<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________.
Commission File Number 1-6805.
-----------------------------
BROWNING-FERRIS INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 74-1673682
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
757 N. ELDRIDGE
HOUSTON, TEXAS 77079
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (281) 870-8100.
<PAGE> 2
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Information required with respect to executive officers of the Company is
set forth under "Business - Executive Officers of the Company" in Part I of
this report.
The directors of the Company, their positions and offices, their
respective term of office as a director and their respective ages are as
follows:
<TABLE>
<CAPTION>
EXPIRATION
POSITIONS AND OFFICES SERVED AS A OF PRESENT
NAME WITH THE COMPANY DIRECTOR SINCE AGE* TERM
------------------------------ --------------------------- -------------- ---- ----------
<S> <C> <C> <C> <C>
William D. Ruckelshaus........ Chairman of the Board and 1987 66 1999
Director(1)
Bruce E. Ranck................ President, Chief Executive 1990 50 1999
Officer and Director(1)
John W. Alden................. Director(3)(8) 1998 57 2001
Gregory D. Brenneman.......... Director(2)(4)(6) 1997 37 2000
William T. Butler............. Director(1)(3) 1990 66 2001
Gerald Grinstein.............. Director(3)(5)(6) 1990 66 1999
Robert J. Herbold............. Director(4)(8) 1998 56 2001
Harry J. Phillips, Sr......... Director(1) 1970 68 2000
Joseph L. Roberts, Jr......... Director(2) 1991 63 2001
Marc J. Shapiro............... Director(4)(5)(7) 1994 51 2000
Robert M. Teeter.............. Director(2)(5)(6)(8) 1989 59 2000
Marina v.N. Whitman........... Director(3)(4) 1992 63 2001
</TABLE>
- ----------
*As of January 11, 1999.
(1) Member of the Executive Committee
(2) Member of the Corporate Responsibility Committee
(3) Member of the Compensation Committee
(4) Member of the Audit Committee
(5) Member of the Directors and Corporate Governance Committee
(6) Member of the Strategic Industry Development Committee
(7) Advisory Member of the Strategic Industry Development Committee
(8) Member of the Marketing Committee
2
<PAGE> 3
BACKGROUND OF DIRECTORS
Mr. Ruckelshaus was elected a director in June 1987 and Chairman of the
Board and Chief Executive Officer in September 1988. He stepped down as the
Company's Chief Executive Officer in October 1995, but remains as Chairman of
the Board. Mr. Ruckelshaus also serves as a director of Cummins Engine Company,
Monsanto Company, Nordstrom, Inc., Weyerhaeuser Company, Solutia Inc.,
Coinstar, Inc. and Gargoyles Inc.
Mr. Ranck was elected President and Chief Executive Officer in October
1995, having served as President and Chief Operating Officer of the Company
since November 1991 and as Executive Vice President (Solid Waste Operations
- --North America) from October 1989 until November 1991. Prior to that time, he
served as a Regional Vice President in one of the Company's former regions. He
also serves as a director of Furon Company.
Mr. Alden serves as Vice Chairman of United Parcel Service (UPS), a
position he has held since November 1996. He previously held the office of
Senior Vice President of Business Development, a position he held from 1986. He
has served as a director of UPS since 1988. He joined UPS in 1965 and spent the
majority of his career in customer service and sales positions prior to being
named National Customer Development Manager in 1978. He is a director of
Unistar Air Cargo, the joint venture between UPS and Yamoto Transport of Japan
to market cargo services for the U.S. - Japan trading lane.
Mr. Brenneman is currently President and Chief Operating Officer of
Continental Airlines, Inc., a position he has held since April 1995. He also
serves as a director of Continental Airlines, Inc. and as Vice Chairman of
Continental Micronesia and Continental Express. Prior to his joining
Continental Airlines, he was a partner in Bain & Company, Inc., a consulting
firm, where he specialized in corporate turnarounds.
Dr. Butler serves as Chancellor of Baylor College of Medicine in Houston,
Texas, where he previously served as President and Chief Executive Officer from
1979 until January 1996. He is also the past Chairman of the Association of
American Medical Colleges. Dr. Butler also serves as a director of C.R. Bard,
Inc. and Chairman of the Board of Lyondell Petrochemical Company.
Mr. Grinstein currently serves as Chairman of the Board of Delta Air Lines.
He also serves as a director of Sundstrand Corporation, Imperial Holly
Corporation, PACCAR Inc. and Vans, Inc. Mr. Grinstein served as Chairman, Chief
Executive Officer, President and a director of Burlington Northern Santa Fe
Corporation and Burlington Northern Railroad Company from 1989 until his
retirement in December 1995.
Mr. Herbold has served as Executive Vice President and Chief Operating
Officer of Microsoft Corporation since November 1994 and serves on its Executive
Committee. Prior to joining Microsoft, he served as Senior Vice President,
Advertising and Information Services, at The Procter & Gamble Company.
Mr. Phillips served as Chairman of the Board and Chief Executive Officer
of the Company from September 1980 until September 1988, when he was elected
Chairman of the Executive Committee. Mr. Phillips is a director of RFS Hotel
Investors, Inc., Buckeye Technologies, Inc., Buckman Laboratories, Morgan
Keegan Inc. and the National Commerce Bancorporation, Memphis, Tennessee.
Dr. Roberts is Senior Pastor of the Ebenezer Baptist Church in Atlanta,
Georgia. He also serves as a member of various civic organizations.
Mr. Shapiro currently serves as Vice Chairman, Finance and Risk Management
of The Chase Manhattan Bank. Before assuming his current role in September
1997, he was Chairman, President and Chief Executive Officer of Texas Commerce
Bank National Association, a subsidiary of The Chase Manhattan Corporation. He
also serves as a director of Weingarten Realty Investors, Santa Fe Energy
Resources, Inc. and Burlington Northern Santa Fe Corporation.
Mr. Teeter has served as President of Coldwater Corporation, a strategic
planning and public affairs consulting firm since 1988. He is also a director
of United Parcel Service, Bank of Ann Arbor, Durakon Industries, Inc. and
Optical Imagine Systems.
Dr. Whitman has served as Professor of Business Administration and Public
Policy at the University of Michigan since 1992. Previously, she spent thirteen
years at General Motors Corporation, six years as Vice President and Chief
Economist and seven years as Vice President and Group Executive, Public Affairs
Staffs. She currently serves as a director of The Procter & Gamble Company, The
Chase Manhattan Corporation, Alcoa Corporation and UNOCAL Corporation.
3
<PAGE> 4
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE.
Based solely upon a review of Forms 3 and 4 furnished to the Company during
its most recent fiscal year and Forms 5 furnished to the Company with respect
to its most recent fiscal year, the Company believes that all transactions by
reporting persons were reported on a timely basis.
ITEM 11. EXECUTIVE COMPENSATION
The following table sets forth certain information with respect to the
compensation of the Chief Executive Officer and each of the Company's four
other most highly compensated executive officers for the fiscal year ended
September 30, 1998 (collectively, the "named executive officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
- ---------------------------------- -------- ------------- ---------- ------------------- ----------- ------------- ----------------
(A) (B) (C) (D) (E) (F) (G) (I)
SECURITIES
UNDERLYING
RESTRICTED STOCK
OTHER ANNUAL STOCK OPTIONS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(1) COMPENSATION(2) AWARDS(3) (SHARES) COMPENSATION(4)
- ---------------------------------- -------- ------------- ---------- ------------------- ----------- ------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Bruce E. Ranck 1998 $ 800,000 -0- -0- $ 194,300 100,000 $ 4,000
President and 1997 600,000 126,700 -0- 158,400 38,000 4,000
Chief Executive Officer 1996 600,000 -0- -0- -0- 250,000 3,750
- ---------------------------------- -------- ------------- ---------- ------------------- ----------- ------------- ----------------
J. Gregory Muldoon 1998 534,000 181,700 -0- -0- 31,000 4,000
Executive Vice President 1997 437,000 128,600 -0- 53,500 18,500 4,000
and Chief Operating Officer 1996 365,800 -0- -0- -0- 176,000 3,750
- ---------------------------------- -------- ------------- ---------- ------------------- ----------- ------------- ----------------
Norman A. Myers 1998 534,000 129,800 -0- -0- 16,500 3,152
Executive Vice President 1997 508,000 126,500 -0- 52,600 15,500 2,992
and Chief Development Officer 1996 508,000 -0- -0- -0- 52,500 2,992
- ---------------------------------- -------- ------------- ---------- ------------------- ----------- ------------- ----------------
Jeffrey E. Curtiss 1998 383,000 93,100 -0- -0- 12,000 3,232
Senior Vice President and 1997 364,000 -0- -0- 137,200 11,000 3,070
Chief Financial Officer 1996 364,000 -0- -0- -0- 27,500 3,070
- ---------------------------------- -------- ------------- ---------- ------------------- ----------- ------------- ----------------
Rufus Wallingford 1998 383,000 46,600 -0- 58,100 12,000 4,000
Senior Vice President 1997 364,000 54,900 -0- 68,500 11,000 4,000
and General Counsel 1996 364,000 -0- -0- -0- 27,500 3,750
- ---------------------------------- -------- ------------- ---------- ------------------- ----------- ------------- ----------------
</TABLE>
- ----------
(1) At the beginning of fiscal 1998, Mr. Ranck elected to receive 50% of any
incentive compensation award in restricted shares, which included an
additional 25% share premium. Mr. Ranck subsequently declined to accept
his incentive compensation award for fiscal 1998. However, he was granted
6,588 restricted shares by the Compensation Committee which was equal to
the amount of restricted shares he would have received if he had not
waived receipt of the incentive compensation award. The bonus amount (i)
includes for Mr. Muldoon 25% of the cash award that he elected to defer
and (ii) excludes for Mr. Wallingford 50% of his incentive compensation
award that he elected to receive in restricted shares (see note (3) below
for details regarding the terms of the restricted shares).
(2) The named executive officers did not receive any perquisites or other
personal benefits in which the aggregate amount of such compensation
exceeded $50,000 or 10% of the total of his annual salary and bonus.
(3) On December 1, 1998, Mr. Wallingford was granted 1,969 restricted shares
of the Company's Common Stock based upon the percentage elected by him
under the Company's Convertible Annual Incentive Award Plan for fiscal
1998, which included an additional 25% stock premium. The restricted
shares issued to Messrs. Ranck (see note (1) above) and Wallingford are
restricted for a two-year period, during which time the officer cannot
sell, transfer, pledge or assign them, but as the registered holders of
4
<PAGE> 5
\ these shares, the officer can vote the shares and receive any dividends.
At the end of the two-year restricted period, taxable income will be
recognized in an amount to equal fair market value of the shares on that
date. The value of the restricted shares issued is based on the fair
market value of the Company's Common Stock which is the closing price of
the stock the trading day preceding date of grant. The number and value,
respectively, of the aggregate restricted share holdings as of September
30, 1998 for each named executive officer were as follows: Ranck: 4,370
shares, $132,200; Muldoon: 1,475 shares, $44,600; Myers: 1,450 shares,
$43,900; Curtiss: 3,785 shares, $114,500; and Wallingford: 1,890 shares,
$57,200.
(4) Consists of the amount of the Company's match for each named executive
officer under the BFI Employee Stock Ownership and Savings Plan.
STOCK OPTIONS GRANTED IN LAST FISCAL YEAR
The following table sets forth certain information concerning stock
options granted to the named executive officers in the last fiscal year:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
GRANT DATE
VALUE
INDIVIDUAL GRANTS
(B) (C) (F)
NUMBER OF PERCENTAGE GRANT DATE
SECURITIES OF TOTAL PRESENT
UNDERLYING OPTIONS (D) VALUE BASED
OPTIONS GRANTED TO EXERCISE (E) ON
(A) GRANTED EMPLOYEES IN PRICE EXPIRATION BLACK-SCHOLES
NAME (SHARES)(1) FISCAL YEAR (PER SHARE) DATE MODEL(2)
---------------------- -------------- -------------- -------------- -------------- ------------
<S> <C> <C> <C> <C> <C>
Bruce E. Ranck....... 100,000 5.1% $ 36.25 12/01/2007 $ 981,000
J. Gregory Muldoon... 31,000 1.6% 36.25 12/01/2007 304,100
Norman A. Myers...... 16,500 0.8% 36.25 12/01/2007 161,900
Jeffrey E. Curtiss... 12,000 0.6% 36.25 12/01/2007 117,700
Rufus Wallingford.... 12,000 0.6% 36.25 12/01/2007 117,700
</TABLE>
- ----------
(1) All options were granted on December 2, 1997 and were granted under the
Company's 1993 Stock Incentive Plan, of which 2,700 shares were allocated
as incentive stock options. Twenty-five percent of the above options
became exercisable one year after the date of grant and, subject to
certain acceleration provisions, 25% will become exercisable each year
thereafter on a cumulative basis.
(2) Based upon the Black-Scholes option valuation model, which estimates the
present dollar value of BFI Common Stock to be $9.81 per option share, as
adjusted for vesting schedule. The actual value, if any, an executive may
realize will depend on the excess of the stock price over the exercise
price on the date the option is exercised, so that there is no assurance
the value realized will be at or near the value estimated by the
Black-Scholes model. The assumptions underlying the Black-Scholes model
include (a) an expected volatility of 21.02% based on the prior two years
of quarter-end closing stock prices of BFI Common Stock, (b) a risk-free
rate of return of 5.86%, which approximates the 10-year Treasury bond
rate, (c) BFI Common Stock dividend yield of 1.88%, and (d) a six-year
period from time of grant until exercise.
5
<PAGE> 6
STOCK OPTIONS EXERCISED IN LAST FISCAL YEAR
The following table sets forth the aggregate option exercises during the
last fiscal year and the value of outstanding options at September 30, 1998 for
each of the named executive officers:
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND SEPTEMBER 30, 1998 OPTION VALUES
<TABLE>
<CAPTION>
(A) (B) (C) (D) (E)
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED
OPTIONS AT VALUE OF UNEXERCISED
SEPTEMBER 30, 1998 IN-THE-MONEY OPTIONS AT
SHARES (SHARES) SEPTEMBER 30, 1998(1)
ACQUIRED ON VALUE --------------------------------- ---------------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
-------------------- ------------- ------------ ---------------- ---------------- ---------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Bruce E. Ranck...... -0- $ -0- 660,150 267,250 $ 3,630,600 $ 137,800
J. Gregory Muldoon.. 61,000 711,900 147,625 138,875 86,700 65,500
Norman A. Myers..... -0- -0- 352,625 66,875 1,377,400 71,700
Jeffrey E. Curtiss.. -0- -0- 125,250 30,250 722,600 45,000
Rufus Wallingford... -0- -0- 62,500 32,000 173,300 14,100
</TABLE>
- ----------
(1) Computed based upon the difference between aggregate fair market value and
aggregate exercise price at September 30, 1998.
EMPLOYMENT AND SEVERANCE AGREEMENTS
Bruce E. Ranck and Norman A. Myers are each parties to employment
agreements with the Company. Their agreements provide for continuously renewing
five-year terms until age 65, and continuing year to year thereafter until
terminated by the Company or the employee. The agreements also provide for the
payment of minimum annual base salaries and for participation by the employee
in all Company benefit plans and programs. The current annual salary for
Messrs. Ranck and Myers is $800,000 and $534,000, respectively.
The employment agreements for Messrs. Ranck and Myers include provisions
governing part-time status, termination and change in control. If the Company
should terminate an agreement other than for cause (as defined in the
agreements), or the Company breaches the agreement, or the employee is not
elected and serving in his current capacity for the Company, or the employee's
duties or responsibilities are materially changed or diminished (without his
consent) from his current duties, the agreement may be terminated by either
party on a date five years after notice of termination is given. During that
ensuing period, the employee would continue his employment on a part-time basis
and be available to consult with the Company. Generally, the employee's
compensation while on part-time status would be 75 percent of the average of
the employee's compensation (including salary and bonus) for the two highest of
the three years prior to the employee going on part-time status. In the event
that Messrs. Ranck and Myers were terminated without cause during 1999 or if
the employee terminated the agreement because of a breach by the Company, his
annual compensation on part-time status would be approximately $638,800 and
$505,100, respectively, subject to an annual cost-of-living adjustment. As a
part-time status employee, he would continue to participate in the Company's
benefit plans and programs. The agreement with each employee also provides that
he may elect part-time status upon attaining the age of 62, at reduced annual
compensation, subject to an annual cost-of-living adjustment, but without any
participation in the Company's incentive compensation plans.
In the event of a change in control of the Company, the employee may elect
(within twelve months after the date of the change of control) to receive a
lump sum payment equal to three times the employee's average annualized
compensation (including salary, bonus and compensation that has been deferred
at the election of the employee; however, excluding any stock premium received
as deferred compensation) over the five taxable years preceding the tax year in
which the change in control occurs. If a change in control were to occur during
1999 and the election to take the change in control payment were made by
Messrs. Ranck and Myers, they would receive approximately $2,614,600 and
$2,325,100, respectively. The election by the employee to take the change in
control payment would be in lieu of other benefits and rights under such
employee's agreement, except, generally, amounts payable under pension,
insurance and similar plans, reimbursement for legal and other advisory
expenses and certain stock option and indemnification rights.
6
<PAGE> 7
J. Gregory Muldoon, Jeffrey E. Curtiss and Rufus Wallingford each has an
employment agreement with the Company, which has a continuously renewing
three-year term until age 65, unless sooner terminated by the parties. The
agreements provide for the payment of a minimum annual base salary and for
participation by the officers in all Company benefit plans and programs. The
current annual salary for Messrs. Muldoon, Curtiss and Wallingford is $534,000,
$395,000 and $395,000, respectively. The employment agreements include
provisions governing inactive status, termination and change of control. If the
Company should terminate the agreements other than for cause (as defined in the
agreements), the termination would be effective on the third anniversary of the
date of notice of termination (or, if sooner, when the officer reaches age 65),
and the officer would go on inactive status on the date of such notice. The
officer's compensation while on inactive status would be 75% of the base salary
that the officer was earning prior to such notice and the officer would
continue to participate in the Company's benefit programs. In the event of a
change of control of the Company and if the officer has not been placed on
inactive status by the Company or terminated for cause, then he may elect
(within sixty (60) days after the date of the change of control) to receive a
lump sum payment equal to three times his average annualized compensation
(including salary, bonus and compensation that has been deferred at the
election of the employee; however, excluding any stock premium received as
deferred compensation) over the five taxable years preceding the tax year in
which the change of control occurs. If a change of control were to occur during
1999 and Messrs. Muldoon, Curtiss and Wallingford elected to take the change of
control payment, they would receive approximately $2,512,900, $1,337,900 and
$1,454,600, respectively. Such lump sum payments would terminate all of the
officers' rights under their agreements, except, generally, certain
indemnification rights and legal expenses.
RETIREMENT AND RESTORATION PLANS
The Company's defined-benefit retirement plan (the "Plan") covers all
employees of the Company located in the United States, except certain employees
subject to collective bargaining agreements and certain other employees covered
by other plans not made a part of the Plan. Certain employees are also covered
by either the BFI Benefit Restoration Plan or the BFI Cash Balance Restoration
Plan.
Generally, the Plan provides that, on December 31 of each year, account
balances established for each eligible employee are credited in an amount equal
to a percentage of the salary and bonus received by such employee during the
period beginning January 1 and ending December 31 of that year. Prior to June
1, 1998, the salary credit of participants under the Plan was equal to 4.5%;
however, during fiscal 1998 the Plan was amended to reduce the salary credit to
2% effective June 1, 1998. Currently, the balance in each employee's account
earns interest at a rate of 6% per year. The normal retirement age under the
Plan is 65 with an early retirement option at age 55 with ten years of vesting
service. Benefits under the Plan vest after five years of vesting service.
The estimated annual benefits payable at age 65 (as a single life annuity)
for each named executive officer are as follows: Mr. Ranck, $311,000; Mr.
Muldoon, $191,000; Mr. Myers, $327,000; Mr. Curtiss, $36,000; and Mr.
Wallingford, $24,000. The projected age 65 annual benefits are lower than those
calculated for the prior year proxy disclosure due to the reduction in pension
accruals effective June 1, 1998.
Currently, the Internal Revenue Code limits the pension from the Plan to
$130,000 and limits the annual pay used to calculate pensions to $160,000;
these amounts are indexed annually to the changes in Social Security benefits.
If the annual pension to any person would be limited by Sections 415 or
401(A)(17) of the Internal Revenue Code, such amounts otherwise payable to the
Plan participant pursuant to the Plan may be paid directly to such participant
by the Company, depending on whether he is also a participant of either of the
BFI Benefit Restoration Plan or the BFI Cash Balance Benefit Restoration Plan.
The purpose of the BFI Benefit Restoration Plan is to pay all participants in
the plan the full retirement benefit otherwise payable to them but for the
benefit limitations imposed by Section 415 and the pay limitation imposed by
Section 401(A)(17) of the Internal Revenue Code. The purpose of the BFI Cash
Balance Restoration Plan is to pay all participants in the plan the retirement
benefit otherwise payable but for the benefit limitation imposed by Section
401(A)(17) of the Internal Revenue Code.
DIRECTOR COMPENSATION
In fiscal 1998, non-employee members of the Board of Directors were paid
an annual retainer fee of $30,000, $20,000 of which was paid in cash and
$10,000 of which was paid in shares of the Company's Common Stock. In addition,
non-employee directors may be compensated in varying annual amounts for
participation on committees. Employee-directors of the Company do not receive
any additional compensation from the Company for their service as directors.
Members of the Audit Committee receive $8,000 (Chairman receives $12,000);
Compensation Committee members receive $6,000 (Chairman receives $9,000); the
non-employee director member of the Executive Committee receives $10,000
(Chairman is an employee-director); and the Corporate Responsibility
7
<PAGE> 8
Committee, the Directors and Corporate Governance Committee, the Marketing
Committee and the Strategic Industry Development Committee members receive
$4,000 (Chairman of each committee receives $6,000). An advisory member of the
Strategic Industry Development Committee also receives $4,000. In addition,
non-employee directors are paid attendance fees of $1,000 for each meeting of
the Board of Directors and $500 for each committee meeting.
Under the Company's Non-Employee Director Stock Plan, each non-employee
director is granted a non-qualified option to purchase 5,000 shares of the
Company's Common Stock upon his or her initial election or appointment to the
Board of Directors. Thereafter, each non-employee director receives an annual
option grant for the purchase of 2,500 shares of the Company's Common Stock.
The Company also has a Deferred Compensation Plan for its directors.
Participating directors may elect to defer all or a portion of their director
fees that are paid in cash in (i) an unfunded interest bearing account, (ii) a
BFI phantom stock account that earns dividend equivalents or (iii) other
investment options as offered in the Company's Employee Stock Ownership and
Savings Plan. A director may elect to receive cash distributions from his or
her account either prior to or following termination of service.
As part of its corporate charitable giving program, the Company makes cash
contributions directly to various charitable organizations, including
organizations with which certain directors are affiliated. The Company does not
consider these contributions to be compensation to the directors who are
affiliated with such organizations. The Company's charitable giving program
does not include any "director legacy" donations.
8
<PAGE> 9
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth, as of January 11, 1999, the amount of the
Company's Common Stock beneficially owned by each of its directors and nominees
for director, each executive officer named in the Summary Compensation Table,
and all directors, nominees for director and executive officers as a group:
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
-------------------------------------------------------
SOLE VOTING AND OPTIONS OTHER PERCENT
INVESTMENT EXERCISABLE BENEFICIAL OF
NAME POWER (1) WITHIN 60 DAYS OWNERSHIP CLASS
-------------------------------------- ----------------- ----------------- ----------------- -----------
<S> <C> <C> <C> <C>
William D. Ruckelshaus................ 97,299 66,250 2,472(2) *
Bruce E. Ranck........................ 110,318 770,900 6,195(2) *
J. Gregory Muldoon.................... 23,751 172,500 3,977(2) *
Norman A. Myers....................... 249,969 356,250 4,683(2) *
Jeffrey E. Curtiss.................... 47,835 139,125(3) 3,764(2)(4) *
Rufus Wallingford..................... 14,959 78,625 6,023(2) *
John W. Alden......................... -0- -0- -0- *
Gregory D. Brenneman.................. 624 3,125 -0- *
William T. Butler..................... 4,127 38,750 -0- *
Gerald Grinstein...................... 1,728 38,750 1,000(5) *
Robert J. Herbold..................... -0- -0- -0- *
Harry J. Phillips, Sr................. 367,943(6) 402,100 7,419(2)(7) *
Joseph L. Roberts, Jr................. 1,627 38,750 -0- *
Marc J. Shapiro....................... 4,627 11,250 -0- *
Robert M. Teeter...................... 3,627(8) 38,750(8) -0- *
Marina v.N. Whitman................... 3,627 38,750 -0- *
All Executive Officers, Nominees for
Director and Directors as a Group
(20 persons)........................ 972,314 2,558,950 44,643 2.1%
</TABLE>
- ----------
* Less than one percent
(1) Includes restricted shares of the Company's Common Stock. The holder has
sole voting power and no investment power until such restricted shares
vest. After vesting, the holder has sole investment and voting powers.
(2) Represents shares allocated to the employee through participation in the
Company's Employee Stock Ownership and Savings Plan, according to the
latest statement for said plan. Such shares can be voted by each employee,
and each employee has investment authority over the shares held in the
employee's account in such plan, except for shares acquired with Company
matching contributions. In the case of a tender offer, the trustee shall
tender or not tender shares as directed by each participant.
(3) Excludes options to purchase 15,000 shares of Common Stock which were
transferred by Mr. Curtiss to family trusts for which he is not trustee
and disclaims beneficial ownership therein.
(4) Includes 2,000 shares held by spouse in which Mr. Curtiss claims an
indirect ownership.
(5) Shares held jointly with spouse.
(6) Includes 292,334 shares held by a limited partnership of which Mr.
Phillips is sole general partner.
(7) Includes 877 shares held by spouse in which Mr. Phillips claims an
indirect ownership.
(8) All shares held in a trust of which Mr. Teeter serves as the trustee,
except for 330 restricted shares.
9
<PAGE> 10
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information concerning each person
known by the Company to own beneficially more than five percent of the
outstanding voting shares of the Company's Common Stock:
SHARES
NAME OF BENEFICIALLY PERCENT OF
BENEFICIAL OWNER OWNED CLASS
- ------------------------------------------------ -------------- -----
Fidelity Management and Research Corporation.... 11,005,705 (1) 7%
87 Devonshire Street
Boston, Massachusetts 02109-3605
Capital Research and Management Company......... 16,132,500 (2) 10%
333 South Hope Street
Los Angeles, California 90071-1447
- ----------
(1) Information is based on a Form 13F-E for September 30, 1998.
(2) Information is based on a Form 13-F for September 30, 1998.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Company stock option agreements allow the Company to purchase shares
of Company Common Stock that are received by officers and directors in
connection with the exercise of stock options. All such purchases are based on
the closing sales price of the Company's Common Stock on the last trading day
preceding the date of exercise. On December 3, 1998, the Company purchased
30,000 shares at $30.1875 per share from Mr. Myers in connection with an
exercise of a stock option that was expiring on December 6, 1998.
10
<PAGE> 11
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
BROWNING-FERRIS INDUSTRIES, INC.
(Registrant)
DATE: January 11, 1999 By: /s/ Bruce E. Ranck
-----------------------------------
Bruce E. Ranck
President, Chief Executive
Officer and Director
11
