Deferred Long-Term Incentive Plan - Harley-Davidson Inc. and Jeffrey Bleustein
Deferred Long-Term Incentive Plan (the "Plan")
1. General. Mr. Bleustein will be entitled to receive up to $5,000,000 in the
aggregate under the Plan (excluding the investment component discussed
below) in respect of performance during years 2002 through 2006.
(a) Subject to the maximum $5,000,000 aggregate award ("Maximum Aggregate
Award"), there is no maximum amount that Mr. Bleustein may receive
under the Plan in respect of any year.
2. Goals. Mr. Bleustein's entitlement to all or any portion of the Maximum
Aggregate Award will be contingent upon performance relative to goals
focusing on Company performance and/or individual performance.
(a) The Human Resources Committee (the "Committee") will, in its
discretion, establish the goals, determine the level of performance
relative to the goals and determine the amount, if any, of the Maximum
Aggregate Award to which Mr. Bleustein is entitled based on that
(b) The goals may be subjective or objective in nature.
(c) The Committee will establish the goals and communicate them to Mr.
Bleustein at its discretion.
(d) At any time, and from time to time, the Committee will determine the
level of performance relative to goals it has established and the
amount, if any, of the Maximum Aggregate Award to which Mr. Bleustein
is entitled and promptly communicate its determination to Mr.
3. Accounting / Investment. The Company will establish a bookkeeping account
for Mr. Bleustein for purposes of the Plan (the "Account") the initial
balance of which is zero (0).
(a) At such time as the Committee determines that Mr. Bleustein is
entitled to all or any portion of the Maximum Aggregate Award, the
Company shall credit to the Account the amount that the Committee has
so determined. The credit shall be deemed made as of the date of the
Committee's determination or such other date that the Committee
(b) In addition, as of the end of each calendar quarter, the Company shall
credit the Account with an amount equal to the product of (i) the
average month-end Account balance over the course of that quarter and
(ii) Moody's Long Term Bond Rate (the "Interest Rate") for the year
applied on a quarterly basis.
4. Payment. As soon as practicable after commencement of the Company's taxable
year following the taxable year in which Mr. Bleustein ceases to be an
employee of the Company (or, if remuneration to Mr. Bleustein would be
subject to the limitation set forth
in Section 162(m) of the Internal Revenue Code as a result of payment at
such time, then on the earliest later date on which the Company may make
such payment such that no remuneration to Mr. Bleustein would be subject to
such limitation), the Company shall pay to Mr. Bleustein, in cash, the
amount of the balance in the Account.
(a) Mr. Bleustein may elect, prior to January 1 of the year payments under
the Plan are otherwise to commence, to receive payment in either equal
[annual] installments up to a maximum of fifteen (15) years or in a
single lump sum cash payment. Mr. Bleustein may similarly change his
benefit payment election at any time prior to January 1 of the year
payments under the Plan are otherwise to commence. If no valid
election is in effect, then payment of the Account shall be made in a
(b) If payment is made in installments, then the amount to be distributed
annually is determined by multiplying the aggregate balance of the
Account by a fraction, the numerator of which is one (1) and the
denominator of which is the number of years remaining for the payments
to be made (e.g., 1/10, 1/9, 1/8 etc.). Additional earnings are to be
credited to the Account during the installment payment period in the
same way earnings are credited while Mr. Bleustein is employed. In the
event of Mr. Bleustein's death before payment in full is completed,
any remaining amount will be paid to his designated beneficiary, or as
otherwise provided in paragraph 7(d), in accordance with the payment
method in effect at death. The recipient may elect lump sum payment
subject to Committee consent.
5. Termination of Employment Due to Death or Disability. Upon Mr. Bleustein's
death or disability prior to termination of employment, and before any
payments have been made, the Company will pay to Mr. Bleustein or his
designated beneficiary, or as otherwise provided in paragraph 7(d), as
compensation for services rendered prior to the date of his death or
disability, a benefit equal to the balance in the Account measured as of
the date his death or disability occurred.
6. Change in Control. The aggregate balance of the Account (whether he remains
employed, his employment is terminated, or the Account is in payment
status) shall be paid out to Mr. Bleustein within ten (10) business days
after the occurrence of a Change of Control Event (as such term is defined
in the Company's Deferred Compensation Plan). If payment is delayed beyond
such payment deadline for any reason, then the balance to be paid out shall
become fixed as of such tenth (10th) day, except that such amount shall be
increased in an amount equivalent to interest on such fixed amount, to the
date of actual payment, at a rate equal to two times the Interest Rate.
(a) The Company may deduct from non-deferred compensation any taxes it is
required to withhold on amounts credited to the Account unless such
amounts are withheld directly from the amount credited to the Account.
The Company will withhold from all payments all required taxes.
(b) The Account is a means of measuring the value of Mr. Bleustein's
compensation under the Plan. The Account does not create a trust fund
of any kind. Any assets earmarked by the Company to pay benefits under
the Plan do at all times remain assets of the Company. Mr. Bleustein
has no property interest in specific assets of the Company because of
the Plan. The rights of Mr. Bleustein, his beneficiary, or an estate
to benefits under the Plan shall be solely those of an unsecured
creditor of the Company.
(c) Following the close of each year the Company will provide a statement
of account to Mr. Bleustein. The Account shall be maintained,
reported, and distributed in United States Dollars.
(d) All payments by the Company will be made to Mr. Bleustein, if he is
living. If Mr. Bleustein has died, then any payment under the Plan
will be made to his designated beneficiary, which may include multiple
beneficiaries. If such beneficiary dies before receiving all payments
due such beneficiary, then any remaining payments will be made to the
designated beneficiary's estate unless a contingent beneficiary was
designated by Mr. Bleustein as to such amounts. If there is a
contingent beneficiary, then payments will be made to the contingent
beneficiary, and if such contingent beneficiary dies, then any
remaining payments will be made to the contingent beneficiary's
estate. If there is no beneficiary designation in force when amounts
become payable upon Mr. Bleustein's death, then payment shall be to
Mr. Bleustein's spouse, or if no spouse is then living, to Mr.
(e) The right of Mr. Bleustein to payment under the Plan shall not be
assigned, transferred, pledged, or encumbered.
(f) The Plan may not be construed as giving Mr. Bleustein the right to be
retained as an employee of the Company or any of its subsidiaries or
8. 401(k) Matching Contribution Make Up Amounts. The Company will not credit
to the Account a Company matching contribution on amounts credited to the
Account under paragraph 3(a) in the same relative amount as is made to Mr.
Bleustein's pretax savings account in the Harley-Davidson Retirement
Savings Plan on amounts Mr. Bleustein has elected to defer under that plan.
9. Status Under SERP and Pension Benefit Restoration Plan. Amounts credited to
the Account under paragraph 3(a) shall be included in the determination of
"earnings" and "Final Average Earnings" under the Supplemental Executive
Retirement Plan and Pension Benefit Restoration Plan in effect for Mr.
Bleustein as amounts "contributed as a pretax contribution to a
nonqualified plan of deferred compensation maintained by" the Company, with
such contribution deemed to occur as of the date of the credit.