Exhibit 10.28

SunCoke Energy, Inc. Annual Incentive Plan

This SunCoke Energy, Inc. Annual Incentive Plan (the “AIP”) is hereby
established by SunCoke Energy, Inc. (“SunCoke”) and, together with the SunCoke
Energy, Inc. Senior Executive Incentive Plan (the “SEIP”), governs the annual
incentive bonuses paid to Eligible Employees for services on and after
January 1, 2013.

Eligibility

The AIP applies to “Eligible Employees” of SunCoke Technology and Development
LLC, SunCoke Energy Jewell Coal & Coke Company, Jewell Smokeless Coal
Corporation, Dominion Coal Corporation, Indiana Harbor Coke Company, Haverhill
North Coke Company, Gateway Energy & Coke Company, Middletown Coke Company and
any other affiliates approved by the Compensation Committee of the SunCoke Board
of Directors (the “Compensation Committee”). “Eligible Employees” means
non-union, active employees of SunCoke or its participating affiliates who are
engaged in permanent, full-time salaried or hourly employment and who are either
(i) at a director/general manager level or above or (ii) below the level of
director/general manager and whose annual participation in the AIP is approved
by the Chief Executive Officer of SunCoke (the “CEO”) in his sole discretion. A
full-time employee is an employee who is regularly scheduled to work thirty or
more hours per week.

Administration of the AIP

The AIP shall be administered by (i) the Compensation Committee in the case of
the Eligible Employees who are at a director/general manager level or above, and
(ii) the CEO in the case of all other Eligible Employees (in each case, the
“Administrator”). Each Administrator shall have such duties and powers as may be
necessary to discharge its duties under the AIP with respect to the applicable
Eligible Employees, including, but not by way of limitation, the following:

(a) To construe and interpret the AIP in its absolute discretion and to
determine all questions arising in the administration, interpretation and
application of the AIP (including, without limitation, the discretionary
authority set forth herein). Any such actions, determinations or decisions of
the Administrator shall be conclusive and binding on applicable Eligible
Employees and SunCoke.

(b) To prepare and distribute, in such manner as the Administrator determines to
be appropriate and in accordance with applicable laws, information explaining
the AIP.

(c) To receive from SunCoke, participating affiliates and Eligible Employees
such information as may be necessary for the proper administration of the AIP.

(d) To appoint or employ individuals to assist in the administration of the AIP
and any other agents it deems advisable, including legal counsel.

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None of SunCoke, the members of the Compensation Committee, nor the CEO shall be
liable for any action taken or not taken or decision made or not made in good
faith relating to the AIP or any award thereunder.

Base Amount

A base amount (“Base Amount”) shall be established for each Eligible Employee
with respect to the fiscal year of SunCoke for which the applicable Annual Bonus
is paid (the “Applicable Year”). The Base Amount shall be the product of the
Eligible Employee’s (i) annual base salary as of December 31 of the Applicable
Year, exclusive of benefits, bonuses, equity grants and premium pay, multiplied
by (ii) his or her applicable annual guideline percentage as determined by the
Administrator for such Applicable Year, taking into account any change in annual
guideline percentage that occurs during the Applicable Year, in which case the
guideline percentage will be prorated based on the portion of the year that each
guideline percentage applied.

Calculation of Annual Bonus

For each Applicable Year, the Administrator shall designate in writing (i) other
participating affiliates, if any, (ii) the performance goal(s) to be attained
for such Applicable Year, (iii) the weighting of each performance goal as a
percentage of the Base Amount, (iv) the payout factors for each performance
goal, (v) the maximum payout factor for the Individual Performance Factor, and
(vi) the maximum Annual Bonus (as a percentage of the Base Amount) that can be
paid to an Eligible Employee for the Applicable Year.

At the end of each Applicable Year, each Eligible Employee’s Base Amount will be
increased or decreased depending upon the Company Performance Factor and the
Individual Performance Factor for the Eligible Employee. Subject to the
discretion of the Administrator, set forth under the heading “Administrator
Discretion” below, the Annual Bonus is to be determined as follows:

Company Performance Factor. The “Company Performance Factor” is a weighted
average percentage between 0% and a maximum percentage, determined by the
Administrator after the end of each Applicable Year based on the level of
attainment of each performance goal, the weighting of each such goal and the
payout factor for each such goal.

Individual Performance Factor. The “Individual Performance Factor” is a
percentage between 0% and a maximum percentage established by the Administrator
that is based on the performance of each Eligible Employee during the Applicable
Year. The Individual Performance Factor shall be determined by the Administrator
after the end of each Applicable Year, and shall take into consideration the
overall performance of the Eligible Employee and his or her contribution to the
organization during the Applicable Year.

The Individual Performance Factor is subject to further limitation by the
aggregate pool of funds available for distribution to all Eligible Employees
under the AIP (the “Pool”). The Pool is equal to the product of (i) the sum of
the Base Amount of all Eligible Employees multiplied (ii) by the Company
Performance Factor.

 

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Total Annual Bonus. The Annual Bonus for each Eligible Employee under the AIP
for the Applicable Year is determined by multiplying (i) the product of the
Company Performance Factor and the Individual Performance Factor by (ii) the
Eligible Employee’s Base Amount. In no event shall the total Annual Bonus paid
to any Eligible Employee exceed the maximum amount set by the Administrator for
each Applicable Year.

Except as set forth below under the heading “Proration,” or as otherwise
determined by the Administrator, no Annual Bonus shall be paid to any Eligible
Employee whose employment with the Company or an affiliate terminates for any
reason prior to December 31 of the Applicable Year.

Administrator Discretion

Notwithstanding anything in the AIP to the contrary, the applicable
Administrator may withhold payment of the Annual Bonus or, alternatively, reduce
the amount of the Annual Bonus otherwise payable to any Eligible Employee or any
group of Eligible Employees who work for business or operating units of SunCoke
or any of its affiliates (collectively, an “Eligible Employee Group”) if the
Administrator in its reasonable discretion determines that such Eligible
Employee or Eligible Employee Group has either (i) failed to act in accordance
with acceptable performance standards during such Applicable Year, or (ii) acted
in a manner detrimental to the interests or reputation of SunCoke or any of its
affiliates. Furthermore, the Administrator may, in its reasonable discretion,
redistribute the amount of any such withholding or reduction in whole or in part
to an Eligible Employee or Eligible Employee Group whom the Administrator
reasonably determines has performed in a manner that exceeds expectations during
such Applicable Year, subject to the maximum Annual Bonus limitation set by the
Administrator.

The Administrator may also increase the Amount of the Annual Bonus otherwise
payable to any Eligible Employee or Eligible Employee Group, subject to the
maximum Annual Bonus limitation set by the Administrator; provided, however,
that the Administrator cannot increase the Pool as determined in accordance with
“Calculation of Annual Bonus.”

Proration

Any Eligible Employee hired as of January 1st through March 31st shall receive
his or her Annual Bonus, without proration, for the Applicable Year in which the
date of hire occurs. Any Eligible Employee hired as of April 1st through
September 30th shall be eligible for a prorated portion of his or her Annual
Bonus for the Applicable Year in which the date of hire occurs. Eligible
Employees hired as of October 1st through December 31st shall not be eligible to
receive an Annual Bonus for the Applicable Year in which the date of hire
occurs.

The Annual Bonus will be prorated, as applicable, in the event of an Eligible
Employee’s termination of employment prior to December 31 of an Applicable Year
due to death, permanent disability (as determined under the Company’s long term
disability program) or Retirement. For the purposes of the AIP:

(i) “Retirement” shall mean an Eligible Employee’s termination of employment,
other than for Just Cause, where the Eligible Employee has either (a) attained
age 55 and has provided services to SunCoke or an affiliate for ten years or
more or (b) attained age 60 and has provided services to SunCoke or an affiliate
for five years or more.

 

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(ii) “Just Cause” shall mean 2(a) the willful and continued failure of the
Eligible Employee to substantially perform the Eligible Employee’s duties with
the Company or an affiliate (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 Eligible Employee by the applicable
Administrator (or the Board of Directors in the case of an Eligible Employee
covered by the SEIP) that specifically identifies the manner in which it is
believed that the Eligible Employee has not substantially performed his or her
duties; (b) the Eligible Employee’s conviction of a felony; (c) willful
misconduct by the Eligible Employee in connection with his or her employment
duties or responsibilities to the Company or any affiliate (including, but not
limited to, dishonest or fraudulent acts) that places the Company or any
affiliate at risk of material injury; or (d) the Eligible Employee’s failure to
comply with a policy of the Company or any affiliate that places the Company or
any affiliate at risk of material injury.

Payment of Annual Bonus

The Annual Bonus will be paid on or before March 15th following the end of each
Applicable Year.

AIP Termination and Modification

The AIP may be terminated, amended or modified in any respect at any time, and
from time to time, with respect to the applicable Eligible Employees, at the
Administrator’s sole discretion.

 

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