Document:

EX-10.1

Exhibit 10.1

WORTHINGTON INDUSTRIES, INC.

ANNUAL INCENTIVE PLAN FOR EXECUTIVES

     The purpose of the Plan is to advance the interests of the Company by providing designated
officers and key employees with incentive compensation that is correlated with the achievement of
specified performance goals. The Plan is intended to provide compensation, which qualifies as
“qualified performance based compensation” within the meaning of Section 162(m) of the Code and
Treasury Regulation §1.162-27(e).

SECTION 1

DEFINITIONS

     For purposes of the Plan, unless the context requires otherwise, the following terms shall
have the respective meanings set forth in this Section:

     1.1 “Beneficiary” means the beneficiary or beneficiaries designated to receive any amounts
payable under the Plan pursuant to Section 7.9 upon a Participant’s death.

     1.2 “Board” means the Board of Directors of Worthington.

     1.3 “Business Unit” means any business, operating or administrative unit of the Company which
is identified and designated by the Committee, in its discretion, as a separate business unit for
purposes of this Plan.

     1.4 “Code” means the Internal Revenue Code of 1986, as amended, or any successor thereto.

     1.5 “Committee” means the Compensation and Stock Option Committee of the Board.

     1.6 “Common Shares” means the common shares, without par value, of Worthington, or any equity
security issued in substitution, in exchange or in place of the common shares of Worthington.

     1.7 “Company” means Worthington and its Subsidiaries, collectively.

     1.8 “Disability” means a permanent and total disability as defined in the primary retirement
plan of the Company in effect on the date the determination as to “Disability” is made — as of the
effective date of this Plan, the Worthington Industries, Inc. Deferred Profit Sharing Plan. A
Participant with a Disability shall be deemed “Disabled” for purposes of this Plan.

     1.9 “Employee” means an individual who is employed by and is on the payroll of the Company.

     1.10 “Employment” means that the Participant is an Employee of the Company. In this regard,
the transfer of a Participant from Employment by one entity which is part of the

 

 

Company to Employment by a different entity which is part of the Company shall not be deemed
to be a termination of the Participant’s Employment. A Participant who is an Employee shall be
deemed “Employed” for purposes of this Plan.

     1.11 “Incentive Compensation” means the compensation approved by the Committee to be awarded
to a Participant for any Performance Period under the Plan.

     1.12 “Participant” means an officer or other key Employee of the Company whom the Committee
designates as a participant under the Plan.

     1.13 “Payout Date” means the date the Committee establishes for the payment to a Participant
of any Incentive Compensation award under the Plan, as provided in Section 5 of this Plan.

     1.14 “Performance Award” means an award by the Committee under this Plan that is subject to
one or more of the Performance Criteria listed in Section 3.4 of this Plan.

     1.15 “Performance Criteria” means the criteria that are specified by the Committee pursuant to
Section 3.4 of this Plan, any one or more of which may be used in establishing the conditions of a
Performance Award.

     1.16 “Performance Period” means each fiscal year (or portion thereof) of the Company, or such
other period of twelve (12) months or less, as determined by the Committee.

     1.17 “Plan” means this Worthington Industries, Inc. Annual Incentive Plan for Executives, as
may be amended.

     1.18 “Retirement” means, unless the Committee specifies otherwise in the Performance Award,
termination of Employment (other than for Cause) with the Company which qualifies as a retirement
of the Participant under the Company’s normal policies.

     1.19 “Section 162(m) Employee” means a “covered employee” as defined under Section 162(m) of
the Code.

     1.20 “Subsidiary” means any corporation which constitutes a “subsidiary corporation” of the
Company, as defined in Section 424(f) of the Code, and any limited liability company, partnership,
joint venture, or other entity in which the Company controls, directly or indirectly, more than
fifty percent (50%) of its voting power or equity interests.

     1.21 “Worthington” means Worthington Industries, Inc., an Ohio corporation, or its successor
in interest.

 

 

SECTION 2

ADMINISTRATION

     The Plan shall be administered and interpreted by the Committee; provided that in no event
shall the Plan be interpreted in a manner that would cause any award intended to be qualified
performance based compensation under Section 162(m) of the Code to fail to so qualify with respect
to a Section 162(m) Employee. The Committee shall establish performance objectives relating to the
Performance Criteria for any Performance Period in accordance with Section 3 and certify whether
and to what extent such performance objectives have been achieved. Any determination made by the
Committee under the Plan shall be final and conclusive on the affected Participant. The Committee
may employ such legal counsel, consultants and agents (including counsel or agents who are
Employees of the Company) as it may deem desirable for the administration of the Plan and may rely
upon any opinion received from any such counsel or consultant or agent and any computation received
from such consultant or agent. All expenses incurred in the administration of the Plan, including,
without limitation, for the engagement of any counsel, consultant or agent, shall be paid by the
Company. To the extent permitted by applicable law, the Committee may delegate its authority under
this Plan; provided that the Committee shall in no event delegate its authority with respect to the
compensation of a Section 162(m) Employee.

SECTION 3

ELIGIBILITY, PERFORMANCE AWARDS AND PERFORMANCE CRITERIA

     3.1 Determination of Eligibility by the Committee. For each Performance Period, the Committee
shall select the Participants to whom Incentive Compensation may be awarded under the Plan for such
Performance Period consistent with the provisions of this Plan. Participants who participate in
the Plan may also participate in other incentive or other benefit plans maintained by the Company.

     3.2 Granting Performance Awards. The Committee may grant Performance Awards pursuant to the
Plan, in such amounts and on such terms (consistent with the provisions of the Plan), as the
Committee shall determine.

     3.3 Amount of Performance Award. The amount of the Performance Award payable under the Plan
if applicable performance objectives are met may be stated as a specific dollar amount, a
percentage of a Participant’s base salary, a percentage (the sum of which may not be greater than
one hundred percent (100%)) of an aggregate amount allocable to all or specified groups of
Participants or in any other objectively determinable manner as determined by the Committee. Also,
the amount of the Performance Award payable may be stated as a target amount due if applicable
performance objectives are met and in larger or smaller increments if the applicable performance
objectives are exceeded or partially met. The amount payable may not be increased solely due to
another Participant’s termination of Employment or eligibility during a Performance Period. As
determined by the Committee, the amount of any Performance Award payable under the Plan shall be
subject to performance objectives, consistent with Section 3.4 of this Plan. Notwithstanding
anything in the Plan to the contrary, during any fiscal year of the Company, no Participant may
receive more than $3,000,000 through this Plan with respect to any single Performance Award.

 

 

     3.4 Performance Objectives. For each Performance Period, the Committee will establish for
each Participant the performance objectives that will be applied to determine the amount of
Incentive Compensation payable to such Participant under the Plan with respect to a Performance
Award.

     The following Performance Criteria may be used by the Committee in setting performance
objectives with respect to the Plan:

          (a) Income or earnings (before or after interest, taxes, depreciation, amortization and/or
other items);

          (b) Earnings per Common Share;

          (c) Economic value added;

          (d) Sales or revenues;

          (e) Growth;

          (f) Operating income;

          (g) Return measures (including, but not limited to, return on assets, capital, invested
capital, equity or revenue);

          (h) Cash flow (including, but not limited to, operating cash flow, free cash flow, cash flow
return on equity or cash flow return on investment);

          (i) Gross, operating or other margins;

          (j) Productivity ratios or other productivity measures;

          (k) Common Share price (including, but not limited to, growth measures and total shareholder
return);

          (l) Expense reduction, expense targets or cost control;

          (m) Operating or other efficiencies;

          (n) Market share;

          (o) Developing new markets, new products and/or new lines of revenue; or

          (p) Identifying and completing acquisitions.

     Performance Criteria may be stated in absolute terms or relative to comparison entities,
indices or other measures to be achieved during a Performance Period. Performance Criteria may be
applied solely with reference to the Company (or any Business Unit) or relatively

 

 

between the Company (or any Business Unit) and one or more unrelated entities or business
units or indices.

     The Committee shall establish performance objectives based on one or more Performance Criteria
for each Performance Award to a Participant. The terms of the stated performance objectives for
each applicable Performance Award must preclude the Committee’s discretion to increase the amount
payable to any Section 162(m) Employee that would otherwise be due upon attainment of the
performance objectives. The performance objectives specified need not be applicable to all
Performance Awards, and may be particular or unique to an individual Participant’s function, duties
or Business Unit.

     The Committee may provide in any Performance Award that any evaluation of performance may
include or exclude the impact of any of the following events that occurs during a Performance
Period: (i) asset write-downs; (ii) litigation or claim judgments or settlements; (iii) changes in
tax laws, accounting principles, or other laws or provisions affecting reported results; (iv) any
reorganization and restructuring programs; (v) extraordinary or nonrecurring items; (vi)
acquisitions or divestitures; and (vii) foreign exchange gains and losses. To the extent such
inclusions or exclusions affect Performance Awards to Section 162(m) Employees, they shall be
prescribed in a form that meets the requirements of Section 162(m) of the Code for deductibility.

     3.5 Adjustments. The Committee will make appropriate adjustments to reflect the effect, if
any, on any Performance Criteria and performance objectives of any Common Share dividend or split,
recapitalization (including, without limitation, the payment of an extraordinary dividend), merger,
consolidation, combination, spin-off, distribution of assets to shareholders, exchange of shares or
similar corporate change. This adjustment to the Performance Criteria and performance objectives
will be made to the extent the Performance Criteria and performance objectives, as applicable, are
based on Common Shares as of the effective date of the event and for the Performance Period in
which the event occurs. Also, the Committee will make a similar adjustment to any portion of
Performance Criteria and any performance objectives that are not based on Common Shares but which
are affected by an event having an effect similar to those just described. To the extent allowable
under Section 162(m) of the Code, the Committee may also make adjustments to take into account
extraordinary or unusual events, the disposition or purchase of a business, or a change in
accounting practice. Notwithstanding the foregoing provisions of this Section 3.5, no adjustment
shall be made or is allowable under this Section 3.5 to the extent such adjustment would cause any
award to a Section 162(m) Employee intended to qualify as qualified performance based compensation
under Section 162(m) of the Code to fail to so qualify.

     3.6 Period for Determining Performance Objectives. Performance objectives with respect to any
Performance Award will be established by the Committee in writing before the outcome is
substantially certain but in no event later than the earlier of:

          (a) Ninety (90) days after the beginning of the applicable Performance Period; or

          (b) The expiration of twenty-five percent (25%) of the applicable Performance Period.

 

 

     3.7 Certification. As of the end of each Performance Period, the Committee will certify in
writing the extent to which each Participant has or has not met the applicable performance
objectives with respect to any Performance Award, the amount (if any) due to each Participant and
whether any other material terms (if any) were satisfied. Also, no amount will be paid under this
Plan (and no substitute amount will be paid under any other arrangement) if the conditions imposed
by the Committee have not been met.

SECTION 4

EFFECT OF TERMINATION OF EMPLOYMENT

DURING A PERFORMANCE PERIOD OR PRIOR TO PAYOUT

     4.1 Forfeiture Upon Termination of Employment prior to end of Performance Period. Subject to
Section 6.1 of this Plan, if a Participant’s Employment terminates for any reason other than death,
Disability or Retirement prior to the end of a Performance Period, then such Participant shall
immediately forfeit and relinquish any and all rights and claims to receive any Incentive
Compensation hereunder for such Performance Period.

     4.2 Pro Rata Payment for Termination of Employment Due to Death, Disability or Retirement.
Subject to Section 6.1 of this Plan, if during a Performance Period, a Participant’s Employment is
terminated as a result of his or her death, Disability or Retirement, such Participant shall be
eligible to receive a pro-rata portion of the Incentive Compensation that would have been payable
if such Participant had remained Employed for the full Performance Period, which shall be
determined and paid as follows:

          (a) Following the end of the Performance Period, the Committee will determine the extent to
which the performance objectives applicable to the Participant’s Performance Award have been
satisfied to measure the amount of the Performance Award that otherwise would have been payable to
the Participant under this Plan had his or her Employment not terminated prior to the end of the
Performance Period.

          (b) The Committee will then multiply the amount determined in accordance with Section 4.2(a)
by a fraction, the numerator of which is the number of whole calendar months in which the
terminated, deceased, Disabled or Retired Participant was Employed by the Company as a Participant
in the Plan during the Performance Period and the denominator of which is the number of whole
calendar months in the Performance Period.

          (c) Such resulting amount shall be paid at the time and in the manner provided for in Section
5 of this Plan.

     4.3 Termination of Employment after the Performance Period. If a Participant’s Employment
terminates for any reason except for Cause after the end of a Performance Period but prior to the
Payout Date, then such Participant shall be entitled to payment of any Incentive Compensation for
such Performance Period, as determined by the Committee, on the Payout Date.

     “Cause” when used in connection with the termination of a Participant’s Employment, means the
Participant has (a) caused the Company, other than pursuant to the advice of the

 

 

Company’s legal counsel, to violate a law which, in the opinion of the Company’s legal
counsel, is reasonable grounds for criminal penalties or material civil penalties against the
Company; (b) engaged in misappropriation of a corporate opportunity, dishonesty, fraud,
misappropriation of funds for personal gain or in violation of law, governmental or judicial orders
or otherwise engaged in conduct which constitutes a material violation of the established written
policies or procedures of the Company regarding the conduct of its Employees; (c) committed fraud
or acted with willful misconduct or gross negligence with respect to the Company or the
Participant’s Employment; (d) been indicted or similarly charged by applicable governmental
authorities with, or been convicted of, a felony or any crime involving moral turpitude or a
violation of federal or state securities laws; (e) engaged in repeated disobedience or
insubordination (after written notice of the same from the Company and failure to cure with thirty
(30) days after receipt of such notice, provided that such notice and right to cure shall only be
required for the first occurrence), or has shown willful and persistent inattention to his or her
duties (after written notice of the same and failure to cure within thirty (30) days after receipt
of such notice, provided that such notice and right to cure shall only be required for the first
occurrence); or (f) materially breached the Worthington Industries’ Code of Conduct or any
agreement between the Participant and the Company.

     4.4 Leaves of Absence. A Participant’s Employment for purposes of this Plan shall not be
deemed to have been terminated because of a leave of absence covered under the Federal Medical
Family Leave Act or during any other period required to be treated as a leave of absence or
required to be treated as continued Employment by virtue of any applicable statute or regulation.
If a Participant is on any other approved leave of absence (not specifically addressed in the
immediately preceding sentence) during a Performance Period, his or her Employment will not be
deemed to have terminated for purposes of this Plan, except that such Participant shall not be
eligible for Incentive Compensation for the period of the leave of absence, and the Incentive
Compensation payable for such Performance Period will be prorated in accordance with Section 4.2 of
this Plan based on the number of whole calendar months during the Performance Period in which the
Participant was not on a leave of absence.

     4.5 Committee Determinations Controlling. All determinations regarding a Participant’s
Employment, eligibility to participate in the Plan or in any Performance Period, or amounts owing
to a Participant shall be made by the Committee, whose decision shall be final and binding on the
affected Participant and any Beneficiary.

SECTION 5

PAYMENT OF INCENTIVE COMPENSATION

     Unless a Participant has made a valid election under a deferred compensation plan maintained
by the Company no later than the date permitted under such plan and except as otherwise provided in
Section 6.1 of this Plan, a Participant’s Incentive Compensation for each Performance Period, if
any, shall be paid in a cash lump sum (net of applicable tax and other required withholdings) after
(a) the results for such Performance Period have been finalized and (b) the Committee has made the
certification described in Section 3.7 of this Plan; provided, however, that any Incentive
Compensation shall be paid no later than the later of (i) the 15th day of the third month following
the Participant’s first taxable year in which such Incentive

 

 

Compensation is no longer subject to a substantial risk of forfeiture (within the meaning of
Section 409A of the Code) or (ii) the 15th day of the third month following the end of the first
taxable year of the service recipient (within the meaning of Section 409A of the Code) in which
such Incentive Compensation is no longer subject to a substantial risk of forfeiture.

SECTION 6

CHANGE IN CONTROL

     6.1 Payment on Change in Control. Unless otherwise determined by the Committee in connection
with the establishment of the Performance Award or as otherwise specified in a written agreement
between the Company and the Participant, including the agreement establishing the terms of the
Participant’s Performance Award, if, during a Performance Period, (i) a Change in Control occurs
and (ii) on or after the date of the Change in Control, the Participant’s Employment terminates for
any reason, then, notwithstanding Sections 4.1 and 4.2 of this Plan, the Performance Award of such
Participant shall be considered to be earned and payable as of the date of termination of the
Participant’s Employment in the amount designated as “Target” for such Performance Award.

     Unless a Participant has made a valid election under a deferred compensation plan maintained
by the Company no later than the date permitted under such plan, the Incentive Compensation payable
with respect to the Performance Award in accordance with the preceding paragraph of this Section
6.1 shall be paid within thirty (30) days following the date the Participant’s Employment
terminates.

     6.2 Provisions Not Applicable. The provisions of this Section 6 shall not apply (i) if the
Committee determines at the time of grant of a Performance Award that this Section 6 shall not
apply in respect of such Performance Award or (ii) to any Change in Control when expressly provided
otherwise by a three-fourths (3/4) vote of the Whole Board, but only if a majority of the members
of the Board then in office and acting upon such matter shall be Continuing Directors.

     6.3 Definitions for Section 6. For purposes of this Section 6, unless the context requires
otherwise, the following terms shall have the respective meanings set forth in this Section:

          (a) “Acquiring Person” means any Person or Group (including any individual, firm, corporation
or other entity) who or which, together with all Affiliates and Associates of such Person or Group,
has acquired or obtained the right to acquire the Beneficial Ownership of twenty-five percent
(25%) or more of the Common Shares then outstanding.

          (b) “Act” means the Securities Exchange Act of 1934, as amended, or any successor thereto.

          (c) “Affiliate” and “Associate” shall have the respective meanings ascribed to such terms in
Rule 12b-2 of the General Rules and Regulations under the Act (or any successor rule thereto).

 

 

          (d) “Beneficial Ownership” shall be determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Act (or any successor rule thereto).

          (e) “Change in Control” means any Person or Group (other than (i) the Company, (ii) any
employee benefit plan of the Company or any trustee of or fiduciary with respect to any such
employee benefit plan when acting in such capacity, or (iii) any Person who, on the effective date
of the Plan, is an Affiliate of the Company and owning in excess of ten percent (10%) of the
outstanding Common Shares and the respective successors, executors, legal representatives, heirs
and legal assigns of such Person), alone or together with the Affiliates and Associates of such
Person or Group, has acquired or obtained the right to acquire the Beneficial Ownership of
twenty-five percent (25%) or more of the outstanding Common Shares.

          (f) “Continuing Director” means any individual who was a member of the Board on the effective
date of the Plan or thereafter elected by the shareholders of Worthington or appointed by the Board
prior to the date as of which the Acquiring Person became a Substantial Shareholder (as such term
is defined in Article Seventh of Worthington’s Amended Articles of Incorporation) or, an individual
designated (before his or her initial election or appointment as a director) as a Continuing
Director by three-fourths (3/4) of the Whole Board, but only if a majority of the Whole Board shall
then consist of Continuing Directors.

          (g) “Group” has the meaning given to that term in Sections 13(d)(3) and 14(d)(2) of the Act
(or any successor sections thereto).

          (h) “Person” means a “person,” as such term is used for purposes of Section 13(d) or 14(d) of
the Act (or any successor section thereto).

          (i) “Whole Board” means the total number of directors which Worthington would have if there
were no vacancies.

     6.4 Golden Parachute Limitation. Subject to any other written agreement to the contrary
between the Company and a Participant which implicitly or explicitly encompasses this Plan,
including the agreement establishing the terms of the Participant’s Performance Award, if the sum
of the payments described in this Section 6 and those provided under all other plans, programs or
agreements between the Participant and the Company (collectively, the “Programs”) generate a loss
of deduction under Section 280G of the Code (the “Loss Deduction”) or an excise tax under Section
4999 of the Code (the “Excise Tax”), the amounts paid to the Participant under this Plan in
connection with a Change in Control shall be reduced so that the Participant’s total “parachute
payment” as defined in Section 280G(b)(2)(A) of the Code under this Plan and the Programs will be
$1.00 less than the amount that would generate a Loss Deduction or an Excise Tax but only if this
reduction provides the Participant with an after-tax amount that is greater than the after-tax
amount that would result if no such reduction were made. If there is a dispute regarding this
reduction, the determination of whether a reduction is required, and/or the amount of reduction
required, pursuant to this Section 6.4 shall be made by a nationally recognized certified public
accounting firm designated by the Company and by applying principles, assumptions and procedures
consistent with Section 280G of the Code. Any reduction pursuant to this Section 6.4 shall be made
in compliance with Section 409A of the Code.

 

 

SECTION 7

MISCELLANEOUS PROVISIONS

     7.1 Non-Assignability. A Participant cannot alienate, assign, pledge, encumber, transfer,
sell or otherwise dispose of any rights or benefits under the Plan prior to the actual receipt
thereof, and any attempt to alienate, assign, pledge, encumber, transfer, sell or otherwise make a
disposition prior to such receipt, or any levy, attachment, execution or similar process upon any
such rights or benefits, shall be null and void.

     7.2 No Right to Continue in Employment. Nothing in the Plan confers upon any Participant the
right to continue in the Employment of the Company, or interferes with or restricts in any way the
right of the Company to discharge any Participant at any time.

     7.3 Indemnification of Committee Members. Each individual who is or was a member of the
Committee shall be indemnified by the Company against and from any damage, loss, liability, cost
and expense that may be imposed upon or reasonably incurred by him or her in connection with or
resulting from any claim, action, suit, or proceeding to which he or she is or may be a party, or
in which he or she may be involved, by reason of any action taken or failure to act under the Plan,
except for any such act or omission constituting willful misconduct or gross negligence. Each such
individual shall be indemnified by the Company for all amounts paid by such individual in
settlement thereof, with the Company’s approval, or paid by such individual in satisfaction of any
judgment in any such action, suit, or proceeding against him or her, provided he or she shall give
the Company an opportunity, at its own expense, to handle and defend the same before he or she
undertakes to handle and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to which such
individuals may be entitled from the Company, as a matter of law, or otherwise, or any power that
the Company may have to indemnify them or hold them harmless.

     7.4 No Plan Funding. The Plan shall at all times be entirely unfunded and no provision shall
be made with respect to segregating any assets of the Company for payment of any amounts due
hereunder. No Participant, Beneficiary, or other Person (as defined in Section 6.3 of this Plan)
shall have any interest in any particular assets of the Company by reason of the right to receive
any Incentive Compensation under the Plan until such payment is actually received by such Person.
Participants and Beneficiaries shall have only the rights of general unsecured creditors of the
Company.

     7.5 Governing Law. The Plan shall be construed in accordance with the laws of the State of
Ohio, without regard to its conflicts of law provisions.

     7.6 Binding Effect. The Plan shall be binding upon and inure to the benefit of the Company
and its successors and assigns, and the Participants and their respective Beneficiaries, heirs, and
personal representatives.

     7.7 Construction of Plan. The captions used in the Plan are for convenience of reference only
and shall not be construed in interpreting the Plan. Whenever the context so

 

 

requires, the masculine shall also include the feminine and neuter, and the singular shall
also include the plural, and conversely.

     7.8 Compliance with Section 409A of the Code. It is intended that the Plan be exempt from the
requirements of Section 409A of the Code and the Treasury Regulations promulgated thereunder, and
the Plan will be interpreted, administered and operated accordingly. Nothing herein shall be
construed as an entitlement to or guarantee of any particular tax treatment to a Participant.

     7.9 Beneficiaries. Each Participant may designate a Beneficiary or Beneficiaries (which
Beneficiary may be an entity other than a natural Person (as defined in Section 6.3 of this Plan))
to receive any payments which may be made under this Plan following the Participant’s death. Such
designation may be changed or canceled at any time without the consent of any such Beneficiary.
Any such designation, change or cancellation must be made in a form approved by the Committee and
shall not be effective until received by the Committee. If no Beneficiary has been named, or the
designated Beneficiary or Beneficiaries shall have predeceased the Participant, the Beneficiary
shall be the Participant’s spouse or, if no spouse survives the Participant, the Participant’s
estate. If a Participant designates more than one Beneficiary, the rights of such Beneficiaries
shall be payable in equal shares, unless the Participant has designated otherwise.

SECTION 8

AMENDMENT OR DISCONTINUANCE

     The Committee may at any time, and from time to time, without the consent of any Participant,
amend, revise, suspend or discontinue the Plan, in whole or in part, subject to any shareholder
approval required by applicable law, rules or regulations; provided, however, the Committee may not
amend the Plan to change the method for determining Incentive Compensation or the Performance
Criteria without the approval of the majority of votes cast by the shareholders of the Company in a
separate vote to the extent required by Section 162(m) of the Code.

SECTION 9

EFFECT OF THE PLAN

     Neither the adoption of the Plan, nor any action of the Board or the Committee hereunder,
shall be deemed to give any Participant any right to be granted Incentive Compensation hereunder.
In addition, nothing contained in the Plan, and no action taken pursuant to its provisions, shall
be construed to (a) give any Participant any right to any compensation, except as expressly
provided herein; (b) be evidence of any agreement, contract or understanding, express or implied,
that the Company will employ a Participant in any particular position or for any particular
duration; (c) give any Participant any right, title, or interest whatsoever in, or to, any assets
or investments which the Company may make to aid it in meeting its obligations hereunder; (d)
create a trust or fund of any kind; or (e) create any type of fiduciary relationship between the
Company and a Participant or any other Person (as defined in Section 6.3 of this Plan).

 

 

SECTION 10

TERM

     The Plan shall be effective upon its approval by Worthington’s shareholders on September 24,
2008; provided that such approval is consistent with the shareholder approval requirements of
Section 162(m) of the Code.EX-10.2

Exhibit
10.2

WORTHINGTON INDUSTRIES, INC.

1997 LONG-TERM INCENTIVE PLAN

     Section 1. Purpose

     The purposes of the Worthington Industries, Inc. 1997 Long-Term Incentive Plan (the “Plan”)
are to encourage selected key employees of Worthington Industries, Inc. and its subsidiaries
(collectively the “Company”) to acquire a proprietary and vested interest in the growth and
performance of the Company, to generate an increased incentive to contribute to the Company’s
future success and prosperity, thus enhancing the value of the Company for the benefit of share
owners, and to enhance the ability of the Company to attract and retain individuals of exceptional
talent upon whom, in large measure, the sustained progress, growth and profitability of the Company
depends.

     Section 2. Administration

     The Plan shall be administered by the Committee. The Committee shall have full power and
authority, subject to such orders or resolutions not inconsistent with the provisions of the Plan
as may from time to time be adopted by the Board, to: (i) select the Employees of the Company to
whom Awards may from time to time be granted hereunder; (ii) determine the type or types of Award
to be granted to each Participant hereunder; (iii) determine the number of Shares to be covered by
each Award granted hereunder; (iv) determine the terms and conditions, not inconsistent with the
provision of the Plan, of any Award granted hereunder; (v) determine whether, to what extent and
under what circumstances Awards may be settled in cash, Shares or other property or canceled or
suspended; (vi) determine whether, to what extent and under what circumstances cash, Shares, and
other property and other amounts payable with respect to an Award under the Plan shall be deferred
either automatically or at the election of the Participant; (vii) interpret and administer the Plan
and any instrument or agreement entered into under the Plan; (viii) establish such rules and
regulations and appoint such agents as it shall deem appropriate for the proper administration of
the Plan; and (ix) make any other determination and take any other action that the Committee deems
necessary or desirable for administration of the Plan. Decisions of the Committee shall be final,
conclusive and binding upon all persons, including the Company, any Participant, any shareholder,
and any employee of the Company. A majority of the members of the Committee may determine its
actions and fix the time and place of its meetings.

     Section 3. Duration of, and Shares Subject to Plan

     (a) Term. The Plan shall remain in effect until terminated by the Board, provided,
however, that no Incentive Stock Option may be granted more than ten (10) years after the
Effective Date of the Plan.

     (b) Shares Subject to the Plan. The maximum number of Shares in respect of which
Awards may be granted under the Plan, subject to adjustment as provided in Section 3(c) of
the Plan, is 4,500,000 Shares. Notwithstanding the foregoing, in no event shall more than
1,000,000 Shares be cumulatively available for Awards of Incentive Stock Options under the
Plan and provided further that no Participant may be granted Awards in any one calendar year
with respect to more than two hundred thousand (200,000) Shares.

II-1 

 

For the purpose of computing the total number of Shares available for Awards under the Plan,
there shall be counted against the foregoing limitations the number of Shares subject to
issuance upon exercise or settlement of Award as of the dates on which such Awards are
granted. Shares which were previously subject to Awards shall again be available for Awards
under the Plan if any such Awards are forfeited, terminated, expire unexercised, settled in
cash or property other than Shares or exchanged for other Awards (to the extent of such
forfeiture, termination or expiration of such Awards), or if the Shares subject thereto can
otherwise no longer be issued. Further, any Shares which are used as full or partial
payment to the Company by a Participant of the purchase price of Shares upon exercise of a
Stock Option shall again be available for Awards under the Plan.

Shares which may be issued under the Plan may be either authorized and unissued shares or
issued shares which have been reacquired by the Company. No fractional shares shall be
issued under the Plan.

     (c) Changes in Shares. In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, stock split, reverse stock split, spin off, exchange of
shares or similar transaction or other change in corporate structure or capitalization
affecting the Shares or the price thereof, such adjustments and other substitutions shall be
made to the Plan and to Awards as the Committee in its sole discretion deems equitable or
appropriate, including without limitation such adjustments in the aggregate number, class
and kind of Shares which may be delivered under the Plan, in the aggregate or to any one
Participant, in the number, class, kind and option or exercise price of Shares subject to
outstanding Options, Stock Appreciation Rights or other Awards granted under the Plan, and
in the number, class and kind of Shares subject to, Awards granted under the Plan
(including, if the Committee deems appropriate, the substitution of similar options to
purchase the shares of, or other awards denominated in the shares of, another company) as
the Committee may determine to be appropriate in its sole discretion, provided that the
number of Shares or other securities subject to any Award shall always be a whole number.

     Section 4. Eligibility

     Any Employee (excluding any member of the Committee) shall be eligible to be selected as a
Participant.

     Section 5. Stock Options

     Options may be granted hereunder to Participants either alone or in addition to other Awards
granted under the Plan. Any Option granted under the Plan shall be evidenced by an Award Agreement
in such form as the Committee may from time to time approve. Any such Option shall be subject to
the following terms and conditions and to such additional terms and conditions, not inconsistent
with the provisions of the Plan, as the Committee shall deem desirable. The provisions of Options
need not be the same with respect to each recipient.

     (a) Option Price. The purchase price per Share purchasable under an Option shall be
determined by the Committee in its sole discretion; provided that such purchase price shall
not be less than the Fair Market Value of the Share on the date of the grant of the Option.

     (b) Option Period. The term of each Option shall be fixed by the Committee in its sole
discretion; provided that no Incentive Stock Option shall be exercisable after the
expiration of ten years from the date the Option is granted.

II-2 

 

     (c) Exercisability. Options shall be exercisable at such time or times as determined
by the Committee at or subsequent to grant. Unless other determined by the Committee at or
subsequent to grant, no Incentive Stock Option shall be exercisable during the year ending
on the day before the first anniversary date of the granting of the Incentive Stock Option.

     (d) Method of Exercise. Subject to the other provisions of the Plan and any applicable
Award Agreement, any Option may be exercised by the Participant in whole or in part at such
time or times, and the Participant may make payment of the option price in such form or
forms, including, without limitation, payment by delivery of cash, Shares or other
consideration (including, where permitted by law and the Committee, Awards) having a Fair
Market Value on the exercise date equal to the total option price, or by any combination of
cash, Shares and other consideration as the Committee may specify in the applicable Award
Agreement.

     (e) Incentive Stock Options. In accordance with rules and procedures established by
the Committee, the aggregate Fair Market Value (determined as of the time of grant) of the
Shares with respect to which Incentive Stock Options held by any Participant which are
exercisable for the first time by such Participant during any calendar year under the Plan
(and under any other benefit plans of the Company or of any parent or subsidiary corporation
of the Company) shall not exceed $100,000 or, if different, the maximum limitation in effect
at the time of grant under Section 422 of the Code, or any successor provision, and any
regulations promulgated thereunder. The terms of any Incentive Stock Option granted
hereunder shall comply in all respects with the provisions of Section 422 of the Code, or
any successor provision, and any regulations promulgated thereunder.

     Section 6. Stock Appreciation Rights

     Stock Appreciation Rights may be granted hereunder to Participants either alone or in addition
to other Awards granted under the Plan and may, but need not, relate to a specific Option granted
under Section 5. The provisions of Stock Appreciation Rights need not be the same with respect to
each recipient. Any Stock Appreciation Right related to a Non-Qualified Stock Option may be
granted at any time thereafter before exercise or expiration of such Option. Any Stock
Appreciation Right related to an Incentive Stock Option must be granted at the same time such
Option is granted. In the case of any Stock Appreciation Right related to any Option, the Stock
Appreciation Right or applicable portion thereof shall terminate and no longer be exercisable upon
the termination or exercise of the related Option, except that a Stock Appreciation Right granted
with respect to less than the full number of Shares covered by a related Option shall not be
reduced until the exercise or termination of the related Option exceeds the number of shares not
covered by the Stock Appreciation Right. Any Option related to any Stock Appreciation Right shall
no longer be exercisable to the extent the related Stock Appreciation Right has been exercised.
The Committee may impose such conditions or restrictions on the exercise of any Stock Appreciation
Right as it shall deem appropriate.

     Section 7. Restricted Stock

     (a) Issuance. Restricted Stock Awards may be issued hereunder to Participants either
alone or in addition to other Awards granted under the Plan, for such consideration as
determined by the Committee in its sole discretion and the Committee may issue such Awards
for no consideration or for such minimum consideration as may be required by applicable law.
Restricted Stock Awards shall contain such limitations, terms and conditions and other
provisions as determined by the Committee in its sole discretion. The provisions of
Restricted Stock Awards need not be the same with respect to each recipient.

II-3 

 

     (b) Registration. Any Restricted Stock issued hereunder may be evidenced in such
manner as the Committee in its sole discretion shall deem appropriate, including, without
limitation, book-entry registration or issuance of a stock certificate or certificates. In
the event any stock certificate is issued in respect of shares of Restricted Stock awarded
under the Plan, such certificate shall be registered in the name of the Participant, and
shall bear an appropriate legend referring to the terms, conditions, and restrictions
applicable to such Award.

     (c) Forfeiture. Except as otherwise determined by the Committee at the time of grant,
upon termination of employment for any reason during the restriction period, all shares of
Restricted Stock still subject to restriction shall be forfeited by the Participant and
reacquired by the Company, for the purchase price paid by the Participant or such other
consideration (or no consideration) as set by the Committee as part of the terms and
conditions of the Award, provided that except as provided in Section 11, in the event of a
Participant’s retirement, permanent disability, other termination of employment or death, or
in cases of special circumstances, the Committee may, in its sole discretion, waive in whole
or in part any or all remaining restrictions with respect to such Participant’s shares of
Restricted Stock. Unrestricted Shares, evidenced in such manner as the Committee shall deem
appropriate, shall be issued to the grantee after the period of forfeiture, as determined or
modified by the Committee, shall expire.

     Section 8. Performance Awards

Performance Awards may be issued hereunder to Participants, either alone or in addition to other
Awards granted under the Plan, for such consideration as determined by the Committee, in its sole
discretion, and the Committee may issue such Awards for no consideration or for such minimum
consideration as may be required by applicable law. The performance criteria to be achieved during
any Performance Period, the length of the Performance Period and the other terms and conditions and
provisions with respect to the Award shall be determined by the Committee upon the grant of each
Performance Award. Except as provided in Section 10, Performance Awards will be distributed only
after the end of the relevant Performance Period. Performance Awards may be paid in cash, Shares,
other property or any combination thereof, in the sole discretion of the Committee at the time of
payment. The performance levels to be achieved for each Performance Period and the amount of the
Award to be distributed shall be conclusively determined by the Committee. Performance Awards may
be paid in a lump sum or in installments following the close of the Performance Period. The
maximum value of the property, including cash, that may be paid or distributed to any Participant
pursuant to a grant of Performance Units made in any one calendar year shall be $2,500,000. The
provisions of Performance Awards need not be the same with respect to each recipient.

     Section 9. Other Stock Unit Awards

     (a) Stock and Administration. Other Awards of Shares and other Awards that are valued
in whole or in part by reference to, or are otherwise based on, Shares or other property
(“Other Stock Unit Awards”) may be granted hereunder to Participants, either alone or in
addition to other Awards granted under the Plan. Other Stock Unit Awards may be paid in
Shares, cash or any other form of property as the Committee shall determine.

     (b) Terms and Conditions. Other Stock Unit Awards granted under this Section 9 may be
issued for such consideration as determined by the Committee in its sole discretion, and the
Committee may issue such Awards for no consideration or for such minimum consideration as
may be required by applicable law. Shares (including securities convertible into Shares)
purchased pursuant to a purchase right awarded under this Section 9 shall be purchased for
such consideration

II-4 

 

as the Committee shall in its sole discretion determine, which shall not be less than
the Fair Market Value of such Shares or other securities as of the date such purchase right
is awarded. The terms and conditions and other provisions with respect to Other Stock Unit
Awards shall be determined by the Committee. The provisions of Other Stock Unit Awards need
not be the same with respect to each recipient.

     Section 10. Change in Control Provisions

     (a) Impact of Event. Notwithstanding any other provision of the Plan to the contrary,
but subject to the provisions of Section 10(d), in the event of a Change in Control:

(i) Any Options and Stock Appreciation Rights outstanding as of the date such Change
in Control is determined to have occurred, and which are not then exercisable and
vested, shall become fully exercisable and vested to the full extent of the original
grant; provided, that in the case of a Participant holding a Stock Appreciation
Right who is actually subject to Section 16(b) of the Exchange Act, such Stock
Appreciation Right shall not become fully vested and exercisable unless it shall
have been outstanding for at least six months at the date such Change in Control is
determined to have occurred.

(ii) The restrictions and deferral limitations applicable to any Restricted Stock
shall lapse, and such Restricted Stock shall become free of all restrictions and
limitations and become fully vested and transferable to the full extent of the
original grant.

(iii) All Performance Awards shall be considered to be earned and payable in full,
and any deferral or other restriction shall lapse and such Performance Awards shall
be immediately settled or distributed.

(iv) The restrictions and deferral limitations and other conditions applicable to
any Other Stock Unit Awards or any other Awards shall lapse, and such Other Stock
Unit Awards or such other Awards shall become free of all restrictions, limitations
or conditions and become fully vested and transferable to the full extent of the
original grant.

     (b) Change in Control Cash-Out. Notwithstanding any other provision of the Plan,
during the 60-day period from and after a Change in Control (the “Exercise Period”), if the
Committee shall determine at, or at any time after the time of grant, a Participant holding
an Option shall have the right, whether or not the Option is fully exercisable and in lieu
of the payment of the Purchase Price for the Shares being purchased under the Option and by
giving notice to the Company, to elect (within the Exercise Period) to surrender all or part
of the Option to the Company and to receive cash, within 30 days of such notice, in an
amount equal to the amount by which the Change in Control Price per Share on the date of
such election shall exceed the purchase price per Share under the Option (the “Spread”)
multiplied by the number of Shares granted under the Option as to which the right granted
under this Section 10(b) shall have been exercised; provided, that if the Change in Control
is within six months of the date of grant of a particular Option held by a Participant who
is an officer or director of the Company and is subject to Section 16(b) of the Exchange
Act, no such election shall be made by such Participant with respect to such Option prior to
six months from the date of grant. However, if the end of such 60-day period from and after
a Change-in-Control is within six months of the date of grant of an Option held by a
Participant who is an officer or director of the Company and is subject to Section 16(b) of
the Exchange Act, such Option (unless theretofore exercised) shall be canceled in exchange
for a cash payment to the Participant, effected on the day which is six months and one day
after the date

II-5 

 

of grant of such Option, equal to the Spread multiplied by the number of Shares granted
under the Option.

     (c) Pooling Transaction. Notwithstanding any other provision of this Plan, if any
right granted pursuant to this Plan would make a Change in Control transaction ineligible
for pooling-of-interests accounting under APB No. 16 that (after giving effect to any other
actions taken to cause such transaction to be eligible for such pooling-of-interests
accounting treatment) but for the nature of such grant would otherwise be eligible for such
accounting treatment, the Committee shall have the ability to substitute for the cash
payable pursuant to such right Shares with a Fair Market Value equal to the cash that would
otherwise be payable pursuant thereto.

     (d) Provisions not Applicable. The provisions of this Section 10 shall not apply
(i) if the Committee determines at the time of grant that such Section shall not apply or
(ii) to any Change in Control when expressly provided otherwise by a three-fourths vote of
the Whole Board, but only if a majority of the members of the Board then in office and
acting upon such matters shall be Continuing Directors.

     Section 11. Code Section 162(m) Provisions

     (a) Applicability. Notwithstanding any other provision of this Plan, if the Committee
determines at the time Restricted Stock, a Performance Award or an Other Stock Unit Award is
granted to a Participant that such Participant is, or is likely to be at the time he or she
recognizes income for federal income tax purposes in connection with such Award a Covered
Employee then the Committee may provide that this Section 11 is applicable to such Award.

     (b) Performance Goals. If an Award is subject to this Section 11, then the lapsing of
restrictions thereon and the distribution of cash, Shares or other property pursuant
thereto, as applicable, shall be subject to the achievement of one or more objective
performance goals established by the Committee, which shall be based on the attainment of
one or any combination of the following: specified levels of earnings per share from
continuing operations, operating income, revenues, gross margin, return on operating assets,
return on equity, economic value added, stock price appreciation, total stockholder return
(measured in terms of stock price appreciation and dividend growth), or cost control, of the
Company or an Affiliate or division of the Company for or within which the Participant is
primarily employed, or such other measures as the Committee may determine to comply with the
requirements of Section 162(m) of the Code and the regulations thereunder. Such Performance
Goals also may be based upon the attaining specified levels of performance under one or more
of the measures described above relative to the performance of other corporations. Such
performance goals shall be set by the Committee within the time period prescribed by, and
shall otherwise comply with the requirements of, Section 162(m) of the Code and the
regulations thereunder.

     (c) Limitations on Adjustments. Notwithstanding any provision of this Plan other than
Section 10, with respect to any Award that is subject to this Section 11, the Committee may
not adjust upwards the amount payable pursuant to such Award, nor may it waive the
achievement of the applicable performance goals except in the case of the death or
disability of the Participant.

     (d) Other Restrictions. The Committee shall have the power to impose such other
restrictions on Awards subject to this Section 11 as it may deem necessary or appropriate to
ensure that such Awards satisfy all requirements for “performance based compensation” within
the meaning of Section 162 (m)(4)(B) of the Code or any successor thereto.

II-6 

 

     Section 12. Amendments and Terminations

     The Board may amend, alter or discontinue the Plan, but no amendment, alteration, or
discontinuation shall be made that would impair the rights of an Optionee or Participant under an
Award theretofore granted, without the optionee’s or Participant’s consent, or that without the
approval of the Stockholders would:

     (a) except as is provided in Section 3(c) of the Plan, increase the total number of
shares reserved for the purpose of the Plan; or

     (b) change the employees or class of employees eligible to participate in the Plan.

The Committee may amend the terms of any Award theretofore granted, prospectively or
retroactively, but no such amendment shall impair the rights of any Participant without his
consent.

     Section 13. General Provisions

     (a) No Assignment. Unless the Committee determines otherwise at the time the Award is
granted, no Award, and no Shares subject to Awards described in Section 9 which have not
been issued or as to which any applicable restriction, performance or deferral period has
not lapsed, may be sold, assigned, transferred, pledged or otherwise encumbered, except by
will or by the laws of descent and distribution; provided that, if so determined by the
Committee, a Participant may, in the manner established by the Committee, designate a
beneficiary to exercise the rights of the Participant with respect to any Award upon the
death of the Participant. Each Award shall be exercisable, during the Participant’s
lifetime, only by the Participant or, if permissible under applicable law, by the
Participant’s guardian or legal representative.

     (b) Term of Awards. The term of each Award shall be for such period of months or years
from the date of its grant as may be determined by the Committee; provided that in no event
shall the term of any Incentive Stock Option or any Stock Appreciation Right related to any
Incentive Stock Option exceed a period of ten (10) years from the date of its grant.

     (c) No Right to Award. No Employee or Participant shall have any claim to be granted
any Award under the Plan and there is no obligation for uniformity of treatment of Employees
or Participants under the Plan.

     (d) Written Agreement Required. The prospective recipient of any Award under the Plan
shall not, with respect to such Award, be deemed to have become a Participant, or to have
any rights with respect to such Award, until and unless such recipient shall have executed
an agreement or other instrument evidencing the Award and delivered a fully executed copy
thereof to the Company, and otherwise complied with the then applicable terms and
conditions.

     (e) Adjustments. Except as provided in Section 11, the Committee shall be authorized
to make adjustments in Performance Award criteria or in the terms and conditions of other
Awards in recognition of unusual or nonrecurring events affecting the Company or its
financial statements or changes in applicable laws, regulations or accounting principles.
The Committee may correct any defect, supply any omission or reconcile any inconsistency in
the Plan or any Award in the manner and to the extent it shall deem desirable to carry it
into effect. In the event the Company shall assume outstanding employee benefit awards or
the right or obligation to make future awards

II-7 

 

in connection with the acquisition of another corporation or business entity, the Committee
may, in its discretion, make such adjustments in the terms of Awards under the Plan as it
shall deem appropriate.

     (f) Cancellations and Forfeitures. The Committee shall have full power and authority
to determine whether, to what extent, and under what circumstances, any Award shall be
canceled or suspended. In particular, but without limitation, all outstanding Awards to any
Participant shall be canceled if the Participant, without the consent of the Committee,
while employed by the Company or after termination of such employment becomes associated
with, employed by, renders services to, or owns any interest in (other than any
nonsubstantial interest, as determined by the Committee), any business that is in
competition with the Company or with any business in which the Company has a substantial
interest as determined by the Committee.

In the event a Participant terminates his or her employment with the Company for any reason
whatsoever, and within eighteen (18) months after the date thereof becomes associated with,
employed by, renders services to, or owns any interest in (other than any nonsubstantial
interest, as determined by the Committee), any business that is in competition with the
Company or with any business in which the Company has a substantial interest as determined
by the Committee, the Committee, in its sole discretion, may require such Participant to
return to the Company the economic value of any Award which is realized or obtained
(measured at the date of exercise) by such Participant at any time during the period
beginning on that date which is six months prior to the date of such Participant’s
termination of employment with the Company.

     (g) Securities Laws Restrictions. No Shares shall be issued under the Plan unless
counsel for the Company shall be satisfied that such issuance will be in compliance with
applicable Federal and state securities laws. All certificates for Shares delivered under
the Plan pursuant to any Award shall be subject to such stock-transfer orders and other
restrictions as the Committee may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon which the
Shares are then listed, and any applicable Federal or state securities law, and the
Committee may cause a legend or legends to be put on any such certificates to make
appropriate reference to such restrictions.

     (h) Deferrals. The Committee shall be authorized to establish procedures pursuant to
which the payment of any Award may be deferred. Subject to the provisions of this Plan and
any Award Agreement, the recipient of an Award (including, without limitation, any deferred
Award) may, if so determined by the Committee, be entitled to receive, currently or on a
deferred basis, interest or dividends, or interest or dividend equivalents, with respect to
the number of shares covered by the Award, as determined by the Committee, in its sole
discretion, and the Committee may provide that such amounts (if any) shall be deemed to have
been reinvested in additional Shares or otherwise reinvested.

     (i) Payment Requirements. Except as otherwise required in any applicable Award
Agreement or by the terms of the Plan, recipients of Awards under the Plan shall not be
required to make any payment or provide consideration other than the rendering of services.

     (j) Withholding. The Company shall be authorized to withhold from any Award granted or
payment due under the Plan the amount of withholding taxes due in respect of an Award or
payment hereunder and to take such other action as may be necessary in the opinion of the
Company to satisfy all obligations for the payment of such taxes. The Committee shall be

II-8 

 

authorized to establish procedures for election by Participants to satisfy such
withholding taxes by delivery of, or directing the Company to retain Shares.

     (k) Other Arrangements. Nothing contained in this Plan shall prevent the Board from
adopting other or additional compensation arrangements, subject to stockholder approval if
such approval is otherwise required, and such arrangements may be either generally
applicable or applicable only in specific cases.

     (l) Applicable Law. The validity, construction, and effect of the Plan and any rules
and regulations relating to the Plan shall be determined in accordance with the laws of the
State of Delaware and applicable Federal law.

     (m) Invalid Provisions. If any provision of this Plan is or becomes or is deemed
invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or any
Award under any law deemed applicable by the Committee, such provision shall be construed or
deemed amended to conform to applicable laws or if it cannot be construed or deemed amended
without, in the determination of the Committee, materially altering the intent of the Plan,
it shall be stricken and the remainder of the Plan shall remain in full force and effect.

     (n) Foreign Nationals. Awards may be granted to Employees who are foreign nationals or
employed outside the United States, or both, on such terms and conditions different from
those specified in the Plan as may, in the judgment of the Committee, be necessary or
desirable in order to recognize differences in local law or tax policy. The Committee also
may impose conditions on the exercise or vesting of Awards in order to minimize the
Company’s obligation with respect to tax equalization for Employees on assignments outside
their home country.

     (o) No Right to Employment. Neither the adoption of the Plan nor the granting of any
Award shall confer upon any employee of the Company any right to continued employment with
the Company, nor shall it interfere in any way with the right of the Company to terminate
the employment of any of its employees at any time, with or without cause.

     (p) Treatment as Compensation for Other Purposes. Payments and other benefits received
by a Participant under an Award made pursuant to the Plan shall not be deemed a part of a
Participant’s regular, recurring compensation for purposes of the termination indemnity or
severance pay law of any country and shall not be included in, nor have any effect on, the
determination of benefits under any other employee benefit plan or similar arrangement
provided by the Company unless expressly so provided by such other plan or arrangements, or
except where the Committee expressly determines that an Award or portion of an Award should
be included to accurately reflect competitive compensation practices or to recognize that an
Award has been made in lieu of a portion of competitive annual cash compensation. Awards
under the Plan may be made in combination with or in tandem with, or as alternatives to,
grants, awards or payments under any other Company plans. The Plan notwithstanding, the
Company may adopt such other compensation programs and additional compensation arrangements
as it deems necessary to attract, retain and reward employees for their service with the
Company.

     Section 14. Effective Date of the Plan

     The Plan shall be effective on the Effective Date.

II-9 

 

     Section 15. Definitions

     As used in the Plan, the following terms shall have the meanings set forth below:

     (a) “Award” shall mean any Option, Stock Appreciation Right, Restricted Stock Award,
Performance Share, Performance Unit, Dividend Equivalent, Other Stock Unit Award, or any
other right, interest, or option relating to Shares granted pursuant to the provisions of
the Plan.

     (b) “Award Agreement” shall mean any written agreement, contract, or other instrument
or document evidencing any Award granted by the Committee hereunder.

     (c) “Board” shall mean the Board of Directors of Worthington Industries, Inc.

     (d) “Change in Control” shall mean the following:

(i) A Change in Control shall have occurred when any Acquiring Person (other than
(A) Worthington or any Worthington Subsidiary, (B) any employee benefit plan of the
Company or any trustee of or fiduciary with respect to any such plan when acting in
such capacity, or (C) any person who, on the Effective Date of the Plan, is an
Affiliate of this Company and owning in excess of ten percent (10%) of the
outstanding shares of the Company and the respective successors, executors, legal
representatives, heirs and legal assigns of such person), alone or together with its
Affiliates and Associates, has acquired or obtained the right to acquire the
beneficial ownership of twenty-five percent (25%) or more of the Shares then
outstanding.

(ii) “Acquiring Person” means any person (any individual, firm, corporation or other
entity) who or which, together with all Affiliates and Associates, has acquired or
obtained the right to acquire the beneficial ownership of twenty-five percent (25%)
or more of the Shares then outstanding.

(iii) “Affiliate” and “Associate” shall have the respective meanings ascribed to
such terms in Rule 12b-2 of the General Rules and Regulations under the Exchange
Act.

(iv) “Continuing Director” means any person who was a member of the Board on the
Effective Date of the Plan or thereafter elected by the shareholders or appointed by
the Board prior to the date as of which the acquiring Person became a Substantial
Shareholder (as such term is defined in Article Six of the Company’s Certificate of
Incorporation) or, a person designated (before his initial election or employment as
a director) as a Continuing Director by three-fourths of the Whole Board, but only
if a majority of the Whole Board shall then consist of Continuing Directors.

(v) “Whole Board” means the total number of directors which the Company would have
if there were no vacancies.

     (e) “Change in Control Price Per Share” shall mean the highest price per Share (i) paid
by the Acquiring Person in connection with the transactions that results in the Change in
Control; or (ii) paid or offered by the Acquiring Person, to acquire other Shares in excess
of 1% of the outstanding shares, at any time after the change in control and before the
Participant exercises his election under Section 10(b).

II-10 

 

     (f) “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time,
and any successor thereto.

     (g) “Committee” shall mean the Compensation and Stock Option Committee of the Board,
composed of no fewer than three directors, each of whom is a Disinterested Person and an
“outside director” within the meaning of Section 162(m) of the Code.

     (h) “Company” shall mean Worthington Industries, Inc., a Delaware corporation, and its
subsidiaries, direct or indirect. Subsidiaries of the Company shall include any entity of
which the Company owns 50% or more.

     (i) “Covered Employee” shall mean a “covered employee” within the meaning of
Section 162(m)(3) of the Code.

     (j) “Disinterested Person” shall have the meaning set forth in Rule 16b-3(d)(3)
promulgated by the Securities and Exchange Commission under the Exchange Act or any
successor definition adopted by the Securities and Exchange Commission.

     (k) “Dividend Equivalent” shall mean any right granted pursuant to Section 14(h)
hereof.

     (l) “Effective Date” shall mean September 18, 1997.

     (m) “Employee” shall mean any salaried employee of the Company. Unless otherwise
determined by the Committee in its sole discretion, for purposes of the Plan, an Employee
shall be considered to have terminated employment and to have ceased to be an Employee if
his or her employer ceases to be a subsidiary of Worthington, even if he or she continues to
be employed by such employer.

     (n) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time
to time, and any successor thereto.

     (o) “Fair Market Value” shall mean, with respect to any property, the fair market value
of such property determined pursuant to the regulations issued under Section 422 of the Code
or by such other methods or procedures as shall be established from time to time by the
Committee.

     (p) “Incentive Stock Option” shall mean an Option granted under Section 5 hereof that
is intended to meet the requirements of Section 422 of the Code or any successor provision
thereto.

     (q) “Non-Qualified Stock Option” shall mean an Option granted under Section 5 hereof
that is not intended to be an Incentive Stock Option.

     (r) “Option” shall mean any right granted to a Participant under the Plan allowing such
Participant to purchase Shares at such price or prices and during such period or periods as
the Committee shall determine.

     (s) “Other Stock Unit Award” shall mean any right granted to a Participant by the
Committee pursuant to Section 9 hereof.

II-11 

 

     (t) “Participant” shall mean an Employee who is selected by the Committee to receive an
Award under the Plan.

     (u) “Performance Award” shall mean any Award of Performance Shares or Performance Units
pursuant to Section 8 hereof.

     (v) “Performance Period” shall mean that period established by the Committee at the
time any Performance Award is granted or at any time thereafter during which any performance
goal specified by the Committee with respect to such Award are to be measured.

     (w) “Performance Share” shall mean any grant pursuant to Section 8 hereof of a unit
valued by reference to a designated number of Shares, which value may be paid to the
Participant by delivery of such property as the Committee shall determine, including,
without limitation, cash, Shares, or any combination thereof, upon achievement of such
performance goals during the Performance Period as the Committee shall establish at the time
of such grant or thereafter.

     (x) “Performance Unit” shall mean any grant pursuant to Section 8 hereof of a unit
valued by reference to a designated amount of property other than Shares, which value may be
paid to the Participant by delivery of such property as the Committee shall determine,
including, without limitation, cash, Shares, or any combination thereof, upon achievement of
such performance goals during the Performance Period as the Committee shall establish at the
time of such grant or thereafter.

     (y) “Person” shall mean any individual, corporation, partnership, association,
joint-stock company, trust, unincorporated organization, limited liability company, other
entity or government or political subdivision thereof.

     (z) “Restricted Stock” shall mean any Share issued with the restriction that the holder
may not sell, transfer, pledge, or assign such Share and with such other restrictions as the
Committee, in its sole discretion, may impose (including, without limitation, any
restriction on the right to vote such Share, and the right to receive any cash dividends),
which restrictions may lapse separately or in combination at such time or times, in
installments or otherwise, as the Committee may deem appropriate.

     (aa) “Restricted Stock Award” shall mean an award of Restricted Stock under Section 7
hereof.

     (bb) “Shares” shall mean the shares of common stock, $.01 par value, of the Company and
such other securities of the Company as the Committee may from time to time determine.

     (cc) “Stock Appreciation Right” shall mean any right granted to a Participant pursuant
to Section 6 hereof to receive, upon exercise by the Participant, the excess of (i) the Fair
Market Value of one Share on the date of exercise or, if the Committee shall so determine in
the case of any such right other than one related to any Incentive Stock Option, at any time
during a specified period before the date of exercise over (ii) the grant price of the right
on the date of grant, or if granted in connection with an outstanding Option on the date of
grant of the related Option, as specified by the Committee in its sole discretion, which,
other than in the case of substitute awards, shall not be less than the Fair Market Value of
one Share on such date of grant of the right or the related Option, as the case may be. Any
payment by the Company in respect of such right may be

II-12 

 

made in cash, Shares, other property, or any combination thereof, as the Committee, in
its sole discretion, shall determine.

     (dd) “Worthington” shall mean Worthington Industries, Inc., an Ohio corporation.

II-13

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}]]