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EXHIBIT 10.3
TEKTRONIX, INC.
STOCK DEFERRAL PLAN
2005 Restatement
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TABLE OF CONTENTS
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ARTICLE I--PURPOSE AND EFFECTIVE
DATE.................................... 1
1.1
Purpose.......................................................
1
1.2 Effective
Dates............................................... 1
ARTICLE
II--DEFINITIONS..................................................
1
2.1
Account.......................................................
1
2.2 Administrative
Committee...................................... 2
2.3
Beneficiary...................................................
2
2.4
Board.........................................................
2
2.5
Bonus.........................................................
2
2.6 Change in
Control............................................. 2
2.7
Company.......................................................
3
2.8
Compensation..................................................
3
2.9 Deferral
Commitment........................................... 3
2.10 Deferral
Period............................................... 3
2.11 Determination
Date............................................ 3
2.12
Director......................................................
3
2.13 Director
Fees................................................. 3
2.14
Disability....................................................
3
2.15 Earnings
Index................................................ 4
2.16 Elective Deferred
Compensation................................ 4
2.17 Eligible Stock
Option......................................... 4
2.18
Employer......................................................
4
2.19 Option
Gain...................................................
4
2.20
Participant...................................................
4
2.21 Participation
Agreement....................................... 4
2.22
Plan..........................................................
4
2.23 Rate of
Return................................................ 4
2.24
Retirement....................................................
4
2.25
Salary........................................................
5
2.26
Stock.........................................................
5
2.27 Stock Option
Deferral......................................... 5
2.28 Stock Option Deferral
Amount.................................. 5
2.29 Unforeseen
Emergency.......................................... 5
2.30 Prior Plan
Amounts............................................ 5
ARTICLE III--PARTICIPATION AND DEFERRAL
COMMITMENTS...................... 6
3.1 Eligibility and
Participation................................. 6
3.2 Form of
Deferral.............................................. 6
3.3 Limitations on
Deferral Commitments........................... 6
3.4 Commitment
Limited by Termination............................. 7
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ARTICLE IV--DEFERRED COMPENSATION
ACCOUNTS............................... 7
4.1
Accounts......................................................
7
4.2 Elective
Deferred Compensation................................ 7
4.3 Matching
Contribution Makeup.................................. 8
4.4 Pension
Makeup................................................ 8
4.5 Determination of
Accounts..................................... 8
4.6 Vesting of
Accounts........................................... 8
4.7 Statement of
Accounts......................................... 8
ARTICLE V--PLAN
BENEFITS.................................................
8
5.1 Distributions
Prior to Termination of Employment.............. 8
5.3 Benefit
Commencement.......................................... 10
5.5 Deferred Payment
of Benefit................................... 11
5.6 Withholding for
Taxes......................................... 11
5.7 Valuation and
Settlement...................................... 11
5.8 Payment to
Guardian........................................... 11
ARTICLE VI--BENEFICIARY
DESIGNATION...................................... 11
6.1 Beneficiary
Designation....................................... 11
6.2 Changing
Beneficiary.......................................... 12
6.3 No Beneficiary
Designation.................................... 12
6.4 Effect of
Payment............................................. 12
ARTICLE
VII--ADMINISTRATION..............................................
12
7.1 Committee;
Duties............................................. 12
7.2
Agents........................................................
12
7.3 Binding Effect
of Decisions................................... 12
7.4 Indemnity of
Committee........................................ 12
ARTICLE VIII--CLAIMS
PROCEDURE........................................... 13
8.1
Claim.........................................................
13
8.2 Denial of
Claim............................................... 13
8.3 Review of
Claim............................................... 13
8.4 Final
Decision................................................
13
ARTICLE IX--AMENDMENT AND TERMINATION OF
PLAN............................ 13
9.1
Amendment.....................................................
13
9.2 Employer's Right
to Terminate................................. 14
ARTICLE
X--MISCELLANEOUS.................................................
15
10.1 Unfunded
Plan................................................. 15
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10.2 Unsecured General
Creditor.................................... 15
10.3 Trust
Fund....................................................
15
10.4
Nonassignability..............................................
16
10.5 Not a Contract of
Employment.................................. 16
10.6 Protective
Provisions......................................... 16
10.7 Governing
Law................................................. 16
10.8
Validity......................................................
16
10.9
Notice........................................................
16
10.10
Successors....................................................
16
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TEKTRONIX, INC.
STOCK DEFERRAL PLAN
2005 Restatement
ARTICLE I--PURPOSE AND EFFECTIVE DATE
1.1 Purpose
The purpose of
this Stock Deferral Plan is to provide current tax planning
opportunities as well as supplemental funds
upon the retirement or death of
certain Directors and employees of
Employer. It is intended that the Plan will
aid in attracting and retaining Directors
and employees of exceptional ability
by providing them with these benefits. The
Plan became effective as of May 27,
2001. The Plan was restated as of June 1,
2001 to include Directors as eligible
Plan Participants. The Plan was most
recently amended September 8, 2003. This
2005 Restatement is adopted to change the
Deferral Period for Directors, comply
with section 409A of the Internal Revenue
Code ("Code") and provide for further
changes to comply with Code Section 409A as
further guidance becomes available,
and make other clarifying and
administrative changes.
1.2 Effective Dates
This 2005 Restatement
is generally effective January 1, 2005 except as
expressly provided otherwise and as
follows:
(a) The Deferral Period that ends August 31, 2005 shall remain
effective. No
deferral of Director Fees will be allowed for services
performed from
September 23, 2005 to December 31, 2005.
(b) Effective January 1, 2006, the Deferral Period for Directors
shall
be the calendar
year and Deferral Commitments for Directors Fees for
services in the
2006 calendar year must be submitted by December 31, 2005
in accordance
with Section 3.1(b).
ARTICLE II--DEFINITIONS
For the purposes
of this Plan, the following terms shall have the meanings
indicated, unless the context clearly
indicates otherwise:
2.1 Account
"Account" means
the device used by Employer to measure and determine the
amounts to be paid to a Participant under
the Plan. Separate subaccounts may be
maintained to properly reflect the
Participant's balance and earnings thereon. A
Participant's Account shall not constitute
or be treated as a trust fund of any
kind.
PAGE 1 - STOCK DEFERRAL PLAN
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2.2 Administrative Committee
"Administrative
Committee" means the committee appointed to administer the
Plan pursuant to Article VII.
2.3 Beneficiary
"Beneficiary"
means the person, persons or entity entitled under Article VI
to receive any Plan benefits payable after
a Participant's death.
2.4 Board
"Board" means
the Board of Directors of the Company.
2.5 Bonus
"Bonus" means
any incentive compensation to a Participant under the Annual
Performance Incentive Plan.
2.6 Change in Control
A "Change in
Control" shall occur when:
(a) The shareholders of the Company approve one (1) of the
following
("Approved
Transactions") and either (x) such Approved Transaction is
consummated or
(y) the Board determines that consummation of such Approved
Transaction is
likely:
(i) Any consolidation, merger or plan of exchange involving the
Company ("Merger") in which the Company is not the continuing
or
surviving corporation or pursuant to which Stock would be
converted
into cash, securities or other property, other than a Merger
involving
the Company in which the holders of Stock immediately prior to
the
Merger have the same proportionate ownership of Stock of the
surviving
corporation after the Merger; or
(ii) Any sale, lease, exchange, or other transfer (in one (1)
transaction or a series of related transactions) of all or
substantially all of the assets of the Company or the adoption of
any
plan or proposal for the liquidation or dissolution of the Company;
or
(b) A tender or exchange offer, other than one made by the Company,
is
made for Stock
(or securities convertible into Stock) and such offer
results in a
portion of those securities being purchased and the offeror
after the
consummation of the offer is the beneficial owner (as
determined
pursuant to
Section 13(d) of the Securities Exchange Act of 1934, as
amended (the
"Exchange Act")), directly or indirectly, of at least twenty
percent (20%) of
the outstanding Stock (an "Offer"); or
(c) During any period of twelve (12) months or less, individuals
who
at the beginning
of such period constituted a majority of the Board cease
for any reason
to constitute a majority thereof unless the nomination or
election of such
new directors was approved by a vote of at least
two-thirds (2/3)
of the directors then still in office who were directors
at the beginning
of such period.
The terms used in this 2.6 and not defined elsewhere in the Plan
shall
have the same
meanings as such terms have in the Exchange Act and the rules
and regulations
adopted thereunder.
PAGE 2 - STOCK DEFERRAL PLAN
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2.7 Company
"Company" means
Tektronix, Inc., an Oregon corporation, or any successor to
the business thereof.
2.8 Compensation
"Compensation"
means the Salary, Bonus, Directors' Fees, and Option Gain
that the Participant earns for services
rendered to the Company.
2.9 Deferral Commitment
"Deferral
Commitment" means an election to defer Compensation made by a
Participant pursuant to Article III and for
which a separate Participation
Agreement has been submitted by the
Participant to the Administrative Committee.
2.10 Deferral Period
For Directors,
"Deferral Period" means a twelve (12)-month period beginning
September 1 and ending August 31. Effective
January 1, 2006, "Deferral Period"
for Directors means a calendar year.
For employees,
"Deferral Period" means a calendar year.
2.11 Determination Date
"Determination
Date" means the last day of each calendar month.
2.12 Director
"Director" means
a member of the Company's Board of Directors.
2.13 Director Fees
"Director Fees"
means all Board retainer and committee meeting fees earned
and payable in cash or stock payable to a
Participant plus Eligible Stock Option
gains (before reduction for amounts
deferred under this Plan or under the
Deferred Compensation Plan). Director Fees
do not include expenses,
reimbursements, or benefits.
2.14 Disability
A Participant
shall be considered to have terminated employment or Board
Service because of "Disability" if either
of the following apply:
(a) The Participant is unable to engage in any substantial
gainful
activity by
reason of any medically determinable physical or mental
impairment which
can be expected to result in death or can be expected to
last for a
continuous period of not less than 12 months.
(b) The Participant is, by reason of any medically determinable
physical or
mental impairment which can be expected to result in death or
can be expected
to last for a continuous period of not less than 12 months,
receiving income
replacement benefits for a period of not less than 3
months under an
accident and health plan covering employees of the
Participant's
employer.
PAGE 3 - STOCK DEFERRAL PLAN
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2.15 Earnings Index
"Earnings Index"
means the Tektronix Common Shares to be used as an index
in calculating Rate of Return.
2.16 Elective Deferred Compensation
"Elective
Deferred Compensation" means the amount of Compensation that a
Participant elects to defer pursuant to a
Deferral Commitment.
2.17 Eligible Stock Option
"Eligible Stock
Option" means one (1) or more nonqualified stock option(s)
under a Company stock option plan that is
determined by the Committee to be
eligible for gain deferral pursuant to this
Plan.
2.18 Employer
"Employer" means
the Company or any successor to the business thereof, and
any affiliated or subsidiary corporations
designated by the Administrative
Committee.
2.19 Option Gain
"Option Gain"
means the amount by which the fair market value of exercised
Tektronix Common Share options exceeds the
exercise price.
2.20 Participant
"Participant"
means any eligible individual who has elected to defer
Compensation under this Plan.
2.21 Participation Agreement
"Participation
Agreement" means the agreement submitted by a Participant
(including the Benefit Payment Election
Form) to the Administrative Committee
prior to the beginning of the Deferral
Period, with respect to a Deferral
Commitment made for such Deferral
Period.
2.22 Plan
"Plan" means
this Tektronix, Inc. Stock Deferral Plan, as amended from time
to time.
2.23 Rate of Return
"Rate of Return"
means the rate used to determine the amount credited
monthly to a Participant's Account under
Article IV. Such rate shall be
determined by the Administrative Committee
based upon the net performance of the
Earnings Index of the Tektronix Common
Shares.
2.24 Retirement
"Retirement"
means an employee's termination of employment with Employer on
or after the later of the employee's
attainment of age fifty-five (55) or
completion of five (5) years of service, or
a Board member's termination of
service after attainment of age fifty-five
(55).
PAGE 4 - STOCK DEFERRAL PLAN
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2.25 Salary
"Salary" means
the Employee's base salary for the Plan Year. Salary
excludes any other form of compensation
such as restricted stock, proceeds from
stock options or stock appreciation rights,
severance payments, moving expenses,
car or other special allowance, or any
other amounts included in an Eligible
Employee's taxable income that is not base
salary. Deferral elections shall be
computed before taking into account any
reduction in taxable income by Salary
reduction under Code Sections 125, 132(f)
or 401(k), or under this Plan.
2.26 Stock
"Stock" means
Tektronix, Inc. Common Shares.
2.27 Stock Option Deferral
"Stock Option
Deferral" means a stock-for-stock exercise of an Eligible
Stock Option having an aggregate fair
market value in excess of the total stock
purchase price necessary to exercise such
options.
2.28 Stock Option Deferral Amount
"Stock Option
Deferral Amount" means the amount of a Participant's Option
Gains deferred in connection with an
Eligible Stock Option exercise and Stock
Option Deferral in accordance with Section
4.2(c) of this Plan.
2.29 Unforeseen Emergency
"Unforeseen Emergency" means a severe financial hardship to the
Participant
resulting from a sudden and unexpected illness or accident of
the Participant,
the Participant's spouse, or a dependent (as defined in
Section 152(a)
of the Internal Revenue Code) of the Participant, loss of
the
Participant's property due to casualty, or other similar
extraordinary
and
unforeseeable circumstances arising as a result of events beyond
the
control of the
Participant. The circumstances that will constitute an
Unforeseen
Emergency will depend upon the facts of each case, but in any
case, the
amounts distributed with respect to an Unforeseen Emergency
shall
not exceed the
amounts necessary to satisfy such emergency plus amounts
necessary to pay
taxes reasonably anticipated as a result of the
distribution,
after taking into account the extent to which such hardship
is or may be
relieved through reimbursement or compensation by insurance or
otherwise or by
liquidation of the Participant's assets (to the extent the
liquidation of
such assets would not itself cause severe financial
hardship).
2.30 Prior Plan Amounts
"Prior Plan Amounts" means amounts that are 100 percent (100%)
vested
as of December 31,
2004 (and related earnings credit after December 31,
2004) and are
either of the following :
(a) Credited to a Participant's account with respect to a
Determination
Period that ends on or before December 31, 2004.
(b) Credited to a Participant's account before January 1, 2005
with
respect to a
Determination Period that begins before January 1, 2005
pursuant to
Deferral Commitment delivered and in effect before October 3,
2004.
PAGE 5 - STOCK DEFERRAL PLAN
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ARTICLE III--PARTICIPATION AND DEFERRAL COMMITMENTS
3.1 Eligibility and Participation
(a) ELIGIBILITY. Eligibility to participate in the Plan is limited
to
Directors and
Vice Presidents and above and any other highly compensated
employee
selected by the Administrative Committee.
(b) PARTICIPATION. Eligible employees and Directors may elect
to
participate in
the Plan with respect to any Deferral Period by submitting a
Participation
Agreement to the Administrative Committee by the December 31
immediately
preceding the Deferral Period except as provided in (c) and (d)
below.
(c) PART-YEAR PARTICIPATION. If a Director or an employee first
becomes eligible
to defer Compensation during a Deferral Period, a
Participation
Agreement must be submitted to the Administrative Committee
no later than
thirty (30) days following eligibility to defer, and such
Participation
Agreement shall be effective only with regard to Compensation
with respect to
services to be performed following the submission of the
Participation
Agreement to the Administrative Committee.
(d) BONUS. An employee must separately elect to defer amounts
with
respect to Bonuses under the
Annual Performance Incentive Plan. The
Participation
Agreement must be submitted to the Administrative Committee
not later than
six (6) months before the end of the Company fiscal year for
which the Bonus,
if any, will be paid.
3.2 Form of Deferral
A Participant
may elect Deferral Commitments in the Participation Agreement
as follows:
(a) SALARY DEFERRAL COMMITMENT. A Salary Deferral Commitment shall
be
related to the
Salary payable by Employer to a Participant for services to
be performed
during the Deferral Period. The amount to be deferred into the
Participant's
Stock subaccount shall be stated as a whole number percentage
or dollar amount
of each installment of Salary.
(b) BONUS DEFERRAL COMMITMENT. A Bonus Deferral Commitment shall
be
related to any
Bonus payable under the Annual Performance Incentive Plan to
the Participant
for services to be performed during the Company fiscal year
for which the
Bonus will be paid. The amount to be deferred into the
Participant's
Stock subaccount shall be stated as a whole number percentage
or dollar amount
of the Bonus.
(c) STOCK OPTION DEFERRAL COMMITMENT. To the extent permitted by
the
Committee, a
Participant may elect to defer into his or her Stock
subaccount all
or a portion of his or her Option Gain, subject to such
terms and
conditions as the Committee may establish.
(d) DIRECTOR FEES DEFERRAL COMMITMENT. A Director Fees
Commitment
shall relate to
the payment of stock for services as a Director to be
performed during
the Deferral Period, Eligible Stock Option gains and
Director fee
payable in cash for Director services to be performed during
the Deferral Period. The
amount to be deferred into the Participant's Stock
subaccount s
