RELIANCE STEEL & ALUMINUM CO.

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

To Be Held May 19, 2010

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

To the Shareholders of
Reliance Steel & Aluminum Co.:

     This Notice presents only an overview of the more complete proxy materials that are available to you on the Internet, if you have not received this by mail. We encourage you to access and review all of the important information contained in the proxy materials before voting. A Proxy Statement, an Annual Report to Shareholders, an Annual Report on Form 10-K and a proxy form for voting are available online at www.proxyvote.com by using the 12-digit control number provided to you. If you want to receive a paper or e-mail copy of these documents, you must request one. There is no charge for the copy. Please request a copy (1) by Internet at www.proxyvote.com; (2) by telephone at 1-800-579-1639; or (3) by email to sendmaterial@proxyvote.com, on or before May 5, 2010 to facilitate timely delivery.

     NOTICE IS HEREBY GIVEN that the Annual Meeting of the shareholders of Reliance Steel & Aluminum Co. (“Reliance” or “Company”) will be held on Wednesday, May 19, 2010, at 10:00 a.m., California time, at The Omni Hotel, 251 South Olive Street, Los Angeles, California 90012, for the following purposes:

	1.		To elect four directors to serve for two years and until their successors have been duly elected and qualified. The nominees for election to the Board are David H. Hannah, Mark V. Kaminski, Gregg J. Mollins, and Andrew G. Sharkey, III. The Board of Directors recommends that shareholders vote FOR the election of each nominee as a director.
	2.		To consider a shareholder proposal to elect each director annually. The Board of Directors recommends that shareholders vote AGAINST this proposal to elect each director annually.
	3.		To ratify KPMG LLP as our independent registered public accounting firm to perform the annual audit of our 2010 financial statements. The Board of Directors recommends that shareholders vote FOR the ratification of KPMG LLP as our independent registered public accounting firm.
	4.		To transact such other business as may properly come before the Annual Meeting or adjournments thereof.

     This is an invitation to attend the Annual Meeting and to vote on the matters to be considered. Only holders of shares of record on the books of Reliance at the close of business on April 1, 2010 are entitled to notice of, and to vote at, the Annual Meeting or any adjournments thereof. You may continue to trade in our common stock during the solicitation period.

     All shareholders are invited to attend the Annual Meeting. To make it easier, you may vote on the Internet or by telephone. The instructions attached to this Notice describe how to use these convenient services. Even if you give your proxy, you have the right to vote in person if you attend the Annual Meeting.

		By Order of the Board of Directors,
Los Angeles, California		Kay Rustand
April 2, 2010		Corporate Secretary

RELIANCE STEEL & ALUMINUM CO.
350 South Grand Avenue
Suite 5100
Los Angeles, California 90071

PROXY STATEMENT

FOR ANNUAL MEETING OF SHAREHOLDERS

To Be Held May 19, 2010

     We are furnishing this statement because the Board of Directors of Reliance Steel & Aluminum Co. is soliciting proxies for use at the Annual Meeting of Reliance shareholders to be held at The Omni Hotel, 251 South Olive Street, Los Angeles, California 90012, on Wednesday, May 19, 2010 at 10:00 a.m., California time, or at any adjournments thereof, for the purposes set forth in the accompanying Notice of Annual Meeting.

INFORMATION CONCERNING PROXY

     The Board of Directors selected Douglas M. Hayes and Franklin R. Johnson, both independent directors, to be named as proxyholders to vote the shares of common stock represented by the proxies at the Annual Meeting. Reliance will pay the cost to solicit the proxies. The Board of Directors will solicit proxies by mail, by telephone, and electronically via the Internet. In addition, certain of our officers and agents may solicit proxies by telephone, telegraph, and personal interview (the cost of which will be nominal). We expect that banks, brokerage houses and other custodians, nominees and fiduciaries will forward soliciting material to beneficial owners and obtain authorizations to execute proxies. We will reimburse the out-of-pocket expenses they incur to forward the proxy materials. Effective January 1, 2010, your bank, broker or financial institution will not be able to vote on your behalf for the election of directors unless you provide specific instructions by completing and returning a proxy or voting instruction form or following instructions provided to you to vote your shares via telephone or the Internet. Voting your shares is important to ensure that you have a say in the governance of our Company.

     We intend only the following matters to be presented at the Annual Meeting: (1) the election of four directors to serve for the ensuing two years and until their successors are duly elected and qualified, (2) a shareholder proposal to elect each director annually and (3) the ratification of KPMG LLP as our independent registered public accounting firm to perform the annual audit of our 2010 financial statements. Unless you instruct us otherwise on the proxy, each proxy will be voted FOR the election of all of the four nominees named herein as directors, AGAINST the shareholder proposal to elect each director annually and FOR the ratification of KPMG LLP as our independent registered public accounting firm for 2010. If other matters properly come before the meeting, including but not limited to, any matter for which we did not receive notice by December 10, 2009, each proxy will be voted by the named proxyholders in their discretion in a manner that they consider to be in our best interests.

     If you execute a proxy or submit a proxy via the Internet or telephone, the proxy may be revoked at any time before it is voted (i) by filing with the Corporate Secretary of Reliance either an instrument revoking the proxy or a proxy bearing a later date, duly executed, or (ii) by giving written notice to the Corporate Secretary of Reliance of the death or incapacity of the shareholder who executed the proxy. Any such notice should be sent or delivered to the above address. In addition, the powers of a proxyholder are suspended if the person executing the proxy is present at the Annual Meeting and elects to vote in person.

     We intend to make this Proxy Statement and accompanying material available to each shareholder on the Internet beginning on or about April 2, 2010. An Annual Report, including a letter to the shareholders from the Chairman and Chief Executive Officer, the President and Chief Operating Officer and the Executive Vice President and Chief Financial Officer, and an Annual Report on Form 10-K will also be available electronically. Some shareholders will receive these materials by mail and other shareholders may request copies of these materials at no cost. The Annual Reports and letter are not incorporated in, and are not a part of, this Proxy Statement and do not constitute proxy-soliciting material.

INFORMATION CONCERNING RELIANCE’S SECURITIES

     Our only voting securities are shares of common stock, no par value. As of January 31, 2010, we had a total of 73,810,882 shares issued and outstanding, all of which may be voted at the Annual Meeting. Only holders of shares of record on our books at the close of business on April 1, 2010 will be entitled to vote at the Annual Meeting.

     In the election of directors, you as a shareholder are entitled to cumulate your votes for candidates whose names have been placed in nomination prior to the voting, if you give notice at the Annual Meeting before the voting of your intention to cumulate votes. Cumulative voting entitles every shareholder who is otherwise entitled to vote at an election of directors to cumulate their votes, that is, to give any one candidate a number of votes equal to the number of directors to be elected, multiplied by the number of votes to which the shareholder’s shares are normally entitled, or to distribute those cumulated votes on the same principle among as many candidates as a shareholder determines appropriate. If any shareholder gives notice of the intention to cumulate votes, all shareholders may cumulate their votes for candidates. On all matters other than the election of directors, each share has one vote.

     A plurality of the aggregate number of votes represented by the shares present at the Annual Meeting in person or by proxy must vote to elect directors. That means that the four individuals receiving the largest number of votes cast will be elected as directors, whether or not they receive a majority of the votes cast. The affirmative vote of a majority of the votes cast is required to approve the shareholder proposal to elect each director annually. The affirmative vote of a majority of the votes cast is required to ratify the engagement of KPMG LLP as our independent registered public accounting firm.

ELECTION OF DIRECTORS

     Our Bylaws divide the Board of Directors into two classes, which are to be as nearly equal in number as possible, and require one class to be elected each year to serve for a two-year term. The terms of four of the incumbent directors expire as of the date of the Annual Meeting. The Nominating and Governance Committee and the Board of Directors have nominated the following persons to be nominees for election at the Annual Meeting as directors: David H. Hannah, Mark V. Kaminski, Gregg J. Mollins, and Andrew G. Sharkey, III. These nominees have agreed to serve as directors. The term of office for each director elected at the Annual Meeting will be two years, until the second following Annual Meeting of Shareholders and until their successors are duly elected and qualified. The Board of Directors believes that the classified board structure, which has been in place at Reliance since its initial public offering in 1994, provides stability and continuity and thereby fosters effective long-term strategic planning; enhances the independence of the directors; and assists the Company in attracting director candidates. Since the Board is classified into only two classes, rather than three classes as permitted by the New York Stock Exchange rules, shareholders have the opportunity to vote for half of the directors each year.

     Unless you otherwise instruct the proxyholders in the proxy, your proxy will be voted FOR the above-named nominees. Effective January 1, 2010, your broker will not be able to vote on your behalf for the election of directors unless you provide specific instructions by completing and returning a proxy or voting instruction form or following instructions provided to you to vote your shares via telephone or the Internet. In voting the proxies for election of directors, the proxyholders have the right to cumulate the votes for directors covered by the proxies (unless otherwise instructed) and may do so if they think that is desirable and announce it in advance of the voting at the Annual Meeting.

     All of the nominees for the position of director expiring in 2012 were elected to their present term of office by vote of the shareholders at the Annual Meeting of Shareholders held in May 2008. Although we do not expect that any nominee will decline or be unable to serve as a director, if any nominee declines or is unable to serve, the proxies will be voted, at the Annual Meeting or any adjournment thereof, for such other person as the Board of Directors may select or, if no other person is so selected, as the proxyholders may, in their discretion, select; provided that the proxyholders will not vote for more than four nominees.

     Certain information with respect to each nominee is set forth in “Management” below. Under the leadership of this Board of Directors, excluding dividends, the value of Reliance stock has increased over three years by 9.8%, over five years by 121.9% and over ten years by 268.8%. The Board of Directors recommends that shareholders vote FOR the election of each nominee as a director. Unless otherwise indicated on your proxy, the proxyholders will vote your proxy FOR the election of all named nominees.

PROPOSAL 2 — SHAREHOLDER PROPOSAL

     The following proposal was submitted by John Chevedden, 2215 Nelson Avenue, Number 205, Redondo Beach, California 90278, who has represented to us that he has held for at least one year and currently holds not less than 200 shares of Reliance common stock. We are not responsible for the content of this proposal, which is set forth below exactly as it was provided to us. We understand that he intends to raise this shareholder proposal at the next annual meeting of shareholders. The Board of Directors recommends a vote AGAINST this proposal.

“[RS: Rule 14a-8 Proposal, December 3, 2009]
“2 — Elect Each Director Annually

“RESOLVED, shareholders ask that our Company take the steps necessary to reorganize the Board of Directors into one class with each director subject to election each year and to complete this transition within one-year.

“Our current practice, in which only a few directors stand for election annually, is not in the best interest of our Company and its stockholders. Eliminating this staggered system would give stockholders an opportunity to register their view on the performance of each director annually. Electing directors in this manner is one of the best methods available to stockholders to ensure that our Company will be managed in a manner that is in the best interest of shareholders.

“Arthur Levitt, former Chairman of the Securities and Exchange Commission said, “In my view it’s best for the investor if the entire board is elected once a year. Without annual election of each director shareholders have far less control over who represents them.’’

“The merit of this Elect Each Director Annually proposal should also be considered in the context of the need for improvement in our company’s 2009 reported corporate governance status:

“The Corporate Library www.thecorporatelibrary.com, an independent research firm, rated our company “Moderate Concern” in Executive Pay. Our CEO David Hannah’s bonus was based on a plan that paid a bonus of 100% of base salary if the rate of return was 12%. The Corporate Library found this target to be unchallenging considering that our company’s average return on beginning shareholder’s equity since 1978 was 13.7%. This meant that the plan paid 100% of base salary for performance that was below average.

“The large increase in pension value for Mr. Hannah raised red flags according to The Corporate Library. This amount was more than 90% of the total of his base salary and bonus combined. Such high levels of executive pay that were not related to performance raised concerns about the ability of our executive pay committee to ensure that the executive pay process was sufficiently performance-related.

“Our company’s granting of stock options may weaken the link between executive pay and company performance since a small increase in our company’s share price can result in a large increase in value of the awards.

“Douglas Hayes, our Lead Director, and Leslie Waite each received a dismal 27% in withheld votes from us. Directors Hayes and Waite represented 50% of our audit and executive pay committees and had 12 and 32-years long-tenure (independence concerns).

“Our board was the only significant directorship for 75% of our directors. This could indicate a significant lack of current transferable director experience for the vast majority of our directors. Plus our directors can be reelected with only one vote from our 73 million shares.

“The above concerns show there is need for improvement. Please encourage our board to respond positively to this proposal: Elect Each Director Annually — Yes on 2.”

Board of Directors’ Response To The Proposal

     The Board of Directors opposes proposal #2 and recommends that you vote AGAINST it for the following reasons.

     After thoughtful consideration, the Board of Directors, following the recommendation of the Nominating and Governance Committee, has determined that proposal 2 is not in the best interests of Reliance or its shareholders and, accordingly, recommends a vote against it.

     The Board of Directors believes that the classified board structure, which has been in place at Reliance since its initial public offering in 1994, provides stability and continuity and thereby fosters effective long-term strategic planning. Staggered elections also ensure that, at any given time, experienced directors who are familiar with Reliance and its business, management, strategic goals and challenges serve on the Board of Directors. The proposed annual election of directors could leave the Company vulnerable to the possibility of having a board consisting of directors with no prior experience with or substantial knowledge of the Company. A classified board also benefits Reliance and its shareholders because it helps attract and retain director candidates who are willing to make long-term commitments of their time and energy. In addition, electing directors to two-year terms, rather than one-year terms, enhances the independence of non-management directors. This longer term provides a certain amount of independence from special interest groups and others who may have an agenda contrary to the long-term interests of all shareholders. As a result, the accountability for independent directors will be more closely linked to the long-term implications of their decisions rather than short-term results.

     Directors elected to two-year terms are equally accountable to shareholders as directors elected annually, since all directors are required to uphold their fiduciary duties to Reliance and its shareholders regardless of term. Shareholders have the right to remove a director every two years if they are not satisfied with the director’s service. Since the Board is classified into only two classes, rather than three classes as permitted by the New York Stock Exchange rules, shareholders have the opportunity to remove half of the directors each year. This process ensures that the Board of Directors remains accountable to the views and concerns of Reliance’s shareholders, while enabling it to focus on long-term goals and strategies.

     The Board of Directors believes that a classified board plays an important role in ensuring that the interests of all shareholders are protected and maximized in connection with an unsolicited takeover proposal. The classified board structure is designed to safeguard against a hostile purchaser gaining control of Reliance and its assets without paying fair market value for them by removing our directors at a single annual meeting. A classified board provides the incumbent directors at least two annual shareholder meetings to negotiate the best results for our shareholders without a change in control of the Board of Directors in any one year. A classified board does not preclude a takeover but, by removing the threat of imminent removal, provides a company with time and leverage to evaluate the adequacy and fairness of any takeover proposal, negotiate on behalf of all shareholders and weigh alternative methods of maximizing shareholder value for all shareholders.

     It is important to note that shareholder approval of this proposal would not in itself declassify the Board of Directors. Approval of this proposal would advise the Board of Directors that a majority of the Company’s shareholders voting at the meeting favor a change and would prefer that the Board take the necessary steps to end the staggered system of electing directors. However, to change the class structure of the Board of Directors, the Board must first approve amendments to Reliance’s Articles of Incorporation and Bylaws. At a subsequent shareholder meeting, shareholders would then be required to approve each of those amendments with an affirmative vote of not less than a majority of the total voting power of all outstanding shares of Reliance stock entitled to vote generally in the election of directors. Any director then serving a two-year term would be entitled to complete that term before standing for election again.

     After careful consideration of proposal 2, the Nominating and Governance Committee and the entire Board of Directors have determined that retention of a classified board structure remains in the best interests of Reliance and its shareholders. The Board of Directors believes that the benefits of a classified board structure do not come at the expense of director accountability. Moreover, the various corporate governance measures implemented by the Board of Directors, validates the Board’s commitment to Reliance and its shareholders.

     The Board of Directors unanimously recommends a vote AGAINST proposal #2. Unless otherwise indicated on your proxy, the proxyholders will vote your proxy AGAINST proposal #2.

MANAGEMENT

Directors and Executive Officers

     The following table sets forth certain information regarding our directors and executive officers:

Name		Age				Position with Reliance
David H. Hannah(1)			58			Chairman and Chief Executive Officer; Director
Gregg J. Mollins(1)			55			President; Chief Operating Officer; Director
Karla R. Lewis			44			Executive Vice President; Chief Financial Officer
James D. Hoffman			51			Senior Vice President, Operations
James P. MacBeth			62			Senior Vice President, Carbon Steel Operations
William K. Sales, Jr.			52			Senior Vice President, Non-Ferrous Operations
Thomas W. Gimbel(2) (5)			58			Director
Douglas M. Hayes(2) (3) (4)			66			Director
Franklin R. Johnson(2) (3) (5)			73			Director
Mark V. Kaminski(1) (3) (4) (5)			54			Director
Andrew G. Sharkey, III(1) (4) (5)			63			Director
Leslie A. Waite(2) (3) (4)			64			Director

   Nominees for Directors to be Elected in 2010 With Terms Ending in 2012

     David H. Hannah was appointed a director of Reliance in 1992 and became the Chairman of the Board of Reliance in October 2007 and the Chief Executive Officer of Reliance in January 1999. Mr. Hannah served as President of Reliance from November 1995 to January 2002. Prior to that, he was Executive Vice President and Chief Financial Officer from 1992 to 1995, Vice President and Chief Financial Officer from 1990 to 1992 and Vice President and Division Manager of the Los Angeles Reliance Steel Company division of Reliance from 1989 to 1990. Mr. Hannah has served as an officer of the Company since 1981. For eight years before joining Reliance in 1981, Mr. Hannah, a certified public accountant, was employed in various professional staff positions by Ernst & Whinney (a predecessor to Ernst & Young LLP, which was our independent registered public accounting firm through 2007).

     Mark V. Kaminski was appointed a director of Reliance in November 2004. Mr. Kaminski was chief executive officer and a director of Commonwealth Industries Inc. (now Aleris International, Inc.) from 1991 to June 2004, when he retired. Mr. Kaminski had served in other capacities with Commonwealth Industries Inc. since 1987. Aleris is a supplier of metals to Reliance, but our purchases in any year do not exceed five percent of either the gross revenues or the total consolidated assets of Reliance or of Aleris. Mr. Kaminski is also a director of the Matthew Kelly Foundation, Cincinnati, Ohio, a non-profit organization. Mr. Kaminski serves as a member and Chairman of our Nominating and Governance Committee and as a member of our Compensation and Stock Option Committee and our Audit Committee. Mr. Kaminski also serves as a director and on the audit and compensation committees of Granite Rock, a

privately-held company. The Board of Directors has determined that Mr. Kaminski is an independent director.

     Gregg J. Mollins was appointed a director of Reliance in September 1997 and became President of Reliance in January 2002. Mr. Mollins has served as Chief Operating Officer since May 1994. Mr. Mollins was Executive Vice President from November 1995 to January 2002, was Vice President and Chief Operating Officer from 1994 to 1995 and was Vice President from 1992 to 1994. Prior to that time he had been with Reliance for six years as Division Manager of the former Santa Clara division. For ten years before joining Reliance in 1986, Mr. Mollins was employed by certain of our competitors in various sales and sales management positions.

     Andrew G. Sharkey, III was appointed a director of Reliance in July 2007. Mr. Sharkey served as president and chief executive officer of the American Iron and Steel Institute from 1993 until his retirement in September 2008, and from 1978 to 1993 Mr. Sharkey was president, executive vice president and director of education for the Steel Service Center Institute (currently the Metal Service Center Institute). Mr. Sharkey serves as a member of our Nominating and Governance Committee and our Compensation and Stock Option Committee. Mr. Sharkey also serves as a director and a member of the compensation committee of General Moly, Inc., a public company with securities listed on the NYSE Alternext (formerly the American Stock Exchange). The Board of Directors has determined that Mr. Sharkey is an independent director.

     Directors Whose Terms Continue Until 2011

     Thomas W. Gimbel was appointed a director of Reliance in January 1999. Mr. Gimbel has been retired since 2006 and currently serves as Trustee of the Florence Neilan Trust, which was one of Reliance’s largest shareholders. Between 1984 and 2006, Mr. Gimbel was the President of Advanced Systems Group, an independent computer consulting firm servicing database requirements for diverse businesses of various sizes. From 1975 to 1984, Mr. Gimbel was employed by Dun & Bradstreet. Mr. Gimbel serves as a member of our Nominating and Governance Committee. The Board of Directors has determined that Mr. Gimbel is an independent director.

     Douglas M. Hayes became a director of Reliance in September 1997. Mr. Hayes retired from Donaldson, Lufkin & Jenrette Securities Corporation (“DLJ”), where he was Managing Director of Investment Banking from 1986 to May 1997, after which he established his own investment firm, Hayes Capital Corporation, located in Los Angeles, California. DLJ was an underwriter in our 1997 public equity offering and was also the underwriter in our initial public offering in 1994. Mr. Hayes serves as a member of our Audit Committee and our Compensation and Stock Option Committee. Mr. Hayes served on our Nominating and Governance Committee through February 2005. Mr. Hayes is also a director of Circor International, Inc., a public company, the securities of which are traded on the New York Stock Exchange, and for which Mr. Hayes serves as chairman of the audit committee and as a member of the compensation committee. The Board of Directors has determined that Mr. Hayes is an independent director, and Mr. Hayes serves as our Lead Director for non-management director meetings.

     Franklin R. Johnson was appointed a director of Reliance in February 2002. Mr. Johnson is a certified public accountant, having been the managing partner of the entertainment practice of Price Waterhouse until he retired in June 1997. Mr. Johnson was the chief financial officer of Rysher Entertainment, a producer and distributor of films and television shows from June 1997 to June 1999. Since July 1999, he has served as a business consultant, a litigation consultant and an expert witness, but he has not provided any of these services to Reliance. Mr. Johnson serves as a member and the Chairman of our Audit Committee and as a member of our Nominating and Governance Committee. Mr. Johnson also serves as a director of Special Value Continuation Fund, a registered investment fund for institutional investors organized by Tennenbaum Capital Partners, for which Mr. Johnson is chairman of its audit committee. The Board of Directors has determined that Mr. Johnson is an independent director and that he qualifies as the financial expert of the Audit Committee.

     Leslie A. Waite has been a director of Reliance since 1977. Mr. Waite is an investment advisor and, since April 2003, has been Managing Director and Senior Portfolio Manager of Lombardia Capital Partners LLC (formerly Valenzuela Capital Partners LLC). Until December 2002, he had been the president and chief portfolio manager of Waite & Associates since its formation in 1977. Mr. Waite is a member of our Audit Committee and serves as a member and Chairman of our Compensation and Stock Option Committee. The Board of Directors has determined that Mr. Waite is an independent director.

     Named Executive Officers

     In addition to Messrs. Hannah and Mollins, the following are the named executive officers of Reliance:

     Karla R. Lewis became Executive Vice President of Reliance in January 2002 and continues as our Chief Financial Officer. Mrs. Lewis was also appointed an Assistant Corporate Secretary in 2007. Mrs. Lewis had been Senior Vice President and Chief Financial Officer of Reliance since February 2000. Mrs. Lewis served as Vice President and Chief Financial Officer of Reliance from 1999 to 2000 and was Vice President and Controller from 1995 to 1999. Mrs. Lewis served as Corporate Controller from 1992 to 1995. For four years prior to joining Reliance, Mrs. Lewis, a certified public accountant, was employed by Ernst & Young (our independent registered public accounting firm through 2007) in various professional staff positions.

     James D. Hoffman became Senior Vice President, Operations in October 2008. Prior to his appointment, he served as executive vice president and chief operating officer of our subsidiary, Earle M. Jorgensen Company, from April 2006 to September 2008. Mr. Hoffman was appointed executive vice president of Earle M. Jorgensen Company in January 2006, having been a vice president of Earle M. Jorgensen Company from 1996.

     James P. MacBeth became Senior Vice President, Carbon Steel Operations in January 2002, having been promoted from Vice President, Carbon Steel Operations, a position which he had held since July 1998. Prior to that time, Mr. MacBeth served as Division Manager of our Los Angeles Reliance Steel Company division from September 1995 to June 1998. From December 1991 to September 1995, Mr. MacBeth was Vice President and Division Manager of Feralloy Reliance Company, L.P., a joint venture owned 50% by Reliance. Prior to December 1991, Mr. MacBeth held various sales and management positions since joining Reliance in 1969.

     William K. Sales, Jr. became Senior Vice President, Non-Ferrous Operations in January 2002, having joined Reliance as Vice President, Non-Ferrous Operations in September 1997. From 1981 to 1997, Mr. Sales served in various sales and management positions with Kaiser Aluminum & Chemical Corp. (now Kaiser Aluminum Corporation), a producer of aluminum products and a supplier of Reliance.

     Significant Corporate Officers

     In addition, the following Reliance officers are expected to make significant contributions to our operations:

     Stephen P. Koch, 43, became Vice President, Operations of Reliance as of April 1, 2010. From July 2007 until he joined Reliance, Mr. Koch had been President of Chapel Steel Corp., a subsidiary of Reliance. Prior to that he held the positions of Executive Vice President of Chapel from 2005 to June 2007, Vice President of Chapel from 1995 to 2005 and had previously served as sales manager of Chapel Steel Corp.

     Brenda Miyamoto, 37, became Vice President and Corporate Controller in May 2007, having been promoted from Corporate Controller, a position which she had held since January, 2004. Prior to that time, Ms. Miyamoto served as Group Controller from December 2001 to January 2004. For six years prior to

joining Reliance, Ms. Miyamoto, a certified public accountant, was employed by Ernst & Young LLP (our independent registered public accounting firm through 2007) in various professional staff and manager positions.

     Donna Newton, 56, became Vice President, Human Resources in January 2001. Ms. Newton joined Reliance as Director of Employee Benefits and Human Resources in February 1999. Prior to that time, she was director of sales and service for the Los Angeles office of Aetna U.S. Healthcare and also held various management positions at Aetna over a 20-year period. Aetna is our health and medical insurance provider.

     Kay Rustand, 62, joined Reliance as Vice President and General Counsel in January 2001 and as of April 1, 2010 she became the Corporate Secretary. Prior to that time, Ms. Rustand was a partner at the law firm of Arter & Hadden LLP (our former counsel) in Los Angeles, California, for more than 10 years, specializing in mergers and acquisitions, corporate and securities law. Following law school, Ms. Rustand served as a law clerk for the Honorable Herbert Y. C. Choy, of the U. S. Court of Appeals, 9^th Circuit.

     Sheldon U. Tenenbaum, 64, became Senior Vice President, Supplier Development in May 2009. Mr. Tenenbaum served as Vice President of Chatham Steel Corporation from 1998 when Reliance acquired Chatham until 1999 when he became Director of Supplier Relations for Reliance. Chatham Steel Corporation is a subsidiary of Reliance Steel & Aluminum Co. Mr. Tenenbaum has over 39 years of metals service center industry experience.

     Colleen Wolf, 45, joined Reliance as Chief Information Officer in July 2008. Prior to that time, Ms. Wolf served as the vice president, North American business systems for Starbucks from October 2007 to July 2008 and as the chief information officer and senior vice president of New Century Financial from April 2006 to September 2007. From 1996 to April 2006, Ms. Wolf was vice president, information technology, supply chain and corporate finance for Mattel, Inc.

COMPENSATION DISCUSSION AND ANALYSIS

The following discussion and analysis should be read together with the information presented in the Summary Compensation Table and other compensation tables and the footnotes to those tables and related disclosures elsewhere in this proxy statement.

Overview

     The Company’s executive compensation program is administered by the Compensation and Stock Option Committee of the Board of Directors (the “Compensation Committee”), which is composed entirely of independent, non-employee directors and which makes recommendations to the non-management directors on the Board of Directors regarding the compensation of the Company’s corporate officers, including the named executive officers as defined in Rule 402(a)(3) under the Securities Exchange Act of 1934, as amended. The executive compensation program is a pay-for-performance program that is designed to motivate corporate officers to enhance shareholder value with compensation plans that are tied to Company performance as well as individual performance and to ensure our ability to attract and retain superior corporate officers by targeting total compensation at a level competitive with other companies in our industry or companies having size or complexity comparable to our Company. The executive compensation program is also structured to ensure that the Company’s compensation expense is aligned with the Company’s earnings and return on shareholders’ equity. To meet these objectives, the program has both cash and equity elements and short-term, long-term and retirement benefits. The named executive officers generally receive a base salary, an annual cash incentive bonus, grants of stock options and/or restricted stock and certain retirement benefits, as well as benefits common to all of our Company’s employees.

     The Compensation Committee evaluates, from time to time with the help of an outside consultant, both the total compensation package and the individual elements of the package on at least an annual basis. The Compensation Committee considers both qualitative and quantitative criteria in determining the amount of the total compensation package and the allocation between cash and non-cash elements, historical compensation records of the Company, and recommendations and evaluations by named executive officers with respect to officers they supervise. For 2008 and 2009 the Compensation Committee engaged ECG Advisors, LLC as its consultant and for 2010 the Compensation Committee has engaged Towers Watson as its consultant. Both consultants are independent and have not provided any services to the Company other than as a consultant to the Compensation Committee or, with respect to ECG, as a consultant to another committee of the Board. With the help of its consultant, the Compensation Committee develops a peer group of companies within the same industry and of companies of comparable size and complexity, and the Compensation Committee then reviews available compensation information for officers of companies in each peer group and also may review surveys that cross industries and company size, taking into consideration the Company’s performance in relation to the peer group. The Compensation Committee may also provide guidelines to our Chief Executive Officer (“CEO”) for compensation of management personnel other than the named executive officers based on the information reviewed.

Compensation Committee

     The Compensation Committee is comprised solely of directors who satisfy the independence requirements of the listing standards for the New York Stock Exchange, come within the definition of “non-employee directors” pursuant to Rule 16b-3 under the Securities Exchange Act of 1934, as amended, and are deemed to be “outside directors” for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended. Management assists the Compensation Committee in its administration of the executive compensation program by providing quantitative data and qualitative evaluations regarding both our

Company’s and each individual’s performance. The Compensation Committee reviews our Company’s financial statements and compares the Company’s financial results with those of the peer group, compares certain stock market data for the Company, the peer group and general indices (including stock performance over various time periods and volatility), and compares compensation information for our named executive officers with that for comparable executive officers of other public companies, including companies that the Compensation Committee has identified as the Company’s peer group based on size in terms of revenues and/or stock market capitalization structures, industry and complexity.

     The Compensation Committee generally engages an independent outside consulting firm to aid in the review and evaluation of the total compensation package provided to named executive officers. In 2008 and 2009, the Compensation Committee engaged ECG Advisors, LLC and in 2010 the Compensation Committee engaged Towers Watson. Each of the consultants has provided an objective review of the compensation paid to the named executive officers and has identified competitive levels and elements of compensation paid to similarly-situated executive officers at other public companies. Each of the consultants was asked to consider the Company’s executive compensation structure and to recommend changes consistent with what is considered market level or competitive total compensation for executive officers of similar public companies. Neither consultant was engaged to provide any other services to the Company, except with respect to ECG’s review on behalf of the Nominating and Governance Committee of our director compensation, as described below.

     There are no public companies in the metals service center industry that are of comparable size, complexity and performance to Reliance. Accordingly, in considering executive compensation for 2009 the Compensation Committee and ECG together developed a peer group for purposes of comparison, consisting of the following 15 Fortune 500-ranked public companies, in the same or similar industries with annual revenues ranging from $5.5 billion to $15.3 billion. The peer group includes:

	•		four metals companies: AK Steel Holding Company; Allegheny Technologies, Inc.; Commercial Metals Company; and Steel Dynamics, Inc.;
	•		three diversified wholesalers: Genuine Parts; W. W. Grainger, Inc.; and Wesco International;
	•		two Southern California Fortune 500-ranked companies that are in other businesses: Avery Dennison Group and Jacobs Engineering Group;
	•		five industrial companies: Dover Corp.; Eaton Corporation; ITT Corporation; Parker Hannifin Corp.; and Terex Corp.;

and

•

one other Fortune 500-ranked company in computers and office equipment: Pitney Bowes, Inc.

(together, the “2009 Peer Group”). The 2009 Peer Group was selected so that the Company would be approximately in the middle of the group with respect to various financial metrics, based on 2008 information (the most recent information then available). The Compensation Committee made its compensation determinations, including those regarding performance goals under the Corporate Officers Bonus Plan and equity compensation, in January and February of 2009 for the 2009 year. Based on the Company’s 2008 financial information compared to the 2009 Peer Group financial information for 2008, the Company was at the 49^th percentile for annual revenues, the 40^th percentile for net income, the 55^th percentile for return on equity and in the 40^th percentile for a five-year compound annual total shareholder return when compared with the companies in the 2009 Peer Group. The peer group identified by the Compensation Committee may change from year to year, depending on the Company’s growth, changes in the economy and other events that might make any individual company more or less comparable to Reliance, and is expected to change for 2010 given the recent recession.

     The Compensation Committee also compared the performance of the Company’s stock price to the stock prices of the 2009 Peer Group and of other companies in the metals and metals service center industries, including AK Steel Holding Company; Allegheny Technologies, Inc.; A.M. Castle & Co.; Century Aluminum; Commercial Metals Company; Gibraltar Industries; Nucor Corporation; Olympic Steel; and Worthington Industries, Inc., as well as the Standard & Poor’s 500.

Policies

     The executive compensation program of the Company was established by the Board of Directors initially and is annually reviewed by the Compensation Committee. The non-management members of the Board must approve all changes in the policies, programs or plans affecting executive compensation. The executive compensation program is a pay-for-performance program that is designed to:

	•		motivate executives to enhance shareholder value with compensation plans that are tied to Company performance;
	•		target executive compensation at a level to ensure our ability to attract and retain superior executives; and
	•		align executive compensation with Company earnings.

     Reliance enjoys a team-oriented corporate culture and has rewarded the entire team of executive and corporate officers for their joint efforts that result in the Company’s performance. The Company believes that attracting and maintaining a team of superior officers with complementary skills and expertise has proven successful for the Company’s growth, both organically and through acquisitions, and for maintaining the Company’s profitable financial performance, each of which generally enhances shareholder value. None of the Company’s officers, including the named executive officers, has an employment contract, severance agreement, change of control agreement or other similar agreement. To motivate executive officers to enhance shareholder value, we maintain a pay-for-performance compensation structure that puts much of the executive officers’ compensation at risk, depending on the Company’s performance and that rewards our executive officers principally for the amount of return on beginning shareholders’ equity. Executive officers are also rewarded for individual performance, activities that further the strategic vision and goals of the Company, and the individual’s level of responsibility and length of time with the Company. The underlying principle that all of the Company’s senior management is required to adhere to is to maintain the Company’s reputation for honesty and integrity, while providing excellent, responsive service to our customers, maintaining excellent relationships with our suppliers and maintaining credibility with our investors and access to capital markets and acquisition opportunities. Failure to adhere to this principle could result in a reduction in compensation or termination of employment.

     Our compensation structure for our named executive officers has four main elements: base salary, cash incentive bonus, equity incentive bonus (which may consist of either or both stock options or restricted stock) and retirement or deferred compensation benefits, which together provide short-term, long-term and retirement benefits, and have both cash and equity components. The allocation between cash and non-cash elements is intended to provide short-term benefits (cash) and long-term benefits (non-cash), giving relatively more weight to annual cash bonuses and retirement benefits and less weight to equity awards, base salaries and perquisites. The allocation between the base salary and the cash incentive bonus is intended to place a significant portion of the named executive officers’ compensation at risk, based on the Company’s performance. For 2009, if the Company had achieved a return of 12% on beginning shareholders’ equity (which the Compensation Committee considered to be an attractive return for shareholders over time at the time that the sliding scale for 2009 was adopted), then the named executive officers would have earned an incentive bonus equal to 100% of the executive officer’s base salary, which is the target amount (taking into account that the base salaries are generally below average), and an above-average return would normally result in a higher percentage of the executive officer’s base

salary being paid as a cash bonus. If the Company had not achieved the minimum return on beginning shareholders’ equity of 6% in 2009, no bonus would have been paid. Because of our record performances from 2004 through 2008, the average return on beginning shareholders’ equity has increased, so for 2010, the Compensation Committee determined that the target amount would be earned by the executive officers only if the Company achieved a return of 13% on beginning shareholders’ equity. The long-term benefits include both equity (to date through stock option grants) and retirement benefits. The equity component is intended to more closely align officers’ and shareholders’ interests and to more closely align the officers’ compensation with the Company’s stock performance. Both of the long-term benefits are intended to encourage the officers to remain with the Company and to increase shareholder value.

     In February 2007 the Compensation Committee and the non-management directors on the Board of Directors established the requirement that the named executive officers maintain an ownership position in our common stock at least equal to five times base salary for our principal executive officer (our CEO), four times base salary for our chief operating officer, three times base salary for our principal financial officer (our CFO), and two and a quarter times base salary for the other named executive officers. All of the named executive officers, other than James D. Hoffman who was appointed in October 2008, are in compliance with the stock ownership requirements. Mr. Hoffman has a period of five years from his date of appointment in which to comply with the requirement. The policy also provides that all officers who are not named executive officers must maintain a shareholding position in the Company of from one to two and a quarter times their base salaries.

     The Company has had a supplemental executive retirement plan (“SERP”) since 1996 that was designed to provide the deferral of a moderate portion of the executive’s total compensation until retirement, in which all named executive officers other than James D. Hoffman participate. Through December 31, 2008, the SERP benefit payable to each participant was 50% of Final Average Compensation offset by the value that the participant was expected to receive from the Company’s contributions to the participant’s accounts in the Company’s 401(k) Plan and ESOP, including earnings thereon from the date of contribution to retirement, as well as amounts the participant was to receive from social security. This resulted in the Company bearing the risk of any fluctuations in the value of those investments. Because of the significant decline in overall investment markets in 2008, the Company’s SERP expense increased significantly. As of January 1, 2009 the SERP was amended and restated to bring the SERP into compliance with Rule 409A under the Internal Revenue Code and was changed to reduce the benefit paid under the formula from 50% to 38% of Final Average Compensation and to eliminate the offsets, thereby transferring the risk of the investment fluctuations to the participants, as well as freezing the SERP to new participants.

     As of December 2008 the Company adopted a deferred compensation plan to replace certain subsidiary deferred compensation plans or supplemental executive retirement plans that were in existence at the time that the Company acquired those subsidiaries. Adopting the new plan resulted in administrative cost savings to the Company and brought all plans into compliance with Rule 409A under the Internal Revenue Code. None of the named executive officers participates in the deferred compensation plan, other than Mr. Hoffman who participated in the Earle M. Jorgensen Company (“EMJ”) deferred compensation plan, which plan was replaced. The Company contribution made to the deferred compensation plan for the benefit of Mr. Hoffman was based on the formula applicable under the replaced plan.

Procedures

     The Compensation Committee is charged with assisting the Board to fulfill its obligations with respect to the compensation policies and does so by gathering both current and historical information relevant to the performance of the Company as compared to the identified peer group, compensation paid to named executive officers of the Company and comparable officers with the companies in the peer group identified by the Compensation Committee, and from time to time surveys of other public companies that the Compensation Committee determines to be comparable or useful. The Compensation Committee also reviews the compensation paid to our subsidiary officers each year. At the request of the Compensation

Committee, our CEO annually provides a summary of accomplishments and disappointments for the year under review, goals and results for the year under review and goals for the year ahead, a discussion of any tactical and strategic risks, any revisions to the strategic vision of the Company and a review or evaluation of each of the corporate officers, including the named executive officers. The Compensation Committee reviews and discusses these items before it begins any analysis specifically related to the mix, structure or amount of total compensation for the corporate officers.

     After reviewing that information and the data previously gathered, the Compensation Committee makes recommendations for the compensation to be paid to the CEO and other corporate officers. The Compensation Committee then discusses these recommendations with the CEO and presents these recommendations to the non-management members of the Board of Directors in executive session. The cash portion of the compensation is generally considered at a different time from the equity portion, although the Compensation Committee does analyze the proposed total compensation package before making any recommendations. The independent, non-management directors of the Board make the final determination of the compensation to be paid to the CEO and the other corporate officers of the Company.

Elements

     The compensation paid to each of the named executive officers is structured in the same manner and contains the same basic elements as for all of the corporate officers, that is, base salary, an annual cash incentive bonus, long-term compensation in the form of stock options and retirement benefits. All of the named executive officers other than James D. Hoffman (who participates in the Reliance Deferred Compensation Plan) are also eligible to receive benefits under our SERP, which provides certain retirement benefits to the named executive officers, among others. Our named executive officers may participate in our 401(k) Plan and health and medical insurance benefit plans, obtain life and disability insurance, and receive ESOP benefits on the same basis as these benefits are generally available to all eligible employees. (Since our Company is decentralized, we do not have master plans for each of these benefits that apply to employees Company-wide. Certain of our plans, such as the ESOP, are available only to employees of Reliance. Other plans are available only to employees of certain subsidiaries and not corporate officers.) In lieu of either providing a car or reimbursing certain personnel for auto travel, certain members of senior management, including the named executive officers, are paid a car allowance of $700 monthly, which is considered a perquisite.

     Base Salary

     The base salary is what the name implies — the primary, or base, compensation for each of the named executive officers, which is the minimum pay that an officer receives in any year. The base salaries of the named executive officers tend to be at the low end of the range of reasonably competitive salaries paid to comparable officers at companies in the identified peer group. The Compensation Committee benchmarked the base salaries of the named executive officers against the base salaries of comparable officers at companies in the 2009 Peer Group. The Compensation Committee found that the base salaries of the named executive officers were significantly below market, with the base salary of the Chief Executive Officer, the President and Chief Operating Officer, and the Chief Financial Officer being 25% to 30% below those officers in the 2009 Peer Group. A greater portion of the Company’s executive compensation is at risk because the Company has established lower base salaries, but potentially higher cash bonuses that are tied to the return on beginning shareholders’ equity, resulting in combined cash compensation consistent with the 2009 Peer Group. Base salaries for all of the corporate officers of the Company, including the named executive officers, have been frozen since January 2008 in light of the economic crisis.

     Incentive Bonus

     In February 2008 the Compensation Committee recommended and the independent non-management directors on the Board of Directors approved a Corporate Officers Bonus Plan (the “Bonus

Plan”) that is a non-equity incentive bonus plan for all corporate officers of Reliance, including the named executive officers. The Bonus Plan was also approved by the shareholders at the annual meeting in May 2008. The Bonus Plan is primarily a quantitative calculation based on the annual total return on beginning shareholders’ equity for the named executive officers and simplifies the calculations made under the Key-Man Incentive Plan that was in place prior to 2008. The Compensation Committee in the first quarter of each year adopts a sliding scale to calculate the bonus for named executive officers. In 2009 the sliding scale provided for a bonus to be paid to named executive officers if the Company’s annual rate of return on beginning equity was 6% or more, with the amount of bonus calculated as a corresponding percent of base salary ranging from 14% to 300%. By way of example, the named executive officers would receive no bonus if the rate of return were below 6%, a bonus of 100% of base salary if the rate of return were 12% (which was considered the target, based on the Company’s long-term average return on beginning shareholders’ equity) and a maximum of 300% of base salary if the rate of return were 25% or greater. Despite this quantitative calculation, the independent, non-management directors on the Board of Directors have final authority to approve these bonuses. The sliding scale for the Bonus Plan for 2010 as approved by the independent directors establishes similar performance goals applicable for 2010, with the target rate of return being increased to 13% from 12%, reflecting the higher long-term average rate of return resulting from the Company’s record performances in 2004 through 2008, and the percent of base salary ranging from 12.5% for a 6% rate of return to 300% for a rate of return equal to or in excess of 25%. This Bonus Plan is intended primarily to reward the named executive officers for the Company’s performance.

     Under the Bonus Plan, the named executive officers in 2009 would have been entitled to receive the target bonus amount if the Company’s return on beginning shareholders’ equity had been 12% and up to the maximum bonus amounts if the Company had a return on beginning shareholders’ equity equal to or in excess of 25%. For 2009, however, the Company’s return on beginning shareholders’ equity was only 6.1%, so none of the Company’s officers received the target bonus amount; the named executive officers received the threshold amounts equal to 14% of their respective base salaries. The threshold bonus was reduced to 12.5% of base salary for 2010, and the target bonus and the maximum bonus as a percent of base salary remain the same for 2010, but the named executive officers will not be entitled to receive the target bonus amount equal to 100% of base salary unless the Company achieves a return on beginning shareholders’ equity equal to 13%, an increase from the 12% applicable for 2009. We cannot predict with any certainty the probability of the named executive officers receiving any specific bonus amount in 2010, since it depends on the performance of the Company. If the Company achieves record performances as it did in 2006 through 2008, the named executive officers may receive amounts equal to 250% or more of their respective base salaries as their cash bonuses under the Bonus Plan. On the other hand, if the Company achieves a return on beginning shareholders’ equity similar to that achieved in 2009, the named executive officers would receive only the threshold amount equal to 12.5% of their respective base salaries as shown below. The Compensation Committee established the target bonus percentage based on the assumption that in a normal economy the Company should be able to achieve a 13% return on beginning shareholders’ equity, but there is no guarantee that it will do so. The table below illustrates the threshold, target and maximum bonuses that would be payable under the Bonus Plan based on the identified officers’ current base salaries if the Company achieves the correlated level of performance, but the Company cannot provide any assurance that it will achieve any particular return on beginning shareholders’ equity.

		Threshold				Target				Maximum
Officer Name/Title		Bonus Amount				Bonus Amount				Bonus Amount
David H. Hannah Chairman and Chief Executive Officer		$	87,500			$	700,000			$	2,100,000
Gregg J. Mollins President and Chief Operating Officer		$	65,000			$	520,000			$	1,560,000
Karla R. Lewis Executive Vice President, Chief Financial Officer and Assistant Secretary		$	46,875			$	375,000			$	1,125,000
James D. Hoffman Senior Vice President, Operations		$	41,250			$	330,000			$	990,000
James P. MacBeth(1) Senior Vice President, Carbon Steel Operations		$	20,000			$	160,000			$	480,000
William K. Sales, Jr. Senior Vice President, Non-Ferrous Operations		$	41,250			$	330,000			$	990,000
Named Executive Group		$	301,875			$	2,415,000			$	7,245,000
Non-Executive Director Group		$	-0-			$	-0-			$	-0-
Other Corporate Officer Employee Group(3)		$	111,520			$	892,167			$	2,676,500	(2)

     When benchmarking the incentive cash bonus against bonuses paid to comparable officers at companies in the 2009 Peer Group, the Compensation Committee found that the annual bonuses paid to the named executive officers for the Company’s record performances were among the highest of the 2009 Peer Group. Combined with the lower base salaries, however, the total cash compensation amounts are within a reasonable range of those of the comparable officers of the 2009 Peer Group. When developing the sliding scale for the incentive bonuses, the Compensation Committee determined that the Company’s average return on beginning shareholder’s equity from 1978 to 2004 was 12.8%, with a median return of 13.2%. For the period from 1978 through 2008 following five record performance years, the average rate of return over the period had increased to 14.3% and the median had increased to 13.7%. Because of this increase in the average and median rate of return, the Compensation Committee increased the target rate of return on beginning shareholders’ equity for 2010.

     The rates of return have varied from a low of 1.6% to a high of 32.6% during the period from 1978 to 2008. In only three years in that period has the Company exceeded the 25% rate of return, which the Compensation Committee has determined is required for the named executive officers to achieve the maximum incentive bonus equal to 300% of their respective base salaries. The rate of return in 2006 exceeded 25%, the rate of return for 2007 was 23.4% and the rate of return for 2008 was 22.9%. Because of the economic downturn, the Company’s rate of return on beginning shareholders’ equity for 2009 was 6.1%. Accordingly, for 2009 all of the named executive officers received 14% of their respective base salaries as an incentive bonus, down from the 269% received for 2008. We cannot predict with any reasonable certainty the likelihood that the named executive officers will receive their target bonuses for 2010. The Compensation Committee believes that the sliding scale is a reasonable quantitative approach to determining the bonuses to be paid, which reflects the Company’s performance in good times and bad and awards the named executive officers accordingly.

     Until 2008, the Company awarded bonuses to its named executive officers under its Key-Man Incentive Plan, which the Company had maintained for division managers and corporate officers of Reliance since 1965, with amendments from time to time. The Key-Man Incentive Plan was developed primarily as a quantitative calculation based on the annual operating results of the Company, with the point assignment being a qualitative element. To determine the bonus amounts to be paid under the Key-Man Incentive Plan, the Compensation Committee first calculated the bonus pool, which was an amount equal to 20% of the amount by which the Company’s net income for the current year exceeded the average risk-free rate of return on a one year Treasury bill applied to the Company’s net worth at the beginning of the year. That amount was then divided by the total points that the Compensation Committee had allocated to all participants under the Plan to determine the value per point, which was then multiplied by each participant’s number of points assigned by the Compensation Committee. Under the Key-Man Incentive Plan, the Compensation Committee established maximum bonus amounts for each individual, based on a percent of that person’s base salary. In 2007, the maximum bonus amounts for the named executive officers were determined based on a sliding scale with percentages of base salary corresponding to certain rates of return on beginning shareholders’ equity, so that the maximum bonus payable to any named executive officer would equal the corresponding percentage applicable for the Company’s return on beginning shareholders’ equity shown on the sliding scale, which was the same sliding scale adopted for the Corporate Officers’ Bonus Plan described above. In 2007 the Company’s return on beginning shareholders’ equity was approximately 23% and, accordingly, the maximum incentive bonus amount payable to the named executive officers under the Key-Man Incentive Plan was 269% of their respective base salaries. Under the Key-Man Incentive Plan the corporate officers, including the named executive officers, could elect to receive 25% of their bonus in shares of restricted common stock. None of the officers made such an election for the 2007 bonus.

     Stock Option and Restricted Stock Plan

     We have adopted, and the shareholders have approved, the Amended and Restated Stock Option and Restricted Stock Plan (the “Stock Plan”). The Stock Plan is intended to encourage the named executive officers and other key employees of the Company and its subsidiaries to remain with the

Company on a long-term basis and to reward individual performance and levels of responsibility. The scope and authority of the Compensation Committee is defined by the Stock Plan. The Compensation Committee has complete authority to interpret the Stock Plan and make all decisions with respect to how it functions. The Compensation Committee recommends to whom and in what number, and with what terms and conditions, options or restricted stock should be granted, but the independent, non-management members of the Board must confirm any grant of stock options or issuance of restricted stock. Under the Stock Plan, the Compensation Committee may recommend to the Board of Directors the grant of incentive stock options, non-qualified stock options or restricted stock. The granting and exercise of incentive stock options would require the Company to pay applicable taxes; whereas, the granting and exercise of non-qualified stock options and vesting of restricted stock require the individual to bear the burden of paying applicable taxes, with a corresponding tax deduction for the Company. Thus far, we have granted only non-qualified stock options, and we have not granted any incentive stock options or issued any restricted stock under the Stock Plan, so the Company is not responsible for any of the applicable taxes. James D. Hoffman was an officer of Earle M. Jorgensen Company (“EMJ”) at the time that the Company acquired EMJ, and Mr. Hoffman, as well as several other EMJ employees, currently holds certain incentive stock options that were granted to him by Earle M. Jorgensen Company before Reliance acquired it and that were converted to options to acquire Reliance common stock as a result of the acquisition. All awards under the Stock Plan to named executive officers are approved by the independent, non-employee directors of the Company. The Compensation Committee considers the recommendations of our Chief Executive Officer with respect to any grants or awards to the other named executive officers and other corporate officers, as well as to other key employees.

     In making its recommendations to the Board, the Compensation Committee considers the position of the named executive officer, his or her importance to the Company’s results, his or her individual performance, the number of options already granted to that individual and the option price or prices at which those earlier granted options are exercisable, the total number of options to be recommended for granting and the relative number of such recommended option grants among the various individuals then under consideration for option grants, as well as the potential dilution and the related stock option expense as a percentage of pre-tax income.

     Under the terms of the Company’s Stock Plan, the exercise price of the stock option must be at least equal to the fair market value of the underlying stock on the date of grant. The fair market value is defined, for purposes of the Stock Plan, as the value at least equal to the closing price of Reliance common stock on the New York Stock Exchange Composite Index on the business day immediately prior to the grant date.

     The Company did not grant any stock options in 2006 because of the Company’s acquisition activities throughout the year. The Compensation Committee recommended that a larger number of stock options be granted to the named executive officers in 2007 and also determined to recommend annual grants of stock options in the future. In addition, in March 2007 the Compensation Committee determined, because of the cyclicality of the Company’s business operations, to make the term of newly-granted stock options seven years, instead of the five years that was applicable to previously granted stock options, but the options continue to become exercisable at the rate of 25% per year commencing one year from the date of grant. Beginning in 2008, the Compensation Committee determined that no more than 33% of the total options granted should be granted to all of the corporate officers as a group, including the named executive officers. When determining the number of stock options to grant to the named executive officers for 2009, the Compensation Committee found that stock options are the most prevalent form of equity compensation used by the 2009 Peer Group and that the value of the stock options granted to the named executive officers was significantly below the value of equity grants to comparable officers in the 2009 Peer Group.

     The Company does not plan to time nor has it timed its release of material non-public information for the purpose of affecting the value of any stock or stock options granted. In fact as noted above with respect to 2006, the Company has delayed the grant of options until material non-public information has

been publicly disclosed and the market has had a reasonable opportunity to react to the information. Historically, the Compensation Committee has recommended grants of stock options for named executive officers at such times as it believed appropriate to ensure that each of the named executive officers had a reasonable amount of unexercised stock options. Since 2007, the Compensation Committee determined to make annual grants under the Stock Plan after the Company has reported its annual earnings and the market has had an opportunity to react to the Company’s release of its financial results. In February 2010, the Compensation Committee recommended and the Board of Directors approved the grant of a total of 240,000 non-qualified stock options to the named executive officers at an exercise price of $42.81 per share.

     SERP and Deferred Compensation Plan

     In 1996, Reliance adopted a Supplemental Executive Retirement Plan (“SERP”) to provide post-retirement benefits to certain of our named executive officers (other than James D. Hoffman, who was not then a corporate officer) and to certain other key employees, as the Compensation Committee, in its discretion, has determined appropriate from time to time. The SERP was amended in 1999 to provide for a pre-retirement death benefit. Effective January 1, 2009, the SERP was amended and restated and frozen to new participants. One of the primary objectives of the amendment was to shift the risk of the performance of the individual’s retirement plan investments from the Company to the participants. Through December 31, 2008, the SERP benefit payable to each participant was offset by the value that the participant was expected to receive from the Company’s contributions to the participant accounts in the Company’s 401(k) Plan and ESOP, including earnings thereon from the date of contribution to retirement, as well as amounts the participant was to receive from social security. These offsets resulted in the Company bearing the risk of any reductions in the value of those investments. Because of the significant decline in overall investment markets in 2008, the Company’s SERP expense increased significantly as the amount of the benefit payable by the SERP increased. The 2009 amendment and restatement eliminated the offsets to the SERP benefit and reduced the benefit amount to 38% of the average of the participant’s highest five years of the last ten years of total cash compensation (from 50% less offsets for the value of the Company contributions to the 401(k) Plan and ESOP plans as well as social security benefits). The amendment also froze the plan to new participants, brought it into compliance with Rule 409A under the Internal Revenue Code, and clarified certain provisions. The new benefit formula was intended to provide participants with approximately the same benefits that they would have received under the calculation required by the SERP before the amendment, but shifts certain risks from the Company to the participant. Reliance also adopted a deferred compensation plan effective December 1, 2008, to combine and replace certain deferred compensation plans and supplemental executive retirement plans that existed at certain companies at the time that we acquired them. James D. Hoffman was previously a participant in a subsidiary plan that was replaced, and he now participates in the Reliance Deferred Compensation Plan.

     The Compensation Committee considers the SERP benefits and any benefits under the Reliance Deferred Compensation Plan in its analysis of the total compensation paid to the named executive officers. In benchmarking the values of the SERP against the retirement benefits offered at companies in the 2009 Peer Group, the Compensation Committee found that the values are high for the named executive officers.

Other Benefits

     Our 401(k) Plan allows all eligible employees, including the named executive officers, who have been employed a minimum of three months, to defer a portion of their eligible compensation and provides a matching contribution of up to 3% of eligible compensation, subject to certain IRS limitations ($245,000 total compensation in 2009). All named executive officers participate in this 401(k) Plan. We have maintained an Employee Stock Ownership Plan (“ESOP”) since 1974, which was approved by the IRS as a qualified plan. All non-union employees of Reliance, including the named executive officers, are eligible to participate in the ESOP as of the first January 1 after one and one-half years’ of service. An employee who is eligible to participate in the ESOP is fully vested in the shares of our common stock allocated to

his/her ESOP account. Allocation is based on the participant’s eligible compensation each year, including bonuses, as compared to the total compensation of all participants, subject to the maximum amounts established by the IRS ($245,000 total compensation in 2009). The Company also pays 100% of the healthcare insurance premiums for the named executive officers and his/her dependents, as we do for all eligible employees of Reliance, and the Company provides a car allowance and parking for the named executive officers. (The Company provides parking or public transportation benefits for most of its corporate office employees.) The Company also provides club memberships for our named executive officers that are intended to be used for business purposes. When benchmarking the perquisites provided to the named executive officers compared with the 2009 Peer Group, the Compensation Committee found that the perquisites were significantly below market.

Analysis

     When making decisions regarding the compensation of our named executive officers, the Compensation Committee considers information from a variety of sources. The Compensation Committee obtains from our accounting department historical data on the level of compensation paid to executive officers and subsidiary officers by the Company in the past, both individually and in relation to one another. The accounting department, with assistance from outside experts, also prepares certain quantitative calculations regarding the values of stock option grants and retirement benefits. Members of the Compensation Committee and its consultant gather publicly available information on compensation paid by members of the Company’s identified peer group, as well as information regarding the Company’s performance and results relative to these other companies and companies in the metals service center industry, and may review from time to time surveys of related compensation information. The composition of the peer group is reviewed annually and, if necessary, the Compensation Committee may revise the peer group in an effort to assure comparability of information. The information on other companies, including the 2009 Peer Group, alone is not determinative. The Compensation Committee analyzes both the individual elements and the total compensation packages for each of the named executive officers. In addition to the relative financial results of the Company compared to companies in the peer group and companies in the metals service center industry and compensation of comparable executive officers in each of these groups, the Compensation Committee considers factors such as the Company’s stock performance as compared with standard indices, such as the Standard & Poor’s 500. The Compensation Committee recognizes that, given the stock holding requirements and the amounts of stock actually held, the named executive officers are directly impacted by the Company’s stock price and, accordingly, their interest in the Company’s performance and the impact it has on the market value of the stock are closely aligned with that of the Company’s shareholders.

     The Compensation Committee extensively analyzed the following income statement, balance sheet, and stock market data of the Company and the 2009 Peer Group, for the 2008 year, since that was the most recent information available at the time the decision was being made:

Annual revenue
Net income
Operating margins
Return on equity
Number of full-time employees
Stock-market capitalization
One, three, five, and 10-year stock market returns benchmarked against various stock indices
Capitalization and debt ratios
Black Scholes factors

     The Compensation Committee also considered the structure of total compensation (base salary, cash bonus, long-term incentive plans, and SERP and related long-term or retirement plans) as compared to the 2009 Peer Group. This discussion of the structure of various executive compensation programs included the following:

Various elements of pay expressed as a percent of salary
Mix of direct pay
Value of annual equity grants
Long-term incentive plans
Non-qualified stock option plans of 2009 Peer Group companies
Rationale for restricted stock
Restricted stock and various performance standards
Retirement plans
Retirement plans of 2009 Peer Group companies

     Based on its analysis of the above and benchmarking against the 2009 Peer Group, the Compensation Committee determined that, although the Company’s position with respect to each element of compensation may vary, the total compensation for the named executive officers is competitive. The Compensation Committee, together with its consultant, determined that the Company’s annual cash bonuses (other than that for the CEO which ranked lower) and the SERP values for 2008 ranked high compared with those of the 2009 Peer Group, but the base salaries, equity awards and perquisites rank below those of comparable officers in the 2009 Peer Group. The Compensation Committee noted that the cash bonuses were significantly reduced for 2009 compared to 2008 but concluded that the level of the incentive cash bonuses was reasonable given the Company’s performance in 2009. In addition, the SERP values for 2009 were significantly reduced as a result of the amendment and restatement of the SERP. Given the volatility of the Company’s stock during the recession, the value of the awards of stock options granted to the named executive officers are significantly lower than the value of equity awards granted to comparable officers of the 2009 Peer Group. Our compensation structure emphasizes annual cash incentive bonuses, which are performance based, and retirement benefits, with lower base salaries, equity compensation and perquisites, thereby more closely tying executive compensation to Company performance, but also retaining long-term benefits.

     In 2008, the Company achieved record sales and earnings despite the economic recession, and completed its largest acquisition to date, based on transaction value and, consequently, the Company did not experience the immediate negative impact from the recession that many other companies experienced. Following the sudden and significant impact of the global economic downturn that we experienced beginning in the fourth quarter of 2008, the Company was faced with the most difficult operating environment that it had ever experienced in 2009. The management team worked together to generate record cash flow, reduce debt, reduce costs and ensure that the Company would be profitable despite the economy. The Company once again outperformed its peers.

     The Compensation Committee also considered the changes in the Company’s stock price compared to the changes in the stock price of the following companies: AK Steel Holdings, Allegheny Technologies, A.M. Castle & Co., Century Aluminum, Commercial Metals Company, Gibraltar Industries, Nucor Corporation, Olympic Steel and Worthington Industries, Inc., as well as the Standard & Poor’s 500 industry index for one-, three-, five- and ten-year periods. In all time periods Reliance’s stock performance ranked first or second among these companies. Excluding dividends, the increase in value in Reliance stock for three years was 9.8%, five years 121.9% and ten years 268.8%.

     In addition, from 2006 to 2008, the Company’s net income and sales have increased over the prior year, as shown below, but in 2009 both the Company’s net income and sales were down significantly. The Compensation Committee believes that the Bonus Plan appropriately adjusts the cash compensation of the Chief Executive Officer and the other named executive officers to reflect the significant change in the Company’s performance, as shown in the table below with respect to the Chief Executive Officer.

Percent Changes From Prior Year

										CEO Cash
										Compensation
Year		Net Sales				Net Income				(base + bonus)
2006			71	%			73	%			7	%
2007			26	%			15	%			(2	%)
2008			20	%			18	%			10	%
2009			(39	%)			(69	%)			(69	%)

     While mindful of the volatility of the Company’s stock price, the Compensation Committee recognized that the lowered price was principally a result of the economic upheaval from the meltdown of the financial markets and was not related specifically to the Company’s performance or the performance of the executive officers. The Compensation Committee commended the executive officers for their outstanding efforts to manage working capital, particularly by reducing inventory and expenses beginning in the fourth quarter of 2008 and continuing throughout 2009 in response to reduced customer demand. The significant increase in cash flow allowed the Company to reduce its debt and deleverage its balance sheet to maintain its investment grade credit rating, reducing our net debt-to-total capital ratio to 25.6% at the 2009 year end, down from 41.4% at the 2008 year end. To the knowledge of the Compensation Committee, Reliance is the only public metals service center company to have an investment grade credit rating and to have remained profitable during this economic crisis. The Compensation Committee believes that the Company’s total compensation plan is well designed, comprehensive and aligns management and the Board of Directors with creating value for each and every shareholder. Excluding dividends, the increase in value in Reliance stock for three years was 9.8%, five years 121.9% and ten years 268.8%. In all time periods, Reliance stock performance ranked first or second among its peer companies. The Compensation Committee finds these to be outstanding results and believes the shareholders are very fortunate to have the management team and all of the Reliance employees who contributed to this performance. The Compensation Committee, in collaboration with its consultant and after completing its analysis, concluded that the Chief Executive Officer’s cash compensation was below market for 2008 but that the total compensation was competitive, at approximately the 62^nd percentile of the 2009 Peer Group. The Compensation Committee also found, based on the information provided by its consultant for 2008, that the total compensation for Reliance’s other named executive officers was competitive, ranging from the 66^th to the 76 ^th percentile.

     Individual Performance Factors. Individual performance of each of the named executive officers principally impacts any increase in base salary (which in turn impacts the amount of the cash incentive bonus that is calculated as a percentage of the base salary) and the number of stock options granted. Each of the named executive officers contributed to the Company’s results in a number of ways, and all worked together as a team to rapidly and effectively respond to the dramatic decline in demand and pricing. The Compensation Committee considered, among other things, the following specific factors in addition to the more subjective factors of management style, problem-solving capabilities, supervisory responsibilities and the responsibilities of due diligence related to proposed acquisitions and the integration and subsequent performance of completed acquisitions of each of the named executive officers:

CEO — It is the CEO’s responsibility to develop a strategic vision for the Company and to ensure that the corporate officers take actions to further the Company’s long-term corporate goals and objectives. Mr. Hannah has been the principal factor in developing and implementing the acquisition strategy of the Company and in maintaining a strong balance sheet and adequate financing to allow the Company to grow both organically and through acquisitions. In 2009 Mr. Hannah developed and implemented a strategy to quickly respond to the economic downturn by maximizing liquidity, mainly by reducing inventory levels and controlling costs and using the cash generated to pay down debt, so that the Company deleveraged the balance sheet significantly by paying down approximately $830 million of debt, which provides us with ample liquidity not only to survive the recession but to end the year as a financially stronger and leaner company. At December 31, 2009, our net debt-to-total capital ratio was 25.6%, down from 41.4% at the 2008 year end and down from about 50% immediately following the completion of our acquisition of PNA as of August 1, 2008. Mr. Hannah also directly supervises certain of our specialty subsidiaries.

President and COO — Mr. Mollins, in addition to supervising Mr. Hoffman, Mr. MacBeth, and Mr. Sales and the presidents of some of our larger subsidiaries, was directly involved in the organic growth of the Company and in planning the expansion of existing operations. The presidents of the six PNA companies acquired in 2008 report directly to Mr. Mollins, who spent considerable time educating them on Reliance’s management strategy with respect to gross profit margins and inventory turns in the difficult operating environment in 2009. Mr. Mollins also oversees the capital expenditures of the Company; we spent $69.9 million on capital expenditures in 2009. Both Mr. Hannah and Mr. Mollins developed and implemented a plan to respond quickly to falling prices and worsening economic conditions by reducing inventory and expenses and increasing productivity. Mr. Mollins worked directly with the various subsidiaries to increase the cooperative attitude and encourage buying products within the Reliance family of companies to speed the reduction of inventory.

EVP and CFO — Mrs. Lewis supervises the Vice President, Human Resources and the Vice President and Corporate Controller, and serves on the executive committee overseeing the long-term development of the Company’s IT activities. Under Mrs. Lewis’s leadership, the Company managed its cash flow so as to maintain a strong balance sheet allowing continued access to capital, along with meeting all debt covenants and financial reporting requirements and maintaining strong internal controls throughout the Company. In addition, Mrs. Lewis spearheaded the amendment of the Company’s revolving credit facility to provide relief under our interest coverage ratio covenant and also extend the maturity date for $1.02 billion of our revolving credit facility to November 2012 from November 2011. Mrs. Lewis’s focus on deleveraging the balance sheet significantly by paying down approximately $830 million of debt provides us with ample liquidity not only to survive the recession but to end the year as a financially stronger and leaner company. At December 31, 2009, our net debt-to-total capital ratio was 25.6%, down from 41.4% at the 2008 year end and down from about 50% immediately following the completion of our acquisition of PNA as of August 1, 2008. Mrs. Lewis’s efforts in connection with the repayment of the debt related to the PNA acquisition and maintaining adequate liquidity allowed the Company to maintain an investment grade credit rating.

Sr. VP, Operations — Mr. Hoffman was appointed as a named executive officer in October 2008 and provided oversight for certain operating entities to maintain profitability, and improve inventory turns, and he was instrumental in implementing a

plan to respond quickly to falling prices and worsening economic conditions by reducing expenses and increasing productivity and cooperation among the Reliance family of companies.

Sr. VP, Carbon Steel Operations — Mr. MacBeth was principally involved in maintaining profitability, improving inventory turns and overseeing management of certain of our carbon steel operations, and implementing the Company’s strategy for organic growth of these operations. The Company expanded some of its existing facilities and updated processing equipment in certain key markets. Mr. MacBeth was instrumental in implementing a plan to respond quickly to falling prices and worsening economic conditions by reducing expenses and increasing productivity and cooperation among the Reliance family of companies.

Sr. VP, Non-Ferrous Operations — Mr. Sales was involved in maintaining profitability, improving inventory turns and overseeing management of certain of our non-ferrous operations, as well as implementing the Company’s strategy for organic growth for these operations. Mr. Sales continued to be involved in assisting in the expansion of our Company in Asia. In addition, Mr. Sales was involved in the expansion of existing facilities and updating of processing equipment at our non-ferrous operations, and took an active role in supervising certain of our Asian operations and implementing a more robust export compliance program. Mr. Sales is also on the executive committee overseeing the corporate IT strategy. Mr. Sales was instrumental in implementing a plan to respond quickly to falling prices and worsening economic conditions by reducing expenses and increasing productivity and cooperation among the Reliance family of companies.

     The performance of each of the named executive officers contributed to the Company’s record cash flow and ability to remain profitable in 2009.

Director Compensation

     In 2006, the Nominating and Governance Committee engaged ECG Advisors, LLC as an outside consultant to assist it in reviewing director compensation and recommended to the Board compensation levels that the Nominating and Governance Committee believes to be commensurate with other comparable public companies. An updated review was performed in 2008 and it was determined that the current director compensation levels were appropriate, except that the retainer paid to the Lead Director was increased. Directors are paid an annual retainer, payable quarterly, and fees for attending board or committee meetings or for chairing the meetings or a committee of the Board. Under the Amended and Restated Directors Stock Option Plan, which has been approved by the shareholders, non-employee directors are entitled to receive non-qualified options to acquire our common stock in accordance with that plan, including an automatic grant of 6,000 shares on the date of each Annual Meeting of Shareholders with an exercise price not less than the closing price of our common stock on the New York Stock Exchange Composite Index on the grant date. In February 2007, the Board of Directors adopted minimum requirements for directors to own the Company’s common stock. Directors are required to own shares of the Company’s common stock having a market value equal to at least five times the annual cash retainer received by directors, and directors have five years in which to acquire and begin maintaining that amount of the Company’s common stock. Andrew G. Sharkey, III, our newest director, is the only director who has not yet met this requirement.

Certain Federal Income Tax Consequences

     The following summarizes certain Federal income tax consequences relating to the Company’s Stock Plans. The summary is based upon the laws and regulations in effect as of the date of this Proxy Statement and does not purport to be a complete statement of the law in this area. Furthermore, the

discussion does not address the tax consequences of the receipt or exercise of awards under foreign, state, or local tax laws, and such tax laws may not correspond to the Federal income tax treatment described below. The exact Federal income tax treatment of transactions will vary depending upon the specific facts and circumstances involved and the participants are advised to consult their personal tax advisors with regard to all consequences arising from the grant or exercise of awards and disposition of any acquired shares.

     Stock Options

     The grant of a stock option under the Stock Plans will create no income tax consequences either to the Company or to the recipient. An individual who is granted a non-qualified stock option will generally recognize ordinary compensation income at the time of exercise in an amount equal to the excess of the fair market value of the common stock at such time over the exercise price. We will generally be entitled to a deduction in the same amount as and in the year in which the participant recognizes ordinary income. When the participant subsequently disposes of the shares of common stock received with respect to such stock option, the participant will recognize a capital gain or loss (long-term or short-term, depending on the holding period) to the extent the amount realized from the sale differs from the tax basis. (The tax basis will equal the fair market value of the common stock on the exercise date.)

     In general, a participant will recognize no income or gain as a result of the exercise of an incentive stock option, except that the alternative minimum tax may apply. Except as described below, a participant will recognize a long-term capital gain or loss on the disposition of the common stock acquired pursuant to the exercise of an incentive stock option, and we will not be allowed a deduction. If the participant fails to hold the shares of common stock acquired pursuant to an exercise of an incentive stock option for at least two years from the grant date and one year from the exercise date, then the participant will recognize ordinary compensation income at the time of the disposition equal to the lesser of the gain realized on the disposition and the excess of the fair market value of the shares of common stock on the exercise date over the exercise price. We will generally be entitled to a deduction in the same amount and at the same time as the participant recognizes ordinary income. Any additional gain realized by the participant over the fair market value at the time of exercise will be treated as a capital gain.

     Restricted Stock

     Generally, a participant will not recognize income and we will not be entitled to a deduction at the time an award of restricted stock is made under the Stock Plan, unless the participant makes the election described below. A participant who has not made such an election will recognize ordinary income at the time the restrictions on the stock lapse in an amount equal to the fair market value of the restricted stock at that time. We will generally be entitled to a corresponding deduction in the same amount and at the same time as a participant recognizes income. Any otherwise taxable disposition of the restricted stock after the time the restrictions lapse will result in a capital gain or loss to the extent the amount realized from the sale differs from the tax basis. (The tax basis would be the fair market value of the common stock on the date the restrictions lapse.) Dividends paid in cash and received by a participant who has not made a Section 83(b) election prior to the time the restrictions lapse will constitute ordinary income to the participant in the year paid, and we will generally be entitled to a corresponding deduction for such dividends. Any dividends paid in stock will be treated as an award of additional restricted stock subject to the tax treatment described in this section.

     A participant may, within thirty (30) days after the date of the award of restricted stock, make an election under Section 83(b) of the Internal Revenue Code to recognize ordinary income as of the date of the award in an amount equal to the fair market value of such restricted stock on the date of the award less the amount, if any, the participant paid for such restricted stock. If the participant makes such an election, then we will generally be entitled to a corresponding deduction in the same amount and at the same time as the participant recognizes income. If the participant makes the election, then any cash dividends the participant receives with respect to the restricted stock will be treated as dividend income to the participant

in the year of payment and will not be deductible by us. The otherwise taxable disposition of the restricted stock (other than by forfeiture) will result in a capital gain or loss. If the participant who has made an election subsequently forfeits the restricted stock, then the participant will not be entitled to claim a credit for the tax previously paid. In addition, we would then be required to include as ordinary income the amount of any deduction we originally claimed with respect to the shares.

     Limits on Deductibility of Compensation

     Section 162(m) of the Internal Revenue Code limits the deduction we can take for compensation paid to our Chief Executive Officer and our four other highest paid officers (determined as of the end of each year) to $1 million per year per individual, subject to certain exemptions. Performance-based compensation that meets the requirements of Section 162(m) does not have to be included in determining whether we have exceeded the $1 million limit. Our Stock Plan is designed and administered so that awards granted to the covered individuals meet the requirements of Section 162(m) for performance-based compensation. Our Corporate Officers Bonus Plan is also designed to provide performance-based compensation, with respect to cash awards. To the extent consistent with the Company’s policies, we seek to preserve the ability to deduct compensation paid to our executive officers under these plans, but the Compensation Committee may pay compensation to one or more executive officers that is as a whole or in part not deductible if the Compensation Committee determines that it is in the best interests of the Company.

     Change of Control; Deferred Compensation

     The SERP has a change of control provision that was clarified by the amendment and restatement of the plan as of January 1, 2009. Upon a change of control, the participants become 100% vested in their benefits, which are calculated based on compensation for the ten years prior to the change of control, and the benefit due is paid out in accordance with the plan.

     In December 2008, the Company adopted a deferred compensation plan, but no executive officer received any benefits under this plan in 2009, other than James D. Hoffman, who received a Company contribution under the plan generally calculated based on the formula applicable under the Earle M. Jorgensen Company plan which was replaced by the Reliance Deferred Compensation Plan. The purpose of the deferred compensation plan is to allow the Company to provide supplemental retirement benefits to participants in the plan and to allow participants to defer compensation to future years to meet their individual financial needs. For Company contributions, participants vest based on Years of Plan Participation at a rate of 20% per Plan Year. Participants vest 100% upon reaching Retirement (age 65 and ten years of service), Change in Control or Death, except that participants in the plan who previously participated in a subsidiary deferred compensation plan will be vested in accordance with a separate vesting schedule that matches the prior plan. Mr. Hoffman is 100% vested in the Company contribution.

COMPENSATION AND STOCK OPTION COMMITTEE REPORT

     The Compensation and Stock Option Committee of the Board of Directors (the “Compensation Committee”) is composed entirely of independent, non-employee directors listed below.

     The Compensation Committee has reviewed the Compensation Discussion and Analysis and has discussed it with management. Based on the review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and, to the extent appropriate, the Company’s Annual Report on Form 10-K.

     This report is submitted on behalf of the members of the Compensation Committee.

Douglas M. Hayes		Mark V. Kaminski

Andrew G. Sharkey, III		Leslie A. Waite, Chairman

EXECUTIVE COMPENSATION

     The following table summarizes certain information concerning the compensation that we paid for the years 2009, 2008 and 2007 to our Chairman and Chief Executive Officer, who was our only principal executive officer during these years, our Executive Vice President and Chief Financial Officer, who was our only principal financial officer during these years, and each of the other four most highly compensated executive officers who were serving in that capacity at the end of 2009:

Summary Compensation Tables

																										Change in
																										Pension Value
																										and
																										Nonqualified
																						Non-Equity				Deferred
														Stock				Option				Incentive Plan				Compensation				All Other
Name and														Awards				Awards				Compensation				Earnings				Compensation				Total
Principal Position		Year				Salary ($)				Bonus ($)(1)				($)(2)				($)(3)				($)(4)				($)(5)				($)(6)				($)
David H. Hannah			2009			$	700,000			$	98,000			$	—			$	1,546,000			$	—			$	846,002			$	20,242			$	3,210,244
Chairman and Chief			2008			$	700,000			$	1,883,000			$	—			$	1,956,000			$	—			$	2,369,595			$	20,529			$	6,929,124
Executive Officer			2007			$	636,000			$	1,710,840			$	—			$	855,500			$	—			$	497,547			$	20,136			$	3,720,023
Gregg J. Mollins			2009			$	520,000			$	72,800			$	—			$	773,000			$	—			$	448,975			$	20,242			$	1,835,017
President and Chief			2008			$	520,000			$	1,398,800			$	—			$	978,000			$	—			$	1,198,902			$	20,529			$	4,116,231
Operating Officer			2007			$	487,600			$	1,311,644			$	—			$	684,400			$	—			$	400,173			$	20,136			$	2,903,953
Karla R. Lewis			2009			$	375,000			$	52,500			$	—			$	618,400			$	—			$	330,421			$	20,242			$	1,396,563
Executive Vice			2008			$	375,000			$	1,008,750			$	—			$	782,400			$	—			$	378,857			$	20,529			$	2,565,536
President and Chief			2007			$	350,000			$	941,500			$	—			$	684,400			$	—			$	76,353			$	20,136			$	2,072,389
Financial Officer
James D. Hoffman(7)			2009			$	330,000			$	46,200			$	—			$	386,500			$	—			$	30,000			$	15,615			$	808,315
Senior Vice			2008			$	321,203			$	762,992			$	—			$	146,700			$	—			$	38,344			$	10,652			$	1,279,891
President, Operations
James P. MacBeth			2009			$	320,000			$	44,800			$	—			$	386,500			$	—			$	354,775			$	20,242			$	1,126,317
Senior Vice			2008			$	320,000			$	860,800			$	—			$	489,000			$	—			$	1,314,652			$	20,529			$	3,004,981
President, Carbon			2007			$	315,000			$	847,350			$	—			$	427,750			$	—			$	595,836			$	20,136			$	2,206,072
Steel Operations
William K. Sales, Jr.			2009			$	330,000			$	46,200			$	—			$	386,500			$	—			$	237,408			$	20,242			$	1,020,350
Senior Vice			2008			$	330,000			$	887,700			$	—			$	489,000			$	—			$	416,840			$	20,529			$	2,144,069
President, Non-			2007			$	315,000			$	847,350			$	—			$	427,750			$	—			$	367,878			$	20,136			$	1,978,114
Ferrous Operations

Grants of Plan Based Awards

     The Company has no non-equity or equity incentive plans for its executive officers other than the Corporate Officers Bonus Plan and the Amended and Restated Stock Option and Restricted Stock Plan as disclosed on the Summary Compensation Table. The following table sets forth plan-based awards granted to the executive officers named above during 2009:

																																		All Other
																																		Option								Grant Date
						Estimated Future Payouts Under Non-												Estimated Future Payouts Under												All Other				Awards:				Exercise or				Fair Value of
						Equity Incentive												Equity												Awards:				Number of				Base Price				Stock and
						Plan Awards(1)												Incentive Plan Awards												Number of				Securities				of Option				Option
		Grant																												Shares of Stock or				Underlying				Awards				Awards
Name		Date				Thres-hold ($)				Target ($)				Maxi-mum ($)				Thres-hold ($)				Target ($)				Maxi-mum ($)				Units (#)				Options (#)(2)				($/sh) (3)				($/sh)(4)
David H. Hannah			—				98,000				700,000				2,100,000				—				—				—				—				100,000			$	33.70			$	15.46
Gregg J. Mollins			—				72,800				520,000				1,560,000				—				—				—				—				50,000			$	33.70			$	15.46
Karla R. Lewis			—				52,500				375,000				1,125,000				—				—				—				—				40,000			$	33.70			$	15.46
James D. Hoffman			—				46,200				330,000				990,000				—				—				—				—				25,000			$	33.70			$	15.46
James P. MacBeth			—				44,800				320,000				960,000				—				—				—				—				25,000			$	33.70			$	15.46
William K. Sales, Jr.			—				46,200				330,000				990,000				—				—				—				—				25,000			$	33.70			$	15.46

Option Exercises and Stock Vested

     The following table sets forth information for the executive officers named above with regard to the aggregate stock options exercised during the year ended December 31, 2009:

		Option Awards								Stock Awards
		Number of Shares								Number of Shares
		Acquired on				Value Realized on				Acquired on
Name		Exercise (#)				Exercise ($)(1)				Vesting (#)				on Vesting ($)
David H. Hannah			50,000			$	811,139				—			$	—
Gregg J. Mollins			—			$	—				—			$	—
Karla R. Lewis			62,500			$	840,947				—			$	—
James D. Hoffman			—			$	—				—			$	—
James P. MacBeth			50,000			$	862,435				—			$	—
William K. Sales, Jr.			—			$	—				—			$	—

Outstanding Equity Awards at Fiscal Year-End

     The following table sets forth outstanding equity awards held by the executive officers named above at December 31, 2009, all of which were granted under the Company’s Amended and Restated Stock Option and Restricted Stock Plan and the Earle M. Jorgensen incentive stock option plan:

		Option Awards																				Stock Awards
										Equity																								Equity
										Incentive																								Incentive
										Plan																				Equity				Plan Awards:
										Awards:																				Incentive Plan				Market or
										Number of												Number				Market				Awards:				Payout Value
						Number of				Securities												of Shares				Value of				Number of				of Unearned
		Number of				Securities				Underlying												or Units				Shares or				Unearned				Shares, Units
		Securities				Underlying				Unexer-												of Stock				Units of				Shares, Units				or Other
		Underlying				Unexercised				cised				Option				Option				That				Stock That				or Other				Rights That
		Options (#)				Options (#)				Unearned				Exercise				Expiration				Have Not				Have Not				Rights That Have				Have Not
Name		Exercisable				Unexercisable(1)				Options(#)				Price ($)				Date				Vested				Vested				Not Vested				Vested
David H. Hannah			50,000				—				—			$	24.58				10/18/2010				—				—				—				—
			25,000				25,000				—			$	44.86				3/2/2014				—				—				—				—
			25,000				75,000				—			$	56.80				2/26/2015				—				—				—				—
			—				100,000				—			$	33.70				4/27/2016				—				—				—				—
Gregg J. Mollins			75,000				—				—			$	24.58				10/18/2010				—				—				—				—
			10,000				20,000				—			$	44.86				3/2/2014				—				—				—				—
			12,500				37,500				—			$	56.80				2/26/2015				—				—				—				—
			—				50,000				—			$	33.70				4/27/2016				—				—				—				—
Karla R. Lewis			37,500				—				—			$	24.58				10/18/2010				—				—				—				—
			20,000				20,000				—			$	44.86				3/2/2014				—				—				—				—
			10,000				30,000				—			$	56.80				2/26/2015				—				—				—				—
			—				40,000				—			$	33.70				4/27/2016				—				—				—				—
James D. Hoffman			12,500				12,500				—			$	44.86				3/2/2014				—				—				—				—

		Option Awards																				Stock Awards
										Equity																								Equity
										Incentive																								Incentive
										Plan																				Equity				Plan Awards:
										Awards:																				Incentive Plan				Market or
										Number of												Number				Market				Awards:				Payout Value
						Number of				Securities												of Shares				Value of				Number of				of Unearned
		Number of				Securities				Underlying												or Units				Shares or				Unearned				Shares, Units
		Securities				Underlying				Unexer												of Stock				Units of				Shares, Units				or Other
		Underlying				Unexercised				cised				Option				Option				That				Stock That				or Other				Rights That
		Options (#)				Options (#)				Unearned				Exercise				Expiration				Have Not				Have Not				Rights That Have				Have Not
Name		Exercisable				Unexercisable(1)				Options(#)				Price ($)				Date				Vested				Vested				Not Vested				Vested
			1,875				5,625				—			$	56.80				2/26/2015				—				—				—				—
			2,676				—				—			$	24.92				6/17/2015				—				—				—				—
			—				25,000				—			$	33.70				4/27/2016				—				—				—				—
James P. MacBeth			50,000				—				—			$	24.58				10/18/2010				—				—				—				—
			12,500				12,500				—			$	44.86				3/2/2014				—				—				—				—
			6,250				18,750				—			$	56.80				2/26/2015				—				—				—				—
			—				25,000				—			$	33.70				4/27/2016				—				—				—				—
William K. Sales, Jr.			100,000				—				—			$	24.58				10/18/2010				—				—				—				—
			12,500				12,500				—			$	44.86				3/2/2014				—				—				—				—
			6,250				18,750				—			$	56.80				2/26/2015				—				—				—				—
			—				25,000				—			$	33.70				4/27/2016				—				—				—				—

						Vesting Schedule For
						Unexercisable Options
Name		Grant Date				2010				2011				2012				2013
David H. Hannah			3/2/2007				12,500				12,500				—				—
			2/26/2008				25,000				25,000				25,000				—
			4/27/2009				25,000				25,000				25,000				25,000
Gregg J. Mollins			3/2/2007				10,000				10,000				—				—
			2/26/2008				12,500				12,500				12,500				—
			4/27/2009				12,500				12,500				12,500				12,500
Karla R. Lewis			3/2/2007				10,000				10,000				—				—
			2/26/2008				10,000				10,000				10,000				—
			4/27/2009				10,000				10,000				10,000				10,000
James D. Hoffman			3/2/2007				6,250				6,250				—				—
			2/26/2008				1,875				1,875				1,875				—
			4/27/2009				6,250				6,250				6,250				6,250
James P. MacBeth			3/2/2007				6,250				6,250				—				—
			2/26/2008				6,250				6,250				6,250				—
			4/27/2009				6,250				6,250				6,250				6,250
William K. Sales, Jr.			3/2/2007				6,250				6,250				—				—
			2/26/2008				6,250				6,250				6,250				—
			4/27/2009				6,250				6,250				6,250				6,250

Stock Option Plans

     In 2004, the Reliance Board of Directors adopted an Incentive and Non-Qualified Stock Option Plan, which was approved by the shareholders in May 2004 (the “2004 Plan”). The Board of Directors authorized 6,000,000 shares of the Company’s common stock to be reserved for issuance upon exercise of stock options granted under the 2004 Plan. On May 17, 2006, as approved by the shareholders on that date, the 2004 Plan was amended and restated to allow the Board to extend the term of subsequently granted stock options to up to 10 years, to increase the number of shares available for future grants of options or restricted stock from 6,000,000 shares to 10,000,000 shares, and to provide for the grant of restricted shares of the Company’s common stock, in addition to or in lieu of stock options. (The 2004 Plan, as amended and restated, may be referred to as the “Stock Plan.”) There are 8,757,000 common shares available for issuance and 3,584,975 options granted and outstanding under the Stock Plan as of December 31, 2009. The Stock Plan provides for granting of stock options that may be either “Incentive Stock Options” within the meaning of Section 422A of the Code or “Non-Qualified Stock Options” which do not satisfy the provisions of Section 422A of the Code. Incentive Stock Options are required to be issued at an option exercise price per share equal to at least the fair market value of a share of common stock on the date of grant, except that the exercise price of options granted to any employee who owns (or, under pertinent Code provisions, is deemed to own) more than 10% of the outstanding common stock must equal at least 110% of fair market value on the date of grant. Non-Qualified Stock Options must be issued at an option exercise price equal to at least fair market value on the date of grant. The Compensation and Stock Option Committee establishes the terms and conditions for the exercise of stock options, which are set forth in the instrument evidencing the stock option. Stock options may be exercised with cash or such other form of payment as may be authorized by the Compensation and Stock Option Committee. Stock options may not be granted more than ten years from the date of the Stock Plan and expire five years from the date of the grant for options granted prior to December 31, 2006 and up to ten years for options granted thereafter, as determined appropriate by the Compensation and Stock Option Committee. Options granted subsequent to December 31, 2006 have terms of seven years. All options granted and outstanding become exercisable at a rate of 25% per year, commencing one year after the date of grant, until fully vested and exercisable. The Stock Plan also allows for restricted shares of the Company’s common stock to be issued, subject to such restrictions as the Compensation and Stock Option Committee may determine to be appropriate. The Stock Plan expires by its terms as of December 31, 2013.

     In February 2010, the Compensation and Stock Option Committee recommended and the independent, non-management directors on the Board of Directors approved the grant of non-qualified options to acquire a total of 1,003,400 shares of the Company’s common stock, of which 240,000 non-qualified stock options were granted to the named executive officers, at an exercise price of $42.81 per share. In April 2009, the Compensation and Stock Option Committee recommended that the independent, non-management directors on the Board approve, which they did, a total grant of non-qualified options to acquire 941,300 shares of the Company’s common stock with an exercise price of $33.70 per share, of which 265,000 of stock options were granted to the named executive officers. All of these stock options have a term of seven years, becoming exercisable at the rate of 25% per year beginning on the first anniversary of the grant.

     In connection with the acquisition of Earle M. Jorgensen Company (“EMJ”), the Company assumed the EMJ incentive stock option plan (“EMJ Plan”) and converted the outstanding EMJ options to options to acquire 287,886 shares of Reliance common stock on the same terms and conditions as were applicable to such options under the EMJ Plan, with adjusted exercise prices and numbers of shares to reflect the difference in the value of the Reliance stock compared with the EMJ stock. Options granted under the EMJ Plan have ten-year terms and became fully vested as of March 31, 2009. There are 32,752 shares available for issuance and 68,254 options granted and outstanding under the EMJ plan as of December 31, 2009. James D. Hoffman, who became an executive officer of Reliance as of October 1, 2008, holds 2,676 of these incentive stock options.

Incentive Bonus Plans

     In February 2008 the Compensation and Stock Option Committee recommended and the independent non-management directors on the Board of Directors approved a Corporate Officers Bonus Plan that is a non-equity incentive bonus plan available to all officers of Reliance, including the named executive officers. The Corporate Officers Bonus Plan is an annual cash incentive payment based on the Company’s performance. The amounts of the bonuses for the named executive officers are the result of a quantitative calculation based on the annual return on beginning shareholders’ equity of the Company (net income for the year, as reported, divided by the shareholders’ equity at the beginning of the year; net income and shareholders’ equity may be adjusted due to certain non-recurring events as determined by the Compensation and Stock Option Committee and approved by the independent directors). The Compensation and Stock Option Committee has more discretion for corporate officers other than the named executive officers to determine annually, based on both qualitative and subjective criteria, what maximum percent of base salary would be paid as a bonus. For the named executive officers, the Compensation Committee has adopted a sliding scale with percentages of base salary corresponding to certain rates of return on beginning shareholders’ equity of the Company. The scale provides for a bonus to be paid to named executive officers if the rate of return on beginning shareholders’ equity is 6% or more, with the corresponding percent of salary ranging from 14% to 300% for 2009 and 12.5% to 300% for 2010. A bonus of 100% of base salary is the target and would be attained if the Company’s rate of return on beginning shareholders’ equity was 12% in 2009 and 13% in 2010. A maximum of 300% of base salary may be attained if the rate of return was 25% or greater.

     Since 1965, we have maintained a Key-Man Incentive Plan for our division managers and, until January 1, 2008, for our corporate officers, with periodic amendments. Most recently, we modified the Key-Man Incentive Plan in January 1999 to more accurately reflect the financial and operational conditions of Reliance and the metals service center industry, and to allocate the incentive bonus pool in accordance with the contributions of the eligible personnel. The initial incentive bonus pool is calculated to equal 20% of the amount by which our net income for that year exceeds the rate of return on a one-year Treasury bill multiplied by our net worth at the beginning of the year, as it may be adjusted for certain significant events, such as the issuance of our common stock in connection with our acquisition of EMJ. That pool is then adjusted by additional calculations, including the accrual of the calculated incentives. Our corporate officers, prior to 2008, were and certain Reliance division managers are eligible to participate in the pool. The incentive compensation bonus is payable 75% in cash and 25% in our common stock, except that corporate officers had the option of having this bonus paid 100% in cash and in 2009 bonuses to division managers were paid 100% in cash. The Company has reserved 147,338 shares of common stock for issuance as restricted stock under the Key-Man Incentive Plan as of December 31, 2009. Bonuses are generally paid and the restricted stock issued in or about March of each year after the Company’s financial results for the prior year have been announced. Officers and division/branch managers of the subsidiaries are not currently eligible to participate under the Key-Man Incentive Plan.

     Our divisions and subsidiaries have separate incentive bonus plans structured to allow them to participate in pretax income if the income exceeds established goals to provide bonuses to certain of the officers and managers, based upon the earnings of the respective subsidiary or division. These bonus plans are reviewed periodically by the executive officers of Reliance and the subsidiary boards of directors. Executive officers who serve as officers of subsidiaries are not eligible to participate in any subsidiary’s bonus plan and receive no other compensation from any subsidiary.

401(k) Retirement Savings Plan

     Various 401(k) and profit sharing plans are maintained by Reliance and its subsidiaries. Effective in 1998, the Reliance Steel & Aluminum Co. Master 401(k) Plan (the “401(k) Plan”) was established, which combined several of the various 401(k) and profit sharing plans of Reliance and its subsidiaries into one plan. Salaried and certain hourly employees of Reliance and its participating subsidiaries are covered under the 401(k) Plan. The 401(k) Plan will continue to allow each subsidiary’s Board to determine

independently the annual matching percentage and maximum compensation limits or annual profit sharing contribution. Eligibility occurs after three months of service, and the Reliance contribution vests at 25% per year, commencing one year after the employee enters the 401(k) Plan. Other 401(k) and profit sharing plans and defined benefit pension plans exist as certain subsidiaries have not yet combined their plans into the 401(k) Plan as of December 31, 2009.

     Reliance also participates in various multi-employer pension plans covering certain employees not covered under our benefit plans pursuant to agreements between Reliance and collective bargaining units who are members of such plans.

Supplemental Executive Retirement Plan and Deferred Compensation Plan

     In 1996, Reliance adopted a Supplemental Executive Retirement Plan (“SERP”), which provides post-retirement benefits to the named executive officers, among others. Under the SERP as adopted and in effect through December 31, 2008, benefits equaled 50% of the average of the participant’s highest five years of the last ten years of total cash compensation, offset by amounts received from the Company contributions to and earnings on the participant’s 401(k) Plan and the ESOP accounts, as well as amounts received through social security. The SERP was amended in 1999 to provide for a pre-retirement death benefit.

     Effective January 1, 2009, the SERP was amended and restated principally to shift the risk of performance of the individual’s retirement plan investments from the Company to the participant. Other objectives were to freeze the SERP to new participants, to bring the documents into compliance with IRS Rule 409A and to clarify certain provisions of the SERP. The most significant change was to eliminate the offsets to the participants’ benefit payments. Under the SERP as amended, benefit payments will equal 38% of the average of the participant’s highest five years of the last ten years of total cash compensation (“Final Average Compensation”), without any deduction. Prior to the amendment, the benefit was calculated as 50% of the average of the participant’s highest five years of the last ten years of total cash compensation, subject to the offsets described above. The new percentage should provide participants with approximately the same benefits that they would have received under the calculation required by the SERP before the amendment. Other changes include paying the pre-retirement death benefit over a period of ten years, making the change of control benefit payable to all participants in a lump sum in the event of a change of control, and a delay in payments for “specified employees” as defined under Rule 409A.

     Reliance also adopted a deferred compensation plan effective December 1, 2008, but no named executive officer participated in or received any contributions under this plan other than James D. Hoffman, who is not a participant in the SERP. Mr. Hoffman received a Company contribution of $38,344 for the 2008 year based on his participation in a subsidiary deferred compensation plan that was replaced by the Reliance Deferred Compensation Plan and a 2009 Company contribution of $30,000. Mr. Hoffman’s aggregate balance in the Reliance Deferred Compensation Plan as of December 31, 2009 was $216,780. Currently no salary deferrals are allowed in the Reliance Deferred Compensation Plan. Aggregate earnings during 2009 in Mr. Hoffman’s deferred compensation account balance were $1,349.

     Certain of our subsidiaries, including PNA and Earle M. Jorgensen Company, had existing change of control agreements and deferred compensation plans at the time of our acquisition. At December 31, 2009, separate SERP’s (for inactive employees only) and a deferred compensation plan exist for certain of the companies that we acquired, which continue to provide post-retirement benefits to certain key employees of each company who were eligible to participate in the plans at the time we acquired the companies. Certain participants of these subsidiary plans entered into agreements to release their rights under those plans and to become participants in the Reliance Deferred Compensation Plan. The Reliance deferred compensation plan is, administered by the Compensation Committee, but the other plans are not.

     The estimated present value of accumulated benefits payable by the SERP at the normal retirement age of 65 for each of the executive officers named above, determined using interest rate and

mortality assumptions consistent with those included in Note 11 in the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009, is as follows:

Pension Benefits

				Number of
				Years
				Credited				Present Value of				Payments
				Service				Accumulated				During the Last
Name		Plan Name		(#)				Benefit ($)				Fiscal Year ($)
David H. Hannah		Supplemental Executive Retirement Plan			29			$	4,737,740			$-0-
Gregg J. Mollins		Supplemental Executive Retirement Plan			23			$	2,607,662			$-0-
Karla R. Lewis		Supplemental Executive Retirement Plan			18			$	709,277			$-0-
James P. MacBeth		Supplemental Executive Retirement Plan			28			$	3,473,638			$-0-
William K. Sales, Jr.		Supplemental Executive Retirement Plan			12			$	1,050,100			$-0-

Employee Stock Ownership Plan

     In 1974, Reliance adopted an Employee Stock Ownership Plan (“ESOP”) that was approved by the Internal Revenue Service as a qualified plan and that allows eligible employees to receive our common stock. All non-union employees, including executive officers, are eligible to participate in the ESOP as of January 1 after one and one-half year’s of service with Reliance. An employee who is eligible to participate is fully vested in the shares of our common stock allocated to his/her ESOP account. Allocation is based on the participant’s compensation each year, including bonuses, as compared to the total compensation of all participants, subject to the maximum compensation amounts established by the Internal Revenue Service ($245,000 for 2009). Dividends on the common stock are passed through and paid directly to the participants. Each year, Reliance contributes to the ESOP an amount determined by the Board of Directors, but no less than that amount necessary to cover the obligations of the ESOP, including any trustee’s fees. Our cash contribution was $1,200,000 for 2009. The cash contribution is used to purchase shares of our common stock on the open market. The shares are retained by the ESOP until a participant retires or otherwise terminates his/her employment with Reliance. Employees of the subsidiaries are not eligible to participate under our ESOP.

Equity Compensation Table

     The following table provides information as of December 31, 2009 regarding shares outstanding and available for issuance under our Amended and Restated Stock Option and Restricted Stock Plan, our Amended and Restated Director Stock Option Plan and the EMJ incentive stock option plan:

Number of Securities

Weighted Average

Number of

to be Issued upon

Exercise Price of

Securities

Exercise of

Outstanding

Remaining

Outstanding Options,

Options, Warrants

Available for

Plan Category

Warrants and Rights

and Rights

Future Issuance

Equity compensation plans approved by security holders

3,809,229

$

41.22

5,421,277

Equity compensation plans not approved by security holders.

—

—

—

Total

3,809,229

$

41.22

5,421,277

Risks Related to Compensation Plans

     Our Compensation and Stock Option Committee has concluded that the Company’s various compensation plans do not encourage excessive or inappropriate risk taking or create any risk that is reasonably likely to have a material adverse effect on the Company.

     Throughout our Company, compensation of our management and key employees is structured with the same elements as for our named executive officers: base salary, incentive cash bonus, equity compensation and a retirement benefit. Sales personnel generally are also paid commissions on the gross profit from sales. Our bonus plans provide variable compensation and are performance based programs triggered by various financial and operational measures, including most commonly return on manageable assets, gross profit, inventory turn, credit performance, safety metrics and other similar performance standards tailored to the job responsibilities of the individual employee and the results of the business unit or subsidiary for which the individual works. These plans generally place a maximum or cap on the amounts payable under the plans, which we believe mitigates excessive risk taking. From time to time discretionary bonuses may be awarded to individual employees based upon that individual’s performance and contribution to the results of the Company as a whole. Any discretionary bonus or commission awarded in connection with a particular transaction would be based principally on the profitability of the transaction and payable on completion. Our senior management reviews compensation paid to division managers, subsidiary officers and key employees and our Compensation and Stock Option Committee and the Board of Directors approves all grants of stock options or restricted stock.

     The nature of our business limits potential risk of the actions of individual employees and individual transactions. Our primary business is to serve customers by providing quick delivery, metals processing and inventory management services, principally for small orders. During 2009, our average order was approximately $1,220. We believe that our focus on small orders with quick turnaround differentiates us from many of the other large metal service center companies and allows us to provide better service to our customers, and that it also mitigates excessive risk taking. It is rare that any of our operating units enters into a material contract or agreement, and, on those rare occasions when a material contract is being considered, senior management is always involved. Further, given the internal processes and controls that we have in place, it would be very difficult for any individual or group of individuals to manipulate the results of their operating unit in a manner that would have a material adverse effect on the Company’s consolidated results.

     By focusing on profitability as one of our principal performance measures, we believe that our key employees are encouraged to reduce risk and to focus on long term objectives. Consequently, we believe that our division and subsidiary management take a more balanced, realistic approach in evaluating any opportunity that arises and avoid excessive risk taking.

DIRECTOR COMPENSATION

     In 2006, the Nominating and Governance Committee engaged an outside consultant to advise the Board on the amount of fees to be paid to non-management directors. After reviewing the recommendation of the consultant and the recommendation of the Nominating and Governance Committee, the Board determined to increase the fees paid to non-management directors effective January 1, 2007. Each non-management director is currently paid an annual retainer of $60,000, paid quarterly, and a fee of $2,500 for attending each Board or Committee meeting in person or any meeting of the non-management directors held on a day other than the day of a regular Board meeting and $1,250 for each meeting in which they participate by conference telephone call. In addition, the Company pays the Audit Committee Chair an annual retainer of $20,000, the Compensation and Stock Option Committee Chair an annual retainer of $10,000, the Nominating and Governance Committee Chair an annual retainer of $10,000, and a $15,000 annual retainer to the Lead Director who chairs the non-management Board meetings, all of which fees are paid quarterly. Mr. Hannah, who was elevated to the position of Chairman in October 2007, does not receive an annual retainer or other fees for his service as Chairman and as a director. All directors are reimbursed for expenses incurred in connection with Board or Committee meetings.

     In May 1998, the shareholders approved the Directors Stock Option Plan for non-employee directors. There were 600,000 shares of our common stock reserved for issuance under the Directors Plan initially. In February 1999, the Directors Plan was amended to authorize the Board of Directors of Reliance to grant additional options to acquire our common stock to non-employee directors. In May 2004 the Directors Plan was amended to accelerate the vesting of a non-employee director’s unexpired stock options in the event that such an individual retires from the Board of Directors at or after the age of 75, so that any unexpired stock options granted under the Directors Plan become immediately vested and exercisable, and the director, if he or she so desires, must exercise those options within ninety (90) days after such retirement or the options shall expire automatically. Options under the Directors Plan are non-qualified stock options, with an exercise price equal to fair market value at the date of grant. All options granted prior to May 2005 expire five years from the date of grant. None of the stock options becomes exercisable until one year after the date of the grant, unless specifically approved by the Board of Directors. In each of the following four years, 25% of the options become exercisable on a cumulative basis.

     In May 2005 the Directors Plan was further amended to provide for automatic annual grants of options to acquire 6,000 shares of common stock to each non-employee director. These options become 100% exercisable after one year. Once exercisable, the options remain exercisable until that date which is ten years after the date of grant. In addition, the amendment increased the number of shares available for future grants of options from the 374,000 shares reserved as of May 2005 to 500,000 shares. As of December 31, 2009 there were 215,000 shares available for issuance and 156,000 options outstanding under the Directors Plan.

     In February 2007, the Board of Directors adopted minimum requirements for directors to own the Company’s common stock. Directors are required to own shares of the Company’s common stock having a market value equal to at least five times the annual cash retainer received by directors, and directors have five years in which to acquire and begin maintaining that amount of the Company’s common stock. Andrew G. Sharkey, III, our newest director, is the only director who has not yet met this requirement.

Director Summary Compensation Table

     The following table sets forth certain information regarding fees paid and expense for outstanding options under the Directors Plan during 2009:

																		Change in
																		Pension Value
																		and
		Fees Earned												Non-Equity				Nonqualified
		or Paid in				Stock				Option				Incentive Plan				Deferred				All Other
Name		Cash				Awards				Awards(1) (2)				Compensation				Compensation				Compensation				Total
Thomas W. Gimbel		$	88,750			$	—			$	112,440			$	—				N/A				N/A			$	201,190
Douglas M. Hayes		$	126,750			$	—			$	112,440			$	—				N/A				N/A			$	239,190
Franklin R. Johnson		$	128,750			$	—			$	112,440			$	—				N/A				N/A			$	241,190
Mark V. Kaminski		$	126,250			$	—			$	112,440			$	—				N/A				N/A			$	238,690
Andrew G. Sharkey, III		$	97,500			$	—			$	112,440			$	—				N/A				N/A			$	209,940
Leslie A. Waite		$	120,000			$	—			$	112,440			$	—				N/A				N/A			$	232,440

		Grant Date Per Share				Number of Options
Director		Fair Value				Outstanding
Thomas W. Gimbel		$	6.44				6,000
		$	15.79				6,000
		$	25.24				6,000
		$	25.54				6,000
		$	18.74				6,000
Douglas M. Hayes		$	6.44				6,000
		$	15.79				6,000
		$	25.24				6,000
		$	25.54				6,000
		$	18.74				6,000
Franklin R. Johnson		$	15.79				6,000
		$	25.24				6,000
		$	25.54				6,000
		$	18.74				6,000
Mark V. Kaminski		$	6.44				6,000
		$	15.79				6,000
		$	25.24				6,000
		$	25.54				6,000
		$	18.74				6,000
Andrew G. Sharkey, III		$	25.54				6,000
		$	18.74				6,000
Leslie A. Waite		$	6.44				6,000
		$	15.79				6,000
		$	25.24				6,000
		$	25.54				6,000
		$	18.74				6,000

SECURITIES OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth certain information as of January 31, 2010, with respect to the beneficial ownership of our common stock by (i) each person known to Reliance who owns beneficially or of record more than five percent (5%) of the common stock of Reliance, (ii) each director and each executive officer named in the Summary Compensation Table and (iii) all directors and executive officers as a group:

		Amount and
		Nature of				Percentage of
Name and Address		Beneficial				Outstanding
of Beneficial Owner(1)		Ownership(2)				Shares Owned
Lord, Abbett & Co. LLC 90 Hudson Street Jersey City, NJ 07302			5,990,429	(3)			8.12	%
BlackRock Inc. 40 East 52nd Street New York, NY 10022			5,701,953	(4)			7.73	%
Royce & Associates, LLC 745 Fifth Avenue New York, NY 10151			5,335,083	(5)			7.23	%
Thomas W. Gimbel, Trustee of Florence A. Neilan Trust dated August 1, 2006 2670 Lorain Rd. San Marino, CA 91108			3,442,116	(6)			4.66	%
David H. Hannah			387,500	(7)			*
Douglas M. Hayes 2545 Roscomare Rd. Los Angeles, CA 90077			43,195	(8)			*
Franklin R. Johnson 350 South Grand Avenue, Suite 4800 Los Angeles, CA 90071			23,000	(9)			*
Mark V. Kaminski 3521 Winterberry Circle Louisville, KY 40207			44,000	(10)			*
Gregg J. Mollins			272,682	(11)			*
Andrew G. Sharkey, III 10106 Harewood Court Great Falls, VA 22066			12,568	(12)			*
Leslie A. Waite 55 South Lake Street, Suite 750 Pasadena, CA 91101			142,812	(13)			*
James D. Hoffman			29,975	(14)			*
Karla R. Lewis			122,436	(15)			*
James P. MacBeth			139,329	(16)			*
William K. Sales, Jr.			179,008	(17)			*
All directors and executive officers as a group (15 persons)			4,936,135	(18)			6.69	%