Terry Fedor

About Terry Fedor

Terry Fedor is Executive Vice President, Operations at Cleveland-Cliffs, age 60, serving in his current role since October 2022 after multiple senior operations leadership roles since February 2019 . He oversees integrated steelmaking operations across CLF’s footprint, where performance incentives emphasize Adjusted EBITDA, safety (TRIR), and strategic initiatives annually, and relative TSR over three-year cycles for long-term equity; notably, 2024 annual incentives funded at 20% and the 2022–2024 LTI cycle paid 0% on below-threshold relative TSR, signaling tight pay-for-performance alignment . CLF’s recent performance context includes 2023 revenues of $22 billion and Adjusted EBITDA of $1.9 billion, while 2024 delivered the company’s safest year with TRIR of 0.9 and a >26% improvement YoY .

Past Roles

Fixed Compensation

• No individual base salary or bonus figures for Terry Fedor are disclosed; CLF does not offer employment agreements for executive officers, indicating at-will status and a standardized compensation governance framework .
• Executive share ownership guidelines require Executive/Senior Vice Presidents to hold shares equal to 3x base salary over five years; guidelines enforce retention via 50% net-profit-share hold until compliance .
• Hedging and pledging of company stock by officers is prohibited, reducing misalignment and margin-call risk; CLF states none of directors or executive officers have pledged CLF shares .

Performance Compensation

• CLF’s Executive Management Performance Incentive (EMPI) annual plan weighting and targets (apply to executive officers, including EVPs):
  • 50% Adjusted EBITDA (2024 threshold $1.4B, target $1.7B, max $2.0B; actual $780M → 0%)
  • 10% Safety Scorecard (TRIR improvement; 2024 achieved 200% for safety metric, weighted to 20%)
  • 40% Strategic Initiatives (achieved at target, then reset to 0% via negative discretion)

• Long-Term Incentive (LTI) structure (applies broadly to executives): 34% performance cash, 33% performance shares, 33% RSUs; three-year performance period on relative TSR vs S&P Metals & Mining constituents (payout 0–200%), RSUs three-year cliff vesting near Dec 31 .
• Outcome signal: 2022–2024 LTI performance awards paid 0% with relative TSR at the 9.6th percentile, reinforcing long-term alignment and downside participation .

Equity Ownership & Alignment

• Stock ownership guidelines: EVP/Senior VP at 3x base salary; compliance enforced via net-profit-share holding policy (50% hold until guideline met) .
• Prohibited transactions: no hedging or pledging by officers; company states no pledges by directors or executive officers, reducing forced selling risk .
• Individual ownership breakdown for Terry Fedor is not disclosed in proxy ownership tables; executives as a group (17 persons) owned ~1.71% of outstanding shares as of March 17, 2025 .

Employment Terms

• No employment agreements for executive officers; compensation structures and severance are committee-governed rather than contractually guaranteed .
• Indemnification: CLF has indemnification agreements with all officers (including EVPs), covering expenses and liabilities to the fullest extent of Ohio law, with a trust agreement to support enforcement rights .
• Change-in-control: detailed CIC severance terms are disclosed for NEOs only (CEO 3x; other NEOs 2x salary+target bonus, COBRA benefits, pension enhancements, outplacement; double-trigger vesting and covenants); CIC terms for non-NEO EVP officers like Fedor are not specifically disclosed .
• Clawback: NYSE-compliant clawback policy applies to executive officers for incentive compensation .

Related Party Transactions (Governance Watch)

• Morgan Engineering Systems, Inc., owned by Mark Fedor (Terry’s brother), was engaged by CLF subsidiaries on arm’s-length terms; payments were $5.3 million in 2024 and $7.3 million in 2023; Terry Fedor abstained from any actions related to Morgan Engineering; transactions approved by CEO, Chief Legal Officer, and Audit Committee per RPT Policy .

Performance & Context Signals

Compensation Structure Analysis

• Mix shift: LTI dominated by performance cash/shares and time-based RSUs; option use minimal, indicating lower leverage and reduced repricing risk .
• Rigorous targets and discretion: 2024 Adjusted EBITDA target set at $1.7B with below-threshold performance and committee discretion to zero out strategic initiatives, compressing payouts—evidence of committee willingness to align pay with shareholder experience .
• Governance best practices: double-trigger CIC vesting, clawbacks, no employment agreements, no tax gross-ups; insider trading policy bans hedging/pledging .

Say-on-Pay & Shareholder Feedback

• Say-on-Pay approval: ~93% in 2023 and ~75% in 2024; compensation committee incorporated feedback and applied negative discretion in 2024 strategic payouts to better mirror shareholder outcomes .

Investment Implications

• Pay-for-performance alignment: Low 2024 EMPI funding (20%) and zero 2022–2024 LTI payout on relative TSR underscore incentive downside, reducing overpayment risk through cycles .
• Selling pressure risk: Hedging/pledging prohibitions and ownership guidelines reduce forced-sale and misalignment risks; lack of individual disclosure for Fedor’s holdings limits precision but officers as a group hold ~1.71% .
• Retention: Three-year cliff RSU vesting and recurring LTI cycles support retention; absence of employment agreements means retention levers are incentive-based rather than contractual .
• Governance red flag mitigated: Related party transactions involving Morgan Engineering are transparently disclosed with abstention and Audit Committee oversight; monitor continuity and scope given familial ties .
• Performance execution: Safety excellence (TRIR 0.9, >26% improvement) and disciplined incentive outcomes point to operational focus; however, EBITDA shortfall and zero relative TSR payout highlight cyclicality and competitive pressures that may challenge long-term value creation under current market conditions .