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Exhibit 10(c)
December 5, 2006
AMENDED AND RESTATED
PACCAR INC
RESTRICTED STOCK AND DEFERRED COMPENSATION
PLAN
FOR NON-EMPLOYEE DIRECTORS
1.
PURPOSE OF THE PLAN
The Company has established this Plan to provide Non-Employee
Directors with financial incentives to promote the success of the
Company’s long-term business objectives, and to encourage
qualified persons to accept nominations as a Non-Employee
Director. The Plan is unfunded and benefits are payable in
the form of shares of PACCAR Common Stock or cash. The Plan
was last amended in September 2005.
The Company amends and restates the Plan effective as of January
1, 2005. The deferral feature of the Plan is intended to
satisfy the requirements of section 409A of the Internal Revenue
Code of 1986, as amended ("the Code"), with respect to
compensation deferred after December 31, 2004 (and subsequent
earnings thereon). The balance in the Deferred Accounts as of
December 31, 2004 (and subsequent earning thereon) shall be
governed by the distribution rules in effect on December 31,
2004.
2.
DEFINITIONS
(a) Board of Directors means the Board of Directors of PACCAR
Inc.
(b) Committee means the Nominating and Governance Committee of
the Board of Directors or any successor to such committee.
(c) Common Stock means common shares of PACCAR Inc with $1.00
par value and any class of common shares into which such common
shares hereafter may be converted.
(d) Company means PACCAR Inc, a Delaware corporation.
(e) Deferred Accounts means either the unfunded Stock Unit
Account or Income Account maintained by the Company into which a
Non-Employee Director may defer payment of his or her cash
compensation (retainer and fees) for service as a Company
director. The Company also shall establish subaccounts under
a Non-Employee Director’s Deferred Accounts in order to
separately account for the amounts in such Deferred Accounts that
are, and that are not, subject to section 409A of the Code.
(f) Fair Market Value means the closing price of the Common
Stock on NASDAQ reported for the date specified for determining
such value.
(g) Grant Date means the first business day of each
calendar year that Non-Employee Directors receive a grant of
Restricted Stock.
(h) Grantee means the Non-Employee Director receiving the
Restricted Stock or his legal representative, legatees,
distributees, alternate payees, or trustees as the case may
be.
(i) Mandatory Retirement means retirement as a Non-Employee
Director at age seventy-two (72) or at such other age as may be
specified in the bylaws for the Board of Directors in effect at the
time of a Non-Employee Director’s Termination.
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(j) Non-Employee Director means a member of the
Company’s Board of Directors who is not a current employee of
the Company.
(k) Plan means this PACCAR Inc Restricted Stock and Deferred
Compensation Plan for Non-Employee Directors as it may be amended
from time to time, or any successor plan that the Committee or
Board of Directors may adopt from time to time with respect to the
grant of Director Restricted Stock or other stock-based grants.
(l) Restricted Stock means Common Stock that may not be sold,
transferred, or otherwise disposed of by the Grantee except under
such circumstances as may be specified by the Committee.
(m) Termination means a "separation from service" within the
meaning of section 409A of the Code.
3.
PARTICIPATION
Each Non-Employee Director of the Company shall be eligible to
participate in the Plan during his tenure as a Director.
4.
GRANTS OF RESTRICTED STOCK
(a) On the first business day of each calendar year for the
duration of the Plan (the Grant Date), each person who is a
Non-Employee Director shall receive a grant of Restricted Stock in
an amount equal to the number of shares of Common Stock that the
"Base Amount" could have purchased at the Fair Market Value on such
Grant Date (rounded up to the nearest whole share). The "Base
Amount" shall be $60,000 as of January 1, 2005, and $90,000 as of
January 1, 2006. The Board of Directors, in its sole
discretion, may adjust the Base Amount for any Grant Date;
provided, that the adjusted Base Amount is established no later
than the December 31 immediately prior to the Grant Date on which
such Base Amount shall be effective.
(b) Shares of Restricted Stock shall vest in full and
become unrestricted on the third anniversary of the applicable
Grant Date subject to the provisions of Section 10. Shares of
Restricted Stock may not be sold, transferred or otherwise
disposed of by a Grantee until such shares become unrestricted in
accordance with the provisions of this Section 4(b).
(c) Each Restricted Stock grant shall be evidenced by a written
Restricted Stock Grant Agreement that shall be executed by the
Grantee and an authorized Company representative which shall
indicate the date of the Restricted Stock award, the number of
shares of Common Stock awarded, and contain such terms and
conditions as the Committee shall determine with respect to such
Restricted Stock grant consistent with the Plan.
(d) A PACCAR Non-Employee Director first elected to the Board of
Directors during a calendar year is entitled to a pro-rated grant
of Restricted Stock. The pro-rated grant of Restricted Stock
shall be calculated as follows: the number of shares of Common
Stock that the Base Amount could have purchased at the Fair Market
Value on the first business day the Non-Employee Director’s
Board service becomes effective (rounded up to the nearest whole
share) pro-rated to reflect the number of calendar quarters such
Non-Employee Director will serve on the Board of Directors during
the calendar year in which such Non-Employee Director is first
elected.
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5.
SHARES OF COMMON STOCK SUBJECT TO THE PLAN
There shall be reserved for use under the Plan (subject to the
provisions of Section 8 hereof) a total of 487,500 shares of Common
Stock, (adjusted to 731,250 shares effective with the August 2006
50% stock dividend) which shares may be authorized but unissued
shares of Common Stock, treasury shares, or issued shares of Common
Stock that shall have been reacquired by the Company.
6.
DIVIDEND, VOTING, AND OTHER SHAREHOLDER RIGHTS
Except as otherwise provided in the Plan, each Grantee shall
have all of the rights of a shareholder of the Company with respect
to all outstanding shares of Restricted Stock registered in his
name, including the right to receive dividends and other
distributions paid or made with respect to such shares and the
right to vote such shares.
7.
DEFERRAL OF COMPENSATION
In addition to the grant of Restricted Stock a Non-Employee
Director may elect, on or before December 31 of any year, to defer
payment of at least 25% of the cash compensation to be paid to the
Non-Employee Director for services as a Company director during the
following calendar year. Before the term of a new
Non-Employee Director begins, he may elect to defer payment of cash
compensation earned for the remainder of the calendar year in which
his term begins.
Each participating Non-Employee Director may elect to have all
or a portion of his cash compensation placed into one or both of
two unfunded accounts maintained by the Company (hereafter Deferred
Accounts). At the time a Non-Employee Director makes a deferral
election, such Non-Employee Director shall specify the time and
manner in which the Deferred Accounts shall be paid, using the
deferral election forms prescribed by the Committee. Payment
of the Deferred Accounts may be made (i) on account of the
Non-Employee Director’s Termination or (ii) based on a
specific date after
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