Edgar Filing: RYERSON TULL INC /DE/ - Form DEF 14A
Gary J. Niederpruem 29 years and Thomas S. Cygan 37 years. Until December 31, 2002, they were subject to limits on certain company-paid contributions to employees accounts under the Ryerson Tull Savings Plan.
Certain pension benefits in excess of the limitations imposed by the Internal Revenue Code of 1986 are paid by Ryerson Tull under an unfunded non-contributory supplemental retirement plan. For any officer or employee who is age 55 or older with at least five years of service and annual compensation in excess of $170,000, these plans generally permit us to satisfy obligations to pay benefits upon retirement at age 65 by (a) purchasing annuities (and paying a tax gross-up to the officer or employee) or (b) paying a lump sum amount at the time of retirement. No annuities were established for named executive officers in 2002.
In the event of a change in control (as defined in the applicable plan), all benefits accrued under the pension plan and the supplemental plans will become fully and irrevocably vested and distributable to participants as provided by the terms of those plans. If, within three years following a change in control, there is a termination of the Ryerson Tull Pension Plan, or a substantial reduction in accruals under the Ryerson Tull Pension Plan, assets will first be used to provide retiree medical benefits and then will be applied to increase retirement benefits to affected participants on a pro rata basis. Special rules also apply if, after a change in control, the Ryerson Tull Pension Plan is merged with another plan or if assets are transferred from the Ryerson Tull Pension Plan to another plan. This distribution would occur within three years of a change in control, and, within this three-year period, there are limitations on amendments to the Ryerson Tull Pension Plan.
Employment and Change in Control Agreements and Other Benefits
Under our incentive stock plans, upon the occurrence of a change in control event, (i) the value of all outstanding stock options, stock appreciation rights and restricted stock awards (whether or not then fully exercisable or vested) will be cashed out at specified prices as of the date of the change in control, except that (a) certain stock options or stock appreciation rights outstanding for less than six months will not be cashed out until six months after the grant date and (b) restricted stock awards may immediately vest; and (ii) all outstanding performance awards will be cashed out in the amounts and manner determined by the Compensation Committee.
We have entered into change in control agreements with each of the named executive officers, the present terms of which expire on December 31, 2003, but which are automatically extended for additional one-year periods thereafter, unless we give notice prior to June 30 that we do not wish to extend such agreements for another year or unless a change in control (as defined below) or other limited events occur. We have not given such notice of nonrenewal to date.
For purposes of the agreements, a change in control shall generally be deemed to occur if:
any person becomes the owner of 20% or more of the combined voting power of our then-outstanding securities;
during any two-year period, the majority of the Board changes without the approval of two-thirds of the directors who either were
directors at the beginning of the period or whose election was previously so approved;
(3) a merger or consolidation with another company occurs, in which our voting securities, in combination with voting securities held by any trustee or fiduciary under any employee benefit plan, do not continue to represent at least 60% of the combined voting power of the voting securities of the surviving entity;