SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. - )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use
of Commission
[ ] Definitive Proxy Statement Only (as permitted by
Rule 14a-6(e)(2))
[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, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $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 (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:
______________________________________________
[X] 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
_________________________
4) Date Filed:
_________________________
<PAGE>
AVONDALE INDUSTRIES, INC. JUNE 1, 1995
PROXY SUPPLEMENT
TO PROXY STATEMENT DATED APRIL 3, 1995
Avondale Industries, Inc. (the "Company") is providing the
enclosed supplemental proxy materials to you in connection with
the reconvening of the Company's 1995 annual meeting (the "Annual
Meeting") at 9:00 a.m. on Tuesday, June 20, 1995 in the main
conference room on the second floor of the Company's
Administration Building, 5100 River Road, Avondale, Louisiana.
The Company has previously distributed to you its proxy statement
dated April 3, 1995 (the "Proxy Statement") for the Annual
Meeting which was originally convened on April 28, 1995 (the
"April Meeting"). Pursuant to the Proxy Statement, the Company's
Board of Directors solicited your vote in favor of the election
of three director nominees and against five shareholder proposals
submitted by a group calling itself the "Avondale Shareholders
Committee".
On April 21, 1995, the Federal District Court of the Eastern
District of Louisiana issued a preliminary injunction prohibiting
the voting of proxies with respect to the shareholder proposal
identified as Item 6 on the Company's Proxy Statement and Proxy.
Pursuant to that order, the Company adjourned the Annual Meeting
until June 13, 1995 at 9:00 a.m. On May 25, 1995 the Federal
District Court amended its previous order, and, based on that
amendment, the Company has determined that on June 13, 1995, it
will again adjourn and reconvene the Annual Meeting until June
20, 1995 at 9:00 a.m. for the sole purpose of considering and
voting on the shareholder proposal. At the April Meeting, the
Company's shareholders voted in favor of all three director
nominees nominated by the Company's Board of Directors and voted
overwhelmingly against the other four shareholder proposals that
were permitted under the order to be considered and voted upon at
the April Meeting.
The purpose of these supplemental proxy materials is to
solicit your vote against the shareholder proposal. For the
reasons set forth in the Proxy Statement and in the enclosed
supplemental proxy materials, the shareholder proposal is opposed
by the Board of Directors and the Board of Directors unanimously
urges you to vote AGAINST the proposal.
Enclosed is a proxy on which you should indicate your vote
on the shareholder proposal. In order to be adopted, the
shareholder proposal must receive the affirmative vote of 80% of
the total voting power of the Company. THE COMPANY'S BOARD OF
DIRECTORS AND MANAGEMENT STRONGLY URGE YOU TO SIGN, DATE AND
RETURN THE PROXY WITH A VOTE AGAINST THE SHAREHOLDER PROPOSAL.
BY ORDER OF THE BOARD OF DIRECTORS
Thomas M. Kitchen
Secretary
Avondale, Louisiana
June 1, 1995
<PAGE>
Set forth below is the proposal submitted by the
Shareholders Committee.
Shareholder Proposal Regarding Bylaw
Adoption, Amendment or Repeal Process
RESOLVED: To amend Article VI of Avondale Industries,
Inc.'s ("Corporation") Articles of Incorporation by
replacing existing language with the following:
A. Shareholder Authority
All shareholders have the authority to propose adoption of
new by-laws or amendment or repeal of existing by-laws of
the Corporation.
B. Adoption, Amendment or Repeal of By-laws
By-laws of the Corporation may be adopted, amended or
repealed by:
(i) The affirmative vote of the holders of at least two-
thirds of the Total Voting Power at any regular or
special meeting of shareholders, the notice of which
expressly states that the proposed new by-law,
amendment or repeal is to be considered at the meting;
or
(ii) The affirmative vote of the entire board of directors
and the subsequent affirmative vote of the holders of
at least two-thirds of the Total Voting Power at the
next regular or special meeting of shareholders, the
notice of which expressly states that the proposed new
by-law, amendment or repeal is to be considered at the
meeting. By-law changes resulting from unanimous board
action shall be in effect until ratification by a two-
thirds shareholders vote. Any Board of Directors
initiated by-law change failing to receive two-thirds
shareholder approval at a scheduled vote shall be
automatically repealed.
C. Re-Amendment or Re-Adoption by the Board of Directors
The Board of Directors is prohibited from amending or
repealing by-law changes that receive the affirmative vote
of two-thirds of the Total Voting Power for a period of one
year following such vote.
AND; FURTHER RESOLVED,
To amend Section 13 of Avondale Industries, Inc.'s
("Corporation") bylaws by replacing existing language with
the following:
13.1 Shareholder Authority
All shareholders have the authority to propose adoption of
new by-laws or amendment or repeal of existing by-laws of
the Corporation.
13.2 Adoption, Amendment or Repeal of By-laws
By-laws of the Corporation may be adopted, amended or
repealed by:
(i) The affirmative vote of the holders of at least two-
thirds of the Total Voting Power at any regular or
special meeting of shareholders, the notice of which
expressly states that the proposed new by-law,
amendment or repeal is to be considered at the meeting;
or
(ii) The affirmative vote of the entire board of directors
and the subsequent affirmative vote of the holders of
at least two-thirds of the Total Voting Power at the
next regular or special meeting of shareholders, the
notice of which expressly states that the proposed new
by-law, amendment or repeal is to be considered at the
meeting. By-law changes resulting from unanimous board
motion shall be in effect until ratification by a two-
thirds shareholders vote. Any Board of Directors
initiated by-law change failing to receive two-thirds
shareholder approval at a scheduled vote shall be
automatically repeated.
13.3 Re-Amendment or Re-Adoption by the Board of Directors
The Board of Directors is prohibited from amending or
repealing by-law changes that receive the affirmative vote
of two-thirds of the Total Voting Power for a period of one
year following such vote.
Board of Directors' Statement in Opposition to Bylaw Adoption,
Amendment or Repeal Process Proposal
As the Board has stated in the Proxy Statement, we believe
that the Avondale Shareholders Committee is controlled by the
United Brotherhood of Carpenters and Joiners of America (the
"Union") and its sole purpose in conducting this campaign is to
discredit the Company's management and weaken the Company's
resolve in opposing the unionization of certain of its employees.
However, in addition to objecting to the proposal because it is
Union-sponsored, the Company's Board of Directors and management
also believe that the proposal should be rejected for the
following reasons.
The Board does not believe the implementation of this
proposal is justified. Currently the Company's Articles and
bylaws provisions regarding bylaw amendments permit the bylaws to
be adopted, amended, or repealed by a majority of the Board,
subject to the power of the holders of 80% of the voting power of
the Company to amend or repeal any bylaws so made. Other than
the specific percentage vote of the shareholders required, this
provision follows the Louisiana Business Corporation Law. The
Board believes that vesting the Board of Directors with this
authority, subject to the right of a substantial majority of
shareholders to undo any bylaw provisions adopted by the Board,
strikes the appropriate balance between shareholders and the
Board regarding bylaw amendments.
In so concluding, we note that the Louisiana Business
Corporation Law provides that the business and affairs of a
corporation is to be managed by a board of directors, and the
Board believes it can best fulfill its statutory duties and
participate in the management and control of the Company under
the current bylaw amendment process. The Board believes that in
order to properly discharge its responsibilities, it needs the
ability to effect amendments to the bylaws, the set of rules
governing the internal affairs of the Company, without the
limitations set forth in the proposal, which would prevent the
Board from adopting bylaws with any lasting effect without
ratification by a vote of two-thirds of the total voting power of
the Company. Such a provision is extremely unusual and
cumbersome for a public company and would unduly burden the Board
in exercising its statutory and fiduciary duties with respect to
the Company. In conjunction with the management powers given to
the Board by Louisiana law, each member of the Board owes
fiduciary duties to the Company and its shareholders. Under
Louisiana law, members of the Board may breach their fiduciary
responsibility even if they followed the expressed wishes of the
majority of shareholders. Because of this risk of liability and
the statutorily imposed duty of the Board to manage the affairs
of the Company, the Board believes it requires the degree of
independence of decisions and discretion regarding changes to the
Company's bylaws currently existing. Additionally, we note that
this provision of the Company's Articles of Incorporation was
approved by the Company's shareholders in 1990 when they voted
upon the reincorporation of the Company in Louisiana.
The Company's Board of Directors and Management strongly
urge you to sign, date and return the proxy with a vote AGAINST
the shareholder proposal.
<PAGE>
PROPONENTS' SUMMARY OF ITEM 6
The U.S. District Court for the Eastern District of
Louisiana has ordered that this summary, prepared by the Avondale
Shareholder Committee, be attached to the Company's proxy
materials.
This shareholder proposal presents reforms to the by-law
amendment process which will give shareholders a greater power to
influence the basic rules by which the Company is governed.
Item 6 would grant shareholders the power to enact new by-
laws or to amend or repeal existing by-laws by a two-thirds vote
of the total voting power. Once the shareholders take such an
action, the Board of Directors would be prohibited from amending
or repealing such shareholder-enacted by-law changes for one
year following the shareholder vote. Currently, the by-laws
require an 80% vote of the total voting power for shareholders to
amend or repeal existing by-laws, and a majority of the Board may
at any time reverse such changes by re-amending or re-adopting
any provision changed by the shareholders.
Currently, a bare majority of the Board may change the by-
laws at any time, without any shareholder ratification. Item 6
would require Board-initiated by-law changes to be unanimous, and
such changes would have to be ratified by a two-thirds vote of
the total voting power of the shareholders at the next
shareholder meeting.
<PAGE>
(Detach Proxy Form Here)
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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 Kenneth G.
Myers, 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 March 21, 1995
at the reconvened annual meeting of shareholders on June 20, 1995,
or any adjournment thereof.
SHAREHOLDER PROPOSAL
The Board of Directors recommends that you vote AGAINST the
shareholder proposal by checking the box marked "AGAINST."
By-Law Adoption, Amendment or Repeal Proposal
[ ] AGAINST [ ] FOR [ ] ABSTAIN
(Detach Proxy Form Here)
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This proxy, when properly executed, will be voted in the manner
directed herein by the undersigned shareholder. If no
directions are given, this proxy will be voted AGAINST the
shareholder proposal. 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.
Dated: ____________________, 1995
______________________________________
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.
