<PAGE>
EXHIBIT 10.4
ALLEGHENY TECHNOLOGIES INCORPORATED
KEY EXECUTIVE PERFORMANCE PLAN
EFFECTIVE AS OF JANUARY 1, 2004
AND AS AMENDED FEBRUARY 24, 2005
ARTICLE I. ADOPTION AND PURPOSE OF THE KEY
EXECUTIVE PERFORMANCE PLAN
1.01 ADOPTION. This Key Executive Performance Plan is adopted by
the
Personnel
and Compensation Committee of the Board of Directors as a part
of the
Allegheny Technologies Incorporated executive compensation
program
effective
January 1, 2004. The KEPP Payments, if any, earned under this
Plan are
intended as performance based compensation within the meaning
of
Section
162(m) of the Internal Revenue Code of 1986, as amended, as
incentive
compensation determined solely with reference to attainment in
predetermined levels of Earnings and Operational Goals within the
relevant
Performance Period.
1.02 PURPOSE. The purposes of the KEPP are (i) to direct the
focus
of key
management employees to the achievement of goals deemed
necessary
for the
success of the Corporation, (ii) to assist the Corporation in
retaining
and motivating selected key management employees of the
Corporation and its subsidiaries who will contribute to the success
of the
Corporation and (iii) to reward key management employees for the
overall
success of
the Corporation as determined with reference to predetermined
levels of
Earnings of the Corporation and attainment of Operational
Goals.
The KEPP
is intended to act as an incentive to participating key
management
employees to achieve long-term objectives that will inure to
the
benefit of all stockholders of the Corporation measured in terms
of
achievement of predetermined levels of Earnings of the Corporation
and
attainment
of Operational Goals.
1.03 PLAN DOCUMENT. This KEPP plan document is intended as the
plan
document
as adopted by the Committee, which will govern all Performance
Periods of
the KEPP beginning in or after 2004.
ARTICLE II. DEFINITIONS
For
purposes of this Plan, the capitalized terms set forth below
shall
have the following meanings:
2.01 AWARD means an opportunity to earn a KEPP Payment in a
particular
Performance Period. Each Award shall be denominated in dollars
that can
be earned upon
<PAGE>
attainment of
predetermined Earnings thresholds (Level 1) and the maximum
amount
that may be paid with respect to Operational Goals before the
application of Negative Discretion (Level 2).
2.02 AWARD AGREEMENT means a written agreement between the
Corporation and a Participant or a written acknowledgment from
the
Corporation specifically setting forth the terms and conditions of
a KEPP
Award
granted to a Participant pursuant to Article VI of this Plan.
2.03
BOARD means the Board of Directors of the Corporation.
2.04 CAUSE means a determination by the Committee that a
Participant
has
engaged in conduct that is dishonest or illegal, involves moral
turpitude
or jeopardizes the Corporation's right to operate its business
in the
manner in which it is now operated.
2.05 CHANGE IN CONTROL means any of the events set forth below:
(a) The acquisition in one or more transactions, other than
from the
Corporation, by any individual, entity or group (within the
meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act) of beneficial
ownership
(within the meaning of Rule 13d-3 promulgated under the
Exchange
Act) of a
number of Corporation Voting Securities in excess of 25% of the
Corporation Voting Securities unless such acquisition has been
approved by
the Board;
or
(b) Any election has occurred of persons to the Board that
causes
two-thirds of the Board to consist of persons other than (i)
persons
who were members of the Board on January 1, 2001 and (ii)
persons
who were
nominated for election as members of the Board at a time when
two-thirds
of the Board consisted of persons who were members of the Board
on January
1, 2001; provided, however, that any person nominated for
election
by the Board at a time when at least two-thirds of the members
of
the Board
were persons described in clauses (i) and/or (ii) or by persons
who were
themselves nominated by such Board shall, for this purpose, be
deemed to
have been nominated by a Board composed of persons described in
clause
(i); or
(c) Approval by the stockholders of the Corporation of a
reorganization, merger or consolidation, unless, following such
reorganization, merger or consolidation, all or substantially all
of the
individuals and entities who were the respective beneficial owners
of the
Outstanding Stock and Corporation Voting Securities immediately
prior to
such
reorganization, merger or consolidation, following such
reorganization, merger or consolidation beneficially own, directly
or
indirectly, more than 60% of, respectively, the then outstanding
shares of
common
stock and the combined voting power of the then outstanding
voting
securities
entitled to vote generally in the election of directors or
trustees,
as the case may be, of the entity resulting from such
reorganization, merger or consolidation in substantially the
same
proportion
as their ownership of the Outstanding Stock and Corporation
Voting
Securities immediately prior to such reorganization, merger or
consolidation, as the case may be; or
2
<PAGE>
(d) Approval by the stockholders of the Corporation of (i) a
complete
liquidation or dissolution of the Corporation or (ii) a sale or
other
disposition of all or substantially all the assets of the
Corporation.
2.06 COMMITTEE means the Personnel and Compensation Committee of
the
Board.
2.07 CORPORATION means Allegheny Technologies Incorporated, a
Delaware
corporation, and its successors.
2.08 CORPORATION VOTING SECURITIES means the combined voting
power
of all
outstanding voting securities of the Corporation entitled to
vote
generally
in the election of the Board.
2.09 DATE OF AWARD means the date as of which an Award is granted
in
accordance
with Article VI of this Plan.
2.10 DISABILITY means any physical or mental injury or disease of
a
permanent
nature which renders a Participant incapable of meeting the
requirements of
the employment performed by such Participant immediately
prior to
the commencement of such disability. The determination of
whether
a
Participant is disabled shall be made by the Committee in its sole
and
absolute
discretion. Notwithstanding the foregoing, if a Participant's
employment
by the Corporation or an applicable subsidiary terminates by
reason of
a disability, as defined in an Employment Agreement between
such
Participant and the Corporation or an applicable subsidiary,
such
Participant shall be deemed to be disabled for purposes of the
KEPP.
2.11 EFFECTIVE DATE means January 1, 2004 and, for the amendment
for
grants
made in or after 2005, February 24, 2005.
2.12 EARNINGS
means the earnings of the Corporation determined in
accordance
with generally accepted accounting principles, provided,
however,
for the 2005 through 2007 Performance Period, Earnings shall be
expressed
in terms of income before taxes.
2.13 EXCHANGE ACT means the Securities Exchange Act of 1934, as
amended.
2.14 KEPP PAYMENT means the amount actually earned by a
Participant
in a
particular Performance Period. Each KEPP Payment shall be the sum
of
the
amounts earned by a Participant during a Performance Period as
Level I
and Level
2 achievement.
2.15 LEVEL 1 means that portion of an Award that may be earned
based
on
attainment of Earnings.
2.16 LEVEL 2 means that portion of an Award that may be earned,
after
application of Negative Discretion by the Committee, based on
attainment
of Operational
3
<PAGE>
Goals. The
Level 2 portion of any Award shall be denominated in the
maximum
amount that may be earned with respect to Operational Goals
prior
to the
application of Negative Discretion.
2.16 NEGATIVE DISCRETION means the power of the Committee to be
exerci
