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
Filed by the registrant /X/
Check the appropriate box:
/X/ Definitive proxy statement
The Turner Corporation
(Name of Registrant as Specified in Its Charter)
Payment of filing fee (Check the appropriate box)
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i), or 14a-6(j)(2).
THE TURNER CORPORATION
Notice of Annual Meeting of Stockholders
May 9, 1997
The Annual Meeting of Stockholders of The Turner
Corporation will be held on Friday, May 9, 1997, at 11:00
A.M. Eastern Daylight Saving Time, in the 13th Floor
Boardroom at the American Stock Exchange, 86 Trinity Place,
New York, New York, for the following purposes:
1. To elect two directors;
2. To transact such other business as may
properly come before the meeting or any adjournment.
Stockholders of record at the close of business on
March 24, 1997 will be entitled to vote at the meeting.
SARA J. GOZO
Secretary
March 31, 1997
Each stockholder's vote is important. In order to vote,
date, sign and return promptly the enclosed proxy in the
accompanying reply envelope. Stockholders who attend the
Annual Meeting may vote at the meeting even if they have
sent in a proxy.
THE TURNER CORPORATION 375 Hudson Street New York,
New York 10014 Proxy Statement ANNUAL MEETING OF STOCKHOLDERS
May 9, 1997 This Proxy
Statement is being furnished beginning March 31, 1997, in
connection with the solicitation of proxies for use at the
1997 Annual Meeting of Stockholders of The Turner
Corporation to be held at the time and place and for the
purposes set forth in the attached notice.
ELECTION OF DIRECTORS
The Company's directors who are elected by the
holders of the Common Stock (voting together with the
holders of the Company's Series B ESOP Convertible Preferred
Stock) are divided into three classes. They serve three year
terms, with the directors in one class being elected each
year.The holder (or holders) of the Company's Series C 8.5%
Convertible Preference Stock ("Series C Preferred Stock")
have the right to elect three directors, who are in addition
to the directors elected by the holders of the Common Stock
and the Series B ESOP Convertible Preferred Stock.
At the 1997 Annual Meeting two directors are to be
elected. Election of a director requires a plurality of the
votes cast. Because no minimum vote is required, shares
which are present at the meeting but are not voted (whether
due to abstentions or otherwise) will not directly affect
the outcome of the election.
The Board of Directors' nominees for the two
directorships, the directors who will continue in office and
the directors expected to be elected by the holders of the
Corporation's Series C Preferred Stock are as follows:
Served as
Director Since Term
Name and Age Principal Occupation or During Will
and Other Directorships the Period Expire
Nominees for election as directors to serve until 2000:
Walter G. Ehlers, 64 1985 2000
Retired President, Chief Operating
Officer and Trustee,Teachers
Insurance and Annuity Association
and College Retirement Equities
Fund, 1984-88; Director of Neuberger
& BermanAdvisors Management Trust;
Trustee of China Medical Board of New York, Inc.
John O. Whitney, 69 1988 2000
Professor and Executive Director,
The Deming Center forQuality Management,
Columbia Business School; Director of
Atchison Castings; Church & Dwight Co., Inc.
Directors who will continue in office:
Ellis T. Gravette, Jr., 71
1981 1999
(1)Chairman and Chief Executive
Officer, The Turner Corporation;
President, Ardath Associates, Inc.,
1986-1996;Retired Chairman of the
Board and ChiefExecutive Officer,
The Bowery Savings Bank1981-86;
Director of MidFirst Bank, SSB
Leif Lomo, 67
1992 1998
Former President, Marley Pump Company,
1994-1995 ;Retired Chairman and Chief
Executive Officer, A.B.Chance Company;
Director of Young Broadcasting Inc.
and Mercantile Bank of Boone County
Charles H. Moore, Jr., 67
1990 1999
Director of Athletics, Cornell
University; Chairman
and Chief Executive Officer,
Xpander Pak, Inc.(protective packaging);
Executive Vice President,Illinois
Tool Works, Inc., 1991-92; President and
Chief Executive Officer, Ransburg Corporation
(subsidiary of Illinois Tool Works, Inc.),
1988-92;Director of Elcotel, Inc.;
United States Olympic Committee
Harold J. Parmelee, 59
1988 1998
President, The Turner Corporation
Gordon A. Walker, 69
1984 1999
Chairman and Chief ExecutiveOfficer,
Hollinee Inc.;Former Chairman, President
and Chief Executive Officer,U.S. Industries,
Inc.; Director of Lincoln National Corporation
Frederick W. Zuckerman, 62
1984 1999
General Partner, Zuckerman ,
Firstenberg & Associates,LLC,
Investment Bankers and Financial Advisors ;
Vice President and Treasurer, IBM Corp.
1993-95, Senior Vice President and Treasurer,
RJR Nabisco, Inc., 1991-93;
Vice President and Treasurer, Chrysler
Corporation, 1981-90;Director of
The Japan Equity Fund; Meditrust; Designer
Holdings, Inc.; The Singapore Fund; NVR
Corporation;Pantone, Inc.;
Olympic Financial Ltd.; Caere Corporation.
Served as Term
Director Since Will
or During Expire
Principal Occupation the Period
Name and Age and Other Directorships
Directors expected to be elected by holders of Series C
Preferred Stock:
Heinrich Baumann-Steiner, 55
1992 1998
Chairman and Managing Director,
Karl Steiner Holding AG; Vice
Chairman and Managing Director,
Karl Steiner AG (an affiliate of
Karl Steiner Holding AG)
A. Gary Fieger, 69
1992 1998
President, Fieger International
and A. Gary Fieger Associates, Inc.;
Former President and Chief Executive
Officer, Hammerson Property Corporation
Peter K. Steiner, 51
1992 1998
Vice Chairman and Managing Director,
Karl Steiner Holding AG; Chairman
and Managing Director, KarlSteiner AG
(an affiliate of Karl Steiner Holding AG)
(1) In keeping with the Company's policy with regard to
directors who are 70 years old or older. although Mr.
Gravette
was elected for a three year term, Mr. Gravette has
committed that he will resign effective at the time of
anyAnnual Meeting
of Stockholders unless the Board of Directors requests that
he serve for the year following that Annual Meeting of
Stockholders.
Non-employee members of the Board of Directors are paid
annual fees of $21,000, plus $1,000 and travel expenses for
each meeting attended. Non-employee chairmen of committees
of the Board of Directors receive additional annual fees of
$2,100. Employee members of the Board of Directors do not
receive any directors' fees. During 1996, the Board of
Directors held twelve meetings. Each director attended at
least 75% of the meetings of the Board of Directors and of
each Committee of which he was a member.
On November 11, 1994, the Board of Directors adopted
the Directors' Retirement Plan (the "Directors Plan"). Under
the Directors Plan, each person who is a non-employee
Director will be entitled to receive, beginning on the later
of the person's seventieth birthday or the time the person
ceases to be a Director, annual benefits equal to the annual
fee paid to non-employee Directors, reduced proportionally
to the extent a Director served for less than five years. If
there is a change of control of the Corporation, all
Directors at the time of the change in control will be
presumed to serve for five years and will receive full
benefits.
The Committees of the Board of Directors include an
Executive Committee, a Compensation and Stock Option
Committee, an Audit Committee, and a Committee on Corporate
Governance (formerly the Committee on Directors' Affairs).
The members of the Executive Committee are Messrs.
Gravette (Chairman), Ehlers, Lomo, Moore, Parmelee, and
Zuckerman. The Executive Committee may exercise the
authority of the Board during the intervals between the
meetings of the Board, except in respect of certain matters
specified in the Corporation's By-Laws. The Executive
Committee met once during 1996.
The Compensation and Stock Option Committee, which is
composed of Messrs. Zuckerman (Chairman), Fieger, Lomo,
Moore, Walker and Whitney, approves the salaries of all
executive officers of The Turner Corporation (other than the
Chairman and President, whose salaries are approved by the
Board), makes or recommends awards under the Corporation's
Executive Incentive Compensation Plan and authorizes the
grant of stock options under the Corporation's stock option
plans. The Committee also reviews senior management
organizational plans. The Committee met three times in
1996.
The Audit Committee, which is composed of Messrs. Lomo
(Chairman), Ehlers, Steiner, Walker, and Whitney, recommends
the firm of independent public accountants to act as the
Corporation's independent auditors, confers with the
Corporation's independent auditors as to the scope of their
proposed audit, reviews the findings and recommendations of
the independent auditors, reviews with the Corporation's
accounting personnel the auditors' recommendations regarding
the Corporation's financial controls, procedures and
practices, and reviews the Corporation's compliance with its
operating policy statement. The Committee met three times
during 1996.
The Committee on Corporate Governance (formerly the
Nominating Committee and more recently the Committee on
Directors' Affairs), which is composed of Messrs. Moore
(Chairman), Baumann-Steiner, Ehlers, Gravette, Parmelee,
Walker and Whitney, selects and recommends nominees for
directorships to the Board. Pursuant to a resolution adopted
by the Board in 1989, the Committee, in nominating members
of the Board for reelection, will consider any material
changes which have occurred in their employment
relationships, memberships on other boards and other
circumstances affecting their availability for and
participation in board activities, and any material changes
which have occurred in the Corporation's business or
affairs. The Committee on Corporate Governance also
establishes goals and objectives for the Board of Directors
and appraisal processes for the CEO, the full Board and
individual Directors. The Committee met three times in 1996.
As of March 24, 1997, the Corporation's directors
(including nominees), its five highest compensated executive
officers (including its Chief Executive Officer) and its
directors and officers as a group, beneficially owned the
following numbers of shares of common stock of the
Corporation:
Title of Class Name of Beneficial Owner Amount and Percent of
Nature of Class(6)
Beneficial Ownership(1)
Common Stock Heinrich Baumann-Steiner 6,000 (2)
Common Stock Anthony C. Breu 11,198
Common Stock Walter G. Ehlers 26,000
Common Stock A. Gary Fieger 9,000 (3)
Common Stock Ellis T. Gravette, Jr. 14,500
Common Stock Ralph W. Johnson 23,940
Common Stock Leif Lomo 9,000
Common Stock Charles H. Moore, Jr. 7,000
Common Stock Harold J. Parmelee 69,263 1.3%
Common Stock David J. Smith 9,000
Common Stock Peter K. Steiner 1,626,500 (4) 23.7%(7)
Common Stock Gordon A. Walker 17,100
Common Stock John O. Whitney 14,000
Common Stock Frederick W. Zuckerman 7,000
Common Stock Directors and Officers as a Group
(19 persons) 1,879,926(4)(5) 26.7%(7)
__________________
(1) Includes shares issuable on exercise of currently
exercisable stock options as follows: Ellis T. Gravette,
Jr., 6,000, Harold J. Parmelee, 52,940; David J. Smith,
8,800; Ralph W. Johnson 16,640, Anthony C. Breu 9,998, all
non-employee directors, 6,000 each. Does not include
847,925 shares issuable on conversion of Series B ESOP
shares or shares issuable on exercise of options which were
not currently exercisable.
(2) Does not include 1,000,000 shares of common stock
issuable on conversion of Series C Preferred Stock, 600,000
shares of common stock issuable on conversion of Series D
Preferred Stock, which itself is issuable on conversion of
an 8.5% Debenture, or 20,500 shares of Common Stock, held by
Karl Steiner Holding AG. Heinrich Baumann-Steiner is the
Chairman of Karl Steiner Holding AG and his wife is the
beneficial owner of 50% of the shares of that company.
(3) Includes 3,000 shares owned by A. Gary Fieger
Associates, Inc., of which Mr. Fieger is the President and
sole owner.
(4) Includes 1,000,000 shares of common stock issuable on
conversion of Series C Preferred Stock, 600,000 shares of
common stock issuable on conversion of Series D Preferred
Stock, which itself is issuable on conversion of an 8.5%
Debenture, and 20,500 shares of Common Stock, held by Karl
Steiner Holding AG. Peter K. Steiner is the Vice Chairman
of Karl Steiner Holding AG and the beneficial owner of 50%
of the shares of that company.
(5) Includes 174,688 shares issuable on exercise of
currently exercisable outstanding stock options.
(6) Unless noted, less than 1%.
(7) Assumes that Karl Steiner Holding AG converts all
convertible securities held by it and that no other
convertible securities, including Series B ESOP Convertible
Preferred Stock, are converted. If the Series B ESOP
Convertible Preferred Stock were also converted, Mr.
Steiner's beneficial ownership would be
21.0%.
The following persons are known by the Corporation to have
owned beneficially more than 5% of any of the Corporation's
voting securities as of March 24, 1997
Title of Class Name and Address of Amount and Nature Percent
Beneficial Owner Of Beneficial of Class
Ownership
Common Stock The Turner Corporation 775,000 14.7%
Employees' Retirement Plan
375 Hudson Street
New York, New York 10014
Common Stock Granite Capital 380,800 7.2%(1)
East 56th Street, 25th Floor
New York City, New York 10022
Common Stock Dimensional Fund Advisors Inc 348,232 6.6%(1)
1299 Ocean Avenue
Santa Monica, California 90401
Common Stock The Records Co., A Limited 375,900 7.1%(1)
Partnership
c/o Midland Financial Co.
501 West I-44 Road
Oklahoma City, Oklahoma 73118
Series B ESOP The Turner Corporation Employee 847,925 100%(1)
Convertible Stock Ownership Plan
Preferred Stock 375 Hudson Street
New York, New York 10014
Series C Karl Steiner Holding AG 9,000 100%(2)
Preferred Stock Hagenholzstrasse 60
CH-8050 Zurich
Switzerland
(1)Information is from Schedules 13D, F,G
(2)The 9,000 shares of Series C Preferred Stock are convertible into
1,000,000 shares of Common Stock, which, based upon the
shares outstanding on March 24, 1997, would be 16.0% of the
outstanding Common Stock after conversion of all the Series
C Preferred Stock. Karl Steiner Holding AG also owned
20,500 shares of Common Stock and a Debenture which is
convertible into 6,000 shares of Series D Preferred Stock,
which, if issued, would be convertible into 600,000 shares
of Common Stock. If all the shares of Series C Stock and
Series D Stock had been converted, on March 24, 1997, Karl
Steiner Holding AG would have owned 23.6% of the outstanding
Common Stock, assuming no conversion of the Series B ESOP
Convertible Preferred Stock, and 21.0% of the outstanding
Common Stock if all of the Series B ESOP Convertible
Preferred Stock had been converted.
The shares of Series B ESOP Convertible Preferred Stock
vote together with the Common Stock on all matters,
including election of directors, with each share of Series B
ESOP Convertible Preferred Stock entitled to one vote. The
Series B ESOP Convertible Preferred Stock will constitute
13.9% of the shares entitled to vote in the election of
directors. The holders of the Series C Preferred Stock,
voting separately, are entitled to elect three directors
(declining to no directors if the outstanding Series C
Preferred Stock is less than a specified portion of the
outstanding voting stock on a fully diluted basis). While
the holders of the Series C Preferred Stock are entitled to
elect any directors, they cannot vote the Series C Preferred
Stock with regard to directors to be elected by the holders
of the Common Stock. If the holders of the Series C
Preferred Stock become no longer entitled to elect directors
as a separate class, they will be entitled to vote as part
of the same class as the Common Stock and the Series B ESOP
Convertible Preferred Stock, and will be entitled to 1,000
votes for each 9 shares of Series C Preferred Stock (a total
of 1,000,000 votes for the entire 9,000 shares). The
holders of the Series C Preferred Stock are at all times
entitled to 1,000 votes for each 9 shares of Series C
Preferred Stock with regard to all matters other than the
election of directors. Peter K. Steiner, who is a director
of the Corporation, is the Vice Chairman, and the beneficial
owner of 50% of the shares of Karl Steiner Holding AG.
Esther Baumann-Steiner, who is the sister of Peter K.
Steiner and the wife of Heinrich Baumann-Steiner, is the
beneficial owner of the other 50% of the shares of Karl
Steiner Holding AG. Mr. Baumann-Steiner, who is a director
of the Corporation, is the Chairman of Karl Steiner Holding
AG.
Karl Steiner Holding AG acquired the 9,000 shares of
Series C Preferred Stock from the Corporation in July 1992
for $9 million. At the same time, it acquired 6,000 shares
of Series D Preferred Stock from the Corporation for $6
million. Shortly after that it exercised a contractual
right to exchange the Series D Preferred Stock for an 8 1/2%
Debenture of the Corporation in the principal amount of $6
million. In connection with those transactions, Karl
Steiner Holding AG and the Corporation executed an agreement
which gives each of them options under certain circumstances
to purchase or sell Preferred Stock or Common Stock from or
to the other of them.
Karl Steiner Holding AG and the Corporation each owns
50% of Turner Steiner International S.A. ("TSI"), an entity
they formed to engage in construction-related activities in
most of the world, other than North and Central America,
Switzerland, Germany, France, Austria and Japan. During
1996, the Corporation made employees and space available to
TSI (for which the Corporation was paid $150,000 plus
reimbursement for out-of-pocket expenses), the Corporation
guaranteed obligations of TSI with regard to a construction
contract, letters of credit and a line of credit, and the
Corporation from time to time made working capital loans to
TSI (at December 31, 1996, the outstanding balance of these
loans, including the balance from prior years and accrued
interest, was $6,490,486). These guarantees and loans were
matched by Karl Steiner Holding AG.
Ellis T. Gravette, Jr. is a director of MidFirst Bank,
SSB, the lender of a $5 million secured term loan to Turner
Development Corporation, a subsidiary of the Corporation.
.
A. Gary Fieger owns 35%, and the Corporation owns 30%,
of a limited liability company which is engaged in building
diagnostics.
Section 16(a) Beneficial Ownership Reporting Compliance
A. Gary Fieger, a Director of the Corporation, was 146 and
85 days late respectively, in filing a Form 5 (Amended) with
the Securities and Exchange Commission regarding two
purchases of 1,000 shares each on September 16, 1996 and
November 19, 1996, and 54 days late in filing a Form 5
(Amended) with the Securities and Exchange Commission
regarding the purchase of 400 shares and 600 shares on
December 16, 1996 and December 17, 1996 respectively. These
shares were purchased in the name of A. Gary Fieger
Associates, Inc., of which Mr. Fieger is President and sole
owner.
Leif Lomo, a Director of the Corporation, was 12 days late
in filing a Form 4 with the Securities and
Exchange Commission regarding a purchase of 2,000 shares on
October 29, 1996.
REMUNERATION OF EXECUTIVE OFFICERS
The following table sets forth the annual compensation,
long-term compensation and all other compensation during
each of the three years ended December 31, 1996, for the
Corporation's chief executive officers and for the four
additional most highly compensated executive officers for
the year ended December 31, 1996.
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
Awards Payouts
Securities
Other Restricted Underlying
Annual Stock Options/ LTIP All Other
Name and Salary Bonus Compen- Award(s) SARs(1) Payouts Compen-
Principal Year ($)(2) ($) sation ($)(3) # sation
Position ($) ($) ($)(4)
Ellis T.
Gravette, 1996 259,091 0 NONE 0 1,000 NONE 0(6)
Jr.(5)
Chairman and
Chief Executive Officer
Harold J.
Parmelee 1996 367,700 0 NONE 1,931 3,000 NONE 55,339(6)
President 1995 343,950 0 1,832 3,000 65,718
1994 322,500 50,000 1,481 3,000 44,377
David J.
Smith 1996 219,592 0 NONE 697 1,500 NONE 16,904(6)
Senior Vice1995 205,825 0 722 1,500 26,435
President,
Chief 1994 190,000 25,000 747 1,800 0
Adminis-
trative
Officer and
Assistant Secretary
Ralph W.
Johnson 1996 211,500 0 NONE 1,682 1,500 NONE 31,623(6)
Senior Vice1995 202,375 0 1,605 1,500 34,640
President 1994 184,000 23,000 1,341 1,500 26,359
Anthony C.
Breu 1996 149,150 0 NONE 1,393 800 NONE 16,988(6)
Vice Pres-
ident 1995 142,800 0 1,354 800 18,372
and Assis-
tant to 1994 131,000 15,000 1,059 800 14,286
the
Chairman
Alfred T.
McNeill(7) 1996 288,333 0 $137,500 1,931 3,000 NONE 2,133,413(7)
Former
Chairman 1995 437,700 0 1,481 3,000 86,462
and Chief 1994 410,000 75,000 1,908 3,000 55,806
Executive Officer
________________
(1) The Corporation has
not granted any stock appreciation rights
(2) Until 1995, the annual salaries of all staff employees,
other than officers, included a holiday supplement
equal to 1/2 month's pay. Effective in 1995, officers also
received this automatic addition to their annual pay
(3) Restricted Stock Awards consist of allocations under
the Employee Stock Ownership Plan ("ESOP"). The
aggregate number allocated, as of December 31, 1996, to
Messrs. Parmelee, Smith, Johnson, Breu and McNeill was
756, 120, 628, 483 and 756 shares respectively, valued
at$14,371, $2,274, $11,926, $9,175 and $14,371
respectively. Dividends are used to pay the ESOP loan.
Mr. Gravette was not eligible toparticipate in the ESOP.
(4) Consists of matching contributions by the Corporation
to its 401(k) plan, contributions to the Corporation's
defined benefit plan / the Employees' Cash Balance
Retirement Plan and supplemental payments to retirement
accounts.
(5) Mr. Gravette was employed by the Corporation
effective August 9, 1996.
(6) Estimated
(7) Mr. McNeill resigned his position with the Corporation
effective August 9, 1996. Other Annual Compensation
consists of $137,500 paid to Mr.McNeill in connection with
his resignation. All Other Compensation includes
payments to Mr. McNeill shortly after his resignation of
$478,280 with regard to the Corporation's Supplemental
Executive Retirement Plans, $71,063 for cancelling stock
options, $912,500 for an agreement not to solicit or hire
employees of the Company or to disparage the Company, up
to $3,000 as reimbursement for financial planning expenses
and up to $60,000 as reimbursement for legal expenses.
At the time of Mr. McNeill's resignation, the Company
retained him as a consultant for five years at a fee of
$250,000 per year, purchased an apartment in New York
City from Mr. McNeill for $650,000, transferred to
Mr.McNeill a car valued at $21,570 and agreed to provide
medical benefits and life insurance to Mr. McNeill untill
2001.
The following table sets forth certain information with
regard to options granted during the fiscal year ended
December 31, 1996 and potential realizable values. No stock
appreciation rights (SARs) were granted during that year.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Number of Percent of Total Potential
Securities Options/SARs Exercise Realizable Value
Underlying Granted to or Base at Assumed Annual
Options/SARs Employees Price Expiration Rates of Stock Price
Granted(#) in Fiscal Year ($/sh) Date Appreciation For Option
Name Term (5%) (10%)
Ellis T.
Gravette, Jr.(1) 1,000 (1) 11.3100 7/01/06 $18,423 $29,335
Harold J. Parmelee3,000 3.60% $8.6875 3/08/06 $42,453 $67,599
David J. Smith 1,500 1.80% $8.6875 3/08/06 $21,227 $33,800
Ralph W. Johnson 1,500 1.80% $8.6875 3/08/06 $21,227 $33,800
Anthony C. Breu 800 .96% $8.6875 3/08/06 $11,609 $18,026
Alfred T.
McNeill (2) 3,000 3.60% $8.6875 (2) (2) (2)
The following table sets forth certain information with
regard to exercises of options during 1996 and options held
at December 31, 1996.
note!! footnotes for this table are the last row of the
table!!
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-ENd OPTION/SAR VALUES
Number of Securities Underlying
Unexercised Value of Unexercised
Options/SARs at in-the-Money
Fiscal Year-End(3) Options/SARs
Shares Acquired Value (#) at Fiscal Year-End(4)($)
Acquired on Realized Exercisable(E)/ Exercisable(E)/
Exercise Unexercisable( U) Unexercisable( U)
Name
Ellis T.
Gravette, Jr 0 0 6,000 (E) $5,563 (E)
0 (U) 0 (U)
Harold J.
Parmelee 0 0 49,940 (E) $49,117 (E)
3,000 (U) 4,688 (U)
David J. Smith 0 0 7,300 (E) $17,559 (E)
1,500 (U) 2,344 (U)
Ralph W.
Johnson 0 0 15,140 (E) $13,362 (E)
1,500 (U) 2,344 (U)
Anthony C.
Breu 0 0 9,198 (E) $7,100 (E)
800 (U) 1,250 (U)
Alfred T.
McNeill (2) 0 0 0 (E) 0 (E)
0 (U) 0 (U)
(1) Mr. Gravette was granted an option for 1,000
shares on July 1, 1996 while he was a non-employee director.
(2) When Mr. McNeill resigned his position with the
Company, he received $71,063 for cancelling options to
purchase 30,000 shares of common stock.
(3) The Corporation has not granted any SARs
(4) Includes only those options whose exercise prices are
lower than the closing price of $10.25 on December 31,
1996.
The Corporation or its subsidiaries have entered into
change of control agreements with a
number of their executive officers, including the executive
officers named above. These agreements expire on November
25, 1997. They provide that in the event of "termination"
(as defined) of an executive's employment after a "change of
control" (as defined) of the Corporation, the executive will
be entitled to receive a lump sum payment equal to 2.99
years' (in the case of nine senior executives, including Mr.
Gravette) or one year's (in the case of other executives)
compensation, including average bonus, as well as continued
eligibility for certain employee welfare benefits.
Retirement Plans
Until March 31, 1991, the Corporation had an Employees'
Retirement Plan (the "Retirement Plan"), a Supplemental
Executive Defined Benefit Retirement Plan, and a Defined
Benefit Retirement Equalization Plan under which an employee
would receive retirement benefits under a formula based upon
years of service, salary during the years preceding
retirement and the Social Security wage base. Effective
March 31, 1991, the Corporation curtailed these Retirement
Plans, so that no years of service or salary past that date
would be considered in determining retirement benefits. This
froze the benefits employees who continued working for the
Corporation past March 31, 1991 will receive under these
Retirement Plans. The annual benefits Messrs. Parmelee,
Johnson and Breu will receive under the Retirement Plan, the
Supplemental Executive Defined Benefit Retirement Plan and
the Defined Benefit Retirement Equalization Plan, assuming
retirements at age 65, will be $131,730, $85,594, and
$23,126 respectively. Mr. Gravette and Mr. Smith were
employed after March 31, 1991.
Effective April 1, 1991, the Corporation instituted a
new defined contribution plan, the Employee's Retirement
Income Plan (the "Income Plan") to replace the Retirement
Plan. Effective December 31, 1993, the Corporation froze the
benefits under the Income Plan. There will be no further
contributions to the Income Plan. The lump sum benefits (as
of January 31, 1995), that Messrs. Parmelee, Johnson and
Breu had accrued under the Income Plan were $51,986, $50,582
and $22,165, respectively. Mr. Gravette and Mr. Smith were
not eligible for the Income Plan. The Income Plan benefits
were transferred to the Tax Deferred Savings Plan, 401(k),
as of February 1, 1995.
The Income Plan lump sum benefits (shown above) do not
include the non-qualified Supplemental Plan benefits
associated with the Income Plan which are to date for Mr.
Parmelee and Mr. Johnson $62,317 and $ 8,447 respectively.
Effective January 1, 1994, the Corporation introduced
the Employees' Cash Balance Retirement Plan (the "Cash
Balance Plan"), a defined benefit plan, to replace the
Income Plan. Amounts contributed to the Cash Balance Plan
during 1996 for the Chief Executive Officer and the other
four executive officers who comprise the five highest
compensated executive officers of the
Corporation, are included in the column captioned "All Other
Compensation" in the Summary Compensation Table. The
estimated lump sum benefits Messrs. Parmelee, Smith,
Johnson, and Breu will receive under the Cash Balance Plan,
assuming no change in their current salary levels, a fixed
rate of return of 4.5% and retirement at age 65, will be:
$462,353, $191,328, $254,166 and $466,146 respectively. Mr.
Gravette is not yet eligible to participate in the Cash
Balance Plan.
COMPENSATION COMMITTEE REPORT
To the Shareholders of The Turner Corporation
The purpose of this report is to describe the
compensation policies applied by the Compensation Committee
of the Board of Directors of The Turner Corporation with
regard to the Corporation's executive officers and the basis
for the compensation of Ellis T. Gravette, Jr., the Chief
Executive Officer of the Corporation, for the year ended
December 31, 1996.
In 1989, the Compensation Committee and the management
of the Corporation undertook a review of the Corporation's
policies for compensating its senior executives. With the
approval of the Compensation Committee, the Corporation
hired Towers Perrin to assist in this review.
Representatives of Towers Perrin worked with management to
develop possible compensation programs, and then met
privately with the Compensation Committee to discuss them.
As a result of the review, the Compensation Committee
recommended, and the Board of Directors adopted, a four
pronged compensation program, designed to reward senior
executives for both long term and short term achievements on
behalf of the Corporation and its stockholders.
Subsequently, one of the four prongs, the Stockholder Gain
Award, terminated. Accordingly there are now three elements
to the compensation program for senior executives, which
are:
Base Salary the fundamental compensation to a
senior executive for fulfilling his or her job
responsibilities.
Executive Incentive Compensation Plan a reward
for achieving or exceeding corporate and individual goals
established with regard to each senior executive at the
beginning of each year.
Stock Options stock options enable key employees
to profit from increases in the price of the Corporation's
stock. The Corporation has had stock option plans since its
shares first were sold to the public in 1969. However, in
connection with the 1989 review, it was decided that stock
options would be awarded uniformly to all officers of the
Corporation and its subsidiaries holding similar positions.
In June 1996, when the The Stockholder Gain Award Plan
terminated, the Compensation Committee asked management to
provide its view on whether the plan was effective and to
provide possible alternative criteria for stock awards.
Because of a change in the Company's Chief Executive Officer
in August 1996, this has not yet been done.
Each year the Compensation Committee reviews
recommendations from management as to base salaries of
senior executives (other than the Chief Executive Officer
and the President), total awards to senior executives under
the Employee Incentive Compensation Plan and numbers of
stock options to be awarded to executives in particular
positions. It then makes recommendations to the entire
Board as to the following year's salaries of the Chief
Executive Officer and of the President, the total amount (as
a percentage of the Corporation's earnings) to be awarded
under the Executive Incentive Compensation Plan and the
portions of that total amount to be allocated to the Chief
Executive Officer and the President. In addition, it
determines, without action of the Board, the following
year's salaries of senior executives other than the Chief
Executive Officer and the President, and the portion of the
total amount awarded under the Executive Incentive
Compensation Plan (the "EIC Plan") to be allocated to each
of those senior executives.
In March 1996, the Compensation Committee reviewed
with management the policies regarding compensation of
senior executives. It discussed possible types of bonuses
for executives who had rendered outstanding service, but
ultimately left it to management to determine the form these
bonuses would take. It approved promotions recommended by
management and management's recommendations regarding stock
options. It also approved management's recommendations
regarding 1996 salaries for senior executives. In doing
this, the Compensation Committee reaffirmed that management
is principally responsible for compensation decisions,
except with regard to the Chief Executive Officer and the
President. Consistent with this, it authorized management to
make any changes it deemed appropriate in salaries which had
not been presented to the Compensation Committee. The
Compensation Committee expressed general approval of the
fact that recommended salary increases were based on
individuals' performance, not solely on the positions held
by them.
The Compensation Committee reviewed and approved a
revised form of Change of Control Agreement to be entered
into with senior executives when the then current agreements
expired in June 1996. It recommended that a provision be
added requiring the Company to provide letters of credit
promptly after a change in control to assure senior
executives they would receive the payments called for in the
Change of Control Agreements without having to resort to
litigation.
In its discussion of salaries for the Chief
Executive Officer and the President, the Compensation
Committee noted a request of the then Chief Executive
Officer that the difference between his salary and that of
the President be reduced or eliminated. The Compensation
Committee decided that the Chief Executive Officer should
receive a higher salary than the President in recognition of
the additional responsibility the Board of Directors places
on the Chief Executive Officer. With regard to 1996, the
Compensation Committee discussed the fact that neither the
then Chief Executive Officer nor the President had received
salary increases in 1995. Its members agreed that the loss
of a contract appeal relating to a project which was
completed in 1987 was not relevant to the compensation of
the Chief Executive Officer or the President, even though it
significantly affected 1995 earnings. However, the
Compensation Committee felt the Chief Executive Officer and
the President had to take some responsibility for losses on
a project in Minneapolis which also negatively affected 1995
earnings. On the other hand, it was noted that the then
Chief Executive Officer had guided the Company through a
very difficult period, that both the restructuring
undertaken in 1993 and 1994 and the cash management program
undertaken in 1995 had resulted in major benefits to the
Company and that the negative impact of the real estate
acquired in the early 1980's had essentially been
eliminated. Based upon all those factors, the Compensation
Committee recommended that the 1996 salary of the Chief
Executive Officer be increased to $440,000 (a $20,000
increase) and that the 1996 salary of the President be
increased to $360,000 (a $30,000 increase). It noted this
would result in at least some reduction of the differential
between the two salaries.
On August 9th, Alfred T. McNeill resigned his
position as Chief Executive Officer of the Corporation. The
Company provided Mr. McNeill a severance package whose terms
were negotiated. The Board appointed an interim Chief
Executive Officer and at that time the Compensation
Committee recommended that the salary of the interim Chief
Executive Officer be at the same rate as that which was
being paid to Mr. McNeill. Subsequently, at the full Board
meeting 10 days later, it was decided that the new Chief
Executive Officer's salary should be increased to make it
more commensurate with salaries of chief executive officers
of other comparably sized companies and in consideration of
the need for him to relocate to New York, his salary was
fixed at $600,000 per year.
In September of 1996, there was a restructuring
of several of the management positions as part of a program
instituted by the new Chief Executive Officer. The Company,
consistent with the authority granted to it by the
Compensation Committee, granted increases to several
officers in recognition of their new duties and
responsibilities.
.
FREDERICK W. ZUCKERMAN
A. GARY FIEGER (as of 8/9/96)
LEIF LOMO (as of 6/14/96)
CHARLES H. MOORE, Jr.
GORDON A. WALKER
ELLIS T. GRAVETTE, Jr. (until 8/9/96)
JOHN O. WHITNEY
The Turner Corporation
Comparison of Five-Year Cumulative Return
Turner vs. AMEX and Construction Peer Group
Year Turner Amex Construction Peer Group
1991 100 100 100
1992 116 100 99
1993 126 121 97
1994 110 132 104
1995 134 139 117
1996 164 148 109
Companies in Peer Groups weighted by market capitalization:
indexed to 100 at December 31, 1991. Dividends reinvested
over period. The Turner Corporation has one active
business segment: Construction. The Construction Peer Group
is made up of companies with market capitalizations of not
more than $500 million who are engaged primarily in
providing construction/engineering services for business
sectors other than home building and infrastructure: Guy F.
Atkinson of California, Michael Baker Corp., Perini Corp.,
and Stone & Webster Inc. The Construction Peer Group has
dropped CRSS Inc., which no longer meets the group
criteria.
Until 1996, the chart included a Real Estate Peer
Group. Since the Company has substantially reduced its real
estate holdings over the past five years and its real estate
holdings no longer have significant impact on the Company's
earnings, the Company decided it would no longer be relevant
to compare the Company to a Real Estate Peer Group.
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP was appointed by the Board of
Directors, with the recommendation of the Audit Committee,
as independent public accountants to audit the accounts of
the Corporation and its subsidiaries for 1996. A
representative of Arthur Andersen LLP is expected to be
present at the annual meeting and will have an opportunity
to make a statement if he or she desires to do so. That
person will be available to answer appropriate questions.
Arthur Andersen LLP rendered the following services to
the Corporation in 1996: reading of unaudited quarterly
financial information, assistance and consultation in
connection with filings with the Securities and Exchange
Commission and with various other governmental and
regulatory agencies, consultation in connection with various
tax and audit-related accounting matters, contract audit and
tax services.
GENERAL
The enclosed proxy is solicited by the Board of
Directors of The Turner Corporation to be voted at the 1997
Annual Meeting of Stockholders. All shares represented by
proxies delivered prior to the meeting will be voted in the
manner specified on the proxies. If no vote is specified,
and the proxy does not show that the stockholder wants to
abstain or that for any other reason the shares are not to
be voted, proxies will be voted for the nominees for
directorships named above. Any stockholder who signs and
returns a proxy may revoke it at any time prior to the vote
by notifying the Secretary in writing. A vote in person at
the meeting will revoke a proxy as to the matters voted
upon. However, the presence of a stockholder at the meeting
will not revoke a proxy as to matters on which the
stockholder does not vote in person.
The Board of Directors has no reason to believe that
any nominee for a directorship will be unable to serve if
elected. If any nominee should become unable to serve,
proxies may be voted for the election of another person
designated by the Board of Directors.
The Board of Directors knows of no other matters which
may be presented for stockholder action at the meeting. If
other matters do properly come before the meeting, the
persons named in the proxies will have authority to vote in
accordance with their judgment.
Stockholders of record at the close of business on
March 24, 1997 will be entitled to vote at the meeting. At
the close of business on March 24, 1997, the Corporation had
outstanding 5,261,307 shares of Common Stock and 847,925
shares of Series B ESOP Convertible Preferred Stock. The
Common Stock and the Series B Stock are voted as a single
class. Each share of Common Stock and each share of Series
B Stock outstanding on March 24, 1997 is entitled to one
vote.
In addition to the distribution of proxy material by
mail, directors, officers and employees of the Corporation
and its subsidiaries may solicit proxies by telephone or in
person. The cost of all such solicitations will be borne by
the Corporation. The Corporation will reimburse brokerage
houses, custodians, nominees and fiduciaries for expenses in
forwarding solicitation material to beneficial owners. The
Corporation has retained D. F. King & Co. to assist in the
solicitation of proxies. The fee of that firm is estimated
not to exceed $9,000 plus out-of-pocket costs and expenses.
AS PER ATTY REQUEST - THIS SECTION WITH BLOCK PROTECT ON SO
TO KEEP PRINT ON THE SAME PAGE. (BUT DO NOT INSERT HARD PAGE
CODE !!!!) NEXT ANNUAL MEETING
Proposals of security holders intended to be presented
at the 1998 annual meeting must be received by The Turner
Corporation by December 2, 1997 for inclusion in the proxy
statement and form of proxy relating to that meeting.
By Order of the Board of Directors
THE TURNER CORPORATION
SARA J. GOZO
Secretary
March 31, 1997
THE COMPANY'S ANNUAL REPORT TO STOCKHOLDERS INCLUDES A COPY
OF ITS ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 1996 WHICH WAS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION, INCLUDING FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULES. ANYONE ENTITLED TO VOTE AT
THE MEETING WHO DID NOT RECEIVE A COPY OF THE ANNUAL REPORT
TO STOCKHOLDERS MAY OBTAIN A COPY WITHOUT COST BY REQUESTING
IT FROM THE SECRETARY OF THE COMPANY AT THE ADDRESS
SPECIFIED ON THE FIRST PAGE OF THIS PROXY STATEMENT.
/x/
Please mark your
votes as in this
example.
5184
If not otherwise specified, this Direction will be voted for
the election of the nominees named below.
The Board of Directors recommends a vote FOR the below
matters.
1. Election of Directors.
FOR withheld
/ / / /
To withhold authority to vote for an individual nominee,
list that nominee+s name on the line below:
(Nominees: Walter G. Ehlers, John O. Whitney)
2. In their discretion upon any other matter that may
properly come before the meeting.
Do you plan to attend the Annual Meeting?
YES NO
/ / / /
these voting instructions are solicited
by the trustee of
the employee stock ownership plan
Please sign exactly as name appears at the left.
SIGNATURE(S) DATE
Detach Voting Instructions Card Here
Annual Meeting
of
The Turner Corporation
Stockholders
Friday, May 9, 1997
11:00 a.m.
TheAmerican Stock Exchange
13th Floor Boardroom
86 Trinity Place
New York, NY 10006
AGENDA
Election of three directors
Report on the progress of the corporation
Discussion on matters of current interest
There will be no reception following the above stated
agenda.
It is important that your shares are represented at this
meeting, whether or not you attend the meeting in person. To
make sure your shares are represented, we urge you to
complete and mail the voting instructions card above.
THE TURNER CORPORATION
Voting Instructions Solicited on Behalf of the Board of
Directors of the Company for the Annual Meeting of
Stockholders, May 9, 1997
To the Trustees - Employee Stock Ownership Plan of The
Turner Corporation
The undersigned hereby directs State Street Bank and Trust
Company, Trustee, to vote as stated herein all shares
allocated to the account of the undersigned at the Annual
Meeting of Stockholders to be held on May9, 1997 at 11:00
A.M. Eastern Daylight Saving Time, and at any adjournments
thereof, upon the matters set forth in the notice of such
meeting. The Trustee shall vote as checked upon the
following matters, more fully set forth in the Proxy
Statement, and otherwise in their discretion.
1. Election of Directors, Nominees:
Walter G. Ehlers, John O. Whitney
You are encouraged to specify your choices by marking the
appropriate boxes, SEE REVERSE SIDE, but you need not mark
any boxes if you wish to vote in accordance with the Board
of Directors+ recommendations. Your instructions cannot be
accepted unless you sign and return this card.
SEE REVERSE SIDE
/ /
Detach Voting Instructions Card Here
ANNUAL MEETING OF STOCKHOLDERS
MAY 9, 1997, 11: 00 A.M.
American Stock Exchange
13th Floor Boardroom
86 Trinity Place
New York, NY 10006
/x/
____________________________________________________________
_________________________
Please mark your
votes as in this
example.
0108
If not otherwise specified, this proxy will be voted for the
election of the nominees named below.
The Board of Directors recommends a vote FOR the below
matters.
1. Election of Directors.
FOR withheld
/ / / /
To withhold authority to vote for an individual nominee,
list that nominee+s name on the line below:
(Nominees: Walter G. Ehlers, John O. Whitney)
2. In their discretion upon any other matter that may
properly come before the meeting.
Do you plan
to attend the Annual Meeting?
YES NO
/ / / /
THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
Please sign exactly as name appears at the left. Joint
owners should each sign. When signing as attorney,
executor, administrator, trustee or guardian, please give
full title as such.
SIGNATURE(S) DATE
Detach Proxy Card Here
Annual Meeting
of
The Turner Corporation
Stockholders
Friday, May 9, 1997
11:00 a.m.
TheAmerican Stock Exchange
13th Floor Boardroom
86 Trinity Place
New York, NY 10006
AGENDA
Election of two directors
Report on the progress of the corporation
Discussion on matters of current interest
There will be no reception following the above
stated agenda
It is important that your shares are represented at this
meeting, whether or not you attend the meeting in person. To
make sure your shares are represented, we urge you to
complete and mail the proxy card above.
P
R
O
X
Y
PROXY
THE TURNER CORPORATION
Annual Meeting of Stockholders, May9, 1997
The undersigned hereby appoints Ellis T. Gravette, Jr. and
Sara J. Gozo and each of them, with full power of
substitution, as attorneys and proxies for the undersigned
to appear at the Annual Meeting of Stockholders of The
Turner Corporation to be held on May 9, 1997 at 11:00 A.M.
Eastern Daylight Saving Time, and at any adjournments of
that meeting, and at that meeting to act for the undersigned
and vote all shares of common stock of The Turner
Corporation held in the name of the undersigned, with all
the powers the undersigned would have if personally present
as follows:
You are encouraged to specify your choices by marking the
appropriate boxes, SEE REVERSE SIDE, but you need not mark
any boxes if you wish to vote in accordance with the Board
of Directors+ recommendations. The Proxies cannot vote your
shares unless you sign and return this card.
SEE REVERSE
SIDE
/ /
Detach Proxy Card Here
Annual Meeting of Stockholders
May 9, 1997, 11:00 a.m.
American Stock Exchange
13th Floor Boardroom
86 Trinity Place
New York, NY 10006
March 31 , 1997
To Participants in the Employee Stock Ownership Plan:
As a participant in The Turner Corporation Employee Stock
Ownership Plan, you have the right to direct the Trustee of
the Plan, State Street Bank and Trust Company, as to the
manner in which to vote your shares at the Company's Annual
Stockholders Meeting on May 10, 1996. The instructions
given by you will be held by the Trustee in strict
confidence.
The enclosed Voting Instruction Card can be used to provide
your instructions to the Trustee. This Card only covers the
shares held in the Employee Stock Ownership Plan for which
you are entitled to give direction and is not linked to any
other shares of Company stock or related Proxy Cards
concerning the Annual Meeting which you may receive.
Your voting direction will apply to those shares allocated
to your account as well as to a proportionate number of the
shares in the plan not yet allocated to any participant. If
you own Turner Corporation Stock outside of the Employee
Stock Ownership Plan, you will receive proxy materials
covering these shares in a separate mailing.
Also enclosed is a Proxy Statement that explains the
items which will be voted on at the Company's Annual
Stockholders Meeting. Please return your completed and
signed Voting Instruction Card as quickly as possible, using
the envelope provided. Your vote is important and you are
encouraged to take advantage of this opportunity to direct
the voting of your shares.
Sara J.Gozo
Secretary
April 18, 1997
Dear Stockholder:
Our records indicate that we have not yet received your
proxy for the Annual Meeting to be held on May 9, 1997. A
proxy card was mailed to you on
March 31, 1997, together with a Notice of Annual Meeting,
Proxy Statement and Annual Report.
We believe it is important that your views be represented at
the meeting. We are, therefore, enclosing a duplicate proxy
and urge you to sign, date and return it today in the
enclosed return envelope.
If you have already forwarded your proxy card, we thank you
for your cooperation.
Yours very truly,
Sara J. Gozo
Secretary
SJG:dtl
