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SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
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<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
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BIRMINGHAM STEEL CORPORATION
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(Name of Registrant as Specified In Its Charter)
THE UNITED COMPANY SHAREHOLDER GROUP
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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UNITED COMPANY SHAREHOLDER GROUP SENDS LETTER TO BIRMINGHAM STEEL BOARD OF
DIRECTORS
Bristol, Va. - Nov. 29, 1999 - [NYSE: BIR] - The United Company Shareholder
Group today said it sent the following letter to the Board of Directors of
Birmingham Steel.
November 29, 1999
Board of Directors
Birmingham Steel Corporation
1000 Urban Center Drive
Birmingham, Alabama 35242
RE: BIRMINGHAM STEEL CORPORATION
Gentlemen:
We are writing to reply to your letter of November 28, 1999 and
dialogue between our respective representatives on November 26-28 to state our
position with respect to the issues discussed. We continue to be willing to meet
with representatives of the Board of Directors ("BOARD") of Birmingham Steel
Corporation ("BIR") to the extent there is any realistic possibility of a
meaningful compromise.
The only conditions we imposed on a meeting were that the BOARD be
willing to replace a majority of the existing BOARD with nominees appointed by
the United Group and that Mr. Garvey be replaced by John Correnti as Chief
Executive Officer and Chairman of the Board. Your letter stated that we had two
conditions required in order to conduct a meeting, one of which was modification
of the Executive Severance Plan.
We continue to be appalled at the 50% increase in the Executive
Severance Plan as well as modifications to certain long term employment
contracts and the granting of additional long term employment contracts when BIR
was in default on its loan agreements and when the BOARD had voted to implement
a restructuring that caused an almost 50% reduction in shareholder value.
Although we have advised you that we have not agreed to accept the September
modifications to the Executive Severance Plan as binding on BIR, we did not make
the modification of that plan a condition to our willingness to meet.
The purpose of our proxy solicitation has been to remove Mr. Garvey as
Chairman and CEO and replace him with John Correnti and to provide Mr. Correnti
with a Board of Directors, a majority of whom are solidly behind his vision for
BIR. We cannot accept anything short of this
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November 29, 1999
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goal. On November 28, 1999, representatives of the BOARD stated that the BOARD
could not accept this condition. We, therefore, doubt that a meeting at this
time would be productive.
It is also our understanding that you have proposed that the BOARD may
be willing to offer shareholders alternative slates, one consisting of the
current BOARD and the other consisting of those proposed by the United Group. If
this proposal were accepted, the goal would be to allow for the election of the
BOARD chosen by the shareholders. It is our understanding, however, that any
such arrangement would require: (i) a significant delay in the date of the
shareholder meeting in order to re-circulate shareholder information and
proxies, (ii) that the United Group agree to abandon its efforts to obtain
proxies to replace the BOARD by consent action, (iii) that the United Group
agree to accept the terms of the Executive Severance Plan as modified in
September, without challenge, and (iv) that the United Group agree not to pursue
any action against current BOARD members in the event that the United Group
determines that actions taken or approved by the current BOARD were in breach of
their obligations to BIR, its shareholders, or a violation of the securities
laws.
We believe that the conditions you have placed on this proposal are not
acceptable. BIR cannot afford any further delay. We believe that new management
must be put into place immediately in order to improve operations and begin the
process of rebuilding BIR. We, therefore, intend to continue on our current
course to pursue obtaining proxies to replace the BOARD by written consent, and
if we are not successful then to replace the BOARD at the December 2, 1999
scheduled annual meeting. We believe that the conditions proposed by the BOARD
are not in the best interests of the shareholders.
We have been consistent in our willingness to discuss with the BOARD
any alternative that would result in Mr. Correnti being named as Chairman and
Chief Executive Officer with a majority BOARD fully in support of him, and we
have been disappointed to learn that in spite of your earlier indications that
all matters are on the table for discussion, you have never been willing to
seriously discuss replacing Mr. Garvey with Mr. Correnti or replacing a majority
of the BOARD with directors who would support Mr. Correnti. We remain willing to
meet with representatives of the BOARD if the BOARD is willing to meet this
single condition. We are aware that because of the escalating verbal battle
between the competing parties in this proxy contest some or all of the current
directors of BIR may not be interested in serving on the BOARD with the United
Company's nominees, but it is still possible for the existing BOARD to act in
the interests of the shareholders by electing the slate proposed by the United
Group prior to the annual meeting.
As always, the interests of the United Group continue to be to enhance
shareholder value and to act in the best interests of the shareholders of BIR.
If the BOARD is willing to seriously discuss and act upon a compromise that
would result in Mr. Correnti being named as Chairman and Chief Executive Officer
with a Board of Directors that supports him, we would be delighted
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November 29, 1999
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to meet with you to discuss such a proposal.
Sincerely yours,
The United Company Shareholder Group
Contact: The United Company Shareholder Group - (205) 458-5357
