase a proprietary interest in
Fleetwood or to otherwise benefit from the success of the Company through the
grant to such Employees of Incentive Awards under the terms and conditions set
forth herein. By thus encouraging such Employees to become owners of
Fleetwood’s shares and by granting such Employees other incentive compensation
that is measured by the increased market value of Fleetwood’s shares or another
appropriate measure of the success and profitability of the Company, the
Company seeks to attract, retain and motivate those highly competent
individuals upon whose judgment, initiative, leadership and continued efforts
the success of the Company in large measure depends.

 

1.2  Definitions.

 

As used herein the following terms shall have
the meanings set forth below:

 

(a)                                  “Board” means the
Board of Directors of Fleetwood.

 

(b)                                 “Cause” shall include
but not be limited to: (i) Participant’s refusal to comply with a lawful,
written instruction of the Board or Participant’s immediate supervisor, which
refusal is not remedied by Participant within a reasonable period of time after
his receipt of written notice from the Company identifying the refusal;
(ii) Participant’s act or acts of personal dishonesty which were intended
to result in Participant’s personal enrichment at the expense of the Company or
any of its affiliated companies; or (iii) Participant’s conviction of any
misdemeanor involving an act of moral turpitude or any felony; or
(iv) Participant’s failure to perform his duties in a satisfactory manner.
Participant must be provided written notice of the unsatisfactory performance
and provided at least ninety (90) days to improve his performance.

 

(c)                                  “Change in Control”
means the following and shall be deemed to occur if any of the following events
occur:

 

(i)                                     The
acquisition (other than from Fleetwood) by any person, entity or “group,”
within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act
(excluding, for this purpose, Fleetwood or its subsidiaries, or any executive
benefit plan of Fleetwood or its subsidiaries which acquires beneficial
ownership of voting securities of Fleetwood), of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of
twenty-five percent (25%) or more of either the then-outstanding shares of common
stock or the combined voting power of Fleetwood’s then-outstanding voting
securities entitled to vote generally in the election of directors;

 

(ii)                                  Individuals
who, as of the date hereof, constitute the Board (the “Incumbent Board”), cease
for any reason to constitute at least a majority of the Board, provided that
any person becoming a director subsequent to the date hereof whose election, or
nomination for election by Fleetwood’s stockholders, is approved by a vote of
at least a majority of the directors then comprising the Incumbent Board (other
than an election or nomination of an individual whose initial assumption of
office is in connection with an actual or threatened election contest relating
to the election of the directors of Fleetwood, as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the Exchange Act)
shall, for the purposes of this Plan, be considered as though such person were
a member of the Incumbent Board;

 

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(iii)                               The
stockholders of Fleetwood approve a merger or consolidated with any other
corporation, other than

 

(A)                              a
merger or consolidation which would result in the voting securities of
Fleetwood outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of
another entity) more than 50% of the combined voting power of the voting
securities of Fleetwood or such other entity outstanding immediately after such
merger or consolidation, and

 

(B)                                a
merger or consolidation effected to implement a recapitalization of the Company
(or similar transaction) in which no person acquires 25% or more of the
combined voting power of Fleetwood’s then outstanding voting securities; or

 

(iv)                              The
stockholders of Fleetwood approve a plan of complete liquidation of the Company
or an agreement for the sale or other disposition by the Company of all or
substantially all of the Company’s assets.

 

Notwithstanding the preceding provisions of this Section 1.2(d), a
Change in Control shall not be deemed to have occurred (1) if the “person”
described in the preceding provisions of this Paragraph is an underwriter or
underwriting syndicate that has acquired the ownership of 50% or more of the
combined voting power of Fleetwood’s then outstanding voting securities solely
in connection with a public offering of Fleetwood’s securities; (2) if the
“person” described in the preceding provisions of this Paragraph is an employee
stock ownership plan or other employee benefit plan maintained by the Company
that is qualified under the provisions of the Employee Retirement Income
Security Act of 1974, as amended; or (3)  if the person described in
clause (i) of the preceding provisions of this Paragraph would not
otherwise be a beneficial owner of 25% or more of the combined voting power of
Fleetwood’s then outstanding voting securities but for a reduction in the
number of outstanding voting securities resulting from a stock repurchase
program or other similar plan of the Company or from a self tender offer of the
Company, which plan or tender offer commenced on or after the date hereof,
provided, however, that the term “person” shall include such person from and
after the first date upon which (A) such person, since the date of the commencement
of such plan or tender offer, shall have acquired beneficial ownership of, in
the aggregate, a number of voting securities of the Company equal to 1% or more
of the voting securities of the Company then outstanding and (B) such
person, together with all affiliates and associates of such person, shall
beneficially own 25% or more the voting securities of the Company then
outstanding.

 

(d)                                 “Code” means the
Internal Revenue Code of 1986, as amended. Where the context so requires, a
reference to a particular Code section shall also refer to any successor
provision of the Code to such section.

 

(e)                                  “Committee” means the
committee appointed by the Board to administer the Plan.

 

(f)                                    “Common Stock”
means the common stock of Fleetwood, par value $1.00 per share.

 

(g)                                 “Company” means
Fleetwood and any present or future parent or subsidiary corporations (as
defined in Section 424 of the Code of 1986, as amended) with respect to
Fleetwood, any other entity designated by the Board, or any successors to such
corporations or entities.

 

(h)                                 “Employee” means any
regular employee of the Company.

 

(i)                                     “Exchange Act”
means the Securities Exchange Act of 1934, as amended. Where the context so
requires, a reference to a particular section of the Exchange Act shall
also refer to any successor provision to such section.

 

(j)                                     “Fair Market
Value” means the fair market value of a share of Common Stock as determined by
the Committee on the basis of such factors as it may deem appropriate.

 

(k)                                  “Fleetwood” means
Fleetwood Enterprises, Inc., a Delaware corporation, or any successor
thereto.

 

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(l)                                     “Incentive Award”
means any Stock Option, Stock Appreciation Right, Stock Payment, Restricted
Stock, Performance Award or other award granted or sold under the Plan.

 

(m)                               “Incentive Stock Option”
means an incentive stock option, as defined under Section 422 of the Code
and the regulations thereunder.

 

(n)                                 “LTPP” means the
Company’s 2002 Long-Term Performance Plan.

 

(o)                                 “Nonqualified Stock Option”
means a stock option other than an Incentive Stock Option. An Option that
otherwise meets the requirements under Code Section 422 for qualification
as an incentive stock option shall nevertheless be treated as a Nonqualified
Stock Option if the Committee so specifies in the Incentive Award pursuant to
which such Option is granted.

 

(p)                                 “Option or “Stock
Option” means a right to purchase Common Stock and refers to both Incentive
Stock Options and Nonqualified Stock Options, subject to an Incentive Award
under this Plan and the provisions of Article III hereof.

 

(q)                                 “Participant” means
any Employee selected by the Committee to receive an Incentive Award pursuant
to this Plan.

 

(r)                                    “Payment Event”
means the event or events giving rise to the right to payment of a Performance
Award.

 

(s)                                  “Performance Award”
means an award, payable in cash, Common Stock or a combination thereof, which
is the subject of an Incentive Award under this Plan and the provisions of
Article IV hereof.

 

(t)                                    “Performance-Based
Compensation” means performance-based compensation as described in
Section 162(m) of the Code and the regulations thereunder. If the amount
of compensation an Employee will receive under any Incentive Award is not based
solely on an increase in the value of Common Stock after the date of grant or
award, the Committee, in order to qualify an Incentive Award as
performance-based compensation under Section 162(m) of the Code and the
regulations thereunder, can condition the grant, award, vesting, or exercisability
of such an award on the attainment of a preestablished, objective performance
goal. For this purpose, a preestablished, objective performance goal may
include one or more of the following performance criteria: (i) cash flow,
(ii) earnings per share (including earnings before interest, taxes, and
amortization), (iii) return on equity, (iv) total stockholder return,
(v) return on capital, (vi) return on assets or net assets,
(vii) income or net income, (viii) operating margin, (ix) return
on operating revenue, and (x) any other similar performance criteria
contemplated by the regulations under Section 162(m).

 

(u)                                 “Plan” means the
Fleetwood Enterprises, Inc. 1992 Stock-Based Incentive Compensation Plan
as set forth herein, as amended from time to time.

 

(v)                                 “Purchase Price” means
the purchase price (if any) to be paid by a Participant for Restricted Stock as
determined by the Committee.

 

(w)                               “Restricted Stock” means
Common Stock which is the subject of an Incentive Award under this Plan and the
provisions of Article VI hereof.

 

(x)                                   “Securities Act”
means the Securities Act of 1933, as amended.

 

(y)                                 “Stock Appreciation
Right” or “Right” means a right granted pursuant to Article V of the Plan
to receive a number of shares of Common Stock or, in the discretion of the
Committee, an amount of cash or a combination of shares and cash, based on the
increase in the Fair Market Value of the shares subject to the right during
such period as is specified by the Committee.

 

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(z)                                   “Stock Payment”
means a payment in shares of the Company’s Common Stock to replace all or any
portion of the compensation (other than base salary) that would otherwise
become payable to any Employee of the Company, as provided in ArticleVII.

 

 

1.3  Shares of Common Stock Subject to the Plan

 

(a)                                  Subject to the
provisions of Section 1.3(c) and Section 8.1 of the Plan, the
aggregate number of shares of Common Stock that may be issued (or allocated in
the case of Stock Appreciation Rights which have been exercised) pursuant to
Incentive Awards under this Plan shall not exceed 9,900,000 shares, which
amount gives effect to a two-for-one split of the Common Stock effected in the
fourth quarter of the Company’s fiscal 1993, the addition of 2,000,000 post-split
shares effective April 17, 1996, the addition of 2,000,000 post-split
shares effective June 8, 1999 and the addition of 3,000,000 post-split
Shares effective September 10, 2002. Of the aggregate number of shares of
Common Stock that may be issued under this Plan, no more than 600,000 of such
shares may be issued in the form of Restricted Stock.

 

(b)                                 The Common Stock to be
issued under this Plan will be made available, at the discretion of the Board
or the Committee, either from authorized but unissued shares of Common Stock or
from previously issued shares of Common Stock reacquired by the Company,
including shares purchased on the open market.

 

(c)                                  Shares of Common
Stock subject to unexercised portions of any Option or Right granted under this
Plan that expires, terminates or is canceled (other than an Option or Right
which expires because it was in tandem with an Option or Right which was
exercised), will again become available for the grant of further Incentive
Awards under this Plan.

 

(d)                                 Notwithstanding any
other provision of this Plan, no Employee shall be granted Incentive Awards
with respect to more than 400,000 shares of Common Stock in any one calendar
year. The limitation set forth in this Section 1.3(d) shall be subject to
adjustment as provided in Section 8.1, but only to the extent such
adjustment would not affect the status of compensation attributable to
Incentive Awards hereunder as Performance-Based Compensation.

 

1.4  Administration of the Plan

 

(a)                                  The Plan will be
administered by the Committee, which will consist of two or more members of the
Board appointed by the Board who, during the one-year period prior to service
on the Committee and while serving on the Committee, are not granted or awarded
equity securities of Fleetwood pursuant to the Plan or any other plan of the
Company or any of its affiliates, except as permitted by Rule 16b-3
promulgated under the Exchange Act (or any other comparable provisions at the
time or times in question), and who otherwise meet the definition of “Non-Employee
Director” in Rule 16b-3(b)(3) thereof. In addition, if Incentive Awards are
intended to constitute Performance-Based Compensation, then each of the
Committee’s members shall also be an “outside director,” as such term is
defined in the regulations under Section 162(m) of the Code.
Notwithstanding anything contained herein, no person shall be disqualified from
being a member of the Committee merely because such person is entitled to
receive grants or awards pursuant to the Fleetwood Enterprises, Inc. 1992
Nonemployee Director Stock Plan.

 

(b)                                 The Committee has and
may exercise such powers and authority of the Board as may be necessary or
appropriate for the Committee to carry out its functions as described in the
Plan. The Committee has authority in its discretion to select the eligible
Employees to whom, and the time or times at which, Incentive Awards shall be
granted or sold, the nature of each Incentive Award, the number of shares of
Common Stock or the number of rights that make up each Incentive Award, the
period for the exercise of each Incentive Award, the performance criteria
(which need not be identical) utilized to measure the value of Performance
Awards and such other terms and conditions applicable to each individual
Incentive Award as the Committee shall determine. The Committee may grant at
any time new Incentive Awards to a Participant who has previously received
Incentive Awards or other grants (including other stock options) whether such
prior Incentive Awards or such other grants are still outstanding, have
previously been exercised in whole or in part, or are canceled in connection
with the issuance of new Incentive Awards; provided, however, that the
Committee shall not have the authority to amend outstanding Incentive Awards or
to cancel outstanding Incentive Awards and grant new Incentive Awards

 

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in substitution thereof if the purpose of such action is to reprice
outstanding Incentive Awards. The Committee may grant Incentive Awards singly
or in combination or in tandem with other Incentive Awards as it determines in
its discretion. The purchase price or initial value and any and all other terms
and conditions of the Incentive Awards may be established by the Committee
without regard to existing Incentive Awards or other grants. Further, the
Committee may, with the consent of a Participant, amend in a manner consistent
with the Plan the terms of any existing Incentive Award previously granted to
such Participant or acquire from a Participant for a payment of cash, Common
Stock or other consideration any existing Incentive Award.

 

(c)                                  Subject to the
express provisions of the Plan, the Committee has the authority to interpret
the Plan, to determine the terms and conditions of Incentive Awards and to make
all other determinations necessary or advisable for the administration of the
Plan. The Committee has authority to prescribe, amend and rescind rules and
regulations relating to the Plan. All interpretations, determinations and
actions by the Committee shall be final, conclusive and binding upon all
parties. Any action of the Committee with respect to the administration of the
Plan shall be taken pursuant to a majority vote or by the unanimous written
consent of its members.

 

(d)                                 No member of the Board
or the Committee will be liable for any action or determination made in good
faith by the Board or the Committee with respect to the Plan or any transaction
arising under the Plan.

 

1.5  Participation

 

(a)                                  All Employees, as
determined by the Committee, are eligible to receive Incentive Awards under the
Plan. In no event may any member of the Board who is not an Employee be
eligible to participate in, or be granted an Incentive Award under, the Plan.

 

(b)                                 At the time of the
grant of each Incentive Award pursuant to this Plan, the Committee shall
deliver, or cause to be delivered, to the Participant to whom the Incentive
Award is granted a written statement evidencing the Incentive Award and setting
forth such terms and conditions applicable to the Incentive Award as the
Committee may in its discretion determine consistent with the Plan.

 

II.                                     DIVIDEND
EQUIVALENTS

 

(a)                                  In the Committee’s
discretion, a Participant may, as set forth in subparagraph (b) below, be
entitled to receive, at no additional cost, an amount for each share of Common
Stock upon which an Incentive Award is based, a “Dividend Equivalent” equal to
the cash or other consideration paid as a dividend or distribution (other than
a dividend or distribution payable in Common Stock) by the Company with respect
to its outstanding shares of Common Stock, provided that with respect to
Options and Rights granted in tandem, the Dividend Equivalent will be payable
with respect to either the Right or the Option, but not both. If awarded by the
Committee, Dividend Equivalents shall be paid, with respect to record dates
during the period on or after the date an Incentive Award is granted to and
including the date such Incentive Award is exercised or terminated, or such
other period as is determined by the Committee and specified in the instrument
that evidences the grant of the Incentive Award. Such Dividend Equivalents
shall be converted to additional shares of Common Stock or cash by such formula
as may be determined by the Committee.

 

(b)                                 The Committee, in its
discretion, shall determine from time to time whether any Participant shall be
entitled to Dividend Equivalents with respect to any other Incentive Award. The
Committee shall not be obligated to award Dividend Equivalents, and may elect
to grant Dividend Equivalents to some Participants and not to other
Participants.

 

(c)                                  Dividend Equivalents
shall be computed as of each record date for Common Stock dividends or
distributions in such manner as may be determined by the Committee and shall be
payable to Participants who have been granted Dividend Equivalents at such time
or times as the Committee in its discretion may determine. Dividend Equivalents
payable to holders of Incentive Awards may be deferred and paid at a later date
as and to the extent provided in the

 

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Fleetwood Enterprises, Inc. Deferred Compensation Plan, as amended or
restated from time to time.

 

III.                                 OPTIONS

 

3.1  Grant of Options; Option Price

 

(a)                                  The Committee may
grant Options under the Plan from time to time to Employees.

 

(b)                                 The purchase price of
Common Stock under each Option (the “Option Exercise Price”) will be determined
by the Committee at the date such Option is granted. The Option Exercise Price
may be equal to or greater than, but not less than, Fair Market Value on the
date of grant of the Common Stock subject to the Option; provided, further,
that (i) in no event shall the Option Exercise Price be less than the Fair
Market Value of the Company Stock subject to the Option on the date of grant
nor less than the par value of the shares of Common Stock subject to the
Option; and (ii) that in the case of an Incentive Stock Option the Option
Exercise Price shall be not less than the Fair Market Value on the date of grant
of the Common Stock subject to such Option or such other amount as is necessary
to enable such Option to be treated as an “incentive stock option” within the
meaning of Code Section 422.

 

3.2  Option Period

 

Options may be exercised as determined by the
Committee, but, in the case of an Incentive Stock Option, in no event after ten
years from the date of grant of such Option or such other period as is
necessary to enable such Option to be treated as an “incentive stock option”
within the meaning of Code Section 422. Options granted to persons who are
subject to the provisions of Section 16 of the Exchange Act shall not be
exercisable prior to the expiration of six (6) months from the date of the
grant of such Option.

 

3.3  Exercise of Options

 

At the time of the exercise of an Option, the
purchase price shall be paid in full in cash or other equivalent consideration
acceptable to the Committee and consistent with the Plan’s purpose and
applicable law, including without limitation, Common Stock or Restricted Stock
or other contingent awards denominated in either stock or cash. Any shares of
Company Stock assigned and delivered to the Company in payment or partial
payment of the purchase price will be valued at their Fair Market Value on the
exercise date. No fractional shares will be issued pursuant to the exercise of
an Option nor will any cash payment be made in lieu of fractional shares. In
the case of an Incentive Stock Option, only the Participant to whom such Option
is granted may exercise such Option during the lifetime of such Participant,
provided, however, in the event, that such Participant becomes incompetent to
exercise such Option, then such Participant’s legal representative may exercise
such Option on his behalf.

 

3.4  Limitation on Exercise of Incentive Stock
Options

 

The aggregate Fair Market Value (determined
at the time the Option is granted) with respect to which Incentive Stock
Options are exercisable for the first time by any Employee during any calendar
year (under all stock option plans of the Company) shall not exceed $100,000 or
such other limit as is prescribed by the Code. Any Options granted as Incentive
Stock Options pursuant to the Plan in excess of such limitation shall be
treated as Nonqualified Stock Options.

 

3.5  Termination of Employment

 

(a)                                  Except as otherwise
provided in a written agreement between the Company and the Participant, in the
event of the termination of a Participant’s employment with the Company for
Cause, all of the Participant’s unexercised Options and/or Rights shall expire
as of the date of such termination.

 

(b)                                 Except as otherwise
provided in a written agreement between the Company and the Participant, in the
event of a Participant’s termination of employment for:

 

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(i)                                     Any
reason other than for Cause, death, disability, or normal retirement (as
defined in the Company’s retirement plan which covers the Participant), the
Participant’s Options and/or Rights shall expire and become unexercisable as of
the earlier of (A) the date such Options and/or Rights expire in
accordance with their terms or (B) three calendar months after the date of
termination.

 

(ii)                                  Death
or disability, subject to the provisions of Section 3.5(c) below, the
Participant (or such Participant’s legal representative) shall have twelve
(12) months after the date of termination within which to exercise Options
and/or Rights that have become exercisable on or before such date and that have
not expired on or before such date, regardless of the date upon which such
Options or Rights would otherwise expire in accordance with their terms.

 

(iii)                               Normal
retirement, subject to the provisions of Section 3.5(c) below, the
Participant’s Options and/or Rights shall expire and become unexercisable as of
the earlier of (A) the date such Options and/or Rights expire in
accordance with their terms or (B) three (3) years after the date of
termination.

 

(c)                                  Notwithstanding
anything to the contrary in Sections 3.5(a) or 3.5(b), above, the Committee may
in its discretion designate such shorter or longer periods to exercise Options
and/or Rights following a Participant’s termination of employment; provided,
however, that any shorter periods determined by the Committee shall be
effective only if provided for in the instrument that evidences the grant to
the Participant of such Options and/or Rights or if such shorter period is
agreed to in writing by the Participant. In the case of an Incentive Stock
Option, notwithstanding anything to the contrary herein, in no event shall such
Option be exercisable after the expiration of ten years from the date such
Option is granted (or such other period as is provided in Code
Section 422), nor shall such Option be the subject of any term or
provision which would disqualify such Option from being an incentive stock
option under Code Section 422. Notwithstanding anything to the contrary
herein, Options and/or Rights shall be exercisable by a Participant (or his
successor in interest) following such Participant’s termination of employment
only to the extent that installments thereof had become exercisable on or prior
to the date of such termination; provided, however, that the Committee, in its
discretion, may elect to accelerate the vesting of all or any portion of any
Options and/or Rights that had not become exercisable on or prior to the date
of such termination.

 

IV.                                PERFORMANCE
AWARDS

 

4.1  Grant of Performance Awards

 

The Committee may authorize the payment of
Performance Awards under the Plan. The Committee shall determine the performance
criteria (which need not be identical) to be utilized to calculate the value of
the Performance Awards, the term and vesting (which shall not be less than one
year) of such Performance Awards, the Payment Event, and the form and time of
payment of Performance Awards. The specific terms and conditions of each
Performance Award shall be set forth in a written statement evidencing the
grant of such Performance Award.

 

4.2  Payment of Award; Limitation

 

Upon the occurrence of a Payment Event,
payment of a Performance Award will be made to the Participant in cash or in
shares of Common Stock valued at Fair Market Value on the date of the Payment
Event or a combination of Common Stock and cash, as the Committee in its
discretion may determine. The Committee may impose a limitation on the amount
payable upon the occurrence of a Payment Event, which limitation shall be set
forth in the written statement evidencing the grant of the Performance Award.
Notwithstanding any other provision of this Plan, as to any Performance Awards
not subject to the annual share limitation of Section 1.3(d), no Employee
shall be granted Performance Awards of more than $500,000 in any one calendar
year.

 

4.3  Expiration of Performance Award

 

If any Participant’s employment with the
Company is terminated for any reason, all of the Participant’s rights under the
Performance Award shall expire and terminate unless otherwise determined by the
Committee.

 

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V.                                    STOCK
APPRECIATION RIGHTS

 

5.1  Granting of Stock Appreciation Rights

 

The Committee may grant to Employees Stock
Appreciation Rights, related or unrelated to Options, at any time.

 

(a)                                  A Stock Appreciation
Right granted in connection with an Option granted under this Plan will entitle
the holder of the related Option, upon exercise of the Stock Appreciation
Right, to surrender such Option, or any portion thereof to the extent
unexercised, with respect to the number of shares as to which such Stock
Appreciation Right is exercised, and to receive payment of an amount computed
pursuant to Section 5.1(c). Such Option will, to the extent surrendered,
then cease to be exercisable.

 

(b)                                 Subject to
Section 5.1(g), a Stock Appreciation Right granted in connection with an
Option hereunder will be exercisable at such time or times, and only to the
extent that, the related Option is exercisable, and will not be transferable
except to the extent that such related Option may be transferable. A Stock
Appreciation Right shall be canceled to the extent a related Option is
exercised.

 

(c)                                  Upon the exercise of
a Stock Appreciation Right related to an Option, the Holder will be entitled to
receive payment of an amount determined by multiplying: (i) the difference
obtained by subtracting the Option Exercise Price of a share of Common Stock
specified in the related Option from the Fair Market Value of a share of Common
Stock on the date of exercise of such Stock Appreciation Right (or as of such
other date or as of the occurrence of such event as may have been specified in
the instrument evidencing the grant of the Stock Appreciation Right), by
(ii) the number of shares as to which such Stock Appreciation Right is
exercised.

 

(d)                                 The Committee may
grant Stock Appreciation Rights unrelated to Options to Employees.
Section 5.1(c) shall be used to determine the amount payable at exercise
under such Stock Appreciation Right, except that in lieu of the Option Exercise
Price specified in the related Option the initial base amount specified in the
Incentive Award shall be used.

 

(e)                                  Notwithstanding the
foregoing, the Committee, in its discretion, may place a dollar limitation on
the maximum amount that will be payable upon the exercise of a Stock
Appreciation Right under the Plan.

 

(f)                                    Payment of the
amount determined under the foregoing provisions of this Section 5.1 may
be made solely in whole shares of Common Stock valued at their Fair Market
Value on the date of exercise of the Stock Appreciation Right or,
alternatively, at the sole discretion of the Committee, in cash or in a
combination of cash and shares of Common Stock as the Committee deems
advisable. The Committee is hereby vested with full discretion to determine the
form in which payment of a Stock Appreciation Right will be made and to consent
to or disapprove the election of a Participant to receive cash in full or
partial settlement of a Stock Appreciation Right. If the Committee decides to
make full payment in shares of Common Stock, and the amount payable results in
a fractional share, payment for the fractional share will be made in cash.

 

(g)                                 The Committee may, at
the time a Stock Appreciation Right is granted, impose such conditions on the
exercise of the Stock Appreciation Right as may be required to satisfy the
requirements of Rule 16b-3 under the Exchange Act (or any other comparable
provisions in effect at the time or times in question).

 

(h)                                 No Stock Appreciation
Rights granted hereunder shall vest earlier than one year from the date of
grant.

 

5.2  Termination of Employment

 

Section 3.5 will govern the treatment of
Stock Appreciation Rights upon the termination of a Participant’s employment
with the Company.

 

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VI.                                RESTRICTED
STOCK

 

6.1  Award of Restricted Stock

 

Subject to Section 1.3(a), which establishes
a limitation on the number of shares of Restricted Stock that may be issued
under this Plan, the Committee may grant awards of Restricted Stock to
Employees. The Committee shall determine the Purchase Price (if any), the terms
of payment of the Purchase Price, the restrictions upon the Restricted Stock,
and when such restrictions shall lapse, provided that the restriction period
shall be at least one year for performance- based grants (including grants made
in settlement of awards earned under the LTPP) and three years for
non-performance based grants. The terms and conditions of the Restricted Stock
shall be set forth in the statement evidencing the grant of such award of
Restricted Stock.

 

6.2  Requirements of Restricted Stock

 

All shares of Restricted Stock granted or
sold pursuant to the Plan will be subject to the following conditions:

 

(a)                                  The
shares may not be sold, assigned, transferred, pledged, hypothecated or
otherwise disposed of, alienated or encumbered until the restrictions are
removed or expire;

 

(b)                                 The
Committee may require that the certificates representing Restricted Stock
granted or sold to a Participant pursuant to the Plan remain in the physical
custody of an escrow holder or the Company until all restrictions are removed
or expire;

 

(c)                                  Each
certificate representing Restricted Stock granted or sold to a Participant
pursuant to the Plan will bear such legend or legends making reference to the
restrictions imposed upon such Restricted Stock as the Committee in its
discretion deems necessary or appropriate to enforce such restrictions; and

 

(d)                                 The
Committee may impose such other conditions on Restricted Stock as the Committee
may deem advisable including, without limitation, restrictions under the
Securities Act, under the Exchange Act, under the requirements of any stock
exchange upon which such Restricted Stock or shares of the same class are then
listed and under any blue sky or other securities laws applicable to such
shares.

 

6.3  Lapse of Restrictions

 

The restrictions imposed upon Restricted
Stock pursuant to Section 6.2 above will lapse in accordance with such
schedule or other conditions as are determined by the Committee and set
forth in the statement evidencing the grant or sale of the Restricted Stock.
Notwithstanding the foregoing, the Committee shall not accelerate the lapse of
the restriction period of any Restricted Stock granted hereunder or pursuant to
the LTPP except in the event of death, disability, termination without cause,
retirement, change-in-control, or otherwise in circumstances specifically
enumerated elsewhere in this Plan or in the LTPP.

 

6.4  Rights of Participant

 

Subject to the provisions of Section 6.2
or restrictions imposed pursuant to Section 6.2, the Participant will have
all rights of a stockholder with respect to the Restricted Stock granted or
sold to such Participant under the Plan, including the right to vote the shares
and receive all dividends and other distributions paid or made with respect
thereto.

 

6.5  Termination of Employment

 

Unless the Committee in its discretion
determines otherwise, subject to Section 6.3, upon a Participant’s
termination of employment for any reason, all of the Participant’s Restricted
Stock remaining subject to restrictions imposed pursuant to

 

9

 

this Plan on the date of such termination of employment shall be
repurchased by the Company at the Purchase Price (if any).

 

VII.                            STOCK
PAYMENTS

 

The Committee may approve Stock Payments of
the Company’s Common Stock to any Employee of the Company for all or any
portion of the Employee’s compensation (other than base salary). For purposes
of making Stock Payments, the Common Stock shall be valued by the Committee,
provided that such Stock Payments shall not exceed 990,000 shares of Common
Stock in the aggregate.

 

VIII. 
OTHER PROVISIONS

 

8.1  Adjustment Provisions

 

(a)                                  Subject to
Section 8.1(b) below, (i) if the outstanding shares of Common Stock
of Fleetwood are increased, decreased or exchanged for a different number or kind
of shares or other securities of Fleetwood, or if additional shares or new or
different shares or other securities of Fleetwood are distributed in respect of
such shares of Common Stock (or any stock or securities received with respect
to such Common Stock), through reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split, spin-off or
other distribution with respect to such shares of Common Stock (or any stock or
securities received with respect to such Common Stock), or (ii) if the
value of the outstanding shares of Common Stock of Fleetwood is reduced by
reason of an extraordinary cash dividend, an appropriate and proportionate
adjustment may be made in (x) the maximum number and kind of shares provided
in Section 1.3, (y) the number and kind of shares or other securities
subject to then outstanding Incentive Awards, and (z) the price for each
share or other unit of any other securities subject to then outstanding
Incentive Awards.

 

(b)                                 In addition to the
adjustments permitted by Section 8.1(a) above, except as otherwise
expressly provided in the statement evidencing the grant of an Incentive Award,
upon the occurrence of a Change in Control of Fleetwood any outstanding
Incentive Awards not theretofore exercisable, payable or free from
restrictions, as the case may be, shall immediately become exercisable, payable
or free from restrictions (other than restrictions required by applicable law
or any national securities exchange upon which any securities of Fleetwood are
then listed), as the case may be, in their entirety and any shares of Common
Stock acquired pursuant to an Incentive Award which are not fully vested shall
immediately become fully vested, notwithstanding any of the other provisions of
the Plan.

 

(c)                                  Upon the dissolution
or liquidation of Fleetwood or upon a reorganization, merger or consolidation
of Fleetwood with one or more corporations, as a result of which Fleetwood goes
out of existence or becomes a subsidiary of another corporation, or upon a sale
of substantially all of the property of Fleetwood to another corporation (in
each of such cases a “Termination Event”), this Plan shall terminate. Any
Option theretofore granted under the Plan and not exercised on or prior to the
Termination Event shall expire and terminate, unless provision be made in
writing in connection with such Termination Event for the assumption of the
Option or the substitution for such Option of a new option covering the stock
of a successor employer corporation, or a parent or subsidiary thereof or of
the Company, with appropriate adjustments as to number and kind of shares and
prices, in which event such Option shall continue in the manner and under the
terms so provided.

 

(d)                                 Adjustments under this
Section 8.1 will be made by the Committee, whose determination as to what
adjustments will be made and the extent thereof will be final, binding and
conclusive. No fractional interests will be issued under the Plan resulting
from any such adjustments.

 

8.2  Transferability of Incentive Awards

 

Incentive Awards, any interest therein, and
the right to receive the proceeds thereof shall not be transferable by a
Participant, other than (a) by will or the laws of descent and
distribution or (b) subject to the final sentence of this Section 8.2,
upon dissolution of marriage pursuant to a qualified domestic relations order
or, in the discretion of the Committee and under circumstances that would not
adversely affect the interests of the Company, transfers for estate

 

10

 

planning purposes or pursuant to a nominal transfer that does not
result in a change in beneficial ownership. The transfer by a Participant to a
trust created by the Participant for the benefit of the Participant or the
Participant’s family which is revocable at any and all times during the
Participant’s lifetime by the Participant and as to which the Participant is
the sole acting Trustee during his or her lifetime, will ordinarily not be
deemed to be a transfer for purposes of the Plan. Under such rules and
regulations as the Committee may establish pursuant to the terms of the Plan, a
beneficiary may be designated with respect to an Incentive Award in the event
of the death of a Participant. If the estate of the Participant is the
beneficiary with respect to an Incentive Award, any rights with respect to such
Incentive Award may be transferred to the person or persons or entity
(including a trust) entitled thereto under the will of such Participant or
pursuant to the laws of descent and distribution. Notwithstanding the
foregoing, Stock Options intended to be treated as Incentive Stock Options (or
other Awards subject to transfer restrictions under the IRC) may not be
assigned or transferred in violation of Section 422(b)(5) of the IRC or
the regulations thereunder, and nothing herein is intended to allow such
assignment or transfer.

 

8.3  Continuation of Employment

 

(a)                                  Nothing in the Plan
or in any statement evidencing the grant of an Incentive Award pursuant to the
Plan shall be construed to create or imply any contract of employment between
any Participant and the Company, to confer upon any Participant any right to
continue in the employ of the Company, or to confer upon the Company any right
to require any Participant’s continued employment. Except as expressly provided
in the Plan or in any statement evidencing the grant of an Incentive Award
pursuant to the Plan, the Company shall have the right to deal with each
Participant in the same manner as if the Plan and any such statement evidencing
the grant of an Incentive Award pursuant to the Plan did not exist, including,
without limitation, with respect to all matters related to the hiring,
discharge, compensation and conditions of the employment of the Participant.
Unless otherwise expressly set forth in a separate employment agreement between
the Company and such Participant, the Company or the Participant may terminate
the employment of any Participant with the Company at any time for any reason,
with or without cause.

 

(b)                                 Any question(s) as to
whether and when there has been a termination of a Participant’s employment,
the reason (if any) for such termination, and/or the consequences thereof under
the terms of the Plan or any statement evidencing the grant of an Incentive Award
pursuant to the Plan shall be determined by the Committee, and the Committee’s
determination thereof shall be final and binding.

 

8.4  Compliance with Government Regulations

 

No shares of Common Stock will be issued
pursuant to an Incentive Award unless and until all applicable requirements
imposed by federal and state securities and other laws, rules and regulations
and by any regulatory agencies having jurisdiction and by any stock exchanges
upon which the Common Stock may be listed have been fully met. As a condition
precedent to the issuance of shares of Common Stock pursuant to an Incentive
Award, the Company may require the Participant to take any reasonable action to
comply with such requirements.

 

8.5  Additional Conditions

 

The award of any benefit under this Plan also
may be subject to such other provisions (whether or not applicable to the
benefit award to any other Participant) as the Committee determines appropriate
including, without limitation, provisions to assist the Participant in financing
the purchase of Common Stock through the exercise of Stock Options, provisions
for the forfeiture of or restrictions on resale or other disposition of shares
of Common Stock acquired under any form of benefit, provisions giving the
Company the right to repurchase shares of Common Stock acquired under any form
of benefit in the event the Participant elects to dispose of such shares, and
provisions to comply with federal and state securities laws. The Company may
make such provisions as it deems appropriate for the withholding by the Company
pursuant to federal or state income tax laws of such amounts as the Company
determines it is required to withhold in connection with any Incentive Award.
The Company may require a Participant to satisfy any relevant tax requirements
before authorizing any issuance of Common Stock to such Participant or payment
of any other benefit hereunder to such Participant. Any such settlement shall
be made in the form of cash, a certified or bank cashier’s check or such other
form of consideration as is satisfactory to the Board.

 

11

 

8.6  Privileges of Stock Ownership

 

No Participant and no beneficiary or other
person claiming under or through such Participant will have any right, title or
interest in or to any shares of Common Stock allocated or reserved under the
Plan or subject to any Incentive Award, except as to such shares of Common
Stock or Restricted Stock, if any, that have been issued to such Participant in
accordance with the terms and conditions of the applicable Incentive Award.

 

8.7  Amendment and Termination of Plan: Amendment
of Incentive Awards

 

(a)                                  The Board may alter,
amend, suspend or terminate the Plan at any time. No such action of the Board,
unless taken with the approval of the stockholders of the Company, may increase
the maximum number of shares that may be sold or issued under the Plan, alter
the class of Employees eligible to participate in the Plan, or make other
material amendments to the Plan.

 

(b)                                 The Committee may,
with the consent of a Participant, and subject to Section 1.4(b), make
such modifications in the terms and conditions of an Incentive Award as it
deems advisable.

 

(c)                                  Except as otherwise
provided in this Plan or in the statement evidencing the grant of the Incentive
Award, no amendment, suspension or termination of the Plan will, without the
consent of the Participant, alter, terminate, impair or adversely affect any
right or obligation under any Incentive Award previously granted under the Plan.

 

8.8  Unfunded Status of Plan

 

The Plan is intended to constitute an
“unfunded” plan for incentive and deferred compensation. With respect to any
payments not yet made to a Participant by the Company, nothing contained herein
shall give any such Participant any rights that are greater than those of a
general creditor of the Company. In its sole discretion, the Committee may
authorize the creation of trusts or other arrangements to meet the obligations
created under the Plan to deliver Common Stock or payments in lieu of or with
respect to Incentive Awards hereunder, provided, however, that unless the
Committee otherwise determines with the consent of the affected Participant,
the existence of such trusts or other arrangements is consistent with the “unfunded”
status of the Plan.

 

8.9  Other Compensation Plans

 

The adoption of the Plan shall not affect any
other stock option, incentive or other compensation plans in effect for the
Company, nor shall the Plan preclude the Company from establishing any other
forms of incentive or other compensation for Employees of the Company.

 

8.10  Plan Binding on Successors

 

The Plan and any agreement with respect to an
Incentive Award shall be binding upon the successors and assigns of the Company
and upon each Participant and such Participant’s heirs, executors,
administrators, personal representatives, permitted assignees, and successors
in interest.

 

8.11  Singular, Plural; Gender

 

Whenever used herein, nouns in the singular
shall include the plural, and the masculine pronoun shall include the feminine
gender, as the context may require.

 

8.12  Applicable Law

 

This Plan shall be governed by, interpreted
under, and construed and enforced in accordance with the internal laws of the
State of California.

 

12

 

IX.                                EFFECTIVE
DATE AND DURATION OF PLAN

 

The Plan shall become effective on the later
of (a) the date of its adoption by the Board, (b) the date of its
approval by the holders of a majority of the outstanding shares of Common
Stock. The Plan shall terminate at such time as the Board, in its discretion,
shall determine, but in any event no later than September 11, 2011. No
Incentive Award may be granted under the Plan after the date of such
termination, but such termination shall not affect any Incentive Award
theretofore granted.

 

13Exhibit
10.2

 

FLEETWOOD
ENTERPRISES, INC.

1992
NONEMPLOYEE DIRECTOR STOCK OPTION PLAN

(As Amended Through March 1, 2004)

 

I.                                         GENERAL
PROVISIONS

 

1.1  Purposes of the Plan.  Fleetwood Enterprises, Inc. (the
“Company”) has adopted this 1992 Nonemployee Director Stock Option Plan (the
“Plan”) to enable the Company to attract and retain the services of experienced
and knowledgeable Nonemployee Directors and to align further their interests
with those of the stockholders of the Company by providing for or increasing
the proprietary interests of the Nonemployee Directors in the Company.

 

1.2  Definitions.  The following terms, when used in this Plan,
shall have the meanings set forth in this Section 1.2:

 

(a)                                  “Award”
means an award of any Stock Option under the Plan.

 

(b)                                 “Board”
or “Board of Directors” means the Board.

 

(c)                                  “Common
Stock” means the common stock of the Company, par value $1.00 per share.

 

(d)                                 “Company”
means Fleetwood Enterprises, Inc., a Delaware corporation, or any
successor thereto.

 

(e)                                  “Fair
Market Value” means the closing sale price of a share of Common Stock on the
New York Stock Exchange Composite Transactions on the date of a Stock Option is
granted, or if not granted on a trading day, on the immediately preceding
trading day.

 

(f)                                    “Nonemployee
Director” means any member of the Board of Directors who is not an employee of
the Company or of any parent or subsidiary corporation (as defined in
Section 424 of the Internal Revenue Code of 1986, as amended) with respect
to the Company.

 

(g)                                 “Participant”
means any Nonemployee Director who receives an Award pursuant to the terms of
the Plan.

 

(h)                                 “Plan”
means the Fleetwood Enterprises, Inc. 1992 Nonemployee Director Stock
Options Plan as set forth herein, as amended from time to time.

 

(i)                                     “Stock
Option” means a right to purchase Common Stock which is the subject of an Award
under this Plan and the provisions of Article III hereof.

 

1.3  Common Shares Subject to Plan.

 

(a)                                  Subject
to the provisions of Sections 1.3(c) and 4.1, the maximum number of shares of
Common Stock which may be issued pursuant to Awards under this Plan shall not
exceed 400,000 shares.

 

(b)                                 The
shares of Common Stock to be delivered under the Plan shall be made available,
at the discretion of the Board of Directors, either from authorized but
unissued shares of Common Stock, or from previously issued shares of Common
Stock reacquired by the Company, including shares purchased in the open market.

 

(c)                                  Shares
of Common Stock subject to the unexercised portion of any Stock Option granted
under this Plan that expires, terminates or is canceled will again become
available for grant of further Awards under this Plan.

 

 

II.                                     AWARDS
OF STOCK OPTIONS

 

2.1  Award Grants

 

(a)                                  Upon
the first business day following the effective date of this Plan, as determined
pursuant to Section 5.2 hereof, and on the first business day following
any annual meeting of the stockholders of the Company in each calendar year
thereafter for so long as this Plan remains in effect, each Nonemployee
Director who is then serving as a member of the Board of Directors shall
automatically be granted an Award consisting of Stock Options The number of
Stock Options included in such Award shall be the number, rounded to the
nearest one hundred, that is equal to (i) $50,000 divided by (ii) the value of
the purchase price of each such option, such value to be determined using the
Black-Scholes formula for stock option valuations.

 

(b)                                 Each
Nonemployee Director who is appointed or elected other than at an annual
meeting of stockholders of the Company (whether by replacing a director who
retires, resigns or otherwise terminates his service as a director prior to the
expiration of his term or otherwise) shall automatically be granted an Award as
of the date of such appointment consisting of a number of shares of Common
Stock determined by multiplying 4,000 by a fraction, the numerator of which is
the number of days from the date of grant to the date of the next scheduled
annual meeting of stockholders of the Company and the denominator of which is
365 (exclusive of fractional shares).

 

2.2  Award Procedures.  All Nonemployee Directors shall receive
Awards under this Plan, which Awards shall be granted automatically as provided
in this Article II. A Nonemployee Director to whom an Award has been made
shall be notified of the Award, and the Company shall promptly cause to be
prepared and executed a written agreement evidencing the Stock Options which
are the subject of such Award.

 

2.3  Securities Law Requirements.  Shares of Common Stock shall not be offered
or issued under this Plan unless the offer, issuance and delivery of such
shares shall comply with all applicable provisions of law, domestic or foreign,
including, without limitation, the Securities Act of 1933, as amended, the California
Corporate Securities Law of 1968, as amended, and the requirements of any stock
exchange upon which the Common Stock may then be listed. As a condition
precedent to the issuance of shares of Common Stock pursuant to an Award, the
Company may require the Participant to take any reasonable action to comply
with such requirements.

 

III.                                 STOCK
OPTIONS

 

3.1  Purchase Price.  The purchase price of Common Stock issuable
upon exercise of each Stock Option shall be the Fair Market Value, as of the
date of grant of the Stock Option, of the Common Stock subject to such Stock
Option.

 

3.2  Stock Option Term.  Unless earlier exercised or terminated
pursuant to the provisions of Section 3.4, each Stock Option shall expire
and no longer be exercisable on a date which is ten years after the date of
grant.

 

3.3  Exercise of Stock Options.  Options granted shall become exercisable
immediately upon issuance. Options shall remain exercisable until the Stock
Option is exercised or expires as provided in this Article III. At the
time of the exercise of a Stock Option, the purchase price shall be paid in
full in cash, or in shares of Common Stock valued at their Fair Market Value on
the exercise date. No fractional shares will be issued pursuant to the exercise
of a Stock Option, nor will any cash payment be made in lieu of fractional
shares.

 

3.4  Termination of Director Status.  In the event that the holder of Stock
Options ceases to be a director of the Company for any reason (“Termination”),
all Stock Options shall thereafter be exercisable until the earlier to occur of
three years from the date of Termination or ten years from the date of the
grant of such Stock Option.

 

3.5  Rights With Respect to Common Stock.  No Participant and no beneficiary or other
person claiming under or through such Participant will have any right, title or
interest in or to any shares of Common Stock subject to any Stock Option unless
and until such Stock Option is duly exercised pursuant to the terms of this
Plan.

 

 

IV.                                ADJUSTMENT
PROVISIONS

 

4.1  Changes in Outstanding Securities.  Subject to Section 4.2 below,
(i) if the outstanding shares of Common Stock of the Company are
increased, decreased or exchanged for a different number or kind of shares or
other securities of the Company, or if additional shares or new or different
shares or other securities of the Company are distributed in respect of such
shares of Common Stock (or any stock or securities received with respect to
such Common Stock), through reorganization, recapitalization, reclassification,
stock dividend, stock split, reverse stock split, spin-off or other
distribution with respect to such shares of Common Stock (or any stock or
securities received with respect to such Common Stock), or (ii) if the
value of the outstanding shares of Common Stock of the Company is reduced by
reason of an extraordinary cash dividend, an appropriate and proportionate
adjustment may be made in (x) the maximum number and kind of shares
provided in Section 1.3, (y) the number and kind of shares or other
securities subject to then outstanding Stock Options, and (z) the purchase
or exercise price for each share of Common Stock subject to an outstanding
Stock Option.

 

4.2  Termination Events.  Upon the dissolution or liquidation of the
Company or upon a reorganization, merger or consolidation of the Company with
one or more corporations, as a result of which the Company goes out of
existence or becomes a subsidiary of another corporation, or upon a sale of
substantially all of the property of the Company to another corporation (in
each of such cases a “Termination Event”), this Plan shall terminate. Any Stock
Option therefore granted under the Plan and not exercised on or prior to the
Termination Event shall expire and terminate, unless provisions be made in
writing in connection with such Termination Event for the assumption of the
Stock Option or the substitution for such Stock Option of a new option covering
the stock of a successor corporation, or a parent or subsidiary thereof or of
the Company, with appropriate adjustments as to number and kind of shares and
prices, in which event such Stock Option shall continue in the manner and under
the terms so provided.

 

4.3  Other Adjustments.  Adjustments under this Article IV will
be made by the Board, whose determination as to what adjustments will be made
and the extent thereof will be final, binding and conclusive. No fractional
interests will be issued under the Plan resulting from any such adjustments.

 

V.                                    MISCELLANEOUS
PROVISIONS

 

5.1  Amendment, Suspension, Termination or
Interpretation of the Plan.

 

(a)                                  The Board of
Directors may at any time amend, suspend, or terminate the Plan; provided,
however, that no such action shall:

 

(i)                                     increase
the maximum number of shares specified in Section 1.3(a), unless approved
by the stockholders of the Company;

 

(ii)                                  alter,
terminate or impair in any manner which is materially adverse to a Participant
any Award previously granted;

 

(iii)                               change
the nondiscretionary manner in which Awards are made under Article II; or

 

(iv)                              change
more than once in any six-month period, provisions of the Plan dealing with the
amount of any Award, the purchase price of the Common Stock which is the
subject of any Award, or the timing of the grant or exercise with respect to
Awards.

 

(b)                                 Plan
Interpretation.  Questions of
interpretation of any of the provisions of the Plan shall be resolved by
competent legal counsel selected by the Chief Executive Officer of the Company.

 

5.2  Effective Date and Duration of Plan.  This Plan has been approved by the Board and
shall become effective on the date of its approval by the holders of a majority
of the outstanding shares of Common Stock present in person or by proxy and
entitled to vote at a meeting of the stockholders of the Company. This Plan
shall terminate at such time as the Board, in its discretion, shall determine,
but in any event no later than September 9, 2011. No Award may be granted
under the Plan after the date of such termination, but such termination shall
not affect any Award theretofore granted and any shares of Common stock subject
thereto.

 

 

5.3  Director Status.  Nothing in this Plan or in any instrument
executed pursuant hereto shall confer upon any Nonemployee Director any right
to continue as a member of the Board of Directors of the Company or any
subsidiary thereof.

 

5.4  No Entitlement to Shares.  No Nonemployee Director (individually or as
a member of a group), and no beneficiary or other person claiming under or
through such Nonemployee Director, shall have any right, title or interest in
or to any shares of Common Stock allocated or reserved for the purpose of the
Plan or subject to any Award except as to such shares of Common Stock, if any,
as shall have been issued to such Nonemployee Director.

 

5.5  Withholding of Taxes.  The Company may make such provisions as it
deems appropriate for the withholding by the Company pursuant to federal or
state income tax laws of such amounts as the Company determines it is required
to withhold in connection with any Award. The Company may require a Participant
to satisfy any relevant tax requirements before authorizing any issuance of
Common Stock to such Participant or payment of any other benefit hereunder to
such Participant. Any such settlement shall be made in the form of cash, a bank
cashier’s check or such other form of consideration as is satisfactory to the
Board.

 

5.6  Transferability.  Awards, any interest therein, and the right
to receive the proceeds thereof shall not be transferable by a Participant,
other than (a) by will or the laws of descent and distribution or
(b) upon dissolution of marriage pursuant to a qualified domestic
relations order or, in the discretion of the Board and under circumstances that
would not adversely affect the interests of the Company, transfers for estate
planning purposes or pursuant to a nominal transfer that does not result in a
change in beneficial ownership. The transfer by a Participant to a trust
created by the Participant for the benefit of the Participant or the
Participant’s family which is revocable at any and all times during the
Participant’s lifetime by the Participant and as to which the Participant is
the sole trustee during his or her lifetime will not be deemed to be a transfer
for purposes of the Plan. Under such rules and regulations as the Committee may
establish pursuant to the terms of the Plan, a beneficiary may be designated
with respect to an Award in the event of the death of a Participant. If the
estate of the Participant is the beneficiary with respect to an Award, any rights
with respect to such Award may be transferred to the person or persons or
entity (including a trust) entitled thereto under the will of such Participant
or pursuant to the laws of descent and distribution.

 

5.7  Other Plans.  Nothing in this Plan is intended to be a
substitute for, or shall preclude or limit the establishment or continuation
of, any other plan, practice or arrangement for the payment of compensation or
benefits to directors generally, which the Company now has or may hereafter
lawfully put into effect, including, without limitation, any retirement,
pension, insurance, stock purchase, incentive compensation or bonus plan.

 

5.8  Singular, Plural; Gender.  Whenever used herein, nouns in the singular
shall include the plural, and the masculine pronoun shall include the feminine
gender, as the context may require.

 

5.9  Applicable Law.  This Plan shall be governed by, interpreted
under, and construed and enforced in accordance with the internal laws of the
State of California.

 

5.10  Successors and Assigns.  The Plan and any agreement with respect to
an Award shall be binding upon the successors and assigns of the Company and
upon each Participant and such Participant’s heirs, executors, administrators,
personal representatives, permitted assignees and successors in interest.

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