<PAGE>
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:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Valmont Industries, Inc.
........................................................................
(Name of Registrant as Specified In Its Charter)
Terry J. McClain
........................................................................
(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:
....................................................................
2) Aggregate number of securities to which transaction applies:
....................................................................
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):
....................................................................
4) Proposed maximum aggregate value of transaction:
....................................................................
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] 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:
....................................................................
2) Form, Schedule or Registration Statement No.:
....................................................................
3) Filing Party:
....................................................................
4) Date Filed
....................................................................
<PAGE>
PROXY STATEMENT
FOR THE
APRIL 26, 2000
ANNUAL SHAREHOLDERS' MEETING
Dear Shareholder:
You are cordially invited to attend Valmont's Annual Meeting of
Shareholders on April 26, 2000 at 2:00 P.M. The meeting wi4ll be held in the
Lecture Hall of the Joslyn Art Museum at 2200 Dodge Street in Omaha. You may
enter the building through the atrium entrance on the east side.
The formal meeting of Shareholders will be followed by a review of
Valmont's business operations for 1999 and the first quarter of 2000, as well as
our outlook for the future. Following the meeting, you are invited to an
informal reception where you can visit with the Directors and Officers about the
activities of the Company.
If you cannot attend the meeting in person, please vote your shares by
proxy. Please complete, sign and date the enclosed proxy card and return it in
the postage paid envelope. Your prompt return of the card will help your Company
avoid additional solicitation costs. Your vote is important, either in person or
by proxy.
I look forward to seeing you at our Annual Meeting.
Sincerely,
/s/ Mogens C. Bay
Mogens C. Bay
Chairman and Chief Executive Officer
<PAGE>
VALMONT INDUSTRIES, INC.
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
Notice is hereby given that the Annual Meeting of Shareholders of
Valmont Industries, Inc., a Delaware corporation, will be held at the Joslyn Art
Museum, 2200 Dodge St., Omaha, Nebraska 68102, on Wednesday, April 26, 2000 at
2:00 p.m. local time for the purpose of:
(1) Electing three directors of the Company to three year terms.
(2) Ratifying the appointment of Deloitte & Touche LLP as independent
accountants for fiscal 2000.
(3) Transacting such other business as may properly come before the
meeting.
Shareholders of record at the close of business on March 3, 2000 are
entitled to vote at this meeting. If you do not expect to be present at the
Annual Meeting and wish your shares to be voted, please complete, sign, date and
mail the enclosed proxy form.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Thomas P. Egan, Jr.
Thomas P. Egan, Jr.
Secretary
Omaha, Nebraska 68154
March 24, 2000
2
<PAGE>
PROXY STATEMENT
To Our Shareholders:
The Board of Directors of Valmont Industries, Inc. solicits your proxy
in the form enclosed for use at the Annual Meeting of Shareholders to be held on
Wednesday, April 26, 2000, or at any adjournments thereof.
At the close of business on March 3, 2000, the record date for
shareholders entitled to notice of and to vote at the meeting, there were
outstanding 23,316,298 shares of the Company's common stock. There were no
preferred shares outstanding. All holders of common stock are entitled to one
vote for each share of stock held by them.
Shares of common stock represented by a properly signed and returned
proxy, including shares represented by broker non-votes or abstaining from
voting, will be treated as present at the meeting for the purpose of determining
a quorum. Directors are elected by a favorable vote of a plurality of the shares
of voting stock present and entitled to vote, in person or by proxy, at the
Annual Meeting. Accordingly, abstentions or broker non-votes will not affect the
election of Directors.
The proposal to ratify the appointment of the accountants requires the
affirmative vote of a majority of shares present in person or represented by
proxy. Abstentions will have the same effect as a vote against this proposal.
Broker non-votes on this proposal are treated as shares for which voting power
has been withheld by the beneficial holders of those shares and therefore will
not be counted as votes for or against this proposal.
Any shareholder giving a proxy may revoke it before the meeting by
mailing a signed instrument revoking the proxy to: Corporate Secretary, Valmont
Industries, Inc., One Valmont Plaza, Omaha, Nebraska 68154-5215. To be
effective, the revocation must be received by the Secretary before the date of
the meeting. A shareholder may attend the meeting in person and at that time
withdraw the proxy and vote in person.
The cost of solicitation of proxies, including the cost of reimbursing
banks and brokers for forwarding proxies and proxy statements to their
principals, shall be borne by the Company. This proxy statement and proxy card
are being mailed to shareholders on or about March 24, 2000.
3
<PAGE>
CERTAIN SHAREHOLDERS
The following table sets forth, as of March 3, 2000, the number of
shares beneficially owned by (i) persons known to the Company to be beneficial
owners of more than 5% of the Company's outstanding common stock, (ii) directors
and named executive officers and (iii) all directors and executive officers as a
group.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME AND ADDRESS OF OF BENEFICIAL OWNERSHIP PERCENT
BENEFICIAL OWNER MARCH 3, 2000 (1) OF CLASS (2)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Robert B. Daugherty 7,119,568 30.5%
Ocean Reef
Key Largo, FL 33037
Shapiro Capital Management Company, Inc. (3) 2,435,591 10.4%
3060 Peachtree Road, N.W.
Atlanta, GA 30305
Mogens C. Bay 707,893 3.0%
Charles M. Harper 104,000
John E. Jones 38,000
Thomas F. Madison 53,230
Charles D. Peebler, Jr. 25,000
Bruce Rohde 26,000
Walter Scott, Jr. 80,000
Kenneth E. Stinson 40,000
Vincent T. Corso 81,101
Thomas P. Egan, Jr. 98,641
Terry J. McClain 178,767
E. Robert Meaney 79,343
All Executive Officers and Directors
As Group (15 persons) 8,934,656 38.3%
</TABLE>
(1) Includes shares which the directors and executive officers have, or within
60 days of March 3, 2000 will have, the right to acquire through the
exercise of stock options, as follows: 12,000 shares each for Messrs.
Daugherty and Stinson; 20,000 shares each for Messrs. Harper, Jones,
Madison and Scott; and 4,000 shares each for Messrs. Peebler and Rohde; and
413,335, 57,334, 36,001, 66,489 and 41,863 shares for Messrs. Bay, Corso,
Egan, McClain and Meaney respectively; and 774,121 shares for all executive
officers and directors as a group.
(2) Unless otherwise indicated, beneficial ownership of any named individual
does not exceed 1% of the outstanding shares common stock.
(3) This information is based on a Schedule 13G filed with the Securities and
Exchange Commission in February 2000.
4
<PAGE>
ELECTION OF DIRECTORS
The Company's Board of Directors currently consists of nine members.
Mr. Harper is retiring as a Director effective with the 2000 Annual Meeting of
Shareholders. Consequently, following the 2000 Annual Meeting of Shareholders,
the Company's Board of Directors will be composed of eight members, divided into
three classes. Each class serves for three years on a staggered term basis. Of
the Directors of the Company, only Mr. Bay is an employee of the Company.
Three Directors have terms of office that expire at the 2000 Annual
Meeting. They have been nominated by the Board of Directors for re-election to
three-year terms. These nominees are:
Robert B. Daugherty
Charles D. Peebler, Jr.
Kenneth E. Stinson
Unless authority to vote for directors is withheld, the shares
represented by the enclosed proxy will be voted for the election of the nominees
named above. In the event any of such nominees becomes unavailable for election,
the proxy holders will have discretionary authority to vote the proxies for a
substitute. The Board of Directors has no reason to believe that any such
nominee will be unavailable to serve.
NOMINEES FOR ELECTION - TERMS EXPIRE 2003:
ROBERT B. DAUGHERTY, Age 78, Chairman Emeritus of the Company since December
1996; Chairman of the Board of the Company from March 1947 to December 1996.
Served as Director of Company continuously since March 1947.
Valmont Stock: 7,119,568 shares
CHARLES D. PEEBLER, JR., Age 63, Chairman Emeritus of True North Communications,
Inc. since May 1999 and Managing Director of Plum Holdings, L.P. Previously,
President of True North Communications, Inc. and Chairman and Chief Executive
Officer of True North Diversified Companies; Director, American Tool Companies,
Inc., DreamLife, Inc., True North Communications, Inc., and Youbet.com, Inc.
Served as Director of Company continuously since February 1999.
Valmont Stock: 25,000 shares
KENNETH E. STINSON, Age 57 , Chairman and Chief Executive Officer of Peter
Kiewit Sons', Inc. since March 1998. Chairman and Chief Executive Officer of
Kiewit Construction Group, Inc. from April 1994 to March 1998. Director,
ConAgra, Inc., Level 3 Communications, Inc. and Peter Kiewit Sons', Inc.
Served as Director of Company continuously since December 1996.
Valmont Stock: 40,000 shares
5
<PAGE>
CONTINUING DIRECTORS - TERMS EXPIRE 2002:
MOGENS C. BAY, Age 51, Chairman and Chief Executive Officer of the Company since
January 1997. President and Chief Executive Officer of the Company from August
1993 to December 1996. Director, ConAgra, Inc. and Peter Kiewit Sons', Inc.
Served as Director of Company continuously since October 1993.
Valmont Stock: 707,893 shares
JOHN E. JONES, Age 65, Retired Chairman, President and Chief Executive Officer
of CBI Industries, Inc. Director, Allied Products Corporation, Amsted Industries
Incorporated, NICOR Inc. and BWAY Corp.
Served as Director of Company continuously since April 1993.
Valmont Stock: 38,000 shares
WALTER SCOTT, JR., Age 68, Chairman of Level 3 Communications, Inc. since March
1998. Previously, Chairman of the Board and President of Peter Kiewit Sons',
Inc. Director, Berkshire Hathaway, Inc., Commonwealth Telephone Enterprises,
Inc., ConAgra, Inc., Level 3 Communications, Inc., MidAmerican Energy Holdings
Company, Peter Kiewit Sons', Inc., and RCN Corporation.
Served as Director of Company continuously since April 1981.
Valmont Stock: 80,000 shares
CONTINUING DIRECTORS - TERMS EXPIRE 2001:
THOMAS F. MADISON, Age 64, President of MLM Partners since January 1993;
Chairman of Communications Holdings, Inc. since September 1996. Previously,
President - Markets of U S WEST Communications and Vice Chairman and Office of
CEO of Minnesota Mutual Life Insurance Company; Director, ACI Telecentrics, Aon
Insurance Advisory Board, Communications Holdings, Inc., Delaware Group of
Mutual Funds, Digital River, Inc., LHS Health Systems, Minnegasco Advisory
Board, and Span Link.
Served as Director of Company continuously since June 1987.
Valmont Stock: 53,230 shares
BRUCE ROHDE, Age 51, Chairman and CEO of ConAgra, Inc. since September 1998.
President, Vice Chairman and Chief Executive Officer of ConAgra, Inc. from
September 1997 to September 1998. President and Vice Chairman of ConAgra, Inc.
from August 1996 to September 1997. Previously, President of McGrath, North,
Mullin & Kratz, P.C. Director, ConAgra, Inc.
Served as Director of Company continuously since February 1999.
Valmont Stock: 36,000 shares
6
<PAGE>
(1) Messrs. Harper (Chairman), Madison and Peebler were members of the
Compensation Committee which met two times during 1999. The Compensation
Committee, composed of directors who are not employees of the Company,
directs the administration of various management incentive plans; takes
action upon or makes recommendations to the Board of Directors on salary
changes for certain key management personnel; and takes action upon or
makes recommendations to the Board of Directors concerning certain employee
benefit plan matters.
Messrs. Scott (Chairman), Jones and Stinson were members of the Audit
Committee which met three times during the last fiscal year. The Audit
Committee, composed of directors who are not employees of the Company,
assists the Board by reviewing (1) the financial statements of the Company,
(2) the independence and performance of the Company's independent auditors,
and (3) the compliance by the Company with legal and regulatory
requirements. The Audit Committee also recommends selection of the
independent auditors; reviews matters pertaining to the audit, systems of
internal control and accounting policies and procedures; has approval
authority with respect to services provided by the independent auditors;
and directs and supervises investigations into matters within the scope of
its duties.
The Company does not have a standing Nominating Committee.
(2) The Board of Directors held five meetings during the last fiscal year.
During 1999, non-employee directors were paid an annual fee of $25,000 plus
$2,000 for each board meeting and $1,000 for each committee meeting
attended. Committee chairmen receive an additional $6,000 per year. Messrs.
Harper, Jones, Peebler and Scott have elected to receive their fees in the
form of deferred compensation. The deferred fees accrue interest indexed to
U.S. Government bonds, compounded monthly. Mr. Bay does not receive
director or meeting fees.
(3) Pursuant to the stockholder approved 1999 Stock Plan, each non-employee
director receives (i) an annual award of 2,000 shares of common stock of
the company and (ii) an annual award of a nonqualified stock option for
4,000 shares of common stock exercisable at the fair market value of the
Company's common stock on the date of grant. These awards are made annually
on the date of and following completion of Valmont's Annual Shareholders'
Meeting. The common stock award will be forfeited if the director's
services terminate for any reason other than death, retirement from the
board at the mandatory retirement age, or resignation or failure to stand
for re-election, in any such case without the prior approval of the board.
(4) See "Certain Shareholders" for additional information on stock ownership.
7
<PAGE>
EXECUTIVE COMPENSATION
The following Summary Compensation Table provides information on the
annual and long-term compensation for services paid by the Company to the Chief
Executive Officer and the four highest paid executive officers for the three
fiscal years ended December 25, 1999.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
------------------- ----------------------
Awards Payouts All
------ ------- ---
Name and Number of LTIP Other
Principal Position Year Salary ($) Bonus ($) Options (#) Payouts ($) Comp. ($) (1)
------------------ ---- ---------- --------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mogens C. Bay 1999 624,000 661,600 200,000 0 70,683
Chairman and 1998 600,461 0 100,000 231,407 37,434
Chief Executive Officer 1997 551,923 368,086 100,000 755,630 114,238
Vincent T. Corso 1999 275,000 281,250 60,000 0 30,013
Sr. Vice President and 1998 234,615 15,743 60,000 57,096 13,835
Chief Operating Officer 1997 205,769 150,622 30,000 168,758 33,287
Terry J. McClain 1999 229,900 222,425 50,000 0 24,660
Sr. Vice President and 1998 220,190 0 50,000 57,096 12,478
Chief Financial Officer 1997 200,769 131,238 30,000 191,777 36,083
E. Robert Meaney 1999 218,400 163,800 20,000 0 21,447
Sr. Vice President - 1998 210,162 0 20,000 64,810 12,374
International 1997 210,000 24,890 10,000 230,119 30,227
Thomas P. Egan, Jr. 1999 179,322 107,593 5,000 0 16,203
Vice President, Corporate 1998 171,749 0 4,000 40,113 9,534
Counsel and Secretary 1997 165,254 53,617 4,000 111,180 22,403
</TABLE>
(1) Amounts represent the Company's contribution under the Valmont Employee
Retirement Savings Plan and related Restoration Plan.
8
<PAGE>
STOCK OPTION GRANTS IN FISCAL YEAR 1999
The following table provides information on 1999 stock option grants to
executive officers named in the Summary Compensation Table. No stock
appreciation rights were granted during fiscal 1999.
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates of
Stock Price Appreciation
Individual Grants for Option Term (3)
- ----------------------------------------------------------------------- -----------------
% of Total
Options
Granted to Exercise
Date Options Employees In Price ($) Expiration
Name Granted Granted Fiscal Year Per Share Date 5% ($) 10% ($)
---- ------- ------- ----------- --------- ---- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
Mogens C. Bay (1) 2/23/99 100,000 12.1% 12.9375 2/22/09 813,632 2,061,904
Mogens C. Bay (1) 12/13/99 100,000 12.1% 16.6880 12/12/09 1,049,136 2,658,507
Vincent T. Corso (1) 12/13/99 60,000 7.3% 16.6880 12/12/09 629,482 1,595,104
Terry J. McClain (1) 12/13/99 50,000 6.0% 16.6880 12/12/09 524,568 1,329,254
E. Robert Meaney (2) 5/18/99 5,465 0.7% 16.3750 12/19/05 33,932 78,202
E. Robert Meaney (2) 5/18/99 3,717 0.5% 16.3750 2/29/04 16,010 35,183
E. Robert Meaney (1) 12/13/99 20,000 2.4% 16.6880 12/12/09 209,827 531,701
Thomas P. Egan, Jr. (2) 5/18/99 1,505 0.2% 16.3750 12/17/99 712 1,410
Thomas P. Egan, Jr. (1) 12/13/99 5,000 0.6% 16.6880 12/12/09 52,457 132,925
- -------------------------------------------------------------------------------------------------------------------
All Shares Outstanding (4) 245,105,295 621,144,941
</TABLE>
(1) Options become exercisable in three equal annual installments commencing on
the first anniversary of the grant, or on the fifth anniversary of the
grant.
(2) Replacement options become exercisable six months following the grant.
These options were issued pursuant to the 1988 and 1996 Stock Plans upon
stock-for-stock option exercises as reflected in the Options Exercised
table on page 10.
(3) Potential realizable value is based on the assumption that the common stock
price appreciates at the annual rate shown (compounded annually) from the
date of grant until the end of the option term. The numbers are calculated
based on the requirements promulgated by the Securities and Exchange
Commission. The actual value, if any, an executive may realize will depend
on the excess of the stock price over the exercise price on the date the
option is exercised (if the executive were to sell the shares on the date
of exercise) so there is no assurance that the value realized will be at or
near the potential realizable value as calculated in this table.
(4) All shares outstanding represent the increase in total Company shareholder
value if the stock price and assumed rates used in the stock option
assumptions are achieved over a ten year option period multiplied by the
number of shares outstanding at the end of fiscal 1999 (23,354,497).
9
<PAGE>
OPTIONS EXERCISED IN FISCAL YEAR 1999 AND FISCAL YEAR END VALUES
The following table provides information on the exercise of stock
options during fiscal 1999 and the status of unexercised stock options at the
end of the year for the executive officers named in the Summary Compensation
Table.
<TABLE>
<CAPTION>
Value of Unexercised
Number of Unexercised In-The-Money Options
Shares Options at FY-End (#) at FY-End ($) (2)
Acquired On Value --------------------- -----------------
Exercise (#) Realized ($)(1) Exercisable Unexercisable Exercisable Unexercisable
------------ --------------- ------------ ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mogens C. Bay 3,846 5,531 380,001 399,999 1,645,000 268,750
Vincent T. Corso 0 0 57,334 151,666 190,003 27,497
Terry J. McClain 0 0 66,489 118,333 34,837 0
E. Robert Meaney 11,905 67,977 38,530 43,999 0 21,664
Thomas P. Egan, Jr. 2,667 29,004 36,001 13,999 186,000 0
</TABLE>
(1) Value realized is the difference between the closing price of the Company's
Common Stock on the day of exercise and the option exercise price
multiplied by the number of shares.
(2) Value is the difference between the closing price of the Company's Common
Stock on the last trading day of fiscal 1999 and the option exercise price
of the in-the-money options multiplied by the number of in-the-money
options.
LONG-TERM INCENTIVE PLANS - AWARDS IN FISCAL YEAR 1999
The following table provides information on the long-term incentive program
awards granted to the executive officers named in the Summary Compensation Table
during fiscal year 1999.
<TABLE>
<CAPTION>
Performance Estimated Future Payouts under
Number Of or Other Non-Stock Price-Based Plans
Shares, Units Period Until ---------------------------
or Other Maturation or Threshold Target Maximum
Rights (#) Payout ($) ($) ($)
---------- ------ --- --- ---
<S> <C> <C> <C> <C> <C>
Mogens C. Bay 1 Unit (1) 140,400 280,800 617,760
Mogens C. Bay 1 Unit (2) 140,400 280,800 617,760
Vincent T. Corso 1 Unit (1) 41,250 82,500 181,500
Vincent T. Corso 1 Unit (2) 41,250 82,500 181,500
Terry J. McClain 1 Unit (1) 34,485 68,970 151,734
Terry J. McClain 1 Unit (2) 34,485 68,970 151,734
E. Robert Meaney 1 Unit (1) 32,760 65,520 144,144
E. Robert Meaney 1 Unit (2) 32,760 65,520 144,144
Thomas P. Egan, Jr. 1 Unit (1) 21,450 42,900 94,380
Thomas P. Egan, Jr. 1 Unit (2) 21,450 42,900 94,380
</TABLE>
(1) Awards are for the two-year award cycle ending in 2000.
(2) Awards are for the three-year cycle ending in 2001.
See "Compensation Committee Report on Executive Compensation - Long-Term
Performance Incentives" for a description of the award program.
10
<PAGE>
COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
Valmont's executive compensation policies and practices are approved by
the Compensation Committee of the Board of Directors (the "Committee"). The
Committee during 1999 consisted of three Directors who are not employees of the
Company. The Committee's determinations on compensation of the Chief Executive
Officer and other executive officers are reviewed with the Board of Directors.
The Committee has implemented compensation policies, plans and programs
which seek to enhance shareholder value by aligning the financial interests of
the executive officers with those of the Company's shareholders. Annual base
salaries are generally set at competitive median levels. The Company relies on
annual and long-term incentive compensation and stock options to attract,
retain, motivate and reward executive officers and other key employees.
Incentive compensation is variable and tied to corporate, business unit and
individual performance. The plans are designed to provide an incentive to
management to grow earnings, provide quality returns on investment, enhance
shareholder value and contribute to the long-term growth of the Company. All
incentive compensation plans are reviewed at least annually to assure their
linkage to the current strategies and needs of the business. The Company's
programs have been designed so that compensation paid to named executive
officers in 1999 will be deductible under the Internal Revenue Code's
compensation limits for deductibility.
Valmont's executive compensation is based on four components, each of
which is intended to support the overall compensation philosophy.
BASE SALARY. Base salary is targeted at the median level for industrial
manufacturing companies of similar characteristics such as sales volume,
capitalization and financial performance. Salaries for executive officers are
reviewed by the Committee on an annual basis and may be changed based on the
individual's performance or a change in competitive pay levels in the
marketplace.
The Committee reviews with the Chief Executive Officer an annual salary
plan for the Company's executive officers (other than the Chief Executive
Officer). The salary plan is modified as deemed appropriate and approved by the
Committee. The annual salary plan is developed by the Company's human resources
staff under the ultimate direction of the Chief Executive Officer based on peer
group and national surveys of industrial manufacturing organizations with
similar characteristics and on performance judgments as to the past and expected
future contributions of the individual executive. In addition, the Committee
annually reviews information provided by independent compensation consultants
concerning salary competitiveness. The Committee reviews and establishes the
base salary of the Chief Executive Officer based on similar competitive
compensation data and the Committee's assessment of his past performance, his
leadership in establishing performance standards in the conduct of the Company's
business, and its expectation as to his future contributions in directing the
long-term success of the Company and its businesses.
11
<PAGE>
The Committee increased the Chief Executive Officer's salary in
December 1999 to the current level of $650,000 per year. The salary increase
reflected the Committee's desire to reward Mr. Bay for his performance in
managing the Company in 1999 and his contribution to the Company's performance.
ANNUAL INCENTIVES. The Company's short-term incentives are paid
pursuant to programs established under the stockholder approved Executive
Incentive Plan. The Committee believes that the annual bonus of key employees,
including executive officers, should be based on optimizing profits and prudent
management of the capital employed in the business. Accordingly, the programs
provide for target performance levels based upon the Company's earnings per
share or the respective business unit's net operating income after tax less a
cost of capital. A minimum threshold level must be met before any awards are
earned. Individual award targets are based on a pre-determined percentage of
beginning of year base salary considering the individual's position and the
Committee's assessment of the individual's expected contribution in such
position. Participants, thresholds and specific performance levels are
established by the Committee at the beginning of each fiscal year.
The Committee approved participation including six executive officers
in the programs for 1999. Based on performance levels achieved during 1999, the
Committee approved aggregate bonus payments of $4,605,556. The annual incentive
of $661,600 paid to the Chief Executive Officer for 1999 was based on
pre-established performance goals.
LONG-TERM PERFORMANCE INCENTIVES. Long-term performance incentives for
senior management employees are provided through long-term performance share
programs ("Programs") established under the stockholder approved Executive
Incentive Plan and through the 1988, 1996 and 1999 Stock Plans. The current
programs operate on two and three-year award cycles. The Committee selects
participants, establishes target awards, and determines a performance matrix
(based on return on equity, return on invested capital, net earnings and other
selected factors) at the beginning of each award cycle. The performance matrix
provides for the performance shares to be increased or decreased in number based
on greater or lesser levels of performance. Earned performance shares are then
valued at the company's stock price at the end of the performance period. The
Committee approves the number of performance shares to be paid following a
review of results at the end of each performance cycle. Awards may be paid in
cash or in shares of common stock or any combination of cash and stock.
The Committee previously selected the six executive officers that
participated in the award cycle ending in 1999. Based on performance goals
previously established by the Committee, no payments were made for 1999. During
1999, the Committee selected the participants and established the performance
goals for the 1999-2000 and 1999-2001 award cycles. The performance goals for
the cycles ending in 2000 and 2001 are based on the company's return on net
assets.
12
<PAGE>
STOCK INCENTIVES. Long-term stock incentives are provided through
grants of stock options and restricted stock to executive officers and other key
employees pursuant to the stockholder approved 1988, 1996 and 1999 Stock Plans
(all referenced hereafter as the "Plan"). The stock component of compensation is
intended to retain and motivate employees to improve long-term shareholder
value. Stock options are granted at the prevailing market value and have value
only if the Company's stock price increases. Stock options vest beginning on the
first anniversary of the grant in equal amounts over three years or on the fifth
anniversary of the grant. Employees must be employed by the Company at the time
of vesting in order to exercise the options. The Committee believes this element
of the total compensation program directly links the participant's interests
with those of the shareholders and the long-term performance of the Company.
The Committee establishes the number and terms of options granted under
the Plan. The Committee encourages executives to build a substantial ownership
investment in the Company's common stock. The Options Exercised table on page 10
reflects the shares acquired by certain executive officers during 1999. The
table on page 4 reflects the ownership position of the directors and executive
officers at March 3, 2000. Outstanding performance by an individual executive
officer is recognized through larger option grants. The Committee, in
determining grants of stock options under the Plan, also reviews and considers
the executive's history of retaining shares previously obtained through the
exercise of prior options.
The Committee granted options for an aggregate of 762,250 shares to 152
employees during 1999, including options for an aggregate of 350,000 shares to
the executive officers. The Chief Executive Officer was granted non-qualified
options in February 1999 to acquire 100,000 shares and in December 1999 to
acquire 100,000 shares. The number of shares awarded in the 1999 grants
recognizes the performance of the business over the last five years under Mr.
Bay's leadership and his performance in managing the Company during the
difficult agricultural cycle.
Restricted stock grants are also a part of the Company's long-term
stock incentives. Restricted stock awards will be issued when performance
results and the strategic needs of the business so warrant. There were no
restricted stock awards in 1997, 1998 or 1999 to executive officers.
The Committee believes that the programs described above provide
compensation that is competitive with comparable manufacturing companies, links
executive and shareholder interests and provides the basis for the Company to
attract and retain qualified executives. The Committee will continue to monitor
the relationship among executive compensation, the Company's performance and
shareholder value.
COMPENSATION COMMITTEE
Charles M. Harper, Chairman
Thomas F. Madison
Charles D. Peebler, Jr.
13
<PAGE>
SHAREHOLDER RETURN PERFORMANCE GRAPHS
The graph below compares the yearly change in the cumulative total
shareholder return on the Company's common stock with the cumulative total
returns of the S&P Small Cap 600 Index and an index consisting of a combination
of the S&P Manufacturing (Diversified) and Machinery (Diversified) indexes for
the five year period ended December 31, 1999. The graph assumes that the value
of the investment in Valmont Common Stock and each index was $100 on December
31, 1994 and that all dividends were reinvested.
<TABLE>
<CAPTION>
INDEXED RETURNS
Base Years Ending
Period
Company / Index 1994 1995 1996 1997 1998 1999
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
VALMONT INDUSTRIES 100 147.53 248.54 237.59 171.74 202.09
S&P SMALLCAP 600 INDEX 100 129.96 157.67 198.01 195.42 219.66
MANUFACTURING/MACHINERY INDEX 100 132.09 174.18 213.84 227.94 271.69
</TABLE>
14
<PAGE>
INDEPENDENT AUDITORS
The firm of Deloitte & Touche LLP ("Deloitte") has been appointed by
the Board of Directors to conduct the 2000 audit of the Company's financial
statements. The same firm conducted the 1998 and 1999 audits. The Board of
Directors requests that shareholders ratify this appointment. A representative
from Deloitte will be present at the Shareholders' Meeting and will have the
opportunity to respond to appropriate questions.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the next annual
meeting of shareholders must be received by the Company no later than November
22, 2000 in order to be considered for inclusion in the proxy statement for such
meeting.
The Company's bylaws set forth certain procedures which shareholders
must follow in order to nominate a director or present any other business at an
annual shareholders' meeting. Generally, a shareholder must give timely notice
to the Secretary of the Company. To be timely, such notice must be received by
the Company at its principal executive offices not less than ninety nor more
than one hundred twenty days prior to the meeting. The bylaws specify the
information which must accompany such shareholder notice. Details of the
provision of the bylaws may be obtained by any shareholder from the Secretary of
the Company.
OTHER MATTERS
The Board of Directors does not know of any matter, other than those
described above, that may be presented for action at the Annual Meeting of
Shareholders. If any other matter or proposal should be presented and should
properly come before the meeting for action, the persons named in the
accompanying proxy will vote upon such matter and upon such proposal in
accordance with their best judgment.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Thomas P. Egan, Jr.
Thomas P. Egan, Jr.
Secretary
Valmont Industries, Inc.
15
<PAGE>
[Valmont Logo] ONE VALMONT PLAZA
OMAHA, NEBRASKA
68154-5215 USA
PHONE 402.963.1000
FAX 402.963.1199
www.valmont.com
<PAGE>
PROXY
VALMONT INDUSTRIES, INC.
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS ON APRIL 26, 2000
The undersigned hereby constitutes and appoints Mogens C. Bay and Robert B.
Daugherty, or any substitute appointed by them, the undersigned's agents,
attorneys and proxies to vote, as designated below, the number of shares the
undersigned would be entitled to vote if personally present at the Annual
Meeting of the Shareholders of Valmont Industries, Inc., to be held at the
Joslyn Art Museum, 2200 Dodge Street, Omaha, Nebraska 68102, on April 26, 2000
at 2:00 p.m. local time, or at any adjournments thereof.
1) ELECTION OF DIRECTORS
[ ] FOR all nominees listed below (except as designated to the
contrary below).
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below.
Robert B. Daugherty
Charles D. Peebler, Jr.
Kenneth E. Stinson
(Instruction: To withhold authority to vote for any individual nominee, write
the nominee's name on the space provided below.)
- --------------------------------------------------------------------------------
2) PROPOSAL to ratify the appointment of Deloitte & Touche LLP as
independent accountants for fiscal 2000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3) IN THEIR DISCRETION, the Proxies are authorized to vote upon such other
business or matters as may properly come before the meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. THIS PROXY WHEN
PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED
SHAREHOLDER. IF PROPERLY EXECUTED AND NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED IN FAVOR OF ALL PROPOSALS.
Dated this ___ day of _____________, 2000. Signature___________________________
Signature___________________________
(When signing as attorney, executor,
administrator, trustee, guardian or
conservator, designate full title.
All joint tenants must sign.)
