| ☐ | Preliminary Proxy Statement | |
| ☐ | Confidential, for 14a-6(e)(2)) | |
| ☒ | Definitive Proxy Statement | |
| ☐ | Definitive Additional Materials | |
| ☐ | Soliciting Material §240.14a-12 | |
SunCoke Energy, Inc.
☒ No fee required. ☐Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.(1)Title of each class of securities to which transaction applies:(2)Aggregate number of securities to which transaction applies:(3)Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):(4)Proposed maximum aggregate value of transaction:(5)Total fee paid:☐ Fee paid previously with preliminary materials. ☐ Check box if any part of the fee is offset as providedFee computed on table in exhibit required by Item 25(b) per Exchange Act Rule 0-11(a)(2)Rules 14a-6(i)(1) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.(1)Amount Previously Paid:(2)Form, Schedule or Registration Statement No.:(3)Filing Party:(4)Date Filed:
March 21, 201827, 2024
Dear Stockholder:
You are cordially invited to attend the 20182024 Annual Meeting of Stockholders of SunCoke Energy, Inc., on Thursday, May 3, 201816, 2024 at 9:008:30 a.m., local time,Central Time. We have adopted a virtual meeting format for our 2024 Annual Meeting. We will provide a live webcast of the meeting at https://meetnow.global/MCHDMWX, 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 20182024 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 “Questions and Answers About the 2024 Annual Meeting” beginning on page 158 of the proxy statement.
Whether or not you plan to attend the 20182024 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, | ||||||
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Michael G. Rippey | ||||||
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Katherine T. Gates President and CEO Elect | |||||
SunCoke Energy, Inc. |
1011 Warrenville Road | Suite 600 | Lisle, Illinois 60532 | tel (630) 824-1000 | www.suncoke.com
Notice NOTICE OF 2024 ANNUAL MEETING
| To Be Held on May 16, 2024 8:30 a.m. CDT Online at https://meetnow.global/MCHDMWX |
To the Stockholders of Annual Meeting of Stockholders
to be held on May 3, 2018SunCoke Energy, Inc.:
The 20182024 Annual Meeting of Stockholders of SunCoke Energy, Inc. will(the “2024 Annual Meeting”) is scheduled to be held on Thursday, May 3, 201816, 2024 at 9:008:30 a.m., local time,Central Time, at the Hotel Arista, 2139 CityGate Lane, Naperville, Illinois 60563,https://meetnow.global/MCHDMWX, for the following purposes:
| 1. | To elect |
| 2. | To |
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To ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, |
Stockholders also will transact such other business as may properly come before the 2024 Annual Meeting or any adjournment or postponement thereof.
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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 19, 2024, (the “Record Date”) are entitled to vote at the 2024 Annual Meeting. You may vote at the 20182024 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 20182024 Annual Meeting in person.Meeting. Most stockholders have threefour options for submitting their vote: (1) via telephone, (2) over the Internet, (3) through the mail, or (3) by mail. You may still vote in person if you attend(4) live at the 20182024 Annual Meeting. For further details about voting, please refer to the section entitled “Questions and Answers About the 2024 Annual Meeting” beginning on page 158 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 20182024 Annual Meeting. If you do not instruct your broker on how to vote inwith regard to the election of directors 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 iswill be on or about March 21, 2018,27, 2024, and the attached proxy statement, together with our 20172023 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,
John J. DiRocco, Jr. Vice President, Assistant General Counsel and Corporate Secretary |
TABLE OF CONTENTS
John J. DiRocco, Jr.
Vice President, Assistant General Counsel and Corporate Secretary
March 21, 2018
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SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT i
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
ii
ABOUT THE ANNUAL MEETINGELECTION OF DIRECTORS
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 of Directors of SunCoke Energy, Inc. is soliciting your vote at the 2018 Annual Meeting.
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. You automatically received a paper copy of these materials in the mail.
What am I voting on?
You are voting on the following proposals:
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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 certain amendments to the SunCoke Energy, Inc. Long-Term Performance Enhancement Plan, including an increase in the number of shares of common stock reserved for issuance thereunder;
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; and
Proposal 5: “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.
Who is entitled to vote?
Only stockholders of record at the close of business on March 7, 2018 are entitled to vote at the 2018 Annual Meeting. As of that date, there were 64,587,753 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 2018 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, 2018 must be present in person or by proxy at the meeting. This is referred to as aquorum. Proxy cards or voting instruction forms that reflect abstentions will be counted as shares present to determine whether a quorum exists to hold the 2018 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,” or “ABSTAIN” for each director-nominee. The affirmative vote of a majority of the votes cast for the election of directors at the 2018 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.
ForProposals 2, 3 and 5, you may vote “FOR”, “AGAINST”, or “ABSTAIN,” and the affirmative vote of a majority of the shares present in person or by proxy and entitled to vote on these proposals at the 2018 Annual Meeting is required for approval. Thus, in order to be adopted, Proposals 2, 3 and 5 each must receive more than fifty percent (50%) of the shares present in person or represented by a proxy at the meeting and entitled to vote at the meeting. Abstentions will have the effect of a vote“AGAINST”these proposals. Brokernon-votes will have no effect on the outcome of any of the matters to be voted on in Proposals 2, 3 and 5.
ForProposal 4, you 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 at the 2018 Annual Meeting will be considered the frequency recommended by stockholders. Abstentions and broker non-votes will have no effect on the voting for this proposal.
How do I vote?
You can vote either in person at the 2018 Annual Meeting or by proxy without attending the meeting. Most stockholders have three options for submitting their votes:
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over the Internet, at the address provided on the Notice of Internet Availability or on your proxy card or voting instruction form; or
by 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.
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 2018 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 bring that proxy to the meeting to vote in person at the meeting.
Can I change or revoke my vote?
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 2018 Annual Meeting and voting in person.
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 2018 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. to act as independent inspector of election and as proxy vote tabulator. Broadridge will determine whether or not a quorum is present, will count the shares voted (including shares voted during the Annual Meeting) and will certify the election results.
Can other matters be decided at the 2018 Annual Meeting?
We are not aware of any other matters that will be considered at the 2018 Annual Meeting. If any other matters arise, the named proxies will vote in accordance with their best judgment.
Who can attend the meeting?
The 2018 Annual Meeting is open to all SunCoke Energy stockholders. You may contact Investor Relations for directions atinvestorrelations@suncoke.com. When you arrive at the Hotel Arista, 2139 CityGate Lane, Naperville, Illinois 60563, signs will direct you to the meeting room. You need not attend the 2018 Annual Meeting in order to vote.
If you wish to attend the 2018 Annual Meeting, please check the box on your proxy or voting instruction form, or as indicated on the internet voting site, or press the appropriate key if voting 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, SunCoke Energy, Inc., 1011 Warrenville Road, Suite 600, Lisle, Illinois 60532. Include a copy of your brokerage account statement or an omnibus, or legal, proxy (which you can get from your broker, and which you must have, and bring with you, in order to vote in person 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.
IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 3, 2018:
This proxy statement and our Annual Report on Form10-K for the year ended December 31, 2017 are available in the “Investor Relations” section of our website at the following internet address:http://www.suncoke.com
PROPOSAL 1 — ELECTION 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, Alvin Bledsoe, Peter B. Hamilton,Arthur F. Anton, Martha Z. Carnes, Ralph M. Della Ratta, Jr., Katherine T. Gates, Susan R. Landahl, RobertMichael W. Lewis, Andrei A. Peiser,Mikhalevsky and Michael G. Rippey, John W. Rowe and James E. Sweetnam.Rippey.
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 2021,2027, or until their respective successors are elected and qualified.
Detailed information on these nominees is provided on pages 65 through 11,6, 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 20182024 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 20182024 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 The Board of Directors unanimously recommends that you vote “FOR” the election of the Company’s two nominees for director: Ralph M. Della Ratta, Jr. and Susan R. Landahl. | ||||||
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 1
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Director Nominee Skills, Experience, and Background
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, 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 Directors recommends that you vote “FOR” the electionmanagement to ensure accountability to our stockholders. The following is a summary of some of the two nominees for director.
Certain Information Regarding Directors
Below is information regarding the specificskills, experience, qualifications, attributes and skills that qualify the nominees and thebackground of our directors whose terms of office willare expected to continue after the 2018our 2024 Annual Meeting to serve as a director of SunCoke Energy.Meeting:
Nominees to Serve in a Class Whose
Term Expires in 2021
 Nominee Skills | Anton | Carnes | Della Ratta, Jr. | Gates | Landahl | Lewis | Mikhalevsky | |||||||||||
Strategic Planning/Business Development
|  | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | ||||||||||
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. |  | ✔ | ✔ | ✔ | ✔ | ✔ | ||||||||||||
Information Technology/Data Security Experience General information systems experience. Understanding of information security risk management and oversight of data integrity. |  | ✔ | ✔ | ✔ | ||||||||||||||
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. |  | ✔ | ✔ | ✔ | ✔ | |||||||||||||
Health, Environment and Safety Background Experience in hazardous materials management and environmental compliance; process safety management and “gap” analysis; emergency management and disaster recovery; and occupational health and safety law, regulation, and practice |  | ✔ | ✔ | ✔ | ✔ | |||||||||||||
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 |  | ✔ | ✔ | ✔ | ✔ | ✔ | ||||||||||||
Nominee Diversity | ||||||||||||||||||
Gender Diversity of Directors | ✔ | ✔ | ✔ | |||||||||||||||
Ethnic Diversity of Directors | ||||||||||||||||||
Hispanic or Latinx | ||||||||||||||||||
White | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | ||||||||||||
Black or African American | ✔ | |||||||||||||||||
Asian | ||||||||||||||||||
Native Hawiian or Other Pacific Islander | ||||||||||||||||||
American Indian or Alaska Native | ||||||||||||||||||
In addition, half of our current directors have general manufacturing experience (including development and integration of large-scale production processes), as well as investment banking expertise and a background in the areas of health, environment and safety.
2 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 3
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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.
| (1) | On February 22, 2024, the Company announced Mr.Rippey’s retirement as Chief Executive Officer, and his resignation from the Board, effective May 15, 2024. The Company also announced that Ms. Gates would succeed Mr. Rippey as Chief Executive Officer, effective upon his retirement. |
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. The Governance Committee periodically 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.
4 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Certain Information Regarding Directors
On the following pages is information regarding 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:
Class III: Nominees Up for Election at the 2024 Annual Meeting
Ralph M. Della Ratta, Jr. |
BOARD COMMITTEES • Audit • Compensation (Chair) |
Mr. Bledsoe was elected as a director of SunCoke Energy, Inc. in June 2011. Effective September 1, 2017, he also was appointed as a director of SunCoke Energy Partners GP LLC, the general partner of SunCoke Energy Partners, L.P., our sponsored master limited partnership. From 1972 until his retirement from the firm in 2005, Mr. Bledsoe served in various senior roles at PricewaterhouseCoopers LLP, or PwC (an international accounting firm). In 2007, he joined the Board of Directors of Crestwood Gas Services GP LLC, the general partner of Crestwood Midstream Partners LP (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), 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 as a member of the Archuleta County Colorado Financial Advisory Task Force.
Mr. Bledsoe is an experienced finance and public accounting executive, having spent his entire33-year career with PwC. By virtue of his experience, Mr. Bledsoe is knowledgeable about finance, merger and acquisition transactions and major cost restructurings and possesses knowledge of the mining, utilities 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.
 BUSINESS EXPERIENCE Mr. Della 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 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 acquisition, Mr. Della Ratta served as Co-Head of Merger and Acquisition Advisory Services for Citizens Financial Group, Inc., leading a team focused on delivering M&A services and related financial analysis to middle-market customers. Mr. Della Ratta retired from Citizens on June 30, 2022. He joined Kirtland Capital Partners, a middle market private equity firm, as a partner on July 1, 2022. From 2004 to 2020, Mr. Della Ratta served on the Board of Olympic Steel, Inc. [NASDAQ: ZEUS] (a leading U.S. metals service center), where he was Lead Independent Director, a member of the 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). QUALIFICATIONS Mr. Della Ratta brings valuable business and extensive financial experience to the Board, particularly with regard to capital raising, commercial banking, mergers and acquisitions, strategic financial analysis and capital markets transactions. In addition, Mr. Della Ratta also has knowledge of manufacturing and distribution in the steel and metals services industry. |
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 5
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Susan R. Landahl
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DIRECTOR SINCE 2017 BOARD COMMITTEES • Compensation • Governance (Chair) |
Ms. Landahl was appointed as a director of SunCoke Energy, Inc., effective September 1, 2017. Since June 2015, 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.
BUSINESS EXPERIENCE
Ms. Landahl was appointed as a director of SunCoke Energy, Inc., effective September 1, 2017. From June 2015 until her retirement in January 2021, Ms. Landahl 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 INPO 15-005, now the industry standard for leadership development and organizational effectiveness for the entire U.S. nuclear fleet and much of the world.
QUALIFICATIONS
Ms. Landahl is a knowledgeable and experienced industry leader with strong operational skills and a proven track record for successfully managing large, complex projects. She has a keen and strategic understanding of the energy industry, and possesses senior-level business development, planning and managerial experience.
Continuing Directors — Term Expires in 2019
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6 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One
| The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee
Matters | Proposal Four | Q&A | Other Information | |||||||||||
Mr. Africk was appointed as a director of SunCoke Energy, Inc., effective March 7, 2016. Mr. Africk founded Searay Capital LLC (a private investment company) in 2013. He previously spent 21 years
Class I: Nominees Up for Election at Apollo Global Management LLC (an alternative asset management firm), including 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 serves on the boards of ADT Inc. (the largest home security monitoring company in the U.S.) and of RPX Corp. (a manager of
patent assets for the high technology sector). Mr. Africk’s previous public company board service includes Hughes Communications, Inc. (December 2005 to June 2011), where he served as Chair of the Governance Committee and a member of the Compensation Committee; and Hughes Telematics, Inc. (April 2009 to June 2013), where he served as a member of the Compensation Committee. In addition, Mr. Africk serves on several private company boards, and also is a member of the Board of Overseers of the University of Pennsylvania School of Engineering and the UCLA Science Board.
Mr. Africk has significant strategic planning, business development and managerial skills, with more than 20 years of corporate management 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.2025 Annual Meeting
 Arthur F. Anton (Chairman) |
BOARD COMMITTEES • Compensation |
Mr. Peiser was appointed as a director of SunCoke Energy, Inc., effective March 7, 2016. Mr. Peiser is engaged in active service on public as well as private corporate andnot-for-profit boards. From 2008 to May 2010, Mr. Peiser served as the Chief Executive Officer and 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.
• Governance
OTHER PUBLIC BOARDS
• Diebold Nixdorf Incorporated
• Olympic Steel
• Sherwin-Williams Company
Mr. Peiser is an experienced senior-level corporate executive with general operations, financial management, sales and marketing, strategic planning, corporate restructuring and business development experience. He has operated as chief executive officer and/or chief financial officer of both public and private companies in several industries, including transportation services, energy, food processing, retailing, distribution and telecommunications.
 BUSINESS EXPERIENCE Mr. Anton was appointed as a director of SunCoke Energy, Inc., effective March 16, 2020, and was appointed as non-executive Chairman of the Board effective January 1, 2021. During the course of his career, Mr. Anton has served in various senior roles at The Swagelok Company (a large 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 1998, Mr. Anton was a Partner of Ernst & Young LLP (a professional accounting and consulting services firm), where he consulted with companies in manufacturing, energy, service, and other industries. Mr. Anton currently serves as a director on the boards of the following companies: Olympic Steel [NASDAQ: ZEUS] (a leading U.S. metals service center), where he is 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 on the Audit Committee; and Diebold Nixdorf, Incorporated [NYSE: DBD] (a leading manufacturer of automated teller, calculating, and accounting machinery), where he serves as Chair of the Audit Committee and as a member of the Nominating and Governance Committee. Mr. Anton also serves as Chairman of University Hospitals Health System in the Cleveland, Ohio area. QUALIFICATIONS 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 Ernst & Young LLP and the former Chief Financial Officer of Swagelok, Mr. Anton has financial expertise and extensive financial experience. |
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 7
| Proposal One
| The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee
Matters | Proposal Four | Q&A | Other Information | |||||||||||
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 provider 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 possesses 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.
Continuing Directors — Term Expires in 2020
 Michael W. Lewis |
BOARD COMMITTEES • Audit • Governance | |||
BUSINESS EXPERIENCE Mr. Lewis was appointed as a director of SunCoke Energy, Inc., effective December 3, 2020. During the course of his career, Mr. Lewis 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 2013, 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 growing 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 and advocacy organization promoting economic opportunities by advancing multiracial leadership in corporate governance, executive level management, and business diversity). Mr. Lewis also serves on the Foundation Board of Western Michigan University and has served as past Chairman of the Western Michigan University Business School Advisory Council. QUALIFICATIONS Mr. Lewis is an experienced banking executive who has spent over 40 years in the financial services industry with business line responsibility. He provides significant senior management-level strategic planning, business development and managerial expertise to the Board. |
8 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Mr. Hamilton was elected as a director of SunCoke Energy, Inc. in June 2011. He is
Class II: Nominees Up for Election at the former Senior Vice President 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 Board of Brunswick Corporation from 2000 until his initial retirement in 2007. He joined the Board of Directors of Oshkosh Corporation (a designer, manufacturer and marketer of specialty vehicles and vehicle bodies) in 2011 and is the chair of its Audit Committee.
Mr. Hamilton 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 diesel and natural gas engine designer, manufacturer 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 number of senior positions in the federal government and was an officer in the U.S. Navy.2026 Annual Meeting
 Martha Z. Carnes |
DIRECTOR SINCE 2019 BOARD COMMITTEES • Audit (Chair) OTHER PUBLIC BOARDS • Core Laboratories Inc. • Matrix Service Company | |||
BUSINESS EXPERIENCE Ms. Carnes was appointed as a director of SunCoke Energy, Inc., effective December 5, 2019. From 1982 until her retirement from the firm in June 2016, 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 Board of Core Laboratories Inc. [NYSE: CLB], (one of the world’s largest providers of reservoir description and production enhancement services to the oil and gas industry), where she is the Lead Independent Director and Chairman of the Audit Committee. She is also a director of Matrix Service Company [NASDAQ: MTRX] (a provider of design, engineering, construction, repair and maintenance services to industrial and energy clients in North America), where she Chairs the Audit Committee and serves on the Compensation, and Nominating and Corporate Governance committees. She also is 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 SunCoke Energy Partners GP LLC, the general partner of SunCoke Energy, L.P., our former master limited partnership. QUALIFICATIONS Ms. Carnes is an experienced finance and public accounting executive, having spent her entire 34-year career with PwC. By virtue of her experience, Ms. Carnes possesses strategic planning, managerial and leadership expertise, having led the design and execution of market and sector strategies, business development, compensation, professional development, succession planning, and client satisfaction initiatives for clients in the mining, utilities and energy 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 energy sector. |
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 9
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Andrei A. Mikhalevsky |
AGE: 69 DIRECTOR SINCE 2023 BOARD COMMITTEES • Compensation • Governance | |||
BUSINESS EXPERIENCE Mr. Mikhalevsky was appointed as a director of SunCoke Energy, Inc., effective February 23, 2023. He is the former President and Chief Executive Officer of California Dairies, Inc., a leading milk marketing and
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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 joins SunCoke most recently from Nippon Steel & Sumitomo Metal Corporation (a leading global steelmaker) where, since 2015, he has served as Senior Advisor. From 2014 to 2015, he served as 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), a $1.1 billion steel service center headquartered in Ohio, where he is a member of the Nominating Committee, the Compensation Committee, and 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.
Mr. Mikhalevsky is a highly experienced senior-level executive, with global manufacturing and marketing expertise, as well as senior-level strategic planning and business development experience. He has been significantly engaged in trade advocacy efforts and legislative efforts in Washington D.C. and has testified before congressional committees and subcommittees. In addition, he has extensive board-level oversight experience as a director of several large private companies and industry associations.
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.
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10 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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BOARD COMMITTEES • None | |||
BUSINESS EXPERIENCE Ms. Gates was elected President of SunCoke Energy, Inc., and was appointed as a director on SunCoke’s Board of Directors, effective January 1, 2023. Prior to that, she was Senior Vice President, Chief Legal Officer and Chief Human Resource Officer since November 2019. Ms. Gates served as Senior Vice President, General Counsel and Chief Compliance Officer from October 2015 to November 2019. From July 2014 to October 2015, she was Vice President and Assistant General Counsel, where she focused on litigation, regulatory and commercial matters. In addition, from October 2015 through June 2019, Ms. Gates served as a director of SunCoke Energy Partners GP LLC, the general partner of SunCoke Energy Partners, L.P., our former master limited partnership subsidiary. Ms. Gates joined SunCoke in February 2013 as Senior Health, Environment and Safety Counsel. Ms. Gates practiced law for two decades. As a Partner at Beveridge & Diamond, P.C., she served on the firm’s Management Committee and also co-chaired the civil litigation section of the firm’s Litigation Practice Group. QUALIFICATIONS Ms. Gates’ legal and regulatory knowledge and skills, along with extensive executive experience at SunCoke, provides the Board of Directors with valuable expertise regarding operations, commercial, legal, environmental, health, safety and senior level strategic planning matters. |
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 11
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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, 2018:27, 2024:
Name | Governance | |||||||||||||||||||
Katherine T. Gates | ||||||||||||||||||||
Arthur F. Anton | ✔ | ✔ | ||||||||||||||||||
Martha Z. Carnes | ✔ | * | ||||||||||||||||||
| ✔ | ✔ | * | |||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
Susan R. Landahl | ✔ | * | ||||||||||||||||||
| ||||||||||||||||||||
| ✔ | ✔ | ||||||||||||||||||
Andrei A. Mikhalevsky | ✔ | |||||||||||||||||||
| * | Denotes Committee Chair |
The Board of Directors held 12seven meetings in fiscal 2017.year 2023. Each director who served in fiscal 2017year 2023 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 2023 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.year 2023. The Company does not have a specific policy regarding director attendance at the Annual Meeting. However, all directors attended the 2023 Annual Meeting which was held on May 11, 2023.
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.
CHAIRMAN: Ms. Carnes* MEMBERS: Mr. Della Ratta* Mr. Lewis* *Financial Expert All members of the Audit Committee are “independent” as defined in the listing standards of the New York Stock Exchange, or NYSE, and the rules and regulations of the Securities and Exchange Commission, or SEC. | COMMITTEE KEY RESPONSIBILITIES: The Board has determined that 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 Audit Committee assists the Board 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 permitted non-audit services, (4) oversight and monitoring of the Company’s internal audit function and independent auditors, (5) monitoring compliance by the Company with legal and regulatory requirements, including the Company’s Code of Business Conduct and Ethics; and (6) oversight of the Company’s information technology use and protection including, but not limited to enterprise cybersecurity and privacy. 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 perform non-audit related services. | |
The Board of Directors has adopted a written charter for the Executive Committee, which is available on our corporate website atwww.suncoke.com.
All members of the Audit Committee are “independent” as defined in the listing standards of the New York Stock Exchange (or NYSE) and the rules and regulations of the Securities and Exchange Commission (or SEC). The Audit Committee currently is composed of Messrs. Bledsoe and Hamilton and Ms. Landahl, and is chaired by Mr. Bledsoe. The Board of Directors has determined that Messrs. Bledsoe and Hamilton and Ms. Landahl, 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 Messrs. Bledsoe and Hamilton qualifies 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.
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 2023.
12 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Compensation Committee
The Compensation Committee is composed of Messrs. Africk, Peiser and Sweetnam and is chaired by Mr. Peiser.
CHAIRMAN: Mr. Della Ratta MEMBERS: Mr. Anton Ms. Landahl Mr. Mikhalevsky | COMMITTEE KEY RESPONSIBILITIES: The Compensation Committee is responsible for the approval, evaluation and oversight of | |
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 2023.
The Governance Committee currently is composed of Messrs. Hamilton, Rowe and Sweetnam and Ms Landahl, and is chaired by Mr. Sweetnam. 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.
CHAIRMAN: Ms. Landahl MEMBERS: Mr. Anton Mr. Lewis Mr. Mikhalevsky | COMMITTEE KEY RESPONSIBILITIES: 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, (6) reviews the form and amount of director compensation and makes recommendations to the Board regarding the Company’s director compensation 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 twothree times in fiscal 2017.year 2023.
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.
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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, ensure Board and management accountability, and provide our stockholders with meaningful rights.
We believe that such corporate governance practices 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 (6 out of 7 continuing directors are independent) ✔ Independent Chairman with robust responsibilities ✔ Separate independent Chairman and CEO roles ✔ Majority vote standard for uncontested election of directors ✔ Limitations on outside board and audit committee service ✔ Non-executive directors meet in executive session without management present ✔ Board oversight of sustainability matters and comprehensive annual report addressing environmental and social impact and responsible business practices | ✔ Fully independent Audit, Compensation and Governance Committees ✔ Annual Board and Committee self-evaluations ✔ Robust stock ownership requirements for executive officers and directors ✔ Strong stockholder engagement practices ✔ Greater than 75% attendance at Board and Committee meetings ✔ Code of Business Conduct & Ethics applicable to directors and executive officers ✔ 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-managementnon-executive 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.
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 determinedbelieves 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 non-executive 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.14 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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| • | 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 a day-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 current Chief Executive Officer, Mr. Rippey, and our current President, Ms. Gates, 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.
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 President, our Senior Vice President and Chief Financial Officer and our Senior Vice President, Assistant General Counsel and Chief Compliance 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
Our Board recognizes the importance of maintaining 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 2021, we updated our Audit Committee charter to memorialize the Committee’s role in reviewing cybersecurity matters. The Audit Committee oversees the initial assessment of cybersecurity threats as well as the Company’s approach to management and mitigation of such risks, compliance with industry standards related to cybersecurity, and the Company’s public disclosures related to cybersecurity matters. In addition, our
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Board of Directors devotes regular attention to oversight of cybersecurity risks. At least annually the entire Board of Directors receives an update from our Chief Information Officer detailing our cybersecurity threat risk management and strategy processes. This update covers topics such as data security posture, results from assessments conducted by third parties, progress toward security goals, and any material cybersecurity developments, as well as steps taken in response to such developments. Management has continued to take significant steps to enhance our data security infrastructure and defenses. We utilize third-party experts, independent cybersecurity advisors, and auditors to conduct regular risk assessments, penetration testing, and vulnerability analyses. We also conduct a periodic review of the Company’s cyber insurance policies to ensure appropriate coverage.
Sustainability
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 our Governance Committee provides broad oversight of the Company’s policies, initiatives, objectives and practices regarding safety and 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, our non-executiveChairman presides over the executive sessions of the independent directors. The independent directors met in executive sessions separate from management eightseven times during fiscal 2017.2023.
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.comwww.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 SunCoke Energy (other than options exercised in accordance with the terms of an option plan sponsored by SunCoke Energy) or engage in hedging activities of any kind (e.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
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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 stockCommon 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.
In 2023, we did not engage in any related person transaction(s) requiring disclosure under Item 404 of Regulation S-K.
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.
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.
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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, President, 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
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.18 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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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. The Governance Committee reviews director compensation regularly. On a biennial basis, Meridian Compensation Partners LLC, or Meridian, an independent compensation consulting firm, presents a benchmarking report on director compensation for the same peer group of companies that the Compensation Committee uses to benchmark compensation for our executive. After reviewing the information presented by Meridian and other public information on the topic, the Compensation Committee evaluates the compensation program for our independent directors to ensure that it is consistent with market practice and makes recommendations of appropriate changes to the Board.
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 | ||||||
Annual Retainer (Cash Portion) | ||||||||
Annual Retainer (Cash Portion) | ||||||||
Annual Retainer (Cash Portion) | $ | 90,000 | ||||||
Annual Retainer (Stock Portion) | ||||||||
Annual Retainer (Stock Portion) | ||||||||
Annual Retainer (Stock Portion) | ||||||||
Annual Retainer (Stock Portion) | $ | 110,000 | $ | 120,000 | ||||
COMMITTEE SERVICE | ||||||||
COMMITTEE SERVICE | ||||||||
COMMITTEE SERVICE | ||||||||
COMMITTEE SERVICE | ||||||||
Annualnon-executive Chairman Retainer | $ | 80,000 | ||||||
Annual non-executive Chairman Retainer | ||||||||
Annual non-executive Chairman Retainer | ||||||||
Annual non-executive Chairman Retainer | $ | 80,000 | ||||||
Annual Lead Director Retainer (if applicable) | $ | 30,000 | ||||||
Annual Lead Director Retainer (if applicable) | ||||||||
Annual Lead Director Retainer (if applicable) | ||||||||
Annual Lead Director Retainer (if applicable) | $ | 30,000 | ||||||
Annual Committee Chair Retainers: | ||||||||
Annual Committee Chair Retainers: | ||||||||
Annual Committee Chair Retainers: | ||||||||
Annual Committee Chair Retainers: | ||||||||
• Audit Committee Chair | $ | 25,000 | ||||||
• Audit Committee Chair | ||||||||
• Audit Committee Chair | ||||||||
• Audit Committee Chair | $ | 25,000 | ||||||
• Compensation Committee Chair | $ | 15,000 | ||||||
• All Other Committee Chairs | $ | 10,000 | ||||||
• Compensation Committee Chair | ||||||||
• Compensation Committee Chair | ||||||||
• Compensation Committee Chair | $ | 15,000 | ||||||
• Governance Committee Chair | ||||||||
• Governance Committee Chair | ||||||||
• Governance Committee Chair | ||||||||
• Governance Committee Chair | $ | 12,000 | ||||||
Annual Audit Committee Member Retainer | $ | 10,000 | ||||||
Annual Audit Committee Member Retainer | ||||||||
Annual Audit Committee Member Retainer | ||||||||
Annual Audit Committee Member Retainer | $ | 10,000 | ||||||
Retainer Stock PlanPaid in Shares
The SunCoke Energy, Inc. Retainer Stock Plan for Outside Directors, or Retainer Stock Plan, provides for the payment of aA portion of the independent directors’ annual retainer is paid in the form of our common stock. The Retainer Stock Plan also allows eachCommon Stock. Each independent director toalso may elect to receive payment of all or a portion of his or her annual cash retainer(s)retainer 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.Common Stock.
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 tomay designate his or her deferred compensation asto be delivered in the form of share units, cash units or a combination of both. Cash units accrue interest at a rate set annually by the Governance Committee. Aunits. Each share unit is treated as if it were invested in shares of our common stock,Common Stock, but it does not have voting rights. If shareShare units are chosen,credited with dividend equivalents that entitle the holder to receive payment in an amount equal to the cash dividends payable on a number of shares of Common Stock equal to the number of outstanding share units. The dividend equivalents are credited in the form of additionalto a bookkeeping account for each director who has share units. PaymentsThe dividend equivalent account does not bear interest. Payment of compensation deferred underdividend equivalents coincides with the Directors’ Deferred Compensation Plan will be made at,settlement of the related share units. Independent directors may choose to receive their aggregate share units paid out in a lump sum, or commenceas a series of up to three approximately equal annual installments, commencing 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 successivethey leave the Board. Successive annual installment payments to beare made no earlier than January 15 of each such year. Share units are settled in cash based upon the average closing price for a sharean equivalent number of our common stock for the ten trading daysshares of Common Stock on the NYSE immediately prior to the payment date.
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Director Stock Ownership Guidelines
Each independent director is expected to own a number of shares of our common stockCommon Stock having an aggregate market value equal to at least five times the independent director’s annual cash retainer. SunCoke common shareShare units that are credited to an independent director’s deferred compensation account under the Directors’ Deferred Compensation Plandirector 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.our 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, all2023, each of our independent directors with five or more years of services were in compliance with the guidelines. Messrs. Africk and Peiser were appointed asEach of our independent directors effective March 7, 2016,with less than five years of service (Mr. Anton, Mr. Della Ratta, Mr. Lewis and Ms. Landahl was appointed as an independent director effective September 1, 2017. Each of Messrs. Africk and Peiser and Ms. LandahlMr. Mikhalevsky) will have five years from their respective appointments to the Board in which to meet their respective stock ownership goals.
The following table below sets forth the compensation for ourpaid by SunCoke Energy, Inc. to its independent directors in fiscal 2017:2023. Mr. Rippey and Ms. Gates are employee directors and do not receive separate compensation for their Board service.
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 | 170,000 | 120,000 | 290,000 | |||||||||||||||||||||||||
Martha Z. Carnes | 115,000 | 120,000 | 235,000 | |||||||||||||||||||||||||
Ralph M. Della Ratta, Jr. | 115,000 | 120,000 | 235,000 | |||||||||||||||||||||||||
Susan R. Landahl | 102,000 | 120,000 | 222,000 | |||||||||||||||||||||||||
Michael W. Lewis | 100,000 | 120,000 | 220,000 | |||||||||||||||||||||||||
Andrei A. Mikhalevsky (3) | 75,000 | 100,000 | 175,000 | |||||||||||||||||||||||||
| (1) | The amounts in this column |
| (2) | The amounts in this column represent the grant date fair value of the stock retainer payments paid to each director in fiscal |
| (3) |
|
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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 |
| Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information |
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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, 2017.2023.
Members of the Compensation Committee:
 |  |  |  | |||
| Ralph M. Della Ratta, Jr. (Chair) | Arthur F. Anton | Susan R. Landahl | Andrei A. Mikhalevsky | |||
Robert A. Peiser (Chair)
James E. Sweetnam
Andrew D. Africk
Compensation Discussion and Analysis (“CD&A”)
The followingThis CD&A describes the material elements of the 20172023 compensation and benefit programs for our named executive officers, or NEOs. OurFor 2023, our NEOs for 2017, which consist of those executive officers who appear in the Summary Compensation Table, were:
 |
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 |
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Michael G. Rippey, Chief Executive Officer | ||||||||
Katherine T. Gates, President(1) |
Senior Vice President and Chief Financial |
P. Michael Hardesty, Senior Vice President Commercial Operations, Business Development, Terminals and International |
Vice President, |
|
The CD&A is organized into sixfive 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 5 -- PAY MIX, OPPORTUNITY AND LEVERAGE
SECTION 6 -- OTHER COMPENSATION INFORMATION
SECTION 1 -- EXECUTIVE SUMMARY
2017 was a year of improvement for SunCoke in an environment that saw gradual improvement in the steel and coal markets. Adjusted EBITDA for 2017 was $234.7 million, an 8% improvement over 2016 and at 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 domestic coke making operations produced operating results in line with expectations. The impacts associated with our continued Indiana Harbor oven rebuild campaign offset benefits from the remainder of our domestic 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, broadening our customer base and leveraging this strategically positioned asset.
The following chart illustrates our historical earnings, cash generation and Total Shareholder Return (TSR).
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 measures 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.
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.
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.
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.
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.
The Company regularly engages with its largest, actively managed shareholders on many issues, including executive compensation. In March of 2016, we added two new Directors, who were recommended by our two largest shareholders at that time, to our Compensation Committee, including the Chair of the Compensation Committee. Feedback from shareholders and the new Directors was considered in a number 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 restructuring 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 structure and actions for the following reasons:
| SECTION 1 — EXECUTIVE SUMMARY |
| 22 | ||
| SECTION 2 — OUR COMPENSATION PHILOSOPHY | 24 | |||
| SECTION 3 — ROLE OF MANAGEMENT, COMPENSATION CONSULTANTS AND MARKET DATA | 25 | |||
| SECTION 4 — ELEMENTS OF COMPENSATION: PAY MIX, OPPORTUNITY AND LEVERAGE | 28 | |||
| SECTION 5 — OTHER COMPENSATION INFORMATION | 34 | |||
| 1 |
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SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 21
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
SECTION 1 — EXECUTIVE SUMMARY
Following record-setting Adjusted EBITDA (1) performance in 2022, the Company delivered solid financial performance in 2023 with strong domestic coke operational performance, coupled with headwinds in our Logistics segment. We further built upon our success in foundry coke by completing the foundry coke expansion project and expanding our market participation. The project improves handling efficiency of foundry coke while maintaining flexibility for the Jewell plant to shift between blast and foundry coke production. Our strategy to diversify our product and customer bases by producing and selling foundry coke and non-contracted blast furnace coke in the spot market has further established SunCoke as a supplier of high-quality products. We have developed strong customer relationships due to our reliable production, excellent quality, and operational and technical expertise. SunCoke’s reputation in the marketplace was additionally affirmed by the extension of our largest cokemaking contract with Cleveland-Cliffs, Inc. through September 2035, which positions our Indiana Harbor plant well for the future. Participation in the foundry and spot coke markets, and successful execution on our contracted coke sales, supported our Domestic Coke facilities in running at full capacity and selling out.
Our long-term, take-or-pay coke contracts continue to provide stability to our coke operations, with strong operational performance driving our results in 2023. We were able to successfully sell all non-contracted coke tons into the foundry and spot coke markets during the year. These factors resulted in consolidated Adjusted EBITDA of $268.8 million, exceeding the high end of our guidance range of $250million to $265 million. Additionally, we generated $249.0 million in operating cash flow, exceeding our guidance range of $200 million to $215 million.
Following strong performance from our Logistics segment in 2022 and 2021, we experienced weaker market conditions at the Company’s Convent Marine Terminal (“CMT”) in Louisiana during the second half of 2023. Tepid thermal coal demand in Europe due to milder weather and low-cost gas imports impacted the volume and price of thermal coal handled at CMT.
We made great progress on our capital allocation priorities in 2023, focusing on further strengthening the balance sheet by lowering our gross debt by $43.8 million. We returned approximately $31 million of capital to shareholders, having increased our quarterly dividend from $0.08 per share to $0.10 per share during the year, representing a 25 percent increase. Additionally, we continued to work on developing the granulated pig iron (GPI) project at our Granite City plant.
Safety is our first priority, and our 2023 performance, when measured against steel and coke industry-wide rates, continued to be better than those benchmarks. Moreover, we set our safety target, for the purposes of our annual incentive plan, significantly better than industry benchmarks. To that end, our safety record is best understood in comparison to industry-wide safety performance. Our Total Recordable Incident Rate (“TRIR”) was 0.99 for 2023. For comparison, the Bureau of Labor Statistics reported the overall TRIR for Petroleum and Coal (Coke) Products Manufacturing as 3.1, and the TRIR for the Iron and Steel Mills Sector as 2.2. (2)
Environmental performance has always been central to our operations, and the Company continues to utilize actual, measurable environmental performance for our compensation program — as it has done since the Company’s inception. Our 2023 performance was excellent, achieving the maximum metrics and continuing our consistent, strong results from prior years.
| (1) |
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| (2) | TRIR is described in greater detail in the Rationale and |
SECTION 2 -- OUR COMPENSATION PHILOSOPHY
22 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
2023 PERFORMANCE HIGHLIGHTS
Our executive team and employees continued to focus on the Company’s long-term success by pursuing the diversification of our customer and product bases while preserving contracted capacity. We made progress on these objectives by completing the foundry coke expansion project to help further broaden our participation in the foundry coke market, continuing to work on the GPI project at Granite City, and extending our Indiana Harbor cokemaking contract with our customer through September 2035. We further strengthened our capital structure by lowering gross debt by $43.8 million and returned capital to shareholders with a quarterly dividend that increased from $0.08/share to $0.10/share. The foundation for these accomplishments is first-rate, consistent operational execution, including strong safety and environmental performance.
Here is a summary of our major accomplishments during 2023:
Delivered solid financial performance | • Achieved consolidated Adjusted EBITDA of $268.8 million • Exceeded high end of guidance ($265 million) due to strong Domestic Coke operational performance while navigating challenging market conditions in the Logistics segment • Generated $249.0 million of operating cash flow | |
Supported full cokemaking capacity utilization via spot/foundry sales and long-term, take-or-pay contract extension | • Our domestic coke fleet operated at full capacity • Continued to build on success in foundry by completing the foundry coke expansion project and broadening market participation • Successfully executed on our contracted coke sales • Extended our Indiana Harbor contract with Cleveland-Cliffs for an additional 12 years, with key provisions similar to the previous agreement | |
Executed on well-established capital allocation priorities | • Lowered gross debt by $43.8 million, with a gross leverage ratio of 1.86x at year-end, on a last twelve months Adjusted EBITDA basis • Returned $30.7 million of capital to shareholders via our quarterly dividend, which increased by 25% during 2023; we anticipate the dividend to continue in 2024 • Continued working with U.S. Steel on the Granite City GPI project | |
Demonstrated strong commitment to safety and environmental | • Continued to deliver strong safety and operational excellence, with safety performance that is consistently better than industry-wide rates • Demonstrated rigorous environmental compliance and contributed to lower carbon steelmaking by providing high-quality, high strength coke that lowers need for carbon-intensive fuels in the blast furnace | |
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 23
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Historical Financial Performance
Following record Adjusted EBITDA performance in 2022, the Company delivered solid financial performance in 2023 with strong domestic coke operational performance, coupled with headwinds in our Logistics segment. This financial and operating performance is not unusual, as we have met or exceeded our guidance in each of the last eight years. Despite this consistent performance, SunCoke’s stock price does experience volatility caused primarily by steel industry outlook factors. Because our stock price is highly correlated with that of our customers, the steel industry outlook and our customer’s performance can create a disconnect between the Company’s operating results and stock price.
Shareholder Engagement
The principlesCompany values feedback from all of our stockholders and regularly engages with them at conferences and individually. We believe this approach to engaging proactively and openly drives increased accountability, well-rounded decision-making, and ultimately furthers creation of long-term value. During 2023, we engaged with 36 investors via audiovisual and in-person conferences. In addition, the Company’s Chief Executive Officer, President and others regularly engage in dialogue with stockholders through the Company’s quarterly earnings calls.
The Company received no recommendations on executive compensation from stockholders in 2023. In addition, our “Say on Pay” vote in 2023 received 93.5% support from stockholders. The Company’s Board and Compensation Committee reviewed the results of this vote and concluded that this level of approval reflects strong shareholder support of our compensation strategy are tied to increasing stockholder value overand programs. In light of this approval, the long-term and are as follows:structure of our pay programs has remained materially consistent from 2019 through 2023.
SECTION 2 — OUR COMPENSATION PHILOSOPHY
Our Compensation Program is Designed Around These Guiding Principles:
| Strong pay for performance orientation | • A significant portion of our NEOs’ pay is at risk based on financial, operational and share performance. • The level of pay at risk increases progressively at positions of greater responsibility. | ||
 | Align Pay with Long-Term Interests of our Stockholders | • Our incentive compensation is linked to the achievement of performance and share metrics which drive shareholder value, thereby aligning to pay for performance and increasing stockholders’ value over the long-term. | ||
| Attract, Reward & Retain Executives | • Our compensation structure serves to attract and retain top-level executive talent. | ||
 | Provide Competitive Compensation | • 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. | ||
 | Avoid Legacy Liabilities | • We provide competitive benefits in a manner that emphasizes flexibility and avoidance of legacy liabilities. • For example, our NEOs have no defined benefit pension plan or retiree medical plan. | ||
24 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Compensation Governance Practices
We have a robust and ongoing annual process to plan, review and determine executive compensation, which includes engagement with our stockholders. Our compensation structure has a strongprogram is designed to promote exceptional performance orientation, with a significant portion of pay at risk based on 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 shareholders’ interests, and leadership will be rewarded whenalign the interests of our executives with the interests of our stockholders are advanced.
The compensation structure supports our need to attract and retain top level talent, individuals with critical skills and top performers.
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:while discouraging executives from taking excessive risks.
| ✔ What We Do: | × What We Don’t Do: | |||
✔ Require a “double trigger” for payment of change in control cash severance ✔ Require significant stock ownership of executive officers ✔ Provide for clawback of incentive awards if our financial statements are restated ✔ Annually review risks associated with our compensation programs
| ||||
×
×Nore-pricing or cash buyout ofout-of-the-money stock options
× No guaranteed minimum payout of annual or long-term performance awards × No individual employment contracts or individual change
×No × No dividends or dividend equivalents on unearned RSUs or performance shares × No perquisites, other than partial commuting allowances in | ||||
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 consideringagainst 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,NEOs and makes recommendations to the Compensation Committee with respect to their compensation, including salary and annual cash incentive opportunities and grants of long-term incentive awards. Theincentives.
After considering the data on market-based compensation provided by the Company’s independent compensation consultant, the Compensation Committee annually reviews and determinesassesses the compensation of these executivesour NEOs. In so doing, the Compensation Committee also considers, among other things, the Company’s results of operations, relative shareholder return, other performance metrics, and the value of similar compensation for NEOs at comparable companies.
Based upon this review, the Compensation Committee presents its recommendations for approval to the full Board and, after considering the CEO’s input andCompensation Committee’s recommendations, and its own judgmentthe Board determines the appropriate levels of each executive’s performance duringcompensation for the period.NEOs. 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
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 25
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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,Meridian served as our independent compensation consultant in 2023, having been retained by the Compensation Committee has retained Compensation Advisory Partners, or CAP, an independent compensation consulting firm,in September 2021 to provide advice on executive compensation matters. Pursuant to the NYSE listing standards, theThe Compensation Committee regularly reviews the consultant’s independence relative to key factors including: (i) whetheridentified in the consultant provides any other services to the Company; (ii) the amount of fees paid relative to the total revenueapplicable listing standards 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.NYSE. Based on its assessment, the Compensation Committee concluded that CAPMeridian is independent and that no conflicts of interest exist.
CAPMeridian provides advice on emerging trends, competitive pay levels and regulatory developments as they relateand data related to executive compensation. CAP’sMeridian’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. CAPCD&A. Meridian 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 informationnational market survey data from national surveys conducted by Willis Towers Watson and Mercer. During 2017, the SunCoke Energy surveyEquilar. For Willis Towers Watson, this data was a blend of general industry survey data for companies with revenues of between $1 billion and $3 billion.
billion, while the data for Equilar was for companies with revenues between $1 billion to $5 billion (“General Industry Survey Data”). To supplement the survey data, when making compensation decisions for 2017, management recommended and the Compensation Committee approvedconsidered compensation data derived from 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 peer15 companies and also considering feedback from our largest shareholder. Unlike many companies, the(the “Peer Group”).
The nature of SunCoke’s long-termtake-or-pay coke contracts, which pass through commodity and certain operating costs to customers, makes revenue a less relevant.meaningful criteria for purposes of selecting peer companies. 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, theEBITDA. The Compensation Committee also considers other financial metrics, including market capitalization, enterprise value and revenueas appropriate, in making the final determination of peer companies. As a result of this review, the below changes were made to the 2016Market capitalization and enterprise value are used as reference measures when considering peer group.companies but these measures are volatile, especially in our industry.
26 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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The approved 2017 compensation peer group includedfor fiscal year 2023 was comprised of 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 | ||||||
| (millions) | (millions) | (millions) | (millions) | (millions) | ||||||||
AK Steel Holding Corporation | $533 | $1,390 | $6,081 | $1,782 | $4,164 | 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 | ||||||
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75th Percentile | $355 | $887 | $2,238 | $2,423 | $3,575 | |||||||
Median (n=18) | $235 | $550 | $1,577 | $1,880 | $2,799 | |||||||
25th Percentile | $163 | $366 | $1,242 | $1,124 | $1,725 | |||||||
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SunCoke Energy, Inc.** | $235 | $625 | $1,332 | $1,100 | $1,839 | Steel | ||||||
Percent Rank | 50% | 57% | 29% | 24% | 31% |
Company | 1-Year EBITDA (millions) | 3-Year EBITDA (millions) | 1-Year Revenue (millions) | Market Cap. at 12/31/23 (millions) | Enterprise Value at 12/31/23 (millions) | Primary Industry | ||||||||||||||||
Eagle Materials Inc. | $ | 724 | $ | 1,814 | $ | 2,148 | $ | 7,076 | $ | 8,150 | Construction Materials | |||||||||||
Warrior Met Coal, Inc. | $ | 681 | $ | 2,035 | $ | 1,677 | $ | 3,172 | $ | 2,652 | Steel | |||||||||||
Cabot Corporation | $ | 673 | $ | 1,971 | $ | 3,931 | $ | 4,618 | $ | 5,898 | Commodity Chemicals | |||||||||||
ATI Inc. | $ | 537 | $ | 1,708 | $ | 4,174 | $ | 5,801 | $ | 7,669 | Steel | |||||||||||
Minerals Technologies Inc. | $ | 375 | $ | 1,057 | $ | 2,170 | $ | 2,321 | $ | 3,118 | Specialty Chemicals | |||||||||||
Worthington Industries, Inc. (1) | $ | 347 | $ | 1,137 | $ | 4,916 | N/A | N/A | Steel | |||||||||||||
Quaker Chemical Corporation | $ | 302 | $ | 805 | $ | 1,953 | $ | 3,838 | $ | 4,499 | Specialty Chemicals | |||||||||||
Enviri Corporation (2) | $ | 275 | $ | 776 | $ | 2,069 | $ | 719 | $ | 2,199 | Environmental and Facilities Services | |||||||||||
Koppers Holdings Inc. | $ | 250 | $ | 627 | $ | 2,154 | $ | 1,067 | $ | 1,961 | Commodity Chemicals | |||||||||||
Carpenter Technology Corporation | $ | 238 | $ | 343 | $ | 2,550 | $ | 3,491 | $ | 4,175 | Steel | |||||||||||
Materion Corporation | $ | 203 | $ | 506 | $ | 1,665 | $ | 2,686 | $ | 3,193 | Diversified Metals and Mining | |||||||||||
Kaiser Aluminum Corporation | $ | 201 | $ | 484 | $ | 3,087 | $ | 1,132 | $ | 2,168 | Aluminum | |||||||||||
Ferro Corporation (3) | $ | 199 | $ | 446 | $ | 1,126 | N/A | N/A | Specialty Chemicals | |||||||||||||
Metallus Inc. (4) | $ | 159 | $ | 587 | $ | 1,362 | $ | 1,012 | $ | 811 | Steel | |||||||||||
Radius Recycling, Inc. (5) | $ | 105 | $ | 649 | $ | 2,882 | $ | 840 | $ | 1,203 | Steel | |||||||||||
75th Percentile | $ | 450 | $ | 1,417 | $ | 2,985 | $ | 3,838 | $ | 4,499 | ||||||||||||
Median (n=15) | $ | 269 | $ | 770 | $ | 2,154 | $ | 2,686 | $ | 3,118 | ||||||||||||
25th Percentile | $ | 202 | $ | 529 | $ | 1,815 | $ | 1,067 | $ | 2,168 | ||||||||||||
SunCoke Energy, Inc. | $ | 268 | $ | 838 | $ | 2,063 | $ | 900 | $ | 1,303 | Steel | |||||||||||
+/- Median | 0 | % | 9 | % | -4 | % | -67 | % | -58 | % | ||||||||||||
Percentile Rank vs. Peers | 50 | % | 58 | % | 35 | % | 11 | % | 9 | % | ||||||||||||
Source: S&P Capital IQ Database
Notes: CompaniesPeer companies are sorted in descending order based on 1-YearEBITDA.
Source for peer data: S&P Capital IQ Database (as of 3/5/2024); Revenue and EBITDA calculated for the most recent fiscal year, while market cap and enterprise value are shown as of 12/31/2023.
Notes:
| 1. |
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| 2. |
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Based on 2017 EBITDA, SunCoke was positioned at
| 3. | Ferro Corporation was acquired by Prince International Corporation on April 21, 2022; trailing 1-year and 3-year figures reflect most recently reported data prior to acquisition. |
| 4. | Formerly known as TimkenSteel Corporation. |
| 5. | Formerly known as Schnitzer Steel Industries. |
On September 6, 2023, the 50th percentile ofCompensation Committee approved a new compensation peer group for fiscal year 2024, removing Ferro Corporation from the peer group.foregoing list, and adding Summit Materials, Inc., and Ingevity Corporation as peers.
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 27
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
SECTION 5 --4 — ELEMENTS OF COMPENSATION: PAY MIX, OPPORTUNITY AND LEVERAGE
The total direct compensation opportunity for each NEO in 20172023 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 retainedretains 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.
These percentages are based on each current NEO’s salary and annual and long-term incentive targets atyear-end 2017.for 2023.
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. The Compensation Committee approved a merit-based increase of 5% for Mr. Rippey’s base salary to recognize his leadership in 2023, including increased participation in the foundry coke market, execution of spot blast coke sales, full utilization of our Domestic Coke plants, and the extension of the Indiana Harbor contract. This increase aligned his base salary closer to the peer group median. This increase, along with 5% increases for Mr. Hardesty and Mr. Quanci, were approved in February 2023. The Compensation Committee approved the increase in Ms. Gates’ base salary to reflect her promotion to the role of President in January 2023 and to align her base salary with comparable peer group data. Mr. Marinko joined the Company in March, 2022 and his compensation was approved at that time.
| Named Executive Officer | 2023 Annual Base Salary ($) | 2022 Annual Base Salary ($) | Percentage Increase (%) | |||||
Mr. Rippey | 1,030,399 | 981,332 | 5.0 | |||||
Ms. Gates(1) | 661,500 | 477,405 | 38.6 | |||||
Mr. Marinko | 470,000 | 470,000 | 0.0 | |||||
Mr. Hardesty | 481,893 | 458,945 | 5.0 | |||||
Mr. Quanci | 426,297 | 405,997 | 5.0 | |||||
28 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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Leadership Succession
As part of a strategic, deliberate and well-executed long-term succession planning process, the Company’s Board of Directors appointed Katherine T. Gates to become President and CEO, effective as of May 15, 2024, following Michael G. Rippey’s planned retirement on that same date. To provide for the orderly transition of his duties as CEO, Mr. Rippey will enter into an Advisory Agreement with the Company, pursuant to which he will act in the non-executive officer role of strategic advisor. As President and CEO, Ms. Gates will receive an annual base salary of $900,000 and will be eligible to receive an annual cash incentive plan award with a target percentage of 100% of her base salary. In addition, Ms. Gates will receive annual equity compensation awards as determined by the Compensation Committee.
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 detailed below, as well as individual performance. An executive’s annual incentive payment,The payout if any, may not exceed 200% of his or hera NEO’s target incentive opportunity and is determined by the following formula:opportunity.
Payout = Base Salary x Target Incentive Opportunity x Company Payout Factor x Individual Performance Factor
Target Incentive Opportunity:Each executive has a target incentive opportunity that is expressed as a percentage of annual salary. The 2017Effective January 1, 2023, the Compensation Committee approved a market-based increase of 5% for Ms. Gates’ target incentives forcash incentive to align her compensation with the peer group median, in connection with her promotion to the position of President. For 2023, 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, andNEO’s target incentive opportunities 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 | ||||||
Mr. Henderson | $ | 850,000 | 125 | % | ||||
Ms. West | $ | 460,000 | 120 | % | ||||
Mr. Hardesty | $ | 380,000 | 105 | % | ||||
Ms. Gates | $ | 380,000 | 85 | % | ||||
Mr. Yeaw | $ | 375,000 | 75 | % | ||||
| Named Executive Officer | Annual Base Salary ($) | Target Incentive as % of Salary | ||
Mr. Rippey | 1,030,399 | 110 | ||
Ms. Gates | 661,500 | 80 | ||
Mr. Marinko | 470,000 | 75 | ||
Mr. Hardesty | 481,893 | 75 | ||
Mr. Quanci | 426,297 | 70 | ||
For 2017,2023, the AIP used the following corporate performance goals:measures and weighting, which are unchanged from 2022:
Metric | Weighting | Rationale and Definition | |||
Adjusted Earnings before Interest, Taxes, Depreciation and Amortization | 70% | Adjusted EBITDA was selected as the primary measure since
As defined in Item
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. | |||
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| Metric | Weighting | Rationale and Definition | ||
Safety Performance | 10% | Safety performance consists of anall-company target (Coke, Corporate and Logistics), which is measured using the regulatory | ||
Environmental Performance | 10% | Environmental performance is determined by a comprehensive assessment of (i) venting levels relative to each plant’s operating
| ||
The following table sets forth the quantitative performance goals for 2017 and the approved performance result as a percentage of target. TheAIP 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.challenges. 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% achievement, is set at a level which would representthat represents extraordinary performance.
The 100% achievement factor for financial and operational 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%) achievement factors represent 80% and 120%110% 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 availablean internal target set each year, which is based on internal performance and external metrics, with an expectation of continuous improvement,benchmarks. The environmental metric is based on permit compliance, including air emissions and each has a maximum payout 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.
In approving the final payout of the 2017 Annual Incentive, the Compensation Committee in its discretion considers potential adjustments to the results. These adjustments, which can be positive or negative, may include unbudgeted initiatives which will have a benefit in future periods, or are deemed in the best interests of shareholders,deviations, as well as items which were unplanned and uncontrollable. The net effect of the 2017 adjustments increased the approved Company payout by 3.1%. Details on the adjustments follow.
In calculating the approved performance for Operating Cash Flow, the Compensation Committee adjusted Operating Cash Flow for the effect ofother factors important to the Company’s refinancing activities, specifically, the additional interest payment resulting from the timing of the refinancing activities. environmental results.
The adjustmentCompany’s payout curve is designed to Operating Cash Flow was $10.9 million.
During 2017 the Company initiated discussionsincentivize executives to purchase the outstanding units of SunCoke Energy Partners, L.P. While management and the Board of Directors continuefind every opportunity, no matter how small, 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 theincrease Adjusted EBITDA, without sacrificing safety or environmental performance. SunCoke typically sets guidance within a $10 million to $15 million range, so increases of even $2 million of Adjusted EBITDA should be encouraged and Operating Cash Flow calculations.recognized.
AIP Compensation Decisions and Results:With respect to each performance measure, the table below shows the weighting, quantitative performance goals (at threshold, target and maximum) and actual performance. In addition, the table shows the weighted percentage of target incentive opportunity earned for each performance measure, and the total percentage of target incentive opportunity earned for 2023.
Metric | Weighting | Performance Goals (in millions) | Actual Performance | Weighted % of Target Incentive Opportunity | ||||||||||||||||||||||||||
| Threshold | Target | Maximum | ||||||||||||||||||||||||||||
| 25% of target | 200% of target | |||||||||||||||||||||||||||||
Adjusted EBITDA ($MM) | 70 | % | $ | 206.00 | $ | 257.50 | $ | 283.30 | $ | 266.20 | 93.62 | % | ||||||||||||||||||
Operating Cash Flow ($MM) | 10 | % | $ | 138.50 | $ | 190.00 | $ | 215.50 | $ | 249.00 | 20.00 | % | ||||||||||||||||||
Safety Performance | 10 | % | 1.1 | 0.8 | 0.3 | 0.99 | 5.25 | % | ||||||||||||||||||||||
Environmental Performance | 10 | % | Comprehensive Assessment | 145 | % | 14.50 | % | |||||||||||||||||||||||
Aggregate % of Target Incentive Opportunity Earned | 133.37 | % | ||||||||||||||||||||||||||||
The Compensation Committee also excluded from Adjusted EBITDA the positive impact of a decrease inexpenses related to our Black Lung reserves from legacy operations of $0.5$2.5 million in Adjusted EBITDA.below budgeted results. This is consistent with the treatmentexclusion of Black Lung reserve changes in prior years.
30 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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In determining the 2023 AIP Payout, the Committee also considered:
The Company’s 2023 financial results, with Operating Cash Flow and Adjusted EBITDA exceeding guidance.
Recognition of the Company’s advancement as a supplier of high-quality products to a more diverse customer base.
Strong Domestic Coke performance, including successful execution of contracted coke sales, as well as participation in the foundry coke market and spot market for blast furnace coke.
Strengthening of the balance sheet with further reduction in gross debt by approximately $43.8 million.
SunCoke’s safety performance, with a TRIR of 0.99, is meaningfully stronger when compared to our industry benchmarks.
Exceptional environmental performance through maximizing our objective metrics coupled with achieving difficult goals for environmental matters.
After considering the foregoing notable achievements and performance of the management team, the Committee did not exercise its discretion to adjust the formulaic payout percentage of 133.37%. The Committee considers this payout level to be reasonable to recognize performance and aligned with enterprise and stockholder interests. The table below shows the 2023 AIP bonus amounts that were paid to each NEO:
Named Executive Officer | Target Award ($) | Actual Award ($) | ||||||
Mr. Rippey | 1,133,439 | 1,511,668 | ||||||
Ms. Gates | 529,200 | 705,794 | ||||||
Mr. Marinko | 352,500 | 470,129 | ||||||
Mr. Hardesty | 361,420 | 482,025 | ||||||
Mr. Quanci | 298,408 | 397,987 | ||||||
For our 2024 AIP targets, we will follow our typical process and establish goals based on our business plan and guidance to stockholders. The plan reflects the expected earnings and cash flow based on (a) the terms of our contracts, (b) foundry, and/or spot blast furnace coke sales, and (c) volumes and pricing for our logistics segment. The rigorous metrics for Safety and Environmental performance will continue.
Long-Term Incentives
Each year, the Compensation Committee reviews the Peer Group and General Industry survey data regarding the typical mix of short and long-term incentive awards. Based upon the NEO’s position, Peer Group practices and our compensation philosophy, the Compensation Committee determines each NEO’s target long-term incentive compensation (expressed as a percentage of base salary) and the allocation of target long-term incentive compensation among a mix of long-term incentive awards. For 2023, long-term incentive awards granted to our NEOs included performance share units, restricted share units, and long-term cash awards.
Long-Term Equity Incentive Awards
Equity awards are designed to align our NEOs’ compensation with the interests of stockholders by providing: (1) a direct link between the NEOs’ incentive pay and stockholders’ gains, (2) management with the ability to increase equity ownership in the Company, (3) competitive compensation opportunities that can be realized through attainment of key performance goals and (4) an incentive that will attract and retain executives. There are two elements to our 2023 equity incentive program:
| • | Restricted Share Units: Restricted share units, or RSUs, represent rights to receive shares of our 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. |
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| • | Performance Share Units: Performance share units, or PSUs, represent rights to receive shares of our Common Stock, with vesting conditioned upon the attainment of performance goals established by the Compensation Committee for the applicable performance period, as well as the participant’s continued employment with the Company. |
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 stockholders. Our core business, the production of metallurgical coke, is a capital-intensive business with primarily take-or-pay contracts with integrated steel producers. Our revenue is largely determined by coal prices, where we are generally not at risk based on the structure of our take-or-pay coke contracts. Therefore, the Compensation Committee determined that the two most important drivers of long-term performance are cumulative Adjusted EBITDA and pre-tax Return on Invested 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 used 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.
2023-2025 PSU Award
The 2023-2025 PSU awards may be earned over the three-year performance period ending on December 31, 2025. Each NEO may earn between zero percent and 200% of his or her target 2023-2025 PSU grant based on achieved performance against pre-determined performance goals, which are shown in the below table:
Metric | Threshold 25% | Target 100% | Maximum 200% | ||||||||||||
Cumulative Adjusted EBITDA (weighted 50%) | $ | 624.4M | $ | 780.5M | $ | 835.2M | |||||||||
Average Pre-Tax ROIC (Coke, Logistics & Unallocated Corporate) | 11.5% | 14.4% | 15.4% | ||||||||||||
Adjusted EBITDA is an important measure in assessing operating performance. Our management, as well as certain investors, uses this measure to analyze our current and expected future financial performance. Adjusted EBITDA provides useful information to investors because it highlights trends in our business that may not otherwise be apparent when relying solely on other measures and because it eliminates items that have less bearing on our operating performance.
Our long-term goals on Adjusted EBITDA and pre-tax ROIC are determined based on our contracts and capital investment. For our domestic coke segment, Adjusted EBITDA is based on running our coke plants at full capacity and selling all of our coke. We set spot coke pricing based on what we know about market conditions, which fluctuate and in turn will affect that amount of EBITDA we make. The logistics business Adjusted EBITDA is primarily driven by seaborne export market dynamics including the global demand of coal and commodity pricing. We set 2023 through 2025 financial targets based on these assumptions along with the aim to be aggressive and require continuous improvement in operations.
PSUs are subject to a modifier that can increase or decrease the PSU payout by a multiplier of +/- 20% based on the Company’s Adjusted EBITDA, cash flow and operationalTotal Shareholder Return (“TSR”) performance as well asover the executive team’s actionsthree-year performance period. The Company’s TSR is ranked relative to reduce costs,de-leverthe balance sheet and supportTSR of each company that is part of the transition in CEO,NASDAQ Iron & Steel Index over the same period on a non-weighted basis. Performance between threshold, target or maximum levels will be determined by straight-line interpolation. The payout is capped at 240% (including the TSR modifier) of the target units. The Compensation Committee approved an individualdetermines the level of achievement of the goals after the end of the performance factor of 100% for each NEO (no upward or downward individual adjustment). The total bonus amounts paid to each NEO for 2017 were:period.
NEO | 2017 Target AIP Amount | 2017 AIP Payout Amount | ||||||
Mr. Henderson | $ | 1,062,500 | $ | 1,074,187 | ||||
Ms. West | $ | 552,000 | $ | 558,072 | ||||
Mr. Hardesty | $ | 399,000 | $ | 403,389 | ||||
Ms. Gates | $ | 323,000 | $ | 326,553 | ||||
Mr. Yeaw | $ | 281,250 | $ | 284,344 | ||||
Senior Executive Incentive Plan2021-2023 PSU Award
The AIP works in conjunction withthree-year performance period for PSUs granted under the Senior Executive IncentiveSunCoke Energy, Inc. Long-Term Performance Enhancement Plan, or SEIP, which acts as an overlay toLTPEP, in 2021, ended on December 31, 2023. The LTPEP was a former equity plan that was replaced by the AIP and sets a performance-based ceiling on the bonuses paid under the AIP, so that they meet the deductibility requirements of Section 162(m) of the Internal Revenue Code. For 2017, the SEIP coveredOmnibus Plan in May 2022. Mr. Henderson, Mr. Hardesty,Rippey, Ms. Gates and Mr. Yeaw. (CFOs were not subject to Section 162(m) in 2017). WithHardesty received a payout under these PSUs. The payout for the PSUs was based on achievement against three-year cumulative Adjusted EBITDA asperformance goals (weighted 50%), and on achievement against three year average pre-tax ROIC for the Coke and Logistics businesses plus unallocated corporate income performance metric,goals (weighted 50%).
32 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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In addition, the Compensation Committee establishedPSUs granted in 2021 contained a bonus pool undermodifier that can increase or decrease the SEIP equalPSU payout by a multiplier of +/- 25% based on the Company’s TSR performance over the three-year performance period. The Company’s TSR is ranked relative to 5%the TSR of Adjusted EBITDA, with each participant being allocated a maximum allowable percentcompany that is part of the funded pool. OnceNASDAQ Iron & Steel Index over the pool is funded,same period on a non-weighted basis. If SunCoke achieved maximum performance levels on all metrics and the Committee utilizesmodifier, the criteriapayout would be capped at 250% of the target.
Based upon performance as shown in the AIP to determinefollowing table, 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.NEOs received 216.70% of their target PSU grant and accumulated dividends.
SunCoke 2021 – 2023 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% | 519.0 | 649.0 | 694.0 | 841.9 | 200.0% | ||||||||||||||
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SunCoke 2021 – 2023 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% | 7.3% | 9.2% | 9.8% | 13.7% | 200.0% | ||||||||||||||
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SunCoke 2021 – 2023 TSR Modifier and Final PSU Award Payout | ||||||||||||||||||||
At the end of the three-year performance period (December 31, 2023), 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 2021 - 2023 period, the TSR modifier was 1.083%. | Payout Pre- TSR Modifier (.5 x 200.0%) | 200.0% | ||||||||||||||||||
| TSR Modifier | 1.08% | |||||||||||||||||||
| Final PSU Award Payout |
|
216.7% |
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2023-2025 Long-Term Performance Enhancement Plan (LTPEP)Cash Incentive Awards
EquityThe 2023-2025 long-term performance cash incentive awards under the LTPEP are designed to align the executives’ compensation with the interests of shareholdersstockholders by creating a direct linkage between the executives’ rewards and shareholders’ gains, provide management with the ability to increase equity ownership in SunCoke Energy, provideproviding competitive compensation opportunities that can be realized through attainment of performance goals and provide an incentive to attract and retain executives. ThereAwards are four 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 Options. Performance stock options are a form of compensation that allows the executive to purchase SunCoke Energy common stock at a fixed price (typically the closing price on 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 order for the option to be exercisable.
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 Units. Performance share units, or PSUs, represent rights to receive shares of Company common stock,granted with vesting conditioned upon the attainment of performance goals established by the Compensation Committee for the applicable performance period, as well as the participant’s continued employment with SunCoke.
The 2023-2025 long-term performance cash incentive awards may be earned over the three-year performance period ending on December 31, 2025. Each year, the Compensation Committee evaluates the appropriate compensation mixNEO may earn between zero percent and reviews the Peer Group data and General Industry survey data regarding the typical mix200% of medium- 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 thehis or her target long-term incentive compensation as a percentage of base salary.
The Compensation Committee determines the performance metrics for the long-termcash incentive awards based on achieved performance against pre-determined performance goals, which are shown in the financial measures most relevant to the Company’s performancebelow table:
Metric | Threshold 0% | Target 100% | Maximum 200% | |||||||||
Cumulative Adjusted EBITDA (weighted 50%) | $ | 624.40M | $ | 780.50M | $ | 835.20M | ||||||
Average Pre-Tax ROIC (Coke, Logistics & Unallocated Corporate) (weighted 50%) | 11.50% | 14.40% | 15.40% | |||||||||
Our long-term goals on Adjusted EBITDA and generation of long-term value for shareholders. SunCoke’s largest business, the production of metallurgical coke, is a capital-intensive business with long-term “take or pay” contracts with 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 largelypre-tax ROIC are determined by coal prices for which we are not at risk based on the structure of our take or pay contracts. Therefore, the Compensation Committee determinedcontracts and capital investment. We set goals that the two most important drivers ofare aggressive and require continuous improvement in operations. In addition, our long-term performance are cumulative Adjusted EBITDA andpre-tax Return on Invested Capital. A TSR modifier is also part of the metrics in order to partially adjust the award value to reflect shareholder return, regardless of the underlying generation of Adjusted EBITDA or ROIC.
Our long-termcash incentive awards are subject to other terms and conditions set forth in the applicable award agreements. In February 2017, the Compensation Committee made equity awards to the NEOs. For Mr. Henderson, the allocation was 10% 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.
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.
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2021-2023 Long-Term Cash Incentive Award
The PSU grants have a three-year performance period beginning on January 1, 2017 and endingfor the long-term cash incentive awards granted in 2021 under the LTPEP ended on December 31, 2019. The two primary2023. Each of our NEOs received a payout under these long-term cash incentive awards, based on achievement against three-year cumulative Adjusted EBITDA performance metrics, which are each weightedgoals (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% |
Theon achievement against three year average pre-tax ROIC target was set lower than 2016 targets due to forecasted changes in operatingfor the Coke and Logistics businesses plus unallocated corporate income primarily driven by lower production at Indiana Harbor and increased depreciation expense from an increased number of planned Indiana Harbor oven rebuilds in 2017.
In addition,performance goals (weighted 50%). Unlike the award containsPSUs, these long-term cash incentive grants do not contain a modifier whichthat can increase or decrease the award payout by up to 50% based on the Company’s Total Shareholder Return (TSR) performance over the three-year performance period relative to the NASDAQ Iron & Steel Index. For each percentile that 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. 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.
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, 2018 and ending on December 31, 2020. The two primary performance metrics, which are each weighted 50%, and goals 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% |
In addition, the award contains a modifier which can increase or decrease the award payout by up to 25% based on the Company’s TSR performance over the three-year performance period relative toperiod. Based upon performance during the NASDAQ Steel and Iron Index. For each percentile that 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 25% and the payout will 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.
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 timereceived 200.0% 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 versustheir targetpre-tax ROIC. Based upon performance as shown in the following table, they received only 1.35% of this PSU grant and accumulated dividends. long-term cash incentive award.
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
|
| |||||||||||||||||||||||||||||
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 2015 PSU Award, the Compensation Committee approved adjustments, in line with our general principles of how to treat unusual 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%. Details on the adjustments follow:
In calculating thepre-tax ROIC, the Compensation Committee adjusted for 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 qualification 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’s 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.
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 --5 — OTHER COMPENSATION INFORMATION
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.
Under our stock ownership guidelines, our executives are required to maintain direct ownership in our common stockCommon 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 had2023, 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.
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.
Under our Incentive Compensation Recoupment Policy,
Our recoupment, or “claw back, which was adopted, effective as of September 6, 2023, in accordance with SEC and NYSE requirements (the “NYSE Clawback Policy” policy allows for recoupment of), incentive compensation for our executives is subject to recovery in the event of a financial restatement. The NYSE Clawback Policy generally requires the Compensation Committee to recoup “excess” incentive-based compensation from any current or former executive officer if the payment was predicated on achieving certain financial results that were subsequently the subject of a restatement of Company financial statements due to material non-compliance with financial reporting requirements, subject to certain narrow exceptions. In such a case, the Compensation Committee generally will recoup all incentive-based compensation paid within the three-year look-back.period prior to the date that the Company is required to prepare the restatement to the extent that incentive-based compensation received exceeds the amount of incentive-based compensation that otherwise would have been received had it been determined based on the restated amounts.
34 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
In addition to the NYSE Clawback Policy, the Company also has a comprehensive conduct-based forfeiture and recovery policy. Under this policy, if the Company restates its financial statements, or if an officer of the Companyexecutive 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 such executive’s 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’sexecutive’s misconduct. This policy is intended to hold our executives accountable and to discourage imprudent behavior.
| • | 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 |
| • | 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 ($ |
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.
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.
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, ourDuring 2023, Meridian Compensation Partners, LLC (“Meridian”), independent compensation consultants to the Compensation Committee, in consultation with CAP, considered whetherconducted a risk assessment of our compensation programs, policies and processes for all employees, reviewing our practices forrelative to market “best practice” and considering risk mitigation factors. Meridian concluded that our employees, including the NEOs, werecompensation programs and practices do not create risks that are reasonably likely to have a material adverse effect on SunCoke Energy. In concluding that this was not the case, the Compensation Committee determinedSunCoke.
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 35
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Overall, we believe that our executive compensation program was consistentprograms contain an appropriate balance of fixed and variable features and short- and long-term incentives, as well as complementary metrics with SunCoke Energy’sreasonable, performance-based goals and payout curves under our incentive programs. We believe that these factors, combined with effective Board and management oversight, operate to mitigate risk management strategies. and reduce the likelihood of employees engaging in excessive risk-taking behavior with respect to the compensation-related aspects of their jobs.
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 five different corporatemultiple 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. Our stock ownership requirements help further align the interests of executives with those of stockholders.
Accounting and Tax Considerations
Section 409A of the Internal Revenue 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. 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 Internal Revenue Code.
Any equity awards granted to our employees, including those to executive officers, 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.”
36 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Summary Compensation Table
The following table sets forth compensation information for our NEOs for the fiscal years ended December 31, 2017,2023, December 31, 20162022 and December 31, 2015:2021:
Named Executive Officer | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($) | Total ($) | ||||||||||||||||||||
Michael G. Rippey(4) | ||||||||||||||||||||||||||||
President & CEO | 2017 | $60,577 | $0 | $1,769,020 | $399,997 | $0 | $0 | (5) | $2,229,594 | |||||||||||||||||||
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 | |||||||||||||||||||
Sr. VP & CFO | 2016 | $460,000 | $0 | $499,815 | $67,172 | $632,592 | $21,200 | $1,680,779 | ||||||||||||||||||||
| 2015 | $431,539 | (6) | $0 | $389,210 | $241,389 | $240,051 | $45,200 | $1,347,389 | ||||||||||||||||||||
Phillip M. Hardesty | 2017 | $380,000 | $0 | $182,393 | $45,596 | $403,389 | $117,596 | (9) | $1,128,974 | |||||||||||||||||||
Sr. VP, Com Ops, BD, | 2016 | $380,000 | $0 | $275,263 | $36,992 | $457,254 | $71,200 | $1,220,709 | ||||||||||||||||||||
Int’l Coke & Terminals | 2015 | $360,000(6) | $0 | $441,379 | $101,346 | $154,247 | $91,338 | $1,148,310 | ||||||||||||||||||||
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 | $810,368 | |||||||||||||||||||
Named Executive Officer | Year | Salary ($) | Bonus ($) | Stock Awards ($) (1) | Option Awards ($) (2) | Non-Equity Incentive Plan Compensation ($) (3) | All Other Compensation ($) | Total ($) | ||||||||||||||||||||||||||||||||
Michael G. Rippey Chief Executive Officer | 2023 | 1,030,399 | — | 2,681,498 | 3,084,168 | 240,893 | (4) | 7,036,958 | ||||||||||||||||||||||||||||||||
| 2022 | 981,332 | — | 2,502,391 | 3,792,665 | 203,588 | 7,479,976 | ||||||||||||||||||||||||||||||||||
| 2021 | 945,812 | — | 2,758,176 | 1,572,037 | 134,950 | 5,410,975 | ||||||||||||||||||||||||||||||||||
Katherine T. Gates President | 2023 | 661,500 | — | 759,486 | 930,794 | 146,049 | (5) | 2,497,829 | ||||||||||||||||||||||||||||||||
| 2022 | 477,405 | — | 358,052 | 929,714 | 119,204 | 1,884,375 | ||||||||||||||||||||||||||||||||||
| 2021 | 460,125 | — | 395,700 | 512,747 | 97,605 | 1,466,177 | ||||||||||||||||||||||||||||||||||
Mark Marinko SVP & Chief Financial Officer | 2023 | 470,000 | — | 359,749 | 470,129 | 76,654 | (6) | 1,376,532 | ||||||||||||||||||||||||||||||||
| 2022 | 391,667 | — | 352,488 | 487,111 | 15,403 | 1,246,669 | ||||||||||||||||||||||||||||||||||
P Michael Hardesty SVP, Com Ops, BD Int’l Coke & Terminals | 2023 | 481,893 | — | 368,859 | 698,325 | 139,789 | (7) | 1,688,866 | ||||||||||||||||||||||||||||||||
| 2022 | 458,945 | — | 344,208 | 893,765 | 126,369 | 1,823,287 | ||||||||||||||||||||||||||||||||||
| 2021 | 442,334 | — | 382,054 | 492,921 | 105,592 | 1,422,901 | ||||||||||||||||||||||||||||||||||
John F. Quanci VP, Chief Technology Officer | 2023 | 426,297 | — | 153,310 | 655,809 | 75,768 | (8) | 1,311,184 | ||||||||||||||||||||||||||||||||
| 2022 | 405,997 | — | 146,932 | 707,327 | 62,720 | 1,322,976 | ||||||||||||||||||||||||||||||||||
| 2021 | 391,302 | — | 137,768 | 495,122 | 58,410 | 1,082,602 | ||||||||||||||||||||||||||||||||||
| (1) | The amounts reported in this column reflect the grant date fair value of restricted share unit and performance share unit awards made under |
Named Executive Officer | 2023 ($) | ||||
Mr. Rippey | |||||
| 633,334 | ||||
| 299,994 | ||||
| |||||
| |||||
| |||||
| (2) | The |
| (3) | The amounts in this column reflect annual cash incentive payments to each NEO under |
| (4) |
|
|
|
The All Other Compensation column for |
|
The All Other Compensation column for |
|
|
| (6) | The All Other Compensation column for 2023 includes (i) $50,254 representing Company matching and annual contributions to the Savings Restoration Plan; and (ii) $26,400 representing Company matching contributions to the SunCoke 401(k) Plan. |
| (7) | The All Other Compensation column for 2023 includes (i) $63,389 representing Company matching and annual contributions to the Savings Restoration Plan; (ii) $26,400 representing Company matching contributions to the SunCoke 401(k) Plan; and (iii) $50,000 as a commuting allowance. |
| (8) | The All Other Compensation column for 2023 includes (i) $49,368 representing Company matching and annual contributions to the Savings Restoration Plan; and (ii) $26,400 representing Company matching contributions to the SunCoke 401(k) Plan. |
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 37
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
20172023 Grant of Plan-Based Awards Table
The following table sets forth the plan-based grants made during the fiscal year ended December 31, 2017:2023:
Estimated Future Payouts Under Non-Equity Incentive Plan awards (1) | Estimated Future Payouts Under Equity Incentive Plan awards (2) | |||||||||||||||||||||||||||||||||||||||||
Named Executive Officer | Grant Date | Threshold ($) (3) | Target ($) | Maximum ($) | Threshold (#) (4) | Target (#) | Maximum (#) | All Other No. of (#) (5) | All Other No. of (#) (6) | Exercise or Base Price of Option Awards ($/Share) (7) | Grant Date (8) | |||||||||||||||||||||||||||||||
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 | |||||||||||||||||||||||||||||||||||||||
F. West | — | 552,000 | 1,104,000 | |||||||||||||||||||||||||||||||||||||||
| 2/15/2017 | — | 21,790 | 54,475 | 248,399 | ||||||||||||||||||||||||||||||||||||||
| 2/15/2017 | 8,406 | 9.85 | 82,799 | |||||||||||||||||||||||||||||||||||||||
| 2/15/2017 | 9,105 | 9.85 | 41,397 | |||||||||||||||||||||||||||||||||||||||
| 2/15/2017 | 8,007 | 9.85 | 41,396 | |||||||||||||||||||||||||||||||||||||||
M. Hardesty | — | 399,000 | 798,000 | |||||||||||||||||||||||||||||||||||||||
| 2/15/2017 | — | 12,000 | 30,000 | 136,796 | ||||||||||||||||||||||||||||||||||||||
| 2/15/2017 | 4,629 | 9.85 | 45,596 | |||||||||||||||||||||||||||||||||||||||
| 2/15/2017 | 5,014 | 9.85 | 22,797 | |||||||||||||||||||||||||||||||||||||||
| 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 | |||||||||||||||||||||||||||||||||||||||
Estimated Future Payouts Under Non-Equity Incentive Plan awards | Estimated Future Payouts Under Equity Incentive Plan Awards (1) | All Other No. of (#) (3) | All Other No. of (#) (4) | Exercise or Base Price of Option Awards ($/Share) | Grant Date Fair Value of Stock and Option Awards ($) (5) | |||||||||||||||||||||||||||||||||||||||||||
Named Executive Officer | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) (2) | Target (#) | Maximum (#) | |||||||||||||||||||||||||||||||||||||||||
Mr. Rippey | 283,360 (6) | 1,133,439 (7) | 2,266,878 | |||||||||||||||||||||||||||||||||||||||||||||
| — (8) | 875,839 (9) | 1,751,678 | ||||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | — | 94,686 | 227,246 | 931,710 | ||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | 189,371 | 1,749,788 | ||||||||||||||||||||||||||||||||||||||||||||||
Ms. Gates | 132,300 (6) | 529,200 (7) | 1,058,400 | |||||||||||||||||||||||||||||||||||||||||||||
| — (8) | 248,063 (9) | 496,125 | ||||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | — | 26,818 | 64,363 | 263,889 | ||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | 53,636 | 495,597 | ||||||||||||||||||||||||||||||||||||||||||||||
Mr. Marinko | 88,125 (6) | 352,500 (7) | 705,000 | |||||||||||||||||||||||||||||||||||||||||||||
| — (8) | 117,500 (9) | 235,000 | ||||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | — | 12,703 | 30,487 | 124,998 | ||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | 25,406 | 234,751 | ||||||||||||||||||||||||||||||||||||||||||||||
Mr. Hardesty | 90,355 (6) | 361,420 (7) | 722,839 | |||||||||||||||||||||||||||||||||||||||||||||
| — (8) | 120,473 (9) | 240,946 | ||||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | — | 13,025 | 31,260 | 128,166 | ||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | 26,049 | 240,693 | ||||||||||||||||||||||||||||||||||||||||||||||
Mr. Quanci | 74,602 (6) | 298,408 (7) | 596,816 | |||||||||||||||||||||||||||||||||||||||||||||
| — (8) | 102,311 (9) | 204,623 | ||||||||||||||||||||||||||||||||||||||||||||||
| 02/23/2023 | — | — | — | 16,592 | 153,310 | |||||||||||||||||||||||||||||||||||||||||||
| (1) |
|
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 |
|
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. |
This column |
| (4) | No stock options were granted in 2023, as described in the Omnibus Plan section of the Compensation Discussion and Analysis. |
|
|
The grant date fair value was calculated in accordance with FASB ASC Topic 718. See Note 15 to Item 8 of the Company’s 2023 Form10-K |
| (6) | Under the AIP, no payment is made based on corporate performance 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 2023. Thus, the amounts shown in the columns reflect the range of potential payments when the performance goals were set in early 2023. Actual amounts paid for 2023 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. |
38 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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| (8) | Under the terms of the long-term cash incentive awards granted pursuant to the Omnibus Plan, 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 Omnibus Plan. Awards will vest based on performance during the period of 2023 - 2025 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 the Company 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 the Company. |
20172023 Outstanding Equity Awards at FiscalYear-End Table
The following table sets forth the outstanding equity awards as of December 31, 2017:2023:
| 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) | ||||||||||||||||||||||||
| Michael G. Rippey | 72,864 | (3) | 10.80 | 12/6/2027 | 148,148 | 1,776,295 | ||||||||||||||||||||||||||
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 | |||||||||||||||||||||||||||||
Fay West | 31,515 | 17.39 | 7/21/2021 | 14,429 | (10) | 173,004 | 108,947 | 1,306,275 | ||||||||||||||||||||||||
| 8,034 | 16.55 | 2/20/2023 | ||||||||||||||||||||||||||||||
| 8,069 | 22.30 | 2/26/2024 | ||||||||||||||||||||||||||||||
| 21,835 | 10,919 | (5) | 16.90 | 2/18/2025 | ||||||||||||||||||||||||||||
| 26,454 | 13,228 | (11) | 8.37 | 10/1/2025 | ||||||||||||||||||||||||||||
| 8,070 | 16,141 | (6) | 3.80 | 2/17/2026 | ||||||||||||||||||||||||||||
| 8,069 | 16,141 | (7) | 3.80 | 2/17/2026 | ||||||||||||||||||||||||||||
| 8,007 | (8) | 9.85 | 2/15/2027 | |||||||||||||||||||||||||||||
| 9,105 | (9) | 9.85 | 2/15/2027 | |||||||||||||||||||||||||||||
Phillip M. Hardesty | 40,000 | 13.75 | 9/12/2021 | 16,435 | (12) | 197,056 | 60,000 | 719,400 | ||||||||||||||||||||||||
| 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 | |||||||||||||||||||||||||||||
Katherine T. Gates | 2,400 | 16.55 | 2/20/2023 | 7,249 | (13) | 86,916 | 50,789 | 608,960 | ||||||||||||||||||||||||
| 1,986 | 22.30 | 2/26/2024 | ||||||||||||||||||||||||||||||
| 5,259 | 2,631 | (5) | 16.90 | 2/18/2025 | ||||||||||||||||||||||||||||
| 3,313 | 6,629 | (6) | 3.80 | 2/17/2026 | ||||||||||||||||||||||||||||
| 3,313 | 6,628 | (7) | 3.80 | 2/17/2026 | ||||||||||||||||||||||||||||
| 5,512 | (8) | 9.85 | 2/15/2027 | �� | ||||||||||||||||||||||||||||
| 6,268 | (9) | 9.85 | 2/15/2027 | |||||||||||||||||||||||||||||
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 | |||||||||||||||||||||||||||||
| Option Awards | Stock Awards | ||||||||||||||||||||||||||||||||||||||||||||
Named Executive Officer | No. of (#) | No. of Securities Underlying Unexercised Options UnExercisable (#) | Option ($) (1) | Option Expiration Date | No. of Shares (#) | Market Value ($) (2) | Equity (#) (3) | Equity ($) (2) | |||||||||||||||||||||||||||||||||||||
Mr. Rippey | 72,864 | 10.80 | 12/6/2027 | 429,860 | (4) | 4,616,696 | 205,313 | 2,205,062 | |||||||||||||||||||||||||||||||||||||
| 131,112 | 9.87 | 2/13/2029 | |||||||||||||||||||||||||||||||||||||||||||
Ms. Gates | 1,986 | 22.30 | 2/26/2024 | 88,098 | (5) | 946,173 | 42,647 | 458,029 | |||||||||||||||||||||||||||||||||||||
| 7,890 | 16.90 | 2/18/2025 | |||||||||||||||||||||||||||||||||||||||||||
| 5,512 | 9.85 | 2/15/2027 | |||||||||||||||||||||||||||||||||||||||||||
| 14,126 | 10.49 | 2/14/2028 | |||||||||||||||||||||||||||||||||||||||||||
| 20,537 | 9.87 | 2/13/2029 | |||||||||||||||||||||||||||||||||||||||||||
Mr. Marinko | — | — | — | — | 42,988 | (6) | 461,691 | 25,890 | 278,059 | ||||||||||||||||||||||||||||||||||||
Mr. Hardesty | 12,368 | 22.30 | 2/26/2024 | 59,261 | (7) | 636,463 | 28,242 | 303,319 | |||||||||||||||||||||||||||||||||||||
| 19,950 | 16.90 | 2/18/2025 | |||||||||||||||||||||||||||||||||||||||||||
| 4,410 | 9.85 | 2/15/2027 | |||||||||||||||||||||||||||||||||||||||||||
| 14,126 | 10.49 | 2/14/2028 | |||||||||||||||||||||||||||||||||||||||||||
| 20,537 | 9.87 | 2/13/2029 | |||||||||||||||||||||||||||||||||||||||||||
Mr. Quanci | 5,028 | 22.30 | 2/26/2024 | 36,388 | (8) | 390,807 | — | — | |||||||||||||||||||||||||||||||||||||
| 9,406 | 16.90 | 2/18/2025 | |||||||||||||||||||||||||||||||||||||||||||
| 4,532 | 3.80 | 2/17/2026 | |||||||||||||||||||||||||||||||||||||||||||
| 2,630 | 9.85 | 2/15/2027 | |||||||||||||||||||||||||||||||||||||||||||
| 3,905 | 10.49 | 2/14/2028 | |||||||||||||||||||||||||||||||||||||||||||
| 8,175 | 9.87 | 2/13/2029 | |||||||||||||||||||||||||||||||||||||||||||
| (1) |
|
|
|
| (2) | The market value of these shares is based on the closing price of the Company’s Common Stock on December 31, 2023, which was $10.74. |
| (3) | These shares reflect the target number of performance share units granted on February 24, 2022 for the 2022 - 2024 performance period and the target number of performance share units granted on February 23, 2023 for the 2023 -2025 performance period. |
| (4) |
|
|
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 39
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| (6) | 17,582 of these restricted share units were granted on March 7, 2022, of which one-half will vest on each of the second and third anniversary of the grant date. 25,406 of these restricted share units were granted on February 23, 2023, of which one-third will vest on each of the first, second and third anniversary of the grant date. |
| (7) | 12,923 of these restricted share units were granted on February 25, 2021, which will vest on the third anniversary of the grant date. |
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20172023 Option Exercises and Stock Vested Table
The following table sets forth the exercises of options and vested awards for the fiscal year ended December 31, 2017:2023:
| Option Awards | Stock Awards | |||||||||||||||
Named Executive Officer | No. of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | No. of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | ||||||||||||
Michael G. Rippey | 0 | 0 | 0 | 0 | ||||||||||||
Frederick A. Henderson | 0 | 0 | 29,546 | 289,883 | ||||||||||||
Fay West | 0 | 0 | 8,187 | 78,413 | ||||||||||||
Phillip M. Hardesty | 8,888 | 67,460 | 13,220 | 123,053 | ||||||||||||
Katherine T. Gates | 0 | 0 | 2,324 | 22,838 | ||||||||||||
Gary P. Yeaw | 0 | 0 | 5,922 | 58,081 | ||||||||||||
| Option Awards | Stock Awards | |||||||||||||||||||
Name | No. of Shares (#) | Value ($) (1) | No. of Shares (#) | Value ($) (2) | ||||||||||||||||
Mr. Rippey | — | — | 488,116 | 4,962,976 | ||||||||||||||||
Ms. Gates | — | — | 70,331 | 714,873 | ||||||||||||||||
Mr. Marinko | — | — | 8,792 | 84,227 | ||||||||||||||||
Mr. Hardesty | 17,778 | 101,512 | 67,695 | 687,994 | ||||||||||||||||
Mr. Quanci | — | — | 20,940 | 195,857 | ||||||||||||||||
| (1) | The |
| (2) | The amounts in this column represent the value realized by multiplying the closing price of our |
2017 Nonqualified Deferred Compensation TableSavings Restoration Plan
The following table sets forth information regarding the contributions, earnings and account balances under our Savings Restoration Plan or (“SRP for 2017:
| Named Executive Officer | Executive Contributions in 2017 ($) | 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 | |||||||||||||||
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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 ($270,000330,000 for 2017)2023). 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 participant’s eligible compensation deferred byfor the calendar year for which the participant under the SRP. The SRP was amended to provide that, effective January 1, 2016, employermakes contributions to the SRP were suspended. Employer contributions were reinstated beginning January 1, 2017.SRP.
Participants are always fully vested in their own deferrals as well as the 3% employer “safe harbor” 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
40 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
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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 under the SRP 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.
2023 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 2023:
Named Executive Officer | Executive in 2023 ($) (1) | Registrant ($) (2) | Aggregate (Losses) in 2023 ($) (3) | Aggregate ($) | Aggregate as of December 31, ($) (4) | ||||||||||||||||||||
Mr. Rippey | 134,058 | 214,493 | 367,913 | — | 1,850,340 | ||||||||||||||||||||
Ms. Gates | 49,781 | 79,649 | 114,302 | — | 741,385 | ||||||||||||||||||||
Mr. Marinko | 31,409 | 50,254 | 14,235 | — | 103,357 | ||||||||||||||||||||
Mr. Hardesty | 71,731 | 63,389 | 120,555 | — | 918,594 | ||||||||||||||||||||
Mr. Quanci | 30,855 | 49,368 | 91,372 | — | 689,748 | ||||||||||||||||||||
| (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 2023 and prior years: Mr. Rippey: $1,139,029; Ms. Gates: $500,962; Mr. Marinko: 9,810; Mr. Hardesty: $665,513; and Mr. Quanci: $520,285. |
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 to(for each VP), one and a half times (for each SVP), and two times (for CEO) of 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
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 41
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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.
Omnibus Long-Term Performance EnhancementIncentive Plan
Under the LTPEP,Omnibus Plan, 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)Omnibus Plan), 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,for participants who have (i) attained of at least age 55, and (ii) and whose actual age plus years of service equals at least 65, 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. However, beginning in 2021, PSU and LTI Cash grants for executives that retire and have attained at least 65 years of age and completed five years of credited service with SunCoke Energy, will continue to vest without proration, and will be paid out at Company performance at the end of the performance period.
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, retirement means age 55 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 equal 65.
42 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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, 2017:2023:
| Named Executive Officer | Death/Disability ($) | Termination ($) | Termination in With a Change in Control ($) | |||||||||
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 ($) | Termination in Connection with a Change in Control ($) | |||||||||
Mr. Rippey | ||||||||||||
• Cash Severance (1) | — | 4,327,676 | 4,327,676 | |||||||||
• Annual Incentive (2) | 1,511,668 | 1,511,668 | 1,511,668 | |||||||||
• Health & Welfare Continuation (3) | — | 15,166 | 15,457 | |||||||||
• Stock Option Acceleration Value (4) | 114,067 | 114,067 | 114,067 | |||||||||
• Restricted Share Units Acceleration Value (4) | 4,616,696 | 4,108,235 | 4,108,235 | |||||||||
• Performance Share Units Acceleration Value (4) | 2,205,062 | 2,205,062 | 3,573,048 | |||||||||
• Long-Term Cash Incentive (5) | 1,709,972 | 1,709,972 | 2,514,326 | |||||||||
• Outplacement (6) | — | 8,900 | 8,900 | |||||||||
TOTAL | 10,157,465 | 14,000,746 | 16,173,377 | |||||||||
Ms. Gates | ||||||||||||
• Cash Severance (1) | — | 1,786,050 | 2,381,400 | |||||||||
• Annual Incentive (2) | 705,794 | 705,794 | 705,794 | |||||||||
• Health & Welfare Continuation (3) | 1,310 | 2,030 | ||||||||||
• Stock Option Acceleration Value (4) | 26,304 | 26,403 | 26,304 | |||||||||
• Restricted Share Units Acceleration Value (4) | 946,173 | — | — | |||||||||
• Performance Share Units Acceleration Value (4) | 458,029 | — | 656,759 | |||||||||
• Long-Term Cash Incentive (5) | 367,414 | — | 478,331 | |||||||||
• Outplacement (6) | — | 8,900 | 8,900 | |||||||||
TOTAL | 2,503,713 | 2,528,358 | 4,259,519 | |||||||||
Mr. Marinko | ||||||||||||
• Cash Severance (1) | — | 1,233,750 | 1,645,000 | |||||||||
• Annual Incentive (2) | 470,129 | 470,129 | 470,129 | |||||||||
• Health & Welfare Continuation (3) | 25,093 | 34,421 | ||||||||||
• Stock Option Acceleration Value (4) | — | — | — | |||||||||
• Restricted Share Units Acceleration Value (4) | 461,691 | — | — | |||||||||
• Performance Share Units Acceleration Value (4) | 278,059 | — | 441,445 | |||||||||
• Long-Term Cash Incentive (5) | 235,000 | — | 348,505 | |||||||||
• Outplacement (6) | — | 8,900 | 8,900 | |||||||||
TOTAL | 1,444,879 | 1,737,872 | 2,948,401 | |||||||||
Mr. Hardesty | ||||||||||||
• Cash Severance (1) | — | 1,264,968 | 1,686,624 | |||||||||
• Annual Incentive (2) | 482,025 | 482,025 | 482,025 | |||||||||
• Health & Welfare Continuation (3) | 19,172 | 26,137 | ||||||||||
• Stock Option Acceleration Value (4) | 25,324 | 25,324 | 25,324 | |||||||||
• Restricted Share Units Acceleration Value (4) | 636,463 | 566,522 | 566,522 | |||||||||
• Performance Share Units Acceleration Value (4) | 303,319 | 155,583 | 491,489 | |||||||||
• Long-Term Cash Incentive (5) | 235,210 | 116,649 | 345,850 | |||||||||
• Outplacement (6) | — | 8,900 | 8,900 | |||||||||
TOTAL | 1,682,341 | 2,639,142 | 3,632,870 | |||||||||
| Named Executive Officer | Death/Disability ($) | Termination ($) | Termination in 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 | $2,694,501 | |||||||||
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Named Executive Officer | Death/Disability ($) | Termination Prior to a Change in Control ($) | Termination in Connection with a Change in Control ($) | |||||||||
Mr. Quanci | ||||||||||||
• Cash Severance (1) | — | 724,705 | 1,449,411 | |||||||||
• Annual Incentive (2) | 397,987 | 397,987 | 397,987 | |||||||||
• Health & Welfare Continuation (3) | 29,767 | 40,654 | ||||||||||
• Stock Option Acceleration Value (4) | 41,881 | 41,881 | 41,881 | |||||||||
• Restricted Share Units Acceleration Value (4) | 390,807 | — | — | |||||||||
• Performance Share Units Acceleration Value (4) | — | — | — | |||||||||
• Long-Term Cash Incentive (5) | 199,751 | — | 293,712 | |||||||||
• Outplacement (6) | — | 8,900 | 8,900 | |||||||||
TOTAL | 1,030,426 | 1,203,240 | 2,232,544 | |||||||||
| (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 |
| (3) | These amounts reflect the continuation of medical benefits and life insurance coverage under the Executive Involuntary Severance Plan and the continuation of medical, |
| (4) | The market value of stock options, RSUs and PSUs that would vest under |
| (5) | These amounts represent the value of long-term performance cash awards that would vest, and is based on performance as of December 31, 2023. |
| (6) | These amounts represent the outplacement benefit our executives are eligible to receive under each termination 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 2023 total annual compensation for our CEO was $7,036,958. We estimate that the 2023 total annual compensation for the median employee out of all our employees, excluding our CEO, calculated in the same manner that the total compensation of our CEO was calculated and reported in the Summary Compensation Table, was $111,908. The resulting ratio of our CEO’s total annual compensation to that of the median employee, excluding our CEO, for 2023 is approximately 62.9 to 1.
To identify the median of our employees, we used the gross annual earnings reported to taxing authorities and ranked employees from highest to lowest for all employees as of December 31, 2021. Employee data is annualized for new hires and employees with a leave of absence.
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 provides for companies to adopt a variety of methodologies, apply certain exclusions, and 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 ours, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions.
44 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
Value of Initial Fixed $100 Investment Based on: | ||||||||||||||||||||||||||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | ||||||||||||||||||||||||||||||||
Year | Summary Compensation Table Total for PEO (1) ($) | Compensation Actually Paid to PEO (2) ($) | Average Summary Compensation Table Total for Non-PEO NEOs (3) ($) | Average Compensation Actually Paid to Non-PEO NEOs (4) ($) | Total Shareholder Return ($) | Peer Group Total Shareholder Return (5) ($) | Net Income (6) ($mm) | Adjusted EBITDA (7) ($mm) | ||||||||||||||||||||||||||||||||
2023 | 7,036,958 | 9,716,485 | 1,718,603 | 1,999,733 | 205 | 301 | 57.5 | 268.8 | ||||||||||||||||||||||||||||||||
2022 | 7,479,976 | 10,983,862 | 1,255,461 | 1,490,330 | 158 | 222 | 100.7 | 297.7 | ||||||||||||||||||||||||||||||||
2021 | 5,410,975 | 8,598,532 | 1,092,805 | 1,010,626 | 116 | 190 | 43.4 | 275.4 | ||||||||||||||||||||||||||||||||
2020 | 4,013,702 | 2,664,824 | 1,135,178 | 879,759 | 74 | 110 | 3.7 | 205.9 | ||||||||||||||||||||||||||||||||
| (1) | For each of the years shown in the foregoing table, the Principal Executive Officer (“PEO”) is Michael G. Rippey. The dollar amounts reported in column (b) are the amounts of total compensation reported for Mr. Rippey for each corresponding year in the “Total” column of the Summary Compensation Table (“SCT”). |
| (2) | The dollar amounts reported in column (c) represent the amount of “compensation actually paid” (“CAP”) to the PEO computed in accordance with Item 402(v) of Regulation S-K. As required, these dollar amounts include (among other items) unpaid amounts of equity compensation that may be realizable in future periods, and as such, these dollar amounts do not reflect the actual amount of compensation earned by, or paid to, the PEO during the applicable year. In accordance with the requirements of Item 402(v) ofRegulation S-K, the following adjustments were made to the PEO’s total compensation to determine the CAP: |
Year | Reported Summary Compensation Table Total for PEO ($) | Minus: Reported Summary Compensation Table Value of Equity Awards (i) ($) | Plus: Equity Award Adjustments (ii) ($) | Compensation Actually Paid to PEO ($) | ||||||||||||||||
2023 | 7,036,958 | 2,681,498 | 5,361,026 | 9,716,485 | ||||||||||||||||
2022 | 7,479,976 | 2,502,391 | 6,006,277 | 10,983,862 | ||||||||||||||||
2021 | 5,410,975 | 2,758,176 | 5,945,733 | 8,598,532 | ||||||||||||||||
2020 | 4,013,702 | 2,203,220 | 854,342 | 2,664,824 | ||||||||||||||||
|
Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
| (ii) | The equity award adjustments for 2023 were calculated in accordance with the methodology required by Item 402(v) of Regulation S-K, to include the fair value of current and prior year equity awards that are outstanding, vested or forfeited during the applicable year, instead of the grant date value of awards granted during the applicable year and include accrued dividend equivalents. Since the Company does not provide a defined benefit pension plan to its executives, there is no adjustment required for this element. The amounts deducted or added in calculating the equity award adjustments for the PEO are provided in the table below. |
Year | Year-End Fair Value of Current Year Awards Outstanding as of Year End ($) | Change in Value as of Year-End for Prior Year Awards Outstanding as of Year-End ($) | Change in Value as of Vesting Date for Prior Year Awards that Vested During the Year ($) | Value as of Vesting Date for Current Year Awards that Vested During the Year* ($) | Value as of Vesting Date for Dividend Equivalents that Vested During the Year ($) | Value as of Prior Year-End for Prior Year Awards Forfeited During the Year ($) | Value of Equity for Purpose of Reporting “Compensation Actually Paid” ($) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2023 | 3,177,698 | + | 1,459,244 | + | 348,046 | + | 0 | + | 376,038 | - | 0 | = | 5,361,026 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
* | We generally do not issue equity awards that vest in the year of grant. |
| (3) | The dollar amounts reported in column (d) represent the average of the amounts reported for the Company’s NEOs as a group (excluding the PEO) in the “Total” column of the SCT in each applicable year. Our non-PEO NEOs included in the table above are the following individuals: |
| (4) | The dollar amounts reported in column (e) represent the average amount of “compensation actually paid” to the Non-PEO NEOs as a group, as computed in accordance with Item 402(v) of RegulationS-K. The dollar amounts do not reflect the actual average amount of compensation earned by, or paid to, theNon-PEO NEOs as a group during the applicable year. In accordance with the requirements of Item 402(v) of RegulationS-K, the following adjustments were made to average total compensation for theNon-PEO NEOs as a group to determine the compensation actually paid: |
Year | Average Reported Summary Compensation Table Total for Non-PEO NEOs($) | Minus: Average Reported Summary Compensation Table Value of Equity Awards for Non-PEO NEOs (i) ($) | Plus: Average Equity Award Adjustments (ii) ($) | Average Compensation Actually Paid to Non-PEO NEOs ($) | ||||||||||||||||
2023 | 1,718,603 | 410,351 | 691,481 | 1,999,733 | ||||||||||||||||
2022 | 1,255,461 | 240,336 | 475,205 | 1,490,330 | ||||||||||||||||
2021 | 1,092,805 | 385,980 | 303,801 | 1,010,626 | ||||||||||||||||
2020 | 1,135,178 | 280,532 | 25,113 | 879,759 | ||||||||||||||||
| (i) | Represents the average total of the amounts reported in the “Stock Awards” column of the Summary Compensation Table for the Non-PEO NEOs for the applicable year. |
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| (ii) | The equity award adjustments for 2023 were calculated using the same methodology described above in footnote (2) with respect to reconciliation of Summary Compensation Table total amounts to total “Compensation Actually Paid” for the PEO. Since the Company does not provide a defined benefit pension plan to its executives, there is no adjustment required for this element. The amounts deducted or added in calculating the equity award adjustments for the PEO are provided in the table below. |
Year | Average Year-End Fair Value of Current Year Awards Outstanding as of Year End ($) | Average Change in Value as of Year-End for Prior Year Awards Outstanding as of Year-End ($) | Average Change in Value as of Vesting Date for Prior Year Awards that Vested During the Year ($) | Average Value as of Vesting Date for Current Year Awards that Vested During the Year* ($) | Average Value as of Vesting Date for Dividend Equivalents that Vested During the Year ($) | Average Value as of Prior Year-End forPrior Year Awards Forfeited During the Year ($) | Average Value of Equity for Purpose of Reporting “Compensation Actually Paid” ($) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2023 | 485,414 | + | 136,350 | + | 31,182 | + | 0 | + | 38,534 | - | 0 | = | 691,481 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| (iii) | * We generally do not issue equity awards that vest in the year of grant. |
| (5) | The cumulative TSR depicts a hypothetical $100 investment in SunCoke Energy common stock on December 31, 2019, and shows the value of that investment over time (assuming the reinvestment of dividends) for each calendar year. A hypothetical $100 investment in the peer group using the same methodology is shown for comparison. As permitted by SEC rules, for 2020, 2021, and 2022, the Company utilized the NASDAQ U.S. Benchmark Iron & Steel Index, which is the industry peer group we used for purposes of Item 201(e) of Regulation S-K. The dollar values shown in column (g) of the table thus reflect the NASDAQ U.S. Benchmark Iron & Steel Index TSR. The fourteen companies currently included in this index are: Cleveland-Cliffs Inc, Commercial Metals Co, Carpenter Technology Corp, Haynes International Inc, Nucor Corp, Northwest Pipe Co, Reliance Steel & Aluminum Co, Ryerson Holding Corp, Schnitzer Steel Industries Inc, Steel Dynamics Inc, Timkensteel Corp, Worthington Industries Inc, United States Steel Corp and Olympic Steel Inc. The separate peer group used by the Compensation Committee for purposes of determining compensation paid to our executive officers is described on page 27 of this proxy statement. |
| (6) | Presented in millions. Net income is as listed in the Company’s financial statements in accordance with U.S. GAAP. |
| (7) | In accordance with SEC rules, the Company is required to include in the Pay versus Performance table the “most important” financial performance measure (as determined by the Company) used to link compensation actually paid to our executive officers to company performance for the most recently completed fiscal year. The Company has determined that Adjusted EBITDA , which is a metric included in our long-term and short-term incentive programs. Management believes that Adjusted EBITDA best reflects the ongoing performance of the Company during the periods presented and provides relevant and meaningful insight to investors regarding the Company’s operating results. We therefore have included this performance measure in the Pay versus Performance table. Adjusted EBITDA is anon-GAAP measure used to supplement the Company’s U.S. GAAP disclosures and should not be viewed as alternatives to U.S. GAAP measures of performance. Furthermore, suchnon-GAAP measures may not be consistent with similar measures provided or used by other companies. |
Most Important Performance Measures (Unranked) |
| • Adjusted EBITDA |
| • Operating Cash Flow |
| • Pre-tax Return on Invested Capital (ROIC) |
| • Safety Performance |
| • Environmental Performance |
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Reasons for Amendmentpurposes of the 2013 Plan
The 2013 Plan is intendedtabular disclosure and the following charts was calculated in accordance with SEC rules and does not fully represent the actual final amount of compensation earned by, or actually paid to, promoteour NEOs during the interests ofapplicable years.
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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 interestsstock price on CAP primarily due to increase the maximum number of shares of Common Stock available for grant under the Plan. The Company’s use of equity incentives that are tied directly to stock price, as described above. Notably, the Company does not use Net Income to determine compensation allows it to offer market competitive compensation packages that more effectively align employee incentiveslevels or long-term incentive plan payouts.
Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
unvested awards with shareholders ’interests. As of March 7, 2018, only 1,317,829 shares of our common stock remained available for future award grants. Without an increasedescribed in detail in the number of shares of common stock available for grantCompensation Discussion and Analysis beginning on page 21, awards issued 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:
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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 strategycompensation program are directly linked to stock price and represent a substantial portion of emphasizing equity grants to executivesour NEOs’ compensation which serves to align theirour executives’ interests to those ofwith our stockholders, and also reviewed an analysisshareholders’ interests. The impact of equity grant practicesincentive compensation is greater for our industry peer group provided by our independentthe PEO’s CAP calculation because the portion of his 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:
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NOTES TO TABLE
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The following summary is qualified in its entirety by reference to the full text of the Plan, attached hereto as Exhibit A.
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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.
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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.
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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.
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Awards under the Plan may bedelivered in the form of any one or moreequity incentives is greater than that for the
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.
| Proposal
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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.
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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.
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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.
| The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information |
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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.PROPOSAL 2:
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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.
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 stockholders 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 stockholder value overpaying for performance and aligning pay with the long-term.long-term interests of our stockholders. Our compensation structure has a strong performance orientation with a significant portion of pay at risk based on short and longer-term performance.risk. The level of pay at risk increases progressively at positions of greater responsibility. Our compensation levelsWe focus on market-based pay, and 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. LeadershipNEO compensation is alignedaligns with stockholders’ interests; leadership will be rewardedshareholder interests through higher compensation when financial and operational goals are met or exceeded, and decreased compensation when the interests of stockholders are advanced, and realize compensation reductions when the share price declines.Company fails to perform. The compensation structure further 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 stockholders 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 stockholders 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 stockholders and to the extent there is any significant vote against the NEO compensation as disclosed in this proxy statement, we will consider our stockholders’ 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 2017 Annual Meeting of Stockholders.
RECOMMENDATION
We believe our stockholders should support our compensation structure for the following reasons:annually.
Our compensation structure is aligned with the interests of our stockholders. Relative to our peer group and based on industry surveys, our percentage mix of performance-based equity is greater than that of most other companies.
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 and share price performance, as realizable and realized pay historically has reflected total shareholder return.
The Board of Directors recommends you vote “FOR” the advisory approval of our executive compensation.
RECOMMENDATION We believe our stockholders should support our compensation structure for the following reasons: • Our compensation structure is aligned with the interests of our stockholders. Our annual incentive has a corporate balance of 80% financial operational metrics and 20% safety and environmental operational metrics. Both our long-standing safety and environmental metrics are based on objective performance criteria. • Our mix of performance-based equity is consistent with our peer group and industry practices, and rewards cumulative financial performance, as well as shareholder return. • Our metrics and targets are based on the demanding business plan and challenging safety and environmental targets approved by the Board of Directors. • 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. • Our executives have been appropriately rewarded or penalized for financial, safety and environmental operational performance and share price performance. The Board of Directors recommends you vote “FOR” the advisory approval of our executive compensation. | ||||||
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
PROPOSAL 4 -- 3:
ADVISORY VOTE TO APPROVEON 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 whetherthe frequency of future advisory votes on executive compensation of the nature reflected in Proposal 32 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 20122018 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.(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 advisory, and therefore 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 Boardnext advisory vote on the frequency of Directors recommends that you vote for “ONE YEAR” to hold afuture stockholder advisory vote to approvevotes on executive compensation each year.will be held at our 2030 Annual Meeting of Stockholders.
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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 stockCommon 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) | 14,428,880 | 17.20 | % | |||||
The Vanguard Group (2) | 6,765,652 | 8.08 | % | |||||
Dimensional Fund Advisors LP (3) | 6,347,707 | 7.58 | % | |||||
State Street Corporation (4) | 5,536,805 | 6.61 | % | |||||
Pacer Advisors, Inc. (5) | 4,241,721 | 5.06 | % | |||||
| (1) | Number is as of December 31, |
| (2) | Number is as of December 31, |
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| (3) | Number is as of December 31, 2023 and is based on information contained in an amended Schedule 13G filed with the SEC on February 9, 2024. Dimensional Fund Advisors LP reported sole voting power with respect to 6,250,953 shares and sole dispositive power with respect to 6,347,707 shares. The mailing address of Dimensional Fund Advisors LP is 6300 Bee Cave Road, Building One, Austin, TX 78746. |
| (4) | Number is as of December 31, |
| (5) | Number is as of December 31, |
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 53
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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, 2024 by each director of SunCoke Energy,the Company’s directors, including director-nominees, 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 March 7, 2018(1) | Total | Percent of Common Stock Outstanding | ||||||||||||||||
Michael G. Rippey | 0 | — | 0 | * | ||||||||||||||||
John W. Rowe | 5,000 | (2) | — | 5,000 | * | |||||||||||||||
Andrew D. Africk | 23,990 | — | 23,990 | * | ||||||||||||||||
Alvin Bledsoe | 5,934 | (2) | — | 5,934 | * | |||||||||||||||
Peter B. Hamilton | 63,490 | — | 63,490 | * | ||||||||||||||||
Susan R. Landahl | 0 | — | 0 | * | ||||||||||||||||
Robert A. Peiser | 23,990 | — | 23,990 | * | ||||||||||||||||
James E. Sweetnam | 0 | — | 0 | * | ||||||||||||||||
Fay West | 26,305 | 144,813 | 171,118 | * | ||||||||||||||||
P. Michael Hardesty | 67,983 | 97,691 | 165,674 | * | ||||||||||||||||
Gary P. Yeaw | 44,070 | 77,854 | 121,924 | * | ||||||||||||||||
Katherine T. Gates | 7,916 | 29,457 | 37,373 | * | ||||||||||||||||
All directors and executive officers as a group (12 persons) | 268,678 | 349,815 | 618,493 | * | ||||||||||||||||
Name | Shares of Common Stock (1) | Right to Acquire Within March 15, 2024(2) | Total | Percent of Common Stock Outstanding | ||||||||||||
Michael G. Rippey | 242,093 | 203,976 | 446,069 | * | ||||||||||||
Arthur F. Anton | 73,179 | — | 73,179 | * | ||||||||||||
Martha Z. Carnes | 85,468 | | — | | 85,468 | * | ||||||||||
Ralph M. Della Ratta, Jr. | 79,005 | | — | | 79,005 | * | ||||||||||
Susan R. Landahl | 110,592 | | — | | 110,592 | * | ||||||||||
Michael W. Lewis | 49,496 | — | 49,496 | * | ||||||||||||
Andrei A. Mikhalevsky (3) | 14,546 | | — | | 14,546 | * | ||||||||||
Katherine T. Gates | 189,754 | 50,051 | 239,805 | * | ||||||||||||
Mark W. Marinko | 13,705 | | — | | 13,705 | * | ||||||||||
P. Michael Hardesty | 217,323 | 71,391 | 288,714 | * | ||||||||||||
John F. Quanci | 19,922 | 33,676 | 53,598 | * | ||||||||||||
All directors and executive officers as a group (11 persons) | 1,095,083 | 359,094 | 1,454,177 | 1.73 | % | |||||||||||
| * | Less than one percent of our outstanding |
| (1) | The amounts shown in this column include common stock units held by non-management directors. Certain directors elected to defer their stock awards into share units under the Directors’ Deferred Compensation Plan, which was replaced by the Omnibus Plan in May 2022. The following directors hold such deferred share units: Mr. Anton: 25,983 units; Ms. Carnes: 56,235 units; Ms. Landahl: 83,753 units; and Mr. Lewis: 22,657 units. These directors also hold restricted stock units, or RSUs, that have been granted under the Omnibus Plan: Ms. Carnes: 26,839 RSUs; Ms. Landahl: 26,839 RSUs; Mr. Lewis: 26,839 RSUs; and Mr. Mikhalevsky: 14,546 RSUs. Each of the deferred share units and RSUs is treated as if it were invested in shares of Common Stock, but neither the deferred share units nor the RSUs have voting rights. The deferred share units and RSUs are settled in shares of Common Stock following termination of the director’s service on the Board of Directors. |
| (2) | The amounts shown in this column reflect shares of |
|
Delinquent Section 16(a) Reports
CertainUnder Section 16 of ourthe Exchange Act, directors, and executive officers, own common units representing limited partnership interestsand certain stockholders of SunCoke Energy Partners, L.P., a master limited partnership in which SunCoke Energy has a 61.2%the Company are required to file reports of beneficial ownership interest.of Company stock and changes therein with the SEC. The number of such common units beneficially owned by individuals listed in the “Beneficial Stock Ownership of DirectorsCompany believes that its directors, executive officers, and Executive Officers” Table as of March 7, 2018 is as follows (each person has sole investment and voting power over the securities listed):stockholders timely complied with all Section 16 filing requirements during 2023.
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 | * | ||||||||||||||||||||||||||||
54 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
|
The following is the report of the Audit Committee dated February 14, 2018 with respect to SunCoke Energy’s audited financial statements for the year ended December 31, 2017.2023. 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: Messrs. Bledsoe, Hamilton and Sweetnam. All ofassists the members 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. A copy of the charter can be found on our corporate website atwww.suncoke.com.
The Audit Committee is responsible primarily for assisting the Board of Directors in fulfilling its oversight responsibility of reviewing the Company’s financial information that will be provided to stockholders and others, appointingstatements. Management has the independent registered public accounting firm and reviewingprimary responsibility for 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 auditsthe reporting process and its membersmaintaining an effective system of internal controls over financial reporting. The Company’s independent auditors are not auditors or certifiersengaged to audit and express opinions on the conformity of SunCoke Energy’sthe Company’s financial statements.statements to United States generally accepted accounting principles.
In addition to fulfilling its oversight responsibility of appointingresponsibilities as set forth in its charter and reviewingfurther described above in the services performed by our independent registered public accounting firm,section titled “Audit Committee,” the Audit Committee carefully reviewshas performed the policiesfollowing:
| • | Prior to the filing of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, reviewed and discussed the audited financial statements for the year ended December 31, 2023 with SunCoke Energy’s management and KPMG LLP (“KPMG”). |
| • | Discussed with KPMG the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC. |
Evaluated KPMG’s qualifications, performance and procedures forindependence (consistent with SEC requirements), which included the engagementreceipt and review of our independent registered public accounting firm, including the scope of the audit, audit fees, 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, 2017 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 Public Company Accounting Oversight Board Auditing Standard No. 1301, Communications with Audit Committees.
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 BoardPCAOB regarding KPMG’s communications with the Audit Committeeaudit committee concerning independence and has discusseddiscussions with KPMG regarding its independence from SunCoke Energy.independence.
Based on the reviews and discussions with management and KPMG referred to above, including the review of KPMG’s disclosures and letter to the Audit Committee hasand review of the representations of management and the reports of KPMG, the Audit Committee 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, 2017.2023 filed with the SEC.
MembersAudit Committee of the Audit Committee:Board:
Alvin BledsoeMartha Z. Carnes (Chair)
Peter B. HamiltonRalph M. Della Ratta, Jr.
James E. SweetnamMichael W. Lewis
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 55
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
The following table sets forth the fees billed by our independent registered public accounting firm for the years ended December 31, 20172023 and December 31, 2016.2022. KPMG LLP served as our principal independent registered public accountant for the fiscal years ended December 31, 20172023 and December 31, 2016.2022. 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) | ||||||||||||
| KPMG LLP 2017 | KPMG LLP 2016 | |||||||||||
Audit Fees(2) | $1,440,000 | $1,471,300 | ||||||||||
Audit-Related Fees (3) | 139,100 | — | ||||||||||
Tax Fees(4) | 15,110 | 34,620 | ||||||||||
All Other Fees | 63,630 | — | ||||||||||
Total | $1,657,840 | $1,505,920 | ||||||||||
Audit and Non-Audit Fees | ||||||||||
| KPMG LLP 2023 | KPMG LLP 2022 | |||||||||
Audit Fees (1) | $ | 1,535,000 | $ | 1,561,665 | ||||||
Audit-Related Fees (2) | 30,210 | 20,000 | ||||||||
Tax Fees (3) | 330,000 | 345,575 | ||||||||
All Other Fees | — | — | ||||||||
|
|
|
| |||||||
Total | $ | 1,903,373 | $ | 1,927,240 | ||||||
| (1) |
|
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. |
Audit-related fees relate to assurance and related services (e.g., transactional accounting research-related fees), 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 |
Tax fees relate to professional services rendered in connection with tax audits, |
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 One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
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, 2018.2024. 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 20182024 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 Directors 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.
RECOMMENDATION The Board unanimously 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, 2024. | ||||||
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 57
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
QUESTIONS AND ANSWERS ABOUT THE 2024 ANNUAL MEETING
References to “the Company”, “SunCoke Energy”, “we”, “us” and “our” in this proxy statement mean SunCoke Energy, Inc.
| Q: | Who is soliciting my vote? |
| A: | The Board, on behalf of 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 2024 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 2024 Annual 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. |
| Q: | Why did I receive a notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials? |
| A: | 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. |
| Q: | What am I voting on? |
| A: | You are voting on the following proposals: |
| • | Proposal 1: Election of Mr. Ralph M. Della Ratta, Jr. and Ms. Susan R. Landahl to the class of directors whose term expires in 2027 (see pages 5 through 6); |
| • | Proposal 2: Non-binding advisory vote to approve the compensation of our named executive officers (see Page 51); |
| • | Proposal 3: Non-binding advisory vote on the frequency of future advisory votes on executive compensation (see page 52); |
| • | Proposal 4: Ratification 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, 2024 (see page 57); and |
Any other business properly coming before the meeting.
| Q: | How does the Board of Directors recommend that I vote my shares? |
| A: | 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; |
58 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
| • | Proposal 2:“FOR” the non-binding advisory vote to approve the compensation of our named executive officers; |
| • | Proposal 3: For “ONE YEAR” to hold an advisory stockholder vote to approve executive compensation every year; and. |
| • | Proposal 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, 2024. |
| Q: | Who is entitled to vote? |
| A: | Only stockholders of record at the close of business on March 19, 2024 are entitled to vote at the 2024 Annual Meeting. As of that date, there were 84,075,484 shares of our Common Stock outstanding. Each share of Common Stock is entitled to one vote. There is no cumulative voting. |
| Q: | How many votes must be present to hold the meeting? |
| A: | Your shares are counted as present at the 2024 Annual Meeting if you attend the meeting and vote 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 19, 2024 must be present live or by proxy at the meeting. This is referred to as a 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 2024 Annual Meeting. |
| Q: | How are votes counted? How many votes are needed to approve each of the proposals? |
| A: | For Proposal 1, you may vote “FOR,” “AGAINST,” or “ABSTAIN” for each director-nominee. The affirmative vote of a majority of the votes cast for the election of directors at the 2024 Annual Meeting is required to elect a nominee as a director. Abstentions and broker non-votes are not counted as a vote cast either “FOR” or “AGAINST” a nominee, and thus have no effect. Our By-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 the By-laws. |
For Proposals 2 and 4, you may vote “FOR”, “AGAINST”, or “ABSTAIN,” and the affirmative vote of a majority of the shares present live or by proxy and entitled to vote on these proposals at the 2024 Annual Meeting is required for approval. Thus, in order to be approved, Proposals 2 and 4 each must receive more than fifty percent (50%) of the shares present live or represented by a proxy at the 2024 Annual Meeting and entitled to vote at the meeting. Abstentions will have the effect of a vote “AGAINST” these proposals. Broker non-votes will have no effect on the outcome of the matters to be voted on in Proposal 2. There will be no broker non-votes with respect to Proposal 4, since it is the only item on the agenda for which brokers may exercise their discretion to vote “FOR” or “AGAINST” the proposal in the absence of any instructions from the beneficial owners.
For Proposal 3, you 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 3, the frequency of the advisory vote to approve executive compensation (every one, two, or three years) receiving the affirmative plurality of the shares present live or represented by a proxy at the 2024 Annual Meeting and entitled to vote at the meeting will be considered the frequency recommended by stockholders. Abstentions and broker non-votes will have no effect on the voting for this proposal.
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 59
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
| Q: | What is a “broker non-vote”? |
| A: | A broker non-vote occurs when the beneficial owner of shares 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 a 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 street name may vote on the proposal without voting instructions. As a result, brokers are not entitled to vote on Proposals 1, 2 and 3 at the 2024 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 counted for establishing the presence of a quorum. If you do not provide voting instructions to your bank, broker, trustee or other nominee holding shares of Common Stock for you, your shares will not be voted with respect to Proposals 1, 2, or 3. |
| Q: | How do I vote? |
| A: | You can vote either by attending at the 2024 Annual Meeting or by proxy without attending the meeting. Most stockholders have four options for submitting their votes: |
| • | 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; |
| • | Over the Internet, at the address provided on the Notice of Internet Availability or on your proxy card or voting instruction form. 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 2024 Annual Meeting in order for your shares to be voted; or |
| • | Live at the 2024 Annual Meeting. Shares held in your name as the stockholder of record may be voted by you at the 2024 Annual Meeting. Shares held beneficially in “street name” may be voted by you at the 2024 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 2024 Annual Meeting. If you vote by proxy and also attend the 2024 Annual Meeting, you do not need to vote again at the 2024 Annual Meeting unless you wish to change your vote. |
If you are the registered stockholder (that is, if you hold your stock in your own 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 vote via the telephone or over the Internet. Even if you plan to attend the 2024 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 hold that proxy during the meeting to vote at the meeting.
60 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
| Q: | Can I change or revoke my vote? |
| A: | YES. You can change or revoke your vote at any time before the polls close at the 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 2024 Annual Meeting and 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 2024 Annual Meeting will not in and of itself revoke a previously submitted proxy unless you specifically request it.
| Q: | Who counts the votes? |
| A: | We have retained Computershare Trust Company, N.A., our transfer agent, to act as independent inspector of election and as proxy vote tabulator 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 2024 Annual Meeting) and will certify the election results. |
| Q: | Can other matters be decided at the 2024 Annual Meeting? |
| A: | As of the date of this Proxy Statement, we are not aware of any business to be brought before the 2024 Annual Meeting, other than the matters described in our Notice of Annual Meeting of Stockholders. If any other matters properly come before the 2024 Annual Meeting, the named proxies will vote in accordance with their best judgment. |
| Q: | Who can attend the meeting? |
| A: | The 2024 Annual Meeting is open to SunCoke Energy stockholders of record. |
| Q: | How can I attend the Annual Meeting? |
| A: | The 2024 Annual Meeting will be a virtual-only meeting of stockholders, conducted exclusively by live audio webcast. No physical meeting will be held. You are entitled to participate in the 2024 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 the 2024 Annual Meeting. 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 Meeting Center ID for the meeting is https://meetnow.global/MCHDMWX. You will be able to attend the Annual Meeting online and submit your questions during the meeting by visiting https://meetnow.global/MCHDMWX. You also will be able to vote your shares online by attending the 2024 Annual Meeting by webcast. 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 for attending the 2024 Annual Meeting via live audio webcast, you will not be able to participate online.
The online meeting will begin promptly at 8:30 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.
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 61
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
| Q: | How do I register to attend the Annual Meeting virtually on the Internet? |
| A: | If you are a registered shareholder (i.e., you hold your shares through our transfer agent, Computershare), you do not need to register to attend the 2024 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 2024 Annual Meeting virtually on the Internet. To register to attend the 2024 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 May 13, 2024 (i.e., three business days in advance of the meeting). Requests for registration should be directed to Computershare at the following:
• 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 43006 |
Providence, RI 02940-3006 |
You will receive a confirmation of your registration by e-mail after Computershare receives your registration materials.
| Q: | What if I have technical difficulties or trouble accessing the virtual meeting website? |
| A: | The virtual meeting platform is fully supported across browsers (MS Edge, Firefox, Chrome and Safari) 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 not a supported browser. 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 1-855-879-4044 for technical assistance. |
| Q: | Why are you holding a virtual meeting instead of a physical meeting? |
| A: | 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. |
| Q: | How do I submit questions or comments for the Annual Meeting? |
| A: | Stockholders can submit questions or comments online during the Annual Meeting via live audio webcast by visiting https://meetnow.global/MCHDMWX. 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 and therefore will not be presented. If we receive substantially similar questions, we may group those questions together and provide a single response to avoid repetition. |
62 SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
| Q: | Who will pay for the cost of proxy preparation and solicitation of proxies? |
| A: | 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 their names that are beneficially owned by others to 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, 333 Ludlow Street – 5th Floor, South Tower, Stamford, Connecticut 06902, a proxy solicitation firm, to assist us in soliciting proxies for a fee of $10,500,000, plus reasonable out-of-pocket expenses for proxy solicitation services. |
| Q: | What happens if the meeting is postponed or adjourned? |
| A: | If the 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 change or revoke your proxy until it is voted. See “Can I change or revoke my vote?” above. |
| Q: | How can I obtain a stockholder list? |
| A: | A list of stockholders entitled to vote at the 2024 Annual Meeting will be available electronically for examination during the 2024 Annual Meeting at https://meetnow.global/MCHDMWX. |
| Q: | How may I obtain a copy of the Company’s 2023 Annual Report on Form 10-K? |
| A: | A copy of our 2023 Annual Report on Form 10-K for the fiscal year ended December 31, 2023, 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 soliciting materials. You also may obtain a copy of our 2023 Annual Report on Form 10-K without charge by writing to: SunCoke Energy, Inc., 1011 Warrenville Road – Suite 600, Lisle, Illinois 60532, Attn: Investor Relations. Our 2023 Annual Report on Form 10-K also is available free of charge through our website at www.SunCoke.com, and the SEC’s website at www.sec.gov. |
IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 16, 2024:
This Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2023 are available in the “Investor Relations” section of our website at the following internet address: http://www.SunCoke.com
SUNCOKE ENERGY, INC. 2024 PROXY STATEMENT 63
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
OTHER INFORMATION
Equity Compensation Plan Information
The following table provides information as of December 31, 20172023 regarding the number of shares of our common stock that may be issued under the LTPEP and the Retainer StockOmnibus 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 | ||||||||||||||||||||||||
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Equity compensation plans not approved by security holders | — | — | — | ||||||||||||||||||||||||
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Total | 4,054,058 | $15.29 | 1,751,036(3) | ||||||||||||||||||||||||
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| (1) | Weighted-average exercise price of outstanding stock options (excludes |
| (2) | Includes |
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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,2022 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 2022 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.
In order for a stockholder proposal to be considered for inclusion in our proxy materials for the 20192025 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, 201827, 2024, 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 2025 Annual Meeting, other than Rule14a-8 proposals described above, written notice must be delivered no earlier than the close of business on January 3, 201916, 2025 and no later than the close of business on February 4, 201915, 2025 to our Corporate Secretary at SunCoke Energy, Inc., 1011 Warrenville Road, Suite 600, Lisle, Illinois 60532.
| Proposal One | The Board & Committees | Corporate Governance | Director Compensation | Executive Compensation | Proposal Two | Proposal Three | Beneficial Stock Ownership | Audit Committee Matters | Proposal Four | Q&A | Other Information | |||||||||||
In addition to satisfying the foregoing requirements, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director-nominees other than the Company’s nominees must provide written notice to the Company’s Secretary no later than March 17, 2025, which is 60 calendar days prior to the anniversary of this year’s meeting date. Such notice must comply with the requirements set forth in the Company’s Amended and Restated By-laws and Rule 14a-19 of the Exchange Act, as applicable.
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,333 Ludlow Street — 5th Floor, South Tower, Stamford, Connecticut 06902, to assist us in the solicitation of proxies for an estimated fee of $9,500,$10,500, plus reimbursement of certainout-of-pocket expenses.
By order of the Board of Directors,
John J. DiRocco, Jr.
Vice President, Assistant General Counsel and Corporate Secretary
Lisle, Illinois
March 21, 2018
EXHIBIT A27, 2024
SUNCOKE ENERGY, INC.
LONG-TERM PERFORMANCE ENHANCEMENT PLAN
(Amended and Restated Effective as of February 14, 2018) 2024 PROXY STATEMENT 65
ARTICLE I
AMENDMENT AND RESTATEMENT
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
PURPOSE
The purposes 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 ownership in the Company; (c) provide competitive compensation opportunities that can be realized through attainment of performance goals; and (d) provide an incentive to Key Employees for continued service with the Company.
ARTICLE III
DEFINITIONS
As used in this Plan, the following terms shall have 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 terms of the Plan.
3.3 “Board of Directors” means the Board of Directors 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 case 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 members of the Board of Directors, each of whom shall meet applicable requirements set forth 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, no act, or failure to act, on the part of the Participant shall 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 Award under the Plan.
3.18 “Plan” means this SunCoke Energy, Inc. Long-Term Performance Enhancement Plan, as amended from time to time.
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 AGREEMENTS
4.1Term of the Plan.No Awards shall be made under this Plan after February 14, 2028.The Plan and all Awards made under 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 terms of such Awards.
4.2Administration.The Plan shall be administered by the Committee, which shall have the authority, in its sole discretion and 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 of the following:
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4.4 Shares Under Awards.
(a) The maximum number of shares of Common Stock that may be delivered to Participants and their beneficiaries under the Plan shall be the sum of (i) the number of shares of Common Stock that 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) Awards in the form of Share Units 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, shall 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 increase the number of shares available under the Plan. If
there is a lapse, forfeiture, expiration, termination or cancellation 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 conditions 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 or to be granted to such Participant shall be forfeited and cancelled.
(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 UNITS
6.1Award of Share Units. The Committee, from time to time, and subject to the provisions 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 conditions of the Share Units, in an amount in cash, shares of Common Stock or both. At the time it authorizes the grant of any Share Units, the Committee shall condition the vesting of the Share Units upon (a) continued service of the applicable Participant and/or (b) the attainment of performance goals. Settlement of Share Units shall be made either in shares of Common Stock, or in cash, at the sole discretion of the Committee. The medium of payment shall be set forth 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, 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 Company would have paid to such holder had he, on 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 settlement of the Share Units with respect to which the dividend equivalents relate.
ARTICLE VII
RESTRICTED STOCK
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 Agreements. 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 time 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 payment of any cash dividends will correspond to the vesting of the Restricted Stock with respect to which such dividends relate. If so determined 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 vesting of the underlying Restricted Stock, and (b) subject to any adjustment pursuant to Section 9.7, dividends payable in Common Stock shall be paid in the form of Restricted Stock, held subject to the vesting of the underlying Restricted Stock.
ARTICLE VIII
SARs
8.1Award of Options.The Committee, from time to time, and subject to the provisions of the Plan and such other terms and conditions as the Committee may prescribe, may grant to any Participant one or more SARs, which upon exercise entitles the Participant 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 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.
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 shall be entitled to make such rules, regulations and determinations as it deems appropriate under the Plan in respect of any leave of absence taken by the
recipient of any Award. Without limiting the generality 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 governed by the laws of the State of Delaware.
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THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
Proposals – The Board of Directors recommends | ||||||||||||||||||||
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01 - Ralph M. Della Ratta, Jr.
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2. To hold a non-binding advisory vote to approve the compensation of the Company’s named executive officers (“Say-on-Pay”). | ☐ | ☐ | ☐ | |||||||||||||||||
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4. To ratify the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, | ||||||||||||||||||||
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3. To hold a non-binding advisory vote to approve the frequency of future advisory votes on executive compensation |
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The 2024 Annual Meeting of Stockholders of SunCoke Energy, Inc. will be held on
Thursday, May 16, 2024 at 8:30 a.m. Central Time, virtually via the Internet at meetnow.global/MCHDMWX.
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.
Important Notice Regardingnotice regarding the Availabilityavailability of Proxy Materialsproxy materials for the Annual Meeting:annual meeting:
The Notice of Annual Meeting and Proxy Statement and Annual Report on Form 10-K areproxy statement is available electronically at
www.proxyvote.com. www.envisionreports.com/sxc
E39904-P01629
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q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q
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Proxy – SunCoke Energy, Inc. | ||
(If you noted any Address Changes/Comments above, please mark corresponding boxThis proxy is solicited on behalf of the reverse side.)Board of Directors for the Annual Meeting of Stockholders on May 16, 2024
ContinuedThe undersigned hereby appoints Katherine T. Gates and Mark W. Marinko, and each of them as attorney-in-fact, agent and proxy 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 16, 2024, at 8:30 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 signed on reverse sideentitled to vote.
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, 2 AND 4 AND FOR “1 YEAR” ON PROPOSAL 3, 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.