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                                                                     EXHIBIT 4.5

                           GENEVA STEEL HOLDINGS CORP.
                             2001 STOCK OPTION PLAN

        1. PURPOSE. The Geneva Steel Holdings Corp. 2001 Stock Option Plan (the
"Option Plan") is adopted under the Third Amended Plan of Reorganization of
Geneva Steel Company, as modified.

        2. TYPES OF AWARDS. Awards under the Option Plan are limited to options
("Stock Options") to purchase common stock, $.01 par value per share ("Stock"),
of Geneva Steel Holdings Corp. (the "Company").

        3. ADMINISTRATION.

                3.1. The Option Plan shall be administered by the Compensation
Committee of the Company's Board of Directors (the "Board") or such other
committee of directors as the Board designates (the "Committee"). The Committee
shall consist of not less than two directors neither of whom is an employee of
the Company or a subsidiary or affiliate of the Company (a "Related Company").
The members of the Committee shall serve at the pleasure of the Board.

                3.2. The Committee shall have the following authority under the
Option Plan: to grant Stock Options to persons eligible to receive them under
the Option Plan; to adopt, alter and repeal such administrative rules,
guidelines and practices governing the Option Plan as it shall deem advisable;
to interpret the terms and provisions of the Option Plan; and otherwise to
supervise the administration of the Option Plan.

                3.3. Awards granted under this Option Plan shall be evidenced by
a written agreement between the Company and the award recipient.

        4. STOCK SUBJECT TO THE OPTION PLAN.

                4.1. The total number of shares of Stock with respect to which
Stock Options may be granted under this Option Plan shall be 418,349, subject to
adjustment as provided below and the related option agreement. Such shares may
consist of authorized but unissued shares or treasury shares.

                4.2. In the event of any merger, reorganization, consolidation,
sale of substantially all assets, recapitalization, stock dividend, stock split,
spin-oft split-up, split-off distribution of assets or other change in corporate
structure affecting the Stock, a substitution or adjustment, as determined by
the Committee under this Option Plan and the related option agreement, shall be
made in the aggregate number of shares reserved for issuance under the Option
Plan, the number and type of shares subject to outstanding awards and the
amounts to be paid by award holders or the Company, as the case may be, with
respect to outstanding awards provided that no such adjustment shall increase
the aggregate value of any outstanding award.

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        5. ELIGIBILITY

                5.1. Each of Joseph A. Cannon, Ken C. Johnsen, Tim Clark, Carl
E. Ramnitz, Dennis Wanlass and Marcus Phillips are the sole participants under
the Option Plan.

        6. STOCK OPTIONS

                6.1. The Stock Options granted under the Option Plan shall be
non-qualified stock options (i.e., shall not constitute incentive stock options
qualifying under section 422 of the Internal Revenue Code), and shall be granted
in satisfaction of the Company's obligations pursuant to Section 6.12 of the
Third Amended Plan of Reorganization of Geneva Steel Company, as modified.

                6.2. Subject to the following provisions, Stock Options awarded
under the Option Plan shall be in such form and shall have such terms and
conditions as is provided in the related option agreement:

                        (a) Option Price. The option price per share of Stock
purchasable under a Stock Option shall be $2.0359.

                        (b) Option Term. The term of each Stock Option shall
expire ten (10) years from the date each Stock Option becomes exercisable,
subject to earlier expiration upon termination of the optionee's employment for
"cause" (as defined below).

                        (c) Exercisability. Stock Options shall become
exercisable with respect to twenty-five percent (25%) of the number of shares
subject to the option upon the date of grant, and with respect to an additional
twenty-five percent (25%) on each of the first three anniversaries of the date
of grant, provided the option shall be exercisable in full upon the death or
disability of the optionee, upon a "Change of Control" of the Company (as
defined in the Term Loan Agreement, dated as of January 3, 2001, among Geneva
Steel LLC, as borrower, Citicorp USA, Inc., as agent on behalf of the lenders
thereto, and the other lenders named therein), or upon a termination of the
optionee's employment with the Company other than for "cause". For purposes of
this Section 6.2(c), a termination of optionee's employment shall mean (i) a
discharge from employment, (ii) a reduction in compensation, (iii) the
assignment of the optionee to duties inconsistent in any material respect with
the optionee's position, authority, duties or responsibilities, or (iv)
requiring optionee to be based at any office or location that is over
seventy-five (75) miles from Vineyard, Utah; and "cause" shall be deemed to
exist where (v) optionee is convicted of a felony, a crime involving moral
turpitude, or a crime involving the Company or any Related Company (other than
pursuant to actions taken at the direction of or with the approval of the Board
or of the board of directors or managers, as applicable, of any Related
Company), (vi) the Company has made a good-faith determination that the optionee
has engaged in (A) willful misconduct, (B) willful or gross negligence, (C)
fraud, (D) misappropriation, or (E) embezzlement in the performance of his
duties, or (vii) optionee has willfully and repeatedly failed to discharge his
duties as an employee of the Company or a Related Company. The Committee may
waive such exercise provisions or accelerate the exercisability of the Stock
Option at any time in whole or in part.

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                (d) Method of Exercise. Stock Options may be exercised in whole
or in part at any time during the option period by giving written notice of
exercise to the Company specifying the number of shares to be purchased,
accompanied by payment of the purchase price. Payment of the purchase price
shall be made in the discretion of optionee, (i) in cash (including cash
equivalents), (ii) by delivery of shares of Stock already owned by the optionee
for at least six (6) months, (iii) by a broker-assisted "cashless exercise"
effected in accordance with rules adopted by the Committee and reasonably
acceptable to optionee or (iv) any combination of the foregoing.

                (e) No Stockholder Rights. An optionee shall not have rights to
dividends or other rights of a stockholder with respect to shares subject to a
Stock Option until the optionee has given written notice of exercise and has
paid for such shares.

                (f) Surrender Rights. The Committee may provide that Stock
Options may be surrendered for cash upon any terms and conditions set by the
Committee.

                (g) Transferability of Options. (i) Options and all other rights
thereunder may be assigned or transferred for consideration by an optionee one
time only. After such transfer for consideration, Stock Options and all other
rights thereunder shall not be further transferable or assignable. Stock Options
may be exercised or surrendered during the optionee's lifetime only by him or
his guardian or legal representative. The estate of a deceased holder of a Stock
Option may be permitted to exercise such Stock Option.

                (ii) Notwithstanding the foregoing, the Committee may in the
applicable option certificate or at any time after the date of grant by an
instrument amending terms provided for in the option certificate provide
that Stock Options may be transferred by a holder without consideration, subject
to such rules as the Committee may adopt consistent with the terms of the
applicable option certificate to preserve the purposes of the Option Plan, to;

                         (A) any person who is a "family member" of the holder,
                             as such term is used in the instructions to Form
                             S-8 (collectively, the "Immediate Family Members");

                         (B) a trust solely for the benefit of the holder and
                             his or her Immediate Family Members;

                         (C) a partnership or limited liability company whose
                             only partners or shareholders are the holder and
                             his or her Immediate Family Members; or

                         (D) any other transferee as may be approved either (a)
                             by the Board of Directors or the Committee in its
                             sole discretion, or (b) as provided in the terms of
                             the applicable option certificate;

(each transferee described in sections g (i) and in clauses (A),(B),(C), and (D)
above is hereinafter referred to as a "Permitted Transferee"); PROVIDED that the
holder gives the Committee advance written notice describing the terms and
conditions of the proposed transfer and the Committee notifies the holder in
writing that such a transfer would comply with the requirements of the Plan and
the terms of any applicable option certificate.

                (iii) The terms of any Stock Option transferred in accordance
with sections g (i) and g (ii) shall apply to the Permitted Transferee and any
reference in the Option Plan or in an option certificate to a holder shall be
deemed to refer to the Permitted Transferee, except that (a) Permitted
Tranferees shall not be entitled to transfer any Stock Options, other than by
will or the laws of descent and distribution; (b) Permitted Transferees shall
not be entitled to exercise any transferred Stock Options unless there shall be
in effect a registration statement on an appropriate form covering the shares
to be acquired pursuant to the exercise of such Stock Option if the Committee
determines, consistent with the terms of any applicable option certificate,
that such a registration statement is necessary or appropriate, (c) the
Committee or the Company shall not be required to provide any notice to a
Permitted Transferee, whether or not such notice is or would otherwise have
been required to be given to the holder under the Option Plan or otherwise, and
(d) the consequences of termination of the holder's employment by, or services
to, the Company or a Related Company under the terms of the Option Plan and the
applicable option certificate shall continue to be applied with respect to the
holder, following which the Stock Options shall be exercisable by the Permitted
Transferee only to the extent, and for the periods, specified in the Option
Plan and the terms of the applicable option certificate.

                (h) Termination of Service. Following the termination of an
optionee's service with the Company or a Related Company, the Stock Option shall
continue to be exercisable to the extent provided in the related option
agreement.

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        7. LOANS.

                The Committee may provide that the Company shall make, or
arrange for, a loan or loans with respect to the exercise of any Stock Option
awarded under the Plan or with respect to any taxes arising from an award
hereunder; provided, however, that the Company shall not loan more than the sum
of (i) the excess of the purchase or exercise price of an award over the par
value of any shares of Stock awarded plus (ii) the amount of any taxes arising
from such award. The Committee shall have full authority to decide whether a
loan will be made hereunder and to determine the amount, term and provisions of
any such loan, including the interest rate to be charged, whether the loan will
be with or without recourse against the borrower, any security for the loan, the
terms on which the loan is to be repaid and the conditions, if any, under which
the loan may be forgiven.

        8. TAX WITHHOLDING.

                8.1. Each optionee shall, no later than the date as of which the
value of an award first becomes includable in such person's gross income for
applicable tax purposes, pay to the Company, or make arrangements satisfactory
to the Committee regarding payment of, any federal, state, local or other taxes
of any kind required by law to be withheld with respect to the award. The
obligations of the Company under the Option Plan shall be conditional on such
payment or arrangements, and the Company (and, where applicable, any Related
Company), shall, to the extent permitted by law, have the right to deduct any
such taxes from any payment of any kind otherwise due to the employee.

                8.2. To the extent permitted by the Committee, and subject to
such terms and conditions as the Committee may provide, an employee may elect to
have the withholding tax obligation, or any additional tax obligation with
respect to any awards hereunder, satisfied by (i) having the Company withhold
shares of Stock otherwise deliverable to such person with respect to the award
or (ii) delivering to the Company shares of unrestricted Stock previously owned
by the person for at least six (6) months.

        9. AMENDMENTS AND TERMINATION. The Board may amend the Option Plan from
time to time, provided no amendment of the Option Plan shall adversely affect
any Stock Option previously granted without the optionee's written consent.

        10. GENERAL PROVISIONS.

                10.1. Each award under the Option Plan shall be subject to the
requirement that, if at any time the Committee shall determine that (i) the
listing, registration or qualification of the Stock subject or related thereto
upon any securities exchange or under any state or federal law, or (ii) the
consent or approval of any government regulatory body or (iii) an agreement by
the recipient of an award with respect to the disposition of Stock is necessary
or desirable (in connection with any requirement or interpretation of any
federal or state securities law, rule or regulation) as a condition of, or in
connection with, the granting of such award or the issuance, purchase or
delivery of Stock thereunder, such award shall not be granted or exercised, 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.

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                10.2. Nothing set forth in this Option Plan shall prevent the
Board from adopting other or additional compensation arrangements.

                10.3. No member of the Board or the Committee, nor any officer
or employee of the Company acting on behalf of the Board or the Committee, shall
be personally liable for any action, determination or interpretation taken or
made with respect to the Option Plan, and all members of the Board or the
Committee and all officers or employees of the Company acting on their behalf
shall, to the extent permitted by law, be fully indemnified and protected by the
Company in respect of any such action, determination or interpretation.

        11. EFFECTIVE DATE OF THE OPTION PLAN. The Option Plan shall be
effective as of January 3, 2001.

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                                                                     EXHIBIT 4.6

                    FORM OF OPTION TO PURCHASE COMMON STOCK
                         OF GENEVA STEEL HOLDINGS CORP.

                This certifies that, for value received, _______________________
("Executive") is hereby granted an option to purchase from Geneva Steel Holdings
Corp., a Delaware corporation (the "Company"), _______ shares of common stock of
the Company, upon the terms and subject to the conditions set forth below (the
"Option"). The Option is granted under the Geneva Steel Holdings Corp. 2001
Stock Option Plan (the "Option Plan") and is granted in satisfaction of the
Company's obligations in Section 6.12 of the Third Amended Plan of
Reorganization of Geneva Steel Company, as modified (the "Reorganization Plan").

        1. Definitions. For purposes of this Option Agreement, except as
otherwise provided or unless the context otherwise requires, all capitalized
terms not otherwise defined have the meanings ascribed to them in this Section
1. Whenever the context requires, such terms shall include the plural number as
well as the singular.

        "Business Day" means any day except Saturday, Sunday and any other day
on which commercial banks in Salt Lake City, Utah are authorized by law to
close, except that for the purpose of Section 5, "Business Day" means any day
other than a Saturday, Sunday and any day on which the Common Stock is not
traded on an exchange or in a market.

        "Cause" means circumstances where the Executive (i) is convicted of a
felony, a crime of moral turpitude or any crime involving the Company or its
subsidiaries (other than pursuant to actions taken at the direction or with the
approval of the Board of Directors of the Company or board of directors or
managing board of any subsidiary), (ii) is found by reasonable determination of
the Company, made in good faith, to have engaged in (A) willful misconduct, (B)
willful or gross neglect, (C) fraud, (D) misappropriation or (E) embezzlement in
the performance of his duties or (iii) willfully and repeatedly fails to
discharge his duties as an employee of the Company or its subsidiaries.

        "Change of Control" means a Change of Control as defined in the Term
Loan Agreement, dated as of January 3, 2001, among Geneva Steel LLC, as
borrower, Citicorp USA, Inc., as agent on behalf of the lenders thereto, and the
other lenders named therein.

        "Common Stock" means the common stock of the Company, par value, $.01
per share, or any other class of stock resulting from successive changes or
reclassifications of the Common Stock.

        "Company" is defined in the introductory paragraph.

        "Control" means, with respect to any Person, the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities or other beneficial interest, or by contract
or otherwise.

        "Effective Date" means the date the Reorganization Plan becomes
effective.

        "Executive" is defined in the introductory paragraph.

        "Exercise Price" is defined in Section 4(d).

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        "Expiration Date" means, with respect to each part of the Option that
becomes exercisable in accordance with Section 4(b), the date which is ten years
after such part of the Option becomes exercisable in accordance with Section
4(b).

        "Fair Market Value" is defined in Section 5(b).

        "Issuance or Sale Date" is defined in Section 5(a)(ii).

        "Operating Company" means Geneva Steel LLC, a Delaware limited liability
company.

        "Option" is defined in the introductory paragraph.

        "Option Plan" means the Geneva Steel Holdings Corp. 2001 Stock Option
Plan, adopted under the Reorganization Plan.

        "Optionee" means the Executive and any Permitted Transferee who holds an
Option from time to time.

        "Permitted Transferee" means any of the following: (i) any revocable
trust created for the benefit of the Executive during the lifetime of the
Executive of which the Executive (whether in the capacity as a trustee, settlor
or otherwise) has voting and dispositive control over the assets held by such
trust, (ii) any irrevocable trust created for the benefit of the Executive
and/or any spouse of the Executive and/or any descendant of the Executive (which
term shall include any adopted child or stepchild of the Executive) of which the
Executive is a trustee having voting and dispositive control over the assets
held by such trust, (iii) a custodianship for the benefit of a minor who is a
descendant of the Executive (which term shall include any adopted child or
stepchild of the Executive), to which any transfer is made pursuant to and which
is valid under the Uniform Transfers to Minors Act, the Uniform Gifts to Minors
Act or a substantially similar act, and of which the Executive is a custodian
having voting or dispositive control over the assets held pursuant to such
custodianship, (iv) any partnership, limited liability company or similar entity
all of the ownership interests in which are held by the Executive alone, or by
the Executive and any spouse of the Executive and/or any descendant of the
Executive (which term shall include any adopted child or stepchild of the
Executive) and/or any Person referred to in clauses (i) - (iii) above, which is
Controlled by the Executive and (v) any corporation (including, without
limitation, any direct or indirect subsidiary of any such corporation) which is
wholly-owned directly or indirectly, by the Executive alone or by the Executive
and any one or more Persons referred to in clauses (i) - (iv) above and which is
Controlled by the Executive.

        "Person" means an individual, partnership, corporation, limited
liability company, trust or other entity of whatever nature.

        "Reorganization Plan" is defined in the introductory paragraph.

        "Securities Act" means the Securities Act of 1933, as amended.

        "Termination" means any of (i) a discharge of the Executive, (ii)
reduction in compensation of the Executive, (iii) the assignment of the
Executive to any duties inconsistent in any material respect to the Executive's
position (including status, offices, title and reporting

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requirements), authority, duties or responsibilities or (iv) requiring the
Executive to be based at any office or location that is more than seventy-five
(75) miles from Vineyard, Utah.

        2. Issuance of the Option. The Option is being issued to ______________
_______ as of _________________.

        3. Registration; Transfers and Exchanges. An Optionee may transfer an
Option, in whole or in part, from time to time, to one or more Permitted
Transferees, by surrendering this Option Agreement, with the form of assignment
attached to this Agreement as Exhibit A duly executed, at the office of the
Company (or such other office or agency of the Company as it may designate by
notice in writing to the Optionee). Upon such surrender, the Company shall issue
and deliver to the Optionee a new Option Agreement, in the name of the Permitted
Transferee or Permitted Transferees and in the denomination or denominations
specified in such instrument of assignment. If the right to purchase less than
all of the shares of Common Stock issuable upon exercise of the Option shall be
so transferred, the Optionee shall be entitled to receive a new Option Agreement
covering in the aggregate the number of shares of Common Stock with respect to
which the right to purchase shall not have been so transferred, and the
transferee or transferees shall be entitled to receive a new Option Agreement
covering in the aggregate the remaining number of shares of Common Stock
issuable upon the exercise of Option. An Option Agreement which is surrendered
upon transfer of an Option shall be cancelled by the Company.

        4. Duration; Exercise of Option.

                (a) The Option expires on the applicable Expiration Date.

                (b) The Option becomes exercisable with respect to ______ shares
on the date of this Option Agreement and with respect to an additional ______
shares on each of the first, second and third anniversaries of the date of this
Option Agreement.

                (c) The exercisability of this Option accelerates upon the death
or disability of the Executive, a Change of Control of the Company or the
Operating Company, or the Termination of the Executive's employment with either
the Company or the Operating Company other than for Cause.

                (d) The exercise price of the Option is $______ per share.

                (e) The Option may be exercised, in whole or in part, to the
extent it has become exercisable, on any Business Day on or prior to the
applicable Expiration Date. After the close of business on the applicable
Expiration Date, the Option to the extent it remains unexercised, shall lapse
and become void and of no value.

                (f) Exercise of the Option shall be made only by a written
notice in substantially the form of Exhibit B delivered in person or by mail to
the Secretary of the Company at the Company's principal executive office (or
such other office or agency of the Company as it may designate by notice in
writing to the Optionee), specifying the number of shares of Common Stock to be
purchased and accompanied by payment therefor and otherwise in accordance with
the terms of this Option Agreement. The Exercise Price for any shares of Common
Stock purchased pursuant to the exercise of the Option shall be paid, in the
discretion of the Optionee: (i) in cash (including cash equivalents), (ii) by a
broker-assisted delivery of

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shares of Stock already owned by the optionee for at least six (6) months, (iii)
by a broker-assisted "cashless exercise" effected in accordance with rules
adopted by the Committee and reasonably acceptable to optionee or (iv) any
combination of the foregoing. Any shares of Common Stock withheld upon exercise
as payment of the Exercise Price shall be valued at their Fair Market Value on
the trading day preceding the date of exercise of the Option. The Optionee shall
deliver the notice of exercise along with this Agreement to the Secretary of the
Company, who shall endorse hereon a notation of such exercise and return this
Option Agreement to the Optionee.

                (g) On or before the tenth (10th) day (or if the 10th day shall
not be a Business Day, then on the next Business Day thereafter) after each
exercise of this Option, the Company shall issue and deliver to the Optionee, in
the name of the Optionee or any Permitted Transferee, a certificate for the
shares of Common Stock issuable upon such exercise, to the extent shares are
issuable. Such certificate shall be deemed to have been issued, and any person
so designated to be named therein shall be deemed to have become the holder of
record of such shares of Common Stock, as of the date of the exercise of the
Option.

        5. Adjustment of Number of Shares.

                (a) The number of shares of Common Stock acquired upon the
exercise of the Option shall be subject to adjustment from time to time, as
follows:

                        (i) In case the Company shall (A) subdivide or split the
outstanding shares of its Common Stock into a larger number of shares, (B)
combine the outstanding shares of its Common Stock into a smaller number of
shares, or (C) reclassify the outstanding shares of its Common Stock, each
Optionee shall thereafter be entitled to receive upon the exercise of an Option
(subject to such further adjustments as may be required pursuant to this Section
5(a)(i) and Sections 5(a)(ii)-(v)) the number of shares of Common Stock of the
Company which at the date of such conversion it would have owned and been
entitled to receive had such Option been exercised immediately prior to the
happening of the first of such events to occur after the date of this Agreement
and prior to such conversion. An adjustment made pursuant to this Section
5(a)(i) shall become effective immediately upon the effectiveness of a
subdivision, split, combination or reclassification.

                        (ii) Except as provided in Section 5(c), in case the
Company shall at any time or from time to time sell or issue shares of Common
Stock (or securities convertible into shares of Common Stock) at a price per
share (or having a conversion price per share) less than the Fair Market Value
as of the date of issuance or sale (the "Issuance or Sale Date") of such shares
or of such convertible securities, then, and in each such case, the number of
shares of Common Stock for which an Option is exercisable shall be adjusted so
that the Optionee shall be entitled to receive, upon the exercise thereof, the
number of shares of Common Stock determined by multiplying (A) the number of
shares of Common Stock for which such Option was exercisable on the day
immediately prior to the Issuance or Sale Date by (B) a fraction, (1) the
numerator of which shall be the sum of (x) the number of shares of Common Stock
outstanding on the day immediately prior to the Issuance or Sale Date, and (y)
the number of additional shares of Common Stock issued or sold (or into which
the convertible securities may be converted), and (2) the denominator of which
shall be the sum of (x) the number of shares of Common Stock outstanding on the
day immediately prior to the Issuance or Sale Date, and

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(2) the number of shares of Common Stock which the aggregate consideration
receivable by the Company for the total number of shares of Common Stock so
issued or sold (or into which the convertible securities may be converted) would
purchase at such Fair Market Value on the Issuance or Sale Date. An adjustment
made pursuant to this Section 5(a)(ii) shall be made on the next Business Day
following the Issuance or Sale Date and shall be effective retroactively
immediately after the close of business on such date. For purposes of this
Section 5(a)(ii), the aggregate consideration receivable by the Company in
connection with the issuance or sale of shares of Common Stock or of securities
convertible into shares of Common Stock shall be deemed to be equal to the sum
of the aggregate offering price (before deduction of reasonable underwriting
discounts or commissions and expenses) of all such securities sold plus the
minimum aggregate amount, if any, payable upon conversion of any such
convertible securities into shares of Common Stock. Notwithstanding the
foregoing, in the event that this Section 5(a)(ii) shall apply because the
Company shall issue to all holders of its Common Stock as a class any rights,
warrants or options enabling them to subscribe for or purchase shares of Common
Stock, the Issuance or Sale Date shall be the record date relating thereto.

                        (iii) Except as provided in Section 5(c), in case the
Company shall distribute to all holders of its shares of Common Stock as a class
evidences of its indebtedness, securities (other than Common Stock), assets
(other than cash dividends), or rights, warrants or options entitling them to
subscribe for or purchase any of its securities, then in each such case the
number of shares of Common Stock into which each Option shall thereafter be
exercisable shall be determined by multiplying (A) the number of shares of
Common Stock for which each Option was exercisable immediately prior to the
record date for determination of shareholders entitled to such distribution by a
fraction (B), (1) the numerator of which shall be the Fair Market Price per
share of Common Stock at such record date, and (2) the denominator of which
shall be such Fair Market Value per share less the amount of such cash dividend
and/or the fair value (as determined by the Company's independent accountants or
such investment bank or other agent selected by the Board of Directors and
reasonably acceptable to the Optionee, whose determination shall be conclusive
and shall be described in a statement filed with the Company) of the portion of
the evidences of indebtedness, securities (other than Common Stock), assets
(other than cash dividends) or rights, warrants or options so distributed
applicable to one share of Common Stock. An adjustment made pursuant to this
Section 5(a)(iii) shall be made upon the opening of business on the next
Business Day following the date on which any such dividend or distribution is
made and shall be effective retroactively immediately after the close of
business on the record date fixed for the determination of shareholders entitled
to receive such dividend or distribution.

                        (iv) In case the Company shall pay or make a dividend or
other distribution on any class of capital stock of the Company in shares of
Common Stock, then the number of shares of Common Stock for which each Option
shall thereafter be exercisable shall be determined by multiplying the number of
shares of Common Stock for which such Option was exercisable immediately prior
to the record date for determination of shareholders entitled to such dividend
or other distribution by a fraction, (A) the numerator of which shall be the sum
of the number of shares of Common Stock outstanding at such record date and the
total number of shares of Common Stock constituting such dividend or other
distribution, and (B) the denominator of which shall be the number of shares of
Common Stock outstanding at such record date. An adjustment pursuant to this
Section 5(a)(iv) shall become effective immediately after such record date.

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                        (v) If any event occurs as to which, in the good faith
judgment of the Board of Directors of the Company, the other provisions of this
Section 5 are not strictly applicable, then the Board of Directors of the
Company may appoint its regular independent auditors or another firm of
independent public accountants of recognized national standing which shall give
their opinion upon the adjustment, if any, on a basis consistent with the
essential intent and principles of such provisions, necessary to preserve,
without dilution, the rights of the Optionee. Upon receipt of such opinion, the
Board of Directors of the Company shall forthwith make the adjustments described
therein. In the event the Board of Directors determines not to appoint its or
other independent public accountants, and the Executive in good faith reasonably
determines that the appointment of such independent public accountant is
necessary or appropriate, the Executive shall be entitled to appoint such
independent public accountants as the Executive reasonably determines for
purposes of making the determination under this Section 5(a)(v).

                (b) Fair Market Value per share of Common Stock on any date
shall be deemed to be (i) the average of the daily closing prices for the twenty
consecutive Business Days ending on the Business Day before the day in question
or (ii) in the event that the Issuance or Sale Date shall be a record date, the
average of the daily closing prices for the twenty (20) consecutive Business
Days commencing thirty five Business Days before such record date. The closing
price for each day shall be the last reported sales price on the composite tape
or, in case no such reported sale takes place on such day, the average of the
reported closing bid and asked prices, in either case on the principal national
securities exchange on which the Common Stock is listed or admitted to trading
or, if not listed or admitted to trading on any national securities exchange,
the average of the closing bid and asked prices on the National Association of
Securities Dealers Automated Quotation System or, if the Common Stock is not
then so quoted, by any New York Stock Exchange member firm selected from time to
time by the Company in good faith for that purpose.

                (c) Notwithstanding the foregoing provisions of this Section 5,
(i) no adjustment in the number of shares of Common Stock for which any Option
is exercisable shall be required unless such adjustment would require an
increase or decrease in such number of shares of at least one percent 1%,
provided any adjustments which by reason of this Section 5(c) are not required
to be made shall be carried forward and taken into account in any subsequent
adjustment, and (ii) no adjustment in the number of shares of Common Stock for
which any Option is exercisable shall be required as a result of (A) exercise of
any options granted under the Option Plan or (B) the conversion of any preferred
stock issued pursuant to the Reorganization Plan into Common Stock. All
calculations under this Section 5 shall be made to the nearest cent or to the
nearest 1/100th of a share, as the case may be.

                (d) Whenever the number of shares of Common Stock for which the
Option is exercisable is adjusted as provided in this Section 5, the Company
shall promptly mail to the Optionee a notice stating that the number of shares
of Common Stock for which the Option is exercisable has been adjusted and
setting forth the new number of shares of Common Stock (or describing the new
stock, securities, cash or other property) for which the Option is exercisable
as a result of such adjustment, a brief statement of the facts requiring such
adjustment and the computation thereof, and when such adjustment became
effective.

                                       6
<PAGE>   7

                (e) In case at any time the Company shall be party to any
transaction (including, without limitation, a consolidation or merger of the
Company with another corporation or a sale or transfer of all or part of the
Company's assets for cash, securities or other property) in which the previously
outstanding Common Stock shall be changed into or exchanged for different
securities of the Company or common stock or other securities of another
corporation or interests in a noncorporate entity or other property (including
cash) or any combination of any of the foregoing (each such transaction being
herein called the "Transaction" and the date of consummation of the transaction
being herein called the "Closing Date"), then lawful and adequate provisions
shall be made as a part of the terms of the Transaction so that (A) the Option
shall continue to remain outstanding, except that (B) the Option shall
thereafter be exercisable for, in lieu of the Common Stock issuable upon such
exercise prior to the Closing Date, the amount of securities or other property
to which the Optionee would actually have been entitled as a holder of shares of
Common Stock upon the consummation of the Transaction if the Optionee had
exercised such Option immediately prior to such Transaction (subject to
adjustments from and after the Closing Date nearly equivalent as possible to the
adjustments provided for in this Section 5(e)). In case securities or properties
other than common stock shall be issuable or deliverable upon conversion as
aforesaid, then all references in this Section 5 shall be deemed to apply, so
far as appropriate and as nearly as may be, to such other securities or
properties. Notwithstanding the foregoing, in the event the Company shall be
party to any Transaction in which the previously outstanding Common Stock shall
be changed into or exchanged for common stock or other securities of another
corporation, and such common stock or other securities are not traded on a
securities exchange or other public market, then the provisions of this Section
5(e) shall be deemed satisfied if the Executive shall receive fair and adequate
consideration in lieu of the Option, based on a good faith valuation of the
Company and the Transaction by an investment banking firm reasonably acceptable
to the Company and the Executive.

                (f) In the event that at any time, as a result of an adjustment
made pursuant to the provisions of Section 5(a), the Optionee shall become
entitled to receive any shares of the Company other than shares of Common Stock,
thereafter the number of such other shares so receivable upon exercise of the
Option shall be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions with respect to the Common
Stock contained in Section 5(a), and the other provisions of this Section 5 with
respect to the Common Stock shall apply on like terms to any such other shares.

                (g) In connection with the exercise of the Option, no fractions
of shares of Common Stock shall be issued, but in lieu thereof the Company shall
pay a cash adjustment in respect of such fractional interest in an amount equal
to such fractional interest multiplied by the Fair Market Value per share of
Common Stock on the day on which such Option is deemed to have been exercised.

                (h) Nothing contained in an Option Agreement shall be construed
as conferring upon the Optionee the right to vote or receive dividends or to be
deemed for any purpose the holder of shares of Common Stock or of any other
securities of the Company which may at any time be issuable on the exercise of
an Option or be construed to confer upon the Optionee, as such, any of the
rights of a shareholder of the Company or any right to vote upon any matter
submitted to shareholders at any meeting thereof, or to give or withhold consent
to any corporate action (whether upon any recapitalization, issue of stock,
reclassification of stock,

                                       7
<PAGE>   8

change of par value, consolidation, merger, conveyance, or otherwise) or, except
as provided herein, to receive notice of meetings, or to receive dividends or
subscription rights or otherwise, until the Option shall have been exercised as
provided herein.

                (i) Irrespective of any adjustments in the number or kind of
shares purchasable upon the exercise of the Option, an Option Agreement may
continue to express the same number and kind of shares as are stated on the
Option Agreement initially issued. Notwithstanding the foregoing, the Company
may, at its discretion, issue a new Option Agreement in such form as may be
approved by its Board of Directors to reflect any adjustment or change in the
number or kind or class of shares of stock or other securities or property
purchasable under an Option.

        6. Reservation of Shares. The Company shall at all times reserve and
keep available, free from preemptive rights, out of the aggregate of its
authorized but unissued shares of Common Stock or its authorized and issued
shares of Common Stock held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue shares of Common Stock upon exercise of the
Option, the full number of shares of Common Stock deliverable upon the exercise
of the Option in full. The Company covenants that all shares of Common Stock
which may be issued upon the exercise of the Option shall, upon issuance, be
fully paid and nonassessable and free from all company taxes, liens, charges and
security interests with respect to the issue thereof (other than income or
capital gains taxes to recipients).

        7. Payment of Taxes. The Company shall pay all documentary stamp taxes,
if any, attributable to the issuance of Options and issuance of shares of Common
Stock or other securities upon the exercise of Options, provided the Company
shall not be required to pay any tax or taxes which may be payable in respect of
any transfer involved in the issue of any certificates for shares of Common
Stock in a name other than that of the Optionee, and the Company shall not be
required to issue or deliver such certificates unless or until the persons
requesting the issuance thereof shall have paid to the Company the amount of
such tax or shall have established to the satisfaction of the Company that such
tax has been paid.

        8. Obtaining of Governmental Approvals and Stock Exchange Listings. The
Company shall take all reasonable action which may be necessary to obtain and
keep effective any and all permits, consents and approvals of governmental
agencies and authorities, and shall make any and all filings under Federal and
State securities laws, necessary in connection with the issuance, distribution
and transfer of Option Agreements, the exercise of the Options, and the
issuance, sale, transfer and delivery of shares of Common Stock upon exercise of
Options, except that the foregoing provisions of this sentence shall not be
deemed to require registration of the Option or the shares of Common Stock
issuable on exercise of the Option under the Securities Act or similar state
securities laws. The Company shall use reasonable efforts to have the shares of
Common Stock which are issuable upon the exercise of the Option listed on the
securities exchange, if any, on which the then outstanding shares of Common
Stock are listed.

        9. Notices to Optionee.

                (a) Upon any adjustment of the number of shares of Common Stock
with respect to which the Option is exercisable pursuant to Section 5 hereof,
the Company within twenty (20) days thereafter shall cause notice of such
adjustment to be mailed by first class mail,

                                       8
<PAGE>   9

postage prepaid, to the Optionee. Where appropriate, such notice may be mailed
in advance and included as a part of any notice required to be mailed under any
other provision of this Section 9.

                (b) In case:

                        (i) the Company shall take action to make any
distribution to the holders of its Common Stock;

                        (ii) the Company shall take action to offer for
subscription pro rata to the holders of its Common Stock any securities of any
kind (other than pursuant to the offering referred to in Section 5.05 of the
Reorganization Plan);

                        (iii) the Company shall take action to accomplish any
capital reorganization, or reclassification of the capital stock of the Company,
or consolidation or merger to which the Company is a party and for which
approval of any shareholders of the Company is required, or the sale or transfer
of all or substantially all of the assets of the Company; or

                        (iv) the Company shall take action with regard to a
voluntary or involuntary dissolution, liquidation or winding up of the Company;
then the Company shall (A) in case of any such distribution or subscription
rights, at least fifteen (15) days prior to the date or expected date on which
the books of the Company shall close or a record shall be taken for the
determination of holders entitled to such distribution or subscription rights,
and (B) in the case of any such reorganization, reclassification, consolidation,
merger, sale, transfer, dissolution, liquidation or winding up, at least fifteen
(15) days prior to the date or expected date when the same shall take place,
cause written notice thereof to be mailed to the Optionee. Such notice in
accordance with the foregoing clause (A) shall also specify, in the case of any
such distribution or subscription rights, the date or expected date on which the
holders of Common Stock shall be entitled thereto, and such notice in accordance
with the foregoing clause (B) shall also specify the date or expected date on
which the holders of Common Stock shall be entitled to exchange their Common
Stock for securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding up, as the case may be. If any action referred to in this
subsection 9(b) requires the approval of holders of shares of Common Stock, the
Company shall cause notice of the proposed action and the record date for the
determination of holders of Shares entitled to vote on such matter to be mailed
to each of the registered holders of the Option Certificates at his address
appearing on the Option Register, at least ten (10) days prior to such record
date, by first class mail, postage prepaid. The failure to give any notice
required by this subsection 9(b) or any defect therein shall not affect the
legality of any such reclassification, consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up, or the vote upon any action.

        10. Notices to the Company. Any notice pursuant to a Option Certificate
shall be sufficiently given to the Company, if sent by first class mail, postage
prepaid, or by hand addressed to:

                                       9
<PAGE>   10

                           Geneva Steel Holdings Corp.
                           10 South Geneva Road
                           Vineyard, Utah   84058
                           Attn:  Corporate Secretary

        11. Miscellaneous

                (a) Costs and Expenses. The Company shall pay as incurred, to
the full extent permitted by law, all legal fees and expenses which the Optionee
may reasonably incur as a result of any contest by the Company, the Optionee or
others of the validity or enforceability of, or liability under, any provision
of this Agreement, plus, in each case in which payment is owed by the Company,
interest on any delayed payment at the applicable Federal rate provided for in
Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended.
Notwithstanding the foregoing, the Company and the Optionee acknowledge and
agree that legal fees and expenses of the Optionee in connection with a contest
of the validity or enforceability of, or liability under, any provision of this
Agreement in which the Optionee does not prevail, shall not be reimbursable
pursuant to this Section 11(a). The Company acknowledges and agrees that in the
event the Optionee does not prevail, in no event shall the Optionee be required
to pay any legal fees and expenses of the Company.

                (b) Successors. All the covenants and provisions hereof shall be
binding upon any successors and assigns of the Company.

                (c) Termination. The rights granted pursuant to the terms of
this Option Agreement shall terminate at the close of business on the Expiration
Date.

                (d) Governing Law. This Option Agreement shall be deemed to be a
contract made under the laws of the State of Delaware and for all purposes shall
be governed by and construed in accordance with the laws of such state
applicable to contracts to be made and performed entirely within such state.

                (e) Benefits of this Agreement. Nothing herein shall be
construed to give to any person or corporation other than the Company, and the
Optionee any legal or equitable right, remedy or claim hereunder.

                (f) Conflicts. In the event of a conflict between the terms of
this Agreement and the Option Plan, the terms of this Agreement shall govern.

                                       10
<PAGE>   11

                IN WITNESS WHEREOF, the Company and the Optionee have caused
this Option Agreement to be duly executed as of the day and year first above
written.

                                       GENEVA STEEL HOLDINGS CORP.

                                       By:
                                           -------------------------------------
                                            Name:
                                            Title:

ATTEST:

----------------------------------
Name:
Title:

                                           -------------------------------------
                                            Optionee

                                       11
<PAGE>   12

                                    EXHIBIT A
                               FORM OF ASSIGNMENT

                         (To be executed by the Optionee
                   if Optionee desires to transfer the Option)

        FOR VALUE RECEIVED __________________________ hereby sells, assigns and
transfers unto _______________________________

          ------------------------------------------------------------
                  (Please print name and address of transferee)

          ------------------------------------------------------------

          ------------------------------------------------------------

          ------------------------------------------------------------

          ------------------------------------------------------------

          ------------------------------------------------------------

this Option, together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint _________________________ Attorney, to
transfer the within Option on the books of the within-named Company, with full
power of substitution.

Dated:
       ----------------------

                                       -----------------------------------------
                                       Signature

<PAGE>   13

                                    EXHIBIT B
                               NOTICE OF EXERCISE

                         (To be executed if the Optionee
                         desires to exercise the Option)

To: Geneva Steel Holdings Corp.

        The undersigned hereby irrevocably elects to exercise the Option
evidenced by the Option Agreement dated _________ with respect to ________
shares of Common Stock issuable upon the exercise of such Option and requests
that certificates for such shares of Common Stock be issued in the name of:

        Payment of the exercise price for such shares will be made as follows:
_________

_________________________________________________________________.

Please insert social security or other identifying number: ___________________

                                       -----------------------------------------
                                       (Please print name and address)

                                       -----------------------------------------

                                       -----------------------------------------

                                       -----------------------------------------

Dated:
       ----------------------

                                     NOTICE

The signature(s) in the foregoing Subscription Form must correspond to the name
as written upon the face of this Option Agreement in every particular, without
alteration or enlargement or any change whatsoever.

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