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    Exhibit 10(iii)(b)



 




    COMMERCIAL
    METALS COMPANY



 




    2006
    LONG-TERM EQUITY INCENTIVE PLAN



 



    The Commercial Metals Company 2006 Long-Term Equity Incentive
    Plan (the “Plan”) was adopted by the
    Board of Directors of Commercial Metals Company, a Delaware
    corporation (the “Company”), effective
    as of November 6, 2006 (the “Effective
    Date”), subject to approval by the
    Company’s stockholders



 




    ARTICLE 1

    



 




    PURPOSE
    



 



    The purpose of the Plan is to attract and retain the services of
    key management and employees of the Company and its Subsidiaries
    and to provide such persons with a proprietary interest in the
    Company through the granting of incentive stock options,
    nonqualified stock options, stock appreciation rights,
    restricted stock, restricted stock units, performance awards,
    and other awards, whether granted singly, or in combination, or
    in tandem, that will



 



    (a) increase the interest of such persons in the
    Company’s welfare;



 



    (b) furnish an incentive to such persons to continue their
    services for the Company; and



 



    (c) provide a means through which the Company may attract
    able persons as employees.



 



    With respect to Reporting Participants, the Plan and all
    transactions under the Plan are intended to comply with all
    applicable conditions of
    Rule 16b-3
    promulgated under the Securities Exchange Act of 1934 (the
    “1934 Act”). To the extent any
    provision of the Plan or action by the Committee fails to so
    comply, it shall be deemed null and void ab initio, to
    the extent permitted by law and deemed advisable by the
    Committee.



 




    ARTICLE 2

    



 




    DEFINITIONS
    



 



    For the purpose of the Plan, unless the context requires
    otherwise, the following terms shall have the meanings indicated:



 



    2.1  “Award” means the grant of any
    Incentive Stock Option, Nonqualified Stock Option, Reload
    Option, Restricted Stock, SAR, Restricted Stock Units,
    Performance Award, or Other Award, whether granted singly or in
    combination or in tandem (each individually referred to herein
    as an “Incentive”).



 



    2.2  “Award Agreement” means a
    written agreement between a Participant and the Company which
    sets out the terms of the grant of an Award.



 



    2.3  “Award Period” means the period
    set forth in the Award Agreement during which one or more
    Incentives granted under an Award may be exercised.



 



    2.4  “Board” means the board of
    directors of the Company.



 



    2.5  “Change in Control” means any of
    the following events:



 



    (a) Any Person becomes the “beneficial owner” (as
    defined in
    Rule 13d-3
    or
    Rule 13d-5
    under the Exchange Act), directly or indirectly, of 25% or more
    of the combined voting power of the Company’s then
    outstanding voting securities;



 



    (b) The Incumbent Board ceases for any reason to constitute
    at least the majority of the Board; provided, however, that any
    person becoming a director subsequent to the Agreement Date
    whose election, or nomination for election by the Company’s
    shareholders was approved by a vote of at least 75% of the
    directors comprising the Incumbent Board (either by a specific
    vote or by approval of the proxy statement of the Company in
    which such person is named as a nominee for director, without
    objection to such nomination)




    

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    shall be, for purposes of this subsection (b), considered
    as though such person were a member of the Incumbent Board;



 



    (c) All or substantially all of the assets of the Company
    are sold, transferred or conveyed and the transferee of such
    assets is not controlled by the Company (control meaning the
    ownership of more than 50% of the combined voting power of such
    entity’s then outstanding voting securities); or



 



    (d) The Company is reorganized, merged or consolidated, and
    the shareholders of the Company immediately prior to such
    reorganization, merger or consolidation own in the aggregate 50%
    or less of the outstanding voting securities of the surviving or
    resulting corporation or entity from such reorganization, merger
    or consolidation.



 



    Notwithstanding anything in the foregoing to the contrary, no
    Change in Control shall be deemed to have occurred for purposes
    of this Agreement by virtue of any transaction (i) which
    results in the Executive or a group of Persons, which includes
    the Executive, acquiring, directly or indirectly, 15% or more of
    the combined voting power of the Company’s then outstanding
    voting securities; or (ii) which results in the Company,
    any affiliate of the Company or any profit-sharing plan,
    employee stock ownership plan or employee benefit plan of the
    Company or any Affiliates (or any trustee of or fiduciary with
    respect to any such plan acting in such capacity) acquiring,
    directly or indirectly, 15% or more of the combined voting power
    of the Company’s then outstanding voting securities. For
    purposes of this section, the term “Incumbent Board”
    means the individuals who as of the Agreement Date constitute
    the Board, and the term “Person” means any natural
    person, firm, corporation, government, governmental agency,
    association, trust or partnership.



 



    Notwithstanding the foregoing provisions of this
    Section 2.5, in the event an Award issued under the
    Plan is subject to Section 409A of the Code, then, in lieu
    of the foregoing definition and to the extent necessary to
    comply with the requirements of Section 409A of the Code,
    the definition of “Change in Control” for purposes of
    such Award shall be the definition provided for under
    Section 409A of the Code and the regulations or other
    guidance issued thereunder.



 



    2.6  “Code” means the Internal
    Revenue Code of 1986, as amended.



 



    2.7  “Committee” means the
    compensation committee of the Board or such other committee as
    shall be appointed or designated by the Board to administer the
    Plan in accordance with Article 3 of this Plan.



 



    2.8  “Common Stock” means the common
    stock, par value $.01 per share, which the Company is
    currently authorized to issue or may in the future be authorized
    to issue, or any securities into which or for which the common
    stock of the Company may be converted or exchanged, as the case
    may be, pursuant to the terms of this Plan.



 



    2.9  “Company” means Commercial
    Metals Company, a Delaware corporation, and any successor entity.



 



    2.10  “Corporation” means any entity
    that (i) is defined as a corporation under
    Section 7701 of the Code and (ii) is the Company or is
    in an unbroken chain of corporations (other than the Company)
    beginning with the Company, if each of the corporations other
    than the last corporation in the unbroken chain owns stock
    possessing a majority of the total combined voting power of all
    classes of stock in one of the other corporations in the chain.
    For purposes of clause (ii) hereof, an entity shall be
    treated as a “corporation” if it satisfies the
    definition of a corporation under Section 7701 of the Code.



 



    2.11  “Date of Grant” means the
    effective date on which an Award is made to a Participant as set
    forth in the applicable Award Agreement.



 



    2.12  “Employee” means common law
    employee (as defined in accordance with the Regulations and
    Revenue Rulings then applicable under Section 3401(c) of
    the Code) of the Company or any Subsidiary of the Company.



 



    2.13  “Fair Market Value” means, as
    of a particular date, (a) the closing sales price per share
    on the New York Stock Exchange Consolidated Tape, or such
    reporting service as the Committee may select, on the
    appropriate date, or in the absence of reported sales on such
    day, the most recent previous day for which sales were reported,
    (b) if the shares of Common Stock are not so reported but
    are quoted on the NASDAQ Stock Market, the closing sales price
    per share of Common Stock on the NASDAQ Stock Market on that
    date, or, if there shall have been no such sale so




    

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    reported on that date, on the last preceding date on which such
    a sale was so reported, (c) if the Common Stock is not so
    listed or quoted, the mean between the closing bid and asked
    price on that date, or, if there are no quotations available for
    such date, on the last preceding date on which such quotations
    shall be available, as reported by NASDAQ, or, if not reported
    by NASDAQ, by the National Quotation Bureau, Inc., or
    (d) if none of the above is applicable, such amount as may
    be determined by the Committee (acting on the advice of an
    Independent Third Party, should the Committee elect in its sole
    discretion to utilize an Independent Third Party for this
    purpose), in good faith, to be the fair market value per share
    of Common Stock.



 



    2.14  “Incentive” is defined in
    Section 2.1 hereof.



 



    2.15  “Independent Third Party” means
    an individual or entity independent of the Company having
    experience in providing investment banking or similar appraisal
    or valuation services and with expertise generally in the
    valuation of securities or other property for purposes of this
    Plan. The Committee may utilize one or more Independent Third
    Parties.



 



    2.16  “Incentive Stock Option” means
    an incentive stock option within the meaning of Section 422
    of the Code, granted pursuant to this Plan.



 



    2.17  “Nonqualified Stock Option”
    means a nonqualified stock option, granted pursuant to this
    Plan, which is not an Incentive Stock Option.



 



    2.18  “Option Price” means the price
    which must be paid by a Participant upon exercise of a Stock
    Option to purchase a share of Common Stock.



 



    2.19  “Other Award” means an Award
    issued pursuant to Section 6.8 hereof.



 



    2.20  “Participant” means an Employee
    of the Company or a Subsidiary to whom an Award is granted under
    this Plan.



 



    2.21  “Performance Award” means an
    Award hereunder of cash, shares of Common Stock, units or rights
    based upon, payable in, or otherwise related to, Common Stock
    pursuant to Section 6.7 hereof.



 



    2.22  “Performance Goal” means any of
    the goals set forth in Section 6.9 hereof.



 



    2.23  “Plan” means this Commercial
    Metals Company 2006 Long-Term Equity Incentive Plan, as amended
    from time to time.



 



    2.24  “Reporting Participant” means a
    Participant who is subject to the reporting requirements of
    Section 16 of the 1934 Act.



 



    2.25  “Restricted Stock” means shares
    of Common Stock issued or transferred to a Participant pursuant
    to Section 6.4 of this Plan which are subject to
    restrictions or limitations set forth in this Plan and in the
    related Award Agreement.



 



    2.26  “Restricted Stock Units” means
    units awarded to Participants pursuant to
    Section 6.6 hereof, which are convertible into
    Common Stock at such time as such units are no longer subject to
    restrictions as established by the Committee.



 



    2.27  “Retirement” means any
    Termination of Service solely due to retirement upon or after
    attainment of age sixty-two (62), or permitted early retirement
    as determined by the Committee.



 



    2.28  “SAR” or “stock
    appreciation right” means the right to receive an
    amount, in cash
    and/or
    Common Stock, equal to the excess of the Fair Market Value of a
    specified number of shares of Common Stock as of the date the
    SAR is exercised (or, as provided in the Award Agreement,
    converted) over the SAR Price for such shares.



 



    2.29  “SAR Price” means the exercise
    price or conversion price of each share of Common Stock covered
    by a SAR, determined on the Date of Grant of the SAR.



 



    2.30  “Stock Option” means a
    Nonqualified Stock Option, a Reload Stock Option or an Incentive
    Stock Option.




    

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    2.31  “Subsidiary” means (i) any
    corporation in an unbroken chain of corporations beginning with
    the Company, if each of the corporations other than the last
    corporation in the unbroken chain owns stock possessing a
    majority of the total combined voting power of all classes of
    stock in one of the other corporations in the chain,
    (ii) any limited partnership, if the Company or any
    corporation described in item (i) above owns a majority of
    the general partnership interest and a majority of the limited
    partnership interests entitled to vote on the removal and
    replacement of the general partner, and (iii) any
    partnership or limited liability company, if the partners or
    members thereof are composed only of the Company, any
    corporation listed in item (i) above or any limited
    partnership listed in item (ii) above.
    “Subsidiaries” means more than one of any such
    corporations, limited partnerships, partnerships or limited
    liability companies.



 



    2.32  “Termination of Service” occurs
    when a Participant who is an Employee of the Company or any
    Subsidiary ceases to serve as an Employee of the Company and its
    Subsidiaries, for any reason. If, however, a Participant who is
    an Employee and who has an Incentive Stock Option ceases to be
    an Employee but does not suffer a Termination of Service, and if
    that Participant does not exercise the Incentive Stock Option
    within the time required under Section 422 of the Code upon
    ceasing to be an Employee, the Incentive Stock Option shall
    thereafter become a Nonqualified Stock Option. Notwithstanding
    the foregoing provisions of this Section 2.32, in
    the event an Award issued under the Plan is subject to
    Section 409A of the Code, then, in lieu of the foregoing
    definition and to the extent necessary to comply with the
    requirements of Section 409A of the Code, the definition of
    “Termination of Service” for purposes of such Award
    shall be the definition of “separation from service”
    provided for under Section 409A of the Code and the
    regulations or other guidance issued thereunder.



 



    2.33  “Total and Permanent
    Disability” means a Participant is qualified for
    long-term disability benefits under the Company’s or
    Subsidiary’s disability plan or insurance policy; or, if no
    such plan or policy is then in existence or if the Participant
    is not eligible to participate in such plan or policy, that the
    Participant, because of a physical or mental condition resulting
    from bodily injury, disease, or mental disorder is unable to
    perform his or her duties of employment for a period of six
    (6) continuous months, as determined in good faith by the
    Committee, based upon medical reports or other evidence
    satisfactory to the Committee; provided that, with
    respect to any Incentive Stock Option, Total and Permanent
    Disability shall have the meaning given it under the rules
    governing Incentive Stock Options under the Code.
    Notwithstanding the foregoing provisions of this
    Section 2.33, in the event an Award issued under the
    Plan is subject to Section 409A of the Code, then, in lieu
    of the foregoing definition and to the extent necessary to
    comply with the requirements of Section 409A of the Code,
    the definition of “Total and Permanent Disability” for
    purposes of such Award shall be the definition of
    “disability” provided for under Section 409A of
    the Code and the regulations or other guidance issued thereunder.



 




    ARTICLE 3

    



 




    ADMINISTRATION
    



 



    Subject to the terms of this Article 3, the Plan
    shall be administered by the compensation committee of the Board
    or such other committee of the Board as is designated by the
    Board to administer the Plan (the
    “Committee”). The Committee shall
    consist of not fewer than two persons. Any member of the
    Committee may be removed at any time, with or without cause, by
    resolution of the Board. Any vacancy occurring in the membership
    of the Committee may be filled by appointment by the Board. At
    any time there is no Committee to administer the Plan, any
    references in this Plan to the Committee shall be deemed to
    refer to the Board.



 



    If necessary to satisfy the requirements of Section 162(m)
    of the Code
    and/or
    Rule 16b-3
    promulgated under the 1934 Act, membership on the Committee
    shall be limited to those members of the Board who are
    “outside directors” under Section 162(m) of the
    Code and/or
    “non-employee directors” as defined in
    Rule 16b-3
    promulgated under the 1934 Act. The Committee shall select
    one of its members to act as its Chairman. A majority of the
    Committee shall constitute a quorum, and the act of a majority
    of the members of the Committee present at a meeting at which a
    quorum is present shall be the act of the Committee.



 



    The Committee shall determine and designate from time to time
    the eligible persons to whom Awards will be granted and shall
    set forth in each related Award Agreement, where applicable, the
    Award Period, the Date of Grant, and such other terms,
    provisions, limitations, and performance requirements, as are
    approved by the Committee, but




    

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    not inconsistent with the Plan. The Committee shall determine
    whether an Award shall include one type of Incentive or two or
    more Incentives granted in combination or two or more Incentives
    granted in tandem (that is, a joint grant where exercise of one
    Incentive results in cancellation of all or a portion of the
    other Incentive). Although the members of the Committee (other
    than members of the Committee who are outside directors or
    non-employee directors) shall be eligible to receive Awards, all
    decisions with respect to any Award, and the terms and
    conditions thereof, to be granted under the Plan to any member
    of the Committee shall be made solely and exclusively by the
    other members of the Committee, or if such member is the only
    member of the Committee, by the Board. Notwithstanding anything
    herein to the contrary, the Committee has the authority to
    request senior management to recommend any employees under their
    supervision to whom Awards may be granted under the Plan;
    provided that the Committee shall consider, but shall not be
    bound by, such recommendations.



 



    The Committee, in its discretion, shall (i) interpret the
    Plan, (ii) prescribe, amend, and rescind any rules and
    regulations necessary or appropriate for the administration of
    the Plan, (iii) establish performance goals for an Award
    and certify the extent of their achievement, and (iv) make
    such other determinations or certifications and take such other
    action as it deems necessary or advisable in the administration
    of the Plan. Any interpretation, determination, or other action
    made or taken by the Committee shall be final, binding, and
    conclusive on all interested parties.



 



    The Committee may delegate to officers of the Company, pursuant
    to a written delegation, the authority to perform specified
    administrative functions under the Plan. Any actions taken by
    any officers of the Company pursuant to such written delegation
    of authority shall be deemed to have been taken by the
    Committee. Notwithstanding the foregoing, to the extent such
    delegation shall be in violation of any law or applicable
    regulation including satisfaction of the requirements of
    Section 162(m) of the Code
    and/or
    Rule 16b-3
    promulgated under the 1934 Act, any such administrative
    function, including those relating to a Reporting Participant or
    a covered employee (as defined in Section 162(m) of the
    Code) shall be performed solely by the Committee.



 



    With respect to restrictions in the Plan that are based on the
    requirements of
    Rule 16b-3
    promulgated under the 1934 Act, Section 422 of the
    Code, Section 162(m) of the Code, the rules of any exchange
    or inter-dealer quotation system upon which the Company’s
    securities are listed or quoted, or any other applicable law,
    rule or restriction (collectively, “applicable
    law”), to the extent that any such restrictions are
    no longer required by applicable law, the Committee shall have
    the sole discretion and authority to grant Awards that are not
    subject to such mandated restrictions
    and/or to
    waive any such mandated restrictions with respect to outstanding
    Awards.



 




    ARTICLE 4

    



 




    ELIGIBILITY
    



 



    Any Employee (including an Employee who is also a director or an
    officer) whose judgment, initiative, and efforts contributed or
    may be expected to contribute to the successful performance of
    the Company is eligible to participate in the Plan; provided
    that only Employees of a corporation shall be eligible to
    receive Incentive Stock Options. The Committee, upon its own
    action, may grant, but shall not be required to grant, an Award
    to any Employee of the Company or any Subsidiary. Awards may be
    granted by the Committee at any time and from time to time to
    new Participants, or to then Participants, or to a greater or
    lesser number of Participants, and may include or exclude
    previous Participants, as the Committee shall determine. Except
    as required by this Plan, Awards granted at different times need
    not contain similar provisions. The Committee’s
    determinations under the Plan (including without limitation
    determinations of which Employees, if any, are to receive
    Awards, the form, amount and timing of such Awards, the terms
    and provisions of such Awards and the agreements evidencing
    same) need not be uniform and may be made by it selectively
    among Participants who receive, or are eligible to receive,
    Awards under the Plan.



 




    ARTICLE 5

    



 




    SHARES SUBJECT
    TO PLAN
    



 



    5.1  Number of Shares Available for
    Awards.  Subject to adjustment as provided in
    Articles 11 and 12, the maximum number of shares of
    Common Stock that may be delivered pursuant to Awards granted
    under the Plan is




    

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    5,000,000 shares, of which 2,000,000 shares may be
    delivered pursuant to Incentive Stock Options. Subject to
    adjustment pursuant to Articles 11 and 12, no
    Participant may receive in any fiscal year of the Company Awards
    that exceed an aggregate of more than 200,000 shares of
    Common Stock. Shares to be issued may be made available from
    authorized but unissued Common Stock, Common Stock held by the
    Company in its treasury, or Common Stock purchased by the
    Company on the open market or otherwise. During the term of this
    Plan, the Company will at all times reserve and keep available
    the number of shares of Common Stock that shall be sufficient to
    satisfy the requirements of this Plan.



 



    5.2  Reuse of Shares.  To the extent
    that any Award under this Plan shall be forfeited, shall expire
    or be canceled, in whole or in part on or after the Effective
    Date, then the number of shares of Common Stock covered by the
    Award or stock option so forfeited, expired or canceled may
    again be awarded pursuant to the provisions of this Plan. In the
    event that previously acquired shares of Common Stock are
    delivered to the Company in full or partial payment of the
    exercise price for the exercise of a Stock Option granted under
    this Plan, the number of shares of Common Stock available for
    future Awards under this Plan shall be reduced by the total
    number of shares of Common Stock issued upon the exercise of the
    Stock Option. Awards that may be satisfied either by the
    issuance of shares of Common Stock or by cash or other
    consideration shall be counted against the maximum number of
    shares of Common Stock that may be issued under this Plan only
    during the period that the Award is outstanding or to the extent
    the Award is ultimately satisfied by the issuance of shares of
    Common Stock. Awards will not reduce the number of shares of
    Common Stock that may be issued pursuant to this Plan if the
    settlement of the Award will not require the issuance of shares
    of Common Stock, as, for example, a SAR that can be settled only
    by the payment of cash. Notwithstanding any provisions of the
    Plan to the contrary, only shares forfeited back to the Company
    and shares canceled on account of termination, expiration or
    lapse of an Award, shall again be available for grant of
    Incentive Stock Options under the Plan, but shall not increase
    the maximum number of shares described in
    Section 5.1 above as the maximum number of shares of
    Common Stock that may be delivered pursuant to Incentive Stock
    Options.



 




    ARTICLE 6

    



 




    GRANT OF
    AWARDS
    



 



    6.1  In General.  The grant of an
    Award shall be authorized by the Committee and shall be
    evidenced by an Award Agreement setting forth the Incentive or
    Incentives being granted, the total number of shares of Common
    Stock subject to the Incentive(s), the Option Price (if
    applicable), the Award Period, the Date of Grant, and such other
    terms, provisions, limitations, and performance objectives, as
    are approved by the Committee, but (i) not inconsistent
    with the Plan and (ii) to the extent an Award issued under
    the Plan is subject to Section 409A of the Code, in
    compliance with the applicable requirements of Section 409A
    of the Code and the regulations or other guidance issued
    thereunder. The Company shall execute an Award Agreement with a
    Participant after the Committee approves the issuance of an
    Award. Any Award granted pursuant to this Plan must be granted
    within ten (10) years of the date of adoption of this Plan.



 



    6.2  Option Price.  The Option Price
    for any share of Common Stock which may be purchased under a
    Nonqualified Stock Option for any share of Common Stock may be
    equal to or greater than the Fair Market Value of the share on
    the Date of Grant. The Option Price for any share of Common
    Stock which may be purchased under an Incentive Stock Option
    must be at least equal to the Fair Market Value of the share on
    the Date of Grant; if an Incentive Stock Option is granted to an
    Employee who owns or is deemed to own (by reason of the
    attribution rules of Section 424(d) of the Code) more than
    ten percent (10%) of the combined voting power of all classes of
    stock of the Company (or any parent or Subsidiary), the Option
    Price shall be at least 110% of the Fair Market Value of the
    Common Stock on the Date of Grant. In no event shall Stock
    Options be granted to any Participant in substitution for, or
    upon cancellation of, previously granted Stock Options to
    purchase Common Stock, or shall similar action be taken to
    effect the “repricing” of previously granted Stock
    Options.



 



    6.3  Maximum ISO Grants.  The
    Committee may not grant Incentive Stock Options under the Plan
    to any Employee which would permit the aggregate Fair Market
    Value (determined on the Date of Grant) of the Common Stock with
    respect to which Incentive Stock Options (under this and any
    other plan of the Company and its Subsidiaries) are exercisable
    for the first time by such Employee during any calendar year to
    exceed $100,000. To




    

    6








 






    the extent any Stock Option granted under this Plan which is
    designated as an Incentive Stock Option exceeds this limit or
    otherwise fails to qualify as an Incentive Stock Option, such
    Stock Option (or any such portion thereof) shall be a
    Nonqualified Stock Option. In such case, the Committee shall
    designate which stock will be treated as Incentive Stock Option
    stock by causing a book entry registration in the Company’s
    direct registration service (“DRS”) or
    the issuance of a separate stock certificate and identifying
    such stock as Incentive Stock Option stock on the Company’s
    stock transfer records.



 



    6.4  Restricted Stock.  If Restricted
    Stock is granted to or received by a Participant under an Award
    (including a Stock Option), the Committee shall set forth in the
    related Award Agreement: (i) the number of shares of Common
    Stock awarded, (ii) the price, if any, to be paid by the
    Participant for such Restricted Stock and the method of payment
    of the price, (iii) the time or times within which such
    Award may be subject to forfeiture, (iv) specified
    Performance Goals of the Company, a Subsidiary, any division
    thereof or any group of Employees of the Company, or other
    criteria, which the Committee determines must be met in order to
    remove any restrictions (including vesting) on such Award, and
    (v) all other terms, limitations, restrictions, and
    conditions of the Restricted Stock, which shall be consistent
    with this Plan and to the extent Restricted Stock granted under
    the Plan is subject to Section 409A of the Code, in
    compliance with the applicable requirements of Section 409A
    of the Code and the regulations or other guidance issued
    thereunder. The provisions of Restricted Stock need not be the
    same with respect to each Participant.



 



    (a) Book Entry or Certificate Issuance of
    Awards.  Shares of Restricted Stock shall be
    represented by, at the option of the Company, either book entry
    registration in the Company’s DRS or by a stock certificate
    or certificates. If shares of Restricted Stock are represented
    by a certificate or certificates, such certificate(s) shall be
    registered in the name of the Participant and shall bear an
    appropriate legend referring to the terms, condition, and
    restrictions applicable to such Restricted Stock, substantially
    as provided in Section 15.9 of the Plan. The Committee may
    require that the stock certificates evidencing shares of
    Restricted Stock be held in custody by the Company until the
    restrictions thereon shall have lapsed, and that the Participant
    deliver to the Committee a stock power or stock powers, endorsed
    in blank, relating to the shares of Restricted Stock. All shares
    of Restricted Stock issued in book entry DRS form shall be
    subject to the same restrictions described in the legend
    provided in Section 15.9 of the Plan.



 



    (b) Restrictions and Conditions.  Shares
    of Restricted Stock shall be subject to the following
    restrictions and conditions:



 



    (i) Subject to the other provisions of this Plan and the
    terms of the particular Award Agreements, during such period as
    may be determined by the Committee commencing on the Date of
    Grant or the date of exercise of an Award (the
    “Restriction Period”), the Participant
    shall not be permitted to sell, transfer, pledge or assign
    shares of Restricted Stock. Except for these limitations, the
    Committee may in its sole discretion, remove any or all of the
    restrictions on such Restricted Stock whenever it may determine
    that, by reason of changes in applicable laws or other changes
    in circumstances arising after the date of the Award, such
    action is appropriate.



 



    (ii) Except as provided in
    sub-paragraph (i) above,
    the Participant shall have, with respect to his or her
    Restricted Stock, all of the rights of a stockholder of the
    Company, including the right to vote the shares, and the right
    to receive as compensation an amount equal to any dividends
    thereon. Shares of Restricted Stock that are free of restriction
    under this Plan shall be delivered to the Participant promptly
    after, and only after, the Restriction Period shall expire
    without forfeiture in respect of such shares of Common Stock by
    either delivery of certificated shares or book entry DRS
    registration. Shares of Common Stock forfeited under the
    provisions of the Plan and the applicable Award Agreement shall
    be promptly returned to the Company by the forfeiting
    Participant. Each Award Agreement shall require that
    (x) each Participant, by his or her acceptance of
    Restricted Stock, shall irrevocably grant to the Company a power
    of attorney to transfer any shares so forfeited to the Company
    and agrees to execute any documents requested by the Company in
    connection with such forfeiture and transfer, and (y) such
    provisions regarding returns and transfers of forfeited shares
    of Common Stock shall be specifically performable by the Company
    in a court of equity or law.




    

    7








 






    (iii) The Restriction Period of Restricted Stock shall
    commence on the Date of Grant or the date of exercise of an
    Award, as specified in the Award Agreement, and, subject to
    Article 12 of the Plan, unless otherwise established
    by the Committee in the Award Agreement setting forth the terms
    of the Restricted Stock, shall expire upon satisfaction of the
    conditions set forth in the Award Agreement; such conditions may
    provide for vesting based on such Performance Goals, as may be
    determined by the Committee in its sole discretion.



 



    (iv) Except as otherwise provided in the particular Award
    Agreement, upon Termination of Service for any reason during the
    Restriction Period, the nonvested shares of Restricted Stock
    shall be forfeited by the Participant. In the event a
    Participant has paid any consideration to the Company for such
    forfeited Restricted Stock, the Committee shall specify in the
    Award Agreement that either (i) the Company shall be
    obligated to, or (ii) the Company may, in its sole
    discretion, elect to, pay to the Participant, as soon as
    practicable after the event causing forfeiture, in cash, an
    amount equal to the lesser of the total consideration paid by
    the Participant for such forfeited shares or the Fair Market
    Value of such forfeited shares as of the date of Termination of
    Service, as the Committee, in its sole discretion shall select.
    Upon any forfeiture, all rights of a Participant with respect to
    the forfeited shares of the Restricted Stock shall cease and
    terminate, without any further obligation on the part of the
    Company.



 



    6.5  SARs.  The Committee may grant
    SARs to any Participant, either as a separate Award or in
    connection with a Stock Option. SARs shall be subject to such
    terms and conditions as the Committee shall impose, provided
    that such terms and conditions are (i) not inconsistent
    with the Plan and (ii) to the extent a SAR issued under the
    Plan is subject to Section 409A of the Code, in compliance
    with the applicable requirements of Section 409A of the
    Code and the regulations or other guidance issued thereunder.
    The grant of the SAR may provide that the holder may be paid for
    the value of the SAR either in cash or in shares of Common
    Stock, or a combination thereof. In the event of the exercise of
    a SAR payable in shares of Common Stock, the holder of the SAR
    shall receive that number of whole shares of Common Stock having
    an aggregate Fair Market Value on the date of exercise equal to
    the value obtained by multiplying (i) the difference
    between the Fair Market Value of a share of Common Stock on the
    date of exercise over the SAR Price as set forth in such SAR (or
    other value specified in the agreement granting the SAR), by
    (ii) the number of shares of Common Stock as to which the
    SAR is exercised, with a cash settlement to be made for any
    fractional shares of Common Stock. The SAR Price for any share
    of Common Stock subject to a SAR may be equal to or greater than
    the Fair Market Value of the share on the Date of Grant. The
    Committee, in its sole discretion, may place a ceiling on the
    amount payable upon exercise of a SAR, but any such limitation
    shall be specified at the time that the SAR is granted.



 



    6.6  Restricted Stock
    Units.  Restricted Stock Units may be awarded or
    sold to any Participant under such terms and conditions as shall
    be established by the Committee, provided, however, that such
    terms and conditions are (i) not inconsistent with the Plan
    and (ii) to the extent a Restricted Stock Unit issued under
    the Plan is subject to Section 409A of the Code, in
    compliance with the applicable requirements of Section 409A
    of the Code and the regulations or other guidance issued
    thereunder. Restricted Stock Units shall be subject to such
    restrictions as the Committee determines, including, without
    limitation, (a) a prohibition against sale, assignment,
    transfer, pledge, hypothecation or other encumbrance for a
    specified period; or (b) a requirement that the holder
    forfeit (or in the case of shares of Common Stock or units sold
    to the Participant, resell to the Company at cost) such shares
    or units in the event of Termination of Service during the
    period of restriction.



 



    6.7  Performance Awards.



 



    (a) The Committee may grant Performance Awards to any
    Participant upon such terms and conditions as shall be specified
    at the time of the grant and may include provisions establishing
    the performance period, the Performance Goals to be achieved
    during a performance period, and the maximum or minimum
    settlement values, provided that such terms and conditions are
    (i) not inconsistent with the Plan and (ii) to the
    extent a Performance Award issued under the Plan is subject to
    Section 409A of the Code, in compliance with the applicable
    requirements of Section 409A of the Code and the
    regulations or other guidance issued thereunder. Each
    Performance Award shall have its own terms and conditions. At
    the time of the grant of a Performance Award intended to satisfy
    the




    

    8








 






    requirements of Section 162(m) of the Code (other than a
    Stock Option) and to the extent permitted under
    Section 162(m) of the Code and the regulations issued
    thereunder, the Committee:



 



    (i) shall provide for the manner in which the Performance
    Goals shall be reduced to take into account the negative effect
    on the attained levels of the Performance Goals which result
    from specified corporate transactions, extraordinary events,
    accounting changes and other similar occurrences, so long as
    those transactions, events, changes and occurrences were not
    certain at the time the Performance Goal was initially
    established and the amount of the Performance Award for any
    Participant is not increased, unless the reduction in the
    Performance Goals would reduce or eliminate the amount of the
    Performance Award, and the Committee determines not to make such
    reduction; and



 



    (ii) may provide for the manner in which the Performance
    Goals will be measured in light of specified corporate
    transactions, extraordinary events, accounting changes and other
    similar occurrences, to the extent those transactions, events,
    changes and occurrences have a positive effect on the attained
    levels of the Performance Goals, so long as the Committee’s
    actions do not increase the amount of the Performance Award for
    any Participant.



 



    The determination of the amount of any reduction in the
    Performance Goals shall be made by the Committee in consultation
    with the Company’s independent auditor or compensation
    consultant. With respect to a Performance Award that is not
    intended to satisfy the requirements of Section 162(m) of
    the Code, if the Committee determines, in its sole discretion,
    that the established performance measures or objectives are no
    longer suitable because of a change in the Company’s
    business, operations, corporate structure, or for other reasons
    that the Committee deemed satisfactory, the Committee may modify
    the performance measures or objectives
    and/or the
    performance period.



 



    (b) Performance Awards may be valued by reference to the
    Fair Market Value of a share of Common Stock or according to any
    formula or method deemed appropriate by the Committee, in its
    sole discretion, including, but not limited to, achievement of
    Performance Goals or other specific financial, production, sales
    or cost performance objectives that the Committee believes to be
    relevant to the Company’s business
    and/or
    remaining in the employ of the Company for a specified period of
    time. Performance Awards may be paid in cash, shares of Common
    Stock, or other consideration, or any combination thereof. If
    payable in shares of Common Stock, the consideration for the
    issuance of such shares may be the achievement of the
    performance objective established at the time of the grant of
    the Performance Award. Performance Awards may be payable in a
    single payment or in installments and may be payable at a
    specified date or dates or upon attaining the performance
    objective. The extent to which any applicable performance
    objective has been achieved shall be conclusively determined by
    the Committee.



 



    6.8  Other Awards.  The Committee may
    grant to any Participant other forms of Awards, based upon,
    payable in, or otherwise related to, in whole or in part, shares
    of Common Stock, if the Committee determines that such other
    form of Award is consistent with the purpose and restrictions of
    this Plan. The terms and conditions of such other form of Award
    shall be specified by the grant. Such Other Awards may be
    granted for no cash consideration, for such minimum
    consideration as may be required by applicable law, or for such
    other consideration as may be specified by the grant.



 



    6.9  Performance Goals.  Awards of
    Restricted Stock, Restricted Stock Units, Performance Award and
    Other Awards (whether relating to cash or shares of Common
    Stock) under the Plan may be made subject to the attainment of
    Performance Goals relating to one or more business criteria
    which, where applicable, shall be within the meaning of
    Section 162(m) of the Code and consist of one or more or
    any combination of the following criteria: including, but not
    limited to, cash flow; cost; revenues; sales; ratio of debt to
    debt plus equity; net borrowing, credit quality or debt ratings;
    profit before tax; economic profit; earnings before interest and
    taxes; earnings before interest, taxes, depreciation and
    amortization; gross margin; earnings per share (whether on a
    pre-tax, after-tax, operational or other basis); operating
    profit earnings before or after tax; capital expenditures;
    expenses or expense levels; economic value added; ratio of
    operating earnings to capital spending or any other operating
    ratios; free cash flow; net earnings on either a LIFO or FIFO
    basis; net sales; net asset or book value per share; the
    accomplishment of mergers, acquisitions, dispositions, public
    offerings or similar extraordinary business transactions; sales
    growth; price of the Company’s Common Stock; return on
    assets, net assets, invested capital, equity, or
    stockholders’ equity; market share; inventory levels,
    inventory turn or shrinkage; total return to stockholders;
    productivity increases, units per man hour; or reduction in lost
    time accidents or other safety records (“Performance
    Criteria”). Any




    

    9








 






    Performance Criteria may be used to measure the performance of
    the Company as a whole or any business unit of the Company and
    may be measured relative to a peer group or index. Any
    Performance Criteria may include or exclude
    (i) extraordinary, unusual
    and/or
    non-recurring items of gain or loss, (ii) gains or losses
    on the disposition of a business, (iii) changes in tax or
    accounting regulations or laws, or (iv) the effect of a
    merger or acquisition, as identified in the Company’s
    quarterly and annual earnings releases. In all other respects,
    Performance Criteria shall be calculated in accordance with the
    Company’s financial statements, under generally accepted
    accounting principles, or under a methodology established by the
    Committee prior to the issuance of an Award which is
    consistently applied and identified in the audited financial
    statements, including footnotes, or the Management Discussion
    and Analysis section of the Company’s annual report.
    However, to the extent Section 162(m) of the Code is
    applicable, the Committee may not in any event increase the
    amount of compensation payable to an individual upon the
    attainment of a Performance Goal.



 



    6.10  Tandem Awards.  The Committee
    may grant two or more Incentives in one Award in the form of a
    “tandem Award,” so that the right of the Participant
    to exercise one Incentive shall be canceled if, and to the
    extent, the other Incentive is exercised. For example, if a
    Stock Option and a SAR are issued in a tandem Award, and the
    Participant exercises the SAR with respect to 100 shares of
    Common Stock, the right of the Participant to exercise the
    related Stock Option shall be canceled to the extent of
    100 shares of Common Stock.



 




    ARTICLE 7

    



 




    AWARD
    PERIOD; VESTING
    



 



    7.1  Award Period.  Subject to the
    other provisions of this Plan, the Committee may, in its
    discretion, provide that an Incentive may not be exercised in
    whole or in part for any period or periods of time or beyond any
    date specified in the Award Agreement. Except as provided in the
    Award Agreement, an Incentive may be exercised in whole or in
    part at any time during its term. The Award Period for an
    Incentive shall be reduced or terminated upon Termination of
    Service. No Incentive granted under the Plan may be exercised at
    any time after the end of its Award Period. No portion of any
    Incentive may be exercised after the expiration of ten
    (10) years from its Date of Grant. However, if an Employee
    owns or is deemed to own (by reason of the attribution rules of
    Section 424(d) of the Code) more than 10% of the combined
    voting power of all classes of stock of the Company (or any
    parent or Subsidiary) and an Incentive Stock Option is granted
    to such Employee, the term of such Incentive Stock Option (to
    the extent required by the Code at the time of grant) shall be
    no more than five (5) years from the Date of Grant.



 



    7.2  Vesting.  The Committee, in its
    sole discretion, may determine that an Incentive will be
    immediately vested in whole or in part, or that all or any
    portion may not be vested until a date, or dates, subsequent to
    its Date of Grant, or until the occurrence of one or more
    specified events, subject in any case to the terms of the Plan.
    If the Committee imposes conditions upon vesting, then,
    subsequent to the Date of Grant, the Committee may, in its sole
    discretion, accelerate the date on which all or any portion of
    the Incentive may be vested.



 




    ARTICLE 8

    



 




    EXERCISE OR
    CONVERSION OF INCENTIVE
    



 



    8.1  In General.  A vested Incentive
    may be exercised or converted, during its Award Period, subject
    to limitations and restrictions set forth in the Award Agreement



 



    8.2  Securities Law and Exchange
    Restrictions.  In no event may an Incentive be
    exercised or shares of Common Stock be issued pursuant to an
    Award if a necessary listing or quotation of the shares of
    Common Stock on a stock exchange or inter-dealer quotation
    system or any registration under state or federal securities
    laws required under the circumstances has not been accomplished.



 



    8.3  Exercise of Stock Option.



 



    (a) In General.  If the Committee imposes
    conditions upon exercise, then subsequent to the Date of Grant,
    the Committee may, in its sole discretion, accelerate the date
    on which all or any portion of the Stock Option may be




    

    10








 






    exercised. No Stock Option may be exercised for a fractional
    share of Common Stock. The granting of a Stock Option shall
    impose no obligation upon the Participant to exercise that Stock
    Option.



 



    (b) Notice and Payment.  Subject to such
    administrative regulations as the Committee may from time to
    time adopt, a Stock Option may be exercised by the delivery of
    written notice to the Committee setting forth the number of
    shares of Common Stock with respect to which the Stock Option is
    to be exercised and the date of exercise thereof (the
    “Exercise Date”) which shall be at least
    three (3) days after giving such notice unless an earlier
    time shall have been mutually agreed upon. On the Exercise Date,
    the Participant shall deliver to the Company consideration with
    a value equal to the total Option Price of the shares to be
    purchased, payable as provided in the Award Agreement, which may
    provide for payment in any one or more of the following ways:
    (a) cash or check, bank draft, or money order payable to
    the order of the Company, (b) Common Stock (including
    Restricted Stock) owned by the Participant on the Exercise Date,
    valued at its Fair Market Value on the Exercise Date, and which
    the Participant has not acquired from the Company within six
    (6) months prior to the Exercise Date, (c) by delivery
    (including by FAX) to the Company or its designated agent of an
    executed irrevocable option exercise form together with
    irrevocable instructions from the Participant to a broker or
    dealer, reasonably acceptable to the Company, to sell certain of
    the shares of Common Stock purchased upon exercise of the Stock
    Option or to pledge such shares as collateral for a loan and
    promptly deliver to the Company the amount of sale or loan
    proceeds necessary to pay such purchase price,
    and/or
    (d) in any other form of valid consideration that is
    acceptable to the Committee in its sole discretion. In the event
    that shares of Restricted Stock are tendered as consideration
    for the exercise of a Stock Option, a number of shares of Common
    Stock issued upon the exercise of the Stock Option equal to the
    number of shares of Restricted Stock used as consideration
    therefor shall be subject to the same restrictions and
    provisions as the Restricted Stock so tendered.



 



    (c) Issuance of Certificate.  Except as
    otherwise provided in Section 6.4 hereof (with
    respect to shares of Restricted Stock) or in the applicable
    Award Agreement, upon payment of all amounts due from the
    Participant, the Company shall deliver shares of Common Stock
    then being purchased represented by, at the option of the
    Company, book entry DRS registration or by a certificate of
    certificates, to the Participant (or the person exercising the
    Participant’s Stock Option in the event of his death) at
    the Company’s principal business office, promptly after the
    Exercise Date; provided that if the Participant has exercised an
    Incentive Stock Option, the Company may at its option retain
    physical possession of any certificate evidencing the shares
    acquired upon exercise until the expiration of the holding
    periods described in Section 422(a)(1) of the Code. The
    obligation of the Company to deliver shares of Common Stock
    shall, however, be subject to the condition that, if at any time
    the Committee shall determine in its discretion that the
    listing, registration, or qualification of the Stock Option or
    the Common Stock upon any securities exchange or inter-dealer
    quotation system or under any state or federal law, or the
    consent or approval of any governmental regulatory body, is
    necessary as a condition of, or in connection with, the Stock
    Option or the issuance or purchase of shares of Common Stock
    thereunder, the Stock Option may not be exercised in whole or in
    part unless such listing, registration, qualification, consent,
    or approval shall have been effected or obtained free of any
    conditions not reasonably acceptable to the Committee.



 



    (e) Failure to Pay.  Except as may
    otherwise be provided in an Award Agreement, if the Participant
    fails to pay for any of the Common Stock specified in such
    notice or fails to accept delivery thereof, that portion of the
    Participant’s Stock Option and right to purchase such
    Common Stock may be forfeited by the Company.



 



    8.4  SARs.  Subject to the conditions
    of this Section 8.4 and such administrative
    regulations as the Committee may from time to time adopt, a SAR
    may be exercised by the delivery (including by FAX) of written
    notice to the Committee setting forth the number of shares of
    Common Stock with respect to which the SAR is to be exercised
    and the date of exercise thereof (the “Exercise
    Date”) which shall be at least three (3) days
    after giving such notice unless an earlier time shall have been
    mutually agreed upon. Subject to the terms of the Award
    Agreement and only if permissible under Section 409A of the
    Code and the regulations or other guidance issued thereunder
    (or, if not so permissible, at such time as permitted by
    Section 409A of the Code and the regulations or other
    guidance issued thereunder), the Participant shall receive from
    the Company in exchange therefor in the discretion of the
    Committee, and subject to the terms of the Award Agreement:



 



    (i) cash in an amount equal to the excess (if any) of the
    Fair Market Value (as of the date of the exercise, or if
    provided in the Award Agreement, conversion, of the SAR) per
    share of Common Stock over the SAR




    

    11








 






    Price per share specified in such SAR, multiplied by the total
    number of shares of Common Stock of the SAR being surrendered;



 



    (ii) that number of shares of Common Stock having an
    aggregate Fair Market Value (as of the date of the exercise, or
    if provided in the Award Agreement, conversion, of the SAR)
    equal to the amount of cash otherwise payable to the
    Participant, with a cash settlement to be made for any
    fractional share interests; or



 



    (iii) the Company may settle such obligation in part with
    shares of Common Stock and in part with cash.



 



    The distribution of any cash or Common Stock pursuant to the
    foregoing sentence shall be made at such time as set forth in
    the Award Agreement.



 



    8.5  Disqualifying Disposition of Incentive Stock
    Option.  If shares of Common Stock acquired upon
    exercise of an Incentive Stock Option are disposed of by a
    Participant prior to the expiration of either two (2) years
    from the Date of Grant of such Stock Option or one (1) year
    from the transfer of shares of Common Stock to the Participant
    pursuant to the exercise of such Stock Option, or in any other
    disqualifying disposition within the meaning of Section 422
    of the Code, such Participant shall notify the Company in
    writing of the date and terms of such disposition. A
    disqualifying disposition by a Participant shall not affect the
    status of any other Stock Option granted under the Plan as an
    Incentive Stock Option within the meaning of Section 422 of
    the Code.



 




    ARTICLE 9

    



 




    AMENDMENT OR
    DISCONTINUANCE
    



 



    Subject to the limitations set forth in this
    Article 9, the Board may at any time and from time
    to time, without the consent of the Participants, alter, amend,
    revise, suspend, or discontinue the Plan in whole or in part;
    provided, however, that no amendment for which stockholder
    approval is required either (i) by any securities exchange
    or inter-dealer quotation system on which the Common Stock is
    listed or traded or (ii) in order for the Plan and
    Incentives awarded under the Plan to continue to comply with
    Sections 162(m), 421, and 422 of the Code, including any
    successors to such Sections; shall be effective unless such
    amendment shall be approved by the requisite vote of the
    stockholders of the Company entitled to vote thereon. Any such
    amendment shall, to the extent deemed necessary or advisable by
    the Committee, be applicable to any outstanding Incentives
    theretofore granted under the Plan, notwithstanding any contrary
    provisions contained in any Award Agreement. In the event of any
    such amendment to the Plan, the holder of any Incentive
    outstanding under the Plan shall, upon request of the Committee
    and as a condition to the exercisability thereof, execute a
    conforming amendment in the form prescribed by the Committee to
    any Award Agreement relating thereto. Notwithstanding anything
    contained in this Plan to the contrary, unless required by law,
    no action contemplated or permitted by this
    Article 9 shall adversely affect any rights of
    Participants or obligations of the Company to Participants with
    respect to any Incentive theretofore granted under the Plan
    without the consent of the affected Participant.



 




    ARTICLE 10

    



 




    TERM
    



 



    The Plan shall be effective from the date that this Plan is
    approved by the Board. Unless sooner terminated by action of the
    Board, the Plan will terminate on December 1, 2016, but
    Incentives granted before that date will continue to be
    effective in accordance with their terms and conditions.



 




    ARTICLE 11

    



 




    CAPITAL
    ADJUSTMENTS
    



 



    In the event that any dividend or other distribution (whether in
    the form of cash, Common Stock, other securities, or other
    property), recapitalization, stock split, reverse stock split,
    rights offering, reorganization, merger, consolidation,
    split-up,
    spin-off, split-off, combination, subdivision, repurchase, or
    exchange of Common Stock or other securities of the Company,
    issuance of warrants or other rights to purchase Common Stock or
    other




    

    12








 






    securities of the Company, or other similar corporate
    transaction or event affects the fair value of an Award, then
    the Committee shall adjust any or all of the following so that
    the fair value of the Award immediately after the transaction or
    event is equal to the fair value of the Award immediately prior
    to the transaction or event: (i) the number of shares and
    type of Common Stock (or the securities or property) which
    thereafter may be made the subject of Awards, (ii) the
    number of shares and type of Common Stock (or other securities
    or property) subject to outstanding Awards, (iii) the
    number of shares and type of Common Stock (or other securities
    or property) specified as the annual per-participant limitation
    under Section 5.1 of the Plan, (iv) the Option
    Price of each outstanding Award, (v) the amount, if any,
    the Company pays for forfeited shares of Common Stock in
    accordance with Section 6.4, and (vi) the
    number of or SAR Price of shares of Common Stock then subject to
    outstanding SARs previously granted and unexercised under the
    Plan to the end that the same proportion of the Company’s
    issued and outstanding shares of Common Stock in each instance
    shall remain subject to exercise at the same aggregate SAR
    Price; provided however, that the number of shares of Common
    Stock (or other securities or property) subject to any Award
    shall always be a whole number. Notwithstanding the foregoing,
    no such adjustment shall be made or authorized to the extent
    that such adjustment would cause the Plan or any Stock Option to
    violate Section 422 of the Code. Such adjustments shall be
    made in accordance with the rules of any securities exchange,
    stock market, or stock quotation system to which the Company is
    subject.



 



    Upon the occurrence of any such adjustment, the Company shall
    provide notice to each affected Participant of its computation
    of such adjustment which shall be conclusive and shall be
    binding upon each such Participant.



 




    ARTICLE 12

    



 




    RECAPITALIZATION,
    MERGER AND CONSOLIDATION
    



 



    12.1  No Effect on Company’s
    Authority.  The existence of this Plan and
    Incentives granted hereunder shall not affect in any way the
    right or power of the Company or its stockholders to make or
    authorize any or all adjustments, recapitalizations,
    reorganizations, or other changes in the Company’s capital
    structure and its business, or any Change in Control, or any
    merger or consolidation of the Company, or any issuance of
    bonds, debentures, preferred or preference stocks ranking prior
    to or otherwise affecting the Common Stock or the rights thereof
    (or any rights, options, or warrants to purchase same), or the
    dissolution or liquidation of the Company, or any sale or
    transfer of all or any part of its assets or business, or any
    other corporate act or proceeding, whether of a similar
    character or otherwise.



 



    12.2  Conversion of Incentives Where Company
    Survives.  Subject to any required action by the
    stockholders and except as otherwise provided by
    Section 12.4 hereof or as may be required to comply
    with Section 409A of the Code and the regulations or other
    guidance issued thereunder, if the Company shall be the
    surviving or resulting corporation in any merger, consolidation
    or share exchange, any Incentive granted hereunder shall pertain
    to and apply to the securities or rights (including cash,
    property, or assets) to which a holder of the number of shares
    of Common Stock subject to the Incentive would have been
    entitled.



 



    12.3  Exchange or Cancellation of Incentives Where
    Company Does Not Survive.  Except as otherwise
    provided by Section 12.4 hereof or as may be
    required to comply with Section 409A of the Code and the
    regulations or other guidance issued thereunder, in the event of
    any merger, consolidation or share exchange pursuant to which
    the Company is not the surviving or resulting corporation, there
    shall be substituted for each share of Common Stock subject to
    the unexercised portions of outstanding Incentives, that number
    of shares of each class of stock or other securities or that
    amount of cash, property, or assets of the surviving, resulting
    or consolidated company which were distributed or distributable
    to the stockholders of the Company in respect to each share of
    Common Stock held by them, such outstanding Incentives to be
    thereafter exercisable for such stock, securities, cash, or
    property in accordance with their terms.



 



    12.4  Cancellation of
    Incentives.  Notwithstanding the provisions of
    Sections 12.2 and 12.3 hereof, and except as may be
    required to comply with Section 409A of the Code and the
    regulations or other guidance issued thereunder, all Incentives
    granted hereunder may be canceled by the Company, in its sole
    discretion, as of the




    

    13








 






    effective date of any Change in Control, merger, consolidation
    or share exchange, or of any proposed sale of all or
    substantially all of the assets of the Company, or of any
    dissolution or liquidation of the Company, by either:



 



    (a) giving notice to each holder thereof or his personal
    representative of its intention to cancel those Incentives for
    which the issuance of shares of Common Stock involved payment by
    the Participant for such shares and, permitting the purchase
    during the thirty (30) day period next preceding such
    effective date of any or all of the shares of Common Stock
    subject to such outstanding Incentives, including in the
    Board’s discretion some or all of the shares as to which
    such Incentives would not otherwise be vested and
    exercisable; or



 



    (b) in the case of Incentives that are either
    (i) settled only in shares of Common Stock, or (ii) at
    the election of the Participant, settled in shares of Common
    Stock, paying the holder thereof an amount equal to a reasonable
    estimate of the difference between the net amount per share
    payable in such transaction or as a result of such transaction,
    and the price per share of such Incentive to be paid by the
    Participant (hereinafter the “Spread”),
    multiplied by the number of shares subject to the Incentive. In
    cases where the shares constitute, or would after exercise,
    constitute Restricted Stock, the Company, in its discretion may
    include some or all of those shares in the calculation of the
    amount payable hereunder. In estimating the Spread, appropriate
    adjustments to give effect to the existence of the Incentives
    shall be made, such as deeming the Incentives to have been
    exercised, with the Company receiving the exercise price payable
    thereunder, and treating the shares receivable upon exercise of
    the Incentives as being outstanding in determining the net
    amount per share. In cases where the proposed transaction
    consists of the acquisition of assets of the Company, the net
    amount per share shall be calculated on the basis of the net
    amount receivable with respect to shares of Common Stock upon a
    distribution and liquidation by the Company after giving effect
    to expenses and charges, including but not limited to taxes,
    payable by the Company before such liquidation could be
    completed.



 



    (c) An Award that by its terms would be fully vested or
    exercisable upon a Change in Control will be considered vested
    or exercisable for purposes of Section 12.4(a)
    hereof.



 




    ARTICLE 13

    



 




    LIQUIDATION
    OR DISSOLUTION
    



 



    Subject to Section 12.4 hereof, in case the Company
    shall, at any time while any Incentive under this Plan shall be
    in force and remain unexpired, (i) sell all or
    substantially all of its property, or (ii) dissolve,
    liquidate, or wind up its affairs, then each Participant shall
    be entitled to receive, in lieu of each share of Common Stock of
    the Company which such Participant would have been entitled to
    receive under the Incentive, the same kind and amount of any
    securities or assets as may be issuable, distributable, or
    payable upon any such sale, dissolution, liquidation, or winding
    up with respect to each share of Common Stock of the Company. If
    the Company shall, at any time prior to the expiration of any
    Incentive, make any partial distribution of its assets, in the
    nature of a partial liquidation, whether payable in cash or in
    kind (but excluding the distribution of a cash dividend payable
    out of earned surplus and designated as such) and an adjustment
    is determined by the Committee to be appropriate to prevent the
    dilution of the benefits or potential benefits intended to be
    made available under the Plan, then the Committee shall, in such
    manner as it may deem equitable, make such adjustment in
    accordance with the provisions of Article 11 hereof.



 




    ARTICLE 14

    



 




    INCENTIVES
    IN SUBSTITUTION FOR

    





    INCENTIVES
    GRANTED BY OTHER ENTITIES
    



 



    Incentives may be granted under the Plan from time to time in
    substitution for similar instruments held by employees,
    consultants or directors of a corporation, partnership, or
    limited liability company who become or are about to become
    Employees of the Company or any Subsidiary as a result of a
    merger or consolidation of the employing corporation with the
    Company, the acquisition by the Company of equity of the
    employing entity, or any other similar transaction pursuant to
    which the Company becomes the successor employer. The terms and
    conditions of the substitute Incentives so granted may vary from
    the terms and conditions set forth in this Plan




    

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    to such extent as the Board at the time of grant may deem
    appropriate to conform, in whole or in part, to the provisions
    of the Incentives in substitution for which they are granted.



 




    ARTICLE 15

    



 




    MISCELLANEOUS
    PROVISIONS
    



 



    15.1  Investment Intent.  The Company
    may require that there be presented to and filed with it by any
    Participant under the Plan, such evidence as it may deem
    necessary to establish that the Incentives granted or the shares
    of Common Stock to be purchased or transferred are being
    acquired for investment and not with a view to their
    distribution.



 



    15.2  No Right to Continued
    Employment.  Neither the Plan nor any Incentive
    granted under the Plan shall confer upon any Participant any
    right with respect to continuance of employment by the Company
    or any Subsidiary.



 



    15.3  Indemnification of Board and
    Committee.  No member of the Board or the
    Committee, nor any officer or Employee of the Company acting on
    behalf of the Board or the Committee, shall be personally liable
    for any action, determination, or interpretation taken or made
    in good faith with respect to the Plan, and all members of the
    Board and the Committee, each officer of the Company, and each
    Employee of the Company acting on behalf of the Board or the
    Committee shall, to the extent permitted by law, be fully
    indemnified and protected by the Company in respect of any such
    action, determination, or interpretation.



 



    15.4  Effect of the Plan.  Neither
    the adoption of this Plan nor any action of the Board or the
    Committee shall be deemed to give any person any right to be
    granted an Award or any other rights except as may be evidenced
    by an Award Agreement, or any amendment thereto, duly authorized
    by the Committee and executed on behalf of the Company, and then
    only to the extent and upon the terms and conditions expressly
    set forth therein.



 



    15.5  Compliance With Other Laws and
    Regulations.  Notwithstanding anything contained
    herein to the contrary, the Company shall not be required to
    sell or issue shares of Common Stock under any Incentive if the
    issuance thereof would constitute a violation by the Participant
    or the Company of any provisions of any law or regulation of any
    governmental authority or any national securities exchange or
    inter-dealer quotation system or other forum in which shares of
    Common Stock are quoted or traded (including without limitation
    Section 16 of the 1934 Act and Section 162(m) of
    the Code); and, as a condition of any sale or issuance of shares
    of Common Stock under an Incentive, the Committee may require
    such agreements or undertakings, if any, as the Committee may
    deem necessary or advisable to assure compliance with any such
    law or regulation. The Plan, the grant and exercise of
    Incentives hereunder, and the obligation of the Company to sell
    and deliver shares of Common Stock, shall be subject to all
    applicable federal and state laws, rules and regulations and to
    such approvals by any government or regulatory agency as may be
    required.



 



    15.6  Tax Requirements.  The Company
    or, if applicable, any Subsidiary (for purposes of this
    Section 15.6, the term
    “Company” shall be deemed to include any
    applicable Subsidiary), shall have the right to deduct from all
    amounts paid in cash or other form in connection with the Plan,
    any Federal, state, local, or other taxes required by law to be
    withheld in connection with an Award granted under this Plan.
    The Company may, in its sole discretion, also require the
    Participant receiving shares of Common Stock issued under the
    Plan to pay the Company the amount of any taxes that the Company
    is required to withhold in connection with the
    Participant’s income arising with respect to the Award.
    Such payments shall be required to be made when requested by the
    Company and may be required to be made prior to the delivery of
    any certificate representing shares of Common Stock. Such
    payment may be made (i) by the delivery of cash to the
    Company in an amount that equals or exceeds (to avoid the
    issuance of fractional shares under (iii) below) the
    required tax withholding obligations of the Company;
    (ii) if the Company, in its sole discretion, so consents in
    writing, the actual delivery by the exercising Participant to
    the Company of shares of Common Stock that the Participant has
    not acquired from the Company within six (6) months prior
    to the date of exercise, which shares so delivered have an
    aggregate Fair Market Value that equals or exceeds (to avoid the
    issuance of fractional shares under (iii) below) the
    required tax withholding payment; (iii) if the Company, in
    its sole discretion, so consents in writing, the Company’s
    withholding of a number of shares to be delivered upon the
    exercise of the Stock Option, which shares so withheld have an
    aggregate fair market value that equals (but does not




    

    15








 






    exceed) the required tax withholding payment; or (iv) any
    combination of (i), (ii), or (iii). The Company may, in its sole
    discretion, withhold any such taxes from any other cash
    remuneration otherwise paid by the Company to the Participant.
    The Committee may in the Award Agreement impose any additional
    tax requirements or provisions that the Committee deems
    necessary or desirable.



 



    15.7  Assignability.  Incentive Stock
    Options may not be transferred, assigned, pledged, hypothecated
    or otherwise conveyed or encumbered other than by will or the
    laws of descent and distribution and may be exercised during the
    lifetime of the Participant only by the Participant or the
    Participant’s legally authorized representative, and each
    Award Agreement in respect of an Incentive Stock Option shall so
    provide. The designation by a Participant of a beneficiary will
    not constitute a transfer of the Stock Option. The Committee may
    waive or modify any limitation contained in the preceding
    sentences of this Section 15.7 that is not required
    for compliance with Section 422 of the Code.



 



    Except as otherwise provided herein, Nonqualified Stock Options
    and SARs may not be transferred, assigned, pledged, hypothecated
    or otherwise conveyed or encumbered other than by will or the
    laws of descent and distribution. The Committee may, in its
    discretion, authorize all or a portion of a Nonqualified Stock
    Option or SAR to be granted to a Participant on terms which
    permit transfer by such Participant to (i) the spouse (or
    former spouse), children or grandchildren of the Participant
    (“Immediate Family Members”),
    (ii) a trust or trusts for the exclusive benefit of such
    Immediate Family Members, (iii) a partnership in which the
    only partners are (1) such Immediate Family Members
    and/or
    (2) entities which are controlled by Immediate Family
    Members, (iv) an entity exempt from federal income tax
    pursuant to Section 501(c)(3) of the Code or any successor
    provision, or (v) a split interest trust or pooled income
    fund described in Section 2522(c)(2) of the Code or any
    successor provision, provided that (x) there shall
    be no consideration for any such transfer, (y) the Award
    Agreement pursuant to which such Nonqualified Stock Option or
    SAR is granted must be approved by the Committee and must
    expressly provide for transferability in a manner consistent
    with this Section, and (z) subsequent transfers of
    transferred Nonqualified Stock Options or SARs shall be
    prohibited except those by will or the laws of descent and
    distribution.



 



    Following any transfer, any such Nonqualified Stock Option and
    SAR shall continue to be subject to the same terms and
    conditions as were applicable immediately prior to transfer,
    provided that for purposes of
    Articles 8, 9, 11, 13 and 15 hereof the
    term “Participant” shall be deemed to include the
    transferee. The events of Termination of Service shall continue
    to be applied with respect to the original Participant,
    following which the Nonqualified Stock Options and SARs shall be
    exercisable or convertible by the transferee only to the extent
    and for the periods specified in the Award Agreement. The
    Committee and the Company shall have no obligation to inform any
    transferee of a Nonqualified Stock Option or SAR of any
    expiration, termination, lapse or acceleration of such Stock
    Option or SAR. The Company shall have no obligation to register
    with any federal or state securities commission or agency any
    Common Stock issuable or issued under a Nonqualified Stock
    Option or SAR that has been transferred by a Participant under
    this Section 15.7.  



 



    15.8  Use of Proceeds.  Proceeds from
    the sale of shares of Common Stock pursuant to Incentives
    granted under this Plan shall constitute general funds of the
    Company.



 



    15.9  Legend.  Each certificate
    representing shares of Restricted Stock issued to a Participant
    shall bear the following legend, or a similar legend deemed by
    the Company to constitute an appropriate notice of the
    provisions hereof (any such certificate not having such legend
    shall be surrendered upon demand by the Company and so endorsed):



 



    On the face of the certificate:



 



    “Transfer of this stock is restricted in accordance with
    conditions printed on the reverse of this certificate.”



 



    On the reverse:



 



    “The shares of stock evidenced by this certificate are
    subject to and transferable only in accordance with that certain
    Commercial Metals Company 2006 Long-Term Equity Incentive Plan,
    a copy of which is on file at the principal office of the
    Company in Dallas, Texas. No transfer or pledge of the shares
    evidenced hereby may be made except in accordance with and
    subject to the provisions of said Plan. By




    

    16








 






    acceptance of this certificate, any holder, transferee or
    pledgee hereof agrees to be bound by all of the provisions of
    said Plan.”



 



    The following legend shall be inserted on a certificate
    evidencing Common Stock issued under the Plan if the shares were
    not issued in a transaction registered under the applicable
    federal and state securities laws:



 



    “Shares of stock represented by this certificate have been
    acquired by the holder for investment and not for resale,
    transfer or distribution, have been issued pursuant to
    exemptions from the registration requirements of applicable
    state and federal securities laws, and may not be offered for
    sale, sold or transferred other than pursuant to effective
    registration under such laws, or in transactions otherwise in
    compliance with such laws, and upon evidence satisfactory to the
    Company of compliance with such laws, as to which the Company
    may rely upon an opinion of counsel satisfactory to the
    Company.”



 



    A copy of this Plan shall be kept on file in the principal
    office of the Company in Dallas, Texas.



 




    ***************
    




    

    17