Edgar Filing: APOGEE ENTERPRISES, INC.

Definitive Proxy Statement

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Apogee Enterprises, Inc.

(Name of Registrant as Specified in Its Charter)

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LOGO

May 9, 2011

Dear Shareholder:

You are cordially invited to attend the 2011 Annual Meeting of Shareholders of Apogee Enterprises, Inc. to be held at Apogee’s headquarters, 4400 West 78^th Street, Suite 520, Minneapolis, Minnesota, commencing at 9:00 a.m. Central Daylight Time on Wednesday, June 22, 2011.

The Corporate Secretary’s formal notice of the meeting and the proxy statement appear on the following pages and describe the matters to come before the meeting. During the meeting, time will be provided for a review of the activities of the past year and items of general interest about Apogee.

We hope that you will be able to attend the meeting, and we look forward to seeing you. Even if you plan to attend the meeting, we urge you to vote your shares either by Internet or mail as promptly as possible so your shares will be represented at the annual meeting. Instructions on voting your shares are on the Notice of Internet Availability of Proxy Materials you received for the annual meeting. If you received paper copies of our proxy materials, instructions on the two ways to vote your shares can be found on the enclosed proxy form. Internet voting facilities for shareholders of record will be available 24 hours a day and will close at 11:59 p.m. Eastern Daylight Time (10:59 p.m. Central Daylight Time) on June 21, 2011. If you attend the meeting in person, you may at that time revoke any proxy previously given and vote in person, if desired.

Sincerely,




Russell Huffer		Bernard P. Aldrich
Chief Executive Officer		Chairman of the Board

APOGEE ENTERPRISES, INC.

4400 West 78^th Street

Suite 520

Minneapolis, MN 55435

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

to be held on June 22, 2011

NOTICE IS HEREBY GIVEN that the 2011 Annual Meeting of Shareholders of Apogee Enterprises, Inc. will be held at Apogee’s headquarters, 4400 West 78^th Street, Suite 520, Minneapolis, Minnesota, commencing at 9:00 a.m. Central Daylight Time on Wednesday, June 22, 2011 for the following purposes:

To elect three Class I directors for three-year terms ending in the year 2014;

To conduct a non-binding advisory vote on Apogee’s executive compensation;

To conduct a non-binding advisory vote on the frequency of an advisory vote on Apogee’s executive compensation;

To consider and act upon a proposal to amend the Apogee Enterprises, Inc. 2009 Stock Incentive Plan;

To consider and act upon a proposal to amend the Apogee Enterprises, Inc. 2009 Non-Employee Director Stock Incentive Plan;

To ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending March 3, 2012; and

To transact such other business as may properly be brought before the meeting.

The Board of Directors has fixed May 3, 2011 as the record date for the meeting. Only shareholders of record at the close of business on that date are entitled to receive notice of and to vote at the meeting.

Pursuant to rules adopted by the Securities and Exchange Commission, we have elected to provide access to our proxy materials over the Internet. Accordingly, we have sent our shareholders a Notice of Internet Availability of Proxy Materials (the “Notice”) containing instructions on how to access our 2011 proxy statement and our fiscal 2011 Annual Report to Shareholders online. Shareholders who have received the Notice will not be sent a printed copy of our proxy materials in the mail unless they request to receive a printed copy.

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be held on June 22, 2011: Our 2011 Proxy Statement and our Fiscal 2011 Annual Report to Shareholders are available at www.proxyvote.com.

By Order of the Board of Directors,

Patricia A. Beithon

General Counsel and Corporate Secretary

Minneapolis, Minnesota

May 9, 2011

PROXY STATEMENT

TABLE OF CONTENTS


QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND VOTING			1

What is the purpose of the meeting?			1
Why did I receive a notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?			1
How do I get electronic access to the proxy materials?			1
Who is entitled to vote at the meeting?			1
What are my voting rights?			2
How many shares must be present to hold the meeting?			2
How do I vote my shares?			2
What is a proxy?			2
What is a proxy statement?			3
What is the difference between a shareholder of record and a “street name” holder?			3
How do I vote if my shares are held in the 401(k) retirement plan, employee stock purchase plan or other plans of Apogee?			3
What does it mean if I receive more than one Notice of Internet Availability of Proxy Materials or proxy card?			3
Can I vote my shares in person at the meeting?			4
What vote is required for the election of directors or for a proposal to be approved?			4
How are votes counted?			4
Who will count the vote?			5
How does the Board of Directors recommend that I vote?			5
What if I do not specify how I want my shares voted?			5
Can I change my vote after submitting my proxy or voting instructions?			6
Will my vote be kept confidential?			6
How can I attend the meeting?			6
Who pays for the cost of proxy preparation and solicitation?			6
How can I communicate with the Board of Directors?			7

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS			7

SECURITY OWNERSHIP OF MANAGEMENT			8

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE			9

PROPOSAL 1: ELECTION OF DIRECTORS			10

Class I Directors – Nominees for Terms Expiring in 2014			11
Class II Directors – Terms Expiring in 2012			13
Class III Directors – Terms Expiring in 2013			15

CORPORATE GOVERNANCE			16

Corporate Governance Web Site			16
Code of Business Ethics and Conduct and Hotline			16
Corporate Governance Guidelines			16
Board Independence			16
Stock Ownership Guidelines for Non-Employee Directors			17
Retirement Policy			17
Procedures for Shareholder Recommendations or Nominations of Director Candidates			17
Criteria for Board Membership			17
Board and Board Committee Membership and Meetings			18
Risk Oversight by the Board of Directors			22
Board Leadership Structure			22


NON-EMPLOYEE DIRECTOR COMPENSATION			23

Non-Employee Director Compensation Arrangements During Fiscal 2011 and 2012			23
Fiscal 2011 Non-Employee Director Compensation Table			24

EXECUTIVE COMPENSATION			26

Compensation Committee Report			26
Compensation Discussion and Analysis			27
Compensation Risk Analysis			44
Summary Compensation Table			45
Grants of Plan-Based Awards			48
Outstanding Equity Awards at Fiscal Year-End			49
Option Exercises and Stock Vested			52
Retirement Plan Compensation			53
Non-Qualified Deferred Compensation			54
Potential Payments Upon Termination or Following a Change-In-Control			56

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS			61

Related Person Transaction Policy and Procedures			61
Certain Relationship and Transaction with Former Director			61

PROPOSAL 2: NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATION			61

PROPOSAL 3: NON-BINDING ADVISORY VOTE ON THE FREQUENCY OF AN ADVISORY VOTE ON EXECUTIVE COMPENSATION			64

PROPOSAL 4: APPROVAL OF AMENDMENTS TO THE APOGEE ENTERPRISES, INC. 2009 STOCK INCENTIVE PLAN			64

Administration			65
Eligible Participants			65
Shares Available for Awards			65
Types of Awards and Terms and Conditions			66
Accounting for Awards			68
Duration, Termination and Amendment			68
Prohibition on Repricing Awards			68
Transferability of Awards			68
Federal Income Tax Consequences			69
Historical Awards Under the 2009 Stock Incentive Plan			71
New Plan Benefits			71
Equity Compensation Plan Information			72
Recommendation			73

PROPOSAL 5: APPROVAL OF AMENDMENTS TO THE APOGEE ENTERPRISES, INC. 2009 NON-EMPLOYEE DIRECTOR STOCK INCENTIVE PLAN			73

Administration			74
Eligible Participants			74
Shares Available for Awards			74
Types of Awards and Terms and Conditions			74
Accounting for Awards			76
Duration, Termination and Amendment			76
Prohibition on Repricing Awards			76
Transferability of Awards			77
Federal Income Tax Consequences			77
Historical Awards Under the 2009 Non-Employee Director Stock Incentive Plan			78
New Plan Benefits			79
Recommendation			79


AUDIT COMMITTEE REPORT AND PAYMENT OF FEES TO INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			79

Audit Committee Report			79
Audit Fees, Audit-Related Fees, Tax Fees and All Other Fees			80
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services Provided by Our Independent Registered Public Accounting Firm			80

PROPOSAL 6: RATIFICATION OF APPOINTMENT OF OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			80

SHAREHOLDER PROPOSALS FOR THE 2012 ANNUAL MEETING			81

ANNUAL REPORT TO SHAREHOLDERS			81

“HOUSEHOLDING” OF PROXY MATERIALS			81

OTHER MATTERS			82

Apogee Enterprises, Inc. 2009 Stock Incentive Plan, As Amended and Restated (2011)			Appendix A

Apogee Enterprises, Inc. 2009 Non-Employee Director Stock Incentive Plan, As Amended and Restated (2011)			Appendix B

iii

LOGO

PROXY STATEMENT

2011 ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD JUNE 22, 2011

The Board of Directors of Apogee Enterprises, Inc. (“Apogee” or the “Company”) is soliciting proxies for use at our annual meeting of shareholders to be held on Wednesday, June 22, 2011, and at any adjournment of the meeting. We are first making the proxy statement and form proxy card and voting instructions available to our shareholders on or about May 10, 2011.

QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND VOTING

What is the purpose of the meeting?

At our annual meeting, shareholders will act upon the matters outlined in the Notice of Annual Meeting of Shareholders. These include electing directors; conducting a non-binding advisory vote on Apogee’s executive compensation program (the “Say on Pay Proposal”); conducting a non-binding advisory vote on the frequency of a non-binding advisory vote on Apogee’s executive compensation program (the “Frequency of Say on Pay Proposal”); approving amendments to the Apogee Enterprises, Inc. 2009 Stock Incentive Plan (the “2009 Stock Incentive Plan Proposal”); approving amendments to the Apogee Enterprises, Inc. 2009 Non-Employee Director Stock Incentive Plan (the “2009 Non-Employee Director Stock Incentive Plan Proposal”); and ratifying the appointment of our independent registered public accounting firm. Also, management will report on our performance during fiscal 2011 and the first quarter of fiscal 2012 and respond to questions from shareholders.

Why did I receive a notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?

In accordance with rules adopted by the Securities and Exchange Commission (the “SEC”), we may now furnish proxy materials, including this proxy statement and our fiscal 2011 Annual Report to Shareholders, to our shareholders by providing access to such documents on the Internet instead of mailing printed copies. Most shareholders will not receive printed copies of the proxy materials unless they request them. Instead, the Notice of Internet Availability of Proxy Materials (the “Notice”), which was mailed to most of our shareholders, will instruct you as to how you may access and review all of the proxy materials on the Internet. The Notice also instructs you as to how you may submit your proxy on the Internet. By accessing and reviewing the proxy materials on the Internet, you will save us the cost of printing and mailing these materials to you and reduce the impact of such printing and mailing on the environment. If you would like to receive a paper copy of our proxy materials, you should follow the instructions for requesting such materials provided in the Notice.

How do I get electronic access to the proxy materials?

The Notice will provide you with instructions regarding how to view our proxy materials for the annual meeting on the Internet.

Who is entitled to vote at the meeting?

The Board of Directors has set May 3, 2011 as the record date for the annual meeting. If you were a shareholder of record at the close of business on May 3, 2011, you are entitled to notice of and to vote at the annual meeting.

As of the record date, 28,079,636 shares of common stock, par value $0.33-1/3, were issued and outstanding and, therefore, eligible to vote at the annual meeting.

What are my voting rights?

Holders of our common stock are entitled to one vote per share. Therefore, 28,079,636 votes are entitled to be cast at the meeting. There is no cumulative voting.

How many shares must be present to hold the meeting?

In accordance with our Amended and Restated Bylaws, shares equal to at least a majority of the voting power of the outstanding shares of our common stock as of the record date must be present at the meeting in order to hold the meeting and conduct business. This is called a quorum. Your shares are counted as present at the meeting if:

•

you are present and vote in person at the meeting; or

•

you have properly submitted a proxy via the Internet or by mail.

How do I vote my shares?

Your vote is important. Because many shareholders do not attend the meeting in person, it is necessary that a large number be represented by proxy. If you are a shareholder of record, you can give a proxy to be voted at the meeting in either of the following ways:

•

electronically via the Internet by following the “Vote by Internet” instructions on the Notice or, if you received paper copies of our proxy materials, the enclosed proxy card; or

•

by completing, signing and mailing the proxy card (if you received paper copies of our proxy materials).

The Internet voting procedure has been set up for your convenience. The procedure has been designed to authenticate your identity, allow you to give voting instructions, and confirm that those instructions have been recorded properly. If you are a shareholder of record and you would like to submit your proxy via the Internet, please refer to the specific instructions provided on the Notice or, if you received paper copies of our proxy materials, the enclosed proxy card. If you received paper copies of our proxy materials and wish to submit your proxy by mail, please return your signed proxy card in the enclosed postage-paid envelope to us before the annual meeting. If you are an employee and received our proxy statement and 2011 Annual Report to Shareholders electronically via the Internet at your company email address, you will only be able to give a proxy to be voted at the meeting electronically via the Internet as described under “How do I vote if my shares are held in the 401(k) retirement plan, employee stock purchase plan or other plans of Apogee?” on page 3.

If you hold your shares in street name, you must vote your shares in the manner prescribed by your broker or other nominee. Your broker or other nominee has enclosed or otherwise provided a voting instruction card for you to use in directing the broker or other nominee how to vote your shares.

If you properly submit your proxy via the Internet or return your executed proxy by mail and do not revoke your proxy, it will be voted in the manner you specify.

What is a proxy?

A proxy is your designation of another person to vote stock you own. That other person is called a proxy. If you designate someone as your proxy in a written document, that document also is called a proxy or a proxy card. When you designate someone a proxy, you may also direct the proxy how to vote your shares. We refer to this as your “proxy vote.” Three of our executive officers, Russell Huffer, James S. Porter and Patricia A. Beithon, have been designated as the proxies to cast the votes of our shareholders at our 2011 annual meeting.

What is a proxy statement?

A proxy statement is a document we are required to give you, or provide you access to, in accordance with the regulations of the SEC, when we ask you to designate proxies to vote your shares of our common stock at a meeting of our shareholders. The proxy statement includes information regarding the matters to be acted upon at the meeting and certain other information required by regulations of the SEC and rules of the NASDAQ Stock Market LLC (“NASDAQ”).

What is the difference between a shareholder of record and a “street name” holder?

If your shares are registered directly in your name, you are considered the shareholder of record with respect to those shares.

If your shares are held in a stock brokerage account or by a bank, trust or other nominee, then the broker, bank, trust or other nominee is considered to be the shareholder of record with respect to those shares. However, you still are considered the beneficial owner of those shares, and your shares are said to be held in “street name.” Street name holders generally cannot vote their shares directly and must instead instruct the broker, bank, trust or other nominee how to vote their shares using the voting instruction form provided by the broker, bank, trust or other nominee. Please refer to “How do I vote my shares?” on page 2.

How do I vote if my shares are held in the 401(k) retirement plan, employee stock purchase plan or other plans of Apogee?

If you hold any shares in our 401(k) retirement plan, employee stock purchase plan or other plans of Apogee, your Internet proxy vote or completed proxy card will serve as voting instructions to the plan trustee. However, your voting instructions must be received at least one day prior to the annual meeting in order to count. In accordance with the terms of our 401(k) retirement plan, the trustee will vote all of the shares held in the plan in the same proportion as the actual proxy votes submitted by plan participants at least one day prior to the annual meeting. If you are a participant in our employee stock purchase plan, the plan custodian cannot vote your shares unless it receives timely instructions from you.

If you hold shares in our 401(k) retirement plan, employee stock purchase plan or other plans of Apogee and have a company email address, you will receive our proxy statement and annual report to shareholders electronically at your company email address instead of receiving paper copies of these documents or the Notice in the mail. The email will provide instructions and a control number to use to provide voting instructions to the plan trustee via the Internet. If you receive our proxy statement and annual report electronically, you may only provide voting instructions to the plan trustee via the Internet and you will not receive a proxy card that can be returned by mail. If you are an employee who received our proxy statement and 2011 Annual Report to Shareholders electronically and you wish to receive a paper copy of these materials, you should contact:


Internet:		www.apog.com
Email:		IR@apog.com
Telephone:		(877) 752-3432
Facsimile:		(952) 487-7565
Mail:		Investor Relations
		Apogee Enterprises, Inc.
		4400 West 78^th Street, Suite 520
		Minneapolis, Minnesota 55435

What does it mean if I receive more than one Notice of Internet Availability of Proxy Materials or proxy card?

If you receive more than one Notice or proxy card, it means that you hold shares registered in more than one account in different names or variations of your name. To ensure that all of your shares are voted, if you submit your proxy vote via the Internet, vote once for each Notice or proxy card you receive, or sign and return each proxy card.

You may prefer to hold your shares in more than one account, and you are welcome to do so. However, some multiple accounts are unintentional and will occur if one stock purchase is made with a middle initial and a subsequent purchase is made without a middle initial. Please contact our Investor Relations Department at IR@apog.com, (877) 752-3432 (telephone) or (952) 487-7565 (facsimile) for information on how to merge your accounts.

Can I vote my shares in person at the meeting?

If you are a shareholder of record, you may vote your shares in person at the meeting by completing a ballot at the meeting. Even if you currently plan to attend the meeting, we recommend that you also submit your proxy as described above so that your vote will be counted if you later decide not to attend the meeting.

If you hold your shares in street name, you may vote your shares in person at the meeting only if you obtain a signed letter or other proxy from your broker, bank, trust or other nominee giving you the right to vote the shares at the meeting.

If you are a participant in our 401(k) retirement plan, employee stock purchase plan or other plans of Apogee, you may submit a proxy vote as described above, but you may not vote your plan shares in person at the meeting.

What vote is required for the election of directors or for a proposal to be approved?

With respect to the election of directors, in accordance with Minnesota law, the nominees for election as Class I directors will be elected by a plurality of the votes cast at the annual meeting. This means that since shareholders will be electing three Class I directors, the three nominees for Class I director receiving the highest number of votes will be elected. As provided in our Corporate Governance Guidelines, if a majority of our shares that are voted at the meeting are designated to be “withheld” from a director nominee’s election, then such nominee shall offer his or her resignation to our Nominating and Corporate Governance Committee for consideration. Our Nominating and Corporate Governance Committee will evaluate the best interests of Apogee and our shareholders and recommend to our Board of Directors the action to be taken with respect to that director’s offered resignation.

With respect to the Say on Pay Proposal, the 2009 Stock Incentive Plan Proposal, the 2009 Non-Employee Director Stock Incentive Plan Proposal and the ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm, the affirmative vote of a majority of the shares of our common stock present in person or by proxy and entitled to vote at the annual meeting is required for the approval of those proposals (provided that the total number of shares voted in favor of the proposal constitutes more than 25% of our outstanding shares).

With respect to the Frequency of Say on Pay Proposal, the frequency selected by shareholders will be determined based on a plurality of votes cast. This means that the option of one year, two years, or three years that receives the highest number of votes cast by shareholders will be the frequency that has been selected by shareholders.

How are votes counted?

You may either vote “FOR” or “WITHHOLD” authority to vote for each nominee for our Board of Directors. You may vote “FOR,” “AGAINST” or “ABSTAIN” on the Say on Pay Proposal, the 2009 Stock Incentive Plan Proposal, the 2009 Non-Employee Director Stock Incentive Plan Proposal and the ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm. Shareholders may vote “ONE YEAR,” “TWO YEARS,” “THREE YEARS,” or “ABSTAIN” on the Frequency of Say on Pay Proposal.

If you submit your proxy but ABSTAIN from voting or WITHHOLD authority to vote on one or more matters, your shares will be counted as present at the meeting for the purpose of determining a quorum. Your shares also will be counted as present at the meeting for the purpose of calculating the vote on the particular matter from which you abstained from voting or withheld authority to vote.

If you ABSTAIN from voting on the Frequency of Say on Pay Proposal, this will have no effect on the frequency that is selected by shareholders. If you ABSTAIN from voting on any other proposal, your abstention has the same effect as a vote against that proposal. We will not count WITHHOLD authority as either for or against a director nominee, so WITHHOLD authority has no effect on the election of a director; however, if a majority of our shares that are voted at the meeting are designated to be WITHHOLD authority from a director nominee’s election, then such director nominee shall offer his or her resignation to our Nominating and Corporate Governance Committee for consideration, as described under “What vote is required for the election of directors or for a proposal to be approved?” on page 4.

If you hold your shares in street name and do not provide voting instructions to your broker, your shares will be considered “broker non-votes” and will not be voted on any proposal on which your broker does not have discretionary authority to vote under the rules of the New York Stock Exchange. Shares that constitute broker non-votes will be counted as present at the meeting for the purpose of determining a quorum but will not be represented at the meeting for purposes of calculating the vote with respect to such matter or matters. This effectively reduces the number of shares needed to approve such matter or matters. Your broker or other nominee has discretionary authority to vote your shares on the ratification of Deloitte & Touche LLP as our independent registered public accounting firm, even if your broker or other nominee does not receive voting instructions from you. Your broker or other nominee does not have discretionary authority to vote your shares on the election of directors, Say on Pay Proposal, Frequency of Say on Pay Proposal, 2009 Stock Incentive Plan Proposal or 2009 Non-Employee Director Stock Incentive Plan Proposal if your broker or other nominee does not receive voting instructions from you.

Who will count the vote?

Representatives of Broadridge Financial Solutions, Inc., our tabulating agent, will tabulate the votes and act as independent inspector of election.

How does the Board of Directors recommend that I vote?

The Board of Directors recommends a vote:

•

FOR all of the director nominees;

•

FOR the Say on Pay Proposal;

•

FOR the ONE YEAR frequency on the Frequency of Say on Pay Proposal;

•

FOR the 2009 Stock Incentive Plan Proposal;

•

FOR the 2009 Non-Employee Director Stock Incentive Plan Proposal; and

•

FOR ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending March 3, 2012.

What if I do not specify how I want my shares voted?

If you submit your proxy via the Internet or a signed proxy card and do not specify how you want to vote your shares, we will vote your shares:

•

FOR all of the director nominees;

•

FOR the Say on Pay Proposal;

•

FOR the ONE YEAR frequency on the Frequency of Say on Pay Proposal;

•

FOR the 2009 Stock Incentive Plan Proposal;

•

FOR the 2009 Non-Employee Director Stock Incentive Plan Proposal;

•

FOR ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending March 3, 2012; and

•

in the discretion of the persons named in the proxy on any other matters that properly come before the meeting and as to which we did not have knowledge prior to February 23, 2011.

Can I change my vote after submitting my proxy or voting instructions?

Yes. If you are a shareholder of record, you may revoke your proxy and change your vote at any time before your proxy is voted at the annual meeting, in any of the following ways:

•

by sending a written notice of revocation to our Corporate Secretary;

•

by submitting a later-dated proxy to our Corporate Secretary;

•

by submitting a later-dated proxy via the Internet; or

•

by voting in person at the meeting.

If you hold your shares in street name, you should contact your broker, bank, trust or other nominee for information on how to revoke your voting instructions and provide new voting instructions.

If you hold shares in our 401(k) retirement plan, employee stock purchase plan or other plans of Apogee, you may revoke your proxy and change your voting instructions at any time, but not less than one day before the annual meeting, in any of the following ways:

•

by sending a written notice of revocation to the plan trustee or plan custodian;

•

by submitting a later-dated voting instruction or proxy to the plan trustee or plan custodian; or

•

by submitting a later-dated voting instruction or proxy via the Internet.

Will my vote be kept confidential?

Yes. We have procedures to ensure that, regardless of whether shareholders vote via the Internet, by mail or in person, (1) all proxies, ballots and voting tabulations that identify shareholders are kept permanently confidential, except as disclosure may be required by federal or state law or expressly permitted by a shareholder; and (2) voting tabulations are performed by an independent third party.

How can I attend the meeting?

You may be asked to present valid picture identification, such as a driver’s license or passport, before being admitted to the meeting. If you hold your shares in street name, you may also be asked to present proof of ownership to be admitted to the meeting. A recent statement from your broker, or letter from your bank, trust or other nominee are examples of proof of ownership.

Who pays for the cost of proxy preparation and solicitation?

We pay for the cost of proxy preparation and solicitation, including the reasonable charges and expenses of brokers and other nominees for forwarding proxy materials to the beneficial owners of our shares.

We are soliciting proxies primarily by mail and email. In addition, some of our officers and regular employees may solicit the return of proxies by telephone, facsimile, personal interview, email or telegram. These individuals will receive no additional compensation for these services.

How can I communicate with the Board of Directors?

Subject to reasonable constraints of time, topics and rules of order, you may direct comments to or ask questions of our Chairman or Chief Executive Officer during our 2011 Annual Meeting of Shareholders. In addition, you may communicate directly with any director by writing to:

Apogee Directors

Apogee Enterprises, Inc.

4400 West 78th Street, Suite 520

Minneapolis, Minnesota 55435

Attention: Corporate Secretary

Directors@apog.com

Our Corporate Secretary will promptly forward to the Board of Directors or the individually named directors all relevant written communications received at the above addresses. Our Board has requested certain communications that are unrelated to the duties and responsibilities of the Board be excluded, such as spam, junk mail, mass mailings, product inquiries, new product suggestions, resumes and other forms of employment inquiries, surveys and business solicitations or advertisements. All other written communications will be reviewed by our Corporate Secretary in conjunction with the Chair of our Nominating and Corporate Governance Committee for relevance to Board activities, and after such review, our Corporate Secretary will promptly forward all relevant written communications to the Board or the individually named directors.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

The following table sets forth information concerning beneficial ownership of our common stock outstanding as of May 3, 2011, the record date for our 2011 Annual Meeting of Shareholders, by persons known to us to own more than 5% of our common stock. Unless otherwise indicated, the named holders have sole voting and investment power with respect to the shares beneficially owned by them.


Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership (#)		% of Common Stock Outstanding
Franklin Resources, Inc.⁽¹⁾ One Franklin Parkway San Mateo, CA 94403		2,683,050		9.6	%
BlackRock, Inc.⁽²⁾ 40 East 52^nd Street New York, NY 10022		2,247,495		8.0	%
The Vanguard Group, Inc.⁽³⁾ 100 Vanguard Boulevard Malvern, PA 19355		1,431,272		5.1	%

⁽¹⁾

We have relied upon the information supplied by Franklin Resources, Inc. (“FRI”), Charles B. Johnson, Rupert H. Johnson, Jr. and Franklin Advisory Services, LLC, an investment adviser (“Franklin”), in a jointly filed Schedule 13G/A furnished to us reporting information as of December 31, 2010. Direct or indirect subsidiaries of Franklin serve as investment managers of one or more open-end or closed-end investment companies or other managed accounts that hold the shares of our common stock in the ordinary course of business. In their capacity as investment managers, the subsidiaries of Franklin exercise sole investment discretion over 2,683,050 shares, in the aggregate, held as of December 31, 2010. Of the shares reported, Franklin possessed sole voting power over 2,583,150 shares. Charles B. Johnson and Rupert H. Johnson, Jr., each of whom owns in excess of 10% of the outstanding common stock of FRI, may be deemed to be the beneficial owners of securities held by entities advised by FRI subsidiaries. Franklin, FRI subsidiaries, Charles B. Johnson and Rupert H. Johnson, Jr. disclaim beneficial ownership of the shares of our common stock. The filing persons and each of the investment management subsidiaries believe that they are not a “group” within the meaning of Rule 13d-5 of the Securities Exchange Act of 1934 (the “Exchange Act”).

⁽²⁾	We have relied upon the information supplied by BlackRock, Inc. in a Schedule 13G/A furnished to us reporting information as of December 31, 2010.

⁽³⁾

We have relied upon information supplied by The Vanguard Group, Inc. (“Vanguard”) in a Schedule 13G furnished to us reporting information as of December 31, 2010. Of the shares reported, Vanguard had sole investment discretion with respect to 1,386,244 shares and shared investment discretion and sole voting power with respect to 45,028 shares, and Vanguard Fiduciary Trust Company, a wholly owned subsidiary of Vanguard, serving as an investment manager of collective trust accounts, was the beneficial owner and directed the votes of 45,028 shares.

SECURITY OWNERSHIP OF MANAGEMENT

The following table sets forth the number of shares of our common stock beneficially owned as of May 3, 2011, the record date for our 2011 Annual Meeting of Shareholders, by each of our directors, each of our executive officers named in the Summary Compensation Table (our “Named Executive Officers”) and by all of our directors and executive officers as a group.

Amount and Nature of Beneficial Ownership


Name of Beneficial Owner	Shares of Common Stock Held (#)⁽¹⁾⁽²⁾			Shares Underlying Options Exercisable Within 60 Days (#)⁽³⁾		Total Beneficial Ownership (#)		% of Common Stock Outstanding		Phantom Stock/ Performance Share Units (#)			Total Stock-Based Ownership (#) ⁽⁴⁾
Non-Employee Directors
Bernard P. Aldrich		11,843			46,867		58,710		*		43,831	⁽⁵⁾		102,541
Jerome L. Davis		10,843			38,632		49,475		*		23,023	⁽⁵⁾		72,498
Sara L. Hays		10,843			31,025		41,868		*		19,705	⁽⁵⁾		61,573
John T. Manning		16,822	⁽⁶⁾		35,383		52,205		*		—			52,205
Robert J. Marzec		12,176			35,383		47,559		*		10,142	⁽⁵⁾		57,701
Stephen C. Mitchell		21,692			16,072		37,764		*		—			37,764
Richard V. Reynolds		10,843			25,383		36,226		*		19,145	⁽⁵⁾		55,371
David E. Weiss		18,714			35,383		54,097		*		—			54,097
Named Executive Officers
Patricia A. Beithon		145,363			54,928		200,291		*		44,530	⁽⁷⁾		244,821
Russell Huffer		261,185	⁽⁸⁾		150,133		411,318		1.5		105,819	⁽⁷⁾		517,137
Gary R. Johnson		41,403			11,000		52,403		*		14,192	⁽⁷⁾		66,595
James S. Porter		90,746	⁽⁹⁾		17,100		107,846		*		55,453	⁽⁷⁾		163,299
Gregory A. Silvestri⁽¹⁰⁾		5,204			—		5,204		*		—			5,204
All directors and executive officers as a group (12 persons)⁽¹¹⁾		652,473			497,289		1,149,762		4.0		335,840			1,485,602

*	Indicates less than 1%.

⁽¹⁾

Unless otherwise indicated, the individuals listed in the table have sole voting and investment power with respect to the shares owned by them, and such shares are not subject to any pledge. For our non-employee directors, the number indicated includes shares of restricted stock issued to the named individual pursuant to our 2009 Non-Employee Director Stock Incentive Plan. For our executive officers, the number of shares indicated includes shares issued to the named individual pursuant to our Amended and Restated 2002 Omnibus Stock Incentive Plan, our 2009 Stock Incentive Plan, our employee stock purchase plan and our 401(k) retirement plan.

⁽²⁾

Includes the following shares of restricted stock issued pursuant to our 2009 Non-Employee Director Stock Incentive Plan: 10,843 for each of Messrs. Aldrich, Davis, Manning, Marzec, Mitchell, Reynolds and Weiss, and Ms. Hays; and 86,744 shares for all executive officers and directors as a group. All shares of restricted stock held pursuant to the 2009 Non-Employee Director Stock Incentive Plan are subject to future vesting conditions and holders of such shares have no investment power over such shares.

Includes the following shares issued to our Named Executive Officers:


Named Executive Officers	Shares of Restricted Stock Issued Pursuant to Our Amended and Restated 2002 Omnibus Stock Incentive Plan		Shares of Restricted Stock Issued Pursuant to Our 2009 Stock Incentive Plan
Patricia A. Beithon		3,430		17,705
Russell Huffer		16,540		29,002
Gary R. Johnson		1,051		5,341
James S. Porter		4,145		21,313
Gregory A. Silvestri		—		—
All directors and executive officers as a group (12 persons)		25,166		73,361

All shares of restricted stock held pursuant to our Amended and Restated 2002 Omnibus Stock Incentive Plan, and all shares of restricted stock held pursuant to our 2009 Stock Incentive Plan are subject to future vesting conditions and the holders of such shares have no investment power over such shares.

⁽³⁾	Includes shares underlying stock options exercisable currently or within 60 days of May 3, 2011.

⁽⁴⁾	The amounts in this column are derived by adding the amounts in the “Total Beneficial Ownership (#)” and the “Phantom Stock/Performance Share Units (#)” columns of the table.

⁽⁵⁾	Includes phantom stock units, each representing the value of one share of our common stock, that are attributable to accounts in our Deferred Compensation Plan for Non-Employee Directors, which is described under the heading “Deferred Compensation Plan for Non-Employee Directors” on page 26.

⁽⁶⁾	Includes 1,000 shares held by Mr. Manning’s wife.

⁽⁷⁾

Includes performance share units awarded pursuant to our Amended and Restated 2002 Omnibus Stock Incentive Plan and 2009 Stock Incentive Plan which will only be earned if predetermined goals for a three-year performance period are met. Each performance share unit represents one share of our common stock.

⁽⁸⁾	Includes 32,560 shares held by Mr. Huffer’s wife, as to which he disclaims beneficial ownership.

⁽⁹⁾	Includes 350 shares held by Mr. Porter’s children.

⁽¹⁰⁾	Mr. Silvestri resigned from our Company effective as of March 11, 2011.

⁽¹¹⁾	Since Mr. Silvestri resigned from our Company effective as of March 11, 2011, he is not included in the total of all directors and officers as a group.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our directors and executive officers and persons who own more than 10% of our securities to file initial reports of ownership of those securities on Form 3 and reports of changes in ownership on Form 4 or Form 5 with the SEC. Specific due dates for these reports have been established by the SEC, and we are required to disclose in this proxy statement any failure to timely file the required reports by these dates. Based solely on our review of the copies of these reports received by us and written representations from our directors and executive officers, we believe that our directors and executive officers complied with all Section 16(a) filing requirements for the fiscal year ended February 26, 2011.

PROPOSAL 1: ELECTION OF DIRECTORS

Our Restated Articles of Incorporation provide that the Board of Directors will be divided into three classes of directors of as nearly equal size as possible. Our articles further provide that the total number of directors will be determined exclusively by our Board of Directors. The term of each class of director is three years, and the term of one class expires each year in rotation. At this year’s annual meeting, the terms of our Class I directors will expire. Currently, we have nine directors and three directors serving in Class I, four directors serving in Class II and two directors serving in Class III. Robert J. Marzec, Stephen C. Mitchell and David E. Weiss are the current Class I directors who have been nominated for re-election to the Board. The Class I directors elected at the annual meeting will serve until the 2014 Annual Meeting of Shareholders or until their successors are elected and qualified. Each of the nominees has agreed to serve as a director if elected.

We have no reason to expect that any of the nominees will fail to be a candidate at the annual meeting and, therefore, do not have in mind any substitute or substitutes for any of the nominees. If any of the nominees should be unable to serve as a director, proxies will be voted for a substitute nominee or nominees in accordance with the best judgment of the person or persons acting under the proxies.

The Board of Directors recommends that you vote FOR the three Class I nominees for director. Unless authority for one or more of the nominees is withheld, proxies will be voted FOR the election of each of Messrs. Marzec, Mitchell and Weiss as Class I directors for a three-year term expiring at the 2014 Annual Meeting of Shareholders.

The nominees for election as directors and the directors whose terms of office will continue after the annual meeting have provided information about themselves in the following section. SEC rules require us to discuss briefly the specific experience, qualifications, attributes or skills that led the Board to conclude that each director or nominee for director should serve on our Board of Directors. This discussion is provided in a separate paragraph titled “Key Attributes, Experience and Skills” below the “Biography” paragraph in the following section. All of our directors possess the minimum qualities and skills described under “Criteria for Board Membership” on page 17.

Class I Directors – Nominees for Terms Expiring in 2014



		ROBERT J. MARZEC, age 66 Biography – Retired Audit Partner of PricewaterhouseCoopers LLP, an international public accounting firm. Our director since 2005. Chair of our Audit Committee and member of our Nominating and Corporate Governance Committee. Mr. Marzec retired from PricewaterhouseCoopers LLP in 2002 after spending 36 years in its Assurance and Business Advisory Services (financial and regulatory reporting division). He held various leadership and audit positions, including Managing Partner of the Minneapolis office of PricewaterhouseCoopers LLP from 1991 to 1998. Key Attributes, Experience and Skills – Mr. Marzec has extensive public accounting and auditing experience at public, private and non-profit organizations and has a strong background in financial controls and reporting, financial management, financial analysis, SEC reporting requirements, mergers and acquisitions, and international business. During his service at PricewaterhouseCoopers LLP and on boards at other public and mutual companies, Mr. Marzec gained broad knowledge of many different companies and industries, and public company board and corporate governance practices. Other Directorships Since 2006 – Director of Medtox Scientific, Inc. Formerly a director of Health Fitness Corporation.

		STEPHEN C. MITCHELL, age 67 Biography – President and Chief Operating Officer of The Knight Group, LLC, a firm providing services for the start-up and management of new ventures, and Vice Chairman of Knight Facilities Management, Inc., a company providing facilities management services for industrial and commercial buildings worldwide. Our director since 1996. Chair of our Nominating and Corporate Governance Committee and member of our Compensation Committee. Our Lead Director from May 2006 to January 2011. Mr. Mitchell has more than 35 years of leadership experience in the facilities management and commercial construction industries, serving as Vice Chair of Knight Facilities Management, Inc. since 1995 and as President and Chief Operating Officer of Lester B. Knight & Associates, a company that provided engineering, architectural and management consulting services in connection with the planning, design and construction of advanced technology research and development and manufacturing facilities and other commercial buildings, from 1975 to 2001. Mr. Mitchell has provided consulting services to new business ventures as President and Chief Operating Officer of The Knight Group, LLC since 2001. Key Attributes, Experience and Skills – Mr. Mitchell’s more than 35 years of service in senior leadership positions at privately held companies in the facilities management and commercial construction industries provides valuable business, management and leadership experience, including expertise in strategy development, construction project management, building technology, international business, leadership development and succession planning. His role on another public company board provides him with public board and corporate governance experience. Other Directorships Since 2006 – Director of Landauer, Inc.

Class I Directors – Nominees for Terms Expiring in 2014

LOGO

DAVID E. WEISS, age 67

Biography – Retired Chairman, President and Chief Executive Officer of Storage Technology Corporation, a publicly-held developer, manufacturer and distributor of data storage solutions for the management, retrieval and protection of business information. Our director since 2005. Chair of our Compensation Committee and member of our Audit Committee.

Mr. Weiss has 33 years of leadership experience in the computer and information technology industry, serving as Chairman, President and Chief Executive Officer of Storage Technology Corporation from 1996 to 2000 and in other executive positions with Storage Technology Corporation from 1991 to 1996, including Chief Operating Officer, Executive Vice President, Senior Vice President for Marketing and Vice President – Global Marketing. Prior to joining Storage Technology Corporation, Mr. Weiss worked in various engineering management positions with IBM Corporation, a global computer and information technology company, from 1967 to 1991.

Key Attributes, Experience and Skills – As Chairman, President and Chief Executive Officer of Storage Technology Corporation, Mr. Weiss led a global public company and public company board. Through his service at Storage Technology Corporation and IBM Corporation, he gained expertise in the areas of business operations, strategy development, information technology, mergers and acquisitions, financial management, leadership development and succession planning, executive compensation, marketing, investor relations and corporate governance.

Other Directorships Since 2006 – Formerly a director of Incentra Solutions, Inc.

Class II Directors – Terms Expiring in 2012



		BERNARD P. ALDRICH, age 61 Biography – Retired Chief Executive Officer and President of Rimage Corporation, a publicly-held designer and manufacturer of on-demand publishing and duplicating systems for CD and DVD – recordable media. Our director since 1999. Our Non-Executive Chairman of the Board of Directors since January 2011. Mr. Aldrich retired as Chief Executive Officer and President and a director of Rimage Corporation in 2009 after 12 years of service in those capacities. Prior to joining Rimage Corporation in 1997, he served as President of several manufacturing companies controlled by Activar, Inc., an industrial plastics and construction supply company, from 1995 to 1996. Mr. Aldrich served as President of Colwell Industries, a company that designs, manufactures and distributes color merchandising tools, from 1992 to 1994 and as Chief Financial Officer of Advance Machine Co., a manufacturer and supplier of equipment for the commercial floor care industry, from 1973 to 1991. Key Attributes, Experience and Skills – Mr. Aldrich has 13 years of public company operational experience, eight years of private company operational experience and 18 years of private company financial management experience. In addition to leading companies, he has a background and expertise in manufacturing operations, financial management, global markets, executive compensation, leadership development and corporate governance. Mr. Aldrich also has recent experience leading a public company board. Other Directorships Since 2006 – Formerly a director of Rimage Corporation.

		SARA L. HAYS, age 46 Biography – Principal of SLH Advisors, a privately-held strategy, operations, governance and organizational design and development consulting firm, since May 2011. Our director since 2005. Member of our Audit Committee and Finance and Enterprise Risk Committee. Ms. Hays served as Managing Director, Operations and General Counsel and member of the Executive Committee of Wrightwood Capital LLC, a real estate finance and investment company from 2005 through April 2011. She served as Senior Vice President and General Counsel from 2001 to 2005 and as Vice President and General Counsel from 2000 to 2001 of Hyatt Hotels Corporation, a worldwide hotel and timeshare company. She served as General Counsel from 1997 to 2000 and as Development Counsel from 1994 to 1997 for Hyatt Development Corporation, a worldwide hotel and timeshare property development company. Ms. Hays was in private practice with the law firm of Coffield Ungaretti & Harris from 1989 to 1994. Key Attributes, Experience and Skills – Ms. Hays is an attorney and has served as general counsel to corporations for 14 years managing legal, regulatory and other business risks. She is very familiar with a broad range of legal, regulatory, compliance and other corporate governance issues. Ms. Hays has 22 years of experience in the commercial building development and financing industry and commercial construction industry. In addition, she has mergers and acquisitions experience. Ms. Hays also has private company and non-profit board experience.

Class II Directors – Terms Expiring in 2012



		RUSSELL HUFFER, age 61 Biography – Chief Executive Officer and President of Apogee. Our director since 1998. Since joining Apogee in 1986, Mr. Huffer has held various leadership positions. He became our Chief Executive Officer and President in 1998 and served as our Chairman from 1999 to January 2011. He served as President of our Glass Technologies segment from 1996 to 1998 and as Vice President and General Manager of Viracon, Inc., our largest subsidiary, from 1986 to 1996. Prior to joining Apogee, he held various management and operational positions at Guardian Industries Corp., a global manufacturer of float glass, fabricated glass, fiberglass insulation and other building materials, from 1980 to 1986 and Ford Motor Company, a global manufacturer of automotive vehicles, from 1978 to 1980. Key Attributes, Experience and Skills – As our Chief Executive Officer and President for more than 13 years and with 30 years experience in the glass industry, Mr. Huffer brings a deep knowledge of Apogee, our business units and operations, and the glass industry to our Board. He also presents management’s views and perspectives. In addition, his role on the board of Hutchinson Technology Incorporated has provided him with other public company board experience. Other Directorships Since 2006 – Director of Hutchinson Technology Incorporated.

		JOHN T. MANNING, age 62 Biography – Retired Vice Chairman and Audit Partner of BDO Seidman LLP, the U.S. member firm of the BDO International network, an international public accounting firm. Our director since 2005. Member of our Audit Committee and Compensation Committee. Mr. Manning retired from BDO Seidman LLP in 2000 after 27 years of service. During his tenure with BDO Seidman LLP (and its affiliate, BDO International), he worked in various management positions for 12 years, including Vice Chairman from 1995 to 1999, Managing Partner of the Richmond, Virginia office from 1990 to 1991, and various management positions in the international headquarters in Brussels, Belgium from 1992 to 1995. Prior to moving into management with BDO Seidman LLP, Mr. Manning spent 15 years providing auditing services to BDO Seidman’s clients. Key Attributes, Experience and Skills – Mr. Manning has extensive public accounting, auditing and management experience. During his tenure at BDO Seidman LLP, he gained broad knowledge of many different industries, including a specialty in the commercial construction industry, and experience working with public, private and not-for-profit boards. Mr. Manning has background and expertise in financial management, strategic planning, information technology, leadership development, risk assessment and mitigation, human resources, and international operations. Mr. Manning also has experience serving on public and private company boards.

Class III Directors –Terms Expiring in 2013



		JEROME L. DAVIS, age 56 Biography – Vice President of Food & Retail for Waste Management, Inc., a provider of comprehensive waste management services in North America. Our director since 2004. Chair of our Finance and Enterprise Risk Committee and member of our Nominating and Corporate Governance Committee. Prior to joining Waste Management, Inc. in 2010, Mr. Davis was President of Jerome L. Davis & Associates, LLC, an executive coaching and leadership development firm, from 2006 through 2009. He served as Executive Vice President and Managing Director of the Executive Leadership and High Performance Practice of TBM Consulting Group, a Lean and Six Sigma consulting firm, from 2007 to 2008. He worked for Electronic Data Systems, a business technology services company, as Global Vice President, Service Excellence from 2003 to 2005 and in various other capacities from 2001 to 2003, including Chief Client Executive Officer and President, Americas for Business Process Management. Prior to joining Electronic Data Systems, Mr. Davis worked for Maytag Corporation, a home and commercial appliance company, as President and Executive Officer of Maytag’s Commercial Solutions Division from 1999 to 2001 and as Senior Vice President of Sales and Corporate Officer of Maytag’s Appliances Division from 1998 to 1999. Mr. Davis also worked for Frito Lay, a global food company, from 1992 to 1998, serving as Vice President of National Accounts and Area Vice President. Prior to joining Frito Lay, Mr. Davis held various sales and marketing positions with Proctor & Gamble, a global consumer products company. Key Attributes, Experience and Skills – Mr. Davis brings extensive expertise and insight to our Board in the areas of marketing and sales, strategy development, international business, leadership development, succession planning, executive compensation and information technology. His role on the board of GameStop Corp. has provided him with public company board and corporate governance experience. Other Directorships Since 2006 – Director of GameStop Corp.

		RICHARD V. REYNOLDS, age 62 Biography – Lieutenant General, U.S. Air Force, retired. Owner of The Van Fleet Group, LLC, a privately-held aerospace consulting firm. Our director since 2006. Member of our Audit Committee and Finance and Enterprise Risk Committee. General Reynolds retired from the U.S. Air Force in 2005 after 34 years of service, having served as Vice Commander, Air Force Material Command from 2003 to 2005; Commander, Aeronautical Systems Center of U.S. Air Force Material Command from 2001 to 2003; Commander, Air Force Flight Test Center of U.S. Air Force Material Command from 1998 to 2001; Program Executive Officer, Airlift and Trainers of the U.S. Air Force Program Executive Office from 1996 to 1998 and various other leadership positions from 1971 to 1996. General Reynolds formed The Van Fleet Group, LLC in 2006. He also served as Senior Manager/Senior Business Advisor of Bearing Point, Inc., an international management and technology consulting firm, from 2006 to 2009. Key Attributes, Experience and Skills – General Reynolds’ service in senior leadership positions in the U.S. Air Force provides valuable business, leadership and management experience, including expertise in government contracting and procurement, risk assessment and mitigation, supply chain and logistics management, information technology and leadership development. General Reynolds also has private company and non-profit board experience.

CORPORATE GOVERNANCE

Corporate Governance Web Site

Information relative to our corporate governance is available on our web site at www.apog.com by clicking on “Governance.” This information includes:

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Board of Directors – Background, Experience and Independence

•

Board Committees – Current Members and Committee Charters

•

How to Contact the Board

•

Management – Background and Experience

•

Our Code of Business Ethics and Conduct

•

Our Corporate Governance Guidelines

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Our Amended and Restated Bylaws

•

Our Restated Articles of Incorporation

We will provide copies of any of the foregoing information without charge upon written request to: Corporate Secretary, Apogee Enterprises, Inc., 4400 West 78^th Street, Suite 520, Minneapolis, Minnesota 55435.

Code of Business Ethics and Conduct and Hotline

Our Board has adopted our Code of Business Ethics and Conduct (our “Code of Conduct”), which is a statement of our high standards for ethical behavior and legal compliance. Our Code of Conduct governs the manner in which we conduct business. All of our employees, including our executive officers, and all members of our Board of Directors are required to comply with our Code of Conduct. A copy of our Code of Conduct is available on our web site at www.apog.com by clicking on “Governance,” then “Code of Conduct,” then “Code of Conduct – English.”

Corporate Governance Guidelines

Our Corporate Governance Guidelines outline the role, composition, qualifications, operation and other policies applicable to our Board. Our Corporate Governance Guidelines are reviewed annually and revised as necessary to continue to reflect best corporate governance practices. The full text of our Corporate Governance Guidelines, as last amended by our Board in April 2011, may be found on our web site at www.apog.com by clicking on “Governance,” then “Corporate Governance Guidelines.”

Board Independence

Under our Corporate Governance Guidelines, a substantial majority of the directors on our Board, and all members of our Board committees must be independent. Each year, in accordance with NASDAQ rules, our Board affirmatively determines the independence of each director and nominee for election as a director in accordance with guidelines it has adopted, which include all elements of independence set forth in the NASDAQ listing standards.

With the assistance of legal counsel to the Company, our Nominating and Corporate Governance Committee reviewed the applicable legal standards for Board member and Board committee member independence. In making its independence recommendation, our Nominating and Corporate Governance Committee reviewed a summary of the answers to annual questionnaires completed by each Board member regarding employment, business, familial, compensation and other relationships with Apogee and our management. On the basis of this review, our Nominating and Corporate Governance Committee reported on its review to our Board of Directors. After reviewing the information presented to it, the Board made its independence determination based upon our Nominating and Corporate Governance Committee’s review and recommendation and the related supporting information.

Based on this review, our Board of Directors has determined that the following non-employee directors are independent and have no material relationship with us except serving as a director or shareholder: Bernard P. Aldrich, Jerome L. Davis, Sara L. Hays, John T. Manning, Robert J. Marzec, Stephen C. Mitchell, Richard V. Reynolds and David E. Weiss. Our Board of Directors has determined that Russell Huffer and James L. Martineau, who retired from our Board effective as of our 2010 Annual Meeting of Shareholders, are not independent because Mr. Huffer serves as our Chief Executive Officer and President and Mr. Martineau served as a consultant to our Company until fiscal 2002 and his daughter-in-law is employed by one of our subsidiaries in a field sales capacity, as described under the heading “Certain Relationship and Transaction with Former Director” on page 61.

Stock Ownership Guidelines for Non-Employee Directors

Our Board of Directors believes that non-employee directors should have a significant equity interest in Apogee and established voluntary stock ownership guidelines for directors in 2002. The guidelines encourage share ownership by our directors in an amount having a market value of $120,000 (three times the current annual Board retainer of $40,000) to be achieved within five years of first being elected as a director. In calculating share ownership of our non-employee directors, we include shares of restricted stock issued pursuant to our 2009 Non-Employee Director Stock Incentive Plan and phantom stock units under our Deferred Compensation Plan for Non-Employee Directors, but do not include unexercised stock options. As of February 25, 2011, the last trading day of fiscal 2011, all our non-employee directors met our stock ownership guidelines.

Retirement Policy

Our Board of Directors has established a policy that, unless otherwise approved by a majority of our directors, no individual who is over 72 years of age may be elected to serve as a director.

Procedures for Shareholder Recommendations or Nominations of Director Candidates

A shareholder who wishes to recommend a director candidate to our Board for nomination by our Board at our annual meeting or for vacancies on our Board that arise between meetings must provide our Nominating and Corporate Governance Committee with sufficient written documentation to permit a determination by our Board as to whether such candidate meets the required and desired director selection criteria set forth in our Corporate Governance Guidelines and the factors discussed below under the heading “Criteria for Board Membership.” Such documentation and the name of the director candidate must be sent by U.S. mail to our Corporate Secretary at the address indicated on the Notice of Annual Meeting of Shareholders. Our Corporate Secretary will send properly submitted shareholder recommendations to the Chair of our Nominating and Corporate Governance Committee for consideration at a future committee meeting.

Alternatively, shareholders may directly nominate a person for election to our Board of Directors by complying with the procedures set forth in our Amended and Restated Bylaws and the rules and regulations of the SEC. Shareholders may request a copy of our Amended and Restated Bylaws by contacting our Corporate Secretary at the address indicated on the Notice of Annual Meeting of Shareholders. Any shareholder nominations of director candidates for the 2012 election of directors should be submitted to our Corporate Secretary at the address indicated on the Notice of Annual Meeting of Shareholders no later than February 23, 2012.

Criteria for Board Membership

Our Corporate Governance Guidelines outline our director qualification standards. Director candidates should possess the highest personal and professional ethics, integrity and values; be committed to representing the long-term interests of our stakeholders; have an inquisitive and objective perspective, practical wisdom and mature judgment; and be willing to challenge management in a constructive manner. Our Board strives for Board membership that is diverse in gender, ethnicity, age, geographic location, and business skills and experience at policy-making levels. In addition, director candidates must be willing to devote sufficient time to carrying out their duties and responsibilities effectively, and should be committed to serving on our Board for an extended period of time.

Our Nominating and Corporate Governance Committee considers recommendations of director candidates. Director candidates recommended by shareholders in compliance with the procedures described under the heading “Procedures for Shareholder Recommendations or Nominations of Director Candidates” on page 17 and who meet the criteria outlined above will be evaluated by our Nominating and Corporate Governance Committee in the same manner as nominees proposed by other sources.

Our Nominating and Corporate Governance Committee’s procedure for reviewing the qualifications of all nominees for Board membership include making a preliminary assessment of each proposed nominee, based upon resume and biographical information, willingness to serve, and other background information, business experience and leadership skills. All director candidates who continue in the process are then interviewed by members of our Nominating and Corporate Governance Committee and a majority of our other current directors. Our Nominating and Corporate Governance Committee makes recommendations to our Board for inclusion in the slate of director nominees at an annual or special meeting of shareholders, or for appointment by our Board to fill a vacancy. Prior to recommending a director to stand for re-election for another term, our Nominating and Corporate Governance Committee applies its director candidate selection criteria, including a director’s past contributions to our Board, effectiveness as a director and desire to continue to serve as a director. Our Board, Board committee and individual director evaluation processes are important determinants used by our Nominating and Corporate Governance Committee in recommending that a director stand for re-election.

Board and Board Committee Membership and Meetings

During fiscal 2011, our Board of Directors met seven times and our non-employee directors met in executive session without our Chief Executive Officer or any other members of management being present six times, and our non-employee directors who meet the independence requirements of the NASDAQ listing standards met in executive session five times. Each of our directors attended at least 75% of the regularly scheduled and special meetings of the Board and the Board Committees on which he or she served that were held during the time he or she was a director during fiscal 2011. All Board members are expected to attend our annual meetings of shareholders and all of our Board members attended our 2010 Annual Meeting of Shareholders, with the exception of James L. Martineau, who retired from our Board at such meeting.

We had four standing Board committees during fiscal 2011: Audit, Compensation, Nominating and Corporate Governance, and Finance and Enterprise Risk.

The table below provides fiscal 2011 membership and meeting information for each of our Board Committees.


Name	Audit Committee	Compensation Committee	Nominating and Corporate Governance Committee	Finance and Enterprise Risk Committee
Bernard P. Aldrich		C⁽¹⁾	M⁽¹⁾
Jerome L. Davis			M	C
Sara L. Hays	M			M
Russell Huffer
John T. Manning	M	M
James L. Martineau				M⁽²⁾
Robert J. Marzec	C		M
Stephen C. Mitchell⁽³⁾		M	C
Richard V. Reynolds	M			M
David E. Weiss	M	C⁽⁴⁾
Fiscal 2011 Meetings	9	8	5	5
Fiscal 2011 Executive Sessions	4	3	2	4

C = Committee Chair M = Committee Member

⁽¹⁾	Until his appointment as Non-Executive Chair of the Board in January 2011.

⁽²⁾	Until his retirement effective as of our 2010 Annual Meeting of Shareholders.

⁽³⁾	Lead Independent Director until January 2011.

⁽⁴⁾	Member of the Compensation Committee during fiscal 2011 and Chair of the Compensation Committee since January 2011.

Audit Committee

Our Audit Committee is comprised entirely of independent directors and is governed by a Board-approved charter, which was last amended in April 2010. Under its charter, our Audit Committee:

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oversees our financial reporting process (including our system of financial controls, internal audit procedures and independent registered public accounting firm).

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oversees our program to ensure compliance with legal and regulatory requirements and ethical business practices.

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assesses and establishes policies and procedures to manage our financial reporting and internal control risk.

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is directly responsible for the appointment, compensation, retention and oversight of the work of our independent registered public accounting firm.

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evaluates the qualifications, performance and independence of our independent registered public accounting firm.

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establishes policies and procedures for the pre-approval of all services provided by our independent registered public accounting firm.

•

oversees our internal audit function and has established procedures for the receipt, retention and treatment of complaints regarding accounting, internal controls and auditing matters.

Our Board of Directors has determined that each member of our Audit Committee meets the independence and experience requirements of the NASDAQ listing standards and the SEC. Our Board of Directors has also determined that each of John T. Manning and Robert J. Marzec is an audit committee financial expert under the rules of the SEC.

A copy of the Audit Committee charter may be found on our web site at www.apog.com by clicking on “Governance,” then “Board Committee Composition and Charters” and then “Audit Committee.”

Compensation Committee

Our Compensation Committee is comprised entirely of independent directors and is governed by a Board-approved charter, which was last amended in April 2011. Under its charter, our Compensation Committee:

•

establishes our executive compensation philosophy and compensation programs that comply with this philosophy.

•

determines the compensation of our executive officers and other members of senior management.

•

administers our stock incentive plans in which our employees participate.

•

administers our annual cash and long-term incentive plans for executive officers and other members of senior management.

•

administers our deferred compensation plans for our executive officers and other members of senior management.

•

administers our 2009 Stock Incentive Plan, Amended and Restated 2002 Omnibus Stock Incentive Plan, Amended and Restated 1997 Omnibus Stock Incentive Plan, Amended and Restated Executive Management Incentive Plan, 2011 Deferred Compensation Plan, Amended and Restated 1987 Partnership Plan (“Legacy Partnership Plan”), Officers’ Supplemental Executive Retirement Plan (“Legacy SERP”), and Deferred Incentive Compensation Plan (“Legacy Deferred Compensation Plan”).

Our Compensation Committee regularly reviews its decisions on compensation for our Chief Executive Officer with the full Board prior to communicating those decisions to our Chief Executive Officer.

Our Board of Directors has determined that each member of our Compensation Committee is independent, as defined by the NASDAQ listing standards. In addition, each Compensation Committee member is a “non-employee” director, as defined in the Exchange Act, and is an “outside director” as defined in Section 162(m) of the Internal Revenue Code.

A copy of the Compensation Committee charter may be found on our web site at www.apog.com by clicking on “Governance,” then “Board Committee Composition and Charters” and then “Compensation Committee.”

Nominating and Corporate Governance Committee

Our Nominating and Corporate Governance Committee is comprised entirely of independent directors and is governed by a Board-approved charter, which was last amended in January 2011. Under its charter, our Nominating and Corporate Governance Committee:

•

periodically assesses our compliance with our Corporate Governance Guidelines.

•

reviews our organizational structure and succession plans.

•

makes recommendations to our Board regarding the composition and responsibilities of our Board committees.

•

determines the compensation for directors.

•

administers our 2009 Non-Employee Director Stock Incentive Plan and Deferred Compensation Plan for Non-Employee Directors.

•

annually conducts a performance review of our Board committees and Board as a whole and of our directors whose terms are expiring at that year’s annual meeting of shareholders and who have expressed an interest in standing for re-election.

•

annually conducts a review of the performance of our Chief Executive Officer, which includes soliciting assessments from all non-employee directors, and reviews the results of such performance review with members of our Compensation Committee and our entire Board.

•

determines the required selection criteria and qualifications of director nominees based upon our needs at the time nominees are considered and recommends new director nominees to our Board.

•

establishes and implements procedures to identify and review the qualifications of all nominees for Board membership, including nominees recommended by our shareholders, and considers qualified director nominees recommended by shareholders.

Our Board of Directors has determined that each member of our Nominating and Corporate Governance Committee is independent, as defined by the NASDAQ listing standards.

A copy of the Nominating and Corporate Governance Committee charter may be found on our web site at www.apog.com by clicking on “Governance,” then “Board Committee Composition and Charters” and then “Nominating and Corporate Governance Committee.”

Finance and Enterprise Risk Committee

Our Finance and Enterprise Risk Committee is comprised entirely of independent directors and is governed by a Board-approved charter, which was last amended in April 2010. Under its charter, our Finance and Enterprise Risk Committee:

•

oversees our financial strategy, long-range financial objectives, financial condition, company-wide information technology strategy and enterprise risk management processes.

•

makes recommendations to our Board of Directors with respect to our financial policies and standards, new or amended credit facilities and other forms of indebtedness for borrowed money, appropriate debt limits, financing arrangements, share repurchase programs, stock splits, quarterly dividend declarations and issuances of equity and debt securities for the purpose of raising capital.

•

oversees our compliance with financial covenants contained in our credit facility and other long-term debt.

•

reviews our annual capital budget.

•

oversees our process for evaluating and approving capital expenditure projects.

•

provides oversight for our overall enterprise risk management function, including our operational, financial, business, information technology, overall enterprise risk and risk related insurance programs.

•

oversees the selection, implementation and financing of material company-wide information technology systems.

Our Board of Directors has determined that each member of our Finance and Enterprise Risk Committee is independent, as defined by the NASDAQ listing standards.

A copy of the Finance and Enterprise Risk Committee charter may be found on our web site at www.apog.com by clicking on “Governance,” then “Board Committee Composition and Charters” and then “Finance and Enterprise Risk Committee.”

Risk Oversight by the Board of Directors

Our Board executes its overall responsibility for risk management directly and through its Committees, as follows:

•

Our Audit Committee has primary responsibility for risks relating to the reliability of our financial reporting processes, system of internal controls and compliance program. Our Audit Committee receives quarterly reports from management, our independent registered public accounting firm and internal audit partner regarding our financial reporting processes, internal controls and public filings. Our Audit Committee also receives quarterly updates from our General Counsel regarding Code of Conduct issues and reports on litigation, legal claims and other legal compliance concerns.

•

Our Compensation Committee, with assistance from its independent compensation consultant, oversees risks associated with its areas of responsibility, including the risks associated with our compensation programs, policies and practices with respect to both executive compensation and compensation generally.

•

Our Nominating and Corporate Governance Committee oversees risks associated with its areas of responsibility, including the risks associated with succession planning, non-employee director compensation and corporate governance practices.

•

Our Finance and Enterprise Risk Committee has primary responsibility for overseeing our enterprise risk management processes, focusing on our operational, financial, business, information technology and overall enterprise risk and risk-related insurance programs. Our Finance and Enterprise Risk Committee’s meeting agendas include discussions of risk areas and our risk mitigation and control practices throughout the year.

Our Board is kept abreast of the risk oversight efforts by our Committees through reports to our full Board by our Committee Chairs presented at each quarterly meeting of our Board. Our Board considers specific risk topics, including risks associated with our strategic plan, mergers and acquisitions, and market risks. In addition, as part of our annual strategic review of each of our business units, our Board discusses the risks and exposures of each business unit.

Board Leadership Structure

Our Corporate Governance Guidelines provide that our Board has discretion to combine or separate the offices of Chair of the Board and Chief Executive Officer. Our Board makes this determination considering what it believes is in the best interests of our Company and shareholders in light of the circumstances existing at that time, recognizing that circumstances can change. When the Chief Executive Officer also holds the position of Chair, a Lead Director will be appointed by our Board to further the achievement of a strong, independent Board with an appropriate balance between our Board and our Chief Executive Officer. In that situation, generally the Chair of our Nominating and Corporate Governance Committee will serve as our Lead Director.

Our Board separated the roles of Chair of the Board and Chief Executive Officer in January 2011, in connection with Mr. Huffer’s announcement of his planned retirement. The Board determined that the appointment of a Non-Executive Chair of the Board at that time would provide the Board with independent leadership during the Chief Executive Officer transition and permit the incoming Chief Executive Officer to concentrate on our business operations. As a result, the Board appointed Mr. Aldrich as the Non-Executive Chair of our Board in January 2011. In this capacity, Mr. Aldrich has chaired the meetings of our Board of Directors and executive sessions of our independent directors. Mr. Aldrich, as the retired Chief Executive Officer and President of a public company, has significant public company experience. The Non-Executive Chair of our Board, in consultation with our Chief Executive Officer, establishes the agenda for each Board meeting.

We believe our Board leadership structure supports the risk oversight function of our Board. In addition to having a Non-Executive Chair of the Board, strong independent directors chair our Board committees involved with risk oversight, there is open communication between management and our directors, and all of our directors are actively involved in the risk oversight function.

NON-EMPLOYEE DIRECTOR COMPENSATION

Non-Employee Director Compensation Arrangements During Fiscal 2011 and 2012

Our Nominating and Corporate Governance Committee is responsible for establishing compensation for our Board members. We target compensation for service on our Board and Board committees generally at the median for board services at companies in our peer group of companies, using the same peer group used for executive compensation purposes described under the heading “Consulting Assistance, Competitive Market and Compensation Positioning” on page 32. Generally, our Nominating and Corporate Governance Committee reviews and discusses the compensation data and analysis provided by the independent compensation consultant retained to advise it on matters related to compensation for our Board members. Our Chief Executive Officer participates in the discussions on compensation for our Board members. Our Nominating and Corporate Governance Committee generally makes its own recommendations to our Board regarding Board and Board committee compensation, and our Board approves Board and Board committee compensation, based on the recommendations of our Nominating and Corporate Governance Committee. Directors who are our employees receive no additional compensation for serving on our Board.

Our non-employee directors receive cash compensation in the form of cash retainers and equity compensation in the form of restricted stock awards, as described below. Mr. Huffer, our only employee director, receives no additional compensation for serving on our Board.

The following table describes the compensation arrangements with our non-employee directors for fiscal 2011 and 2012.


Compensation	Fiscal 2011	Fiscal 2012
Annual Cash Retainers:
Non-Executive Chair of the Board⁽¹⁾	N/A	$100,000
Board Member⁽¹⁾	$40,000	40,000
Lead Director⁽²⁾	12,000	N/A
Audit Committee Chair	30,000	30,000
Audit Committee Member	15,000	15,000
Compensation Committee Chair	20,000	20,000
Compensation Committee Member	10,000	10,000
Nominating and Corporate Governance Committee Chair	10,000	20,000
Nominating and Corporate Governance Committee Member	5,000	10,000
Finance and Enterprise Risk Committee Chair	20,000	20,000
Finance and Enterprise Risk Committee Member	10,000	10,000

Equity Grant	An annual three-year time-based restricted stock award.	An annual three-year time-based restricted stock award.

Charitable Matching Contributions Program for Non- Employee Directors	$2,000 maximum aggregate annual match.	$2,000 maximum aggregate annual match.

⁽¹⁾	We elected a Non-Executive Chair of the Board in January 2011. We pay an annual cash retainer to our Non-Executive Chair of the Board and do not pay any other cash compensation to him or her for service on our Board.

⁽²⁾	We eliminated the Lead Director position in January 2011 when we elected a Non-Executive Chair of the Board.

Fiscal 2011 Non-Employee Director Compensation Table

The following table shows the compensation paid to our non-employee directors for fiscal 2011.


Name	Fees Earned or Paid in Cash ($)⁽¹⁾		Stock Awards ($)⁽²⁾		All Other Compensation ($)⁽³⁾		Total ($)
Bernard P. Aldrich		65,000		70,004		17,861		152,865
Jerome L. Davis		65,000		70,004		10,821		145,825
Sara L. Hays		65,000		70,004		11,321		146,325
John T. Manning		65,000		70,004		6,643		141,647
James L. Martineau⁽⁴⁾		16,667		—		2,397		19,064
Robert J. Marzec		75,000		70,004		8,277		153,281
Stephen C. Mitchell		72,000		70,004		5,048		147,052
Richard V. Reynolds		65,000		70,004		9,722		144,726
David E. Weiss		65,000		70,004		5,048		140,052

⁽¹⁾

Includes cash retainers deferred by non-employee directors under our Deferred Compensation Plan for Non-Employee Directors, as further described under the heading “Deferred Compensation Plan for Non-Employee Directors” on page 26. The table below sets forth the amount of cash retainers deferred by our non-employee directors under our Deferred Compensation Plan for Non-Employee Directors with respect to fiscal 2011.


Name	Deferred Compensation Plan for Non-Employee Directors ($)
Bernard P. Aldrich		65,000
Jerome L. Davis		65,000
Sara L. Hays		—
John T. Manning		—
James L. Martineau		—
Robert J. Marzec		—
Stephen C. Mitchell		—
Richard V. Reynolds		48,750
David E. Weiss		—

⁽²⁾

The amounts in this column are calculated based on the fair market value of our common stock on the date the award was made in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”). Each non-employee director received a time-based restricted stock award of 5,973 shares on June 23, 2010. The closing price of our common stock on the NASDAQ Global Select Market on June 23, 2010, the date of grant, was $11.72. The table below sets forth, as of February 26, 2011, the end of fiscal 2011, certain information with respect to shares of restricted stock and options to purchase shares of our common stock held by our non-employee directors. All such stock options were fully exercisable as of such date.


	Shares of Restricted Stock		Stock Options
Name	Aggregate Number of Shares of Restricted Stock (#)	Total Number of Restricted Stock Awards (#)	Aggregate Number of Stock Options (#)	Total Number of Stock Option Awards (#)
Bernard P. Aldrich	10,843	2	46,867	6
Jerome L. Davis	10,843	2	38,632	5
Sara L. Hays	10,843	2	31,025	4
John T. Manning	10,843	2	35,383	5
James L. Martineau	—	—	59,441	8
Robert J. Marzec	10,843	2	35,383	5
Stephen C. Mitchell	10,843	2	16,072	2
Richard V. Reynolds	10,843	2	25,383	3
David E. Weiss	10,843	2	35,383	5

⁽³⁾

This column includes the dividend equivalents paid on phantom stock units pursuant to our Deferred Compensation Plan for Non-Employee Directors, dividends paid on shares of restricted stock issued pursuant to our 2009 Non-Employee Director Stock Incentive Plan and matching contributions pursuant to our Charitable Matching Contributions Program for Non-Employee Directors. The table below sets forth the amounts contributed or paid by the Company for our non-employee directors pursuant to such plans with respect to fiscal 2011.


Name	Dividend Equivalents Paid on Phantom Stock Units Held in our Deferred Compensation Plan for Non-Employee Directors ($)		Dividends Paid on Shares of Restricted Stock Issued Pursuant to our 2009 Non- Employee Director Stock Incentive Plan ($)		Matching Contribution under our Charitable Matching Contribution Program for Non- Employee Directors ($)		Total All Other Compensation ($)
Bernard P. Aldrich		12,813		3,048		2,000		17,861
Jerome L. Davis		5,773		3,048		2,000		10,821
Sara L. Hays		6,273		3,048		2,000		11,321
John T. Manning		1,595		3,048		2,000		6,643
James L. Martineau		—		397		2,000		2,397
Robert J. Marzec		3,229		3,048		2,000		8,277
Stephen C. Mitchell		—		3,048		2,000		5,048
Richard V. Reynolds		4,674		3,048		2,000		9,722
David E. Weiss		—		3,048		2,000		5,048

⁽⁴⁾	Mr. Martineau retired from our Board effective as of our 2010 Annual Meeting of Shareholders.

Restricted Stock Awards

Restricted stock awards to non-employee directors are issued pursuant to our 2009 Non-Employee Director Stock Incentive Plan. Each non-employee director receives a time-based restricted stock award on the date he or she is first elected to our Board and annually on the date of our annual meeting of shareholders if his or her term continues after such meeting. The number of shares of restricted stock subject to the award is determined by our Board of Directors, after recommendation by our Nominating and Corporate Governance Committee and consideration of various factors, including our performance, market data and trends, performance by our Board as a whole and the equity-based compensation received by non-employee directors approximating the 50^th percentile of our peer group of companies. The restricted stock awards made in 2009 and 2010 fully vest on the third anniversary of the date of the award. If the 2009 Non-Employee Director Stock Incentive Plan Proposal is approved by our shareholders, the plan would permit newly issued time-based restricted stock awards subject to the three-year minimum vesting period to vest in installments over the three-year period.

Deferred Compensation Plan for Non-Employee Directors

Our non-employee directors may elect to participate in our Deferred Compensation Plan for Non-Employee Directors. This plan was adopted by our Board of Directors in October 1998 and approved at our 1999 Annual Meeting of Shareholders to encourage our non-employee directors to continue to make contributions to the growth and profits of Apogee and to increase their ownership of shares of our common stock, thereby aligning their interests in the long-term success of Apogee with that of our other shareholders. Under the plan, participants may defer a portion of their annual retainer and meeting fees into deferred stock accounts. The plan was amended to eliminate the 10% Company match on amounts deferred by our non-employee directors under such plan after December 31, 2009. Each participating director receives a credit of shares of our common stock in an amount equal to the amount deferred divided by the fair market value of one share as of the crediting date. These accounts also are credited, as of the crediting date, with an amount equal to the dividend paid on one share of our common stock multiplied by the number of shares credited to each account. Participating directors may elect to receive the amounts credited to their accounts at a fixed date, at age 70 or following death or retirement from our Board of Directors. The amounts will be paid out in the form of shares of our common stock (plus cash in lieu of fractional shares) either in a lump sum or in installments, at the participating director’s election. This plan is an unfunded, book-entry, “phantom stock unit” plan, as no trust or other vehicle has been established to hold any shares of our common stock.

Charitable Matching Contributions Program for Non-Employee Directors

Under our Charitable Matching Contributions Program for Non-Employee Directors, we match cash or publicly-traded stock contributions made by our non-employee directors to cultural, educational, social, medical or health-related charitable organizations that are exempt from federal income tax and qualify as a charity to which individuals can make a tax-deductible contribution up to a maximum aggregate amount of $2,000 per eligible non-employee director per calendar year.

EXECUTIVE COMPENSATION

Compensation Committee Report

Our Compensation Committee has reviewed and discussed the following Compensation Discussion and Analysis section with management. Based on its review and discussions with management, our Compensation Committee recommended to our Board of Directors that the Compensation Discussion and Analysis be included in the Company’s 2011 proxy statement and in the Company’s Annual Report on Form 10-K for the fiscal year ended February 26, 2011.

Compensation Committee of the Board of Directors of Apogee


David E. Weiss, Chair		Stephen C. Mitchell
John T. Manning

Compensation Discussion and Analysis

Executive Summary

This Compensation Discussion and Analysis describes Apogee’s executive compensation program for fiscal 2011, and certain elements of the fiscal 2012 program. In particular, this section explains how our Compensation Committee (the “Committee”) made decisions related to compensation for our executives, including our Named Executive Officers, for fiscal 2011.

Our Named Executive Officers for fiscal 2011 were:


• Russell Huffer		Chief Executive Officer, President and Former Chairman

• James S. Porter		Chief Financial Officer

• Gregory A. Silvestri		Former Executive Vice President of Apogee and President of Viracon, Inc.

• Patricia A. Beithon		General Counsel and Corporate Secretary

• Gary R. Johnson		Vice President and Treasurer

Fiscal 2011 Market and Business Conditions. As we anticipated, fiscal 2011 was a very challenging year for Apogee due to the economic recession, high U.S. unemployment, high commercial office vacancy rates and uncertainty in U.S. and foreign financial markets. Our Architectural segment, which accounted for 87% of our overall revenues in fiscal 2011, primarily provides value-added glass products, services and systems for the U.S. commercial construction industry, which is a cyclical industry currently in a down cycle that is deeper and longer than prior downturns. This uncertainty in the financial markets negatively impacted the availability of financing for U.S. non-governmental commercial construction projects. While there was increased funding for governmental projects from U.S. stimulus spending, the increase in government projects did not offset the decline in private commercial construction projects. New construction of commercial buildings over ten stories in the U.S., a key sector for our Architectural segment, has been negatively impacted to a greater extent than the overall commercial construction market during the current commercial construction downturn. These challenging market conditions resulted in increased competition on construction projects, lower pricing and volumes, and lower capacity utilization in our Architectural segment manufacturing facilities.

Our Large Scale Optical segment, which accounted for 13% of our overall revenues in fiscal 2011, performed well, despite the high U.S. unemployment rate, severity of the general economic recession and low U.S. consumer confidence levels. The segment, which sells value-added glass and acrylic products primarily for the custom picture framing market, continued to convert picture framing customers to high value-added products.

Fiscal 2011 Results. In fiscal 2011, we incurred a loss of $10,332,000, or ($0.37) per share (including earnings of $3,825,000, or $0.14 per share, in discontinued operations) on net sales of $582,777,000, which were approximately 16% and 37% lower than net sales in fiscal 2010 and 2009, respectively. The rate of decline in our net sales was comparable to our markets served. During fiscal 2011, Apogee’s focus was to effectively manage cash and costs during the cyclical downturn and to position our Company for growth when our markets recover. During the year, we increased architectural glass pricing, which we expect will positively impact results in fiscal 2012; we made new capital investments of $9,100,000, primarily for safety, maintenance and productivity improvement projects to maintain our state-of-the art facilities; developed several new products for the green building market; and acquired a glass fabrication company in Brazil to increase penetration of our architectural glass markets in Latin America. After these investments, we maintained a strong financial position, ending fiscal 2011 with a net positive cash position of $38,122,000 and a new $80,000,000 three-year secured revolving credit facility.

Executive Compensation Program. Apogee’s compensation philosophy is to align executive compensation with short-term and long-term performance of our Company, provide a flexible compensation package that takes into account the cyclical nature of our business and fairly compensates our executives over the commercial construction cycle, and provide compensation needed to attract, motivate and retain executive talent to drive the long-term success of our Company. As a result, total compensation is designed to include a mix of short-term and long-term compensation and fixed and variable compensation. Short-term compensation is generally in the form of a base salary (fixed) and annual cash incentives (variable), which are only earned upon achievement of certain annual objective financial performance measures established by the Committee for the fiscal year. Long-term

compensation is generally in the form of two types of equity awards: an annual time-based restricted stock award (fixed) and performance share units (variable), which are earned only upon achievement of certain three-year objective performance measures established by the Committee. The program places significant weight on long-term incentives to motivate executives to achieve annual results in a way that will build and sustain the long-term viability and success of our Company.

Fiscal 2011 Compensation Actions. The following highlights the Committee’s key compensation decisions for fiscal 2011, as reported in the fiscal 2011 Summary Compensation table on page 45. These decisions were made with advice from the Committee’s independent compensation consultant, Pearl Meyer & Partners, and are discussed in greater detail elsewhere in the Compensation Discussion and Analysis.

•

Base Salaries. In fiscal 2010, base salaries for all our Named Executive Officers were frozen at fiscal 2009 levels, reflecting the uncertain and challenging business conditions at that time. Because fiscal 2011 was also anticipated to be a challenging year for our Company, the Committee did not award an increase in base salary to our Chief Executive Officer but awarded base salary increases ranging from 3.0% to 7.8% to our other Named Executive Officers to address retention and market competitiveness concerns. Even with these increases, the fiscal 2011 base salaries for our other Named Executive Officers ranged from the 35^th to 55^th percentiles of comparable positions in the comparable market. Because we anticipate fiscal 2012 will be another challenging year for our Company, fiscal 2012 base salaries for all our Named Executive Officers were frozen at fiscal 2011 levels.

•

Annual Cash Incentives. No annual cash incentives were earned by our Named Executive Officers for fiscal 2011 because our Company did not meet the financial performance metrics for the annual cash incentives established for the fiscal year.

•

Performance Share Awards. The fiscal 2009 – 2011 performance share awards paid out at 49.63% of target because our Company met the market growth metric at above target level but did not meet the threshold level on the return on invested capital (“ROIC”) or earnings per share (“EPS”) metrics for the performance period.

•

Time-Based Restricted Stock Awards. On April 27, 2010, the Committee awarded time-based restricted stock to our Chief Executive Officer with a value equal to 84% of his fiscal 2011 base salary and to our other Named Executive Officers ranging from 23% to 52% of their fiscal 2011 base salaries after determining that each of our Named Executive Officers had substantially met his or her individual business objectives.

•

Total Direct Compensation. Fiscal 2011 total direct compensation (base salary, actual annual cash incentives awarded for fiscal 2011, and long-term incentives granted in fiscal 2011) for our Named Executive Officers was 24% lower than fiscal 2010 total direct compensation because no annual cash incentive compensation was earned for fiscal 2011.

•

Chief Executive Officer Retirement. In connection with Mr. Huffer’s announcement that he intends to retire from the position of Chief Executive Officer by the end of fiscal 2012 and in recognition of his 13 years of service as our Chief Executive Officer and additional 12 years of service to our Company in other senior management positions, the Committee and our Board approved a transition agreement with Mr. Huffer, which is described in more detail under “Chief Executive Officer Retirement” on page 42.

•

Acceleration of Vesting of Unvested Shares of Restricted Stock Held under Our Legacy Partnership Plan. We accelerated the vesting of 80,462 shares of restricted stock held by 15 participants, including our Chief Executive Officer and three of our other Named Executive Officers, under our Legacy Partnership Plan. All shares were related to compensation earned from fiscal 2001 through fiscal 2005 and would have vested in annual installments on May 1 from 2011 through 2015. Our Legacy Partnership Plan was eliminated from our compensation program in fiscal 2006, and the acceleration of vesting eliminates the cost of administering this legacy compensation plan.

•

Resignation of Officer. In connection with Mr. Silvestri’s resignation as our Executive Vice President and President of Viracon, Inc. effective as of March 11, 2011, the Committee approved a separation agreement with Mr. Silvestri, which is described in more detail under “Resignation of Officer” on page 43.

Improvements to Our Executive Compensation Program. The Committee continues to refine our executive compensation program to reflect evolving executive compensation best practices.

•

Change-In-Control Severance Program. During fiscal 2011, we modified our change-in-control severance program to eliminate the tax gross-up payment with respect to excise tax liability, if any, under Internal Revenue Code Section 4999 related to Section 280G excess parachute payments. In addition, we added requirements that as a condition to receive any change-in-control payments, the executive has to agree not to compete with our Company or solicit our employees to leave their employment for a specified period of time and sign a release of employment-related claims against our Company. The change-in-control severance agreements that are a part of our current change-in-control severance program continue to be “double trigger” agreements and provide that, in the event of a change-in-control, the executive would have specific rights and receive certain benefits if his or her employment was terminated “without cause” or he or she voluntarily terminated his or her employment for “good reason.” Commencing with awards made in fiscal 2012, the time-based restricted stock and performance share unit award agreements will be “double trigger” agreements and provide that, in the event of a change-in-control, the vesting of the awards would accelerate only if the executive’s employment was terminated “without cause” or he or she voluntarily terminated his or her employment for “good reason.”

•

Hedging Policy. During fiscal 2011, we adopted a formal policy that prohibits employees and Board members from engaging in hedging transactions related to our Company’s securities.

•

Non-Qualified Deferred Compensation Plan. We established a new non-qualified deferred compensation plan to assist executives in saving for retirement and other short-term needs on a pre-tax basis and discontinued any new deferral elections into our Legacy Deferred Compensation Plan effective as of January 1, 2011.

•

Other Improvements. Prior to fiscal 2011, we made various changes to our executive compensation program. During fiscal 2009, we froze participation in our Legacy SERP and eliminated certain perquisites, including auto allowances, company-paid executive health physicals, and reimbursement of club memberships and spousal travel. Beginning with fiscal 2010, we modified our long-term compensation program to award performance share units, which earn dividends only on the shares earned at the end of the performance period.

Overview of Primary Compensation Elements

The table below provides an overview of the three primary compensation elements used in our executive compensation program.


Compensation Element	Objective	How Determined	Market Positioning⁽¹⁾
Base Salary	Attract, motivate and retain executives by offering pay and benefit programs that are competitive with the market.	Annual subjective performance evaluation of an executive’s leadership and achievement of individual business objectives, experience, tenure, competitive market data and trends, internal equity among positions within our Company with similar responsibilities, executive potential and our Company’s business outlook.	Targeted to be around the 50^th percentile relative to competitive market practices.

Annual Cash Incentive Compensation	Reward achievement of pre-defined short-term Company performance results. Provide a flexible compensation package that reflects the cyclical nature of our business.	For target bonus award opportunity percentages – competitive market data and trends and internal equity among positions within our Company with similar responsibilities. For actual bonus payouts – performance against pre-established criteria in our annual cash incentive plan and annual subjective performance evaluation of an executive’s leadership and achievement of individual business objectives.	Target level performance results in target total cash compensation (base salary plus annual cash incentive compensation) that is generally at or below the 50^th percentile. Above target performance results in maximum total cash compensation that is slightly above the 50^th percentile. Below target performance results in threshold total cash compensation that is generally at or below the 25^th percentile.

Long-Term Equity Incentive Compensation: • Time-Based Restricted Stock and • Performance Share Units	Align the interests of executives with shareholders and to focus on long-term sustained performance. Create appropriate retention incentives through the use of multi-year vesting schedules. Provide an opportunity for executives to build a meaningful equity position in Apogee.	Annual subjective performance evaluation of an executive’s leadership and achievement of individual business objectives, Company performance, market data and trends, internal equity among positions within our Company with similar responsibilities and executive potential.	Targeted generally to be at or slightly above the 50^th percentile for target performance and up to the 75^th percentile for maximum performance.

⁽¹⁾	Actual pay levels can be above or below the targeted level depending on all of the factors outlined in the “How Determined” column in the table above.

Fiscal 2011 Executive Compensation Mix at Target

The charts below illustrate the mix of base salary, annual cash incentive compensation at target, and long-term equity compensation consisting of time-based restricted stock and performance share units at target performance for fiscal 2011 for our Chief Executive Officer and other four Named Executive Officers as a group.

LOGO

Fiscal 2011 Short-Term and Long-Term Compensation Mix at Target

The charts below illustrate the mix of short-term compensation (cash) and long-term compensation (equity) at target performance for fiscal 2011 for our Chief Executive Officer and other four Named Executive Officers as a group.

LOGO

Compensation Process

The compensation program is evaluated annually taking into consideration changes to our business strategy and plans. The Committee considers each element of compensation outlined above, both individually and collectively, when evaluating compensation adjustments and the interrelation between each compensation element to ensure that the entire program is appropriately aligned. The Committee reviews a compensation “tally sheet,” which lists total direct compensation (base salary, annual cash incentive compensation and long-term equity incentive awards), perquisites, other elements of executive compensation, broad-based employee benefits and wealth accumulation through Company equity and retirement plans for our Named Executive Officers. The compensation tally sheet is one of the factors used by the Committee to make individual compensation decisions. The Committee does not generally consider compensation earned in prior years in establishing the elements and levels of compensation for the current fiscal year. The Committee also reviews its compensation consultant’s independent analyses of compensation for our Named Executive Officers and other executive officers and senior management based on comparable positions using both published survey sources and company proxy statement data to determine our competitive positioning relative to the competitive market.

The Committee sets the elements of compensation for our Named Executive Officers, taking into consideration the results of their annual performance evaluations, and competitive market data from the Committee’s independent compensation consultant. Our Chief Executive Officer makes recommendations to the Committee on compensation for our other Named Executive Officers, but does not participate in the determination of his own compensation. The Committee reviews our Chief Executive Officer’s compensation with our full Board prior to communicating compensation decisions to our Chief Executive Officer.

Annual base salary increases, if awarded, generally are effective in May of each year. The Committee makes the annual grant of long-term equity awards to executives primarily at its regularly scheduled meeting held during the Company’s first quarter of each fiscal year, generally in late April or early May. The exact date of such meeting is generally established by the Committee more than a year in advance of the meeting.

Consulting Assistance, Competitive Market and Compensation Positioning

Use of Independent Compensation Consultant. The Committee has retained Pearl Meyer & Partners to provide advice regarding compensation program design, competitive practices, market trends, peer group composition and compensation for our Chief Executive Officer, other executive officers and other members of senior management. Pearl Meyer & Partners reports directly to the Committee, is independent of our Company and does not provide any other services to our Company beyond those requested by the Committee or our Nominating and Corporate Governance Committee with respect to reviewing and structuring the compensation program for our Board of Directors. Pearl Meyer & Partners does not establish compensation levels for our executives. Pearl Meyer & Partners regularly attends the meetings of the Committee.

Competitive Market Defined. The Committee uses a combination of peer group companies and surveys of manufacturing and general industry executive compensation to identify competitive market compensation practices and our overall competitive position for our executives. The Committee relies on its independent compensation consultant to review and develop a set of appropriate peer group companies and identify and use appropriate executive compensation survey sources.

The selection criteria identified for determining and/or reviewing our Company’s peer group generally include:

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Companies with revenue within a range similar to that of Apogee.

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Companies in the same or similar GICS code as Apogee or its business units.

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Companies with business model similarity, which may include the following:

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Provides coatings for special purposes (i.e., protective, UV, etc.),

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Construction materials, primarily for commercial or industrial application,

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Specialized/customized product lines,

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Heavy-duty manufacturing operations and project-directed manufacturing,

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Project-based businesses,

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Revenues generated primarily in the United States (U.S. sales greater than 60%),

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Inclusion in the prior-year peer group, to help ensure year-over-year consistency (where appropriate),

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Market capitalization to revenue ratio (greater than 0.4), and

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Geographic location (to a lesser degree).

During fiscal 2009, using the selection criteria outlined above, the Committee identified a peer group consisting of 22 companies (the “Peer Group”). All of the companies in the Peer Group meet four or more of the selection criteria outlined above. The 22 companies in our Peer Group include:


Actuant Corporation				Insituform Technologies, Inc.
Azz incorporated				Lydall, Inc.
CLACOR, Inc.				Mueller Water Products, Inc.
Columbus McKinnon Corporation				NCI Building Systems, Inc.
Daktronics, Inc.				Polaris Industries Inc.
Donaldson Company, Inc.				Quaker Chemical Corporation
Eagle Materials Inc.				Quanex Building Products Corporation
EnPro Industries, Inc.				Tennant Company
Graco Inc.				Thomas & Betts Corporation
Griffon Corporation				The Toro Company
H.B. Fuller Company				Valmont Industries, Inc.

The Committee, with the assistance of its independent compensation consultant, annually reviews the Peer Group in order to maintain its appropriateness for future compensation comparison purposes, and reviews and validates the selection criteria to ensure it is in line with our business strategies. The Committee re-evaluated the Peer Group during fiscal 2010 and 2011 and decided not to make any changes to the Peer Group.

Components of Our Compensation Program

Base Salary. Base salary reflects a fixed portion of the overall compensation package and is the base amount from which other compensation elements are determined, such as target annual cash and long-term equity incentive compensation award opportunities, benefits and retirement savings opportunities.

Annual Cash Incentive Compensation. Our annual cash incentive awards to all our Named Executive Officers are made pursuant to our Amended and Restated Executive Management Incentive Plan (the “Executive MIP”), which was adopted to ensure the tax deductibility of the annual cash incentive compensation that may be earned by our Named Executive Officers. Our Executive MIP is designed to be an annual bonus “pool” plan. Each fiscal year, the Committee establishes a bonus pool equal to a percentage of one or more performance factors from a list of approved factors set forth in our Executive MIP. Our Company must meet the selected performance factor for the bonus pool in order for a bonus pool to be established for the fiscal year.

Each fiscal year the Committee selects the executives of our Company who will participate in our Executive MIP for that year and assigns a percentage of the bonus pool to each participating executive, with the total percentage not to exceed 100% for any given year. The percentage of the bonus pool assigned to each participating executive (determined as a percentage of base salary) establishes the maximum annual cash incentive award payout for that individual participant for the current fiscal year; however, no one individual payout can exceed $1,500,000 in any given fiscal year.

The actual annual cash incentive awards to be paid to participants after the annual bonus pool has been established may be adjusted downward based on the achievement of one or more additional predetermined, objective performance goals based on the annual operating plan approved by our Board. At least one of the additional predetermined objectives must be met at the threshold level in order for an annual cash incentive to be paid to an executive.

Generally, if the threshold performance level for all financial goals is achieved, 50% or less of the target award will be paid; if target performance level for all financial goals is achieved, 100% of the target award will be paid; and if maximum performance level for all annual financial goals is achieved, 200% of the target award will be paid. If threshold performance level for only one financial metric is achieved and threshold performance is not achieved for any of the other financial goals, less than 50% of the target award will be paid based on the weighting allocated to that specific financial performance goal. For any performance between these levels, awards will be interpolated. The Committee has the discretion to further reduce payouts under our Executive MIP as appropriate.

Long-Term Equity Incentive Compensation. We utilize two forms of equity instruments to deliver long-term equity incentive compensation each year. The mix of long-term incentive instruments is determined annually by the Committee. The mix of long-term incentive compensation for our executive officers for fiscal 2011 was approximately 40% time-based restricted stock awards and 60% performance share units.

Time-Based Restricted Stock. Each year, the Committee determines a fixed dollar value of the time-based restricted stock award for each executive based on achievement by the individual of his or her business objectives for the just-completed fiscal year. The fixed dollar value is determined as a percent of base salary and is set to align with competitive market practices. The time-based restricted stock awards will generally vest in three equal annual installments commencing on the first anniversary date of the award.

Performance Share Units. At the beginning of each fiscal year, a new three-year performance period begins and the corporate financial performance goals for that period are determined by the Committee. Each year, the Committee determines the fixed dollar value of performance share units that will be granted to each participating executive officer at the threshold, target and maximum performance levels based on input from our Chief Executive Officer and consideration of individual performance, our Company performance, market data and trends, internal equity and executive potential. The fixed dollar value is determined as a percentage of base salary and is set to align with competitive market practices.

The performance share units represent the right to receive shares of our common stock at the end of the three-year performance period. If we perform better than the target level, more performance share units will vest. Likewise, if we perform below the target level, fewer or no performance share units will vest. Until issuance of the shares at the end of the three-year performance period, a participant has no voting rights but dividends or other distributions (whether cash, stock or otherwise) accrue during the three-year performance period and will be paid only on the shares earned at the end of the performance period when such shares are issued.

Other Benefit Programs. Executive officers are eligible to participate in our current benefit plans listed below.

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Deferred Incentive Compensation Plans — Our executive officers may also participate in voluntary non-qualified deferred incentive compensation plans that allow participants to defer compensation to assist in saving for retirement and other short-term needs. These plans are described under the headings “2011 Non-Qualified Deferred Compensation Plan” on page 54 and “Legacy Deferred Compensation Plan” on page 55.

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Legacy SERP — We also provided a non-qualified defined benefit retirement compensation plan to certain executive officers. Our Legacy SERP was frozen in October 2008 and at that time only three current employees were participants. This plan is described under the heading “Legacy Officers’ Supplemental Executive Retirement Plan” on page 53.

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Other Benefits — Executive officers may participate on the same terms as all other employees in our 401(k) Retirement Plan, which is described under the heading “401(k) Retirement Plan” on page 54, and our Employee Stock Purchase Plan, which allows participants to purchase shares of our Company’s common stock by contributing up to $500 per week, with our Company contributing an amount equal to 15% of the participant’s weekly contributions. Executive officers also receive the same health and welfare benefits as offered to all other full-time employees, with the exception that we offer enhanced long-term disability benefits to our executive officers.

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Perquisites — The only perquisites we make available to our Named Executive Officers are reimbursement of financial and estate planning fees of up to $2,000 annually, enhanced long-term disability benefits and payment of relocation expenses.

Change-in-Control Program

The Committee believes that offering a change-in-control program provides executive officers a degree of security in the event of a corporate transaction and allows for better alignment of executive officer and shareholder interests. In January 2011, our Company approved new change-in-control severance agreements that eliminated the tax gross-up payment with respect to excise tax liability, if any, under Internal Revenue Code Section 4999 related to Section 280G excess parachute payments, which our Company entered into in March 2011 with certain executive officers, including our Named Executive Officers other than Mr. Silvestri. The new change-in-control severance agreements contain a “best-net-benefit” provision which provides that in the event that payments under the agreement trigger excise tax for the executive, the executive has the option to reduce the severance payment if the net benefit is greater than paying the excise tax himself or herself. The Committee believes that a “best-net-benefit” provision is more equitable to our Company and our shareholders. All of the new severance agreements, like the prior agreements, contain a “double trigger” for change-in-control benefits, which means that there must be both a change-in-control and a termination of employment for the provisions to apply. The Committee believes a “double trigger” is more equitable than a “single trigger” because it prevents unnecessary payments to Named Executive Officers in the event of a friendly (non-hostile) change-in-control in which the Named Executive Officer’s employment is not terminated and the Named Executive Officer continues to be employed without an adverse effect on his or her compensation, role, responsibilities or job location. The Committee does not consider specific amounts payable under these arrangements when establishing annual compensation. See “Change-in-Control Severance Agreements” on page 57 and “Executive Benefits and Payment Upon Termination” on page 58 for more information on these arrangements.

Compensation Related Policies

Stock Ownership Guidelines for Executive Officers. Our Board of Directors believes that our executive officers should have a significant equity interest in our Company and established voluntary stock ownership guidelines for our executive officers in 2001. The guidelines encourage share ownership in an amount having a market value of a multiple of an executive officer’s annual base salary, to be achieved within five years of becoming an executive officer. For purposes of calculating stock ownership of our executive officers, we include issued but unearned Performance Shares, performance share units at target level, and shares of restricted stock and restricted stock units. We do not include unexercised stock options or SARs. The guideline is five times the annual base salary for our Chief Executive Officer and President; three times annual base salary for our Executive Vice Presidents, Chief Financial Officer and General Counsel; and two times annual base salary for our other executive officers. As of February 25, 2011, the last trading day of fiscal 2011, all our Named Executive Officers, except Mr. Silvestri, who resigned from our Company effective as of March 11, 2011, had achieved their stock ownership guidelines. The Committee reviews share ownership levels of our executive officers annually.

Hedging Policy. Our Board of Directors believes that the interests of our executive officers and employees and members of our Board of Directors should be aligned with the interests of our shareholders. As a result, we have adopted a hedging policy that prohibits all employees, including our Named Executive Officers, and members of our Board of Directors from engaging in the purchase or sale of financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds) that are designed to hedge or offset any decrease in the market value of our Company’s securities.

Fiscal 2011 Executive Compensation Process and Decisions

Annual Performance Evaluations. Annually, the performance of each of our Named Executive Officers is evaluated based on subjective assessments of his or her executive leadership and achievement of agreed-upon individual business objectives for the just-completed fiscal year. For fiscal 2011, in addition to the financial objectives for annual cash incentives and performance share units, the individual business objectives for our Named Executive Officers were based on the following:


Name and Principal Position		Fiscal 2011 Individual Business Objectives
Russell Huffer Chairman, Chief Executive Officer and President		Operational and financial performance, strategy development and implementation, succession planning, and execution of our Company-wide enterprise resource planning implementation.

James S. Porter Chief Financial Officer		Operational and financial performance, strategy development and implementation, succession planning, and execution of our Company-wide enterprise resource planning implementation.

Gregory A. Silvestri Executive Vice President and President of Viracon, Inc.		Operational and financial performance, strategy development and implementation at our Viracon, Inc. subsidiary, safety, and succession planning.

Patricia A. Beithon General Counsel and Corporate Secretary		Corporate governance and compliance, strategy implementation, litigation management, and environmental compliance.

Gary R. Johnson Vice President and Treasurer		Enterprise risk management, safety, working capital and cash management, credit facility management, strategy implementation, tax strategy, and real estate portfolio management.

The annual performance evaluations of our Named Executive Officers are subjective assessments of their executive leadership and achievement against their individual business objectives. The annual performance evaluation of our Chief Executive Officer is conducted by our Nominating and Corporate Governance Committee, with all non-employee directors completing a performance evaluation of our Chief Executive Officer. The results of the annual performance evaluation of our Chief Executive Officer are reviewed by the Nominating and Corporate Governance Committee, the Committee and our full Board. Our Chief Executive Officer generally conducts the annual performance evaluations of our other Named Executive Officers and reviews the results with members of the Committee. The subjective annual performance evaluations of our Named Executive Officers’ achievement against their individual business objectives for the just-completed fiscal year are important factors used by the Committee in determining the appropriate pay levels for our Named Executive Officers for the upcoming fiscal year, and in deciding whether to reduce the annual cash incentive award for the just-completed fiscal year. In addition, the annual performance evaluations of our Named Executive Officers’ achievement against their respective individual business objectives for the just-completed fiscal year are the primary criteria used by the Committee in making the time-based restricted stock component of long-term equity incentive compensation.

Base Salaries. The amount of base salary and year-over-year increase for each of our Named Executive Officers for fiscal 2009 through 2012 are set forth in the following table.


	Base Salary
Name	Fiscal Year 2009 ($)	Fiscal Year 2010 ($)	Percent Increase in Fiscal Year 2010 (%)	Fiscal Year 2011 ($)	Percent Increase in Fiscal Year 2011 (%)	Fiscal Year 2012 ($)	Percent Increase in Fiscal Year 2012 (%)
Russell Huffer	700,000	700,000	0.0	700,000	0.0	700,000	0.0
James S. Porter	334,750	334,750	0.0	360,700	7.8	360,700	0.0
Gregory A. Silvestri⁽¹⁾	350,200	350,200	0.0	360,700	3.0	N/A	N/A
Patricia A. Beithon	277,070	277,070	0.0	285,400	3.0	285,400	0.0
Gary R. Johnson	182,935⁽²⁾	192,679⁽²⁾	5.3⁽²⁾	198,459	3.0	198,459	0.0

⁽¹⁾	Mr. Silvestri resigned from our Company effective as of March 11, 2011.

⁽²⁾	Mr. Johnson’s annual base salary was increased to $192,679 effective January 1, 2009, when we eliminated automobile allowances for our executive officers. None of our other Named Executive Officers received base salary increases as a result of elimination of this perquisite.

For fiscal 2010, the Committee froze the base salaries of our Named Executive Officers at fiscal 2009 levels. For fiscal 2011, the Committee did not increase the Chief Executive Officer’s base salary; however, the Committee approved a base salary increase of 7.8% for Mr. Porter in order to align his salary closer to the competitive market and base salary increases of 3% to our remaining Named Executive Officers to address potential retention and market competitiveness concerns during various points in the commercial construction cycle. Fiscal 2012 base salary was frozen at the fiscal 2009 level for our Chief Executive Officer and at fiscal 2011 levels for our other Named Executive Officers due to challenging market conditions.

The fiscal 2011 base salaries of our Named Executive Officers averaged at the 47^th percentile of comparable positions in the competitive market, ranging from the 35^th to the 55^th percentile for our Named Executive Officers. The fiscal 2012 base salaries of our Named Executive Officers averaged approximately the 49^th percentile, ranging from the 40^th to the 55^th percentile.

Fiscal 2011 Annual Cash Incentive Compensation. For fiscal 2011, the annual cash incentive compensation for all our Named Executive Officers was made pursuant to our Executive MIP and the performance factor used to establish the bonus pool under our Executive MIP was Apogee operating income. The performance goals used for fiscal 2011 to make downward adjustments to the annual cash incentive awards to be paid to our Named Executive Officers under our Executive MIP were a combination of Apogee net sales and earnings per share from continuing operations and Viracon net sales and earnings before taxes (“EBT”). The table below sets forth certain information with respect to the fiscal 2011 annual cash incentive performance goals under our Executive MIP.


	Fiscal 2011 Annual Cash Incentive Performance Goals
Performance Goal	Threshold		Target		Maximum
Apogee Net Sales	$	576,900,000	$	610,400,000	$	665,300,000
Apogee EPS from Cont. Ops.	$	0.00	$	0.09	$	0.27
Viracon Net Sales		85% of fiscal 2010 net sales		89% of fiscal 2010 net sales		98% of fiscal 2010 net sales
Viracon EBT		20% less than fiscal 2010 EBT		20% less than fiscal 2010 EBT		21% increase over fiscal 2010 EBT

The Committee believes the fiscal 2011 Apogee net sales and EPS from continuing operations performance goals and Viracon net sales and EBT performance goals were challenging and difficult to achieve based on the severity of the downturn in the U.S. commercial construction market and the anticipated low capacity utilization at Viracon’s fabrication facilities.

The table below sets forth certain information with respect to fiscal 2011 annual cash incentive compensation award payout ranges as a percentage of fiscal 2011 salary for our Named Executive Officers.


	Fiscal 2011 Annual Cash Incentive Compensation
Name	Threshold Payout as a Percentage of Salary (%)⁽¹⁾	Target Payout as a Percentage of Salary (%)⁽²⁾	Maximum Payout as a Percentage of Salary (%)⁽³⁾
Russell Huffer	12.38	75.00	150.00
James S. Porter	9.90	60.00	120.00
Gregory A. Silvestri	5.50	55.00	110.00
Patricia A. Beithon	8.25	50.00	100.00
Gary R. Johnson	4.13	25.00	50.00

⁽¹⁾	Assumes threshold performance level is achieved for only the financial performance goal with the lowest weighting and is not achieved for any other financial performance goals. If actual results are below threshold performance level, the payout will be zero.

⁽²⁾	Assumes target performance level is achieved for all financial performance goals.

⁽³⁾	Assumes maximum performance level is achieved for all financial performance goals.

In fiscal 2011, Apogee achieved net sales of $582,777,000, slightly above threshold, and incurred a loss per share from continuing operations of ($0.51) and our Viracon, Inc. subsidiary did not achieve threshold performance on either its net sales or EBT metrics. Because we incurred an operating loss for fiscal 2011, no bonus pool was created under our Executive MIP and none of our Named Executive Officers earned an annual cash incentive payout for fiscal 2011. The nonpayment of any annual cash incentive awards for fiscal 2011 to our Named Executive Officers is disclosed in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table” on page 45.

Fiscal 2011 Long-Term Equity Incentive Compensation. In determining time-based restricted stock awards for each of our Named Executive Officers, the Committee began its deliberations with a targeted fixed dollar value, as a percentage of salary, which was based on competitive levels of total direct compensation for comparable positions in the competitive market, based on data provided by the Committee’s independent compensation consultant. The Committee determined a final fixed dollar value for each Named Executive Officer after considering our Board’s subjective evaluation of the performance of our Chief Executive Officer against his individual business objectives for fiscal 2010 and our Chief Executive Officer’s subjective assessment of the performance of each of our other Named Executive Officers against his or her individual business objectives for fiscal 2010. The individual business objectives for fiscal 2010 for each of our Named Executive Officers were based on the following:


Name and Principal Position		Fiscal 2010 Individual Business Objectives
Russell Huffer Chairman, Chief Executive Officer and President		Operational and financial performance, strategy implementation, succession planning, and execution of our Company-wide enterprise resource planning implementation.

James S. Porter Chief Financial Officer		Operational and financial performance, strategy development and implementation, succession planning, leadership development, and execution of our Company-wide enterprise resource planning implementation.

Gregory A. Silvestri Executive Vice President and President of Viracon, Inc.		Operational and financial performance, safety, succession planning, leadership development, and strategy development and implementation at our Viracon, Inc. subsidiary.

Patricia A. Beithon General Counsel and Corporate Secretary		Strategy implementation, litigation management, and human resources and environmental compliance.

Gary R. Johnson Vice President and Treasurer		Enterprise risk management, safety, real estate portfolio management, tax strategy, and working capital and cash management.

On April 27, 2010, the Committee determined that each of our Named Executive Officers had substantially met his or her individual business objectives for fiscal 2010 and awarded our Named Executive Officers time-based restricted stock as follows:


Name	Time-Based Restricted Stock Awarded (#)		Value of Award ($)		Percentage of Fiscal 2011 Salary (%)		Grant Price ($)
Russell Huffer		43,504		589,479		84		13.55
James S. Porter		13,800		186,990		52		13.55
Gregory A. Silvestri		13,800		186,990		52		13.55
Patricia A. Beithon		11,020		149,321		52		13.55
Gary R. Johnson		3,383		45,840		23		13.55

On April 27, 2010, the Committee determined the fixed dollar value for the performance share units as a percentage of base salary at the threshold, target and maximum award levels for each of our Named Executive Officers for the performance share unit awards. Based on this analysis and review, the Committee awarded performance share units to our Named Executive Officers on April 27, 2010 as follows:


Name	Number of Performance Share Units Issued at Target Level (#)⁽¹⁾		Value of Performance Share Units Issued at Target Level ($)⁽¹⁾		Percentage of Fiscal 2011 Base Salary (%)		Additional Performance Share Units to be Received if Maximum Level of Performance is Achieved (#)
Russell Huffer		52,694		714,004		102		52,694
James S. Porter		19,166		259,699		72		19,166
Gregory A. Silvestri		19,166		259,699		72		19,166
Patricia A. Beithon		15,165		205,486		72		15,165
Gary R. Johnson		4,833		65,487		33		4,833

⁽¹⁾	The number of performance share units issued at target level was determined by dividing the value of performance share units issued at target level by $13.55, the closing price of our common stock on the NASDAQ Global Select Market on April 27, 2010, the date of grant.

Long-term compensation awards made during fiscal 2011 (restricted stock awards and performance share units awarded on April 27, 2010) to our Named Executive Officers averaged approximately at the 56^th percentile, based on data provided by the Committee’s independent compensation consultant, ranging from 45% to 65% for our Named Executive Officers.

Fiscal 2011 Total Direct Compensation. Total direct compensation for fiscal 2011 (base salary and long-term incentives granted on April 27, 2010, during fiscal 2011) for our Named Executive Officers averaged approximately at the 36^th percentile, based on data provided by the Committee’s independent compensation consultant. The chart below illustrates the actual and target total direct compensation for fiscal 2011 for our Chief Executive Officer and other four Named Executive Officers as a group and the competitive market positioning of those amounts.

LOGO

Fiscal 2009 - 2011 Performance Share Payouts. At the beginning of fiscal 2009, performance share awards having a three-year performance period from fiscal 2009 through fiscal 2011 were granted. On the grant date, the participant received: (1) the number of shares of our common stock equal to the target number of performance shares (the “Issued Shares”), and (2) the right to receive an amount of additional shares of our common stock equal to the difference between the maximum number of performance shares and the target number of performance shares (the “Additional Shares” and, together with the Issued Shares, the “Performance Shares”). The Issued Shares are subject to forfeiture and certain other restrictions during the performance period. The number of Issued Shares that may be retained and the number of Additional Shares, if any, that may be issued at the end of the performance period may vary from 0% to 200% of the Issued Shares, with the number dependent on meeting the corporate financial performance goals for such Performance Share award.

Upon issuance of the Issued Shares, the participant had, subject to certain restrictions, all the rights of a shareholder with respect to the Issued Shares (including voting rights and the right to receive any dividends or other distributions (whether cash, stock or otherwise) paid on the Issued Shares during the performance period), unless and until such Issued Shares are forfeited. In April 2009, the Committee modified our long-term compensation program to award performance share units, which earn dividends only on the shares earned at the end of the performance period. With the payout of the fiscal 2009 – 2011 Performance Shares on April 26, 2011, we no longer have any Performance Share awards outstanding.

The minimum, target and maximum goals for the fiscal 2009 – 2011 Performance Share awards are set forth below.

Fiscal 2009 - 2011 Performance Share Awards Payout Metrics


Performance Metric	Weight (%)	Minimum (50%)			Target (100%)			Maximum (200%)
Average ROIC	33-1/3		14.5	%		16.0	%		17.5	%
Cumulative EPS	33-1/3	$	6.06		$	6.35		$	6.85
Market Share Growth⁽¹⁾ (33-1/3%)
Architectural Segment	28-1/3		0.0	%		4.0	%		8.0	%
Large-Scale Optical Segment	5		20.0	%		25.0	%		30.0	%

⁽¹⁾

The target for Architectural segment growth at the end of the performance period was set at 4.0% above market growth (or 4.0% less than the market decline) in the U.S. commercial construction market for the performance period as reported in the McGraw Hill report, which is an industry report regarding growth in the construction industry, adjusted for the number of months by which our Architectural segment lags the general commercial construction industry. The Committee relies on the McGraw Hill report published just prior to the Committee meeting at which the payout is determined. The target for Large-Scale Optical segment value-added picture framing glass and acrylic growth was pre-set at a 25% increase in market share.

After completion of our fiscal 2011 audit, it was determined that the payout on the fiscal 2009 – 2011 Performance Share awards was as set forth below.

Fiscal 2009 - 2011 Performance Share Payout Percentage


Performance Metric	Actual Performance			Percentage Earned (%)		Weight (%)		Percentage Payout (%)
Average ROIC		5.6	%		—		33-1/3		—
Cumulative EPS	$	2.58			—		33-1/3		—
Market Share Growth⁽¹⁾
Architectural Segment (85% of 33-1/3%)		6.3	%		157.50		28-1/3		44.63
Large-Scale Optical Segment (15% of 33-1/3%)		25.0	%		100.00		5		5.00

Total									49.63	⁽²⁾

⁽¹⁾

During fiscal 2010, we refined the methodology for calculating the market share growth used for internal reporting purposes to better reflect our ability to compute market share growth based on market data that was not previously available to us. The Committee used the refined methodology to compute the market share growth metrics for the fiscal 2009 – 2011 Performance Share awards to be consistent with the methodology we use to calculate market share growth for internal reporting purposes and used to calculate market share growth metrics for the fiscal 2008 – 2010 Performance Share awards.

⁽²⁾	If the market share growth metrics for the Architectural segment and Large-Scale Optical segment had not been refined, as described in the footnote above, the fiscal 2009 – 2011 Performance Share award would have paid out at the 5.0% level.

Additional information regarding the 2009 – 2011 Performance Share payouts follows:

Fiscal 2009 - 2011 Performance Share Payout


Name	Target Level of Shares (#)		Shares Forfeited (#)		Total Performance Share Payout (#)⁽¹⁾		Market Value of Total Performance Share Payout ($)⁽²⁾
Russell Huffer		32,422		16,331		16,091		227,688
James S. Porter		11,629		5,858		5,771		81,660
Gregory A. Silvestri⁽³⁾		12,165		12,165		—		—
Patricia A. Beithon		9,625		4,848		4,777		67,595
Gary R. Johnson		3,389		1,707		1,682		23,800

⁽¹⁾	Equals the share amount in the “Target Level of Shares” column less the amount in the “Shares Forfeited” column.

⁽²⁾	Market value of the total performance share payout is calculated by multiplying the closing price ($14.15) of our common stock on the NASDAQ Global Select Market on April 26, 2011, the date the Committee approved the final award, by the number of performance shares earned.

⁽³⁾	Mr. Silvestri forfeited his fiscal 2009 – 2011 Performance Share Award upon his resignation from our Company effective as of March 11, 2011.

Fiscal 2011 Executive Compensation Mix as Earned. The charts below illustrate the mix of base salary and long-term equity compensation consisting of the time-based restricted stock awarded on April 27, 2010 and payout of the Fiscal 2009 – 2011 Performance Share awards on April 26, 2011, and reflecting that no annual cash incentives for fiscal 2011 were earned.

LOGO

Chief Executive Officer Retirement. On January 19, 2011, at a regularly scheduled Board meeting, Mr. Huffer informed our Board of Directors that he intended to retire from the position of Chief Executive Officer of our Company by the end of fiscal 2012, but would continue to serve as Chief Executive Officer until his successor was elected. On April 27, 2011, we entered into a transition agreement with Mr. Huffer. Pursuant to such agreement, Mr. Huffer will retire as our Chief Executive Officer on the earlier of February 25, 2012 (the “Retirement Date”) and the date on which his successor as chief executive officer is elected by our Board. He will remain our employee through February 25, 2012. For his services in fiscal 2012, Mr. Huffer will receive an annual base salary of $700,000, which is the same base salary he has received since fiscal 2009, and will be eligible to receive annual cash incentive compensation under our Executive MIP in an amount up to $525,000, 75% of his annual base salary. Mr. Huffer’s fiscal 2012 annual cash incentive compensation will be pro-rated based on the time that he serves as our Chief Executive Officer during fiscal 2012. Mr. Huffer will not receive any new long-term equity incentive awards for fiscal 2012.

In recognition of his 25 years of service to our Company, including 13 years as Chief Executive Officer and 12 years of service in other senior management positions, pursuant to his transition agreement, on April 15, 2012, we will pay Mr. Huffer $1,225,000 in cash, which is equal to his current annual base salary plus his target annual cash incentive compensation for fiscal 2011 (the “Transition Amount”) and $32,000 to defray premium costs for continuation of medical and dental insurance from his retirement through the COBRA period and until he reaches the age of 65 (the “Insurance Amount”). In addition, we will also provide Mr. Huffer with transition assistance and reimburse Mr. Huffer for legal fees and expenses incurred in connection with negotiation of the transition agreement up to a maximum aggregate amount of $50,000. The transition agreement also provides that as of the Retirement Date, the 45,542 shares of unvested restricted stock awards held by him pursuant to our Amended and Restated 2002 Omnibus Stock Incentive Plan and 2009 Stock Incentive Plan will be accelerated and immediately vested. In the event he dies or becomes disabled prior to the Retirement Date, Mr. Huffer or his estate, as applicable, shall be entitled to receive a pro-rata portion of his annual cash incentive compensation for fiscal 2012 to the extent earned, the Transition Amount, the Insurance Amount and reimbursement of legal fees and expenses as provided in the transition agreement. In consideration of the foregoing, Mr. Huffer agreed to enter into a general release of our Company from any and all claims and causes of action of any kind that he has or may have had against our Company. In addition, Mr. Huffer has agreed to continue to be subject to the noncompetition and nonsolicitation covenants contained in each of his equity award agreements and each of the retirement plans in which he is a participant.

Acceleration of Vesting of Shares under Our Legacy Partnership Plan. Our Legacy Partnership Plan was eliminated from our compensation program at the beginning of fiscal 2006. As of December 31, 2010, only an aggregate of 92,031 shares of restricted stock under such plan remained unvested, which were held by 18 current and former employees, including our Chief Executive Officer and three other Named Executive Officers. Such shares were due to vest in annual installments on May 1, 2011 through 2015. In years 2014 and 2015, less than an aggregate of 8,000 shares would vest each year and be distributed to 12 participants. To eliminate the extra effort and cost of administering this plan, which has not been a part of our compensation program for six years, the Committee authorized management to allow participants to accelerate vesting of all unvested shares of restricted stock under our Legacy Partnership Plan to February 18, 2011. Fifteen participants holding an aggregate of 80,462 shares elected to accelerate vesting, resulting in compensation expense of $334,726, which we recognized in fiscal 2011. All such shares related to compensation earned by participants between fiscal 2001 and fiscal 2005.

Our four Named Executive Officers who held unvested shares of restricted stock pursuant to our Legacy Partnership Plan elected to accelerate vesting of all unvested shares of restricted stock held by them pursuant to our Legacy Partnership Plan. Information with respect to the acceleration of vesting of the unvested shares of restricted stock held by our Named Executive Officers in our Legacy Partnership Plan is set forth below.


Name	Number of Shares of Unvested Restricted Stock under Our Legacy Partnership Plan That Vested on February 18, 2011 (#)		Acceleration Date Fair Value ($)⁽¹⁾
Russell Huffer		23,286		340,441
James S. Porter		5,574		81,492
Gregory A. Silvestri		—		—
Patricia A. Beithon		10,383		151,799
Gary R. Johnson		2,887		42,208

⁽¹⁾

The fair value of the shares of unvested restricted stock under our Legacy Partnership Plan that became vested on February 18, 2011 is calculated by multiplying the number of shares of restricted stock by $14.62, the closing price of our common stock on the NASDAQ Global Select Market on February 18, 2011, the acceleration date.

Resignation of Officer. On March 11, 2011, Mr. Silvestri, our Executive Vice President and President of Viracon, Inc., resigned and entered into a separation agreement. Pursuant to the separation agreement, Apogee will pay to Mr. Silvestri separation pay in the amount of $360,700, which is equal to 12 months of his most recent annual base salary and payable in 12 equal monthly installments. In addition, Apogee will pay Mr. Silvestri in one lump sum $28,606 for health insurance premium costs and $2,000 for legal fees incurred in reviewing and negotiating the separation agreement, and provide him with outplacement assistance, at a cost of up to a maximum amount of

$20,000. Mr. Silvestri is prohibited under the separation agreement from competing with our Company and soliciting our employees to leave their employment through December 31, 2011.

Section 162(m) Policy

Under Section 162(m) of the U.S. Internal Revenue Code, we must meet specified requirements related to our performance and must obtain shareholder approval of certain compensation arrangements in order for us to fully deduct compensation in excess of $1,000,000 paid to any of our Named Executive Officers, excluding our Chief Financial Officer. Our Executive MIP was approved by our shareholders in 2007 and includes specific performance criteria; therefore, annual incentive awards granted under our Executive MIP are deemed to meet the requirements of Section 162(m) and are not included in the $1,000,000 cap.

Our 1997 Omnibus Stock Incentive Plan, our Amended and Restated 2002 Omnibus Stock Incentive Plan, and our 2009 Stock Incentive Plan have been approved by our shareholders. Therefore, compensation attributable to awards of stock options, stock appreciation rights (“SARs”), Performance Shares and performance share units and certain other awards granted under those plans may be excluded from the $1,000,000 cap under Section 162(m) as well. Additionally, cash compensation voluntarily deferred by our executive officers under our Legacy Deferred Compensation Plan, 2011 Deferred Compensation Plan and Legacy Partnership Plan is not subject to the Section 162(m) cap until the year paid. Compensation paid in fiscal 2011 subject to the Section 162(m) cap is not expected to exceed $1,000,000 for any of our Named Executive Officers other than Mr. Huffer, whose compensation exceeded the $1,000,000 cap by $394,192. As noted above, the compensation paid to Mr. Huffer pursuant to our Executive MIP, Amended and Restated 2002 Omnibus Stock Incentive Plan and 2009 Stock Incentive Plan is expected to be deductible. However, Mr. Huffer exceeded the Section 162(m) $1,000,000 cap in fiscal 2011, primarily due to the vesting of the 2008 – 2010 Performance Shares, which did not meet the requirements of Section 162(m), and vesting of restricted stock under our Legacy Partnership Plan.

The Committee intends to continue its practice of paying competitive compensation consistent with our philosophy to attract, retain and motivate executive officers to manage our business in the best interests of our shareholders. The Committee may choose to provide non-deductible compensation to our executive officers if it deems such compensation to be in the best interests of Apogee and our shareholders.

Compensation Risk Analysis

During fiscal 2011, our Compensation Committee, with the assistance of its independent compensation consultant, assessed risk in our compensation plans, practices and policies and all fiscal 2011 incentive compensation plans. In performing this risk assessment, our Compensation Committee considered the mix of fixed and variable compensation, the mix of short-term and long-term incentive compensation, the extent to which performance metrics are directly reflected in our audited financial statements or other objective reports, the relative weighting of the performance metrics, and the likelihood that achievement of performance metrics could have a material impact on our financial performance in succeeding fiscal periods. In addition, our Compensation Committee considered various compensation risk control mitigation features in our compensation plans, including balanced financial performance metrics, multiple financial performance metrics for our annual cash incentive and long-term equity incentive plans, different financial performance metrics for our annual cash incentive and long-term equity incentive plans, appropriate maximum caps on our annual cash incentive and long-term incentive plans, and management stock ownership guidelines. Our Compensation Committee will annually assess the risk of our compensation programs, policies and practices.

Summary Compensation Table

The following table sets forth the total compensation for services in all capacities for fiscal 2011, 2010 and 2009 awarded to our Named Executive Officers.

Summary Compensation Table


Name and Principal Position	Fiscal Year		Salary ($)⁽¹⁾		Bonus ($)		Stock Awards ($)⁽²⁾			Option Awards ($)⁽³⁾		Non- Equity Incentive Plan Compen- sation ($)⁽⁴⁾		Change in Pension Value and Non-Qualified Deferred Compen- sation Earnings ($)⁽⁵⁾		All Other Compen- sation ($) ⁽⁶⁾		Total ($)
Russell Huffer		2011		700,000		—		1,303,483	⁽⁸⁾		—		—		560,447		66,527		2,630,457
Chief Executive		2010		700,000		—		1,380,879	⁽⁹⁾		—		811,860		828,674		70,580		3,791,993
Officer, President and Former Chairman⁽⁷⁾		2009		693,266		—		699,991	⁽¹⁰⁾		1,233,513		205,240		671,461		80,419		3,583,890
James S. Porter		2011		355,710		—		446,689	⁽⁸⁾		—		—		—		28,122		830,521
Chief Financial Officer		2010		334,750		—		408,133	⁽⁹⁾		—		284,705		—		28,962		1,056,550
Chief Financial Officer		2009		332,875		—		251,070	⁽¹⁰⁾		153,515		65,410		—		37,782		840,652
Gregory A. Silvestri		2011		358,277		—		446,689	⁽⁸⁾		—		—		—		23,682		828,648
Former Executive Vice President and President of Viracon, Inc.⁽¹¹⁾		2010		343,465		—		421,922	⁽⁹⁾		—		139,660		—		20,107		925,154
		2009		349,546		—		262,642	⁽¹⁰⁾		160,604		68,429		—		12,155		853,376

Patricia A. Beithon		2011		283,798		—		354,807	⁽⁸⁾		—		—		30,164		30,781		699,550
General Counsel and Corporate Secretary		2010		277,070		—		337,801	⁽⁹⁾		—		160,673		62,821		32,187		870,552
General Counsel and Corporate Secretary		2009		275,208		—		207,804	⁽¹⁰⁾		129,416		40,618		72,707		39,201		764,954
Gary R. Johnson		2011		197,348		—		111,327	⁽⁸⁾		—		—		—		17,384		326,059
Vice President and Treasurer		2010		192,679		—		105,975	⁽⁹⁾		—		74,480		7,171		16,673		396,978
Vice President and Treasurer		2009		183,245		—		73,169	⁽¹⁰⁾		27,965		17,873		7,110		25,099		334,461

⁽¹⁾

Mr. Huffer did not receive any increase in salary during fiscal 2011 or 2010. Our other Named Executive Officers did not receive any increase in salary during fiscal 2010. Our annual merit increases in salary are generally effective in May, the third month of our fiscal year. For Messrs. Huffer and Porter and Ms. Beithon, the timing of the fiscal 2009 merit increases accounts for the increase in salary reported for fiscal 2010. During fiscal 2009, Mr. Johnson received a merit increase effective in May 2009 and a mid-year salary increase.

⁽²⁾

The amounts shown in this column represent the grant date fair values of the time-based restricted stock and performance share unit awards made in fiscal 2011 and 2010 and the Performance Share awards made in fiscal 2009, in accordance with FASB ASC Topic 718, based on the closing share price of our common stock on the date of grant. See Note 12, (Share-Based Compensation) to our fiscal 2011 Audited Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 26, 2011.

⁽³⁾

The amounts shown in this column represent the grant date fair values of SARs granted and “reload” options issued upon exercise of options with a reload feature during fiscal 2009. In accordance with FASB ASC Topic 718, the grant date fair values for these awards have been determined using the Black-Scholes method and based on the assumptions set forth in Note 12 (Share-Based Compensation) to our fiscal 2011 Audited Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 26, 2011, except that the assumption related to forfeiture is not included in the calculations for these purposes.

⁽⁴⁾

The amounts in this column represent the annual cash incentive awards to our Named Executive Officers pursuant to our Executive MIP for fiscal 2011 and 2010 and our Executive MIP or individual annual cash incentive plans for fiscal 2009. Our Executive MIP is discussed under the heading “Annual Cash Incentive Compensation” on page 33, and the awards made thereunder are discussed under the heading “Fiscal 2011 Annual Cash Incentive Compensation” on page 37 and “Grants of Plan-Based Awards” on page 48.

⁽⁵⁾	The following table shows each component of the “Change in Pension Value and Non-Qualified Deferred Compensation Earnings ($)” column for each of our Named Executive Officers for fiscal 2011, 2010 and 2009.


Name	Fiscal Year		Change in Pension Value		Above Market Earnings on Amounts Deferred Pursuant to Our Legacy Deferred Compensation Plan
Russell Huffer		2011		560,447		—
		2010		814,169		14,505
		2009		661,129		10,332
James S. Porter		2011		—		—
		2010		—		—
		2009		—		—
Gregory A. Silvestri		2011		—		—
		2010		—		—
		2009		—		—
Patricia A. Beithon		2011		30,164		—
		2010		61,250		1,571
		2009		72,707		—
Gary R. Johnson		2011		—		—
		2010		—		7,171
		2009		—		7,110

⁽⁶⁾	The following table shows each component of the “All Other Compensation” column for each of our Named Executive Officers for fiscal 2011.

All Other Compensation Table


Name	Perquisites ($)^(a)		Company Contributions to Defined Contribution Plans ($)^(b)		Dividends or Earnings on Stock Awards ($)^(c)		Total All Other Compensation ($)
Russell Huffer		3,140		20,260		43,127		66,527
James S. Porter		965		14,348		12,809		28,122
Gregory A. Silvestri		1,140		11,332		11,210		23,682
Patricia A. Beithon		1,077		17,353		12,351		30,781
Gary R. Johnson		749		12,801		3,834		17,384

^(a)

This column reports, for Mr. Huffer, reimbursement of financial and estate planning fees of $2,000 and annual long-term disability insurance premiums for enhanced long-term disability insurance of $1,140 and only annual long-term disability insurance premiums for enhanced long-term disability insurance for our other Named Executive Officers.

^(b)

This column reports the amounts we set aside or accrued during fiscal 2011 under our 401(k) Retirement Plan as an annual retirement plan contribution and as matching contributions on our Named Executive Officers’ contributions to such plan, and under our employee stock purchase plan as a 15% matching contribution on our Named Executive Officers’ contributions to such plan. Such contribution amounts are set forth in the table below. Our Named Executive Officers are eligible to participate in our 401(k) retirement plan and employee stock purchase plan on the same basis as all eligible employees.


Name	401(k) Retirement Plan Annual Retirement Contribution ($)		401(k) Retirement Plan Matching Contributions ($)		Employee Stock Purchase Plan 15% Matching Contribution ($)
Russell Huffer		12,250		4,410		3,600
James S. Porter		9,800		2,988		1,560
Gregory A. Silvestri		7,350		3,982		—
Patricia A. Beithon		9,800		4,433		3,120
Gary R. Johnson		7,858		4,268		675

^(c)

This column represents dividends paid on unvested restricted stock, unvested Pool B Shares issued under our Legacy Partnership Plan and unearned Performance Shares issued at target level (a practice we eliminated relative to awards of performance share units made after fiscal 2009). For each Named Executive Officer, the dividends paid on unearned Performance Shares, unvested shares of restricted stock and unvested Pool B Shares during fiscal 2011, are listed below.


Name	Dividends Paid On
Name	Performance Shares ($)		Restricted Stock ($)		Pool B Shares ($)
Russell Huffer		10,570		24,966		7,591
James S. Porter		3,791		7,201		1,817
Gregory A. Silvestri		3,966		7,244		—
Patricia A. Beithon		3,137		5,829		3,385
Gary R. Johnson		1,105		1,788		941

⁽⁷⁾	Mr. Huffer served as Chairman of the Board from 1999 through January 2011, when our Board elected a Non-Executive Chair of the Board.

⁽⁸⁾

The amounts include the grant date fair market value of the target payout amounts for the fiscal 2011 - 2013 performance share unit awards as follows: Mr. Huffer, $714,004; Mr. Porter, $259,699; Mr. Silvestri, $259,699; Ms. Beithon, $205,486; and Mr. Johnson, $65,487. The grant date fair market value of the maximum potential payout amounts for the performance share unit awards were as follows: Mr. Huffer, $1,428,007; Mr. Porter, $519,399; Mr. Silvestri, $519,399; Ms. Beithon, $410,972; and Mr. Johnson, $130,974. Further information regarding the fiscal 2011 awards is included in the “Fiscal 2011 Grants of Plan-Based Awards” and “Outstanding Equity Awards at 2011 Fiscal Year-End” tables on pages 48 and 49, respectively.

⁽⁹⁾

The amounts include the grant date fair market value of the target payout amounts for the fiscal 2010 - 2012 performance share unit awards as follows: Mr. Huffer, $714,000; Mr. Porter, $241,020; Mr. Silvestri, $252,148; Ms. Beithon, $199,490; and Mr. Johnson, $63,585. The grant date fair market value of the maximum potential payout amounts for the performance share unit awards were as follows: Mr. Huffer, $1,428,000; Mr. Porter, $482,039; Mr. Silvestri, $504,296; Ms. Beithon, $398,980; and Mr. Johnson, $127,169. Further information regarding the fiscal 2010 awards is included in the “Outstanding Equity Awards at 2011 Fiscal Year-End” table on page 49.

⁽¹⁰⁾

The amounts shown represent the grant date fair market value of the target payout amounts for the Fiscal 2009 – 2011 Performance Share awards. The grant date fair market value of the maximum potential payout amounts for the Performance Share awards were as follows: Mr. Huffer, $1,399,982; Mr. Porter, $502,140; Mr. Silvestri, $525,285; Ms. Beithon, $415,608; and Mr. Johnson, $146,337. Further information regarding the fiscal 2009 awards is included in the “Outstanding Equity Awards at 2011 Fiscal Year-End” table on page 49.

⁽¹¹⁾	Mr. Silvestri resigned from our Company effective as of March 11, 2011.

Grants of Plan-Based Awards

The following table sets forth information concerning estimated possible payouts under our Executive MIP for fiscal 2011, estimated future payouts of performance share unit awards, and time-based restricted stock awards made to our Named Executive Officers during fiscal 2011. Each of the equity awards listed in the following table was made under our 2009 Stock Incentive Plan.

Fiscal 2011 Grants of Plan-Based Awards


Name	Grant Date		Estimated Possible Payouts Under Non-Equity Incentive Plan Awards⁽¹⁾						Estimated Future Payouts Under Equity Incentive Plan Awards⁽²⁾						All Other Stock Awards: Number of Shares of Stock or Units (#)⁽³⁾		Grant Date Fair Value of Stock and Option Awards ($)⁽⁴⁾
Name	Grant Date		Threshold ($)		Target ($)		Maximum ($)		Threshold (#)		Target (#)		Maximum (#)				Grant Date Fair Value of Stock and Option Awards ($)⁽⁴⁾
Russell Huffer		—		86,660		525,000		1,050,000		—		—		—		—		—
		4/27/2010		—		—		—		26,347		52,694		105,388		—		714,004
		4/27/2010		—		—		—		—		—		—		43,504		589,479
James S. Porter		—		35,709		216,420		432,840		—		—		—		—		—
		4/27/2010		—		—		—		9,583		19,166		38,332		—		259,699
		4/27/2010		—		—		—		—		—		—		13,800		186,990
Gregory A. Silvestri		—		19,839		198,385		396,770		—		—		—		—		—
		4/27/2010		—		—		—		9,583		19,166		38,332		—		259,699
		4/27/2010		—		—		—		—		—		—		13,800		186,990
Patricia A. Beithon		—		23,546		142,700		285,400		—		—		—		—		—
		4/27/2010		—		—		—		7,583		15,165		30,330		—		205,486
		4/27/2010		—		—		—		—		—		—		11,020		149,321
Gary R. Johnson		—		8,196		49,615		99,230		—		—		—		—		—
		4/27/2010		—		—		—		2,417		4,833		9,666		—		65,487
		4/27/2010		—		—		—		—		—		—		3,383		45,840

⁽¹⁾

These columns show the range of possible payouts under the annual cash incentive awards granted on April 27, 2010 based on results achieved against financial performance metrics for fiscal 2011. The annual cash incentive awards for all our Named Executive Officers were made pursuant to our Executive MIP described under the heading “Annual Cash Incentive Compensation” on page 33. Amounts shown in the “Threshold” column assume threshold performance level is achieved for only the financial performance goal with the lowest weighting and is not achieved for any other financial performance goals. Amounts shown in the “Target” and “Maximum” columns assume target and maximum performance levels, respectively, are achieved for all financial performance goals. Final award determinations were made during fiscal 2012. There were no annual cash incentive award payments for fiscal 2011, as described under the heading “Fiscal 2011 Annual Cash Incentive Compensation” on page 37 and shown in the “Summary Compensation Table” on page 45 in the column titled “Non-Equity Incentive Plan Compensation ($).”

⁽²⁾

These columns show the threshold, target and maximum level of shares to be earned under our performance share unit award program for the three-year performance period beginning on the first day of fiscal 2011 and ending on the last day of fiscal 2013. The level of shares to be earned is based upon Apogee’s average return on invested capital, cumulative earnings per share and market share growth. Dividends or other distributions (whether cash, stock or otherwise) with respect to the performance share units will accrue during the three-year performance period and will be paid only on shares earned at the end of the performance period when such shares are issued. In the event of retirement, early retirement, total disability or death prior to the end of the performance period, the performance share units earned based on the financial performance goals will be distributed at the end of the performance period to the participant, or in the event of death, to his or her estate. The performance share unit award program is described under the heading “Performance Share Units” on page 34.

⁽³⁾

These time-based restricted stock awards were awarded on April 27, 2010 based on performance during fiscal 2010. The shares of restricted stock vest in equal annual installments on the first three anniversaries of the grant date. Dividends or other distributions (whether cash, stock or otherwise) with respect to the shares of restricted stock will be paid during the vesting period. In the event of total disability or death prior to the end of the vesting period, the shares of time-based restricted stock will be distributed at the end of the vesting period to the participant, or in the event of death, to his or her estate. Our time-based restricted stock program is described under “Time-Based Restricted Stock” on page 34.

⁽⁴⁾

The fair value of the performance share unit awards and time-based restricted stock awards is calculated by multiplying the number of performance share units at target level or shares of restricted stock, as applicable, by $13.55, the closing price of our common stock on the NASDAQ Global Select Market on April 27, 2010, the date of grant.

Outstanding Equity Awards at Fiscal Year-End

The following table summarizes the equity awards held by our Named Executive Officers as of February 26, 2011, the last day of fiscal 2011.

Outstanding Equity Awards at 2011 Fiscal Year-End


	Option Awards											Stock Awards
Name	Option Grant Date			Number of Securities Under- lying Unexer- cised Options (#) Exercisable		Number of Securities Under- lying Unexer- cised Options (#) Unexercisable		Option Exercise Price ($)⁽¹⁾		Option Expiration Date		Number of Shares or Units of Stock That Have Not Vested (#)			Market Value of Shares or Units of Stock That Have Not Vested ($)⁽²⁾		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)⁽³⁾			Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)⁽²⁾
Russell Huffer		4/10/2002	⁽⁴⁾		8,010		—		12.8400		4/10/2012		—			—		—			—
Russell Huffer		4/14/2004	⁽⁴⁾		8,640		—		11.8600		4/14/2014		—			—		—			—
		4/13/2005	⁽⁵⁾		71,186		—		14.1000		4/13/2015		—			—		—			—
		4/25/2006	⁽⁵⁾		81,753		—		15.7700		4/25/2016		—			—		—			—
		4/16/2007	⁽⁶⁾		54,159		—		24.0600		6/18/2012		—			—		—			—
		5/01/2007	⁽⁵⁾		76,204		—		24.1900		5/01/2017		—			—		—			—
		4/29/2008	⁽⁵⁾		54,037		27,018		21.5900		4/29/2018		—			—		—			—
		4/30/2008	⁽⁶⁾		26,725		—		22.3100		4/10/2013		—			—		—			—
		4/30/2008	⁽⁶⁾		52,599		—		22.3100		4/14/2014		—			—		—			—
		—			—		—		—		—		—			—		32,422	⁽⁷⁾		451,314
		—			—		—		—		—		—			—		53,125	⁽⁸⁾		739,500
		—			—		—		—		—		—			—		52,694	⁽⁹⁾		733,500
		—			—		—		—		—		33,079	⁽¹⁰⁾		460,460		—			—
		—			—		—		—		—		43,504	⁽¹¹⁾		605,576		—			—
James S. Porter		4/10/2002	⁽⁴⁾		6,000		—		12.8400		4/10/2012		—			—		—			—
James S. Porter		4/10/2003	⁽⁴⁾		4,500		—		9.1500		4/10/2013		—			—		—			—
		4/14/2004	⁽⁴⁾		6,600		—		11.8600		4/14/2014		—			—		—			—
		4/13/2005	⁽⁵⁾		5,101		—		14.1000		4/13/2015		—			—		—			—
		4/25/2006	⁽⁵⁾		19,378		—		15.7700		4/25/2016		—			—		—			—
		5/01/2007	⁽⁵⁾		18,058		—		24.1900		5/01/2017		—			—		—			—
		4/29/2008	⁽⁵⁾		13,526		6,763		21.5900		4/29/2018		—			—		—			—
		—			—		—		—		—		—			—		11,629	⁽⁷⁾		161,876
		—			—		—		—		—		—			—		17,933	⁽⁸⁾		249,627
		—			—		—		—		—		—			—		19,166	⁽⁹⁾		266,791
		—			—		—		—		—		8,289	⁽¹⁰⁾		115,383		—			—
		—			—		—		—		—		13,800	⁽¹¹⁾		192,096		—			—


	Option Awards											Stock Awards
Name	Option Grant Date			Number of Securities Under- lying Unexer- cised Options (#) Exercisable		Number of Securities Under- lying Unexer- cised Options (#) Unexercisable		Option Exercise Price ($)⁽¹⁾		Option Expiration Date		Number of Shares or Units of Stock That Have Not Vested (#)			Market Value of Shares or Units of Stock That Have Not Vested ($)⁽²⁾		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)⁽³⁾			Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)⁽²⁾
Gregory A. Silvestri		4/29/2008	⁽⁵⁾		14,151		7,075		21.5900		4/29/2018		—			—		—			—
Gregory A. Silvestri		—			—		—		—		—		—			—		12,165	⁽⁷⁾		169,337
		—			—		—		—		—		—			—		18,761	⁽⁸⁾		261,153
		—			—		—		—		—		—			—		19,166	⁽⁹⁾		266,791
		—			—		—		—		—		8,421	⁽¹⁰⁾		117,220		—			—
		—			—		—		—		—		13,800	⁽¹¹⁾		192,096		—			—
Patricia A. Beithon		4/10/2002	⁽⁴⁾		19,447		—		12.8400		4/10/2012		—			—		—			—
Patricia A. Beithon		4/10/2003	⁽⁴⁾		9,916		—		9.1500		4/10/2013		—			—		—			—
		4/14/2004	⁽⁴⁾		22,000		—		11.8600		4/14/2014		—			—		—			—
		4/13/2005	⁽⁵⁾		17,411		—		14.1000		4/13/2015		—			—		—			—
		4/25/2006	⁽⁵⁾		16,939		—		15.7700		4/25/2016		—			—		—			—
		5/01/2007	⁽⁵⁾		14,946		—		24.1900		5/01/2017		—			—		—			—
		7/02/2007	⁽⁶⁾		3,176		—		28.7400		4/10/2013		—			—		—			—
		7/02/2007	⁽⁶⁾		389		—		28.7400		6/18/2012		—			—		—			—
		4/29/2008	⁽⁵⁾		11,403		5,701		21.5900		4/29/2018		—			—		—			—
		—			—		—		—		—		—			—		9,625	⁽⁷⁾		133,980
		—			—		—		—		—		—			—		14,843	⁽⁸⁾		206,615
		—			—		—		—		—		—			—		15,165	⁽⁹⁾		211,097
		—			—		—		—		—		6,860	⁽¹⁰⁾		95,491		—			—
		—			—		—		—		—		11,020	⁽¹¹⁾		153,398		—			—
Gary R. Johnson		4/10/2002	⁽⁴⁾		4,000		—		12.8400		4/10/2012		—			—		—			—
Gary R. Johnson		4/10/2003	⁽⁴⁾		3,000		—		9.1500		4/10/2013		—			—		—			—
		4/14/2004	⁽⁴⁾		4,000		—		11.8600		4/14/2014		—			—		—			—
		4/13/2005	⁽⁵⁾		3,996		—		14.1000		4/13/2015		—			—		—			—
		4/25/2006	⁽⁵⁾		3,605		—		15.7700		4/25/2016		—			—		—			—
		5/01/2007	⁽⁵⁾		3,169		—		24.1900		5/01/2017		—			—		—			—
		4/29/2008	⁽⁵⁾		2,464		1,232		21.5900		4/29/2018		—			—		—			—
		—			—		—		—		—		—			—		3,389	⁽⁷⁾		47,175
		—			—		—		—		—		—			—		4,731	⁽⁸⁾		65,856
		—			—		—		— &n