


<PAGE>


















                               POLARIS INDUSTRIES INC.

                            EMPLOYEE STOCK OWNERSHIP PLAN

                              EFFECTIVE JANUARY 1, 1997

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                                  TABLE OF CONTENTS


ARTICLE I

INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1

ARTICLE II

DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1
     2.01   Account . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1
     2.02   Affiliated Company. . . . . . . . . . . . . . . . . . . . . . .   1
     2.03   Anniversary Date. . . . . . . . . . . . . . . . . . . . . . . .   2
     2.04   Annual Addition . . . . . . . . . . . . . . . . . . . . . . . .   2
     2.05   Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . .   2
     2.06   Board of Directors. . . . . . . . . . . . . . . . . . . . . . .   2
     2.07   Break in Continuous Service . . . . . . . . . . . . . . . . . .   2
     2.08   Capital Accumulation. . . . . . . . . . . . . . . . . . . . . .   2
     2.09   Code. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   2
     2.10   Committee . . . . . . . . . . . . . . . . . . . . . . . . . . .   2
     2.11   Company . . . . . . . . . . . . . . . . . . . . . . . . . . . .   2
     2.12   Company Stock . . . . . . . . . . . . . . . . . . . . . . . . .   2
     2.13   Company Stock Account . . . . . . . . . . . . . . . . . . . . .   2
     2.14   Compensation. . . . . . . . . . . . . . . . . . . . . . . . . .   2
     2.15   Continuous Service. . . . . . . . . . . . . . . . . . . . . . .   3
     2.16   Direct Rollover . . . . . . . . . . . . . . . . . . . . . . . .   3
     2.17   Distributee . . . . . . . . . . . . . . . . . . . . . . . . . .   3
     2.18   Election Period . . . . . . . . . . . . . . . . . . . . . . . .   3
     2.19   Eligible Diversification Amount . . . . . . . . . . . . . . . .   3
     2.20   Eligible Retirement Plan. . . . . . . . . . . . . . . . . . . .   3
     2.21   Eligible Rollover Distribution. . . . . . . . . . . . . . . . .   4
     2.22   Employee. . . . . . . . . . . . . . . . . . . . . . . . . . . .   4
     2.23   Employer. . . . . . . . . . . . . . . . . . . . . . . . . . . .   4
     2.24   Employer Contributions. . . . . . . . . . . . . . . . . . . . .   4
     2.25   Employer Securities . . . . . . . . . . . . . . . . . . . . . .   4
     2.26   Enrollment Date . . . . . . . . . . . . . . . . . . . . . . . .   4
     2.27   ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   4
     2.28   Highly Compensated Employee . . . . . . . . . . . . . . . . . .   4
     2.29   Hour of Service . . . . . . . . . . . . . . . . . . . . . . . .   5
     2.30   Loan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     2.31   Non-Highly Compensated Employee . . . . . . . . . . . . . . . .   6
     2.32   Other Investments Account . . . . . . . . . . . . . . . . . . .   6


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     2.33   Participant . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     2.34   Plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     2.35   Plan Year . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     2.36   Qualified Participant . . . . . . . . . . . . . . . . . . . . .   6
     2.37   Retirement. . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     2.38   Section 414(s) Compensation . . . . . . . . . . . . . . . . . .   6
     2.39   Suspense Account. . . . . . . . . . . . . . . . . . . . . . . .   6
     2.40   Total Distribution. . . . . . . . . . . . . . . . . . . . . . .   6
     2.41   Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   7
     2.42   Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . .   7
     2.43   Trust Assets. . . . . . . . . . . . . . . . . . . . . . . . . .   7
     2.44   Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . .   7
     2.45   Year of Eligibility Service . . . . . . . . . . . . . . . . . .   7

ARTICLE III

ELIGIBILITY AND PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . .   7
     3.01   Eligibility for Participation . . . . . . . . . . . . . . . . .   7
     3.02   Reemployment of Participant . . . . . . . . . . . . . . . . . .   8

ARTICLE IV

EMPLOYEE CONTRIBUTIONS. . . . . . . . . . . . . . . . . . . . . . . . . . .   8

ARTICLE V

EMPLOYER CONTRIBUTIONS. . . . . . . . . . . . . . . . . . . . . . . . . . .   8
     5.01   Employer Contributions. . . . . . . . . . . . . . . . . . . . .   8

ARTICLE VI

INVESTMENT OF TRUST ASSETS. . . . . . . . . . . . . . . . . . . . . . . . .   9
     6.01   Investment of Trust Assets. . . . . . . . . . . . . . . . . . .   9
     6.02   Diversification . . . . . . . . . . . . . . . . . . . . . . . .  10
     6.03   Exempt Loan . . . . . . . . . . . . . . . . . . . . . . . . . .  10

ARTICLE VII

ALLOCATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
     7.01   Allocations to Participants' Accounts . . . . . . . . . . . . .  13
     7.02   Allocable Shares. . . . . . . . . . . . . . . . . . . . . . . .  14
     7.03   Allocation Limitations. . . . . . . . . . . . . . . . . . . . .  15
     7.04   Allocation of Net Income (or Loss) of the Trust . . . . . . . .  16


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     7.05   Accounting for Allocations. . . . . . . . . . . . . . . . . . .  16
     7.06   Nonallocation . . . . . . . . . . . . . . . . . . . . . . . . .  17

ARTICLE VIII

EXPENSES OF THE PLAN AND TRUST. . . . . . . . . . . . . . . . . . . . . . .  17

ARTICLE IX

VOTING COMPANY STOCK AND EXERCISE OF OTHER RIGHTS . . . . . . . . . . . . .  17
     9.01   Voting and Tender or Exchange Rights. . . . . . . . . . . . . .  17

ARTICLE X

CAPITAL ACCUMULATION. . . . . . . . . . . . . . . . . . . . . . . . . . . .  22

ARTICLE XI

DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22
     11.01  Time of Distribution to Participants. . . . . . . . . . . . . .  22
     11.02  Benefit Forms for Participants. . . . . . . . . . . . . . . . .  22
     11.03  Benefit Form on a Participant's Death . . . . . . . . . . . . .  23
     11.04  Distribution in Company Stock . . . . . . . . . . . . . . . . .  23
     11.05  Delay in Benefit Determination. . . . . . . . . . . . . . . . .  23
     11.06  Designated Beneficiaries. . . . . . . . . . . . . . . . . . . .  23
     11.07  Additional Distribution Requirements. . . . . . . . . . . . . .  24
     11.08  Distributions Pursuant to Qualified Domestic Relations Orders .  25

ARTICLE XII

DETERMINATION OF SERVICE
     12.01  Continuous Service. . . . . . . . . . . . . . . . . . . . . . .  28
     12.02  Break in Continuous Service . . . . . . . . . . . . . . . . . .  28
     12.03  Affiliated Companies. . . . . . . . . . . . . . . . . . . . . .  29

ARTICLE XIII

PLAN ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . .  29
     13.01  Named Fiduciaries . . . . . . . . . . . . . . . . . . . . . . .  29
     13.02  Fiduciary Limitations . . . . . . . . . . . . . . . . . . . . .  30
     13.03  Company Responsibilities. . . . . . . . . . . . . . . . . . . .  30
     13.04  Trustee Responsibilities. . . . . . . . . . . . . . . . . . . .  30
     13.05  Appointment of Committee. . . . . . . . . . . . . . . . . . . .  30


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     13.06  Organization and Powers of the Committee. . . . . . . . . . . .  31
     13.07  Indemnification . . . . . . . . . . . . . . . . . . . . . . . .  32

ARTICLE XIV

AMENDMENT AND TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . .  33
     14.01  Company's Right to Amend. . . . . . . . . . . . . . . . . . . .  33
     14.02  Mandatory Amendments. . . . . . . . . . . . . . . . . . . . . .  33
     14.03  Termination . . . . . . . . . . . . . . . . . . . . . . . . . .  34
     14.04  Employee Nonforfeitable Rights. . . . . . . . . . . . . . . . .  34
     14.05  Distribution upon Termination . . . . . . . . . . . . . . . . .  34

ARTICLE XV

GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .  34
     15.01  Participants' Rights. . . . . . . . . . . . . . . . . . . . . .  34
     15.02  Spendthrift Clause. . . . . . . . . . . . . . . . . . . . . . .  35
     15.03  Company's Liability . . . . . . . . . . . . . . . . . . . . . .  35
     15.04  Merger or Consolidation . . . . . . . . . . . . . . . . . . . .  35
     15.05  Governing Law . . . . . . . . . . . . . . . . . . . . . . . . .  35
     15.06  Legal Action. . . . . . . . . . . . . . . . . . . . . . . . . .  35
     15.07  Binding on All Parties. . . . . . . . . . . . . . . . . . . . .  35
     15.08  Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . .  35
     15.09  Severability of Provisions. . . . . . . . . . . . . . . . . . .  36
     15.10  Service of Process. . . . . . . . . . . . . . . . . . . . . . .  36

ARTICLE XVI

TOP-HEAVY COMPLIANCE PROVISIONS
     16.01  Definitions . . . . . . . . . . . . . . . . . . . . . . . . . .  36
     16.02  Definitions . . . . . . . . . . . . . . . . . . . . . . . . . .  36
     16.03  Determination of Whether Plan is "Top-Heavy." . . . . . . . . .  37
     16.04  Aggregation Group of Employer Plans . . . . . . . . . . . . . .  37
     16.05  Special Minimum Contribution Becoming Operative in the
            Event the Plan Becomes "Top-Heavy." . . . . . . . . . . . . . .  38
     16.06  Pre-"Top-Heavy" Plan Terminated Participant . . . . . . . . . .  38
     16.07  Special "Top-Heavy" Reduction in Combined Benefit
            and Contribution Limitation . . . . . . . . . . . . . . . . . .  38
     16.08  Termination of "Top-Heavy" Status . . . . . . . . . . . . . . .  39
     16.09  Multiple "Top-Heavy" Plans. . . . . . . . . . . . . . . . . . .  39
     16.10  Effect of the Plan Becoming "Super Top-Heavy" . . . . . . . . .  39

ARTICLE XVII


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DIRECT ROLLOVER AND ELIGIBLE ROLLOVER DISTRIBUTIONS . . . . . . . . . . . .  39

ARTICLE XVII

EXECUTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   39
                                      ARTICLE I

                                     INTRODUCTION

          The purposes of the Plan are to enable participating Employees to
share in the growth and prosperity of the Company and to provide Participants
with an opportunity to accumulate capital for their future economic security.
Accordingly, Plan assets will be invested primarily in Employer Securities and
up to one hundred (100) percent of the Plan assets may be invested in Company
Stock.

          The Plan is intended to be a stock bonus plan qualified under Section
401(a) of the Code, which constitutes an employee stock ownership plan within
the meaning of Section 4975(e)(7) of the Code and Section 407(d)(6) of ERISA.

          All Trust Assets acquired under the Plan as a result of Employer
Contributions and other additions to the Trust will be administered,
distributed, and otherwise governed by the provisions of the Plan.  All such
assets will be held in the Trust by the Trustee in accordance with the
provisions of the Trust Agreement.  The Plan shall be administered by the
Committee for the exclusive benefit of Participants and their Beneficiaries.


                                      ARTICLE II

                                     DEFINITIONS

          In the Plan, whenever the context so requires, the singular or plural
and the masculine, feminine or neuter gender shall each be deemed to include the
others; the terms "he," "his" and "him" shall refer to an Employee or a
Participant; references to a section of the Code, the Treasury Regulations, the
Labor Regulations or ERISA shall include any subsequent amendments to such
section; and capitalized terms shall have the following meanings:

          2.01  ACCOUNT.  One of the bookkeeping accounts maintained to record
the allocated interest of each Participant in the Plan.  Such Accounts shall
include Company Stock Accounts and Other Investments Accounts.

          2.02  AFFILIATED COMPANY.  Any corporation that is, along with the
Company, a member of a controlled group of corporations (within the meaning of
Section 414(b) of the



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Code) or any other trade or business (whether or not incorporated) which is
under common control with the Company (as defined in Section 414(c) of the Code)
or any member of an "affiliated service group" (as such term is defined in
Section 414(m) of the Code) of which the Company is also a member or as may be
provided in regulations under Section 414(o) of the Code.  For purposes of
Section 7.03, the preceding references to Sections 414(b) and 414(c) of the Code
shall be modified by Section 415(h) of the Code.

          2.03  ANNIVERSARY DATE.  The last day of each Plan Year and such
interim dates as the Committee shall determine from time to time.

          2.04  ANNUAL ADDITION.  For any Plan Year, the (a) Employer
Contributions, if any, allocated to a Participant's Accounts under the Plan and
(b) employer contributions and forfeitures allocated to a Participant's accounts
under all other defined contribution plans maintained by the Company or an
Affiliated Company.  Notwithstanding the foregoing, if no more than one-third
(1/3) of Employer Contributions for a Plan Year are allocated to the group of
Highly Compensated Employees, Annual Additions shall not include Employer
Contributions applied to the repayment of interest on a Loan of Employer
Securities acquired with the proceeds of a Loan.

          2.05  BENEFICIARY.  The person (or persons) designated under Section
11.06 as entitled to receive any benefits under the Plan in the event of a
Participant's death.

          2.06  BOARD OF DIRECTORS.  The Board of Directors of the Company.

          2.07  BREAK IN CONTINUOUS SERVICE.  A Break in Continuous Service
determined pursuant to Section 12.02.

          2.08  CAPITAL ACCUMULATION.  A Participant's vested (nonforfeitable)
interest in his Accounts under the Plan as described in Article X.

          2.09  CODE.  The Internal Revenue Code of 1986, as amended from time
to time.

          2.10  COMMITTEE.  The Committee consisting of such persons appointed
by the Board of Directors to administer the Plan and to give instructions to the
Trustee.

          2.11  COMPANY.  Polaris Industries Inc. and any corporation which
shall be its successor.

          2.12  COMPANY STOCK.  Any qualifying employer security within the
meaning of Section 407(d)(5) of ERISA and regulations thereunder including any
share of stock, common or preferred, issued by the Company or an Affiliated
Company.


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          2.13  COMPANY STOCK ACCOUNT.  An Account of a Participant which is
credited with his allocable share of Company Stock purchased and paid for by the
Trust or contributed or transferred to the Trust.

          2.14  COMPENSATION.  The total amount of compensation that is paid by
the Employer to an Employee for services rendered in the course of employment
and that is includable in such Employee's gross income for the Plan Year.
Compensation shall include salary reduction contributions to a Cafeteria plan or
cash or deferred 401(k) plan sponsored by an Employer.  Notwithstanding the
foregoing, compensation shall not include any profit sharing or any other
incentive or extraordinary compensation or compensation paid with respect to a
Participant's disability.  The maximum amount of Compensation that may be taken
into account for any Plan Year shall not exceed $150,000 (or such greater amount
as shall be provided pursuant to Section 401(a)(17) of the Code).

          2.15  CONTINUOUS SERVICE.  Continuous Service determined pursuant to
Article XII.

          2.16  DIRECT ROLLOVER.  A payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.

          2.17  DISTRIBUTEE.  An Employee or former Employee.  In addition, the
Employee's or former Employee's surviving spouse and the Employee's or former
Employee's spouse or former spouse who is the Alternate Payee under a Qualified
Domestic Relations Order, as such terms are defined in Section 414(p) of the
Code and Section 11.08(c) of the Plan, are Distributees with regard to the
interest of the spouse or former spouse.

          2.18  ELECTION PERIOD.  A Qualified Participant's Election Period
shall be the six (6) Plan Year period beginning with the Plan Year in which the
Participant attains age fifty-five (55); provided, however, that if the
Participant has not completed ten (10) years of Plan participation by the Plan
Year in which age fifty-five (55) is attained, the Election Period with respect
to such Participant shall be the six (6) Plan Year period beginning with the
Plan Year in which the Participant completes ten (10) years of Plan
participation.

          2.19  ELIGIBLE DIVERSIFICATION AMOUNT.  For any Plan Year during the
Election Period of a Qualified Participant, that portion of the Qualified
Participant's Accounts equal to the product of (a), (b), (c) and (d):

          (a)   the number of shares of Company Stock allocated to such
Qualified Participant's Accounts as of the Anniversary Date of the immediately
preceding Plan Year;

          (b)   plus the number of shares of Company Stock, if any, previously
elected to be diversified pursuant to Section 6.02;


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          (c)   such sum multiplied by .25 or, in the case of the last year in
such Qualified Participant's Election Period, .50; and

          (d)   less the number of shares of Company Stock, if any, previously
elected to be diversified pursuant to Section 6.02.

          2.20  ELIGIBLE RETIREMENT PLAN.  An individual retirement account
described in Section 408(a) of the Code, an individual retirement annuity
described in Section 408(b) of the Code, an annuity plan described in
Section 403(a) of the Code or a qualified trust described in Section 401(a) of
the Code that accepts the Distributee's Eligible Rollover Distribution;
provided, however, that in the case of an Eligible Rollover Distribution to a
surviving spouse, an Eligible Retirement Plan only means an individual
retirement plan or individual retirement annuity.

          2.21  ELIGIBLE ROLLOVER DISTRIBUTION.  Any distribution of all or any
portion of the balance of a Participant's Accounts to the credit of the
Distributee, except that an Eligible Rollover Distribution does not include:
any distribution that is one of a series of substantially equal periodic
payments (made not less frequently than annually) made for the life (or life
expectancy) of such Distributee or the joint lives (or joint life expectancies)
of such Distributee and such Distributee's designated Beneficiary or for a
specified period of ten (10) years or more; any distribution to the extent such
distribution is required under Section 401(a)(9) of the Code; and the portion of
any distribution that is not includable in gross income (determined without
regard to the exclusion for net unrealized appreciation with respect to Employer
Securities).

          2.22  EMPLOYEE.  Any person who is employed by the Employer on an
employer-employee basis.  "Employee" shall also include any "leased employee"
within the meaning of Section 414(n)(2) or 414(o)(2) of the Code, unless such
leased employee is covered by a plan described in Section 414(n)(5) of the Code
and all such leased employees do not constitute more than twenty (20) percent of
the combined non-highly compensated workforce (within the meaning of Section
414(n)(5)(C)(ii) of the Code) of the Company and Affiliated Companies.

          2.23  EMPLOYER.  The Company or any Affiliated Company which has
adopted the Plan and which has agreed to be bound by the terms of the Plan and
Trust Agreement.  Except where the context clearly provides otherwise, any
reference in the Plan to the term "Company" shall also mean any Employer with
respect to its Employees only, as though the term "Employer" was substituted for
the term "Company."

          2.24  EMPLOYER CONTRIBUTIONS.  Employer Contributions made to the
Trust pursuant to Section 5.01.


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          2.25  EMPLOYER SECURITIES.  Shares of Company Stock which meet the
requirements of Section 409(l) of the Code.

          2.26  ENROLLMENT DATE.  January 1 of the Plan Year.

          2.27  ERISA.  The Employee Retirement Income Security Act of 1974, as
amended from time to time.

          2.28  HIGHLY COMPENSATED EMPLOYEE.  Any individual who with respect
to a Plan Year:

          (a)   was a five-percent owner (as defined by Section 416(i)(1) of
the Code) at any time during such Plan Year or the preceding Plan Year; or

          (b)   for the Plan Year preceding such Plan Year:

          (1)   had Section 414(s) Compensation from the Company in excess of
                $80,000 (as such amount may be adjusted from time to time
                pursuant to Sections 414(q) and 415(d) of the Code), and

          (2)   to the extent elected by the Company with respect to such
                preceding Plan Year was in the top-paid group of Employees for
                such preceding Plan Year.

For purposes of this Section 2.28, the "top-paid group of Employees" for a Plan
Year shall be the group consisting of the top twenty percent of the Company's
Employees when ranked on the basis of Section 414(s) Compensation paid during
such Plan Year; provided, however, that the following Employees shall be
excluded from the top-paid group of Employees: (i) Employees who have not
completed six months of Continuous Service; (ii) Employees who normally work
less than 17-1/2 hours per week; (iii) Employees who normally work during not
more than six months during any Plan Year, (iv) Employees who have not attained
age 21, and (v) except to the extent otherwise provided by regulations of the
Secretary of the Treasury, Employees covered by a collective bargaining
agreement between Employee representatives and the Employer, as determined by
the Secretary of Labor.

          A former Employee shall be treated as a Highly Compensated Employee if
(i) such Employee was a Highly Compensated Employee when such Employer separated
from service or (ii) such Employee was a Highly Compensated Employee at any time
after attaining age 55.

          For purposes of this Section 2.28, an Employee who is a nonresident
alien and who receives no earned income (within the meaning of Code Section
911(d)(2)) from the


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Company which constitutes income from sources within the United States (within
the meaning of Code Section 861(a)(3) shall not be treated as an Employee.

          2.29  HOUR OF SERVICE.  Each hour for which an Employee is directly
or indirectly compensated or entitled to compensation, by the Employer for the
performance of duties during the applicable computation period, including hours
for which back pay, irrespective of mitigation of damages, has been either
awarded or agreed to by an Employer, and further including hours for which an
Employee is either directly or indirectly compensated, or entitled to
compensation, by the Employer, for reasons (such as vacation, sickness or
disability) other than the performance of duties during the applicable
computation period.  Hours during which an Employee would have worked during an
Employer-approved leave of absence shall also be credited.  The method of
determining the number of Hours of Service to be credited and the method of
crediting such Hours to computation periods shall conform to the requirements
set forth in Section 2530.200b-2(b) & (c) of the Department of Labor
Regulations.

          2.30  LOAN.  Any loan to the Trustee made or guaranteed by a
disqualified person (within the meaning of Section 4975(e)(2) of the Code),
including, but not limited to, a direct loan of cash, a purchase-money
transaction, an assumption of an obligation of the Trustee, an unsecured
guarantee or the use of assets of a disqualified person (within the meaning of
Section 4975(e)(2) of the Code) as collateral for a loan.

          2.31  NON-HIGHLY COMPENSATED EMPLOYEE.  Any eligible Employee who is
not a Highly Compensated Employee.

          2.32  OTHER INVESTMENTS ACCOUNT.  An Account of a Participant which
is credited with his share of the net income (or loss) of the Trust and Employer
Contributions in other than Company Stock and which is debited with payments
made to pay for Company Stock.

          2.33  PARTICIPANT.  Any Employee who has met the eligibility
requirements set forth in Article III and is participating in the Plan.

          2.34  PLAN.  This Polaris Industries Inc. Employee Stock Ownership
Plan, as hereafter amended from time to time.

          2.35  PLAN YEAR.  The twelve (12) month period beginning on January 1
and ending on December 31.  The Plan Year is also the limitation year for
purposes of Section 415 of the Code.

          2.36  QUALIFIED PARTICIPANT.  Any Participant who has completed at
least ten (10) years of Plan participation and attained age fifty-five (55).


                                          6
<PAGE>

          2.37  RETIREMENT.  Termination of a Participant's employment with the
Company or a subsidiary after he has attained age fifty-nine and one-half
(59-1/2).

          2.38  SECTION 414(s) COMPENSATION.  Compensation as described under
Section 415(c)(3) of the Code and the regulations thereunder, including all
amounts currently not included in an Employee's gross income by reason of
Sections 125 and 402(a)(8) of the Code.

          2.39  SUSPENSE ACCOUNT.  The account maintained by the Trustee to
record unallocated Employer Securities used as collateral on a Loan pursuant to
Section 6.03.

          2.40  TOTAL DISTRIBUTION.  A distribution to a Participant or
Beneficiary, within a single taxable year of such Participant or Beneficiary, of
the entire balance credited to such Participant's or Beneficiary's Accounts.

          2.41  TRUST.  The trust created by the Trust Agreement entered into
pursuant to the Plan between the Company and the Trustee.

          2.42  TRUST AGREEMENT.  The agreement between the Company and the
Trustee (or any successor Trustee) establishing the Trust and specifying the
duties of the Trustee.

          2.43  TRUST ASSETS.  All cash, Company Stock and other property held
in the Trust for the exclusive benefit of Participants and their Beneficiaries.

          2.44  TRUSTEE.  The Trustee or Trustees (and any successor Trustee)
designated by the Company's Board of Directors which agrees to serve by
executing the Trust Agreement.

          2.45  YEAR OF ELIGIBILITY SERVICE.  An Employee will be deemed to
have completed a Year of Eligibility Service if he completes one thousand
(1,000) or more Hours of Service during the twelve (12)-month period beginning
on the date he first completes an Hour of Service for the Employer.  If the
Employee does not complete at least one thousand (1,000) Hours of Service during
the first twelve (12) months of his employment, he will be deemed to have
completed a Year of Eligibility Service in the first Plan Year during which he
is credited with at least one thousand (1,000) Hours of Service.


                                     ARTICLE III

                            ELIGIBILITY AND PARTICIPATION

          3.01  ELIGIBILITY FOR PARTICIPATION.


                                          7
<PAGE>

          (a)   Each Employee, except those described in Sections 3.01(b) and
3.01(c) below, shall become eligible to participate in the Plan as follows:

          (1)   Each salaried Employee, except those described in clause (3)
                below, shall become a Participant in the Plan as of the
                Enrollment Date within the first Plan Year during which he
                completes at least one month of Continuous Service.

          (2)   Each hourly paid Employee, except those described in clause (3)
                below, shall become a Participant in the Plan as of the
                Enrollment Date within the first Plan Year during which such
                Employee completes 480 or more Hours of Service.

          (3)   Each part-time Employee and each seasonal Employee shall become
                a Participant in the Plan as of the Enrollment Date within the
                first Plan Year during which such Employee completes 1,000
                Hours of Service provided that the Employee completes at least
                one month of Continuous Service during such Plan Year.

          (b)   Employees covered by a collective bargaining agreement (as
defined by the United States Secretary of Labor) between Employees'
representatives and an Employer are not eligible to participate in the Plan if
retirement benefits were the subject of good faith bargaining between such
Employees' representatives and the Employer and such collective bargaining
agreement does not provide for participation in the Plan.  No Employee shall
participate in the Plan while he is actually employed by a leasing organization
rather than the Employer.  In addition, Employees (i) who are non-resident
aliens, and (ii) whose primary place of employment is not located in the United
States, are not eligible to participate in the Plan.

          (c)   Any Employee who is a temporary Employee or a student Employee
shall not be eligible to participate in the Plan.

          (d)   Notwithstanding the requirements of Section 3.01(a)(3) and
Section 3.01(c), a regular part-time, seasonal or temporary Employee shall
become a Participant no later than the Enrollment Date within the first Plan
Year during which such Employee completes one Year of Eligibility Service.

          3.02  REEMPLOYMENT OF PARTICIPANT.  A Participant who terminates
employment and is subsequently reemployed by the Company shall be reinstated as
a Participant as of his reemployment date.


                                          8
<PAGE>

                                      ARTICLE IV

                                EMPLOYEE CONTRIBUTIONS

          Contributions by Employees to the Plan are not required or permitted.


                                      ARTICLE V

                                EMPLOYER CONTRIBUTIONS

          5.01  EMPLOYER CONTRIBUTIONS.

          (a)   For each Plan Year, Employer Contributions may be paid to the
Trustee in such amounts (or under such formula) as may be determined by the
Board of Directors not later than the due date for filing the Company's federal
income tax return, including any extensions of such due date; provided, however,
that such Employer Contributions shall not be paid to the Trust in amounts which
would permit the limitation described in Section 7.03 to be exceeded.

          (b)   Employer Contributions may be paid to the Trust in cash or in
shares of Company Stock, as determined by the Board of Directors; provided,
however, that Employer Contributions shall be paid in cash in such amounts and
at such times as needed to provide the Trust with funds sufficient to pay in
full when due any principal and interest payments required by a Loan incurred by
the Trustee pursuant to Article VI to finance the acquisition of Company Stock,
except to the extent such principal and interest payments have been satisfied by
the Trustee from cash dividends paid to it with respect to Employer Securities
(whether allocated or unallocated) acquired with the proceeds of such Loan or
from the proceeds of sale of Employer Securities.

          (c)   Employer Contributions may be returned to the Employer if (i)
made in excess of the amount deductible by the Employer for its taxable year
(all such Employer Contributions being automatically conditioned upon such
deductibility), or (ii) made because of a reasonable mistake as to the facts and
circumstances existing at the time the contribution was fixed; provided,
however, that such return is limited, respectively, to (i) that portion in
excess of the amount deductible for the Employer's taxable year which is not
necessary to enable the Trustee to make Loan payments, or (ii) that portion of
the contribution attributable to a reasonable mistake of fact, and provided,
further, that any such return must be made within one (1) year of the date the
deduction was disallowed or the mistaken contribution was made.


                                          9
<PAGE>

                                      ARTICLE VI

                              INVESTMENT OF TRUST ASSETS

          6.01  INVESTMENT OF TRUST ASSETS.  Trust Assets will be invested
primarily in Employer Securities.  Employer Contributions and cash dividends
paid on Company Stock may be used to acquire shares of Company Stock from
Company shareholders (including former Participants) or from the Company, except
that any Company Stock acquired with the proceeds of a Loan shall be limited to
Employer Securities.  Except as otherwise provided in Section 6.02, Trust Assets
not acquired with the proceeds of a Loan and not invested in Company Stock shall
be invested by the Trustee in accordance with the Trust Agreement.  All
investments in Company Stock will be made by the Trustee only upon the direction
of the Committee.  The Committee may direct that all Trust Assets be invested
and held in Company Stock.  All purchases of Company Stock by the Trust will be
made at a price or at prices which, in the judgment of the Committee, do not
exceed the fair market value of such Company Stock at the time of purchase.  The
Committee may direct the Trustee to sell or resell shares of Company Stock to
any person, including the Company; provided, however, that any such sale to any
disqualified person (as defined by Section 4975(e)(2) of the Code), including
the Company, shall be made at not less than the fair market value of such shares
of Company Stock.  Any such sale shall be made in conformance with
Section 408(e) of ERISA.  Notwithstanding any other provision of the Plan, the
dividends paid with respect to Company Stock may be (i) paid directly to
Participants, (ii) paid to the Trustee and then distributed to Participants
within 90 days thereafter, or (iii) allocated to the Accounts of Participants,
as determined by the Committee in its sole discretion.

          6.02  DIVERSIFICATION.  Each Qualified Participant may, by applying
to the Committee within ninety (90) days after the close of each Plan Year
during such Qualified Participant's Election Period, elect to have his Eligible
Diversification Amount transferred to the Polaris Industries Inc. 401(k)
Retirement Savings Plan and invested in accordance with the provisions of such
Plan.  Such transfer shall be completed by the Committee no later than one
hundred eighty (180) days after the first day of the Plan Year in which such
application is made.  The Committee may, in a manner consistent with the
applicable requirements of the Code and regulations issued pursuant thereto,
limit or prohibit diversification by Qualified Participants of de minimis
amounts.

          6.03  EXEMPT LOAN.

          (a)   The Committee may direct the Trustee to obtain Loans.  Any such
Loan shall meet all requirements necessary to constitute an "exempt loan" within
the meaning of Treasury Regulation Section 54.4975-7(b)(1)(iii) and shall be
used primarily for the benefit of Participants (and their Beneficiaries).  The
proceeds of any such Loan shall be used, within a reasonable time after the Loan
is obtained, only to purchase Employer Securities, repay the Loan or repay any
prior Loan.  Any such Loan shall provide for no more than a reasonable


                                          10
<PAGE>

rate of interest, as determined under Treasury Regulation Section
54.4975-7(b)(7), and must be without recourse against the Plan. The number of
years to maturity under the Loan must be definitely ascertainable at all times.
The only assets of the Plan that may be given as collateral for a Loan are
shares of Employer Securities acquired with the proceeds of the Loan and shares
of Employer Securities that were used as collateral on a prior Loan repaid with
the proceeds of the current Loan.  Such Employer Securities so pledged shall be
placed in a Suspense Account.  No person entitled to payment under a Loan shall
have recourse against Trust Assets other than such collateral, Employer
Contributions that are available under the Plan to meet obligations under the
Loan and earnings attributable to such collateral and the investment of such
Employer Contributions.

          All Employer Contributions paid during the Plan Year in which a Loan
is made (whether before or after the date the proceeds of the Loan are
received), all Employer Contributions paid thereafter until the Loan has been
repaid in full and all earnings from investment of such Employer Contributions,
without regard to whether any such Employer Contributions and earnings have been
allocated to Participants' Other Investments Accounts, shall be available to
meet obligations under the Loan, unless otherwise provided by the Company at the
time any such Employer Contribution is made.  Any pledge of Employer Securities
must provide for the release of an appropriate number of shares so pledged, as
provided below, upon the payment of any portion of the Loan.  For each Plan Year
during the duration of the Loan, the number of shares of Employer Securities
released from such pledge must equal the number of encumbered securities held
immediately before release for the current Plan Year multiplied by a fraction,
the numerator of which is the amount of principal paid for the year and the
denominator of which is the sum of the numerator plus the principal to be paid
for all future years.  Such years will be determined without taking into account
any possible extension or renewal periods.  The Loan shall (i) provide for
annual payments of principal and interest at a cumulative rate that is not less
rapid at any time than level annual payment of such amount for ten (10) years,
(ii) provide that interest included in any payment is disregarded for the
purpose of the release from pledge only to the extent that it would be
determined to be interest under standard loan amortization tables and (iii)
provide that the duration of the Loan including renewal extension, or
refinancing, shall not exceed ten (10) years.  Notwithstanding the foregoing,
the Committee may elect, in its sole discretion, to provide for the release of
Employer Securities from the Suspense Account on the basis of both principal and
interest paid during the Plan Year.  If the Committee elects to apply this
method, it shall be applied throughout the period of such Loan, and the
limitations set forth in clauses (i), (ii) and (iii) above shall not apply to
the Loan.  In the event such interest is variable, the interest to be paid in
future years must be computed by using the interest rate applicable as of the
end of the Plan Year.  If the collateral includes more than one class of
Employer Securities, the number of shares of each class to be released for a
Plan Year must be determined by applying the same fraction to each class.

          (b)   Payments of principal and interest on a Loan during a Plan Year
shall be made by the Trustee (as directed by the Committee) only from (i)
Employer Contributions to


                                          11
<PAGE>

the Trust made to meet the Plan's obligation under such Loan, earnings from such
Employer Contributions and any earnings attributable to Employer Securities held
as collateral for such Loan (both received during or prior to the Plan Year),
less such payments in prior years; (ii) the proceeds of a subsequent Loan made
to repay such prior Loan; and (iii) the proceeds of the sale of any Employer
Securities held as collateral for such Loan.  Such Employer Contributions and
earnings must be accounted for separately by the Plan until the Loan is repaid.

          (c)   Employer Securities released by reason of the payment of
principal or interest on a Loan from amounts allocated to Participants' Other
Investments Accounts shall immediately upon payment be credited pro rata to the
corresponding Participants' Company Stock Accounts.  In the event that cash
dividends paid on Employer Securities allocated to Participants' Accounts are
used to repay a Loan, before determining Participants' allocable shares of
Employer Securities released from the Suspense Account for any Plan Year
pursuant to Section 7.02, there shall first be allocated to the Company Stock
Accounts of Participants to whose Accounts such cash dividends would have been
allocated but for such Loan repayment a number of Employer Securities having a
fair market value not less than the amount of the cash dividends so applied.
Only that number of Employer Securities released from the Suspense Account which
is in excess of the number allocated pursuant to the immediately preceding
sentence shall be available for allocation pursuant to Section 7.02(a).

          (d)   The Employer shall contribute to the Trust amounts sufficient,
after taking into account cash dividends on Employer Securities (whether
allocated or unallocated) and the proceeds of sale, if any, of Employer
Securities acquired with the proceeds of a Loan available for such purpose, to
enable the Trust to pay principal and interest on any such Loan as they are due;
provided, however, that no such Employer Contribution shall exceed the
limitations in Section 7.03.  In the event that such Employer Contributions are
insufficient by reason of the limitations in Section 7.03 to enable the Trust to
pay the principal of and interest on such Loan as they are due, then, at the
election of the Committee, the Employer shall:

          (1)   Make a Loan to the Trust, as described in Treasury Regulation
                Section 54.4975-7(b)(4)(iii), in an amount sufficient to meet
                such principal and interest payments.  Such new Loan shall also
                meet all requirements of an "exempt loan" within the meaning of
                Treasury Regulation Section 54.4975-7(b)(1)(iii).  Employer
                Securities released from the pledge of the prior Loan shall be
                pledged as collateral to secure the new Loan.  Such Employer
                Securities will be released from this new pledge and allocated
                to the Accounts of the Participants in accordance with the
                applicable provisions of the Plan; or

          (2)   Purchase any Employer Securities pledged as collateral in an
                amount necessary to provide the Trustee with funds sufficient
                to make the


                                          12
<PAGE>

                principal and interest payments.  Any such sale by the Plan
                shall meet the requirements of Section 408(3) of ERISA; or

          (3)   Do any combination of the foregoing.

However, the Employer shall not, pursuant to the provisions of this Section
6.03(d), do, fail to do, cause to be done or cause to be not done any act or
thing which would result in a disqualification of the Plan as a leveraged
employee stock ownership plan under the Code.

          (e)   PUT OPTION.  Shares of Employer Securities acquired with the
proceeds of a Loan by the Trust shall be subject to a "put" option at the time
of distribution; provided, however, that at such time the shares of Employer
Securities are not publicly traded within the meaning of Treasury Regulation
Section 54.4975-7(b)(1)(iv) or, if publicly traded, are subject to a trading
limitation (a "trading limitation" on a security is a restriction under any
federal or state securities law, any regulation thereunder or an agreement
affecting the security which would make the security not as freely tradeable as
one not subject to such restriction).  The "put" option shall be exercisable by
the Participant or Beneficiary, by the donees of either or by a person
(including an estate or its distributee) to whom the Employer Securities pass by
reason of the Participant's or Beneficiary's death.  This "put" option provides
that, for a period of at least sixty (60) consecutive days immediately following
the date shares are distributed to the holder of the option and for another
sixty (60) consecutive day period during the Plan Year next following the Plan
Year in which shares were distributed, the holder of the option shall have the
right to cause the Company, by notifying it in writing, to purchase such shares
at their fair market value, as determined by the Committee.  The Committee may,
with the consent of the Trustee, direct the Trustee to assume the rights and
obligations of the Company at the time a "put" option is exercised, insofar as
the repurchase of Employer Securities is concerned.  The period during which a
"put" option is exercisable shall not include any period during which the holder
is unable to exercise such "put" option because the Company is prohibited from
honoring it by federal or state law.  The terms of payment for the purchase of
such shares of Employer Securities shall be as set forth in the "put" and:

          (1)   If the distribution constitutes a Total Distribution, payment
                of the fair market value of the Employer Securities shall be
                made in five (5) substantially equal annual payments.  The
                first such installment shall be paid no later than thirty (30)
                days after exercise of the "put" option.  The Company or the
                Plan, as the case may be, shall pay a reasonable rate of
                interest and provide adequate security on amounts not paid
                after thirty (30) days.

          (2)   If the distribution does not constitute a Total Distribution,
                the Company or the Plan, as the case may be, shall pay the
                Participant or Beneficiary an amount equal to the fair market
                value of the Employer Securities


                                          13
<PAGE>

                repurchased no later than thirty (30) days after the "put"
                option is exercised.

The "put" option provided for by this Section 6.03(e) shall continue to apply to
shares of Employer Securities purchased by the Trustee with the proceeds of a
Loan as described herein, notwithstanding any amendment to or termination of the
Plan which causes the Plan to cease to be a leveraged employee stock ownership
plan within the meaning of Section 4975(e)(7) of the Code.

          (f)   NONTERMINABLE PROTECTIONS AND RIGHTS.  No Employer Securities
acquired with the proceeds of a Loan shall be subject to any put, call or other
option, or buy-sell or similar arrangement while held by and when distributed
from the Plan, other than those described in Section 6.03(e) or as otherwise
required by applicable law.  These protections and rights are nonterminable.


                                     ARTICLE VII

                                     ALLOCATIONS

          7.01  ALLOCATIONS TO PARTICIPANTS' ACCOUNTS.

          (a)   Separate Company Stock Accounts and Other Investments Accounts
will be established to reflect Participants' interests under the Plan.  Records
shall be kept by the Committee from which can be determined the portion of each
Other Investments Account which at any time is available to meet Loan
obligations and the portion which is not so available as determined pursuant to
Section 6.03.

          (b)   As of each Anniversary Date, the Company Stock Account
maintained for each Participant under the Plan will be credited with his
allocable shares of Company Stock (including fractional shares) purchased and
paid for by the Trust or contributed in kind to the Trust with Employer
Contributions and any stock dividends on Company Stock allocable to his Company
Stock Account.  Employer Securities acquired by the Trust with the proceeds of a
Loan obtained pursuant to Section 6.03 shall be allocated to the Company Stock
Accounts of Participants as the Employer Securities are released from the
Suspense Account as provided for in Section 6.03.

          (c)   As of each Anniversary Date, each Other Investments Account
maintained for each Participant under the Plan will be credited (or debited)
with its share of the net income (or loss) of the Trust, with any cash dividends
on Company Stock allocable to his Company Stock Account and with Employer
Contributions in cash.  Each such Other Investments Account will be debited with
its share of any cash payments for the acquisition of Company Stock for the
benefit of Company Stock Accounts or for any payment of principal of


                                          14
<PAGE>

and interest on any Loan or other debt chargeable to Participants' Company Stock
Accounts; provided, however, that only the portion of each Other Investments
Account which is available to meet obligations under Loans as determined
pursuant to the provisions of Section 6.03(a) shall be used to pay principal or
interest on a Loan.

          7.02  ALLOCABLE SHARES.

          (a)   Each Plan Year, Employer Contributions not applied to pay
principal of or interest on a Loan and, subject to Section 6.03(c), Employer
Securities released from the Suspense Account for a Plan Year (the "Allocable
Amounts") shall be divided into two parts and allocated as set forth in
subsections 7.02(a)(1) and 7.02(a)(2) below.

          (1)   The first 85% of the Allocable Amounts for such Plan Year shall
                be allocated to the Company Stock Accounts for all Participants
                entitled to receive an allocation for such Plan Year.  The
                allocation to which each such Participant shall be entitled
                under this Section 7.02(a)(1) shall be determined by
                multiplying 85% of such Allocable Amounts by a fraction, the
                numerator of which is such Participant's Compensation for such
                Plan Year and the denominator of which is the sum of the
                Compensation of each Participant entitled to an allocation for
                such Plan Year.

          (2)   The remaining 15% of the Allocable Amounts for such Plan Year
                shall be allocated to the Company Stock Accounts for all
                Participants entitled to receive an allocation for such Plan
                Year.  The allocation to which each such Participant shall be
                entitled under this Section 7.02(a)(2) shall be determined by
                multiplying 15% of such Allocable Amounts by a fraction, the
                numerator of which is such Participant's months of Continuous
                Service prior to and including such Plan Year, and the
                denominator of which is the aggregate months of Continuous
                Service of each Participant entitled to an allocation for such
                Plan Year prior to and including such Plan Year.

          (b)   A Participant must be actively employed by the Employer on the
Anniversary Date of any Plan Year in order to share in the allocation of any
Employer Contributions for such Plan Year made pursuant to Section 7.02(a)
except in the case of the Participant's death during such Plan Year.

          7.03  ALLOCATION LIMITATIONS.

          (a)   For each Plan Year, the Annual Addition to the Accounts of a
Participant under the Plan and to the accounts of such Participant under all
other defined


                                          15
<PAGE>

contribution plans maintained by the Company or any Affiliated Company, may not
exceed the lesser of:

          (1)   twenty-five (25) percent of his Section 414(s) Compensation; or

          (2)   $30,000 or, if greater, one-fourth (1/4) of the defined benefit
                dollar limitation set forth in Section 415(b)(1) of the Code as
                in effect for such Plan Year.

          If this limitation would be exceeded as to any Participant, the
allocation of Employer Contributions shall be reduced with respect to such
Participant, with a reallocation made to other Participants according to the
allocable share of each as determined under Section 7.02 (to the extent not
exceeding the limitation as to each).  In the event the Plan is terminated and
there are amounts which cannot be allocated to Participants' Accounts due to
this limitation, such amounts will be returned to the Employer.

          If a Participant is, or was, covered under a defined benefit plan and
a defined contribution plan maintained by the Employer, the sum of such
Participant's defined benefit plan fraction and defined contribution plan
fraction (both calculated as provided below) may not exceed one (1.0) in any
Plan Year.

          A defined benefit plan fraction is a fraction, the numerator of which
is the sum of a Participant's projected annual benefits (as defined below) under
all defined benefit plans (whether or not terminated) maintained by the
Employer, and the denominator of which is the lesser of (i) one and one-quarter
(1.25) times the dollar limitation of Section 415(b)(1)(A) of the Code in effect
for a Plan Year and (ii) one and four-tenths (1.4) times such Participant's
average Section 414(s) Compensation for the three (3) consecutive years that
produce the highest average.

          A defined contribution plan fraction is a fraction, the numerator of
which is the sum of the Annual Additions to a Participant's accounts under all
defined contribution plans (whether or not terminated) maintained by the
Employer for the current and all prior limitation years, and the denominator of
which is the sum of the lesser of the following amounts determined for such year
and for each prior year of Service with the Employer:  (i) one and one-quarter
(1.25) times the dollar limitation in effect under Section 415(c)(1)(A) of the
Code for each such year and (ii) one and four-tenths (1.4) times the amount
which may be taken into account under Section 415(c)(1)(B) of the Code.

          Projected annual benefit means the annual benefit to which a
Participant would be entitled under the terms of the applicable defined benefit
plan, if such Participant continued employment until normal retirement age (or
current age, if later) and such Participant's compensation for the limitation
year and all other relevant factors used to determine such benefit remained
constant until normal retirement age (or current age, if later).


                                          16
<PAGE>

          If, in any Plan Year, the sum of a Participant's defined benefit plan
fraction and defined contribution plan fraction would exceed one (1.0), such
Participant's Annual Addition under the Plan will be limited to the extent
necessary to comply with Section 415 of the Code.

          7.04  ALLOCATION OF NET INCOME (OR LOSS) OF THE TRUST. The net income
(or loss) attributable to Trust Assets for each Plan Year will be determined as
of each Anniversary Date.  Each Participant's allocable share of the net income
(or loss) will be allocated to his Other Investments Account in the ratio in
which the credit balance of each such Account on the preceding Anniversary Date
(reduced by the amount of any distribution of Capital Accumulation from such
Account) bears to the sum of such balances for all Participants as of that date.
The net income (or loss) includes the increase (or decrease) in the fair market
value of Trust Assets (other than Company Stock), interest income, dividends and
other income (or loss) attributable to Trust Assets (other than allocated
Company Stock) since the preceding Anniversary Date.  For purposes of computing
net income (or loss), interest paid on any Loan or installment sales contract
for the acquisition of Employer Securities by the Trustee shall be disregarded.

          7.05  ACCOUNTING FOR ALLOCATIONS.  The Committee shall adopt
accounting procedures for the purpose of making the allocations, valuations and
adjustments to Participants' Accounts provided for in this Article VII.  Except
as provided in Treasury Regulation Section 54.4975-11, Company Stock acquired by
the Plan shall be accounted for as provided under Treasury Regulation
Section 1.402(a)-1(b)(2)(ii), allocations of Company Stock shall be made
separately for each class of stock and the Committee shall maintain adequate
records of the cost basis of all shares of Company Stock allocated to each
Participant's Company Stock Account.  From time to time, the Committee may
modify the accounting procedures for the purpose of achieving equitable and
nondiscriminatory allocations among the Accounts of Participants in accordance
with the general concepts of the Plan and the provisions of this Section.
Annual valuations of Trust Assets shall be made at fair market value.  All
valuations of shares of Company Stock which are not readily tradeable on an
established securities market shall be made by an independent appraiser meeting
requirements similar to those contained in Treasury Regulations under
Section 170(a)(1) of the Code.

          7.06  NONALLOCATION.  Notwithstanding any provision in this Plan to
the contrary, in accordance with Section 409(n) of the Code, if shares of
Company Stock are sold to the Plan by a shareholder of the Company in a
transaction for which special tax treatment is elected pursuant to Section 1042
of the Code by such shareholder, no assets attributable to such Company Stock
may be allocated during the period beginning on the date of the sale of such
shares of Company Stock to the Trust and ending on the later of the tenth (10th)
year anniversary of the date of sale or the date of the allocation attributable
to the final payment on the Loan incurred with respect to the sale to the
Accounts of such shareholder, any person who is related to such shareholder
(within the meaning of Section 267(b) of the Code, but excluding lineal
descendants of such shareholder as long as no more than five (5) percent of the
aggregate amount of all shares of Company Stock sold by such shareholder in a
transaction


                                          17
<PAGE>

to which Section 1042 of the Code applies is allocated to lineal descendants of
such shareholder) or any other person who owns (after application of Section
318(a) of the Code) more than twenty-five (25) percent in value of the
outstanding securities of the Employer.  Further, no allocation of contributions
may be made to the Accounts of such persons unless additional allocations are
made to other Participants, in compliance with the provisions of Sections
401(a)(4) and 410 of the Code, computed without regard to the allocation of any
stock acquired by the Plan in a transaction to which Section 1042 applied.


                                     ARTICLE VIII

                            EXPENSES OF THE PLAN AND TRUST

          All expenses of administering the Plan shall be paid by the Trust to
the extent such are not paid by the Company.  The Company may, but shall not be
required to, pay such expenses from time to time.  Each Employer, other than the
Company, shall reimburse the Company for that portion of costs and expenses paid
by the Company for any Plan Year as the amount of Employer Contributions from
each such Employer for such Plan Year bears to the aggregate Employer
Contributions from all Employers for that Plan Year.


                                      ARTICLE IX

                  VOTING COMPANY STOCK AND EXERCISE OF OTHER RIGHTS

          9.01  VOTING AND TENDER OR EXCHANGE RIGHTS.  If the Company or any
Affiliated Company has a registration-type class of securities (as defined in
Section 409(e)(4) of the Code), then, all shares of Company Stock allocated to
Company Stock Accounts or the Suspense Account and entitled to vote shall be
voted only in accordance with the provisions of Sections 9.01(a), (b), (d) and
(e) applicable to voting.  If neither the Company nor any Affiliated Company has
a registration-type class of securities (as defined in Section 409(e)(4) of the
Code), then, only with respect to any corporate matter which involves the voting
of Company Stock allocated to Company Stock Accounts or the Suspense Account
with respect to the approval or disapproval of any corporate merger or
consolidation, recapitalization, reclassification, liquidation, dissolution,
sale of substantially all assets of a trade or business or such other similar
transaction that Treasury Regulations require, all shares of such Company Stock
shall be voted only in accordance with the provisions of Sections 9.01(a), (b),
(d) and (e) applicable to voting.  In all cases in which a "tender offer" (as
defined in Section 9.01(a)) is made for Company Stock, the provisions of
Sections 9.01(a), (c), (d) and (e) applicable to a tender offer (as so defined)
shall apply.  Where the Trustee is not required to solicit voting instructions
under the second sentence of this paragraph or where the Committee is explicitly
given discretion under Section 9.01(a), (b) or (c), the Trustee shall vote and
take action, as applicable, only as the Committee directs in the Committee's
sole discretion, after the


                                          18
<PAGE>

Committee determines such action to be in the best interests of Participants and
Beneficiaries.  If any action of holders of Company Stock is sought to be taken
by means of a written consent of such holders in lieu of a meeting of such
holders, the giving of such consent is a vote in favor of such action and the
provisions of this Section 9.01 applicable to voting shall apply.

          (a)   To the extent provided under the foregoing paragraph, the
Trustee shall vote the shares of Company Stock allocated to any Participant's or
Beneficiary's Accounts (including fractional as well as whole shares) in
accordance with timely directions of such Participant or Beneficiary,
respectively; provided, however, that if a Participant or Beneficiary fails to
give such timely direction the shares allocated to such Participant's or
Beneficiary's Accounts shall be voted in the manner directed by the Committee.
The Trustee shall, with respect to the shares of Company Stock allocated to any
Participant's or Beneficiary's Accounts (including fractional as well as whole
shares), act in response to any tender offer or exchange offer for shares of
Company Stock commenced by any person or group of persons, including, but not
limited to, a tender offer or exchange offer within the meaning of the
Securities Exchange Act of 1934, as amended from time to time (any such tender
or exchange offer being a "tender offer"), in accordance with timely directions
of such Participant or Beneficiary; provided, however, that if a Participant or
Beneficiary fails to give such timely direction the manner in which the Trustee
is to act in response to a tender offer with respect to the shares of Company
Stock allocated to such Participant's or Beneficiary's Accounts shall be
directed by the Committee.  For purposes of determining the number of shares of
Company Stock to be voted in any particular manner or to be the subject of any
particular response to a tender offer, the Trustee shall use the nearest
practicable date as determined by the Trustee.

          (b)   The Trustee's functions and responsibilities with respect to
shares of Company Stock, including shares of Company Stock in the Suspense
Account, with respect to voting, shall be exercised as follows:

          (1)   Each Participant:  (i) is hereby designated as a named
                fiduciary for purposes of ERISA with respect to the voting of
                shares of Company Stock allocated to the applicable Accounts,
                and with respect to the voting of the applicable portion (as
                determined under Section 9.01(b)(3)) of the shares of Company
                Stock held in the Suspense Account, and (ii) shall have the
                right to direct the Trustee with respect to the voting of such
                shares of Company Stock on each matter brought before any
                meeting of the stockholders of the Company and on which such
                shares are entitled to vote.

          (2)   Before each such meeting of shareholders, the Trustee shall
                cause to be furnished to each Participant and Beneficiary a
                copy of the proxy solicitation or information materials as
                shall have been furnished to the Trustee by the issuer of the
                Company Stock to be voted at such meeting or, in the case of a
                proxy solicitation by any person or group of persons


                                          19
<PAGE>

                other than the board of directors of such issuer, such person
                or group, together with a form requesting confidential
                directions for the Trustee on how the whole and fractional
                shares of Company Stock which are allocated to such
                Participant's or Beneficiary's Accounts (or with respect to
                which such Participant or Beneficiary otherwise has control
                under Section 9.01(b)(3)) shall be voted on each such matter.
                The Company and the Committee shall cooperate with the Trustee
                in an attempt to ensure that Participants and Beneficiaries
                receive the requisite information in a timely manner.  Upon
                timely receipt of such directions, the Trustee shall on each
                such matter vote as directed the number of shares (including
                fractional shares of Company Stock) allocated to such
                Participant's or Beneficiary's Accounts.  The instructions
                received by the Trustee from Participants and Beneficiaries
                shall be held by the Trustee in confidence and shall not be
                divulged or released to any person, including the Committee or
                the officers or Employees of the Company or any Affiliated
                Company.

          (3)   The Trustee shall vote all shares of Company Stock in the
                Suspense Account in the same proportion as the allocated shares
                of Company Stock for which affirmative directions from
                Participants to vote for or against each proposal are voted.
                The Committee may establish procedures, which shall be followed
                by the Trustee upon and after its receipt of notice thereof, by
                which Participants may provide separate sets of instructions
                with respect to shares of Company Stock allocated to their
                Accounts and the pro rata amount of unallocated shares of
                Company Stock over which they have voting control.  If a vote
                is taken at a time when there are no allocated shares of
                Company Stock, the Trustee shall vote the shares of Company
                Stock in the Suspense Account as directed by the Committee in
                the Committee's discretion.

          (c)   The Trustee's functions and responsibilities with respect to
shares of Company Stock, including shares of Company Stock in the Suspense
Account, with respect to all decisions made in response to a tender offer, shall
be exercised as follows:

          (1)   In the event a tender offer is commenced, the Committee,
                promptly after receiving notice of the commencement of any such
                tender offer, shall transfer certain of the Plan's
                record-keeping functions to an independent record-keeper
                (which, if the Committee consents in writing, may be the
                Trustee).  The functions so transferred shall be those
                necessary to preserve the confidentiality of any directions
                given by Participants and Beneficiaries in connection with the
                tender offer.  Such record-keeper shall use its best efforts to
                distribute or cause to be distributed on a timely basis to each
                Participant and Beneficiary such information as is


                                          20
<PAGE>

                being distributed to other shareholders of the Company in
                connection with any such tender offer.  The Company and the
                Committee shall cooperate with such record-keeper in an attempt
                to ensure that Participants and Beneficiaries receive the
                requisite information in a timely manner.  The independent
                record-keeper shall solicit confidentially from each
                Participant and Beneficiary the directions described below as
                to the action to be taken with respect to shares of Company
                Stock held under the Plan in response to a tender offer.  The
                independent record-keeper, if different from the Trustee, shall
                instruct the Trustee as to all required action, including an
                identification of the amount of shares of Company Stock covered
                by any particular required action, in accordance with the
                following provisions.

          (2)   Each Participant:  (i) is hereby designated as a named
                fiduciary for purposes of ERISA with respect to all decisions
                made in response to a tender offer regarding shares of Company
                Stock allocated to the applicable Accounts, and with respect to
                all such decisions regarding the applicable portion (as
                determined under Section 9.01(c)(4)) of the shares of Company
                Stock held in the Suspense Account, and (ii) shall have the
                right to direct the Trustee with respect to all such decisions.

          (3)   Upon timely receipt of such directions, the Trustee shall on
                each such matter act as directed (including, without
                limitation, to engage in selling, exchanging, tendering or
                retaining) with respect to the number of shares of Company
                Stock (including fractional shares of Company Stock) allocated
                to such Participant's Accounts. The instructions received by
                the Trustee from Participants shall be held by the Trustee in
                confidence and shall not be divulged or released to any person,
                including the Committee or the officers or Employees of the
                Company or any Affiliated Company.

          (4)   The Trustee shall act as directed (including, without
                limitation, to engage in selling, exchanging, tendering or
                retaining) with respect to the number of shares of Company
                Stock (including fractional shares) in the Suspense Account in
                the same proportion as it acts regarding shares of Company
                Stock allocated to the Accounts of Participants.  The Committee
                may establish procedures, which shall be followed by the
                Trustee upon and after its receipt of notice thereof, by which
                Participants may provide separate sets of instructions with
                respect to shares of Company Stock allocated to their Accounts
                and the pro rata amount of unallocated shares of Company Stock
                over which they have control regarding tender offers.  If a
                tender offer occurs at a time when there are no allocated
                shares of Company Stock, the Trustee shall act in


                                          21
<PAGE>

                response to the tender offer with respect to shares of Company
                Stock in the Suspense Account as directed by the Committee in
                the Committee's discretion.

          (d)   Nothing contained in this Section 9.01 shall confer upon
Participants, Beneficiaries, the Committee or the Trustee any additional voting
rights in respect of shares of Company Stock held under the Plan other than the
rights set forth in the certificate of incorporation of the Company and under
state and federal law.

          Nothing contained in this Section 9.01 shall confer upon Participants,
Beneficiaries, the Committee or the Trustee any additional rights in respect of
a tender offer, merger or consolidation relating to the shares of Company Stock
held under the Plan other than the rights set forth in the certificate of
incorporation of the Company and under state and federal law.

          (e)   Any individual who has an interest under the Plan in the nature
of the interest of a Participant or Beneficiary but who is not technically a
Participant or Beneficiary shall be treated as a Beneficiary for purposes of the
foregoing provisions of this Section.


                                      ARTICLE X

                                 CAPITAL ACCUMULATION

          Each Participant shall at all times have a 100% fully vested interest
in his Accounts.


                                      ARTICLE XI

                                    DISTRIBUTIONS

          11.01 TIME OF DISTRIBUTION TO PARTICIPANTS.

          (a)   Any Participant whose employment ends by reason of his
Retirement, death or Disability shall receive the vested balance in his Accounts
as soon as is administratively practicable after the end of the Plan Year in
which his employment ends, unless such Participant, or such Participant's
Beneficiary in the event of the Participant's death, elects to defer payment
until a later date.

          (b)   Any Participant whose employment ends for any reason other than
those specified in Section 11.01(a) shall receive the vested balance in his
Accounts as soon as is


                                          22
<PAGE>

administratively practicable after the end of the fifth Plan Year following the
Plan Year in which his employment ends, unless such Participant elects to defer
payment until a later date.

          (c)   Notwithstanding any other provision of this Plan, distribution
of the benefits of any Participant who reaches age seventy and one-half (70-1/2)
shall commence no later than the later of (i) the April 1st next following the
end of the calendar year in which he reaches age seventy and one-half (70-1/2)
or (ii) the date on which such Participant's employment with the Company
terminates, regardless of whether any Loan has been repaid.  Notwithstanding the
foregoing, in the case of a Participant who is a five-percent owner (as defined
in Code Section 416(i)), distribution of such Participant's benefits shall
commence no later than the April 1 next following the end of the calendar year
in which he reaches age seventy and one-half (70-1/2)

          11.02 BENEFIT FORMS FOR PARTICIPANTS.  A Participant's Capital
Accumulation shall, at the election of such Participant, be paid to him in
either a single distribution or a number of annual installments not to exceed
five (5).  In the case of an installment distribution, each installment shall be
equal to (i) the number of shares of Company Stock credited to such
Participant's Company Stock Account and the balance credited to such
Participant's Other Investments Account, each divided by (ii) the number of
installments which remain to be paid (including the current installment being
computed).

          11.03 BENEFIT FORM ON A PARTICIPANT'S DEATH.  If a Participant's
employment is ended by death, or if a terminated Participant has a Capital
Accumulation which has not been fully distributed at the time of his death, such
Participant's remaining Capital Accumulation shall be paid to his Beneficiary in
a single lump sum, within one (1) year after the end of the Plan Year in which
such Participant died.

          11.04 DISTRIBUTION IN COMPANY STOCK.  A Participant's benefits shall
be paid in the form of Company Stock; provided, however, that the value of any
fractional shares of Company Stock shall be paid in cash.

          11.05 DELAY IN BENEFIT DETERMINATION.  If the Committee is unable to
determine the benefits payable to a Participant or Beneficiary on or before the
latest date prescribed for payment, the benefits shall be paid within sixty (60)
days after the date they can first be determined, with whatever makeup payments
may be appropriate in view of the delay.

          11.06 DESIGNATED BENEFICIARIES.

          (a)   Any person who may become entitled to receive a distribution
under this Article XI may appoint any other person or persons (including a trust
or trusts) as his Beneficiary or Beneficiaries for receipt of such distribution
in the event of his death by filing an appointment with the Committee on forms
provided by it.  In the absence of such appointment, a person's Beneficiary or
Beneficiaries will be deemed to be the Beneficiary or


                                          23
<PAGE>

Beneficiaries designated by such person under the Polaris Industries Inc. 401(k)
Retirement Savings Plan, if any, or, if none, the  Beneficiary or Beneficiaries
designated by such Plan.  Notwithstanding the foregoing, in the case of a
Participant who is legally married at the date of his death, his Beneficiary
shall be deemed to be the person to whom he was so married, notwithstanding and
disregarding any failure by such Participant to appoint a Beneficiary, or his
appointment of a trust or any other person as his Beneficiary, unless such
Participant had obtained, on forms provided by the Committee, the consent of the
person to whom he was so married to his appointment of a trust or other person
or to his appointment of no Beneficiary.  The spouse's consent to payment to a
designated Beneficiary other than the spouse must be in writing on such  forms,
must designate a Beneficiary which may not be changed without spousal consent
(unless the consent of the spouse expressly permits designations by the
Participant without any requirement of further consent by the spouse), must
acknowledge the effect of such election and must be witnessed by a notary
public.

          (b)   Subject to the provisions of Section 11.06(a), a Beneficiary
appointment may be revoked or changed by the appointing person's filing with the
Committee, on forms provided by it, a notice of revocation or change, with a
change of Beneficiary being considered a revocation and the naming of a new
Beneficiary.

          (c)   An appointment shall not be effective if the Beneficiary named
therein fails to survive the appointing person.

          11.07 ADDITIONAL DISTRIBUTION REQUIREMENTS.  All benefit
distributions shall be subject to the following additional requirements:

          (a)   DURATION OF BENEFIT PAYMENTS.  The distribution of benefit
payments to each Participant shall be made in accordance with regulations
prescribed by the Secretary of the Treasury over a period not extending beyond
the life expectancy of such Participant or the joint life expectancy of such
Participant and a designated Beneficiary, except that in no event shall the
period of distribution exceed that otherwise permitted under the Plan.

          (b)   DEATH OF PARTICIPANT BEFORE BENEFITS COMMENCE.  In the event
that a Participant dies before the commencement of benefits hereunder, the
entire interest of such Participant under the Plan (if any) shall be distributed
not later than the last day of the calendar year in which occurs the fifth (5th)
anniversary of the death of such Participant or, where any portion of such
Participant's benefit is to be paid to (or for the benefit of) such
Participant's surviving spouse or other designated Beneficiary, such benefit
must commence not later than the last day of the calendar year following the
calendar year in which such Participant's death occurred and be paid over a
period not exceeding the life (of life expectancy) of the surviving spouse or
designated Beneficiary, except that where the Beneficiary is such Participant's
surviving spouse, payments to the surviving spouse need not begin before the
date on which such Participant would have attained age seventy and one-half
(70-1/2).  However, in no event


                                          24
<PAGE>

shall the commencement date or period of distribution exceed that otherwise
permitted under the Plan.

          (c)   DEATH AFTER COMMENCEMENT OF BENEFITS.  If the distribution of
benefits hereunder has commenced and a Participant dies before his entire
interest has been distributed to him, the remaining part of such interest will
be distributed to the surviving payee no less rapidly than under the method of
distribution which was in effect on the date of such Participant's death.

          (d)   "INCIDENTAL" BENEFITS AND EFFECT OF REQUIREMENTS.  In the event
that any payment hereunder is to be made to someone other than a Participant or
jointly to such Participant and his spouse or other payee, such payments must
conform to the "incidental benefit" rules of Section 401(a)(9)(G) of the Code
and Treasury Regulation Section 1.401(a)(9)-2.  In addition, all distributions
from the Plan must conform to the rules of this Section, Section 401(a)(9) of
the Code and the regulations promulgated thereunder to the extent not in
conflict with any other provision of the Code.

          (e)   LUMP SUM PAYMENT.  If a Participant's Capital Accumulation is
more than $3,500, such Participant shall be given written notice of his right to
defer the date of distribution of his benefit, and if he does not elect a
current distribution by giving his consent in writing within sixty (60) days of
such notice, the Capital Accumulation shall be retained in the Trust until the
earlier of the date on which such Participant dies, requests distribution in
writing or the date such Participant attains his normal retirement age (59-1/2).

          11.08 DISTRIBUTIONS PURSUANT TO QUALIFIED DOMESTIC RELATIONS ORDERS.

          (a)   PAYMENTS TO AN ALTERNATE PAYEE UNDER A QUALIFIED DOMESTIC
RELATIONS ORDER.  The Committee shall pay benefits to the Alternate Payee(s) (as
defined below) in accordance with the terms of this Section 11.08, any
government regulations adopted under Section 206 of ERISA and the applicable
provisions of any Qualified Domestic Relations Order (as defined below) entered
by a court of competent jurisdiction on or after January 1, 1985.  In the case
of a Domestic Relations Order (defined below) entered by a court of competent
jurisdiction before January 1, 1985, the Committee may, in its discretion, treat
any such order as a Qualified Domestic Relations Order under this Section 11.08
even if such order does not meet the requirements therefor.

          (b)   PLAN PROCEDURES RELATIVE TO QUALIFIED DOMESTIC RELATIONS
ORDERS.

          (1)   NOTIFICATION.  Following its receipt of any Domestic Relations
                Order, the Committee shall promptly notify in writing the
                affected Participant or former Participant and Alternate
                Payee(s) of its receipt of the order, and shall furnish such
                persons a copy of the order and of these Plan procedures (and
                any other procedures which may have been adopted by


                                          25
<PAGE>

                the Committee) for determining whether the order is a Qualified
                Domestic Relations Order.  Such notice and all other notices
                pursuant to this Section 11.08 will be sent to the address
                included in the Domestic Relations Order (or to such other
                address as is known to the Committee or as may thereafter be
                specified in writing by the addressee).  Any Alternate Payee
                shall be permitted to designate a representative for receipt of
                copies of notices that are to be sent to the Alternate Payee.
                Such notice shall set a time and date no less than fifteen (15)
                days after the date of such notice on which the Committee will
                meet to determine whether the order is a Qualified Domestic
                Relations Order and shall inform the Participant and Alternate
                Payee that they may present written or oral comments at that
                time with regard to such determination.

          (2)   DETERMINATION OF COMMITTEE.  On the date specified in the above
                described notice, the Committee shall examine the Domestic
                Relations Order in light of any comments received and in light
                of applicable law and regulations, and shall make one of three
                determinations:  (i) that the order is a Qualified Domestic
                Relations Order; (ii) that the order is not a Qualified
                Domestic Relations Order; or (iii) that the determination of
                whether the order is a Qualified Domestic Relations Order
                should be submitted to and made by a court of competent
                jurisdiction.  If, within eighteen (18) months from the date on
                which the first payment of benefits would be required to be
                made under such order, it is determined by the Committee or a
                court of competent jurisdiction that the order (or modification
                thereof) is a Qualified Domestic Relations Order, then the
                Committee shall pay any separately allocated amounts (plus
                income or other allocated interest or earnings thereon) to the
                specified Alternate Payee, and thereafter shall pay the
                Alternate Payee the amount specified by the Qualified Domestic
                Relations Order.  If, within the aforesaid eighteen (18) month
                period, it is determined by the Committee or a court of
                competent jurisdiction that the order is not a Qualified
                Domestic Relations Order, or the question of whether the order
                is a Qualified Domestic Relations Order is not determined by
                the Committee or a court of competent jurisdiction, then the
                Committee shall pay any amounts (plus any income or other
                allocated interest or earnings thereon) separately accounted
                for as described below to the applicable Participant, former
                Participant or other person or persons who would have been
                entitled thereto if there had been no Domestic Relations Order.
                Any determination after the close of the aforesaid eighteen
                (18) month period shall be applied prospectively only.

          (3)   SEPARATE ACCOUNTING OF PARTICIPANT'S AND ALTERNATE PAYEE'S
                BENEFITS.  During any period in which a Participant otherwise
                would have had a


                                          26
<PAGE>


                right to payment of Plan benefits and in which the issue of
                whether an order is a Qualified Domestic Relations Order is
                being determined, the Committee shall separately account for
                the amounts as to which the Participant or former Participant
                otherwise would have had a right to payment during such period
                and the amounts which would have been payable to the Alternate
                Payee during such period if the order had been determined to be
                payable to such Alternate Payee in accordance with a Qualified
                Domestic Relations Order shall not be considered to be part of
                such Participant's Accounts with respect to any other spouse or
                Beneficiary of such Participant.

          (c)   DEFINITIONS.

          (1)   ALTERNATE PAYEE.  Any spouse, former spouse, child or other
                dependent of a Participant or former Participant who is
                recognized by a Domestic Relations Order as having a right to
                receive all, or a portion, of the benefits payable under the
                Plan with respect to such Participant or former Participant.

          (2)   DOMESTIC RELATIONS ORDER.  Any judgment, decree or order
                (including approval of a property settlement agreement) which
                relates to the provision of child support, alimony payments or
                marital property rights to a spouse, former spouse, child or
                other dependent of a Participant, and is made pursuant to a
                state's domestic relations law or community property law.

          (3)   QUALIFIED DOMESTIC RELATIONS ORDER.  A Domestic Relations Order
                which:

                (A) Creates or recognizes the existence of an Alternate
                    Payee's right to, or assigns to an Alternate Payee the
                    right to, receive all or a portion of the Plan benefits
                    payable with respect to a Participant or former
                    Participant; and

                (B) In the order clearly specifies (w) the name and last
                    known mailing address (if any) of such Participant or
                    former Participant, and of each Alternate Payee covered
                    by the order, (x) the amount or percentage of such
                    Participant's or former Participant's benefits to be
                    paid by the Plan to each Alternate Payee, or the manner
                    in which such amount or percentage is to be determined,
                    (y) the number of payments or period to which such
                    order applies and (z) each plan to which such order
                    applies; and


                                          27
<PAGE>

                (C) Does not require the Plan to provide any type or form
                    of benefit, or any option, not otherwise provided by
                    the Plan; and

                (D) Does not require the Plan to provide increased
                    benefits, determined on the basis of actuarial value;
                    and

                (E) Does not require the payment of benefits to an
                    Alternate Payee under another order previously
                    determined to be a Qualified Domestic Relations Order;
                    and

                (F) In the case of any payment before such Participant
                    has separated from Service, does not require
                    payment to the Alternate Payee before the earlier
                    of (x) the date such Participant or former
                    Participant attains age fifty (50), or (y) the
                    earliest date on which he could begin receiving
                    benefits if he separated from Service; and

                (G) Requires payment in a form provided by the Plan.  In no
                    event may payment be in the form of a joint and
                    survivor annuity with respect to an Alternate Payee and
                    his subsequent spouse.


                                          28
<PAGE>

                                     ARTICLE XII

                               DETERMINATION OF SERVICE

          12.01 CONTINUOUS SERVICE.  The term "Continuous Service" as used in
the Plan means service with the Company or any Affiliated Company, including
service prior to the adoption of the Plan, whether on a salaried or hourly
basis, calculated from the Employee's most recent employment commencement date
(which means, in the case of a Break in Continuous Service, that Continuous
Service shall be calculated from his reemployment commencement date following
the last unremoved Break in Continuous Service) to his Break in Continuous
Service in accordance with the following provisions:

          (a)   An Employee's employment commencement date shall be the first
date on which he performs an Hour of Service for the Company.

          (b)   An Employee shall incur a 1-year Break in Continuous Service
upon the completion of a 12-consecutive month period beginning on the date on
which he incurs a Break in Continuous Service as provided in Section 12.02,
during which period the Employee did not perform an Hour of Service.

          (c)   There shall be no deduction for any time lost which does not
constitute a Break in Continuous Service.

          12.02 BREAK IN CONTINUOUS SERVICE.

          (a)   An employee shall incur a Break in Continuous Service upon:

          (1)   Retirement or death;

          (2)   quit, discharge or other termination of employment by action of
                the Company; or

          (3)   failure to return to work upon expiration of an approved leave
                of absence.

          (b)   Continuous Service shall not be considered broken for any
Employee who (i) has entered the military, naval or merchant marine service of
the United States if such Employee complies with the requirements of
reemployment laws applicable to him and is reemployed; (ii) is on an approved
leave of absence; or (iii) is receiving benefits under an Employer's long-term
disability policy.

          (c)   In the case of an Employee who is absent from work for
maternity or paternity reasons, the twelve (12) consecutive month period
beginning on the first anniversary


                                          29
<PAGE>

of the first date of such absence shall not constitute a one (1) year Break in
Continuous Service.  For purposes of the previous sentence, an absence from work
for maternity or paternity reasons means an absence (i) by reason of the
pregnancy of the Employee, (ii) by reason of the birth of a child of the
Employee, (iii) by reason of the placement of the child with the Employee in
connection with the adoption of such child by such Employee, or (iv) for
purposes of caring for such child for a period beginning immediately following
such birth or placement.

          (d)   Notwithstanding any other provision in subsection (a) of this
Section 12.02, an Employee shall not be deemed to incur a Break in Continuous
Service until the expiration of the twelve (12) consecutive month period
following the date the Employee was first absent from work for any reason other
than retirement, quit or discharge, during which he did not perform an Hour of
Service for the Company or Affiliated Company.

          (e)   An Employee who incurs a Break in Continuous Service on account
of Retirement, quit or discharge and who thereafter performs an Hour of Service
with the Company within the twelve (12) consecutive month period of severance
between the break and performance of an Hour of Service for the purpose of
vesting under the Plan.

          (f)   In the case of a reemployed Employee who was not a Participant
in the Plan during his prior period of employment or in the case of a
Participant whose prior employment terminated without a Capital Accumulation,
any Continuous Service attributable to his prior period of employment will be
restored only if such aggregate number of years of Continuous Service prior to
such termination equals or exceeds the greater of (i) five (5) years or (ii) the
Employee's prior period of severance.

          12.03 AFFILIATED COMPANIES.   Notwithstanding any provisions in
Sections 12.01 and 12.02, and solely for the purposes of vesting under the Plan,
Continuous Service shall include service in the employ of any Affiliated Company
which has adopted the Plan.


                                     ARTICLE XIII

                                 PLAN ADMINISTRATION

          13.01 NAMED FIDUCIARIES.  The Committee and the Company shall each be
a "named fiduciary" within the meaning of Section 402 of ERISA, but each such
party's role as a named fiduciary shall be limited solely to the exercise of its
own authority and discretion, as defined under the terms of the Plan, to control
and manage the operation and administration of the Plan (other than authority
and discretion assigned under this Plan, or delegated pursuant thereto, to the
Trustee).  A named fiduciary may designate other persons who are not named
fiduciaries to carry out its fiduciary responsibilities hereunder, and any such
person shall become a fiduciary under the Plan with respect to such delegated
responsibilities.  In the event


                                          30
<PAGE>

of such a designation, the named fiduciary shall not be liable for an act or
omission of the designee in carrying out responsibilities delegated to him
except to the extent provided in Section 405 of ERISA.  Article IX describes
circumstances under which Participants shall be named fiduciaries for certain
purposes under the Plan.

          13.02 FIDUCIARY LIMITATIONS.  Named fiduciaries under the Plan, as
well as the Trustee and any other person who may be a fiduciary by virtue of
Section 3(21) of ERISA, shall exercise and discharge their respective powers and
duties in the following manner:

          (a)   By acting solely in the interest of the Participants and their
Beneficiaries;

          (b)   By acting for the exclusive purpose of providing benefits to
Participants and their Beneficiaries and defraying reasonable expenses of
administering the Trust Assets and Plan;

          (c)   By acting with the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent man acting in a like capacity
and familiar with such matters would use in the conduct of an enterprise of a
like character and with like aims; and

          (d)   By otherwise acting in accordance with the Plan and Trust
Agreement to the extent consistent with Title I of ERISA.

          13.03 COMPANY RESPONSIBILITIES.  The Company, acting through the
Board of Directors, shall have the authority to amend or terminate the Plan
pursuant to the provisions of Article XIV, to determine the amount of Employer
Contributions to the Plan pursuant to Article V, to appoint a Trustee and
Committee, to approve the adoption of the Plan by any other Employer and to act
as agent for any Affiliated Company which has adopted the Plan. Whenever the
Company is permitted or required to do or perform any act under the terms of
this Plan, it shall be done and performed by any officer duly authorized by the
Board of Directors.  To enable the Committee to perform its duties, the Company
shall supply completely and timely all information which the Committee may from
time to time require.

          13.04 TRUSTEE RESPONSIBILITIES.  The Trustee shall have, to the
extent set forth in the Trust Agreement, authority and discretion to receive,
hold and distribute Trust Assets, fiduciary responsibilities in connection with
the exercise of such authority and discretion and a duty to issue reports and
otherwise to account to the Company and the Committee.  All contributions under
the Plan shall be paid over to the Trustee and, together with accretions
thereto, shall be invested by the Trustee in accordance with the directions
permitted under the Plan and Trust Agreement.

          13.05 APPOINTMENT OF COMMITTEE.  The Plan will be administered by a
Committee composed of individuals appointed by the Board of Directors of the
Company to


                                          31
<PAGE>

serve at its pleasure.  A member of the Committee may be removed by the Board of
Directors at any time with or without cause upon written notice from the Board
of Directors, and any member of the Committee may resign by delivering his
written resignation to the Board of Directors.

          13.06 ORGANIZATION AND POWERS OF THE COMMITTEE.

          (a)   A majority of the members of the Committee at the time in
office may do any act which the Plan authorizes or requires the full Committee
to do, and the action of such majority of the members expressed from time to
time by a vote at a meeting, or in writing without a meeting, shall constitute
the action of the Committee and shall have the same effect for all purposes as
if assented to by all the members in office at the time.  A member of the
Committee who is also a Participant in the Plan shall not vote or act on any
matter relating solely to himself.  Any one member of the Committee may advise
the Trustee in writing with respect to any action taken by the Committee.

          The Committee, as Plan administrator, shall have complete control of
the administration of the Plan with all powers necessary to enable it properly
to carry out its duties in that respect.

          A benefit administrator may be appointed by the Committee.  The duties
of the benefit administrator may include, but shall not be limited to, the
day-to-day supervision of the Plan, handling written requests of Participants or
Beneficiaries regarding the Plan and performing any duties with respect to
claims for benefits specified by the Committee.

          The Committee and its delegates shall have sole and complete
discretion in the administration and operation of the Plan.  The determination
of the Committee as to any question involving the general administration of the
Plan, including, but not limited to, determinations regarding eligibility for
participation, entitlement to benefit distributions, calculation of benefits and
the timing and form of payment of distributions, shall be conclusive, final and
binding on all parties, including the Employer, the Trustee and Participants and
Beneficiaries.

          The Committee may appoint counsel or Plan consultants and hire or
retain agents and such clerical, medical and accounting services as it may
require in carrying out the provisions of the Plan.

          (b)   DUTIES.  The Company shall administer the Plan through the
Committee as Plan administrator.  As such, the Committee provides for the
necessary reporting and disclosure and appoints the Plan consultants and
certified public accountant.  In addition, the Committee considers appeals and
provides for general administration of the Plan as elsewhere herein provided.


                                          32
<PAGE>

          Upon the request of the Board of Directors, the Committee shall cause
to be presented to the Board of Directors a report for the past calendar year
(or applicable period thereof) on the status of the Plan and its operation.

          (c)   REIMBURSEMENT OF COMMITTEE.  The members of the Committee shall
serve without compensation for services as such. The Company, upon an equitable
basis, shall pay or reimburse the members of the Committee for all expenses
reasonably incurred by them in or about Committee business.

          (d)   CLAIMS PROCEDURE.  Any claim by a Participant or Beneficiary
shall be filed in writing with the Committee.  Any decision by the Committee
denying a claim by a Participant or a Beneficiary for benefits under the Plan
shall be communicated in writing to the Participant or Beneficiary, setting
forth the specific reasons for such denial.  Any such Participant or Beneficiary
whose claim has been denied, or his duly authorized representative, may (i)
appeal to the Committee in writing within sixty (60) days after receipt of the
notice of denial for a full review of the decision by the Committee; (ii) review
pertinent documents; and (iii) submit issues and comments in writing.  The
decision by the Committee following such review shall be made no later than
sixty (60) days after the date of receipt by the Committee of the request for
review, and shall be conclusive as to all persons affected thereby.  Such
decision shall be in writing and shall include both specific reasons for the
decision, written in a manner calculated to be understood by the claimant, and
specific references to the pertinent Plan provisions on which the decision is
based.

          13.07 INDEMNIFICATION.  The officers, directors and employees of the
Company, and the members of the Committee, shall be entitled to indemnification
by the Company to the extent permitted under the laws of the State of Minnesota
and ERISA with regard to any fiduciary liability they or any one or more of them
may incur as a named fiduciary to or in connection with the Plan to the extent
permitted under the Company's by-laws or provided in any applicable insurance
contract(s) which may be maintained by the Company, except to the extent that
such person shall be determined to be liable by a court of competent
jurisdiction for his own willful misconduct.  In addition, they each shall be
entitled to rely upon all tables, certificates and reports made by a certified
public accountant for the Plan and upon all written opinions given by any legal
counsel, to the extent it is prudent to so rely, and shall be fully protected
with respect to any action prudently taken or suffered by them in good faith
based on such reliance.  The foregoing rights of indemnification shall be in
addition to such other rights as the above persons may enjoy as a matter of law
or by reason of insurance coverage of any kind.

          To the extent permitted by law, except as limited by any written
agreement between the Company and the Committee, the Company shall indemnify and
save the Committee, as Plan administrator, the benefit administrator and members
of the Committee harmless against expenses, claims and liability arising out of
being the Plan administrator, the benefit administrator or a Committee member.
The Company shall maintain insurance against


                                          33
<PAGE>

acts or omissions of the Plan administrator, the benefit administrator and the
Committee members.


                                     ARTICLE XIV

                              AMENDMENT AND TERMINATION

          14.01 COMPANY'S RIGHT TO AMEND.  Subject to the provisions
hereinafter set forth, the Company reserves the right, at any time or from time
to time, by action of the Board of Directors, to amend in whole or in part any
or all of the provisions of this Plan; provided, however, that no such amendment
shall be made which:

          (a)   Will deprive any Participant of any benefit to which he has a
nonforfeitable right under Article X of this Plan; or

          (b)   Shall make it possible for any part of the Trust Assets or its
income to be used for, or diverted to, purposes other than for the exclusive
benefit of the Participants.  No such amendment which affects the rights, duties
or responsibilities of the Trustee may be made without the Trustee's written
consent.

          No amendment to the Plan shall decrease a Participant's Account
balances or eliminate an optional form of distribution. Notwithstanding the
preceding sentence, a Participant's Account balances may be reduced to the
extent permitted under Section 412(c)(8) of the Code.  Furthermore, no amendment
to the Plan shall have the effect of decreasing a Participant's Capital
Accumulation determined without regard to such amendment as of the later of the
date such amendment is adopted or the date it becomes effective.  If the Plan's
vesting schedule is amended, or the Plan is amended in any way that directly or
indirectly affects the computation of any Participant's nonforfeitable
percentage, or if the Plan is deemed amended by an automatic change to or from a
"top-heavy" vesting schedule, each Participant with at least five (5) years of
Service with the Employer may elect, within a reasonable period after the
adoption of the amendment or change, to have his nonforfeitable percentage
computed under the Plan without regard to such amendment or change.

          14.02 MANDATORY AMENDMENTS.  Notwithstanding the provisions of this
Article XIV, or of any other provision of this Plan, any amendment may be made,
retroactively if necessary, which the Company deems necessary or appropriate to
conform the Plan to, or to satisfy the conditions of, any law, government
regulation or ruling, and to permit the Plan to meet the requirements for
qualification under Sections 4975(e)(7) and 401(a) of the Code, and to permit
the Trust to meet the requirements for tax-exempt status under Section 501 of
the Code.  In the event that an initial favorable determination letter from the
Internal Revenue Service is denied with respect to the adoption of this Plan,
then this Plan shall at the option of the Board of Directors be declared null
and void.


                                          34
<PAGE>

          14.03 TERMINATION.  The Company shall have the right at any time to
terminate the Plan and the Trust created concurrently herewith by delivering to
the Committee written notice of such termination and by further informing the
Trustee by written notice of such termination.  Each Employer reserves the right
to terminate the participation of its Employees under the Plan.  Upon any such
termination, such action shall be taken as to render it impossible for any part
of the corpus of the Trust or income of the Plan to be at any time used for, or
diverted to, purposes other than for the exclusive benefit of Participants and
their Beneficiaries.

          14.04 EMPLOYEE NONFORFEITABLE RIGHTS.  Upon termination (or partial
termination) of the Plan within the meaning of Section 411(d)(3) of the Code or
a complete discontinuance of Employer Contributions hereunder, each Participant
(or in the case of a partial termination, each Participant affected) shall
continue to have a nonforfeitable right to one hundred (100) percent of the
balance in each of his Accounts as of the date of termination, partial
termination or complete discontinuance; provided, however, that replacement of
this Plan with a comparable plan qualified under Section 401(a) of the Code
shall not be a termination for purposes of this Section 14.04.

          14.05 DISTRIBUTION UPON TERMINATION.  In the event of termination of
the Plan pursuant to Section 14.03, the assets then held in Trust under the Plan
shall be distributed to the Participants in accordance with Article XI as if a
Break in Service occurred as of the date the Plan terminated.


                                      ARTICLE XV

                                  GENERAL PROVISIONS

          15.01 PARTICIPANTS' RIGHTS.  Neither the establishment of the Plan,
nor any modification hereof, nor the creation of any fund or account, nor the
payment of any benefits, shall be construed as giving to any Participant or
other person any legal or equitable right against the Company or an Affiliated
Company, or any officer or Employee thereof, or the Trustee, or the Committee,
except as herein provided.  The adoption and maintenance of the Plan shall not
be deemed to constitute a contract of employment or otherwise between an
Employer and any Employee, or to be a consideration for, or an inducement or
condition of, any employment.  Nothing contained herein shall be deemed to give
an Employee the right to be retained in the service of an Employer or otherwise
interfere with the right of an Employer to discharge, with or without cause, any
Employee at any time.

          15.02 SPENDTHRIFT CLAUSE.  No benefit which shall be payable out of
the Trust Assets to any Participant and/or his Beneficiary shall be subject in
any manner to any voluntary or involuntary anticipation, alienation, sale,
transfer, assignment, garnishment, pledge, encumbrance or charge, and any
attempt to anticipate any such benefit shall be void;


                                          35
<PAGE>

and no such benefit shall in any manner be liable for or subject to the debts,
contracts, liabilities, engagements or torts of any such Participant and/or his
Beneficiary nor shall it be subject to attachment or legal process for or
against such person, and the same will not be recognized by the Trustee except
to such an extent as may be required by law.  The limitations contained in this
Section 15.02 shall apply to the creation, assignment or recognition of a right
to any benefit payable with respect to a Participant pursuant to a Domestic
Relations Order unless such order is determined to be a Qualified Domestic
Relations Order as defined in Section 414(p) of the Code, and as defined in
Section 11.08(c)(3).

          15.03 COMPANY'S LIABILITY.  All Capital Accumulations will be paid
only from the Trust Assets, and neither the Company nor any Employer nor the
Committee nor the Trustee shall have any duty or liability to furnish the Trust
with any funds, securities or other assets, except as expressly provided in the
Plan.

          15.04 MERGER OR CONSOLIDATION.  In the event of a merger or
consolidation of the Plan with, or transfer in whole or in part of the Trust
Assets or liabilities to, another trust fund held under any other plan of
deferred compensation maintained or to be established for the benefit of all or
some of the Participants, Trust Assets or liabilities shall be transferred to
the other trust fund only if each Participant or Beneficiary would be entitled
to a benefit immediately after the merger, consolidation or transfer (assuming
the other plan and trust had then terminated) which is equal to or greater than
the benefit to which he would have been entitled to receive immediately before
the merger, consolidation or transfer (as if the Plan had then terminated).

          15.05 GOVERNING LAW.  This Plan shall be construed according to the
laws of the State of Minnesota and all provisions hereof shall be administered
according to, and its validity shall be determined under, the laws of such
State, except to the extent that such laws have been specifically preempted by
ERISA or other federal legislation.

          15.06 LEGAL ACTION.  In any action or proceeding involving the Trust,
or any property constituting part or all thereof, or the administration thereof,
Employees or former Employees of the Company or an Affiliated Company or the
Beneficiaries or any other person having or claiming to have an interest in the
Trust Assets or under the Plan shall not be necessary parties nor entitled to
any notice of process.

          15.07 BINDING ON ALL PARTIES.  Any applicable final judgment which is
not appealed or appealable that may be entered in any legal action or proceeding
shall be binding and conclusive on the Committee and all persons having or
claiming to have an interest in the Trust Assets or under the Plan.

          15.08 HEADINGS.  The headings of the Plan are inserted for
convenience of reference only and are not to be considered in the construction
or the interpretation of the Plan.



                                          36
<PAGE>

          15.09 SEVERABILITY OF PROVISIONS.  If any provision of the Plan is
held to be invalid or unenforceable, such invalidity or unenforceability shall
not affect any other provision, and the Plan shall be construed and enforced as
if such provision had not been included.

          15.10 SERVICE OF PROCESS.  The Committee is the designated agent of
the Plan for the service of process in connection with all matters affecting the
Plan.


                                     ARTICLE XVI

                           TOP-HEAVY COMPLIANCE PROVISIONS

          16.01 PURPOSE.  The purpose of this Article XVI of the Plan is to
comply with the special rules applicable to "top-heavy" plans contained in
Section 416 of the Code, as added by Section 240 of the Tax Equity and Fiscal
Responsibility Act of 1982, and the appropriate Regulations of the Internal
Revenue Service thereunder, including Treasury Regulation Section 1.416-1 and
successor Regulations.  The rules set forth in this Article XVI shall be
operative if the Plan is, or becomes, "top-heavy" within the meaning of
Section 416 of the Code and the Regulations thereunder.  In the event that by
statutory repeal or amendment, or regulatory change or ruling by the Internal
Revenue Service, any of the limitations or restrictions of this Article XVI are
no longer necessary in order for the Plan to meet the requirements of
Section 416 of the Code or other applicable provisions of the Code then in
effect, such limitations or restrictions shall immediately become null and void
and shall no longer apply without the necessity of further amendment to the
Plan.

          16.02 DEFINITIONS.  For purposes of this Article XVI only, the
following terms shall have the meanings set forth below:

          (a)   "Determination Date" means, as to any Plan Year, the last day
of any preceding Plan Year or, in the case of the first Plan Year, the last day
of such Plan Year.

          (b)   "Key Employee" means any Employee, or former Employee, or
Beneficiary of either, who at any time during the Plan Year or the four (4)
preceding Plan Years, is:

          (1)   an officer of an Employer having an annual Section 414(s)
                Compensation greater than the amount determined by multiplying
                one hundred fifty (150) percent of the dollar limitation under
                Section 415(c)(1)(A) of the Code;


                                          37
<PAGE>

          (2)   one of the 10 (ten) Employees owning the largest interests in
                an Employer having an annual Section 414(s) Compensation at
                least equal to the dollar limitation under Section 415(c)(1)(A)
                of the Code;

          (3)   a five (5) percent owner of an Employer; or

          (4)   a one (1) percent owner of an Employer having aggregate annual
                Section 414(s) Compensation of $50,000 or more from the
                Employer and all entities required to be aggregated with the
                Employer under Sections 414(b), (c) and (m) of the Code.

          For purposes of subparagraphs (2), (3) and (4) above, owners of an
Employer shall include those considered as owners within the meaning of
Section 318 of the Code.  In identifying the top ten (10) Employee owners under
Section 16.02(b)(2), only owners of greater than a one-half (1/2) percent
interest will be considered, and if several Employees have equal ownership
interests, those Employees with higher Section 414(s) Compensation shall be
treated as having a greater ownership interest.

          The determination of who is a Key Employee shall be made in accordance
with Section 416(i) of the Code and the Regulations thereunder, the provisions
of which are incorporated herein by reference.

          As used herein, the term non-Key Employee shall mean any employee who
is not a Key Employee.

          (c)   "Valuation Date" means the most recent Valuation Date occurring
within the twelve (12) month period ending on the Determination Date.

          16.03 DETERMINATION OF WHETHER PLAN IS "TOP-HEAVY."    The Plan will
be deemed to be "top-heavy" in any Plan Year if, as of the Determination Date,
the sum of the present value of accrued benefits of Key Employees exceeds sixty
(60) percent of the sum of the present value of accrued benefits of all
Participants, excluding former Key Employees.  As used in this Section 16.03,
the present value of accrued benefits includes the amounts attributable to
Employer Contributions allocated to the individual accounts of Participants and
former Participants.  The determination of whether the Plan is "top-heavy" and
the extent to which distributions, rollovers and transfers are taken into
account in such calculation shall be made in accordance with Section 416 of the
Code and the regulations thereunder which are herein incorporated by reference.
Furthermore, a former Participant's Account balances are to be disregarded in
determining whether the Plan is "top-heavy" unless the Participant performed any
services for an Employer within the five (5) year period ending on the
Determination Date.


                                          38
<PAGE>

          16.04 AGGREGATION GROUP OF EMPLOYER PLANS.  All corporations and
businesses that are aggregated under Sections 414(b), (c) and (m) of the Code
with the Employer must be considered with the Employer for the purposes of
determining whether the Plan is "top-heavy."  All plans of the Employer in which
a Key Employee participates, and each other stock bonus, pension or profit
sharing plan, if any, of the Employer which enables any plan in which a Key
Employee participates to meet the requirements of Section 401(a)(4) or
Section 410 of the Code, will be aggregated as a required aggregation group
within the meaning of Section 416(g) of the Code.  Each plan in the required
aggregation group will be "top-heavy" if the group is "top-heavy," and no plan
in the group will be top-heavy if the group is not "top-heavy."

          In addition, the Employer may elect to include as part of the
permissive aggregation group under Section 416(g) of the Code any plans that are
not part of a required aggregation group but that satisfy the requirements of
Sections 401(a)(4) and 410 of the Code when considered together with the plans
constituting the required aggregation group.  If the permissive aggregation
group is "top-heavy," only those plans which are part of the required
aggregation group will be subject to the additional requirements applicable to
"top-heavy" plans as herein provided.

          16.05 SPECIAL MINIMUM CONTRIBUTION BECOMING OPERATIVE IN THE EVENT
THE PLAN BECOMES "TOP-HEAVY."  In the event that the Plan shall be determined to
be "top-heavy" as to any Plan Year, the Employer Contributions allocated to the
Accounts under the Plan of a non-Key Employee for each Plan Year in which the
Plan is "top-heavy" shall equal the lesser of (a) three (3) percent of Section
414(s) Compensation for such Plan Year and (b) the largest percentage of Section
414(s) Compensation, subject to the Compensation Limitation, allocated to the
Accounts of a Key Employee under the Plan for that Plan Year.

          All Participants who have not terminated employment as of the last day
of the Plan Year must receive the minimum contribution.  Employees who (a)
failed to complete one thousand (1,000) Hours of Service during the Plan Year,
(b) declined to make mandatory contributions to the Plan or (c) would have been
excluded from the Plan because their Compensation is less than a stated amount,
must nevertheless be considered Participants for purposes of the minimum
contribution in this Section 16.05 if such Employees are required to satisfy the
coverage requirements of Section 410(b) of the Code in accordance with
Section 401(a)(5) of the Code.  The minimum contribution is determined without
regard to any Social Security contribution.

          16.06 PRE-"TOP-HEAVY" PLAN TERMINATED PARTICIPANT.  This Article XVI
shall not apply to any Participant who does not complete an Hour of Service
after the Plan becomes "top-heavy."

          16.07 SPECIAL "TOP-HEAVY" REDUCTION IN COMBINED BENEFIT AND
CONTRIBUTION LIMITATION.  In the event that the Plan shall be determined to be
"top-heavy" in any Plan Year,


                                          39
<PAGE>

the multiple applicable to the dollar limitation in the denominator of the
defined benefit fraction described in Section 7.03 of the Plan and the multiple
applicable to the dollar limitation in the denominator of the defined
contribution fraction described in Section 7.03 of the Plan shall be one (1)
rather than one and one-quarter (1.25); provided, however, that this
Section 16.07 shall not apply in the event that the Plan is not a "super
top-heavy" plan as defined in Section 16.10(a) and each Participant who is a
non-Key Employee shall receive the minimum contribution set forth in Section
16.05, except that the multiple in clause (a) of Section 16.05 shall be four (4)
percent rather than three (3) percent.

          16.08 TERMINATION OF "TOP-HEAVY" STATUS.  In the event that the Plan
shall be "top-heavy" within the meaning of Section 416 of the Code for any Plan
Year, and in a subsequent Plan Year the Plan shall cease to be "top-heavy," the
special "top-heavy" minimum contribution and Compensation Limitation Rules shall
cease to apply with respect to any Plan Year for which the Plan is not
"top-heavy"; provided, however, that in no event shall a reduction in a
Participant's nonforfeitable percentage occur by reason of a change in the
Plan's status.

          16.09 MULTIPLE "TOP-HEAVY" PLANS.  In the event that a Participant in
the Plan is also participating in a defined benefit plan maintained by an
Employer or an affiliated employer during a Plan Year in which both the Plan and
such defined benefit plan are "top-heavy," the Participant shall receive the
minimum accrued benefit under the defined benefit plan rather than the minimum
contribution provided for in this Plan.

          16.10 EFFECT OF THE PLAN BECOMING "SUPER TOP-HEAVY".

          (a)   The Plan shall be deemed to be "super top-heavy" if, as of the
most recent Valuation Date, the sum of the present value of accrued benefits for
Key Employees is more than ninety (90) percent of the sum of the present value
of accrued benefits for all Employees, excluding former Key Employees.

          (b)   In the event that the Plan shall be determined to be "super
top-heavy" in any Plan Year, the multiple applicable to the dollar limitation in
the denominator of the defined benefit fraction described in Section 7.03 of the
Plan and the multiple applicable to the dollar limitation in the denominator of
the defined contribution fraction described in Section 7.03 of the Plan shall be
one (1) rather than one and one-quarter (1.25).


                                     ARTICLE XII

                 DIRECT ROLLOVER AND ELIGIBLE ROLLOVER DISTRIBUTIONS


                                          40
<PAGE>

17.01     PURPOSE.  This Section applies to distributions made on or after
January 1, 1993.  Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a distributee's election under this Section, a distributee
may elect, at the time and in the manner prescribed by the Plan Administrator,
to have any portion of an eligible rollover distribution paid directly to an
eligible retirement plan specified by the distributee in a direct rollover.

          17.02 DEFINITIONS.

          (a)   ELIGIBLE ROLLOVER DISTRIBUTION.  An eligible rollover
distribution is any distribution of all or any portion of the balance to the
credit of the distributee, except that an eligible rollover distribution does
not include:

          (1)   Any distribution that is one of a series of substantially equal
                periodic payments (not less frequently than annually) made for
                the life (or life expectancy) of the distributee or the joint
                lives (or joint life expectancies) of the distributee and the
                distributee's designated beneficiary, or for a specified period
                of ten years or more;

          (2)   Any distribution to the extent such distribution is required
                under Section 401(a)(9) of the Code; and

          (3)   The portion of any distribution that is not includible in gross
                income (determined without regard to the exclusion for net
                unrealized appreciation with respect to employer securities).

          (b)   ELIGIBLE RETIREMENT PLAN.  An eligible retirement plan is an
individual retirement account described in Section 408(a) of the Code, an
individual retirement annuity described in Section 408(b) of the Code, an
annuity plan described in Section 403(a) of the Code, or a qualified trust
described in Section 401(a) of the Code, that accepts the distributee's eligible
rollover distribution.  However, in the case of an eligible rollover
distribution to the surviving spouse, an eligible retirement plan is an
individual retirement account or individual retirement annuity.

          (c)   DISTRIBUTEE.  A distributee includes an employee or former
employee.  In addition, the employee's or former employee's surviving spouse and
the employee's or former employee's spouse or former spouse who is the alternate
payee under a qualified domestic relations order, as defined in Section 414(p)
of the Code, are distributees with regard to the interest of the spouse or
former spouse.

          (d)   DIRECT ROLLOVER.  A direct rollover is a payment by the Plan to
the eligible retirement plan specified by the distributee.


                                          41
<PAGE>

                                    ARTICLE XVIII

                                      EXECUTION

          To record the adoption of the Plan, the Employer has caused its proper
officer to set his hand as of the 17th day of November, 1997.


                         POLARIS INDUSTRIES INC.

                         By:   /s/Michael Malone
                              --------------------------------------------------

                         Title:   Vice President and Chief Financial Officer
                                 -----------------------------------------------



                                          42



