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 [ ] Confidential, for Use of the
Commission Only, (as
permitted by Rule 14a-
6(e) (2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
Gehl Company
--------------------------------
(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 transaction 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>
GEHL COMPANY
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 20, 2000
To the Shareholders of Gehl Company:
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of Gehl Company
will be held on Thursday, April 20, 2000, at 3:00 P.M., local time, at the
Cedar Theatre, Cedar Lake Campus, 5595 Highway Z, West Bend, Wisconsin 53095,
for the following purposes:
1. To elect three directors to hold office until the annual meeting of
shareholders in 2003 and until their successors are duly elected and
qualified.
2. To act upon a proposal to approve the Gehl Company 2000 Equity
Incentive Plan.
3. To consider and act upon such other business as may properly come
before the meeting or any adjournment or postponement thereof.
The close of business on February 18, 2000, has been fixed as the record
date for the determination of shareholders entitled to notice of, and to vote
at, the meeting and any adjournment or postponement thereof.
A proxy for the meeting and a proxy statement are enclosed herewith.
A map showing the location of the Cedar Theatre accompanies this notice
and proxy statement.
By Order of the Board of Directors
GEHL COMPANY
Michael J. Mulcahy
Secretary
West Bend, Wisconsin
March 6, 2000
YOUR VOTE IS IMPORTANT NO MATTER HOW LARGE OR SMALL YOUR HOLDINGS MAY BE. YOU
ARE URGED TO DATE, SIGN AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED
ENVELOPE WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON. IF
YOU ATTEND THE ANNUAL MEETING AND WISH TO VOTE YOUR SHARES PERSONALLY, YOU MAY
DO SO BY REVOKING YOUR PROXY AT ANY TIME PRIOR TO THE VOTING THEREOF.
GEHL COMPANY
143 Water Street
West Bend, Wisconsin 53095
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 20, 2000
This proxy statement is being furnished to shareholders by the Board
of Directors (the "Board") of Gehl Company (the "Company") beginning on or
about March 6, 2000, in connection with a solicitation of proxies by the Board
for use at the Annual Meeting of Shareholders to be held on Thursday, April
20, 2000, at 3:00 P.M., local time, at the Cedar Theatre, Cedar Lake Campus,
5595 Highway Z, West Bend, Wisconsin 53095, and at all adjournments or
postponements thereof (the "Annual Meeting"), for the purposes set forth in
the attached Notice of Annual Meeting of Shareholders.
Execution of a proxy given in response to this solicitation will not
affect a shareholder's right to attend the Annual Meeting and to vote in
person. Presence at the Annual Meeting of a shareholder who has signed a
proxy does not in itself revoke a proxy. Any shareholder giving a proxy may
revoke it at any time before it is voted by giving notice thereof to the
Company in writing or in open meeting.
A proxy, in the enclosed form, which is properly executed, duly
returned to the Company and not revoked will be voted in accordance with the
instructions contained therein. The shares represented by executed but
unmarked proxies will be voted FOR the persons nominated for election as
directors referred to herein, FOR the approval of the Gehl Company 2000 Equity
Incentive Plan (the "2000 Plan"), and on such other business or matters which
may properly come before the Annual Meeting in accordance with the best
judgment of the persons named as proxies in the enclosed form of proxy. Other
than the election of directors and the proposal to approve the 2000 Plan, the
Board has no notice of any matters to be presented for action by the
shareholders at the Annual Meeting.
Only holders of record of the Company's Common Stock, $.10 par value
per share (the "Common Stock"), at the close of business on February 18, 2000,
are entitled to notice of and to vote at the Annual Meeting. On that date,
the Company had outstanding and entitled to vote 5,580,434 shares of Common
Stock, each of which is entitled to one vote per share.
ELECTION OF DIRECTORS
The Company's By-laws provide that the directors shall be divided
into three classes, with staggered terms of three years each. At the Annual
Meeting, the shareholders will elect three directors to hold office until the
annual meeting of shareholders in 2003 and until their successors are duly
elected and qualified. Unless shareholders otherwise specify, the shares
represented by the proxies received will be voted in favor of the election as
directors of the three persons named as nominees herein. The Board has no
reason to believe that any of the listed nominees will be unable or unwilling
to serve as a director if elected. However, in the event that any one or more
of the nominees should be unable to serve or for good cause will not serve,
the shares represented by proxies received will be voted for other nominees
selected by the Board.
Directors are elected by a plurality of the votes cast (assuming a
quorum is present). An abstention from voting will be tabulated as a vote
withheld on the election and will be included in computing the number of
shares present for purposes of determining the presence of a quorum, but will
not be considered in determining whether each of the nominees has received a
plurality of the votes cast at the Annual Meeting. A broker or nominee voting
shares registered in its name, or in the name of its nominee, which are
beneficially owned by another person and for which it has not received
instructions as to voting from the beneficial owner, has the discretion to
vote the beneficial owner's shares with respect to the election of
directors.
The following sets forth certain information, as of February 1,
2000, about each of the Board's nominees for election at the Annual Meeting
and each director of the Company whose term will continue after the Annual
Meeting.
Nominees for Election at the Annual Meeting
Terms expiring April, 2003
John T. Byrnes, 54, has served as Chairman and Chief Executive Officer of
Mason Wells, Inc. (a Milwaukee, Wisconsin-based private equity investment
firm) since May, 1998. Mr. Byrnes was President and a director of M&I Capital
Markets Group from 1985 to 1998. Mr. Byrnes has served as a director of the
Company since December, 1999. Mr. Byrnes is also a director for numerous
private companies and the Medical College of Wisconsin Research Foundation (an
organization providing guidance for technology transfers from Medical College
of Wisconsin research facilities to private industry).
Richard J. Fotsch, 44, has served as Senior Vice President and General Manager
of Briggs & Stratton Corporation (the world's largest manufacturer of air
cooled gasoline engines for the outdoor power equipment industry) since 1999.
Mr. Fotsch has served as a Senior Vice President since 1997 and has held
management positions with various divisions of Briggs & Stratton Corporation
from 1983 to 1997. Mr. Fotsch is a member of the Dean's Advisory Council for
the College of Engineering of Marquette University. Mr. Fotsch is a new
nominee for election as a director of the Company.
Dr. Hermann Viets, 57, has served as President and Chief Executive Officer of
the Milwaukee School of Engineering (a university located in Milwaukee,
Wisconsin focused primarily on engineering education) since 1991. Dr. Viets
has served as a director of the Company since April, 1999. Dr. Viets is also
a director of Astro Med, Inc. (an electronic equipment manufacturer),
Milwaukee County Research Park Corp. (an organization responsible for the
development of a high technology industrial park in western Milwaukee County)
and Competitive Wisconsin, Inc. (an association of business, education and
labor leaders promoting the State of Wisconsin) and is a member of the Greater
Milwaukee Committee (an organization of civic leaders promoting the economic
development and social improvement of the City of Milwaukee).
THE BOARD RECOMMENDS THE FOREGOING NOMINEES FOR ELECTION AS DIRECTORS AND
URGES EACH SHAREHOLDER TO VOTE "FOR" ALL NOMINEES. SHARES OF COMMON STOCK
REPRESENTED BY EXECUTED BUT UNMARKED PROXIES WILL BE VOTED "FOR" ALL NOMINEES.
Directors Continuing in Office
Terms expiring April, 2001
Fred M. Butler, 64, was President and Chief Executive Officer of The Manitowoc
Company, Inc. (a manufacturer of cranes, commercial ice cube machines and
ships) from 1990 until his retirement in 1998. Mr. Butler has served as a
director of the Company since 1995.
William D. Gehl, 53, has served as Chairman since April, 1996 and as President
and Chief Executive Officer of the Company since November, 1992. From
January, 1990 until joining the Company, Mr. Gehl was Executive Vice
President, Chief Operating Officer, General Counsel and Secretary of The
Ziegler Companies, Inc. (a financial services holding company). Mr. Gehl held
various management positions with The Ziegler Companies from 1978 to 1990. Mr.
Gehl has served as a director of the Company since 1987. Mr. Gehl is also a
director and past Chairman of the Board of the Equipment Manufacturers
Institute (a Chicago-based trade association of agricultural and construction
equipment manufacturers), a director of West Bend Savings Bank (a state
financial institution), Wisconsin Manufacturers and Commerce (a business
association promoting the improvement of the economic climate of the State of
Wisconsin), The Associated Equipment Dealers Foundation (a national foundation
promoting the education and training of equipment dealer personnel), Mason
Wells, Inc. (a Milwaukee, Wisconsin-based private equity investment firm) and
ASTEC Industries, Inc. (a manufacturer of road building related machinery).
Mr. Gehl is a member of the Florida and Wisconsin Bar Associations.
John W. Splude, 54, has served as Chairman and Chief Executive Officer of HK
Systems, Inc. (an integrator of material handling systems and a provider of
supply chain software solutions) since October, 1993. Prior to joining HK
Systems, Inc., Mr. Splude served as President of Harnischfeger Engineers,
Inc., a wholly-owned subsidiary of Harnischfeger Industries, Inc. Mr. Splude
has served as a director of the Company since 1995. Mr. Splude is also a
member of the Material Handling Institute Board of Governors (a trade
association of material handling equipment manufacturers), a director of
Advance Separation and Process Systems, Inc. (a manufacturing and software
company) and a Regent of the Milwaukee School of Engineering.
Terms expiring April, 2002
Nicholas C. Babson, 53, was Chairman of the Board and President from 1984 and
Chairman and Chief Executive Officer from 1996 of Babson Bros. Co. (a global
manufacturer and distributor of dairy equipment and consumable supplies) until
his retirement in 1999. Mr. Babson has served as a director of the Company
since April, 1999. Mr. Babson is also a director of Center Point Properties
Trust (a real estate investment trust investing in industrial real estate
primarily in the Chicago area), a trustee of the Farm Foundation (an
association of agricultural educators, economists and business leaders) and a
Regent of the University of the South.
Thomas J. Boldt, 47, has served as President of The Boldt Group, Inc. (a
holding company with subsidiaries involved in general construction, program
and construction management and real estate development) since 1988. Mr.
Boldt held various management positions with various subsidiaries of The Boldt
Group, Inc. from 1976 to 1988. Mr. Boldt has served as a director of the
Company since 1996. Mr. Boldt is also a director of M&I Bank, Fox Valley (a
national bank) and Wisconsin Manufacturers and Commerce (a business
association promoting the improvement of the economic climate of the State of
Wisconsin) and a Regent of St. Olaf College.
William P. Killian, 64, has served as Vice President, Corporate Development
and Strategy, of Johnson Controls, Inc. (a global market leader in automotive
systems and building controls) since 1987. Mr. Killian has served as a
director of the Company since 1996. Mr. Killian is also a director and
President Emeritus of the Association for Corporate Growth (a professional
organization comprised of individuals interested in corporate growth and
mergers and acquisitions), a director of Aqua-Chem, Inc. (a manufacturer of
industrial boilers and water purification equipment), Interstate Battery
Systems of America, Inc. (a distributor of automotive and industrial
batteries), Twitchell Corp. (a manufacturer of plastic coated yarn and
fabrics) and Premex, Inc. (a manufacturer of composite materials).
BOARD OF DIRECTORS
The Board has standing Audit, Compensation and Benefits, and Nominating
Committees. The Audit Committee reviews the scope, timing and results of the
audit of the Company's financial statements by the Company's independent
auditors and reviews with the independent auditors management's policies and
procedures with respect to auditing and accounting controls. The Audit
Committee also reviews and evaluates the independence of the Company's
independent auditors, approves services rendered by such auditors and
recommends to the Board the engagement, continuation or discharge of the
Company's independent auditors. Messrs. Babson, Boldt, and Splude (Chairman)
are members of the Audit Committee. The Audit Committee held two meetings in
1999.
The Compensation and Benefits Committee determines (subject to Board
approval) compensation levels for the Company's executive officers, reviews
management's recommendations as to the compensation to be paid to other key
personnel and administers the Companys equity-based incentive compensation
plans. The members of the Compensation and Benefits Committee, which held two
meetings in 1999, are Messrs. Butler (Chairman), Killian and Splude and Arthur
W. Nesbitt. Mr. Nesbitt will retire as a director at the time of the Annual
Meeting.
The functions of the Nominating Committee include recommending those
persons to be nominated by the Board for election as directors of the Company
and recommending persons to fill vacancies on the Board. The members of the
Nominating Committee, which held three meetings in 1999, are Messrs. Boldt,
Gehl, Killian, Nesbitt (Chairman) and Viets. The Nominating Committee will
consider nominees recommended by shareholders, but has no established
procedures which must be followed to make a recommendation. The Company's
By-laws set forth certain requirements for shareholders wishing to nominate
director candidates for consideration by shareholders. With respect to an
election of directors to be held at an annual meeting, a shareholder must,
among other things, give written notice of an intent to make such a nomination
to the Secretary of the Company in advance of the meeting in compliance with
the terms and within the time period specified in the By-laws.
Directors who are officers or employees of the Company receive no
compensation as such for service as members of the Board or committees
thereof. Non-employee directors receive an annual retainer fee of $10,000
($3,000 of which is payable in Common Stock), plus a fee of $1,000 for each
Board meeting and a fee of $750 ($1,000 for the committee chairman) for each
committee meeting attended.
In addition to the compensation described above, each of Messrs.
Babson, Boldt, Butler, Killian, Nesbitt, Splude and Viets automatically
received an option to purchase 2,000 shares of Common Stock at a per share
exercise price of $17.50 on April 22, 1999 in accordance with the terms of the
Gehl Company 1995 Stock Option Plan (the "1995 Plan"). Under the 1995 Plan,
each non-employee director (if he continues to serve in such capacity) will,
on the day after the annual meeting of shareholders in each year,
automatically be granted an option to purchase 2,000 shares of Common Stock.
Options granted to non-employee directors under the 1995 Plan have a per share
exercise price equal to 100% of the market value of a share of Common Stock on
the date of grant and become exercisable ratably over the three-year period
following the date of grant, except that if the non-employee director ceases
to be a director by reason of death, disability or retirement within three
years after the date of grant or in the event of a "change of control of the
Company" (as defined in the 1995 Plan) within three years after the date of
grant, the option will become immediately exercisable in full. Options
granted to non-employee directors terminate on the earlier of (a) ten years
after the date of grant or (b) twelve months after the non-employee director
ceases to be a director of the Company. In the event that the 2000 Plan is
approved by shareholders at the Annual Meeting, no new options will be granted
to the non-employee directors under the 1995 Plan. Such options will
thereafter be granted under the 2000 Plan. See "Approval of the 2000 Plan."
The Board held eight meetings in 1999. Each director attended at
least 75% of the aggregate of (i) the total number of meetings of the Board
and (ii) the total number of meetings held by all committees of the Board on
which he served during 1999.
PRINCIPAL SHAREHOLDERS
Management
The following table sets forth certain information, as of February
29, 2000, regarding beneficial ownership of Common Stock by each director,
nominee, each of the executive officers named in the Summary Compensation
Table set forth below and all directors, nominees and executive officers as a
group. Except as otherwise indicated in the footnotes, all of the persons
listed below have sole voting and investment power over the shares of Common
Stock identified as beneficially owned.
Shares of Percent
Common of
Name of Individual Stock Beneficially Class
Or Number in Group Owned (1)
William D. Gehl . . . . . . . . . . . . 191,563 3.4%
Nicholas C. Babson . . . . . . . . . . 1,833 *
Thomas J. Boldt . . . . . . . . . . . . 6,447 *
Fred M. Butler . . . . . . . . . . . . 5,947 *
John T. Byrnes . . . . . . . . . . . . 5,014 *
Richard J. Fotsch . . . . . . . . . . . 0 (2) *
William P. Killian . . . . . . . . . . 6,447 (3) *
Arthur W. Nesbitt . . . . . . . . . . . 7,972 (4) *
John W. Splude . . . . . . . . . . . . 5,747 *
Hermann Viets . . . . . . . . . . . . . 2,833 *
Malcolm F. Moore . . . . . . . . . . . 0 *
Kenneth P. Hahn . . . . . . . . . . . . 30,001 *
Michael J. Mulcahy . . . . . . . . . . 27,806 *
Richard J. Semler . . . . . . . . . . . 22,667 *
All directors, nominees and executive
officers as group (14 persons) 314,277 5.4%
* The amount shown is less than 1% of the outstanding shares.
(1) Includes shares subject to exercisable options as of February 29, 2000,
and options exercisable within 60 days of such date, as follows: Mr.
Gehl, 92,333 shares; Mr. Babson, 666 shares; Mr. Boldt, 4,665 shares;
Mr. Butler, 2,765 shares; Mr. Killian, 4,665 shares; Mr. Nesbitt, 4,665
shares; Mr. Splude, 4,665 shares; Dr. Viets, 666 shares; Mr. Hahn, 28,333
shares; Mr. Mulcahy, 23,499 shares; Mr. Semler, 19,499 shares; and all
directors, nominees and executive officers as a group, 186,421 shares.
(2) Mr. Fotsch is a new nominee for election as a director of the Company.
(3) Includes shares held by the Killian Family Trust for which Mr. Killian
serves as Trustee.
(4) Mr. Nesbitt will retire as a director at the time of the Annual Meeting.
Other Beneficial Owners
The following table sets forth certain information regarding
beneficial ownership by the only other persons known to the Company to own
more than 5% of the outstanding Common Stock. The beneficial ownership
information set forth below has been reported in filings made by the
beneficial owners with the Securities and Exchange Commission.
Amount and Nature of
Beneficial Ownership
Voting Power Investment Power
Name and Address Percent of
of Beneficial Owner Sole Shared Sole Shared Aggregate Class
FMR Corp. -0- -0- 639,000 -0- 639,000 11.5%
82 Devonshire Street
Boston, MA 02109 ..
Heartland Advisors, Inc. 172,000 -0- 460,000 -0- 460,000 8.2%
790 N. Milwaukee St.
Milwaukee, WI 53202 .
Dimensional Fund 394,224 -0- 394,224 -0- 394,224 7.1%
Advisors Inc.
1299 Ocean Avenue
Santa Monica, CA 90401
EXECUTIVE COMPENSATION
Summary Compensation Information
The following table sets forth certain information regarding compensation
awarded to, earned by or paid to the Company's Chief Executive Officer and
each of the four other executive officers of the Company whose salary and
bonus in fiscal 1999 exceeded $100,000. The executive officers named in the
table below are sometimes referred to herein as the "named executive officers."
SUMMARY COMPENSATION TABLE
Annual Long Term Compensation
Compensation
Awards Payouts
Name and Securities LTIP All
Principal Salary Bonus Underlying Payouts Other
Position Year ($) ($)(a) Options ($)(b) Compensation
William D. Gehl 1999 349,000 231,070 30,000 24,513 12,404 (c)
Chairman, President and 1998 300,000 166,450 25,000 20,320 10,391
Chief Executive Officer 1997 236,473 132,921 21,000 12,311 7,243
Malcolm F. Moore (d) 1999 91,346 51,578 25,000 --- 1,074 (e)
Executive Vice
President and
Chief Operating Officer
Kenneth P. Hahn 1999 125,620 48,463 10,000 6,050 6,204 (f)
Vice President of 1998 114,400 44,431 7,500 4,684 5,346
Finance, Treasurer 1997 96,796 38,154 5,000 1,810 3,195
and Chief
Financial Officer
Michael J. Mulcahy 1999 106,556 35,223 5,000 5,243 5,167 (g)
Vice President, 1998 98,800 32,891 5,000 4,614 4,968
Secretary and 1997 87,452 29,375 2,000 2,906 3,918
General Counsel
Richard J. Semler 1999 83,270 18,376 5,000 2,909 6,847 (h)
Vice President, 1998 76,055 16,879 5,000 2,695 6,501
Data Systems 1997 75,860 16,942 2,000 1,726 6,110
(a) The amounts shown in this column do not include bonus amounts in excess
of target which are credited to a "bonus bank" maintained for each of the
named executive officers. Such bonus amounts in the bonus bank for each
of the named executive officers are scheduled to be paid out over time,
but remain "at risk" and subject to loss pursuant to the Company's
"Shareholder Value Added" plan.
(b) The amounts shown in this column include payments out of the "bonus bank"
for each of the named executive officers paid pursuant to the Company's
"Shareholder Value Added" plan.
(c) Includes for 1999 (i) $6,852 in life insurance premiums paid by the
Company, (ii) $552 paid to Mr. Gehl for the purchase of long-term
disability insurance and (iii) a matching contribution of $5,000 under
the Gehl Savings Plan, a 401(k) Plan.
(d) Mr. Moore became Executive Vice President and Chief Operating Officer of
the Company on August 16, 1999.
(e) Consists of for 1999 $1,074 in life insurance premiums paid by the
Company.
(f) Includes for 1999 (i) $854 in life insurance premiums paid by the
Company, (ii) $528 paid to Mr. Hahn for the purchase of long-term
disability insurance and (iii) a matching contribution of $4,822 under
the Gehl Savings Plan, a 401(k) Plan.
(g) Includes for 1999 (i) $855 in life insurance premiums paid by the
Company, (ii) $562 paid to Mr. Mulcahy for the purchase of long-term
disability insurance and (iii) a matching contribution of $3,750 under
the Gehl Savings Plan, a 401(k) Plan.
(h) Includes for 1999 (i) $3,606 in life insurance premiums paid by the
Company, (ii) $437 paid to Mr. Semler for the purchase of long-term
disability insurance and (iii) a matching contribution of $2,804 under
the Gehl Savings Plan, a 401(k) Plan.
Long - Term Incentive Plan -- Awards in Last Fiscal Year
Bonus amounts in excess of a specified level for each of the named
executive officers as well as other participants are credited to a "bonus
bank" pursuant to the Company's "Shareholder Value Added" plan. The "bonus
bank" is an "at risk" deferred account for each plan participant that is
subject to loss pursuant to the terms of the plan. The maximum annual payout
for any individual participant is one-third of the aggregate balance in his
"bonus bank" account and is contingent on Company performance and the
participant continuing to be employed by the Company. Set forth below under
the heading "Maximum" is the amount credited to the "bonus bank" for each of
the named executive officers during fiscal 1999. The amount under the heading
"Threshold" reflects the fact that the amount credited to an individual's
"bonus bank" account is subject to total loss.
Long Term Incentive Plan Awards in 1999 Fiscal Year
Estimated Future Payouts under the Plan
Name Threshold($) Maximum ($)
William D. Gehl 0 42,140
Malcolm F. Moore 0 9,406
Kenneth P. Hahn 0 8,838
Michael J. Mulcahy 0 6,423
Richard J. Semler 0 3,351
Stock Options
The Company has in effect equity-based incentive plans pursuant to which
options to purchase Common Stock may be granted to key employees (including
executive officers) of the Company and its subsidiaries. The following table
presents certain information as to grants of stock options made during fiscal
1999 to each of the named executive officers.
Option Grants in 1999 Fiscal Year
Potential
Realizable Value
At Assumed Annual
Rates of Stock Price
Appreciation for
Individual Grants Option Term(2)
Percent of
Total
Number of Options
Securities Granted to Exercise At 5% At 10%
Underlying Employees or Base Annual Annual
Options in Fiscal Price Expiration Growth Growth
Granted(1) Year ($/share) Date Rate Rate
William D. Gehl 30,000 30% $17.75 12/16/09 $334,800 $848,700
Malcolm F. Moore 25,000 24.2% $22.50 8/14/09 $353,750 $896,500
Kenneth P. Hahn 10,000 9.7% $17.75 12/16/09 $111,600 $282,900
Michael J. Mulcahy 5,000 4.8% $17.75 12/16/09 $ 55,800 $141,450
Richard J. Semler 5,000 4.8% $17.75 12/16/09 $ 55,800 $141,450
______________
(1) The options reflected in the table for each of the named executive
officers (which are non-qualified options for purposes of the Internal
Revenue Code) were granted under the 1995 Plan and vest ratably over the
three-year period from the date of grant. Vesting of the options will be
accelerated in the event of the optionee's death or disability or in the
event of a change in control of the Company.
(2) This presentation is intended to disclose a potential value which would
accrue to the optionee if the option were exercised the day before it
would expire and if the per share value had appreciated at the compounded
annual rate indicated in each column. The assumed rates of appreciation
of 5% and 10% are prescribed by the rules of the Securities and Exchange
Commission regarding disclosure of executive compensation. The assumed
annual rates of appreciation are not intended to forecast possible future
appreciation, if any, with respect to the price of the Common Stock.
The following table sets forth information regarding the fiscal
year-end value of unexercised options held by the named executive officers.
No options were exercised by the named executive officers during 1999.
1999 Fiscal Year-End Option Values
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options
Options at Fiscal Year-End at Fiscal Year-End ($)(1)
Exercisable Unexercisable Exercisable Unexercisable
Name
William D. Gehl 92,333 53,667 698,332 74,168
Malcolm F. Moore 0 25,000 0 0
Kenneth P. Hahn 29,833 16,667 272,035 22,500
Michael J. Mulcahy 25,499 9,001 253,199 14,586
Richard J. Semler 21,499 9,001 213,541 14,586
(1) The dollar values are calculated by determining the difference between
the fair market value of the underlying Common Stock and the exercise
price of the options at fiscal year-end.
Retirement Plan
The Company maintains a defined benefit pension plan (the
"Retirement Plan") to provide retirement benefits to certain employees,
including the named executive officers. The following table estimates various
annual benefits payable at age 65 to participants with the years of service
and average compensation levels set forth below:
Final Estimated Annual Benefits Payable at Age 65
Annual For Indicated Years of Credited Service
Average
Compensation
5 Years 10 Years 15 Years 20 Years 25 Years 35+ Years
$ 75,000 $ 3,750 $ 7,500 $11,250 $15,000 $18,750 $26,250
100,000 5,000 10,000 15,000 20,000 25,000 35,000
130,000 6,500 13,000 19,500 26,000 32,500 45,500
160,000 8,000 16,000 24,000 32,000 40,000 56,000
A participant may elect one of several single life or joint and
survivor annuity payment options which provide monthly retirement benefits
calculated on an actuarial basis. Benefits under the Retirement Plan are not
reduced by a participant's Social Security benefits. The Retirement Plan
provides for reduced early retirement and pre-retirement benefits.
Compensation covered by the Retirement Plan for each of the named
executive officers is such person's salary as shown in the Summary
Compensation Table subject to a $160,000 maximum as provided in the Internal
Revenue Code. The number of years of credited service as of December 31, 1999
that will be recognized for Messrs. Gehl, Moore, Hahn, Mulcahy and Semler is
7.2 years, .3 years, 11.7 years, 24.6 years, and 39.6 years, respectively.
Supplemental Retirement Benefit Agreements
The Company has entered into a supplemental retirement benefit
agreement under which Mr. Gehl will receive a monthly retirement benefit for
fifteen years. Under the agreement, the monthly benefit to be received by Mr.
Gehl is computed by multiplying the percentage by which benefits have vested
by an amount equal to 50% of average monthly compensation computed by
reference to the base salary and cash bonus earned for the highest five
calendar years within the last ten completed calendar years of service
preceding termination, less any amounts Mr. Gehl would be entitled to receive
under the Retirement Plan or pursuant to Social Security. The agreement
provides for a pre-retirement death benefit consisting of ten annual payments
in the amount of 30% of the average annual compensation computed by reference
to the five highest annual base salaries and cash bonuses earned within the
last ten calendar years preceding the date of death. Benefits vest under the
agreement at a rate of 10% per year for the first four years of service with
the Company and are deemed to be fully vested after five years. In the event
there is a "change of control" of the Company, as defined in the supplemental
retirement benefit agreements, or in the event of the executive's disability,
benefits become 100% vested. Mr. Gehl is fully vested under his agreement.
The supplemental retirement benefit agreement also contains a covenant not to
compete which covers Mr. Gehl for a two-year period following his termination
of employment. Failure to comply with such provisions will result in a
forfeiture of benefits under the agreement.
The Company has also entered into supplemental retirement benefit
agreements under which Messrs. Moore, Hahn, Mulcahy and Semler will receive a
monthly retirement benefit for fifteen years. Under the agreements, the
monthly benefit to be received by each of Messrs. Moore, Hahn, Mulcahy and
Semler is computed by multiplying a vesting percentage by the product of (i) a
monthly amount computed by reference to the highest base salaries and cash
bonuses earned by Messrs. Moore, Hahn, Mulcahy and Semler during a consecutive
five-year period and (ii) 20%. The supplemental retirement benefit agreements
provide for a pre-retirement death benefit consisting of five annual payments
in the amount of 30% of the average annual salary computed by reference to the
highest base salaries and cash bonuses earned during a consecutive five-year
period preceding the date of death. As of December 31, 1999, Mr. Moore had
less than one year of credited service and Messrs. Hahn, Mulcahy and Semler
were fully vested under their respective supplemental retirement benefit
agreements. The supplemental retirement benefit agreements also contain a
covenant not to compete which covers Messrs. Moore, Hahn, Mulcahy and Semler
for a two-year period following termination of employment. Failure to comply
with such provisions will result in a forfeiture of benefits under the
agreements.
Assuming full vesting, the estimated annual benefits payable to
Messrs. Gehl, Hahn, Mulcahy and Semler under the supplemental retirement
benefit agreements based upon their current compensation would be $311,105
(less any amounts Mr. Gehl would be entitled to receive under the Retirement
Plan or pursuant to Social Security), $36,584, $29,640, and $20,999,
respectively. Assuming full vesting and compensation equal to his annualized
1999 salary and bonus, the annual benefit payable to Mr. Moore under his
supplemental retirement benefit agreement would be $86,590.
Employment Agreement
The Company has an employment agreement with Mr. Gehl pursuant to
which Mr. Gehl is to serve as the Chairman of the Board, President and Chief
Executive Officer of the Company through December 31, 2001. During the term
of his employment agreement, Mr. Gehl will be paid a minimum annual base
salary of $350,000. The base salary paid to Mr. Gehl under his employment
agreement will be reviewed at least annually by the Board or a committee
thereof and may be increased or decreased at that time subject to the minimum
base salary described above. Mr. Gehl's current base salary is $375,000.
If, for any reason other than cause or Mr. Gehl's death or
disability and other than in connection with a "change in control" of the
Company (as defined in his agreement), the employment of Mr. Gehl is
terminated before the term of employment has been completed, Mr. Gehl will be
entitled to receive his base salary for one (1) full year from the date of
termination as well as the opportunity to continue to participate in the
Company's employee benefit plans for such period. Pursuant to his agreement,
in the event of a change in control of the Company, the term of Mr. Gehl's
employment will automatically be extended to a date which is two years after
the change in control. In the event that during this two-year period the
Company terminates Mr. Gehl's employment (other than for cause) or if Mr. Gehl
terminates his employment for "good reason" (as defined in the employment
agreement), including as a result of significant changes in his working
conditions or status without his consent, Mr. Gehl will receive all accrued
but unpaid benefits to the date of his termination plus a lump-sum termination
payment equal to three times the sum of his current base salary and the
highest bonus he earned during the preceding five years. Mr. Gehl's agreement
also provides that he will receive family medical benefits for two years
following his termination as well as immediate vesting of unvested stock
options and other benefits. Mr. Gehl's employment agreement also provides the
benefits described above in connection with certain terminations which are
effected in anticipation of a change in control. The foregoing termination
payment and other benefits may be reduced to the extent necessary to avoid an
"excess parachute payment" under the Internal Revenue Code, but only if such
reduction would result in a greater after-tax benefit to Mr. Gehl. Under the
terms of his employment agreement, Mr. Gehl is also entitled to receive, among
other benefits, an annual cash bonus and certain life insurance coverage.
Under his employment agreement, Mr. Gehl is subject to a covenant not to
compete following termination of his employment with the Company.
Severance Agreements
The Company has in effect severance agreements with each of Messrs.
Moore, Hahn, Mulcahy and Semler. Pursuant to the terms of their respective
severance agreements, in the event of a "change in control" of the Company (as
defined in the agreements), Messrs. Moore, Hahn, Mulcahy and Semler will be
granted two-year employment terms with the Company and will be entitled to
such base salaries, bonus opportunities and other benefits substantially
equivalent to those to which they were entitled immediately prior to the
change in control. In addition, upon the change in control, their unvested
stock options will automatically vest and the amounts they have outstanding
under their respective "bonus banks" under the "Shareholder Value Added" plan
will become payable immediately. If, during the two-year employment period
following a change in control, the Company terminates the executive officer's
employment (other than for cause) or if the officer terminates his employment
for "good reason" (as defined in the severance agreements), including as a
result of significant changes in the executive officer's working conditions or
status without his consent, the officer will receive all accrued but unpaid
benefits to the date of termination plus a lump-sum termination payment equal
to two times the sum of his current base salary as well as family medical
benefits for two years. The severance agreements also provide that the
benefits described above may be payable in connection with certain
terminations which are effected in anticipation of a change in control. In
addition, the severance agreements provide that if the executive officer's
employment is involuntarily terminated by the Company other than for cause or
upon the officer's death or disability and other than in connection with a
change in control, the officer will be entitled to receive his base salary for
one (1) full year from the date of termination as well as the opportunity to
continue to participate in the Company's employee benefit plans for such
period. The foregoing termination and other benefits may be reduced to the
extent necessary to avoid an "excess parachute payment" under the Internal
Revenue Code, but only if such reduction would result in a greater after-tax
benefit to the executive officer.
Report on Executive Compensation
This Report on Executive Compensation describes the policies
employed generally by the Compensation and Benefits Committee for the
development of the Company's executive compensation program and the
application of these policies to executive compensation during fiscal 1999.
The members of the Compensation and Benefits Committee during fiscal 1999 were
Messrs. Butler (Chairman), Killian, Nesbitt and Splude.
Function of the Compensation and Benefits Committee:
The Compensation and Benefits Committee is responsible for the
various aspects of the Company's compensation program for its executive
officers. The Committee develops the compensation program for the Company's
executive officers, including the award of stock options under the Company's
stock option plans. Final approval of the Company's executive compensation
package as recommended by the Compensation and Benefits Committee (other than
the grant of options under the Company's stock option plans, which grants are
at the sole discretion of the Committee) is the responsibility of the Board.
During fiscal 1999, the Board adopted the recommendations of the Compensation
and Benefits Committee without material modification.
Executive Compensation and Stock Option Policies:
The basic policy of the Compensation and Benefits Committee is to
provide a competitive compensation program for executive officers sufficient
to attract and retain those executive officers considered crucial to the
attainment of the Company's long-term strategic goals, including the
enhancement of shareholder value. The compensation package for executive
officers consists of base salary, opportunities for cash bonuses and equity-
based awards, including stock options, and participation in other employee
benefits plans offered by the Company.
In determining salary levels for executive officers of the Company,
the Compensation and Benefits Committee takes into consideration each
individual's level of expertise and experience and his performance in his
particular area of responsibility during the past fiscal year as well as the
overall financial performance of the Company. In fixing salary levels, the
Committee also considers data regarding salaries paid by companies similarly
situated to the Company. Consistent with prior years, and although
compensation data from outside sources were reviewed by the Committee, the
Committee did not formally engage an outside compensation consultant in
connection with establishing salary levels for the Company's executive
officers for fiscal 1999.
In addition to base salaries, the Company's compensation package
includes an opportunity for key employees (including the executive officers)
to earn cash bonuses. The Company has in effect a program for its officers
and other key managers that awards incentive compensation based upon a
calculation of "Shareholder Value Added" or SVA. The Company's SVA plan
emphasizes economic value creation which occurs when a business generates a
financial return that exceeds the total cost of capital employed.
Specifically, the Company's plan defines SVA as the difference between (a) net
operating profit after tax and (b) the charge for capital employed in the
business. The Company's SVA plan is designed to reward those executive
officers and key managers who use Company assets most productively, reduce
costs, and create efficiencies throughout the Company's organization. Under
the Company's SVA plan, target bonuses calculated as a percent of salary are
fixed by the Compensation and Benefits Committee. Awards paid to participants
serving in an identified "value center" (e.g., a specific manufacturing
facility) under the SVA plan are based 30% (as a minimum) on total Company
performance with the remainder of the award based on the performance of the
respective value center(s). Awards to participants with corporate
responsibilities (including the Company's Chief Executive Officer) are based
entirely on Company performance. Target SVA levels were initially established
by the Compensation and Benefits Committee at the time the SVA plan was
adopted and adjust automatically on an annual basis by a predetermined
improvement factor. The Company's plan also incorporates a "bonus bank" into
which bonuses in excess of a target bonus level are credited. Such bonus
amounts are thereafter scheduled to be paid out over time, but remain "at
risk" and subject to loss depending on future Company and value center
performance as determined under the SVA plan. Bonuses paid to the named
executive officers for 1999 performance under the SVA plan are reflected in
the "Bonus" column of the Summary Compensation Table. Bonus amounts paid
which relate to previously "banked" bonus amounts under the SVA plan are
reflected in the "LTIP Payouts" column of the Summary Compensation Table.
To provide an additional performance incentive for its executive
officers and other key management personnel, the Company makes equity-based
awards, comprised of awards of stock options. The Company currently has in
effect stock option plans under which awards of stock options may be made to
the executive officers and other key employees. In the event that the 2000
Plan is approved by shareholders at the Annual Meeting, the Committee will
have additional flexibility to grant awards tied to the value of the Common
Stock to key employees of the Company. See "Approval of the 2000 Plan." The
general purpose of Company's current stock option plans is consistent with the
basic policy of the Company's executive compensation program which is designed
to promote the achievement of the long-range strategic goals of the Company
and to enhance shareholder value. Stock options granted by the Company have a
per share exercise price of 100% of the fair market value of a share of Common
Stock on the date of grant and, accordingly, the value of the option will be
dependent on the future market value of the Common Stock. Stock options
awarded by the Company generally vest over a three-year period. Consideration
is given to the financial performance of the Company in determining whether in
the first instance to grant stock options and in determining the size of any
stock option award. In addition, consideration is given to the level of
responsibility of the individual executive officer within the Company, the
performance of such officer in his area of responsibility and the officer's
salary grade in recommending the size of stock option awards. Although these
factors are considered, no specific weight is assigned to one factor as
compared to the others in making an option grant determination. Options
relating to an aggregate of 75,000 shares of Common Stock (including an option
grant for 30,000 shares made to the Company's Chief Executive Officer) were
awarded to the executive officers in 1999.
In addition to base salary, cash bonus opportunity and the potential
for equity-based awards, all executive officers of the Company are eligible to
participate in the various employee benefit plans offered to employees of the
Company. The Company's policy with respect to these plans (including the
Company's retirement plan, savings plan and life insurance program) is to
provide competitive benefits to its employees, including executive officers,
to encourage their continued service with the Company and to attract qualified
individuals for available Company positions.
CEO Compensation:
During fiscal 1999, Mr. Gehl, the Company's Chief Executive Officer,
was paid a salary at an annual rate of $350,000. In December 1999, Mr. Gehl's
annual base salary was increased to $375,000 effective January 1, 2000. Mr.
Gehl is party to an employment agreement with the Company described under the
heading "Executive Compensation-Employment Agreement." Pursuant to Mr. Gehl's
employment agreement, his base salary is subject to review on at least an
annual basis and may be increased or decreased as determined to be
appropriate, provided that Mr. Gehl's annual base salary may not be decreased
below $350,000. In fixing the base salary for Mr. Gehl for fiscal 1999, the
Compensation and Benefits Committee considered the qualifications and
experience Mr. Gehl brings to the Company and the Company's performance during
his tenure with the Company as Chief Executive Officer, and also reviewed
salaries paid by comparable companies. The Compensation and Benefits Committee
noted that during Mr. Gehl's tenure as Chief Executive Officer (which began in
November 1992) the Company's performance has improved significantly from a net
loss of $17.9 million for the year ended December 31, 1992 to net income of
$15.3 million and $20.2 million for the years ended December 31, 1998 and
1999, respectively. The Committee also noted the significant improvement in
shareholder value with the Company's shareholders' equity increasing from
$40.4 million at December 31, 1992 to $94.1 million and $97.4 million at
December 31, 1998 and 1999, respectively. The Compensation and Benefits
Committee believes that Mr. Gehl's base salary is within the average range for
salaries paid to chief executive officers of companies similarly situated to
the Company. For fiscal 1999 performance, Mr. Gehl also received a cash bonus
of $231,070 and a bonus bank" payment of $42,140 pursuant to the terms of the
Company's SVA plan as described above. In addition, based on the factors
described above, Mr. Gehl received on December 17, 1999 an option to purchase
30,000 shares of Common Stock at an exercise price of $17.75 per share.
Deductibility of Executive Compensation:
Under Section 162(m) of the Internal Revenue Code, a tax deduction
by certain corporate taxpayers, such as the Company, is limited with respect
to the compensation of specified executive officers unless such compensation
is based upon performance objectives meeting certain regulatory criteria or is
otherwise excluded from the limitation. The Compensation and Benefits
Committee intends to qualify compensation paid to the Company's executive
officers for deductibility by the Company under Section 162(m).
COMPENSATION AND BENEFITS COMMITTEE
Fred M. Butler (Chairman)
William P. Killian
Arthur W. Nesbitt
John W. Splude
PERFORMANCE INFORMATION
The following graph compares the cumulative total return (change in
stock price plus reinvested dividends) during the last five years of the
Common Stock with the Standard & Poor's 500 Composite Index and the Standard &
Poor's Machinery-Diversified Index. The graph assumes $100 was invested on
December 31, 1994 in each of the three alternatives.
Comparison of Five Year Cumulative Market Performance
Among S&P 500 Index, S&P Machinery-Diversified Index, and the Company
(Assumes $100 invested December 31, 1994 with dividends reinvested)
<graph>
December December December December December December
31, 1994 31, 1995 31, 1996 31, 1997 31, 1998 31, 1999
S&P
Composite 500 $100.00 $134.11 $161.29 $211.30 $266.38 $323.97
S&P
Machinery-
Diversified $100.00 $120.74 $147.55 $191.94 $165.65 $210.12
Gehl $100.00 $114.08 $174.00 $336.00 $246.00 $288.00
Although the companies included in the S & P Machinery-Diversified
Index generally have a larger market capitalization than the Company, such
companies are believed to provide the closest peer group representation with
respect to the industries served by the Company (agricultural implements and
light construction equipment).
APPROVAL OF THE 2000 PLAN
General
The purpose of the 2000 Plan is to promote the best interests of the
Company and its shareholders by providing key employees of the Company and its
affiliates, and members of the Board who are not employees of the Company or
its affiliates, with an opportunity to acquire a proprietary interest in the
Company. The 2000 Plan is intended to promote continuity of management and to
provide increased incentive and personal interest in the welfare of the
Company by those key employees who are primarily responsible for shaping and
carrying out the long-range plans of the Company and securing the Company's
continued growth and financial success. In addition, by encouraging stock
ownership by directors who are not employees of the Company or its affiliates,
the Company seeks to attract and retain on the Board persons of exceptional
competence and to provide a further incentive to serve as a director of the
Company.
The Company currently has in effect the 1995 Plan (the "1995 Plan").
As of December 31, 1999, 453,122 shares of Common Stock were subject to
outstanding options and 11,000 shares remained available for the granting of
additional options under the 1995 Plan. To the extent outstanding options
under the 1995 Plan expire unexercised, are cancelled or are terminated, the
shares subject thereto will be available for the granting of additional
options thereunder. In addition, although no new options may be granted
thereunder, the Company has in effect the 1987 Stock Option Plan (the "1987
Plan"). As of December 31, 1999, 154,512 options remained outstanding under
the 1987 Plan. To allow for additional stock option awards as well as awards
of stock appreciation rights ("SARs"), restricted stock and performance shares
to be made by the Company, the 2000 Plan was adopted by the Board on February
25, 2000. The 2000 Plan became effective on that date subject to shareholder
approval at the Annual Meeting.
The following summary description of the 2000 Plan is qualified in
its entirety by reference to the full text of such Plan which is attached to
this Proxy Statement as Appendix A.
Administration and Eligibility
The 2000 Plan is to be administered by a committee of the Board (the
"Committee") consisting of no less than two directors who are "non-employee
directors" within the meaning of Rule 16b-3 under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and who are "outside directors"
within the meaning of Section 162(m) of the Internal Revenue Code. In the
event that the Committee is not appointed, the functions of the Committee will
be exercised by those members of the Board who qualify as "non-employee
directors" under Rule 16b-3 and as "outside directors" within the meaning of
Section 162(m). The Compensation and Benefits Committee has been designated
as the initial administrator of the 2000 Plan. Among other functions, the
Committee has the authority to establish rules for the administration of the
2000 Plan; to select the key employees of the Company and its affiliates to
whom awards will be granted; to determine the types of awards to be granted to
key employees and the number of shares covered by such awards; and to set the
terms and conditions of such awards. The Committee may also determine whether
the payment of any proceeds of any award shall or may be deferred by a key
employee participating in the 2000 Plan. Under the 2000 Plan to the extent
permitted by applicable law, the Committee may delegate to one or more
executive officers of the Company any or all of the authority and
responsibility of the Committee in connection with the 2000 Plan, other than
with respect to those persons who file reports under Section 16 of the
Exchange Act (e.g., executive officers and directors of the Company). Subject
to the express terms of the 2000 Plan, determinations and interpretations with
respect thereto will be in the sole discretion of the Committee, whose
determinations and interpretations will be binding on all parties.
Any key employee of the Company or any affiliate, including any
executive officer or employee-director of the Company, is eligible to be
granted awards by the Committee under the 2000 Plan. In addition to key
employees, each non-employee director of the Company is automatically
entitled, as described below, to receive option grants under the 2000 Plan.
Approximately 70 persons are currently eligible to participate in the 2000
Plan. The number of eligible participants may increase over time based upon
future growth of the Company.
Awards Under the 2000 Plan; Available Shares
The 2000 Plan authorizes the granting to key employees of: (a) stock
options, which may be either incentive stock options meeting the requirements
of Section 422 of the Internal Revenue Code ("ISOs") or non-qualified stock
options; (b) SARs; (c) restricted stock; and (d) performance shares. The 2000
Plan also provides for the automatic grant of non-qualified options to non-
employee directors of the Company. The 2000 Plan provides that up to a total
of 600,000 shares of Common Stock (subject to adjustment as described below)
will be available for the granting of awards thereunder.
If any shares subject to awards granted under the 2000 Plan, or to
which any award relates, are forfeited or if an award otherwise terminates,
expires or is cancelled prior to the delivery of all of the shares or other
consideration issuable or payable pursuant to the award, such shares will be
available for the granting of new awards under the 2000 Plan. Any shares
delivered pursuant to an award may be either authorized and unissued shares of
Common Stock or treasury shares held by the Company.
Terms of Awards
Option Awards to Key Employees. Options granted under the 2000 Plan
to key employees may be either ISOs or non-qualified stock options. No
individual key employee may be granted, during any calendar year, options to
purchase in excess of 100,000 shares of Common Stock under the 2000 Plan
(subject to adjustment as described below).
The exercise price per share of Common Stock subject to options
granted to key employees under the 2000 Plan will be determined by the
Committee, provided that the exercise price may not be less than 100% of the
fair market value of a share of Common Stock on the date of grant. The 2000
Plan specifically prohibits the "repricing" of options where new options with
lower exercise prices are substituted for previously granted options. The
term of any option granted to a key employee under the 2000 Plan will be as
determined by the Committee, provided that the term of an option may not
exceed ten years from the date of its grant. Options granted to key employees
under the 2000 Plan will become exercisable in such manner and within such
period or periods and in such installments or otherwise as determined by the
Committee. Options may be exercised by payment in full of the exercise price,
either (at the discretion of the Committee) in cash or in whole or in part by
tendering shares of Common Stock or other consideration (including a
promissory note of the participant) having a fair market value on the date of
exercise equal to the option exercise price. All ISOs granted under the 2000
Plan will also be required to comply with all other terms of Section 422 of
the Internal Revenue Code.
Option Awards to Non-Employee Directors. The 2000 Plan provides that
each non-employee director (if he or she continues to serve in such capacity)
will, on the day after the annual meeting of shareholders in each year,
automatically be granted an option to purchase 2,000 shares of Common Stock
(subject to adjustment as described below). The options granted to non-
employee directors under the 2000 Plan become exercisable ratably over the
three-year period following the date of the grant. However, if a non-employee
director ceases to be a director of the Company by reason of death, disability
or retirement within three years after the date of grant or in the event of a
change of control of the Company (as defined in the 2000 Plan) within three
years after the date of grant, the option shall become immediately exercisable
in full. Non-employee directors will be entitled to receive the automatic
grants under the 2000 Plan as described above only for so long as the 2000
Plan remains in effect and a sufficient number of shares are available for the
granting of such options thereunder. In the event the 2000 Plan is approved
by shareholders at the Annual Meeting, no additional options will be granted
to the non-employee directors under the 1995 Plan.
The option price per share of any option granted to a non-employee
director must be 100% of the "market value" of a share of Common Stock on the
date of grant of such option. The "market value" of a share on the date of
grant to the non-employee director will be the last sale price per share for
the Common Stock on the Nasdaq Stock Market on the trading day next preceding
such grant date or, if no trading occurred on the trading date next preceding
the date on which the non-qualified stock option is granted, then the "market
value" per share shall be determined with reference to the next preceding date
on which the shares were traded.
Options granted to non-employee directors will terminate on the
earlier of (a) ten years after the date of grant or (b) twelve months after
the non-employee director ceases to be a director of the Company. Options
granted to non-employee directors may be exercised under the 2000 Plan by
payment in full of the exercise price, either in cash or in whole or in part
by tendering previously acquired shares of Common Stock having a market value
on the date of exercise equal to the option exercise price.
The Committee has no discretion to alter the provisions governing
options granted to non-employee directors.
SARs. An SAR granted under the 2000 Plan will confer on the key
employee holder a right to receive, upon exercise thereof, the excess of (a)
the fair market value of one share of Common Stock on the date of exercise
over (b) the grant price of the SAR as specified by the Committee. The grant
price of an SAR under the 2000 Plan may not be less than 100% of the fair
market value of a share of Common Stock on the date of grant. The grant
price, term, methods of exercise, methods of settlement (including whether the
holder of an SAR will be paid in cash, shares of Common Stock or other
consideration), and any other terms and conditions of any SAR granted under
the 2000 Plan are determined by the Committee at the time of grant. Pursuant
to the terms of the 2000 Plan, no individual key employee may be granted,
during any calendar year, SARs thereunder with respect to in excess of 100,000
shares of Common Stock (subject to adjustment as described below).
Restricted Stock. Shares of restricted Common Stock granted to key
employees under the 2000 Plan will be subject to such restrictions as the
Committee may impose, including any limitation on the right to vote such
shares or receive dividends thereon. The restrictions imposed on the shares
may lapse separately or in combination at such time or times, or in such
installments or otherwise, as the Committee may deem appropriate. Except as
determined by the Committee with respect to a number of shares not exceeding
10% of the shares authorized for issuance under the 2000 Plan, the applicable
restriction period for restricted Common Stock will be at least three years,
subject to earlier vesting at the Committee's discretion in the event of the
participant's death, disability or retirement or in the event of a change of
control of the Company.
The 2000 Plan limits the total number of shares of restricted stock
that may be awarded thereunder to 200,000 shares. In addition, no individual
key employee may be granted, during any calendar year, in excess of 75,000
shares of restricted stock under the 2000 Plan. The foregoing numerical
limitations on the issuance of shares of restricted stock are subject to
adjustment as described below.
Performance Shares. The 2000 Plan also provides for the granting of
performance shares to key employees. The Committee will determine and/or
select the applicable performance period, the performance goal or goals (and
the performance level or levels related thereto) to be achieved during any
performance period, the proportion of payments, if any, to be made for
performance between the minimum and full performance levels for any
performance goal and, if applicable, the relative percentage weighting given
to each of the selected performance goals, the restrictions applicable to
shares of restricted stock received upon payment of performance shares if
payment is made in such manner, and any other terms, conditions and rights
relating to the grant of performance shares. Under the terms of the 2000
Plan, the Committee may select from various performance goals, including
return on equity, return on investment, return on net assets, shareholder
value added, earnings from operations, pre-tax profits, net earnings, net
earnings per share, working capital as a percent of net sales, net cash
provided by operating activities, market price for the Common Stock and total
shareholder return. In conjunction with selecting the applicable performance
goal or goals, the Committee will also fix the relevant performance level or
levels (e.g., a 15% return on equity) which must be achieved with respect to
the goal or goals in order for the performance shares to be earned by the key
employee. The performance goals selected by the Committee under the 2000 Plan
may, to the extent applicable, relate to a specific division or subsidiary of
the Company or apply on a Company-wide basis.
Following completion of the applicable performance period, payment
on performance shares granted to and earned by key employees will be made in
shares of Common Stock (which, at the discretion of the Committee, may be
shares of restricted stock) equal to the number of performance shares payable.
The Committee may provide that, during a performance period, key employees
will be paid cash amounts with respect to each performance share granted to
such key employees equal to the cash dividend paid on a share of Common Stock.
Pursuant to the terms of the 2000 Plan, no key employee may receive, during
any calendar year, more than 75,000 performance shares thereunder (subject to
adjustment as described below).
Adjustments
If any dividend or other distribution, recapitalization, stock
split, reverse stock split, reorganization, merger, consolidation, split-up,
spin-off, combination, repurchase, or exchange of shares of Common Stock or
other securities of the Company, issuance of warrants or other rights to
purchase shares of Common Stock or other securities of the Company, or other
similar corporate transaction or event affects the shares of Common Stock so
that an adjustment is appropriate in order to prevent dilution or enlargement
of the benefits or potential benefits intended to be made available under the
2000 Plan, then the Committee will generally have the authority to, in such
manner as it deems equitable, adjust (a) the number and type of shares subject
to the 2000 Plan and which thereafter may be made the subject of awards, (b)
the number and type of shares subject to outstanding awards, and (c) the
grant, purchase or exercise price with respect to any award, or may make
provision for a cash payment to the holder of an outstanding award.
Limits on Transferability
Except as otherwise provided by the Committee, no award granted
under the 2000 Plan (other than an award of restricted stock on which the
restrictions have lapsed) may be assigned, sold, transferred or encumbered by
any participant, otherwise than by will, by designation of a beneficiary, or
by the laws of descent and distribution. Except as otherwise provided by the
Committee, each award will be exercisable during the participant's lifetime
only by such participant or, if permissible under applicable law, by the
participant's guardian or legal representative.
Amendment and Termination
The Board may amend, suspend or terminate the 2000 Plan at any time,
except that no such action may adversely affect any award granted and then
outstanding thereunder without the approval of the respective participant. The
2000 Plan further provides that shareholder approval of any amendment thereto
must also be obtained: (a) if such amendment (i) increases the number of
shares with respect to which awards may be made under the 2000 Plan (other
than increases resulting from the adjustments described above), (ii) expands
the class of persons eligible to participate under the 2000 Plan, or (iii)
otherwise increases in any material respect the benefits payable under the
2000 Plan; or (b) if otherwise required by (i) the Internal Revenue Code or
any rules promulgated thereunder (in order to allow for ISOs to be granted
thereunder) or (ii) the quotation or listing requirements of the exchange or
market on which the Common Stock is then traded (in order to maintain the
trading of the Common Stock on such exchange or market).
Withholding
Not later than the date as of which an amount first becomes
includible in the gross income of a key employee for federal income tax
purposes with respect to any award under the 2000 Plan, the key employee will
be required to pay to the Company, or make arrangements satisfactory to the
Company regarding the payment of, any federal, state, local or foreign taxes
of any kind required by law to be withheld with respect to such amount.
Unless otherwise determined by the Committee, withholding obligations arising
with respect to awards under the 2000 Plan may be settled with shares of
Common Stock (other than shares of restricted stock), including shares of
Common Stock that are part of, or are received upon exercise of, the award
that gives rise to the withholding requirement. The obligations of the
Company under the 2000 Plan are conditional on such payment or arrangements,
and the Company and any affiliate will, to the extent permitted by law, have
the right to deduct any such taxes from any payment otherwise due to the key
employee. The Committee may establish such procedures as it deems appropriate
for the settling of withholding obligations with shares of Common Stock.
Certain Federal Income Tax Consequences
Stock Options. The grant of a stock option under the 2000 Plan
creates no income tax consequences to the key employee or the non-employee
director or the Company. A key employee or a non-employee director who is
granted a non-qualified stock option will generally recognize ordinary income
at the time of exercise in an amount equal to the excess of the fair market
value of the Common Stock at such time over the exercise price. The Company
will be entitled to a deduction in the same amount and at the same time as
ordinary income is recognized by the key employee or the non-employee
director. A subsequent disposition of the Common Stock will give rise to
capital gain or loss to the extent the amount realized from the sale differs
from the tax basis, i.e., the fair market value of the Common Stock on the
date of exercise. This capital gain or loss will be a long-term capital gain
or loss if the Common Stock has been held for more than one year from the date
of exercise.
In general, a key employee will recognize no income or gain as a
result of exercise of an ISO (except that the alternative minimum tax may
apply). Except as described below, any gain or loss realized by the key
employee on the disposition of the Common Stock acquired pursuant to the
exercise of an ISO will be treated as a long-term capital gain or loss and no
deduction will be allowed to the Company. If the key employee fails to hold
the shares of Common Stock acquired pursuant to the exercise of an ISO for at
least two years from the date of grant of the ISO and one year from the date
of exercise, the key employee will recognize ordinary income at the time of
the disposition equal to the lesser of (a) the gain realized on the
disposition or (b) the excess of the fair market value of the shares of Common
Stock on the date of exercise over the exercise price. The Company will be
entitled to a deduction in the same amount and at the same time as ordinary
income is recognized by the key employee. Any additional gain realized by the
key employee over the fair market value at the time of exercise will be
treated as a capital gain. This capital gain will be a long-term capital gain
if the Common Stock has been held for more than one year from the date of
exercise.
Stock Appreciation Rights. The grant of an SAR will create no
income tax consequences for the key employee or the Company. Upon exercise of
an SAR, the key employee will recognize ordinary income equal to the amount of
any cash and the fair market value of any shares of Common Stock or other
property received, except that if the key employee receives an option or
shares of restricted stock upon exercise of an SAR, recognition of income may
be deferred in accordance with the rules applicable to such other awards. The
Company will be entitled to a deduction in the same amount and at the same
time as income is recognized by the key employee.
Restricted Stock. A key employee will not recognize income at the
time an award of restricted stock is made under the 2000 Plan, unless the
election described below is made. A key employee who has not made such an
election will recognize ordinary income at the time the restrictions on the
stock lapse in an amount equal to the fair market value of the restricted
stock at such time reduced by any amount paid for the restricted stock. The
Company will generally be entitled to a corresponding deduction in the same
amount and at the same time as the key employee recognizes income.
Any otherwise taxable disposition of the restricted stock after the time the
restrictions lapse will generally result in capital gain or loss (long-term or
short-term depending upon the length of time the restricted stock is held
after the time the restrictions lapse). Dividends paid in cash and received
by a participant prior to the time the restrictions lapse will constitute
ordinary income to the participant in the year paid. The Company will be
entitled to a corresponding deduction for such dividends. Any dividends paid
in stock will be treated as an award of additional restricted stock subject to
the tax treatment described herein.
A key employee may, within 30 days after the date of the award of
restricted stock, elect to recognize ordinary income as of the date of the
award in an amount equal to the fair market value of such restricted stock on
the date of the award reduced by any amount paid for the restricted stock.
The Company will be entitled to a corresponding deduction in the same amount
and at the same time as the key employee recognizes income. If the election
is made, any cash dividends received with respect to the restricted stock will
be treated as dividend income to the key employee in the year of payment and
will not be deductible by the Company. Any otherwise taxable disposition of
the restricted stock (other than by forfeiture) will result in capital gain or
loss (long-term or short-term depending on the holding period). If the key
employee who has made an election subsequently forfeits the restricted stock,
the key employee will not be entitled to deduct any loss. In addition, the
Company would then be required to include as ordinary income the amount of the
deduction it originally claimed with respect to such shares.
Performance Shares. The grant of performance shares will create no
income tax consequences for the key employee or the Company. Upon the receipt
of shares of Common Stock at the end of the applicable performance period, the
key employee will recognize ordinary income equal to the fair market value of
the shares of Common Stock received, except that if the key employee receives
shares of restricted stock in payment of performance shares, recognition of
income may be deferred in accordance with the rules applicable to such
restricted stock. In addition, the key employee will recognize ordinary
income equal to the dividend equivalents paid on performance shares prior to
or at the end of the performance period. The Company will be entitled to a
deduction in the same amount and at the same time as income is recognized by
the key employee.
New Plan Benefits
Other than the automatic grant of stock options to non-employee
directors, the Company cannot currently determine the number of awards or the
type of awards that may be granted to eligible participants under the 2000
Plan in the future. Such determinations will be made from time to time by the
Committee.
On February 25, 2000, the last sale price per share of the Common
Stock on the Nasdaq Stock Market was $17.94.
Vote Required
The affirmative vote of the holders of a majority of the shares of
Common Stock represented and voted at the Annual Meeting (assuming a quorum is
present) is required to approve the 2000 Plan. Any shares not voted at the
Annual Meeting (whether as a result of broker non-votes, abstentions or
otherwise) with respect to the 2000 Plan will have no impact on the vote.
THE BOARD RECOMMENDS A VOTE "FOR" THE 2000 PLAN. SHARES OF COMMON
STOCK REPRESENTED AT THE ANNUAL MEETING BY EXECUTED BUT UNMARKED PROXIES WILL
BE VOTED "FOR" THE 2000 PLAN.
MISCELLANEOUS
Independent Auditors
The Board has appointed PricewaterhouseCoopers LLP as the Company's
independent auditors for 2000. PricewaterhouseCoopers LLP acted as the
independent auditors for the Company for the year ended December 31, 1999.
Representatives of PricewaterhouseCoopers LLP are expected to be present at
the Annual Meeting with the opportunity to make a statement if they so desire.
Such representatives are also expected to be available to respond to
appropriate questions.
Shareholder Proposals
Proposals of shareholders pursuant to Rule 14a-8 under the
Securities Exchange Act of 1934, as amended ("Rule 14a-8"), that are intended
to be presented at the 2001 annual meeting of shareholders must be received by
the Company no later than November 6, 2000 to be included in the Company's
proxy materials for that meeting. Further, a shareholder who otherwise
intends to present business at the 2001 annual meeting must comply with the
requirements set forth in the Company's By-laws. Among other things, to bring
business before an annual meeting, a shareholder must give written notice
thereof, complying with the By-laws, to the Secretary of the Company not less
than 60 days and not more than 90 days prior to the last Thursday in the month
of April, provided that the date of the annual meeting is not advanced by more
than 30 days or delayed by more than 60 days from the last Thursday in the
month of April. The 2001 annual meeting of shareholders is tentatively
scheduled to be held on April 26, 2001. Under the By-laws, if the Company
does not receive notice of a shareholder proposal submitted otherwise than
pursuant to Rule 14a-8 (i.e., a proposal a shareholder intends to present at
the 2001 annual meeting of shareholders but does not intend to have included
in the Company's proxy materials) on or prior to February 25, 2001 (assuming
an April 26, 2001 meeting date), then the notice will be considered untimely
and the Company will not be required to present such proposal at the 2001
annual meeting. If the Board nonetheless chooses to present such proposal at
the 2001 annual meeting, then the persons named in proxies solicited by the
Board for the 2001 annual meeting may exercise discretionary voting power with
respect to such proposal.
Other Matters
The cost of soliciting proxies will be borne by the Company. The
Company will reimburse brokers and other nominees for their expenses in
communicating with the persons for whom they hold Common Stock. The Company
expects to solicit proxies primarily by mail. Proxies may also be solicited
personally and by telephone by certain officers and regular employees of the
Company.
The Company will provide without charge a copy of its Annual Report
on Form 10-K (including financial statements and financial schedules, but not
including exhibits thereto), as filed with the Securities and Exchange
Commission, to each person who is a record or beneficial holder of Common
Stock as of the record date for the Annual Meeting. A written request for a
Form 10-K should be addressed to Gehl Company, Attention: Secretary, 143
Water Street, West Bend, Wisconsin 53095.
By Order of the Board of Directors
GEHL COMPANY
Michael J. Mulcahy
Secretary
March 6, 2000
<PAGE>
APPENDIX A
GEHL COMPANY
2000 EQUITY INCENTIVE PLAN
Section 1.Purpose
The purpose of the Gehl Company 2000 Equity Incentive Plan (the "Plan") is to
promote the best interests of Gehl Company (together with any successor
thereto, the "Company") and its shareholders by providing key employees of the
Company and its Affiliates (as defined below) and members of the Company's
Board of Directors who are not employees of the Company or its Affiliates with
an opportunity to acquire a proprietary interest in the Company. It is
intended that the Plan will promote continuity of management and increased
incentive and personal interest in the welfare of the Company by those key
employees who are primarily responsible for shaping and carrying out the long-
range plans of the Company and securing the Company's continued growth and
financial success. In addition, by encouraging stock ownership by directors
who are not employees of the Company or its Affiliates, the Company seeks to
attract and retain on its Board of Directors persons of exceptional competence
and to provide a further incentive to serve as a director of the Company.
Section 2. Definitions
As used in the Plan, the following terms shall have the respective
meanings set forth below:
(a) "Affiliate" shall mean any entity that, directly or through one or
more intermediaries, is controlled by, controls, or is under common control
with, the Company.
(b) "Award" shall mean any Option, Stock Appreciation Right, Restricted
Stock or Performance Share granted under the Plan.
(c) "Award Agreement" shall mean any written agreement, contract, or
other instrument or document evidencing any Award under the Plan.
(d) "Change of Control of the Company" shall mean any one of the
following events: (i) securities of the Company representing 25% or more of
the combined voting power of the Company's then outstanding voting securities
are acquired pursuant to a tender offer or exchange offer; (ii) the
shareholders of the Company approve a merger or consolidation of the Company
with any other Person as a result of which less than 50% of the outstanding
voting securities of the surviving or resulting Person would be owned by the
former shareholders of the Company (other than a shareholder who is an
Affiliate of any party to such consolidation or merger); (iii) the
shareholders of the Company approve the sale of substantially all of the
Company's assets to a Person which is not a wholly-owned subsidiary of the
Company; (iv) any person becomes a beneficial owner (as such term is defined
in Rule 13d-3 of the Exchange Act (or any successor provision thereto)),
directly or indirectly, of securities of the Company representing 25% or more
of the combined voting power of the Company's then outstanding securities the
effect of which (as determined by the Board of Directors of the Company) is to
take over control of the Company; or (v) during any period of two consecutive
years, individuals who, at the beginning of such period, constituted the Board
of Directors of the Company cease, for any reason, to constitute at least a
majority thereof, unless the election or nomination for election of each new
director was approved by the vote of at least two-thirds of the directors of
the Company then in office who were directors of the Company at the beginning
of the period.
(e) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
(f) "Commission" shall mean the United States Securities and Exchange
Commission or any successor agency.
(g) "Committee" shall mean a committee of the Board of Directors of the
Company designated by such Board to administer the Plan and comprised of not
less than two directors, each of whom is a "non-employee director" within the
meaning of Rule 16b-3 and each of whom is an "outside director" within the
meaning of Section 162(m)(4)(C) of the Code (or any successor provision
thereto).
(h) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
(i) "Excluded Items" shall mean any items which the Committee determines
shall be excluded in fixing Performance Goals, such as any gains or losses
from discontinued operations, any extraordinary gains or losses and the
effects of accounting changes.
(j) "Fair Market Value" shall mean, with respect to any property
(including, without limitation, any Shares or other securities), the fair
market value of such property determined by such methods or procedures as
shall be established from time to time by the Committee.
(k) "Incentive Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is intended to meet the requirements of
Section 422 of the Code (or any successor provision thereto).
(l) "Key Employee" shall mean any officer or other key employee of the
Company or of any Affiliate who is responsible for or contributes to the
management, growth or profitability of the business of the Company or any
Affiliate as determined by the Committee.
(m) "Non-Employee Director" shall mean any member of the Company's Board
of Directors who is not an employee of the Company or of any Affiliate.
(n) "Non-Qualified Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is not intended to be an Incentive Stock Option
and shall mean any option granted to a Non-Employee Director under Section
6(b) of the Plan.
(o) "Option" shall mean an Incentive Stock Option or a Non-Qualified
Stock Option.
(p) "Participating Key Employee" shall mean a Key Employee designated to
be granted an Award under the Plan.
(q) "Performance Goals" shall mean the following (in all cases after
excluding the impact of applicable Excluded Items):
(i) Return on equity for the Performance Period for the Company on
a consolidated basis.
(ii) Return on investment for the Performance Period (aa) for the
Company on a consolidated basis, (bb) for any one or more Affiliates or
divisions of the Company and/or (cc) for any other business unit or units of
the Company as defined by the Committee at the time of selection.
(iii) Return on net assets for the Performance Period (aa)
for the Company on a consolidated basis, (bb) for any one or more Affiliates
or divisions of the Company and/or (cc) for any other business unit or units
of the Company as defined by the Committee at the time of selection.
(iv) Shareholder value added (as defined by the Committee at the
time of selection) for the Performance Period (aa) for the Company on a
consolidated basis, (bb) for any one or more Affiliates or divisions of the
Company and/or (cc) for any other business unit or units of the Company as
defined by the Committee at the time of selection.
(v) Earnings from operations for the Performance Period (aa) for
the Company on a consolidated basis, (bb) for any one or more Affiliates or
divisions of the Company and/or (cc) for any other business unit or units of
the Company as defined by the Committee at the time of selection.
(vi) Pre-tax profits for the Performance Period (aa) for the Company
on a consolidated basis, (bb) for any one or more Affiliates or divisions of
the Company and/or (cc) for any other business unit or units of the Company as
defined by the Committee at the time of selection.
(vii) Net earnings for the Performance Period (aa) for the
Company on a consolidated basis, (bb) for any one or more Affiliates or
divisions of the Company and/or (cc) for any other business unit or units of
the Company as defined by the Committee at the time of selection.
(viii) Net earnings per Share for the Performance Period for the
Company on a consolidated basis.
(ix) Working capital as a percent of net sales for the Performance
Period (aa) for the Company on a consolidated basis, (bb) for any one or more
Affiliates or divisions of the Company and/or (cc) for any other business unit
or units of the Company as defined by the Committee at the time of selection.
(x) Net cash provided by operating activities for the Performance
Period (aa) for the Company on a consolidated basis, (bb) for any one or more
Affiliates or divisions of the Company and/or (cc) for any other business unit
or units of the Company as defined by the Committee at the time of selection.
(xi) Market price per Share for the Performance Period.
(xii) Total shareholder return for the Performance Period for
the Company on a consolidated basis.
(r) "Performance Period" shall mean, in relation to Performance Shares,
any period for which a Performance Goal or Goals have been established;
provided, however, that such period shall not be less than one year.
(s) "Performance Share" shall mean any right granted under Section 6(e)
of the Plan that will be paid out as a Share (which, in specified
circumstances, may be a Share of Restricted Stock).
(t) "Person" shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization, or
government or political subdivision thereof.
(u) "Released Securities" shall mean Shares of Restricted Stock with
respect to which all applicable restrictions have expired, lapsed, or been
waived.
(v) "Restricted Securities" shall mean Awards of Restricted Stock or
other Awards under which issued and outstanding Shares are held subject to
certain restrictions.
(w) "Restricted Stock" shall mean any Share granted under Section 6(d)
of the Plan or, in specified circumstances, a Share paid in connection with
a Performance Share under Section 6(e) of the Plan.
(x) "Rule 16b-3" shall mean Rule 16b-3 as promulgated by the
Commission under the Exchange Act, or any successor rule or regulation
thereto.
(y) "Shares" shall mean shares of common stock of the Company, $.10
par value, and such other securities or property as may become subject to
Awards pursuant to an adjustment made under Section 4(b) of the Plan.
(z) "Stock Appreciation Right" shall mean any right granted under
Section 6(c) of the Plan.
Section 3. Administration
The Plan shall be administered by the Committee; provided, however,
that if at any time the Committee shall not be in existence, the functions of
the Committee as specified in the Plan shall be exercised by a committee
consisting of those members of the Board of Directors of the Company who
qualify as "non-employee directors" under Rule 16b-3 and as "outside
directors" under Section 162(m)(4)(C) of the Code (or any successor provision
thereto). To the extent permitted by applicable law, the Committee may
delegate to one or more executive officers of the Company any or all of the
authority and responsibility of the Committee with respect to the Plan, other
than with respect to Persons who are subject to Section 16 of the Exchange
Act. To the extent the Committee has so delegated to one or more executive
officers the authority and responsibility of the Committee, all references to
the Committee herein shall include such officer or officers. Subject to the
terms of the Plan and without limitation by reason of enumeration, the
Committee shall have full power and authority to: (i) designate Participating
Key Employees; (ii) determine the type or types of Awards to be granted to
each Participating Key Employee under the Plan; (iii) determine the number of
Shares to be covered by (or with respect to which payments, rights, or other
matters are to be calculated in connection with) Awards granted to
Participating Key Employees; (iv) determine the terms and conditions of any
Award granted to a Participating Key Employee; (v) determine whether, to what
extent, and under what circumstances Awards granted to Participating Key
Employees may be settled or exercised in cash, Shares, other securities, other
Awards, or other property, and the method or methods by which Awards may be
settled, exercised, cancelled, forfeited, or suspended; (vi) determine
whether, to what extent, and under what circumstances cash, Shares, other
Awards, and other amounts payable with respect to an Award granted to
Participating Key Employees under the Plan shall be deferred either
automatically or at the election of the holder thereof or of the Committee;
(vii) interpret and administer the Plan and any instrument or agreement
relating to, or Award made under, the Plan (including, without limitation, any
Award Agreement); (viii) establish, amend, suspend, or waive such rules and
regulations and appoint such agents as it shall deem appropriate for the
proper administration of the Plan; and (ix) make any other determination and
take any other action that the Committee deems necessary or desirable for the
administration of the Plan. Unless otherwise expressly provided in the Plan,
all designations, determinations, interpretations, and other decisions under
or with respect to the Plan or any Award shall be within the sole discretion
of the Committee, may be made at any time, and shall be final, conclusive, and
binding upon all Persons, including the Company, any Affiliate, any
Participating Key Employee, any Non-Employee Director, any holder or
beneficiary of any Award, any shareholder, and any employee of the Company or
of any Affiliate. Notwithstanding the foregoing, Awards to Non-Employee
Directors under the Plan shall be automatic and the amount and terms of such
Awards shall be determined as provided in Section 6(b) of the Plan.
Section 4. Shares Available for Award
(a) Shares Available. Subject to adjustment as provided in Section
4(b):
(i) Number of Shares Available. The number of Shares with respect
to which Awards may be granted under the Plan shall be 600,000. If, after the
effective date of the Plan, any Shares covered by an Award granted under the
Plan, or to which any Award relates, are forfeited or if an Award otherwise
terminates, expires or is cancelled prior to the delivery of all of the Shares
or of other consideration issuable or payable pursuant to such Award, then the
number of Shares counted against the number of Shares available under the Plan
in connection with the grant of such Award, to the extent of any such
forfeiture, termination, expiration or cancellation, shall again be available
for granting of additional Awards under the Plan.
(ii) Limitations on Awards to Individual Participants. During any
one calendar year, no Participating Key Employee shall be granted Awards under
the Plan that could result in such Participating Key Employee receiving
Options for more than 100,000 Shares, Stock Appreciation Rights with respect
to more than 100,000 Shares, more than 75,000 Shares of Restricted Stock
and/or more than 75,000 Performance Shares. Such number of Shares as
specified in the preceding sentence shall be subject to adjustment in
accordance with the terms of Section 4(b) hereof. In all cases,
determinations under this Section 4(a)(ii) shall be made in a manner that is
consistent with the exemption for performance-based compensation provided by
Section 162(m) of the Code (or any successor provision thereto) and any
regulations promulgated thereunder.
(iii) Accounting for Awards. The number of Shares covered by an
Award under the Plan, or to which such Award relates, shall be counted on the
date of grant of such Award against the number of Shares available for
granting Awards under the Plan.
(iv) Sources of Shares Deliverable Under Awards. Any Shares
delivered pursuant to an Award may consist, in whole or in part, of authorized
and unissued Shares or of treasury Shares.
(b) Adjustments. In the event that the Committee shall determine that
any dividend or other distribution (whether in the form of cash, Shares, other
securities, or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of Shares or other securities of the Company, issuance
of warrants or other rights to purchase Shares or other securities of the
Company, or other similar corporate transaction or event affects the Shares
such that an adjustment is determined by the Committee to be appropriate in
order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan, then the Committee may, in such
manner as it may deem equitable, adjust any or all of (i) the number and type
of Shares subject to the Plan and which thereafter may be made the subject of
Awards under the Plan, (ii) the number and type of Shares subject to
outstanding Awards, and (iii) the grant, purchase, or exercise price with
respect to any Award, or, if deemed appropriate, make provision for a cash
payment to the holder of an outstanding Award; provided, however, in each
case, that with respect to Awards of Incentive Stock Options no such
adjustment shall be authorized to the extent that such authority would cause
the Plan to violate Section 422(b) of the Code (or any successor provision
thereto); and provided further that the number of Shares subject to any Award
payable or denominated in Shares shall always be a whole number.
Notwithstanding the foregoing, Non-Qualified Stock Options subject to grant or
previously granted to Non-Employee Directors under Section 6(b) of the Plan at
the time of any event described in the preceding sentence shall be subject to
only such adjustments as shall be necessary to maintain the relative
proportionate interest represented thereby immediately prior to any such event
and to preserve, without exceeding, the value of such Options.
Section 5. Eligibility
Any Key Employee, including any executive officer or employee-director of
the Company or of any Affiliate, shall be eligible to be designated a
Participating Key Employee. All Non-Employee Directors shall receive Awards
of Non-Qualified Stock Options as provided in Section 6(b).
Section 6. Awards
(a) Option Awards to Key Employees. The Committee is hereby authorized
to grant Options to Key Employees with the terms and conditions as set forth
below and with such additional terms and conditions, in either case not
inconsistent with the provisions of the Plan, as the Committee shall
determine; provided, however, that no Option shall be granted in connection
with the cancellation of a previously granted Option under the Plan if the
exercise price of the later granted Option is less than the exercise price of
the earlier granted Option.
(i) Exercise Price. The exercise price per Share of an Option
granted pursuant to this Section 6(a) shall be determined by the Committee;
provided, however, that such exercise price shall not be less than 100% of the
Fair Market Value of a Share on the date of grant of such Option.
(ii) Option Term. The term of each Option shall be fixed by the
Committee; provided, however, that in no event shall the term of any Option
exceed a period of ten years from the date of its grant.
(iii) Exercisability and Method of Exercise. An Option shall
become exercisable in such manner (including, without limitation, accelerated
exercisability in the event of Change of Control of the Company) and within
such period or periods and in such installments or otherwise as shall be
determined by the Committee. Unless the Committee shall otherwise determine
on or prior to the date of grant of an Option, such Option may be exercised,
in whole or in part, from and after the date it was granted in accordance with
the following schedule:
Cumulative Percentage of Shares Subject
to Option Which May be Purchased (which
Elapsed Period of Time number of Shares shall be rounded
After Date Option is Granted down to the nearest whole number)
Less than One (1) Year 0%
One (1) Year 33-1/3%
Two (2) Years 66-2/3%
Three (3) Years 100%
The Committee also shall determine the method or methods by which, and the
form or forms, including, without limitation, cash, Shares, other securities,
other Awards, or other property, or any combination thereof, having a Fair
Market Value on the exercise date equal to the relevant exercise price, in
which payment of the exercise price with respect to any Option may be made or
deemed to have been made. At the sole discretion of the Committee, the
payment of the exercise price with respect to any Option may be in the form of
a promissory note issued to the Company by a Participating Key Employee on
such terms and conditions as the Committee determines.
(iv) Incentive Stock Options. The terms of any Incentive Stock
Option granted under the Plan shall comply in all respects with the provisions
of Section 422 of the Code (or any successor provision thereto) and any
regulations promulgated thereunder. Notwithstanding any provision in the Plan
to the contrary, no Incentive Stock Option may be granted hereunder after the
tenth anniversary of the adoption of the Plan by the Board of Directors of the
Company.
(b) Non-Qualified Stock Option Awards to Non-Employee Directors.
(i) Eligibility. Each Non-Employee Director shall automatically be
granted Non-Qualified Stock Options under the Plan in the manner set forth in
this Section 6(b). A Non-Employee Director may hold more than one Non-
Qualified Stock Option.
(ii) Annual Option Grants to Non-Employee Directors. Each Non-
Employee Director (if he or she continues to serve in such capacity) shall, on
the day following the annual meeting of shareholders in each year during the
time the Plan is in effect, automatically be granted a Non-Qualified Stock
Option to purchase 2,000 Shares (which number of Shares shall be subject to
adjustment in the manner provided in Section 4(b) hereof).
(iii) Grant Limitation. Notwithstanding the provisions of
Section 6(b)(ii) hereof, Non-Qualified Stock Options shall be automatically
granted to Non-Employee Directors under the Plan only for so long as the Plan
remains in effect and a sufficient number of Shares are available hereunder
for the granting of such Options.
(iv) Exercise Price. The exercise price per Share for a Non-
Qualified Stock Option granted to a Non-Employee Director under the Plan shall
be equal to 100% of the "market value" of a Share on the date of grant of such
Option. The "market value" of a Share on the date of grant to the Non-
Employee Director shall be the last sale price per Share for the Shares on The
Nasdaq Stock Market on the trading date next preceding such grant date;
provided, however, that if the principal market for the Shares is then a
national securities exchange, the "market value" shall be the closing price
per Share for the Shares on the principal securities exchange on which the
Shares are traded on the trading date next preceding the date of grant, or, in
either case above, if no trading occurred on the trading date next preceding
the date on which the Non-Qualified Stock Option is granted, then the "market
price" per Share shall be determined with reference to the next preceding date
on which the Shares were traded.
(v) Exercisability of Options. Non-Qualified Stock Options granted
to Non-Employee Directors under the Plan shall become exercisable in
accordance with the following schedule:
Cumulative Percentage of Shares
Subject To Option Which May be Purchased
Elapsed Period of Time (which number of Shares shall be rounded
After Date Option is Granted down to the nearest whole number)
Less than One (1) Year 0%
One (1) Year 33-1/3%
Two (2) Years 66-2/3%
Three (3) Years 100%
Notwithstanding the foregoing schedule, if a Non-Employee Director ceases to
be a director of the Company by reason of death, disability or retirement
within three (3) years after the date of grant or in the event of a Change of
Control of the Company within three (3) years after the date of grant, the
Option shall become immediately exercisable in full.
(vi) Termination of Options. Non-Qualified Stock Options granted to
Non-Employee Directors shall terminate on the earlier of:
(A) ten years after the date of grant; or
(B) twelve months after the Non-Employee Director ceases to be
a director of the Company for any reason, including as a
result of the Non-Employee Director's death, disability or
retirement.
(vii) Exercise of Options. A Non-Qualified Stock Option granted
to a Non-Employee Director may be exercised, subject to its terms and
conditions and the terms and conditions of the Plan, in full at any time or in
part from time to time by delivery to the Secretary of the Company at the
Company's principal office in West Bend, Wisconsin, of a written notice of
exercise specifying the number of shares with respect to which the Option is
being exercised. Any notice of exercise shall be accompanied by full payment
of the exercise price of the Shares being purchased (x) in cash or its
equivalent; (y) by tendering previously acquired Shares (valued at their
"market value" as determined in accordance with Section 6(b)(iv) as of the
date of exercise); or (z) by any combination of the means of payment set forth
in subparagraphs (x) and (y). For purposes of subparagraphs (y) and (z)
above, the term "previously acquired Shares" shall only include Shares owned
by the Non-Employee Director at least six months prior to the exercise of the
Option for which payment is being made and shall not include Shares which are
being acquired pursuant to the exercise of said Option. No shares will be
issued until full payment therefor has been made.
(c) Stock Appreciation Rights. The Committee is hereby authorized to
grant Stock Appreciation Rights to Key Employees. Non-Employee Directors are
not eligible to be granted Stock Appreciation Rights under the Plan. Subject
to the terms of the Plan and any applicable Award Agreement, a Stock
Appreciation Right granted under the Plan shall confer on the holder thereof a
right to receive, upon exercise thereof, the excess of (i) the Fair Market
Value of one Share on the date of exercise over (ii) the grant price of the
Stock Appreciation Right as specified by the Committee, which shall not be
less than 100% of the Fair Market Value of one Share on the date of grant of
the Stock Appreciation Right. Subject to the terms of the Plan, the grant
price, term, methods of exercise, methods of settlement (including whether the
Participating Key Employee will be paid in cash, Shares, other securities,
other Awards, or other property, or any combination thereof), and any other
terms and conditions of any Stock Appreciation Right shall be as determined by
the Committee. The Committee may impose such conditions or restrictions on
the exercise of any Stock Appreciation Right as it may deem appropriate.
(d) Restricted Stock Awards.
(i) Issuance. The Committee is hereby authorized to grant Awards
of Restricted Stock to Key Employees; provided, however, that the aggregate
number of Shares of Restricted Stock granted under the Plan to all
Participating Key Employees as a group shall not exceed 200,000 (such number
of Shares subject to adjustment in accordance with the terms of Section 4(b)
hereof). Non-Employee Directors are not eligible to be granted Restricted
Stock under the Plan.
(ii) Restrictions. Shares of Restricted Stock granted to
Participating Key Employees shall be subject to such restrictions as the
Committee may impose (including, without limitation, any limitation on the
right to vote a Share of Restricted Stock or the right to receive any dividend
or other right or property), which restrictions may lapse separately or in
combination at such time or times, in such installments or otherwise, as the
Committee may deem appropriate; provided, however, that, except as determined
by the Committee with respect to a number of Shares not exceeding 10% of the
Shares authorized for issuance under the Plan, the applicable period of
restriction for any Shares of Restricted Stock granted hereunder shall not be
less than three (3) years, subject to earlier vesting at the discretion of the
Committee in the event of death, disability or retirement of a Participating
Key Employee or in the event of a Change of Control of the Company.
(iii) Registration. Any Restricted Stock granted under the Plan
to a Participating Key Employee may be evidenced in such manner as the
Committee may deem appropriate, including, without limitation, book-entry
registration or issuance of a stock certificate or certificates. In the event
any stock certificate is issued in respect of Shares of Restricted Stock
granted under the Plan to a Participating Key Employee, such certificate shall
be registered in the name of the Participating Key Employee and shall bear an
appropriate legend (as determined by the Committee) referring to the terms,
conditions, and restrictions applicable to such Restricted Stock.
(iv) Payment of Restricted Stock. At the end of the applicable
restriction period relating to Restricted Stock granted to a Participating Key
Employee, one or more stock certificates for the appropriate number of Shares,
free of restrictions imposed under the Plan, shall be delivered to the
Participating Key Employee, or, if the Participating Key Employee received
stock certificates representing the Restricted Stock at the time of grant, the
legends placed on such certificates shall be removed.
(v) Forfeiture. Shares of Restricted Stock that do not vest
pursuant to their terms will be forfeited by the Participating Key Employee to
whom such Shares were granted.
(e) Performance Shares.
(i) Issuance. The Committee is hereby authorized to grant Awards
of Performance Shares to Participating Key Employees. Non-Employee Directors
are not eligible to be granted Performance Shares under the Plan.
(ii) Performance Goals and Other Terms. The Committee shall
determine the Performance Period, the Performance Goal or Goals (and the
performance level or levels related thereto) to be achieved during any
Performance Period, the proportion of payments, if any, to be made for
performance between the minimum and full performance levels for any
Performance Goal and, if applicable, the relative percentage weighting given
to each of the selected Performance Goals, the restrictions applicable to
Shares of Restricted Stock received upon payment of Performance Shares if
Performance Shares are paid in such manner, and any other terms, conditions
and rights relating to a grant of Performance Shares. The Committee shall
have sole discretion to alter the selected Performance Goals set forth in
Section 2(q), subject to shareholder approval, to the extent required to
qualify the Award for the performance-based exemption provided by Section
162(m) of the Code (or any successor provision thereto). Notwithstanding the
foregoing, in the event the Committee determines it is advisable to grant
Performance Shares which do not qualify for the performance-based exemption
under Section 162(m) of the Code (or any successor provision thereto), the
Committee may make such grants without satisfying the requirements thereof.
(iii) Rights and Benefits During the Performance Period. The
Committee may provide that, during a Performance Period, a Participating Key
Employee shall be paid cash amounts, with respect to each Performance Share
held by such Participating Key Employee, in the same manner, at the same time,
and in the same amount paid, as a cash dividend on a Share. Participating Key
Employees shall have no voting rights with respect to Performance Shares held
by them during the applicable Performance Period.
(iv) Payment of Performance Shares. As soon as is reasonably
practicable following the end of the applicable Performance Period, and
subject to the Committee certifying in writing as to the satisfaction of the
requisite Performance Goal or Goals if such certification is required in order
to qualify the Award for the performance-based exemption provided by Section
162(m) of the Code (or any successor provision thereto), one or more
certificates representing the number of Shares equal to the number of
Performance Shares payable shall be registered in the name of and delivered to
the Participating Key Employee; provided, however, that any Shares of
Restricted Stock payable in connection with Performance Shares shall, pending
the expiration, lapse, or waiver of the applicable restrictions, be evidenced
in the manner as set forth in Section 6(d)(iii) hereof.
(f) General.
(i) No Consideration for Awards. Awards shall be granted to
Participating Key Employees without the requirement of cash consideration
unless otherwise determined by the Committee. Awards of Non-Qualified Stock
Options granted to Non-Employee Directors under Section 6(b) of the Plan shall
be granted for no cash consideration unless otherwise required by law.
(ii) Award Agreements. Each Award granted under the Plan shall be
evidenced by an Award Agreement in such form (consistent with the terms of the
Plan) as shall have been approved by the Committee.
(iii) Awards May Be Granted Separately or Together. Awards to
Participating Key Employees under the Plan may be granted either alone or in
addition to, in tandem with, or in substitution for any other Award or any
award granted under any other plan of the Company or any Affiliate. Awards
granted in addition to or in tandem with other Awards, or in addition to or in
tandem with awards granted under any other plan of the Company or any
Affiliate, may be granted either at the same time as or at a different time
from the grant of such other Awards or awards.
(iv) Forms of Payment Under Awards. Subject to the terms of the
Plan and of any applicable Award Agreement, payments or transfers to be made
by the Company or an Affiliate upon the grant, exercise, or payment of an
Award to a Participating Key Employee may be made in such form or forms as the
Committee shall determine, and may be made in a single payment or transfer, in
installments, or on a deferred basis, in each case in accordance with rules
and procedures established by the Committee. Such rules and procedures may
include, without limitation, provisions for the payment or crediting of
interest on installment or deferred payments.
(v) Limits on Transfer of Awards. Except as otherwise provided by
the Committee, no Award (other than Released Securities), and no right under
any such Award, shall be assignable, alienable, salable, or transferable by a
Participating Key Employee or a Non-Employee Director otherwise than by will
or by the laws of descent and distribution (or, in the case of an Award of
Restricted Securities, to the Company); provided, however, that a
Participating Key Employee at the discretion of the Committee may, and a Non-
Employee Director shall, be entitled, in the manner established by the
Committee, to designate a beneficiary or beneficiaries to exercise his or her
rights, and to receive any property distributable, with respect to any Award
upon the death of the Participating Key Employee or the Non-Employee Director,
as the case may be. Except as otherwise provided by the Committee, each
Award, and each right under any Award, shall be exercisable, during the
lifetime of the Participating Key Employee or the Non-Employee Director, only
by such individual or, if permissible under applicable law, by such
individual's guardian or legal representative. Except as otherwise provided
by the Committee, no Award (other than Released Securities), and no right
under any such Award, may be pledged, alienated, attached, or otherwise
encumbered, and any purported pledge, alienation, attachment, or encumbrance
thereof shall be void and unenforceable against the Company or any Affiliate.
(vi) Term of Awards. Except as otherwise provided in the Plan, the
term of each Award shall be for such period as may be determined by the
Committee but the expiration date of an Award shall be not later than ten
years after the date such Award is granted.
(vii) Share Certificates; Representation. In addition to the
restrictions imposed pursuant to Section 6(d) and Section 6(e) hereof, all
certificates for Shares delivered under the Plan pursuant to any Award or the
exercise thereof shall be subject to such stop transfer orders and other
restrictions as the Committee may deem advisable under the Plan or the rules,
regulations, and other requirements of the Commission, any stock exchange or
other market upon which such Shares are then listed or traded, and any
applicable federal or state securities laws, and the Committee may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions. The Committee may require each Participating
Key Employee, Non-Employee Director or other Person who acquires Shares under
the Plan by means of an Award originally made to a Participating Key Employee
or a Non-Employee Director to represent to the Company in writing that such
Participating Key Employee, Non-Employee Director or other Person is acquiring
the Shares without a view to the distribution thereof.
Section 7. Amendment and Termination of the Plan; Correction of Defects
and Omissions
(a) Amendments to and Termination of the Plan. The Board of Directors
of the Company may at any time amend, alter, suspend, discontinue, or
terminate the Plan; provided, however, that shareholder approval of any
amendment of the Plan shall also be obtained: (i) if such amendment
(A) increases the number of Shares with respect to which Awards may be granted
under the Plan (other than increases related to adjustments made as provided
in Section 4(b) hereof), (B) expands the class of persons eligible to
participate under the Plan, or (C) otherwise increases in any material respect
the benefits payable under the Plan; or (ii) if otherwise required by (A) the
Code or any rules promulgated thereunder (in order to allow for Incentive
Stock Options to be granted under the Plan), or (B) the quotation or listing
requirements of the Nasdaq Stock Market or any principal securities exchange
or market on which the Shares are then traded (in order to maintain the
quotation or listing of the Shares thereon). Termination, amendment or
modification of the Plan shall not affect the rights of Participating Key
Employees or Non-Employee Directors with respect to Awards previously granted
to them, and all unexpired Awards shall continue in force and effect after
termination of the Plan except as they may lapse or be terminated by their own
terms and conditions.
(b) Correction of Defects, Omissions and Inconsistencies. The Committee
may correct any defect, supply any omission, or reconcile any inconsistency in
any Award or Award Agreement in the manner and to the extent it shall deem
desirable to carry the Plan into effect.
Section 8. General Provisions
(a) No Rights to Awards. No Key Employee, Participating Key Employee or
other Person (other than a Non-Employee Director to the extent provided in
Section 6(b) of the Plan) shall have any claim to be granted an Award under
the Plan, and there is no obligation for uniformity of treatment of Key
Employees, Participating Key Employees, or holders or beneficiaries of Awards
under the Plan. The terms and conditions of Awards need not be the same with
respect to each Participating Key Employee.
(b) Withholding. No later than the date as to which an amount first
becomes includible in the gross income of a Participating Key Employee for
federal income tax purposes with respect to any Award under the Plan, the
Participating Key Employee shall pay to the Company, or make arrangements
satisfactory to the Company regarding the payment of, any federal, state,
local or foreign taxes of any kind required by law to be withheld with respect
to such amount. Unless otherwise determined by the Committee, withholding
obligations arising with respect to Awards to Participating Key Employees
under the Plan may be settled with Shares other than Restricted Securities,
including Shares that are part of, or are received upon exercise of, the Award
that gives rise to the withholding requirement. The obligations of the
Company under the Plan shall be conditional on such payment or arrangements,
and the Company and any Affiliate shall, to the extent permitted by law, have
the right to deduct any such taxes from any payment otherwise due to the
Participating Key Employee. The Committee may establish such procedures as it
deems appropriate for the settling of withholding obligations with Shares.
(c) No Limit on Other Compensation Arrangements. Nothing contained in
the Plan shall prevent the Company or any Affiliate from adopting or
continuing in effect other or additional compensation arrangements, and such
arrangements may be either generally applicable or applicable only in specific
cases.
(d) Rights and Status of Recipients of Awards. The grant of an Award
shall not be construed as giving a Participating Key Employee the right to be
retained in the employ of the Company or any Affiliate. Further, the Company
or any Affiliate may at any time dismiss a Participating Key Employee from
employment, free from any liability, or any claim under the Plan, unless
otherwise expressly provided in the Plan or in any Award Agreement. The grant
of an Award to a Non-Employee Director pursuant to Section 6(b) of the Plan
shall confer no right on such Non-Employee Director to continue as a director
of the Company. Except for rights accorded under the Plan and under any
applicable Award Agreement, Participating Key Employees and Non-Employee
Directors shall have no rights as holders of Shares as a result of the
granting of Awards hereunder.
(e) Unfunded Status of the Plan. Unless otherwise determined by the
Committee, the Plan shall be unfunded and shall not create (or be construed to
create) a trust or a separate fund or funds. The Plan shall not establish any
fiduciary relationship between the Company and any Participating Key Employee,
any Non-Employee Director or other Person. To the extent any Person holds any
right by virtue of a grant under the Plan, such right (unless otherwise
determined by the Committee) shall be no greater than the right of an
unsecured general creditor of the Company.
(f) Governing Law. The validity, construction and effect of the Plan
and any rules and regulations relating to the Plan shall be determined in
accordance with the laws of the State of Wisconsin and applicable federal law.
(g) Severability. If any provision of the Plan or any Award Agreement
or any Award is or becomes or is deemed to be invalid, illegal, or
unenforceable in any jurisdiction, or as to any Person or Award, or would
disqualify the Plan, any Award Agreement or any Award under any law deemed
applicable by the Committee, such provision shall be construed or deemed
amended to conform to applicable laws, or if it cannot be so construed or
deemed amended without, in the determination of the Committee, materially
altering the intent of the Plan, any Award Agreement or the Award, such
provision shall be stricken as to such jurisdiction, Person, or Award, and the
remainder of the Plan, any such Award Agreement and any such Award shall
remain in full force and effect.
(h) No Fractional Shares. No fractional Shares or other securities
shall be issued or delivered pursuant to the Plan, any Award Agreement or any
Award, and the Committee shall determine (except as otherwise provided in the
Plan) whether cash, other securities, or other property shall be paid or
transferred in lieu of any fractional Shares or other securities, or whether
such fractional Shares or other securities or any rights thereto shall be
canceled, terminated, or otherwise eliminated.
(i) Headings. Headings are given to the Sections and subsections of the
Plan solely as a convenience to facilitate reference. Such headings shall not
be deemed in any way material or relevant to the construction or
interpretation of the Plan or any provision thereof.
Section 9. Effective Date of the Plan
The Plan shall be effective on the date of adoption of the Plan by the
Board of Directors of the Company provided that the Plan is approved by the
shareholders of the Company within twelve months following the date of
adoption of the Plan by the Board of Directors. All Awards granted prior to
shareholder approval of the Plan shall be subject to such approval and shall
not be exercisable until after such approval.
<PAGE>
Gehl Company
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints William D. Gehl and Michael J. Mulcahy, or
either of them (with full power of substitution in each of them), as Proxies
and hereby authorizes them to represent and to vote as designated below all of
the shares of Common Stock of Gehl Company held of record by the undersigned
on February 18, 2000 at the annual meeting of shareholders to be held on April
20, 2000, or any adjournment or postponement thereof.
This proxy when properly executed will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made, this proxy will be
voted "FOR" the election of the Board's nominees and "FOR" approval of the
Gehl Company 2000 Equity Incentive Plan.
DETACH BELOW AND RETURN USING THE ENVELOPE PROVIDED
GEHL COMPANY 2000 ANNUAL MEETING
1. ELECTION OF DIRECTORS
(terms expiring at the 2003 Annual Meeting)
1-John T. Byrnes 2-Richard J. Fotach
3-Hermann Viets
____ FOR all nominees ____ WITHHOLD AUTHORITY
listed to the left to vote for all nominees
(except as specified below). listed to the left.
(Instructions: To withhold authority to vote for any indicated nominee, write
the number(s) of the nominee(s) in the box provided to the right.) __________
2. Approval of the Gehl Company 2000 Equity Incentive Plan
____ FOR ____ AGAINST ____ ABSTAIN
3. IN THEIR DISCRETION THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
Date _____________ No. of shares ____________
Check appropriate box
Indicate changes below:
Address Change? ____ Name Change? ____
_____________________________________________________________
_____________________________________________________________
Signature(s) in Box
Please sign exactly as name appears hereon. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
<PAGE>
