OREGON STEEL MILLS, INC.
2000 NONQUALIFIED STOCK OPTION PLAN
NOTICE OF STOCK OPTION GRANT
----------------------------
OPTIONEE:
Optionee
[Optionee Address]
---------------------------
You have been granted an option to purchase Common Stock of Oregon Steel Mills,
Inc., a Delaware corporation (the "Company") as follows:
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BOARD APPROVAL DATE: October 26, 2000
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GRANT DATE: October 26, 2000
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EXERCISE PRICE PER SHARE: $ 1.9375
(subject to adjustment -
Section 13 of Plan)
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TOTAL NUMBER OF SHARES UNDERLYING
OPTION GRANTED: 00,000
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TOTAL EXERCISE PRICE: $
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TYPE OF OPTION: Nonstatutory
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EXPIRATION DATE: October 25, 2010
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VESTING COMMENCEMENT DATE: October 26, 2000
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VESTING/EXERCISE SCHEDULE: So long as your employment
relationship with the Company or an
Affiliate continues, the Shares
underlying this Option shall vest
and become exercisable in
accordance with the following
schedule:
(1) ___ shares - (50%) on October 26,
2000
(2) ___ shares - (16.7%) on October 26,
2001
(3) ___ shares - (16.7%) on October 26,
2002
(4) ___ shares - (16.6%) on October 26,
2003
1 - NOTICE OF GRANT OF STOCK OPTION
<PAGE>
TERMINATION PERIOD: See Section 4 of the Stock Option
Agreement (but in no event later than the
Expiration Date). Optionee is responsible
for keeping track of these exercise
periods following termination for any
reasons of his or her employment
relationship with the Company or an
Affiliate. The Company will not provide
further notice of such periods.
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TRANSFERABILITY: This Option may not be transferred except
as provided in Section 5 of the Stock
Option Agreement.
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PERFORMANCE TARGETS" None.
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ADDITIONAL TERMS: None.
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By your signature and the signature of the Company's representative below, you
and the Company agree that this Option is granted under and governed by the
terms and conditions of the Oregon Steel Mills, Inc. 2000 Nonqualified Stock
Option Plan ("Plan") and the Stock Option Agreement, both of which are attached
and made a part of this document.
In addition, you agree and acknowledge that your rights to any Shares underlying
the Option will be earned only as you provide services to the Company over time,
that the grant of the Option is not as consideration for services you rendered
to the Company prior to your Vesting Commencement Date, and that nothing in this
Notice or the attached documents confers upon you any right to continue your
employment relationship with the Company for any period of time, nor does it
interfere in any way with your right or the Company's right to terminate that
relationship at any time, for any reason, with or without cause.
This Notice of Grant may be executed in two or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one
document.
OREGON STEEL MILLS, INC., a Delaware corporation
By:
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Name:
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Title:
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2 - NOTICE OF GRANT OF STOCK OPTION
<PAGE>
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3 - NOTICE OF GRANT OF STOCK OPTION
<PAGE>
COMMUNITY PROPERTY STATEMENT
The undersigned spouse of Optionee has read and approves the terms and
conditions of the Plan and this Stock Option Agreement. In condition of the
Company's granting his or her spouse the right to purchase Shares as set forth
in the Plan and this Stock Option Agreement, the undersigned agrees to be
irrevocably bound by the terms and conditions of the Plan and this Stock Option
Agreement and further agrees that any community property interest shall be
similarly bound. The undersigned appoints the undersigned's spouse as
attorney-in fact for the undersigned with respect to any amendment or exercise
of rights under the Plan or this Stock Option Agreement.
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Spouse of Optionee
4 - NOTICE OF GRANT OF STOCK OPTION
<PAGE>
EXHIBIT A
OREGON STEEL MILLS, INC.
2000 NONQUALIFIED STOCK OPTION PLAN
STOCK OPTION AGREEMENT
----------------------
1. GRANT OF OPTION. Oregon Steel Mills, Inc. a Delaware corporation (the
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"Company"), grants to Optionee an option (the "Option") to purchase a total
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number of shares of Common Stock (the "Shares") set forth in the Notice of Stock
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Option Grant (the "Notice"), at the exercise price per Share set forth in the
------
Notice (the "Exercise Price") subject to the terms, definitions and provisions
--------------
of the Company's 2000 Nonqualified Stock Option Plan (the "Plan") adopted by the
----
Company, which is incorporated in this Agreement by reference. Unless otherwise
defined in this Agreement, the terms used in this Agreement shall have the
meanings defined in the Plan. This Stock Option Agreement shall be deemed
executed by the Company and the Optionee upon execution by such parties of the
Notice. This Option is intended to be a Nonstatutory Stock Option.
2. EXERCISE OF OPTION. This Option shall be exercisable during its term
------------------
in accordance with the Vesting/Exercise Schedule set out in the Notice of
Stock Option Grant and with the provisions of Section 9 of the Plan as follows:
(a) RIGHT TO EXERCISE.
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(i) This Option may not be exercised for a fraction of a
share.
(ii) In the event of Optionee's death, disability, retirement
or other termination of employment, the exercisability of the Option is governed
by Section 4 below, but in no event may this Option be exercised after the
Expiration Date of this Option as set forth in the Notice.
(b) METHOD OF EXERCISE.
------------------
(i) This Option shall be exercisable by delivering to the
Company a written notice of exercise (in the form attached as Exhibit A or in
---------
any other form of notice approved by the Committee) which shall state Optionee's
election to exercise the Option, the number of Shares in respect of which the
Option is being exercised, and such other representations and agreements as to
the holder's investment intent with respect to such Shares as may be required by
the Company pursuant to the provisions of the Plan. Such written notice shall be
signed by Optionee and shall be delivered to the Company by such means as are
provided in the Plan. The written notice shall be accompanied by payment in full
of the Exercise Price. The date that the payment in full is received by the
Company will be the exercise date.
(ii) No Share will be issued upon exercise of this Option,
and the Optionee will have no right or claim to such Shares, unless and until:
(a) payment in full as provided in the Plan has been received by the Company;
(b) in the opinion of counsel for the Company, all applicable requirements of
law and of regulatory bodies having jurisdiction over such issuance and delivery
have been fully complied with; and (c) if required by federal or state law or
regulation, the Optionee has paid to the Company the amount, if any, required
to be
1
<PAGE>
withheld on the amount deemed to be compensation to the Participant as a result
of the exercise of his or her Option, or made other arrangements satisfactory to
the Company, in its sole discretion, to satisfy applicable income tax
withholding requirements.
3. METHOD OF PAYMENT. Payment of the Exercise Price shall be by any of the
-----------------
following, or a combination thereof, at the election of Optionee:
(a) cash or other immediately available funds;
(b) cancellation of vested Options with payment credited towards the
amount due from the Optionee at the then Fair Market Value per Share minus the
Exercise Price per Share, multiplied by the number of Options cancelled;
(c) surrender of other shares of Common Stock of the Company which
(i) in the case of Shares acquired pursuant to the exercise of a Company option,
have been owned by Optionee for more than six (6) months on the date of
surrender, and (ii) payment credited towards the amount due from the Optionee at
the then Fair Market Value per Share.
4. TERMINATION OF RELATIONSHIP. Following the date of termination of
---------------------------
Optionee's employment with the Company or any Affiliate for any reason (the
"Termination Date"), Optionee may exercise this Option only as set forth in
Notice and this Section 4. In no event, may any Option be exercised after the
Expiration Date of the Option as set forth in the Notice.
(a) Termination of Employment. Except as provided otherwise in this
-------------------------
Section 4, if the Optionee terminates employment with the Company or any
Affiliate, then, any unvested Options held by the Optionee will terminate, be
forfeited and have no value. Any vested and unexercised Options held by the
Optionee to the extent exercisable on the date of the Optionee's termination of
employment, may be exercised in whole or in part by the Optionee, not later than
the 90th day following the Optionee's termination of employment. Transfer of the
Optionee from employment by the Company to employment by an Affiliate, or vice
versa, will not be deemed a termination of employment.
(b) On Account of Disability or Death. If the Optionee terminates
employment with the Company or any Affiliate on account of Disability or death,
then any unvested Options held by the Optionee will be deemed vested on the date
of such termination of employment. Any exercisable Options may be exercised in
whole or in part by the Optionee in the case of Disability, or by the Optionee's
personal representative in the case of death, no later than the 180th day
following the Optionee's date of Disability or death.
(c) On Account of Retirement. If the Optionee terminates employment
------------------------
with the Company or any Affiliate on account of Retirement, then any unvested
Options held by the Affiliate will be deemed vested on the date of such
termination of employment. Any exercisable Options may be exercised in whole or
in part by the Optionee no later than the 90th day following the Optionee's date
of Retirement.
5. NON-TRANSFERABILITY OF OPTION. This Option may not be transferred in
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any manner other than by will or by the laws of descent or distribution and may
be exercised during the
2
<PAGE>
lifetime of Optionee only by him or her. The terms of this Option shall be
binding upon the executors, administrators, heirs, successors and assigns of
Optionee.
6. TAX CONSEQUENCES. Below is a brief summary as of the date of this
----------------
Option of certain of the federal tax consequences of exercise of this Option and
disposition of the Shares under the laws in effect as of the Grant Date. THIS
SUMMARY IS INCOMPLETE AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING
OF THE SHARES.
(a) EXERCISE OF NONSTATUTORY STOCK OPTION. If the case of a
-------------------------------------
Nonstatutory Stock Option, there may be a regular federal (and state) income tax
liability upon the exercise of the Option. Optionee will be treated as having
received compensation income (taxable at ordinary income tax rates) equal to the
excess, if any, of the fair market value of the Shares on the date of exercise
over the Exercise Price. If Optionee is an employee, the Company will be
required to withhold from Optionee's compensation or collect from Optionee and
pay to the applicable taxing authorities an amount equal to a percentage of this
compensation income at the time of exercise.
(b) DISPOSITION OF SHARES. In the case of a Nonstatutory Stock
---------------------
Option, if Shares are held for at least one year, any gain realized on
disposition of the Shares will be treated as long-term capital gain for federal
income tax purposes.
7. EFFECT OF AGREEMENT. Optionee acknowledges receipt of a copy of the Plan
-------------------
represents that he or she is familiar with the terms and provisions of the Plan
and (and has had an opportunity to consult counsel regarding the Option terms),
and accepts this Option and agrees to be bound by its contractual terms as set
forth in this Agreement and the Plan. Optionee agrees to accept as binding,
conclusive and final all decisions and interpretations of the Committee
regarding any questions relating to the Option. In the event of a conflict
between the terms and provisions of the Plan and the terms and provisions of the
Notice and this Agreement, the Plan terms and provisions shall prevail. The
Option, including the Plan, constitutes the entire agreement between Optionee
and the Company on the subject matter and supersedes all proposals, written or
oral, and all other communications between the parties relating to such subject
matter.
[END OF STOCK OPTION AGREEMENT]
-----------------------------
3
<PAGE>
APPENDIX B
OREGON STEEL MILLS, INC.
2000 NONQUALIFIED STOCK OPTION PLAN
(Effective Date: January 1, 2000)
1. Purposes. The purposes of this Plan are to motivate, attract and retain
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the services of the Participants who make significant contributions to the
Company; to further the growth and financial success of the Company and its
Affiliates by aligning the interests of the Participants with the interests of
the Company's stockholders; and to provide the Participants with an incentive
for long-term value creation.
2. Definitions. As used in this Plan, the terms defined in this Section 2
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will have the following meanings:
2.1 "Affiliate" means any corporation or any other entity (including,
---------
but not limited to, partnerships, limited liability companies, joint ventures
and Subsidiaries) controlling, controlled by or under common control with the
Company.
2.2 "Board" or "Board of Directors" means the Board of Directors of
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the Company.
2.3 "Capital Transaction" is defined in Section 13.2.
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2.4 "CEO" means the Chief Executive Officer of the Company.
---
2.5 "Code" means the Internal Revenue Code of 1986, as amended, and
----
regulations and rulings thereunder. References to a particular section of, or
rule under, the Code will include references to successor provisions.
2.6 "Committee" means the Board or a Committee which has been
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established to administer the Plan in accordance with Section 4.1; provided that
the composition of such Committee shall at all times meet the requirements of
Rule 16b-3 under the 1934 Act, and Code Section 162(m), each as amended.
2.7 "Common Stock" means the common stock of the Company, $.01 par
------------
value.
2.8 "Company" means Oregon Steel Mills, Inc., a Delaware corporation
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and any successor, whether by merger, ownership of all or substantially all of
its assets, or otherwise.
2.9 "Disability" means a mental or physical condition which, in the
----------
opinion of the Committee, renders the Participant unable or incompetent to carry
out the job responsibilities which such Participant held or the tasks to which
such the Participant was assigned at the time the disability was incurred, and
which is expected to be permanent or for an indefinite duration exceeding ninety
days.
2.10 "Effective Date" means January 1, 2000.
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2.11 "Exercise Price" means the Fair Market Value per Share as of the
--------------
Grant Date.
2.12 "Fair Market Value" means, on any given date, the closing price
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of a share of Common Stock as reported by the New York Stock Exchange composite
tape on such day, or if the Common Stock is not traded on such day, then on the
next preceding day that the Common Stock was traded, all as reported by such
source as the Committee may select.
2.13 "Grant Date" means the date on which the Option is granted.
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2.14 "1934 Act" means the Securities Exchange Act of 1934, as amended.
--------
References to a particular section of, or rule under, the 1934 Act will include
references to successor provisions.
2.15 Nonstatutory Stock Option ("NSO") means a stock option, which
---------------------------------
does not qualify for special tax treatment under Section
421 or 422 of the Code.
2.16 "Option" means the right to purchase Common Stock under this
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Plan as granted pursuant to the provisions of Section 7 of this Plan.
2.17 "Option Shares" means Common Stock covered by and subject to any
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outstanding unexercised Option granted pursuant to this Plan.
2.18 "Performance Period" means the Year or Years with respect to
------------------
which the Performance Targets are set by the Committee.
2.19 "Performance Target" means the specific objective goal or goals
-------------------
(which may be cumulative and/or alternative) that are set in writing by the
Committee for each Participant for the Performance Period based on Return on
Assets or any other business factor or criteria as determined by the Committee.
2.20 "Plan" means this Oregon Steel Mills, Inc. 2000 Nonqualified
----
Stock Option Plan, as amended from time to time.
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2.21 "Participant" means executives and senior corporate and plant
-----------
managers of the Company or of an Affiliate, selected to participate in the
Plan by the Committee.
2.22 "Retirement" means termination of employment with the Company
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or an Affiliate after attaining age 65 with at least 5 years of service with
either the Company or an Affiliate, or both.
2.23 "Return on Assets" means, for any Year, operating income divided
----------------
by average of the total assets of the Company (assets at the beginning of year
plus assets at the end of the year divided by 2).
2.24 "Shares" mean shares of Common Stock or any securities or
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property, including rights into which the same may be converted by operation of
law or otherwise.
2.25 "Subsidiary" means any entity in which the Company directly or
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through intervening subsidiaries owns more than fifty percent (50%) or more of
the total combined voting power or value of all classes of stock or, in the case
of an unincorporated entity, owns more than a fifty percent (50%) interest in
the capital and profits.
2.26 "Withholding Taxes" means all income taxes, FICA, FUTA, or
-----------------
similar employment taxes and any other taxes or assessments payable as the
result of an exercise of the Option.
2.27 "Year" means any one or more fiscal years of the Company
----
commencing on or after January 1, 2000 that represent(s) the applicable
Performance Period and end(s) no later than December 31, 2009.
3. Selection of Participants. For each Performance Period, the Committee
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shall determine, at the time the Performance Target(s) are set, those
Participants who will participate in the Plan.
4. Administration.
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4.1 The Committee.
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4.1.1 This Plan will be administered by the Board of Directors
directly, acting as a Committee, or if the Board elects, by the Compensation
Committee or a separate Committee appointed by the Board for that purpose and
consisting of two or more Board members who must be "Non-Employee Directors" as
that term is defined in Rule 16b-3 promulgated under the 1934 Act. Once
appointed, any such Committee will continue to serve until otherwise directed by
the Board. From time to time, the Board may increase the size of the Committee
and appoint additional members, remove members (with or without cause), appoint
new members in substitution, and fill vacancies however caused, except that any
new member must be a "Non-Employee Director" as that term is defined in Rule
16b-3. The Committee may select one of its members as its chairperson, and will
hold meetings at such times and places as the chairperson or a majority of the
Committee may determine. At all times, the Board will have the power to remove
all members of the Committee and thereafter to directly administer this Plan as
a Committee of the whole. A majority of the members of the Committee will
constitute a quorum. All actions of the Committee will be taken by a majority
vote of the members constituting a quorum or by unanimous written consent of all
members of the Committee without a meeting. Any action may be taken by a written
instrument signed by all Committee members, and all actions so taken will be
fully effective as if it has been taken by a vote of a majority of the members
at a meeting duly called and held.
4.1.2 The Committee may authorize any one or more of their number
or the Secretary or any other officer of the Company to execute and deliver
documents on behalf of the Committee. The Board authorizes the Secretary to
execute and deliver all documents to be delivered by the Committee pursuant to
this Plan.
4.1.3 The CEO will present grant recommendations annually to the
Committee.
4.2 Powers of the Committee. Subject to the express provisions of this
Plan, the Committee will have full and final authority, in its discretion, as
follows:
4.2.1 to establish the terms and conditions upon which Options
may be granted, vested or exercised, including establishing the Performance
Target(s);
4.2.2 to grant Options;
4.2.3 to interpret this Plan and to make all determinations
necessary or advisable for the administration of this Plan;
4.2.4 to determine those persons who will participate in this
Plan;
4.2.5 to determine the Fair Market Value on any applicable
valuation date;
4.2.6 to determine whether an event of termination of employment,
death, Disability, or Retirement has occurred under Section 12 of this Plan;
4.2.7 to prescribe, amend, and rescind rules and regulations
relating to this Plan, including rules with respect to the exercisability and
nonforfeitability of Options upon the termination of employment of a
Participant;
B-2
<PAGE>
4.2.8 to authorize any person or persons to execute and deliver
Option grant agreements or to take any other actions deemed by the Committee to
be necessary or appropriate to effectuate the grant of Options;
4.2.9 to determine the terms and provisions and any restrictions
or conditions, which need not be identical, of grants under the Plan and with
the consent of the Participant, to modify any such grant at any time;
4.2.10 to cancel, with the consent of the Participant,
outstanding Options and to grant new Options in substitution therefor;
4.2.11 to alter any restrictions or conditions upon any Option;
4.2.12 to correct any defect or supply any omission or reconcile
any inconsistency in the Plan or in any grant under the Plan in the manner and
to the extent it may deem expedient;
4.2.13 to establish, define and/or interpret any terms and
conditions of this Plan; and
4.2.14 to make all other determinations (which may be on a
case-by-case basis) deemed necessary or desirable for the administration of the
Plan.
The determination of the Committee on all matters relating to this Plan
will be conclusive and final. No member of the Committee or of the Board will be
liable for any actions taken or omitted and made in good faith with respect to
this Plan or any Option.
5. Shares Subject to this Plan.
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5.1 Subject to adjustment as provided in Section 13 of this Plan, an
aggregate of 1,000,000 Shares will be available for issuance to the Participants
under this Plan. No fractional shares will be issued.
5.2 The Shares deliverable upon exercise of the Option granted under
this Plan may be made available from authorized but unissued Shares or Shares
reacquired by the Company, including Shares purchased in the open market or in
private transactions.
6. Nonstatutory Options.
--------------------
All Options granted to the Participants pursuant to this Plan will be NSOs.
7. Grants to Participants.
----------------------
7.1 The Committee may grant Options to the Participants from time to
time. With respect to each grant of Options, the Committee will set forth:
7.1.1 the Participant to receive the Options;
7.1.2 the number of Options granted to each Participant;
7.1.3 the Grant Date;
7.1.4 the Performance Target(s);
7.1.5 the Exercise Price; and
7.1.6 the vesting schedule.
7.2 Each Option granted under this Plan will be evidenced by a written
Option grant agreement. Each grant agreement will be subject to, and
incorporated by reference or otherwise, the applicable terms of this Plan.
7.3 The terms of an Option need not be identical, and the Committee
need not treat Participants uniformly.
8. Duration and Vesting of Options.
-------------------------------
8.1 The term of each Option granted to a Participant will be for ten
(10) years from the Grant Date, unless terminated earlier pursuant to the
provisions of Section 12 of this Plan.
8.2 The Participant must be employed on each vesting date for each
Option to vest and be exercisable.
8.3 Subject to Sections 12 and 13, each Option will vest and become
fully exercisable under one of the two methods provided below as determined by
the Committee:
8.3.1 (a) one half of each grant will vest over 4 years at the
rate of 25% per year, with the first 25% vesting on the first anniversary of the
Grant Date, and an additional 25% on each anniversary of the Grant Date
thereafter; and (b) one half of each grant will vest upon the earlier of the
Company achieving the Performance Target or if the Performance Target is not
met, on the seventh anniversary of the Grant Date; or
8.3.2 the vesting schedule as recommended by the CEO and approved
by the Committee.
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<PAGE>
9. Exercise Price; Exercise.
------------------------
9.1 The price per Share of the Option Shares which may be purchased
upon exercise of an Option will be equal to the Exercise Price. The Exercise
Price per Share will be paid in full at the time the Option is exercised in
accordance with Section 10.
9.2 The Exercise Price per Share will be subject to adjustment as
provided in Section 13 of this Plan.
9.3 To the extent that it is exercisable, an Option will be exercised
by written notice to the Company stating the number of Shares with respect to
which the Option is being exercised and be accompanied by full payment for the
Shares. The date that the payment in full is received by the Company will be the
exercise date.
9.4 Any person or persons exercising an Option on behalf of the
Participant will be required to furnish to the Company appropriate documentation
that such person or persons have the full legal right and power to exercise the
Option on behalf of and for the Participant.
10. Payment by the Participant. Payment by the Participant of the Exercise
--------------------------
Price per Share and any taxes required to be withheld on the Participant's
behalf incident to exercise of the Option will be by any combination of cash,
other immediately available funds, cancellation of vested Options or Common
Stock. If the Participant chooses to make payment by canceling vested Options,
such payment will be credited towards the amount due from the Participant at the
then Fair Market Value per Share minus the Exercise Price per Share, multiplied
by the number of Options cancelled. If the Participant chooses to make payment
with Common Stock, such payment will be credited towards the amount due from the
Participant at the then Fair Market Value per Share.
Notwithstanding the foregoing, the Committee also may allow exercises by
any other means which the Committee determines to be consistent with the Plan's
purpose and applicable law.
11. Taxes. Any Option granted under this Plan will provide for payment by
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the Participant on exercise of all federal, state, local or other Withholding
Taxes payable by the Company incident to exercise of an Option.
12. Effect of Termination of Employment, Death, Disability or Retirement.
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12.1 Termination of Employment. Except as provided otherwise in this
-------------------------
Section 12, if the Participant terminates employment with the Company or any
Affiliate, then, any unvested Options held by the Participant will terminate, be
forfeited and have no value. Any vested and unexercised Options held by the
Participant to the extent exercisable on the date of the Participant's
termination of employment, may be exercised in whole or in part by the
Participant, not later than the 90th day following the Participant's termination
of employment. Transfer of the Participant from employment by the Company to
employment by an Affiliate, or vice versa, will not be deemed a termination of
employment.
12.2 On Account of Disability or Death. If the Participant terminates
---------------------------------
employment with the Company or any Affiliate on account of Disability or death,
then any unvested Options held by the Participant will be deemed vested on the
date of such termination of employment. Any exercisable Options may be exercised
in whole or in part by the Participant in the case of Disability, or by the
Participant's personal representative in the case of death, no later than the
180th day following the Participant's date of Disability or death.
12.3 On Account of Retirement. If the Participant terminates
------------------------
employment with the Company or any Affiliate on account of Retirement, then any
unvested Options held by the Affiliate will be deemed vested on the date of such
termination of employment. Any exercisable Options may be exercised in whole or
in part by the Participant no later than the 90th day following the
Participant's date of Retirement.
13. Adjustments and Changes in the Common Stock.
-------------------------------------------
13.1 If there is any change in the Common Stock by reason of any
subdivision or consolidation of Shares, including, a stock dividend, stock
split, reverse stock split, recapitalization, continuation or reclassification,
or any other increase or decrease in the number of Shares effected without
receipt of consideration by the Company, the aggregate number of Shares
available under this Plan, and the number and the price of Shares subject to
outstanding Options will be appropriately adjusted automatically.
13.2 Upon a sale or exchange of all or substantially all of the assets
of the Company, a merger or consolidation in which the Company is not the
surviving corporation, a merger, reorganization or consolidation in which the
Company is the surviving corporation and stockholders of the Company exchange
their stock for securities or property, a liquidation of the Company, or a
similar transaction as determined by the Committee ("Capital Transaction"), this
Plan and each Option issued, whether vested or unvested, shall terminate, unless
such Options are assumed by a successor corporation in a merger or
consolidation, immediately prior to such Capital Transaction; provided, however,
that unless the outstanding Options are assumed by a successor corporation in a
merger or consolidation, subject to terms approved by the Committee, all
Participants will have the right, during
B-4
<PAGE>
the 15 days prior to such Capital Transaction, to exercise all vested
Options. The Company shall, subject to any nondisclosure provisions, attempt to
provide Participants at least 15 days' notice of the Option termination date.
The Committee may (but shall not be obligated to) (a) accelerate the vesting of
any Option, or (b) apply the foregoing provisions, including but not limited to
termination of this Plan and the Options granted pursuant to the Plan, in the
event there is a sale of 51% or more of the stock of the Company in any two-year
period or a transaction similar to a Capital Transaction.
13.3 No right to purchase fractional shares will result from any
adjustment in Options pursuant to this Section 13. In case of any such
adjustment, the Shares subject to the Option will be rounded down to the nearest
whole share.
13.4 Notice of any adjustment will be given by the Company to each
Participant whose Options have been so adjusted and such adjustment (whether or
not such notice is given) will be effective and binding for all purposes of this
Plan.
14. Compliance With Law. No Share will be issued upon exercise of any
-------------------
Option, and the Participant will have no right or claim to such Shares, unless
and until: (a) payment in full as provided in this Plan has been received by the
Company; (b) in the opinion of counsel for the Company, all applicable
requirements of law and of regulatory bodies having jurisdiction over such
issuance and delivery have been fully complied with; and (c) if required by
federal or state law or regulation, the Participant has paid to the Company the
amount, if any, required to be withheld on the amount deemed to be compensation
to the Participant as a result of the exercise of his or her Option, or made
other arrangements satisfactory to the Company, in its sole discretion, to
satisfy applicable income tax withholding requirements.
15. Amendment or Termination of this Plan. This Plan will terminate ten
-------------------------------------
(10) years from the Effective Date or such earlier time as the Board may
determine. The Board may from time to time in its discretion amend or modify
this Plan without the approval of the stockholders of the Company, except as
such approval as may be required under the 1934 Act, the Code or by the national
securities exchange on which the Shares are being traded. Any amendment or
termination, whether in whole or in part, will not affect any Options then
outstanding under this Plan.
16. Securities Law Matters. If the Committee deems it necessary, the
----------------------
Company may require a written investment intent representation by the
Participant and may require that a restrictive legend be affixed to certificates
for Shares. If the Committee determines that the exercise or vesting of, or
delivery of benefits pursuant to, any Option would violate any applicable
provisions of federal or state securities law or the listing requirements of any
national securities exchange on which are listed any of the Company's equity
securities, then the Committee may postpone any such exercise, vesting, or
delivery, as the case may be, but the Company will use its best efforts to cause
such exercise, vesting or delivery to comply with all such provisions at the
earliest practicable date.
17. Registration, Listing, Qualification, Approval of Shares and Options.
--------------------------------------------------------------------
If the Committee determines, in its discretion, that it is necessary or
desirable that the Shares subject to any Option (a) be registered, listed or
qualified on any securities exchange or the Nasdaq Stock Market or under any
applicable law, or (b) be approved by any governmental regulatory body, or (c)
be approved by the stockholders of the Company, as a condition of, or in
connection with, the granting of such Option, or the issuance or purchase of
Shares upon exercise of the Option, the Option may not be exercised in whole or
in part unless such registration, listing, qualification or approval has been
obtained free of any condition not acceptable to the Committee.
18. Nontransferability of Options. No Option granted under this Plan may be
-----------------------------
sold, transferred, pledged, assigned or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution. Further, all
Options granted to the Participant under this Plan shall be exercisable during
his or her lifetime only by such Participant.
19. Nonuniform Determinations. Neither the Committee's nor the Board's
-------------------------
determinations under this Plan need be uniform and may be made by the Committee
or the Board selectively among persons who receive, or are eligible to receive,
Options (whether or not such persons are similarly situated).
20. Relationship Between the Parties.
--------------------------------
20.1 This Plan will not be deemed to constitute a contract of
employment between the Company or any Affiliate and any Participant, nor will
any provision of this Plan be interpreted to restrict the right of the Company
or any Affiliate to discharge any Participant or restrict the right of any
Participant to terminate his or her employment.
20.2 No Participant or other person will have any claim or right to be
granted an Option under the Plan, except as expressly provided in this Plan.
B-5
<PAGE>
20.3 Neither the Participant, the Participant's legal representative,
nor any person who acquires the right to exercise an Option by reason of the
Participant's death will be, or have any of the rights or privileges of, a
stockholder of the Company in respect of any Share receivable upon the exercise
of any Option granted under this Plan, in whole or in part, unless and until
certificates for such Shares will have been issued.
21. Accounting. All accounting issues arising due to the existence of this
----------
Plan will be determined in accordance with generally accepted accounting
principles.
22. Governing Law. The validity, construction, interpretation,
-------------
administration and effect of this Plan and any rules, regulations and actions
relating to this Plan will be governed by and construed exclusively in
accordance with the laws of the State of Delaware.
23. Severability. If all or any part of this Plan is declared by any court,
------------
governmental authority or arbitrator to be unlawful or invalid, such
unlawfulness or invalidity will not serve to invalidate any portion of this Plan
not declared to be unlawful or invalid. Any Section or part of a Section so
declared to be unlawful or invalid will, if possible, be construed in a manner
which will give effect to the terms of such Section or part of a Section to the
fullest extent possible while remaining lawful and valid.
24. Notices. All notices and demands of any kind which the Committee, any
-------
Participant, or other person may be required or desires to give under the terms
of this Plan will be in writing and shall be personally delivered or sent by
mail, postage prepaid, addressed to the Company at its principal place of
business and to the Participant at the address shown in the Option grant
agreement or at any other address the Participant indicates by notice to the
Company. Delivery by mail will be deemed made at the expiration of the third day
after the day of mailing, except for notice of the exercise of an Option and
payment of the Exercise Price, both of which must be actually received by the
Company.
OREGON STEEL MILLS, INC.,
a Delaware corporation
/s/ Joe E. Corvin
--------------------------------
Joe E. Corvin, President and CEO
B-6
EXHIBIT C
OREGON STEEL MILLS, INC.
2000 NONQUALIFIED STOCK OPTION PLAN
NOTICE OF EXERCISE
------------------
TO: Oregon Steel Mills, Inc. (the "Company")
Subject: Notice of Intention to Exercise Stock Option
This is official notice that the undersigned ("Optionee") intends to
exercise Optionee's option to purchase shares of the Company's
-----------
Common Stock, under and pursuant to the Company's 2000 Nonqualified Stock Option
Plan and Stock Option Agreement dated , as follows:
---------
Original Date of Grant:
-----------------------------------
Exercise Date:
-----------------------------------
Number of Shares to be Purchased:
-----------------------------------
Purchase Price per Share:
-----------------------------------
Total Purchase Price:
-----------------------------------
Method of Payment:
-----------------------------------
Social Security No.:
-----------------------------------
The Shares should be issued as follows:
Name:
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Address:
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------------------------------
Signed:
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Date:
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1
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