14
PROXY PROXY
For the Annual Meeting Of Shareholders of
ACX TECHNOLOGIES, INC.
16000 Table Mountain Parkway
Golden, Colorado 80403
Proxy Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Jeffrey H. Coors or Joseph
Coors, Jr., or either of them, as proxies, with power of
substitution, to vote all the shares of the undersigned held of
record by the undersigned as of March 26, 1997, with all of the
powers which the undersigned would possess if personally present
at the Annual Meeting Of Shareholders of ACX Technologies, Inc.
(the "Company"), to be held at 10:30 A.M. (local time) on May 13,
1997 at the Arvada Center For The Arts And Humanities, 6901
Wadsworth Boulevard, Arvada, Colorado, or any adjournments
thereof.
The Board of Directors recommends a vote FOR the nominees for
director listed below:
(1) ELECTION OF DIRECTORS
FOR all Nominees listed below [ ] WITHHOLD AUTHORITY [ ]
(except as marked to the contrary below) To Vote for all Nominees
below
John D. Beckett
John K. Coors
William K. Coors
To withhold authority to vote for any nominee, line through the
name of the nominee above.
The Board of Directors recommends a vote FOR the following
proposal:
(2) Proposal to approve the ACX Technologies, Inc. Equity
Incentive Plan, as amended.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
Unless contrary instructions are given, the shares represented
by this proxy will be voted FOR the election of all named nominee
directors and in favor of Item 2.
EVEN IF YOU PLAN TO ATTEND THE MEETING, PLEASE VOTE, DATE, SIGN
AND RETURN THIS PROXY IN THE ACCOMPANYING ENVELOPE.
Date:___________________________________
Signature:_______________________________
Signature:________________________________
(Please sign exactly as shown on your
stock certificate and on the envelope
in which this proxy was mailed. When
signing as partner, corporate officer, attorney,
executor, administrator, trustee, guardian, etc.,
give full title as such and sign your own
name as well. If stock is held jointly,
each joint owner should sign.)
ACX TECHNOLOGIES, INC., 16000 Table Mountain Parkway, Golden, Colorado 80403
(303) 271-7000
Notice of Annual Meeting of Shareholders
To Be Held May 13, 1997
The Annual Meeting of Shareholders of ACX Technologies, Inc.
("ACX" or the "Company"), a Colorado corporation, will be held on
May 13, 1997 at 10:30 A.M. (local time) at the Arvada Center For
The Arts And Humanities, 6901 Wadsworth Boulevard, Arvada,
Colorado, for the following purposes:
1. To elect three directors for a three-year term;
2. To approve the ACX Technologies, Inc. Equity
Incentive Plan, as amended;
and to transact any other business that may properly come before
the meeting.
Shareholders of the Company of record at the close of business on
March 26, 1997 are entitled to vote at the meeting and any
adjournment of the meeting.
Whether you expect to attend the meeting in person, please mark,
sign, date, and return the accompanying proxy in the return
envelope provided. No postage is necessary if mailed in the
United States. Any person giving a proxy has the power to revoke
it at any time, and shareholders who are present at the meeting
may withdraw their proxies and vote in person.
ALL SHAREHOLDERS ARE EXTENDED A CORDIAL INVITATION TO ATTEND THE
SHAREHOLDERS' MEETING.
By Order of the Board of Directors,
Jill B. W. Sisson, Secretary
March 31, 1997
PROXY STATEMENT
_____________________________________________________________________________
This Proxy Statement is provided in connection with the
solicitation of proxies by the Board of Directors of ACX
Technologies, Inc. (the "Company") to be voted at the Annual
Meeting of Shareholders on May 13, 1997 or at any adjournment or
postponement of the Meeting. The Proxy Statement and Proxy card
will be first mailed or given to shareholders of the Company on
or about March 31, 1997.
The shares will be voted according to the shareholders'
directions when executed properly. Unless otherwise directed,
the shares represented by proxies will be voted "For" all
nominees and the proposal on the enclosed Notice of Annual
Meeting.
A shareholder giving a proxy may revoke it at any time
before it is exercised by delivering written notice of revocation
to the Company, by substituting a new proxy executed at a later
date, or by requesting, in person at the Annual Meeting, that the
proxy be returned.
Shareholders of record at the close of business on March 26,
1997 will be entitled to vote at the meeting. As of March 26,
1997, there were 27,973,820 shares of the Company's $.01 par
value common stock outstanding (the "Common Stock"), each share
being entitled to one vote. A majority of the outstanding shares
entitled to vote must be represented in person or by proxy at the
Meeting in order to constitute a quorum for the transaction of
business. The affirmative vote of a majority of the shares
represented at the meeting and entitled to vote is required for
the approval of the proposal contained in this Proxy Statement.
The election of directors requires a plurality of the votes cast
at the meeting. Also, Cumulative voting is not allowed in the
election of directors or for any other purposes.
Votes that are withheld for a nominee in the election of
directors will be excluded entirely from the vote and will have
no effect. Abstentions on the proposal will have the effect of a
negative vote because the proposal requires the affirmative vote
of a majority of shares present in person or by proxy and
entitled to vote. Shares registered in the names of brokers or
other "street name" nominees for which proxies are voted on some,
but not all matters, will be considered to be voted only as to
those matters actually voted, and will not be considered for any
purpose as to the matters with respect to which a beneficial
holder has not provided voting instructions (commonly referred to
as "broker non-votes"). Under Colorado law, a broker non-vote
will have no effect on the outcome of the proposal to be voted on
at the meeting. The rules of the New York Stock Exchange require
that the votes cast for and against the proposal represent over
50 percent of the shares entitled to vote. Accordingly,
abstentions or broker non-votes can affect the outcome of the
vote.
The solicitation of proxies will be made principally by mail;
however, following the original solicitation, further solicitations
may be made by telephone or oral communication with shareholders of
the Company. Officers, directors and employees of the Company may
solicit proxies but without receiving any special compensation.
Arrangements also will be made with brokerage houses and other
custodians, nominees and fiduciaries to forward solicitation
materials to beneficial owners of the shares held of record. The
Company will reimburse brokers and other persons representing
beneficial owners for their expenses in forwarding solicitation
materials. All of the expenses involved in preparing, assembling
and mailing this Proxy Statement and the enclosed material will be
paid for by the Company.
The Company was formed in August 1992 as a holding company
for the packaging, ceramics, aluminum and developmental
businesses formerly owned by Adolph Coors Company ("ACCo").
Effective December 27, 1992, ACCo distributed to its shareholders
all then outstanding shares of the Company's common stock (the
"Spin-Off"). The principal subsidiary of ACCo is Coors Brewing
Company ("Coors Brewing" or "CBC"). Unless the context indicates
otherwise, the term the "Company" or "ACX" is used in this Proxy
Statement to include ACX Technologies, Inc. ("ACX Technologies")
and any of its subsidiaries that existed during the period of
reference including Coors Porcelain Company and its subsidiaries
(collectively referred to as "Coors Ceramics" or "CCC"), Graphic
Packaging Corporation and its subsidiaries (collectively referred
to as "Graphic Packaging" or "GPC"), Golden Technologies Company,
Inc. and its subsidiaries (collectively referred to as "Golden
Technologies" or "GTC"), and Golden Aluminum Company and its
subsidiaries (collectively referred to as "Golden Aluminum" or
"GAC"). In March 1997, the Company sold GAC to Crown Cork &
Seal, as previously reported by the Company, under an agreement
which gives Crown Cork & Seal the right to transfer GAC back to
the Company within two years.
ELECTION OF DIRECTORS
_____________________________________________________________________________
The Board of Directors of the Company (the "Board") is
divided into three classes, designated Class I, Class II and
Class III, each class being elected for a three-year term. Three
Class III directors will be elected at the upcoming 1997 Annual
Meeting, two Class I directors at the 1998 Annual Meeting, and
three Class II directors at the 1999 Annual Meeting. Each of the
nominees is an incumbent director of the Company and has
consented to serve on the Board if elected. If any of the
nominees for director should be unavailable for election, the
proxies will be voted for a substitute nominee(s) designated by
the Board. Information with respect to the nominees and each
current director whose term continues after the Annual Meeting
follows:
Principal Occupation or Employment
and Directorships Director
Age Since
NOMINEES FOR ELECTION AS CLASS III DIRECTORS
JOHN D. BECKETT 58 1993
President of the R. W. Beckett Corporation, a manufacturer
of components for oil and gas heating, since 1965;
Employed by Lear Siegler in an engineering capacity from
1960 to 1963.
JOHN K. COORS 40 1996
President and Chief Executive Officer of Photocomm, Inc., a
majority-owned subsidiary of GTC and an integrator and
distributor of solar electric systems, since January 1997;
President of Golden Genesis Company, a subsidiary of GTC,
and Vice President of GTC since July 1992; Vice President and
Plant Manager of Coors Brewing Company's Memphis, Tennessee
brewery from January to July 1992; also a director of
Photocomm, Inc.
WILLIAM K. COORS 80 1992
Chairman of the Company since its formation in August 1992;
Chairman of ACCo since 1989; President of ACCo since 1989;
also a director of ACCo since 1940.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" EACH OF THE NOMINEES LISTED ABOVE
Principal Occupation or Employment
and Directorships
Director
Age Since
CLASS I DIRECTORS WHOSE TERMS EXPIRE AT THE 1998 ANNUAL MEETING
JEFFREY H. COORS 52 1992
President of the Company since its formation in August 1992
and Chairman of Graphic Packaging and Golden Technologies
since 1985 and 1989, respectively; Executive Vice President
of ACCo from 1991 to 1992; President of Coors Technology
Companies from 1989 to 1992; President of ACCo from 1985
to 1989; also a director of Photocomm, Inc.
JOHN H. MULLIN, III 55 1992
Chairman of Ridgeway Farm, Inc. (June 1989 to present), a
wholesale tree nursery; Managing Director of Dillon,
Read & Co. Inc., an investment banking firm from 1979 to
1989; Director of ACCo from 1989 to 1992; also a director
of The Liberty Corp., The Ryland Group, Inc., Dillon, Read & Co.
Inc., and Alex Brown Realty, Inc., a real estate investment firm.
CLASS II DIRECTORS WHOSE TERMS EXPIRE AT THE 1999 ANNUAL MEETING
JOSEPH COORS, JR. 55 1992
President of the Company since its formation in August 1992;
Chairman of Coors Ceramics since 1989 and President and
Chief Executive Officer of Coors Ceramics since March 1997;
Chairman of Golden Aluminum from 1993 to 1997; Executive Vice
President of ACCo from 1991 to 1992; President of Coors Ceramics
from 1985 to 1993; also a director of Hecla Mining Company.
RICHARD P. GODWIN 75 1992
Chairman and Chief Executive Officer of Vintage Group, Inc.,
a winery, since 1993; Director of Versatron Inc. since 1995;
Director of ACCo from 1989 to 1992; U.S. First Under Secretary
of Defense for Acquisition from 1986 to 1988; Employed
by Bechtel, Inc. from 1961 to 1986, most recent positions were
Vice Chairman and director.
JOHN HOYT STOOKEY 67 1993
Chairman of Suburban Propane since March 1996; Non-executive
Chairman of Quantum Chemical Company, a subsidiary of
Hanson PLC, from 1993 to March 1996; President and Chairman
of Quantum Chemical Corporation from 1985 to 1993;
From 1989 to 1993, executive officer of Petrolane Incorporated,
Petrolane Finance Corporation and QJV Corporation, which
companies were reorganized on July 15, 1993 under the U.S.
Bankruptcy Code; also a trustee of United States Trust Company
of New York and a director of Chesapeake Corporation, Cyprus Amax
Minerals Company and Suburban Propane Partners.
BOARD OF DIRECTORS AND BOARD COMMITTEES
_____________________________________________________________________________
The Board of Directors held four regular meetings and two
special meetings during 1996. Each director attended at least 75
percent of the aggregate number of meetings of the Board and the
committees on which he served.
Joseph Coors was a member of the Board until August 1996
when he retired and was named Director Emeritus by the Board. As
Director Emeritus, Mr. Coors provides advice and consulting
services to the Board. For these services, he participates in
the Company's Equity Compensation Plan for Non-Employee Directors
and receives an annual retainer, as described below. However, he
is not a voting member of the Board and is not counted for quorum
purposes.
The Board has established three standing committees: Audit,
Compensation and Executive. There is no nominating or other
committee performing similar functions.
The Audit Committee, which consists of two non-employee
directors, met four times last year. The Committee reviews the
scope and results of the audit of the Company by the Company's
independent accountants and makes recommendations to the Board as
to the selection of independent accountants. In addition, the
Committee reviews, with the independent accountants, systems of
internal control and accounting policies and procedures, and
directs and supervises investigations into matters within the
scope of its duties. The current members of the Audit Committee
are: John D. Beckett and Richard P. Godwin. John Hoyt Stookey
was a member of the Committee until May 1996.
The Compensation Committee, which consists of two non-
employee directors, met six times last year. The Committee makes
recommendations to the Board concerning matters related to
compensation for certain management personnel and certain
executive and management incentive and benefit plans. The
current members of the Compensation Committee are: John H.
Mullin, III and John Hoyt Stookey. William K. Coors was a member
of the Committee until May 1996.
The Executive Committee, which consists of one non-employee
and two employee directors, met one time last year. The
Committee has all of the authority of the Board in the management
of the business and affairs of the Company except as provided in
the Articles, Bylaws and applicable law. The current members of
the Executive Committee are: Jeffrey H. Coors, Joseph Coors, Jr.
and William K. Coors. Joseph Coors was a member of the Committee
until August 1996.
Compensation of Directors
Employee directors do not receive additional compensation
for serving as directors of the Company. Each non-employee
director and the Director Emeritus of the Company receive an
annual retainer of $32,000, 20 percent of which is paid in shares
of Common Stock. The balance of the retainer is paid in cash
unless the non-employee director or the Director Emeritus elects
to take all or a portion of it in Common Stock. All shares of
Common Stock received by non-employee directors and the Director
Emeritus are subject to forfeiture until completion of the annual
term which ends on the date of the annual shareholders' meeting
following receipt of the shares. In addition, each non-employee
director receives a grant of 2,000 non-qualified stock options at
the beginning of his three-year term as director. The options
vest in equal increments over the three-year period and expire,
if unexercised, six years from the date they vest. No additional
amounts are paid to directors for committee meetings. Directors
and the Director Emeritus are reimbursed for expenses incurred
while attending Board or committee meetings and in connection
with any other Company business. In addition, the Company
purchases accidental death and dismemberment insurance for the
non-employee directors and the Director Emeritus.
Family Relationships
Jeffrey H. Coors, John K. Coors and Joseph Coors, Jr. are
brothers, and are sons of Joseph Coors and nephews of William K.
Coors.
PROPOSAL 1: APPROVE EQUITY INCENTIVE PLAN AND AMENDMENTS
_____________________________________________________________________________
The Board of Directors adopted and the shareholder approved
the ACX Technologies, Inc. Equity Incentive Plan (the "Plan") in
August 1992. This Plan, which is designed to align the interests
of participants with the interests of the Company's shareholders,
is being submitted for further shareholder approval in order to
comply with the requirements of Section 162(m) of the Internal
Revenue Code regarding performance-based compensation, so that
certain awards granted under the Plan will be tax deductible to
the Company. Additionally, the Board of Directors has approved
and recommends to shareholders for their approval certain other
amendments to the Plan. The primary purposes of the amendments
are to increase the number of shares of the Company's common
stock available under the Plan for compensation awards and
provide for the granting of incentive stock options which meet
the requirements of Section 422 of the Internal Revenue Code. A
summary of the features of the Plan appears below which is
qualified in its entirety by reference to the terms of the Plan,
a copy of which is attached as Exhibit A to this Proxy Statement.
Administration. The Plan is administered by the
Compensation Committee of the Board of Directors (the
"Committee") which consists entirely of outside directors. The
Committee has the authority to select participants, determine
awards to be made, including the terms and conditions of such
awards, and make such other decisions and interpretations as are
necessary under the Plan.
Participation. Participants in the Plan are those employees
who, in the judgment of the Committee, make significant
contributions to the achievement of long-term corporate economic
objectives. The selection of participants is a discretionary
decision of the Committee and is difficult to quantify.
Approximately 60 persons are eligible to participate in the Plan.
Awards. The Plan, as amended, provides for the granting of:
(1) stock options, including incentive stock options meeting the
requirements of Section 422 of the Internal Revenue Code and
options that do not meet the requirements of Section 422 of the
Internal Revenue Code (non-qualified stock options); (2)
restricted stock; (3) stock purchase rights; (4) stock units
which are valued by reference to the Common Stock of the Company;
and (5) other Common Stock grants. The Plan limits the number of
shares that may be awarded to any participant to 600,000 shares
per year.
Options granted under the Plan may be purchased by the
participant at a price determined by the Committee, but in no
event less than 100% of the fair market value of the Common Stock
on the date the option is granted. The Committee also determines
the term of the option and any vesting requirements at the time
the option is granted.
Amendment. The Committee may amend the Plan without
shareholder approval where it is not required to satisfy any
statutory or regulatory requirements.
Change of Control. In the event of a change of control, as
defined under the Plan, all stock options shall become
immediately exercisable in full, all restrictions with respect to
outstanding restricted stock awards shall lapse, and all stock
units shall become immediately payable.
Proposed Amendments. The proposed amendments include: (1)
adding incentive stock options, which are intended to meet the
requirements of Section 422 of the Internal Revenue Code, to the
type of awards that may be granted under the Plan; and (2)
increasing the number of shares available under the Plan in order
to ensure that there are sufficient shares available for future
awards. The amendment provides that for each calendar year
beginning with 1997 and ending with 2001, the number of shares
available for awards under the Plan shall be equal to two percent
of the number of shares outstanding on the preceding December 31.
In addition, the available shares shall include: (i) any shares
remaining as of December 31, 1996, (ii) shares that are
forfeited, shares with respect to which an option is not
exercised and shares that are withheld for tax payments, and
(iii) any unused portion of the prior years' two percent limit.
In addition, no more than ten percent of the total number of
shares available for issuance in any calendar year may be granted
for awards other than options and no more than one million shares
may be granted with respect to incentive stock options. If the
amendment is approved, 558,673 shares will be added in 1997 to
the shares previously authorized.
Federal Income Tax Consequences. The grant of a non-
qualified stock option is not taxable to the participant. If the
option is exercised, the participant will generally recognize
compensation income equal to the difference between the fair
market value of the shares at the time of exercise and the
exercise price of the shares. At the time of exercise, the
Company receives a deduction for an amount equal to the income
recognized by the participant.
Upon the grant and exercise of an incentive stock option, no
taxable income is recognized by the participant and the Company
does not receive a deduction. In order to receive this favorable
tax treatment, the participant must hold the shares for at least
two years after the incentive stock option was granted and for at
least one year after the option is exercised. In addition, the
participant must generally treat the excess of the fair market
value of the shares, on the date of exercise, over the exercise
price as an item of tax preference for purposes of the
alternative minimum tax. The participant will recognize capital
gain income at the time the shares are sold in an amount equal to
the difference between the sale price and the participant's basis
in the shares, which is generally the exercise price. If the
holding period requirements are not met, the difference between
the exercise price and the fair market value of the stock at the
time of exercise (limited to the gain on sale) is compensation
income to the participant and the Company will be allowed a
deduction equal to this taxable income amount. Any gain in
excess of such amount will be long term or short term capital
gain, depending on the participant's holding period.
The closing sale price of the Company's Common Stock, as
quoted on The New York Stock Exchange at the close of business on
March 25, 1997 was $19.375 per share.
The Board of Directors recommends a vote "FOR" this proposal.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
_____________________________________________________________________________
The following table lists beneficial ownership of Common
Stock as of March 26, 1997 by owners of more than five percent of
the Common Stock, each director and executive officer, and all
directors and executive officers as a group:
_______________________________________________________________________________
Address Amount and Nature Percent
Name for 5% Owners of Beneficial Ownership of Class
(1)
_______________________________________________________________________________
Jeffrey H. Coors (2)(3) ACX Technologies, Inc. 13,564,849 48.5%
16000 Table Mountain Pkwy.
Golden, Colorado 80403
William K. Coors (2)(4) Adolph Coors Company 13,172,795 47.1%
Golden, Colorado 80401
Joseph Coors, Jr.(2)(5) ACX Technologies, Inc. 12,480,259 44.6%
16000 Table Mountain Pkwy.
Golden, Colorado 80403
John D. Beckett (2)(6) 17,939 *
John K. Coors (2)(7) 40,861 *
Richard P. Godwin (2)(8) 10,616 *
John H. Mullin, III (2)(9) 23,364 *
John Hoyt Stookey (2)(10) 9,346 *
Jed J. Burnham (2)(11) 67,822 *
Gail A. Constancio (2)(12) 10,389 *
David H. Hofmann (2)(13) 82,858 *
Jill B. W. Sisson (2)(14) 35,191 *
Directors and Executive Officers as a Group
(12 persons) 14,451,025 51.7%
Peter H. Coors (15) Adolph Coors Company 13,059,610 46.7%
Golden, Colorado 80401
Joseph Coors (2)(16) Adolph Coors Company 12,196,099 43.6%
Golden, Colorado 80401
_______________________________________________________________________________
* Holds less than 1% of the Common Stock.
(1) Except as otherwise indicated, the beneficial owner has
sole voting and investment power.
(2) Includes shares of Common Stock issuable pursuant to
options which are currently exercisable or will be exercisable
within 60 days.
(3) Includes 178,064 shares held by Jeffrey H. Coors as
trustee, as to which he shares voting and investment power
with William K. Coors, Joseph Coors and Peter H. Coors, as co-
trustees. Also includes 12,014,728 shares held by Jeffrey H.
Coors as trustee, of which an aggregate of 8,688,668 shares
are owned by Adolph Coors, Jr. Trust, Grover C. Coors Trust,
May Kistler Coors Trust and Herman F. Coors Trust. Each of
the named trusts is record owner of more than five percent of
the Company's Common Stock, ranging between approximately 5.1
percent to 10.0 percent. Of the 12,014,728 shares, Jeffrey H.
Coors shares voting and investment power with Joseph Coors,
Joseph Coors, Jr., Peter H. Coors and William K. Coors, as co-
trustees of these shares. Also includes 857,744 shares owned
by the Adolph Coors Foundation, of which Jeffrey H. Coors,
Peter H. Coors and William K. Coors, among others, are the
directors. Does not include: 50,811 shares of Common Stock
restricted and unissued until the earlier of (i) grantee's
death, disability or termination of employment, or (ii) the
year 2000 (5,726 shares), 2001 (3,600 shares), 2002 (5,344
shares), and 2010 (12,618 shares); or 66,672 shares of Common
Stock restricted and unissued until retirement; or 209,420
shares of Common Stock issuable pursuant to options which are
not currently exercisable or exercisable within 60 days.
(4) Includes 178,064 shares held by William K. Coors as
trustee, as to which he shares voting and investment power
with Jeffrey H. Coors, Joseph Coors and Peter H. Coors, as co-
trustees. Also includes 12,014,728 shares held by William K.
Coors as trustee, of which an aggregate of 8,688,668 shares
are owned by Adolph Coors, Jr. Trust, Grover C. Coors Trust,
May Kistler Coors Trust and Herman F. Coors Trust. Each of
the named trusts is record owner of more than five percent of
the Company's Common Stock, ranging between approximately 5.1
percent to 10.0 percent. Of the 12,014,728 shares, William K.
Coors shares voting and investment power with Jeffrey H.
Coors, Joseph Coors, Joseph Coors, Jr. and Peter H. Coors, as
co-trustees of these shares. Also includes 857,744 shares
owned by the Adolph Coors Foundation, of which Jeffrey H.
Coors, Peter H. Coors and William K. Coors, among others, are
the directors. Does not include 667 shares of Common Stock
issuable pursuant to options which are not currently
exercisable or exercisable within 60 days.
(5) Includes 12,014,728 shares held by Joseph Coors, Jr. as
trustee, of which an aggregate of 8,688,668 shares are owned
by Adolph Coors, Jr. Trust, Grover C. Coors Trust, May Kistler
Coors Trust and Herman F. Coors Trust. Each of the named
trusts is record owner of more than five percent of the
Company's Common Stock, ranging between approximately 5.1
percent to 10.0 percent. Of the 12,014,728 shares, Joseph
Coors, Jr. shares voting and investment power with Jeffrey H.
Coors, Joseph Coors, Peter H. Coors and William K. Coors, as
co-trustees of these shares. Does not include 1,798 shares of
Common Stock restricted and unissued until the earlier of
retirement or death, disability or termination of employment;
or 64,032 shares of Common Stock restricted and unissued until
retirement; or 236,600 shares of Common Stock issuable
pursuant to options which are not currently exercisable or
exercisable within 60 days.
(6) Does not include 667 shares of Common Stock issuable
pursuant to options which are not currently exercisable or
exercisable within 60 days.
(7) Does not include 18,156 shares of Common Stock restricted
and unissued until retirement; or 13,467 shares of Common
Stock issuable pursuant to options which are not currently
exercisable or exercisable within 60 days.
(8) Includes 3,072 shares held by Richard P. Godwin as
trustee, as to which he shares voting and investment power
with Reatha T. Godwin, as co-trustee. Does not include 2,000
shares of Common Stock issuable pursuant to options which are
not currently exercisable or exercisable within 60 days.
(9) Includes 2,132 shares held by John H. Mullin, III as a co-
general partner of a partnership, as to which he shares voting
and investment power. Also includes 868 shares held by John
H. Mullin, Jr. Trust, as to which he shares voting and
investment power. Does not include 1,334 shares of Common
Stock issuable pursuant to options which are not currently
exercisable or exercisable within 60 days.
(10) Does not include 2,000 shares of Common Stock issuable
pursuant to options which are not currently exercisable or
exercisable within 60 days.
(11) Does not include 33,168 shares of Common Stock issuable
pursuant to options which are not currently exercisable or
exercisable within 60 days.
(12) Does not include 6,089 shares which are restricted and
unissued until the earlier of retirement or death, disability
or termination of employment. Also does not include 27,062
shares of Common Stock issuable pursuant to options which are
not currently exercisable or exercisable within 60 days.
(13) Does not include: 10,740 shares of Common Stock
restricted and unissued until the earlier of (i) grantee's
death, disability or termination of employment, or (ii) the
year 1998 (5,382 shares), and 1999 (5,358 shares); 52,972
shares of Common Stock restricted and unissued until
retirement; or 92,641 shares of Common Stock issuable pursuant
to options which are not currently exercisable or exercisable
within 60 days.
(14) Does not include 7,748 shares of Common Stock restricted
and unissued until the earlier of (i) grantee's death,
disability or termination of employment, or (ii) the year 2008
(582 shares), and 2009 (6,584 shares). Also does not include
30,293 shares of Common Stock issuable pursuant to options
which are not currently exercisable or exercisable within 60
days.
(15) Peter H. Coors is not a director or officer of the
Company. His ownership includes 178,064 shares held by Peter
H. Coors as trustee, as to which he shares voting and
investment power with Jeffrey H. Coors, Joseph Coors and
William K. Coors, as co-trustees. Also includes 12,014,728
shares held by Peter H. Coors as trustee, of which an
aggregate of 8,688,668 shares are owned by Adolph Coors, Jr.
Trust, Grover C. Coors Trust, May Kistler Coors Trust and
Herman F. Coors Trust. Each of the named trusts is record
owner of more than five percent of the Company's Common Stock,
ranging between approximately 5.1 percent to 10.0 percent. Of
the 12,014,728 shares, Peter H. Coors shares voting and
investment power with Jeffrey H. Coors, Joseph Coors, Joseph
Coors, Jr., and William K. Coors, as co-trustees of these
shares. Also includes 857,744 shares owned by the Adolph
Coors Foundation, of which Jeffrey H. Coors, Peter H. Coors
and William K. Coors, among others, are the directors.
(16) Joseph Coors was a director of the Company until August
1996 when he retired and was named Director Emeritus. His
ownership Includes 250,000 shares held by Joseph Coors as co-
trustee of his revocable trust. Also includes 178,064 shares
held by him as trustee as to which he shares voting and
investment power with Jeffrey H. Coors, Peter H. Coors and
William K. Coors, as co-trustees. Also includes 11,764,728
shares held by Joseph Coors as trustee, of which an aggregate
of 8,688,668 shares are owned by Adolph Coors, Jr. Trust,
Grover C. Coors Trust, May Kistler Coors Trust and Herman F.
Coors Trust. Each of the named trusts is record owner of more
than five percent of the Company's Common Stock, ranging
between approximately 5.1 percent to 10.0 percent. Of the
11,764,728 shares, Joseph Coors shares voting and investment
power with Jeffrey H. Coors, Joseph Coors, Jr., Peter H. Coors
and William K. Coors, as co-trustees of these shares. Does
not include 667 shares of Common Stock issuable pursuant to
options which are not currently exercisable or exercisable
within 60 days.
Jeffrey H. Coors, Joseph Coors, Joseph Coors, Jr. Peter H. Coors and
William K. Coors may constitute a control group of the Company, beneficially
owning in the aggregate approximately 51 percent of the Common Stock.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
_____________________________________________________________________________
The Compensation Committee (the "Committee") of the Board of
Directors, which is composed entirely of independent directors,
is responsible for all compensation matters regarding the
Company's executive officers and for administering and granting
awards under all executive compensation plans in which executive
officers participate. The current members of the Committee are
John H. Mullin, III, who serves as Chairman, and John Hoyt
Stookey.
Compensation Policies
General. The Company's compensation policies are intended
to create value for the Company's shareholders through long-term
growth in sales and earnings. The total compensation package,
consisting of salary, benefits, an annual incentive opportunity
and equity grants, is designed to attract, motivate and retain
the quality of executives needed to successfully lead and manage
the Company. This package intentionally ties a sizable portion
of the executives' total compensation to Company performance and
shareholder value. To further the focus of its executives on
shareholder value, the Committee established guidelines for
minimum levels of stock ownership by the executive officers.
Within a period of five years, the executive officers are to own
stock equal in value to the following multiples of salary:
members of the Office of the President - 3 times and the other
executive officers - 1 time. Guidelines are encouraged, not
mandatory, and have no impact on salary increases or
participation in the annual incentive plan. However, the
Committee annually reviews each executive officer's progress
toward achieving the ownership goal, and if progress is
unsatisfactory, future equity grants may be reduced or
eliminated.
Salary. Salary range midpoints are targeted to be at the
median (the 50th percentile) of salaries paid by similar-sized
manufacturing companies as determined from data in national
salary surveys, a larger group of manufacturing companies than
those in the performance graph index. For 1996, the salary data
taken from the surveys was based on several hundred manufacturing
companies. Through a regression analysis formula, the salary
data is adjusted to reflect companies with the same sales revenue
as that of the Company. An executive officer is paid within the
salary range depending upon the individual's level of experience,
expertise and specific job performance. Salaries are reviewed
annually and any increases are approved by taking into account
the Company's actual financial performance, the executive
officer's performance in meeting Company goals and competitive
salary data. The Committee does not assign a predetermined
specific weight to these items.
Annual Incentive. The annual incentive is variable
compensation and depends 100 percent upon Company performance.
The 1996 incentive plan provided for targeted cash bonuses equal
to 50 percent of base salary if certain predetermined financial
goals were achieved. These financial goals included an earnings
per share ("EPS") goal for ACX executive officers and an earnings
before interest and taxes ("EBIT") goal for the Company's
subsidiary executive officers. The goals were set by the
Committee in February 1996 and included a "threshold" level below
which no bonus would be earned. Potential awards are uncapped
and may exceed 100 percent of salary. For the ACX executive
officers, the Committee modified the potential award payments in
March 1996 by basing them on 75 percent of an executive officer's
salary, rather than 100 percent, and allocating the remaining 25
percent to a discretionary bonus based on the results of actions
taken in regards to Golden Aluminum Company during 1996. For
1996, the Committee certified that the EPS goal was achieved at
the 107 percent level; and therefore, cash bonuses paid to ACX
executive officers equaled 80 percent of base salary under the
EPS goal. ACX executive officers also received a bonus of 15
percent of base salary under the discretionary goal. The
Committee also certified that the EBIT goal for Graphic Packaging
was achieved at the 71.5 percent level and, therefore, a cash
bonus of 71.5 percent of salary was paid to David H. Hofmann,
president of GPC.
Executive officers may elect to defer up to 100 percent of
the annual bonus. Amounts deferred are deemed to be invested, at
the executive officer's election, in either a fixed rate fund or
in a stock units fund, provided the bonus is deferred for a
minimum of two years. Bonuses deemed invested in the fixed rate
fund earn simple interest during the deferral period equal to the
average rate for 10-year Treasury notes plus two points. The
bonus plus accrued interest is paid in cash at the end of the
deferral period. Bonuses deemed invested in the stock units fund
are denominated as a specific number of shares of Common Stock by
using the market value of these shares at the time of the
investment divided by the amount of the bonus invested in stock
units. In addition, the holder of stock units receives one non-
qualified stock option for each two stock units taken in place of
the cash bonus. The options vest ratably over two years and have
a 10-year term. This provision is designed to further encourage
stock ownership by the executives. The stock units are paid by
issuing an equal number of shares of Common Stock at the end of
the deferral period.
Equity Grants. Equity grants are variable compensation and
tied 100 percent to the future performance of the Company's
Common Stock. The Company's equity plan currently allows for
equity grants of non-qualified stock options, restricted shares,
stock units and bonus shares. During 1996, the Committee granted
stock options and stock units at 100 percent of the market price
of the Company's Common Stock on the date of grant. The
Committee: (a) made the annual stock option grant as provided for
in the Executive Incentive Plan; and (b) granted stock units and
stock options to those executive officers who elected to defer
their bonus and invest it in the stock units fund. The number of
shares for the annual option grant was calculated so that the
value of the options granted, using an option pricing model, was
equal to 60 percent of the executive officers' salaries and 100
percent of the president of GPC's salary. The members of the
Office of the President did not participate in the annual option
grant for 1996 because of the accelerated option grant made to
them in 1994.
Chief Executive Officer Compensation
Two members served in the Office of the President and shared
the chief executive officer function during 1996. Each year the
Office of the President evaluates its performance against the
following four strategic goals approved by the Committee:
leadership, creation of earnings, growth and innovation. The
Committee considers this self-evaluation at the time it does its
own evaluation of the Office of the President's performance.
Salaries for the two members are targeted, in total, to be
no greater than the combined median (the 50th percentile)
salaries of the top two executives in similar-sized manufacturing
companies. The Committee recommended and the Board approved a 7
percent salary increase for 1996 after considering competitive
salary data as described above and the Company's 1995
performance, including: (1) increasing sales by 25 percent
through new product development; (2) increasing net income per
share by 15 percent; (3) strengthening management teams at each
of the businesses; and (4) on-going review and actions taken with
regard to the under-performing assets of the Company.
Each member of the Office of the President participated in
the annual incentive opportunity described above and earned a
bonus for 1996 at the level of 80 percent of salary for the EPS
goal and 15 percent of salary for the discretionary goal. Under
the EPS goal, the target bonus opportunity for each member was
37.5 percent of salary.
Because of the accelerated grant of stock options made in
1994, no options were granted to either member during 1996 except
for those granted upon the deferral of a bonus which was invested
in stock units as described above.
Tax Deductibility of Executive Compensation
Section 162(m) of the Internal Revenue Code generally limits
the Company's tax deduction for compensation paid to the
executive officers named in the Summary Compensation Table, which
follows this report, to $1 million unless certain requirements
are met.
The Committee has taken and intends to continue taking the
necessary steps to ensure that the Company's tax deduction is
preserved and not limited by the $1 million deductibility cap.
In particular, the Committee sought and obtained shareholder
approval for the Company's Executive Incentive Plan and is
seeking approval for its Equity Incentive Plan, as required under
Section 162(m).
This report is submitted by the Compensation Committee of the
Board of Directors:
JOHN H. MULLIN, III, Chairman
JOHN HOYT STOOKEY
EXECUTIVE COMPENSATION
_____________________________________________________________________________
Summary Compensation Table
____________________________________________________________________________
Long-Term Compensation
___________________________
Annual Compensation Awards Payouts
______________________ _______________ _________
Other Securities All Other
Annual Restricted Underlying Compen-
Name and Compensa- Stock Options/ LTIP sation
Principal Year Salary Bonus tion Award(s) SARs Payouts ($)
Position ($) ($)(1) ($)(2) ($) (#) ($)(3) (4)
_____________________________________________________________________________
Jeffrey H. 1996 $460,000 $437,460 $ 7,780
Coors
Office of 1995 $430,000 $430,000 $48,633 2,672 $ 6,968
the President
1994 $390,004 $265,600 (5) 335,136 $ 4,903
______________________________________________________________________________
Joseph 1996 $460,000 $437,460 $ 8,408
Coors, Jr.
Office of 1995 $430,000 $430,000 $ 2,795 $ 6,518
the President
1994 $390,004 $265,600 $14,873 (5) 332,016 $ 7,167
________________________________________________________________________________
David H. 1996 $354,996 $254,003 $200,000 (6) 62,079 $209,250 $18,364
Hofmann
President, 1995 $330,000 $247,500 35,290 $249,324 $10,450
Graphic 1994 $300,084 $225,063 (5) 28,044 $318,205 $ 8,575
Packaging Corporation
________________________________________________________________________________
Jed J. 1996 $185,008 $175,935 14,600 $ 3,750
Burnham
Chief 1995 $166,668 $166,668 10,400 $ 3,750
Financial 1994 $138,004 $ 94,618 6,000 $ 3,453
Officer
and
Treasurer
________________________________________________________________________________
Jill B.W. 1996 $162,004 $154,062 14,734 $ 3,750
Sisson 1995 $150,004 $150,000 8,900 $ 3,475
General 1994 $138,004 $ 94,618 6,582 $ 3,453
Counsel and Secretary
________________________________________________________________________________
Gail A. 1996 $118,804 $112,979 11,592 $ 2,698
Constancio 1995 $108,004 $108,000 11,560 $ 2,430
Controller 1994 $ 79,311 $ 46,201 $ 1,918
________________________________________________________________________________
(1) Bonuses shown are the total bonuses for 1996 and are paid
100 percent in cash except where executives elect to defer a
portion of the bonus into either the fixed rate fund or the
stock units fund as described above in the Committee's
Report.
(2) Perquisites and other personal benefits do not exceed the
lesser of either $50,000 or 10 percent of the total annual
salary and bonus reported for the named executive officers.
Amounts shown are reimbursements during the year for taxes.
(3) LTIP payout amounts represent bonuses paid under a
subsidiary long-term incentive plan (Graphic Packaging)
which provided for cash bonuses based on predetermined 3-
year financial goals. This plan was discontinued in 1995
when there were 3 cycles remaining under the plan: 1993 to
1995, 1994 to 1996 and 1995 to 1997. Bonuses were
calculated in 1995 based on estimated performance in the
remaining years, 1995 to 1997, and prorated accordingly.
That is, for 1995, 100% of the bonus was paid; for 1996, 67%
of the bonus was paid; and for 1997, 33% of the bonus will
be paid. GPC officers must be employed at the end of the
performance cycles in order to receive the prorated amounts.
(4) Other compensation includes the value of term life insurance
benefiting the executive and the employer's contribution to
the 401-K plan, respectively, as follows: Jeffrey H. Coors
- $4,030 and $3,750; Joseph Coors, Jr. - $4,658 and $3,750;
David H. Hofmann - $14,614 and $3,750; Jed J. Burnham - $0
and $3,750; Jill B. W. Sisson - $0 and $3,750; and Gail A.
Constancio - $0 and $2,698.
(5) Stock units were granted on October 1, 1994 in an amount
approximately equal to the Company's liability as of January
1, 1994 for the benefit due the named executives under
salary continuation agreements. These stock units do not
represent additional compensation in 1994, nor were the
amounts paid or payable in 1994. The stock units replace a
cash liability of the Company and tie the named executive's
post-retirement benefit to stock value. The stock units are
payable in full upon retirement at age 60 or after. The
stock units are 50 percent vested at age 50 with 10 years of
service and the remaining 50 percent vests in 5 percent
increments between ages 51 and 60. The number of stock
units granted, the percent vested at year end 1996 and the
market value at year end 1996, respectively, were: Jeffrey
H. Coors - 66,672 units, 55 percent vested, valued at
$1,320,939; Joseph Coors, Jr. - 64,032 units, 70 percent
vested, valued at $1,268,634; and David H. Hofmann - 52,972
units, 63 percent vested, valued at $1,049,508.
(6) Restricted stock (12,800 shares) was granted on January 1,
1996 at the fair market value of the Company's common stock
on that date. The shares vest ratably over 3 years from the
grant date. Mr. Hofmann, as holder of record of this stock,
is eligible for dividend payments in the event the Company
were to make such payments.
Option/SAR Grants in Last Fiscal Year
_____________________________________________________________________________
Individual Grants (1)
_____________________________________________________________________________
Number of % of Total
Securities Options/
Underlying SARs Exercise Grant Date
Options/ Granted to or Base Present
SARs Granted Employees Price Expiration Value ($)
Name (#) in Fiscal Yr. ($/Sh) Date (2)
____________________________________________________________________________
David H. Hofmann 46,600 (3) $14.875 13-Feb-06 $366,276
2,679 (4) $16.875 1-Mar-06 $23,897
_______
49,279 10.4%
Jed J. Burnham 14,600 (3) 3.1% $14.875 13-Feb-06 $114,756
Jill B. W. Sisson 12,800 (3) $14.875 13-Feb-06 $100,608
1,934 (4) $16.875 1-Mar-06 $17,251
______
14,734 3.1%
Gail A. Constancio 9,400 (3) $14.875 13-Feb-06 $73,884
2,192 (4) $16.875 1-Mar-06 $19,553
______
11,592 2.4%
_____________________________________________________________________________
(1) All options are granted at the Common Stock's market value
on the grant date, and each grant has an expiration date as
specified in the table. All options vest in the event of a
change in control. The option price may be paid in cash, by
surrendering shares owned for more than 6 months, or through
irrevocable instructions to a broker to deduct the option
price from the proceeds of the sale. Options include the
right to have shares withheld by the Company to pay
withholding tax obligations due in connection with the
exercise.
(2) Values indicated are an estimate based on the Black-Scholes
option pricing model using the following assumptions: (a)
22.6 percent stock price volatility based on the average
stock price volatility of the companies included in the S&P
Manufacturing (Diversified/Industrials) Index; (b) 6.76
percent risk-free rate of return; (c) zero dividend yield;
(d) anticipated exercising at the end of the option term;
and (e) no adjustment for non-transferability or risk of
forfeiture. The actual value realized will be determined by
the excess of the stock price over the exercise price on the
date the option is exercised. There is no certainty the
actual value realized will be at or near the value estimated
by the Black-Scholes option pricing model.
(3) An annual grant which vests ratably over 3 years with each
vested increment being exercisable until the tenth
anniversary of the grant date.
(4) Options granted as a result of an election to defer the 1995
cash bonus by investing it in stock units. Options vest
ratably over 2 years with each vested increment being
exercisable until the tenth anniversary of the grant date.
Any unvested options are subject to forfeiture if the
underlying bonus shares are not retained for 2 years.
Aggregated Option/SAR Exercises in Last Fiscal Year and FY-End
Option/SAR Values
____________________________________________________________________________
Number of Securities
Underlying Unexer- Value of Unexercised
cised Options/SARs In-The-Money Options/SARs
Shares at 12/31/96 (#) at 12/31/96 ($) (1)
Acquired On Value ____________ ________ ________________________
Exercise Realized Exercis- Unexer- Exercis- Unexer-
NAME (#) ($) able cisable able cisable
_____________________________________________________________________________
Jeffrey H. Coors 420,236 227,464 $2,301,923 $473,169
Joseph Coors, Jr. 405,944 226,128 $2,274,521 $472,584
David H. Hofmann 51,517 72,358 $ 188,520 $248,054
Jed J. Burnham 39,340 35,492 $ 206,807 $146,176
Jill B. W. Sisson 19,694 28,050 $ 86,518 $102,255
Gail A.Constancio 3,423 19,729 $ 1,498 $ 56,411
_____________________________________________________________________________
(1) Value of unexercised options equals market value of the
shares ($19.8125) underlying in-the-money options at
December 31, 1996, less the exercise price, times the number
of in-the-money options outstanding.
Pension Plan Table
The estimated total annual retirement benefits payable under
the defined benefit plan in which the named executives
participate are set forth in the table below. The table
illustrates benefits accrued through fiscal year 1996 and
includes years of service and compensation earned while employed
by ACCo, the former parent of ACX. In connection with the Spin-
Off, ACX assumed the pension liability for the ACCo former
employees who transferred to ACX as part of the Spin-Off and ACX
received the funding associated with that liability.
____________________________________________________________________________
Years of Service
Remuneration 15 20 25 30 35
_____________________________________________________________________________
$125,000 $ 32,813 $ 43,750 $ 54,688 $ 65,625 $ 68,750
$150,000 $ 39,375 $ 52,500 $ 65,625 $ 78,750 $ 82,500
$175,000 $ 45,938 $ 61,250 $ 76,563 $ 91,875 $ 96,250
$200,000 $ 52,500 $ 70,000 $ 87,500 $105,000 $110,000
$225,000 $ 59,063 $ 78,750 $ 98,438 $118,125 $123,750
$250,000 $ 65,625 $ 87,500 $109,375 $131,250 $137,500
$275,000 $ 72,188 $ 96,250 $120,313 $144,375 $151,250
$300,000 $ 78,750 $105,000 $131,250 $157,500 $165,000
$325,000 $ 85,313 $113,750 $142,188 $170,625 $178,750
$350,000 $ 91,875 $122,500 $153,125 $183,750 $192,500
$375,000 $ 98,438 $131,250 $164,063 $196,875 $206,250
$400,000 $105,000 $140,000 $175,000 $210,000 $220,000
$425,000 $111,563 $148,750 $185,938 $223,125 $233,750
$450,000 $118,125 $157,500 $196,875 $236,250 $247,500
_____________________________________________________________________________
(1) Maximum permissible benefit under ERISA from the qualified
Retirement Plan is $90,000 (which is increased by cost of
living adjustments annually). After January 1, 1989, annual
compensation in excess of $200,000 (which is also increased
by cost of living adjustments annually) is not considered
for benefits under the qualified plan. Also, for service
after January 1, 1994, annual compensation in excess of
$150,000 (which is also increased by cost of living
adjustments) is not considered for benefits under the
qualified plan. The benefit is computed on the basis of a
straight-life annuity and is not subject to any deduction
for Social Security or other offset amounts. The Company
has a non-qualified supplemental retirement plan to provide
full accrued benefits to all employees. The payments shown
in the table include the payments under the supplemental
retirement plan.
(2) The compensation covered by the Retirement Plan is salary
only and does not include any of the other compensation
items shown on the summary compensation table. The salary
used to compute benefits is the average of the three highest
salary amounts in the last ten years. As of fiscal year-end
1996, average annual compensation covered by the Retirement
Plan and credited years of service with ACX, including
previous compensation and years of service with ACCo and its
subsidiaries, for the named executives are as follows:
Jeffrey H. Coors - $424,476 and 25 years; Joseph Coors, Jr.
- $423,515 and 20 years; David H. Hofmann - $328,360 and 7
years; Jed J. Burnham - $161,699 and 4 years; Jill B. W.
Sisson - $149,115 and 4 years; and Gail A. Constancio -
$96,372 and 10 years.
Employment Contracts and Termination of Employment and Change-in-Control
Arrangements
The Company has no employment contracts with the named
executives. Compensation received by the named executives upon
retirement includes normal retirement benefits and, for the two
members of the Office of the President and the president of
Graphic Packaging, a number of shares of stock to be granted
under the salary continuation agreements described above in
footnote 5 to the Summary Compensation Table. In addition, in
the case of a change in control of the Company, the Company's
compensation plans will be affected as follows: (1) under the
Equity Incentive Plan, all outstanding options will become
exercisable in full and all stock units will become payable in
full; (2) under the Executive Incentive Plan (the annual
incentive plan), the plan will terminate and prorated bonuses
will be calculated and paid, if earned; (3) under the deferred
compensation plan, distributions of deferred amounts will be made
in a lump sum within 90 days after the change in control; and (4)
under the salary continuation agreements, stock units vest 100
percent without regard to the executive's age or service. The
definition of change in control for these purposes is as follows:
(i) The acquisition of, or the ownership of, 50 percent or more
of the total Common Stock of the Company then issued and
outstanding, by any person, or group of affiliated persons, or
entities not affiliated with the Company as of the effective
dates of these plans, without the consent of the Board of
Directors, or (ii) The election of individuals constituting a
majority of the Board of Directors who were not either (A)
members of the Board of Directors prior to the election or (B)
recommended to the shareholders by management of the Company, or
(iii) A legally binding and final vote of the shareholders of the
Company in favor of selling all or substantially all of the
assets of the Company.
Compensation Committee Interlocks and Insider Participation
During 1996, the following individuals served on the
Compensation Committee: John H. Mullin, III, John Hoyt Stookey
and, until May 1996, William K. Coors. There were no
compensation committee interlocks during 1996 even though Mr.
Coors is the Chairman of the Board and President of ACCo. The
Company and ACCo are parties to certain operating and other
agreements described in "CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS."
Performance Graph
The following performance graph compares the performance of
the Company's Common Stock to the Standard & Poor's 500 Stock
Index and to the Standard & Poor's Manufacturing
(Diversified/Industrials) Index for the period from December 10,
1992 (the commencement of trading on a "when-issued basis" in the
Company's Common Stock) through December 31, 1996. The graph
assumes that the value of the investment in the Company's Common
Stock and each index was $100 at December 10, 1992 and that all
dividends, if any, were reinvested, although it should be noted
that the Company has not paid dividends on its Common Stock. The
information contained in this graph is not necessarily indicative
of future Company performance.
Comparison of Cumulative Total Returns
Since Commencement of Trading in Company Common Stock
[GRAPH APPEARS HERE]
_______________________________________________________________
12/10/92 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96
______________________________________________________________________________
S&P 500 $100 $101 $111 $112 $154 $194
S&P
Manufacturing $100 $103 $125 $129 $182 $247
(Diversified)
ACX $100 $139 $256 $254 $194 $251
Technologies,Inc.
______________________________________________________________________________
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
______________________________________________________________________________
Joseph Coors, William K. Coors, Joseph Coors, Jr., Jeffrey
H. Coors and Peter H. Coors are co-trustees of one or more of the
family trusts which collectively own approximately 46.7
percent of the Common Stock of the Company and a majority of the
non-voting common stock of ACCo. In addition, one of those
trusts owns 100 percent of the voting common stock of ACCo.
Peter H. Coors is a brother of Jeffrey H. Coors, John K. Coors
and Joseph Coors, Jr. and son of Joseph Coors and is a director
and executive officer of ACCo and Coors Brewing. Joseph Coors
and William K. Coors are brothers and directors of ACCo. ACX and
ACCo, or their subsidiaries, have certain business relationships
and have engaged or propose to engage in certain transactions
with one another, as described below.
Transactions with Adolph Coors Company
In connection with the 1992 Spin-Off, certain ACX
subsidiaries entered into market-based, long-term supply
agreements with Coors Brewing to provide packaging, aluminum and
starch products to Coors Brewing for use in its business.
Under the original packaging supply agreement, Coors Brewing
agreed to purchase and Graphic Packaging agreed to supply
substantially all of Coors Brewing's paperboard and label
packaging requirements through 1997. In early 1997, this
agreement was modified and extended to a three year, rolling term
contract. The aluminum supply agreement was cancelled in 1995
and ACX and ACCo entered into two successive one year contracts
for 1995 and 1996. Since late 1994, American National Can
("ANC") has acted as purchasing agent with GAC for certain joint
operations between CBC and ANC. ANC ordered tabstock from Golden
Aluminum in 1996 and limited quantities of bodystock. ACX sold
the aluminum business in March 1997. Under the starch supply
agreement which was amended in 1996, Coors Brewing agreed to
purchase and Golden Technologies agreed to sell 100 million
pounds of refined corn starch annually through 1997. In March
1997, the starch supply agreement was extended through 1999.
Total sales under these supply contracts are a material source
of revenue for the Company, accounting for sales of approximately
$145,000,000 in 1996. Sales to CBC of approximately $120,000,000
are estimated for 1997 under the packaging and the starch supply
contracts. Effective upon the sale of GAC to Crown Cork & Seal
in March 1997, GAC is no longer a subsidiary of the Company.
In addition to these supply agreements, Golden Aluminum
purchased aluminum scrap from Coors Brewing's can making
operations in the amount of $240,000 in 1996. Also, Coors
Brewing and Golden Technologies are parties to an agreement under
which Golden Technologies purchases brewery by-products and
retains a percentage of the net sales price on the resale of such
by-products. In 1997, the by-products agreement was extended
through 1999. Payments to Coors Brewing under this contract were
approximately $10,000,000 in 1996 and are also
anticipated to be approximately $10,000,000 in 1997.
In addition, certain subsidiaries of ACX and ACCo are
parties to a few miscellaneous market-based transactions. The
Company's real estate brokerage subsidiary has provided real
estate management and other services to Coors Brewing and Coors
Brewing provides water and waste water treatment services for an
ACX ceramics facility located on property leased from Coors
Brewing. In addition, the ceramics subsidiary sold certain
miscellaneous products to CBC, including ceramic can tooling for
Coors Brewing's can lines. During 1996, the Company received approximately
$370,000 for the services and products it provided to ACCo as described in
this paragraph, and, because the sale of certain described
ceramic products and real estate services have been discontinued
in 1997, anticipates it will receive approximately $70,000 for
these services and products in 1997. During 1996, the Company
paid ACCo and its subsidiaries approximately $310,000 for the
services provided by ACCo as described in this paragraph, and
anticipates it will pay approximately $370,000 in 1997 for these
services.
An ACX subsidiary is a general partner in a limited
partnership in which Coors Brewing is the limited partner. The
partnership owns, develops, operates and sells certain real estate
previously owned directly by Coors Brewing or ACCo. Each partner is
obligated to make additional cash contributions of up to $500,000 upon
call of the general partner. Distributions of $1,500,000 were made to
each partner in 1996. Distributions are allocated equally
between the partners until Coors Brewing recovers its investment
and thereafter 80 percent to the general partner and 20 percent
to Coors Brewing. It is estimated that distributions for 1997
will be $1,500,000 to each partner.
Other Transactions
In 1996, the Compensation Committee approved the purchase by
the Company, of David H. Hofmann's residence for its appraised
value of $925,000. The appraised value was determined by
averaging the results of three independent appraisals. The
Company is in the process of consummating the sale of this
property for its appraised value. Also, in connection with this
transaction, the Company paid in 1997 approximately $90,000 in
commissions and selling costs, which includes repair of the
property's septic system for $30,000.
In 1997, the Company agreed to either directly loan or
guarantee a third party line of credit for two years, not to
exceed $8 million, to National Empowerment Television, Inc.
("NET"). NET is a television network based in Washington, D.C.
which offers 24-hour programming in current events. Specific
terms have not yet been agreed to under this guaranty. However,
it has been preliminarily agreed that the loan will be at the
lowest possible interest rate, not to exceed Prime Rate and in
return, the Company will receive the right to purcahse shares of
NET's common stock at a 10 percent discount per share provided
certain conditions are met. If the Company is called upon to
satisfy the guaranty, the Company has the option to convert the
loan into an equity position of NET. Jeffrey H. Coors, an
officer and director of the Company, is a member of the board of
directors of NET and of the Free Congress Foundation ("FCF"), a
substantial shareholder of NET. Mr. Coors is also a trustee of
Castle Rock Foundation which is a shareholder of NET. John D.
Beckett, a director of the Company, beneficially owns shares of
NET and is also a member of the board of directors of FCF. Jed
J. Burnham, an officer of the Company, has agreed to serve, at
the Company's request, as a member of the board of directors of
NET in 1997.
Indebtedness of Management
In December 1996, the Company made a non-interest bearing
loan to David H. Hofmann, an officer of the Company, in the
amount of $200,000. The note is secured by a mortgage on a
parcel of land consisting of 15 acres (the "Property"). The note
is due and payable at the earlier of: (1) five years from its
effective date, and (2) sale of the Property. Any and all sales
proceeds for the Property are to be applied first to repay the
note.
OTHER BUSINESS
_____________________________________________________________________________
The Board of Directors of the Company is not aware of any
other matters that are to be presented at the Annual Meeting.
Nevertheless, if other matters should properly come before the
Annual Meeting, the persons named in the proxy will vote on these
matters in accordance with their judgment.
INFORMATION ON INDEPENDENT ACCOUNTANTS
_____________________________________________________________________________
The Board has unanimously reappointed the firm of Price
Waterhouse LLP ("Price Waterhouse") as independent accountants
for the 1997 fiscal year. A representative of Price Waterhouse
will be present at the Annual Meeting to answer questions from
the shareholders and will be given an opportunity to make a
statement on behalf of Price Waterhouse if he desires.
DIRECTOR AND OFFICER SECURITIES REPORTS
_____________________________________________________________________________
The Company's executive directors and officers, and persons
who own more than 10 percent of the Company's equity securities
are required to file under the Securities Exchange Act of 1934
reports of ownership and changes of ownership with the Securities
and Exchange Commission. Based solely upon information provided
to the Company, the Company believes that during the fiscal year
ended December 31, 1996 all filing requirements applicable to
directors and executive officers, and greater than 10 percent
beneficial owners, have been complied with.
RESOLUTIONS PROPOSED BY INDIVIDUAL SHAREHOLDERS
_____________________________________________________________________________
In order to be considered for inclusion in the Company's
Proxy Statement and form of proxy relating to the Company's next
Annual Meeting of Shareholders following the end of the Company's
1997 fiscal year, proposals by individual shareholders must be
received by the Company no later than December 1, 1997.
AVAILABILITY OF REPORT ON FORM 10-K
____________________________________________________________________________
Upon written request, the Company will provide without
charge a copy of its Annual Report on Form 10-K (without
exhibits) for the fiscal year ended on December 31, 1996, to any
of the Company's shareholders of record at the close of business
on March 26, 1997. Any request for a copy of the Company's
Annual Report on Form 10-K should be mailed to: Shareholder
Relations, ACX Technologies, Inc., 16000 Table Mountain Parkway,
Golden, Colorado 80403.
This Notice and Proxy Statement are sent by order of the
Board of Directors.
Dated: March 31, 1997 _________________________________________
Jill B. W. Sisson, General
Counsel and Secretary
EXHIBIT A
Amended as of May 13, 1997
ACX TECHNOLOGIES, INC.
EQUITY INCENTIVE PLAN
Section 1
Introduction
1.1 Introduction. ACX Technologies, Inc., a Colorado
corporation hereinafter referred to, together with its Affiliated
Corporations (as defined in subsection 2.1(a)) as the "Company"
except where the context otherwise requires, previously
established the ACX Technologies, Inc. Equity Incentive Plan (the
"Plan") for certain key employees of the Company. The Plan,
which permits the grant of stock options and restricted stock
awards to certain key employees of the Company, was effective
August 12, 1992 and was previously amended and restated effective
November 11, 1992, October 20, 1994, February 14, 1995 and
November 14, 1995. Pursuant to the power granted in Section 16,
the Company hereby further amends and restates the Plan in its
entirety, effective May 13, 1997.
1.2 Purposes. The purposes of the Plan are to provide
the key employees selected for participation in the Plan with added
incentives to continue in the service of the Company and to
create in such employees a more direct interest in the future
success of the operations of the Company by relating incentive
compensation to the achievement of long-term corporate economic
objectives, so that the income of the key employees is more
closely aligned with the income of the Company's shareholders.
The Plan is also designed to attract key employees and to retain
and motivate participating employees by providing an opportunity
for investment in the Company.
1.3 Effective Date. The original effective date of the Plan
(the "Effective Date") was August 12, 1992. This Plan, each amendment
to the Plan, and each option or other award granted hereunder is
conditioned on and shall be of no force or effect until approval
of the Plan by the holders of the shares of voting stock of the
Company unless the Company, on the advice of counsel, determines
that shareholder approval is not necessary.
Section 2
Definitions
2.1 Definitions. The following terms shall have the meanings
set forth below:
(a) "Affiliated Corporation" means any corporation or other
entity (including but not limited to a partnership) that is affiliated
with ACX Technologies, Inc. through stock ownership or otherwise
and is treated as a common employer under the provisions of
Sections 414(b) and (c) of the Code, or is a parent or subsidiary
of the Company as defined in Section 424 of the Code.
(b) "Award" means an Option, a Restricted Stock Award
issued hereunder, a grant of Stock made hereunder, an offer to purchase
Stock made hereunder, or Stock Units granted hereunder.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as
it may be amended from time to time.
(e) "Committee" means a committee consisting of members of the
Board who are empowered hereunder to take actions in the administration
of the Plan. The Committee shall be so constituted at all times
as to permit the Plan to comply with Rule 16b-3 or any successor
rule promulgated under the Securities Exchange Act of 1934 (the
"1934 Act") and to permit the Plan to satisfy the requirement of
administration by "outside directors" within the meaning of
Section 162(m) of the Code. Members of the Committee shall be
appointed from time to time by the Board, shall serve at the
pleasure of the Board and may resign at any time upon written
notice to the Board.
(f) "Effective Date" means the original effective date of the
Plan, August 12, 1992.
(g) "Eligible Employees" means those key employees
(including, without limitation, officers and directors who are also
employees) of the Company or any division thereof, upon whose
judgment, initiative and efforts the Company is, or will become,
largely dependent for the successful conduct of their business.
(h) "Fair Market Value" means the average of the highest and
lowest prices of the Stock as reported on the New York Stock Exchange
("NYSE") on a particular date. If there are no Stock transactions
on such date, the Fair Market Value shall be determined as of the
immediately preceding date on which there were Stock
transactions. If the price of the Stock is not reported on NYSE,
the Fair Market Value of the Stock on the particular date shall
be as determined by the Committee using a reference comparable to
the NYSE system. If, upon exercise of an Option, the exercise
price is paid by a broker's transaction as provided in section
7.2(g)(ii)(D), Fair Market Value, for purposes of the exercise,
shall be the price at which the Stock is sold by the broker.
(i) "Incentive Option" means an Option designated as such and
granted in accordance with Section 422 of the Code.
(j) "Non-Qualified Option" means any Option other than an
Incentive Option.
(k) "Option" means a right to purchase Stock at a stated price
for a specified period of time. Options granted under the Plan shall
be either Incentive Options or Non-Qualified Options.
(l) "Option Price" means the price at which shares of Stock
subject to an Option may be purchased, determined in accordance with
subsection 7.2(b) and 7.3(b).
(m) "Participant" means an Eligible Employee designated
by the Committee from time to time during the term of the Plan to
receive one or more of the Awards provided under the Plan.
(n) "Restricted Stock Award" means an award of Stock granted
to a Participant pursuant to Section 8 that is subject to certain
restrictions imposed in accordance with the provisions of such
Section.
(o) "Stock" means the $0.01 par value common stock of the
Company.
(p) "Stock Unit" means a measurement component equal to
the Fair Market Value of one share of Stock on the date for which a
determination is made pursuant to the provisions of this Plan.
2.2 Gender and Number. Except when otherwise indicated
by the context, the masculine gender shall also include the feminine
gender, and the definition of any term herein in the singular
shall also include the plural.
Section 3
Plan Administration
The Plan shall be administered by the Committee. In
accordance with the provisions of the Plan, the Committee shall,
in its sole discretion, select the participants from among the
Eligible Employees, determine the Awards to be made pursuant to
the Plan, the number of Stock Units or shares of Stock to be
issued thereunder and the time at which such Awards are to be
made, fix the Option Price, period and manner in which an Option
becomes exercisable, establish the duration and nature of
Restricted Stock Award restrictions, establish the terms and
conditions applicable to Stock Units, establish the terms and
conditions on which an offer to purchase Stock will be made, and
establish such other terms and requirements of the various
compensation incentives under the Plan as the Committee may deem
necessary or desirable and consistent with the terms of the Plan.
The Committee shall determine the form or forms of the agreements
with Participants that shall evidence the particular provisions,
terms, conditions, rights and duties of the Company and the
Participants with respect to Awards granted pursuant to the Plan,
which provisions need not be identical except as may be provided
herein. The Committee may from time to time adopt such rules and
regulations for carrying out the purposes of the Plan as it may
deem proper and in the best interests of the Company. The
Committee may correct any defect, supply any omission or
reconcile any inconsistency in the Plan or in any agreement
entered into hereunder in the manner and to the extent it shall
deem expedient and it shall be the sole and final judge of such
expediency. No member of the Committee shall be liable for any
action or determination made in good faith. The determinations,
interpretations and other actions of the Committee pursuant to
the provisions of the Plan shall be binding and conclusive for
all purposes and on all persons.
Section 4
Stock Subject to the Plan
4.1 Number of Shares. For each calendar year from and
including the calendar year beginning January 1, 1997 through the
calendar year beginning January 1, 2001 (5 years), a number of
shares of Stock equal to the amount of two percent (2%) of the
total number of issued and outstanding shares of Stock as of
December 31 of the calendar year immediately preceding such year
shall become available for issuance under the Plan. In addition:
(i) any unused portion of the shares of Stock remaining from
those reserved as of December 31, 1996; (ii) any shares of Stock
available pursuant to Section 4.2; and (iii) any unused portion
of the two percent (2%) limit for any calendar year shall be
added to the aggregate number of shares of Stock available for
issuance in each calendar year under the Plan. Out of the total
number of shares of Stock available for issuance in any calendar
year for the grant of Awards, no more than ten percent (10%) of
such shares of Stock may be granted under Awards other than
Options. In no event, except as subject to adjustment as
provided in Sections 4.3 and 4.4, shall more than 1,000,000
shares of Stock be cumulatively available for issuance pursuant
to the exercise of Incentive Options. This authorization may be
increased from time to time by approval of the Board and by the
shareholders of the Company if, in the opinion of counsel for the
Company, shareholder approval is required. Shares of Stock that
may be issued upon exercise of Options, that are issued as
Restricted Stock Awards, that are purchased under the Plan, that
are issued with respect to Stock Units, and that are issued as
incentive compensation under the Plan shall be applied to reduce
the maximum number of shares of Stock remaining available for use
under the Plan. The Company shall at all times during the term of
the Plan and while any Options or Stock Units are outstanding
retain as authorized and unissued Stock at least the number of
shares from time to time required under the provisions of the
Plan, or otherwise assure itself of its ability to perform its
obligations hereunder.
4.2 Other Shares of Stock. Any shares of Stock that are
subject to an Option that expires or for any reason is terminated
unexercised, any shares of Stock that are subject to an Award (other
than an Option) and that are forfeited and any shares of Stock withheld
for the payment of taxes or received by the Company as payment of
the exercise price of an Option, shall automatically become
available for use under the Plan.
4.3 Adjustments for Stock Split, Stock Dividend, Etc.
If the Company shall at any time increase or decrease the
number of its outstanding shares of Stock or change in any way
the rights and privileges of such shares by means of the payment
of a stock dividend or any other distribution upon such shares
payable in Stock, or through a stock split, subdivision,
consolidation, combination, reclassification or recapitalization
involving the Stock, then in relation to the Stock that is affected by one
or more of the above events, the numbers, rights and privileges of
the following shall be increased, decreased or changed in like
manner as if they had been issued and outstanding, fully paid and
nonassessable at the time of such occurrence: (i) the shares of
Stock as to which Awards may be granted under the Plan and (ii)
the shares of the Stock then included in each outstanding Award
granted hereunder.
4.4 Other Distributions and Changes in the Stock. If
(a) the Company shall at any time distribute with
respect to the Stock assets or securities of persons other than
the Company (excluding cash or distributions referred to in Section 4.3),
(b) the Company shall at any time grant to the
holders of its Stock rights to subscribe pro rata for additional
shares thereof or for any other securities of the Company, or
(c) there shall be any other change (except as
described in Section 4.3), in the number or kind of outstanding
shares of Stock or of any stock or other securities into which
the Stock shall be changed or for which it shall have been
exchanged,
and if the Committee shall in its discretion determine that the
event described in subsection (a), (b), or (c) above equitably
requires an adjustment in the number or kind of shares subject to
an Option or other Award, an adjustment in the Option Price or
the taking of any other action by the Committee, including
without limitation, the setting aside of any property for
delivery to the Participant upon the exercise of an Option or the
full vesting of an Award, then such adjustments shall be made, or
other action shall be taken, by the Committee and shall be
effective for all purposes of the Plan and on each outstanding
Option or Award that involves the particular type of stock for
which a change was effected. Notwithstanding the foregoing
provisions of this Section 4.4, pursuant to Section 8.3 below, a
Participant holding Stock received as a Restricted Stock Award
shall have the right to receive all amounts, including cash and
property of any kind, distributed with respect to the Stock upon
the Participant's becoming a holder of record of the Stock.
4.5 General Adjustment Rules. No adjustment or substitution
provided for in this Section 4 shall require the Company to sell a
fractional share of Stock under any Option, or otherwise issue a
fractional share of Stock, and the total substitution or
adjustment with respect to each Option and other Award shall be
limited by deleting any fractional share. In the case of any
such substitution or adjustment, the total Option Price for the
shares of Stock then subject to the Option shall remain unchanged
but the Option Price per share under each such Option shall be
equitably adjusted by the Committee to reflect the greater or
lesser number of shares of Stock or other securities into which
the Stock subject to the Option may have been changed, and
appropriate adjustments shall be made to other Awards to reflect
any such substitution or adjustment. Any adjustments to
Incentive Options shall comply with the requirements of Section
424 of the Code.
4.6 Determination by the Committee, Etc. Adjustments
under this Section 4 shall be made by the Committee, whose
determinations with regard thereto shall be final and binding upon
all parties thereto.
Section 5
Reorganization or Liquidation
If the Company is merged or consolidated with another
corporation and the Company is not the surviving corporation, or
if all or substantially all of the assets or more than fifty
percent (50%) of the outstanding voting stock of the Company is
acquired by any other corporation, business entity or person, or
in case of a reorganization (other than a reorganization under
the United States Bankruptcy Code), including a divisive
reorganization under Section 355 of the Code, or liquidation of
the Company, and if the provisions of Section 12 do not apply,
the Committee, or the board of directors of any corporation
assuming the obligations of the Company, shall, as to the Plan
and outstanding Options and other Awards, either (i) make
appropriate provision for the adoption and continuation of the
Plan or a similar plan by the acquiring or successor corporation
or by the corporation that employs the Participant following the
reorganization and for the protection of any such outstanding
Options and other Awards by the substitution on an equitable
basis of appropriate stock of the Company or of the merged,
consolidated or otherwise reorganized corporation which will be
issuable with respect to the Stock, provided that no additional
benefits shall be conferred upon the Participants holding such
Options and other Awards as a result of such substitution, and
the excess of the aggregate Fair Market Value of the shares
subject to the Options immediately after such substitution over
the Option Price thereof is not more than the excess of the
aggregate Fair Market Value of the shares subject to such Options
immediately before such substitution over the Option Price
thereof, or (ii) upon written notice to the Participants, provide
that all unexercised Options must be exercised within a specified
number of days of the date of such notice or they will be
terminated. In the latter event, the Committee shall accelerate
the exercise dates of outstanding Options and accelerate the
restriction period and modify the performance requirements for
any outstanding Awards so that all Options and Awards become
fully vested or payable prior to any such event. The Committee
may, in its sole discretion, establish a date by which
outstanding Options must be exercised prior to reorganization, or
establish periods during which Options may not be exercised, in
order to comply with corporate or securities law or to facilitate
the orderly administration of the Plan.
Section 6
Participation
6.1 In General. Participants in the Plan shall be
those Eligible Employees who, in the judgment of the Committee, are
performing, or during the term of their incentive arrangement will perform,
vital services in the management, operation and development of
the Company or an Affiliated Corporation, and significantly
contribute, or are expected to significantly contribute, to the
achievement of long-term corporate economic objectives.
Participants may be granted from time to time one or more Awards;
provided, however, that the grant of each such Award shall be
separately approved by the Committee, and receipt of one such
Award shall not result in automatic receipt of any other Award.
Upon determination by the Committee that an Award is to be
granted to a Participant, written notice shall be given to such
person, specifying the terms, conditions, rights and duties
related thereto. Each Participant shall, if required by the
Committee, enter into an agreement with the Company, in such form
as the Committee shall determine and which is consistent with the
provisions of the Plan, specifying such terms, conditions, rights
and duties. Awards shall be deemed to be granted as of the date
specified in the grant resolution of the Committee, which date
shall be the date of any related agreement with the Participant.
In the event of any inconsistency between the provisions of the
Plan and any such agreement entered into hereunder, the
provisions of the Plan shall govern.
6.2 Restriction on Award Grants to Certain Individuals.
Notwithstanding the foregoing provisions of Section
6.1, the Committee shall not grant any Award to any lineal descendant
of Adolph Coors, Jr. without first consulting with tax counsel for
the Company as to the effect of such grant on the status of the
Company as a "personal holding company" within the meaning of
Section 542 of the Code.
6.3 General Restrictions on Awards.
Awards covering no more than 600,000 shares of Stock may be
granted to any Participant under this Plan during any calendar
year, beginning with the 1997 calendar year. The number of
shares set forth in the preceding sentence shall be adjusted to
reflect changes in the capital of the Company in accordance with
the provisions of Section 4.3 and 4.4. To the extent required by
Section 162(m) of the Code, shares of Stock subject to Awards
which are canceled or which are otherwise adjusted as provided in
Section 162(m) of the Code shall continue to be counted against
the foregoing.
Section 7
Stock Options
7.1 Grant of Stock Options. Coincident with or following
designation for participation in the Plan, a Participant may be granted
one or more Options. The Committee in its sole discretion shall
designate whether an Option is an Incentive Option or a Non-
Qualified Option. The Committee may grant both an Incentive
Option and a Non-Qualified Option to an Eligible Employee at the
same time or at different times. Incentive Options and Non-
Qualified Options, whether granted at the same time or at
different times, shall be deemed to have been awarded in separate
grants and shall be clearly identified, and in no event shall the
exercise of one Option affect the right to exercise any other
Option or affect the number of shares of Stock for which any
other Option may be exercised, except as provided in subsection
7.2(j). An Option shall be considered as having been granted on
the date specified in the grant resolution of the Committee.
7.2 Stock Option Certificates. Each Option granted under
the Plan shall be evidenced by a written stock option certificate. A stock
option certificate shall be issued by the Company in the name of
the Participant to whom the Option is granted (the "Option
Holder") and shall incorporate and conform to the conditions set
forth in this Section 7.2.
(a) Number of Shares. Each stock option certificate
shall state that it covers a specified number of shares of
the Stock, as determined by the Committee.
(b) Price. The price at which each share of Stock
covered by an Option may be purchased shall be determined in each
case by the Committee and set forth in the stock option certificate,
but in no event shall the price be less than 100 percent of the Fair
Market Value of the Stock on the date the Option is granted.
(c) Duration of Options: Restrictions on Exercise. Each
stock option certificate shall state the period of time, determined
by the Committee, within which the Option may be exercised by the Option
Holder (the "Option Period"), and shall also set forth any
installment or other restrictions on Option exercise during such
period, if any, as may be determined by the Committee. The
Option Period for Incentive Options must end, in all cases, not
more than 10 years from the date the Incentive Option is granted.
(d) Termination of Employment, Death, Disability, Etc.
The Committee may, at the time of grant of an Option, specify the
period during which the Option may be exercised following
termination of employment. The Committee may amend an Option
previously granted to an Option Holder to extend the period during
which the Option may be exercised following termination of employment.
The effect of this subsection 7.2(d) shall be limited to determining
the consequences of a termination and nothing in this subsection
7.2(d) shall restrict or otherwise interfere with the Company's
discretion with respect to the termination of any person's
employment or other relationship with the Company. If the
Committee does not so specify at the time of the grant of an
Option or does not subsequently amend the Option, the following
shall apply:
(i) If the employment of the Option Holder is
terminated within the Option Period for cause, as determined by
the Company, the Option shall thereafter be void for all purposes.
As used in this subsection 7.2(d), "cause" shall mean, as
determined by the Company, a violation of the Company's established
policies and procedures or a breach of the Option Holder's fiduciary
duty to the Company, provided that the effect of this subsection 7.2(d)
shall be limited to determining the consequences of a termination
and that nothing in this subsection 7.2(d) shall restrict or
otherwise interfere with the Company's discretion with respect to
the termination of any employee.
(ii) If the Option Holder retires from employment
by the Company or its affiliates during the Option Period pursuant
to the Company's Retirement Plan, the Option may be exercised
by the Option Holder, or in the case of death by the persons
specified in subsection (iii) of this subsection 7.2(d), during the
remainder of the Option Period; provided, however, that the Committee may,
in its sole discretion, at the time of the Option Holder's
retirement, require that the Option be exercised within such
shorter period as may be specified by the Committee, which in no
event shall be less than three months (provided that such
exercise must occur within the Option Period). The foregoing
sentence shall apply only to Options granted under the Plan on or
after February 13, 1996. The provisions of the Plan in effect
prior to such date shall apply to Options granted prior to such
date. If the Option Holder becomes disabled (as determined
pursuant to the Company's Long-Term Disability Plan), the Option
may be exercised by the Option Holder, or in the case of death by
the persons specified in subsection (iii) of this subsection
7.2(d), within thirty-six months following his or her disability
(provided that such exercise must occur within the Option
Period). In any of the foregoing cases, the Option may be
exercised only within the applicable time period specified above
and only as to the shares as to which the Option had become
exercisable on or before the date of the Option Holder's
termination of employment.
(iii) If the Option Holder dies during the
Option Period while still employed or within the three-month
period referred to in (iv) below, or within the applicable period
referred to in (ii) above, the Option may be exercised by those
entitled to do so under the Option Holder's will or by the laws of
descent and distribution within fifteen months following the
Option Holder's death (provided that such exercise must
occur within the Option Period), but not thereafter. In any
such case, the Option may be exercised only as to the shares as to
which the Option had become exercisable on or before the date of
the Option Holder's death.
(iv) If the employment of the Option Holder by
the Company is terminated (which for this purpose means that the
Option Holder is no longer employed by the Company or by an
Affiliated Corporation) within the Option Period for any reason
other than cause, retirement pursuant to the Company's Retirement
Plan, disability or the Option Holder's death, the Option may
be exercised by the Option Holder within three months following the
date of such termination (provided that such exercise must
occur within the Option Period), but not thereafter. In any such
case, the Option may be exercised only as to the shares as to which the
Option had become exercisable on or before the date of termination of
employment.
(e) Transferability. Each Option shall not be transferable
by the Option Holder except by will or pursuant to the laws of descent
and distribution, and such Option shall be exercisable during the
Option Holder's lifetime only by him or her, or in the event of
disability or incapacity, by his or her guardian or legal
representative. Notwithstanding the foregoing to the contrary,
at the Committee's discretion, an Option may permit the transfer
of such Option, other than an Incentive Option, by the recipient
thereof, subject to such terms, conditions and limitations
prescribed by the Committee, and the applicable transferee of
such Option shall be treated under the Plan and any agreement
covering such Option as the Participant for purposes of any
exercise of such Option.
(f) Agreement to Continue in Employment. Each Option
Holder agrees to remain in the employment of the Company, at the
pleasure of the Company, for a continuous period of at least one year
after the date of such stock option agreement, at the salary rate in
effect on the date of such agreement or at such changed rate as
may be fixed, from time to time, by the Company.
(g) Exercise, Payments, Etc.
(i) The method for exercising the Option granted therein
shall be by delivery to the Corporate Secretary of the Company a written
notice specifying the number of shares with respect to which such
Option is exercised and payment of the Option Price. Such notice
shall be in a form satisfactory to the Committee and shall
specify the particular Option (or portion thereof) that is being
exercised and the number of shares with respect to which the
Option is being exercised. The exercise of the Stock Option
shall be deemed effective upon receipt of such notice by the
Corporate Secretary and payment to the Company. If requested by
the Company, such notice shall contain the Option Holder's
representation that he or she is purchasing the Stock for
investment purposes only and his or her agreement not to sell any
Stock so purchased in any manner that is in violation of the
Securities Act of 1933, as amended, or any applicable state law.
Such restrictions, or notice thereof, shall be placed on the
certificates representing the Stock so purchased. The purchase
of such Stock shall take place at the principal offices of the
Company upon delivery of such notice, at which time the purchase
price of the Stock shall be paid in full by any of the methods or
any combination of the methods set forth in (ii) below. A
properly executed certificate or certificates representing the
Stock shall be issued by the Company and delivered to the Option
Holder. If shares of Stock are used to pay all or part of the
exercise price, an additional certificate shall be issued by the
Company and delivered to the Option Holder representing the
additional shares, in excess of the Option Price, to which the
Option Holder is entitled as a result of the exercise of the
Option.
(ii) The exercise price shall be paid by any of
the following methods or any combination of the following methods:
(A) in cash;
(B) by certified or cashier's check payable to the
order of the Company;
(C) by delivery to the Company of a written
statement of attestation, in such form as may be prescribed
for this purpose by the Committee, signed by the Option Holder and
certifying that the Option Holder is electing to use a
specified number of shares of Stock then owned by the Option
Holder to pay the purchase price of the Stock purchased
pursuant to the Option and that the Option Holder is
electing to have issued to him or her the additional shares
of Stock, in excess of the Option Price, to which the Option
Holder is entitled as a result of the exercise of the
Option; provided, however, that no shares of Stock owned by
an Option Holder may be used for this purpose unless such
Stock has been held by the Option Holder for more than six
months; for purposes of this Plan, the Fair Market Value of
any shares of Stock designated by an Option Holder as
payment of the purchase price upon exercise of the Option
shall be the Fair Market Value as of the exercise date; the
exercise date shall be the day of delivery of the
certificate of attestation with respect to the shares of
Stock used as payment of the Option Price; or
(D) by delivery to the Company of a properly
executed notice of exercise together with irrevocable instructions
to a broker to deliver to the Company promptly the amount of
the proceeds of the sale of all or a portion of the Stock or of
a loan from the broker to the Option Holder necessary to pay
the exercise price.
(h) Date of Grant. An option shall be considered as
having been granted on the date specified in the grant resolution
of the Committee.
(i) Notice of Sale of Stock: Withholding. Upon exercise
of the Option, the Option Holder shall make appropriate arrangements
with the Company to provide for the amount of additional
withholding required by Sections 3102 and 3402 of the Code and
applicable state income tax laws, including payment of such taxes
through delivery of shares of Stock or by withholding Stock to be
issued under the Option, as provided in Section 18.
(j) Issuance of Additional Option. If an Option Holder
pays all or any portion of the exercise price of a substituted Option
with Stock, or pays all or any portion of the applicable withholding
taxes with respect to the exercise of a substituted Option with
Stock that has been held by the Option Holder for more than a
period, not shorter than six months, to be determined by the
Committee, the Committee may, in its sole discretion, grant to
such Option Holder a new Option covering the number of shares of
Stock used to pay such exercise price and/or withholding tax.
The new Option shall have an Option Price per share equal to the
Fair Market Value of a share of Stock on the date of the exercise
of the substituted Option and shall have the same terms and
provisions as the substituted Option, except as otherwise
determined by the Committee in its sole discretion.
7.3 Restrictions on Incentive Options.
(a) Initial Exercise. The aggregate Fair Market
Value of the shares of Stock with respect to which Incentive
Options are exercisable for the first time by an Option Holder in
any calendar year, under this Plan or otherwise, shall not exceed
$100,000. For this purpose, the Fair Market Value of the shares
of Stock shall be determined as of the date of grant of the
Incentive Option.
(b) Ten Percent Shareholders. Incentive Options
granted to an Option Holder who is the holder of record of ten
percent (10%) or more of the outstanding Stock of the Company
shall have an Option Price equal to 110 percent (110%) of the
Fair Market Value of the shares of Stock on the date of grant of
the Option and the Option Period for any such Option shall not
exceed five years.
7.4 Shareholder Privileges. No Option Holder shall have
any rights as a shareholder with respect to any shares of Stock
covered by an Option until the Option Holder becomes the holder of
record of such Stock, and no adjustments shall be made for dividends
or other distributions or other rights as to which there is a record
date preceding the date such Option Holder becomes the holder of
record of such Stock, except as provided in Section 4.
Section 8
Restricted Stock Awards
8.1 Grant of Restricted Stock Awards. Coincident with or
following designation for participation in the Plan, the Committee may
grant a Participant one or more Restricted Stock Awards
consisting of shares of Stock. The number of shares granted as a
Restricted Stock Award shall be determined by the Committee.
8.2 Restrictions. A Participant's right to retain a Restricted
Stock Award granted to him under Section 8.1 shall be subject to such
restrictions, including but not limited to his continuous
employment by the Company or an Affiliated Corporation for a
restriction period specified by the Committee or the attainment
of specified performance goals and objectives, as may be
established by the Committee with respect to such Award. The
Committee may in its sole discretion require different periods of
employment or different performance goals and objectives with
respect to different Participants, to different Restricted Stock
Awards or to separate, designated portions of the Stock shares
constituting a Restricted Stock Award. In the event of the death
or disability (as defined in subsection 7.2(d)) of a Participant,
or the retirement of a Participant in accordance with the
Company's established retirement policy, all employment period
and other restrictions applicable to Restricted Stock Awards then
held by him shall lapse with respect to a pro rata part of each
such Award based on the ratio between the number of full months
of employment completed at the time of termination of employment
from the grant of each Award to the total number of months of
employment required for such Award to be fully nonforfeitable,
and such portion of each such Award shall become fully
nonforfeitable. The remaining portion of each such Award shall
be forfeited and shall be immediately returned to the Company.
In the event of a Participant's termination of employment for any
other reason, any Restricted Stock Awards as to which the
employment period or other restrictions have not been satisfied
(or waived or accelerated as provided herein) shall be forfeited,
and all shares of Stock related thereto shall be immediately
returned to the Company.
8.3 Privileges of a Stockholder, Transferability. A
Participant shall have all voting, dividend, liquidation and other
rights with respect to Stock in accordance with its terms received by
him as a Restricted Stock Award under this Section 8 upon his
becoming the holder of record of such Stock; provided, however,
that the Participant's right to sell, encumber, or otherwise
transfer such Stock shall be subject to the limitations of
Section 13.2 and Section 18.
8.4 Enforcement of Restrictions. The Committee shall cause a
legend to be placed on the Stock certificates issued pursuant to each
Restricted Stock Award referring to the restrictions provided by
Sections 8.2 and 8.3 and, in addition, may in its sole discretion
require one or more of the following methods of enforcing the
restrictions referred in Sections 8.2 and 8.3:
(a) Requiring the Participant to keep the Stock certificates,
duly endorsed, in the custody of the Company while the restrictions
remain in effect; or
(b) Requiring that the Stock certificates, duly endorsed,
be held in the custody of a third party while the restrictions remain in
effect.
Section 9
Purchase of Stock
9.1 General. From time to time the Company may make an
offer to certain Participants, designated by the Committee in its sole
discretion, to purchase Stock from the Company. The number of
shares of Stock offered by the Company to each selected
Participant shall be determined by the Committee in its sole
discretion. The purchase price for the Stock shall be the Fair
Market Value of the Stock on the date the Stock is purchased.
The Participants who accept the Company's offer shall purchase
the Stock at the time designated by the Committee. The purchase
shall be on such additional terms and conditions as may be
determined by the Committee in its sole discretion.
9.2 Other Terms. The Committee may, in its sole discretion,
grant Options, Restricted Stock, Stock Units, or any combination
thereof, on terms and conditions determined by the Committee, in
its sole discretion, to the Participants who purchase Stock
pursuant to Section 9.1.
Section 10
Stock Units
10.1 Grant. A Participant may be granted a number of Stock Units
determined by the Committee. The number of shares of Stock Units,
the goals and objectives to be satisfied with respect to
each grant of Stock Units, the time and manner of payment for
each Stock Unit, and the other terms and conditions applicable to
a grant of Stock Units shall be determined by the Committee.
10.2 Election Under Phantom Equity Plan. A Participant
who makes the election provided for in Section 17.4 of the Company's
Phantom Equity Plan to receive payment for his interest under the
Company's Phantom Equity Plan in shares of Stock shall receive a
grant of a number of Stock Units calculated pursuant to Section
17.4 of the Company's Phantom Equity Plan. The number of Stock
Units so determined shall be credited to a bookkeeping account in
the Participant's name on the books of the Company. A number of
shares of Stock equal to the number of Stock Units credited to
the Participant shall be transferred to the Participant at the
times and in the manner (lump sum or installments) specified in
Section 17.4 of the Phantom Equity Plan and as otherwise provided
under the Phantom Equity Plan.
Section 11
Other Common Stock Grants
From time to time during the duration of this Plan, the
Board may, in its sole discretion, adopt one or more incentive
compensation arrangements for Participants pursuant to which the
Participants may acquire shares of Stock, whether by purchase,
outright grant, or otherwise. Any such arrangements shall be
subject to the general provisions of this Plan and all shares of
Stock issued pursuant to such arrangements shall be issued under
this Plan.
Section 12
Change in Control
12.1 In General. Upon a change in control of the Company
(which for this purpose means ACX Technologies, Inc.) as defined in
Section 12.3, then (a) all Options shall become immediately exercisable
in full during the remaining term thereof, and shall remain so, whether
or not the Participants to whom such Options have been granted
remain employees of the Company or an Affiliated Corporation; (b)
all restrictions with respect to outstanding Restricted Stock
Awards shall immediately lapse; and (c) all Stock Units shall
become immediately payable.
12.2 Limitation on Payments. If the provisions of this
Section 12 would result in the receipt by any Participant of a
payment within the meaning of Section 280G of the Code and the
regulations promulgated thereunder and if the receipt of such
payment by any Participant would, in the opinion of independent
tax counsel of recognized standing selected by the Company,
result in the payment by such Participant of any excise tax
provided for in Sections 280G and 4999 of the Code, then the
amount of such payment shall be reduced to the extent required,
in the opinion of independent tax counsel, to prevent the
imposition of such excise tax; provided, however, that the
Committee, in its sole discretion, may authorize the payment of
all or any portion of the amount of such reduction to the
Participant.
12.3 Definition. For purposes of the Plan, a "change in
control" shall mean any of the following:
(i) The acquisition of or the ownership of fifty percent
or more of the total Stock of the Company then issued and outstanding,
by any person, or group of affiliated persons, or entities not
affiliated with the Company as of the Effective Date of this
Plan, without the consent of the Board, or
(ii) The election of individuals constituting a majority
of the Board who were not either (A) members of the Board prior to the
election or (B) recommended to the shareholders by management of the Company,
or
(iii) A legally binding and final vote of the shareholders
of the Company in favor of selling all or substantially all of the assets
of the Company.
Section 13
Rights of Employees; Participants
13.1 Employment. Nothing contained in the Plan or in any
Option, Restricted Stock Award or Stock Unit granted under the Plan shall
confer upon any Participant any right with respect to the
continuation of his employment by the Company or any Affiliated
Corporation, or interfere in any way with the right of the
Company or any Affiliated Corporation, subject to the terms of
any separate employment agreement to the contrary, at any time to
terminate such employment or to increase or decrease the
compensation of the Participant from the rate in existence at the
time of the grant of an Option, Restricted Stock Award or Stock
Unit. Whether an authorized leave of absence, or absence in
military or government service, shall constitute a termination of
employment shall be determined by the Committee at the time.
13.2 Nontransferability. Except as may be specifically
authorized by the Committee in accordance with the provisions
of subsection 7.2(e), no right or interest of any Participant in
an Option, a Restricted Stock Award (prior to the completion
of the restriction period applicable thereto), or a Stock Unit, granted
pursuant to the Plan, shall be assignable or transferable during
the lifetime of the Participant, either voluntarily or
involuntarily, or subjected to any lien, directly or indirectly,
by operation of law, or otherwise, including execution, levy,
garnishment, attachment, pledge or bankruptcy. In the event of a
Participant's death, a Participant's rights and interests in
Options, Restricted Stock Awards and Stock Units shall, to the
extent provided in Sections 7, 8, 9, and 11, be transferable by
will or the laws of descent and distribution, and payment of any
amounts due under the Plan shall be made to, and exercise of any
Options may be made by, the Participant's legal representatives,
heirs or legatees. If in the opinion of the Committee a person
entitled to payments or to exercise rights with respect to the
Plan is disabled from caring for his affairs because of mental
condition, physical condition or age, payment due such person may
be made to, and such rights shall be exercised by, such person's
guardian, conservator or other legal personal representative upon
furnishing the Committee with evidence satisfactory to the
Committee of such status.
13.3 No Plan Funding. Obligations to Participants under
the Plan will not be funded, trusteed, insured or secured in any manner. The
Participants under the Plan shall have no security interest in
any assets of the Company or any Affiliated Corporation, and
shall be only general creditors of the Company.
Section 14
General Restrictions
14.1 Investment Representations. The Company may require
any person to whom an Option, Restricted Stock Award, Stock Unit, or
Stock is granted, or to whom Stock is sold, as a condition of
exercising such Option, or receiving such Restricted Stock Award,
Stock Unit, or Stock, or purchasing such Stock, to give written
assurances in substance and form satisfactory to the Company and
its counsel to the effect that such person is acquiring the Stock
for his own account for investment and not with any present
intention of selling or otherwise distributing the same, and to
such other effects as the Company deems necessary or appropriate
in order to comply with Federal and applicable state securities
laws.
14.2 Compliance with Securities Laws. Each Option,
Restricted Stock Award, Stock Unit, and Stock grant or purchase
shall be subject to the requirement that, if at any time counsel
to the Company shall determine that the listing, registration or
qualification of the shares subject to such Option, Restricted Stock
Award, Stock Unit, or Stock grant or purchase upon any securities
exchange or under any state or federal law, or the consent or
approval of any governmental or regulatory body, is necessary as
a condition of, or in connection with, the issuance or purchase
of shares thereunder, such Option, Restricted Stock Award, Stock
Unit, Stock grant or purchase may not be accepted or exercised in
whole or in part unless such listing, registration,
qualification, consent or approval shall have been effected or
obtained on conditions acceptable to the Committee. Nothing
herein shall be deemed to require the Company to apply for or to
obtain such listing, registration or qualification.
14.3 Changes in Accounting Rules. Notwithstanding any
other provision of the Plan to the contrary, if, during the term
of the Plan, any changes in the financial or tax accounting rules
applicable to Options, Restricted Stock Awards or Stock Units
shall occur which, in the sole judgment of the Committee, may have
a material adverse effect on the reported earnings, assets or liabilities
of the Company, the Committee shall have the right and power to
modify as necessary, any then outstanding and unexercised
Options, outstanding Restricted Stock Awards, and outstanding
Stock Units as to which the applicable employment or other
restrictions have not been satisfied.
Section 15
Other Employee Benefits
The amount of any compensation deemed to be received by
a Participant as a result of the exercise of an Option, the sale
of shares received upon such exercise, the vesting of any
Restricted Stock Award, distributions with respect to Stock
Units, or the grant or purchase of Stock shall not constitute
"earnings" or "compensation" with respect to which any other
employee benefits of such employee are determined, including
without limitation benefits under any pension, profit sharing,
life insurance or salary continuation plan.
Section 16
Plan Amendment, Modification and Termination
The Board may at any time terminate, and from time to
time may amend or modify the Plan provided, however, that no
amendment or modification may become effective without approval
of the amendment or modification by the shareholders if
shareholder approval is required to enable the Plan to satisfy
any applicable statutory or regulatory requirements, or if the
Company, on the advice of counsel, determines that shareholder
approval is otherwise necessary or desirable.
No amendment, modification or termination of the Plan
shall in any manner adversely affect any Options, Restricted
Stock Awards, Stock Units, or Stock theretofore granted under the
Plan, without the consent of the Participant holding such
Options, Restricted Stock Awards, Stock Units, or Stock.
The Committee may amend or modify, in any manner, any
Award granted under the Plan to any Participant; provided that no
amendment or modification may adversely affect the Award without
the consent of the Participant holding the Award.
Section 17
Withholding
17.1 Withholding Requirement. The Company's obligations
to deliver shares of Stock upon the exercise of any Option, the
vesting of any Restricted Stock Award, payment with respect to Stock Units,
or the grant of Stock shall be subject to the Participant's
satisfaction of all applicable federal, state and local income
and other tax withholding requirements.
17.2 Withholding With Stock. At the time the Committee
grants an Option, Restricted Stock Award, Stock Unit, or Stock, it may,
in its sole discretion, grant the Participant an election to pay all
such amounts of tax withholding, or any part thereof, by electing
to transfer to the Company, or to have the Company withhold from
shares otherwise issuable to the Participant, shares of Stock
having a value equal to the amount required to be withheld or
such lesser amount as may be elected by the Participant. All
elections shall be subject to the approval or disapproval of the
Committee. The value of shares of Stock to be withheld shall be
based on the Fair Market Value of the Stock on the date that the
amount of tax to be withheld is to be determined (the "Tax
Date"). Any such elections by Participants to have shares of
Stock withheld for this purpose will be subject to the following
restrictions:
(a) All elections must be made prior to the Tax Date.
(b) All elections shall be irrevocable.
(c) If the Participant is an officer or director of the
Company within the meaning of Section 16 of the 1934 Act ("Section
16"), the Participant must satisfy the requirements of such Section 16
and any applicable Rules thereunder with respect to the use of Stock
to satisfy such tax withholding obligation.
Section 18
Company Right To Purchase Stock
18.1 Right of First Refusal.
(a) In the event of the death of a Participant, or if a
Participant at any time proposes to transfer any of the Stock
acquired pursuant to the Plan to a third party, the Participant
(or his personal representative or estate, as the case may be)
shall make a written offer (the "Offer") to sell all of the
Stock acquired pursuant to the Plan then owned by the Participant
(or thereafter acquired by the Participant's estate or personal
representative pursuant to any Award hereunder) to the Company at the
"purchase price" as hereinafter defined. The Company shall have the right
to elect to purchase all (but not less than all) of the shares of
Stock. The Company shall have the right to elect to purchase the
shares of Stock for a period of ten days after the receipt by the
Company of the Offer. In all cases, the purchase price for the
Stock shall be determined pursuant to subsection 18.1(d).
(b) The Company shall exercise its right to purchase
the Stock by giving written notice of its exercise to the
Participant (or his personal representative or estate, as the
case may be). If the Company elects to purchase the Stock,
payment for the shares of Stock shall be made in full by Company
check. Any such payments shall be made within ten days after the
election to purchase has been exercised.
(c) If the Stock is not purchased pursuant to the foregoing
provisions, the shares of Stock may be transferred by the Participant
to the proposed transferee named in the Offer to the Company, in the
case of a proposed sale to a third party. However, if such
transfer is not made within 120 days following the termination of
the Company's right to purchase, a new offer must be made to the
Company before the Participant can transfer any portion of his
shares and the provisions of this Section 18 shall again apply to
such transfer. In the event that the Company's right of first
refusal under this Section 18 is created by an event other than a
proposed transfer to a third party, the shares of Stock shall
remain subject to the provisions of this Section 18 in the hands
of the registered owner of the Stock.
(d) The purchase price for each share of Stock purchased
by the Company pursuant to this Section 18 shall be equal to the
Fair Market Value of the Stock on the date the Company receives
the Offer under subsection 18.1(a).
18.2 Marking of Certificates. Each certificate representing
shares of Stock acquired pursuant to this Plan shall bear the following
legend:
The shares of stock represented by this
Certificate are subject to all the terms of
the ACX Technologies, Inc. Equity Incentive
Plan, as the Plan may be amended from time to
time (the "Plan") and to the terms of a
[Non-Qualified Option Agreement] [Incentive
Option Agreement] [Restricted Stock
Agreement] [Stock Purchase Agreement] between
the Company and the Participant (the
"Agreement"). Copies of the Plan and the
Agreement are on file at the office of the
Company. The Plan and the Agreement, among
other things, limit the right of the Owner to
transfer the shares represented hereby and
provides that in certain circumstances the
shares may be purchased by the Company.
Section 19
Requirements of Law
19.1 Requirements of Law. The issuance of Stock and the payment
of cash pursuant to the Plan shall be subject to all applicable
laws, rules and regulations.
19.2 Federal Securities Law Requirements. If a Participant is
an officer or director of the Company within the meaning of Section
16, Awards granted hereunder shall be subject to all conditions
required under Rule 16b-3, or any successor rule promulgated
under the 1934 Act, to qualify the Award for any exception from
the provisions of Section 16(b) of the 1934 Act available under
that Rule. Such conditions shall be set forth in the agreement
with the Participant which describes the Award.
19.3 Governing Law. The Plan and all agreements hereunder shall
be construed in accordance with and governed by the laws of the
State of Colorado.
Section 20
Duration of the Plan.
The Plan shall terminate at such time as may be
determined by the Board of Directors, and no Option, Restricted
Stock Award, Stock Unit, or Stock shall be granted, or offer to
purchase Stock made, after such termination, provided, however,
that no Incentive Options may be issued under the Plan after
January 1, 2007. Options, Restricted Stock Awards, and Stock
Units outstanding at the time of the Plan termination may
continue to be exercised, or become free of restrictions, or
paid, in accordance with their terms.
ATTEST: ACX TECHNOLOGIES, INC.
________________________________ By:____________________________
Dated: _________________________
