UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a -101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant ☒
Filed by a Party other than the Registrant ☐
Check the appropriate box:
☐ | Preliminary Proxy Statement |
☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
☒ | Definitive Proxy Statement |
☐ | Definitive Additional Materials |
☐ | Soliciting Material Pursuant to §240.14a-12 |
Ryerson Holding Corporation
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
☒ | No fee required. |
☐ | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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| (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): |
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| (5) | Total fee paid: |
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Ryerson 20202022 Proxy Statement Notice of Annual Meeting of Stockholders
227 W. Monroe St., 27th Floor
Chicago, Illinois 60606
Notice of Annual Stockholders’ Meeting
Wednesday,Thursday, April 28, 2021 2:2022 1:00 p.m. Central Daylight Time
Virtual Meeting via a live audio-only webcast at www.proxydocs.com/RYI
March 12, 202111, 2022
To our Stockholders:
You are cordially invited to the 20212022 annual meeting of stockholders of Ryerson Holding Corporation scheduled to be held on Wednesday,Thursday, April 28, 2021,2022, at 2:1:00 p.m. Central Daylight Time via a live audio-only webcast at www.proxydocs.com/RYI. There is no physical location for the 20212022 annual meeting. At the meeting, we will consider:
| Ο | The election of |
| Ο | The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2022; |
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| Ο | Such other business as may properly come before the meeting. |
Stockholders who owned shares of our stock at the close of business on March 1, 20214, 2022 can vote on these proposals.
Our 20212022 annual meeting of stockholders will be a virtual meeting. In order to attend the annual meeting, you must register in advance at www.proxydocs.com/RYI. Upon completing your registration, you will receive further instructions via email, including your unique links that will allow you access to the meeting and will also permit you to submit questions.
Your vote is important regardless of the number of shares of stock you own. Whether you plan to attend or not, please review our proxy materials and request a proxy card to sign, date and return, or submit your voting instructions by telephone or through the Internet. On or about the date of this letter, we began mailing a Notice of Internet Availability of Proxy Materials (the “Notice”). Instructions for each type of voting are included in the Notice that you received and in this proxy statement. If you plan to attend the meeting and prefer to vote at that time, you may do so. If you hold your shares through a broker, bank, or other institution, please be sure to follow the voting instructions that you receive from the holder. The holder will not be able to vote your shares on any of the proposals except the ratification of the appointment of Ernst & Young LLP unless you have provided voting instructions.
Mark S. Silver
Executive Vice President, General Counsel & Chief Human Resources Officer
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON APRIL 28, ANNUAL REPORT ARE AVAILABLE AT http://www.proxydocs.com/RYI. |
RYERSON HOLDING CORPORATION
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Consideration of Results of Advisory Vote on Executive Compensation |
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Narrative Relating to Summary Compensation Table and Grants of Plan-Based Awards |
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Policies and Procedures Regarding Transactions with Related Persons |
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Stockholder Proposals and Director Nominations for the |
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Ryerson Holding Corporation (“Ryerson,” the “Company,” “we,” “us” or “our”) is furnishing this proxy statement to the holders of our common stock in connection with the solicitation of proxies on behalf of our board of directors (the “Board”) for use at our 2021 annual meeting of stockholders, which will be held on Wednesday, April 28, 2021, via a live audio-only webcast at www.proxydocs.com/RYI. There is no physical location for the 2021 annual meeting. We will begin sending notice of the availability of these proxy materials on or about March 12, 2021.
Our common stock trades on the New York Stock Exchange (“NYSE”) under the ticker symbol ‘RYI’. The Company’s fiscal year ends on December 31 of each calendar year. Our corporate headquarters is located at 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606, and our website address is www.ryerson.com. Please note that the information on our website is not, and shall not be deemed to be, a part of this proxy statement nor, by reference or otherwise (except to the extent we specifically incorporate it by reference), incorporated into any other filings we make with the Securities and Exchange Commission (“SEC”).
On August 13, 2014, we completed an initial public offering of 11 million shares of our common stock (the “IPO”). Prior to that time, all of our common stock was held by affiliates of Platinum Equity, LLC (together with such affiliates, “Platinum”), which still own approximately 55% of Ryerson’s common stock. For additional information regarding Platinum’s ownership, see below under “Ownership of More Than 5% of Ryerson Stock,” on page 50.
As the context requires, “Ryerson,” the “Company,” “we,” “us” or “our” may also include the direct and indirect subsidiaries of Ryerson Holding Corporation.
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This proxy statement contains information we must provide to you under the rules of the SEC and the NYSE in connection with the solicitation of proxies by our Board for the 20212022 annual meeting of stockholders. It is designed to assist you in voting your shares of our stock.
You may vote if you were the holder of record of shares of our common stock at the close of business on March 1, 2021.4, 2022. You are entitled to one vote on each matter presented at the 20212022 annual meeting of stockholders for each share of our stock you owned at that time. If you held stock at that time in “street name” through a broker, bank or other institution, you must either provide voting instructions to the holder or obtain a proxy, executed in your favor, from the holder to be able to vote those shares at the meeting.
Each share of Ryerson common stock is entitled to one vote. As of the close of business on March 1, 20214, 2022 (the record date for determining stockholders entitled to vote at the annual meeting), we had 38,117,39738,394,162 shares of common stock outstanding and entitled to vote.
You are entitled to attend our 20212022 annual meeting if you were the holder of record of shares of our common stock at the close of business on March 1, 20214, 2022 or if you hold a valid proxy for the annual meeting.
This year’s annual meeting will be accessible through the Internet via a live audio-only webcast. You are invited to attend the annual meeting via audio-only webcast to vote on the proposals described in this Proxy Statement so long as you register to attend the annual meeting at www.proxydocs.com/RYI. You will be asked to provide the control number located inside the shaded gray box on your notice or proxy card (the “Control Number”) as described in the Notice of Internet Availability of Proxy Materials (the “Internet Availability Notice”) or proxy card. After completion of your registration, further instructions, including a unique link to access the annual meeting of stockholders, will be emailed to you. If you request a printed copy of our proxy materials by mail, your broker or nominee will provide a voting instruction card for you to use. This year’s stockholder question and answer session will include questions submitted in advance of the annual meeting. You may submit a question in advance of the meeting at www.proxydocs.com/RYI after logging in with your Control Number.
You are voting on:
| Ο | The election of |
| Ο | The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for |
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| Ο | Such other business as may properly come before the meeting. |
If your shares of stock are registered directly in your name, you are considered a stockholder of record and you will receive your Notice directly from us. Stockholders of record can vote in advance of our annual meeting by requesting a proxy card to sign, date and return or by submitting voting instructions by telephone or through the Internet. Please see the Notice you received or this proxy statement for specific instructions on how to cast your vote by any of these methods.
To vote during the annual meeting, you must do so through www.proxydocs.com/RYI. To be admitted to the annual meeting and vote your shares, you must register and provide the Control Number as described in the Internet Availability Notice or Proxy Card. After completion of your registration, further instructions, including a link a unique link to access the annual meeting, will be emailed to you.
If you hold your shares of stock through a broker, bank or other institution, you fareare considered the beneficial owner of stock held in “street name” and you will receive your notice from your broker, bank or other institution.
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For stockholders of record, voting instructions submitted via mail, telephone or the Internet must be received by our independent tabulator, Mediant, by the closing of the polls at the annual meeting. Submitting your voting instructions prior to the annual meeting will not affect your right to vote in person should you decide to attend the meeting.
2 RYERSON HOLDING CORPORATION |
Stockholders of Record Can Vote By:
| Ο | Requesting and returning a completed proxy card by mail to our independent tabulator, Mediant, by the closing of the polls at the annual meeting; |
| Ο | Submitting voting instructions via the |
| Ο | Voting at the annual meeting after registering at www.proxydocs.com/RYI by providing the Control Number as described in the Internet Availability Notice or Proxy Card. |
Instructions and contact information for each of these voting options can be found in our Notice of Internet Availability of Proxy Materials.
The Internetinternet and telephone voting procedures available to you are designed to authenticate stockholders’ identities, to allow stockholders to submit voting instructions and to confirm that stockholders’ voting instructions have been recorded properly. We have been advised that the Internetinternet and telephone voting procedures are consistent with the requirements of applicable law. Stockholders voting via the Internetinternet or telephone should understand that there may be costs associated with voting in this manner, such as usage charges from Internetinternet access providers and telephone companies, which must be borne by the stockholder.
If you hold your stock in street name, you can vote by submitting a voting instruction card to your broker, bank or other institution that sent your Notice to you in accordance with their procedures. Please note that if you hold your stock in street name, the broker, bank or other institution that holds the stock will not be able to vote your shares on any proposal other than the ratification of the appointment of Ernst & Young LLP unless you have provided voting instructions. If you hold your stock in street name and wish to vote at the meeting, you must obtain a proxy, executed in your favor, from the holder of record of the stock as of the record date.
What If I Do Not Provide Voting Instructions?
If you submit a valid proxy card, or validly submit voting instructions via the telephone or Internet,internet, but you do not indicate your vote, your shares of stock will be voted FOR:
| Ο | The election of the |
| Ο | The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for |
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You also give the proxies discretionary authority to vote on any other business that may properly be presented at the annual meeting.
Can I Revoke or Change My Vote?
If you are a stockholder of record, you may revoke or change your proxy and voting instructions at any time prior to the vote at the annual meeting. To do so:
| Ο | Submit a new proxy card or voting instructions to the independent tabulator, Mediant, by mail, telephone or through the Internet by the closing of the polls at the annual meeting; or |
| Ο | Attend the annual meeting and submit an electronic ballot. |
If you hold your stock in street name, you may revoke or change your proxy instructions prior to the vote at the annual meeting by submitting new voting instructions to your broker, bank or other institution in accordance with their procedures.
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Who Are the Proxies andand What Do They Do?
When you vote in advance of the annual meeting, you appoint Mr. Mark S. Silver, our Executive Vice President, General Counsel & Chief Human Resources Officer, and Ms. Camilla R. Merrick, our Corporate Secretary, as proxies, each with the power to appoint a substitute. You direct them to vote all of the shares of stock you held on the record date at the annual meeting and at any adjournment or postponement of that meeting. If you submit a valid proxy card or validly submit voting instructions via the telephone or Internet,internet, and you do not subsequently revoke your proxy or vote, the individuals named on the card as your proxies will vote your shares of stock in accordance with your instructions. If you submit a valid proxy card or voting instructions but you do not indicate your vote, your shares of stock will be voted as described above under “What If I Do Not Provide Voting Instructions?” on page 3.this page.
2022 Proxy Statement 3 |
Is My Vote Confidential?Confidential?
We have a confidential voting policy. Stockholders’ votes will not be disclosed to us other than in limited situations. The independent tabulator will collect, tabulate and retain all proxies and will forward any comments written on the proxy cards or otherwise received by the independent tabulator to management. Our confidential voting policy will not apply in the event of a contested solicitation.
What Is the Quorum Requirement for the Annual Meeting?
A quorum is necessary to hold a valid meeting. A quorum will exist if stockholders holding a majority of the shares of stock issued and outstanding and entitled to vote at the meeting are present in person or represented by proxy.
How Are Abstentions, Withheld Votes and Broker Non-Votes Treated?
The election inspector will treat abstentions, withholds and “broker non-votes” as shares of stock that are present and entitled to vote for purposes of determining the presence of a quorum. A “broker non-vote” occurs when a broker holding stock for a beneficial owner does not vote on a particular proposal because the broker does not have discretionary voting power for that particular item and has not received instructions from the beneficial owner. Brokers will have discretionary voting power with respect to proposal two (the ratification of the appointment of Ernst & Young LLP), but not with respect to any other proposal. Abstentions and broker non-votes do not count as votes cast either for or against any of the proposals. A “withhold” vote with respect to any director nominee will have the effect of a vote against such nominee.
What Vote Is Required to Approve a Proposal?
Proposal One: A director nominee will be elected to the Board if the number of votes cast “for” the nominee’s election exceeds the number of votes “withheld” from the nominee’s election.
Proposal Two: The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 20212022 will be approved if holders of a majority of the stock present in person at the meeting or represented by proxy vote in favor of the proposal.
Proposal Three: The resolution approving the compensation of our named executive officers described under the heading “Executive Compensation” in our proxy statement will be approved on a non-binding, advisory basis, if holders of a majority of the stock present in person at the meeting or represented by proxy vote in favor of the proposal.
Proposal Four: A plurality of the affirmative votes cast will select, on a non-binding, advisory basis the frequency of the stockholder vote on the compensation of our named executive officers. We will consider stockholders to have expressed a non-binding preference for the frequency that receives the highest number of favorable votes.
Who Solicits Proxies and How Are They Paid?
The proxy accompanying this proxy statement is solicited on behalf of our Board for use at the annual meeting and Ryerson pays the expenses of soliciting the proxies. In addition to this solicitation by mail, our directors, officers and other employees may contact you by personal interview, telephone, electronic mail, facsimile, Internet or otherwise to obtain your proxy. These persons will not receive any additional compensation for these activities. Brokerage houses and other custodians, nominees and fiduciaries will be requested to forward solicitation material to the beneficial owners of stock. We will reimburse these entities and our transfer agent for their reasonable out-of-pocket expenses in forwarding solicitation material. We have not retained the services of a proxy solicitor.
How Do You Determine Whether I Get One or More Paper Copies of the Proxy Materials?
To reduce the costs of printing and distributing proxy materials we are taking advantage of the SEC rule that allows companies to furnish their proxy materials over the Internet. As a result, we send many stockholders a notice regarding the Internet availability of the proxy materials instead of a paper copy of our proxy materials. This notice explains how you can access the proxy materials over the Internet, and also describes how to request to receive a paper copy of the proxy materials. If you have requested paper copies of the proxy materials, you may have received one copy of our proxy statement, annual report or Notice for multiple stockholders in your household. This is because we and some brokers,
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banks and other record holders participate in the practice of “householding” proxy statements, annual reports and Notices of Internet Availability of Proxy Materials and deliver only one copy to stockholders at one address unless we or they receive other instructions from you.
If these materials were delivered to an address that you share with another stockholder, we will promptly deliver a separate copy if you make a written or verbal request to Ryerson Holding Corporation, Investor Relations, 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606, email: investorinfo@ryerson.com, or telephone: 312-292-5130.
If you are receiving multiple copies and would like to receive only one copy for your household, you may make such request as follows:
| Ο | If you are a stockholder of record, by contacting Ryerson Holding Corporation, c/o Mediant Communications, P.O. Box 8016, Cary, NC 27512-9903, or call Mediant at: 1-866-648-8133; and |
| Ο | If you are a beneficial owner of stock, by contacting your broker, bank or other holder of record. |
The Company’s proxy materials are also available at ir.ryerson.com.
4 RYERSON HOLDING CORPORATION |
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Our Board presently consists of seveneight directors, threeseven of whom our Board has determined to be independent under the NYSE Listed Company Manual and other NYSE rules and requirements (together, “NYSE rules”). Four of our directors are affiliated with Platinum, which owns a majority of our outstanding common stock. Because Platinum owns more than 50% of the voting power of our common stock, we are considered to be a “controlled company” for purposes of the NYSE rules. As such, we are permitted, and have elected, to opt out of the NYSE rules that would otherwise require our Board to be comprised of a majority of independent directors.
The Board is divided into three separate classes, with one class being elected each year to serve a staggered three-year term. The terms of the Class III Directors expire at the 20212022 annual meeting, and threetwo directors will be elected at the annual meeting to serve as Class III Directors for a three-year term expiring at the 20242025 annual meeting or until their successors are duly elected and qualified.
For the 20212022 annual meeting, the Board has proposed the following director nominees for election: Eva M. Kalawski, Mary Ann Sigler,Stephen P. Larson and Court D. Carruthers.Philip E. Norment.
Detailed information on each director nominee and continuing director is provided below under “Biographies” on page 11.9. If you submit valid voting instructions, the proxies will vote your shares of stock for the election of each of the nominees, unless you indicate that you wish to withhold your vote on a nominee. If at the time of the annual meeting any of the nominees is unable or declines to serve, the persons named in the proxy will, at the direction of the Board, either vote for the substitute nominee or nominees that the Board recommends, or the Board may reduce the number of directors to be elected at the meeting. The Board has no reason to believe that any nominee will be unable or will decline to serve as a director if elected.
Vote Required
Under our Bylaws, our directors are elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote in the election of directors. In an uncontested election, a director is elected if the votes cast “for” the director’s election exceed the votes “withheld” from the director’s election.
Recommendation of the Board
OUR BOARD UNANIMOUSLY RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” the election of Eva m. kalawski, mary ann sigler,Stephen p. larson and court d. carruthersphilip e. norment to serve as directors of the Company.
| 2022 Proxy Statement 5 |
Our Audit Committee has selected Ernst & Young LLP to serve as our independent registered public accounting firm for 2021.2022. Ernst & Young has served as the independent registered public accounting firm for the Company since 2006. Representatives of Ernst & Young will be present at the annual meeting to answer questions. They will also have the opportunity to make a statement if they desire to do so.
The Audit Committee is responsible for recommending, for stockholder approval, our independent registered public accounting firm. Should stockholders fail to approve the ratification of the appointment of Ernst & Young, the Audit Committee would undertake the task of reviewing the appointment. Nevertheless, given the difficulty and expense of changing independent accountants mid-way through the year, there is no assurance that a firm other than Ernst & Young could be secured to deliver any or all of the Company’s independent auditing services required in 2021.2022. The Audit Committee, however, would take the lack of stockholder approval into account when recommending an independent registered public accounting firm for 2021.2023.
The following table sets out the various fees for services provided by Ernst & Young for 20202021 and 2019.2020. The Audit Committee pre-approved all of these services. For additional information, see the description of the pre-approval policies and procedures of the Audit Committee under “Pre-approval Policies,” below on page 19.16.
Annual Fees for 20202021 and 20192020
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Audit Fees(1) |
| $ | 3,896,583 |
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| $ | 4,282,240 |
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| $ | 3,684,440 |
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| $ | 3,896,583 |
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Audit-related Fees(2) |
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Tax Fees(3) |
| $ | 133,582 |
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| $ | 454,925 |
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| $ | 38,778 |
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| $ | 133,582 |
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Other Fees(4) |
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| $ | 152,125 |
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Total |
| $ | 4,030,165 |
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| $ | 4,737,165 |
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| $ | 3,875,343 |
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| $ | 4,030,165 |
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(1) | Audit fees related to professional services rendered in conjunction with the audit of our annual financial statements, the audit of our internal control over financial reporting, the review of our quarterly financial statements, comfort letters, consents, and the audit of our statutory filings, and other services pertaining to SEC matters. |
(2) | Audit-related fees related to professional services that are reasonably related to the performance of the audit or review of the Company’s financial statements, including compliance-related matters, which are not specifically classified as audit |
(3) | Tax fees related to professional services performed by the independent auditor’s tax personnel and not included in audit fees or audit related fees, such as services related to tax audits, tax compliance and tax consulting and planning services. Tax fees primarily related to tax consulting and planning services related to international corporate structuring and transfer pricing relative to service charges from our U.S. operations to our Canadian subsidiary. |
(4) | For |
Ernst & Young LLP’sYoung’s full-time, permanent employees conducted a majority of the audit of the Company’s 20202021 financial statements. Leased personnel were not employed with respect to the domestic audit engagement.
Vote Required
The approval of this proposal requires the affirmative vote of a majority of the votes cast in person or by proxy and entitled to vote thereon at the 20212022 annual meeting, assuming that a quorum is present.
Recommendation of the Board
OUR BOARD UNANIMOUSLY RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” the ratification of the appointment of Ernst & Young as our independent registered public accounting firm for 2021.2022.
3. Non-Binding, Advisory Vote on the Compensation of Our Named Executive Officers
Section 14A of the Securities Exchange Act of 1934 (“Section 14A”) requires that the Company provide its stockholders with the opportunity to vote to approve, on a non-binding advisory basis, the compensation of its named executive officers at least once every three years. At the 2018 annual meeting, the stockholders followed the recommendation of our Board of Directors to hold an advisory vote on executive compensation once every three years. In 2018, the stockholders voted, and the Board of Directors determined, that the stockholders should vote on a say-on-pay proposal once every three years to provide the Company with sufficient time to thoughtfully consider the results of the vote and implement any desired changes to executive compensation policies and procedures. The last vote was held in 2018. Accordingly, the Company is seeking your vote to approve, on a non-binding advisory basis, the compensation of our named executive
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officers as disclosed in this proxy statement (the “Say-on-Pay Vote”). This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the philosophy, policies and practices described in this proxy statement.
Stockholders are urged to read the “Executive Compensation” section of this proxy statement, beginning on page 26, which discusses how our executive compensation policies and procedures implement our compensation philosophy and contains tabular information and narrative discussion about the compensation of our named executive officers. The Compensation Committee and the Board believe that these policies and procedures are effective in implementing our compensation philosophy and in achieving our goals.
As an advisory vote, the vote on this proposal is not binding. However, our Board and Compensation Committee, which is responsible for designing and administering our executive compensation program, value the opinions expressed by stockholders in their vote on this proposal, and will consider the outcome of the vote when making future compensation decisions for our named executive officers.
Based on the above, we request that you indicate your support for our executive compensation practices by voting in favor of the following resolution:
“RESOLVED, that the Company’s stockholders approve the compensation of the Company’s named executive officers as described in this Proxy Statement in the “Executive Compensation” section, including the Compensation Discussion and Analysis and the related compensation tables and narrative.”
Vote Required
The approval of this proposal requires the affirmative vote of a majority of the votes cast in person or by proxy and entitled to vote thereon at the 2021 annual meeting, assuming that a quorum is present.
Recommendation of the Board
Our Board of Directors unanimously recommends a vote “FOR” the adoption, on a non-binding, advisory basis, of the resolution approving the compensation of our named executive officers described under the heading “Executive Compensation” in our proxy statement.
4. Non-Binding, Advisory Vote on the Frequency of the Stockholder Vote on Executive Compensation
Section 14A also provides that we include in this proxy statement a separate, advisory, non-binding stockholder vote on whether the Say-on-Pay Vote should occur every one, two or three years (Say-When-on-Pay Vote). Stockholders have the option to vote for any one of the three options, or to abstain on the matter.
The Board has determined that an advisory vote on executive compensation every three years is the best approach for the Company based on a number of considerations, including the following:
● An advisory vote every three years would give the Board sufficient time to thoughtfully consider the results of the vote and to implement any desired changes to executive compensation policies and procedures; and
● A three-year cycle would provide investors sufficient time to evaluate the effectiveness of the short- and long-term compensation strategies and related business outcomes of the Company. We believe a short review cycle will not allow for a meaningful evaluation of our performance against our compensation practices, as any adjustment in pay practices would take time to implement and to be reflected in our financial performance and in the price of our common stock.
The stockholders also have the opportunity to provide additional feedback on important matters involving executive compensation even in years when a Say-on-Pay Vote does not occur. As discussed under “Communications with the
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Board” on page 17, the Company provides stockholders an opportunity to communicate directly with the Board on any issue, including executive compensation.
You may indicate your preferred voting frequency by voting for the option of three years, two years, or one year, or you may abstain from voting. We will consider stockholders to have expressed a non-binding preference for the frequency that receives the highest number of favorable votes.
Although this selection is non-binding in nature, our Board and Compensation Committee, which is responsible for designing and administering our executive compensation program, value the opinions expressed by stockholders in their vote on this proposal, and will consider the stockholders’ preference in determining the frequency of future votes on compensation program for our named executive officers. However, the Board may decide that it is in the best interests of our stockholders and the Company to hold a non-binding, advisory Say on Pay Vote more or less frequently than the option selected by our stockholders.
The Board of Directors unanimously recommends that a non-binding, advisory vote to approve the compensation of our named executive officers be held every THREE years.
Vote Required
The approval of this proposal requires the affirmative vote of a majority of the votes cast in person or by proxy and entitled to vote thereon at the 2021 annual meeting, assuming that a quorum is present.
Recommendation of the Board
Our Board of Directors unanimously recommends a vote “FOR” the adoption, on a non-binding, advisory basis, of the resolution approving the Non-Binding, Advisory Vote on the Frequency of the Stockholder Vote on Executive Compensation of our named executive officers described under the heading “Executive Compensation” in our proxy statement.
5. Such Other Business as May Properly Come before the Annual Meeting
We do not know of any other matters to be voted on at the meeting. If, however, other matters are properly presented for a vote at the meeting, the persons named as proxies will vote your properly submitted proxy according to their judgment on those matters.
6 RYERSON HOLDING CORPORATION |
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Composition of the Board of Directors
Our Amended and Restated Certificate of Incorporation and Bylaws provide that the authorized number of directors shall be fixed from time to time by a resolution of the majority of our Board. Our Board is currently comprised of the following seveneight members: Kirk K. Calhoun, Court D. Carruthers, Eva M. Kalawski, Jacob Kotzubei, Stephen P. Larson, Edward J. Lehner, Philip E. Norment and Mary Ann Sigler.
In connection with the IPO, the Company and Platinum entered into an amended and restated investor rights agreement (the “Investor Rights Agreement”) in August 2014 that provided, among other things, that for so long as Platinum collectively beneficially owns (i) at least 30% of the voting power of the outstanding capital stock of the Company, Platinum will have the right to nominate for election to the Board no fewer than that number of directors that would constitute a majority of the number of directors if there were no vacancies on the Board, (ii) at least 15% but less than 30% of the voting power of the outstanding capital stock of the Company, Platinum will have the right to nominate two directors and (iii) at least 5% but less than 15% of the voting power of the outstanding capital stock of the Company, Platinum will have the right to nominate one director. The agreement also provides that if the size of the Board is increased or decreased at any time, Platinum’s nomination rights will be proportionately increased or decreased, respectively, rounded up to the nearest whole number. Under the Investor Rights Agreement, Platinum has nominated Ms. Kalawski, Mr. Kotzubei, Mr. Norment and Ms. Sigler. Our Corporate Governance Guidelines provide that if an officer serving on our Board resigns or retires from his or her executive position with the Company or if a non-management director’s external job changes from the time such director was last elected, such individual shall offer his or her resignation from the Board at the same time; however, whether or not the individual shall continue to serve on the Board is a matter for determination on a case-by-case basis by the Board.
Our Board is divided into three staggered classes of directors of the same or nearly the same number. At each annual meeting of stockholders, a class of directors will be elected for a three-year term to succeed the directors of the same class whose terms are then expiring. The terms of the directors will expire upon election and qualification of successor directors at the annual meeting of stockholders to be held during the years 2021 for the Class I directors, 2022 for the Class II directors, and 2023 for the Class III directors, and 2024 for the Class I directors.
| 2022 Proxy Statement 7 |
Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class shall consist of one-third of the directors. The following table sets forth information as of the date of this proxy statement regarding the nominees for directors and other directors who will serve as directors in the classes and for the terms specified below:
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| Expiration of Current Term | |
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Class I |
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Court D. Carruthers |
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| 48 |
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| 2015 |
| 2021* |
Eva M. Kalawski |
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| 65 |
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| 2007 |
| 2021* |
Mary Ann Sigler |
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| 66 |
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| 2010 |
| 2021* |
Continuing Directors |
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Class II |
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Stephen P. Larson |
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| 64 |
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| 2014 |
| 2022 |
Philip E. Norment |
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| 61 |
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| 2014 |
| 2022 |
Class III |
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Kirk K. Calhoun |
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| 76 |
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| 2014 |
| 2023 |
Jacob Kotzubei |
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| 52 |
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| 2010 |
| 2023 |
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Additional information regarding the nominees and continuing directors is set forth below and is based on information furnished to us by the nominees and directors:
The Board has nominated Mses. Kalawski and Sigler, and Mr. Carruthers for election at the 2021 annual meeting, each to hold office until the annual meeting of stockholders in 2024 (subject to the election and qualification of their successors or the earlier of their death, resignation or removal). Each is currently a director.
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Continuing Directors
Messrs. Calhoun, Kotzubei, Larson and Norment will remain directors after the annual meeting.
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Meetings of the Board and Board Committees
During 2020, our Board met six times. To monitor COVID-19’s impact on our business, our directors held a special meeting with management in April 2020. In addition to the meeting of the full Board, directors also attended meetings of Board committees on which they served. All of the directors attended at least 89% of the meetings of the Board and the committees on which they served. While we do not have a formal policy requiring them to do so, we encourage our
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directors to attend our annual meeting of stockholders. All of our seven directors attended our 2020 annual meeting of stockholders, which we held virtually due to the COVID-19 pandemic.
The standing committees of the Board, with the membership indicated as of February 28, 2021, are set forth in the table below. The Board has an Executive Committee, an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee. The Board also appoints an ad hoc Pricing Committee from time to time as needed. In July 2020, the Pricing Committee comprise of Messrs. Kotzubei, Norment, and Larson met to approve the refinancing of the Company’s senior secured notes.
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Our policies and practices reflect corporate governance standards that comply with the NYSE rules and the corporate governance requirements of the Sarbanes-Oxley Act, including:
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Under our Bylaws, the Board may appoint one of the directors as Chairman of the Board. The Chairman of the Board may be a management or a non-management director and may or may not be the same individual as our CEO (if our CEO is a director), at the option of the Board. The Board believes it should be free to make this determination depending on what it believes is best for the Company in light of all the circumstances. The Company’s CEO is currently not a member of the Board and the Board currently does not have a Chairman of the Board. This leadership structure also allows our CEO to focus his time and energy on operating and managing the Company, and leverages the experiences and perspectives of all of the Company’s directors.
Our directors meet at regularly scheduled executive sessions without management present, usually in conjunction with regularly scheduled Board meetings. In addition, at least once each year the independent directors meet in executive session without any other persons present. One of our independent directors is chosen by the directors at each such session of independent directors to preside over the session.
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Controlled Company Status and Director Independence
As stated above, because Platinum owns more than 50% of the voting power of our common stock, we are considered to be a “controlled company” for purposes of the NYSE rules. As such, we are permitted, and have elected, to opt out of the NYSE rules that would otherwise require our Board to be comprised of a majority of independent directors and require our Compensation Committee and Nominating and Corporate Governance Committee to be comprised entirely of independent directors.
For a director to be considered independent under the NYSE rules, our Board must determine that the director nominee (or director) does not have any material relationship with the Company. To assist in making this determination, our Board adopted a policy on director independence based on the NYSE’s independence standards. A copy of the policy is available on the corporate governance page on our website, which can be found at ir.ryerson.com by clicking on “Governance.”
Under our policy on director independence, a director will be considered independent only if the Board has affirmatively determined that the director has no material relationship with the Company that would impair the director’s independent judgment. In the process of making such determinations, the Board will consider the nature, extent and materiality of the director’s relationships with the Company. When assessing the materiality of a director’s relationship with the Company, the Board should consider the issue not only from the standpoint of the director, but also from that of persons or organizations with which the director has an affiliation. The Board will consider all relevant facts and circumstances in rendering its “independence” determinations. Material relationships can include commercial, banking, consulting, legal, accounting, charitable and familial relationships, among others. In addition, a director will not be deemed “independent” for purposes of service on the Board if such director:
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For purposes of the Company’s policy on director independence, “immediate family member” means any of the person’s spouse, parents, children, siblings, mothers- and fathers-in-law, sons- and daughters-in-law, and brothers-and sisters-in-law and anyone (other than domestic employees) who shares the person’s home.
The Board has determined that Messrs. Calhoun, Carruthers and Larson are, or during 2020 were, independent within the meaning of the NYSE rules or our policy on director independence.
As stated above, our Board of Directors unanimously recommends a vote “FOR” the election of the Board’s nominees identified above.
Our Board as a whole has responsibility for overseeing our risk management. The Board and the Audit Committee assess whether management has an appropriate framework to manage risks and whether that framework is operating effectively. On a regular basis, the Board and its committees engage with management on risk as part of broad strategic and operational discussions which encompass ongoing risks, as well as on a risk-by-risk basis. The Board exercises its oversight responsibility directly and through its committees.
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As a general matter, the Board and its committees are informed by reports from our management team and from our internal audit department that are designed to provide visibility to the Board about the identification and assessment of key risks and our risk mitigation strategies. In carrying out this critical responsibility, the Board has designated the Audit Committee with primary responsibility for overseeing certain enterprise risk management, including financial, cybersecurity, legal, and market risks. The Audit Committee reviews the steps management has taken to monitor and mitigate these risks. With respect to financial, cybersecurity and market risks, the Audit Committee reviews quarterly reports from Ryerson’s internal audit department, General Counsel, and Chief Information Officer.
The Board’s consideration of risk is not limited to discussions during Board and committee meetings. Rather, the Board may communicate with management as a group, or individually, concerning our most significant risks whenever it deems such communications to be appropriate. In addition, each Director has complete access to all of our employees to the extent the Director may have questions concerning a particular risk.
To monitor COVID-19’s initial impact on our business, our Board held a special meeting with management in April 2020, which included presentations and discussion on the evolving risk environment for our employees, operations and financial position. Since then, our Board continues to receive regular updates on COVID-19’s continued impact and risk to our employees, operations and financial position.
Our Compensation Committee is responsible for evaluating risk arising from our compensation policies and practices, management development and succession planning, and employment benefits and policies. Our Nominating and Governance Committee manages risks related to Board composition and succession planning, Director independence, governance, and corporate compliance and reporting obligations. In addition to overseeing certain enterprise risk management, our Audit Committee assists the Board in monitoring the Company’s compliance with legal and regulatory requirements as well as its ethical standards and policies. It also oversees our internal audit function. The committees provide reports to the full Board regarding these and other matters.
Under its charter, the internal audit department is tasked to help the Company accomplish its objectives by bringing a systematic and disciplined approach to evaluate and improve the effectiveness of the Company’s risk management, control and governance processes. To promote independence of the department and ensure appropriate internal audit coverage, the internal audit director is responsible for leading the department and reports functionally to the Audit Committee, and administratively (i.e., day-to-day operations) to the chief financial officer. The internal audit services personnel have unrestricted access to all functions, records, property and personnel of the Company, and full and free access to the Audit Committee. The internal audit department is currently staffed entirely by a third-party auditing firm.
The scope of the department’s internal auditing encompasses, but is not limited to, the examination and evaluation of the adequacy and effectiveness of the Company’s governance, risk management and internal controls, as well as the quality of performance in carrying out assigned responsibilities to achieve the Company’s stated goals and objectives. This includes, among other things:
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The internal audit department provides reports on these items to the Audit Committee at each regularly scheduled Audit Committee meeting. In addition, the internal audit department is responsible for conducting an annual risk assessment and developing a corresponding annual audit plan using a risk-based approach to monitor and report on the adequacy and effectiveness of the Company’s processes for controlling its activities and managing its risks.
Governance Guidelines and Committee Charters
We maintain a corporate governance page on our website that includes our Corporate Governance Guidelines, Code of Ethics and Business Conduct and the charters for our Audit, Compensation and Nominating and Corporate Governance Committees. The corporate governance page can be found at ir.ryerson.com by clicking on “Governance.” Stockholders also may obtain copies of these materials by contacting us at Investor Relations, 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606, email: investorinfo@ryerson.com, or telephone: 312-292-5130.
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Our Board has adopted a code of ethics (“Code of Ethics”) that contains the ethical principles by which our chief executive officer and chief financial officer, among others, are expected to conduct themselves when carrying out their duties and responsibilities. A copy of the Code of Ethics may be found at the end of our general code of ethics and business conduct, available on our corporate governance webpage located at ir.ryerson.com. We will provide a copy of our general code of ethics and business conduct, which includes the Code of Ethics, to any person, without charge, upon request, by writing to the Chief Compliance Officer, Ryerson Holding Corporation, 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606 (telephone number: 312-292-5000). We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to, or waiver from, a provision of our Code of Ethics by posting such information on the corporate governance page on our website, which can be found at ir.ryerson.com by clicking on “Governance.”
An employee, officer or other interested party who has an interest in communicating with the Board may do so by directing the communication to the General Counsel of the Company. Persons who desire to communicate with the directors should send their correspondence addressed to the attention of the General Counsel, c/o Ryerson Holding Corporation, 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606. The General Counsel will provide a summary of all appropriate communications to the addressed directors.
Board Committees
In December 2014, the Board established an Executive Committee in accordance with our Bylaws. The Executive Committee has and may exercise all powers that the Board legally delegates to it. In addition, during the intervals between meetings of the Board, the Executive Committee has and may exercise all of the powers of the Board, other than such powers as are granted to the Audit Committee, the Compensation Committee or the Nominating and Corporate Governance Committee, in the management of the business and affairs of the Corporation, unless otherwise limited by a resolution of the Board, the Company’s Amended and Restated Certificate of Incorporation or Bylaws, or applicable law. The Executive Committee is convened when circumstances do not allow the time, or when it is otherwise not practicable, for the entire Board to meet. The Executive Committee consists of Messrs. Kotzubei, Larson and Norment. In 2020, the Executive Committee did not meet.
Nominating and Corporate Governance Committee
Our Nominating and Corporate Governance Committee (the “Governance Committee”) considers and oversees all corporate governance issues as they arise and develops appropriate recommendations for the Board regarding those issues. It is also responsible for reviewing the requisite skills and characteristics of the members of the Board. In 2020, the Governance Committee met twice. The Governance Committee consists of Mr. Norment and Mses. Kalawski and Sigler. Because Platinum owns more than 50% of the voting power of our common stock, we are considered to be a “controlled company” for the purposes of the NYSE rules. As such, we are permitted, and have elected, to opt out of the NYSE rules that would otherwise require our Governance Committee to be comprised entirely of independent directors.
Our Board has adopted a written charter for the Governance Committee, pursuant to which the Governance Committee has, among others, the following responsibilities:
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In selecting or recommending candidates to serve as directors, the Governance Committee takes into consideration the following criteria as approved by the Board, and as modified by the Board from time to time, and such other factors as it deems appropriate:
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The Governance Committee will consider all candidates recommended by the Company’s stockholders in accordance with the procedures set forth in the Company’s annual proxy statement. The Governance Committee may also consider candidates proposed by management. For additional information, see “Stockholder Nominations for Directors,” below on page 53.
Our Audit Committee oversees a broad range of issues surrounding our accounting and financial reporting processes and audits of our financial statements. In 2020, the Audit Committee met four times. The Audit Committee consists of Messrs. Calhoun, Carruthers and Larson. Each of Messrs. Calhoun, Carruthers and Larson are “independent” as such term is defined in Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and under the applicable NYSE rules. Each is “financially literate,” and Mr. Calhoun, the chair of the Audit Committee, is an “audit committee financial expert” as defined in Item 407(d)(5) of Regulation S-K.
Our Board has adopted a written charter for the Audit Committee, pursuant to which the Audit Committee has, among others, the following responsibilities:
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The Audit Committee also reviews related party transactions. For additional information regarding our related party policy, see “Related Party Transactions,” below on page 51.
Audit, Audit-related and Other Non-Audit Services
Consistent with SEC policies regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation for and overseeing the work of Ernst & Young, our independent registered public accounting firm. In recognition of this responsibility, the Audit Committee has established a policy to pre-approve all audit and permissible non-audit services provided by Ernst & Young. For additional information regarding the services provided by Ernst & Young and the fees for such services, see “Ratification of Appointment of Independent Registered Public Accounting Firm,” above on page 7.
The Audit Committee must pre-approve any audit or any permissible non-audit services to be provided by the independent registered public accounting firm. The Audit Committee has established pre-approval policies and procedures. Permissible non-audit services are services allowed under SEC regulations. The Audit Committee may pre-approve certain specific categories of permissible non-audit services up to an annual budgeted dollar limit. If any permissible non-audit services do not fall within a pre-approved category, or exceed the approved fees or budgeted amount, the services and the additional fees have to be pre-approved by the Audit Committee on a project-by-project basis. The Audit Committee may delegate to any member of the Committee the duty to pre-approve any payments of compensation to the independent registered public accounting firm, provided that the decisions of such member to grant pre-approvals shall be presented to the full Committee for ratification.
No required pre-approvals were waived or approved after the services commenced. Before approving the non-audit services described as “Tax Fees” under “Ratification of Appointment of Independent Registered Public Accounting Firm,” above on page 7, the Audit Committee reviewed whether the independent registered public accounting firm could provide those services and maintain its independence. The Audit Committee approved 100% of the audit-related and tax fees for 2020 and 2019.
The Audit Committee has adopted policies to ensure the independence of the Company’s independent registered public accounting firm, including policies on employment of audit firm employees and audit partner rotation.
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Audit Committee Report – Financial Statements Recommendation1
Management is responsible for the preparation, presentation and integrity of Ryerson’s consolidated financial statements and the reporting process including Ryerson’s internal controls over financial reporting and their effectiveness. The independent registered public accounting firm of Ernst & Young LLP (“EY”) is responsible for performing an independent audit of Ryerson’s consolidated financial statements. The Audit Committee’s responsibility is to monitor and oversee these activities and processes. In this context, the Audit Committee reports as follows:
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Based on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited financial statements referred to above be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, for filing with the Securities and Exchange Commission.
Respectfully submitted by the Audit Committee:
Kirk K. Calhoun, Chair
Court D. Carruthers
Stephen P. Larson
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Our Compensation Committee reviews and recommends policies relating to compensation and benefits of our officers and employees, including reviewing and approving corporate goals and objectives relevant to the compensation of our chief executive officer and other named executive officers, evaluating the performance of those officers in light of those goals and objectives and setting compensation of those officers based on such evaluations. In 2020, the Compensation Committee met two times. The Compensation Committee consists of Messrs. Calhoun and Kotzubei and Ms. Sigler. Because Platinum owns more than 50% of the voting power of our common stock, we are considered to be a “controlled company” for the purposes of the NYSE rules. As such, we are permitted, and have elected, to opt out of the NYSE rules that would otherwise require our Compensation Committee to be comprised entirely of independent directors.
Our Board has adopted a written charter for the Compensation Committee, pursuant to which the Compensation Committee has, among others, the following authority to fulfill its duties and responsibilities:
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In addition, the Compensation Committee reviews the results of the stockholder advisory votes on (i) executive compensation, and (ii) the frequency of the stockholder votes on executive compensation.
Committee Resources and Authority
Under the Compensation Committee’s charter, the Committee also has the resources and authority to:
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In addition, the Committee may form and delegate its authority to subcommittees or to the Committee Chair when it deems appropriate and in the best interests of the Company, although it did not do so in 2020. Since 2016, Ryerson management, at the Compensation Committee’s request, has engaged Compensation Advisory Partners, (“CAP”) (formerly known as Vivient Consulting LLC prior to its acquisition by CAP), an independent executive compensation consultant, to assist in planning for the Company’s executive compensation program.
Compensation Committee Interlocks and Insider Participation
Mr. Kotzubei, Mr. Calhoun and Ms. Sigler served on our Compensation Committee during all of the last completed fiscal year. None of our executive officers serves as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board or our Compensation Committee. None of the members of the Compensation Committee is now an employee of the Company. Prior to the IPO, Ms. Sigler served as the Company’s Vice President. She resigned her position as an officer in August 2014 in connection with the IPO and has not served as an officer of the Company since that time.
Compensation Committee Report1
The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis section of this Proxy Statement, set forth below. Based on such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and be incorporated by reference into the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020.
Respectfully submitted by the Compensation Committee:
Jacob Kotzubei, Chair
Kirk K. Calhoun
PHILIP E. NORMENT Director since: April 2014
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Continuing Directors
Mses. Kalawski and Sigler and Messrs. Calhoun, Carruthers, Kotzubei, and Lehner will remain directors after the annual meeting.
Name | Fees Earned or Paid in Cash(1) | Total | ||||||||
| $ | 171,300 |
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| $ | 171,300 |
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Court D. Carruthers(3) |
| $ | 155,550 |
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| $ | 155,550 |
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Stephen P. Larson(4) |
| $ | 156,600 |
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| $ | 156,600 |
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Eva M. Kalawski |
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Jacob Kotzubei |
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Philip E. Norment |
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Mary Ann Sigler |
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Director since: August 2014 Public Company Directorships: NantHealth, Inc. (NASDAQ: NH) PLx Pharma, Inc. (NASDAQ: PLXP) | Kirk K. Calhoun joined the public accounting firm Ernst & Young LLP in 1965 and served as a partner of the
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2022 Proxy Statement 9 |
COURT D. CARRUTHERS Director since: August 2015 Public Company Directorships: US Foods Holding Corp. (NYSE: USFD) | Court D. Carruthers serves as President and CEO of TricorBraun, Inc., a global packaging solutions company, where he is also a director. He is the founder and principal of CKAL Advisory Partners, LLC, which provides private equity advisory services. He previously served as Senior Vice President and Group President, Americas, of W.W. Grainger, Inc., a broad-line supplier of maintenance, repair and operating (MRO) products, from 2013 until July 2015. Prior to that time, he had served as President, Grainger U.S., from 2012 until 2013; President, Grainger International, from 2009 until 2012; and President, Acklands-Grainger, from 2006 until 2009. He was appointed a Senior Vice President of Grainger in 2007. Mr. Carruthers serves on the board of directors and the audit committee of US Foods Holding Corp. He is a past director of a number of private and public companies including Monotaro, PSS Companies, Shoes for Crews, Follett Corp., and Foundation Building Materials, Inc. Mr. Carruthers currently serves on the boards of WC Hockey NFP and the Gorton Community Center. He is a Chartered Professional Accountant (Canada, nonpracticing), a Fellow of the Chartered Professional Accountants of Canada (FCPA, FCMA), and an Institute-Certified Director by the Institute of Corporate Directors. He holds a Bachelor of Commerce degree from the University of Alberta in Edmonton, Alberta, Canada, and a Master of Business Administration from Queens University in Kingston, Ontario, Canada. His substantial prior experience as a senior executive for a large international distribution company has led the Board to conclude that Mr. Carruthers has the background and |
EVA M. KALAWSKI Director since: July 2007 | Eva M. Kalawski joined Platinum in 1997, is a former Partner at Platinum and |
JACOB KOTZUBEI Director since: January 2010 Public Company Directorships: KEMET Corp. (NYSE: KEM) Verra Mobility Corporation (NASDAQ: CRRM) Vertiv Holding Co (NYSE: VRT) | Jacob Kotzubei joined Platinum in 2002 and is a Partner at the firm. Mr. Kotzubei serves as a director of a number of Platinum’s portfolio companies. Prior to joining Platinum in 2002, Mr. Kotzubei was a Vice President of the Goldman Sachs Investment Banking Division – High Tech Group in New York City, and the head of the East Coast Semiconductor Group. Previously, he was an attorney at Sullivan & Cromwell LLP in New York City, specializing in mergers and acquisitions. Mr. Kotzubei received a Bachelor’s degree from Wesleyan University and holds a Juris Doctor from Columbia University School of Law. Mr. Kotzubei serves on
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10 RYERSON HOLDING CORPORATION |
EDWARD J. LEHNER Director since: February | Edward J. Lehner |
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MARY ANN SIGLER Director since: January 2010 | Mary Ann Sigler serves as Platinum’s Chief Financial Officer and Chief Compliance Officer. Ms. Sigler joined Platinum in 2004 and is responsible for overall accounting, tax and financial reporting as well as managing strategic planning projects for the firm. Prior to joining Platinum, Ms. Sigler was with Ernst & Young LLP for 25 years where she was a Partner. Ms. Sigler holds a Master of Business Taxation from the University of Southern California and a Bachelor of Arts in Accounting from the California State University at Fullerton. Ms. Sigler is a Certified Public Accountant in California, as well as a member of the American Institute of Certified Public Accountants and the California Society of Certified Public Accountants. She previously served on the board of directors of Key Energy Services, Inc. Ms. Sigler’s experience in accounting and strategic planning matters has led the Board to conclude that she has the requisite qualifications to serve as a director of the Company and facilitate its continued growth. |
Meetings of the Board and Board Committees
During 2021, our Board met five times. In addition to the meeting of the full Board, directors also attended meetings of Board committees on which they served. All of the directors attended at least 75% of the meetings of the Board and the committees on which they served. While we do not have a formal policy requiring them to do so, we encourage our directors to attend our annual meeting of stockholders.
All of our directors attended our 2021 annual meeting of stockholders, which we held virtually due to the COVID-19 pandemic and to facilitate our stockholders’ attendance.
Our policies and practices reflect corporate governance standards that comply with the NYSE rules and the corporate governance requirements of the Sarbanes-Oxley Act, including:
O | Our Board adopted clear corporate governance policies, including standards for determining director independence, and all our directors except for Mr. Lehner, our CEO, are independent; |
O | Our Board committee charters clearly establish their respective roles and responsibilities; |
O | Our directors meet regularly in executive session without management present; |
O | We have a code of ethics and business conduct that applies to all Ryerson directors, officers and associates; |
O | Our chief executive officer, chief financial officer and other senior financial officers are subject to an additional code of ethics to promote (i) honest and ethical conduct; (ii) full, fair, accurate, timely and understandable disclosure in SEC filings; and (iii) compliance with applicable laws, rules and regulations; |
O | Our internal audit function maintains critical oversight over the key areas of our business, compliance processes and controls, and reports regularly to the Audit Committee; |
O | We have a compliance hotline service that permits employees to report violations of our code of ethics or other issues of significant concern on a confidential basis, via a toll-free telephone number or the Internet; and |
O | Concerns related to the Company’s financial statements, accounting practices, or internal controls may be communicated in writing to the Company’s Audit Committee. |
2022 Proxy Statement 11 |
Under our Bylaws, the Board may appoint one of the directors as Chairman of the Board. The Chairman of the Board may be a management or a non-management director and may or may not be the same individual as our CEO (if our CEO is a director), at the option of the Board. The Board believes it should be free to make this determination depending on what it believes is best for the Company in light of all the circumstances. The Board appointed the Company’s CEO to the Board on February 17, 2022. The Board currently does not have a Chairman of the Board. This leadership structure also allows our CEO to focus his time and energy on operating and managing the Company, and leverages the experiences and perspectives of all of the Company’s directors.
Our directors meet at regularly scheduled executive sessions without management present, usually in conjunction with regularly scheduled Board meetings. In addition, at least once each year the independent directors meet in executive session without any other persons present. One of our independent directors is chosen by the directors at each such session of independent directors to preside over the session.
All our directors except for Mr. Lehner, our CEO, are independent. For a director to be considered independent under the NYSE rules, our Board must determine that the director nominee (or director) does not have any material relationship with the Company. To assist in making this determination, our Board adopted a policy on director independence based on the NYSE’s independence standards. A copy of the policy is available on the corporate governance page on our website, which can be found at ir.ryerson.com by clicking on “Governance.”
Under our policy on director independence, a director will be considered independent only if the Board has affirmatively determined that the director has no material relationship with the Company that would impair the director’s independent judgment. In the process of making such determinations, the Board will consider the nature, extent and materiality of the director’s relationships with the Company. When assessing the materiality of a director’s relationship with the Company, the Board should consider the issue not only from the standpoint of the director, but also from that of persons or organizations with which the director has an affiliation. The Board will consider all relevant facts and circumstances in rendering its “independence” determinations. Material relationships can include commercial, banking, consulting, legal, accounting, charitable and familial relationships, among others. In addition, a director will not be deemed “independent” for purposes of service on the Board if such director:
1. | is, or has been within the last three years, an employee of the Company, or an immediate family member of such director is, or has been within the last three years, an executive officer of the Company; |
2. | has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than $120,000 in direct compensation from the Company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service); |
3. | (A) is a current partner or employee of a firm that is the Company’s internal or external auditor; (B) has an immediate family member who is a current partner of such a firm; (C) has an immediate family member who is a current employee of such a firm and personally works on the Company’s audit; or (D) was, or has an immediate family member who was, within the last three years a partner or employee of such a firm and personally worked on the Company’s audit within that time; |
4. | is, or an immediate family member of such director is, or has been within the last three years, employed as an executive officer of another company where any of the Company’s present executive officers at the same time serves or served on that company’s compensation committee; or |
5. | is a current employee, or has an immediate family member who is a current executive officer, of a company that has made payments to, or received payments from, the Company for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1,000,000, or 2% of such other company’s consolidated gross revenues. |
For purposes of the Company’s policy on director independence, “immediate family member” means any of the person’s spouse, parents, children, siblings, mothers- and fathers-in-law, sons- and daughters-in-law, and brothers-and sisters-in-law and anyone (other than domestic employees) who shares the person’s home.
The Board has determined that Messrs. Calhoun, Carruthers and Larson are, or during 2021 were, independent within the meaning of the NYSE rules or our policy on director independence. Further, on February 17, 2022, the Board determined that Mses. Kalawski and Sigler, and Messrs. Kotzubei and Norment were independent within the meaning of the NYSE rules or our policy on director independence.
12 RYERSON HOLDING CORPORATION |
As stated above, our Board of Directors unanimously recommends a vote “FOR” the election of the Board’s nominees identified above.
Our Board as a whole has responsibility for overseeing our risk management. The Board and the Audit Committee assess whether management has an appropriate framework to manage risks and whether that framework is operating effectively. On a regular basis, the Board and its committees engage with management on risk as part of broad strategic and operational discussions which encompass ongoing risks, as well as on a risk-by-risk basis. The Board exercises its oversight responsibility directly and through its committees.
As a general matter, the Board and its committees are informed by reports from our management team and from our internal audit department that are designed to provide visibility to the Board about the identification and assessment of key risks and our risk mitigation strategies. In carrying out this critical responsibility, the Board has designated the Audit Committee with primary responsibility for overseeing certain enterprise risk management, including financial, cybersecurity, legal, and market risks. The Audit Committee reviews the steps management has taken to monitor and mitigate these risks. With respect to financial, cybersecurity and market risks, the Audit Committee reviews quarterly reports from Ryerson’s internal audit department, General Counsel, and Chief Information Officer.
The Board’s consideration of risk is not limited to discussions during Board and committee meetings. Rather, the Board may communicate with management as a group, or individually, concerning our most significant risks whenever it deems such communications to be appropriate. In addition, each Director has complete access to all of our employees to the extent the Director may have questions concerning a particular risk.
Our Compensation Committee is responsible for evaluating risk arising from our compensation policies and practices, management development and succession planning, and employment benefits and policies. Our Nominating and Governance Committee manages risks related to Board composition and succession planning, Director independence, governance, and corporate compliance and reporting obligations. In addition to overseeing certain enterprise risk management, our Audit Committee assists the Board in monitoring the Company’s compliance with legal and regulatory requirements as well as its ethical standards and policies. It also oversees our internal audit function. The committees provide reports to the full Board regarding these and other matters.
Under its charter, the internal audit department is tasked to help the Company accomplish its objectives by bringing a systematic and disciplined approach to evaluate and improve the effectiveness of the Company’s risk management, control and governance processes. To promote independence of the department and ensure appropriate internal audit coverage, the internal audit director is responsible for leading the department and reports functionally to the Audit Committee, and administratively (i.e., day-to-day operations) to the chief financial officer. The internal audit services personnel have unrestricted access to all functions, records, property and personnel of the Company, and full and free access to the Audit Committee. The internal audit department is currently staffed entirely by a third-party auditing firm.
The scope of the department’s internal auditing encompasses, but is not limited to, the examination and evaluation of the adequacy and effectiveness of the Company’s governance, risk management and internal controls, as well as the quality of performance in carrying out assigned responsibilities to achieve the Company’s stated goals and objectives. This includes, among other things:
Ο | partnering with other governance and monitoring groups to evaluate risk exposure relating to achievement of the Company’s strategic objectives; |
Ο | monitoring and evaluating the effectiveness of the Company’s risk management processes; |
Ο | performing consulting and advisory services related to governance, risk management and control as appropriate for the Company; and |
Ο | reporting significant risk exposures and control issues, including fraud risks, governance issues, cybersecurity risks, and other matters needed or requested by the Audit Committee. |
The internal audit department provides reports on these items to the Audit Committee at each regularly scheduled Audit Committee meeting. In addition, the internal audit department is responsible for conducting an annual risk assessment and developing a corresponding annual audit plan using a risk-based approach to monitor and report on the adequacy and effectiveness of the Company’s processes for controlling its activities and managing its risks.
2022 Proxy Statement 13 |
Governance Guidelines and Committee Charters
We maintain a corporate governance page on our website that includes our Corporate Governance Guidelines, Code of Ethics and Business Conduct and the charters for our Audit, Compensation and Nominating and Corporate Governance Committees. The corporate governance page can be found at ir.ryerson.com by clicking on “Governance.” Stockholders also may obtain copies of these materials by contacting us at Investor Relations, 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606, email: investorinfo@ryerson.com, or telephone: 312-292-5130.
Our Board has adopted a code of ethics (“Code of Ethics”) that contains the ethical principles by which our chief executive officer and chief financial officer, among others, are expected to conduct themselves when carrying out their duties and responsibilities. A copy of the Code of Ethics may be found at the end of our general code of ethics and business conduct, available on our corporate governance webpage located at ir.ryerson.com. We will provide a copy of our general code of ethics and business conduct, which includes the Code of Ethics, to any person, without charge, upon request, by writing to the Chief Compliance Officer, Ryerson Holding Corporation, 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606 (telephone number: 312-292-5000). We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to, or waiver from, a provision of our Code of Ethics by posting such information on the corporate governance page on our website, which can be found at ir.ryerson.com by clicking on “Governance.”
An employee, officer or other interested party who has an interest in communicating with the Board may do so by directing the communication to the General Counsel of the Company. Persons who desire to communicate with the directors should send their correspondence addressed to the attention of the General Counsel, c/o Ryerson Holding Corporation, 227 W. Monroe St., 27th Floor, Chicago, Illinois 60606. The General Counsel will provide a summary of all appropriate communications to the addressed directors.
In December 2014, the Board established an Executive Committee in accordance with our Bylaws. The Executive Committee has and may exercise all powers that the Board legally delegates to it. In addition, during the intervals between meetings of the Board, the Executive Committee has and may exercise all of the powers of the Board, other than such powers as are granted to the Audit Committee, the Compensation Committee or the Nominating and Corporate Governance Committee, in the management of the business and affairs of the Corporation, unless otherwise limited by a resolution of the Board, the Company’s Amended and Restated Certificate of Incorporation or Bylaws, or applicable law. The Executive Committee is convened when circumstances do not allow the time, or when it is otherwise not practicable, for the entire Board to meet. The Executive Committee consists of Messrs. Kotzubei, Larson and Norment. In 2021, the Executive Committee did not meet.
Nominating and Corporate Governance Committee
Our Nominating and Corporate Governance Committee (the “Governance Committee”) considers and oversees all corporate governance issues as they arise and develops appropriate recommendations for the Board regarding those issues. It is also responsible for reviewing the requisite skills and characteristics of the members of the Board. In 2021, the Governance Committee met twice. The Governance Committee consists of Mr. Norment and Mses. Kalawski and Sigler. Our Governance Committee is comprised entirely of independent directors.
Our Board has adopted an amended and restated written charter for the Governance Committee, pursuant to which the Governance Committee has, among others, the following responsibilities:
Ο | Oversee and assist our Board in identifying, reviewing and recommending nominees for election as directors and for appointment to Board committees; |
Ο | Review and evaluate the overall effectiveness and functioning of the management and the Board and the compliance of the Board with applicable legal requirements; |
Ο | Review and evaluate the composition and performance of the other Board committees, and recommend any changes to the composition, size and functions of each committee; |
Ο | Develop, review and recommend corporate governance guidelines; and |
Ο | Generally advise our Board on corporate governance and related matters. |
14 RYERSON HOLDING CORPORATION |
In selecting or recommending candidates to serve as directors, the Governance Committee takes into consideration the following criteria as approved by the Board, and as modified by the Board from time to time, and such other factors as it deems appropriate:
(i) | high personal and professional ethics, values and integrity; |
(ii) | education, skill and experience that the Board deems relevant and useful, including whether such attributes or background would contribute to the diversity of the Board as a whole; |
(iii) | diversity, including, but not limited to race, ethnicity, gender, LGBTQ+, |
(iv) | ability and willingness to serve on any committees of the Board; and |
(i) | ability and willingness to commit adequate time to the proper functioning of the Board and its committees. |
The Governance Committee will consider all candidates recommended by the Company’s stockholders in accordance with the procedures set forth in the Company’s annual proxy statement. The Governance Committee may also consider candidates proposed by management. For additional information, see “Stockholder Nominations for Directors,” below on page 47.
Our Audit Committee oversees a broad range of issues surrounding our accounting and financial reporting processes and audits of our financial statements. In 2021, the Audit Committee met four times. The Audit Committee consists of Messrs. Calhoun, Carruthers and Larson. Each of Messrs. Calhoun, Carruthers and Larson are “independent” as such term is defined in Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and under the applicable NYSE rules. Each is “financially literate,” and Mr. Calhoun, the chair of the Audit Committee, is an “audit committee financial expert” as defined in Item 407(d)(5) of Regulation S-K.
Our Board has adopted a written charter for the Audit Committee, pursuant to which the Audit Committee has, among others, the following responsibilities:
Ο | Review and recommend to the Board the independent auditors to be selected to audit the financial statements; |
Ο | Inquire as to the independence of the independent auditors and obtain from the independent auditors, on a periodic basis, a formal written statement delineating all relationships between the independent auditors and the Company; in addition, review the extent of non-audit services provided by the independent auditors in relation to the objectivity needed in the independent audit and recommend that the Board take appropriate action in response to the independent auditors’ written statement to satisfy the Board as to the independent auditors’ independence; |
Ο | Pre-approve all services provided by the independent auditors to the Company; |
Ο | Pre-approve appropriate funding for payment of (a) compensation to the Company’s independent auditors for preparing or issuing an audit report or performing other audit, review or attest services for the Company, (b) compensation to any advisors employed by the Committee and (c) ordinary administrative expenses necessary or appropriate to carry out its duties; |
Ο | Ensure proper audit partner rotation; |
Ο | Meet with the independent auditors and the financial management to review the scope of the audit proposed for the current year and the audit procedures to be utilized and at its conclusion review the audit with the Committee; upon completion of the audit and following each interim review of the Company’s financial statements, discuss with the independent auditors all matters required to be communicated to the Committee under generally accepted auditing standards, including the judgments of the independent auditors with respect to the quality, not just the acceptability, of the Company’s accounting principles and underlying estimates in the financial statements; |
Ο | Review with the independent auditors, the internal auditor (if any) and the financial and accounting personnel, the adequacy of the accounting and financial controls and elicits any recommendations for improvement or particular areas where augmented controls are desirable; |
Ο | Review the internal audit function of the Company including the independence and authority of its reporting obligations, the audit plans proposed for the coming year and the coordination of such plans with the work of the independent auditors; |
Ο | Receive before each meeting a summary of findings from completed internal audits and a progress report on the proposed internal audit plan with explanations for any deviations from the original plan; |
2022 Proxy Statement 15 |
Ο | Review the financial statements contained in the annual and quarterly reports with management and the independent auditors; |
Ο | Review any year-to-year changes in accounting principles or practices; |
Ο | Provide sufficient opportunity at each meeting for the internal and independent auditors to meet with the Committee without management present; among the items to be discussed in these meetings are the independent auditors’ evaluation of the financial, accounting and auditing personnel, and their cooperation during the audit; |
Ο | Review with the independent auditors any problems or difficulties the auditors may have encountered, including any disagreements with management; |
Ο | Review accounting and financial personnel and succession planning; |
Ο | Oversee the cybersecurity program, including mitigation efforts related to cybersecurity risks; |
Ο | Investigate any matter brought to its attention within the scope of its duties, with the power to retain professional advice (at the expense of the Company) for this purpose if, in its judgment, that is appropriate; and |
Ο | Establish, as necessary, detailed pre-approval policies and procedures for engaging audit and non-audit services. |
The Audit Committee also reviews related party transactions. For additional information regarding our related party policy, see “Related Party Transactions,” below on page 45.
Audit, Audit-related and Other Non-Audit Services
Consistent with SEC policies regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation for and overseeing the work of Ernst & Young, our independent registered public accounting firm. In recognition of this responsibility, the Audit Committee has established a policy to pre-approve all audit and permissible non-audit services provided by Ernst & Young. For additional information regarding the services provided by Ernst & Young and the fees for such services, see “Ratification of Appointment of Independent Registered Public Accounting Firm,” above on page 6.
The Audit Committee has established policies and procedures pursuant to which any audit or any permissible non-audit services to be provided by the independent registered public accounting firm must be pre-approved by the Committee or its delegates. At least quarterly, the Audit Committee reviews and, if appropriate, pre-approves services to be performed by the independent auditor, reviews a report summarizing fiscal year-to-date services provided by the independent auditor, and reviews any updated projection of the fiscal year’s estimated fees. The Audit Committee may delegate to any member of the Committee the duty to pre-approve any payments of compensation to the independent registered public accounting firm, provided that the decisions of such member to grant pre-approvals shall be presented to the full Committee for ratification.
No required pre-approvals were waived or approved after the services commenced. Before approving the non-audit services described as “Tax Fees” under “Ratification of Appointment of Independent Registered Public Accounting Firm,” above on page 6, the Audit Committee reviewed whether the independent registered public accounting firm could provide those services and maintain its independence. The Audit Committee approved 100% of the audit-related fees tax fee and other fees for 2021 and 2020.
The Audit Committee has adopted policies to ensure the independence of the Company’s independent registered public accounting firm, including policies on employment of audit firm employees and audit partner rotation.
16 RYERSON HOLDING CORPORATION |
Audit Committee Report – Financial Statements Recommendation1
Management is responsible for the preparation, presentation and integrity of Ryerson’s consolidated financial statements and the reporting process including Ryerson’s internal controls over financial reporting and their effectiveness. The independent registered public accounting firm of Ernst & Young LLP (“EY”) is responsible for performing an independent audit of Ryerson’s consolidated financial statements. The Audit Committee’s responsibility is to monitor and oversee these activities and processes. In this context, the Audit Committee reports as follows:
1. | The Audit Committee has reviewed and discussed with management Ryerson’s audited consolidated financial statements as of and for the year ended December 31, 2021 and management has represented that the consolidated financial statements were prepared in accordance with generally accepted accounting principles; |
2. | The Audit Committee has discussed with EY the matters required to be discussed by Public Company Accounting Oversight Board (“PCAOB”) Auditing Standard No. 1301 (Communications with Audit Committees) and the Securities and Exchange Commission; and |
3. | The Audit Committee received the written disclosures and the letter from EY required by applicable requirements of the PCAOB regarding EY’s communications with the Audit Committee concerning independence and has discussed with EY its independence. |
Based on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited financial statements referred to above be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, for filing with the Securities and Exchange Commission.
Respectfully submitted by the Audit Committee:
Kirk K. Calhoun, Chair
Court D. Carruthers
Stephen P. Larson
1 | The information contained in this report shall not be deemed to be “soliciting material” or to be “filed” with the Commission, nor shall such information or report be incorporated by reference into any future filing by us under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that we specifically incorporate it by reference in such filing. |
2022 Proxy Statement 17 |
Our Compensation Committee reviews and recommends policies relating to compensation and benefits of our officers and employees, including reviewing and approving corporate goals and objectives relevant to the compensation of our chief executive officer and other named executive officers, evaluating the performance of those officers in light of those goals and objectives and setting compensation of those officers based on such evaluations. In 2021, the Compensation Committee met three times. The Compensation Committee consists of Messrs. Calhoun and Kotzubei and Ms. Sigler, all of whom were deemed independent as of February 2022.
Our Board has adopted a written charter for the Compensation Committee, pursuant to which the Compensation Committee has, among others, the following authority to fulfill its duties and responsibilities:
Ο | Review, revise and interpret the Company’s compensation philosophy, policies and objectives, including reviewing and approving any incentive compensation plans and equity-based plans of the Company; and the Compensation Committee shall report its determinations and any actions it takes with respect to the Company’s compensation philosophy, policies and objectives to the Board; |
Ο | Review and approve annually the corporate goals and objectives applicable to the compensation of the Company’s CEO, evaluate at least annually the CEO’s performance in light of those goals and objectives, and determine and approve the CEO’s compensation level based on this evaluation; the Committee’s decisions regarding performance goals and objectives and the compensation of the CEO are reviewed and ratified by the Board; in determining the long-term incentive component of the CEO’s compensation, the Committee shall consider all relevant factors, including the Company’s performance and relative stockholder return, the value of similar awards to chief executive officers at comparable companies and the awards given to the CEO in past years; |
Ο | Review and approve the compensation for executive officers, including the review and approval of the design and implementation of any incentive arrangements, equity compensation and supplemental retirement programs; |
Ο | Review and approve grants and awards to officers and other participants under the Company’s compensation and participation plans, including the Company’s management incentive plans; |
Ο | Review and make recommendations to the Board regarding the amount and types of compensation that should be paid to the Company’s outside directors, to ensure that such pay levels remain competitive; |
Ο | Review and approve any employment, severance or termination arrangements to be made with any executive officer of the Company; |
Ο | Review all equity compensation plans under the listing standards of the NYSE or such other national securities exchange or stock market on which the Company’s securities may be listed and approve such plans in the Committee’s sole discretion; |
Ο | Annually assist management in drafting the Company’s Compensation Discussion and Analysis (“CD&A”) to be included in the Company’s public filings with the Securities and Exchange Commission by (i) articulating the discussion and analysis to be included in the CD&A, (ii) participating in or overseeing the drafting of the CD&A and (iii) reviewing the CD&A with management and determining whether to recommend to the Board that the CD&A be included in the Company’s annual report on Form 10-K or proxy statement, as applicable; |
Ο | Prepare a report annually to be filed with the Company’s annual report on Form 10-K or proxy statement, as applicable, to state whether the Committee has reviewed and discussed the CD&A with management and, based on such review and discussions, whether the Committee has recommended to the Board that the CD&A be included in the Company’s annual report on Form 10-K or proxy statement, as applicable; and |
Ο | Submit a report to the Board periodically, which shall include a review of any determinations, recommendations or issues that arise with respect to Company compensation philosophy, policies and objectives, executive compensation, management succession planning and any other matters that the Committee deems appropriate or is requested to be included by the Board. |
In addition, the Compensation Committee reviews the results of the stockholder advisory votes on (i) executive compensation, and (ii) the frequency of the stockholder votes on executive compensation.
18 RYERSON HOLDING CORPORATION |
Committee Resources and Authority
Under the Compensation Committee’s charter, the Committee also has the resources and authority to:
Ο | Retain compensation consultants, independent counsel and other advisors; |
Ο | Terminate any consulting firms and such other advisors; |
Ο | Approve the consulting firms’ and other advisors’ fees and other retention terms; and |
Ο | Determine the appropriate funding (at the expense of the Company) for (i) payment of compensation to any independent counsel and other advisers employed by the Committee and (ii) ordinary administrative expenses of the Committee. |
In addition, the Committee may form and delegate its authority to subcommittees or to the Committee Chair when it deems appropriate and in the best interests of the Company, although it did not do so in 2021. Since 2016, Ryerson management, at the Compensation Committee’s request, has engaged Compensation Advisory Partners, (“CAP”), an independent executive compensation consultant, to assist in planning for the Company’s executive compensation program.
Compensation Committee Interlocks and Insider Participation
Mr. Kotzubei, Mr. Calhoun and Ms. Sigler served on our Compensation Committee during all of the last completed fiscal year. None of our executive officers serves as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board or our Compensation Committee. None of the members of the Compensation Committee is now an employee of the Company. Prior to the IPO, Ms. Sigler served as the Company’s Vice President. She resigned her position as an officer in August 2014 in connection with the IPO and has not served as an officer of the Company since that time.
Compensation Committee Report1
The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis section of this Proxy Statement, set forth below. Based on such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and be incorporated by reference into the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021.
Respectfully submitted by the Compensation Committee:
Jacob Kotzubei, Chair
Kirk K. Calhoun
Mary Ann Sigler
1 | The information contained in this report shall not be deemed to be “soliciting material” or to be “filed” with the Commission, nor shall such information or report be incorporated by reference into any future filing by us under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that we specifically incorporate it by reference in such filing. |
2022 Proxy Statement 19 |
Our Board has adopted a compensation program for our directors. Under the program, only directors who have been determined by the Board to be independent are eligible to receive compensation for their service as Board members. The program provides for an annual cash retainer, additional annual cash retainers for committee chairs and fees for meeting attendance, as follows:
Annual retainer |
| $ | 165,000 |
|
Committee chair retainers |
|
|
|
|
Audit Committee chair |
| $ | 15,000 |
|
Compensation Committee chair |
| $ | 10,000 |
|
Nominating and Corporate Governance Committee chair |
| $ | 10,000 |
|
Meeting Attendance Fees |
|
|
|
|
Each Board meeting |
| $ | 2,000 |
|
Each committee meeting |
| $ | 1,500 |
|
The following table presents information for compensation earned by our independent directors for their service as Board members during 2021.
Director Compensation Table
Name | Fees Earned or Paid in Cash(1) | Total | ||||||||
Kirk K. Calhoun(2) |
| $ | 200,500 |
|
|
| $ | 200,500 |
|
|
Court D. Carruthers(3) |
| $ | 181,000 |
|
|
| $ | 181,000 |
|
|
Stephen P. Larson(3) |
| $ | 181,000 |
|
|
| $ | 181,000 |
|
|
(1) | Consists of the annual retainer, Audit Committee chair retainer and meeting attendance fees. |
(2) | Consists of the annual retainer and meeting attendance fees. |
(3) | Consists of the annual retainer and meeting attendance fees. |
We reimburse each member of our Board for out-of-pocket expenses incurred by them in connection with attending meetings of the Board and its committees. Cash compensation and reimbursements are paid in arrears on a quarterly basis. There is currently no formal policy in place relating to the granting of equity awards to our directors.
Our executive officers are elected by the Board of Directors and hold office until a successor is chosen or qualified or until their earlier resignation or removal. The following lists our executive officers and gives a brief description of their business experience as of February 28, 2021, other than Mr. Lehner’s, whose biography can be found on page 11:
James J. Claussen, 49, has been the Company’s Executive Vice President & Chief Financial Officer (CFO) since January 2021. From July 2018 until that time, he had served as the president of Central Steel & Wire Company, LLC (CS&W), a subsidiary of Ryerson. Previously, he had served as the CFO of the Company's North-West Region and general manager of corporate development, and held several various leadership positions within the Company. Mr. Claussen has a bachelor's degree in accounting from Minnesota State University, Mankato, and an MBA from the University of Minnesota Carlson School of Management.
Molly D. Kannan, 40, has served as Chief Accounting Officer and Corporate Controller of the Company since January 2020. Ms. Kannan also served as the Company’s Interim Principal Financial Officer from January 2020 until January 2021. Previously, she served as our Corporate Controller since 2015, and held several various leadership positions within the Company. Ms. Kannan earned both a bachelor’s degree and a master’s degree in accounting from the University of Illinois at Urbana-Champaign.
20 RYERSON HOLDING CORPORATION |
Michael J. Burbach, 61, has been our President, North-West Region since October 2013 and Chief Operating Officer of the Company since April 2021. Prior to his service as President, North-West Region, he had served the Company as its President, Midwest Region since 2007. Mr. Burbach began his metals career as an inside sales representative at Vincent Metals in 1984 and has held procurement, sales and product management roles in the metals industry as well as roles in operations and senior management. Mr. Burbach received his Bachelor of Science degree from the University of Wisconsin-La Crosse.
John E. Orth, 55, has been our Executive Vice President-Operations since January 2019. Prior to that, Mr. Orth served as Senior Vice President – Operations of the Company since January 2018. Prior to joining the Corporation, since December 2011, Mr. Orth had served in various capacities for Morgan Advanced Materials, a global materials engineering company, including as Global Managing Director (Advanced Ceramics and Metals) from March 2016 to August 2017, and as a Vice President from February 2013 to March 2016. Mr. Orth earned his bachelor’s degree in electrical engineering from Vanderbilt University, and his master’s degree in materials science and engineering and doctorate’s degree in materials science and engineering from the University of Texas at Austin.
Mark S. Silver, 51, has served as our Executive Vice President, General Counsel & Chief Human Resources Officer since February 2020. Previously, he served as our Executive Vice President, General Counsel & Secretary from February 2016 to January 2020, and as Vice President & Managing Counsel from January 2013 until February 2016. Prior to his time at the Company, from 2006 until 2012, Mr. Silver served as Vice President and Assistant General Counsel of Sara Lee Corporation, a consumer goods company. Mr. Silver earned a bachelor’s degree in political science from the University of Illinois and a Juris Doctor from Harvard University.
Srini Sundarrajan, 50, has served as our Chief Information Officer since February 2019. Prior to joining the Company, Mr. Sundarrajan was Chief Information Officer for BlueLine Rental, one of the ten largest equipment rental companies in North America. Prior to joining BlueLine in 2014 as Director of Business Applications, Mr. Sundarrajan served in executive positions at IBM and RSC Equipment Rental, where he managed outsourcing contracts and led the development of rental applications. Mr. Sundarrajan earned a bachelor’s degree in computer science from Madurai Kamaraj University and a master’s in computer applications from Bharathiar University.
2022 Proxy Statement 21 |
Compensation Discussion and Analysis
This section explains our executive compensation philosophy, objectives and design; our compensation-setting process; our executive compensation program components; and the decisions made in 2021 with respect to the compensation of each of our named executive officers. The Company’s named executive officers for 2021 are:
Ο | Edward J. Lehner, President & Chief Executive Officer (“CEO”); |
Ο | James J. Claussen, Executive Vice President & Chief Financial Officer |
Ο |
Molly D. Kannan, |
Ο | Michael J. Burbach, |
| Ο | Mark S. Silver, |
Ο | John E. Orth, Executive Vice President, |
(1) | Effective as of January 11, 2021, the Board appointed Mr. Claussen as EVP & |
(2) | Prior to |
(3) | Effective as of April 2, 2021, the Board of Directors of the Company
Executive Compensation Philosophy The Company’s compensation decisions are based on the goals of recruiting, retaining and motivating individuals who could help us meet and exceed our financial and operational goals, for the purpose of providing meaningful returns to our stockholders. Objectives. Ryerson’s executive compensation program is designed to:
Principles. Ryerson seeks to promote a high-performance culture and create a compensation program that recognizes and rewards superior individual and Company performance. The following key principles are applied by the Board and our Compensation Committee when determining the compensation approach for the Company’s executives:
Consideration of Results of Advisory Vote on Executive Compensation In accordance with the advisory vote on the frequency of the stockholder advisory vote on executive compensation submitted to stockholders at the Company’s annual meeting of stockholders held in 2021, the Company will hold a stockholder advisory vote on executive compensation every three years. The most recent executive compensation advisory vote was held at the Company’s 2021 annual meeting of stockholders. At that time, our stockholders approved, by more than 99% of the shares voted, the compensation of our named executive officers as disclosed in the proxy statement for that meeting. This level of support was a factor in the Compensation Committee’s continued application of the same principles when making compensation decisions for our named executive officers for 2022. We expect that our next executive compensation advisory vote will be held at our annual meeting of stockholders in 2024.
The Board established the Compensation Committee to oversee various compensation-related matters, including executive compensation. Since that time, the Compensation Committee has been responsible for executive compensation matters as further described above under “Compensation Committee,” beginning on page 18, and has the authority to make decisions regarding the named executive officers’ compensation. In determining the levels and mix of compensation, our Compensation Committee has not generally relied on formulaic guidelines but rather has sought to maintain a flexible compensation program that allows it to adapt components and levels of compensation to motivate and reward individual executives within the context of our desire to maximize stockholder value. Subjective factors considered in compensation determinations included an executive’s tenure with the Company, skills and capabilities, contributions as a member of the executive management team, contributions to our overall performance, and whether the total compensation potential and structure were sufficient to ensure the retention of an executive when considering the compensation potential that may be available elsewhere. Use of Peer Groups for Compensation Matters Ryerson management, at the Compensation Committee’s request, has annually engaged an independent executive compensation consultant, currently Compensation Advisory Partners (“CAP”), to assist in planning for the Company’s executive compensation program. As an outside advisor, CAP has assisted in evaluating executive compensation programs, providing general executive compensation consulting support including a review of Ryerson’s compensation philosophy and compensation for Ryerson’s named executive officers. Specifically, CAP has completed competitive market positioning reviews of Ryerson’s named executive officers, based upon an assessment of relevant total compensation comparative data obtained from surveys and publicly reported proxy statements. The comparative reviews assessed the named executive officers’ base salaries, target annual bonuses (as a percentage of salary), total cash compensation and total direct compensation against the compensation paid to comparable positions reported in the surveys and comparable executives of the companies listed below, as reported by those companies. These companies (our “Peer Group”) generally are competitors of Ryerson or conduct business in industries similar to Ryerson’s and, as a group, have annual sales comparable to Ryerson’s. Overall, Ryerson’s executive salaries and target annual cash compensations are at or below market median relative to our Peer Group.
At the Compensation Committee’s request, CAP regularly attends Compensation Committee meetings. CAP presented its report on the competitiveness of the executive compensation program for 2021 to the Compensation Committee in December 2021. The Compensation Committee and the Board considered the report and Peer Group information in making some of its 2021 compensation decisions, as further described below. The compensation provided to our named executive officers in 2021 consisted of the same elements generally available to our non-executive employees, including base salary, annual bonuses, and retirement and other benefits, each of which is described in more detail below. In addition, each of our named executive officers has the opportunity to participate in an equity-based long-term incentive program. Currently, we do not view perquisites or other personal benefits as a significant component of our executive compensation program. Accordingly, we do not provide perquisites or other personal benefits to our executive officers, including the named executive officers, and do not have a formal perquisites policy, but may provide perquisites and other personal benefits in situations where we believe it is appropriate to assist an individual in the performance of his or her duties, to make our executive officers more efficient and effective, and for recruitment and retention purposes. Our named executive officers may also receive compensation in connection with the termination of their employment in some circumstances, as further described below under “Narrative Relating to Summary Compensation Table and Grants of Plan-Based Awards,” on page 37, and under “Potential Payments Upon Termination or Change in Control,” on page 41.
Relationship Among the Different Components of Compensation In order to ensure that our named executive officers are held most accountable for our performance and changes in stockholder value, management and the committee generally allocate total compensation such that the portion of compensation attributable to fixed elements, such as salary and benefits, decreases with increasingly higher levels of responsibility, and the portion attributable to variable, performance-based elements increases with increasingly higher levels of responsibility. In setting the allocation between the fixed and variable elements, we seek to ensure that sufficient fixed income is provided, while not incentivizing overly risky business strategies. The value of the named executive officers’ 2021 base salaries, target annual bonus opportunities for 2021 and long-term incentive plan awards granted in 2021, as a percentage of those three components, are set forth below. Each component is discussed in more detail in the sections below.
The base salary payable to each named executive officer was intended to provide a fixed component of compensation reflecting the executive’s skill set, experience, role and responsibilities, as well as to recruit well-qualified executives. Salary is paid to ensure that we are able to attract and retain the talent necessary to lead our Company and to ensure that sufficient fixed income is provided even when variable compensation programs pay out below target (or not at all). The named executive officers’ initial base salaries are generally determined in connection with the negotiation of their employment terms upon their hiring or promotion. The salary levels are then reviewed annually in connection with the Company’s salary review for all management employees. Each year, the head of the Company’s human resources department (currently our Executive Vice President, General Counsel & Chief Human Resources Officer) recommends to the CEO a salary adjustment for each officer reporting to the CEO (other than with respect to the Executive Vice President, General Counsel & Chief Human Resources Officer, which the CEO determines). This recommendation is based on a review of (i) competitive market factors (including the reports produced by CAP and the compensation practices of our compensation Peer Group and the positioning of each executive officer's compensation in a ranking of Peer Group compensation levels, taking into account each individual executive officer's skills, experience, and qualifications relative to other similarly situated executives at the companies in our Peer Group), (ii) Company budget considerations, and (iii) retention considerations and the officer’s performance during the prior year, including the CEO’s performance against the CEO’s personal goals determined at the beginning of the prior year. After reviewing this recommendation, the CEO may make modifications based on the CEO’s own assessment of individual performance and then prepares salary recommendations for the officers reporting to the CEO. The CEO then makes recommendations to the Compensation Committee for each officer (other than for the CEO); the Executive Vice President, General Counsel & Chief Human Resources Officer makes a recommendation directly to the Compensation Committee regarding the CEO’s salary, which recommendation is determined in the same manner as the recommendations to the CEO regarding the other officers’ salaries. The Compensation Committee members then review the salary recommendations and, after any adjustments, determine the officers’ base salaries on behalf of the Company, except for the CEO’s base salary, which the Compensation Committee recommends to the Board for approval. In determining base salaries for our named executive officers for any particular year, the Committee generally considers, among other factors, competitive market practice, individual performance for the prior year and the mix of fixed to variable compensation.
2021 Base Salaries In February 2021, in accordance with the process described above, the Compensation Committee considered the recommendations from Mr. Silver and Mr. Lehner, the comparable compensation reported in surveys, the Peer Group information and other factors, including market competitiveness, and approved new base salaries of the named executive officers (except for the CEO’s base salary, which was recommended to and approved by the Board).
The Company has historically maintained an annual incentive plan (“AIP”), pursuant to which its key managers (including our named executive officers) are eligible to receive performance-based cash bonuses tied to the Company’s achievement of specified financial performance targets for each year. Each year the Compensation Committee or the Board establishes objective financial performance criteria that must be met by the Company in order for bonuses to be paid (usually establishing threshold, target and maximum payout levels for each type of performance measure), and other terms and conditions of awards under the AIP. It also approves any changes to the bonus targets for the named executive officers (other than the CEO’s, which is recommend to and approved by the Board), which are expressed as a percentage of annual salary base rates of the applicable AIP plan year. Under the AIP, no cash AIP bonuses are payable unless we achieve the performance thresholds set for the performance period. In general, a participant must be employed by the Company or its subsidiaries through the end of the AIP plan year to receive an AIP bonus payment, although some exceptions exist for circumstances such as retirement, death or position elimination. Additional information regarding AIP bonus payments in these circumstances is included below under “Potential Payments Upon Termination or Change in Control,” below on page 41. The named executive officers’ target AIP bonus percentages are generally determined in connection with the negotiation of their employment terms upon their hiring or promotion. The target bonus percentages are then reviewed annually by the head of the Company’s human resources department (currently our Executive Vice President, General Counsel & Chief Human Resources Officer) who makes a recommendation to the CEO regarding any percentage adjustments for each officer reporting to the CEO (other than himself, which the CEO determines). This recommendation is based on a review of the same factors he uses in determining base salary adjustments. After reviewing this recommendation, the CEO may make modifications based on his own assessment, and then prepares recommendations for the officers reporting to him. The CEO then makes his recommendations to the Compensation Committee for each officer (other than himself); the Executive Vice President, General Counsel & Chief Human Resources Officer makes a recommendation directly to the Compensation Committee regarding the CEO’s percentage, which recommendation is determined in the same manner as his recommendations to the CEO regarding the other officers’ bonus target percentages. The Compensation Committee members then review the target bonus percentage recommendations and, after any adjustments, determine each officer’s target bonus percentage on behalf of the Company, except for the CEO’s bonus targets, which the Compensation Committee recommends to the Board for approval. In determining target bonus percentages for our named executive officers for any particular year, the Committee generally considers the same factors it uses in determining base salary rate adjustments. The Compensation Committee may make the target bonus percentage change effective for the full year or make it effective on some date later in the plan year. If a participant’s target bonus percentage is changed effective during a plan year, then the effective target bonus percentage for the plan year is a weighted average of the two percentages, based on the time during the year that each of the two percentages was in effect unless determined otherwise by the Compensation Committee.
In February 2021, the Company’s 2021 annual incentive plan (the “2021 AIP”) was approved by our Compensation Committee, and the 2021 AIP bonus targets for our named executive officers were expressed as a percentage of their annual base salary rates in effect on November 30, 2021. Each such target was determined in accordance with the process described above. In February 2021, the Compensation Committee considered the recommendations of Messrs. Lehner and Silver, the comparable compensation reported in surveys, the Peer Group information and other factors, including the factors it considered in making base salary rate adjustments, and it set the target bonus percentages of the named executive officers as set forth in the below table for the fiscal year 2021 (except for the CEO’s target, which was recommended to and approved by the Board). The target AIP bonus levels were set to reflect the relative responsibility for our performance and to allocate appropriately the total cash opportunity between base salary and incentive-based compensation.
For the 2021 AIP, it was determined that a combination of earnings before interest, taxes, depreciation, amortization, and other adjustments (“Adj. EBITDA, excl. LIFO”), and “economic value added” (“EVA”) should be used as the performance measures for determining the cash AIP bonus payable to our named executive officers. Adj. EBITDA, excl. LIFO and EVA were chosen as the appropriate performance measures to motivate our key executives, including the named executive officers, to both maximize earnings and increase our enterprise value. These performance measures’ thresholds and targets are set such that it exceeds fixed cash commitments. Adj. EBITDA, excl. LIFO is calculated as our net income excluding interest and other expense on debt, provision for income taxes, depreciation, amortization, reorganization, net last-in first-out inventory expenses or income, asset impairment expenses, and other charges (as reported in the Company’s annual audited financial statements included in the Company’s Form 10-K and other SEC filings). EVA is the amount by which Adj. EBITDA, excl. LIFO exceeded a carrying cost of capital applied to certain of our assets (“Cost of Capital”). Cost of Capital is equal to our net operating assets (accounts receivable plus average cost inventory plus property, plant & equipment, plus prepaid expenses and other assets, minus accounts payable, minus salaries & wages payable, and minus other current liabilities) (as reported in the Company’s annual audited financial statements included in the Company’s Form 10-K and other SEC filings) multiplied by the “cost of capital rate” of 15%. In summary, EVA is calculated as Adj. EBITDA, excl. LIFO minus the Cost of Capital. For our named executive officers, 50% of their bonus opportunity for 2021 was based on Company (“corporate”) Adj. EBITDA, excl. LIFO and the remaining 50% was based on corporate EVA for 2021. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure is included in Appendix A to this proxy statement.
Actual Payouts under the 2021 AIP In 2021, the Company’s financial performance exceeded the maximum payout level under the 2021 AIP for corporate performance and resulted in a 200% payout under the 2021 AIP for all named executive officers. Information on the achievement of the targets applicable to the named executive officers for 2021 AIP purposes and actual 2021 AIP payout are shown in the tables below.
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