UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 14A PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934 (Amendment No. ) | ||
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| 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 under §240.14a-12 | ||||
Gibraltar Industries, Inc. (Name of Registrant as Specified In Its Charter) | ||
| ___________________________________________________ | ||
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| Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11 | ||||
 Notice of 2023 Annual Meeting of Stockholders and Proxy Statement | ||
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April 3, 2023 Dear Fellow Stockholders of Gibraltar: We are pleased to invite you to the 2023 Annual Meeting of Stockholders of Gibraltar Industries, Inc. to be held on Wednesday, May 3, 2023 at 11:00 A.M., Eastern Time, in a virtual format at www.virtualshareholdermeeting.com/ROCK2023. The Annual Meeting is critical to our corporate governance process and to affirming the direction of our Company. The accompanying Proxy Statement provides you with important information about our Board of Directors and executive officers. Additionally, the Proxy Statement informs you of steps we are taking to fulfill our responsibilities to you as a stockholder. The accompanying Proxy Statement provides you with information relating to the proposals that require your vote. If you hold shares through a brokerage firm, please note that your broker cannot vote on most of the proposals to be acted on at the Annual Meeting without your instruction. Your vote is very important to us and we encourage you to vote promptly using one of the voting methods described in the accompanying Proxy Statement. Our Board of Directors recommends that stockholders vote FOR all proposals. On behalf of our management team and our Board of Directors, we want to thank you for your continued support and confidence in Gibraltar Industries, Inc. Sincerely, | ||
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William T. Bosway Chairman of the Board, President and Chief Executive Officer | Atlee Valentine Pope Lead Independent Director | ||||||||||||||||
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3556 Lake Shore Road PO Box 2028 Buffalo, New York 14219-0228 NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 3, 2023 | ||
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Gibraltar Industries, Inc., a Delaware corporation (the “Company”), will be held on Wednesday, May 3, 2023, at 11:00 A.M., Eastern Time (the “2023 Annual Meeting”). The 2023 Annual Meeting will be held in virtual meeting format. You can attend the 2023 Annual Meeting online, vote your shares electronically and submit your questions during the meeting, by visiting www.virtualshareholdermeeting.com/ROCK2023. You will need to have the 16-digit control number included on your proxy card, or in the instructions that accompanied your proxy materials by the method you consented or elected to receive for delivery. The 2023 Annual Meeting will be held for the following purposes: 1.Election of eight Director nominees named in the accompanying proxy statement, each to hold office for a one-year term until the 2024 Annual Meeting or until a successor has been duly elected and qualified, or until such director's earlier resignation, retirement or other termination of service. 2.Advisory vote to determine stockholder preference on whether future Say-on-Pay votes should occur every one, two, or three years (the "Say-When-on-Pay" vote). 3.Advisory approval of the Company's executive compensation (the "Say-on-Pay" vote). 4.Approval of the Gibraltar Industries, Inc. Amended and Restated 2018 Equity Incentive Plan to increase the number of shares of common stock available for issuance as equity awards thereunder by 550,000 and to make other specified revisions. 5.Approval of an amendment to the Company's Amended and Restated Certification of Incorporation to add a provision designating the state and federal courts of the State of Delaware as the exclusive forums in which certain claims may be brought against the Company. 6.Ratification of the appointment of Ernst & Young LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2023. 7.Transaction of such other business as may properly come before the meeting or any adjournment or postponement thereof. The Board of Directors has fixed the close of business on March 17, 2023, as the record date for the determination of stockholders entitled to receive notice of and to vote at the 2023 Annual Meeting or any adjournment or postponement thereof. Even if you plan to participate in the 2023 Annual Meeting, please promptly vote in advance of the meeting by following the instructions in the proxy card or voting instruction form. Voting in advance of the 2023 Annual Meeting does not deprive you of your right to virtually attend the 2023 Annual Meeting and to vote your shares electronically during the meeting. | ||
| By Order of the Board of Directors | |||||
 | |||||
Katherine E. Bolanowski General Counsel, Vice President and Secretary | |||||
Buffalo, New York | |||||
| April 3, 2023 | |||||
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held May 3, 2023 The Notice of Annual Meeting of Stockholders, the accompanying Proxy Statement and the fiscal year 2022 Annual Report are available at www.proxyvote.com. | |||||
| TABLE OF CONTENTS | |||||
A-1 | APPENDIX A - NON-GAAP MEASUREMENTS | ||||
B-1 | APPENDIX B - AMENDED AND RESTATED 2018 EQUITY INCENTIVE PLAN | ||||
C-1 | APPENDIX C - AMENDED AND RESTATED CERTIFICATE OF INCORPORATION | ||||
PROXY SUMMARY | ||
This proxy summary highlights information contained elsewhere in this Proxy Statement for the 2023 Annual Meeting of Stockholders (the "2023 Annual Meeting") of Gibraltar Industries, Inc. (the "Company", "Gibraltar", "we", "us" and "our"). You should read the entire proxy statement before voting. For more complete information regarding the performance of Gibraltar for the fiscal year ended December 31, 2022 ("fiscal year 2022"), you should review Gibraltar's annual report on Form 10-K for fiscal year 2022. We intend to mail to our stockholders of record the Notice of Annual Meeting of Stockholders and this proxy statement on or about April 3, 2023. | ||
| ABOUT THE 2023 ANNUAL MEETING | |||||||||||||||||||||||
| WHEN | WEBCAST | RECORD DATE | |||||||||||||||||||||
| Wednesday, May 3, 2023 11:00 a.m. (Eastern Time) | www.virtualshareholdermeeting.com/ROCK2023 | March 17, 2023 | |||||||||||||||||||||
| YOUR VOTE IS IMPORTANT | ||||||||
| Whether or not you plan to participate in the Annual Meeting, we urge you to carefully review the applicable proxy materials and follow the instructions below to cast your vote promptly on all of the proposals. | ||||||||
| The following proposals will be addressed at the Annual Meeting. | ||||||||||||||||||||||||||
| Proposal | Board Recommendation | Reasons for Board Recommendation | More Information | |||||||||||||||||||||||
| 1 | Election of Directors |  | FOR each nominee | The Board of Directors and Nominating, Governance and Corporate Social Responsibility Committee believe that the eight Board candidates possess the skills, experience, and diversity to effectively monitor performance, provide oversight, and advise management on the Company’s long-term strategy. | Page 6 | |||||||||||||||||||||
| 2 | Advisory vote to determine stockholder preference on whether future Say-on-Pay votes should occur every one, two, or three years ("Say-When-on-Pay") | | FOR every one year | The Board recommends having a Say-on-Pay vote each year so that stockholders have the opportunity to regularly express their views regarding the Company's compensation program. | Page 26 | |||||||||||||||||||||
| 3 | Advisory approval of the Company’s executive compensation (Say-on-Pay) | | FOR | The Board of Directors believes that the Company’s executive compensation programs demonstrate the continuing focus by the Company on a pay for performance philosophy. | Page 27 | |||||||||||||||||||||
| 4 | Approval of the Gibraltar Industries, Inc. Amended and Restated 2018 Equity Incentive Plan | | FOR | The Board of Directors and the Compensation and Human Capital Committee believe that the amended and restated equity incentive plan will enable the Company to provide competitive equity compensation to attract and retain employees. | Page 58 | |||||||||||||||||||||
2023 PROXY STATEMENT 1
| PROXY SUMMARY | ||
| Proposal | Board Recommendation | Reasons for Board Recommendation | More Information | |||||||||||||||||||||||
| 5 | Approval of an amendment to the Company's Amended and Restated Certificate of Incorporation to add a provision designating the state and federal courts of the State of Delaware as the exclusive forums in which certain claims may be brought against the Company | | FOR | The Board of Directors believes that the Company and its stockholders will benefit from amending the Company’s Certificate of Incorporation to require certain corporate claims to be brought in Delaware, which provides a streamlined, organized and efficient forum to resolve such disputes. | Page 67 | |||||||||||||||||||||
| 6 | Ratification of Ernst & Young LLP as our Independent Registered Public Accounting Firm | | FOR | Based on the Audit and Risk Committee’s assessment of Ernst & Young’s qualifications and performance, the Board of Directors and the Audit and Risk Committee believe that its retention for fiscal year 2023 is in the best interests of the Company. | Page 69 | |||||||||||||||||||||
| The following sets forth the methods by which you may vote for purposes of the Annual Meeting. | |||||
| BY INTERNET | Before The Meeting - Go to www.proxyvote.com. Use the internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 p.m. Eastern Time on May 2, 2023 for shares held directly and by 11:59 p.m. Eastern Time on April 30, 2023 for shares held in a Plan. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. During the Meeting - Go to www.virtualshareholdermeeting.com/ROCK2023. You may attend the meeting via the internet and vote during the meeting. Have your 16-digit control number in hand and follow the instructions. | ||||
| BY TELEPHONE | Call the telephone number listed on your proxy card or voting instruction form. | ||||
| BY MAIL | Sign, date and return your proxy card or voting instruction form in the enclosed envelope. | ||||
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| PROXY SUMMARY | ||
About Gibraltar | ||
Gibraltar is a leading manufacturer and provider of products and services for the renewable energy, residential, agtech, and infrastructure markets. Gibraltar's mission is to make life better for people and the planet, fueled by advancing the disciplines of engineering, science, and technology. Gibraltar is innovating to reshape critical markets in sustainable power, comfortable and efficient living, and productive growing throughout North America. | ||
Fiscal Year 2022 Company Performance | ||
Highlights of Gibraltar's 2022 performance include: | ||
| NET SALES | GAAP EPS | ADJUSTED EPS | ||||||||||||||||||
| $1.4B | $2.56 | $3.40 | ||||||||||||||||||
| increased 4% from $1.3B in 2021 | increased 14% from $2.25 in 2021 | increased 22% from $2.78 in 2021 | ||||||||||||||||||
In 2022, we focused on our key initiatives, improved profitability and margin compared to 2021, and: •generated net sales of $1.4 billion, up 4% compared to the prior year; •increased GAAP and adjusted net income from continuing operations by 9% and 15%, respectively; •increased GAAP and adjusted earnings per share from continuing operations by 14% and 19%, respectively; •acquired a business to expand our Residential Products segment; and •made the decision to exit our processing equipment business in our Agtech segment. | ||
| Board Diversity Matrix (as of April 3, 2023) | ||||||||||||||||||||||||||
| Total Number of Directors | 8 | |||||||||||||||||||||||||
| Female | Male | Non-Binary | Did Not Disclose Gender | |||||||||||||||||||||||
| Part I: Gender Identity | ||||||||||||||||||||||||||
| Directors | 3 | 5 | 0 | 0 | ||||||||||||||||||||||
| Part II: Demographic Background | ||||||||||||||||||||||||||
| African American or Black | 1 | 0 | 0 | 0 | ||||||||||||||||||||||
| Alaskan Native or Native American | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
| Asian | 0 | 1 | 0 | 0 | ||||||||||||||||||||||
| Hispanic or Latinx | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
| Native Hawaiian or Pacific Islander | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
| White | 2 | 4 | 0 | 0 | ||||||||||||||||||||||
| Two or More Races or Ethnicities | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
| LGBTQ+ | 0 | |||||||||||||||||||||||||
| Did Not Disclose Demographic Background | 0 | |||||||||||||||||||||||||
2023 PROXY STATEMENT 3
| PROXY SUMMARY | ||
Executive Compensation Highlights | ||||||||
The target annual compensation in fiscal year 2022 for William T. Bosway, the Company's President and Chief Executive Officer, consisted of base salary, target annual management incentive compensation, including target matching RSUs under the Company's 2018 Management Stock Purchase Plan, a target performance stock units (PSUs), time-vested restricted stock units (RSUs), and other compensation of 401(k) match, health reimbursement account contributions, personal use of Company auto and tax planning. Mr. Bosway's target pay mix for fiscal year 2022 is set forth in the chart. The actual earnings under the performance-based components for Mr. Bosway and our other named executive officers for fiscal year 2022 were as follows: |  | |||||||
Annual Management Incentive Compensation Plan (MICP) The named executive officers received less than target under the annual MICP as the Company did not achieve the targeted levels for 2022 of the annual MICP metrics (net sales, adjusted EPS, and days working capital). The actual payout percentage was 69% for 2022. There were no adjustments made to the performance targets approved by the Board in early 2022. | ||||||||
| Named Executive Officer | Potential Payout At Target | Actual | ||||||||||||
| Payout Percentage | Payout At Actual | |||||||||||||
| William T. Bosway | $ | 990,000 | 69% | $ | 683,100 | |||||||||
| Timothy F. Murphy | $ | 275,586 | 69% | $ | 190,154 | |||||||||
| Katherine E. Bolanowski | $ | 129,505 | 69% | $ | 89,358 | |||||||||
| Jeffrey J. Watorek | $ | 62,500 | 69% | $ | 43,125 | |||||||||
| Patrick M. Burns (1) | $ | 275,586 | 69% | $ | 190,154 | |||||||||
| Elizabeth R. Jensen (2) | $ | 132,860 | 69% | $ | 91,673 | |||||||||
2022 PSUs The named executive officers received less than target for 2022 as the Company did not achieve the targeted level for return on invested capital for the 2022 performance period. The actual 2022 PSUs achievement was 60.5% of target for 2022. There were no adjustments made to the performance targets approved by the Board in early 2022. | ||||||||
| Named Executive Officer | Target Compensation from PSU Awards | Actual | ||||||||||||
| Percentage of PSUs Earned | Earned Compensation from PSU Awards | |||||||||||||
| William T. Bosway | $ | 1,856,250 | 60.5% | $ | 1,123,018 | |||||||||
| Timothy F. Murphy | $ | 459,310 | 60.5% | $ | 277,864 | |||||||||
| Katherine E. Bolanowski | $ | 148,005 | 60.5% | $ | 89,535 | |||||||||
| Jeffrey J. Watorek | $ | 150,000 | 60.5% | $ | 90,757 | |||||||||
| Patrick M. Burns (1) | $ | 459,310 | 60.5% | $ | 277,864 | |||||||||
| Elizabeth R. Jensen (2) | $ | 265,720 | 60.5% | $ | 160,740 | |||||||||
(1) Burns served as Chief Operating Officer through his last date of employment on December 30, 2022 and will receive his MICP payout at actual and earned 2022 PSUs. (2) Jensen served as Vice President and Chief Human Resource Officer through her last date of employment on January 13, 2023, and will receive her MICP payout at actual, but will not receive any 2022 PSUs. | ||||||||
4
| PROXY SUMMARY | ||
| Compensation Governance Focused on Pay-for-Performance | ||||||||||||||
| What We Do | What We Don’t Do | |||||||||||||
| Deliver a significant portion of executive compensation in the form of at-risk, performance-based compensation | X | Have single-trigger change-in-control agreements | |||||||||||
| Set performance goals for stock-based incentives on ROIC based in part on consultation with significant stockholders | X | Provide double-trigger change-in-control cash benefits greater than 275% of cash compensation | |||||||||||
| Limit the maximum payout that can be received in our annual cash incentive plan to 200% of target | X | Maintain a supplemental executive retirement plan | |||||||||||
| Reward certain executives with performance-based compensation awards linked to relative total stockholder return | X | Allow our directors and employees to enter into hedging and pledging transactions with Gibraltar stock | |||||||||||
| Require our directors and executive officers to satisfy stock ownership guidelines | X | Provide excise tax gross-ups upon a change in control | |||||||||||
| Engage in a rigorous target-setting process and use multiple performance metrics for the annual cash incentive plan | X | Provide tax gross-ups on executive benefits and perquisites | |||||||||||
| Maintain a Clawback Policy that applies to our named executive officers | X | Grant discounted stock options or reload or re-price stock options without stockholder approval | |||||||||||
| Reasonable use of executive perquisites | |||||||||||||
| Focus on mitigating undue risk in compensation programs | |||||||||||||
Governance Highlights | ||
| Annual Election of All Directors | Yes | Annual Board and Committee Self-Evaluations | Yes | |||||||||||
| Average Age of Directors Standing for Election (Years) | 61 | Risk Oversight by Full Board and Committees | Yes | |||||||||||
| Average Director Tenure (Years) | 4 | Stock Ownership Guidelines for Non-Employee Directors and Executive Officers | Yes | |||||||||||
| Percentage of Women on Board | 37.5% | Anti-Hedging and Anti-Pledging Policies | Yes | |||||||||||
| Separate Chair and CEO | No | Clawback Policy | Yes | |||||||||||
| Independent Lead Director | Yes | Annual Advisory Approval of Executive Compensation | Yes | |||||||||||
| Classified Board | No | Poison Pill | No | |||||||||||
2023 PROXY STATEMENT 5
PROPOSAL 1 - ELECTION OF DIRECTORS | ||
The Certificate of Incorporation of the Company provides that the Board of Directors shall consist of not less than three nor more than fifteen directors. The number of directors may be changed at any time by resolution of the Board of Directors. Our Certificate of Incorporation also requires annual election of directors. Currently, our Board has eight directors. At the Annual Meeting, eight directors shall be elected to hold office for a one-year term expiring in until the 2024 Annual Meeting or until a successor has been duly elected and qualified, or until such director's earlier resignation, retirement or other termination of service. Following the recommendation by the Nominating, Governance and Corporate Social Responsibility Committee, the Board of Directors has nominated Mark Barberio, William Bosway, Craig Hindman, Gwendolyn Mizell, Linda Myers, James Nish, Atlee Valentine Pope, and Manish Shah for re-election. The Board of Directors has determined that all nominees, other than Mr. Bosway, our Chairman of the Board, President and Chief Executive Officer, are independent directors under the applicable independence standards of the Nasdaq Stock Market ("Nasdaq") and the Securities and Exchange Commission ("SEC"). Unless instructions to the contrary are received, the persons named as proxies in the attached proxy card intend to vote the shares represented by proxies FOR the election of all nominees as directors, each of whom has consented to serve as a director if elected. If any nominee becomes unavailable for election for any reason, the Board may designate a substitute nominee and the persons named as proxies intend to vote the shares represented by the proxies solicited herewith for such other person or persons as the Board of Directors shall designate. Alternatively, the Board may reduce its size. The Board of Directors believes that directors should satisfy a number of qualifications, including demonstrated integrity, a record of personal accomplishment, and a commitment to participation in board activities. In recommending the nominees for re-election, the Company's Nominating, Governance and Corporate Social Responsibility Committee considers qualified candidates who will provide the Board of Directors with dedicated service, strong business-related skills and experience, and diversity, as such qualifications are described below under the caption "Director Nomination Process." The table below summarizes the key experience, qualifications, and attributes for each director nominee and highlights the balanced mix of experience, qualifications, and attributes of the Board as a whole. The Nominating, Governance and Corporate Social Responsibility Committee considered these qualifications in determining to recommend to the Board of Directors that the current directors be nominated for re-election. This high-level summary is not intended to be an exhaustive list of each director nominee's skills or contributions to the Board. No individual experience, qualification, or attribute was solely determinative in the Board's decision to re-elect any of the eight nominees. | ||
| Director Nominee | Director Since | Number of Other Public Boards | Backgrounds and Skills | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SL | G | C | HC | F | L | M | O | PM | D | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mark G. Barberio * | 2018 | Two | l | l | l | l | l | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| William T. Bosway | 2019 | None | l | l | l | l | l | l | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Craig A. Hindman * | 2014 | None | l | l | l | l | l | l | l | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gwendolyn G. Mizell * | 2021 | None | l | l | l | l | l | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Linda K. Myers * | 2020 | One | l | l | l | l | l | l | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| James B. Nish * | 2015 | One | l | l | l | l | l | l | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Atlee Valentine Pope * | 2020 | None | l | l | l | l | l | l | l | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Manish H. Shah * | 2021 | None | l | l | l | l | l | l | l | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
* Independent Director | |||||||||||||||||||||||
| SL | Senior Leadership | HC | Human Capital | M | Marketing | PM | Portfolio Management | ||||||||||||||||
| G | Governance | F | Finance | O | Operations | D | Digital | ||||||||||||||||
| C | Corporate Social Responsibility | L | Legal | ||||||||||||||||||||
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| PROPOSAL 1 - ELECTION OF DIRECTORS | ||
| Director Tenure | Age Distribution | Diversity | ||||||
 | ||||||||
 0-3 years (4 of 8 director nominees) 4-8 years (4 of 8 director nominees) | age 56-61 (5 of 8 director nominees) age 62-67 (2 of 8 director nominees) age 68-72 (1 of 8 director nominees) | Diverse (4 of 8 director nominees) Female (3 of 8 director nominees) Racially or ethnically diverse (2 of 8 director nominees) | ||||||
Nominees | ||
The following biographies set forth the business experience during at least the past five years of each director and a brief discussion of the specific experience, qualifications and other attributes that led to the conclusion that each director should continue to serve on the Board at this time. | ||
| MARK G. BARBERIO | |||||
 | Professional Experience: Mark Barberio has served as a Director of the Company since 2018. He brings to the Board more than 30 years of senior management and board experience across a variety of industries at both public and private companies. He is and has been principal of Markapital, LLC, a business and M&A consulting firm, since 2013. Prior to forming Markapital, he led Mark IV, LLC (now Dayco, LLC), a global diversified manufacturing company, where he served in a variety of positions, including as Co-CEO and CFO. Other Current Public Board Directorships: He has been an independent director of NYSE-listed Life Storage, Inc. since 2015 and in May 2018 was elected Non-Executive Chairman. He is a member of the Compensation and Human Capital Committee and Governance, Nominating and Corporate Social Responsibility Committee. In February 2020, Mr. Barberio was elected to the board of Endo International plc. and in June 2021 was elected Non-Executive Chairman. He is a member of the Audit and Finance Committee, Compensation and Human Capital Committee, Governance and Social Responsibility Committee, the Compliance Committee, and Chairman of the Strategic Planning Committee. He was a board member of Exide Technologies, a privately held global energy storage solution company from April 2015 through October 2020. He is also a member of the board of Trustees of Rochester Institute of Technology and Chairman of the Audit Committee. Director Qualifications: Mr. Barberio’s qualifications to serve on the Board include his extensive experience as a CEO and CFO in strategy development, finance, operational oversight, real estate, capital markets, acquisitions and investor relations. | ||||
Director Since: June 2018 Board Committees: •Audit and Risk •Capital Structure and Asset Management Age: 60 Background and Skills: •Senior Leadership •Governance •Finance •Operations •Portfolio Management | |||||
2023 PROXY STATEMENT 7
| PROPOSAL 1 - ELECTION OF DIRECTORS | ||
| WILLIAM T. BOSWAY | |||||
| Professional Experience: William Bosway has served as President, Chief Executive Officer and a Director of the Company since January 2019, and Chairman of the Board of Directors since January 2022. He joined the Company from Dover Corporation, a diversified global manufacturer, where he was President and Chief Executive Officer of the Refrigeration and Food Equipment Division from June 2016 to December 2018. Prior to joining Dover Corporation, he was employed by Emerson Electric Co., a global manufacturer of industrial, commercial and consumer products, where he held the position of Group Vice President, Solutions & Technology for Emerson Climate Technologies from May 2008 through June 2016. Director Qualifications: Mr. Bosway’s qualifications to serve as a member of the Board include his strong leadership skills and significant experience in driving organic and acquisition growth, his breadth of experience in a variety of global industrial markets, and his proficiency in manufacturing operations. | ||||
Chairman of the Board and Chief Executive Officer Director Since: January 2019 Age: 57 Background and Skills: •Senior Leadership •Corporate Social Responsibility •Human Capital •Marketing •Operations •Portfolio Management | |||||
| CRAIG A. HINDMAN | |||||
 | Professional Experience: Craig Hindman has served as a Director of the Company since 2014. He is a global executive with more than 35 years of leadership experience across multiple industry segments. Most recently, Mr. Hindman was Executive Vice President and Chief Executive Officer of the Industrial Packaging Group of businesses at ITW. In that role, he was responsible for 110 business units operating in 30 countries. He led the group through two acquisitions before leading the sale of the Industrial Packaging Group to The Carlyle Group in 2014. Prior to leading the Industrial Packaging Group, Mr. Hindman spent more than two decades in ITW’s Construction Products Group. Additionally, he serves as a director of a number of not-for-profit organizations and private companies, including Wilsonart International for which he serves as a member of the Compensation Committee. Director Qualifications: Mr. Hindman’s qualifications to serve on the Board include his experience as an executive with responsibility for the financial and operational performance of global industrial business units within a best-in-class, Fortune 200 company. Other qualifications include his experience in the integration of acquired businesses and business simplification over a period of more than 20 years as well as his significant experience in and familiarity with end markets served by the Company. | ||||
Director Since: October 2014 Board Committees: •Compensation and Human Capital (Chair) •Capital Structure and Asset Management Age: 68 Background and Skills: •Senior Leadership •Governance •Human Capital •Finance •Marketing •Operations •Portfolio Management | |||||
8
| PROPOSAL 1 - ELECTION OF DIRECTORS | ||
| GWENDOLYN G. MIZELL | |||||
 | Professional Experience: Gwendolyn Mizell has served as a Director of the Company since February 2021. She began her career with Ameren Corporation in 2015 as Director of Diversity and Inclusion and has been promoted through various levels of leadership in Corporate Social Responsibility, Sustainability, Electrification and Innovation. Today, Ms. Mizell is the Senior Vice President, Chief Sustainability, Diversity and Philanthropy Officer of Ameren and she is a member of the Ameren Executive Leadership Team. As the Senior Vice President, Chief Sustainability, Diversity and Philanthropy Officer, Ms. Mizell is responsible for developing and executing sustainability strategy across the company, aligning Diversity Equity and Inclusion and Corporate Philanthropy for maximum community, customer and social impact and regularly reports to the Ameren Board of Directors and its committees. She chairs the Sustainability Executive Steering Committee, a cross-functional team of company leaders, designed to ensure alignment between Sustainability and corporate strategy. Prior to joining Ameren, Ms. Mizell was President and Chief Executive Officer of GSM Development LLC, a business services firm supporting utilities across the US. Over her career, she has held positions of increasing responsibility with Westinghouse, Siemens, ABB, Calpine and KEMA Corporation. While at Westinghouse, she was responsible for air, water and acoustic compliance for power stations with modified environmental controls systems. Ms. Mizell was appointed to the St Louis County Workforce Investment Board, serves on the national board for the American Association of Blacks in Energy, the EEI Sustainability Committee, the Conference Board Sustainability Council and is outgoing Director of the Mathews-Dickey Boys and Girls Club of St Louis. Director Qualifications: Ms. Mizell’s qualifications to serve on the Board include her experience in strategy development, ESG, corporate social responsibility, diversity, equity and inclusion and power operations. | ||||
Director Since: February 2021 Board Committees: •Compensation and Human Capital •Nominating, Governance and Corporate Social Responsibility Age: 61 Background and Skills: •Senior Leadership •Corporate Social Responsibility •Human Capital •Marketing •Operations | |||||
2023 PROXY STATEMENT 9
| PROPOSAL 1 - ELECTION OF DIRECTORS | ||
| LINDA K. MYERS | |||||
 | Professional Experience: Linda Myers has served as a Director of the Company since February 2020. Ms. Myers retired in February 2022 from Kirkland & Ellis LLP (“Kirkland”), a law firm with a national and international presence, where she was employed since 1994. Ms. Myers was a member of Kirkland's Global Management Committee from 2010 to 2020 and has 3 decades of experience advising clients. As a senior partner and one of the original members of Kirkland's Debt Finance Practice Group, Ms. Myers’ focused on transactions for private equity groups, commercial lending institutions and major private and public companies. Additionally, Ms. Myers has served on several management committees at Kirkland, including Audit, Finance, and Associate and Partner Compensation, and served as the Chair of Kirkland’s Administrative Committee from 2009 until her retirement. Ms. Myers serves as a member of the board of directors of several private companies and community and cultural organizations and chairs committees of the boards for some of these organizations including Human Resource/Compensation and Nominating and Membership. Other Current Public Board Directorships: In November 2022, Ms. Myers was elected as an independent member of the board of LCI Industries, a NASDAQ listed international manufacturer and supplier of components for the recreation and transportation product markets. She is a member of the Audit Committee, the Corporate Governance, Nominating, and Sustainability Committee, and the Risk Committee of the board of LCI Industries. Director Qualifications: Ms. Myers’ qualifications to serve on the Board include her demonstrated leadership skills as head of Kirkland’s Debt Finance Practice Group, her significant experience advising major public and private companies with respect to sophisticated financing transactions, and her wide exposure to issues encountered in the management of a global organization which she has acquired through her many committee memberships at Kirkland. | ||||
Director Since: February 2020 Board Committees: •Audit and Risk •Capital Structure and Asset Management •Compensation and Human Capital •Nominating, Governance and Corporate Social Responsibility (Chair) Age: 59 Background and Skills: •Senior Leadership •Governance •Corporate Social Responsibility •Human Capital •Finance •Legal | |||||
| JAMES B. NISH | |||||
 | Professional Experience: James Nish has served as a Director of the Company since 2015. He brings to the Board over 25 years of investment banking experience serving clients in a variety of international industrial manufacturing markets. Most recently, he led the Mid-Cap Corporate Investment Banking team at J.P. Morgan Chase. Prior to that, he was head of the Industrial Manufacturing Group at Bear Stearns, where he worked for 22 years. Other Current Public Board Directorships: He also serves on the board and Audit Committee of Eneti, Inc., a NYSE listed company that focuses on marine-based renewable energy by owning and operating wind turbine installation vessels and providing related services. Eneti, Inc. serves offshore wind farm developers and integrated energy companies. Additionally, he serves on the board of Alert 360, a privately held home automation company. Director Qualifications: Mr. Nish’s qualifications to serve on the Board include his experiences centered on helping global industrial manufacturing companies accelerate their growth through mergers, acquisitions, and capital market transactions. A Certified Public Accountant, he has extensive experience in accounting, finance, personnel assessments, and currently serves as an adjunct professor at Baruch College and Pace University where he teaches both undergraduate business and MBA courses. | ||||
Director Since: July 2015 Board Committees: •Audit and Risk (Chair) •Capital Structure and Asset Management (Chair) Age: 64 Background and Skills: •Senior Leadership •Governance •Corporate Social Responsibility •Finance •Operations •Portfolio Management | |||||
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| PROPOSAL 1 - ELECTION OF DIRECTORS | ||
| ATLEE VALENTINE POPE | |||||
| Professional Experience: Atlee Valentine Pope has served as a Director of the Company since February 2020, and Lead Independent Director since January 2022. Ms. Pope served as the Chief Executive Officer of Blue Canyon Partners, Inc. (“Blue Canyon”), a business-to-business growth strategy consulting firm which she co-founded in 1998. Ms. Pope was President of Blue Canyon from its inception in 1998 through 2013 at which time Ms. Pope became Chief Executive Officer. In addition to her responsibilities as Chief Executive Officer of Blue Canyon, Ms. Pope served client firms in the area of global value creation, price realization, and digital strategies. Prior to serving as President of Blue Canyon, Ms. Pope served as an Executive Director of Baker & Company, a privately-held consulting firm which served the automotive and telecommunications industries. Ms. Pope has over 35 years of experience in advising Fortune 500 boards and c-suite executives. Director Qualifications: Ms. Pope’s qualifications to serve on the Board include her demonstrated leadership skills as an executive at Blue Canyon and her significant experience with designing global growth strategies and actions plans. | ||||
Lead Independent Director Director Since: February 2020 Board Committees: •Audit and Risk •Capital Structure and Asset Management •Compensation and Human Capital •Nominating, Governance and Corporate Social Responsibility Age: 67 Background and Skills: •Senior Leadership •Governance •Human Capital •Finance •Marketing •Operations •Portfolio Management | |||||
2023 PROXY STATEMENT 11
| PROPOSAL 1 - ELECTION OF DIRECTORS | ||
| MANISH H. SHAH | |||||
 | Professional Experience: Manish Shah has served as a Director of the Company since February 2021. Since September 2022, Mr. Shah has served as Chief Digital Transformation Officer at ServiceNow, an IT service management and workflow automation company. Mr. Shah is and has been the founder and principal member of Gnosis Advisory Group, a business leadership advisory firm, since December 2021. Prior to Gnosis Advisory Group, Mr. Shah served as Senior Vice President and Chief Information Officer of Community Health Systems responsible for patient digital experience across eighty-five hospitals operating in sixteen states from 2013 to 2020. Mr. Shah also oversaw the technology and digital systems development and implementation supporting the Community Health Systems’ various businesses and functions with his primary focus on digital transformation, interoperability exchange, and business intelligence and analytics. Prior to Community Health Systems, Mr. Shah was Senior Vice President of IT Infrastructure for Aurora Health Care. In 2021, Mr. Shah accepted a Board of Trustees role at National Philanthropic Trust and is a member of the Audit and Risk Committee and Human Resource Committee. Mr. Shah was previously a member of The Heritage Healthcare Technology Fund, the Nashville Technology Council, The Center for Medical Interoperability, Google Productivity & Collaboration Customer Advisory Board, and an Advisory Board member for both AT&T and Verizon. Director Qualifications: Mr. Shah’s qualifications to serve on the Board include his experience in senior leadership and implementation across business systems technology, digital business models, and cyber security. | ||||
Director Since: February 2021 Board Committees: •Audit and Risk •Nominating, Governance and Corporate Social Responsibility Age: 58 Background and Skills: •Senior Leadership •Governance •Corporate Social Responsibility •Digital •Finance •Operations •Portfolio Management | |||||
| THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE “FOR” ALL NOMINEES IN PROPOSAL 1 | ||||||||
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CORPORATE GOVERNANCE | ||
The Board of Directors is responsible for oversight of management of the business and affairs of the Company with the objective of enhancing stockholder value. The Company has corporate governance practices and policies which the Board of Directors follows with respect to various matters, such as director responsibilities, compensation, and access to management. The Company’s corporate governance documents are available under the Governance Documents section of the Corporate Governance page of the Company’s website at www.gibraltar1.com. Board Leadership | ||
BOARD CHAIR William T. Bosway has served as President, Chief Executive Officer and a Director of the Company since January 2019, and Chairman of the Board of Directors since January 2022. | | ||||
| LEAD INDEPENDENT DIRECTOR Atlee Valentine Pope has served as a Director of the Company since February 2020. Chair of the Nominating, Governance and Corporate Social Responsibility Committee from January 2021 to December 2021, and Lead Independent Director since January 2022. | ||||
The Board of Directors does not have a policy as to whether the roles of Chair of the Board and Chief Executive Officer should be separate or combined and as such has the authority and flexibility to select the appropriate leadership structure for the Company at the time. Under the Company’s Second Amended and Restated Bylaws, the Chair of the Board presides over meetings of the Board of Directors and meetings of the stockholders, while the CEO has general authority for strategic initiatives involving the business and operational affairs of the Company, subject to the supervision and oversight of the Board. Currently, the Company's leadership structure includes the combined role of Chair of the Board and CEO, held by Mr. Bosway. The Board of Directors believes combining the role of Chair of the Board and CEO brings to the Board important expertise and leadership and enhances decisive strategic direction and strong execution. The skills and experience of Mr. Bosway are well suited for the role of Chair, putting the Board in a strong position to oversee strategy development, understand market developments, and mitigate risk appropriately. The Board of Directors has determined, after consultation with Korn Ferry, its compensation and corporate governance advisor, that having a combined role of Chair of the Board and CEO is in the best interests of the Company and its stockholders at this time. To ensure strong independent leadership on the Board, under the Company's corporate governance guidelines, if the roles of Chair of the Board and the CEO are combined, the independent directors annually appoint a Lead Independent Director to strengthen the Board's independent oversight of the policies and strategies of the Company's management. The Company's Lead Independent Director has significant authority in facilitating the Board's independent oversight of management, with key duties and responsibilities including: •Preside at all meetings of the Board at which the Board Chair is not present; •Collaborate with the Board Chair in determining the need for special meetings of the Board; •Call meetings or executive sessions of the independent members of the Board; •Preside at all executive sessions of the independent members of the Board; •Act as principal liaison between the Board Chair and the independent members of the Board relating to matters which are not the responsibility of any of the standing committees of the Board; •Consult with the Board Chair regarding topics to be considered at Board meetings and information provided with respect to such topics; •Approve Board meeting agendas; | ||
2023 PROXY STATEMENT 13
| CORPORATE GOVERNANCE | ||
•Consult with the Board Chair regarding engagement of consultants by the Board; and •Be available for direct communication with major stockholders or other major stakeholders, in consultation with management and the chair of the applicable Board Committee, as appropriate The Board believes that an effective Lead Independent Director, such as Ms. Pope, who has significant and clear delineated responsibilities described above, ensures strong, independent oversight of management and promotes effective governance and Board efficiency. The Board believes that this leadership structure ensures that each director's experience, knowledge and insight is leveraged to provide strategic guidance in a demanding and rapidly changing business environment. In addition, the independent directors of our Board meet in executive session at each quarterly board meeting and the Lead Independent Director reports any matters that arise in such executive sessions directly to the Chair and Chief Executive Officer. All of the Board’s key committees - the Audit and Risk Committee; the Capital Structure and Asset Management Committee; the Compensation and Human Capital Committee; and the Nominating, Governance and Corporate Social Responsibility Committee - are comprised solely of and led by independent directors. | ||
Board Retirement Policy and Tenure Our corporate governance guidelines require our non-employee directors to submit an offer to resign from the Board to the Chair of the Nominating, Governance and Corporate Social Responsibility Committee upon reaching the age of 72, and following each succeeding birthday. We do not have any other tenure limitations, as we believe our retirement policy and succession planning to replace natural turnover achieve the appropriate balance between maintaining long-term directors with deep institutional knowledge and refreshing the Board with new directors who bring new perspectives and diversity to the Board. Whenever possible, we structure director retirements and new director appointments to overlap so institutional knowledge can be transferred to new directors. As of March 17, 2023, the Company's average tenure for directors standing for election is four years of service. | ||
Risk Oversight and Management The Board is actively engaged in the oversight of strategies adopted by management for mitigating risks faced by the Company. The effective oversight of risks to which the Company may be exposed requires an understanding of the nature of the risks, the steps management is taking to manage the risks, and a determination of the level of risk which is acceptable to the Company. The involvement of the Board of Directors in reviewing the Company’s enterprise risk management process provides the Board with the information and analysis, if appropriate, to require changes in the Company’s operations or strategies to reflect the Board’s determination of the acceptable level of risk for the Company. Risks may arise in many different areas, including, among many others, business strategy; financial condition; competition for talent; operational efficiency; cyber-security; quality assurance; environmental, health, and safety; availability of raw materials; supply chain management; reputation; business interruptions or disasters; customer spending patterns; and intellectual property. The Board believes that, in light of the interrelated nature of the Company’s risks, oversight of risk management is ultimately the responsibility of the full Board. While the Board retains ultimate responsibility for oversight of the risks affecting the Company, the Audit and Risk Committee has responsibility for assisting the Board in the review and oversight of risks affecting the Company and risk management strategies developed by management. In addition, committees assist the Board in overseeing and reviewing risk relating to specific programs. The Compensation and Human Capital Committee reviews compensation program structure and design and the related risks and opportunities. The Nominating, Governance and Corporate Social Responsibility Committee oversees the Company's governance policies, Board structure, leadership and independence. In carrying out this critical responsibility, the Board has implemented an enterprise risk management program designed to: •Understand the critical risks in the Company's business and strategy and risk mitigation strategies; •Evaluate the Company’s risk management process and whether it functions adequately; •Facilitate open communication between management and the Directors; and •Foster an appropriate culture of integrity and risk awareness. | ||
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| CORPORATE GOVERNANCE | ||
The Board discusses risk in general terms throughout the year at its meetings as well as risks in relation to specific proposed actions. While the Board oversees the enterprise risk management process, management is responsible for implementing and executing controls designed to limit risk to the level deemed to be acceptable to the Board. The Company has internal processes and an effective internal control environment which facilitate the identification and management of risks and the quality and effectiveness of the risk related communications with the Board. These include an enterprise risk management program under the leadership of our Chief Financial Officer and our Vice President of Internal Audit, regular reports from management on business strategy, a Code of Ethics and Policy Statement, and product quality standards. Management communicates routinely with members of the Board on the significant risks identified and how they are being managed. Information Security Risk Oversight The Board recognizes the importance of maintaining the trust and confidence of our customers, employees, and trading partners, while simultaneously preserving the integrity of our Company's information systems. To those ends, the Board is responsible for the oversight of the Company's information security risk management. To more effectively prevent, monitor, detect, and respond to information security threats, the Company has a dedicated cybersecurity leader reporting directly to the Company's Chief Digital Information Officer. The cybersecurity team is responsible for leading enterprise-wide information security strategy and developing awareness, training, policy, standards, architecture, and processes. The Board is briefed quarterly by senior management on projects to strengthen the Company's cybersecurity controls, assessments of the Company's security program, and the state of our current cybersecurity monitoring. | ||
Stockholder Engagement The Company’s executive management team routinely meets with its stockholders to discuss the Company’s performance and strategic plan. Further, our executive management team leads stockholder outreach engagements, where we solicit feedback from stockholders on their priorities on corporate governance, compensation, and environmental and social matters. Our executive management team is committed to continuing a formal stockholder outreach program. Additionally, our executive management team, including the Company’s Chairman, President and Chief Executive Officer, and Chief Financial Officer, regularly engage in meaningful dialogue with the Company’s stockholders through our quarterly earnings calls, investor conferences, and other channels for communication. | ||
Independence of Directors The Board of Directors has determined that each of Mark Barberio, Craig Hindman, Gwendolyn Mizell, Linda Myers, James Nish, Atlee Valentine Pope, and Manish Shah is and, while he served as the Chairman Emeritus through May 2022, William Montague was, an “independent director” as defined under, the rules of Nasdaq and the SEC, which the Board has adopted as the standards by which it will determine independence. William Bosway serves as the Company's President and Chief Executive Officer and therefore is not an independent director. Each member of the Audit and Risk Committee, the Capital Structure and Asset Management Committee, the Compensation and Human Capital Committee, and the Nominating, Governance and Corporate Social Responsibility Committee is independent under Nasdaq rules. In addition, the Board has affirmatively determined that the members of the Audit and Risk Committee and Compensation and Human Capital Committee qualify as independent in accordance with the additional independence rules established by the SEC and Nasdaq. Board Committees and Related Matters The Board has four standing committees - the Audit and Risk Committee, the Capital Structure and Asset Management Committee, the Compensation and Human Capital Committee, and the Nominating, Governance and Corporate Social Responsibility Committee. Copies of the charters of these committees are available on the Company’s website at www.gibraltar1.com. | ||
2023 PROXY STATEMENT 15
| CORPORATE GOVERNANCE | ||
The current composition of the Board of Directors and each board committee as of April 3, 2023, is set forth below: | ||
| Director | Board of Directors | Audit and Risk Committee | Capital Structure and Asset Management Committee | Compensation and Human Capital Committee | Nominating, Governance and Corporate Social Responsibility Committee | |||||||||||||||||||||||||||
| Mark Barberio | M | M* | M | |||||||||||||||||||||||||||||
William Bosway (1) | C | |||||||||||||||||||||||||||||||
Craig Hindman (2) | M | M | C | |||||||||||||||||||||||||||||
| Gwendolyn Mizell | M | M | M | |||||||||||||||||||||||||||||
Linda Myers (3) | M | M | M | M | C | |||||||||||||||||||||||||||
| James Nish | M | C* | C | |||||||||||||||||||||||||||||
Atlee Valentine Pope (4) | L | M | M | M | M | |||||||||||||||||||||||||||
Manish Shah (5) | M | M | M | |||||||||||||||||||||||||||||
M = Member C = Chair L = Lead Independent Director * = Financial Expert | ||||||||||||||||||||||||||||||||
(1)Bosway was appointed Chair of the Board effective January 1, 2022. (2)Hindman was appointed to the Capital Structure and Asset Management Committee as of March 20, 2023. Prior to such date, he had served on the Nominating, Governance and Corporate Social Responsibility Committee. (3)Myers was appointed chair of the Nominating, Governance and Corporate Social Responsibility Committee effective January 1, 2022. (4)Pope was appointed as Lead Independent Director and appointed to the Audit and Risk Committee, and Capital Structure and Asset Management Committee effective January 1, 2022. (5)Shah was appointed to the Nominating, Governance and Corporate Social Responsibility Committee as of March 20, 2023. Prior to such date, he had served on the Capital Structure and Asset Management Committee. | ||
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| CORPORATE GOVERNANCE | ||
In 2022, the Board of Directors held seven meetings. Each director attended at least 75% of the aggregate number of meetings of the Board of Directors and committees on which each served during the period of his or her service in 2022. The Company does not have a policy regarding director attendance at the annual meeting, but they are encouraged to attend. Our 2022 annual meeting was attended by all but one of the Directors. | ||
Audit and Risk Committee | ||||||||
| Committee Members: | ||||||||
| James Nish (Chair) | Atlee Valentine Pope | Number of meetings in fiscal 2022: 6 | ||||||
| Mark Barberio | Manish Shah | Report: Page 71 | ||||||
| Linda Myers | ||||||||
| * Each committee member is independent as required by the Nasdaq and SEC rules applicable to such committee. | ||||||||
The Audit and Risk Committee acts in accordance with its charter to assist the Board of Directors in its responsibility to oversee: •management's conduct of the Company's financial reporting; •management's establishment and conduct of the Company's systems of internal accounting and financial controls; •the qualifications, engagement, compensation, independence and performance of the Company's independent auditors, the conduct of the annual audit and any other audit, attest or review services, and the engagement of the independent auditors to provide any non-audit services; •the process and activities performed by the Company's internal audit function; •the preparation of the audit committee report; •the Company's legal and regulatory compliance; •the review and ratification or approval on an annual basis, of transactions between the Company and officers, directors and other related parties; •the Company's risk assessment and risk management guidelines and policies; and •the Company's codes of conduct. The Board of Directors has made a determination that each of Mark Barberio and James Nish is an “audit committee financial expert” under the standards established by SEC rules. | ||
Capital Structure and Asset Management Committee | ||||||||
| Committee Members: | ||||||||
| James Nish (Chair) | Atlee Valentine Pope | Number of meetings in fiscal 2022: 7 | ||||||
| Mark Barberio | Craig Hindman | |||||||
| Linda Myers | ||||||||
Note: Manish Shah served on the committee until March 20, 2023. | ||||||||
The Capital Structure and Asset Management Committee acts in accordance with its charter to consult with the Company’s management and assist the Board of Directors in its oversight of the Company’s capital structure, financing activities, merger, acquisition and divestiture transactions, investment decisions and other matters of financial importance to the Company. | ||
2023 PROXY STATEMENT 17
| CORPORATE GOVERNANCE | ||
Compensation and Human Capital Committee | ||||||||
| Committee Members: | ||||||||
| Craig Hindman (Chair) | Linda Myers | Number of meetings in fiscal 2022: 5 | ||||||
| Gwendolyn Mizell | Atlee Valentine Pope | Report: Page 44 | ||||||
| * Each committee member is independent as required by the Nasdaq rules applicable to such committee. | ||||||||
The Compensation and Human Capital Committee acts in accordance with its charter to fulfill the Board's responsibilities relating to establishment of compensation of the Company's executive officers and non-employee directors and to provide oversight and strategic guidance on the Company's human capital management including corporate culture, diversity and inclusion, talent management, career development and progression, key executive succession planning, benefit plans and policies, workplace environment and safety, employee relations and other matters impacting the Company's ability to attract and retain a stable and productive workforce. The Compensation and Human Capital Committee also monitors the Company's progress toward the overall implementation of its diversity and inclusion objectives. The Compensation and Human Capital Committee reviews and approves corporate goals and objectives relevant to the compensation payable to the CEO and other executive officers, evaluates the performance of the CEO and other executive officers in light of those goals and objectives, and establishes the compensation, including base salary, annual incentive compensation and long term compensation of the CEO and other executive officers based on this evaluation. The Compensation and Human Capital Committee also reviews and approves the compensation, including base salary, annual incentive compensation and long term compensation, payable to the direct reports of the CEO. The Compensation and Human Capital Committee is also responsible for the administration of the Company’s incentive compensation plans and authorization of grants of equity-based awards pursuant to such plans. The Compensation and Human Capital Committee delegates its authority for the administration of the incentive compensation plans and authorization of grants of equity-based awards pursuant to such plans to executive management with regards to non-executive management of the Company. To fulfill its responsibilities, the Compensation and Human Capital Committee has the authority to retain and obtain advice from advisors. The Compensation and Human Capital Committee employs a nationally recognized compensation consultant, Korn Ferry, to serve as an independent compensation advisor, perform market studies of compensation programs offered by a peer group of companies, and provide information on market compensation practices. The Compensation and Human Capital Committee determined Korn Ferry is an independent advisor by assessing the firm on six independence factors as prescribed by the SEC. The Compensation and Human Capital Committee worked with Korn Ferry and the Company’s executive management team to make final decisions regarding the design of the programs used to compensate the Company’s executive officers and directors in a manner which is consistent with the Company’s compensation objectives. The amount of fees paid for these services performed by Korn Ferry was $151,667 during 2022. | ||
Nominating, Governance and Corporate Social Responsibility Committee | ||||||||
| Committee Members: | ||||||||
| Linda Myers (Chair) | Atlee Valentine Pope | Number of meetings in fiscal 2022: 4 | ||||||
| Gwendolyn Mizell | Manish Shah | |||||||
| * Each committee member is independent as required by the Nasdaq rules applicable to such committee. | ||||||||
Note: Craig Hindman served on the committee until March 20, 2023. | ||||||||
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| CORPORATE GOVERNANCE | ||
The purposes of the Nominating, Governance and Corporate Social Responsibility Committee are to: •identify and recommend to the Board the nomination of individuals qualified to become Board and committee members; •establish and implement policies and procedures relating to the nominations of qualified candidates; •develop and recommend to the Board a set of corporate governance guidelines for the Company; •provide oversight and strategic guidance on environmental, social and governance matters significant to the Company; and •oversee, review, and make periodic recommendations to the Board concerning the Company’s corporate governance guidelines and policies. The Nominating, Governance and Corporate Social Responsibility Committee is responsible for establishing criteria for Board membership, including experience and independence, and for reviewing candidates for the Board, including those recommended by stockholders. The Nominating, Governance and Corporate Social Responsibility Committee oversees the directors’ continuing education, which includes seminars focused on strategic and governance issues and the evaluation process for the Board and committees. | ||
The Nominating, Governance and Corporate Social Responsibility Committee also provides strategic guidance on the Company's approach to corporate social responsibility and ensures it aligns with the Company's overall business strategy and corporate best practices and on Company social responsibility policies and initiatives, including but not limited to human rights, the Company's stakeholder relationships, and product safety. | ||
Director Nomination Process When the Nominating, Governance and Corporate Social Responsibility Committee recruits new director candidates, the committee seeks to identify candidates for nomination who are highly qualified, willing to serve as a member of the Company’s Board and will be able to serve the best interests of stockholders. The Nominating, Governance and Corporate Social Responsibility Committee considers the following when identifying new director candidates: •integrity, high personal and professional ethics, mature judgment; •whether a candidate is “independent” within the meaning of such term in accordance with the applicable listing standards of Nasdaq and the rules promulgated by the SEC; and •a diversity of background and achievement including in business, government, education and technology as relevant to the Company’s strategic needs and desire to have a diverse board composition. | ||
The Nominating, Governance and Corporate Social Responsibility Committee believes that, given the size and complexity of the Company’s operations, the best interests of the Company’s stockholders will be served by a Board composed of individuals that contribute to the Board’s overall diversity - diversity being broadly construed to mean a variety of opinions, perspectives, as well as personal and professional experiences and backgrounds. Accordingly, the Nominating, Governance and Corporate Social Responsibility Committee seeks to identify candidates for nomination who will contribute to the diversity of perspectives present in Board deliberations. During the nomination process, the Nominating, Governance and Corporate Social Responsibility Committee considers whether the Board’s composition reflects an appropriately diverse mix of skills and experience in relation to the needs of the Company. The Nominating, Governance and Corporate Social Responsibility Committee identifies candidates from several sources including directors on the Board, Gibraltar’s executive management team, search firms and research, including database and internet searches. All potential candidates for a director role, including directors being nominated for re-election, are considered and evaluated against the qualifications outlined above. | ||
2023 PROXY STATEMENT 19
| CORPORATE GOVERNANCE | ||
Stockholder Recommendations of Nominees The Company has adopted a policy regarding stockholder recommendations of nominees for director to be submitted for evaluation to the Nominating, Governance and Corporate Social Responsibility Committee. A stockholder may, at any time prior to the deadline for the submission of stockholder proposals, recommend a nominee for consideration by the Nominating, Governance and Corporate Social Responsibility Committee by sending a recommendation, in writing, to the Secretary of the Company or any member of the Nominating, Governance and Corporate Social Responsibility Committee, together with such supporting material as the stockholder deems appropriate. Any person recommended by a stockholder in accordance with this policy will be considered by the Nominating, Governance and Corporate Social Responsibility Committee in the same manner and by the same criteria as other potential nominees. During 2022, the Nominating, Governance and Corporate Social Responsibility Committee did not receive any nomination recommendations from stockholders. | ||
Succession Planning Considering the critical importance of executive leadership to Gibraltar’s success, we have a succession planning process that is enterprise-wide for managers up to and including our Chief Executive Officer. Our Board of Directors’ involvement in the process includes a review of succession plans and recommendations as to succession in the event of each executive officer’s termination of employment for any reason. Our Chief Executive Officer provides an annual review to the Board assessing the performance of the executive officers of Gibraltar. The Board has the responsibility to review succession plans for the Chief Executive Officer and other key executive positions. The Board and the Nominating, Governance and Corporate Social Responsibility Committee also work together to assess the composition, tenure, and diversity of the Board of Directors and evaluate succession planning considerations when recommending Board nominees. | ||
Director Education New directors participate in an orientation process to become familiar with the Company. This process includes a review of the Company's strategic plans and businesses, significant financial matters, core values, including ethics, compliance, corporate governance practices and other key policies and practices through a review of Company and Board background materials, and meetings with the Company’s executive management. Each Director is required to complete the Company's annual ethics and compliance and cybersecurity training which was approximately 11.5 hours during 2022. The Company provides directors with continuing education regarding corporate governance and specific business-related issues and strategic priorities. Throughout the year, the Board also regularly meets with business unit management and participates in facility tours. Additionally, the Company engages third parties to provide presentations on relevant topics during board meetings. Directors are also provided access to third party resources and membership through organizations such as the National Association of Corporate Directors and the opportunity to participate in third party educational programs. | ||
Communication with the Board of Directors Stockholders may send communications to the Board of Directors in care of the Secretary at the Company’s headquarters located at 3556 Lake Shore Road, PO Box 2028, Buffalo, NY 14219-0228. All mail from stockholders will be opened and logged. All relevant communication will be forwarded promptly to the Directors. Mail addressed to a particular member of the Board will be forwarded to that member. Mail addressed to “Outside Directors” or “Non-Management Directors” or similar addressees will be sent to the Lead Independent Director. | ||
Employee, Officer and Director Hedging The Company, pursuant to the terms of its Insider Trading Policy, prohibits all directors, officers, employees, terminated employees and agents from engaging in hedging transactions related to, or from pledging or creating a security interest in, the Company’s common stock, publicly traded debt instruments and restricted stock units they hold. | ||
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CORPORATE SOCIAL RESPONSIBILITY | ||
Over the last eight years, we have been transforming our company to focus on solving some of the humanity’s most challenging opportunities – from harnessing energy and growing food more sustainably to living and working with greater ease, efficiency, and comfort. Transforming the Company positions it to play a significant role in sustainable development issues, building partnerships with key players that help advance critical technologies, strengthening the Agtech, Renewables, Residential and Infrastructure businesses, and enabling the Company to better respond to humanity's evolving needs. The Nominating, Governance and Corporate Social Responsibility Committee provides oversight and strategic guidance on environmental, social and governance matters significant to the Company, including overseeing, reviewing or making recommendations to the Board concerning the Company's governance and corporate social responsibility guidelines and policies. The foregoing oversight and strategic guidance is focused on: •the Company's approach to corporate social responsibility and to ensure it aligns with the Company's overall business strategy and corporate best practices; •periodic review of external developments which are likely to have a significant influence on the Company's reputation and/or its ability to conduct its business in a socially responsible manner; •the Company's social responsibility policies and initiatives, including but not limited to human rights, the Company's stakeholders relationships, and product safety; and •the Company's policies and initiatives relating to the environment with respect to energy management, climate change, and sustainability. The Compensation and Human Capital Committee provides oversight and strategic guidance on the Company's human capital management including corporate culture, diversity and inclusion, talent management, career development and progression, key executive succession planning, benefit plans and policies, workplace environment and safety, employee relations and other matters impacting the Company's ability to attract and retain a stable and productive workforce. The Company is committed to making a difference in the lives of the people the Company's business touches, and to creating meaningful impact every day through the Company's work and relationships. A sense of responsibility to people and the planet is woven into the core values that define the Company's purpose and drive the Company's culture. These values include: •Make it better - The Company challenges itself and its way of thinking every day to exceed the needs of the Company's customers. •Make it right - The Company cares about doing the right thing for each other, customers, and communities by holding the Company to the highest standards of ethics and safety. •Make it together - The Company works collaboratively with customers and each other - teamwork sets the Company apart. The Company works to create a culture that is inclusive of different perspectives and experiences. •Make an impact - The Company is here to make a difference. The Company drives change and delivers meaningful value to customers, investors, and community. We recognize the close connection between corporate governance and social responsibility, and the importance of developing clear priorities and lines of accountability for the Company and its impact as we operate and grow. A collaboration between the Board, the Company's business leaders, and employees drives the strategic direction and management of our key priorities, and the structure and processes of our governance efforts reflect our commitment to continuous improvement. | ||
2023 PROXY STATEMENT 21
| CORPORATE SOCIAL RESPONSIBILITY | ||
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22
| CORPORATE SOCIAL RESPONSIBILITY | ||
In January 2023, the Company released its annual Corporate Social Responsibility Report (CSR Report). Highlights of the report include: •Gibraltar conducted seven comprehensive energy audits at critical manufacturing plants, identifying opportunities to reduce energy consumption and increase energy efficiency. •The company decreased energy intensity by Net Sales 8.2% from 64.7 MWh in 2020 to 59.4 MWh in 2021. •Gibraltar has built greater diversity of thought, experience and perspective on its Board of Directors with a broadened range of skills and tenure and expanded the responsibilities of its CSR Committee. A copy of the Company's CSR Report is available on the Company's website under "Corporate Social Responsibility." Gibraltar is dedicated to making a positive impact through a commitment to Corporate Social Responsibility. Our efforts continue to focus on: | ||
 | The safety, well-being, and success of our people is our top priority. We are dedicated to developing our people’s potential as professionals and future leaders, drawing on the unique abilities of each team member to build an inclusive culture of difference-makers. | ||||
| Sharing our success with the communities where we live and work is vital to our purpose. By supporting local nonprofits and institutions as investors and volunteers, we help build resilience and strengthen the bonds that will help our communities thrive. | |||||
| Our work is firmly rooted in making life better for people and the planet; we innovate in the service of possibility, acting responsibly to create positive, lasting change in our world. We promote sustainability across our value chain, developing products and services for our customers that reduce environmental impact and improve quality of life. | |||||
CSR is integral to our three pillars of business systems, portfolio management and organization development. We have accelerated our initiatives to create a safer work environment, expand the experience base and the diversity of our organization, and to identify opportunities to reduce environmental impact. For us, corporate social responsibility is inseparable from not only what we do, but who we are. A sense of responsibility to people and the planet is built into our DNA. We think of corporate social responsibility as an evolution in who we are rather than a revolution in what we do. It's an opportunity to be more accountable, strategic, and transparent about how we think and act, and to deepen our commitment to Our People, Our Communities, and The World. | ||
2023 PROXY STATEMENT 23
COMPENSATION OF DIRECTORS | ||
Our Compensation and Human Capital Committee engaged Korn Ferry to review survey information, and provide other publicly available information and advice to the Compensation and Human Capital Committee with respect to compensation-related matters for non-employee director compensation for a peer group of companies. The peer group is the same as the peer group disclosed in the section entitled “Compensation Discussion and Analysis” below. Non-Employee Director Compensation Program The Compensation and Human Capital Committee reviewed information provided by Korn Ferry relating to Board compensation in relation to compensation earned by the directors of our peer group of companies. After this review in April 2022, the Compensation and Human Capital Committee approved a compensation program for non-employee directors consisting of the following cash compensation, effective as of May 4, 2022: •an annual cash retainer of $65,000; •an annual payment for each Board committee on which he or she serves equal to $10,000; •an additional annual fee of $25,000 for the Lead Independent Director; •an additional annual fee to the Chair of the Audit and Risk Committee of $10,000; •an additional annual fee to the Chair of the Compensation and Human Capital Committee of $7,500; •an additional annual fee to the Chair of the Capital Structure and Asset Management Committee of $7,500; and •an additional annual fee to the Chair of the Nominating, Governance and Corporate Social Responsibility Committee of $5,000. All retainers are paid quarterly in advance unless deferred under the MSPP as describe below. In addition, the Compensation and Human Capital Committee approved annual grants of stock to each non-employee director having an aggregate fair value equal to $105,000, which is consistent with the aggregate fair value of the 2021 annual grant. These shares vest immediately and are delivered to directors unless a Director elects to defer for future issuance the receipt of all or a portion of the stock award received. Pursuant to this approval, non-employee directors received awards of stock in May 2022. The Company does not provide any perquisites to directors, but does reimburse directors for out-of-pocket expenses incurred for continuing education and in attending Board and committee meetings. Directors who are employees or officers of the Company do not receive any additional compensation for Board services. Management Stock Purchase Plan for Non-Employee Directors Our Management Stock Purchase Plan (“MSPP”) permits non-employee directors to defer their receipt of payment of a portion of their cash retainer to an account ("MSPP Deferral Account") established for the non-employee director which is credited with hypothetical units that track the common stock of the Company (“Deferral Units”) equal to the number of shares of the Company’s common stock that could have been purchased using the amount of director fees deferred based on a 90-day rolling price per share of the Company's stock as deferral date. Under the MSPP, the amount deferred and to be paid in cash to a non-employee director upon termination of the non-employee director's service on the Board is equal to the Deferral Units credited to their MSPP Deferral Account multiplied by the 200-day rolling average price per share of the Company’s stock, determined as of the immediately preceding calendar-month's end date immediately preceding the date the participant becomes eligible to receive a distribution of their account under the MSPP. | ||
Payment of the amount determined above is made to the non-employee director based on an election made by the non-employee director prior to the deferral in either (a) a lump sum, (b) five substantially equal annual installments, or (c) ten substantially equal annual installments, in each case, beginning six months after the date of termination. During the period that the installment payments are being made, the undistributed value of the non-employee director's account will earn interest at a rate equal to the average annualized rate of interest payable on ten-year US Treasury Notes plus two percent (2%). Deferral Plan for Non-Employee Directors Non-employee directors have the right to defer receipt of all, or a portion, of the stock award that they receive. The deferred share awards are in the form of Deferred Share Units ("DSUs"). DSUs are converted to shares and issued six months after termination of the non-employee director's service. | ||
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| COMPENSATION OF DIRECTORS | ||
2022 Director Compensation | |||||||||||
| The table below sets forth the compensation of each non-employee director in 2022. | |||||||||||
| Name | Fees Earned or Paid in Cash (1) ($) | Stock Awards (2) ($) | Total ($) | ||||||||
| Mark G. Barberio | 85,000 | 105,017 | 190,017 | ||||||||
| Craig A. Hindman | 92,500 | 105,017 | 197,517 | ||||||||
| Gwendolyn G. Mizell | 85,000 | 105,017 | 190,017 | ||||||||
| William P. Montague (3) | 69,082 | 35,011 | 104,093 | ||||||||
| Linda K. Myers | 111,836 | 105,017 | 216,853 | ||||||||
| James B. Nish | 102,500 | 105,017 | 207,517 | ||||||||
| Atlee Valentine Pope | 130,000 | 105,017 | 235,017 | ||||||||
| Manish H. Shah | 85,000 | 105,017 | 190,017 | ||||||||
(1)Shah deferred 100% of his annual cash retainer into Deferral Units under the Company's MSPP and received 1,111.22 Deferral Units. Myers deferred 100% of her annual cash retainer into Deferral Units under the Company's MSPP and received 1,111.22 Deferral Units. (2)Represents awards of shares granted under the Amended and Restated 2016 Stock Plan for Non-Employee Directors. The amounts represent the grant date fair value of the award of shares, which is the closing trading price of a share of the Company's common stock on the grant date multiplied by the number of shares subject to the award. The closing price per share of the Company's common stock on May 6, 2022 (the grant date) was $42.69. The Company does not pay fractional shares. (3)Montague served as a director in 2022 until his retirement from the Board and from all committees of the Board immediately prior to the 2022 Annual Meeting held on May 4, 2022. The closing price per share of the Company's common stock on May 3, 2022 (the grant date) was $39.25. The Company does not pay fractional shares. | ||
Stock Awards Vested But Not Distributed at Fiscal Year End | |||||||||||
The following chart summarizes the aggregate number of stock awards vested but not distributed at December 31, 2022 for each Director: | |||||||||||
| Name | Deferred Share Units (1) (#) | Deferral Units (2) (#) | Aggregate Number of Stock Awards Vested But Not Distributed (#) | ||||||||
| Mark G. Barberio | 1,099 | — | 1,099 | ||||||||
| Craig A. Hindman | 11,106 | 10,215 | 21,321 | ||||||||
| Gwendolyn G. Mizell | 1,256 | 534 | 1,790 | ||||||||
| Linda K. Myers | 3,323 | 1,111 | 4,434 | ||||||||
| James B. Nish | 9,859 | 4,440 | 14,299 | ||||||||
| Atlee Valentine Pope | 5,783 | — | 5,783 | ||||||||
| Manish H. Shah | 1,256 | 1,823 | 3,079 | ||||||||
(1)Deferred share units will be converted into shares upon retirement from the Board of Directors. (2)Represents hypothetical units that track the Company's common stock acquired through cash retainer deferrals under the MSPP during the period of the Director’s service that will be converted to cash and paid out upon retirement from the Board as described above under "Management Stock Purchase Plan for Non-Employee Directors." | ||
Non-Employee Director Stock Ownership Guidelines In accordance with the Company's Stock Ownership Policy, non-employee directors are required to hold 350% of their retainer in shares of the Company's common stock or other permitted equity interest within three years of joining the Board. For purposes of determining value of shares held, shares include common stock owned by the non-employee director, including those owned by spouse and/or minor children, deferred share units, and restricted stock units settled in the Company's common stock. The value of shares held is determined based on current fair market value. | ||
2023 PROXY STATEMENT 25
DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY | ||
The following table sets forth certain information regarding the Directors and executive officers of the Company as of March 17, 2023: | ||
| Name | Age | Position(s) Held | ||||||||||||
| William T. Bosway | 57 | Chairman of the Board, President and Chief Executive Officer | ||||||||||||
| Timothy F. Murphy | 59 | Senior Vice President and Chief Financial Officer | ||||||||||||
| Katherine E. Bolanowski | 39 | General Counsel, Vice President and Secretary | ||||||||||||
| Jeffrey J. Watorek | 43 | Vice President and Treasurer | ||||||||||||
| Atlee Valentine Pope | 67 | Lead Independent Director | ||||||||||||
| Mark G. Barberio | 60 | Director | ||||||||||||
| Craig A. Hindman | 68 | Director | ||||||||||||
| Gwendolyn G. Mizell | 61 | Director | ||||||||||||
| Linda K. Myers | 59 | Director | ||||||||||||
| James B. Nish | 64 | Director | ||||||||||||
| Manish H. Shah | 58 | Director | ||||||||||||
The recent business experience of the directors is set forth above under “Proposal 1 - Election of Directors.” The recent business experience of the executive officers who are not also directors is as follows: | ||
TIMOTHY F. MURPHY was appointed the Company’s Senior Vice President and Chief Financial Officer in April 2017. Prior to April 2017, Mr. Murphy served as the Company’s Treasurer since 2013, Secretary since 2012, and Vice President of Treasury Operations from 2010 to 2013. Mr. Murphy served various roles as a director within the Company’s Finance function from 2004 to 2010. Prior to joining the Company, Mr. Murphy served as a Senior Manager at KPMG. He graduated from the University of Buffalo with a bachelor’s in economics and an MBA with a concentration in accounting. | ||
KATHERINE E. BOLANOWSKI was appointed Vice President and Secretary in February 2022 and has served as the Company’s General Counsel since November 2020. Prior to joining the Company, Ms. Bolanowski held positions as Partner and Associate at Kirkland & Ellis LLP from February 2011 to November 2020. Ms. Bolanowski graduated from Pomona College with a bachelor's degree in economics and holds a law degree from The University of Chicago Law School. | ||
JEFFREY J. WATOREK was appointed Vice President and Treasurer in April 2017 and also served as the Company's Secretary from April 2017 to February 2022. Prior to April 2017, Mr. Watorek served as the Company’s Director of Financial Planning and Analysis since 2012 and Manager of External Reporting from 2008 to 2012. Prior to joining the Company, Mr. Watorek served as a Manager at Ernst & Young. He graduated from the Canisius College with bachelor’s and master’s degrees in accounting. | ||
PROPOSAL 2 - TIMING OF ADVISORY VOTE ON EXECUTIVE COMPENSATION (“SAY-WHEN-ON-PAY”) | ||
We are providing our stockholders with the opportunity to cast an advisory Say-When-on-Pay vote, as required pursuant to Section 14A of the Securities Exchange Act of 1934, as amended. This vote is required to be held at least once every six years and gives our stockholders the opportunity to express a preference as to whether the Say-on-Pay vote will occur every one, two, or three years. Stockholders may vote for one of these options or may choose to abstain from voting on the matter. Based on many factors, including but not limited to those provided below, the Board has determined that a Say-on-Pay vote should occur every year. | ||
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| PROPOSAL 2 - TIMING OF ADVISORY VOTE ON EXECUTIVE COMPENSATION ("SAY-WHEN-ON-PAY") | ||
The Board of Directors recognizes the importance of receiving regular input from our stockholders on important issues, such as our compensation policies and procedures. The Board believes it is appropriate for executive compensation to continue to be submitted to an advisory vote of stockholders on an annual basis. An annual advisory vote on our executive compensation will allow the Board and Compensation and Human Capital Committee to regularly receive an updated evaluation and meaningful input from stockholders on the compensation of our executive officers and on our executive compensation policies, practices and procedures. This vote is an advisory vote and is therefore not binding on the Company or the Board of Directors. However, the Board and the Compensation and Human Capital Committee will carefully review the outcome of the vote and likely make a decision that is consistent with the outcome of the vote as to the policy to be adopted by the Board on the frequency of future Say-on-Pay votes. | ||
| THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE OPTION OF EVERY ONE YEAR AS THE FREQUENCY WITH WHICH STOCKHOLDERS WILL BE PROVIDED AN ADVISORY VOTE ON EXECUTIVE COMPENSATION, AS DISCLOSED PURSUANT TO THE COMPENSATION DISCLOSURE RULES OF THE SEC IN PROPOSAL 2. | ||||||||
PROPOSAL 3 - ADVISORY VOTE ON EXECUTIVE COMPENSATION (“SAY-ON-PAY”) | ||
We are providing our stockholders with the opportunity to cast an advisory vote to approve the compensation of our named executive officers as described in this Proxy Statement (commonly referred to as the “Say-on-Pay” vote) as required pursuant to Section 14A of the Securities Exchange Act of 1934, as amended. The Say-on-Pay vote is advisory, and therefore not binding on the Company or the Compensation and Human Capital Committee. However, the outcome of the vote will provide information to the Company and the Compensation and Human Capital Committee regarding stockholder sentiment about our compensation policies and procedures, which the Compensation and Human Capital Committee will carefully review and consider when making future decisions regarding the compensation of our executive officers. Stockholders are encouraged to read the section below entitled “Compensation Discussion and Analysis,” which describes how our compensation policies and procedures implement our compensation philosophy. In a non-binding advisory vote on the frequency of the say-on-pay proposal held at our 2017 annual meeting of stockholders, a majority of stockholders voted in favor of holding say-on-pay votes annually. In light of this result and other factors considered by the Board, the Board determined that the Company would hold advisory say-on-pay votes on an annual basis until the next required advisory vote on such frequency, which is taking place this year and is included in this Proxy Statement as Proposal 2. Our Compensation and Human Capital Committee has designed our executive compensation program to link pay with performance, and enable the Company to attract and retain qualified talent on the executive management team. We believe the Say-on-Pay vote represents an additional means by which our Compensation and Human Capital Committee may obtain important feedback from our stockholders about the executive compensation program it has designed for our executive officers. | ||
2023 PROXY STATEMENT 27
| PROPOSAL 3 - ADVISORY VOTE ON EXECUTIVE COMPENSATION ("SAY-ON-PAY") | ||
As set forth in the Compensation Discussion and Analysis, the overall objective of our executive compensation program is to attract and retain the talent necessary to ensure Gibraltar’s continued success and to ensure alignment of executive pay with stockholder interests and support Company goals and strategies. To achieve this, the Compensation and Human Capital Committee has designed compensation programs that: •provide competitive total pay opportunity levels relative to an appropriate group of our peer companies; •drive high performance by our executive officers through the use of programs that support and reward desired business results; •provide opportunities for high performing executive officers to achieve above market rewards; •reinforce our commitment to operational excellence, quality, safety, innovation, and the environment; •manage current and future programs and risks; and •provide the flexibility to vary compensation costs through periods of change in our business. A significant portion of the total compensation of our executive officers is performance-based, in that it depends on the achievement of both short and long-term financial goals and strategic objectives. Additionally, by using our common stock as long-term incentive compensation, we incentivize the establishment and implementation of policies and programs which we anticipate will improve the price of our stock. In 2022, performance-based compensation represented 63% of our Chief Executive Officer’s targeted total compensation and an average of 48% of the targeted total compensation of our other named executive officers. We believe that this emphasis on both short and long-term financial performance in our compensation structure aligns executives’ and stockholders’ interests. The Compensation and Human Capital Committee believes that the executive compensation program is closely aligned with the long-term interests of our stockholders and is effective in implementing our compensation philosophy and in achieving our strategic goals. The Say-on-Pay vote gives you, as a stockholder, the opportunity to provide feedback on our executive compensation program by voting for or against the following resolution: “RESOLVED, that the stockholders of Gibraltar Industries, Inc. (the “Company”) approve, on an advisory basis, the compensation of the Company’s named executive officers, as disclosed in this Definitive Proxy Statement pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table, and other related tables and disclosure.” The Board urges stockholders to endorse the executive compensation program by voting in favor of this resolution. As set forth below in the Compensation Discussion and Analysis, the Compensation and Human Capital Committee is of the view that the executive compensation for 2022 was reasonable and appropriate, justified by the performance of the Company and the result of a carefully considered approach. Although the Say-on-Pay vote is non-binding, the Board of Directors and Compensation and Human Capital Committee will carefully consider the outcome of the Say-on-Pay vote, as well as other communications from stockholders relating to our compensation practices, in future determinations concerning our executive compensation program. | ||
| THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE “FOR” THE ADVISORY APPROVAL OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS AS DISCLOSED IN THIS PROXY STATEMENT IN PROPOSAL 3. | ||||||||
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COMPENSATION DISCUSSION AND ANALYSIS | ||
This Compensation Discussion and Analysis (“CD&A”) describes the compensation program and compensation philosophy regarding our Named Executive Officers (“NEOs”) for the 2022 fiscal year. Our NEOs for fiscal 2022 included: | ||
| Named Executive Officer | Title | ||||
| William T. Bosway | President and Chief Executive Officer | ||||
| Timothy F. Murphy | Senior Vice President and Chief Financial Officer | ||||
| Katherine E. Bolanowski | General Counsel, Vice President and Secretary | ||||
| Jeffrey J. Watorek | Vice President and Treasurer | ||||
| Patrick M. Burns (1) | Former Chief Operating Officer | ||||
| Elizabeth R. Jensen (2) | Former Vice President and Chief Human Resources Officer | ||||
(1) Burns served as Chief Operating Officer through December 30, 2022. (2) Jensen served as Vice President and Chief Human Resources Officer through January 13, 2023. | ||
Executive Summary | ||
Our compensation program is based on a pay-for-performance philosophy and is designed to attract and retain qualified talented executives who create compounding and sustainable value to our stockholders through the achievement of the Company's strategy built on three core pillars: Business Systems, Portfolio Management, and Organization Development. 2022 Performance and Results In 2022, we focused on our key initiatives, improved profitability and margin compared to 2021, and we: •generated net sales of $1.4 billion, up 4% compared to the prior year; •increased GAAP and adjusted net income from continuing operations by 9% and 15%, respectively; •increased GAAP and adjusted earnings per share from continuing operations by 14% and 19%, respectively; •acquired a business to expand our Residential Products segment; and •made the decision to exit our processing equipment business in our Agtech segment. The Compensation and Human Capital Committee set 2022 targets at levels that exceeded 2021 actual results. In 2022, the Company improved and exceeded the threshold level of performance for the net sales, adjusted EPS and ROIC performance metrics and did not meet the threshold level of performance for the days working capital metric. | ||
Fiscal Year 2022 Company Performance | ||
| NET SALES | GAAP EPS | ADJUSTED EPS | ||||||||||||||||||
| $1.4B | $2.56 | $3.40 | ||||||||||||||||||
| increased 4% from $1.3B in 2021 | increased 14% from $2.25 in 2021 | increased 22% from $2.78 in 2021 | ||||||||||||||||||
2023 PROXY STATEMENT 29
| COMPENSATION DISCUSSION & ANALYSIS | ||
Executive Compensation Highlights Gibraltar is committed to a philosophy that is heavily weighted toward pay-for-performance. Some of the best practices we employ to achieve this objective include: | ||
| What We Do | What We Don’t Do | |||||||||||||
| Deliver a significant portion of executive compensation in the form of at-risk, performance-based compensation | X | Have single-trigger change-in-control agreements | |||||||||||
| Set performance goals for stock-based incentives on ROIC based in part on consultation with significant stockholders | X | Provide double-trigger change-in-control cash benefits greater than 275% of cash compensation | |||||||||||
| Limit the maximum payout that can be received in our annual cash incentive plan to 200% of target | X | Maintain a supplemental executive retirement plan | |||||||||||
| Reward certain executives with performance-based compensation awards linked to relative total stockholder return | X | Allow our directors and employees to enter into hedging and pledging transactions with Gibraltar stock | |||||||||||
| Require our directors and executive officers to satisfy stock ownership guidelines | X | Provide excise tax gross-ups upon a change in control | |||||||||||
| Engage in a rigorous target-setting process and use multiple performance metrics for the annual cash incentive plan | X | Provide tax gross-ups on executive benefits and perquisites | |||||||||||
| Maintain a Clawback Policy that applies to our named executive officers | X | Grant discounted stock options or, reload or re-price stock options without stockholder approval | |||||||||||
| Reasonable use of executive perquisites | |||||||||||||
| Focus on mitigating undue risk in compensation programs | |||||||||||||
The Compensation and Human Capital Committee believes that the Company’s pay-for-performance philosophy and commitment to compensation programs that encourage the creation of sustainable, long-term stockholder value and alignment of the interests of the named executive officers with those of our stockholders have been successful in encouraging consistent improvement in the Company’s operating results. The summary above, as well as the information contained in this CD&A, reflects the Compensation and Human Capital Committee’s aim to design a compensation program that fairly rewards our executive officers based on performance that is consistent with best practices and in line with pay practices used by our peer group. | ||
Say-on-Pay Vote Results and Response | ||
Based on the results of the Say-on-Pay vote at the 2022 Annual Meeting of Stockholders, in which Gibraltar received 96.1% support from its stockholders, the Compensation and Human Capital Committee concluded that the vast majority of stockholders supported the Company’s compensation programs. The Compensation and Human Capital Committee therefore determined that is was not necessary to make any material changes to our executive compensation program as a result of the Say-on-Pay vote. | ||
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| COMPENSATION DISCUSSION & ANALYSIS | ||
Compensation Philosophy and Pay-for-Performance | ||
The Compensation and Human Capital Committee’s executive pay philosophy is designed to promote alignment of executive pay with stockholder interests and to support Company goals and strategies. Executive compensation programs are designed and managed to promote value creation, to advance overall business objectives, to attract and retain the workforce necessary to ensure the Company’s continued success, and to support Gibraltar’s position as a leading manufacturer and provider of products and services for renewable energy, residential, agtech and infrastructure markets. From time to time, the executive pay philosophy may be adjusted as necessary, to ensure alignment of executive pay with stockholder interests and to support the Company’s goals and strategies. The Compensation and Human Capital Committee focuses the design and delivery of the Company’s compensation programs to achieve the following: •Provide competitive total pay opportunity levels relative to an appropriate group of our peer companies; •Drive high performance by our executive officers through the use of programs that support and reward desired business results; •Provide opportunities for high performing executive officers to achieve above market rewards; •Provide the ability to attract and retain highly qualified executive officers; •Reinforce our commitment to operational excellence, quality, safety, innovation, and to the environment; •Manage current and future programs and risks; and •Provide the flexibility to vary compensation costs through periods of change in our business. We believe our named executive officer’s interests are more directly aligned with the interests of our stockholders when compensation programs are significantly aligned with and impacted by the value of our Common Stock, encourage ownership of our Common Stock, and reward both short and long-term financial performance. The significant elements of our compensation program for executive officers include base salary, the annual Management Incentive Compensation Plan (“MICP”), equity-based incentive compensation under the Long-Term Incentive Plan (“LTIP”), other perquisites, and non-qualified equity-based deferred compensation plan (“2018 MSPP”). | ||
The Compensation and Human Capital Committee believes our LTIP, which includes performance-based and time-based equity awards, furthers the objectives noted above and directly aligns with the interest of our stockholders. Another element of our compensation program, the MICP, provides an annual incentive program to our executives which is based upon the achievement of financial and strategic goals. The Compensation and Human Capital Committee believes the other elements of our compensation program are competitive with the market for our management talent and allow us to attract and retain a highly qualified senior management team. As a result, the compensation programs include a substantial portion of performance-based compensation, including the MICP and performance-based equity awards issued under the LTIP. Consistent with our executive pay philosophy, our CEO’s target compensation is designed to be heavily weighted toward performance-based compensation. During 2022, as depicted in the following chart, 63% of our CEO’s target compensation was provided in the form of performance-based compensation, with an additional 19% attributed to time-vested stock awards. During 2022, on average, 48% of our other NEOs' target compensation was performance-based compensation, with another 11% attributed to time-vested stock awards. The long-term value of time-vested stock awards will fluctuate with our stock price, thus aligning our executive officers’ interests with our stockholders’ interests. | ||
2023 PROXY STATEMENT 31
| COMPENSATION DISCUSSION & ANALYSIS | ||
The following charts highlight the targeted compensation mix for our CEO and the average mix for the other NEOs in 2022: | ||||||||
| CEO 2022 Annual Target Compensation | Other NEOs Average 2022 Annual Target Compensation | |||||||
 | ||||||||
"At Risk" Performance-Based Compensation 63% | "At Risk" Performance-Based Compensation 48% | |||||||
Performance-based compensation consists of annual incentive compensation and performance-based equity awards. A significant portion of the executive officers’ compensation is at-risk based on the value of the Company’s common stock and financial performance. The above charts include targeted compensation generated from the Company match, assuming full allowable amount eligible to be deferred, which is provided for salary and MICP deferrals into our non-qualified deferred compensation plans, and is an important part of our compensation program. Compensation deferred into the 2018 MSPP and any amounts that are matched, are converted to restricted stock units and are also at-risk, since they are based on the value of the Company’s Common Stock. The structure of our non-qualified deferred compensation plans furthers our goal of aligning the interest of our executive officers with the interests of our stockholders as it encourages the deferral of their current compensation for a future payment based on the Company’s future stock price. | ||
The Compensation and Human Capital Committee believes the structure of the MICP incentivizes management to simplify and improve the Company’s operations to generate higher earnings, at a higher rate of return, with a more efficient use of capital. The other significant components of compensation for our executive officers are not at-risk and consist of a competitive base salary and long-term incentive compensation consisting of time-based restricted stock units (“RSUs”). The RSUs convert to shares over a vesting period generally consisting of four years. The Compensation and Human Capital Committee believes the RSU awards align the executive officers’ goals with the interests of our stockholders as the officers are incentivized to adopt a long-term approach to value creation and increase the stock price through ownership of RSUs and shares of the Company’s common stock. We believe time-based equity awards provide a good balance between performance and share ownership which aligns with long term interests of our stockholders while at the same time encouraging continuity of our executive management. | ||
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| COMPENSATION DISCUSSION & ANALYSIS | ||
Distinguishing Awarded Compensation from Realized Compensation | ||
It is important to distinguish the compensation awarded to our named executive officers in 2022, as required to be reported under applicable SEC rules, from the compensation that was actually earned by our named executive officers. Compensation reported within the Summary Compensation Table uses different measurements of the compensation reported depending on the type of compensation. The PSU compensation reported for each executive officer is disclosed at targeted award value, or grant-date fair value, while the compensation from the MICP reported in the table reflects the actual amount earned and paid to the named executive officers, or realized value. If both portions of performance-based compensation were measured at their realized value, it would show the impact of actual performance on each named executive officer’s compensation. The chart and table below show the performance-based and deferred compensation components of total compensation realized by our named executive officers in 2022. •Amounts shown for each "Target" pay column reflect (A) Total Fixed Compensation and (B) Performance-Based Compensation of (i) target annual incentive compensation calculated based upon a percentage of each named executive officer's base salary as of December 31, 2022 at the target MICP payout percentage, (ii) the grant-date fair value of PSU awards that corresponds to the Summary Compensation Table, and (iii) 2018 MSPP matching contributions related to the 2022 annual incentive compensation award at target. •Amounts shown for each "Realized" pay column reflect (A) Total Fixed Compensation and (B) Performance-Based Compensation of (i) annual incentive compensation calculated based upon a percentage of each named executive officers base salary as of December 31, 2022 at the actual MICP payout percentage, (ii) the grant-date fair value of PSU awards multiplied by the actual 2022 PSU payout percentage, and (iii) 2018 MSPP matching contributions related to the 2022 annual incentive compensation award at the (a) actual MICP payout percentage and (b) each named executive officer's deferral election. | ||
As shown below, the realized compensation earned by each Named Executive Officer ranged from 73% to 86% of targeted compensation. Realized compensation was less than target compensation as a result of the Company’s performance in relation to the performance goals set for the MICP and PSU awards. The Compensation and Human Capital Committee believes realized compensation is an important metric to understand when evaluating the effectiveness of the Company’s compensation programs. | ||
| Name | Total Fixed Compensation (1) ($) | Performance Based Compensation | Total Fixed and Performance Based Compensation | Realized Pay as a % of Target (%) | ||||||||||||||||||||||||||||
| MICP | PSUs | Deferred Compensation | ||||||||||||||||||||||||||||||
| Target (2) ($) | Realized (4) ($) | Target (3) ($) | Realized (4) ($) | Target (5) ($) | Realized (5) ($) | Target ($) | Realized ($) | |||||||||||||||||||||||||
| William T. Bosway | 1,959,332 | 990,000 | 683,100 | 1,856,218 | 1,123,012 | 594,000 | 409,860 | 5,399,550 | 4,175,304 | 77% | ||||||||||||||||||||||
| Timothy F. Murphy | 736,840 | 275,586 | 190,154 | 459,284 | 277,867 | 165,352 | 114,093 | 1,637,062 | 1,318,954 | 81% | ||||||||||||||||||||||
| Katherine E. Bolanowski | 503,665 | 129,505 | 89,358 | 148,003 | 89,542 | 77,703 | 53,615 | 858,876 | 736,180 | 86% | ||||||||||||||||||||||
| Jeffrey J. Watorek | 305,820 | 62,500 | 43,125 | 149,977 | 90,736 | 18,750 | 8,625 | 537,047 | 448,306 | 83% | ||||||||||||||||||||||
| Patrick M. Burns | 699,831 | 275,586 | 190,154 | 459,284 | 277,867 | 165,352 | — | 1,600,053 | 1,167,852 | 73% | ||||||||||||||||||||||
| Elizabeth R. Jensen | 521,648 | 151,840 | 104,770 | 265,691 | 160,743 | 91,104 | 20,954 | 1,030,283 | 808,115 | 78% | ||||||||||||||||||||||
(1)Equal to the salary, the granted RSUs included in "Stock Awards," the non-qualified deferred compensation earnings related to Company match on deferred salary under 2018 MSPP, and amounts set forth under "All Other Compensation" in the Summary Compensation Table. (2)Equal to the target annual incentive compensation calculated based upon a percentage of salary as further described below in the "Elements of Our Compensation Program" section. (3)Equal to granted PSUs included in "Stock Awards" in the Summary Compensation Table. (4)Equal to the actual annual incentive compensation earned and the value of PSUs earned based on performance of the Company times the stock price as of March 1, 2022. (5)The deferred compensation (i) target equals the hypothetical units that track the common stock of the Company that would be credited to their non-qualified deferred compensation accounts if each NEO deferred 100% of their MICP at target; and (ii) realized amount equals the value of the hypothetical units that track the common stock of the Company that will be credited to their non-qualified deferred compensation accounts related to their actual 2022 MICP match. | ||
2023 PROXY STATEMENT 33
| COMPENSATION DISCUSSION & ANALYSIS | ||
| CEO | ||
 | ||
| 2022 NEOs (excluding CEO) | ||
 | ||
34
| COMPENSATION DISCUSSION & ANALYSIS | ||
Design of the Compensation Program | ||
The Compensation and Human Capital Committee engaged an independent compensation advisor, Korn Ferry, to provide survey information and assistance in connection with the review and analysis of the compensation program for our executive officers in 2022 to confirm that the emphasis of this program is on performance and long-term incentives and is competitive within our industry in terms of base salaries, annual incentives, and long-term incentives. These three components are the key elements of the compensation program provided to our executive management team. The Company’s compensation program is reviewed annually to ensure that the goals of the program are met and is amended from time to time to incorporate changes consistent with current industry best practices. The compensation program compensates our executive officers through a mix of base salary, annual incentive payments, and long-term equity-based incentives. Peer Company Analysis The relative levels of targeted compensation of our executive officers are determined, in part, by reference to compensation paid to similarly situated executives by a peer group of companies selected by the Compensation and Human Capital Committee along with survey data in consultation with Korn Ferry. The peer group selected by the Compensation and Human Capital Committee consisted of the following companies: | ||
| Aaon, Inc. | Eagle Materials, Inc. | Quanex Building Products Corporation | ||||||
| Albany International Corporation | Griffon Corporation | Simpson Manufacturing Co., Inc. | ||||||
| American Woodmark Corporation | Insteel Industries, Inc. | Trex Company, Inc. | ||||||
| Apogee Enterprises, Inc. | L.B. Foster Company | |||||||
| Armstrong World Industries, Inc. | Masonite International Corporation | |||||||
| Array Technologies, Inc. | PGT Innovations, Inc. | |||||||
The Company made changes to its peer group used to determine compensation in 2023 from the peer group used to determine compensation in 2022 by adding one peer company, Array Technologies, Inc., and by removing three peer companies, A.O. Smith Corporation, Enerpac Tool Group Corporation, and Patrick Industries, Inc. The Compensation and Human Capital Committee believes the chosen peer group aligns with best practices as it provides a sufficient sample size from which we draw conclusions, and reflects a representative market for executive talent that our business faces. The peer companies were selected based on their comparable size, as measured by net sales and market capitalization, and industry. Companies within the selected peer group are businesses supporting the building products, industrial products or renewables industries. Compensation and Human Capital Committee Approval Process Management recommendations for salary increases and participation levels for all other components of our compensation program, for all executive officers other than the CEO, are made annually and are based on the CEO’s evaluation of each executive officer’s performance, length of service to the Company, experience, level of responsibility, the Company’s financial position, and degree to which his or her efforts have contributed to the implementation of the Company’s strategies and goals. This information, along with the information provided by Korn Ferry, is then used by the Compensation and Human Capital Committee to review and establish the compensation of each executive officer. The CEO’s compensation package is determined by the Compensation and Human Capital Committee based upon the same criteria. No executive officer provides input or participates in the deliberation of the Compensation and Human Capital Committee with respect to his or her own compensation. Final authority for the establishment of annual compensation packages of our executive officers resides with the Compensation and Human Capital Committee. Once base salaries and participation levels are established, the formula-driven components of our compensation program are applied to determine the amount of the total compensation which our executive officers will be entitled to receive based upon the degree to which the Company’s annual goals have been achieved. | ||
2023 PROXY STATEMENT 35
| COMPENSATION DISCUSSION & ANALYSIS | ||
Based on the peer group analysis described above along with CEO (other than in the case of the CEO's compensation) and Compensation and Human Capital Committee review, targeted annual incentive compensation and long-term equity-based incentive compensation components of each executive officer’s total compensation were set at percentages of each executive officer’s base salary. This provides the executive officers and stockholders a degree of certainty as to the level of incentive compensation which executive officers will be entitled to receive upon attainment of a specified level of performance. The following table summarizes the targeted level of compensation for annual cash incentive compensation and long-term equity-based incentive awards (including RSUs and PSUs) for each NEO established by the Compensation and Human Capital Committee for 2022: | ||
| Named Executive Officer | Percentage of Salary | |||||||
| Annual Incentive Compensation (MICP) | Long-Term Equity Compensation (LTIP) | |||||||
| William T. Bosway | 120% | 350% | ||||||
| Timothy F. Murphy | 60% | 145% | ||||||
| Katherine E. Bolanowski | 35% | 65% | ||||||
| Jeffrey J. Watorek | 25% | 75% | ||||||
| Patrick M. Burns | 60% | 145% | ||||||
| Elizabeth R. Jensen | 40% | 100% | ||||||
The Compensation and Human Capital Committee set the targeted annual incentive compensation and long-term equity-based incentive compensation levels as a percentage of salary for individual in consultation with Korn Ferry, considering peer group practices, survey data, length of service and role at the Company. The Compensation and Human Capital Committee considers these compensation levels reasonable in comparison to the peer companies described above and tailored to the Company’s leadership structure, level of responsibility, and emphasis on pay-for-performance while also emphasizing stock ownership which the committee believes aligns management’s interests with the interests of our stockholders. Consideration of Risk We believe the design of our executive compensation program provides an appropriate balance of incentives for executives and avoids inappropriate risks. Our compensation program is balanced and focused on the long-term so that our executive officers are incentivized to deliver superior performance over sustained periods. In an effort to promote a focus on the long-term, these compensation plans are designed to allow for deferral of compensation and have elements that are only realizable upon completion of a five-year service requirement under the 2018 MSPP. We believe these plans provide strong incentives to implement policies that promote long-term value creation while avoiding excessive risk-taking in the short-term. Performance goals are established to align with our overall risk framework and reflect a balanced mix of financial measures designed to avoid placing excessive weight on a single measure. Compensation is also balanced among current cash payments, deferred cash, and equity awards. With limited exceptions, the Compensation and Human Capital Committee retains discretion to adjust compensation for quality of performance and adherence to Company values. Additionally, we have policies in place that limit the amount of compensation that can be earned under performance-based incentive programs, require our executive officers to own certain levels of Company stock, prohibit hedging and pledging activities, and include a Clawback Policy for all performance-based compensation. | ||
36
| COMPENSATION DISCUSSION & ANALYSIS | ||
Elements of Our Compensation Program | ||
Our fiscal 2022 compensation program for named executive officers contained the following elements: Base Salary Base salary is annual fixed cash compensation and is the principal non-variable element of the Company's total compensation program. The Compensation and Human Capital Committee reviews and approves base salaries generally at its February meeting with new salaries effective early March of the same year. Base salaries for our named executive officers reflect the level, scope and complexity of the named executive officer's role and responsibility and whether their base salary is appropriately positioned relative to similarly situated executives in our peer group and survey data. Our competitive analysis includes a review of the base salaries paid by our peer group companies to their executive officers and survey data. For fiscal 2022, the Compensation and Human Capital Committee reviewed and approved the base salaries shown below. | ||
| Named Executive Officer | Base Salary (Annualized Rate) | ||||||||||
| Fiscal 2022 | Fiscal 2021 | % Change | |||||||||
| William T. Bosway | $ | 825,000 | $ | 825,000 | —% | ||||||
| Timothy F. Murphy | $ | 459,310 | $ | 450,000 | 2.1% | ||||||
| Katherine E. Bolanowski | $ | 370,013 | n/a | n/a | |||||||
| Jeffrey J. Watorek | $ | 250,000 | $ | 241,000 | 3.7% | ||||||
| Patrick M. Burns | $ | 459,310 | $ | 450,000 | 2.1% | ||||||
| Elizabeth R. Jensen | $ | 379,600 | $ | 365,000 | 4.0% | ||||||
Annual Management Incentive Compensation Plan Our annual Management Incentive Compensation Plan (“MICP”) is designed to provide alignment between executive management’s cash compensation with stockholder interests by rewarding management for achievement of performance targets that the Compensation and Human Capital Committee believes will enhance stockholder value. The performance goals and weightings are reviewed by the Compensation and Human Capital Committee with management on an annual basis and adjusted if deemed appropriate by the Compensation and Human Capital Committee. The Compensation and Human Capital Committee reviews and alters the weightings and the targets to ensure the management team focuses on the key metrics during different periods. Seventy-five percent (75%) of the overall annual MICP payout is based on net sales and adjusted earnings per share ("adjusted EPS"), which are evaluated in a nine-by-nine matrix with a payout between 35% to 200% of target. The 35% payout is earned if both net sales and adjusted EPS meet the threshold levels of achievement, and 200% is earned if both net sales and adjusted EPS meet or exceed the 200% achievement levels. If either actual net sales or actual adjusted EPS is less than the threshold level of achievement, the payout percentage is zero. The remaining twenty-five percent (25%) of the overall annual MICP payout is based on days working capital ("DWC") with a payout between 35% to 200% of target. The 35% payout is earned if the DWC threshold level of achievement is met, and the 200% payout is earned if the actual DWC meets or exceeds the 200% achievement level. If actual DWC is less than the threshold level of achievement, the payout percentage is zero. See the detailed description of net sales, adjusted EPS and DWC in Appendix A. The following graphic illustrates the weighting of the performance goals and the calculation of the financial performance goals of the 2022 annual MICP. | ||
2023 PROXY STATEMENT 37
| COMPENSATION DISCUSSION & ANALYSIS | ||
| Fiscal Year 2022 Design | x | x | + | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 9-by-9 Matrix | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Base Salary ($) | Target Annual Incentive Compensation Percentage (%) | Net Sales | Adjusted EPS | DWC | |||||||||||||||||||||||||||||||||||||||||||||||||
| Weighted 75% | Weighted 25% | ||||||||||||||||||||||||||||||||||||||||||||||||||||
The targets and thresholds for the achievement of annual MICP awards for fiscal year 2022 compared to actual achievement and payout factor are as follows: | ||
| Level of Achievement | Net Sales (in millions) | Adjusted EPS | DWC | |||||||||||||||||||||||
| Threshold | $1,251 | $3.01 | 48.4 | |||||||||||||||||||||||
| 100% Achievement | $1,413 | $3.40 | 43.0 | |||||||||||||||||||||||
| 200% Achievement | $1,590 | $3.83 | 38.0 | |||||||||||||||||||||||
| Actual | $1,390 | $3.40 | 64.6 | |||||||||||||||||||||||
| Payout Factor | 92% | —% | ||||||||||||||||||||||||
| Weighting | 75% | 25% | ||||||||||||||||||||||||
| MICP Payout Percentage | 69% | —% | ||||||||||||||||||||||||
Targeted annual incentive compensation under the annual MICP as a percentage of executive officer base salaries along with the potential payouts at target and actual are as follows: | ||
| Named Executive Officer | Targeted Annual Incentive Compensation as a Percentage of Base Salary | Base Salary | Potential Payout At Target | Actual | ||||||||||||||||
| Payout Percentage | Payout At Actual | |||||||||||||||||||
| William T. Bosway | 120% | $ | 825,000 | $ | 990,000 | 69% | $ | 683,100 | ||||||||||||
| Timothy F. Murphy | 60% | $ | 459,310 | $ | 275,586 | 69% | $ | 190,154 | ||||||||||||
| Katherine E. Bolanowski | 35% | $ | 370,013 | $ | 129,505 | 69% | $ | 89,358 | ||||||||||||
| Jeffrey J. Watorek | 25% | $ | 250,000 | $ | 62,500 | 69% | $ | 43,125 | ||||||||||||
| Patrick M. Burns | 60% | $ | 459,310 | $ | 275,586 | 69% | $ | 190,154 | ||||||||||||
| Elizabeth R. Jensen | 40% | $ | 379,600 | $ | 151,840 | 69% | $ | 104,770 | ||||||||||||
38
| COMPENSATION DISCUSSION & ANALYSIS | ||
The Compensation and Human Capital Committee believes that incentivizing management to deliver improved earnings with a focus on the efficient use of capital will provide stockholders with value as higher profits and lower working capital requirements lead to increased cash flow used to fund growth initiatives of the Company, including acquisitions. In addition, the Compensation and Human Capital Committee believes the combination of the three financial performance targets of Net Sales, Adjusted EPS, and DWC, incentivizes management to maximize the return on investment for our stockholders. The Compensation and Human Capital Committee concluded that the metrics used in the determination of the annual MICP payout are effectively connected to the creation of stockholder value. The Compensation and Human Capital Committee uses adjusted financial information to determine the incentive compensation paid to named executive officers under our performance-based compensation plans in order to keep management motivated to make hard decisions to drive long-term value creation, such as entering into restructuring plans and making acquisitions and divestitures despite the short-term costs associated with these activities. These items normally are not subject to the budgeting process and cannot necessarily be anticipated. Equity-based Incentive Compensation We maintain equity-based incentive compensation plans known as the Gibraltar Industries, Inc. 2015 Equity Incentive Plan and 2018 Equity Incentive Plan (the “Omnibus Plans”). Our Omnibus Plans are an integral component of our overall compensation structure and provide the Company the vehicles through which we make awards of equity-based compensation to our named executive officers and other management employees. | ||
Long-Term Incentive Plan The Compensation and Human Capital Committee has provided for grants of equity-based awards to our named executive officers each year under the Long-Term Incentive Plan (“LTIP”). The Compensation and Human Capital Committee grants long-term equity-based awards with a target value, at the time the award is made, equal to a percentage of the executive officer’s base salary. Equity awards consist of time-vested grants of restricted stock units (“RSUs”) and performance-based grants of performance stock units (“PSUs”). Targeted annual incentive compensation under RSU and PSU awards as a percentage of executive officer base salaries during 2022 are as follows: | ||
| Named Executive Officer | Target Annual Incentive Compensation of 2022 RSUs | Annual RSU Grants as a Percentage of Base Salary | Target Annual Incentive Compensation of 2022 PSUs | Annual PSU Grants as a Percentage of Base Salary | ||||||||||
| William T. Bosway | $ | 1,031,250 | 125% | $ | 1,856,250 | 225% | ||||||||
| Timothy F. Murphy | $ | 206,690 | 45% | $ | 459,310 | 100% | ||||||||
| Katherine E. Bolanowski | $ | 92,503 | 25% | $ | 148,005 | 40% | ||||||||
| Jeffrey J. Watorek | $ | 37,500 | 15% | $ | 150,000 | 60% | ||||||||
| Patrick M. Burns | $ | 206,690 | 45% | $ | 459,310 | 100% | ||||||||
| Elizabeth R. Jensen | $ | 113,880 | 30% | $ | 265,720 | 70% | ||||||||
Restricted Stock Units Under the terms of RSU awards, vesting occurs in equal installments over a four (4) year period commencing on the first anniversary of the grant date. The vesting conditions which apply to RSUs granted to the executive officers under the Company’s LTIP are designed to reward executives for continuing their employment with the Company and for implementing policies and practices which increase the value of the Company’s Common Stock over a significant period of time. Performance Stock Units Under the terms of PSU awards, achievement is determined based on ROIC (as defined in the award) in the year of issuance and cliff-vest three years from date of grant. The number of PSUs earned were determined during the 2022 performance period based upon the Company’s ROIC compared to the targeted ROIC. The Compensation and Human Capital Committee has selected ROIC as the performance goal used in determining payouts under PSU awards based on stockholder feedback and management’s recommendation. | ||
2023 PROXY STATEMENT 39
| COMPENSATION DISCUSSION & ANALYSIS | ||
ROIC is an important metric to be considered when making investment decisions and a focus on ROIC will incentivize management to make careful considerations when allocating capital for equipment, innovative growth opportunities, acquisitions, and other growth initiatives. The Company is actively focusing on portfolio management and has significant capital resources to utilize in acquisitions to expand its position and shape its markets, and as a result, we believe it is challenging to forecast for periods longer than one year. The ROIC metric is a broad measurement of performance that measures profitability, cash flow generation, and asset management, which the Compensation and Human Capital Committee believes is a measure that is indicative of the effectiveness of our executive management team. The Compensation and Human Capital Committee believes that incorporating ROIC as a component of our compensation program closely aligns executive officer compensation with the interests of the Company's stockholders and the three-year vesting period incentivizes long-term value creation and promotes retention of the Company's executive management team. Targeted ROIC is determined based upon the budget presented to the Board of Directors by the executive management team. The Compensation and Human Capital Committee approved the 2022 target of 13.5% based on the budgeted financial information presented. The threshold to earn any PSUs under the award was set at 11.5%. The maximum number of shares earned is limited to 200%, which would have required a ROIC of 15.5% or higher to achieve. | ||
In 2022, the named executive officers earned 60.5% of the targeted PSUs awarded as the actual ROIC, as calculated in Appendix A, was below the target threshold set by the Compensation and Human Capital Committee. The following table calculates the number of PSU awards issued and earned during 2022: | ||
| William T. Bosway | Timothy F. Murphy | Katherine E. Bolanowski | Jeffrey J. Watorek | Patrick M. Burns | Elizabeth R. Jensen | |||||||||||||||
| Salary as of grant date | $ | 825,000 | $ | 459,310 | $ | 370,013 | $ | 250,000 | $ | 459,310 | $ | 379,600 | ||||||||
| PSU grant as a percentage of salary | 225 | % | 100 | % | 40 | % | 60 | % | 100 | % | 70 | % | ||||||||
| Target compensation from PSU awards | $ | 1,856,250 | $ | 459,310 | $ | 148,005 | $ | 150,000 | $ | 459,310 | $ | 265,720 | ||||||||
| Stock price as of grant date | $ | 47.00 | $ | 47.00 | $ | 47.00 | $ | 47.00 | $ | 47.00 | $ | 47.00 | ||||||||
| PSUs awarded during 2022 | 39,494 | 9,772 | 3,149 | 3,191 | 9,772 | 5,653 | ||||||||||||||
| Percentage of PSUs earned | 60.50 | % | 60.50 | % | 60.50 | % | 60.50 | % | 60.50 | % | 60.50 | % | ||||||||
| PSUs earned during 2022 | 23,894 | 5,912 | 1,905 | 1,931 | 5,912 | 3,420 | ||||||||||||||
Non-qualified Deferred Compensation Plan A feature of our 2018 Equity Incentive Plan, as described above, is the 2018 Management Stock Purchase Plan (“2018 MSPP”), a non-qualified deferred compensation arrangement, which allows our executive officers to defer receipt of up to 25% of their base salary and up to 100% of their bonus (i.e., annual incentive compensation earned under the MICP). The Compensation and Human Capital Committee approved the establishment of the 2018 MSPP in order to attract, retain and motivate executive officers and a select group of management employees. Under the 2018 MSPP, if an executive officer elects to defer receipt of a portion of his or her base salary or bonus, the dollar amount deferred is credited to a deferral account (“Deferral Account”). The base salary and bonus amounts deferred are able to achieve an investment return based on the hypothetical investment of such amounts among investment alternatives selected by the executive officer, which are substantially similar to the investment alternatives available to participants in the Company’s 401(k) Plan and include hypothetical units that track the common stock of the Company (“Deferral Units”). Each executive officer’s Deferral Account will reflect the amounts of base salary and bonus deferred by the executive officer, along with any earnings or losses that would have been realized on those amounts had they been invested in the investment alternatives chosen by the executive officer. | ||
40
| COMPENSATION DISCUSSION & ANALYSIS | ||
If the executive officer chooses Deferral Units (i.e., the hypothetical units that track the Company’s common stock) as the investment alternative, the value of such officer’s Deferral Account will be determined by the number of Deferral Units credited to the Deferral Account based on the amounts of base salary and bonus deferred by the executive officer, multiplied by the value of the Company’s common stock (which is calculated in accordance with the 2018 MSPP). The Company will match up to 40% of the base salary amount deferred by executive officers and will match 80% up to the first 50% of the bonus amount deferred and 40% of the excess bonus amount deferred. The dollar amount of the match is credited to a deferred matching account ("Matching Account") with the corresponding number of hypothetical units that track the common stock of the Company (“Matching Units”) determined in accordance with the 2018 MSPP. Payments of the amounts in an executive officer’s Deferral Account, including the base salary and bonus deferred and the investment return that would have been realized had such amounts been invested in the investment alternatives selected by the executive officer, including the value of any Deferral Units, are made in cash to the executive officer upon a termination of employment. The value of the executive officer’s Matching Account is also paid in cash to the executive officer if the executive officer's employment is terminated after the fifth anniversary of the executive officer's vesting commencement date, or if the executive officer’s employment is terminated by the Company without "cause," by the executive officer for "good reason," or due to death or disability, before the executive officer reaches the fifth anniversary of the executive officer's vesting commencement date. The Matching Units are forfeited if the executive officer’s employment is terminated, for any reason other than a change in control transaction, termination by the Company without cause, a resignation for good reason, and death or disability, before the executive officer reaches the fifth anniversary of the executive officer's vesting commencement date. Prior to the deferral, the executive officer elects whether to receive payment of the amounts determined above in either (a) a lump sum, (b) five substantially equal annual installments, or (c) ten substantially equal annual installments, in each case, beginning six months after the date of termination. During the period that the installment payments are being made, the undistributed value of the executive officer’s account will earn interest at a rate equal to the average annualized rate of interest payable on ten-year US Treasury Notes plus 2%. We believe the 2018 MSPP furthers our compensation objectives of aligning the interests of our executive officers with stockholder interests by providing the executive officers an opportunity to increase post-termination compensation as a result of increases in the value of the Company’s common stock over their careers. | ||
The following table summarizes the amount each NEO deferred into the 2018 MSPP, the number of Deferral Units credited to their 2018 MSPP accounts, and the Matching Units credited to their 2018 MSPP accounts during 2022: | ||
| Named Executive Officer | Deferred Compensation ($) | Deferral Units and Matching Units Credited to 2018 MSPP | |||||||||
| Officer Deferrals (#) | Company Match (#) | ||||||||||
| William T. Bosway | $ | 206,250 | — | 1,823 | |||||||
| Timothy F. Murphy | $ | 114,416 | 2,530 | 1,012 | |||||||
| Katherine E. Bolanowski | $ | 91,950 | — | 814 | |||||||
| Jeffrey J. Watorek | $ | 24,841 | — | 110 | |||||||
| Patrick M. Burns | $ | — | — | — | |||||||
| Elizabeth R. Jensen | $ | 37,702 | 834 | 334 | |||||||
Retirement Plans Our executive officers are entitled to participate in our Gibraltar 401(k) Plan. The Company provides a 100% match of the first three-percent of compensation deferred, and 50% match on the next two-percent of compensation deferred. Participants are fully vested in all Company matching contributions. The Company does not provide any other retirement benefits aside from the 401(k) Plan. | ||
2023 PROXY STATEMENT 41
| COMPENSATION DISCUSSION & ANALYSIS | ||
Perquisites and Other Benefits We annually review the perquisites that executive officers receive. The perquisites offered to our executive officers in 2022 include personal use of Company automobiles, health-care benefits, and tax planning services. Change in Control Benefits Our executive officers have been a key component in building our Company into the successful enterprise that it is today. We believe that it is important to protect our executive officers in the context of a change in control transaction to allow them to focus on the transaction. Further, it is our belief that the interests of our stockholders will be best served if the interests of our executive officers are aligned with the long-term success of the Company. We believe that change in control benefits should eliminate, or at least reduce, the reluctance of our executive officers to vigorously negotiate the optimal financial terms for our stockholders in the event of any potential, future change in control transactions. As a result, the Company has entered into Change in Control agreements with each of Mr. Bosway and Mr. Murphy. Our Change in Control benefits for Mr. Bosway and Mr. Murphy provide for the protection of previously granted equity-based incentive compensation and provide for a cash payment upon a double trigger event, which would be the consummation of the Change in Control transaction and subsequent termination of employment. For more information concerning amounts our executive officers are entitled to receive upon a termination of employment and change in control, see “Potential Payments Upon Termination or Change in Control” below. Generally Available Benefit Programs The executive officers also participate in the Company’s other generally available benefit plans on the same terms as other employees at the Company’s headquarters. These plans include vacation, medical and dental insurance, life insurance, a supplemental salary continuation plan providing supplemental short-term disability benefits. | ||
Long-Term Incentive Compensation Grant Practices | ||
Executive equity awards are approved at regularly scheduled Compensation and Human Capital Committee meetings, at the time of an executive hire or promotion or upon identification of a specific retention concern. The grant date of equity awards approved by the Compensation and Human Capital Committee is either the date of Committee approval or a date subsequent to the approval date as specified by the Compensation and Human Capital Committee. The timing of equity awards has not been coordinated with the release of material non-public information. The Compensation and Human Capital Committee’s general practice is to approve annual equity awards to executives at the Compensation and Human Capital Committee’s regularly scheduled meeting in February, when the Committee reviews the performance of the executive officers and typically determines the other components of executive compensation. The target dollar value attributable to PSUs and RSUs, as applicable, has been translated into a target number of PSUs or RSUs, as applicable, using the closing price of the Company’s Common Stock on the date of grant (or on the immediately preceding trading day if the date of grant is not a trading day). | ||
Clawback Policy | ||
The Company has a Clawback Policy which requires recoupment of an executive officer’s performance-based compensation if the independent members of the Board determine that the executive engaged in fraudulent conduct that resulted in a restatement of financial statements filed with the Securities and Exchange Commission. We expect to revise our Executive Clawback Policy in the next 12 months to comply with the listing rules to be adopted by NASDAQ as a result of recent SEC rulemaking. This policy is contained in our Corporate Governance Guidelines, which are available on our website at www.gibraltar1.com. | ||
42
| COMPENSATION DISCUSSION & ANALYSIS | ||
Executive Stock Ownership Guideline | ||
In accordance with the Company's Stock Ownership Policy, the Chief Executive Officer is required to hold 500% of his or her base salary in shares of the Company's common stock or other permitted equity interest within five years following his or her appointment. Also in accordance with this policy, the Chief Operating Officer, Chief Financial Officer, Senior Vice President and Vice Presidents are required to hold 300%, 300%, 100% and 50% of their base salary, respectively, in shares of the Company's common stock or other permitted equity interest within three years following their appointment. For purposes of determining value of shares held, shares include common stock owned by the officer and those owned by spouse and/or minor children. Performance stock units and restricted stock units settled in the Company's common stock are considered equity interest for this purpose. The value of shares held is determined based on current fair market value and in the case of options, based on the difference between the exercise price and fair market value per share. This policy is available on our website at www.gibraltar1.com. | ||
Hedging and Pledging Company Securities Policy | ||
Under our insider trading policy, the Company has adopted a policy that prohibits any director or executive officer from engaging in hedging transactions related to, or from pledging or creating a security interest in the Company's Common Stock that the director or officer directly or indirectly owns and controls. No director or executive officer has hedged or pledged any shares of the Company's Common Stock. This policy is contained in our Corporate Governance Guidelines, which are available on our website at www.gibraltar1.com. | ||
Tax Considerations | ||
Section 162(m) of the Internal Revenue Code of 1986, as amended, precludes the deductibility of a current and former named executive officer’s compensation that exceeds $1,000,000 per year. Although the Compensation and Human Capital Committee has historically attempted to structure executive compensation to preserve deductibility, it also reserves the right to provide compensation that may not be fully deductible in order to maintain flexibility in compensating named executive officers in a manner consistent with our compensation philosophy, as deemed appropriate. The Compensation and Human Capital Committee believes that stockholder interests are best served by not restricting the Compensation and Human Capital Committee’s discretion in this regard, even though such compensation may result in non-deductible compensation expenses to the Company. The Section 162(m) limitation resulted in a disallowed tax deduction for compensation expense of $3,940,608 in 2022. Additionally, Section 409A of the Internal Revenue Code generally imposes a tax on non-qualified deferred compensation arrangements which do not meet guidelines established by regulations under the Internal Revenue Code. The Company’s non-qualified deferred compensation arrangements are intended to comply with Section 409A. If a company makes "parachute payments," Section 280G of the Code prohibits the company from deducting the portion of the parachute payments constituting "excess parachute payments" and Section 4999 of the Code imposes on a "disqualified individual" a 20% excise tax on the excess parachute payments. For this purpose, parachute payments generally are defined as payments to disqualified individuals that are contingent upon a change in control in an amount equal to or greater than three times the disqualified individual’s base amount (in general, the five-year average Form W-2 compensation). The excess parachute payments, which are nondeductible and subject to a 20% excise tax, equal the portion of the parachute payments that exceeds one time the disqualified individual’s base amount. The Change in Control Agreements and the Company’s equity incentive plans may entitle participants to receive payments in connection with a change in control that may result in excess parachute payments. The Company does not pay any tax gross-ups with respect to the excise tax imposed on any person who receives excess parachute payments. | ||
2023 PROXY STATEMENT 43
COMPENSATION AND HUMAN CAPITAL COMMITTEE REPORT The Compensation and Human Capital Committee has reviewed and discussed the contents of the above Compensation Discussion and Analysis section of this Proxy Statement with management. Based on such review and discussion, the Compensation and Human Capital Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference in the Company’s annual report on Form 10-K filed February 22, 2023. | ||
| COMPENSATION AND HUMAN CAPITAL COMMITTEE OF THE BOARD OF DIRECTORS OF GIBRALTAR INDUSTRIES, INC. | |||||
| Craig A. Hindman (Chair) | |||||
| Gwendolyn G. Mizell | |||||
| Linda K. Myers | |||||
| Atlee Valentine Pope | |||||
44
COMPENSATION OF EXECUTIVE OFFICERS | ||
Summary Compensation Table for 2022 | |||||||||||||||||||||||
| Name and Principal Position | Year | Salary (4) ($) | Stock Awards (5) ($) | Non-Equity Incentive Plan Compensation (6) ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings (7) ($) | All Other Compensation (8) ($) | Total ($) | ||||||||||||||||
William T. Bosway Chairman of the Board, President and Chief Executive Officer | 2022 | 825,000 | 2,887,445 | 683,100 | 82,500 | 20,605 | 4,498,650 | ||||||||||||||||
| 2021 | 803,365 | 2,887,488 | — | 301,455 | 23,078 | 4,015,386 | |||||||||||||||||
| 2020 | 700,000 | 2,769,105 | 502,425 | 483,546 | 23,242 | 4,478,318 | |||||||||||||||||
Timothy F. Murphy Senior Vice President and Chief Financial Officer | 2022 | 457,663 | 665,943 | 190,154 | 45,766 | 26,752 | 1,386,278 | ||||||||||||||||
| 2021 | 446,539 | 652,525 | — | 145,661 | 27,398 | 1,272,123 | |||||||||||||||||
| 2020 | 421,000 | 1,125,323 | 168,345 | 213,848 | 28,229 | 1,956,745 | |||||||||||||||||
Katherine E. Bolanowski (1) General Counsel, Vice President and Secretary | 2022 | 367,799 | 240,499 | 89,358 | 36,780 | 6,590 | 741,026 | ||||||||||||||||
Jeffrey J. Watorek Vice President and Treasurer | 2022 | 248,408 | 187,436 | 43,125 | 4,968 | 14,986 | 498,923 | ||||||||||||||||
| 2021 | 239,442 | 209,231 | — | 9,963 | 24,316 | 482,952 | |||||||||||||||||
| 2020 | 226,000 | 162,423 | 37,845 | 6,399 | 24,425 | 457,092 | |||||||||||||||||
Patrick M. Burns (2) Former Chief Operating Officer | 2022 | 457,663 | 665,943 | 190,154 | — | 35,509 | 1,349,269 | ||||||||||||||||
| 2021 | 446,539 | 652,525 | — | 111,992 | 45,155 | 1,256,211 | |||||||||||||||||
| 2020 | 421,000 | 1,125,323 | 168,345 | 160,294 | 33,736 | 1,908,698 | |||||||||||||||||
Elizabeth R. Jensen (3) Former Vice President and Chief Human Resources Officer | 2022 | 377,017 | 379,525 | 104,770 | 15,081 | 15,716 | 892,109 | ||||||||||||||||
| 2021 | 294,808 | 346,730 | — | 11,792 | 167,216 | 820,546 | |||||||||||||||||
(1)Bolanowski was appointed as General Counsel, Vice President and Secretary effective February 22, 2022. (2)Burns served as Chief Operating Officer through December 30, 2022. (3)Jensen was hired and appointed as Vice President and Chief Human Resources Officer effective March 8, 2021 and served in that position through January 13, 2023. (4)This column may vary from the amounts disclosed in the CD&A on page 37 as a result of the timing of the salary increase during 2022 for Murphy, Bolanowski, Watorek, Burns and Jensen. This column includes salary amounts deferred at the direction of the NEO to the 2018 MSPP, a non-qualified deferred compensation plan, for an equal amount in the grant of Deferral Units. The deferred salary amounts, which are equal to the grant date fair values, are as follows: Bosway $206,250; Murphy $114,416; Bolanowski $91,950; Watorek $24,841; and Jensen $37,702. Further information regarding the grant date fair value credited to the NEOs and the corresponding Deferral Units that track the common stock of the Company can be found in the Grants of Plan-Based Awards Table and Non-qualified Deferred Compensation Table. (5)This column represents: (a) the grant date fair value of time-vested restricted stock units granted that year under the 2018 Equity Incentive Plan. Fair value was calculated using the closing price of Gibraltar Industries, Inc. common stock on the date of grant. The grant date fair value for the 2022 RSUs issued under the annual LTIP program in 2022 are as follows: Bosway $1,031,227; Murphy $206,659; Bolanowski $92,496; Watorek $37,459; Burns $206,659; and Jensen $113,834; and (b) the grant date fair value of PSUs granted during that year under the 2018 Equity Incentive Plan. For the 2022 PSUs the assumptions applicable to these valuations can be found in Note 12 of the Notes to Consolidated Financial Statements - Equity-Based Compensation contained in the Gibraltar Industries, Inc. Annual Report on Form 10-K for the year ended December 31, 2022. ROIC is considered a performance condition and the grant date fair value used in this table for the 2022 PSUs corresponds with management's expectation of the probable outcome of the performance condition as of the grant date. The grant date fair value for the 2022 PSUs issued under the annual LTIP program in 2022 are as follows: Bosway $1,856,21; Murphy $459,284; Bolanowski $148,003; Watorek $149,977; Burns $459,284: and Jensen $265,691. The maximum grant date fair value for the 2022 PSUs are as follows: Bosway $3,712,436; Murphy $918,568; Bolanowski $296,006; Watorek, $299,954; Burns, $918,568; and Jensen $531,382. The actual number of units earned under 2022 PSUs differed based on the performance of the Company as measured by its actual 2022 ROIC compared to targeted ROIC. Further information regarding these awards can be found above in the CD&A on pages 40 and 41. As a result, the actual compensation that will be earned under these PSU awards may vary significantly from the grant date fair value disclosed. | ||
2023 PROXY STATEMENT 45
| COMPENSATION OF EXECUTIVE OFFICERS | ||
(6)This column represents the amounts earned under the Management Incentive Compensation Plan for the respective years. The amounts earned for Bosway, Murphy and Bolanowski for 2022 are payable in 2023 but will be deferred and credited to their 2018 MSPP Deferral Accounts respectively at the election of Bosway, Murphy and Bolanowski. The amounts earned for Watorek, Burns and Jensen for 2022 are payable in 2023 but 50%, 50% and 25% will be deferred and credited to their 2018 MSPP Deferral Accounts, respectively, at the election of Watorek, Burns and Jensen. (7)This column represents the Company matching contributions to the 2018 MSPP, a non-qualified deferred compensation plan. Further information regarding the grant date fair value and the corresponding number of Matching Units credited to the NEOs can be found in the Grants of Plan-Based Awards Table and Non-qualified Deferred Compensation Table. (8)This column represents the following 2022 other compensation: | ||
| Name | 401(k) Match ($) | Health Reimbursement Account ($) | Personal Use of Company Autos ($) | Tax Planning ($) | Total ($) | |||||||||||||||
| William T. Bosway | 11,440 | 5,405 | 2,400 | 1,360 | 20,605 | |||||||||||||||
| Timothy F. Murphy | 12,200 | 10,985 | 3,567 | — | 26,752 | |||||||||||||||
| Katherine E. Bolanowski | 5,468 | 1,122 | — | — | 6,590 | |||||||||||||||
| Jeffrey J. Watorek | 8,943 | 1,665 | 4,378 | — | 14,986 | |||||||||||||||
| Patrick M. Burns | 12,200 | 9,980 | 8,329 | 5,000 | 35,509 | |||||||||||||||
| Elizabeth R. Jensen | 12,079 | 3,077 | — | 560 | 15,716 | |||||||||||||||
46
| COMPENSATION OF EXECUTIVE OFFICERS | ||
Grants of Plan-Based Awards in 2022 | |||||||||||||||||||||||||||||
| Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Other Stock Awards: Number of Shares of Stock Or Units (#) | Grant Date Fair Value of Stock and Option Awards (S) | ||||||||||||||||||||||||
| Threshold ($) | Target ($) | Maximum ($) | Threshold (5) (#) | Target (#) | Maximum (#) | ||||||||||||||||||||||||
| William T. Bosway | (1) | 346,500 | 990,000 | 1,980,000 | — | — | — | — | — | ||||||||||||||||||||
| 3/1/2022 (2) | — | — | — | — | — | — | 21,941 | 1,031,227 | |||||||||||||||||||||
| 3/1/2022 (3) | — | — | — | — | 39,494 | 78,988 | — | 1,856,218 | |||||||||||||||||||||
| 3/31/2022 (4) | — | — | — | — | — | — | 361 | 19,038 | |||||||||||||||||||||
| 6/30/2022 (4) | — | — | — | — | — | — | 544 | 22,211 | |||||||||||||||||||||
| 9/30/2022 (4) | — | — | — | — | — | — | 521 | 22,212 | |||||||||||||||||||||
| 12/31/2022 (4) | — | — | — | — | — | — | 397 | 19,039 | |||||||||||||||||||||
| Timothy F. Murphy | (1) | 96,455 | 275,586 | 551,172 | — | — | — | — | — | ||||||||||||||||||||
| 3/1/2022 (2) | — | — | — | — | — | — | 4,397 | 206,659 | |||||||||||||||||||||
| 3/1/2022 (3) | — | — | — | — | 9,772 | 19,544 | — | 459,284 | |||||||||||||||||||||
| 3/31/2022 (4) | — | — | — | — | — | — | 693 | 36,522 | |||||||||||||||||||||
| 6/30/2022 (4) | — | — | — | — | — | — | 1,061 | 43,281 | |||||||||||||||||||||
| 9/30/2022 (4) | — | — | — | — | — | — | 1,015 | 43,281 | |||||||||||||||||||||
| 12/31/2022 (4) | — | — | — | — | — | — | 773 | 37,099 | |||||||||||||||||||||
| Katherine E. Bolanowski | (1) | 45,327 | 129,505 | 259,010 | — | — | — | — | — | ||||||||||||||||||||
| 3/1/2022 (2) | — | — | — | — | — | — | 1,968 | 92,496 | |||||||||||||||||||||
| 3/1/2022 (3) | — | — | — | — | 3,149 | 6,298 | — | 148,003 | |||||||||||||||||||||
| 3/31/2022 (4) | — | — | — | — | — | — | 158 | 8,317 | |||||||||||||||||||||
| 6/30/2022 (4) | — | — | — | — | — | — | 244 | 9,962 | |||||||||||||||||||||
| 9/30/2022 (4) | — | — | — | — | — | — | 234 | 9,962 | |||||||||||||||||||||
| 12/31/2022 (4) | — | — | — | — | — | — | 178 | 8,539 | |||||||||||||||||||||
| Jeffrey J. Watorek | (1) | 21,875 | 62,500 | 125,000 | — | — | — | — | — | ||||||||||||||||||||
| 3/1/2022 (2) | — | — | — | — | — | — | 797 | 37,459 | |||||||||||||||||||||
| 3/1/2022 (3) | — | — | — | — | 3,191 | 6,382 | — | 149,977 | |||||||||||||||||||||
| 3/31/2022 (4) | — | — | — | — | — | — | 21 | 1,122 | |||||||||||||||||||||
| 6/30/2022 (4) | — | — | — | — | — | — | 33 | 1,346 | |||||||||||||||||||||
| 9/30/2022 (4) | — | — | — | — | — | — | 32 | 1,346 | |||||||||||||||||||||
| 12/31/2022 (4) | — | — | — | — | — | — | 24 | 1,154 | |||||||||||||||||||||
| Patrick M. Burns | (1) | 96,455 | 275,586 | 551,172 | — | — | — | — | — | ||||||||||||||||||||
| 3/1/2022 (2) | — | — | — | — | — | — | 4,397 | 206,659 | |||||||||||||||||||||
| 3/1/2022 (3) | — | — | — | — | 9,772 | 19,544 | — | 459,284 | |||||||||||||||||||||
| Elizabeth R. Jensen | (1) | 46,501 | 132,860 | 265,720 | — | — | — | — | — | ||||||||||||||||||||
| 3/1/2022 (2) | — | — | — | — | — | — | 2,422 | 113,834 | |||||||||||||||||||||
| 3/1/2022 (3) | — | — | — | — | 5,653 | 11,306 | — | 265,691 | |||||||||||||||||||||
| 3/31/2022 (4) | — | — | — | — | — | — | 226 | 11,903 | |||||||||||||||||||||
| 6/30/2022 (4) | — | — | — | — | — | — | 351 | 14,308 | |||||||||||||||||||||
| 9/30/2022 (4) | — | — | — | — | — | — | 335 | 14,308 | |||||||||||||||||||||
| 12/31/2022 (4) | — | — | — | — | — | — | 256 | 12,264 | |||||||||||||||||||||
(1)Estimated future payouts represent the amount that was payable under the annual Management Incentive Compensation Plan (“MICP”) for performance in 2022. The maximum payment under this plan is limited to 200% of target. (2)Consists of restricted stock units issued under the Company’s 2018 Equity Incentive Plan that convert to shares upon vesting. (3)Consists of performance stock units issued under the Company’s 2018 Equity Incentive Plan that convert to shares upon vesting. (4)Consists of Deferral Units (i.e., the hypothetical units that track the Company's common stock) and Matching Units issued under the 2018 MSPP. Deferral Units issued in 2022 of 2,530 units and 834 units issued to Murphy and Jensen, | ||
2023 PROXY STATEMENT 47
| COMPENSATION OF EXECUTIVE OFFICERS | ||
respectively, represent units purchased through deferral of salary; and 1,823 units, 1,012 units, 814 units, 110 units, and 334 units issued to Bosway, Murphy, Bolanowski, Watorek, and Jensen, respectively, represent the Company’s Matching Units. The Matching Units are credited to executive officer’s Matching Account upon vesting, which occurs upon fifth anniversary of the executive officer’s vesting commencement date. If employment is voluntarily terminated or terminated with cause prior to attaining the fifth anniversary of the executive officer’s participation commencement, matching units are forfeited. Upon termination of employment the balance in the hypothetical investment account is paid out as either a lump sum, or over five years, or over ten years. (5)There is no threshold payout for reaching the minimum ROIC. | ||
| The following table sets forth information concerning unexercised options, stock awards that have not vested, and equity incentive plan awards for each NEO that were outstanding at the end of 2022. | ||||||||||||||||||||||||||
Outstanding Equity Awards at Fiscal Year End | ||||||||||||||||||||||||||
| Name | Grant Date | Options Awards | Stock Awards | |||||||||||||||||||||||
| Number of Securities Underlying Unexercised Options Exercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock that Have Not Vested (#) (1) | Market Value of Shares or Units of Stock that Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested (#) (2) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested ($) | ||||||||||||||||||||
| William T. Bosway | 3/1/2019 (1) | — | — | —&# | ||||||||||||||||||||||