Richard Marabito
OLYMPIC STEELAbout Richard Marabito
Richard T. Marabito, 61, is Chief Executive Officer of Olympic Steel, Inc. (ticker: ZEUS) and has served on the Board since 2019; he became CEO in January 2019 after 18 years as CFO (2000–2018), having joined the Company in 1994 as Corporate Controller and also serving as Treasurer during 1994–2002 and 2010–2012 . Under his tenure, incentive design has emphasized EBITDA and return on net assets; shareholder support for pay practices was strong with ~99% Say‑on‑Pay approval in 2024 . Recent performance reflects metals cycle normalization: company total shareholder return (TSR) based on $100 invested moved from 75 (2020) to 191 (2024), while EBITDA moved from $18.5m (2020) to $72.3m (2024) after peaking in 2021 .
Performance snapshot
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| TSR (Value of $100 Investment) | 75 | 132 | 192 | 384 | 191 |
| EBITDA ($000s) | 18,546 | 214,632 | 153,485 | 95,856 | 72,287 |
| Net Income ($000s) | (5,595) | 121,051 | 90,931 | 44,529 | 22,980 |
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Olympic Steel | Chief Executive Officer | 2019–present | Led pivot of senior incentives to EBITDA and return-on-net-assets; oversaw acquisitions extending value-added offerings . |
| Olympic Steel | Chief Financial Officer | 2000–2018 | Managed capital allocation through cycle; long tenure aligns with balance-sheet discipline. |
| Olympic Steel | Corporate Controller; Treasurer | Controller 1994–2000; Treasurer 1994–2002, 2010–2012 | Built finance infrastructure; treasury experience supports risk management. |
| Publicly traded wholesale distributor | Corporate Controller (prior to 1994) | — | Public-company controls experience. |
| National accounting firm | Audit department (early career) | — | External audit rigor informs governance/controls. |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| CBIZ, Inc. | Director; Chair, Audit Committee | Since Aug 2021 | Public company board; financial oversight role. |
| American Iron and Steel Institute | Board Member | Current | Industry policy/advocacy exposure. |
| University of Mount Union | Board of Trustees | Current | Community/education governance. |
| Metals Service Center Institute (MSCI) | Past Chair and Director | Prior service | Industry leadership network. |
| Make‑A‑Wish (OH/KY/IN) | Past Board Member; Past regional Chair | Prior service | Nonprofit governance. |
Fixed Compensation
| Component | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 735,000 | 735,000 | 975,000 (increase effective 1/1/2024) |
| All Other Compensation ($) | 404,600 | 242,284 | 232,983 (incl. SERP $190,125; 401k/profit‑sharing $10,350; insurances; perqs) |
Notes
- 2024 base salary set via employment continuation letter effective 1/1/2024 .
- Perquisites include car and cell phone allowances and personal tax prep; no tax gross‑ups for parachute excise taxes (cutback applies) .
Performance Compensation
Annual cash incentive (Senior Manager Cash Incentive Plan)
- Design: Percentage of EBITDA (ex‑LIFO) with hurdle of EBITDA > 5% of average AR+Inventory+PP&E; capped at $3,000,000 per participant .
- CEO participation: 1.15% of EBITDA; 2024 target EBITDA $85m (vs. $65m in 2023) .
- 2024 actual: EBITDA $72.3m → CEO payout $831,296 .
| Metric | Weighting | Target | Actual | Payout |
|---|---|---|---|---|
| EBITDA (ex‑LIFO) | 100% | $85m (2024) | $72.3m (2024) | $831,296 (CEO) |
Long‑term incentives (C‑suite LTIP)
- Structure: Mix of RSUs (time‑based, 3‑year vest) and PSUs (3‑year performance period) with potential supplemental cash; PSUs metric is return on net assets (EBITDA / average AR+Inventory+PP&E) with threshold >5% and max at >10% (150% payout cap); RSUs convert to shares at vest .
- 2024 CEO grant: 8,246 RSUs + 8,246 PSUs; target grant value $1,100,000 .
| Award | Grant Date | Target Shares/Units | Metric | Vesting | Max Payout |
|---|---|---|---|---|---|
| RSU | 1/1/2024 | 8,246 | Service | 3 years (12/31/2026) | n/a |
| PSU | 1/1/2024 | 8,246 | Return on net assets | 2024–2026; >5% to vest | 150% if >10% |
2024 vesting/delivery (supply considerations)
- Shares acquired on vesting in 2024: 80,322; value realized $4,392,287; includes 11,000 RSUs and 16,500 PSUs (from earlier grants) that vested 12/31/2024 and converted to shares in 2025; also includes 51,506 RSUs that vested 1/1/2024 but will be delivered at retirement .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 58,690 shares (incl. 2,505 in IRA) as of 3/10/2025; “<1%” of outstanding . |
| Additional vested RSUs (not yet delivered) | 144,668 shares (excluded from ownership % calc) . |
| Unvested RSUs (12/31/2024) | 19,246 units; scheduled vest: 11,000 on 12/31/2025; 8,246 on 12/31/2026; market value $631,461 at $32.81 . |
| Unvested PSUs (12/31/2024) | 24,746 units (16,500 for 2023–2025 modeled at 150%; 8,246 for 2024–2026 at 100%); market value $811,916 at $32.81 . |
| Deferred/retirement‑settled RSUs | 52,822 RSUs carried in nonqualified deferral (convert at retirement) ; plus separate lot of 51,506 RSUs that vested 1/1/2024 and will convert at retirement . |
| Ownership guidelines | CEO required to hold 5× base salary; as of 12/31/2024, all C‑suite executives met requirements . |
| Hedging/pledging | Prohibited for directors and executive officers (explicit anti‑hedging and anti‑pledging policy) . |
Shares outstanding context: 11,162,704 shares as of 3/10/2025 .
Employment Terms
| Topic | Key terms |
|---|---|
| Current role/letter | Employment continuation letter effective 1/1/2024; CEO; base salary $975,000; eligible for annual bonus and LTI; standard benefits . |
| Severance (no CIC) | If terminated without cause: continuation of base salary, bonus, benefits and perqs for up to 24 months; 2‑year non‑compete and non‑solicit . |
| Estimated no‑cause payout (12/31/2024) | $7,860,070 total (salary $1,950,000; bonus $1,662,592; retirement contributions $400,950; insurance $47,769; LTI equity $2,200,032; LTI cash $1,457,500; perqs $141,227) . |
| Change‑in‑control (CIC) | C‑suite LTIP awards vest on double‑trigger (no replacement award or qualifying termination); some pre‑2022 RSUs accelerate on CIC . |
| Estimated CIC payout (12/31/2024) | $10,331,656 total (salary $2,436,850; cash incentive $3,524,089; retirement $750,565; perqs $185,245; insurance $47,769; LTI equity $2,660,817; LTI cash $726,321) . |
| 280G tax treatment | Parachute payments reduced to avoid excise tax (no gross‑up) . |
| Clawback | Dodd‑Frank compliant clawback adopted 11/2/2023; applies to excess incentive‑based comp after restatements; fault not required . |
Board Governance
| Attribute | Detail |
|---|---|
| Board service | Director since 2019; CEO since January 2019 . |
| Independence | Management director (not independent); Board identifies six independent directors and one independent nominee; CEO not listed among independents . |
| Committees | Audit & Compliance; Compensation; Nominating & Governance committees comprised solely of independent directors; CEO not listed as member . |
| Attendance | “Each of our Directors attended all of the regularly scheduled meetings” in 2024 . |
| Leadership structure | Executive Chairman (Michael D. Siegal) and separate CEO (Marabito); Lead Independent Director (Arthur F. Anton) with defined authorities; executive sessions of non‑management at each regular meeting . |
Board service history, committee roles, and dual‑role implications
- Dual role: CEO and director (not Chair); mitigated by separate Executive Chair and an empowered Lead Independent Director; all key committees are independent .
- Independence: As CEO, not independent; independent oversight via committee structure and executive sessions .
- Attendance: Full attendance supports engagement .
Compensation Structure Analysis
| Area | 2024 design/observations |
|---|---|
| Cash vs equity mix | Higher cash mix than peers by design due to micro‑cap share count constraints; annual plan emphasizes EBITDA . |
| Annual metric rigor | Single metric (EBITDA ex‑LIFO) with 5% capital‑base hurdle; payout scales with EBITDA; $3m cap . |
| LTI risk profile | Shift to RSU+PSU LTIP (3‑yr) adopted in 2022; PSU tied to return on net assets with 5% threshold and 150% max at >10% . |
| Discretionary actions | 2020 one‑time modification to allow prorated incentive for H2’20 amid COVID; otherwise plan operates formulaically . |
| Consultant/peers | Pearl Meyer advises; no conflicts; peer group spans metals/industrial names; no fixed percentile targeting . |
Compensation peer group (benchmarking reference beginning 2023; also used for 2024 decisions)
- Ryerson Holding; Worthington Industries; Mueller Industries; Kaiser Aluminum; Schnitzer Steel; Allegheny Technologies; Century Aluminum; Masonite; Griffon; The Greenbrier Companies; Wabash National; The Manitowoc Company; Gibraltar Industries; Carpenter Technology; Kennametal; Quanex Building Products; Warrior Met Coal; Park‑Ohio .
Vesting Schedules and Potential Selling Pressure
| Bucket | Quantity | Timing/terms | Commentary |
|---|---|---|---|
| RSUs (time‑based) outstanding | 11,000 | Vest 12/31/2025 | Delivery at vest (C‑suite RSUs), adds supply. |
| RSUs (time‑based) outstanding | 8,246 | Vest 12/31/2026 | Delivery at vest, adds supply. |
| PSUs (performance) outstanding | 16,500 | 2023–2025 cycle; modeled at 150% | Delivery at certification; upside to 150% linked to return‑on‑net‑assets. |
| PSUs (performance) outstanding | 8,246 | 2024–2026 cycle; modeled at 100% | Dependent on achieving >5% threshold. |
| Retirement‑settled RSUs | 52,822 | Delivered upon retirement | Large deferred block; potential post‑retirement supply. |
| Vested RSUs (retirement‑settled) | 51,506 | Vested 1/1/2024; delivered at retirement | Adds to deferred overhang. |
| 2024 vest‑to‑share conversion | 27,500 | 11,000 RSUs + 16,500 PSUs vested 12/31/2024; converted to shares in 2025 | Actual float increase in 2025. |
Anti‑hedging and anti‑pledging policies reduce forced‑sale risk; stock ownership guidelines (5× salary) and compliance increase alignment .
Performance & Track Record
| Measure | 2020 | 2021 | 2022 | 2023 | 2024 | Notes |
|---|---|---|---|---|---|---|
| TSR (Value of $100) | 75 | 132 | 192 | 384 | 191 | Cyclical amplitude; 2023 peak retraced in 2024. |
| EBITDA ($000s) | 18,546 | 214,632 | 153,485 | 95,856 | 72,287 | Normalization from 2021 peak. |
| Net Income ($000s) | (5,595) | 121,051 | 90,931 | 44,529 | 22,980 | Mirrors EBITDA trend. |
Say‑on‑Pay & Shareholder Feedback
- 2024 Say‑on‑Pay approval ~99%; committee made no significant changes given high support .
Related‑Party Transactions (Marabito‑specific)
- The proxy discloses related‑party items (e.g., Executive Chairman‑affiliated lease), but none involve Mr. Marabito .
Compensation Committee and Governance Controls
- Compensation Committee composed solely of independent directors; advised by Pearl Meyer; no interlocks .
- Clawback policy (effective 11/2/2023) now in place; mandatory recovery on restatements .
- Insider trading policy and anti‑hedge/pledge restrictions apply to executives/directors .
Employment Terms (Severance and CIC Economics) — Detail
| Scenario (as of 12/31/2024) | Cash Salary | Cash Incentive | Retirement Contributions | Insurance | LTI Equity | LTI Cash | Perqs | Total |
|---|---|---|---|---|---|---|---|---|
| Termination without cause | $1,950,000 | $1,662,592 | $400,950 | $47,769 | $2,200,032 | $1,457,500 | $141,227 | $7,860,070 |
| Change in Control (double‑trigger) | $2,436,850 | $3,524,089 | $750,565 | $47,769 | $2,660,817 | $726,321 | $185,245 | $10,331,656 |
Additional CIC mechanics:
- Pre‑2022 RSUs accelerate on CIC; C‑suite LTIP (post‑2022) requires double‑trigger; indicative LTIP acceleration value for CEO: $1,443,378 (pro‑rata on death/disability/retirement at ≥62) .
Director Service and Compensation (as Director)
- As an employee‑director, Mr. Marabito does not receive separate director fees/equity (director pay table excludes NEOs) .
Investment Implications
- Alignment: High equity alignment via RSUs/PSUs, strict anti‑hedging/pledging, and 5×‑salary ownership guideline (in compliance) support long‑horizon incentives .
- Retention risk: Two‑year non‑compete/non‑solicit and sizable severance/CIC protections reduce near‑term departure risk; clawback and independent oversight mitigate moral hazard .
- Trading signals/supply:
- 2025: Conversion of 27,500 shares from 12/31/2024 vesting increased float in 2025 .
- 2025–2026: Scheduled RSU vests (11,000 in 2025; 8,246 in 2026) and PSU outcomes (16,500 for 2023–2025; 8,246 for 2024–2026) can add supply at vest; realized PSU payout sensitive to return‑on‑net‑assets .
- Post‑retirement: Large block of retirement‑settled RSUs (52,822 plus other legacy lots) represents deferred overhang that may be delivered at separation .
- Pay‑for‑performance: Annual cash plan directly tied to EBITDA (ex‑LIFO) and constrained by capital‑base hurdle; LTIP ties to asset‑turn/returns, limiting payout in downcycles—this structure aligns with cyclical risk management .
Overall: Compensation design is formulaic and capital‑return oriented with robust guardrails (clawback, anti‑hedge/pledge, double‑trigger). Watch for year‑end vesting supply and PSU performance certification as short‑term technicals while secular value creation remains tied to EBITDA/return‑on‑net‑assets execution through the metals cycle .