HNI CORPORATION EXECUTIVE DEFERRED COMPENSATION PLAN DEFERRAL ELECTION AGREEMENT Applies Only to Compensation Earned in, or for Performance Periods Beginning in, _____
Exhibit
10.25
HNI
CORPORATION
EXECUTIVE
DEFERRED COMPENSATION PLAN
Applies
Only to Compensation Earned in, or for Performance Periods Beginning in,
_____
This Deferral Election Agreement (this
"Agreement") is made by and between HNI Corporation (the "Corporation") and
_____________________________ (print name) (the "Member")
on the date below. The Corporation has established a nonqualified
deferred compensation plan, the HNI Corporation Executive Deferred Compensation
Plan (the "Plan"), for the benefit of certain members of the Corporation who are
eligible to participate in the Plan according to the terms of the Plan
document. The Plan permits an eligible member to defer a percentage
of his/her Base Salary, as well as his/her compensation under the HNI
Corporation Annual Incentive Plan ("AIP") and HNI Corporation Supplemental
Income Plan ("SIP") (collectively, "Compensation"). The deferral for
the Plan year commencing ______________ (the
"Current Election Year") is made by entering into this Agreement with the
Corporation. Capitalized terms used but not defined in this Agreement
have the meaning given in the Plan.
The Corporation and the Member agree as
follows:
1. Compensation Reduction
Election. The Corporation will reduce the amount of the
Member's Base Salary otherwise payable to the Member in the Current Election
Year, and/or the amount payable to him/her under the AIP and SIP for services
performed in the Current Election Year and will credit these amounts to the
Member's Account under the Plan according to the Member's elections in Section 4
below.
2. Accounts. The
Corporation will maintain two Accounts under the Plan, the Cash Account and the
Stock Account. The Cash Account will be credited with interest at
Prime Rate plus one percentage point. The Stock Account will be held
in stock units. Each stock unit will be equal to a share of common
stock of the Corporation ("Stock") and will be credited with reinvested
dividends as if actually held in the form of Stock. The Member may
elect to have any Compensation (permitted to be deferred under this Agreement)
that otherwise (but for this Agreement) would have been paid to the Member in
the form of cash, credited to the Stock Account and held in the form of stock
units or credited to the Cash Account. Compensation deferred under
this Agreement that would otherwise be paid to the Member in the form of Stock
will automatically be credited to the Stock Account and held in stock
units.
3. Manner of Distribution of
Accounts. All distributions from the Cash Account will be made
in cash. All distributions from the Stock Account will be made in
Stock. The Member may elect when and how amounts credited under this
Agreement will be distributed. Distributions may be made in a single
lump sum or substantially equal annual installments over a period of years, as
elected by the Member.
i.
Base
Salary
The
Member elects to defer that portion of Base Salary otherwise payable to him/her
in cash for services performed by the Member in the Current Election Year to be
credited to the Member's Cash Account and/or Stock Account as
follows:
Cash
Account: _____% (Insert percent) of total
Base Salary
Stock
Account: _____% (Insert percent) of total
Base Salary
(together,
can be no more than 100%)
ii.
AIP
Compensation
1) Deferral from
Cash Compensation. The Member elects to defer that portion of
AIP Compensation otherwise payable to him/her in cash for services performed in
the Current Election Year to be credited to the Member's Cash Account and/or
Stock Account as follows:
Cash
Account: _____% (Insert percent)
Stock
Account: _____% (Insert percent)
(together,
can be no more than 100%)
2) Deferral from
Stock Compensation. The Member elects
to defer that portion of AIP Compensation otherwise payable to him/her in Stock
for services performed in the Current Election Year to be credited to the
Member's Stock Account as follows:
Stock
Account: _____% (Insert percent)
iii. SIP
Compensation
1) Deferral from
Cash Compensation. The Member elects to defer that portion of
SIP Compensation otherwise payable to him/her in cash for services performed in
the Current Election Year to be credited to the Member's Cash Account and/or
Stock Account as follows:
Cash
Account: _____% (Insert percent)
Stock
Account: _____% (Insert percent)
(together,
can be no more than 100%)
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2) Deferral from
Stock Compensation. The Member elects
to defer that portion of SIP Compensation otherwise payable to him/her in Stock
for services performed in the Current Election Year to be credited to the
Member's Stock Account as follows:
Stock
Account: _____% (Insert percent)
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b.
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When/How
Distributions Are Made
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Distribution
from the Cash Account will be made in the form of cash. Distributions
from the Stock Account will be made in the form of Stock, which will be
delivered to the Corporation's transfer agent and placed in a direct
registration account in the Member's name unless the Member notifies the
Corporation in sufficient time to coordinate a different share delivery
method. All distributions from the Plan will be made on the 3rd
Monday of January. Distributions from both
the Cash Account and the Stock Account will be made as follows:
i.
Distribution
Date: [Select one]
o Separation
from Service
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o
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Commencement
date: Distribution from the Cash Account and/or Stock Account
will commence in _____. [Specify year in which
distributions will begin, may be no earlier than
_____.]
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ii.
Form
of Distribution: [Select one]
o Lump
sum
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o
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Substantially
equal annual installments over ___ [Insert number, not to exceed
15] years
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Note: You may change the
time and form of distribution of an Account only under limited circumstances,
generally requiring an additional 5-year deferral of your benefit commencement
date.
The Corporation reserves the right to
amend the Plan in any manner and to terminate the Plan and, to the extent
permitted by Section 409A of the Internal Revenue Code and other applicable law,
require an immediate distribution of all Accounts.
5. The
above deferral elections are based on the assumption the Corporation will
continue its established practice of paying:
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100%
of the AIP award in cash; and
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·
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100%
of the SIP award in Stock.
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If any of the above Compensation items
should be paid according to a different method (for example, 100% of the AIP
award is actually paid in Stock), the Corporation will adjust the amount
deferred in Stock or cash (as the case may be) under this Agreement so the
dollar amount of the total deferral is the same as if the Corporation paid
Compensation according to the established practice described above.
6. The
Member understands this Agreement is subject to all of the terms and conditions
of the Plan and acknowledges the Member has either read, or been given the
opportunity to read, the Plan. In particular, the Member understands
there are some exceptions to the payment terms described above. For
example, if the Member Separates from Service for reasons other than Retirement,
payment of the Member's Account will generally be made in a lump sum at
Separation from Service, and a single lump-sum distribution will be made in the
event of a Change in Control.
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7. The
Member understands if he or she is a "specified employee" within the meaning of
Section 409A of the Internal Revenue Code, any distribution that is otherwise to
begin on his or her Separation from Service will be delayed for six months to
comply with applicable tax law.
8. The
Member acknowledges that in making the decision to defer Compensation under the
Plan, the Member has not relied upon any financial or tax advice provided by the
Corporation, and the Member understands the Corporation has not received a
ruling or determination from the Internal Revenue Service as to the effect of
the deferral on the Member's income or employment tax liability.
9. Except
as permitted by the Plan and applicable law or deemed advisable by the
Corporation in order to preserve the intended tax consequences of the Plan, this
Agreement, once made, may not be revoked. It is binding upon, and
will inure to the benefit of, the Member, the Member's beneficiaries, heirs and
personal representatives, the Corporation and its successors and
assigns.
Dated this ___ day of
_________________, _____.
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MEMBER:
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Received and accepted by HNI
Corporation this _______ day of_________________, _____.
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HNI
Corporation
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By:
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Name:
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Title:
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