SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[_] Definitive Additional Materials by Rule 14a-6(e)(2))
[_] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
AMERICAN BUILDINGS COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
________________________________________________________________________________
1) Title of each class of securities to which transaction applies:
________________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
________________________________________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
________________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
________________________________________________________________________________
5) Total fee paid:
[_] Fee paid previously with preliminary materials:
________________________________________________________________________________
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
AMERICAN BUILDINGS COMPANY
1150 STATE DOCKS ROAD
EUFAULA, ALABAMA 36027
334-687-2032
March 26, 1999
Dear Stockholder:
You are cordially invited to attend the Company's Annual Meeting of
Stockholders to be held at 10:00 A.M. on Tuesday, April 27, 1999 at the offices
of Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New York 10103.
At the meeting you will only be asked to elect six directors of the
Company. In addition, we will be pleased to report on the affairs of the Company
and a discussion period will be provided for questions and comments of general
interest to stockholders.
We look forward to greeting personally those stockholders who are able to
be present at the meeting; however, whether or not you plan to be with us at the
meeting, it is important that your shares be represented. Accordingly, you are
requested to sign and date the enclosed proxy and mail it in the envelope
provided at your earliest convenience.
Thank you for your cooperation.
Very truly yours,
William L. Selden
Chairman of the Board
of Directors
Robert T. Ammerman
Chief Executive Officer
<PAGE>
AMERICAN BUILDINGS COMPANY
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
----------
Eufaula, Alabama
March 26, 1999
Notice is hereby given that the Annual Meeting of Stockholders of American
Buildings Company will be held on Tuesday, April 27, 1999 at 10:00 A.M. at the
offices of Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New York
10103 for the following purposes:
(1) To elect six directors to serve for the ensuing year; and
(2) To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
Stockholders of record at the close of business on March 15, 1999 will be
entitled to notice of and to vote at the Annual Meeting or any adjournment
thereof.
All stockholders are cordially invited to attend the Annual Meeting in
person. Stockholders who are unable to attend the Annual Meeting in person are
requested to complete and date the enclosed form of proxy and return it promptly
in the envelope provided. No postage is required if mailed in the United States.
Stockholders who attend the Annual Meeting may revoke their proxy and vote their
shares in person.
PEGGY S. WOODHAM
Secretary
<PAGE>
AMERICAN BUILDINGS COMPANY
1150 State Docks Road
Eufaula, Alabama 36027
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PROXY STATEMENT
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GENERAL INFORMATION
Proxy Solicitation
This Proxy Statement is furnished to the holders of Common Stock, par value
$.01 per share (the "Common Stock"), of American Buildings Company (the
"Company") in connection with the solicitation by the Board of Directors of the
Company of proxies for use at the Annual Meeting of Stockholders to be held on
Tuesday, April 27, 1999, or at any adjournment thereof, pursuant to the
accompanying Notice of Annual Meeting of Stockholders. The purpose of the
meeting and the matters to be acted upon are set forth in the accompanying
Notice of Annual Meeting of Stockholders. The Board of Directors is not
currently aware of any other matters which will come before the meeting.
Proxies for use at the meeting are being solicited by the Board of
Directors of the Company. Proxies will be mailed to stockholders on or about
March 26, 1999 and will be solicited chiefly by mail. The Company will make
arrangements with brokerage houses and other custodians, nominees and
fiduciaries to send proxies and proxy material to the beneficial owners of the
shares and will reimburse them for their expenses in so doing. Should it appear
desirable to do so in order to ensure adequate representation of shares at the
meeting, officers, agents and employees of the Company may communicate with
stockholders, banks, brokerage houses and others by telephone, facsimile or in
person to request that proxies be furnished. All expenses incurred in connection
with this solicitation will be borne by the Company. The Company has no present
plans to hire special employees or paid solicitors to assist in obtaining
proxies, but reserves the option of doing so if it should appear that a quorum
otherwise might not be obtained.
Revocability and Voting of Proxy
A form of proxy for use at the Annual Meeting of Stockholders and a return
envelope for the proxy are enclosed. Stockholders may revoke the authority
granted by their execution of proxies at any time before their effective
exercise by filing with the Secretary of the Company a written notice of
revocation or a duly executed proxy bearing a later date, or by voting in person
at the meeting. Shares of the Company's Common Stock represented by executed and
unrevoked proxies will be voted in accordance with the choice or instructions
specified thereon. If no specifications are given, the proxies intend to vote
the shares represented thereby to approve Proposal No. 1 as set forth in the
accompanying Notice of Annual Meeting of Stockholders and in accordance with
their best judgment on any other matters which may properly come before the
meeting.
<PAGE>
Record Date and Voting Rights
Only stockholders of record at the close of business on March 15, 1999 are
entitled to notice of and to vote at the Annual Meeting or any and all
adjournments thereof. On March 15, 1999 there were 5,117,680 shares of Common
Stock outstanding; each such share is entitled to one vote on each matter to be
presented at the Annual Meeting. The holders of a majority of the outstanding
shares of Common Stock, present in person or by proxy and entitled to vote, will
constitute a quorum at the Annual Meeting. Abstentions and broker non-votes will
be counted for purposes of determining the presence or absence of a quorum.
"Broker non-votes" are shares held by brokers or nominees which are present in
person or represented by proxy, but which are not voted on a particular matter
because instructions have not been received from the beneficial owner. Under
applicable Delaware law, the effect of broker non-votes on a particular matter
depends on whether the matter is one as to which the broker or nominee has
discretionary voting authority under the applicable rule of the New York Stock
Exchange. Only votes cast for a nominee will be counted, except that the
accompanying proxy will be voted for all nominees in the absence of instruction
to the contrary. Abstentions, broker non-votes and instructions on the
accompanying proxy card to withhold authority to vote for one or more nominees
will result in the respective nominees receiving fewer votes. However, the
number of votes otherwise received by the nominee will not be reduced by such
action.
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<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth information as of February 1, 1999 (except
as otherwise noted in the footnotes), regarding the beneficial ownership
(determined in accordance with the rules of the Securities and Exchange
Commission (the "SEC"), which generally attributes beneficial ownership of
securities to persons who possess sole or shared voting power and/or investment
power with respect to those securities) of the Company's Common Stock of: (i)
each person known by the Company to own beneficially more than five percent of
the Company's outstanding Common Stock; (ii) each director and nominee for
director of the Company; (iii) each executive officer named in the Summary
Compensation Table (see "Executive Compensation"); and (iv) all directors and
executive officers of the Company as a group. Except as otherwise specified, the
named beneficial owner has the sole voting and investment power over the shares
listed.
<TABLE>
<CAPTION>
Amount and Nature of
Beneficial Ownership of Percentage of
Name of Beneficial Owner Common Stock Common Stock
- ------------------------ ------------------------ ------------
<S> <C> <C>
Neuberger & Berman, LLC(1).......................... 521,700 9.9%
SAFECO Corporation (2).............................. 510,100 9.7%
Heartland Advisors, Inc.(3)......................... 500,000 9.5%
Marvin Schwartz(4).................................. 333,700 6.4%
Wellington Management Company, LLP(5)............... 286,000 5.4%
Robert T. Ammerman(6)............................... 196,463 3.6%
Harold J. Levy(7)................................... 22,632 *
Douglas L. Newhouse(8).............................. 86,717 1.6%
Ralph S. Saul(9).................................... 5,875 *
William L. Selden(10)............................... 117,312 2.2%
Robert F. Shapiro(7)................................ 17,375 *
Kendrick R. Wilson III(11).......................... 16,375 *
R. Charles Blackmon(12)............................. 64,768 1.2%
William R. Buchholz(13)............................. 49,302 *
Roy L. Smith(13).................................... 50,621 1.0%
Joel R. Voelkert(13)................................ 91,787 1.7%
All directors and executive officers as a group
(12 persons)(14)................................. 644,854 11.3%
</TABLE>
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* Less than 1%
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<PAGE>
(1) The amount and nature of beneficial ownership of Common Stock is based on
information set forth in a Schedule 13G dated February 5, 1999 filed by the
beneficial owner. The Schedule 13G states that such beneficial owner has
sole voting power with respect to 348,400 shares and shared dispositive
power with respect to 521,700 shares. The Schedule 13G states that it does
not include 67,000 shares owned by principals of Neuberger & Berman, LLC,
and notes that Marvin Schwartz, a principal of Neuberger & Berman, LLC, is
deemed to be the beneficial owner of 333,700 shares. (See note 4 below).
The address of such beneficial owner is 605 Third Avenue, New York, NY
10158.
(2) The amount and nature of beneficial ownership of Common Stock is based on
information set forth in a Schedule 13G dated February 11, 1999 filed by
SAFECO Corporation ("SAFECO"), SAFECO Asset Management Company ("SAMCO")
and SAFECO Common Stock Trust (the "Trust"). The Schedule 13G states that
SAFECO disclaims beneficial ownership of the shares reported on the
Schedule 13G, which are owned beneficially by registered investment
companies for which a subsidiary of SAFECO serves as an adviser. The
Schedule 13G states that SAMCO disclaims beneficial ownership of the shares
reported on the Schedule 13G, which are owned beneficially by registered
investment companies for which SAMCO serves as an adviser. The Schedule 13G
states that the Trust beneficially owns 360,400 shares (6.9%). Such
entities share voting and dispositive power with respect to such shares.
The address of SAFECO and SAMCO is SAFECO Plaza, Seattle, WA 98185 and the
address of the Trust is 10865 Willows Road, NE, Redmond, WA 98052.
(3) The amount and nature of beneficial ownership of Common Stock is based on
information set forth in a Schedule 13G dated January 19, 1999 filed by the
beneficial owner. The Schedule 13G states that the shares are held in
investment advisory accounts of Heartland Advisors, Inc., and that the
interests of one such account, Heartland Value Fund, a series of Heartland
Group, Inc., a registered investment company, relates to more than 5% of
the class. The Schedule 13G states that the beneficial owner has sole
dispositive power with respect to such shares. The address of such
beneficial owner is 790 North Milwaukee Street, Milwaukee, WI 53202.
(4) The amount and nature of beneficial ownership of Common Stock is based on
information set forth in a Schedule 13D filed November 7, 1997 by the
beneficial owner. The Schedule 13D states that Mr. Schwartz has sole voting
and dispositive power with respect to 106,300 shares and shared dispositive
power with respect to 227,400 shares. The Schedule 13D states that 47,000
shares are owned by Mr. Schwartz for his personal account, and 286,700
shares are beneficially owned as follows: 59,300 shares are owned by the
N&B Profit Sharing Trust, over which Mr. Schwartz has sole dispositive and
voting power, and 227,400 shares are held in accounts for the benefit of
Mr. Schwartz's family, for which shares he has shared dispositive power.
The address of such beneficial owner is c/o Neuberger & Berman, LLC, 605
Third Avenue, New York, NY 10158.
(5) The amount and nature of beneficial ownership of Common Stock is based on
information set forth in a Schedule 13G dated February 9, 1999 filed by the
beneficial owner. The Schedule 13G states that such beneficial owner shares
voting power with respect to 119,000 shares and dispositive power with
respect to 286,000 shares. The address of such beneficial owner is 75 State
Street, Boston, MA 02109.
(6) Includes 149,071 shares of Common Stock issuable pursuant to options which
are exercisable within 60 days of February 1, 1999. Does not include shares
of Common Stock issuable pursuant to options which are not exercisable
within 60 days of February 1, 1999.
(7) Includes 12,375 shares of Common Stock issuable pursuant to options which
are exercisable within 60 days of February 1, 1999. Does not include shares
of Common Stock issuable pursuant to options which are not exercisable
within 60 days of February 1, 1999.
(8) Includes 9,125 shares issuable pursuant to options which are exercisable
within 60 days of February 1, 1999 and 77,592 shares which are owned by
Sterling ABC/Metbuild Corporation ("Sterling ABC"), a corporation in which
Mr. Newhouse owns one-third of the outstanding shares. Mr. Newhouse
disclaims beneficial ownership of the shares owned by Sterling ABC, other
than the shares in which he has a pecuniary interest. Does not include
shares of Common Stock issuable pursuant to options which are not
exercisable within 60 days of February 1, 1999.
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<PAGE>
(9) Consists of 4,875 shares of Common Stock issuable pursuant to options which
are exercisable within 60 days of February 1, 1999 and 1,000 shares which
are owned by a charitable remainder trust. Does not include shares of
Common Stock issuable pursuant to options which are not exercisable within
60 days of February 1, 1999.
(10) Includes 17,375 shares issuable pursuant to options which are exercisable
within 60 days of February 1, 1999 and 77,592 shares which are owned by
Sterling ABC, a corporation in which Mr. Selden owns one-third of the
outstanding shares. Mr. Selden disclaims beneficial ownership of the shares
owned by Sterling ABC, other than the shares in which he has a pecuniary
interest. Does not include shares of Common Stock issuable pursuant to
options which are not exercisable within 60 days of February 1, 1999.
(11) Includes 12,375 shares of Common Stock issuable pursuant to options which
are exercisable within 60 days of February 1, 1999. Does not include shares
of Common Stock issuable pursuant to options which are not exercisable
within 60 days of February 1, 1999. Mr. Wilson is not standing for
re-election as a Director.
(12) Includes 62,768 shares of Common Stock issuable pursuant to options which
are exercisable within 60 days of February 1, 1999. Does not include shares
of Common Stock issuable pursuant to options which are not exercisable
within 60 days of February 1, 1999.
(13) Consists of shares of Common Stock issuable pursuant to options which are
exercisable within 60 days of February 1, 1999. Does not include shares of
Common Stock issuable pursuant to options which are not exercisable within
60 days of February 1, 1999.
(14) Includes 77,592 shares owned by Sterling ABC, 1,000 shares owned by a
charitable remainder trust and 462,893 shares issuable pursuant to options
which are exercisable within 60 days of February 1, 1999. Does not include
shares of Common Stock issuable pursuant to options which are not
exercisable within 60 days of February 1, 1999.
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<PAGE>
PROPOSAL NO. 1--ELECTION OF DIRECTORS
Six directors (constituting the entire Board) are to be elected at the
Annual Meeting. Unless otherwise specified, the enclosed proxy will be voted in
favor of the persons named below to serve until the next annual meeting of
stockholders and until their successors shall have been duly elected and shall
qualify. In the event any of these nominees shall be unable to serve as a
director, the shares represented by the proxy will be voted for the person, if
any, who is designated by the Board of Directors to replace the nominee. All
nominees have consented to be named and have indicated their intent to serve if
elected. The Board of Directors has no reason to believe that any of the
nominees will be unable to serve or that any vacancy on the Board of Directors
will occur.
The nominees, their ages, the year in which each first became a director
and their principal occupations or employment during the past five years are:
Year First Principal Occupation
Nominee Age Became Director During the Past Five Years
- ------- --- --------------- --------------------------
Robert T. Ammerman 59 1992 Chief Executive Officer and a
director since joining the Company
in July 1992 and President from
July 1992 to August 1996. From 1973
until he joined the Company, Mr.
Ammerman was employed by United
Dominion Industries, Inc. and its
affiliates, including Varco-Pruden
Buildings, a manufacturer of metal
buildings. Mr. Ammerman served in
various capacities, including
Vice-President/General Manager
Eastern Division of Varco-Pruden
Buildings and President of the
Buildings segment of United
Dominion Industries, Inc., which
included Varco-Pruden Buildings,
Stran Buildings and AEP/Span. Mr.
Ammerman was Chairman and a member
of the Executive Committee of the
Metal Building Manufacturers
Association, an industry trade
association, in 1995.
William L. Selden 51 1993 Director of the Company since
January 1993 and Chairman of the
Board of Directors of the Company
since February 1993. Mr. Selden is
a partner and co-founder of
Sterling Ventures Limited, a
company formed in 1991 for the
purpose of making private equity
investments. Mr. Selden is Chairman
of the Board of Directors of
Tidewater Holdings, Inc. and a
director of McArthur/Glen Europe
Holdings, Ltd.
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<PAGE>
Year First Principal Occupation
Nominee Age Became Director During the Past Five Years
- ------- --- --------------- --------------------------
Harold Levy 45 1993 Director of the Company since
January 1993. Mr. Levy is a
Principal of Iridian Asset
Management. Prior to co-founding
Iridian Asset Management in April
1996, Mr. Levy was Senior Vice
President at Arnhold and S.
Bleichroeder Inc. from September
1991 until March 1996 and was Vice
President from December 1984 to
September 1991. Mr. Levy is a
director of Assistive Technology
and Triac Corp.
Douglas L. Newhouse 45 1993 Director of the Company since
January 1993. Mr. Newhouse is a
partner and co-founder of Sterling
Ventures Limited. Prior to
co-founding Sterling Ventures in
1991, Mr. Newhouse was President of
Middex Capital Corp., which
specialized in the acquisition of
middle market companies, for one
and one-half years. Prior to his
employment with Middex, Mr.
Newhouse was a Senior Vice
President in the Corporate Finance
Department of Lehman Brothers, Inc.
Ralph S. Saul 76 1993 Director of the Company since May
1993. Mr. Saul is also a director
of Horace Mann Educators Corp., and
Knoxn Co.. Mr. Saul was Chairman
and co-Chief Executive Officer of
CIGNA Corp. from 1982 to 1985 and
was President of the American Stock
Exchange from 1966 to 1971.
Robert F. Shapiro 64 1993 Director of the Company since May
1993. Mr. Shapiro is a partner of
Klingenstein, Fields & Co., L.L.C.
and the President of RFS &
Associates, a private investment
and consulting firm. He is also an
independent general partner of
Equitable Capital Partners and
currently is a director of the TJX
Companies, Inc., The Burnham Fund,
Inc. and Magainin Pharmaceuticals.
Mr. Shapiro was formerly a
co-Chairman of Wertheim Schroder &
Co. Incorporated, an investment
banking firm, a director of
Schroders PLC, Chairman of New
Street Capital Corp., a director of
Lehman Brothers, Inc., a Governor
of the American Stock Exchange and
a Chairman of the Securities
Industry Association.
All directors hold office until the next meeting of the stockholders of the
Company and until their successors are elected and qualified.
The Board of Directors has a Finance and Audit Committee which is charged
with reviewing the Company's internal accounting procedures, consulting with and
reviewing the selection of the Company's independent auditors and reviewing the
Company's financing needs. The Finance and Audit Committee currently consists of
Messrs. Newhouse, Saul and Shapiro. During 1998, the Finance and Audit Committee
met twice. The Board of Directors also has a Compensation
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<PAGE>
Committee charged with recommending to the Board the compensation for the
Company's executives. The Compensation Committee is currently composed of
Messrs. Newhouse and Shapiro. During 1998, the Compensation Committee met once.
The Board of Directors has also established an Executive Committee charged with
exercising powers of the Board of Directors expressly delegated to it. The
Executive Committee is currently composed of Messrs. Ammerman, Levy and Selden.
The Executive Committee did not act during 1998.
During the fiscal year ended December 31, 1998, the Board of Directors held
four meetings. Each director attended at least 75% of the meetings of the Board
of Directors held when he was a Director and of all committees of the Board of
Directors on which he served.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's executive officers and directors, and
persons who beneficially own more than ten percent of the Company's Common
Stock, to file initial reports of ownership and reports of changes in ownership
with the SEC and the National Association of Securities Dealers, Inc. Executive
officers, directors and greater than ten percent beneficial owners are required
by SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file.
Based upon a review of the copies of such forms furnished to the Company
and written representations from the Company's executive officers and directors,
the Company believes that during fiscal 1998 all Section 16(a) filing
requirements applicable to its executive officers, directors and greater than
ten percent beneficial owners were complied with.
Vote Required
The six nominees receiving the highest number of affirmative votes of the
shares present in person or represented by proxy and entitled to vote for them,
a quorum being present, shall be elected as directors. Only votes cast for a
nominee will be counted, except that the accompanying proxy will be voted for
all nominees in the absence of instruction to the contrary. Abstentions, broker
non-votes and instructions on the accompanying proxy card to withhold authority
to vote for one or more nominees will result in the respective nominees
receiving fewer votes. However, the number of votes otherwise received by the
nominee will not be reduced by such action.
THE BOARD OF DIRECTORS DEEMS "PROPOSAL NO. 1-ELECTION OF DIRECTORS" TO BE
IN THE BEST INTERESTS OF THE COMPANY AND ITS STOCKHOLDERS AND RECOMMENDS A VOTE
"FOR" APPROVAL THEREOF.
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<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information concerning all cash and non-cash
compensation paid or to be paid by the Company as well as certain other
compensation awarded, earned by and paid, during the fiscal years indicated, to
the President and Chief Executive Officer and each of the four other most highly
compensated executive officers of the Company for such period in all capacities
in which they served.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term Compensation
Annual Compensation Awards
---------------------------------------- --------------------------
All
Securities Other
Name and Principal Underlying Compen-
Position Year Salary Bonus(1) Options/SARs sation(2)
-------- ---- ------ -------- ------------ ---------
<S> <C> <C> <C> <C> <C>
Robert T. Ammerman
Chief Executive Officer .......................... 1998 $400,000 $171,716(3) -- $10,921
1997 250,000 305,777 45,000 10,323
1996 250,000 14,805 -- 8,525
Joel R. Voelkert
President-Construction
Products Group ................................... 1998 210,000 67,771 -- 11,149
1997 191,400 175,568 19,000 12,001
1996 166,400 8,488 -- 8,455
R. Charles Blackmon
Executive Vice President-Chief
Financial Officer ................................ 1998 165,000 54,618(3) -- 8,002
1997 142,000 103,431 24,000 9,559
1996 122,500 3,880 -- 3,101
William R. Buchholz
Vice President-Operations ........................ 1998 152,500 38,547 -- 10,855
1997 134,300 97,944 10,000 10,671
1996 125,500 3,852 -- 9,296
Roy L. Smith
President, Polymer Coil Coaters .................. 1998 125,000 76,633(4) -- 6,341
1997 116,700 94,308(4) 9,000 9,166
1996 112,200 53,914(4) -- 4,814
</TABLE>
- ----------
(1) For each of 1998, 1997, and 1996, represents bonuses paid during the
following year for services rendered in that year. In 1996, the Company
adopted a shareholder value added plan for key senior and middle management
executives. The plan entitles participants to receive cash bonuses based on
a fixed percentage of Shareholder Value Added (as defined in the plan) and
the change in Shareholder Value Added. Does not include amounts allocated
to the Shareholder Value Added plan's bank, which amounts are subject to
change based on the Company's performance and will be paid in future years
if the individual remains with the Company. At December 31, 1998, the bank
balance for Messrs. Ammerman, Voelkert, Blackmon, Buchholz and Smith was
$74,370, $42,692, $24,309, $23,154, and $8,846, respectively.
(2) Includes the Company's contributions to the American Buildings Company
Savings Plan (the "Savings Plan") of $4,125, $5,113, $5,091, $5,096 and
$3,805 in 1998, $5,563, $6,552, $5,413, $5,136 and $6,516 in 1997 and
$3,174, $4,880, $4,608, $4,347 and $4,814 in 1996 to Messrs. Ammerman,
Voelkert, Blackmon, Buchholz and Smith, respectively. The Company is
obligated to contribute at least 25% of the amount of compensation elected
to be deferred by such individual; however, the Company has the opportunity
to increase this amount. In addition, the Company is required to contribute
1% of its eligible gross payroll to participants in the Savings Plan
pursuant to a formula based on compensation and years of service (the
"Additional Contribution"). In 1996, 1997
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<PAGE>
and 1998, the Company contributed 25%, 40% and 25% of the amount of
compensation elected to be deferred by each named individual plus the
Additional Contribution to each named individual. The balance of the
amounts in this column consists of insurance premiums on term life
insurance paid by the Company for the benefit of the named individuals and
a car allowance for each of Ammerman, Voelkert, Blackmon, Buchholz and
Smith.
(3) Includes bonuses paid from the Windsor Door shareholder value added plan in
1999 for services rendered in 1998 of $16,626 and $5,987 for Messrs.
Ammerman and Blackmon, respectively.
(4) Includes a bonus of $63,000 paid in 1999 based on the Polymer Coil Coater
division's 1998 performance, a bonus of $58,500 paid in 1998 based on that
division's 1997 performance and a bonus of $52,000 paid in 1997 based on
that division's 1996 performance.
Stock Options
No grants of stock options were made during the year ended December 31,
1998 to the persons named in the Summary Compensation Table. However, on January
19, 1999, the Company granted options to purchase an aggregate of 30,000 shares,
15,000 shares, 15,000 shares, 5,000 shares and 15,000 shares to each of Messrs.
Ammerman, Voelkert, Blackmon, Buchholz and Smith, respectively, at an exercise
price of $23.50 per share, equal to the closing price of the Common Stock on the
date of grant. The options are exercisable in four equal annual installments
commencing January 19, 2000.
The following table sets forth the aggregate options exercised during the
year ended December 31, 1998 and the number of securities underlying unexercised
options and the value of unexercised options held by each of the executive
officers named in the Summary Compensation Table at December 31, 1998:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Shares Value Options at Year End Options at Year End(1)
Acquired Realized ---------------------------- ------------------------------
Name on Exercise ($) Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- --- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Robert T. Ammerman......... 0 0 145,321 38,750 $ 1,805,014 $0
Joel R. Voelkert........... 0 0 89,537 16,250 1,217,774 0
R. Charles Blackmon........ 0 0 60,518 20,000 652,727 0
William R. Buchholz........ 6,027 143,169 48,052 9,000 542,310 0
Roy L. Smith............... 0 0 49,621 7,750 606,433 0
</TABLE>
- ----------
(1) Computed based upon the difference between the stock option exercise price
and the closing price of the Company's Common Stock on December 31, 1998
($24.50).
Management Retirement and Death Benefit Plan
The Company has a noncontributory retirement and death benefit plan which
covers certain management employees. The plan provides a death benefit if a
covered employee dies prior to reaching retirement age, as defined by the plan,
to be paid over a minimum ten-year period and a mutually exclusive retirement
benefit, after reaching the defined retirement age, to be paid over a ten-year
period. Termination of employment with the Company for any reason prior to
reaching this defined retirement age results in plan members forfeiting all
benefit rights and claims. Benefits under
-10-
<PAGE>
this plan do not vest until retirement or, if earlier, death, and the Company
has the right to modify or terminate this plan at any time.
Employment Agreements
The Company has entered into employment agreements, effective as of January
1, 1998, with each of Robert Ammerman, Charles Blackmon, William Buchholz, Roy
Smith and Joel Voelkert for terms ending December 31, 2000. Each of the
foregoing agreements (collectively, the "Employment Agreements") provides for
automatic renewal for successive one year terms unless either party notifies the
other to the contrary at least 90 days prior to its expiration. The agreements
require each employee to devote substantially all of his time and attention to
the business of the Company as necessary to fulfill his duties. The agreements
provide for the payment of a base salary for 1999 to Messrs. Ammerman, Blackmon,
Buchholz, Smith and Voelkert at a rate of $412,000, $170,000, 160,000, $132,000
and $215,000, respectively. Mr. Ammerman's agreement also provides for minimum
annual salary increases based on increases in the cost of living. The agreements
also provide for the payment of bonuses in such amounts as may be determined by
the Board. Under the agreements, the employee may terminate his employment upon
30 days' notice. The agreements provide that in the event the employee's
employment is terminated by the Company at any time for any reason other than
justifiable cause, disability or death, the Company shall pay the employee the
employee's base salary and permit participation in benefit programs for the
greater of (i) the remaining term of the agreement or (ii) one year (two years
in the case of Mr. Ammerman); however, if such termination occurs at any time
within one year following a "Change of Control of the Company," the Company
shall pay the employee a lump sum payment equal to two years' annual salary plus
an amount equal to twice the employee's most recently declared bonus, and permit
participation in benefit programs for the period specified above. The Employment
Agreements also provide that in the event the Company chooses not to renew the
agreement, the Company shall pay the employee his base salary for a period of
one year. Each agreement contains confidentiality provisions, whereby each
executive agrees not to disclose any confidential information regarding the
Company, as well as non-competition covenants. The non-competition covenants
survive the termination of an employee's employment for the greater of (i) the
remaining term of the agreement or (ii) two years, except in the event the
Company elects not to renew the agreement, terminates the employee's employment
within one year following a "Change in Control of the Company" or fails to make
required severance payments.
For purposes of the Employment Agreements, a "Change in Control of the
Company" shall be deemed to occur if (i) there shall be consummated (x) any
consolidation or merger of the Company in which the Company is not the
continuing or surviving corporation or pursuant to which shares of the Company's
Common Stock would be converted into cash, securities or other property, other
than a merger of the Company in which the holders of the Company's Common Stock
immediately prior to the merger have the same proportionate ownership of common
stock of the surviving corporation immediately after the merger, or (y) any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all, or substantially all, of the assets of the
Company, or (ii) the stockholders of the Company shall approve any plan or
proposal for liquidation or dissolution of the Company, or (iii) any person (as
such term is used in Sections 13(d) and 14(d)(2) of the Exchange Act), shall
become the beneficial owner (within the meaning of Rule 13d-3 under
-11-
<PAGE>
the Exchange Act) of 40% or more of the Company's outstanding Common Stock other
than pursuant to a plan or arrangement entered into by such person and the
Company, or (iv) during any period of two consecutive years, individuals who at
the beginning of such period constitute the entire Board of Directors shall
cease for any reason to constitute a majority thereof unless the election, or
the nomination for election by the Company's stockholders, of each new director
was approved by a vote of at least two-thirds of the directors then still in
office who were directors at the beginning of the period.
The Employment Agreements also provide that if, in connection with a change
of ownership or control of the Company or a change in ownership of a substantial
portion of the assets of the Company (all within the meaning of Section
280G(b)(2) of the Internal Revenue Code of 1986, as amended (the "Code")), an
excise tax is payable by the employee under Section 4999 of the Code, then the
Company will pay to the employee additional compensation which will be
sufficient to enable the employee to pay such excise tax as well as the income
tax and excise tax on such additional compensation, such that, after the payment
of income and excise taxes, the employee is in the same economic position in
which he would have been if the provisions of Section 4999 of the Code had not
been applicable.
Compensation of Directors
Each non-employee director of the Company (other than Messrs. Newhouse and
Selden) receives a director's fee of $2,500 per quarter, plus $750 per meeting
attended and $750 per telephonic meetings attended. In addition, directors who
are not employees of the Company are compensated through stock options. Messrs.
Newhouse and Selden are partners of Sterling Ventures Limited ("Sterling"),
which receives an annual management fee from the Company.
The Company has adopted a Stock Option Plan for Non-Employee Directors (the
"Directors' Option Plan"), pursuant to which options to acquire a maximum of
260,000 shares of Common Stock may be granted to non-employee directors. Options
granted under the Directors' Option Plan do not qualify as incentive stock
options within the meaning of Section 422 of the Code. The Directors' Option
Plan provided that upon adoption of the plan, each of Messrs. Levy, Newhouse,
Saul, Selden, Shapiro and Wilson, its current non-employee directors, was
granted an option to purchase 7,500 shares of Common Stock at a purchase price
per share equal to the initial public offering price of the Common Stock
($10.00). The Directors' Option Plan provides for the automatic grant to each of
the Company's non-employee directors of (1) an option to purchase 7,500 shares
of Common Stock on the date of such director's initial election or appointment
to the Board of Directors (the "Initial Grant"), and (2) an option to purchase
5,000 shares of Common Stock (1,500 shares prior to 1999) on each annual
anniversary of such election or appointment, provided that such individual is a
non-employee director on such anniversary date (the "Additional Grant"). The
options have an exercise price of 100% of the fair market value of the Common
Stock on the date of grant and have a ten-year term. The Initial Grant becomes
exercisable in four equal installments on the six month anniversary of the date
such person was first elected or appointed to the Board of Directors and on the
first, second and third anniversary of the date of such election or appointment.
The Additional Grant becomes exercisable in four equal installments on the six
month anniversary of the date of each Additional Grant and on the first, second
and third anniversary of the date of such Additional Grant. The options may be
exercised by payment in cash, check or shares of Common Stock. On February
-12-
<PAGE>
25, 1996, 1997 and 1998, each of Messrs. Levy, Newhouse, Saul, Selden, Shapiro
and Wilson was granted an option to purchase 1,500 shares of Common Stock at a
purchase price of $21.125, $27.00 and $29.625 respectively, the closing price of
the Common Stock on such dates, and on February 25, 1999 each non-employee
director was granted an option to purchase 5,000 shares of Common Stock at a
purchase price of $20.563, the closing price of the Common Stock on such date,
under the Directors' Option Plan.
-13-
<PAGE>
Compensation Committee Report to Stockholders
The report of the Compensation Committee (the "Compensation Committee")
shall not be deemed incorporated by reference by any general statement
incorporating by reference this proxy statement into any filing under the
Securities Act of 1933, as amended (the "Securities Act"), or under the Exchange
Act, except to the extent that the Company specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.
The Compensation Committee of the Board of Directors was formed in February
1993 and consists of Messrs. Newhouse and Shapiro, each of whom is an
independent non-employee director. The Compensation Committee administers the
Company's executive compensation programs, monitors corporate performance and
its relationship to compensation of executive officers, and makes appropriate
recommendations concerning matters of executive compensation.
Compensation Philosophy
The Company believes that executive compensation should be closely related
to increased stockholder value. One of the Company's strengths contributing to
its successes is a strong management team, many of whom have been with the
Company for a large number of years. The Committee believes that low executive
turnover has been instrumental to the Company's success, and that the Company's
compensation program has played a major role in limiting executive turnover. The
compensation program is designed to enable the Company to attract, retain and
reward capable employees who can contribute to the continued success of the
Company, principally by linking compensation with the attainment of key business
objectives. Equity participation and a strong alignment to stockholders'
interests are key elements of the Company's compensation philosophy.
Accordingly, the Company's executive compensation program is designed to provide
competitive compensation, support the Company's strategic business goals and
reflect the Company's performance.
The compensation program reflects the following principles:
o Compensation should encourage increased stockholder value.
o Compensation programs should support the short- and long-term
strategic business goals and objectives of the Company.
o Compensation programs should reflect and promote the Company's values
and reward individuals for outstanding contributions toward business
goals.
o Compensation programs should enable the Company to attract and retain
highly qualified professionals.
-14-
<PAGE>
Pay Mix and Measurement
The Company's executive compensation is comprised of two components, base
salary and incentives, each of which is intended to serve the overall
compensation philosophy.
Base Salary
The Company's salary levels are intended to be consistent with competitive
pay practices and level of responsibility, with salary increases reflecting
competitive trends, the overall financial performance and resources of the
Company, general economic conditions as well as a number of factors relating to
the particular individual, including the performance of the individual
executive, and level of experience, ability and knowledge of the job.
Incentives
Incentives consist of cash awards and stock options. Cash awards are paid
under the Company's incentive bonus plan to key senior and middle management
executives. Beginning with 1996, the Company adopted a Shareholder Value Added
Plan that entitles participants to receive cash bonuses based on an annual
aggregate award plus any deferred award balance from the award bank.
Contributions to the annual aggregate award and the award bank are based on a
fixed percentage of the Shareholder Value Added ("SVA") plus a fixed percentage
of the annual change in SVA. SVA is defined as the amount that Net Operating
Profit After Taxes ("NOPAT") exceeds a capital charge, which is calculated as
Capital Employed (as defined in the plan) multiplied by the associated Cost of
Capital (as defined in the plan). Each participant's share is based on a
specified percentage of their salary in relation to the other participants. For
1998, cash awards equal to 42.9%, 32.3%, 33.1%, 25.3% and 10.9% of their
respective salaries were paid to Messrs. Ammerman, Voelkert, Blackmon, Buchholz
and Smith, respectively. In addition, Mr. Smith received a bonus based on the
results of the Polymer Coil Coaters Division equal to 50.4% of his salary. Stock
options are granted from time to time to reward key employees' contributions.
The Committee strongly believes that the pay program should provide
employees with an opportunity to increase their ownership and potentially gain
financially from Company stock price increases. By this approach, the best
interests of stockholders, executives and employees will be closely aligned.
Therefore, executives and other employees are eligible to receive stock options,
giving them the right to purchase shares of Common Stock of the Company at a
specified price in the future. The grant of options is based primarily on a key
employee's potential contribution to the Company's growth and profitability,
based on the Committee's discretionary evaluation. Options are granted at the
prevailing market value of the Company's Common Stock and will only have value
if the Company's stock price increases. Generally, grants of options vest over a
period of time and executives must be employed by the Company for such options
to vest.
Chief Executive Officer 1998 Compensation
The base salary for Robert T. Ammerman, the Company's Chief Executive
Officer, was $400,000 during the Company's fiscal year ended December 31, 1998.
Such base salary of $400,000 was increased $150,000 from Mr. Ammerman's 1997
base salary. In 1998 Mr. Ammerman
-15-
<PAGE>
also received a cash bonus of $171,716 for services rendered in 1998, of which
$155,090 was earned pursuant to the shareholder value added plan described above
and $16,626 was earned pursuant to a similar shareholder value added plan for
the Windsor Door division. The increase in base salary for 1998 was made in
recognition of the Company's 1997 performance and Mr. Ammerman's role in such
performance, the increased size of the Company as a result of the Company's
acquisition of the Windsor Door division of United Dominion Industries, Inc. and
the fact that Mr. Ammerman's salary was not increased in 1997 from his 1996
salary. Mr. Ammerman was not granted any options in 1998 in light of the two
option grants, totaling 45,000 shares, made to Mr. Ammerman in 1997. In January
1999, Mr. Ammerman was granted options to purchase 30,000 shares of Common Stock
at an exercise price of $23.50 per share. These options become exercisable in
four equal annual installments on the anniversary date of the grant.
The aggregate compensation paid to Mr. Ammerman was deemed appropriate by
the Compensation Committee considering the overall performance of the Company
and Mr. Ammerman.
Tax Effects
Changes made in 1993 to the Internal Revenue Code of 1986, as amended (the
"Code"), impose certain limitations on the deductibility of executive
compensation paid by public companies. In general, under the limitations, the
Company will not be able to deduct annual compensation paid to certain executive
officers in excess of $1,000,000 except to the extent that such compensation
qualifies as "performance-based compensation" (or meets other exceptions not
here relevant). Non-deductibility would result in additional tax cost to the
Company. It is possible that at least some of the cash and equity-based
compensation paid or payable to the Company's executive officers will not
qualify for the "performance-based compensation" exclusion under the deduction
limitation provisions of the Code. Nevertheless, the Committee anticipates that
in making compensation decisions it will give consideration to the net cost to
the Company (including, for this purpose, the potential limitation on
deductibility of executive compensation).
The Compensation Committee believes that linking executive compensation to
corporate performance results in a better alignment of compensation with
corporate business goals and stockholder value. The Committee believes its
compensation practices are directly tied to stockholder returns and linked to
the achievement of annual and longer-term financial and operational results of
the Company on behalf of the Company's stockholders. In view of the Company's
performance and achievement of goals and competitive conditions, the
Compensation Committee believes that compensation levels during 1998 adequately
reflect the Company's compensation goals and policies.
COMPENSATION COMMITTEE
Douglas L. Newhouse
Robert F. Shapiro
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<PAGE>
Compensation Committee Interlocks and Insider Participation
On February 18, 1993, the Company's Board of Directors established a
Compensation Committee, which currently consists of Messrs. Newhouse and
Shapiro, to recommend compensation for the Company's executives.
On February 25, 1998 each of Messrs. Newhouse and Shapiro was granted an
option to purchase 1,500 shares of the Company's Common Stock pursuant to the
Directors' Option Plan. On February 25, 1999 each above-named non-employee
director was granted an option to purchase 5,000 shares of the Company's Common
Stock pursuant to the Directors' Option Plan See "Compensation of Directors."
In connection with the recapitalization of the Company in January 1993, the
Company entered into a management agreement with Sterling pursuant to which
Sterling agreed to provide financial and management consulting services to the
Company for a fee of $275,000 per annum plus reimbursement of direct
out-of-pocket costs and expenses. In connection with the Company's acquisition
of the Windsor Door division of United Dominion Industries, Inc. the Company and
Sterling amended the management agreement to increase the fee thereunder to
$375,000 per annum in recognition of Sterling's increased responsibilities
resulting from the increased size of the Company following the acquisition. Each
of Messrs. Newhouse and Selden is an officer, director and holder of one-third
of the shares of Sterling.
The Company's Performance
The Stock Price Performance Graph below shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act or under the Exchange Act,
except to the extent the Company specifically incorporates this information by
reference, and shall not otherwise be deemed filed under such Acts.
-17-
<PAGE>
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
AMONG AMERICAN BUILDINGS COMPANY,
NASDAQ MARKET INDEX AND PEER GROUP INDEX
[GRAPHICAL REPRESENTATION OF DATA BELOW]
<TABLE>
<CAPTION>
FISCAL YEAR ENDING
-----------------------------------------------------------------------
COMPANY/INDEX/MARKET 4/29/1994 12/30/1994 12/29/1995 12/31/1996 12/31/1997 12/31/1998
- -------------------- --------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
American Buildings 100.00 166.25 225.00 238.75 252.50 245.00
Peer Group Index 100.00 116.73 194.93 215.87 197.85 210.98
NASDAQ Market Index 100.00 101.44 131.58 163.51 200.01 282.10
</TABLE>
The above Graph compares the performance of the Company from April 29,
1994, the date that the Company's Common Stock commenced trading on the Nasdaq
National Market, through December 31, 1998, against the performance of the
Nasdaq Market Index and the Company's Peer Group (SIC Code Index) for the same
period. The companies included in the Company's Peer Group are Butler
Manufacturing Company, Mark Solutions Inc., Miller Building Systems Inc. and NCI
Building Systems, Inc. United Dominion Industries, Inc., which was in the
Company's Peer Group last year, was not included this year because it has
disposed of all of its metal building systems and related operations.
-18-
<PAGE>
RELATIONSHIP WITH INDEPENDENT AUDITORS
Arthur Andersen LLP have been the independent auditors for the Company
since December 1990 and will serve in that capacity for the 1999 fiscal year. A
representative of Arthur Andersen L.L.P. will be present (either in person or by
telephone) at the Annual Meeting and will have an opportunity to make a
statement if he desires to do so, and will respond to appropriate questions from
stockholders.
STOCKHOLDER PROPOSALS
Stockholder proxies obtained by the Board of Directors in connection with
the annual meeting of stockholders in the year 2000 will confer on the
proxyholders discretionary authority to vote on any matters presented at the
meeting which were not included in the proxy statement, unless notice of the
matter to be presented at the meeting is provided to the Company's Corporate
Secretary no later than February 10, 2000.
All stockholder proposals which are intended to be presented at the 2000
Annual Meeting of Stockholders of the Company must be received by the Company no
later than November 26, 1999 for inclusion in the Board of Directors' proxy
statement and form of proxy relating to that meeting.
OTHER BUSINESS
The Board of Directors knows of no other business to be acted upon at the
Annual Meeting. However, if any other business properly comes before the Annual
Meeting, it is the intention of the persons named in the enclosed proxy to vote
on such matters in accordance with their best judgment.
The prompt return of your proxy will be appreciated and helpful in
obtaining the necessary vote. Therefore, whether or not you expect to attend the
Annual Meeting, please sign the proxy and return it in the enclosed envelope.
By Order of the Board of Directors
Peggy S. Woodham
Secretary
Dated: March 26, 1999
-19-
<PAGE>
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K WILL BE SENT WITHOUT
CHARGE TO ANY STOCKHOLDER REQUESTING IT IN WRITING FROM: AMERICAN BUILDINGS
COMPANY, ATTENTION: R. CHARLES BLACKMON, 1150 STATE DOCKS ROAD, EUFAULA, ALABAMA
36027.
-20-
<PAGE>
AMERICAN BUILDINGS COMPANY
PROXY SOLICITED ON BEHALF OF BOARD OF DIRECTORS
The undersigned hereby appoints Robert T. Ammerman and William L. Selden,
and each of them, with full power of substitution, as proxies to vote on behalf
of the undersigned all shares which the undersigned may be entitled to vote at
the Annual Meeting of Stockholders of the Company to be held at the offices of
Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New York 10103 at 10:00
A.M. on Tuesday, April 27, 1999, and at any adjournments thereof, with all
powers the undersigned would possess if personally present, upon the matters set
forth in the Notice of Annual Meeting and Proxy Statement, as directed on the
reverse side hereof.
Any proxy heretofore given by the undersigned with respect to such shares
is hereby revoked. Receipt of the Notice of Annual Meeting and Proxy Statement
is hereby acknowledged.
(To be Completed, Signed and Dated on Reverse Side)
<PAGE>
|X| Please mark your
votes as in this
example.
FOR WITHHOLD
1. ELECTION |_| |_|
OF
DIRECTORS
Nominees: Robert T. Ammerman
Harold Levy
Douglas L. Newhouse
Ralph S. Saul
William L. Selden
Robert F. Shapiro
(Instruction: To withhold authority to vote for any
individual nominee, write that nominee's name below.)
- ------------------------------------------------------
NOTE: THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO
SPECIFICATION IS MADE, IT WILL BE VOTED FOR ALL
NOMINEES IN PROPOSAL 1 AND FOR PROPOSALS 2 AND 3.
THE PROXIES ARE AUTHORIZED TO VOTE IN THEIR OF
DISCRETION WITH RESPECT TO OTHER MATTERS WHICH MAY
DIRECTORS COME BEFORE THE MEETING.
SIGNATURE___________________________________ DATE__________
SIGNATURE___________________________________ DATE__________
(SIGNATURE IF HELD JOINTLY)
NOTE: Please mark, date and sign exactly as name appears hereon, including
designation as executor, trustee, etc. if applicable. A corporation must
sign in its name by the President or other authorized officer. All
co-owners must sign. PLEASE RETURN THE PROXY CARD PROMPTLY USING THE
ENCLOSED ENVELOPE.
