SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of
1934 (Amendment No. ____)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
Gibraltar Steel Corporation
(Name of Registrant as specified in its charter)
___________________________
(Name of person(s) filing Proxy Statement, if other than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11
(1)Title of each class of securities to which transaction applies:
___________________
(2)Aggregate number of securities to which transaction applies:
___________________
(3)Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: ________________
(4)Proposed maximum aggregate value of transaction: __________________
(5)Total fee paid: ___________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided
by Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
(1)Amount Previously Paid: ______________________
(2)Form, Schedule or Registration Statement No.: ___________________
(3)Filing Party: ___________________
(4)Date Filed: ____________________
<PAGE>
GIBRALTAR STEEL CORPORATION
3556 Lake Shore Road
P.O. Box 2028
Buffalo, New York 14219-0228
____________________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD May 19, 1998
____________________________________________________
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Gibraltar
Steel Corporation, a Delaware corporation (the "Company"), will be held at
the Company's offices, 3556 Lake Shore Road, Buffalo, New York, on May 19,
1998, at 10:00 a.m., local time, for the following purposes:
1. To elect two Class II Directors to hold office until the 2001 Annual
Meeting and until their successors have been elected and qualified.
2. To consider and take action upon the proposed Third Amendment and
Restatement of the Gibraltar Steel Corporation Incentive Stock Option Plan.
3. To take action upon and transact such other business as may be properly
brought before the meeting or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on March 23, 1998,
as the record date for the determination of stockholders entitled to receive
notice of and to vote at the Annual Meeting.
Stockholders who do not expect to attend the meeting in person are urged
to vote, sign and date the enclosed proxy and return it promptly in the
envelope enclosed for that purpose.
WALTER T. ERAZMUS
Secretary
Dated: April __, 1998
<PAGE>
GIBRALTAR STEEL CORPORATION
3556 Lake Shore Road
P.O. Box 2028
Buffalo, New York 14219-0228
_________________________________________________
PROXY STATEMENT
_________________________________________________
This Proxy Statement and the accompanying form of proxy are
being furnished in connection with the solicitation, by the Board
of Directors of Gibraltar Steel Corporation, a Delaware
corporation (the "Company"), of proxies to be voted at the Annual
Meeting of Stockholders to be held at the Company's offices, 3556
Lake Shore Road, Buffalo, New York, on May 19, 1998, at 10:00
a.m., local time, and at any adjournment or adjournments thereof.
The close of business on March 23, 1998, has been fixed as the
record date for the determination of stockholders entitled to
receive notice of and to vote at the meeting. At the close of
business on March 23, 1998, the Company had outstanding
____________ shares of common stock, $.01 par value per share
("Common Stock"), the holders of which are entitled to one vote
per share on each matter properly brought before the Annual
Meeting.
The cost of solicitation of proxies in the accompanying form
will be borne by the Company, including expenses in connection
with preparing and mailing this Proxy Statement. In addition to
the use of the mails, proxies may be solicited by personal
interviews and telephone by Directors, officers and employees of
the Company. Arrangements will be made with brokerage houses,
banks and other custodians, nominees and fiduciaries for the
forwarding of solicitation material to the beneficial owners of
Common Stock, and the Company will reimburse them for reasonable
out-of-pocket expenses incurred by them in connection therewith.
The shares represented by all valid proxies in the enclosed
form will be voted if received in time for the Annual Meeting in
accordance with the specifications, if any, made on the proxy
card. If no specification is made, the proxies will be voted FOR
the nominees for Director named in this Proxy Statement and FOR
the approval of the adoption of the Third Amendment and
Restatement of the Gibraltar Steel Corporation Incentive Stock
Option Plan as described in this Proxy Statement.
The proxy card provides space for a stockholder to withhold
voting for any or all nominees for the Board of Directors or to
abstain from voting for any proposal if the stockholder chooses
to do so. Each nominee for election as a Director requires a
plurality of the votes cast in order to be elected. A plurality
means that the nominees with the largest number of votes are
elected as Directors up to the maximum number of Directors to be
elected at the Annual Meeting. Each other proposal submitted to
the stockholders requires the affirmative vote of the holders of
a majority of the votes present at the meeting, in person or by
proxy, and entitled to vote. With respect to the election of
Directors, only shares that are voted in favor of a particular
nominee will be counted towards achievement of a plurality; where
a stockholder properly withholds authority to vote for a
particular nominee, such shares will not be counted towards such
nominee's or any other nominee's achievement of plurality. With
respect to the other proposals to be voted upon: (i) if a
stockholder abstains from voting on a proposal, such shares are
considered present at the meeting for such proposal but, since
they are not affirmative votes for the proposal, they will have
the same effect as votes against the proposal; and (ii) shares
registered in the names of brokers or other "street name"
nominees for which proxies are voted on some but not all matters
will be considered to be voted only as to those matters actually
voted, and will not have the effect of either an affirmative or
negative vote as to the matters with respect to which a
beneficial holder has not provided voting instructions.
The execution of a proxy will not affect a stockholder's right
to attend the Annual Meeting and to vote in person. A
stockholder who executes a proxy may revoke it at any time before
it is exercised by giving written notice to the Secretary, by
appearing at the Annual Meeting and so stating, or by submitting
another duly executed proxy bearing a later date.
The date of this Proxy Statement is the approximate date on
which the Proxy Statement and form of proxy were first sent or
given to stockholders.
<PAGE>
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 who shall be divided into three
classes, with the term of one class expiring each year. The
Board of Directors is presently comprised of six members: Brian
J. Lipke, Arthur A. Russ, Jr. and William P. Montague, Class I
Directors whose terms expire in 1999; Neil E. Lipke and Gerald S.
Lippes, Class II Directors whose terms expire in 1998; and David
N. Campbell, Class III Director whose term expires in 2000. At
the Annual Meeting of Stockholders in 1998, two Class II
Directors shall be elected to hold office for a term expiring in
2001. Neil E. Lipke and Gerald S. Lippes have been nominated by
the Board of Directors for election as such Class II Directors.
The Class II Directors will be elected by a plurality of the
votes cast at the meeting.
Unless instructions to the contrary are received, it is
intended that the shares represented by proxies will be voted for
the election of Neil E. Lipke and Gerald S. Lippes as Directors.
Each of Messrs. Lipke and Lippes has been a Director of the
Company since the consummation of the Company's initial public
offering in November 1993 and has been previously elected by the
Company's stockholders. If either Mr. Lipke or Mr. Lippes or
both should become unavailable for election for any reason, it is
intended that the shares represented by the proxies solicited
herewith will be voted for such other person or persons as the
Board of Directors shall designate. The Board of Directors has
no reason to believe that either Mr. Lipke or Mr. Lippes will be
unable or unwilling to serve if elected to office.
The following information is provided concerning the Directors
and the nominees for election as Class II Directors:
Brian J. Lipke has been Chairman of the Board, President and
Chief Executive Officer and a Director since its formation. He
has been President and Chief Executive Officer of Gibraltar Steel
Corporation of New York ("Gibraltar New York"), a predecessor and
current subsidiary of the Company, since 1987, and has been in
charge of the Company's other subsidiaries since their formation.
From 1972 to 1987, Mr. Lipke held various positions with
Gibraltar New York in production, purchasing and divisional
management. He is a director of C. H. Heist Corporation and
Dunlop Tire Corporation and is a member of the Chase Manhattan
Bank Regional Advisory Board.
Neil E. Lipke has been Executive Vice President - Marketing and
a Director of the Company since its formation. He has been
Executive Vice President of Gibraltar New York since 1988 and has
been employed by Gibraltar New York since 1973 in various
production, sales and marketing capacities.
Gerald S. Lippes has served as a Director of the Company since
its formation. He has been engaged in the private practice of
law since 1965 and is a partner of the firm of Lippes,
Silverstein, Mathias & Wexler LLP, Buffalo, New York. Mr. Lippes
is also a director of Mark IV Industries, Inc.
Arthur A. Russ, Jr. has served as a Director of the Company
since its formation. He has been engaged in the private practice
of law since 1969 and is a member of the firm of Albrecht,
Maguire, Heffern & Gregg, P.C., Buffalo, New York.
David N. Campbell has served as a Director of the Company since
the consummation of the Company's initial public offering. Since
July 1995 Mr. Campbell has served as President of BBN Systems &
Technologies, a networking technology company based in Cambridge,
Massachusetts. From November 1994 to July 1995, he served as
Chairman of the Board of Dunlop Tire Corporation and, prior
thereto, from March 1984 until September 1994 he served as
Chairman of the Board and Chief Executive Officer of Computer
Task Group, Incorporated. Mr. Campbell is also a director of
National Fuel Gas Company and an advisory director of First
Empire State Corporation.
William P. Montague has served as a Director of the Company
since the consummation of the Company's initial public offering.
He served as Executive Vice President and Chief Financial Officer
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<PAGE>
of Mark IV Industries, Inc. from 1986 to February 1996 and, since
March 1, 1996, as President of said company. He is also a
director of Gleason Corp.
THE BOARD OF DIRECTORS AND ITS COMMITTEES
During the fiscal year ended December 31, 1997, the Board of
Directors held five meetings. Each Director attended at least
75% of the aggregate number of meetings of the Board of Directors
and meetings held by all committees of the Board of Directors on
which he served.
AUDIT COMMITTEE
The Board of Directors has a standing Audit Committee comprised
of Messrs. Lippes, Russ and Campbell. The duties of the Audit
Committee consist of reviewing with the Company's independent
auditors and its management, the scope and results of the annual
audit and other services provided by the Company's independent
auditors. The Audit Committee held two meetings in fiscal 1997.
COMPENSATION COMMITTEE
The Compensation Committee, which consists of Messrs. Lippes
and Montague, held three meetings in 1997. The Compensation
Committee makes recommendations concerning salaries and incentive
compensation for employees of and consultants to the Company.
OTHER COMMITTEES
The Board of Directors does not have a standing executive or
nominating committee.
-3-
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information regarding
the Directors and executive officers of the Company:
Name Age Position(s) Held
Brian J. Lipke(A) 46 Chairman of the Board, President and
Chief Executive Officer
Neil E. Lipke(A) 40 Executive Vice President and Director
Walter T. Erazmus 50 Executive Vice President- Finance,
Chief Financial Officer, Secretary
and Treasurer
Joseph A. Rosenecker 53 Executive Vice President - Commercial
Carl P. Spezio 52 Executive Vice President - Manufacturing
Eric R. Lipke(A) 38 Vice President - Transportation
Joseph W. Wark 67 Vice President - Automotive Sales
Gerald S. Lippes 58 Director
David N. Campbell 56 Director
William P. Montague 51 Director
Arthur A. Russ, Jr. 55 Director
____________________________________
(A) Brian J. Lipke, Neil E. Lipke and Eric R. Lipke are brothers.
Recent business experience of the Directors is set forth above
under "Election of Directors." Recent business experience of the
executive officers who are not also Directors is as follows:
Walter T. Erazmus has been Executive Vice President - Finance
of the Company and Chief Financial Officer of the Company since
November 1994 and of Gibraltar New York since 1977 and has served
as Secretary and Treasurer of the Company since its formation.
He was Vice President - Finance of the Company and Chief
Financial Officer of the Company from its formation until
November 1994.
Joseph A. Rosenecker has been Executive Vice President -
Commercial of the Company since November 1994. He served as Vice
President - Sales of the Company from its formation until
November 1994 and has been the director of Gibraltar New York's
cold-rolled strip operations since 1989. He was President of
Gibraltar New York's strip and strapping divisions from 1978 to
1989.
Carl P. Spezio has been Executive Vice President -
Manufacturing since November 1994. Prior thereto, he was Vice
President - Manufacturing and Quality Control of the Company
since its formation. He has been the director of Gibraltar New
York's metal processing operations since 1989. He was President
of the Gibraltar Metals Division of Gibraltar New York from 1977
to 1989.
Joseph W. Wark has been Vice President - Automotive Sales of
the Company since its formation and has been in charge of
automotive sales for Gibraltar New York since 1986.
Eric R. Lipke has been Vice President - Transportation of the
Company since its formation. Mr. Lipke has held various
positions with Gibraltar New York since 1976 primarily in the
areas of administration and executive support.
-4-
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
The following summary compensation table sets forth all compensation
earned by the Company's Chief Executive Officer, and each of the Company's
other four most highly compensated executive officers, for the Company's
fiscal years ended December 31, 1995, 1996 and 1997.
SUMMARY COMPENSATION TABLE
<TABLE>
Long-Term
Other Compen- All
Annual sation Other
Name and Fiscal Compen- Awards Compen-
Principal Position Year Salary Bonus sation Options sation (A)
<S> <C> <C> <C> <C> <C> <C>
Brian J. Lipke, 1997 $ 265,000 $ 205,500 --- 25,000(B) $ 6,535
Chairman of the Board, 1996 248,558 211,000 --- --- 82,974
President and Chief 1995 215,000 140,000 --- --- 3,844
Executive Officer
Joseph A. Rosenecker, 1997 237,000 227,504 --- 12,500(C) 9,669
Executive Vice Presi- 1996 142,000 341,419 --- 15,000(C) 11,164
dent - Commercial 1995 153,000 215,620 --- 12,500(C) 9,524
Neil E. Lipke, 1997 240,404 161,500 --- 20,000(B) 8,526
Executive Vice Presi- 1996 209,250 183,000 --- --- 75,635
dent and Director 1995 183,474 115,000 --- --- 7,186
Joseph W. Wark, 1997 174,898 235,819 --- 15,000(C) 7,132
Vice President - 1996 181,731 190,348 --- 15,000(C) 9,440
Automotive Sales 1995 175,000 171,174 --- --- 7,938
Walter T. Erazmus 1997 188,557 169,500 --- 15,000(C) 9,408
Executive Vice Presi- 1996 168,173 172,000 --- 15,000(C) 10,314
dent - Finance, 1995 152,548 130,000 --- 12,500(C) 8,069
Secretary and Treasurer
</TABLE>
_______________________________
(A) Composed of: (a) the allocation in 1997 of contributions made pursuant
to the Gibraltar Steel Corporation of New York Profit Sharing Plan in the
amount of $5,871 to the account of each of Messrs. Brian J. Lipke,
Rosenecker, Neil E. Lipke, Wark and Erazmus; (b) the matching contributions
made by the Company in 1997 pursuant to the Gibraltar Steel Corporation of
New York 401(k) Retirement Savings Plan to Messrs. Brian J. Lipke,
Rosenecker, Neil E. Lipke, Wark and Erazmus in the amount of $ -0-, $1,908,
$2,655, $1,261 and $2,563, respectively; and (c) the payment in 1997 of
insurance premiums paid with respect to term life insurance policies
provided for Messrs. Brian J. Lipke, Rosenecker, Neil E. Lipke, Wark and
Erazmus in the amount of $664, $1,890, $-0-, $-0- and $974, respectively.
(B) Represents options issued to Messrs. Brian J. Lipke and Neil E. Lipke
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<PAGE>
pursuant to the Gibraltar Steel Corporation Non-Qualified Stock Option
Plan (the "Non-Qualified Plan").
(C) Represents options granted to Messrs. Rosenecker, Wark and Erazmus
pursuant to the Gibraltar Steel Corporation Incentive Stock Option Plan
(the "Incentive Plan").
OPTIONS GRANTED IN LAST FISCAL YEAR
The following table contains information concerning the grant of stock
options to the named executives in 1997. The exercise price of all such
options is equal to the market value of Common Stock on the date of the grant.
<TABLE>
Percentage of Potential Realizable
Total Options Value at Assumed
Granted to Exercise Annual Rates of Stock
Name and Employees in Price Price Appreciation
Principal Option Fiscal Per Expiration For Option Term
Position Grants(A) Year Share Date 5%(B) 10%(C)
<S> <C> <C> <C> <C> <C> <C>
Brian J. Lipke,
Chairman of the
Board, President
and Chief
Executive Officer 25,000 11.34% $ 21.75 7/7/07 $ 341,961 $ 866,597
Joseph A. Rosenecker,
Executive Vice
President -
Commercial 12,500 5.67% 21.75 7/7/07 170,981 433,299
Neil E. Lipke,
Executive Vice
President and
Director 20,000 9.07% 21.75 7/7/07 273,569 693,278
Joseph W. Wark,
Vice President -
Automotive Sales 15,000 6.80% 21.75 7/7/07 205,177 519,958
Walter T. Erazmus,
Executive Vice Presi-
dent - Finance,
Secretary and
Treasurer 15,000 6.80% 21.75 7/7/07 205,177 519,958
</TABLE>
- - -----------------------
(A)Options granted pursuant to the Incentive Plan and the Non-
Qualified Plan become exercisable in cumulative annual increments
of 25% beginning one year from the date of grant; however, in the
event of certain extraordinary transactions, including a change
of control of the Company, the vesting of such options would
automatically accelerate.
(B)Represents the potential appreciation of the options,
determined by assuming an annual compounded rate of appreciation
of 5% per year over the ten-year term of the grants, as
prescribed by the rules. The amount set forth above is not
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<PAGE>
intended to forecast future appreciation, if any, of the stock
price. There can be no assurance that the appreciation reflected
in this table will be achieved.
(C)Represents the potential appreciation of the options,
determined by assuming an annual compounded rate of appreciation
of 10% per year over the ten-year term of the grant. The amounts
set forth above are not intended to forecast future appreciation,
if any, of the stock price. There can be no assurance that the
appreciation reflected in this table will be achieved.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL
YEAR-END OPTION VALUES
The following table sets forth information with respect to the
named executives concerning the exercise of options during 1997
and unexercised options held at the end of 1997.
<TABLE> Value of
Number of Unexercised in the
Unexercised Options Money Options
Shares At Fiscal Year End At Fiscal Year End(A)
Acquired Value
On Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Brian J. Lipke,
Chairman of the
Board, President
and Chief
Executive Officer --- --- 11,250 28,750 $ 109,688 $ 36,563
Joseph A. Rosenecker,
Executive Vice
President -
Commercial Sales 15,000 $ 224,688 18,750 32,500 145,000 112,813
Neil E. Lipke,
Executive Vice
President and
Director --- --- 7,500 22,500 73,125 24,375
Joseph W. Wark,
Vice President -
Automotive Sales 15,000 181,525 --- 28,750 --- 58,125
Walter T. Erazmus,
Executive Vice Presi-
dent - Finance,
Secretary and
Treasurer 15,000 224,688 18,750 35,000 145,000 112,813
</TABLE>
________________________________
(A)Represents the difference between $19.75, the closing market
value of Common Stock as of December 31, 1997, and the exercise
price of such options.
EMPLOYMENT AGREEMENT
Pursuant to an Employment Agreement effective as of November 1,
1993 between the Company and Brian J. Lipke (the "Employment
Agreement"), Mr. Lipke will serve as Chairman of the Board,
President and Chief Executive Officer of the Company at an annual
base salary of $195,000, subject to annual adjustment as
determined by the Compensation Committee in its discretion. In
addition to his base salary, Mr. Lipke will be eligible to
participate in the Company's bonus compensation plans and other
employee benefit plans available to the Company's executive
officers. The Employment Agreement has an initial term of five
years, which automatically is extended for an additional one-year
period on each anniversary date, unless either party gives notice
of intent to terminate.
The Employment Agreement provides that if the Company
terminates Mr. Lipke without cause, he shall be entitled to
receive a lump sum benefit equal to 2 1/2 times his total cash
compensation for the 12-month period immediately preceding the
date of his termination.
The Employment Agreement further provides for severance
benefits upon a change in control of the Company. Events that
trigger a "change in control" under the Employment Agreement
include (i) certain consolidations or mergers, (ii) certain sales
or transfers of substantially all of the Company's assets, (iii)
the approval of the Company's shareholders of a plan of
dissolution or liquidation of the Company, (iv) the acquisition
of 20% or more of the Company's outstanding common stock by
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<PAGE>
certain persons (other than the Company's executive officers and
directors, whether individually or as a group) and (v) certain
changes in the membership of the Company's Board of Directors.
If Mr. Like's employment is terminated within three years of a
change in control, he may be entitled to receive a lump sum
severance payment equal to $100 less than three times the average
of his total cash compensation during the three-year period
immediately preceding his termination, plus medical, disability
and life insurance benefits for the rest of his life. The
payments and benefits otherwise would not constitute parachute
payments that would be subject to excise tax payments or
corporate deduction disallowance under the Internal Revenue Code
of 1986, as amended. In addition, upon a termination of Mr.
Lipke's employment other than by the Company for cause and other
than voluntarily by Mr. Lipke, if he becomes entitled to receive
benefits under any of the Company's tax-qualified retirement
plans (the "Plans"), he will be entitled to receive from the
general assets of the Company an additional benefit computed as
if the Plans were not subject to any applicable limits imposed on
such plans by the Code or the Employee Retirement Income Security
Act of 1974, as amended.
If Mr. Lipke dies during the term of the Employment Agreement,
in addition to any death benefits payable under life insurance
maintained by the Company and any death benefits payable under
the Company's employee benefit plans, the Company will pay to the
estate of Mr. Lipke a death benefit equal to 50% of his annual
base salary plus an amount equal to all bonuses he would have
received through the end of the then current fiscal year. If he
becomes permanently disabled, Mr. Lipke will be entitled to
receive from the Company annual benefits equal to his base
salary, subject to a cap of $200,000 (adjusted for cost of living
increases), less amounts received under any pension, profit
sharing or disability plan or insurance policy.
In the event Mr. Lipke's employment with the Company is
terminated other than for cause, the Company will continue to
provide medical, disability and life insurance benefits to Mr.
Lipke for life, subject to reduction to the extent he receives
such benefits from other sources.
Mr. Lipke has agreed in the Employment Agreement that, in the
event he terminates his employment other than following a change
in control, he will not, for a period of one year after the date
of termination, participate in any "competitive operation," as
defined in the Employment Agreement.
In 1997, none of the executive officers of the Company served
on the compensation committee or on any other committee of the
board of directors performing similar functions of any other
entity, any of whose officers or directors served on the
Company's Board of Directors or Compensation Committee.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Company's Executive Compensation Program is designed to
attract and retain top-quality executives and to provide them
with both an incentive and a reward for superior performance.
The program includes three principal components - base salary,
annual profit-based bonus opportunities and long-term incentives.
The program is administered by the Compensation Committee of the
Board of Directors. Members of the Compensation Committee are
outside directors who are not employees of the Company.
COMPENSATION PHILOSOPHY
The primary philosophy of the Company's Executive Compensation
Program is to align the financial interest of its executive
officers with those of the Company and its stockholders by basing
a significant portion of each executive officer's compensation
upon his individual performance and the Company's financial
performance and by encouraging executive officers to own Company
stock through participation in various stock option and other
benefit plans.
The Compensation Committee is responsible for making annual
adjustments to the base salary of Mr. Lipke, allocating bonuses
to the executive officers under the Company's Incentive Bonus
Plan and granting options to eligible participants, including
executive officers, under the Company's Incentive Stock Option
Plan and Non-Qualified Stock Option Plan. The annual base
salaries of the other executive officers of the Company are
determined by Mr. Lipke. The Compensation Committee utilizes
industry surveys and executive compensation reports as guidelines
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<PAGE>
for the reasonableness of the compensation paid to the Companies'
executive officers, but individual performance and the Company's
financial performance are the determining factors in individual
compensation decisions.
ANNUAL BASE SALARY
The annual base salary of Mr. Lipke is established by his
employment agreement, subject to annual adjustments determined in
the discretion of the Compensation Committee.
EXECUTIVE INCENTIVE BONUS PLAN
The Company's Executive Incentive Bonus Plan was adopted to
provide its executive officers with a quarterly incentive
compensation program. This plan provides for a quarterly bonus
pool in an amount equal to the lesser of (i) 60% of the aggregate
base compensation of the participating executive officers or (ii)
l5% of the Company's net income before taxes and any incentive
bonuses for the quarter on which the bonuses are based. This
bonus pool is then adjusted as follows: 50% of the bonus pool is
available for bonus allocations regardless of the Company's
performance; 25% is available only if the Company satisfied its
operating profit goal for the quarter as established by the Board
of Directors; and 25% is available only if the Company satisfies
its return and equity goals for the quarter as established by the
Board of Directors. Within these parameters, the Compensation
Committee determines the amount to be paid to each executive
officer, considering such factors as the officer's performance
during the quarter and the Company's overall financial
performance during the quarter. These factors vary by individual
and do not include quantifiable objectives. However, there is no
formal weighting of the various factors and the final
determination of each executive officer's bonus is based upon the
recommendation of the person to whom such executive officer
reports, with final approval by the Compensation Committee.
Bonuses paid under the Company's Executive Incentive Bonus Plan
for 1997 reflect the Company's attainment of its operating profit
goal and return on equity goal for each quarter.
STOCK OPTIONS
The Compensation Committee administers both the Company's
Incentive Stock Option Plan and Non-Qualified Stock Option Plan.
In 1997, stock options were granted by the Compensation Committee
under the Incentive Stock Option Plan to key management employees
of the Company, including executive officers. All of the options
granted in 1997 had an exercise price of not less than 100% of
the fair market value of the underlying stock on the date of
grant. The value of the options granted is wholly dependent on
the increase in value of the Company's common stock, which serves
as an incentive to the executive officers to maximize their
efforts to promote the economic performance of the Company. All
of the options granted in 1997 are exercisable over a four-year
period at the rate of 25% per year commencing one year from the
date of grant. Accordingly, an executive officer must remain
with the Company for at least four years in order to enjoy the
full economic benefit of the options awarded. The number of
options awarded to a particular executive officer is directly
related to his responsibilities and individual performance.
COMPENSATION FOR THE CHIEF EXECUTIVE OFFICER
Mr. Lipke participates in the same compensation programs
provided to the Company's other executive officers. The
Compensation Committee awarded Mr. Lipke a bonus under the
Company's Executive Incentive Bonus Plan in the sum of $205,500.
This award recognizes the achievement of the Company's operating
profit goal and return on equity goal for each quarter of 1997
and reflects Mr. Lipke's personal contribution to the Company's
overall success.
Mr. Lipke was also awarded options to purchase 25,000 shares
under the Non-Qualified Plan . These options vest at the rate of
25% per year over a four-year period and are exercisable at the
fair market value of the underlying stock on the date of the
grant.
SECTION 162(m) OF INTERNAL REVENUE CODE
Section 162(m) of the Internal Revenue Code, generally
disallows a tax deduction to public companies for compensation in
excess of $l,000,000 paid to a Company's chief executive officer
and any one of the four other most highly paid executive officers
during its taxable year. Qualifying performance-based
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compensation is not subject to the deduction limit if certain
requirements are met. Based upon the compensation paid to Mr.
Lipke and the Company's other executive officers in 1997, it does
not appear that the Section l62(m) limitation will have an impact
on the Company in the near term. However, the Compensation
Committee plans to review this matter periodically and to take
such actions as are appropriate to minimize the impact of this
statute.
COMPENSATION COMMITTEE OF THE
BOARD OF DIRECTORS OF
GIBRALTAR STEEL CORPORATION
Gerald S. Lippes
William P. Montague
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PERFORMANCE GRAPH
The Performance Graph shown below compares the cumulative total
shareholder return on Common Stock, based on the market price of
the Common Stock, with the total return of the S&P MidCap 400
Index and the S&P Iron & Steel Index. The comparison of total
return assumes that a fixed investment of $100 was invested on
November 4, 1993 (the effective date of the Company's initial
public offering) in Common Stock and in each of the foregoing
indices and further assumes the reinvestment of dividends. The
stock price performance shown on the graph is not necessarily
indicative of future price performance.
11/4/93 12/93 12/94 12/95 12/96 12/97
Gibraltar Steel 100 132 98 110 239 180
S&P MidCap 400 100 111 107 140 166 220
S&P Steel 100 119 115 107 95 97
Values with the exception of 11/4/93 are presented as of December 31
of each year.
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee is composed of Gerald S. Lippes and
William P. Montague, each an outside director of the Company.
Neither Mr. Lippes nor Mr. Montague was, during 1997 or prior
thereto, an officer or employee of the Company or any of its
subsidiaries. In 1997, none of the executive officers of the
Company or members of the Compensation Committee served on the
compensation committee or on any other committee of the board of
directors performing similar functions of any other entity, any
of whose officers or directors served on the Company's Board of
Directors or Compensation Committee.
Gerald S. Lippes is a partner of Lippes, Silverstein, Mathias &
Wexler LLP. During 1997 such firm provided legal services to the
Company.
COMPENSATION OF DIRECTORS
All Directors other than Directors who are employees of the
Company receive a retainer of $12,000 per year. In addition,
each such director also receives a fee of $1,000 for each Board
of Directors or committee meeting attended and is reimbursed for
any reasonable expenses incurred in attending such meetings. In
1997, the Company also awarded each of Messrs. Lippes, Russ,
Montague and Campbell 1,000 shares of Common Stock under its
Restricted Stock Plan. Such shares are forfeitable if the
recipient's tenure as a Director terminates prior to July 1,
2000. Shares issuable under the Restricted Stock Plan are
eligible to receive dividends.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Company's Directors and executive officers,
and any persons who own more than 10% of a registered class of
the Company's equity securities, to file equity securities of the
Company and other reports of initial ownership of Common Stock
and subsequent changes in that ownership with the Securities and
Exchange Commission and to furnish the Company with copies of all
forms they file pursuant to Section 16(a).
To the Company's knowledge, based solely upon a review of the
copies of such reports furnished to the Company and written
representations that no other reports were required, the Company
believes that during the year ended December 31, 1997, all
Section 16(a) filing requirements applicable to its officers,
Directors and greater than 10% beneficial owners were complied
with, except that Mr. Wark filed one statement late covering one
transaction.
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<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of February 28,
1998 (except as otherwise noted) with respect to all stockholders
known by the Company to be the beneficial owners of more than 5%
of its outstanding Common Stock, each Director, each Executive
Officer named in the Summary Compensation table above and all
Executive Officers and Directors as a group.
Name Number of Shares(A) Percent of Class
Brian J. Lipke(B)(C) 1,113,003 8.77%
Neil E. Lipke(B)(D) 1,106,088 8.71
Meredith A. Lipke-de Blok(B)(E) 1,084,743 8.55
Eric R. Lipke(B)(F) 1,078,688 8.50
Curtis W. Lipke(B)(G) 937,543 7.39
Patricia K. Lipke(B)(H) 836,400 6.59
Gerald S. Lippes(I) 100,393 *
700 Guaranty Building
28 Church Street
Buffalo, New York 14202-3950
William P. Montague(J) 65,393 *
501 John James Audubon Parkway
PO Box 810
Amherst, New York 14226-0810
Arthur A. Russ, Jr.(K) 55,438 *
2100 Main Place Tower
Buffalo, New York 14202
David N. Campbell(L) 29,438 *
10 Moulton Street
Cambridge, Massachusetts 02138
Walter T. Erazmus(B)(M) 24,400 *
Joseph A. Rosenecker(B)(N) 21,250 *
Carl P. Spezio(B)(O) 21,012 *
Joseph W. Wark(B)(P) 2,500 *
All Directors and Executive(Q)
Officers as a Group (12 persons) 3,617,603 28.50%
_________________________________
*Less than 1%.
(A)Unless otherwise indicated in the footnotes, each of the
stockholders named in this table has sole voting and investment
power with respect to the shares shown as beneficially owned by
him or her, except to the extent that authority is shared by
spouses under applicable law.
(B)The address of each of the executive officers listed in the
Summary Compensation Table, Meredith A. Lipke-de Blok, Carl P.
Spezio, Curtis W. Lipke, Eric R. Lipke and Patricia K. Lipke is
3556 Lake Shore Road, PO Box 2028, Buffalo, New York 14219-0228.
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<PAGE>
(C)Includes (i) 1,075,948 shares of Common Stock held by two (2)
trusts for the benefit of Brian J. Lipke, (ii) 4,215 shares of
Common Stock held by trusts for the benefit of the daughters of
Brian J. Lipke, (iii) 3,480 shares of Common Stock held in a
custodial account for the benefit of a daughter of Brian J. Lipke
and (iv) 11,250 shares of Common Stock issuable under currently
exercisable options pursuant to the Non-Qualified Plan. Excludes
28,750 shares of Common Stock issuable under options granted to
Brian J. Lipke pursuant to the Non-Qualified Plan which are not
exercisable within sixty (60) days. Also excludes (i) 834,585
shares of Common Stock held by the Trust U/W of Kenneth E. Lipke
f/b/o Patricia K. Lipke (the "Kenneth E. Lipke Trust"), as to
which Brian J. Lipke serves as one of three trustees and shares
voting and investment power and as to which he disclaims
beneficial ownership, (ii) 3,899,182 shares of Common Stock held
by a trust for the benefit of each of Neil E. Lipke, Curtis W.
Lipke, Eric R. Lipke and Meredith A. Lipke-de Blok, as to each of
which Brian J. Lipke serves as one of three trustees and shares
voting and investment power and as to which he disclaims
beneficial ownership, (iii) 30,000 shares of Common Stock held by
a trust for the benefit of Meredith A. Lipke-de Blok, as to which
Brian J. Lipke serves as one of five trustees and shares voting
and investment power and as to which he disclaims beneficial
ownership, (iv) 2,640 shares of Common Stock held by a trust for
the benefit of the daughter of Meredith A. Lipke-de Blok, as to
which Brian J. Lipke serves as one of four trustees and shares
voting and investment power and as to which he disclaims
beneficial ownership, and (v) 2,580 shares of Common Stock held
by trusts for the benefit of the children of Erie P. Lipke, as to
which Brian J. Lipke serves as one of three trustees and shares
voting an investment power and as to which he disclaims
beneficial ownership.
(D)Includes (i) 1,028,568 shares of Common Stock held by a trust
for the benefit of Neil E. Lipke and (ii) 7,500 shares of Common
Stock issuable under currently exercisable options granted to
Neil E. Lipke pursuant to the Non-Qualified Plan. Excludes
22,500 shares of Common Stock issuable under options granted to
Neil E. Lipke pursuant to the Non-Qualified Plan which are not
exercisable within sixty (60) days. Also excludes (i) 60,880
shares of Common Stock held by a trust for the benefit of Brian
J. Lipke and 30,000 shares of Common Stock held by a trust for
the benefit of Meredith A. Lipke-de Blok, as to each of which
Neil E. Lipke serves as one of five trustees and shares voting
and investment power and as to which he disclaims beneficial
ownership, (ii) 4,215 shares of Common Stock held by trusts for
the benefit of the daughters of Brian J. Lipke, as to which Neil
E. Lipke serves as one of three trustees and shares voting and
investment power and as to which he disclaims beneficial
ownership and 2,580 shares of Common Stock held by trusts for the
benefit of the children of Eric R. Lipke, as to which Neil E.
Lipke serves as one of three trustees and shares voting and
investment power and as to which he disclaims beneficial
ownership.
(E)Includes (i) 1,070,603 shares of Common Stock held by three
(3) trusts for the benefit of Meredith A. Lipke-de Blok, (ii)
4,400 shares of Common Stock held in a custodial account for the
benefit of the daughter of Meredith A. Lipke-de Blok pursuant to
the New York Uniform Gift to Minors Act and (iii) 2,640 shares of
Common Stock held by a trust for the benefit of the daughter of
Meredith A. Lipke-de Blok. Excludes 2,500 shares of Common Stock
issuable under options granted to Meredith A Lipke-de Blok
pursuant to the Non-Qualified Plan which are not exercisable
within sixty (60) days. Also excludes 60,880 shares of Common
Stock held by a trust for the benefit of Brian J. Lipke, as to
which Meredith A. Lipke-de Blok serves as one of five trustees
and shares voting and investment power and as to which she
disclaims beneficial ownership.
(F)Includes (i) 992,568 shares of Common Stock held by a trust
for the benefit of Eric R. Lipke, (ii) 2,580 shares of Common
Stock held by trusts for the benefit of the children of Eric R.
Lipke and (iii) 7,500 shares of Common Stock issuable under
currently exercisable options granted to Eric R. Lipke pursuant
to the Non-Qualified Plan and (iv) 3,360 shares of Common Stock
held in custodial accounts for the benefit of the children of
Eric R. Lipke. Excludes 12,500 shares of Common Stock issuable
under options granted to Eric R. Lipke pursuant to the Non-
Qualified Plan which are not exercisable within sixty (60) days.
Also excludes (i) 1,015,068 shares of Common Stock held by a
trust for the benefit of Brian J. Lipke, as to which Eric R.
Lipke serves as one of three trustees and shares voting and
investment power and as to which Eric R. Lipke disclaims
beneficial ownership, (ii) 60,880 shares of Common Stock held by
a trust for the benefit of Brian J. Lipke and 30,000 shares of
Common Stock held by a trust for the benefit of Meredith A. Lipke-
de Blok, as to each of which Eric R. Lipke serves as one of five
trustees and shares voting and investment power and as to which
he disclaims beneficial ownership and (iii) 4,215 shares of
Common Stock held by trusts for the benefit of the children of
Brian J. Lipke, as to which Eric R. Lipke serves as one of three
trustees and shares voting and investment power and as to which
he disclaims beneficial ownership.
(G)Includes 866,523 shares of Common Stock held by a trust for
the benefit of Curtis W. Lipke and excludes (i) 60,880 shares of
Common Stock held by a trust for the benefit of Brian J. Lipke
and 30,000 shares of Common Stock held by a trust for the benefit
of Meredith A. Lipke-de Blok, as to each of which Curtis W. Lipke
serves as one of five trustees and shares voting and investment
power and as to which he disclaims beneficial ownership, (ii)
2,640 shares of Common Stock held by a trust for the benefit of
the daughter of Meredith A. Lipke-de Blok, as to which Curtis W.
Lipke serves as one of four trustees and shares voting and
investment power and as to which he disclaims beneficial
ownership, (iii) 4,215 shares of Common Stock held by trusts for
the benefit of the children of Brian J. Lipke, as to which Curtis
W. Lipke serves as one of three trustees and shares voting and
investment power and as to which he disclaims beneficial
ownership and (iv) 2,580 shares of Common Stock held by trusts
for the benefit of the children of Eric R. Lipke, as to which
Curtis W. Lipke serves as one of the trustees and shares voting
and investment power and as to which he disclaims beneficial
ownership.
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<PAGE>
(H)Includes 834,585 shares of Common Stock held by the Kenneth E.
Lipke Trust. Excludes 2,640 shares of Common Stock held by a
trust for the benefit of the daughter of Meredith A. Lipke-de
Blok, as to which Patricia K. Lipke serves as one of four
trustees and shares voting and investment power and as to which
she disclaims beneficial ownership.
(I)Includes 50,938 shares of Common Stock issuable under
currently exercisable options granted to Mr. Lippes pursuant to
the Non-Qualified Plan. Excludes 312 shares of Common Stock
issuable under options granted to Mr. Lippes pursuant to the Non-
Qualified Plan which are not exercisable within sixty (60) days.
(J)Includes 25,938 shares of Common Stock issuable under
currently exercisable options granted to Mr. Montague pursuant to
the Non-Qualified Plan. Excludes 312 shares of Common Stock
issuable under options granted to Mr. Montague pursuant to the
Non-Qualified Plan which are not exercisable within sixty (60)
days.
(K)Includes (i) 50,938 shares of Common Stock issuable under
currently exercisable options granted to Mr. Russ pursuant to the
Non-Qualified Plan and (ii) an aggregate of 1,500 shares of
Common Stock held by three (3) trusts for the benefit of the
Russ' children as to each of which Mr. Russ serves as a trustee.
Excludes 312 shares of Common Stock issuable under options
granted to Mr. Russ pursuant to the Non-Qualified Plan which are
not exercisable within sixty (60) days. Also excludes an
aggregate of (i) 4,914,250 shares of Common Stock owned by a
trust for the benefit of each Brian J. Lipke, Neil E. Lipke,
Curtis W. Lipke, Eric R. Lipke and Meredith A. Lipke-de Blok, as
to each of which Mr. Russ serves as one of three trustees and
shares voting and investment power and as to which he disclaims
beneficial ownership and (ii) 834,585 shares of Common Stock held
by the Kenneth E. Lipke Trust, as to which Mr. Russ serves as one
of three trustees and shares voting and investment power and as
to which he disclaims beneficial ownership.
(L)Includes 25,938 shares of Common Stock issuable under
currently exercisable options granted to Mr. Campbell pursuant to
the Non-Qualified Plan. Excludes 312 shares of Common Stock
issuable under options granted to Mr. Campbell pursuant to the
Non-Qualified Plan which are not exercisable within sixty (60)
days.
(M)Includes (i) 18,750 shares of Common Stock issuable under
currently exercisable options granted to Mr. Erazmus under the
Incentive Plan, (ii) 800 shares of Common Stock held by an
Individual Retirement Account for the benefit of Mr. Erazmus,
(iii) 500 shares of Common Stock held by an Individual Retirement
Account for the benefit of the spouse of Mr. Erazmus and (iv)
1,350 shares of Common Stock allocated to Mr. Erazmus's self-
directed account under the Company's 401(k) Retirement Savings
Plan. Excludes 35,000 shares of Common Stock issuable under
options granted to Mr. Erazmus pursuant to the Incentive Plan
which are not exercisable within sixty (60) days.
(N)Includes 18,750 shares of Common Stock issuable under
currently exercisable options granted to Mr. Rosenecker under the
Incentive Plan. Excludes 32,500 shares of Common Stock issuable
under options granted to Mr. Rosenecker pursuant to the Incentive
Plan which are not exercisable within sixty (60) days.
(O)Includes (i) 18,750 shares of Common Stock issuable under
currently exercisable options granted to Mr. Spezio under the
Incentive Plan and (ii) 235 shares of Common Stock allocated to
Mr. Spezio's self-directed account under the Company's 401(k)
Retirement Savings Plan. Excludes 32,500 shares of Common Stock
issuable under options granted to Mr. Spezio pursuant to the
Incentive Plan which are not exercisable within sixty (60) days.
(P)Excludes 28,750 shares of Common Stock issuable under options
granted to Mr. Wark pursuant to the Incentive Plan which are not
exercisable within sixty (60) days.
(Q)Includes options to purchase an aggregate of 56,250 shares of
Common Stock issuable to certain executive officers under the
Incentive Plan and an aggregate of 180,002 shares of Common Stock
issuable to certain executive officers and directors under the
Non-Qualified Plan, all of which are exercisable within sixty
(60) days. Excludes options to purchase an aggregate of 128,750
shares of Common Stock issued to certain executive officers under
the Incentive Plan and an aggregate of 64,998 shares of Common
Stock issued to certain executive officers and directors under
the Non-Qualified Plan, none of which are exercisable within
sixty (60) days.
VOTE REQUIRED. The affirmative vote of a plurality of the
shares of Common Stock present, in person or by proxy, is
required for the election of each Director, assuming a quorum is
present or represented at the meeting.
The Board of Directors recommends a vote "FOR" the nominee for
Class III Director.
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<PAGE>
PROPOSAL 2
AMENDMENT AND RESTATEMENT OF THE GIBRALTAR STEEL CORPORATION
INCENTIVE STOCK OPTION PLAN
On May 20, 1997, the Board of Directors approved the Third
Amendment and Restatement of the Incentive Plan (the "Incentive
Plan Restatement"), providing: (i) for an increase in the number
of shares of Common Stock reserved for issuance under the
Incentive Plan from 600,000 to 850,000 shares; (ii) that members
of the committee that administers the Incentive Plan will be
eligible to receive options under the Incentive Plan; (iii) that
employees that own 10% or more of the combined voting power of
all classes of the Company's outstanding capital stock will be
permitted to receive options subject to certain minimum
requirements (described below) regarding the option exercise
price and the option exercise period; and (iv) that, under
certain limited circumstances, options granted to executive
officers will be transferable. Pursuant to the terms of the
Incentive Plan, the Board of Directors is seeking stockholder
approval of the Incentive Plan Restatement.
Information concerning the number of options granted to certain
executive officers under the Incentive Plan during the last year
is set forth above under the heading "Executive Compensation."
The following is a summary of the material features of the
Incentive Plan Restatement and does not purport to be complete.
The summary is subject in all respects and is qualified in its
entirety by reference to the Incentive Plan Restatement, the full
text of which is set forth as Appendix A to this Proxy Statement.
Purpose. The Incentive Plan is intended to provide officers
and other key employees of the Company and its subsidiaries with
an additional incentive for them to promote the business of the
Company, to increase their propriety interest in the success of
the Company and to encourage them to remain in the employ of the
Company.
Administration. The Incentive Plan is administered by a
committee appointed by the Board of Directors and consisting of
not less than two Directors (the "Incentive Committee"). The
Incentive Committee has the sole authority to grant options under
the Incentive Plan, and all actions taken by the Incentive
Committee in administering the Incentive Plan are final.
Reservation of Common Stock. The Company has reserved 600,000
shares of Common Stock for issuance under the Incentive Plan. In
the event the Incentive Plan Restatement is approved, there will
be 850,000 shares of Common Stock reserved. Any options issued
under the Incentive Plan which are forfeited or terminated, will
be available for reissuance under the Incentive Plan. If the
Company's outstanding shares of Common Stock are increased or
decreased as a result of stock dividends, stock splits,
recapitalizations or other means having the same effect, or if
the Company's Common Stock is converted into other shares or
securities of the Company as a result of a reorganization, the
number of shares of Common Stock available for issuance under the
Incentive Plan and the number of shares of Common Stock issuable
under outstanding options under the Incentive Plan shall be
proportionately adjusted by the Incentive Committee.
Participants. The Incentive Committee shall determine from
among the officers and key employees of the Company and its
subsidiaries those individuals to whom options under the
Incentive Plan shall be granted, the terms and provisions of the
options granted (which terms need not be identical), the time or
times at which options shall be granted and the number of shares
of Common Stock for which options are granted. As of December
31, 1997, 89 employees had received options under the Incentive
Plan.
Option Price. The exercise price of each option granted under
the Incentive Plan shall be determined by the Incentive Committee
at the time the option is granted, but in no event shall such
exercise price be less than 100% of the fair market value of the
Common Stock on the date of the grant. Notwithstanding the
foregoing, if any options are granted to individuals holding 10%
or more of the combined voting power of all classes of the
Company's outstanding capital stock, in no event shall the
exercise price of the options granted to any such individuals be
less than 110% of the fair market value of the Common Stock on
the date of the grant.
Option Exercise Periods. Any option granted under the
Incentive Plan may be exercised not earlier than one year nor
later than ten years from the date such option is granted,
provided that, options granted to individuals holding 10% or more
of the combined voting power of all classes of the Company's
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<PAGE>
outstanding capital stock may not be exercised later than five
years from the date any such options are granted. The recipient
of an option must remain in the continuous employment of the
Company or its subsidiaries from the date of the grant of the
option to and including the date of exercise of the option. In
addition, with respect to all options granted under the Incentive
Plan, unless the Incentive Committee shall specify otherwise, the
right of a recipient to exercise his option shall accrue, on a
cumulative basis, at the rate of 25% per year. Upon a "change in
control" of the Company (as defined in the Incentive Plan) or
upon the retirement, death or disability of a recipient, all
outstanding unexercised options granted to such recipient under
the Incentive Plan become immediately exercisable.
Federal Tax Consequences. The Code limits to $l00,000 the
value of employer stock subject to incentive stock options that
first become exercisable in any one year, based on the fair
market value of the stock at the date of grant. Upon exercise,
an optionee will not realize federally taxable income (except
that the alternative minimum tax may apply) and the Company will
not be entitled to any deduction. If the optionee sells the
shares more than two years after the grant date and more than one
year after exercise, the entire gain, if any, realized upon the
sale will be federally taxable to the optionee as long-term
capital gain and the Company will not be entitled to a
corresponding deduction. If the optionee does not satisfy the
holding period requirements, the optionee will realize ordinary
income, in most cases equal to the difference between the option
price of the shares and the lesser of the fair market value of
the shares on the exercise date or the amount realized on a sale
or exchange of the shares, and the Company will be entitled to a
corresponding deduction.
Transferability. Generally, options granted under the
Incentive Plan are not transferable by a recipient during his
lifetime. However, to the extent that an executive officer of
the Company has received options that first become exercisable in
any one year, which options have fair market value (based on the
fair market value of the Common Stock at the date of the option
grant) which exceeds $100,000, such executive officers may
transfer to their immediate family members, options to purchase
common stock of the Company having an aggregate value equal to
the amount by which the aggregate value of all options which
first become exercisable in such year exceeds $100,000.
Amendments. The Board of Directors may suspend, amend or
terminate the Incentive Plan, provided that, in the absence of
stockholder approval, no such amendment shall (i) increase the
maximum number of shares as to which options may be issued under
the Incentive Plan (ii) materially increase the benefits accruing
to participants under the Incentive Plan or (iii) materially
modify the requirements as to eligibility or participation in the
Incentive Plan.
Effective Date. The Incentive Plan was approved initially by
the stockholders of the Company on September 21, 1993. The First
Amendment was adopted by the Company effective August 9, 1994.
Vote Required. The Affirmative vote of the holders of a
majority of the shares of Common Stock present, in person or by
proxy, and entitled to vote at the Meeting is required to approve
the Incentive Plan Restatement. If the stockholders do not
approve the Incentive Plan Restatement, the Incentive Plan in its
current form will remain in effect.
The Board of Directors recommends a vote "FOR" Proposal 2.
OTHER MATTERS
The Company's management does not presently know of any matters
to be presented for consideration at the Annual Meeting other
than the matters described in the Notice of Annual Meeting.
However, if other matters are presented, the accompanying proxy
confers upon the person or persons entitled to vote the shares
represented by the proxy, discretionary authority to vote such
shares in respect of any such other matter in accordance with
their best judgment.
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<PAGE>
OTHER INFORMATION
Price Waterhouse LLP has been selected as the independent
auditors for the Company's current fiscal year and has been the
Company's independent auditors for its most recent year ended
December 31, 1997.
Representatives of Price Waterhouse LLP are expected to be
present at the 1998 Annual Meeting of Stockholders and will have
the opportunity to make a statement, if they so desire, and will
be available to respond to appropriate questions.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON WHOSE
PROXY IS SOLICITED, ON THE WRITTEN REQUEST OF SUCH PERSON, A COPY
OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K, FOR THE FISCAL YEAR
ENDED DECEMBER 31, 1997, FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, INCLUDING THE FINANCIAL STATEMENTS AND THE SCHEDULES
THERETO. Such written request should be directed to Gibraltar
Steel Corporation, 3556 Lake Shore Road, PO Box 2028, Buffalo,
New York 14219-0228, Attention: Walter T. Erazmus. Each such
request must set forth a good faith representation that, as of
March 23, 1998, the person making the request was a beneficial
owner of securities entitled to vote at the Annual Meeting of
Stockholders.
STOCKHOLDERS' PROPOSALS
Proposals of stockholders intended to be presented at the 1998
Annual Meeting must be received by the Company by December __,
1998 to be considered for inclusion in the Company's Proxy
Statement and form of proxy relating to that meeting.
The accompanying Notice and this Proxy Statement are sent by
order of the Board of Directors.
WALTER T. ERAZMUS
Secretary
Dated: April __, 1998
_________________________________________________________________
STOCKHOLDERS ARE URGED TO EXECUTE THE ACCOMPANYING PROXY AND
RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE, WHETHER OR NOT
THEY EXPECT TO ATTEND THE MEETING. A STOCKHOLDER MAY
NEVERTHELESS VOTE IN PERSON IF HE DOES NOT ATTEND.
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<PAGE>
APPENDIX A
GIBRALTAR STEEL CORPORATION
INCENTIVE
STOCK OPTION PLAN
___________________________
Third Amendment and Restatement
__________________________
WHEREAS, Gibraltar Steel Corporation, a Delaware corporation
with offices at 3556 Lake Shore Road, Buffalo, New York 14219
(the "Company") adopted an incentive stock option plan known as
the "Gibraltar Steel Corporation Incentive Stock Option Plan (the
"Plan") on September 21, 1993 to enable the Company to attract
and retain highly qualified individuals as officers and key
employees of the Company by providing such officers and key
employees an equity based form of incentive compensation; and
WHEREAS, the Company amended the Plan effective August 9,
1994 to allow members of the Committee of Directors that
administers the Plan to be eligible to receive options under the
terms of other plans which, from time to time, are adopted and
maintained by the Company including, but not limited to, the
Gibraltar Steel Corporation Non-Qualified Stock Option Plan; and
WHEREAS, the Company amended the Plan effective February 15,
1996 to increase the total number of shares of common stock, par
value $.01 per share of the Company (hereinafter the "Common
Stock") which may be issued in connection with options granted
pursuant to the terms of the Plan by Two Hundred Thousand
(200,000) shares; and
WHEREAS, as a result of a change in the provisions of Rule
16b-3 as issued and in effect under the terms of the Securities
and Exchange Act of 1934 prior to August 1, 1996, the Company
desires to amend the Plan to allows options granted under the
terms of the Plan, including previously issued options and
options which may be issued in the future pursuant to the Plan to
be transferred by any Executive Officers of the Company that have
been granted such options to the extent that such options are not
"qualified" options because the fair market value of the common
stock of the Company (determined as of the date of the grant of
such options) which can be acquired pursuant to the exercise of
such options (to the extent such options first become exercisable
in any calendar year) when added to the fair market value of the
common stock of the Company which can be acquired pursuant to the
terms of all other incentive stock options which first become
exercisable in any such calendar year exceeds $100,000; and
WHEREAS, the Company also desires to amend the Plan to
increase the total number of shares of Common Stock which may be
issued in connection with options granted pursuant to the terms
of the Plan by Two Hundred Fifty Thousand (250,000); and
WHEREAS, the Company desires to amend and restate the terms
of the Plan to permit the Executive Officers of the Company to
transfer options which they have or been granted or may, in the
future, be granted to the extent described above, to increase the
number of share of Common Stock which may be issued in connection
with options granted pursuant to the terms of the Plan and to
make certain other technical amendments to the terms of the Plan;
NOW, THEREFORE, in consideration of the foregoing, the
Company hereby adopts the following as the Third Amendment and
Restatement of the Gibraltar Steel Corporation Incentive Stock
Option Plan effective as of May 20, 1997:
1. Purpose of Plan. The Gibraltar Steel Corporation
Incentive Stock Option Plan (the "Plan") is intended to provide
officers and other key employees of the Company and officers and
other key employees of any subsidiaries of the Company as that
term is defined in Section 3 below (hereinafter individually
referred to as a "Subsidiary" and collectively as "Subsidiaries")
with an additional incentive for them to promote the success of
the business, to increase their proprietary interest in the
success of the Company and its Subsidiaries, and to encourage
them to remain in the employ of the Company or its Subsidiaries.
The above aims will be effectuated through the granting of
certain stock options, as herein provided, which are intended to
qualify as Incentive Stock Options ("ISOs") under Section 422 of
the Internal Revenue Code of 1986, as the same has been and shall
be amended ("Code").
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2. Administration. The Plan shall be administered by a
Committee (the "Committee") composed of not less than two (2)
Directors of the Company who shall be appointed by and serve at
the pleasure of the Board of Directors of the Company. If the
Committee is composed of two (2) Directors, both members of the
Committee must approve any action to be taken by the Committee in
order for such action to be deemed to be an action of the
Committee pursuant to the provisions of this Plan. If the
Committee is composed of more than two (2) Directors, a majority
of the Committee shall constitute a quorum for the conduct of its
business, and (a) the action of a majority of the Committee
members present at any meeting at which a quorum is present, or
(b) action taken without a meeting by the approval in writing of
a majority of the Committee members, shall be deemed to be action
by the Committee pursuant to the provisions of the Plan. The
Committee is authorized to adopt such rules and regulations for
the administration of the Plan and the conduct of its business as
it may deem necessary or proper.
Any action taken or interpretation made by the
Committee under any provision of the Plan or any option granted
hereunder shall be in accordance with the provisions of the Code,
and the regulations and rulings issued thereunder as such may be
amended, promulgated, issued, renumbered or continued from time
to time hereafter in order that, to the greatest extent possible,
the options granted hereunder shall constitute "incentive stock
options" within the meaning of the Code. All action taken
pursuant to this Plan shall be lawful and with a view to
obtaining for the Company and the option holder the maximum
advantages under the law as then obtaining, and in the event that
any dispute shall arise as to any action taken or interpretation
made by the Committee under any provision of the Plan, then all
doubts shall be resolved in favor of such having been done in
accordance with the said Code and such revenue laws, amendments,
regulations, rulings and provisions as may then be applicable.
Any action taken or interpretation made by the Committee under
any provision of the Plan shall be final. No member of the Board
of Directors or the Committee shall be liable for any action,
determination or interpretation taken or made under any provision
of the Plan or otherwise if done in good faith.
3. Participation. The Committee shall determine from
among the officers and key employees of the Company and its
Subsidiaries (as such term is defined in Section 424 of the Code)
those individuals to whom options shall be granted (sometimes
hereinafter referred to as "Optionees"), the terms and provisions
of the options granted (which need not be identical), the time or
times at which options shall be granted and the number of shares
of Common Stock, (or such number of shares of stock in which the
Common Stock may at any time hereafter be constituted), for which
options are granted.
In selecting Optionees and in determining the number of
shares for which options are granted, the Committee may weigh and
consider the following factors: the office or position of the
Optionee and his degree of responsibility for the growth and
success of the Company and its Subsidiaries, length of service,
remuneration, promotions, age and potential. The foregoing
factors shall not be considered to be exclusive or obligatory
upon the Committee, and the Committee may properly consider any
other factors which to it seems appropriate. The terms and
conditions of any option granted by the Committee under this Plan
shall be contained in a written statement which shall be
delivered by the Committee to the Optionee as soon as practicable
following the Committee's establishment of the terms and
conditions of such option.
An Optionee who has been granted an option under the
Plan may be granted additional options under the Plan if the
Committee shall so determine.
Notwithstanding the foregoing, if at the time an option
is granted to an individual under this Plan, the individual owns
stock of the Company possessing more than ten percent (10%) of
the total combined voting power of all classes of stock of the
Company or any of its Subsidiaries, (or if such individual would
be deemed to own such percentage of such stock under Section
424(d) of the Code) such option shall continue to be valid and
binding upon the Company according to its terms but shall not be
deemed to have been granted under this Plan and shall not be
deemed to be an "incentive stock option" as defined in Section
422(b) of the Code unless: (a) the price per share at which
common stock of the Company may be acquired in connection with
the exercise of such options is not less than one hundred ten
percent (110%) of the fair market value of such common stock,
determined as of the date of the grant of such options; and (b)
the period of time within which such options must be exercised
does not exceed five (5) years from the date on which such
options are granted. In addition, in no event shall any options
be granted under this Plan at any time after the termination date
set forth at the end of this Plan.
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4. Shares Subject to the Plan. The Company is authorized
to issue options under this Plan for the purchase of the number
of shares of Common Stock described in the following provisions
of this Section 4. On September 21, 1993 (the date on which this
Plan became effective), the aggregate number of shares of Common
Stock which were reserved for issuance pursuant to options which
were permitted to be granted hereunder was Four Hundred Thousand
(400,000) shares (subject to the anti-dilutive adjustments
provided for by Section 5 hereof). Effective February 15, 1996,
in addition to the number of shares of Common Stock reserved for
issuance pursuant to options which were permitted to be granted
as of February 14, 1996, an additional Two Hundred Thousand
(200,000) shares of Common Stock were reserved for issuance
pursuant to options which may be granted hereunder. Effective
May 20, 1997, in addition to the number of shares of Common Stock
reserved for issuance pursuant to options which were permitted to
be granted as of May 19, 1997, an additional Two Hundred Fifty
Thousand (250,000) shares of Common Stock shall be reserved for
issuance pursuant to options which may be granted hereunder.
Accordingly, the total number of shares of Common Stock which may
be issued pursuant to the exercise of options which may be
granted under the terms of this Plan shall be equal to the sum
of: (a) Four Hundred Thousand (400,000) shares (subject to anti-
dilutive adjustments made at any time after September 21, 1993
pursuant to Section 5 hereof); (b) Two Hundred Thousand (200,000)
shares (subject to anti-dilutive adjustments made at any time
after February 15, 1996 pursuant to Section 5 hereof); and (c)
Two Hundred Fifty Thousand (250,000) shares (subject to anti-
dilutive adjustments made at any time after May 20, 1997 pursuant
to Section 5 hereof).
Notwithstanding the foregoing, if this amendment and
restatement to the Plan is not approved by the stockholders of
the Company within twelve (12) months following the effective
date of this amendment and restatement, and if any options are
issued pursuant to the terms of this Plan at any time after: (x)
the total number of shares of Common Stock which may be acquired
upon the exercise of all previously issued options equals: (y)
the sum of: (i) Four Hundred Thousand (400,000) shares (subject
to the anti-dilutive adjustments made at any time after September
21, 1993 pursuant to Section 5 hereof); and (ii) Two Hundred
Thousand (200,000) shares (subject to anti-dilutive adjustments
made at any time after February 15, 1996 pursuant to Section 5
hereof), any option issued after such time shall continue to be
valid and binding upon the Company pursuant to its terms but
shall not be deemed to be an "incentive stock option" as defined
in section 422(b) of the Code.
With respect to shares subject to options which expire
or terminate pursuant to the provisions of this Plan without
having been exercised in full, such shares shall be considered to
be available again for placement under options granted thereafter
under the Plan. Shares issued pursuant to the exercise of
incentive stock options granted under the Plan shall be fully
paid and non-assessable.
5. Anti-Dilution Provisions. The aggregate number of
shares of Common Stock and the class of such shares as to which
options may be granted under the Plan, the number and class of
such shares subject to each outstanding option, the price per
share thereof (but not the total price), and the number of such
shares as to which an option may be exercised at any one time,
shall all be adjusted proportionately in the event of any change,
increase or decrease in the outstanding shares of Common Stock
Company or any change in classification of its Common Stock
without receipt of consideration by the Company which results
either from a split-up, reverse split or consolidation of shares,
payment of a stock dividend, recapitalization, reclassification
or other like capital adjustment so that upon exercise of the
option, the Optionee shall receive the number and class of shares
that he would have received had he been the holder of the number
of shares of Common Stock for which the option is being exercised
immediately preceding such change, increase or decrease in the
outstanding shares of Common Stock. Any such adjustment made by
the Committee shall be final and binding upon all Optionees, the
Company, and all other interested persons. Any adjustment of an
incentive stock option under this paragraph shall be made in such
manner as not to constitute a "modification" within the meaning
of Section 424(h)(3) of the Code.
Anything in this Section 5 to the contrary
notwithstanding, no fractional shares or scrip representative of
fractional shares shall be issued upon the exercise of any
option. Any fractional share interest resulting from any change,
increase or decrease in the outstanding shares of Common Stock or
resulting from any reorganization, merger, or consolidation for
which adjustment is provided in this Section 5 shall disappear
and be absorbed into the next lowest number of whole shares, and
the Company shall not be liable for any payment for such
fractional share interest to the Optionee upon his exercise of
the option.
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6. Option Price. The purchase price under each option
issued shall be determined by the Committee at the time the
option is granted, but in no event shall such purchase price be
less than one hundred percent (100%) of the fair market value of
the Common Stock on the date of the grant. If the Common Stock
is listed upon an established stock exchange or exchanges on the
day the option is granted, such fair market value shall be deemed
to be the highest closing price of the Common Stock on such stock
exchange or exchanges on the day the option is granted, or if no
sale of the Company's Common Stock shall have been made on any
stock exchange on that day, on the next preceding day on which
there was a sale of such stock.
If the Common Stock is listed in the NASDAQ National
Market System, the fair market value of the Common Stock shall be
the average of the high and low closing sale prices in the NASDAQ
National Market System on the day the option is granted, or if no
sale of the Common Stock shall have been made on the NASDAQ
National Market System on that day, on the next preceding day on
which there was a sale of such stock.
7. Option Exercise Periods. The time within which any
option granted hereunder may be exercised shall be, by its terms,
not earlier than one (1) year from the date such option is
granted and not later than ten (10) years from the date such
option is granted. Subject to the provisions of Section 10
hereof, the Optionee must remain in the continuous employment of
the Company or any of its Subsidiaries from the date of the grant
of the option to and including the date of exercise of option in
order to be entitled to exercise his option. Options granted
hereunder shall be exercisable in such installments and at such
dates as the Committee may specify. In addition, with respect to
all options granted under this Plan, unless the Committee shall
specify otherwise, the right of each Optionee to exercise his
option shall accrue, on a cumulative basis, as follows:
(a) one-fourth (1/4) of the total number of shares of
Common Stock which could be purchased (subject to adjustment as
provided in Section 5 hereof) (such number being hereinafter
referred to as the "Optioned Shares") shall become available for
purchase pursuant to the option at the end of the one (1) year
period beginning on the date of the option grant;
(b) one-fourth (1/4) of the Optioned Shares shall
become available for purchase pursuant to the option at the end
of the two (2) year period beginning on the date of the option
grant;
(c) one-fourth (1/4) of the Optioned Shares shall
become available for purchase pursuant to the option at the end
of the three (3) year period beginning on the date of the option
grant; and
(d) one-fourth (1/4) of the Optioned Shares shall
become available for purchase pursuant to the option at the end
of the four (4) year period beginning on the date of the option
grant.
Continuous employment shall not be deemed to be
interrupted by transfers between the Subsidiaries or between the
Company and any Subsidiary, whether or not elected by termination
from any Subsidiary of the Company and re-employment by any other
Subsidiary or the Company. Time of employment with the Company
shall be considered to be one employment for the purposes of this
Plan, provided there is no intervening employment by a third
party or no interval between employments which, in the opinion of
the Committee, is deemed to break continuity of service. The
Committee shall, at its discretion, determine the effect of
approved leaves of absence and all other matters having to do
with "continuous employment". Where an Optionee dies while
employed by the Company or any of its Subsidiaries, his options
may be exercised following his death in accordance with the
provisions of Section 10 below.
Notwithstanding the foregoing provisions of this
Section 7, in the event the Company or the stockholders of the
Company enter into an agreement to dispose of all or
substantially all of the assets or stock of the Company by means
of a sale, merger, consolidation, reorganization, liquidation, or
otherwise, or in the event a Change of Control shall occur, an
option shall become immediately exercisable with respect to the
full number of shares subject to that option during the period
commencing as of the date of execution of such agreement and
ending as of the earlier of: (i) ten (10) years from the date
such option was granted; or (ii) ninety (90) days following the
date on which a Change in Control occurs or the disposition of
assets or stock contemplated by the agreement is consummated.
Ninety (90) days following the consummation of any such
disposition of assets or stock, or Change in Control, this Plan
and any unexercised options issued hereunder (or any unexercised
portion thereof) shall terminate and cease to be effective,
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unless provision is made in connection with such transaction for
assumption of options previously granted or the substitution for
such options of new options covering the securities of a
successor corporation or an affiliate thereof, with appropriate
adjustments as to the number and kind of securities and prices.
For purposes of this Plan, a "Change in Control" shall
be deemed to have occurred if:
(a) any "person" or "group" (within the meaning of
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act) of more
than thirty percent (30%) of the then outstanding voting stock of
the Company, otherwise than through a transaction arranged by, or
consummated with the prior approval of its Board of Directors; or
(b) during any period of two consecutive years,
individuals who at the beginning of such period constitute the
Board of Directors of the Company (and any new director whose
election to the Board of Directors or whose nomination for
election by the Company's stockholders was approved by a vote of
at least two thirds of the directors then still in office who
either were directors at the beginning of such period or whose
election or nomination for election was previously so approved)
(the "Continuing Directors") cease for any reason to constitute a
majority thereof; or
(c) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation, other
than a merger or consolidation which would result in the voting
securities of the Company immediately prior thereto continuing to
represent (either by remaining outstanding or being converted
into voting securities of the surviving entity) at least 80% of
the combined voting power of the voting securities of the Company
or such surviving entity outstanding immediately after such
merger or consolidation (provided, however, that if prior to the
merger or consolidation, the Board of Directors of the Company
adopts a resolution that is approved by a majority of the
Continuing Directors providing that such merger or consolidation
shall not constitute a "Change in Control" for purposes of the
Plan, then such a merger or consolidation shall not constitute a
"Change in Control"); or
(d) the stockholders of the Company approve an
agreement for the sale or disposition by the Company of all or
substantially all the assets of the Company.
Any change or adjustment made pursuant to the terms of
this paragraph shall be made in such a manner so as not to
constitute a "modification" as defined in Section 424 of the
Code, and so as not to cause any incentive stock option issued
under this Plan to fail to continue to qualify as an incentive
stock option as defined in Section 422(b) of the Code.
Notwithstanding the foregoing, in the event that any such
agreement shall be terminated without consummating the
disposition of said stock or assets, any unexercised unaccrued
installments that had become exercisable solely by reason of the
provisions of this paragraph shall again become unaccrued and
unexercisable as of said termination of such agreement; subject,
however, to such installments accruing pursuant to the normal
accrual schedule provided in the terms under which such option
was granted. Any exercise of an installment prior to said
termination of said agreement shall remain effective despite the
fact that such installment became exercisable solely by reason of
the Company or its stockholders entering into said agreement to
dispose of the stock or assets of the Company.
8. Exercise of Option. Options shall be exercised as
follows:
(a) Notice and Payment. Each option, or any
installment thereof, shall be exercised, whether in whole or in
part, by giving written notice to the Company at its principal
office, specifying the options being exercised (by reference to
the date of the grant of the option), the number of shares to be
purchased and the purchase price being paid, and accompanied by
the payment of all or such part of the purchase price as shall be
specified in the option, by cash, certified or bank check payable
to the order of the Company. Each such notice shall contain
representations on behalf of the Optionee that he acknowledges
that the Company is selling the shares being acquired by him
under a claim of exemption from registration under the Securities
Act of 1933 as amended (the "Act"), as a transaction not
involving any public offering; that he represents and warrants
that he is acquiring such shares with a view to "investment" and
not with a view to distribution or resale; and that he agrees not
to transfer, encumber or dispose of the shares unless: (i) a
registration statement with respect to the shares shall be
effective under the Act, together with proof satisfactory to the
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Company that there has been compliance with applicable state law;
or (ii) the Company shall have received an opinion of counsel in
form and content satisfactory to the Company to the effect that
the transfer qualifies under Rule 144 or some other disclosure
exemption from registration and that no violation of the Act or
applicable state laws will be involved in such transfer, and/or
such other documentation in connection therewith as the Company's
counsel may in its sole discretion require.
(b) Issuance of Certificates. Certificates
representing the shares purchased by the Optionee shall be issued
as soon as practicable after the Optionee has complied with the
provisions of Section 8(a) hereof.
(c) Rights as a Stockholder. The Optionee shall have
no rights as a stockholder with respect to the shares of Common
Stock purchased until the date of the issuance to him of a
certificate representing such shares.
9. Assignment of Option.
(a) Subject to the provisions of Sections 9(b) and
10(c) hereof, options granted under this Plan may not be assigned
voluntarily or involuntarily or by operation of law and any
attempt to transfer, assign, pledge, hypothecate or otherwise
dispose of, or to subject to execution, attachment or similar
process, any incentive stock option, or any right thereunder,
contrary to the provisions hereof shall be void and ineffective,
shall give no right to the purported transferee, and shall, at
the sole discretion of the Committee, result in forfeiture of the
option with respect to the shares involved in such attempt.
(b) Notwithstanding anything to the contrary contained
in the terms of the Plan as in effect at any time prior to the
date hereof and notwithstanding anything to the contrary
contained in the terms of any statement, letter or other document
or agreement setting forth the terms and conditions of any
options previously issued pursuant to the terms of this Plan, any
and all Non-Qualified Options (as defined in Section 13 hereof)
previously issued to any officer of the Company (as defined in
Rule 16A-a(f) issued under the Securities and Exchange Act of
1934 (hereinafter an "Executive Officer")) pursuant to the terms
of the Plan and, subject to the approval of the Committee, any
Non-Qualified Options which may be granted or issued to any
Executive Officer of the Company at any time in the future
pursuant to the terms of the Plan shall be transferable by the
Executive Officer to whom such Non-Qualified Options have been or
are granted to: (i) the spouse, children or grandchildren of the
Executive Officer (hereinafter "Immediate Family Members"); (ii)
a trust or trusts for the exclusive benefit of such Immediate
Family Members; (iii) a partnership or limited liability company
in which such Immediate Family Members are the only partners or
members; or (iv) a private foundation established by the
Executive Officer; provided that: (x) there may be no
consideration for any such transfer; (y) in the case of Non-
Qualified Options which may be granted in the future, the
statement, letter or other document or agreement setting forth
the terms and conditions of any such Non-Qualified Options must
expressly provide for and limit the transferability of such Non-
Qualified Options to transfers which are permitted by the
foregoing provisions of this Section 9(b); and (z) any subsequent
transfer of transferred Non-Qualified Options shall, except for
transfers occurring as a result of the death of the transferee as
contemplated by Section 10(e), be prohibited. Following the
transfer of any Non-Qualified Options as permitted by the
foregoing provisions of this Section 9(b), any such transferred
Non-Qualified Options shall continue to be subject to the same
terms and conditions applicable to such Non-Qualified Options
immediately prior to the transfer; provided that, for purposes of
this Plan, the term "Optionee" shall be deemed to refer to the
transferee. Notwithstanding the foregoing, the events of
termination of employment of Section 10 hereof shall continue to
be applied with respect to the original Optionee for the purpose
of determining whether or not the Non-Qualified Options shall be
exercisable by the transferee and, upon termination of the
original Optionee's employment, the Non-Qualified Options shall
be exercisable by the transferee only to the extent and for the
periods specified in Section 10 below.
10. Effect of Termination of Employment, Death or
Disability. (a) In the event of the termination of employment of
an Optionee during the two (2) year period after the date of
issuance of an option to him either by reason of: (i) a discharge
for cause; or (ii) voluntary separation on the part of the
Optionee and without consent of the Company or the Subsidiary for
whom the Optionee was employed, any option or options theretofore
granted to him under this Plan, to the extent not theretofore
exercised by him, shall forthwith terminate.
(b) In the event of the termination of employment of an
Optionee (otherwise than by reason of death or retirement of the
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Optionee at his Retirement Date) by the Company or by any of the
Subsidiaries employing the Optionee at such time, any option or
options granted to him under the Plan to the extent not
theretofore exercised shall be deemed cancelled and terminated
forthwith, except that, subject to the provisions of subparagraph
(a) of this Section, such Optionee may exercise any options
theretofore granted to him, which have not then expired and which
are otherwise exercisable within the provisions of Section 7
hereof, within three (3) months after such termination. If the
employment of an Optionee shall be terminated by reason of the
Optionee's retirement at his Retirement Date by the Company or by
any of the Subsidiaries employing the Optionee at such time, the
Optionee shall have the right to exercise such option or options
held by him to the extent that such options have not expired, at
any time within three (3) months after such retirement. The
provisions of Section 7 to the contrary notwithstanding, upon
retirement, all options held by an Optionee shall be immediately
exercisable in full. The transfer of an Optionee from the employ
of the Company to a Subsidiary corporation of the Company or vice
versa, or from one Subsidiary corporation of the Company to
another, shall not be deemed to constitute a termination of
employment for purposes of this Plan.
(c) In the event that an Optionee shall die while
employed by the Company or by any of the Subsidiaries or shall
die within three (3) months after retirement on his Retirement
Date (from the Company or any Subsidiary), any option or options
granted to him under this Plan and not theretofore exercised by
him or expired shall be exercisable by the estate of the Optionee
or by any person who acquired such option by bequest or
inheritance from the Optionee in full, notwithstanding Section 7,
at any time within one (1) year after the death of the Optionee.
References herein above to the Optionee shall be deemed to
include any person entitled to exercise the option after the
death of the Optionee under the terms of this Section.
(d) In the event of the termination of employment of an
Optionee by reason of the Optionees' disability, the Optionee
shall have the right, notwithstanding the provisions of Section 7
hereof, to exercise all options held by him, to the extent that
options have not previously expired or been exercised, at any
time within one (1) year after such termination. The term
"disability" shall, for the purposes of this Plan, be defined in
the same manner as such term is defined in Section 22(e)(3) of
the Internal Revenue Code of 1986.
(e) For the purposes of this Plan, "Retirement Date"
shall mean, with respect an Optionee, the date the Optionee
actually retires from his employment with the Company or, if
applicable, the Subsidiary by whom he is employed; provided that
such date occurs on or after the date the Optionee is otherwise
entitled to retire under the terms of the retirement plan of the
Company or, if applicable, the Subsidiary by whom the Optionee is
employed.
11. Amendment and Termination of the Plan. The Board of
Directors of the Company may at any time suspend, amend or
terminate the Plan; provided, however, that except as permitted
in Section 13 hereof, no amendment or modification of the Plan
which would:
(a) increase the maximum aggregate number of shares as
to which options may be granted hereunder (except as contemplated
in Section 5); or
(b) reduce the option price or change the method of
determining the option price; or
(c) increase the time for exercise of options to be
granted or those which are outstanding beyond a term of ten (10)
years; or
(d) change the designation of the employees or class of
employees eligible to receive options under this Plan,
may be adopted unless with the approval of the holders
of a majority of the outstanding shares of Common Stock
represented at a stockholders' meeting of the Company, or with
the written consent of the holders of a majority of the
outstanding shares of Common Stock. No amendment, suspension or
termination of the Plan may, without the consent of the holder of
the option, terminate his option or adversely affect his rights
in any material respect.
12. Incentive Stock Options; Power to Establish Other
Provisions. It is intended that the Plan shall conform to and
(except as otherwise expressly set forth herein) each option
shall qualify and be subject to exercise only to the extent that
it does qualify as an "incentive stock option" as defined in
Section 422 of the Code and as such section may be amended from
time to time or be accorded similar tax treatment to that
accorded to an incentive stock option by virtue of any new
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revenue laws of the United States. The Board of Directors may
make any amendment to the Plan which shall be required so to
conform the Plan. Subject to the provisions of the Code, the
Committee shall have the power to include such other terms and
provisions in options granted under this Plan as the Committee
shall deem advisable. The grant of any options pursuant to the
terms of this Plan which do not qualify as "incentive stock
options" as defined in Section 422 of the Code is hereby approved
provided that the maximum number of shares of Common Stock of the
Company which can be issued pursuant to the terms of this Plan
(as provided for in Section 4 hereof) is not exceeded by the
grant of any such options and, to the extent that any options
previously granted pursuant to the terms of this Plan were not
"incentive stock options" within the meaning of Section 422 of
the Code, the grant of such options is hereby ratified, approved
and confirmed.
13. Maximum Annual Value of Options Exercisable.
Notwithstanding any provisions of this Plan to the contrary if:
(a) the sum of: (i) the fair market value (determined as of the
date of the grant) of all options granted to an Optionee under
the terms of this Plan which become exercisable for the first
time in any one calendar year; and (ii) the fair market value
(determined as of the date of the grant) of all options
previously granted to such Optionee under the terms of this Plan
or any other incentive stock option plan of the Company or its
subsidiaries which also become exercisable for the first time in
such calendar year; exceeds (b) $100,000; then, (c) those options
shall continue to be binding upon the Company in accordance with
their terms but, to the extent that the aggregate fair market of
all such options which become exercisable for the first time in
any one calendar year (determined as of the date of the grant)
exceeds $100,000, such options (referred to, for purposes of this
Plan, as "Non-Qualified Options") shall not be deemed to be
incentive stock options as defined in Section 422(b) of the Code.
For purposes of the foregoing, the determination of which options
shall be recharacterized as not being incentive stock options
issued under the terms of this Plan shall be made in inverse
order of their grant dates and, accordingly, the last options
received by the Optionee shall be the first options to be
recharacterized as not being incentive stock options granted
pursuant to the terms of the Plan.
14. General Provisions (a) No incentive stock option shall
be construed as limiting any right which the Company or any
parent or subsidiary of the Company may have to terminate at any
time, with or without cause, the employment of an Optionee.
(b) The Section headings used in this Plan are intended
solely for convenience of reference and shall not in any manner
amplify, limit, modify or otherwise be used in the construction
or interpretation of any of the provisions hereof.
(c) The masculine, feminine or neuter gender and the
singular or plural number shall be deemed to include the other
whenever the content so indicates or requires.
(d) No options shall be granted under the Plan after
ten (10) years from the date the Plan is adopted by the Board of
Directors of the Company or approved by the stockholders of the
Company, whichever is earlier.
15. Effective Date and Duration of the Plan. The Plan
became effective on September 21, 1993, the date the adoption of
the Plan was approved by the Board of Directors of the Company.
On November 5, 1993, as required by Section 422 of the Code, the
Plan was approved by the Stockholders of the Company. The Plan
will terminate on September 20, 2003; provided however, that the
termination of the Plan shall not be deemed to modify, amend or
otherwise affect the terms of any options outstanding on the date
the Plan terminates.
A-8
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this Plan
by and on behalf of the Company on and as of the 20th day of May,
1997.
GIBRALTAR STEEL CORPORATION
By: /s/ Walter T. Erazmus
Walter T. Erazmus
Executive Vice President
DATE ADOPTED BY BOARD OF DIRECTORS: September 21, 1993
DATE APPROVED BY STOCKHOLDERS: November 5, 1993
TERMINATION DATE: September 21, 2003
A-9
<PAGE>
PROXY
GIBRALTAR STEEL CORPORATION
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 19, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints BRIAN J. LIPKE, NEIL E. LIPKE,
and WALTER T. ERAZMUS and each or any of them, attorneys and
proxies, with full power of substitution, to vote at the Annual
Meeting of Stockholders of GIBRALTAR STEEL CORPORATION (the
"Company") to be held at the Company's offices at 3556 Lake Shore
Road, Buffalo, New York, on May 19, 1998 at 10:00 a.m., local
time, and any adjournment(s) thereof revoking all previous
proxies, with all powers the undersigned would possess if
present, to act upon the following matters and upon such other
business as may properly come before the meeting or any
adjournment(s) thereof.
1 ELECTION OF DIRECTORS
For Class II Director - Neil E. Lipke
FOR [ ] WITHHOLD AUTHORITY [ ]
For Class II Director - Gerald S. Lippes
FOR [ ] WITHHOLD AUTHORITY [ ]
2. PROPOSAL TO APPROVE THE PROPOSED THIRD AMENDMENT AND
RESTATEMENT OF THE GIBRALTAR STEEL CORPORATION INCENTIVE
STOCK OPTION PLAN
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
DIRECTED HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE NOMINEES AND PROPOSALS LISTED ABOVE.
Dated: ________, 1998
_____________________________________________
Signature
_____________________________________________
Signature if held jointly
Please sign exactly as name appears. When shares
are held by joint tenants, both should sign.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such. If a corporation, please sign in full
corporate name by President or other authorized
officer. If a partnership, please sign a partnership
name by authorized person. PLEASE MARK, SIGN, DATE
AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
