<PAGE>
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 Section 240.14a-12
Bird Corporation
- - --------------------------------------------------------------------------------
(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] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
Notes:
<PAGE>
[LOGO]
BIRD
Corporation
JOSEPH D. VECCHIOLLA
Chairman of the Board
May 29, 1996
To Our Stockholders:
You are cordially invited to attend the special meeting in lieu of the annual
meeting of stockholders of Bird Corporation to be held on Friday, June 21,
1996, at 10:00 a.m. in the Midland Room of the Holiday Inn, 55 Ariadne Road (at
the junction of Route 1 South and Route 128), Dedham, Massachusetts. Coffee
will be available at the meeting site beginning at 9:30 a.m.
The Proxy Statement that accompanies this letter describes the matters that
will be presented at the meeting. I hope that you will be able to attend.
Regardless of the number of shares of common stock you may own, it is
important that they be voted at the meeting. THEREFORE, YOU ARE URGED TO VOTE,
SIGN, DATE AND MAIL THE ENCLOSED PROXY PROMPTLY, whether or not you plan to
attend the meeting in person.
Thank you for giving these materials your careful consideration.
Sincerely,
/s/ Joseph D. Vecchiolla
Joseph D. Vecchiolla
Chairman of the Board
BIRD CORPORATION, 1077 PLEASANT STREET, NORWOOD, MA 02062, TELEPHONE (617) 551-
0656
<PAGE>
BIRD CORPORATION
1077 PLEASANT STREET
NORWOOD, MA 02062
(617) 551-0656
----------------
NOTICE OF SPECIAL MEETING IN LIEU OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD
JUNE 21, 1996
Notice is hereby given that the special meeting in lieu of the annual
meeting of stockholders of Bird Corporation (the "Company") will be held on
Friday, June 21, 1996 at 10:00 a.m. in the Midland Room of the Holiday Inn, 55
Ariadne Road (at the junction of Route 1 South and Route 128), Dedham,
Massachusetts 02026 to consider and act upon the election of two directors to
the class of directors whose term expires in 1999 and to consider and act upon
such other business as may properly come before the meeting.
Reference is hereby made to the accompanying Proxy Statement for more
complete information concerning the matters to be acted upon at the meeting.
Holders of record of the common stock, par value $1 per share ("Common
Shares"), of the Company at the close of business on May 24, 1996 (the "Record
Date") are entitled to vote at the special meeting and any adjournments
thereof. All stockholders are invited to attend the meeting in person.
HOLDERS OF RECORD OF COMMON SHARES AS OF THE RECORD DATE ARE URGED TO VOTE,
SIGN, DATE AND RETURN THEIR PROXIES IN THE ENCLOSED ENVELOPE. NO POSTAGE NEED
BE AFFIXED IF MAILED IN THE UNITED STATES. HOLDERS OF RECORD OF COMMON SHARES
AS OF THE RECORD DATE WHO DO ATTEND THE MEETING AND WISH TO VOTE IN PERSON MAY
REVOKE THEIR PROXIES.
By order of the Board of Directors
Frank S. Anthony
Clerk
May 29, 1996
<PAGE>
BIRD CORPORATION
1077 PLEASANT STREET
NORWOOD, MA 02062
(617) 551-0656
----------------
PROXY STATEMENT FOR SPECIAL MEETING IN LIEU OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD
JUNE 21, 1996
This Proxy Statement is being furnished to holders of common stock, par
value $1 per share ("Common Shares"), as of the Record Date (defined below) of
Bird Corporation (the "Company"), a Massachusetts corporation, in connection
with the solicitation by the Company's Board of Directors (the "Board") of
proxies to be voted at the Company's special meeting in lieu of the annual
meeting of stockholders and at any adjournments thereof. The special meeting
is to be held on Friday, June 21, 1996, at 10:00 a.m. in the Midland Room of
the Holiday Inn, 55 Ariadne Road (at the junction of Route 1 South and Route
128), Dedham, Massachusetts.
SOLICITATION OF PROXIES
This Proxy Statement and the enclosed form of proxy are first being mailed
or otherwise furnished to stockholders of the Company on or about May 29,
1996. All expenses of this solicitation will be borne by the Company. Proxies
may be solicited by directors, officers or employees of the Company by mail,
telephone, in person or otherwise. No such person will receive additional
compensation for such solicitation. In addition, the Company will request
banks, brokers and other custodians, nominees and fiduciaries to forward proxy
materials to the beneficial owners of Common Shares and obtain voting
instructions from such beneficial owners. The Company will reimburse such
firms for their reasonable expenses in forwarding proxy materials and
obtaining voting instructions.
VOTING AND RECORD DATE
The Board of Directors has fixed May 24, 1996 as the record date (the
"Record Date") for determining the holders of Common Shares of the Company
entitled to receive notice of and to vote at the special meeting. At the
Record Date, there were 4,399,790 Common Shares issued and outstanding, each
of which entitles the holder thereof to one vote on each matter submitted to a
vote at the meeting.
The accompanying proxy card is intended to permit a holder of Common Shares
on the Record Date to vote at the special meeting on the election of directors
and on such other matters as may properly come before the meeting, whether or
not that stockholder attends the meeting. If the proxy card of a holder of
Common Shares is duly executed and returned, the shares represented thereby
will be voted in accordance with the voting instructions given on the proxy
card by the stockholder. If no such voting instructions are given on a proxy
card, the shares represented by that proxy card will be voted for the election
as directors of the nominees named herein and in accordance with the
recommendations of the Board of Directors on any other matters which may
properly come before the meeting. Holders of Common Shares may revoke their
proxies at any time prior to any vote at the special meeting by written notice
to the Clerk of the Company at or before the meeting, by submission of a duly
executed proxy card bearing a later date or by voting in person by ballot at
the meeting.
The presence at the special meeting, in person or by properly executed
proxy, of the holders of a majority of the Common Shares outstanding on the
Record Date will constitute a quorum. The affirmative vote of the holders of a
plurality of the Common Shares which are present in person or represented by
properly executed proxy at the special meeting is required to elect directors.
<PAGE>
ELECTION OF DIRECTORS
NOMINEES FOR DIRECTORS AND DIRECTORS CONTINUING IN OFFICE
The By-laws of the Company provide for a Board consisting of such number of
directors, not less than five nor more than 18, as shall be fixed from time to
time by the Board. The Board is divided into three classes, with each class to
hold office for a term of three years and the term of office of one class to
expire each year. The Board has fixed the number of directors to constitute
the full Board of Directors for the ensuing year at seven. The Board reduced
its size consistent with the downsizing of the Company in recent years and to
further reduce expenses.
The Board has nominated Antonio J. Lorusso, Jr. and Richard C. Maloof for
election to the class of directors whose term will expire in 1999. Mr. Lorusso
is President of S.M. Lorusso & Sons, Inc., the company that operates the
Company's quarry in Wrentham, Massachusetts. Mr. Maloof is the President and
Chief Operating Officer of the Company. Please see "LEGAL MATTERS" for a
discussion of certain legal proceedings affecting Mr. Maloof and the Company.
At its meeting on April 4, 1995, the Board adopted as a criterion for
nomination of members of the Board the understanding that no person would be
nominated who would be age 72 or older at or shortly after the time his
election became effective. Accordingly, John T. Dunlop and Guy W. Fiske, whose
terms expire in 1996, were not nominated for re-election. In order that the
number of directors in each class will be as equal as possible, consistent
with the requirements of the Company's By-laws and the Massachusetts Business
Corporation Law, Mr. Maloof, who is currently a director of the Company whose
term expires in 1998, intends to resign as a director immediately prior to the
special meeting so that, pursuant to the Board's nomination, he may stand for
election to the class of directors whose term will expire in 1999.
Shares represented by proxies will be voted for the election as directors of
Messrs. Maloof and Lorusso unless otherwise specified on the proxy card. If
either of the nominees for election to the Board of Directors should, for any
reason not now anticipated, not be available to serve as such, proxies will be
voted for such other candidate as may be designated by the Board of Directors
unless the Board reduces the number of directors. The Board of Directors has
no reason to believe that either nominee will be unable to serve if elected.
Stockholder nominations for directorships to be filled at the 1997 annual
meeting which are received by the Chairman of the Board no later than December
23, 1996 will be referred to the Nominating Committee for consideration.
The table below sets forth certain information with respect to those
directors whose terms of office will continue after the meeting, the current
executive officers of the Company and the nominees for election to the Board
of Directors.
<TABLE>
<CAPTION>
EXPIRATION
POSITION WITH THE COMPANY; FIRST OF PRESENT
PRINCIPAL OCCUPATION AND ELECTED OR TERM OF
NAME AND AGE OTHER BUSINESS AFFILIATIONS(1) APPOINTED(2) OFFICE
------------ --------------------------------- ------------ ----------
<S> <C> <C> <C>
Frank S. Anthony, 50........ Vice President, General Counsel 1984 N/A
and Corporate Secretary of the
Company since May 1984; Attorney;
formerly served in the law
department of Westinghouse
Electric Corporation from 1976 to
1983
Robert P. Bass, Jr., 72(3).. Director; Attorney, Counsel to 1961 1997
Cleveland, Waters and Bass, P.A.,
Concord, NH; Director of Bank of
New Hampshire Corp., Manchester,
NH
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
EXPIRATION
POSITION WITH THE COMPANY; FIRST OF PRESENT
PRINCIPAL OCCUPATION AND ELECTED OR TERM OF
NAME AND AGE OTHER BUSINESS AFFILIATIONS(1) APPOINTED(2) OFFICE
------------ --------------------------------- ------------ ----------
<S> <C> <C> <C>
Charles S. Bird, III, 71(3). Director; Trustee of family 1962 1998
trusts
Francis J. Dunleavy, 81..... Director; Retired Vice Chairman 1982 1997
of ITT Corporation; formerly
President, Chief Operating
Officer and Member of Executive
Committee of ITT Corporation;
Director of AEL Industries, Inc.,
Crown Cork & Seal Company, Inc.,
Quaker Chemical Corporation,
Scan-Graphics, Inc. and Selas
Corp. of America
Antonio J. Lorusso, Jr., 49. President of S.M. Lorusso & Sons, Nominee N/A
Inc., the company that operates
the Company's quarry located in
Wrentham, Massachusetts
Richard C. Maloof, 51....... Director; President and Chief 1994(4) 1998
Operating Officer of the Company
since April 1995; Vice President
and Chief Operating Officer of
the Company from April 1994 to
April 1995; Vice President of the
Company and President, Roofing
and Distribution Groups of the
Company for more than five years
prior thereto
Joseph D. Vecchiolla, 40.... Director; Executive Vice 1993 1997
President--Corporate Finance of
S. N. Phelps & Company and
affiliates since May 1995;
Chairman of the Board of
Directors of the Company since
April 1995; President and Chief
Executive Officer of the Company
from January 1994 to May 1995;
President, Chief Operating
Officer, Chief Financial Officer
and Acting Chief Executive
Officer of the Company from
November 1993 to January 1994;
Vice President and Chief
Financial Officer of the Company
from June 1993 to November 1993;
formerly Vice President and Chief
Financial Officer of Horizon
Cellular Telephone Company,
Malvern, PA and Executive Vice
President and Chief Financial
Officer of Educational Publishing
Corporation of Oak Lawn, IL
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
EXPIRATION
POSITION WITH THE COMPANY; FIRST OF PRESENT
PRINCIPAL OCCUPATION AND ELECTED OR TERM OF
NAME AND AGE OTHER BUSINESS AFFILIATIONS(1) APPOINTED(2) OFFICE
------------ --------------------------------- ------------ ----------
<S> <C> <C> <C>
Loren R. Watts, 61.......... Director; Retired Managing 1991 1998
Partner, Management Consultant
Services, Coopers & Lybrand
(certified public accountants)
</TABLE>
- - --------
(1) Includes business experience during past five years.
(2) At the 1990 annual meeting, the stockholders approved a reorganization
pursuant to which the then stockholders of Bird Incorporated became
stockholders of Bird Corporation, a newly organized Massachusetts
corporation, and Bird Incorporated became a wholly owned subsidiary of Bird
Corporation. This column indicates the date as of which a person was first
elected a director or appointed an officer of the Company or of Bird
Incorporated.
(3) Robert P. Bass, Jr. and Charles S. Bird, III are first cousins.
(4) Date first elected director.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the year ended December 31, 1995 the Board held seven meetings. Each
of the directors attended more than 75% of the aggregate of Board meetings and
meetings of committees of the Board of which he is a member.
The Audit Committee, which consisted during 1995 of Loren R. Watts
(Chairman), John T. Dunlop and Joseph D. Vecchiolla, meets periodically with
the Company's independent accountants to review the scope of the annual audit,
to discuss the adequacy of internal accounting controls and procedures and to
perform general oversight with respect to the accounting principles applied in
the financial reporting of the Company. The Audit Committee also meets with
the Company's internal auditor and reviews the scope of the internal audit
plan and the results of audits performed thereunder. The Audit Committee held
two meetings during 1995.
The function of the Stock Option, Compensation, and Organizational
Development Committee (the "Compensation Committee") is to administer the
Company's stock option plans, to recommend to the full Board the amount,
character and method of payment of compensation of all executive officers and
certain other key employees of the Company and to provide for organizational
development and succession planning. During 1995 the Compensation Committee
consisted of Robert P. Bass, Jr. (Chairman), Charles S. Bird, III, Francis J.
Dunleavy and John T. Dunlop. The Compensation Committee held three meetings in
1995.
The Company also has a Nominating Committee which, during 1995, consisted of
Francis J. Dunleavy (Chairman), Robert P. Bass, Jr. and Joseph D. Vecchiolla.
The Nominating Committee makes recommendations to and otherwise assists the
Board in connection with finding, evaluating and nominating directors of the
Company. The Nominating Committee held one meeting during 1995.
4
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table lists the stockholders known to management to be the
beneficial owners of more than 5% of the outstanding Common Shares as of April
1, 1996 (except as otherwise noted).
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF PERCENT
NAME AND ADDRESS BENEFICIAL OF
OF BENEFICIAL OWNER OWNERSHIP CLASS
- - ------------------- -------------- -------
<S> <C> <C>
The Entwistle Company .. 546,139 shares(1) 13.2%
Bigelow Street
Hudson, MA 01749
S.M. Lorusso & Sons,
Inc. .................. 332,121 shares(2) 8.1%
Antonio J. Lorusso, Jr.
James B. Lorusso
Samuel A. Lorusso
331 West Street
Walpole, MA 02081
Quest Advisory Corp. ... 329,950 shares(3) 8.0%
Charles M. Royce
1414 Avenue of the
Americas
New York, NY 10019
Mellon Bank Corporation
and its Subsidiaries .. 309,000 shares(4)(5) 7.5%
One Mellon Bank Center
Pittsburgh, PA 15258
Charles S. Bird, III ... 305,458 shares(5) 7.4%
13 Proctor Street
Manchester, MA 01944
FMR Corp. .............. 266,753 shares(6) 6.2%
Edward C. Johnson 3d
Abigail P. Johnson
82 Devonshire Street
Boston, MA 02109
Dimensional Fund
Advisors Inc. ......... 232,400 shares(7) 5.6%
1299 Ocean Avenue
11th Floor
Santa Monica, CA 90401
R. Keith Long .......... 208,500 shares(8) 5.1%
Financial Institutions
Insurance Group, Ltd.
Joan Greco and John Fyfe
Otter Creek Partners I,
L.P.
400 Royal Palm Way
Suite 400
Palm Beach, Florida
33480
</TABLE>
- - --------
(1) Based on information contained in an amended Schedule 13D filed with the
Securities and Exchange Commission (the "SEC") on April 1, 1987. The
Schedule 13D reports that The Entwistle Company had sole voting and
dispositive power with respect to all shares beneficially owned, including
8,539 shares it had the right to acquire upon conversion of the Company's
$1.85 Cumulative Convertible Preference Stock, par value $1 per share,
(the "Preference Shares").
(2) Based on information contained in a Schedule 13D amended through January
23, 1996 filed with the SEC. The Schedule 13D reports that S.M. Lorusso &
Sons, Inc. had sole voting power and dispositive power with respect to
230,121 shares. Antonio J. Lorusso, Jr., president, director and a
stockholder of S.M. Lorusso & Sons, Inc., had sole voting and dispositive
power with respect to 20,000 shares and had shared voting and
5
<PAGE>
dispositive power with respect to 79,500 shares and James B. Lorusso, an
officer, director and a stockholder of S.M. Lorusso & Sons, Inc., had sole
voting and dispositive power over 1,000 shares and Samuel A. Lorusso, an
officer, director and stockholder of S. M. Lorusso & Sons, Inc., had shared
voting and dispositive power with respect to 1,500 shares.
(3) Based on information contained in a Schedule 13G amended through February
14, 1996 filed with the SEC. The Schedule 13G reports that Quest Advisory
Corp. ("Quest") had sole voting and dispositive power with respect to
329,950 shares and that Charles M. Royce may be deemed a controlling
person of Quest and as such may be deemed to beneficially own the shares
although he disclaims such beneficial ownership.
(4) Based on information contained in a Schedule 13G amended through January
31, 1996 filed with the SEC. The Schedule 13G reports that Mellon Bank
Corporation had sole voting power with respect to 20,000 shares and sole
dispositive power with respect to 20,000 shares and that Mellon Bank
Corporation together with its subsidiaries, including Boston Safe Deposit
and Trust Company, had shared voting power with respect to 293,629 shares
and shared dispositive power with respect to 289,000 shares, including
274,929 shares referred to in footnote (5), below.
(5) Includes 274,929 shares held in a trust of which Boston Safe Deposit and
Trust Company and Charles S. Bird, III are co-trustees with shared voting
and dispositive power. See footnote (3) to the table below.
(6) Based on information contained in a Schedule 13G amended through February
14, 1996 filed with the SEC. The Schedule 13G reports as follows: FMR
Corp. and Edward C. Johnson 3d, chairman of FMR Corp. (who, with other
family members including Abigail P. Johnson, forms a controlling group
with respect to FMR Corp.), had sole voting power with respect to 8,900
shares, and FMR Corp., Edward C. Johnson 3d and certain investment
companies (the "Fidelity Funds"), which are subsidiaries of FMR Corp.
(including Fidelity Convertible Securities Fund), each had sole
dispositive power with respect to 257,853 shares. The sole power to vote
the 257,853 shares owned by the Fidelity Funds resides with the Fidelity
Funds' Boards of Trustees. Fidelity Management and Research Company, a
wholly owned subsidiary of FMR Corp., acts as investment advisor to the
Fidelity Funds and carries out the voting of the shares under written
guidelines established by the Fidelity Funds' Boards of Trustees. Of the
266,753 shares reported as beneficially owned by FMR Corp., as of December
31, 1995, 192,853 shares could be acquired upon conversion of Preference
Shares.
(7) Based on information contained in a Schedule 13G amended through February
7, 1996 filed with the SEC. The Schedule 13G reports that Dimensional Fund
Advisors Inc. ("Dimensional"), a registered investment advisor, is deemed
to have beneficial ownership of 232,400 shares as of December 31, 1995,
all of which shares are held in portfolios of DFA Investment Dimensions
Group Inc. (the "Fund"), or in series of the DFA Investment Trust Company,
a Delaware business trust (the "Trust"), each an open-end management
investment company registered under the Investment Company Act of 1940, or
the DFA Group Trust and DFA Participation Group Trust, investment vehicles
for qualified employee benefit plans, all of which Dimensional serves as
investment manager. The Schedule 13G reports that Dimensional had sole
voting power with respect to 154,900 shares (persons who are officers of
Dimensional also serve as officers of the Fund and the Trust and in their
capacities as officers of the Fund and the Trust, these persons vote
21,700 additional shares which are owned by the Fund and 55,800 shares
which are owned by the Trust) and sole dispositive power with respect to
232,400 shares. Dimensional disclaims beneficial ownership of all such
shares.
(8) Based on information contained in a Schedule 13D filed on March 8, 1996
jointly by Otter Creek Partners I, L.P. ("Otter Creek"), and R. Keith Long
on his own behalf and on behalf of Financial Institutions Insurance Group,
Ltd. ("FIIG"), and Joan Greco and John Fyfe, joint tenants with rights of
survivorship ("Fyfe") (together, the "Reporting Persons"). The Schedule
13D reports that Otter Creek Management Inc. ("OCM") is the sole general
partner and investment advisor of Otter Creek. Mr. Long is the sole
executive officer, sole director and sole shareholder of OCM and currently
serves as chairman of the Board of Directors of FIIG. Mr. Long also
manages discretionary stock trading accounts for FIIG and Fyfe.
Additionally, the Schedule 13D reports that each of Otter Creek, Mr. Long,
FIIG and Fyfe had sole voting and sole dispositive power with respect to
92,200, 20,000, 39,000 and 57,300 shares, respectively. The Reporting
Persons indicated in their Schedule 13D that they may, through one or more
designees, seek representation on the Board of Directors of the Company.
6
<PAGE>
The tables below set forth information provided by the individuals named
therein as to the amount of the Company's Common Shares, Preference Shares and
5% Cumulative Preferred Stock, par value $100 per share (the "5% Stock"),
beneficially owned by the directors, nominees for director and executive
officers of the Company, individually, and the directors, nominees for
director and executive officers as a group, all as of April 1, 1996 except as
otherwise noted. Unless otherwise indicated in the footnotes, each of the
named persons and members of the group had sole voting and investment power
with respect to the shares shown.
<TABLE>
<CAPTION>
COMMON
COMMON SHARES SHARES
BENEFICIALLY SUBJECT PERCENT
OWNED (EXCLUD- TO STOCK OF
NAME ING STOCK OPTIONS) OPTIONS(1) TOTAL CLASS
---- ------------------ ---------- --------- -------
<S> <C> <C> <C> <C>
Robert P. Bass, Jr............. 47,086(2) 17,500 64,586 1.6%
Charles S. Bird, III........... 292,858(3) 15,000 307,858 7.4%
Francis J. Dunleavy............ 1,000(4) 22,500 23,500 *
John T. Dunlop................. 2,000(5) 20,000 22,000 *
Joseph D. Vecchiolla........... 0 150,000 150,000 3.5%
Guy W. Fiske................... 6,000 22,500 28,500 *
Loren R. Watts................. 1,000 10,000 11,000 *
Antonio J. Lorusso, Jr. ....... 332,121(6) 0 332,121 8.1%
Frank S. Anthony............... 31,712(7) 31,000 62,712 1.5%
Joseph M. Grigelevich, Jr...... 6,726(8) 0 6,726 *
William C. Kinsey(9)........... 3,795 0 3,795 *
Richard C. Maloof.............. 37,563(10) 77,500 115,063 2.7%
All directors, nominees and
executive officers as a group
(12 persons).................. 761,861(11) 366,000 1,127,861 25.1%
</TABLE>
- - --------
* Less than 1% of the outstanding Common Shares.
(1) Represents shares which the individual has a right to acquire by exercise
of stock options exercisable on April 1, 1996 or within 60 days thereafter.
(2) Includes 16,000 shares as to which Mr. Bass shares voting and investment
power and 2,696 shares which may be acquired upon conversion of
Preference Shares.
(3) Includes 274,929 shares as to which Mr. Bird shares voting and investment
power (see table on page 5) and 3,595 shares which may be acquired upon
conversion of Preference Shares. Does not include 100 shares owned by his
wife, as to which he disclaims beneficial ownership.
(4) Does not include ten shares owned by a child of Mr. Dunleavy, as to which
he disclaims beneficial ownership.
(5) Represents shares as to which Mr. Dunlop shares voting and investment
power.
(6) Based on the information contained in a Schedule 13D amended through
January 23, 1996 filed with the SEC. Represents the total number of
shares owned by a group of which Antonio J. Lorusso, Jr. is a member. Mr.
Lorusso had sole voting and dispositive power with respect to 20,000
shares and had shared voting and dispositive power with respect to 79,500
shares. See table on page 5 and footnote (2) thereto.
(7) Includes 2,136 shares allocated to Mr. Anthony's account under the
Company's Employees Savings and Profit Sharing Plan (the "Savings Plan")
as of December 31, 1995.
(8) Includes 45 shares which may be acquired upon conversion of Preference
Shares and 6,481 shares allocated to his account under the Savings Plan
as of December 31, 1995. Mr. Grigelevich was an executive officer of the
Company until May 31, 1995, when his employment with the Company
terminated.
(9) Mr. Kinsey was an executive officer of the Company until March 8, 1995,
when his employment with the Company terminated.
(10) Includes 2,551 shares allocated to his account under the Savings Plan as
of December 31, 1995 and 625 shares held jointly with members of his
family.
(11) Includes 373,054 shares as to which persons included in the group have
shared voting and investment power, 6,336 shares which may be acquired
upon conversion of Preference Shares and 11,168 shares allocated to the
accounts of officers under the Savings Plan as of December 31, 1995.
7
<PAGE>
<TABLE>
<CAPTION>
PREFERENCE
SHARES PERCENT
BENEFICIALLY OF
NAME OWNED CLASS
---- ------------ -------
<S> <C> <C>
Robert P. Bass, Jr. ................................ 3,000 *
Charles S. Bird, III................................ 4,000 *
All directors, nominees and executive officers as a
group
(2 persons)........................................ 7,000 *
</TABLE>
--------
* Less than 1% of the outstanding Preference Shares.
<TABLE>
<CAPTION>
SHARES OF
5% STOCK PERCENT
BENEFICIALLY OF
NAME OWNED CLASS
---- ------------ -------
<S> <C> <C>
Charles S. Bird, III................................ 1,815 31%
All directors, nominees and executive officers as a
group
(1 person)......................................... 1,815 31%
</TABLE>
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers and persons who hold more than 10% of the
Company's Common Shares to file with the SEC reports of ownership and changes
in ownership of the Company's equity securities. Based on reports received by
the Company and representations of certain reporting persons that no Forms 5
were required, the Company believes that all filing requirements applicable to
its officers, directors and greater than 10% beneficial owners with respect to
fiscal year 1995 were complied with.
8
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information concerning the compensation paid
or accrued for services in all capacities to the Company during each of the
last three fiscal years to each person who served as chief executive officer
during 1995 and to each of the other four most highly compensated executive
officers of the Company who served as such during 1995.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
----------------------
ANNUAL
COMPENSATION OTHER
------------------ ANNUAL RESTRICTED SECURITIES ALL OTHER
NAME AND COMPEN- STOCK UNDERLYING STOCK LTIP COMPEN-
PRINCIPAL POSITION YEAR SALARY($) BONUS($) SATION($) AWARDS OPTIONS/SARS(#) PAYOUTS(1) SATION($)
- - ------------------ ---- --------- -------- --------- ---------- ---------------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Joseph D. Vecchiolla.... 1995 87,692 227,222 -- -- -- -- 663,781(2)
President and 1994 229,077 240,000 -- -- 50,000 37,449(3)
Chief Executive 1993 91,903 50,000 -- -- 100,000 39,912
Officer(4)
Richard C. Maloof....... 1995 195,962 46,416 -- -- 50,000 81,938 0
Vice President and 1994 180,223 45,450 17,992(5) -- 25,000 7,843(3)
Chief Operating 1993 161,629 11,300 8,873 -- -- 10,784
Officer(6)
William C. Kinsey....... 1995 29,600 36,919 -- -- -- 45,885 411,754(2)
Vice President; 1994 148,000 43,000 10,076(5) -- -- 9,986(3)
President, Bird 1993 138,792 10,000 5,460 -- -- 18,159
Vinyl Products(7)
Frank S. Anthony........ 1995 135,000 27,509 -- -- -- 49,163 150,000(2)
Vice President and 1994 141,750 30,000 10,795(5) -- -- 8,496(3)
General Counsel 1993 128,350 5,000 5,850 -- -- 11,381
Joseph M. Grigelevich,
Jr..................... 1995 46,069 31,476 -- -- -- -- 213,048(2)
Vice President Finance 1994 96,192 36,700 -- -- 20,000 5,943(3)
and Administration(8)
</TABLE>
- - --------
(1) In 1995 restrictions on all stock held in escrow pursuant to the Company's
Long Term Incentive Plan ("LTIP") lapsed as a result of the sale of the
Company's vinyl business located at Bardstown, Kentucky to Jannock, Inc. on
March 8, 1995 (the "Vinyl Sale") and shares were distributed to each of the
persons named in the table except Mr. Vecchiolla and Mr. Grigelevich.
(2) Represents severance payments received in connection with the change in
control which occurred pursuant to the Vinyl Sale. Also includes, in the
case of Mr. Vecchiola, $47,300 representing additional incentive
compensation related to the Vinyl Sale, the amount of which was deducted
from a severance payment which he received as a result of the Vinyl Sale.
(3) Represents contributions by the Company to the Savings Plan or in Mr.
Anthony's case to a separate trust established by the Company with a bank
trustee to which amounts in excess of those permitted to be contributed to
the Savings Plan under limits imposed by the Internal Revenue Code of
1986, as amended (the "Code"), are contributed. Also includes, in the case
of Mr. Vecchiolla, $31,825 representing additional incentive compensation
related to asset sales, the amount of which was deducted from a severance
payment which Mr. Vecchiolla received as a result of the change in control
of the Company which was deemed to have occurred upon consummation of the
Vinyl Sale.
(4) Mr. Vecchiolla was hired as Vice President and Chief Financial Officer
effective June 1, 1993 and was elected President and Chief Operating
Officer in November 1993. He served as acting Chief Executive Officer
during November and December 1993 and was elected Chief Executive Officer
on January 25, 1994. He resigned as President on April 1, 1995 and on that
date was elected Chairman of the Board. He resigned his full-time
employment and his office as Chief Executive Officer on May 25, 1995.
(5) Represents reimbursement for withholding taxes arising from the lapse of
restrictions on restricted stock held by each officer in accordance with
provisions of the LTIP. Does not include perquisites and other personal
benefits, the cost of which to the Company was below the disclosure
thresholds established by the SEC.
(6) Mr. Maloof was elected Chief Operating Officer in April 1994 and President
in April 1995. Prior to that time he served as Vice President and
President of the Company's Roofing and Distribution Groups.
(7) Mr. Kinsey's employment with the Company was terminated on March 8, 1995
as a result of the Vinyl Sale.
(8) Mr. Grigelevich first became an executive officer of the Company on March
21, 1994. Prior to that time he was treasurer of the Company. Mr.
Grigelevich's employment with the Company was terminated on May 31, 1995.
9
<PAGE>
The following tables provide information concerning grants during 1995 to,
and exercises of stock options and stock appreciation rights ("SARs") during
1995 by, the executive officers named in the Summary Compensation Table above
and the value of unexercised stock options and SARs held by them at December
31, 1995.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
--------------------------------------------------------------
NUMBER OF
SECURITIES
UNDERLYING PERCENT OF TOTAL EXERCISE GRANT DATE
OPTIONS OPTIONS GRANTED PRICE EXPIRATION PRESENT
NAME GRANTED(#) TO ALL EMPLOYEES ($/SHARE) DATE VALUE($)(1)
---- ---------- ---------------- --------- ------------ -----------
<S> <C> <C> <C> <C> <C>
Richard C. Maloof....... 50,000 100% 8.125 Apr. 3, 2005 $272,000
</TABLE>
- - --------
(1) This value was calculated using the Black-Scholes option pricing model and
the following assumptions, which were representative of conditions existing
when the options were granted: stock price volatility of 42.02%; risk free
rate of return of 7.32%; dividend yield of 0%; and time of exercise, ten
years. The actual value, if any, to be realized will depend on the excess of
the market price of the Common Shares over the exercise price on the date
the option is exercised; there is no assurance that the value realized will
be at or near the value estimated by the Black-Scholes model.
AGGREGATE OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS/SARS AT YEAR- IN-THE-MONEY OPTIONS/SARS
END(#) AT YEAR-END($)
-------------------------- -------------------------
SHARES VALUE
ACQUIRED ON REALIZED EXERCISABLE EXERCISABLE
NAME EXERCISE(#) ($)(1) (2) UNEXERCISABLE (2) UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Joseph D. Vechiolla..... 0 0 150,000 0 0 N/A
Richard C. Maloof....... 0 0 67,500 50,000 0 0
William C. Kinsey....... 2,000 6,500 0(3) 0 0 N/A
Frank S. Anthony........ 0 0 31,000 0 0 0
Joseph M. Grigelevich,
Jr. ................... 0 0 0(3) 0 0 N/A
</TABLE>
- - --------
(1) Based on the difference between the fair market value of the securities
underlying the options at date of exercise and the exercise price of the
options.
(2) Upon consummation of the Vinyl Sale on March 8, 1995, the vesting schedule
of all unvested options as of such date was accelerated and the holders
thereof became entitled to exercise such options in full or, in certain
cases in lieu of such exercise, cash out some or all of such options.
(3) Mr. Kinsey's and Mr. Grigelevich's employment with the Company terminated
as of March 8, 1995 and May 31, 1995, respectively. All options were
forfeited 90 days after termination of employment with the Company.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
Employment Contracts
Joseph D. Vecchiolla had been employed by the Company pursuant to a one-year
employment agreement dated December 21, 1993 which automatically renewed for
successive one-year terms as of December 1 each year thereafter unless either
the Company or Mr. Vecchiolla gave the other party at least six months' prior
notice that the agreement will not be so extended. Under the agreement, Mr.
Vecchiolla was initially employed to serve as President and Chief Operating
Officer of the Company. Effective January 25, 1994 his duties were expanded to
include those of Chief Executive Officer. His compensation under the agreement
included a base salary of not
10
<PAGE>
less than $200,000 per year, plus participation in the Company's management
incentive compensation plan (the "MICP") and other employee benefit plans and
programs generally available to its executive officers. Mr. Vecchiolla was
also granted a stock option under the employment agreement and was entitled to
certain relocation expenses incurred in connection with his employment by the
Company.
On April 4, 1995 Guy W. Fiske resigned as Chairman of the Board, and Mr.
Vecchiolla resigned as President and was elected Chairman of the Board. Mr.
Vecchiolla resigned as Chief Executive Officer and terminated his employment
with the Company in early May 1995, but continues to serve as an outside
director and as Chairman of the Board. Richard C. Maloof was elected President
and Chief Operating Officer of the Company on April 4, 1995. Subsequent to his
resignation as Chief Executive Officer Mr. Vecchiolla entered into a
consulting arrangement with the Company providing for an annual compensation
of $100,000, which included any fees payable to him for serving as a director.
Mr. Vecchiola's compensation was reduced to $60,000 per year on January 1,
1996.
Mr. Anthony entered into a one-year employment contract with the Company,
commencing April 1, 1995, at the same annual rate of compensation ($135,000
plus a bonus of 35% of such amount if MICP targets are obtained) and with the
same fringe benefit package (participation in the Company's Savings Plan and
customary health insurance and life insurance benefits) as he received prior
to the Vinyl Sale. As a result of the change in control which was deemed to
have occurred as a result of the Vinyl Sale, Mr. Anthony became entitled to
severance benefits. Pursuant to the terms of his employment contract, Mr.
Anthony received $150,000 as a partial severance payment and agreed to defer
the payment of the balance thereof until the expiration of his employment
contract. Pursuant to the terms of his contract, the balance of Mr. Anthony's
severance payment, approximately $315,000, became payable on March 31, 1996.
As of April 9, 1996, the Company had paid Mr. Anthony $267,000 and expects to
pay the balance of his severance payment by the end of June 1996.
On April 1, 1996 Mr. Anthony's employment contract automatically converted
to an oral employment agreement on the same terms, terminable by either party
upon 60 days notice.
Upon consummation of the Vinyl Sale, William C. Kinsey, a former vice
president of the Company and former president of Bird Vinyl Products, was
terminated by the Company due to a change in control. Mr. Kinsey received a
severance benefit payment of approximately $412,000. Similarly, the employment
of Joseph M. Grigelevich, Jr., a former vice president and treasurer of the
Company, was terminated on May 31, 1995 as a result of such change in control.
Mr. Grigelevich received a severance payment of approximately $213,048.
Termination of Employment and Change in Control Arrangements
The Company's 1982 Stock Option Plan (the "1982 Option Plan"), 1992 Stock
Option Plan (the "1992 Option Plan" and together with the 1982 Option Plan,
the "Plans") and 1992 Non-Employee Directors Stock Option Plan (the "Non-
Employee Directors Option Plan") provide for accelerated benefits, and the
Executive Severance Contract (defined below) provides for severance payments,
following the occurrence of a "change in control" of the Company. For purposes
of these plans and such contract, a "change in control" is deemed to have
occurred if, among other things, any person is or becomes the beneficial owner
of securities of the Company representing 30% or more of the combined voting
power of the securities of the Company then outstanding or in the event of a
merger or consolidation of the Company with another corporation resulting in
either (i) the shareholders of the Company, immediately prior to the merger or
consolidation, not beneficially owning, immediately after the merger or
consolidation, shares of the surviving entity representing 50% or more of the
combined voting power of the securities of the surviving entity then
outstanding or (ii) the members of the Board, immediately prior to the merger
or consolidation, not constituting, immediately after the merger or
consolidation, a majority of the Board of Directors of the surviving entity.
Executive Severance Contract. The Company has entered into a severance
agreement with Richard C. Maloof, the Company's President and Chief Operating
Officer, dated as of October 14, 1984, as amended, April 1, 1986, May 24, 1990
and August 21, 1995 (as so amended, the "Executive Severance Contract") the
terms of which provide for severance benefits to be paid to Mr. Maloof in the
event that his employment with the Company is terminated subsequent to a
"change in control" of the Company. Severance benefits are payable if, after a
"change in control," (i) the employment of Mr. Maloof is terminated either by
the Company (other
11
<PAGE>
than for "Disability" or "Cause," as such terms are defined under the
Executive Severance Contract) or by Mr. Maloof for "Good Reason" (which term,
under the Executive Severance Contract, includes, but is not limited to, a
substantial alteration in the nature of Mr. Maloof's responsibilities from
those in effect immediately prior to a "change in control") or (ii) Mr. Maloof
negotiates in good faith an employment agreement with a person to whom
substantially all of the Company's Common Shares are sold providing for his
employment commencing on the date of sale on such terms and conditions not
less generous than those on which he is then employed by the Company
(regardless of whether or not any such employment agreement is ever executed).
The Company has acknowledged that a "Change in Control" occurred under the
Executive Severance Contract as a result of the Vinyl Sale.
If the right to receive severance benefits is triggered under the Executive
Severance Contract, Mr. Maloof will be entitled to receive severance pay in
the amount of two times the sum of (i) Mr. Maloof's current annual base salary
and (ii) the amount of any bonus paid (which for severance purposes, includes
any distributions made under the terms of the LTIP and any discretionary
bonuses awarded to Mr. Maloof by the Compensation Committee of the Board based
solely on Mr. Maloof's performance against management objectives, and the
amount paid to Mr. Maloof pursuant to the MICP) to Mr. Maloof and the amount
paid to Mr. Maloof pursuant to the LTIP in the year preceding termination. In
addition, Mr. Maloof would also receive a lump sum benefit equal to any
incentive compensation or other award allocated, but not paid, to Mr. Maloof
for any prior year and a pro rata portion of all contingent bonus awards to
which Mr. Maloof might be entitled in the year of termination. The Company
estimates that if the right to receive severance benefits under the Executive
Severance Contract is triggered, Mr. Maloof would be entitled to receive
approximately $750,000.
Stock Option Plans and Non-Employee Directors Option Plan. Under the Plans,
the vesting of all options to purchase Common Shares outstanding but not yet
exercisable will be accelerated upon a "change in control." Each optionee will
have, for a period of thirty (30) days after the change in control occurs, the
right (the "Cash-Out Right"), with respect to all or a part of the shares
subject to the options or stock appreciation rights of such person, to receive
an amount in cash in lieu of such optionee's right to exercise all options in
full, equal to the product of (i) the number of shares as to which the
employee exercises the Cash-Out Right and (ii) the amount by which the
purchase price of each such share under the applicable option or stock
appreciation right is exceeded by the greater of (x) the fair market value of
such shares on the date the employee exercises the Cash-Out Right or (y) the
highest purchase price paid or offered per share in any bona fide transaction
related to the "change in control" of the Company at any time during the
preceding 60-day period (as determined by the Compensation Committee of the
Board). In addition, if the employment of any employee terminates after the
expiration of the applicable waiting period for the exercise of an option or
right granted to such employee under the Plans, such employee may for up to
three months after the date of termination (or for up to one year if
termination is on account of long-term disability), exercise such option or
right. The Plans provide for a similar one-year period to exercise options or
rights subsequent to the death of an employee occurring while in the employ of
the Company or of any subsidiary or within any period after termination of
employment during which such employee has the right to exercise such options
or rights.
Under the Non-Employee Directors Option Plan, any non-employee director
whose service on the Board is terminated by reason of disability, death or a
"change in control" will have the right to exercise all outstanding options
during the one-year period following such termination. In the event that
service on the Board is terminated for any reason other than disability, death
or a "change in control," such non-employee director will have the right to
exercise all outstanding options, to the extent exercisable at the time of
termination, for a period of 90 days from the date of such termination.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
For the fiscal year ended December 31, 1995, the Company paid fees and
disbursements in the amount of $1,619,494 to S.M. Lorusso & Sons, Inc. the
company that operates the Company's quarry located in Wrentham, Massachusetts.
Mr. Antonio J. Lorusso, Jr., a nominee for director, is president, director
and the principal stockholder of S.M. Lorusso & Sons, Inc. Based on Mr.
Lorusso's report on Schedule 13D, amended through January 23, 1996, Mr.
Lorusso is also the beneficial owner of 8.1% of the Company's Common Shares.
12
<PAGE>
LEGAL MATTERS
On or about April 18, 1996 Bird Incorporated, a subsidiary of the Company,
received a grand jury subpoena issued upon application of the United States
Department of Justice, Antitrust Division, for the production of certain
documents. In addition, Mr. Maloof and a senior manager of the Company have
received grand jury subpoenas requiring the production of certain documents
and each of them to testify before the grand jury. The Company, Mr. Maloof and
such senior manager are in the process of evaluating the subpoenas and intend
to cooperate fully with the Department of Justice. It appears that the
subpoenas relate to an investigation of the roofing materials industry.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee are Robert P. Bass, Jr.
(Chairman), Charles S. Bird III, Francis J. Dunleavy and John T. Dunlop. None
of these individuals, other than Mr. Bird, is or was formerly an officer or
employee of the Company, and no "compensation committee interlocks" existed
during 1995. Mr. Bird has not been an officer or employee of the Company since
1966.
DIRECTORS' COMPENSATION
Mr. Fiske received compensation through April 1, 1995 at the rate of
$100,000 per year for serving as Chairman of the Board and of the Executive
Committee. From April 1, 1995 through year-end, Mr. Vecchiolla received
compensation at the rate of $100,000 per year. As stated earlier, his
compensation was reduced to an annual rate of $60,000 on January 1, 1996.
During 1995 other non-employee members of the Board received an annual
retainer of $14,000, a fee of $750 for each Board meeting attended ($375 for a
telephonic Board meeting) and a fee of $750 for each committee meeting
attended ($375 for a telephonic committee meeting). The chairman of each of
the Audit and Compensation Committees received an annual retainer of $2,000.
Expenses incurred in attending meetings are reimbursed. As of January 1, 1996
the annual retainer for all non-employee Board members was reduced to $7,000
and the annual retainer for the chairman of each of the Audit and Compensation
Committees was reduced to $1,000.
Pursuant to the Non-Employee Directors Option Plan non-employee directors
are also entitled to receive each year a non-qualified stock option to acquire
2,500 Common Shares (provided that the maximum number of shares subject to
options granted to any director may not exceed 30,000 shares). Such options
are granted on the date of the annual meeting each year and become exercisable
in full one year later. During 1995 each non-employee director was granted
such an option at an exercise price of $6.625 per share.
REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee is responsible for compensation decisions with
respect to senior management of the Company, as well as for organizational
development and succession planning within the Company.
The Compensation Committee's compensation philosophy and policies applicable
to executive officers emphasize pay for performance and increased stockholder
value within a framework of compensation levels comparable to companies of
similar size. Base salary, annual MICP awards and long-term incentive awards
are structured to provide total compensation levels for executive officers
that are intended to be below competitive compensation amounts when operating
results are at or below acceptable levels and above average levels when
results are outstanding or other targets or personal goals are achieved. The
Compensation Committee has used outside consulting assistance for plan design
and consultant and independent survey data in setting compensation levels and
has relied, in the case of officers other than the Chief Executive Officer, on
recommendations of the Chief Executive Officer which are reviewed and modified
where appropriate by the Committee.
13
<PAGE>
Long-term awards have primarily in recent years taken the form of stock
option grants, which are designed to align the interests of executives with
those of the stockholders and reward executives when shareholder value
increases. Stock options are granted at an exercise price equal to the market
price of the Common Shares on the date of grant. Prior to 1992, options were
usually granted with a ten-year term, exercisable in five equal annual
installments beginning one year after the date of grant. However, options
awarded in 1992 and one option granted in 1993 were granted with a 15-year
term, exercisable prior to the last six months of the term only if the price
of the Common Shares achieved a substantial increase above the price on the
date of grant. In the case of 1992 and 1993 grants, a minimum price increase
in Common Shares from $12 per share to $18 per share was required in order for
any part of the option to become exercisable prior to the last six months of
the term of the option. This approach was designed as an incentive for future
performance by the creation of shareholder value over the long term, since the
benefit of the stock options could not be realized unless and until
significant price appreciation in the Common Shares occurred. Options granted
in 1994 were in the form used prior to 1992. All options outstanding at the
time of the Vinyl Sale automatically vested upon consummation of the sale,
which was deemed a "change in control" of the Company under the terms of the
option plans. No stock options were granted in 1995, other than to the non-
employee directors and to Mr. Maloof (as described below).
Salaries for the Chief Executive Officer and other executive officers are
based in part upon a range of salaries for each office developed from a survey
of compensation practices at competitive companies. Mr. Vecchiolla served as
Chief Executive Officer from January 25, 1994 until his resignation in early
May of 1995. Mr. Vecchiolla's base salary during 1995 was the same as his 1994
base salary of $240,000 annually. Subsequent to Mr. Vecchiolla's resignation
the position of Chief Executive Officer has remained vacant.
During 1995 merit increases in base salary were made only for Mr. Maloof.
The merit increase in Mr. Maloof's salary, from $185,000 to $200,000 annually,
was based primarily on increased scope of responsibility as a result of Mr.
Maloof's appointment as President.
In 1995 Mr. Maloof was the only executive officer granted stock options. He
received 50,000 stock options on April 4, 1995, which were granted in
connection with his appointment as President.
One of the principal elements of variable compensation for senior executive
officers is found in the annual MICP awards. In 1994, the possible pay-out for
1995 was set at 60% of base salary in the case of the Chief Executive Officer,
35% of base salary in the case of the Chief Financial Officer, between 20% and
35% of base salary in the case of other members of the corporate staff and 45%
of base salary in the case of Presidents of operating divisions. In 1994 the
MICP targets were modified to promote cash flow as well as profitability in
order to reflect the Company's financial condition and were maintained at such
1994 levels in 1995. 1995 awards to the Chief Executive Officer and corporate
staff and officers were based upon individual specific objectives, both
financial and non-financial, and satisfactory improvements in cash flow and
profitability through the management of current assets and the disposition of
non-core assets. At the operating level, management incentives were tied to
achievement of goals with respect to increased cash flow and profitability on
an equal 50/50 basis. For corporate personnel, including the Chief Executive
Officer, goals with respect to cash flow and profits were weighted at 40% each
with specific objectives making up the balance of the target.
During 1994 the Committee approved an additional bonus arrangement for Mr.
Vecchiolla to provide him with an incentive to maximize the value of the
Common Shares. This arrangement provided compensation to Mr. Vecchiolla equal
to one-tenth of one percent of the gross sales price realized on the sale of
the Company's assets after the approval of the bonus. However, in recognition
of the fact that the sale of a substantial part of the Company's assets would
be treated as a change in control of the Company which would trigger certain
severance payments to Mr. Vecchiolla, the Committee provided that this bonus
would be considered as an advance against such severance payments and that the
amount of the severance payments otherwise payable to him would be reduced by
the amount of the bonus paid. In 1995 Mr. Vecchiolla received $47,300 pursuant
to this bonus arrangement. This amount was subsequently deducted from a
severance payment received by him in connection with the Vinyl Sale.
14
<PAGE>
The Committee believes that the combination of salary increases and bonus
rewards was appropriate based upon the substantial progress made by management
in 1995 in turning around the Company's performance, stabilizing its financial
condition, disposing of its non-core assets and managing its contingent
liabilities.
Based on current compensation levels and the present structure of the
Company's executive compensation programs, the Committee believes that the
compensation payable to executives will not be subject to the limitation on
deductibility imposed by the Omnibus Budget Reconciliation Act of 1993. If
such limitation should become applicable in the future, the Committee and the
Company will determine whether any changes in the Company's compensation
programs are advisable.
Stock Option, Compensation, and
Organizational Development
Committee:
Robert P. Bass, Jr., Chairman
Charles S. Bird, III Francis J.
Dunleavy John T. Dunlop
15
<PAGE>
PERFORMANCE GRAPH
The following graph compares the cumulative total return on the Common
Shares of the Company for the last five fiscal years with the cumulative total
returns of the Russell 2000 index and the Value Line Building Materials
Industry Index, assuming an investment of $100 in the Common Shares and each
index at the close of trading on December 31, 1990 and the reinvestment of all
dividends. The total shareholder return data for the Russell 2000 Index and
the Value Line Building Materials Index is provided by Value Line
Institutional Services.
BIRD CORPORATION
CUMULATIVE TOTAL SHAREHOLDER RETURN FOR FIVE-YEAR PERIOD ENDING DECEMBER 31,
1995
[GRAPH APPEARS HERE]
<TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
AMONG BIRD CORPORATION, RUSSELL 2000 INDEX AND VL BUILDING MATERIALS INDEX
<CAPTION>
Bird Russell VL Building
Measurement period Corporation 2000 Materials
(Fiscal year Covered) Index Index Index
- - --------------------- ----------- ------- -----------
<S> <C> <C> <C>
Measurement PT -
12/31/1990 $ 100.00 $ 100.00 $ 100.00
1991 $ 108.36 $ 146.05 $ 131.25
1992 $ 84.28 $ 172.94 $ 168.41
1993 $ 62.34 $ 205.64 $ 233.98
1994 $ 63.74 $ 201.56 $ 178.10
1995 $ 34.43 $ 258.89 $ 245.71
</TABLE>
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP, the independent accountants for the Company, will have
a representative at the meeting who will be available to respond to
appropriate questions and who will be given the opportunity to make a
statement if he or she desires to do so.
STOCKHOLDER PROPOSALS FOR THE 1997 ANNUAL MEETING
Proposals of stockholders intended to be presented at the Company's 1997
annual meeting must be received by the Company no later than December 23,
1996. Proposals should be sent to the attention of Frank S. Anthony, Vice
President, at the Company's principal office at 1077 Pleasant Street, Norwood,
Massachusetts 02062.
16
<PAGE>
OTHER BUSINESS
The special meeting is called for the purposes set forth in the notice. The
Board of Directors does not know of any matter for action by the stockholders
at the meeting other than the matters described in the notice. However, the
enclosed proxy confers discretionary authority on the persons named therein
with respect to matters which are not known to the directors at the date of
printing hereof and which may properly come before the meeting. It is the
intention of the persons named in the proxy to vote in accordance with their
best judgment on any such matter.
By order of the Board of Directors
Frank S. Anthony,
Clerk
May 29, 1996
17
<PAGE>
BIRD CORPORATION
SPECIAL MEETING IN LIEU OF ANNUAL MEETING
OF STOCKHOLDERS -- JUNE 21, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned does hereby constitute and appoint Joseph D. Vecchiolla and
Frank S. Anthony, or either of them, the attorney(s) of the undersigned, with
full power of substitution, with all the powers which the undersigned would
possess if personally present, to vote all stock of Bird Corporation which the
undersigned is entitled to vote at the special meeting in lieu of the annual
meeting of stockholders of Bird Corporation to be held in the Midland Room of
the Holiday Inn, 55 Ariadne Road (at the junction of Route 1 South and Route
128), Dedham, Massachusetts 02026, on Friday, June 21, 1996 at 10:00 o'clock
a.m. and at any adjournment thereof, hereby acknowledging receipt of the Proxy
Statement for such meeting and revoking all previous proxies.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES FOR DIRECTOR
LISTED ON THE REVERSE SIDE AND, IN THE CASE OF OTHER MATTERS THAT LEGALLY COME
BEFORE THE MEETING, AS SAID ATTORNEY(S) MAY DEEM ADVISABLE.
CHANGE OF ADDRESS: __________________
_____________________________________
_____________________________________
_____________________________________
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
<PAGE>
Please vote, sign, date, and return the proxy card promptly using the
enclosed envelope.
Election of two directors whose terms expire in 1999.
NOMINEES: Richard C. Maloof and Antonio J. Lorusso, Jr.
[_] FOR all nominees [_] WITHHELD from all nominees
For, except vote withheld from the following nominees: [_] __________________
- - -------------------------------------------------------------------------------
CHECK HERE FOR ADDRESS CHANGE [_] CHECK HERE IF YOU PLAN TO ATTEND THE
MEETING [_]
Please sign name exactly as name
appears. When signing in a fiduciary
capacity, please give full title.
Co-fiduciaries and joint owners
should each sign.
Signature ___________________________
Date ________________________________
Signature ___________________________
Date ________________________________
