<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
</TABLE>
TRINITY INDUSTRIES, INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
TRINITY INDUSTRIES, INC.
2525 STEMMONS FREEWAY
DALLAS, TEXAS 75207-2401
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JULY 19, 2000
Notice is hereby given that the Annual Meeting of Stockholders of
Trinity Industries, Inc. (the "Company"), a Delaware corporation, will be held
at the offices of the Company, 2525 Stemmons Freeway, Dallas, Texas 75207, on
Wednesday, July 19, 2000, at 9:30 a.m., Central Daylight Saving Time, for the
following purposes:
(1) to elect ten (10) directors to hold office until the next Annual
Meeting of Stockholders or until their successors are elected and qualified;
(2) to approve the Trinity Industries Short Term Management Incentive
Plan;
(3) to approve ratification of Ernst & Young LLP as independent
auditors for fiscal year 2001;
(4) to vote on a stockholder proposal, if properly presented at the
meeting, requesting the Board of Directors to arrange for the prompt sale of the
Company to the highest bidder; and
(5) 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 26, 2000
will be entitled to notice of and to vote at the 2000 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 2000 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 2000 Annual Meeting, whether or not you expect to attend in
person. Stockholders who attend the 2000 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 for the fiscal year ended March 31, 2000 accompany this
Notice of Annual Meeting of Stockholders.
By Order of the Board of Directors
MICHAEL G. FORTADO
Vice President, General Counsel
and Corporate Secretary
June 19, 2000
<PAGE> 3
TRINITY INDUSTRIES, INC.
2525 STEMMONS FREEWAY
DALLAS, TEXAS 75207-2401
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JULY 19, 2000
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 at the offices of the Company, 2525
Stemmons Freeway, Dallas, Texas, on Wednesday, July 19, 2000, at 9:30 a.m.,
Central Daylight Saving Time (the "2000 Annual Meeting"), or at any adjournment
thereof, for the purposes set forth in the accompanying Notice of Annual Meeting
of Stockholders. The Company's mailing address is P.O. Box 568887, Dallas,
Texas, 75356-8887.
This Proxy Statement and the enclosed form of proxy are being mailed to
stockholders on or about June 19, 2000.
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 2000 Annual
Meeting, by executing a proxy bearing a later date or by attending the 2000
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
2000 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 ten (10) 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 Trinity Industries Short Term Management
Incentive Program;
(3) FOR the approval of Ernst & Young as independent auditors for
fiscal year 2001;
(4) AGAINST the stockholder proposal requesting the Board of Directors
to arrange for the prompt sale of the Company to the highest bidder; and
(5) At the discretion of the persons named in the enclosed form of
proxy, on any other matter that may properly come before the 2000 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
2000 Annual Meeting, including the cost of mailing, will be borne by the
Company. To the extent necessary to assure sufficient representation at the 2000
Annual Meeting, officers and regular employees of the Company, at no additional
compensation, may request the return of proxies personally, by telephone,
facsimile, mail, or other method. The extent to which this will be necessary
depends entirely upon how
<PAGE> 4
promptly proxies are received. Stockholders are urged to send in their proxies
without delay. The Company has retained Georgeson Shareholder Communications
Inc. to assist with the solicitation of proxies for a fee of $8,500, plus
reimbursement for out-of-pocket expenses. The Company will supply brokers,
nominees, fiduciaries and other custodians with proxy materials to forward to
beneficial owners of shares in connection with this solicitation, 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 2000 Annual Meeting, or
any adjournment thereof, has been established by the Board of Directors as of
the close of business on May 26, 2000. At that date, there were outstanding and
entitled to vote 38,104,166 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 2000 Annual
Meeting, but if a quorum should not be present, the meeting may be adjourned
from time to time until a quorum is obtained. 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.
The proxy card provides space for a stockholder to withhold voting for
any or all nominees for the Board of Directors. The election of directors
requires a plurality of the votes cast at the meeting. Each of the other matters
being submitted to the stockholders requires the affirmative vote of a majority
of the shares present in person or represented by proxy and entitled to vote at
the meeting. Shares of a stockholder who abstains from voting on any or all
proposals will be included for the purpose of determining the presence of a
quorum. However, an abstention with respect to the election of the Company's
directors will not be counted either in favor of or against the election of the
nominees. In the case of the other proposals which are being submitted for
stockholder approval, an abstention will effectively count as a vote cast
against such proposal. Broker non-votes on any matter, as to which the broker
has indicated on the proxy that it does not have discretionary authority to
vote, will be treated as shares not entitled to vote with respect to that
matter. However, such shares will be considered present and entitled to vote for
quorum purposes so long as they are entitled to vote on other matters.
At May 26, 2000, the companies named below were the only persons known
by the Company to be beneficial owner of more than 5% of its Common Stock:
<TABLE>
<CAPTION>
NAME AND ADDRESS NUMBER OF SHARES PERCENT OF
OF BENEFICIAL OWNER BENEFICIALLY OWNED CLASS
--------------------------- ------------------ -----------
<S> <C> <C>
Pioneer Investment Inc. (1) 3,947,600 10.3%
60 State Street
Boston, Massachusetts 02109
Private Capital Management, Inc. (2) 4,149,917 10.9%
3003 Tamiami Trail North
Naples, Florida 34103
</TABLE>
----------
(1) Pioneer Investment Inc. reported sole voting and dispositive power as to
3,947,600 shares. This information is based solely on a Schedule 13G
containing information as of January 3, 2000.
(2) Private Capital Management, Inc. has advised the Company it is an
institutional investment manager with shared voting and dispositive power
as to 4,149,917 shares on May 26, 2000.
2
<PAGE> 5
The following table shows the number of shares of Common Stock as of May
26, 2000 beneficially owned by each director or nominee, by the named
executive officers and by all directors and executive officers as a group,
based upon information supplied by them:
<TABLE>
<CAPTION>
NUMBER OF SHARES EXERCISABLE
BENEFICIALLY OWNED OPTIONS PERCENT OF
NAME AT MAY 26, 2000(1) INCLUDED CLASS
--------------- ------------------ -------- -----
<S> <C> <C> <C>
John L. Adams 64,556 19,896 *
David W. Biegler 29,010 27,410 *
Ronald J. Gafford 12,702 12,500 *
Barry J. Galt 23,000 18,000 *
Clifford J. Grum 26,646(2) 23,646 *
Dean P. Guerin 75,410 18,000 *
Jess T. Hay 21,384(3) 18,000 *
Edmund M. Hoffman 59,681(4) 18,000 *
Jim S. Ivy 41,140 23,751 *
Diana S. Natalicio 27,146 23,646 *
John R. Nussrallah 46,007 31,076 *
Mark W. Stiles 68,044 46,070 *
Timothy R. Wallace 321,759(5) 176,958 *
W. Ray Wallace 1,175,439(6) 506,590 3%
Directors and Executive
Officers as a Group 2,128,791 1,024,311 5.5%
</TABLE>
--------
* 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 May
26, 2000 or within sixty (60) days thereafter which are included and shown
in the next column and vested common stock equivalent units credited to
executives under the Supplemental Profit Sharing Plan for Mr. Adams 6,660;
Mr. Ivy 4,662; Mr. Nussrallah 6,253; Mr. Stiles 8,869; Mr. Timothy R.
Wallace 24,392 and all executive officers as a group 68,007. Includes
shares indirectly held through the Company's 401(k) Plan for Mr. Ivy 727;
Mr. Nussrallah 548; Mr. Timothy R. Wallace 1,065 and all executive officers
as a group 3,135 shares.
(2) Includes 3,000 shares owned by Deerfield Corporation of which Mr. Grum is
an owner.
(3) Includes 384 shares owned of record by Mr. Hay's wife as custodian for
their daughter in which Mr. Hay disclaims beneficial ownership.
(4) Includes 1,500 shares held by Mr. Hoffman as trustee of a trust in which
Mr. Hoffman disclaims beneficial ownership.
(5) Includes 91,063 shares held indirectly by a limited partnership which Mr.
Wallace controls.
(6) Includes 455,678 shares held indirectly by limited partnerships which Mr.
Wallace controls.
The Company has adopted a stock ownership policy for directors and
officers that is designed to align the financial interest of directors and
officers with those of the Company's stockholders. The policy establishes a
minimum amount of stock that directors and officers are expected to own by the
end of a five year period. For the Chief Executive Officer the amount is five
times base salary, for the other named executives it is three times base
3
<PAGE> 6
salary and for the directors it is three times the annual retainer. Stock units
are included in this calculation because they are subject to the same market
risk as is common stock. Directors who defer their fees may elect for their fees
to be credited to an account on the books of the Company and are reflected in
the table below. All matching amounts in the Company's Supplemental Profit
Sharing Plan for executives are made in stock units and vest over time. Vested
amounts are reflected in the stock ownership table above and unvested amounts
are provided in the table below for the named executive officers:
<TABLE>
<CAPTION>
Directors Executives
<S> <C> <C> <C>
David W. Biegler 3,352 Timothy R. Wallace 281
Ronald J. Gafford 592 John L. Adams 378
Barry J. Galt 5,332 Jim S. Ivy 517
Clifford J. Grum 4,132 John R. Nussrallah 129
Dean P. Guerin 5,726 Mark W. Stiles 112
Diana Natalicio 3,922
Timothy R. Wallace 1,052
</TABLE>
ELECTION OF DIRECTORS
At the 2000 Annual Meeting, ten (10) 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 ten
(10) 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 following biographical information sets forth the name, age,
principal occupation or employment during the past five years, Board committee
membership, certain other directorships held by each nominee for director, the
period during which he or she has served as a director of the Company, and
certain family relationships.
THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE FOR THE ELECTION OF EACH OF
THE TEN (10) NOMINEES TO THE BOARD OF DIRECTORS SET FORTH BELOW.
NOMINEES
TIMOTHY R. WALLACE (46)
Director since 1992. Mr. Wallace is Chairman, President and Chief Executive
Officer of the Company. He is the son of Mr. W. Ray Wallace, a director of
the Company. Mr. Wallace is a director of Viad Corp. which is primarily
involved in travel, trade exhibits and financial services.
DAVID W. BIEGLER (53)
Director since 1992. Chairman of the Corporate Governance and Nominating
Committee and a member of the Human Resources Committee. Mr. Biegler has
served since August 1997 as President and Chief Operating Officer of TXU
Corp., a public utility holding company providing electric and natural gas
utility services, energy marketing and other energy-related services.
Previously thereto he served as the Chairman, President and Chief Executive
Officer of ENSERCH Corporation, an integrated natural gas company. He is an
advisory director of Chase Bank of Texas, National Association, a national
bank.
4
<PAGE> 7
RONALD J. GAFFORD (50)
Director since 1999. Member of the Corporate Governance and Directors
Nominating Committee and of the Human Resources Committee. Mr. Gafford has
served since March of 1996 as President of Austin Industries, Inc., a
civil, commercial and industrial construction company, and in the eight
preceding years served in various executive capacities for subsidiaries of
Austin Industries, Inc.
BARRY J. GALT (66)
Director since 1988. Member of the Audit Committee and of the Corporate
Development and Finance Committee. Mr. Galt is a director, and prior to his
retirement on March 30, 1999, served as Chairman and Chief Executive
Officer of Ocean Energy, Inc., formerly named Seagull Energy Corporation, a
diversified energy company engaged in oil and gas exploration and
development. He is also a director of Friede Goldman Halter, Inc., a
director of StanCorp Financial Group, Inc., an insurance company, and a
Houston area advisory director of Chase Bank of Texas, National
Association, a national bank.
CLIFFORD J. GRUM (65)
Director since 1995. Chairman of the Audit Committee and a member of the
Human Resources Committee. Mr. Grum is the retired Chairman and Chief
Executive Officer of Temple-Inland, Inc., a holding company with interests
in corrugated containers, bleached paperboard, building products, timber
and timberlands, and financial services. He is also a director of Cooper
Industries, Inc., a company engaged in the businesses of electrical
products, tools and hardware, and automotive products and a director of
Tupperware Corporation, a multinational consumer products company.
DEAN P. GUERIN (78)
Director since 1965. Chairman of the Corporate Development and Finance
Committee and a member of the Corporate Governance and Nominating Committee
and Audit Committee. Mr. Guerin's principal occupation is investments.
JESS T. HAY (69)
Director since 1965. Chairman of the Human Resources Committee and member
of the Corporate Governance and Nominating Committee. Mr. Hay is Chairman
of HCB Enterprises, Inc., a private investment firm. He is also Chairman of
the Texas Foundation for Higher Education. For 29 years prior to his
retirement on December 31, 1994, Mr. Hay was Chief Executive Officer of the
Lomas Financial Group, a diversified financial services institution engaged
principally in mortgage banking and real estate lending. Mr. Hay is a
director of Viad Corp. which is primarily involved in travel, trade
exhibits, and financial services, a director of Exxon Mobil Corporation, a
diversified energy company engaged principally in the exploration,
production and marketing of petroleum products, and a director of SBC
Communications, Inc., a telephone and wireless communications company.
EDMUND M. HOFFMAN (78)
Director since 1957. Member of the Audit Committee and the Corporate
Development and Finance Committee. Mr. Hoffman's principal occupation is
investments.
5
<PAGE> 8
DIANA S. NATALICIO (60)
Director since 1996. Member of the Human Resources Committee and of the
Corporate Governance and Nominating Committee. President of the University
of Texas at El Paso. She is an advisory director of the Chase Bank of
Texas, National Association, a national bank. Dr. Natalicio was appointed
by President Bush to the Commission on Educational Excellence for Hispanic
Americans and by President Clinton to the National Science Board and to the
President's Committee on the Arts and Humanities.
W. RAY WALLACE (77)
Director since 1958. Retired as Chairman and Chief Executive Officer of the
Company in December 1998. Member of the Corporate Development and Finance
Committee. He is the father of Timothy R. Wallace, Chairman, President and
Chief Executive Officer of the Company.
BOARD MEETINGS AND COMMITTEES
The directors hold regular quarterly meetings in addition to a meeting
immediately following the Annual Meeting of Stockholders, attend special
meetings and committee meetings as required, and spend such time on the affairs
of the Company as their duties require. During the fiscal year ended March 31,
2000, the Board of Directors held six (6) meetings and all directors of the
Company attended at least seventy-five percent (75%) of the meetings of the
Board of Directors and the committees on which they served.
The standing committees of the Board of Directors are the Audit
Committee, Human Resources Committee, Corporate Governance and Nominating
Committee, and Corporate Development and Finance Committee.
The Audit Committee consists of Messrs. Galt, Grum, Guerin and Hoffman.
The Audit Committee reviews with management, the director of internal auditing,
and the independent accountants the Company's financial statements, the
accounting principles applied in their preparation, the scope of the audit, any
comments made by the independent accountants upon the financial condition of the
Company and its accounting controls and procedures, and such other matters as
the Audit Committee deems appropriate including reviews with management relating
to compliance with corporate policies, compliance programs, and internal
controls. The Audit Committee also recommends to the Board of Directors the
independent accountant for the Company and reviews audit fees. The Audit
Committee met three (3) times during the fiscal year ended March 31, 2000.
The Human Resources Committee consists of Messrs. Biegler, Gafford,
Grum, Hay and Dr. Natalicio. The duties of the Human Resources Committee
generally are to determine and/or recommend the compensation structure for the
Company and its subsidiaries; make recommendations to the Board of Directors as
to the salary of the Chief Executive Officer, and set the salaries of other
senior executives of the Company; grant options, shares of stock, stock units
and such other benefits as may be permitted under the Company's stock related
benefit plans; design and recommend to the Board for approval and administer
long, intermediate and short-term incentive compensation plans of the Company.
The Human Resources Committee met six (6) times during the fiscal year ended
March 31, 2000.
The Corporate Governance and Nominating Committee consists of Messrs.
Biegler, Gafford, Guerin, Hay and Dr. Natalicio. The duties of the Corporate
Governance and Nominating Committee generally are to recommend to the Board of
Directors the director nominees proposed each year in the Company's proxy
statement for election by the Company's stockholders; review the qualifications
of, and recommend to the Board, candidates to fill Board vacancies as they may
occur; consider suggestions from stockholders and other sources regarding
possible candidates for director; define and recommend to the Board appropriate
guidelines and criteria regarding the qualifications of candidates for director
of the Company; review and propose changes, when appropriate, in the
compensation and benefits of non-employee directors of the Company; and review
the Company's Corporate Governance Principles.
6
<PAGE> 9
The Corporate Governance and Nominating Committee met three (3) times during the
fiscal year ended March 31, 2000.
The Corporate Development and Finance Committee consists of Messrs.
Galt, Guerin, Hoffman, and W. Ray Wallace. The duties of the Corporate
Development and Finance Committee generally are to provide direction for the
assessment of future acquisition opportunities; review specific plans regarding
significant acquisitions or dispositions of businesses or assets; authorize,
subject to limits imposed by the Board of Directors, investments in or
acquisition of another company; and periodically review the financial status of
the Company. The Corporate Development and Finance Committee did not meet during
the fiscal year ended March 31, 2000.
COMPENSATION OF DIRECTORS
Directors are compensated at the rate of $1,250 for each board or
committee meeting attended plus 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 $35,000 per year
for serving as a director, and the Chairman of each of the committees receives
an additional $3,500 per year. Directors may elect, pursuant to a Deferred Plan
for Director Fees, to defer the receipt of all or a specified portion of the
fees to be paid to him or her. Deferred amounts are credited to an account on
the books of the Company and treated as if invested either at the prime rate of
interest as announced from time to time by Chase Bank of Texas or, at the
director's prior election, in units of the Company's Common Stock at the closing
price on the New York Stock Exchange on the date that a payment is credited to
the director's account. Such stock units are credited with amounts equivalent to
dividends paid on the Company's Common Stock. Upon ceasing to serve as a
director, the value of the account will be paid to the director in annual
installments not exceeding ten (10) years according to the director's prior
election.
Annually, each director who is not also an executive officer of the
Company is granted an option to purchase 5,000 shares of the Company's Common
Stock at the fair market value of the Company's Common Stock on the date of
grant.
The Company has a Directors' Retirement Plan that is an unfunded
arrangement whereby members of the Board of Directors who are not employees of
the Company will receive monthly payments for a ten (10) year period upon
retirement, disability or death. 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 (10)
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 a change in control of the Company (as defined).
Commencing January 1, 1999, Mr. W. Ray Wallace was employed by the
Company as a consultant pursuant to an agreement at a monthly rate of $10,000.
The agreement provides for the performance of services as may be required by the
Chief Executive Officer or the Board of Directors and his continuation as a
director as long as he is eligible. He is provided an office, administrative
assistant, limited use of Company aircraft and reimbursement of expenses. In
addition, the Company will provide medical coverage for the remainder of his
life.
7
<PAGE> 10
EXECUTIVE COMPENSATION AND OTHER MATTERS
The following table sets forth information for the Company's fiscal
years ended March 31, 2000, 1999, and 1998, with regard to the compensation for
their services to the Company and its subsidiaries in all capacities of the
Chief Executive Officers and each of the other four (4) most highly compensated
executive officers serving the Company at the close of the Company's most
recently completed fiscal year.
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
-------------------------------------- -------------------------
Other Restricted Securities
Annual Stock Underlying All Other
Name and Compensation Awards Options Compensation
Principal Position(1) Year Salary ($) Bonus ($) ($)(2) ($)(3) (#)(4) ($)(5)
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Timothy R. Wallace 2000 $700,000 $1,029,150 $ 7,500 $279,375 151,852 $230,515
Chairman, President & 1999 600,000 945,000 21,373 393,125 63,574 159,300
Chief Executive Officer 1998 550,000 791,549 12,500 265,000 49,344 139,756
John L. Adams 2000 $450,000 $ 402,750 - 0 - $111,750 40,000 $ 98,162
Executive Vice President 1999 87,500 87,281 $ 4,162 150,750 25,000 - 0 -
Mark W. Stiles 2000 $352,000 $ 391,818 $ 20,025 $ 69,844 30,000 $101,668
Senior Vice President 1999 325,000 406,250 11,707 58,969 19,901 77,925
1998 315,000 263,813 - 0 - 53,000 12,908 62,927
John R. Nussrallah 2000 $370,000 $ 279,720 $ 17,728 $ 83,813 30,000 $ 24,249
President, Railcar Group 1999 330,000 264,000 14,136 78,625 20,000 3,840
1998 275,000 200,000 - 0 - 79,500 10,000 3,360
Jim S. Ivy 2000 $343,000 $ 245,588 $ 18,858 $ 55,875 20,000 $ 75,026
Vice President and Chief 1999 330,000 219,450 14,136 78,625 20,000 57,345
Financial Officer 1998 50,000 5,000 - 0 - 106,000 42,500 5,500
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Mr. John L. Adams joined the Company in January of 1999.
(2) Other annual compensation for fiscal 2000 is composed of amounts
reimbursed for the payment of taxes for certain perquisites for Messrs.
Stiles, Nussrallah and Ivy; and, in the case of Mr. Wallace, directors'
meeting fees.
(3) Amounts shown for each year are based on the closing price of the
Common Stock on the date of grant. Messrs. Wallace, Adams, Stiles,
Nussrallah and Ivy had restricted shares totaling 28,000, 8,000, 7,000,
8,000, and 6,000 shares, respectively, as of March 31, 2000 with a
market value of $663,250, $189,500, $165,813, $189,500, and $142,125,
respectively, based on a $23.6875 per share market price of the
Company's Common Stock on that date. Dividends are paid on these
restricted shares at the same rate as paid on the Company's Common
Stock. The restrictions on transferability will be lifted upon the
recipient's retirement at age 65 or earlier with the consent of the
Human Resources Committee, death or disability, or upon a change in
control of the Company. If the employment of the recipient is
terminated without the consent of the Human Resources Committee for any
reason other than death or disability prior to the recipient's
retirement, then the restricted shares will be forfeited.
8
<PAGE> 11
(4) Includes reload grants.
(5) All other compensation for fiscal 2000 is composed of the Company's
matching amounts under the Company's Supplemental Profit Sharing Plan
and Section 401(k) Plan (described below under "Retirement Plans") for
Mr. Wallace $57,600; Mr. Adams $12,887; Mr. Stiles $27,287; Mr.
Nussrallah $24,249 and Mr. Ivy $16,168; and an amount equal to ten
percent (10%) of the salaries and incentive bonuses set aside pursuant
to long-term deferred compensation plans for Mr. Wallace $172,915; Mr.
Adams $85,275; Mr. Stiles $74,381 and Mr. Ivy $58,858.
Option Grants In Last Fiscal Year
<TABLE>
<CAPTION>
Potential Realizable Value
at Assumed Annual
Rates of Stock Price
Individual Grants Appreciation for Option Term ($)
----------------------------------------------------------------------- ----------------------------------------
Number of
Securities
Underlying Percent
Options of Total Exercise or
Granted Options Base Price Expiration
Name (#)(1) Granted ($/Sh) Date 5% ($) 10% ($)
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Timothy R. Wallace 80,000(2) 13.4% 29.4375 10/29/09 1,481,047 3,753,263
11,286(3) 1.9% 36.0625 04/13/03 62,408 157,906
60,566(3) 10.1% 32.2500 04/13/03 384,704 832,162
John L. Adams 40,000(2) 6.7% 29.4375 10/29/09 740,523 1,876,632
Mark W. Stiles 30,000(2) 5.1% 29.4375 10/29/09 555,393 1,407,474
John R. Nussrallah 30,000(2) 5.1% 29.4375 10/29/09 555,393 1,407,474
Jim S. Ivy 20,000(2) 3.4% 29.4375 10/29/09 370,262 938,316
--------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Company has not granted any stock appreciation rights.
(2) Annual grants of stock options at the market price on the date of grant
which vest 25% each year.
(3) Reload grants made to participants who exercised nonqualified stock
options pursuant to an Executive Stock Purchase Program ("ESPP") who
paid the purchase price using shares of previously owned shares of the
Company's Common Stock. The Reload grant is for the number of shares
equal to the shares utilized in payment of the purchase price. The
option price for the reload option is equal to the market value of the
Company's Common Stock on the date of the exercise of the primary
option and the option period is equal to the remaining period of the
options exercised. The participant may not exercise a reload option
earlier than six months from the date it is granted.
9
<PAGE> 12
Aggregated Option Exercises In Last Fiscal Year
And Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Value of
Securities Underlying Unexercised
Unexercised In-the-Money
Options at Fiscal Options at Fiscal
Year-End Year-End
Shares
Acquired on Value Exercisable/ Exercisable/
Exercise Realized Unexercisable Unexercisable
Name (#) ($) (#) ($)
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Timothy R. Wallace 111,072 1,294,817 153,433 -
217,142 114,684
John L. Adams - - 18,896 -
- - 65,514 -
Mark W. Stiles - - 41,365 21,287
60,937 22,937
John R. Nussrallah - - 31,076 -
61,776 -
Jim S. Ivy - - 23,751 -
58,749 -
--------------------------------------------------------------------------------------------------------------------
</TABLE>
Long-Term Incentive Plan Awards in Last Fiscal Year
<TABLE>
<CAPTION>
Three Year Performance Incentive Plan (PIP) Five Year Performance Unit Plan (PUP)
-------------------------------------------- -------------------------------------------------------
Performance Estimated Future Payouts(1) Number of Performance Estimated Future Payouts(2)
Period Until ----------------------------- PUP Period Until ---------------------------
Name Payout Threshold ($) Target ($) Units Payout Threshold (#) Target (#)
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Timothy R. Wallace 3 years 0 462,000 17,986 5 years 0 17,986
John L. Adams 3 years 0 225,000 8,215 5 years 0 8,125
Mark W. Stiles 3 years 0 162,000 5,333 5 years 0 5,333
John R. Nussrallah 3 years 0 185,000 4,998 5 years 0 4,889
Jim S. Ivy 3 years 0 113,000 4,764 5 years 0 4,764
----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Payouts under the PIP for awards made during the last fiscal year are based
on "economic value added" (EVA(R)). At the end of the three year period
ending March 31, 2002, 6.66% of the EVA generated in fiscal
-----------------
EVA(R) is a registered trademark of Stern Stewart & Co.
10
<PAGE> 13
year 2001 and 3.33% of EVA generated in fiscal year 2002 will be set aside
as an incentive pool from which payouts will be made. The named executive
officers have been allocated a share of the pool. The target amount in the
table is each named executive's designated "cash cap" which is based on a
percentage of his base salary. If actual EVA performance in a year
generates an individual award that exceeds the pro rata cash caps for that
year, the excess payout will be converted to a restricted stock grant with
the number of shares of restricted stock based on the exercise prices for
options granted during that fiscal year. Vesting of the stock is subject to
continued employment for two years following the three year performance
period. Dividends are paid on these restricted shares at the same rate as
paid on the Company's Common Stock. The PIP does not have a maximum amount
that can be earned.
(2) The PUP provides the opportunity for a participant to earn PUP Units over a
five year period with a targeted goal of cumulative EVA improvement. Each
participant is assigned a targeted award of PUP Units that can be earned
upon 100% achievement of the goal. As of March 31 of each year, the number
of PUP Units in each participant's account is determined by multiplying the
target award by a fraction, the numerator of which is the Company's actual
cumulative improvement in EVA from the beginning of the five year period
and the denominator is the targeted EVA improvement. This annual
calculation can result in a decrease in the number of PUP Units from the
prior period(s). Dividend equivalents are paid on earned PUP Units. At the
end of the five year period, each PUP Unit earned will be converted to a
share of Common Stock and paid out to the participant. The PUP does not
have a maximum amount that can be earned but the targeted amount is
sufficiently high that significant achievement beyond the target would be
extraordinary.
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 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 Company has also adopted a Supplemental Retirement Plan that
permits the payment of supplemental benefits to certain employees who have been
determined by the Plan Committee to be Participants and 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 Retirement 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. Timothy
R. Wallace is the only named executive officer who is a participant in the
Supplemental Retirement Plan.
The following table reflects the estimated aggregate annual benefits,
computed on the basis of a monthly benefit payable for ten (10) years certain
and life thereafter, payable under such plans to a fully vested participant 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.
11
<PAGE> 14
Pension Plan Table
<TABLE>
<CAPTION>
Years of Service
------------------------------------------------------------------------------------------------------------
Remuneration 10 20 30 40
------------ -- -- -- --
<S> <C> <C> <C> <C>
$ 300,000 $ 29,760 $ 59,520 $ 89,280 $119,040
400,000 39,760 79,520 119,280 159,040
600,000 59,760 119,520 179,280 239,040
800,000 79,760 159,520 239,280 319,040
1,000,000 99,760 199,520 299,280 399,040
1,200,000 119,760 239,520 359,280 479,040
1,400,000 139,760 279,520 419,280 559,040
1,600,000 159,760 319,520 479,280 639,040
1,800,000 179,760 359,520 539,280 719,040
2,000,000 199,760 399,520 599,280 799,040
</TABLE>
The compensation covered under those plans is the same as the salary
and bonus reported in the Summary Compensation Table. The annual benefits shown
are not subject to any deduction for Social Security benefits or other offset
amounts. Mr. Timothy R. Wallace has 24 credited years of service under the plans
under which he is covered; Messrs. Adams, Stiles, Nussrallah and Ivy have 1
year, 8 years, 5 years and 2 years, respectively.
The Company maintains a Section 401(k) plan that permits employees to
elect to set aside up to fourteen percent (14%) 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.
Depending upon years of service, the Company matches from twenty-five (25%) to
fifty percent (50%) of up to six percent (6%) of the employee's compensation set
aside for this purpose. The Company also maintains a Supplemental Profit Sharing
Plan ("Supplemental Plan") for certain of 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 Supplemental
Plan. The first six percent (6%) of a Participant's base salary and bonus
contributed to the Supplemental Plan, less any compensation matched under the
401(k) plan, is matched from twenty-five percent (25%) to fifty percent (50%) by
the Company provided certain earnings are achieved. The Company's match vests
20% per year. An additional seventeen and one-half percent (17-1/2%) match
applies to up to twenty-five percent (25%) of a Participant's base salary and
bonus deferrals directed into stock units. The additional match for stock units
is made following each plan year provided certain earnings are achieved and
vests two plan years after the end of the plan year for which the match is made.
The additional match does not apply to stock units acquired by transfer from
existing account balances. All matches in the Supplemental Plan are made in
stock units. Stock units may not be transferred into other investment accounts
and may only be paid out in Common Stock.
CHANGE IN CONTROL AGREEMENTS
Each named executive officer has executed a change in control agreement
with the Company that provides certain benefits in the event his or her
employment is terminated subsequent to a change in control of the Company (as
defined in the agreements). The agreements are for continuous two-year terms
until terminated by the Company upon specified notice and continue for two years
following a change in control. The agreements provide that if there is a change
in control of the Company and 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
12
<PAGE> 15
agreements), or if the executive terminates his or her employment under certain
circumstances, 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
in 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 Code, 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 HUMAN RESOURCES COMMITTEE ON EXECUTIVE COMPENSATION
The Company's executive compensation program is administered by the
Human Resources Committee ("the Committee") of the Board of Directors. The
Committee, which is composed entirely of independent outside directors, is
responsible for setting and overseeing the administration of policies that
govern the compensation of the Company's executives. It establishes base salary,
incentive compensation, deferred compensation, stock options, performance units
and other stock based awards for each executive officer and certain key
operating officers of the Company, except the salary of the Chief Executive
Officer is decided by the Board, after recommendation by the Committee. The
Committee retains a consultant to advise on matters related to executive
compensation.
It is the 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 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 short-term executive compensation program in the last fiscal year were
a base salary and incentive compensation. The long-term program consists of
stock options, three year and five year performance plans, restricted stock
awards, and in some cases deferred compensation. The 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. The Committee
determines each executive's compensation based upon past and expected future
performance, the executive's responsibilities within the Company, and the
executive's value to the Company as determined by the Committee.
Base Salary
The 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. In fixing
base salaries, the Committee also considers salaries of senior executives of
other comparable companies as reflected in a survey provided by an independent
outside consultant.
Incentive Compensation
Incentive bonuses awarded annually to the Company's executive officers
and key operating officers are tied to the Company's success in achieving
certain financial and specific group goals set each year by the Committee at the
beginning of the year. Specific group targets are tied to specific short-term
goals applicable to
13
<PAGE> 16
the executive's job assignment and, in the case of Timothy R. Wallace, to the
Company's consolidated performance and enhancement of stockholder value.
Stock Options, Long-Term Performance Plans, Restricted Stock and Deferred
Compensation
Long-term incentive awards provided by the stockholder-approved stock
option and incentive plans are designed to develop and retain strong management
through stock ownership, stock options and other stock based incentive awards.
Stock options historically have been, and in fiscal 2000 were, the
significant portion of long-term incentive grants to 16 executive officers and
business group presidents and 151 key employees. Options to purchase a total of
501,200 shares were granted in fiscal 2000. The Committee believes that a
significant portion of senior executives' compensation should be dependent on
value created for stockholders. Options are an excellent vehicle to accomplish
this by tying the executives' interests directly to the stockholders' interests.
Options are granted at the fair market value of the Company's Common Stock on
the date of grant and vest in annual increments over four years after such date
if the optionee is still employed or vest fully at the date of normal
retirement.
The number of options that the Committee grants to executive officers
is based on individual performance and level of responsibility. The number of
options currently held by an executive is not a factor in determining individual
grants.
The Committee has established a Three Year Performance Incentive
Program ("PIP") and has designated awards that can be earned after a three year
period based on "economic value added" ("EVA"). The Committee believes that this
Plan provides incentive for long-term sustained growth. These performance awards
are payable in cash at the end of the three year period based on the
participant's proportionate share as determined by the Committee of a pool
funded each fiscal year with a percentage of total EVA that has been established
by the Committee. Restricted stock with a holding period to end two years after
the three year performance period will be awarded to certain executives whose
cash earnings exceed the targeted percentage of their base salary. Twenty-three
executive and operating officers participate in the PIP for the three year
period beginning in fiscal 2000.
The Committee has also implemented a new Five Year Performance Unit
Plan ("PUP") that provides the opportunity for participants to earn PUP Units
over a five-year period with a targeted goal of cumulative EVA improvement. The
Committee believes that EVA improvement over a five year period will be
beneficial to all stockholders and the Plan provides appropriate incentive for
reaching that goal. Each participant is assigned a targeted award of PUP Units
that can be earned upon 100% achievement of the goal. As of March 31 of each
year, the number of PUP Units in each participant's account is determined by
multiplying the target award by a fraction, the numerator of which is the
Company's actual cumulative improvement in EVA from the beginning of the five
year period and the denominator is the targeted EVA improvement. This annual
calculation can result in a decrease in the number of PUP Units from the prior
period(s). Dividend equivalents are paid on earned PUP Units. At the end of the
five year period, each PUP Unit earned will be converted to a share of Common
Stock and paid out to the participant. The Committee has set a total target
award of 77,200 PUP Units for 25 executive and operating officers for the five
year period beginning April 1, 1999.
A limited number of senior executives also received grants of
Restricted Shares. Restricted Shares are shares of the Company's Common Stock
granted with restrictions designed to promote long-term retention, as well as
superior long-term performance, of key strategic and operating management. The
restrictions generally expire after the executive reaches normal retirement age.
Individual grants are based on personal contribution and level of responsibility
within the organization. The number of shares currently held by an executive is
not a factor in determining individual grants since Restricted Shares are
primarily designed to promote long-term retention and
14
<PAGE> 17
steadily increasing stock ownership by the Company's key executives. The
Committee granted a total of 50,000 Restricted Shares to 31 key executives in
fiscal 2000.
To encourage the retention of certain key and strategically important
executives focused on continuous improvement and growth of the Company, the
Company has established a deferred compensation plan for Timothy R. Wallace,
John L. Adams, Jim S. Ivy and Mark W. Stiles. Under the deferred compensation
plan, an amount equal to ten percent (10%) of each participant's annual base
salary and incentive compensation is accrued to his deferred account on the
books of the Company. All such deferrals bear interest at Chase Bank of Texas'
prime lending rate.
Chief Executive Officer Compensation
Timothy R. Wallace became Chief Executive Officer of the Company on
January 1, 1999. His base salary, incentive compensation, stock option grants,
Career Share awards and stock-based performance awards are set within the
philosophy and policies enunciated above for all other executives of the
Company. His base salary was increased at the beginning of fiscal 2000 to
$700,000 in recognition of his increased management role and value to the
Company.
In determining the compensation of the Chief Executive Officer, the
Committee reviews the performance of the Company, considers the positioning of
the Company for future years, assesses his past and ongoing personal performance
in the position of Chief Executive Officer, and considers 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 comparable to that of the Company.
Limitation on Deductibility of Executive Compensation
Section 162(m) of the Internal Revenue Code denies a publicly held
corporation a federal income tax deduction for the compensation of certain
executive officers exceeding $1 million per year. "Performance based"
compensation is not subject to the limitation on deductibility, and the
Committee strives to structure compensation so as to qualify for deductibility.
Provisions have been included in the 1998 Stock Option and Incentive Plan that
are designed to qualify future awards of stock options, performance awards, and
performance-based restricted stock as "performance based." The Committee will
continue to monitor future deductibility options. However, the Committee will
authorize compensation that may not be deductible when it deems it to be in the
best interest of the Company and its stockholders.
Conclusion
The Committee believes that the Company's compensation policies and
practices are appropriately designed to attract, retain and motivate key
executives to guide the Company in the future and to produce results which will
enhance the Company's long-term prospects, thereby ultimately enriching
stockholder values.
Jess T. Hay, Chairman David W. Biegler, Member
Human Resource Committee Ronald J. Gafford, Member
Clifford J. Grum, Member
Diana S. Natalicio, Member
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Jess T. Hay, David W. Biegler, Ronald J. Gafford, Clifford J. Grum and
Diana Natalicio served on the Human Resources Committee during the last
completed fiscal year. There were no interlocks or insider participation during
such year.
15
<PAGE> 18
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's executive officers, directors and persons who own more
than ten percent (10%) of the Company's Common Stock to file initial reports of
ownership and changes in ownership with the Securities and Exchange Commission
("SEC"). These reports are also filed with the New York Stock Exchange and a
copy of each report is furnished to the Company.
Additionally, SEC regulations require that the Company identify any
individuals for whom one of the referenced reports was not filed on a timely
basis during the most recent fiscal year. To the Company's knowledge, based
solely on review of reports furnished to it and written representations that no
other reports were required during and with respect to the fiscal year ended
March 31, 2000, each individual who was required to file such reports during the
fiscal year complied with the applicable filing requirements except that Messrs.
David W. Biegler, Barry J. Galt, Clifford J. Grum, Dean P. Guerin, Timothy R.
Wallace and Dr. Diana Natalicio, all directors in the Company, did not timely
report the acquisition of stock units from the deferral of director fees in
fiscal 1999. These acquisitions of stock units have been reflected in subsequent
filings by such individuals.
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. The
source for the information contained in this table in respect to the return for
the Company and for the Dow Jones Transportation Equipment Index is Dow Jones &
Company, Inc. and, in respect to the New York Stock Exchange Index, is Media
General Financial Services.
FIVE YEAR CUMULATIVE TOTAL RETURN
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
1995 1996 1997 1998 1999 2000
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Trinity Industries, Inc. 100 95 85 156 85 70
Dow Jones Transportation Equipment Index 100 106 126 225 172 188
New York Stock Exchange Index 100 131 153 222 238 257
</TABLE>
16
<PAGE> 19
APPROVAL OF SHORT TERM MANAGEMENT INCENTIVE PLAN
The Board of Directors, upon recommendation of the Human Resources
Committee, has unanimously approved and adopted a new Short Term Management
Incentive Plan (the "Plan") to govern the award and payment of cash bonuses to
certain of the Company's executive officers and directed that the Plan be
submitted to the Company's stockholders for approval so that payments thereunder
will be deductible by the Company for federal income tax purposes.
Certain Terms Of The Plan
The following is a summary of the terms of the Plan and is qualified in
its entirety by reference to the complete text of the Plan, which is set forth
in Exhibit A.
The purpose of the Plan is to enhance the Company's ability to attract
and retain highly qualified executives and to provide additional financial
incentives to those executives to promote the success of the Company. The Plan
is also intended to satisfy the requirements for "performance-based
compensation" within the meaning of Section 162(m) of the Internal Revenue Code.
The Plan will be administered by the Human Resources Committee of the
Board or another committee appointed by the Board. In administering the Plan,
the Committee will have full power and authority to interpret the terms and
provisions of the Plan and to establish, adjust, pay or decline to pay bonuses
under the Plan.
Participation in the Plan will be limited to "Eligible Executives,"
which is defined as the Company's Chief Executive Officer and the four other
executive officers of the Company that the Committee determines are executive
officers whose compensation will be required to be reported to stockholders
under the Securities Exchange Act of 1934, as amended. Participation in the Plan
is limited to the five executive officers designated by the Committee.
The Board has established the achievement of positive "Consolidated Net
Income" as the performance goal necessary for the payment of bonuses under the
Plan. For purposes of the Plan, Consolidated Net Income consists of net income
before extraordinary items, as reported in the Company's annual published
financial statements. Within 90 days after the end of each fiscal year, the
Committee will designate those Eligible Executives who are to be participants in
the Plan for that fiscal year and will specify the terms and conditions for the
determination and payment of an "Incentive Bonus" to each of those participants.
The maximum Incentive Bonus that may be payable to the Chief Executive Officer
for any fiscal year is 1.5% of the Consolidated Net Income for that fiscal year
and for any other Eligible Executive the maximum Incentive Bonus for any fiscal
year will be 1.0% of the Consolidated Net Income for that fiscal year. The
Committee may condition the payment of an Incentive Bonus upon the satisfaction
of such objective or subjective standards that the Committee determines to be
appropriate.
As soon as practicable after the end of each fiscal year, the Committee
will certify in writing whether the stated performance goal has been met and
will determine the amount of the Incentive Bonus to be paid to each Plan
participant. In determining that amount, the Committee will consider the target
bonuses established at the beginning of the year, the degree to which the
established standards were satisfied and any other objective or subjective
factors it deems appropriate and may reduce the amount of, or eliminate
altogether, any Incentive Bonus that would otherwise be payable. Following the
Committee's determination of the Incentive Bonuses to be paid, those Incentive
Bonuses will be paid in cash.
If the Plan is approved by the Company's stockholders, it will be
effective for fiscal 2001, which commenced on April 1, 2000 and will continue in
effect until suspended or terminated by the Board. In addition, the Board may
amend the Plan from time to time as it deems advisable, except that, without the
approval of the Company's stockholders, the Board may not amend the Plan to (a)
increase the maximum amount of Incentive
17
<PAGE> 20
Bonus that may be paid or otherwise materially increase the benefits accruing to
any Eligible Executive under the Plan, (b) materially modify the eligibility
requirements for participation in the Plan or (c) change the material terms of
the stated performance goal.
Federal Income Tax Consequences
Under present federal income tax law, a Plan participant will be taxed
at ordinary income rates on the cash portion of the bonus in the year in which
such cash was received. If a participant elects to defer a portion of the bonus
pursuant to the Company's Supplemental Profit Sharing Plan, the participant will
also be entitled to defer the recognition of income. Generally, and subject to
the provisions of Section 162(m), the Company will receive a federal income tax
deduction corresponding to the amount of income recognized by the Plan
participants.
Plan Benefits
The Incentive Bonuses, if any, that will be paid to Plan participants
for any fiscal year are subject to the discretion of the Committee, based on
objective or subjective factors that the Committee considers appropriate.
Consequently, it is not possible to determine at this time the amount of the
Incentive Bonuses that will be paid for fiscal 2001. As noted above, the maximum
Incentive Bonus that may be paid under the Plan to the Chief Executive Officer
is 1.5% of Consolidated Net Income and to any other participant is 1% of
Consolidated Net Income for such fiscal year. Had the Plan been in effect for
fiscal 2000, this provision would have produced a maximum Incentive Bonus for
the Chief Executive Officer of approximately $2,482,500 and approximately
$1,655,000 for each other participant. However, had the Plan been in effect for
fiscal year 2000, using the objective and subjective standards that were
established by the Committee for the fiscal 2000 incentive bonuses, the bonus
compensation for the Chief Executive Officer and the other named executive
officers would not have changed from the amount paid and disclosed in the
Summary Compensation Table for fiscal 2000.
Reasons For Proposal
Generally, Section 162(m) of the Internal Revenue Code prevents a
company from receiving a federal income tax deduction for compensation paid to a
named executive officer in excess of $1 million for any year, unless that
compensation is performance-based. One of the requirements of performance-based
compensation for purposes of Section 162(m) is that the compensation be paid
pursuant to a plan that has been approved by the Company's stockholders. The
Board believes that it is desirable and in the best interests of the Company and
its stockholders that the cash bonuses to be paid to the Company's executive
officers be deductible for federal income tax purposes and, accordingly, has
structured the Plan to satisfy the requirements of Section 162(m) for
performance-based compensation.
If the Plan is not approved by the Company's stockholders, it is
currently contemplated that any bonuses for fiscal 2001 and subsequent years for
executive officers would be discretionary and that such bonuses would not be
deductible under Section 162(m) to the extent that they exceed the limit set
forth therein when combined with other non-exempt compensation.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE SHORT
TERM MANAGEMENT INCENTIVE PLAN.
PROPOSAL TO RATIFY THE SELECTION OF ERNST & YOUNG LLP AS
INDEPENDENT AUDITORS OF THE COMPANY FOR THE FISCAL YEAR
ENDING MARCH 31, 2001
Upon recommendation of the Audit Committee, the Board of Directors has
appointed Ernst & Young LLP as independent auditors for fiscal year 2001,
subject to ratification by stockholders.
18
<PAGE> 21
Ernst & Young LLP, 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, 2000. It is anticipated that
representatives of Ernst & Young LLP will be present at the 2000 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 2000 Annual Meeting
or submitted to them in writing before the 2000 Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF ITS
SELECTION OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS FOR FISCAL YEAR 2001.
STOCKHOLDER PROPOSAL
Hillson Partners Limited Partnership, 6900 Wisconsin Avenue, Suite 501,
Bethesda, Maryland 20815, has notified the Company that it is the beneficial
owner of 25,000 shares of common stock and that it intends to maintain such
ownership through the date of the 2000 Annual Meeting of Stockholders. Hillson
Partners Limited Partnership has advised the Company that it intends to offer
the following proposal and supporting statement for consideration and approval
at the Annual Meeting.
MAXIMIZE SHAREHOLDER VALUE RESOLUTION
Resolved that the shareholders of Trinity Industries, Inc. ("Trinity")
urge the Trinity Board of Directors to arrange for the prompt sale of Trinity to
the highest bidder or bidders.
Stockholder's Supporting Statement
The purpose of the Maximize Shareholder Value Resolution is to give all
Trinity shareholders the opportunity to send a message to the Trinity Board of
Directors that they support the prompt sale of Trinity to the highest bidder.
The proponent of this resolution believes that the sale value of the company is
substantially in excess of the public market price. A strong and or majority
vote by the shareholders would indicate to the Board that the current corporate
strategy is unacceptable and that continued poor shareholder return is
unacceptable. Even if approved by a majority of Trinity shareholders represented
and entitled to vote at the annual meeting, the Maximize Shareholder Value
Resolution will not be binding on the Trinity Board of Directors. The proponent
believes that if this resolution receives substantial support from the
shareholders, the Board may choose to carry out the request set forth in this
resolution.
Proponent further believes that if the resolution is adopted,
Management and the Board will interpret such adoption as a message from the
Company's stockholders that it is no longer acceptable for the Board to continue
with its current management plan and strategies.
I URGE YOU TO SUPPORT THIS RESOLUTION.
THE BOARD OF DIRECTORS' STATEMENT IN OPPOSITION
In the Board's opinion, the proposed stockholder resolution will not
serve the stockholder's best interests, notwithstanding the non-binding nature
of the resolution if approved by stockholders. If adopted, the proposal would be
disruptive to employees, to customers and to the Company's long-term prospects,
all to the detriment of our stockholders' fundamental interests.
The Board believes that it can function most effectively when its
strategic planning is conducted confidentially. This way, ideas and alternatives
that enhance stockholder value can be developed with flexibility to adapt to
changing circumstances and business conditions.
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The Board of Directors of Trinity is committed to value creation for
its stockholders and regularly reviews the Company's operations and strategic
alternatives to enhance stockholder values. The majority of the members of the
Board of Directors are independent directors, and all of the Directors have
diverse and broad business backgrounds and expertise on which to draw. To assist
the Board, the Company has maintained close relationships with several
nationally recognized investment banking firms and continues to obtain their
advice on various matters relating to increasing stockholder value. Trinity has
a well seasoned management team that continuously seeks to develop, in
consultation with the Board, new strategies that are designed to position the
Company to increase its market share, grow its revenues and enhance stockholder
value.
ACCORDINGLY, THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE AGAINST THIS
PROPOSAL, AND YOUR PROXY WILL BE SO VOTED IF THE PROPOSAL IS PRESENTED UNLESS
YOU SPECIFY OTHERWISE.
OTHER MATTERS
Management of the Company is not aware of other matters to be presented
for action at the 2000 Annual Meeting; however, if 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.
SUBMISSION OF FUTURE STOCKHOLDER PROPOSALS
Stockholders' proposals to be presented at the 2001 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, no later than February
19, 2001. Upon timely receipt of any such proposal, the Company will determine
whether or not to include such proposal in the proxy statement and proxy in
accordance with applicable regulations and provisions governing the solicitation
of proxies.
Under the Bylaws of the Company, certain procedures are provided which
a stockholder must follow to nominate persons for election as directors or to
introduce an item of business at an annual meeting of stockholders. These
procedures provide, generally, that stockholders desiring to make nominations
for directors, and/or bring a proper subject of business before the meeting,
must do so by a written notice timely received (not less than sixty (60) days
nor more than ninety (90) days prior to the anniversary date of the immediately
preceding annual meeting by the Secretary of the Company containing the name and
address of the stockholder, the number of shares of the Company beneficially
owned by the stockholder, and a representation that the stockholder intends to
appear in person or by proxy at the meeting. If the notice relates to a
nomination for director, it must also set forth the name and address of any
nominee(s), all arrangements or understandings between the stockholder and each
nominee and any other person or person(s) (including their names) pursuant to
which the nomination(s) are to be made, such other information regarding each
nominee as would have been required to be included in a proxy statement filed
pursuant to the proxy rules of the Securities and Exchange Commission had each
nominee been nominated by the Board, and the consent of each nominee to serve.
The Company may require any proposed nominee to furnish such other information
as may reasonably be required by the Company to determine the eligibility of
such proposed nominee to serve as director. Notice of an item of business shall
include a brief description of the proposed business and any material interest
of the stockholder in such business.
The Chairman of the meeting may refuse to allow the transaction of any
business not presented, or to acknowledge the nomination of any person not made,
in compliance with the foregoing procedures. Copies of the Company's Bylaws are
available from the Secretary of the Company.
REPORT ON FORM 10-K
Upon written request from any stockholder of record, the Company will
furnish to such stockholder, without charge, its Annual Report on Form 10-K for
the fiscal year ended March 31, 2000, as filed with the
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<PAGE> 23
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. Michael G. Fortado,
Vice President, General Counsel and Corporate Secretary, Trinity Industries,
Inc., P. O. Box 568887, Dallas, Texas 75356-8887.
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
MICHAEL G. FORTADO
Vice President, General Counsel
and Corporate Secretary
June 19, 2000
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<PAGE> 24
EXHIBIT A
TRINITY INDUSTRIES, INC.
SHORT-TERM MANAGEMENT INCENTIVE PLAN
Trinity Industries, Inc., a Delaware corporation (the "Company") adopts
this Short-Term Management Incentive Plan (the "Plan") for the purpose of (i)
promoting the achievement of superior financial and operating performance of
Trinity Industries, Inc. and its subsidiaries through the awarding of annual
cash incentives to participants in the Plan, (ii) rewarding participants who
make significant contributions to the Company's success, and (iii) providing the
Company a means to attract, motivate and retain certain key senior officers.
Compensation payable under the Plan is intended to constitute "qualified
performance-based compensation" for the purposes of Section 162(m) of the
Internal Revenue Code of 1986, as amended. The performance goal necessary for
the payment of compensation under the Plan will be achievement of positive
Consolidated Net Income.
1. DEFINITIONS. As used herein, the following terms shall have the
respective meanings indicated:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Code" shall mean the Internal Revenue Code of 1986, as
amended, or the corresponding provisions of any subsequent federal
internal revenue law.
(c) "Committee" shall mean the Human Resources Committee of
the Board or such other committee appointed by the Board to administer
the Plan.
(d) "Company" shall mean Trinity Industries, Inc., a Delaware
corporation.
(e) "Consolidated Net Income" shall mean, for any Fiscal Year,
the net income before extraordinary items reported in the Company's
annual consolidated statement of income included in the Annual Report
on Form 10-K, as filed with the Securities Exchange Commission pursuant
to the Securities Exchange Act of 1934, as amended.
(f) "Eligible Executive" shall mean the Company's Chief
Executive Officer and each of the four other executive officers of the
Company that the Committee determines, in its discretion, is an
executive officer whose compensation will be required to be reported to
stockholders under the Securities Exchange Act of 1934, as amended.
(g) "Incentive Bonus" shall mean, for each Eligible Executive,
an annual bonus opportunity amount determined by the Committee pursuant
to Section 3 below.
(h) "Regulations" shall mean the Treasury Regulations
promulgated under the Code, as amended from time to time.
2. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
Committee, which shall have full power and authority to construe, interpret and
administer the Plan and shall have the exclusive right to establish, adjust, pay
or decline to pay the Incentive Bonus for each Eligible Executive. Such power
and authority shall include the right to exercise discretion to reduce by any
amount the Incentive Bonus payable to any Eligible Executive; provided, however,
that the exercise of such discretion with respect to any Eligible Executive
shall not have the effect of increasing the Incentive Bonus that is payable to
any other Eligible Executive.
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<PAGE> 25
3. ELIGIBILITY. Eligibility under this Plan is limited to Eligible
Executives designated by the Committee in its sole and absolute discretion.
4. AWARDS.
(a) Not later than the 90th day of each fiscal year of the
Company, the Committee, in its sole and absolute discretion, shall
designate one or more Eligible Executives as participants in the Plan
for such fiscal year and shall specify the terms and conditions for the
determination and payment of an Incentive Bonus to each such Eligible
Executive for such fiscal year, including the establishment of a
targeted award for each Eligible Executive based on a percentage of the
salary of each Eligible Executive.
(b) The Committee may condition the payment of an Incentive
Bonus upon satisfaction of such objective or subjective standards as
the Committee shall determine to be appropriate, in its sole and
absolute discretion, and shall retain the discretion to reduce the
amount of any Incentive Bonus that would otherwise be payable to an
Eligible Executive (including a reduction in such amount to zero).
(c) The Incentive Bonus payable to the Chief Executive Officer
of the Company with respect to any fiscal year shall not exceed 1.5% of
the Consolidated Net Income for such fiscal year. The Incentive Bonus
payable to any other Eligible Executive with respect to any fiscal year
shall not exceed 1.0% of the Consolidated Net Income for such fiscal
year.
5. COMMITTEE CERTIFICATION. As soon as reasonably practicable after the
end of each fiscal year of the Company, the Committee shall determine whether
the stated performance goal has been achieved and the amount of the Incentive
Bonus to be paid to each Eligible Executive for such fiscal year and shall
certify such determinations in writing.
6. PAYMENT OF INCENTIVE BONUSES. Subject to any election duly and
validly made by an Eligible Executive with respect to the deferral of all or a
portion of his or her Incentive Bonus, Incentive Bonuses shall be paid in cash
at such times and on such terms as are determined by the Committee in its sole
and absolute discretion.
7. NO RIGHT TO BONUS OR CONTINUED EMPLOYMENT. Neither the establishment
of the Plan, the provision for or payment of any amounts hereunder nor any
action of the Company, the Board or the Committee with respect to the Plan shall
be held or construed to confer upon any person (a) any legal right to receive,
or any interest in, an Incentive Bonus or any other benefit under the Plan or
(b) any legal right to continue to serve as an officer or employee of the
Company or any subsidiary or affiliate of the Company. The Company expressly
reserves any and all rights to discharge any Eligible Executive without
incurring liability to any person under the Plan or otherwise.
8. WITHHOLDING. The Company shall have the right to withhold, or
require an Eligible Executive to remit to the Company, an amount sufficient to
satisfy any applicable federal, state, local or foreign withholding tax
requirements imposed with respect to the payment of any Incentive Bonus.
9. NONTRANSFERABILITY. Except as expressly provided by the Committee,
the rights and benefits under the Plan are personal to an Eligible Executive and
shall not be subject to any voluntary or involuntary alienation, assignment,
pledge, transfer or other disposition.
10. UNFUNDED PLAN. The Company shall have no obligation to reserve or
otherwise fund in advance any amounts that are or may in the future become
payable under the Plan. Any funds that the Company, acting in its sole and
absolute discretion, determines to reserve for future payments under the Plan
may be commingled with other funds of the Company and need not in any way be
segregated from other assets or funds held by the Company. An Eligible
Executive's rights to payment under the Plan shall be limited to those of a
general creditor of the Company.
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<PAGE> 26
11. ADOPTION, AMENDMENT, SUSPENSION AND TERMINATION OF THE PLAN.
(a) Subject to the approval of the Plan by the holders of a
majority of the Company common stock represented and voting on the
proposal at the annual meeting of Company stockholders to be held on
July 19, 2000 (or any adjournment thereof), the Plan shall be effective
for the fiscal year of the Company commencing April 1, 2000 and shall
continue in effect until terminated by the Board. Upon such approval of
the Plan by the Company's stockholders, all Incentive Bonuses awarded
under the Plan on or after July 19, 2000 shall be fully effective as if
the stockholders had approved the Plan on or before April 1, 2000.
(b) Subject to the limitations set forth in this subsection,
the Board may at any time suspend or terminate the Plan and may amend
it from time to time in such respects as the Board may deem advisable;
provided, however, that the Board shall not amend the Plan in any of
the following respects without the approval of stockholders:
(1) To increase the maximum amount of Incentive Bonus
that may be paid under the Plan or otherwise materially
increase the benefits accruing to any Eligible Executive under
the Plan;
(2) To materially modify the requirements as to
eligibility for participation in the Plan;
(3) To change the material terms of the stated
performance goal.
(c) No Incentive Bonus may be awarded during any suspension or
after termination of the Plan, and no amendment, suspension or
termination of the Plan shall, without the consent of the person
affected thereby, alter or impair any rights or obligations under any
Incentive Bonus previously awarded under the Plan.
A-3
<PAGE> 27
TRINITY INDUSTRIES, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS - JULY 19, 2000
The undersigned hereby appoints Timothy R. Wallace, Dean P. Guerin and
Michael G. Fortado 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 at its
offices, 2525 Stemmons Freeway, Dallas, Texas 75207, on Wednesday, July 19, 2000
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.
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 NAMED NOMINEES FOR DIRECTOR, FOR PROPOSALS 2 AND 3 AND
AGAINST PROPOSAL 4.
(Continued and to be marked, dated and signed on reverse side)
TRINITY INDUSTRIES, INC.
P.O. BOX 11369
NEW YORK, N.Y. 10203-0369
<PAGE> 28
(1) Election of ten (10) Directors:
FOR ALL NOMINEES [ ] WITHHOLD AUTHORITY to vote [ ] EXCEPTIONS [ ]
listed below for all nominees listed below.
Nominees: David W. Biegler, Ronald J. Gafford, Barry J. Galt, Clifford J. Grum,
Dean P. Guerin, Jess T. Hay, Edmund M. Hoffman, Diana S. Natalicio, Timothy R.
Wallace and W. Ray Wallace.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK THE
"EXCEPTIONS" BOX AND STRIKE A LINE THROUGH THAT NOMINEE'S NAME.)
(2) To approve the Trinity Industries Short Term Management Incentive Plan.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(3) To approve ratification of Ernst & Young as Independent Auditors for fiscal
year 2001.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(4) To vote on a stockholder proposal recommending to the Board of Directors to
promptly sell the Company to the highest bidder.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(5) In their discretion on such other matters as may properly come before the
Meeting.
Change of Address and or Comments Mark
Here [ ]
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.
DATED:
-------------------------------
-------------------------------------
SIGNATURE
-------------------------------------
SIGNATURE
VOTES MUST BE INDICATED [ ]
(x) in Black or Blue ink.
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY
IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED.
