EXHIBIT 10.1
POLARIS INDUSTRIES INC.
DEFERRED COMPENSATION PLAN FOR DIRECTORS
Section
1.
INTRODUCTION
1.1
ESTABLISHMENT. Polaris Industries Inc., a
Minnesota corporation (the “Company”), hereby
establishes the Polaris Industries Inc. Deferred Compensation Plan
for Directors (the “Plan”) for those directors of the
Company who are neither officers nor employees of the Company. The
Plan provides (i) for the grant of awards in the form of
Common Stock Equivalents to Directors and (ii) the opportunity
for Directors to defer receipt of all or a part of their cash
compensation and thereby be credited with additional Common Stock
Equivalents.
1.2
PURPOSES. The purposes of the Plan are to align
the interests of Directors more closely with the interests of other
shareholders of the Company, to encourage the highest level of
Director performance by providing the Directors with a direct
interest in the Company’s attainment of its financial goals,
and to provide a financial incentive that will help attract and
retain the most qualified Directors.
1.3 EFFECTIVE
DATE. This Plan was originally effective as of
January 26, 1995, the date of its initial approval by the
Board of Directors and amended and restated effective as of
January 1, 2008. The Plan was further amended and restated by
the Board of Directors as of January 22, 2009.
Section
2.
DEFINITIONS
2.1
DEFINITIONS. The following terms shall have the
meanings set forth below:
(a)
“Board” means the Board of Directors of the
Company.
(b)
“Change in Control” means any of the events set
forth below:
(i) The acquisition
in one or more transactions, other than from the Company, by any
individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of a number of voting securities of the Company
in excess of 30% of the voting securities of the Company unless
such acquisition has been approved by the Board; or
(ii) Any election
has occurred of persons to the Board that causes two-thirds of the
Board to consist of persons other than (A) persons who were
members of the Board on the effective date of the Plan and
(B) persons who were nominated for elections as members of the
Board at a time when two-thirds of the Board consisted of persons
who were members of the Board on the effective date of the Plan;
provided, however, that any person nominated for election by a
Board at least two-thirds of whom constituted persons described in
clauses (A) and/or (B) or by persons who were themselves
nominated by such Board shall, for this purpose, be deemed to have
been nominated by a Board composed of persons described in clause
(A); or
(iii) Approval by
the shareholders of the Company of a reorganization, merger or
consolidation, unless, following such reorganization, merger or
consolidation, all or substantially all of the individuals and
entities who were the respective beneficial owners of the voting
securities of the Company immediately prior to such reorganization,
merger or consolidation, following such reorganization, merger or
consolidation beneficially own, directly or indirectly, more than
60% of the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors
of the entity resulting from such reorganization, merger or
consolidation in substantially the same proportion as their
ownership of the voting securities of the Company immediately prior
to such reorganization, merger or consolidation, as the case may
be; or
(iv) A sale or
other disposition of all or substantially all the assets of the
Company.
Notwithstanding the
foregoing, no event will constitute a Change in Control unless such
event is a change in the ownership or effective control of the
corporation, or in the ownership of a substantial
1
portion of the assets of the
Corporation within the meaning of Section 409A(2)(A)(v) of the
Code and the regulations thereunder.
(c)
“Committee” means the Compensation Committee of
the Board of Directors of the Company or such other committee of
the Board as the Board may designate.
(d)
“Common Stock Equivalent” means a hypothetical
share of Stock which shall have a value on any date equal to the
Fair Market Value of one share of Stock on that date.
(e)
“Common Stock Equivalent Award” means an award
of Common Stock Equivalents granted to a Director pursuant to
Section 5.1 of the Plan.
(f)
“Deferred Stock Account” means the bookkeeping
account established by the Company in respect to each Director
pursuant to Section 5.4 hereof and to which shall be credited
Common Stock Equivalents pursuant to the Plan.
(g)
“Director” means a member of the Board who is
neither an officer nor an employee of the Company. For purposes of
the Plan, an employee is an individual whose wages are subject to
the withholding of federal income tax under section 3401 of
the Internal Revenue Code, and an officer is an individual elected
or appointed by the Board or chosen in such other manner as may be
prescribed in the Bylaws of the Company to serve as
such.
(h)
“Exchange Act” means the Securities Exchange Act
of 1934, as amended from time to time.
(i) “Fair
Market Value” means as of any applicable date:
(i) if the Stock is listed on a national securities exchange
or is authorized for quotation on the National Association of
Securities Dealers Inc.’s NASDAQ National Market System
(“NASDAQ/NMS”), the closing price, regular way, of the
Stock on such exchange or NASDAQ/NMS, as the case may be, or if no
such reported sale of the Stock shall have occurred on such date,
on the next preceding date on which there was such a reported sale;
or (ii) if the Stock is not listed for trading on a national
securities exchange or authorized for quotation on NASDAQ/NMS, the
closing bid price as reported by the National Association of
Securities Dealers Automated Quotation System
(“NASDAQ”), or if no such prices shall have been so
reported for such date, on the next preceding date for which such
prices were so reported; or (iii) if the Stock is not listed
for trading on a national securities exchange or authorized for
quotation on NASDAQ, the last reported bid price published in the
“pink sheets” or displayed on the NASD Electronic
Bulletin Board, as the case may be; or (iv) if the Stock
is not listed for trading on a national securities exchange, or is
not authorized for quotation on the NASD Electronic
Bulletin Board, the Fair Market Value of the Stock as
determined in good faith by the Committee.
(j)
“Internal Revenue Code” means the Internal
Revenue Code of 1986, as amended from time to time.
(k)
“Stock” means the $.01 par value common
stock of the Company.
(l)
“Quarterly Payment Date” means each of the four
dates each year on which the Company pays retainer fees to
Directors.
2.2 GENDER AND
NUMBER. Except when otherwise indicated by the
context, the masculine gender shall also include the feminine
gender, and the definitions of any term herein in the singular
shall also include the plural.
Section
3.
PLAN ADMINISTRATION
The Plan shall be
administered by the Committee. Subject to the limitations of the
Plan, the Committee shall have the sole and complete authority:
(i) to impose such limitations, restrictions and conditions
upon such awards as it shall deem appropriate, (ii) to
interpret the Plan and to adopt, amend and rescind administrative
guidelines and other rules and regulations relating to the Plan and
(iii) to make all other determinations and to take all other
actions necessary or advisable for the impl
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