Keith Koci
CLEVELAND-CLIFFSAbout Keith Koci
Executive Vice President & President, Cleveland-Cliffs Services. Joined Cleveland-Cliffs in February 2019 as EVP & CFO; moved to lead Services with oversight of IT, procurement, logistics, scrap recycling, Tooling & Stamping, Tubular Components, and Cliffs International . Education: BS in Business Administration, University of Illinois–Chicago; Certified Public Accountant since 1986 . Tenure highlights include overseeing finance and later Services during periods of strong operational execution (2023 revenues $22B, Adjusted EBITDA $1.9B) and later a cyclical downturn (2024 Adjusted EBITDA $780M), reflected in incentive outcomes and relative TSR-based LTI payout of 0% for the 2022–2024 cycle .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Cleveland-Cliffs | EVP & President, Cleveland-Cliffs Services | 2021–present | Leads IT, procurement/logistics, scrap recycling, Tooling & Stamping, Tubular Components, Cliffs International; expands raw material portfolio, focusing on domestic scrap |
| Cleveland-Cliffs | EVP & CFO | 2019–2021 | Executive responsibility for Finance, Accounting, Tax, Treasury, Investor Relations; supported capital allocation and strategy |
| Metals USA | SVP & CFO | 2013–2019 | Led finance; previously key player in listing, take-private, IPO, and sale transactions under CEO Goncalves |
| Metals USA | SVP, Business Development | 2006–2013 | Led M&A, capital investments, forecasting, budgeting; implemented SOX controls |
| Metals USA | VP Corporate Controller; Director of Budgeting; Regional Controller (Flat Rolled) | 1998–2005 | Built finance infrastructure, budgeting, controllership |
External Roles
No public company directorships disclosed; primary career roles at Cleveland-Cliffs and Metals USA .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $683,000 | $710,000 | $738,000 |
| Target Bonus (% of salary) | 120% | 120% | 120% |
| EMPI Actual Payout ($) | $555,689 | $1,609,428 | $177,120 |
| Stock Awards ($, grant-date fair value) | $2,167,293 | $2,984,710 | $2,884,320 |
Performance Compensation
| Component | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Annual Incentive – Adjusted EBITDA | 50% | $1.7B target; $1.4B threshold; $2.0B max | $780M | 0% (below threshold) | Cash paid Feb following year |
| Annual Incentive – Safety (TRIR improvement) | 10% | 5% improvement vs prior year | 26.2% improvement | 200% metric payout; Committee set total plan funding to 20% | Cash |
| Annual Incentive – Strategic Initiatives | 40% | Multiple qualitative initiatives (capital returns, brand leadership, hydrogen trials, DOE projects, transformer plant) | Achieved; negative discretion applied | Reset to 0% by Committee | Cash |
| LTI – Performance Cash | 34% of LTI | Relative TSR: 25th/50th/75th percentile = 50%/100%/200% payout | 2022–2024 cycle TSR at 9.6th percentile | 0% (below threshold) | 3-year performance; pays early next year |
| LTI – Performance Shares (PSUs) | 33% of LTI | 57,802 target PSUs granted in 2024 | 2022–2024 cycle below threshold | 0% payout for 2022–2024 cycle | 3-year performance, cliff |
| LTI – RSUs (time-based) | 33% of LTI | 57,802 RSUs granted in 2024 | Time-based service | Vest on 12/31/2026 | 3-year cliff |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (as of Mar 17, 2025) | 325,541 shares; no shares pledged |
| Direct vs RSUs | 285,461 shares owned directly; 160,795 RSUs counted for ownership guideline |
| Executive Share Ownership Guideline | EVP/SVP: 3x base salary; must hold 50% of net shares until compliant |
| Compliance status (value basis) | Koci at ~9.5x base salary; total share value $7,046,382 (one-year avg price basis) vs required $2,214,000 |
| Hedging/pledging policy | Hedging and pledging prohibited for officers |
Employment Terms
| Provision | Status/Terms |
|---|---|
| Employment agreement | Company does not offer employment agreements to executive officers |
| Change-in-control vesting | Double-trigger for equity awards |
| Clawback | NYSE-compliant incentive compensation clawback policy |
| Tax gross-ups | No excise tax gross-ups on CIC payments |
| Potential payout – CIC and other scenarios (as of 12/31/2024) | Termination without cause after CIC: total $9,812,100, including Cash Severance $3,247,200; Non-Equity Incentive $3,101,000; Equity $2,171,600; Retirement Benefits $723,100; NQDC $491,000; Other $78,200 |
Deferred Compensation and Pension
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| NQDC – Executive contributions ($) | $70,654 | — | $95,231 |
| NQDC – Registrant contributions ($) | $15,120 | $15,720 | $15,720 |
| NQDC – Year-end balance ($) | $275,962 | $490,967 | $490,967 |
| Pension Plan – Present value ($) | — | — | $150,600 |
| SERP – Present value ($) | — | — | $459,200 |
Compensation Structure Analysis
- Mix and risk: Significant at-risk pay via EMPI and TSR-based LTI; RSUs are retention-oriented and vest on three-year cliff .
- Year-over-year outcomes: EMPI paid below target in 2022 (67.8%), above max in 2023 (188.9%), and at 20% in 2024 due to EBITDA miss and negative discretion on strategy, despite safety outperformance .
- LTI discipline: Relative TSR metric yielded 0% payout for the 2022–2024 cycle, aligning realized pay with shareholder returns in a weak steel pricing environment .
- Governance protections: Double-trigger CIC equity, clawback, no tax gross-ups, no employment agreements; hedging/pledging prohibited .
Performance & Track Record
- Company performance under Koci’s executive tenure: 2023 revenue $22B, Adjusted EBITDA $1.9B; record shipments and cost reductions; share repurchases; liquidity $4.5B . In 2024, Adjusted EBITDA fell to $780M amid steel cycle pressure; management applied negative discretion to strategic initiatives payouts to reflect shareholder experience .
- TSR-linked LTI result: 0% for the 2022–2024 performance period (9.6th percentile relative TSR), reinforcing pay-for-performance linkage .
Say-on-Pay & Shareholder Feedback
- Say-on-Pay support fell to ~75% in 2024 from 93% in 2023; Committee cited rigorous targets and aligned negative discretion in 2024 .
- Engagement: Outreach to top 25 shareholders; feedback incorporated into compensation design .
Expertise & Qualifications
- Finance/M&A operator with deep metals industry experience; CPA since 1986; led Services and Finance organizations at CLF .
Work History & Career Trajectory
| Organization | Role | Years | Notable |
|---|---|---|---|
| Cleveland-Cliffs | EVP & President, Services | 2021–present | Oversight of downstream segments, scrap, IT/procurement/logistics |
| Cleveland-Cliffs | EVP & CFO | 2019–2021 | Led finance functions and investor relations |
| Metals USA | SVP & CFO | 2013–2019 | Finance leadership through strategic transactions |
| Metals USA | SVP Business Development; Controller/Budgeting roles | 1998–2013 | M&A, capital investments; SOX implementation |
Equity Plan & Peer Benchmarking
- Compensation comparator group: 18 large industrials (includes Nucor, Steel Dynamics, U.S. Steel, ILMN/ITW/Parker-Hannifin/PPG, etc.); target pay positioned above market median on average to attract/retain talent .
- LTI comparator group for TSR: 32 constituents of SPDR S&P Metals & Mining ETF (ex-CLF) .
Risk Indicators & Red Flags
- Shares not pledged; hedging/pledging prohibited .
- No repricing or tax gross-ups; executive clawbacks in place .
- 2024 Say-on-Pay at ~75% indicates increased scrutiny vs 2023 .
Investment Implications
- Alignment: Koci’s pay outcomes demonstrate strong pay-for-performance—EMPI variability and 0% LTI payout for weak TSR cycle—reducing agency risk. High personal ownership (~9.5x salary) and no pledging further align incentives .
- Retention and incentives: Double-trigger CIC protections and sizable potential severance ($9.8M in a CIC termination) provide retention incentives but are standard for peers; lack of employment contracts offers board flexibility .
- Near-term selling pressure: RSU cliff vesting (12/31/2026 for 2024 grants) and ongoing EMPI cash payouts suggest limited forced selling; insider policy prohibits hedging/pledging . Overall, compensation design emphasizes long-term TSR outperformance and safety, with discretion used to mirror shareholder experience.