SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
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 Rule 14a-12
PETER KIEWIT SONS', INC.
(Name of Registrant as Specified in its Charter)
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*:
- -----------------------------------------------------------------
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: ----------------------------------------------
*Set forth the amount on which the filing fee is calculated and
state how it was determined.
April 21, 2000
Dear PKS Stockholder:
You are cordially invited to attend the Annual Meeting of
Stockholders of Peter Kiewit Sons', Inc. (the "Corporation") to
be held at 10:00 a.m. on Saturday, June 17, 2000, at Kiewit
Plaza, Omaha, Nebraska 68131.
Information concerning the matters to be considered and
voted upon at the Annual Meeting is set forth in the attached
Notice of Annual Meeting and Proxy Statement. The Corporation's
1999 Annual Report on Form 10-K is also enclosed for your review
and information.
It is important that your shares be represented at the
Annual Meeting, regardless of the number of shares that you hold.
Therefore, whether or not you plan to attend the Annual Meeting,
as soon as possible, please sign, date and return your Proxy in
the envelope that has been provided. The execution and delivery
of a Proxy will not prevent you from voting your shares in person
if you subsequently choose to attend the Annual Meeting.
Sincerely,
/s/ Kenneth E. Stinson
Kenneth E. Stinson
Chairman of the Board
PETER KIEWIT SONS', INC.
Kiewit Plaza
Omaha, Nebraska 68131
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held Saturday, June 17, 2000
To the Stockholders of Peter Kiewit Sons', Inc.:
The Annual Meeting of Stockholders ("Annual Meeting") of
Peter Kiewit Sons', Inc., a Delaware corporation (the
"Corporation"), will be held at Kiewit Plaza, Omaha, Nebraska
68131 at 10:00 a.m. on Saturday, June 17, 2000 for the following
purposes:
1. To elect twelve (12) directors to hold office as
specified in the attached Proxy Statement; and
2. To transact such other business as may properly come
before the Annual Meeting or any adjournments or postponements
thereof.
The Board of Directors has fixed the close of business on
April 20, 2000 (the "Record Date") as the record date for the
determination of the holders of Common Stock entitled to notice
of, and to vote at, the Annual Meeting. Accordingly, only holders
of record of Common Stock at the close of business on the Record
Date will be entitled to notice of and to vote at the Annual
Meeting and any adjournment or postponement thereof. No business
other than the election of directors is expected to be considered
at the Annual Meeting or at any adjournment or postponement
thereof. This Notice, the Proxy Statement and the accompanying
form of Proxy are first being mailed to Stockholders on or about
April 21, 2000.
The matters to be considered at the Annual Meeting are more
fully described in the accompanying Proxy Statement.
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL
MEETING. TO ENSURE YOUR REPRESENTATION AT THE ANNUAL MEETING,
HOWEVER, YOU ARE URGED TO COMPLETE, DATE, SIGN AND RETURN THE
ENCLOSED PROXY AS PROMPTLY AS POSSIBLE. A POSTAGE PREPAID
ENVELOPE IS ENCLOSED FOR THAT PURPOSE. ANY STOCKHOLDER ATTENDING
THE ANNUAL MEETING MAY VOTE IN PERSON EVEN IF THAT STOCKHOLDER
HAS RETURNED A PROXY.
By Order of the Board of Directors
/s/ Kenneth E. Stinson
Kenneth E. Stinson
Chairman of the Board
April 21, 2000
PETER KIEWIT SONS', INC.
Kiewit Plaza
Omaha, Nebraska 68131
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
To Be Held Saturday, June 17, 2000
THE MEETING; VOTING AND SOLICITATION
Date, Time and Place of the Annual Meeting
The annual meeting ("Annual Meeting") of the holders (the
"Stockholders") of the $0.01 par value common stock ("Common
Stock") of Peter Kiewit Sons', Inc., a Delaware corporation (the
"Corporation"), will be held on Saturday, June 17, 2000, at
10:00 a.m. local time, at Kiewit Plaza, Omaha, Nebraska 68131.
Purpose of the Annual Meeting
This Proxy Statement ("Proxy Statement") is being
furnished to Stockholders in connection with the solicitation of
proxies on behalf of the Board of Directors of the Corporation
(the "Board") to be voted at the Annual Meeting, or any
adjournment or postponement thereof, for the purpose of
considering the following matters: (a) to elect twelve (12)
directors to hold office as specified herein; and (b) to transact
such other business as may properly come before the Annual
Meeting.
Date of Provision of Proxy Statement
This Proxy Statement, the Notice of Annual Meeting and the
accompanying Proxy are first being mailed to Stockholders on or
about April 21, 2000.
Annual Meeting Record Date
As of April 20, 2000, the record date for the determination
of persons entitled to vote at the Annual Meeting (the "Record
Date"), there were 31,895,472 shares of Common Stock
outstanding. Each share of Common Stock is entitled to one vote
on each matter to be voted upon by the Stockholders at the Annual
Meeting.
Appraisal Rights
Stockholders will not be entitled to appraisal rights as a
result of the matters proposed to be considered at the Annual
Meeting.
Voting
The Corporation's Restated Certificate of Incorporation (the
"Certificate") provides the Stockholders with the option of
cumulative voting in any election of directors. A proxy form
which provides for cumulative voting will be provided promptly to
any Stockholder upon request, by writing the Stock Registrar at
Kiewit Plaza, Omaha, Nebraska 68131, or by calling him at (402)
342-2052. Under the cumulative voting method, the number of a
Stockholder's shares of Common Stock is first multiplied by the
number of directors to be elected. The resulting number of votes
may then be voted for a single nominee or distributed among some
or all of the nominees. After the voting is closed, the nominees
are ranked in order by the number of votes received. The highest
ranking nominees are then elected until the number of open
directorships is filled.
The approval of a plurality of the shares of Common Stock
present in person or by proxy at the Annual Meeting and entitled
to vote is required to elect the nominees as directors, unless
cumulative voting is required.
Stockholders can vote on matters presented at the Annual
Meeting by either voting in person or by signing, dating and
returning the enclosed proxy. In the election of directors, the
enclosed proxy may be marked for the election of all, some or
none of the nominees for director.
As of the Record Date, there were 31,895,472 shares of
Common Stock outstanding and entitled to vote at the Annual
Meeting. The presence, in person or by proxy, of the holders of a
majority of the issued and outstanding shares of Common Stock
entitled to vote as of the Record Date is required to constitute
a quorum at the Annual Meeting. Under applicable Delaware law,
abstentions and "non-votes" (that is, proxies from brokers or
nominees indicating that such persons have not received
instructions from the beneficial owner or other persons entitled
to vote shares as to a matter with respect to which the brokers
or nominees do not have discretionary power to vote) will be
treated as present for purposes of determining the presence of a
quorum at the Annual Meeting. If a quorum should not be present,
the Annual Meeting may be adjourned from time to time until the
necessary quorum is obtained.
Proxies
All shares of Common Stock represented by properly executed
proxies, which are returned and not revoked, will be voted in
accordance with the instructions, if any, given therein. If no
instructions are provided in a proxy, it will be voted FOR the
Board's nominees for director, and in accordance with the proxy-
holders' best judgment as to any other business raised at the
Annual Meeting.
Any Stockholder who delivers a proxy may revoke it at any
time before it is voted by delivering to the Secretary of the
Corporation a written statement revoking the proxy, by executing
and delivering a later dated proxy or by voting in person at the
Annual Meeting.
Solicitation Costs
The Corporation will bear its own cost of solicitation of
proxies. In addition to the use of the mails, proxies may be
solicited by certain directors, officers and other employees of
the Corporation, not specially employed for the purpose, by
personal interview, telephone, telegram or e-mail. Such
directors, officers and employees will not receive additional
compensation for such solicitation but may be reimbursed for out-
of-pocket expenses incurred in connection therewith.
EXPLANATORY NOTE
On March 31, 1998, the Corporation's former parent, Level 3
Communications, Inc. ("Level 3") transferred all of the issued
and outstanding shares of common stock of Kiewit Construction
Group Inc. ("KCG"), as well as certain other assets and
liabilities related to Level 3's construction and mining
business, which together with such common stock comprised all of
the construction and mining business of Level 3 (the
"Construction Business"), to the Corporation in exchange for
all of the Corporation's then outstanding shares of Common Stock.
Level 3 then distributed all of such Common Stock to the holders
of Level 3's Class C Construction & Mining Group Restricted
Redeemable Convertible Exchangeable Common Stock ("Class C
Stock"), in exchange for such shares of Class C Stock. As a
result of such transactions (collectively, the "Transaction"),
the Corporation is now owned by the former holders of Level 3's
Class C Stock, and now conducts the Construction Business. In
connection with the Transaction, the Corporation's name was
changed from "PKS Holdings, Inc." to "Peter Kiewit Sons',
Inc." and Level 3's name was changed from "Peter Kiewit Sons',
Inc." to "Level 3 Communications, Inc."
DIRECTOR NOMINEES
The Board has determined that twelve (12) directors are to
be elected to the Board at the Annual Meeting. All the nominees
are current directors of the Corporation. Each nominee has agreed
to serve as a director, if elected. Directors will be elected to
serve until the next annual election and until their successors
are duly elected and qualified. If any nominee shall, prior to
the Annual Meeting, become unavailable for election as a
director, the persons named in the proxy will vote for that
nominee, if any, in their discretion as may be recommended by the
Board, or the Board may reduce the number of directors to
eliminate the vacancy.
Name Business Experience Age
- ---- ------------------- ---
Mogens C. Bay Mr. Bay has been a director of the 51
Corporation since March 1999. Mr. Bay has
been Chairman of Valmont Industries, Inc.
("Valmont") since January 1997 and
President and Chief Executive Officer
of Valmont since August 1993. Mr. Bay is
also currently a director of Valmont,
ConAgra, Inc. and InaCom Corp. Mr. Bay
is a member of the Compensation Committee
and the Executive Compensation Subcommittee
of the Compensation Committee of the
Corporation.
Roy L. Cline Mr. Cline has been a director and 62
Executive Vice President of the
Corporation since June 1999. Mr. Cline
was the President of Kiewit Industrial
Co., a subsidiary of the Corporation,
from March 1992 until June 1999. Mr. Cline
is a member of the Executive Committee of
the Corporation.
Richard W. Colf Mr. Colf has been a director of the 56
Corporation since August 1997. Mr. Colf
has been an Executive Vice President of
the Corporation since July 1998. Mr. Colf
has been an Executive Vice President of
Kiewit Pacific Co. ("KPC"), a subsidiary
of the Corporation, since September 1998,
was a Senior Vice President of KPC from
October 1995 to September 1998 and was a
Vice President of KPC for more than five
years prior to October 1995. Mr. Colf is
a member of the Executive Committee of the
Corporation.
James Q. Crowe Mr. Crowe has been a director of the 50
Corporation since August 1997. Mr. Crowe
has been the President and Chief Executive
Officer of Level 3 since August 1997. Mr.
Crowe was Chairman of the Board of MFS
Communications Company, Inc. for more than
five years prior to December 1997, Chief
Executive Officer from November 1991 until
December 1997 and was President from January
1988 to June 1989 and from April 1990 until
January 1992. Mr. Crowe was Chairman of the
Board of MCI WorldCom, Inc. from January
1997 until July 1997. Mr. Crowe is currently
also a director of Commonwealth Telephone
Enterprises, Inc., RCN Corporation, InaCom
Corp. and Level 3. Mr. Crowe is a member of
the Compensation Committee of the
Corporation.
Richard Geary Mr. Geary has been a director of the 65
Corporation since August 1997. Mr. Geary
was an Executive Vice President of the
Corporation from August 1997 to July 1998.
Mr. Geary was an Executive Vice President of
KCG and President of KPC for more than five
years prior to August 1997. Mr. Geary is
currently also a director of Standard
Insurance Company, David Evans & Associates,
Today's Bank and is a trustee of the Oregon
Health Sciences University Foundation.
Bruce E. Grewcock Mr. Grewcock has been a director and 46
Executive Vice President of the
Corporation since August 1997. Mr.
Grewcock has been the President of Kiewit
Western Co., a subsidiary of the
Corporation, since July 1997. Mr. Grewcock
was an Executive Vice President of KCG from
July 1996 to June 1998, and President of
Kiewit Mining Group Inc., a subsidiary of
the Corporation, from January 1992 to July
1996. Mr. Grewcock is currently also a
director of Kinross Gold Corporation. Mr.
Grewcock is a member of the Executive
Committee of the Corporation.
William L. Grewcock Mr. Grewcock has been a director of the 74
Corporation since August 1997. Mr.
Grewcock was Vice Chairman of Level 3 for
more than five years prior to April 1998.
Mr. Grewcock is also a director of Level 3.
Mr. Grewcock is a member of the
Compensation Committee of the Corporation.
Peter Kiewit, Jr. Mr. Kiewit has been a director of the 73
Corporation since August 1997. Mr. Kiewit
has been Of Counsel to the law firm of
Gallagher & Kennedy, Phoenix, Arizona,
for more than the last five years. Mr.
Kiewit is a member of the Audit Committee,
the Compensation Committee and is the
Chairman of the Executive Compensation
Subcommittee of the Compensation Committee
of the Corporation.
Allan K. Kirkwood Mr. Kirkwood has been a director of the 56
Corporation since August 1997. Mr.
Kirkwood has been an Executive Vice
President of the Corporation since July
1998. Mr. Kirkwood has been an Executive
Vice President of KPC since September 1998,
was a Senior Vice President of KPC from
October 1995 to September 1998 and was a
Vice President of KPC for more than five
years prior to October 1995. Mr. Kirkwood
is a member of the Executive Committee and
is the Chairman of the Audit Committee of
the Corporation.
Walter Scott, Jr. Mr. Scott has been a director and 68
Chairman Emeritus of the Corporation
since August 1997. Mr. Scott has been
the Chairman of the Board of Level 3
for more than the last five years. Mr.
Scott was the Chief Executive Officer of
Level 3 for more than five years prior to
August 1997. Mr. Scott is also currently a
director of Berkshire Hathaway Inc.,
Burlington Resources Inc., MidAmerican
Energy Holding Co., ConAgra, Inc.,
Commonwealth Telephone Enterprises, Inc.,
RCN Corporation, Valmont and Level 3. Mr.
Scott is the Chairman of the Compensation
Committee of the Corporation.
Kenneth E. Stinson Mr. Stinson has been President and a 57
director of the Corporation since August
1997 and Chairman and Chief Executive
Officer of the Corporation since March
1998. Mr. Stinson has been the Chairman
and Chief Executive Officer of KCG for more
than the last five years. Mr. Stinson was
Executive Vice President of Level 3 from
June 1991 to August 1997. Mr. Stinson is
also currently a director of ConAgra, Inc.,
Valmont and Level 3. Mr. Stinson is the
Chairman of the Executive Committee of the
Corporation.
George B. Toll, Jr. Mr. Toll has been a director of the 63
Corporation since August 1997. Mr. Toll
was an Executive Vice President of the
Corporation from August 1994 to June 1999.
Mr. Toll was an Executive Vice President
of KCG from April 1994 to June 1998, and
a Vice President of KPC from June 1992 to
August 1994.
The Board unanimously recommends a vote FOR the nominees identified above.
INFORMATION ABOUT THE BOARD OF DIRECTORS
Committees
The Board has an Audit Committee, a Compensation Committee
and an Executive Committee.
The Audit Committee recommends the selection of and reviews
the services provided by the Corporation's independent auditors,
consults with the independent auditors and reviews the need for
internal auditing procedures and the adequacy of internal
controls and reports and makes recommendations to the full Board.
The current Audit Committee members are Messrs. Kirkwood
(Chairman), Bay and Kiewit. The audit committee had four formal
meetings in 1999.
The Compensation Committee determines the compensation of
the Chief Executive Officer and reviews the compensation,
securities ownership, and benefits of the Corporation's executive
officers. The current Compensation Committee members are Messrs.
Scott (Chairman), Bay, Crowe, Kiewit and William Grewcock. The
Compensation Committee had two formal meetings in 1999.
The Compensation Committee has an Executive Compensation
Subcommittee. The Executive Compensation Subcommittee reviews and
approves or disapproves, all compensation of whatever nature to be
paid to the Chief Executive Officer of the Corporation and the
Corporation's next four highest paid executive officers (the
"Named Executive Officers"); establishes and administers
performance goals pursuant to the Corporation's executive bonus
plans, if any, adopted pursuant to Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"); and approves or
disapproves, on behalf of the Board, the creation of any new bonus
plans for the executive officers of the Corporation pursuant to
Section 162(m) of the Code. The current Executive Compensation
Subcommittee members are Messrs. Kiewit (Chairman) and Bay. The
Executive Compensation Subcommittee had three formal meetings in
1999.
The Executive Committee exercises, to the maximum extent
permitted by law, all powers of the Board between board meetings,
except those functions assigned to specific committees. The
current Executive Committee members are Messrs. Stinson
(Chairman), Cline, Colf, Bruce Grewcock and Kirkwood. In 1999,
the Executive Committee had one formal meeting and acted by
written consent in lieu of a meeting on six occasions.
The Corporation does not have a nominating committee. The
Certificate provides that the incumbent directors may nominate a
slate of directors for election at the annual meeting of
stockholders. On April 20, 2000, the incumbent directors
nominated the slate listed on pages 3-4 of this Proxy Statement.
In 1999, the Board had three formal meetings and acted by
written consent in lieu of a meeting on eight occasions. In 1999,
no director attended less than 75% of the aggregate of the total
number of meetings of the Board and the committees of which he
was a member.
Directors who are employees of the Corporation or its
subsidiaries do not receive directors' fees. Non-employee
directors are paid annual directors' fees of $30,000, plus $1,500
for attending each meeting of the Board, $1,200 for attending
each meeting of a committee of the Board and $1,500 for attending
the Corporation's annual operations meeting.
EXECUTIVE COMPENSATION
Summary Compensation Table
The table below shows the annual compensation of the Named
Executive Officers. In addition, annual compensation information
is also provided for George B. Toll, Jr. who resigned as
Executive Vice President of the Corporation in June 1999. The
Corporation does not currently have plans under which options,
stock appreciation rights, restricted stock awards, long-term
incentive compensation, profit sharing, or pension benefits are
held by the Named Executive Officers. As a result of the
Transaction, the Construction Business was distributed to the
Corporation. Although certain compensation payments for the
periods reflected below may have been made by Level 3, all such
payments related to the Construction Business. Therefore, for
presentation purposes, all payments are reported as if they were
made by the Corporation or its subsidiaries.
<TABLE>
Annual Compensation
---------------------------
<S> <S> <S> <S> <S>
Other Annual
Name and Principal Position Year Salary($) Bonus($)(1) Compensation ($)(2)
- --------------------------- ---- --------- ----------- -------------------
Kenneth E. Stinson 1999 656,207 1,500,000 109,780 (3)
Chief Executive Officer 1998 570,835 1,500,000 111,422 (4)
1997 476,670 900,000
George B. Toll, Jr. 1999 229,585 700,000
1998 290,921 650,000
1997 257,706 500,000
Allan K. Kirkwood
Executive Vice President 1999 300,768 400,000
1998 254,885 360,000
1997 221,250 310,000
Roy L. Cline
Executive Vice President 1999 295,890 365,000
1998 271,046 407,260
1997 257,670 223,667
Richard W. Colf
Executive Vice President 1999 302,229 250,000
1998 261,530 360,000
1997 234,750 310,000
Bruce E. Grewcock
Executive Vice President 1999 286,145 270,000
1998 226,415 175,000
1997 199,831 175,000
</TABLE>
- ---------------------------
(1) Bonuses reflect payments made in the specified year with
respect to performance in the prior year.
(2) Other Annual Compensation means perquisites and other
personal benefits received by each of the Named Executive
Officers, if, in the aggregate, in excess of the lesser of
$50,000 or 10% of their combined salary and bonus. No Named
Executive Officer other than Mr. Stinson received any Other
Annual Compensation in excess of the reporting threshold.
(3) In 1999, taxable income in the amount of $51,535 was
imputed to Mr. Stinson with respect to the non-business use of
corporate aircraft and taxable income in the amount of $57,430
was imputed with respect to his interest-free loan described below.
(4) In 1998, taxable income in the amount of $40,778 was
imputed to Mr. Stinson with respect to the non-business use of
corporate aircraft and taxable income in the amount of $70,644
was imputed with respect to his interest-free loan described below.
Director's Compensation
During 1999, each of the directors of the Corporation who
were not employed by the Corporation during 1999 received
directors fees consisting of an annual retainer of $30,000 and
fees of $1,500 for attending each Board meeting and $1,200 for
attending each committee meeting. Non-employee directors also
receive $1,500 for attending the Corporation's annual operations
meeting.
Certain Relationships and Related Transactions
On January 25, 1999, Kiewit Engineering Company, a
subsidiary of the Corporation, sold its 60% interest in an
aircraft to Elk Mountain Ventures, Inc., a corporation controlled
by Mr. Scott, for $10,800,000, the fair market value of the
aircraft interest. Kiewit Engineering Company acquired the
aircraft interest in a capital contribution from Level 3. Elk
Mountain Ventures, Inc. and a subsidiary of the Corporation are
parties to various aircraft operating agreements pursuant to
which the Corporation's subsidiary provides Elk Mountain with
aircraft maintenance, operations and related services. During
1999, Elk Mountain reimbursed a subsidiary of the Corporation
approximately $1.4 million in expenses incurred in connection
with the operation of Elk Mountain's aircraft. Elk Mountain also
paid the subsidiary of the Corporation a management fee of
approximately $44,000. A subsidiary of the Corporation provided
various construction related services to Walter Scott, Jr. during
1999. Mr. Scott paid that subsidiary approximately $4 million in
connection with those services.
A subsidiary of Level 3 and a subsidiary of the Corporation
are parties to various aircraft operating agreements pursuant to
which the Corporation's subsidiary provides Level 3's subsidiary
with aircraft maintenance, operations and related services.
During 1999, Level 3's subsidiary reimbursed a subsidiary of the
Corporation approximately $2.1 million in expenses incurred in
connection with the operation of Level 3's aircraft. Level 3 also
paid the subsidiary of the Corporation a management fee of
approximately $80,000.
Level 3 and a subsidiary of the Corporation are parties to
an amended mine management agreement pursuant to which the
Corporation's subsidiary provides mine management and related
services for Level 3's coal mining properties. During 1999, Level
3 paid a subsidiary of the Corporation approximately $33 million
in connection with services provided pursuant to such agreement.
Level 3 and a subsidiary of the Corporation are parties to a
contract for the construction of Level 3's North American
Intercity Network. Construction, which is expected to be
completed by the end of 2000, will cost an estimated $3 billion.
In 1999, Level 3 paid a subsidiary of the Corporation
approximately $699 million under this contract. In addition,
Level 3 has retained a subsidiary of the Corporation as the
general contractor for the construction of Level 3's campus
headquarters facility being built in Broomfield, Colorado. In
1999, Level 3 paid a subsidiary of the Corporation approximately
$100 million in connection with such activities.
In connection with the Transaction, the Corporation and
Level 3 entered into various agreements intended to implement the
Transaction, including a separation agreement and a tax sharing
agreement, pursuant to which the parties allocated certain
liabilities associated with their respective businesses and the
costs and other liabilities related to the Transaction.
The Corporation loaned George B. Toll, Jr. $800,000 during
1994 in connection with the purchase of a residence and
relocation expenses. The full principal amount of his demand note
payable to the Corporation is currently outstanding.
The Corporation provided the holders of its convertible
debentures with interest-free loans in connection with the
Transaction. The following is a list of directors and executive
officers who had outstanding interest-free loans from the
Corporation in excess of $60,000 during 1999, the largest
aggregate amount outstanding during 1999 and the amount, if any,
currently outstanding: (a) Kenneth E. Stinson -- $1,080,000
($700,000 currently); (b) Roy L. Cline -- $250,000 ($200,000
currently); (c) Bruce E. Grewcock -- $250,000 ($200,000
currently); (d) Allan K. Kirkwood -- $240,000 ($200,000
currently); (e) Richard W. Colf -- $150,000 ($100,000 currently);
(f) Kenneth M. Jantz -- $150,000 ($100,000 currently); (g)
Richard Geary -- $100,000 ($0 currently); (h) Stephen A. Sharpe -
- - $100,000 ($100,000 currently); and (i) John Brad Chapman --
$80,000 ($55,000 currently).
Valmont has retained a subsidiary of the Corporation as the
general contractor for the construction of Valmont's headquarters
facility in Omaha, Nebraska. In 1999, Valmont paid a subsidiary
of the Corporation approximately $7 million in connection with
such activities.
In 1999, Richard W. Colf acquired a used piece of
construction equipment from a subsidiary of the Corporation for
$80,000.
The law firm of Gallagher & Kennedy provided various legal
services to the Corporation and its subsidiaries during 1999.
Fees paid to Gallagher & Kennedy by the Corporation and its
subsidiaries did not exceed 5% of Gallagher & Kennedy's revenues
for 1999.
Bruce E. Grewcock is the son of William L. Grewcock.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee consists of Messrs. Bay, Crowe,
William Grewcock, Kiewit and Scott. Messrs. Scott and William
Grewcock are employees of the Corporation. Messrs. Scott, William
Grewcock and Crowe were formerly officers of the Corporation or
its subsidiaries.
A corporation controlled by Mr. Scott was a joint owner of
an aircraft with Kiewit Engineering Company and such
corporation's successor acquired Kiewit Engineering Company's
interest in such aircraft on January 25, 1999. That company also
paid Kiewit Engineering Company for certain aircraft related
expenses in 1999. In 1999, Level 3 paid several subsidiaries of
the Corporation for the construction of Level 3's North American
Intercity Network and campus headquarters facilities and for
certain mine management and aircraft related services. See
"Certain Relationships and Related Transactions."
Mr. Stinson is a director of Valmont.
Executive Compensation Subcommittee Report
The Executive Compensation Subcommittee is composed entirely
of "outside" directors as defined in Section 162(m) of the
Code. This Subcommittee is responsible for reviewing and
approving, on an annual basis, all compensation of whatever nature
to be paid to the Named Executive Officers.
The objectives of the Corporation's executive compensation
program are to (a) support the achievement of desired Corporation
performance, (b) provide compensation that will attract and
retain superior talent, (c) reward performance, and (d) align the
executive officers' interests with the success of the Corporation
by placing a portion of total compensation at risk. The executive
compensation program has two elements: salaries and bonuses. The
program provides base salaries which are intended to be
competitive with salaries provided by other comparable companies.
Bonuses are the vehicle by which executive officers can earn
additional compensation depending on individual, business unit,
and Corporation performance, subject to the Bonus Plan.
In 1999 the Board adopted, and the shareholders approved,
the Peter Kiewit Sons', Inc. 1999 Bonus Plan (the "Bonus Plan").
The Executive Compensation Subcommittee has determined that for
1999, the Performance Goals under the Bonus Plan have been met
and that maximum bonus amounts have been established. The
Executive Compensation Subcommittee uses its discretion to set
executive compensation at levels warranted in its judgment by
external, internal, or individual's circumstances.
In recognition of Mr. Stinson's contributions to the
Corporation's performance in 1999, the Executive Compensation
Subcommittee has approved a salary increase to $700,024 effective
April 1, 2000 and a bonus of $3,000,000, payable in 2000. A
number of factors were considered in setting Mr. Stinson's
compensation. These factors included meeting Bonus Plan
Performance Goals, the Corporation's overall performance, the
increase in the Corporation's stock formula price, as well as Mr.
Stinson's personal effort and accomplishments in managing the
Corporation and its businesses. After considering all of the
factors, the Executive Compensation Subcommittee felt the
approved compensation was well within a reasonable range.
The foregoing report has been furnished by the Executive
Compensation Subcommittee, Messrs. Bay and Kiewit.
Performance Graph
The following performance graph shall not be deemed to be
incorporated by reference by means of any general statement
incorporating by reference this Proxy Statement into any filing
under the Securities Act of 1933, as amended or the Securities
Exchange Act of 1934, except to the extent that the Corporation
specifically incorporates such information by reference, and
shall not otherwise be deemed filed under such acts.
The Corporation's Common Stock is not publicly traded. The
Corporation's Certificate contains a formula pursuant to which
the Common Stock is valued. As a result of the Transaction, the
Construction Business was distributed to the Corporation. Level
3's former Class C Stock was linked to the performance of the
Construction Business, and was valued pursuant to a formula
specified in Level 3's restated certificate of incorporation (the
"Level 3 Certificate"). Consequently, for presentation
purposes, the graph below compares the cumulative total return
(stock appreciation plus reinvested dividends) of Level 3's Class
C Stock for the three-year period 1995-1997, and the
Corporation's Common Stock for 1998 and 1999 (referred to in the
graph collectively as "Construction Stock"), with the Standard
and Poors' Composite 500 Index and the Dow Jones Heavy
Construction Index -U.S.
Pursuant to the Level 3 Certificate and the Certificate, for
all periods presented in the graph below, the Construction Stock
was valued at the formula value determined by the Level 3
Certificate or the Certificate, as the case may be, at the end of
its fiscal year, reduced by dividends declared during the
following year. For purposes of the graph, it has been assumed
that dividends were immediately reinvested in additional shares
of Construction Stock, although such reinvestment was not
permitted in actual practice. Although Level 3's and the
Corporation's fiscal years ended on the last Saturday in
December, the Construction Stock is compared against indexes
which assume a fiscal year ending December 31.
The graph assumes that the value of the investment was $100
on December 31, 1994, and that all dividends and other
distributions were reinvested.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG THE CONSTRUCTION
STOCK, THE S&P 500 INDEX AND THE DOW JONES HEAVY CONSTRUCTION INDEX-U.S.
[INSERT GRAPH]
1994 1995 1996 1997 1998 1999
- -----------------------------------------------------------------
Construction Stock 100 129 165 210 262 337
S&P 500 Index 100 138 169 226 290 351
Dow Jones Heavy
Construction Index 100 140 133 100 104 98
- -----------------------------------------------------------------
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The table below shows information about the ownership of
Common Stock as of April 20, 2000, by the Corporation's
directors, nominees for director, the Named Executive Officers
and each person who beneficially owns more than 5 percent of the
Common Stock. The table also shows the ownership of Common Stock
by all of the directors and executive officers as a group as of
such date.
Number of Shares
Name Beneficially Owned Percent of Shares
- ------------------------ -------------------- ------------------
Kenneth E. Stinson (1)(2) 2,770,968 8.7%
Richard W. Colf (3) 1,715,960 5.4%
Allan K. Kirkwood 1,207,664 3.8%
George B. Toll, Jr. 1,140,824 3.6%
Bruce E. Grewcock 911,336 2.9%
Richard Geary 717,780 2.3%
Roy L. Cline 553,416 1.7%
Walter Scott, Jr. 400,000 1.3%
William L Grewcock 8,192 *
Mogens C. Bay 2,000 *
James Q. Crowe 2,000 *
Peter Kiewit, Jr. 2,000 *
Directors and Executive
Officers as a Group
(19 Individuals)(1) 10,011,336 31.4%
- ----------------------------
* Less than 1%.
(1) Includes the 766,773 shares of Common Stock held in trusts, for
which Mr. Stinson is the trustee with sole voting and investment powers.
(2) Mr. Stinson's address is c/o Kiewit Plaza, Omaha, Nebraska 68131.
(3) Mr. Colf's address is c/o 215 V Street, Vancouver, Washington 98661.
OTHER INFORMATION
Other Matters
It is not anticipated that any matters other than those
described in this Proxy Statement will be brought before the
Annual Meeting. If any other matters are presented, however, it
is the intention of the persons named in the proxy to vote the
proxy in accordance with the discretion of the persons named in
the proxy.
Stockholder Proposals
Any proposal which a Stockholder intends to present at the
2001 Annual Meeting must be received by the Corporation on or
before March 7, 2001 and by December 23, 2000 to be included in
the proxy material of the Corporation relating to such meeting.
In addition, if the Stockholder wishes to nominate one or more
persons for election as a director, such Stockholder must comply
with additional provisions as set forth in the Corporation's By-
Laws. Generally, a Stockholder must give timely notice to the
Secretary of the Corporation. To be timely, such notice must be
received by the Corporation at its principal executive offices
not less than sixty days prior to the meeting. The By-Laws
specify the information which must accompany such Stockholder
notice, including the provision of certain information with
respect to the persons nominated for election as directors and
any information relating to the Stockholder that would be
required to be disclosed in a Proxy Filing. Details of the
provision of the By-Laws may be obtained by any Stockholder from
the Secretary of the Corporation. Any such proposals should be
directed to the Secretary, Peter Kiewit Sons', Inc., Kiewit
Plaza, Omaha, Nebraska 68131.
Accountants
PricewaterhouseCoopers, certified public accountants, have
been selected by the Board as the independent public accountants
for the Corporation. Representatives of PricewaterhouseCoopers
are expected to be present at the Annual Meeting and will have
the opportunity to make a statement and to respond to appropriate
questions.
Section 16(a) Beneficial Ownership Compliance
Section 16(a) of the Securities Exchange Act of 1934
requires the Corporation's directors, executive officers and
persons who own more than 10% of the Common Stock to file reports
of ownership and changes in ownership with the United States
Securities and Exchange Commission ("SEC"). SEC Regulations
require the Corporation to identify anyone who filed a required
report late during the most recent fiscal year. The Corporation
undertakes to make such filings for its directors and executive
officers and in 1999 inadvertently filed a director's initial
statement of beneficial ownership report relating to his
appointment to the Board approximately 2 weeks late.
Annual Report
The Corporation is mailing to each Stockholder, along with
this Proxy Statement, a copy of its annual report. The
Corporation's annual report is its Form 10-K for the fiscal year
ending December 25, 1999, as filed with the SEC.
THE CORPORATION WILL FURNISH WITHOUT CHARGE UPON THE WRITTEN
REQUEST OF A STOCKHOLDER A COPY OF THE CORPORATION'S ANNUAL
REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS,
SCHEDULES, AND EXHIBITS, FILED WITH THE SEC. WRITTEN REQUESTS
SHOULD BE ADDRESSED TO THE STOCK REGISTRAR AT KIEWIT PLAZA,
OMAHA, NEBRASKA 68131.
PETER KIEWIT SONS', INC.
April 21, 2000
PETER KIEWIT SONS', INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR
THE ANNUAL MEETING OF STOCKHOLDERS, JUNE 17, 2000
PROXY
The undersigned hereby appoints Douglas A. Obermier and Gregory
M. Broz, or either of them or their substitutes, as proxies, each
with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated below, all the
shares of Common Stock of Peter Kiewit Sons', Inc. held of record
by the undersigned at the close of business on April 20, 2000, at
the Annual Meeting of Stockholders to be held June 17, 2000, or
any adjournment or postponement thereof. In their discretion, the
proxies are authorized to vote upon such other business as may
properly come before the meeting.
This Proxy, when properly executed, will be voted in the manner
directed herein by the undersigned stockholder. If no direction
is made, this Proxy will be voted FOR the Board's nominees for
director. TO ENSURE YOUR REPRESENTATION AT THE ANNUAL MEETING,
YOU ARE URGED TO COMPLETE, SIGN AND DATE THIS PROXY AND RETURN IT
AS PROMPTLY AS POSSIBLE IN THE ENCLOSED POSTAGE-PREPAID ENVELOPE.
Proposal 1: Election of Directors
To elect the twelve nominees specified as follows as Directors:
Mogens C. Bay Richard Geary Allan K. Kirkwood
Roy L. Cline Bruce E. Grewcock Walter Scott, Jr.
Richard W. Colf William L. Grewcock Kenneth E. Stinson
James Q. Crowe Peter Kiewit, Jr. George B. Toll, Jr.
---- FOR ---- WITHHOLD
all nominees authority to vote
listed (except) for all nominees
as otherwise
specified below)
Instruction: To withhold authority to vote for any individual
nominee(s), write the name(s) of the nominee(s) on the lines below.
-------------------------------------------------
-------------------------------------------------
Please sign exactly as name appears below.
[Name of Shareholder]
- ------------------ ----------------------------------------
Date Signature
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE
ENCLOSED ENVELOPE.
