Exhibit 10.1

 

IPSCO Inc.

2005 Form 10-K

 

INCENTIVE SHARE PLAN

 

IPSCO INC.

 

INCENTIVE SHARE PLAN
(amended and restated as of March 3, 2005)

 

1.             Purpose of the Plan

 

The purpose of the Incentive Share Option Plan (the “Plan”) is to assist Ipsco
Inc. (the “Corporation”) and its Subsidiaries in attracting, retaining and
motivating individuals of outstanding ability by offering stock-based incentive
rewards. The Plan is intended to motivate and reward individuals who contribute
to the Corporation’s profitability and to give those individuals a proprietary
interest in the Corporation’s growth and financial success.

 

2.             Definitions

 

As used in the Plan, the following words shall have the following meanings:

 

(a)           “affiliate”has the meaning assigned by the Securities Act.

 

(b)           “associate” has the meaning assigned by the Securities Act.

 

(c)           “Award” means an award granted to any Participant in accordance
with the provisions of the Plan in the form of Stock Options, Restricted Shares
or Performance Units, or any combination of the foregoing.

 

(d)           “Award Agreement” has the meaning ascribed thereto in Section
6(b).

 

(e)           “Beneficiary” means the beneficiary or beneficiaries designated
pursuant to Section 11 of the Plan to receive, upon the death of a Participant,
Awards of Stock Options, Restricted Shares or Performance Units issued or
payable to the Participant under the Plan.

 

(f)            “Board of Directors” means the Board of Directors of the
Corporation.

 

(g)           “Committee” means the committee described in Section 4 of the
Plan.

 

(h)           “Common Shares” means the Common Shares of the Corporation.

 

(i)            “Corporation” means IPSCO Inc. and its successors and assigns.

 

(j)            “date of ceasing to be an officer or employee” or “date of
termination of service” and all such similar expressions mean the last date of
active employment of the officer or employee and for the purposes of this Plan:

 

(i)            any period after the date on which an officer or employee has
received a notice of termination of employment; or

 

(ii)           any period during which an officer or employee is in receipt of
or eligible to receive severance pay or compensation in lieu of notice,

 

is deemed to be after the date of termination of employment.

 

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(k)           “Disability” has the meaning ascribed thereto in Section 7(j)(i).

 

(l)            “Eligible Director” means a person who is a “non-employee
director” within the meaning of Rule 16-b3 under the Exchange Act, or a person
meeting any similar requirement under any successor rule or regulation.

 

(m)          “Exchange Act” means the United States Securities Exchange Act of
1934, as amended.

 

(n)           “Exercise Price” means the price at which a holder of a Stock
Option may purchase the Common Shares issuable upon exercise of the Stock
Option.

 

(o)           “Fair Market Value” means, as of any date, the last sale price per
share of a board lot of the Common Shares on the Toronto Stock Exchange (the
“TSE”) for such date, or if there was no such sale price reported for such date,
the price on the next preceding date on which there was such a sale reported.

 

(p)           “insider” has the meaning assigned by the Securities Act and also
includes associates and affiliates of an insider for only includes a director or
senior officer of a Subsidiary or an affiliate of the Corporation if such
director or senior officer (a) in the ordinary course receives or has access to
information as to material facts or material changes concerning the Corporation
before the material facts or materials changes are generally disclosed; (b) is a
director or senior officer of a Major Subsidiary of the Corporation; or (c) is
an insider of the Corporation in a capacity other than as a director or senior
officer of the Subsidiary or affiliate.

 

(q)           “Major Subsidiary” has the meaning assigned by Canadian Securities
Administrators’ National Instrument 55-101 – “Exemption from Certain Insider
Reporting Requirements,” as amended.

 

(r)            “outstanding issue” means the number of common shares of the
Company issued and outstanding on a non-diluted basis.

 

(s)           “Participant” has the meaning ascribed thereto in Section 5.

 

(t)            “Performance Objective” has the meaning ascribed thereto in
Section 9(a).

 

(u)           “Performance Period” has the meaning ascribed thereto in Section
9(a).

 

(v)           “Performance Unit” means a performance unit awarded under Section
9 of the Plan.

 

(w)          “reserved for issuance” refers to shares which may be issued in the
future upon the exercise of Stock Options which have been granted (shares are
considered “reserved for issuance” commencing when the Stock Options are
granted, regardless of when they can be exercised).

 

(x)            “Restricted Shares” means one or more Common Shares awarded under
Section 8 of the Plan, subject to such restrictions as the Committee deems
appropriate or desirable.

 

(y)           “Restriction Period” has the meaning ascribed thereto in Section
8(a).

 

(z)            “Retirement” has the meaning ascribed thereto in Section
7(j)(ii).

 

(aa)         “Securities Act” means the Securities Act (Ontario), as amended.

 

(bb)         “Stock Option” means a stock option awarded under Section 7 of the
Plan.

 

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(cc)         “Stock Option Agreement” means an Award Agreement relating to Stock
Options.

 

(dd)         “Subsidiary” means a subsidiary of the Corporation within the
meaning of the Canada Business Corporations Act.

 

3.             Shares Subject to the Plan

 

(a)           Since the inception of the Plan, a maximum of Six Million One
Hundred Seventy-Five Thousand (6,175,000) Common Shares have been authorized for
issuance under and in accordance with the Plan. As at March 3, 2005, Four
Million Three Hundred Eighty-Four Thousand Eight Hundred Twenty-Seven
(4,384,827) of such Common Shares have been issued and Nine Hundred Fourteen
Thousand Three Hundred Fifty-Four (914,354) Common Shares are issuable upon the
exercise of all currently outstanding Stock Options and Performance Units, and
Eight Hundred Seventy-Five Thousand Eight Hundred Nineteen (875,819) Common
Shares are available for issuance in connection with subsequent grants of
Awards. No fractional common shares may be purchased or issued under the Plan.
If any Stock Option expires unexercised or is terminated, surrender or cancelled
without being exercised in whole or in part for any reason, or any Performance
Units payable in Common Shares or Restricted Shares are forfeited, then the
number of Common Shares issued or issuable, as applicable, under such forfeited,
terminated or expired Awards shall again become available for award under the
Plan.

 

(b)           In no event shall the aggregate number of Common Shares reserved
for issuance under the Plan for any one person exceed two percent (2%) of the
issued and outstanding Common Shares.

 

(c)           In no event shall:

 

(i)            the number of Common Shares issuable and issued pursuant to this
Plan and when combined with any other security based compensation arrangement of
the Corporation insiders exceed 10% of the issued and outstanding Common Shares;

 

(ii)           the number of Common Shares issuable to any one insider exceed 2%
of the total issued and outstanding Common Shares; and

 

(iii)          the number of Common Shares issuable and issued under the Plan to
non-employee members of the Board of Directors exceed 0.25% of the issued and
outstanding Common Shares of the Corporation,

 

without obtaining the approval of a majority of the votes cast at a
shareholders’ meeting.

 

4.             Administration of the Plan

 

The Plan shall be administered by the Board of Directors which shall, without
limitation, have full and final authority in its discretion, but subject to the
express provisions of the Plan, to interpret the Plan, to prescribe, amend and
rescind rules and regulations relating to it and to make all other
determinations deemed necessary or dvisable for the administration of the Plan.
The Board of Directors may delegate any or all of its authority with respect to
the administration of the Plan and any or all of the rights, powers and
discretions with respect to the Plan granted to it hereunder to the Management
Resources and Compensation Committee or such other committee of directors of the
Company as the Board of Directors may designate (the “Committee”) and upon such
delegation, the Committee, as well as the Board of Directors, shall be entitled
to exercise any or all of such authority, rights, powers and discretions with
respect to the Plan. The directors of the Company may fully participate in
voting and in other deliberations or proceedings of the Board of Directors in
respect of the Plan, notwithstanding: (i) the eligibility of the directors to
participate in the Plan; and (ii) that the directors may hold Stock Options
granted pursuant to the Plan. On and after the time that the Corporation ceases
to qualify as a “foreign private issuer” within the meaning of the Exchange Act,
unless the Board of Directors is acting as the Committee or the Board of
Directors specifically determines otherwise, each member of the Committee shall,
at the time he or she takes any action with respect to an Award under the Plan,
be an Eligible Director, provided that the mere fact that a Committee member
shall fail to

 

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qualify as an Eligible Director shall not invalidate any Award granted by the
Committee which Award is otherwise validly made under the Plan.

 

(a)           The Committee shall have full power, discretion and authority to
interpret, construe and administer the Plan and any part thereof and to make and
amend rules for carrying out the Plan, and its interpretations and constructions
thereof and actions taken thereunder shall be, except as otherwise determined by
the Board of Directors, final, conclusive and binding on all persons for all
purposes.

 

(b)           The Committee’s decisions and determinations under the Plan need
not be uniform and may be made selectively among Participants, whether or not
such Participants are similarly situated.

 

(c)           The Committee may adopt its own rules of procedure and the action
of a majority of the Committee, taken at a meeting or taken without a meeting by
a writing signed by such majority, shall constitute action by the Committee.

 

5.             Eligibility

 

Awards may be granted under the Plan to such directors and full-time or
part-time officers and employees of the Corporation and its Subsidiaries as the
Committee may from time to time designate as participants (the “Participants”)
under the Plan.

 

6.             Grant of Awards and Award Agreements

 

(a)           Subject to the provisions of the Plan and applicable law, the
Committee shall (i) determine and designate from time to time those Participants
or groups of Participants to whom Awards are to be granted; (ii) determine the
form or forms of Award to be granted to any Participant; (iii) determine the
amount or number of Stock Options, Restricted Shares or Performance Units
subject to each Award; and (iv) determine the terms and conditions of each
Award.

 

(b)           Each Award granted under the Plan shall be evidenced by a written
award agreement (“Award Agreement”). The Award Agreement shall be subject to and
incorporate the express terms and conditions, if any, required under the Plan or
otherwise provided by the Committee. Subject to Section 6(c), such terms may, at
the discretion of the Committee, include provisions to the effect that upon a
change of control, conditions or restrictions applicable to some or all of the
Stock Options, Restricted Shares or Performance Units shall be waived in whole
or in part and the vesting of all or some of the Stock Options, Restricted
Shares or Performance Units shall be accelerated.

 

(c)           All Awards that may involve the issuance of Shares in settlement
of the Award shall have a minimum vesting period of one year following the grant
of the Award.

 

7.             Terms of Stock Options

 

All Stock Options shall be granted upon and subject to the terms and conditions
hereinafter set forth.

 

(a)           Exercise Price. The exercise price for each Common Share pursuant
to the exercise of a Stock Option shall be as determined by the Committee, but
shall in no event be less than one hundred percent (100%) of the last sale price
per share of a board lot of the Common Shares on The Toronto Stock Exchange on
the last business day on which there was a trade of a board lot, prior to the
day the Stock Option is granted to such Participant.

 

(b)           Vesting. Subject to Section 6(c), the Stock Options shall vest and
become exercisable in accordance with the terms and conditions determined by the
Committee at the time of the grant as set out in the Stock Option Agreement.

 

(c)           Length of Grant. Any Stock Options granted shall expire not later
than the tenth anniversary of the date such Stock Options were granted.

 

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(d)           Non-Assignability of Stock Options. Subject to Section 11, Stock
Options shall not be transferable or assignable (whether absolutely or by way of
mortgage, pledge or other charge) by a Participant other than by will or other
testamentary instrument, the laws of succession or other laws of general
application and may be exercisable during the lifetime of the Participant only
by such Participant.

 

(e)           Right to Postpone Exercise. Each Participant, upon becoming
entitled to exercise a Stock Option in respect of any Common Shares in
accordance with the Stock Option Agreement, shall thereafter be entitled to
exercise the Stock Option to purchase any such Common Shares at any time prior
to the expiration or other termination of the Stock Option Agreement or the
Stock Option rights granted thereunder in accordance with the Plan or Stock
Option Agreement.

 

(f)            Exercise of Payment. Any Stock Option may be exercised by a
Participant or the legal representative of a Participant giving notice to the
Corporation specifying the number of Common Shares in respect of which such
Stock Option is being exercised, accompanied by payment (by certified cheque,
bank draft or other instrument acceptable to the Corporation, to be payable to
the Corporation) of the entire exercise price (determined in accordance with the
Stock Option Agreement) for the number of shares specified in the notice. Upon
any such exercise of a Stock Option by a Participant the Corporation shall cause
the transfer agent of Common Shares of the Corporation to promptly deliver to
such Participant or the legal representative of such Participant, as the case
may be, a share certificate in the name of such Participant or the legal
representative of such Participant, as the case may be, representing the number
of shares specified in the notice.

 

(g)           Rights of Participants. The Participants shall have no rights
whatsoever as shareholders in respect of any of the Common Shares subject to the
Stock Option (including, without limitation, any right to receive dividends or
other distributions, voting rights, warrants or rights under any rights
offering) other than Common Shares in respect of which Participants have
exercised their Stock Option to purchase and which have been issued by the
Corporation.

 

(h)           Third Party Offer. If at any time when a Stock Option remains
unexercised with respect to any Common Shares, a general offer to purchase all
of the issued shares of the Corporation is made by a third party, the
Corporation shall use its best efforts to bring such offer to the attention of
the Participants as soon as practicable and the Corporation may, at its option,
require the acceleration of the time for the exercise of the Stock Options
granted under the Plan and of the time for the fulfillment of any conditions or
restrictions on such exercise.

 

(i)            Termination. If a Participant is dismissed as an officer or
employee by the Corporation or any of its subsidiaries for cause, all
unexercised Stock Options of that Participant under the Plan shall immediately
become terminated and shall lapse notwithstanding the original term of any Stock
Option granted to such Participant under the Plan.

 

(j)            Disability or Retirement. If a Participant ceases to be an
employee (and if such Participant is an officer, such Participant ceases to be
an officer) of the Corporation (and, if such Participant is an employee or
officer of any Subsidiary of the Corporation, such Participant also ceases to be
an employee or officer of any such Subsidiary) as a result of:

 

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

 

(ii)           retirement at the normal retirement age prescribed by the
Corporation pension plan of which the Participant is a member (“Retirement”); or

 

(iii)          such other circumstances as may be approved by the Committee,

 

such Participant shall have the right for a period of three (3) years (or until
the normal expiry date of any Stock Options of such Participant if earlier) from
the date of ceasing to be an officer or employee to exercise any unexpired Stock
Options to the extent they were exercisable on the date of ceasing to be an
officer or employee. Upon the expiration of such three (3) year period (or such
shorter period, if applicable), all unexercised Stock Options of that
Participant shall immediately become terminated and shall lapse notwithstanding
the original term of

 

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any Stock Options granted to such Participant. This Section 7(j) shall not apply
to any officer or employee that is a director of the Corporation or any of its
subsidiaries after the time that such officer or employee ceases to be an
officer or employee of the Corporation and of its subsidiaries.

 

(k)           Deceased Participant. In the event of the death of any Participant
(other than a director of the Corporation or any of its subsidiaries who is not
an officer or employee of the Corporation or any of its subsidiaries), the legal
representative of such deceased Participant shall have the right for a period of
three (3) years (or until the normal expiry date of any Stock Options of such
deceased Participant if earlier) from the date of death of such deceased
Participant to exercise any unexpired Stock Options of such deceased Participant
to the extent they were exercisable on the date of death. Upon the expiration of
such three (3) year period (or such shorter period, if applicable), all
unexercised Stock Options of such deceased Participant shall immediately become
terminated and shall lapse notwithstanding the original term of any Stock
Options granted to such deceased Participant under the Plan.

 

In the event of the death of any Participant who is a director of the
Corporation or any of its Subsidiaries and who is not an officer or employee of
the Corporation or any of its subsidiaries, the legal representative of such
deceased Participant shall have the right for a period of one (1) year (or until
the normal expiry date of any Stock Options of such deceased Participant if
earlier) from the date of death of such deceased Participant to exercise any
unexpired Stock Options of such deceased Participant to the extent they were
exercisable on the date of death. Upon the expiration of such one (1) year
period (or such shorter period, if applicable), all unexercised Stock Options of
such deceased Participant shall immediately become terminated and shall lapse
notwithstanding the original term of any Stock Options granted to such deceased
Participant under the Plan.

 

(l)            Other Termination. If a Participant ceases to be an employee (and
if such Participant is an officer, such Participant ceases to be an officer) of
the Corporation (and, if such Participant is an employee or officer of any
Subsidiary of the Corporation, such Participant also ceases to be an employee or
officer of any such Subsidiary) for a reason other than those specified in
Section 7(i), 7(j) or 7(k) hereof, such Participant shall have the right for a
period of sixty (60) days (or until the normal expiry date of any Stock Options
of such Participant if earlier) from the date of ceasing to be an officer or
employee to exercise any unexpired Stock Options to the extent they were
exercisable on the date of ceasing to be an officer or employee. Upon the
expiration of such sixty (60) day period (or such shorter period, if
applicable), all unexercised Stock Options of that Participant shall immediately
become terminated and shall lapse notwithstanding the original term of any Stock
Options granted to such Participant under the Plan. This Section 7(l) shall not
apply to any officer or employee that is a director of the Corporation or any of
its Subsidiaries after the time that such officer or employee ceases to be an
officer or employee of the Corporation and its Subsidiaries.

 

(m)          Ceasing to be a Director. If a Participant ceases to be a director
(and, if such Participant is a director of any of the subsidiaries of the
Corporation, such Participant also ceases to be a director of any such
Subsidiary) of the Corporation for any reason other than as specified in Section
6(k) hereof, such Participant shall have the right for a period of one (1) year
(or until the normal expiry date of the Stock Option rights of such Participant
if earlier) from the date of ceasing to be a director to exercise any
outstanding Stock Options to the extent they were exercisable on the date of
ceasing to be a director of the Corporation and its Subsidiaries. Upon the
expiration of such one (1) year period (or such shorter period, if applicable),
all unexercised Stock Options of that Participant shall immediately become
terminated and shall lapse notwithstanding the original term of any Stock
Options granted to such Participant under the Plan. This Section 7(m) shall not
apply to any director of the Corporation or any of its Subsidiaries that is an
officer or employee of the Corporation or any of its Subsidiaries after the time
such person ceases to be a director of the Corporation and its Subsidiaries.

 

(n)           Discretion to Extend Exercise Period. In the case of any Stock
Option Agreement in respect of Stock Options which have been granted previously
and are outstanding and which are held by any Participant (other than a director
of the Company or any of its subsidiaries who is not an officer or employee of
the Company or any of its subsidiaries), the Board of Directors shall have the
authority to determine in its sole discretion to extend any exercise period of
one (1) year that is specified in such Stock Option Agreement to apply following
Disability, Retirement, other special circumstances, or the death of the
Participant as described in sections 7(j) and 7(k) herein, by up to an
additional two (2) years (or until the normal expiry date of the Stock Option if
earlier).

 

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8.             Restricted Shares

 

(a)           Restricted Shares shall be subject to a restriction period (after
which restrictions shall lapse), which period shall be determined by the
Committee at its sole discretion (the “Restriction Period”) provided that the
Restriction Period shall not be less than one year. The Committee may provide
for the lapse of restrictions in installments where deemed appropriate. The
Committee may, at its discretion, provide that the Restricted Shares shall be
subject to Performance Objectives (as such term is defined in Section 9).

 

(b)           Except when the Committee determines otherwise pursuant to Section
8(d), if a Participant terminates employment with the Corporation and all
Subsidiaries for any reason before the expiration of the Restriction Period or
the achievement of the specified Performance Objectives, if any, all Restricted
Shares still subject to restriction shall be forfeited by the Participant and
shall be reacquired by the Corporation.

 

(c)           Except as otherwise provided in this Section 8, no Restricted
Shares received by a Participant shall be sold, exchanged, transferred, pledged,
hypothecated or otherwise disposed of during the Restriction Period.

 

(d)           Subject to the minimum Restriction Period of one year, in cases of
death, Disability or Retirement of a Participant or other special circumstances,
the Committee may, in its sole discretion when it finds that a waiver would be
in the best interests of the Corporation, elect to waive any or all remaining
restrictions or extend the Restriction Period applicable to the Restricted
Shares held by that Participant.

 

(e)           The Committee may require, under such terms and conditions as it
deems appropriate or desirable, that the certificates for Restricted Shares
delivered under the Plan may be held in custody by a bank or other institution,
or that the Corporation may itself hold such shares in custody until the
Restriction Period expires or until restrictions thereon otherwise lapse, and
may require, as a condition of any Award of Restricted Shares that the
Participant shall have delivered a stock power endorsed in blank relating to the
Restricted Shares.

 

(f)            Nothing in this Section 8 shall preclude a Participant from
exchanging any Restricted Shares subject to the restrictions contained herein
for other Common Shares that are similarly restricted.

 

(g)           Subject to Section 8(e) and Section 10, each Participant entitled
to receive Restricted Shares under the Plan shall be issued a certificate for
such shares. Such certificate shall be registered in the name of the
Participant, and shall bear an appropriate legend reciting the terms, conditions
and restrictions, if any, applicable to such Award and shall be subject to
appropriate stop-transfer orders.

 

(h)           Except for the restrictions on Restricted Shares under this
Section 8, each Participant who receives Restricted Shares shall have the rights
of a shareholder with respect to such shares, including the right to vote the
shares and receive dividends and other distributions.

 

9.             Performance Units

 

(a)           Subject to the provisions of the Plan, the Committee shall (i)
determine and designate from time to time those Participants or groups of
Participants to whom Awards of Performance Units are to be made; (ii) determine
the Performance Period (the “Performance Period”) and Performance Objectives
(the “Performance Objectives”) applicable to such Awards; (iii) determine the
form of settlement of a Performance Unit pursuant to Section 9(f); and (iv)
generally determine the terms and conditions of each such Award. The Award
Agreement covering such Performance Units shall specify a value for each
Performance Unit or a formula for determining the value of each Performance Unit
at the time of settlement.

 

(b)           The Committee shall determine a Performance Period at its sole
discretion, provided that the Performance Period for any Award that may involve
the issuance of Shares shall not be less than one year. Performance Periods may
overlap and Participants may participate simultaneously with respect to
Performance Units for which different Performance Periods are prescribed.

 

(c)           The Committee shall determine the Performance Objectives of Awards
of Performance Units. Performance Objectives may vary from Participant to
Participant and between groups of Participants and shall be

 

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based upon such performance criteria or combination of factors as the Committee
may deem appropriate, including, but not limited to, minimum earnings, earnings
per share, earnings growth, earnings per share growth, return on equity or share
price appreciation. If during the course of a Performance Period, there shall
occur significant events that the Committee expects to have a substantial effect
on the applicable Performance Objectives during such period, the Committee may
revise such Performance Objectives.

 

(d)           At the beginning of a Performance Period, the Committee shall
determine for each Participant or group of Participants the number of
Performance Units in respect of which the Participant or member of the group of
Participants shall be entitled to payment if the applicable Performance
Objectives are met in whole or in part during the Performance Period.

 

(e)           If a Participant terminates service with the Corporation and all
Subsidiaries during a Performance Period because of death, Disability,
Retirement, or under other circumstances where the Committee in its sole
discretion finds that a waiver would be in the best interests of the
Corporation, that Participant may, as determined by the Committee, be entitled
to a payment in respect of an Award of Performance Units at the end of the
Performance Period based upon the extent to which the Performance Objectives
were satisfied during such period, and such other factors as the Committee deems
relevant, and, if the Committee deems appropriate, prorated for the portion of
the Performance Period during which the Participant was employed by the
Corporation or any Subsidiary, provided, however, the Committee may provide for
an earlier payment in settlement of such Performance Units in such amount and
under such terms and conditions as the Committee deems appropriate or desirable;
or alternatively, the Committee may extend the Performance Period for such
Participant. If a Participant terminates service with the Corporation and all
Subsidiaries during a Performance Period for any reason, other than death,
Disability or Retirement, then such Participant shall not be entitled to any
payment in respect of an Award of Performance Units for that Performance Period
unless the Committee shall otherwise determine.

 

(f)            Each payment in respect of an Award of a Performance Unit to
which a Participant becomes entitled upon satisfying the applicable Performance
Objectives during the Performance Period shall be settled in whole Common
Shares, or cash, or a combination of Common Shares and cash either as a lump sum
payment or in annual installments, all as the Committee shall determine, with
payment to commence as soon as practicable after satisfaction of the relevant
Performance Objective or at the end of the relevant Performance Period as set
out in the Award Agreement.

 

(g)           Where Common Shares are issued in settlement of Performance Units,
such shares shall be valued at their Fair Market Value on the date the relevant
Performance Objective is achieved or on the last day of the relevant Performance
Period as set out in the Award Agreement and the value of the Performance Units
to which the Participant is entitled shall be divided by such Fair Market Value
of a common Share in order to determine the number of Common Shares to which the
Participant is entitled in settlement of such Performance Units.

 

(h)           No Participant awarded a Performance Unit shall have any right as
a shareholder with respect to any shares covered by the Award prior to the date
such shares have been recorded on the Corporation’s official shareholder records
as having been issued or transferred to the Participant.

 

10.          Certificates for Common Shares

 

(a)           The Corporation shall not be required to issue or deliver any
certificates for Common Shares pursuant to any Award prior to: (i) the listing
of such shares on any stock exchange on which the Common Shares may then be
listed; and (ii) the completion of any registration or qualification of such
shares under any Canadian or United States federal, provincial or state law, or
any ruling or regulation of any government body which the Corporation shall, in
its sole discretion, determine to be necessary or advisable or the Corporation
being satisfied that appropriate exemptions are available.

 

(b)           All certificates for Common Shares delivered under the Plan shall
also be subject to such stop-transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations, and other
requirements of applicable securities regulatory authorities, any stock exchange
upon which the Common Shares are then listed and any applicable federal, state
or local securities laws, and the Committee may cause a legend or legends to be
placed on any such certificates to make appropriate reference to such
restrictions.

 

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11.          Beneficiary Designation

 

(a)           Each Participant may file with the Corporation a written
designation of one or more persons as the Beneficiary or Beneficiaries who shall
be entitled upon the Participant’s death to receive the benefits of any Award
payable or granted to the Participant under the Plan. Subject to the
requirements of law, a Participant may from time to time revoke or change the
Beneficiary designation without the consent of any prior Beneficiary by filing a
new designation with the Corporation. The last such designation received by the
Corporation shall be controlling; provided, however, that no designation, or
change or revocation thereof, shall be effective unless received by the
Corporation prior to the Participant’s death, and in no event shall it be
effective as of a date prior to such receipt.

 

(b)           If no such Beneficiary designation is in effect at the time of a
Participant’s death, or if no designated Beneficiary survives the Participant or
if such designation conflicts with applicable law, the Participant’s estate
shall be entitled to receive the benefits of any Award held by the Participant,
as such benefits are determined in accordance with this Plan, upon the
Participant’s death. If the Committee is in doubt as to the right of any person
to receive the benefits of such Award, the Corporation may retain such benefits,
without liability for any interest thereon, until the Committee determines the
rights thereto, or the Corporation may pay such benefits into any court of
appropriate jurisdiction and such payment shall be a complete discharge of the
liability of the Corporation therefor.

 

12.          Transfers and Leaves of Absence

 

Solely for the purposes of the Plan: (a) a transfer of a Participant’s
employment without an intervening period from the Corporation to a Subsidiary or
vice versa, or from one Subsidiary to another, shall not be deemed a termination
of employment; and (b) a Participant who is granted in writing a leave of
absence in accordance with the applicable policies of the Corporation shall be
deemed to have remained in the employ of the Corporation or a Subsidiary, as the
case may be, during such leave of absence.

 

13.          Stock Adjustments

 

In the event of a share dividend, share split, issuance of shares or instruments
convertible into shares (other than pursuant to the Plan) for less than market
value, share consolidation, share reclassification, exchange of shares,
recapitalization, amalgamation, merger, consolidation, corporate arrangement,
reorganization, liquidation or the like of or by the Corporation, the Committee
may make such adjustment, if any, of the number of Common Shares, or of the
exercise price, or both, as it shall deem appropriate to give proper effect to
such event, including to prevent, to the extent possible, substantial dilution
or enlargement of rights granted to Participants under the Plan. In any such
event, the maximum number of shares available under the Plan may be
appropriately adjusted by the Committee subject to obtaining all necessary
regulatory approvals. If because of a proposed merger, amalgamation or other
corporate arrangement or reorganization, the exchange or replacement of shares
in the Corporation for those in another company is imminent, the Committee may,
in a fair and equitable manner, determine the manner in which all unexercised
Stock Option rights and other Awards granted under the Plan shall be treated
including, for example, requiring the acceleration of the time for the exercise
of such rights by the Participants and of the time for the fulfilment of any
conditions or restrictions on such exercise or waiving conditions or
restrictions on such Awards in whole or in part. The determination by the
Committee as to the terms of any of the foregoing adjustments shall be
conclusive and binding.

 

14.          Withholding

 

The Corporation shall have the right to deduct from any cash payment made under
the Plan any federal, provincial, state or other taxes required by law to be
withheld with respect to such payment. It shall be a condition to the obligation
of the Corporation to deliver Common Shares upon the exercise of any Stock
Option, upon payment of a Performance Unit or upon delivery of Restricted Shares
that the Participant pay to the Corporation such amount as may be requested by
the Corporation for the purpose of satisfying any liability for such withholding
taxes. Any Award Agreement may provide that the Participant may elect, in
accordance with any conditions set forth in such Award Agreement, to pay a
portion or all of such withholding taxes in Common Shares in such manner as the
Corporation may specify.

 

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15.          Amendment and Termination

 

(a)           Subject to paragraph (b), the Committee may amend, suspend, or
discontinue the Plan at any time, provided that all necessary regulatory
approvals are obtained and no such action shall adversely affect any Awards
already granted to a Participant without the consent of that Participant, except
to the extent, if any, provided in the Plan or in the Award. If any law,
agreement or exchange on which Common Shares of the Corporation are traded
requires shareholder approval for an amendment to become effective, no such
amendment shall become effective unless approved by vote of the Corporation’s
shareholders.

 

(b)           Notwithstanding paragraph (a), any amendment to the Plan involving
a fundamental change to the Plan shall become effective only upon approval by
vote at a meeting of shareholders of the Corporation. For greater certainty, an
amendment involving a fundamental change to the Plan includes an amendment which
may lead to significant dilution in the number of the Corporation’s outstanding
Common Shares or may provide additional benefits to eligible insider
participants, such as (i) any amendment involving an increase in the maximum
number of Common Shares issuable under the Plan; (ii) any amendment involving a
change to the eligible participants which would have the potential of broadening
or increasing insider participation; (iii) any amendment involving the addition
of any form of financial assistance; (iv) any amendment involving the addition
of a cashless exercise feature, payable in cash or securities, which does not
provide for a full deduction of the number of underlying Common Shares; and (v)
any amendment involving a reduction in the pricing of an option, restricted
share or performance unit, other than in connection with a Common Share split,
subdivision or other similar Common Share reorganization. Amendments to the Plan
involving, (x) any amendment of an administrative or a “housekeeping” nature;
(y) any amendment involving a change in the vesting provisions under the Plan;
and (z) an amendment involving a change to the termination provisions to the
Plan which does not entail an extension beyond the original expiry date, may be
made by the Committee in accordance with paragraph (a).

 

16.          Effective Date

 

This amendment and restatement of the Plan shall be effective as of March 3,
2005, subject to its approval by the shareholders of the Corporation. No
Restricted Shares or Common Shares in payment of Performance Units may be issued
under the Plan until such shareholder approval is obtained. If shareholder
approval is not obtained, the Incentive Share Option Plan, in its form prior to
this amendment and restatement, shall continue in effect. Stock Options granted
prior to March 3, 2005 shall continue to be governed by the terms and conditions
in effect immediately prior to this amendment and restatement of the Plan.

 

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