SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
WINNEBAGO INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (Set forth the amount on which the
filing fee is calculated and state how it was determined.)
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing party:
(4) Date filed:
<PAGE>
SUPPLEMENTAL INFORMATION
The Company will file a Registration Statement on Form S-8 to register the
Common Stock to be issued relating to the options granted under the 1997 Stock
Option Plan prior to any of the options becoming exercisable in February 1998.
<PAGE>
[LOGO]
WINNEBAGO
INDUSTRIES, INC.
FOREST CITY, IOWA 50436
NOTICE OF
1997
ANNUAL MEETING
OF SHAREHOLDERS
AND
PROXY STATEMENT
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 17, 1997
To the Shareholders of
WINNEBAGO INDUSTRIES, INC.
The Annual Meeting of Shareholders of Winnebago Industries, Inc. will be
held on Wednesday, December 17, 1997, at 7:30 p.m., Central Standard Time, at
Friendship Hall, Highway 69 South, Forest City, Iowa, for the following
purposes:
1. the election of ten directors;
2. to consider and vote upon a proposal to approve the Winnebago
Industries, Inc. 1997 Stock Option Plan (a copy of which is included
as Exhibit A to the accompanying Proxy Statement); and
3. the transaction of such other business as may properly come before
the meeting or any adjournment or adjournments thereof.
The Board of Directors of the Company has fixed the close of business on
October 13, 1997, as the record date for the determination of shareholders
entitled to notice of and to vote at this meeting and at any and all
adjournments thereof.
By Order of the Board of Directors
/s/ Raymond M. Beebe
RAYMOND M. BEEBE
SECRETARY
Forest City, Iowa
November 17, 1997
YOUR VOTE IS IMPORTANT
EVEN IF YOU PLAN TO ATTEND THE MEETING IN PERSON, PLEASE DATE, SIGN AND
RETURN YOUR PROXY IN THE ENCLOSED ENVELOPE. A PROMPT RESPONSE IS HELPFUL AND
YOUR COOPERATION IS APPRECIATED.
<PAGE>
WINNEBAGO INDUSTRIES, INC.
------------------
PROXY STATEMENT
------------------
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Winnebago Industries, Inc., an Iowa corporation (the
"COMPANY"), P.O. Box 152, Forest City, Iowa 50436, of proxies to be used at the
Annual Meeting of Shareholders of the Company to be held at Friendship Hall,
Highway 69 South, Forest City, Iowa on December 17, 1997, at 7:30 p.m., Central
Standard Time, and at any and all adjournments thereof. This Proxy Statement
was first mailed to shareholders on or about November 17, 1997.
Only holders of Common Stock of record at the close of business on October
13, 1997 will be entitled to vote at the Annual Meeting of Shareholders. At
such date, the Company had outstanding 25,480,827 shares of Common Stock, par
value $.50 per share "COMMON STOCK"). Each share of Common Stock entitles the
holder to one vote upon each matter to be voted upon at the meeting. A majority
of the outstanding shares of Common Stock will constitute a quorum for the
Annual Meeting of Shareholders. Election of each director requires the
affirmative vote of the holders of a majority of the shares of the Company's
Common Stock present or represented by proxy and voted at the meeting. Approval
of the proposal to approve the Company's 1997 Stock Option Plan requires the
affirmative vote of the holders of a majority of the shares of the Company's
Common Stock present or represented by proxy and voted at the meeting.
A form of proxy is enclosed for use at the meeting. If the proxy is
executed and returned, it may nevertheless be revoked at any time insofar as it
has not been exercised. A person giving the enclosed proxy may revoke it by
giving written notice to the Secretary, or by subsequently granting a
later-dated proxy. Unless revoked, the shares represented by validly executed
proxies will be voted at the meeting in accordance with the instructions
indicated thereon. Withholding authority to vote on a director nominee will in
effect count as a vote against the director nominee. If no instructions are
indicated on the proxy, it will be voted: (i) for the election of the nominees
for director named below; (ii) for the proposal to approve the Company's 1997
Stock Option Plan; and (iii) in the discretion of the named proxies upon such
other matters as may properly come before the meeting. Abstentions and broker
non-votes (i.e., shares held by a broker for its customers that are not voted
because the broker does not receive instructions from the customer or because
the broker does not have discretionary voting power with respect to the item
under consideration) will be counted as present for purposes of determining the
presence of a quorum. Abstentions and broker non-votes will have the same
effect as a vote against a director nominee, however, as to any other matter
which may properly come before the meeting (including the proposal to approve
the Company's 1997 Stock Option Plan), abstentions and broker non-votes will
not have any effect.
<PAGE>
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
At October 13, 1997, Mrs. Luise V. Hanson owned an aggregate of 10,621,906
shares (41.7 percent) of the outstanding Common Stock, owning 4,963,374 shares
(19.5 percent) of record and beneficially, and 5,658,532 shares (22.2 percent)
beneficially, as executor of the Estate of John K. Hanson. By virtue of her
stock ownership, Mrs. Hanson may be deemed to be a controlling person of the
Company. At the same date, Mary Jo Boman, daughter of Mrs. Luise V. Hanson,
owned 212,184 shares (0.8 percent) of Common Stock and her husband, Gerald E.
Boman, owned 211,185 shares (0.8 percent) of Common Stock. John V. Hanson, son
of Mrs. Luise V. Hanson, owned 530 shares of Common Stock.
The following table contains information with respect to the ownership of
Common Stock by (i) each person known to the Company who is the beneficial
owner of more than five percent of the outstanding Common Stock, (ii) each
director, (iii) each nominee for election as a director, (iv) each executive
officer listed in the Summary Compensation Table and (v) the group named below.
SHARES OF COMMON STOCK
OWNED BENEFICIALLY AT PERCENT OF
NAME OCTOBER 13, 1997(1) COMMON STOCK
- --------------------------------------- ----------------------- ------------
Luise V. Hanson 10,621,906(2) 41.7
Edwin F. Barker 64,666(4) (3)
Raymond M. Beebe 61,726(4) (3)
Gerald E. Boman 423,369(2) 1.7
Jerry N. Currie 10,000(4) (3)
Fred G. Dohrmann 86,008(4) (3)
John V. Hanson 530(2) (3)
Bruce D. Hertzke 48,333(4) (3)
James P. Jaskoviak 3,666(4) (3)
Gerald C. Kitch 11,000(4) (3)
Richard C. Scott -- --
Joseph M. Shuster 11,000(4) (3)
Frederick M. Zimmerman 10,650(4) (3)
Francis L. Zrostlik 10,000(4) (3)
Directors and officers as a
group (17 persons) 762,007(2)(4) 3.0
- ------------------
(1) Includes shares held jointly with or by spouse and shares held as
custodian, beneficial ownership of which is disclaimed.
(2) The narrative above provides further information with regard to such
ownership.
(3) Less than one percent.
(4) Includes 53,666, 53,666, 10,000, 85,000, 47,333, 3,666, 10,000, 10,000,
10,000, 10,000 and 313,995 shares, respectively, which Mr. Barker, Mr.
Beebe, Mr. Currie, Mr. Dohrmann, Mr. Hertzke, Mr. Jaskoviak, Mr. Kitch,
Mr. Shuster, Mr. Zimmerman, Mr. Zrostlik and the directors and officers as
a group have the right to acquire within 60 days of October 13, 1997
through the exercise of stock options.
<PAGE>
ELECTION OF DIRECTORS
All current directors are standing for reelection. Each nominee is being
elected to serve until the next ensuing annual meeting and until a successor is
elected and qualified. The shares represented by the enclosed proxy will be
voted for the election as directors of the nominees named below if no direction
is made otherwise.
<TABLE>
<CAPTION>
YEAR FIRST
BECAME A
NAME (AGE)(1) PRINCIPAL OCCUPATION DIRECTOR
- ----------------------------- ---------------------------------------------------- -----------
<S> <C> <C>
Gerald E. Boman (62) Retired; former Senior Vice President, 1962
Winnebago Industries, Inc.
Jerry N. Currie (52) President & Chief Executive Officer of both 1996
CURRIES Company, manufacturer of steel
doors and frames for nonresidential
construction and GRAHAM Manufacturing,
manufacturer of wood doors for nonresidential
construction
Fred G. Dohrmann (65) Chairman of the Board of Directors and 1989
Chief Executive Officer, Winnebago Industries, Inc.
John V. Hanson (55) Retired; former President and Deputy 1996(2)
Chairman of the Board of Directors of
Winnebago Industries, Inc.
Bruce D. Hertzke (46) President and Chief Operating Officer, 1997
Winnebago Industries, Inc.
Gerald C. Kitch (59) Executive Vice President, Pentair, Inc., 1996
diversified manufacturer of tools, equipment
and ammunition
Richard C. Scott (63) Vice President of University Development at 1997
Baylor University, Waco, Texas
Joseph M. Shuster (65) Chairman, Teltech, national technology 1988
transfer company
Frederick M. Zimmerman (61) Professor of Manufacturing Systems 1992
Engineering at The University of St.
Thomas, St. Paul, Minnesota
Francis L. Zrostlik (63) President, Stellar Industries, Inc., manu- 1993(3)
facturer of hydraulic truck equipment;
former President of Iowa Mold Tooling
</TABLE>
- ------------------
(1) Reference is made to "Voting Securities and Principal Holders Thereof."
(2) Also served as a director from 1967 to 1979 and from 1985 to 1989.
(3) Also served as a director from 1979 to 1986.
<PAGE>
All of the foregoing have been employed in their principal occupation or
other responsible positions with the same organization for at least the last
five years or are currently retired after having served in responsible
positions with the organization indicated.
John V. Hanson and Gerald E. Boman are brothers-in-law.
Mr. Zimmerman is also a director of HEI, Inc., a designer and manufacturer
of custom microelectronics and light pens.
Discretionary authority is solicited to vote for the election of a
substitute for any of said nominees who, for any reason currently unknown,
cannot be a candidate for election.
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The Board has established Audit, Human Resources and Nominating Committees
to assist it in the discharge of its responsibilities. The principal
responsibilities of each of these committees are described below.
The members of the Audit Committee are Messrs. Zimmerman and Zrostlik.
Each year, the committee recommends to the Board the appointment of independent
public accountants to examine the books of the Company. It reviews with
representatives of the independent public accountants the auditing arrangements
and scope of the independent public accountants' examination of the books,
results of those audits, their fees and any problems identified by and
recommendations of the independent public accountants regarding internal
controls. The committee is also prepared to meet privately at any time at the
request of the independent public accountants or members of management to
review any special situation arising on any of the above subjects. The
committee met four times in fiscal 1997.
The Human Resources Committee, consisting of Messrs. Shuster, Zimmerman
and Kitch, met six times in fiscal 1997. This committee makes recommendations
to the Board of Directors as to the salary of the Chief Executive Officer (CEO)
and sets the salaries and bonus payments, if any, of all other
employee-directors and elected officers. It also has responsibility for
administration of the Officer Incentive Compensation Plan and certain other
employee incentive plans.
The members of the Nominating Committee are Messrs. Dohrmann, Hanson and
Shuster. This committee recommended to the Board the director-nominees proposed
in this Proxy Statement for election by the shareholders. It reviews the
qualifications of, and recommends to the Board, candidates to fill Board
vacancies as they may occur during the year. The Nominating Committee will
consider suggestions from all sources, including shareholders, regarding
possible candidates for director. Such suggestions, together with appropriate
biographical information, should be submitted to the Secretary of the Company.
The committee met once in fiscal 1997.
The Board of Directors of the Company held six meetings during fiscal
1997. Actions taken by any committee of the Board are reported to the Board of
Directors, usually at its next meeting. During fiscal 1997, all of the
directors attended more than 75 percent of the aggregate of Board of Directors'
meetings and meetings of committees of the Board on which they served (while
such Directors were members of the Board of Directors). Each director (except
directors who are employees of the Company) currently receives a monthly fee of
$1,600.
<PAGE>
Effective April 1, 1997, the Board of Directors adopted the Winnebago
Industries, Inc. Directors' Deferred Compensation Plan (the "DIRECTORS'
DEFERRED COMPENSATION PLAN"). The purpose of the Directors' Deferred
Compensation Plan is to enable non-employee directors (the "PARTICIPANTS") to
receive their fees and retainers as members of the Board of Directors and
committees of the Board (the "DEFERRED COMPENSATION") in a form other than as
direct payments. A Participant may elect to apply 100% of his or her Deferred
Compensation to either but not both of the following forms: "Money Credits" or
"Winnebago Stock Units." Money Credits are units credited in the form of
dollars in accordance with the Participant's election to such Participant's
account established by the Company. The Money Credits accrue interest from the
credit date. The interest rate to be applied to the Participant's Money Credits
is the 30 year Treasury bond yield as of the first business day of the plan
year. The Board of Directors may from time to time prescribe additional methods
for the accrual of interest on Money Credits with respect to Deferred
Compensation. "Winnebago Stock Units" are units credited in the form of Common
Stock of the Company in accordance with the Participant's election to such
Participant's account established by the Company. The Common Stock utilized for
purposes of the Directors' Deferred Compensation Plan will be treasury shares
of the Company. Winnebago Stock Units will be recorded in such Participant's
account on the basis of the mean between the high and the low prices of the
Common Stock of the Company on the date upon which the account is to be
credited, as officially quoted by the New York Stock Exchange. Any Participant
investing Deferred Compensation in Winnebago Stock Units will receive a
matching contribution from the Company equal to 25% of the Deferred
Compensation so invested.
A Participant's Winnebago Stock Unit account will vest at the rate of
33-1/3% for each complete 12 month period of service as a Director following
April 1, 1997. Notwithstanding the above, the Participant's Winnebago Stock
Unit account will become fully vested upon his or her attainment of age 69-1/2
while serving as a Director. In the event that a Participant terminates his or
her service as a Director, any unvested Winnebago Stock Units will be forfeited
by the Director and applied to future Company matching contributions.
In the event of any change in the outstanding shares of Common Stock of
the Company by reason of any stock dividend or split, recapitalization, merger,
consolidation, spin-off, reorganization, combination or exchange of shares or
other similar corporate change, then if the Directors' Deferred Compensation
Plan administrator determines, in its sole discretion, that such change
equitably requires an adjustment in the number of Winnebago Stock Units then
held in the Participant's Winnebago Stock Unit account, such adjustments will
be made by the Directors' Deferred Compensation Plan administrator and will be
conclusive and binding for all purposes of said plan.
In the event of a "change in the control of the Company," as defined in
the Directors' Deferred Compensation Plan, the Participant will receive a lump
sum distribution of his or her accounts within 30 days following his or her
termination of service as a Director after such change in control.
Notwithstanding the above, in no event will a Participant's receipt of a
distribution of Winnebago Stock Units from his or her accounts precede the
six-month anniversary of his or her election to convert Deferred Compensation
into Winnebago Stock Units.
The Winnebago Industries, Inc. Stock Option Plan for Outside Directors
(the "OUTSIDE DIRECTORS OPTION PLAN") provides that each director who is not a
current or former full-time employee of the Company or a subsidiary (for
purposes of the Outside Directors Option Plan, an "OUTSIDE DIRECTOR") will
receive an option to purchase 10,000 shares of Common Stock. Pursuant to the
Outside Directors
<PAGE>
Option Plan, each Outside Director as of May 7, 1992 (consisting Joseph Shuster
and two former Directors) automatically received an option to purchase 10,000
shares of Common Stock at a price of $5.50 per share. In addition, each person
who first becomes a member of the Board of Directors as an Outside Director
after May 7, 1992 will automatically receive an option to purchase 10,000
shares of Common Stock as of the date on which such person first becomes an
Outside Director. Under this provision, Frederick M. Zimmerman received an
option to purchase 10,000 shares of Common Stock on December 16, 1992 at a
price of $9.00 per share, Francis L. Zrostlik received an option to purchase
10,000 shares of Common Stock on December 15, 1993 at a price of $8.875 per
share, Jerry Currie received an option to purchase 10,000 shares of Common
Stock on December 19, 1996 at a price of $7.1875 per share, Gerald Kitch
received an option to purchase 10,000 shares of Common Stock on December 19,
1996 at a price of $7.1875 per share and Richard C. Scott received an option to
purchase 10,000 shares of Common Stock on March 20, 1997 at a price of $7.25
per share. No option is exercisable during the first year after the date such
option is granted. Thereafter, the options are exercisable for a period of ten
years from the date each such option is granted. Notwithstanding the foregoing,
in the event of a merger, consolidation, dissolution or liquidation of the
Company, the expiration dates of any outstanding options may be accelerated and
the dates on which outstanding options may be exercised may be accelerated, but
the effectiveness of such acceleration and any exercise of options pursuant
thereto with respect to shares in excess of the number of shares that could
have been exercised in the absence of such acceleration, is conditioned upon,
among other requirements, the consummation of the merger, consolidation,
dissolution or liquidation. The purchase price of options granted under the
plan is equal to 100 percent of the fair market value per share of the Common
Stock at the time the option is granted. At August 30, 1997, options for 80,000
shares were outstanding under the Outside Directors Option Plan, options for
10,000 shares have been exercised and options for 10,000 shares were available
for grant thereunder.
The 1997 Stock Option Plan provides that directors who do not hold a
position of employment with the Company or a subsidiary (for purposes of the
1997 Stock Option Plan "OUTSIDE DIRECTORS") shall receive nonqualified stock
options and may not be granted incentive stock options. The exercise price per
share of options granted on Outside Directors shall be the mean between the
high and low prices for a share of the Company's Common Stock on the New York
Stock Exchange on the date of grant. Each Outside Director of the Company on
the effective date of the 1997 Stock Option Plan who was not granted an option
to purchase 10,000 shares under the Outside Directors Option Plan was
automatically granted nonqualified options to purchase 10,000 shares. Each
Outside Director who, after the effective date of the 1997 Stock Option Plan is
elected or appointed to the Board of Directors for the first time and who is
not granted an option to purchase 10,000 shares under the Outside Directors
Option Plan will, at the time such Director is so elected or appointed and duly
qualified, be granted automatically a nonqualified stock option to purchase
10,000 shares at a per share price equal to the fair market value of a share on
the date of grant.
On August 14, 1997, pursuant to the terms of the 1997 Stock Option Plan,
each of Gerald E. Boman and John V. Hanson were granted subject to shareholder
approval, nonqualified stock options for 10,000 shares at a price of $8.5625
per share (which was the mean between the high and low prices for a share of
the Company's Common Stock on the New York Stock Exchange on August 14, 1997).
The nonqualified stock options granted on Messrs. Boman and Hanson are
exercisable on or after February 14, 1998.
<PAGE>
EXECUTIVE COMPENSATION
The following table contains certain information with respect to
compensation for services in all capacities paid by the Company and its
subsidiaries for the past three fiscal years, to or on behalf of (i) the Chief
Executive Officer of the Company at August 30, 1997, and (ii) each of the four
other most highly compensated executive officers of the Company serving at
August 30, 1997.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION(1) LONG-TERM COMPENSATION
----------------------------- -----------------------------------
ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($)(2) OPTIONS(3) COMPENSATION ($)(4)
- ----------------------------- ------ ------------ -------------- ------------ --------------------
<S> <C> <C> <C> <C> <C>
Fred G. Dohrmann 1997 260,000 641,600 24,000 16,817
Chairman and 1996 219,618 352,169 -- 16,760
Chief Executive Officer 1995 206,731 53,409 -- 16,702
Bruce D. Hertzke 1997 210,000 123,600 20,000 18,000
President and Chief 1996 168,846 276,900 -- 18,000
Operating Officer 1995 139,808 35,034 -- 3,960
Edwin F. Barker 1997 140,000 82,400 16,000 15,064
Vice President, Chief 1996 142,692 188,754 -- 15,064
Financial Officer 1995 136,731 35,034 -- 15,064
Raymond M. Beebe 1997 140,000 82,400 16,000 18,830
Vice President, General 1996 142,692 173,754 -- 18,830
Counsel and Secretary 1995 136,731 35,034 -- 18,830
James P. Jaskoviak 1997 140,000 82,400 16,000 12,516
Vice President, Sales 1996 142,692 173,754 -- 11,000
and Marketing 1995 136,731 35,034 -- 1,484
</TABLE>
- ------------------
(1) No executive officer received personal benefits in excess of the lesser of
10% of cash compensation or $50,000.
(2) The bonus amounts include bonuses paid pursuant to the Company's Officer
Incentive Compensation Plan as well as bonuses paid in the discretion of
the Board of Directors, all as described under the caption "Report of the
Human Resources Committee on Executive Compensation." The bonus amounts
for 1996 include discretionary bonuses paid in fiscal 1997 based on the
performance of such officers during fiscal 1996.
(3) The numbers in the table above represent options for the purchase of shares
of the Company's Common Stock granted to the named persons under the
Company's 1987 Nonqualified Stock Option Plan and the Company's 1997 Stock
Option Plan. Half of the options for each named executive officer were
granted under the Company's 1987 Nonqualified Stock Option Plan and the
other half were granted under the Company's 1997 Stock Option Plan.
(4) Amounts of All Other Compensation are premiums paid by the Company pursuant
to the Company's Executive Split-Dollar Life Insurance Plan. The Plan
provides for preretirement death benefits for the named executives and
certain other executive officers and annual or a lump sum payment upon
retirement at age 65.
<PAGE>
STOCK OPTIONS GRANTED IN FISCAL 1997
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL
----------------------------------------------------------------- REALIZABLE VALUE
AT ASSUMED ANNUAL
PERCENTAGE RATES OF STOCK
OF TOTAL PRICE APPRECIATION
OPTIONS FOR OPTION TERM
GRANTED TO EXERCISE -------------------
OPTIONS EMPLOYEES PRICE PER EXPIRATION
NAME GRANTED IN FISCAL 1997 SHARE($) DATE 5% ($) 10% ($)
- -------------------- -------------- --------------- --------------- ------------ -------- --------
<S> <C> <C> <C> <C> <C> <C>
Fred G. Dohrmann 12,000(1) 7.75 (4) 10/17/2006 58,488 148,220
12,000(2) 8.5625(5) 08/14/2007 64,618 163,760
----------
24,000 5.7(3)
Bruce D. Hertzke 10,000(1) 7.75 (4) 10/17/2006 48,740 123,517
10,000(2) 8.5625(5) 08/14/2007 53,848 136,467
----------
20,000 4.8(3)
Edwin F. Barker 8,000(1) 7.75 (4) 10/17/2006 38,992 98,814
8,000(2) 8.5625(5) 08/14/2007 43,078 109,174
----------
16,000 3.8(3)
Raymond M. Beebe 8,000(1) 7.75 (4) 10/17/2006 38,992 98,814
8,000(2) 8.5625(5) 08/14/2007 43,078 109,174
----------
16,000 3.8(3)
James P. Jaskoviak 8,000(1) 7.75 (4) 10/17/2006 38,992 98,814
8,000(2) 8.5625(5) 08/14/2007 43,078 109,174
----------
16,000 3.8(3)
</TABLE>
- ------------------
(1) Stock options granted on October 17, 1996 under the Company's 1987
Nonqualified Stock Option Plan. One-third of the options become
exercisable on or after October 17, 1997, an additional one-third on or
after October 17, 1998, and the final one-third on or after October 17,
1999.
(2) Stock options granted on August 14, 1997 under the Company's 1997 Stock
Option Plan. One-third of the options become exercisable on or after
August 14, 1998, an additional one-third on or after August 14, 1999, and
the final one-third on or after August 14, 2000.
(3) Based on total grants during fiscal 1997 of 419,000 shares.
(4) The exercise price per share represents the mean between the high and low
prices for a share of the Company's Common Stock on the New York Stock
Exchange on October 17, 1996.
(5) The exercise price per share represents the mean between the high and low
prices for a share of the Company's Common Stock on the New York Stock
Exchange on August 14, 1997.
<PAGE>
AGGREGATED FISCAL YEAR-END OPTION VALUES
The following table provides information related to the number and value
of options held at August 30, 1997 by the named executive officers. Since no
options were exercised by the above-named executives in fiscal 1997, no shares
were acquired or value realized upon the exercise of options by such persons in
the last fiscal year.
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED,
OPTIONS HELD AT IN-THE-MONEY OPTIONS AT
AUGUST 30, 1997 AUGUST 30, 1997*
------------------------------- ------------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------------- ------------- --------------- ------------- --------------
<S> <C> <C> <C> <C>
Fred G. Dohrmann ......... 81,000 24,000 $213,750 $7,500
Bruce D. Hertzke ......... 44,000 20,000 124,375 6,250
Edwin F. Barker ......... 51,000 16,000 152,813 5,000
Raymond M. Beebe ......... 51,000 16,000 152,813 5,000
James P. Jaskoviak ...... 1,000 16,000 2,688 5,000
</TABLE>
- ------------------
*Represents the difference between the aggregate exercise price and $8.375 (the
closing price of the Company's Common Stock on August 29, 1997 (August 30, 1997
being a non-business day))
PENSION PLANS
The Company does not provide pension benefits for its employees, including
executive officers.
REPORT OF THE HUMAN RESOURCES COMMITTEE ON EXECUTIVE COMPENSATION
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE COMPANY'S
PREVIOUS OR FUTURE FILINGS UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES
EXCHANGE ACT OF 1934 THAT MIGHT INCORPORATE THIS PROXY STATEMENT, IN WHOLE OR
IN PART, THE FOLLOWING REPORT AND THE PERFORMANCE GRAPH WHICH FOLLOWS SHALL NOT
BE DEEMED TO BE INCORPORATED BY REFERENCE INTO ANY SUCH FILINGS.
The Human Resources Committee of the Board is the compensation committee
of the Company. This Committee reviews and approves compensation plans for all
corporate officers, including salaries, profit sharing awards and stock option
grants.
In designing its compensation programs, the Company follows its belief
that compensation should reflect the value created for shareholders while
furthering the Company's strategic goals. In doing so, the compensation
programs reflect the following goals:
* Align the interests of management with those of shareholders;
* Provide fair and competitive compensation;
* Integrate compensation with the Company's business plans;
* Reward both business and individual performance; and
* Attract and retain key executives critical to the success of the Company.
The Company's executive compensation is primarily based on three
components, each of which is intended to help achieve the overall compensation
philosophy; these are base salary, quarterly incentive awards and long-term
incentives.
<PAGE>
Base salary levels for the Company's executive officers are set by the
Committee and approved by the Board of Directors. In determining base salary
levels and annual salary adjustments for executive officers, including the
Chief Executive Officer (CEO), the Committee considers market compensation
levels in its peer group in the recreation vehicle industry as well as
individual performance and contributions.
The base salary of the CEO was $260,000 in fiscal 1997 and $219,618 in
fiscal 1996. The CEO participates in the quarterly incentive award program for
officers and other key management personnel described below. The Committee has
not found it practicable to, and has not attempted to, assign relative weights
to the specific factors considered in determining the CEO's compensation.
The Company's officers (including the CEO) and other key management
personnel are eligible for quarterly incentive awards. These awards are based
upon the Company's attainment of a predetermined profit goal for each fiscal
quarter. The profit goals are recommended by management and approved by the
Board of Directors each year at the beginning of the fiscal year. The Committee
believes that this program provides an excellent link between the value created
for shareholders and the incentives paid to the participants. Incentive award
levels are established for each class of participant and are correlated to the
profit goal. The profit goal, for purposes of this plan, is based upon certain
specified operations of the Company less the combined expenses, deductions, and
credits of the Company attributable to such operations. In computing the
incentive compensation profit, no deduction shall be taken or allowance made
for federal or state income taxes, or any expenses associated with retirement
plans or incentive compensation plans. Incentive awards are determined in
proportion to the actual operating profit achieved for each quarter in relation
to the profit goal that was set. If the operating profit achieved is less than
80 percent of the goal set, no bonus is paid and the maximum bonus paid is paid
at 120 percent of the profit goal. The maximum bonus payable under this plan
during fiscal 1997 was 70 percent and during fiscal 1996, it was 70 percent of
an officer's base salary.
Aggregate incentive awards under the plan in fiscal 1997 were 15 percent
of base salary for the officers participating in the program. The CEO received
$41,600 and $152,169 in fiscal 1997 and 1996, respectively, pursuant to this
program. In addition, the CEO was awarded discretionary bonuses of $600,000 and
$200,000 in fiscal 1997 and 1996, respectively, based on the Committee's
positive assessment of his performance and contributions as CEO.
Long-term incentives, provided through grants of stock options to the
named executives and others, are intended to retain and motivate executives to
seek to improve long-term stock market performance. Stock options are granted
at the prevailing market price and will only have value if the Company's stock
price increases. No option is exercisable during the first year after the date
such option is granted. Thereafter, options are exercisable during the period
thereof at such time or times and in such amount or amounts as determined by
the Committee. No option may be exercised more than ten years from the date of
its grant. Executives must be employed by the Company at the time of vesting in
order to exercise options. During fiscal 1997, the Committee awarded the CEO
stock options for 12,000 shares of the Company's Common Stock under the 1987
Nonqualified Stock Option Plan and stock options for 12,000 shares of the
Company's Common Stock under the 1997 Stock Option Plan. There were no stock
options awarded during fiscal 1996.
<PAGE>
Since all options are granted at the current market price, the value of an
option bears a direct relationship to the Company's stock price and is an
effective incentive for executives to create value for shareholders. The
Committee, therefore, views stock options as an important component of its
long-term performance-based compensation philosophy, but does not believe that
granting options every year is necessary to achieve such goals.
No member of the Human Resources Committee is a current or former officer
or employee of the Company or any of its subsidiaries.
Joseph M. Shuster Frederick M. Zimmerman Gerald C. Kitch
Members of the Human Resources Committee
of the Board of Directors
<PAGE>
PERFORMANCE GRAPH
The following graph compares the five-year cumulative total shareholder
return (including reinvestment of dividends) of the Company with the cumulative
total return on the Standard & Poor's 500 Index and a peer group1 of companies
over the period indicated. It is assumed in the graph that $100 was invested in
the Company's Common Stock, in the stock of the companies in the Standard &
Poor's 500 Index and in the stocks of the peer group companies on August 28,
1992 and that all dividends received within a quarter were reinvested in that
quarter. In accordance with the guidelines of the SEC, the shareholder return
for each entity in the peer group index have been weighted on the basis of
market capitalization as of each annual measurement date set forth in the
graph.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
[GRAPHIC OMITTED]
<TABLE>
<CAPTION>
8/28/92 8/27/93 8/26/94 8/25/95 8/30/96 8/29/97
---------- ---------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Winnebago Industries Inc. $ 100.00 $ 166.70 $ 195.20 $ 164.70 $ 165.40 $175.30
Peer Group(1) 100.00 154.60 175.40 146.60 213.20 237.60
S&P 500 100.00 114.10 120.80 146.90 175.30 247.10
</TABLE>
- ------------------
(1) The peer group companies are Coachmen Industries, Inc., Fleetwood
Enterprises, Inc., Thor Industries, Inc. and Winnebago Industries, Inc.
The Company selected Coachmen Industries, Inc., Fleetwood Enterprises,
Inc. and Thor Industries, Inc. on the basis of the similarity of their
business to that of the Company.
<PAGE>
CHANGE IN CONTROL ARRANGEMENTS
In June 1997, the Board of Directors adopted a plan to provide protection
to the Company's executives in the event of a change in control. If the
employment of any of the named executive officers is terminated following a
change in control, each of such officers will receive severance pay in an
amount equal to three weeks of pay for every full year of continuous service.
CERTAIN TRANSACTIONS WITH MANAGEMENT
The Company maintains normal banking relations on customary terms with
Manufacturers Bank & Trust Company, Forest City and Crystal Lake, Iowa.
Manufacturer's Bank & Trust Company is a wholly owned subsidiary of MBT Corp.
Mrs. Luise V. Hanson is a director of the Bank and MBT Corp. and owns
approximately 100 percent (37 percent of record and beneficially and 63 percent
beneficially, as executor of the Estate of John K. Hanson) of MBT Corp.'s
outstanding stock. Mr. John V. Hanson is also a director of the Bank and MBT
Corp.
PROPOSAL TO APPROVE THE WINNEBAGO INDUSTRIES, INC. 1997 STOCK OPTION PLAN
The Board of Directors has adopted and recommends that the shareholders
approve the 1997 Stock Option Plan, a copy of which is attached to this Proxy
Statement as Exhibit A. The purpose of the 1997 Stock Option Plan is to provide
additional incentives to those officers, employees, directors, advisors and
consultants of the Company whose substantial contributions are essential to the
continued growth and success of the Company's business in order to strengthen
their commitment to the Company, to motivate them to faithfully and diligently
perform their assigned responsibilities and to attract and retain competent and
dedicated individuals whose efforts will result in the long-term growth and
profitability of the Company.
The 1997 Stock Option Plan is also intended to replace the Company's Stock
Option Plan for Outside Directors, which has only options for 10,000 shares of
the Company's Common Stock available for grant thereunder and the Company's
1987 Nonqualified Stock Option Plan which expired in 1997. The Company has
continuously maintained an employee stock option plan and made periodic grants
to key employees thereunder since 1980.
In addition to incentive and nonqualified stock options, the 1997 Stock
Option Plan will make it possible to grant awards of stock appreciation rights
(either freestanding or in tandem with stock options). Payment of stock
appreciation rights may be made in the form of shares or cash, or a combination
thereof, as determined by a committee composed of two or more directors who are
non-employee directors (the "COMMITTEE"); provided that in the event a stock
appreciation right is exercised within 60 days following a change in control,
any amount payable shall be solely in cash.
The 1997 Stock Option Plan will be administered by the Board. or if the
Board so determines, by the Committee, which may make awards encompassing a
total of not more than 2,000,000 shares of the Company's common stock,
representing approximately 7.8% of the outstanding shares of common stock of
the Company at October 13, 1997. Such shares will be treasury shares or
authorized and unissued shares. If shares are not issued when an award is
exercised or paid because, for example, the exercise price of an option is paid
for by having shares withheld, or if an option lapses or expires
<PAGE>
or is forfeited, terminated or canceled unexercised as to any shares, or if a
stock appreciation right is made in the form of cash, then such shares will
again be available for the purpose of new awards under the 1997 Stock Option
Plan. In the event of any change in the outstanding Common Stock of the Company
by reason of a stock dividend, stock split, recapitalization, merger,
consolidation, combination, or exchange of shares or other similar corporate
change, the Committee in its sole discretion shall make such adjustments as it
deems appropriate in the aggregate number and kind of shares of Common Stock
issuable under the 1997 Stock Option Plan, in the number and kind of shares of
Common Stock covered by awards made under the 1997 Stock Option Plan, and in
the exercise price of outstanding options, and such determination shall be
conclusive.
Subject to stockholder approval, the 1997 Stock Option Plan will be
effective as of August 14, 1997. No awards may be made under the 1997 Stock
Option Plan on or after August 13, 2007.
In the event that the person to whom an option or stock appreciation right
(or both) is granted (the "PARTICIPANT") ceases to be employed by the Company
or any subsidiary, any outstanding options held by such Participant shall,
unless the 1997 Stock Option Plan or the agreement evidencing such option
provides otherwise, terminate as follows: (a) If the Participant's termination
of employment is due to his death, disability, or retirement, the option shall
become vested in full and immediately exercisable for a period of three years
following such termination of employment, and shall thereafter terminate; and
(b) If the Participant's termination of employment is for any other reason
(including a Participant's ceasing to be employed by a subsidiary as a result
of the sale of such subsidiary or an interest in such subsidiary), the option
(to the extent that such option is vested at the time of the Participant's
termination of employment) shall be exercisable for a period of 90 days
following such termination of employment, and shall thereafter terminate.
Notwithstanding the foregoing, the Committee may provide, either at the time an
option is granted or thereafter, that the option may be exercised after the
periods provided above, but in no event beyond the term of the option.
Unless the Agreement evidencing such option specifies otherwise, the
Committee may cancel and rescind any unexpired, unpaid, unexercised, or
deferred options (whether vested or unvested) at any time before the exercise
thereof, if the Participant is not in compliance with any duty not to compete
or not to disclose confidential Company information.
The exercise price of options or the manner in which the exercise price is
to be determined for shares under each option shall be set forth in the
agreement relating to the grant of such options, PROVIDED, HOWEVER, that the
exercise price per share under (a) each nonqualified stock option shall not be
less than 85% of the mean between the high and low prices for a share of the
Company's Common Stock on the New York Stock Exchange at the time the option is
granted, (b) each incentive stock option shall not be less than 100% of the
mean between the high and low prices for a share of the Company's Common Stock
on the New York Stock Exchange at the time the option is granted, and (c) each
incentive stock option granted to a ten-percent shareholder shall not be less
than 110% of the mean between the high and low prices for a share of the
Company's Common Stock on the New York Stock Exchange at the time the option is
granted.
Options granted under the 1997 Stock Option Plan shall be for such term as
the Committee shall determine, PROVIDED, HOWEVER, that no option shall be
exercisable after the expiration of 10 years from the date it is granted, or
five years in the case of an incentive stock option granted to a ten-percent
shareholder. The Committee may, subsequent to the granting of any option,
extend the term thereof but in no event shall the term as so extended exceed
the maximum term provided for in the preceding sentence.
<PAGE>
No option granted under the 1997 Stock Option Plan shall be transferable
by the Participant otherwise than (a) by gift to an immediate family member or
members, (b) by gift to a partnership or limited liability company consisting
only of immediate family members, (c) by gift to a trust solely for the benefit
of the Participant and/or immediate family members (collectively, an
"assignee"), or (d) by will or the laws of descent and distribution; PROVIDED
HOWEVER, an incentive stock option shall only be transferable by will or the
laws of descent or distribution. An option may be exercised during the lifetime
of such Participant only by the Participant, the Participant's assignee, or
such Participant's guardian or legal representative. The terms of such option
shall be binding upon the beneficiaries, executors, administrators, heirs,
assignees and successors of the Participant.
Except in the case of a change in control, unless otherwise set forth in
the agreement relating to the grant of such options, each option shall become
exercisable upon the earlier of (a) as to all of the shares covered by the
option on the death, retirement, or disability of the Participant, or (b) six
months after the date the option was granted. To the extent not exercised,
installments shall accumulate and be exercisable, in whole or in part, at any
time after becoming exercisable, but not later than the date the option
expires. The Committee may accelerate the exercisability of any option or
portion thereof at any time.
Notwithstanding the provisions described in the preceding paragraph, each
option granted to a Participant shall become vested in full and immediately
exercisable upon the occurrence of a change in control.
The federal income tax consequences of the issuance and exercise of
options under the 1997 Stock Option Plan depend on the nature of the options
granted. For purposes of this discussion it is being assumed that (i) the
options described above (other than the incentive stock options) are not
described in Section 422 of the Internal Revenue Code of 1986, as amended
(i.e., a "nonqualified option"), (ii) the incentive stock options described
above qualify under Section 422, and (iii) none of the options described above
has a readily ascertainable fair market value within the meaning of applicable
Treasury Regulations.
Under the applicable provisions of the Internal Revenue Code, no federal
income tax will be payable by the Participant receiving a nonqualified option
at the time of grant. When the Participant exercises a nonqualified option, the
Participant will recognize as ordinary income for federal tax purposes the
excess of the fair market value of the shares with respect to which the option
is exercised over the total option price of those shares. The Company will
generally be entitled to deduct that amount from its federal taxable income for
the taxable year in which the option is exercised. Any subsequent profit or
loss realized by the Participant on the sale or exchange of any shares actually
received (measured by the difference between the amount realized on the sale or
exchange of the shares and their fair market value on the date the option was
exercised) will be treated as a capital gain or loss if the shares were held as
a capital asset.
With respect to an incentive stock option, no federal income tax will be
payable by the Participant upon the receipt of the option. In general, no
taxable gain or loss will be recognized when an incentive stock option is
exercised so long as (i) the shares received upon the exercise of the option
are neither disposed of within two years from the date of the granting of the
option nor disposed of within one year after the transfer of the shares to the
Participant ("required holding periods"), and (ii) at all times during the
period beginning on the date of the granting of the option and ending on the
day three months before the date of such exercise, the Participant has
satisfied certain employment conditions.
<PAGE>
Nonetheless, the excess of the fair market value of the shares with respect to
which the option is exercised over the total option price of those shares will
be a specific item of tax preference for the Participant for purposes of the
federal alternative minimum income tax. Provided that the foregoing conditions
are satisfied, (i) any profit or loss realized on the sale or exchange of any
shares actually received (measured by the difference between the amount
realized on the sale or exchange of the shares and the option price for those
shares) will be treated as capital gain or loss if the shares are held as a
capital asset, and (ii) the Company will not be entitled to any deduction upon
either the granting of any incentive stock option or the exercise of an
incentive stock option.
If a Participant does not satisfy the conditions described in clauses (i)
and (ii) of the preceding paragraph, the Participant will be taxed upon the
exercise of an incentive stock option in the same manner as it would have been
taxed had the option been a nonqualified stock option, as described in the
second preceding paragraph. If the Participant does not hold the stock for both
of the required holding periods described in clause (i) of the preceding
paragraph, the Participant will generally recognize taxable income for the year
in which the disposition occurred as follows: (i) compensation (ordinary)
income if and to the extent that (a) the lesser of the amount realized on
disposition, if any, of the shares or the fair market value of the shares at
the time the option was exercised exceeds (b) the option price for those
shares; (ii) capital gain if and to the extent that the amount realized on
disposition exceeds the fair market value of the share at the time the option
was exercised; and (iii) capital loss if and to the extent that the amount
realized on disposition is less than the option price. The Company will
generally be allowed a deduction to the extent that a Participant recognizes
compensation income (described in clause (i) of the preceding sentence) for the
year in which the disposition occurs.
The Committee may grant stock appreciation rights at any time it
determines, and has complete discretion in determining the number of stock
appreciation rights to be granted to each Participant and in determining the
terms and conditions pertaining to the stock appreciation rights, subject to
the provisions of the 1997 Stock Option Plan.
Under the 1997 Stock Option Plan, upon a change in control of the Company,
stock appreciation rights shall become immediately exercisable.
The 1997 Stock Option Plan provides that directors who do not hold a
position of employment with the Company or a subsidiary ("OUTSIDE DIRECTORS")
shall receive nonqualified stock options and may not be granted incentive stock
options. The exercise price per share of options granted to Outside Directors
shall be the fair market value (as previously defined) of a share on the date
of grant. Each Outside Director of the Company on the effective date of the
1997 Stock Option Plan who was not granted an option to purchase 10,000 shares
under the Outside Directors Option Plan was automatically granted nonqualified
options to purchase 10,000 shares. Each Outside Director who, after the
effective date of the 1997 Stock Option Plan is elected or appointed to the
Board of Directors for the first time and who is not granted an option to
purchase 10,000 shares under the Outside Directors Option Plan will, at the
time such Director is so elected or appointed and duly qualified, be granted
automatically, without action by the Committee, a nonqualified stock option to
purchase 10,000 shares at a per share price equal to the mean between the high
and low prices for a share of the Company's Common Stock on the New York Stock
Exchange on the date of grant.
The Board of Directors of the Company may amend or terminate the 1997
Stock Option Plan in whole or in part at any time, subject to any requirement
of shareholder approval imposed by any applicable law, rule or regulation. No
amendment, modification or termination of the 1997 Stock Option
<PAGE>
Plan shall adversely affect in any material way any award previously granted
under the plan, without the written consent of the Participant.
On August 14, 1997, the Board of Directors approved granting incentive
options for shares of the Company's Common Stock pursuant to the 1997 Stock
Option Plan, subject to shareholder approval of the 1997 Stock Option Plan, at
a price of $8.5625 per share (which was the mean between the high and low
prices for a share of the Company's Common Stock on the New York Stock Exchange
on August 14, 1997) as follows: (l) incentive options for 12,000 shares to Mr.
Dohrmann (Chairman of the Board and Chief Executive Officer), incentive options
for 10,000 shares to Mr. Hertzke (President and Chief Operating Officer),
incentive options for 8,000 shares to Mr. Barker (Vice President, Chief
Financial Officer), incentive options for 8,000 shares to Mr. Beebe (Vice
President, General Counsel and Secretary), incentive options for 8,000 shares
to Mr. Jaskoviak (Vice President - Sales and Marketing); (2) incentive options
for 72,000 shares to all current executive officers as a group (including the
named executive officers) and (3) incentive options for 161,000 shares to all
employees, including all current officers who are not executive officers, as a
group. The incentive options described above shall, subject to shareholder
approval of the 1997 Stock Option Plan, become exercisable as follows:
one-third on or after August 14, 1998, an additional one-third on or after
August 14, 1999 and the final one-third on or after August 14, 2000. Also, on
August 14, 1997, pursuant to the terms of the 1997 Stock Option Plan, each of
Gerald E. Boman and John V. Hanson, both of whom are Outside Directors under
the 1997 Stock Option Plan were granted, subject to shareholder approval,
nonqualified stock options for 10,000 shares at a price of $8.5625 per share
(which was the mean between the high and low prices for a share of the
Company's Common Stock on the New York Stock Exchange on August 14, 1997). The
nonqualified stock options granted to Messrs. Boman and Hanson are exercisable
on or after February 14, 1998. No other grants of options or stock appreciation
rights have been granted under the 1997 Stock Option Plan as of the date of
this Proxy Statement.
Except as described in the preceding paragraph, it is not possible to
determine the amount and type of awards that will be made under the 1997 Stock
Option Plan, because such determinations are within the discretion of the Board
of Directors, based on factors as they deem pertinent in selecting Participants
under the 1997 Stock Option Plan and establishing awards.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors and persons who own more than ten percent of
the Company's common stock (collectively "Reporting Persons") to file reports
of ownership and changes in ownership with the Securities and Exchange
Commission (the "SEC") and the New York Stock Exchange. Reporting Persons are
required by the SEC regulations to furnish the Company with copies of all
Section 16(a) forms they file. Based solely on its review of the copies of such
forms received or written representations from certain Reporting Persons that
no Forms 5 were required for those persons, the Company believes that, during
fiscal year 1997, all the Reporting Persons complied with all applicable filing
requirements. Mr. Gerald E. Boman, a director of the Company, inadvertently
omitted to file a Form 5 for fiscal 1996 reporting an aggregate of eight gifts
of Common Stock by Mr. Boman and his wife.
<PAGE>
SHAREHOLDER PROPOSALS
Proposals of shareholders to be included in the Company's Proxy Statement
for the January 1999 Annual Meeting of Shareholders must be received by the
Company at its executive offices no later than July 21, 1998.
GENERAL
Deloitte & Touche LLP has been selected as the Company's accountants for
the current fiscal year upon the recommendation of the Audit Committee.
Deloitte & Touche LLP have been the Company's accountants for 12 years.
Representatives of that firm are expected to be present at the Annual Meeting
with the opportunity to make a statement if they desire to do so and to be
available to respond to appropriate questions.
The cost of this proxy solicitation will be borne by the Company.
Solicitation will be made primarily through the use of the mail, but officers,
directors or regular employees of the Company may solicit proxies personally or
by telephone or telegraph without additional remuneration for such activity. In
addition, the Company will reimburse brokerage houses and other custodians,
nominees or fiduciaries for their reasonable expenses in forwarding proxies and
proxy material to the beneficial owners of such shares.
A copy of the Company's Annual Report for the fiscal year ended August 30,
1997, which includes audited financial statements, has previously been mailed
to you. The financial statements contained therein are not deemed material to
the exercise of prudent judgment in regard to any matter to be acted upon at
the Annual Meeting and, therefore, such financial statements are not
incorporated in this Proxy Statement by reference.
As of the date of the Proxy Statement, management knows of no other
matters to be brought before the Annual Meeting. However, if any other matters
should properly come before the meeting, it is the intention of the persons
named in the enclosed proxy to vote thereon in accordance with their best
judgment.
By Order of the Board of Directors
/s/ Raymond M. Beebe
RAYMOND M. BEEBE
SECRETARY
November 17, 1997
<PAGE>
EXHIBIT A
STOCK OPTION PLAN
THIS Stock Option Plan ("PLAN"), effective as of the date of its approval
by the Board of Directors, the 14th day of August, 1997, is hereby adopted and
established by Winnebago Industries, Inc., an Iowa corporation, ("COMPANY") and
will be maintained by the Company for the purpose of providing stock options
for selected management, key employees, directors, advisors and consultants as
provided herein.
ARTICLE 1 -- PURPOSE
The purpose of the Plan is to provide additional incentive to those
officers, employees, directors, advisors and consultants of the Company whose
substantial contributions are essential to the continued growth and success of
the Company's business in order to strengthen their commitment to the Company,
to motivate them to faithfully and diligently perform their assigned
responsibilities and to attract and retain competent and dedicated individuals
whose efforts will result in the long-term growth and profitability of the
Company. To accomplish such purposes, the Plan provides that the Company may
grant Incentive Stock Options, Nonqualified Stock Options and Stock
Appreciation Rights. The provisions of the Plan are intended to satisfy the
requirements of Section 16(b) of the Exchange Act, and the regulations
promulgated thereunder.
ARTICLE 2 -- DEFINITIONS
For purposes of this Plan:
2.1 "ADVISOR" or "CONSULTANT" means an advisor or consultant who is an
independent contractor with respect to the Company or a Subsidiary, and who
provides bona fide services (other than in connection with the offer or sale of
securities in a capital raising transaction) to the executive officers or Board
of Directors regarding major functions, portions or operations of the Company's
business; who is not an employee, officer, director or holder of more than ten
percent (10%) of the outstanding voting securities of the Company; and whose
services the Committee determines is of vital importance to the overall success
of the Company.
2.2 "AGREEMENT" means the written agreement evidencing the grant of an
Award and setting forth the terms and conditions thereof.
2.3 "AWARD" means, individually or collectively, a grant under this Stock
Option Plan, Stock Appreciation Rights, or both as the context requires.
2.4 "BOARD" means the Board of Directors of the Company.
2.5 "CHANGE IN CONTROL" means one of the following events:
(i) any "person" or group of persons acting in concert (as defined in
Sections 13(d) and 14(d) of the Exchange Act), other than the Hanson
Family, the Company, or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or any Subsidiary, acquires,
directly or indirectly, after the Effective Date of this Plan "beneficial
ownership" (as
<PAGE>
defined in Rule 13d-3 under the Exchange Act) of any class of securities
representing at least thirty percent (30%) of the combined voting power of
the Company;
(ii) during any period of not more than two consecutive years,
individuals who at the beginning of such period constitute the Board and
any new directors (other than any director designated by a person who has
entered into an agreement with the Company to effect a transaction
described in Subsections 2.5(i), 2.5(iii), or 2.5(iv) of this Plan), cease
for any reason to constitute a majority thereof;
(iii) the stockholders of the Company approve a merger other than (A) a
merger that would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity), in combination with the ownership of any trustee or other fiduciary
holding securities under an employee benefit plan of the Company or any
Subsidiary, at least fifty percent (50%) of the combined voting power of all
classes of stock of the Company or such surviving entity outstanding
immediately after such merger or (B) a merger effected to implement a
recapitalization of the Company (or similar transaction) in which the
shareholders of the Company immediately prior to the recapitalization (or
similar transaction) acquire at least fifty percent (50%) of the combined
voting power of the Company's then outstanding securities through the
recapitalization (or similar transaction); or
(iv) the stockholders of the Company approve a plan of complete
liquidation of the Company or a sale of all or substantially all of the
assets of the Company.
2.6 "CODE" means the Internal Revenue Code of 1986, as amended.
2.7 "COMMITTEE" means a Committee which may be appointed by the Board to
administer the Plan to perform the functions set forth herein, composed of two
or more directors who are Non-Employee Directors, as defined in paragraph
(b)(3)(i) of Rule 16b-3 under the Exchange Act. Unless and until the Board
appoints such Committee, the Board shall administer the Plan and perform the
functions set forth herein, and references herein to the Committee shall be
deemed to refer to the Board.
2.8 "COMPANY" means Winnebago Industries, Inc., an Iowa corporation, or
any successor thereto.
2.9 "DISABILITY" means the inability, due to illness or injury, to engage
in any gainful occupation for which the individual is suited by education,
training or experience, which condition continues for at least six (6) months.
2.10 "EFFECTIVE DATE OF THIS PLAN" shall be the date first written above
on which this Plan was adopted by the Board.
2.11 "ELIGIBLE EMPLOYEE" shall have the meaning given to it by Article 5.
2.12 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
2.13 "FAIR MARKET VALUE" means the fair market value of the Shares as
determined by the Committee in its sole discretion, PROVIDED, HOWEVER, that if
the Shares are then admitted to trading on a national securities exchange, the
Fair Market Value on any date shall be the mean between the high and low prices
for a share of the Company's Common Stock on the New York Stock Exchange at the
time the option is granted.
<PAGE>
2.14 "FREE-STANDING STOCK APPRECIATION RIGHT" means a Stock Appreciation
Right that is not granted in conjunction with the grant of an Option.
2.15 "HANSON FAMILY" shall mean collectively the spouse, lineal
descendent, or spouse of a lineal descendent of John K. Hanson, or any entity,
affiliate or associate controlled by the spouse, lineal descendent, or spouse
of a lineal descendent of John K. Hanson.
2.16 "IMMEDIATE FAMILY MEMBER" means a person who is the Participant's
spouse, mother, father, brother, sister, or child.
2.17 "INCENTIVE STOCK OPTION" means an Option within the meaning of
Section 422 of the Code.
2.18 "NON-EMPLOYEE DIRECTOR" means a member of the Board who is not an
employee of the Company.
2.19 "NONQUALIFIED STOCK OPTION" means an Option which is not an Incentive
Stock Option.
2.20 "OPTION" means an Incentive Stock Option, a Nonqualified Stock
Option, or either or both of them, as the context requires.
2.21 "PARTICIPANT" means a person to whom an Award has been granted under
the Plan.
2.22 "PLAN" means the Winnebago Industries, Inc. Stock Option Plan, as
amended from time to time.
2.23 "RELATED STOCK APPRECIATION RIGHT" means a Stock Appreciation Right
that is granted in conjunction with the grant of an Option.
2.24 "RETIREMENT" means termination of employment with the Company by a
Participant (other than as a result of death or Disability) if the Participant
is at least fifty-five (55) years of age.
2.25 "SECURITIES ACT" means the Securities Act of 1933, as amended.
2.26 "SHARES" means shares of Common Stock, with fifty cents ($.50) par
value per share, of the Company.
2.27 "STOCK APPRECIATION RIGHT" means the right to receive all or some
portion of the increase in the value of the Shares as provided in Article 7
hereof.
2.28 "SUBSIDIARY" means any corporation in a descending, unbroken chain of
corporations, beginning with the Company, if each of the corporations other
than the last corporation in the unbroken chain owns stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.
2.29 "TEN-PERCENT STOCKHOLDER" means an Eligible Employee, who, at the
time an Incentive Stock Option is to be granted to such Eligible Employee, owns
(within the meaning of Section 422(b)(6) of the Code) stock possessing more
than ten percent (10%) of the total combined voting power of all classes of
stock of the Company, a parent or a Subsidiary within the meaning of Sections
424(e) and 424(f), respectively, of the Code.
ARTICLE 3 -- ADMINISTRATION
3.1 The Plan shall be administered by the Board or, if the Board so
determines, by a Committee, which Committee shall at all times satisfy the
provisions of Rule 16b-3 under the Exchange Act. The
<PAGE>
Committee shall hold meetings at such times as may be necessary for the proper
administration of the Plan. The Committee shall keep minutes of its meetings. A
majority of the Committee shall constitute a quorum and a majority of a quorum
may authorize any action. Any decision reduced to writing and signed by all of
the members of the Committee shall be fully effective as if it had been made at
a meeting duly held. No member of the Committee shall be personally liable for
any action, determination or interpretation made in good faith with respect to
the Plan or Options and all members of the Committee shall be fully indemnified
by the Company with respect to any such action, determination or
interpretation. The Company shall pay all expenses incurred in the
administration of the Plan.
3.2 Subject to the express terms and conditions set forth herein, the
Committee shall have the power from time to time:
(i) to determine those Eligible Employees to whom Awards shall be
granted under the Plan and the number of Shares subject to such Awards to be
granted to each Eligible Employee and to prescribe the terms and conditions
(which need not be identical) of each Award, including the purchase price per
share of each Award, and the forfeiture provisions, if any, if the Employee
leaves the employment of the Company or a Subsidiary within a prescribed time
or acts against the interests of the Company within a prescribed time;
(ii) to construe and interpret the Plan, the Awards granted hereunder
and to establish, amend and revoke rules and regulations for the
administration of the Plan, including, but not limited to, correcting any
defect or supplying any omission, or reconciling any inconsistency in the
Plan or in any Agreement, and (subject to the provisions of Article 12 below)
to amend the terms and conditions of any outstanding Award to the extent such
terms and conditions are within the discretion of the Committee as provided
in the Plan, in the manner and to the extent it shall deem necessary or
advisable to make the Plan fully effective, and all decisions and
determinations by the Committee in the exercise of this power shall be final
and binding upon the Company or a Subsidiary, and the Participants, as the
case may be;
(iii) to determine the duration and purposes for leaves of absence which
may be granted to a Participant without constituting a termination of
employment or service for purposes of the Plan; and
(iv) generally, to exercise such powers and to perform such acts as are
deemed necessary or advisable to promote the best interests of the Company
with respect to the Plan.
3.3 Notwithstanding any other provision in this Plan, a grant of Options
to any Eligible Employee who is an officer of the Company or a Subsidiary shall
be approved by a majority vote of the Board.
ARTICLE 4 -- STOCK SUBJECT TO PLAN
4.1 The maximum number of Shares that may be issued or transferred
pursuant to Awards granted under this Plan is Two Million (2,000,000) (or the
number and kind of shares of stock or other securities that are substituted for
those Shares or to which those Shares are adjusted pursuant to Article 8), and
the Company shall reserve for the purposes of the Plan, out of its treasury
shares or its authorized but unissued Shares, such number of Shares.
4.2 Whenever any outstanding Award or portion thereof expires, is canceled
or is otherwise terminated (other than by exercise of the Award), the Shares
allocable to the unexercised portion of
<PAGE>
such Award may again be the subject of Awards hereunder, to the extent
permitted by Rule 16b-3 under the Exchange Act.
ARTICLE 5 -- ELIGIBILITY
Eligible Employees shall be the officers, employees, directors, Advisors
and Consultants of the Company who occupy responsible managerial or
professional positions and who have the capability of making a substantial
contribution to the success of the Company. In making the selection and in
determining the form and amount of Awards, the Committee shall give
consideration to the functions and responsibilities of the individual, past and
potential contributions to profitability and sound growth, the value of the
individual's services to the Company, and any other factors deemed relevant by
the Committee. The Committee shall have full and final authority on selecting
those Eligible Employees who will receive Awards.
ARTICLE 6 -- OPTIONS
The Committee may grant Options in accordance with the Plan, the terms and
conditions of which shall be set forth in an Agreement. Each Option and
Agreement shall be subject to the following conditions:
6.1 PURCHASE PRICE. The purchase price or the manner in which the purchase
price is to be determined for Shares under each Option shall be set forth in
the Agreement, PROVIDED, HOWEVER, that the purchase price per Share under (a)
each Nonqualified Stock Option shall not be less than eighty-five percent (85%)
of the Fair Market Value of a Share at the time the Option is granted, (b) each
Incentive Stock Option shall not be less than one hundred percent (100%) of the
Fair Market Value of a Share at the time the Option is granted, and (c) each
Incentive Stock Option granted to a Ten-Percent Stockholder shall not be less
than one hundred ten (110%) of the Fair Market Value of a Share at the time the
Option is granted.
6.2 DURATION. Options granted hereunder shall be for such term as the
Committee shall determine, PROVIDED, HOWEVER, that no Option shall be
exercisable after the expiration of ten (10) years from the date it is granted,
or five (5) years in the case of an Incentive Stock Option granted to a
Ten-Percent Stockholder. The Committee may, subsequent to the granting of any
Option, extend the term thereof but in no event shall the term as so extended
exceed the maximum term provided for in the preceding sentence.
6.3 NON-TRANSFERABILITY. No Option granted hereunder shall be transferable
by the Participant to whom such Option is granted otherwise than (a) by gift to
an Immediate Family Member or members, (b) by gift to a partnership or limited
liability company consisting only of Immediate Family Members, (c) by gift to a
trust solely for the benefit of the Participant and/or Immediate Family
Members, (collectively, an "assignee"), or (d) by will or the laws of descent
and distribution; PROVIDED, HOWEVER, an Incentive Stock Option shall only be
transferable by will or the laws of descent or distribution. An Option may be
exercised during the lifetime of such Participant only by the Participant, the
Participant's assignee, or such Participant's guardian or legal representative.
The terms of such Option shall be binding upon the beneficiaries, executors,
administrators, heirs, assignees and successors of the Participant.
<PAGE>
6.4 VESTING. Subject to Section 6.5, unless otherwise set forth in the
Agreement, each Option shall become exercisable upon the earlier of (a) as to
all of the Shares covered by the Option on the death, Retirement, or Disability
of the Participant, or (b) six (6) months after the date the Option was
granted. To the extent not exercised, installments shall accumulate and be
exercisable, in whole or in part, at any time after becoming exercisable, but
not later than the date the Option expires. The Committee may accelerate the
exercisability of any Option or portion thereof at any time.
6.5 ACCELERATED VESTING. Notwithstanding the provisions in Section 6.4,
each Option granted to a Participant shall become vested in full and
immediately exercisable upon the occurrence of a Change in Control.
6.6 TERMINATION OF EMPLOYMENT. In the event that a Participant ceases to
be employed by the Company or any Subsidiary, any outstanding Options held by
such Participant shall, unless this Plan or the Agreement evidencing such
Option provides otherwise, terminate as follows:
(a) If the Participant's termination of employment is due to his death,
Disability, or Retirement, the Option shall become vested in full and
immediately exercisable for a period of three (3) years following such
termination of employment, and shall thereafter terminate; and
(b) If the Participant's termination of employment is for any other
reason (including a Participant's ceasing to be employed by a Subsidiary as a
result of the sale of such Subsidiary or an interest in such Subsidiary), the
Option (to the extent that such Option is vested as provided for in Section
6.4 at the time of the Participant's termination of employment) shall be
exercisable for a period of ninety (90) days following such termination of
employment, and shall thereafter terminate.
Notwithstanding the foregoing, the Committee may provide, either at the
time an Option is granted or thereafter, that the Option may be exercised after
the periods provided for in this Section, but in no event beyond the term of
the Option.
6.7 CANCELLATION AND RECISSION OF OPTIONS. Unless the Agreement specifies
otherwise, the Committee may cancel and rescind any unexpired, unpaid,
unexercised, or deferred Options (whether vested or unvested pursuant to this
Section 6) at any time before the exercise thereof, if the Participant is not
in compliance with the following conditions:
(i) A Participant shall not render services for any organization or
engage directly or indirectly in any business which, in the judgment of the
Committee, is or becomes competitive with the Company, or which organization
or business, or the rendering of services to such organization or business,
is or becomes prejudicial to or in conflict with the interests of the
Company. For Participants whose employment has terminated, the judgment of
the Committee shall be based on the Participant's position and
responsibilities while employed by the Company or its Subsidiaries, the
Participant's post-employment responsibilities and position with the other
organization or business, the extent of past, current, and potential
competition or conflict between the Company and the other organization or
business, the effect of the Participant's assuming the postemployment
position on the Company's or its Subsidiary's customers, suppliers, and
competitors, and such other considerations as are deemed relevant given the
applicable facts and circumstances. A Participant may, however, purchase as
an investment or otherwise, stock or other securities of any organization or
business so long as such investment does not represent a greater than five
percent (5%) equity interest in the organization or business.
<PAGE>
(ii) A Participant shall not, without prior written authorization from
the Company, disclose to anyone outside the Company or Subsidiaries, or use
in other than the Company's or Subsidiary's business, any information or
materials determined to be confidential by the Committee relating to the
business of the Company or its Subsidiaries, acquired by the Participant
either during or after employment with the Company or its Subsidiaries.
6.8 METHOD OF EXERCISE. The exercise of an Option shall be made only by a
written notice delivered to the Secretary of the Company at the Company's
principal executive office, specifying the number of Shares to be purchased and
accompanied by payment therefor and otherwise in accordance with the Agreement
pursuant to which the Option was granted. The purchase price for any Shares
purchased pursuant to the exercise of an Option shall be paid in full upon such
exercise in cash, by check, or, at the discretion of the Committee and upon
such terms and conditions as the Committee shall approve, by (a) a loan made by
the Company to the Participant, (b) transferring Shares already owned to the
Company pursuant to Section 6.9, or (c) by delivery of an unconditional and
irrevocable undertaking by a broker to sell a portion of the Shares and deliver
to the Company sufficient funds to pay for the exercise price and applicable
federal, state, and local tax withholding. If requested by the Committee, the
Participant shall deliver the Agreement evidencing the Option to the Secretary
of the Company who shall endorse thereon a notation of such exercise and return
such Agreement to the Participant.
6.9 ALTERNATIVE PAYMENT METHOD. If the Committee, in its sole discretion,
determines that the Participant may pay for the purchase price of Shares
purchased pursuant to an exercise of an Option by using Shares already owned,
the Participant shall deliver a notarized statement of ownership (hereinafter,
"STATEMENT"), in a form to be determined by the Committee, to the Company
indicating that the Participant owns Shares of sufficient number and value to
cover the purchase price of the Shares purchased pursuant to the exercise of
the Option. However, no surrender of the actual stock certificates relating to
the Shares listed in the Statement is necessary. The number of Shares in the
Statement will be treated as a constructive payment of the purchase price, and
the Participant shall retain ownership of such Shares. The Company shall issue
a stock certificate for a number of Shares equal to the Shares purchased
pursuant to the Option minus the number of Shares used for the constructive
payment. All Shares listed in the Statement shall be valued at their Fair
Market Value.
6.10 RIGHTS OF PARTICIPANTS. No Participant shall be deemed for any
purpose to be the owner of any Shares subject to any Option unless and until
(a) the Option shall have been exercised pursuant to the terms thereof, (b) the
Company shall have issued and delivered the Shares to the Participant, and (c)
the Participant's name shall have been entered as a stockholder of record on
the books of the Company. Thereupon, the Participant shall have full voting,
dividend and other ownership rights with respect to such Shares.
6.11 ANNUAL LIMITATION. To the extent that the aggregate Fair Market Value
(measured at the date of grant) of Incentive Stock Options which become
exercisable for the first time by any Participant during any calendar year
exceeds one hundred thousand dollars ($ 100,000), the excess of such Options
shall be treated as Nonqualified Stock Options.
6.12 EFFECT OF EXERCISE. The exercise of any Option shall cancel that
number of Related Stock Appreciation Rights, if any, which is equal to the
number of Shares purchased pursuant to the exercised Option.
<PAGE>
ARTICLE 7 -- STOCK APPRECIATION RIGHTS
7.1 GRANT. The Committee may from time to time, and subject to such other
terms and conditions as the Committee may prescribe, grant a Free-Standing
Stock Appreciation Right or a Related Stock Appreciation Right to any Eligible
Employee. The terms and conditions of such Stock Appreciation Right shall be
set forth in the Agreement. A Related Stock Appreciation Right shall be related
on a one-for-one basis to Shares which are subject to the Option concurrently
being granted under the Plan to the grantee of such Related Stock Appreciation
Right. A Related Stock Appreciation Right shall be subject to the same terms
and conditions as the related Option, and shall only be granted at the same
time as the related Option is so granted. A Free-Standing Stock Appreciation
Right may be granted by the Committee at any time.
7.2 EXERCISE OF A RELATED STOCK APPRECIATION RIGHT. A Participant who has
been granted a Related Stock Appreciation Right may, in lieu of the exercise of
an equal number of Options, elect to exercise one or more Related Stock
Appreciation Rights and thereby become entitled to receive from the Company
payment of the amount determined pursuant to Section 7.5. Related Stock
Appreciation Rights shall be exercisable only to the same extent and subject to
the same conditions as the Option or Options related thereto are exercisable,
as provided for in Article 6. A Related Stock Appreciation Right issued in
tandem with an Incentive Stock Option may be exercised only when the Fair
Market Value of the Shares subject to the Incentive Stock Option exceeds the
exercise price of such Option. The Committee may, in its discretion, prescribe
additional conditions to the exercise of any Related Stock Appreciation Rights.
7.3 EXERCISE OF FREE-STANDING STOCK APPRECIATION RIGHTS. Free-Standing
Stock Appreciation Rights generally will be exercisable at such time or times,
and may be subject to such other terms and conditions, as shall be determined
by the Committee, in its discretion, and such terms and conditions shall be set
forth in the Agreement; PROVIDED, HOWEVER, that no Free-Standing Stock
Appreciation Right shall be exercisable after the expiration of ten (10) years
from the date it is granted. No Free-Standing Stock Appreciation Right granted
hereunder shall be transferable by the Participant to whom such right is
granted otherwise than by will or the laws of descent and distribution, and a
Free-Standing Stock Appreciation Right may be exercised during the lifetime of
such Participant only by the Participant or such Participant's guardian or
legal representative. The terms of such Free-Standing Stock Appreciation Right
shall be binding upon the beneficiaries, executors, administrators, heirs and
successors of the Participant.
7.4 CHANGE IN CONTROL. Notwithstanding any other provision in this Plan,
each Stock Appreciation Right granted to a Participant shall become immediately
exercisable in full upon the occurrence of a Change in Control.
7.5 AMOUNT PAYABLE. Upon the exercise of each Stock Appreciation Right,
the Participant shall be entitled to receive the following:
(A) If the Participant exercised a Free-Standing Stock Appreciation
Right, the amount equal to the excess of the Fair Market Value of one Share
on the exercise date over the Fair Market Value of one Share on the grant
date; and
(B) If the Participant exercised a Related Stock Appreciation Right, the
amount equal to the excess of the Fair Market Value of one Share on the
exercise date over the exercise price for one Share under the Option to which
the Stock Appreciation Right relates.
<PAGE>
7.6 EFFECT OF EXERCISE. The exercise of a Related Stock Appreciation Right
shall cancel an equal number of Shares subject to Options related thereto.
7.7 METHOD OF EXERCISE. Stock Appreciation Rights shall be exercised by a
Participant only by a written notice delivered in person or by mail to the
Secretary of the Company at the Company's principal executive office,
specifying the number of Shares with respect to which the Stock Appreciation
Right is being exercised. If requested by the Committee, the Participant shall
deliver the Agreement evidencing the Stock Appreciation Right being exercised
and with respect to a Related Stock Appreciation Right, the Agreement
evidencing any related Option to the Secretary of the Company who shall endorse
thereon a notation of such exercise and return such Agreement or Agreements to
the Participant.
7.8 FORM OF PAYMENT. Payment of the amount determined under this Article,
may be made solely in whole Shares in a number determined based upon their Fair
Market Value on the date of exercise of the Stock Appreciation Right, or
alternatively, at the sole discretion of the Committee, solely in cash, or in a
combination of cash and Shares as the Committee deems advisable. In the event
that a Stock Appreciation Right is exercised within sixty (60) days following a
Change in Control, any amount payable shall be solely in cash. If the Committee
decides to make full payment in Shares, and the amount payable results in a
fractional Share, payment for the fractional Share will be made in cash.
ARTICLE 8 -- LOANS
8.1 The Company or any Subsidiary may make loans to a Participant in
connection with the exercise of an Option, subject to the terms and conditions
in this Article and such other terms and conditions not inconsistent with the
Plan including the rate of interest, as the Committee shall impose from time to
time.
8.2 No loan made under the Plan shall exceed the sum of (a) the aggregate
purchase price payable pursuant to the Option with respect to which the loan is
made, plus (b) if applicable, the amount of the reasonably estimated income and
payroll taxes payable by the Participant with respect to the exercise of the
Option. In no event may any such loan exceed the Fair Market Value, at the date
of exercise, of the Shares received pursuant to such exercise.
8.3 No loan shall have an initial term exceeding five (5) years, PROVIDED,
HOWEVER, that loans under the Plan shall be renewable at the discretion of the
Committee, and PROVIDED, HOWEVER, that the indebtedness under each loan shall
become due and payable, as the case may be, on a date no later than (a) one (1)
year after termination of the Participant's employment due to death or
Disability, or (b) the date of termination of the Participant's employment for
any reason other than death or Disability.
8.4 Loans under the Plan may be satisfied by a Participant, as determined
by the Committee, in cash or, with the consent of the Committee, in whole or in
part by the transfer to the Company of Shares whose Fair Market Value on the
date of such payment is equal to part or all of the outstanding balance of such
loan.
8.5 A loan shall be secured by a pledge of Shares with a Fair Market Value
of not less than the principal amount of the loan. After any repayment of a
loan, pledged Shares no longer required as security may be released to the
Participant.
<PAGE>
8.6 Every loan shall meet all applicable laws, regulations and rules of
the Federal Reserve Board and shall satisfy the applicable laws and regulations
under the Code for imputed interest.
ARTICLE 9 -- ADJUSTMENT UPON CHANGES IN CAPITALIZATION
9.1 In the event of any change in the outstanding Shares of the Company by
reason of a stock dividend, stock split, recapitalization, merger,
consolidation, combination, or exchange of shares or other similar corporate
change, the Committee in its sole discretion shall make such adjustments as it
deems appropriate in the aggregate number and kind of Shares issuable under the
Plan, in the number and kind of Shares covered by Awards made under the Plan,
and in the exercise price of outstanding Options, and such determination shall
be conclusive.
9.2 Any such adjustment in the Shares or other securities subject to
outstanding Incentive Stock Options (including any adjustments in the purchase
price) shall be made in such manner as not to constitute a modification as
defined by Section 424(h)(3) of the Code and only to the extent otherwise
permitted by Sections 422 and 424 of the Code.
9.3 In the event of any liquidation, dissolution, merger, consolidation or
other reorganization (collectively, a "TRANSACTION") of the Company, the
Options and Agreements shall continue in effect in accordance with their
respective terms, except that following a Transaction each Participant shall be
entitled to receive in respect of each Share subject to an Option, as the case
may be, upon exercise of any Option, the same number and kind of stock,
securities, cash, property or other consideration that each holder of a Share
was entitled to receive in the Transaction in respect of a Share.
ARTICLE 10 -- OUTSIDE DIRECTOR OPTIONS
10.1 GENERAL. Notwithstanding any of the other provisions of the Plan to
the contrary, the provisions of this Article shall apply only to grants of
Options to directors of the Company ("Outside Directors") who do not hold a
position of employment with the Company or a Subsidiary besides his or her
position as a director of the Company. Except as set forth in this Article, the
other provisions of the Plan shall apply to grants of Options to Outside
Directors to the extent not inconsistent with this Article. Solely for purposes
of interpreting Article 6 of this Plan, an Outside Director's service as a
member of the Board shall be deemed to be employment with the Company. All
Outside Directors shall receive Nonqualified Stock Options in accordance with
this Article and the Plan, and may not be granted Incentive Stock Options under
this Plan. The purchase price per Share purchasable under Options granted to
Outside Directors shall be the Fair Market Value of a Share on the date of
grant. No Agreement with any Outside Director may alter the provisions of this
Article and no Option granted to an Outside Director may be subject to a
discretionary acceleration of exercisability.
10.2 AUTOMATIC GRANT TO CURRENT OUTSIDE DIRECTORS. Each Outside Director
of the Company on the Effective Date of this Plan who has not been granted an
option to purchase 10,000 Shares under the Company's Stock Option Plan for
Outside Directors in effect immediately prior to the Effective Date of this
Plan, will, without action by the Committee, be granted automatically a
Nonqualified Stock Option to purchase 10,000 Shares at a per share price equal
to the Fair Market Value of a Share on the date of grant.
<PAGE>
10.3 AUTOMATIC GRANT TO NEW OUTSIDE DIRECTORS. Each Outside Director who,
after the Effective Date of this Plan, is elected or appointed to the Board for
the first time and who is not granted an option to purchase 10,000 Shares under
the Company's Stock Option Plan for Outside Directors in effect immediately
prior to the Effective Date of this Plan, will, at the time such Director is so
elected or appointed and duly qualified, be granted automatically, without
action by the Committee, a Nonqualified Stock Option to purchase 10,000 Shares
at a per share price equal to the Fair Market Value of a Share on the date of
grant.
10.4 DISCRETIONARY GRANT TO OUTSIDE DIRECTORS. The Board of Directors of
the Company may, in its discretion, grant additional Nonqualified Stock Options
to Outside Directors subject to the terms and conditions of this Article 10 and
the Plan.
10.5 DECLINING AWARDS. Notwithstanding any automatic grant of an Award
under this Article, an Outside Director may elect, at any time before the Award
would otherwise be made, to decline an automatic Award under this Plan or to
revoke a previous election to decline an automatic Award. An Outside Director
who elects to decline an automatic Award under this Plan shall receive nothing
in lieu of such Award, either at the time of such election or at any time
thereafter.
10.6 DISCRETIONARY GRANT TO EMPLOYEE DIRECTORS. If a Participant is a
director and holds a position of employment with the Company or a Subsidiary
besides his or her position as a director of the Company, the Company may grant
such Participant Options under this Plan as an employee of the Company without
the restrictions of this Article.
ARTICLE 11 -- RELEASE OF FINANCIAL INFORMATION
A copy of the Company's annual report to stockholders shall be delivered
to each Participant if and at the time any such report is distributed to the
Company's stockholders. Upon request, by any Participant, the Company shall
furnish to such Participant a copy of its most recent annual report and each
quarterly report and current report filed under the Exchange Act since the end
of the Company's prior fiscal year.
ARTICLE 12 -- TERMINATION AND AMENDMENT OF THE PLAN
12.1 The Plan shall terminate on the day preceding the tenth anniversary
of its Effective Date, except with respect to Awards outstanding on such date,
and no Awards may be granted thereafter. The Board may sooner terminate or
amend the Plan at any time, and from time to time; PROVIDED, HOWEVER, that,
except as provided in Article 8 hereof, no amendment shall be effective unless
approved by the stockholders of the Company where stockholder approval of such
amendment is required (a) to comply with Rule 16b-3 under the Exchange Act, or
(b) to comply with any other law, regulation or stock exchange rule.
Notwithstanding anything in this Section to the contrary, Article 10 relating
to Options for Directors shall not be amended more than once in any six-month
period, other than to comport with changes in the Code, the Employee Retirement
Income Security Act of 1974, as amended, or the rules or regulations
thereunder.
12.2 Except as provided in Article 9 hereof, rights and obligations under
any Award granted before any amendment of the Plan shall not be adversely
altered or impaired by such amendment, except with the consent of the
Participant.
<PAGE>
ARTICLE 13 -- NON-EXCLUSIVITY OF THE PLAN
The adoption of the Plan by the Board shall not be construed as amending,
modifying or rescinding any previously approved incentive arrangement or as
creating any limitations on the power of the Board to adopt such other
incentive arrangements as it may deem desirable, including, without limitation,
the granting of stock options otherwise than under the Plan, and such
arrangements may be either applicable generally or only in specific cases.
ARTICLE 14 -- LIMITATION OF LIABILITY
As illustrative of the limitations of liability of the Company, but not
intended to be exhaustive thereof, nothing in the Plan shall be construed to:
14.1 give any employee any right to be granted an Award other than at the
sole discretion of the Committee;
14.2 give any person any rights whatsoever with respect to Shares except
as specifically provided in the Plan;
14.3 limit in any way the right of the Company or its Subsidiaries to
terminate the employment of any person at any time; or
14.4 be evidence of any agreement or understanding, expressed or implied,
that the Company, or its Subsidiaries, will employ any person in any particular
position, at any particular rate of compensation or for any particular period
of time.
ARTICLE 15 -- REGULATIONS AND OTHER APPROVALS; GOVERNING LAW
15.1 This Plan and the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the State of Iowa.
15.2 The obligation of the Company to sell or deliver Shares with respect
to Options granted under the Plan shall be subject to all applicable laws,
rules and regulations, including all applicable federal and state securities
laws, and the obtaining of all such approvals by governmental agencies as may
be deemed necessary or appropriate by the Committee.
15.3 Any provisions of the Plan inconsistent with Rule 16b-3 under the
Exchange Act shall be inoperative and shall not affect the validity of the
Plan.
15.4 Except as otherwise provided in Article 12, the Board may make such
changes as may be necessary or appropriate to comply with the rules and
regulations of any government authority or to obtain for Participants granted
Incentive Stock Options, the tax benefits under the applicable provisions of
the Code and regulations promulgated thereunder.
15.5 Each Award is subject to the requirement that, if at any time the
Committee determines, in its absolute discretion, that the listing,
registration or qualification of Shares issuable pursuant to the Plan is
required by any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the grant of an Award or
the issuance of Shares, no Awards shall be granted or
<PAGE>
payment made or Shares issued, in whole or in part, unless listing,
registration, qualification, consent or approval has been effected or obtained
free of any conditions as acceptable to the Committee.
15.6 In the event that the disposition of Shares acquired pursuant to the
Plan is not covered by a then current registration statement under the
Securities Act and is not otherwise exempt from such registration, such Shares
shall be restricted against transfer to the extent required by the Securities
Act or regulations thereunder, and the Company may place a restrictive legend
on the share certificate indicating such restrictions. Furthermore, the
Committee may require a Participant receiving Shares pursuant to the Plan, as a
condition precedent to receipt of such Shares, to represent to the Company in
writing that the Shares acquired by such Participant are acquired for
investment only and not with a view to distribution.
ARTICLE 16 -- MISCELLANEOUS
16.1 MULTIPLE AGREEMENTS. The terms of each Award may differ from, other
Awards granted under the Plan at the same time, or at any other time. The
Committee may also grant more than one Award to a given Participant during the
term of the Plan, either in addition to, or in substitution for, one or more
Awards previously granted to that Participant. The grant of multiple Awards may
be evidenced by a single Agreement or multiple Agreements, as determined by the
Committee.
16.2 WITHHOLDING OF TAXES.
(a) Whenever the Company proposes to issue or transfer Shares under the
Plan, the Company shall have the right to require the Participant to remit to
the Company prior to the issuance of any stock certificates and to deduct
from any payment of cash to the Participant an amount sufficient to satisfy
any federal, state, and local withholding tax requirements.
(b) Whenever under the Plan payments are to be made in cash, such
payments will be net of an amount sufficient to satisfy any federal, state,
and local withholding tax requirements.
(c) The Participant may satisfy, totally or in part, the obligations
pursuant to Section 16.2(a) by electing to have Shares withheld having a Fair
Market Value equal to the amount of cash required to be withheld. All
elections shall be irrevocable, and be made in writing and signed by the
Participant prior to the day of exercise.
(d) The Agreement evidencing any Incentive Stock Options granted under
this Plan shall provide that if the Participant makes a disposition, within
the meaning of Section 424(c) of the Code and regulations promulgated
thereunder, of any Share or Shares issued to such Participant pursuant to
such Participant's exercise of an Incentive Stock Option, and such
disposition occurs within the two (2) year period commencing on the day after
the date of grant of such Option or within the one (1) year period commencing
on the day after the date of transfer of the Share or Shares to the
Participant pursuant to the exercise of such Option, such Participant shall,
within ten (10) days of such disposition, notify the Company thereof and
thereafter immediately deliver to the Company any amount of federal, state or
local income taxes and other amounts that the Company informs the Participant
the Company is required to withhold.
16.3 DESIGNATION OF BENEFICIARY. Each Participant may, with the consent
of the Committee, designate a person or persons to receive in the event of such
Participant's death, any Award or any
<PAGE>
amount of Shares payable pursuant thereto, to which such Participant would then
be entitled. Such designation shall be made upon forms supplied by and
delivered to the Company and may be revoked or changed in writing. In the event
of the death of a Participant and in the absence of a beneficiary validly
designated under the Plan who is living at the time of such Participant's
death, the Company shall deliver such Options, and/or amounts payable to the
executor or administrator of the estate of the Participant, or if no such
executor or administrator has been appointed (to the knowledge of the Company),
the Company, in its discretion, may deliver such Options, and/or amounts
payable to the spouse or to any one or more dependents or relatives of the
Participant, or if no spouse, dependent or relative is known to the Company,
then to such other person as the Company may designate.
16.4 GENDER AND NUMBER. Except where otherwise indicated by the context,
any masculine term used herein also shall include the feminine; the plural
shall include the singular and the singular shall include the plural.
16.5 SEVERABILITY. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been included.
16.6 SUCCESSORS. All obligations of the Company under the Plan, with
respect to Awards granted hereunder, shall be binding on any successor to the
Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially
all of the business and/or assets of the Company.
16.7 SHAREHOLDER APPROVAL. Shareholder approval of this Plan is required
to qualify any Option as an Incentive Stock Option, and if shareholder approval
is not received within twelve (12) months after the Effective Date of this
Plan, any Awards of Incentive Stock Options shall be automatically converted
into Nonqualified Stock Options.
NOW, THEREFORE, this Plan is made effective as of the day, month and year
first above written.
WINNEBAGO INDUSTRIES, INC.
By: /s/ Fred G. Dohrmann
Fred G. Dohrmann, Chief Executive Officer
<PAGE>
WINNEBAGO INDUSTRIES, INC. * FOREST CITY, IOWA
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY
FOR ANNUAL MEETING ON DECEMBER 17, 1997
The undersigned hereby appoints Gerald E. Boman and Fred G. Dohrmann, or either
one of them, the undersigned's attorneys and proxies, with full power of
substitution, to vote all shares of Common Stock of Winnebago Industries, Inc.
which the undersigned is entitled to vote, as fully as the undersigned could do
if personally present, at the Annual Meeting of Shareholders of said
corporation to be held at Friendship Hall, Highway 69 South, Forest City, Iowa,
on the 17th day of December, 1997, at 7:30 p.m., Central Standard Time, and at
any and all adjournments thereof:
1. ELECTION OF DIRECTORS
FRED G. DOHRMANN, GERALD E. BOMAN, JERRY N. CURRIE, JOHN V. HANSON,
BRUCE D. HERTZKE, GERALD C. KITCH, RICHARD C. SCOTT, JOSEPH M. SHUSTER,
FREDERICK M. ZIMMERMAN, AND FRANCIS L. ZROSTLIK.
(Mark One)
[ ] FOR all nominees listed above [ ] WITHHOLD AUTHORITY to vote for
all nominees listed above
[ ] FOR all nominees listed above except
------------------------------
2. Approval of the Winnebago Industries, Inc. 1997 Stock Option Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(CONTINUED, AND TO BE SIGNED AND DATED, ON THE OTHER SIDE)
<PAGE>
(CONTINUED FROM THE OTHER SIDE)
3. IN THEIR DISCRETION ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE
MEETING.
This Proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED FOR THE ELECTION OF THE NOMINEES LISTED IN ITEM 1, VOTED TO APPROVE THE
1997 STOCK OPTION PLAN IN ITEM 2, AND IN THE DISCRETION OF THE PROXY HOLDERS ON
ALL OTHER MATTERS.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as administrator, attorney, executor,
guardian or trustee, please give full title as such. If a corporation,
authorized officer please sign full corporate name and indicate office held.
Dated ____________________ , 1997
_________________________________
Signature
_________________________________
Signature if held jointly or
office or title held
PLEASE DATE, SIGN, AND MAIL THIS PROXY CARD IN THE ENCLOSED ENVELOPE. NO
POSTAGE IS REQUIRED.
