Edgar Filing: RYERSON TULL INC /DE/ - Form DEF 14A
Plan as deductible for federal income tax purposes for tax years commencing January 1, 2003, the Ryerson Tull Annual Incentive Plan (the Plan ). The summary of the Plan which follows is qualified in its entirety by reference to the complete text of the Plan as set forth in Exhibit A.
All full-time salaried employees of the Company, Joseph T. Ryerson & Son, Inc., and J. M. Tull Metals Company, Inc., and of any affiliate, subsidiary, division or group of the Company designated from time to time by the Compensation Committee (the
Committee ) (each, a Corporate Unit ) as of the first and last day of a quarterly award period or, with respect to award periods that extend for at least one year, as of August 1 of the first year of an award period and the last day of an award period (except as otherwise provided by the Committee) are eligible to be designated as participants in the Plan for the applicable award period. As of December 31, 2002, approximately 830 employees were eligible to participate in the Plan. Except in the case of death, disability, retirement or change of control, a participant must be an employee as of the last day of an award period to be eligible for an award. The Committee determines and designates from time to time those eligible employees who will be participants in any award period and may adopt criteria restricting the number of full-time salaried employees eligible to be designated as Plan participants for any applicable award period. The Committee may determine and establish from time to time an award period applicable to any specified Corporate Unit or salary classification or grade, or combination thereof, which award period may be a calendar quarter, a calendar year or a longer period. Notwithstanding any other provision of the Plan to the contrary, the Committee may impose such conditions on participation in and awards under the Plan as it deems appropriate, including conditions applicable to one or more participants that are intended to cause awards payable under the Plan to be deductible for purposes of Section 162(m) of the Internal Revenue Code. Such conditions include (but are not limited to) conditions that may subject payment of awards to further stockholder approval of the Plan. The Committee shall have sole discretion, however, to make such changes without stockholder approval and, in the event that the Committee determines that it is advisable to grant awards under the Plan to named executive officers that do not qualify as deductible under Section 162(m), the Committee may make such grants upon performance measures it deems appropriate.
For each award period, the Committee must establish (i) the minimum performance required by a Corporate Unit before an award may be paid to a participant employed in such Corporate Unit, (ii) for each participant, a Target Award expressed as a percentage of base salary earnings or base annual salary for each such participant for such award period, on the basis of the individual s salary grade classification, and (iii) an award schedule for each Corporate Unit. The Plan permits minimum performance to be based upon return on operating assets, operating profit, return on equity, net income, stock price, revenue growth, marginal income, expense management, inventory management, quality management, customer service performance, shareholder return, gross margin management, market share improvement, safety results, quality results, price margin management, on-time delivery, productivity and days sales outstanding (accounts receivable management). The Committee has established the minimum performance for 2003 of each Corporate Unit based on a combination of one or more of the following: return on operating assets, customer service performance, inventory management, expense management, gross margin management, price margin management, on-time delivery and market share improvement.
No award will be paid to any participant in a Corporate Unit which in any award period did not achieve the minimum performance established for such Corporate Unit. The award for each participant in a Corporate Unit is the percentage of such individual s Target Award determined in accordance with the applicable award schedule; provided, however, that subject to Plan provisions limiting discretion of the Committee, the Committee may adjust awards on the basis of quantitative and qualitative performance measures and evaluations as it deems appropriate and may make