UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A INFORMATION

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Securities Exchange Act of 1934

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SunCoke Energy, Inc.SUNCOKE ENERGY, INC.

(Name of Registrant as Specified In Its Charter)

 

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LOGO

March 21, 201829, 2021

Dear Stockholder:

You are cordially invited to attend the 20182021 Annual Meeting of Stockholders of SunCoke Energy, Inc., on Thursday, May 3, 201813, 2021 at 9:00 a.m., Central Time. As part of our precautions regarding the ongoing coronavirus (COVID-19) pandemic, and in consideration of the protocols imposed by federal, state and local time,governments, we have adopted a virtual meeting format for our 2021 Annual Meeting. We will provide a live webcast of the meeting at www.meetingcenter.io/290737273, where you will be able to vote your shares and submit questions online by logging in with the Hotel Arista, 2139 CityGate Lane, Naperville, Illinois 60563.control number included on your proxy card or any additional voting instructions accompanying these proxy materials. We recommend that you log into the website a few minutes before the meeting to ensure that you are logged in when the meeting begins.

The following pages contain our notice of annual meeting and proxy statement. Please review this material for information concerning the business to be conducted at the 20182021 Annual Meeting, including the nominees for election as directors.

As we have in the past, we are furnishing our proxy statement and other proxy materials to our stockholders over the Internet and mailing paper copies to stockholders who have requested them. For further details, please refer to the section entitled “About the Annual Meeting” beginning on page 1 of the proxy statement.

Whether or not you plan to attend the 20182021 Annual Meeting, it is important that your shares be represented. Please vote via telephone, the Internet, proxy card, or voter instruction form.

Thank you for your continued support of SunCoke Energy.

 

Sincerely,

LOGO

Michael G. Rippey

President and Chief Executive Officer

SunCoke Energy, Inc. | 1011 Warrenville Road | Suite 600 | Lisle, Illinois 60532 | tel (630) 824-1000 www.suncoke.com


LOGO

Notice of Annual Meeting of Stockholders

to be held on May 3, 201813, 2021

The 20182021 Annual Meeting of Stockholders of SunCoke Energy, Inc. will(the “2021 Annual Meeting”) is scheduled to be held on Thursday, May 3, 201813, 2021 at 9:00 a.m., local time,Central Time, at the Hotel Arista, 2139 CityGate Lane, Naperville, Illinois 60563,www.meetingcenter.io/290737273, for the following purposes:

 

 1.

To elect 2two directors, Mr. Alvin BledsoeRalph M. Della Ratta, Jr. and Ms. Susan R. Landahl, to the class of directors whose term expires in 2021;at the 2024 annual meeting of stockholders;

 

 2.

To approve an amendmentvote on amendments to the SunCoke Energy, Inc. Long-Term Performance Enhancement PlanCompany’s Amended and Restated Certificate of Incorporation and its Amended and Restated By-laws to increaseprovide for the numberdeclassification of shares of SunCoke’s common stock, par value $0.01, authorized for issuance under such Plan by 1,500,000 shares, and to make certain other changes reflected in the amendment, as more specifically described in the attached proxy statement;Board;

 

 3.

To consider anhold a non-binding advisory vote to approveon the 2018 compensation of SunCoke’sthe Company’s named executive officers, as disclosed in the attached proxy statement;officers; and

 

 4.

To consider an advisory vote to approve the frequency of future advisory votes on executive compensation;

5.

To ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2018; and2021.

Stockholders also will transact such other business as may properly come before the 2021 Annual Meeting or any adjournment or postponement thereof.

6.

To transact such other business as may properly come before the 2018 Annual Meeting or any adjournment or postponement thereof.

All of our stockholders are cordially invited to attend, although only holders of record of SunCoke Energy Common Stock, par value $0.01 per share, at the close of business on March 16, 2021, (the “Record Date”) are entitled to vote at the 2021 Annual Meeting. You may vote at the 20182021 Annual Meeting if you were a stockholder of record at the close of business on March 7, 2018.the Record Date. To ensure that your vote is properly recorded, please vote as soon as possible, even if you plan to attend the 20182021 Annual Meeting in person.Meeting. Most stockholders have three options for submitting their vote: (1) via telephone, (2) over the Internet, or (3) by mail. You still may still vote in personlive if you attend the 20182021 Annual Meeting. For further details about voting, please refer to the section entitled “About the Annual Meeting” beginning on page 1 of the proxy statement.

If your shares are held in “street name” in a stock brokerage account, or by a bank or other nominee, you must provide your broker with instructions on how to vote your shares in order for your shares to be voted on important matters presented at the 20182021 Annual Meeting. If you do not instruct your broker on how to vote inwith regard to the election of directors, the approval of amendments to our certificate of incorporation andby-laws, and the advisory vote on executive compensation, your shares will not be voted on these matters.

The approximate date of mailing of the Notice of Internet Availability of Proxy Materials to our stockholders is March 21, 2018,29, 2021, and the attached proxy statement, together with our 20172020 Annual Report on Form10-K, will be made available to our stockholders on that same date. We also will begin mailing paper copies of our proxy statement and other proxy materials to stockholders who have requested them on or about that date.

By order of the Board of Directors,

 

LOGO

John J. DiRocco, Jr.

Vice President, Assistant General Counsel and Corporate Secretary

March 21, 2018


Table of Contents

 

   Page   

QUESTIONS AND ANSWERS ABOUT THE 2021 ANNUAL MEETING

   1 

PROPOSAL 1 — ELECTION OF DIRECTORS

   58 

Board of Directors

   58

Recommendation

8

Director Nominee Skills, Experience and Background

9

Board Composition

10

Director Succession and Board Refreshment

11

Governance Committee Process for Director Nominations

11 

Certain Information Regarding Directors

   612 

THE BOARD OF DIRECTORS AND ITS COMMITTEES

   1217 

Meeting Attendance

   12

Executive Committee

1217 

Audit Committee

   1217 

Compensation Committee

   1318 

Governance Committee

   1318 

Compensation Committee Interlocks and Insider Participation

   1318 

CORPORATE GOVERNANCE

   1419 

Director Independence

   1419 

Board Leadership Structure

   14

Director Qualifications

1519 

Risk Oversight

   1520

Cybersecurity and Information Security Risk Oversight

21

Sustainability Matters

21 

Executive Sessions of the Board

   1521 

Corporate Governance Guidelines

   1522

Insider Trading Policy Restrictions on Hedging & Pledging

22 

Review of Related Person Transactions

   1522 

Director Attendance Policy

   1623 

Indemnification Agreements

   1623 

Code of Business Conduct and Ethics

   1623

Oversight of Management Succession

23

Board of Directors and Committee Evaluations

24 

Communications with the Board

   17

Governance Committee Process for Director Nominations

17

Oversight of Management Succession

1724 

DIRECTOR COMPENSATION

   1825 

Annual Retainer

   1825 

Retainer Stock Plan

   1825 

Directors’ Deferred Compensation Plan

   1825 

Director Stock Ownership Guidelines

   1926 

Director Compensation Table

   1926

PROPOSAL 2 — APPROVAL OF AMENDMENTS TO CERTIFICATE OF INCORPORATION AND BY-LAWS

28

Recommendation

29 

EXECUTIVE COMPENSATION

   2130 

Compensation Committee Report

   2130

Members of the Compensation Committee

30 

Compensation Discussion and Analysis

   2130 

Section 1 – Executive Summary

21

Changes to our Executive Compensation Programs

23

CEO Transition

24

Realizable Pay

24

Shareholder Engagement

25

Section 2 – Our Compensation Philosophy

25

Section 3 – Elements of Executive Compensation

27

Base Salary

27

Annual Cash Incentives

27

Long-Term Incentives

27

Section 4 – Role of Management, Compensation Consultants and Market Data

27

Section 5 – Pay Mix, Opportunity and Leverage

29

Base Salary

   30

Annual Cash Incentive Awards

30

Senior Executive Incentive Plan

33 

 

i


   Page   

Long-Term Performance Enhancement Plan

33

CEO Award at HireSection 2 – Our Compensation Philosophy

   35 

2015Section 32017 PSU Award

36

Section 6 – OtherRole of Management, Compensation

37

Perquisites Consultants and Market Data

   37 

Stock Ownership Guidelines

37

Hedging and Pledging Policies

38

Recoupment Policy

38

Retirement Benefits

38

Severance and Change in Control Benefits

39

Other SunCoke Energy Benefits

39

CEO Pay Ratio

39

Tax DeductibilitySection 4 – Elements of Executive Compensation

   39 

Assessment of Risk Related to Compensation PracticesSection 5 – Pay Mix, Opportunity and Leverage

   4039 

Savings Restoration PlanSection 6 – Other Compensation Information

   4847 

Potential Payments upon Termination or Change in Control

48

Tables:

•    Summary Compensation Table

   4150 

•    20172020 Grant of Plan-Based Awards Table

   4352 

•    20172020 Outstanding Equity Awards at Fiscal Year-End Table

   4554 

•    20172020 Option Exercises and Stock Vested Table

   4755 

•    20172020 Nonqualified Deferred Compensation Table

   4756 

Potential Payments Upon Termination or Change in Control Table

   50

PROPOSAL 2 — APPROVAL OF AMENDMENT  & RESTATEMENT OF LONG-TERM PERFORMANCE ENHANCEMENT PLAN

52

General

52

Reasons for Amendment of the 2013 Plan

52

Historical Equity Usage and Current Potential Dilution

53

Key Plan Features

54

Summary of Plan Provisions

54

SEC Registration

59

New Plan Benefits; Contingent Awards

59

Vote Required for Approval

5958 

PROPOSAL 3 — ADVISORY APPROVAL OF EXECUTIVE COMPENSATION

   6160 

PROPOSAL 4 — ADVISORY VOTE TO APPROVE THE FREQUENCY OF FUTURE ADVISORY VOTES ON EXECUTIVE COMPENSATIONRecommendation

   6360 

BENEFICIAL STOCK OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND PERSONS OWNING MORE THAN FIVE PERCENT OF COMMON STOCK

   6462 

AUDIT COMMITTEE MATTERS

   6764 

Audit Committee Report

   6764 

Audit Fees

   6865 

Audit CommitteePre-Approval Policy

   6865 

PROPOSAL 54 — RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

   7066

Recommendation

66 

OTHER INFORMATION

   7167 

Equity Compensation Plan Information

   7167 

Section 16(a) Beneficial Ownership Reporting ComplianceHouseholding of Proxy Materials

   7167 

Future Stockholder Proposals

   7168

Other Matters

68

Websites

68 

Solicitation of Proxies

   7268 

APPENDIX A: Certificate of Amendment

APPENDIX B: Bylaw Amendments

 

ii


 

QUESTIONS AND ANSWERS ABOUT THE 2021 ANNUAL MEETING

 

 

References to “the Company”, “SunCoke Energy”, “we”, “us” and “our” in this proxy statement mean SunCoke Energy, Inc.

Who is soliciting my vote?

The Board, on behalf of Directors of SunCoke Energy, Inc.the Company, is soliciting your proxy to vote your shares of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”) on all matters scheduled to come before the 2021 Annual Meeting, whether or not you attend. By completing, signing, dating and returning a proxy card or voting instructions form, or by submitting your proxy and voting instructions by telephone or via the Internet, you are authorizing the persons named as proxies to vote your shares of Common Stock at the 20182021 Annual Meeting.Meeting as you have instructed. The Company has retained Morrow Sodali, LLC, a proxy solicitation firm, which may solicit proxies on the Board’s behalf. Information contained on our corporate website is not part of this Proxy Statement. In addition, none of the information on other websites, if any, listed in this Proxy Statement is part of this Proxy Statement.

Why did I receive a notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?

Pursuant to rules adopted by the Securities and Exchange Commission, or SEC, we have elected to furnish our proxy statement and other proxy materials to stockholders on the Internet rather than mailing paper copies to each stockholder. If you received a Notice of Internet Availability of Proxy Materials, or Notice of Internet Availability, in the mail, you will not receive a paper copy of these materials unless you have requested to receive paper copies. All stockholders have the ability to access our proxy statement and other proxy materials. Instructions on how to do so, or to request a printed copy, may be found on the Notice of Internet Availability. In addition, stockholders may request to receive these materials in printed form by mail on an ongoing basis. The Notice of Internet Availability also will instruct you on how you may vote your shares and how you may vote over the Internet. Note that if you are a participant in the SunCoke 401(k) Plan and have shares of our common stock allocated to your Plan account, you have the right to direct the Plan trustee regarding how to vote those shares. YouParticipants in the SunCoke 401(k) Plan should automatically receivedreceive a paper copy of these materials in the mail.

What am I voting on?

You are voting on the following proposals:

 

  

Proposal 1:Election of Mr. Alvin BledsoeRalph M. Della Ratta, Jr. and Ms. Susan R. Landahl to the class of directors whose term expires in 20212024 (see pages 6 and 78 through 16);

 

  

Proposal 2:Approval of an amendment Proposed amendments to the SunCoke Energy, Inc. Long-Term Performance Enhancement PlanCompany’s Amended and Restated Certificate of Incorporation and its Amended and Restated By-laws to among other things, increaseprovide for the numberdeclassification of shares of common stock authorized for issuance thereunderthe Board ((see pages 52 through 60)28 and 29);

 

  

Proposal 3:Non-binding advisory vote to approve the compensation of our named executive officers (see pagepages 60 and 61)

 

  

Proposal 4:To consider an advisory vote to approve the frequency of future advisory votes on executive compensation (see page 63)

Proposal 5:Ratification of the of the Audit Committee’s appointment of KPMG LLP, or KPMG, as our independent registered public accounting firm for the fiscal year ending December 31, 20182021 (see page 70)66); and

 

Any other business properly coming before the meeting.

How does the Board of Directors recommend that I vote my shares?

The Board of Directors’ recommendations can be found with the description of each Proposal in this proxy statement. In summary, the Board of Directors recommends that you vote:

 

Proposal 1: “FOR”the election of each of the nominees for director;

 

Proposal 2:“FOR” approval of certainProposed amendments to the SunCoke Energy, Inc. Long-Term Performance Enhancement Plan, including an increase inCompany’s Amended and Restated Certificate of Incorporation and its Amended and Restated By-laws to provide for the numberdeclassification of shares of common stock reserved for issuance thereunder;the Board

 

Proposal 3:“FOR” thenon-binding advisory vote to approve the compensation of our named executive officers

Proposal 4: For“ONE YEAR” to hold an advisory stockholder vote to approve executive compensation every year;officers; and

 

Proposal 5:4: “FOR”the ratification of the Audit Committee’s appointment of KPMG as our independent registered public accounting firm for the fiscal year ending December 31, 2018.2021.

Who is entitled to vote?

Only stockholders of record at the close of business on March 7, 201816, 2021 are entitled to vote at the 20182021 Annual Meeting. As of that date, there were 64,587,75382,909,625 shares of our common stock outstanding. Each share of common stock is entitled to one vote. There is no cumulative voting.

How many votes must be present to hold the meeting?

Your shares are counted as present at the 20182021 Annual Meeting if you attend the meeting and vote in person or if you properly return a proxy by telephone, internet or mail. In order for us to hold our meeting, holders of a majority of our outstanding shares of common stock as of the close of business on March 7, 201816, 2021 must be present in personlive or by proxy at the meeting. This is referred to as aquorum. quorum. Proxy cards or voting instruction forms that reflect abstentions will be counted as shares present to determine whether a quorum exists to hold the 20182021 Annual Meeting. Brokernon-votes will not be counted for quorum purposes.

How are votes counted? How many votes are needed to approve each of the proposals?

ForProposal 1, you may vote FOR,�� “AGAINST,”” “AGAINST, or ABSTAIN” for each director-nominee. The affirmative vote of a majority of the votes cast for the election of directors at the 20182021 Annual Meeting is required to elect a nominee as a director. Abstentions and brokernon-votes are not counted as a vote cast either “FOR” or “AGAINST” a nominee. OurBy-laws set forth the procedures if a nominee does not receive at least a majority of votes cast at a meeting for election of directors where a quorum is present. In an uncontested election, any incumbent nominee for director who does not receive at least a majority of the votes cast must submit his or her resignation. The Governance Committee will evaluate the tendered resignation and make a recommendation to the Board whether to accept or reject the resignation. The Board will act on the tendered resignation and publicly disclose its decision within ninety (90) days after the certification of the election results. If the incumbent director’s resignation is not accepted by the Board, such director will continue to serve until the next annual meeting, or until his or her successor is duly elected and qualified. If the director’s resignation is accepted by the Board, the Board may fill the resulting vacancy in accordance with the applicable procedures set forth in theBy-laws.

ForProposal 2, you may vote “FOR”, “AGAINST”, or “ABSTAIN,” and the affirmative vote of the holders of at least eighty percent (80%) of the voting power of all the Company’s then-outstanding shares is required for approval. Thus, in order to be adopted, Proposal 2 must receive more than eighty percent (80%) of all the Company’s then-outstanding shares. Abstentions will have the effect of a vote AGAINSTthis proposal.

For Proposals 2, 3 and 54, you may vote “FOR”, “AGAINST”, or “ABSTAIN,” and the affirmative vote of a majority of the shares present in personlive or by proxy and entitled to vote on these proposals at the 20182021 Annual Meeting is required for approval. Thus, in order to be adopted,approved, Proposals 2, 3 and 54 each must receive more than fifty percent (50%) of the shares present in personlive or represented by a proxy at the meeting2021 Annual Meeting and entitled to vote at the meeting. Abstentions will have the effect of a voteAGAINSTthese proposals. Brokernon-votes will have the effect of a vote “AGAINST” Proposal 3. There will be no effectbroker non-votes with respect to Proposal 4, since it is the only item on the outcomeagenda for which brokers may exercise their discretion to vote “FOR” or “AGAINST” the proposal in the absence of any instructions from the beneficial owners.

What is a “broker non-vote”?

A broker non-vote occurs when the beneficial owner of theshares held of record by a broker, bank, trust, or other nominee fails to provide such broker, bank, trust, or other nominee with specific instructions concerning how to vote on any “non-routine” matters brought to be voted ona vote at a stockholders meeting. The New York Stock Exchange (“NYSE”) rules determine whether proposals are routine or not routine. If a proposal is routine, a broker holding shares for an owner in Proposals 2, 3 and 5.

ForProposal 4, youstreet name may vote to hold an advisory say-on-pay vote to approve our executive compensation every“ONE YEAR,” “TWO YEARS,” or“THREE YEARS,” or you may“ABSTAIN.” For Proposal 4, the frequency of the advisory vote to approve executive compensation (every one, two or three years) receiving the affirmative plurality of the votes properly cast on the proposal without voting instructions. As a result, brokers are not entitled to vote on Proposals 1, 2 and 3 at the 20182021 Annual Meeting without receiving voting instructions from the beneficial owners, but are entitled to vote on Proposal 4. If a broker exercises its discretion to vote on Proposal 4 but does not have instructions from the beneficial owner on how to vote on Proposals 1, 2, or 3, the underlying shares will be consideredcounted for establishing the frequency recommended by stockholders. Abstentions andpresence of a quorum. If you do not provide voting instructions to your bank, broker, non-votestrustee or other nominee holding shares of Common Stock for you, your shares will have no effect on the voting for this proposal.not be voted with respect to Proposals 1, 2, or 3.

How do I vote?

You can vote either in personby attending at the 20182021 Annual Meeting or by proxy without attending the meeting. Most stockholders have threefour options for submitting their votes:

 

viatelephone, using the toll-free number listed on your proxy card (if you are a stockholder of record) or voting instruction form (if your shares are held by a broker, financial institution, or other nominee);

By telephone, using the toll-free number listed on your proxy card (if you are a stockholder of record) or voting instruction form (if your shares are held by a broker, financial institution, or other nominee). The telephone voting procedures are designed to authenticate a stockholder’s identity to allow stockholders to vote their shares and confirm that their instructions have been properly recorded. Voting by telephone authorizes the named proxies to vote your shares in the same manner as if you had submitted a validly executed proxy card;

 

overOver the Internet, at the address provided on the Notice of Internet Availability or on your proxy card or voting instruction form; orform. The Internet procedures are designed to authenticate a stockholder’s identity to allow stockholders to vote their shares and confirm that their instructions have been properly recorded. Internet voting facilities for stockholders of record are available 24 hours a day. Voting via the Internet authorizes the named proxies to vote your shares in the same manner as if you had submitted a validly executed proxy card;

 

Through the Mail, by completing, marking, signing, dating and mailing your proxy card or voting instruction form and returning it in the envelope provided. If you return your signed proxy card or voting instruction form but do not mark the boxes showing how you wish to vote, your shares will be voted in accordance with the recommendation of the Board of Directors for each of the proposals for which you did not indicate a vote. Proxy cards submitted by mail must be received by the time of the 2021 Annual Meeting in order for your shares to be voted; or

Live at the 2021 Annual Meeting. Shares held in your name as the stockholder of record may be voted by you at the 2021 Annual Meeting. Shares held beneficially in “street name” may be voted by you at the 2021 Annual Meeting only if you obtain a legal proxy from the broker or other agent that holds your shares giving you the right to vote the shares and hold such proxy during

the 2021 Annual Meeting. If you vote by proxy and also attend the 2021 Annual Meeting, you do not need to vote again at the 2021 Annual Meeting unless you wish to change your vote.

If you are the registered stockholder (that is, if you hold your stock in your name), you can vote via telephone or over the Internet by following the instructions provided on the Notice of Internet Availability or on your proxy card. If your shares are held in “street name” (that is, they are held in the name of a broker, financial institution, or other nominee), you will receive instructions with your materials that you must follow in order to have your shares voted. Please review your voting instruction form to determine whether you will be able to votevia the telephone or over the Internet. The deadline for voting via the telephone or over the Internet for the 2018 Annual Meeting is 11:59 p.m. Eastern Time, May 2, 2018.

Even if you plan to attend the 20182021 Annual Meeting, we encourage you to vote your shares by proxy. If your shares are held in “street name,” you must request a legal proxy from your broker, financial institution or other nominee and bringhold that proxy toduring the meeting to vote in person at the meeting.

As a SunCoke Energy employee, how do I vote my 401(k) Plan shares?

If you are an employee of SunCoke Energy or one of our subsidiaries and you participate in the SunCoke Energy, Inc. 401(k) Plan and/or the SunCoke Energy, Inc. Savings Restoration Plan (each being a “Plan”), the enclosed voting instruction form indicates the aggregate number of shares of SunCoke Energy Common Stock credited to your applicable Plan account as of March 16, 2021, the Record Date for voting at our 2021 Annual Meeting. If you timely submit your voting instructions to the Plan Trustee (Vanguard) by following the instructions on the enclosed voting instruction form, your shares will be voted as you have directed. If you sign and return a voting instruction form to the Plan Trustee without giving any specific voting instructions, then the Plan Trustee will vote your shares on your behalf in the manner recommended by our Board on all of the proposals, including the election of directors. If you do not submit a validly executed voting instruction form or otherwise validly submit any voting instructions to the Plan Trustee by 11:59 p.m. Eastern Time on May 9, 2021, your shares will be voted by the Plan Trustee in the same proportion as the instructions provided to the Plan Trustee by other participants in such Plan. Please note that Plan participants may vote their shares only through the Plan Trustee, and accordingly may not vote their Plan shares live at the 2021 Annual Meeting.

Can I change or revoke my vote?

Yes.YES. You can change or revoke your vote at any time before the polls close at the 2018 Annual Meeting by:

 

re-voting via telephone or over the internet (only your latest telephone or internet vote will be counted),

 

signing and dating a new proxy card and submitting it (only your latest proxy card will be counted),

 

if you are a registered stockholder, delivering timely notice of revocation to the Corporate Secretary, SunCoke Energy, Inc., 1011 Warrenville Road, Suite 600, Lisle, Illinois 60532, or

 

attending the 20182021 Annual Meeting and voting in person.voting.

If your shares are held in “street name,” please contact your broker, financial institution or other nominee and comply with the broker’s, financial institution’s or other nominee’s procedures if you want to change or revoke your previous voting instructions. Attending the 20182021 Annual Meeting in person will not in and of itself revoke a previously submitted proxy unless you specifically request it.

Who counts the votes?

We have retained Broadridge Financial Solutions, Inc.Computershare Trust Company, N.A., our transfer agent, to act as independent inspector of election and as proxy vote tabulator. Broadridgetabulator to count the votes represented by proxies cast by telephone, the Internet and ballot. A representative of Computershare will act as the Inspector of Election. Computershare will determine whether or not a quorum is present, will count the shares voted (including shares voted during the 2021 Annual Meeting) and will certify the election results.

Can other matters be decided at the 20182021 Annual Meeting?

WeAs of the date of this Proxy Statement, we are not aware of any business to be brought before the 2021 Annual Meeting, other than the matters that will be considered at the 2018described in our Notice of Annual Meeting.Meeting of Stockholders. If any other matters arise,properly come before the 2021 Annual Meeting, the named proxies will vote in accordance with their best judgment.

Who can attend the meeting?

The 20182021 Annual Meeting is open to all SunCoke Energy stockholders.

How can I attend the Annual Meeting?

The 2021 Annual Meeting will be a virtual-only meeting of stockholders, conducted exclusively by live audio webcast. No physical meeting will be held. You may contact Investor Relationsare entitled to participate in the 2021 Annual Meeting only if you were a SunCoke Energy stockholder as of the close of business on the Record Date, or if you hold a valid proxy for directionsthe 2021 Annual Meeting. You will be able to attend the Annual Meeting online and submit your questions during the meeting by visiting www.meetingcenter.io/290737273. You also will be able to vote your shares online by attending the 2021 Annual Meeting by webcast.

To participate in the Annual Meeting, you will need to review the information included on your Notice, on your proxy card, or on the instructions that accompanied your proxy materials. The password for the meeting is SUNC2021. If you hold your shares through an intermediary, such as a bank or broker, you must register in advance using the instructions below.

We recommend that you carefully review the procedures needed to gain admission in advance. If you do not comply with the procedures described here for attending the 2021 Annual Meeting via live audio webcast, you will not be able to participate online.

The online meeting will begin promptly at 9:00 a.m., Central Time. We encourage you to access the meeting prior to the start time, leaving ample time for check-in. Please follow the registration instructions as outlined in this proxy statement.

investorrelations@suncoke.comHow do I register to attend the Annual Meeting virtually on the Internet?

If you are a registered shareholder (i.e. When, you arrivehold your shares through our transfer agent, Computershare), you do not need to register to attend the 2021 Annual Meeting virtually on the Internet. Please follow the instructions on the notice or proxy card that you received.

If you hold your shares through an intermediary, such as a bank or broker, you must register in advance to attend the 2021 Annual Meeting virtually on the Internet. To register to attend the 2021 Annual Meeting online by webcast you must submit proof of your proxy power (legal proxy) reflecting your SunCoke Energy, Inc. holdings, along with your name and e-mail address, to Computershare. Requests for registration must be labeled as “Legal Proxy” and must be received no later than 5:00 p.m., Eastern Time, on April 27, 2021. Requests for registration should be directed to Computershare at the Hotel Arista, 2139 CityGate Lane, Naperville, Illinois 60563, signsfollowing:

By e-mail:

Forward the email from your broker, or attach an image

of your legal proxy, to legalproxy@computershare.com

By U.S. mail:

Computershare

SunCoke Energy, Inc. Legal Proxy

P.O. Box 505008

Louisville, KY 40233-9814.

You will directreceive a confirmation of your registration by e-mail after Computershare receives your registration materials.

What if I have technical difficulties or trouble accessing the virtual meeting website?

The virtual meeting platform is fully supported across MS Edge, Firefox, Chrome and Safari browsers and devices (desktops, laptops, tablets and cell phones) running the most up-to-date version of applicable software and plugins. Please note that Internet Explorer is no longer supported. Participants should ensure that they have a strong WiFi connection wherever they intend to participate in the meeting. We encourage you to access the meeting prior to the start time. A link on the meeting page will provide further assistance should you need it, or you may call 1-888-724-2416 or 1-781-575-2748. There will be technicians ready to assist you with any technical difficulties you may have accessing the virtual meeting website.

Why are you holding a virtual meeting instead of a physical meeting?

We are excited to embrace the latest technology to provide expanded access, improved communication and cost savings for our stockholders and the Company. We believe that hosting a virtual meeting will enable more of our stockholders to attend and participate in the meeting since our stockholders can participate from any location around the world with Internet access.

How do I submit questions or comments for the Annual Meeting?

Stockholders can submit questions or comments online during the Annual Meeting via live audio webcast by visiting www.meetingcenter.io/290737273. We will answer timely submitted questions or comments on a matter to be voted on at the Annual Meeting before voting is closed on the matter. Questions or comments received during the Annual Meeting will be presented as submitted, uncensored and unedited, except that we may omit certain personal details for data protection issues, or we may edit profanity or other inappropriate language. Questions or comments regarding general economic, political or other views that are not directly related to the business of the meeting, that are of an individual concern to a stockholder, or that are not an appropriate subject matter for general discussion, are not pertinent to the meeting room. You needand therefore will not attendbe presented. If we receive substantially similar questions, we may group those questions together and provide a single response to avoid repetition.

Who will pay for the 2018cost of proxy preparation and solicitation of proxies?

SunCoke Energy will bear the entire cost of solicitation of proxies, including preparation, assembly and mailing of this Proxy Statement, the Proxy Card, the Notice of Annual Meeting and any additional information furnished to stockholders. Copies of solicitation materials will be furnished to banks, brokerage houses, fiduciaries and custodians holding shares of our Common Stock in ordertheir names that are beneficially owned by others to vote.forward to those beneficial owners. We may reimburse brokerage firms, banks, trusts, or other nominees representing beneficial owners, for the reasonable charges and expenses of forwarding proxy solicitation materials to “street name” holders. We have hired Morrow Sodali LLC, 470 West Ave, Stamford, Connecticut 06902, a proxy solicitation firm, to assist us in soliciting proxies for a fee of $9,500.00, plus reasonable out-of-pocket expenses for proxy solicitation services.

What happens if the meeting is postponed or adjourned?

If you wishthe meeting is postponed or adjourned, your proxy will still be good and may be voted at the postponed or adjourned meeting. You will still be able to attendchange or revoke your proxy until it is voted. See “Can I change or revoke my vote?” above.

How can I obtain a stockholder list?

A list of stockholders entitled to vote at the 20182021 Annual Meeting please checkwill be open to examination by any stockholder, for any purpose germane to the box2021 Annual Meeting, on yourour website at www.SunCoke.com for a period of ten days before the 2021 Annual Meeting and during the 2020 Annual Meeting at www.meetingcenter.io/290737273.

How may I obtain a copy of the Company’s 2020 Annual Report on Form 10-K?

A copy of our 2020 Annual Report on Form 10-K for the fiscal year ended December 31, 2020, is being provided to you along with this Proxy Statement. However, the Company’s Annual Report on Form 10-K is not part of the proxy or voting instruction form, or as indicatedsoliciting materials. You also may obtain a copy of our 2020 Annual Report on the internet voting site, or press the appropriate key if votingForm 10-K without charge by telephone. If your shares are held in “street name” and you would like to attend the meeting, please alsoe-mailinvestorrelations@suncoke.comor write to Investor Relations,writing to: SunCoke Energy, Inc., 1011 Warrenville Road Suite 600, Lisle, Illinois 60532. Include a copy60532, Attn: Investor Relations. Our 2020 Annual Report on Form 10-K also is available free of your brokerage account statement or an omnibus, or legal, proxy (which you can get from your broker,charge through our website at www.SunCoke.com, and which you must have, and bring with you, in order to vote in personthe SEC’s website at the meeting).

At the 2018 Annual Meeting, each stockholder may be asked to present valid picture identification (for example, a driver’s license or passport). If your shares are held in “street name,” you must bring a copy of a brokerage statement, proxy or letter from the broker, financial institution or other nominee confirming ownership of shares of our common stock at the close of trading on March 7, 2018, the record date for the 2018 Annual Meeting.

For security purposes, no cameras, recording equipment, electronic devices, large bags, backpacks, briefcases or packages will be permitted in the meeting room or adjacent areas, and other items will be subject to search.www.sec.gov.

IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 3, 2018:13, 2021:

This proxy statementProxy Statement and our Annual Report on Form10-K for the year ended December 31, 20172020 are available in the “Investor Relations” section of our website at the following internet address:http://www.suncoke.comwww.SunCoke.com

 

PROPOSAL 1 — ELECTION OF DIRECTORS

 

 

Board of Directors

Our Board of Directors annually recommends the slate of director-nominees for election by stockholders at the Annual Meetingannual meeting and is responsible for filling vacancies on the Board at any time during the year. The Governance Committee has a process to identify and review qualified candidates to stand for election, and the full Board reviews and has final approval of all potential director nominees being recommended to the stockholders for election. Our Board of Directors currently consists of eight members: Andrew D. Africk,Arthur F. Anton, Alvin Bledsoe, Peter B. Hamilton,Martha Z. Carnes, Ralph M. Della Ratta, Jr., Susan R. Landahl, Robert A. Peiser,Michael W. Lewis, Michael G. Rippey John W. Rowe and James E. Sweetnam. As previously announced, Messrs. Bledsoe and Sweetnam are retiring from the Board and will not stand for re-election at the 2021 Annual Meeting.

Our Board of Directorscurrently is divided into three classes, each serving staggered three-year terms. Directors for each class are elected at the annual meeting of stockholders held in the year in which the term for their class expires. There are two nominees for election this year. The terms of Alvin BledsoeThese nominees are Ralph M. Della Ratta, Jr. and Susan R. Landahl, expire this year, and the Board of Directors has nominated each of them for a new three-year term that will expire at the annual meeting in 2021,2024, or until their respective successors are elected and qualified.

Detailed information on these nominees is provided on pages 612 through 11,15, including a discussion of each nominee’s specific experience, qualifications and attributes or skills that led our Board to conclude that such person should serve as a director of SunCoke Energy. Each of these nominees is a current director, and each has consented to be named in this Proxy Statement and to serve if elected. If any nominee is unable to serve as a director at the time of the 20182021 Annual Meeting, your proxy may be voted for the election of another nominee proposed by the Board, of Directors, or the Board of Directors may reduce the number of directors to be elected at the 20182021 Annual Meeting. At this time, the Board of Directors knows no reason why eitherany of these nominees maywould not be able to serve as a director if elected.

RECOMMENDATION

RECOMMENDATION

The Board of Directors unanimously recommends that you vote FOR“FOR” the election of the Company’s two nominees for director.director: Ralph M. Della Ratta, Jr. and Susan R. Landahl.

Certain Information Regarding DirectorsDirector Nominee Skills, Experience, and Background

Below isThe following pages contain information regarding the specific experience, qualifications, attributes and skills that qualify the nominees and the directors whose terms of office will continue after the 20182021 Annual Meeting to serve as a director of SunCoke Energy.Energy, Inc. The following is a summary of some of the skills, experience, and background that our directors bring to the Board:

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Investment Banking/Capital Markets Experience

Significant capital markets experience involving issuance of public company debt and/or equity. Mergers and acquisitions deal expertise and sophistication. Project finance expertise.

Information Technology/Data Security Experience

General information systems experience. Understanding of information security risk management and oversight of data integrity.

Strategic Planning/Business Development

CEO or COO for a manufacturing entity. Development and implementation of proactive, innovative and pragmatic solutions for optimizing of manufacturing processes.

Financial Expertise/ Accounting Knowledge

Corporate finance and/or accounting experience at an executive level. Use of financial information to shape, drive, and monitor effectiveness of organizational strategies.

Human Resources Management

Knowledge and expertise in labor and employment matters (e.g., EEO, diversity, equity and inclusion issues), compensation and benefit, and health and welfare plans.

Government Relations/ Agency Experience

Significant experience dealing with government at the local, state and federal levels on issues such as economic development, energy, environmental, health and safety issues.

International Experience

Experience with international business/markets managing the affairs of a global, publicly traded company, particularly in countries where SunCoke does business, or would like to do business.

Enterprise Risk Management

Experience planning, organizing and leading activities of an organization in order to minimize the effects of financial, strategic, operational, and other risks on capital and earnings.

Board Composition

Our directors come from a variety of backgrounds and bring a diverse set of skills and experiences to the boardroom. In conjunction with our Board’s refreshment process, the Board regularly reviews the skills, experience, and background of our directors to better align with the Company’s strategic vision, and business and operations. The Board has taken a thoughtful and deliberate approach to board composition to ensure that our directors have backgrounds that collectively add significant value to the strategic decisions made by the Company and enable them to provide oversight of management to ensure accountability to our stockholders. The following charts highlight the balance in age and the diversity in tenure, gender and ethnicity of the nominees and the directors whose terms of office will continue after our 2021 Annual Meeting:

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Director Succession and Board Refreshment

The Governance Committee oversees and plans for director succession and refreshment of the Board to ensure a mix of skills, experience, tenure, and diversity that promote and support SunCoke Energy’s long-term strategy. In doing so, the Governance Committee takes into consideration the overall needs, composition and size of the Board, as well as the criteria adopted by the Board regarding director candidate qualifications. The Governance Committee considers director-nominees from various sources and chooses nominees with the primary goal of ensuring that the Board collectively serves the interests of our stockholders.

The Governance Committee annually reviews the qualifications and experience of current directors and identifies specific competencies required in director-nominees. Director nominees should have a proven record of professional success and leadership and demonstrate the highest personal and professional ethics, integrity and values. The Board also considers diversity of age, ethnicity and gender. Directors also are expected to devote sufficient time and effort to their duties as members of the Board.

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Governance Committee Process for Director Nominations

The Governance Committee evaluates potential director candidates and makes recommendations to the Board. Candidates may be identified by current directors, by a search firm or by stockholders. The Governance Committee may engage the services of a third-party consultant to assist in identifying and screening potential candidates. The Governance Committee’s evaluation of a candidate generally includes inquiries as to the candidate’s reputation and background, examination of the candidate’s experience and skills in relation to the Board’s requirements at the time, consideration of the candidate’s independence as measured by the Board’s independence standards and any other considerations that the Governance Committee deems appropriate. Candidates should have a proven record of professional success and leadership and demonstrate the highest personal and professional ethics, integrity and values. Age, ethnic and gender diversity also are considered. At least annually, the Governance Committee reviews the criteria for the nomination of director candidates and approves changes to the criteria, as appropriate. Following its evaluation process, the Governance Committee recommends candidates to the full Board. The Board makes the final determination regarding a candidate based on its consideration of the Governance Committee’s recommendation. Candidates recommended by our stockholders will be evaluated on the same basis as candidates recommended by current directors, search firms, or third-party consultants.

Certain Information Regarding Directors

On the following pages is information regarding the specific experience, qualifications, attributes and skills that qualify the nominees and directors below to serve on the SunCoke Energy Board of Directors. The principal occupation and business experience of each director, and the reasons the Board believes each of the two nominees, Ralph M. Della Ratta, Jr. and Susan R. Landahl, should be elected to serve on the Board, are described below.

 

 

Nominees to Serve in a Class WhoseIII

Term Expires inNominees Up for Election at the 2021 Annual Meeting

 

 

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Alvin BledsoeRalph M. Della Ratta, Jr.

 

Age:  70  67

 

Committee

Membership:  Audit

  Compensation (Chair)

Mr. Bledsoe was elected as a director of SunCoke Energy, Inc. in June 2011. Effective September 1, 2017, he alsoDella Ratta was appointed as a director of SunCoke Energy, Inc., effective December 3, 2020. From 2004 to 2017, he was Founder, Senior Managing Director and Chief Executive Officer of Western Reserve Partners GP LLC, a Cleveland, Ohio based investment banking merger and acquisition advisory firm. The firm was acquired in 2017 by Citizens Financial Group [NYSE: CFG], a large commercial banking institution. Since the general partneracquisition, Mr. Della Ratta has served as Co-Head of SunCoke Energy Partners, L.P.Merger and Acquisition Advisory Services for Citizens Financial Group, Inc., our sponsored master limited partnership.leading a team focused on delivering M&A services and related financial analysis to middle-market customers. From 1972 until his retirement from the firm in 2005,2004 to 2020, Mr. BledsoeDella Ratta served in various senior roles at PricewaterhouseCoopers LLP, or PwC (an international accounting firm). In 2007, he joinedon the Board of Directors of Crestwood Gas Services GP LLC, the general partner of Crestwood Midstream Partners LPOlympic Steel, Inc. [NASDAQ: ZEUS] (a natural gas and crude oil logistics master limited partnership), formerly Quicksilver Gas Services. Upon the October 2013 merger and subsequent related corporate restructuring between Crestwood Midstream Partners LP, Inergy, L.P. and Inergy Midstream, L.P., Mr. Bledsoe was appointed to the boards of Crestwood Midstream GP LLC, the general partner of Crestwood Midstream Partners LP and Crestwood Equity GP LLC, the general partner of Crestwood Equity Partners LP (a natural gas and crude oil logistics master limited partnership holding company)leading U.S. metals service center), where he chaired the Audit Committees of both companies. In 2015, Crestwood Equity Partners LP acquired Crestwood Midstream Partners LP and eliminated the need for a separate Board of Directors at Crestwood Midstream Partners GP LLC. Mr. Bledsoe is a director of Crestwood Equity GP LLC, and is the chair of its Audit Committee. From May 2007 to August 2010, Mr. Bledsoe served aswas Lead Independent Director, a member of the Archuleta County Colorado Financial Advisory Task Force.Audit and Compliance Committee and, at different times, served as Chair of the Compensation Committee and Chair of the Nominating Committee. Mr. Della Ratta is involved in numerous non-profit and civic organizations, including: The Duke University Alumni Association and Annual Fund, Kent State University Board of Trustees (past Chair), The Ohio Venture Capital Authority, The Rock and Roll Hall of Fame, and United Cerebral Palsy Telethon (Chair).

Mr. Bledsoe is an experienced financeDella Ratta brings valuable business and public accounting executive, having spent his entire33-year careerextensive financial experience to the Board, particularly with PwC. By virtue of his experience,regard to capital raising, commercial banking, mergers and acquisitions, strategic financial analysis and capital markets transactions. In addition, Mr. Bledsoe is knowledgeable about finance, merger and acquisition transactions and major cost restructurings and possessesDella Ratta also has knowledge of manufacturing and distribution in the mining, utilitiessteel and energy industries. In addition, he brings relevant industry expertise, having served clients within these industry sectors and having served as the global leader for PwC’s Energy, Mining and Utilities Industries Assurance and Business Advisory Services Group. While at PwC, Mr. Bledsoe also gained experience working with boards of directors by interfacing with the boards of directors of his clients.metals services industry.

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Susan R. Landahl

 

Age:  57  60

 

Committee

MembershipMembership:  Compensation

:  Governance (Chair)  Audit, Governance

Ms. Landahl was appointed as a director of SunCoke Energy, Inc., effective September 1, 2017. SinceFrom June 2015 until her retirement in January 2021, Ms. Landahl has served as Senior Vice President, Organizational Effectiveness and Integrated Performance Assessment of Exelon Generation Company, LLC, a major generator and marketer of electricity and a subsidiary of Exelon Corporation, one of the nation’s largest power generators, with operations in 48 states. Since joining Exelon in 1999, Ms. Landahl has held a number of senior leadership positions, including Senior Vice President, Operations Integration & Business Development from August 2012 to January 2014, and Chief Operating Officer & Senior Vice President, Exelon Nuclear from June 2010 to August 2012. In this latter position, she oversaw 10 nuclear facilities with 17 nuclear reactors in Illinois, New Jersey and Pennsylvania, and was responsible for 5,000 employees and annual budgets in excess of $1.5 billion. Exelon’s nuclear fleet has since grown to 14 nuclear facilities, including 23 reactors in five states. As Vice President, Industry Leadership at the Institute for Nuclear Power Operations from January 2014 to June 2015, Ms. Landahl led development of INPO15-005, now the industry standard for leadership development and organizational effectiveness for the entire U.S. nuclear fleet and much of the world. She is a current member of the Advisory Committee for the Future of Nuclear Study.

Ms. Landahl is a knowledgeable and experienced industry leader with strong operational skills and a proven track record for successfully managing large, complex projects and major project turnarounds. She has a keen and strategic understanding of the energy industry, and possesses senior-level business development, planning and managerial experience.

 

 

Class I

Continuing Directors — Current Term Expires in 20192022

 

 

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Andrew D. AfrickArthur F. Anton (Chairman)

 

Age:  51  63

 

Committee

Membership:  Compensation

  Compensation  Governance

Mr. AfrickAnton was appointed as a director of SunCoke Energy, Inc., effective March 7, 2016.16, 2020, and was appointed as non-executive Chairman of the Board effective January 1, 2021. During the course of his career, Mr. Africk founded Searay Capital LLCAnton has served in various senior roles at The Swagelok Company (a private investmentlarge fluid systems technology company) most recently as Chairman of the board from September 2017 to December 2019, and as Chief Executive Officer from 2004 to 2017. Prior to that, he served as Swagelok’s President and Chief Executive Officer from 2004 to 2017, as its President and Chief Operating Officer from 2001 to 2004, as its Executive Vice President from 2000 to 2001, and as its Chief Financial Officer from 1998 to 2000. Prior to joining Swagelok in 2013. He previously spent 21 years at Apollo Global Management LLC (an alternative asset management1998, Mr. Anton was a Partner

of Ernst & Young LLP (a professional accounting and consulting services firm), includingwhere he consulted with companies in manufacturing, energy, service, and other industries. Mr. Anton currently serves as a senior partner responsible for Apollo’s investments in technology and communications, including Apollo’s purchases of Intelsat Ltd. (a global provider of commercial satellite services) and Hughes Communications, Inc. (a leading provider of satellite technology). Mr. Africk servesdirector on the boards of ADT Inc. (the largest home security monitoring company in the U.S.) and of RPX Corp.following companies: Olympic Steel [NASDAQ: ZEUS] (a manager of

patent assets for the high technology sector). Mr. Africk’s previous public company boardleading U.S. metals service includes Hughes Communications, Inc. (December 2005 to June 2011)center), where he servedis the Lead Independent Director and a member of both the Audit and Compliance Committee, and the Compensation Committee; The Sherwin-Williams Company [NYSE: SHW] (a major paint coatings manufacturer), where he serves as Chair of the Governance Committee and a member of the CompensationAudit Committee; and Hughes Telematics, Inc. (April 2009 to June 2013)Diebold Nixdorf, Incorporated [NYSE: DBD] (a leading manufacturer of automated teller, calculating, and accounting machinery), where he servedserves as a memberChair of the Compensation Committee. In addition, Mr. Africk serves on several private company boards,Finance Committee and also is a member of the BoardAudit Committee. Mr. Anton also serves as Chairman of OverseersUniversity Hospitals Health System in the Cleveland, Ohio area.

Mr. Anton is an experienced corporate executive with strong operational, financial and leadership expertise, along with significant experience in the steel industry. He brings substantial domestic and international manufacturing and distribution experience and strategic planning expertise to our Board. In addition, as a former partner of the University of Pennsylvania School of EngineeringErnst & Young LLP and the UCLA Science Board.

former Chief Financial Officer of Swagelok, Mr. AfrickAnton has significant strategic planning, business developmentfinancial expertise and managerial skills, with more than 20 yearsextensive financial experience. He also possesses health, environment and safety oversight experience by virtue of corporate managementhis oversight experience as Chief Executive Officer and director experience. His proficiency in making and managing private equity investments and his extensive knowledge and experience in financing, analyzing and investing in public and private companies make him a valuable resource for SunCoke’s Board of Directors.Chief operating Officer at Swagelok.

 

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Robert A. PeiserMichael W. Lewis

 

Age:  70  71

 

Committee

Membership:  Audit

  Compensation (Chair)  Governance

Mr. PeiserLewis was appointed as a director of SunCoke Energy, Inc., effective March 7, 2016.December 3, 2020. During the course of his career, Mr. Peiser is engagedLewis has risen through progressively responsible senior leadership positions at BMO Harris Bank, N.A. (a large U.S. banking institution and subsidiary of Bank of Montreal, the Canadian multinational investment bank and financial services company) and, from 1998 until his retirement in active service on public2013, Mr. Lewis was Executive Vice President, and Chicago metro regional president. His responsibilities have included strategic integration and management of business segments across the regional network of BMO Harris branches, as well as privategrowing the bank’s commercial and retail business, community development and consumer loans and services. Mr. Lewis is an active member of Chicago’s business and civic communities and has served on several boards, including the Chicago Regional Transportation Authority, the Urban Partnership Bank (a full-service community development bank), and Chicago United (a corporate membership andnot-for-profit boards. From 2008 to May 2010, advocacy organization promoting economic opportunities by advancing multiracial leadership in corporate governance, executive level management, and business diversity). Mr. PeiserLewis also serves on the Foundation Board of Western Michigan University and has served as the Chief Executive Officer andpast Chairman of the Board of Omniflight Helicopters, Inc. (an air medical services provider). From April 2002 through January 2008, he was President, CEO and a director of Imperial Sugar Company (a refiner and marketer of sugar products). Mr. Peiser has been a director of USA Truck, Inc. (intermodal transportation and logistics services provider) since February 2012 and has been its Chairman since November 2012. His previous public company board service includes Standard Register Company (October 2013 to November 2015), where he served as chair of its Compensation Committee and was a member of its Governance Committee; Primary Energy Recycling Corp. (June 2013 to December 2014), where he served as Chairman of the Board and was a member of the Audit, Compensation and Governance Committees; Team Industrial Services, Inc. (July 2007 to September 2012), where he was a member of the Audit, Compensation and Executive Committees; Solutia, Inc. (February 2008 to July 2012), where he served as chair of the Governance Committee and was a member of the Risk Committee; and Signature Group Holdings, Inc. (June 2010 to May 2011) where he served as Vice Chairman and was chair of the Audit Committee. In addition, Mr. Peiser previously served as Chairman of the Texas TriCities Chapter of the National Association of Corporate Directors.Western Michigan University Business School Advisory Council.

Mr. PeiserLewis is an experienced senior-level corporatebanking executive with general operations, financial management, sales and marketing, strategic planning, corporate restructuring and business development experience. Hewho has operated as chief executive officer and/or chief financial officer of both public and private companiesspent over 40 years in several industries, including transportation services, energy, food processing, retailing, distribution and telecommunications.

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John W. Rowe (Chairman)

Age:  72

Committee

Membership:  Executive, Governance

Mr. Rowe was elected as a director of SunCoke Energy, Inc., effective April 1, 2012, and was appointed asnon-executive Chairman of the Board effective January 1, 2018. On March 12, 2012, Mr. Rowe retired as Chairman, Chief Executive Officer and director of Exelon Corporation, or Exelon (an electric utility company), and as a director of Commonwealth Edison Company and PECO Energy Company, both subsidiaries of Exelon. He served as a director and Chief Executive Officer orCo-Chief Executive Officer of Exelon since its formation in October 2000. He served as Chairman and Chief Executive Officer of Exelon since April 2002. At various times since 2000, he also held the title of President of Exelon. He previously served as Chairman, President and Chief Executive Officer of Unicom Corporation and Commonwealth Edison Company from March 1998 until October 2000. Mr. Rowe is a director of Northern Trust Corporation (an international financial services company), where he serves as a member of its Corporate Governance Committee, and its Capital Governance Committee, Compensation and Benefits, and Executive Committees. Mr. Rowe also joined the Board of Directors of The Allstate Corporation (an insurance company) in 2012 and serves as a member of its Compensation and Succession Committee and its Nominating and Governance Committee. Effective December 31, 2011, Mr. Rowe retired as a director of Sunoco, Inc. (a transportation fuel providerindustry with interests in logistics) and as chair of its Corporate Responsibility Committee and as a member of its Compensation and Executive Committees.

Mr. Rowe, with nearly 30 years of experience with electric utility companies in various positions, including serving as Chief Executive Officer of Exelon, has senior management-level experience and general operations and manufacturing experience. Mr. Rowe possessesbusiness line responsibility. He provides significant senior management-level strategic planning, business development and managerial experience, as well as health, environment and safety oversight experience. Additionally, Mr. Rowe possesses government relations, regulatory agency and legal experience by virtue of his position as Chief Executive Officer at Exelon and prior business experience and education.expertise to the Board.

 

Class II

Continuing Directors — Current Term Expires in 20202023

 

 

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Peter B. HamiltonMartha Z. Carnes

 

Age:  71Age:  60

 

Committee

MembershipMembership::  Audit Governance(Chair)

Mr. HamiltonMs. Carnes was electedappointed as a director of SunCoke Energy, Inc., effective December 5, 2019. From 1982 until her retirement from the firm in June 2011. He2016, Ms. Carnes served in various senior roles at PricewaterhouseCoopers, or PwC (an international accounting firm), including as: (i) Assurance Partner serving large, publicly traded companies in the energy industry; (ii) Managing Partner of PwC’s Houston, Texas office; and (iii) PwC’s Energy and Mining leader for the United States, where she led the firm’s energy and mining assurance, tax and advisory practices. Ms. Carnes currently serves as a director on the Supervisory Board of Core Laboratories N.V. [NYSE: CLB], a Netherlands company (one of the world’s largest providers of reservoir description and production enhancement services to the oil and gas industry), where she is the former Senior Vice PresidentLead Independent Director and Chief Financial Officer of Brunswick Corporation (a global designer, manufacturer and marketer of recreation products), a position he held from September 2008 until his

retirement in February 2013. Mr. Hamilton returned to Brunswick Corporation in September 2008 after retiring from the company in 2007. He was President of the Life Fitness division of Brunswick Corporation from 2005 to 2006 and President of the Brunswick Boat Group from 2006 to 2007. He also served as Vice Chairman of the BoardAudit Committee. She is also a director of Brunswick Corporation from 2000 until his initial retirementMatrix Service Company [NASDAQ: MTRX] (a provider of design, engineering, construction, repair and maintenance services to industrial and energy clients in 2007. He joinedNorth America), where she Chairs the BoardAudit Committee and serves on the Compensation, and Nominating and Corporate Governance committees. She is also a Member Representative for Ohio Valley Midstream, LLC, a member-managed limited liability company engaged in natural gas and natural gas liquids gathering and processing. From September 1, 2017 through June 2019, Ms. Carnes served as a director of DirectorsSunCoke Energy Partners GP LLC, the general partner of Oshkosh Corporation (a designer, manufacturer and marketer of specialty vehicles and vehicle bodies) in 2011 and is the chair of its Audit Committee.SunCoke Energy, L.P., our former master limited partnership.

Mr. HamiltonMs. Carnes is an experienced corporate executive with a background in management, law, finance and government. Prior to joining Brunswick, Mr. Hamilton served in various positions at Cummins Inc., or Cummins (a dieselpublic accounting executive, having spent her entire 34-year career with PwC. By virtue of her experience, Ms. Carnes possesses strategic planning, managerial and natural gas engine designer, manufacturerleadership expertise, having led the design and distributor), including Chief Financial Officer. Prior to his tenure at Cummins, Mr. Hamilton was a partner in a Washington, D.C. law firm, held a numberexecution of senior positionsmarket and sector strategies, business development, compensation, professional development, succession planning, and client satisfaction initiatives for clients in the federal governmentmining, utilities and was an officerenergy industries. In addition, Ms. Carnes brings vast experience with capital markets and financing activities, having served as lead audit partner on some of the largest merger and acquisition transactions completed in the U.S. Navy.energy sector.

 

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Michael G. Rippey

 

Age:  60

Chief Executive Officer and President  63

 

CommitteePresident and Chief Executive Officer

Membership:  Executive

Mr. Rippey was appointed as Chief Executive Officer, President and a director of SunCoke Energy, Inc., effective December 1, 2017. At that time, he also was appointed as Chairman, Chief

Executive Officer and President of SunCoke Energy Partners GP LLC, the general partner of SunCoke Energy Partners, L.P., our sponsored master limited partnership. He joinsPrior to joining SunCoke, most recently fromMr. Rippey served as Senior Advisor to Nippon Steel & Sumitomo Metal Corporation (a leading global steelmaker) where, since 2015, he has served as Senior Advisor.2015. From 2014 to 2015, he served aswas Chairman of the Board of ArcelorMittal USA (a major domestic steel manufacturer), and from August 2006 through October 2014, he was ArcelorMittal USA’s President and Chief Executive Officer. Prior to that, he successfully rose through progressively responsible financial, commercial and administrative leadership roles at ArcelorMittal USA and its predecessor companies: (i) from 2005 to 2006, he was Executive Vice President, Sales and Marketing at Mittal Steel USA; (ii) from 2000 to 2005, he was Executive Vice President and Chief Financial Officer at lspat Inland Inc.; and (iii) from 1998 to 2000, he served as Vice President, Finance and Chief Financial Officer of Ispat Inland Inc. He began his career with Inland Steel Company (a predecessor to ArcelorMittal USA) in 1984. Mr. Rippey currently serves on the Board of Directors of Olympic Steel, Inc. (NASDAQ: ZEUS)[NASDAQ: ZEUS], a $1.1 billion steel(a leading U.S. metals service center headquartered in Ohio,center), where he is a member of the Nominating Committee the Compensation Committee, and serves as Chair of the Audit and Compliance Committee. In addition to ArcelorMittal USA, Mr. Rippey’s previous board service includes the National Association of Manufacturers and the American Iron & Steel Institute, where he was a past Chairman of the Board.

As a veteran industry executive, who has overseen operations of some of the largest and most capital intense assets in the world, Mr. Rippey is an accomplished and financially astute leader with a wealth of finance, sales, operations and management experience in the metals industry. He has dealt successfully with dynamic and challenging business environments and, as a past executive officer and Chairman of ArcelorMittal USA, he has an intimate knowledge and understanding of the challenges and opportunities facing SunCoke as it continues to serve the steel industry.

LOGO

James E. Sweetnam

Age:  65

Committee

Membership:  Compensation, Governance (Chair)

Mr. Sweetnam was elected as a director of SunCoke Energy, Inc. in January 2012. Mr. Sweetnam served as President, Chief Executive Officer and a director of Dana Holding Corporation, or Dana (a motor vehicle parts supplier), from July 2009 until November 2010. From 1997 until June 2009, Mr. Sweetnam served in senior management positions at Eaton Corporation, or Eaton (a global diversified power management company), including as President of the Truck Group from 2001 until June 2009. Prior to joining Eaton, Mr. Sweetnam spent 10 years with Cummins, Inc. (a diesel and natural gas engine designer, manufacturer and distributor) in a variety of senior management positions. He currently serves on the Board of Directors of Republic Airways Holdings, Inc. (an airline holding corporation), where he is a member of its Audit and Compensation Committees. Mr. Sweetnam also serves on the board of LMI (a private,not-for-profit corporation that provides management consulting, research and analysis to governments and other nonprofit organizations), and is a member of its Audit and Governance Committees. From February 2007 until its acquisition by Berkshire Hathaway Inc. in September 2011, Mr. Sweetnam served as a director of Lubrizol Corporation (a specialty chemicals company) and as a member of its Audit, Nominating and Governance, and Organization and Compensation Committees.

Mr. Sweetnam is an experienced corporate executive with senior-level management experience, including service as Chief Executive Officer at Dana, with general operations, manufacturing and engineering experience and a background in international business development and management. Mr. Sweetnam also possesses health, environment and safety oversight experience by virtue of his oversight experience as a senior-level executive at Eaton.

 

THE BOARD OF DIRECTORS AND ITS COMMITTEES

 

 

Our Board of Directors is composed of a majority of independent directors and our Audit, Compensation and Governance Committees are each composed entirely of independent directors. Our Executive Committee is composed of one employee director and one independent director.

The following table shows the membership of our Committees as of March 21, 2018:25, 2021:

 

Name

    Executive          Audit          Compensation          Governance    
          

Michael G. Rippey

*      

John W. Rowe  Arthur F. Anton

Andrew D. Africk

      

Alvin Bledsoe  Martha Z. Carnes

  *    

Peter B. Hamilton  Ralph M. Della Ratta, Jr.

    *  

Susan R. Landahl

      *

  Michael W. Lewis

  

Robert A. Peiser

*

James E. Sweetnam

     *

 

 *

Denotes Committee Chair

Meeting Attendance

The Board of Directors held 1213 meetings in fiscal 2017.year 2020. Each director who served in fiscal 2017year 2020 attended at leastover 75% of the aggregate of: (i) the total number of meetings of the Board of Directors during the periods that he or she served in fiscal 2017;year 2020 and (ii) the total number of meetings of the Committees on which he or she served during the periods that he or she served in fiscal 2017.

Executive Committee

The Executive Committee is composed of Messrs. Rippey and Rowe, and is chaired by Mr. Rippey. The Executive Committee exercises the powers and authority of the Board of Directors to direct the business and affairs of SunCoke Energy in intervals between meetings of the Board of Directors and to implement the policy decisions of the Board of Directors. Actions taken by the Executive Committee are reported to the Board of Directors at its next meeting. There were no meetings of the Executive Committee in fiscal 2017.

The Board of Directors has adopted a written charter for the Executive Committee, which is available on our corporate website atwww.suncoke.com.year 2020.

Audit Committee

All members of the Audit Committee are “independent” as defined in the listing standards of the New York Stock Exchange, (or NYSE)or NYSE, and the rules and regulations of the Securities and Exchange Commission (or SEC)(the “SEC”). The Audit Committee currently is composed of Messrs. BledsoeMs. Carnes, Mr. Della Ratta and Hamilton and Ms. Landahl,Mr. Lewis, and is chaired by Mr. Bledsoe.Ms. Carnes. The Board of Directors has determined that Messrs. Bledsoe and Hamilton and Ms. Landahl,members of the Audit Committee are independent directors for purposes of serving on an audit committee under applicable SEC and NYSE requirements, and each is financially literate and has accounting or related financial management expertise as required by the applicable rules of the NYSE. The Board also has determined that each of Ms. Carnes and Messrs. BledsoeDella Ratta and Hamilton qualifiesLewis qualify as an “audit committee financial expert” as defined by the applicable rules of the SEC.

The Audit Committee assists the Board of Directors in (1) the appointment, evaluation and compensation of the Company’s independent auditor, (2) the review and monitoring of the Company’s financial statements and disclosures,(3) pre-approval of audit services, internal control-related services and permittednon-audit services, (4) oversight and monitoring of the Company’s internal audit function and independent auditors, and (5) monitoring compliance by the Company with legal and regulatory requirements, including the Company’s Code of Business Conduct and Ethics.Ethics; and (6) oversight of the Company’s information technology use and protection including, but not limited to enterprise cybersecurity and privacy.

The Board of Directors has adopted a written charter for the Audit Committee, which is available on our corporate website atwww.suncoke.comwww.SunCoke.com. The Audit Committee met nineeight times in fiscal 2017.year 2020.

Compensation Committee

The Compensation Committee is composed of Messrs. Africk, PeiserMr. Anton, Mr. Della Ratta and SweetnamMs. Landahl, and is chaired by Mr. Peiser.Della Ratta. The Compensation Committee is responsible for the approval, evaluation and oversight of all compensation plans, policies and programs for the executive officers and certain other employees of SunCoke Energy and its subsidiaries. The Compensation Committee also has sole authority over the appointment, evaluation and compensation of any independent compensation consultant it uses in the evaluation of executive officer compensation.

The Board of Directors has adopted a written charter for the Compensation Committee, which is available on our corporate website atwww.suncoke.comwww.SunCoke.com. The Compensation Committee met four times in fiscal 2017.year 2020.

Governance Committee

The Governance Committee currently is composed of Messrs. Hamilton, RoweMr. Anton, Mr. Lewis and Sweetnam and MsMs. Landahl, and is chaired by Mr. Sweetnam.Ms. Landahl. The Governance Committee (1) assists the Board in identifying individuals qualified to become Board members, (2) recommends to the Board director nominees to be considered by stockholders, (3) recommends Corporate Governance Guidelines to the Board, (4) leads the Board in its annual review of Board performance, (5) recommends to the Board nominees for each Board committee, and (6) reviews the form and amount of director compensation and makes recommendations to the Board regarding the Company’s director compensation program.program, and (7) provides oversight of the Company’s on-going environmental, health, sustainability and corporate social responsibility policies, initiatives, objectives and practices.

The Board of Directors has adopted a written charter for the Governance Committee, which is available on our corporate website atwww.suncoke.comwww.SunCoke.com. The Governance Committee met twosix times in fiscal 2017.year 2020.

Compensation Committee Interlocks and Insider Participation

None of the members of the Compensation Committee is or ever was an officer or employee of SunCoke Energy or any of our subsidiaries. In addition, none of our executive officers served on the compensation committee or board of directors of any other company of which any of our directors also was an executive officer.

 

CORPORATE GOVERNANCE

 

 

Corporate governance at SunCoke Energy is designed to promote the long-term interests of our stockholders, strengthen Board and management accountability, foster responsible decision-making and engender public trust. We have adopted leading governance practices that establish strong independent leadership in our boardroom and provide our stockholders with meaningful rights.

We believe that strong corporate governance practices that provide meaningful rights to our stockholders and ensure Board and management accountability are essential to our long-term success. The following are key governance provisions that highlight SunCoke Energy’s commitment to transparency and accountability:

Strong Board independence

(5 out of 6 directors are independent)

Fully independent Audit, Compensation and Governance Committees

Independent Chairman with robust responsibilities

Annual Board and Committee self-evaluations

Separate independent Chairman and CEO roles

Robust stock ownership requirements for executive officers and directors

Majority vote standard for uncontested election of directors

Strong stockholder engagement practices

Limitations on outside board and audit committee service

Greater than 75% attendance at Board

& Committee meetings

Non-employee directors meet in executive session without management present

Code of Business Conduct & Ethics applicable to directors and executive officers

Board oversight of sustainability matters and transparency through comprehensive annual ESG/Sustainability report addressing environmental and social impact and responsible business practices

Demonstrated focus on, and commitment to, ongoing Board refreshment

Director Independence

The Board, of Directors, upon the recommendation of the Governance Committee, has determined that each of ournon-management directors who serves as a director is “independent” under the applicable rules of the NYSE and the SEC and is free of any direct or indirect material relationship with SunCoke Energy or its management.

Board Leadership Structure

Our Board of Directors currently separates the roles of Chairman and Chief Executive Officer. The current leadership structure of the Board of Directors includes our independentnon-executive Chairman (Mr. Rowe)Anton), and our President and Chief Executive Officer (Mr. Rippey). Our Governance Committee and Board of Directors has determined

believes that the current boardBoard leadership structure, with separate roles for the Chairman and the Chief Executive Officer is in the best interests of SunCoke Energy and its stockholders at the present time. AIn our view, a number of factors support the current leadership structure chosen by the Board, including, among others:

 

Separating these two roles increases the Board’s independence from management and leads to better monitoring and oversight, thus reducing the potential for actual or perceived conflicts of interest related to executive compensation, performance and succession.

 

The Chairman provides independent oversight, presiding over the meetings of our Board of Directors (including sessions with only independent directors present) and coordinating the work of the standing Committees of our Board.

 

The Chairman serves as a liaison between our Board and senior management, but having an independent Chairman enablesnon-management directors to raise issues and concerns for Board consideration without immediately involving management.

 

This governance structure promotes a balance between the Board’s independent authority to oversee our business and the Chief Executive Officer and his management team who manage the business on aday-to-day basis.

 

Separating the roles of Chairman and Chief Executive Officer promotes overall board independence, allowing the Chief Executive Officer to focus his time and energy on the everyday demands of managing our business successfully (including strategy and operations), while at the same time leveraging the experience and perspectives of the Chairman.

Our Governance Committee annually assesses these roles and the board leadership structure to ensure that the interests of SunCoke Energy and its stockholders are best served. OurBy-laws allow the Chief Executive Officer to be designated as Chairman of the Board. If the individual elected as Chairman of the Board is also the Chief Executive Officer, or if the Chairman of the Board is otherwise not independent, then the ChairmanChair of our Governance Committee will act in the role of Lead Director. The duties of such a Lead Director are described in our Corporate Governance Guidelines, and include: (1) the authority to chair those meetings of the Board of Directors at which the Chairman is not present; and (2) the authority to preside at executive sessions of the independent directors. A Lead Director also may provide advice and counsel, as needed, to the Chairman, and/or the Chief Executive Officer, on strategic issues and on Board of Directors and Committee matters generally. If appointed, a Lead Director also would lead the Board and Committee self-evaluation process, as well as the annual evaluation of the Chief Executive Officer by the independent directors.

Except for our Chief Executive Officer, Mr. Rippey, our Board of Directors is composed entirely of independent directors. The Audit, Compensation and Governance Committees are composed solely of independent directors.

Director QualificationsRisk Oversight

The Governance Committee annually reviewsOur Board has an active role, both as a whole and also at the qualificationscommittee level, in overseeing management of the Company’s risks, including financial risks, cybersecurity risks, credit and experience of current directorsliquidity risks, legal and identifies specific competencies required in director-nominees. Director-nominees should have a proven record of professional successregulatory risks and leadership and demonstrate the highest personal and professional ethics, integrity and values.operational risks. The Board is responsible for general oversight of Directors also considers ethnicrisks and gender diversity. Directors also are expectedregularly reviews information from management who is responsible for the day-to-day processes and operations to devote sufficient time and effort to their duties as members of the Board of Directors.

Risk Oversightmanage risks.

In accordance with NYSE requirements, the Audit Committee charter provides that the Audit Committee is responsible for reviewing and discussing SunCoke Energy’s major financial risk exposures and the steps management has taken to monitor and control such exposures, including our risk assessment and risk management policies. On a regular basis, our officers who are responsible for

monitoring and managing SunCoke Energy’s risks, including our Chairman, President and Chief Executive Officer, our Senior Vice President and Chief Financial Officer and our Senior Vice President, General CounselChief Legal Officer and Chief ComplianceHuman Relations Officer, make reports to the Audit Committee. The Audit Committee, in turn, reports to the full Board of Directors. While the Audit Committee has primary responsibility for overseeing risk management, our entire Board of Directors is actively involved in overseeing risk management by engaging in periodic discussions with our officers as it may deem appropriate. In addition, each of our Committees considers the risks within its areas of responsibility. For example, the Audit Committee focuses on risks inherent in our accounting, financial reporting and internal controls, and the Compensation Committee considers the risks that may be implicated by our executive compensation program. The Compensation Committee’s assessment of risk related to compensation practices is discussed in more detail in the Compensation Discussion and Analysis section of this proxy statement.Proxy Statement. We believe that the leadership structure of our Board of Directors supports its effective oversight of our risk management.

Executive SessionsCybersecurity and Information Security Risk Oversight

Our Board recognizes the importance of Directorsmaintaining the trust and confidence of our customers, suppliers, vendors, contractors and employees, and devotes significant time and attention to oversight of cybersecurity and information security risk. In particular, our Audit Committee receives regular reporting on cybersecurity and information security risks. The Board and the Audit Committee receive presentations throughout the year on cybersecurity and information security topics. In 2021, we updated our Audit Committee charter to make explicit the Committee’s responsibility for reviewing cybersecurity matters and information security risks as well as the steps taken by management to identify, assess and mitigate such risks. At least twice each year, the Audit Committee and the Board discuss cybersecurity and information management risks with the Company’s Chief Information Officer.

Management has continued to take significant steps to enhance our data security infrastructure and defenses. These enhancements include new and improved technical controls and procedures, additional use of outside third party experts and independent cybersecurity advisors, and periodic review of the Company’s cyber insurance policies to ensure appropriate coverage.

Sustainability Matters

Our Board recognizes the importance of sustainability and is actively engaged in overseeing the Company’s sustainability practices and works alongside management to ensure focus on these matters. As part of this ongoing focus, in 2020, the Board amended the charter of our Governance Committee to provide broad oversight of the Company’s policies, initiatives, objectives and practices regarding environmental matters, climate change, health and corporate social responsibility. The Governance Committee receives updates from management and considers stakeholder concerns regarding current and emerging sustainability matters that may affect the business, operations, performance, or public image of the Company, and reviews such matters with the Board and management, as appropriate. We continue to incorporate sustainability into our businesses’ core strategy, reflecting our belief that sustainability is essential to long-term growth. We also believe in transparency, and report on our sustainability efforts in an annual Sustainability Report which discusses our programs and policies designed to promote ethical business practices, good corporate governance, and the well-being and health of our environment, employees, and the communities in which we live and work.

Executive Sessions of the Board

Our Board holds regular executive sessions in which the independent directors meet without any members of management present. The purpose of these executive sessions is to promote open and

candid discussion among the independent directors. In accordance with applicable NYSE rules, ournon-executive Chairman presides over the executive sessions of the independent directors. The independent directors met in executive sessions separate from management eightfive times during fiscal 2017.2020.

Corporate Governance Guidelines

Our Board of Directors has adopted Corporate Governance Guidelines that address the following matters, among others: (1) Boardcomposition of Directors compositionthe Board and director qualifications; (2) operations of the Board of Directors;Board; (3) responsibilities of the Board of Directors;Board; and (4) Committee structure and responsibilities. These Corporate Governance Guidelines are posted on our corporate website atwww.SunCoke.com.

Insider Trading Policy Restrictions on Hedging & Pledging

SunCoke Energy’s Insider Trading Policy applies to our employees, executives, including our named executive officers (“NEOs”), and the members of our Board. The Insider Trading Policy prohibits trading in SunCoke Energy securities except during specifically designated windows, and also prohibits certain types of trading activities whether or not they technically involve insider trading. SunCoke Energy considers it inappropriate for any director, officer or other employee to enter into speculative hedging or monetization transactions involving SunCoke Energy securities. In general, such transactions are designed to offset or reduce the risk of price fluctuations in the underlying security and, as such, sever the ultimate alignment with our stockholders’ interests. Under our Insider Trading Policy, no employee, officer, or director of SunCoke Energy may, either directly or indirectly through a third party, enter into short sales or purchase, sell or exercise any puts, calls or similar instruments pertaining to securities of the SunCoke Companies (other than options exercised in accordance with the terms of an option plan sponsored by the SunCoke Companies) or engage in hedging activities of any kind (www.suncoke.come.g., covered calls, collars, equity swaps, prepaid variable forwards, and exchange funds) pertaining to any SunCoke Energy securities, in each case because of the potential conflict of interest or the perceptions created, and the resulting possible impact on the market. Additionally, no employee (including any officer) or director of SunCoke Energy may pledge any SunCoke Energy securities as collateral for any loan or deposit, or hold any such securities in a margin account, since a foreclosure sale or margin sale could occur at a time when the pledgor is aware of material non-public information, or otherwise not permitted to trade in SunCoke Energy securities.

Review of Related Person Transactions

The Board of Directors has adopted a written policy that applies to interested transactions with related parties. For purposes of the policy, interested transactions include transactions, arrangements or relationships involving amounts greater than $100,000 in the aggregate in which the Company is a participant and a related person has a direct or indirect interest. Related persons are deemed to include executive officers, directors, director-nominees, owners of more than five percent of our common stock or an immediate family member of the preceding group. The policy provides that the Governance Committee is responsible for the review and approval of all such related person transactions.

The Governance Committee reviews the material facts of all interested transactions that require its approval and either approves or disapproves of the entry into the interested transaction, subject to certain exceptions described below. The policy prohibits any director from participating in any discussion or approval of an interested transaction for which such director is a related person, except that such director is required to provide all material information concerning the interested transaction to the Governance Committee. As part of its review and approval of a related person transaction, the Governance Committee considers, among other things, whether the transaction is made on terms no less favorable than terms that would be generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related person’s interest in the transaction.

Our related person transactions policy also provides that certain interested transactions will have standingpre-approval from the Governance Committee. These include: (1) employment of executive officers if the compensation is disclosed in the proxy statement or approved by the Board of Directors or the Compensation Committee; (2) employment of an immediate family member of a director, director nominee or executive officer with compensation that does not exceed $120,000; (3) director compensation that is disclosed in the proxy statement; (4) transactions with companies where the business is less than the larger of $1 million or two percent of the other company’s total revenues; (5) certain charitable contributions; (6) transactions where all stockholders receive proportional benefits; (7) transactions involving competitive bids; (8) regulated transactions; (9) certain banking services; and (10) certain transactions available to all employees or third parties generally.

Director Attendance Policy

Directors are expected to attend the Board of Directors meetings and meetings of Committees on which they serve, as well as our annual meeting of stockholders. With the exception of Mr.  Africk, all the directors attended our annual meeting of stockholders in fiscal 2017.

Indemnification Agreements

Our directors are asked to enter into individual Indemnification Agreements with SunCoke Energy when joining the Board of Directors.Board. The Indemnification Agreement is the same for each director and provides contractual indemnification in addition to the indemnification provided in our Amended and Restated Certificate of Incorporation and Amended and Restatedthe By-laws. The Indemnification Agreement provides each director with indemnification to the fullest extent permitted by law. Subject to certain limitations and exceptions, the Indemnification Agreement provides, among other things, that we will indemnify each director against expenses, liabilities, losses, judgments, fines and amounts paid in settlement incurred in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that the director is or was our director or by reason of the fact that the director is or was serving at our request as a director, officer, manager, trustee, fiduciary, employee or agent of another entity, with certain stated exceptions. In addition, under the Indemnification Agreement, we are obligated to advance payment to each director for all expenses reasonably incurred by such director with respect to the events or occurrences specified above, provided that the director must repay the advanced expenses to the extent that it is ultimately determined that the director is not entitled to indemnification under the terms of the Indemnification Agreement.

Code of Business Conduct and Ethics

We have adopted a Code of Business Conduct and Ethics that applies to all of our officers, directors and employees, including our Chairman, President and Chief Executive Officer, Senior Vice President and Chief Financial Officer, Vice President and Controller and other senior financial officers. The Code of Business Conduct and Ethics is posted on our corporate website atwww.suncoke.comwww.SunCoke.com.

Oversight of Management Succession

The Company has adopted a management succession policy pursuant to which the Board of Directors regularly reviews the Company’s succession plan for the CEO and other senior executives. This process is designed to prepare the Company for both planned succession events as well as unplanned succession events, such as those arising from unexpected illness or death or other sudden departure, to ensure the stability and accountability of the Company during periods of transition. The Board of Directors’ periodic review of the Company’s succession plan includes an evaluation of potential candidates for the CEO position and other senior executive positions, including an assessment of whether each candidate possesses the skills, experience, education, and other attributes that the Board of Directors believes to be required for such positions in light of the

Company’s business, operations, strategy and culture. The Company’s management succession policy also provides process guidelines in the event of an emergency management succession event.

Board of Directors and Committee Evaluations

Our Board recognizes that a robust and constructive Board and committee evaluation process is an essential component of board effectiveness. As such, our Board and each of our committees conduct an annual evaluation, which includes a qualitative assessment by each director of the performance of the Board and the committee or committees on which the director sits. The Governance Committee oversees the evaluation process.

The results of these annual self-evaluations have led to changes aimed at improving the Board’s effectiveness, including the appropriate distribution of oversight responsibilities across the various committees of the Board, the conduct of executive sessions, and considerations of the type and content of information included in meeting materials.

Communications with the Board

Stockholders and other interested persons may communicate any concerns they may have regarding SunCoke Energy to the attention of the Board of Directors or to any specific member of the Board, of Directors, including the Chairman, by writing to the following address:

SunCoke Energy, Inc.

c/o Corporate Secretary

1011 Warrenville Road, Suite 600

Lisle, Illinois 60532

Communications directed to the independent directors as a group should be sent to the attention of the Chairman, c/o the Corporate Secretary, at the address indicated above. Any stockholder or other interested person who has a particular concern regarding accounting, internal accounting controls or other audit matters that he or she wishes to bring to the attention of the Audit Committee of the Board of Directors may communicate those concerns to the Audit Committee or its Chair, c/o the Corporate Secretary, using the address indicated above.

Governance Committee Process for Director Nominations

The Governance Committee evaluates potential director candidates and makes recommendations to the Board of Directors. Candidates may be identified by current directors, by a search firm or by stockholders. The Governance Committee may engage the services of a third-party consultant to assist in identifying and screening potential candidates. The Governance Committee’s evaluation of a candidate generally includes inquiries as to the candidate’s reputation and background, examination of the candidate’s experience and skills in relation to the Board of Director’s requirements at the time, consideration of the candidate’s independence as measured by the Board of Director’s independence standards and any other considerations that the Governance Committee deems appropriate. Candidates should have a proven record of professional success and leadership and demonstrate the highest personal and professional ethics, integrity and values. Ethnic and gender diversity also are considered. At least annually, the Governance Committee reviews the criteria for the nomination of director candidates and approves changes to the criteria, as appropriate. Following its evaluation process, the Governance Committee recommends candidates to the full Board of Directors. The Board of Directors makes the final determination regarding a candidate based on its consideration of the Governance Committee’s recommendation. Candidates recommended by our stockholders will be evaluated on the same basis as candidates recommended by current directors, search firms, or third-party consultants.

Oversight of Management Succession

The Company has adopted a management succession policy pursuant to which the Board of Directors regularly reviews the Company’s succession plan for the CEO and other senior executives. This process is designed to prepare the Company for both planned succession events, such as Mr. Henderson’s recent retirement as CEO in 2017, as well as unplanned succession events, such as those arising from unexpected illness or death or other sudden departure, to ensure the stability and accountability of the Company during periods of transition. The Company’s management succession policy reflects the thorough process utilized during the Company’s recent transition from Mr. Henderson to Mr. Rippey as CEO. The Board of Directors’ periodic review includes an evaluation of potential candidates for the CEO position and other senior executive positions, including an assessment of whether each candidate possesses the skills, experience, education, and other attributes that the Board of Directors believes to be required for such positions in light of the Company’s business, operations, strategy and culture. The Company’s management succession policy also provides process guidelines in the event of an emergency management succession event.

 

DIRECTOR COMPENSATION

 

 

The compensation program for our independent directors is designed to attract experienced and highly qualified directors, provide appropriate compensation for their time, efforts, commitment and contributions to SunCoke Energy and our stockholders and align the interests of the independent directors and our stockholders.

Annual Retainer

SunCoke Energy does not pay meeting fees. The table below summarizes the current structure of ourthe independent director compensation program for SunCoke Energy’s independent directors, with the exception of Mr. Bledsoe, whose compensation is described in further detail below:directors:

 

BOARD SERVICE

        

Annual Retainer (Cash Portion)

  $70,000   $80,000 

Annual Retainer (Stock Portion)

  $    110,000   $    115,000 

COMMITTEE SERVICE

        

Annualnon-executive Chairman Retainer

  $80,000   $80,000 

Annual Lead Director Retainer (if applicable)

  $30,000   $30,000 

Annual Committee Chair Retainers:

    

• Audit Committee Chair

  $25,000   $25,000 

• Compensation Committee Chair

  $15,000   $15,000 

• All Other Committee Chairs

  $10,000   $10,000 

Annual Audit Committee Member Retainer

  $10,000   $10,000 

Retainer Stock Plan

The SunCoke Energy, Inc. Retainer Stock Plan for Outside Directors, or Retainer Stock Plan, provides for the payment of a portion of the independent directors’ annual retainer in the form of our common stock. The Retainer Stock Plan also allows each independent director to elect to receive payment of all or a portion of his or her cash retainer(s) in the form of our common stock. Payments pursuant to the Retainer Stock Plan are made quarterly in the number of shares of our common stock determined by dividingone-fourth of the aggregate portion of the annual retainer payable in our common stock by the average closing price for a share of our common stock for the ten trading days on the NYSE immediately prior to the payment date.

Director’s Deferred Compensation Plan

The SunCoke Energy, Inc. Directors’ Deferred Compensation Plan, or Directors’ Deferred Compensation Plan, permits independent directors to defer a portion of their stock and cash compensation. Each independent director has the option to designate his or her deferred compensation as share units, cash units or a combination of both. Cash units accrue interest at a rate set annually by the Governance Committee. A share unit is treated as if it were invested in shares of our common stock, but it does not have voting rights. If share units are chosen, dividend equivalents are credited in the form of additional share units. Payments of compensation deferred under the Directors’ Deferred Compensation Plan will be made at, or commence on, January 15 of the calendar year following the calendar year in which an independent director ceases to provide services to SunCoke Energy, with any successive annual installment payments to be made no earlier than January 15 of each such year. Share units are settled in cash based upon the average closing price for a share of our common stockCommon Stock for the ten trading days on the NYSE immediately prior to the payment date.

Director Stock Ownership Guidelines

Each independent director is expected to own a number of shares of our common stock having an aggregate market value equal to at least five times the independent director’s annual cash retainer. SunCoke common share units that are credited to an independent director’s deferred compensation account under the Directors’ Deferred Compensation Plan will be counted for purposes of determining compliance with these guidelines. Once the applicable guideline ownership level has been attained, compliance will not otherwise be affected by a subsequent decline in the trading price of SunCoke common stock.Common Stock. Our directors are allowed a five-yearphase-in period to reach their respective stock ownership goals in order to comply with the applicable guidelines. As of December 31, 2017,2020, all of our independent directors were in compliance with the guidelines. Messrs. Africk and Peiser were appointed as independent directors effective March 7, 2016, and Ms. Landahl was appointed as an independent director effective September 1, 2017.2017, Ms. Carnes was appointed as an independent director as of December 5, 2019, Mr. Anton was appointed as an independent director, effective March 17, 2020, and Messrs. Della Ratta and Lewis each were appointed as an independent director as of December 3, 2020. Each of Messrs. AfrickMs. Landahl, Ms. Carnes, Mr. Anton, Mr. Della Ratta and Peiser and Ms. LandahlMr.  Lewis will have five years from their respective appointments to the Board in which to meet their respective stock ownership goals.

Director Compensation Table

The following table sets forth the compensation for ourpaid by SunCoke Energy, Inc. to its independent directors in fiscal 2017:2020:

 

Name

 Fees
Earned or
Paid in
Cash
($) (1)
 Stock
Awards
($) (2)
  Option
Awards
($)
  Non-Equity
Incentive Plan
Compensation
($)
  Nonqualified
Deferred
Compensation
Earnings
($)
  All Other
Compensation
($) (3)
  Total
($)
 
                     

Andrew D. Africk

   70,000      110,000                 180,000     

Alvin Bledsoe(4)

   90,333      102,667                 193,000     

Robert J. Darnall(5)

   29,011      39,890              2,217   71,118     

Peter B. Hamilton

   76,667      110,000                 186,667     

Susan R. Landahl(6)

   23,333      36,667                 60,000     

Karen B. Peetz(7)

          —      —                 —     

Robert A. Peiser(4)

   85,000  110,000                 195,000     

John W. Rowe(4)

 110,000  110,000                 220,000     

James E. Sweetnam

   80,000  110,000              14,637   204,637     

Name

 Fees
Earned or
Paid in
Cash
($) (1)
  Stock
Awards
($) (2)
  Option
Awards
($)
  Non-Equity
Incentive Plan
Compensation
($)
  Nonqualified
Deferred
Compensation
Earnings
($)
  All Other
Compensation
($)
  Total
($)
 
                      

  Arthur F. Anton

  69,148    91,305        160,453  

  Alvin Bledsoe

  105,000    115,000        220,000  

  Martha Z. Carnes

  90,000    115,000        205,000  

  Robert J. Darnall (3)

  —    —                —  

  Ralph M. Della Ratta, Jr.

  3,591    13,175        16,766  

  Peter B. Hamilton (4)

  46,154    50,549        96,708  

  Susan R. Landahl

  90,000    115,000        205,000  

  Michael W. Lewis

  7,183    9,583        16,766  

  John W. Rowe (5)

  160,000    115,000        275,000  

  James E. Sweetnam

  90,000    115,000                    205,000  

 

(1)

The amounts in this column include all cash retainers paid, or deferred pursuant to the Directors’ Deferred Compensation Plan. Mr. Sweetnam deferred his cash compensation into the Directors’ Deferred Compensation Plan in the form of cash units, credited with interest at an annual rate of 3.31%3.78%.

 

(2)

The amounts in this column represent the grant date fair value of the stock retainer payments paid to each director in fiscal 20172020 as of the date of each quarterly payment, calculated pursuant to FASB ASC Topic 718. The number of shares granted to eachnon-employee director was determined by dividing the $27,500applicable quarterly stock retainer payment by the average closing price of a share of common stock for the ten trading days preceding the date of grant. Messrs.

Anton, Bledsoe, Rowe, Lewis and Sweetnam, and Ms.Mss. Carnes and Landahl each deferred their respective stock retainers into the Directors’ Deferred Compensation Plan.

 

(3)

Amounts shown in this column reflect interest credited on deferred cash account balances in the SunCoke Energy, Inc. Directors’ Deferred Compensation Plan.

(4)

On September 1, 2017, Mr. Bledsoe was appointed to chair the Audit Committee of SunCoke Energy Partners GP LLC, the general partner of SunCoke Energy Partners, L.P., our sponsored master limited partnership, whose common units representing limited partner interests, are publicly traded on the NYSE. Mr. Bledsoe also will continue to serve in his current role as Chair of SunCoke Energy’s Audit Committee.

In connection with his appointment to the Audit Committee of SunCoke Energy Partners GP LLC, Mr. Bledsoe became eligible to participate in the SunCoke Energy Partners, L.P. Long-Term Incentive Plan, as an independent director of the general partner. As a consequence, Mr. Bledsoe receives an equity retainer paid pursuant to such plan.

The table below sets forth the total value of Mr. Bledsoe’s combined annual independent director compensation, showing the allocation of payments from each of SunCoke Energy and our master limited partnership’s general partner:

   SunCoke Energy Partners
GP LLC (“SXCP GP”)
  SunCoke Energy, Inc.
(“SunCoke”)

•    Annual Retainer (Cash Portion)

  $52,000  $56,000

•    Annual Retainer (Equity Portion)

  $68,000  $88,000

SUBTOTAL (Base Retainers Only)

  $120,000  $144,000

•    Audit Committee

     Chair Retainer (Cash)

  $20,000  $25,000

TOTAL

  $140,000  $169,000

(5)

Mr. Darnall retired from SunCoke Energy’sthe Board of Directors effective May 4, 2017. Figures in the foregoing table reflect the prorated amount of his compensation earned during the first half of 2017. During his tenure on our Board, of Directors, Mr. Darnall had elected to defer a portion of his compensation into the Directors’ Deferred Compensation Plan, in the form of share units. Upon his retirement from the Board, Mr. Darnall elected to convert the entire balance of these share units into cash units, pursuant toPlan. In accordance with the terms of the Directors’ Deferred Compensation Plan. The converted share units were valued using the average closing price of a share of SunCoke Energy common stock for the ten trading days preceding the effective date of thisone-time conversion election. In accordance with his deferred compensation payoutsuch election, Mr. Darnall will receiveis receiving payment in cash, in three successive and approximately equal annual installments, of the compensation credited to his deferred compensation account. The first of these threethird and final cash installment paymentspayment to Mr. Darnall, in the amount of $34,231.59,$36,640.08, was made on January 22, 2018.16, 2020.

 

(6)(4)

Ms. Landahl was appointed as an independent director,Mr. Hamilton retired from the Board effective September 1, 2017. Figures in the foregoing table reflect the prorationJune 8, 2020. During his tenure on our Board, Mr. Hamilton did not elect to defer any of the cash and stock compensation earned by Ms. Landahl during the third quarter of 2017.his compensation.

 

(7)(5)

Ms. Peetz resigned from SunCoke Energy’sMr. Rowe retired as a member of our Board, and as non-executive Chairman, effective as of DirectorsDecember 31, 2020, and Mr. Anton was appointed as non-executive Chairman, effective February 18, 2016.as of January 1, 2021. During herhis tenure on our Board, of Directors, Ms. PeetzMr. Rowe had elected to defer both her cash and stocka portion of his compensation into the Directors’ Deferred Compensation Plan. In accordance with the terms of such election, Ms. Peetz will receiveupon termination of his service on our Board, Mr. Rowe received a lump sum cash payment in cash, in three successive and approximately equal annual installments, of the compensation credited to herhis deferred compensation account. The second of these three cash installment payments to Ms. Peetz,This payment, in the amount of $268,850.27,$651,698.69, was made on January 22, 2018. During 2017, Ms. Peetz’ deferred cash account was credited with interest of $7,961.15, 2021.

 

PROPOSAL 2 — APPROVAL OF AMENDMENTS TO CERTIFICATE OF

INCORPORATION AND BY-LAWS

The Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) and its Amended and Restated By-laws (the “By-laws”) currently provide for a board of directors divided into three classes, with the number of directors in each class being as nearly equal as reasonably possible. Accordingly, approximately one-third of the directors are elected annually, each serving a three-year term. This structure was put in place by the Company’s former parent company at the time of the initial public offering and spin-off of the Company in 2011, to provide the stability and continuity for the Company to develop and implement the best long-term strategic course.

However, following a constructive dialogue with Nokomis Capital, LLC (“Nokomis”), a stockholder of the Company, the Board agreed to present a proposal to stockholders at the Company’s 2020 annual meeting of stockholders to amend the Company’s Certificate of Incorporation and By-laws to provide for declassification of the Board and annual election of directors. The Company also agreed with Nokomis that, if such amendments were not approved by the holders of at least 80 percent of the Company’s common stock, then the Company would present the same amendments to its stockholders again at the Company’s 2021 annual meeting of stockholders (the “2021 Annual Meeting”). These amendments were not approved by the requisite vote of stockholders. Therefore, pursuant to its arrangement with Nokomis, the Company is presenting these amendments for approval by stockholders at this meeting.

Description of the Proposed Declassification Amendments

Subject to approval by stockholders at this meeting, the Board has adopted, amendments to the Company’s Certificate of Incorporation and By-laws to effectuate the declassification of the Board following the 2021 Annual Meeting. To facilitate declassification of the Board in a timely manner following approval of these amendments by holders of at least 80 percent of the Company’s common stock, all of the directors then in office will resign immediately prior to the Company’s 2022 annual meeting of stockholders (the “2022 Annual Meeting”), such that each member of the Board will serve a one-year term following the 2021 Annual Meeting and stand for election annually, beginning at the 2022 Annual Meeting. The proposed amendments provide that each director elected at each annual meeting of stockholders, beginning with the 2022 Annual Meeting, will serve a one-year term expiring at the following annual meeting of stockholders and until his or her respective successor is duly elected and qualified, or until his or her earlier death, resignation, disqualification or removal.

Under Delaware law, directors of companies that have a classified board of directors may be removed only for cause, unless the certificate of incorporation provides otherwise. Delaware law provides that directors of companies that do not have a classified board may be removed with or without cause by a majority vote of the stockholders at any annual or special meeting of stockholders. Accordingly, if the proposed amendments are approved, any director elected at or after the 2021 Annual Meeting may be removed from office at any time, with or without cause, by the affirmative vote of the holders of a majority of the shares then entitled to vote at an election of directors, voting together as a single class.

Reasons for Declassifying the Board

The Board considered a number of factors that favor continuing with a classified board structure, as well as a number of factors that favor adopting a declassified board structure. Ultimately, after weighing the various factors, the Board determined that it would be in the best interests of the Company and our stockholders to amend our Certificate of Incorporation and By-laws. For this reason, the Board approved and declared advisable the amendment and restatement of our Certificate of

Incorporation, giving effect to the de-classification amendments included in the Certificate of Amendment that is attached hereto and incorporated by reference herein as Appendix A. In addition, the text of the de-classification amendments to our By-laws is attached hereto as Appendix B and incorporated by reference herein.

If approved by stockholders, the proposed amendments to our Certificate of Incorporation and By-laws would become effective upon the filing of a Certificate of Amendment with the Secretary of State of the State of Delaware, which we would file promptly following the 2021 Annual Meeting of Stockholders. After filing the Certificate of Amendment to effectuate the declassification of our Board, each director will resign immediately prior to the 2022 Annual Meeting, in order to stand for election at the 2022 Annual Meeting, and thereafter, for a one-year term. The proposed amendments would not change the present number of directors, or the Board’s authority to change that number and to fill any vacancies or newly created directorships.

Vote Required

Approval of the adoption of the amendments to the Company’s Certificate of Incorporation and By-laws to eliminate the classified Board requires the affirmative vote of the holders of at least 80 percent of the common stock of the Company issued and outstanding as of the Record Date for the 2021 Annual Meeting.

RECOMMENDATION

The Board unanimously recommends that you vote “FOR” approval of the amendments to our Certificate of Incorporation and By-laws to declassify our Board and allow for annual election of directors.

EXECUTIVE COMPENSATION

 

 

Compensation Committee Report

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis (“CD&A”) section of this proxy statement with management. Based on our review and discussion with management, we have recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and incorporated in the Annual Report on Form10-K for the year ended December 31, 2017.2020.

Members of the Compensation Committee:

 

Robert A. Peiser (Chair)Ralph M. Della Ratta, Jr. (current Chair)

Arthur F. Anton

Susan R. Landahl

 

James E. Sweetnam

Andrew D. Africk (former Committee Member & Chair)

Compensation Discussion and Analysis (“CD&A”)

The followingThis CD&A describes the material elements of the 20172020 compensation and benefit programs for our named executive officers, or NEOs. Our NEOs for 2017,2020, which consist of those executive officers who appear in the Summary Compensation Table, were:

 

 (1)

Frederick A. Henderson, Chairman,Michael G. Rippey, President and Chief Executive Officer from January 1, 2017 through November 30, 2017; and Executive Chairman from December 1, through December 31, 2017;Officer;

 

 (2)

Michael G. Rippey, President and Chief Executive Officer effective December 1, 2017;

(3)

Fay West, Senior Vice President and Chief Financial Officer;

(3)

Katherine T. Gates, Senior Vice President, Chief Legal Officer and Chief Human Resources Officer;

 

 (4)

P. Michael Hardesty, Senior Vice President Commercial Operations, Business Development, Terminals and International Coke;

 

 (5)

Katherine T. Gates, SeniorJohn F. Quanci, Vice President, General Counsel and Chief Compliance Officer; and

(6)

Gary P. Yeaw, Senior Vice President, Human Resources.Technology Officer

The CD&A is organized into six sections:

SECTION 1 -- EXECUTIVE SUMMARY

SECTION 2 -- OUR COMPENSATION PHILOSOPHY

SECTION 3 -- ELEMENTS OF EXECUTIVE COMPENSATION

SECTION 4 -- ROLE OF MANAGEMENT, COMPENSATION CONSULTANTS AND

                             USE OF MARKET DATA

SECTION 4 -- ELEMENTS OF EXECUTIVE COMPENSATION

SECTION 5 -- PAY MIX, OPPORTUNITY AND LEVERAGE

SECTION 6 -- OTHER COMPENSATION INFORMATION

SECTION 1 -- EXECUTIVE SUMMARY

2017 was a yearSunCoke Energy’s financial results in 2020 were driven by successful contract extensions for three of improvement for SunCoke in an environment that saw gradual improvementour domestic coke plants, as well as significant Company-wide savings initiatives. The vast majority of our Adjusted EBITDA is based on take-or-pay contracts with our steel customers. These contracts require purchase of certain volumes of coke at established prices or, in the steel and coal markets. Adjusted EBITDA for 2017 was $234.7 million, an 8% improvement over 2016 and atevent that the higher end of our guidance to investors. Operating Cash Flow of $148.5 million, although lower than an exceptional year in 2016, remained strong.

Our domesticcustomer is unable to take the coke, making operations produced operating results in line with expectations. The impacts associatedrequire payment for the coke at the same price. Because of the contractual obligations of our take-or-pay coke contracts with our continuedsteel customers, the economic fallout from the COVID-19 impact would not have otherwise impacted our financial results. Our steel customers, however, were severely affected by lack of demand and excess inventories, resulting in requests for SunCoke to reduce 2020 take-or-pay requirements. We assessed contract renewal timeframes with our continual focus on long-term stability and customer relationships, then negotiated 2020 coke purchase relief in exchange for contract extensions. This purchase relief reduced our 2020 Adjusted EBITDA, but resulted in much more stable future earning streams, which were recognized by the Board and as being in the best interest of our shareholders. The contracts with ArcelorMittal USA for our Jewell Coke and Haverhill Coke plants, which were to end on December 31, 2020, were renewed with modified annual tonnage for five years. The Haverhill contract with AK Steel, which was to end on December 31, 2021, was extended with the same annual tonnage for 18 months, to June 30, 2023.1

The short-term relief granted to our customers for the contract extensions and corresponding material 2020 financial impact was communicated to our shareholders on August 4, 2020 when we revised our guidance range down from earlier in the year. The reduction in guidance was less than the impact of the purchase relief, as management was able to offset some of the negative impact by focusing on significant operational cost discipline and Company-wide savings initiatives, resulting in a significantly higher guidance range than what we could have otherwise achieved. Through strong operating performance, cost discipline and savings initiatives, we ended the year with $205.9M in Adjusted EBITDA, which was higher than our August 3, 2020 revised guidance of $190M - $200M, though lower than our original guidance of $235M - $245M. Similarly, Operating Cash Flow results were $157.8M, which far exceeded our revised guidance of $116M - $136M, though lower than our original guidance of $170M - $185M.

Prior to reaching agreements in Q3 2020 to extend the contracts and provide 2020 coke purchase relief, we were on track to meet our original guidance, delivering Adjusted EBITDA of $62.1M in Q1. Our coke plants increased production by 63,000 tons in Q1 2020 compared to Q1 2019, as the rebuilt Indiana Harbor oven rebuild campaign offset benefits fromcoke ovens continued to perform well. Further, Adjusted EBITDA was $59M in Q2 2020, with our coke operations up $4.2M versus Q2 2019. For the remainderfirst half of 2020, despite having started to turn down production, we were performing just above our prorated original guidance point estimate of $240M.

We acknowledged the great benefit of the contract extensions, including an additional two-year extension with AK Steel for our Haverhill plant (from June 30, 2023 to June 30, 2025), reached later in the year. At the same time, we were resolved to mitigate the material financial impact in 2020. Through disciplined cost control and a Company-wide cost savings initiatives, we were able to significantly reduce that impact, as evidenced by our Adjusted EBITDA results of $205.9M.

1

Historically, substantially all of our metallurgical coke sales were made under long-term, take-or-pay contracts to three primary customers in the United States: AMUSA, AK Steel and United States Steel Corporation, each of which individually accounted for greater than ten percent of our consolidated revenues. In March 2020, Cleveland-Cliffs Inc. (“Cliffs”), a leading producer of iron ore pellets, completed an acquisition of AK Steel, and subsequently changed the name of that entity to “Cleveland-Cliffs Steel Holding Corporation.” In December 2020, Cliffs completed the acquisition of substantially all of the operations of AMUSA, its subsidiaries and certain affiliates, and subsequently changed the name of AMUSA to “Cleveland-Cliffs Steel LLC.” References herein to “AK Steel” will mean and include “Cleveland-Cliffs Steel Holding Corporation,” and references herein to AMUSA will mean and include “Cleveland-Cliffs Steel LLC.”

Operational focus to safely produce high-quality coke is the foundation of our domesticbusiness, and the ability of our teams to pivot from maximum production to a large turndown without issue demonstrates the soundness of that foundation. In addition, our teams pursued development of foundry coke, and Brazil cokemaking facilities. Logistics revenue and earnings were also in line with expectations. We captured several new business growth opportunities handling petcoke and aggregates at our Convent Terminal, broadeningwhich diversifies our customer base and leveragingallows entry into a new market. Our teams were able to perform this strategically positioned asset.work while simultaneously producing blast furnace coke—further evidence of our operating capabilities. This excellent domestic coke performance will now continue for 5 more years with predictable earnings at our AMUSA Jewell, and Haverhill plants and 3.5 more years at our AK Steel Haverhill plant due to the contract extensions.

Finding operational efficiencies and adopting rigorous cost control were the focus for our Logistics segment in 2020. Convent Marine Terminal (CMT), faced with the Q1 2020 bankruptcy of its take-or-pay customer Foresight Energy, concentrated on entering into a new coal handling agreement with Javelin while also scrutinizing any potential cost savings. When lower volumes also impacted our other terminals, they responded with extensive operational efficiency plans to considerably lower costs. Overall, the Logistics segment’s 2020 Adjusted EBITDA was $17.3M, down $25.3M from the prior year due to the CMT customer bankruptcy and lower volumes at the other terminals.

Pursuing a balanced capital allocation strategy continued to be important. Notwithstanding the financial impact of providing coke purchase relief in 2020 in exchange for contract extensions, we were still able to meet our capital allocation goals, including reducing net debt by approximately $61M and continuing to pay a $0.24/share dividend.

The followinghealth and safety of our employees and contractors has always been our first priority, and the COVID-19 pandemic necessitated new work practices and guidelines that we were well positioned to implement due to our safety culture. In response to the pandemic, we established an internal task force of experts, initiated enhanced health and safety measures across our facilities, which operated nonstop, and enacted a work from home program for all qualifying personnel. Each of our sites implemented screening procedures consistent with U.S. Centers for Disease Control and Prevention (CDC) recommendations such as screening questionnaires and temperature checks for employees, contractors or other service providers. Additionally, to ensure employee safety, we adopted protocols consistent with CDC, state and local guidance including mask wearing, social distancing, contact tracing, as well as quarantine requirements. We also implemented a paid-leave policy to ensure that COVID-19 positive employees and employees exposed to a COVID-19 positive individual opted to stay home. At the same time that we were adjusting to COVID-19 protocols, we continued to focus on preventing incidents. While zero incidents will always be our goal, we are very satisfied with our 2020 safety performance, which, despite COVID-19, is slightly better than our 2019 results.

Our excellent safety record is best understood in comparison to industry-wide safety performance. Our Total Recordable Incident Rate (“TRIR”) an industry standard metric of safety was 0.81 for 2020. According to most recent data from the Bureau of Labor Statistics, the overall TRIR for Petroleum and Coal Products Manufacturing was 1.3 for 2019. For comparison, it was 2.4 for the Iron and Steel Mills sector. Our year-over-year safety performance is consistently below industry-wide rates, demonstrating our strong commitment to safety, and we set our safety target, for the purposes of our annual incentive plan, better than industry benchmarks.

Environmental performance has always been central to our operations, and the Company continues to utilize actual, measurable environmental performance as a compensation metric. Despite substantial operational adjustments due to the coke production turndown, our 2020 performance was exceptional, significantly exceeding target and better than our results in both 2019 and 2018.

2020 Performance Executive Summary

In sum, our Adjusted EBITDA exceeded the revised guidance due to excellent Coke operational performance, including disciplined cost control, as well as Company-wide savings. Our solid safety performance continued to be meaningfully better than the industry average, and our environmental performance was exceptional. The decisive 2020 accomplishment was securing coke contract extensions for our AMUSA Jewell and Haverhill plants and our AK Steel Haverhill plant. We acted to provide short-term relief to our customers—at the expense of the 2020 financial results—for long-term stability of cash flows. To have done otherwise would have been irreconcilable with our focus on customer relationships, our commitment to shareholders, and long-term value creation.

Historical Performance

As demonstrated by the chart illustratesbelow, we have met or exceeded our historical earnings, cash generation and Total Shareholder Return (TSR).guidance for the last 5 years:

 

LOGOLOGO

Note:

For 2020 and 2019, EBITDA and Operating Cash Flow guidance based on revised guidance due to customer bankruptcy in 2019 and contract renegotiations with key customers in 2020. For 2017, Operating Cash Flow guidance represents revised guideline due to SXCP debt refinancing.

Chart Commentary:

Financial & Operational-

While we have consistently met or beat our guidance each of the last 5 years, our share price experiences significant volatility caused primarily by steel industry outlook factors, including steel imports, steel prices and the outlook and viability of our customers. In fact, despite generally consistent financial performance year after year, our share price is highly correlated with that of our customers such that steel industry outlook can create a disconnect between the Company’s operating results and share price.

Safety

LOGO

At SunCoke, our focus is on continuous safety improvement and while we did not achieve our target this past year, we improved our safety performance from 2019 and continue to strive for zero accidents in the workplace and a safe working environment at all times.

Environmental

We achieved our best environmental performance of the last three years against objective metrics, despite the coke production turndown challenges.

For a reconciliation of Adjusted EBITDA, anon-GAAP measure, to net income, and net cash provided by operating activities, which are its most directly comparable financial measuresmeasure calculated and presented in accordance with GAAP, please refer to Item 8 of our Annual Report on Form10-K for the year ended December 31, 2017.2020.

CEO 3-Year Target vs. Realizable Pay

We have delivered strong financial and operating performance, though our stock price faces significant volatility. We have a strong pay and performance orientation and we deliver a significant amount of compensation in the form of equity to further align our executives with shareholders. As demonstrated by the chart below, our CEO’s realizable pay, which considers the change in stock price and actual payouts, is 70% of his target compensation.

LOGO

Changes to our Executive Compensation Programs

During 2017, the Company implemented the following changes to our executive compensation plans:

For fiscal year 2017 compensation decisions, we restructured our compensation peer group to shift the selection emphasis from revenue to EBITDA, a more relevant metric given the nature of our business model.

To emphasize near-term performance, we maintained the shift of a portion of the long-term incentive component in the mix of NEOs’ pay to the annual incentive plan component.

In order to simplify the Annual Incentive Plan, we eliminatedpre-tax return on invested capital as a metric and reallocated the weighting to Adjusted EBITDA.Pre-tax ROIC continues to be one of two core metrics in our long-term performance shares. We also reduced the weighting for Safety & Environmental to 10% along with the payout maximum of 150% on those metrics, and shifted the resulting 10% to Adjusted EBITDA.

We realigned the PSU performance metrics to be a balance of cumulative3-year EBITDA andpre-tax Return on Invested Capital, with a modifier for Total Shareholder Return (TSR) relative to the NASDAQ Iron and Steel index.

To aid in retention and provide a mechanism for NEOs to accumulate share ownership, a portion (20%) of the long-term incentive awards for NEOs, other than the CEO, was granted in restricted share units. We continued to utilizeat-market stock options, performance-based stock options and performance-based restricted share units (RSUs) for the remainder of the grant. Consistent with 2016, there were no service-based restricted share units awarded to the CEO.

We reinstated company contributions to the Savings Restoration Plan.

The Company implemented the following changes to our executive compensation programs for 2018:

In light of our share price improvement over the last two years, we have reversed the shift in value from the Long-term Incentive component to the Annual Incentive component of our NEO compensation structure. This returns the mix of salary, short and long-term incentives for our executives to one which is more consistent with peer and market practices, and aligns with the interests of shareholders.

We are using a mix of performance share units, restricted share units (for NEOs other than the CEO) andat-market stock options. We have discontinued the use of performance stock options to reflect market practice and recognize that performance-contingent options were used when our stock was at historically low levels. We reduced the TSR modifier on our performance share units from 50% to 25%, but incorporated a provision such that if TSR is negative over the performance period, the payout is capped at 100% of target.

CEO Transition

Mr. Henderson elected to retire from the Company on December 31, 2017. Michael G. Rippey was appointed by the Board of Directors as President and CEO effective December 1, 2017. To provide for a smooth transition, Mr. Henderson continued to serve as executive Chairman through December 31, 2017, at which time John W. Rowe, who was the Company’s lead director, assumed the role ofnon-executive Chairman. In connection with Mr. Rippey’s appointment, the following are the key elements of his executive compensation:

Base annual salary of $750,000.

Annual Incentive target under the Company’s Annual Incentive Plan of 100% of base annual salary. Mr. Rippey was not eligible for an annual incentive payment related to 2017.

Mr. Rippey received a long-term incentive award for 2018 under the Company’s Long-term Performance Enhancement Plan of $2,000,000 on December 6, 2017. This award consisted of 80% performance share units and 20% market stock options.

Based on the employment terms negotiated with the Compensation Committee, Mr. Rippey’s total compensation at target for 2018 will be approximately 78% of the 2017 CEO targeted compensation.

Mr. Henderson will receive an annual incentive bonus for 2017, and his equity will vest to the extent provided for by the provisions of the Long-term Performance Improvement Plan and prior grant agreements.

Realizable Pay

To put the Company’s performance-based linkage into perspective, it is important to consider not only targeted pay levels, but also the realizable pay for the executives atyear-end and how this value tracks with shareholder return over time. The chart below shows that the former CEO’s realizable pay tracks the trend of the shareholder return, and that it was significantly below his target pay in the two years where TSR experienced a significant decline, demonstrating the linkage between TSR and realizable pay.

LOGO

Realizable pay is the actual base salary and annual bonus earned in each year, plus the value of equity awards at the end of each fiscal year. The value of the equity awards is calculated as: (a) RSU awards granted in the last three years;(b) in-the-money value of stock options received in the last three years; and (c) PSU awards granted in the last three years based on the projected payout at the end of each fiscal year. For each year’s realizable pay value, the sum of equity awards was divided by a factor of three to determine the annualized value of equity.

Shareholder Engagement

The Company values feedback from all of its shareholders and regularly engages with its largest, actively managedthem both at conferences and one-on-one. We believe this approach to engaging proactively and openly with the Company’s shareholders drives increased accountability, improved decision-making, and ultimately creates long-term value. During 2020, we engaged with 43 investors, including approximately 98 phone or in-person meetings. In addition, the Company’s President and Chief Executive Officer and Chief Financial Officer regularly engage in dialogue with the Company’s shareholders through the Company’s quarterly earnings call.

The Company received no recommendations on many issues, including executive compensation.compensation from shareholders in 2020. In March of 2016, we added two new Directors, who were recommended byaddition, our two largest shareholders at that time, to our“Say on Pay” vote in 2019 received 98.3% support from shareholders.

The Company’s Board and the Compensation Committee includingreviewed the Chairresults of the Compensation Committee. Feedback from shareholdersthis vote and the new Directors was considered in a numberconcluded that this level of the changes made in recent years, including the changes made to our long-term incentive award structure, the shift in the compensation mix from long-term to short-term incentives, the restructuringapproval reflects strong shareholder support of the CEO’s compensation and the changes made to the Peer Group. Importantly, in 2017, the Company held discussions with its largest actively managed investors and no material comments or recommendations were received.

In summary, we believe shareholders should support our compensation strategy and programs. In light of this approval, the structure of our pay programs has remained materially consistent throughout 2019 and actions for the following reasons:into 2020.

1.

Our compensation structure is aligned with shareholder interests. Relative to our peer group and based on industry surveys, our mix of performance-based equity vehicles is more aggressive than peers. The percentage of performance-based equity awards such as PSUs is higher than most other companies. Our metrics and targets are aggressive, evidenced by the fact that we have historically been challenged to achieve them. We do not have practices or provisions in our plans that would be considered excessive or inappropriate.

2.

In reaction to the downturn in the steel and coal markets, and the corresponding fall in our share price in late 2015 and early 2016, we took decisive action to control costs, including compensation costs. We also restructured our equity programs to reduce share usage during a period when our share price had significantly declined.

3.

Our executives’ realizable and realized pay has historically reflected total shareholder return, meaning that our executives have been appropriately rewarded or penalized for financial and share price performance.

SECTION 2 -- OUR COMPENSATION PHILOSOPHY

The principles of our compensation strategy are tied to paying for performance and increasing stockholdershareholders’ value over the long-term, and are as follows:outlined below:

 

Our compensation structure has a strong performance orientation, with a significant portion of pay at risk based on performance. This aligns with our shareholders’ interests. The level of pay at risk increases progressively at positions of greater responsibility.

 

Our compensation levels use the median of the market as a reference point, with flexibility for individual experience and performance.

 

The market is defined by reference to general industry, as well as a specific peer group.

 

Leadership compensation is aligned with shareholders’ interests, and leadership will be rewarded when the interests of stockholders are advanced.

The compensation structure supports our need to attract and retain top leveltop-level talent, including individuals with critical skills and top performers.skills.

 

We provide competitive benefits in a manner that emphasizes flexibility and the avoidance of legacy liabilities. For example, our NEOs have no defined benefit pension plan or retiree medical plan.

Below we summarize certain executive compensation practices that we have implemented, and other practices that we have avoided:

WHAT WE DO:

   Tie a high percentage of executive pay to performance

 

   Establish measurable goals and objectives in the beginning of the performance period for performance-based grants

 

   Structure our compensation programs to avoid incentives to take excessive risk

 

�� Maintain “double-trigger” vesting provisions on severance and equity awards upon a change in control

 

   Pay dividends or dividend equivalents on share unit awards only to the extent shares are earned and vested

 

   Maximum payout is limited under our short-term and long-term performance-based incentive awards

Review with the Compensation Committee “tally sheets” that illustrate the total payment from all programs to executives under certain termination scenarios

 

   Require our executive officers and directors to hold Company stock pursuant to stock ownership guidelines

 

   Have a recoupment, or “claw back”, policy

 

   Prohibit the following activities by executive officers or directors:

 

¡o  Hedging transactions and/or short sales involving Company stock

 

¡o  Pledging Company stock or depositing or holding Company stock in a margin account

 

Pay dividends or dividend equivalents on share unit awards only to the extent shares are earned and vested

   Rely on the advice of an independent compensation consultant who provides no other services to the Company

 

WHAT WE DON’T DO:

×   No perquisites, other than partial commuting allowances in lieu of relocation for certain executives

×   No taxgross-ups, including on change in control payments

×Nore-pricing or cash buyout ofout-of-the-money stock options

×   No individual employment contracts or individual change ofin control agreements

×No inclusion of the value of equity awards beyond our severance / change in pension or severance calculationscontrol plan

SECTION 3 -- ELEMENTS OF EXECUTIVE COMPENSATION

Our 2017 compensation program emphasized performance-based compensation that promoted the achievement of short and long-term business objectives that were aligned with our business strategy and rewarded performance when those objectives were met. The basic elements of our compensation program are as follows:

Base Salary:Base salary is intended to provide a certain level of fixed cash pay that compensates an executive for job performance and reflects the scope and level of responsibilities for each role. Competitive salary helps to recruit and retain executives.

Annual Cash Incentives:Annual cash incentives are paid after the end of each year based on the level of attainment of performance goals. This component, which can result in a payment of0-200% of target opportunity, promotes achievement of our annual business objectives. The use of four metrics, which include financial, safety and environmental measures, provides a holistic view of performance, which balances financial and operational performance while limiting reliance on any one metric which could encourage excessive risk-taking.

Long-Term Incentives:These awards are designed to provide a strong incentive for executives to pursue business strategies intended to increase our stock price and thus provide strong alignment with stockholders’ interests. These awards also promote executive retention. Generally, when equity is awarded, restricted share units and stock options vest ratably over three years. In addition, the performance share units vest on the third anniversary of the date of grant, to the extent that certain performance goals are met.

SECTION 4 -- ROLE OF MANAGEMENT, COMPENSATION CONSULTANTS AND MARKET DATA

Role of Management

Each year, the Board of Directors establishes measurable performance goals and objectives for the CEO and the Company, and reviews and evaluates the CEO’s performance considering these goals and objectives. The Compensation Committee annually provides a recommendation to the full Board regarding the compensation levels and incentive payouts applicable to the CEO, based upon the Board’s review and assessment of the CEO’s performance. In its review of the incentive components of CEO compensation, the Compensation Committee also may consider many factors, including, but not limited, to the Company’s performance and relative shareholder return, the value of similar incentive awards to CEOs at comparable companies and the awards given to the CEO, in past years. The Board then makes a determination regarding CEO compensation after considering the Compensation Committee’s recommendations. The Compensation Committee and the CEO also discuss the financial metrics to be used to measure the performance of the Company and its business units.

The CEOturn, reviews the performance of our NEOs, other than himself, and makes recommendations to the Compensation Committee with respect to their compensation, including salary, annual cash incentive opportunities and grants of long-term incentive awards.

After considering the data on market-based compensation provided by the Company’s independent compensation consultant, the Compensation Committee annually reviews and assesses the compensation levels and incentive payouts for our NEOs. The Compensation Committee reviewsalso considers other factors, including, but not limited to, the Company’s results of operations, relative shareholder return, other applicable metrics used to measure the performance of the Company and determinesits business units, and the value of similar compensation of these executivesand incentive awards to NEOs at comparable companies.

Based upon this review, the Compensation Committee then presents its recommendations for approval to the full Board and, after considering the CEO’s inputCompensation Committee’s recommendations, the Board then makes a determination regarding the appropriate levels of compensation and recommendations, and its own judgment of each executive’s performance duringincentive grants for the period.NEOS, including the CEO. The CEO attends Compensation Committee meetings, but is not present for, and does not participate in, discussions concerning histhe CEO’s own compensation. In addition, the CEO does not attend the executive sessions of the

Compensation Committee.Consultant

Under its charter, the Compensation Committee has the sole authority to retain and terminate any compensation consultant used in the evaluation of executive compensation, and has the sole authority to approve the retention terms of the consultant, including fees. Since 2011, theThe Compensation Committee has retained Compensation Advisory Partners, or CAP,(“CAP”), an independent compensation consulting firm, to provide advice on executive compensation matters. Pursuant to the NYSE listing standards, the Compensation Committee regularly reviews the consultant’s independence relative to key factors, including: (i) whether the consultant provides any other services to the Company; (ii) the amount of fees paid relative to the total revenue of the firm; (iii) policies in place to prevent conflicts of interest; (iv) any personal or business relationships with members of the Compensation Committee; (v) ownership of SunCoke stock and (vi) any personal or business relationships with executive officers. Based on its assessment, the Compensation Committee concluded that CAP is independent and that no conflicts of interest exist.

CAP provides advice on emerging trends, data on market-based compensation and competitive pay levels, and regulatory developments as they relate to executive compensation. CAP’s services included evaluating our NEO total compensation competitive positioning, developing our compensation peer group, assisting in our annual and long-term incentive plan design, assessing potential risks in our incentive plans, and assisting in the preparation of this Compensation Discussion and Analysis.CD&A. CAP performs no other work for us.

Market Data

We operate in a unique sector of the industry, with no public companies that are direct competitors. The market data that the Compensation Committee considers when making executive compensation decisions is based in part on information from national surveys conducted by Willis Towers Watson, Mercer and Mercer.Equilar. During 2017,2020, the SunCoke Energy survey data was a blend of general industry survey data for companies with revenues of between $1 billion and $3 billion.billion for Willis Towers Watson and Mercer, and $1 billion to $5 billion for Equilar (General Industry survey data).

To supplement the survey data when making compensation decisions, for 2017, management recommended, and the Compensation Committee has approved, a peer group of 18 companies. During 2016, the Compensation Committee undertook a comprehensive review of the Company’s peer group, considering several potential criteria for selecting peer16 companies and also considering feedback from our largest shareholder.(the “Peer Group”). Unlike many companies, the nature of SunCoke’s long-termtake-or-pay coke contracts, which pass through commodity and certain operating costs to customers, makes revenue less relevant. meaningful.

As a result, of this review, the Company adopted a new selection criterion, which uses EBITDA as the primary financial metric in selecting companies from comparable industries, rather than revenue.industries. Selected companies generally fall within the range ofone-third to three times of SunCoke’s EBITDA; however, the Compensation Committee also considers other financial metrics, including market capitalization, enterprise value and revenue, as appropriate, in making the final determination of peer companies. As a result of this review, the below changes were made to the 2016 peer group.

Companies Added

Companies Removed

•   Cliffs Natural Resources

•   Airgas, Inc.

•   Eagle Materials, Inc.

•   Albemarle Corporation

•   Headwaters Incorporated

•   A.M Castle & Company

•   Kraton Corporation

•   Globe Specialty Metals, Inc.

•   Mineral Technologies, Inc

•   GrafTech International Ltd.

•   Quaker Chemical Corporation

•   Martin Marietta Materials, Inc.

•   Schnitzer Steel Industries, Inc.

•   Vulcan Materials Company

•   U.S. Concrete, Inc.

•   W.R Grace & Company

•   Westmoreland Coal Company

Market capitalization and enterprise value are used as reference measures when considering peers but these measures are very volatile, specifically in our industry. The approved 2017 compensation peer group included the following companies:

 

Company   2017  
EBITDA
 3-Year
  EBITDA  
   2017  
Revenue
   Market Cap.  
at 12/31/17
   Enterprise Value  
at 12/31/17
 Primary Industry   2020  
  EBITDA  
(millions)
   3-Year  
  EBITDA  
(millions)
 2020
  Revenue  
(millions)
 Market Cap.
  at 12/31/20  
(millions)
   Enterprise Value  
at 12/31/20
(millions)
 Primary Industry
 (millions) (millions) (millions) (millions) (millions) 

Cleveland-Cliffs Inc.

 $535 $1,831 $5,354 $6,951 $11,692 Steel

Eagle Materials Inc.

 $402 $1,224 $1,451 $4,238 $5,334 Construction Materials

Cabot Corporation

 $374 $1,412 $2,614 $2,540 $3,731 Commodity Chemicals

Minerals Technologies Inc.

 $303 $989 $1,595 $2,112 $2,788 Specialty Chemicals

Carpenter Technology Corporation

 $274 $930 $2,181 $1,398 $1,930 Steel

Koppers Holdings Inc.

 $217 $557 $1,669 $656 $1,532 Commodity Chemicals

Quaker Chemical Corporation

 $217 $501 $1,418 $4,518 $5,292 Specialty Chemicals

Worthington Industries, Inc.

 $208 $744 $3,059 $2,708 $2,747 �� Steel

Kraton Corporation

 $196 $817 $1,563 $886 $1,889 Specialty Chemicals

Allegheny Technologies Incorporated

 $182 $1,086 $2,982 $2,127 $3,216 Steel

U.S. Concrete, Inc.

 $170 $499 $1,366 $658 $1,452 Construction Materials

Ferro Corporation

 $125 $420 $959 $1,204 $1,998 Specialty Chemicals

Warrior Met Coal, Inc.

 $94 $1,201 $783 $1,091 $1,282 Steel

Materion Corporation

 $86 $267 $1,176 $1,295 $1,393 Diversified Metals and Mining

Schnitzer Steel Industries, Inc.

 $79 $408 $1,712 $876 $1,111 Steel

AK Steel Holding Corporation

 $533 $1,390 $6,081 $1,782 $4,164 Steel      Acquired as of 12/31/2020 Steel

Cleveland-Cliffs Inc.

 $498 $1,761 $2,330 $2,138 $3,613 Steel

Cabot Corporation

 $494 $1,508 $2,717 $3,815 $4,607 Commodity Chemicals

Eagle Materials Inc.

 $373 $909 $1,211 $5,509 $6,135 Construction Materials

Allegheny Technologies Incorporated

 $356 $651 $3,525 $2,628 $4,517 Steel

Minerals Technologies Inc.

 $352 $1,021 $1,676 $2,435 $3,249 Specialty Chemicals

Kraton Corporation

 $345 $537 $1,960 $1,508 $3,148 

Specialty Chemicals

Worthington Industries, Inc.

 $306 $824 $3,014 $2,677 $3,459 

Steel

Westmoreland Coal Company*

 $257 $563 $1,478 $23 $1,046 Coal and Consumable Fuels

Carpenter Technology Corporation

 $214 $793 $1,798 $2,387 $2,970 Steel

Ferro Corporation

 $208 $382 $1,397 $1,978 $2,629 Specialty Chemicals

Koppers Holdings Inc.

 $188 $419 $1,476 $1,056 $1,711 Commodity Chemicals

Headwaters Incorporated*

 $173 $452 $975 $1,758 $2,441 Construction Materials

U.S. Concrete, Inc.

 $160 $349 $1,336 $1,326 $1,767 Construction Materials

Quaker Chemical Corporation

 $113 $310 $820 $2,005 $1,981 Specialty Chemicals

Schnitzer Steel Industries, Inc.

 $101 $280 $1,688 $883 $1,025 Steel

Cloud Peak Energy Inc.

 $84 $361 $861 $334 $629 Coal and Consumable Fuels

Materion Corporation

 $83 $238 $1,139 $974 $955 Diversified Metals and Mining

  

75th Percentile

 $355 $887 $2,238 $2,423 $3,575  $288 $1,144 $2,398 $2,624 $3,473 

Median (n=18)

 $235 $550 $1,577 $1,880 $2,799 

Median (n=16)

  $208  $817  $1,595  $1,398  $1,998 

25th Percentile

 $163 $366 $1,242 $1,124 $1,725  $148 $500 $1,392 $989 $1,492 

  

SunCoke Energy, Inc.**

 $235 $625 $1,332 $1,100 $1,839 Steel

SunCoke Energy, Inc.

 $206 $717 $1,333 $360 $1,029 Steel

Percent Rank

 50% 57% 29% 24% 31%    49%  42%  20%  0%  0%  

Source:Source for peer data: S&P Capital IQ Database

Notes: Companies are sorted in descending order based on EBITDA. AK Steel was acquired in 2020 and their information for 2020 is not available.

*

Westmoreland Coal Company was removed from the 2018 peer group, due to low market capitalization. Headwaters Incorporated was acquired during 2017, so the foregoing table reflects March 31, 2017 data for that company. Headwaters Incorporated was removed from the 2018 peer group.

**

In the foregoing table, the data for SunCoke Energy, Inc. reflect ownership interest in SunCoke Energy Partners, L.P. [NYSE: SXCP].

Note: Companies in the foregoing table are sorted in descending order based on EBITDA. Based on 20172018—2020 Adjusted EBITDA, SunCoke was positioned at the 50th42nd percentile of the peer group.

SECTION 4 -- ELEMENTS OF EXECUTIVE COMPENSATION

Our 2020 compensation program emphasized performance-based compensation that promoted the achievement of short- and long-term business objectives that were aligned with our business strategy and rewarded performance when those objectives were met. The basic elements of our compensation program are as follows:

Base Salary: Base salary is intended to provide a certain level of fixed cash pay that compensates an executive for job performance and reflects the scope and level of responsibilities for each role. Competitive salary helps to recruit and retain executives.

Annual Cash Incentives: Annual cash incentives are paid after the end of each year based on the level of attainment of performance goals. This component promotes achievement of our annual business objectives. The use of four metrics, which include financial (Adjusted EBITDA and Operating Cash Flow), safety, and environmental measures, provides a holistic view of performance, which balances financial and operational performance while limiting reliance on any one metric, which could encourage excessive risk-taking.

Long-Term Incentives: Long-Term Incentive (LTI) awards are designed to promote business strategies that deliver strong operational results year-over-year. As such, these awards provide strong alignment with shareholder interests and, absent the Company stock being highly correlated with our customers and steel industry outlook, should be reflected by an increase in stock price. These awards also promote executive retention. Generally, when equity is awarded, restricted share units vest ratably over three years. In addition, both the performance share units and long-term performance cash vest on the third anniversary of the date of grant, if certain performance goals are met.

SECTION 5 -- PAY MIX, OPPORTUNITY AND LEVERAGE

The total direct compensation opportunity for each NEO in 20172020 was based on the NEO’s annual base salary, rate, annual target cash incentive award opportunity and annual target long-term incentive award opportunity. In making its decisions, the Compensation Committee considered both the Peer Group and General Industry survey data for each NEO’s position. The General Industry data is a blend of Towers Watson and Mercer general industry survey data for companies with annual revenue between $1 billion and $3 billion. The Compensation Committee retained the flexibility to adjust compensation levels based upon other factors such as individual experience and performance.

There were no merit increases in base salary for any of the NEOs during 2017. Mr. Henderson’s long-term incentive compensation target was increased from 250% of base annual salary to 300%, which was partially offset by a decrease in his annual incentive target from 150% to 125% of base annual salary. Mr. Henderson’s total direct compensation at target was 4% below the Peer Group median and 9% below the General Industry survey median for Chief Executive Officers. Mr. Rippey’s total compensation at target is 25% below the Peer Group median for CEOs and 28% below the General Industry median for CEOs. Ms. West’s total direct compensation at target was 15% below the Peer Group and 3% above the General Industry survey median for Chief Financial Officers. Mr. Hardesty’s total direct compensation is 29% below the Peer Group data for the third highest paid executive and

12% below the Peer Group median for a 50/50 blend of the COO and top sales executive. Ms. Gates’ total direct compensation at target was 19% below the Peer Group median for General Counsels and 3% above the General Industry survey median for General Counsels. Mr. Yeaw’s total direct compensation at target was 31% below the Peer Group median for Chief Human Resource officers and 15% above the General Industry survey median for Chief Human Resource Officers.

As discussed earlier, ourOur philosophy is to drive a performance-oriented culture. To this end, performance-based compensation makes up a meaningful portion of each NEO’s compensation as demonstrated in the chart below. We consider the compensation we pay through annual cash incentives under the Annual Incentive Plan, or AIP, and long-term equityLong Term Incentives, or LTI grants, under the Long-Term Performance Enhancement Plan, or LTPEP, to be performance-based.

 

LOGO

LOGO

These percentages are based on each current NEO’s salary and annual and long-term incentive targets atyear-end 2017.for 2020.

Base Salary

Base salary is the only fixed portion of total direct compensation for our NEOs. We focus on setting base salaries that are competitive with the market,market-based, though actual positioning may vary based on factors such as individual performance, responsibilities associated with the position, experience in the position and more broadly, internal equity and the competitive market at the time of recruitment.

The Compensation Committee considers adjustments to the base salaries of executive officers on an annual basis. For 2020, the Compensation Committee approved a market-based increase of 10.8% for Mr. Rippey’s base salary to align his compensation closer to the peer group median. This increase along with increases for Ms. West, Mr. Hardesty and Mr. Quanci were approved in February 2020. Ms. Gates’ was not eligible for an annual base increase due to her promotion in November 2019.

  Named Executive Officer  

2020 Annual
  Base Salary ($)  

 

2019 Annual
  Base Salary ($)  

 Percentage
  Increase (%)  
  
 

  Mr. Rippey

  925,000         825,000           10.8         
 

  Ms. West

  504,700         490,000           3.0         
 

  Ms. Gates

  450,000         450,000           —         
 

  Mr. Hardesty

  432,600         420,000           3.0         
 

  Mr. Quanci

  382,692         371,527           3.0         

Annual Cash Incentive Awards

Overview: The NEOs participated in the SunCoke Annual Incentive Plan, or AIP, which is a performance-based annual cash incentive plan designed to promote the achievement of our short-termannual business objectives by providing competitive incentive opportunities to executivesemployees who can significantly impact our performance. The payout under the AIP for each NEO is based on a combination of financial and operating goals, as well as individual performance. An executive’s annual incentive payment, if any, may not exceed 200% of his or her target incentive opportunityopportunity. Attaining an award payout of 200% would require reaching the maximum payout (150%) for financial and is determined by the following formula:

Payout = Base Salary x Target Incentive Opportunity x Company Payout Factor x Individual Performance Factoroperating goals and displaying extraordinary individual results.

Target Incentive Opportunity:Each executive has a target incentive opportunity that is expressed as a percentage of annual salary. The 20172020 target incentives for our NEOs remained unchanged from 2016 (except for Mr. Henderson’s reduction from 150%) and continued to reflect a shift from long-term equity awards, andat year-end were as shown in the table below. Due to his December 1, 2017 hire date, Mr. Rippey did not participate in AIP for 2017.

 

NEO

  Annual Base Salary   

Target Incentive as % of Salary

   Annual Base Salary ($)  

  Target Incentive as % of Salary  

        

Mr. Henderson

  $850,000    125

Mr. Rippey

   925,000   100

Ms. West

  $460,000    120   504,700   70

Ms. Gates

   450,000   70

Mr. Hardesty

  $380,000    105   432,600   70

Ms. Gates

  $380,000    85

Mr. Yeaw

  $375,000    75

Mr. Quanci

   382,692   65

For 2017,2020, the AIP used the following corporate performance goals:goals and weighting, which are unchanged from 2019:

 

Metric

  Weighting  

Rationale and Definition

Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (Adj. EBITDA)

  70%  

Adjusted EBITDA was selected as the primary measure since we believe it best aligns with key measures of our business strategy and strongly correlates with stockholdershareholder value creation.

 

As defined in Item 8 of the Company’s Form 10K, Adjusted EBITDA, which is defined as earnings before interest, (gain) loss on extinguishment of debt, taxes, depreciation and amortization (“EBITDA”), adjusted for any impairments, coal rationalization costs, changes to our contingent consideration liability related to our acquisition(gain) loss on extinguishment of CMT, the expiration of certain acquired contractual obligations, and interest, taxes, depreciation and amortization and impairments attributable to our equity method investment.

In order to simplify the Annual Incentive Plan, we eliminatedpre-tax return on invested capital as a metric and reallocated the 10% weighting to Adjusted EBITDA.Pre-tax ROIC continues to be one of two core metrics in our long-term performance shares.debt.

 

Operating Cash Flow

  10%  

Operating cash flow measures the cash generated by our business activities. The cash generated by our business activities includes receipts from customers and payments for operating expenses.

 

Safety Performance

  10%  

Safety performance consists of anall-company target (Coke, Corporate and Logistics), which is measured using the regulatory (Occupational Safety and Health Administration and Mine Safety and Health Administration) Total Recordable Incident Rate or TRIR (actual recordable incidents x 200,000, which is the approximate number of hours a person works each year multiplied by 100, divided by totalman-hours worked). In addition, to achieve performance more than 100%, there must be no high severity incidents. High severity is defined as any injury: a) requiring immediate hospitalization for five or more days for treatment (admissions for observatory purposes only do not apply), b)an injury resulting in 90 dayspermanent and total disability or more away from work or restricted time, or c) resulting in a fatality. The maximum payout on safety performance was revised to 150% and the weighting reduced to 10%, with the resulting 5% shifted to Adj. EBITDA.

 

Environmental Performance

  10%  

Environmental performance is determined by a comprehensive assessment of (i) venting levels relative to each plant’s operating permit;permit or other agreements or allowances; (ii) the number of preventable “deviations,” which are defined as noncompliancenonconformance with an Environmental Protection Agency air permit term; and (iii) compliance with the Consent Decree at our Haverhill and Granite City locations; and (iv) variousconsideration of other factors, including satisfactory progress to resolve notices of violation at our facilities.relevant factors. In conducting its assessment of these factors, the Compensation Committee does not useuses a formulaic approach for (i) and (ii), but also applies its judgment when considering (iii) as to whether and at what level they have been satisfied. The max payout on environmental performance was revised to 150% and the weighting reduced to 10%, with the resulting 5% shifted to Adj. EBITDA.a modifier.

 

The following table sets forth the quantitative performance goals for 20172020 and the approved performance result as a percentage of target. The threshold, or 0%25% achievement, is typically set at a level which would representthat represents minimum acceptable performance by the Company in the context of the business conditions and other challenges facing the Company. The target, or 100% achievement, is set at a level which would representthat represents performance that is more demanding but still reasonably attainable. The maximum, or 200%150% achievement, is set at a level which would representthat represents extraordinary performance. The 100% achievement factor for financial metrics is set at the level of the Board approvedBoard-approved operating plan. The 85% payout level is set consistent with lower external guidance to investors, and the 115% is set based on symmetry to lower guidance. The threshold (0%(25%) and maximum (200%(150%) achievement factors represent 80% and 120%105% of the target level performance. Safetyperformance, and environmental metrics area curve is utilized to establish payout levels between the threshold and maximum. The safety metric is based on long-termannual performance relative to an internal target set each year, which is based on available internal performance and external metrics,benchmarks. The environmental metric is based on annual permit compliance, including air emissions and deviations, as well as other factors important to the Company’s environmental results.

The Company’s payout curve is designed to incentivize employees to find every opportunity, no matter how small, to increase Adjusted EBITDA, without sacrificing safety or environmental performance. Because the Company’s Adjusted EBITDA is generated primarily from take-or-pay coke contracts set at contract maximums with our customers, the opportunity for significant upside is limited. SunCoke typically sets guidance within a $10 - $15 million range, so increases of even $2 million of Adjusted EBITDA should be encouraged and recognized. In addition to the operating performance payout maximum of 150%, an expectationemployee’s individual performance is a factor in the ultimate payout, with the total AIP having a cap of continuous improvement, and each has a200%. Attaining an award payout of 200% would require reaching the maximum payout for financial and operating goals of 150%. The 2017 Adjusted EBITDA target represented an 8.3% improvement over 2016 performance. The operating-cash flow target was set lower than 2016 targets due to forecasted working capital changes. In 2016, the Company took certain steps to better manage its working capital, including modifying the agreed uponpoint-of-sale at some of its cokemaking facilities. Additionally, the Company extended payment terms for a portion of its coal suppliers. Both of these activities contributed to aone-time working capital benefit in 2016, which was not expected to and did not recur in 2017.

LOGOdisplaying extraordinary individual results.

In approving the final payout of the 20172020 Annual Incentive, the Compensation Committee used Adjusted EBITDA as the primary metric (70% weighting). Adjusted EBITDA considers the impact of impairments, coal rationalization costs, changes to our contingent consideration liability related to our acquisition of CMT, the expiration of certain acquired contractual obligations and, for 2020, the change in itscontract terms due to early negotiations for contract extensions with our customers.

Because the change in the contracts occurred mid-year after our original guidance was set, we issued revised guidance to investors in our second quarter Earnings call. The Committee considered (i) the original guidance, (ii) the revised guidance, and (iii) performance for the first half of the year measured against the pro-rated original guidance, coupled with performance for the second half of the year measured against the pro-rated revised guidance. The Adjusted EBITDA based on the 1H / 2H evaluation could have resulted in a payout of more than 135% of target. However, recognizing the economic environment and the fact that the benefit of the contract extensions will be mostly realized in 2021 and beyond, the Committee exercised the negative discretion considers potential adjustmentspermitted under the AIP and capped the overall payout at 80% of target for SVPs and the CEO.

  Metric Weighting  2020 Performance Goals
under Original Guidance
  H1 Actual
Performance
  H1 Implied
Payout
against
Original
Guidance
  H2 Actual
Performance
  H2 Implied
Payout
against
Revised
Guidance
 
 

Threshold

(25%)

  

Target

(100%)

  

Maximum

(150%)

 

  Actual Reviewed Results (H1 and H2)

         

  Adjusted EBITDA ($MM)

  70  $192.0  $240.0   $252.0   $121.0   103.5  $  90.0   105.0

  Operating Cash Flow ($MM)

  10  $130.0  $178.0   $190.0   $  48.6   8.0  $109.2   15.0

  Assumed target at H1, actual for full year:

         

  Safety Performance

  10  1.1   0.7   0.3   n/a   10.0  0.81   7.9

  Environmental Performance

  10  Formula plus modifier   n/a   10.0  n/a   12

  Total Payout Factor

                      131.4      139.9

The decision to provide our steel customers with 2020 coke purchase relief in exchange for contract extensions is the results. These adjustments, which can be positive or negative, may includeepitome of an unbudgeted initiatives whichinitiative that will have a benefit the Company in future periods or are deemedand is in the best interest of shareholders. Rather than require full 2020 performance on our take-or-pay contracts, we assessed our contract renewal timeframes and the long-term interests of shareholders, as well as items whichthen negotiated 2020 relief in exchange for contract extensions at our AMUSA Jewell and Haverhill plants and AK Steel Haverhill plant. The 2020 impact of these negotiations was a material reduction in Adjusted EBITDA, but we resolved to offset this impact by achieving significant Company-wide savings. We committed ourselves to finding these savings when we announced the contract extensions and set the revised guidance of $190M—$200M in our Q2 Earnings. Had we insisted on full performance, we estimate that we would have exceeded our original guidance point estimate of $240M for a payout above 100%.

To assess the 2020 Annual Incentive Payout, the Committee divided the year into two halves:

First Half of 2020: We entered into negotiations with customers in the middle of 1H, but despite this, our results measured against the prorated original guidance point estimate of $240M would have yielded a payout of 131.4%.

Second Half of 2020: Our production was fully turned down and we were unplannedimplementing cost savings initiatives. Disciplined operational performance and uncontrollable. The net effectcost control, coupled with the Company-wide savings, drove 2H 2020 Adjusted EBITDA to $90M. This would have resulted in a 2H payout of the 2017 adjustments increased the approved Company payout by 3.1%. Details on the adjustments follow.139.9% when measured against our prorated revised guidance point estimate.

In calculating the approvedreviewing EBITDA performance for Operating Cash Flow,2020, the Compensation Committee adjusted Operating Cash Flow for the effect of the Company’s refinancing activities, specifically, the additional interest payment resulting from the timing of the refinancing activities. The adjustment to Operating Cash Flow was $10.9 million.

During 2017 the Company initiated discussions to purchase the outstanding units of SunCoke Energy Partners, L.P. While management and the Board of Directors continue to believe in the merits of a combined SunCoke structure, ultimately the Company could not agree upon terms with the Conflicts Committee of SunCoke Energy Partners’ Board of Directors. Legal and investment banking costs in the amount of $1.8 million related to this and other transactions, which were ultimately not concluded, have been excluded from the Adjusted EBITDA and Operating Cash Flow calculations. In addition, the Compensation Committeealso excluded the positivenegative impact of a decreasean increase in Black Lung reserves from legacy operations of $0.5 million$7.4M above budgeted results, which was offset by $2.2M in Adjusted EBITDA.reduced Asset Retirement Obligations liability. This is consistent with the treatment of Black Lung reserve changes in prior years.

Based onCombining the 1H 2020 (original guidance) and 2H 2020 (revised guidance) would yield a payout of more than 135%. The Committee recognized the Company’s Adjusted EBITDA, cash flowperformance through the (a) the contract extensions, (b) strong, cost-disciplined operating performance throughout the COVID-19 pandemic, (c) safety and operationalenvironmental performance, as well asand (d) the executive team’s actions to reduce costs,de-leverachievement of significant Company-wide savings in 2020. At the balance sheetsame time, being cognizant of the economic climate, the Committee used negative discretion and supportapproved a final payout of 80% for SVPs and the transition in CEO the Compensation Committee approved an individual performance factor of 100% for each NEO (no(with no upward or downward individual adjustment). Mr. Rippey recommended and the Committee agreed to a payout of 100% of target for Mr. Quanci, in recognition of his substantial efforts to optimize our operational performance.

The total bonus amounts paid to each NEO for 20172020 were:

 

NEO

  2017 Target AIP
Amount
   

2017 AIP Payout

Amount

     2020 Target AIP  
Amount ($)
    2020 AIP Payout  
Amount ($)

Mr. Henderson

  $1,062,500   $1,074,187 

Mr. Rippey

   925,000   740,000

Ms. West

  $552,000   $558,072    353,290   282,632

Ms. Gates

   315,000   252,000

Mr. Hardesty

  $399,000   $403,389    302,820   242,256

Ms. Gates

  $323,000   $326,553 

Mr. Yeaw

  $281,250   $284,344 

Mr. Quanci

   248,749   248,750

Senior Executive Incentive Plan

TheFor our 2021 AIP workstargets, we will follow our typical process and establish goals based on our rigorous business plan and guidance to shareholders. We are not receiving a benefit in conjunction withour business plan from the Senior Executive Incentive Plan, or SEIP, which acts as an overlay tocontract extensions. Instead, the AIPplan reflects the expected earnings and sets a performance-based ceilingcash flow based on the bonuses paid under the AIP, so that they meet the deductibility requirements of Section 162(m)terms of the Internal Revenue Code. For 2017, the SEIP covered Mr. Henderson, Mr. Hardesty, Ms. Gates and Mr. Yeaw. (CFOs were not subjectcontracts, identical to Section 162(m) in 2017). With Adjusted EBITDA as the performance metric, the Compensation Committee established a bonus pool under the SEIP equal to 5% of Adjusted EBITDA, with each participant being allocated a maximum allowable percent of the funded pool. Once the pool is funded, the Committee utilizes the criteria in the AIP to determine the final payout. To the extent that an NEO is awarded a bonus amount above the calculated bonus under the AIP, any such incremental amount is paid under the SEIP. For 2017, there were no payouts under the SEIP Plan.prior years.

Long-Term Incentives

Long-Term Performance Enhancement Plan (LTPEP)(LTPEP)

Equity awards under the LTPEP are designed to align the executives’ compensation with the interests of shareholders by creating a direct linkage between the executives’ rewards and shareholders’ gains, provide management with the ability to increase equity ownership in SunCoke Energy, provide competitive compensation opportunities that can be realized through attainment of performance goals and provide an incentive to attract and retain executives. There are fourtwo elements to our long-term incentive program:

Market Stock Options. Stock options are a form of compensation that allows the executive to purchase SunCoke Energy common stock at a fixed price (the closing price on the date of grant) within 10 years. The options generally vest ratably over three years on each anniversary of the grant date.

Performance Stock OptionsShare Units:. Performance stock options are a formshare units, or PSUs, represent rights to receive shares of compensation that allows the executive to purchase SunCoke EnergyCompany common stock, at a fixed price (typicallywith vesting conditioned upon the closing price onattainment of performance goals established by the date of grant), within a specified period. These options have a performance vesting

requirement in addition to a service vesting requirement. The performance and the service vesting requirement must be met in orderCompensation Committee for the option to be exercisable.applicable performance period, as well as the participant’s continued employment with SunCoke.

Restricted Share Units.: Restricted share units, or RSUs, represent rights to receive shares of Company common stock, with vesting conditioned upon continued employment with the Company through the end of the applicable restriction period. RSU awards generally vest ratably over three years on each anniversary of the grant date.

Performance Share UnitsLong-Term Cash Incentive Plan (LTIP). Performance share units, or PSUs, represent rights

Long-Term performance cash awards under the LTIP are designed to receive sharesalign the executives’ compensation with the interests of Company common stock,shareholders by providing competitive compensation opportunities that can be realized through attainment of performance goals and provide an incentive to attract and retain executives. Awards are granted with vesting conditionedconditional upon the attainment of performance goals established by the Compensation Committee for the applicable performance period, three years, as well as the participant’s continued employment with SunCoke.

Each year, the Compensation Committee evaluates the appropriate compensation mix and reviews the Peer Group data and General Industry survey data regarding the typical mix of medium-short and long-term incentive awards. Based upon the NEO’s long-term incentive target and position, and factoring in Peer Group practices as well as our compensation philosophy, the Compensation Committee determines the appropriate mix of equity vehicles for each executive as well as the target long-term incentive compensation as a percentage of base salary. As with 2019, our 2020 long-term incentive awards included performance share units and restricted share units.

The Compensation Committee determines the performance metrics for the long-term awards based on the financial measures most relevant to the Company’s performance and generation of long-term value for shareholders. SunCoke’s largestcore business, the production of metallurgical coke, is a capital-intensive business with long-term “take or pay”take-or-pay contracts with integrated steel producers. Our share price experiences significant volatility caused, in part, by industry factors including steel imports, steel prices and the outlook and viability of our customers. Our revenue is largely determined by coal prices, for whichwhere we are generally not at risk based on the structure of our take or paytake-or-pay coke contracts. Therefore, the Compensation Committee determined that the two most important drivers of long-term performance are cumulative Adjusted EBITDA andpre-tax Return on Invested Capital.Capital (ROIC), and therefore both are included as metrics in the PSUs and long-term performance cash awards. A Total Shareholder Return, or TSR modifier, is also part of the metrics in orderused to partially adjust the performance share unit award value to reflect shareholder return, regardless of the underlying generation of three- year Adjusted EBITDA or three- year average pre-tax ROIC.

Our long-term incentive awards are subject to other terms and conditions set forth in the applicable award agreements. In February 2017,2020, the Compensation Committee made equity awards to

the NEOs. For Mr. Henderson,NEOs, with the allocation was 10%40% RSUs, 30% PSUs and 30% Long Term Performance Cash. In 2020, NEOs received long-term incentive awards, based on performance, tenure and market, stock options, 10% performance stock options and 80% PSUs. For Ms. West, Mr. Hardesty, Ms. Gates and Mr. Yeaw, the allocation was 10% market stock options, 10% performance stock options, 20% RSUs and 60% PSUs.with an aggregate target value as follows:

For the 2017 performance option grants to be exercisable, the share price must achieve at least $14.78 for any 15 trading days during the three-year service vesting period. The $14.78 share price represented a 50% increase over the closing price on the date of grant.

Mr. Rippey

$3,006,250

Ms. West

$706,580

Ms. Gates

$450,000

Mr. Hardesty

$432,600

Mr. Quanci(1)

$229,614

(1)

Mr. Quanci’s 2020 LTI award at the VP level had the allocation of 60% RSUs and 40% long-term cash.

2020-2022 PSU Award

The PSU grants have a three-year performance period, beginning on January 1, 20172020 and ending on December 31, 2019.2022. The two primary performance metrics, which are each weighted 50%, and goals for the grants were:

 

  Metric     Threshold 0%         Target 100%         Maximum 200%      
 

Cumulative Adjusted EBITDA

 $650M $750M $850M 
 

AveragePre-Tax ROIC (Coke, Logistics & Unallocated Corporate)

 9% 12% 15% 
   Metric     Threshold 0%         Target 100%         Maximum 200%      
  

Cumulative Adjusted EBITDA

 $560M $700M $749M 
  

Average Pre-Tax ROIC (Coke, Logistics & Unallocated Corporate)

 8.3% 10.4% 11.1% 

The average pre-taxOur long-term goals on EBITDA and ROIC target was set lower than 2016 targetsare determined based on our contracts and capital investment. As we otherwise continue to grow and diversify our business, our cumulative EBITDA goal decreased for our 2020 cycle due to forecasted changesthe bankruptcies of our CMT coal customers. We set goals that are aggressive and require continuous improvement in operating income primarily driven by lower productionoperations, including new business at Indiana Harbor and increased depreciation expense from an increased number of planned Indiana Harbor oven rebuilds in 2017.

CMT.

In addition, theThe award contains a modifier whichthat can increase or decrease the award payout by up to 50%with a multiplier of +/- 25% based on the Company’s Total Shareholder Return (TSR)TSR performance over the three-year performance periodperiod. The Company’s TSR is ranked relative to the TSR of each company that is part of the NASDAQ Iron & Steel Index. For each percentile thatIndex over the Company’s TSR exceeds or is below the 50th percentile of the defined index, the modifier will adjust the final payout by one percentage point upward or downward up to 50% and the payout will be capped at 250% of the target units.same period on a non-weighted basis. Performance in between threshold, target or maximum levels will be determined by straight linestraight-line interpolation. The payout is capped at 250% (inclusive of up to a 50% TSR modifier) of the target units. The Compensation Committee determines the level of achievement of the goals after the end of the performance period.

The goals for the long-term cash award are the same as the PSU awards with the exception of the relative TSR modifier, which is not used for these awards.

CEO2018-2020 PSU Award at Hire

On December 6, 2017, the Compensation Committee approved an equity award for Mr. Rippey in connection with his hire and appointment as President and CEO. This equity award represented the value of his target equity for fiscal year 2018. Mr. Rippey’s equity grant had a target value of $2,000,000 and consisted of a mix of 20% market stock options and 80% PSUs. The share price at grant was $10.80, based on the NYSE closing price on the date of Committee approval. The PSU grant has a three-year performance period beginning on January 1,for PSUs awarded for 2018 and endingended on December 31, 2020. Mr. Rippey, Ms. West, Ms. Gates and Mr. Hardesty received a payout. The two primary performance metrics, which are each weighted 50%, and goalspayout for the grant are:

  Metric     Threshold 0%         Target 100%         Maximum 200%      
 

Cumulative Adjusted EBITDA

 $700M $800M $900M 
 

AveragePre-Tax ROIC (Coke, Logistics & Unallocated Corporate)*

 8% 11% 14% 

PSUs was based on 50% three- year cumulative Adjusted EBITDA, and 50% based on achievement of three-year average pre-tax ROIC for the Coke and Logistics businesses plus unallocated corporate income. In addition, the award contains a modifier whichthat can increase or decrease the award payout by up towith a multiplier of +/- 25% based on the Company’s TSR performance over the three-year performance periodperiod. The Company’s TSR is ranked relative to the NASDAQ Steel and Iron Index. ForTSR of each percentilecompany that the Company’s TSR exceeds or is below the 50th percentilepart of the defined index,NASDAQ Iron & Steel Index over the same period on a non-weighted basis. If SunCoke achieved maximum

performance levels on all metrics and the modifier, will adjust the final payout by one percentage point upward or downward up to 25% and the payout willwould be capped at 250% of the target units. In the event that the Company’s TSR at the end the performance period is negative, the award cannot vest at more than 100% of target units, regardless of cumulative EBITDA orpre-tax ROIC performance. The level of payout of the PSUs varies from zero to 250%, although the Compensation Committee retains the discretion to reduce, but not to increase, the ultimate level of payout of such awards. Performance in between threshold, target or maximum levels, will be determined by straight line interpolation. The Compensation Committee determines the level of achievement of the goals after the end of the performance period.

*ThePre-Tax ROIC target for 2018- 2020 was adjusted from 12% to 11% to compensate for the decrease in deferred tax liabilities which impacts invested capital. In December 2017, the Federal Government passed the Tax Reform Act, which reduced the Company’s deferred tax liabilities and would increase invested capital, which in turn reducespre-tax ROIC.

2015-2017 PSU Award

The three-year performance period for PSUs awarded in 2015 ended on December 31, 2017. Mr. Henderson, Ms. West and Mr. Hardesty are the only NEOs to receive a payout, because the other NEOs were not eligible at the time of the grant. The payout for the PSUs was based 50% on TSR versus the S&P 600 and 50% based on achievement ofpre-tax ROIC for the Coke and Logistics business versus targetpre-tax ROIC.target. Based upon performance as shown in the following table, theythe NEOs received only 1.35%70.6% of thisthe target PSU grant and accumulated dividends.

 

 

SunCoke 2015-2017 Performance Share Metrics

 
                               
      Threshold  Target  Maximum            
   Weight  0%  100%  200%    

Final

Performance

  

Performance

Payout %

  

Adjusted 

Weight

 

  Avg 3 year SXC TSR VS

  3 Year S&P 600(2015- 2017)

  50%     

 

25th

percentile

 

 

 

 

  

 

50th

percentile

 

 

 

 

  

 

75th

percentile

 

 

 

 

   

 

12.71

percentile

 

 

 

 

  0.0%   0% 
          

  3 year avg pre-tax return on

  capital (“ROIC”) - Coke,   Logistics & Unallocated

  Corporate

  50%   

 

10.0%

 

 

 

  

 

13.0%

 

 

 

  

 

16.0%

 

 

 

   

 

10.08%

 

 

 

  2.7%   

 

1.35%

 

 

 

         

 

1.35%

 

 

 

 

  Performance between threshold, target and maximum will be adjusted proportionately

  3 Year TSR Calculation: (10-Day closing average - 10-day opening average) / 10-day opening average

 

 

 

 

SunCoke 2018-2020 Metrics for PSUs (Adj. EBITDA)

 

 
                             
      Threshold  Target  Maximum           
  
   

% of

Award

  0%  100%  200%    Results    Performance
Payout %
 
Three-year cumulative earnings before interest, taxes, depreciation and amortization (“Adj. EBITDA”).  50%     700   800   900    800.8    100.8% 
  

 

SunCoke 2018-2020 Metrics for PSUs (Pre-tax ROIC)

 

 
                             
      Threshold  Target  Maximum           
  
   

% of

Award

  0%  100%  200%    Results    Performance
Payout %
 
Three-year average pre-tax return on invested capital (“ROIC”), including coke, logistics and unallocated corporate cost, but excluding discontinued operations and legacy costs [e.g., Black Lung, pensions and other postemployment benefits]  50%     8.0%   11.0%   14.0%    10.6%    87.5% 
  

 

SunCoke 2018 - 2020 TSR Modifier and Final PSU Award Payout

 

    
                             
  

At the end of the three-year performance period (December 31, 2020), the number of vested PSUs was determined as set forth above. Performance between threshold, target and maximum values were adjusted proportionately. Once determined, the number of vested PSUs was multiplied by a TSR Modifier, and the product is the number of shares of SunCoke common stock to be paid in settlement of the vested PSUs. In the event that SunCoke’s TSR performance is negative, the overall payout of the award is capped at 100%. The TSR Modifier can range from 75% to 125% based on the 3-year TSR of SunCoke common stock relative to the common stock of companies within the NASDAQ Iron & Steel Index. Based on the TSR of SunCoke common stock for the 2018 - 2020 period, the TSR modifier was 75%.

 

   


Payout Pre-
TSR Modifier

(.5 x 100.8%)
+ (.5 x 87.5%)


 

 
 

   94.1% 
   TSR Modifier    75.0% 
   

Final PSU

Award Payout


 

   

 

70.6%

 

 

 

              

Based on the Company’s TSR andpre-tax ROIC over the three-year period no shares vested based on TSR performance, and only 2.7% of the portion of the grant related topre-tax ROIC vested. While disappointing, this further demonstrates the linkage between performance and realizable pay. In approving the final payout of the 20152018 PSU Award, the Compensation Committee approved adjustments in lineto Adjusted EBITDA and pre-tax ROIC that were consistent with our general principles of how to treat unusual, unplanned items as they occur, in determiningpre-tax ROIC. The net effect of these adjustments increased the approvedpre-tax ROIC performance from 8.3% to 10.08%.occur. Details on the adjustments follow:

Adjusted EBITDA for 2019 was adjusted $30.8 million due to the unplanned fourth quarter coal export customer bankruptcy filing, while Adjusted EBITDA for 2020 was adjusted $53.1 million due to a second coal export customer bankruptcy.

In calculating thepre-tax ROIC, $30.8 million of Coal Logistics revenue was added back into the Compensation Committeeconsolidated adjusted operating income for 2019 and $53.1 million for 2020, while lower depreciation and amortization costs due to the resulting asset impairment of that bankrupt coal export customer were excluded in the amounts of $2.8 million for 2019 and $11.2 million for 2020. Invested capital was also adjusted so as to remove the impact of changes to the Company’s deferred tax liabilities which impact invested capital. In early 2017 the Company received an adverse ruling on the tax qualificationasset impairment of SunCoke Energy Partners, L.P. our master limited partnership (‘MLP”), which increased our deferred tax liability and would have increasedpre-tax ROIC. In December 2017, the Federal Government passed the Tax Reform Act, which reduced the Company’s deferred tax liabilities and would have reducedpre-tax ROIC. The net effect of these two adjustments reducedpre-tax ROIC over the performance period by 1.9%.

Operating Income was adjusted for the effect of costs transferred to the Jewell Coke plant in connection with the divestiture of the Company’sthat bankrupt coal operations. These costs included shared administrative costs, as well as coal handling, blending and price adjustments that were transferred to the Coke plant in the amount of $6.4 million in 2016 and ($0.8 million) in 2017. The Compensation Committee also adjusted for lost revenue and unanticipated costs in the amount of $25.9 million related to the bankruptcy andnon-performance of a steam and water sharing agreement with the Haverhill Chemical plant, which is independent of SunCoke.

The Compensation Committee excluded the impact of the Board-approved transaction whereby ArcelorMittal redeemed SunCoke’s preferred and common equity interest in Sol Coqueria Tubarao S.A. for $41.0 million in consideration. This transaction, which was not anticipated in the 2016 or 2017 plan, negatively impacted Operating Income by $4.4 million in each year, but was an attractive transaction for stockholders.export customer.

During 2017, the Company initiated discussions to purchase the outstanding units of SunCoke Energy Partners, L.P. While management and the Board of Directors continue to believe in the merits of a combined SunCoke structure, ultimately the Company could not agree upon terms with the Conflicts Committee of SunCoke Energy Partners’ Board of Directors. Legal and investment banking costs in the amount of $1.8 million related to this and other transactions, which were ultimately not concluded, have been excluded from the Operating Income calculation.

Finally, the Compensation Committee excluded the impact of accelerated depreciation in the cumulative amount of $32.4 million associated with the rebuild of ovens at the Indiana Harbor Coke Plant andre-plating of spray dryer absorber equipment at our Middletown and Haverhill cokemaking facilities. This depreciation would have been incurred in future years had the projects not been accelerated.

SECTION 6 -- OTHER COMPENSATION INFORMATION

Perquisites

We do not provide our NEOs with perquisites or other personal benefits such as company vehicles, club memberships, financial planning assistance or tax preparation. The Company may reimburse relocation costs for newly retained or relocated NEOs.NEOs or provide a partial commuting allowance.

Stock Ownership Guidelines

Under our stock ownership guidelines, our executives are required to maintain direct ownership in our common stock in the following amounts:

 

  

CEO: Five times annual base salary

 

  

Senior Vice Presidents and above: Three times annual base salary

 

  

Vice Presidents: One times annual base salary

Under the guidelines:

A newly hired executive has five years to meet the ownership requirements. If an executive’s ownership requirement increases due to a promotion, the executive has five years to meet the increased level.

NEOs are required to hold 100% of any newly vested shares (other than shares sold to pay taxes upon vesting)taxes) until they meet 100% of the share ownership guidelines. Other executives must hold at least 50% of any newly vested shares (other than shares sold to pay taxes upon vesting)taxes) until they meet 100% of the share ownership guidelines.

Time-based restricted share units and shares held directly or indirectly, including shares acquired on exercise of stock options and shares held under our retirement plans, count toward these guidelines. Outstanding stock options (vested and unvested) as well as unearned performance-based restricted share units do not count toward these guidelines.

As of December 31, 2017, Mr. Henderson and Mr. Hardesty had2020, all of our executives either have met more than 100%in full or are on track to meet their ownership requirements at the end of their ownership requirements. Mr. Rippey, as a new employee, has five years to meet the ownership requirement for the CEO. Due to prior promotions, Ms. West has two remaining years in which to meet her ownership requirement, and Ms. Gates and Mr. Yeaw have four years in which to meet the requirement.

guideline period.

Hedging and Pledging Policies

Our Insider Trading Policy prohibits short sales of Company stock, as well as the purchase, sale, or exercise of any puts, calls, or other options (other than options granted pursuant to any incentive compensation plan of the Company) on Company stock, or “hedging.” Our Insider Trading Policy also prohibits employees, officers and directors of the Company from pledging Company stock as collateral for any loan or depositing any Company stock in a margin account.

Recoupment Policy

Our recoupment, or “claw back,” policy allows for recoupment of incentive compensation, with a three-year look-back. Under this policy, if the Company restates its financial statements, or if an officer of the Company violates a Company policy or confidentiality covenant, or engages in conduct detrimental to the Company’s business or reputation, the Compensation Committee has the discretion to cancel outstanding awards of, or opportunities to receive, cash or equity incentive compensation and to recoup incentive compensation already paid or awarded to an officer during the three-year period preceding the date the restatement obligation was determined or the date of the officer’s misconduct.

Retirement Benefits

 

  

SunCoke 401(k) Plan:SunCoke Energy offers all its employees, including the NEOs, the opportunity to participate in the SunCoke 401(k) Plan, which is a tax qualified defined contribution plan with 401(k) and profit sharing features designed primarily to help participating employees accumulate funds for retirement. Our employees may make elective contributions of up to 80% of eligible pay up to annual IRS limits, and we make companyCompany contributions generally

consisting of a matching contribution equal to 100% of employee contributions up to 5% of eligible compensation and an employeranother Company contribution equal to 3% of eligible compensation. All NEOs are eligible to receive these contributions.

 

  

Savings Restoration Plan:The Savings Restoration Plan, or SRP, is an unfunded, nonqualified deferred compensation plan that is made available to participants in the SunCoke 401(k) Plan whose compensation exceeds the IRS limits on compensation that can be considered under that Plan ($270,000285,000 for 2017)2020). Under the SRP, employees can make an advance election to defer on apre-tax basis up to 50% of the portion of their salary and bonus that exceeds the compensation limit. EmployerCompany contributions will be credited to the accounts of each employee who elects to defer compensation and they consist of (1) a matching Company contribution equal to 100% of the first 5% of compensation deferred by the participant under the SRP and (2) an additional Company contribution equal to 3% of the compensation deferred by the participant under the SRP. SunCoke Energy can also make additional discretionary contributions. As a cost reduction measure, the Company suspended all Company contributions to the SRP beginning January 1, 2016, which saved approximately $250,000 in 2016. Employer contributions were reinstated beginning January 1, 2017. Our NEO’s have no defined benefit pension or other post-retirement benefits. The qualified Savings (401k) Plan and the Savings Restoration Plan are the only Company-sponsored retirement income vehicles for NEOs.

The 401(k) Plan and the Savings Restoration Plan are the only Company-sponsored retirement income vehicles for NEOs. Our NEOs have no defined benefit pension or other post-retirement benefits.

Severance and Change in Control Benefits

Our NEOs participate in the SunCoke Energy Executive Involuntary Severance Plan and the SunCoke Energy Special Executive Severance Plan. The purpose of these plans is to recognize an executive’s service to SunCoke Energy and provide a market competitive level of protection and assistance if an executive is involuntarily terminated. The Special Executive Severance Plan is also designed to reinforce and encourage the continued attention and dedication of senior executives of SunCoke Energy in the event of a possible major transaction. These plans are described in detail in the “Potential Payments upon Termination or Change in Control” section of this proxy statement.

Other SunCoke Energy Benefits

Our NEOs participate in the same basic benefits package and on the same terms as other eligible SunCoke Energy employees. The benefits package includes the savings program described above, as well as medical and dental benefits, disability benefits, insurance (life travel and accident)travel), death benefits and vacations and holidays.

CEO Pay Ratio

Our CEO to median employee pay ratio is calculated in accordance with Item 402(u) of RegulationS-K. The median employee was identified from all full-time and part-time employees (including temporary employees), excluding the CEO, who were employed by the Company on November 30, 2017. Mr. Henderson’s compensation is used for the calculation of the CEO pay ratio.

The median employee compensation was determined using 2017W-2 (Box 5) compensation, and a similar compensation measure for ournon-U.S. employees, who are located in Brazil. Wages were annualized for ournon-temporary employees who did not work the entire calendar year. For our Brazil employees, we applied a Brazil to U.S. dollar exchange rate to the compensation elements paid on Brazil currency, consistent with published income statements, but did not apply a cost of living adjustment.

Mr. Henderson had 2017 annual total compensation of $4,708,216 as reflected in the Summary Compensation Table included in this Proxy Statement. The median employee’s annual total compensation for 2017 that would be reportable in the Summary Compensation Table was $87,161. As a result, the CEO pay ratio is 54:1.

Tax Deductibility of Compensation

Section 162(m) of the Internal Revenue Code, as in effect for 2017, generally precluded a public corporation from taking a deduction for compensation more than $1 million for its CEO and the three most highly compensated officers, other than the CFO, unless the compensation qualified as performance-based compensation. While base salary and time-based restricted share units by their nature do not qualify as performance-based compensation under Section 162(m), we have structured the stock options and the performance share units under the LTPEP and the annual incentive awards under the SEIP and AIP to so qualify.

The Tax Cuts and Jobs Act of 2017 amended Section 162(m) to cover a public company’s chief financial officer and eliminate the performance based exception, beginning in 2018. Accordingly, the annual incentive awards, stock options and PSUs granted in 2018 and later years will no longer qualify for this exception. In addition, compensation paid to a covered employee after termination of employment will also be subject to the million-dollar limitation. The annual incentive awards paid for 2017 will still be covered by the performance-based exception. Under a transition rule, outstanding stock options and PSUs and post-termination compensation will not be subject to Section 162(m) as amended to the extent such compensation is considered paid pursuant to a binding written contract in effect as of November 2, 2017.

Assessment of Risk Related to Compensation Practices

In February 2017,2020, our Compensation Committee, in consultation with CAP, considered whether our compensation policies and practices for our employees, including the NEOs, were reasonably likely to have a material adverse effect on SunCoke Energy. In concluding that this was not the case, the Compensation Committee determined that our executive compensation program was consistent with SunCoke Energy’s risk management strategies. In the case of employees below the Senior Vice President level, salary is generally a significant portion of their compensation. In the case of the NEOs, annual cash incentive compensation awards were based on fivefour different corporate metrics (which limited excessive reliance on any one metric), target goals were set at appropriate levels and payments were capped at 200% of an individual target. Long-term incentive awards, which consist of market and performance-based stock options, restricted share units and performance share units, contain multi-year vesting periods, thus promoting employee retention and aligning management’s interest with those of our stockholders.shareholders. Our stock ownership requirements help further align the interests of executives with those of stockholders.shareholders.

Accounting and Tax Considerations

While the tax impact of any compensation arrangement is one factor to be considered, such impact is evaluated in light of the Company’s overall compensation philosophy and objectives. The Company believes that maintaining the discretion to evaluate the performance of executive officers is an important part of the Company’s responsibilities and benefits public shareholders, and therefore, the Company may award compensation to the Named Executive Officers that is not fully deductible if it is determined that such compensation is consistent with the Company’s compensation philosophy and benefits shareholders.

Section 409A of the Code requires that “nonqualified deferred compensation” be deferred and paid under plans or arrangements that satisfy the requirements of the statute with respect to the timing of deferral elections, timing of payments, and certain other matters. Failure to satisfy these requirements can expose employees and other service providers to accelerated income tax liabilities and penalty taxes and interest on their vested compensation under such plans. Accordingly, as a general matter, it is the Company’s intention to design and administer its compensation and benefits plans and arrangements for all employees and other service providers, including the executive officers, so that they are either exempt from, or satisfy the requirements of, section 409A of the Code.

Any equity awards granted to our employees, including executive officers, pursuant to the LTPEP are reflected in the Company’s consolidated financial statements, based upon the applicable accounting guidance, at fair market value on the grant date in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification, Topic 718, “Compensation --Stock Compensation.”

Summary Compensation Table

The following table sets forth compensation information for our NEOs for the fiscal years ended December 31, 2017,2020, December 31, 20162019 and December 31, 2015:2018:

 

Named Executive

Officer

   Year   Salary
    ($)    
 Bonus
  ($)  
 Stock
Awards
($)(1)
 Option
Awards
($)(2)
 Non-Equity
Incentive Plan
Compensation
($)(3)
 All Other
Compensation
($)
 Total
($)
    Year   Salary
    ($)    
 Bonus
  ($)  
 Stock
Awards
($) (1)
 Option
Awards
($) (2)
 Non-Equity
Incentive Plan
Compensation
($) (3)
 All Other
Compensation
($)
 Total
($)
 

Michael G. Rippey(4)

         2020  909,615    2,203,220      740,000   160,867(4)   4,013,702 

President & CEO

 2017  $60,577  $0  $1,769,020   $399,997   $0   $0(5)   $2,229,594  2019  813,462    2,269,637   536,248   1,100,550   135,859   4,855,756 
 2018  750,000    (5)   (5)   884,250   36,923   1,671,173 

Frederick A. Henderson

 2017  $850,000  $0  $2,039,999   $509,996   $1,074,188   $234,033(7)   $4,708,216 

Former Chairman,

 2016  $850,000  $0  $1,986,646   $472,765   $1,461,150   $21,200   $4,791,761 

President & CEO

 2015  $1,012,500(6)  $0  $2,633,322   $1,382,659   $761,475   $130,009   $5,919,965 

Fay West

 2017  $460,000  $0  $331,199   $82,793   $558,072   $87,407(8)   $1,519,471  2020  502,438    517,836      282,632   76,830(6)   1,379,737 

Sr. VP & CFO

 2016  $460,000  $0  $499,815   $67,172   $632,592   $21,200   $1,680,779  2019  487,692    580,683   137,199   457,562   68,501   1,731,637 
 2015  $431,539(6)  $0  $389,210   $241,389   $240,051   $45,200   $1,347,389  2018  469,808    547,282   128,797   368,282   82,246   1,596,415 

Katherine T. Gates

 2020  450,000    329,788      252,000   104,642(7)   1,136,430 

Sr. VP, Chief Legal

 2019  421,385    355,510   83,996   350,175   96,022   1,307,088 

Officer & CHRO

 2018  396,346    322,912   75,998   272,608   98,335   1,166,198 

Phillip M. Hardesty

 2017  $380,000  $0  $182,393   $45,596   $403,389   $117,596(9)   $1,128,974  2020  430,662    317,039     242,256   116,653(8)   1,106,610 

Sr. VP, Com Ops, BD,

 2016  $380,000  $0  $275,263   $36,992   $457,254   $71,200   $1,220,709 

Sr. VP, Com Ops, BD

 2019  417,692    355,510   83,996   392,196   109,442   1,358,837 

Int’l Coke & Terminals

 2015  $360,000(6)  $0  $441,379   $101,346   $154,247   $91,338   $1,148,310  2018  396,346    322,912   75,998   317,090   114,639   1,226,984 

Katherine T. Gates

 2017  $380,000  $0  $227,988   $56,995   $326,553   $96,868(10)   $1,088,404 

Sr. VP, GC, Chief

 2016  $356,923  $0  $205,237   $27,583   $324,700   $61,200   $975,643 

Compliance Officer

 2015  $295,329(6)  $0  $74,191   $40,081   $93,185   $75,143   $577,929 

Gary P. Yeaw

 2017  $375,000  $0  $149,991   $37,492   $284,344   $55,785(11)   $902,612 

Sr. VP, Human

 2016  $375,000  $0  $226,364   $30,421   $322,312   $21,200   $975,297 

Resources

 2015  $366,082(6)  $0  $175,861   $95,011   $133,125   $40,289   $810,368 

John F. Quanci

 2020  380,974    137,766      337,756(9)   61,436(10)   917,933 

VP, Chief Technology Officer

 2019  369,862    100,309   33,436   386,289   52,655   942,551 

 

(1)

The amounts reported in this column reflect the grant date fair value of restricted share unit and performance share unit awards made under the LTPEP to the NEOs listed in this table.table, determined in accordance with FASB ASC Topic 718. The performance share unit amounts are based on the probable outcome of the performance conditions. See Note 1516 to the Form10-K in the 20172020 Annual Report for a complete description of the assumptions used for these valuations. TheFor 2020, the grant date fair value of the performance share unit awards were as follows, assuming the performance conditions of such awards are achieved at their maximum (250%) potential levels:

 

 

  NEO

              2017($2020($)            

Michael G.  Mike Rippey

  4,422,551    2,501,806

Frederick A. Henderson

5,099,998  

Fay West

  620,999  588,016

  Katherine T. Gates

374,474

Phillip M. Hardesty

  341,991  

Katherine T. Gates

427,489  

Gary P. Yeaw

281,231  359,997

 

(2)

The amounts reported in this column reflect the grant date fair value of stock option awards made under the LTPEP to the NEOs, determined in accordance with FASB ASC Topic 718. See Note 1516 to the Form10-K in the 20172020 Annual Report for a complete description of the assumptions used for these valuations.

 

 

(3)

The amounts in this column reflect annual cash incentive payments to each NEO under our Annual Incentive Plan and Senior Executive Incentive Plan.the AIP. A description of these plansthis plan can be found in the Compensation Discussion and Analysis section of this proxy statement.

 

 

(4)

The All Other Compensation column for 2020 includes (i) $138,066 representing Company matching and annual contributions to the Savings Restoration Plan; and (ii) $22,800 representing Company matching and annual contributions to the SunCoke 401(k) Plan.

(5)

Mr. Rippey was hired as President and CEO effective December 1, 2017. As a part of his compensation package upon hire, he was granted an equity award with a market value of $2,000,000 comprised of 80% PSUs and 20% market options.on December 6, 2017; therefore he did not receive an additional equity award in 2018.

 

 

(5)

Mr. Rippey did not have any Company matching and annual contributions to the SunCoke 401(k) plan as he was not eligible due to his start date and asix-month waiting period for Company contributions.

(6)

Due to the timing of pay periods, salary for 2015 reflects 27 pay periods rather than the usual 26 pay periods.

(7)

The All Other Compensation column for 20172020 includes (i) $163,293 representing Company matching and annual contributions to the Savings Restoration Plan; (ii) $21,600 representing Company matching and annual contributions to the SunCoke 401(k) Plan; and (iii) Mr. Henderson’s vacation payout of $49,140.

(8)

The All Other Compensation column for 2017 includes (i) $65,807$54,025 representing Company matching and annual contributions to the Savings Restoration Plan; and (ii) $21,600$22,800 representing Company matching and annual contributions to the SunCoke 401(k) Plan.

 

 

(9)(7)

The All Other Compensation column for 20172020 includes (i) $45,996$41,842 representing Company matching and annual contributions to the Savings Restoration Plan; (ii) $21,600$22,800 representing Company matching and annual contributions to the SunCoke 401(k) Plan; and (iii) $40,000 as a commuting allowance.

(8)

The All Other Compensation column for 2020 includes (i) $43,853 representing Company matching and annual contributions to the Savings Restoration Plan; (ii) $22,800 representing Company matching and annual contributions to the SunCoke 401(k) Plan; and (iii) $50,000 as a commutation stipend.commuting allowance.

(9)

Mr. Quanci’s Non-Equity Incentive Plan compensation includes a payment under the Long Term Cash Incentive Plan (LTIP). His 2018 award vested under the LTIP based on performance during the period of 2018 – 2020 and consisted of 50% three year cumulative adjusted EBITDA and 50% pre-tax ROIC with a modifier based on TSR.

 

 

(10)

The All Other Compensation column for 20172020 includes (i) $35,268 representing Company matching and annual contributions to the Savings Restoration Plan; (ii) $21,600 representing Company matching and annual contributions to the SunCoke 401(k) Plan; and (iii) $40,000 as a commutation stipend.

(11)

The All Other Compensation column for 2017 includes (i) $34,185$38,636 representing Company matching and annual contributions to the Savings Restoration Plan; and (ii) $21,600$22,800 representing Company matching and annual contributions to the SunCoke 401(k) Plan.

 

CEO Pay Ratio

As provided for by the Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC requires companies to disclose the ratio of the median employee’s total annual compensation relative to total annual compensation of the CEO. As disclosed in the “Summary Compensation Table”, the 2020 total annual compensation for our CEO was $4,013,702. We estimate that the 2020 total annual compensation for the median employee out of all our employees, excluding our CEO, that would be reportable in the Summary Compensation Table, was $82,161. The resulting ratio of our CEO’s total annual compensation to that of the median employee, excluding our CEO, for 2020 is approximately 49 to 1.

The pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on our internal records and the methodology described above. The SEC rules for identifying the median employee and calculating the pay ratio based on that employee’s total annual compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Therefore, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios.

20172020 Grant of Plan-Based Awards Table

The following table sets forth the plan-based grants made during the fiscal year ended December 31, 2017:2020:

 

     

Estimated Future Payouts Under

Non-Equity Incentive Plan  awards (1)

  

Estimated Future Payouts Under

Equity Incentive Plan awards (2)

                     

Estimated Future Payouts Under

Non-Equity Incentive Plan awards 

  

Estimated Future Payouts Under

Equity Incentive Plan awards (1)

                

Named

Executive Officer

 Grant
Date
  

Threshold

($) (3)

  

Target

($)

   

Maximum

($)

  

Threshold

(#) (4)

  

Target

(#)

  

Maximum

(#)

  

All Other
Stock
Awards:

No. of
Shares of
Stock or
Units

(#) (5)

  

All Other
Option
Awards:

No.

of
Securities
Underlying
Options

(#) (6)

  Exercise or
Base Price
of  Option
Awards
($/Share)
(7)
  

Grant Date
Fair Value
of Stock
and Option
Awards

(8)

 Grant
Date
  

Threshold

($)

  

Target

($)

   

Maximum

($)

  

Threshold

(#) (2)

  

Target

(#)

  

Maximum

(#)

  

All Other
Stock
Awards:

No. of
Shares of
Stock or
Units

(#) (3)

  

All Other
Option
Awards:

No. of
Securities
Underlying
Options

(#) (4)

  Exercise or
Base Price
of Option
Awards
($/Share)
  Grant Date
Fair Value
of Stock
and  Option
Awards
($) (5)

M.G Rippey

                        
 12/6/2017             148,148   370,370         1,769,020
 12/6/2017                   72,864   10.80  399,997

F.A. Henderson

      1,062,500    2,125,000                
 2/15/2017             178,952   447,380         2,039,999
 2/15/2017                   56,085   9.85  254,996
 2/15/2017                   49,323   9.85  255,000

M. Rippey

    231,250(6)   925,000(7)    1,850,000                
   (8)   901,875(9)    2,254,688                
 2/19/2020             149,317   373,293         1,000,723
 2/19/2020                199,089      1,202,498

F. West

       552,000    1,104,000                    88,323(6)   353,290(7)    706,580                
 2/15/2017             21,790   54,475         248,399    (8)   211,974(9)    529,935                
 2/15/2017                8,406    9.85  82,799  2/19/2020             35,095   87,738         235,207
 2/15/2017                   9,105   9.85  41,397  2/19/2020                46,793      282,630
 2/15/2017                   8,007   9.85  41,396

K. Gates

    78,750(6)   315,000(7)    630,000                
   (8)   135,000(9)    337,500                
 2/19/2020             22,350   55,875         149,790
 2/19/2020                29,801      179,998

M. Hardesty

       399,000    798,000                    75,705(6)   302,820(7)    605,640                
 2/15/2017             12,000   30,000         136,796    (8)   129,780(9)    324,450                
 2/15/2017                4,629    9.85  45,596  2/19/2020             21,486   53,715         143,999
 2/15/2017                   5,014   9.85  22,797  2/19/2020                28,649      173,040
 2/15/2017                   4,410   9.85  22,800

K. Gates

       323,000    646,000                
 2/15/2017             15,000   37,500         170,996
 2/15/2017                5,786    9.85  56,992
 2/15/2017                   6,268   9.85  28,498
 2/15/2017                   5,512   9.85  28,497

G. Yeaw

       281,250    562,500                
 2/15/2017             9,868   24,670         112,492
 2/15/2017                3,807    9.85  37,499
 2/15/2017                   4,123   9.85  18,746
 2/15/2017                   3,626   9.85  18,746

J. Quanci

    62,187(6)   248,750(7)    497,499                
   (8)   126,072(9)    315,180                
                       
 2/19/2020                22,809      137,766

 

 (1)

The amounts in these columns were established under the AIP. These estimated payouts were based onpre-established goals for 2017. Thus, the amounts shown in the columns reflect the range of potential payments when the performance goals were set in early 2017. Actual amounts paid for 2017 are shown in the Summary Compensation Table. A description of the AIP can be found in the Compensation Discussion and Analysis section of this proxy statement.

(2)

The amounts reported in these columns represent the target number of performance share units granted to each NEO, and the range of the potential number of performance share units that may be issued to each NEO for the 2017-20192020—2022 performance period. Mr. Rippey joined SunCoke on December 1, 2017, therefore his award has the performance period of 2018-2020 and is consistent with other PSU awards granted to the other NEOs in February 2018. Each unit represents the right to receive a share of Company common stock. Terms applicable to the performance share units grant reported in this column are described in the Long-Term Performance Enhancement Plan (LTPEP) section of the Compensation Discussion and Analysis. In general, these performance share units vest on the third anniversary date of the grant subject to a risk of forfeiture by participant, with the payout of such PSUs being conditioned upon performance goals and continued employment at SunCoke Energy until the date the Compensation Committee determines the payout levels. The awards are also subject topro rata vesting upon retirement and accelerated vesting of the target amount upon death, disability, or a qualifying termination following a change in control of SunCoke Energy. Dividend equivalents are paid to the extent the award vests.

 

 

 (3)

Under the AIP, no payment is made until a minimum performance level is met, and performance at or above such level will result in a payment ranging from $1 to the maximum amount, subject to the approval of the Compensation Committee.

(4)(2)

Under the performance share unit award agreement, no payment is made until a minimum performance level is met, and performance at or above such level will result in a payment ranging from one share to the maximum amount, subject to the approval of the Compensation Committee.

 

 

 (5)(3)

This column reflectreflects the number of restricted share units granted to our NEOs, excluding the CEO and former CEO in 2017.NEOs. In general, these awards vest on the first, second and third anniversary date of the grant, subject to continued employment with SunCoke Energy and subject to(or continued vesting upon retirement after the year of grant,grant), and accelerated vesting upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

 

 

 (6)(4)

This column reflects the number of stock options granted to our NEOs in 2017. In general, these awards vest on the first, second and third anniversary date of the grant, subject to continued employment with SunCoke Energy and subject to continued vesting upon retirement after the year of grant, and accelerated vesting upon death, disability or a qualifying termination following a change in control of SunCoke Energy. For the February 2017 awards, half of theNo stock options were market-basedgranted in 2020, as described in the Long-Term Performance Enhancement Plan (LTPEP) section of the Compensation Discussion and half were performance based with a stock price hurdle of $14.78 for any 15 days during the performance period. For the award made to Mr. Rippey, all options are market options.Analysis

 

 

 (7)

The exercise price is equal to the closing price of our common stock on the date of grant.

(8)(5)

The grant date fair value was calculated in accordance with FASB ASC Topic 718. See Note 1516 to the Form10-K in the 20172020 Annual Report for a complete description of the assumptions used for these valuations.

 

(6)

Under the AIP, no payment is made until a minimum performance level is met, and performance at or above such level will result in a payment ranging from 25% to the maximum amount, subject to the approval of the Compensation Committee.

(7)

The amounts in these columns were established under the AIP. These estimated payouts were based on pre-established goals for 2020. Thus, the amounts shown in the columns reflect the range of potential payments when the performance goals were set in early 2020. Actual amounts paid for 2020 are shown in the Summary Compensation Table. A description of the AIP can be found in the Compensation Discussion and Analysis section of this proxy statement.

(8)

Under LTIP, no payment is made until a minimum performance level is met, and performance at or above such level will result in a payment ranging from one dollar to the maximum amount, subject to the approval of the Compensation Committee.

(9)

Amounts reflect a long-term performance cash award made under the LTIP. Awards will vest based on performance during the period of 2020 – 2022 and consists of 50% three-year cumulative Adjusted EBITDA and 50% three-year pre-tax ROIC. In general, these long term performance cash awards on the third anniversary date of the grant subject to a risk of forfeiture by participant, with the payout of such award being conditioned upon performance goals and continued employment at SunCoke Energy until the date the Compensation Committee determines the payout levels. The awards are also subject to pro rata vesting upon retirement and accelerated vesting of the target amount upon death, disability, or a qualifying termination following a change in control of SunCoke Energy.

20172020 Outstanding Equity Awards at FiscalYear-End Table

The following table sets forth the outstanding equity awards as of December 31, 2017:2020:

 

  
 Option Awards  Stock awards  Option Awards  Stock awards 

Named

Executive

Officer

 

No. of

Securities

Underlying

Unexercised

Options

Exercisable

(#)

  

No. of

Securities

Underlying

Unexercised

Options

Unexercisable

(#)

  

Option

Exercise Price

($)

  

Option

Expiration

Date

  

No. of Shares

or Units of

Stock That

Have Not

Vested

(#)

  

Market Value

of Shares or

Units of Stock

That Have Not

Vested

($)(1)

  

Equity

Incentive Plan

Awards: No.

of Unearned

Shares, Units,

or Other

Rights that

Have Not

Vested

(#)(2)

  

Equity

Incentive Plan

Awards:

Market Value

of Unearned

Shares, Units,

or Other

Rights that

Have Not

Vested

($)(1)

  

No. of

Securities

Underlying

Unexercised

Options

Exercisable

(#)

  

No. of

Securities

Underlying

Unexercised

Options

Unexercisable

(#)

  

Option

Exercise Price

($)

  

Option

Expiration

Date

  

No. of Shares

or Units of

Stock That

Have Not

Vested

(#)

  

Market Value

of Shares or

Units of Stock

That Have Not

Vested

($) (1)

  

Equity

Incentive Plan

Awards: No.

of Unearned

Shares, Units,

or Other

Rights that

Have Not

Vested

(#) (2)

  

Equity

Incentive Plan

Awards:

Market Value

of Unearned

Shares, Units,

or Other

Rights that

Have Not

Vested

($) (1)

 
Michael G. Rippey    72,864(3)   10.80   12/6/2027        148,148   1,776,295   72,864      10.80   12/6/2027   253,419(3)   1,102,373   285,145   1,240,381 

Frederick A.

Henderson

  646,464      17.39   7/21/2021   14,423(4)   172,932   238,761   2,862,744 
 393,386      14.28   2/15/2022          
 231,250      16.55   2/20/2023          
 201,724      22.30   2/26/2024          
 181,449   90,728(5)   16.90   2/18/2025          
 30,308   60,617(6)   6.03   3/16/2026          
 30,308   60,617(7)   6.03   3/16/2026          
   49,323(8)   9.85   2/15/2027          
   56,085(9)   9.85   2/15/2027          
Michael G. Rippey  43,703   87,409(4)   9.87   2/13/2029          
  31,515      17.39   7/21/2021   14,429(10)   173,004   108,947   1,306,275   31,515      17.39   7/21/2021   64,785(5)   281,815   69,846   303,830 

Fay West

 8,034      16.55   2/20/2023            8,034      16.55   2/20/2023          
 8,069      22.30   2/26/2024            8,069      22.30   2/26/2024          
 21,835   10,919(5)   16.90   2/18/2025            32,754      16.90   2/18/2025          
 26,454   13,228(11)   8.37   10/1/2025            39,682      8.37   10/1/2025          
 8,070   16,141(6)   3.80   2/17/2026            24,211      3.80   2/17/2026          
 8,069   16,141(7)   3.80   2/17/2026            24,210      3.80   2/17/2026          
   8,007(8)   9.85   2/15/2027            8,007      9.85   2/15/2027          
   9,105(9)   9.85   2/15/2027            15,959   7,981(6)   10.49   2/14/2028          
  40,000      13.75   9/12/2021   16,435(12)   197,056   60,000   719,400 

Phillip M. Hardesty

 13,344      16.55   2/20/2023          
 12,368      22.30   2/26/2024          
 13,299   6,651(5)   16.90   2/18/2025          
 4,444   8,889(6)   3.80   2/17/2026          
 4,444   8,889(7)   3.80   2/17/2026          
   4,410(8)   9.85   2/15/2027          
   5,014(9)   9.85   2/15/2027          
 11,181   22,364(4)   9.87   2/13/2029          

Katherine T. Gates

  2,400      16.55   2/20/2023   7,249(13)   86,916   50,789   608,960   2,400      16.55   2/20/2023   40,725(7)   177,154   43,626   189,773 
 1,986      22.30   2/26/2024            1,986      22.30   2/26/2024          
 5,259   2,631(5)   16.90   2/18/2025            7,890      16.90   2/18/2025          
 3,313   6,629(6)   3.80   2/17/2026            9,942      3.80   2/17/2026          
 3,313   6,628(7)   3.80   2/17/2026            9,941      3.80   2/17/2026          
   5,512(8)   9.85   2/15/2027        ��    5,512      9.85   2/15/2027          
   6,268(9)   9.85   2/15/2027            9,417   4,709(6)   10.49   2/14/2028          

Gary P. Yeaw

  40,404      17.39   7/21/2021   7,275(14)   87,227   49,341   591,599 
 11,375      16.55   2/20/2023          
 9,703      22.30   2/26/2024          
 12,468   6,235(5)   16.90   2/18/2025          
 3,654   7,311(6)   3.80   2/17/2026          
 3,654   7,310(7)   3.80   2/17/2026          
   3,626(8)   9.85   2/15/2027          
   4,123(9)   9.85   2/15/2027          
Katherine T. Gates  6,845   13,692(4)   9.87   2/13/2029          
  40,000      13.75   9/11/2021   39,573(8)   172,143   42,762   186,015 
 13,344      16.55   2/20/2023          
 12,368      22.30   2/26/2024          
 19,950      16.90   2/18/2025          
 8,889      3.80   2/17/2026          
 8,889      3.80   2/17/2026          
 4,410      9.85   2/15/2027          

P. Michael Hardesty

 9,417   4,709(6)   10.49   2/14/2028          
 6,845   13,692(4)   9.87   2/13/2029          
  18,182      17.39   7/21/2021   31,587(9)   137,403       
 5,290      16.55   2/20/2023          
 5,028      22.30   2/26/2024          
 9,406      16.90   2/18/2025          
 4,532      3.80   2/17/2026          
 2,630      9.85   2/15/2027          
 2,603   1,302(6)   10.49   2/14/2028          

John F. Quanci

 2,724   5,451(4)   9.87   2/13/2029          

 

 (1)

The market value of these shares is based on the closing price of SunCoke Energy common stock on December 31, 2017 or $11.99.2020, which was $4.35.

 (2)

These shares reflect the target number of performance share units granted on February 17, 201613, 2019 for the 2016-20182019—2021 performance period and the target number of performance share units granted on February 15, 201719, 2020 for the 2017-2019 performance period to each NEO other than Mr. Rippey. Mr. Rippey’s amount reflects the target number of performance share units granted on December 6, 2017 for the 2018- 20202020—2022 performance period.

 

 (3)

One-third54,330 of these optionsrestricted share units were granted on February 13, 2019, of which one-half will vest on each of the second and third anniversary of the grant date. 199,089 of these restricted share units were granted on February 19, 2020, of which one-third will vest on each of the first, second and third anniversariesanniversary of the December 6, 2017 grant date. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

 

 (4)

14,423One-half of these restricted share units were granted on February 18, 2015, of which 14,423options will vest on each of the second and third anniversary of the grant date.date anniversary of the February 13, 2019. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

 

 (5)

One-third4,092 of these optionsrestricted share units were granted on February 14, 2018, of which will vest on the third anniversary of the grant date. 13,900 of these restricted share units were granted on February 13, 2019, of which one-half will vest on each of the second and third anniversary of the grant date. 46,793 of these restricted share units were granted on February 19, 2020, of which one-third will vest on each of the first, second and third anniversariesanniversary of the February 18, 2015 grant date. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

 

 (6)

One-third of theseThese options will vest on eachthe third anniversary of the first, second and third anniversariesgrant date anniversary of the February 17, 2016 grant date.14, 2018. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

 

 (7)

For the 2016 performance option grants to be exercisable, the share price had to achieve at least $9.50 for fifteen trading days during the three-year service vesting period, which was achieved during 2016. Under the service vesting requirement,one-third of these options vest on each of the first, second and third anniversaries of the February 17, 2016 grant date. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

(8)

One-third of these options vest on each of the first, second and third anniversaries of the February 15, 2017 grant date. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

(9)

For the 2017 performance option grants to be exercisable, the share price had to achieve at least $14.78 for fifteen trading days during the three-year service vesting period. Under the service vesting requirement,one-third of these options vest on each of the first, second and third anniversaries of the February 15, 2017 grant date. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

(10)

3,0372,414 of these restricted share units were granted on February 18, 2015 and14, 2018, of which will vest on the third anniversary of the grant date. 2,9868,510 of these restricted share units were granted on October 1, 2015February 13, 2019, of which one-half will vest on each of the second and third anniversary of the grant date. 29,801 of these restricted share units were granted on February 19, 2020, of which one-third will vest on each of the first, second and third anniversary of the grant date.

(8)

2,414 of these restricted share units were granted on February 14, 2018, of which will vest on the third anniversary of the grant date. 8,4068,510 of these restricted share units were granted on February 15, 2017,13, 2019, of which 2,802one-half will vest on each of the second and third anniversary of the grant date. 28,649 of these restricted share units were granted on February 19, 2020, of which one-third will vest on each of the first, second and third anniversary of the grant date. Vesting is accelerated upon death, disability or a qualifying termination following a change in control.

 

 (11)(9)

One-third of these options vest on each of the first, second and third anniversaries of the October 1, 2015 grant date. Vesting is continued upon retirement after the year of grant and accelerated upon death, disability or a qualifying termination following a change in control of SunCoke Energy.

(12)

1,8502,003 of these restricted share units were granted on February 18, 2015 and14, 2018, of which will vest on the third anniversary of the grant date. 9,9566,775 of these restricted share units were granted on October 1, 2015 andFebruary 13, 2019, of which one-half will vest on each of the second and third anniversary of the grant date. 4,62922,809 of these restricted share units were granted on February 15, 2017,19, 2020, of which 1,543one-third will vest on each onof the first, second and third anniversary of the grant date. Vesting is accelerated upon death, disability or a qualifying termination following a change in control.

(13)

1,463 of these restricted share units were granted on February 18, 2015 and will vest on the third anniversary of the grant date. 5,786 of these restricted share units were granted on February 15, 2017, of which 1,929 will vest each on the first, second and third anniversary of the grant date. Vesting is accelerated upon death, disability or a qualifying termination following a change in control.

(14)

3,468 of these restricted share units were granted on February 18, 2015 and will vest on the third anniversary of the grant date. 3,807 of these restricted share units were granted on February 15, 2017, of which 1,269 will vest each on the first, second and third anniversary of the grant date. Vesting is accelerated upon death, disability or a qualifying termination following a change in control.

20172020 Option Exercises and Stock Vested Table

The following table sets forth the exercises of options and vested awards for the fiscal year ended December 31, 2017:2020:

 

 Option Awards     Stock Awards  Option Awards    Stock Awards

Named Executive Officer

 No. of Shares
Acquired on
Exercise

(#)
   Value
Realized on
Exercise
($)(1)
     No. of Shares
Acquired on
Vesting

(#)
   Value
Realized on
Vesting
($)(2)
  No. of Shares
Acquired on
Exercise
(#)
  Value
Realized on
Exercise
($)
    No. of Shares
Acquired on
Vesting
(#)
  Value
Realized on
Vesting
($) (1)

Michael G. Rippey

  0    0      0    0             42,510    866,554

Frederick A. Henderson

  0    0      29,546    289,883 

Fay West

  0    0      8,187    78,413             12,158    258,172

Katherine T. Gates

            23,942    154,939

Phillip M. Hardesty

  8,888    67,460      13,220    123,053             23,557    152,621

Katherine T. Gates

  0    0      2,324    22,838 

Gary P. Yeaw

  0    0      5,922    58,081 

John F. Quanci

            6,771    41,304    

 

 (1)

The amount in this column represents the difference between the closing price of our common stock on the date of exercise and the exercise price, multiplied by the number of shares covered by the options.

(2)

The amounts in this column represent the value realized by multiplying the closing price of our common stock on the date of vesting by the number of shares vested. Included for Mr. Henderson,Mrs. Rippey, Ms. West, Ms. Gates and Mr. Hardesty and Ms. West are the vested PSUs from the 20152018 PSU award, which vested at 1.35%70.6%, as approved by the Compensation Committee on February 14, 2018.25, 2021.

 

2017 Nonqualified Deferred Compensation Table

The following table sets forth information regarding the contributions, earnings and account balances under our Savings Restoration Plan or SRP, for 2017:

Named Executive Officer  

Executive

Contributions

in 2017

($)

   

Registrant

Contributions

in 2017

($) (1)

   

Aggregate

Earnings

In 2017

($) (2)

   

Aggregate

Withdrawals/

Distributions

In 2017

($)

   

Aggregate

Balance

as of

December 31, 2017

($)(3)

 

    Michael G. Rippey(4)

   0    0    0    0    0 

    Frederick A. Henderson

   75,619    163,292    313,597    0    1,713,559 

    Fay West

   19,462    65,807    45,680    0    370,761 

    Phillip M. Hardesty

   16,077    45,996    32,899    0    258,185 

    Katherine T. Gates

   16,077    35,268    21,048    0    126,210 

    Gary P. Yeaw

   74,462    34,185    35,135    0    346,428 

(1)

These amounts represent contributions made under our SRP, which include matching contributions equal to 100% of the first 5% and an annual contribution equal to 3% of compensation deferred by the participant under the SRP. These amounts are reported in the Summary Compensation Table under “All Other Compensation”.

(2)

The earnings in this column are not included in the Summary Compensation Table.

(3)

The aggregate balances reported in this column for each NEO include amounts reported previously in prior years’ Summary Compensation Tables: Mr. Henderson: $1,161,050; Ms. West: $239,812; Mr. Hardesty: $163,214; Ms. Gates: $53,817 and Mr. Yeaw: $202,647.

(4)

Mr. Rippey did not have any eligible earnings under the SRP in 2017.

Savings Restoration Plan

On December 6, 2011, the Compensation Committee adopted the SRP, effective as of January 1, 2012, The SRP is an unfunded, nonqualified deferred compensation plan that is made available to participants in our 401(k) Plan whose compensation is expected to exceed the IRS limit on compensation that can be considered under that Plan ($270,000285,000 for 2017)2020). Under the SRP, employees

can make an advance election to defer on apre-tax basis up to 50% of the portion of their salary and bonus that exceeds the applicable IRS compensation limit. Such amounts will be credited to a bookkeeping account established for each participant as of the date the amounts would otherwise have been paid to the participant. Employer contributions will be credited to the accounts of each employee who elects to defer compensation, and they consist of (1) a matching contribution equal to 100% of the first 5% of compensation deferred by the participant under the SRP and (2) an additional contribution equal to 3% of the compensation deferred by the participant under the SRP. The SRP was amended to provide that, effective January 1, 2016, employer contributions to the SRP were suspended. Employer contributions were reinstated beginning January 1, 2017.

Participants are always fully vested in their own deferrals as well as the 3% employer contribution, and they will vest in the employer matching contributions and discretionary contributions

in accordance with the vesting schedule in the 401(k) Plan, which provides for 100% vesting after three years of service. Participants can direct the investment of their bookkeeping accounts among the same investment alternatives available under the 401(k) Plan. Unless the participant elects otherwise, distributions are made in a lump sum on the first day of the seventh month following termination of employment (or immediately to the participant’s beneficiary in the event of the participant’s earlier death). The participant can elect, prior to his or her first year of participation, to receive a distribution in installments over two to ten years instead of a lump sum if he or she terminates due to retirement, which is defined as termination after attaining age 55 with 10 years of service, or age 60 with 5 years of service. In addition, a participant can elect, concurrently with the annual deferral election, to receive anin-service lump sum distribution of the amount he or she elects to defer for such year, with such payment date not earlier than three years from the end of the year in which the election is made. A participant can change the time or method of distribution in limited circumstances. Upon a change in control, the SRP will automatically terminate, and all account balances will be distributed to participants.

2020 Nonqualified Deferred Compensation Table

The following table sets forth information regarding the contributions, earnings and account balances under our Savings Restoration Plan, or SRP, for 2020:

Named Executive Officer  

Executive

Contributions

in 2020

($) (1)

  

Registrant

Contributions

in 2020

($) (2)

  

Aggregate

Earnings
(Losses)

In 2020

($) (3)

  

Aggregate

Withdrawals/

Distributions

In 2020

($)

  

Aggregate

Balance

as of

  December 31, 2020  

($) (4)

    Michael G. Rippey

    86,292    138,067    158,347        661,989

    Fay West

    33,769    54,030    108,717        800,452

    Katherine T. Gates

    26,151    41,842    56,195        378,880

    Phillip M. Hardesty

    27,408    43,853    56,963        526,796

    John F. Quanci

    24,148    38,636    60,188        435,290

(1)

These amounts represent elective executive deferrals of salary or non-equity incentive compensation under our SRP from the amounts included in the Summary Compensation Table under “Salary” or “Non-Equity Incentive Plan Compensation”, respectively.

(2)

These amounts represent contributions made under our SRP, which include matching contributions equal to 100% of the first 5% and an annual contribution equal to 3% of compensation deferred by the participant under the SRP. These amounts are reported in the Summary Compensation Table under “All Other Compensation”.

(3)

The earnings/ (losses) in this column are not included in the Summary Compensation Table.

(4)

The aggregate balances reported in this column for each NEO include amounts reported in Summary Compensation Tables for 2020 and prior years: Mr. Rippey: $383,179; Ms. West: $487,840; Ms. Gates: $228,720; Mr. Hardesty: $281,037; and Mr. Quanci: $68,892.

Potential Payments upon Termination or Change in Control

We provide benefits to our NEOs upon termination of employment under certain circumstances. These benefits are in addition to the benefits to which the NEOs would be entitled upon a termination of employment generally (which include vested retirement benefits accrued as of the date of termination, stock-based awards that are vested as of the date of termination, accrued and unused vacation and the right to elect continued health coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act, or COBRA). The incremental benefits payable to the NEOs are described as follows:

Executive Involuntary Severance Plan

The Executive Involuntary Severance Plan provides severance to designated executives whose employment is terminated by SunCoke Energy other than for cause (as defined in the Plan), death or disability. Severance is paid in monthly installments and ranges from one (for each VP) to one and a half times (for each SVP) the sum of the executive’s annual base salary and target annual incentive, depending on the executive’s position. In addition, if termination occurs after the first quarter of the calendar year, executives are eligible for the cash annual incentive, prorated based on full months worked and paid out based on Company performance. Executives are also entitled to the continuation of medical plan benefits (excluding dental)dental and vision) at active employee rates for the salary continuation period of one to one andone-half a half years (which runs concurrently with COBRA); continuation of life insurance coverage equal to

one time’s the executive’s base salary; and outplacement services. Severance is subject to the execution of a release of claims against SunCoke Energy at the time of termination of the executive’s employment. The multiple of base salary and annual incentive for each NEO is 1.5x.

Special Executive Severance Plan

The Special Executive Severance Plan provides severance to designated executives whose employment is terminated by SunCoke Energy other than for cause, death or disability, or who resign for good reason (as such terms are defined in the Plan) within two years following a change in control of SunCoke Energy. Severance is generally payable in a lump sum, having a value equal to two times the sum of the executive’s annual base salary and the greater of (i) 100% of the executive’s target annual incentive in effect immediately before the change in control or, if higher, employment termination date, or (ii) the average annual incentive awarded to the executive with respect to the three years ending before the change in control or, if higher, ending before the employment termination date. In addition, if termination occurs after the first quarter of the calendar year, executives are eligible for the cash annual incentive, prorated based on full months worked and paid out based on Company performance. Executives are also entitled to the continuation of medical, dental and dentalvision plan benefits at active employee rates for two years (with COBRA eligibility beginning at the end of the applicable continuation period), continuation of life insurance coverage equal to one time’s the executive’s base salary and outplacement services. In addition, if an executive is terminated without cause within two years of the change in control all equity awards will vest and stock options continue to be exercisable for one year following such termination, which is consistent with the LTPEP. If the benefits received by an executive upon a change in control would trigger an excise tax under Section 280G of the Internal Revenue Code, the benefits under the plan will either (i) be paid to the executive, in which case he or she will be responsible for the tax or, (ii) if it would result in a greaterafter-tax benefit to the executive, be reduced so that no excise tax is triggered.

Long-Term Performance Enhancement Plan

Under the LTPEP, if within 24 months following a change in control a participant’s employment is terminated by SunCoke Energy other than for cause, death or disability or by the participant for good reason (as such terms are defined in the LTPEP), all equity awards will vest under the terms of the award agreements, and stock options continue to be exercisable for one year following such termination. In addition, stock options continue to vest if retirement occurs on or after December 31 of the calendar year in which the stock option was granted, and fully vest upon death or disability. In the

case of retirement, death or disability, vested options remain exercisable for the remaining term of the grant. For all other terminations, unvested options are forfeited, and the employee has three years from the date of termination to exercise any vested options. RSUs fully vest upon death or disability. In the case of retirement, beginning with grants made in 2015, RSU grants made in the year of retirement continue to vest based on a quarterly proration schedule from the date of grant (Q1: 0%, Q2: 25%, Q3: 50%, Q4: 75%). If retirement occurs in the year following the RSU grant, all unvested sharesRSUs continue to vest. PSUs vest at target upon death or disability and, in the case of retirement, are prorated monthly based on time worked and are paid out based on Company performance. In the case of termination for just cause, all unvested equity will be forfeited and vested but unexercised stock options will be cancelled. For any awards granted prior to 2015,under the LTPEP, retirement meansmeans: (i) attainment of at least age 55, and (ii) actual age plus 10 years of service or age 60 plus 5 years of service. For awards granted in 2015 and forward, retirement means age 55 plus age and years of service to equalequals at least 65.

Potential Payments upon Termination or Change in Control Table

The table set forth below quantifies the additional benefits payments that would be paid to each current NEO pursuant to the arrangements described above, assuming a termination of employment and/or change in control occurred on December 31, 2017:2020:

 

Named Executive Officer 

Death/Disability

($)

  

Termination
Prior to a
Change in
Control

($)

  

Termination in
Connection

With a Change

in Control

($)

 

Michael G. Rippey:

            

•   Cash Severance(1)

  --   $2,250,000   $3,000,000 

•   Annual Incentive(2)

  --   --   -- 

•   Health & Welfare Continuation(3)

  --   $11,282   $15,560 

•   Stock Option Acceleration Value(4)

  $86,708   --   $86,708 

•   Restricted Share Unit Acceleration Value (4)

  --   --   -- 

•   Performance Share Unit Acceleration Value(4)

  $1,776,295   --   $1,776,295 

•   Outplacement(5)

  --   $8,900   $8,900 

TOTAL

  $1,863,003   $2,270,182   $4,887,463 

Frederick A. Henderson:

            

•   Cash Severance(1)

  --   $2,868,750   $3,825,000 

•   Annual Incentive(2)

  $1,074,188   $1,074,188   $1,074,188 

•   Health & Welfare Continuation(3)

  --   $29,417   $40,773 

•   Stock Option Acceleration Value(4)

  $948,128   $948,128(6)   $948,128 

•   Restricted Share Unit Acceleration Value (4)

  $172,932   $172,932(6)   $172,932 

•   Performance Share Unit Acceleration Value(4)

  $4,159,739   $2,516,312(6)   $5,842,630 

•   Outplacement(5)

  --   $8,900   $8,900 

TOTAL

  $6,354,987   $7,618,627   $11,912,551 

Fay West:

            

•   Cash Severance(1)

  --   $1,518,000   $2,024,000 

•   Annual Incentive(2)

  $558,072   $558,072   $558,072 

•   Health & Welfare Continuation(3)

  --   $911   $1,214 

•   Stock Option Acceleration Value(4)

  $348,895   --   $348,895 

•   Restricted Share Unit Acceleration Value (4)

  $173,004   --   $173,004 

•   Performance Share Unit Acceleration Value(4)

  $1,415,527   --   $1,964,421 

•   Outplacement(5)

  --   $8,900   $8,900 

TOTAL

  $2,495,498   $2,085,883   $5,078,506 

Phillip M. Hardesty:

            

•   Cash Severance(1)

  --   $1,168,500   $1,558,000 

•   Annual Incentive(2)

  $403,389   $403,389   $403,389 

•   Health & Welfare Continuation(3)

  --   $28,684   $39,796 

•   Stock Option Acceleration Value(4)

  $165,769   --   $165,769 

•   Restricted Share Unit Acceleration Value (4)

  $197,056   --   $197,056 

•   Performance Share Unit Acceleration Value(4)

  $785,945   --   $1,088,236 

•   Outplacement(5)

  --   $8,900   $8,900 

TOTAL

  $1,552,159   $1,609,473   $3,461,146 
    
Named Executive Officer 

Death/Disability

($)

  

Termination
Prior to a
Change in
Control

($)

  

Termination in
Connection

With a Change

in Control

($)

 

Michael G. Rippey:

            

•   Cash Severance (1)

  --   2,775,000   3,700,000 

•   Annual Incentive (2)

  925,000   925,000   925,000 

•   Health & Welfare Continuation (3)

  --   10,716   14,598 

•   Stock Option Acceleration Value (4)

  --   --   -- 

•   Restricted Share Unit Acceleration Value (4)

  1,102,373   --   1,102,373 

•   Performance Share Unit Acceleration Value (4)

  1,884,825   --   1,884,825 

•   Long-Term Performance Cash Plan (5)

  901,875   --   901,875 

•   Outplacement (6)

  --   8,900   8,900 

TOTAL

  4,814,072   3,719,616   8,537,570 

Fay West:

            

•   Cash Severance (1)

  --   1,286,985   1,715,980 

•   Annual Incentive (2)

  353,290   353,290   353,290 

•   Health & Welfare Continuation (3)

  --   999   1,332 

•   Stock Option Acceleration Value (4)

  --   --   -- 

•   Restricted Share Unit Acceleration Value (4)

  281,815   --   281,815 

•   Performance Share Unit Acceleration Value (4)

  464,062   --   464,062 

•   Long-Term Performance Cash Plan (5)

  211,974   --   211,974 

•   Outplacement (6)

  --   8,900   8,900 

TOTAL

  1,311,141   1,650,174   3,037,354 

Named Executive Officer 

Death/Disability

($)

  

Termination
Prior to a
Change in
Control

($)

  

Termination in
Connection

With a Change

in Control

($)

 

Katherine T. Gates

            

•   Cash Severance(1)

  --   $1,054,500   $1,406,000 

•   Annual Incentive(2)

  $326,553   $326,553   $326,553 

•   Health & Welfare Continuation(3)

  --   $10,241   $14,169 

•   Stock Option Acceleration Value(4)

  $133,784   --   $133,784 

•   Restricted Share Unit Acceleration Value (4)

  $86,916   --   $86,916 

•   Performance Share Unit Acceleration Value(4)

  $608,960   --   $841,680 

•   Outplacement(5)

  --   $8,900   $8,900 

TOTAL

  $1,156,213   $1,400,194   $2,818,002 

Gary P. Yeaw

            

•   Cash Severance(1)

  --   $984,375   $1,312,500 

•   Annual Incentive(2)

  $284,344   $284,344   $284,344 

•   Health & Welfare Continuation(3)

  --   $18,038   $25,012 

•   Stock Option Acceleration Value(4)

  $136,329   $136,329(6)   $136,329 

•   Restricted Share Unit Acceleration Value(4)

  $87,227   $87,227(6)   $87,227 

•   Performance Share Unit Acceleration Value(4)

  $591,599   $403,195(6)   $840,189 

•   Outplacement(5)

  --   $8,900   $8,900 

TOTAL

  $1,099,499   $1,922,408   $2,694,501 
    
Named Executive Officer 

Death/Disability

($)

  

Termination
Prior to a
Change in
Control

($)

  

Termination in
Connection

With a Change

in Control

($)

 

Katherine T. Gates

            

•   Cash Severance (1)

  --   1,147,500   1,530,000 

•   Annual Incentive (2)

  315,000   315,000   315,000 

•   Health & Welfare Continuation (3)

  --   9,775   13,341 

•   Stock Option Acceleration Value (4)

  --   --   -- 

•   Restricted Share Unit Acceleration Value (4)

  177,154   --   177,154 

•   Performance Share Unit Acceleration Value (4)

  284,316   --   284,316 

•   Long-Term Performance Cash Plan (5)

  135,000   --   135,000 

•   Outplacement (6)

  --   8,900   8,900 

TOTAL

  911,470   1,481,175   2,463,710 

Phillip M. Hardesty:

            

•   Cash Severance (1)

  --   1,103,130   1,470,840 

•   Annual Incentive (2)

  302,820   302,820   302,820 

•   Health & Welfare Continuation (3)

  --   26,711   36,645 

•   Stock Option Acceleration Value (4)

  --   --   -- 

•   Restricted Share Unit Acceleration Value (4)

  172,143   172,143(7)   172,143 

•   Performance Share Unit Acceleration Value (4)

  280,558   130,005(7)   280,558 

•   Long-Term Performance Cash Plan (5)

  129,780   32,532(7)   129,780 

•   Outplacement (6)

  --   8,900   8,900 

TOTAL

  885,300   1,776,240   2,401,685 

John F. Quanci:

            

•   Cash Severance (1)

  --   631,441   1,262,882 

•   Annual Incentive (2)

  248,750   248,750   248,750 

•   Health & Welfare Continuation (3)

  --   29,519   40,389 

•   Stock Option Acceleration Value (4)

  --   --   -- 

•   Restricted Share Unit Acceleration Value (4)

  137,403   137,403(7)   137,403 

•   Performance Share Unit Acceleration Value (4)

  --   --   -- 

•   Long-Term Performance Cash Plan (5)

  307,085   153,225(7)   307,085 

•   Outplacement (6)

  --   8,900   8,900 

TOTAL

  693,238   1,209,238   2,005,409 

 

 (1)

These amounts represent the salary continuation made in accordance with the Executive Involuntary Severance Plan for termination prior to a change in control and the Special Executive Severance Plan on or after a change in control.

 

 (2)

These amounts represent the current year annual incentive made in accordance with the Executive Involuntary Severance Plan for termination prior to a change in control, the Special Executive Severance Plan on or after a change in control and the SunCoke Annual Incentive PlanAIP for termination for death or disability.

 

 (3)

These amounts reflect the continuation of medical benefits and life insurance coverage under the Executive Involuntary Severance Plan and the continuation of medical, andvision, dental benefits and life insurance coverage under the Special Executive Severance Plan.

 

 (4)

The market value of stock options, RSUs and PSUs that would vest under the Long-Term Performance Enhancement Plan is calculated based on the closing price of our common stock on December 31, 2017 of $11.992020, which was $4.35, and PSU performance as of December 31, 2017.2020.

 

 (5)

These amounts represent the value of long-term performance cash awards that would vest under the LTIP and is based on performance as of December 31, 2020.

(6)

These amounts represent the outplacement benefit our executives are eligible to receive under each termination Plan.

 

 (6)(7)

Any NEO who is retirement eligible as of 12/31/20172020 is entitled to continued vesting of stock options, continued vesting of all or a portion of RSUs and a pro rata portion of PSUs and long-term performance cash as defined under retirement provisions of the LTPEP and LTIP award agreements.

 

PROPOSAL 2 -- APPROVAL OF AMENDMENT AND RESTATEMENT OF THE SUNCOKE ENERGY, INC. LONG-TERM PERFORMANCE ENHANCEMENT PLAN

General

We currently provide equity-based awards pursuant to the SunCoke Energy, Inc. Long-Term Performance Enhancement Plan, which was adopted by the Compensation Committee of our Board of Directors (the “Compensation Committee”) and subsequently approved by stockholders in May 2013 (the “2013 Plan”). At the 2018 Annual Meeting, the Company’s stockholders will be asked to approve amendments to the 2013 Plan (as amended, the “Plan”) that, among other things, increase the number of shares of the Company’s common stock available for award grants by 1,500,000 shares.

Reasons for Amendment of the 2013 Plan

The 2013 Plan is intended to promote the interests of the Company and its stockholders by offering competitive long-term incentives to those employees responsible for the Company’s long-term profitable growth (“Key Employees”). The Board of Directors believes the interests of the Company and its stockholders will be advanced if the Company can continue to offer eligible employees the opportunity to acquire or increase their proprietary interest in the Company through equity awards made under the Plan. Currently, the maximum number of shares of the Company’s common stock that may be issued or transferred pursuant to awards granted under the 2013 Plan consists of: (i) 6,000,000 shares covered by Registration Statement No. 333-176403 on Form S-8, filed August 19, 2011, in connection with our initial public offering on July 21, 2011 by Sunoco, Inc. (“Sunoco”); and (ii) an additional 1,600,000 shares covered by Registration Statement No. 333-179804 on Form S-8, filed February 29, 2012, resulting from the adjustment of Sunoco equity awards in connection with Sunoco’spro-rata distribution on January 17, 2012 of 0.53046456 of a share of our common stock for each share of Sunoco common stock held on the record date for such distribution.

The Company’s ability to attract, retain and motivate high-caliber qualified personnel is vital to our efforts to implement changes in our business development strategies that we believe are necessary to create consistent and sustainable growth and profitability. The Compensation Committee believes that it is in the Company’s best interests to increase the maximum number of shares of Common Stock available for grant under the Plan. The Company’s use of equity compensation allows it to offer market competitive compensation packages that more effectively align employee incentives with the success of our business development efforts and stockholder interests.

As of March 7, 2018, only 1,317,829 shares of our common stock remained available for future award grants. Without an increase in the number of shares of common stock available for grant under the Plan, our ability to offer competitive compensation packages to existing employees and to attract additional talented key employees will be compromised. Accordingly, on February 14, 2018, the Compensation Committee voted to approve an amendment and restatement of the 2013 Plan, subject to stockholder approval, to increase the number of shares of common stock available for issuance under the Plan by 1,500,000 shares, and to make certain other changes. No awards may be granted following the fifth anniversary of the date the Compensation Committee voted to approve the amendment and restatement, or such earlier date as otherwise may be determined by the Compensation Committee.

With the additional 1,500,000 shares requested, the Company should have sufficient shares for our equity compensation needs through the expiration of the Plan. Actual usage of shares may be different from the estimate as several factors may change each year. For example:

The largest equity compensation component is granted in performance share units (“PSUs”) that may be earned above or below target. As of March 7, 2018, 752,375 of

outstanding awards were performance-based. In the event our performance exceeds target, the number of actual shares awarded under the Plan will increase, and the actual number of shares deducted from the Plan will be higher than the number of PSUs currently outstanding.

The number of participants in the Plan may vary each year.

The actual stock price on applicable grant dates will vary.

In approving the increase in the number of shares of common stock available for issuance under the Plan, the Compensation Committee considered our long-term incentive pay strategy of emphasizing equity grants to executives to align their interests to those of our stockholders, and also reviewed an analysis of equity grant practices for our industry peer group provided by our independent compensation consultant.

Historical Equity Usage and Current Potential Dilution

Our annual equity usage has been declining in the last three years, with an approximate annual share usage (or “burn rate”) of 1.3% of shares outstanding:

   2017  2016  2015  Average

Stock options granted

  237,791  335,299  593,976  389,022

Full-value awards (RSUs & PSUs) granted

  408,386  479,086  447,668  445,047

Total equity grants

  646,177  814,385  1,041,644  834,069

Weighted average basic shares outstanding

  64,300,000  64,200,000  65,000,000  64,500,000

Burn rate

  1.0%  1.3%  1.6%  1.3%

This amendment will increase the Company’s potential dilution by 2.3%. As of the record date, the total potential dilution with the additional shares requested would approximate 10.7% in total. The following table provides updated equity compensation plan information as of the record date:

As of March 7, 2018

  Full value awards (RSUs & PSUs) outstanding

824,909

  Stock options outstanding1

3,229,602

  Total outstanding awards

4,054,511

  Shares available for future grants under the current plan

1,317,829

  Additional shares requested under the amended plan

1,500,000

  Total shares outstanding

64,300,000

  Potential dilution

10.7%

  Additional shares subject to potential above-target payout of PSUs

752,375

NOTES TO TABLE

1.

As of March 7, 2018, the weighted average exercise price for outstanding stock options is $15.19, and the weighted average remaining contractual term for outstanding options is 5.5 years.

Key Plan Features

• The Plan places specific limits on the number of shares that can be issued for awards granted under the Plan and to any single participant in any one calendar year.

• Awards under the Plan are generally subject to a minimumone-year vesting period (95% of awards).

• The Plan does not have liberal share counting.

• The Plan prohibits the granting of discounted stock options and SARs.

• The Plan prohibits repricing of stock options or SARs without stockholder approval.

• The Plan does not provide for any taxgross-ups for excise taxes payable in connection with a change in control.

• Award agreements under the Plan will require that awards are subject to: (i) forfeiture and clawback provisions; and (ii) “double-trigger” vesting upon a change in control.

• The Plan has no “evergreen” features.

• For stock and share unit awards, dividends and dividend equivalents are paid only to the extent that awards actually vest.

• The Plan will be administered by the Company’s independent Compensation Committee.

Summary of Plan Provisions

The following summary is qualified in its entirety by reference to the full text of the Plan, attached hereto as Exhibit A.

Eligibility

The following persons are eligible to participate in the Plan: (i) any employee of the Company (or a subsidiary) designated as a participant by the Compensation Committee of the Company’s Board of Directors (the “Committee”); and (ii) any person receiving an award under the Plan in connection with such person’s hiring;provided, however, that such award does not vest prior to commencement of employment.

Administration

The Plan is administered by the Committee, which has the authority to: (i) designate participants; (ii) grant awards under the Plan; (iii) determine the applicable terms and conditions of awards; (iv) interpret the Plan; and (v) adopt, amend and rescind rules and regulations relating to the Plan. The decisions and of the Committee on all matters relating to the Plan shall be in its sole discretion and shall be conclusive.

Shares Subject to the Plan

The maximum number of shares of the Company’s common stock issuable under the Plan is 9,100,000, which includes the additional 1,500,000 shares that we are asking stockholders to approve. During any calendar year, no single participant may be granted options covering more than 1,000,000 shares, or share units or restricted stock covering more than an aggregate of

750,000 shares (or, if settled in cash, an amount equal to the fair market value of such number of shares on the settlement date). The maximum number of shares that can be issued under the Plan is fixed and cannot be increased without stockholder approval.

Types of Awards:

Awards under the Plan may be in the form of any one or more of the following:

Ø

Stock Options

The Committee may grantnon-qualified stock options or incentive stock options (entitled to potentially favorable tax treatment) under the Plan. The term and the vesting schedule of each stock option will be determined by the Committee. No stock option may be exercised after the expiration of its term, and the maximum term of any stock option will be ten years. Stock options may be granted with time-based vesting, or vesting upon satisfaction of performance goals and/or other conditions. The stock option exercise price, determined at the time of grant, will be at least 100% of the fair market value of a share on the date of grant. For incentive stock options granted to key employees who own more than 10% of the total outstanding shares of the Company or any subsidiaries, the stock option exercise price will be 110% of the fair market value of a share on the date of grant. Consistent with applicable laws, regulations and rules, payment of the exercise price may be made in cash, by cashless exercise, or by delivery or withholding of shares having an aggregate fair market value equal to the exercise price. Participants do not have any right to receive payment of cash dividends, or crediting of dividend equivalents, on shares of Company common stock subject to unexercised stock options. No dividends or dividend equivalents will be paid with respect to any shares subject to stock options prior to exercise of the options. Dividends may be paid only upon shares of actual stock received as a result of the exercise of such options.

Ø

Restricted Stock

The Committee may award shares of stock with time-based vesting conditioned upon continued employment with the Company, or with vesting conditioned upon satisfaction of specified performance goals and other conditions. Once the applicable restricted stock grant award conditions have been satisfied, the participant will be vested in the shares and will have all of the rights of a stockholder of the Company, including the right to vote the shares and the right to receive any cash dividends. Vesting of the right to receive dividends is conditioned upon actual vesting of the restricted stock.

Ø

Share Units

Under the Plan, the Committee may award share units with time-based vesting conditioned upon continued employment with the Company (“RSUs”), or with vesting conditioned upon satisfaction of specified performance goals and other conditions (“PSUs”). Participants are not required to pay any consideration to the Company at the time of grant. Upon vesting, share units may be settled either in shares of the Company’s common stock, or in cash, at the sole discretion of the Committee. The medium of payment will be set forth in participant’s award agreement at the time of grant. Vesting of dividend equivalent rights is conditioned upon actual vesting of the share unit award.

Ø

Stock Appreciation Rights, or SARs

The Committee may grant stock appreciation rights under the Plan. The vesting schedule and number of shares covered by each SAR will be determined by the Committee. SARs may be grated with time-based vesting, or with vesting conditioned upon satisfaction of specified performance goals and other conditions. The exercise price of an SAR will be established by

the Committee and may not be less than 100% of the fair market value of a share on the date of grant. The term and vesting schedule of each SAR shall be determined by the Committee. No SAR shall be exercisable after the expiration of its term and the maximum term of any SAR shall be ten years. SARs may be paid in cash or in shares of the Company’s common stock, or any combination thereof, as determined by the Committee, in its sole discretion, at the time of grant. Upon exercise of an SAR, the participant will be entitled to receive a number of shares of the Company’s common stock (or an applicable amount of cash) having an aggregate fair market value equal to the excess of the fair market value of one share (as of the date on which the SAR is exercised) over the exercise price, multiplied by the number of shares with respect to which the SAR is being exercised. No dividends or dividend equivalents will be paid with respect to any SARs. Participants do not have the right to receive payment of cash dividends, or crediting of any dividend equivalents, on SARs until settlement of such SARs in the form of actual shares of Company common stock has occurred. Dividends may be paid only upon shares of actual stock received as a result of such settlement. SARs settled in cash do not receive dividends and are not credited with dividend equivalents.

Other

Ø

Minimum Vesting

The Plan imposes aone-year minimum vesting period for awards. Options and SARs will not become exercisable until at least one year following the date of grant, and the restrictions on restricted stock and share units will not lapse for at least one year following the date of grant. However, no minimum vesting schedule will apply to awards resulting in the issuance of up to an aggregate of five percent of all shares of common stock to be reserved for issuance under the Plan, as amended.

Ø

No Repricing

In no case would any adjustment be made to a stock option or SAR award under the Plan, whether by amendment, cancellation andre-grant, exchange, or other means, that would constitute a repricing of theper-share exercise or base price of the award, unless suchre-pricing is approved by the Company’s stockholders.

Ø

Transferability

Awards under the Plan are not generally assignable or transferable by the recipient other than by will or by the laws of descent and distribution, or to the extent not inconsistent with applicable provisions of the Internal Revenue Code, pursuant to a qualified domestic relations order under applicable provisions of law. Awards generally are exercisable, during the recipient’s lifetime, only by the recipient. Any amounts payable, or shares issuable, pursuant to an award generally will be paid only to the recipient or the recipient’s beneficiary or representative. In no event will any Plan participant be permitted to transfer stock options to a third-party financial institution without approval of the Company’s stockholders.

Ø

No “Liberal” Share Counting

Shares of common stock withheld or surrendered to pay the option exercise price for a stock option or to satisfy tax withholding requirements upon exercise of stock options or vesting of restricted stock units will not be added back to the aggregate number of shares of common stock that may be made subject to awards under the Plan, and will not be available for future grant or issuance under the Plan. To the extent that an award is settled in cash, the shares that would have been delivered had there been no such cash settlement will not be counted against the shares available for issuance under the Plan. Shares subject to awards that expire, or for any reason are cancelled, terminated, forfeited, fail to vest, or are otherwise unpaid or

undelivered under the Plan, will again be available for issuance pursuant to subsequent awards under the Plan. The Company may not increase the applicable share limits of the Plan by repurchasing shares of common stock on the market using cash received through the exercise of stock options, or otherwise.

Forfeiture Provisions

The shares of common stock or cash payments received in connection with any award granted under the Plan constitute incentive compensation, and such common stock and/or cash payments received with respect to such award will be subject to the Company’s recoupment policy.

Change in Control Provisions/Equitable Adjustments

The Plan gives the Committee the discretion to include in an award agreement provisions relating to a change in control of the Company. The current award agreements provide that upon a participant’s termination of employment by the Company other than for cause, death, disability, or by the participant for good reason (as defined in the relevant documents) within 24 months following a change in control of the Company, unvested options vest and remain exercisable for one year (or the expiration of the term, if earlier) and stock awards and stock unit awards (and related dividends and dividend equivalents) vest. In the event of a change in the company’s capitalization that constitutes an equity restructuring, such as a stock split, the Committee will make adjustments to the number of authorized shares and the individual limits set forth above, and the Committee may, but need not, make adjustments in the case of other changes. In the event of certain fundamental changes, such as a merger or sale of all or substantially all of the company’s assets, the Committee may provide for assumption or replacement of outstanding awards by the successor entity, or cancellation of such outstanding awards in exchange for cash, property, or a combination thereof, having an aggregate value equal to the value of such awards, as determined by the Committee in its sole discretion.

Amendment and Termination

The Committee may amend, alter, or discontinue the Plan at any time, provided that any such amendment will be subject to stockholder approval to the extent required by applicable laws, regulations or rules. No amendment, alteration or discontinuation may be made that materially impairs the rights of a participant with respect to a previously granted award without such Participant’s consent, except an amendment alteration or discontinuation made to comply with applicable laws, regulations or rules.

Compliance with I.R.C. §409A

It is the Company’s intention that no award under the Plan be “deferred compensation” subject to Section 409A of the Internal Revenue Code (the “Code”), and the terms and conditions of all such awards will be interpreted accordingly, unless and only to the extent that the Committee specifically determines otherwise. The terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code, including any rules for elective or mandatory deferral of the delivery of cash or shares pursuant thereto and any rules regarding treatment of such awards in the event of a change in control, shall be set forth in the applicable Award Agreement, and shall comply in all respects with Section 409A of the Code. Notwithstanding any other provision of the Plan to the contrary, with respect to any Award that constitutes a “nonqualified deferred compensation plan” subject to Section 409A of the Code, any payments (whether in cash, shares or other property) to be made with respect to the Award upon the participant’s termination of employment shall be delayed until the first day of the seventh month following the Participant’s termination of employment if the participant is a “specified employee” within the meaning of Section 409A of the Code.

Summary of Federal Income Tax Implications of Participation in the Plan

The following is a summary of the federal income tax consequences of the Plan. It is based on the federal tax laws and regulations currently in effect and existing administrative rulings of the Internal Revenue Service. Participants may also be subject to state and local taxes in connection with the grant of awards under the Plan. Participants should consult with their individual tax advisers to determine the tax consequences associated with awards granted under the Plan. This information may not be applicable to employees of foreign subsidiaries or to employees who are not residents of the United States.

Ø

Non-Qualified Stock Options.

A participant will not recognize any income at the time of grant. On the date the participant exercises thenon-qualified stock option, the participant will recognize ordinary income in an amount equal to the excess of the fair market value of the shares on the date of exercise over the exercise price. The participant will be responsible for remitting to the Company the withholding tax obligation that arises at the time the option is exercised. The Company generally will receive a tax deduction for the same amount of ordinary income recognized by the participant. When the participant sells these shares, any gain or loss recognized by the participant is treated as either short-term or long-term capital gain or loss depending on whether the participant has held the shares more than one year.

Ø

Incentive Stock Options.

A participant will not recognize any income at the time of grant. If the participant is issued shares pursuant to the exercise of an incentive stock option, and if the participant does not make a disqualifying disposition of the shares within one year after the date of exercise or within two years after the date of grant, the participant will not recognize any income, for federal income tax purposes, at the time of the exercise. When the participant sells the shares issued pursuant to the incentive stock option, the participant will be taxed, for federal income tax purposes, as a long-term capital gain on any amount recognized by the participant in excess of the exercise price, and any loss sustained by the participant will be a long-term capital loss. No deduction will be allowed to the Company for federal income tax purposes. If, however, the participant sells the shares before the expiration of the holding periods, the participant will recognize ordinary income on the difference between the exercise price and the fair market value at exercise, and the Company generally will receive a tax deduction in the same amount. Upon exercise of an incentive stock option, the excess of the fair market value over the exercise price is an item of tax preference to the participant for purposes of determining the alternative minimum tax. In order to qualify as an incentive stock option, the option must be exercised no later than three months after the participant’s termination of employment for any reason other than death or disability and no later than one year after termination of the participant’s employment due to disability. If the option is not exercised within this time period, it will be treated as anon-qualified stock option and taxed accordingly.

Ø

Restricted Stock Awards/Share Units.

If a participant receives a stock award, the participant will recognize ordinary income upon becoming entitled to transfer the shares at the end of the restriction period without forfeiture. A participant generally will recognize ordinary income when the participant receives cash or shares pursuant to the settlement of share units, provided that if the shares are subject to any further restrictions on transfer, the participant will recognize ordinary income upon becoming entitled to transfer the shares at the end of the restriction period without forfeiture. The amount of income the participant recognizes will be equal to the fair market value of the shares on such date, or the amount of cash received less the amount paid by the participant for the

shares. This amount will also be the participant’s tax basis for the shares. The participant will be responsible for remitting to the Company the withholding tax obligation that arises at the time the ordinary income is recognized. In addition, the holding period begins on the day the restrictions lapse, or the date the shares are received if not subject to any restrictions, for purposes of determining whether the participant has long-term or short-term capital gain or loss on a subsequent sale of the shares. The Company generally will be entitled to a deduction with respect to the ordinary income recognized by the participant. If a participant who receives a stock award subject to restrictions makes an election under Section 83(b) of the Code within 30 days after the date of the grant, the participant will have ordinary income equal to the fair market value on the date of grant, less the amount paid by the participant for the shares, and the participant will recognize no additional income until the participant subsequently sells the shares. The participant will be responsible for remitting to the Company the withholding tax obligation that arises at the time the ordinary income is recognized. When the participant sells the shares, the tax basis will be equal to the fair market value on the date of grant and the holding period for capital gains purposes begins on the date of the grant. If the participant forfeits the shares subject to the Section 83(b) election, the participant will not be entitled to any deduction, refund, or loss for tax purposes (other than a capital loss with respect to the amount previously paid by the participant), and the Company will have to include the amount that was previously deducted from our gross income in the taxable year of the forfeiture.

Ø

SARs.

A participant will not recognize any income at the time of the grant of an SAR. Upon exercise of the SAR, the participant will recognize ordinary income equal to the amount received upon exercise. The participant will be responsible for remitting to the Company the withholding tax obligation that arises at the time the ordinary income is recognized. The Company generally will be entitled to a deduction with respect to the ordinary income recognized by the participant.

SEC Registration

Pursuant to the Securities Act of 1933, as amended, we intend to file a registration statement with the SEC, on FormS-8, relating to the issuance of additional common stock under the Plan as soon as practicable, if the proposed Amendment is approved by our stockholders.

New Plan Benefits; Contingent Awards

The Company has not approved any awards conditioned on stockholder approval of the Plan proposal. If the Plan is approved by the Company’s stockholders, the Committee, in its sole discretion, will select the participants to receive awards as well as the size and types of those awards. Thus, the Company cannot currently determine the benefits or number of shares subject to awards that may be granted in the future to particular individuals or groups under the Plan.

Stock options and share units awarded to the Company’s named executive officers in 2017 under the 2013 Plan are set forth in the “Grants of Plan-Based Awards” table. If the proposed increase in the share limit had been in effect during 2017, the Company expects that its award grants for 2017 would not have been substantially different from those actually made in that year.

As of March 7, 2018, the fair market value of a share of Company common stock was $12.02.

Vote Required for Approval

Approval of the Amendment requires the affirmative vote of the holders of a majority of the shares present in person or represented by proxy and entitled to vote at the 2018 Annual Meeting.

RECOMMENDATION

We believe stockholders should support this proposal to amend the SunCoke Energy, Inc. Long-Term Performance Enhancement Plan for the following reasons:

Share-based compensation is a major component of executive compensation, allowing the Compensation Committee to more effectively align employee incentives with stockholder interests.

We have used shares judiciously. This is our first request for additional shares since the Company’s initial public offering, or IPO, in July 2011. Our average annual share usage rate of 1.3% is below the median share usage rate of our peer companies.

We have a higher percentage of performance-based stock awards and a lower percentage of stock options and time-based restricted stock awards, compared to our peer companies and general industry.

During periods when our share price declined significantly, we took aggressive steps to conserve shares, including temporarily shifting value from long-term share-based awards to cash awards and reducing the portion of awards granted as stock options.

The Board of Directors recommends a vote “FOR” approval of the amended Plan.

PROPOSAL 3 -- ADVISORY APPROVAL OF EXECUTIVE COMPENSATION

 

 

The Dodd-Frank Act enables our stockholdersshareholders to vote to approve, on anon-binding, advisory basis, the compensation of our NEOs as disclosed in this proxy statement pursuant to Item 402 of RegulationS-K under the Securities Exchange Act of 1934, as amended, or Exchange Act, including the Compensation Discussion and Analysis, the compensation tables and the accompanying narrative disclosure.

Our strategy with respect to compensation of our NEOs focuses upon tying compensation to stockholdershareholder value over the long-term. Our compensation structure has a strong performance orientation with a significant portion of pay at risk based on short and longer-term performance. The level of pay at risk increases progressively at positions of greater responsibility. Our compensation levels use the median of the market as a reference point, with flexibility for individual experience and performance. The market is defined by reference to general industry, as well as a specific peer group. Leadership compensation is aligned with stockholders’ interests;shareholders’ interests: leadership will be rewarded when the interests of stockholdersshareholders are advanced, and realize compensation reductions when the share price declines.Company fails to perform. The compensation structure supports our need to attract and retain top level talent and individuals with critical skills and top performers.skills. We provide competitive benefits in a manner that emphasizes flexibility and the avoidance of legacy liabilities (for example, no defined benefit plan or retiree medical plan).

We are asking our stockholdersshareholders to indicate their support for our NEO compensation structure as described in this proxy statement. This proposal, commonly known as a“say-on-pay” proposal, gives our stockholdersshareholders the opportunity to express their views on our NEOs’ compensation. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our NEOs and the philosophy, policies and practices described in this proxy statement.

Thesay-on-pay vote to approve our executive compensation is advisory, and therefore not binding on SunCoke Energy, the Compensation Committee or the Board of Directors. Our Board of Directors and our Compensation Committee value the opinions of our stockholdersshareholders and to the extent there is any significant vote against the NEO compensation as disclosed in this proxy statement, we will consider our stockholders’shareholders’ concerns and the Compensation Committee will evaluate whether any actions are necessary to address those concerns.

The current frequency of our stockholdershareholder advisory vote on executive compensation is annually, and the next such vote will be held at our 20172022 Annual Meeting of Stockholders.shareholders.

RECOMMENDATION

We believe our stockholdersshareholders should support our compensation structure for the following reasons:

 

Our compensation structure is aligned with the interests of our stockholders. Relative to our peer groupshareholders. Our annual incentive has a corporate balance of 80% financial operational metrics and based on industry surveys, our percentage20% safety and environmental operational metrics. Our mix of performance-based equity is greater than that of most other companies.consistent with our peer group and industry practices, and rewards cumulative financial performance, as well as shareholder return.

 

Our metrics and targets are aggressive, and we have been challenged historically to achieve them.

 

We do not have practices or provisions in our plans that are considered excessive or inappropriate.

During periods of underperformance, we have taken decisive action to control costs, including compensation costs. We also restructured our equity programs to reduce share usage during a period when our share price had declined significantly.

Our executives have been appropriately rewarded or penalized for financial, safety and environmental operational performance and share price performance, as realizable and realized pay historically has reflected total shareholder return.

The Board of Directors recommends you vote FOR“FOR” the advisory approval of our executive compensation.

PROPOSAL 4 -- ADVISORY VOTE TO APPROVE THE FREQUENCY OF FUTURE ADVISORY VOTES ON EXECUTIVE COMPENSATION

The Securities Exchange Act of 1934 requires companies to hold a non-binding stockholder vote, at least once every six years, to determine whether future advisory votes on executive compensation of the nature reflected in Proposal 3 should occur. Our Board of Directors values the input of stockholders regarding our executive compensation practices. Stockholders can advise the Board of Directors on whether such votes should occur every year, every two years or every three years, or may abstain from voting. After careful consideration of the outcome of the stockholder vote on this matter at our 2012 Annual Meeting of Stockholders, at which a majority voted in favor of holding an annual advisory vote, and after reviewing the current preference evident from voting results at other comparable companies, our Board of Directors recommends that future advisory votes on executive compensation occur every year (i.e., annually).

This recommendation reflects our commitment to strong corporate governance and accountability to our stockholders. Our Board of Directors believes that an annual advisory vote to approve executive compensation will allow our stockholders to provide timely, direct input on our executive compensation philosophy, policies and practices as disclosed in the proxy statement each year. The Board of Directors also believes that an annual vote is therefore consistent with our efforts to engage in anon-going dialogue with our stockholders on executive compensation and corporate governance matters.

The advisory vote on the frequency of future advisory votes to approve executive compensation is non-binding on the Board of Directors. Stockholders will be able to specify one of four choices for this proposal: one year, two years, three years or abstain. Stockholders are not voting to approve or disapprove the Board of Directors’ recommendation. Although the proposal is non-binding, the Board of Directors and the Compensation Committee will carefully review the voting results. Notwithstanding the Board of Directors’ recommendation and the outcome of the stockholder vote, the Board of Directors may in the future decide to conduct advisory votes on a less frequent basis and may vary its practice based on factors such as discussions with stockholders and the adoption of material changes to compensation programs.

RECOMMENDATION

The Board of Directors recommends that you vote for “ONE YEAR” to hold a stockholder advisory vote to approve executive compensation each year.

 

BENEFICIAL STOCK OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND PERSONS OWNING MORE THAN FIVE PERCENT OF COMMON STOCK

 

 

Beneficial Stock Ownership of Persons Owning More Than Five Percent of Common Stock

The following table shows the amount of our common stock beneficially owned by stockholders whowhom we know to be the beneficial owners of more than 5% of the outstanding shares of SunCoke Energy common stock.Common Stock. The nature of beneficial ownership is sole voting and dispositive power, unless otherwise noted.

 

Name

   Shares of Common
Stock
    Percent of Common
Stock Outstanding
 
           

BlackRock, Inc.(1)

   8,444,996    13.10

Dimensional Fund Advisors LP(2)

   5,440,218    8.45

The Vanguard Group(3)

   4,911,628    7.63

Boston Partners(4)

   4,594,984    7.14

Mangrove Partners Master Fund, Ltd.(5)

    3,115,439     4.84

Name

   Shares of Common
Stock
     Percent of Common  
Stock Outstanding

BlackRock, Inc. (1)

    13,081,525    15.80%

The Vanguard Group (2)

    5,181,064    6.26%

Renaissance Technologies Holdings Corporation (3)

    4,773,317    5.77%

Dimensional Fund Advisors LP (4)

     4,631,782     5.60%

 

(1)

Number is as of December 31, 20172020 and is based on information contained in ScheduleForm 13G filed with the Securities and Exchange CommissionSEC on January 17, 2018.25, 2021. BlackRock, Inc. has sole voting power with respect to 8,271,87812,912,759 shares, and sole dispositive power with respect to 8,444,99613,081,525 shares. The mailing address of BlackRock, Inc. is 55 East 52nd Street, New York, NY 10055.

 

 

(2)

Number is as of December 31, 20172020, and is based on information contained in Schedule 13G filed with the Securities and Exchange CommissionSEC on February 9, 2018. Dimensional Fund Advisors LP has shared voting power with respect to 5,220,205 shares, and shared dispositive power with respect to 5,440,218 shares. The mailing address of Dimensional Fund Advisors LP is Building One, 6300 Bee Cave Road, Austin, TX 78746.

(3)

Number is as of December 31, 2017, and is based on information contained in Schedule 13G filed with the Securities and Exchange Commission on February 7, 2018.10, 2021. The Vanguard Group has:sole voting power with respect to 68,3440 shares; shared voting power with respect to 12,89994,028 shares; sole dispositive power with respect to 4,833,6865,017,158 shares; and shared dispositive power with respect to 77,942163,906 shares. The mailingprincipal business office address of The Vanguard Group is 100 Vanguard Blvd., Malvern, PA 19355.

 

 

(3)

Number is as of December 31, 2020 and is based on information contained in Schedule 13G filed jointly by Renaissance Technologies Holdings Corporation and Renaissance Technologies LLC (collectively, “Renaissance”) with the SEC on February 11, 2021. Renaissance has sole voting power with respect to 4,483,682 shares, and sole dispositive power with respect to 4,773,317 shares. The mailing address of Renaissance Technologies Holdings Corporation is 800 Third Avenue, New York, NY 10022.

(4)

Number is as of December 31, 20172020 and is based on information contained in Schedule 13G filed with the Securities and Exchange CommissionSEC on February 13, 2018. Boston Partners12, 2021. Dimensional Fund Advisors LP has sole voting power with respect to 4,170,115 shares and shared voting power with respect to 34,6454,416,428 shares, and sole dispositive power with respect to 4,594,9844,631,782 shares. The mailing address of Boston PartnersDimensional Fund Advisors LP is 6300 Bee Cave Road, Building One, Beacon Street - 30th floor, Boston, MA 02108.

(5)

Number is as of December 31, 2017 and is based on information contained in Schedule 13G filed with the Securities and Exchange Commission on February 14, 2018. Mangrove Partners Master Fund, Ltd. has shared voting and dispositive power with respect to 3,115,439 shares. The mailing address of Mangrove Partners Master Fund, Ltd. is c/o Maples Corporate Services, Ltd., P.O. Box 309, Ugland House, South Church Street, George Town, Grand Cayman, Cayman Is.KY1-1104.Austin, TX 78746.

 

Beneficial Stock Ownership of Directors and Executive Officers

The following table shows the amount of our common stockCommon Stock beneficially owned as of March 7, 201815, 2021 by each director of SunCoke Energy, by each of our current NEOs and by all current directors and executive officers of SunCoke Energy as a group. Each person has sole investment and voting power over the securities listed in the table.

 

Name 

Shares of

Common

Stock

 

Right to
Acquire Within
60 days After

March 7, 2018(1)

     Total 

Percent of

Common

Stock

    Outstanding    

  Shares of
Common
Stock
 Right to
Acquire Within
60 days After
March 15, 2021 (1)
   Total Percent of
Common
Stock
    Outstanding    
                     

Michael G. Rippey

  0       0   *   128,234  160,272   288,506  *

John W. Rowe

  5,000(2)       5,000   * 

Andrew D. Africk

  23,990       23,990   * 

Arthur F. Anton

  0(2)      0  *

Alvin Bledsoe

  5,934(2)       5,934   *   7,369(2)      7,369  *

Peter B. Hamilton

  63,490       63,490   * 

Martha Z. Carnes

  2,394(2)     2,394  *

Ralph M. Della Ratta, Jr.

  2,559     2,559  *

Susan R. Landahl

  0       0   *   0(2)      0  *

Robert A. Peiser

  23,990       23,990   * 

Michael W. Lewis

  0(2)     0 

James E. Sweetnam

  0       0   *   26,694(2)      26,694  *

Fay West

  26,305   144,813    171,118   *   158,924  231,791   390,715  *

P. Michael Hardesty

  67,983   97,691    165,674   *   161,920(3)   140,682   302,602  *

Gary P. Yeaw

  44,070   77,854    121,924   * 

Katherine T. Gates

  7,916   29,457   37,373   *   74,367(3)   71,757   146,124  *

All directors and executive officers as a group (12 persons)

  268,678   349,815   618,493   * 

John F. Quanci

  19,922  54,423  74,345  *

All directors and executive officers as a group (13 persons)

  591,560  679,167  1,270,727  1.53%

 

*

Less than one percent of our outstanding common stock.

 

 (1)

The amounts shown in this column reflect shares of SunCoke common stockCommon Stock which the persons listed have the right to acquire as a result of the exercise of stock options, and/or conversion of restricted share units, within 60 days after March 7, 201815, 2021 under certain plans, including the SunCoke Energy, Inc. Long-Term Performance Enhancement Plan.

 

 (2)

Certain directors have elected to defer their stock awards into common share units under the Directors’ Deferred Compensation Plan described on pages 18 through 20page 25 of this proxy statement. Each common share unit is treated as if it were invested in shares of common stock, but these common share units do not have voting rights. Dividend equivalents are credited in the form of additional common share units. Such common share units will be settled in cash following termination of the director’s service on the Board of Directors, based upon the average closing price for a share of our common stockCommon Stock for the ten trading days on the NYSE immediately prior to the payment date. The following directors hold such common share units: Mr. Anton: 24,882 units; Mr. Bledsoe: 59,939121,283 units; Ms. Carnes: 34,017 units; Ms. Landahl: 3,52064,261 units; Mr. Rowe: 58,780Lewis: 1,861 units; and Mr. Sweetnam: 60,642125,664 units.

Certain of our directors and executive officers own common units representing limited partnership interests of SunCoke Energy Partners, L.P., a master limited partnership in which SunCoke Energy has a 61.2% ownership interest. The number of such common units beneficially owned by individuals listed in the “Beneficial Stock Ownership of Directors and Executive Officers” Table as of March 7, 2018 is as follows (each person has sole investment and voting power over the securities listed):

Name

    Number of
SXCP
Common
Units
     Right to Acquire
Within 60 days
After
March 7, 2018
     Total     Percent of
SXCP
Common
Units
Outstanding
 
                         

Michael G. Rippey

   0        0    * 

John W. Rowe

   0        0    * 

Andrew D. Africk

   0        0    * 

Alvin Bledsoe

   1,000        1,000    * 

Peter B. Hamilton

   0        0    * 

Susan R. Landahl

   0        0    * 

Robert A. Peiser

   0        0    * 

James E. Sweetnam

   16,100        16,100    * 

Fay West

   0        0    * 

P. Michael Hardesty

   2,431        2,431    * 

Gary P. Yeaw

   2,500        2,500    * 

Katherine T. Gates

      0              0       * 

All directors and executive officers as a group (12 persons)

      22,031              22,031       * 

*Less than one percent of Mr. Bledsoe and Mr. Sweetnam are retiring from the total number of the issued and outstanding common units, representing limited partnership interestsBoard in SunCoke Energy Partners, L.P.May 2021.

 

 (1)(3)

In connection with his service onMs. Gates and Mr. Hardesty also participate in the boardunitized stock funds of SunCoke Energy’s 401(k) and/or Savings Restoration Plans. They hold units of the general partnerapplicable funds (rather than actual shares of our sponsored master limited partnership, Mr. Bledsoe has electedcompany stock) within these Plans. In addition to defer his common unit retainer into phantom unit credits under the SunCoke Energy Partners, L.P. Directors’ Deferred Compensation Plan. Each phantom unit credit is treated as if it were investedshare ownership data presented in the commonforegoing table, as of March 15, 2021: (i) Ms. Gates holds 3,728 units, representing limited partner interestsvalued at $4.01/unit, in the master limited partnership. Such phantom Savings Restoration Plan stock fund, representing a beneficial ownership interest of approximately 2,071 shares of SunCoke common stock; and (ii) Mr. Hardesty holds 18,690 units, valued at $3.66/unit, credits do not have voting rights. Distribution equivalents are credited in the form401(k) Plan stock fund, and 20,204 units, valued at $4.01/unit, in the Savings Restoration Plan stock fund, representing a beneficial ownership interest of additional phantomapproximately 20,697 shares of SunCoke common stock. Equivalent current market value share ownership represented by these units was derived, in each case, by multiplying the number of units held by the current value per unit, credits. Following termination of Mr. Bledsoe’s service on the general partner’s board, these phantom unit credits units will be settled in cash based upon the averageand then dividing by $7.22/common share (NYSE closing price of a common unit for the ten trading days on the NYSE immediately prior to the payment date. As of March 7, 2018, Mr. Bledsoe held 348 phantom unit credits.15, 2021).

 

AUDIT COMMITTEE MATTERS

 

 

Audit Committee Report

The following is the report of the Audit Committee dated February 14, 201825, 2021 with respect to SunCoke Energy’s audited financial statements for the year ended December 31, 2017.2020. The information contained in this report shall not be deemed “soliciting material” or otherwise considered “filed” with the SEC, and such information shall not be incorporated by reference into any future filing under the Securities Act of 1933, as amended, or under the Exchange Act, except to the extent that SunCoke Energy specifically incorporates such information by reference in such filing:

The Audit Committee consists of three members: Ms. Carnes and Messrs. Bledsoe, HamiltonDella Ratta and Sweetnam.Lewis. All of the members of the Audit Committee are independent directors under the NYSE and SEC audit committee membership requirements. The Audit Committee has certain duties and powers as described in its written charter adopted by the Board of Directors.Board. A copy of the charter can be found on our corporate website atwww.suncoke.comwww.SunCoke.com.

The Audit Committee is responsible primarily for assisting the Board of Directors in fulfilling its oversight responsibility of reviewing the financial information that will be provided to stockholders and others, appointing the independent registered public accounting firm and reviewing the services performed by our independent registered public accounting firm and internal audit department. The Audit Committee does not itself prepare financial statements or perform audits and its members are not auditors or certifiers of SunCoke Energy’s financial statements.

In fulfilling its oversight responsibility of appointing and reviewing the services performed by our independent registered public accounting firm, the Audit Committee carefully reviews the policies and procedures for the engagement of our independent registered public accounting firm, including the scope of the audit, audit fees, critical audit matters, auditor independence matters and the extent to which the independent registered public accounting firm may be retained to performnon-audit related services. SunCoke Energy maintains an auditor independence policy that mandates that the Audit Committeepre-approve the audit andnon-audit services and related budget in advance.

The Audit Committee has reviewed and discussed the audited financial statements for the year ended December 31, 20172020 with SunCoke Energy’s management and KPMG LLP (“KPMG”). The Audit Committee also has discussed with KPMG the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board Auditing Standard No. 1301, Communications with Audit Committees.and the SEC.

The Audit Committee also has received and reviewed the written disclosures and the letter from KPMG required by applicable requirements of the Public Company Accounting Oversight Board regarding KPMG’s communications with the Audit Committee concerning independence, and has discussed with KPMG its independence from SunCoke Energy.

Based on the reviews and discussions referred to above, the Audit Committee has recommended to the Board that the financial statements referred to above be included in the Annual Report on Form10-K for the year ended December 31, 2017.2020.

Members of the Audit Committee:

Alvin BledsoeMartha Z. Carnes (Chair)

Peter B. HamiltonRalph M. Della Ratta, Jr.

James E. SweetnamMichael W. Lewis

Audit Fees

The following table sets forth the fees billed by our independent registered public accounting firm for the years ended December 31, 20172020 and December 31, 2016.2019. KPMG LLP served as our principal independent registered public accountant for the fiscal years ended December 31, 20172020 and December 31, 2016.2019. The following table shows the fees billed for audit, audit-related services and all other services for each of the last two years:

 

Audit andNon-Audit Fees(1)
Audit and Non-Audit FeesAudit and Non-Audit Fees
  KPMG LLP
2017
      KPMG LLP
2016
      KPMG LLP
2020
                     KPMG LLP
2019
               

Audit Fees(2)(1)

   $1,440,000     $1,471,300    $1,444,800     $1,667,000   
        

Audit-Related Fees (3)

   139,100         

Tax Fees(4)

   15,110     34,620  

Audit-Related Fees (2)

            

Tax Fees (3)

   13,000      95,000   

All Other Fees

   63,630                    

Total

   $1,657,840      $1,505,920     $1,457,800      $1,762,000    

 

(1)

Effective May 8, 2015, SunCoke formally terminated the services of Ernst & Young LLP (“EY”) as SunCoke’s independent registered public accounting firm. In 2016, EY billed a total of $22,300, reflecting fees associated with certain reviews and the consents required in connection with the filing of SunCoke’s 2016 Annual Report on Form10-K, and a shelf registration statement (Reg.No. 333-212785) on FormS-3, declared effective November 15, 2016.

(2)

Audit fees relate to professional services rendered in connection with the audit of our annual financial statements, audits of our internal control over financial reporting, quarterly review of financial statements included in our Quarterly Reports on Form10-Q, preparation of comfort letters and consents and fees for reviews of our registration statements filed with the SEC, and audit services provided in connection with other statutory and regulatory filings.

 

 

(3)(2)

Audit-related fees relate to assurance and related services that are reasonably related to the performance of the audit or review of our financial statements or that are traditionally performed by the independent auditor (but not included in the audit fees set forth under “Audit Fees” above), such as employee benefit plan audits, and agreed uponagreed-upon procedures required to comply with financial, accounting or regulatory reporting. During 2017, these included fees relating to issuance of comfort letters in connection with certain financing transactions, review of SunCoke’s financial statements in response to an SEC comment letter, and advice on regulatory changes affecting revenue recognition and lease accounting.

 

 

(4)(3)

Tax fees relate to professional services rendered in connection with tax audits, internationalpreparation of tax returns, other tax compliance and internationalservices, and/or tax consulting and planning services.

 

Audit CommitteePre-Approval Policy

SunCoke Energy maintains an auditor independence policy that mandates that the Audit Committeepre-approve the audit andnon-audit services and related budget in advance. The policy:

 

  

identifies the guiding principles that must be considered by the Audit Committee in approving services to ensure that the auditor’s independence is not impaired;

 

 

  

describes the audit, audit-related and tax services that may be provided and thenon-audit services that are prohibited; and

 

 

  

sets forthpre-approval requirements for all permitted services.

 

In some cases,pre-approval is provided by the full Audit Committee for the applicable fiscal year for a particular category or group of services, subject to an authorized amount. In other cases, the Audit Committee specificallypre-approves services. To ensure compliance with the policy, the policy requires that our Vice President and Controller report the amount of fees incurred for the various services provided by the auditor not less frequently than semi-annually. The Audit Committee has delegated authority to its Chair topre-approve one or more individual audit or permittednon-audit services for which estimated fees do not exceed $100,000, as well as adjustments to any estimatedpre-approval fee thresholds up to $50,000 for any individual service. Any suchpre-approvals must then be reported at the next scheduled meeting of the Audit Committee.

 

PROPOSAL 5 --4 – RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

Introduction

The Audit Committee has appointed KPMG LLP to serve as SunCoke Energy’s independent registered public accounting firm for the fiscal year ending December 31, 2018.2021. The Sarbanes-Oxley Act of 2002 requires the Audit Committee to be directly responsible for the appointment, compensation and oversight of the audit work of the independent registered public accounting firm. The Board of Directors is submitting the appointment of KPMG to the stockholders for ratification as a matter of good corporate practice. Should the stockholders fail to ratify the appointment of KPMG, the Audit Committee may reconsider the appointment and may retain KPMG or another accounting firm without resubmitting the matter to stockholders.

Even if the stockholders ratify the appointment of KPMG, the Audit Committee may select another firm if it determines such selection to be in the best interestinterests of SunCoke Energy and our stockholders. Representatives from KPMG are expected to be present at the 20182021 Annual Meeting. The representatives will have the opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions from our stockholders.

RECOMMENDATION

The Board of Directorsunanimously recommends that you vote “FOR” the ratification of the Audit Committee’s appointment of KPMG as SunCoke Energy’s independent registered public accounting firm for the fiscal year ending December 31, 2018.2021.

 

OTHER INFORMATION

 

 

Equity Compensation Plan Information

The following table provides information as of December 31, 20172020 regarding the number of shares of our common stock that may be issued under the LTPEP and the Retainer Stock Plan.

 

Plan category

  No. of securities to be
issued upon exercise
of outstanding options,
warrants and rights

(a)
   Weighted avg.
exercise price of
outstanding options,
warrants and rights
(b) (1)
   No. of securities remaining
available for future issuance
under equity compensation
plans (excluding securities
reflected in column (a))

(c)
   No. of securities to be
issued upon exercise
of outstanding options,
warrants and rights
(a)
   Weighted avg.
exercise price of
outstanding options,
warrants and rights
(b) (1)
   No. of securities remaining
available for future issuance
under equity compensation
plans (excluding securities
reflected in column (a))
(c)
 

Equity compensation plans approved by security holders

   4,054,058(2)           $15.29           1,751,036           4,118,333(2)   $15.02   2,219,867

Equity compensation plans not approved by security holders

   —            —            —                  
  

 

   

 

   

 

   

 

   

 

   

 

 

Total

           4,054,058                    $15.29                   1,751,036(3)        

TOTAL

   4,118,333    $15.02   2,219,867(3) 

 

 (1)

Weighted-average exercise price of outstanding stock options (excludes restricted stock units and performance share units, which were granted at no cost to participants).

 

 (2)

IncludesIncludes: (i) conversions of Sunoco, Inc. common stock to SunCoke Energy, Inc. common stock, upon completion of IPO and final separation from Sunoco on January 21, 20122012; and 2011-2015(ii) 2011-2020 grants made under the LTPEP. Consists of 5,481,1245,827,468 stock options, 1,309,3261,782,211 restricted share units, and 1,191,8051,743,820 performance share units and excludes cancellations, exercises and awards released.

 

 (3)

Consists of 1,399,7081,932,782 shares available for issuance under the LTPEP and 351,328287,085 shares available for issuance under the Retainer Stock Plan for Outside Directors.

Section 16(a) Beneficial Ownership Reporting ComplianceHouseholding of Proxy Materials

Section 16(a)The SEC has adopted rules that permit companies and intermediaries (such as brokers and banks) to satisfy the delivery requirements for proxy statements and annual reports with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which is commonly referred to as “householding,” is also permissible under the General Corporation Law of the Exchange Act requiresState of Delaware and potentially means extra convenience for stockholders and cost savings for companies.

This year, a number of banks and brokers with account holders who are our executive officersstockholders may be householding our proxy materials. A single Notice of Annual Meeting of Stockholders, Proxy Statement and directors,2020 Annual Report will be delivered to multiple stockholders sharing an address unless contrary instructions have been received from one or more of the affected stockholders. Once you have received notice from your bank or broker that it will be householding communications to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and personswould prefer to receive a separate Notice of Annual Meeting of Stockholders, Proxy Statement and 2020 Annual Report please notify your bank or broker and direct your request to Corporate Secretary at SunCoke Energy, Inc., 1011 Warrenville Road, Suite 600, Lisle, Illinois 60532 or (630) 824-1000. Stockholders who beneficially own more than 10% of our common stock, to file initial reports of ownership and reports of changes in ownership with the SEC and to furnish us withcurrently receive multiple copies of the forms they file. Based upon our reviewProxy Statement at their address and would like to request householding of filings made with the SEC and representations made by our directors and executive officers, we believe that our directors and executive officers timely filed all reports required under Section 16(a) during the fiscal year ended December 31, 2017.their communications should contact their bank or broker.

Future Stockholder Proposals

In order for a stockholder proposal to be considered for inclusion in our proxy materials for the 20192022 Annual Meeting, the proposal must be received by our Corporate Secretary at SunCoke Energy, Inc., 1011 Warrenville Road, Suite 600, Lisle, Illinois 60532, on or before November 21, 201825, 2021, and comply with the procedures and requirements set forth in Rule14a-8(e)(2) under the Exchange Act.

In accordance with the advance notice requirements contained in our Amended and Restated Bylaws,the By-laws, for director nominations or other business to be brought before the 2019 Annual Meeting by a stockholder and to be considered for inclusion in our proxy materials for the 2022 Annual Meeting, other than Rule14a-8 proposals described above, written notice must be delivered no earlier than the close of business on January 3, 201913, 2022 and no later than the close of business on February 4, 201911, 2022 to our Corporate Secretary at SunCoke Energy, Inc., 1011 Warrenville Road, Suite 600, Lisle, Illinois 60532.

These stockholder notices must comply with the requirements of our Amended and Restated Bylawsthe By-laws and will not be effective otherwise.

Other Matters

As of the date of this proxy statement, we do not know of any other matters that may be presented for action at the Annual Meeting. However, should other matters properly come before the meeting, the persons named as proxies will vote in a manner as they may, in their discretion, determine.

Websites

Website addresses referenced in this proxy statement are provided for convenience only, and the content on the referenced websites does not constitute a part of this proxy statement.

Solicitation of Proxies

The cost of soliciting proxies in the enclosed form will be borne by SunCoke Energy. In addition to solicitation by mail, our officers and other employees may solicit proxies personally, by telephone, bye-mail and by facsimile. We may request banks and brokers or other similar agents or fiduciaries to transmit the proxy materials to the beneficial owners for their voting instructions and will reimburse them for their expenses in so doing. We have retained Morrow Sodali LLC, 470 West Ave, Stamford, Connecticut 06902, to assist us in the solicitation of proxies for an estimated fee of $9,500,$9,500.00, plus reimbursement of certainout-of-pocket expenses.

By order of the Board of Directors,

 

LOGO

John J. DiRocco, Jr.

Vice President, Assistant General Counsel and Corporate Secretary

Lisle, Illinois

March 21, 201829, 2021

EXHIBITAPPENDIX A

CERTIFICATE OF AMENDMENT

OF

CERTIFICATE OF INCORPORATION

OF

SUNCOKE ENERGY, INC.

LONG-TERM PERFORMANCE ENHANCEMENT PLANSunCoke Energy, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Corporation”), hereby certifies as follows:

(1. The name of the Corporation is SunCoke Energy, Inc. The date of the filing of its original Certificate of Incorporation with the Secretary of State of the State of Delaware was December 8, 2010 (the “Original Certificate”). The name under which the Corporation filed the Original Certificate was SunCoke Energy, Inc.

2. This Amended and Restated EffectiveCertificate of Incorporation (the “Certificate”) amends, restates and integrates the provisions of the Amended and Restated Certificate of Incorporation that was filed with the Secretary of State of the State of Delaware on July 21, 2011 (the “Amended and Restated Certificate”), and was duly adopted in accordance with the provisions of Sections 242 and 245 of the General Corporation Law of the State of Delaware.

3. The text of the Amended and Restated Certificate is hereby amended and restated in its entirety to provide as of February 14, 2018)herein set forth in full:


ARTICLE I

AMENDMENT AND RESTATEMENTNAME OF CORPORATION

The name of the Corporation is SunCoke Energy, Inc. (the “Company”) established the SunCoke Energy, Inc. Long-Term Performance Enhancement Plan (the “Plan”) effective as of July 21, 2011. The Plan was amended and restated effective February 22, 2013, and is hereby further amended and restated effective as of February 14, 2018, subject to approval by the Company’s stockholders at the Company’s annual meeting on May 3, 2018. Awards granted prior to the effective date of the Plan’s amendment and restatement shall be governed by the terms of the Plan as in effect on the grant date of the Award.

ARTICLE II

PURPOSEREGISTERED OFFICE

The purposesaddress of the Plan are to: (a) better align the interests of stockholders and Key Employees by creating a direct linkage between Participants’ rewards and stockholders’ gains; (b) provide Key Employees with the ability to increase equity ownershipCorporation’s registered office in the Company; (c) provide competitive compensation opportunities that can be realized through attainmentState of performance goals; and (d) provide an incentive to Key Employees for continued service withDelaware is 251 Little Falls Drive in the Company.

ARTICLE III

DEFINITIONS

As used in this Plan,City of Wilmington, County of New Castle. The name of its registered agent at such address is Corporation Service Company (CSC®). The Corporation may have such other offices, either within or without the following terms shall haveState of Delaware, as the meanings set forth below:

3.1    “Affiliate” means any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with the Company.

3.2    “Award” means an Option, Restricted Stock, Share Unit or SAR granted pursuant to the termsBoard of Directors of the Plan.

3.3Corporation (theBoard of Directors means) may designate or as the Board of Directorsbusiness of the Company.

3.4    “Change in Control” means the occurrence of any of the following events:

(a)    The acquisition by any person (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) of beneficial ownership (within the meaning of Rule13d-3 promulgated under the Exchange Act) of 20% or more of either (i) the then outstanding shares of Common Stock or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors; provided,however, that for purposes of this clause (a), the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any company controlled by, controlling or under common control with the Company, or (D) any acquisition by any entity pursuant to a transaction that complies with clauses (c)(i), (c)(ii) and (c)(iii) of this definition.

(b)    Individuals who, as of the date that the Plan becomes effective, constitute the Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board of Directors; provided,however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the stockholders of the Company, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board of Directors.

(c)    Consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Company or any of its Subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets or stock of another entity by the Company or any of its Subsidiaries, in each case unless, following such business combination:

(i)    all or substantially all of the individuals and entities that were the beneficial owners of the then outstanding Common Stock and the then outstanding Company voting securities immediately prior to such business combination beneficially own, directly or indirectly, more than 50% of 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, as the caseCorporation may be, of the corporation resulting from such business combination (including, without limitation, a corporation that, as a result of such transaction, owns the Company or all or substantially all of the assets of the Company, either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such business combination of the then outstanding Common Stock and the then outstanding Company voting securities, as the case may be;

(ii)    no person (excluding any corporation resulting from such business combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such business combination or any of their respective subsidiaries) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such business combination or the combined voting power of the then-outstanding voting securities of such corporation, except to the extent that such ownership existed prior to the business combination; and

(iii)    at least a majority of the members of the board of directors of the corporation resulting from such business combination were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board of Directors providing for such business combination; or

(d)    Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

3.5    “Code” means the Internal Revenue Code of 1986, as amended.

3.6    “Committee” means the Compensation Committee of the Board of Directors, as constituted from time to time.The Compensation Committee shall consist of at least two memberstime require.

ARTICLE III

PURPOSE

The purpose of the Board of Directors, each of whom shall meet applicable requirements set forthCorporation is to engage in the pertinent regulations under Section 16 of the Exchange Act.

3.7    “Common Stock” means common stock, par value $0.01 per share, of the Company.

3.8    “Company” means SunCoke Energy, Inc., a Delaware corporation, or any successor thereto.

3.9    “Exchange Act” means the Securities Exchange Act of 1934, as amended.

3.10    “Fair Market Value” means the closing price of a share of Common Stock on the New York Stock Exchange.

3.11    “Incentive Stock Option” or “ISO” means an option granted under Article V that meets the requirements of Section 422(b) (or any successor provision) of the Code.

3.12    “Incumbent Board” has the meaning provided in Section 3.4(b).

3.13    “Just Cause” means, unless otherwise defined in an Award agreement, as determined by the Committee:

(a)    the willful and continued failure of the Participant to perform substantially the Participant’s duties with the Company and its Subsidiaries (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Participant by the Board of Directors or the Chief Executive Officer that specifically identifies the manner in which the Board of Directors or the Chief Executive Officer believes that the Participant has not substantially performed the Participant’s duties;

(b)    indictment of the Participant for a felony in connection with the Participant’s employment duties or responsibilities to the Company and its Subsidiaries that is not quashed within six months;

(c)    conviction of Participant of a felony;

(d)    willful conduct by the Participant in connection with the Participant’s employment duties or responsibilities to the Company and its Subsidiaries that is gross misconduct (including, but not limited to, dishonest or fraudulent acts) and places the Company and its Subsidiaries at risk of material injury; or

(e)    the Participant’s failure to comply with a policy of the Company and its Subsidiaries that places the Company and its Subsidiaries at risk of material injury.

For purposes of this Section 3.13, nolawful act or failure to act, on the part of the Participant shallactivity for which corporations may be considered “willful” unless it is done, or omitted to be done, by the Participant in bad faith or without reasonable belief that the Participant’s action or omission was in the best interests of the Company.In addition, for purposes of this Section 3.13, “injury” shall include, but not be limited to, financial injury and injury to the reputation of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board of Directors or upon the instructions of the Chief Executive Officer or a senior officer of the Company or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Participant in good faith and in the best interests of the Company.

3.14    “Key Employee” means an employee of the Company or any Subsidiary selected to participate in the Plan. A Key Employee may also include a person who is granted an Award in connection with the hiring of the person prior to the date the person becomes an employee of the Company or any Subsidiary, provided that such Award shall not vest prior to the commencement of employment.

3.15    “Option” has the meaning provided in Section 5.1.

3.16    “Optionee” means the holder of an Option.

3.17    “Participant” means a Key Employee selected to receive an Awardorganized under the Plan.

3.18    “Plan” means this SunCoke Energy, Inc. Long-Term Performance Enhancement Plan,DGCL, as amended from time to time.time amended.

3.19    “Qualifying Termination” means, unless otherwise defined in an Award agreement, with respect to the employment of any Participant who is a participant in the SunCoke Energy, Inc. Special

Executive Severance Plan, a “Qualifying Termination” as defined in such plan, and with respect to the employment of any other Participant, the following:

(a)    a termination of employment by the Company within 24 months after a Change in Control, other than for Just Cause, death or permanent disability; or

(b)    a termination of employment by the Participant within 24 months after a Change in Control for one or more of the following reasons:

(i)    the assignment to such Participant of any duties inconsistent in a way significantly adverse to such Participant, with such Participant’s positions, duties, responsibilities and status with the Company and its Subsidiaries immediately prior to the Change in Control, or a significant reduction in the duties and responsibilities held by the Participant immediately prior to the Change in Control, in each case except in connection with such Participant’s termination of employment by the Company for Just Cause;

(ii)    a reduction by the Company in the Participant’s combined annual base salary and guideline (target) bonus as in effect immediately prior to the Change in Control; or

(iii)    the Company requires the Participant to be based anywhere other than the Participant’s present work location or a location within 35 miles from the present location; or the Company requires the Participant to travel on Company business to an extent substantially more burdensome than such Participant’s travel obligations during the period of 12 consecutive months immediately preceding the Change in Control;

provided, however, that in the case of any such termination of employment by a Participant under this subparagraph (b), such termination shall not be deemed to be a Qualifying Termination unless (x) Participant has notified the Company in writing describing the occurrence of one or more such events within 60 days of such occurrence, (y) the Company fails to cure such event within 30 days after its receipt of such written notice and (z) the termination of employment occurs within 120 days after the occurrence of such event.

3.20    “Restricted Stock” has the meaning provided in Section 7.1.

3.21    “Share Units” has the meaning provided in Section 6.1.

3.22    “Stock Appreciation Right” or “SAR” has the meaning provided in Section 8.1.

3.23    “Subsidiary” means any corporation, partnership, joint venture, limited liability company or other entity during any period in which at least a 50% voting or profits interest is owned, directly or indirectly, by the Company or any successor to the Company.

ARTICLE IV

TERM OF PLAN; ADMINISTRATION; TYPES OF AWARDS;

SHARES UNDER AWARDS; AWARD AGREEMENTSSTOCK

4.1Section 1. Authorized Stock. The total number of shares of all classes of stock which the Corporation shall have authority to issue is Three Hundred Fifty Million (350,000,000) shares, consisting of (a) Three Hundred Million (300,000,000) shares of common stock, par value $0.01 per share (the “Common Stock”), and (b) Fifty Million (50,000,000) shares of preferred stock, par value $0.01 per share (the “Preferred Stock”).

Section 2. Term of the PlanCommon Stock.No Awards shallExcept as may otherwise be made underprovided in this Plan after February 14, 2028.The PlanAmended and all Awards made underRestated Certificate of Incorporation, in a Preferred Stock Designation (as hereinafter defined), or as required by law, the Plan prior to such date shall remain in effect until such Awards have been satisfied or terminated in accordance with the Plan and the termsholders of such Awards.

4.2Administration.The Plan shall be administered by the Committee, whichoutstanding shares of Common Stock shall have the authority,right to vote on all questions to the exclusion of all other stockholders, each holder of record of Common Stock being entitled to one vote for each share of Common Stock standing in its sole discretion andthe name of the stockholder on the books of the Corporation.

Section 3. Preferred Stock. Shares of Preferred Stock may be issued from time to time to, among other things:

(a)    designate the Participants;

(b)    grant Awards provided in the Plan in such form and amount as the Committee shall determine;

(c)    determine the terms and conditions of each Award under the Plan and impose such limitations, restrictions and conditions upon any such Award including performance goals, in each case as the Committee shall deem appropriate; and

(d)    interpret the Plan, adopt, amend and rescind rules and regulations relating to the Plan, and make all other determinations and take all other action necessary or advisable for the implementation and administration of the Plan.The decisions and determinations of the Committee on all matters relating to the Plan shall be in its sole discretion and shall be conclusive.No member of the Committee shall be liable for any action taken or not taken or decision made or not made in good faith relating to the Plan or any Award thereunder.

4.3Types of Awards Under the Plan.Awards under the Plan may be in the form of any one or more series. The Board of Directors (or any committee to which it may duly delegate the authority granted in this Article IV) is hereby empowered to authorize the issuance from time to time of shares of Preferred Stock in one or more series, for such consideration and for such corporate purposes as the Board of Directors may from time to time determine, and by filing a certificate pursuant to applicable law of the State of Delaware (hereinafter referred to as a “Preferred Stock Designation”) as it presently exists or may hereafter be amended to establish from time to time for each such series the number of shares to be included in each such series and to fix the designations, powers, rights and preferences of the shares of each such series, and the qualifications, limitations and restrictions thereof to the fullest extent now or hereafter permitted by this Amended and Restated Certificate of Incorporation and the laws of the State of Delaware, including, without limitation, voting rights (if any), dividend rights, dissolution rights, conversion rights, exchange rights and redemption rights thereof, as shall be stated and expressed in a resolution or resolutions adopted by the Board of Directors (or such committee thereof) providing for the issuance of such series of Preferred Stock. Each series of Preferred Stock shall be distinctly designated. The authority of the Board of Directors with respect to each series of Preferred Stock shall include, but not be limited to, determination of the following:

(a)

Options, as described in Article V;

(b)

Share Units, as described in Article VI;

(c)

Restricted Stock, as described in Article VII; and/or

(d)

SARs, as described in Article VIII.

4.4    Shares Under Awards.

(a)    The maximum number(i) the designation of shares of Common Stock thatthe series, which may be delivered to Participants and their beneficiaries under the Plan shall be the sum of (i)by distinguishing number, letter or title;

(ii) the number of shares of Common Stock thatthe series, which number the Board of Directors may be issuable upon exercise or vesting of any Awards initially granted under the Sunoco Long-Term Incentive Plan and (ii) 7,500,000 (which reflects the shares previously authorized under the Plan and an additional 1,500,000 shares to be issued under the Plan pursuant to this most recent amendment and restatement). The limit set forth in this Section 4.4(a) shall be subject to the provisions of Section 9.7.Shares subject to an Award under the Plan may be authorized and unissued Shares or may be treasury Shares.

(b)    During a calendar year, no single Participant who is a Key Employee may be granted:

(i)    Options covering in excess of 1,000,000 shares of Common Stock; or

(ii)    Awardsthereafter (except where otherwise provided in the form of Share UnitsPreferred Stock Designation) increase or Restricted Stock covering in excess of 750,000 shares of Common Stock in the aggregate (or if such Award is settled in cash, an amount equal to the Fair Market Value of such number of shares of Common Stock on the date on which the Award is settled).

The limits set forth in this Section 4.4(b) shall be subject to the provisions of Section 9.7.

(c)    The number of shares of Common Stock delivered by a Participant or beneficiary or withheld by the Company on behalf of any such Participant or beneficiary as full or partial payment of an Award, including the exercise price of an Option or of any required withholding taxes, shalldecrease (but not again be available for issuance pursuant to subsequent Awards, and shall count towards the aggregate number of shares of Common Stock that may be issued under the Plan. Any shares of Common Stock purchased by the Company with proceeds from an Option exercise shall not again be available for issuance pursuant to subsequent Awards, shall count against the aggregate number of shares that may be issued under the Plan and shall not increasebelow the number of shares available underthereof then outstanding);

(iii) the Plan. Ifamounts payable on, and the preferences, if any, of shares of the series in respect of dividends, and whether such dividends, if any, shall be cumulative or noncumulative;

(iv) dates at which dividends, if any, shall be payable;

(v) the redemption rights and price or prices, if any, for shares of the series;

(vi) the terms and amount of any sinking fund provided for the purchase or redemption of shares of the series;

(vii) the amounts payable on, and the preferences, if any, of shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation;

(viii) whether the shares of the series shall be convertible into or exchangeable for shares of any other class or series, or any other security, of the Corporation or any other corporation, and, if so, the specification of such other class or series or such other security, the conversion or exchange price or prices or rate or rates, any adjustments thereof, the date or dates at which such shares shall be convertible or exchangeable and all other terms and conditions upon which such conversion or exchange may be made;

(ix) restrictions on the issuance of shares of the same series or of any other class or series; and

(x) the voting rights, if any, of the holders of shares of the series

there is a lapse, forfeiture, expiration, termination or cancellationARTICLE V

TERM

The term of any Award for any reason, or if shares of Common Stock are issued under such Award and thereafter are reacquired by the Company pursuant to rights reserved by the Company upon issuance thereof, the shares of Common Stock subject to such Award or reacquired by the Company shall again be available for issuance pursuant to subsequent Awards, and shall not count towards the aggregate number of shares of Common Stock that may be issued under the Plan.

4.5    Award Agreements.

(a)    Each Award shall be evidenced by a written Award Agreement specifying the terms and conditionsexistence of the Award. In the sole discretion of the Committee, the Award Agreement may condition the grant of an Award upon the Participant’s entering into one or more of the following agreements with the Company: (i) an agreement not to compete with the Company which shall become effective as of the date of the grant of the Award and remain in effect for a specified period of time following termination of the Participant’s employment with the Company; (ii) an agreement to cancel any employment agreement, fringe benefit or compensation arrangement in effect between the Company and the Participant; and (iii) an agreement to retain the confidentiality of certain information. Such agreements may contain such other terms and conditions as the Committee shall determine. If the Participant shall fail to enter into any such agreement at the request of the Committee, then the Award granted orCorporation is to be granted to such Participant shall be forfeited and cancelled.perpetual.

(b)    An Award Agreement shall contain a vesting schedule as determined in the sole discretion of the Committee; provided that Options and SARs shall not become exercisable until at least one year following the date of grant, and the restrictions on Restricted Stock and Share Units shall not lapse for at least one year following the date of grant; and provided further that notwithstanding the foregoing, no minimum vesting schedule shall apply to Awards that result in the issuance of up to an aggregate of 5% of the shares of Common Stock reserved and available for issuance under Section 4.4(a).

ARTICLE V

OPTIONS

5.1Award of Options.From time to time, subject to the provisions of the Plan and such other terms and conditions as the Committee may prescribe, the Committee may grant to any Participant, one or more Options to purchase the shares of Common Stock (“Options”). Options that are ISOs may be granted only to Key Employees.The grant date for each Option shall be the date of the Committee action to make the Award or, if later, the date selected by the Committee as the date of grant of the Option pursuant to the Plan.

5.2Option Agreements.The grant of an Option shall be evidenced by a written Option agreement, executed by the Company and the holder of an Option, stating the number of shares subject to the Option, the vesting terms, the treatment of the Option upon a Participant’s termination of service, and such other provisions as the Committee may from time to time determine.

5.3Exercise Price. The per share exercise price of each Option shall be not less than the Fair Market Value on the grant date.

5.4Term and Exercise. The term and the vesting schedule of each Option shall be determined by the Committee. No Option shall be exercisable after the expiration of its term and the maximum term of any Option shall be ten years.

5.5Required Terms and Conditions of ISOs.In addition to the foregoing, each ISO granted to a Key Employee shall be subject to the following specific rules:

(a)    The aggregate exercise price of a Key Employee’s ISOs that become exercisable for the first time during a particular calendar year shall not exceed $100,000. If this dollar limit is exceeded, the portion of the ISO that does not exceed the applicable limit shall be an ISO and the remainder shall not be an ISO; but in all other respects, the original Option Agreement shall remain in full force and effect.

(b)    Notwithstanding anything herein to the contrary, if an ISO is granted to a Key Employee who owns more than 10% of the Common Stock (or stock possessing more than 10% of the total combined voting power of all classes of stock of the Company and its Subsidiaries): (i) the exercise price of the ISO shall be not less than 110% of the Fair Market Value on the ISO’s grant date; and (ii) the ISO shall expire, and all rights to purchase Common Stock thereunder shall expire, no later than the fifth anniversary of the ISO’s grant date.

(c)    No ISOs shall be granted under the Plan after ten years from the earlier of the date the Plan’s ISO provisions are adopted or approved by stockholders of the Company.

5.6    Transferability.

(a)    No Option may be transferred by the Participant other than by will, by the laws of descent and distribution or, to the extent not inconsistent with the applicable provisions of the Code, pursuant to a domestic relations order under applicable provisions of law, and during the Participant’s lifetime the Option may be exercised only by the Participant; provided,however, that, subject to such limits as the Committee may establish, the Committee, in its discretion, may allow the Participant to transfer an Option that is not an ISO for no consideration to, or for the benefit of, an immediate family member or to a bona fide trust for the exclusive benefit of such immediate family member, or a partnership or limited liability company in which immediate family members are the only partners or members. Immediate family members are the Participant’s spouse (including common law spouse), siblings, parents, children, step-children, adoptive relations and grandchildren, and shall include the Participant.

(b)    A transfer pursuant to Section 5.6(a) may only be effected following advance written notice from the Participant (or Participant’s estate) to the Committee describing the terms and conditions of the proposed transfer, and such transfer shall become effective only when recorded in the Company’s record of outstanding Options. Any such transfer pursuant to Section 5.6(a) is further conditioned on the Participant and the immediate family member or other transferee agreeing to abide by the Company’s Option transfer guidelines. In the discretion of the Committee, the right to transfer an Option pursuant to Section 5.6(a) also will apply to the right to transfer ancillary rights associated with such Option, and to the right to consent to any amendment to the applicable Option agreement.

(c)    Subsequent transfers by a transferee pursuant to Section 5.6(a) shall be prohibited except in accordance with the laws of descent and distribution, or by will.

(d)    Following any transfer pursuant to this Section 5.6, any transferred Option shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, and the terms “Optionee” or “Participant” shall be deemed to include the transferee; provided,however, that the terms governing exercisability of an Option that apply following any events of termination of employment shall apply based on the employment status of the original Optionee. Neither the Committee nor the Company will have any obligation to inform any transferee of an Option of any expiration, termination, lapse or acceleration of such Option. The Company will have no obligation to register with any federal or state securities commission or agency any Shares issuable or issued under an Option that has been transferred by a Participant under this Section 5.6.

(e)    In no event shall a Participant be permitted to transfer an Option to a third party financial institution without approval of the Company’s stockholders.

5.7Dividends/Dividend Equivalents. No dividends or dividend equivalents shall be paid with respect to any shares subject to an Option prior to the exercise of the Option.

5.8Manner of Payment. Each Option agreement shall set forth the procedure governing the exercise of any portion of the Option granted thereunder, and shall provide that, upon such exercise, the Optionee shall pay to the Company, in full, an amount equal to the product of (a) the exercise price and (b) the number of shares of Common Stock with respect to which Optionee exercises the Option. A Participant may pay the aggregate exercise price through cash payment (including cash received from a broker-dealer to whom the Participant has submitted an exercise notice together with irrevocable instructions to deliver promptly to the Company the amount of sales proceeds from the sale of the shares subject to the Option necessary to pay the exercise price), the delivery of shares of Common Stock owned by the Optionee, or by foregoing delivery of shares of Common Stock subject to the Option, in each case having an aggregate Fair Market Value (as determined as of the date prior to exercise) equal to the aggregate exercise price; provided,however, that any use of shares of Common Stock to satisfy the aggregate exercise price must be in compliance with then applicable accounting rules.

ARTICLE VI

SHARE UNITSBOARD OF DIRECTORS

6.1SectionAward 1. Subject to the rights of Share Units. The Committee,the holders of any series of Preferred Stock to elect directors under specified circumstances, the number of directors shall be fixed from time to time and subjectexclusively pursuant to a resolution adopted by a majority of the total number of directors which the Corporation would have if there were no vacancies.

Section 2. Subject to the provisionsrights, if any, of the Plan, may grant to any Participant Awards denominated in shares of Common Stock (“Share Units”) that will be settled, subject to the terms and conditionsholders of the Share Units, in an amount in cash, shares of Common Stock or both. At the time it authorizes the grantholders of any Share Units,series of Preferred Stock to elect directors under specified circumstances, commencing at the Committee shall condition the vestingannual meeting of stockholders of the Share Units upon (a) continued serviceCorporation that is held in 2021, and at each annual meeting of stockholders of the applicable Participant and/or (b) the attainment of performance goals. Settlement of Share UnitsCorporation thereafter, all directors shall be made either in shares of Common Stock, or in cash,elected to hold office for a one-year term expiring at the sole discretionnext annual meeting of stockholders of Corporation. If authorized by a resolution of the Committee. The mediumBoard of paymentDirectors, directors may be elected to fill any vacancy on the Board of Directors, regardless of how such vacancy shall be set forthhave been created. No decrease in the Committee’s resolution granting the Share Units and in the Share Unit agreement with the Participant.

6.2Share Unit Agreements. Share Units granted under the Plan shall be evidenced by written agreements stating the type of Share Units, the number of Share Units granted,authorized directors which the vesting and settlement terms, the form of payment, the treatment of Share Units upon a Participant’s termination of service, and such other provisions as the Committee may from time to time determine.

6.3Dividend Equivalents. Unless otherwise determined by the Committee, this Section 6.3 shall govern the treatment of dividend equivalents. A holder of Share Units will be entitled to receive payment from the Company in an amount equal to each cash dividend the CompanyCorporation would have paidif there were no vacancies shall shorten the term of any incumbent director. Directors shall hold office until their successors are duly elected and qualified or until their earlier resignation, death or removal.

Section 3. Subject to such holder had he, onapplicable law and the record date for payment of such dividend, been the holder of record of shares of Common Stock equal to the number of outstanding Share Units. The Company shall establish a bookkeeping account on behalf of each Participant in which the dividend equivalents allocated to such shall be credited. The dividend equivalent account will not bear interest. Vesting and payment of dividend equivalents will correspond to the vesting and settlementrights of the Share Unitsholders of any series of Preferred Stock with respect to whichsuch series of Preferred Stock, and unless the dividend equivalents relate.Board of Directors otherwise determines, vacancies resulting from death, resignation, retirement, disqualification, removal from office or other cause, and newly created directorships resulting from any increase in the authorized number of directors, may be filled only by the affirmative vote of a majority of the remaining directors, though less than a quorum of the Board of Directors, and directors so appointed shall hold office for a term expiring at the next annual meeting of stockholders of the Corporation held after such appointment, and until such director’s successor shall have been duly elected and qualified. Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, any director, or the entire Board of Directors, may be removed from office at any time, with or without cause, by the affirmative vote of the holders of at least a majority of the voting power of all of the then-outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors (the “Voting Stock”), voting together as a single class.

Section 4. Notwithstanding any other provision of this Amended and Restated Certificate of Incorporation, the affirmative vote of at least eighty percent (80%) of the voting power of all of the Voting Stock, voting together as a single class shall be required to amend, alter, repeal or adopt any provision as part of this Amended and Restated Certificate of Incorporation inconsistent with the purpose and intent of this Article VI. Neither the amendment, alteration, termination or repeal of this Article VI nor the adoption of any provision inconsistent with this Article VI shall eliminate or reduce the effect of this Article VI in respect of any matter occurring, or any cause of action, suit or claim that, but for this Article VI, would accrue or arise, prior to such amendment, alteration, termination, repeal or adoption.

ARTICLE VII

RESTRICTED STOCKSTOCKHOLDER ACTION

7.1    Award of Restricted Stock.

(a)    The Committee, from time to time, and subject to the provisions of the Plan, may grant to any Participant Awards in the form of actual shares of Common Stock that are subject to restrictions on transfer, the lapse of which restrictions is contingent upon continued service and/or the satisfaction of performance conditions (“Restricted Stock”). Until such restrictions lapse, the shares of Restricted Stock shall be held in “book-entry” form in the records of the Company’s transfer agent, and no shares will be delivered to the Participant until the applicable restrictions lapse.

7.2Restricted Stock AgreementsSection. 1. Restricted Stock granted under the Plan shall be evidenced by written agreements stating the number of shares of Restricted Stock granted, the vesting and settlement terms, the treatment of the Award upon a Participant’s termination of service, and such other provisions as the Committee may from timeSubject to time determine.

7.3Rights of a Stockholder. Except as provided in this Article and in the applicable Award agreement, a Participant shall have, with respect to the shares of Restricted Stock, all of the rights of a stockholder of the Company holding Common Stock, including, if applicable, the right to vote the shares and the right to receive any cash dividends. Vesting and paymentholders of any cash dividends will correspond to the vestingseries of the RestrictedPreferred Stock with respect to which such dividends relate. If so determinedseries of Preferred Stock, any action required or permitted to be taken by the Committee in the applicable Award agreement, (a) cash dividends on the Common Stock subject to the Restricted Stock Award shall be automatically reinvested in additional Restricted Stock, subject to the vestingstockholders of the underlying Restricted Stock, and (b) subject to any adjustment pursuant to Section 9.7, dividends payable in Common Stock shallCorporation must be paid in the formeffected at a duly called annual or special meeting of Restricted Stock, held subject to the vestingstockholders of the underlying Restricted Stock.

ARTICLE VIII

SARs

8.1AwardCorporation. Any action which, under the DGCL, may be taken at a duly called meeting of Options.The Committee, from time to time, and subject to the provisions of the Plan and such other terms and conditions as the Committeestockholders may prescribe, may grant to any Participantbe taken without a meeting by one or more SARs, which upon exercise entitlesconsents in writing, setting forth the Participantaction so taken or to receive from the Company the number of shares of Common Stock having an aggregate Fair Market Value equal to the excess of the Fair Market Value of one share as of the date on which the SAR is exercised over the exercise price, multiplied by the number of shares with respect to which the SAR is being exercised (“SAR”). The grant date for each SAR shall be taken, bearing the date of the Committee action to make the Award or, if later, the date selectedsignature and signed by the Committee as the date of grant of the Option pursuant to the Plan.

8.2SAR Agreements.The grant of an SAR shall be evidenced by a written SAR agreement, executed by the Company and the holder of the SAR, stating the number of shares subject to the SAR, the vesting terms, the treatment of the SAR upon a Participant’s termination of service, and such other provisions as the Committee may from time to time determine.

8.3Exercise Price. The per share exercise price of each SAR shall be not less than the Fair Market Value on the grant date.

8.4Term and Exercise. The term and the vesting schedule of each SAR shall be determined by the Committee. No SAR shall be exercisable after the expiration of its term and the maximum term of any SAR shall be ten years.

8.5Dividends/Dividend Equivalents. No dividends or dividend equivalents shall be paid with respect to any SAR.

8.6Manner of Payment. Each SAR agreement shall set forth the procedure governing the exercise of any portion of the SAR granted thereunder, and shall provide that, upon such exercise, the

Company shall (a) issue the total number of full shares of Common Stock to which the Participant is entitled and cash in an amount equal to the Fair Market Value, as of the date of exercise, of any resulting fractional share, and (b) if the Committee causes the Company to elect to settle all or part of its obligations arising out of the exercise of the SAR in cash, deliver to the Participant an amount in cash equal to the Fair Market Value, as of the date of exercise, of the shares it would otherwise be obligated to deliver.

ARTICLE IX

MISCELLANEOUS

9.1General Restriction. Each Award under the Plan shall be subject to the requirement that if, at any time, the Committee shall determine that: (a) the listing, registration or qualification of the shares of Common Stock subject to the Award upon any securities exchange or under any state or Federal law; (b) the consent or approval of any government regulatory body; or (c) an agreement by the recipient of an Award with respect to the disposition of shares, is necessary or desirable as a condition of, or in connection with, the granting of such Award or the issue or purchase of shares thereunder, then such Award may not be consummated in whole or in part unless such listing, registration, qualification, consent, approval or agreement shall have been effected or obtained free of any conditions not acceptable to the Committee.

9.2Non-Assignability. Except as otherwise set forth in Section 5.6 of the Plan, Awards shall not be assignable or transferable by the recipient thereof, except by will or by the laws of descent and distribution or to the extent not inconsistent with the applicable provisions of the Code, pursuant to a domestic relations order under applicable provisions of law.

9.3Right to Terminate Employment. Nothing in the Plan or in any agreement entered into pursuant to the Plan shall confer upon any Participant the right to continue in the employment of the Company, or affect any right which the Company may have to terminate the employment of, or service by, such Participant. If an Affiliate ceases to be an Affiliate as a result of the sale or other disposition by the Company or one of its continuing Affiliates of its ownership interest in the former Affiliate, or otherwise, then individuals who remain employed by such former Affiliate thereafter shall be considered for all purposes under the Plan to have terminated their employment relationship with the Company and its Subsidiaries.

9.4Non-Uniform Determinations. The Committee’s determinations under the Plan (including without limitation, determinations of the persons to receive Awards, the form, amount and timing of such Awards, the terms and provisions of such Awards, and the agreements evidencing same) need not be uniform and may be made by it selectively among persons who receive, or are eligible to receive, Awards under the Plan, whether or not such persons are similarly situated.

9.5    Rights as a Stockholder; Share Delivery.

(a)    Except as otherwise provided in Section 7.3 with respect to Restricted Stock, a Participant receiving an Award under the Plan shall have no rights as a stockholder with respect thereto unless and until shares of Common Stock are issued on behalf of such Participant.

(b)    Shares of Common Stock issued pursuant to the settlement of an Award shall be represented by stock certificates or issued on an uncertificated basis, with the ownership of such shares by the Participant evidenced solely by book entry in the records of the Company’s transfer agent; provided, however, that upon the written request of the Participant, the Company shall issue, in the name of the Participant, stock certificates representing such shares of Common Stock.

9.6Leaves of Absence. The Committee shallwould be entitled to makevote upon such rules, regulationsaction at a meeting, or by their duly authorized attorneys; The Secretary of the Corporation shall file such consent or consents, or certify the tabulation of such consents and determinations as it deems appropriate underfile such certificate, with the Planminutes of the meetings of the stockholders.

Section 2. Neither the amendment, alteration, termination or repeal of this Article VII nor the adoption of any provision inconsistent with this Article VII shall eliminate or reduce the effect of this Article VII in respect of any leavematter occurring, or any cause of absence taken by the

action, suit or claim that, but for this Article VII, would accrue or arise, prior to such amendment, alteration, termination, repeal or adoption.

ARTICLE VIII

recipient of any Award. Without limiting the generalityAMENDMENTS TO BY-LAWS

In furtherance and not in limitation of the foregoing, the Committee shall be entitled to determine (a) whether or not any such leave of absence shall constitute a termination of employment within the meaning of the Plan and (b) the impact, if any, of any such leave of absence on Awards under the Plan theretofore made to any recipient who takes such leaves of absence.

9.7    Adjustments.

(a)    In the event of a stock dividend, stock split, reverse stock split, share combination, or recapitalization or similar event affecting the capital structure of the Company, the Committee or Board of Directors shall make an equitable and proportionate anti-dilution adjustment. Such mandatory adjustment may include a change in one or more of the following: (i) the aggregate number of shares of Common Stock reserved for issuance and delivery under Section 4.4(a) of the Plan; (ii) the individual limits under Section 4.4(b) of the Plan; (iii) the number of shares or other securities subject to outstanding Awards under the Plan; (iv) the exercise price of outstanding Options; and (v) other similar matters.

(b)    In the event of a merger, amalgamation, consolidation, acquisition of property or shares, separation, spinoff, other distribution of stock or property (including any extraordinary cash or stock dividend), reorganization, stock rights offering, liquidation, or similar event affecting the Company or any of its Subsidiaries that is not an event described in Section 9.7(a), the Committee or the Board of Directors may in its discretion make such substitutions or adjustments as it deems appropriate and equitable to (i) the aggregate number and kind of shares or other securities reserved for issuance and delivery under Section 4.4(a) of the Plan; (ii) the individual limits under Section 4.4(b) of the Plan; (iii) the number and kind of shares of Common Stock or other securities subject to outstanding Awards under the Plan; (iv) the exercise price of outstanding Options; and (v) other similar matters, and such adjustments may include, without limitation, (A) the cancellation of outstanding Awards granted under the Plan in exchange for payments of cash, property or a combination thereof having an aggregate value equal to the value of such Awards, as determined by the Committee or the Board of Directors in its sole discretion (it being understood that in the case of a corporate transaction with respect to which holders of Common Stock receive consideration other than publicly traded equity securities of the ultimate surviving entity, any such determination by the Committee or the Board of Directors that the value of an Option shall for this purpose be deemed to equal the excess, if any, of the value of the consideration being paid for each share of Common Stock pursuant to such corporate transaction over the exercise price of such Option shall conclusively be deemed valid), (B) the substitution of other property (including, without limitation, cash or other securities of the Company and securities of entities other than the Company) for the shares of Common Stock subject to outstanding Awards under the Plan, and (C) arranging for the assumption of Awards granted under the Plan, or replacement of Awards granted under the Plan with new Awards based on other property or other securities (including, without limitation, other securities of the Company and securities of entities other than the Company), by the affected Subsidiary, Affiliate, or division or by the entity that controls such Subsidiary, Affiliate, or division following such transaction as well as any corresponding adjustments to Awards under the Plan that remain based upon Company securities.

9.8Change in Control. The Committee may provide in any Award agreement for provisions relating to a Change in Control, including, without limitation, the acceleration of the exercisability of, or the lapse of restrictions or deemed satisfaction of goals with respect to, any outstanding Awards.

9.9    Amendment of the Plan; Amendment of Awards.

(a)    The Committee may amend, alter, or discontinue the Plan, but no amendment, alteration or discontinuation shall be made which would materially impair the rights of the Participant with respect to a previously granted Award without such Participant’s consent, except such an amendment made to comply with applicable law, including without limitation Section 409A of the Code, stock exchange rules

or accounting rules. In addition, no such amendment shall be made without the approval of the Company’s stockholders to the extent such approval is required by applicable law or the listing standards of the applicable exchange on which the Common Stock is listed.

(b)    The Committee may unilaterally amend the terms of any Award theretofore granted, but no such amendment shall cause an Award, without the Participant’s consent, to materially impair the rights of any Participant with respect to an Award, except such an amendment made to cause the Plan or Award to comply with applicable law, stock exchange rules or accounting rules.

(c)    Notwithstanding the foregoing and except as described in Section 9.7, there shall be no amendment to the Plan or any outstanding Option agreement or SAR agreement that results in the repricing of Options or SARs without stockholder approval. For this purpose, repricing includes (i) a reduction in the exercise price of an Option or SAR or (ii) the cancellation of an Option or SAR in exchange for cash, Options or SARs with an exercise price less than the exercise price of the cancelled Options or SARs, other Awards or any other consideration provided by the Company.

9.10Required Taxes. When an amount first becomes includible in the gross income of a Participant for federal, state, local or foreign income or employment or other tax purposes with respect to any Award under the Plan, as a condition to the issuance or delivery of any shares of Common Stock to the Participant in connection therewith, the Company shall require the Participant to pay the Company the minimum amount of the tax required to be withheld, and in the Company’s sole discretion, the Company may permit the Participant to pay up to the maximum individual statutory rate of applicable withholding. The Committee in its sole discretion may make available one or more of the following alternatives for the payment of such taxes: (a) in cash; (b) in cash received from a broker-dealer to whom the Participant has submitted notice together with irrevocable instructions to deliver promptly to the Company the amount of sales proceeds from the sale of the shares subject to the Award to pay the withholding taxes; (c) by directing the Company to withhold such number of shares of Common Stock otherwise issuable in connection with the Award having an aggregate Fair Market Value equal to the amount of tax to be withheld; or (d) by delivering previously acquired shares of Common Stock that have an aggregate Fair Market Value equal to the amount to be withheld. The Committee shall have the sole discretion to establish the terms and conditions applicable to any alternative made available for payment of the withholding taxes.

9.11Section 409A of the Code. It is the intention of the Company that no Award shall be “deferred compensation” subject to Section 409A of the Code, unless and to the extent that the Committee specifically determines otherwise as provided in the immediately following sentence, and the Plan and the terms and conditions of all Awards shall be interpreted accordingly. The terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code, including any rules for elective or mandatory deferral of the delivery of cash or shares pursuant thereto and any rules regarding treatment of such Awards in the event of a Change in Control, shall be set forth in the applicable Award Agreement, and shall comply in all respects with Section 409A of the Code. Notwithstanding any other provision of the Plan to the contrary, with respect to any Award that constitutes a “nonqualified deferred compensation plan” subject to Section 409A of the Code, any payments (whether in cash, shares or other property) to be made with respect to the Award upon the Participant’s termination of employment shall be delayed until the first day of the seventh month following the Participant’s termination of employment if the Participant is a “specified employee” within the meaning of Section 409A of the Code.

9.12Governing Law.This Plan shall be construed in accordance with and governedpowers conferred by the laws of the State of Delaware.Delaware, the Board of Directors of the Corporation is expressly authorized to make, alter and repeal the By-laws of the Corporation, subject to the power of the stockholders of the Corporation to alter or repeal the By-laws under applicable law as it presently exists or may thereafter be amended. Stockholders of the Corporation are authorized to make, alter and repeal the By-laws of the Corporation only pursuant to Article IX of the By-laws of the Corporation.

ARTICLE IX

DIRECTOR LIABILITY

A director of the Corporation shall not be personally liable either to the Corporation or to any of its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or may hereafter be amended. Any amendment or modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of the Corporation hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or repeal.

ARTICLE X

INDEMNIFICATION

Section 1. Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “Proceeding”), by reason of the fact that he or she or a person of whom he or she is the legal representative is or was, at any time during which this provision is in effect (whether or not such person continues to serve in such capacity at the time any indemnification or advancement of expenses pursuant hereto is sought or at the time any Proceeding relating thereto exists or is brought), a director or officer of the Corporation or is or was at any such time serving at the request of the Corporation as a director, officer, trustee, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans maintained or sponsored by the Corporation (hereinafter, a “Covered Person”), whether the basis of such Proceeding is alleged action in an official

capacity as a director, officer, trustee, employee or agent or in any other capacity while serving as a director, officer, trustee, employee or agent, shall be (and shall be deemed to have a contractual right to be) indemnified and held harmless by the Corporation (and any successor of the Corporation by merger or otherwise) to the fullest extent authorized by the DGCL as the same exists or may hereafter be amended or modified from time to time (but, in the case of any such amendment or modification, only to the extent that such amendment or modification permits the Corporation to provide greater indemnification rights than said law permitted the Corporation to provide prior to such amendment or modification), against all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement) incurred or suffered by such person in connection therewith and such indemnification shall continue as to a person who has ceased to be a director, officer, trustee, employee or agent and shall inure to the benefit of his or her heirs, executors and administrators; provided, however, that except as provided in Section 2 of this Article X, the Corporation shall indemnify any such person seeking indemnification in connection with a Proceeding (or part thereof) initiated by such person only if such Proceeding (or part thereof) was authorized by the Board of Directors.

Section 2. Right of Claimant to Bring Suit. In accordance with the By-laws of the Corporation, if (a) a claim for indemnification under Article VI of the By-laws or Section 1 of this Article X is not paid in full by the Corporation within thirty (30) days after a written claim has been received by the Corporation, or (b) if a request for advancement of expenses under Article VI of the By-laws or Section 1 of this Article X is not paid in full by the Corporation within twenty (20) days after a statement and the required undertaking, if any, have been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim for indemnification or request for advancement of expenses and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim. It shall be a defense to any such action that, under the DGCL, the claimant has not met the standard of conduct which makes it permissible for the Corporation to indemnify the claimant for the amount claimed or that the claimant is not entitled to the requested advancement of expenses, but (except where the required undertaking, if any, has not been tendered to the Corporation) the burden of proving such defense shall be on the Corporation. Neither the failure of the Corporation (including its Board of Directors, independent counsel or stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its Board of Directors, Independent Counsel or stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.

Section 3. Non-Exclusivity of Rights.

(a) In accordance with the By-laws of the Corporation, the rights conferred in this Article XIII as to indemnification, advancement of expenses and otherwise shall be contract rights between the Corporation and each Covered Person to whom such rights are extended that vest at the commencement of such Covered Person’s service to or at the request of the Corporation and (i) any amendment or modification of this Article X that in any way diminishes or adversely affects any such rights shall be prospective only and shall not in any way diminish or adversely affect any such rights with respect to any actual or alleged state of facts, occurrence, action or omission occurring prior to the time of such amendment or modification, or Proceeding previously or thereafter brought or threatened based in whole or in part upon any such actual or alleged state of facts, occurrence, action or omission, and (ii) all of such rights shall continue as to any such Covered Person who has ceased to be a director or officer of the Corporation or ceased to serve at the Corporation’s request as a director, officer, trustee, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, as described herein, and shall inure to the benefit of such Covered Person’s heirs, executors and administrators.

(b) All of the rights conferred in this Article X, as to indemnification, advancement of expenses and otherwise, (i) shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, By-laws, agreement, vote of stockholders or disinterested directors or otherwise and (ii) cannot be terminated by the Corporation, the Board of Directors or the stockholders of the Corporation with respect to a person’s service prior to the date of such termination.

ARTICLE XI

INSURANCE

The Corporation may maintain insurance, at its expense, to protect itself and any current or former director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the DGCL. To the extent that the Corporation maintains any policy or policies providing such insurance, each such current or former director or officer, and each such agent or employee to which rights to indemnification have been granted as provided in Article VI of the By-laws or Section 1 of Article X of this Amended and Restated Certificate of Incorporation, shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage thereunder for any such current or former director, officer, employee or agent.

ARTICLE XII

AMENDMENTS

In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware as they presently exist or may hereafter be amended, subject to any limitations contained elsewhere in this Amended and Restated Certificate of Incorporation, the Corporation may adopt, amend or repeal this Amended and Restated Certificate of Incorporation; provided, however, that Articles VIII, IX, X, XI and this Article XII may only be amended or repealed by the affirmative vote of the holders of record of no less than eighty percent (80%) of the voting power of all of the Voting Stock, voting together as a single class.

4. This amendment and restatement was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware.

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to be executed this day of May, 2021.

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SUNCOKE ENERGY, INC.

By:
Name:
Title:

APPENDIX B

SUNCOKE ENERGY, INC.

By-Law Amendments

In each case, deletions are indicated by strikethroughs and insertions are marked as underlined text:

(a)

1011 WARRENVILLE ROAD

SUITE 600

LISLE, IL 60532Section 3.2 is amended as follows:

Section 3.2. Number, Tenure and Qualifications. Subject to the rights, if any, of the holders of any series of Preferred Stock to elect directors under specified circumstances, the number of directors shall be fixed from time to time exclusively pursuant to a resolution adopted by a majority of the Whole Board. No decrease in the number of authorized directors constituting the Whole Board shall shorten the term of any incumbent director.Directors Commencing at the annual meeting of stockholders of the Corporation that is held in 2022, and at each annual meeting of stockholders of the Corporation thereafter, all directors (other than those who may be elected by the holders of any series of Preferred Stock under specified circumstancesshall be divided, with respect to the time for which they severally hold office, into three classes, as nearly equal in number as is reasonably possible. At each annual meeting of stockholders, (i) directors elected to succeed those directors whose terms then expire shall be elected for a term of office of three years, with each director to hold office until his or her successor shall have been duly elected and qualified; and (ii) if) shall be elected to hold office for a one-year term expiring at the next annual meeting of stockholders of Corporation. If authorized by a resolution of the Board of Directors, directors may be elected to fill any vacancy on the Board of Directors, regardless of how such vacancy shall have been created. Directors shall hold office until their successors are duly elected and qualified or until their earlier resignation, death or removal.

(b)

Section 3.12 is deleted in its entirety and replaced with following text:

Section 3.12. Vacancies. Subject to applicable law and the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, and unless the Board of Directors otherwise determines, vacancies resulting from death, resignation, retirement, disqualification, removal from office or other cause, and newly created directorships resulting from any increase in the authorized number of directors, may be filled only by the affirmative vote of a majority of the remaining directors, though less than a quorum of the Board of Directors, and directors so chosen shall hold officefor a term expiring at the annual meeting of stockholders at which the term of office of the class to which they have been appointed expires and until such director’s successor shall have been duly elected and qualified.

(c)

Section 3.14 is deleted in its entirety and replaced with following text:

Section 3.14. Removal. Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, any director, or the entire Board of Directors, may be removed from office at any time,but only forwith or without cause,and only by the affirmative vote of the holders of at least80 percent a majority of the voting power of all of the then-outstanding shares of Voting Stock, voting together as a single class.

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DETACH AND RETURN THIS PORTION ONLY

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.

 A 

SUNCOKE ENERGY, INC.

Proposals – The Board of Directors recommends youa vote FOR proposal 1:

all the nominees listed and FOR Proposals 2 – 4.             

 

1. To elect two directors to the 2018 Classclass of directors whose term expires in 2021.2024:                                  LOGO
ForAgainstAbstainForAgainstAbstain

01 - Ralph M. Della Ratta, Jr.

02 - Susan R. Landahl

  Nominees:For  AgainstAbstainForAgainstAbstain

2. To vote on amendments to the Company’s Amended and Restated Certificate of Incorporation and its Amended and Restated By- laws to provide for the declassification of the Board

3. To hold a non-binding advisory vote to approve the compensation of the Company’s named executive officers (“Say-on-Pay”).

  For  Against  Abstain        

1a.    Alvin Bledsoe

The Board of Directors recommends you vote FOR proposal 5:

For

  Against

Abstain

1b.    Susan R. Landahl

5.4. To ratify the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2018.2021.

  ☐

The Board of Directors recommends you vote FOR proposals 2 and 3:

    2.To approve the amendment and restatement of the SunCoke Energy, Inc. Long-Term Performance Enhancement Plan.        The shares represented by this proxy when properly executed will be voted inIn the manner directed herein bydiscretion of the undersigned Stockholder(s).If no direction is made, or is unclear, thisproxy will be voted FOR proposals 1, 2, 3 and5, and“1 YEAR”proxies on proposal 4.If anysuch other mattersbusiness as may properly come before the meeting, the person(s) named in this proxy will vote in their discretion.

    3.

To hold a non-binding advisory vote to approve the compensation of the Company’s named executive officers (“Say-on-Pay”).

The Board of Directors recommends you vote 1 YEAR on proposal 4:

1 Year

2 Years

3 Years

Abstain

    4.To hold anon-binding advisory vote on the frequency of futureSay-on-Pay votes.

For address changes and/or comments, please check this box and write them on the back where indicated.

Please indicate if you plan to attend this meeting.

YesNo

Please sign your name exactly as it appears hereon. When signing as attorney, executor, administrator, trustee or guardian, please add your title as such. When signing as joint tenants, all parties in the joint tenancy should sign. If a signer is a corporation or partnership, please sign in full corporate or partnership name by duly authorized officer.

      

 

 B 

Authorized Signatures – This section must be completed for your vote to count. Please date and sign below.

Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.

Date (mm/dd/yyyy) – Please print date below.     Signature 1 – Please keep signature within the box.Signature 2 – Please keep signature within the box.
      /      /    

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03EZXA


The 2021 Annual Meeting of Stockholders of SunCoke Energy, Inc. will be held on

Thursday, May 13, 2021 at 9:00 a.m. Central Time, virtually via the internet at www.meetingcenter.io/290737273.

To access the virtual meeting, you must have the information that is printed in the shaded bar

located on the reverse side of this form.

The password for this meeting is – SUNC2021

Important notice regarding the availability of proxy materials for the annual meeting:

The proxy statement is available electronically at www.envisionreports.com/sxc

LOGO

  

Small steps make an impact.

Help the environment by consenting to receive electronic

delivery, sign up at www.envisionreports.com/sxc

  

LOGO

q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q

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This proxy is solicited on behalf of the Board of Directors for the Annual Meeting of Stockholders on May 13, 2021

The undersigned hereby appoints Michael G. Rippey and Fay West, and each of them as attorney-in-fact, agents and proxies of the undersigned, with full powers of substitution to each, to attend and act as proxies of the undersigned at the annual meeting of stockholders of SunCoke Energy, Inc., to be held on May 13, 2021, at 9:00 a.m., Central Time, Virtual Only, and at all adjournments or postponements thereof, and to vote upon and in respect of the following matters and in accordance with the following instructions the number of shares of common stock, par value $0.01 per share, of SunCoke Energy, Inc. which the undersigned, if personally present, would be entitled to vote.

To participants in the SunCoke Energy, Inc. 401(k) Plan: This proxy/voting instruction card constitutes your voting instructions to the Trustee(s) of such Plan. Non-voted shares will be voted in the same proportion on each issue as the Trustee votes those shares for which it receives voting instructions from participants. Your voting instructions must be received prior to May 9, 2021 at 11:59 p.m. Central Time.

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED ON THIS PROXY, OR IF NO DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED “FOR” PROPOSALS 1 THROUGH 4, AND IN THE DISCRETION OF THE PROXY HOLDERS ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF.

IF VOTING BY MAIL, PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED POSTAGE-PAID REPLY ENVELOPE.


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Using a black ink pen, mark your votes with an X as shown in  this example.

Please do not write outside the designated areas.

  Signature [PLEASE SIGN WITHIN BOX]LOGO    

LOGO

q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q

 A  DateProposals – The Board of Directors recommends a vote FOR all the nominees listed and FOR Proposals 2 – 4.

1. To elect two directors to the class of directors whose term expires in 2024:     Signature (Joint Owners)  DateLOGO
ForAgainstAbstainForAgainstAbstain
     01 - Ralph M. Della Ratta, Jr.02 - Susan R. Landahl  


Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:

The Notice of Annual Meeting and Proxy Statement and Annual Report on Form 10-K are available at

www.proxyvote.com.

 

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E39904-P01629

ForAgainstAbstainForAgainstAbstain
SUNCOKE ENERGY, INC.
Annual Meeting

2. To vote on amendments to the Company’s Amended and Restated Certificate of Stockholders

May 3, 2018, 9:00 a.m.
This proxy is solicited on behalfIncorporation and its Amended and Restated By-laws to provide for the declassification of the Board

3. To hold a non-binding advisory vote to approve the compensation of Directorsthe Company’s named executive officers (“Say-on-Pay”).

The stockholder(s) hereby appoint(s) Michael G. Rippey and Fay West, or either4. To ratify the appointment of them,KPMG LLP as proxies, each with the power to appoint a substitute, and hereby authorize(s) them to represent and to vote, as designated onCompany’s independent registered public accounting firm for the reverse side of this ballot, allfiscal year ending December 31, 2021.

In the discretion of the shares of Common stock of SUNCOKE ENERGY, INC. thatproxies on such other business as may properly come before the stockholder(s) is/are entitled to vote at the Annual Meeting of Stockholders to be held at 9:00 a.m. Central Time on May 3, 2018, at the Hotel Arista, 2139 CityGate Lane, Naperville, Illinois 60563, and any adjournment or postponement thereof.

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO DIRECTION IS MADE, OR IS UNCLEAR, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE DIRECTOR NOMINEES LISTED ON THE REVERSE SIDE, FOR PROPOSALS 2, 3 AND 5, AND “1 YEAR” ON PROPOSAL 4.
IF YOU DO NOT VOTE BY TELEPHONE, OR OVER THE INTERNET, PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED REPLY ENVELOPE.meeting.

 

 B  Authorized Signatures – This section must be completed for your vote to count. Please date and sign below.
Address Changes/Comments:

Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.

Date (mm/dd/yyyy) – Please print date below.

 

 

 

Signature 1 – Please keep signature within the box.

Signature 2 – Please keep signature within the box.

 

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(If you noted any Address Changes/Comments above, please mark corresponding box

  LOGO    1 U P X     4 9 9 9 3 9LOGO   

        03EZYA


Important notice regarding the availability of proxy materials for the annual meeting:

The proxy statement is available electronically at www.edocumentview.com/sxc

q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q

LOGO

This proxy is solicited on behalf of the reverse side.)Board of Directors for the Annual Meeting of Stockholders on May 13, 2021

ContinuedThe undersigned hereby appoints Michael G. Rippey and Fay West, and each of them as attorney-in-fact, agents and proxies of the undersigned, with full powers of substitution to each, to attend and act as proxies of the undersigned at the annual meeting of stockholders of SunCoke Energy, Inc., to be held on May 13, 2021, at 9:00 a.m., Central Time, Virtual Only, and at all adjournments or postponements thereof, and to vote upon and in respect of the following matters and in accordance with the following instructions the number of shares of common stock, par value $0.01 per share, of SunCoke Energy, Inc. which the undersigned, if personally present, would be signedentitled to vote.

To participants in the SunCoke Energy, Inc. 401(k) Plan: This proxy/voting instruction card constitutes your voting instructions to the Trustee(s) of such Plan. Non-voted shares will be voted in the same proportion on reverse sideeach issue as the Trustee votes those shares for which it receives voting instructions from participants. Your voting instructions must be received prior to May 9, 2021 at 11:59 p.m. Central Time.

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED ON THIS PROXY, OR IF NO DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED “FOR” PROPOSALS 1 THROUGH 4, AND IN THE DISCRETION OF THE PROXY HOLDERS ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF.

IF VOTING BY MAIL, PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED POSTAGE-PAID REPLY ENVELOPE.