<PAGE> 1
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:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
GENEVA STEEL 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/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 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:
---------------------------------------------------------------------
/ / 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.:
Preliminary Proxy Material
---------------------------------------------------------------------
(3) Filing Party:
Registrant
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(4) Date Filed:
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<PAGE> 2
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MARCH 26, 1996
[LOGO] GENEVA STEEL
You are cordially invited to attend the Annual Meeting of Shareholders
of Geneva Steel Company (the "Company"), which will be held on Tuesday, March
26, 1996, at 10:00 a.m., at the Screening Room, Sundance Resort, Sundance, Utah
84604 (the "Annual Meeting"), for the following purposes:
(i) To elect seven directors of the Company, each to serve until
the next annual meeting of shareholders and until their
respective successors have been duly elected and qualified;
(ii) To consider and vote upon a proposal to ratify the appointment
of Arthur Andersen LLP as independent auditor of the Company
for the fiscal year ending September 30, 1996; and
(iii) To transact such other business as may properly come before
the Annual Meeting or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on January 24,
1996 as the record date for the determination of shareholders entitled to
receive notice of and to vote at the Annual Meeting and at any adjournment or
postponement thereof.
By Order of the Board of Directors
/s/ KEN C. JOHNSEN
-----------------------------------
KEN C. JOHNSEN
Secretary
January 29, 1996
IMPORTANT
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, TO
ASSURE THAT YOUR SHARES WILL BE REPRESENTED, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY WITHOUT DELAY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES
NO ADDITIONAL POSTAGE IF MAILED IN THE UNITED STATES. YOUR PROXY WILL NOT BE
USED IF YOU ARE PRESENT AT THE ANNUAL MEETING AND DESIRE TO VOTE YOUR SHARES
PERSONALLY.
<PAGE> 3
GENEVA STEEL COMPANY
10 SOUTH GENEVA ROAD
VINEYARD, UTAH 84058
--------------------
PROXY STATEMENT
--------------------
ANNUAL MEETING OF SHAREHOLDERS
MARCH 26, 1996
SOLICITATION OF PROXIES
This Proxy Statement is being furnished to the shareholders of Geneva
Steel Company, a Utah corporation doing business as "Geneva Steel" (the
"Company" or "Geneva"), in connection with the solicitation by the Board of
Directors of the Company of proxies from holders of outstanding shares of the
Company's Class A Common Stock, no par value (the "Class A Common Stock" or
"Class A Shares"), and the Company's Class B Common Stock, no par value (the
"Class B Common Stock" or "Class B Shares"), for use at the Annual Meeting of
Shareholders of the Company to be held Tuesday, March 26, 1996, and at any
adjournment or postponement thereof (the "Annual Meeting"). The Class A Common
Stock and the Class B Common Stock are sometimes referred to collectively as the
"Common Stock." This Proxy Statement, the Notice of Annual Meeting of
Shareholders and the accompanying form of proxy are first being mailed to
shareholders of the Company on or about January 29, 1996.
The Company will bear all costs and expenses relating to the
solicitation of proxies, including the costs of preparing, printing and mailing
to shareholders this Proxy Statement and accompanying material. In addition to
the solicitation of proxies by mail, the directors, officers and employees of
the Company, without receiving additional compensation therefor, may solicit
proxies personally or by telephone. Arrangements will be made with brokerage
firms and other custodians, nominees and fiduciaries for the forwarding of
solicitation materials to the beneficial owners of the shares of Class A Common
Stock held by such persons, and the Company will reimburse such brokerage firms,
custodians, nominees and fiduciaries for reasonable out-of-pocket expenses
incurred by them in connection therewith.
VOTING
RECORD DATE
The Board of Directors has fixed the close of business on January 24,
1996 as the record date for determination of shareholders entitled to notice of
and to vote at the Annual Meeting (the "Record Date"). As of the Record Date,
there were issued and outstanding 13,359,847 shares of Class A Common Stock and
19,151,348 shares of Class B Common Stock. The holders of record of the shares
of Common Stock on the Record Date entitled to be voted at the Annual Meeting
are entitled to cast one vote per share on each matter submitted to a vote at
the Annual Meeting. Accordingly, a total of 32,511,195 votes are entitled to be
cast on each matter submitted to a vote at the Annual Meeting.
<PAGE> 4
PROXIES
Shares of the Common Stock which are entitled to be voted at the Annual
Meeting and which are represented by properly executed proxies will be voted in
accordance with the instructions indicated on such proxies. If no instructions
are indicated, such shares will be voted (i) FOR the election of each of the
seven (7) director nominees; (ii) FOR the ratification of the appointment by the
Board of Directors of Arthur Andersen LLP to be the independent auditor of the
Company for the fiscal year ending September 30, 1996; and (iii) in the
discretion of the proxy holders as to any other matters which may properly come
before the Annual Meeting.
A shareholder who has executed and returned a proxy may revoke it at
any time prior to its exercise at the Annual Meeting by executing and returning
a proxy bearing a later date, by filing with the Secretary of the Company, at
the address set forth above, a written notice of revocation bearing a later date
than the proxy being revoked, or by voting the Common Stock covered thereby in
person at the Annual Meeting.
REQUIRED VOTE
A majority of the outstanding shares of Common Stock entitled to vote,
represented in person or by properly executed proxy, is required for a quorum.
An abstention will be counted as "represented" for the purpose of determining
the presence or absence of a quorum. A broker non-vote, which is an indication
by a broker that it does not have discretionary authority to vote on a
particular matter, will not be treated as "represented" for quorum purposes.
Under Utah corporate law, once a quorum is established, shareholder approval
with respect to a particular proposal is generally obtained when the votes cast
in favor of the proposal exceed the votes cast against such proposal.
Accordingly, abstentions and broker non-votes will not have the effect of being
considered as votes cast against any matter considered at the Annual Meeting.
With respect to the election of directors and the proposed ratification
of the independent auditor, holders of the Class A Common Stock and the Class B
Common Stock will vote together as one class. In the election of directors, the
seven (7) nominees receiving the highest number of votes will be elected. For
approval of the proposed ratification of the independent auditor, the votes cast
in favor of the proposal must exceed the votes cast against the proposal.
ELECTION OF DIRECTORS
At the Annual Meeting, seven (7) directors of the Company (constituting
the entire Board of Directors) are to be elected to serve until the next annual
meeting of shareholders and until their successors shall be duly elected and
qualified. Each of the nominees for director identified below, with the
exception of Dr. Richard B. Wirthlin, is currently a director of the Company. If
any of the nominees should be unavailable to serve, which is not now
anticipated, the proxies solicited hereby will be voted for such other persons
as shall be designated by the present Board of Directors. The seven (7) nominees
receiving the highest number of votes at the Annual Meeting will be elected.
NOMINEES FOR ELECTION AS DIRECTORS
Certain information with respect to each nominee is set forth below.
JOSEPH A. CANNON, 46, has been a director of the Company since its
inception in February 1987, and has served as Chairman of the Board of Directors
from March 1987 to the present. Mr. Cannon served as President of the Company
from July 1987 to May 1991 and as Chief Executive Officer from July 1987 to July
1991. Mr. Cannon returned to the Company as Chief Executive Officer in October
1992 and has continued to serve in such capacity. From February 1985 to
September 1987, Mr. Cannon was engaged in the private practice of law with
Pillsbury, Madison & Sutro in its Washington, D.C. office, specializing in
environmental law. From May 1981 to February 1985, he was employed in various
capacities by and became Assistant Administrator of the
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<PAGE> 5
Environmental Protection Agency. As Assistant Administrator, Mr. Cannon was
responsible for the development, implementation and enforcement of federal air
quality and radiation regulations throughout the United States.
ROBERT J. GROW, 46, has been Chief Operating Officer of the Company
since December 1989 and was elected as President in May 1991. Mr. Grow was
recently elected 1996 Chairman of the American Iron & Steel Institute ("AISI").
AISI is the premier industry association for steel companies in the United
States, Canada and Mexico. From August 1988 to December 1989, he was employed by
the Company in various capacities, including Vice President, Executive Vice
President and General Counsel. He has served as a director of the Company from
its inception. From 1976 to September 1987, Mr. Grow was engaged in the private
practice of law with the Salt Lake City, Utah law firm of Kimball, Parr,
Waddoups, Brown & Gee, specializing in real property and general corporate law.
Mr. Grow also holds a B.S. degree in Electrical Engineering from the University
of Utah.
RICHARD D. CLAYTON, 39, has been a director of the Company since
February 1993 and has served as Executive Vice President and Vice President of
Environment since November 1991. He was Vice President of Environment and
Special Projects of the Company from December 1989 through October 1991 and Vice
President of Energy and Special Projects from July 1989 to December 1989. From
1981 to July 1989, Mr. Clayton was engaged in the private practice of law with
Kimball, Parr, Waddoups, Brown & Gee, specializing in corporate counseling, real
property and tax law.
A. BLAINE HUNTSMAN, 59, has been a director of the Company since
December 1988. Mr. Huntsman was formerly Chairman of the Board and Chief
Executive Officer of Olympus Capital Corporation, a savings and loan holding
company headquartered in Salt Lake City, Utah, and served in such capacities
from December 1988 and June 1988, respectively, until May 1995. Mr. Huntsman is
also currently a director of Zion's Cooperative Mercantile Institution, a
retailing company located in Salt Lake City, Utah, a position he has held since
1977, and is a director of Kahler Realty Corporation, a hotel owner, developer
and manager based in Rochester, Minnesota, a position he has held since February
1994. Mr. Huntsman is a retired Professor of Finance from the University of Utah
David Eccles School of Business and served as Dean of the University of Utah
Graduate School and College of Business from 1975 to 1980. He has served as a
director of numerous private and public companies, including Huntsman Container
Corporation, Dean Witter Reynolds and Arcata Corporation.
ARCH L. MADSEN, 82, has been a director of the Company since December
1988. Mr. Madsen has been President Emeritus of Bonneville International
Corporation, a national communications company headquartered in Salt Lake City,
Utah, since July 1985, and a director since 1965, and served as the founding
President of such company from 1963 to July 1985. He remains active in a number
of national and international broadcasting organizations, and is also active in
various civic, educational and charitable institutions.
R. J. SHOPF, 61, has been a director of the Company since September
1989 and served as an independent advisor to the Company from March 1988 to
September 1989. Mr. Shopf currently serves as the Chairman of the Board of
Ruth's Chris Steakhouse of Indianapolis. He is also the President of Southwest
Business Associates, a consulting company (a position which he previously held
from 1984 to February 1988, and from January 1989 to October 1992), and has
served in this capacity since August 1994. Mr. Shopf served as President and
Chief Executive Officer of Pioneer Chlor Alkali Investments, Inc. ("Pioneer"),
from August 1993 until August 1994. Mr. Shopf also served as President of
Imperial West Chemical Company, an affiliate of Pioneer, from January 1992 until
August 1994, and as President of All Pure Chemical Company, also an affiliate of
Pioneer, from October 1992 until August 1994. From March 1988 to January 1989,
Mr. Shopf was employed by First Texas Merchant Banking Group, a division of
Gibraltar Savings Association, as Senior Vice President in charge of portfolio
management.
DR. RICHARD B. WIRTHLIN, 64, is Chairman of the Board and Chief
Executive Officer of Wirthlin Worldwide, a strategic opinion research firm
founded by Dr. Wirthlin in 1969 which is headquartered in McLean, Virginia, and
maintains offices in London and Hong Kong. Dr. Wirthlin's professional expertise
includes marketing, political and public affairs research and strategy. He was
chief strategist for former President Ronald Reagan's 1980 and 1984 campaigns.
Dr. Wirthlin holds a B.S. degree in economics and an M.S. degree in
3
<PAGE> 6
economics and statistics from the University of Utah. He also holds a Ph.d. in
economics from the University of California at Berkeley.
COMMITTEES AND MEETINGS
The Board of Directors has a standing Audit Committee and a
Compensation Committee. The members of the Audit Committee for 1995 were Messrs.
Shopf (Chairman), Madsen and Huntsman and the members of the Compensation
Committee for 1995 were Messrs. Huntsman (Chairman), Jacobson, Madsen and Shopf.
The Audit Committee met three (3) times during the fiscal year ended
September 30, 1995. Its functions are: (i) to review and recommend the selection
of the Company's independent auditor; (ii) to review the Company's internal
controls and all services performed by the Company's independent auditor; and
(iii) to review and report to the Board of Directors with respect to the scope
of audit procedures, accounting practices and internal accounting and financial
controls of the Company.
The Compensation Committee met two (2) times during the 1995 fiscal
year. Its functions are: (i) to determine and adopt compensation arrangements
for executive officers of the Company, subject to approval by the Board of
Directors; (ii) to review and administer any stock option, stock award and
employee benefit plan or arrangement established for the benefit of the
executive officers of the Company; and (iii) to review and recommend director
and officer nominees for election by the Company's shareholders or the Board of
Directors, as the case may be. The Compensation Committee does not have a formal
procedure for considering nominees to the Board of Directors recommended by the
shareholders.
During the fiscal year ended September 30, 1995, there were six (6)
meetings held by the Board of Directors of the Company. No director attended
fewer than 75 percent of the total number of meetings of the Board and of the
committees on which he served.
DIRECTOR COMPENSATION
Directors who are not employees of the Company are paid a director's
fee of $22,000 per year for serving on the Board of Directors, $3,000 per year
for serving as chairman of any committee, $1,500 for each Board meeting attended
and $1,000 for each committee meeting attended. All directors are also
reimbursed by the Company for their out-of-pocket travel and related expenses
incurred in attending all Board and committee meetings.
In addition, each non-employee director who serves for not less than
five years receives a deferred compensation payment in each of the five years
after termination of service in the amount of the retainer paid to such director
for services as a director during the year preceding termination of such
services (exclusive of any payments for service as a member of any committee of
the Board or otherwise). If a non-employee director's service is terminated
prior to five years of service by reason of death or disability, deferred
compensation is paid for a period equal to the period for which the director
served.
EXECUTIVE OFFICERS
In addition to Messrs. Cannon, Grow and Clayton, certain information is
furnished with respect to the following executive officers of the Company:
MAX E. SORENSON, 46, has been Senior Vice President of Engineering and
Technology of the Company since November 1991. He was Vice President of
Engineering from December 1989 through October 1991. Before joining the Company,
Mr. Sorenson was employed by Inland Steel Company, most recently as Manager of
Research and Development for Raw Materials and Primary Processes. Mr. Sorenson
holds a B.S. degree in Metallurgical Engineering from the University of Utah and
a Masters degree in Industrial Management from Purdue University.
4
<PAGE> 7
DENNIS L. WANLASS, 47, has been Vice President, Treasurer and Chief
Financial Officer of the Company since September 1989 and was Controller of the
Company from January 1988 to September 1989. Before joining the Company, Mr.
Wanlass was employed by Eastman Christensen, then a joint venture of Norton
Company and Texas Eastern, in various accounting and financial capacities. Mr.
Wanlass is a certified public accountant.
KEN C. JOHNSEN, 37, has been Vice President and General Counsel of the
Company since November 1991 and has served as Secretary of the Company since
February 1992. He was Manager of Special Projects for the Company from February
1991 through October 1991. From 1986 to 1991, Mr. Johnsen was engaged in the
private practice of law with Kimball, Parr, Waddoups, Brown & Gee, specializing
in corporate counseling and civil litigation. Mr. Johnsen received his law
degree from Yale Law School and a B.A. degree in Finance from Utah State
University.
PHILIP E. JONES, 60, has been Vice President of Customer Service and
Marketing of the Company since September 1990. From October 1989 to September
1990, Mr. Jones was Senior Director of Customer Service, Marketing and Sales of
the Company and was Manager of Customer Technical Services from October 1987 to
October 1989. Prior to joining the Company, he was a consultant to Lone Star
Steel and had been employed by USX for 30 years, primarily at the Geneva Steel
plant where he held several positions, including Chief Metallurgist. Mr. Jones
is a graduate of the University of Utah with a B.S. degree in Metallurgical
Engineering.
CARL E. RAMNITZ, 49, has been Vice President of Human Resources since
October 1988 and was Vice President of Human Resources and Public Affairs of the
Company from September 1987 to September 1988. Prior to joining the Company, he
was employed by USX Corporation ("USX") for 18 years in various employment and
labor related capacities, most recently as Manager of Employee Relations for the
Geneva Steel plant before it was acquired by the Company and for USX's
Pittsburg, California steel plant.
RALPH F. POWERS, 61, has been Vice President of Manufacturing of the
Company since May 1992. From December 1991 until May 1992, Mr. Powers was
General Manager of Operational Improvements for the Company. Prior to joining
the Company, Mr. Powers was employed by USX and its related entities for more
than 30 years, most recently as Project Director with USX Engineers and
Consultants, Inc., where he managed the commissioning, testing and start-up of
an $850 million cold rolling facility in West Java, Indonesia.
EXECUTIVE COMPENSATION
The compensation of Joseph A. Cannon, the Company's Chief Executive
Officer, and the four other most highly paid executive officers (collectively,
the "Named Executive Officers") is discussed in the following tables and in the
report from the Compensation Committee of the Board of Directors.
SUMMARY COMPENSATION TABLE
The following table sets forth, for the fiscal years ended September
30, 1995*, 1994 and 1993, the compensation paid to the Company's Named Executive
Officers.
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-----------------------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
-------------------------------------------- -------------------------- -------------------------
RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARD(S) OPTIONS PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($)(1) ($)(2) ($) ($)(3) (#)(4) ($) ($)(5)
- - -------------------- ------ -------- ---------- ------------ ---------- -------------- --------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Joseph A. Cannon 1995 469,054 105,086 12,475 0 48,000 0 21,652
Chief Executive 1994 450,000 31,236 0 0 12,000 0 17,829
Officer 1993 346,500 5,299 0 0 12,000 0 25,999
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-----------------------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
-------------------------------------------- -------------------------- -------------------------
RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARD(S) OPTIONS PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($)(1) ($)(2) ($) ($)(3) (#)(4) ($) ($)(5)
- - -------------------- ------ -------- ---------- ------------ ---------- -------------- --------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert J. Grow 1995 418,189 93,706 12,475 0 44,000 0 21,652
President and Chief 1994 400,000 27,931 0 0 11,000 0 17,829
Operating Officer 1993 334,000 4,710 0 0 11,000 0 22,058
Richard D. Clayton 1995 279,635 62,853 11,753 0 36,000 0 16,896
Executive Vice 1994 265,000 18,674 0 0 9,000 0 19,900
President 1993 202,750 3,120 0 0 9,000 0 18,883
Max E. Sorenson 1995 210,919 48,492 5,753 0 31,500 0 18,194
Senior Vice 1994 185,000 13,241 0 0 8,000 0 19,414
President 1993 163,250 2,178 0 0 7,500 0 16,768
Dennis L. Wanlass 1995 188,630 42,283 5,415 0 28,000 0 18,589
Vice President 1994 175,000 12,562 0 0 7,000 0 19,000
1993 160,750 2,061 0 0 7,000 0 16,561
</TABLE>
- - --------------------------
* The table also includes information with respect to the repricing of
previously granted options effected on November 28, 1995. See "--Ten-Year
Option/SAR Repricings" and "--Compensation Committee Report--Stock
Options."
(1) Includes compensation deferred or accrued at the election of the Named
Executive Officer under the Company's Management Employee Savings and
Pension Plan (the "Management Plan").
(2) Amounts for fiscal years 1995 and 1994 represent cash incentive bonuses for
performance in such fiscal years, as well as payments under the Company's
Performance Dividend Plan. Cash incentive bonuses for performance in fiscal
1994 were not included in last year's Summary Compensation Table as they
were determined and awarded subsequent to the 1995 annual meeting of
shareholders. See "--Compensation Committee Report-Incentive Bonuses."
Amounts for fiscal year 1993 represent only payments under the Performance
Dividend Plan.
(3) None of the Named Executive Officers received any restricted stock awards
during the three years presented, nor did any of them hold any such stock
as of September 30, 1995.
(4) 1995 option numbers represent new options granted on March 28, 1995, and
the repricing on November 28, 1995 of options granted to the Named
Executive Officers in fiscal years 1993 through 1995. See "--Ten-Year
Option/SAR Repricings" and "--Compensation Committee Report--Stock
Options." The number of new and replacement options reflected as 1995
grants are as follows: Joseph A. Cannon, 12,000 new, 36,000 replacements;
Robert J. Grow, 11,000 new, 33,000 replacements; Richard D. Clayton, 9,000
new, 27,000 replacement; Max E. Sorenson, 8,000 new, 23,500 replacements;
Dennis L. Wanlass, 7,000 new, 21,000 replacements.
(5) Includes contributions made by the Company pursuant to the Management Plan
and the dollar value of premiums paid by the Company pursuant to the
Company's split dollar life insurance plan. For fiscal year 1995, such
amounts were as follows: Joseph A. Cannon, $12,625 Company contributions,
$9,027 insurance
6
<PAGE> 9
premiums; Robert J. Grow, $12,625 Company contributions, $9,027 insurance
premiums; Richard D. Clayton, $10,746 Company contributions, $6,150
insurance premiums; Max E. Sorenson, $9,641 Company contributions, $8,553
insurance premiums; and Dennis L. Wanlass, $10,358 Company contributions,
$8,231 insurance premiums.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information with respect to individual
grants of stock options made by the Company to the Named Executive Officers
during the fiscal year ended September 30, 1995*. The Company did not grant any
stock appreciation rights during the fiscal year ended September 30, 1995.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
----------------------------------------------------------- POTENTIAL REALIZABLE VALUE AT
PERCENT OF ASSUMED ANNUAL RATES OF STOCK
NUMBER OF TOTAL OPTIONS PRICE APPRECIATION FOR OPTION
SECURITIES GRANTED TO EXERCISE OR TERM
UNDERLYING EMPLOYEES IN BASE PRICE EXPIRATION -----------------------------
NAME OPTIONS GRANTED(#) FISCAL YEAR** ($/SH)(5) DATE 5%($) 10%($)
- - ---------------------- ----------------- ------------ ----------- ---------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Cannon 12,000(1) 2.2% $11.96 03/28/00 N/A N/A
12,000(2) 2.2% 7.75 03/03/98 768 11,181
12,000(3) 2.2% 7.75 04/05/99 5,861 22,531
12,000(4) 2.2% 7.75 03/28/00 10,804 34,084
Robert J. Grow 11,000(1) 2.0% 11.96 03/28/00 N/A N/A
11,000(2) 2.0% 7.75 03/03/98 704 10,249
11,000(3) 2.0% 7.75 04/05/99 5,372 20,653
11,000(4) 2.0% 7.75 03/28/00 9,904 31,244
Richard D. Clayton 9,000(1) 1.6% 10.88 03/28/05 N/A N/A
9,000(2) 1.6% 7.75 03/03/03 20,005 56,088
9,000(3) 1.6% 7.75 04/05/04 24,881 69,798
9,000(4) 1.6% 7.75 03/28/05 29,613 83,752
Max E. Sorenson 8,000(1) 1.5% 10.88 03/28/05 N/A N/A
7,500(2) 1.4% 7.75 03/03/03 16,671 46,740
8,000(3) 1.5% 7.75 04/05/04 22,116 62,042
8,000(4) 1.5% 7.75 03/28/05 26,322 74,447
Dennis L. Wanlass 7,000(1) 1.3% 10.88 03/28/05 N/A N/A
7,000(2) 1.3% 7.75 03/03/03 15,560 43,624
7,000(3) 1.3% 7.75 04/05/04 19,352 54,287
7,000(4) 1.3% 7.75 03/28/05 23,032 65,141
</TABLE>
- - ----------------------
* The table also includes information with respect to the repricing of
previously granted options effected on November 28, 1995. See "--Ten-Year
Option/SAR Repricings" and "--Compensation Committee Report--Stock
Options."
** Percent of Total Options Granted has been calculated based on a number of
total options granted to employees in the fiscal year that includes the
repricing on November 28, 1995 of all options granted pursuant to the
Geneva Steel Key Employee Plan (the "Key Employee Plan") in fiscal years
1993 through 1995.
(1) Represents new options granted on March 28, 1995 pursuant to the Key
Employee Plan. Potential realizable value is not applicable, as the options
were cancelled and replaced on November 28, 1995.
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<PAGE> 10
(2) Represents the repricing on November 28, 1995 of options initially granted
March 3, 1993 under the Key Employee Plan. The repriced options granted to
Messrs. Cannon and Grow become exercisable according to the following
schedule: 60% on March 3, 1995, 15% on March 3, 1996, and 25% on March 3,
1997. The repriced options granted to the other Named Executive Officers
become exercisable according to the following schedule: 40% on March 3,
1995 and an additional 20% on each of the next three anniversaries thereof.
(3) Represents the repricing on November 28, 1995 of options initially granted
April 5, 1994 under the Key Employee Plan. The repriced options granted to
Messrs. Cannon and Grow become exercisable according to the following
schedule: 40% on April 5, 1996 and an additional 30% on each of the next
two anniversaries thereof. The repriced options granted to the other Named
Executive Officers become exercisable according to the following schedule:
40% on April 5, 1996 and an additional 20% on each of the next three
anniversaries thereof.
(4) Represents the repricing on November 28, 1995 of options initially granted
on March 28, 1995 under the Key Employee Plan. The options granted to
Messrs. Cannon and Grow become exercisable according to the following
schedule: 40% on March 28, 1997 and an additional 30% on each of the next
two anniversaries thereof. The options granted to the other Named Executive
Officers become exercisable according to the following schedule: 40% on
March 28, 1997 and an additional 20% on each of the next three
anniversaries thereof.
(5) On the date of repricing, the market price of the underlying Class A Common
Stock was $7.00 per share.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table sets forth information with respect to the exercise
of options to acquire shares of the Company's Class A Common Stock by the Named
Executive Officers during the fiscal year ended September 30, 1995, as well as
the aggregate number and value of unexercised options held by the Named
Executive Officers on November 28, 1995.*
<TABLE>
<CAPTION>
NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS AT
AT NOVEMBER 28, 1995(#) NOVEMBER 28, 1995($)
------------------------------ -----------------------------
SHARES ACQUIRED VALUE
NAME ON EXERCISE (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- - --------------------- -------------- ----------- ------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Cannon -0- -0- 7,200 28,800 -0- -0-
Robert J. Grow -0- -0- 48,100 27,900 -0- -0-
Richard D. Clayton -0- -0- 57,900 26,600 -0- -0-
Max E. Sorenson -0- -0- 40,500 23,500 -0- -0-
Dennis L. Wanlass -0- -0- 46,500 21,000 -0- -0-
</TABLE>
- - ----------------------
* The number and value of unexercised options are reported as of November 28,
1995, rather than September 30, 1995, in order to reflect the repricing of
certain previously granted options effected on such date. See "-- Ten-Year
Option/SAR Repricings" and "--Compensation Committee Report--Stock
Options."
8
<PAGE> 11
TEN-YEAR OPTION/SAR REPRICINGS
The following table sets forth information with respect to the repricing of
outstanding stock options that was effected on November 28, 1995. See
"--Compensation Committee Report--Stock Options." No other option repricings
have occurred since the Company became a reporting company in March 1990.
<TABLE>
<CAPTION>
NUMBER OF LENGTH OF ORIGINAL
SECURITIES MARKET PRICE OPTION TERM
UNDERLYING OF STOCK AT EXERCISE PRICE REMAINING AT DATE
OPTIONS/SARS TIME OF AT TIME OF NEW OF REPRICING OR
REPRICED OR REPRICING OR REPRICING OR EXERCISE AMENDMENT
NAME DATE AMENDED(#) AMENDMENT($) AMENDMENT($) PRICE($) (MONTHS)
- - ------------------------- --------- ------------- -------------- ------------- -------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Cannon 11/28/95 12,000 $7.00 $12.93 $7.75 27
Chief Executive 11/28/95 12,000 7.00 16.50 7.75 40
Officer 11/28/95 12,000 7.00 11.96 7.75 52
Robert J. Grow 11/28/95 11,000 7.00 12.93 7.75 27
President and 11/28/95 11,000 7.00 16.50 7.75 40
Chief Operating Officer 11/28/95 11,000 7.00 11.96 7.75 52
Richard D. Clayton 11/28/95 9,000 7.00 11.75 7.75 87
Executive Vice 11/28/95 9,000 7.00 15.00 7.75 100
President 11/28/95 9,000 7.00 10.88 7.75 112
Max E. Sorenson 11/28/95 7,500 7.00 11.75 7.75 87
Senior Vice 11/28/95 8,000 7.00 15.00 7.75 100
President 11/28/95 8,000 7.00 10.88 7.75 112
Dennis L. Wanlass 11/28/95 7,000 7.00 11.75 7.75 87
Vice President 11/28/95 7,000 7.00 15.00 7.75 100
11/28/95 7,000 7.00 10.88 7.75 112
Kenneth C. Johnsen 11/28/95 37,000 7.00 11.75 7.75 87
Vice President 11/28/95 7,000 7.00 15.00 7.75 100
11/28/95 7,000 7.00 10.88 7.75 112
Philip E. Jones 11/28/95 5,000 7.00 11.75 7.75 87
Vice President 11/28/95 5,500 7.00 15.00 7.75 100
11/28/95 5,500 7.00 10.88 7.75 112
Carl E. Ramnitz 11/28/95 5,500 7.00 11.75 7.75 87
Vice President 11/28/95 5,500 7.00 15.00 7.75 100
11/28/95 5,500 7.00 10.88 7.75 112
Ralph F. Powers 11/28/95 6,000 7.00 11.75 7.75 87
Vice President 11/28/95 6,000 7.00 15.00 7.75 100
11/28/95 6,000 7.00 10.88 7.75 112
</TABLE>
EMPLOYMENT AGREEMENTS
The Company maintained during fiscal year 1995 a supplemental
retirement plan (the "Supplemental Plan") which benefits certain executive
officers and management personnel. The Supplemental Plan generally provides for
the payment of supplemental benefits to covered individuals upon retirement at
age 62, based on the number of years of Company employment. The maximum benefit
under the Supplemental Plan, which is available after sixteen and two-thirds
years of service, is $50,000 per year, payable for ten years. All of the Named
Executive Officers are covered by the Supplemental Plan.
9
<PAGE> 12
COMPENSATION COMMITTEE REPORT
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that incorporates by reference, in
whole or in part, subsequent filings including, without limitation, this Proxy
Statement, the following Report of the Compensation Committee and the
Performance Graph hereinbelow set forth shall not be deemed to be incorporated
by reference into any such filings.
As required by the proxy rules promulgated by the Securities and
Exchange Commission (the "SEC"), this Report of the Compensation Committee (the
"Committee") of the Board of Directors describes the overall compensation goals
and policies applicable to the executive officers of Geneva, including the bases
for determination of the compensation of executive officers for fiscal year
1995. The Report also discusses the setting of 1995 compensation of Mr. Cannon.
The term "Executive Officers" is used below to refer to the executive officers
of Geneva other than Mr. Cannon.
Composition and Functions of the Committee. The Compensation Committee
of the Board of Directors of Geneva is comprised entirely of independent,
non-employee directors. Subject to any action which may be taken by the full
Board of Directors, the Board has delegated to the Committee the authority:
1. To determine the compensation of Joseph A. Cannon, Chairman of the
Board and Chief Executive Officer of Geneva, including discretionary awards
under Geneva's incentive compensation plans;
2. To approve, upon recommendations by Mr. Cannon, the compensation
arrangements of Executive Officers of Geneva, including the Named Executive
Officers identified in the Summary Compensation Table above; and
3. To carry out the duties and responsibilities of the Board of
Directors regarding Geneva's other compensation plans, including administering
and making awards under Geneva's Key Employee Plan to Mr. Cannon, the
Executive Officers and other managers and key employees of Geneva.
Compensation Philosophy and Objectives. The Committee believes that
compensation of Geneva's executive officers should be set at a competitive level
and be based upon the Company's overall financial performance, achievement of
strategic goals, and individual performance, with a view toward building value
for the Company's shareholders. Within this overall philosophy, the following
principles guide Geneva's compensation policies for executive officers:
- Provide competitive levels of compensation that enable Geneva to
attract and retain experienced, talented executive officers;
- Compensate executive officers based on the Company's progress toward
achievement of its short and long-term strategic goals, as well as financial
results;
- Compensate executive officers based on the performance of the
individual executive officer, and his contribution to the Company's performance;
and
- Maintain and strengthen the incentive for executive officers to
increase the price of Geneva's Class A Common Stock.
The Committee believes that adherence to these objectives is essential in order
to attract and retain highly-qualified officers whose contributions are
necessary for the continued growth and success of Geneva. Information concerning
the specific implementation of these policies in the 1995 compensation
arrangements of the Executive Officers and Mr. Cannon is provided below. The
Committee believes that the $1.0 million compensation deduction cap recently
promulgated under the Internal Revenue Code currently has no effect on the
Company's compensation policies.
10
<PAGE> 13
Annual Salaries. Salaries of Executive Officers are generally reviewed
on an annual basis and adjustments may be made based on the Committee's
subjective evaluation of the individual's performance, taking into account both
qualitative and quantitative factors. Among the factors considered by the
Committee have been the recommendations of Mr. Cannon and the importance of
retaining key Executive Officers who have, from time to time, been presented
with other employment offers. The Committee makes the final compensation
decisions concerning the Executive Officers. In setting salary levels for fiscal
year 1995, the Committee determined to approve a schedule of modest increases in
base salaries of the Executive Officers, based primarily on the Committee's
subjective evaluation of the Executive Officer's contribution to aggregate
Company performance, with more significant increases for two Executive Officers
whose compensation was viewed by the Committee as below-market for those two
Executive Officers' qualifications and responsibilities.
Incentive Bonuses. In fiscal 1995, Geneva continued to make awards
under the Performance Dividend Plan (the "Performance Plan") established in June
1993, which provides for the monthly payment of additional cash compensation to
all management and union employees based upon the Company's volume of product
shipments. Cash payments made to Executive Officers under the Performance Plan
during fiscal year 1995 were determined according to the same formula used to
determine payments to all other managers.
The compensation of Executive Officers has at times also included
incentive compensation in the form of cash bonuses based on overall Company
performance, determined subjectively rather than pursuant to an objective
formula or criteria. In fiscal 1995, the Committee approved, and the Executive
Officers were paid, an incentive bonus of 5% of their 1994 base salaries, in
consideration of the significant efforts of the Executive Officers in fiscal
1994 toward the advancement of substantial components of the Company's
modernization program and positioning the Company for more efficient operations
in the future. The Committee had deferred consideration of cash bonuses for the
Executive Officers and Mr. Cannon in fiscal 1994 to enable the Committee to
assess more effectively the results of the implementation of then-recent phases
of the Company's modernization efforts.
In addition, the Executive Officers were awarded an incentive bonus of
15% of their base salaries, following the conclusion of fiscal year 1995, for
performance during fiscal 1995. In determining to award the bonuses, the
Committee considered key accomplishments during fiscal 1995, including the
completion of modernization projects, ratification of a favorable labor
agreement, and the improved financial results obtained in fiscal 1995. The
Committee determined to award an equal percentage bonus to each of the Executive
Officers, as it considered the fiscal 1995 accomplishments to be the result of
the collective effort of all Executive Officers rather than attributable to
individual achievements.
Stock Options. Geneva's Key Employee Plan provides the ability to award
to executive officers, managers and key employees, options to purchase Class A
Common Stock. The award of stock options is intended to align the interests of
the executive officers with the shareholders by providing the executive officers
with an incentive to bring about increases in the price of Class A Common Stock.
Geneva's policy is to award options to purchase Class A Common Stock at a price
that equals or exceeds the market price on the date of grant. Accordingly, the
executive officers derive a financial benefit from the option only if the price
of Class A Common Stock increases.
Options granted under the Key Employee Plan have not had performance
contingencies, but realization of the value provided through the options has
generally required the executive officer to remain employed by Geneva until the
options vest. Options granted under the Key Employee Plan generally have vested
at the rate of 40% of the underlying shares at the end of two years following
the grant and an additional 20% each year thereafter. The options are generally
exercisable for ten years from the date of grant at a price equal to 100% of the
fair market value of the underlying shares on such date. Because each of Messrs.
Cannon and Grow beneficially owns more than 10% of the voting power of the
Company, applicable tax laws require that incentive stock options granted to
them must be exercisable for no more than five years at a price equal to 110% of
the fair market value on the date of grant. Consequently, incentive stock
options granted to Messrs. Cannon and Grow generally vest in four rather than
five years.
In fiscal 1995, the Committee determined to award 59,000 options to
purchase Class A Common Stock to Executive Officers of the Company. The number
of options awarded to Executive Officers was based upon the
11
<PAGE> 14
Committee's assessment of the contribution of the Executive Officers toward
accomplishment of Company objectives. These options were subsequently repriced
in the November 1995 repricing discussed below.
On November 28, 1995, the Committee reviewed the status of outstanding
stock options granted under the Key Employee Plan to executive officers in
fiscal years 1992 through 1995. The Committee determined that options with
exercise prices significantly in excess of the current market value of the Class
A Common Stock do not serve as a meaningful performance incentive to the
officers and more than 65 key employees who hold them. Moreover, the Committee
concluded that recent declines in the market value of the Class A Common Stock
are due, in part, to the cyclical nature of the steel industry, a factor which
is not within the control of the option holders. The Committee further noted
that the efforts of executive officers and other key employees who were granted
such options are critical to the Company's current operations and future
prospects, and that existing options represented no inducement to continue
employment with the Company for executive officers and key employees who have
been presented with other employment options. Accordingly, the Committee
determined to reprice the options granted to all executive officers and key
employees pursuant to the Key Employee Plan in fiscal years 1992 through 1995 at
the greater of $7.75 or 110% of fair market value. The exercise price for the
replacement options was set at $7.75. The repriced options did not involve any
right to acquire a greater number of shares, nor any extension of expiration
dates, nor any shortening or other alteration of the vesting schedules of the
previously granted options. There have been no other repricings of options since
the Company became a reporting Company in March 1990.
Compensation of Chief Executive Officer. The Committee approved an
increase of approximately 4% of Mr. Cannon's base salary for fiscal 1995,
consistent with increases in 1995 base salaries of the Executive Officers. In
fiscal 1995, the Committee approved, and Mr. Cannon was paid, a bonus of 5% of
his 1994 base salary, consistent with the bonuses for 1994 performance awarded
to the Executive Officers as described above. In addition, following the
conclusion of fiscal 1995, the Committee determined to award Mr. Cannon a cash
incentive bonus of 15% of his 1995 base salary, also consistent with the cash
incentive bonuses awarded to the Executive Officers for 1995, in recognition of
Mr. Cannon's role in the achievement of the key accomplishments in fiscal 1995
enumerated above. During the past fiscal year, Mr. Cannon received additional
compensation of $34,061 pursuant to the Performance Plan, based upon the formula
applicable to all Executive Officers and managerial employees. Mr. Cannon was
also granted options for the purchase of 12,000 shares of Class A Common Stock,
for the reasons stated above. These options were subsequently repriced in the
November 1995 repricing discussed above.
Other Compensation Plans. The Company maintains insurance and
retirement agreements with certain of its executive officers and managers,
including Mr. Cannon and the Named Executive Officers, which provide for payment
of a death benefit (net of premiums paid and recovered by the Company) to a
designated beneficiary or for payment of a retirement benefit upon reaching age
62. Geneva also has a number of other broad-based employee benefit plans in
which executive officers participate on the same terms as other employees
meeting the eligibility requirements, subject to any legal limitations on
amounts that may be contributed to or benefits payable under the plans.
Submitted by the Compensation Committee of the Board of Directors:
A. Blaine Huntsman
A. Thurl Jacobson
Arch L. Madsen
R. J. Shopf
12
<PAGE> 15
PERFORMANCE GRAPH
The following graph shows a comparison of cumulative total shareholder
return on the Company's Class A Common Stock, calculated on a dividend
reinvested basis, from September 30, 1991 through September 30, 1995, compared
with the S&P 500 Index and the S&P Steel Index.
CUMULATIVE TOTAL RETURN
BASED ON REINVESTMENT OF $100 BEGINNING SEPTEMBER 30, 1991
<TABLE>
<CAPTION>
- - -----------------------------------------------------------------------
Sep-91 Sep-92 Sep-93 Sep-94 Sep-95
- - -----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Geneva Steel $100 $ 42 $ 69 $100 $ 44
- - -----------------------------------------------------------------------
S&P 500 $100 $ 94 $106 $110 $143
- - -----------------------------------------------------------------------
S&P Steel Index $100 $ 85 $134 $172 $122
- - -----------------------------------------------------------------------
</TABLE>
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors to file initial reports of ownership
and reports of changes in ownership with the SEC and the New York and Pacific
Stock Exchanges. Executive officers and directors are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file. Based solely on 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 noted that all required forms were timely filed during
the past fiscal year.
13
<PAGE> 16
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table sets forth information as of December 31, 1995 with
respect to the beneficial ownership of shares of the Class A Common Stock and
Class B Common Stock by each person known by the Company to be the beneficial
owner of more than 5% of either of such classes of Common Stock, by each
director or nominee, by each of the Named Executive Officers, and by all
directors and officers as a group. The number of Class A Shares listed below
does not include Class A Shares issuable upon conversion of Class B Shares.
Unless otherwise noted, each person named has sole voting and investment power
with respect to the shares indicated. The percentages set forth below have been
computed based on the number of outstanding securities, excluding treasury
shares held by the Company, and are based on 13,343,871 shares of Class A and
19,151,348 shares of Class B Common Stock outstanding as of December 31, 1995:
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP
AS OF DECEMBER 31, 1995*
-------------------------------------
PERCENTAGE OF
NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER OF CLASS
SHARES OUTSTANDING
- - --------------------------------------------------------------------------- ----------------- -----------------
<S> <C> <C>
Class A Common Stock:
Wellington Management Company.............................................. 1,525,200(1) 11.43%
75 State Street
Boston, Massachusetts 02109
Robert J. Grow............................................................. 68,700(2) **
Richard D. Clayton......................................................... 57,900(3) **
Dennis L. Wanlass.......................................................... 46,500(3) **
Max E. Sorenson............................................................ 40,500(3) **
A. Blaine Huntsman......................................................... 30,000(4) **
R. J. Shopf................................................................ 12,300 **
Joseph A. Cannon........................................................... 10,456(5) **
Richard B. Wirthlin........................................................ 10,100 **
Arch L. Madsen............................................................. 1,000 **
A. Thurl Jacobson.......................................................... 560 **
All directors and officers as a group (13 persons)......................... 327,316(6) 2.41%
Class B Common Stock (7):
Joseph A. Cannon........................................................... 10,142,204(8) 52.96%
Robert J. Grow............................................................. 8,855,319 46.24%
Richard D. Clayton......................................................... 33,825(9) **
All directors and officers as a group (3 persons).......................... 19,031,348 99.37%
</TABLE>
- - ----------------------
14
<PAGE> 17
* Beneficial ownership as a percentage of the class for each person holding
options exercisable within 60 days has been calculated as though shares
subject to such options were outstanding, but such shares have not been
deemed outstanding for the purpose of calculating the percentage of the
class owned by any other person.
** Less than 1% of outstanding shares.
(1) Shares held by Wellington Management Company are held as investment advisor
for numerous investment counseling clients, including the Windsor Fund,
Inc., which is the only such client known to hold more than 5% of the
outstanding Class A Common Stock. Wellington Management Company may be
deemed to be the beneficial owner of the shares by virtue of the investment
and/or voting discretion it possesses pursuant to its investment advising
agreements with its clients.
(2) Includes 48,100 shares subject to presently exercisable options and 15,500
shares owned by Mr. Grow's spouse which may be deemed to be beneficially
owned by him. Mr. Grow disclaims beneficial ownership of the shares owned
by his spouse.
(3) Represents shares subject to presently exercisable options.
(4) Includes 1,000 shares owned by Mr. Huntsman's spouse and 9,000 shares owned
by Evergreen Investment, Ltd., a Utah limited partnership in which Mr.
Huntsman is a limited partner with 17.5% ownership. All such shares may be
deemed to be beneficially owned by Mr. Huntsman; however, he disclaims
beneficial ownership of all such shares.
(5) Includes 3,156 shares held by Riverwood Limited Partnership, of which
Joseph A. Cannon is general partner, and 7,200 shares subject to presently
exercisable options.
(6) Includes 248,300 shares subject to presently exercisable options.
(7) The Class B Common Stock is convertible into Class A Common Stock at a rate
of ten shares of Class B Common Stock for one share of Class A Common
Stock. If they were to convert their shares of Class B Common Stock into
shares of Class A Common Stock, Mr. Cannon would beneficially own 1,024,676
shares of Class A Common Stock, Mr. Grow would beneficially own 954,232
shares of Class A Common Stock (including shares owned by his spouse), Mr.
Clayton would beneficially own 61,283 shares of Class A Common Stock
(including shares owned by his spouse) and all directors and officers as a
group would beneficially own 2,230,451 shares of Class A Common Stock
(including all shares subject to presently exercisable options). In the
event of such conversions, Mr. Cannon would own 6.7% of the outstanding
Class A Common Stock; Mr. Grow would own 6.2% of the outstanding Class A
Common Stock; Mr. Clayton would own less than 1.0% of the outstanding Class
A Common Stock; and all directors and officers as a group would own 14.4%
of the outstanding Class A Common Stock.
(8) Includes 828,013 shares held by Riverwood Limited Partnership, of which
Joseph A. Cannon is general partner.
(9) Includes 16,830 shares owned by Mr. Clayton's spouse which may be deemed to
be beneficially owned by him. Mr. Clayton disclaims beneficial ownership of
such shares.
Joseph A. Cannon and Robert J. Grow together beneficially own 99.2% of
the outstanding shares of Class B Common Stock and 59.0% of the total voting
power of the Company. They are therefore able to determine the outcome of
fundamental corporate transactions such as the election of directors, amendments
of the Company's articles of incorporation (except for certain amendments which
are, by mandatory provisions of law, subject to a class vote of shareholders)
and sale of all or substantially all of the Company's assets, and to prevent
certain mergers or consolidations involving the Company. Joseph A. Cannon has
obtained loans of approximately $3.0 million from a bank which are
collateralized by a pledge of Class B Common Stock. Enforcement of the loan
agreement could decrease the Class B Common Stock held by Mr. Cannon and other
restrictions applicable to the transfer of Class B Common Stock could affect the
relative control positions of Messrs. Cannon and Grow.
15
<PAGE> 18
RATIFICATION OF SELECTION OF AUDITOR
The Audit Committee has recommended, and the Board of Directors has
selected, the firm of Arthur Andersen LLP, independent certified public
accountants, to audit the financial statements of the Company for the fiscal
year ending September 30, 1996, subject to ratification by the shareholders.
Arthur Andersen LLP has acted as independent auditor of the Company since 1987.
The Board of Directors anticipates that one or more representatives of Arthur
Andersen LLP will be present at the Annual Meeting, will have an opportunity to
make a statement if they so desire and will be available to respond to
appropriate questions.
The Board of Directors recommends that shareholders vote FOR
ratification of the appointment of Arthur Andersen LLP as the Company's
independent auditor.
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors knows of
no other matters to be presented for action at the Annual Meeting. However, if
any further business should properly come before the meeting, the persons named
as proxies in the accompanying form will vote on such business in accordance
with their best judgment.
PROPOSALS OF SHAREHOLDERS
Proposals which shareholders intend to present at the annual meeting of
shareholders to be held in calendar year 1997 must be received by Ken C.
Johnsen, Vice President, Secretary and General Counsel of the Company, at the
Company's executive offices, 10 South Geneva Road, Vineyard, Utah 84058, no
later than September 30, 1996.
ADDITIONAL INFORMATION
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO ANY PERSON FROM WHOM A PROXY
IS SOLICITED BY THE BOARD OF DIRECTORS, UPON THE WRITTEN REQUEST OF SUCH PERSON,
A COPY OF THE COMPANY'S 1995 ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL
STATEMENTS AND SCHEDULES THERETO (AS WELL AS EXHIBITS THERETO, IF SPECIFICALLY
REQUESTED), REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.
WRITTEN REQUESTS FOR SUCH INFORMATION SHOULD BE DIRECTED TO THE CORPORATE
COMMUNICATIONS DEPARTMENT OF THE COMPANY.
16
<PAGE> 19
PROXY
GENEVA STEEL COMPANY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Joseph A. Cannon, Robert J. Grow and Ken C.
Johnsen, and each of them, as proxies, with full power of substitution, and
hereby authorizes them to represent and vote, as designated below, all shares of
Common Stock of Geneva Steel Company, a Utah corporation (the "Company"), held
of record by the undersigned on January 24, 1996 at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held at the Screening Room, Sundance
Resort, Sundance, Utah 84604, on March 26, 1996, at 10:00 a.m., local time, or
at any adjournment or postponement thereof, upon the matters set forth below,
all in accordance with and as more fully described in the accompanying Notice of
Annual Meeting and Proxy Statement, receipt of which is hereby acknowledged.
1. ELECTION OF DIRECTORS, each to serve until the next annual meeting of
shareholders of the Company and until their respective successors shall
have been duly elected and shall qualify.
/ / FOR all nominees listed below (except as marked to the contrary).
/ / WITHOUT AUTHORITY to vote for all nominees listed below.
(INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the nominee's name in the list below.)
JOSEPH A. CANNON ROBERT J. GROW ARCH L. MADSEN RICHARD B. WIRTHLIN
RICHARD D. CLAYTON A. BLAINE HUNTSMAN R.J. SHOPF
2. PROPOSAL TO RATIFY the appointment of Arthur Andersen LLP as the
independent auditor of the Company.
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting.
(continued)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR THE ELECTION OF THE DIRECTOR NOMINEES NAMED ABOVE, AND FOR THE
RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE INDEPENDENT
AUDITOR OF THE COMPANY.
Please complete, sign and date this proxy where indicated and return it
promptly in the accompanying prepaid envelope.
DATED: _________________________________, 1996
____________________________
Signature
____________________________
Signature if held jointly
(Please sign above exactly as the shares are issued. When shares are held
by joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other authorized
officer. If a partnership, please sign in partnership name by authorized
person.)
