ALEXANDER & BALDWIN, INC.
1998 STOCK OPTION/STOCK INCENTIVE PLAN
AMENDMENT NO. 3
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The Alexander & Baldwin, Inc. 1998 Stock Option/Stock Incentive Plan
(the "Plan") is hereby amended, effective as of February 24, 2005, as follows:
1. The references to "Compensation and Stock Option Committee" in
Paragraph A of Section III ("ADMINISTRATION OF THE PLAN") of Article One of the
Plan and in Item Q ("PLAN ADMINISTRATOR") of the Plan's Appendix are hereby
replaced with "Compensation Committee."
2. Paragraph B of Section IV ("ELIGIBILITY") of Article One of the Plan
is hereby amended in its entirety to read as follows:
"B. The Plan Administrator shall have full authority to
determine, (i) with respect to the option grants under the
Discretionary Option Grant Program, all terms and conditions thereof to
the extent not inconsistent with the express provisions of this Plan,
including but not limited to which eligible persons are to receive
option grants, the time or times when those option grants are to be
made, the number of shares to be covered by each such grant, whether
the granted option will have a reload feature, the time or times when
each option is to become exercisable, the vesting schedule (if any)
applicable to the option shares and the maximum term for which the
option is to remain outstanding and (ii) with respect to stock
issuances or share right awards under the Stock Issuance Program, all
terms and conditions thereof to the extent not inconsistent with the
express provisions of this Plan, including but not limited to which
eligible persons are to receive stock issuances or share right awards,
the time or times when such issuances or share right awards are to be
made, the number of shares to be issued to each Participant, the
vesting schedule (which in no event, (i) for time-based awards, shall
provide for vesting sooner than one-third of the shares in each of the
first three years after the grant date, and (ii) for performance-based
awards, shall provide for vesting sooner than one year after the grant
date, unless otherwise provided herein) applicable to the issued shares
and the consideration to be paid for such shares."
3. Paragraph A of Section V ("STOCK SUBJECT TO THE PLAN") of Article
One of the Plan is hereby amended in its entirety to read as follows:
"A. The stock issuable under the Plan shall be shares of
authorized but unissued or reacquired Common Stock, including shares
repurchased by the Corporation on the open market. The maximum number
of shares of Common Stock issuable over the term of the Plan shall not
exceed 4,700,000 shares. Such share reserve includes the 700,000 share
increase authorized by the Board on February 24, 2005, subject to
stockholder approval at the 2005 Annual Meeting."
4. Paragraph A.1 of Section I ("OPTION TERMS") of Article Two of the
Plan is hereby amended in its entirety to read as follows:
1. The exercise price per share shall be fixed by the Plan
Administrator but shall not be less than the Fair Market Value per
share of Common Stock on the option grant date. The Plan Administrator
shall not reprice any options.
5. Paragraph C.1.a of Section I ("TERMS AND CONDITIONS OF RELOAD
OPTIONS") of Article Three of the Plan is hereby amended in its entirety to read
as follows:
a. Unless the Plan Administrator specifies otherwise in the
instrument evidencing the reload feature, the exercise price per share
of the Common Stock purchasable under the Reload Option shall be equal
to the Fair Market Value per share of Common Stock on the Reload Grant
Date. The Plan Administrator shall have full power and authority under
this Article Three to provide in the instrument evidencing the reload
feature that the Reload Option shall have an exercise price per share
in excess of the Fair Market Value per share of Common Stock on the
Reload Grant Date in the event the Fair Market Value per share of
Common Stock on such date is not more than one hundred fifty percent
(150%) of the exercise price per share in effect at the time under the
Original Option. The Plan Administrator shall not reprice any Reload
Options.
6. The last sentence of the first paragraph of Section I ("STOCK
ISSUANCE TERMS") of Article Four of the Plan is hereby deleted, thereby
eliminating the restriction on the maximum number of shares of Common Stock that
may be issued under the Stock Issuance Program. Accordingly, the first paragraph
of Section I ("STOCK ISSUANCE TERMS") of Article Four of the Plan is hereby
amended in its entirety to read as follows:
"Shares of Common Stock may be issued under the Stock Issuance
Program through direct and immediate issuances without any intervening
option grants. Each such stock issuance, whether or not evidenced by a
Stock Issuance Agreement, shall be made in compliance with the terms
specified below. Shares of Common Stock may also be issued under the
Stock Issuance Program pursuant to share right awards that entitle the
recipients to receive those shares upon the completion of a designated
Service period or the attainment of specified performance goals, in
compliance with the terms specified below."
7. Paragraph B.1 of Section I ("STOCK ISSUANCE TERMS") of Article Four
of the Plan is hereby amended in its entirety to read as follows:
"1. The Plan Administrator may issue shares of Common Stock
under the Stock Issuance Program, provided that in no event (i) for
time-based awards, shall shares vest sooner than one-third in each of
the first three years after the grant date, and (ii) for
performance-based awards, shall shares vest sooner than one year,
unless otherwise provided herein. Alternatively, the Plan Administrator
may issue share right awards under the Stock Issuance Program that
shall entitle the recipient to receive a specified number of shares of
Common Stock upon the completion of a designated Service period or the
attainment of one or more performance goals established by the Plan
Administrator, provided that in no event (i) for time-based awards,
shall the share right awards vest sooner than one-third in each of the
first three years after the grant date, and (ii) for performance-based
awards, shall the share right awards vest sooner than one year
following the grant date, unless otherwise provided herein. Upon the
completion of such Service period or the attainment of such performance
goals, fully-vested shares of Common Stock shall be issued in
satisfaction of those share right awards."
8. Paragraph B.5 of Section I ("STOCK ISSUANCE TERMS") of Article Four
of the Plan is hereby amended in its entirety to read as follows:
"5. Should the Participant cease to remain in Service while
holding one or more unvested shares of Common Stock issued under the
Stock Issuance Program or should the performance objectives not be
attained with respect to one or more such unvested shares of Common
Stock, then those shares shall be immediately surrendered to the
Corporation for cancellation, and the Participant shall have no further
stockholder rights with respect to those shares. The Plan
Administrator, however, shall have the discretionary authority to waive
the surrender and cancellation of one or more unvested shares of Common
Stock (or other assets attributable thereto) that would otherwise occur
upon the cessation of the Participant's Service or the non-attainment
of the performance objectives applicable to those shares. Such waiver
shall result in the immediate vesting of the Participant's interest in
the shares of Common Stock as to which the waiver applies, provided
that in no event (i) for time-based awards, shall shares vest sooner
than one-third in each of the first three years since the grant date,
and (ii) for performance-based awards, shall shares vest sooner than
one year following the grant date. Such waiver may be effected at any
time, whether before the Participant's cessation of Service, or before
or after the attainment or non-attainment of the applicable performance
objectives. Notwithstanding any provision herein, the Plan
Administrator shall have the discretion to vest any unvested shares of
Common Stock upon the occurrence of (i) the Participant's normal
retirement (age 65) or approved early retirement (age 55 plus 5 years
of Service), or (ii) the Participant's termination of Service by reason
or Permanent Disability. In the event of Participant's termination of
Service by reason of death, any unvested shares of Common Stock shall
automatically vest.
9. Paragraph B.6 of Section I ("STOCK ISSUANCE TERMS") of Article Four
of the Plan is hereby amended in its entirety to read as follows:
"6. Outstanding share right awards under the Stock Issuance
Program shall automatically terminate, and no shares of Common Stock
shall actually be issued in satisfaction of those awards, if the
Service requirement for such awards is not satisfied or the performance
goals established for those awards are not attained. The Plan
Administrator, however, shall have the discretionary authority to issue
shares of Common Stock in satisfaction of one or more outstanding share
right awards as to which the designated Service requirement or
performance goals are not satisfied or attained, provided that in no
event (i) for time-based awards, shall Plan Administrator issue more
shares of Common Stock than would have been issued had there been
one-third vesting for each of the first three years since the grant
date, and (ii) for performance-based awards, shall Plan Administrator
issue more shares of Common Stock than would have been issued had there
been vesting after one year following the grant date. Notwithstanding
any provision herein, the Plan Administrator shall have the discretion
to vest any unvested shares of Common Stock upon the occurrence of (i)
the Participant's normal retirement (age 65) or approved early
retirement (age 55 plus 5 years of Service), or (ii) the Participant's
termination of Service by reason or Permanent Disability. In the event
of Participant's termination of Service by reason of death, any
unvested shares of Common Stock shall automatically vest."
10. Paragraph C of Section II ("EFFECTIVE DATE AND TERM OF THE PLAN")
of Article Five of the Plan is hereby amended in its entirety to read as
follows:
"C. No stock options granted under the Plan in respect of the
700,000 share increase authorized by the Board on February 24, 2005 may
be exercised in whole or in part, and no shares of Common Stock shall
be issued under the Stock Issuance Program on the basis of that share
increase, prior to approval of such share increase by the Corporation's
stockholders at the 2005 Annual Meeting."
11. Paragraph A of Section III ("AMENDMENT OF THE PLAN") of Article
Five of the Plan is hereby amended in its entirety to read as follows:
"A. The Board shall have the power and authority to amend or
modify the Plan in any or all respects, subject to shareholder approval
for any material amendment to the Plan or as required under applicable
law or regulation. However, no such amendment or modification shall
adversely affect the rights and obligations with respect to stock
options, share right awards or unvested stock issuances at the time
outstanding under the Plan unless the Optionee or the Participant
consents to such amendment or modification."
12. Except as modified by this Amendment No. 3, all the terms and
provisions of the Alexander & Baldwin, Inc. 1998 Stock Option/Stock Incentive
Plan shall continue in full force and effect.
13. If shareholder approval of this Amendment No. 3 is not obtained at
the 2005 Annual Meeting, this Amendment No. 3 shall terminate in its entirety
and be of no force or effect.
IN WITNESS WHEREOF, Alexander & Baldwin, Inc. has caused this Amendment
No. 3 to be executed on its behalf by its duly-authorized officers on the date
first written above.
ALEXANDER & BALDWIN, INC.
By /s/ Ruthann S. Yamanaka
Its Vice President
By /s/ Alyson J. Nakamura
Its Secretary