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Horsehead Holding DEF 14A 2009 UNITED STATES
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 14A
(Rule 14a-101) INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant þ
Filed by a Party other than the Registrant o Check the appropriate box:
HORSEHEAD
HOLDING CORP.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
April 2,
2009
To our Stockholders:
You are cordially invited to attend the Horsehead Holding Corp.
annual meeting of stockholders at 11:00 a.m. local time on
May 14, 2009 at the InterContinental Chicago, 505 North
Michigan Avenue, Chicago, Illinois 60611. The attached Notice of
Annual Meeting and Proxy Statement describes all known items to
be acted upon by stockholders at the meeting and describes
certain other details related to the Meeting.
It is important that your shares are represented at the annual
meeting, whether or not you plan to attend. To ensure your
shares will be represented, we ask that you vote your shares by
completing, signing, dating and returning the enclosed proxy
card by mail, or you may vote by telephone or electronically
through the Internet, as further described on the proxy card.
Please vote your shares as soon as possible. This is your
annual meeting and your participation is important.
If you are a registered stockholder and plan to attend the
annual meeting, you may be required to show evidence of your
stockholdings to gain entry to the meeting. If you hold shares
through a broker or other nominee, you will be required to
present a current statement from that institution showing a
Horsehead stockholding or the non-voting portion of the voting
instruction form that you may receive through that entity.
Please note that the document evidencing your stockholdings to
be used to gain entry to the meeting is non-transferable.
Please vote your shares promptly and join us at the meeting.
Sincerely,
James M. Hensler
President and Chief Executive Officer
To our Stockholders:
The 2009 annual meeting of stockholders of Horsehead Holding
Corp. will be held at the InterContinental Chicago, 505 North
Michigan Avenue, Chicago, Illinois 60611, on May 14, 2009,
beginning at 11:00 a.m. local time. At the meeting, the
holders of the Company’s outstanding common stock will act
on the following matters:
(1) the election of two Class III directors, each to
serve a term of three years; and
(2) any other business as may properly come before the
meeting or any adjournment or postponement thereof.
Stockholders of record at the close of business on April 1,
2009 are entitled to notice of and to vote at the annual meeting
and any postponements or adjournments thereof.
Whether or not you expect to be present at the meeting, please
vote your shares by following the instructions on the enclosed
proxy card or voting instruction card. If your shares are held
in the name of a bank, broker or other recordholder, their
voting procedures should be described on the voting form they
sent you. Any person voting by proxy has the power to revoke it
at any time prior to its exercise at the meeting in accordance
with the procedures described in the accompanying proxy
statement.
Please note that space limitations make it necessary to limit
attendance to stockholders . Admission to the meeting will be on
a first-come, first-served basis. Registration for the meeting
will begin at 10:30 a.m. local time, and seating will begin
at 10:45 a.m. local time. You may be required to show
evidence of your stockholdings. If you hold shares through a
broker or other nominee, you will be required to present a
current statement from that institution showing a Horsehead
stockholding or the non-voting portion of the voting instruction
form that you may receive through that entity. Please note that
the document evidencing your stockholdings to be used to gain
entry to the meeting is non-transferable. Cameras (including
cellular phones with photographic capabilities) and recording
devices will not be permitted at the meeting.
By order of the Board of Directors,
Ali Alavi
Vice President — Corporate Administration, General Counsel and Secretary
April 2, 2009
Pittsburgh, Pennsylvania
4955
Steubenville Pike
Suite 405 Pittsburgh, Pennsylvania 15205 ANNUAL MEETING OF STOCKHOLDERS To Be Held May 14, 2009
The Board of Directors (the “Board”) of Horsehead
Holding Corp. (the “Company” or “Horsehead”)
is soliciting proxies from its stockholders to be used at the
annual meeting of stockholders to be held on May 14, 2009
(the “Annual Meeting”), beginning at 11:00 a.m.
local time, at the InterContinental Chicago, 505 North Michigan
Avenue, Chicago, Illinois 60611, and at any postponements or
adjournments thereof. This Proxy Statement contains information
related to the Annual Meeting. The notice of annual meeting, a
proxy card, this Proxy Statement and the Company’s Annual
Report on
Form 10-K
filed with the Securities and Exchange Commission
(“SEC”) on March 16, 2008 for the fiscal year
ended December 31, 2008 (the “2008 Annual
Report”) are being mailed to stockholders on or about
April 9, 2009.
ABOUT THE
ANNUAL MEETING
Our Board of Directors is soliciting proxies for the 2009 annual
meeting of stockholders. You are receiving a proxy statement
because you owned shares of our common stock on April 1,
2009, and that entitles you to vote at the Annual Meeting. By
use of a proxy, you can ensure that your vote is counted at the
Annual Meeting whether or not you attend the Annual Meeting.
This proxy statement describes the matters on which we would
like you to vote and provides information on those matters so
that you can make an informed decision.
The notice of annual meeting, a proxy card, this Proxy Statement
and the 2008 Annual Report are being mailed to stockholders on
or about April 9, 2008.
The information in this Proxy Statement relates to the proposals
to be voted on at the Annual Meeting, the voting process, our
Board, and Board committees, the compensation of directors and
executive officers for fiscal 2008 and other information that
the SEC requires us to provide annually to our stockholders.
Stockholders can access our 2008 Annual Report, our other
filings with the SEC and our corporate governance and other
information on the investor relations page of our website at
www.horsehead.net.
Stockholders may request an additional free copy of our 2008
Annual Report from:
Horsehead Holding Corp.
Attn: General Counsel 4955 Steubenville Pike Suite 405 Pittsburgh, Pennsylvania 15205 (724) 774-1020
We will also furnish any exhibit to the 2008 Annual Report if
specifically requested.
At the Annual Meeting, stockholders will act upon the matters
outlined in the accompanying notice of annual meeting. In
addition, management will report on our fiscal 2008 performance
and respond to appropriate questions from stockholders.
Only stockholders of record at the close of business on
April 1, 2009, the “Record Date” for the Annual
Meeting, are entitled to receive notice of and to participate in
the Annual Meeting. If you were a stockholder of record on the
Record Date, you will be entitled to vote all of the shares that
you held on that date at the Annual Meeting, or any
postponements or adjournments of the Annual Meeting.
You will be entitled to one vote for each outstanding share of
Horsehead common stock you owned as of the close of business on
the Record Date on each matter considered at the Annual Meeting.
As of the close of business on the Record Date, there were
[35,253,803] shares of the Company’s common stock
outstanding and eligible to vote. There is no cumulative voting.
Subject to space availability, all stockholders as of the Record
Date, or their duly appointed proxies, may attend the Annual
Meeting. Registration will begin at 10:30 a.m. local time,
and seating will begin at 10:45 a.m. local time. If you
attend, please note that you may be asked to present proof of
your stockholdings and valid identification. Cameras (including
cell phones with photographic capabilities) and recording
devices will not be permitted at the Annual Meeting.
Please note that if you hold your shares in “street
name” (that is, through a broker, bank or other nominee),
you will need to bring a copy of a brokerage statement
reflecting your stock ownership as of the Record Date and check
in at the registration desk at the Annual Meeting.
Please let us know if you plan to attend the Annual Meeting by
marking the appropriate box on the enclosed proxy card.
The presence at the Annual Meeting, in person or by proxy, of
the holders of a majority of the aggregate voting power of the
common stock outstanding on the Record Date will constitute a
quorum, permitting the conduct of business at the Annual
Meeting. As of the close of business on the Record Date,
35,253,803 shares of common stock, representing the same
number of votes, were outstanding. Thus, the presence, in person
or by proxy, of the holders of common stock representing at
least 17,626,902 votes will be required to establish a quorum.
Proxies received but marked as abstentions will be included in
the calculation of the number of votes considered to be present
at the Annual Meeting.
If you are a holder of record (that is, your shares are
registered in your own name with our transfer agent), you can
vote either in person at the Annual Meeting or by proxy without
attending the Annual Meeting. We urge you to vote by proxy even
if you plan to attend the Annual Meeting so that we will know as
soon as possible that enough votes will be present for us to
hold the Annual Meeting. If you attend the Annual Meeting in
person, you may vote at the Annual Meeting and your proxy will
not be counted. You can vote by proxy by any of the following
methods.
Voting by Proxy Card. Each stockholder may
vote by proxy by using the enclosed proxy card. When you return
a proxy card that is properly signed and completed, the shares
of common stock represented by your proxy will be voted as you
specify on the proxy card.
Voting by Telephone or Through the
Internet. If you are a registered stockholder
(that is, if you own common stock in your own name and not
through a broker, bank or other nominee that holds common stock
for your account in a “street name” capacity), you may
vote by proxy by using either the telephone or Internet methods
of voting. Proxies submitted by telephone or through the
Internet must be received by 11:59 p.m., Eastern Daylight
Savings time, on May 13, 2009. Please see the proxy card
provided to you for instructions on how to access the telephone
and Internet voting systems.
If you hold your shares in “street name,” you must
either direct the bank, broker or other record holder of your
shares as to how to vote you shares, or obtain a proxy from the
bank, broker or other record holder to vote at the Annual
Meeting. Please refer to the voter instruction cards used by
your bank, broker or other record holder for specific
instructions on methods of voting, including by telephone or
using the Internet.
If you return the proxy card but you do not indicate your voting
preferences, then the individuals named on the proxy card will
vote your shares in accordance with the recommendations of the
Board. The Board and management do not now intend to present any
matters at the Annual Meeting other than those outlined in the
notice of annual meeting. Should any other matter requiring a
vote of stockholders arise, stockholders returning the proxy
card confer upon the individuals named on the proxy card
discretionary authority to vote the shares represented by such
proxy on any such other matter in accordance with their best
judgment.
Yes. If you are a stockholder of record, you may revoke or
change your vote at any time before the proxy is exercised by
filing with the Secretary of the Company a notice of revocation
or another proxy bearing a later date or by attending the Annual
Meeting and voting in person. In either case, the powers of the
proxy holders will be suspended if you attend the Annual Meeting
in person and so request, although attendance at the Annual
Meeting will not by itself revoke a previously granted proxy.
We are soliciting this proxy on behalf of our Board of Directors
by mail and will pay all expenses associated with this
solicitation. In addition to mailing these proxy materials,
certain of our officers and other employees may, without
compensation other than their regular compensation, solicit
proxies by further mailing or personal conversations, or by
telephone, facsimile or other electronic means. We will also,
upon request, reimburse brokers and other persons holding stock
in their names, or in the names of nominees, for their
reasonable out-of-pocket expenses for forwarding proxy materials
to the beneficial owners of our common stock and for obtaining
proxies.
The cost of this solicitation will be borne by the Company.
Solicitation will be made by mail, by telecopy and telephone and
personally by a few officers and regular employees of the
Company who will not receive additional compensation for such
solicitation. Brokers, banks and other nominees will, upon
request, be reimbursed for out-of-pocket expenses incurred in
obtaining proxies or authorizations from the beneficial owners
of our common stock. In addition, the Company has engaged
Broadridge Financial Solutions, Inc. to assist in the general
distribution of this Proxy Statement and the 2008 Annual Report
and the tabulation of votes.
Unless you give other instructions on your proxy card, the
persons named as proxy holders on the proxy card will vote in
accordance with the recommendations of the Board. The
Board’s recommendation is set forth together with the
description of each item in this Proxy Statement. In summary,
the Board recommends a vote FOR each of the proposals.
To the knowledge of the Company and its management, stockholders
will vote only on the matters described in this Proxy Statement.
However, if any other matters properly come before the Annual
Meeting, the persons named as proxies for stockholders will vote
on those matters in the manner they consider appropriate.
Election of Directors. The two director
nominees who receive the highest number of properly executed
votes will be elected as directors, even if those nominees do
not receive a majority of the votes cast. Each share of our
common stock is entitled to one vote for each of the director
nominees. A properly executed proxy marked “withhold
authority” with respect to the election of one or more
directors will not be voted with respect to the director or
directors indicated, although it will be counted for purposes of
determining whether there is a quorum.
A properly executed proxy marked “abstain” with
respect to any matter will not be voted, although it will be
counted for purposes of determining whether there is a quorum.
Accordingly, an abstention will have the effect of a negative
vote.
In the election of directors, you may vote “FOR” all
or some of the nominees or your vote may be “WITHHELD”
with respect to one or more of the nominees. You may not
cumulate your votes for the election of directors.
For the other items of business, you may vote “FOR,”
“AGAINST” or “ABSTAIN.” If you elect to
“ABSTAIN,” the abstention has the same effect as a
vote “AGAINST.” If you provide specific instructions
with regard to certain items, your shares will be voted as you
instruct on such items.
If you hold shares beneficially in street name and do not
provide your broker with voting instructions, your shares may
constitute “broker non-votes.” Generally, broker
non-votes occur on a matter when a broker is not permitted to
vote on that matter without instructions from the beneficial
owner and instructions are not given. In tabulating the voting
result for any particular proposal, shares that constitute
broker non-votes are not considered votes cast on that proposal.
Thus, broker non-votes will not affect the outcome of any matter
being voted on at the Annual Meeting, assuming that a quorum is
obtained. Abstentions are considered votes cast and thus have
the same effect as votes against the matter. The Company has
supplied copies of its proxy materials for the Annual Meeting to
the broker, bank or other nominee holding your shares of record,
and they have the responsibility to send these proxy materials
to you.
If you are a beneficial owner and your broker, bank or other
nominee holds your shares in its name, the broker, bank or other
nominee is permitted to vote your shares on the election of
directors, even if the broker, bank or other nominee does not
receive voting instructions from you.
If you vote by proxy, and if unforeseen circumstances make it
necessary for the Board to substitute another person for a
nominee, the individuals named on the proxy card will vote your
shares for that other person.
You may receive more than one set of voting materials, including
multiple copies of this Proxy Statement and multiple proxy cards
or voting instruction cards. For example, if you hold your
shares in more than one brokerage account, you may receive a
separate voting instruction card for each brokerage account in
which you hold shares. If you are a stockholder of record and
your shares are registered in more than one name, you will
receive more than one proxy card. Please vote your shares
applicable to each proxy card and voting instruction card that
you receive.
The Company intends to announce the preliminary voting results
at the Annual Meeting and publish the final results in its
quarterly report on
Form 10-Q
for the quarter ending June 30, 2009.
You may contact the Corporate Secretary at our principal
executive offices for a copy of the relevant by-law provisions
regarding the requirements for making stockholder proposals and
nominating director candidates. Our by-laws are available also
on our website at www.horsehead.net.
A list of the stockholders of the Company entitled to attend and
vote at the Annual Meeting will be available for viewing during
normal business hours during the ten days preceding the date of
the Annual Meeting at the Company’s offices located at:
4955 Steubenville Pike
Suite 405 Pittsburgh, Pennsylvania 15205
The list will be available for viewing also at the Annual
Meeting. You must be a stockholder of the Company and present
valid identification to view the list.
This proxy statement and our 2008 Annual Report to stockholders
are available at www.proxyvote.com.
Our Certificate of Incorporation provides that the number of
directors that constitute the Board of Directors shall be fixed
from time to time by resolution adopted by the affirmative vote
of a majority of the total number of directors then in office.
The number of authorized directors as of the date of this Proxy
Statement is five. We have three classes of directors and each
class is required by our by-laws to be as equal as possible in
number. One class is to be elected at each annual meeting of
stockholders. Currently, there are one Class I director,
two Class II directors and two Class III directors. At
the 2009 annual meeting, to which this Proxy Statement relates,
the term of the Class III directors will expire. You are
being asked to vote to elect two directors to Class III
each to serve for a three-year term expiring in 2012.
We will vote your shares as you specify on the enclosed proxy or
voting instruction card. If you do not specify how you want your
shares voted, we will vote them FOR the election of the nominees
listed below. If unforeseen circumstances (such as death or
disability) make it necessary for us to substitute another
person for any nominee, we will vote your shares FOR that other
person. If you wish to withhold your vote from any nominee, you
may so indicate on the proxy card. Proxies cannot be voted for a
greater number of persons than the number of nominees named. The
two nominees for Class III directors receiving the greatest
number of votes will be elected as a directors.
The nominees for director have consented to serve, if elected,
and we have no reason to believe that the nominees will be
unable to serve. If any nominee named herein for election as a
director should for any reason become unavailable to serve prior
to the Annual Meeting, the Board will, prior to the Annual
Meeting, (i) reduce the size of the Board to eliminate the
position for which that person was nominated, (ii) nominate
a new candidate in place of such person and vote in favor of the
new candidate all shares represented by stockholder proxies
received
by the Board, unless authority to vote for all candidates
nominated by the Board is withheld, or (iii) leave the
position vacant to be filled at a later time.
Our Board has nominated the persons named below for election as
Class III directors. Following are the age, principal
occupation during the past five years, and certain other
information of the nominee. The information presented below for
the director nominees has been furnished to the Company by the
director nominees.
T. Grant John, 70, Director, was appointed to our
Board in May 2007. Since 2003, Mr. John has served as the
principal of T.G. John & Associates, Inc., a strategy,
search and turnaround consulting firm focused on the primary
metals and metalworking industries. From 1999 to 2003,
Mr. John was the president and chief executive officer of
Special Metals Corporation, a producer of nickel and cobalt
alloys. Prior to 1999 and beginning in 1966, Mr. John
served in various executive and management roles for companies
in the metals industry. Mr. John earned B.A.Sc. and Ph.D.
degrees in metallurgical engineering at the University of
British Columbia.
Bryan D. Rosenberger, 58, Director, was appointed to our
Board in May 2007. Mr. Rosenberger is Of Counsel to the law
firm of Eckert Seamans Cherin & Mellott, LLC, engaging
in corporate and securities law matters on behalf of both
publicly and privately held businesses. Mr. Rosenberger has
previously served as Chairman of Eckert Seamans
Cherin & Mellott, LLC’s Business Division and as
a member of that firm’s Executive Committee and Board of
Directors. Mr. Rosenberger has been Of Counsel at Eckert
Seamans Cherin & Mellott, LLC since 2006 and was a
partner/member from 1983 to 2006. Mr. Rosenberger received
a BS in Economics from Juniata College in 1971 and a JD from the
College of William and Mary Marshall-Wythe School of Law in 1974.
As of the date of this Proxy Statement, the Company knows of no
business that will be presented for consideration at the Annual
Meeting other than the items referred to above. If any other
matter is properly brought before the Annual Meeting for action
by stockholders, proxies in the enclosed form returned to the
Company will be voted in accordance with the recommendation of
the Board or, in the absence of such a recommendation, in
accordance with the best judgment of the proxy holder.
BOARD OF
DIRECTORS AND CORPORATE GOVERNANCE
Set forth below is information concerning our directors,
executive officers and key employees.
James M. Hensler, Chairman of the Board of Directors,
President and Chief Executive Officer, joined us in April 2004.
He has over 29 years of experience working in the metals
industry. From 2003 to April 2004, Mr. Hensler was a
consultant to various companies in the metals industry. From
1999 to 2003, Mr. Hensler was Vice President of Global
Operations and Vice President and General Manager of the
Huntington Alloys Business Unit for Special Metals Corp., a
leading international manufacturer of high performance nickel
and cobalt alloys. Prior to that, Mr. Hensler was the
Executive Vice President for Austeel Lemont Co., General Manager
of Washington Steel Co. and Director of Business Planning for
Allegheny Teledyne Inc. He received a BS in Chemical Engineering
from the University of Notre Dame in 1977, an MSE in Chemical
Engineering from Princeton University in 1978 and an MBA from
the Katz Graduate School of Business at the University of
Pittsburgh in 1987.
Robert D. Scherich, Vice President and Chief Financial
Officer, joined us in July 2004. From 1996 to 2004,
Mr. Scherich was the Chief Financial Officer of Valley
National Gases, Inc. Prior to that, he was the Controller and
General Manager at Wheeling-Pittsburgh Steel Corp. and an
accountant at Ernst & Whinney. Mr. Scherich
received a BS in Business Administration from The Pennsylvania
State University in 1982.
Robert Elwell, Vice President — Operations,
joined us in June 2006 with 31 years of industry
experience. For the previous eight years, he was the President
of Greenville Metals, a division of Precision Castparts
Corporation. Previous positions include Vice President of
Manufacturing for Cannon-Muskegon Corporation (also a Precision
Castparts Corporation), Vice President of Quality and Technology
for Freedom Forge Corporation, Manufacturing Manager for Haynes
International, Inc. and several operating and technical
positions at Lukens Steel Co. Mr. Elwell has a BS in
Metallurgical Engineering from Lafayette College in 1975 and an
MBA from Widener University in 1979.
James A. Totera, Vice President — Sales and
Marketing, joined us in 1997. Prior to that, he was the Vice
President of Sales for Steel Mill Products, where he worked in,
among other things, electric arc furnace (“EAF”) dust
recycling and also spent over 15 years working in sales
positions, including as General Manager of Sales, at Insul
Company. Mr. Totera received a BA in Economics,
Administrative Management Science and Psychology from Carnegie
Mellon University in 1979.
Thomas E. Janeck, Vice President — Environment,
Health and Safety, has worked for us and our predecessors since
1964. Prior to his current position, Mr. Janeck served in a
number of capacities and was most recently Vice President of
Environmental Services and Director of Regulatory Affairs.
Mr. Janeck is a member of the Board of Directors of the
National Mining Association and serves as Chairman of its
Environment Committee. Mr. Janeck received a BS in Chemical
Engineering from the University of Pittsburgh in 1967.
Ali Alavi, Vice President — Corporate
Administration, General Counsel and Secretary, joined us in
1996. Mr. Alavi previously served as our
Director & Counsel of Environment, Health &
Safety and Director of Environmental Performance. Prior to
joining us, Mr. Alavi worked as Assistant General Counsel
of Clean Sites, Inc., Senior Regulatory Analyst of the American
Petroleum Institute and Project Manager/Engineer for the
U.S. Army Toxic & Hazardous Materials Agency.
Mr. Alavi received a BA in Geography/Environmental Studies
from the University of Pittsburgh in 1983, an MS in Petroleum
Engineering from the University of Pittsburgh School of
Engineering in 1985 and a JD from the University of Maryland Law
School in 1993.
Daryl K. Fox, Vice President — Human Resources,
joined us in October 2005. He has over 35 years of Human
Resources experience working in the metals and transportation
industries. Prior to joining us, from August 2004 to February
2005, Mr. Fox served as a consultant to Allegheny
Technologies Incorporated. Previously, Mr. Fox served as
Vice President — Human Resources for J&L
Specialty Steel, LLC, a producer of stainless steel, from June
1993 until it was acquired by Allegheny Technologies
Incorporated in July 2004. Mr. Fox received a BA in
Sociology from Duke University in 1973.
John van Roden was appointed to our Board in April 2007.
From 2006 to 2007, Mr. van Roden served as Executive Vice
President of P.H. Glatfelter Company, an New York Stock Exchange
(“NYSE”)-listed producer of engineered paper products,
and served as Executive Vice President and Chief Financial
Officer of P.H. Glatfelter Company from 2003 to 2006. From 1998
to 2003, Mr. van Roden was Senior Vice President and Chief
Financial Officer of Conectiv Corp. From 1992 to 1998, Mr. van
Roden was Senior Vice President and Chief Financial Officer of
Lukens Inc. Mr. van Roden is a director of (i) H.B. Fuller
Company, an NYSE-listed global manufacturer and marketer of
adhesives and specialty chemical products, (ii) PVG GP,
LLC, the general partner of Penn Virginia G.P. Holdings, L.P.,
an NYSE-listed limited partnership engaged in the management of
coal properties and the gathering and processing of natural gas,
and (iii) Airgas, Inc., an NYSE-listed distributor of
industrial, medical and specialty gases and welding, safety and
related products. Mr. van Roden received a BA in Economics from
Denison University in 1971 and an MBA from Drexel University in
1974.
T. Grant John was appointed to our Board in May
2007. Since 2003, Mr. John has served as the principal of
T.G. John & Associates, Inc., a strategy, search and
turnaround consulting firm focused on the primary metals and
metalworking industries. From 1999 to 2003, Mr. John was
the president and chief executive officer of Special Metals
Corporation, a producer of nickel and cobalt alloys. Prior to
1999 and beginning in 1966, Mr. John served in various
executive and management roles for companies in the metals
industry. Mr. John earned B.A.Sc. and Ph.D. degrees in
metallurgical engineering at the University of British Columbia.
Bryan D. Rosenberger was appointed to our Board in May
2007. Mr. Rosenberger is Of Counsel to the law firm of
Eckert Seamans Cherin & Mellott, LLC, engaging in
corporate and securities law matters on behalf of both publicly
and privately held businesses. Mr. Rosenberger has
previously served as Chairman of Eckert Seamans
Cherin & Mellott, LLC’s Business Division and as
a member of that firm’s Executive Committee and Board of
Directors. Mr. Rosenberger has been Of Counsel at Eckert
Seamans Cherin & Mellott, LLC since 2006 and was a
partner/member from 1983 to 2006. Mr. Rosenberger received
a BS in Economics from Juniata College in 1971 and a JD from the
College of William and Mary Marshall-Wythe School of Law in 1974.
Jack Shilling, was appointed to our Board in September
2007. From July 2001 through April 2007, Mr. Shilling
served as an Executive Vice President and Chief Technology
Officer of Allegheny Technologies Incorporated, an NYSE-listed
producer of specialty metals (“ATI”), where his
responsibilities included working closely with several
individual ATI businesses on strategic growth opportunities.
Prior to such positions with ATI, beginning in 1973,
Mr. Shilling worked for a subsidiary of ATI, Allegheny
Ludlum Corporation, of which he became president in 1998 after
holding positions of increasing responsibility in technical and
operations management. He then became president of the high
performance metals segment of ATI in 2000. Mr. Shilling has
served also as the chairman of the Specialty Steel Industry of
North America, a trade association representing the producers of
stainless steel and other specialty metals in North America.
Mr. Shilling received a BA in Physics from
Franklin & Marshall College in 1965, an MS in Physics
from Cornell University in 1967 and a PhD in Metallurgical
Engineering from the University of Pittsburgh in 1975.
Our Board of Directors consists of five members. Our Certificate
of Incorporation provides for a classified board of directors
consisting of three classes of directors, with directors in each
class serving staggered three-year terms. As a result,
stockholders elect a portion of our Board each year.
Class I directors’ terms expire at the annual meeting
of stockholders to be held in 2010, Class II
directors’ terms expire at the annual meeting of
stockholders being held in 2011, and Class III
directors’ terms expire at the annual meeting of
stockholders to be held in 2009, to which this Proxy Statement
relates. The Class I director is Mr. Hensler, the
Class II directors are Messrs. van Roden and Shilling and
the Class III directors are Messrs. John and
Rosenberger.
At each annual meeting of stockholders, the successors to
directors whose terms will then expire will be elected to serve
from the time of election until the third annual meeting
following election. Any vacancies or additional directorships
resulting from an increase in the number of directors may only
be filled by a majority vote of the directors then in office.
Any additional directorships resulting from an increase in the
number of directors will be distributed among the three classes
so that, as nearly as possible, each class will consist of
one-third of the total number of directors. The division of our
Board into three classes with staggered terms may delay or
prevent a change of our management or a change in control.
The composition, duties and responsibilities of the committees
of our Board are set forth below. Our Board adopted a written
charter for each of its committees, each of which is available
on the investor relations page of our website at
www.horsehead.net. Committee members will hold office for a term
of one year. In the future, our Board may establish other
committees, as it deems appropriate, to assist with its
responsibilities.
Audit Committee. The audit committee is
responsible for (1) selecting the independent auditors,
(2) approving the overall scope of the audit,
(3) assisting the Board in monitoring the integrity of our
financial statements, the independent auditors’
qualifications and independence, the performance of the
independent auditors and our internal audit function and our
compliance with legal and regulatory requirements,
(4) annually reviewing an independent auditors’ report
describing the auditing firms’ internal quality-control
procedures and any material issues raised by the most recent
internal quality-control review, or peer review, of the auditing
firm, (5) discussing the annual audited financial and
quarterly statements with management and the independent
auditor, (6) discussing earnings press releases, as well as
financial information and earnings guidance provided to analysts
and rating agencies from time to time, (7) discussing
policies with respect to risk assessment and risk management,
(8) meeting separately, periodically, with management,
internal auditors and the independent auditor,
(9) reviewing with the independent auditor any audit
problems or difficulties and management’s response,
(10) setting clear hiring policies for employees or former
employees of the independent auditors, (11) handling such
other matters that are specifically delegated to the audit
committee by the Board from time to time, (12) reviewing
related party transactions and (13) reporting regularly to
the full Board.
Our audit committee consists of Mr. van Roden, as chairman, and
Messrs. Rosenberger, John and Shilling. Our Board has
determined that each of these members is an independent director
according to the rules and regulations of the SEC and the NASDAQ
Stock Market and that Mr. van Roden qualifies as an “audit
committee financial expert” as such term is defined in
Item 407(d) of
Regulation S-K.
During 2008, our audit committee held nine meetings.
Compensation Committee. The compensation
committee is responsible for (1) reviewing key employee
compensation policies, plans and programs, (2) reviewing
and approving the compensation of our executive officers,
(3) reviewing and approving employment contracts and other
similar arrangements between us and our executive officers,
(4) reviewing and consulting with our Chief Executive
Officer on the selection of officers and evaluation of executive
performance and other related matters, (5) administering
our stock plans and other incentive compensation plans and
(6) such other matters that are specifically delegated to
the compensation committee by the Board from time to time. Our
compensation committee consists of Mr. John, as chairman,
and Messrs. Rosenberger, van Roden and Shilling, each of
whom satisfies the independence requirements of the NASDAQ
Marketplace Rules. During 2008, our compensation committee held
seven meetings.
Nominating and Corporate Governance
Committee. Our nominating and corporate
governance committee’s purpose is to assist our Board by
identifying individuals qualified to become members of our Board
consistent with criteria set by our Board and to develop our
corporate governance principles. This committee’s
responsibilities include: (1) evaluating the composition,
size and governance of our Board and its committees and making
recommendations regarding future planning and the appointment of
directors to our committees, (2) establishing a policy for
considering stockholder nominees for election to our Board,
(3) evaluating and recommending candidates for election to
our Board, (4) overseeing the performance and
self-evaluation process of our Board and developing continuing
education programs for our directors, (5) reviewing our
corporate governance principles and providing recommendations to
the Board regarding possible changes and (6) reviewing and
monitoring compliance with our code of ethics and our insider
trading policy. Our nominating and corporate governance
committee consists of Mr. Rosenberger, as chairman, and
Messrs. John, van Roden and Shilling, each of whom
satisfies the independence requirements of the NASDAQ
Marketplace Rules. During 2008, our nominating and corporate
governance committee held two meetings.
The nominating and corporate governance committee seeks a
diverse group of director candidates who possess the background,
skills and expertise to make a significant contribution to the
Board, to the Company and our stockholders. Desired qualities to
be considered include: high-level leadership experience and
significant accomplishment in business or administrative
activities; breadth of knowledge about issues affecting the
Company; proven ability and willingness to contribute special
competencies to Board activities; personal integrity; loyalty to
the Company and concern for its success and welfare; willingness
to apply sound and independent business judgment; awareness of a
director’s vital role in assuring the Company’s good
corporate citizenship and corporate image; no present conflicts
of interest; availability for meetings and consultation on
Company matters; enthusiasm about the prospect of serving;
willingness to assume broad fiduciary responsibility; and
willingness to become a Company stockholder.
The nominating and corporate governance committee will consider
all nominees for election as directors of the Company, including
all nominees recommended by stockholders, in accordance with the
mandate contained in its charter. The Company has not paid a fee
to any third party to identify or assist in identifying or
evaluating potential nominees. In evaluating candidates, the
nominating and corporate governance committee reviews all
candidates in the same manner, regardless of the source of the
recommendation. The policy of the nominating and corporate
governance committee is to consider individuals recommended by
stockholders for nomination as a director in accordance with the
procedures described under “Stockholder Proposals and
Director Nominations for the 2010 Meeting.”
The Board held twelve meetings during 2008. Directors are
expected to attend Board meetings and meetings of committees on
which they serve and to spend time as needed and meet as
frequently as necessary to properly discharge their
responsibilities. Each director attended at least 95% of the
aggregate number of meetings of the Board and the applicable
committees of the Board held during 2008.
All directors and director nominees are encouraged to attend the
annual meeting of the stockholders. All of our then directors
attended our 2008 annual meeting of stockholders in person. All
are currently expected to be in attendance at the Annual Meeting.
Certain rules of The Nasdaq Global Select Market require that a
majority of the members of the Board be “independent
directors” and that the audit committee, the compensation
committee and the nominating and corporate governance committee
of the Board each comprise only “independent
directors,” in each case as defined under the NASDAQ
Marketplace Rules.
Based upon the information submitted by each of our directors,
and following the recommendation of the nominating and corporate
governance committee, the Board has determined that each of our
directors, except
Mr. Hensler, our President and Chief Executive Officer, and
including the director nominees standing for election,
Messrs. John and Rosenberger, has no relationship which, in
the opinion of the Board, would interfere with the exercise of
independent judgment in carrying out the responsibilities of a
director and that each, except Mr. Hensler, is an
“independent director” as defined in NASDAQ
Marketplace Rule 4200(a)(15) and
Rule 10A-3
promulgated under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”). In determining the
independence of our directors, the Board has adopted
independence standards that mirror exactly the criteria
specified by applicable laws and regulations of the SEC and the
rules of The Nasdaq Global Select Market.
The Company requires the non-management directors to meet in
executive sessions on a periodic basis without management. The
presiding director, for purposes of leading these meetings, is
the chairman of the nominating and corporate governance
committee. In 2008, our non-management directors held seven
executive sessions.
Stockholders may send communications to the Company’s
directors as a group or individually, by writing to those
individuals or the group:
c/o the
Secretary of Horsehead Holding Corp., 4955 Steubenville Pike,
Suite 405, Pittsburgh, Pennsylvania 15205. The
Company’s Secretary will review all correspondence received
and will forward all correspondence that is relevant to the
duties and responsibilities of the Board or the business of the
Company to the intended director(s).
The Board has adopted a policy for submitting concerns regarding
the Company’s accounting or auditing matters. Reports may
be sent to the audit committee through one of the following
means: (1) telephoning the Secretary of the Company,
(2) writing to: Audit Committee,
c/o the
Secretary of Horsehead Holding Corp., 4955 Steubenville
Pike, Suite 405, Pittsburgh, Pennsylvania 15205, or
(3) emailing the audit committee, by way of the Secretary
of Horsehead Holding Corp., at aalavi@horsehead.net. In each
case, reports will be received by the Company’s Secretary
who will forward the message to the audit committee. In
addition, the Company has engaged The Network to provide an
Independent Accounting, Internal Accounting Controls and
Auditing Matters Hotline, which can be reached through one of
the following means: (1) by telephone at
(866) 835-6347,
which is available 24 hours per day, 365 days per year
for leaving a recorded message; (2) by writing to The
Network, ATTN: Horsehead Corporation, 333 Research Court,
Norcross, GA 30092; or (3) by
e-mail via
the website
www.tnwinc.com/reportline
or the
e-mail
address Reportline@tnwinc.com. The confidentiality of all
reports will be maintained to the extent consistent with law.
No member of our compensation committee is an officer or
employee of us, and no member has been an officer or employee of
us at any prior time. There are no interlocking relationship
between any of our executive officers and compensation
committee, on the one hand, and the executive officers and
compensation committee of any other companies, on the other hand.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Our legal and finance departments bear primary responsibility
for developing and implementing processes and controls to obtain
information from our directors, executive officers and
significant stockholders regarding related-party transactions
and then determining, based on the facts and circumstances,
whether we or a related-party has a direct or indirect material
interest in these transactions. Our audit committee is
responsible for the review, approval or ratification of
“related-person transactions” between us or our
subsidiaries and related persons. “Related person”
refers to a person or entity who is, or at any point since the
beginning of the last fiscal year was, a director, officer,
nominee for director or 5% stockholder of us or is or was an
immediate family member of such person or entity. The audit
committee does not have a written policy regarding the approval
of related party transactions. The audit
committee applies its review procedures as a part of its
standard operating procedures. In the course of its review and
approval or ratification of a related-party transaction, the
audit committee will consider:
Any member of the audit committee who is a related party with
respect to a transaction under review may not participate in the
deliberations or vote on the approval or ratification of the
transaction. However, such a director may be counted in
determining the presence of a quorum at a meeting of the audit
committee at which the transaction is considered.
Since January 1, 2008, we have not been a party to, and we
have no plans to be a party to, any transaction or series of
similar transactions in which the amount involved exceeded or
will exceed $120,000 and in which any current director,
executive officer, holder of more than 5% of our capital stock,
or any member of the immediate family of any of the foregoing,
had or will have a direct or indirect material interest, other
than in connection with compensation as described in
“Compensation Discussion and Analysis” below.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information known to us regarding
beneficial ownership of our common stock, as of the Record Date,
by each person known by us to own more than 5% of our common
stock, each director and each of our named executive officers
and by all of our directors and executive officers as a group
(seven persons). The table lists the number of shares and
percentage of shares beneficially owned based on
35,253,803 shares of common stock outstanding as of the
close of business on the Record Date. In calculating the number
of shares beneficially owned by an individual or entity and the
percentage ownership of that individual or entity, shares
underlying options held by that individual or entity that are
either currently exercisable or exercisable within 60 days
following the Record Date are deemed outstanding. These shares,
however, are not deemed outstanding for the purpose of computing
the percentage ownership of any other individual or entity.
Information in the table is derived from SEC filings made by
such persons on Schedule 13G
and/or under
Section 16(a) of the Exchange Act and other information
received by the Company. Except as indicated in the footnotes to
this table, and subject to applicable community property laws,
the persons or entities named have sole voting and investment
power with respect to all shares of our common stock shown as
beneficially owned by them.
13
The following table sets forth certain information for each of
our equity compensation plans.
Section 16(a) of the Exchange Act requires that executive
officers, directors and greater than 10% owners file reports of
ownership and changes of ownership of common stock with the SEC
and the Nasdaq Global Select Market. Based on a review of the
ownership reports filed with the SEC during fiscal 2008, we
believe that all Section 16(a) filing requirements were met
during the year except that a Form 4 was filed late on
behalf of each of our non-employee directors with respect to the
May 2008 grant of 14,365 RSUs to each such director and a
Form 4 was filed late on behalf of each of our named
executive officers with respect to the April 2008 grant of
time-vesting RSUs to each such officer.
COMPENSATION
DISCUSSION AND ANALYSIS
The compensation committee of our Board (the
“Committee”) is responsible for directing our
executive compensation philosophy, policies, plans and programs
and for determining the compensation elements and amounts paid
to our named executive officers. The Committee reviews
compensation elements and amounts for our named executive
officers on an annual basis, at the time of a promotion or other
change in level of responsibilities, as well as when competitive
circumstances may require. Our current executive officers,
Messrs. Hensler, Scherich and Alavi, are responsible for
matters of company policy and are our “named executive
officers.” Many of the elements of compensation are set
forth in the employment agreements we entered into with each of
our named executive officers in connection with the completion
of the private placement of approximately 16.0 million
shares of our common stock in November 2006 (the “2006
Private Placement”), which agreements were negotiated by
affiliates of Sun Capital Partners, Inc. (together with its
affiliates, “Sun Capital”), who then held a majority
of our capital stock and controlled our Board. Each employment
agreement has a term of five years, unless terminated earlier by
the employee or by us, and is discussed throughout this
Compensation Discussion and Analysis.
Since 2007, the Committee has worked with Buck Consultants to
review and implement compensation policies for our named
executive officers that encourage our named executive officers
to operate the business in a manner that enhances stockholder
value. To that end, in 2007, Buck Consultants and the Committee
created a peer group of companies to help benchmark compensation
practices for our top management. Buck Consultants began with
metal and materials companies having market capitalization of
less than $3.0 billion and from that group identified
companies that are similar in focus and operations to us. The
companies selected were: Amcol International Corporation, Brush
Engineered Materials, Carpenter Technology Corporation, Century
Aluminum Company, Gibraltar Industries Inc., Haynes
International Inc., Metal Management, Inc., Minerals
Technologies, Olympic Steel, OM Group, Quanex Group, RTI
International Metals, Schnitzer Steel Industries, Stillwater
Mining Company and Universal Stainless & Alloy
Products. As part of its responsibilities, the Committee
continues to review the peer group to determine if any companies
should be added or removed.
Using this peer group, along with proprietary surveys of total
compensation practices, Buck Consultants conducted an assessment
of total direct compensation practices for executives in
companies that are similar in size and operations to us. Buck
Consultants identified our existing pay position relative to the
25th percentile, median, and 75th percentile of the
peer group and the more broadly surveyed executive compensation
marketplace. Buck Consultants used the additional surveys in
order to minimize the effect of any anomalies that might arise
from relying solely on the peer group and to limit any gaps in
the peer group data. The surveys were not as company-specific as
the peer group and generally included industrial surveys of
companies similar in size (e.g., revenue) to us. The
Committee expects to have this or similar information compiled
annually and will consider the recommendations of Buck
Consultants (or other compensation consultants engaged by the
Company) with respect to the establishment of compensation
package parameters, such as base salary targets and
performance-based compensation, as needed and appropriate. Due
to the upheaval in the markets and the economy in general, which
has exacerbated the relative differences between members of the
peer group and our company, the Committee currently expects to
rely more on published compensation data, focused on companies
with revenue of $250 million to $500 million, in
evaluating compensation for our named executive officers in 2009.
In April 2008, following the assessments described above and
several meetings with management, the Board and the Committee,
Buck Consultants presented recommendations to the Board and the
Committee with respect to compensation of our named executive
officers for the year 2008 and thereafter. The plan provided by
Buck Consultants was designed to support the overall
compensation philosophy of the Committee and, in particular, to
further improve retention and recruitment of talented
executives, provide a clear focus on the creation of stockholder
value and promote successful implementation of our strategic
plans. In adopting the recommendations of Buck Consultants, the
Committee determined also that management should be compensated
in part for performance against measures that are not
necessarily dependent on the market price of zinc, which
management cannot influence or control.
The Committee considers the information described above and
determines base salary and other compensation package
parameters, such as annual incentive and long-term incentive
opportunities, for the chief executive officer, subject to final
approval by our Board. The chief executive officer makes
compensation recommendations to the Committee for each of the
other named executive officers based on:
The Committee discusses these recommendations with the chief
executive officer and makes final recommendations to the Board,
which the Board considers and, if appropriate, approves.
The primary objectives of our executive compensation program are
to:
The foremost objective of our compensation program is to align
the interests of our executive officers with our
stockholders’ short- and long-term interests. To that end,
a substantial portion of our executive officers’ total
compensation is tied to the achievement of performance measures
important to our business and to the price of our stock. We
believe this focuses the efforts of our executive officers on
managing the aspects of our business that are key to our success
and aligns the interests of our executive officers more broadly
with those of our stockholders.
Our executive compensation consists of the following components:
In April 2008, the Committee and the Board revised the manner in
which our compensation for our named executive officers is
provided. Working with Buck Consultants, the Committee
determined that our total executive compensation package should
be structured to place our named executive officers between the
50th and 75th percentiles of the peer group, depending
on good to excellent performance. The guaranteed portion of the
executive compensation package (i.e., base salary) is
targeted at the 25th percentile of the peer group, which we
believe is competitive within our peer group as our Company has
tended to rank lower in terms of size compared to the companies
for which Buck Consultants provided data. The remaining portion
of the executive compensation
package is contingent (e.g., annual cash bonus incentives
and long-term incentive awards) and allows our named executive
officers to significantly increase their overall compensation
relative to the peer group for achievement of superior results
and sustained success in achieving strategic goals. As described
below, we changed the equity component of our executive
officers’ compensation from annual grants of stock options
to annual grants of restricted stock units (“RSUs”)
that vest based upon a mix of time-based vesting and
performance-based vesting.
Under our revised compensation program, performance-vesting RSUs
may be issued each year that are tied to clearly defined
performance objectives over three-year performance periods, thus
recognizing the importance of long-term performance and
attempting to reduce the impact of cyclical business conditions
and changes in the market price of zinc. By starting new
three-year measurement periods for performance awards each year,
the Committee will be able to adapt performance measures that
are appropriate for then current market and industry conditions
and also adjust the mix of performance measures based on
previous years’ experience. In addition, by providing
time-vesting awards that vest over a five-year period, the
Committee can provide incentives to our named executive officers
to set long-term value-creating goals and to continue to work to
achieve those goals. Because much of the compensation package is
contingent on performance and largely structured as equity
awards and because we believe achievement of the performance
objectives will enhance stockholder value, we feel that our
compensation philosophy properly aligns management’s
incentives with the interests of our stockholders.
Elements
of Compensation
Our base salary structure and practice of periodic salary
reviews are designed to reward individual achievement and
performance and our overall performance. Base salary is
established based on the experience, skills, knowledge and
responsibilities required of the executive officers in their
roles. When establishing the 2008 base salaries of the executive
officers, the Committee considered a number of factors,
including the years of service of the individual, the
individual’s duties and responsibilities, the ability to
replace the individual, market data on similar positions with
competitive companies, the desired range of our overall
compensation for our various management team members and our
desired balance of cash and long-term incentive compensation. We
seek to maintain base salaries that, particularly when combined
with our other elements of compensation, are competitive with
the marketplace and that allow us to attract and retain
executive talent.
Salaries for executive officers are reviewed by the Committee
and the Board on an annual basis, at the time of a promotion or
other change in level of responsibilities, as well as when
competitive circumstances may require. Increases in salary are
based on factors such as the individual’s level of
responsibility and performance, our company’s performance
and expected performance and the levels of compensation provided
by metals companies similar to us in size and operation,
including the benchmark companies identified above in
“— Overview.”
Based on this review, in 2008 we increased the base salaries of
our executive officers as set forth below in the Executive
Compensation Tables.
The objective of the annual cash bonus awards is to reward
executive officers for achieving individual and company level
performance goals. These awards are determined initially as a
percentage of each executive officer’s base salary for the
fiscal year and are based primarily on the achievement of
financial targets such as budgeted levels of net income
and/or cash
flow. The Committee may consider other operational targets, such
as safety and production and shipping performance, as well as
the impact of changes in the market price of zinc. Each annual
cash bonus is generally paid in a single installment in the
first quarter following the completion of a given fiscal year
once the annual audit report is issued or, if earlier, following
the Board’s determination that the earnings targets for the
fiscal year have been met.
For 2008, the Committee developed an annual cash bonus incentive
plan for our named executive officers (the “MIP”).
Under the MIP, each named executive officer was provided an
overall target amount for his annual cash bonus (the
“Overall Target Bonus”), which was established as a
percentage of his base salary: 80% in Mr. Hensler’s
case, or $384,000; 50% in Mr. Scherich’s case, or
$131,250; and 30% in Mr. Alavi’s case, or $48,000.
Under the
MIP, for each named executive officer, 80% of the annual cash
bonus amount depended on our net income for the year, excluding
amounts recorded as expenses in connection with the MIP. The
remaining 20% of the annual cash bonus amount for each executive
depended on the achievement of operational performance measures
identified by our Board for each executive.
For Messrs. Hensler and Alavi, the operational performance
measures were based on:
For Messrs. Hensler and Alavi, the measures were weighted
equally as 25% of the individual portion of the annual cash
bonus amount, or 5% of the overall bonus amount.
For Mr. Scherich, the operational performance measures were
based on:
The net income measure and the operational performance measures
were judged by our Board against Threshold, Target and
Distinguished levels. If the results with respect to a given
measure failed to meet the Threshold level, then nothing was to
be paid to the respective named executive officer with respect
to the portion of the Overall Target Bonus allocated to that
measure. If the Threshold level for a given measure was met,
then an amount equal to 50% of the portion of the Overall Target
Bonus allocated to that measure was to be paid. If the Target
level for a given measure was met, then 100% of the portion of
the Overall Target Bonus allocated to that measure was to be
paid, and if the Distinguished level for a given measure was
met, then 200% of the portion of the Overall Target Bonus
allocated to that measure was to be paid. If performance for a
given measure fell between two levels, the portion of the bonus
allocated to that measure was to be pro rated accordingly.
The Distinguished, Target and Threshold levels for the net
income performance measure depended on the average London Metals
Exchange (“LME”) price for zinc in 2008. For higher
LME zinc prices, the Committee established higher Distinguished,
Target and Threshold net income levels, and for lower LME zinc
price, the net income levels were lower under the MIP. Because
the average LME price of zinc for 2008 was $0.85 per pound, for
2008 under the MIP, the Threshold level for the net income
performance measure was $30.8 million, the Target level was
$38.5 million and the Distinguished level was
$48.1 million. In 2008, we reported net income, excluding
expenses with respect to the MIP, of $39.5 million, which
was between the Target and Distinguished levels for the net
income measure. In addition, we achieved between the Target and
Distinguished levels with respect to Mr. Hensler’s and
Mr. Alavi’s frequency of OSHA reportable events
measure, and we achieved between the Target and Distinguished
levels with respect to Mr. Scherich’s days payable
outstanding measure. As a result, the Board awarded
Mr. Hensler an annual cash bonus of $363,321,
Mr. Scherich an annual cash bonus of $127,860 and
Mr. Alavi an annual cash bonus of $45,415 under the MIP.
As noted above, in 2008 we changed our historic practice of
granting long-term incentive awards in the form of stock options
and instead began granting these awards in the form of RSUs.
This change was implemented in connection with the review of our
compensation practices by Buck Consultants and was designed to
better align the
interests of our executive officers with our stockholders’
long-term interests by providing them with equity-based awards
that vest over a period of time, upon achievement of certain
operational performance measures
and/or upon
the occurrence of certain events, as well as to reward executive
officers for performance. We believe this arrangement benefits
our equityholders by providing adequate incentives to retain our
executive officers and to focus their efforts on the operational
goals key to our success and by aligning their broader interests
with our equityholders by having the ultimate value of this
compensation dependent upon the value of our stock. In
determining the number of RSUs to be granted to an executive, we
take into account the individual’s position, scope of
responsibility, ability to affect profits and stockholder value,
the individual’s historic and recent performance and the
value of stock options and RSUs in relation to other elements of
the individual executive’s total compensation.
For 2008, the Committee determined that 50% of the RSUs granted
to our executive officers would be time-vesting and 50% of the
RSUs would be performance vesting. The time-vesting RSUs vest
ratably on the third, fourth and fifth anniversary of the date
of grant. The performance-vesting RSUs vest over a three-year
period based on the achievement of specified performance goals.
The Board granted 31,250, 12,500 and 6,250 time-vesting RSUs to
Messrs. Hensler, Scherich and Alavi, respectively, and the
same respective number of performance-vesting RSUs to each
executive officer. Within each grant of performance-vesting
RSUs, one third of the RSUs are allocated to each of the
following three measures.
The Committee and the Board selected a three-year performance
period for the performance-vesting RSUs because it is consistent
with our strategic planning cycle. The Committee and Board
selected the three criteria above due primarily to their
flexibility, the degree to which they broadly cover the goals of
our strategic plans and the ability to compare them against our
strategic plans and budgets. The Committee and Board selected
these measures for the first cycle of the long-term incentive
awards also because they represent clearly defined operational
strategic goals that embrace critical challenges facing the
company.
Following December 31, 2010, the Committee will assess the
Company’s performance against each of the measures above
based on three levels: Threshold, Target and Distinguished. If
the Company’s performance with respect to any of the three
measures fails to reach the Threshold level, none of the
performance-vesting RSUs allocated to that measure will vest.
Upon satisfaction of the Threshold level with respect to any
performance measure, 25% of the performance-vesting RSUs
allocated to that measure will vest. If the Company achieves the
Target level with respect to any performance measure, 100% of
the performance-vesting RSUs allocated to that measure will
vest. If the Company achieves the Distinguished level with
respect to any performance measure, 200% of the
performance-vesting RSUs allocated to that measure will vest.
The three performance levels that were set for the
performance-vesting RSUs were based on the Board’s
estimations and goals with respect to our growth and improvement
through 2010. At the time that the performance-vesting RSUs were
granted, the Committee and the Board viewed the Threshold level
of each performance measure as a reasonably attainable floor,
below which no RSUs should vest. The Target level for each
performance measure was viewed by the Committee and the Board as
representing challenging but not unattainable expectations for
the growth and improvement of our company, and the Distinguished
level was viewed by the Committee and the Board as representing
significant achievement in excess of likely expectations but not
impossible. Due in large part to the nature of the economy in
general, attainment of each of the levels is now substantially
less likely, and we did not record a compensation expense in
2008 with respect to the performance-vesting RSUs. Due to the
significant uncertainty in current economic conditions and the
resulting difficulty in projecting our future operating
performance, the Committee does not currently expect to grant
any performance-vesting RSUs to our named executive officers in
2009.
In the past, we have granted one-time bonuses to reward our
management for completing specific transactions, such as the
2006 Private Placement, and to give them incentives to achieve
specific goals. Messrs. Hensler, Scherich and Alavi
received retention bonuses of $409,290, $102,327 and $102,327,
respectively, upon each of the first two anniversaries of the
completion of the 2006 Private Placement: in November 2007 and
November 2008. We entered into the retention bonus arrangements
because we wanted to provide our management with incentives to
remain with us as we transitioned from a private company to a
public company. There are no other retention bonuses remaining
to be paid in connection with the 2006 Private Placement.
One-time bonuses have not been subject to, and have not
constituted a portion of the annual bonus for purposes of, the
maximum bonus percentages set forth in our named executive
officers’ employment agreements.
We provide post-termination benefits to our named executive
officers in the form of severance payments, a 401(k) plan and
change of control arrangements. We provide severance benefits to
our executive officers to afford them financial protection in
the event of certain terminations of their employment and also
to secure their cooperation following such a separation. We
offer our executive officers participation in our 401(k) plan
because we feel it is an important retirement benefit to offer
to all of our 401(k) plan participants. The stock option grant
agreements we entered into in connection with the January 2007
grants to our executive officers and the RSU award agreements we
entered into in connection with the April 2008 grants of
time-vesting RSUs to our executive officers provide for
accelerated vesting upon certain change of control events to
reward them in the event we are able to sell our company to a
buyer acceptable to management and the Board and to retain our
executive officers during the process of negotiating and
consummating such a transaction. The RSU award agreements we
entered into in connection with the April 2008 grants of
performance-vesting RSUs to our executive officers permit the
Committee to pro-rate each level of the performance measures
described above and to determine the Company’s performance
with respect to such pro-rated measures for the purposes of
potentially vesting performance-vesting RSUs in connection with
a change of control that occurs after on or after the first
anniversary of the grant date.
For the stock options, the accelerated vesting depends on cash
being the primary consideration received in a change of control
transaction because at the time of granting these options Sun
Capital was still our largest stockholder, was represented on
our Board and wanted to reward management for transactions that
provided liquidity for its investment in us. For the
time-vesting RSUs, the accelerated vesting depends on the
executive remaining employed by us for six months following the
change of control event, or being terminated other than for
death, disability or cause because the Committee wanted to
provide an incentive for the executive officer to remain with
the Company through the change of control process and subsequent
transition, whether such transition took up to six months or was
determined to be shorter by us or an acquirer. The details of
these post-termination benefits are described below.
Severance Payments The employment agreements
of Messrs. Hensler, Scherich and Alavi provide that if the
executive’s employment is terminated by use without cause,
or in the case of Mr. Hensler he resigns for good reason,
the executive is entitled to continue to receive his base salary
for a severance period following termination. The severance
periods for Messrs. Hensler, Scherich and Alavi are two
years, eighteen months and six months, respectively. Each
employment agreement provides that the executive will receive
severance payments through the severance period as long as
certain conditions are met, including that the executive sign a
general release of Horsehead from any claims and that the
executive has not breached any of the terms or provisions of the
non-competition and non-solicitation provisions of his
employment agreement. The non-competition period set forth in
the employment agreements are through the later of the end of
any severance period and twelve months following termination of
employment. The non-solicitation period in the employment
agreements is 24 months.
The employment agreements define “cause” as:
(i) a breach of the employee’s obligations under the
agreement; (ii) any felony or crime involving moral
turpitude by the employee which our Board determines would have
an adverse effect on (a) our reputation or relationships
with suppliers, customers, employees or others, (b) the
employee’s ability to effectively perform his duties or
(c) our business, operations or financial condition;
(iii) fraud or embezzlement; (iv) failure to comply
with the directives and policies of our Board; (v) gross
negligence or recklessness by the employee in the conduct of our
business; (vi) material abandonment of duties or
(vii) willful action to harm us. Mr. Hensler’s
employment agreement defines “good reason” as a
substantial diminution in Mr. Hensler’s
responsibilities to us.
Retirement Benefits. We sponsor a
tax-qualified employee savings and retirement plan, or 401(k)
plan, that covers most employees who satisfy certain eligibility
requirements relating to minimum age and length of service.
Under the 401(k) plan, eligible employees may elect to
contribute, with no minimum, up to the maximum allowed by the
Internal Revenue Code. In 2007, we made a matching contribution
to the executives’ 401(k) plan with an annual limit equal
to the lesser of 3% of the participant’s annual salary and
$3,000. In 2008, we began providing to each salaried employee
(401(k) terms for hourly employees are governed under collective
bargaining agreements) a non-elective contribution equal to 3%
of the employee’s eligible compensation and offering a
matching contribution equal to 50% of the portion of the
employee’s elective contribution that is equal to 4% of his
or her eligible compensation, in each case subject to limits
under applicable tax laws.
Change of Control Arrangements. The option
grant agreements we entered into with Messrs. Hensler,
Scherich and Alavi in January 2007 in connection with their
option grants under our 2006 Long-Term Equity Incentive Plan
included provisions pursuant to which the options would become
fully vested upon the consummation of certain change of control
events. In connection with a change of control where the
consideration paid to us or our stockholders consists primarily
of cash (as determined by the Committee or the Board), all of
the options granted to our named executive officers in January
2007 will be come fully vested and exercisable.
The RSU award agreements we entered into with
Messrs. Hensler, Scherich and Alavi in April 2008 in
connection with their time-vesting RSU grants under our 2006
Long-Term Equity Incentive Plan included provisions pursuant to
which the time-vesting RSUs would become fully vested upon the
date that is six months after the consummation of certain change
of control events, provided that the executive was still
employed by us at such time, or, if earlier, the date of such
executive’s termination (if not for death, disability or
cause) following consummation of the applicable change of
control event.
The RSU award agreements we entered into with
Messrs. Hensler, Scherich and Alavi in April 2008 in
connection with their performance-vesting RSU grants under our
2006 Long-Term Equity Incentive Plan included provisions
pursuant to which the Committee may pro-rate each of the
Threshold, Target and Distinguished levels with respect to each
of the three performance measures for the period ending
immediately prior to the consummation of a change of control
event that occurs on or after the first anniversary of the grant
date. The Committee may then assess the Company’s
performance against such pro-rated levels, and any
performance-vesting RSUs that would have vested in accordance
with such levels will vest immediately prior to the consummation
of the applicable change of control event.
We do not provide material perquisites that are not, in the
Committee’s view, directly related to the executive’s
duties. The only material perquisite that we provide to any of
our named executive officers is payment of the initiation fee
and annual dues for Mr. Hensler at one private social club,
based on the belief that the use of such facilities in the
course of his employment is in our interest and will further our
business purposes. Nor do we otherwise maintain retirement,
pension or deferred compensation programs for executives other
than participation in our 401(k) plan as described above. Our
executive officers are entitled, pursuant to their employment
agreements, to receive employee benefits consistent with those
received by other employees of the company. Consistent with our
compensation philosophy, we intend to continue to maintain our
current benefits for our executive officers, including health,
dental, disability, paid vacation and participation in our
401(k) plan. The Board in its discretion may revise, amend or
add to the officer’s executive benefits if it deems it
advisable. We believe these benefits are generally equivalent to
benefits provided by comparable companies. We have no current
plans to change either the employment agreements (except as
required by law or as required to clarify the benefits to which
our executive officers are entitled as set forth herein) or
levels of benefits provided thereunder.
In determining which elements of compensation are to be paid,
and how they are weighted, we take into account whether a
particular form of compensation will be deductible under
Section 162(m) of the Code. Section 162(m) generally
limits the deductibility of compensation paid to our named
executive officers to $1 million during any fiscal year
unless such compensation is “performance-based” under
Section 162(m). However, under a Section 162(m)
transition rule for compensation plans of corporations which are
privately held and which become publicly held in an initial
public offering, compensation paid under a plan that existed
prior to the initial public offering will not be subject to
Section 162(m) until the earlier of (1) a material
modification of the plan; (2) the issuance of all employer
stock and other compensation that has been allocated under the
plan; or (3) the first meeting of stockholders at which
directors are to be elected that occurs after the close of the
third calendar year following the year of the initial public
offering (the “Transition Date”). After the Transition
Date, rights or awards granted under the plan, other than
options and stock appreciation rights, will not qualify as
“performance-based compensation” for purposes of
Section 162(m) unless such rights or awards are granted or
vest upon pre-established objective performance goals, the
material terms of which are disclosed to and approved by our
stockholders.
Our compensation program is intended to maximize the
deductibility of the compensation paid to our named executive
officers to the extent that we determine it is in our best
interests. Consequently, we may rely on the exemption from
Section 162(m) afforded to us by the transition rule
described above for compensation paid pursuant to our
pre-existing plans. In addition, our 2006 Equity Incentive Plan
has been designed to permit our compensation committee to grant
stock options and other awards which will qualify as
“qualified performance-based compensation” under
Section 162(m).
Many other Code provisions, SEC regulations and accounting rules
affect the delivery of executive compensation and are generally
taken into consideration as programs are developed. Our goal is
to create and maintain plans that are efficient, effective and
in full compliance with these requirements.
The Committee will continue to review applicable accounting and
tax considerations to determine their impact on our Company and
the named executive officers with respect to compensation and
achieving the goals and objectives of our executive compensation
program.
The Committee has reviewed and discussed the Compensation
Discussion and Analysis required by Item 402(b) of
Regulation S-K
with management and, based on such review and discussions, the
Committee has recommended to the Board of directors that the
Compensation Discussion and Analysis be included in this Proxy
Statement.
The Compensation Committee:
T. Grant John
Bryan D. Rosenberger John van Roden Jack Shilling
EXECUTIVE
COMPENSATION TABLES
Summary
Compensation Table
The following table summarizes the total compensation earned in
2008, 2007 and 2006 by our named executive officers.
In addition, in connection with the 2006 Private Placement, we
made an arrangement with our option holders, including our named
executive officers, to cancel 20% of their fully vested and
exercisable options and pay an amount equal to the net purchase
price of our shares of common stock in the 2006 Private
Placement minus the exercise price of their options.
Mr. Hensler received $1,066,804, Mr. Scherich received
$266,712 and Mr. Alavi received $234,215 in respect of this
option cancellation.
During 2008, we granted RSUs to our named executive officers
under our 2006 Equity Incentive Plan, as set forth in the table
below. In the following table, one estimated possible payout is
indicated for the time-vesting RSUs, the Target amount, and
three estimated possible payouts are indicated for the
performance-vesting RSUs, depending on the Company’s
achievement against the performance measures established for the
performance-vesting RSUs. In the case of the time-vesting and
performance-vesting RSUs, no payout would occur with respect to
RSUs that do not vest.
24
Outstanding
Equity Awards at Fiscal Year-End
The following table summarizes the outstanding equity awards as
of December 31, 2008 held by our named executive officers.
The market value of RSUs that have not vested is based on the
closing price of our common stock on the Nasdaq Global Select
Market on December 31, 2008.
The following table summarizes the options exercised by our
named executive officers during 2008. The exercise price for
such options was $1.01 per share, in the case of
Messrs. Hensler and Scherich, and $2.36 per share, in the
case of Mr. Alavi. The value realized upon exercise is
based on the average per share price for which the individual
sold the shares of stock acquired on exercise, which shares were
sold in each case on the date of such exercise. None of the RSUs
granted to our named executive officers have vested.
We do not maintain pension plans. Our Board may in the future
elect to provide officers and other employees with pension
benefits if the Board determined that doing so is in our best
interests.
Non-Qualified
Deferred Compensation
We do not maintain defined contribution plans or other deferred
compensation plans. The Committee may in the future elect to
provide officers and other employees with defined contribution
or deferred compensation benefits if the Board determines that
doing so is in our best interests.
Assuming each named executive officer’s employment was
terminated under each of the circumstances set forth below, or a
change in control occurred, on December 31, 2008, the
estimated values of payments and benefits to each named
executive officer are set forth in the following table.
Options granted to Messrs. Hensler, Scherich and Alavi
under our 2004 Stock Option Plan became fully vested upon the
closing of the 2006 Private Placement. If the employment of any
executive officer is terminated by us other than for cause, his
vested options may be exercised after the date of termination
but on or before the 15th day of the third calendar month
following the date of termination. If the employment of any
executive officer terminates due to death or disability, his
vested options may be exercised after the date of termination
but on or before the later of (a) December 31 of that year
or (B) the 15th day of the third calendar month after
the date of termination.
The grant agreements governing the options granted to
Messrs. Hensler, Scherich and Alavi in January 2007 provide
that all such options will vest and become exercisable in
connection with a change of control for which the consideration
received by the Company or the stockholders is primarily cash,
as determined by our Board or the Committee. As of
December 31, 2008, one fifth of the options have vested and
are exercisable. Had such a change of control occurred on
December 31, 2008, all of the options would have vested,
and the value of such vested options is shown in the table above
and is based upon the closing price of our common stock on the
Nasdaq Global Select Market on December 31, 2008, which was
less than the exercise price for such options.
The RSU award agreements governing the time-vesting RSUs granted
to Messrs. Hensler, Scherich and Alavi in April 2008
provide that all such time-vesting RSUs will vest on the date
that is six months after the consummation of a change of control
provide that the individual remains employed by the Company
through such date, provided that in the event the
individual’s employment is terminated prior to such date,
other than for death, disability or cause, such vesting will
occur on the date of such termination. The value of such vested
time-vesting RSUs is shown in the table above and based upon the
closing price of our common stock on the Nasdaq Global Select
Market on December 31, 2008.
The RSU award agreements governing the performance-vesting RSUs
granted to Messrs. Hensler, Scherich and Alavi in April
2008 provide for pro-ration and potential accelerated vesting.
See “Elements of Compensation-Post-Termination
Benefits-Severance Payments — Change of Control
Payments.” The assumed date of December 31, 2008 would
occur prior to the first anniversary of the grant date, and as
such, no pro-ration would occur under the terms of the award
agreements.
In 2008, each of our non-employee directors received a fee at a
rate of $40,000 per year for service as a director, our audit
committee chairman received an additional fee at a rate of
$20,000 per year and beginning in August 2008, the chairs of
each of our compensation committee and nominating and corporate
governance committee began
receiving an additional fee at a rate of $10,000 per year. In
May 2008, we issued to each of Messrs. John, van Roden,
Shilling and Rosenberger 14,365 RSUs, vesting one third each
anniversary of May 14, 2008. All of our directors are
reimbursed for out-of-pocket expenses incurred in connection
with attending all Board and committee meetings. The following
table summarizes the compensation of our directors in 2008.
The following table presents fees for professional services
rendered by Grant Thornton LLP for fiscal 2007 and fiscal 2008.
Audit Fees: Consists of fees billed for
professional services rendered in connection with the audit of
the consolidated financial statements of Horsehead Holding Corp.
for fiscal 2007 and 2008, our April 2007 private placement of
common stock and our August 2007 initial public offering.
Audit-Related Fees: Consists of fees billed
for assurance and related services that are not reported under
“Audit Fees.” These services include audits of
employee benefit plans.
Tax Fees: Consists principally of fees for
services provided in connection with tax planning, advice,
diligence and compliance services.
All Other Fees: Consists of fees for services
other than those reported above.
All audit, audit-related and tax services performed by Grant
Thornton LLP in fiscal 2008 were pre-approved by the audit
committee of our board of directors, which concluded that the
provision of such services by Grant Thornton LLP was compatible
with the maintenance of that firm’s independence in the
conduct of its auditing functions.
Pursuant to the audit committee charter, the audit committee
must approve all audit engagement fees and other significant
compensation to be paid to the independent auditor and the terms
of such engagement. The audit committee’s charter provides
also that individual engagements must be separately approved.
Additionally, the audit committee is required to pre-approve any
non-audit services to be provided to the Company by the
independent auditor. The policy requires also specific approval
by the audit committee if total fees for audit-related and tax
services would exceed total fees for audit services in any
fiscal year. The policy authorizes the audit committee to
delegate to one or more of its members pre-approval authority
with respect to permitted services.
We expect representatives of Grant Thornton LLP to be present at
the 2009 annual meeting.
The audit committee of our board of directors has reviewed and
discussed the audited financial statements with management,
which has represented that the financial statements were
prepared in accordance with accounting principles generally
accepted in the United States. The audit committee discussed
with management the quality and acceptability of the accounting
principles employed including all critical accounting policies
used in the preparation of the financial statements and related
notes, the reasonableness of judgments made, and the clarity of
the disclosures included in the statements.
The audit committee also reviewed our consolidated financial
statements for fiscal 2008 with Grant Thornton LLP, our
independent auditors for fiscal 2008, who are responsible for
expressing an opinion on the conformity of those audited
financial statements with accounting principles generally
accepted in the United States. The audit committee has discussed
with Grant Thornton LLP, the matters required to be discussed by
Statement on Auditing Standards No. 61, Communication with
Audit Committees.
The audit committee has received the written disclosures and the
letter from Grant Thornton LLP required by Independence
Standards Board Standard No. 1 (Independence Discussion
with Audit Committees) and has discussed with Grant Thornton LLP
its independence and has considered whether the provision of
non-audit services by Grant Thornton LLP to us is compatible
with maintaining Grant Thornton LLP’s independence.
In reliance on the reviews and discussions referred to above,
the audit committee recommended to the Board that the audited
financial statements be included in our Annual Report
Form 10-K
for the year ended December 31, 2008 for filing with the
Securities and Exchange Commission.
This report is submitted by the members of the audit committee:
John van Roden
Bryan D. Rosenberger T. Grant John Jack Shilling
Our By-laws permit stockholders to make proposals for, and to
nominate directors for election at, an annual stockholder
meeting. Stockholder proposals intended for inclusion in the
Company’s proxy statement relating to the next annual
meeting in May 2010 must be received by the Company no later
than December 3, 2009. Any such proposal must comply with
Rule 14a-8
of Regulation 14A of the proxy rules of the SEC. Under the
Company’s by-laws, proposals of stockholders not intended
for inclusion in the proxy statement, but intended to be raised
at the Company’s regularly scheduled annual meeting of
stockholders to be held in 2010, including nominations for
election as directors of persons other than nominees of the
Board of Directors, must comply with the procedures outlined in
the Company’s by-laws, which are described below, and must
be received, by the Corporate Secretary at the address noted
below, no earlier than January 14, 2010 and no later than
February 13, 2010. In the event the annual meeting for 2010
is scheduled to be held on a date more than 30 days prior
to or delayed by more than 60 days after May 15, 2010,
notice of such proposals or nominations must be so received not
later than the close of business on the 10th day following
the earlier of the day on which notice of the date of the 2010
annual meeting was mailed or public disclosure of the 2010
annual meeting was made. A copy of the Company’s by-laws
may be found on the Company’s website www.horsehed.net, and
is available upon request from the Corporate Secretary, 4955
Steubenville Pike, Suite 405, Pittsburgh, Pennsylvania
15205.
Notice of a stockholder proposal must include, as to each matter
proposed, (i) a brief description of the business desired
to be brought before the annual meeting, (ii) the name and
address, as it appears on the Company’s books, of the
stockholder proposing such business, (iii) the class and
number of shares of the Company’s capital stock which are
beneficially owned by the stockholder and (iv) any material
interest of the stockholder in such business.
A notice of a stockholder nomination for election to the Board
shall set forth (i) as to each person whom the stockholder
proposes to nominate for election as a director at such meeting
(A) the name, age, business address and residence address
of the person, (B) the principal occupation or employment
of the person, (C) the class or series and number of shares
of capital stock of the Company which are owned beneficially or
of record by the person and (D) any other information
relating to the person that would be required to be disclosed in
a proxy statement or other filings required to be made in
connection with solicitations of proxies for election of
directors pursuant to Regulation 14A under the Exchange
Act; and (ii) as to the stockholder giving the notice
(A) the name and record address of such stockholder,
(B) the class or series and number of shares of capital
stock of the Company which are owned beneficially or of record
by such stockholder, (C) a description of all arrangements
or understandings between such stockholder and each proposed
nominee and any other person or persons (including their names)
pursuant to which the nomination(s) are to be made by such
stockholder, (D) a representation that such stockholder
intends to appear in person or by proxy at the meeting to
nominate the persons named in its notice and (E) any other
information relating to such stockholder that would be required
to be disclosed in a proxy statement or other filings required
to be made in connection with solicitations of proxies for
election of directors pursuant to Regulation 14A under the
Exchange Act. Such notice must be accompanied by a written
consent of each proposed nominee to being named as a nominee and
to serve as a director if elected.
We evaluate director nominees recommended by stockholders in the
same manner in which we evaluate other director nominees. We
have established through our Corporate Governance and Nominating
Committee selection criteria that identify desirable skills and
experience for prospective Board members, including
consideration of the potential candidate’s qualification as
independent, as well as consideration of diversity, age, skills,
expertise and experience in the context of the Board and other
criteria determined by the Corporate Governance and Nominating
Committee determines from time to time.
ADDITIONAL
INFORMATION
We will bear the cost of the Annual Meeting and the cost of this
proxy solicitation, including mailing costs. In addition to
solicitation by mail, our directors, officers, and regular
employees may solicit proxies by telephone or otherwise, with no
specific additional compensation to be paid for such services.
The Board knows of no matter to be brought before the Annual
Meeting other than the matters identified in this proxy
statement. If, however, any other matter properly comes before
the Annual Meeting, the individuals named in the proxy solicited
by the Board intend to vote on it on behalf of the stockholders
they represent in accordance with their best judgment.
By order of the Board of Directors
Ali Alavi
Secretary
Dated: April 2, 2009
HORSEHEAD HOLDING CORP.
4955 STEUBENVILLE PIKE SUITE 405 PITTSBURGH, PA 15205 VOTE
BY INTERNET - www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE SHAREHOLDER COMMUNICATIONS
If you would like to reduce the costs incurred by Horsehead Holding Corp. in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access shareholder communications electronically in future years. VOTE
BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Horsehead Holding Corp., c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice and Proxy Statement and Form 10-K are available at www.proxyvote.com. M12420
HORSEHEAD HOLDING CORP.
PROXY FOR 2009 ANNUAL MEETING OF SHAREHOLDERS
May 14, 2009
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder(s) of Horsehead Holding Corp., a Delaware corporation (the “Company”),
do/does hereby appoint(s) Robert D. Scherich and Ali Alavi, and each of them, with full power to
act alone, the true and lawful attorneys-in-fact and proxies of the undersigned, with full powers
of substitution, and hereby authorize(s) them and each of them, to represent the undersigned and to
vote all shares of common stock of the Company that the undersigned is/are entitled to vote at the
2009 Annual Meeting of Shareholders of the Company to be held on May 14, 2009 at 11:00 a.m., local
time, at the InterContinental Chicago, 505 North Michigan Avenue, Chicago, Illinois 60611, and any
and all adjournments and postponements thereof, with all powers the undersigned would possess if
personally present, on the proposals listed on the reverse side, each as more fully described in
the accompanying proxy statement, and any other matters coming before said meeting.
IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED “FOR” THE ELECTION OF THE NOMINEES FOR DIRECTORS
NAMED IN PROPOSAL 1, AND IN THE DISCRETION OF THE PROXIES, ON SUCH OTHER MATTERS AS MAY PROPERLY
COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF TO THE EXTENT PERMITTED
UNDER APPLICABLE LAW.
Receipt of the Proxy Statement is hereby acknowledged.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)
(Continued and to be signed on the reverse side)
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