SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
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Check the appropriate box:
[ ] Preliminary Proxy Statement
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(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ' 240.14a-11(c) or ' 240.14a-12
METALS USA, INC.
---------------------------
(Name of Registrant as Specified In Its Charter)
------------------------------------------------
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previously. Identify the previous filing by registration statement number, or
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<PAGE>
[METALS USA LOGO]
April 17, 2000
To Our Stockholders:
On behalf of the Board of Directors, I cordially invite all stockholders
to attend the Annual Meeting of Metals USA, Inc. to be held on Wednesday, May
17, 2000, at 10:00 a.m. at The Omni, Four Riverway, Houston, Texas 77056. Proxy
materials, which include a Notice of the Meeting, Proxy Statement and proxy
card, are enclosed with this letter. The Company's 1999 Annual Report and Form
10-K which are not a part of the proxy materials, are also enclosed and provide
additional information regarding the financial results of the Company for the
year ended December 31, 1999.
We hope that you will be able to attend the Annual Meeting. Your vote is
important. Whether you plan to attend or not, please execute and return the
proxy card in the enclosed envelope, or vote electronically as described on the
proxy card, so that your shares will be represented. If you are able to attend
the meeting in person, you may revoke your proxy and vote your shares in person.
If your shares are not registered in your own name and you would like to attend
the meeting, please ask the broker, trust, bank or other nominee that holds the
shares to provide you with evidence of your share ownership.
We are pleased to offer stockholders the opportunity to receive future
annual reports and proxy materials electronically over the Internet. You can
consent to participate in this program in the future as described on the
enclosed proxy card.
We look forward to seeing you at the meeting.
Sincerely,
J. Michael Kirksey
President and Chief Executive Officer
<PAGE>
Metals USA, Inc.
Three Riverway, Suite 600
Houston, Texas 77056
-------------------------------------
NOTICE OF 2000 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 17, 2000
-------------------------------------
TO THE STOCKHOLDERS:
The 2000 Annual Meeting of Stockholders of Metals USA, Inc., (the
"Company"), will be held at The Omni, Four Riverway, Houston, Texas 77056 at
10:00 a.m. on Wednesday, May 17, 2000, for the following purposes:
1. To elect four Class III directors of the Company to hold office
until the third succeeding annual meeting of stockholders after
their election (the 2003 Annual Meeting) and until their respective
successors shall have been elected and qualified.
2. To ratify the selection of Arthur Andersen LLP as the Company's
independent certified public accountants to audit the Company's
consolidated financial statements for the year ending December 31,
2000.
3. To transact such other business as may properly be brought before
the meeting or any adjournment thereof.
The holders of record of the Company's common stock at the close of
business on April 11, 2000 are entitled to notice of and to vote at the meeting
with respect to all proposals. We urge you to sign and date the enclosed proxy
card and return it promptly by mail in the enclosed envelope, or vote
electronically as described on the proxy card, whether or not you plan to attend
the meeting in person. If you do attend the meeting in person, you may withdraw
your proxy and vote personally on all matters brought before the meeting.
By Order of the Board of Directors,
John A. Hageman
Secretary
Houston, Texas
April 17, 2000
<PAGE>
METALS USA, INC.
Three Riverway, Suite 600
Houston, Texas 77056
---------------------------
PROXY STATEMENT
---------------------------
MEETING OF STOCKHOLDERS
TO BE HELD MAY 17, 2000
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors of Metals USA, Inc., a Delaware corporation (the
"Company"), for use at the Company's Annual Meeting of Stockholders and any
postponement or adjournment thereof (the "Annual Meeting") to be held at The
Omni, Four Riverway, Houston, Texas 77056 at 10:00 a.m. on Wednesday, May 17,
2000 for the purposes set forth in the notice attached hereto. This Proxy
Statement and the accompanying proxy card are being mailed to stockholders on or
about April 17, 2000.
RECORD DATE AND VOTING SECURITIES
The Board of Directors has fixed the close of business on April 11, 2000
as the record date (the "Record Date") for the determination of stockholders
entitled to notice of and to vote at the Annual Meeting. At the close of
business on the Record Date, the Company had outstanding and entitled to vote
36,513,572 shares of its common stock, par value $.01 per share ("Common
Stock"), including 2,349,206 shares of Restricted Voting Common Stock. No other
class of voting securities of the Company is outstanding. Each share of Common
Stock other than the Restricted Voting Common Stock entitles the holder to one
vote on each matter presented at the Annual Meeting, other than the election of
directors. Each share of Restricted Voting Common Stock is entitled to 55% of
the voting power attributable to the Company's Common Stock on all matters
submitted to a vote of the holders of the Common Stock except for the election
of Directors. The holders of Restricted Voting Common Stock, voting as a class,
are entitled to elect one member of the Company's Board of Directors. The
holders of Restricted Voting Common Stock elected Mr. Steven S. Harter as a
Class I Director at the May 20, 1998 Stockholders' Meeting and therefore are not
entitled to vote in the election of Directors at the May 17, 2000 Stockholders'
Meeting. A proxy will be voted in the manner specified on the proxy, or if no
manner is specified, will be voted in favor of the proposals set forth in the
notice attached hereto.
The presence of the holders of a majority of the issued and outstanding
shares of Common Stock and Restricted Voting Common Stock of the Company
entitled to vote at the Annual Meeting, either in person or represented by
properly executed or electronic proxies, is necessary to constitute a quorum for
the transaction of business at the Annual Meeting. If there are not sufficient
shares represented in person or by proxy at the Annual Meeting to constitute a
quorum, the Annual Meeting may be postponed or adjourned in order to permit
further solicitation of proxies by the Company. Abstentions are counted as
"shares present" at the meeting for purposes of determining the presence of a
quorum while broker non-votes (which result when a broker holding shares for a
beneficial owner has not received timely voting instructions on certain matters
from such beneficial owner) are not considered "shares present" with respect to
any matter.
The election of directors will be determined by a plurality of the votes
cast at the meeting by holders of shares of Common Stock. Accordingly,
abstentions will have no effect on the outcome of the election of directors.
Cumulative voting for the election of directors is not permitted. The approval
of Proposal 2 (to ratify the selection of the Company's accountant) will be
determined by a majority of the votes cast by holders of Common Stock and
Restricted Voting Common Stock, and abstentions and non-votes will have no
effect.
1
<PAGE>
REVOCATION OF PROXY
Stockholders submitting proxies may revoke them at any time before they
are voted (i) by notifying John A. Hageman, Secretary of the Company, in writing
of such revocation, (ii) by execution of a subsequent proxy sent to Mr. Hageman,
or (iii) by attending the Annual Meeting in person and voting in person. Notices
to Mr. Hageman referenced in (i) and (ii) should be directed to John A. Hageman,
Secretary, Metals USA, Inc., Three Riverway, Suite 600, Houston, Texas 77056.
Stockholders who submit proxies and attend the meeting to vote in person are
requested to notify Mr. Hageman at the Annual Meeting of their intention to vote
in person at the Annual Meeting.
SOLICITATION EXPENSES
The expense of preparing, printing and mailing proxy solicitation
materials will be borne by the Company. In addition to solicitation of proxies
by mail, certain directors, officers, representatives and employees of the
Company may solicit proxies by telephone and personal interview. Such
individuals will not receive additional compensation from the Company for
solicitation of proxies, but may be reimbursed for reasonable out-of-pocket
expenses in connection with such solicitation. Banks, brokers and other
custodians, nominees and fiduciaries also will be reimbursed by the Company for
their reasonable expenses for sending proxy solicitation materials to the
beneficial owners of Common Stock.
The Company's Annual Report to Stockholders and Form 10-K are being mailed
to all stockholders entitled to vote at the Annual Meeting. The Annual Report
and Form 10-K do not constitute a part of the proxy solicitation material.
2
<PAGE>
ELECTION OF DIRECTORS (Proposal 1)
The Company's Amended and Restated Certificate of Incorporation provides
for three classes of Directors as nearly equal in number as possible. The term
of office of Class III directors expires at the 2000 Annual Meeting, the term of
office of Class I directors expires at the 2001 Annual Meeting (I.E., one year
of the term remaining), and the term of office of Class II directors expires at
the 2002 Annual Meeting (I.E., two years of the term remaining). The Class III
directors whose terms will expire at the 2000 Annual Meeting are A. Leon
Jeffreys, Tommy E. Knight, Lester G. Peterson and T. William Porter, all of whom
have been nominated and have agreed to stand for reelection at the 2000 Annual
Meeting.
SPECIAL NOTE: Holders of Restricted Voting Common Stock, voting as a class, are
entitled to elect one director to the Board. Such holders elected Mr. Steven S.
Harter as a Class I (term expires 2001) Director at the May 20, 1998
Stockholders' Meeting and, therefore, are not entitled to vote in the election
of directors at the May 17, 2000 meeting.
NOMINEES FOR ELECTION
CLASS III - TERMS EXPIRING AT 2003 ANNUAL MEETING
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR MESSRS. JEFFREYS, KNIGHT,
PETERSON AND PORTER AS DIRECTORS TO HOLD OFFICE UNTIL THE 2003 ANNUAL MEETING
AND UNTIL THEIR SUCCESSORS ARE ELECTED AND QUALIFIED. THE SHARES OF COMMON STOCK
REPRESENTED BY RETURNED PROXY CARDS WILL BE VOTED FOR THE ELECTION OF THESE
NOMINEES UNLESS OTHERWISE SPECIFIED.
Tommy E. Knight, 61, became a director on July 11, 1997. Mr. Knight, since
1964, was with Brown and Root, Inc., and served as its President and Chief
Executive Officer from 1992 until his retirement in 1996.
Lester G. Peterson, 59, became a director on July 11, 1997 and is Vice
President of the Company's Heavy Carbon Steel Group. Since 1981, he has served
as President of one of the Company's original founding subsidiaries, and is a
member of the Wisconsin Board of the Steel Service Center Institute.
T. William Porter, 59, became a director on July 11, 1997. He has been a
partner with Porter & Hedges, L.L.P., a Houston, Texas law firm, since 1981. Mr.
Porter is also a member of the Board of Directors of Gundle/SLT Environmental,
Inc. and ITEQ, Inc.
A. Leon Jeffreys, 70, became a director on October 21, 1997 and is Vice
President of the Company's Heavy Carbon Steel Group. He is the founder of one of
the Company's subsidiaries and has served as Chairman of its Board of Directors
since its inception in 1966.
The four nominees receiving the greatest number of votes cast will be
elected as Class III directors, regardless of the number of shares, if any,
withheld from voting for the election of such nominees.
INCUMBENT DIRECTORS
Class I - TERMS EXPIRING AT 2001 ANNUAL MEETING
Mark Alper, 54, became a director on July 11, 1997 and is a Vice President
of the Company. Mr. Alper has been an employee of one of the Company's original
founding subsidiaries since 1971 and served as its President from 1995 to 1999.
Craig R. Doveala, 48, became a director on July 11, 1997, is a Senior Vice
President of the Company and is responsible for the operations of the Company's
Specialty Metals Group. Mr. Doveala is also the CEO of one of the Company's
original founding subsidiaries and was its President from 1990 to 1998.
3
<PAGE>
Steven S. Harter, 38, has been a director of the Company since July 1996.
Mr. Harter is the President of Notre Capital Ventures II, LLC ("Notre"). Prior
to becoming the President of Notre, Mr. Harter was Senior Vice President of
Notre Capital Ventures, Ltd. From April 1989 to June 1993, Mr. Harter was
Director of Mergers and Acquisitions for Allwaste, Inc., an environmental
services company. From May 1984 to April 1989, Mr. Harter was a certified public
accountant with Arthur Andersen LLP. Mr. Harter also serves as a member of the
Board of Directors of Comfort Systems USA, Inc.
Patrick A. Notestine, 53, became a director on July 11, 1997 and is Vice
President of the Company's Flat- Rolled Steel Group. He has served as the
President of one of the Company's original founding subsidiaries since 1988.
Richard A. Singer, 54, became a director on July 11, 1997, is Senior Vice
President of the Company and is responsible for the operations of the Company's
Heavy Carbon Group. Since 1972, he has served as Chief Executive Officer of one
of the Company's original founding subsidiaries.
Thomas J. Shapiro, 48, became a director on May 20, 1998, is Senior Vice
President of the Company and is responsible for the operations of the Company's
Flat-Rolled Steel Group. He has been President and CEO of one of the Company's
subsidiaries since 1988 and its employee since 1973.
Class II - TERMS EXPIRING AT 2002 ANNUAL MEETING
Arnold W. Bradburd, 75, became a director on July 11, 1997, has served as
Chairman of the Board of Directors of the Company since October, 1999 and was
previously Vice-Chairman of the Board of Directors. He has been employed by one
of the Company's original founding subsidiaries since 1974, serving as Chairman
of its Board and as Chief Executive Officer from 1979 to 1998. Mr. Bradburd has
served as National Secretary of the Association of Steel Distributors and as
Chairman of the Steel Service Center Institute ("SSCI").
Richard H. Kristinik, 61, became a director on July 11, 1997. He was
Chairman of the Board and Chief Executive Officer of Coach USA, Inc., from March
1996 until his retirement in November 1998 and served as a board member until
April, 1999. From 1973 to 1996, Mr. Kristinik was a partner with Arthur Andersen
LLP. The majority of this time was in its Houston office. Additionally, he
served as Managing Partner of the Tulsa Office from 1979 to 1984 and Managing
Partner of the Denver office from 1985 to 1989.
J. Michael Kirksey, 44, became a director on April 30, 1997 and has served
as President and Chief Executive Officer since October, 1999. From December 1996
until October 1999, Mr. Kirksey served as Senior Vice President and Chief
Financial Officer of the Company. From 1995 to February 1997, Mr. Kirksey was
Director - Business Development and Acquisitions of Keystone International, Inc.
("Keystone"); from 1993 to 1995 was Vice President of Finance for Keystone's
European operations based in Brussels, Belgium; and from 1989 to 1993 was Vice
President and Controller of Keystone. From 1976 to 1989, Mr. Kirksey was a
certified public accountant with Arthur Andersen LLP.
Franklin Myers, 47, has been Senior Vice President and General Counsel of
Cooper Cameron Corporation ("Cooper Cameron") since April, 1995. Mr. Myers is
also the President of the Cooper Energy Services Division of Cooper Cameron.
Prior to joining Cooper Cameron, Mr. Myers was Senior Vice President and General
Counsel of Baker Hughes, Inc. from 1988 until 1995. He currently serves as a
member of the Board of Directors of Reunion Industries, Inc.
William L. Transier, 45, has been Executive Vice President and Chief
Financial Officer of Ocean Energy, Inc. ("Ocean") since March 1999 and served as
Chief Financial Officer of Seagull Energy Corporation from April 1996 until it
merged with Ocean in March 1999. From 1976 to 1996, Mr. Transier was an audit
partner at KPMG Peat Marwick LLP ("Peat Marwick") and served as National
Industry Director at Peat Marwick prior to joining Seagull.
4
<PAGE>
GENERAL INFORMATION WITH RESPECT
TO THE BOARD OF DIRECTORS
MEETINGS
During the year ended December 31, 1999, the Board of Directors held 8
meetings and acted one time by unanimous consent. During 1999, each member of
the Board of Directors attended at least 75% of all meetings of the Board of
Directors and committees of the Board of Directors of which such director was a
member. There are six standing committees of the Board of Directors.
COMMITTEES OF THE BOARD
AUDIT COMMITTEE. The Audit Committee consists of William L. Transier
(Chairman), Steven S. Harter, Tommy E. Knight and Richard H. Kristinik. The
Audit Committee: (i) makes recommendations to the Board of Directors with
respect to the independent auditors who conduct the annual examination of the
Company's accounts; (ii) reviews the scope of the annual audit and meets
periodically with the Company's independent auditors to review their findings
and recommendations; (iii) reviews quarterly financial information and earnings
releases prior to dissemination to the public; (iv) approves major accounting
policies or changes thereto; and (v) periodically reviews principal internal
controls to assure that the Company is maintaining a sound and effective system
of financial controls. During 1999, the Audit Committee held four meetings.
ACQUISITIONS COMMITTEE. The Acquisitions Committee consists of Steven S.
Harter (Chairman), Arnold W. Bradburd, J. Michael Kirksey, Lester G. Peterson,
Craig R. Doveala, Mark Alper, A. Leon Jeffreys, and Patrick A. Notestine. The
Acquisitions Committee reviews and monitors the strategic direction of the
Company's acquisition program and, within guidelines established by the Board of
Directors, has authority to approve offers and the form of consideration to be
offered for the acquisition of other businesses. During 1999, the Acquisitions
Committee held one meeting.
COMPENSATION AND MANAGEMENT DEVELOPMENT COMMITTEE. The Compensation and
Management Development Committee consists of Tommy E. Knight (Chairman), Steven
S. Harter, Franklin Myers and T. William Porter. The Compensation and Management
Development Committee periodically determines the amount and form of
compensation and benefits payable to all principal officers and certain other
management personnel. This committee also performs the duties of administration
with respect to the Company's incentive compensation plan. See "Report of
Compensation and Management Development Committee on Executive Compensation."
During 1999, the Compensation and Management Development Committee held seven
meetings and acted seven times by unanimous consent.
EXECUTIVE COMMITTEE. The Executive Committee consists of J. Michael
Kirksey (Chairman), Arnold W. Bradburd, Richard A. Singer, T. William Porter and
Thomas J. Shapiro. The Executive Committee has such authority as is delegated to
it from time to time by the full Board of Directors. During 1999, the Executive
Committee did not meet.
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE. The Nominating and
Corporate Governance Committee consists of Mark Alper (Chairman), Patrick A.
Notestine, T. William Porter, A. Leon Jeffreys and Lester G. Peterson. The
Nominating and Corporate Governance Committee reviews the size and composition
of the Board of Directors, designates new directors by class, interviews new
director candidates and makes recommendations with respect to nominations for
the election of directors. During 1999, the Nominating and Corporate Governance
Committee held three meetings.
TECHNOLOGY COMMITTEE. The Technology Committee consists of J. Michael
Kirksey (Chairman), Arnold W. Bradburd, Craig R. Doveala, Richard A. Singer and
Thomas J. Shapiro. The Technology Committee was established to oversee the
development and integration of informational systems used by the Company and its
subsidiaries. During 1999, the Technology Committee held one meeting.
5
<PAGE>
DIRECTORS' COMPENSATION
During 1999, each non-employee director was paid a fee of $2,000 for each
meeting of the full Board. Non-employee directors of the Company also receive
$1,000 for each committee meeting attended, unless held the same day as a
meeting of the full Board, and are reimbursed for all expenses relating to
attendance at meetings. The Company paid aggregate fees of $100,000 to
non-employee directors of the Company in connection with the Board of Directors'
and committee meetings in 1999. The Company does not pay director fees to
directors who also are employees of the Company. No member of the Board of
Directors was paid compensation during 1999 for his service as a director of the
Company other than pursuant to the standard compensation arrangement described
above. Non-employee directors also receive annual stock option awards pursuant
to the Company's 1997 Non-Employee Directors' Stock Plan (the "Directors'
Plan"), which was adopted by the Board of Directors and approved by the
Company's stockholders in April 1997.
The Directors' Plan provides for the automatic grant to each non-employee
director of an option to purchase 10,000 shares of Common Stock upon such
person's initial election as a director. Options to purchase 10,000 shares of
Common Stock were granted to Messrs. Harter, Knight, Kristinik and Porter in
1997 and to Messrs. Transier and Myers in 1999 pursuant to the Directors' Plan.
The Directors' Plan also provides for an automatic annual grant to each
non-employee director of an option to purchase 5,000 shares of Common Stock at
each annual meeting of stockholders unless the first annual meeting of
stockholders following a person's initial election as a non-employee director is
within three months of the date of such election. These options will have an
exercise price per share equal to the fair market value of a share at the date
of grant. Options granted under the Directors' Plan will expire at the earlier
of 10 years from the date of grant or one year after termination of service as a
director, and options will be immediately exercisable. In addition, the
Directors' Plan permits non-employee directors to elect to receive, in lieu of
cash directors' fees, shares or credits representing "deferred shares" that may
be settled at future dates, as elected by the director. The number of shares or
deferred shares received will be equal to the number of shares which, at the
date the fees would otherwise be payable, will have an aggregate fair market
value equal to the amount of such fees.
6
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth information as of March 31, 2000 with
respect to beneficial ownership of the Company's Common Stock by (i) each
director and nominee for director, (ii) each executive officer, (iii) all
executive officers and directors as a group, and (iv) each person known to the
Company to beneficially own 5% or more of the outstanding shares of its Common
Stock. The address of all such persons is c/o Metals USA, Inc., Three Riverway,
Suite 600, Houston, Texas 77056. Unless otherwise indicated, each of the
stockholders has sole voting and investment power with respect to the shares
beneficially owned.
<TABLE>
<CAPTION>
NUMBER OF SHARES
THAT MAY BE
ACQUIRED WITHIN
NUMBER OF SHARES 60 DAYS BY
BENEFICIALLY EXERCISE OF
BENEFICIAL OWNER OWNED OPTIONS PERCENTAGE
---------------- ---------- ---------- ----------
<S> <C> <C> <C>
Toby L. Jeffreys(1) ........................................................... 2,478,347 6.7%
David L. Babson & Co., Inc. ................................................... 2,108,500 5.7%
Arnold W. Bradburd ............................................................ 1,757,814 4.7%
Thomas J. Shapiro(2) .......................................................... 1,639,432 4,000 4.4%
A. Leon Jeffreys(1) ........................................................... 1,179,438 3.2%
Steven S. Harter(3) ........................................................... 1,021,048 20,000 2.7%
Lester G. Peterson ............................................................ 477,544 1.3%
Richard A. Singer ............................................................. 464,062 4,000 1.3%
Patrick A. Notestine .......................................................... 398,703 1.1%
Craig R. Doveala .............................................................. 334,497 2,000 *
Mark Alper .................................................................... 290,635 *
J. Michael Kirksey(4) ......................................................... 112,000 44,000 *
John A. Hageman(5) ............................................................ 74,480 33,000 *
Keith E. St. Clair(6) ......................................................... 60,000 23,000 *
Richard H. Kristinik .......................................................... 20,000 20,000 *
T. William Porter ............................................................. 15,000 20,000 *
Tommy E. Knight ............................................................... 10,000 20,000 *
Franklin Myers ................................................................ 10,000 10,000 *
William L. Transier ........................................................... -- 10,000 *
---------- ---------- ----------
All executive officers and directors as
a group (18 persons)(7) ..................................................... 11,366,805 210,000 31.1%
========== ========== ==========
</TABLE>
*Less than 1%.
(1) Includes 1,084,695 shares of Common Stock held by the Jeffreys Family
Partnership, of which Mr. Toby L. Jeffreys and Mr. A. Leon Jeffreys are
general partners.
(2) Includes 164,850 shares of Common Stock held by various trusts for which
Mr. Shapiro is a Trustee.
(3) Includes 1,011,048 shares of Restricted Voting Common Stock held by Harter
Venture Partners, Ltd., of which Mr. Harter is a general partner. Mr.
Harter disclaims beneficial ownership of 178,420 shares held in trust for
Mr. Harter's Minor Children of which neither he nor his wife is a trustee.
(4) Includes 10,000 shares of Common Stock held by Mr. Kirksey's minor
children and of which he is custodian.
(5) Includes 15,000 shares of Common Stock held by Mr. Hageman's minor
children and of which he is custodian.
(6) Includes 4,000 shares of Common Stock held by Mr. St. Clair's minor
children and of which he is custodian.
(7) This amount has been adjusted to eliminate any duplication of beneficial
ownership attributable to the 1,084,695 shares owned by the Jeffreys
Family Partnership and the shares of Common Stock issuable pursuant to the
exercise of Stock Options.
7
<PAGE>
EXECUTIVE OFFICERS
The Board elects executive officers annually at its first meeting
following the annual meeting of stockholders. Information concerning Messrs.
Singer, Doveala, Bradburd, Kirksey, and Shapiro is set forth above under
"Election of Directors." Information concerning Messrs. St. Clair and Hageman is
set forth below.
Keith E. St. Clair, 43, became Senior Vice President and Chief Financial
Officer of the Company in October 1999 and was previously Vice President and
Treasurer of the Company since April 1997. From 1987 to March, 1997, Mr. St.
Clair served as Corporate Controller of Gundle/SLT Environmental, Inc., a
publicly traded manufacturer and installer of synthetic lining systems. From
1980 to 1986, Mr. St. Clair was a certified public accountant with Arthur
Andersen LLP.
John A. Hageman, 45, became Senior Vice President, General Counsel and
Secretary of the Company in April 1997. From July, 1987 through March, 1997, Mr.
Hageman was Senior Vice President of Legal Affairs, General Counsel and
Secretary of Physician Corporation of America, a publicly-traded health
maintenance organization. From 1981 to 1987, Mr. Hageman was in private practice
in Wichita, Kansas.
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<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
The following table provides certain summary information concerning
compensation earned by the Company's Chief Executive Officer and each of the
five other most highly compensated executive officers (the "Named Executive
Officers") during the year ended December 31, 1999.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
--------------------------------------- ------------------------------
OTHER ANNUAL RESTRICTED NUMBER OF ALL OTHER
SALARY BONUS OMPENSATION STOCK AWARDS OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) (5) ($) ($) ($) GRANTED ($)(6)
---------------------------- ---- ----------- ----------- -------------- --------------- ------------ -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Arthur L. French................. 1999 250,000 20,000 ---- ---- ---- 11,559
Chief Executive Officer(1) 1998 150,000 100,000 ---- ---- ---- 8,409
1997 75,000 50,000 ---- ---- 200,000 1,465
J. Michael Kirksey............... 1999 250,000 25,000 ---- ---- 200,000 6,228
Chief Executive Officer(2) 1998 150,000 100,000 ---- ---- 20,000 3,542
1997 75,000 40,000 ---- ---- 100,000 266
Thomas J. Shapiro................ 1999 200,000 104,825 ---- ---- ---- 4,800
Senior Vice President 1998 150,000 75,000 ---- ---- 20,000 3,779
1997 25,000 ---- ---- ---- ---- 533
Keith E. St. Clair............... 1999 175,000 35,000 ---- ---- 50,000 4,524
Senior Vice President 1998 100,000 50,000 ---- ---- 15,000 2,350
And Chief Financial Officer(3) 1997 50,000 25,000 ---- ---- 50,000 158
John A. Hageman.................. 1999 175,000 30,000 ---- ---- 15,000 7,299
Senior Vice President 1998 150,000 75,000 ---- ---- 15,000 5,667
And General Counsel 1997 65,000 20,000 ---- ---- 75,000 666
Richard A. Singer................ 1999 200,000 26,250 ---- ---- ---- 5,051
Senior Vice President 1998 150,000 100,000 ---- ---- 20,000 5,764
1997 75,000 ---- ---- ---- ---- 470
Craig R. Doveala ................ 1999 165,000 94,500 ---- ---- ---- ----
Senior Vice President(4) 1998 150,000 75,000 ---- ---- 10,000 ----
1997 75,000 ---- ---- ---- ---- ----
</TABLE>
(1) Served as CEO from January 1 , 1999 through October 26, 1999.
(2) Became CEO effective October 26, 1999.
(3) Became Senior Vice President and CFO effective October 26, 1999.
(4) Became Senior Vice President effective February 22, 2000.
(5) With respect to 1997 compensation, reflects compensation from July 11,
1997 to December 31, 1997, except for Mr. Shapiro's compensation from
October 29, 1997.
(6) Includes the sums of the values of (a) Company contributions to 401(k)
plans of the Company and (b) premiums paid by the Company for term life
insurance for the benefit of the insured. The amounts described in clauses
(a) and (b) above for each of the Named Executive Officers on the 1999
line are set forth below:
(A) (B)
----- -----
Arthur L. French .............. 4,800 6,759
J. Michael Kirksey ............ 4,800 1,428
Thomas J. Shapiro ............. 4,800 --
Keith E. St. Clair ............ 3,575 949
John A. Hageman ............... 4,286 3,013
Richard A. Singer ............. 4,625 426
Craig R. Doveala .............. -- --
9
<PAGE>
STOCK OPTIONS
The following table reflects certain information regarding stock options
granted to the Named Executive Officers during 1999.
OPTION GRANTS IN 1999
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------------------------------------------------------
NUMBER OF
SECURITIES
UNDERLYING PERCENT OF TOTAL PRESENT VALUE
OPTIONS OPTIONS GRANTED TO EXERCISE EXPIRATION AT GRANT DATE
NAME GRANTED EMPLOYEES IN 1999 PRICE DATE (1)
- ---- ------------ ------------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Arthur L. French .................................. -- -- -- -- --
J. Michael Kirksey ............................... 200,000 27.3% $ 7.875 10/27/09 $ 950,000
Thomas J. Shapiro ................................. -- -- -- -- --
Keith E. St. Clair ................................ 50,000 6.8% 7.875 10/27/09 237,500
John A. Hageman ................................... 15,000 2.1% 7.875 10/27/09 71,250
Richard A. Singer ................................. -- -- -- -- --
Craig R. Doveala .................................. -- -- -- -- --
</TABLE>
(1) Computed using the Black-Scholes model, with the following assumptions:
expected price volatility -- 46.06% risk free rate of return -- 5.91%,
expected dividend yield -- 0%, and the expected life of the option was 7.5
years.
The following table reflects certain information concerning the number of
unexercised options held by the Named Executive Officers and the value of such
officers' unexercised options as of December 31, 1999. No options were exercised
by the Named Executive Officers during the year ended December 31, 1999.
YEAR END 1999 OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS "IN-THE-MONEY" OPTIONS
AT DECEMBER 31, 1999 AT DECEMBER 31, 1999 (1)
------------------------------- -------------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Arthur L. French ....................................... 200,000 -- 0 0
J. Michael Kirksey ..................................... 44,000 276,000 0 $ 125,000
Thomas J. Shapiro ...................................... 4,000 16,000 0 0
Keith E. St. Clair ..................................... 23,000 92,000 0 31,250
John A. Hageman ........................................ 33,000 72,000 0 9,375
Richard A. Singer ...................................... 4,000 16,000 0 0
Craig R. Doveala ....................................... 2,000 8,000 0 0
</TABLE>
(1) Options are "in-the-money" if the closing market price of the Company's
Common Stock exceeds the exercise price of the options. The exercise price
of the options granted in 1997 to Messrs. French, Kirksey (100,000), St.
Clair (50,000) and Hageman (75,000) is $10.00 per share. The exercise
price of the options granted in 1998 to Messrs. Kirksey (20,000), Shapiro,
St. Clair (15,000), Hageman (15,000), Singer and Doveala is $14.75 per
share. The exercise price of the options granted in 1999 to Messrs.
Kirksey (200,000), St. Clair (50,000) and Hageman (15,000) is $7.875 per
share. As of December 31, 1999, the market price of the stock was $8.50.
10
<PAGE>
STOCK PERFORMANCE GRAPH
The following performance graph compares the Company's cumulative total
stockholder return on its Common Stock with the cumulative total return of the
Standard & Poors 500 Index, and a peer group index comprised of Gibralter Steel
Corp. (ROCK), Reliance Steel & Aluminum Co. (RS), Ryerson Tull, Inc. (RT),
Shiloh Industries, Inc. (SHLO), Steel Technologies, Inc. (STTX) and Olympic
Steel, Inc. (ZEUS)("Peer Group") . The cumulative total return computations set
forth in the Performance Graph assumes the investment of $100 in the Company's
Common Stock, the Standard & Poors 500 Index, and the Peer Group on July 11,
1997.
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
JULY 11, 1997 SEPTEMBER 30, 1997 DECEMBER 31, 1997
- -------------------- -------------------- --------------------
MUI 100.00 MUI 145.294 MUI 143.529
S&P 500 100.00 S&P 500 103.338 S&P 500 105.864
PEER GROUP 100.00 PEER GROUP 96.490 PEER GROUP 88.424
MARCH 31, 1998 JUNE 30, 1998 SEPTEMBER 30, 1998
- --------------------- -------------------- --------------------
MUI 180.0 MUI 162.353 MUI 100.0
S&P 500 120.189 S&P 500 123.690 S&P 500 110.945
PEER GROUP 112.176 PEER GROUP 109.205 PEER GROUP 88.016
DECEMBER 31, 1998 MARCH 31, 1999 JUNE 30, 1999
- --------------------- -------------------- --------------------
MUI 91.765 MUI 82.353 MUI 120.0
S&P 500 134.096 S&P 500 140.329 S&P 500 149.748
PEER GROUP 75.873 PEER GROUP 73.221 PEER GROUP 97.805
SEPTEMBER 30, 1999 DECEMBER 31, 1999 MARCH 30, 2000
- --------------------- -------------------- --------------------
MUI 95.882 MUI 80.0 MUI 64.706
S&P 500 139.930 S&P 500 160.279 S&P 500 162.316
PEER GROUP 87.542 PEER GROUP 89.919 PEER GROUP 74.615
11
<PAGE>
REPORT OF COMPENSATION AND MANAGEMENT DEVELOPMENT COMMITTEE
ON EXECUTIVE COMPENSATION
The Compensation and Management Development Committee determines the
amount and form of compensation and benefits payable to all executive officers,
including the Named Executive Officers, and certain other management personnel.
The Compensation and Management Development Committee currently consists of four
(4) members, none of whom is a current or former employee or officer of the
Company except Mr. Harter, who served as President of the Company from July 3,
1996 to December 14, 1996, during which the Company had no operations and for
which he received no compensation.
The Compensation and Management Development Committee has instituted an
executive compensation structure designed to attract and retain highly qualified
executives and to motivate them to maximize stockholder returns. In order to
reach this goal, the Named Executive Officers' compensation program has three
components: base salary, bonus potential, and stock-based incentives.
BASE SALARY
At the time of the Company's IPO in 1997, the Company's executive
compensation philosophy relied principally on enterprise value as the primary
motivating factor for executive performance. Salaries were initially set at what
the Company believes were levels below that customarily paid by companies of
similar revenues and market capitalization. In 1999, executive base salaries
were increased toward more current market rates and in connection with increased
job responsibilities. Substantially all current executive officers have
employment agreements that establish a minimum base salary. See "Employment
Agreements."
SHORT-TERM INCENTIVE COMPENSATION
The Company's bonus program provides for cash awards based upon a
specified percentage of the individual's base salary. Executive bonuses are
dependent upon the extent to which corporate, or product group performance goals
were achieved. The objectives for both the Chief Executive and Chief Financial
Officers in 1999 were primarily related to the Company's overall profitability,
improvements in cash flow and other corporate goals. The objectives for product
group presidents were primarily related to corporate and product group operating
profits, improved inventory turns and safety performance. The actual awards paid
in respect of the year ended December 31, 1999 are shown in the accompanying
table under the column labeled "Bonus."
LONG-TERM INCENTIVE COMPENSATION
In April 1997, the Board of Directors and the Company's stockholders
approved the Company's 1997 Long-Term Incentive Plan (the "Incentive Plan").
Pursuant to the Incentive Plan, in October 1999 the Compensation Committee
approved grants of options covering 200,000 shares to Mr. Kirksey, 50,000 shares
to Mr. St. Clair and 15,000 shares to Mr. Hageman.
This report is furnished by the Compensation Management Development
Committee of the Board of Directors.
Tommy E. Knight, Chairman
Steven S. Harter
Franklin Myers
T. William Porter
12
<PAGE>
EMPLOYMENT AGREEMENTS
In July 1997, each of Messrs. Kirksey, Hageman and St. Clair entered into
an employment agreement with a subsidiary of the Company upon consummation of
the Company's IPO, providing for an initial annual base salary together with a
performance bonus as determined annually by the Board. Each employment agreement
is for a term of three years, and unless terminated or not renewed by the
Company or not renewed by the employee, the term will continue thereafter on a
year-to-year basis on the same terms and conditions existing at the time of
renewal. Each of these agreements provides that, in the event of a termination
of employment without cause during the first three years of the employment term,
the employee will be entitled to receive an amount equal to his then current
salary for the remaining term of the employment agreement or one year, whichever
is greater. In the event of a termination of employment without cause, the
employee will be entitled to receive an amount equal to his then current salary
for one year. In either case, payment is due in one lump sum on the effective
date of termination. In the event of a change in control of the Company (as
defined in the agreement) during the Initial Term, if the employee is not given
at least five days' notice of such change in control, the employee may elect to
terminate his employment and receive in one lump sum three times the amount he
would receive pursuant to a termination without cause during the Initial Term.
In addition, the non-competition provisions of the employment agreement would
not apply. In the event the employee is given at least five days' notice of such
change in control, the employee may elect to terminate his employment agreement
and receive in one lump sum two times the amount he would receive pursuant to a
termination without cause during the Initial Term. In such an event, the
non-competition provisions of the employment agreement would apply for two years
from the effective date of termination. Each employment agreement contains a
covenant not to compete with the Company for a period of two years immediately
following termination of employment, or in the case of termination by the
Company without cause in the absence of a change in control, for a period of one
year following termination of employment.
Each of Messrs. Bradburd, Alper, Doveala, Jeffreys, Notestine, Peterson,
Singer and Shapiro entered into an employment agreement with a subsidiary of the
Company following the acquisition of their companies, providing for an initial
annual base salary together with a performance bonus to be determined annually
by the Board. Each employment agreement is for a term of five years, and unless
terminated or not renewed by the respective company or not renewed by the
employee, the term will continue thereafter on a year-to-year basis on the same
terms and conditions existing at the time of renewal. Each of these agreements
provides that, in the event of a termination of employment by the respective
company without cause during the first three years of the employment term, the
employee will be entitled to receive from the respective company an amount equal
to his then current salary for the remaining term of the employment agreement or
one year, whichever is greater. In the event of a termination of employment
without cause during the final two years of the initial five-year term of the
employment agreement, the employee will be entitled to receive an amount equal
to his then current salary for one year. In either case, payment is due in one
lump sum on the effective date of termination. In the event of a change in
control of the Company (as defined in the agreement) during the Initial Term, if
the employee is not given at least five days' notice of such change in control,
the employee may elect to terminate his employment and receive in one lump sum
three times the amount he would receive pursuant to a termination without cause
during the Initial Term. In addition, the non-competition provisions of the
employment agreement would not apply. In the event the employee is given at
least five days' notice of such change in control, the employee may elect to
terminate his employment agreement and receive in one lump sum two times the
amount he would receive pursuant to a termination without cause during the
Initial Term. In such an event, the non-competition provisions of the employment
agreement would apply for two years from the effective date of termination. Each
employment agreement contains a covenant not to compete with the Company for a
period of two years immediately following termination of employment, or in the
case of termination by the Company without cause in the absence of a change in
control, for a period of one year following termination of employment.
13
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ORGANIZATION OF THE COMPANY
In connection with the formation of the Company, the Company issued to
Notre a total of 3,367,914 shares of Common Stock in exchange for services
provided by an employee of Notre at a cost of $35,375 to Notre. Mr. Harter is
the President of Notre and a director of the Company. In April 1997, Notre
exchanged 3,122,914 shares of Common Stock for 3,122,914 shares of Restricted
Voting Common Stock. Prior to the consummation of the IPO, Notre advanced to the
Company $1,310,000 to enable the Company to effect the Mergers and the IPO. All
of Notre's advances were repaid from the net proceeds of the IPO. Subsequent to
the IPO, Notre distributed its shares to its owners.
From December 1996 through April 1997, the Company issued a total of
255,000 shares of Common Stock (as adjusted for a 135.81-to-one stock split) at
$.01 per share to executive officers, as follows: Mr. Kirksey -- 120,000 shares,
Mr. St. Clair -- 60,000 shares, and Mr. Hageman -- 75,000 shares. The Company
also issued 1,130,500 shares of Common Stock at $0.01 per share to other
employees of and consultants to the Company, including a total of 405,000 shares
of Common Stock to persons who became directors of the Company upon consummation
of the IPO. The Company also granted options to purchase 10,000 shares of Common
Stock under the Directors' Plan, effective upon the consummation of the IPO to
Messrs. Knight, Kristinik, Porter and Harter.
The aggregate consideration paid by the Company for the eight companies
acquired in the IPO and the subsequent acquisitions (the "Acquired Companies")
consisted of $380.1 million in cash, 26,959,881 shares of Common Stock, $7.6
million in notes, plus the assumption of approximately $249.2 million of
indebtedness. The consideration paid by the Company for each of the Acquired
Companies was determined by negotiation between representatives of each Acquired
Company and was based primarily upon the pro forma adjusted net income of each
Acquired Company.
Pursuant to the agreements that were entered into in connection with the
acquisitions of the Acquired Companies, the principal stockholders of the
Acquired Companies have agreed not to compete with the Company for five years,
effective on the respective dates of acquisition.
14
<PAGE>
LEASES OF FACILITIES AND PERSONAL PROPERTY
The Levinson Steel Company, L.P. ("Levinson") leases the facilities
located in Philadelphia, Pennsylvania and Baltimore, Maryland from Warehouse
Real Estate Associates ("WREA")(reorganized as Warehouse Real Estate Associates,
L.P.), a partnership controlled by Mr. Bradburd, the Chairman of the Company,
and his wife. The leases were for an initial term of ten years (beginning July,
1999) and provide for a total annual rental of $234,000 during the initial five
years, to be adjusted to an applicable current market rate during the second
five years. At the conclusion of the initial lease term, Levinson has agreed to
purchase the real estate from WREA at a price to be determined by averaging two
or more independent appraisals. In 1998, Levinson leased the facilities located
in Ambridge, Pennsylvania from Warehouse Real Estate Associates, L.P. II, a
partnership controlled by Mr. Bradburd. The lease is for a term of ten years and
provides for annual rental of $450,000. At the conclusion of the lease term,
Levinson/Metals is required to purchase the property at fair market value
determined by two or more independent appraisals. However, Levinson/Metals may
acquire the property after year eight at 90% of fair market value determined by
two or more independent appraisals. Additionally, Levinson pays all utility,
taxes and insurance costs on each of the leased premises. The Company believes
that the rent to be paid under the leases does not exceed fair market value.
Jeffreys Steel Company ("Jeffreys") leases two adjacent tracts of real
property located in Wilmington, North Carolina from The Alper Company, a
partnership of which Mr. Alper, a director and Vice President of the Company, is
a controlling person. The lease on one tract of real property is for a term of
20 years, expires in 2017 and provides for an annual rental of $40,000. The rent
will be adjusted every five years in accordance with the Consumer Price Index
("CPI"). At the conclusion of the tenth year of the lease, Jeffreys has the
option to purchase the real property from The Alper Company for an amount equal
to the average of three independent appraisals. If Jeffreys does not exercise
its option, the annual rental will be adjusted to reflect a ten year
amortization of the fair market value of the property. The lease on the other
tract of real property is for a term of 20 years, expires in 2017 and provides
for an annual rental of $137,200. The rent will be adjusted every five years in
accordance with the CPI. Jeffreys will pay for all utilities, taxes and
insurance on the leased properties. The Company believes that the rent for the
properties does not exceed fair market value.
Jeffreys has a lease agreement for the use of executive aircraft with
J-Air, Inc., an entity controlled by Mr. Toby Jeffreys, President and Chief
Executive Officer of Jeffreys. The term of the lease runs from January 1, 1999
to December 31, 2000 with a flat rate of $2,000 per hour and ten roundtrip
flights between Mobile, Alabama and Houston, Texas at a flat rate of $1,500 per
hour each calendar year. Jeffreys is not obligated, however, to use the aircraft
at any time during the lease term.
Steel Service Systems leased certain real property located in Horicon,
Wisconsin from July, 1997 to March, 2000 from an entity owned in part by Mr.
Doveala, a director and Senior Vice President of the Company. Mr. Doveala's
investment group sold the property to an unrelated third party in March, 2000.
The original lease for real property expired in 2007 and provided for an annual
rental of $420,000.
Uni-Steel, Inc. leases certain real property located in Enid, Oklahoma
from Garfield Development, LLC, an entity owned in part by Mr. Singer, a Senior
Vice President and director of the Company. The lease for the real property has
a ten-year term and provides for an annual rental of $115,000. The rent rate
will be adjusted every five years in accordance with the CPI. The Company
believes that the rent for the property does not exceed fair market value.
Williams Steel & Supply Co., Inc. ("Williams") leases certain real
property located in Milwaukee, Wisconsin from PP&W, L.L.C., an entity owned in
part by Mr. Peterson, a director of the Company. The lease for the rental
property expires on December 31, 2011, and provides for an annual rental of
$458,950. The rent will be adjusted every five years in accordance with the CPI.
Additionally, Williams pays for all utilities, taxes and insurance on the leased
premises. The Company believes that the rent for the property does not exceed
fair market value.
15
<PAGE>
OTHER TRANSACTIONS
On or about July 11, 1997, one of the Company's original founding
subsidiaries purchased certain equipment from WREA for $530,000. WREA is
controlled by Mr. Bradburd, the Chairman of the Company. The Company believes
that the purchase price for the equipment does not exceed the fair market value
thereof.
Jeffreys provides administrative services to Southern Metals Recycling,
Inc. ("Southern"), an entity owned in part by Mr. Alper, a director and Vice
President of the Company. In its last fiscal year, Jeffreys provided services,
billed Southern $204,456 for these services and sold scrap metal to Southern in
the amount of $12,510. The Company believes that the fees charged for such
services represent the fair market value of such services.
COMPANY POLICY
All transactions with directors, officers, employees or affiliates of the
Company or its subsidiaries must be approved in advance by a majority of
disinterested members of the Board of Directors.
COMPENSATION AND MANAGEMENT DEVELOPMENT COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
In 1999, the members of the Compensation and Management Development
Committee were Messrs. Porter, Harter, Knight and Myers.
Mr. Harter served as president of the Company during 1996, and he is the
President of Notre and a director of the Company. In connection with the
formation of the Company, the Company issued to Notre a total of 3,367,914
shares of Common Stock for aggregate consideration of $35,375. In April 1997,
Notre exchanged 3,122,914 shares of Common Stock for 3,122,914 shares of
Restricted Voting Common Stock. Prior to the consummation of the IPO, Notre
advanced to the Company $1,310,000 to enable the Company to effect the Mergers
and the IPO. All of Notre's advances were repaid from the net proceeds of the
IPO. Subsequent to the IPO, Notre distributed its shares to its owners.
RATIFICATION OF APPOINTMENT OF AUDITORS (Proposal 2)
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO RATIFY THE
SELECTION OF ARTHUR ANDERSEN LLP AS THE COMPANY'S INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS TO AUDIT THE COMPANY'S CONSOLIDATED FINANCIAL STATEMENTS FOR THE
YEAR ENDING DECEMBER 31, 2000. THE SHARES OF COMMON STOCK REPRESENTED BY
RETURNED PROXY CARDS WILL BE VOTED FOR THE PROPOSAL TO RATIFY THE APPOINTMENT OF
THE AUDITORS UNLESS OTHERWISE SPECIFIED.
At the Annual Meeting a vote will be taken on the proposal to ratify the
appointment by the Board of Directors of Arthur Andersen LLP, independent
certified public accountants, as auditors of the Company's consolidated
financial statements for the year ending December 31, 2000. Arthur Andersen
audited the consolidated financial statements of the Company for the years ended
December 31, 1999, 1998 and 1997.
Representatives of Arthur Andersen LLP are expected to be present at the
Annual Meeting, with the opportunity to make a statement should they choose to
do so, and to be available to respond to appropriate questions.
16
<PAGE>
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, executive officers and persons holding more than ten
percent of a registered class of the Company's equity securities to file with
the Securities and Exchange Commission ("SEC") and any stock exchange or
automated quotation system on which the Common Stock may then be listed or
quoted (i) initial reports of ownership, (ii) reports of changes in ownership
and (iii) annual reports of ownership of Common Stock and other equity
securities of the Company. Such directors, officers and ten-percent stockholders
are also required to furnish the Company with copies of all such filed reports.
Based solely upon review of the copies of such reports furnished to the
Company and written representations that no other reports were required during
1999, the Company believes that all Section 16(a) reporting requirements related
to the Company's directors and executive officers were timely fulfilled during
1999, with the exception of Mr. St. Clair, who completed the appropriate SEC
form for an initial filing but, due to an administrative error at the Company,
such SEC form was not filed timely with the SEC.
ANNUAL REPORTS
The Company's Annual Report to stockholders accompanies this Proxy
Statement. The Company filed its Annual Report on Form 10-K for the year ended
December 31, 1999 with the Securities and Exchange Commission on or about March
30, 2000. A copy of the Form 10-K, including any financial statements and
schedules and a list describing any exhibits not contained therein, accompanies
this Proxy Statement and a copy may also be obtained without charge to any
stockholder. Written requests for copies of the report should be directed to
John A. Hageman, Secretary, Metals USA, Inc., Three Riverway, Suite 600,
Houston, Texas 77056.
DEADLINE FOR SUBMISSION OF STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the Company's 2001
Annual Meeting of Stockholders must be received by the Secretary of the Company
no later than January 20, 2001, and must otherwise comply with the requirements
of Rule 14a-8 under the Securities Exchange Act of 1934.
The Company's Bylaws establish procedures, including advance notice
procedures, with regard to the nomination other than by or at the direction of
the Board of Directors, of candidates for election as directors and with regard
to certain matters to be brought before meetings of stockholders of the Company.
The Bylaws also contain procedures for regulation of the order of business and
conduct of stockholder meetings, the authority of the presiding officer and
attendance at such meetings.
OTHER MATTERS
The Board of Directors knows of no matters that are expected to be
presented at the Annual Meeting other than those described in this proxy
statement. Should any other matter properly come before the Annual Meeting,
however, the persons named in the form of proxy accompanying this proxy
statement will vote all shares represented by proxies in accordance with their
best judgment on such matters.
17
<PAGE>
- --------------------------------------------------------------------------------
P R O X Y P R O X Y
METALS USA, INC.
ANNUAL MEETING OF STOCKHOLDERS
Solicited by the Board of Directors of Metals USA, Inc.
The undersigned hereby appoints J. Michael Kirksey and Keith E. St. Clair,
and each of them individu- ally, as proxies with full power of substitution, to
vote all shares of Common Stock of Metals USA, Inc. that the undersigned is
entitled to vote at the Annual Meeting of Stockholders thereof to be held on May
17, 2000, or at any adjournment or postponement thereof, as follows:
Any executed proxy which does not designate a vote shall be deemed to
grant authority for any item not designated.
SEE REVERSE SIDE
^ Fold and Detach Here ^
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
/X/ Please mark your 2223
votes as in this
example.
- --------------------------------------------------------------------------------
ALL SHARES WILL BE VOTED AS DIRECTED HEREIN AND, UNLESS OTHERWISE DIRECTED, WILL
BE VOTED "FOR" PROPOSAL 1 (ALL NOMINEES), "FOR" PROPOSAL 2, AND IN ACCORDANCE
WITH THE DISCRETION OF THE PERSON VOTING THE PROXY WITH RESPECT TO ANY OTHER
BUSINESS PROPERLY BROUGHT BEFORE THE MEETING.
- --------------------------------------------------------------------------------
/_/ FOR WITHHELD /_/ FOR /_/ AGAINST /_/ ABSTAIN
1. Election of Directors.
NOMINEES:
1. A. Leon Jeffreys, 2. Tommy E. Knight, 3. Lester G. Peterson and 4. T. William
Porter to hold office until the 2003 Annual Meeting and until their successors
are elected and qualified
2. Ratification of appointment of Arthur Andersen LLP as auditors for the
company
/_/ FOR /_/ AGAINST /_/ ABSTAIN
INSTRUCTION: to withhold authority to vote for any individual nominee, write the
nominee's name in the space provided here.
Please check the following box if you plan to attend the Annual Meeting of
Stockholders in person. /_/
- --------------------------------------------------------------------------------
YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO A VOTE THEREON.
Please sign exactly as name appears on this card. Joint owners should each sign.
Executors, administrators, trustees, etc., should give their full titles. Please
complete, sign and promptly mail this proxy in the enclosed envelope.
______________________________________ __________________
SIGNATURE (S) DATE
^ Fold and Detach Here ^
- --------------------------------------------------------------------------------
NOW YOU CAN VOTE YOUR SHARES BY TELEPHONE OR INTERNET!
QUICK * EASY * IMMEDIATE * AVAILABLE 24 HOURS A DAY * 7 DAY A WEEK
Your telephone or Internet vote authorizes the named proxies to vote your shares
in the same manner as if you marked, signed, and returned your proxy card. To
vote by phone or Internet, please follow these easy steps:
TO VOTE BY PHONE
Thank you for voting!
Call toll free 1-877-PRX-VOTE (1-877-779-8683) on a touch tone telephone.
Shareholders residing outside the United States, Canada and Puerto Rico should
call 1-201-536-8073. Telephone voting will be available until 8:00 a.m., Eastern
time, the morning of the Annual Meeting.
Use the Control Number located in the box above, just below the perforation.
Enter the Control Number and pound signs (#) exactly as they appear. Follow the
recorded instructions.
TO VOTE BY INTERNET
Log onto http://www.eproxyvote.com/mui which will be available until midnight,
Eastern time, on May 17, 2000. Follow the instructions on the screen.
You can also elect to receive future shareholder materials electronically at
this web site. Simply log onto: http://www.eproxyvote.com/mui and follow the
instructions on the screen to receive these materials electronically.
<PAGE>
- --------------------------------------------------------------------------------
P R O X Y P R O X Y
METALS USA, INC.
ANNUAL MEETING OF STOCKHOLDERS
(RESTRICTED VOTING COMMON STOCK)
Solicited by the Board of Directors of Metals USA, Inc.
The undersigned hereby appoints J. Michael Kirksey and Keith E. St. Clair,
and each of them individu-ally, as proxies with full power of substitution, to
vote all shares of Restricted Voting Common Stock of Metals USA, Inc. that the
undersigned is entitled to vote at the Annual Meeting of Stockholders thereof to
be held on May 17, 2000, or at any adjournment or postponement thereof, as
follows:
Any executed proxy which does not designate a vote shall be deemed to
grant authority for any item not designated.
SEE REVERSE SIDE
^ Fold and Detach Here ^
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
/X/ Please mark your 2250
votes as in this
example.
- --------------------------------------------------------------------------------
ALL SHARES WILL BE VOTED AS DIRECTED HEREIN AND, UNLESS OTHERWISE DIRECTED, WILL
BE VOTED "FOR" PROPOSAL 2, AND IN ACCORDANCE WITH THE DISCRETION OF THE PERSON
VOTING THE PROXY WITH RESPECT TO ANY OTHER BUSINESS PROPERLY BROUGHT BEFORE THE
MEETING.
2. Ratification of appointment of Arthur Andersen LLP as auditors for the
company
/_/ FOR /_/ AGAINST /_/ ABSTAIN
SPECIAL NOTE:
Holders of Restricted Voting Common Stock, voting as a class, are entitled to
elect one director to the Board. Such holders elected Mr. Steven S. Harter as a
Class I (Term expires 2001) Director at the May 20, 1998 meeting and, therefore,
are not entitled to vote in the election of directors at the May 17, 2000
meeting.
Please check the following box if you plan to attend the Annual Meeting of
Stockholders in person. /_/
YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO A VOTE THEREON.
Please sign exactly as name appears on this card. Joint owners should
each sign. Executors, administrators, trustees, etc., should give their full
titles. Please complete, sign and promptly mail this proxy in the enclosed
envelope.
______________________________________ __________________
SIGNATURE (S) DATE
^ Fold and Detach Here ^
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NOW YOU CAN VOTE YOUR SHARES BY TELEPHONE OR INTERNET!
QUICK * EASY * IMMEDIATE * AVAILABLE 24 HOURS A DAY * 7 DAY A WEEK
Your telephone or Internet vote authorizes the named proxies to vote your shares
in the same manner as if you marked, signed, and returned your proxy card. To
vote by phone or Internet, please follow these easy steps:
TO VOTE BY PHONE
Thank you for voting!
Call toll free 1-877-PRX-VOTE (1-877-779-8683) on a touch tone telephone.
Shareholders residing outside the United States, Canada and Puerto Rico should
call 1-201-536-8073. Telephone voting will be available until 8:00 a.m., Eastern
time, the morning of the Annual Meeting.
Use the Control Number located in the box above, just below the perforation.
Enter the Control Number and pound signs (#) exactly as they appear. Follow the
recorded instructions.
TO VOTE BY INTERNET
Log onto http://www.eproxyvote.com/mui which will be available until midnight,
Eastern time, on May 17, 2000. Follow the instructions on the screen. You can
also elect to receive future shareholder materials electronically at this web
site. Simply log onto: http://www.eproxyvote.com/mui and follow the instructions
on the screen to receive these materials electronically.
