-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H88ukkk1r9emWNa97jij0Bo78iFMKlTLWuiJ09kN+Qxh2drXTCMaJOMP9fgoVtk6 y/fow4VkW/X7dA8fu7fd0A== 0000950137-97-000936.txt : 19970307 0000950137-97-000936.hdr.sgml : 19970307 ACCESSION NUMBER: 0000950137-97-000936 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970415 FILED AS OF DATE: 19970306 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: BUTLER MANUFACTURING CO CENTRAL INDEX KEY: 0000015840 STANDARD INDUSTRIAL CLASSIFICATION: PREFABRICATED METAL BUILDINGS & COMPONENTS [3448] IRS NUMBER: 440188420 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-12335 FILM NUMBER: 97551500 BUSINESS ADDRESS: STREET 1: BMA TOWER PENN VALLEY PARK STREET 2: P O BOX 419917 CITY: KANSAS CITY STATE: MO ZIP: 64141 BUSINESS PHONE: 8169683000 MAIL ADDRESS: STREET 1: BMA TOWER PENN VALLEY MALL STREET 2: P O BOX 419917 CITY: KANSAS CITY STATE: MO ZIP: 64141 DEF 14A 1 NOTICE & PROXY STATEMENT/PROXY CARD 1 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: / / 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-11(c) or Rule 14a-12 BUTLER MANUFACTURING COMPANY - -------------------------------------------------------------------------------- (Name of Registrant as Specified in Its Charter) BUTLER MANUFACTURING COMPANY - -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of filing fee (Check the appropriate box): / / $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or Item 22(a)(2) of Schedule 14A. / / $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). / / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. (1) Title of each class of securities to which transaction applies: - -------------------------------------------------------------------------------- (2) Aggregate number of securities to which transaction applies: - -------------------------------------------------------------------------------- (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined): - -------------------------------------------------------------------------------- (4) Proposed maximum aggregate value of transaction: - -------------------------------------------------------------------------------- (5) Total fee paid: - -------------------------------------------------------------------------------- / / Fee paid previously with preliminary materials. - -------------------------------------------------------------------------------- / / Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. (1) Amount previously paid: - -------------------------------------------------------------------------------- (2) Form, schedule or registration statement no.: - -------------------------------------------------------------------------------- (3) Filing party: - -------------------------------------------------------------------------------- (4) Date filed: - -------------------------------------------------------------------------------- 2 BUTLER MANUFACTURING COMPANY BMA Tower - Penn Valley Park (P.O. Box 419917) Kansas City, Missouri 64l4l-0917 March 10, 1997 NOTICE OF ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENT To the Stockholders: The annual meeting of stockholders of Butler Manufacturing Company will be held at Atkins Auditorium, Nelson-Atkins Museum of Art, 4525 Oak Street, Kansas City, Missouri, on Tuesday, April 15, l997, beginning at 9:30 a.m., local time for the following purposes: l. To elect three directors each for a three year term expiring in 2000; 2. To transact such other business as may properly come before the meeting. Holders of Common Stock of record on the books of the Company at the close of business on February 18, 1997, will be entitled to vote at the meeting or any adjournment thereof. A list of stockholders of the Company as of the close of business on February 18, 1997, will be available for inspection during business hours from March 31, 1997 through the close of business on April 14, 1997 at the Company's offices at BMA Tower, Kansas City, Missouri and will also be available at the meeting. STOCKHOLDERS ARE REQUESTED TO COMPLETE, SIGN, DATE AND MAIL PROMPTLY IN THE ENCLOSED ENVELOPE THE ACCOMPANYING PROXY SO THAT, IF YOU ARE UNABLE TO ATTEND THE MEETING, YOUR SHARES MAY NEVERTHELESS BE VOTED. By Order of the Board of Directors, ROBERT H. WEST Chairman of the Board RICHARD O. BALLENTINE Vice President, General Counsel and Secretary 3 PROXY STATEMENT This Proxy Statement is being furnished in connection with the solicitation of proxies for use at the Company's 1997 annual meeting of stockholders on April 15, 1997, as set forth in the preceding Notice. It is expected that this Proxy Statement and enclosed form of Proxy will be mailed to stockholders commencing March 10, 1997. A returned Proxy will not be exercised if you attend the meeting and choose to cast a ballot, or if you should otherwise give written notice of revocation at any time before it is exercised. Holders of common stock of record at the close of business on February 18, 1997, are entitled to vote at the meeting. As of February 18, 1997, there were 7,578,476 shares of common stock outstanding, each share being entitled to one vote. As of February 18, there were no shares of Class A or Class 1 Preferred Stock issued or outstanding. Stockholders representing a majority of the common stock outstanding and entitled to vote must be present or represented by proxy in order to constitute a quorum to conduct business at the meeting. The only matter to be submitted to the Stockholders at the meeting is the election of three directors. If any other matters are properly brought before the meeting, the enclosed proxy permits the stockholder to give discretionary authority to the persons named in the proxy to vote the shares in their best judgment. YOU ARE SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS TO SIGN, DATE AND RETURN THE PROXY CARD IN THE ACCOMPANYING ENVELOPE, which is postage-paid if mailed in the United States. Abstentions and broker non-votes will be counted as present for purposes of determining the existence of a quorum at the Annual Meeting. Abstentions will be treated as shares present and entitled to vote for purposes of any matter requiring the affirmative vote of a majority or other proportion of the shares present and entitled to vote. With respect to any matter brought before the Annual Meeting requiring the affirmative vote of a majority or other proportion of the outstanding shares, an abstention or non-vote will have the same effect as a vote against the matter being voted upon. You may revoke your proxy at any time before it is actually voted at the Annual Meeting by (i) delivering written notice of revocation to the Secretary of the Company, (ii) submitting a subsequently dated proxy, or (iii) attending the meeting and withdrawing the proxy. Each unrevoked proxy card properly executed and received prior to the close of the voting will be voted as indicated. Where specific instructions are not indicated, the proxy will be voted FOR the election of all directors as nominated. 4 ELECTION OF CLASS B DIRECTORS NOMINEES. The primary purpose for this year's annual meeting is the election of three Class B Directors, each for terms of three years expiring at the Annual Meeting of Stockholders for 2000. The terms of the other two classes of directors do not expire until 1998 (Class C) and 1999 (Class A). Persons elected as directors continue to hold office until their terms expire or until their successors are elected and are qualified. Each nominee has consented to be named and to serve if elected. All nominees are current directors. If for any reason any should not be available or able to serve, the proxies will exercise discretionary authority to vote for substitutes proposed by the Board of Directors of the Company. VOTING. By checking the appropriate box on your proxy card you may (i) vote for all of the director nominees as a group; (ii) withhold authority to vote for all director nominees as a group; or (iii) vote for all director nominees as a group except those nominees you identify in the line provided for that choice. The three nominees for director who receive the highest number of votes cast will be elected as directors. CLASS B NOMINEES (TERMS WILL EXPIRE 2000) ROBERT E. COOK President and Chief Executive Officer of Frigidaire Home Products, a division of White Consolidated, Inc.; Chairman of the Audit Committee and member of the Compensation and Benefits Committee. Cook, age 53, has been a director since July, 1987. He has been President and Chief Executive Officer of Frigidaire Home Products, a division of White Consolidated, Inc., since 1997. Frigidaire Home Products is a manufacturer of major appliances and lawn and garden products. From 1985 to 1997, he was President and CEO of American Yard Products, Inc., a manufacturer of outdoor power equipment. 2 5 ROBERT J. REINTJES, SR. President and Chief Executive Officer, Geo. P. Reintjes Co., Inc.; Member of the Audit and Compensation and Benefits Committees. Reintjes, age 65, has been President and Chief Executive Officer of Geo. P. Reintjes Co., Inc. of Kansas City, Missouri for over 20 years. Geo. P. Reintjes Co., Inc. is a specialty contracting firm which installs refractories and weld overlay in basic industries. He is also a director of Midwest Grain Products, Inc. and Commerce Bank of Kansas City, N.A. and is a trustee of the Francis Families Foundation, Midwest Research Institute, and Benedictine College. He is Chairman of the Kansas City Crime Commission. JUDITH A. ROGALA Business Consultant. Formerly Executive Vice President, Business Services Division, Office Depot Inc.; Member of the Audit and Compensation and Benefits Committees. Rogala, age 55, a director since 1989, has been a business consultant since 1997. From 1994 to 1997, she was Executive Vice President, Business Services Division, Office Depot Inc., a distributor of office supplies. From 1992 to 1994, she was the CEO and President of EQ-The Environmental Quality Company, a management services company for several affiliated companies specializing in hazardous and solid waste management, energy recovery and hydraponic agriculture. She is also a director of Red Roof Inns, Inc., a member of the Board of Advisors, DSC Logistics, Inc. and a member of the Economic Club of Chicago. CLASS C DIRECTORS (TERMS EXPIRE 1998) ALAN M. HALLENE Retired. Former President, Montgomery Elevator International; Chairman of the Board Organization Committee and member of the Audit Committee. Hallene, age 68, has been a Director since 1979. He served as a director of Montgomery Elevator Company from 1960 to 1994 and President, Montgomery Elevator International from 1989 to his retirement in November, 1994. Mr. Hallene is also a director of Pella Corporation, John D. and Catherine T. MacArthur Foundation, First Midwest Bancorp and University of Illinois Foundation. He is a trustee of the Butterworth Memorial Trust. 3 6 ROBERT J. NOVELLO Chairman and Chief Executive Officer, Copeland Corporation and Executive Vice President, Emerson Electric Company; Member of the Audit and Board Organization Committees. Novello, age 59, has been a Director since 1996. He has been Chairman and Chief Executive Officer of Copeland Corporation, a subsidiary of Emerson Electric Company, since 1987 and Executive Vice President, Emerson Electric Company since 1988. Copeland manufactures compressors for air conditioning systems and for commercial refrigeration equipment. Mr. Novello is also an Advisory Member, Board of Directors, Emerson Electric Company and a director of the Air Conditioning and Refrigeration Institute and of Northeastern University National Council. GEORGE E. POWELL, JR. Retired. Former Chairman of the Board, Yellow Corporation; Member of the Audit, Board Organization and Executive Committees. Powell, age 70, has been a Director since 1965. Mr. Powell was Chairman of the Board of Yellow Corporation, a freight transportation company, and its predecessor, Yellow Freight Systems, Inc., of Delaware, from 1968 to 1983. He is also a director of First America Financial Corporation. He is President of Powell Gardens, Inc., a trustee of Midwest Research Institute and a director of the Kansas City Symphony Foundation. ROBERT H. WEST Chairman of the Board and Chief Executive Officer; Chairman of the Executive Committee and member of the Board Organization Committee. West, age 58, has been a Director since 1975. He joined Butler in 1968, became President in 1978 and Chairman of the Board in 1986. Mr. West is a director of Commerce Bancshares, Inc., Burlington Northern Santa Fe Corporation, Kansas City Power & Light Company, and St. Luke's Hospital. He is a trustee of the University of Missouri at Kansas City. 4 7 CLASS A DIRECTORS (TERMS EXPIRE 1999) HAROLD G. BERNTHAL Chairman, CroBern, Inc., Member of the Board Organization and Compensation and Benefits Committees. Bernthal, age 68, has been a Director since 1979. He has been Chairman of CroBern, Inc., a health care management and investment company, since 1986. Mr. Bernthal served as Vice Chairman, President and Chief Operating Officer of American Hospital Supply Corporation from 1974 through 1985. He is also a director of Nalco Chemical Company and National Standard Company and a Governing Member, Chicago Symphony Orchestra. He is an honorary director of Valparaiso University. C. L. WILLIAM HAW President and Chief Executive Officer of National Farms, Inc. Chairman of the Compensation and Benefits Committee and a member of the Board Organization and Executive Committees. Haw, age 58, has been a Director since 1983. He has been employed as the President and Chief Executive Officer of National Farms, Inc., a diversified agricultural production company, since 1974. He is also a director of Commerce Bank of Kansas City, N.A. DONALD H. PRATT President; member of the Executive Committee. Pratt, age 59, has been a Director since 1979. He joined Butler in 1965, became Executive Vice President in 1980, and President of the Company in 1986. Mr. Pratt is also a director of American Century Mutual Funds and is a trustee of the Kansas City Art Institute and Midwest Research Institute. He serves on the FFA Sponsors Advisory Board. 5 8 CERTAIN INFORMATION CONCERNING THE BOARD AND ITS COMMITTEES The Board has four standing committees: (1) the Audit Committee, (2) the Executive Committee, (3) the Board Organization Committee, and (4) the Compensation and Benefits Committee. All committees consist of non-employee directors except the Executive and Board Organization Committees. The primary functions of the committees are described below. During 1996, the Board met 5 times and the various committees met as follows: Compensation and Benefits - 3 times; Audit - 2 times; Board Organization - 2 times; and the Executive Committee had no meeting. The average attendance at the aggregate of all board and committee meetings was 98%. All directors attended 88% or more of such meetings. Non-employee directors are paid $20,000 per annum (all in Butler common stock), $1,000 for attendance at each board and committee meeting and for attendance in connection with special assignments. Attendance by means of conference telephone is compensated at the rate of $1,000 per meeting. Travel allowances are provided where appropriate. The Company provides $50,000 of accidental death and of term life insurance for each non-employee director while the director serves as such and thereafter for those who have served for more than ten years. Directors who are employees of the Company receive no director compensation. The Audit Committee recommends to the Board an independent accountant to audit the books and records of the Company and its subsidiaries for the year. It also reviews, to the extent it deems appropriate, litigation and pending claims, the scope, plan and findings of the independent accountant's annual audit and internal audits, recommendations of the auditor, the adequacy of internal accounting controls and audit procedures, the Company's audited financial statements, non-audit services performed by the independent auditor, and fees paid to the independent auditor for audit and non-audit services. The Audit Committee also monitors compliance with the Company's policies concerning business conduct. The Executive Committee acts for the Board of Directors upon matters requiring action before the next Board meeting. The Board Organization Committee recommends to the Board qualifications for new director nominees, candidates for nomination, the structure of Board committees, the review of director performance and policies concerning compensation and length of service. The Committee considers written recommendations from stockholders concerning these subjects and suggests that they be addressed to the Secretary of the Company. Recommendations for director nominees should provide pertinent information concerning the candidate's background and experience. A description of the Compensation and Benefits Committee's responsibilities is set out under "COMPENSATION AND BENEFITS COMMITTEE.". NOMINATING PROCEDURES The Company's Bylaws establish a procedure for the nomination of candidates for election to the Board of Directors. Nominations may be made at an annual meeting of stockholders pursuant to the Corporation's notice of meeting, by or at the direction of the Board of Directors, or by any stockholder of the Corporation who was a stockholder of record at the time of giving of notice, who is entitled to vote 6 9 at the meeting and who complied with the notice procedures set forth. Notice of proposed stockholder nominations for election of directors must also be given to the Secretary not less than 70 days nor more than 90 days before the anniversary date of the last annual meeting for annual meetings and not less than ten days after notice to stockholders for any special meeting for the election of Directors. The notice must contain certain information about each proposed nominee, including his/her age, business and residence addresses and principal occupation, the number of shares of capital stock of the Company beneficially owned by the nominee and such other information as would be required to be included in a proxy statement. Provision is also made for substitution of nominees should a designated nominee be unable or unwilling to stand for election at the meeting. If the Chairman of the meeting of stockholders determines that a nomination was not made in accordance with these procedures, the nomination shall be void. The advance notice requirement permits the Board to inform stockholders in a timely manner about the qualifications of the proposed nominees. BENEFICIAL OWNERSHIP TABLE The following table sets forth information regarding beneficial ownership of Butler common stock by all present directors and the executive officers who are listed in the Summary Compensation Table. The table reports ownership as of February 18, 1997. Except as indicated, no director or executive officer beneficially owns as much as one percent of all outstanding Butler common stock. The table also sets forth the number of shares beneficially owned and the percentage of ownership of Butler common stock by all directors and executive officers as a group and by each person who was known by the Company to own beneficially as much as five percent of the total outstanding shares of Butler common stock as of February 18, 1997.
AMOUNT AND NATURE PERCENT OF OF BENEFICIAL COMMON STOCK STOCKHOLDER OWNERSHIP OWNED ----------- ----------------- ----- Robert H. West (a) ................................................ 74,101 Donald H. Pratt (b) ............................................... 22,526 Harold G. Bernthal ................................................ 9,769 Robert E. Cook .................................................... 9,619 Alan M. Hallene ................................................... 4,219 C. L. William Haw ................................................. 6,619 Robert J. Novello.................................................. 376 George E. Powell, Jr............................................... 24,619 Robert J. Reintjes, Sr............................................. 2,359 Judith A. Rogala................................................... 1,969 Richard O. Ballentine (c).......................................... 14,702 John J. Holland (d)................................................ 16,832 Richard S. Jarman (e).............................................. 67,115 All Directors and Executive Officers as a Group of 25 (f) 412,306 5.25% Trustee of Butler Manufacturing Company Employee Stock Ownership Plan Trust (ESOP) (g)..................... 982,606 12.97% Ryback Management Corporation (h).................................. 440,000 5.8%
7 10 FMR Corp. and Edward C. Johnson 3d(i).................................... 863,950 11.4%
For purposes of the table a person is deemed to be a beneficial owner of shares if the person has or shares the power to vote or dispose of them, or if the person has the right to acquire such power within sixty days through the exercise of a stock option or otherwise ("stock acquisition rights"). Unless otherwise indicated in the footnotes below, each person had sole voting and investment power over the shares listed under "Amount and Nature of Beneficial Ownership" above. Percentage of ownership is calculated on the basis of 7,578,476 shares outstanding at February 18, 1997, plus the number of shares subject to stock acquisition rights for those persons and groups holding such rights. The stockholders disclaim beneficial ownership in the shares described in the footnotes as being "held by" or "held for the benefit of" other persons. (a) Includes 8,613 shares allocated to Mr. West's account under the ESOP and 239 shares held by a member of Mr. West's family. Mr. West shares no voting and investment power with respect to the 239 shares. (b) Includes 7,175 shares allocated to Mr. Pratt's account under the ESOP. (c) Includes 3,837 shares subject to exercisable outstanding stock options, 4,414 shares allocated to Mr. Ballentine's account under the ESOP and 90 shares held by a member of Mr. Ballentine's family. Mr. Ballentine shares voting and investment power with respect to the 90 shares. (d) Includes 10,000 shares subject to exercisable outstanding stock options and 3,471 shares allocated to Mr. Holland's account under the ESOP. (e) Includes 46,475 shares subject to exercisable outstanding stock options and 4,964 shares allocated to Mr. Jarman's account under the ESOP. (f) Includes 130,852 shares subject to exercisable outstanding stock options and 57,352 shares allocated to the accounts of officers under the ESOP. (g) The shares are held for the benefit of Plan participants. The amount and percent do not include shares mentioned in the preceding footnotes which are allocated to the accounts of officers. Under the Plan, the trustee passes on to participants voting and permitted reinvestment decisions as to allocated shares. (h) Ryback Management Corporation is an investment advisor for Lindner Investment Series Trust. The shares are held by Lindner Growth Fund, a registered investment company that is a separate series of the Lindner Investment Series Trust. The reporting persons claim sole voting and investment power with respect to all 440,000 shares. The address of Ryback Management Corporation is 7711 Corondelet Avenue, St. Louis, Missouri 63105. (i) FMR Corp. is the owner of Fidelity Management Trust Company (a Bank that reports beneficial ownership of 528,700 shares of the Company's Common Stock for institutional accounts) and Fidelity Management Research Company, an investment advisor to several investment companies which reports beneficial ownership of 335,250 shares. FMR Corp. reports that it is controlled by the family of Edward C. Johnson 3d. The reporting persons and related entities report sole power to vote 556,100 of the shares and sole power to dispose of 863,950 of the shares. The address of FMR Corp. is 82 Devonshire Street, Boston, Mass. 02109. 8 11 COMPENSATION AND BENEFITS COMMITTEE The Compensation and Benefits Committee ("Committee") is composed of five independent outside directors. It is the Committee's responsibility to assure that the Company's policies regarding executive compensation are followed, to recommend changes to the policies, to recommend to the Board the compensation of the Chief Executive Officer and of the President, to review compensation plans for other executive officers and management personnel as recommended by the Chief Executive Officer, and to administer the Company's stock incentive plans. The Committee also reviews proposals concerning the adoption of or material changes to Company pension plans, the financial condition of each plan and the investment performance of each investment advisor. It recommends to the Board the amount of the Company's annual contribution to the Employee Stock Ownership Plan and to the Company's 401(k) Plan. The Committee also recommends to the Board the appointment of plan trustees and approves the appointment of investment advisors and actuaries. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION Messrs. Bernthal, Cook, Reintjes and Haw and Ms. Rogala serve as members of the Committee. No Committee member is an officer or former officer of the Company. No Committee or board member has been or is an executive of another company on whose board a Butler executive sits. REPORT OF THE COMPENSATION AND BENEFITS COMMITTEE ON EXECUTIVE COMPENSATION Following is the Compensation and Benefits Committee's Report on the Company's compensation policies and practices with respect to compensation for executive officers. COMPENSATION POLICIES APPLICABLE TO BUTLER'S EXECUTIVE OFFICERS. It is the Company's policy that executive officers receive total compensation that is appropriate in light of business unit and corporate performance, and the executive's performance in achieving both annual and strategic goals and that is competitive with compensation levels of companies of comparable type and size. Each factor is considered in arriving at total compensation with business unit performance given greater weight for business unit executives and corporate performance for corporate executives. Because of the cyclical nature of the Company's business, the Committee's policy is to conservatively manage fixed compensation and emphasize variable, results-oriented compensation, to achieve a competitive total compensation package for executives. The Committee considers total remuneration data on an annual basis to ensure that the Company is appropriately aligned with the market for executive talent. Companies with whom the Committee compares compensation are companies in the same or related industry as the Company and durable goods manufacturing companies of comparable size as surveyed and reported by independent consulting organizations. While the Committee does not attempt to set executive compensation at any particular competitive level, survey data indicates that the Company's executive compensation is usually below the midpoint of the compensation paid by such comparable companies. The key elements of executive compensation are base salary, annual bonus, stock options and restricted stock bonus awards. Base salaries for executives are set subjectively within salary ranges which are established for each position based on the surveys mentioned above. Factors typically considered by the Committee in 9 12 setting base salaries are the CEO's recommendation, individual performance, leadership, tenure and length of time since the last salary adjustment. The Company's executive officers are eligible for an annual incentive cash bonus. Bonus amounts are discretionary and are based on corporate affordability and on achievement of business unit and corporate pretax operating earnings objectives. At the beginning of each year, threshold and target levels of pretax operating earnings for the year are established for the Company and each business unit. Normally, no bonus is awarded unless the threshold level of pretax earnings is met. If the threshold level is met, the Committee will consider bonuses ranging from 5 to 75% of annual base pay depending on how close actual pretax operating earnings are to the established targets. The Committee may also consider individual non-financial performance in determining final amounts of any discretionary bonus awards. Long-term incentives are provided exclusively through the grant of stock options and restricted stock bonus awards. Throughout its ninety-five year history, the Company has had a strong tradition of employee stock ownership at all organizational levels. The belief has been that employee stock ownership encourages close identity of interests among shareholders, executives and operating personnel. Stock options and restricted stock bonus awards are granted at current market price so that executive rewards accrue only as shareholder value increases. The Company believes that as a long-term incentive the Company's stock price provides an appropriate yardstick by which to measure and reward executive performance. Stock options and the opportunity to participate in the restricted stock bonus award program are normally granted once a year to a group of senior executives whose positions of responsibility afford them the opportunity to significantly affect the future growth and profitability of the Company. The total number of options granted in any one year will be approximately equivalent to the total number of shares authorized for use in the plan, divided by the number of years the current plan is expected to remain in effect. The number of individual options awarded is discretionary. Among factors considered are the executive's job responsibilities, the Company's strategic priorities, the number of shares currently owned by the executive, and the number of options previously granted to the executive. In setting executive compensation, the Committee takes into account a number of other factors including pension benefits, supplemental retirement benefits, insurance and other benefits, that are described in this Proxy Statement. COMMITTEE'S BASES FOR THE CEO'S COMPENSATION FOR 1996, INCLUDING THE FACTORS AND CRITERIA UPON WHICH THE CEO'S COMPENSATION WAS BASED. With respect to the salary paid to Mr. West for 1996, the Committee took into consideration, in addition to the factors mentioned above, the following: the annual salaries of chief executive officers of the comparable companies described above; the Company's level of profitability in 1995; and Mr. West's leadership in setting and effecting the long term strategic growth of the Company. In 1996, the Company exceeded its target pretax operating earnings goal. Based on these results, Mr. West was awarded a bonus of $270,000, as compared to a bonus of $207,000 for 1995. In awarding this bonus, the Committee also considered Mr. West's role in promoting the long-term strategic growth of the Company. This report is made over the name of each member of the Committee, namely Harold G. Bernthal, Robert E. Cook, C.L. William Haw, Robert J. Reintjes, Jr., and Judith A. Rogala. 10 13 SUMMARY COMPENSATION TABLE The table below shows all plan and non-plan compensation awarded to, earned by, or paid to the Company's Chief Executive Officer and its four most highly compensated executive officers other than the CEO, for services rendered to the Company and its subsidiaries during the periods indicated.
LONG-TERM COMPENSATION (1) ALL OTHER NAME AND ANNUAL COMPENSATION RESTRICTED COMPENSA- PRINCIPAL POSITION YEAR SALARY BONUS OTHER STOCK AWARDS TION (2) Robert H. West 1996 $359,000 $270,000 $2,600 None $294,235 Chairman of the 1995 $345,000 $207,000 $520 None $294,240 Board and Chief 1994 $332,000 $166,000 None None $296,710 Executive Officer Donald H. Pratt 1996 $280,000 $154,600 $1,300 None $200,235 President 1995 $269,000 $148,000 None None $201,240 1994 $259,000 $130,000 None None $202,070 Richard O. Ballentine 1996 $160,000 $80,000 $1,050 None $20,235 Vice President, 1995 $154,000 $77,000 $360 None $19,845 General Counsel, 1994 $149,000 $75,000 None None $21,419 and Secretary John J. Holland 1996 $166,000 $83,500 $1,050 $15,750 $46,235 Vice President- 1995 $158,000 $79,000 $700 None $46,135 Finance 1994 $149,000 $75,000 None None $46,846 Richard S. Jarman 1996 $201,000 $101,000 $2,850 None $225,428 President, Bldgs. 1995 $193,000 $97,000 $1,100 None $225,284 Division 1994 $187,000 $75,000 None None $225,408
(1) No stock options were granted in 1994, 1995, or 1996. Restricted stock of the value indicated was awarded to the named Executive upon his election to receive a portion of his annual bonus in Butler common stock as described under "Restricted Stock Bonus Program." The restricted stock vests on the third anniversary of the date of the award. Dividends are payable on the restricted stock. (2) - To offset its obligations under the Company's Supplemental Retirement Benefit Plan for executives whose retirement benefit cannot be fully funded through the Company's Base Retirement Plan for Salaried Employees, the Company has agreed to pay the premiums for policies of split dollar life insurance on the lives of such executives. Included in this column is the value of premiums paid in 1996 for Mr. West of $291,000, for Mr. Pratt of $197,000, for Mr. Ballentine of $17,000, for Mr. Holland of $43,000 and for Mr. Jarman of $223,000. - Includes $775 for the Company's 1996 contribution to the Employee Stock Ownership Plan Trust and forfeitures allocated for each named executive officer's account. - Includes $210 for insurance premiums paid by the Company in 1996 with respect to term life insurance for each named executive officer. - Includes the Company's 25% matching contribution for 1996 to the named executive officer's account in the Butler Employees' Savings Trust (a 401(k) plan). $2,250 was allocated to Mr. West's account, $2,250 to Mr. Pratt's, $2,250 to Mr. Ballentine's, $2,250 to Mr. Holland's and $1,443 to Mr. Jarman's. 11 14 AGGREGATED OPTION/SAR EXERCISES AND FISCAL YEAR-END OPTION/SAR VALUE TABLE The following table sets out the number of exercised and unexercised options and the value of all such in-the-money options held by the named executive officers at December 31, 1996. The Company has no Stock Appreciation Rights (SARs) outstanding. Shares 1996 Stock Number of Unexercised Value of Unexercised Acquired Option Exercises Options In-The-Money Options Name On Exercise Value at December 31, 1996 at December 31, 1996 (1) (#) Realized (1) Exercisable Unexercisable Exercisable Unexercisable R. H. West 0 $0 0 0 $0 $0 D. H. Pratt 0 $0 0 0 $0 $0 R. Ballentine 5,430 $147,138 4,837 0 $141,869 $0 J. H. Holland 5,000 $116,650 10,000 0 $293,300 $0 R. S. Jarman 12,745 $310,585 46,475 0 $1,360,060 $0
(1) Reflects the amount by which the fair market value of Butler stock exceeded (in the case of exercised options) or exceeds (in the case of unexercised options) the option price. At December 31, 1996, the Company's stock price was $40.50. PENSION PLAN TABLE The following table shows estimated annual benefits payable upon retirement at age 65 to salaried employees in the specified compensation and years of service classifications. Average compensation generally means income reported on Federal Income Tax withholding statements each year, including salary, bonus, and other annual compensation but excluding relocation expenses, and contributions the Company makes to provide benefits under other employee benefit plans. The average compensation is the employee's average compensation for the five consecutive calendar years in which compensation is the highest during the participant's entire completed calendar years of continuous employment. Benefits are calculated on the assumption that the benefits will be payable over the participant's lifetime and that no survivor benefits (which would reduce the benefit shown) are to be paid. The benefits shown in the table are subject to a deduction for the monthly income value of ESOP benefits and of the cash value or death benefits of split dollar life insurance, if any. Average compensation and years of credited service for the individuals named in the compensation table at December 31, 1996 were: Mr. Ballentine, $185,071 and 22 years; Mr. Jarman, $225,357 and 22 years; Mr. Pratt, $325,502 and 32 years; Mr. Holland, $186,486 and 17 years; and Mr. West, $426,470 and 28 years. 12 15
ESTIMATED ANNUAL PENSION FOR YEARS OF CREDITED SERVICE ---------------------------------- AVERAGE COMPENSATION 10 20 30 40 - -------------------- -- -- -- -- 150,000 23,200 46,500 69,700 93,700 200,000 31,500 63,000 94,400 126,700 250,000 39,700 79,500 119,200 159,700 300,000 48,000 96,000 143,900 192,700 350,000 56,200 112,500 168,700 225,700 400,000 64,500 129,000 193,400 258,700 450,000 72,700 145,500 218,200 291,700 500,000 81,000 162,000 242,900 324,700 550,000 89,200 178,500 267,700 357,700
DEFERRED COMPENSATION PLAN The Company has an executive deferred compensation plan that allows a small number of executives (approximately 60) to defer up to 25% of their annual compensation and up to 100% of any incentive pay. The amount deferred is credited with interest at the end of each calendar year. Participants must defer their compensation until a specified date, their retirement, termination of employment or a change in control of the Company (as defined) and may elect to take the balance of their deferred cash account at the end of the deferral period in a lump sum or in monthly payments. They must begin taking payments from their account no later than age 70. Messrs. West, Ballentine, Holland and Jarman participated in this Plan in 1996. CHANGE OF CONTROL EMPLOYMENT AGREEMENTS The Company has Change of Control Employment Agreements with six executive officers, including Messrs Ballentine, Holland, Pratt and West. The Agreements provide that upon a change of control (as defined in the Agreements), the executive shall be entitled to receive until the third anniversary of the change in control a base salary, annual cash bonuses and other fringe benefits at the highest levels provided to the executive during certain periods immediately preceding the change in control. Upon a termination of the executive other than for cause, or upon the executive's resignation for good reason (as defined) or resignation during a thirty (30) day period following the first anniversary of the change of control, the executive is entitled to receive a lump sum cash payment consisting of (a) the executive's base salary through the date of termination, (b) a proportionate bonus based upon the executive's annual bonus for the last three fiscal years, (c) three times the sum of the base salary plus bonus the executive is entitled to under the Agreement, (d) other accrued obligations, and (e) the difference between the actuarial equivalent of the retirement benefit the executive would receive if he remained employed for the Employment Period and the actuarial equivalent of the executive's actual retirement benefit. In addition, for the remainder of the Employment Period, the executive is entitled to continued employee welfare benefits, including life and family health insurance. If any payment to the executive, whether pursuant to the Agreement or otherwise would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, then the executive shall be entitled to receive an additional payment equal to the excise tax and other taxes with respect thereto. The Agreements continue for a three year term with provision for automatic renewal. Benefits are provided subsequent to the expiration of the Agreement if a change of control occurs during the initial or any renewal term. 13 16 RESTRICTED STOCK BONUS PROGRAM The Company has a Restricted Stock Bonus Program that allows approximately 15 senior executives, including Messrs. Ballentine, Holland, Jarman and Pratt, to elect to receive up to 50% of their annual bonus in the Company's common stock ("Bonus Stock"). If the eligible executive makes such an election, the Company will match the Bonus Stock at a 50% rate ("Match Stock"). The Match Stock is restricted and not transferable for 3 years. If the Executive's employment is terminated prior to the end of 3 years (other than due to retirement, disability, or a change of control of the Company), or if the Executive transfers his or her Bonus Stock during the 3-year period, the Match Stock will be forfeited. The principal purpose of the Program is to increase share ownership among senior executives and encourage close identity of interests among them and shareholders. 14 17 PERFORMANCE GRAPH The following line graph compares, for five years, beginning December 31, 1991, the yearly percentage change in the Company's cumulative total shareholder return with the CRSP (Center for Research in Security Prices) New York Stock Exchange (NYSE) Stock Market Index, the CRSP NASDAQ Stock Market Total Return Index and the Media General "Other Building Material Group" Index. The graph assumes $100 invested at December 31, 1991 and reinvestment of dividends. The Company's stock was traded on the NASDAQ market until November 12, 1996 when it became listed on the NYSE. Indices for both markets are shown. The Media General Other Building Material Group index is an industry index published by Media General Financial Services which includes the Company. This index is only generally related to the Company's markets. Three of the Company's direct competitors, American Buildings Company, NCI Building Systems, Inc. and United Dominion Industries, Ltd. whose Varco-Pruden division competes with the Company, are included, but CECO and Star Buildings, a division of Robertson-CECO Corporation is not. Conversely, the Media General index includes firms such as Armstrong World Industries, Inc., Owens Corning Fiberglas Corporation, USG Corporation and Republic Group, Inc., whose products do not compete with the Company's. VALUE OF $100 INVESTMENTS ASSUMING REINVESTMENT OF DIVIDENDS AT END OF YEAR [LINE GRAPH]
1991 1992 1993 1994 1995 1996 Butler $100.00 $127.06 $255.29 $314.86 $564.34 $590.40 NASDAQ $100.00 $100.98 $121.13 $127.17 $164.96 $204.98 NYSE $100.00 $108.80 $120.10 $120.10 $162.80 $197.40 Media General $100.00 $124.44 $153.07 $135.31 $179.17 $199.09
15 18 INDEPENDENT PUBLIC ACCOUNTANTS Representatives of KPMG Peat Marwick, independent certified public accountants which audited the books, records and accounts of the Company for 1996, will be present at the stockholders meeting. They will have the opportunity to make a statement and will be available to respond to appropriate questions. The selection of the independent certified public accountants to audit the books, records and accounts of the Company for 1997 will be made by the Directors at its April, 1997 meeting based upon the recommendation of the Audit Committee, which consists of Messrs. Cook (chairman), Hallene, Novello, Powell, Reintjes and Ms. Rogala. PROXY SOLICITATIONS AND OTHER MATTERS The cost of soliciting proxies will be borne by the Company. The Company will reimburse brokers, banks or other persons for reasonable expenses in sending proxy material to beneficial owners. Proxies may be solicited through the mail and through telephonic or telegraphic communications to, or by meetings with, stockholders or their representatives by present and former directors, officers and other employees of the Company who will receive no additional compensation therefor. Stockholders who intend to present proposals for inclusion in the Company's proxy statement for the next annual meeting of stockholders on April 14, 1998, must forward them to the Company at BMA Tower (P.O. Box 419917), Penn Valley Park, Kansas City, Missouri 64141-0917, Attention: Secretary, so that they are received not later than February 4, 1998. By the Order of the Board of Directors March 10, 1997 Richard O. Ballentine, Secretary 16 19 ---------------------------- BUTLER MANUFACTURING COMPANY ---------------- NOTICE OF ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENT ---------------- TIME AND PLACE Tuesday, April 15, 1997 9:30 a.m. Atkins Auditorium Nelson-Atkins Museum of Art 4525 Oak Street Kansas City, Missouri ---------------------------- 20 [BUTLER LETTERHEAD] March 10, 1997 TO: Participants in one or more of the following; 1) Butler Manufacturing Company Employee Stock Ownership Plan Trust (ESOP) 2) Butler Employee Savings Trust (BEST) 3) Galesburg Hourly Employee Savings Trust (GHEST) The shares shown on the enclosed instruction card are credited to your stock account in the ESOP and/or in the Butler Common Stock Fund of the BEST or GHEST. In accord with the terms of the Plans, participants have the right to instruct each Plan's Trustee how these shares will be voted at any meeting of stockholders. To assist in that process, the Company's Annual Report to Stockholders for 1996 and a Proxy Statement for its Annual Meeting are either enclosed with this letter or, if you own stock in your own name, have been mailed to you. PLEASE USE THE ENCLOSED INSTRUCTION CARD TO INSTRUCT THE TRUSTEE(S) HOW TO VOTE. Please put your instruction card in the white envelope enclosed for your convenience and deposit it in the place provided by your Human Resources Department for transmittal to UMB Bank, the Company's stock transfer agent. UMB Bank will tabulate votes and submit the results to the Trustees. Your instruction card will be furnished to the appropriate Trustee with the instructions of other participants. If you prefer, you may mail your card directly to UMB Bank in the enclosed envelope. In any event, your voting instructions to the Trustee will be kept confidential and will not be communicated to the Company or any director, officer or employee of the Company or any affiliated company. If the card is returned signed without direction or no card is received, the shares will be voted in the same proportion as the Trustee has been instructed to vote by participants giving valid instructions. We suggest that you mail the instructions by March 28, 1997, to allow the Trustee time to vote the shares according to your instructions. The Company invites you to attend the Annual Meeting of Stockholders which will be held in Kansas City, Missouri, at Atkins Auditorium, Nelson-Atkins Museum of Art, 4525 Oak Street on April 15, 1997, at 9:30 a.m. Cordially yours, BUTLER MANUFACTURING COMPANY BUTLER EMPLOYEE SAVNGS TRUST (BEST) EMPLOYEE STOCK OWNERSHIP PLAN TRUST (ESOP) GALESBURG HOURLY EMPLOYEE SAVINGS TRUST Boatmen's Trust Company of Kansas Fidelity Management Trust Company, City, Trustee Trustee Enclosures 21 [BUTLER LOGO] INSTRUCTION CARD INSTRUCTIONS TO: Boatmen's Trust Company of Kansas City, Trustee of the Butler Manufacturing Company Employee Stock Ownership Plan Trust (ESOP) and Fidelity Management Trust Company, Trusteee of the Butler Employee Savings Trust (BEST) and Galesburg Hourly Employee Savings Trust (GHEST), for voting at the Annual Meeting of Stockholders of Butler Manufacturing Company on April 15, 1977. Please vote the shares held by you for my ESOP stock account and/or Butler Common Stock Fund as specified below. 1. Election of three Class B Directors - Nominees; ROBERT E. COOK, ROBERT J. REINTJES, SR., JUDITH A. ROGALA [] FOR all Nominees. [] AUTHORITY WITHHELD from all Nominees. [] FOR all nominees, except vote withheld for the following Nominee(s): ------------------------------------------------------------------- 2. In your discretion, you are authorized to vote upon such other business as may properly come before the meeting. The Board of Directors recommends a vote FOR the Director Nominees. BE SURE TO SIGN AND DATE THE REVERSE SIDE OF THIS CARD (See reverse side for matters to be voted on) The undersigned has received the Company's Annual Report for 1996 and its Proxy Statement. IF THE INSTRUCTION CARD IS NOT RETURNED OR IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED INSTRUCTION CARD IS RETURNED, THE SHARES CREDITED IN THE ESOP STOCK ACCOUNT AND/OR THE BEST OR GHEST BUTLER COMMON STOCK FUND WILL BE VOTED ON EACH BALLOT ITEM IN THE SAME PROPORTION AS THE TRUSTEE HAS BEEN INSTRUCTED TO VOTE BY PARTICIPANTS GIVING VALID INSTRUCTIONS. -------------------------------------- Participant's Signature -------------------------------------- Date (Please complete, date and sign exactly as your name appears. RETURN CARD PROMPTLY IN ACCOMPANYING ENVELOPE.) -----END PRIVACY-ENHANCED MESSAGE-----