Sypris Solutions, Inc. Annual Report 2011

← All annual reports

FY2011 Annual Report · Sypris Solutions, Inc.

Loading PDF…

Notice of 2011 Annual Meeting
and
Proxy Statement

SYPRIS SOLUTIONS, INC.

101 Bullitt Lane, Suite 450
Louisville, Kentucky 40222

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TIME . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10:00 a.m. EDT

Tuesday, May 10, 2011

PLACE . . . . . . . . . . . . . . . . . . . . . . . . . . Lower Level Seminar Room

ITEMS OF BUSINESS . . . . . . . . . . . . . .

101 Bullitt Lane, Louisville, Kentucky 40222

(1) To elect three Class III members of the Board of Directors, whose
terms are described in the Proxy Statement.
(2) To transact such other business as may properly come before the
meeting and any postponement or adjournment thereof.

RECORD DATE . . . . . . . . . . . . . . . . . . . Holders of record of Sypris Common Stock at the close of business

on March 17, 2011 are entitled to vote at the meeting.

ANNUAL REPORT . . . . . . . . . . . . . . . . The Company’s 2010 Annual Report, which is not a part of the proxy

PROXY VOTING . . . . . . . . . . . . . . . . . .

soliciting materials, is enclosed.

that your shares be represented and voted at the

It is important
meeting. You can vote your shares in one of four ways:
(1) Visit the Web site noted on your proxy card to vote via the

Internet;

(2) Use the toll-free telephone number on your proxy card to vote by

telephone;

(3) Sign, date and return your proxy card in the enclosed envelope to

vote by mail; or

(4) Attend the meeting in person.

A Proxy Statement describing matters to be considered at the Annual
Meeting is attached to this notice.

John R. McGeeney
General Counsel and Secretary

April 1, 2011

Important Notice Regarding the Availability of Proxy Materials

The notice of annual meeting of stockholders to be held on May 10, 2011, this Proxy Statement, form of
proxy card and the Sypris Solutions 2010 Annual Report on Form 10-K are available at
www.sypris.com/proxymaterials.

TABLE OF CONTENTS

PROXY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

GOVERNANCE OF THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . .

AUDIT AND FINANCE COMMITTEE REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

PROPOSAL ONE, ELECTION OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

CLASS III DIRECTOR NOMINEES FOR TERMS EXPIRING IN 2014 . . . . . . . . . . . . . . . . . . . . . . .

CLASS I DIRECTORS WHOSE TERMS WILL EXPIRE IN 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . .

CLASS II DIRECTORS WHOSE TERMS WILL EXPIRE IN 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . .

STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE . . . . . . . . . . . . . . . . . . . . . . .

EXECUTIVE OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SUMMARY COMPENSATION TABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2010 DIRECTOR COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

AVAILABILITY OF REPORT ON FORM 10-K . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

OTHER MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SUBMISSION OF STOCKHOLDER PROPOSALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

Sypris Solutions, Inc.
101 Bullitt Lane, Suite 450
Louisville, KY 40222

PROXY STATEMENT

We are providing this Proxy Statement to you in connection with the solicitation by the Board of Directors
of Sypris Solutions, Inc. of proxies to be voted at our 2011 Annual Meeting of Stockholders and at any
postponement or adjournment thereof. In this Proxy Statement, we refer to Sypris Solutions, Inc. as “Sypris,”
“Sypris Solutions,” “we,” “our” or “the Company.”

You are cordially invited to attend the Annual Meeting on May 10, 2011, beginning at 10:00 a.m. EDT. The

Annual Meeting will be held at 101 Bullitt Lane, Lower Level Seminar Room, Louisville, Kentucky 40222.

We are first mailing this Proxy Statement on or about April 1, 2011, to holders of our Common Stock at the

close of business on March 17, 2011 which is the “Record Date” for the Annual Meeting.

Proxies and Voting Procedures

Stockholder of Record: Shares Registered in Your Name

Your vote is important. If you are a stockholder of record, you may a) vote in person at the meeting, b) vote
by proxy using the enclosed proxy card, c) vote by proxy over the telephone, or d) vote by proxy on the internet,
in each case as described below. You may still attend the meeting and vote in person even if you have already
voted by proxy. In order to vote over the Internet or via telephone, please call the number or go to the website
identified on the enclosed proxy card and follow the instructions. The Internet and telephone voting facilities will
close at 12:00 a.m. EDT on May 10, 2011.

You can revoke your proxy at any time before it is exercised by timely delivery of a properly executed,
later-dated proxy (including an Internet or telephone vote before the deadline) or by voting by ballot at the
Annual Meeting. Simply attending the annual meeting will not, by itself, revoke your proxy.

Beneficial Owner: Shares Registered in the Name of Broker or Bank

If you are a beneficial owner of shares registered in the name of your broker, bank or other nominee, you
should have received a proxy card and voting instructions with these proxy materials from that organization
rather than from us. Simply complete and mail the proxy card and voting instructions to ensure that your vote is
counted. Alternatively, you may vote by telephone or over the Internet as instructed by your broker, bank or other
nominee. To vote in person at the Annual Meeting, you must obtain a valid proxy from your broker, bank or
other nominee. Follow the instructions from your broker, bank or other nominee included with these proxy
materials, or contact your broker, bank or other nominee to request a proxy card. Otherwise, your shares may not
be voted with respect to certain proposals, including the election of directors.

Voting Procedures

All shares entitled to vote and represented by proxies received prior to the Annual Meeting, and not
revoked, will be voted at the Annual Meeting in accordance with your instructions. If you do not indicate how
your shares should be voted on a matter, the shares represented by your proxy will be voted as the Board
of Directors recommends.

If any other matters are properly presented for consideration at the Annual Meeting, including, among other
things, consideration of a motion to adjourn the meeting to another time or place in order to solicit additional
proxies in favor of the recommendations of the Board of Directors, the persons named as proxies and acting
thereunder will have discretion to vote on those matters according to their best judgment to the same extent as the

person delivering the proxy would be entitled to vote. As of the date of this Proxy Statement, we did not
anticipate that any other matters would be raised at the Annual Meeting.

Stockholders Entitled to Vote

Holders of Sypris Common Stock at the close of business on the Record Date are entitled to receive notice of
and to vote at the Annual Meeting. Each share of Common Stock is entitled to one vote on each matter properly
brought before the meeting. Stockholders do not have the right to cumulate their votes in the election of directors.

On the Record Date, March 17, 2011, there were 19,574,205 shares of Sypris Common Stock outstanding. A
list of stockholders entitled to vote at the Annual Meeting will be available at the Annual Meeting and for 10
days prior to the Annual Meeting at the Company’s offices at 101 Bullitt Lane, Suite 450, Louisville, Kentucky
40222, between 8:30 a.m. and 5:30 p.m. local time.

Quorum

The presence, in person or by proxy, of the holders of a majority of the outstanding shares entitled to vote is
necessary to constitute a quorum. Abstentions are counted as present and entitled to vote for purposes of
determining whether a quorum exists, but shares held by a broker, bank or other nominee and not voted on any
matter will not be counted for such purpose. Therefore, if you hold shares through a broker, bank or other
nominee it is important that you contact your broker with your voting instructions. If there is no quorum,
the holders of a majority of shares present at the meeting in person or represented by proxy may adjourn the
meeting to another date.

Gill Family

As of the Record Date, the Gill family beneficially owned an aggregate of 8,453,563 shares or 43.0% of the
Company’s outstanding Common Stock. For further information on ownership of Common Stock by the Gill
family, see Stock Ownership of Certain Beneficial Owners.

Multiple Stockholders Sharing the Same Address

Multiple stockholders who share a single address will receive only one Annual Report and Proxy Statement at
that address. This practice, known as “householding,” reduces printing and postage costs. However, if you wish to
receive a separate copy of the Annual Report or Proxy Statement in the future, you may contact your broker, bank or
nominee directly or contact Sypris at 101 Bullitt Lane, Suite 450, Louisville, Kentucky 40222 or at 502-329-2000. If
you own your shares through a broker, bank or other nominee, and you are receiving multiple copies of our Annual
Report and Proxy Statement, you can request householding by contacting the bank, broker or nominee.

Cost of Proxy Solicitation

Sypris will pay the cost of soliciting proxies. Sypris may reimburse brokerage firms and other persons
representing beneficial owners of shares for expenses incurred in forwarding solicitation materials to such
beneficial owners. Proxies may be solicited on behalf of the Company by directors, officers or employees of the
Company, without additional compensation, in person or by telephone, facsimile or other electronic means.

Notice Regarding Availability of Proxy Materials

In accordance with the rules of the Securities and Exchange Commission (“SEC”), we are advising our
stockholders of the availability on the Internet of our proxy materials related to the Annual Meeting described
above. These rules allow companies to provide access to proxy materials in one of two ways. Because we have
elected to utilize the “full set delivery” option, we are delivering to all stockholders paper copies of all the proxy
materials, as well as providing access to those proxy materials on a publicly accessible Web site. The notice of
annual meeting of stockholders, proxy statement, form of proxy card and annual report on Form 10-K are
available at www.sypris.com/proxymaterials.

GOVERNANCE OF THE COMPANY

Board of Directors

Our Board of Directors has adopted the Sypris Solutions, Inc. Guidelines on Corporate Governance (the
“Guidelines”). The Guidelines provide a framework for the Company’s corporate governance initiatives and
cover topics including, but not limited to, Board of Director and Committee composition and operation, director
compensation and risk management. The Nominating and Governance Committee is responsible for overseeing
and reviewing the Guidelines on an annual basis, and reporting any recommended changes to the Board of
Directors. A copy of the Guidelines is available on the Company’s website at www.sypris.com.

During 2010,

the Board of Directors held five regular meetings and one special meeting, and the
Committees held twelve meetings. All directors attended 100% of the Board meetings and meetings of
Committees of which they are members. Although the Company does not have a formal policy regarding
attendance by members of the Board of Directors at the Company’s Annual Meeting of Stockholders, more than
a majority of the directors have attended all Annual Meetings. Seven of the eight directors attended the 2010
Annual Meeting.

Independence

The Board of Directors has determined that John F. Brinkley, William G. Ferko, William L. Healey, Sidney
R. Petersen and Robert Sroka are “independent” as defined by NASDAQ’s listing standards. Each of our Audit
and Finance, Compensation, and Nominating and Governance committees is composed only of independent
directors as identified below under the heading “Committees of the Board of Directors.”

In December 2010, the independent directors selected Robert Sroka to serve a one-year term as Lead
Independent Director. Mr. Sroka, as Lead Independent Director, presides over periodic independent sessions of
the Board of Directors in which only independent directors participate. Stockholders and other parties interested
in communicating directly with the Lead Independent Director or with the independent directors as a group may
do so by writing to the Lead Independent Director, c/o Sypris Solutions, Inc., 101 Bullitt Lane, Suite 450,
Louisville, Kentucky 40222.

Communications with Stockholders

Our Board of Directors welcomes communications from our stockholders. Stockholders may send
communications to the Board of Directors, or to any director in particular, c/o Sypris Solutions, Inc., 101 Bullitt
Lane, Suite 450, Louisville, Kentucky 40222. Any stockholder correspondence addressed to the Board of
Directors, or to any director in particular, in care of the Company, is forwarded by us to the addressee.

Committees of the Board of Directors

During 2010, the Board of Directors had four ongoing Committees: the Audit and Finance Committee, the
Compensation Committee, the Nominating and Governance Committee and the Executive Committee, which
was dissolved in August of 2010.

Audit and Finance Committee

The current members of the Audit and Finance Committee are William G. Ferko (Chairman), Sidney R.
Petersen and Robert Sroka. Each member of the Audit and Finance Committee satisfies the additional
requirements of the SEC and NASDAQ for audit committee membership, including the additional independence
requirements and the financial literacy requirements. The Board of Directors has also determined that each of
Sidney R. Petersen and William G. Ferko qualify as an “audit committee financial expert” as defined by SEC
rules. During 2010, the Audit and Finance Committee met five times. The functions of the Audit and Finance

Committee are described below under the heading Audit and Finance Committee Report. The Audit and Finance
Committee operates pursuant to a formal written charter that sets out the functions that this Committee is to
perform. The Audit and Finance Committee reviews and reassesses the adequacy of the Audit and Finance
Committee Charter on an annual basis. The Audit and Finance Committee Charter is available on the Company’s
website at www.sypris.com.

Compensation Committee

The current members of the Compensation Committee are John F. Brinkley (Chairman), Robert Sroka and
William L. Healey. During 2010,
the Compensation Committee met five times. The functions of the
Compensation Committee include administering management incentive compensation plans, establishing the
compensation of executive officers and reviewing the compensation of directors. The Committee generally
approves equity awards for the Company’s other employees and non-equity compensation for the Company’s
executive officers. However, the Committee has delegated to the Company’s Chief Executive Officer the
discretion to award to non-executive employees in any one calendar year up to 100,000 stock options in the
aggregate, with a maximum individual award of 10,000. The Company’s Chief Executive Officer, with
assistance from the Director of Human Resources and their support staff, provides recommendations to the
Compensation Committee regarding compensation for those employees reporting directly to the Chief Executive
Officer. However, the Committee retains full discretion to modify any compensation recommendations by the
Chief Executive Officer or other members of management.

In 2010, the Company engaged the assistance of Pearl Meyer & Partners (“Pearl Meyer”), a compensation
consulting firm, to assist the Compensation Committee in reviewing total compensation for the Company’s
named executive officers and other key employees. Pearl Meyer provided the Compensation Committee with
relevant market data and alternatives to consider when making compensation decisions regarding the Chief
Executive Officer and the Company’s other executives. In 2010, the Compensation Committee has had direct
access to Pearl Meyer and the opportunity to review various issues relating to executive compensation in
executive session with Pearl Meyer, without management
in attendance, on an “as needed” basis. For
compensation decisions affecting 2011, the Company will continue to utilize the assistance of Pearl Meyer.

The Compensation Committee operates pursuant to a formal written charter that sets out the functions that
this Committee is to perform. The Compensation Committee reviews and reassesses the adequacy of the
Compensation Committee Charter on an annual basis. A copy of the Compensation Committee Charter is
available on the Company’s website at www.sypris.com.

Nominating and Governance Committee

The current members of the Nominating and Governance Committee are William L. Healey (Chairman),
John F. Brinkley and William G. Ferko. During 2010, the Nominating and Governance Committee met two
times. The functions of the Nominating and Governance Committee include recommending nominees to the
Board of Directors for election as directors of the Company, and evaluating the performance and effectiveness of
the Board of Directors. The Nominating and Governance Committee also makes recommendations to the Board
of Directors from time to time as to matters of corporate governance.

The Nominating and Governance Committee employs an independent director profile to assess candidates
for inclusion in the Company’s recommended slate of independent director nominees. The Nominating and
Governance Committee takes a number of attributes into account during the nomination process, including an
individual’s demonstrated leadership, maturity and public company experience. The Nominating and Governance
Committee also places a value on building a diversity of viewpoints and backgrounds on the Board, including
diversity of
races, genders, nationalities, educational backgrounds, work experiences and
extracurricular interests, which can have a positive impact on the business. A mix of talents, backgrounds,
experiences and geographic locations of the individual Board members is also important and is considered in the

religions,

evaluation of potential candidates. In addition, the Nominating and Governance Committee will consider an
individual’s integrity and commitment, as well as a candidate’s experience in our core market industries, certain
targeted knowledge areas, complex multi-industry and/or technological areas and manufacturing or service
operations.

All nominees for election at

this Annual Meeting of Stockholders are currently directors and were
previously elected by stockholders. To date, the Nominating and Governance Committee has not engaged third
parties to identify or evaluate potential director candidates. Currently, the Company’s policy is not to seek or
accept director nominations recommended by security holders (other than those directors who are also security
holders, acting in their capacity as directors), and has not received any such nominations by any non-director
security holders to date. In light of the Company’s current size, market position and historically low rates of
director turnover, the policy of the Committee has been to develop and maintain contacts with potential
candidates for future membership on the Board, primarily through the business relationships of the Company’s
current and former officers and directors.

The Nominating and Governance Committee operates pursuant to a formal written charter that sets out the
functions that this Committee is to perform. The Nominating and Governance Committee reviews and reassesses
the adequacy of the Nominating and Governance Committee Charter on an annual basis. A copy of the
Nominating and Governance Committee Charter is available on the Company’s website at www.sypris.com.

Executive Committee

The Board of Directors determined the Executive Committee was no longer necessary and approved the
dissolution of the Executive Committee in August of 2010, the members of which were Robert E. Gill
(Chairman), Jeffrey T. Gill, R. Scott Gill and Sidney R. Petersen. During 2010, the Executive Committee took no
actions at any meetings or by unanimous written consent.

Board Leadership and Risk Oversight

The Company’s Board consists of our Chairman of the Board, Robert E. Gill, our President and Chief
Executive Officer, Jeffrey T. Gill, R. Scott Gill and five independent directors. Additionally, the independent
directors annually select a Lead Independent Director. Our independent directors generally meet in executive
session, chaired by our Lead Independent Director, several weeks in advance of each regularly scheduled Board
meeting. During 2010, the Lead Independent Director presided over five such meetings. The Board has three
standing committees—Audit and Finance, Compensation, and Nominating and Governance, each of the
committees is comprised solely of independent directors.

The Board with and through its committees is actively involved in oversight of risks that could affect the
Company. While the oversight of certain risks related to compensation, financial or governance matters is
conducted primarily through designated committees of the Board, as disclosed more fully in the charters of each
of such committees, the full Board has retained responsibility for general oversight of risks. The Board satisfies
this responsibility through full reports by each committee chair regarding the committee’s considerations and
actions, as well as through regular reports directly from officers responsible for oversight of particular risks
within the Company.

The Audit and Finance Committee is generally responsible for oversight of the Company’s relationship with
its public accountants, financial reporting and internal controls, debt and credit agreements, and other financial
compliance matters. The Compensation Committee is generally responsible for oversight of the recruitment,
retention and motivation of
including
compensation, performance evaluation processes and succession planning matters for directors, officers and other
key personnel. The Nominating and Governance Committee is generally responsible for oversight of the
nominating and self-evaluative processes with respect to service on the Company’s Board of Directors, and for
oversight of other corporate governance matters.

the Company’s executive management and other employees,

Pursuant to our bylaws, our Guidelines and general practices, the Board reviews and determines the best
board leadership structure for the Company at least annually. As part of our periodic board self-evaluation
process, we evaluate our leadership structure to ensure that the Board continues to believe that it provides an
effective and efficient structure for the Company and stockholders.

We believe that our current board leadership structure is common among other public companies in the
United States, and that this leadership structure has been effective for the Company. We believe that having a
separate Chairman of the Board and Chief Executive Officer, independent chairs for each of the Audit,
Compensation, Nominating and Governance Committees and a Lead Independent Director provides a focused
leadership structure for the Company and the Board. Together with regular executive planning, analysis and
reporting, we believe that this structure provides effective oversight of the material risks and opportunities facing
the Company on an ongoing basis.

Code of Business Conduct

We have a corporate responsibility and compliance program which includes a written code of business
conduct. We require all employees, including all officers and senior level executives, to adhere to our code of
business conduct in addressing the legal and ethical issues encountered in conducting their work. The code of
business conduct requires each of our employees to avoid conflicts of interest, comply with all laws and other
legal requirements, conduct business in an honest, fair and ethical manner and otherwise act with integrity.
Employees are required to report any conduct they believe to be an actual or apparent violation of the code of
business conduct or other Company policies and procedures. The code of business conduct details the procedures
for confidential and anonymous reporting by employees and emphasizes our policy of non-retaliation. Our code
of business conduct can be found on our corporate website at www.sypris.com.

Transactions with Related Persons

The Company’s code of business conduct requires all directors, executive officers and other employees of
the Company to disclose and seek prior approval of any related person transaction. The Company’s directors,
including the Chief Executive Officer and President, must report any potential conflict of interest to the Audit
and Finance Committee, in accordance with the Guidelines and the Audit and Finance Committee Charter. The
other executive officers must report any potential conflict of interest to the Chief Executive Officer and
President. In addition, the Company requires each director and executive officer to disclose any transactions
involving related parties, or other potential conflicts of interest, in an annual written questionnaire. For 2010, no
related person transactions (as defined in Item 404(a) of Regulation S-K) were reported or otherwise discovered
by the Company.

RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS

Ernst & Young LLP has served as the Company’s independent public accountants since and including the
fiscal year ended December 31, 1989. Although the Audit and Finance Committee has not yet completed its
process for selecting the independent public accountant for the Company with respect to its 2011 financial
statements, the Audit and Finance Committee has approved the interim engagement of Ernst & Young LLP to
perform audit and audit-related services with respect to 2011. The Audit and Finance Committee’s selection
process includes consideration of the following factors: continuity of experience with the Company’s business,
internal controls and technical accounting experience; independence; history of and reputation for thoroughness,
accuracy, excellence and integrity; and reasonableness of fees. The Audit and Finance Committee has approved
the fees described below for 2010. The Audit and Finance Committee believes that the fees paid for non-audit
services are compatible with the independence of Ernst & Young LLP.

Representatives of Ernst & Young LLP will be present at the Annual Meeting. They will be given an
opportunity to make a statement, if they desire to do so, and they will be available to respond to appropriate
questions after the meeting.

Fees Billed by Ernst & Young LLP

Audit and Non-Audit Fees

The following table presents fees billed for professional audit services rendered by Ernst & Young LLP for
the audit of the Company’s annual financial statements for the years ended December 31, 2010 and 2009 and fees
billed for other services rendered by Ernst & Young LLP during those periods.

Years Ended
December 31,

2010

2009(4)

Audit Fees (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Audit-Related Fees (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax Fees (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$784,325
1,611
139,750

$ 893,904
—
258,893

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$925,686

$1,152,797

(1) Audit Fees include fees associated with the annual audit, reviews of the Company’s quarterly reports on
Form 10-Q, consultation regarding accounting and reporting matters related to the audit, review of
documents filed with the SEC and an attestation report on the Company’s internal control over financial
reporting for 2010 and 2009.

(2) Audit-Related Fees principally include technical research tools and assistance in assessing the impact of
proposed standards, rules or interpretations by the SEC, FASB, or other regulatory or standard-setting
bodies.

(3) Tax Fees consist of tax return preparation fees, tax services other than those directly related to the audit of
the income tax provision, review of state and local income tax planning opportunities, foreign tax research
and international transfer pricing analysis.

(4) Fees reported for 2009 include payments made in 2010 for fees incurred for 2009 and may not match those

fees reported in the Company’s 2010 Proxy Statement.

Policy on Audit and Finance Committee Pre-Approval of Audit and Non-Audit Services of Independent Public
Accountants

The Audit and Finance Committee’s policy is to pre-approve all audit and non-audit services provided by
the independent public accountants, either by a quorum of the Committee at any meeting or by the Committee’s
authorized delegate for approvals between meetings, all of which are reported to the Committee at its next

meeting. These services may include audit services, audit-related services, tax services and other services. With
some exceptions for certain longer-term projects, pre-approval is generally provided for up to one year, is
detailed as to the particular service or category of services and is generally subject to a specific budget. The
independent public accountants and management are required to periodically report to the full Audit and Finance
Committee regarding the extent of services provided by the independent public accountants in accordance with
this pre-approval, and the fees for the services performed to date. None of the services provided by the
independent public accountants under the categories Audit-Related and Tax described above were approved by
the Audit and Finance Committee pursuant to the waiver of pre-approval provisions set forth in Rule 2-01(c) of
Regulation S-X.

AUDIT AND FINANCE COMMITTEE REPORT

The Audit and Finance Committee met with management periodically during the year to consider the
adequacy of the Company’s internal control over financial reporting and the objectivity of its financial reporting.
The Audit and Finance Committee discussed these matters with the Company’s independent public accountants
and with appropriate Company financial personnel. The Audit and Finance Committee also discussed with the
Company’s senior management and independent public accountants and auditors the processes used to support
the certifications by the Company’s chief executive officer and chief financial officer, which are required by the
Securities and Exchange Commission and the Sarbanes-Oxley Act of 2002 for certain of the Company’s filings
with the Securities and Exchange Commission.

The Audit and Finance Committee met privately with both the independent public accountants and
Company financial personnel, each of whom has unrestricted access to the Audit and Finance Committee. The
Audit and Finance Committee appointed Ernst & Young LLP as the independent public accountants for the
Company in 2010 after reviewing the firm’s performance and independence from management, among other
factors.

Management has primary responsibility for the Company’s financial statements and the overall reporting
process, including the Company’s system of internal control over financial reporting. Ernst & Young LLP, the
Company’s independent public accountants,
is responsible for performing an independent audit of the
Company’s financial statements in accordance with generally accepted auditing standards and expressing an
opinion on the conformity of those audited financial statements in accordance with U.S. generally accepted
accounting principles. Ernst & Young LLP is also responsible for performing an audit of the Company’s internal
controls over financial reporting in accordance with the standards of the United States Public Company
Accounting Oversight Board and expressing an opinion that the Company maintained effective internal control
over financial reporting based on criteria established in Internal Control—Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission (the “COSO criteria”). The Audit and
Finance Committee is responsible for monitoring and overseeing these processes.

The Audit and Finance Committee reviewed with management and Ernst & Young LLP the Company’s
draft of Form 10-K for 2010, including the Company’s audited financial statements and met separately with both
management and Ernst & Young LLP to discuss and review those materials prior to issuance and filing with the
Securities and Exchange Commission. Management has represented, and Ernst & Young LLP has confirmed, to
the Audit and Finance Committee that the financial statements were prepared in accordance with U.S. generally
accepted accounting principles.

The Audit and Finance Committee also discussed with Ernst & Young LLP matters required to be discussed
by the Statement on Auditing Standards No. 61, as amended (AICPA, Professional Standards, Vol. 1. A U
Section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T, relating to
communications with auditors.

In addition, the Audit and Finance Committee has received from the independent public accountants the
written disclosures and the letter required by applicable requirements of the Public Company Accounting
Oversight Board regarding the independent accountant’s communications with the Audit and Finance Committee
concerning independence, has discussed with the independent public accountants their independence from the
Company and its management, and has considered whether the independent public accountants’ provision of
non-audit services to the Company is compatible with maintaining the auditor’s independence. Ernst & Young
LLP has confirmed by letter that, in its professional judgment, it is independent of the Company. The Audit and
Finance Committee is not aware of any issues which could impair the independence of Ernst & Young LLP.

The Audit and Finance Committee discussed with management and Ernst & Young LLP the quality and
adequacy of the Company’s internal control over financial reporting and the overall quality of the Company’s
financial reporting. The Audit and Finance Committee specifically addressed with management and Ernst &
Young LLP, management’s annual report regarding the effectiveness of the Company’s system of internal
controls over financial reporting, management’s ongoing responsibilities for establishing and maintaining an
adequate system, management’s evaluation of any significant deficiencies or material weaknesses in that system,
management’s process for evaluating the effectiveness of such internal control over financial reporting and the
framework that was used to evaluate the effectiveness of the system. Management has represented, and Ernst &
Young LLP has confirmed, to the Audit and Finance Committee that based on the COSO criteria, the Company
maintained, in all material respects, effective internal control over financial reporting as of December 31, 2010.

The Audit and Finance Committee reviewed with Ernst & Young LLP and pre-approved their proposed
audit plans, audit scope, identification of audit risks and fees, either by vote of the Committee or by approval of
the Committee’s authorized delegate acting between meetings. The Audit and Finance Committee also reviewed
and pre-approved all non-audit services performed by Ernst & Young LLP and discussed with the independent
public accountants their independence.

In reliance on the reviews and discussions referred to above,

the Audit and Finance Committee
recommended to the Board of Directors (and the Board of Directors has approved) that the Company’s audited
financial statements be included in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2010.

William G. Ferko (Chairman)
Sidney R. Petersen
Robert Sroka

PROPOSAL ONE
ELECTION OF DIRECTORS

The Board of Directors is divided into three classes with terms that expire at successive annual meetings.
Three Class III directors will be elected at the Annual Meeting to serve for a three-year term expiring at our
annual meeting in 2014 or until their successors have been elected and qualified, or until the earliest of their
death, resignation or retirement. We expect each nominee for election as a director at the Annual Meeting to be
able to serve if elected. If any nominee is unable to serve, proxies will be voted in favor of the remainder of those
nominees and for such substitute nominee as may be selected by the Board of Directors.

The Board of Directors has nominated William G. Ferko, Jeffrey T. Gill and Sidney R. Petersen to be
elected at the Annual Meeting as Class III directors whose terms will expire in 2014. All nominees are current
Directors.

Set forth below are the principal occupation and certain other information (“Biographies”) regarding the
nominees and the other directors whose terms of office will continue after the Annual Meeting. The Biographies
of each of the nominees and continuing directors that follows contains information regarding the person’s service
as a director, business experience, director positions held currently or at any time during the last five years,
information regarding involvement
if applicable, and the
experiences, qualifications, attributes or skills that caused the Nominating and Governance Committee and the
Board to determine that the person should serve as a director for the Company beginning in 2011.

in certain legal or administrative proceedings,

Vote Required and Recommendation of the Board of Directors

Nominees receiving the greatest number of votes duly cast for the election of directors will be elected.
Abstentions and shares held by a broker, as nominee and not voted, are not counted as votes cast for purposes of,
and therefore will have no impact as to, the election of directors. The Board of Directors recommends a vote
FOR the election of the above-named nominees as Class III directors.

CLASS III DIRECTOR NOMINEES FOR TERMS EXPIRING IN 2014

William G. Ferko . . . . . .
Age 56

Jeffrey T. Gill
Age 55

. . . . . . . . .

Sidney R. Petersen . . . . .
Age 80

William G. Ferko has served as a director of Sypris since January 2005. Mr. Ferko
has served as Senior Vice President and Chief Risk Management Officer for
Republic Bank & Trust Company since April 2009. From January 2008 through
January 2009, Mr. Ferko served as Chief Financial Officer for Philips BU
Professional Luminaires North America, a manufacturer of lighting fixtures and
controls. From 1998 through January 2008, he served as Vice President and Chief
Financial Officer of Genlyte Group Incorporated, the predecessor to Philips BU
Professional Luminaires North America. Prior to 1998, he served in several finance
positions for Tenneco Inc., including its automotive and packaging divisions and as
Chief Financial Officer for Monroe Auto Equipment Company and Goss Graphic
Systems. Mr. Ferko is Chairman of the Audit and Finance Committee and a
member of the Nominating and Governance Committee. The Nominating and
Governance Committee believes that based on his experience and expertise in
finance, accounting and audit functions, and public policy, Mr. Ferko’s continued
service as a director is in the Company’s best interest.

Jeffrey T. Gill has served as President and Chief Executive Officer of Sypris and its
predecessor since 1992, and as Executive Vice President of its predecessor from
1983 to 1992. Mr. Gill holds a BS degree in Business Administration from the
University of Southern California and an MBA from Dartmouth College. Mr. Gill
has served as a director of Sypris and its predecessor since 1983. Jeffrey T. Gill is
the son of Robert E. Gill and the brother of R. Scott Gill. The Nominating and
Governance Committee believes that based on his experience and expertise in
financial matters and management, Mr. Gill’s continued service as a director is in
the Company’s best interest.

Sidney R. Petersen has served as a director of Sypris since 1997 and of Sypris
Electronics from 1994 until its merger with Sypris in 1998. Mr. Petersen retired as
Chairman of the Board and Chief Executive Officer of Getty Oil in 1984, where he
served in a variety of increasingly responsible management positions since 1955.
He is a member of the Audit and Finance Committee. The Nominating and
Governance Committee believes that based on his experience and expertise in
financial matters, accounting and audit, financial markets, capital allocation,
strategic planning and as a former public company Chief Executive Officer and
Board Chairman, Mr. Petersen’s continued service as a director
is in the
Company’s best interest.

CLASS I DIRECTORS WHOSE TERMS EXPIRE IN 2012

John F. Brinkley . . . . . . .
Age 73

John F. Brinkley has served as a director of Sypris since April 2005. Mr. Brinkley
retired as General Manager, North American Automotive Operations Export Sales
for Ford Motor Company in 1995 after a 33 year career with Ford. He also served
in a variety of responsible management positions with Ford in Europe, including
Vice President of Marketing, Director of Southern Europe Sales Operations and
Director of Truck Operations. Mr. Brinkley is Chairman of the Compensation
Committee and a member of the Nominating and Governance Committee. The
Nominating and Governance Committee believes that based on his experience and
expertise in the general management, strategic planning and management,
marketing, and leadership of a large organization in the automotive sector,
Mr. Brinkley’s continued service as a director is in the Company’s best interest.

Robert E. Gill
Age 85

. . . . . . . . .

William L. Healey . . . . . .
Age 66

Robert E. Gill has served as Chairman of the Board of Sypris and its predecessor
since 1983, and as President and Chief Executive Officer of its predecessor from
1983 to 1992. Prior to 1983, Mr. Gill served in a number of senior executive
positions, including Chairman, President and Chief Executive Officer of Armor
Elevator Company, Vice President of A. O. Smith Corporation and President and
Chief Executive Officer of Elevator Electric Company. Mr. Gill holds a BS degree
in Electrical Engineering from the University of Washington and an MBA from the
University of California at Berkeley. Robert E. Gill is the father of Jeffrey T. Gill
and R. Scott Gill. The Nominating and Governance Committee believes that based
on his experience and expertise in financial matters, strategic planning and
executive management, Mr. Gill’s continued service as a director is in the
Company’s best interest.

William L. Healey has served as a director of Sypris since 1997. Mr. Healey
currently serves as a private investor and business consultant. From 2002 to 2005,
he served as President and Chief Executive Officer of Cal Quality Electronics, an
electronics manufacturing company. Mr. Healey served as a private investor and
consultant from 1999 to 2002. He served as Chairman of the Board of Smartflex
Systems, an electronics manufacturing company, from 1996 to 1999 and as its
President and Chief Executive Officer
from 1989 to 1999. Prior to 1989,
Mr. Healey served in a number of senior executive positions with Silicon Systems,
including Senior Vice President of Operations. Mr. Healey also serves as a director
of Microsemi Corporation and Pro-Dex Inc. Mr. Healey is Chairman of the
Nominating and Governance Committee and is a member the Compensation
Committee. The Nominating and Governance Committee believes that based on his
experience and expertise in strategic planning and as a former public company
Chief Executive Officer in the electronics sector, Mr. Healey’s continued service as
a director is in the Company’s best interest.

CLASS II DIRECTORS WHOSE TERMS EXPIRE IN 2013

R. Scott Gill . . . . . . . . . . .
Age 52

R. Scott Gill has served as a director of Sypris and its predecessor since 1983.
Mr. Gill has served as Managing Broker for Baird & Warner, a residential real
estate brokerage firm, since June 2007. From June 2005 to June 2007, he served as
a Managing Member of Astor & Longwood, LLC, a real estate development and
investment company. Mr. Gill served as a Managing Broker with Coldwell Banker
Residential Brokerage from 2003 to 2005 and as a Managing Broker and Associate
with Koenig & Strey GMAC Real Estate, a residential real estate firm from 1999 to
2003. Mr. Gill served as Senior Vice President and Secretary of Sypris from 1997
to 1998, and as Vice President and Secretary of its predecessor from 1983 to 1998.
R. Scott Gill is the son of Robert E. Gill and the brother of Jeffrey T. Gill. The
Nominating and Governance Committee believes that based on his experience, in-
depth knowledge of the company and expertise in public policy and business
management, Mr. Gill’s continued service as a director is in the Company’s best
interest.

Robert Sroka . . . . . . . . . .
Age 61

Robert Sroka has served as a director of Sypris since 1997. Mr. Sroka has served as
Principal of Rockland Advisory Group, an investment banking firm since May
2010, and served as Managing Director of Corporate Solutions Group, LLC, an
investment banking firm, from December 2003 until May 2010. Mr. Sroka also
served as Managing Partner of Lighthouse Partners, a private investment and
business consulting company from 1998 to 2005. From June 2007 until his
resignation in August 2009, Mr. Sroka was a Director of North Shore Acquisition
Corp., a blank check company. From November 2004 until February 2007,
Mr. Sroka was a Vice President of Ardent Acquisition Company, a blank check
company that merged with Avantair, Inc. Mr. Sroka served as Managing Director
of Investment Banking-Mergers and Acquisitions, for J.P. Morgan from 1994 to
1998. Prior to 1994, Mr. Sroka served in a variety of senior executive positions
including Vice President-Investment Banking and Vice
with J.P. Morgan,
President-Corporate Finance. He also serves as a Director of Stampede Meats, Inc.
a supplier of processed meat products since 2008. He served as a director of North
American Insurance Leaders, Inc., a blank check company that was liquidated in
May 2008 and as non-executive chairman of the board of Avado Brands, Inc., an
operator of restaurants from November 2003 until May 2005. On February 4, 2004,
Avado Brands, Inc. filed a voluntary petition under the federal bankruptcy laws,
from which it emerged in May 2005. He is a member of the Audit and Finance
Committee, the Compensation Committee and the Lead Independent Director. The
Nominating and Governance Committee believes that based on his experience and
expertise in finance, investment banking and diverse board service and as a former
public company executive officer, Mr. Sroka’s continued service as a director is in
the Company’s best interest.

STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

The following table sets forth information concerning the beneficial ownership of our Common Stock as of
March 17, 2011 for (a) each director and nominee for director of the Company; (b) each person who is known by
us to own 5% or more of our Common Stock; (c) the person who in 2010 served as the President and Chief
Executive Officer of the Company; (d) the two other most highly compensated executive officers named in the
Summary Compensation Table; and (e) the directors and executive officers as a group. Except as otherwise
noted, the persons named in the table have sole voting and investment power with respect to such securities.

Robert E. Gill (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
253 Canton Avenue East
Winter Park, Florida 32789

Shares Beneficially Owned
Common Stock

Number

Percent

16,000

Jeffrey T. Gill (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
101 Bullitt Lane, Suite 450
Louisville, Kentucky 40222

6,046,734

30.7%

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

R. Scott Gill (3)
161 East Chicago Avenue
Chicago, Illinois 60611

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

GFP I, LP (4)
1220 North Market Street, Suite 606
Wilmington, Delaware 19801

5,665,495

28.8%

3,274,666

16.7%

Gill Family Capital Management, Inc. (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
101 Bullitt Lane, Suite 450
Louisville, KY 40222

3,274,666

16.7%

John F. Brinkley (6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
William G. Ferko (7)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
William L. Healey (8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sidney R. Petersen (9)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Robert Sroka (10) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
John J. Walsh (11)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Brian A. Lutes (12) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current directors and executive officers as a group (14 persons) (13) . . . . . . . . . . . . . . .

38,979
54,709
56,902
98,537
135,026
140,086
95,036
9,704,962

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dimensional Fund Advisors Inc. (14)
Needham Investment Management, LLC (15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,472,541
1,012,800

*
*
*
*
*
*
*
48.7%

7.3%
5.2%

Less than 1%.

(1) Does not include 3,274,666 shares of the Common Stock of the Company owned by GFP I, LP, a Delaware
limited partnership, of which Robert E. Gill’s children share beneficial ownership. Pursuant to certain
provisions of the Partnership Agreement, Robert E. Gill may be deemed to beneficially own shares of
Common Stock attributable to the General Partner; however, Mr. Gill disclaims beneficial ownership
relating to all shares held in GFP I, LP. Mr. Gill is a director and executive officer of the Company.

(2) Stock ownership for Jeffrey T. Gill includes 38,828 shares issuable under currently exercisable stock
options and 23,975 shares owned by Patricia G. Gill, his wife. Jeffrey T. Gill shares voting and investment
power with his spouse with respect to these shares. Also includes 3,274,666 shares held by GFP I, LP, of
which Jeffrey T. Gill is a limited partner holding a 38.20% ownership interest, of which Patricia G. Gill is a
limited partner holding a 2.29% ownership interest, and of which trusts for the benefit of Jeffrey T. Gill’s

children, of which Jeffrey T. Gill is trustee, are limited partners holding an aggregate of 17.61% ownership
interest. Gill Family Capital Management, Inc., a Kentucky corporation (the “General Partner”), is the
general partner of GFP I, LP, with a 0.96% ownership interest in GFP I, LP. Jeffrey T. Gill is the
Co-President and Treasurer of the General Partner, is one of two directors of the General Partner, and is a
50% shareholder of the General Partner. On the basis of Jeffrey T. Gill’s positions with the General Partner,
and pursuant to certain provisions of the Partnership Agreement, Jeffrey T. Gill may be deemed to
beneficially own shares of Common Stock attributable to the General Partner. Mr. Gill is also a director and
executive officer of the Company and was a named officer during 2010.

(3)

Includes 27,724 shares issuable under currently exercisable stock options. Includes 3,274,666 shares owned by
GFP I, LP, of which R. Scott Gill is a limited partner holding a 40.95% ownership interest. R. Scott Gill is the
Co-President and Secretary of the General Partner, is one of two directors of the General Partner, and is a 50%
shareholder of the General Partner. On the basis of R. Scott Gill’s positions with the General Partner, and
pursuant to certain provisions of the Partnership Agreement, R. Scott Gill may be deemed to beneficially own
shares of Common Stock attributable to the General Partner. Mr. Gill is also a director of the Company.

(4) Voting and investment power is exercised through the General Partner. See footnotes (2) and (3).

(5)

In its capacity as General Partner. See footnotes (2) and (3).

(6)

Includes 11,381 shares issuable under currently exercisable stock options and 27,598 shares held by a family
trust of which Mr. Brinkley is a trustee. Mr. Brinkley shares voting and investment power with respect to the
shares held by the family trust.

(7)

Includes 5,175 shares issuable under currently exercisable stock options.

(8)

(9)

Includes 19,434 shares issuable under currently exercisable stock options, and 37,468 shares held by a
family trust of which Mr. Healey is a co-trustee. Mr. Healey shares voting and investment power with
respect to the shares held by the family trust.

Includes 19,896 shares issuable under currently exercisable stock options, and 78,641 shares held by a
family trust of which Mr. Petersen is a trustee. Mr. Petersen shares voting and investment power with
respect to the shares held by the family trust.

(10) Includes 117,173 shares issuable under currently exercisable stock options.

(11) Includes 18,000 shares issuable under currently exercisable stock options.

(12) Mr. Lutes was a named executive officer during 2010.

(13) Includes 349,839 shares issuable under currently exercisable stock options.

(14) Based on a Schedule 13G filed February 11, 2011 with the SEC by Dimensional Fund Advisors LP and dated
December 31, 2010. According to the filing, Dimensional Fund Advisors LP serves as investment manager to
certain other commingled group trusts and separate accounts (such investment companies, trusts and accounts,
collectively referred to as the “Funds”). In certain cases, subsidiaries of Dimensional Fund Advisors LP may
act as an adviser or sub-adviser to certain Funds. In its role as investment advisor, sub-adviser and/or manager,
neither Dimensional Fund Advisors LP nor its subsidiaries (collectively, “Dimensional”) do possess voting
and/or investment power over the securities that are owned by the Funds, and may be deemed to be the
beneficial owner of the shares held by the Funds. However, all securities reported in the schedule were owned
by the Funds. Dimensional disclaims beneficial ownership of the securities. The address of Dimensional is
Palisades West, Building One, 6300 Bee Cave Road, Austin, Texas, 78746.

(15) Based on a Schedule 13G filed February 12, 2010 with the SEC by Needham Investment Management, LLC
and dated December 31, 2009. According to the filing, Needham Investment Management, LLC
(“Needham”) serves as investment adviser to various series of The Needham Funds, Inc. and general partner
to certain private investment funds that hold 1,012,800 shares and may be deemed to beneficially own these
shares by virtue of its role as investment adviser. Needham also possesses shared voting and dispositive
power over these shares. The address of Needham is 445 Park Avenue, New York, New York, 10022.

SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors, executive officers
and persons who beneficially own more than 10% of Sypris Common Stock to file reports of holdings and
transactions in Sypris stock with the Securities and Exchange Commission. Based on our information, we believe
that all Section 16(a) Securities and Exchange Commission filing requirements applicable to our directors,
officers and other beneficial owners for 2010 were timely met.

EXECUTIVE OFFICERS

Executive officers of the Company are appointed by the Board of Directors and serve at the discretion of the
Board of Directors. Set forth below are the ages, positions and certain other information regarding the executive
officers of the Company.

Robert E. Gill . . . . . . . . . . . . .
Age 85

Jeffrey T. Gill . . . . . . . . . . . . .
Age 55

Paul G. Larochelle . . . . . . . . .
Age 56

John J. Walsh . . . . . . . . . . . . .
Age 52

Robert E. Gill has served as Chairman of the Board of Sypris and its
predecessor since 1983, and as President and Chief Executive Officer of its
predecessor from 1983 to 1992. Prior to 1983, Mr. Gill served in a number of
senior executive positions, including Chairman, President and Chief Executive
Officer of Armor Elevator Company, Vice President of A. O. Smith
Corporation and President and Chief Executive Officer of Elevator Electric
Company. Mr. Gill holds a BS degree in Electrical Engineering from the
University of Washington and an MBA from the University of California at
Berkeley. Robert E. Gill is the father of Jeffrey T. Gill and R. Scott Gill.

Paul G. Larochelle has served as Vice President of Sypris and as President of
its subsidiary, Sypris Technologies, Inc., since October 2009. From 1980 to
2009, Mr. Larochelle served in a number of increasingly responsible executive
positions with Dana Corporation, a tier one automotive and heavy truck
supplier. Most recently, Mr. Larochelle served as Vice President of the
Structural Products Group from 2007 to 2009 and as Vice President of
from 2004 to 2007 with Dana
Engineering and Program Management
Corporation. During his tenure with Dana Corporation, Mr. Larochelle served
as a member of the Executive Committee and on the Boards of Dana Canada
and Chassis Systems, Ltd., a Dana joint venture in the United Kingdom. Mr.
Larochelle holds a Bachelor of Science Degree in Engineering from Carleton
University, Ottawa, Ontario, Canada and is fluent in French.

John J. Walsh has served as Vice President of Sypris since July 2008, and as
President of its subsidiary, Sypris Electronics, since March 2008 to the present.
Mr. Walsh served as Corporate Executive Vice President of Strategy,
Technology and Development for Ducommun Incorporated, a provider of
aerospace and defense engineering and manufacturing services, and as
President of Ducommun Technologies, a wholly-owned subsidiary of
Ducommun Incorporated, from March 2004 to March 2008. From May 1999
through March 2004, he served as Executive Vice President and Chief
Operating Officer for Special Devices, Inc., a provider of engineered energetic
devices for the Automotive, Defense & Aerospace, and Mining & Blasting
industries. Mr. Walsh holds a BS degree in Aeronautical and Astronautical
Engineering from Purdue University, an Executive MBA from St. Joseph’s
University and patents for aerospace, automotive and commercial mining and
blasting applications.

Brian A. Lutes . . . . . . . . . . . .
Age 46

Richard L. Davis . . . . . . . . . .
Age 57

John R. McGeeney . . . . . . . .
Age 54

Anthony C. Allen . . . . . . . . . .
Age 52

Brian A. Lutes has served as Vice President and Chief Financial Officer of
Sypris since September 2008. From 2007 to 2008, Mr. Lutes served as Vice
Chairman of Finance and Administration for MAG Industrial Automation
Systems, a leading manufacturer of machine tools and systems serving the
aerospace, automotive, construction, power generation and other durable goods
industries. He served as Chief Financial Officer and Vice President of Finance
and Administration for The Wornick Company, a provider of shelf-stable,
ready-to-eat meals to military and consumer branded food companies, from
2005 to 2007 and as Senior Vice President for Fifth Third Bancorp from 2002
to 2004. Prior to 2002, Mr. Lutes served with the General Electric Company for
seventeen years in a number of increasingly responsible executive positions
within GE and GE Capital culminating with his assignment as Chief Financial
Officer of Global Operations for GE Medical Systems. Mr. Lutes holds
Bachelor and Masters degrees in Mechanical Engineering from the University
of Louisville’s Speed School of Engineering and an MBA from the University
of Connecticut’s Executive MBA program.

Richard L. Davis has served as Senior Vice President of Sypris since 1997, as
Secretary from 1998 to 2003 and as Vice President and Chief Financial Officer
of its predecessor from 1985 to 1997. Prior to 1985, Mr. Davis served in a
number of management positions with Armor Elevator and Coopers and
Lybrand. Mr. Davis holds a BS degree in Business Administration from
Indiana University and an MBA from the University of Louisville. He is a
certified public accountant in the state of Kentucky.

John R. McGeeney has served as General Counsel and Secretary of Sypris
since June 2003. Mr. McGeeney was Of Counsel to Middleton and Reutlinger,
a law firm, in 2003, and served as General Counsel for Inviva, Inc., an
insurance holding company, from 2000 to 2002. Mr. McGeeney also served in
several senior leadership positions, including General Counsel and Secretary,
with ARM Financial Group, a financial services company, from 1994 to 1999,
and as Counsel and Assistant General Counsel
for Capital Holding
Corporation, a financial services company, from 1988 to 1994. Mr. McGeeney
holds a BA degree from Amherst College and a JD degree from the University
of Notre Dame Law School.

Anthony C. Allen has served as Vice President, Treasurer and Assistant
Secretary of Sypris since December 2004 and as Vice President of Finance and
Information Systems and Assistant Secretary of Sypris from 2003 to December
2004. Mr. Allen served as Vice President, Controller and Assistant Secretary of
Sypris from 1997 to 2003. He served as Vice President of Finance of Sypris’
predecessor from 1994 to 1998 and as Vice President and Controller from 1987
to 1994. Prior to 1987, Mr. Allen served in a variety of management positions
with Armor Elevator. Mr. Allen holds a Bachelors degree in Business
Administration from Eastern Kentucky University and an MBA from
Bellarmine University. He is a certified public accountant in the state of
Kentucky.

SUMMARY COMPENSATION TABLE

The following table sets forth information concerning the compensation of the Company’s President and
Chief Executive Officer, and the two other most highly compensated executive officers who served in such
capacities as of December 31, 2010 (the “named executive officers”), for services rendered to the Company
during the past fiscal year.

Name and
Principal Position
(a)

J. T. Gill, President and Chief

Executive Officer

J. J. Walsh, Vice President

B. A. Lutes, Vice President &
Chief Financial Officer

Year
(b)

2010
2009

Salary
($)
(c)

535,385
510,436

Bonus
($)
(d)(1)

—
—

Stock
Awards
($)
(e)(2)

Option
Awards
($)
(f)(2)

All Other
Compensation
($)
(i)(3)

— 243,744
— 122,070

324,063
302,829

95,000

71,250
— 61,500

285,769
284,105

— 71,250
41,000

95,000

—
—

Total
($)
(j)

835,655
668,742

527,602
405,254

452,309
483,948

56,526
36,236

37,289
40,925

95,290
63,843

(1) The amounts in column (d) reflect bonus payments made to Mr. Walsh relating to his achievement of certain
goals related to the reorganization of the Electronics Group and positioning the Company for future growth
opportunities and to Mr. Lutes in recognition for his role in the disposition of Sypris Test & Measurement in
2009.

(2) The amounts in column (e) and in column (f) reflect aggregate grant date fair value for each stock and
option award granted during each fiscal year for each named executive officer, in accordance with ASC
Topic 718. Assumptions used in the calculation of these amounts in 2010 are included in Note 16 to the
Company’s audited financial statements for the fiscal year ended December 31, 2010 included in the
Company’s Annual Report on Form 10-K filed with the SEC and in Note 17 to the Company’s audited
financial statements for the fiscal year ended December 31, 2009 included in the Company’s Annual Report
on Form 10-K filed with the SEC.

(3) The amounts in column (i) include the aggregate dollar amounts of all perquisites and other compensation
offered by the Company which included auto leases or auto allowances for personal and business use,
relocation expenses (for Mr. Lutes), Company 401(k) matching contributions, premiums on executive life
insurance, premiums on long-term disability coverage, premiums for long-term care insurance (for Mr. Gill
and his spouse), and a variety of other, routine perquisites, including complimentary or discounted food and
drink, executive coaching, entertainment and related travel, clothing, gifts or similar benefits which in the
aggregate are less than $10,000 in value per year.

All employees in the United States not covered by a collective bargaining agreement are automatically
enrolled in the Company’s 401(k) retirement savings plan, a tax-qualified plan, at a pre-tax contribution rate of
3%. Employees may opt out of the plan or may elect to change their contribution in increments of 1% of pre-tax
salary. Historically, the Company has contributed a matching amount of 100% of the participating employees’
first 3% of eligible salary. In April of 2009, the Company suspended the matching contribution at the Board’s
discretion. In October of 2010, the Company reinstated an incremental matching contribution of 1% at the
Board’s discretion and will continue to evaluate future increases in matching. Company contributions vest at the
rate of 20% per year with 100% vesting attained at 5 years of service.

Stock options and restricted stock awards granted in 2010 and 2009 were awarded under the 2004 Sypris
Equity Plan (“2004 Plan”), are subject to accelerated vesting upon any change of control of the Company,
pursuant to the terms of the 2004 Plan. The respective values of the unvested stock options and the unvested
shares of restricted stock which would have become vested for the named executive officers in the event of a
change in control, calculated as of December 31, 2010, would have been as follows: $1,213,645 for Mr. Gill,
$522,125 for Mr. Lutes and $506,575 for Mr. Walsh. For stock options, these valuations reflect (i) the number of

each such individual’s unvested stock options on December 31, 2010, multiplied by (ii) the amount, if any, by
which the Company’s stock price on, December 31, 2010, which was the last trading day of 2010, exceeded the
strike price of such options. For restricted stock, these valuations reflect (i) the number of each such individual’s
unvested shares of restricted stock on December 31, 2010, multiplied by (ii) the Company’s stock price on
December 31, 2010.

In March of 2009, the Company reduced Mr. Gill’s salary by 20%, and the salaries of certain other
executive officers, including Mr. Lutes, by 15%. In July of 2010 the Company reinstated the salary for Mr. Gill
and the other executive officers back to the 2008 levels, including Mr. Lutes. Effective as of March 2, 2011, the
Company’s executive officers and certain other key employees, including Mr. Lutes and Mr. Walsh, entered into
one-year employment agreements with the Company which expire on March 2, 2012. If terminated without cause
then (i) these employees would continue to receive their current salary for a period of 12 months following the
date of termination, provided that if they became employed by another entity during such time, these employees
would only receive 30% of such salary, and (ii) all of the employee’s outstanding restricted stock and stock
options would become 100% vested and remain exercisable until the expiration date then in effect for any such
stock options. The employment agreements also contain confidentiality, non-compete and non-solicitation
covenants by the employee during the term of the agreement. Effective May 9, 2009, the Company’s executive
officers and certain other key employees, including Mr. Lutes and Mr. Walsh, entered into Three-Year Bonus
Agreements which upon vesting, on May 9, 2012 would require payments to Mr. Lutes and Mr. Walsh, of
$450,000, respectively. If terminated without cause before May 9, 2012, these employees would be entitled to
receive a pro rata portion of the three-year bonus within thirty (30) days of such termination date, and this
Agreement will automatically terminate without further notice or obligation by the Company. All or any portion
of the three-year bonus award may be paid in common stock (valued at its closing price on May 8, 2012, or any
earlier termination date), at the sole election of the Board.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2010

OPTION AWARDS

STOCK AWARDS

Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
(c)

12,000
18,828

Number of
Securities
Underlying
Unexercised
Options(#)
Unexercisable
(d)

8,000(1)

300,000(2)
131,889(2)
60,000(3)

Option
Exercise
Price ($)
(e)

10.36
4.31
0.82
2.85
4.13

Option
Expiration
Date
(f)

3/1/2012
3/30/2012
2/25/2014
3/2/2015
3/31/2014

60,000(4)

2.10

9/15/2015

Number
of Shares or
Units of
Stock
That Have
Not Vested
(#)
(g)

Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested
($)
(h)(9)

30,000(5) 127,500
12,500(6)
53,125
50,000(7) 212,500
25,000(7) 106,250

30,000(8) 127,500
53,125
12,500(6)
25,000(7) 106,250
25,000(7) 106,250

Name
(a)

J. T. Gill

J. J. Walsh

B. A. Lutes

Grant Date
(b)

3/2/2006
3/31/2008
2/25/2009
3/2/2010
3/31/2008
3/31/2008
2/25/2009
2/25/2009
3/2/2010
9/15/2008
9/15/2008
2/25/2009
2/25/2009
3/2/2010

(1) Stock option awards which vest 30%, 30% and 40% on the third, fourth and fifth anniversary of the grant
date, respectively, of the six-year option term. The remaining unvested shares will vest on March 2, 2011.

(2) Stock option awards which vest 100% on the third anniversary of the grant date, with a five-year option

term.

(3) Stock option awards which vest 30%, 30% and 40% on March 31, 2011, March 31, 2012 and March 31,

2013, respectively, of the six-year option term.

(4) Stock option awards which vest 30%, 30% and 40% on September 15, 2011, September 15, 2012 and

September 15, 2013, respectively, of the six-year option term.

(5) Restricted stock awards which vest in one-third increments on March 31, 2011, March 31, 2013 and

March 31, 2015.

(6) Restricted stock award which vests 50% on the first and second anniversary of the grant date. The remaining

unvested restricted shares will vest on February 25, 2011.

(7) Restricted stock award which vests 100% on the third anniversary of the grant date.

(8) Restricted stock awards which vest in one-third increments on September 15, 2011, September 15, 2013 and

September 15, 2015.

(9) Market value of shares that have not vested in column (h) was calculated using the closing stock price on

December 31, 2010.

Name
(a)(1)

J. F. Brinkley
W. G. Ferko
R. E. Gill(4)
R. S. Gill
W. L. Healey
S. R. Petersen
R. Sroka

2010 DIRECTOR COMPENSATION

Fees Earned or Paid in
Cash ($)
(b)

Stock Awards ($)
(c)(3)

All Other
Compensation
($)
(g)(2)

43,500
44,000
—
31,000
41,250
38,500
44,750

17,680
17,680
—
17,680
17,680
17,680
17,680

2,000
2,000
244,971
2,000
2,000
2,000
2,000

Total ($)
(h)

63,180
63,680
244,971
50,680
60,930
58,180
64,430

(1) The Directors listed in column (a) had the following aggregate amounts of option awards outstanding at
fiscal year end (Mr. Brinkley 11,381, Mr. Ferko 5,175, Mr. R. Scott Gill 27,724, Mr. Healey 19,434,
Mr. Petersen 19,896 and Mr. Sroka 117,173).

(2) The amount provided in column (g) represents the annual salary plus the aggregate dollar amount of all
perquisites for Mr. R. E. Gill as an executive officer of the Company including an auto lease for personal
and business use, and a term life policy. Additionally, for each of the named Directors the aggregate dollar
amount includes a variety of routine perquisites, including complimentary or discounted food, drink,
entertainment and related travel, clothing, gifts or similar benefits which in the aggregate do not exceed
$2,000 in value per year.

(3) The amounts in column (c) reflect the dollar amounts for the aggregate grant date fair value for each stock
award granted during 2010 for each Director, in accordance with FASB ASC Topic 718, awarded pursuant
to the 2004 Sypris Equity Plan and the Directors Compensation Program. Because these awards consisted of
fully vested shares, the amounts in column (c) are equal to the fair value of all shares awarded in 2010,
valued at the closing price of the Company’s common stock as of the time of the award.

(4) Mr. R. E. Gill does not receive separate compensation for his services as a director in addition to his total
compensation for services as an executive officer. Mr. R. E. Gill is also the father of the Company’s
president and chief executive officer, Jeffery T. Gill.

In 2010, non-employee directors (John F. Brinkley, William G. Ferko, R. Scott Gill, William L. Healey,
Sidney R. Petersen and Robert Sroka) each received an annual retainer ranging from approximately $33,000 to
$45,000, payable after each quarter, in equal cash installments. Additionally, non-employee directors received
5,200 shares of common stock, bringing the value of total compensation excluding perquisites, to a range of
approximately $48,680 to $62,000.

All directors are reimbursed for travel and related expenses for attending Board and Committee meetings. In
2010, the Company held four meetings which required board members to travel. We also provide non-employee
directors with travel accident insurance when on Company business. Directors who are employees of Sypris or its
affiliates are not eligible to receive compensation for services as a director.

AVAILABILITY OF REPORT ON FORM 10-K

A stockholders’ letter and a copy of our Annual Report on Form 10-K, which together constitute our
Annual Report to Stockholders, has been mailed concurrently with this Proxy Statement to stockholders
entitled to notice of and to vote at the Annual Meeting. Such Annual Report is not incorporated into this
Proxy Statement and shall not be considered proxy solicitation material. Stockholders may also request a
copy of the Company’s Report on Form 10-K which may be obtained without charge by writing to
John R. McGeeney, Secretary, Sypris Solutions, Inc., 101 Bullitt Lane, Suite 450, Louisville, Kentucky
40222.

OTHER MATTERS

The Board of Directors does not intend to bring any other matter before the Annual Meeting and has not
been informed that any other matter is to be presented by others. If any other matter properly comes before the
Annual Meeting, the proxies will be voted with the discretion of the person or persons voting the proxies.

You are cordially invited to attend the Annual Meeting. Whether or not you plan to attend the Annual
Meeting, please vote your shares over the Internet or by telephone, or mark, sign, date and promptly return the
proxy card sent to you in the envelope provided. No postage is required for mailing in the United States.

SUBMISSION OF STOCKHOLDER PROPOSALS

Any stockholder who intends to present a proposal at the Annual Meeting in the year 2012 must deliver the

proposal to the Company’s corporate Secretary at 101 Bullitt Lane, Suite 450, Louisville, Kentucky 40222:

• Not later than December 8, 2011, if the proposal is submitted for inclusion in our proxy materials for

that meeting pursuant to Rule 14a-8 under the Securities Act of 1934.

•

Stockholder proposals received after February 21, 2012, will be considered untimely, and the proxies
solicited by Sypris for next year’s annual meeting may confer discretionary authority to vote on any
such matters without a description of them in the proxy statement for that annual meeting.

John R. McGeeney
General Counsel and Secretary

April 1, 2011