Exhibit 10.16

 

IPSCO Inc.

2005 Form 10-K

 

RESTRICTED SHARE AWARD AGREEMENT

 

THIS AGREEMENT made as of the 24th day of July, 2003

 

B E T W E E N:

 

IPSCO INC., a corporation incorporated under the laws of Canada,

 

(hereinafter called the “Company”)

 

 

OF THE FIRST PART

 

- and -

 

DAVID S. SUTHERLAND, of the City of Naperville, in the State of Illinois,

 

(hereinafter called the “Participant”)

 

 

OF THE SECOND PART

 

WHEREAS the Company has established an Incentive Share Option Plan (which, as
amended from time to time by the Board of Directors of the Company, shall
hereinafter be called the “Plan”) whereby certain designated officers, employees
and directors of the Company and its subsidiaries, may from time to time be
granted options, restricted shares and performance units;

 

AND WHEREAS the Participant, as an officer of the Company, has been so
designated to receive a grant of restricted shares of the Company, being common
shares (the “Common Shares”), which are to be issued subject to the restrictions
set forth herein (the “Restricted Shares) and of the Plan;

 

NOW, THEREFORE, THIS AGREEMENT WITNESSETH that in consideration of the mutual
covenants herein contained the parties do hereby agree as follows:

 

1.                                                                                     
Grant

 

Subject to and conditional upon compliance with the applicable requirements of
each stock exchange on which the Common Shares of the Company are listed and of
any governmental authority or regulatory body to which the Company is subject,
the Company hereby awards, and issues to and in the name of the Participant an

 

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aggregate of Thirty-Five Thousand (35,000) Restricted Shares of the Company on
the terms set out in this Agreement.

 

2.                                                                                     
Restriction Period

 

From the date hereof until the restrictions on the Restricted Shares set forth
herein terminate (the “Restriction Period”), the Restricted Shares shall not be
sold, exchanged, transferred, pledged, hypothecated or otherwise disposed of;
provided, however, that any of the Restricted Shares may be exchanged for any
other Common Shares of the Company that are similarly restricted.

 

Subject to any earlier termination of the Restriction Period as provided in this
Agreement and the provisions of Section 4 hereof, the Restriction Period shall
terminate with respect to one hundred per cent (100%) of the Restricted Shares
upon the earlier of

 

(a)                                  the date of a Change of Control, and

 

(b)                                 July 23, 2006, provided that the Company
has, for the period beginning July 1, 2003 and ending on June 30, 2006, achieved
positive cumulative net income (as calculated on a consolidated basis in
accordance with Canadian generally accepted accounting principles) attributable
to the Common Shares,

 

and thereupon the Restricted Shares shall be free of the restrictions contained
in this Agreement (and thereafter shall be referred to as the “Shares”).

 

For the purposes of this Section 2, the date of a Change of Control means the
date on which any one of the following occurs:  (i) any person or group of
persons acting in concert acquires beneficial ownership (within the meaning of
The Securities Act (Saskatchewan)) of 20% or more of the outstanding Common
Shares of the Company, or securities convertible into 20% or more of the
outstanding Common Shares on a post-conversion basis; (ii) during a period of
not more than 24 months, a majority of the Board of Directors ceases to consist
of the existing membership or successors nominated by the existing membership or
their similar successors; (iii) all or substantially all of the individuals and
entities who were the beneficial owners of the Company’s outstanding securities
entitled to vote do not own more than 50% of such securities in substantially
the same proportions following a shareholder approved reorganization, merger, or
consolidation; or (iv) shareholder approval of either (A) a complete liquidation
or dissolution of the Company or (B) a sale or other disposition of all or
substantially all of the assets of the Company, or a transaction having a
similar effect.

 

3.                                                                                     
Restricted Share Certificates

 

The Participant agrees that at any time prior to the termination of the
Restricted Period, the Company may request that a certificate representing the
Restricted Shares be issued with such legend thereon as the Company may require.
Any such certificate shall be issued at the cost of the Company. The Company
shall retain possession of any certificates issued representing the Restricted
Shares until the later to

 

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occur of the termination of the Restricted Period and the termination of the
security interest described in Section 6.

 

4.                                                                                     
Termination of Employment

 

(a)           If the Participant ceases to be an employee of the Corporation and
all Subsidiaries before the expiration of the Restriction Period as a result of:

 

(i)                                     disability or illness preventing the
Participant from performing the duties routinely performed by the Participant;

 

(ii)                                  retirement at the normal retirement age
prescribed by the Company retirement benefit or pension plan of which the
Participant is a member;

 

(iii)                               death of the Participant; or

 

(iv)                              such other circumstances as may be approved by
the Board of Directors;

 

the Participant shall be deemed, for the purposes of this Agreement, to be
employed by the Company or Subsidiary, on the last day of the Restriction Period
(or, if earlier, the date of a Change of Control).

 

(b)           If the Participant ceases to be an employee of the Corporation and
all Subsidiaries in any circumstances other than as described in paragraph (a)
of this Section 4 and Section 9 hereof (including termination by the Company
with or without cause and termination by the Participant), all Restricted Shares
still subject to restriction shall be forfeited by the Participant and shall be
reacquired by the Corporation.

 

5.                                                                                     
Rights of Restricted Shareholder

 

Except as set forth in this Agreement, upon the issuance of the Restricted
Shares a Participant shall have all of the rights of a shareholder, including
the right to vote the Restricted Shares and the right to receive dividends
thereon. The Company shall issue the Participant’s Restricted Shares upon
execution of this Agreement, the listing (or authorization of listing upon
official notice of issuance) of the Restricted Shares upon each stock exchange
upon which the Common Shares are listed and there has been compliance with such
laws and regulations as the Company may deem applicable. The Company agrees to
use reasonable commercial efforts to effect such listing and compliance.

 

6.                                                                                     
Withholding Taxes

 

The Participant agrees to pay the Company, or otherwise make arrangements
satisfactory to the Company regarding the payment of any federal, state or local
taxes required or authorized by law to be withheld with respect to the award of
Restricted Shares or the termination of the Restriction Period (the “Withholding
Taxes”). The Company shall have, to the extent permitted by law, the right to
deduct from any

 

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payment of any kind otherwise due the Participant, any Withholding Taxes and to
condition the delivery of the Common Shares after the termination of the
Restriction Period on the payment to the Company of the Withholding Taxes. The
Participant hereby grants to the Company a security interest in the Restricted
Shares to secure reconveyance of the Restricted Shares to the Company upon any
deemed donation to the Company and to ensure adequate provision for the
Withholding Taxes. The Company shall release its security interest in respect of
any Restricted Shares as to which (i) the Restriction Period has terminated and
(ii) all Withholding Taxes have been paid. In lieu of payment of such amounts in
cash, the Participant may pay all or a portion of the Withholding Taxes by (a)
delivery of Common Shares not subject to any Restriction Period or (b) having
the Company withhold a portion of the Common Shares otherwise to be delivered
upon expiration of the Restriction Period.

 

7.                                                                                     
Other Distributions

 

If any distribution is made to the holders of Common Shares other than a cash
dividend, or if new, different or additional shares or other securities of the
Company or of another company are received by holders of Common Shares, or if
any recapitalization or reclassification, split-up or consolidation of the
Common Shares shall be effected, or, if in connection with a merger or
consolidation of the Company or a sale by the Company of all or a part of its
assets, the Common Shares are exchanged for a different number or class of
shares of stock or other securities of the Company or for shares of stock or
securities of any other company, then any such other securities shall be subject
to similar restrictions as the Restricted Shares, shall be subject to the
security interest provided for in Section 6 and the number and class of
Restricted Shares, and the restrictions, terms and other conditions applicable
to any such other securities shall be equitably determined by the Management
Resources and Compensation Committee.

 

8.                                                                                     
No Further Rights

 

Nothing contained in this Agreement shall confer upon the Participant any right
to continued employment with the Company, or affect the right of the Company to
terminate the employment of the Participant, with or without cause.

 

9.                                                                                     
Leave of Absence

 

If the Participant is an employee of the Company and is granted a temporary
leave of absence from the Company, such leave of absence shall be deemed a
continuation of the employment of the Participant provided if and so long as:

 

(a)                                  the Company consents in writing to such
leave of absence, and

 

(b)                                 the Participant thereafter returns to
full-time employment with the Company for a period of six months,
notwithstanding the possible expiration of the Restriction Period.

 

For greater certainty, the provisions of subsection (b) of Section 9 shall be
subject to (i) immediate vesting on the occurrence of a Change of Control as
described in Section 2 and (ii) the deemed continuous employment provisions of
Section 4.

 

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10.                                                                              
Notice

 

All notices, demands, payments or other communications which may or are required
to be given under this Agreement shall be given in writing by personal delivery
or ordinary prepaid mail:

 

(a)

 

to the Company:

 

 

 

 

 

IPSCO Inc.

 

 

650 Warrenville Road

 

 

Suite 500

 

 

Lisle, IL  60532

 

 

 

 

 

Attention:

Vice President, General Counsel and Corporate Secretary

 

 

 

(b)

 

to the Participant:

 

 

 

 

 

David Sutherland

 

 

Naperville, IL

 

or such other address as any party may give in writing from time to time. Such
notices if given by mail shall be deemed to have been received by the party to
whom they are addressed as described herein seventy-two (72) hours after they
have been put in the post, postage prepaid, provided that if postal services are
disrupted by labour disputes, such mailed notices shall be deemed to have given
and received on the date of actual receipt by the addressee.

 

11.                                                                              
Plan to Apply

 

The parties agree that the provisions of the Plan shall be complementary to and
read in conjunction with the terms of this Agreement and in the event of any
contradiction or inconsistency between any provisions of the Plan and those of
this Agreement, the Plan shall prevail.

 

12.                                                                              
Dispute

 

Any dispute or disagreement which shall arise under, or as a result of, or in
any way relate to, the interpretation, construction or application of this
Agreement shall be determined by the Board of Directors of the Company and any
such determination shall be final, binding and conclusive for all purposes.

 

13.                                                                              
Further Assurances

 

The Participant shall forthwith and from time to time do all such acts and
things and execute and deliver all such instruments, writings and assurances as
may be necessary to carry out this Agreement in accordance with its true intent.

 

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14.                                                                              
Enurement

 

This Agreement shall be binding and shall enure to the benefit of the parties
hereto and their successors, executors and administrators.

 

15.                                                                              
Governing Law

 

This Agreement shall be governed by the laws of the State of Illinois.

 

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day
and year first above written.

 

 

 

IPSCO INC.

 

 

 

 

 

Per:

/s/ Robert Ratliff

 

 

 

 

 

 

Per:

/s/ George H. Valentine

 

 

 

 

 

 

 

/s/ David S. Sutherland

 

 

 

David S. Sutherland

 

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