<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:
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
LAFARGE CORPORATION
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] 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
[LAFARGE CORPORATION LOGO]
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 2, 2000
The 2000 annual meeting of stockholders of Lafarge Corporation will be
held at The Ritz Carlton Hotel, 1700 Tysons Boulevard, McLean, Virginia, on
Tuesday, May 2, 2000, beginning at 9:00 a.m. local time. At the meeting, the
holders of the Company's Common Stock and the holders of the Exchangeable
Preference Shares of our subsidiary, Lafarge Canada, Inc. -- through an
agreement with Montreal Trust Company whereby it votes the Company's Voting
Stock as instructed by holders of Exchangeable Preference Shares -- will act on
the following matters:
(1) Election of directors for the ensuing year;
(2) Ratification of the appointment of Arthur Andersen LLP
as the Company's independent accountants for fiscal year
2000;
(3) An amendment to our articles of incorporation increasing
the number of authorized shares of Common Stock; and
(4) Any other matters that properly come before the meeting.
Holders of record of the Company's Common Stock and of the Exchangeable
Preference Shares of our subsidiary, Lafarge Canada, Inc., at the close of
business on March 6, 2000 are entitled to vote, or in the case of the
Exchangeable Preference Shares, to direct the vote of the Company's Voting
Stock, at the meeting or any postponements or adjournments of the meeting.
Please submit your proxy, or in the case of the Exchangeable Preference
Shares your instructions to the Montreal Trust Company, as soon as possible so
that your shares can be voted at the meeting in accordance with your
instructions
By Order of the Board of Directors
David C. Jones
Vice President - Legal Affairs
and Secretary
March __, 2000
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<S> <C>
ABOUT THE MEETING.....................................................................................................1
Why am I receiving these materials?.............................................................................1
What information is contained in these materials?...............................................................1
What proposals will be voted on at the meeting?.................................................................1
What is Lafarge Corporation's voting recommendation?............................................................1
What is the record date and how many shares were outstanding on the record date?................................1
What constitutes a quorum?......................................................................................1
What shares owned by me can be voted?...........................................................................2
How do I vote?..................................................................................................2
Can I change my vote?...........................................................................................2
What vote is required to approve each item?.....................................................................2
How will abstentions and broker non-votes affect the election of directors and approval of the matters
to be considered at the meeting?.........................................................................3
What does it mean if I receive more than one proxy or voting instruction card?..................................3
Where can I find the voting results of the meeting?.............................................................3
STOCK OWNERSHIP.......................................................................................................4
Who are the largest owners of the Company's stock?..............................................................4
How much stock do the Company's directors and executive officers own?...........................................5
ITEM 1 - ELECTION OF DIRECTORS........................................................................................7
Who are the nominees standing for election as directors?........................................................7
How are directors compensated?..................................................................................9
What committees has the Board established?.....................................................................10
Other Information..............................................................................................11
Section 16(a) Beneficial Ownership Reporting Compliance........................................................11
EXECUTIVE COMPENSATION...............................................................................................12
Report on Executive Compensation...............................................................................12
Compensation Committee Interlocks and Insider Participation....................................................14
Summary Compensation Table.....................................................................................15
Option Exercises and Year-End Values...........................................................................16
Option Grants..................................................................................................16
Performance Graph..............................................................................................17
Retirement Plans...............................................................................................17
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.......................................................................19
Indebtedness of Management.....................................................................................19
Transactions with Management and Others........................................................................19
ITEM 2 - RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS......................................................20
ITEM 3 - PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION TO INCREASE
AUTHORIZED COMMON STOCK................................................................................21
OTHER MATTERS........................................................................................................22
Are other matters to be considered at the annual meeting?......................................................22
When must stockholder proposals for the 2001 annual meeting be submitted?......................................22
Who will bear the cost of soliciting proxies for the annual meeting?...........................................22
How do I obtain a copy of the company's Form 10-K Annual Report?...............................................22
</TABLE>
i
<PAGE> 4
[LAFARGE CORPORATION LOGO]
11130 SUNRISE VALLEY DRIVE, SUITE 300
RESTON, VIRGINIA 20191
-------------------------
PROXY STATEMENT
-------------------------
This proxy statement contains information relating to the annual meeting
of stockholders of Lafarge Corporation to be held at The Ritz Carlton Hotel,
1700 Tysons Boulevard, McLean, Virginia on Tuesday, May 2, 2000, beginning at
9:00 a.m. local time, and at any postponements or adjournments thereof.
ABOUT THE MEETING
WHY AM I RECEIVING THESE MATERIALS?
The Board of Directors of Lafarge Corporation is providing these proxy
materials to you in connection with Lafarge Corporation's annual meeting of
stockholders scheduled for 9:00 a.m., May 2, 2000 at The Ritz Carlton Hotel,
1700 Tysons Boulevard, McLean, Virginia 22102 . You are invited to attend the
meeting and are requested to vote on the proposals described in this proxy
statement.
WHAT INFORMATION IS CONTAINED IN THESE MATERIALS?
This proxy statement contains information relating to the proposals to be
voted on at the meeting, the voting process, the compensation of our directors
and our most highly paid officers, and certain other required information.
WHAT PROPOSALS WILL BE VOTED ON AT THE MEETING?
There are three proposals scheduled to be voted on at the meeting:
- election of directors for the ensuing year;
- ratification of the appointment of Arthur Andersen LLP as
the Company's independent accountants; and
- an amendment to our Articles of Incorporation increasing
the number of authorized shares of Common Stock.
WHAT IS LAFARGE CORPORATION'S VOTING RECOMMENDATION?
Our board of directors recommends that you vote "FOR" all of the nominees
to the board and "FOR" each of the other proposals.
WHAT IS THE RECORD DATE AND HOW MANY SHARES WERE OUTSTANDING ON THE RECORD DATE?
The record date for the annual meeting is March 6, 2000. At the close of
business on the record date, there were ______ shares of Common Stock, par value
$1.00 per share, and ______ Exchangeable Preference Shares of our subsidiary,
Lafarge Canada, Inc. outstanding.
WHAT CONSTITUTES A QUORUM?
The presence at the meeting in person or by proxy of the holders of a
majority of the combined total of the Company's Common Stock and the
Exchangeable Preference Shares of our subsidiary, Lafarge Canada, Inc. (through
instructions to the Montreal Trust Company as to how to vote the Company's
Voting Stock) outstanding
1
<PAGE> 5
on the record date will constitute a quorum. Broker non-votes and shares
represented by proxies received but marked as abstentions will be counted as
present for purposes of determining the quorum.
WHAT SHARES OWNED BY ME CAN BE VOTED?
You may vote all of the Company's Common Stock and Exchangeable
Preference Shares of our subsidiary, Lafarge Canada, Inc., owned by you as of
the record date, March 6, 2000.
HOW DO I VOTE?
Common Stock Held Directly by You. If you complete and properly sign the
accompanying proxy card and return it to the Company, it will be voted as you
direct. You may also attend the meeting and deliver your proxy card in person or
otherwise vote in person at the meeting. Even if you plan to attend the annual
meeting, we recommend that you also submit your proxy so that your vote will be
counted if you later decide not to attend the meeting.
Common Stock Held in a Broker's Account or by a Nominee (i.e., held in
"street name"). You may vote shares of Common Stock held by your broker or other
nominee by submitting voting instructions to your broker or nominee. Please
refer to the voting instruction card included by your broker or nominee for
specific instructions on how to submit your vote. You may not vote these shares
in person at the meeting.
Exchangeable Preference Shares. Holders of Exchangeable Preference Shares
are entitled to direct how the Company's Voting Stock is to be voted at the
annual meeting. We have deposited shares of our Voting Stock with the Montreal
Trust Company under an arrangement whereby the Montreal Trust Company is to vote
those shares as directed by holders of Exchangeable Preference Shares. Under
this arrangement, each holder of Exchangeable Preference Shares (other than
Lafarge Corporation and Lafarge Canada, Inc.) may instruct the Montreal Trust
Company how to vote one share of Voting Stock for each Exchangeable Preference
Share held. Please refer to the instruction card included by the Montreal Trust
Company for specific instructions on how to direct your vote. You may not vote
Exchangeable Preference Shares held on the record date in person at the meeting.
Anyone acquiring Exchangeable Preference Shares after the close of
business on the record date, March 6, 2000, may instruct the Montreal Trust
Company to vote the underlying Voting Stock on his or her behalf even though he
or she did not hold the Exchangeable Preference Shares on the record date. To do
so, he or she must notify the Montreal Trust Company in writing no later than
April 18, 2000 either (i) how it should vote the underlying Voting Stock or (ii)
that the holder of the Exchangeable Preference Shares will attend the annual
meeting and vote those shares in person. The Montreal Trust Company must also
receive at its offices in Montreal, Quebec no later than April 18, 2000 properly
endorsed certificates for those shares or other evidence satisfactory to the
Montreal Trust Company that ownership of the Exchangeable Preference Shares has
transferred.
CAN I CHANGE MY VOTE?
Holders of Common Stock may change their vote at any time prior to the
vote at the annual meeting. To change your vote for shares held directly in your
name, you may either grant a new proxy or attend the annual meeting and vote in
person. If you attend the meeting but do not inform us that you wish to change
your vote, your proxy will be voted as previously directed. To change your vote
for shares you beneficially own, you must submit new voting instructions to your
broker or nominee. To change your vote for Exchangeable Preference Shares, you
must write to the Montreal Trust Company before it has acted upon your prior
instructions.
WHAT VOTE IS REQUIRED TO APPROVE EACH ITEM?
Election of Directors. The affirmative vote of a plurality of the votes
cast at the annual meeting is required for the election of directors.
Ratification of Appointment of Independent Accountants. The affirmative
vote of a majority of votes cast at the annual meeting either in person or by
proxy with respect to the ratification of the appointment of Arthur Andersen is
required to ratify the appointment of Arthur Andersen as independent accountants
for the Company.
2
<PAGE> 6
Amendment of Articles of Incorporation to Increase Authorized Common
Stock. The affirmative vote of a majority of shares entitled to vote with
respect to the amendment of the Articles of Incorporation to increase authorized
Common Stock (i.e., a majority of all Common Stock and Exchangeable Preference
Shares outstanding) is required to approve such amendment.
HOW WILL ABSTENTIONS AND BROKER NON-VOTES AFFECT THE ELECTION OF DIRECTORS AND
APPROVAL OF THE MATTERS TO BE CONSIDERED AT THE MEETING?
Election of Directors. Abstentions and broker non-votes will not be
counted as votes cast with respect to the election of directors and, therefore,
will have no effect on the result of the vote.
Ratification of Appointment of Arthur Andersen. Abstentions and broker
non-votes will not be counted as votes cast with respect to the ratification of
the appointment of Arthur Andersen and, therefore, will have no effect on the
result of the vote.
Amendment of Articles of Incorporation to Increase Authorized Common
Stock. Abstentions and broker non-votes will be counted as votes against the
proposed amendment of the Articles of Incorporation to increase authorized
Common Stock.
WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE PROXY OR VOTING INSTRUCTION CARD?
If you receive more than one proxy card, your shares are registered
under different names or are in more than one account. Please provide voting
instructions for all proxy and voting instruction cards you receive.
WHERE CAN I FIND THE VOTING RESULTS OF THE MEETING?
We will announce preliminary voting results at the meeting and publish
final results in our quarterly report on Form 10-Q for the second quarter of
fiscal 2000.
3
<PAGE> 7
STOCK OWNERSHIP
WHO ARE THE LARGEST OWNERS OF THE COMPANY'S STOCK?
The table below shows all stockholders known to the Company to
beneficially own (under the rules of the SEC) as of March 6, 2000 more than 5%
of the Company's Common Stock.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP OF CLASS (1)
- ------------------------------------ --------- ------------
<S> <C> <C>
Lafarge S.A. 38,100,364 (2) 52.1%
61, rue des Belles Feuilles
75116 Paris France
FMR Corp. 4,760,967 (3) 6.2%
82 Devonshire Street
Boston, Massachusetts 02199
UBS AG 3,979,925 (4) 5.4%
Bahnhofstrasse 45
8021, Zurich, Switzerland
</TABLE>
- ----------
(1) Calculated based on the number of shares of Common Stock plus the
number of Exchangeable Preference Shares outstanding. Holders of
Exchangeable Preference Shares (other than the Company and Lafarge
Canada, Inc.) have voting rights in the Company through a trust holding
shares of the Company's Voting Stock.
(2) Includes 37,611,844 shares of Common Stock and 488,520 Exchangeable
Preferences Shares of our subsidiary, Lafarge Canada, Inc., held by
Lafarge S.A. either directly or through its beneficial interests in
Lafarge (U.S.) Holdings and Paris-Zurich Holdings (both New York
trusts) and Cementia Holdings A.G., a Swiss corporation and
majority-owned subsidiary of Lafarge S.A.
(3) Based solely on Schedule 13G dated February 14, 2000 filed by FMR Corp.
with the U.S. Securities and Exchange Commission. The Schedule 13G
reports beneficial ownership by FMR Corp. of 4,523,525 shares of Common
Stock, with sole power to dispose or direct the disposition of all such
shares and sole power to vote (or direct the vote of) 23,600 of such
shares. The Schedule 13G also reports that the interest of Fidelity
Magellan Fund, an investment company registered under the Investment
Company Act of 1940, in the shares of Common Stock beneficially owned
by FMR Corp. amounted to 4,481,150 shares, or 6.5% of the Common Stock
outstanding at year end.
(4) Based solely on the review of Schedule 13G dated February 4, 2000 filed
by UBS AG with the U.S. Securities and Exchange Commission. The
Schedule 13G reports beneficial ownership by UBS AG of 3,979,925 shares
of Common Stock, primarily through its indirect wholly owned subsidiary
Brinson Partners, Inc., a registered investment advisor. UBS AG
disclaims beneficial ownership of such shares.
The Company and its parent, Lafarge S.A., are parties to an Option
Agreement dated November 1, 1993. This agreement is intended to enable Lafarge
S.A. to maintain its existing margin of voting control. Through this agreement,
Lafarge S.A. has the right until October 31, 2003 to purchase voting securities
from the Company whenever the Company issues voting securities. This agreement
was approved by the Company's independent directors (i.e. those directors with
no affiliation with Lafarge S.A.) based upon the business advantages to the
Company which result from Lafarge S.A.'s majority ownership of the Company.
Lafarge S.A. is a public company whose voting securities are traded on various
European securities exchanges. Through its worldwide interests, Lafarge S.A. is
principally engaged in the manufacture and sale of cement, concrete, aggregates,
gypsum products,
4
<PAGE> 8
specialty materials and roofing. The Company understands that Lafarge S.A.
presently intends to maintain its position as majority owner of the Company.
HOW MUCH STOCK DO THE COMPANY'S DIRECTORS AND EXECUTIVE OFFICERS OWN?
The table below shows the number of shares of the Company's Common
Stock and the number of shares of the common stock of Lafarge S.A. (the
Company's "parent" as that term is defined in regulations promulgated under the
Securities Exchange Act of 1934, as amended) beneficially owned as of March 6,
2000 by (i) the Company's directors, (ii) the executive officers of the Company
named in the Summary Compensation Table below and (iii) the directors and
executive officers of the Company as a group. Unless otherwise indicated, all
shares are directly owned.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP BENEFICIAL OWNERSHIP
OF THE COMPANY'S OF LAFARGE S.A.
COMMON STOCK (1) (2) COMMON STOCK (2)
------------------------------------ -------------------------------------
NUMBER PERCENT NUMBER PERCENT
NAME OF SHARES OF CLASS OF SHARES OF CLASS
- ---- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Thomas A. Buell 11,500 * 0
Marshall A. Cohen 11,000 (3) * 0
Bertrand P. Collomb 120,236 * 46,696 (4) *
Philippe P. Dauman 4,000 * 0
Bernard L. Kasriel 17,000 * 79,210 *
Jacques Lefevre 3,100 * 12,311 *
Paul W. MacAvoy 12,000 * 0
Claudine B. Malone 10,250 (5) * 0
Robert W. Murdoch 12,100 * 1,536 *
Bertin F. Nadeau 11,041 (6) * 0
John D. Redfern 20,730 * 559 *
Joe M. Rodgers 11,500 (7) * 0
Michel Rose 70,250 * 28,500 *
Ronald D. Southern 11,130 (8) * 0
Gerald H. Taylor 0 0
John M. Piecuch 136,470 * 7,595 *
Edward T. Balfe 113,883 * 0
Peter H. Cooke 54,455 * 0
Larry J. Waisanen 36,665 * 2,584 *
Michael J. Balchunas 42,522 * 0
All directors and executive
officers of the Company
as a group (29 persons) 857,986 * 179,868 *
</TABLE>
- -----------
*Less than 1%
(1) The shares below include (a) Exchangeable Preference Shares of our
subsidiary, Lafarge Canada, Inc., which are exchangeable at the option
of the holder into Common Stock on a one for one basis and (b) Common
Stock and Exchangeable Preference Shares covered by stock options that
were exercisable on March 6, 2000 or within 60 days thereafter
(referred to below as "currently exercisable options"). Holders of
Exchangeable Preference Shares have voting rights in the Company
through a trust holding shares of the Company's Voting Stock and are
entitled to direct the voting of one share of Voting Stock for each
Exchangeable Preference Share held.
5
<PAGE> 9
(2) The number of shares reported for each of the individuals listed below
includes the following number of shares which are not outstanding but
are subject to currently exercisable options:
<TABLE>
<CAPTION>
COMPANY LAFARGE S.A. COMPANY LAFARGE S.A.
NAME COMMON STOCK COMMON STOCK NAME COMMON STOCK COMMON STOCK
---- ------------ ------------ ---- ------------ ------------
<S> <C> <C> <C> <C> <C>
Thomas A. Buell 10,000 John D. Redfern 10,000
Marshall A. Cohen 10,000 Joe M. Rodgers 10,000
Bertrand P. Collomb 112,500 22,222 Michel Rose 70,250 28,182
Philippe P. Dauman 4,000 Ronald D. Southern 10,000
Bernard L. Kasriel 15,000 77,400 John M. Piecuch 128,750 7,468
Jacques Lefevre 3,000 11,111 Michael J. Balchunas 40,500
Paul W. MacAvoy 10,000 Edward T. Balfe 109,375
Claudine B. Malone 10,000 Peter H. Cooke 52,750
Robert W. Murdoch 10,000 Larry J. Waisanen 33,750 2,467
Bertin F. Nadeau 10,000 Total Directors & Officers 806,375
</TABLE>
(3) Includes 1,000 shares owned by Adroit Investments Ltd., which is
controlled by Mr. Cohen.
(4) Includes 22,775 shares held by a family partnership over which Mr.
Collomb has voting power.
(5) Includes 250 shares owned by Financial & Management Consulting, Inc.
which is controlled by Ms. Malone.
(6) Includes 1,023 shares owned by La Financiere Nadeau Ltd. which is
controlled by Mr. Nadeau.
(7) Includes 1,500 shares owned by JMR Investments which is controlled by
Mr. Rodgers and his wife.
(8) Includes 1,130 shares held by Sentgraf Enterprises Ltd., which is
controlled by Mr. Southern.
6
<PAGE> 10
ITEM 1 - ELECTION OF DIRECTORS
WHO ARE THE NOMINEES STANDING FOR ELECTION AS DIRECTORS?
Each of the nominees below has consented to serve as a director if
elected. All are currently directors of the Company. All proxies received,
unless revoked, will be voted for each of the nominees listed below, unless
authorization to so vote is withheld. Cumulative voting is not permitted. If a
nominee should become unavailable to stand for election for any reason, the
persons designated as proxies will have full discretion to cast their votes for
any other person designated by the Board. Below you will find certain background
information regarding each of the nominees.
THOMAS A. BUELL, Director/Consultant of Weldwood of Canada Limited
(diversified manufacturer of paper products). Mr. Buell has served in such
capacity since May 1996. Mr. Buell, age 68, was Chairman of the Board of
Weldwood of Canada Limited from January 1979 to April 1996 and President and
Chief Executive Officer of such company from August 1975 to December 1992. He is
also a director of Placer Dome Inc., B.C. Gas, Inc., Trans Mountain Pipe Line
Company Ltd. and TimberWest Forest Limited. He has served as a director of the
Company since January 1, 1993.
MARSHALL A. COHEN, Counsel, Cassels, Brock & Blackwell, Barristers and
Solicitors. Mr. Cohen, age 64, has served in such capacity since October 1996.
From November 1988 to September 1996, he was President and Chief Executive
Officer and a director of The Molson Companies Limited. He is also a director of
Barrick Gold Corporation, American International Group, Inc. and Clark USA. He
has served as a director of the Company since 1991.
BERTRAND P. COLLOMB, Chairman of the Board of the Company and Chairman
of the Board and Chief Executive Officer of Lafarge S.A. Mr. Collomb, age 57,
has served as Chairman of the Board of the Company since January 1989 and as
Chairman of the Board and Chief Executive Officer of Lafarge S.A. since August
1, 1989. He served as Vice Chairman of the Board and Chief Operating Officer of
Lafarge S.A. from January 1989 to August 1, 1989. He was Vice Chairman of the
Board and Chief Executive Officer of the Company and Senior Executive Vice
President of Lafarge S.A. from 1987 until January 1989. He has served as a
director of the Company since 1985.
PHILIPPE P. DAUMAN, Deputy Chairman and Executive Vice President of
Viacom, Inc. (entertainment). Mr. Dauman, age 46, has served as Deputy Chairman
since January 1996 and as Executive Vice President since March 1994. He has
served as Chief Administrative Officer of such company since March 1994 and also
held the title of General Counsel from January 1993 to October 1998. Previously
Mr. Dauman was a partner of the law firm Shearman & Sterling. He is also a
director of Viacom's parent company, National Amusements, Inc. as well as
Blockbuster, Inc. He has served as a director of the Company since 1997.
BERNARD L. KASRIEL, Vice Chairman of the Board of the Company and Vice
Chairman and Chief Operating Officer of Lafarge S.A. Mr. Kasriel, age 53, was
elected to his current position in May 1996. He has served as Vice Chairman and
Chief Operating Officer of Lafarge S.A. since January 1, 1995. Prior to that he
served as Managing Director of Lafarge S.A. from 1989 to 1994, Senior Executive
Vice President of Lafarge S.A. from 1987 to 1989 and Executive Vice President of
Lafarge S.A. from 1982 until March 1987. Mr. Kasriel is also a director of
Sonoco Products Company. He has served as a director of the Company since 1989.
JACQUES LEFEVRE, Vice Chairman and Chief Operating Officer of Lafarge
S.A. Mr. Lefevre, age 61, has served as Vice Chairman and Chief Operating
Officer of Lafarge S.A. since January 1, 1995. From August 1, 1989 to 1994, he
served as Managing Director of Lafarge S.A. He served as Senior Executive Vice
President of Lafarge S.A. from 1987 to August 1, 1989 and as Executive Vice
President of Lafarge S.A. from 1983 to 1987. He has served as a director of the
Company since 1983.
PAUL W. MACAVOY, Williams Brothers Professor of Management Studies,
Yale School of Management. Mr. MacAvoy, age 65, has been Williams Brothers
Professor since 1992. He served as Dean of the Yale School of Management from
1992 to 1994, as McLaughlin Visiting Professor of Business Administration, Amos
Tuck School, Dartmouth College in 1991, as Lester Crown Visiting Professor, Yale
School of Management from 1990 to 1991 and as Dean and John M. Olin Professor of
Public Policy, W.E. Simon Graduate School of Business Administration, University
of Rochester from 1983 to 1991. He has served as a director of the Company since
1993.
7
<PAGE> 11
CLAUDINE B. MALONE, President of Financial & Management Consulting,
Inc. Ms. Malone, age 63, has served in such capacity since 1982. Ms. Malone is
also a director of Dell Computer Corp., Hannaford Bros. Co., Hasbro, Inc.,
Houghton Mifflin Company, The Limited Inc., Lowe's Companies, Mallinckrodt Inc.,
SAIC Corp. and Union Pacific Resources Corporation. She has served as a director
of the Company since May 1994.
ROBERT W. MURDOCH, Corporate Director. Mr. Murdoch, age 58, was
formerly President and Chief Executive Officer of the Company from January 1989
to August 1992, President and Chief Executive Officer of LCI from 1985 to 1992,
Senior Executive Vice President of Lafarge S.A. from August 1989 to September
1992 and President and Chief Operating Officer of the Company from 1987 to 1989.
Mr. Murdoch is also a director of Lafarge S.A., LCI, Usinor S.A., Sierra Systems
Group Inc., Lallmano, Inc. and Power Corporation International Limited. He has
served as a director of the Company since 1987.
BERTIN F. NADEAU, Chairman of the Board and Chief Executive Officer of
GescoLynx Inc. (a private holding company). Mr. Nadeau has served in such
capacity since September 30, 1994. He was also Chairman of the Board, President
and Chief Executive Officer of Unigesco Inc. from 1982 to September 1994 and
Chairman of the Board of Unigesco's affiliate, Univa Inc. (a marketer and
distributor in the food sector) from October 1989 to July 1993. Mr. Nadeau, age
59, is also a director of Sun Life Assurance Company of Canada. He has served as
a director of the Company since 1988.
JOHN M. PIECUCH, President and Chief Executive Officer of the Company
and Group Executive Vice President of Lafarge S.A. Mr. Piecuch, age 51, has
served as President and Chief Executive Officer of the Company since October 1,
1996 and as Group Executive Vice President of Lafarge S.A. since July 1, 1994.
He served as Senior Executive Vice President of the Company from 1992 to June
30, 1994 and as Executive Vice President of the Company from 1989 to 1992. He
has served as a director of the Company since August 1, 1994.
JOHN D. REDFERN, Chairman of the Board of LCI. Mr. Redfern has served
as Chairman of the Board of LCI since 1984. Mr. Redfern served as Vice Chairman
of the Board of the Company from January 1989 to May 1996, as Chairman of the
Board of the Company from 1985 until January 1989, as President and Chief
Executive Officer of the Company from 1983 until 1985 and as Chief Executive
Officer of LCI from 1977 to 1985. Mr. Redfern, age 64, is also a director of
LCI. He has served as a director of the Company since 1983.
JOE M. RODGERS, Chairman, The JMR Group (investment company). Mr.
Rodgers, age 66, served as the United States Ambassador to France from 1985
until 1989. He is also a director of AMR Corporation/American Airlines, Inc.,
Gaylord Entertainment Company, SunTrust Bank, Nashville, N.A., Thomas Nelson,
Inc., Towne Services, Inc., and Tractor Supply Company. He has served as a
director of the Company since 1989.
MICHEL ROSE, Group Senior Executive Vice President of Lafarge S.A. Mr.
Rose has served as Senior Executive Vice President of Lafarge S.A. since 1989.
Mr. Rose, age 57, served as President and Chief Executive Officer of the Company
from September 1, 1992 until September 30, 1996. He served as Chairman and Chief
Executive Officer of Orsan S.A., a subsidiary of Lafarge S.A., from 1987 to
1992. He has served as a director of the Company since 1992.
RONALD D. SOUTHERN, Chairman of the Board and Chief Executive Officer
of ATCO Ltd. (a diversified industrial company) and Chairman of the Board and
Chief Executive Officer of Canadian Utilities Limited (a utility company). Mr.
Southern has served ATCO Ltd. as Chairman of the Board since May 1990 and as CEO
since 1968. He was also President of such company from June 1988 until the end
of 1993. He has been Chairman of the Board of Canadian Utilities Limited since
1981 and he became CEO of such company in January 1994. Mr. Southern, age 69, is
also a director of Canadian Pacific Limited, Fletcher Challenge Canada Limited,
Royal & Sun Alliance Insurance Company of Canada, Chrysler Canada Ltd. and
Southam Inc. He has served as a director of the Company since 1985.
GERALD H. TAYLOR , Telecommunications Consultant and Private Investor.
Mr. Taylor, age 58, served as Chief Executive Officer of MCI from November 1996
to October 1998. He also served as MCI's President and Chief Operating Officer
from July 1994 to November 1996 and as MCI's Chief Operating Officer from April
1993 to July 1994. Mr. Taylor is also a director of CIENA, E2Enet, Inc. and
Voyager.net.
8
<PAGE> 12
There is no family relationship between any of the nominees or between
any of the nominees and any executive officer of the Company or any of its
subsidiaries.
HOW ARE DIRECTORS COMPENSATED?
BASE COMPENSATION. Directors who are also employees of the Company
receive no additional compensation for service as directors. Each non-employee
director receives an annual fee of $34,000 for service as a director, plus
$1,000 for each Board meeting attended. Each non-employee director also receives
an annual fee of $3,000 for each committee on which he or she serves, plus an
additional $3,000 annually for each committee of which he or she serves as
chair. All fees are paid quarterly. All directors are reimbursed for travel,
lodging and other expenses they incur related to attending Board and committee
meetings.
Each year, directors may elect to defer payment of their fees for that
year until termination of their service as a director. Any such election must be
made prior to that year's annual stockholder meeting and must specify one of two
payment options--lump sum or up to ten annual installments.
Deferred fees bear interest computed quarterly at the average prime rate for the
quarter.
A non-employee director who is 70 years of age or older (or, with the
approval of the Board Governance Committee, between the ages of 65 and 69) and
who has seven or more years of credited service as a director is entitled to
receive upon retirement from the Board of Directors $20,000 annually for the
remainder of his or her life, and his or her surviving spouse is entitled to
receive $10,000 annually for the remainder of his or her life following such
director's death. A non-employee director retiring at age 55 through 69 who has
three or more years of credited service is entitled to receive upon retirement
$20,000 annually for a period of time equal to his or her period of credited
service as a director and his or her surviving spouse is entitled to receive
$10,000 annually for the balance of such period if the director dies before the
end of such period.
Two non-employee directors of the Company (Mr. Redfern and Mr. Murdoch)
also serve as directors of the Company's subsidiary, Lafarge Canada, Inc. Each
receives from Lafarge Canada, Inc. an annual fee of Cdn. $14,000 for service as
a director plus Cdn. $1,000 for each board or committee meeting attended. All
fees are paid semi-annually, in addition, each is reimbursed by Lafarge Canada,
Inc. for travel, lodging and other expenses he incurs related to attending
Lafarge Canada, Inc. board and committee meetings.
OPTIONS. Each non-employee director receives during February of each
year an automatic grant of an option to purchase 1,000 shares of common stock.
For fiscal 1999 Thomas A. Buell, Marshall A. Cohen, Philippe P. Dauman, Jacques
Lefevre, Paul W. MacAvoy, Ronald D. Southern, Claudine B. Malone, Robert W.
Murdoch, Bertin F. Nadeau, John D. Redfern, Joe M. Rodgers and Michel Rose
received grants under this plan. Each option grant permits the recipient to
purchase shares at their fair market value on the date of grant, which was
$38.125 in the case of options granted in 1999.
Gerald H. Taylor automatically received a one-time grant of an option
to purchase 5,000 shares of common stock upon his election to the Company's
Board of Directors in 1999. This option permits Mr. Taylor to purchase shares at
$28.0625, their fair market value on the date of grant.
Options granted to non-employee directors vest depending upon the
director's length of service at the time of grant. Options granted to directors
who have served continuously for at least four years as of the date of grant are
fully vested. Options granted to directors who have served continuously less
than four years as of the date of grant vest 25% on such date for each year of
the director's prior continuous service through the date of grant and vest 25%
on each subsequent anniversary of a director's joining the Board.
9
<PAGE> 13
WHAT COMMITTEES HAS THE BOARD ESTABLISHED?
The Board of Directors has standing Executive, Finance, Board
Governance, Management Development and Compensation, Audit, Stock Option,
Pension, and Strategy and Development Committees.
BOARD COMMITTEE MEMBERSHIPS
<TABLE>
<CAPTION>
MANAGEMENT
BOARD DEVELOPMENT STRATEGY AND
NAME EXECUTIVE FINANCE GOVERNANCE &COMPENSATION AUDIT STOCK OPTION PENSION DEVELOPMENT
- ---- --------- ------- ---------- ------------- ----- ------------ ------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Thomas A. Buell * # * #
Marshall A. Cohen * # *
Bertrand P. Collomb * * *
Philippe P. Dauman * * * *
Bernard L. Kasriel # *
Jacques Lefevre #
Paul W. MacAvoy * * *
Claudine B. Malone * * * #
Robert W. Murdoch * *
Bertin F. Nadeau * * *
John M. Piecuch * * #
John D. Redfern * # *
Joe M. Rodgers * * *
Michel Rose *
Ronald D. Southern * * *
Gerald H. Taylor * * *
* Member
# Chairman
</TABLE>
Executive Committee. The Executive Committee has the authority and
power of the Board of Directors in the management of the business and affairs of
the Company when the Board of Directors is not in session, except as otherwise
provided by law. In practice, however, the Committee generally acts only with
respect to matters delegated to it by the entire Board of Directors. The
Executive Committee did not meet during fiscal 1999, but took action by
unanimous written consent one time during the year.
Finance Committee. The Finance Committee makes recommendations to the
Board of Directors as to various matters involving the financial affairs of the
Company. The Finance Committee met four times during fiscal 1999.
Board Governance Committee. The Board Governance Committee identifies
and presents qualified persons for election and re-election as directors of the
Company. This Committee annually reviews Board and Board committee performance,
as well as the effectiveness of the Company's governance structure and matters
related to corporate governance. The Committee also advises and makes
recommendations concerning criteria for Board membership, the number of members
of the Board of Directors and the composition and Committee structure of the
Board of Directors. The Board Governance Committee met two times during fiscal
1999.
Management Development and Compensation Committee. The Management
Development and Compensation Committee reviews the Company's executive
management and Board compensation standards and practices, and recommends
revisions and changes in compensation arrangements. The Committee also reviews
executive resources, the performance of key executives as well as organization
and succession plants. The Committee approves compensation changes for all
senior executives and it makes recommendations to the Board as to who should
serve as officers of the Company. The Management Development and Compensation
Committee met three times during fiscal 1999.
Audit Committee. This Committee recommends the appointment of
independent accountants, reviews all recommendations made to the Board of
Directors by the independent public accountants on accounting methods and
10
<PAGE> 14
internal control systems and advises the Board of Directors with respect
thereto, and reviews the Company's internal audit process as well as
transactions between the Company and related parties. The Audit Committee met
three times during fiscal 1999.
Stock Option Committee. The Stock Option Committee administers the
Company's stock option plans and has sole authority to grant options under the
Company's stock option plans. The Stock Option Committee met one time during
fiscal 1999.
Pension Committee. The Pension Committee administers the Company's
various pension plans, regularly reviewing the funding status of the plans and
performance of the managers of the assets of the plans, making changes in such
managers when it deems it appropriate. The Pension Committee met two times
during fiscal 1999.
Strategy and Development Committee. The Strategy and Development
Committee is responsible for reviewing the short-range and long-term strategic
plans of the Company. This Committee also considers various strategic issues,
major acquisitions and dispositions of assets and advises the Board of Directors
with respect thereto. The Strategy and Development Committee met one time during
fiscal 1999.
OTHER INFORMATION
The Board of Directors held four meetings in 1999. Each Board Committee
held such number of meetings as indicated in such Committee's description above.
During 1999, only Mr. Rodgers attended fewer than 75% of the aggregate of the
number of Board meetings and the meetings of the Committees on which he served.
On March 18, 1998, a stockholder derivative lawsuit was filed against
the Company's directors in the Circuit Court for Montgomery County, Maryland.
The lawsuit alleged breach of fiduciary duty, corporate waste, and gross
negligence in connection with the Company's purchase of North American
construction materials assets from Lafarge S.A., the Company's majority
stockholder (the "Redland Transaction").
The Redland Transaction, proposed to the Company in late 1997, was
evaluated by a special committee of independent directors after conducting
extensive due diligence and being advised by independent professionals retained
by the committee to assist with its evaluation, one of which, an investment
banking firm, advised the committee regarding the fairness of the price and
terms of the Redland Transaction. Based on its due diligence and the opinions of
its specially-retained advisers, the special committee recommended the Redland
Transaction for approval by the full Board of Directors of the Company. On March
16, 1998, the full Board, consisting of a majority of independent directors,
approved the Redland Transaction, which was publicly announced on March 17,
1998.
The directors advised the Company that the lawsuit was without merit and
have vigorously defended against the lawsuit. By order dated January 28, 2000,
the Court granted the directors' motion for summary judgment. The Company has
been advised that plaintiffs have appealed the Court's ruling and that the
directors intend to vigorously contest that appeal.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers, directors and holders of more than 10% of our
Common Stock to file with the Securities and Exchange Commission reports
regarding their ownership and changes in ownership of our stock. Based upon a
review of these filings and written representations from the Company's directors
and executive officers, the Company notes that Gerald H. Taylor, a director of
the Company, inadvertently failed to report an option to acquire 5,000 shares of
the Company's Common Stock within his initial report of ownership. Mr. Taylor
subsequently reported that option.
11
<PAGE> 15
EXECUTIVE COMPENSATION
The Company's executive compensation program is administered by the
Management Development and Compensation Committee of the Board of Directors and,
with respect to stock-based compensation, the Stock Option Committee of the
Board of Directors. No member of either committee is an employee of the Company.
All decisions made by the Compensation Committee relating to the compensation of
the Company's executive officers are presented to, and are available for review
by, the full Board. All decisions relating to stock options are made solely by
the Stock Option Committee.
REPORT ON EXECUTIVE COMPENSATION
The following is a report submitted by members of the Management
Development and Compensation Committee and the Stock Option Committee,
addressing the Company's compensation policy as it related to the Company's
executive officers for fiscal 1999:
The goal of the Company's executive compensation policy is to ensure
that an appropriate relationship exists between executive pay and the creation
of stockholder value, while at the same time motivating and retaining key
employees. To achieve this goal, the Company's executive compensation policies
integrate competitive levels of annual base compensation with bonuses based upon
corporate performance and individual initiatives and performance. This annual
cash compensation, together with the payment of equity-based, incentive
compensation, is designed to attract and retain qualified executives and to
ensure that such executives have a continuing stake in the long-term success of
the Company. All executive officers and certain key managers participate in the
Company's incentive compensation plans.
In 1999, the Company's executive compensation program consisted
primarily of (i) base salary adjusted from the prior year, (ii) a bonus
opportunity, based upon the performance measurements described below, and (iii)
options granted under the Company's 1998 Stock Option Plan.
Base Salary. In establishing base salaries for executive officers of
the Company, the Company participates in executive compensation surveys with
other construction materials and cement companies in the United States and
Canada, reviews market data of general industry companies of similar size, and
utilizes information provided by several independent compensation consultants.
The comparison group utilized by the Company for cash compensation matters
generally includes industrial companies with annual sales in excess of $1
billion, which employ more than 1,000 full time employees, with a unionized
labor force, and which have been profitable over the most recent two to three
year period. Individual performance among the companies included in the
comparison group is not separately evaluated.
The Company annually sets base salary targets, or midpoints, for each
of its executives, including the President and Chief Executive Officer, at
levels within the range of those persons holding comparably responsible
positions at other companies in the Company's comparison group. Such midpoints
are established based upon a point system designed to assign a value for each
executive office, taking into account the various responsibilities and duties of
the specific position. Due to the Company's long-term approach to compensation
and the cyclical nature of the Company's business, historically a greater
percentage of the annual compensation (base salary plus bonus) paid to executive
officers has been represented by the salary component. Consequently, the Company
has paid slightly higher base salaries and lower annual bonuses than other
companies in its comparison group. However, the annual cash compensation targets
for the Company's executive officers have generally been set between the median
and the 3rd quartile of the range for annual cash compensation totals in the
comparison group.
Salaries for executive officers are reviewed by the Board's Management
Development and Compensation Committee (the "Compensation Committee") in the
first quarter of each year and may be increased at that time on the basis of the
individual performance of the executive, as evaluated by senior management, the
Company's expected financial performance, and changes in competitive pay levels.
An annual overall budget of salary increases for the year is prepared, based
upon the Company's expected financial performance and taking into consideration
the expected pay increases, if any, indicated by the various industry surveys
and information from various compensation consultants. The Compensation
Committee then utilizes this budget in establishing salaries based upon
management's evaluation of each officer's performance during the prior year. In
1999, in view of the
12
<PAGE> 16
Company's long-term compensation objectives and improvements in the Company's
financial results, the budgeted salary increases were comparable to projected
salary increases for the comparison group utilized by the Company.
The base salary of $442,000 for the President and Chief Executive
Officer was established in accordance with the policies established for all
executive officers and was slightly above the midpoint of the range for persons
holding comparable positions at other companies in the comparison group. The
Chairman of the Board annually reviews the Chief Executive Officer's performance
and makes a salary recommendation which is acted upon by the Compensation
Committee. The 1999 salaries of the other executive officers of the Company
listed in the Summary Compensation Table (the "named executive officers") ranged
from approximately 98% to 114% of the midpoints established with respect to each
of such positions.
Annual Incentives. The Company has an annual bonus plan that provides
for the payment of bonuses to certain executive officers and key managers
contingent upon the achievement of certain financial targets and/or individual
objectives. The bonus plan is intended to reward the accomplishment of corporate
objectives, reflect the Company's priority on maximizing earnings, and provide a
fully competitive compensation package which will attract, reward and retain
quality individuals. Under the plan, one-half of the total bonus opportunity for
a participant is based upon the attainment of financially based Company
performance objectives and one-half of the total bonus opportunity is based upon
the achievement of individual objectives. If both the Company and individual
performance objectives are attained or surpassed, participants will be eligible
to receive maximum amounts ranging from 40% to 100% of their base salary,
depending upon their position with the Company.
Financially based performance objectives measure the Company's
performance for the year against certain return on equity and return on net
asset criteria. Subjective performance criteria are used to evaluate each
officer's individual performance with respect to the individual objectives
defined for such officer at the beginning of each year. Individual objectives
may include the performance of a specific division or product line for which an
officer is responsible, the reduction of Company or division expenses or debt,
or other specific tasks or goals, and typically include a series of
non-quantifiable objectives.
Annual incentives are paid only upon the achievement of either
financial performance objectives or individual performance objectives for the
year. Because of the Company's improved earnings performance, financial
performance bonuses were paid with respect to 1999 in amounts in the range of
32.5% to 50% of the salaries of the Chief Executive Officer and the named
executive officers. The individual performance bonuses paid to these persons
with respect to 1999 were in the range of 30% to 46% of such salaries.
Mr. Piecuch's total bonus amount was equal to approximately 96% of his
1999 salary. The Company performance objective on which a portion of such bonus
was based was the achievement by the Company of return on equity and return on
net assets targets specified by the Compensation Committee. The factors
considered by the Compensation Committee in determining the portion of the bonus
based on individual objectives included his leadership role with respect to the
Company's improved financial performance in 1999.
Long-Term Incentives. Long-term incentive awards strengthen the ability
of the Company to attract, motivate and retain executives of superior capability
and more closely align the interests of management with those of stockholders.
Long-term awards granted in 1999 consisted of non-qualified stock options
granted under the Company's 1998 Stock Option Plan. Unlike cash, the value of a
stock option will not be immediately realized and does not result in a current
expense to the Company. Stock options are granted with exercise prices equal to
the prevailing market value of the Common Stock and will have value only if the
Company's stock price increases, resulting in a commensurate benefit for the
Company's stockholders. Generally, grants may vest in equal amounts over four
years. Executives generally must be employed by the Company or an affiliate of
the Company at the time of vesting.
The Board's Stock Option Committee (the "Stock Option Committee")
considers on an annual basis the grant of options to executive officers and key
managers. The number of options granted is generally based upon the position
held by a participant and the Stock Option Committee's subjective evaluation of
such participant's contribution to the Company's future growth and
profitability. In accordance with the policy maintained by the Stock Option
Committee, the total number of options granted annually under the Company's
stock option program represents approximately 1% of the approximately 73,000,000
outstanding shares of Common Stock of the
13
<PAGE> 17
Company (including the Exchangeable Preference Shares of our subsidiary, Lafarge
Canada, Inc.). Generally, the grant of options is an annual determination, but
the Stock Option Committee may consider the size of past awards and the total
amounts outstanding in making such a determination. In 1999, the Stock Option
Committee granted to Mr. Piecuch options to purchase 40,000 shares of the
Company's Common Stock based upon the foregoing factors.
Lafarge S.A., the Company's principal stockholder, has advised the
Company that it intends to grant to certain executive officers of the Company
options to purchase shares of Lafarge S.A. common stock from time to time, in
recognition of their contributions to the overall performance of Lafarge S.A.
and its affiliated companies. Options granted by Lafarge S.A. are not considered
by the Stock Option Committee in determining the number of options to be granted
by the Company.
The Compensation Committee and the Stock Option Committee believe that
linking executive compensation to corporate performance results in a better
alignment of compensation with corporate goals and stockholder interests. As
performance goals are met or exceeded, resulting in increased value to
stockholders, executives are rewarded commensurately. The Committees believe
that compensation levels during 1999 adequately reflect the Company's
compensation goals and policies.
March 1, 2000
Management Development and Stock Option Committee
Compensation Committee
Thomas A. Buell, Chairman Thomas A. Buell, Chairman
Philippe P. Dauman Philippe P. Dauman
Claudine B. Malone Claudine B. Malone
John D. Redfern Ronald D. Southern
Ronald D. Southern
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Of the directors who constitute the Management Development and
Compensation Committee and the Stock Option Committee, only John D. Redfern has
been an officer of the Company or of our subsidiary, Lafarge Canada, Inc.. Mr.
Redfern's current and previous positions with the Company and Lafarge Canada,
Inc. are described under Item 1 - "Election of Directors."
14
<PAGE> 18
SUMMARY COMPENSATION TABLE
The following table sets forth information with respect to the Chief
Executive Officer and the other four executive officers of the Company who were
the most highly compensated for the year ended December 31, 1999 who were
serving as executive officers at year end.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------
SECURITIES
ANNUAL COMPENSATION UNDERLYING
--------------------------------------------------------- STOCK
NAME AND OTHER ANNUAL OPTIONS ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION (1) (#) COMPENSATION (2)
------------------ ---- ------ ----- ---------------- --------- ----------------
<S> <C> <C> <C> <C> <C> <C>
John M. Piecuch (3) 1999 $442,000 $425,000 40,000 $26,168
President and Chief 1998 416,500 315,775 35,000 24,148
Executive Officer of Lafarge 1997 382,500 230,648 35,000 24,316
Corp.; President and Chief
Executive Officer of LCI
Michael J. Balchunas 1999 210,000 156,250 12,000 58,758
Senior Vice President 1998 190,000 85,500 12,000 8,607
and President, U.S. 1997 177,600 78,100 10,000 8,465
Cement Operations
Edward T. Balfe 1999 375,000 300,000 27,500 30,534
Executive Vice President and 1998 323,000 210,000 25,000 27,000
President, Construction 1997 264,000 149,200 $28,483(4) 20,000 27,359
Materials
Peter H. Cooke 1999 241,666 228,750 21,000 71,638
Executive Vice President - 1998 195,489 106,508 20,000 4,360
Cement Operations 1997 190,661 99,230 20,000 5,468
Larry J. Waisanen 1999 255,000 193,800 22,500 19,719
Executive Vice President 1998 230,000 133,800 17,500 19,720
and Chief Financial 1997 195,000 86,200 12,500 19,678
Officer
</TABLE>
- ---------------
(1) Excludes perquisites and other benefits, unless the aggregate amount of
such benefits exceeded the lesser of $50,000 or 10 percent of the total
annual salary and bonus reported for the named executive officer.
(2) The amounts shown for 1999 include (a) contributions or allocations by
the Company to the executives' accounts under the Company's Thrift
Savings Plan and Thrift Savings Restoration Plan ($12,790 for Mr.
Piecuch, $12,309 for Mr. Balfe, $7,200 for Mr. Cooke, $11,536 for Mr.
Waisanen and $7,200 for Mr. Balchunas); (b) term life insurance
premiums paid by the Company ($5,645 for Mr. Piecuch, $6,225 for Mr.
Balfe, $672 for Mr. Cooke, $1,583 for Mr. Waisanen and $864 for Mr.
Balchunas); and (c) interest that would have been payable by the
executive on his interest free loan if the Company required interest to
be paid ($7,336 for Mr. Piecuch, $12,000 for Mr. Balfe, $424 for Mr.
Cooke, $6,600 for Mr. Waisanen). In addition, the amounts shown for
1999 include relocation payments made by the Company ($50,694 for Mr.
Balchunas and $63,342 for Mr. Cooke).
(3) Mr. Piecuch expends 15% of his time and effort for the benefit of
Lafarge S.A. Salary and bonus amounts reported are those attributable
to his service to the Company.
15
<PAGE> 19
(4) Represents a tax equalization payment reimbursing Mr. Balfe for taxes
which he paid to Canadian revenue authorities and related expenses as a
result of his performance of services in Canada, the amount of which
equals the difference between actual U.S. and Canadian taxes paid and
the tax he would have paid if only a U.S. tax return had been required,
plus tax return preparation fees.
OPTION EXERCISES AND YEAR-END VALUES
The following table shows information with respect to stock options
exercised during 1999 and unexercised options to purchase the Company's Common
Stock granted to the Chief Executive Officer and the other named executive
officers and held by them at December 31, 1999.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT DECEMBER 31, 1999 AT DECEMBER 31, 1999(2)
ACQUIRED VALUE ---------------------------------- ---------------------------------
NAME ON EXERCISE REALIZED (1) EXERCISABLE UNERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ------------ ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
John M. Piecuch 5,000 $57,500 103,750 86,250 $719,063 $110,000
Michael J. Balchunas -0- -0- 30,250 27,750 243,485 39,391
Edward T. Balfe -0- -0- 86,250 61,250 605,001 90,313
Peter H. Cooke -0- -0- 32,500 51,000 177,657 90,313
Larry J. Waisanen -0- -0- 18,125 44,375 90,078 51,641
</TABLE>
- ----------
(1) Market value on exercise date minus option exercise price times number
of options exercised.
(2) Market value at year end ($26.5625) of one share of the Company's
Common Stock minus option exercise price times number of options.
OPTION GRANTS
The following table shows information with respect to grants of stock
options pursuant to the Company's 1998 Stock Option Plan during 1999 to the
Chief Executive Officer and the other named executive officers. No stock
appreciation rights were granted 1999.
<TABLE>
<CAPTION>
NUMBER OPTION GRANTS IN LAST FISCAL YEAR
OF SECURITIES ----------------------------------------------------
UNDERLYING PERCENTAGE OF
OPTIONS TOTAL OPTIONS GRANT DATE
GRANTED (1) GRANTED TO EMPLOYEES EXERCISE EXPIRATION PRESENT VALUE (2)
NAME (#) IN 1999 PRICE ($/SH) DATE ($)
- ---- ------------- --------------------- ------------ ---------- ------------------
<S> <C> <C> <C> <C> <C>
John M. Piecuch 40,000 4.8% $38.125 2/8/09 $455,600
Michael J. Balchunas 12,000 1.4% 38.125 2/8/09 136,680
Edward T. Balfe 27,500 3.3% 38.125 2/8/09 313,225
Peter H. Cooke 21,000 2.5% 38.125 2/8/09 239,190
Larry J. Waisanen 22,500 2.7% 38.125 2/8/09 256,275
</TABLE>
- ----------
(1) All options expire ten years after the grant date and vest in annual
25% increments beginning one year after the grant date.
(2) In accordance with Securities and Exchange Commission rules, we have
used the Black-Scholes option pricing model to estimate the grant date
present value of the options set forth in this table. Our use of this
model should not be construed as an endorsement of its accuracy at
valuing options. All stock option valuation models, including the
Black-Scholes model, require a prediction about the future movement of
the stock price. The real value of the options in this table depends
upon actual changes in the market price of the Company's Common Stock
during the applicable period.
16
<PAGE> 20
PERFORMANCE GRAPH
The following graph compares the yearly percentage change in the
cumulative total shareholder return on the Company's Common Stock with the
cumulative total return of the Wilshire 5000 Index (a broad market equity index)
and with the cumulative total return of a group of peer companies in the
construction materials and cement industry selected by the Company for the
period of five years commencing December 31, 1994 and ended December 31, 1999.
The companies in the peer group index constructed by the Company are as follows:
St. Lawrence Cement, Inc., Texas Industries, Inc., Southdown, Inc., Vulcan
Materials Company, Centex Construction Products Inc. and USG Corp.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN (1)
AMONG LAFARGE CORPORATION, WILSHIRE 5000 INDEX AND PEER GROUP
[LINE GRAPH]
<TABLE>
<CAPTION>
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Lafarge $100.00 $107.17 $118.33 $176.70 $245.69 $171.09
Wilshire 5000 $100.00 $136.49 $165.44 $217.20 $268.11 $331.27
Peer Group(2) $100.00 $130.68 $151.09 $246.78 $347.27 $206.65
</TABLE>
(1) Assumes $100 invested on December 31, 1994 in Lafarge Corporation
Common Stock, Wilshire 5000 Index and Peer Group Index (constructed by
the Company as described above). Total return assumes reinvestment of
dividends.
(2) Includes St. Lawrence Cement, Inc. (converted to U.S. currency at a
constant rate), Texas Industries, Inc., Southdown, Inc., Vulcan
Materials Company, Centex Construction Products Inc. and USG Corp.
RETIREMENT PLANS
The Company has a trusteed noncontributory defined benefit pension plan
for salaried U.S. employees. The normal retirement age of participants is 65.
The amount of retirement income available to participants under the plan is
based upon the years of credited service (not in excess of 35) and final average
earnings, which is defined to be the average of the highest annual earnings
(which includes salary, bonus and overtime payments) for any 60 consecutive
months during the last 120 months of employment. The annual retirement income
for each year of credited service is equal to 1.50% of the final average
earnings, less 1.50% of annual primary social security benefits. A participant's
accrued benefit under the plan is fully vested on the date on which such
participant completes five years of service under the plan.
Certain U.S.-domiciled executives of the Company are participants in a
supplemental executive retirement plan (the "SERP") which supplements their
benefits under the Lafarge Corp. retirement plan. Except as described
17
<PAGE> 21
below, the SERP will not be funded in advance for payment of future benefits;
the general assets of the Company are the source of funds for the SERP. Pursuant
to the SERP, the annual retirement income for each year of credited services for
selected executives will be increased from that stated above to 1.75% of final
average earnings, less 1.5% of annual primary social security benefits. Further,
under the SERP, pension payments will be permitted in excess of the limit of
$90,000 per year (as increased annually according to U.S. Internal Revenue
Service rules) applicable under the Lafarge Corp. retirement plan. Mr. Piecuch,
Mr. Balchunas and Mr. Waisanen are participants in the SERP.
In October 1996, the Company established a trust to securitize SERP
benefits upon a change of control of the Company or of Lafarge S.A. The trust
will remain unfunded until a change in control is imminent, at which time the
trust would become irrevocable and would be funded with cash sufficient to pay
the benefits under the SERP. Also, the SERP was amended to provide that in the
event of a change of control, the eligibility for SERP benefits will be expanded
to cover SERP participants who are vested upon termination of employment but who
are not otherwise eligible for retirement under the Company's retirement plan.
The Board of Directors also adopted a resolution requiring the Company, in the
event of a change of control, to make contributions to the Company's retirement
plan to the maximum extent allowable as a current deduction for federal income
tax purposes.
The table set forth below illustrates the amount of combined annual
pension benefits payable under the Lafarge Corp. retirement plan and the SERP to
participants in specified average annual earnings and years-of-service
classifications, without taking into account offsets for primary social security
benefits.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
FIVE-YEAR ANNUAL PENSION
AVERAGE COVERED YEARS OF SERVICE AT AGE 65
ANNUAL ------------------------------------------------------------------------------
EARNINGS 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$ 50,000........................... $ 13,125 $ 17,500 $ 21,875 $ 26,250 $ 30,625
100,000........................... 26,250 35,000 43,750 52,500 61,250
150,000........................... 39,375 52,500 65,625 78,750 91,875
200,000........................... 52,500 70,000 87,500 105,000 122,500
250,000........................... 65,625 87,500 109,375 131,250 153,125
300,000........................... 78,750 105,000 131,250 157,500 183,750
350,000........................... 91,875 122,500 153,125 183,750 214,375
400,000........................... 105,000 140,000 175,000 210,000 245,000
450,000........................... 118,125 157,500 196,875 236,250 275,625
500,000........................... 131,250 175,000 218,750 262,500 306,250
550,000........................... 144,375 192,500 240,625 288,750 336,875
600,000........................... 157,500 210,000 262,500 315,000 367,500
</TABLE>
The years of service credited under the retirement plan and the SERP at
March 1, 2000 to each individual named in the compensation table above who is a
participant in the plan were as follows: Mr. Piecuch - 13 years (retirement), 22
years (SERP); Mr. Balchunas - 27 years (retirement), 27 years (SERP); and Mr.
Waisanen - 23 years (retirement), 23 years (SERP).
18
<PAGE> 22
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In 1999, Bertrand Collomb received a salary of $220,000 for serving as
Chairman of the Board of the Company; Bernard Kasriel received a salary of
$110,000 for serving as Vice Chairman of the Board; and John D. Redfern received
a fee of Cdn. $36,400 for serving as Chairman of the Board of our subsidiary,
Lafarge Canada, Inc.
INDEBTEDNESS OF MANAGEMENT
The Company and our subsidiary, Lafarge Canada, Inc. have extended
non-interest bearing loans to certain of their officers to assist in the
purchase of housing in the course of relocations. With respect to loans with an
outstanding balance in excess of $60,000 at any time during 1999, the largest
aggregate amount of such indebtedness outstanding during 1999 and the amount
thereof outstanding as of December 31, 1999, respectively, were as follows with
respect to the following individuals: Bertrand P. Collomb, Chairman of the Board
- - $67,676, $59,792; John M. Piecuch, President and Chief Executive Officer -
$101,667, $91,667; Edward T. Balfe, Executive Vice President and President
Construction Materials Group - $155,000, $145,000; Larry J. Waisanen, Executive
Vice President and Chief Financial Officer, $85,000, $80,000; James J. Nealis,
Vice President, Human Resources, $181,000, $175,000 and Eric C. Olsen, Senior
Vice President, Strategy and Development, $201,000, $200,642.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
Effective October 1, 1997, the Company entered into a three-year
consulting agreement with Robert W. Murdoch pursuant to which Mr. Murdoch is
paid $4,000 per day for consulting services, not to exceed $100,000 per contract
year or $300,000 in the aggregate during the term of the agreement. During 1999,
Mr. Murdoch was paid approximately $20,000 for consulting services pursuant to
the agreement.
The Company, our subsidiary Lafarge Canada, Inc. and our majority
stockholder Lafarge S.A. are parties to three agreements concerning the sharing
of costs for research and development, strategic planning, human resources,
communications activities, marketing and technical assistance for the gypsum
wallboard division and the use of certain trademarks. In 1999, the Company and
Lafarge Canada, Inc. recorded expenses under these agreements for the
approximate sums of $______________ and Cdn. $______________, respectively. The
Company and Lafarge Canada, Inc. have entered into agreements with Lafarge S.A.
under which Lafarge S.A. pays for certain services provided to Lafarge S.A. by
the Company and Lafarge Canada, Inc. In 1999, charges to Lafarge S.A. for these
services totaled approximately $______________.
During 1999, the Company and Lafarge Canada, Inc. purchased products
from Lafarge S.A. and certain of its affiliates in the ordinary course of
business. These purchases totaled approximately $______________ and Cdn.
$______________ for the Company and Lafarge Canada, Inc., respectively.
Messrs. Collomb, Kasriel, Lefevre, Murdoch, Piecuch and Rose are also
directors or officers of Lafarge S.A.
19
<PAGE> 23
ITEM 2 - RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
Arthur Andersen LLP audited the consolidated financial statements of
Lafarge Corporation for the fiscal year ended December 31, 1999. Upon the
recommendation of the Audit Committee, the Board of Directors has appointed
Arthur Andersen LLP as the Company's independent accounts to audit its
consolidated financial statements for the fiscal year ended December 31, 2000.
Although we are not required to seek your approval of this appointment, the
Board of Directors believes it to be sound corporate practice to do so. If the
appointment is not ratified, the Audit Committee will investigate the reasons
for your rejection and the Board will reconsider the appointment.
We expect one or more representatives of Arthur Andersen LLP to attend
the meeting, where they will be available to respond to appropriate questions.
They also will have an opportunity to make a statement if they so desire.
Our Board of Directors recommends that you vote FOR ratification of the
appointment of Arthur Andersen as Lafarge Corporation's independent accountants
for the fiscal year ended December 31, 2000.
20
<PAGE> 24
ITEM 3 - PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION
TO INCREASE AUTHORIZED COMMON STOCK
The Board of Directors believes that it is in Lafarge Corporation's
best interest to amend the Company's Articles of Incorporation to increase the
number of shares of Common Stock the Company is authorized to issue from
110,100,000 to 150,000,000.
As of January 1, 2000, approximately 68.7 million shares of the
Company's currently authorized Common Stock were issued and outstanding. Of the
remaining authorized shares, approximately 17.7 million were reserved for
issuance pursuant to the Company's stock option and purchase plans, the
Company's optional dividend reinvestment plan and upon exchange of the
Exchangeable Preference Shares of our subsidiary, Lafarge Canada, Inc., leaving
approximately 23.7 million shares available for issuance for other corporate
purposes.
The proposed amendment will provide additional authorized shares of
Common Stock for future issuance by the Company. The Board believes that the
current number of authorized shares of Common Stock are insufficient to cover
possible future issuances of shares from time to time. Increasing the number of
authorized shares will provide the Company with the flexibility to make future
issuances as may be necessary, in connection with potential acquisitions that
may present themselves or other corporate transactions that may be considered
from time to time. The proposed amendment will provide the Company with
flexibility to accomplish such transactions as they arise and to achieve other
business and financial objectives in a timely manner by avoiding potential
delays associated with seeking stockholder approval, except as may be required
by the Company's Articles or Bylaws, applicable law or the rules of any stock
exchange or other system on or through which the Company's securities may then
be listed or traded. The Board will determine the terms of any such issuance of
additional shares.
Except for our majority stockholder Lafarge S.A., who has certain
rights to purchase securities from the Company through its Option Agreement with
the Company dated November 1, 1993, all or any of the authorized shares may be
issued without first offering those shares to the Company's stockholders for
subscription. The issuance of shares otherwise than on a pro-rata basis to all
stockholders would reduce the proportionate interest in the Company of each
stockholder.
We have not proposed the increase in the authorized number of shares
with the intention of using the additional shares for anti-takeover purposes,
although we could theoretically use the additional shares to make more difficult
or to discourage an attempt to acquire control of the Company.
If this proposal is approved, the first paragraph of Article FOURTH of
the Company's Articles of Incorporation will be amended to read as follows:
FOURTH: the total number of shares of all classes of stock which the
Corporation shall have the authority to issue is 180,000,000, of which,
subject to the power of the Board of Directors to classify and
reclassify unissued shares of Common Stock as provided in the next
paragraph, (i) 30,000,000 shares of the par value of $0.0001 each are
to be of the class designated "Voting Stock," and (ii) 150,000,000
shares of the par value of $1.00 each are to be of the class designated
"Common Stock." The aggregate par value of all shares of all classes is
to be $150,003,000.
We do not have any current plans, agreements or understandings for
stock issuances which in the aggregate would involve the use of a number of
shares that exceeds the amount currently authorized but unissued.
The Board unanimously adopted a resolution setting forth the proposed
amendment to the Articles of Incorporation, declaring its advisability and
directing that the proposed amendment be submitted to the stockholders for their
consideration at the annual meeting. If approved by the stockholders, the
amendment will become effective upon filing with and acceptance for record by
the Maryland State Department of Assessments and Taxation of appropriate
articles of amendment.
Our Board of Directors recommends that you vote FOR the proposed
amendment to our Articles of Incorporation to increase our authorized common
stock.
21
<PAGE> 25
OTHER MATTERS
ARE OTHER MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING?
The Company does not expect any other matters to be presented for
consideration at the annual meeting other than those matters described within
this proxy statement. If any other matters are presented for consideration, the
persons named in the enclosed proxy intend to vote in accordance with their
judgment on each matter considered.
WHEN MUST STOCKHOLDER PROPOSALS FOR THE 2001 ANNUAL MEETING BE SUBMITTED?
The Company expects to hold the 2001 Annual Meeting during the first
week of May 2001. Stockholders interested in submitting a proposal for inclusion
in the proxy materials for the Company's 2001 annual meeting may do so by
following the procedures prescribed in SEC Rule 14a-8. To be eligible for
inclusion, stockholder proposals must be received at the Company's principal
executive office no later than November ___, 2000. In addition, under the SEC's
Rule 14-4, the persons named in the proxy for the 2001 annual meeting may vote
in their discretion with respect to any stockholder proposal that is not
submitted to the Company on or before February ___, 2000.
WHO WILL BEAR THE COST OF SOLICITING PROXIES FOR THE ANNUAL MEETING?
The Company will bear the cost of soliciting proxies for the annual
meeting. In addition to solicitation by mail, certain officers and employees of
the Company, who will receive no additional compensation for their services, may
solicit proxies in person or by telephone or telefax.
HOW DO I OBTAIN A COPY OF THE COMPANY'S FORM 10-K ANNUAL REPORT?
The Company will send the Company's Form 10-K Annual Report without
charge to any stockholder who requests a copy in writing. Please direct your
request to David C. Jones, Vice President-Legal Affairs and Secretary, Lafarge
Corporation, P.O. Box 4600, Reston, Virginia 20195.
By Order of the Board of Directors
David C. Jones
Vice President-Legal Affairs and Secretary
Reston, Virginia
March ___, 2000
22
<PAGE> 26
(FRONT OF CARD)
LAFARGE CORPORATION
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
MAY 2, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Bertrand P. Collomb, John D. Redfern and John M.
Piecuch (acting by majority or, if only one be present, by that one alone), and
each of them, proxies, with power of substitution in each, and hereby authorizes
them to represent and to vote, as designated on the reverse side, all shares of
Common Stock of Lafarge Corporation (the "Company") standing in the name of the
undersigned on March 6, 2000, at the Annual Meeting of Stockholders to be held
on May 2, 2000 in McLean, Virginia, and at any adjournment thereof.
THIS PROXY WILL BE VOTED AS SPECIFIED ON THE REVERSE SIDE. HOWEVER, IF NO VOTE
IS SPECIFIED, THIS PROXY WILL BE VOTED "FOR" EACH OF THE NOMINEES FOR DIRECTOR,
"FOR" THE PROPOSAL TO RATIFY THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS
INDEPENDENT ACCOUNTANTS, AND "FOR" THE AMENDMENT TO THE ARTICLES OF
INCORPORATION INCREASING THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK; ALL OF
WHICH MATTERS ARE MORE FULLY DESCRIBED IN THE PROXY STATEMENT OF WHICH THE
UNDERSIGNED STOCKHOLDER ACKNOWLEDGES RECEIPT.
THIS PROXY GRANTS DISCRETIONARY AUTHORITY TO VOTE IN ACCORDANCE WITH THE
BEST JUDGMENT OF THE NAMED PROXIES ON OTHER MATTERS THAT MAY COME BEFORE
THE MEETING.
- --------------------------------------------------------------------------------
PLEASE VOTE, DATE AND SIGN ON THE OTHER SIDE AND RETURN PROMPTLY IN THE
ENCLOSED ENVELOPE
- --------------------------------------------------------------------------------
This proxy should be signed exactly as your name(s) appear(s) hereon. Joint
owners should both sign. If signing as attorney, executor, guardian, or in some
other representative capacity, or as officer of a corporation, please indicate
your capacity or title.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
- ------------------------------------------ ------------------------------------------
- ------------------------------------------ ------------------------------------------
- ------------------------------------------ ------------------------------------------
(BACK OF CARD)
[x] PLEASE MARK VOTES
AS IN THIS EXAMPLE
------------------------------------- For All With For All
LAFARGE CORPORATION Nominees held except
------------------------------------- 1. Election of Directors. [ ] [ ] [ ]
The nominees are:
THOMAS A. BUELL PAUL W. MACAVOY JOE M. RODGERS
Mark box at right if an address MARSHALL A. COHEN CLAUDINE B. MALONE MICHEL ROSE
change or comment has been noted [ ] BERTRAND P. COLLOMB ROBERT W. MURDOCH RONALD D. SOUTHERN
on the reverse side of this card. PHILIPPE P. DAUMAN BERTIN F. NADEAU GERALD H. TAYLOR
BERNARD L. KASRIEL JOHN M. PIECUCH
I PLAN TO ATTEND THE MEETING. [ ] JACQUES LEVEVRE JOHN D. REDFERN
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE,
MARK THE "FOR ALL EXCEPT" BOX AND STRIKE A LINE THROUGH THE
NAME(S) OF THE NOMINEE(S) IN THE LIST PROVIDED ABOVE.
The signer hereby revokes all proxies 2. Approval of appointment of Arthur Andersen LLP For Against Abstain
heretofore given by the signer to vote as independent accountants. [ ] [ ] [ ]
at said meeting or any adjournments
thereof.
3. Approval of amendment to Articles of Incorporation For Against Abstain
increasing the number of authorized shares of [ ] [ ] [ ]
----------------------- Common Stock.
Please be sure to sign Date
and date this Proxy. ----------------------- 4. In their discretion, the Proxies are authorized to
- ---------------------------------------------------- vote on such other business as may properly come
before the meeting or any adjournment thereof.
Stockholder sign here Co-owner sign here
- ----------------------------------------------------
DETACH CARD DETACH CARD
</TABLE>
