<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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 Rule 14a-11(c) or Rule 14a-12.
ANIXTER INTERNATIONAL INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
ANIXTER INTERNATIONAL INC.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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> 2
ANIXTER LOGO
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 25, 2000
To the Stockholders of Anixter International Inc.:
The Annual Meeting of Stockholders of Anixter International Inc. will be
held at Two North Riverside Plaza, 6th Floor, Chicago, Illinois on Thursday, May
25, 2000, at 11:00 a.m., for the purpose of:
(1) electing 12 Directors;
(2) approving the Company's Management Incentive Plan; and
(3) transacting such other business as may properly be brought before the
meeting or any adjournment(s) thereof.
The Board of Directors has fixed the close of business on April 5, 2000 as
the record date for the determination of stockholders entitled to notice of, and
to vote at, the meeting or any adjournment(s) thereof. A complete list of the
stockholders entitled to vote at the meeting will be open for examination by any
stockholder for any purpose germane to the meeting during ordinary business
hours for ten days prior to the meeting at the offices of Anixter International
Inc., 4711 Golf Road, Skokie, Illinois 60076, and will also be available at the
meeting.
A copy of Anixter International Inc.'s Annual Report to Stockholders for
the fiscal year ended December 31, 1999 is being mailed to all registered
holders. Additional copies of the Annual Report may be obtained without charge
by writing to the Treasurer of Anixter International Inc., 4711 Golf Road,
Skokie, Illinois 60076.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ James E. Knox
James E. Knox, Secretary
Chicago, Illinois
April 19, 2000
ALL STOCKHOLDERS ARE INVITED TO ATTEND THE MEETING IN PERSON. WHETHER OR NOT YOU
EXPECT TO ATTEND, PLEASE DATE, SIGN AND COMPLETE THE ENCLOSED PROXY AND MAIL IT
PROMPTLY IN THE POSTAGE PREPAID ENVELOPE PROVIDED.
<PAGE> 3
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
OF ANIXTER INTERNATIONAL INC.
TO BE HELD MAY 25, 2000
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Anixter International Inc., a Delaware
corporation (the "Company," which as used herein shall mean together with or
without its subsidiaries, as the context may require). The Company's corporate
headquarters are located at 4711 Golf Road, Skokie, Illinois 60076 (telephone
847-677-2600). The Proxy Statement and form of proxy were first mailed to
stockholders on or about April 19, 2000. Proxies solicited by the Board of
Directors of the Company are to be voted at the Annual Meeting of Stockholders
of the Company to be held on Thursday, May 25, 2000, at 11:00 a.m., at Two North
Riverside Plaza, 6th Floor, Chicago, Illinois, or any adjournment(s) thereof.
This solicitation is being made by mail, although directors, officers and
regular employees of the Company may solicit proxies from stockholders
personally or by telephone, telegram or letter. The costs of this solicitation
will be borne by the Company. The Company may request brokerage houses, nominees
or fiduciaries and other custodians to solicit their principals or customers for
their proxies, and may reimburse them for their reasonable expenses in so doing.
In addition, the Company has retained Morrow & Co. to assist in the solicitation
for a fee of $3,000 plus expenses.
VOTING
Shares of Common Stock, $1.00 par value, of the Company ("Common Stock")
represented by proxies in the accompanying form which are properly executed and
returned to the Company (and which are not effectively revoked) will be voted at
the meeting in accordance with the stockholders' instructions contained therein.
In the absence of contrary instructions, shares represented by such proxies will
be voted IN FAVOR OF the election as directors of the nominees listed herein, IN
FAVOR OF Proposal 1 to approve the Management Incentive Plan, and in the
discretion of the appointed proxies upon such other business as may properly be
brought before the meeting.
Each stockholder has the power to revoke his or her proxy at any time
before it is voted by (i) delivering to the Company prior to or at the meeting
written notice of revocation or a later dated proxy or (ii) attending the
meeting and voting his or her shares in person.
The Board of Directors has fixed the close of business on April 5, 2000 as
the record date for the determination of stockholders entitled to notice of, and
to vote at, the meeting or any adjournment(s) thereof.
As of April 5, 2000, 36,064,725 shares of Common Stock were outstanding.
Each holder is entitled to one vote per share.
A majority of the outstanding shares of Common Stock will constitute a
quorum for purposes of the meeting. If a quorum is present, in person or by
proxy, the election of directors will be determined by plurality of the votes of
the shares represented at the meeting and the approval of the Management
Incentive Plan will be determined by the affirmative vote of the majority of the
shares represented at the meeting. As a result, shares represented at the
meeting and entitled to vote for directors, but which abstain from voting or
withhold votes, will be counted toward a quorum, will not affect the election of
directors, but will in effect be counted against the approval of the Management
Incentive Plan, unless such abstention is by virtue of a "broker non-vote."
<PAGE> 4
ELECTION OF DIRECTORS
In the absence of contrary instructions, the proxies received will be voted
for the election as directors of the nominees listed below to hold office until
the next annual meeting of stockholders or until their successors are elected
and qualified. Although the Board of Directors does not contemplate that any
nominee will decline or be unable to serve as a director, in either such event
the proxies will be voted for another person selected by the Board of Directors,
unless the Board acts to reduce the size of the Board of Directors in accordance
with the provisions of the Company's by-laws. The current number of directors
has been set by the Board at twelve.
The following table sets forth the name and age as of March 20, 2000 of
each director or nominee for director of the Company, the year each director was
first elected, his or her position with the Company, his or her principal
occupation(s) during the last five years and any other directorships held by
such person in companies which have a class of securities registered pursuant to
Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or subject to the requirements of Section 15(d) of the Exchange Act or
directorships of issuers registered as investment companies under the Investment
Company Act of 1940. The term of office of each director will extend until the
holding of the next annual meeting of stockholders or until his or her successor
is elected and qualified.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME AND AGE DURING PAST FIVE YEARS
------------ -----------------------------------
<S> <C>
Lord James Blyth, 59........... Director of the Company since 1995; Chairman since 1998,
Deputy Chairman from 1994 to 1998 and Chief Executive
Officer from 1987 to 1998 of The Boots Company, a
diversified company engaged in manufacturing, retailing
and real estate; Director of NatWest Group PLC and Diageo
plc.
Robert L. Crandall, 64......... Director of the Company since 1999; Chairman of the Board of
Directors and Chief Executive Officer from 1985 to 1998 of
AMR Corporation, an air transportation and diversified
services company; Director of American Express Company,
Celestica Inc., Halliburton Company, MediaOne Group, Inc.
and the National Park Foundation.
Rod F. Dammeyer, 59............ Director since 1985, Vice Chairman since 1998 and President
and Chief Executive Officer from before 1994 to 1998 of the
Company; Managing Partner since 1998 and Managing Director
from 1996 to 1998 of EGI Corporate Investments, a
diversified management and investment business; Director
of ANTEC Corporation, Allied Riser Communications
Corporation, CNA Surety Corp., GATX Corporation, IMC
Global Inc., Matria Healthcare, Inc., Stericycle, Inc.,
and TeleTech Holdings Inc.; and Trustee of Van Kampen,
Inc. closed-end funds.
Robert E. Fowler, Jr., 64...... Director of the Company since 1995; Chief Executive Officer
from 1997 to 1999 and President and Director from 1996 to
1999 of IMC Global Inc., a producer of crop nutrients and
animal feed ingredients; President from 1993 to 1996 and
Chief Executive Officer from 1995 to 1996 of The Vigoro
Corporation, a manufacturer and distributor of potash,
nitrogen-based fertilizer and related products; Director
of Arvin Industries, Inc.
Robert W. Grubbs Jr., 43....... Director since 1997, and President and Chief Executive
Officer since 1998 of the Company; President and Chief
Executive Officer of Anixter Inc., a subsidiary of the
Company, since 1994.
F. Philip Handy, 55............ Director of the Company since 1986; a private investor;
Managing Director of EGI Corporate Investments, a
diversified management and investment business, from 1997
to 1999; Partner of Winter Park Capital Company, a private
investment firm, from 1980 to 1997; Director of Chart
House Enterprises Inc., Banca Quadrum, S.A., Davel
Communications, Inc., Transmedia Network, Inc. and Wink
Communications, Inc.
</TABLE>
2
<PAGE> 5
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME AND AGE DURING PAST FIVE YEARS
------------ -----------------------------------
<S> <C>
Melvyn N. Klein, 58............ Director of the Company since 1985; Managing General Partner
of the investment partnership GKH Partners, L.P., since
1987; Attorney and counselor-at-law since 1968; a founder
of Questor Partners Fund, L.P. in 1995 and a principal of
that partnership through 1999; a member of the Advisory
Committee on International Economic Policy to the U.S.
Secretary of State; Director of Santa Fe Snyder Energy
Resources, Inc., Bayou Steel Corporation, Hanover
Compressor Company, Cockrell Oil and Gas, L.P., and ACTV,
Inc.
John R. Petty, 69.............. Director of the Company since 1988; Chairman of TECSEC
Incorporated, a data security company, since 1997; Chairman
of Federal National Payables, Inc., a factoring company,
since 1992; Private investor since 1988; Director of ANTEC
Corporation.
Sheli Z. Rosenberg, 58......... Director of the Company since 1990; Vice Chair from 2000 and
President and Chief Executive Officer from 1999 to 2000 of
Equity Group Investments, L.L.C., a private investment
firm; Principal of the law firm Rosenberg & Liebentritt,
P.C. from 1980 to 1997; President and a director of Equity
Group Investments, Inc., a real estate and corporate
investment firm, for more than the past five years;
Director of Capital Trust, Inc., Manufactured Home
Communities, Inc., CVS Corporation, Dynergy Inc. and Danka
Business Systems PLC; and Trustee of Equity Residential
Properties Trust and Equity Office Properties Trust.
Stuart M. Sloan, 56............ Director of the Company since 1994; a Principal since 1984
of Sloan Capital Companies, a private investment company;
Chairman of the Board of Directors from 1986 to 1998 and
Chief Executive Officer from 1991 to 1996 of Quality Food
Centers, Inc., a supermarket chain.
Thomas C. Theobald, 62......... Director of the Company since 1995; Managing Director of
William Blair Capital Partners, L.L.C. since 1994; Chairman
and Chief Executive Officer from 1987 to 1994 of
Continental Bank Corporation; Director of Jones, Lang
LaSalle Incorporated, MONY Group, Stein Roe Funds and
Xerox Corporation.
Samuel Zell, 58................ Director since 1984, and Chairman of the Board of Directors
since 1985 of the Company; Chairman of Equity Group
Investments, L.L.C. since 1999; Chairman of the Board of
Directors from before 1994 through 1999 of Equity Group
Investments, Inc., a real estate and corporate investment
firm; Chairman of the Board of Directors since 1995 and
Chief Executive Officer from 1995 to 1996 of Manufactured
Home Communities, Inc.; Chairman of the Board of Directors
of American Classic Voyages Co., Capital Trust, Inc.,
Chart House Enterprises, Inc., Danielson Holding
Corporation and Davel Communications, Inc.; Director of
Ramco Energy plc and Chairman of the Board of Trustees of
Equity Residential Properties Trust and Equity Office
Properties Trust.
</TABLE>
BOARD AND COMMITTEE MEETINGS
The Audit Committee, currently consisting of Messrs. Petty (Chair), Klein
and Theobald, provides general review of the Company's accounting and auditing
procedures, meets with the Company's independent auditors to review their
recommendations and reviews related party transactions. The Audit Committee held
seven meetings in 1999.
3
<PAGE> 6
The Compensation Committee, currently consisting of Messrs. Sloan (Chair)
and Crandall, Lord Blyth and Mrs. Rosenberg, exercises all powers of the Board
of Directors in connection with compensation matters, including incentive
compensation, benefit plans and stock grants. The Compensation Committee held
four meetings in 1999.
The Executive Committee, currently consisting of Messrs. Klein, Petty and
Zell (Chair) exercises the full powers of the Board of Directors to the extent
permitted by law in the intervals between Board meetings. The Executive
Committee held one meeting in 1999.
The Board of Directors held six meetings in 1999. Each of the directors
attended 75 percent or more of the total of all meetings held by the Board and
the committees on which the director served, except Lord Blyth.
The Company does not have a committee to nominate candidates for election
to the Board of Directors.
4
<PAGE> 7
EXECUTIVE COMPENSATION
The following tables set forth information about the compensation of the
chief executive officer and the four other most highly compensated executive
officers of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION AWARDS
-------------------
ANNUAL COMPENSATION SECURITIES
------------------------------ RESTRICTED UNDERLYING ALL OTHER
NAME & SALARY BONUS STOCK AWARD OPTIONS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($) (#) ($)
------------------ ---- ------ ----- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Robert W. Grubbs.............. 1999 500,000 273,450 1,214,110(3) 150,000 2,400(1)
President & Chief Executive 1998 480,000 293,970 -- 150,000 2,400
Officer 1997 420,000 375,000 -- 90,000 2,375
Rod Dammeyer.................. 1999 325,000 -- -- 150,000 2,400(1)
Vice Chairman 1998 325,000 -- -- 150,000 2,400
1997 325,000 512,256 -- 50,000 2,375
Dennis J. Letham.............. 1999 295,000 162,000 720,034(3) 50,000 2,400(1)
Senior Vice
President--Finance 1998 280,000 175,800 -- 50,000 2,400
and Chief Financial Officer 1997 260,000 233,450 -- 45,000 2,375
Lisa Kearns Lanz.............. 1999 180,000 119,100 -- 5,000 519(1)
Vice President--Controller 1998 170,000 66,220 -- 5,000 --
1997(2) 58,846 28,236 -- 6,500 --
John A. Dul................... 1999 160,000 158,000(4) -- 5,000 2,400(1)
General Counsel and 1998 143,750 58,300 -- 5,500 2,400
Assistant Secretary 1997 115,000 63,050 -- 5,000 2,375
</TABLE>
- ---------------
(1) Contributions to employee savings plan.
(2) 1997 compensation since date of hire, August 25, 1997.
(3) Value of restricted shares on date of grant. The restricted shares vest
annually in thirds beginning on the second anniversary of the grant or
earlier in the case of certain events. The 59,406 and 35,231 restricted
shares earned by Messrs. Grubbs and Letham, respectively, for the
achievement of the 1999 goal under the enhanced portion of the management
incentive plan are subject to the approval of the stockholders. See
"Proposal 1--Approval of Management Incentive Plan."
(4) Includes special project bonus.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------
NUMBER OF % OF TOTAL POTENTIAL REALIZABLE VALUE AT
SECURITIES OPTIONS ASSUMED ANNUAL RATES OF
UNDERLYING GRANTED TO STOCK PRICE APPRECIATION FOR
OPTIONS EMPLOYEES IN EXERCISE OR DATE OPTION TERM(1)
GRANTED FISCAL BASE PRICE OF ------------------------------
NAME (#) YEAR ($/SH) EXPIRATION 5%($) 10%($)
---- ---------- ------------ ----------- ---------- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Robert W. Grubbs(3)............ 150,000 13.4% 12.6875 3-01-09 1,196,864 3,033,090
Rod Dammeyer(2)(3)............. 150,000 13.4% 12.6875 3-01-09 915,463 2,214,710
Dennis J. Letham(3)............ 50,000 4.5% 12.6875 3-01-09 398,955 1,011,030
Lisa Kearns Lanz(3)............ 5,000 .4% 12.6875 3-01-09 39,895 101,103
John A. Dul(3)................. 5,000 .4% 12.6875 3-01-09 39,895 101,103
</TABLE>
- ---------------
(1) These numbers are for presentation purposes only and are not predictions of
future stock prices.
(2) Of these options, 100,000 have special vesting terms (see Compensation
Committee Report) and expire on 3-01-06.
(3) 25% of options become exercisable on each anniversary of grant.
5
<PAGE> 8
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR,
AND FISCAL YEAR-END OPTION VALUE
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
AT FY-END(#) AT FY-END($)
SHARES VALUE -------------------- --------------------
ACQUIRED ON REALIZED EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) ($) UNEXERCISABLE UNEXERCISABLE
---- ----------- -------- ------------- -------------
<S> <C> <C> <C> <C>
Robert W. Grubbs(1)................. 80,000 757,000 150,000/330,000 417,656/1,802,344
Rod Dammeyer........................ 0 0 492,083/306,250 3,353,715/1,696,094
Dennis J. Letham(1)................. 23,500 191,500 127,750/126,250 790,206/647,969
Lisa Kearns Lanz.................... 0 0 4,500/12,000 12,516/60,172
John A. Dul(1)...................... 1,500 10,500 13,825/12,875 98,445/66,898
</TABLE>
- ---------------
(1) Includes options for shares of Anixter Inc.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
ANNUAL
REMUNERATION
ON WHICH YEARS OF SERVICE
BENEFITS ARE -------------------------------------------------------------------------
BASED 5 10 15 20 25 30 35
- ------------ - -- -- -- -- -- --
<S> <C> <C> <C> <C> <C> <C> <C>
$200,000 $12,000 $ 24,000 $ 36,000 $ 48,000 $ 60,000 $ 72,000 $ 72,000
300,000 18,000 37,000 56,000 74,000 93,000 111,000 111,000
400,000 25,000 50,000 75,000 100,000 125,000 150,000 150,000
500,000 31,000 63,000 95,000 126,000 158,000 189,000 189,000
600,000 38,000 76,000 114,000 152,000 190,000 228,000 228,000
700,000 45,000 89,000 134,000 178,000 223,000 267,000 267,000
800,000 51,000 102,000 153,000 204,000 255,000 306,000 306,000
900,000 58,000 115,000 173,000 230,000 288,000 345,000 345,000
1,000,000 64,000 128,000 192,000 256,000 320,000 384,000 384,000
</TABLE>
Above amounts are annual straight life annuity amounts (which are not
reduced for social security benefits) payable upon retirement at age 65 under
Anixter Inc. funded and unfunded defined benefit plans for Messrs. Grubbs,
Letham and Dul and Ms. Lanz, who have 22, 7 and 10 and 3 years of service,
respectively. The determination of remuneration is based upon payment, not
accrual, and therefore the covered compensation for 1999 will be the salary
shown in the summary compensation table for 1999 and the bonus shown in that
table for 1998. Under the enhanced portion of the management incentive plan in
effect in 1999 and 2000, the regular bonus opportunities for Messrs. Grubbs and
Letham were halved; therefore, their cash bonuses for these years will be
doubled in computing their covered compensation for pension purposes.
In the case of Mr. Dammeyer it had been agreed that he would receive an
annual straight life annuity amount (which is not reduced for Social Security
benefits) upon retirement at age 65 of $550,000 under the Company's funded and
unfunded defined benefit pension plans. In 2000 Mr. Dammeyer's unfunded pension
benefits were cashed out. As a result, he will be entitled only to the annuity
amounts provided by the Company's funded plan as set forth in the above table.
The annual remuneration upon which this benefit is based is limited by federal
tax rules to a maximum amount, which in 1999 was $160,000. Mr. Dammeyer has 14
years of service.
COMPENSATION OF DIRECTORS
The Company pays its non-employee directors annual retainers of $60,000 of
its stock in the form of stock units which convert to Common Stock at the
pre-arranged time selected by each director and fees of $1,750
6
<PAGE> 9
for each board meeting attended, $1,000 for each committee meeting attended and
a $5,000 annual retainer for committee chairpersons. Directors are reimbursed
for any expenses they incur in attending meetings. The Company at its discretion
may purchase, for its market value, Common Stock obtained pursuant to these
stock units or warrants granted in prior years.
EMPLOYMENT CONTRACTS AND TERMINATION OF
EMPLOYMENT AND CHANGE-IN-CONTROL ARRANGEMENTS
Messrs. Grubbs and Letham are employed pursuant to contracts terminable on
six months notice by either party, or earlier if there is good cause for
termination as defined in the contracts. Good cause for termination by the
executive includes forced relocation, significant reduction of salary, regular
bonus opportunity, and other benefits, no longer holding his current position as
defined in the contracts or any other significant reduction of responsibilities.
Good cause for termination by the Company includes material fiduciary breaches
and dishonest acts. If employment is terminated by the executive for good cause
or by the Company without good cause within four years after a change of control
as defined in the contracts, the executive is entitled to certain benefits.
These benefits include (i) payment of a pro rata portion of his regular bonus
for that year and his salary and regular bonus for the next two years, (ii) all
his options to purchase stock will vest and be exercisable for the lesser of two
years or their remaining life, (iii) his medical and life insurance coverage
will continue during this two year period, (iv) if the change of control occurs
in 2000, he will be cashed out of his enhanced incentive opportunity for that
year, see "Compensation Committee Report on Executive Compensation," based on
the average price of the Common Stock for the trading days in 2000 prior to the
change of control, and (v) he will be held harmless from any golden parachute
federal excise tax on these benefits. The executive is required to delay his
termination for a specified period if the good cause is based on a change of
position or reduction in responsibilities, but his stock options will vest at
the time of the change of control if he is not continuing in his current
position. If in connection with a change of control, at least 25% of the Common
Stock is being exchanged for any consideration other than publicly traded common
stock, the contracts provide that the executive's stock options will be
exercisable to the extent necessary to enable the executive to participate in
such exchange on a pro rata basis. Change of control is defined by the contracts
as any third person (other than Sam Zell and his affiliates) acquiring at least
25% of the Common Stock or substantially all the assets of the Company or the
majority of the directors of the Company being comprised of individuals who were
not nominated by the Board of Directors of the Company. Such a change of control
will also vest the restricted shares granted to Messrs. Grubbs and Letham and
the other participants in the enhanced portion of the Company's management
incentive plan. See "Compensation Committee Report on Executive Compensation."
Mr. Dammeyer is employed pursuant to a contract that provides for the
continuation of his employment through 2000. The contract provides for the
continuation of his salary and bonus opportunity (for which the parties have
substituted additional stock options) and such long-term incentives as the
Company shall determine to grant. Upon the termination of Mr. Dammeyer's
employment after 2000 or the earlier termination by the Company, all his options
to purchase stock will vest and be exercisable for the lesser of two years or
their remaining life. Mr. Dammeyer is permitted to engage in other business
activities that do not interfere with the performance of his duties for the
Company.
COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION
Lord James Blyth, Sheli Rosenberg, and Stuart Sloan for all of 1999, Robert
Fowler for the first half of 1999 and Robert Crandall for the latter portion of
1999 were members of the Compensation Committee of the Board of Directors.
In some portion or all of 1999, the following relationships existed: Rod
Dammeyer, Vice Chairman of the Company, was a member of the Compensation
Committee of the Board of Directors of IMC Global, Inc. and Mr. Fowler was an
executive officer and director of that company; Mr. Dammeyer was a member of the
Compensation Committee of Jacor Communications, Inc. and Samuel Zell, Chairman
of the Company, was
7
<PAGE> 10
an executive officer and director of that company; and Messrs. Zell and Dammeyer
and Mrs. Rosenberg served as members of the board of directors of numerous
non-public companies owned in whole or in part by Mr. Zell or his affiliates
which did not have compensation committees, and in many cases the executive
officers of those companies included Mrs. Rosenberg, Mr. Dammeyer and/or Mr.
Zell.
The Company in the normal course of business sold $3,035,256 of products in
1999 to Allied Riser Communications Corporation. Messrs. Zell and Dammeyer and
Mrs. Rosenberg are executive officers of the limited liability company that owns
approximately 11.5% of Allied Riser and an entity beneficially owned by Mr. Zell
owns a majority interest in this limited liability company.
In 1999, the Company entered into a financial advisory agreement with
Equity Group Investments, L.L.C. ("EGI"). This agreement provides for EGI to
provide financial advisory services as requested by the Company in connection
with tender offers, acquisitions, sales, mergers and similar transactions. For
such services, EGI will be paid a fee of 49 basis points of the enterprise value
of the transaction (amount paid plus assumed debt). EGI is beneficially owned by
trusts for the benefit of Mr. Zell and his family, and Mr. Dammeyer and Mrs.
Rosenberg are executive officers of EGI. The terms of this agreement were
determined by the Audit Committee.
Notwithstanding anything to the contrary set forth in any of the Company's
filings under the Securities Act of 1933, or the Exchange Act that might
incorporate future filings, including this Proxy Statement, in whole or in part,
the report presented below and the Performance Graph following shall not be
incorporated by reference into any such filings.
8
<PAGE> 11
COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The compensation policy of the Company for its executive officers
(including those named in the Summary Compensation Table) has been to pay base
salaries and annual bonuses within the median of the range paid by others for
comparable positions and to provide long-term incentive opportunities within the
high end of the range provided by others for comparable positions. From time to
time, the Committee reviews studies comparing the compensation of the Company's
executives with the compensation of similar executives of selected groups of
companies. The companies in the comparison groups were selected because they
were believed to be representative of the types of companies with which the
company competes for executives. The companies in the comparison group were of
all sizes and in several industries and have no correlation to the companies
included in the peer group used in the "Performance Graph." Because of the great
differences in size and industry between the Company and the companies in the
comparison group, the determination of the Committee that the current
compensation of the Company's executives is consistent with the Company's
compensation policy is subjective.
The salary of Mr. Grubbs was increased 4% in 1999 primarily to offset
inflation.
At the beginning of 1999, the Company announced aggressive goals to be
achieved by year-end 2000. To provide an incentive to meet these goals, an
enhanced incentive plan for 1999 and 2000 was adopted for Messrs. Grubbs and
Letham and several other key employees. In the case of Messrs. Grubbs and
Letham, the payment of any rewards under this enhanced incentive plan is subject
to the approval of the stockholders. See "Proposal 1--Approval of Management
Incentive Plan." A target of approximately 144% of salary was established for
Messrs. Grubbs and Letham. A goal for operating earnings before non-recurring
items was established for each of 1999 and 2000. Achievement of these goals
earns 100% of target. Achievement between approximately 90% and 110% of these
goals earns between 50% and 150% of target. In 1999, the maximum of 150% of
target was earned. The amount earned for the year is paid in restricted shares
of Common Stock based on the average closing price of the stock for that year.
The restricted shares vest in thirds beginning on the second anniversary of the
grant or earlier in the case of death, disability, a change of control or any
termination of employment, other than a voluntary termination of employment by
the holder. Unvested shares are forfeited if the holder voluntarily terminates
his employment. Subject to the approval of the stockholders, Messrs. Grubbs and
Letham will be issued 59,406 and 35,231 restricted shares, respectively, for
their achievement of the 1999 goal under the enhanced portion of their
management incentive plan.
Messrs. Grubbs and Letham continued to participate in the regular portion
of the management incentive plan, but their targets for this portion of the plan
were set at 50% of their normal targets. Mr. Grubbs' regular incentive target
opportunity for 1999 was established at 40% of his salary, with one third of
this opportunity determined by the operating earnings of Anixter Inc., the
Company's operating subsidiary, one third of this opportunity determined by
Anixter Inc.'s return on tangible capital, and one third of this opportunity
determined by the achievement of specified qualitative goals, with no weighting
among these goals. Mr. Grubbs was awarded a regular incentive bonus for 1999 of
$273,450. This represented 137% of his regular incentive target because each of
the Company's financial goals and his qualitative goals in the aggregate were
exceeded.
The incentive opportunities for the other executive officers who
participated in the 1999 regular incentive plan were set by the Committee at the
beginning of the year at amounts ranging from approximately 40% of salary for
Mr. Letham to 50% of salary for the highest paid of the other executive officers
participating in the plan. A portion of this opportunity ranging from two thirds
for Mr. Letham to 75-70% for the others, was based on the financial results of
Anixter Inc. and the remainder was based on the achievement of specified
qualitative goals. The components of the financial results were operating
earnings and return on tangible capital, with the weighting dependent upon
responsibilities. Incentive awards for 1999 for these executive officers were
from 135% to 126% of target incentive opportunities because each of the
financial targets were exceeded and the qualitative goals in the aggregate of
each participant were substantially met or exceeded.
The grants to executives of options to purchase stock were based on
guidelines adopted in 1998. The number of shares provided by the guidelines for
each executive was determined at that time by taking a
9
<PAGE> 12
percentage of the executive's then salary and dividing that amount by the then
value per option. The percentages were set in the same manner as other
components of compensation. These percentages were not affected by previous
grants.
In lieu of participation in the 1999 incentive plan, Mr. Dammeyer was
granted an additional option for 100,000 shares which does not become
exercisable until the earlier of the price of the stock closing above $19 for
more than 10 consecutive days, six years from the grant, or the termination of
Mr. Dammeyer's employment in accordance with his employment agreement.
The components of executive officer compensation related to the performance
of the Company are the levels of the annual incentive awards as described above
and the ultimate value of long-term incentive awards as determined by the stock
market.
It is the policy of the Company to structure its compensation in a manner
which will avoid the limitations imposed by the Omnibus Budget Reconciliation
Act of 1993 on the deductibility of executive compensation under Section 162(m)
of the Internal Revenue Code to the extent it can reasonably do so consistent
with its goal of retaining and motivating its executives in a cost effective
manner.
Stuart Sloan
Lord James Blyth
Robert L. Crandall
Sheli Z. Rosenberg
10
<PAGE> 13
PERFORMANCE GRAPH
Below is a graph comparing total shareholder return on the Company's Common
Stock over the last five years with a broad equity market index and a peer group
index as required by the rules of the Securities and Exchange Commission.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
Description 1994 1995 1996 1997 1998 1999
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Anixter Intl Inc ($) $100.00 $107.58 $ 93.14 $ 95.31 $117.33 $119.14
S & P 500 ($) $100.00 $137.58 $169.17 $225.60 $290.08 $351.12
Peer Group Only ($) $100.00 $120.10 $140.61 $162.53 $143.80 $129.59
Russell 2000 ($) $100.00 $128.40 $149.66 $183.13 $178.46 $216.40
</TABLE>
As a result of the Company's repurchase of a significant amount of its
common stock and corresponding reduction of its market capitalization, the
Company has determined that the S&P 500 no longer provides a meaningful
comparison. Accordingly, the Company has selected the Russell 2000 Index, which
includes small and mid-cap companies, as a more comparable broad equity market
index.
The Company's Peer Group Index consists of the following companies: Anicom
Inc., Arrow Electronics Inc., Avnet Inc., W.W. Grainger Inc., Ingram Micro, Kent
Electronics Corp., Pioneer-Standard Electronics, Inc., Premier Farnell, and Tech
Data. This peer group was selected based on a review of publicly available
information about these companies and the Company's determination that they are
engaged in distribution businesses similar to that of the Company.
11
<PAGE> 14
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth, as of April 5, 2000, certain information
with respect to the Common Stock that may be deemed to be beneficially owned
(including options or warrants exercisable within 60 days) by each director or
nominee for director of the Company, the officers named in the Summary
Compensation Table and by all directors and officers as a group.
<TABLE>
<CAPTION>
OPTIONS
AND
WARRANTS
COMMON FOR COMMON PERCENT
STOCK STOCK TOTAL OF CLASS
----------- ---------- --------- ---------
<S> <C> <C> <C> <C>
Name of Beneficial Owner(1)
Lord James Blyth............................ 13,991(7) 10,000 23,991 *
Robert L. Crandall.......................... 6,111(9) 0 6,111 *
Rod F. Dammeyer............................. 323,397(3) 598,333 921,730 2.5%(6)
Robert E. Fowler, Jr........................ 13,991(7) 10,000 23,991 *
F. Philip Handy............................. 104,991(10) 50,000 154,991 *
Melvyn N. Klein............................. 36,991(4)(7) 60,000 96,991 *
John R. Petty............................... 10,082(8) 50,000 60,082 *
Sheli Z. Rosenberg.......................... 59,277(10) 30,000 89,277 *
Stuart Sloan................................ 168,991(7) 10,000 178,991 *
Thomas C. Theobald.......................... 36,991(7) 10,000 46,991 *
Samuel Zell................................. 5,573,884(5) 75,000 5,648,884 15.6%(6)
Robert W. Grubbs(2)......................... 23,725 270,000 293,725 *
Dennis J. Letham(2)......................... 4,401 136,250 140,651 *
Lisa Kearns Lanz............................ -- 7,000 7,000 *
John A. Dul(2).............................. 4,387 12,750 17,137 *
All directors and executive officers as a
group including the above-named
persons(2).................................. 6,669,374 1,647,146 8,316,520 22.1%(6)
</TABLE>
- ---------------
* Percentage of shares beneficially owned does not exceed one percent of the
class.
(1) Unless otherwise indicated, each person included in the group has sole
investment power and sole voting power with respect to the securities
beneficially owned by such person.
(2) Mr. Grubbs, Mr. Letham, Mr. Dul and all directors and executive officers as
a group have shares or options exercisable within 60 days of the date of
this table to purchase shares of Anixter Inc., totalling 80,000, 67,500,
7,700 and 155,467, respectively, which represent in each case less than 1%
of the stock of Anixter Inc.
(3) Includes 14,200 shares held by Mr. Dammeyer's spouse and of which Mr.
Dammeyer disclaims beneficial ownership.
(4) Includes 4,000 shares held in trust for Mr. Klein's minor children and of
which Mr. Klein disclaims beneficial ownership.
(5) The shares of Common Stock shown in this table include shares that are
owned (a) by a limited liability company whose sole member is a trust
company, as trustee of a trust of which Mr. Zell and members of his family
are beneficiaries, (b) by a limited liability company whose sole member is
a limited liability company whose sole managing member is a corporation
wholly owned by a trust company, as trustee of a trust of which Mr. Zell
and members of his family are beneficiaries, and (c) by a partnership of
which the Samuel Zell Revocable Trust is one of two general partners. (See
"Security Ownership of Principal Stockholders" below.) Mr. Zell disclaims
beneficial ownership of the shares of Common Stock held by the partnership.
(6) All warrants and options exercisable within 60 days of the date of this
table which may be deemed to be beneficially owned by the person or persons
for whom the calculation is being made are deemed to have been exercised
for the purpose of calculating this percentage.
(7) Includes 13,991 common stock units which convert to Common Stock on a 1 for
1 basis at the time determined when the stock units were granted.
(8) Includes 3,299 common stock units which convert to Common Stock on a 1 for
1 basis at the time determined when the stock units were granted.
(9) Includes 4,111 common stock units which convert to Common Stock on a 1 for
1 basis at the time determined when the stock units were granted.
(10) Includes 825 common stock units which convert to Common Stock on a 1 for 1
basis at the time determined when the stock units were granted.
12
<PAGE> 15
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS
The following table sets forth information as of April 5, 2000 with respect
to each person who is known by the management of the Company to be the
beneficial owner of more than 5% of the outstanding shares of Common Stock.
Unless otherwise indicated, the beneficial owner has sole voting and investment
power.
<TABLE>
<CAPTION>
TITLE NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT
OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
- -------- ------------------- -------------------- --------
<S> <C> <C> <C>
Common SZRL Investments 570,000(1) 22.2%(4)
Samstock, L.L.C 81,637(1)
Samstock/SIT, L.L.C 4,840,913(1)
Robert H. and
Ann Lurie Trust 2,327,379(1)
Anda Partnership 26,668(1)
LFT Partnership 26,668(1)
Samuel Zell 156,334(1)
Two North Riverside Plaza
Chicago, Illinois 60606
Common TIG Partners, L.P 5,554,000(2) 15.4%
200 West Madison Street
Suite 3800
Chicago, Illinois 60606
Common Lazard Freres & Co. LLC 2,511,970(3) 7.0%
30 Rockefeller Plaza
New York, New York 10020
</TABLE>
- ---------------
(1) SZRL Investments is a partnership, the general partners of which are the
Samuel Zell Revocable Trust and the Robert H. and Ann Lurie Trust.
Samstock/SIT, L.L.C. is a limited liability company whose sole member is
Chai Trust Company, L.L.C., a limited liability company, as trustee of the
Sam Investment Trust. The beneficiaries of the Sam Investment Trust are
Samuel Zell and members of his family. Samstock, L.L.C. is a limited
liability company whose sole member is SZ Investments, L.L.C. SZ
Investments, L.L.C. is a limited liability company whose sole managing
member is a corporation wholly owned by the Sam Investment Trust. The
non-managing members are two partnerships whose partners are trusts created
for the benefit of Mr. Zell and his family. Mrs. Lurie is the beneficiary
and a co-trustee of the Robert H. and Ann Lurie Trust. Anda Partnership and
LFT Partnership are general partnerships, the partners of which are trusts
created for the benefit of Mrs. Lurie and her family. Mr. Zell and Mrs.
Lurie disclaim beneficial ownership of the stock owned by SZRL Investments.
Mr. Zell disclaims beneficial ownership of the stock owned by the Robert H.
and Ann Lurie Trust, Anda Partnership and LFT Partnership. Mrs. Lurie
disclaims beneficial ownership of the stock owned by Samstock/SIT, L.L.C.
and Samstock, L.L.C. The amounts shown include 75,000 shares obtainable
within 60 days of the date of this table by the exercise of options by Mr.
Zell.
(2) The general partner of TIG Partners, L.P. is PDA Corp. All of the issued and
outstanding capital stock of PDA Corp. is owned by Nicholas J. Pritzker.
(3) According to a Schedule 13G, dated January 28, 2000, Lazard Freres & Co. LLC
has sole power to vote 2,075,700 shares and sole power to dispose of
2,511,970 shares.
(4) All options exercisable within 60 days of the date of this table which may
be deemed to be beneficially owned by the person or persons for whom the
calculation is being made are deemed to have been exercised for the purpose
of calculating this percentage.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
For a description of transactions between the Company and an affiliate of
Messrs. Zell and Dammeyer and Mrs. Rosenberg, see "Compensation Committee
Interlocks and Insider Participation."
13
<PAGE> 16
PROPOSAL 1
APPROVAL OF MANAGEMENT INCENTIVE PLAN
Executives of the Company earn bonuses under a Management Incentive Plan
(the "MIP") adopted each year by the Compensation Committee (the "Committee") of
the Board of Directors. The Committee has determined that the availability of
the MIP for 2000 and subsequent years should be subject to the approval of the
MIP by the stockholders of the Company at the 2000 Annual Meeting. In addition,
the payment of the award earned by Messrs. Grubbs and Letham under the enhanced
portion of the MIP for 1999 is subject to the approval of the stockholders at
this meeting. See "Compensation Committee Report on Executive Compensation."
Approval of the stockholders is being sought so that, to the maximum extent
permitted, the amounts paid pursuant to the MIP will not be subject to, or cause
other compensation to be subject to, the limitations imposed by the Omnibus
Budget Reconciliation Act of 1993 (the "Act") on the deductibility of executive
compensation under Section 162(m) of the Internal Revenue Code (the "IRS Million
Dollar Limitation"). To date the IRS Million Dollar Limitation has not had any
significant impact of the Company.
The purpose of the MIP is to provide awards to the executives of the
Company for the achievement of specified financial or other objective goals of
the Company for a year or for a specified number of years. Additionally, a
minority portion of the target of a participant may be dependent on the
subjective determination of the Committee or an executive officer of the
achievement of qualitative goals. Any subjectively determined amounts will
continue to be subject to the IRS Million Dollar Limitation. All executive
officers, their direct reports, and other key employees with annual salaries in
excess of $150,000 are eligible to be selected to receive an award under the
MIP. (Other selected employees participate in similar plans that the
stockholders are not being asked to approve.) The participants in the MIP are
determined each year by the Committee and the number of participants will vary
from year to year. In 2000, six executive officers and 37 other executives are
participating in the MIP.
A target expressed as a percentage of salary is assigned each year by the
Committee to participants. The targets, which currently range from 190% to 20%
percent of salary, may be as high as 200% and as low as 20% of salary. The
actual awards may range from zero to 200% of the assigned targets depending on
the achievement of the objectives established by the Committee (or in the case
of qualitative goals, by the Committee or an executive officer) during the first
90 days of each year.
The financial objectives may be (i) operating, pretax, or net earnings of
the Company, a subsidiary, a division or business unit thereof, or an other
entity where there is a significant investment by the Company and opportunity to
influence the performance of that entity; (ii) earnings per share of the
Company; (iii) cash flow of any of these entities; (iv) return on capital,
tangible or total, employed by any of these entities as measured by any of these
earnings; (v) achievement of specified revenues or proceeds from specified
activities, in or out of the ordinary course of business, or (vi) other similar
financial objectives that the Committee determines to be in the interest of the
Company. Which of these measures are utilized and the percent of target earned
by the levels of achievement of the selected measures, including the weighting
of the selected measures, is determined by the Committee when the objectives for
the year are established.
The targets, measures and weighting utilized for 1999 are discussed above
under "Compensation Committee Report on Executive Compensation."
The Committee is comprised of "outside" directors as provided by the
regulations under the Act. The Committee has the authority and responsibility
for the interpretation, administration and application of the provisions of the
MIP, and the Committee's interpretation of the MIP and all actions taken by it
and determinations made by it are binding on the participants and the Company.
No Board or Committee member will be liable for any determination, decision or
action made or taken under the MIP in good faith.
The Committee may amend or terminate the MIP at any time, provided however,
that in no event can the Committee, after the period for establishing the
objectives for a year, adjust for that year any targets, objectives, or the
percent of target earned by levels of achievement of each objective in a manner
that would
14
<PAGE> 17
increase the amount of compensation that would be payable under the MIP without
such adjustment. Any such compensation would be outside the MIP and subject to
the IRS Million Dollar Limitation.
No participant in the MIP may receive an annual award under the MIP of more
than $3,000,000 as this amount is increased by inflation in the Consumer Price
Index after December 31, 2000. Except as described below, amounts earned under
the MIP are determined and paid as soon as practical after the end of each year
or if based on multiple years, the end of the last year of that period. To the
extent permitted by the applicable regulations of the Internal Revenue Service
and the terms of the Company's 401(k) saving plan, such amounts may be
contributed by the participants to that plan. To the extent such contribution is
not permitted by the applicable regulations, executive officers and other
participants designated by the Committee may elect to defer payment of amounts
earned under the MIP to a later date under deferred compensation arrangements
adopted by the Company from time to time. Currently executive officers and other
participants designated by the Company are eligible to defer payment of all or
such portion of awards under the MIP as they individually determine. Such
deferred amounts currently accrue interest at 140% of the U.S. Treasury 10-year
note rate in effect from time to time, plus up to 200 basis points for the
achievement of financial objectives as described above. The Committee in
establishing the MIP for a year may determine that all or a portion of an award
payable under the MIP to certain participants shall or may be paid in Common
Stock or phantom stock that may or may not be restricted. The computation of the
amount of stock may be based on the average market price of the stock over a
period, up to one year, selected by the Committee, or based on a percentage, not
to be less than 75%, of the market price of the stock at the end of the year for
which the award was earned, or during a period during the last month of that
year selected by the Committee. For description of current use of restricted
stock, see "Compensation Committee Report on Executive Compensation."
The amounts that will be paid pursuant to the MIP for 2000 and subsequent
years are not determinable at this time. Set forth below are the amounts earned
under the MIP for 1999:
<TABLE>
<CAPTION>
NAME & PRINCIPAL POSITION $ EARNED
------------------------- --------
<S> <C>
Robert W. Grubbs............................................ 1,487,560
Rod Dammeyer................................................ 0
Dennis J. Letham............................................ 882,034
Lisa Kearns Lanz............................................ 119,100
John A. Dul................................................. 88,000
All executive officers, including the above named persons... 2,700,494
All employees, other than those who are executive
officers.................................................. 5,680,430
</TABLE>
- ---------------
* Includes value as of February 18, 2000 of restricted shares of Common Stock
vesting over 4 years, which in the case of 59,406 and 35,231 shares for
Messrs. Grubbs and Letham, respectively, are subject to the approval by the
stockholders of the MIP.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 1.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the rules of the Securities and Exchange Commission, the Company is
required to report, based upon its review of copies of reports to the Securities
and Exchange Commission about ownership of and transactions in its stock
furnished to the Company and written representations of its directors and
officers about such ownership and transactions, that in 1999, a report required
to be filed on Form 4 by James E. Knox, an executive officer of the Company, was
filed late due to a Company oversight.
INDEPENDENT AUDITORS
The Board of Directors, upon the recommendation of its Audit Committee, has
selected Ernst & Young LLP as independent auditors of the Company for 2000.
Ernst & Young LLP (and predecessor firm) have audited the Company's financial
statements since 1980. Representatives of Ernst & Young LLP, who are
15
<PAGE> 18
expected to be present at the meeting, will be given an opportunity to make a
statement if they so desire and to respond to appropriate questions asked by
stockholders.
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the 2001 Annual
Meeting of Stockholders must be received by the Company at its principal offices
by December 20, 2000 in order to be considered for inclusion in the Company's
Proxy Statement and Proxy relating to the 2001 Annual Meeting of Stockholders.
CONCLUSION
The Board of Directors knows of no other matters to be presented for
stockholder action at the meeting. However, if other matters do properly come
before the meeting, it is intended that the persons named in the proxies will
vote upon them in accordance with their best judgment.
April 19, 2000
BY ORDER OF THE BOARD OF DIRECTORS
LOGO
JAMES E. KNOX, Secretary
16
<PAGE> 19
ANIXTER MANAGEMENT INCENTIVE PLAN
1. PURPOSE AND EFFECTIVE DATE. Anixter Inc. has established this
Management Incentive Plan (the "Plan") to provide awards to its executives and
other key employees for the achievement of goals for a year or a specified
number of years. The effective date of the Plan shall be January 1, 1999 subject
to the approval of the shareholders of Anixter International Inc. (the
"Company") at the 2000 Annual Meeting.
2. ADMINISTRATION. The Plan shall be administered by the Board of
Directors, or the Compensation Committee of the Company's Board of Directors or
such other Board committee as the Board may designate (the "Committee"). The
Committee has the authority and responsibility for the interpretation,
administration and application of the provisions of the Plan, and the
Committee's interpretations of the Plan, and all actions taken by it and
determinations made by it shall be binding on all persons. No Board or Committee
member shall be liable for any determination, decision or action made in good
faith with respect to the Plan.
3. AWARDS UNDER THE PLAN. A target expressed as a percentage of salary
shall be assigned each year by the Committee to participants. The targets may be
as high as 200% and as low as 20% of salary.
At least 51% of the target shall be dependent on the achievement of
financial objectives such as (i) operating, pretax, or net earnings of the
Company, a subsidiary, a division or business unit thereof, or an other entity
where there is a significant investment by the Company and opportunity to
influence the performance of that entity; (ii) earnings per share of the
Company; (iii) cash flow of any of these entities; (iv) return on capital,
tangible or total, employed by any of these entities as measured by any of these
earnings; (v) achievement of specified revenues or proceeds from specified
activities, in or out of the ordinary course of business, or (vi) other similar
financial objectives that the Committee determines to be in the interest of the
Company. Up to 49% of the target of a participant may be dependent on the
subjective determination of the Committee or an executive officer of the
achievement of qualitative goals.
The actual awards may range from zero to 200% of the assigned targets
depending on the achievement of the objectives established by the Committee (or
in the case of qualitative goals, by the Committee or an executive officer)
during the first 90 days of the year.
4. ELIGIBILITY. All executive officers of the Company and their direct
reports and all other key employees of the Company and its subsidiaries with
annual salaries in excess of $150,000 are eligible to be selected to receive an
award under the Plan by the Committee. The Committee may
<PAGE> 20
condition eligibility under the Plan or participation under the Plan, and any
award under the Plan on such conditions, limitations or restrictions as the
Committee determines to be appropriate for any reason and consistent with the
terms of the Plan. No person may be awarded for any one year more than
$3,000,000, as this amount is adjusted for inflation in the Consumer Price Index
after December 31, 2000.
5. PAYMENT OF AWARDS. Amounts earned under the Plan shall be determined
and be paid as soon as practical after the end of each year or if based on
multiple years, the end of the last year of that period. The Committee in
establishing the targets and goals for a year may determine that all or a
portion of an award payable under the Plan to certain participants shall or may
be paid in stock or phantom stock of the Company that may or may not be
restricted. The computation of the amount of stock may be based on the average
market price of the stock over a period, up to one year, selected by the
Committee, or based on a percentage, not to be less than 75%, of the market
price of the stock at the end of the year for which the award was earned or
during a period during the last month of that year selected by the Committee
6. AMENDMENT OF THE PLAN. The Committee may amend or terminate the Plan
at any time, provided however, that in no event can the Committee, after the
period for establishing the objectives for a year, adjust for that year any
targets, objectives, or the percent of target earned by levels of achievement of
each objective in a manner that would increase the amount of compensation that
would be payable under the Plan without such adjustment.
<PAGE> 21
PROXY PROXY
PROXY SOLICITED BY AND ON BEHALF OF
THE BOARD OF DIRECTORS OF
ANIXTER INTERNATIONAL INC.
<TABLE>
<S> <C>
The undersigned hereby appoints Robert W. Grubbs, Jr., Dennis J. COMMENTS/ADDRESS CHANGE:
Letham and James E. Knox and each of them (with full power of substitution (PLEASE MARK COMMENT/ADDRESS
in each) proxies of the undersigned to vote at the Annual meeting of BOX ON REVERSE SIDE.)
Stockholders of Anixter International Inc. to be held at 11:00 A.M., Central
Time, May 25, 2000, at Two North Riverside Plaza, 6th Floor, Chicago, -----------------------------------
Illinois, and at any adjournments thereof, all of the shares of Common Stock
of Anixter International Inc. in the name of the undersigned on the record -----------------------------------
date.
-----------------------------------
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE
MANNER DIRECTED BY THE UNDERSIGNED STOCKHOLDER. UNLESS -----------------------------------
OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE
ELECTION OF ALL NOMINEES AND FOR THE APPROVAL OF THE -----------------------------------
MANAGEMENT INCENTIVE PLAN.
-----------------------------------
PLEASE SIGN AND DATE THE PROXY CARD ON THE REVERSE SIDE.
</TABLE>
- --------------------------------------------------------------------------------
/\ FOLD AND DETACH HERE /\
<PAGE> 22
<TABLE>
<S> <C> <C> <C> <C>
----
1. Election of the following nominees as directors: PLEASE CHECK BOX IF YOU | |
Lord James Blyth, Robert L. Crandall, Rod F. Dammeyer, FOR WITHHOLD INTEND TO BE PRESENT | |
Robert E. Fowler, Jr., Robert W. Grubbs, Jr., F. Phillip ALL NOMINEES AUTHORITY AT MEETING ----
Handy, Melvyn N. Klein, John R. Petty, Sheli Z. Rosenberg, ----- -----
Stuart M. Sloan, Thomas C. Theobald and Samuel Zell. | | | |
| | | |
Withhold for the following only: ----- -----
(Instruction: Write the name of the nominee(s) from whom you are COMMENT/ADDRESS CHANGE
withholding your vote in this space). Please mark this box ----
if have written | |
- ------------------------------------------------------------------ comments/address | |
FOR AGAINST ABSTAIN change on the reverse ----
----- ----- ----- side.
2. Approval of Management Incentive Plan. | | | | | |
| | | | | | 3. In their discretion, such other matters as
----- ----- ----- properly may come before the meeting or at any
adjournment(s) thereof.
Dated: , 2000
---------- ---------------------
|
| ---------------------------------
| (Signature of Stockholder
|
---------------------------------
(Signature if held Jointly)
IMPORTANT: Please date this proxy
and sign exactly as your name
appears hereon. If stock is held
jointly, both holders should
sign. Executors, administrators,
trustees, guardians and others
signing in a representative
capacity should give full title.
PLEASE MARK, SIGN, DATE, AND
RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
</TABLE>
- --------------------------------------------------------------------------------
/\ FOLD AND DETACH HERE /\
