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EXHIBIT 10.24
STEEL DYNAMICS, INC.
2003 EXECUTIVE INCENTIVE COMPENSATION PLAN
1. Purpose. The purpose of the Steel Dynamics, Inc. 2003
Executive
Incentive Compensation Plan (the "Plan") is
to provide annual performance-based
incentive compensation to executives, based
on the financial performance
criteria described in this Plan.
This Plan supersedes and replaces the Steel Dynamics, Inc. Amended
and
Restated Officer and Manager Cash and Stock
Bonus Plan (the "Old Plan"),
originally adopted, with stockholder
approval, October 28, 1996 and amended,
with stockholder approval, effective
January 1, 2000, except that all Stock
bonus awards previously made under the Old
Plan and not yet fully vested shall
continue to be governed by the terms of the
Old Plan.
Under the Old Plan, 450,000 shares of Stock were authorized for
issuance; and, from inception of the Old
Plan to date, a total of 224,835 shares
were issued, of which 95,902 shares have
not yet vested. Accordingly, the
balance of 225,165 shares, together with
any additional vesting forfeitures,
remaining unissued under the Old Plan will
be available for issuance under this
Plan, as part of and not in addition to the
total number of shares authorized
under Section 3.1 of this Plan.
2. Effective Date and Term of Plan. The Effective Date of the Plan
is
January 1, 2003, subject to stockholder
approval. The Plan shall terminate on
February 28, 2008, unless extended, subject
to stockholder approval, or earlier
terminated by the Board.
3.
Shares of Stock Subject to the Plan.
3.1. The total number of shares of Stock of the Company
reserved and available for issuance and distribution pursuant to
the
Plan shall not exceed, in the aggregate, 750,000 shares of the
authorized Stock of the Company, including the 225,165 or more
unused
shares held over from the Old Plan, subject to adjustment as
described
below.
3.2. Stock which may be issued under the Plan may be either
authorized but unissued shares or shares of issued Stock held in
the
Company's treasury, or both, at the discretion of the
Committee.
Whenever any Stock is forfeited under the Plan, the shares
forfeited
shall revert to authorized but unissued shares and may again be
reissued hereunder.
3.3. In the event of any stock dividend, stock split,
combination or exchange of shares, recapitalization or other change
in
the capital structure of the Company, corporate separation or
division
(including, but not limited to, split-up, split-off, spin-off
or
distribution to Company stockholders, other than a normal cash
dividend), sale by the Company of all or a substantial portion of
its
assets, rights offering, merger, consolidation, reorganization
or
partial or
complete liquidation, or any other corporate transaction or
event having an effect similar to any of the foregoing, the
aggregate
number of shares reserved for issuance under the Plan, as the
Committee
shall deem necessary or appropriate to reflect equitably the
effects of
such changes, shall be appropriately adjusted, or new shares shall
be
issued, as determined by the Committee in its discretion.
4. Definitions. As used in this Plan, the following terms shall
have
the following meanings (such meanings to be
equally applicable to both the
singular and plural forms of the terms
defined):
"Adjusted Pre-Tax Net Income" means, for any Year,
consolidated net income of the Company, before taxes,
extraordinary
items and bonuses payable to Participants under this Plan, as
determined by the Company; provided, however, that, to the
extent
reasonably determinable, the effect upon Adjusted Pre-Tax Net
Income of
any start-up expenses associated with significant capital
expenditures,
for a period not to exceed twelve (12) months following start-up,
shall
be excluded from and not taken into account in determining such
Adjusted Pre-Tax
Net Income.
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2003 Executive Incentive Compensation
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"Average Divisional ROA Assets" for a division means the sum
of the dollar amounts
of total divisional assets employed by that
division at the end of each month during the Year and during the
last
month of the prior year, adjusted by subtracting (a) the book value
of
assets classified as construction-in-progress, (b) the book value
of
assets placed in service during the Year, and (c) fifty percent
(50%)
of the book value of assets placed in service during the prior
year,
and dividing the resulting amount by the number of months of the
Year
plus one.
"Base Salary" means, with respect to a Participant, the
regular annual salary approved as "base salary" by the Committee
and
paid during a Year for services rendered, excluding any cash or
stock
bonus payments (whether paid under this Plan or otherwise) or
severance
pay.
"Board" means the Board of Directors of the Company.
"Bonus Pool" means, for any Year, an amount determined by
multiplying Adjusted Pre-Tax Net Income, minus an amount equal to
ten
percent (10%) of "Average Stockholders Equity," as determined by
the
Company, by a percentage amount, determined annually by the
Committee
no later than ninety (90) days after the commencement of the Year
for
which incentive compensation hereunder may be paid, that shall be
no
less than five percent (5%) nor more than six and one-half percent
(6
1/2%).
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Committee" means a committee of the Board, as contemplated by
Section 6.
"Company" means Steel Dynamics, Inc., an Indiana corporation,
and its subsidiaries.
"Corporate Executive Officer" means those persons whose
primary responsibilities are company-wide, consisting initially of
(a)
the Company's President and Chief Executive Officer, (b) the
Company's
Chief Financial Officer, and (c) such other persons, if any, who
may be
from time to time designated as a Corporate Executive Officer by
the
Committee, for purposes of this Plan, no later than ninety (90)
days
after the commencement of the Year for which incentive
compensation
hereunder may be paid. Unless changed by the Committee within
the
foregoing period, with respect to any Year, an officer's
designation
for Plan purposes, once made, shall continue from year to year.
"Corporate Officer" means those persons whose primary
responsibilities are company-wide, consisting initially of (a)
the
Company's Vice President of Sales and Marketing and (b) such
other
persons, if any, who may be from time to time designated as a
Corporate
Officer by the Committee, for purposes of this Plan, no later
than
ninety (90) days after the commencement of the Year for which
incentive
compensation hereunder may be paid. Unless changed by the
Committee
within the foregoing period, with respect to any Year, an
officer's
designation for Plan purposes, once made, shall continue from year
to
year.
"Divisional Executive Officer" means those persons who have
both company-wide and direct divisional responsibilities,
consisting
initially of (a) the Vice President and General Manager of the
Company's Butler, Indiana Flat Rolled Division, (b) the Vice
President
and General Manager of the Company's Columbia City, Indiana
Structural
and Rail Division, and (c) such other persons, if any, who may be
from
time to time designated as a Divisional Executive Officer by
the
Committee, for purposes of this Plan, no later than ninety (90)
days
after the commencement of the Year for which incentive
compensation
hereunder may be paid. Unless changed by the Committee within
the
foregoing period, with respect to any Year, an officer's
designation
for Plan purposes, once made, shall continue from year to year.
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"Divisional Officer" means those persons who have both
company-wide and direct divisional responsibilities, consisting
initially of (a) the general manager of the Company's
Pittsboro,
Indiana Bar Products Division, (b) the president of the Company's
New
Millennium Building Systems subsidiary, and (c) such other persons,
if
any, who may be from time to time designated as a Divisional
Officer by
the Committee, for purposes of this Plan, no later than ninety
(90)
days after the commencement of the Year for which incentive
compensation hereunder may be paid. Unless changed by the
Committee
within the foregoing period, with respect to any Year, an
officer's
designation for Plan purposes, once made, shall continue from year
to
year.
"Divisional Return on Assets" for a division means a
percentage established by adding (a) the division's net income for
the
Year, as determined for corporate consolidation purposes, (b)
the
amount of certain corporate expenses allocated to that division,
and
(c) the amount of incentive bonus compensation expenses associated
with
this Plan, and then dividing that sum by the Average Divisional
ROA
Assets.
"Effective Date" has the meaning assigned to such term in
Section 2.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
"Fair Market Value" means, as of any date, the value of the
Stock determined as follows: if the Stock is listed on any
established
stock exchange or a national market system, including without
limitation the NASDAQ National Market of the National Association
of
Securities Dealers, Inc. Automated Quotation (NASDAQ) System, the
Fair
Market Value of a share of Stock shall be the closing sales price
for
such Stock (or the closing bid, if no sales were reported) as
quoted on
such system or exchange (or the exchange with the greatest volume
of
trading in the Stock) on the last market trading date prior to the
date
of determination, as reported by Dow Jones, in the Wall Street
Journal
or by such other source as the Committee deems reliable.
"Maximum ROA Target" means a Return on Assets percentage, by
division,
established by the Committee, which shall be no less than
twenty-five percent (25%) nor more than thirty-five percent
(35%).
"Minimum ROA Target" means a Return on Assets percentage, by
division, established by the Committee, which shall be no less
than
four percent (4%) nor more than six percent (6%).
"Participant" means those Corporate Executive Officers,
Divisional Executive Officers, Corporate Officers and
Divisional
Officers who, either as defined hereunder or by Committee
designation,
are designated or selected from time to time to be Participants
under
this Plan.
"Participant's Adjusted Base Salary", as applied within the
Bonus Pool component of this Plan, (a) for purposes of either or
both
of the cash portions of the bonuses described in Sections 5.1 and
5.2,
means (i) with respect to any Corporate Executive Officer, two
and
one-half (2 1/2) times his Base Salary, (ii) with respect to a
Divisional Executive Officer, half of his Base Salary multiplied by
two
and one-half (2 1/2), (iii) with respect to any Corporate Officer,
one
and one-half (1 1/2) times his Base Salary, and (iv) with respect
to
any Divisional Officer twenty-five percent (25%) of his Base
Salary
multiplied by one and one-half (1 1/2); and (b) for purposes of
the
stock portions of the bonuses described in Sections 5.1 and 5.2,
means
(i) with respect to any Corporate Executive Officer, his Base
Salary,
(ii) with respect to a Divisional Executive Officer fifty percent
(50%)
of this Base Salary, (iii) with respect to any Corporate
Officer,
seventy-five
percent (75%) of his Base Salary, and (iv) with respect to
any Divisional Officer eighteen and three-quarters percent (18.75%)
of
his Base Salary.
"Participant's Bonus Pool Percentage" means, in any Year with
respect to a Participant, a fraction, the numerator of which is
equal
to the Participant's Adjusted Base Salary and the denominator of
which
is equal to the sum of all of the Participants' Adjusted Base
Salaries.
"Plan" means the Steel Dynamics, Inc. 2003 Executive Incentive
Compensation Plan, or as it may be further amended from time to
time.
"Remaining Bonus Pool" means the excess of the Bonus Pool over
the sum of the aggregate cash bonus amounts payable pursuant to
Sections 5.1.1.1 and 5.1.2.1.
"Restricted Stock" means Stock issued pursuant to the Plan
that is not yet vested as contemplated by Section 8.
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2003 Executive Incentive Compensation Plan
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"Retirement" means voluntary retirement by a Participant who
is at least 60 years old.
"Stock" means the $0.01 par value common stock of the Company.
"Vested Shares" has the meaning assigned to such term in
Section 8.
"Year" means the Company's fiscal year, for which incentive
compensation may be payable hereunder.
5. Payment of Incentive Compensation. Subject to the terms,
conditions
and limitations set forth in this Plan,
each Year Participants who are Corporate
Executive Officers or Corporate Officers
may be entitled to receive a cash and a
stock bonus under Section 5.1; and
Participants who are Divisional Executive
Officers or Divisional Officers may be
entitled to receive a cash and a stock
bonus under both Sections 5.1 and 5.2.
5.1. Incentive Compensation for Corporate Executive Officers
and Corporate Officers. Each Participant who is a Corporate
Executive
Officer or a Corporate Officer
