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 and 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 24, 1999, 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 11,
1999 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:
FOR all Nominees listed below [ ] WITHHOLD AUTHORITY [ ]
(except as marked to the To Vote for all Nominees
contrary below) below
Joseph Coors, Jr.
John Hoyt Stookey
To withhold authority to vote for any nominee, line through the
name of the nominee above.
Unless contrary instructions are given, the shares represented
by this proxy will be voted FOR the election of all named nominee
directors.
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 11, 1999
The Annual Meeting of Shareholders of ACX Technologies, Inc.
("ACX" or the "Company"), a Colorado corporation, will be held on
May 11, 1999 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:
To elect two directors for a three-year term 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 24, 1999 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, 1999
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 11, 1999. The Proxy Statement and
Proxy card will be mailed or given to you on or about March 31,
1999.
Voting Procedure
If you return the signed proxy before the meeting, the
shares will be voted according to your directions. UNLESS YOU
INDICATE OTHERWISE ON YOUR PROXY CARD, THE SHARES WILL BE VOTED
"FOR" ALL DIRECTOR NOMINEES.
After giving a proxy, you may cancel it at any time before
it is exercised by (1) delivering written notice to the Company,
(2) substituting a new proxy executed at a later date, or (3)
requesting, in person at the Annual Meeting, that the proxy be
returned.
Who Can Vote and Votes Required
If you are a shareholder of record at the close of business
on March 24, 1999, you will be entitled to vote at the meeting.
As of March 24, 1999, there were 28,436,098 shares of the
Company's $.01 par value common stock outstanding (the "Common
Stock"). Each share of Common Stock is 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
election of directors requires that the nominees receive more
votes than any opposing candidates. Also, cumulative voting is
not allowed in the election of directors or for any other
purposes.
If you withhold authority to vote for a director nominee in
the election of directors, your vote will be excluded entirely
and will have no effect. If your shares are registered in the
name of a broker or other "street name" nominee, your votes will
only be counted as to those matters actually voted. If you do
not provide voting instructions, they will not be counted
(commonly referred to as "broker non-votes"). Broker non-votes
will be counted for purposes of determining the presence or
absence of a quorum for the transaction of business.
Solicitation Costs
The solicitation of your proxy will initially be conducted by
mail; however, further solicitations may be made by telephone or
oral communication. Officers, directors and employees of the
Company may solicit proxies but will not receive any special
compensation. Also arrangements, including reimbursement for
expenses in forwarding proxy materials, will be made with brokerage
houses and other custodians, nominees and fiduciaries to forward
proxy materials to beneficial owners of Common Stock. 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
under an agreement, later amended, which gives Crown Cork & Seal
the right to transfer GAC back to the Company before September
1999.
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 is elected for a three-year term. Two
Class II directors will be elected at the upcoming 1999 Annual
Meeting, three Class III directors at the 2000 Annual Meeting,
and three Class I directors at the 2001 Annual Meeting. Each of
the nominees is currently a director of the Company and has
agreed to serve on the Board if elected. If any of the nominees
for director is unavailable for election, the proxies will be
voted for a substitute nominee(s) designated by the Board.
Information about the nominees and each current director whose
term continues after the Annual Meeting follows:
Principal Occupation or Employment Director
and Directorships Age Since
NOMINEES FOR ELECTION AS CLASS II DIRECTORS
JOSEPH COORS, JR. 57 1992
President of the Company since its formation
in August 1992; Chairman of Coors Ceramics
since 1989, Chief Executive Officer of Coors
Ceramics since March 1997, and President of
Coors Ceramics from 1997 to October 1998;
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
(NYSE: HL), Golden Genesis Company, the
Company's majority-owned subsidiary and an
integrator and distributor of solar electric
systems, and Chairman of the Air Force Memorial
Foundation.
JOHN HOYT STOOKEY 69 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; also a
trustee of United States Trust Company of New
York and a director of Cyprus Amax Minerals
Company, Suburban Propane Partners, The Clark
Foundation and The Robert Sterling Clark
Foundation.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" EACH OF THE NOMINEES LISTED ABOVE
CLASS III DIRECTORS WHOSE TERMS EXPIRE AT THE 2000 ANNUAL MEETING
JOHN D. BECKETT 60 1993
President of the R. W. Beckett Corporation,
a manufacturer of components for oil and gas
heating, since 1965.
Principal Occupation or Employment Director
and Directorships Age Since
JOHN K. COORS 42 1996
President and Chief Operating Officer of
Coors Ceramics since October 1998; Chief
Executive Officer of Golden Genesis Company,
from January 1997 to October 1998; President
of Golden Genesis Company from July 1992 to
October 1998; Vice President and Plant
Manager of Coors Brewing Company's Memphis,
Tennessee brewery from January to July 1992;
also a director of Golden Genesis Company.
WILLIAM K. COORS 82 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.
CLASS I DIRECTORS WHOSE TERMS EXPIRE AT THE 2001 ANNUAL MEETING
JEFFREY H. COORS 54 1992
President of the Company since its formation
in August 1992; President of Graphic Packaging
from June 1997 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.
JOHN H. MULLIN, III 57 1992
Chairman of Ridgeway Farm since 1989, a
limited liability company engaged in timber
activities and farming; Director of ACCo from
1989 to 1992; also a director of Alex Brown
Realty, Inc., The Liberty Corporation, Carolina
Power & Light, Inc. and a trustee of The Putnam
Funds.
JAMES K. PETERSON 64 1997
President of The Peterson Group, an investment
firm, since 1990; Chief Executive Officer of
Graphic Packaging Corporation from 1982 to 1989;
Chief Operating Officer and a director of Ludlow
Corporation from 1980 to 1982; employed by
Continental Can Company from 1971 to 1980,
most recent position was Vice President.
BOARD OF DIRECTORS AND BOARD COMMITTEES
The Board of Directors held four regular meetings and two
special meetings during 1998. Each director attended at least 75
percent of the total number of meetings of the Board and the
committees on which he served, except Joseph Coors, Jr. who
attended 70% of the Board meetings.
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, which is described below.
However, he is not a voting member of the Board and is not
counted for quorum purposes.
The Board has established four standing committees: Audit,
Compensation, Executive and Director. Shareholders who wish to
recommend director candidates to the Director Committee should
provide the Secretary of the Company with the candidate's name,
biographical data and qualifications. Membership of the
Committees was as follows:
Board Member Board Audit Compensation Executive Director
W. K. Coors X* X*
J. D. Beckett X X X
R. P. Godwin X X*
J. K. Coors X
J. H. Mullin, III X X*
J. Coors, Jr. X X
J. K. Peterson X X
J. H. Coors X X X
J. H. Stookey X X X*
Meetings Held in 1998 6 4 4 4 1
* Chairman
Audit Committee (all members are nonemployee directors)
Reviews the scope and results of the audit of the Company by
the Company's independent accountants;
Recommends the appointment of the Company's independent
accountants;
Reviews the adequacy of the Company's systems of internal
control and accounting policies and procedures, including
compliance with the Company's ethics policy;
Directs and supervises investigations into matters within
the scope of its duties.
Compensation Committee (all members are nonemployee directors)
Reviews and recommends to the Board compensation of
management personnel;
Reviews and approves executive incentive and benefit plans.
Executive Committee (1 member is a nonemployee director and 2
members are employee directors)
Exercises all of the authority of the Board when the Board
is not in session except as provided in the Company's
Articles, Bylaws and applicable law.
Directors' Committee (2 members are nonemployee directors and 1
member is an employee director)
Considers and recommends nominees for election as directors;
Reviews and evaluates the performance of the Board.
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 $35,000, 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, with an exercise price equal
to 100% of market value on the date of grant, 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.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table lists beneficial ownership of Common
Stock as of March 24, 1999 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 (1) of
Class
Adolph Coors, Jr. Adolph Coors Company 2,800,000 9.8%
Trust (William K. Golden, Colorado
Coors, 80401
Jeffrey H. Coors,
J. Brad Coors,
Joseph Coors, and
Peter H. Coors,
co-trustees with
shared voting and
investment power)
Grover C. Coors Trust Adolph Coors Company 2,727,016 9.6%
(William K. Coors, Golden, Colorado
Jeffrey H. Coors, 80401
John K. Coors,
Joseph Coors, and
Joseph Coors, Jr.,
co-trustees with
shared voting and
investment power)
May Kistler Coors Trust Adolph Coors Company 1,726,652 6.1%
(William K. Coors, Golden, Colorado
Jeffrey H. Coors, 80401
Joseph Coors,
Joseph Coors, Jr. and
Peter H. Coors,
co-trustees with
shared voting and
investment power)
Jeffrey H. Coors (2)(3) ACX Technologies, Inc. 1,524,171 5.4%
16000 Table Mountain Parkway
Golden, Colorado 80403
Tweedy, Browne Company 52 Vanderbilt Avenue 1,481,685 5.2%
LLC and Affiliates New York, New York 10017
Herman F. Coors Trust Adolph Coors Company 1,435,000 5.0%
(William K. Coors, Golden, Colorado 80401
Jeffrey H. Coors,
Joseph Coors,
Joseph Coors, Jr. and
Peter H. Coors,
co-trustees with
shared voting and
investment power)
John D. Beckett (2) 22,311
*
John K. Coors (2)(4) 39,558
*
Joseph Coors, Jr. (2)(5) 708,240
2.5%
William K. Coors (2)(6) 912,735
3.2%
Richard P. Godwin (2)(7) 14,988
*
John H. Mullin, III (2) 25,737
*
James K. Peterson (2) 4,011
*
John Hoyt Stookey (2) 13,718
*
Jed J. Burnham (2) 99,990
*
Beth A. Parish (2)(8) 8,232
*
Jill B. W. Sisson (2)(9) 66,446 *
Directors and Executive Officers 2,653,725 9.3%
as a Group (12 persons)
* 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 786,412 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 the following shares held by Jeffrey H. Coors as
trustee as to which he disclaims beneficial ownership: (1)
178,064 shares: William K. Coors, Joseph Coors and Peter H.
Coors, co-trustees with shared voting and investment power;
and (2) 3,326,060 shares: William K. Coors, Joseph Coors,
Joseph Coors, Jr. and Peter H. Coors, co-trustees with shared
voting and investment power. Also does not include: 72,350
shares of Common Stock restricted and unissued until the
earlier of (i) grantee's retirement, death, disability or
termination of employment, or (ii) the year 2000 (5,726
shares), 2001 (3,600 shares), 2002 (5,344 shares), 2004
(10,096 shares), 2005 (11,443) and 2010 (12,618 shares); or
66,672 shares of Common Stock restricted and unissued until
retirement.
(4) Does not include 18,156 shares of Common Stock restricted
and unissued until retirement.
(5) Does not include 3,326,060 shares held by Joseph Coors,
Jr. as trustee as to which he disclaims beneficial ownership.
As to the 3,326,060 shares, Joseph Coors, Jr. shares voting
and investment power with Jeffrey H. Coors, Joseph Coors,
William K. Coors and Peter H. Coors. Also 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.
(6) Includes 786,412 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 the following shares held by William K. Coors as
trustee as to which he disclaims beneficial ownership: (1)
178,064 shares: Jeffrey H. Coors, Joseph Coors and Peter H.
Coors, co-trustees with shared voting and investment power;
and (2) 3,326,060 shares: Jeffrey H. Coors, Joseph Coors,
Joseph Coors, Jr. and Peter H. Coors, co-trustees with shared
voting and investment power.
(7) 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.
(8) Does not include 1,445 shares of Common Stock restricted
and unissued until the earlier of (i) grantee's death,
disability or termination of employment, or (ii) the year
2001.
(9) Does not include 11,192 shares of Common Stock restricted
and unissued until the earlier of (i) grantee's retirement,
death, disability or termination of employment, or (ii) the
year 2008 (582 shares) and 2009 (6,584 shares).
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
expected 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.
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. The data was gathered and
reported to the Company by an independent third-party consultant.
For 1998 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 1998 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 the
Company's subsidiary executive officers. The goals were set by
the Committee in December 1997 and included a "threshold" level
below which no bonus would be earned. Potential awards are
uncapped and may exceed 100 percent of salary. For 1998, the
Committee certified that the EPS goal exceeded target (50% of
base salary) and, therefore, cash bonuses paid to ACX executive
officers equaled 63 percent of base salary.
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 1998, 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 150
percent of the Office of the President's salaries.
Chief Executive Officer Compensation
Two members served in the Office of the President and shared
the chief executive officer function during 1998. 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.
Each member of the Office of the President participated in
the annual incentive opportunity described above and earned a
bonus for 1998 at the level of 63 percent of salary. The target
bonus opportunity for each member was 50 percent of salary.
Non-qualified stock options were granted to each member
during 1998 based on the guidelines described above and 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 $1 million deductibility cap.
In particular, the Committee sought and obtained shareholder
approval for the Company's Executive Incentive Plan and its
Equity Incentive Plan, as required under Section 162(m).
This report is submitted by the Compensation Committee of the
Board of Directors:
JOHN H. MULLIN, III, Chairman
JOHN HOYT STOOKEY
<TABLE>
EXECUTIVE COMPENSATION
<CAPTION>
Summary Compensation Table
Long-Term
Compensation
Annual Compensation Awards
<S> Other Restricted Securities All Other
Name and <C>Annual Stock Underlying Compen-
Principal <C> <C> (1) Compensa- Award(s) Options/ sation
Position Year Salary($) Bonus ($) tion($) ($)(2) SARs(#) ($)(3)
Jeffrey H. 1998 $485,000 $305,550 $56,150 (4) 67,048 $ 9,031
Coors
Office of 1997 $460,000 $479,780 $ 6,703 (5) 24,189 $ 8,053
the President
1996 $460,000 $437,460 $ 7,780
Joseph Coors, 1998 $485,000 $305,550 62,000 $12,705
Jr.
Office of 1997 $460,000 $479,780 $ 3,236 (5) 15,000 $ 8,659
the President
1996 $460,000 $437,460 $ 8,408
Jed J. 1998 $220,000 $138,600 $56,164 (4) 12,000 $ 8,842
Burnham
CFO and 1997 $195,000 $203,385 15,000 $ 4,000
Treasurer
1996 $185,008 $175,935 14,600 $ 3,750
Jill B.W. 1998 $182,500 $114,975 10,000 $ 6,241
Sisson
General 1997 $170,000 $177,310 13,358 $ 2,981
Counsel and
Secretary 1996 $162,004 $154,062 14,734 $ 3,750
Beth A. 1998 $110,000 $94,300 (7) $21,765 (8) 6,000 $ 3,374
Parish
Controller 1997 $75,252 $50,000 3,000 $ 1,850
1996 (6)
</TABLE>
(1) Bonuses shown are the total bonuses for 1998 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) 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 certain named executives under
salary continuation agreements. The stock units replace a
cash liability of the Company and tie the eligible 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 1998 and
the market value at year end 1998, respectively, were:
Jeffrey H. Coors - 66,672 units, 65 percent vested, valued
at $854,235 and Joseph Coors, Jr. - 64,032 units, 75 percent
vested, valued at $820,410.
(3) 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
- $5,031 and $4,000; Joseph Coors, Jr. - $8,705 and $4,000;
Jed J. Burnham - $4,842 and $4,000; Jill B. W. Sisson -
$2,303 and $3,938; and Beth A. Parish - $915 and $2,459.
(4) Amounts shown include the imputed value to the executive of
converting a company-owned country club membership to a
personal membership. The club memberships were valued at
$24,385 for Mr. Coors and $33,478 for Mr. Burnham. The
amount shown for Mr. Coors also includes an annual car
allowance of $18,000.
(5) Amounts shown are reimbursements during the year for taxes.
(6) Ms. Parish was elected Controller as of November 11, 1997.
Her total annual salary and bonus for 1996 did not exceed
$100,000.
(7) In addition to the annual cash bonus described in footnote
(1) above, Ms. Parish received a one-time bonus of $25,000
as a result of her election as an officer of the Company.
(8) Amount shown includes a personal benefit of $6,000 and an
annual car allowance of $12,000.
Option/SAR Grants in Last Fiscal Year
Individual Grants (1)
Number of % of Total
Securities Options/
Underlying SARs Exercise Grant Date
Options/ Granted to or Base Present
SARs Granted Employees Price Expiration Value ($)
Name (#) in Fiscal Yr. ($/Sh) Date (2)
Jeffrey H. 62,000 (3) $24.344 10-Feb-08 $795,460
Coors 5,048 (4) $24.031 27-Feb-08 $ 63,908
67,048 14.1%
Joseph 62,000 (3) 13.0% $24.344 10-Feb-08 $795,460
Coors, Jr.
Jed J. 12,000 (3) 2.5% $24.344 10-Feb-08 $153,960
Burnham
Jill B. W. 10,000 (3) 2.1% $24.344 10-Feb-08 $128,300
Sisson
Beth A. 6,000 (3) 1.3% $24.344 10-Feb-08 $ 76,980
Parish
(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)
28.1 percent stock price volatility based on the average
stock price volatility of the companies included in the S&P
Manufacturing (Diversified/Industrials) Index; (b) 5.63
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) Options granted annually which vest 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 1997
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
<TABLE>
<CAPTION>
<S> <C>Number of Securities Value of Unexer-
Shares Underlying Unexer- cised In-The-Money
Acquired cised Options/SARs Options/SARs
On Value at 12/31/98 (#) at 12/31/98 ($) (1)
Exercise Realized Exercis- Unexer- Exercis- Unexer-
(#) ($) able cisable able cisable
NAME
Jeffrey H. 4,369 $ 5,052 615,470 98,358 $223,198 $0
Coors
Joseph 5,900 $87,269 607,266 90,900 $273,418 $0
Coors, Jr.
Jed J. 74,965 26,867 $0 $0
Burnham
Jill B. W. 48,156 22,946 $0 $0
Sisson
Beth A. 2,000 8,500 $0 $0
Parish
(1) Value of unexercised options equals market value of the
shares ($12.8125) underlying in-the-money options at
December 31, 1998, 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 1998 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
$475,000 $124,688 $166,250 $207,813 $249,375 $261,250
$500,000 $131,250 $175,000 $218,750 $262,500 $275,000
$525,000 $137,813 $183,750 $229,688 $275,625 $288,750
$550,000 $144,375 $192,500 $240,625 $288,750 $302,500
$575,000 $150,938 $201,250 $251,563 $301,875 $316,250
(1) The maximum permissible benefit under ERISA from the
qualified Retirement Plan for 1998 was $130,000. In
addition, the maximum compensation for 1998 which may be
used in determining benefits from the qualified Retirement
Plan is $160,000. The Company has a non-qualified
supplemental retirement plan which provides the benefits
which are not payable from the qualified Retirement Plan
because of these limitations. The amounts shown in this
table include the benefits payable under the non-qualified
supplemental retirement plan. The benefit is computed on
the basis of a straight life annuity and is subject to a
reduction to reflect, in part, the payment of Social
Security benefits.
(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 highest average salary
amount over a 36 consecutive month period in the last ten
years. As of fiscal year-end 1998, 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 -
$466,808 and 27 years; Joseph Coors, Jr. - $466,808 and 22
years; Jed J. Burnham - $198,754 and 6 years; Jill B. W.
Sisson - $170,601 and 6 years; and Beth A. Parish - $84,137
and 11 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, a number of shares of
stock to be granted under the salary continuation agreements
described above in footnote 2 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 1998, the following individuals served on the
Compensation Committee: John H. Mullin, III and John Hoyt
Stookey. There were no compensation committee interlocks during
1998.
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 31,
1993 through December 31, 1998. The graph assumes that the value
of the investment in the Company's Common Stock and each index
was $100 at December 31, 1993 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 December 31, 1993 in Company Common Stock
[GRAPH APPEARS HERE]
12/31/93 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
S&P 500 $100 $ 98 $132 $162 $201 $263
S&P
Manu- $100 $102 $141 $189 $238 $301
Facturing
(Diversified)
ACX Tech- $100 $ 99 $ 76 $ 98 $124 $ 54
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Joseph Coors, William K. Coors, Joseph Coors, Jr., Jeffrey
H. Coors, John K. Coors, J. Brad Coors and Peter H. Coors are co-
trustees of one or more of the family trusts which collectively
own approximately 46% 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. J.
Brad Coors is a son of Joseph Coors, Jr. and a nephew of Jeffrey
H. Coors and John K. Coors, and is an employee of ACCo. 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 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, and in 1998 was renegotiated through 2001. The new
five-year agreement also provides for a three-year extension to
be negotiated by 2000. Under the starch supply agreement, Coors
Brewing agreed to purchase and Golden Technologies agreed to sell
100 million pounds of refined corn starch annually through 1997.
The starch supply agreement was amended in 1996 and, in March
1997, was extended through 1999. The starch manufacturing
facility was subsequently sold in January 1999 and the supply
agreement assigned to the purchaser. Total sales under these
supply contracts have been a material source of revenue for the
Company, accounting for sales of approximately $120,000,000 in
1998. Sales to CBC of approximately $103,300,000 are estimated
for the packaging contract for 1999 and the starch supply
contract through January 1999.
In addition to these supply agreements, prior to the sale of
the starch manufacturing facility, Coors Brewing and Golden
Technologies were parties to an agreement under which Golden
Technologies purchased brewery by-products and retained a
percentage of the net sales price on the resale of such by-
products. Payments to Coors Brewing under this contract were
approximately $9,750,000 in 1998 and approximately $436,000 in
January 1999.
In addition, certain subsidiaries of ACX and ACCo are
parties to a few miscellaneous market-based transactions. The
Company's real estate brokerage subsidiary and the partnership
described below received rental income from Coors Brewing for the
use of recreational facilities and Coors Brewing provided 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 1998, the Company received approximately $212,000 for the
services and products it provided to ACCo as described in this
paragraph, and anticipates it will receive approximately $179,000
for these services and products in 1999. During 1998, the
Company paid ACCo and its subsidiaries approximately $285,000 for
the services provided by ACCo as described in this paragraph, and
anticipates it will pay approximately $294,000 in 1999 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.
Distributions of $75,000 were made to each partner in 1998.
Distributions are allocated equally between the partners until
Coors Brewing recovers its investment and then 80 percent to the
general partner and 20 percent to Coors Brewing. It is estimated
that distributions for 1999 will be $1,000,000 to each partner.
Other Transactions
The real estate limited partnership described above proposed
the sale to Joseph Coors, Jr. in 1999 of four 35 acre parcels of
land located in Bear Tooth Ranch, north of Golden, Colorado. The
contract price for the four parcels is based on its appraised
value as follows: Parcel 1 at $325,000, Parcel 2 at $325,000,
Parcel 3 at $310,000 and Parcel 4 at $325,000. The Buyer has the
right to terminate the contracts prior to March 31, 1999, in
which case he will receive a refund of his earnest money, $5,000
per contract. The Buyer may also extend the contracts beyond
March 1999 at which time the earnest money will become non-
refundable.
In addition to the purchase price, the contracts require
that the Buyer drill a well prior to closing if there is not one
on the property. Three of the parcels do not have a well and the
cost of drilling is estimated at $8,000 to $15,000 per well. If
any contracts are extended beyond December 31, 1999, the land
will be reappraised and the contract price adjusted accordingly.
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. If
other matters should properly be presented at the Annual Meeting,
the persons named in the proxy will vote on these matters using
their best judgment.
INFORMATION ON INDEPENDENT ACCOUNTANTS
The Board has unanimously reappointed the firm of
PricewaterhouseCoopers LLP ("PWC") as independent accountants for
the 1999 fiscal year. A representative of PWC 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
PWC.
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 reports of ownership and changes of
ownership with the Securities and Exchange Commission. Based
upon information provided to the Company, the Company believes
that during the fiscal year ended December 31, 1998, persons
subject to this requirement filed the required reports on a
timely basis.
RESOLUTIONS PROPOSED BY INDIVIDUAL SHAREHOLDERS
In order to include a shareholder proposal 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 1999
fiscal year, it must be received by the Company no later than
December 31, 1999.
AVAILABILITY OF REPORT ON FORM 10-K
Upon your written request, the Company will provide a
complimentary 1998 Annual Report on Form 10-K (without exhibits).
Your request 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, 1999
Jill B. W. Sisson,
General Counsel and
Secretary
</TABLE>
