SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ x ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2)
[ ] Definitive Proxy Statement
[ X ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S)
240.14a-12
MAXXAM INC.
- -----------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
<PAGE>
THE COMMITTEE OF CONCERNED MAXXAM SHAREHOLDERS
- -----------------------------------------------------------------
(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>
HOUSTON CHRONICLE May 20, 1999
WHILE OPPONENTS HAVE THEIR SAY,
MAXXAM MEETING STAYS PEACEFUL
By SHANNON BUGGS
Section: Business, p. 2 Copyright 1999 Houston Chronicle
POINT BLANK -- Before entering the country club conference room
where Maxxam held its annual shareholders meeting here Wednesday,
all guests passed through three security checkpoints, including a
metal detector.
Once inside, everyone received a colored Headhunters offer
wristband that dictated where they could go inside the building.
"The Maxxam folks called and said they had had threats before,"
said Sheriff Lacy Rogers of San Jacinto County, who coordinated
about 40 law enforcement officers on site. "We just wanted this
to be safe for everybody."
The circus atmosphere that has permeated Houston-based Maxxam's
annual gathering for the past few years was not apparent on the
wooded grounds of the Waterwood National Resort and Country Club
near Huntsville. And although one young man called Houston
financier Charles Hurwitz "evil," for the most part the
environmentalists and United Steelworkers members who spoke at
the company's meeting kept the vitriol to a minimum.
The two groups shared a common agenda -- to get two independent
directors elected to the five-member board -- and by joining
forces they did more to disquiet Maxxam's management than any
insults could.
A final count was not available Wednesday, but company officials
said preliminary results show that board incumbents Robert
Cruikshank and Stanley Rosenberg defeated the coalition's
nominees, former U.S. Sen. Howard Metzenbaum, D-Ohio, and Abner
Mikva, a former Democratic congressman from Illinois and federal
appeals judge.
"We're happy with what we've seen so far," said Josh Reiss, a
Maxxam spokesman. "The margin is very wide."
The coalition formed between the Rose Foundation for Communities
and the Environment and the United Steelworkers of America
conceded defeat, but said its tallies indicate it won 25 percent
of the vote not controlled by Hurwitz, which amounts to about 15
percent of the stockholders. Hurwitz owns 38 percent of Maxxam's
common stock.
"Two years ago, when we did this, we got about 3 percent," says
Tim Little, executive director of the Rose Foundation. "The next
time, we just may get the simple majority that we need."
Union official David Foster said the vote underscored investor
dissatisfaction with Maxxam's leadership.
"This is the third set of proxy initiatives that Maxxam has had
to face in a row," he said. "That should tell Wall Street that
there is a severe lack of confidence in this current board."
The union got involved in the proxy battle after 3,000 of its
members who work for Maxxam's subsidiary Kaiser Aluminum &
Chemical Corp. went on strike in September. The contract
negotiations have made little progress and the union offered in
January to return the workers to their jobs without a contract.
That offer was met with a lockout.
Throughout the stockholders meeting, steelworkers clad in
T-shirts asked Hurwitz when he would return to the table and when
he would put them back to work. Hurwitz, dressed in a dark suit
and a red patterned tie, referred most of those questions to
Kaiser's chairman and chief executive officer, George Haymaker.
But Hurwitz did say in his prepared speech that "Kaiser did not
seek this dispute." Laughter broke out in the audience of about
300 people at that point, but Hurwitz continued. "Kaiser is still
committed to negotiating a win-win labor agreement," he said.
He went on to commend another subsidiary for ending a dispute
over logging in an ancient stand of redwood trees in Northern
California that has made Maxxam a target of environmental
activists for more than a decade.
In March, Pacific Lumber Co. sold 7,500 acres of the Headwaters
Forest to the state of California and the federal government for
$480 million. The company also agreed to severe logging
limitations in endangered species habitats for the next 50 years.
Environmental activists vowed Wednesday to continue their fight
with Maxxam, even though the issue that propelled them to buy its
stock to voice opposition to the timber harvesting has been
resolved. They want Maxxam to use the money from the Headwaters
agreement to reduce the company's junk-bond debt and settle a
lawsuit over a failed savings and loan in which Hurwitz is
embroiled.
"We don't trust this board to use the money responsibly and to
stop wreaking environmental dangers," said Jill Ratner, president
of the Oakland, Calif.-based Rose Foundation.
Reiss, the Maxxam spokesman, said the Headwaters money is in
escrow and no decision has been made as to how it will be spent.
Cindy Allsbrook, a resident of San Jacinto County and the mother
of a 24-year-old protester who was killed when a tree felled by a
Pacific Lumber logger struck him, also asked during the meeting
that Hurwitz review the lumber company's safety precautions and
report back to her what he finds. He promised to do so.
Leaving the Maxxam meeting was much easier than entering it.
Rogers stood by his patrol car at the exit driveway and spoke to
drivers before they pulled out and onto FM 980.
"Are you leaving now?" he asked one departing environmental
activist.
"Yes, I am," the driver of the battered red Honda Civic said.
"Well, please come back to see us," the sheriff said as he tipped
his hat. "We hope you had fun."
<PAGE>
HOUSTON CHRONICLE May 19, 1999
MAXXAM's FOES FIGHT BY PROXY
BUT BOARD CANDIDATES ARE UNLIKELY TO WIN SEATS
BY DAVID IVANOVICH
Houston Chronicle Washington Bureau
Section: Business, p. 1C Copyright 1999 Houston Chronicle
WASHINGTON--Environmentalists and union activists are hoping
today to take their battles with Maxxam from the treetops and
picket lines to the boardroom.
The Rose Foundation for Communities and the Environment and the
United Steelworkers of America are sponsoring two candidates for
the board of the Houston company, which has long been on the
other side in fights over chopping redwoods in California and the
lockout of workers at the company' aluminum operation.
The dissident nominees -- former Democratic Sen. Howard
Metzenbaum of Ohio and one-time White House counsel Abner Mikva -
- - have almost no chance of winning. The company's biggest
shareholders have the votes to re-elect San Antonio attorney
Stanley Rosenberg and retired Deloitte & Touche senior partner
Robert Cruikshank.
The company responds that the dissident candidates have little
knowledge of Maxxam
SEE MAXXAM ON PAGE 4C
MAXXAM
Continued from Page 1C
and while they were in office they backed legislation that ran
counter to its interests.
But the dissident candidates have garnered support from a number
of large institutional investors, including the California Public
Employees Retirement System -- the nation's largest public
pension fund -- and the New York State Common Retirement Fund.
"The fact that Maxxam is facing its second proxy contest in three
years indicates the incumbent board is not a poster child for
good governance and performance," argues Stephen Sears, a senior
analyst for Institutional Shareholder Services, a Rockville, Md.-
based firm that provides proxy voting and corporate governance
services.
Maxxam is the aluminum, lumber, real estate and racetrack company
controlled by Houston financier Charles Hurwitz. Hurwitz,
through his personal holdings and stock held in family trusts,
controls 38 percent of Maxxam's 7 million common shares.
Maxxam shares closed at 63, down 1/2, Tuesday on the American
Stock Exchange, near the 52-week high of 64 3/4. But Sears
concluded the company's stock has consistently underperformed
stocks of comparable companies in recent years.
The environmentalists and Steelworkers are trying to persuade
Maxxam's remaining shareholders they would have a better chance
of profiting from their investment if the Maxxam board of
directors had some fresh blood.
"Institutions work best when they're open to new ideas and new
personalities," argued Jill Ratner, president of the Oakland,
Calif.-based Rose Foundation.
The dissidents took out a full-page ad in The New York Times last
week, featuring a rubber stamp labled "Hurwitz Board" that read:
"Okey-Dokey."
They pointed to a December 1997 list in Business Week that ranked
Maxxam's five-member board as one of the worst in the nation.
The magazine called Maxxam's panel "a tiny board with little
business experience dominated by CEO."
Environmentalists and union members held a candlelight vigil near
Hurwitz's home earlier this week and staged a rally at Maxxam
headquarters Tuesday.
Maxxam management, in a letter to shareholder, characterized the
Rose Foundation and Steelworkers as "narrow special interest
groups who have their own agendas to advance."
The Rose Foundation, Maxxam argued, has supported federal
regulators in their still-pending case against Maxxam and Hurwitz
over the 1988 failure of United Savings Association of Texas.
Metzenbaum and Mikva, management said, have demonstrated "an
alarming lack of knowledge about Maxxam."
The two men have little financial stake in the company.
Metzenbaum owns no Maxxam common stock, while Mikva holds 50
shares. Neither candidate was planning to attend today's
meeting.
Company officials painted Metzenbaum and Mikva as policy-maker
who advocated higher taxes, heftier energy costs and restricted
trade.
Metzenbaum, during his tenure in the Senate, championed one of
labor's biggest legislative victories in the past two decades --
the plant-closing law that requires employers, under certain
circumstances, to give employees 60 days' notice before
conducting a major layoff.
Mikva, during his five terms as a representative from Illinois,
earned a reputation as one of the most liberal lawmakers on
Capitol Hill.
The skirmish over board seats is just the latest in a long series
of battles between Maxxam and environmentalists over the last
decade.
Angered by logging practices of Pacific Lumber Co., Maxxam's
Scotia, Calif.-based subsidiary, environmentalists have conducted
numerous demonstrations and filed scores of lawsuits over the
years. Activist Julia Butterfly has made a Pacific Lumber-owned
redwood her tree, living high in the branches of a tree she has
dubbed Luna.
In March, Pacific Lumber agreed to sell the Headwaters Forest in
northern California -- the largest stand of centuries-old redwood
tress left in private hands -- to the federal and California
governments in a $450 million deal.
Rosenberg, who has served on the Maxxam board since 1981 as the
company grew from a small holding company into a multibillion-
dollar enterprise, called the Headwaters agreement "the most
dramatic environmental settlement in the history of the country,
to protect probably one of the largest stands of ancient redwood
trees in the United States."
That deal, Rosenberg noted, was "accomplished with our current
board, must to the benefit of our shareholders as well as the
rest of the country."
But that agreement -- applauded by the White House -- has not
ended the bitter feud.
This year, the Steelworkers have joined in, as a result of labor
troubles at Maxxam's biggest operation, Kaiser Aluminum. Maxxam
owns 63 percent of the fourth-largest aluminum maker in North
America.
Last October, 2,900 Steelworkers went out on strike at five
Kaiser plants in a dispute over job security and pension
benefits.
In January, the union members offered to go back to work, but the
company locked them out. The union has filed a complaint with
the National Labor Relations Board, but no ruling has been handed
down.
Thomas Van Leeuwen, a metals analyst for Credit Suisse First
Boston Corp. in New York who toured two of the Kaiser plants in
the state of Washington, concluded that the company was managing
to run its plants effectively with temporary workers, and that
the union will eventually return to a workplace that has changed
substantially.
But Van Leeuwen noted: "We worry about the disruptions in
productivity that we think are likely to occur when strikers
return to the job: The wounds of this labor battle may take a
long time to heal.
For Mikva, it is that determination to always fight it out --
with environmentalists, with regulators or with labor -- that
represents what is wrong with Maxxam and its current board.
"It's a bunker mentality," Mikva argued in an interview. "It's
just us against them: 'We've got to fight everybody tooth and
nail rather than look for ways to cooperate."
<PAGE>
THE WALL STREET JOURNAL May 19, 1999 Texas Edition, p. T 4
MAXXAM DISSIDENTS RECEIVE BOOST
By Mitchel Benson
SACRAMENTO -- A shareholder-advisory firm has given an unexpected
boost to the efforts of a coalition of investors, labor and
environmentalists to reshape the board of Houston-based Maxxam
Inc. at today's shareholders' meeting.
Institutional Shareholder Services of Rockville, Md., has
recommended that its subscribers vote to elect the coalition's
two independent, "dissident" candidates to Maxxam's five-member
board. The two men are former Ohio Sen. Howard Metzenbaum, 81
years old, and Abner Mikva, 73, who has been an Illinois
congressman, a federal appellate judge and counsel to President
Clinton.
(The coalition includes the California Public Employees'
Retirement System, which has endorsed the two men. Calpers owns
229,800 shares of Maxxam common stock -- roughly 3% of the
total.)
In a May 13 report to its 500 subscribers, Institutional
Shareholder Services wrote that Messrs. Metzenbaum and Mikva
"will bring the same sense of fairness and vigorous effort that
they brought to their previous capacities as a senator,
congressman and judge to Maxxam shareholders."
In the same report, senior analyst Stephen Sears points out that
Maxxam -- a timber, aluminum, real-estate and racing concern --
is facing its second proxy contest in three years over
independent directors. That fact, Mr. Sears writes, "indicates
that the incumbent board is not a poster child for good
governance and performance."
The firm's analysis is significant because it typically is "more
in favor of management than dissidents," says spokesman Patrick
McGurn. "We tend to put a higher burden on dissidents to prove
they're going to make a difference if they're elected to the
board, and that they're going to serve the interests of all
shareholders."
Maxxam spokesman Joshua Reiss says the company is "disappointed"
by the firm's recommendations. He says other aspects of the
report confirm Maxxam's concerns that the coalition's leaders --
the Rose Foundation for Communities and the Environment, an
Oakland-based environmental group; and the United Steelworkers --
"are groups that in the past have not necessarily acted in the
best interests of stockholders."
What's more, says Mr. Reiss, Maxxam has alerted its shareholders
to Messrs. Metzenbaum's and Mikva's congressional voting records
- -- records, Mr. Reiss says, that Maxxam sees as "indicative of
preferences for higher taxes, higher energy costs and restrictive
trade."
But Jill Ratner, president of the Rose Foundation, defended her
slate. In Congress, she says, "Messrs. Metzenbaum and Mikva were
strong and effective advocates for their constituents.... If they
are elected to the Maxxam board, their only constituents will be
the common shareholders of this company."
Despite the advisory firm's recommendations, Maxxam's Mr. Reiss
says his boss -- Maxxam Chairman and Chief Executive Charles
Hurwitz -- remains confident about today's outcome. Mr. Reiss
confirms that during Mr. Hurwitz's interview with Mr. Sears of
Institutional Shareholder Services, he told the analyst, "I don't
care what you or anybody else recommends. We're going to win and
win big."
Copyright 1999 Dow Jones & Company, Inc. All Rights Reserved.
<PAGE>
