Perini Corporation
73 Mt. Wayte Avenue
Framingham, Massachusetts 01701
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 25, 2000
TO THE STOCKHOLDERS OF PERINI CORPORATION:
NOTICE IS HEREBY GIVEN that the annual meeting of the stockholders of
PERINI CORPORATION will be held at the Crowne Plaza, Hawthorne Ballroom, 1360
Worcester Road (Route 9 East), Natick, Massachusetts, on Thursday, May 25, 2000,
at 9:00 a.m., for the following purposes:
1. Holders of Common Stock, $1.00 par value, of the Company (the "Common
Stock") will:
A. Elect three (3) Class I Directors, to hold office for a three-year
term, expiring in 2003 and until their successors are chosen and
qualified;
B. Consider and approve the Special Equity Incentive Plan as described in
the attached Proxy Statement;
C. Consider and ratify the selection of Arthur Andersen LLP, independent
public accountants, as auditors for the fiscal year ending December
31, 2000; and
D. Transact such other business as may properly come before the meeting
or any adjournment or adjournments thereof.
2. Holders of the Company's $21.25 Convertible Exchangeable Preferred Stock
(the "Preferred Stock") will:
A. Elect two (2) Preferred Directors, to hold office until the earlier of
(i) a one-year term, expiring in 2001 and until their successors are
chosen and qualified or (ii) until all dividends in arrears on the
Preferred Stock have been paid or declared and funds therefor set
apart for payment.
The Board of Directors has fixed the close of business on April 3, 2000, as
the record date for the determination of the stockholders entitled to vote at
the meeting.
A WHITE form of proxy is being solicited from holders of the Common Stock.
A BLUE Instruction Card is being solicited from holders of the Preferred Stock.
Whether or not you plan to attend the meeting, please fill in, sign, date and
return the enclosed WHITE proxy card or BLUE Instruction Card in the enclosed
envelope, which requires no postage if mailed in the United States. It is
important that these cards be returned. If you receive more than one card
because your shares are registered in different names, or because you own both
Common Stock and Preferred Stock, please execute each such card and return it
promptly to assure that all your shares will be voted.
By order of the Board of Directors,
April 19, 2000 Dennis M. Ryan, Secretary
The Annual Report of the Company, including financial statements for the
year 1999, is being sent to stockholders concurrently with this Notice.
<PAGE>
Perini Corporation
73 Mt. Wayte Avenue
Framingham, Massachusetts 01701
PROXY STATEMENT
ANNUAL MEETING OF THE STOCKHOLDERS
OF PERINI CORPORATION
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors of PERINI CORPORATION (hereinafter called the
"Company") to be used at the annual meeting of the stockholders (the "Annual
Meeting") of the Company to be held at the Crowne Plaza, Hawthorne Ballroom,
1360 Worcester Road (Route 9 East), Natick, Massachusetts, on Thursday, May 25,
2000, at 9:00 a.m., and at any adjournment or adjournments thereof, for the
purposes set forth in the accompanying Notice of Annual Meeting of Stockholders.
A WHITE proxy card is being sent to holders of the Company's Common Stock, $1.00
par value (the "Common Stock"). If the accompanying WHITE form of proxy is
executed and returned, it may nevertheless be revoked at any time insofar as it
has not been exercised either by notice to the Secretary of the Company, the
subsequent execution and delivery of another Proxy, or by voting in person at
the Annual Meeting. A BLUE Instruction Card is being sent to holders of the
Company's $21.25 Convertible Exchangeable Preferred Stock (the "Preferred
Stock"). If the accompanying BLUE Instruction Card is executed and returned, it
may nevertheless be revoked at any time up until 5:00 p.m. on May 24, 2000
either by filing a written revocation or a duly executed Instruction Card
bearing a later date. It is anticipated that the Proxy Statement and the
enclosed Proxy or Instruction Card, as applicable, will be mailed to the
stockholders of record on or about April 19, 2000.
The Board of Directors has fixed the close of business on April 3, 2000, as
the record date for the determination of the stockholders entitled to vote at
the Annual Meeting. As of April 3, 2000, the Company had outstanding 22,584,469
shares of Common Stock. Each share is entitled to one vote.
The terms of the Company's Preferred Stock provide that as a result of
dividends on the Preferred Stock being in arrears for at least six quarters, the
holders of the Preferred Stock are entitled, voting as a separate class, to
elect two (2) Directors (the "Preferred Directors") to the Company's Board of
Directors, to hold office until the earlier of (i) the date upon which their
elected term expires and until their successors are chosen and qualified or (ii)
until all dividends in arrears on the Preferred Stock have been paid or declared
and funds therefor set apart for payment. As of April 3, 2000, the Company had
outstanding 99,990 shares of Preferred Stock. Each share is entitled to one
vote. Bank Boston, N.A., as the Depositary for the Preferred Stock (the
"Depositary"), is the holder of all of the issued and outstanding Preferred
Stock. The terms of the Deposit Agreement by and among the Company, the
Depositary and the holders of Depositary Shares representing the Preferred Stock
provide that the holders of Depositary Shares are entitled to instruct the
Depositary to vote the shares of Preferred Stock represented by their respective
Depositary Shares. Each Depositary Share represents ownership of 1/10th of a
share of Preferred Stock. Therefore, as of April 3, 2000, there were outstanding
999,900 Depositary Shares. The holders of Depositary Shares should forward their
Instruction Cards to the Depositary instructing the Depositary how to vote the
Preferred Stock.
<PAGE>
STOCKHOLDER VOTES REQUIRED
Common Stock
- ------------
The presence, in person or by proxy, of at least a majority in interest of
the total number of outstanding shares of Common Stock is necessary to
constitute a quorum for transaction of business at the Annual Meeting.
Abstentions and "broker non-votes" will be counted as present for determining
the presence or absence of a quorum for the transaction of business at the
Annual Meeting. A "broker non-vote" is a proxy from a broker or other nominee
indicating that such person has not received instructions from the beneficial
owner or other person entitled to vote the shares on a particular matter with
respect to which the broker or other nominee does not have discretionary voting
power.
A quorum being present, the affirmative vote of a plurality of the votes
cast at the Annual Meeting is necessary to elect each of the nominees for
director. The affirmative vote by a majority of the votes cast at the Annual
Meeting is required to approve the Special Equity Incentive Plan. The
affirmative vote of a majority of the votes cast at the Annual Meeting by
holders of the Company's Common Stock is required to ratify the selection of
Arthur Andersen LLP as auditors for the fiscal year ending December 31, 2000.
Abstentions and broker non-votes will not be counted as voting at the Annual
Meeting and, therefore, will not have an effect on the election of Directors,
approval of the Special Equity Incentive Plan or ratification of auditors.
Preferred Stock
- ---------------
Assuming a quorum is present, the Depositary will vote the number of shares
of the Preferred Stock for a Nominee represented by the number of Depositary
Shares instructed to be voted for that Nominee. Under the terms of the Deposit
Agreement, in the absence of specific instructions from a holder of Depositary
Shares, the Depositary will abstain from voting to the extent of the Preferred
Stock represented by the Depositary Shares of such holder of Depositary Shares.
The two Preferred Director nominees for whom the greatest number of shares of
Preferred Stock is voted by the Depositary will be elected as the Preferred
Directors.
A holder of Depositary Shares may revoke an Instruction Card given with
respect to the Election of Preferred Directors by filing with the Depositary no
later than 5:00 p.m. on Wednesday, May 24, 2000, a written revocation or a duly
executed Instruction Card bearing a later date.
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Any proposal of a stockholder intended to be presented at the Company's
2001 Annual Meeting of Stockholders must be received by the Company for
inclusion in the proxy statement and form of proxy for that meeting no later
than December 5, 2000. In addition, stockholder proposals and director
nominations must comply with the requirements of the Company's By-Laws.
2
<PAGE>
1A. and 2A.
ELECTION OF DIRECTORS AND PREFERRED DIRECTORS
Common Stock Nominees
- ---------------------
In accordance with the Company's By-Laws and Massachusetts law, the Board
of Directors is divided into three approximately equal classes, with each
Director serving for a term of three years. As a consequence, the term of only
one class of Directors expires each year, and their successors are elected for
terms of three years. As of March 31, 2000, the Board of Directors is comprised
of 12 members; 10 Directors (as follows) and 2 Preferred Directors:
Class I: Robert Band, Michael R. Klein and Christopher H. Lee are
the three nominees for election as Directors at this
Annual Meeting to serve until the 2003 Annual Meeting of
Stockholders and until their successors are chosen and
qualified. Marshall M. Criser, a current Class I
Director, will not be a nominee for reelection.
Class II: Richard J. Boushka, Jane E. Newman and Ronald N. Tutor
were elected as Directors at the 1998 Annual Meeting to
serve until the 2001 Annual Meeting of Stockholders
and until their successors are chosen and qualified.
Effective March 29, 2000, Robert A. Kennedy was
appointed a Class II Director by the Company's Board of
Directors to serve until the 2001 Annual Meeting of
Stockholders and until his successor is duly chosen and
qualifed.
Class III: Nancy Hawthorne was elected as a Director at the 1999
Annual Meeting to serve until the 2002 Annual Meeting of
Stockholders and until her successor is chosen and
qualified. Effective March 29, 2000, Raymond R. Oneglia
was appointed a Class III Director by the Company's Board
of Directors to serve until the 2002 Annual Meeting of
Stockholders and until his successor is duly chosen and
qualified.
The Nominating Committee of the Board of Directors of the Company has
nominated Robert Band, Michael R. Klein and Christopher H. Lee for election as
Class I Directors. Unless otherwise noted thereon, proxies solicited hereby will
be voted for the election of Messrs. Band, Klein and Lee as Directors to hold
office until the 2003 Annual Meeting of Stockholders and until their successors
are chosen and qualified. The Board of Directors does not contemplate that any
nominee will be unable to serve as a Director for any reason but, if that should
occur prior to the meeting, the proxy holders will select another person in his
place and stead. Information regarding these nominees for election as Directors,
as well as each Director whose term is not scheduled to expire until the 2001 or
2002 Annual Meeting of Stockholders, is set forth in "Ownership of Common Stock
by Directors, Officers and Preferred Stock Nominees" on pages 5 through 10.
The Board recommends a vote FOR the election of each of the nominees for
election as Directors.
3
<PAGE>
Preferred Stock Nominees
- ------------------------
The terms of the Company's Preferred Stock provide that as a result of
dividends on the Preferred Stock being in arrears for at least six quarters, the
holders of the Preferred Stock are entitled, voting as a separate class, to
elect two (2) Directors (the "Preferred Directors") to the Company's Board of
Directors, to hold office until the earlier of (i) the date upon which their
elected term expires and until their successors are chosen and qualified or (ii)
until all dividends in arrears on the Preferred Stock have been paid or declared
and funds therefor set apart for payment. Since the dividend on the Preferred
Stock had not been paid since December 1995, the holders of the Preferred Stock
elected Arthur I. Caplan and Frederick Doppelt at the May 14, 1998 Annual
Meeting of Stockholders to serve as the Preferred Directors and re-elected them
at the May 13, 1999 Annual Meeting of Stockholders until the earlier of (i) the
next annual meeting of stockholders and until their successors were chosen and
qualified or (ii) payment in full by the Company of dividends owed on the
Preferred Stock. The Company has not paid any dividends on the Preferred Stock
throughout 1999 and 2000 to date. Accordingly, the holders of the Preferred
Stock, voting as a separate class, remain entitled to elect two (2) Preferred
Directors to the Company's Board of Directors.
Preferred Stock Arthur I. Caplan, Frederick Doppelt, Stephen J.
Nominees: McAllister and Martin Shubik are the four nominees
for election as Preferred Directors at this Annual
Meeting to serve until the earlier of (i) the 2001
Annual Meeting of Stockholders and until their
successors are chosen and qualified or (ii) all
dividends in arrears on the Preferred Stock have
been paid or declared and funds therefor set apart
for payment.
The two Nominees who receive the greatest number of votes will be elected
as Preferred Directors. Instruction Cards that are not completed will not be
voted for any nominee. The Board of Directors does not contemplate that any
nominee will be unable to serve as a Preferred Director for any reason but, if
that should occur prior to the meeting, the Depositary will select another
person in his place and stead. Information regarding these nominees for election
as Preferred Directors is set forth in "Ownership of Common Stock by Directors,
Officers and Preferred Stock Nominees" on pages 5 through 10.
4
<PAGE>
OWNERSHIP OF COMMON STOCK BY DIRECTORS, OFFICERS
AND PREFERRED STOCK NOMINEES
The following table sets forth certain information received by the Company
from the individuals listed below concerning their respective beneficial
ownership as of March 31, 2000 of the Common Stock of the Company by each
Director, named Executive Officer of the Company and Preferred Stock Nominees,
and by all Directors and Executive Officers of the Company as a group. Also,
included in the table with respect to each Director and Preferred Stock Nominee
is principal occupation or employment during the past five years, age and the
period served as a Director of the Company.
<TABLE>
<CAPTION>
Number of Shares of Common Stock of the
Company Beneficially Owned
On March 31, 2000(1)(2)
---------------------------------------------
Served Sole Voting
as a and
Name and Principal Occupation for The Director Investment Percentage
Past Five Years Age Since Power Shared Aggregate of Class
- ------------------------------------------- ------ --------- -------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Ronald N. Tutor (5)(7) 59 1997 2,704,260 (8) 0 2,704,260 11.97%
Director; Chairman and Chief Executive
Officer since March 29, 2000, fomerly
Chairman since July 1, 1999, formerly
Vice Chairman since January 1, 1998 and
Acting Chief Operating Officer since January
17, 1997, and Chairman, President and
Chief Executive Officer, Tutor-Saliba
Corporation
Robert Band (7) 52 1999 40,894 (9) 0 40,894 *
Director; President and Chief Operating
Officer since March 29, 2000, formerly
President and Chief Executive Officer
since May 12, 1999, formerly Executive
Vice President, Chief Financial Officer
since December 1997 and President of Perini
Management Services, Inc.
Richard J. Boushka (3)(4)(5) 65 1975 7,390(10) 0 7,390 *
Director; Principal, Boushka
Properties, a private investment firm
Marshall M. Criser (3)(4)(6) 71 1985 11,366 (11) 200 (12) 11,566 *
Director; Vice Chairman since July 1,
1999, Retired Partner, Law firm of
McGuire, Woods Battle & Boothe, LLP,
formerly Chairman, Law firm of Mahoney
Adams and Criser and formerly President,
University of Florida
Arthur J. Fox, Jr. (4)(5)(6) 76 1989 11,729 (13) 0 11,729 *
Director; Self-employed consultant,
formerly Managing Director, Construction
Industry Presidents Forum; Editor Emeritus,
Engineering News-Record
Jane E. Newman (3)(5) 54 1992 9,745 (14) 0 9,745 *
Director; Managing Director and
Partner, The Commerce Group since
January 1, 1999, formerly Interim Dean,
Whittemore School of Business & Economics,
University of New Hampshire, and
formerly Executive Vice President,
Exeter Trust Company
5
<PAGE>
Number of Shares of Common Stock of the
Company Beneficially Owned
On March 31, 2000(1)(2)
---------------------------------------------
Served Sole Voting
as a and
Name and Principal Occupation for The Director Investment Percentage
Past Five Years Age Since Power Shared Aggregate of Class
- ------------------------------------------- ------ --------- -------------- ----------- ----------- -----------
Nancy Hawthorne (3)(4)(6) 48 1993 10,361 (15) 0 10,361 *
Director; Chair, World Clinic, Inc.
since mid-1999, formerly self-employed
financial strategy consultant since
mid-1998, formerly Chief Executive
Officer & Managing Partner, Hawthorne,
Krauss & Associates, and formerly Executive
Vice President, Media One
Michael R. Klein (3)(16) 57 1997 7,261 (17) 0 7,261 *
Director; Chairman, CoStar Group, Inc.
and Partner, Law Firm of Wilmer, Cutler &
Pickering
Robert A. Kennedy (18) 64 2000 0 0 0 -
Director; Director of Special Projects
- Financial Services for ULLICO, Inc.
Christopher H. Lee (19) 47 2000 0 0 0 -
Director; Vice President, AIG Global
Investment Corp., a wholly-owned
subsidiary of American International
Group, Inc.
Raymond R. Oneglia (20) 52 2000 0 0 0 -
Director; Vice Chairman, O&G
Industries, Inc.
Zohrab B. Marashlian 55 - 28,259 (21) 0 28,259 *
President, Perini Civil Construction
David B. Perini (7) 62 1970 138,249 (22) 0 138,249 *
Chairman Emeritus, formerly Chairman of
the Board of Directors
Craig W. Shaw 45 - 32,300 (23) 0 32,300 *
President, Perini Building Company, Inc.
Preferred Stock Nominees:
Arthur I. Caplan (24) 79 1998 5,776 (25) 0 5,776 *
Director; formerly President of
HWC-Ltd., an automobile sales, leasing and
financing organization
Frederick Doppelt (24) 81 1998 42,921 (26) 0 42,291 *
Director; Self-employed attorney
specializing in trust and estate matters
Stephen J. McAllister (24) (27) 38 - 97,645 (28) 0 97,645 *
Member, Asher B. Edelmand Associates, an
investment and money management firm
and advisor to various funds since January,
1997, formerly Portfolio Manager and Chief
Investment Strategist for Bank of Tokyo
(Switzerland) S.A.
Martin Shubik (24) (27) 74 - 15,888 (29) 0 15,888 *
Professor of Economics, Yale University
All Directors and Executive Officers as 3,010,660 200 3,010,860 13.33%
a group (16 persons)
- -------------------------------------------
* Less than one percent
</TABLE>
6
<PAGE>
(1) Beneficial ownership is the direct or indirect ownership of Common Stock of
the Company including the right to control the vote or investment of or
acquire such Common Stock (for example, through the conversion of shares of
the $2.125 Depositary Convertible Exchangeable Preferred Shares, exercise
of options or various trust arrangements) within the meaning of Rule 13d-3
under the Securities Exchange Act of 1934. The shares owned by each person
or by the group, and the shares included in the total number of shares
outstanding have been adjusted in accordance with said Rule 13d-3. Any
securities not outstanding but which are subject to options, warrants,
rights or conversion privileges shall be deemed to be outstanding for the
purpose of computing the percentage of outstanding securities of the class
owned by such person but shall not be deemed to be outstanding for the
purpose of computing the percentage of outstanding securities of the class
owned by any other person.
(2) The table does not include an aggregate of 10,803 shares allocated to Named
Executive Officers under the terms of the Perini Corporation Employee Stock
Ownership Plan.
(3) Member of the Audit Committee.
(4) Member of the Compensation Committee.
(5) Member of the Nominating Committee.
(6) Member of the Special Committee.
(7) Due to the resignation of the previous Chief Executive Officer, Roger J.
Ludlam, effective January 31, 1999, David B. Perini and Ronald N. Tutor
shared the responsibilities of President and Chief Executive Officer of the
Company until the new Chief Executive Officer, Robert Band, was appointed
on May 12, 1999. Effective June 30, 1999, Mr. Perini retired from the
Company and resigned his position as Chairman. The Board of Directors
appointed Mr. Tutor as Chairman effective July 1, 1999. Effective March 29,
2000, the Board of Directors appointed Mr. Tutor as Chairman and Chief
Executive Officer and Mr. Band as President and Chief Operating Officer.
(8) Represents shares held in the name of Tutor-Saliba Corporation, a company
in which Mr. Tutor is the sole stockholder and Chief Executive Officer. See
"Certain Other Beneficial Holders" on pages 12 and 13.
(9) Includes 15,500 shares for which Mr. Band holds options.
(10) Includes 7,390 shares of Common Stock received in payment of the director's
annual retainer, as follows: 129 shares (1996), 2,285 shares (1997), 1,855
shares (1998) and 3,121 shares (1999). See "Directors' Compensation" on
page 25.
7
<PAGE>
(11) Includes 2,349 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
9,017 shares of Common Stock received in payment of the director's annual
retainer, as follows: 1,756 shares (1996), 2,285 shares (1997), 1,855
shares (1998) and 3,121 shares (1999). See "Directors' Compensation" on
page 25.
(12) Includes 200 shares which Mr. Criser owns jointly with his wife.
(13) Includes 2,197 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
9,017 shares of Common Stock received in payment of the director's annual
retainer, as follows: 1,756 shares (1996), 2,285 shares (1997), 1,855
shares (1998) and 3,121 shares (1999). See "Directors' Compensation" on
page 25.
(14) Includes 1,148 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
8,597 shares of Common Stock received in payment of the director's annual
retainer, as follows: 1,336 shares (1996), 2,285 shares (1997), 1,855
shares (1998) and 3,121 shares (1999). See "Directors' Compensation" on
page 25.
(15) Includes 1,344 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
9,017 shares of Common Stock received in payment of the director's annual
retainer, as follows: 1,756 shares (1996), 2,285 shares (1997), 1,855
shares (1998) and 3,121 shares (1999). See "Directors' Compensation" on
page 25.
(16) Mr. Klein is the designated representative of P.B. Capital Partners, L.P.,
a partnership that owns 4,656,795 shares of Common Stock and a partnership
whose sole general partner is BLUM Capital Partners, L.P. ("BCP"). BCP is
an investment advisor to The Common Fund for Non-Profit Organizations for
the account of its Equity Fund that owns 1,162,348 shares of Common Stock.
Mr. Klein disclaims beneficial ownership in any of these shares. See
"Certain Other Beneficial Holders" on pages 12 and 13.
(17) Includes 7,261 shares of Common Stock received in payment of the director's
annual retainer, as follows: 2,285 shares (1997), 1,855 shares (1998) and
3,121 shares (1999). See "Directors' Compensation" on page 25.
(18) Mr. Kennedy is the designated representative of Union Labor Life Insurance
Company, a company that owns 1,721,075 shares of Common Stock, and a
wholly-owned subsidiary of ULLICO, Inc., a company in which Mr. Kennedy is
the Director of Special Projects. Mr. Kennedy disclaims any beneficial
ownership of these shares. See "Certain Other Beneficial Holders" on pages
12 and 13.
(19) Mr. Lee is the designated representative of National Union Fire Insurance
Company of Pittsburgh, Pa., a company that owns 4,705,882 shares of Common
Stock, and an affiliate of AIG Global Investment Corp., a company in which
Mr. Lee is a Vice President and both of which are wholly-owned subsidiaries
of American International Group, Inc. Mr. Lee disclaims any beneficial
ownership of these shares. See "Certain Other Beneficial Holders" on pages
12 and 13.
8
<PAGE>
(20) Mr. Oneglia is the designated representative of O&G Industries, Inc., a
company that owns 2,502,941 shares of Common Stock, and a company in which
Mr. Oneglia is the Vice Chairman. Mr. Oneglia disclaims any beneficial
ownership of these shares. See "Certain Other Beneficial Holders" on pages
12 and 13.
(21) Includes 28,000 shares for which Mr. Marashlian holds options.
(22) Includes 6,460 shares, and 264 shares of Common Stock (resulting from the
assumed conversion of 400 depositary shares of Preferred Stock at a
conversion rate of .662 shares of Common Stock for each depositary share)
in his childrens' names for which he has Power of Attorney giving him
voting power. Includes 7,500 shares for which Mr. Perini holds options.
Includes 66 shares of Common Stock resulting from the assumed conversion of
100 depositary shares of Preferred Stock. Includes 56,499 shares held in
testamentary trust established under the will of Louis R. Perini, Sr. David
Perini is one of four trustees of such trust and is one of the
beneficiaries of such trust. Includes 3,029 shares, and 66 shares of Common
Stock (resulting from the assumed conversion of 100 depositary shares of
Preferred Stock) in his wife's name as to which Mr. Perini disclaims any
beneficial ownership.
(23) Includes 28,000 shares for which Mr. Shaw holds options
(24) Represents one of four Nominees for election as Preferred Directors at this
Annual Meeting (of which the two with the greatest number of votes cast by
holders of the $2.125 Depositary Shares will be elected) to serve until the
earlier of (i) the 2001 Annual Meeting of Stockholders and until their
successors are chosen and qualified or (ii) all dividends in arrears on the
Preferred Stock have been paid or declared and funds therefore set apart
for payment.
(25) Includes 3,121 shares of Common Stock received in payment of the 1999
director's annual retainer. See "Directors' Compensation" on page 25. Also
includes 1,655 shares of Common Stock resulting from the assumed conversion
of 2,500 depositary shares of Preferred Stock at a conversion rate of .662
shares of Common Stock for each depositary share. The percentage of
Preferred Stock beneficially owned by Mr. Caplan to the total number of
shares of Preferred Stock outstanding is less than 1%.
(26) Includes 3,121 shares of Common Stock received in payment of the 1999
director's annual retainer. See "Directors' Compensation" on page 25. Also
includes 37,800 shares of Common Stock resulting from the assumed
conversion of 57,100 depositary shares of Preferred Stock at a conversion
rate of .662 shares of Common Stock for each depositary share. Of the
57,100 depositary shares of Preferred Stock, 2,000 depositary shares are
owned by Mr. Doppelt's wife. The percentage of Preferred Stock beneficially
owned by Mr. Doppelt to the total number of shares of Preferred Stock
outstanding is 5.71%.
(27) Messrs. McAllister and Shubik were nominated by Edelman Value Partners,
L.P. (direct owners of 100 depositary shares and beneficial owners of
57,400 depositary shares), Edelman Value Fund Ltd. (beneficial owner of
75,500 depositary shares) and M.J. Whitman Pilot Fish Opportunity, L.P.
(owner of 9,500 depositary shares).
9
<PAGE>
(28) Represents 97,645 shares of Common Stock resulting from the assumed
conversion of 147,500 depositary shares of Preferred Stock at a conversion
rate of .662 shares of Common Stock for each depositary share. These shares
are held by a custodian on behalf of certain funds for which Mr.
McAllister's firm is an investment advisor. The percentage of Preferred
Stock beneficially owned by Mr. McAllister to the total number of shares of
Preferred Stock outstanding is 14.75%.
(29) Represents 15,888 shares of Common Stock resulting from the assumed
conversion of 24,000 depositary shares of Preferred Stock at a conversion
rate of .662 shares of Common Stock for each depositary share. Included in
the total of 24,000 depositary shares are 13,000 depositary shares held in
a trust of which Mr. Shubik is a trustee. The percentage of Preferred Stock
beneficially owned by Mr. Shubik to the total number of shares of Preferred
Stock outstanding is 2.4%.
10
<PAGE>
The Board of Directors met six times during 1999. The Board of Directors
has a Compensation Committee, the duties of which are summarized in "The
Compensation Committee Report" on pages 16 through 18 herein. The Compensation
Committee held three meetings during 1999. The Board also has an Audit
Committee, the duties of which are to oversee the audit function of the
Company's independent certified public accountants, to review periodically
significant financial information relating to the Company and to act as a
communication link between the Board of Directors and such certified public
accountants. The Audit Committee met five times during 1999. The Board of
Directors has a Nominating Committee which met once during 1999. The Board of
Directors has an Executive Committee, the duties of which are to give final
approval of certain decisions (generally financial in nature) and to give
overall direction to the Company's Chief Executive Officer. This Committee met
three times during 1999. Effective July 16, 1999, the Board of Directors formed
a Special Committee, composed of three independent directors, to review any
financial proposal submitted by Mr. Ronald N. Tutor, Chairman of the Board of
Directors of the Company (see "Certain Transactions" on pages 25 and 26) to
purchase additional equity in the Company and also authorized the Special
Committee to solicit and negotiate alternative proposals from third parties.
This Committee met twenty-two times during 1999. The members of each such
committee are identified in the above table. During 1999 all of the Directors of
the Company attended at least 75% of the meetings of the Board of Directors and
its committees of which they are members, except for Douglas J. McCarron who
attended approximately 25% of such meetings.
As of March 31, 2000, none of the Directors or Nominees for Preferred
Director is a director of any company which is subject to the reporting
requirements of the Securities Exchange Act of 1934 or which is a registered
investment company under the Investment Company Act of 1940 except as set forth
below:
Name of Director Director of
- ---------------- -----------
Richard J. Boushka................................Tremont Corporation
Marshall M. Criser................................FPL Group, Inc.
Nancy Hawthorne...................................Avid Technology
Michael R. Klein..................................CoStar Group, Inc.
Jane E. Newman....................................SALLIE MAE Holding Corporation
Public Service Co. of NH
Martin Shubik.....................................Third Avenue Trust
11
<PAGE>
CERTAIN OTHER BENEFICIAL HOLDERS
The following table sets forth certain information concerning beneficial
ownership as of March 31, 2000 of the Common Stock of the Company by certain
other holders of in excess of 5% of the Common Stock of the Company.
According to the information available to the Board of Directors no person
owns of record or beneficially more than 5% of the outstanding Common Stock of
the Company except as set forth below and except for Ronald N. Tutor as set
forth in "Ownership of Common Stock by Directors, Officers and Preferred Stock
Nominees" on pages 5 through 10:
<TABLE>
Amount and
Nature of
Beneficial Percentage of
Name and Address Ownership (1) Class
- ------------------------------------------------------------- ------------------ ---------------
<S> <C> <C>
Tutor-Saliba Corporation 2,704,260 (2)(7) 11.97%
15901 Olden Street
Sylmar, CA 91342
National Union Fire Insurance Company of Pittsburgh, Pa. 4,705,882 (3)(7) 20.84%
70 Pine Street
New York, NY 10270
O&G Industries, Inc. 2,502,941 (4)(7) 11.08%
112 Wall Street
Torrington, CT 06790
BLUM Capital Partners, L.P. 5,823,397 (5)(7) 25.78%
909 Montgomery Street, Suite 400
San Francisco, CA 94133
PB Capital Partners, L.P. 4,656,795 (5)(7) 20.62%
909 Montgomery Street, Suite 400
San Francisco, CA 94133
The Common Fund for Non-Profit Organizations 1,162,348 (5)(7) 5.15%
c/o BLUM Capital Partners, L.P.
909 Montgomery Street, Suite 400
San Francisco, CA 94133
The Union Labor Life Insurance Company Separate Account P 1,721,075 (6)(7) 7.62%
111 Massachusetts Avenue, NW
Washington, DC 20001
</TABLE>
(1) See Footnote (1) on Page 7.
(2) Represents sole voting and investing power based on information contained
in Schedule 13D/A of Tutor-Saliba Corporation dated February 10, 2000 and
as updated for Tutor-Saliba Corporation's participation in the New Equity
described in "Certain Transactions" on pages 25 and 26. Ronald N. Tutor,
Chairman of the Company's Board of Directors, is also the sole stockholder
and Chief Executive Officer of Tutor-Saliba Corporation.
(3) Represents shared voting and investment powers based on information
contained in Schedule 13D of American International Group, Inc. ("AIG") the
parent company of National Union Fire Insurance Company of Pittsburgh, Pa.
("National Union"), filed on February 15, 2000 and as updated for National
Union's participation in the New Equity described in "Certain Transactions"
on pages 25 and 26.
12
<PAGE>
(4) Represents sole voting and investment powers based on information contained
in Schedule 13D of O&G Industries, Inc. ("O&G") filed on February 15, 2000
and as updated for O&G's participation in the New Equity described in
"Certain Transactions" on pages 25 and 26.
(5) BLUM Capital Partners, L.P. ("BCP"), formerly known as Richard C. Blum &
Associates, L.P., is the sole general partner of PB Capital Partners, L.P.
("PB Capital") which beneficially has shared voting and investing power in
4,606,994 shares of Common Stock and 49,801 shares of Common Stock owned
directly by a limited partner in PB Capital. BCP also owns 4,254 shares of
Common Stock directly. In addition, BCP is an investment adviser to The
Common Fund for Non-Profit Organizations for the account of its Equity Fund
("The Common Fund") which beneficially has shared voting and investing
power in 1,162,348 shares of Common Stock. Richard C. Blum & Associates,
Inc. ("RCBA Inc."), also at 909 Montgomery Street, Suite 400, San
Francisco, California 94133, is the sole general partner of BCP. Richard C.
Blum is the Chairman of the Board and a substantial shareholder of RCBA
Inc. Mr. Blum disclaims beneficial ownership of all securities reported in
the table except to the extent of his pecuniary interest therein. The
Common Fund expressly disclaims membership in any group with BCP, Richard
C. Blum or any other related entity and disclaims beneficial ownership of
securities owned directly or indirectly by any other person or entity.
(6) Represents sole voting and investing power based on information contained
in Schedule 13D dated December 16, 1996 filed by Union Labor Life Insurance
Company, a wholly-owned subsidiary of ULLICO, Inc. and as updated for the
"Exchange" described in "Certain Transactions" on pages 25 and 26.
(7) Pursuant to the Shareholders' Agreement referred to under "Change in
Control" on pages 14 and 15, these Shareholders and the Company agree to,
among other things, nominate certain individuals designated by these
shareholders for election or appointment to the Board of Directors of the
Company and the Shareholders have agreed to vote for each of the designated
nominees.
13
<PAGE>
Change In Control
- -----------------
On March 29, 2000, Tutor-Saliba Corporation ("Tutor-Saliba"), O&G
Industries, Inc. ("O&G") and National Union Fire Insurance Company of
Pittsburgh, Pa. ("National Union") and together with Tutor-Saliba and O&G, (the
"Purchasers") purchased 9,411,765 shares of Common Stock (the "Purchase Shares")
of the Company for an aggregate purchase price of $40 million (the
"Transaction"). In connection therewith, the Company exchanged 7,490,417 shares
of Common Stock for all of the outstanding shares of Series B Cumulative
Convertible Preferred Stock ("Series B Preferred Stock") at an exchange price of
$5.50 per share of Common Stock. The Purchasers now own approximately 44% of the
Company's Common Stock and the former holders of Series B Preferred Stock now
own approximately 33% of the Company's Common Stock. As a result, this
transaction may have constituted a change of control under the Exchange Act.
The Purchasers and former holders of the Series B Preferred Stock entered
into a Shareholders' Agreement (the "Shareholders' Agreement") at the closing of
the Transaction. Among other things, the Shareholders' Agreement provides that
between the third and sixth anniversaries of the closing of the Transaction
(and, under certain circumstances, prior to the third anniversary), National
Union will have a "put" right to cause Tutor-Saliba and/or Mr. Ronald N. Tutor
to purchase half of its Purchase Shares at a price so that National Union earns
a ten percent internal rate of return on its investment in such shares. During
the same period, between the third and sixth anniversaries of the closing of the
Transaction, Tutor-Saliba will have a "call" right to cause National Union to
sell such shares to Tutor-Saliba at a price so that National Union earns a
fourteen percent internal rate of return on its investment in such shares. In
addition to the foregoing put and call rights, National Union will have a right
of first refusal on Tutor-Saliba's disposition of its Purchase Shares and
Tutor-Saliba will have a right of first refusal on one half of National Union's
Purchase Shares.
Subject to the right of first refusal described in the prior paragraph, the
parties to the Shareholders' Agreement have certain "tag-along" rights. If any
party to the Shareholders' Agreement desires to sell its shares, each of the
non-selling parties to the Shareholders' Agreement will have the right to
participate in such sale and to dispose of its pro rata share of the stock to be
sold in such transaction. However, National Union may sell up to one half of its
Purchase Shares without triggering the foregoing tag-along right.
The Shareholders' Agreement contains provisions that are designed to
protect the Company's use of its net operating losses ("NOLs") after the
Transaction. Each of the Purchasers and the former holders of Series B Preferred
Stock have agreed to notify the Company of any proposed purchase or sale of the
Company's securities, to give each other the opportunity to participate in
proposed sales in proportion to their ownership as of the closing and to
consummate such purchase or sale only if the Company's tax advisor or the
selling party's tax advisor has provided the Company with written advice that
the proposed purchase or sale will not impair the ability of the Company to
fully utilize its NOLs.
Each of the parties to the Shareholders' Agreement has the right to
subscribe to any new issuance of securities (except for certain issuances such
as conversions of convertible securities, exercises of options or issuances
pursuant to a benefit plan) by the Company in an amount up to such stockholder's
pro rata share of the new issuance of securities based on their percentage
ownership of the Company's outstanding Common Stock.
Finally, the Shareholders' Agreement gives National Union, Tutor-Saliba,
O&G, PB Capital Partners, L.P. ("PB Capital") and the Union Labor Life Insurance
Company acting on behalf of its Separate Account P ("ULLICO") the right to
designate one director each for election
15
<PAGE>
to the Board of Directors of the Company. The Company has agreed to nominate
such individuals for election or appointment to the Board of Directors at the
earliest possible time, to use its best efforts to cause such persons to be
elected to the Board, and to renominate each such person (or other person as may
be designated by National Union, Tutor-Saliba, O&G, PB Capital or ULLICO) at
such time as he or she is required to stand for reelection to the Board. The
right to designate a person to be elected as a director terminates in the case
of each Purchaser, when such Purchaser and its permitted transferees own less
than 25% of the Common Stock purchased by such Purchaser in the Transaction and
in the case of PB Capital and ULLICO, when such stockholder and its permitted
transferees own less than 5% of the outstanding shares of Common Stock. Each of
PB Capital and ULLICO also have certain observer rights on the Board until such
time as it ceases to own 2.5% of the outstanding shares of Common Stock. Each
party to the Shareholders' Agreement has agreed to vote all of its shares in
favor of the directors designated by each of the other parties thereto.
15
<PAGE>
THE COMPENSATION COMMITTEE REPORT
During 1999, the Compensation Committee of the Board of Directors of the
Company consisted of five Directors, none of whom is an employee or an officer
of the Company. The principal powers and duties of the Compensation Committee as
established by the Board of Directors are:
1. To review the Executive Compensation programs and policies and to
employ outside expert assistance, if required, to analyze Company
compensation practices to assure that they are consistent with
corporate goals and objectives, and competitive with those of
comparable firms in the construction industry.
2. To recommend to the Board of Directors for its approval the base
compensation of the Chairman and Chief Executive Officer and the base
salary of the President and Chief Operating Officer and to review and
approve the salary recommendations of the Chairman and Chief Executive
Officer with respect to other members of top management;
3. To recommend to the Board of Directors annual profit and other targets
for the Company for the purpose of determining incentive compensation
awards under the provisions of the Amended and Restated General
Incentive Compensation Plan, for those included in the Company pool;
and
4. To administer the Amended and Restated General and Construction
Business Unit Incentive Compensation Plans; such administration shall
include the power to (i) approve Participants' participation in the
Plans, (ii) establish performance goals, (iii) determine if and when
any bonuses shall be paid, (iv) pay out any bonuses, in cash or stock
or a combination thereof, as the Committee shall determine from year
to year, (v) construe and interpret the Plans, and (vi) establish
rules and regulations and perform all other acts it believes
reasonable and proper.
Compensation Policy
- -------------------
The Compensation Committee strives to maintain corporate base salaries and
the total compensation package appropriate to attract and retain highly
qualified executives. This results in base salaries that generally are at the
median range of those of other construction companies but allows executives to
substantially exceed the median compensation levels when incentive compensation
is earned. While recognizing that it may be difficult to find other companies
with the same mix of business as the Company, the Committee, nevertheless,
believes that a comparison with other construction companies is appropriate. The
construction companies used for comparison for compensation purposes may include
but are not limited to the same companies which make up the construction peer
group shown in the Performance Graph set forth in this proxy statement.
The compensation program for executive officers is composed of three
elements: base salaries, annual incentive bonuses and long term incentive stock
awards. These elements of compensation are designed to provide incentives to
achieve both short-term and long-term objectives and to reward exceptional
performance. Salaries and annual incentive compensation bonuses result in
payment for performance and are tied to the achievement of profit and/or cash
flow targets. The value of the incentive stock awards depends upon the
appreciation in market value of the Company's Common Stock.
16
<PAGE>
Executive Salary Increases in 1999
- ----------------------------------
The former President and Chief Executive Officer of the Company, Roger J.
Ludlam, resigned effective January 31, 1999. The Chairman of the Company at that
time, David B. Perini, and the Vice Chairman of the Company at that time, Ronald
N. Tutor, jointly assumed the responsibilities of Chief Executive Officer
pending the appointment of the new Chief Executive Officer, Robert Band, who was
promoted on May 12, 1999 from his prior position of Executive Vice President and
Chief Financial Officer. Effective June 30, 1999, Mr. Perini retired from the
Company as an employee, from his office of Chairman and also as Chairman of the
Board of Directors. With the retirement of Mr. Perini, the Board of Directors
appointed Mr. Tutor Chairman effective July 1, 1999. (Effective March 29, 2000,
the Board of Directors appointed Mr. Tutor as Chairman and Chief Executive
Officer and Mr. Band as President and Chief Operating Officer.)
The last salary increase for the former Chairman, Mr. Perini, was as of
December 1994. As of December 31, 1999 there has been no increase for the
current Chairman, Mr. Tutor, and the majority of senior officers' salaries
remained unchanged throughout 1999.
Section 162 (m) of the Internal Revenue Code, enacted in 1993, generally
disallows a tax deduction to public companies for compensation over $1,000,000
paid to the Company's Chief Executive Officer and four other most highly
compensated executive officers. The Compensation Committee has not established
any policy regarding annual compensation to such executive officers in excess of
$1,000,000. However, to date, no officer of the Company has received
compensation in excess of $1,000,000 for any annual period.
Compensation of the Chairman and the Chief Executive Officer
- ------------------------------------------------------------
The annual base salary of the former Chairman, Mr. Perini, remained through
June 30, 1999, the date of his retirement, at $412,000 which has not changed
since 1994 and he was not awarded incentive compensation for 1999. The current
Chairman, Mr. Tutor, is generally compensated for his services under a
management services contract between the Company and Tutor-Saliba Corporation, a
company in which Mr. Tutor is the Chief Executive Officer and sole stockholder,
at a monthly rate of $12,500, which remained the same during 1999. Mr. Tutor was
not awarded any incentive compensation for 1999. The Committee approved the base
salary for the newly appointed President and Chief Executive Officer, Mr. Band,
at an annual rate of $260,000 effective May 12, 1999. In addition, he earned
$251,154 in incentive compensation based principally on achievement of
pre-established corporate goals prior to the real estate write down (see Note 2
of Notes to Consolidated Financial Statements included in the Company's 1999
Annual Report which accompanies this Proxy Statement).
The Incentive Compensation Plan of the Company
- ----------------------------------------------
The Incentive Compensation Plan is an integral part of the total
compensation package of the current President and Chief Operating Officer, as
well as the 10 executives whose salaries were reviewed by the Compensation
Committee in 1999 and approximately 53 other employees of the Company.
Eligibility and designated levels of participation are determined by the
Chairman and Chief Executive Officer subject to Compensation Committee approval.
Eligibility to participate under the Plan is limited to individuals who are
executives, managers and key employees of the Company and its wholly-owned
subsidiaries, whose duties and responsibilities provide them the opportunity to
(i) make a material and significant impact to the financial performance of the
Company; (ii) have major responsibility in the control of the corporate assets;
and (iii) provide critical staff support necessary to enhance operating
profitability.
17
<PAGE>
Participants can achieve incentive compensation awards ranging from zero to
as much as 100% of base salary, part of which depends on the achievement of
business unit goals and part on the achievement of corporate goals. Each of the
business unit presidents has the opportunity to earn up to an additional 50% of
base salary for performance which is substantially above pre-established
targets. The mechanisms of the Plan are expressed in terms of levels of
participation, points deriving therefrom calculated on base salary, and
achievement of goals such as net income, cash flow, and pre-tax construction
profits on a unit by unit basis and on an overall corporate basis. The current
President and Chief Operating Officer, other corporate officers and key
corporate staff earn incentive compensation solely with reference to overall
corporate goals.
No sums attributed to a participant in the Incentive Compensation Plan
become vested until the Compensation Committee approves the payment, usually in
March following the year earned. At the discretion of the Committee, payment can
be made in cash, stock or a combination of cash and stock.
In 2000, the Committee authorized the payment of $3,394,000 of Incentive
Compensation payments for 1999 operations, to 60 participants. Payment of
incentive compensation awards for 1999 performance will be paid 100% in cash.
COMPENSATION COMMITTEE
Richard J. Boushka, Chairman
Marshall M. Criser
Arthur J. Fox, Jr.
Nancy Hawthorne
18
<PAGE>
EXECUTIVE COMPENSATION AND OTHER INFORMATION
Summary of Cash and Certain Other Compensation
- ----------------------------------------------
The following table sets forth the cash compensation paid by the Company
and its subsidiaries, as well as certain other compensation paid or accrued for
those years, to the Chief Executive Officer and each of the four other most
highly compensated Executive Officers of the Company whose salary and bonus
exceeded $100,000 (the "Named Executive Officers") for the years ended December
31, 1999, 1998 and 1997, or for each year in which the Named Executive Officers
served as such.
<TABLE>
<CAPTION>
Summary Compensation Table
Annual Compensation Long-Term Compensation
--------------------------------------------------- -------------------------------
Awards Payouts
------------ ---------------
Number of
Securities Long-Term
Underlying Performance All Other
Name and Principal Bonus Other Options Units - Payout Compensation
Position Year Salary (1) (2) Granted (3)
- -------------------------- ------- ---------- ---------- ---------- ------------ --------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ronald N. Tutor (4) 1999 $ - $ - $150,000 (5) 30,000 $ - $ -
Chairman and Chief 1998 - - 150,000 (5) 45,000 - -
Executive Officer since 1997 - - - - - -
March 29, 2000, formerly
Chairman
Robert Band (4) 1999 251,154 251,154 - - - 1,000
President and Chief 1998 230,000 207,000 - 37,500 - 1,800
Operating Officer since 1997 - - - - - -
March 29, 2000, formerly
President and Chief
Executive Officer
Zohrab B. Marashlian 1999 250,000 375,000 - - - 1,000
President, Perini Civil 1998 - - - - - -
Construction 1997 - - - - - -
David B. Perini (4) 1999 206,000 - 206,000 (6) - - 1,000
Chairman Emeritus and 1998 412,000 - - 37,500 - 1,800
formerly Chairman of the 1997 412,000 - - - - 1,700
Board of Directors
Craig W. Shaw 1999 250,000 375,000 - - - 1,000
President, Perini 1998 - - - - - -
Building Company, Inc. 1997 - - - - - -
- --------------------------
</TABLE>
(1) Of the total bonus (or incentive compensation) reported for each of the
Named Executive Officers, 40% of the 1998 bonus amount was paid in shares
of the Company's Common Stock. The remaining bonus amounts were paid in
cash.
(2) Other annual compensation does not include a dollar amount which the
Company is unable to quantify, but which is estimated at not more than the
lesser of $50,000 or 10% of the compensation reported for each Named
Executive Officer, resulting from executive perquisites which may be of
personal benefit to such individuals.
(3) All other compensation represents estimated annual Company 401(k) and ESOP
retirement contributions and in 1999 consists of $200 of 401(k) and $800 of
ESOP contributions for each of the Named Executive Officers, except for Mr.
Tutor.
19
<PAGE>
(4) Effective January 31, 1999, the former President and Chief Executive
Officer resigned from the Company. Since that date, David B. Perini and
Ronald N. Tutor shared the responsibilities of President and Chief
Executive Officer of the Company until the appointment of a new Chief
Executive Officer, Robert Band, effective May 12, 1999. Effective June 30,
1999, Mr. Perini retired from the Company and resigned his position as
Chairman. The Board of Directors appointed Mr. Tutor as Chairman effective
July 1, 1999. Effective March 29, 2000, the Board of Directors appointed
Mr. Tutor as Chairman and Chief Executive Officer and Mr. Band as President
and Chief Operating Officer.
(5) Represents a management services fee paid to Tutor-Saliba Corporation of
which Mr. Tutor is the Chairman, President, Chief Executive Officer and
sole stockholder. See "Certain Transactions" on pages 25 and 26.
(6) Represents consulting fees paid to Mr. Perini for services provided from
June 30, 1999, the effective date of Mr. Perini's retirement from the
Company, to December 31, 1999 at a monthly rate of $34,333 pursuant to an
Agreement that terminated on January 17, 2000 (see "Employment Agreement"
on page 25).
Stock Options
- -------------
The following table contains information concerning the stock options
granted during the year ended December 31, 1999 to the Company's Named Executive
Officers:
<TABLE>
<CAPTION>
Option Grants in the Last Fiscal Year (1)
Individual Grants
-------------------------------------------------------------------------------
Number of % of Total
Securities Options
Underlying Granted To Grant Date
Date of Options Employees In Exercise Expiration Present
Name Grant Granted (2) Fiscal Year Price (3) Date Value (4)
- ------------------------ ---------- ------------- -------------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Ronald N. Tutor 01/04/99 30,000 100.0% $ 5.13 01/03/2007 $ 75,600
Robert Band - - - - - -
Zohrab B. Marashlian - - - - - -
David B. Perini - - - - - -
Craig W. Shaw - - - - - -
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) No SARs were granted to any of the Named Executive Officers during the last
fiscal year.
(2) Options granted in 1999 become exercisable in two equal annual installments
on the second and third anniversary of the date of grant.
(3) The exercise price and tax withholding obligations related to exercise may
be paid by delivery of already owned shares or by offset of the underlying
shares, subject to certain conditions.
(4) The grant date present value was calculated using the Black-Scholes option
pricing model. All stock option valuation models, including the
Black-Scholes model, require a prediction about the future movement of the
Company's stock price based on past
20
<PAGE>
performance. The Company's use of this model should not be construed in any
way as an endorsement of its accuracy at valuing options or as a forecast
of the future performance of the Company's stock price. The following
assumptions were made for the purpose of calculating the Grant Date Present
Value: option term is eight years, volatility at 37.35%, dividend yield at
0% and interest rate at 4.82%. The real value of the options in this table
depends upon the actual performance of the Company's stock price during the
applicable period.
Option Exercises and Holdings
- -----------------------------
The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options during the year December
31, 1999 and unexercised options held as of December 31, 1999:
<TABLE>
<CAPTION>
Aggregated Option Exercises in the Last Fiscal Year
and Fiscal Year-End Option Values
Number of
Securities
Underlying
Shares
Acquired
on Value Number of Unexercised Options Value of Unexercised In-the-Money
Name Exercise Realized at Fiscal Year-End Options at Fiscal Year-End (1)
- ----------------------- ------------ ---------- --------------------------------- -----------------------------------
Exercisable Unexercisable Exercisable Unexercisable
-------------- --------------- ------------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Ronald N. Tutor - $ - - 225,000 $ - $ -
Robert Band - - 15,500 30,000 - -
Zohrab B. Marashlian - - 28,000 55,000 - -
David B. Perini - - 7,500 12,500 - -
Craig W. Shaw - - 28,000 55,000 - -
- -----------------------
</TABLE>
(1) At December 31, 1999, all options listed had exercise prices in excess of
the quoted market value.
Long-Term Performance Units
- ---------------------------
Under the Performance Unit award feature of the 1982 Long-Term Plan, key
employees may be contingently awarded a number of units which will be earned if
specified financial performance goals are attained. A Performance Unit will give
an employee the right to receive up to a maximum of 200% of the amount of the
Performance Unit (nominally valued at $100) at the end of a specified period
depending on the level of achievement of the specified financial performance
goals.
No awards were made under the terms of this Plan in 1997, 1998 and 1999 and
the Company has no current plans to award such Performance Units in the future.
21
<PAGE>
Pension Plan Disclosure
- -----------------------
The following table sets forth pension benefits payable based on an
employee's remuneration ("final average earnings") and "years of service" as
defined under the Company's non-contributory Retirement Plan (the "Plan") for
all its full-time employees and to the extent covered remuneration is limited by
the Internal Revenue Code of 1986, as amended, pension benefits payable have
been augmented based on the Company's Benefit Equalization Plan:
<TABLE>
<CAPTION>
Pension Plan Table -
Estimated Annual Pension Benefits (2) for
Years of Service Indicated (3)
-----------------------------------------------------------------------------
Remuneration (1) 15 Years 20 Years 25 Years 30 Years 35 Years
- ---------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$125,000 $ 24,406 $ 32,541 $ 40,676 $ 40,676 $ 40,676
150,000 30,031 40,041 50,051 50,051 50,051
175,000 35,656 47,541 59,426 59,426 59,426
200,000 41,281 55,041 68,801 68,801 68,801
225,000 46,906 62,541 78,176 78,176 78,176
250,000 52,531 70,041 87,551 87,551 87,551
300,000 63,781 85,041 106,301 106,301 106,301
400,000 86,281 115,041 143,801 143,801 143,801
500,000 108,781 145,041 181,301 181,301 181,301
________
</TABLE>
(1) Remuneration covered by the Plan and the Benefit Equalization Plan is
limited to an employee's annual salary and for the Named Executive Officers
is limited to the amounts in the Annual Salary column included in the
Summary Compensation Table on page 19.
(2) The estimated annual benefits are calculated on a straight-line annuity
basis and are not subject to any further deductions for Social Security
since the Plan formula integrates the calculation of the benefits with
certain adjustments for Social Security, as defined.
(3) The years of service for the Named Executive Officers are as follows: R.
Band (26 years), Z.B. Marashlian (27 years), D.B. Perini (37 years), and
C.W. Shaw (21 years).
22
<PAGE>
Performance Graph
- -----------------
Comparison of 5-year Cumulative Total Return
Among Perini Corporation, AMEX Market Value Index,
And Selected Construction and Real Estate Peer Groups
[GRAPHIC OMITTED]
- ---------------------------------------------------------------------------
1995 1996 1997 1998 1999
- ---------------------------------------------------------------------------
Perini $100 88 83 96 55 41
AMEX 100 129 136 164 161 201
Construction 100 152 170 210 318 214
Construction (Old Peer Group) 100 152 165 193 333 206
Real Estate (Old Peer Group) 100 120 164 211 187 170
- ---------------------------------------------------------------------------
The above graph compares the performance of Perini Corporation ("Perini")
with that of the American Stock Exchange Market Value Index ("AMEX") and
selected Construction and Real Estate Peer Groups. Companies in the Construction
Peer Group Index are as follows: EMCOR Group, Inc., Granite Construction, Inc.,
Meadow Valley Corporation and Morrison Knudsen Corporation. The companies which
comprise the Construction Peer Group Index have been changed from the preceding
fiscal year. BFC Construction Corp. and Turner Corporation which were included
in the preceding fiscal year's Construction Peer Group Index have since been
acquired by other companies. Therefore, the stock price information required to
complete the calculations for the graph is not available. EMCOR Group, Inc. and
Meadow Valley Corporation have been added to the Construction Peer Group Index
for the most recent fiscal year based upon the suggestion of an independent
financial advisory firm. In the preceding fiscal year, the performance of Perini
Corporation was also compared to a Real Estate Peer Group. For the most recent
fiscal year, this comparison was deemed inappropriate
23
<PAGE>
since Perini Corporation has discontinued its real estate development
operations. Companies included in the Real Estate Peer Group Index were as
follows: Newhall Land and Farming Company, AMREP Corporation, Major Realty
Corporation, Christiana Companies, Inc., Rouse Company and Mission West
Properties. During 1999, Major Realty Corporation and Christiana Companies, Inc.
were acquired by other companies. Therefore, the stock price information
required to complete the calculations for the graph is not available. In
accordance with Regulation S-K, Item 402(l)(4), the above graph includes a
comparison of the performance of Perini Corporation with the newly selected
Construction Peer Group Index as well as both the Construction Peer Group Index
and the Real Estate Peer Group Index used in the preceding fiscal year to the
extent possible.
The comparison of total return on investment (change in year end stock
price plus reinvested dividends) for each of the periods assumes that $100 was
invested on January 1, 1995, in each of Perini Corporation, the American Stock
Exchange Market Value Index and selected Construction and Real Estate Peer
Groups, with investment weighted on the basis of market capitalization.
24
<PAGE>
Directors' Compensation
- -----------------------
Fees for outside Directors of the Company currently consist of an annual
retainer fee of $16,000, plus $900 per Board meeting attended, as well as $900
per Committee meeting attended by members of the Audit, Compensation and
Nominating Committees, $4,000 per meeting attended by members of the Executive
Committee and $2,500 per meeting attended by members of the Special Committee.
Mr. Ronald N. Tutor, Chairman of the Company since July 1, 1999, has opted to
receive no Director fees since he is party to a Management Agreement described
in "Certain Transactions" below. During 1999, the Directors received payment of
their annual retainer fee of $16,000 in shares of the Company's Common Stock on
January 4, 1999. The number of shares was based on a price equivalent to the
fair market value, as defined, of prices prevailing on the American Stock
Exchange on the date issued and aggregated 3,121 shares of Common Stock for each
Director, except for Mr. Tutor and Mr. McCarron, the latter of which requested
that his fees be paid directly to the United Brotherhood of Carpenters Pension
Fund, a pension fund of which he is a Trustee. Effective June 30, 1999, David B.
Perini retired as an employee of the Company but remained as a Director of the
Company. Accordingly, Mr. Perini received a one-half year pro rated annual
retainer fee of $8,000 which was paid in 1,802 shares of the Company's Common
Stock on October 11, 1999. The number of shares issued was based on a price
equivalent to the fair market value, as defined, of prices prevailing on the
American Stock Exchange on the date issued. Meeting fees are paid on a quarterly
basis in cash.
Employment Agreement
- --------------------
In connection with the closing of the Series B Preferred Stock purchase
transaction on January 17, 1997, the Company entered into separate employment
agreement with David B. Perini. Under the terms of Mr. Perini's agreement, as
amended, Mr. Perini was to continue as Chairman of the Company for a period of
three years and was to receive his current salary which was to continue to be
reviewed by the Board, plus certain other benefits. During 1999, Mr. Perini
decided to retire as an employee of the Company and from his office as Chairman
of the Company and also to resign as Chairman of the Board of Directors
effective June 30, 1999. In connection with Mr. Perini's retirement, the
employment agreement referred to above was terminated effective June 30, 1999
and a new agreement between Mr. Perini and the Company was consummated whereby
Mr. Perini would provide non-exclusive consulting services, as required, to the
Company for the period from July 1, 1999 to January 17, 2000. During this
period, Mr. Perini received a monthly consulting fee equal to his monthly salary
as of his June 30, 1999 retirement date, as well as certain benefits, including
health and life insurance.
Certain Transactions
- --------------------
Effective with the issuance of the Series B Preferred Stock on January 17,
1997, the Company entered into an agreement with Tutor-Saliba Corporation
("TSC"), a California corporation engaged in the construction industry, and
Ronald N. Tutor, Chief Executive Officer and sole stockholder of TSC, to provide
certain management services, as defined. During 1999, the agreement between the
Company, TSC and Mr. Tutor was extended through December 31, 2000 under the same
basic terms and conditions as the initial agreement except that the amount of
the fee payable thereunder by the Company to TSC was increased effective January
1, 2000, from $150,000 to $250,000 per year. TSC initially held a 6.18% interest
in the Company's $1.00 par value Common Stock before TSC's additional investment
in the Company's Common Stock effective March 29, 2000 (see below) and currently
participates in joint ventures with the Company, the Company's share of which
contributed $8.6 million to the
25
<PAGE>
Company's consolidated revenues in 1999. Mr. Tutor was appointed as one of the
three new Directors in accordance with the terms of the Series B Preferred Stock
transaction, a member of the Executive Committee of the Board and, during 1997,
acting Chief Operating Officer of the Company. Effective January 1, 1998, Mr.
Tutor was appointed Vice Chairman of the Board of Directors and effective July
1, 1999 was elected Chairman of the Board of Directors. Compensation for the
management services consists of a monthly payment during 1999 of $12,500 to TSC
and options granted to Mr. Tutor in 1997 to purchase 150,000 shares of the
Company's $1.00 par value Common Stock at fair market value, as defined on the
date of grant. While these options vest immediately, they are not exercisable
until forty months from date of grant and expire after eight years. In addition,
on December 10, 1998, Mr. Tutor was granted options to purchase 45,000 shares
effective December 10, 1998, and 30,000 shares effective January 4, 1999, of the
Company's $1.00 par value Common Stock at fair market value, as defined, on the
effective dates of grant. The terms of these options, which expire eight years
from the date of grant, are generally similar to options granted on December 10,
1998 to other Executive Officers and other key employees under the 1982 Stock
Option Plan.
Effective March 29, 2000, subsequent to approval by the Company's
stockholders, a new investor group consisting of Tutor-Saliba Corporation (see
above), O&G Industries, Inc. ("O&G"), and National Union Fire Insurance Company
of Pittsburgh, Pa., a wholly-owned subsidiary of American International Group,
Inc. ("AIG"), purchased 9,411,765 shares of the Company's Common Stock for $40
million, or $4.25 per share. In connection therewith, the Company exchanged
7,490,417 shares of Common Stock for all of the outstanding shares of Series B
Cumulative Convertible Preferred Stock ("Series B Preferred Stock") at an
exchange price of $5.50 per share of Common Stock. (See "Ownership of Common
Stock by Directors and Officers" on pages 5 to 10 and "Certain Other Beneficial
Holders" on pages 12 and 13). Each of the new investors and two of the former
holders of the Series B Preferred Stock were entitled to appoint a member to the
Company's Board of Directors. O&G participates in joint ventures with the
Company, the Company's share of which contributed $4.2 million to the Company's
consolidated revenues in 1999. Payments to AIG for insurance and insurance
related services approximated $5.2 million in 1999.
At the meeting of the Board of Directors immediately following the
Stockholders' Meeting on March 29, 2000, the Board voted to adopt the Company's
Special Equity Incentive Plan (the "Plan") under which an aggregate of 3,000,000
shares of the Company's Common Stock, $1.00 par value, (the "Common Stock") may
be issued, subject to the approval thereof by the Stockholders of the Company at
the Annual Meeting scheduled to be held on May 25, 2000. In addition, the Board
appointed Mr. Tutor as Chairman and Chief Executive Officer and Mr. Band as
President and Chief Operating Officer at that time.
Also on March 29, 2000, the Compensation Committee granted options to
purchase shares of Common Stock, subject to approval of the Plan by the
Stockholders, to the following Named Executive Officers at an exercise price of
$4.50 per share (a price which is $.25 more than fair market value, as defined,
on the date of grant and $.25 above the price at which shares were sold to the
New Investors): Mr. Tutor (1,000,000 shares), Mr. Band (200,000 shares), Mr.
Marashlian (400,000 shares) and Mr. Shaw (400,000 shares). See description of
Plan and details of Options granted under 1B. "Approval of Special Equity
Incentive Plan" below.
The Company utilized the services of the law firm of Wilmer, Cutler &
Pickering (of which Michael R. Klein is a Partner), among other firms, during
the last fiscal year and it is anticipated that the Company will continue to do
so to a lesser extent during the current year.
26
<PAGE>
During 1999, the Company paid Wilmer, Cutler & Pickering approximately
$1,281,000 for legal services and related expenses.
1B. APPROVAL OF THE SPECIAL EQUITY INCENTIVE PLAN
Background
- ----------
For many years the Company has had in effect stock option plans for key
employees to provide an incentive in the form of a proprietary interest in the
Company to officers and other employees in a position to contribute materially
to the successful operation of the business of the Company. The Board of
Directors believes that stock options are an integral part of the total
compensation package required to attract and retain employees of outstanding
abilities. Generally, stock options ("Options") give the recipient (the
"Optionee") the right to purchase a specified number of shares of the Company's
Common Stock at a fixed price for a specified period of time.
The Company currently has only 220,110 shares of Common Stock remaining to
be granted under the existing 1982 Stock Option Plan. The Board of Directors
strongly believes that additional incentive in the form of a new stock option
plan is required to motivate and/or retain key members of management critical to
the profitable growth of the Company. Accordingly, the Board of Directors
approved the Special Equity Incentive Plan (the "Plan") on March 29, 2000 and
the Compensation Committee of the Board of Directors approved stock option
grants to the Named Executive Officers described below subject to stockholder
approval of the Plan.
The Board of Directors recommends a vote FOR the adoption of the Special
Equity Incentive Plan. The proposal must be approved by a majority of the votes
cast at the Annual Meeting.
General
- -------
The Plan provides that up to 3,000,000 shares of the Company's Common Stock
(as may be adjusted from time to time for recapitalizations, stock splits and
similar events) will be available for the granting of non-qualified stock
options ("NQO's")under the Plan to key executives, employees and directors of
the Company and its subsidiaries. The Plan requires that the exercise price
shall not be less than 100% of the fair market value on the date of the grant
and defines fair market value as the closing price on the American Stock
Exchange on the date of grant. Options must be exercised within 10 years of date
of grant or, if later, 10 years from the date stockholders approved the Plan.
The Administrator may provide that Options vest over time and may in its
discretion accelerate such vesting period.
Payment of the Option exercise price may be made in cash or, at the
election of the Administrator, by delivery of shares of the Company's Common
Stock equal in value to the Option exercise price, by a combination of cash and
stock, by a loan to the Optionee by the Company or by such other cashless
exercise method approved by the Administrator. In the event of termination of
employment, Options granted under the Plan will expire on the 30th day after the
date of termination or on the termination date if the Optionee was terminated
for cause as defined in such Optionee's employment or other agreement, or gross
misconduct as defined by the Plan (unless the Administrator specifies
otherwise). In the event of termination due to
27
<PAGE>
total disability or death, Options will expire one year after termination. In
case of death following termination of employment, the Options expire one year
after the date of death. In each case the expiration date may in no event be
later than ten years after the date of grant.
Upon a change in control as defined in the Plan, all Options granted
thereunder will become fully exercisable unless the Optionee's Option Agreement
provides otherwise. In addition, upon a substantial corporate change as
described in the Plan, unexercised Options terminate and the Administrator may
provide for them to be substituted for or assumed.
Tax Considerations
- ------------------
Tax Treatment of NQO's An Optionee realizes no taxable income when an NQO
is granted. Instead, the difference between the fair market value of the Common
Stock subject to an NQO and the exercise price is taxed as ordinary compensation
income on or after the date on which the NQO is exercised. The difference is
measured and taxed as of the date of exercise. The Optionee's tax basis is
increased by the amount of such taxable income.
The Corporation receives no tax deduction on the grant of an NQO, but is
entitled to a tax deduction when the Optionee recognizes taxable income on or
after exercise of the NQO, in the same amount as the income recognized by the
Optionee.
Exercise by Delivery of Stock Special rules apply if an Optionee surrenders
shares of Common Stock in payment of the exercise price of an NQO.
Parachute Payments The exercise of any portion of any option that is
accelerated due to the occurrence of a change of control may cause a portion of
the payments with respect to such accelerated Options to be treated as
"parachute payments" as defined in the Code. Any such parachute payments may be
non-deductible to the Corporation, in whole or in part, and may subject the
recipient to a non-deductible 20% federal excise tax on all or a portion of such
payment (in addition to other taxes ordinarily payable).
Limitation on Corporation's Deductions As a result of Section 162(m) of the
Code, the Corporation's federal tax deduction for certain awards under the Plan
may be limited to the extent that the Chief Executive Officer or other executive
officer whose compensation is required to be reported in the summary
compensation table receives compensation (other than performance-based
compensation) in excess of $1 million a year.
Administration
- --------------
Under the terms of the Plan, the Compensation Committee or other committee
designated by the Board of Directors will be the Plan Administrator. The
Administrator will be responsible for the general operation and administration
of the Plan and has full discretion to interpret and administer the provisions
of the Plan. Subject to the terms of the Plan, the Administrator will, in its
sole discretion, determine (i) the persons who receive Options, (ii) terms of
such Options, (iii) the schedule for exercisability (including any requirements
that the Optionee or the Company satisfy performance criteria), (iv) the time
and expiration of such Options and (v) the form of payment due upon exercise.
Other powers of the Administrator will include, but not be limited to, the power
to amend or extend any provision or limitation of any Option.
28
<PAGE>
Stock Options Granted
- ---------------------
The following table contains information concerning the stock options
granted on March 29, 2000 to the Company's current Named Executive Officers:
<TABLE>
<CAPTION>
Special Equity Incentive Plan
----------------------------------------------------------------
Number of Securities
Underlying Options Exercise Expiration
Name and Position Granted (1) Price (2)(4) Date
- -------------------------------------- --------------------------- --------------- --------------
<S> <C> <C> <C>
Ronald N. Tutor 1,000,000 $4.50 3-28-2010
Chairman and Chief Executive Officer
Robert Band 200,000 $4.50 3-28-2010
President and Chief Operating Officer
Zohrab B. Marashlian 400,000 $4.50 3-28-2010
President, Perini Civil Construction
Craig W. Shaw 400,000 $4.50 3-28-2010
President, Perini Building Company,
Inc.
All Current Named Executive Officers 2,000,000
as a Group (3)
</TABLE>
(1) These Options become exerciseable in three equal installments, on the date
of grant and on the first and second anniversary of the date of grant.
(2) The exercise price was determined to be $4.50 per share which is $.25 per
share above the price at which shares were sold to the New Investors and
also $.25 above fair market value on the date of grant. When exercising an
Option or a portion thereof, the Optionee must pay the full exercise price
in cash or, at the election of the Administrator, another form of payment
which could include loans from the Company or use of the Company's Common
Stock previously owned by the Optionee. Vested Options could be exercised
by any Optionee who voluntarily left the Company before March 29, 2002 for
cash within 30 days of termination or an Optionee who was terminated for
cause for cash at date of termination; while any unvested Options would be
cancelled.
(3) Except for the current Named Executive Officers, there weren't any Options
granted to current directors, nominee for election as a director or any
employee, including all current officers who are not the Current Named
Executive Officers.
(4) The closing price of the Company's Common Stock on the American Stock
Exchange on April 6, 2000 was $4.25 per share.
29
<PAGE>
1C.
RATIFICATION OF APPOINTMENT OF AUDITORS
Upon recommendation of the Audit Committee, the Board has appointed the
firm of Arthur Andersen LLP, independent public accountants, as its auditors for
the fiscal year ending December 31, 2000. Although stockholder ratification is
not required, the Board has determined that it would be desirable to request an
expression from the stockholders as to whether or not they concur with the
foregoing appointment.
Arthur Andersen LLP has audited the accounts of the Company and its
subsidiaries since 1960. Representatives of Arthur Andersen LLP will be present
at the Annual Meeting of Stockholders of the Company and will be available to
respond to appropriate questions and to make a statement if they desire to do
so.
The Board recommends a vote FOR ratification of the appointment of Arthur
Andersen LLP as independent auditors for the Company for the fiscal year ending
December 31, 2000.
1D.
OTHER MATTERS
Except for the election of the Preferred Directors discussed on pages 1
through 4 and elsewhere in this Proxy Statement, the Board of Directors knows of
no other matters which are likely to be brought before the meeting. However, if
any other matters, of which the Board of Directors is not aware, are presented
to the meeting for action, it is the intention of the persons named in the
accompanying form of proxy to vote said proxy in accordance with their judgement
on such matters.
The Company will bear the cost of solicitation of proxies. The solicitation
of proxies by mail may be followed by telephone or oral solicitation of certain
stockholders and brokers.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, STOCKHOLDERS ARE
URGED TO FILL IN, SIGN, DATE AND RETURN THE ACCOMPANYING FORM OF PROXY IN THE
ENCLOSED POSTAGE-PREPAID ENVELOPE.
By order of the Board of Directors,
Dennis M. Ryan, Secretary
Framingham, Massachusetts
April 19, 2000
30
<PAGE>
Exhibit A
PERINI CORPORATION
Special Equity Incentive Plan
Purpose
- -------
Perini Corporation, a Massachusetts corporation (the "Company"), wishes to
provide special incentives for key executives, other employees, and directors.
To further these objectives, the Company hereby sets forth the Perini
Corporation Special Equity Incentive Plan (the "Plan"), effective as of May 25,
2000 (the "Effective Date"), to provide options ("Options") to key executives,
employees, and directors of the Company and its subsidiaries to purchase shares
of the Company's common stock $1.00 par value (the "Common Stock").
Participants
- ------------
Eligible persons become "optionees" when the Administrator grants them an option
under this Plan. The term optionee also includes, where appropriate, a person
authorized to exercise an Option in place of the original recipient.
Administrator
- -------------
The Administrator will be the Compensation Committee of the Board of Directors,
unless the Board specifies another committee of the Board, but the Board may
still act under the Plan as though it were the Compensation Committee.
The Administrator is responsible for the general operation and administration of
the Plan and for carrying out its provisions and has full discretion in
interpreting and administering the provisions of the Plan. Subject to the
express provisions of the Plan, the Administrator may exercise such powers and
authority of the Board as the Administrator may find necessary or appropriate to
carry out its functions. The Administrator may delegate its functions (other
than those described in the Granting of Options section) to officers or other
employees of the Company.
The Administrator's powers will include, but not be limited to, the power to
amend, waive, or extend any provision or limitation of any Option. The
Administrator may act through meetings of a majority of its members or by
unanimous consent.
Perini Corporation
Special Equity Incentive Plan
Page 1 of 15
<PAGE>
Granting Of Options
- -------------------
Subject to the terms of the Plan, the Administrator will, in its sole
discretion, determine
the persons who receive Options,
the terms of such Options,
the schedule for exercisability (including any requirements that the
optionee or the Company satisfy performance criteria),
the time and conditions for expiration of the Option, and
the form of payment due upon exercise.
The Administrator's determinations under the Plan need not be uniform and
need not consider whether possible recipients are similarly situated.
Options granted will not be "incentive stock options" ("ISOs") within the
meaning of Section 422 of the Internal Revenue Code of 1986 (the "Code"),
but will be nonqualified stock options ("NQSOs").
Substitutions
The Administrator may grant Options in substitution for options or
other equity interests held by individuals who become employees of the
Company or of an Eligible Subsidiary as a result of the Company's or
Subsidiary's acquiring or merging with the individual's employer or
acquiring its assets. In addition, the Administrator may provide for
the Plan's assumption of options granted outside the Plan to persons
who would have been eligible under the terms of the Plan to receive a
grant, including both persons who provided services to any acquired
company or business and persons who provided services to the Company
or any Subsidiary. If necessary to conform the Options to the
interests for which they are substitutes, the Administrator may grant
substitute Options under terms and conditions that vary from those the
Plan otherwise requires.
Date Of Grant
- -------------
The Date of Grant will be the date as of which the Administrator grants an
Option to a participant, as specified in the Administrator's minutes.
Perini Corporation
Special Equity Incentive Plan
Page 2 of 15
<PAGE>
Exercise Price
- --------------
The Exercise Price is the value of the consideration that an optionee must
provide in exchange for one share of Common Stock. The Administrator will
determine the Exercise Price under each Option and may set the Exercise Price
without regard to the Exercise Price of any other Options granted at the same or
any other time. The Company may use the consideration it receives from the
optionee for general corporate purposes.
The Exercise Price per share may not be less than 100% of the Fair Market Value
of a share on the Date of Grant.
Fair Market Value
Fair Market Value of a share of Common Stock for purposes of the Plan
will be determined as follows:
if the Company has no publicly-traded stock, the Administrator
will determine the Fair Market Value for purposes of the Plan
using any measure of value it determines in good faith to be
appropriate;
if the Common Stock trades on a national securities exchange, the
closing sale price on that date;
if the Common Stock does not trade on any such exchange, the
closing sale price as reported by the National Association of
Securities Dealers, Inc. Automated Quotation System ("Nasdaq")
for such date;
if no such closing sale price information is available, the
average of the closing bid and asked prices that Nasdaq reports
for such date; or
if there are no such closing bid and asked prices, the average of
the closing bid and asked prices as reported by any other
commercial service for such date.
For any date that is not a trading day, the Fair Market Value of a
share of Common Stock for such date will be determined by using the
closing sale price or the average of the closing bid and asked prices,
as appropriate, for the immediately preceding trading day. The
Administrator can substitute a particular time of day or other measure
of "closing sale price" if appropriate because of changes in exchange
or market procedures.
Perini Corporation
Special Equity Incentive Plan
Page 3 of 15
<PAGE>
Exercisability
- --------------
The Administrator will determine the times and conditions for exercise of each
Option.
Options will become exercisable at such times and in such manner as the
Administrator determines and the Option Agreement indicates; provided, however,
that the Administrator may, on such terms and conditions as it determines
appropriate, accelerate the time at which the optionee may exercise any portion
of an Option.
No portion of an Option that is unexercisable at an optionee's termination of
employment will thereafter become exercisable, unless the Option Agreement
provides otherwise, either initially or by amendment.
Change Of Control
Upon a Change of Control (as defined below), all Options will become
fully exercisable, unless the optionee's Option Agreement provides
otherwise. A Change of Control for this purpose means the occurrence
of any one or more of the following events:
(i) sale of all or substantially all of the assets of the Company
to one or more individuals, entities, or groups (other than an
"Excluded Owner" as defined below);
(ii) complete or substantially complete dissolution or
liquidation of the Company;
(iii) a person, entity, or group (other than an Excluded Owner)
acquires or attains ownership of at least 60% of the undiluted
total voting power of the Company's then-outstanding securities
eligible to vote to elect members of the Board ("Company Voting
Securities");
(iv) completion of a merger or consolidation of the Company with
or into any other entity (other than an Excluded Owner) unless
the holders of the Company Voting Securities outstanding
immediately before such completion, together with any trustee or
other fiduciary holding securities under a Company benefit plan,
hold securities that represent immediately after such merger or
consolidation more than 40% of the combined voting power of the
then outstanding voting securities of either the Company or the
other surviving entity or its ultimate parent
Perini Corporation
Special Equity Incentive Plan
Page 4 of 15
<PAGE>
(v) the individuals who constitute the Board immediately before a
proxy contest cease to constitute at least a majority of the
Board (excluding any Board seat that is vacant or otherwise
unoccupied) immediately following the proxy contest; or
(vi) during any two year period, the individuals who constitute
the Board at the beginning of the period (the "Incumbent
Directors") cease for any reason to constitute at least a
majority of the Board (excluding any Board seat that is vacant or
otherwise unoccupied), provided that any individuals that a
majority of Incumbent Directors approve for service on the Board
are treated as Incumbent Directors.
An "Excluded Owner" consists of the Company, any Company Subsidiary,
any Company benefit plan, or any underwriter temporarily holding
securities for an offering of such securities.
Even if other tests are met, a Change of Control has not occurred
under any circumstance in which the Company files for bankruptcy
protection or is reorganized following a bankruptcy filing. In
addition, the acceleration will not occur if it would prevent use of
"pooling of interest" accounting for a reorganization, merger, or
consolidation of the Company that the Board approves.
The Administrator may allow conditional exercises in advance of the
completion of a Change of Control that are then rescinded if no Change
of Control occurs.
Substantial Corporate Change
Upon a Change of Control that is also a Substantial Corporate Change,
the Options will become exercisable (unless the Change of Control
section provides otherwise) and the Plan and any unexercised Options
will terminate (after the occurrence of one of the alternatives set
forth in the next full paragraph) unless either (i) such termination
would prevent use of "pooling of interest" accounting for a
reorganization, merger, or consolidation of the Company that the Board
approves or (ii) provision is made in writing in connection with such
transaction for the assumption or continuation of outstanding Options,
or
Perini Corporation
Special Equity Incentive Plan
Page 5 of 15
<PAGE>
the substitution for such options or grants of any options or grants
covering the stock or securities of a successor employer entity, or a
parent or subsidiary of such successor, with appropriate adjustments
as to the number and kind of shares of stock and prices, in which
event the Options will continue in the manner and under the terms so
provided.
If an Option would otherwise terminate under the preceding sentence and the
Fair Market Value of the Common Stock as a result of the Substantial
Corporate Change exceeds or is likely to exceed the Exercise Price, the
Administrator will either provide that
optionees will have the right, at such time before the completion of
the transaction causing such termination as the Board or the
Administrator reasonably designates, to exercise any unexercised
portions of the Option, including those portions that the Change of
Control will make exercisable or
cause the Company, or agree to allow the successor, to cancel each
Option after payment to the optionee of an amount in cash, cash
equivalents, or successor equity interests substantially equal to the
Fair Market Value under the transaction minus the Exercise Price for
the shares covered by the Option (and, where the Board or
Administrator determines it is appropriate, any required tax
withholdings).
The Administrator may allow conditional exercises in advance of the
completion of a Substantial Corporate Change that are then rescinded if no
Substantial Corporate Change occurs.
The Board or other Administrator may take any actions described in the
Substantial Corporate Changes section, without any requirement to seek
optionee consent.
A Substantial Corporate Change means any of the following events:
a sale as described in clause (i) under Change of Control,
Perini Corporation
Special Equity Incentive Plan
Page 6 of 15
<PAGE>
a dissolution or liquidation as described in clause (ii),
an ownership change as described in clause (iii), but with the
percentage ownership increased to 100%,
completion of a merger, consolidation, or reorganization of the
Company with one or more corporations or other entities in which the
Company is not the surviving entity, or
any other transaction (including a merger or reorganization in which
the Company survives) approved by the Board that results in any person
or entity (other than an Excluded Owner) owning 100% of Company Voting
Securities.
Method of Exercise
- ------------------
To exercise any exercisable portion of an Option, the optionee must:
Deliver notice of exercise to the Secretary of the Company (or to whomever
the Administrator designates), in a form complying with any rules the
Administrator may issue, signed or otherwise authenticated by the optionee,
and specifying the number of shares of Common Stock underlying the portion
of the Option the optionee is exercising;
Pay the full Exercise Price by cash or a cashier's or certified check for
the shares of Common Stock with respect to which the Option is being
exercised, unless the Administrator consents to another form of payment
(which could include loans from the Company or the use of Common Stock);
and
Deliver to the Administrator such representations and documents as the
Administrator, in its sole discretion, may consider necessary or advisable.
Payment in full of the Exercise Price need not accompany the written notice of
exercise if the exercise complies with a previously-approved cashless exercise
method, including, for example, that the notice directs that the stock
certificates (or other indicia of ownership) for the shares issued upon the
exercise be delivered to a licensed broker acceptable to the Company as the
agent for the individual exercising the option and at the time the stock
certificates (or other indicia) are delivered to the broker, the
Perini Corporation
Special Equity Incentive Plan
Page 7 of 15
<PAGE>
broker will tender to the Company cash or cash equivalents acceptable to the
Company and equal to the Exercise Price and any required withholding taxes. The
Administrator may provide that cashless exercise is available only while an
optionee remains employed by the Company.
If the Administrator agrees to allow an optionee to pay through tendering shares
of Common Stock to the Company, the individual can only tender stock he has held
for at least six months at the time of surrender. Shares of stock offered as
payment will be valued, for purposes of determining the extent to which the
optionee has paid the Exercise Price, at their Fair Market Value on the date of
exercise. The Administrator may also, in its discretion, accept attestation of
ownership of Common Stock and issue a net number of shares upon Option exercise,
or by having a broker tender to the Company cash equal to the exercise price and
any withholding taxes.
Option Expiration
- -----------------
No one may exercise an Option more than ten years after its Date of Grant or, if
later, ten years after the date of initial stockholder approval of the Plan.
Unless the Option Agreement provides otherwise, either initially or by
amendment, no one may exercise an Option after the first to occur of:
Employment Termination
The 30th day after the date of termination of employment (other than
for death or Disability), where termination of employment means the
time when the employer-employee or other service-providing
relationship between the employee and the Company ends for any reason.
Termination of employment also includes the Eligible Subsidiary's
ceasing to be a subsidiary of the Company. The Administrator may
provide that Options terminate immediately upon termination of
employment for "cause" under an employee's employment or consultant's
services agreement or under another definition specified in the Option
Agreement. Unless the Option Agreement provides otherwise, termination
of employment does not include instances in which the Company
immediately rehires a common law employee as an independent
contractor. The Administrator, in its sole discretion, will determine
all questions of whether particular terminations or leaves of absence
are terminations of employment.
Gross Misconduct
For the Company's termination of the optionee's employment as a result
of the optionee's Gross Misconduct,
Perini Corporation
Special Equity Incentive Plan
Page 8 of 15
<PAGE>
the time of such termination. For purposes of this Plan, "Gross
Misconduct" means the optionee has
committed fraud, misappropriation, embezzlement, or willful
misconduct that has resulted or is likely to result in material
harm to the Company;
committed or been indicted for or convicted of, or pled guilty or
no contest to, any misdemeanor (other than for minor infractions
or traffic violations) involving fraud, breach of trust,
misappropriation, or other similar activity, or any felony; or
committed an act of gross negligence or otherwise acted with
willful disregard for the Company's best interests in a manner
that has resulted or is likely to result in material harm to the
Company.
If the optionee has a written employment agreement in effect at
the time of his termination that specifies "cause" for
termination, "Gross Misconduct" for purposes of his termination
will refer to "cause" under the employment agreement, rather than
to the foregoing definition.
Disability
For disability, the earlier of (i) the first anniversary of the
optionee's termination of employment for disability and (ii) 60 days
after the optionee no longer has a disability, where "disability"
means the inability to engage in any substantial gainful activity
because of any medically determinable physical or mental impairment
that can be expected to result in death or that has lasted or can be
expected to last for a continuous period of not less than 12 months;
or
Death
The date 12 months after the optionee's death.
If exercise is permitted after termination of employment, the Option will
nevertheless expire as of the date that the former service provider
violates any covenant not to compete or other post-employment covenant in
effect between the Company and the former service provider.
Nothing in this Plan extends the term of an Option beyond the tenth
anniversary of its Date of Grant, nor does anything in this Option
Expiration section make an Option exercisable that has not otherwise become
exercisable, unless the Administrator specifies otherwise.
Perini Corporation
Special Equity Incentive Plan
Page 9 of 15
<PAGE>
Option Agreement
- ----------------
Option Agreements (which could be certificates) will set forth the terms of each
Option and will include such terms and conditions, consistent with the Plan, as
the Administrator may determine are necessary or advisable. To the extent the
agreement is inconsistent with the Plan, the Plan will govern. The Option
Agreements may contain special rules.
Stock Subject To Plan
- ---------------------
Except as adjusted below under Adjustments Upon Changes In Capital Stock,
the aggregate number of shares of Common Stock that may be subject to
outstanding Options may not exceed 3 million shares of Common Stock, and
the maximum number of shares that may be granted under Options for a single
individual in a calendar year may not exceed 1 million shares of Common
Stock.
The Common Stock will come from either authorized but unissued shares or from
previously issued shares that the Company reacquires, including shares it
purchases on the open market or holds as treasury shares. If any Option expires,
is canceled, or terminates for any other reason, the shares of Common Stock
available under that Option will again be available for the granting of new
Options (but will be counted against that calendar year's limit for a given
individual).
No adjustment will be made for a dividend or other right for which the record
date precedes the date of exercise.
The optionee will have no rights of a stockholder with respect to the shares of
stock subject to an Option except to the extent that the Company has issued
certificates for, or otherwise confirmed ownership of, such shares upon the
exercise of the Option.
The Company will not issue fractional shares pursuant to the exercise of an
Option, unless the Administrator determines otherwise, but the Administrator
may, in its discretion, direct the Company to make a cash payment in lieu of
fractional shares.
Person Who May Exercise
- -----------------------
During the optionee's lifetime and except as provided under Transfers,
Assignments, and Pledges, only the optionee or his duly appointed guardian or
personal representative may exercise the Options. After his death, his personal
representative or any other person authorized under a will or under the laws of
descent and distribution may exercise any then exercisable portion of an Option.
If someone other than the original recipient seeks to exercise any portion of an
Option, the Administrator may request
Perini Corporation
Special Equity Incentive Plan
Page 10 of 15
<PAGE>
such proof as it may consider necessary or appropriate of the person's right to
exercise the Option.
Adjustments Upon Changes In Capital Stock
- -----------------------------------------
Subject to any required action by the Company (which it agrees to promptly take)
or its stockholders, and subject to the provisions of applicable corporate law,
if, after the date of initial stockholder approval of the Plan,
the outstanding shares of Common Stock increase or decrease or change into
or are exchanged for a different number or kind of security because of any
recapitalization, reclassification, stock split, reverse stock split,
combination of shares, exchange of shares, stock dividend, or other
distribution payable in capital stock, or
some other increase or decrease in such Common Stock occurs without the
Company's receiving consideration (excluding, unless the Administrator
determines otherwise, stock repurchases),
the Administrator must make a proportionate and appropriate adjustment in the
number of shares of Common Stock underlying each Option, so that the
proportionate interest of the optionee immediately following such event will, to
the extent practicable, be the same as immediately before such event. (This
adjustment does not apply to Common Stock that the optionee has already
purchased.) Unless the Administrator determines another method would be
appropriate, any such adjustment to an Option will not change the total price
with respect to shares of Common Stock underlying the unexercised portion of the
Option but will include a corresponding proportionate adjustment in the Option's
Exercise Price. The Board or other Administrator may take any actions described
in the Adjustments upon Changes in Capital Stock section without any requirement
to seek optionee consent.
The Administrator will make a commensurate change to the maximum number and kind
of shares provided in the Stock Subject to Plan section.
Any issue by the Company of any class of preferred stock, or securities
convertible into shares of common or preferred stock of any class, will not
affect, and no adjustment by reason thereof will be made with respect to, the
number of shares of Common Stock subject to any Option or the Exercise Price
except as this Adjustments section specifically provides. The grant of an Option
under the Plan will not affect in any way the right or power of the
Perini Corporation
Special Equity Incentive Plan
Page 11 of 15
<PAGE>
Company to make adjustments, reclassifications, reorganizations or changes of
its capital or business structure, or to merge or to consolidate, or to
dissolve, liquidate, sell, or transfer all or any part of its business or
assets.
Subsidiary Employees
- --------------------
Employees of Company Subsidiaries will be entitled to participate in the Plan,
except as otherwise designated by the Board of Directors or the Administrator.
"Eligible Subsidiary" means each of the Company's Subsidiaries, except as the
Administrator otherwise specifies. "Subsidiary" means any corporation (other
than the Company) in an unbroken chain of corporations beginning with the
Company if, at the time an Option is granted to a Participant under the Plan,
each corporation (other than the last corporation in the unbroken chain) owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in another corporation in such chain. Subsidiary also includes a
single-member limited liability company included within the chain described in
the preceding sentence. The Board or the Administrator may use a different
definition of Subsidiary and may include other forms of entity within the
definition.
Legal Compliance
- ----------------
The Company will not issue any shares of Common Stock under an Option until all
applicable requirements imposed by Federal and state securities and other laws,
rules, and regulations, and by any applicable regulatory agencies or stock
exchanges, have been fully met. To that end, the Company may require the
optionee to take any reasonable action to comply with such requirements before
issuing such shares. No provision in the Plan or action taken under it
authorizes any action that Federal or state laws otherwise prohibit.
The Plan is intended to conform to the extent necessary with all provisions of
the Securities Act of 1933 ("Securities Act") and the Securities Exchange Act of
1934 and all regulations and rules the Securities and Exchange Commission issues
under those laws. Notwithstanding anything in the Plan to the contrary, the
Administrator must administer the Plan, and Options may be granted and
exercised, only in a way that conforms to such laws, rules, and regulations. To
the extent permitted by applicable law, the Plan and any Options will be treated
as amended to the extent necessary to conform to such laws, rules, and
regulations.
Perini Corporation
Special Equity Incentive Plan
Page 12 of 15
<PAGE>
Purchase For Investment And Other Restrictions
- ----------------------------------------------
Unless a registration statement under the Securities Act covers the share of
Common Stock an optionee receives upon exercising his Option, the Administrator
may require, at the time of such exercise, that the optionee agree in writing to
acquire such shares for investment and not for public resale or distribution,
unless and until the shares subject to the Option are registered under the
Securities Act. Unless the shares are registered under the Securities Act, the
optionee must acknowledge:
that the shares purchased on exercise of the Option are not so registered,
that the optionee may not sell or otherwise transfer the shares unless
such sale or transfer complies with all applicable laws, rules, and
regulations, including all applicable Federal and state securities
laws, rules, and regulations, and either
the shares have been registered under the Securities Act in connection
with the sale or transfer thereof, or
counsel satisfactory to the Company has issued an opinion satisfactory
to the Company that the sale or other transfer of such shares is
exempt from registration under the Securities Act.
Additionally, the Common Stock, when issued upon the exercise of an Option, will
be subject to any other transfer restrictions, rights of first refusal, and
rights of repurchase set forth in or incorporated by reference into other
applicable documents, including the Option Agreements, or the Company's articles
or certificate of incorporation, by-laws, or generally applicable stockholders'
agreements.
The Administrator may, in its sole discretion, take whatever additional actions
it deems appropriate to comply with such restrictions and applicable laws,
including placing legends on certificates and issuing stop- transfer orders to
transfer agents and registrars.
Tax Withholding
- ---------------
The optionee must satisfy all applicable Federal, state, and local income and
employment tax withholding requirements before the Company will deliver stock
certificates or otherwise recognize ownership upon the exercise of an Option.
The Company may
Perini Corporation
Special Equity Incentive Plan
Page 13 of 15
<PAGE>
decide to satisfy the withholding obligations through additional withholding on
salary or wages. If the Company does not or cannot withhold from other
compensation, the optionee must pay the Company, with a cashier's check or
certified check, the full amounts, if any, required for withholding. Payment of
withholding obligations is due at the same time as is payment of the Exercise
Price. If the Administrator so determines, the optionee may instead satisfy the
withholding obligations by directing the Company to retain shares from the
Option exercise, by tendering previously owned shares, or by attesting to his
ownership of shares (with the distribution of net shares), or by having a broker
tender to the Company cash equal to the withholding taxes.
Transfers, Assignments And Pledges
- ----------------------------------
Unless the Administrator otherwise approves in advance in writing for estate
planning or other purposes, an Option may not be assigned, pledged or otherwise
transferred in any way, whether by operation of law or otherwise or through any
legal or equitable proceedings (including bankruptcy), by the optionee to any
person, except by will or by operation of applicable laws of descent and
distribution. If necessary to comply with Rule 16b-3, the optionee may not
transfer or pledge shares of Common Stock acquired upon exercise of an Option
until at least six months have elapsed from (but excluding) the Date of Grant,
unless the Administrator approves otherwise in advance in writing. The
Administrator may, in its discretion, expressly provide that an optionee may
transfer his Option, without receiving consideration, to (i) members of his
immediate family (children, grandchildren, or spouse), (ii) trusts for the
benefit of such family members, or (iii) partnerships whose only partners are
such family members.
Amendment or Termination of Plan and Options
- --------------------------------------------
The Board may amend, suspend, or terminate the Plan at any time, without the
consent of the optionees or their beneficiaries; provided, however, that such
actions are consistent with this section. Except as required by law or by the
Substantial Corporate Changes section, the Administrator may not, without the
optionee's or beneficiary's consent, modify the terms and conditions of an
Option so as to materially adversely affect the optionee. No amendment,
suspension, or termination of the Plan will, without the optionee's or
beneficiary's consent, terminate or materially adversely affect any right or
obligations under any outstanding Options, except as provided in the Substantial
Corporate Changes Section.
Perini Corporation
Special Equity Incentive Plan
Page 14 of 15
<PAGE>
Privileges of Stock Ownership
- -----------------------------
No optionee and no beneficiary or other person claiming under or through such
optionee will have any right, title, or interest in or to any shares of Common
Stock allocated or reserved under the Plan or subject to any Option except as to
such shares of Common Stock, if any, already issued to such optionee.
Effect on Other Plans
- ---------------------
Whether exercising an Option causes the optionee to accrue or receive additional
benefits under any pension or other plan is governed solely by the terms of such
other plan.
Limitations on Liability
- ------------------------
Notwithstanding any other provisions of the Plan, no individual acting as a
director, officer, other employee, or agent of the Company will be liable to any
optionee, former optionee, spouse, beneficiary, or any other person for any
claim, loss, liability, or expense incurred in connection with the Plan, nor
will such individual be personally liable because of any contract or other
instrument he executes in such other capacity. The Company will indemnify and
hold harmless each director, officer, other employee, or agent of the Company to
whom any duty or power relating to the administration or interpretation of the
Plan has been or will be delegated, against any cost or expense (including
attorneys' fees) or liability (including any sum paid in settlement of a claim
with the Board's approval) arising out of any act or omission to act concerning
this Plan unless arising out of such person's own fraud or bad faith.
No Employment Contract
- ----------------------
Nothing contained in this Plan constitutes an employment contract between the
Company and the optionees. The Plan does not give any optionee any right to be
retained in the Company's employ, nor does it enlarge or diminish the Company's
right to end the optionee's employment or other relationship with the Company.
Applicable Law
- --------------
The laws of the Commonwealth of Massachusetts (other than its choice of law
provisions) govern this Plan and its interpretation.
Duration of Plan
- ----------------
Unless the Board extends the Plan's term, the Administrator may not grant
Options after May 25, 2010. The Plan will then terminate but will continue to
govern unexercised and unexpired Options.
Approval of The Plan
- --------------------
The Plan must be submitted to Company stockholders for their approval within 12
months after the Board adopts the Plan. If the stockholders do not so approve
the Plan, the Plan and any outstanding Options will be treated as void and of no
effect.
Perini Corporation
Special Equity Incentive Plan
Page 15 of 15
<PAGE>
PERINI CORPORATION
COMMON STOCK
CONTROL NUMBER:
RECORD DATE SHARES:
The Board of Directors recommends a vote "FOR" proposals A, B and C.
A. The election of three (3) Class I Directors as described in the proxy
statement of the Board of Directors to serve until the 2003 Annual Meeting.
(01) Robert Band
(02) Michael R. Klein
(03) Christopher H. Lee
If you do not wish your shares voted "For" a particular nominee, mark the
"For All Except" box and strike a line through the nominee(s) name(s). Your
shares will be voted "For" the remaining nominee(s)
FOR ALL NOMINEES WITHHOLD FOR ALL EXCEPT
B. To approve the Special Equity Incentive Plan as described in the proxy
statement of the Board of Directors.
FOR AGAINST ABSTAIN
C. To ratify the appointment of Arthur Andersen LLP as auditors for the fiscal
year ending December 31, 2000.
FOR AGAINST ABSTAIN
D. To transact such other business as may properly come before the meeting or
any adjournment or adjournments thereof.
Mark box at right if an address change or comment has been noted on the reverse
side of this card.
Please be sure to sign and date this Proxy.
Date
_____________________________________
Stockholder sign here
_____________________________________
Co-owner sign here
<PAGE>
PROXY SOLICITED BY THE BOARD OF DIRECTORS OF
PERINI CORPORATON
FOR THE ANNUAL MEETING OF STOCKHOLDERS - MAY 25, 2000
The undersigned hereby appoints Robert Band and Dennis M. Ryan and each of them
as Proxies of the undersigned, with full power of substitution, and authorizes
each of them to represent and to vote all shares of Common Stock, $1.00 par
value per share, of Perini Corporation held by the undersigned at the close of
business on April 3, 2000, at the Annual Meeting of Stockholders to be held at
the Crowne Plaza, Hawthorne Ballroon, 1360 Worcester Road, (Route 9 East),
Natick, Massachusetts, on Thursday, May 25, 2000 at 9:00 a.m. or at any
adjournments or postponements thereof.
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER(S). A FAILURE TO VOTE OR A VOTE TO ABSTAIN WILL
HAVE THE SAME LEGAL EFFECT AS A VOTE AGAINST ANY OF THE PROPOSALS. IF NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED "FOR" PROPOSAL A, THE ELECTION OF
DIRECTORS AS SET FORTH HEREIN, "FOR" PROPOSAL B, TO APPROVE THE SPECIAL EQUITY
INCENTIVE PLAN, AND "FOR" PROPOSAL C, TO RATIFY THE APPOINTMENT OF ARTHUR
ANDERSEN LLP AS AUDITORS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2000. THE
PROXIES ARE EACH AUTHORIZED TO VOTE IN THEIR DISCRETION ON SUCH OTHER BUSINESS
AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS
THEREOF. A STOCKHOLDER WISHING TO VOTE IN ACCORDANCE WITH THE BOARD OF
DIRECTORS' RECOMMENDATION NEED ONLY SIGN AND DATE THIS PROXY AND RETURN IT IN
THE POSTAGE-PAID ENVELOPE PROVIDED.
PLEASE VOTE, DATE AND SIGN ON REVERSE SIDE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
Please sign exactly as your name appears on this card. If stock is held in
the name of more than one person, all holders should sign. When signing as
an attorney, administrator, executor, guardian or trustee, please add your
title as such. If executed by a corporation, the proxy should be signed by
a duly authorized person, stating his or her title or authority.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
_______________________________ __________________________________
_______________________________ ___________________________________
<PAGE>
PERINI CORPORATION
PREFERRED STOCK
CONTROL NUMBER:
RECORD DATE SHARES:
ELECTION OF PREFERRED DIRECTORS.
Please instruct the Depositary to vote your shares for either one or two
Nominees by placing an "X" in the appropriate box(es). Do not mark more than two
boxes. Instruction cards not properly completed will not be counted.
A. The election of two (2) Preferred Directors as described in the proxy
statement of the Board of Directors to serve until the 2001 Annual Meeting.
Arthur I. Caplan
FOR
Frederick Doppelt
FOR
Stephen J. McAllister
FOR
Martin Shubik
FOR
Mark box at right if an address change or comment has been noted on the reverse
side of this card.
Please be sure to sign and date this Instruction Card.
Date
_____________________________________
Stockholder sign here
_____________________________________
Co-owner sign here
<PAGE>
INSTRUCTION CARD REQUESTED BY DEPOSITARY,
PURSUANT TO TERMS OF DEPOSIT AGREEMENT,
FOR ELECTION OF PREFERRED DIRECTORS AT
PERINI CORPORATON ANNUAL MEETING - MAY 25, 2000
The undersigned hereby instructs BankBoston, N.A., as Depositary (the
"Depositary") for the $21.25 Convertible Exchangeable Preferred Stock (the
"Preferred Stock") of Perini Corporation, to vote the shares of Preferred Stock
represented by the Depositary Receipts held by the undersigned (the "Depositary
Shares") as directed on the reverse side hereof at the Election of Preferred
Directors to be held at the Annual Meeting of Stockholders at the Crowne Plaza,
Hawthorne Ballroom, 1360 Worcester Road (Route 9 East), Natick, Massachusetts,
on Thursday, May 25, 2000 at 9:00 a.m. or at any adjournments or postponements
thereof.
When properly executed, this Instruction Card will cause the Depositary to vote
the Preferred Stock represented by the Depositary Shares in the manner directed
on the reverse side hereof by the undersigned. If no direction is given, the
Depositary will abstain from voting the Preferred Stock represented by the
Depositary Shares.
PLEASE VOTE, DATE AND SIGN ON REVERSE SIDE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
Please sign exactly as your name(s) appear(s) on the reverse. Where there
is more than one holder, each should sign. When signing as an attorney,
executor, administrator, guardian or trustee, please add your title as
such. If executed by a corporation, the Instruction Card should be signed
by a duly authorized person, stating his or her title or authority. If a
partnership, please sign in partnership name by an authorized person.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
_______________________________ __________________________________
_______________________________ __________________________________
