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Exhibit 10.E
Inland Steel Industries
INLAND 1988 INCENTIVE STOCK PLAN
AS AMENDED THROUGH JANUARY 26, 1994
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INLAND 1988 INCENTIVE STOCK PLAN
1. Purpose.
The purpose of the Inland 1988 Incentive Stock Plan (the "Plan") is to
attract and retain outstanding individuals as officers and key employees of
Inland Steel Industries, Inc. (the "Company") and its subsidiaries, and to
furnish incentives to such individuals through rewards based upon the ownership
and performance of the common stock of the Company. To this end, the Committee
hereinafter designated may grant stock options, stock appreciation rights,
restricted stock awards, and performance awards, or combinations thereof, to
officers and other key employees of the Company and its subsidiaries, on the
terms and subject to the conditions set forth in this Plan.
2. Participants.
Participants in the Plan shall consist of such officers and other key
employees of the Company and its subsidiaries as the Committee in its sole
discretion may select from time to time to receive stock options, stock
appreciation rights, restricted stock awards or performance awards, either
singly or in combination, as the Committee may determine in its sole
discretion. Any director of the Company or any of its subsidiaries who is not
also an employee of the Company or any of its subsidiaries shall not be
eligible to receive stock options, stock appreciation rights, restricted stock
awards or performance awards under the Plan. As used in the Plan, the term
"subsidiary" means (a) any corporation of which the Company owns or controls,
directly or indirectly, 50% or more of the outstanding shares of capital stock
entitled to vote for the election of directors or (b) any partnership, joint
venture, or other business entity in respect of which the Company, directly or
indirectly, has comparable ownership or control.
3. Shares Reserved under the Plan.
The maximum number of shares of common stock, $1.00 par value per share, of
the Company which may be issued pursuant to grants made under the Plan shall
not exceed 1,700,000 plus such number of shares as shall have been authorized
for issuance pursuant to the Inland 1984 Incentive Stock Plan (heretofore
approved by stockholders) and shall not have been or be issued pursuant to such
plan. Any shares subject to any grant (including any grant under the Inland
1984 Incentive Stock Plan) which terminates by expiration, cancellation or
otherwise without the issuance of such shares or without payment thereunder, or
in the case of a restricted stock award without vesting, shall again be
available for future grants under the Plan. Shares of common stock to be
issued pursuant to grants under the Plan may be authorized and unissued shares
of common stock, treasury common stock, or any combination thereof.
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4. Administration of the Plan.
The Plan shall be administered by the Compensation Committee (the
"Committee") of the Board of Directors of the Company. No member of the
Committee shall be eligible to receive any grant, or shall have been eligible
to receive any grant for at least one year prior to becoming a member, under
the Plan or any other stock option, stock appreciation rights or other
incentive stock plan of the Company or any subsidiary of the Company. Subject
to the provisions of the Plan, the Committee shall have authority (i) to
determine which employees of the Company and its subsidiaries shall be eligible
for participation in the Plan; (ii) to select employees to receive grants under
the Plan; (iii) to determine the form of grant, whether as a stock option,
stock appreciation right, restricted stock award, performance award or a
combination thereof, the number of shares or units subject to the grant, the
time and conditions of exercise or vesting, the fair market value of the common
stock of the Company for purposes of the Plan, and all other terms and
conditions of any grant; and (iv) to prescribe the form of agreement,
certificate or other instrument evidencing the grant. The Committee shall also
have authority to interpret the Plan and to establish, amend and rescind rules
and regulations for the administration of the Plan, and all such
interpretations, rules and regulations shall be conclusive and binding on all
persons.
5. Effective Date of Plan.
The Plan shall be submitted to the stockholders of the Company for approval
at the annual meeting to be held on April 27, 1988, or any adjournment thereof,
and, if approved by the affirmative vote of the holders of a majority of the
shares of common stock and Series A $2.40 Cumulative Convertible Preferred
Stock of the Company, voting as a single class, represented in person or by
proxy, shall be deemed to have become effective on the date of such approval.
6. Stock Options.
(a) Grants. Options to purchase shares of common stock of the Company,
including "incentive stock options" within the meaning of Section 422A of the
Internal Revenue Code of 1986, as amended (the "Code"), may be granted from
time to time to such officers and other key employees of the Company and its
subsidiaries as may be selected by the Committee.
(b) Terms of Options. An option shall be exercisable in whole or in such
installments and at such times as may be determined by the Committee in its
sole discretion, provided that no option shall be exercisable less than one or
more than ten years after the date of grant. The per share option price shall
not be less than 100% of the fair market value of a share of common stock of
the Company on the date the option is granted. Upon exercise,
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the option price may be paid in cash, in shares of common stock of the Company
having a fair market value equal to the option price, or in a combination
thereof.
(c) Restrictions Relating to Incentive Stock Options. To the extent
required by the Code, the aggregate fair market value (determined as of the
time the option is granted) of the common stock of the Company with respect to
which incentive stock options are exercisable for the first time by an employee
during any calendar year (under this Plan or any other plan of the Company or
any of its subsidiaries) shall not exceed $100,000.
(d) Termination of Employment. If an optionee ceases to be employed by the
Company or any of its subsidiaries by reason of (i) death, (ii) physical or
mental incapacity, (iii) retirement on or after the normal retirement date
provided for in and pursuant to any pension plan of the Company or any
subsidiary of the Company in effect at the time of such retirement, or (iv)
early retirement (with the consent of the Committee) provided for in and
pursuant to any such pension plan, any option held by such optionee may be
exercised, with respect to all or any part of the common stock of the Company
as to which such option was not theretofore exercised (whether or not such
option was otherwise then exercisable), for a period ending on the third
anniversary of the date of such cessation of employment or the date of
expiration of such option, whichever first occurs. If an optionee ceases to be
employed by the Company and any of its subsidiaries for any reason other than a
reason set forth in the immediately preceding sentence, any option held by such
optionee may be exercised for a period ending on the 30th day following the
date of such cessation of employment or the date of expiration of such option,
whichever first occurs, but only with respect to that number of shares of
common stock for which such option was exercisable immediately prior to the
date of cessation of employment.
(e) Additional Terms and Conditions. The agreement or instrument evidencing
the grant of a stock option may contain such other terms, provisions and
conditions not inconsistent with the Plan as may be determined by the Committee
in its sole discretion.
7. Stock Appreciation Rights.
(a) Grants. Rights entitling the grantee to receive cash or shares of
common stock of the Company having a fair market value equal to the
appreciation in market value of a stated number of shares of such common stock
from the date of the grant to the date of exercise, or, in the case of rights
granted in tandem with or by reference to a stock option granted prior to the
grant of such rights, from the date of grant of such related stock option to
the date of exercise, may be granted from time to time to such officers and
other key employees of the Company and its subsidiaries as may be selected by
the Committee.
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(b) Terms of Grant. Such rights may be granted in tandem with or by
reference to a related stock option, in which event the grantee may elect to
exercise either the stock option or the right, but not both, as to the shares
subject to the stock option and the right, or the right may be granted
independently of a stock option. Rights granted in tandem with or by reference
to a related stock option shall be exercisable to the extent, and only to the
extent, that the related option is exercisable, provided that no such right
(except in the case of death or physical or mental incapacity) shall be
exercisable prior to the expiration of six months following the date the right
is granted. Rights granted independently of a stock option shall be
exercisable in whole or in such installments and at such times as may be
determined by the Committee, provided that no right shall be exercisable less
than one or more than ten years after the date of grant. Further, in the event
that any employee to whom rights are granted independently of a stock option
ceases to be an employee of the Company and its subsidiaries, such rights shall
be exercisable only to the extent and upon the conditions that stock options
are exercisable in accordance with the provisions of paragraph (d) of Section 6
of the Plan. The Committee may at the time of grant or at any time thereafter
impose such additional terms and conditions on the exercise of stock
appreciation rights as it deems necessary or desirable for compliance with
Section 16(a) or Section 16(b) of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder.
(c) Payment on Exercise. Upon exercise of a stock appreciation right, the
grantee shall be paid the excess of the then fair market value of the number of
shares of common stock of the Company to which the right relates over the fair
market value of such number of shares at the date of grant of the right or of
the related stock option, as the case may be. Such excess shall be paid in
cash or in shares of common stock having a fair market value equal to such
excess, or in such combination thereof, as may be provided in the grant of such
right (which may permit the grantee to elect between cash and common stock or
to elect a combination thereof) or, if no such provision is made in the grant,
as the Committee shall determine upon exercise of the right, provided, in any
event, that the grantee shall be paid cash in lieu of any fractional share of
common stock to which such grantee would otherwise be entitled. The number of
shares which may be issued pursuant to grants under the Plan shall be reduced
in connection with the exercise of any stock appreciation right by the number
of shares with respect to which such right is exercised.
(d) Additional Terms and Conditions. The agreement or instrument evidencing
the grant of stock appreciation rights may contain such other terms, provisions
and conditions not inconsistent with the Plan as may be determined by the
Committee in its sole discretion.
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8. Restricted Stock Awards.
Restricted stock awards consisting of shares of common stock of the Company
may be made from time to time to such officers and other key employees of the
Company and its subsidiaries as may be selected by the Committee, provided that
any such employee (except an employee whose terms of employment include the
granting of a restricted stock award) shall have been employed by the Company
or any of its subsidiaries for at least six months. Such awards shall be
contingent on the employee's continuing employment with the Company or its
subsidiaries for a period to be specified in the award, which shall not be less
than one or more than ten years from the date of award, and shall be subject to
such additional terms and conditions as the Committee in its sole discretion
deems appropriate, including, but not by way of limitation, restrictions on the
sale or other disposition of such shares during the restriction period. The
Committee may in its sole discretion at the time of the award or at any time
thereafter provide for the early vesting of such award in the event of
termination of employment by retirement, death, incapacity or otherwise prior
to the end of the restriction period. The holder of a restricted stock award
shall have the right to vote the restricted shares and to receive dividends
thereon, unless and until such shares are forfeited.
9. Performance Awards.
(a) Awards. Performance awards consisting of (i) shares of common stock of
the Company, (ii) monetary units or (iii) units which are expressed in terms of
shares of common stock of the Company may be made from time to time to such
officers and other key employees of the Company and its subsidiaries as may be
selected by the Committee. Such awards shall be contingent on the achievement
over a period of not less than one or more than ten years of such corporate,
division, subsidiary, group or other objectives as shall be established by the
Committee. Such objectives may be revised by the Committee at any time and
from time to time during the performance period to take into account
significant unforeseen events or changes in circumstances. Except as may
otherwise be determined by the Committee at the time of the award or at any
time thereafter, a performance award shall terminate if the holder of the award
does not remain continuously in the employ of the Company or its subsidiaries
at all times during the applicable performance period.
(b) Rights with Respect to Shares and Share Units. If a performance award
consists of shares of common stock of the Company or units which are expressed
in terms of shares of such common stock, amounts equal to dividends otherwise
payable on a like number of shares may, if the award so provides, be converted
into additional such shares (to the extent that shares are then available for
issuance under the Plan) or credited as additional
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units and paid to the participant if and when, and to the extent that, payment
is made pursuant to such award.
(c) Payment. Payment of a performance award following the end of the
performance period, if such award consists of monetary units or units expressed
in terms of shares of common stock of the Company, may be made in cash, shares
of common stock, or a combination thereof, as determined by the Committee. Any
payment made in common stock shall be based on the fair market value of such
stock on the payment date. In the case of any payment made in whole or in part
in cash (other than amounts attributable to dividend equivalents payable in
cash), the number of shares of common stock which may be issued pursuant to
grants under the Plan shall be reduced by that number of shares of such stock
(including any fraction as a whole share) having a fair market value that is
equal to the amount of such cash.
10. Adjustments for Changes in Capitalization, Etc.
Subject to the provisions of Section 11 of the Plan, stock options, stock
appreciation rights, restricted stock awards, and performance awards shall be
appropriately adjusted by the Committee as to the number, kind and price of
shares or other consideration subject to such grants in the event of changes in
the outstanding common stock by reason of stock dividends, stock splits,
recapitalizations, reorganizations, mergers, consolidations, combinations,
exchanges or other relevant changes in capitalization occurring after the date
of the grant of any stock option, stock appreciation right, restricted stock
award or performance award. In the event of any such change in the outstanding
common stock, the maximum number of shares which may be issued pursuant to
grants under the Plan shall also be appropriately adjusted by the Committee.
No adjustment to either (i) the number or price of shares of common stock
subject to incentive stock options or (ii) the maximum number of shares which
may be issued pursuant to incentive stock options shall be permitted hereunder
to the extent that such adjustment would cause an incentive stock option to be
considered as modified or the Plan to be treated as newly adopted under the
Code.
11. Effect of Merger, Consolidation, Liquidation and Certain Other
Events.
(a) Acceleration of Benefits. In the event of a "Change of Control" as
defined in paragraph (b) of this Section 11, (i) the value of all outstanding
stock options, stock appreciation rights and restricted stock awards (whether
or not then fully exercisable or vested) shall be cashed out on the basis of
the "Change of Control Price" (as defined in paragraph (c) of this Section 11)
as of the date the Change of Control occurs, provided, however, that any stock
options or stock appreciation rights outstanding for less than six months shall
not be cashed out until six months after the
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respective date of grant, and provided, further, that the Committee may provide
for the immediate vesting instead of the cashing out of restricted stock awards
in such circumstances as it deems appropriate; and (ii) all outstanding
performance awards shall be cashed out in such manner and in such amount or
amounts as determined by the Committee in its sole discretion at the time such
awards are made.
(b) Change of Control. For purposes of this Section 11, a Change of Control
means the happening of any of the following: (i) the Company is merged into or
consolidated with another corporation, or the stockholders of the Company
approve a definitive agreement to sell or otherwise dispose of all or
substantially all of its assets or adopt a plan of liquidation, provided,
however, that a Change of Control shall not be deemed to have occurred by
reason of a transaction, or a substantially concurrent or otherwise related
series of transactions, upon the completion of which the beneficial ownership
of the voting power of the Company, the surviving corporation or corporation
directly or indirectly controlling the Company or the surviving corporation, as
the case may be, is held only by the same persons (as defined below) (although
not necessarily in the same proportion) as held the beneficial ownership of the
voting power of the Company immediately prior to the transaction or the
substantially concurrent or otherwise related series of transactions, except
that upon the completion thereof, employees or employee benefit plans of the
Company may be a new holder of such beneficial ownership; or (ii) the
"beneficial ownership" (as defined in Rule 13d-3 under the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) of securities representing 30% or
more of the combined voting power of the Company is acquired by any "person" as
defined in Sections 13(d) and 14(d) of the Exchange Act (other than any trustee
or other fiduciary holding securities under an employee benefit or other
similar stock plan of the Company); or (iii) at any time during any period of
two consecutive years, individuals who at the beginning of such period were
members of the Board of Directors of the Company cease for any reason to
constitute at least a majority thereof (unless the election, or the nomination
for election by the Company's stockholders, of each new director was approved
by a vote of at least two-thirds of the directors still in office at the time
of such election or nomination who were directors at the beginning of such
period).
(c) Change of Control Price. For purposes of this Section 11, Change of
Control Price means (i) with respect to a Change of Control by reason of a
merger or consolidation of the Company described in paragraph (b)(i) of this
Section 11 in which the consideration per share of the Company's common stock
to be paid for the acquisition of shares of common stock specified in the
agreement of merger or consolidation is all in cash, the highest such
consideration per share, (ii) with respect to a Change of Control by reason of
an acquisition of securities described in
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paragraph (b)(ii) of this Section 11, the highest price per share for any share
of the Company's common stock paid by any holder of any of the securities
representing 30% or more of the combined voting power of the Company giving
rise to the Change of Control, and (iii) with respect to a Change of Control by
reason of a merger or consolidation of the Company (other than a merger or
consolidation described in paragraph (c)(i) of this Section 11), stockholder
approval of an agreement or plan described in paragraph (b)(i) of this Section
11 or a change in the composition of the Board of Directors described in
paragraph (b)(iii) of this Section 11, the highest price per share of common
stock reported on the New York Stock Exchange Composite Tape (or, if such
shares are not traded on the New York Stock Exchange, such other principal
market on which such shares are traded) during the sixty-day period ending on
the date the Change of Control occurs, except that, in the case of incentive
stock options and stock appreciation rights relating to incentive stock
options, the holder may not receive an amount in excess of the maximum amount
that will enable such option to continue to qualify as an incentive stock
option.
12. Amendment and Termination of Plan.
The Plan may be amended by the Board of Directors of the Company in any
respect, provided that, without stockholder approval, no amendment (other than
pursuant to Section 10 of the Plan) shall increase the maximum number of shares
available for issuance under the Plan. In addition, no amendment may impair
the rights of a participant under any stock option, stock appreciation right,
restricted stock award or performance award previously granted under the Plan
without the consent of such participant, unless required by law. The Plan may
also be terminated at any time by the Board of Directors. No further grants
may be made under the Plan after termination, but termination shall not affect
the rights of any participant under, or the authority of the Committee with
respect to, any grants or awards made prior to termination.
13. Prior Plan.
Upon the effectiveness of this Plan, no further grants shall be made under
the Inland 1984 Incentive Stock Plan. The discontinuance of the Inland 1984
Incentive Stock Plan shall not affect the rights of any participant under, or
the authority of the Committee (therein referred to) with respect to, any
grants or awards made thereunder prior to such discontinuance.
14. Miscellaneous.
(a) No Right to a Grant. Neither the adoption of the Plan nor any action of
the Board of Directors or of the Committee shall be deemed to give any employee
any right to be selected as a participant or to be granted a stock option,
stock appreciation right,
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restricted stock award or performance award.
(b) Rights as Stockholders. No person shall have any rights as a stockholder
of the Company with respect to any shares covered by a stock option, stock
appreciation right, or performance award until the date of the issuance of a
stock certificate to such person pursuant to such stock option, right or award.
(c) Employment. Nothing contained in this Plan shall be deemed to confer
upon any employee any right of continued employment with the Company or any of
its subsidiaries or to limit or diminish in any way the right of the Company or
any such subsidiary to terminate his or her employment at any time with or
without cause.
(d) Taxes. The Company shall be entitled to deduct from any payment under
the Plan the amount of any tax required by law to be withheld with respect to
such payment or may require any participant to pay such amount to the Company
prior to and as a condition of making such payment. In addition, the Committee
may, in its discretion and subject to such rules as it may adopt from time to
time, permit a participant to elect to have the Company withhold from any
payment under the Plan (or to have the Company accept from the participant),
for tax withholding purposes, cash or shares of common stock of the Company,
valued at their fair market value, but in no event shall the cash or the fair
market value of the number of shares so withheld (or accepted) exceed the
amount necessary to meet the maximum Federal, state and local marginal tax
rates then in effect that are applicable to the participant and to the
particular transaction.
(e) Nontransferability. No stock option, stock appreciation right,
restricted stock award or performance award shall be transferable except by
will or the laws of descent and distribution. During the holder's lifetime,
stock options and stock appreciation rights shall be exercisable only by, and
shares subject to restricted stock awards and payments pursuant to performance
awards shall be delivered or made only to, such holder or such holder's duly
appointed legal representative.
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