Exhibit 10.2
WORTHINGTON INDUSTRIES, INC.
2003 STOCK OPTION PLAN
1. Purpose
The Worthington Industries, Inc. 2003 Stock Option Plan (herein
referred to as the "Plan") is intended to promote and advance the long-term
interest of Worthington Industries, Inc. ("Worthington") and its shareholders by
enabling Worthington and its Subsidiaries (collectively, the "Company") to
attract, retain and reward employees and to strengthen the mutuality of interest
between employees and Worthington's shareholders. The Plan is designed to
accomplish this purpose by granting Stock Options to selected employees thereby
providing a financial incentive to pursue the long-term growth, profitability
and financial success of the Company.
2. Definitions
When used in this Plan, the following terms have the meanings given to
them in this section unless another meaning is expressly provided elsewhere in
this Plan or clearly required by the context. When applying these definitions,
the form of any term or word will include any of its other forms.
(a) "Act" shall mean the Securities Exchange Act of 1934,
as amended.
(b) "Award" or "Awards" shall mean a grant of a Stock
Option made to a Participant under Section 6 of this Plan.
(c) "Award Agreement" means the written agreement between
Worthington and each Participant that describes the terms and
conditions of each Award.
(d) "Beneficiary" shall mean the person a Participant
designates to receive (or exercise) any Plan benefits (or rights) that
are unpaid (or unexercised) when the Participant dies. A Beneficiary
may be designated only by following the procedures described in Section
14(b). Neither the Company nor the Committee is required to infer a
Beneficiary from any other source.
(e) "Board" shall mean the Board of Directors of
Worthington.
(f) "Code" shall mean the Internal Revenue Code of 1986,
as amended, and any applicable regulations or rulings issued under the
Code.
(g) "Committee" shall mean the Board's Compensation and
Stock Option Committee (or the Board committee which succeeds to the
appropriate duties of such Compensation and Stock Option Committee)
which also constitutes a "compensation committee" within the meaning of
Treas. Reg. ss.1.162-27(c)(4). The Committee will be comprised of at
least three persons (i) each of whom is (A) an outside director, as
defined in Treas. Reg. ss.1.162-27(e)(3)(i); (B) a "non-employee"
director within the meaning of Rule 16b-3 under the Act; and (C)
"independent" for purposes of the rules of any securities exchange,
market or other quotation system on or through which the Common Shares
are then listed or traded; and (ii) none of whom may receive
remuneration from the Company in any capacity other than as a director,
except as permitted under applicable laws, rules and regulations.
(h) "Common Shares" shall mean the Common Shares, without
par value, of Worthington or any security of Worthington issued in
substitution, exchange or in lieu thereof.
(i) "Company" shall mean Worthington and its
Subsidiaries, collectively.
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(j) "Disability" shall mean, unless otherwise specified
by the Committee and reflected in the Award Agreement:
(i) With respect to any Award other than an
Incentive Stock Option, the Participant's inability to perform
his or her normal duties for a period of at least six months
due to a physical or mental infirmity; or
(ii) With respect to an Incentive Stock Option,
as defined in Code Section 22(e)(3).
(k) "Effective Date" shall mean the date this Plan is
approved by Worthington's shareholders.
(l) "Employee" shall mean any individual who, on an
applicable Grant Date, is a common law employee of the Company. A
worker who is classified as other than a common law employee but who is
subsequently reclassified as a common law employee of the Company for
any reason and on any basis will be treated as a common law employee
only from the date of that determination and will not retroactively be
reclassified as an Employee for any purpose of this Plan.
(m) "Exercise Price" shall mean the price at which a
Participant may exercise a Stock Option.
(n) "Fair Market Value" shall mean the value of one
Common Share on any relevant date, determined under the following
rules:
(i) If the Common Shares are traded on an
exchange, the reported "closing price" on the relevant date if
it is a trading day, otherwise on the next trading day;
(ii) If the Common Shares are traded
over-the-counter with no reported closing price, the mean
between the lowest bid and the highest asked prices on that
quotation system on the relevant date if it is a trading day,
otherwise on the next trading day; or
(iii) If neither (i) nor (ii) applies, the fair
market value as determined by the Committee in good faith.
(o) "Grant Date" shall mean the date as of which an Award
is granted to a Participant.
(p) "Incentive Stock Option" shall mean any Stock Option
granted pursuant to the provisions of Section 6 of this Plan that is
intended to be and is specifically designated as an "incentive stock
option" within the meaning of Section 422 of the Code.
(q) "Non-Qualified Stock Option" shall mean any Stock
Option granted under Section 6 that is not an Incentive Stock Option.
(r) "Participant" shall mean an Employee or former
Employee of the Company who has been granted an Award under this Plan
and who has an Award still outstanding.
(s) "Plan" shall mean this Worthington Industries, Inc.
2003 Stock Option Plan, as set forth herein and as it may hereafter be
amended.
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(t) "Retirement" shall mean, unless the Committee
specifies otherwise in the Award Agreement, the retirement of the
Employee under the Company's normal policies.
(u) "Stock Option" shall mean an Award to purchase Common
Shares granted pursuant to the provisions of Section 6 of this Plan.
(v) "Subsidiary" shall mean any corporation, partnership,
limited liability company, or other form of entity of which Worthington
owns, directly or indirectly, 50% or more of the total combined voting
power of all classes of stock, if the entity is a corporation or of the
capital or profits interest, if the entity is a partnership or another
form of entity; or any other entity in which Worthington has a 20% or
greater direct or indirect equity interest and which is designated a
Subsidiary by the Committee for purposes of this Plan; provided,
however, that no Employee of a Subsidiary in which Worthington has less
than a 50% direct or indirect equity interest may be granted an
Incentive Stock Option.
(w) "Ten-Percent Owner" shall mean any Employee who, at
the time an Incentive Stock Option is granted, owns more than 10% of
the outstanding voting shares of Worthington or any Subsidiary. For
purposes of determining ownership of voting shares, an Employee shall
be deemed to own all shares which are attributable to such Employee
under Section 424(d) of the Code, including, but not limited to, shares
owned, directly or indirectly, by or for the Employee's brothers and
sisters (whether by whole or half blood), spouse, ancestors and lineal
descendants.
(x) "Termination or Terminated" shall mean, unless
otherwise specified by the Committee and reflected in the Award
Agreement, cessation of the employee-employer relationship between an
Employee and the Company for any reason.
3. Participation
To become a Participant, each Employee receiving an Award must (a) sign
an Award Agreement; and (b) comply with any other terms and conditions as may be
imposed by the Committee. The prospective recipient of any Award under the Plan
shall not, with respect to such Award, be deemed to have become a Participant,
or to have any rights with respect to such Award, until and unless such
recipient shall have executed an Award Agreement or other instrument evidencing
the Award and delivered a fully executed copy thereof to Worthington, and
otherwise complied with the then applicable terms and conditions.
4. Administration
(a) Committee Duties. The Committee shall administer the
Plan and shall have all powers appropriate and necessary to that
purpose. Consistent with the Plan's objectives, the Committee may
adopt, amend and rescind rules and regulations relating to the Plan and
has complete discretion to make all other decisions (including whether
a Participant has incurred a Disability) and take or authorize actions
necessary or advisable for the administration and interpretation of the
Plan. Any action by the Committee will be final, binding and conclusive
for all purposes and upon all persons.
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(b) Consistent with the terms of the Plan, the Committee
will:
(i) Decide which Employees will be granted
Awards; and
(ii) Specify the type of Award to be granted and
the terms, not inconsistent with the Plan, upon which an Award
will be granted.
(c) Delegation. The Committee may designate persons other
than members of the Committee to carry out its responsibilities
(including, without limitation, the granting of Awards) under such
conditions and limitations as it may prescribe, except that the
Committee may not delegate its authority with regard to selection for
participation of, and the granting of Awards to, persons subject to
Section 16(a) and 16(b) of the Act or Section 162(m) of the Code.
(d) Award Agreement. At the time any Award is made,
Worthington will prepare and deliver an Award Agreement to each
affected Participant. The Award Agreement will describe:
(i) The type of Award and when and how it may be
exercised;
(ii) The effect of exercising the Award; and
(iii) Any other applicable terms and conditions affecting
the Award.
(e) Restriction on Repricing. Regardless of any other
provision of this Plan, neither the Company nor the Committee may
"reprice" (as defined under rules issued by the securities exchange,
market or other quotation system on or through which the Common Shares
then are listed or traded) any Stock Option without the prior approval
of the shareholders of Worthington.
5. Duration of, and Common Shares Subject to, Plan
(a) Term of Plan. The Plan shall become effective on the
Effective Date and shall remain in effect until terminated by the
Board, provided, however, that no Stock Option may be granted under
this Plan more than ten years after the Effective Date and no ISO may
be granted later than August 20, 2013.
(b) Common Shares Subject to Plan. The maximum number of
Common Shares in respect of which Awards may be granted under the Plan,
subject to adjustment as provided in Section 11 of the Plan, is
7,000,000 Common Shares. Notwithstanding the foregoing, in no event
shall more than 1,000,000 Common Shares be cumulatively available for
Awards of Incentive Stock Options under the Plan. No Participant may be
granted Awards under the Plan in any one calendar year with respect to
more than 250,000 Common Shares.
For the purpose of computing the total number of Common Shares
available for Awards under the Plan, there shall be counted against the
foregoing limitations the number of Common Shares subject to issuance upon
exercise or settlement of Awards as of the dates on which such Awards are
granted. The Common Shares which were previously subject to Awards shall again
be available for Awards under the Plan if any such Awards are forfeited,
terminated, unexercised before expiration, or settled in cash or otherwise than
the issuance of Common Shares. In addition, if Common Shares are used as full or
partial payment to the Company by a Participant of the Exercise Price upon
exercise of a Stock Option, the number of Common Shares so used shall again be
available for Awards under the Plan.
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Common Shares which may be issued under the Plan may be either
authorized and unissued Common Shares or previously issued Common Shares which
have been reacquired by Worthington. No fractional Common Shares shall be issued
under the Plan.
6. Grant of Stock Options
(a) Eligibility. Persons eligible for Awards under the
Plan shall consist of all Employees of the Company.
(b) Stock Options. Stock Options may be granted under the
Plan by the Committee in the form of Incentive Stock Options or
Non-Qualified Stock Options, and such Stock Options shall be subject to
the following terms and conditions and such additional terms and
conditions, not inconsistent with the express provisions of this Plan,
as the Committee shall deem desirable:
(i) Exercise Price. The Exercise Price per
Common Share purchasable under a Stock Option shall be
determined by the Committee at the time of grant, but in no
event shall the Exercise Price of a Stock Option be less than
100% of the Fair Market Value of the Common Shares on the
Grant Date of such Stock Option; provided, however, that the
Exercise Price shall not be less than 110% of the Fair Market
Value of the Common Shares on such Grant Date with respect to
any Incentive Stock Option granted to a Ten-Percent Owner.
(ii) Vesting. Unless otherwise specified by the
Committee and reflected in the Award Agreement, a Participant
may not exercise a Stock Option granted under the Plan prior
to that date which is 12 months after the Grant Date. Unless
otherwise determined by the Committee, the Participant may
exercise such Stock Option as follows:
(A) At any time after such 12 months,
as to 20% of the Common Shares originally subject to
the Stock Option;
(B) At any time after 24 months from
the Grant Date as to 40% of the Common Shares
originally subject to the Stock Option;
(C) At any time after 36 months from
the Grant Date as to 60% of the Common Shares
originally subject to the Stock Option;
(D) At any time after 48 months from
the Grant Date as to 80% of the Common Shares
originally subject to the Stock Option; and
(E) At any time after 60 months from
the Grant Date, as to 100% of the Common Shares
originally subject to the Stock Option.
(iii) Stock Option Term. Unless otherwise
specified by the Committee and reflected in the Award
Agreement, each Stock Option shall expire 10 years after the
Grant Date; provided that any Incentive Stock Option granted
to a Ten-Percent Owner shall expire no later than five years
after the Grant Date.
Subject to the other provisions of this Plan, any Stock Option which
becomes exercisable shall remain exercisable until the date of expiration of the
term of the Stock Option.
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Subject to the provisions of Section 7, a Participant may not exercise
any part of a Stock Option granted under this Plan unless, at the time of such
exercise, the Participant has been in the continuous employment of the Company
since the date such Stock Option was granted. The Committee may decide in each
case whether leaves of absence for government or military service, illness,
temporary disability or other reasons shall be deemed not to interrupt
continuous employment for purposes of this paragraph.
7. Impact of Termination
(a) Retirement. Unless otherwise specified by the
Committee and reflected in the Award Agreement, all Awards that are
outstanding and exercisable upon the Retirement of an Employee, may be
exercised at any time before the earlier of (i) the expiration date
specified in the Award Agreement or (ii) 36 months (three months in the
case of Incentive Stock Options) beginning on the Retirement Date. The
Committee may, in its sole discretion, elect to make any unvested
portion of the Award exercisable as of the Retirement date of the
Participant.
(b) Death or Disability. Unless otherwise specified by
the Committee and reflected in the Award Agreement, all Awards that are
outstanding and exercisable when an Employee is Terminated because of
death or Disability, may be exercised by the Participant or the
Participant's Beneficiary at any time before the earlier of (i) the
expiration date specified in the Award Agreement or (ii) 36 months (12
months in the case of an Incentive Stock Option) beginning on the date
of death or Termination because of Disability. The Committee may, in
its sole discretion, elect to make any unvested portion of the Award
exercisable as of the date of death or Termination for Disability.
(c) Termination. Unless otherwise specified by the
Committee and reflected in the Award Agreement, any Awards that are
outstanding when an Employee is Terminated for any reason not described
in Sections 7(a) and 7(b) will be forfeited.
8. Forfeitures
(a) Limits on Exercisability/Forfeiture of Exercised
Awards. Regardless of any other provision of this Plan and unless the
Committee specifies otherwise as reflected in the Award Agreement, a
Participant who fails to comply with this Section 8(a) will forfeit all
outstanding Awards.
The forfeiture described in this Section will apply if the Participant:
(i) Without the Committee's written consent,
which may be withheld for any reason or for no reason,
violates any non-competition covenant, employee
non-solicitation covenant, or any similar agreement or
covenant of the Participant in favor of the Company.
(ii) Deliberately engages in any action that the
Committee concludes has caused or may cause harm to the
interests of the Company;
(iii) Without the Committee's written consent,
which may be withheld for any reason or for no reason,
discloses confidential and proprietary information relating to
the Company's business affairs ("Trade Secrets"), including
technical information, product information and formulae,
processes, business and marketing plans, strategies, customer
information and other information concerning the Company's
products,
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promotions, development, financing, expansion plans, business
policies and practices, salaries and benefits and other forms
of information considered by the Company to be proprietary and
confidential and in the nature of Trade Secrets; or
(iv) Fails to return all property (other than
personal property), including keys, notes, memoranda,
writings, lists, files, reports, customer lists,
correspondence, tapes, disks, cards, surveys, maps, logs,
machines, technical data, formulae or any other tangible
property or document and any and all copies, duplicates or
reproductions that have been produced by, received by or
otherwise been submitted to the Participant in the course of
the Participant's employment with the Company.
(b) In the event a Participant or former Participant
violates any non-competition covenant, employee non-solicitation
covenant, or any similar agreement or covenant of the Participant or
former Participant in favor of the Company, the Committee, in its sole
discretion, may require such Participant or former Participant, to
return to the Company the economic value of any Award which is realized
or obtained (measured at the date of exercise) by such Participant or
former Participant at any time during the period beginning on that date
which is six months prior to the earlier of (i) the date of such
Participant's or former Participant's Termination; or (ii) the date any
such violation occurs.
9. Method of Exercise
A Stock Option may be exercised, in whole or in part, by giving written
notice of exercise to the Company specifying the number of Common Shares to be
purchased. Such notice shall be accompanied by payment in full of the Exercise
Price in cash or, if acceptable to the Committee, in its sole discretion, in
Common Shares already owned by the Participant for at least six months prior to
the exercise date or by surrendering outstanding Awards or any combination
thereof (in each case valuing Common Shares at Fair Market Value on the date of
exercise). The Committee shall determine acceptable methods for tendering Common
Shares or outstanding Awards (including by attestation if permitted by
applicable law, rules or regulations) and may impose such conditions on the use
of Common Shares or outstanding Awards to exercise Stock Options as it deems
appropriate.
10. Special Rule for Incentive Stock Options
With respect to an Incentive Stock Option granted under the Plan, the
aggregate Fair Market Value (determined as of the Grant Date of the Incentive
Stock Option) of the number of Common Shares with respect to which Incentive
Stock Options are exercisable for the first time by a Participant during any
calendar year (under all option plans of the Company) shall not exceed $100,000
or such other limit as may be required by the Code. No Incentive Stock Option
may be granted after August 20, 2013.
11. Adjustments Upon Changes In Capitalization, Etc.
(a) The existence of this Plan and the Awards granted
hereunder shall not affect or restrict in any way the right or power of
the Board or the shareholders of Worthington to make or authorize any
adjustment, recapitalization, reorganization or other change in
Worthington's capital structure or its business, any merger or
consolidation of Worthington, any issue of bonds, debentures, preferred
or prior preference shares ahead of or affecting Worthington's capital
stock or the rights thereof, the dissolution or liquidation of
Worthington or any sale or transfer of all or any part of Worthington's
assets or business, or any other corporate act or proceeding.
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(b) In the event of any change in capitalization
affecting the Common Shares of Worthington, such as a stock dividend,
stock split, recapitalization, merger, consolidation, split-up,
combination or exchange of shares or other form of reorganization, or
any other change affecting the Common Shares or the price thereof, such
proportionate adjustments, if any, as the Board in its discretion may
deem appropriate to reflect such change shall be made with respect to
the aggregate number of Common Shares for which Awards in respect
thereof may be granted under the Plan, the maximum number of Common
Shares which may be subject to Awards granted to any Participant in any
one calendar year, the number of Common Shares covered by each
outstanding Award, and the Exercise Price in respect of outstanding
Awards.
(c) The Committee may also make such adjustments in the
number of Common Shares covered by, and the price or other value of any
outstanding Awards in the event of a spin-off or other distribution
(other than normal cash dividends) of Worthington's assets to
shareholders.
12. Change in Control Provisions
(a) Effects of Change in Control. Subject to the
provisions of Section 12(c), in the event of a Change in Control (as
defined below) of Worthington, all Stock Options then outstanding shall
become fully vested and exercisable as of the date of the Change in
Control, whether or not then exercisable.
(b) Definitions.
(i) A "Change in Control" of Worthington shall
have occurred when any Acquiring Person (other than (A) the
Company, (B) any employee benefit plan of the Company or any
trustee of or fiduciary with respect to any such employee
benefit plan when acting in such capacity, or (C) any person
who, on the Effective Date of the Plan, is an Affiliate of
Worthington owning in excess of 10% of the outstanding Common
Shares of Worthington and the respective successors,
executors, legal representatives, heirs and legal assigns of
such person), alone or together with its Affiliates and
Associates, has acquired or obtained the right to acquire the
beneficial ownership of 25% or more of the Common Shares then
outstanding); or the Continuing Directors no longer constitute
a majority of the Board.
(ii) "Acquiring Person" means any person (any
individual, firm, corporation or other entity) who or which,
together with all Affiliates and Associates of such person,
has acquired or obtained the right to acquire the beneficial
ownership of twenty-five percent (25%) or more of the Common
Shares then outstanding.
(iii) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of
the General Rules and Regulations under the Act.
(iv) "Change in Control Price Per Share" shall
mean the highest price per Common Share (A) paid by the
Acquiring Person in connection with the transaction that
results in the Change in Control; or (B) paid or offered by
the Acquiring Person to acquire other Common Shares in excess
of 1% of the outstanding Common Shares, at any time after the
Change in Control and before the Participant exercises his or
her election under Section 12(c), or, in the case of a Change
in Control occurring solely by reason of events not related to
a purchase of Common Shares, the highest Fair Market Value of
a Common Share on any of the 30 consecutive trading days
ending on the last trading day before the Change in Control
occurs.
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(v) "Continuing Director" means any individual
who was a member of the Board on the Effective Date of the
Plan or thereafter elected by the shareholders of Worthington
or appointed by the Board prior to the date as of which the
Acquiring Person became an Acquiring Person or an individual
designated (before his or her initial election or appointment
as a director) as a Continuing Director by three-fourths of
the Whole Board, but only if a majority of the Whole Board
shall then consist of Continuing Directors.
(vi) "Whole Board" means the total number of
directors which Worthington would have if there were no
vacancies.
(c) Change in Control Cash-Out. Notwithstanding any other
provision of the Plan, during the 60-day period from and after a Change
in Control (the "Exercise Period"), if the Committee shall determine
at, or at any time after, the time of grant of a Stock Option, a
Participant holding a Stock Option shall have the right, whether or not
the Stock Option is fully exercisable and in lieu of the payment of the
Exercise Price for the Common Shares being purchased under the Stock
Option and by giving notice to the Company, to elect (within the
Exercise Period) to surrender all or part of the Stock Option to the
Company and to receive cash, within 30 days of such notice, in an
amount equal to the amount by which the Change in Control Price per
Share on the date of such election shall exceed the Exercise Price per
Common Share under the Stock Option (the "Spread") multiplied by the
number of Common Shares granted under the Stock Option as to which the
right granted under this Section 12(c) shall have been exercised;
provided, that if the Change in Control is within six months of the
Grant Date of a particular Stock Option held by a Participant who is an
officer or director of Worthington and is subject to Section 16(b) of
the Act, no such election shall be made by such Participant with
respect to such Stock Option prior to six months from the Grant Date.
However, if the end of such 60-day period from and after a Change in
Control is within six months of the Grant Date of a Stock Option held
by a Participant who is an officer or director of Worthington and is
subject to Section 16(b) of the Act, such Stock Option (unless
theretofore exercised) shall be canceled in exchange for a cash payment
to the Participant, effective on the day which is six months and one
day after the Grant Date of such Stock Option, equal to the Spread
multiplied by the number of Common Shares granted under the Stock
Option.
(d) Alternative Awards. Section 12(a) will not apply to
the extent that the Committee reasonably concludes in good faith before
the Change in Control occurs that Awards will be honored or assumed or
new rights substituted for the Awards (collectively, "Alternative
Awards") by the Participant's employer (or the parent or a subsidiary
of that employer) immediately after the Change in Control, provided
that any Alternative Award must:
(i) Be based on stock that is (or, within 60
days of the Change in Control, will be) traded on an
established securities market;
(ii) Provide the Participant rights and
entitlements substantially equivalent to or better than the
rights, terms and conditions of the Award for which it is
substituted, including an identical or better exercise or
vesting schedule and identical or better timing and methods of
payment; and
(iii) Have substantially equivalent economic value
to the Award (determined at the time of the Change in Control)
for which it is substituted.
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For purposes of this Section 12, a constructive Termination means a
Termination by a Participant following a material reduction in the Participant's
compensation or job responsibilities (when compared to the Participant's
compensation and job responsibilities on the date of the Change in Control) or
the relocation of the Participant's principal place of employment to a location
at least 50 miles from the Participant's principal place of employment on the
date of the Change in Control (or other location to which the Participant has
been reassigned with the Participant's written consent), in each case without
the Participant's written consent.
(e) Provisions Not Applicable. The provisions of this
Section 12 shall not apply (i) if the Committee determines at the time
of grant of an Award that such Section shall not apply in respect of
such Award or (ii) to any Change in Control when expressly provided
otherwise by a three-fourths vote of the Whole Board, but only if a
majority of the members of the Board then in office and acting upon
such matters shall be Continuing Directors.
13. Amendment, Modification and Termination of Plan
The Board or the Committee may terminate, suspend or amend the Plan at
any time without shareholder approval except to the extent that shareholder
approval is required to satisfy applicable requirements imposed by (a) Rule
16b-3 under the Act, or any successor rule or regulation, (b) applicable
requirements of the Code or (c) the rules of any securities exchange, market or
other quotation system on or through on which the Company's securities are
listed or traded. Also, no Plan amendment may (i) result in the loss of a
Committee member's status as a "non-employee director" as defined in Rule 16b-3
under the Act, or any successor rule or regulation, with respect to any employee
benefit plan of the Company, (ii) cause the Plan to fail to meet requirements
imposed by Rule 16b-3 or (iii) without the consent of the affected Participant,
adversely affect any Award granted before the amendment. However, nothing in
this Section 13 will restrict the Committee's right to exercise the discretion
retained in the various provisions of this Plan.
14. Miscellaneous
(a) Assignability. Except as described in this Section
14(a) and Section 14(b), an Award may not be transferred except by will
or the laws of descent and distribution and, during the Participant's
lifetime, may be exercised only by the Participant, the Participant's
guardian or legal representative.
(b) Beneficiary Designation. Each Participant may name a
Beneficiary or Beneficiaries (who may be named contingently or
successively) to receive or to exercise any vested Award that is
unexercised at the Participant's death. Each designation made will
revoke all prior designations made by the same Participant, must be
made on a form prescribed by the Committee and will be effective only
when filed in writing with the Committee. If a Participant has not made
an effective Beneficiary designation, the deceased Participant's
Beneficiary will be the deceased Participant's estate. The identity of
a Participant's designated Beneficiary will be based only on the
information included in the latest beneficiary designation form
completed by the Participant and will not be inferred from any other
evidence.
(c) No Guarantee of Employment or Participation. Nothing
in this Plan may be construed as: (i) interfering with or limiting the
right of the Company to Terminate any Employee's employment at any
time; (ii) conferring on any Employee any right to continue as an
employee of the Company; or (iii) guaranteeing that any Employee will
receive any Awards.
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(d) Tax Withholding. The Company will withhold from other
amounts owed to a Participant, or require the Participant to remit to
the Company, an amount sufficient to satisfy federal, state and local
withholding tax requirements on any Award, exercise or cancellation of
an Award or purchase of Common Shares. If these amounts are not to be
withheld from other payments due to the Participant (or if there are no
other payments due to the Participant), the Company will defer payment
of cash or issuance of Common Shares until the earlier of: (i) 30days
after the settlement date; or (ii) the date the Participant remits the
required amount.
If the Participant has not remitted the required amount within
30 days after the settlement date, the Company will permanently
withhold from the value of the Awards to be distributed the minimum
amount required to be withheld to comply with applicable federal, state
and local income, wage and employment taxes and distribute the balance
to the Participant.
In its sole discretion, which may be withheld for any reason
or for no reason, the Committee may permit a Participant to elect,
subject to conditions the Committee establishes, to reimburse the
Company for this tax withholding obligation through one or more of the
following methods:
(i) By having Common Shares otherwise issuable
under the Plan withheld by the Company (but only to the extent
of the minimum amount that must be withheld to comply with
applicable state, federal and local income, employment and
wage tax laws);
(ii) By delivering to the Company previously
acquired Common Shares that the Participant has owned for at
least six months;
(iii) By remitting cash to the Company; or
(iv) By remitting a personal check immediately
payable to the Company.
(e) Indemnification. Each individual who is or was a
member of the Committee or of the Board will be indemnified and held
harmless by Worthington against and from any loss, cost, liability or
expense that may be imposed upon or reasonably incurred by such
individual in connection with or resulting from any claim, action, suit
or proceeding to which such individual may be made a party or in which
such individual may be involved by reason of any action taken or
failure to take action under this Plan as a Committee member and
against and from any and all amounts paid, with Worthington's approval,
by such individual in settlement of any matter related to or arising
from this Plan as a Committee member or paid by such individual in
satisfaction of any judgment in any action, suit or proceeding relating
to or arising from this Plan against such individual as a Committee
member, but only if such individual gives Worthington an opportunity,
at its own expense, to handle and defend the matter before such
individual undertakes to handle and defend it in his or her own behalf.
The right of indemnification described in this Section 14(e) is not
exclusive and is independent of any other rights of indemnification to
which the individual may be entitled under Worthington's organizational
documents, by contract, as a matter of law or otherwise.
(f) Requirements of Law. The grant of Awards and the
issuance of Common Shares will be subject to all applicable laws, rules
and regulations and to all required approvals of any governmental
agencies or national securities exchange, market or other quotation
system. Also, no Common Shares will be issued under this Plan unless
Worthington is satisfied that the issuance of those Common Shares will
comply with applicable federal and state securities laws. Certificates
for Common Shares delivered under this Plan may be subject to any stock
transfer
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orders and other restrictions that the Committee believes to be
advisable under the rules, regulations and other requirements of the
Securities and Exchange Commission, any securities exchange or other
recognized market or quotation system upon which the Common Shares are
then listed or traded, or any other applicable federal or state
securities law. The Committee may cause a legend or legends to be
placed on any certificates issued under this Plan to make appropriate
reference to restrictions within the scope of this Section 14(f).
(g) No Right to Employment. Neither the adoption of this
Plan nor the granting of any Award shall confer upon any Employee of
the Company any right to continued employment with the Company, nor
shall it interfere in any way with the right of the Company to
Terminate any of its Employees at any time, with or without cause.
(h) Other Company Benefit and Compensation Programs.
Payments and other benefits received by a Participant under an Award
made pursuant to this Plan shall not be deemed a part of a
Participant's regular, recurring compensation for purposes of the
termination indemnity or severance pay law of any state or country and
shall not be included in, nor have any effect on, the determination of
benefits under any other employee benefit plan or similar arrangement
provided by the Company unless expressly so provided by such other plan
or arrangement, or except where the Committee expressly determines that
an Award or portion of an Award should be included to accurately
reflect competitive compensation practices or to recognize that an
Award has been made in lieu of a portion of competitive annual cash
compensation. This Plan notwithstanding, the Company may adopt such
other compensation programs and additional compensation arrangements as
it deems necessary to attract, retain and reward Employees for their
service with the Company.
(i) Cost of Plan. The costs and expenses of administering
this Plan shall be borne by the Company.
(j) Governing Law. This Plan and all rules, regulations
and actions hereunder shall be governed by and construed in accordance
with the laws (other than laws governing conflicts of laws) of the
State of Ohio and applicable federal laws.
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