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EXHIBIT 10.2
WOLVERINE WORLD WIDE, INC.
OUTSIDE DIRECTORS' DEFERRED COMPENSATION PLAN
FOR BENEFITS ACCRUED BEGINNING JANUARY 1,
2005
ARTICLE 1
Establishment of Plan; Purposes of Plan
1.1
Establishment of Plan . The Company hereby
establishes the WOLVERINE WORLD WIDE, INC. OUTSIDE DIRECTORS'
DEFERRED COMPENSATION PLAN FOR BENEFITS ACCRUED BEGINNING JANUARY
1, 2005 (the "Plan"), a supplemental nonqualified deferred
compensation plan for the Outside Directors of the Company. The
Plan continues the Outside Directors' Deferred Compensation Plan
that went into effect April 17, 1996 (the "1996 Plan") and the
Amended and Restated Plan effective February 15, 2002 (the "2002
Plan"). This document is separately drafted to comply for 2005 and
subsequently accrued benefits with Section 409A of the Internal
Revenue Code of 1986, as amended (the "Code") and to preserve the
grandfathered status of benefits accrued under the 1996 and 2002
plans prior to January 1, 2005. The Plan shall be an unfunded plan
within the meaning of the Internal Revenue Code of 1986, as
amended. It is intended that the Plan not cover employees and
therefore not be subject to the Employee Retirement Income Security
Act of 1974, as amended.
1.2
Purposes of Plan . The purposes of the Plan
are to attract and retain well qualified individuals for service as
Outside Directors of the Company, to provide Outside Directors with
the opportunity to increase their financial interest in the
Company, and thereby increase their personal interest in the
Company's continued success through the payment of retirement
income to Outside Directors in amounts tied to the performance of
the Company's Common Stock and payable in Common Stock, and to
provide Outside Directors with the opportunity to accumulate
supplemental assets for retirement through the deferral of all or a
portion of Director's Fees payable to Outside Directors.
1.3
Effective Date . The "Effective Date" of this
Plan is January 1, 2005. No Common Stock shall be issued under the
Plan prior to such stockholder approval. Each Plan provision
applies until the effective date of an amendment of that
provision.
1.4
Number of Stock Units . Subject to adjustment
as provided in Section 6.1 of the Plan, a maximum of 400,000 Stock
Units (not including any adjustments occurring before the date of
this amendment pursuant to Section 6.1), which are convertible into
Common Stock at a one-to-one ratio upon distribution, together with
400,000 shares of Common Stock (not including any adjustments
occurring before the date of this amendment pursuant to Section
6.1), shall be available for awards in the aggregate under the 1996
Plan, 2002 Plan and this Plan.
1.5
Application to Former Participants . This Plan
applies to former Participants who have accrued benefits under this
Plan and controls, among other things, the timing, manner and form
of any future distribution that is based on amounts deferred and
reflected in the Account.
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ARTICLE 2
Definitions
2.1
Beneficiary . "Beneficiary" means the
individual, trust or other entity designated by the Participant to
receive any benefits to be distributed under the Plan after the
Participant's death. A Participant may designate or change a
Beneficiary by filing a signed designation with the Committee in a
form approved by the Committee. The Participant's Will is not
effective for this purpose. If a designation has not been properly
completed and filed with the Committee or is ineffective for any
other reason, the Beneficiary shall be the Participant's Surviving
Spouse. If there is no effective designation and the Participant
does not have a Surviving Spouse, the remaining benefits, if any,
shall be distributed to the Participant's estate.
2.2
Change in Control . "Change in Control"
means:
(a)
the acquisition by any person, or more than
one person acting as a group (whether by merger, consolidation,
purchase, reorganization or similar business transaction) (a
"Person"), within the meaning of Code Section 409A and the
regulations, including any "person" within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), of beneficial ownership within the
meaning of Rule 13d-3 promulgated under the Exchange Act, of more
than 50% of either (i) the then outstanding shares of common stock
of the Company (the "Outstanding Company Common Stock") or (ii) the
total fair market value of the Company;
(b)
acquisition by any Person during the 12-month
period from and including the date of the most recent acquisition
of 30% or more of ownership of the Outstanding Company Common
Stock;
(c)
a majority of individuals who constitute the
Board (the "Incumbent Board") is replaced during any 12-month
period by directors whose appointment or election is not endorsed
by a majority of the directors prior to the date of the appointment
or election provided that an individual who was initially elected
as a director of the Company as a result of an actual or threatened
election contest, as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act, or any other
actual or threatened solicitation of proxies or consents by or on
behalf of any Person other than the Board, shall be deemed not to
have been a member of the Incumbent Board;
(d)
the acquisition (other than by way of
transfers to a related person) within the meaning of Code Section
409A, during any 12-month period ending on the date of the most
recent acquisition by any Person of assets from the Company having
a total gross fair market value at least equal to 40% of the total
gross fair market value of all the assets of the Company
immediately before the acquisition. Fair market value shall be
determined without regard to liabilities associated with the
assets.
If a Participant is
terminated as a Director prior to a Change in Control and
Participant reasonably demonstrates that such termination was at
the request of or in response to a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change
in Control (a "Third Party") who effectuates a Change in Control,
then for all purposes of this Agreement, the date of a Change of
Control shall mean the date immediately prior to the date of such
termination.
2.3
Committee . "Committee" means the Compensation
Committee of the Board of Directors or such other committee as the
Board of Directors shall designate to administer the Plan. The
Committee shall consist of at least two members of the Board, and
all of its members shall be "non-employee directors" as defined in
Rule 16b-3 under the Securities Exchange Act of 1934, as
amended.
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2.4
Common Stock . "Common Stock"
means the common stock, $1.00 par value per share, of Wolverine
World Wide, Inc.
2.5
Company . "Company" means Wolverine World
Wide, Inc., a Delaware corporation.
2.6
Director's Fee . "Director's Fee" means the
amount of income payable to a Participant in cash for service as an
Outside Director, including payments for attendance at meetings of
the Board of Directors or meetings of committees of the Board of
Directors, and any retainer fee paid to chairpersons of committees
of the Board of Directors.
2.7
Dividend Equivalent . "Dividend Equivalent"
means a number of Stock Units equal to the number of shares of
Common Stock (including fractions of a share) that have a Market
Value equal to the amount of any cash dividends that would have
been payable to a stockholder owning the number of shares of Common
Stock represented by Stock Units credited to a Participant's
Account on each dividend payment date.
2.8
Equity Retainer. "Equity Retainer" means the
amount of Stock Units contributed for a Participant by the Company
for service as an Outside Director.
2.9
Market Value . "Market Value" means the mean
of the highest and lowest sale prices of shares of Common Stock on
the New York Stock Exchange (or any successor exchange that is the
primary stock exchange for trading of Common Stock) on the
applicable date, or if the New York Stock Exchange (or any such
successor) is closed on that date, the last preceding date on which
the New York Stock Exchange (or any such successor) was open for
trading and on which shares of Common Stock were traded.
2.10
Outside Director . "Outside Director" means
any individual who serves as a member of the Board of Directors of
the Company and who is not an employee of the Company or any of its
subsidiaries; provided, that the Committee may exclude any Outside
Director from participating in the Plan at any time or from time to
time pursuant to an individual agreement or arrangement with such
Outside Director.
2.11
Participant Account . "Participant Account"
means the bookkeeping device used by the Company to measure and
determine the amounts of deferred Director's Fee income, Equity
Retainer, and Dividend Equivalents to be distributed to a
Participant under the Plan.
2.12
Participant . "Participant" means any
individual who is participating in the Plan.
2.13
Plan Year . "Plan Year" means the 12-month
period beginning each January 1, except that the Plan Year for the
year in which the Plan becomes effective shall commence on the
effective date of the Plan and end on December 31 of such year.
2.14
Spouse . "Spouse" means the husband or wife to
whom the Participant is married on the date the benefit is
scheduled to be distributed, or distribution is scheduled to begin.
The legal existence of the spousal relationship shall be governed
by the law of the state or other jurisdiction of domicile of the
Participant.
2.15
Stock Unit . "Stock Unit" means the device
used by the Company to measure and determine the value of benefits
to be distributed to a Participant under the Plan. One Stock Unit
represents an amount of cash equal to the Market Value of one share
of the Company's Common Stock on the applicable date.
2.16
Surviving Spouse . "Surviving Spouse" means
the Spouse of the Participant at the time of the Participant's
death who survives the Participant. If the Participant and Spouse
die under circumstances which prevent ascertainment of the order of
their deaths, it shall be presumed for the Plan that the
Participant survived the Spouse.
2.17
Termination of Service . "Termination of
Service" means the termination by a Participant of service as a
director of the Company that constitutes a "separation from
service" within the meaning of Code Section 409A for any
reason.
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ARTICLE 3
Administration
3.1
Power and Authority . The Committee shall
administer the Plan, shall have full power and authority to
interpret the provisions of the Plan, and shall have full power and
authority to supervise the administration of the Plan. All
determinations, interpretations and selections made by the
Committee regarding the Plan shall be final and conclusive. The
Committee shall hold its meetings at such times and places as it
deems advisable. Action may be taken by a written instrument signed
by a majority of the members of the Committee, and any action so
taken shall be fully as effective as if it had been taken at a
meeting duly called and held. The Committee shall make such rules
and regulations for the conduct of its business as it deems
advisable. The members of the Committee shall not be paid any
additional fees for their services.
3.2
Delegation of Powers; Employment of Advisers .
The Committee may delegate to any agent such duties and powers,
both ministerial and discretionary, as it deems appropriate except
those that may not be delegated by law or regulation. In
administering the Plan, the Committee may employ attorneys,
consultants, accountants or other persons, and the Company and the
Committee shall be entitled to rely upon the advice, opinions or
valuation of any such persons. All usual and reasonable expenses of
the Committee shall be paid by the Company.
3.3
Indemnification of Committee Members . Each
person who is or shall have been a member of the Committee or to
whom authority is or has been delegated shall be indemnified and
held harmless by the Company from and against any cost, liability
or expense imposed or incurred in connection with such person's or
the Committee's taking or failing to take any action under the
Plan. Each such person shall be justified in relying o
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