EXHIBIT 10.22
AK STEEL HOLDING
CORPORATION
STOCK INCENTIVE
PLAN
(as amended and restated as of
January 20, 2005)
Article 1. Amendment and
Restatement, Purpose, and Duration.
1.1 Amendment and Restatement of
the Plan. AK Steel
Holding Corporation, a Delaware corporation (the
“Company”), previously established an incentive
compensation plan known as the “AK Steel Holding Corporation
Stock Incentive Plan” (the “Plan”). On
January 20, 2005, the Board of Directors of the Company
adopted this amendment and restatement of the Plan, subject to the
approval of the Company’s shareholders. The Plan permits the
grant of Nonqualified Stock Options, awards of Restricted Stock,
and awards of Performance Shares.
1.2 Purpose of the
Plan. The purpose of the
Plan is to promote the success and enhance the value of the Company
by linking the personal interests of directors, executive officers
and key employees of the Company to those of the Company’s
shareholders, and by providing these individuals with an incentive
for outstanding performance. The Plan is further intended to
enhance the Company’s ability to motivate, attract, and
retain the services of these individuals upon whose judgment,
interest, and special effort the successful conduct of its
operation is largely dependent.
1.3 Duration of the
Plan. This amendment and
restatement of the Plan shall become effective on the date it is
approved by the Company’s shareholders, and shall remain in
effect until all Shares subject to it shall have been purchased or
acquired or are no longer available for Awards according to the
Plan’s provisions, subject to the right of the Board to
terminate the Plan at any time pursuant to Article 11 herein. In no
event may an Award be granted under the Plan on or after
December 31, 2014. Termination of the Plan shall not affect
the rights of any person under an outstanding Award Agreement
unless otherwise specifically provided in such Award
Agreement.
Article 2.
Definitions. Whenever
used in the Plan, the following terms shall have the meanings set
forth below and, when the meaning is intended, the initial letter
of the word is capitalized:
(a) “Award”
includes, without limitation, Option Awards, Restricted Stock
Awards, or Performance Share Awards that are valued in whole or in
part by reference to, or are otherwise based on, the
Company’s stock, performance goals or other factors, each on
a stand alone or combination basis, as described in or granted
under this Plan.
(b) “Award
Agreement” means the agreement or other writing that sets
forth the terms and conditions of each Award, including any
amendment or modification thereof. A Participant is bound by the
terms of an Award Agreement and this Plan by reason of accepting
the benefits of the Award.
(c) “Beneficial
Owner” shall have the meaning ascribed to such term in
Rule l3d-3 of the General Rules and Regulations under the Exchange
Act.
(d) “Beneficiary”
means the person or persons named by a Participant to succeed to
the Participant’s rights under any then unexpired Award
Agreements. Each such designation shall: (i) revoke all prior
designations by the same Participant; (ii) be in a form
acceptable to the Committee; and (iii) be effective only when
delivered to the Committee by the Participant in writing and during
the Participant’s lifetime. No beneficiary shall be entitled
to any notice of any change in a designation of beneficiary. In the
absence of any such designation, the Participant’s estate
shall be the beneficiary.
(e) “Board” means
the Board of Directors of the Company.
(f) “Cause”
means: (i) conviction of, or entering a plea of guilty or nolo
contendere to, a misdemeanor involving moral turpitude or a felony;
(ii) engagement in fraud, misappropriation or embezzlement
with respect to the Company or any subsidiary or affiliate thereof;
(iii) willful failure, gross negligence or gross misconduct in
the performance of assigned duties for the Company or any
subsidiary or affiliate thereof; and/or (iv) breach of a
fiduciary duty to the Company or any subsidiary or affiliate
thereof.
(g) “Change of
Control” shall be deemed to have occurred if:
(i) any person (other than a trustee
or other fiduciary holding securities under an employee benefit
plan in which employees of the Company participate) becomes the
Beneficial Owner, directly or indirectly, of securities of the
Company representing forty percent (40%) or more of the
combined voting power of the Company’s then outstanding
voting securities; or
(ii) during any period of two
(2) consecutive years individuals who at the beginning of such
period constitute the Board, including for this purpose any new
Director of the Company (other than a Director designated by a
person who has entered into an agreement with the Company to effect
a transaction described in clauses (i) or (iii) of this
Subsection (g)) whose election by the Board or nomination for
election by the shareholders of the Company was approved by a vote
of at least two-thirds (2/3) of the Directors then still in
office who either were Directors at the beginning of the period or
whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority of the
Board; or
(iii) the shareholders of the
Company approve a merger or consolidation of the Company with any
other corporation (other than a merger or consolidation which would
result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities
of the surviving entity) at least fifty percent (50%) of the
combined voting power of the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation) or the shareholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the
Company’s assets.
(h) “Code” means
the Internal Revenue Code of 1986, as amended from time to
time.
(i) “Committee”
means the Compensation Committee of the Board, or such other
committee designated by the Board to administer this Plan. The
Committee shall consist of not less than two members of the Board
who shall be appointed from time to time by, and shall serve at the
discretion of, the Board. The Committee shall be comprised solely
of Directors who are: (i) “independent directors”
as defined in the rules and regulations of the New York Stock
Exchange; (ii) “non-employee directors” as defined
in Rule 16b-3 promulgated under the Exchange Act; and
(iii) “outside directors” within the meaning of
Section 162(m) of the Code and related regulations. The
references herein to specific rules, regulations, and statutes
shall include any successor provisions thereof.
(j) “Company”
means AK Steel Holding Corporation, a Delaware corporation, or any
successor thereto, as provided in Article 14 herein.
(k) “Covered
Employee” means any Participant who is or may be a
“covered employee” within the meaning of
Section 162(m)(3) of the Code.
(l) “Director”
means any individual who is a member of the Board and who is not an
Employee.
(m) “Disability”
means a physical or mental condition which, in the judgment of the
Committee, renders a Director unable to serve or an Employee unable
to perform the duties of his position with the Company or, in the
case of an Employee, the duties of another available position with
the Company for which the Employee is suited by education,
background and training. Any Employee found to be qualified for
disability benefits under AK Steel Holding Corporation’s long
term disability plan or by the Federal Social Security
Administration will be considered to be disabled under this Plan,
but qualification for such benefits shall not be required as
evidence of disability hereunder.
(n) “Employee”
means any common law employee of the Company or any subsidiary or
affiliate thereof, including AK Steel Corporation. A Director is
not an Employee solely by reason of his position as a Director and,
unless otherwise employed by the Company, shall not be considered
to be an Employee under this Plan.
(o) “Exchange
Act” means the Securities Exchange Act of 1934, as
amended from time to time, or any successor act thereto.
(p) “Fair Market
Value” shall mean:
(i) if the Shares are traded on an
established United States national stock exchange or in the United
States over-the-counter market with prices reported on the NASDAQ,
the average of the highest and lowest sales prices for Shares on
the relevant date (or, if there were no sales of Shares on such
date, the weighted average of the mean between the highest and
lowest sale prices for Shares on the nearest preceding trading day
on which there were sales of Shares); and
(ii) if the Shares are not traded as
described in clause (i), the fair market value of such Shares on
the relevant date, as determined in good faith by the
Board.
(q) “Insider”
shall mean an Employee who is, on the relevant date, an executive
officer or ten percent (10%) Beneficial Owner of the Company,
as defined under Section 16 of the Exchange Act, or a
Director.
(r) “Nonqualified Stock
Option” or “Option” means an option to
purchase Shares from the Company at a price established in an
Option Award Agreement. No incentive stock option within the
meaning of Code Section 422 may be granted under this
Plan.
(s) “Option
Award” means, individually or collectively, a grant under
this Plan of a Nonqualified Stock Option.
(t) “Option Award
Agreement” means an agreement setting forth the terms and
provisions applicable to an Option Award granted to a Participant
under this Plan.
(u) “Option
Price” means the price at which a Share may be purchased
by a Participant under the terms of an Option Award
Agreement.
(v) “Par Value”
shall mean the designated par value of one Share.
(w) “Participant”
means any Director or Employee who possesses an unexpired Award
granted under the Plan.
(x) “Performance
Share” means Shares (or units representing the right to
receive Shares) granted to a Participant subject to attainment of
certain performance criteria and objectives in accordance with the
terms of the Plan.
(y) “Performance Share
Award” means individually or collectively, a grant under
this Plan of a Performance Share.
(z) “Performance Share
Award Agreement” means an agreement setting forth the
terms and provisions applicable to a Performance Share Award under
this Plan.
(aa) “Plan” means
the AK Steel Holding Corporation Stock Incentive Plan as set in
this document, and if amended at any time, then as so
amended.
(bb) “Restricted
Stock” means Shares granted to a Participant subject to
certain restrictions on the Participant’s right to sell,
transfer, assign, pledge, encumber or otherwise alienate or
hypothecate the Shares except in accordance with the terms of this
Plan.
(cc) “Restricted Stock
Award” means, individually or collectively, a grant under
this Plan of Shares of Restricted Stock.
(dd) “Restricted Stock
Award Agreement” means an agreement setting forth the
terms and provisions applicable to a Restricted Stock Award under
this Plan.
(ee) “Retirement”
shall mean termination of employment with the Company or any
affiliate of the Company with eligibility to immediately commence
to receive a pension under the Company’s noncontributory
defined benefit pension plan as in effect on the Employee’s
termination date. For a Participant who is not participating in
such plan, Retirement shall mean any termination of employment with
the Company which would have entitled such Participant to be
eligible to immediately commence to receive a pension under the
Company’s non-contributory defined benefit pension plan had
the Participant been a participant.
(ff) “Shares”
means the shares of voting common stock of the Company.
Article 3.
Administration.
3.1 The Committee.
The Plan shall be administered by
the Committee. The Committee may employ such legal or other
counsel, consultants and agents as it may deem desirable for the
administration of the Plan and may rely upon any opinion or
computation received from any such counsel, consultant or agent.
Expenses incurred by the Committee in the engagement of such
counsel, consultant or agent shall be paid by the Company. No
member or former member of the Board or the Committee shall be
liable for any action or determination made in good faith with
respect to the Plan or any Award granted hereunder.
3.2 Authority of the
Committee. The Committee
shall have full power, subject to the provisions of this Plan,
except as limited by law or by the Articles of Incorporation or
Bylaws of the Company: (a) to determine the size and types of
Awards (except as to Awards to Directors which shall be limited to
the size and shall be subject to the conditions expressly permitted
by this Plan); (b) to determine the terms and conditions of
each Award Agreement in a manner consistent with the Plan;
(c) to construe and interpret the Plan and any agreement or
instrument entered into under the Plan; (d) to establish,
amend, or waive rules and regulations for the Plan’s
administration; and, (e) subject to the provisions of Article
11 herein, to amend the terms and conditions of any outstanding
Award Agreement to the extent such terms and conditions are within
the discretion of the Committee as provided in the Plan. Further,
the Committee shall make all other determinations which may be
necessary or advisable for the administration of the Plan. The
Committee may delegate its authority hereunder to the extent
permitted by law. In no event shall a Director who is a Participant
vote in any matter related solely to such Director’s Award
under this Plan.
3.3 Decisions Binding.
All determinations and decisions
made by the Committee pursuant to the provisions of the Plan and
all related orders or resolutions of the Board shall be final,
conclusive and binding on all persons, including the Company, its
shareholders, Directors, Employees, Participants, and their
estates, beneficiaries or assignees. In all cases, Awards to
Directors shall be subject to the same terms, conditions and
interpretations applicable generally to Awards to non-Director
Participants.
3.4 Arbitration.
Each Participant who is granted an
Award hereunder agrees as a condition of the Award to submit to
binding arbitration any dispute regarding the Plan or any Award
made under the Plan, including by way of illustration and not
limitation, any decision of the Committee or any action of the
Company respecting the Plan. Such arbitration shall be held in
accordance with the rules of the American Arbitration Association
before an arbitrator selected by the Company and acceptable to the
Participant. If the Participant objects to the appointment of the
arbitrator selected by the Company, and the Company does not
appoint an arbitrator acceptable to the Participant, then the
Company and the Participant shall each select an arbitrator and
those two arbitrators shall collectively appoint a third arbitrator
who shall alone hear and resolve the dispute. The Company and the
Participant shall share equally the cost of arbitration. No Company
agreement of indemnity, whether under the Articles of
Incorporation, the By-Laws or otherwise, and no insurance purchased
by the Company shall apply to pay or reimburse any
Participant’s costs of arbitration.
Article 4. Shares Subject to Grant Under the
Plan.
4.1 Number of Shares.
Subject to adjustment as provided in
this Section and in Section 4.3, an aggregate of 16,000,000
Shares shall be available for the grant of Option Awards,
Restricted Stock Awards, and Performance Share Awards under the
Plan (hereinafter called the “Share Pool”); provided,
however, that no Employee may be granted Awards under the Plan in
any calendar year with respect to more than 600,000 Shares. The
Committee, in its sole discretion, shall determine the appropriate
division of the Share Pool as between Option Awards, Restricted
Stock Awards, and Performance Share Awards. Shares issued pursuant
to any Award may be either authorized and previously unissued
Shares or reacquired Shares.
The following rules will apply for
purposes of the determination of the number of Shares available for
grant under the Plan:
(a) the grant of an Award to an
Employee shall reduce the Shares available in the Share Pool for
grant under the Plan by the number of Shares subject to the Award;
and
(b) to the extent that an Option is
settled in cash rather than by the delivery of Shares, the Share
Pool shall be reduced by the number of Shares represented by the
cash settlement of the Option (subject to the limitation set forth
in Section 4.2 herein).
4.2 Lapsed Awards.
If any Award granted under this Plan
is canceled, terminates, expires or lapses for any reason, any
Shares then subject to such Award again shall be available for
grant under the Plan and shall return to the Share Pool.
4.3 Adjustments in Authorized
Shares. In the event of
any merger, reorganization, consolidation, recapitalization,
separation, liquidation, stock dividend, split-up, Share
combination, or other change in the corporate structure of the
Company affecting the Shares, an appropriate adjustment shall be
made in the number and class of Shares which may be delivered under
the Plan, in the number and class of Shares that may be issued to
an Employee with respect to Awards in any given period, and in the
number and class of and/or price of Shares subject to any then
unexercised and outstanding Awards, as determined to be appropriate
and equitable by the Committee, in its sole discretion, to prevent
dilution or enlargement of rights. The number of Shares subject to
any Award shall always be a whole number.
4.4 Rights as a
Shareholder. No person
shall have any rights as a shareholder with respect to Shares
subject to an Option Award until the date the Company receives full
payment of the Option price, including any sum due for withholding
pursuant to Section 6.6. A person who has Restricted Shares
shall have the rights of an owner of Shares, except to the extent
those rights are expressly limited by then applicable restrictions
on transfer contained in this Plan and the Restricted Stock Award
Agreement. No person shall have any rights as a shareholder with
respect to a Performance Share Award until such date that the
Participant may receive the Shares covered by the Performance Share
Award.
Article 5. Eligibility and
Participation. Directors
and Employees shall be eligible to be Participants in this
Plan.
Article 6. Stock
Options.
6.1 Grant of
Options.
(a) Options may be granted to an
Employee at any time and from time to time as shall be determined
by and in the sole discretion of the Committee, subject to the
provisions of Section 4.1.
(b) Options with respect to ten
thousand (10,000) Shares shall be granted to each Director who
is not employed by the Company on the date of his or her initial
election to the Board, subject to the following terms and
conditions:
(i) the Option Price described in
Section 6.3 shall be the Fair Market Value of the Shares on
the date of grant;
(ii) the Options shall be
exercisable in accordance with Section 6.4 until the tenth
(10th) anniversary of the date of grant;
(iii) any restriction on the right
to exercise the Options in accordance with Section 6.5(a)
shall lapse on the first anniversary of the date of the Option
Award;
(iv) for the purposes of this Plan,
death shall be treated as death while employed under
Section 6.8(a)(i); Disability or Retirement from the Board
shall be subject to the provisions of Sections 6.8(b) and (c);
failure to be reelected shall be an involuntary termination subject
to the terms of Section 6.8(d)(i); and resignation or failure
to stand for reelection shall be deemed to be a voluntary
termination subject to the terms of Section 6.8(e);
and
(v) the limited right of
transferability shall be granted in accordance with
Section 6.7.
Except as above modified or
interpreted, the provisions of this Article 6 shall apply to
Directors in the same manner it applies to others.
6.2 Option Award
Agreement. Each Option
shall be granted pursuant to a written Option Award Agreement,
signed by the appropriate member of the Committee or its designee,
and specifying the terms and conditions applicable to the Options
granted including: the Option Price; the period during which the
Option may be exercised; the number of Shares to which the Option
pertains; the conditions under which the Option is exercisable; and
such other provisions as the Committee may from time to time
determine. The Option Agreement also shall specify that the Option
is intended to be a Nonqualified Stock Option whose grant is
intended not to fall under the provisions of Code
Section 422.
6.3 Option Price.
The Option Price for each Share
subject to purchase shall be determined by the Committee and stated
in the Option Award Agreement but in no event shall be less than
the Fair Market Value of the Shares on the date of grant of the
Award.
6.4 Duration of
Options. Each Option
shall be exercisable for such period as the Committee shall
determine at the time of grant. No Option shall be exercisable
later than the tenth (10th) anniversary of the date of its
grant.
6.5 Exercise of
Options.
(a) Options granted under the Plan
shall be exercisable at such times and be subject to such
restrictions and conditions as the Committee shall in each instance
approve, which need not be the same for each grant or for each
Participant. The Committee may provide, by rule or regulation or in
any Option Award Agreement, that the exercisability of an Option
may be accelerated or extended under various circumstances to a
date not later than the latest expiration date permitted in
accordance with Section 6.4.
(b) Each Option shall be exercisable
only by delivery to the Committee in care of the Secretary of the
Company of a written notice of exercise in such form as the
Committee may require. A notice of exercise shall: specify the
number of shares to
