<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
UNR INDUSTRIES, INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $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:
------------------------------------------------------------------------
<PAGE>
[LOGO]
UNR INDUSTRIES, INC.
332 South Michigan Avenue
Chicago, Illinois 60604
------------------------------------------
NOTICE OF ANNUAL MEETING
OF SECURITYHOLDERS OF
UNR INDUSTRIES, INC.
---------------------------------
To the Stockholders and Warrantholders of UNR Industries, Inc.:
Notice is hereby given that the 1995 Annual Meeting of Securityholders ("Annual
Meeting") of UNR Industries, Inc., a Delaware corporation ("UNR" or "Company"),
will be held at the Bank of America Illinois, 231 South LaSalle Street, 21st
Floor, Chicago, Illinois, on May 4, 1995, at 10:00 a.m., local time, for the
purpose of considering and voting upon:
(1) Election of eight directors to serve until the 1996 Annual Meeting of
Stockholders or until their successors are elected and qualify;
(2) Approval of the 1994 Nonemployee Director Stock Ownership Plan;
(3) Ratification of the appointment of the firm of Arthur Andersen LLP as UNR's
independent public accountants for 1995; and
(4) Such other business as may properly come before the Annual Meeting.
The Board of Directors has determined that only UNR Stockholders and
Warrantholders of record at the close of business on March 23, 1995 are entitled
to notice of, and to vote at, the Annual Meeting or any adjournment or
postponement thereof. A list of such Stockholders and Warrantholders will be
available for examination by any such Stockholder or Warrantholder for any
purpose germane to the Annual Meeting for a period beginning ten days prior to
the Annual Meeting at The First National Bank of Chicago, One North State
Street, 11th floor, Chicago, Illinois 60602. ALL STOCKHOLDERS AND
WARRANTHOLDERS, WHETHER OR NOT THEY NOW EXPECT TO BE PRESENT AT THE ANNUAL
MEETING, ARE REQUESTED TO DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES USING THE ENVELOPE PROVIDED.
Any Stockholder or Warrantholder present at the meeting may vote personally on
all matters before the meeting, and in that event his or her proxy will become
void.
Your attention is directed to the following pages for further information
relating to the Annual Meeting.
By Order of the Board of Directors
Victor E. Grimm
SECRETARY
Chicago, Illinois
April 5, 1995
<PAGE>
UNR INDUSTRIES, INC.
332 South Michigan Avenue
Chicago, Illinois 60604
April 5, 1995
---------------------------------
PROXY STATEMENT
---------------------------------
GENERAL
The enclosed proxy is being solicited on behalf of the Board of Directors
(sometimes referred to as the "Board") of UNR Industries, Inc. ("UNR" or
"Company") for use at UNR's Annual Meeting of Securityholders ("Annual
Meeting"), notice of which accompanies this Proxy Statement, and at all
adjournments and postponements thereof. The Annual Meeting will be held at the
Bank of America Illinois, 231 South LaSalle Street, 21st floor, Chicago,
Illinois, on May 4, 1995 at 10:00 a.m., local time.
Any holder of Common Stock ("Stockholder") or any holder of a warrant
("Warrant") to purchase Common Stock ("Warrantholder") (Stockholders and
Warrantholders are referred to herein collectively as "Securityholders") giving
a proxy has the power to revoke it at any time prior to exercise thereof by
executing a subsequent proxy, by notifying UNR's Secretary of such revocation in
a written notice received by him at the above address prior to the Annual
Meeting, or by attending the Annual Meeting and voting in person.
Only Securityholders of record at the close of business on March 23, 1995 (the
"Record Date") are entitled to notice of, and to vote at, the Annual Meeting or
any adjournment or postponement thereof. At the close of business on the Record
Date, 51,671,872 shares of Common Stock and 594,380 Warrants were outstanding,
constituting the only outstanding voting securities. At the Annual Meeting,
Securityholders will be entitled to one vote for each share of Common Stock and
one vote for each Warrant held (shares of Common Stock and Warrants are
collectively referred to herein as "Securities").
A Securityholder may, with respect to the election of directors, (i) vote for
the election of all eight nominees named herein, (ii) withhold authority to vote
for all such director nominees or (iii) vote for the election of all such
director nominees other than any nominee or nominees with respect to whom the
Securityholder withholds authority to vote by so indicating in the appropriate
space on the proxy. A Securityholder may, with respect to each other matter
specified in the notice of the meeting, (i) vote "FOR" the matter, (ii) vote
"AGAINST" the matter or (iii) "ABSTAIN" from voting on the matter. Securities
will be voted as instructed in the accompanying proxy on each matter submitted
to Securityholders.
If no contrary instructions are indicated in the proxy, each proxy will be voted
FOR the election of the eight nominees to the Board of Directors named below or
for a substitute nominee if any of the nominees listed below become unable or
unwilling to serve, FOR approval of the 1994 Nonemployee Director Stock
Ownership Plan, and FOR ratification of the appointment of the firm of Arthur
Andersen LLP as UNR's independent public accountants for 1995, and, in the best
judgment of the persons named in the proxy as representatives, upon any other
matters which may properly come before the Annual Meeting.
1
<PAGE>
A proxy submitted by a Securityholder may indicate that all or a portion of the
Securities represented by such proxy are not being voted by such Securityholder
with respect to a particular matter. This could occur, for example, when a
broker is not permitted to vote Securities held in street name on certain
matters in the absence of instructions from the beneficial owner of the
Securities. The Securities subject to any such proxy which are not being voted
with respect to a particular matter (the "non-voted Securities") will be
considered Securities not present and not entitled to vote on such matter,
although such Securities may be considered present and entitled to vote for
other purposes and will count for purposes of determining the presence of a
quorum. Approval of each matter specified in the notice of the meeting requires
the affirmative vote of a majority, or in the case of the election of directors,
a plurality, of the Securities present in person or by proxy at the meeting and
entitled to vote on such matter. Accordingly, non-voted Securities with respect
to such matters will not affect the determination of whether such matters are
approved or the outcome of the election of directors. Directions to withhold
authority will not affect the outcome of the vote for directors. The Company's
By-Laws provide that Securities voted to abstain will be counted as present for
purposes of determining a quorum but will not be included in calculating the
vote on any matter.
The cost of the solicitation of proxies will be borne by UNR. UNR does not
expect to pay any compensation for the solicitation of proxies but will
reimburse brokers and other persons holding Securities in their names, or in the
names of nominees, for their reasonable out-of-pocket expenses incurred in
forwarding proxy materials to principals and obtaining their proxies.
SECURITIES OWNERSHIP
The following table sets forth information as of March 15, 1995 regarding
beneficial ownership of Securities by: (i) each person or group that has
reported beneficial ownership of more than five percent of the Common Stock or
Warrants outstanding, (ii) UNR executive officers and directors.
<TABLE>
<CAPTION>
COMMON STOCK (1)
------------------------
Number of
Shares
Beneficially Percent
Owned (2) of Class
----------- -----------
<S> <C> <C>
Principal Securityholder
UNR Asbestos-Disease Claims Trust (3) ................................ 29,437,004 56.2%
100 North Lincolnway
North Aurora, IL 60542
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
COMMON STOCK (1)
------------------------
Number of
Shares
Beneficially Percent
Owned (2) of Class
----------- -----------
Directors and Executive Officers
<S> <C> <C>
Charles M. Brennan, III............................................... 4,000 --
Darius W. Gaskins, Jr................................................. 41,000 --
Thomas A. Gildehaus................................................... 1,030,000 2.0%
Henry Grey............................................................ 555,824 1.1%
Victor E. Grimm....................................................... 273,738 --
Gene Locks............................................................ 5,000 --
Ruth R. McMullin...................................................... 20,075 --
Thomas F. Meagher..................................................... 3,000 --
Robert B. Steinberg................................................... 7,000 --
William J. Williams................................................... 7,000 --
All directors and executive officers as a group....................... 1,946,637 3.7%
<FN>
----------
(1) Beneficial ownership is as defined in rules of the Securities and Exchange
Commission and thus treats Common Stock issuable upon exercise of Warrants
and exercisable options as outstanding. Percentage ownership is not shown
for directors or officers owning less than one percent of the outstanding
Securities. No director or executive officer owned beneficially any
Warrants at March 15, 1995.
(2) Unless otherwise noted, the persons listed beneficially own all Securities
set forth opposite their respective names with sole power to vote and
dispose of such Securities, except Mr. Grey (33,333 shares) and Mr.
Meagher (3,000 shares) wherein voting or investment power is shared with
others. Mrs. McMullin's total also includes 3,700 shares held by her
spouse and 1,155 shares held for her son.
(3) The Trustees of the Trust are deemed to share beneficial ownership of the
29,437,004 Trust shares because they collectively possess the sole power
to vote and dispose of the Trust shares on behalf of the Trust, except
that the United States Bankruptcy Court for the Northern Division of
Illinois must approve sales of Trust shares.
</TABLE>
MATTERS TO BE ACTED UPON AT THE ANNUAL MEETING
PROPOSAL 1: ELECTION OF DIRECTORS
The eight persons listed below under "Background Information Regarding Nominees"
have been selected as nominees for election as directors by the Board of
Directors and, if elected, will serve until the next annual meeting or until
their successors are elected and qualify. If any nominee should be unable or
unwilling to serve, which is not now contemplated, the proxy holders may, but
will not be bound to, vote for a substitute nominee. UNR has been advised by the
Trust that it intends to vote its Common Stock for the election of the entire
slate of nominees listed below. The affirmative vote of the holders of a
plurality of the Securities present in person or by proxy at the Annual Meeting
and entitled to vote on the election of directors is required to elect the
nominees as directors.
3
<PAGE>
BACKGROUND INFORMATION REGARDING NOMINEES
The table below sets forth the names of the nominees for director, their
principal occupations during the last five years and certain other information.
<TABLE>
<CAPTION>
Director Principal Occupations for the Last Five Years,
Name of Nominee Since Age Other Directorships and Committee Assignments
-------------------------------- ----------- --- ---------------------------------------------------------------
<S> <C> <C> <C>
Charles M. Brennan, III......... 1989 53 Chairman (August, 1988 to present) and Chief Executive Officer
(October, 1989 to present) of The L.E. Myers Co. Group, an
electrical line contracting firm; Acting Secretary (April to
July, 1990) and Secretary (July, 1990 to September, 1992) of
UNR. Other directorships: The L.E. Myers Co. Group; Control
Devices, Inc. Chair of UNR's Audit Committee and member of
the Executive Committee.
Darius W. Gaskins, Jr........... 1990 55 Chairman, Leaseway Transportation Corp., a distribution
services provider (December 1994 to present); Senior Partner,
High Street Associates, a management and investment firm
(June, 1991 to present); Visiting Professor, Kennedy School
of Government, Harvard University (September, 1989 to June,
1991); President and Chief Executive Officer (December, 1985
to April, 1989) of Burlington Northern Railroad, a national
railroad operating company. Other directorships: Northwestern
Steel and Wire Company, a producer of steel and wire
products. Chair of UNR's Compensation Committee, and member
of the Executive Committee.
Thomas A. Gildehaus............. 1992 54 President and Chief Executive Officer of UNR (July, 1992 to
present); Executive Vice-President and Director of Deere &
Company, maker of agricultural, construction and grounds care
equipment (April, 1982 to April, 1992). Other directorships:
Bank of America Illinois, a banking company; Isys Controls
Inc., a manufacturer of scanning devices. Chair of UNR's
Executive Committee.
Gene Locks...................... 1989 57 Chairman of the Board of UNR Industries, Inc. (May, 1991 to
present); Founding partner, Greitzer & Locks, attorneys;
Chairman of the Official Creditors Committee of
Asbestos-Related Plaintiffs in the UNR Bankruptcy Court
proceedings (July, 1982 to May, 1989); Member of Trustees
Advisory Committee to UNR Asbestos-Disease Claims Trust
(June, 1989 to present); Chairman, Asbestos Victims' Special
Fund Trust (November, 1988 to present). Member of UNR's
Executive and Compensation Committees.
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Director Principal Occupations for the Last Five Years,
Name of Nominee Since Age Other Directorships and Committee Assignments
-------------------------------- ----------- --- ---------------------------------------------------------------
<S> <C> <C> <C>
Ruth R. McMullin................ 1990 53 Management Fellow (faculty member) Yale School of Management
(August, 1994 to present); President and Chief Executive
Officer, Harvard Business School Publishing Corporation
(November, 1991 to April, 1994); President and Chief
Executive Officer (March, 1989 to May, 1990), Executive Vice
President and Chief Operating Officer (April, 1987 to March,
1989) and Director (June, 1986 to May, 1990) of John Wiley &
Sons, Inc., a publishing and training company. Other
directorships: Bausch & Lomb, Inc., a health care and optics
company; Middlesex Mutual Assurance Company, a property and
casualty insurance company; Fleet Financial Group, a
financial services company. Member of UNR's Audit Committee.
Thomas F. Meagher............... 1989 64 Chairman and principal stockholder of Howell Tractor and
Equipment Company, a distributor of heavy-duty construction
equipment; Chairman, Continental Air Transport Company, Inc.,
an airport transfer company (1964 to 1994); President of
Grayline of Chicago, a sightseeing company (to December,
1990); Chairman of Tri-County Equipment Company, a
distributor of golf cart equipment, (1989 to 1993). Other
directorships: Greyhound Lines, Inc., a national intercity
bus transportation company; TransWorld Airlines, an
international air carrier. Member of UNR's Audit Committee.
Robert B. Steinberg............. 1989 66 Partner, Rose, Klein and Marias, attorneys; Member of the
Official Creditors Committee of Asbestos-Related Plaintiffs
in the UNR Bankruptcy Court proceedings (June, 1982 to May,
1989); Member of Trustees Advisory Committee to UNR
Asbestos-Disease Claims Trust (June, 1989 to present). Member
of UNR's Compensation Committee.
William J. Williams............. 1990 66 Retired Chairman (August, 1986 to September, 1993) and Chief
Executive Officer (August, 1986 to November, 1991) of The
Huntington National Bank. Other directorships: Huntington
Bancshares Incorporated, a bank holding company; Centerior
Energy Corporation, a public utility holding company;
Republic Engineered Steels, Inc., a producer of bar and
specialty steel. Member of UNR's Compensation Committee.
</TABLE>
5
<PAGE>
DIRECTORS' COMPENSATION
UNR employees who serve as directors of UNR receive no compensation for such
services. Non-employee directors of UNR are paid compensation at an annual rate
of $30,000 (the Chairman receives $50,000), payable in quarterly installments.
Non-employee directors receive $1,000 for each Board meeting or meeting of a
committee of the Board which they attend in person or by telephone. Directors
are also reimbursed for their out-of-pocket expenses incurred in connection with
such meetings.
BOARD MEETINGS; BOARD COMMITTEE FUNCTIONS AND COMPOSITION
The Board of Directors met four times during 1994. The Board has an Audit
Committee, a Compensation Committee and certain other committees. The Board does
not have a standing Nominating Committee. During 1994, no incumbent director
attended (in person or by telephone) fewer than 85% of the aggregate of (1) the
total number of meetings of the full Board during the period he or she served as
a director and (2) the total number of meetings held by all committees of the
Board on which he or she served during such period.
The Audit Committee consisted of Charles M. Brennan, III (Chair), Ruth R.
McMullin and Thomas F. Meagher. The Audit Committee makes recommendations to the
full Board of Directors regarding engagement of independent public accountants;
reviews and approves the scope of independent audits and the fees and other
arrangements regarding such services; reviews the results of the annual audit
with the independent public accountants; and generally reviews the adequacy of
UNR's accounting systems, internal accounting controls and applications of
accounting policies to new or unusual circumstances. The Audit Committee met
twice during 1994.
The Compensation Committee consisted of Darius W. Gaskins, Jr. (Chair), Gene
Locks, Robert B. Steinberg and William J. Williams and has responsibility for
considering and making recommendations to the full Board of Directors regarding
officers' compensation and benefits and UNR's organizational structure. The
Compensation Committee met four times during 1994.
6
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth the total cash and non-cash compensation in each
of the last three years for the Company's executive officers.
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
---------------------------------
Other --------------------------
Annual Restricted Securities
Compen- Stock Underlying
Salary Bonus sation Awards Options All Other
Name and Principal Position Year ($) ($)(2) ($)(3) ($)(4) (#)(5) Compensation($)
----------------------------------- ----------- --------- --------- ----------- ----------- ------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Thomas A. Gildehaus................ 1994 375,000 335,000 119,090 163,125 -- 70,126(6)
President and Chief 1993 337,500 330,000 -- 142,500 -- 49,883(6)
Executive Officer 1992(1) 150,000 150,000 -- 348,750 -- 1,429(6)
Henry Grey......................... 1994 190,100 131,000 66,161 59,375 -- 30,972(7)
Senior Vice-President and 1993 176,199 100,000 -- 63,649 -- 38,437(7)
Chief Financial Officer 1992 169,300 127,000 -- -- -- 22,208(7)
Victor E. Grimm.................... 1994 182,000 85,000 33,081 56,875 -- 26,373(7)
Vice-President 1993 161,875 95,000 -- 57,195 -- 13,432(7)
General Counsel 1992(8) 39,375 20,000 -- -- -- --
and Secretary
<FN>
------------
(1) Mr. Gildehaus' employment commenced on July 1, 1992 pursuant to an
employment agreement having a term of three years. For further details see
Employment Contracts and Change of Control Agreements on page 13.
(2) Bonus payments are made pursuant to the terms of the UNR Key Management
Incentive Variable Compensation Plan.
(3) Represents imputed annual interest at 7 3/4% (the prime rate on the date
of the loans) on interest-free loans to purchase stock under the 1994
Executive Stock Purchase Plan described under "Transactions with
Management" on page 14.
(4) Restricted Stock Awards are made pursuant to the terms of the UNR
Industries, Inc. 1992 Restricted Stock Plan. The stock is valued at the
closing price of the stock on the National Association of Securities
Dealers, Inc.'s Automated Quotation/ National Market System ("NASDAQ/NMS")
on the date of the award. On December 31, 1994 Mr. Gildehaus held 110,000
shares of restricted stock valued at $701,250. Mr. Gildehaus is entitled
to receive all dividends on restricted stock held by him. Mr. Gildehaus'
restricted stock is vested at the time of the award subject to forfeiture
within three years from the date of the award in the event of termination
of his employment by the Company for cause or by voluntary resignation.
The forfeiture restriction terminates as to a prorated portion of shares
in the event of a termination by the Company without cause or termination
by Mr. Gildehaus for good reason. The number of shares and the value of
the restricted stock held by Mr. Grey and Mr. Grimm, respectively, on
December 31, 1994 was 19,158 shares valued at $122,132 and 17,738 shares
valued at $113,080. Messrs. Grey and Grimm are entitled to receive regular
dividends on restricted stock held by them; extraordinary dividends are
paid in the form of additional restricted stock. Vesting occurs after five
years of continuous employment.
(5) No stock options were granted to executive officers in the years 1992,
1993 and 1994.
(6) The amounts shown for 1993 and 1994 include the Company's contributions to
Mr. Gildehaus' 401(k) plan of $3,148 and $2,703, respectively,
contributions to Mr. Gildehaus' account in the UNR Employees' Profit
Sharing Plan of $16,606 and $13,500, respectively, contributions to Mr.
Gildehaus' account in the UNR Industries, Inc. Supplemental Executive
Retirement Plan of $27,269 and $49,950, respectively, and annual life
insurance premiums of $2,860 and $3,973, respectively. The amount shown
for 1992 is for a life insurance premium.
(7) The amounts shown include the Company contributions to the individual's
401(k) plan and contributions to his account in the UNR Employees' Profit
Sharing Plan and the UNR Industries, Inc. Supplemental Executive
Retirement Plan. For Mr. Grey, the Company contributions to the 401(k)
plan for the years 1992, 1993 and 1994 were $2,471, $3,148 and $2,703,
respectively; contributions to the Profit Sharing Plan for the years 1992,
1993 and 1994 were $19,737, $16,606 and $13,500, respectively, and the
contributions to the Supplemental Executive Retirement Plan for 1993 and
1994 were $18,683 and $14,769, respectively. For Mr. Grimm, the Company's
contributions to the 401(k) plan for 1993 and 1994 were $1,574 and $2,703,
respectively; the contributions to the Profit Sharing Plan for the years
1993 and 1994 were $11,858 and $13,500, respectively, and the contribution
to the Supplemental Executive Retirement Plan for 1994 was $10,170.
(8) Mr. Grimm's employment commenced on October 1, 1992.
</TABLE>
7
<PAGE>
------------------------
COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
------------------------
The Compensation Committee is composed of four independent directors. No member
of the Committee is a former or current officer or employee of the Company or
any of its subsidiaries. The Committee formulates the compensation policy and
structure for executive officers, reviews salary and bonus recommendations for
those officers and submits its recommendations to the full Board of Directors
for approval. The Compensation Committee is solely responsible for determining
long term incentive compensation granted to executive officers under the stock
option, restricted stock and other long term incentive plans.
In formulating and implementing compensation programs, it has been the
philosophy of the Compensation Committee that a substantial portion of executive
compensation should be related to the Company's financial performance.
Accordingly, compensation programs have been structured to include incentives
based on measures of the Company's financial performance. In 1994, the Committee
placed greater emphasis on long term incentive plans designed to further align
management's economic interests with those of the Company's shareholders.
The compensation programs for executive officers consist of base salary and
short term and long term incentive compensation plans, all as described in the
following paragraphs.
BASE SALARY
The Committee annually reviews the base salary of each executive officer. In
determining salary adjustments, the Committee considers individual job
performance, length of employment, level of responsibility and information
supplied by an independent compensation consulting firm concerning the average
compensation levels of executive officers in a large group of companies
statistically adjusted for a company with sales of approximately $400 million
("Compensation Peer Group"). The Committee believes that the Compensation Peer
Group is a more appropriate comparison for compensation purposes than the peer
group used for computing total shareholder return (see "Company Performance
Graph" on page 12) which includes firms of substantially larger size than the
Company. The Chief Executive Officer's base salary is reviewed annually on July
1. In accordance with the Committee's decision to emphasize long term
incentives, no adjustment was made to the Chief Executive Officer's base salary
level in 1994. The base salary levels of the other executive officers are
reviewed on a calendar year basis. Base salaries for these officers were
increased an average of 6% for 1994, but for 1995 these base salaries are being
maintained at 1994 levels. Based upon the Compensation Committee's analysis and
upon the information provided by an independent compensation consultant, the
Committee believes that the 1994 base salary of the Company's Chief Executive
Officer is approximately 10% below the average, and the base salaries of the
other executive officers are approximately at the average, of firms in the
Compensation Peer Group.
SHORT TERM INCENTIVES
A significant part of short term executive compensation is based on the Key
Management Incentive Variable Compensation Plan (the "Short Term Incentive
Plan") which provides for a bonus consisting of a percentage of base salary
related to specific measures of the Company's performance. For fiscal year 1994,
the Short Term Incentive Plan included the following three components, each of
which was accorded equal weight: (a) operating profit, (b) return on assets, and
(c) cash flow. The amount of bonus awarded is based on the Company's performance
in each of these categories in relation to the Company's operating budget
approved at the beginning of each year by the Board of Directors. The
8
<PAGE>
amounts earned by executive officers are computed on a sliding scale beginning
with a percentage of base salary (ranging from 20% to 33.3% depending on the
executive's position) for achieving 80% of the budget amount for each component
and increasing to a larger percentage of base salary (ranging from 50% to 100%)
for achieving 120% of the budget amount. In 1994, target levels were exceeded
for each of the Company performance factors. In the aggregate, 1994 bonuses for
executive officers represented 91% of their total bonus opportunity under these
performance factors. In addition to these performance factors, 25% of the Chief
Executive Officer's bonus opportunity is based on the achievement of annual
personal goals, which are more fully described below. The Committee also has the
discretion under the Short Term Incentive Plan to adjust the amount of the bonus
up to 20% based on individual performance during the year. This discretionary
component allows the Compensation Committee to recognize achievements in job
performance not directly reflected in the other components. In the aggregate,
discretionary bonuses for executive officers represented 3.9% of their total
discretionary bonus opportunity in 1994.
LONG TERM INCENTIVES
The Company's long term incentive plans consist of Stock Option Plans, a
Restricted Stock Plan and a Stock Purchase Plan. The Compensation Committee
believes that management stock ownership is an effective tool in aligning the
financial interests of senior management with those of the Company's
shareholders and continues to use the Company's long term incentive plans as a
significant part of executive compensation programs. No grants were made under
the Stock Option Plan in fiscal year 1994 to named executive officers, but
awards were made under the Restricted Stock Plan. Restricted stock awarded to
the Chief Executive Officer is described below. Restricted stock awards to other
executive officers were based upon 30% of base salary divided by the fair market
value per share on the date of the grant. In granting these shares, the
Committee took into account previous awards of restricted stock. Restricted
stock issued to these officers pursuant to the Restricted Stock Plan vests after
five years of employment or in the event of death, disability, retirement or
certain defined events related to change of control of the Company.
In 1994, UNR stockholders approved the 1994 Executive Stock Purchase Plan (the
"Stock Purchase Plan"). The purpose of the Stock Purchase Plan is to encourage
and facilitate the acquisition of a larger financial interest in the Company
through direct stock purchase by key executives. Pursuant to the Stock Purchase
Plan, the executive officers of the Company purchased a total of 1,650,000
shares of common stock from the Company in 1994. These shares were purchased on
September 9, 1994 at a price of $5.525 per share. The purchase price was the
average of the average of the reported high and low prices for the Company's
common stock on the NASDAQ/NMS on each of the five trading days preceding the
purchase. These shares were paid for in cash in the amount of the par value of
the shares ($.01 per share) and the balance in promissory notes due in three
years. The notes are interest free (although for tax purposes interest is
imputed), except that in the event that a participant resigns from the Company
or is terminated for cause, the notes become due, and interest at the applicable
Federal rate under Section 1274 of the Internal Revenue Code is applied
retroactively from the date of the notes. If the shares are sold prior to three
years from the date of issuance, other than in connection with a change in
control of the Company, interest is applied retroactively from the date of the
notes at the applicable Federal rate. The proceeds of any such sale must be
applied against the principal (and any interest) owing on the notes. Dividends
on these shares, net of taxes, are applied to reduce the amounts outstanding on
the notes. The Committee believes that this level of stock ownership, along with
previous restricted stock awards, constitutes an appropriate level of ownership
by senior management and significantly enhances the incentive of these executive
officers to manage the Company to benefit all stockholders.
9
<PAGE>
CHIEF EXECUTIVE OFFICER COMPENSATION
Thomas A. Gildehaus became president and Chief Executive Officer of the Company
on July 1, 1992. At that time, the Company entered into an employment agreement
with Mr. Gildehaus for a term of three years. Under the agreement, annual base
salary for the first year was $300,000, subject to review and increase at the
end of each contract year. Effective July 1, 1993 Mr. Gildehaus' annual base
salary rate was established at $375,000. In keeping with the Committee's
philosophy of emphasizing incentive based compensation, no adjustment was made
in this salary level for 1994. Mr. Gildehaus' base salary is approximately 10%
below the average base compensation level for Chief Executive Officers in the
Compensation Peer Group.
The employment agreement provides for an incentive bonus based on the attainment
of performance goals to be established on an annual basis by mutual agreement
with Mr. Gildehaus. For fiscal year 1994, 75% of Mr. Gildehaus' bonus award was
based on the Company's performance in relation to the Short Term Incentive Plan
factors of operating profit, return on assets, and cash flow. The Short Term
Incentive Plan targets were exceeded in 1994 for each of these components. In
addition to the foregoing factors, Mr. Gildehaus' performance was evaluated in
relation to specific goals established for 1994, which included development and
implementation of a three year operating plan, development of plans for
redeployment of the Company's assets, achievement of a total shareholder return
of 25% greater than the S&P Stock Index and development and implementation of a
financial strategy allowing payment of extraordinary dividends to shareholders.
These factors were not ranked or weighted, and Mr. Gildehaus' performance in
relation to them is subjectively assessed by the Committee. Mr. Gildehaus was
awarded $335,000, or 89% of his total bonus opportunity for the foregoing
factors in 1994. The Committee also has discretion under the Short-Term
Incentive Plan to adjust the Chief Executive Officer's bonus up to 20%. The
Committee did not award him any discretionary bonus in 1994.
Under the Restricted Stock Plan, Mr. Gildehaus was granted 30,000 shares of
restricted stock on July 1, 1994, of which 20,000 shares were granted pursuant
to his employment agreement. The additional 10,000 shares were awarded in lieu
of an adjustment in Mr. Gildehaus' base salary level. In awarding this number of
shares, the Committee took into subjective consideration Mr. Gildehaus' overall
performance in the previous 12 month period, including his effective leadership
of the Company's operating divisions and the superior return to shareholders
since the inception of his employment. The restricted stock is vested, subject
to certain forfeiture provisions if Mr. Gildehaus' employment is terminated
within three years of the date of a stock grant. In the event that the Company
terminates Mr. Gildehaus' employment for cause, or if he voluntarily resigns
(other than for good reason, as defined in the employment agreement) within
three years of the date of a stock grant, the restricted stock is forfeited. In
the event of termination of Mr. Gildehaus' employment without cause, the
forfeiture provisions terminate with respect to a prorated portion of restricted
stock based upon the number of months elapsed from the date of the award. All
forfeiture provisions terminate upon death, disability or a change of control of
the Company. During the restricted period, Mr. Gildehaus is entitled to voting
rights and to receive dividends and other distributions on the restricted
shares. In 1994 Mr. Gildehaus also participated in the Stock Purchase Plan,
described above, under which plan he purchased 900,000 shares of common stock.
SECTION 162(M) OF THE INTERNAL REVENUE CODE
The Committee has considered the effect of Section 162(m) of the Internal
Revenue Code, which limits to $1 million the tax deduction for compensation paid
to the top five executive officers unless certain requirements are met. The
Committee does not expect that any executive officer's compensation is
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likely to exceed $1 million except as a possible consequence of dividends that
might be paid on stock held by the Chief Executive Officer under the Restricted
Stock Plan or imputed interest on loans to purchase Company stock under the 1994
Executive Stock Purchase Plan. Accordingly, the Committee concluded not to make
any changes in the Company's existing compensation programs at this time. The
Committee will continue to consider the impact of Section 162(m) and to assess
alternatives to minimize or eliminate any loss of tax deductions in future years
consistent with the objectives of the Company's executive compensation programs.
Compensation Committee
Darius W. Gaskins, Jr., Chair
Gene Locks
Robert B. Steinberg
William J. Williams
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COMPANY PERFORMANCE GRAPH
The following performance graph compares the Company's total stockholder return
on its Common Stock for a five year period (December 31, 1989 to December 31,
1994) with the cumulative total return of the Standard & Poor's 500 Stock Index
and a peer group of companies which comprise the Standard & Poor's Manufacturing
(Diversified Industries) Index. This graph assumes an investment of $100 on
December 31, 1989 and reinvestment of dividends.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
UNR S&P 500 S&P MFG (DIV INDS)
<S> <C> <C> <C>
1989 $100 $100 $100
1990 $80 $99 $99
1991 $108 $130 $122
1992 $231 $137 $132
1993 $302 $149 $160
1994 $296 $155 $166
</TABLE>
12
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EMPLOYMENT CONTRACTS AND CHANGE OF CONTROL AGREEMENTS
EMPLOYMENT AGREEMENT -- THOMAS A. GILDEHAUS
On July 1, 1992, Mr. Thomas A. Gildehaus was elected President and Chief
Executive Officer of UNR. UNR entered into an employment agreement (the
"Agreement") with Mr. Gildehaus having a term of three years. The Agreement
provides for a minimum annual base salary of $300,000 (raised to $375,000 as of
July 1, 1993), which salary will be reviewed annually, and may be increased, but
not decreased, by the Compensation Committee of the Board of Directors.
Additionally, Mr. Gildehaus receives an annual incentive bonus if certain
mutually agreed upon performance goals are attained. Pursuant to the contract
Mr. Gildehaus received restricted Common Stock awards under the Restricted Stock
Plan of 60,000 shares on July 1, 1992, 20,000 shares on July 1, 1993, and 20,000
shares on July 1, 1994. In the event Mr. Gildehaus is terminated by UNR other
than for cause, death or disability or in the event Mr. Gildehaus terminates his
employment for good reason, as defined in the Agreement, the Agreement provides
for severance pay in an amount equal to 150% of the then current annual base
salary if a termination occurs prior to a Change in Control (substantially as
defined on page 16) or in an amount equal to 300% of the then current annual
base salary if a termination occurs after a Change of Control. Under the
Agreement, Mr. Gildehaus will receive disability income equal to 60% of the then
current annual base salary during any period of disability and life insurance
having a basic death benefit of $450,000. Mr. Gildehaus is also entitled to
participate in all retirement, short-term and long-term disability, life
insurance, accident insurance and any other benefit plans maintained by the
Company for senior executives.
CHANGE OF CONTROL AGREEMENTS
On March 5, 1993, UNR also entered into Change of Control Agreements ("Control
Agreements") with named executive officers, Henry Grey and Victor E. Grimm.
These Agreements are for a term of three years, subject to renewal for
additional three year terms. Change of Control is as defined on page 16.
If, during the term of these Control Agreements, a Change of Control occurs, and
within a two year period from the date of such Change of Control, either (i) the
executive's employment with the Company is terminated by the Company other than
for cause or on account of the executive's death, permanent disability or
retirement, or (ii) the executive resigns for good reason, then the Company is
required to pay to the executive a severance payment in an amount equal to three
times the total of the executive's annual salary plus the target bonus for the
year in which termination occurs; provided that in no event may the total amount
of the severance payment exceed 2.99 times the five year average W-2 income of
the executive. The severance payment shall be payable in a single lump sum
payable within 30 days of the termination of employment or resignation.
In addition to the severance payment, the Company is required to provide health,
disability and life insurance in accordance with the plans maintained by the
Company for executives for a period of three years from the date of termination
of the executive's employment, provided that health, disability and life
insurance benefits cease if the executive becomes employed during such period
and receives similar benefits in connection with such employment.
During employment and for a period of one year after the termination of
employment for any reason, the executive may not enter into, be connected with,
or work for an individual, firm or corporation which is then in substantial
competition with the Company in the United States.
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TRANSACTIONS WITH MANAGEMENT
Victor E. Grimm, Vice President, Secretary and General Counsel of UNR, is a
partner in the law firm of Bell, Boyd & Lloyd which provided certain legal
services to UNR in 1994. In 1994 the aggregate amount of legal fees for these
services was $115,000. These fees were excluded from Mr. Grimm's profit
participation at the law firm.
Pursuant to the UNR Industries, Inc. 1994 Executive Stock Purchase Plan, Thomas
A. Gildehaus, President and Chief Executive Officer, Henry Grey, Senior Vice
President and Chief Financial Officer and Victor E. Grimm, Vice President,
Secretary and General Counsel of the Company purchased a total of 1,650,000
shares of Common Stock of the Company on September 9, 1994 at a price of $5.525
per share. The purchase price was the average of the average of the reported
high and low prices for the Company's Common Stock on the NASDAQ/NMS on each of
the five trading days preceding the purchase. Shares were paid for in cash in
the amount of the par value of the shares ($.01 per share) and the balance in
promissory notes due in three years. The notes are interest free (although for
tax purposes interest is imputed), except that in the event that a participant
resigns from the Company or is terminated for cause, the notes become due and
interest at the applicable federal rate under Section 1274 of the Internal
Revenue Code is applied retroactively from the date of the notes. If the shares
are sold prior to the expiration of three years other than in connection with a
Change in Control (as defined on page 16), interest is applied retroactively
from the date of the note at the applicable Federal rate. Dividends and
distributions on the shares, after reduction for Federal and state taxes, must
be paid to the Company to be applied to the principal of the notes. The notes
are limited recourse in that, if the security is insufficient to satisfy the
loan balance at maturity, the participant can tender the shares in partial
payment of the notes and is personally liable for that portion of the deficiency
that exceeds 25% of the loan balance (before applying the security). The
Company's recourse is limited to the shares if the participant dies, becomes
disabled or is terminated without cause, if there is a Change in Control of the
Company or if the Company exercises its option to apply the shares to the notes
upon the participant's resigning or being terminated for cause. The amounts of
the promissory notes executed by Messrs. Gildehaus, Grey and Grimm on the date
of the foregoing transactions were $4,963,500, $2,757,500 and $1,378,750,
respectively, which amounts remained outstanding as of April 5, 1995.
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PROPOSAL 2: TO APPROVE ADOPTION OF UNR INDUSTRIES, INC.
1994 NONEMPLOYEE DIRECTOR STOCK OWNERSHIP PLAN
Following is a summary of the Nonemployee Director Stock Ownership Plan ("Stock
Plan") which has been adopted by the Board of Directors subject to
Securityholder approval. This summary is subject to the specific provisions of
the Stock Plan, a copy of which is attached to this Statement as Exhibit A.
PURPOSE
The purpose of the Stock Plan is to further the growth, development and
financial success of the Company by strengthening the Company's ability to
attract and retain the services of knowledgeable nonemployee directors by
facilitating further purchases of stock.
ADMINISTRATION
The Stock Plan is administered by the Board of Directors of the Company whose
interpretation and administration of the plan are final.
ELIGIBILITY AND SHARES COVERED
Persons eligible to participate in the Stock Plan are only nonemployee directors
of the Company. Nothing in the Stock Plan shall be deemed to create an
obligation of the Board to renominate a director for election to the Board. The
total number of shares available for award under the Stock Plan may not exceed
200,000 subject to adjustment in the event of a merger, reorganization,
recapitalization, liquidation, stock dividend, split up, share combination, or
other change in capitalization of the Company, in which case the Committee shall
provide for equitable adjustment in the number of shares then subject to the
Stock Plan.
AWARDS OF RESTRICTED STOCK
Each nonemployee director has the right to elect in writing to receive all or
part of his or her annual retainer fee, which would otherwise be payable in
cash, in shares of restricted stock as of the Annual Meeting at which the
nonemployee director is elected or re-elected. The number of restricted shares
awarded is determined by dividing the amount of the retainer to be paid in
shares of stock by the average of the average of the highest and lowest sales
prices of the Company's common stock on the NASDAQ/NMS on each of the five
trading days immediately preceding the date of the award and rounding to the
nearest whole number. Elections must be made not less than six months prior to
the Annual Meeting date on which the election is to be effective except that the
election for 1995 must be made by April 30, 1995. A participant's election
remains in effect until changed by written notice at least six months in advance
of the effective date of the change.
RESTRICTIONS ON STOCK AWARDED
At the time that restricted stock is issued the participant becomes a
stockholder of the Company with respect to the restricted stock and shall be
entitled to vote the shares and to receive all dividends. If a dividend is paid
in stock, the stock shall be held by the Company subject to the same
restrictions as the restricted stock that is a basis of the dividend. All stock
certificates are to be held in custody by the Company for the account of the
participant together with stock powers executed by the participant in favor of
the Company. The shares issued under the Stock Plan may not be sold, pledged,
assigned, transferred, gifted, or otherwise alienated or hypothecated until the
restrictions lapse. The restrictions lapse upon the earlier of (a) five years
from the date of the award or (b) termination of the participant's service as a
director by reason of death, disability or retirement from the Board. The
Company may impose such other restrictions as it deems necessary or advisable,
including imprinting a legend on
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<PAGE>
the stock certificates and restrictions to achieve compliance with the
securities laws and stock exchange requirements. Upon lapse of the restrictions,
the certificates representing the shares are to be delivered to the participant
or to the participant's legal representative. In the event that the
participant's service as a director is terminated for fraud, intentional
misrepresentation, embezzlement, misappropriation or conversion of assets or
opportunities of the Company, all restricted stock is forfeited.
CHANGE IN CONTROL
Notwithstanding the other provisions of the Stock Plan, the restrictions on the
restricted stock lapse, and the restricted stock is vested in the participant,
upon a Change in Control of the Company. A Change in Control includes (i) the
acquisition by any person or group acting in concert of beneficial ownership of
50% or more of the Company's outstanding shares and Warrants, with certain
exceptions, (ii) a change in the composition of the Company's Board of Directors
in any 24-month or less period such that a majority of the directors serving at
the end of the period were not serving at the beginning of the period, unless at
the end of the period the majority of the directors in office were nominated
upon the recommendation of a majority of the Board at the beginning of the
period, or (iii) approval by Securityholders of a merger, consolidation or
similar transaction, or the sale of all or substantially all of the Company's
consolidated assets, as to which those Securityholders immediately prior to such
transaction are not the owners of more than 50% of the resulting corporation's
outstanding voting securities after such event.
FEDERAL TAX CONSEQUENCES
Under existing federal income tax law, no income will be recognized to the
participant at the time of the restricted stock award. Upon lapse of
restrictions, the participant will be required to treat as ordinary income the
fair market value of the stock and the Company will be entitled to a deduction
in such amount.
AMENDMENTS AND EFFECTIVE DATE
The Board of Directors may terminate, amend or modify the Stock Plan at any time
provided that the provisions concerning the price or timing of awards may not be
amended more than once every six months other than to comply with changes in
applicable law. The Stock Plan may not be amended to materially increase the
number of shares available for grant under the Stock Plan, modify the
eligibility requirements or increase the benefits without Securityholder
approval. The Stock Plan terminates upon the award of all of the shares subject
to it but in no event later than May 10, 2002. The Stock Plan shall become
effective upon its approval by a majority of the Securityholders. UNR has been
advised by the Trust that it intends to vote its Securities in favor of the
Stock Plan.
PROPOSAL 3: RATIFICATION OF APPOINTMENT
OF INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP has served as independent public accountants for UNR (and
its predecessors) for the past 32 years. The Board of Directors has retained
this firm as UNR's independent public accountants for its current fiscal year,
subject to ratification by Securityholders at the Annual Meeting. Although
submission of this proposal to a vote of Securityholders is not required by law,
management believes that such action is appropriate because the independent
public accountants ultimately are responsible to the Securityholders. The Board
of Directors unanimously recommends a vote FOR this Proposal. In the event,
however, that such approval is not given, the Board will consider the
appointment of other independent public accountants. Representatives of Arthur
Andersen LLP are
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<PAGE>
expected to be present at the Annual Meeting with the opportunity to make a
statement if they so desire and to be available to respond to appropriate
questions. UNR has been advised by the Trust that it intends to vote its
Securities for ratification of Arthur Andersen LLP as independent public
accountants for UNR.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who own more than 10% of a
registered class of the Company's Securities, to file reports of ownership and
changes in ownership with the Securities and Exchange Commission.
Based solely on its review of such reports received by it, the Company believes
that during 1994 all filing requirements applicable to its executive officers,
directors and greater than 10% Securityholders were complied with except that
Mr. Steinberg, a director of the Company, filed one report with respect to one
transaction three days late.
SECURITYHOLDER PROPOSALS; OTHER MATTERS
Securityholder proposals for inclusion in proxy materials for the 1996 Annual
Meeting of Stockholders should be addressed to UNR's Secretary, 332 South
Michigan Avenue, Chicago, Illinois 60604, and must be received on or before
December 6, 1995.
The Company's By-Laws specify procedures for notifying the Secretary of business
to be properly brought before any meeting of Securityholders. A copy of the
By-Laws may be obtained from UNR's Secretary.
At this time, the Board of Directors is not aware of any other matters to be
presented for action at the Annual Meeting other than those presented above in
this Proxy Statement. If any other business should properly come before the
Annual Meeting, votes may be cast with respect to such matters in accordance
with the best judgment of the person or persons acting under the proxy.
By Order of the Board of Directors
Victor E. Grimm
SECRETARY
Chicago, Illinois
April 5, 1995
ANY SECURITYHOLDER MAY OBTAIN A COPY OF UNR'S 1994 ANNUAL REPORT ON FORM 10-K TO
THE SECURITIES AND EXCHANGE COMMISSION, WITHOUT CHARGE BY WRITING TO UNR AT 332
SOUTH MICHIGAN AVENUE, CHICAGO, ILLINOIS 60604, ATTENTION: HENRY GREY, SENIOR
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER.
17
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EXHIBIT A
UNR INDUSTRIES, INC. 1994 NONEMPLOYEE DIRECTOR
STOCK OWNERSHIP PLAN
ARTICLE I -- PURPOSE OF THE PLAN
The purpose of the UNR Industries, Inc. 1994 Nonemployee Director Stock
Ownership Plan is to further the growth, development, and financial success of
the Corporation by strengthening the Corporation's ability to attract and retain
the services of experienced and knowledgeable Nonemployee Directors by enabling
them to participate in the Corporation's growth and by linking the personal
interests of Nonemployee Directors to those of the Corporation's shareholders.
ARTICLE II -- CERTAIN DEFINITIONS
Unless the context clearly indicates otherwise, the following terms shall have
the following meanings:
2.1 "Award" means a grant of Restricted Stock under the Plan.
2.2 "Board" means the Board of Directors of UNR Industries, Inc.
2.3 "Change of Control" shall have the meaning set forth in Section 7.2.
2.4 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
2.5 "Corporation" means UNR Industries, Inc.
2.6 "Disability" means total disability within the meaning of Section 22(e)(3)
of the Code.
2.7 "Employee" means any full time worker, paid hourly or by salary, in the
employment of the Corporation or any of its subsidiaries.
2.8 "Exchange Act" means the Securities Exchange Act of 1934, as amended.
2.9 "Nonemployee Director" means any individual who is a member of the Board of
the Corporation, but who is not otherwise an Employee of the Corporation.
2.10 "Participant" means a Nonemployee Director who has been awarded stock under
the Plan.
2.11 "Plan" means the UNR Industries, Inc. 1994 Nonemployee Director Stock
Ownership Plan.
2.12 "Restricted Stock" or "Restricted Shares" means shares of common stock of
the Corporation granted to a Nonemployee Director under the Plan.
2.13 "Retirement" means cessation of membership on the Board of the Corporation
for any reason other than death, disability or for cause.
2.14 "Stock" or "Shares" means common stock of the Corporation.
ARTICLE III -- ADMINISTRATION
3.1 ADMINISTRATION OF PLAN. The Plan shall be administered by the Board,
subject to the restrictions set forth in the Plan.
3.2 AUTHORITY OF THE BOARD. The Board shall have the full power, discretion,
and authority to interpret and administer the Plan in a manner which is
consistent with the Plan's provisions. Any action
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taken by the Board with respect to the administration of the Plan which would
result in any Nonemployee Director ceasing to be a "disinterested person" within
the meaning of Rule 16b-3 under the Exchange Act shall be null and void.
3.3 EFFECT OF BOARD DETERMINATIONS. All determinations and decisions made by
the Board pursuant to the provisions of the Plan and all related orders or
resolutions of the Board shall be final, conclusive, and binding on all persons,
including the Corporation, its shareholders, Employees, Participants and their
estates and beneficiaries.
ARTICLE IV -- ELIGIBILITY
4.1 Persons eligible to participate in the Plan shall be limited to the
Nonemployee Directors of the Corporation.
ARTICLE V -- SHARES SUBJECT TO THE PLAN
5.1 NUMBER OF SHARES. Subject to adjustment as provided herein, the total
number of Shares available for Award under the Plan may not exceed 200,000. If
any Shares Awarded under the Plan shall be forfeited, such Shares shall again
become available for future Awards under the Plan.
5.2 ADJUSTMENTS IN AUTHORIZED SHARES. In the event of any merger,
reorganization, consolidation, recapitalization, liquidation, stock dividend,
split up, Share combination, or other change in the corporate structure of the
Corporation affecting the Shares, the Board may make such adjustments to
outstanding Awards to prevent dilution or enlargement of rights.
ARTICLE VI -- RESTRICTED STOCK
6.1 AWARDS OF RESTRICTED STOCK. Each Nonemployee Director shall have the right
to elect, in writing filed with the Secretary of the Corporation, to receive all
or part of his or her annual retainer fee which would otherwise be payable in
cash, in Shares of Restricted Stock as of the Annual Meeting at which the
Nonemployee Director is elected or re-elected, commencing with the effective
date of the Plan. The number of Restricted Shares so awarded shall be determined
by dividing the amount of the retainer to be paid in Shares by the average of
the average of the highest and lowest sales prices of the Corporation's common
stock on the National Association of Securities Dealers, Inc.'s Automated
Quotation/National Market System ("NASDAQ/NMS") (or if the Corporation's common
stock is not then traded on the NASDAQ/NMS, on the principal market where such
common stock is actively traded) (as reported in The Wall Street Journal,
Midwest Edition) on each of the five trading days immediately preceding the date
of the award and rounding to the nearest whole number. Elections under this
section shall be made not less than six months prior to the Annual Meeting date
on which the election is to be effective, except that a Participant's election
for 1995 shall be made prior to April 30, 1995. A Participant's election shall
remain in effect from year to year until changed by the Participant. No change
in an election shall be effective prior to an Annual Meeting date at least six
months after the date of the change.
6.2 TRANSFERABILITY AND CUSTODY. The Restricted Shares awarded to a
Nonemployee Director may not be sold, pledged, assigned, transferred, gifted or
otherwise alienated or hypothecated until such time as the restrictions with
respect to such Shares have lapsed as provided herein. At the time Restricted
Shares are awarded to a Participant, stock certificates representing the
Restricted Stock shall be issued in the name of the Participant. Thereupon the
Participant shall become a stockholder of the Corporation with respect to such
Restricted Stock and shall be entitled to vote the shares and be
A-2
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entitled to receive all dividends. If all or part of a dividend is paid in
Stock, the Stock shall be held by the Corporation subject to the same
restrictions as the Restricted Stock that is the basis for the dividend. All
stock certificates representing Restricted Shares shall be held in custody by
the Corporation for the account of the Participant, together with stock powers
executed by the Participant in favor of the Corporation.
6.3 OTHER RESTRICTIONS. The Corporation may impose such other restrictions on
Shares granted pursuant to the Plan as it may deem necessary or advisable
including, without limitation, imprinting a legend on the certificates and
restrictions to achieve compliance with Securities laws and stock exchange
requirements.
6.4 LAPSE OF RESTRICTIONS. The restrictions provided in Sections 6.2 and 6.3
shall remain in effect until, and shall lapse only upon, the earlier of (a) five
years from the date of the Award or (b) the termination of a Participant's
service as a Director by reason of death, Disability, or Retirement from the
Board. Upon lapse of the restrictions, the certificates representing the Shares
shall thereafter be delivered to the Participant, or in the case of
Participant's death or Disability, to the Participant's personal representative
or to the person to whom such shares are transferred by will or by the
applicable laws of descent and distribution.
6.5 TERMINATION FOR CAUSE. In the event the Participant's service as a
Director is terminated on account of (a) fraud or intentional misrepresentation,
or (b) embezzlement, misappropriation, or conversion of assets or opportunities
of the Corporation, all Restricted Shares awarded to such Participant prior to
the date of termination shall be immediately forfeited.
6.6 WITHHOLDING OF TAXES. The Corporation shall have the right to collect cash
from Participants in an amount necessary to satisfy any Federal, state or local
withholding tax requirements. A Participant may elect to satisfy tax withholding
requirements, in whole or in part, by having the Corporation withhold Shares to
satisfy the amount of taxes required to be withheld.
ARTICLE VII -- CHANGE IN CONTROL
7.1 EFFECT OF CHANGE OF CONTROL. Notwithstanding the provisions of Article VI
herein, upon the occurrence of an event of Change of Control:
(a) the Restrictions imposed on the Restricted Stock shall lapse, and the
Restricted Stock shall vest in the Participant, and
(b) within ten (10) business days after the occurrence of a Change of Control,
the certificates representing the Restricted Stock so vested, without any
restriction or legend thereon, shall be delivered to the Participant.
7.2 The term "Change of Control" shall mean the occurrence of any of the
following events:
(a) The acquisition, by a person or group of persons acting in concert, of a
beneficial ownership interest in the Company, resulting in the total
beneficial ownership of such persons or group of persons equaling or
exceeding 50% of the outstanding common stock and warrants of the Company;
provided, however, that no such person or group of persons shall be deemed
to beneficially own (i) any common stock or warrants acquired directly from
the Company or (ii) any common stock or warrants held by the Company or any
of its subsidiaries or any employee benefit plan (or any related trust) of
the Company or its subsidiaries. The Change in Control shall
A-3
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be deemed to occur on the date the beneficial ownership of the acquiring
person or group of persons first equals or exceeds 50% of the outstanding
common stock and warrants of the Company.
(b) A change, within any period of twenty-four (24) months or less, in the
composition of the Board such that at the end of such period a majority of
the directors who are then serving were not serving at the beginning of such
period, unless at the end of such period the majority of the directors in
office were nominated upon the recommendation of a majority of the Board at
the beginning of such period. The Change in Control shall be deemed to occur
on the date the last director necessary to result in a Change in Control
takes office or resigns from office, as applicable.
(c) Approval by securityholders of the Company of a merger, consolidation or
other reorganization having substantially the same effect, or the sale of
all or substantially all the consolidated assets of the Company in each
case, with respect to which the persons or group of persons who were the
respective beneficial owners of the common stock or warrants immediately
prior to such event do not, following such event, beneficially own, directly
or indirectly, more than 50% of, respectively, the then outstanding voting
securities of the corporation resulting from such event or the corporation
purchasing or receiving assets pursuant to such event. The Change in Control
shall be deemed to occur on the date on which the transaction is approved by
the Company's securityholders.
ARTICLE VIII -- AMENDMENT, MODIFICATION AND TERMINATION
8.1 AMENDMENT, MODIFICATION AND TERMINATION. Subject to the terms set forth in
this Section 8.1, the Board may terminate, amend, or modify the Plan at any time
and from time to time; provided, however, that the provisions set forth in the
Plan regarding the amount, the price or the timing of Awards to Nonemployee
Directors may not be amended more than once every six (6) months, other than to
comport with changes in the Code, the Employee Retirement Income Security Act,
or the rules thereunder. The Plan shall terminate when all of the Shares subject
to it have been awarded according to the provisions of the Plan. However, in no
event shall an award be made under the Plan on or after May 10, 2002.
Without the approval of the voting securityholders of the Company as may be
required by the Code, by the rules of Section 16 of the Exchange Act, by any
national securities exchange or system on which the Shares are then listed or
reported, or by a regulatory body having jurisdiction with respect hereto, no
such termination, amendment or modification may:
(a) Materially increase the total number of Shares which may be available for
grants of Awards under the Plan, except as provided in Section 5.2 herein;
or
(b) Materially modify the requirements with respect to eligibility to
participate in the Plan; or
(c) Materially increase the benefits accruing to Nonemployee Directors under the
Plan.
8.2 AWARDS PREVIOUSLY GRANTED. Unless required by law, no termination,
amendment or modification of the Plan shall materially affect, in an adverse
manner, any Award previously granted under the Plan, without the consent of the
Nonemployee Director holding the Award.
A-4
<PAGE>
ARTICLE IX -- NO RIGHT OF NOMINATION
Nothing in the Plan shall be deemed to create any obligation on the part of the
Board to nominate any Participant for reelection by the Corporation's
securityholders.
ARTICLE X -- REQUIREMENTS OF LAW
The granting of Awards under the Plan and the issuance of stock certificates
shall be subject to all applicable laws, rules, and regulations, and to such
approvals by any governmental agencies or national securities exchanges as may
be required.
ARTICLE XI -- EFFECTIVE DATE
The Plan shall become effective upon approval by the holders of a majority of
the shares of common stock and warrants voting together as a single class at a
meeting of stockholders or by written consent.
A-5
<PAGE>
UNR INDUSTRIES, INC. PROXY/VOTING INSTRUCTION CARD
p 332 SOUTH MICHIGAN AVENUE
R CHICAGO, ILLINOIS 60604
O
X THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
Y
The undersigned hereby appoints Gene Locks and Thomas A. Gildehaus and
each of them, as the proxies and representatives of the undersigned,
with full power of substitution, to vote all of the shares of common
stock and warrants of UNR Industries, Inc. which the undersigned would
be entitled to vote, with all powers which the undersigned would have
if personally present, at the Annual Meeting of Securityholders to be
held on May 4, 1995 and at any adjournment or postponement thereof, as
designated on the reverse side.
Election of Directors:
Nominees: C. Brennan, D. Gaskins, T. Gildehaus, G. Locks, R. McMullin,
T. Meagher, R. Steinberg, W. Williams.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER(S) OR WARRANTHOLDER(S). IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 1, 2 AND 3.
PLEASE SIGN AND DATE ON THE REVERSE SIDE AND MAIL THIS
PROXY IN THE ENCLOSED RETURN ENVELOPE AS PROMPTLY AS POSSIBLE.
<PAGE>
/X/ PLEASE MARK YOUR 8680
VOTES AS IN THIS
EXAMPLE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1, 2 AND 3.
FOR all listed Nominees, WITHHELD as to ALL
except as listed below Nominees
1. Election of / / / / To withhold authority to vote
Directors. for any individual nominee(s),
write the name(s) of the
nominee(s) on the line below.
----------------------------------------------
FOR AGAINST ABSTAIN
2. Proposal to approve the UNR / / / / / /
Industries, Inc. 1994 Nonemployee
Director Stock Ownership Plan.
3. Proposal to ratify the appointment / / / / / /
of Arthur Andersen LLP as independent
public accountants of UNR Industries, Inc.
4. In their discretion, the proxies and
representatives are authorized to vote
upon such other business as may properly
come before this meeting.
NOTE: Please sign exactly as name(s) appear(s)
below. If shares of common stock or warrants
are held in the name of more than one person,
all must sign. When signing as attorney,
executor, administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full corporate
name by president or other authorized officer.
If a partnership, please sign in partnership
name by authorized person.
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Signature Date(s)
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Signature (if held jointly) Date(s)
