EXHIBIT 10.40
STEEL DYNAMICS,
INC.
NON-EMPLOYEE DIRECTOR STOCK
OPTION PLAN
1. PURPOSE. This Non-Qualified Stock
Option Plan, to be known as the Steel Dynamics, Inc.
Non-Employee Director Stock Option Plan (the “Plan”) is
intended to promote the interests of Steel Dynamics, Inc. (the
“Company”) by providing an inducement to attract and
retain the services of qualified persons who are not employees or
officers of the Company to serve as members of its Board of
Directors (the “Board”) and by strengthening the
mutuality of interests between such directors and the
Company’s Stockholders.
2. AVAILABLE SHARES. The total
number of shares of the Company’s $.01 per share par value
Common Stock (the “Common Stock”) for which options may
be granted under this Plan shall not exceed 100,000 shares, subject
to adjustment in accordance with Section 10 of this Plan.
Shares subject to this Plan may be authorized but unissued shares
or shares that were once issued and subsequently reacquired by the
Company. If any options granted under the Plan shall expire,
terminate or be canceled for any reason without having been
exercised in full, the number of unpurchased shares shall again
become available for purposes of the Plan.
3. ADMINISTRATION. This Plan shall
be administered by the Board or by a committee appointed by the
Board (the “Committee”). In the event the Board fails
to appoint or refrains from appointing a Committee, the Board shall
have all power and authority to administer this Plan. In such
event, the word “Committee,” wherever used herein,
shall be deemed to mean the Board. Subject to the provisions of the
Plan, the Committee shall have the power to construe this Plan, to
determine all questions hereunder, to accelerate the vesting or
exercise of an option, and to adopt and amend such rules and
regulations for the administration of this Plan as it may deem
desirable. The Committee may also correct any defect, supply any
omission, amend or conform the Plan to any change in law or
regulation, or reconcile any inconsistency or ambiguity in the Plan
or in any option in such manner and to the extent it shall deem
necessary to carry the Plan into effect as intended. No member of
the Board or the Committee shall be liable for any action or
determination made in good faith with respect to this Plan or any
option granted under it. Any decision, interpretation or other
action made or taken in good faith by the Committee in accordance
with this Plan shall be final, binding and conclusive on the
Company, all members of the Board and Committee, if any, all
optionees, and their respective heirs, executors, administrators,
successors and assigns.
4. AUTOMATIC GRANT OF OPTIONS.
Subject to the availability of shares under this Plan:
(a) each person who is a member of the Board on the day
following the Company’s 2000 Annual Meeting of Stockholders
and who is not an employee or officer of the Company (a
“Non-Employee Director”) and each person who is a
Non-Employee Director on November 15, 2000 (each an
“Initial Grant Date”) shall be automatically granted an
option to purchase Common Stock of the Company on each such Initial
Grant Date equal to the number of whole shares, rounded up from .50
or down from .49, calculated by dividing a grant value of $15,000
on each of the Initial Grant Dates by the fair market value of the
Company’s Common Stock on each such date, and (b) each
person who is a Non-Employee Director on May 15 and on
November 15 (each a “Grant Date”) in each year
beginning on January 1, 2001 during the term of this Plan
shall be automatically granted on each such date a like option to
purchase Common Stock of the Company equal to the number of whole
shares, rounded up or down as previously described, calculated by
dividing a grant value of $15,000, or such other amount, whether
higher or lower, as is specified from time to time for “Grade
3 Supervisors/Professionals” under the Company’s 1996
Incentive Stock Option Plan (or, in lieu thereof, as may be
specified from time to time by the Committee), by the fair market
value of the Company’s Common Stock on each such Grant Date.
The number of shares covered by options granted under this
Section 4 shall be subject to adjustment in accordance with
the provisions of Section 10 of this Plan.
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5. OPTION PRICE. The purchase price
of the stock covered by options granted pursuant to this Plan shall
be 100% of the fair market value of such shares on the day the
option is granted. The option price will be subject to adjustment
in accordance with the provisions of Section 10 of this Plan.
For purposes of this Plan, “fair market value” shall be
determined as of the last trading day for which the prices or
quotes for the Company’s publicly traded stock are available
prior to the date such option is granted and shall mean
(i) the last reported sale price (on that date) of the
Company’s Common Stock on the Nasdaq National Market, if the
Common Stock is traded on that market; or (ii) the average (on
that date) of the high and low prices of the Company’s Common
Stock on the principal national securities exchange on which the
Common Stock is traded if it is in fact traded on such an exchange;
or (iii) the closing bid price (or average of bid prices) last
quoted (on that date) by an established quotation service for
over-the-counter securities, if the Company’s Common Stock is
not reported on the Nasdaq National Market List.
6. PERIOD OF OPTION. Unless sooner
terminated in accordance with the provisions of Section 8 of
this Plan, an option granted hereunder shall expire on the date
which is five (5) years after the date of grant of the
option.
7. VESTING OF SHARES AND
NON-TRANSFERABILITY OF OPTIONS.
(a) VESTING. Options granted
under this Plan shall not be exercisable until they become vested.
Options granted under this Plan shall become fully vested in the
optionee and thus become exercisable six
(6) months after the date of grant.
(b) NON-TRANSFERABILITY. Any
option granted pursuant to this Plan shall not be assignable or
transferable other than by will or the laws of descent and
distribution, pursuant to a valid domestic relations order, or
otherwise in accordance with the terms of the optionee’s
stock option agreement, and shall be exercisable during the
optionee’s lifetime only by him or her and then only in
accordance with the provisions of the Securities Act of 1933 and
the rules promulgated thereunder.
8. TERMINATION OF OPTION
RIGHTS.
(a) If an optionee ceases to be
a director of the Company, for whatever reason, no further grants
of options shall be made to that optionee pursuant to this
Plan.
(b) Subject to the provisions
of Section 8(d) and except as may otherwise
