SCHEDULE 14A INFORMATION
(Rule 14a-101)
Proxy Statement Pursuant To Section 14(A) Of The Securities
Exchange Act Of 1934
(Amendment No. )
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ X ] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
TRINITY INDUSTRIES, INC.
(Name of Registrant as Specified In Its Charter)
J. J. FRENCH, JR., SECRETARY
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ X ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11: (1)
4) Proposed maximum aggregate value of transaction:
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the form
or schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
________________________
(1) Set forth amount on which the filing is calculated and state how it was
determined
<PAGE>
Trinity Industries, Inc.
2525 Stemmons Freeway
Dallas, Texas 75207-2401
P. O. Box 568887
Dallas, Texas 75356-8887
(mailing address)
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on July 20, 1994
Notice is hereby given that the Annual Meeting of Stockholders of
Trinity Industries, Inc. (the "Company"), a Delaware corporation, will be held
in the Auditorium of Lomas Financial Corporation, 35th Floor, 2001 Bryan
Tower, 2001 Bryan Street, Dallas, Texas 75201, on Wednesday, July 20, 1994,
at 9:30 a.m., Central Daylight Saving Time, for the following purposes:
(1) to elect eight (8) directors to hold office until the next Annual
Meeting of Stockholders or until their successors are elected and qualified;
(2) to approve the Company's Annual Incentive Bonus Plan for
Selected Executives; and
(3) to transact such other business as may properly come before
the meeting or any adjournment thereof.
Only stockholders of record at the close of business on May 27, 1994
will be entitled to notice of and to vote at the Annual Meeting or any
adjournment thereof, notwithstanding the transfer of any stock on the books of
the Company after such record date. A list of the stockholders will be open to
the examination of any stockholder, for any purpose germane to the Annual
Meeting, for a period of ten (10) days prior to the meeting at the Company's
offices, 2525 Stemmons Freeway, Dallas, Texas 75207.
You are requested to forward your proxy in order that you will be
represented at the 1994 Annual Meeting, whether or not you expect to attend in
person. Stockholders who attend the Annual Meeting may revoke their proxies
and vote in person, if they so desire.
A Proxy Statement, proxy card and a copy of the Annual Report on the
Company's operations during the fiscal year ended March 31, 1994, accompany
this Notice of Annual Meeting of Stockholders.
By Order of the Board of Directors
J. J. FRENCH, JR.
Secretary
June 9, 1994
<PAGE>
Trinity Industries, Inc.
2525 Stemmons Freeway
Dallas, Texas 75207-2401
P. O. Box 568887
Dallas, Texas 75356-8887
(mailing address)
PROXY STATEMENT
For
ANNUAL MEETING OF STOCKHOLDERS
To Be Held on July 20, 1994
This Proxy Statement is furnished to the stockholders of Trinity
Industries, Inc. (the "Company") in connection with the solicitation of proxies
by the Board of Directors of the Company to be voted at the Annual Meeting of
Stockholders of the Company to be held in the Auditorium of Lomas Financial
Corporation, 35th Floor, 2001 Bryan Tower, 2001 Bryan Street, Dallas, Texas
75201, on Wednesday, July 20, 1994, at 9:30 a.m., Central Daylight Saving
Time (the "1994 Annual Meeting"), or at any adjournment thereof, for the
purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders.
This Proxy Statement and the enclosed form of proxy are being mailed
to stockholders on or about June 9, 1994.
RIGHT TO REVOKE PROXY
Any stockholder giving the proxy enclosed with this Proxy Statement
has the power to revoke such proxy at any time prior to the exercise thereof by
filing with the Company a written revocation at or prior to the 1994 Annual
Meeting, by executing a proxy bearing a later date or by attending the 1994
Annual Meeting and voting in person the shares of stock that such stockholder
is entitled to vote. Unless the persons named in the proxy are prevented from
acting by circumstances beyond their control, the proxy will be voted at the
1994 Annual Meeting and at any adjournment thereof in the manner specified
therein, or if not specified, the proxy will be voted:
(1) FOR the election of the eight (8) nominees listed under
"Election of Directors" as nominees of the Company for election as directors to
hold office until the next Annual Meeting of Stockholders or until their
successors are elected and qualified;
(2) FOR the approval of the Company's Annual Incentive Bonus
Plan for Selected Executives; and
(3) At the discretion of the persons named in the enclosed form
of proxy, on any other matter that may properly come before the 1994 Annual
Meeting or any adjournment thereof.
BY WHOM AND THE MANNER IN WHICH PROXY IS BEING
SOLICITED
The enclosed proxy is solicited by and on behalf of the Board of
Directors of the Company. The expense of the solicitation of proxies for the
1994 Annual Meeting, including the cost of mailing, will be borne by the
Company. To the extent necessary to assure sufficient representation at the
1994 Annual Meeting, officers and regular employees of the Company, at no
additional compensation, may request the return of proxies personally, by
telephone or telegram. The extent to which this will be necessary depends
entirely upon how promptly proxies are received. Stockholders are urged to
send in their proxies without delay. The Company will supply brokers,
nominees, fiduciaries and other custodians with proxy materials to forward to
beneficial owners of shares in connection with the request from the beneficial
owners of authority to execute such proxies, and the Company will reimburse
such brokers, nominees, fiduciaries and other custodians for their expenses in
making such distribution. Management has no knowledge or information that
any other person will specially engage any persons to solicit proxies.
VOTING SECURITIES AND STOCKHOLDERS
The outstanding voting securities of the Company consist entirely of
shares of Common Stock, $1.00 par value per share, each share of which entitles
the holder thereof to one vote. The record date for the determination of the
stockholders entitled to notice of and to vote at the 1994 Annual Meeting, or
any adjournment thereof, has been established by the Board of Directors as of
the close of business on May 27, 1994. At that date, there were outstanding and
entitled to vote [ ] shares of Common Stock.
The presence, in person or by proxy, of the holders of record of a
majority of the outstanding shares of Common Stock entitled to vote is necessary
to constitute a quorum for the transaction of business at the 1994 Annual
Meeting, but if a quorum should not be present, the meeting may be adjourned
from time to time until a quorum is obtained. All matters to be voted on will
be decided by a majority of the shares represented and voting at the meeting,
except for the proposal to amend the Company's Certificate of Incorporation,
which will require approval by a majority vote of the shares of Common Stock
outstanding on the record date. A holder of Common Stock will be entitled to
one vote per share on each matter properly brought before the meeting.
Cumulative voting is not permitted in the election of directors.
As of May 27, 1994, no person was known by the Company to own
beneficially more than five percent (5%) of the outstanding shares of Common
Stock of the Company, although Cede and Company, a central clearinghouse and
nominee in New York, New York, was the record holder of [ ] shares of
the Company's Common Stock as of May 27, 1994.
The following table shows the number of shares of Common Stock
beneficially owned by each director or nominee, by the Company's Chief
Executive Officer and the next four most highly compensated executive officers
of the Company serving at the close of the Company's most recent fiscal year
and by all such directors, nominees and executive officers as a group, based
upon information supplied by them:
Number of Shares
Beneficially Owned Percent of
Name at May 27, 1994(1) Class
David W. Biegler 750 *
John Dane III 175,219 *
Barry J. Galt 8,250 *
Dean P. Guerin 55,500 *
Jess T. Hay 9,474(2) *
Edmund M. Hoffman 39,771(3) *
K. W. Lewis 48,164 *
Ray J. Pulley 44,000(4) *
John T. Sanford 60,119 *
Timothy R. Wallace 99,748 *
W. Ray Wallace 1,180,529 3.0%
Directors and Executive
Officers as a Group 1,889,408 4.8%
_________
* Less than one percent (1%).
(1) Unless otherwise noted, all shares are owned directly and the owner
has the right to vote the shares, except for shares that officers and
directors have the right to acquire under the Company's stock option
plans as of the record date or within sixty (60) days thereafter, which
for Messrs. Galt, Guerin, Hay, Hoffman and Pulley are 7,500 shares
each and for Messrs. Dane, Lewis, Sanford, Timothy R. Wallace and
W. Ray Wallace are 19,499, 15,000, 44,499, 96,750 and 288,750
shares, respectively.
(2) Includes 384 shares owned of record by Mr. Hay's wife as custodian
for their daughter in which Mr. Hay disclaims beneficial ownership.
(3) Includes 1,500 shares held by Mr. Hoffman as trustee of a trust in
which Mr. Hoffman disclaims beneficial ownership.
(4) Includes 24,500 shares held by NationsBank Texas, N.A., Profit
Sharing Trust over which Mr. Pulley has sole investment power and
also includes 1,500 shares owned by Mr. Pulley's wife.
_____________
ITEM 1 - ELECTION OF DIRECTORS
At the 1994 Annual Meeting, eight (8) directors are to be elected who
shall hold office until the next Annual Meeting of Stockholders or until their
respective successors are duly elected and qualified. It is the intention of
the persons named in the Company's proxy to vote for the election of each of the
eight (8) nominees listed below, unless authority is withheld. All nominees
have indicated a willingness to serve as directors, but if any of them should
decline or be unable to serve as a director, the persons named in the proxy will
vote for the election of another person recommended by the Board of Directors.
The Board of Directors recommends you vote FOR the election of
each of the eight (8) nominees to the Board of Directors set forth below.
Nominees
W. Ray Wallace, 71. Director since 1956. Chairman, President and Chief
Executive Officer of the Company. He is also a director of Lomas Financial
Corporation, a diversified financial services company, and ENSERCH
Corporation, a diversified energy company. He is the father of Timothy R.
Wallace, a director, Group Vice President of the Company, and Chairman of the
Railcars segment and LPG Containers division.
David W. Biegler, 47. Director since 1992. Chairman of the Audit Committee.
Mr. Biegler is the Chairman, President and Chief Executive Officer of
ENSERCH Corporation, a diversified energy company engaged principally in
oil and gas exploration and production, engineering design and construction,
utilities and other energy related activities. He is also a director of ENSERCH
Corporation, Enserch Exploration, Inc., which is the Managing General Partner
of Enserch Exploration Partners, Ltd., a partnership engaged in oil and gas
exploration, and Texas Commerce Bancshares, Inc., a bank holding company.
Barry J. Galt, 60. Director since 1988. Member of the Audit Committee. Mr.
Galt is the Chairman and Chief Executive Officer of Seagull Energy
Corporation, a diversified energy company engaged in interstate natural gas
transportation. natural gas processing and oil and gas exploration and
development. He is also a director of Standard Insurance Company, a life
insurance company, and Texas Commerce Bank, National Association, a
national bank.
Dean P. Guerin, 72. Director since 1965. Member of the Audit Committee
and Chairman of the Compensation Committee. Mr. Guerin is Chairman and
Chief Executive Officer of Berry-Barnett Food Distribution Company, a
wholesale distribution company. Prior to December 1988, Mr. Guerin was
Chairman of Eppler Guerin & Turner, Inc., an investment banking firm. Mr.
Guerin is a director of Circle K Corporation, which is engaged in operating
convenience stores, Lone Star Technologies, Inc., engaged in oil country tubular
goods and banking, and Seagull Energy Corporation, a diversified energy
company.
Jess T. Hay, 63. Director since 1965. Member of the Compensation
Committee. Mr. Hay is Chairman and Chief Executive Officer of Lomas
Financial Corporation, a diversified financial services company engaged
principally in mortgage banking and real estate lending. Mr. Hay is also a
trustee of Liberte Investors, a real estate investment trust, and a director of
Exxon Corporation, a diversified energy company engaged principally in the
exploration, production and marketing of petroleum products, Southwestern Bell
Corporation, a regional telephone operating company, and The Dial Corp.,
which is primarily involved in consumer products, services, transportation,
manufacturing and financial services.
Edmund M. Hoffman, 72. Director since 1957. Member of the Audit
Committee. Mr. Hoffman's principal
occupation is investments, primarily in the soft drink bottling and full line
vending business. Mr. Hoffman is also a director of Coca-Cola Bottling Group
(Southwest) Inc.
Ray J. Pulley, 78. Director since 1958. Member of the Compensation
Committee. Mr. Pulley's principal
occupation is investments.
Timothy R. Wallace, 40. Director since 1992. Mr. Wallace is a Group Vice
President of the Company and the Chairman of the Railcars segment and LPG
Containers division of the Company. He is the son of Mr. W. Ray Wallace,
a director and the Chairman, President and Chief Executive Officer of the
Company.
Board Meetings and Committees
The directors hold regular quarterly meetings, in addition to the
meeting immediately following the Annual Meeting of Stockholders, attend
special meetings, as required, and spend such time on the affairs of the Company
as their duties require. During the fiscal year ended March 31, 1994, the Board
of Directors held six (6) meetings. All directors of the Company attended at
least seventy-five percent (75%) of the aggregate of the meetings of the Board
of Directors and the committees on which they served for the fiscal year ended
March 31, 1994.
The Board of Directors has an Audit Committee consisting of Messrs.
Biegler, Galt, Guerin and Hoffman. The Audit Committee met three (3) times
during the fiscal year ended March 31, 1994. The Audit Committee's functions
include: (a) making recommendations to the Board of Directors for the
engagement or discharge of the independent auditors, (b) reviewing the plan and
results of the audit engagement with the independent auditors, (c) reviewing the
degree of independence of the independent auditors, (d) approving the services
performed by the independent auditors, (e) considering the range of audit and
other fees and (f) reviewing the adequacy of the Company's system of internal
controls.
The Board of Directors also has a Compensation Committee consisting
of Messrs. Guerin, Hay and Pulley. The Compensation Committee, which met
two (2) times during the fiscal year ended March 31, 1994, determines the base
salary and incentive compensation arrangements for, and the granting of benefits
to, officers of the Company and senior management of its subsidiaries. The
Compensation Committee also determines, in connection with the Company's
stock option and incentive plans, the persons to whom awards are granted, the
type of awards, the number of shares covered by the awards, whether stock
appreciation rights are granted, the option vesting schedule and, if other than
an incentive stock option for purposes of the Internal Revenue Code, the option
exercise price. See "Executive Compensation and Other Matters - Stock Option
Plans" below.
The entire Board of Directors acts as a nominating committee.
Compensation of Directors
Each director receives $1,250 for each director's meeting attended and
reimbursement for reasonable out-of-pocket expenses. In addition, each director
who is not a compensated officer or employee of the Company or its subsidiaries
receives a fee of $26,000 per year for serving as a director (and the Chairman
of the Audit Committee and the Chairman of the Compensation Committee
receive an additional $2,000 per year in those capacities) and $1,250 for
each Audit Committee or Compensation Committee meeting attended. Each
outside director (other than Mr. Biegler) holds an option to purchase 7,500
shares of the Company's Common Stock at an option exercise price of $22.50
per share, the market value of the Company's Common Stock at the time of the
grant. These options were granted at the time of the adoption of the Company's
1989 Stock Option Plan to each director who was not at that time an officer or
employee of the Company and were approved by the stockholders at the Annual
Meeting on July 19, 1989.
The Company also has a Directors' Retirement Plan that was adopted
on December 11, 1986. The plan is an unfunded arrangement through which
monthly payments will be paid to members of the Board of Directors who are
not employees of the Company upon retirement, disability or death while serving
as a director on or after December 11, 1986. The payments will be made to the
director and/or his designated beneficiary for a ten-year (10) period. The
amount of each monthly payment will be equal to one-twelfth (1/12) of a
percentage of the annual retainer paid to such director in the year of his
retirement, disability or death while serving as a director. The applicable
percentage is dependent upon the number of years of service as a member of the
Board of Directors. If the director has less than five (5) years of service,
the applicable percentage is zero. If the director has five (5) years of
service, the applicable percentage is fifty percent (50%). The applicable
percentage increases at the rate of ten percent (10%) for each year of service
thereafter and reaches one hundred percent (100%) after ten years of service as
a director. However, notwithstanding the number of years of service, a
director's applicable percentage will be one hundred percent (100%) in the
event of (i) any merger or consolidation in which the Company is not the
surviving corporation, (ii) a sale of all or substantially all of the assets of
the Company, (iii) a sale of shares of the Company's Common Stock in which
another corporation, person or entity acquires fifty percent (50%) or more
of the outstanding Common Stock or (iv) the acquisition of fifty percent (50%)
or more of the outstanding shares of the Company's Common Stock as a result of
any tender or exchange offer.
<PAGE>
EXECUTIVE COMPENSATION AND OTHER MATTERS
Cash Compensation
The following table sets forth information for the Company's fiscal
years ended March 31, 1994, 1993 and 1992, with regard to the compensation
for their services to the Company and its subsidiaries in all capacities of the
Chief Executive Officer and each of the other four (4) most highly compensated
executive officers serving the Company at the close of the Company's most
recently completed fiscal year:
Summary Compensation Table
Annual Long Term
Compensation Compen-
sation All
Other
Name and Year Other Stock Compen-
Principal Position Annual Option sation(4)
Salary Bonus(1) Compen- Awards
sation(2) (Shares)(3)
W. Ray Wallace - 1994 $900,000 $1,557,203 $211,367 - $28,312
Chairman, 1993 $800,000 $577,344 $183,227 150,000 $25,021
President & Chief 1992 $750,000 $272,003 $164,478 75,000 $24,805
Executive Officer
John Dane III -
Group Vice President 1994 $250,000 $336,325 - - $19,273
& President of 1993 $225,000 $467,618 - 150,000 $17,944
Marine Products 1992 $200,000 $122,660 - 37,500 $14,555
segment
K. W. Lewis - 1994 $250,000 $300,000 - - $17,225
Senior Vice President 1993 $225,750 $162,919 - 150,000 $16,877
1992 $215,000 $77,974 - 30,000 $16,805
Timothy R. Wallace -
Group Vice President 1994 $275,000 $197,643 - - $24,854
& Chairman of 1993 $252,000 $98,960 - 150,000 $22,886
Railcars 1992 $240,000 $25,000 - 37,500 $16,992
segment and LPG
Containers division
John T. Sanford -
Group Vice President 1994 $260,000 $112,580 - - $17,253
& Chairman of 1993 $236,500 $48,153 - 150,000 $16,902
Construction 1992 $225,000 $47,250 - 37,500 $16,880
Products and Metal
Components segments
(1) Annual incentive bonuses are paid only upon the achievement of a
predetermined financial goal set for each executive by the
Compensation Committee at the beginning of the fiscal year. All or a
portion of the incentive bonus is paid within ninety (90) days after the
close of the Company's fiscal year. If the incentive bonus earned
exceeds a certain percentage of base salary (ranging from twenty-five
percent (25%) in the case of some executives to fifty percent (50%) in
the case of other executives), the incentive bonus amount in excess of
the applicable percentage is deferred and paid in three (3) equal annual
installments in the succeeding years, provided the executive's
employment with the Company has not been terminated prior to
payment for any reason other than death, disability, retirement or a
change of control of the Company. The amounts shown for bonus in
the foregoing table include the deferred installments payable to the
executive in the succeeding year if still employed by the Company at
that time and were, in fiscal 1994, 1993, and 1992, respectively,
$1,107,203, $177,344 and $0 for Mr. W. Ray Wallace, $168,162,
$233,809, and $72,660 for Mr. Dane, $175,000, $50,044, and $0 for
Mr. Lewis, $115,143, $35,960, and $0 for Mr. Timothy R. Wallace
and $34,580, $0, and $0 for Mr. Sanford.
(2) An amount equal to fifteen per cent (15)% of the salary and incentive
bonus of Mr. W. Ray Wallace is set aside annually pursuant to the long
term deferred compensation plan for him.
(3) Adjusted for the three for two stock split on August 31, 1993.
(4) All Other Compensation consists principally of the matching amounts
under the Company's Supplemental Retirement Plan and Section 401(k)
Plan (described below under "Retirement Plans"), automobile
allowances, reimbursements for medical insurance premiums and, in
the case of Messrs. W. Ray Wallace and Timothy R. Wallace,
directors' fees.
_____________
Stock Options Plans.
The Company's 1993 Stock Option and Incentive Plan that was
approved by the stockholders at the Annual Meeting held on July 21, 1993
permits the grant of stock options, stock appreciation rights, restricted stock,
performance and other stock related awards. The 1993 stock option plan
terminated the Company's earlier 1989 stock option plan which in turn had
terminated the Company's 1983 stock option plan, except in each case for
options granted and outstanding under the prior plans. The 1993 plan provides
that stock options that expire, terminate or are surrendered unexercised under
the prior plans are available for further award under the 1993 plan. At April
30, 1994, options were granted and outstanding under the 1993 plan on 929,400
shares of the Company's Common Stock, under the 1989 plan on 854,364
shares, and under the 1983 plan on 135,747 shares.
The Compensation Committee of the Board of Directors determines the
officers and key employees to whom options are granted, the type of options, the
number of shares covered by such options, the option vesting schedule and, if
other than an incentive stock option for purposes of the Internal Revenue Code,
the option exercise price. In the case of incentive stock options, the Internal
Revenue Code requires that the option exercise price must not be less than the
fair market value of the stock at the time that the option is granted and, in
the case of any employee owning directly or indirectly more than ten percent
(10%) of the total outstanding Common Stock, the option exercise price for an
incentive stock option must be at least one hundred ten percent (110%) of the
fair market value. Options become exercisable as set forth in the option
agreements pursuant to which they are issued, but in no event are incentive
stock options exercisable after the expiration of ten (10) years from the date
of grant (or, in the case of an employee owning directly or indirectly more
than ten percent (10%) of the total outstanding Common Stock, five (5) years
from the date of grant).
Regardless of any vesting schedule contained in an option agreement, the plan
provides for the acceleration of vesting in certain events, including the
optionee's
death, disability or retirement, the dissolution or liquidation of the Company,
certain reorganizations of the Company or the acquisition of fifty percent (50%)
or more of the Company's outstanding Common Stock as a result of a tender or
exchange offer other than by the Company. All rights to exercise an option
terminate immediately if an employee is discharged for cause, and ten (10) days
after an employee's resignation, or three (3) months after an employee's
disability or retirement or twelve (12) months after an employee's death. All
stock appreciation rights and limited stock appreciation rights, if any,
terminate immediately upon cessation of employment, regardless of the reason
for such cessation.
Recipients of options may pay the option exercise price in cash or by
delivering to the Company shares of the Company's Common Stock already
owned by the optionee having a fair market value equal to the option exercise
price. When the optionee surrenders stock already owned by him in payment of
the exercise price, the optionee will be granted, except in limited instances, a
new option on shares equal in number to those surrendered at an option exercise
price that is the fair market value of the Company's Common Stock on the date
of the new grant and exercisable no earlier than six (6) months after the date
of such new grant. An optionee also may elect to satisfy the income tax
withholding requirement upon the exercise of a nonincentive stock option either
by payment of the amount of such withholding obligation in cash or through the
retention by the Company of a number of shares of Common Stock out of the
shares being purchased with a fair market value equal to the amount of the
withholding obligation, but no new option is awarded for the shares retained to
satisfy the employee's income tax withholding requirement.
The provisions of the 1993 plan may at any time or from time to time
be modified or amended by the Board of Directors; provided, however, no
option at any time outstanding may be impaired or canceled without the consent
of the holder thereof, and no amendment can increase the maximum number of
shares subject to the plan, reduce the option exercise price of shares contrary
to the provisions of the plan or materially modify the requirements as to
eligibility for participation in the plan, without stockholder approval.
Usually, stock options are granted in March of each year; however, in
March of 1993, the Compensation Committee was continuing to review the
effectiveness of the customary incentive stock options and considering other
possible alternatives. Consequently, the actual awards by the Compensation
Committee for fiscal 1993 did not become effective until April 13, 1993, when
the Board of Directors approved the Executive Stock Ownership Program
discussed below. The stock options so awarded to the five (5) executives named
in the Summary Compensation Table above are shown in such table as being
awarded in 1993 and were reported in the Proxy Statement for the Annual
Meeting held on July 21, 1993 under the table "Option Grants in Last Fiscal
Year". The Compensation Committee did not made any other stock option
awards in fiscal 1994.
One of the goals of the Executive Stock Ownership Program is to make
the key executives to whom options are granted long term stockholders of the
Company in order that their long range economic interests will be more directly
aligned with the long term economic interests of the Company's stockholders.
Further, the awards are designed to retain and develop a strong management
team who will be dependent upon value created for the Company's stockholders
for an accumulation of significant personal wealth. Hence, the options granted
under this Executive Stock Ownership Program become exercisable only in
annual installments over a period of eight (8) years (rather than five (5) years
as under the prior incentive stock option grants) and must be exercised before
ten (10) years from the date of the grant. More importantly, however, the
shares acquired pursuant to the exercise of an option granted under the
Executive Stock Ownership Program are restricted in respect to their
transferability and are not transferable from the date of the exercise
until the expiration of five (5) years thereafter, when fifty percent (50%)
of the shares become transferable, and until the expiration of ten years
thereafter, when the balance of the shares become transferable, except upon
death, disability or normal retirement or a change in the control of the
Company, or with the consent of the Compensation Committee (which consent
will only be granted upon special request in case of hardship, to purchase a
home, to pay for a child's education or for any other reason deemed
appropriate by the Compensation Committee).
The table below sets forth information concerning each exercise of
stock options by each of the named executive officers during the most recently
completed fiscal year and the number of exercisable and unexercisable stock
options held by them and the fiscal year-end value of the exercisable and
unexercisable options.
<PAGE>
Aggregated Option Exercises In Last Fiscal Year And FY-End Option Values(1)
Value of
Number of Unexercised
Unexercised in-the-Money
Shares Options at Fiscal Options at Fiscal
Acquired Value Year-End Year-End
Name on Realized
Exercise
Exercisable/ Exercisable/
Unexercisable Unexercisable
W. Ray Wallace 183,750 $3,513,890 270,000 $5,042,501
255,000 $3,295,002
John Dane III 31,501 $539,972 19,499 $378,605
190,500 $2,485,996
K. W. Lewis 16,500 $307,834 15,000 $289,625
181,500 $2,310,870
Timothy R. Wallace 0 $0 78,000 $1,532,876
192,000 $2,515,871
John T. Sanford 46,251 $755,442 25,749 $516,103
190,501 $2,486,014
(1) The Company has not granted any stock appreciation rights but most
of the stock options provide that the option may be surrendered for
cash for the difference between the then market value of the shares and
the option exercise price within thirty (30) days after the acquisition of
fifty percent (50%) of the Company's Common Stock pursuant to a
tender or exchange offer other than one made by the Company.
_____________
Retirement Plans.
The Company has noncontributory, defined benefit retirement and death benefit
plans which are available to all eligible employees who have completed specified
periods of employment. The benefits of the plans are funded by periodic
contributions to retirement trusts that invest the Company's contributions and
earnings thereon in order to pay the benefits to the employees. The plans
provide for the payment of monthly retirement benefits determined under a
calculation based on credited years of service and/or a participant's
compensation. Retirement benefits are paid to participants upon normal
retirement at the age of 65 or later, or upon early retirement. The plans also
provide for the payment of certain disability and death benefits.
The following table reflects the estimated annual benefits, computed on
the basis of a monthly benefit payable for ten (10) years certain and life
thereafter, payable to a fully vested executive officer of the Company upon
retirement at age 65 after 10, 20, 30 and 40 credited years of service at the
annual remuneration levels set forth in the table.
<PAGE>
Pension Plan Table
Years of Service
Remuneration 10 20 30 40
$100,000 . . . . . . . . . . . $9,760 $19,520 $29,280 $39,040
$150,000 . . . . . . . . . . . . 14,760 29,520 44,280 59,040
$200,000 . . . . . . . . . . . . 19,670 39,520 59,280 79,040
$250,000 . . . . . . . . . . . . 24,760 49,520 74,280 81,954
$300,000 . . . . . . . . . . . . 29,760 59,520 81,954 81,954
$350,000 . . . . . . . . . . . . 34,760 69,520 81,954 81,954
$400,000 . . . . . . . . . . . . 39,760 79,520 81,954 81,954
$450,000 . . . . . . . . . . . . 44,760 81,000 81,954 81,954
$500,000 . . . . . . . . . . . . 49,760 81,000 81,954 81,954
$550,000 . . . . . . . . . . . . 54,760 81,000 81,954 81,954
$600,000 . . . . . . . . . . . . 59,760 81,000 81,954 81,954
The compensation covered under the plan is the same as the salary and
bonus reported earlier in the Summary Compensation Table, except that
compensation for purposes of the plan is determined by the amount paid during
the calendar year and the amount shown in the Summary Compensation Table
has been determined on the basis of amount accrued during the Company's fiscal
year. The annual benefits shown are not subject to any deduction for Social
Security benefits or other offset amounts. Such annual benefits are those
applicable under the Tax Equity and Fiscal Responsibility Act of 1982
("TEFRA"). The five (5) executive officers named in the Summary
Compensation Table above have credited years of service under the plan under
which they are covered as follows: Mr. W. Ray Wallace has 48 years; Mr.
Dane has 7 years; Mr. Lewis has 30 years; Mr. Timothy R. Wallace has 19
years, and Mr. Sanford has 10 years. Because his accrued benefit was greater
than the maximum under TEFRA, Mr. W. Ray Wallace's annual benefit was
$126,933 during the fiscal year ended March 31, 1994.
The Company has also adopted a Supplemental Pension Plan that
permits the payment of supplemental benefits to employees whose annual
benefits under the foregoing retirement plan would exceed those permitted by the
Internal Revenue Code of 1986, as amended (the "Code"). The Supplemental
Pension Plan provides that if at any time the amount of the annual retirement
benefit which would otherwise be payable under the Company's pension plan is
or becomes limited by reason of compliance with the Code, such person shall be
entitled to receive a supplemental pension benefit equal to the difference
between the benefit that such person receives under the Company's pension plan
and the benefit that such person would have received if such limitation had not
been in effect. The benefits are payable from the general assets of the
Company.
The Company also is obligated to pay supplemental retirement benefits
to Mr. W. Ray Wallace, Chairman, President and Chief Executive Officer of the
Company, under an agreement with the Company in 1990 which provided that in
consideration of his continuing to serve as the Chief Executive Officer of the
Company until he attained age seventy (70), subject to his being so elected
annually, the Company would supplement, commencing at his actual retirement,
his other retirement benefits from the Company so that his aggregate retirement
benefits from the Company would equal eighty percent (80%) of the average of
his annual cash compensation for the five (5) consecutive years in which he was
paid by the Company his highest cash compensation. At March 31, 1994, the
estimated annual benefit payable to him upon his retirement under this unfunded
supplemental retirement program was $767,000.
The Company maintains a Section 401(k) plan that permits employees
to elect to set aside up to ten percent (10%) of their compensation (subject to
the maximum limit on the amount of compensation permitted by the Code to be
deferred for this purpose) in a trust to pay future retirement benefits. The
Company matches fifty percent (50%) of the lesser of (i) the amount that the
employee elects to set aside for this purpose or (ii) six percent (6%) of the
employee's compensation. The Company also maintains a similar plan for its
"highly compensated employees", as defined in the Code. The highly
compensated employees are not limited as to the percentage of their
compensation which may be contributed to the plan; however, the Company
only matches the lesser of (i) the amount that the employee elects to set aside
for this purpose or (ii) six percent (6%) of the employee's compensation(but the
Company never contributes more than it would have contributed if the "highly
compensated employees" had participated in the Section 401(k) plan).
Participation in the Section 401(k) plan by all such "highly compensated
employees" would have an adverse effect on the Section 401(k) plan.
Contributions under the latter plan are also made to a trust, but unlike the
contributions by the Company to the trust created pursuant to the Section 401(k)
plan (which are deductible by the Company when paid to the trust), the
contributions of the Company to the trust for the "highly compensated
employees" are not deductible by the Company for federal income tax purposes
until such amounts are paid out by the trust. Further, the assets of the trust
created under the plan for the "highly compensated employees" are considered
part of the general assets of the Company that can be attached by its creditors.
Change of Control Agreements
On June 8, 1989, the Board of Directors authorized agreements with
each of the executive officers named in the Summary Compensation Table above
and others to provide certain severance benefits to them in the event of a
termination of employment following a change of control (as defined in the
agreements) of the Company. Each agreement provides that if the Company
terminates the executive's employment other than as a result of the executive's
death, disability or retirement, or for cause (as defined in the agreements), or
if the executive terminates his employment for good reason (as defined in the
agreements), then the Company will pay to such executive a lump sum equal to
three (3) times the amount of the executive's base salary and bonus paid by the
Company and its subsidiaries to the executive during the twelve (12) months
prior to termination or, if higher, the twelve (12) months prior to the change
of control of the Company.
The severance benefits provided by the agreements also include certain
fringe benefits to which each executive would have been entitled if the
executive had continued in the employment of the Company for thirty-six (36)
months after the executive's termination, and a supplemental benefit based
on the Company's retirement plan, which benefit is payable in a series of
cash payments.
The agreements further provide that if any payment to which the
executive is entitled would be subject to the excise tax imposed by Section 4999
of the Internal Revenue Code of 1986, as amended, then the Company will pay
to the executive an additional amount so that the net amount retained by the
executive is equal to the amount that otherwise would be payable to the
executive if no such excise tax had been imposed.
Report of the Compensation Committee on Executive Compensation
The following report is submitted by the Compensation Committee for
inclusion in this Proxy Statement pursuant to the rules of the Securities and
Exchange Commission:
The Company's executive compensation program is administered by the
Compensation Committee appointed by the Board of Directors and is composed
of independent, outside directors. The Compensation Committee is responsible
for setting and overseeing the administration of policy that governs the
compensation of the Company's executives. It establishes the base salary, the
incentive compensation, the deferred compensation and the stock options of each
officer of the Company.
It is the Compensation Committee's policy to provide a competitive and
comprehensive compensation program to attract, motivate, reward and retain the
key executives needed to enhance the profitability of the Company and to create
value for its stockholders. The Compensation Committee believes that the
Company's executive compensation should consist of competitive base salaries
and incentive compensation plans that reward both short and long term
performance. The key components of the Company's executive compensation
program in the last fiscal year were a base salary and incentive compensation.
The Compensation Committee periodically reviews each component of the
Company's executive compensation program to ensure that pay levels and
incentive opportunities are competitive, directly linked to performance and
aligned with the interest of stockholders.
Section 162(m) of the Internal Revenue Code, added in 1993, generally
disallows a tax deduction to public companies for compensation over $1 million
paid to a corporation's chief executive officer and four other most highly
compensated executive officers. Qualifying performance-based compensation
will not be subject to the deduction limit if certain requirements are met. The
Company intends to structure its awards of performance-based compensation in
a manner that complies with this new statute.
Base Salary
The Compensation Committee each year reviews each executive's
performance and establishes each executive's base salary based upon past and
expected future performance, and the executive's responsibilities within the
Company. The Compensation Committee also considers the salaries of senior
executives of other companies, utilizing data obtained from independent, outside
sources. Base salaries are determined each year for each executive of the
Company and are made effective on April 1, the commencement of the
Company's fiscal year. Base salaries for the Chief Executive Officer and each
of the other four most highly compensated officers for the fiscal years ending
March 31, 1994, 1993 and 1992 are shown in the Summary Compensation
Table.
Incentive Compensation
The Company's annual incentive bonuses of its executive officers are
tied to the Company's success in achieving significant performance goals. An
incentive bonus is determined for each executive upon the basis of the
achievement of certain financial goals set each year by the Compensation
Committee at the beginning of the year. The Company's corporate executives
have performance targets measured by the Company's consolidated income
before federal income tax; the division executives responsible for the operation
of a division or segment of the Company have performance targets measured by
the achievement of certain operating profits for that division or segment. The
performance goals are predetermined by the Compensation Committee on the
basis the Company's past performance and anticipated future performance. In
the case of corporate executives, no incentive compensation is earned unless the
Company reports income before federal income tax of a certain preestablished
amount. Upon achievement of that amount, an incentive bonus of a specified
percentage of base salary is earned for each incremental level of the Company's
income before federal income tax until a higher preestablished amount is
achieved. Upon achievement of the higher preestablished amount, corporate
executives earn incentive bonuses at a higher percentage of base salary for each
incremental level of the Company's income before federal income tax above the
higher preestablished amount. In the case of division executives, no incentive
compensation is earned unless a certain operating profit is realized. Above
that amount the division executive earns an incentive bonus equal to a specified
percentage of base salary (and above a still higher amount, a higher specified
percentage of base salary) for each incremental level of operating profit above
the preestablished amount. In the case of both corporate and division
executives, the total amount of incentive compensation that may be earned in any
year is limited to a predetermined maximum percentage of base salary.
If the amount of the incentive bonus for the year would exceed a certain
percentage of the base salary, only a portion of the incentive compensation
amount (ranging from twenty-five percent (25%) in the case of some executives to
fifty percent (50%) in the case of other executives) is paid currently and the
balance is deferred and paid in equal installments within ninety (90) after
the close of each of the three (3) succeeding years. The unpaid deferred
portion will be forfeited if the executive leaves the employment of the
Company for any reason other than death, disability or retirement of the
executive or a change in control of the Company.
Stock Options and Deferred Compensation
The long term incentive element of the Company's management
compensation program is generally in the form of stock option grants. The
Committee intends to create an opportunity for officers and other key employees
of the Company to acquire a proprietary interest in the Company that aligns the
executive's interest with the interest of the Company's stockholders. Typically,
the Compensation Committee had granted incentive stock options in March of
each year. In March, 1993, however, the Compensation Committee was
continuing to review the effectiveness of incentive stock options and was
considering possible alternatives to incentive stock options that would make
those responsible for the planning and future growth of the Company long term
stockholders of the Company and that would mandate that their capital
accumulation opportunities be more closely identified with the stockholders of
the Company. A result of that review was the 1993 Stock Option and Incentive
Plan that was approved by the Board of Directors in April 1993 and by the
stockholders at the last Annual Meeting of the Stockholders. The Compensation
Committee made awards under its Executive Stock Ownership Program in April
1993 with respect to the preceding year's compensation and the Company
reported the awards in its Proxy Statement for last year's Annual Meeting of
Stockholders. The awards involved nonqualified stock options on a larger
number of shares than had typically been granted in previous years as incentive
stock options and provided for a ratable exercise over an eight year period
(instead of the usual five years)and also provided that the shares acquired upon
exercise would be subject to restrictions on transferability for periods after
exercise of five years (when restrictions would lapse on fifty percent of the
shares) and ten years (when restrictions would lapse on the other fifty percent
of the shares), except in the case of the death, disability or retirement or a
change in control of the Company or with the consent of the Compensation
Committee. The Compensation Committee has not awarded any stock options
since the options granted under the Executive Stock Ownership Program in April
of 1993.
Chief Executive Officer Compensation
The Chief Executive Officer's base salary, incentive compensation and
stock options are set within the philosophy and policies enunciated above for
all other executives of the Company.
During fiscal 1994, Mr. W. Ray Wallace, Chief Executive Officer of
the Company, participated in the same executive compensation plans as were
available to other executive officers of the Company. Based upon the
performance of the Company in the prior fiscal year, the positioning for future
years and the Compensation Committee's assessment of Mr. Wallace's past and
ongoing personal performance in the position of Chief Executive Officer, Mr.
Wallace received a 12.5% base salary increase effective April 1, 1993. The
Compensation Committee did not follow any set formula in making such
determination, but considered, among other things, the report of a nationally
recognized consulting firm employed to survey the compensation of chief
executive officers of other companies, with particular emphasis on companies
with a sales volume comparable to the Company.
Mr. Wallace also received incentive compensation under a formula that
if the Company's net income before taxes should exceed certain amounts, he
would receive a certain percentage of his base salary. Consequently, Mr.
Wallace earned an incentive bonus of $1,557,203 (based upon consolidated
income before taxes of $114,209,000 for the Company's fiscal year ended
March 31, 1994 versus consolidated income before taxes of $72,100,000 for the
preceding year). This incentive bonus is payable $450,000 currently, and the
balance of $1,107,203 is deferred and will be paid in three (3) equal annual
installments over the next three (3) years.
Mr. Wallace also has a long term deferred compensation plan with
respect to which the Company sets aside annually an amount equal to fifteen
percent (15%) of Mr. Wallace's combined salary and bonus in the year in which
paid. Mr. Wallace's long term deferred compensation for fiscal 1994 amounted
to $211,367. At March 31, 1994, the cumulative balance of the unfunded
deferred compensation, including the accrual of earnings thereon, was
$1,104,243.
Pursuant to an agreement between the Company and Mr. Wallace dated
July 18, 1990, the Company is obligated to supplement his pension plan and
other retirement benefits from the Company so that the aggregate amount of all
his retirement benefits from the Company will equal eighty percent (80%) of his
average annual compensation for the five consecutive years in which he was
most highly compensated by the Company. The Company would have paid to
him supplemental retirement benefits under this plan during fiscal 1994 in the
amount of $674,000 if he had not been actively employed by the Company on
a full-time basis. However, the salary and incentive compensation paid to Mr.
Wallace during the Company's fiscal year ended March 31, 1994 will increase
his annual supplemental retirement benefits to $767,000 upon actual retirement.
Dean P. Guerin, Chairman Ray J. Pulley, Member
Compensation Committee Jess T. Hay, Member
Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee is a current or former
officer or employee of the Company or any of its subsidiaries. Mr. W. Ray
Wallace serves on the Board of Directors and Audit Committee of Lomas
Financial Corporation, of which Mr. Hay, a director and member of the
Compensation Committee of the Company, is the Chairman and Chief Executive
Officer. He also serves on the Board of Directors of ENSERCH Corporation
and is a member of the Audit Committee and the Chairman of its Compensation
Committee, of which Mr. Biegler, a director, is the Chairman, President and
Chief Executive Officer. The members of the Board of Directors of each of the
respective corporations have been fully informed of these relationships.
Performance Graph
The following graph shows a comparison of the five (5) year cumulative
return (assuming reinvestment of any dividends) for the Company, the New
York Stock Exchange Index and the Dow Jones Transportation Equipment
Index.(1)
* The following graph was originally excluded from the form type PRE 14A
document submitted by Trinity on Friday, May 20, 1994.
FIVE YEAR CUMULATIVE TOTAL RETURN
_____________________________________________________________________
|
200 |____________________________________________________________________
| T
180 |____________________________________________________________________
| N N
160 |____________________________________________________________________
| N T D
140 |____________________________________________________________________
| N D
120 |____________________________________________________________________
| N D
100 |___TDN______________________________________________________________
| D D T
80 |________________T___________T_______________________________________
|
60 |____________________________________________________________________
1989 1990 1991 1992 1993 1994
--------------------------------------------------------------------
T 100 | 83 | 83 | 96 | 153 | 194 |
D 100 | 89 | 86 | 112 | 135 | 155 |
N 100 | 116 | 132 | 145 | 166 | 173 |
--------------------------------------------------------------------
T = Trinity Industries, Inc.
D = Dow Jones Transportation Equipment
N = New York Stock Exchange Index
0(1) The sources for the information contained in this table in respect to
the return for the Company and for the Dow Jones Transportation Index
are STAR Services, Inc. and, in respect to the New York Stock
Exchange Index, is Media General Financial Services.
<PAGE>
_____________
Certain Transactions
The Company, during its fiscal year ended March 31, 1994, had
revenues of $254,518, and purchases of $12,444,526, from Trinity Industries de
Mexico, S.A. de C.V. (formerly Cabezas Acero Kikapoo, S.A. and herein
called "Trinity de Mexico"). The Company owns forty nine percent (49%) of
Trinity de Mexico and Mr. W. Ray Wallace, Chairman, President and Chief
Executive Officer of the Company, owns thirty seven percent (37%) of the
company that owns the remaining fifty one percent (51%) of Trinity de Mexico.
ITEM 2 - APPROVAL OF THE COMPANY'S INCENTIVE BONUS
PLAN
FOR SELECTED EXECUTIVES
At the 1994 Annual Meeting, the stockholders also will be asked to
consider and vote upon a proposal, submitted by the Compensation Committed
of the Board of Directors, to approve the Trinity Industries, Inc. Annual
Incentive Bonus Plan for Designated Executives (the "Bonus Plan"). This proposal
is being submitted to stockholders for their approval in order to ensure
that incentive bonus payments otherwise meeting the requisites of "performance
based" compensation under Internal Revenue Code Section 162(m) will not be
disallowed as a deduction to the Company for federal income tax purposes. The
Bonus Plan is essentially the same as the bonus arrangement which the Company
has followed for a number of years in determining the annual incentive bonuses
earned by its senior officers.
Internal Revenue Code Section 162(m) disallows a tax deduction to a
publicly held corporation for any compensation (with certain exceptions) in
excess of One Million Dollars ($1,000,000) paid to any person who is its chief
executive officer or among its four (4) most highly compensated executive
officers (other than the chief executive officer) whose compensation must be
reported to stockholders under the Securities Exchange Act of 1934, as
amended. An exception is made, however, for remuneration that qualifies as
"performance-based" compensation."Performance-based" compensation is not counted
for purposes of this limitation on the deductibility of compensation paid
to the chief executive officer or the other four (4) most highly compensated
executives. Compensation payable solely on account of the attainment of one or
more performance goals will be considered "performance-based" compensation
if (1) the performance goals are determined by a compensation committee of the
Board of Directors which is comprised solely of two or more outside directors,
(2) the material terms under which the remuneration is paid, including
performance goals, are disclosed to the stockholders and are approved by a
majority vote in a separate stockholder vote before the payment of such
remuneration, and (3) before the payment of such remuneration, the
compensation committee certifies that the performance goals and other material
terms were in fact satisfied.
Summary of the Incentive Bonus Plan
Administration of Plan. The Bonus Plan is administered by a
committee appointed by the Board of Directors comprised solely of two or more
outside directors of the Company. Currently, the Bonus Plan is administered by
the Compensation Committee, which is composed entirely of three outside
directors.
Plan Year. The plan year is the Company's fiscal year which ends
March 31 of each year.
Eligibility. Participation in the Bonus Plan is limited to full-time
employees of the Company or one of its subsidiaries who are selected to
participate in the Bonus Plan by reason of their position of significant
responsibility in the overall operations of the corporate enterprise or in the
operations of one or more of its Company's divisions or business segments. The
Compensation Committee selects, prior to the beginning of each plan year, the
persons who shall participate in the Bonus Plan for the plan year.
Bonus Formula. The measure for determining whether the Company
shall pay annual incentive bonuses under the Bonus Plan to persons selected by
the Compensation Committee to participate in the Bonus Plan is the attainment
by the Company for the plan year of a certain level (determined for each plan
year by the Compensation Committee) of income before federal income tax of
the Company and its subsidiaries (in the case of persons who hold positions of
significant responsibility for the overall operations of the Company, i.e., the
corporate executives) or operating profit in one or more divisions or business
segments(in the case of persons who hold positions of significant responsibility
for the operations of one or more divisions or business segments of the
Company, i.e., division executives). The Compensation Committee determines
for each participant for each plan year that an amount equal to specified
percentages (which are predetermined by the Compensation Committee) of the part-
icipant's base salary will be earned by the participant as an incentive bonus
for the plan year if, in the case of a corporate executive, the Company achieves
certain levels (as predetermined by the Compensation Committee) of income before
federal income tax, or in the case of a division executive, operating profit
for one or more particular divisions or business segments. If the Company fails
to earn for the plan year a specified minimum level (predetermined by the
Compensation Committee) of income before federal income tax (in the case of
the corporate executive) or operating profit (in the case of a division
executive),
no incentive bonus will be paid to the participant. The Compensation Committee
also determines a maximum percentage of the participant's base salary that will
serve as a ceiling on the amount of incentive bonus that a participant may earn
for the plan year, which in no event shall exceed two hundred percent (200%) of
the participant's base salary. The base salary used for all these calculations
is the base salary for the participant for the plan year as determined by the
Compensation Committee at the beginning of the plan year.
Manner of Payment. The amount of incentive bonus earned by a participant
for the plan year is payable in cash after the close of the plan year
but the Compensation Committee is given the discretion to defer the payment of a
portion of the incentive bonus to one or more later years. Generally, the
Compensation Committee requires that the incentive bonus amounts above fifty
percent (50%) of base salary be deferred and be payable in three equal annual
installments on June 30, of each year after succeeding plan year. The deferred
portion is forfeited if the executive leaves the employment of the Company for
any reason other than his death, disability, or retirement or as a result of a
change in control of the Company.
There is no obligation on the Company for uniformity of treatment
among participants. Neither the approval of the Bonus Plan by the stockholders
nor any action taken under the Bonus Plan gives to any participant the right to
be retained in the employ of the Company or any of its subsidiaries.
Termination and Amendment. The Board of Directors may terminate
the Bonus Plan at any time or prospectively amend or modify the Bonus Plan.
Shareholder Approval. The Board of Directors deems it to be in the
best interests of the Company and its stockholders to preserve, insofar as
possible, the Company's tax deduction for compensation in excess of One
Million Dollars ($1,000,000), if any, paid to its executive officers, and
therefore, recommends a vote FOR approval by the stockholders of the Bonus Plan.
If stockholders do not approve the Bonus Plan by a majority vote of shares
present or represented and entitled to vote at the Annual Meeting, no bonuses
will be paid under the Bonus Plan.
The amount of the incentive bonuses that will be paid to each of the five
(5) executives named in the Summary Compensation Table above cannot be
determined at this time since the amount of each incentive bonus will depend, in
the case of two of those executives, upon the income before federal income tax
of the Company and its subsidiaries for the year ending March 31, 1995, and,
in the case of the other three executives, upon the operating profit for the
same period of the several divisions or business segments over which they,
respectively, have operating responsibility. However, the Summary
Compensation Table reflects the incentive bonuses paid to each of the five named
executives for the years ending March 31, 1994, 1993 and 1992 under a bonus
arrangement in effect for those years that was essentially the same as the Bonus
Plan that the stockholders will be asked to approve at the Annual Meeting of
Stockholders. For the Company's tax year ending March 31, 1995, only the
compensation of Mr. W. Ray Wallace, Chairman, President and Chief Executive
Officer of the Company, is expected to exceed the One Million Dollar
($1,000,000) limit on deductibility under Section 162(m) of the Internal Revenue
Code.
RELATIONSHIP WITH INDEPENDENT AUDITORS
Ernst & Young, independent auditors, or a predecessor of that firm,
have been the auditors of the accounts of the Company each year since 1958,
including the fiscal year ended March 31, 1994. It is anticipated that
representatives of Ernst & Young will be present at the 1994 Annual Meeting,
will have the opportunity to make a statement if they so desire and will be
available to respond to appropriate questions raised at the 1994 Annual Meeting
or submitted to them in writing before the 1994 Annual Meeting.
Ernst & Young has informed the Company that it does not have any
direct financial interest in the Company and that it has not had any direct
connection with the Company in the capacity of promoter, underwriter, director,
officer or employee.
As is customary, auditors for the current fiscal year will be appointed
by the Board of Directors at their meeting immediately following the 1994
Annual Meeting upon recommendation of the Audit Committee.
STOCKHOLDER PROPOSALS
Stockholders' proposals to be presented at the 1995 Annual Meeting of
Stockholders, for inclusion in the Company's Proxy Statement and form of proxy
relating to the meeting, must be received by the Company at its offices in
Dallas, Texas, addressed to the Secretary of the Company, not later than
February 14, 1995.
OTHER MATTERS
Management of the Company is not aware of other matters to be
presented for action at the 1994 Annual Meeting; however, if any such other
matters are presented for action, it is the intention of the persons named in
the accompanying form of proxy to vote in accordance with their judgment on
such matters.
It is important that proxies be returned promptly to avoid unnecessary
expense. Therefore, stockholders are urged, regardless of the number of shares
owned, to date, sign and return the enclosed proxy in the enclosed business
reply envelope.
By Order of the Board of
Directors
J. J. FRENCH, JR.
Secretary
June 9, 1994
Upon written request from any stockholder of record at May 27,
1994 (or any beneficial owner representing that he is or was entitled to vote
at the 1994 Annual Meeting), the Company will furnish to such stockholder,
without charge, its Annual Report on Form 10-K for the fiscal year ended
March 31, 1994, as filed with the Securities and Exchange Commission,
including financial statements. The Company may impose a reasonable fee
for its expenses in connection with providing exhibits referred to in such
Form 10-K, if the full text of such exhibits is specifically requested.
Requests should be directed to: Mr. F. Dean Phelps, Jr., Vice President,
Trinity Industries, Inc., P. O. Box 568887, Dallas, Texas 75356-8887.
<PAGE>
[FRONT SIDE OF PROXY CARD]
TRINITY INDUSTRIES, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS - July 20, 1994
The undersigned hereby appoints J. J. French, Jr., W. Ray
Wallace and Dean P. Guerin and each of them with full power of
substitution, attorneys, agents and proxies of the undersigned to vote
as directed below the shares of stock which the undersigned would
be entitled to vote, if personally present, at the Annual Meeting of
Stockholders of Trinity Industries, Inc. to be held in the Auditorium
of Lomas Financial Corporation, 35th Floor, 2001 Bryan Tower,
2001 Bryan Street, Dallas, Texas 75201, on Wednesday, July 20,
1994 at 9:30 a.m. Central Daylight Saving Time and at any
adjournment or adjournments thereof. If more than one of the above
attorneys shall be present in person or by substitution at such meeting
or at any adjournment thereof, the majority of said attorneys so
present and voting, either in person or by substitution, shall exercise
all of the powers hereby given. The undersigned hereby revokes any
proxy or proxies heretofore given to vote upon or act with respect to
such shares of stock and hereby ratifies and confirms all that said
attorneys, their substitutes, or any of them, may lawfully do by virtue
hereof.
(1) Election of eight (8) Directors: David W. Biegler,
Barry J. Galt, Dean P. Guerin, Jess T. Hay, Edmund M. Hoffman,
Ray J. Pulley, Timothy R. Wallace and W. Ray Wallace.
___
/___/ FOR all nominees listed above (except as marked to
the contrary)
___
/___/ WITHHOLD AUTHORITY to vote for all nominees
listed above
INSTRUCTION: To withhold authority to vote for one
or more, but not all, of the above-named nominees, check the
box before "FOR" and indicate your desire to withhold such
authority by drawing a line through the name(s) of such
nominee(s).
(2) In respect to the approval of the Annual Incentive
Bonus Plan for Selected Executives.
___
/___/ FOR approval of the Plan
___
/___/ AGAINST approval of the Plan
(3) In their discretion on such other matters as may
properly come before the meeting.
<PAGE>
[BACK SIDE OF PROXY CARD]
(Continued from other side)
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR EACH OF THE ABOVE NAMED NOMINEES FOR DIRECTOR AND FOR APPROVAL OF THE
TRINITY INDUSTRIES, INC. 1994 STOCK OPTION AND INCENTIVE PLAN.
Date Signed: _____________________________
Signature(s): _____________________________
_____________________________
Please sign exactly as your name
appears on the proxy. If your
stock is jointly owned, both
parties must sign. Fiduciaries and
representatives should so indicate
when signing, and when more than
one is named, a majority should
sign. If signed by a corporation, its
seal should be affixed.
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.
NO POSTAGE IS REQUIRED.
