<PAGE> 1
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
CHAMBERS DEVELOPMENT COMPANY, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
CHAMBERS DEVELOPMENT COMPANY, INC.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ X ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
-------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------
* Set forth the amount of which the filing fee is calculated and state
how it was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and date of its filing.
1) Amount Previously Paid:
-------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------
3) Filing Party:
-------------------------------------------------------------------
4) Date Filed:
-------------------------------------------------------------------
Notes:
<PAGE> 2
CHAMBERS DEVELOPMENT COMPANY, INC.
------------------
NOTICE OF 1994 ANNUAL MEETING OF STOCKHOLDERS
------------------
The 1994 Annual Meeting of Stockholders of Chambers Development Company,
Inc., will be held at the Embassy Suites Hotel, 200 Stoneridge Drive, Columbia,
South Carolina, on May 4, 1994, at 9:00 A.M., local time, for the following
purposes:
(1) To elect two directors for a term of three years each; and
(2) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed March 18, 1994, at the close of business,
as the record date for the purpose of determining the stockholders who are
entitled to receive notice of and to vote at the Annual Meeting. A list of the
stockholders entitled to vote at the meeting will be available for inspection at
least ten days before the meeting during usual business hours at the offices of
the Company located at 10700 Frankstown Road, Pittsburgh, Pennsylvania 15235,
and at the offices of its subsidiary, Chambers of South Carolina, Inc., located
at 6417 Fairfield Road, Columbia, South Carolina 29203, and will also be
available for inspection at the meeting.
STOCKHOLDERS ARE REQUESTED TO SIGN, DATE AND RETURN THE ENCLOSED PROXY IN
THE ATTACHED ADDRESSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES. THOSE STOCKHOLDERS WHO OWN SHARES OF BOTH COMMON STOCK AND CLASS
A COMMON STOCK SHOULD SIGN, DATE AND RETURN BOTH PROXIES, REPRESENTING THEIR
HOLDINGS OF EACH CLASS OF STOCK.
John G. Rangos, Jr.
Vice Chairman--
Administration and Technology,
and Secretary
Pittsburgh, Pennsylvania
March 28, 1994
<PAGE> 3
CHAMBERS DEVELOPMENT COMPANY, INC.
10700 FRANKSTOWN ROAD
PITTSBURGH, PENNSYLVANIA 15235
------------------
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Chambers Development Company, Inc.
(hereinafter called the "Company") for use at the Annual Meeting of Stockholders
of the Company to be held on May 4, 1994, at 9:00 A.M., local time, at the
Embassy Suites Hotel, 200 Stoneridge Drive, Columbia, South Carolina, and at any
and all adjournments thereof, for the purposes set forth in the accompanying
Notice of 1994 Annual Meeting of Stockholders. It is expected that this Proxy
Statement and enclosed form of proxy will be mailed to each stockholder entitled
to vote commencing on March 29, 1994.
Stockholders who execute proxies retain the right to revoke them at any
time before they are voted, upon written notice to the Secretary of the Company.
VOTING SECURITIES
At the close of business on March 18, 1994, the date fixed by the Board of
Directors as the record date for the determination of stockholders of the
Company who are entitled to receive notice of and to vote at the Annual Meeting
of Stockholders, the Company had outstanding 16,015,950 shares of its Common
Stock of the par value of $.50 per share and 50,773,177 shares of its Class A
Common Stock of the par value of $.50 per share entitled to vote at the 1994
Annual Meeting of Stockholders. The holders of such Common Stock and Class A
Common Stock are entitled to ten votes and one vote, respectively, for each
share held on the record date. In accordance with the Company's Certificate of
Incorporation, the holders of shares of Common Stock and of Class A Common Stock
vote together as a single class, except that, at every meeting of stockholders
called for the election of directors, the holders of shares of Class A Common
Stock are entitled to elect one-quarter of the number of directors to be elected
at such meeting or, if one-quarter of such number of directors is not a whole
number, the holders of shares of Class A Common Stock are entitled to elect the
next higher whole number of directors to be elected at such meeting. The
remaining directors are elected by the holders of shares of Class A Common Stock
and of Common Stock, voting together as a single class. The Certificate of
Incorporation and By-Laws of the Company do not permit cumulative voting in the
election of directors, which means that the holders of more than fifty percent
of the shares of Class A Common Stock voted at the meeting, and the holders of
shares of Class A Common Stock and of Common Stock representing more than fifty
percent of the aggregate voting power of all shares of Class A Common Stock and
of Common Stock voted at the meeting, respectively, can each elect all of the
directors to be elected by each such group, and the holders of shares
representing the remainder of the voting power cannot elect any of the directors
to be elected by either such group.
At the 1994 Annual Meeting of Stockholders, the holders of shares of Class
A Common Stock are entitled to elect one director, to serve for a three year
term, and the holders of shares of Common Stock and of Class A Common Stock,
voting together as a single class, are entitled to elect one director, to serve
for a three year term.
Based upon the latest available information received by the Company as of
February 15, 1994, the persons listed in the following table are believed by the
Company to own beneficially the shares of the Company's Common Stock and Class A
Common Stock shown in such table. Except as indicated in the table, the Company
believes that all such persons hold sole voting and dispositive power of the
shares beneficially owned by them. Insofar as is known to the Company, no other
persons beneficially own more than 5% of any class of voting securities of the
Company.
1
<PAGE> 4
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The number of shares of the Company's Class A Common Stock and Common Stock
beneficially owned by each director, each Named Executive and each owner of 5%
or more of a class of stock and by all directors and executive officers of the
Company as a group, at December 31, 1993, and the percentage of the Company's
outstanding Class A Common Stock and Common Stock so owned, are as follows:
<TABLE>
<CAPTION>
TITLE OF CLASS AND AMOUNT
OF BENEFICIAL OWNERSHIP PERCENTAGE OF CLASS
--------------------------- -----------------------
NAME AND ADDRESS CLASS A COMMON CLASS A COMMON
OF BENEFICIAL OWNER(1) COMMON STOCK STOCK COMMON STOCK STOCK
- ------------------------------------------ ------------ ---------- ------------ ------
<S> <C> <C> <C> <C>
John G. Rangos, Sr. 8,963,120 9,598,120 17.7% 59.8%
John G. Rangos, Jr.(2)(3) 2,231,690 2,646,040 4.4% 16.5%
Alexander W. Rangos(2)(3) 2,142,090 2,666,040 4.2% 16.6%
Joseph G. Stotlemyer(4) 35,000 14,050 (14) (14)
Michael J. Peretto(5) 4,000 2,600 (14) (14)
John M. Arthur(6) 9,146 1,000 (14) (14)
William E. Moffett(7) 10,000 -- (14) --
Lawrence J. Yatch(8) 3,000 -- (14) --
William Rodgers, Jr.(9) 9,000 3,000 (14) (14)
All Directors and Executive Officers as a
Group
(16 persons)(10)(11) 12,063,555 13,478,850 23.8% 84.0%
John Rangos Development
Corporation, Inc.(2) 1,452,000 1,452,000 2.9% 9.1%
Lindner Fund, Inc.(12) 3,909,100 -- 7.7% --
Federated Investors(13) 3,175,000 -- 6.3% --
</TABLE>
- ---------
(1) The address of all beneficial owners is the Company's address of 10700
Frankstown Road, Pittsburgh, Pennsylvania 15235, with the exception of
Lindner Fund, Inc., whose address is 7711 Carondelet Avenue, Box 16900, St.
Louis, Missouri 63105, and Federated Investors, whose address is Federated
Investors Tower, Pittsburgh, Pennsylvania 15222.
(2) The number of shares and percentages shown include the registered holdings
of such person and, in addition, 1,452,000 shares of each class
beneficially owned as a result of ownership of stock of John Rangos
Development Corporation, Inc., the sole stockholders of which are John G.
Rangos, Jr. and Alexander W. Rangos, individually and as trustees for
Jenica A. Rangos. As a result, the same 1,452,000 shares of each class are
included above for each of John Rangos Development Corporation, Inc., John
G. Rangos, Jr. and Alexander W. Rangos. John G. Rangos, Jr. and Alexander
W. Rangos are the sons, and Jenica A. Rangos is the daughter, of John G.
Rangos, Sr.
(3) Includes 100,750 shares of Class A Common Stock which may be acquired by
each of John G. Rangos, Jr. and Alexander W. Rangos pursuant to stock
options exercisable currently or within 60 days of this proxy statement.
(4) Includes 35,000 shares of Class A Common Stock which may be acquired by
Joseph G. Stotlemyer pursuant to stock options exercisable currently or
within 60 days of this proxy statement.
(5) Includes 4,000 shares of Class A Common Stock which may be acquired by
Michael J. Peretto pursuant to stock options exercisable currently or
within 60 days of this proxy statement.
(6) Includes 6,000 shares of Class A Common Stock which may be acquired by John
M. Arthur pursuant to stock options exercisable currently or within 60 days
of this proxy statement.
(7) Includes 10,000 shares of Class A Common Stock which may be acquired by
William E. Moffett pursuant to stock options exercisable currently or
within 60 days of this proxy statement.
2
<PAGE> 5
(8) Includes 3,000 shares of Class A Common Stock which may be acquired by
Lawrence J. Yatch pursuant to stock options exercisable currently or within
60 days of this proxy statement.
(9) Includes 4,000 shares of Class A Common Stock which may be acquired by
William Rodgers, Jr. pursuant to stock options exercisable currently or
within 60 days of this proxy statement.
(10) Includes 1,452,000 shares of each class owned by John Rangos Development
Corporation, Inc.
(11) Includes 356,275 shares of Class A Common Stock which may be acquired
pursuant to stock options exercisable currently or within 60 days of this
proxy statement.
(12) Based upon a report on Schedule 13G received by the Company on February 4,
1994. Lindner Fund, Inc. is an investment company.
(13) Based upon a report on Schedule 13G received by the Company on February 14,
1994. Federated Investors is an investment company. The number of shares
indicated represent shares beneficially owned by mutual funds advised by
subsidiaries of Federated Investors which have the power to direct
investments and vote the securities. For purposes of the reporting
requirements of Regulation D of the Securities Exchange Act of 1934,
Federated Investors, its principal shareholders and its investment adviser
subsidiaries may be deemed to be beneficial owners of such securities;
however, in accordance with Rule 13d-4 under the Securities Exchange Act of
1934, Federated Investors, its principal shareholders and its investment
adviser subsidiaries have declared that the filing of the Schedule 13G
disclosing beneficial ownership of the securities should not be construed
as an admission that they are the beneficial owners of such securities, and
Federated Investors, its principal shareholders and its investment adviser
subsidiaries have expressly disclaimed that they are in fact the beneficial
owner of such securities.
(14) Less than 1.0%.
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file with the Securities
and Exchange Commission and the American Stock Exchange initial reports of
ownership and reports of changes in ownership of the Common Stock and Class A
Common Stock. Officers, directors and greater than ten-percent shareholders are
required by SEC regulation to furnish the Company with copies of all Section
16(a) forms they file. To the Company's knowledge, based solely on review of the
copies of such reports furnished to the Company and written representations that
no other reports were required, during the year ended December 31, 1993, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent beneficial owners were complied with.
3
<PAGE> 6
ELECTION OF DIRECTORS
The Board of Directors, consisting of eight directors, is divided into
three classes. Two directors are to be elected at the 1994 Annual Meeting of
Stockholders, both for a three year term. The affirmative vote of the holders of
a majority of the voting power of the shares of Common Stock and Class A Common
Stock voted at the 1994 Annual Meeting of Stockholders, voting together as a
single class, shall be required to elect John G. Rangos, Jr. for a three year
term to the Board of Directors. The affirmative vote of the holders of a
majority of the shares of Class A Common Stock voted at the 1994 Annual Meeting
of Stockholders shall be required to elect William E. Moffett for a three year
term to the Board of Directors. All properly executed proxies received in
response to this solicitation will be voted. Unless otherwise specified on the
proxy, it is the intention of the persons named in such proxies to vote FOR the
nominees listed below. If events not now known or anticipated make any of the
nominees unable to serve, the proxies will be voted in the discretion of the
holders thereof for nominees not named herein in lieu of those unable to serve.
The following table sets forth information concerning the nominees. John G.
Rangos, Jr. and William E. Moffett are currently directors, and each was elected
to serve for a term of three years by the Company's stockholders at the 1991
Annual Meeting of Stockholders.
<TABLE>
<CAPTION>
YEAR FIRST
NAME, PRINCIPAL OCCUPATION, AGE ELECTED CERTAIN OTHER INFORMATION
<S> <C> <C>
John G. Rangos, Jr. (36) 1985 Mr. Rangos has served in his present
Vice Chairman--Administration and position since January 1994. Prior
Technology, and Secretary, thereto, he served as Assistant Manager
Chambers Development Company, Inc. and Manager of Landfill Operations, as
Executive Vice President--Operations from
1985 to 1990 and as Executive Vice
President--Administration and Technology
from 1990 to 1994. Mr. Rangos is a son of
John G. Rangos, Sr., Chairman and Chief
Executive Officer of the Company, and the
brother of Alexander W. Rangos, President
and Chief Operating Officer of the
Company.
William E. Moffett (63) 1987 Mr. Moffett has served on the Company's
Retired Chairman of the Board Board of Directors since January 1987. In
and Chief Executive Officer, May 1985, he retired as President of the
Chatham Enterprises, Inc. Gulf Oil Foundation and as Vice
(real estate development) President--Public Affairs of Gulf Oil
and Hazmed, Inc. Corporation, having joined Gulf Oil
(environmental services) Corporation in 1969 and served in a number
of managerial assignments for that company
and its subsidiaries. Mr. Moffett
currently provides consulting services to
the Company in its public affairs and
marketing of special waste services.
</TABLE>
4
<PAGE> 7
DIRECTORS WHOSE TERMS OF OFFICE WILL CONTINUE AFTER THE MEETING
The following table sets forth certain information about the directors of
the Company whose terms of office will continue after the 1994 Annual Meeting of
Stockholders. Messrs. John G. Rangos, Sr., Michael J. Peretto and Peter J.
Gibbons are scheduled to serve as directors until their terms expire in 1995.
Messrs. Alexander W. Rangos, John M. Arthur and Joseph G. Stotlemyer are
scheduled to serve as directors until their terms expire in 1996.
<TABLE>
<CAPTION>
YEAR FIRST
NAME, PRINCIPAL OCCUPATION, AGE ELECTED CERTAIN OTHER INFORMATION
<S> <C> <C>
John G. Rangos, Sr. (64) 1973 Mr. Rangos has served in his present
Chairman and Chief Executive position since January 1994. Prior
Officer, Chambers Development thereto, he served as President and Chief
Company, Inc. Executive Officer of the Company from 1973
to January 1994. Mr. Rangos is the father
of John G. Rangos, Jr., Vice
Chairman--Administration and Technology,
and Secretary of the Company, and
Alexander W. Rangos, President and Chief
Operating Officer of the Company.
Michael J. Peretto (54) 1975 Mr. Peretto served as Vice
Retired Vice President--Special President--Special Projects of the Company
Projects, until his retirement in 1989. He had been
Chambers Development Company, Inc. employed by the Company since its
founding. Mr. Peretto currently provides
consulting services to the Company in its
corporate development activities.
Peter J. Gibbons (58) 1993 Mr. Gibbons has served on the Company's
Retired Senior Partner, Board of Directors since August 1993.
Price Waterhouse (accounting firm) Prior thereto, he was affiliated with the
accounting firm of Price Waterhouse from
1961 until his retirement in 1993.
Alexander W. Rangos (33) 1985 Mr. Rangos has served in his present
President and Chief Operating position since January 1994. Prior
Officer, thereto, he served with the Company as a
Chambers Development Company, Inc. field manager from 1981 to 1984, as
Manager of the Southern Region from 1984
to 1985, as Executive Vice
President--Corporate Development from 1985
to 1990 and as Executive Vice President--
Operations and Corporate Development from
1990 to 1994. Mr. Rangos is a son of John
G. Rangos, Sr., Chairman and Chief
Executive Officer of the Company, and the
brother of John G. Rangos, Jr., Vice
Chairman--Administration and Technology,
and Secretary of the Company.
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
YEAR FIRST
NAME, PRINCIPAL OCCUPATION, AGE ELECTED CERTAIN OTHER INFORMATION
<S> <C> <C>
John M. Arthur (71) 1989 Mr. Arthur has served on the Company's
Retired Chairman, Board of Directors since February 1989. He
Duquesne Light Company served as Chairman of the Board of
(electric utility) Duquesne Light Company from 1968 until his
retirement in September 1987. Mr. Arthur
currently serves on the Boards of
Directors of DQE, Inc. (utility holding
company), Duquesne Light Company (electric
utility) and Mine Safety Appliances
Company (equipment manufacturing), and on
the Advisory Boards of Mellon Bank, N.A.
(financial institution) and Mellon Bank
Corporation (financial institution). Mr.
Arthur currently provides consulting
services to the Company.
Joseph G. Stotlemyer (52) 1990 Mr. Stotlemyer has served in his present
Vice President--Support Services, position since May 1990. Prior thereto, he
Chambers Development Company, Inc. served the Company as Director of
Corporate Security. From 1966 until
joining the Company in January 1987, Mr.
Stotlemyer was employed by the City of
Pittsburgh, Department of Public Safety.
</TABLE>
INFORMATION REGARDING OTHER EXECUTIVE OFFICERS OF THE COMPANY
William Rodgers, Jr. (age 44) joined the Company in September 1991 and
served as Vice President of Corporate Development until January 1994. Since
January 1994 he has served as Senior Vice President. In addition, since April
1992, Mr. Rodgers has served as Chief Financial Officer. From 1986 until joining
the Company, Mr. Rodgers was employed by National Intergroup, Inc. as Vice
President, General Counsel and Secretary.
Jack D. Weertman (age 43) joined the Company in May 1991 and served as
controller, Southern Region, until August 1991. From September 1991 to January
1994, he served as Regional Vice President of Operations, Southern Region. Since
January 1994 he has served as Senior Vice President of Operations. From July
1979 until joining the Company, Mr. Weertman was employed by WMX Technologies,
Inc. as a Regional Vice President.
Peter V. Morse (age 47) joined the Company in May 1988 and served as
Corporate Development Project Analyst until January 1989. From February 1989 to
June 1989, he served as Director--Administration and Planning. From July 1989 to
December 1990, he served as Assistant Vice President--Corporate Development and
Planning. From January 1991 to September 1991, he served as Assistant Vice
President--Operations and Corporate Development. From September 1991 to January
1994, he served as Vice President of Operations. Since January 1994 he has
served as Senior Vice President of Marketing and Development.
Edward N. Durand (age 40) joined the Company in September 1986 and has
served as Vice President and General Counsel since that time.
David J. Feals (age 36) joined the Company in November 1992 and has served
as Vice President and Corporate Controller since that time. Since June 1993, he
has also served as Chief Accounting Officer. From August 1989 until joining the
Company, Mr. Feals was employed by Beazer USA, Inc. as Vice President and
Controller. From June 1979 to July 1989 he was employed by KPMG Peat Marwick,
most recently as a senior audit manager.
Ronald H. Jones (age 43) joined the Company in July 1989 and served as
Assistant Vice President of Finance until November 1990. From December 1990
until June 1992, he served as Director of Corporate Development. From July 1992
to January 1994, he served as Treasurer and Assistant Secretary. Since January
1994 he has served as Vice President and Treasurer. From March 1980 until
joining the Company, Mr. Jones was employed by Irving Business Center as a Vice
President.
6
<PAGE> 9
Allan D. Pass (age 44) joined the Company in September 1991 and has served
as Vice President of Human Resources since that time. From 1986 until joining
the Company, Dr. Pass was employed by National Behavioral Science Consultants,
as Director.
Lawrence J. Yatch (age 49) joined the Company in October 1991 and served as
Vice President of Special Projects and Government Relations until June 1992.
Since July 1992, he has served as Vice President of Public Affairs. From April
1988 until joining the Company, Mr. Yatch was a partner in the law firm of
Klett, Lieber, Rooney & Schorling.
George R. Johannes (age 55) joined the Company in October 1992 and served
as Executive Vice President-Finance until his resignation in June 1993. From May
1989 until joining the Company, Mr. Johannes was employed by Beazer USA, Inc. as
its Executive Vice President-Finance and Chief Financial Officer. From 1986 to
May 1989, Mr. Johannes was employed by Gemisys Inc. as its Executive Vice
President and Secretary and Chief Financial Officer.
J. Herbert Gaul, Jr. (age 50) joined the Company in October 1992 and served
as Vice President-Finance until his resignation in September 1993. From June
1990 until April 1992, Mr. Gaul was employed by Beazer USA, Inc. as Vice
President and Treasurer. From 1989 until 1990, he was employed by Communication
Transmission, Inc. as its Chief Financial Officer and Senior Vice President.
From 1988 to 1989 he was employed by PLM International, Inc. as its Chief
Financial Officer and Vice President-Finance.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND COMMITTEES
During 1993 there were fourteen regular and special meetings of the Board
of Directors. Each of the incumbent directors attended at least 75% of the total
number of meetings of the Board of Directors and of the committees of the Board
of Directors on which he served during the period.
The Board of Directors has established four committees to exercise certain
of its functions. The Human Resources Committee reviews the performance of
corporate management, makes recommendations with respect to compensation of
management and the establishment of employee compensation plans and administers
the Company's stock option plans. This committee presently consists of William
E. Moffett, John M. Arthur, Michael J. Peretto and Peter J. Gibbons. This
Committee held three meetings in 1993.
The Audit Committee reviews the Company's financial reporting and
accounting practices, recommends the selection of and confers with the Company's
independent auditors, and meets with the Company's internal auditors to review
the effectiveness of the Company's systems of internal control in order to
ascertain that those systems are within acceptable limits of sound practice in
such matters. The Audit Committee presently consists of Peter J. Gibbons, John
M. Arthur, William E. Moffett and Michael J. Peretto. This committee held five
meetings in 1993.
The Nominating Committee recommends qualified candidates for election as
directors to the Company's Board of Directors. The Committee will consider
nominees recommended by stockholders for the 1995 Annual Meeting of Stockholders
if received by the Company by November 29, 1994. The Nominating Committee
presently consists of John G. Rangos, Sr., John M. Arthur and William E.
Moffett. This committee held one meeting in 1993.
The Special Litigation Committee advises the Board of Directors with
respect to the Company's shareholder litigation described below under "Legal
Proceedings." The Special Litigation Committee presently consists of William E.
Moffett, John M. Arthur, Peter J. Gibbons and Michael J. Peretto. This Committee
was formed in 1993 and held nine meetings during the year.
Each director who is not an officer or employee of the Company is entitled
to receive an annual director's fee of $24,000. Each director who is a member of
the Human Resources Committee or the Audit Committee receives an additional fee
of $3,000 annually for each committee. Each nonemployee director is entitled to
receive options for 2,000 shares per year of the Company's Class A Common Stock
under the 1991 Stock Option Plan for Non-Employee Directors. The options have a
10-year term, become exercisable one year after the date of grant and have an
option price equal to fair market value on the date of grant.
7
<PAGE> 10
LEGAL PROCEEDINGS
Between March 18, 1992 and May 7, 1992, various Company shareholders filed
twenty-three actions in the United States District Court for the Western
District of Pennsylvania asserting federal securities fraud claims and pendent
state law claims against the Company, certain of its officers and directors, its
former auditors, and the underwriters of its securities (the "Federal Class
Action"). The significant part of these actions, as amended and consolidated on
November 4, 1992, under the caption In Re: Chambers Development Company, Inc.
Shareholders Litigation, Civil Action No. 92-0679, and brought on behalf of a
putative class of purchasers of the Company's securities between March 18, 1988
and October 20, 1992, is the allegation that the decrease in the Company's stock
price during the period from the Company's March 17, 1992 announcement of a
change in accounting method relating to capitalization of certain costs and
expenses through its October 20, 1992 announcement of a $362 million reduction
in retained earnings as of December 31, 1991, as compared to the amount
previously reported, and a restatement of its 1990 and 1989 consolidated
financial statements, was caused by the Company's misrepresentation of its
earnings and financial condition. One of the original twenty-three complaints,
Yeager v. Rangos, et al., C.A. No. 92-1081, also asserts derivative claims on
behalf of the Company (which is named as a nominal defendant) for breach of
fiduciary duty against certain of its officers and directors and for negligence
against its former auditors (the "Federal Derivative Action").
In addition, three parallel lawsuits have been filed in state courts. Two
derivative actions, asserting waste and mismanagement claims on behalf of the
Company against certain of its officers and directors, have been filed in the
Delaware Court of Chancery for New Castle County (the "Delaware Derivative
Actions") and are pending under the caption In Re: Chambers Development Company,
Inc. Shareholders Litigation, Consolidated C. A. No. 12508. One purported class
action, alleging state securities law and common law claims, has been filed in
the Court of Common Pleas of Allegheny County, Commonwealth of Pennsylvania,
under the caption Integrated Investments, Inc., et al. v. Chambers Development
Company, Inc., et al., No. G.D. 92-7036 (the "State Class Action").
The complaints in the Federal and State Class Actions allege that the
Company, in publicly disseminated materials, intentionally or negligently
misstated its earnings during the class period, thereby deceiving the Company's
shareholders and others with respect to its growth prospects and profitability.
In particular, the plaintiffs allege that the Company's earnings were improperly
increased by capitalizing certain costs and expenses in violation of generally
accepted accounting principles, in part through the use of a formula which
arbitrarily allocated indirect costs and expenses to landfill and development
activities. In addition, the plaintiffs allege that the Company had an
inadequate information system and failed to maintain the records necessary to
support the capitalization of such costs and expenses.
The Federal Class Action claims assert violations of section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, section
11 of the Securities Act of 1933 and negligent misrepresentation against the
Company. Claims under sections 12(2) and 20(a) of the Securities Act of 1933
have been asserted against the Company's officers and directors who are named as
defendants, but not against the Company. The State Class Action asserts similar
violations of the Commonwealth of Pennsylvania securities laws. These actions
seek to recover damages in an unspecified amount which the class members
allegedly sustained by purchasing the Company's securities at artificially
inflated prices, as well as related relief.
The section 11 claims relate to the sale in April 1989 of 2.85 million
shares of the Company's Class A Common Stock at $25 per share (equivalent to 5.7
million shares of its Class A Common Stock at $12.50 per share after a
subsequent two-for-one stock split), the issuance in September 1989 of $110
million principal amount of the Company's 6 3/4% Convertible Subordinated
Debentures Due September 15, 2004 (subsequently converted into Class A Common
Stock on or about September 16, 1991 at $21.125 per share), and the sale in June
1991 of 7 million shares of the Company's Class A Common Stock at $24.875 per
share, and may be asserted by plaintiffs who, subject to certain conditions, are
able to trace their purchases to these offerings. The section 10(b) fraud and
negligent misrepresentation claims relate to these three offerings and open
market transactions, whether or not the plaintiffs are able to trace their
purchases to a specific offering. The Company has been advised by its counsel
that the plaintiffs have alleged that the restatement of the Company's 1990 and
1989 consolidated financial statements is an admission that they were materially
misstated. However, the Company has also been advised by its counsel that the
Company's former auditors and former chief financial officer have contended that
the Company's prior consolidated financial statements were fairly presented in
accordance with generally accepted accounting principles.
8
<PAGE> 11
If a plaintiff were to establish that the Company's consolidated financial
statements were materially misstated, the Company would be liable for
statutorily prescribed damages under section 11 (subject to a causation defense
in which the Company bears the burden of proving that some or all of the loss
resulted from factors other than the misstatement and subject to the statue of
limitations defense) and for damages established by case law under section 10(b)
and the common law claims if that plaintiff were able to establish the remaining
elements of those claims and the Company had no affirmative defense.
The Federal Derivative Action and the Delaware Derivative Actions assert,
inter alia, that the Company's officers and directors committed acts of waste,
mismanagement and breach of fiduciary duty by allegedly instituting or approving
the Company's accounting policies relating to capitalization of certain costs
and expenses for the purpose of increasing their salaries, fees, stock and other
benefits. These actions, which seek recovery of unspecified damages on behalf of
the Company, allege that the Company has been damaged because it has become
exposed to the risk of an adverse judgment or settlement in the class actions,
that it has and will incur costs to defend the class actions, and that it has
suffered injury to its reputation.
The twenty-three separate actions comprising the Federal Class Action have
been consolidated, and the plaintiffs have filed amended consolidated class
action complaints. On February 23, 1994, the court substantially denied the
motions of the Company and its officers and directors to dismiss the complaint
in the Federal Class Action. The Company's time to answer the complaint in the
Federal Class Action has been extended to April 6, 1994, and the Company's time
to respond to the contribution and indemnity cross-claims asserted in the
answers of its former auditors and the former Chief Financial Officer has been
extended to April 11, 1994. The Company's time to move against or answer the
complaint in the Federal Derivative Action has been extended to April 22, 1994.
The Company's time to answer or move against the complaint in the State
Class Action has been extended without date and the court entered an order
staying the action indefinitely pending further notice.
The Company and its officers and directors have moved to dismiss, or
alternatively stay, the Delaware Derivative Actions. In November 1992, the
Delaware plaintiffs filed an amended consolidated complaint containing
supplemental allegations based on the Company's October 20, 1992 announcement.
The Company and certain of its officers and directors have been served with a
document request in the Delaware Derivative Actions, but an order was entered
staying the Delaware Derivative Actions pending the resolution of the Federal
Class Action and Derivative Actions. The Company served its initial response to
plaintiffs' document request in the Federal Class Action in late 1992, and has
commenced document production.
On March 7, 1994, the plaintiffs filed an amended motion for class
certification. Pursuant to the court's February 23, 1994 order, the parties are
negotiating a scheduling order for the briefing of the class certification
motion. A status/settlement conference before the court is scheduled for April
29, 1994.
On March 5, 1993, another state court action was filed in the Court of
Common Pleas in Allegheny County, Pennsylvania, under the caption Balaban v.
Rangos, et al. This action asserts derivative claims on behalf of the Company
similar in nature to those asserted in the Federal and Delaware Derivative
Actions. The Company's time to answer or move against the complaint has been
extended without date.
The Company intends to defend vigorously each of these actions. In the
event that the Company is unsuccessful in its defense, the result would have a
material adverse effect on the Company.
Shortly after the Company's March 17, 1992 announcement of a change in
accounting method, the Securities and Exchange Commission (the "SEC") initiated
an informal investigation into the possibility that persons or entities had
traded in the Company's securities on the basis of inside information prior to
the announcement and with respect to the Company's accounting policies
concerning capitalization and the accuracy of its financial statements. On
September 30, 1992, a formal order of investigation was issued by the SEC with
respect to potential violations by the Company and others of sections 10(b) and
13(a) and (b) of the Securities Exchange Act of 1934 and various rules
promulgated thereunder. The Company is cooperating with the investigation
through the production of documents and by providing witnesses pursuant to the
SEC's request.
The American Stock Exchange and the Chicago Board of Options Exchange are
conducting investigations into trading activity on their respective exchanges in
the Company's securities and in put options on the Company's securities prior to
the March 17, 1992 announcement.
9
<PAGE> 12
On December 4, 1992, the Company was served with a grand jury subpoena out
of the United States District Court for the Eastern District of New York seeking
production of public filings and reports disseminated to its shareholders,
documents referring to the preparation of its financial statements and other
materials. The Company has responded to the subpoena by producing documents. The
grand jury investigation is ongoing and it appears to be focusing on issues
similar to those raised by the civil litigation and the SEC investigation
described above.
The Company is cooperating with each of the investigations referred to in
the three preceding paragraphs.
REPORT OF THE HUMAN RESOURCES COMMITTEE
As members of the Human Resources Committee of Chambers Development
Company, Inc. (the "Committee"), it is our duty to review the annual
compensation paid to the Chief Executive Officer and each of the other executive
officers of the Company and to administer the Company's various incentive plans,
including its stock option plan and its management incentive compensation plan.
This report relates to the compensation paid to the Chief Executive Officer and
the other executive officers of the Company during the year ended December 31,
1993.
COMPENSATION POLICY AND OBJECTIVES
The compensation policy of the Company, which is endorsed by the Committee,
is that a substantial portion of the annual compensation of each executive
officer is based upon his individual contribution to the Company and the
function for which he is responsible. This is particularly applicable with
respect to the determination of the base salary of executive officers. The
Company has retained the services of Hay Management Consultants ("HMC"), a
compensation consulting firm, to assist the Committee in connection with the
performance of various of its duties. The Committee currently evaluates various
factors utilized by HMC in reviewing certain aspects of management's
compensation. Members of the Committee also review compensation, such as surveys
provided by HMC and others. The basis for determining the relative values of the
Company's various executive officers has been and will continue to be a
combination of market pricing to attract and retain talented and dedicated
individuals, the Committee's subjective evaluation of the officers' professional
contributions and the relative internal importance of the position, as ranked
through the HMC job evaluation system, with subjective evaluation and market
pricing being the more dominant influences.
BASE SALARY OF THE PRESIDENT AND CHIEF EXECUTIVE OFFICER
John G. Rangos, Sr.'s base salary for 1993, as President and Chief
Executive Officer, was based principally upon the Committee's subjective
perception of Mr. Rangos, Sr.'s organizational responsibilities, contributions
and experience and the commitment which Mr. Rangos, Sr. made towards the growth
and development of the Company. Mr. Rangos, Sr.'s base salary for 1992 and 1993
was approved by the Committee in November 1991, and was subsequently reduced
pursuant to the Company's salary reduction program described below.
MANAGEMENT INCENTIVE COMPENSATION FOR EXECUTIVE OFFICERS
Under the Company's management incentive compensation plan for its key
managerial personnel, in which approximately 150 employees are eligible to
participate, bonuses are paid based on the officer's performance and the
performance of the Company. A separate program was established by the Committee
in 1991 with respect to Mr. Rangos, Sr., and is described below.
Currently all of the senior executive officers, other than Mr. Rangos, Sr.,
are eligible to participate in the management incentive compensation plan. The
purpose of the management incentive plan is to:
- Focus key management's efforts on performance which will increase the
value of the Company to its stockholders;
- Align the interests of key management with those of the stockholders;
- Provide a highly competitive short-and long-term incentive and capital
accumulation opportunity;
- Provide a significant retention incentive for selected key managers; and
- Develop a sense of teamwork, participation and partnership at all
organizational levels.
10
<PAGE> 13
The plan provides for a cash bonus based on the performance of the Company and
the individual during a twelve month performance cycle. The Company goals
consist of developmental progress as measured by operating objectives, targeted
levels of return on equity and total stockholder return (measured by stock price
performance and dividend yield) compared to the total stockholder return
achieved by peer companies.
The Company's performance, for purposes of compensation decisions, is
measured under the management incentive compensation plan against goals
established prior to the start of the fiscal year by the Committee and is
reviewed and approved by the Committee. No executive officer received incentive
compensation awards in 1993, other than awards of $65,000 to William Rodgers,
Jr., and $20,000 to Lawrence J. Yatch.
INCENTIVE COMPENSATION FOR THE PRESIDENT AND CHIEF EXECUTIVE OFFICER
Prior to 1991, in determining incentive compensation for John G. Rangos,
Sr. as President and Chief Executive Officer during 1993, the Committee examined
on a subjective basis the individual performance of Mr. Rangos, Sr. and the
performance of the Company. In 1991 the Committee established a separate
incentive compensation plan for Mr. Rangos, Sr. which provided for stock and
cash bonuses based on corporate performance goals relating to earnings per share
and return on average equity. This plan provided for an annual potential bonus
of up to 50,000 shares of Common Stock, plus cash equal to all federal, state
and local income taxes due and payable as a result of the distribution of the
shares of stock. Based upon the criteria in this program, John G. Rangos, Sr.
was not paid an incentive compensation award for the years 1992 or 1993.
STOCK OPTION PLANS
The purpose of the Company's 1988 Stock Option Plan and its 1993 Stock
Incentive Plan (collectively the "Plan") is to focus on key individuals who, in
the judgment of the Committee, can be expected to contribute to the management
and growth of the Company. Additionally, in concert with the Company's
compensation philosophy, the purposes of the Plan are to:
- Align the interests of key individuals with those of the stockholders;
- Develop a sense of teamwork, participation and partnership at all
organizational levels; and
- Provide a significant retention compensation element.
During 1993, the Committee consulted with Towers Perrin ("TP") in
considering stock option grants to each of the executive officers of the Company
under the Plan.
The Committee worked with TP, and TP met with key executives to develop a
comprehensive understanding of current organizational business and compensation
objectives. TP reviewed on an individual-by-individual basis the proposed
awardee's current salary and organizational level in the context of the proposed
award. These levels were then compared to competitive standards based upon TP's
studies and surveys. TP also considered these factors in formulating the basis
for the proposed stock option awards to be used for recruitment and retention
purposes, in conjunction with established individual award guidelines,
organizational responsibility, past practice and, where appropriate,
demonstrated performance. TP additionally reviewed the vesting schedule utilized
for recruitment and retention purposes as contrasted with the vesting schedule
for ongoing Plan award purposes. Finally, TP studied the Plan itself, including
shares reserved for the Plan as a percentage of total outstanding shares and the
proposed awards compared to Institutional Shareholder Services, Inc.'s annual
dilution guidelines.
In October 1993, following consultation with TP, the Company adopted the
use of the Black-Sholes method in the determination of the size of stock option
awards. Officers received stock options which were based on their organizational
responsibilities and positions within the Company. In determining the stock
option grants, the Company considered a total compensation philosophy and
objectives which took into consideration base salaries, short-term incentives,
long-term incentives and benefits. As part of this integrated approach, it was
agreed that emphasis should be placed upon providing selected individuals with
long-term incentives through the utilization of the Plan.
Given the business challenges facing the Company, John G. Rangos, Sr., John
G. Rangos, Jr., and Alexander W. Rangos did not receive awards in 1993 under the
Plan.
11
<PAGE> 14
The Company believes that stock options granted under the 1993 Stock
Incentive Plan qualify as "performance-based compensation" under the new Section
162(m) of the Internal Revenue Code and the Company does not currently
anticipate that it will be affected by the limitation under Section 162(m) on
deduction of executive compensation. However, the Company entered into
employment contracts with several key executives prior to the enactment of
Section 162(m), and if the executives received the severance benefits provided
under the terms of the employment contracts, Section 162(m) could be applicable.
The Company is currently studying the new $1 million compensation deduction
limitation under Section 162(m) and will report in the future on the feasibility
of compliance. Currently no executive officer is expected to receive more than
$1 million in compensation in 1994.
1992 SALARY REDUCTION PROGRAM
Effective May 1, 1992, the Company implemented a management salary
reduction program which affected all management employees, including executive
officers who receive a base compensation of $70,000 and above. The Company
believed that all members of management should participate in the Company's
comprehensive cost reduction effort. The management salary reduction program
mandated that all employees with a base salary of over $70,000 undergo a 10%
reduction of salary over $70,000 up to $100,000. Base salary between $100,000
and $200,000 was reduced by 15%, and base salary of more than $200,000 was
reduced by 20%.
In November 1992, the Company, in its continuing effort to enhance its
competitive capabilities within the market place, made a temporary adjustment in
the administration of compensation guidelines by freezing compensation to
salaried personnel. The temporary compensation policy changes mandated that no
merit increases would be granted to any such employees for a period of one year.
In February 1994, the Committee authorized the resumption of merit increases,
retroactive to December 20, 1993.
Human Resources Committee
William E. Moffett, Chairman
John M. Arthur
Peter J. Gibbons
Michael J. Peretto
March 16, 1994
12
<PAGE> 15
COMPANY STOCK PERFORMANCE
The following graph and table compare the cumulative total returns
(assuming reinvestment of dividends) for the five years ended December 31, 1993
of $100 invested on December 31, 1988 in each of the Company's Class A Common
Stock, the Standard & Poor's 500 Stock Index and the Standard and Poor's
Pollution Control Index:
COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN
AMONG CHAMBERS CLASS A COMMON STOCK, THE S&P 500 INDEX AND THE S&P POLLUTION
CONTROL INDEX
<TABLE>
<CAPTION>
CHAMBERS S & P
MEASUREMENT PERIOD CLASS A POLLUTION
(FISCAL YEAR COVERED) COMMON STOCK S & P 500 CONTROL
<S> <C> <C> <C>
1988 100 100 100
1989 155 132 161
1990 175 128 144
1991 310 166 169
1992 63 179 170
1993 37 197 124
</TABLE>
13
<PAGE> 16
HUMAN RESOURCES COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
In their capacities as consultants to the Company, Messrs. William E.
Moffett and John M. Arthur, who are also members of the Company's Board of
Directors, received $144,000 and $30,000, respectively, for consulting services
rendered during 1993. Mr. Moffett performs consulting services for the Company
in public affairs and marketing of special waste services. Mr. Arthur performs
consulting services for the Company in the marketing of special waste services.
Messrs. Arthur and Moffett are not current or former officers or employees
of the Company or any of its subsidiaries. Mr. Michael J. Peretto served as Vice
President--Special Projects of the Company until his retirement in 1989.
EXECUTIVE COMPENSATION
The following table sets forth the aggregate remuneration paid or accrued
during the years ended December 31, 1993, 1992 and 1991 for the chief executive
officer and the other four executive officers of the Company at December 31,
1993 (the "Named Executives") who were most highly compensated during 1993.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
--------------
AWARDS
------------
ANNUAL COMPENSATION SECURITIES
--------------------------- OTHER ANNUAL UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($)(1) COMPENSATION($)(2) OPTIONS (#)
---- -------- --------- ------------------ --------------------
<S> <C> <C> <C> <C> <C>
John G. Rangos, Sr. 1993 $662,000 $ 0 $ 0 0
Chairman and 1992 709,769 0 0 0
Chief Executive Officer 1991 588,461 0 0
John G. Rangos, Jr. 1993 282,000 0 0 0
Vice Chairman- 1992 339,144 0 0 0
Administration and 1991 357,759 0 25,000
Technology, and Secretary
Alexander W. Rangos 1993 282,000 0 0 0
President and Chief 1992 339,144 0 0 0
Operating Officer 1991 393,566 0 25,000
William Rodgers, Jr. 1993 203,831 65,000 0 30,000
Senior Vice President 1992 188,231 0 0 40,000
and Chief Financial Officer 1991 60,000 10,000 0
Lawrence J. Yatch 1993 174,900 20,000 0 15,000
Vice President- 1992 172,731 10,000 0 17,000
Public Affairs 1991 40,846 14,608 0
</TABLE>
- ---------
(1) Amounts shown represent cash bonuses and are included in the year earned,
with the exception of $10,000 of the bonus paid to Lawrence J. Yatch in
1993, which was attributable to anticipated service in 1994.
(2) Disclosure of information for years prior to 1992 is not required.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
In February 1993, the Company entered into employment agreements with eight
current key executives: William Rodgers, Jr., Senior Vice President; Jack D.
Weertman, Senior Vice President of Operations; Peter V. Morse, Senior Vice
President of Marketing and Development; Edward N. Durand, Vice President and
General Counsel; David J. Feals, Vice President and Corporate Controller; Ronald
H. Jones, Vice President and Treasurer; Lawrence J. Yatch, Vice President of
Public Affairs; and Joseph G. Stotlemyer, Vice President-Support Services. The
agreements provide for the continued employment of such executives for a period
of two years with provisions for continued one year renewals. As of the date of
this proxy statement, the Company has not renewed the agreements, but has
proposed renewal on substantially similar terms following the February 1995
expiration of the
14
<PAGE> 17
original agreements. The employment agreements contemplate that until February
1995, such executives would continue to be employed in capacities commensurate
with their capacities as of February 1993 and compensated at their highest rate
of compensation since February 1993. The employment agreements contemplate,
further, that in the event the executive's employment is terminated (a) by the
executive because either he has not been employed in a commensurate capacity or
he has not been commensurately compensated or (b) by the Company other than for
just cause, the executive would be entitled to receive the salary and the
average bonus under the Management Incentive Compensation Plan that he would
have received through the remainder of the two-year period had his employment
with the Company not terminated. The agreements also provide that the executive
shall be entitled to three years' compensation if a change in control occurs and
the executive is not offered employment with the successor Company on
essentially commensurate terms.
The following table sets forth the annual compensation provided for in the
employment agreements with the eight key executives referenced above and the
compensation to be provided upon termination of employment or a change in
control.
<TABLE>
<CAPTION>
TERMINATION OF
EXECUTIVE EMPLOYMENT CHANGE IN CONTROL
<S> <C> <C>
William Rodgers, Jr............................ $675,000 $1,210,950
Jack D. Weertman............................... 675,000 1,210,950
Peter V. Morse................................. 675,000 1,210,950
Edward N. Durand............................... 570,237 1,023,005
Lawrence J. Yatch.............................. 524,700 836,722
David J. Feals................................. 438,210 786,148
Ronald H. Jones................................ 375,000 598,000
Joseph G. Stotlemyer........................... 352,701 632,745
George R. Johannes(1)
</TABLE>
- ---------
(1) By letter delivered on June 24, 1993, George R. Johannes submitted his
resignation as Executive Vice President-Finance of the Company. In that
letter Mr. Johannes asserted that he was terminating his employment on the
grounds that it was his opinion that his duties, status and responsibility
had been diminished. On July 23, 1993, Mr. Johannes filed a demand for
arbitration, claiming approximately $1,200,000 in severance benefits
pursuant to employment agreements dated October 6, 1992, and February 3,
1993. The arbitration hearing is scheduled for late March 1994. The Company
believes it has meritorious defenses to Mr. Johannes' claim and it intends
to defend vigorously against the claim.
The Company also has entered into an employment agreement with one other
executive, Allan D. Pass. The agreement with Dr. Pass provides for a five-year
term of employment commencing in September 1991 at an annual base salary of
$175,000; if the agreement is terminated by the Company without due cause, Dr.
Pass is entitled to be paid his base salary through the remainder of the term.
The following table sets forth information concerning stock options granted
to the Named Executives under the Company's stock option plans during the year
ended December 31, 1993.
15
<PAGE> 18
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
--------------------------------------------------------------------------------- VALUE AT ASSUMED
NUMBER OF ANNUAL RATES OF
SECURITIES % OF STOCK APPRECIATION
UNDERLYING TOTAL OPTIONS EXERCISE OR BASE FOR OPTION TERM
OPTIONS GRANTED TO PRICE EXPIRATION --------------------
NAME GRANTED(#)(1) EMPLOYEES IN 1993 ($/SH)(2) DATE 5% 10%
- -------------------- ---------------- ---------------------- ------------------ ---------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
John G. Rangos, Sr. -- -- -- -- -- --
John G. Rangos, Jr. -- -- -- -- -- --
Alexander W. Rangos -- -- -- -- -- --
William Rodgers, Jr. 30,000 6.2% $ 4.03 12/21/03 $76,000 $192,800
Lawrence J. Yatch 15,000 3.1 4.03 12/21/03 38,000 96,400
</TABLE>
- ---------
(1) The options have a maximum term of ten years, subject to earlier termination
in certain events related to termination of employment, and become
exercisable in cumulative annual increments of 25% each year commencing one
year after the date of grant.
(2) The exercise price and tax withholding obligations related to exercises may
be satisfied by the delivery to the Company of cash or previously owned
shares of the Company's Class A Common Stock.
The following table sets forth information concerning stock options
exercised during the year ended December 31, 1993, and unexercised options at
December 31, 1993, for each of the Named Executives.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND 1993 YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
AT 1993 YEAR END AT 1993 YEAR END ($)(1)
SHARES ACQUIRED VALUE ------------------------------- -------------------------------
NAME ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------- ---------------- ----------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
John G. Rangos, Sr. 0 0 -- -- 0 0
John G. Rangos, Jr. 0 0 82,000 25,000 0 0
Alexander W. Rangos 0 0 82,000 25,000 0 0
William Rodgers, Jr. 0 0 4,000 70,000 0 0
Lawrence J. Yatch 0 0 3,000 29,000 0 0
</TABLE>
- ---------
(1) Based on the market value of underlying securities at December 31, 1993,
less the exercise price.
16
<PAGE> 19
INTEREST OF MANAGEMENT IN MATERIAL TRANSACTIONS
On November 14, 1985, John G. Rangos, Sr., John G. Rangos, Jr. and
Alexander W. Rangos, doing business as Synergy Associates, completed the private
placement of a $3,000,000 Allegheny County Industrial Development Variable Rate
Demand Note, initially bearing interest at a floating rate equal to 63% of the
prime interest rate of PNC Bank, to finance the conversion of existing property
into the current headquarters of the Company. The lender has agreed not to
exercise its right to demand payment before November 1, 1994. Synergy Associates
is directly liable on the instrument, which is secured by the property, but the
Company, as the tenant of the facility, was required by the lender to guarantee
the financing. The guarantee was dictated by the conditions of this particular
financing, and the Company does not expect to guarantee obligations of
stockholders and officers as a general matter. Under the lease, which was
entered into in December 1986, Synergy Associates passed through to the Company
certain federal income tax credits. Through March 1987, it was determined that
the amount of such tax credits passed through to the Company exceeded $500,000.
Because the amount of these tax credits substantially exceeded the expectations
of the parties at the time the lease was entered into, the Company agreed to
modify the lease to provide to Synergy Associates the option, exercisable at any
time, to have the Company prepay the twentieth year's rent in an amount equal to
the rent that is due in the year in which the option is exercised. This option
was exercised in April 1988. The lease provides for a renewal term of ten years,
following the expiration of the initial twenty-year term. This long-term leasing
arrangement and guarantee by the Company of the financing discussed above were
approved by a majority of the disinterested directors of the Company on November
1, 1985. The cost to the Company as lessee, including the cost of construction
paid for by the Company, is approximately $19.18 per square foot per year, based
upon 57,238 square feet of rented space. The lease provides for annual rent
increases based upon inflation, increases in insurance costs and real estate
taxes, and changes in the debt service costs to Synergy Associates.
In September 1989, the Board of Directors authorized a program supporting
the purchase of the common stock of the Company by officers, which provided for
a guarantee by the Company of the payment of amounts due pursuant to loans made
by Dollar Bank, Federal Savings Bank, to certain persons then serving as
officers of the Company, William R. Nelson, Edward N. Durand, Frank D.
Hutchinson, Dale O. Nolder, Jr., John J. Cushma and Joseph G. Stotlemyer, and
one of its advisors, Martin G. Hamberger. In August 1990, the Board of Directors
authorized the guarantee by the Company of payments of amounts due pursuant to a
loan made by Dollar Bank to Richard A. Knight. The proceeds of such loans were
mandated to be used by such persons to acquire shares of the common stock of the
Company. The program required that all persons pledge the shares of their stock
as collateral for the Company's guarantee of their loans. Messrs. Hutchinson,
Hamberger, Knight, Nelson and Nolder are no longer employed by the Company as
officers. The Company was released from its guaranty upon the repayment of the
loans by Messrs. Hutchinson and Hamberger. During 1992, the Company purchased at
par from Dollar Bank the notes owing from Messrs. Knight, Nelson, Durand,
Nolder, Cushma and Stotlemyer, and currently holds the notes from those
individuals. The aggregate amount of such notes is $1,680,000.
On July 8, 1993, the Company entered into a purchase option with John G.
Rangos, Sr., to acquire approximately 68.45 acres of land which are contiguous
to the Company's Monroeville landfill in Pennsylvania. The option, which extends
through December 31, 1996, and for which Mr. Rangos was paid $87,000, grants to
the Company the right to purchase the property for a consideration of
$2,982,000. An independent appraisal of the property in June 1993 indicated a
fair market value of $2,982,000. Mr. Rangos currently owns an undivided 70%
interest in the property and holds an option to acquire the remaining 30%
undivided interest from, among others, Michael J. Peretto, a director of the
Company. If the option is exercised, the property would be intended for use as
expanded disposal area for the Company's Monroeville landfill. Also on July 8,
1993, the Company entered into an agreement of sale with Mr. Rangos for the
purchase from him of two parcels of land used in connection with the Monroeville
landfill and consisting of a total of approximately 1.2 acres, for a total
consideration of $34,000. An independent appraisal of these parcels indicated a
fair market value of $34,000. Each of these transactions was approved by a
majority of the disinterested directors of the Company.
17
<PAGE> 20
STOCKHOLDERS' PROPOSALS
In order to be considered for inclusion in the Company's proxy statement
and form of proxy for the 1995 Annual Meeting of Stockholders, any stockholder
proposal intended to be presented at the 1995 Annual Meeting must be received by
the Secretary of the Company, at 10700 Frankstown Road, Pittsburgh, Pennsylvania
15235, not later than November 29, 1994.
OTHER MATTERS
As of the date of this Proxy Statement, management does not intend to
present to the meeting, and has no knowledge that others will present, any
matters other than the matters set forth in the Notice of 1994 Annual Meeting of
Stockholders. If any other matters should properly come before the meeting, the
persons named in the accompanying form of proxy will vote on such matters in
accordance with their own judgment. The holdings by the officers and directors
of the Company as a group of the outstanding voting securities of the Company
are such that the adoption of the foregoing proposals of management described in
this Proxy Statement is reasonably assured, in that management intends to vote
in favor of each proposal.
INDEPENDENT AUDITORS
Deloitte & Touche served as the independent auditors for the Company for
the years ended December 31, 1991, 1992 and 1993 and will continue in that
capacity for the year 1994. A representative of Deloitte & Touche will be
present at the 1994 Annual Meeting of Stockholders. It is not expected that such
representative will make a statement at the meeting, but he will have an
opportunity to make a statement if he so desires and will be available to
respond to appropriate questions from stockholders.
GENERAL
Proxies in the form enclosed are solicited by or on behalf of the Board of
Directors of the Company. The Company will bear the cost of preparing,
assembling and mailing material in connection with this solicitation of proxies
and may reimburse persons holding stock in their names or those of their
nominees for their expense in sending solicitation material to their principals.
It is important that proxies be returned promptly. Therefore, stockholders
are urged to sign, date and return the enclosed proxy in the attached stamped
and addressed envelope.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 1993, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WILL BE
FURNISHED, WITHOUT CHARGE, TO ANY STOCKHOLDER UPON WRITTEN REQUEST MAILED TO:
WILLIAM RODGERS, JR., SENIOR VICE PRESIDENT, CHAMBERS DEVELOPMENT COMPANY, INC.,
10700 FRANKSTOWN ROAD, PITTSBURGH, PENNSYLVANIA 15235.
18
<PAGE> 21
COMMON STOCK
CHAMBERS DEVELOPMENT COMPANY, INC.
10700 FRANKSTOWN ROAD
PITTSBURGH, PA 15235
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints John G. Rangos, Sr., and John G.
Rangos, Jr., as attorneys and proxies, each with full power of substitution,
and hereby authorizes them to represent and to vote, as designated on the
reverse side hereof, all the shares of Common Stock of Chambers Development
Company, Inc. held of record by the undersigned on March 18, 1994, at the
Annual Meeting of Stockholders of the Company to be held at the Embassy
Suites Hotel, Columbia, South Carolina on May 4, 1994 at 9:00 a.m., local time,
or any adjournment thereof, upon the matters described in the Notice of such
Annual Meeting and Proxy Statement dated March 28, 1994, receipt of which is
hereby acknowledged, and, in their discretion, upon any other business that may
properly come before the Meeting.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS SPECIFIED ON THE
REVERSE SIDE, BUT IF NO SPECIFICATION IS MADE, THE PROXIES INTEND TO VOTE FOR
THE ELECTION OF THE NOMINEES LISTED IN THE PROXY STATEMENT.
Continued and to be signed and dated on the reverse side.
<PAGE> 22
<TABLE>
<S> <C> <C> <C>
1. ELECTION OF DIRECTORS [ ] FOR the nominees [ ] WITHHOLD AUTHORITY to vote [ ] EXCEPTIONS*
listed below for all nominees listed below
</TABLE>
John G. Rangos, Jr. (to be elected for a three year term by both the holders of
Class A Common and of Common Stock, voting as a single
class)
INSTRUCTION: To withhold authority to vote for any individual nominee, mark the
Exceptions box and write the nominee's name on the line below.
*EXCEPTIONS __________________________________________________________________
This proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder.
Address Change [ ]
and/or Comments Mark Here
PROXY DEPARTMENT
NEW YORK, N.Y. 10203-0765
Please sign exactly as name appears hereon. When
shares are held by joint tenants, both should sign.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such. If a corporation, please sign in full
corporate name by president or other authorized
officer. If a partnership, please sign in
partnership name by authorized person.
Dated________________________________________,1994
__________________________________________________
Signature
__________________________________________________
Signature, if held jointly
VOTES MUST BE INDICATED
(x) IN BLACK OR BLUE INK. [ ]
SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE
<PAGE> 23
CLASS A COMMON STOCK
CHAMBERS DEVELOPMENT COMPANY, INC.
10700 FRANKSTOWN ROAD
PITTSBURGH, PA 15235
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints John G. Rangos, Sr., and John G.
Rangos, Jr., as attorneys and proxies, each with full power of substitution,
and hereby authorizes them to represent and to vote, as designated on the
reverse side hereof, all the shares of Class A Common Stock of Chambers
Development Company, Inc. held of record by the undersigned on March 18, 1994,
at the Annual Meeting of Stockholders of the Company to be held at the Embassy
Suites Hotel, Columbia, South Carolina on May 4, 1994 at 9:00 a.m., local time,
or any adjournment thereof, upon the matters described in the Notice of such
Annual Meeting and Proxy Statement dated March 28, 1994, receipt of which is
hereby acknowledged, and, in their discretion, upon any other business that may
properly come before the Meeting.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS SPECIFIED ON THE
REVERSE SIDE, BUT IF NO SPECIFICATION IS MADE, THE PROXIES INTEND TO VOTE FOR
THE ELECTION OF THE NOMINEES LISTED IN THE PROXY STATEMENT.
Continued and to be signed and dated on the reverse side.
<PAGE> 24
<TABLE>
<S> <C> <C> <C>
1. ELECTION OF DIRECTORS [ ] FOR the nominees [ ] WITHHOLD AUTHORITY to vote [ ] EXCEPTIONS*
listed below for all nominees listed below
</TABLE>
John G. Rangos, Jr. (to be elected for a three year term by both the holders of
Class A Common and of Common Stock, voting as a single
class)
William E. Moffett (to be elected for a three year term by the holders of Class
A Common Stock)
INSTRUCTION: To withhold authority to vote for any individual nominee, mark the
Exceptions box and write the nominee's name on the line below.
*EXCEPTIONS __________________________________________________________________
This proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder.
Address Change [ ]
and/or Comments Mark Here
PROXY DEPARTMENT
NEW YORK, N.Y. 10203-0765
Please sign exactly as name appears hereon. When
shares are held by joint tenants, both should sign.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such. If a corporation, please sign in full
corporate name by president or other authorized
officer. If a partnership, please sign in
partnership name by authorized person.
Date________________________________________, 1994
__________________________________________________
Signature
__________________________________________________
Signature, if held jointly
VOTES MUST BE INDICATED
(x) IN BLACK OR BLUE INK. [ ]
SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE
