Attached files
| file | filename |
|---|---|
| 8-K - SCHNITZER STEEL INDUSTRIES, INC. - SCHNITZER STEEL INDUSTRIES, INC. | form8-k_16707.htm |
EXHIBIT 10.1
SCHNITZER
STEEL INDUSTRIES, INC.
EXECUTIVE
ANNUAL BONUS PLAN
1. Purpose. Schnitzer
Steel Industries, Inc. (the “Company”) hereby establishes the Schnitzer Steel
Industries, Inc. Executive Annual Bonus Plan (the “Plan”) with the intent of
qualifying compensation paid under the Plan as “performance-based compensation”
within the meaning of Section 162(m) of the Internal Revenue Code of 1986
(“Section 162(m)”) and the regulations promulgated thereunder. The
Plan shall be interpreted in a manner consistent with the foregoing
intent.
2. Administration. The
Plan shall be administered by the Compensation Committee (the “Committee”) of
the Board of Directors of the Company, which shall be comprised solely of two or
more “outside directors” as defined in regulations promulgated under Section
162(m). The Committee may adopt guidelines to implement and
administer the Plan.
3. Plan
Participants. The participants in the Plan (the
“Participants”) shall be the Chief Executive Officer (the “CEO”) of the Company
and such directors and other executive officers of the Company as may be
designated in writing by the Committee at the time of the establishment of
Performance Goals for any fiscal year. Other executives and employees
of the Company may receive bonuses on terms similar to the terms of bonuses paid
to Participants under the Plan, but those bonuses shall not be covered by the
Plan and, therefore, shall not qualify as performance-based compensation under
Section 162(m).
4. Performance
Goals.
(a) To
make an award under the Plan, the Committee shall, no later than 90 days after
the beginning of a fiscal year of the Company, establish in writing the
objectives (“Performance Goals”) that must be satisfied by the Company or any
subsidiary, division or other unit of the Company (“Business Unit”) during such
year as a condition to the payment or accrual of a cash bonus for each
Participant based on performance in that year. The Committee shall
also establish (i) the amounts, or the formula for determining the amounts, of
cash bonuses to be paid or accrued based on achievement of the Performance
Goals, and (ii) the timing of payment and any other conditions to payment of
such amounts. In establishing any Performance Goals, the Committee
may, in its sole discretion, reserve the right to reduce the resulting cash
bonuses prior to payment on such terms as determined by the
Committee.
(b) The
Performance Goals for each fiscal year shall be one or more targeted levels of
performance with respect to one or more of the following objective measures with
respect to the Company or any Business Unit: economic profit
(adjusted operating income after taxes less a capital charge), net income,
earnings per share, return on equity, return on assets, return on capital,
return on investment, revenues, gross margin, gross margin per ton (or other
unit of weight or volume), operating margin, operating income, operating income
per ton (or other measure of weight or volume), income before income taxes,
earnings before interest and taxes (“EBIT”), earnings before interest, taxes,
depreciation and amortization (“EBITDA”), working capital, inventories,
inventory turns, sales volume, production volume, intake purchase volumes, cash
flows, man hours per ton, conversion costs, safety metrics (including but not
limited
to OSHA Total Incident Rate, Lost Time Rate and Recordable Injuries) or any of
the foregoing before the effect of acquisitions, divestitures, accounting
changes, and restructuring and special charges (determined according to criteria
established by the Committee).
5. Computation of
Bonus. Following the conclusion of any fiscal year, prior to
the payment of any cash bonuses under the Plan with respect to that year, the
Committee shall certify in writing the attainment of the Performance Goals for
the year and the calculation of the bonus amounts. No bonus shall be
paid or accrued if the related Performance Goal is not met.
6. Maximum
Bonus. The maximum cash bonus that may be paid or accrued for
any Participant with respect to performance of the Company in any fiscal year
shall be $6,000,000.
7. Amendment and Termination of
Plan. The Board may at any time amend or terminate the Plan,
except that no amendment will be effective without approval by the Company’s
shareholders if such approval is necessary to qualify amounts payable hereunder
as performance-based compensation under Section 162(m). Unless it is
re-approved by the shareholders, the Plan shall terminate on the date of the
first shareholder meeting that occurs in the fifth year after the year of the
last re-approval by the shareholders. No termination of the Plan
shall affect Performance Goals and related awards established by the Committee
prior to such termination.
8. No Right of Continued
Employment. Nothing in the Plan or any award pursuant to the
Plan shall confer upon any person any right to be continued in the employment of
the Company or any subsidiary.
9. Governing
Law. The Plan shall be construed in accordance with and
governed by the laws of the State of Oregon.
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