SCHEDULE 14A
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
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Avondale Industries, Inc.
(Name of Registrant as Specified In Its Charter
Board of Directors of Avondale Industries, 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(j)(2). *previously paid
[ ] $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:<FN1>
4) Proposed maximum aggregate value of transaction:
<FN1> Set forth the amount on 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 the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
[AVONDALE LETTERHEAD]
April 19, 1994
Dear Stockholder:
Proxy solicitation material from a group calling itself the
"Avondale Shareholder Committee" has recently been filed with the
Securities and Exchange Commission proposing advisory shareholder
votes asking the Company's Board of Directors to consider changes
to the Company's corporate governance structure.
You need to appreciate that this so-called "committee" is
controlled by union organizers who your Company's Board of
Directors and management believe are motivated not by legitimate
stockholder interests but rather by the desire to advance union-
related goals that are harmful to the interests of the Company's
stockholders and employees. Your Company's Board of Directors
and management strongly urge you NOT to sign any proxy card
provided by this committee. In addition, we ask you to sign,
date and return the enclosed GREEN proxy card with a vote AGAINST
each of the proposals and FOR the two nominees for director.
We have noted that included among the members of the committee
are the United Brotherhood of Carpenters and Joiners of America
("Union") and John Meese, president of the Metal Trades
Department, AFL-CIO. The Union, which is an affiliate of the
Metal Trades Department, and Mr. Meese became stockholders of
record of the Company on April 1, 1994, two business days prior
to the record date for the meeting, when they purchased a total
of 150 shares of the Company's common stock. We also have noted
that the committee's proxy card has named in addition to Mr.
Meese, Ed Durkin (director of special programs for the Union) and
Phil Miller, a local union organizer, each of whom is a full-time
union professional and neither of whom are stockholders, as the
proxy holders for the annual meeting. It is our belief that this
amounts to undeniable evidence that the committee is union
controlled.
In June 1993, an election was conducted to determine whether
certain of the Company's main shipyard's employees desired to be
represented by the Metal Trades Department of the AFL-CIO. The
National Labor Relations Board is in the process of determining
the final outcome of the election.
The Company has opposed the unionization of the workforce at the
main shipyard because the Board of Directors and management
believes unionization is not in the best interests of the
Company's employees or stockholders. The Company's Board of
Directors and management believe that the goals of the union,
through the committee, in conducting its proxy solicitation are
to attempt to discredit the Company's management and to attempt
to weaken the Company's resolve in opposing the unionization of
certain of its employees. The Company is just one of many
companies that have recently been the target of this union tactic
of fostering proxy contests, which the Company's Board of
Directors and management believe is an inappropriate way to
address labor matters.
The Company is currently the only major non-union shipyard in the
United States. The Company's Board of Directors and management
believe that the Company's competitive advantage is due in part
to its non-union status and that to give in to union pressure
would be detrimental to stockholders' interests.
The year 1993 marked a significant turning point for the Company
as its stock price more than tripled. In addition, during 1993
the Company successfully secured shipbuilding contracts that
increased its backlog from a low during the year of approximately
$495 million to over $2.2 billion (with options) at year end, an
increase of over 400%. The Company also successfully negotiated
with the U.S. Navy a $145 million settlement of the Company's
previously submitted Requests for Equitable Adjustment with
respect to those contracts that were a major reason for the
Company's losses in recent years, and reduced its indebtedness
over the past 18 months by approximately $82 million. These
actions substantially strengthened the Company's financial
condition and positioned the Company to take advantage of future
business opportunities.
The same management that the committee has charged with
"mismanagement" is responsible for the positive developments in
1993 that will benefit the stockholders and employees in the
years ahead. Actions taken by the Company's management will
enable the Company to continue to sustain employment at
relatively high levels, as the Company was able to do during the
difficult period in the late 1980s and early 1990s when many
other companies were dramatically downsizing their workforce or
going out of business entirely. The Company encourages you to
read the Company's 1993 Annual Report, which contains information
regarding the achievements of the Company's management and the
Company's prospects.
The Company's Board of Directors is fully informed regarding the
ongoing debate over the appropriate structure of the governance
of American corporations. The Board continually evaluates these
concerns in fulfilling its obligation to manage the Company in
the best interests of its stockholders.
The Company's employees and management have worked very hard to
return the Company to profitability and the prospects for a
profitable future are bright. The Company does not believe it is
in the stockholders' or employees' best interests to disrupt the
Company's turnaround at the very time when both the stockholders
and employees are on the verge of reaping the rewards of these
efforts.
Once again, we urge you to sign, date and return the enclosed
GREEN proxy card with a vote AGAINST each of the committee
proposals and FOR the two nominees for director.
Sincerely,
THE BOARD OF DIRECTORS OF
AVONDALE INDUSTRIES, INC.
By: __________________________
Albert L. Bossier, Jr.
Chairman, President &
Chief Executive Officer
<PAGE>
AVONDALE INDUSTRIES, INC.
PROXY SUPPLEMENT
TO PROXY STATEMENT DATED APRIL 6, 1994
April 19, 1994
Avondale Industries, Inc. (the "Company") is providing the
enclosed material to you in response to materials filed with the
Securities and Exchange Commission (the "SEC") by a group calling
itself the "Avondale Shareholder Committee", which the Company's
Board of Directors and management believe is controlled by union
interests. This committee has stated its intention to introduce
the six proposals reproduced below at the Company's annual
meeting of stockholders on May 6, 1994 (the "Meeting"). In
addition to voting FOR the two nominees for director, the Company
strongly urges that you vote AGAINST these committee proposals on
the enclosed GREEN proxy card for the reasons set out in the
enclosed letter.
You should have already received the Company's proxy
statement dated April 6, 1994 (the "Original Proxy Statement")
pursuant to which the Company's Board of Directors solicited your
vote in favor of the election of two director nominees at the
Meeting. These materials were mailed to you prior to the date
the committee filed its materials with the SEC and therefore they
do not refer to the committee's proposals. The purpose of these
supplemental proxy materials is to solicit your vote against the
committee proposals and for the two nominees for directors.
Enclosed is a GREEN proxy card on which you should indicate
your vote on the election of directors and the committee
proposals. THE COMPANY'S BOARD OF DIRECTORS AND MANAGEMENT
STRONGLY URGE YOU TO SIGN, DATE AND RETURN THE GREEN PROXY CARD
WITH A VOTE FOR THE TWO NOMINEES FOR DIRECTOR AND A VOTE AGAINST
EACH OF THE COMMITTEE PROPOSALS.
If you have already sent in the proxy card accompanying the
Original Proxy Statement, we ask that you send in the enclosed
GREEN proxy card also, which will supersede the proxy card you
have already sent in. The latest dated proxy given by you will
be the one counted at the Meeting.
If you have already sent in the proxy card accompanying the
Original Proxy Statement, you granted discretionary authority to
the persons named as proxies therein to vote in their best
judgment on matters that may properly come before the Meeting and
that the Company's Board did not know at the time of mailing were
to be presented at the Meeting. IF YOU DO NOT SUBSEQUENTLY SEND
IN THE GREEN PROXY CARD OR ANY OTHER PROXY CARD, THE PROXY
HOLDERS WILL DEEM THAT YOU DO NOT WISH TO REVOKE THE
DISCRETIONARY AUTHORITY YOU GRANTED THEREIN AND WILL VOTE YOUR
SHARES AS YOU DIRECTED IN THE ELECTION OF DIRECTORS AND AGAINST
THE COMMITTEE PROPOSALS.
If a quorum is present, directors will be elected by
plurality vote and, in order to be adopted, the committee
proposals must receive the affirmative vote of a majority of the
shares of common stock present or represented at the Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
Thomas M. Kitchen
Secretary
Avondale, Louisiana
April 19, 1994
Set forth below are the proposals that the committee has
stated it intends to introduce at the Meeting. THE COMPANY'S
BOARD OF DIRECTORS AND MANAGEMENT STRONGLY URGE YOU TO SIGN, DATE
AND RETURN THE GREEN PROXY CARD WITH A VOTE FOR THE TWO NOMINEES
FOR DIRECTOR AND A VOTE AGAINST EACH OF THE COMMITTEE PROPOSALS.
COMMITTEE PROPOSALS
Committee Resolution No. 1: Independent Board of Directors
BE IT RESOLVED, that the shareholders of Avondale Industries,
Inc. ("Company") hereby urge that the Company's Board of
Directors take the steps necessary to amend the Company's by-
laws, effective after the 1994 annual meeting of shareholders, to
provide that the Board of Directors shall consist of a majority
of Independent Directors. The by-law change shall be done in a
manner which does not affect the unexpired terms of previously
elected directors. For these purposes, the definition of
Independent Director shall mean a director who:
. has not been employed by the Company or an affiliate in
an executive capacity within the last five years;
. was not, and is not a member of a corporation or firm
that is one of the Company's paid advisers or
consultants;
. is not employed by a significant customer, supplier or
provider of professional services;
. has no personal services contract with the Company;
. is not employed by a foundation or university that
receives significant grants or endowments from the
Company;
. is not a relative of the management of the Company;
. is not a director of a company on which Avondale
Industries' Chairman or Chief Executive Officer is also
a board member; and
. is not a shareholder who has signed shareholder
agreements legally binding him or her to vote with
management.
Committee Resolution No. 2: Nominating Committee
BE IT RESOLVED, that the shareholders of the Company urge the
Board of Directors to establish a Nominating Committee of the
Board in conformity with Company by-laws. The Nominating
Committee shall identify and recommend for nomination candidates
to stand for election to the Board of Directors. The Committee
shall be composed entirely of members who:
. have not been employed by the Company or an affiliate
in an executive capacity within the last five years;
. are not a member of another company or firm that is one
of the Company's paid advisers, consultants or a
significant customer or supplier of the Company;
. have no personal services contract with the Company;
. are not employed by a foundation or university that
receives significant grants or endowments from the
Company;
. are not a relative of the management of the Company;
. are not a board member or employee of another company
whose board includes directors or employee of the
Company; and
. are not a shareholder who has signed shareholder
agreements legally binding him to vote with management.
The Nominating Committee's responsibilities shall include
establishing procedures for the nomination process and developing
for Board approval the criteria for nomination. These procedures
and criteria should be described in that portion of the Company's
proxy statement covering the election of directors.
Committee Resolution No. 3: Confidential Proxy Voting
BE IT RESOLVED, that the shareholders of the Company urge that
our Board of Directors take the necessary steps to adopt and
implement a policy of confidential voting at all meetings of
Company shareholders. The policy should include the following
provisions:
1. that the voting of all proxies, consents and
authorizations be secret, and that no such document
shall be available for examination, nor shall the vote
or identity of any shareholder be disclosed, except to
the extent necessary to meet the legal requirements, if
any, of the Company's state of incorporation; and
2. that the receipt, certification and tabulation of such
votes shall be performed by independent election
inspectors.
Committee Resolution No. 4: Board Declassification
BE IT RESOLVED, that the shareholders of the Company urge that
the Board of Directors take the necessary steps, in compliance
with the Company's by-laws, to declassify the Board of Directors
for the purposes of director elections. The Board
declassification shall be done in a manner that does not affect
the unexpired terms of directors previously elected.
Committee Resolution No. 5: Cumulative Voting
BE IT RESOLVED, that the shareholders of the Company urge our
Board of Directors to take the necessary steps, in accordance
with Louisiana state law and Company by-laws, to adopt and
implement a policy of cumulative voting for all elections of
directors.
Committee Resolution No. 6: Reconstitution of Compensation
Committee
BE IT RESOLVED, that the shareholders of the Company urge the
Board of Directors to take the steps necessary to amend the by-
laws of the Company to provide a Board Compensation Committee
composed entirely of directors who:
. have not been employed by the Company or an affiliate
in an executive capacity within the last five years;
. are not a member of another company or firm that is one
of the Company's paid advisers, consultants or a
significant customer or supplier of the Company; and
. have no personal services contract with the Company.
Further, the Compensation Committee members should be selected by
the entire Board.
<PAGE>
AVONDALE INDUSTRIES, INC.
POST OFFICE BOX 50280
AVONDALE, LOUISIANA 70150
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
AVONDALE INDUSTRIES, INC.
The undersigned hereby appoints Bruce L. Hicks and Joseph
W. Mangin, Jr., or either of them, as proxies, each with full
power of substitution, and hereby authorizes each of them to
represent and to vote, as designated below, all shares of common
stock of Avondale Industries, Inc. held of record by the
undersigned on April 5, 1994 at the annual meeting of
stockholders to be held on May 6, 1994, or any adjournment
thereof.
COMPANY PROPOSALS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR BOTH OF THE NOMINEES
LISTED BELOW:
Election of Directors
[ ] FOR both nominees [ ] WITHHOLD AUTHORITY
listed below (except to vote for both
as marked to nominees listed below
the contrary below)
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR EITHER NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME LISTED
BELOW.
Albert L. Bossier, Jr. Hugh A. Thompson
COMMITTEE PROPOSALS
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE AGAINST COMMITTEE
PROPOSALS 1 THROUGH 6, BY CHECKING THE BOX MARKED "AGAINST."
1. Independent Board Resolution
[ ]AGAINST [ ]FOR [ ]ABSTAIN
2. Nominating Committee Resolution
[ ]AGAINST [ ]FOR [ ]ABSTAIN
3. Confidential Proxy Voting Resolution
[ ]AGAINST [ ]FOR [ ]ABSTAIN
4. Board of Directors Declassification Resolution
[ ]AGAINST [ ]FOR [ ]ABSTAIN
5. Cumulative Voting Resolution
[ ]AGAINST [ ]FOR [ ]ABSTAIN
6. Reconstitution of Compensation Committee Resolution
[ ]AGAINST [ ]FOR [ ]ABSTAIN
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION
IS GIVEN, THIS PROXY WILL BE VOTED FOR BOTH OF THE DIRECTOR
NOMINEES NAMED ABOVE AND AGAINST PROPOSALS 1 THROUGH 6. THE
PROXY HOLDERS NAMED ABOVE WILL VOTE IN THEIR DISCRETION ON ANY
OTHER MATTER THAT MAY PROPERLY COME BEFORE THE MEETING.
THE UNDERSIGNED HEREBY REVOKES ANY PRIOR PROXY HERETOFORE GIVEN
TO ANY PERSON OR PERSONS.
Date: ______________, 1994
___________________________
Signature of Shareholder
___________________________
Additional Signature, if
held jointly
PLEASE SIGN EXACTLY AS NAME APPEARS
HEREON. WHEN SIGNING AS ATTORNEY,
EXECUTOR, ADMINISTRATOR, TRUSTEE OR
GUARDIAN, PLEASE GIVE FULL TITLE AS
SUCH. IF A CORPORATION, PLEASE SIGN
FULL CORPORATE NAME BY PRESIDENT OR
OTHER AUTHORIZED OFFICER. IF A
PARTNERSHIP, PLEASE SIGN IN
PARTNERSHIP NAME BY AUTHORIZED
PERSON.
PLEASE MARK, SIGN, DATE AND RETURN
THIS PROXY PROMPTLY USING THE
ENCLOSED ENVELOPE.
<PAGE>
[AVONDALE LETTERHEAD]
April 19, 1994
Dear ESOP Participant:
Proxy solicitation material from a group calling itself the
"Avondale Shareholder Committee" has recently been filed with the
Securities and Exchange Commission proposing advisory shareholder
votes asking the Company's Board of Directors to consider changes
to the Company's corporate governance structure.
You need to appreciate that this so-called "committee" is
controlled by union organizers who your Company's Board of
Directors and management believe are motivated not by legitimate
stockholder interests but rather by the desire to advance union-
related goals that are harmful to the interests of the Company's
stockholders and employees. Your Company's Board of Directors
and management strongly urge you NOT to vote in favor of any
proposal advanced by this committee. We ask you to sign, date
and return any voting instruction form you may receive with a
vote AGAINST each of the committee proposals and FOR the two
nominees for director.
We have noted that included among the members of the committee
are the United Brotherhood of Carpenters and Joiners of America
("Union") and John Meese, president of the Metal Trades
Department, AFL-CIO. The Union, which is an affiliate of the
Metal Trades Department, and Mr. Meese became stockholders of
record of the Company on April 1, 1994, two business days prior
to the record date for the meeting, when they purchased a total
of 150 shares of the Company's common stock. We also have noted
that the committee's proxy card has named in addition to Mr.
Meese, Ed Durkin (director of special programs for the Union) and
Phil Miller, a local union organizer, each of whom is a full-time
union professional and neither of whom are stockholders, as the
proxy holders for the annual meeting. It is our belief that this
amounts to undeniable evidence that the committee is union
controlled.
In June 1993, an election was conducted to determine whether
certain of the Company's main shipyard's employees desired to be
represented by the Metal Trades Department of the AFL-CIO. The
National Labor Relations Board is in the process of determining
the final outcome of the election.
The Company has opposed the unionization of the workforce at the
main shipyard because the Board of Directors and management
believes unionization is not in the best interests of the
Company's employees or stockholders. The Company's Board of
Directors and management believe that the goals of the union,
through the committee, in conducting its proxy solicitation are
to attempt to discredit the Company's management and to attempt
to weaken the Company's resolve in opposing the unionization of
certain of its employees. The Company is just one of many
companies that have recently been the target of this union tactic
of fostering proxy contests, which the Company's Board of
Directors and management believe is an inappropriate way to
address labor matters.
The Company is currently the only major non-union shipyard in the
United States. The Company's Board of Directors and management
believe that the Company's competitive advantage is due in part
to its non-union status and that to give in to union pressure
would be detrimental to stockholders' interests.
The year 1993 marked a significant turning point for the Company
as its stock price more than tripled. In addition, during 1993
the Company successfully secured shipbuilding contracts that
increased its backlog from a low during the year of approximately
$495 million to over $2.2 billion (with options) at year end, an
increase of over 400%. The Company also successfully negotiated
with the U.S. Navy a $145 million settlement of the Company's
previously submitted Requests for Equitable Adjustment with
respect to those contracts that were a major reason for the
Company's losses in recent years, and reduced its indebtedness
over the past 18 months by approximately $82 million. These
actions substantially strengthened the Company's financial
condition and positioned the Company to take advantage of future
business opportunities.
The same management that the committee has charged with
"mismanagement" is responsible for the positive developments in
1993 that will benefit the stockholders and employees in the
years ahead. Actions taken by the Company's management will
enable the Company to continue to sustain employment at
relatively high levels, as the Company was able to do during the
difficult period in the late 1980s and early 1990s when many
other companies were dramatically downsizing their workforce or
going out of business entirely. The Company encourages you to
read the Company's 1993 Annual Report, which contains information
regarding the achievements of the Company's management and the
Company's prospects.
The Company's Board of Directors is fully informed regarding the
ongoing debate over the appropriate structure of the governance
of American corporations. The Board continually evaluates these
concerns in fulfilling its obligation to manage the Company in
the best interests of its stockholders.
The Company's employees and management have worked very hard to
return the Company to profitability and the prospects for a
profitable future are bright. The Company does not believe it is
in the stockholders' or employees' best interests to disrupt the
Company's turnaround at the very time when both the stockholders
and employees are on the verge of reaping the rewards of these
efforts.
Once again, we urge you to sign, date and return any voting
instruction form you may receive with a vote AGAINST each of the
committee proposals and FOR the two nominees for director.
Sincerely,
THE BOARD OF DIRECTORS OF
AVONDALE INDUSTRIES, INC.
By:
Albert L. Bossier, Jr.
Chairman, President &
Chief Executive Officer
