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OMB APPROVAL |
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OMB Number:
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3235-0059 |
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Expires:
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February 28, 2006 |
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Estimated average burden hours per
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12.75 |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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Filed by the Registrant x |
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Filed by a Party other than the Registrant o |
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Check the appropriate box: |
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o Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2)) |
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x Definitive Proxy Statement |
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o Definitive Additional Materials |
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Soliciting Material Pursuant to §240.14a-12 |
United States Lime & Minerals, 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):
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x No fee required. |
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o Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11. |
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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): |
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4) Proposed maximum aggregate value of transaction: |
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o Fee paid previously with preliminary materials. |
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o 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. |
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1) Amount Previously Paid: |
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2) Form, Schedule or Registration Statement No.: |
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SEC 1913 (11-01) |
Persons who are to respond to the collection of information
contained in this form are not required to respond unless the form displays a currently valid
OMB control number. |
United
States Lime & Minerals, Inc.
13800
Montfort Drive, Suite 330
Dallas,
Texas 75240
April 8, 2005
Dear Shareholders:
You are cordially invited to attend the 2005 Annual Meeting of
Shareholders at 10:00 a.m. on Wednesday, May 4, at the
Crowne Plaza Suites, 7800 Alpha Road, Dallas, Texas, 75240.
Please refer to the back of this letter for directions. The
Meeting will be preceded by an informal reception starting at
9:30 a.m., at which you will have an opportunity to meet
the Directors and Officers of the Company.
Enclosed with this letter is a Notice of the Annual Meeting,
Proxy Statement, and Proxy Card. I urge you to complete, sign,
date, and mail the enclosed Proxy Card at your earliest
convenience. Regardless of the size of your holdings, it is
important that your shares be represented. If you attend the
Meeting, you may withdraw your Proxy and vote in person. You may
also withdraw your Proxy by submitting to the Company, prior to
the Annual Meeting, a written notice of revocation.
I look forward to meeting and speaking with you at the Annual
Meeting on May 4, 2005.
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Sincerely, |
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Timothy W. Byrne |
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President and Chief Executive Officer |
Enclosures
TABLE OF CONTENTS
United States
Lime & Minerals, Inc.
Directions to the 2005
Annual Meeting of Shareholders
Wednesday, May 4,
2005, at 10:00 a.m.
Crowne Plaza
Suites
7800 Alpha
Road
Dallas, Texas
75240
Directions from Dallas-Ft. Worth Airport:
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Take the North exit from the airport |
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East on I-635 (Lyndon B. Johnson Freeway) |
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Exit at Coit Road, turning North (left) onto Coit |
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Turn left at first intersection onto Alpha Road |
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Hotel entrance is on the left before junction with Blossomheath
Road |
Directions from Downtown Dallas:
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North on North Central Expressway (U.S. 75) |
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Exit at Coit Road (exit passes over U.S. 75 and joins Coit) |
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Continue North on Coit until you cross over I-635 (Lyndon B.
Johnson Freeway) |
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Turn left at first intersection onto Alpha Road |
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Hotel entrance is on the left before junction with Blossomheath
Road |
UNITED STATES LIME & MINERALS, INC.
13800 Montfort Drive
Suite 330
Dallas, Texas 75240
NOTICE OF 2005 ANNUAL MEETING OF SHAREHOLDERS
To Be Held On May 4, 2005
To the Shareholders of
United States Lime & Minerals, Inc.:
Notice is hereby given that the 2005 Annual Meeting of
Shareholders of United States Lime & Minerals, Inc., a
Texas corporation (the Company), will be held on
Wednesday, the 4th day of May, 2005, at 10:00 a.m.,
local time at the Crowne Plaza Suites, 7800 Alpha Road, Dallas,
Texas 75240 (the Annual Meeting), for the following
purposes:
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1. To elect five directors to serve until the next annual
meeting of shareholders and until their respective successors
have been duly elected and qualified; and |
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2. To transact such other business as may properly be
brought before the Annual Meeting or any adjournment thereof. |
Information regarding the matters to be acted upon at the Annual
Meeting is contained in the Proxy Statement accompanying this
Notice.
The Board of Directors has fixed the close of business on
March 31, 2005 as the record date for the determination of
shareholders entitled to notice of and to vote at the Annual
Meeting or any adjournment thereof. Only shareholders of record
at the close of business on the record date are entitled to
notice of and to vote at the Annual Meeting or any adjournment
thereof. A complete list of such shareholders will be available
for inspection during usual business hours for ten days prior to
the Annual Meeting at the office of the Company in Dallas, Texas.
All shareholders are cordially invited to attend the Annual
Meeting. Shareholders are urged, whether or not they plan to
attend the Annual Meeting, to complete, sign, and date the
accompanying Proxy Card and to return it promptly in the
postage-paid return envelope provided. A shareholder who has
returned a Proxy Card may withdraw the Proxy by sending the
Company a written notice of revocation or by attending the
Annual Meeting and voting in person.
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By Order of the Board of Directors, |
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Timothy W. Byrne |
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President and Chief Executive Officer |
Dallas, Texas
April 8, 2005
UNITED STATES LIME & MINERALS, INC.
13800 Montfort Drive
Suite 330
Dallas, Texas 75240
PROXY STATEMENT
FOR
2005 ANNUAL MEETING OF SHAREHOLDERS
To Be Held On May 4, 2005
INTRODUCTION
The accompanying form of proxy (the Proxy Card),
mailed together with this proxy statement (the Proxy
Statement), is solicited by and on behalf of the Board of
Directors of United States Lime & Minerals, Inc., a
Texas corporation (the Company), for use at the 2005
Annual Meeting of Shareholders of the Company (the Annual
Meeting) to be held at the time and place and for the
purposes set forth in the accompanying Notice. The approximate
date on which this Proxy Statement and the Proxy Card were first
sent to shareholders of the Company is April 8, 2005.
Shares of the Companys common stock, par value
$0.10 per share (the Common Stock), represented
by valid Proxy Cards, duly signed, dated, and returned to the
Company and not revoked, will be voted at the Annual Meeting in
accordance with the directions given. In the absence of
directions to the contrary, such shares will be voted:
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FOR the election of the five nominees named in the Proxy Card to
the Board of Directors of the Company. |
If any other matter is properly brought before the Annual
Meeting for action at the Meeting, which is not currently
anticipated, the persons designated to serve as proxies will
vote on such matters in accordance with their best judgment.
Any shareholder of the Company returning a Proxy Card has a
right to withdraw the Proxy at any time before it is exercised
by attending the Annual Meeting and voting in person or by
giving written notice of such revocation to the Company
addressed to Timothy W. Byrne, President and Chief Executive
Officer, United States Lime & Minerals, Inc., 13800
Montfort Drive, Suite 330, Dallas, Texas 75240; however, no
such revocation shall be effective unless such notice of
revocation has been received by the Company at or prior to the
Annual Meeting.
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
Only holders of record of Common Stock at the close of business
on March 31, 2005, the record date for the Annual Meeting,
are entitled to notice of and to vote at the Annual Meeting or
any adjournment thereof. The presence of the holders of a
majority of the outstanding shares of Common Stock is necessary
to constitute a quorum. On the record date for the Annual
Meeting, there were issued and outstanding 5,876,338 shares
of Common Stock. At the Annual Meeting, each shareholder of
record on March 31, 2005 will be entitled to one vote for
each share of Common Stock registered in such shareholders
name on the record date.
The following table sets forth, as of March 31, 2005,
information with respect to shareholders known to the Company to
be the beneficial owners of more than five percent of the issued
and outstanding shares of Common Stock:
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Number of Shares | |
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Percent | |
Name and Address of Beneficial Owner |
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Beneficially Owned(2)(3) | |
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of Class(2) | |
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Inberdon Enterprises Ltd.
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3,542,033 |
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59.63 |
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1020-789 West Pender Street
Vancouver, British Columbia
Canada V6C 1H2(1) |
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Robert S. Beall
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685,258 |
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11.59 |
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5300 Miramar Lane
Colleyville, Texas 76034 |
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(1) |
Inberdon Enterprises Ltd. (Inberdon) is principally
engaged in the acquisition and holding of securities of
aggregate producing companies located in North America. All of
the outstanding shares of Inberdon are held, indirectly through
a number of private companies, by Mr. George M. Doumet. |
(2) |
In the case of Inberdon, based on the Companys records as
of March 31, 2005. In the case of Robert S. Beall, based on
his Form 4 filed on November 3, 2004, reporting shares
as of November 2, 2004. Assuming Robert S. Beall continued
to own 685,258 shares on March 31, 2005, such shares
would represent 11.59% of the class as of such date. |
(3) |
Includes the following shares subject to purchase pursuant to
warrants exercisable within the next 60 days: Inberdon,
63,643; and Robert S. Beall, 37,714. |
SHAREHOLDINGS OF COMPANY DIRECTORS AND EXECUTIVE OFFICERS
The table below sets forth the number of shares of Common Stock
beneficially owned, as of March 31, 2005, by all directors
and named executive officers of the Company individually and all
directors and executive officers as a group:
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Number of Shares | |
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Percent | |
Name |
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Beneficially Owned(1) | |
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of Class | |
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Timothy W. Byrne
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138,469 |
(2)(4) |
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2.32 |
% |
Richard W. Cardin
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6,000 |
(4) |
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(5) |
Antoine M. Doumet
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4,000 |
(3)(4) |
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(5) |
Wallace G. Irmscher
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12,308 |
(4) |
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(5) |
Edward A. Odishaw
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11,400 |
(4) |
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(5) |
Johnney G. Bowers
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22,993 |
(2)(4) |
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(5) |
Billy R. Hughes
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69,563 |
(2)(4) |
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1.16 |
% |
Richard D. Murray
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39,500 |
(2)(4) |
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(5) |
M. Michael Owens
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8,300 |
(4) |
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(5) |
All Directors and Executive Officers as a Group (9 persons)
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312,533 |
(2)(4) |
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5.11 |
% |
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(1) |
All shares are directly held with sole voting and dispositive
power unless otherwise indicated. |
(2) |
Includes 6,845, 493, 3,860, and 500 shares allocated to
Messrs. Byrne, Bowers, Hughes, and Murray, respectively,
under the Companys Employee Stock Ownership Plan
(ESOP), which was merged with the Companys
401(k) profit-sharing plan effective July 31, 1999. |
(3) |
The named individual is the brother of Mr. George M.
Doumet, who indirectly owns all the outstanding shares of
Inberdon. |
(4) |
Includes the following shares subject to stock options
exercisable within the next 60 days granted under the 1992
Stock Option Plan, as Amended and Restated (the 1992
Plan), or the 2001 Long-Term Incentive Plan (the
2001 Plan): Mr. Byrne, 101,190;
Mr. Cardin, 4,000; Mr. Doumet, 4,000;
Mr. Irmscher, 2,000; Mr. Odishaw, 4,000;
Mr. Bowers, 22,500; Mr. Hughes, 44,500;
Mr. Murray, 39,000; and Mr. Owens, 3,500. |
(5) |
Less than 1%. |
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PROPOSAL 1:
ELECTION OF DIRECTORS
Five directors, constituting the entire Board of Directors, are
to be elected at the Annual Meeting to serve until the next
annual meeting of shareholders and until their respective
successors have been duly elected and qualified. All of the
nominees are currently directors of the Company.
Directors are elected by a plurality of the votes cast by the
holders of shares entitled to vote in the election of directors
at the Annual Meeting. The Companys Restated Articles of
Incorporation prohibit cumulative voting for the election of
directors. All duly submitted and unrevoked Proxy Cards will be
voted FOR the nominees selected by the Board of Directors except
where authorization so to vote is withheld. Votes withheld and
broker non-votes are not counted in the election of directors.
The Board of Directors recommends that all shareholders vote
FOR the election of all such nominees. If any
nominee should become unavailable for election for any presently
unforeseen reason, the persons designated to serve as proxies
will have full discretion to vote for another person nominated
by the Board.
NOMINEES FOR DIRECTOR
The five nominees for director are named below. Each has
consented to serve as a director if elected. Set forth below is
pertinent information with respect to each nominee:
Timothy W. Byrne Mr. Byrne, age 47, rejoined
the Company on December 8, 2000 as its President and Chief
Executive Officer, positions he previously held during 1997 and
1998. Mr. Byrne has served the Company as a director since
March 1991, and served in various positions including Senior
Vice President and Chief Financial Officer and Vice President of
Finance and Administration from 1990 to 1998. Prior to rejoining
the Company in December 2000, Mr. Byrne was President of
Rainmaker Interactive, Inc., an Internet services and
communications company focused on strategy, marketing, and
technology.
Richard W. Cardin Mr. Cardin, age 69, has
served as a director of the Company since August 1998. He is a
Certified Public Accountant and retired partner of Arthur
Andersen LLP since 1995, having spent 37 years with that
firm. He was Office Managing partner with Arthur Andersen LLP in
Nashville, Tennessee from 1980 until 1994. He is a member of the
Board of Directors of Atmos Energy Corporation, a natural gas
utility company, and Intergraph Corporation, a leading global
provider of spatial information management software and services.
Antoine M. Doumet Mr. Doumet, age 45, has
served as a director of the Company since July 1993 in the
capacity of Vice Chairman. He is a private businessman and
investor. From 1989 to 1995, he served as a director of MELEC, a
French electrical engineering and contracting company. From 1988
to 1992, Mr. Doumet served as vice president and a director
of Lebanon Chemicals Company. Mr. Doumet is the brother of
Mr. George M. Doumet, who indirectly owns all of the
outstanding shares of Inberdon.
Wallace G. Irmscher Mr. Irmscher, age 82, has
served as a director of the Company since July 1993. He was a
senior executive with 44 years of diversified experience in
the construction and construction materials industry. From 1995
to 2003, Mr. Irmscher served as a director of N-Viro
International Corporation, a company involved in the recycling
of industrial waste. He also serves as an advisory board member
of U.S. Concrete, Inc., a producer of construction
materials. He is past Chairman of the American Concrete Paving
Association (ACPA) and is presently a board member of the
National Ready Mix Concrete Association (NRMCA).
Mr. Irmscher has performed consulting services for various
companies in the cement, construction, and environmental
industries.
Edward A. Odishaw Mr. Odishaw, age 69, has
served as a director and Chairman of the Board of the Company
since July 1993. Mr. Odishaw is Chairman of Austpro Energy
Corporation, a public Canadian corporation. Between 1964 and
1999, he practiced law in Saskatchewan and British Columbia,
Canada, with emphasis on commercial law, corporate mergers,
acquisitions, and finance. Between 1992 and 1999,
Mr. Odishaw was a Barrister and Solicitor with the law firm
of Boughton Peterson Yang Anderson, located in
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Vancouver, Canada. From 1972 to 1992, Mr. Odishaw was a
Barrister and Solicitor with the law firm of Swinton &
Company, Vancouver, Canada. Mr. Odishaw holds directorships
in numerous companies in Canada. Mr. Odishaw is a member in
good standing of the Law Society of British Columbia and is a
non-practicing member of the Law Society of Saskatchewan.
EXECUTIVE OFFICERS
WHO ARE NOT ALSO DIRECTORS
Johnney G. Bowers Mr. Bowers, age 58, joined
the Company in June 1997 and has served as Vice
President Manufacturing since that date. He has over
30 years of engineering and operating experience. From May
1991 until he joined the Company, Mr. Bowers served as
Director of Engineering with Chemical Lime Company. Prior to May
1991, Mr. Bowers held various senior process engineering
and project manager positions in the mining and processing
industry.
Billy R. Hughes Mr. Hughes, age 66, joined the
Company in June 1973 and has served as Senior Vice
President Sales & Marketing since December
1998. He has more than 30 years of experience in the lime
and limestone industry. Mr. Hughes began his employment
with the Company as a salesperson for the Arkansas Lime plant.
In 1978, he was promoted to sales manager for Arkansas Lime. In
1983, Mr. Hughes was appointed Vice President
Sales and Marketing for both Arkansas Lime and Texas Lime.
Richard D. Murray Mr. Murray, age 64, joined
the Company in May 1995 and served as Vice President
Engineering until March 2001, when he was appointed Vice
President and Plant Manager for Texas Lime Company. He has over
35 years of experience in various management and
engineering positions. Prior to joining the Company, he was Vice
President Operations for Lone Star Industries, Inc.,
a leading cement manufacturer.
M. Michael Owens Mr. Owens, age 51, joined
the Company in August 2002 as its Vice President and Chief
Financial Officer, Secretary and Treasurer. He has over
25 years of financial and accounting experience. Prior to
joining the Company, Mr. Owens was Vice
President Finance at Sunshine Mining and Refining
Company (Sunshine), a silver mining company.
Mr. Owens held various financial and accounting officer
positions with Sunshine from 1983 to 2002.
CORPORATE GOVERNANCE
The Company has adopted corporate governance practices in
accordance with the listing standards of The Nasdaq Stock Market
and commensurate with its size and stage of development.
The Board consists of five directors. The Board has determined
that Messrs. Odishaw, Cardin, Doumet and Irmscher are
independent within the meaning of the Nasdaq rules. The fifth
director is Mr. Byrne, the Companys President and
Chief Executive Officer.
The Board meets at least four times each year, and more
frequently as required, and is responsible for supervising the
management of the business and affairs of the Company, including
the development of major policy and strategy. The Board has a
standing Executive Committee, Nominating and Corporate
Governance Committee, Audit Committee and Compensation Committee.
During the year ended December 31, 2004, the Board held six
meetings, the Executive Committee held one meeting, the Audit
Committee held eight meetings, the Compensation Committee held
four meetings, and the Nominating and Corporate Governance
Committee held two meetings. During the year ended
December 31, 2004, each director attended at least 75% of
the aggregate of (a) the total number of meetings held by
the Board and (b) the total number of meetings held by all
Committees on which he served. The Board has a policy
encouraging each director to attend the Companys annual
meeting of shareholders, and all of the Companys directors
attended the 2004 annual meeting. The Board also has a policy
that, in conjunction with each regularly scheduled meeting of
the Board, the Boards independent directors will meet in
executive session.
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Governance responsibilities are undertaken by the Board as a
whole, with certain specific responsibilities delegated to the
four Committees as described below:
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The Executive Committee is composed of Messrs. Odishaw
(Chairman), Doumet and Byrne. Within the policy and strategic
direction provided by the Board, the Executive Committee may
exercise all of the powers of the Board, except those required
by law, regulation or Nasdaq listing standards to be exercised
by the full Board, or another Committee of the Board, and is
required to report to the Board on all matters considered and
actions taken since the last meeting of the full Board. |
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The Nominating and Corporate Governance Committee (the
Nominating Committee) is composed of
Messrs. Odishaw (Chairman), Cardin, Doumet and Irmscher,
each of whom is an independent director. The primary purposes of
the Nominating Committee are to identify and recommend
individuals to serve as members of the Board, to recommend to
the Board the duties and responsibilities and members of each
Committee, and to assist the Board with other matters to ensure
effective corporate governance. The Nominating Committee is
responsible for establishing the Boards procedures for
consideration of director nominees from shareholders and the
Boards process for shareholder communications with the
Board. The Nominating Committee will consider qualified
candidates for nomination for election to the Board recommended
by the Companys directors, officers and shareholders. In
considering all such candidates, the Nominating Committee will
take into account the candidates qualifications and the
size, composition and needs of the Board, in the following areas
of experience, judgment, expertise, and skills: the
Companys industry; accounting and finance; business
judgment; management; leadership; business strategy; risk
management; and corporate governance. All candidates should have
a reputation for integrity, have experience in positions with a
high degree of responsibility, be leaders in the companies,
institutions, or professions with which they have been
affiliated, and be capable of making a contribution to the
Company. Shareholders wishing to recommend a director candidate
for consideration by the Nominating Committee should send all
relevant information with respect to the individual to the
Chairman of the Committee, at the address of the Companys
executive offices. A copy of the Nominating Committees
Charter, which was adopted by the Board effective March 25,
2004, and the Boards process for shareholders to send
communications to the Board are available on the Companys
website located at www.uslm.com. |
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The Audit Committee is composed of Messrs. Cardin
(Chairman), Irmscher and Odishaw. The Board has determined that
each member of the Audit Committee is independent and meets the
other qualification standards set by law, regulation and
applicable Nasdaq listing standards. Based on his past
education, employment experience and professional certification
in public accounting, the Board has determined that
Mr. Cardin qualifies as an audit committee financial expert
as defined by the Securities and Exchange Commission (the
SEC). The Audit Committee is directly responsible
for the appointment, compensation, retention and oversight of
the work of the Companys Independent Registered Public
Accounting Firm (independent auditors). The Audit
Committee is also responsible for overseeing the administration
of the Companys Code of Business Conduct and Ethics, which
is available on the Companys website located at
www.uslm.com; reviewing and approving all related-party
transactions; and administering the Companys procedures
for the receipt, retention, and treatment of complaints
regarding accounting, internal accounting controls and auditing
matters and for the confidential anonymous submission by
employees of the Company of concerns regarding questionable
accounting or auditing matters. The Audit Committee has adopted
a written charter, which is available on the Companys
website located at www.uslm.com. The Audit Committee
reviews and assesses the adequacy of the charter on an annual
basis. The Report of the Audit Committee is set forth below. |
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The Compensation Committee is composed of three independent
directors, Messrs. Odishaw (Chairman), Irmscher, and
Doumet. The Compensation Committee is responsible for the
evaluation, approval, and administration of salary, incentive
compensation, bonuses, benefit plans, and other forms of
compensation for the Companys officers and directors. The
Compensation Committee is responsible for administering the 1992
Plan and the 2001 Plan. The Report of the Compensation Committee
follows the Report of the Audit Committee. |
5
Notwithstanding anything to the contrary, the following reports
of the Audit Committee and the Compensation Committee and the
Performance Graph set forth below shall not be deemed to be
incorporated by reference by any general statement incorporating
by reference the Proxy Statement into any filing under the
Securities Act of 1933 or the Securities Exchange Act of 1934,
except to the extent that the Company specifically incorporates
this information by reference. This information shall not
otherwise be deemed to be filed under such Acts.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee is composed of three independent directors
as defined under the applicable rules of The Nasdaq Stock
Market, Section 10A(m)(3) of the Securities Exchange Act of
1934, and the rules and regulations of the Securities and
Exchange Commission (the SEC). The Committee
oversees the Companys financial reporting process on
behalf of the Board of Directors. The Audit Committee is
directly responsible for the appointment, compensation and
oversight of the work of the Independent Registered Public
Accounting Firm (independent auditors). Management
has primary responsibility for the Companys financial
statements and reporting process, including the systems of
internal controls. Ernst & Young LLP, the
Companys independent auditors, is responsible for
performing an independent audit of the Companys financial
statements in accordance with standards established by the
Public Company Accounting Oversight Board, expressing an
opinion, based on its audit, as to the conformity of such
financial statements with accounting principles generally
accepted in the United States.
In the performance of its oversight function, the Audit
Committee has reviewed and discussed the audited financial
statements with management and the independent auditors. The
Audit Committee has discussed with the independent auditors the
matters required to be discussed by Statement on Auditing
Standards No. 61 (Communication with Audit Committees), as
amended by Statement on Auditing Standards No. 90 (Audit
Committee Communications). In addition, the Audit Committee has
received from the independent auditors the written disclosures
required by the pronouncements on the Independence Standards
Board and discussed with them their independence from the
Company and its management. The Audit Committee has considered
whether the independent auditors provision of non-audit
services to the Company is compatible with the auditors
independence.
The Audit Committee meets with the independent auditors, with
and without management present, to discuss the results of their
examinations, their evaluations of the Companys internal
controls, and the overall quality of the Companys
financial reporting.
Based on the reviews and discussions referred to above, the
Audit Committee recommended and the Board of Directors has
approved the inclusion of the Companys audited financial
statements in the Annual Report on Form 10-K for the year
ended December 31, 2004, for filing with the SEC.
Respectfully submitted by the members of the Audit Committee of
the Board of Directors,
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Richard W. Cardin, Chairman |
|
Wallace G. Irmscher |
|
Edward A. Odishaw |
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Board of Directors (the
Committee) has the responsibility for administering
the executive compensation program of the Company. The
Compensation Committee reviews and makes recommendations to the
full Board of Directors regarding the base salaries and annual
incentive compensation for executive officers, and administers
the Companys 1992 Stock Option Plan, as Amended and
Restated (the 1992 Plan), and the Companys
2001 Long-Term Incentive Plan (the 2001 Plan).
Compensation Policies. The principal executive
compensation policy of the Company, which is endorsed by the
Committee, is to provide a compensation program that will
attract, motivate, and retain
6
persons of high quality and will support a long-standing
internal culture of loyalty and dedication to the interests of
the Company and its shareholders. In administering the executive
compensation program, the Committee is mindful of the following
principles and guidelines which are supported by the full Board:
Base salaries for executive officers should be competitive. A
sufficient portion of annual compensation should be at risk in
order to align the interests of executives with those of the
shareholders of the Company. This variable part of annual
compensation should reflect both individual and corporate
performance. As a persons level of responsibility
increases, a greater portion of total compensation should be at
risk, and the mix of total compensation should be weighted more
heavily in favor of stock-based compensation. Stock options,
restricted stock, and other stock-based compensation provide
executives long-term incentive and help align the interests of
executives and shareholders in the enhancement of shareholder
value.
As discussed elsewhere in the Proxy Statement, the Company has
entered into employment agreements with Messrs. Byrne,
Hughes, and Bowers. These agreements provide for an annual base
salary, bonuses, the use of a Company car, reimbursement of
business expenses, participation in the 401(k) profit-sharing
plan, severance arrangements, and other benefits. The Committee
has determined that such agreements are appropriate means to
achieve the Companys overall compensation policies.
2004 Compensation. The Companys executive
compensation packages have three separate elements consisting of
base salary, annual incentive compensation and long-term
incentive compensation. The compensation packages of
Mr. Byrne and the other executive officers are designed to
be competitive within the industry and to provide incentives for
both short- and long-term performance in line with the financial
interests of the shareholders.
Base Salaries. The Committee determines levels of the
executive officers base salaries so as to be competitive
with amounts paid to executives performing similar functions in
comparable size non-durable manufacturing companies. The amount
of each executives annual increase in base salary, if any,
will be based on a number of largely subjective factors,
including the personal performance of such executive officer,
the performance of the Company, cost-of-living increases, and
such other factors as the Committee deems appropriate, including
the individuals overall mix between fixed and variable
compensation and between cash and stock-based compensation.
Executive officers, other than Mr. Byrne, received raises
in 2004 averaging approximately 2.4%. Mr. Byrnes 2004
base salary was $250,000, unchanged from 2003.
Annual Incentive Compensation. Each of the Companys
executive officers is eligible to receive annual cash bonus
awards based on determinations made by the Committee. Except in
the case of Mr. Byrne, the Company has not adopted a formal
annual bonus plan. Rather, the determination to pay a cash
bonus, if any, is based on the Committees subjective
judgment with respect to the past performance of the individual,
or on the individuals attainment of objective performance
goals. In either such case, the bonus may be based on the
specific accomplishments of the individual, or on the overall
success of the Company. The Committee awarded the following
bonuses for 2004, which were paid in 2005: Mr. Bowers,
$8,000; Mr. Hughes, $30,000; Mr. Murray, $30,000; and
Mr. Owens, $18,000.
As described elsewhere in the Proxy Statement,
Mr. Byrnes employment agreement provides for an
objective annual cash bonus based on the Companys EBITDA
(earnings before interest, taxes, depreciation, and
amortization) compared to certain EBITDA levels set forth in
Mr. Byrnes employment agreement, as well as the
possibility of a subjective cash bonus in the discretion of the
Committee. For 2004, the increase in the Companys EBITDA
resulted in Mr. Byrnes earning an objective bonus of
$250,000, which was paid in 2005. A subjective bonus of $50,000
was also awarded for 2004 and paid in 2005.
Long-Term Incentive Compensation. The Committee also
administers the 1992 Plan and the 2001 Plan to provide long-term
incentives to its key employees, including executive officers.
Grants of stock options, restricted shares of stock, and other
stock-based compensation are based on each individuals
position within the Company, level of responsibility, past
performance, and expectation of future performance. Stock
options granted during 2004 were: Mr. Byrne, 30,000;
Mr. Bowers, 1,500 Mr. Hughes, 5,000; Mr. Murray,
6,000; and Mr. Owens, 4,500.
7
Internal Revenue Code of 1986 (Code)
Section 162(m) generally limits the corporate income tax
deduction for compensation paid to certain named executive
officers to $1 million per year, except for certain
qualified and performance-based compensation. The Committee has
not seen any need to adopt a policy with regard to qualifying
bonus awards for tax deductibility under Code
Section 162(m), since Company cash compensation is well
below the level at which this tax limitation would apply, and
options that were granted in 1999 and thereafter under the 1992
Plan, as amended and restated in 1999, and that were or will be
granted under the 2001 Plan are intended to constitute
performance-based compensation not subject to the Code
Section 162(m) limitation.
|
|
|
COMPENSATION COMMITTEE |
|
|
Edward A. Odishaw, Chairman |
|
Antoine M. Doumet |
|
Wallace G. Irmscher |
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the cash and non-cash
compensation for each of the last three fiscal years earned by
the President and Chief Executive Officer, and the four other
executive officers of the Company:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-Term | |
|
|
|
|
|
|
|
|
|
|
Compensation | |
|
All Other | |
|
|
|
|
|
|
|
|
| |
|
Compensation | |
|
|
|
|
|
|
| |
|
|
Annual Compensation | |
|
Securities | |
|
|
|
|
| |
|
Underlying | |
|
All Other | |
Name and Principal Position |
|
Year | |
|
Salary | |
|
Bonus(1) | |
|
Options (#) | |
|
Compensation(2) | |
|
|
| |
|
| |
|
| |
|
| |
|
| |
Timothy W. Byrne
|
|
|
2004 |
|
|
$ |
250,000 |
|
|
$ |
250,000 |
|
|
|
30,000 |
|
|
$ |
34,100 |
|
|
President and Chief |
|
|
2003 |
|
|
$ |
250,000 |
|
|
$ |
100,000 |
|
|
|
30,000 |
|
|
$ |
4,000 |
|
|
Executive Officer |
|
|
2002 |
|
|
$ |
240,000 |
|
|
$ |
175,000 |
|
|
|
|
|
|
$ |
4,000 |
|
Billy R. Hughes
|
|
|
2004 |
|
|
$ |
161,667 |
|
|
$ |
30,000 |
|
|
|
5,000 |
|
|
$ |
3,318 |
|
|
Senior Vice President |
|
|
2003 |
|
|
$ |
157,833 |
|
|
$ |
7,500 |
|
|
|
10,000 |
|
|
$ |
3,234 |
|
|
Sales and Marketing |
|
|
2002 |
|
|
$ |
155,813 |
|
|
$ |
10,000 |
|
|
|
|
|
|
$ |
3,163 |
|
M. Michael Owens(3)
|
|
|
2004 |
|
|
$ |
120,708 |
|
|
$ |
15,000 |
|
|
|
4,500 |
|
|
$ |
2,508 |
|
|
Vice President and Chief |
|
|
2003 |
|
|
$ |
117,291 |
|
|
$ |
4,000 |
|
|
|
12,000 |
|
|
$ |
617 |
|
|
Financial Officer |
|
|
2002 |
|
|
$ |
45,337 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Johnney G. Bowers
|
|
|
2004 |
|
|
$ |
146,750 |
|
|
$ |
8,000 |
|
|
|
1,500 |
|
|
$ |
3,009 |
|
|
Vice President |
|
|
2003 |
|
|
$ |
143,830 |
|
|
$ |
2,000 |
|
|
|
|
|
|
$ |
2,976 |
|
|
Manufacturing |
|
|
2002 |
|
|
$ |
141,965 |
|
|
$ |
2,000 |
|
|
|
|
|
|
$ |
2,945 |
|
Richard Murray
|
|
|
2004 |
|
|
$ |
114,792 |
|
|
$ |
30,000 |
|
|
|
6,000 |
|
|
$ |
2,423 |
|
|
Vice President |
|
|
2003 |
|
|
$ |
112,291 |
|
|
$ |
5,000 |
|
|
|
6,000 |
|
|
$ |
2,360 |
|
|
Texas Lime |
|
|
2002 |
|
|
$ |
109,406 |
|
|
$ |
10,000 |
|
|
|
|
|
|
$ |
2,299 |
|
|
|
(1) |
Bonuses were earned in the previous year and paid in the year
shown. |
|
(2) |
Company contribution to defined contribution plan and, for
Mr. Byrne, $30,000 payment in lieu of the companys
obligation to fund a life insurance or retirement arrangement. |
|
(3) |
Mr. Owens was elected Vice President and Chief Financial
Officer on August 9, 2002. |
8
Option Grants in Last Fiscal Year
The following table sets forth information with respect to stock
options granted to the named executive officers during 2004 and
the potential realizable value at assumed annual rates of stock
price appreciation over the ten-year term of the options:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Potential Realizable | |
|
|
Individual Grants | |
|
Value at Assumed | |
|
|
| |
|
Annual Rates of Stock | |
|
|
Number of | |
|
% of Total | |
|
|
|
Price Appreciation for | |
|
|
Securities | |
|
Options | |
|
|
|
Option Term | |
|
|
Underlying | |
|
Granted to | |
|
Exercise or | |
|
|
|
| |
|
|
Options Granted | |
|
Employees in | |
|
Base Price | |
|
Expiration | |
|
5% | |
|
10% | |
Name |
|
# | |
|
Fiscal Year | |
|
($/Sh) | |
|
Date | |
|
($) | |
|
($) | |
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
Timothy W. Byrne
|
|
|
30,000 |
|
|
|
28.3% |
|
|
|
11.35 |
|
|
|
12/30/14 |
|
|
|
214,200 |
|
|
|
542,700 |
|
Billy R. Hughes
|
|
|
5,000 |
|
|
|
4.7% |
|
|
|
8.56 |
|
|
|
1/29/14 |
|
|
|
26,900 |
|
|
|
68,200 |
|
M. Michael Owens
|
|
|
4,500 |
|
|
|
4.2% |
|
|
|
8.56 |
|
|
|
1/29/14 |
|
|
|
24,210 |
|
|
|
61,380 |
|
Johnney G. Bowers
|
|
|
1,500 |
|
|
|
1.4% |
|
|
|
8.56 |
|
|
|
1/29/14 |
|
|
|
8,020 |
|
|
|
20,460 |
|
Richard Murray
|
|
|
6,000 |
|
|
|
5.7% |
|
|
|
8.56 |
|
|
|
1/29/14 |
|
|
|
32,280 |
|
|
|
81,840 |
|
Aggregated Option Exercises in Last Fiscal Year and
Year-End Option Values
The following table sets forth information with respect to stock
options exercised by the named executive officers during 2004
and the number and value of unexercised options held by such
executive officers at year end:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Securities | |
|
Value of Unexercised | |
|
|
|
|
|
|
Underlying Unexercised | |
|
In-the-Money | |
|
|
Shares | |
|
Value | |
|
Options at Year-End (#) | |
|
Options at Year-End ($) | |
|
|
Acquired on | |
|
Realized | |
|
| |
|
| |
Name |
|
Exercise (#) | |
|
($)(1) | |
|
Exercisable | |
|
Unexercisable | |
|
Exercisable | |
|
Unexercisable | |
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
Timothy W. Byrne
|
|
|
30,000 |
|
|
|
150,000 |
|
|
|
101,190 |
|
|
|
8,180 |
|
|
$ |
563,200 |
|
|
|
0 |
|
Billy R. Hughes
|
|
|
5,000 |
|
|
|
20,250 |
|
|
|
42,000 |
|
|
|
10,000 |
|
|
|
185,200 |
|
|
$ |
13,950 |
|
M. Michael Owens
|
|
|
|
|
|
|
|
|
|
|
4,000 |
|
|
|
12,500 |
|
|
|
30,000 |
|
|
$ |
72,555 |
|
Johnney G. Bowers
|
|
|
|
|
|
|
|
|
|
|
22,000 |
|
|
|
1,500 |
|
|
|
85,700 |
|
|
|
4,185 |
|
Richard D. Murray
|
|
|
|
|
|
|
|
|
|
|
45,000 |
|
|
|
10,000 |
|
|
|
123,550 |
|
|
$ |
46,740 |
|
|
|
(1) |
Market value of underlying securities on the date of exercise
minus the exercise price. |
Equity Compensation Plan Information
The following table sets forth information with respect to the
Companys equity compensation plans as of December 31,
2004:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares | |
|
|
|
|
|
|
to Be Issued | |
|
Weighted Average | |
|
|
|
|
upon Exercise of | |
|
Exercise Price of | |
|
Number of Shares | |
|
|
Outstanding Options, | |
|
Outstanding Options, | |
|
Remaining Available | |
Plan Category |
|
Warrants and Rights | |
|
Warrants and Rights | |
|
for Future Issuance | |
|
|
| |
|
| |
|
| |
Equity compensation plans approved by security holders
|
|
|
379,000 |
|
|
$ |
7.21 |
|
|
|
204,500 |
|
Equity compensation plans not approved by security holders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
379,000 |
|
|
$ |
7.21 |
|
|
|
204,500 |
|
9
Executive Employment and Termination Agreements
The Company has employment agreements with Messrs. Byrne,
Hughes, and Bowers. Such employment agreements are designed to
ensure that the Company will be able to attract, motivate, and
retain highly qualified talent, which is critical to both the
short- and long-term success of the Company.
The employment agreements provide for a base salary to be
reviewed annually. Mr. Byrne and the Company entered into
an amended and restated employment agreement as of May 2,
2003, which provides him with an annual base salary of at least
$250,000. In addition to the base salary, the agreements for
Messrs. Byrne, Hughes, and Bowers provide for a
discretionary bonus to be determined by the Compensation
Committee of the Board of Directors. In addition to the
possibility of a discretionary bonus, Mr. Byrne is eligible
to receive an objective bonus based on the Companys
earnings before interest, taxes, depreciation, and amortization
(EBITDA) compared to certain levels set forth in
Mr. Byrnes employment agreement. Mr. Byrne is
also entitled to an annual $30,000 contribution to fund a life
insurance or retirement arrangement and a country club
membership. In the event of a change of control of the Company,
and Mr. Byrnes termination, Mr. Byrne is
entitled to severance payments equal to his then-current annual
base salary, benefits, and bonuses for at least one and a half
years, depending on the reason for and date of his termination
in relation to the change in control. Mr. Byrne is entitled
to severance payments equal to his then-current annual base
salary, benefits, and bonuses for one and a half years if he is
terminated without cause. In the case of Mr. Bowers, his
severance payment would be six months compensation.
Mr. Hughes does not have a severance arrangement, but is
generally entitled to one-years notice before termination.
Mr. Byrnes and Mr. Hughes agreements
contain certain post-termination covenants not to compete. The
employment agreements also provide for use of a Company car,
reimbursement of business expenses, participation in the
Companys 401(k) profit-sharing plan and other benefit
programs on the same basis as other salaried employees.
Mr. Hughes and Mr. Bowers agreements have
no expiration dates. Mr. Byrnes agreement expires on
December 31, 2008, and is thereafter renewable for
successive one-year periods, unless the agreement is terminated
earlier by him or the Company. Pursuant to Mr. Byrnes
employment agreement, the Company agreed to use its best efforts
to cause Mr. Byrne to remain on the Board and to be
appointed a member of the Executive Committee of the Board.
Compensation of Directors
Directors who are not employees of the Company, other than the
Chairman of the Board of Directors and the Chairman of the Audit
Committee, are paid an annual retainer of $14,000 plus
$800 per day on Company business. The Chairman of the Board
is paid an annual retainer of $45,000 plus $1,000 per day
on Company business, and the Chairman of the Audit Committee is
paid an annual retainer of $26,000 plus $800 per day on
Company business. Telephonic meeting fees are paid at one-half
the normal per day rate.
Non-employee directors of the Company are also granted 2,000
stock options annually under the Companys 2001 Plan.
During 2004, each non-employee director was granted a ten-year
stock option exercisable immediately for 2,000 shares at an
exercise price of $8.39 per share.
10
PERFORMANCE GRAPH
The graph below compares the cumulative five-year total
shareholders return on the Companys Common Stock
with the cumulative total return on The Nasdaq Stock Market
Index and a peer group consisting of Oglebay Norton Company
(through December 31, 2003), Florida Rock Industries,
Lafarge Corporation, and Martin Marietta Materials, Inc. The
graph assumes that the value of the investment in the
Companys Common Stock and each index was $100 on
December 31, 1999, and that all dividends have been
reinvested.
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
AMONG U.S. LIME & MINERALS, INC.,
NASDAQ MARKET INDEX AND PEER GROUP INDEX
ASSUMES $100 INVESTED ON DECEMBER 31, 1999
ASSUMES DIVIDENDS REINVESTED THROUGH
FISCAL YEAR ENDED DECEMBER 31, 2004
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
1999 | |
|
2000 | |
|
2001 | |
|
2002 | |
|
2003 | |
|
2004 | |
| |
U.S. LIME & MINERALS, INC.
|
|
$ |
100.00 |
|
|
|
72.54 |
|
|
|
83.59 |
|
|
|
55.95 |
|
|
|
103.50 |
|
|
|
174.03 |
|
PEER GROUP INDEX
|
|
$ |
100.00 |
|
|
|
98.31 |
|
|
|
132.83 |
|
|
|
110.46 |
|
|
|
153.15 |
|
|
|
205.05 |
|
NASDAQ MARKET INDEX
|
|
$ |
100.00 |
|
|
|
62.85 |
|
|
|
50.10 |
|
|
|
34.95 |
|
|
|
52.55 |
|
|
|
56.97 |
|
11
INDEPENDENT AUDITORS
Fees for professional services provided by our independent
auditors, Ernst & Young LLP, for the last two fiscal
years, in each of the following categories, are:
|
|
|
|
|
|
|
|
|
|
|
2004 | |
|
2003 | |
|
|
| |
|
| |
Audit
|
|
$ |
140,000 |
|
|
$ |
142,444 |
|
Audit-Related
|
|
|
16,000 |
|
|
|
9,000 |
|
Tax
|
|
|
13,275 |
|
|
|
15,225 |
|
|
|
|
|
|
|
|
Total
|
|
$ |
169,275 |
|
|
$ |
166,669 |
|
|
|
|
|
|
|
|
Audit Fees. Fees for audit services include fees
associated with the annual audit and the reviews of the
Companys quarterly reports on Form 10-Q.
Audit-Related Fees. Audit-related fees principally
include fees relating to an employee benefit plan audit and
accounting consultations.
Tax Fees. Tax fees include fees relating to reviews and
preparation of tax returns and tax consultations.
The Audit Committee has adopted a pre-approval policy relating
to the providing of services by the Companys independent
auditors. Under the Committees pre-approval procedures,
all services to be provided by the auditors must be approved in
advance by the Committee. The Committee has delegated to the
Chairman of the Committee the authority to approve such services
up to $25,000 each in the case of either a change in the scope
or cost of previously approved services, or an additional type
of services that was not covered by a prior Committee approval.
The Audit Committee does not delegate any of its approval
authority to management.
Representatives of the firm of Ernst & Young LLP are
expected to be present at the Annual Meeting and will have an
opportunity to make a statement if they so desire and will be
available to respond to appropriate questions.
OTHER MATTERS
The Board does not intend to present any other matters at the
Annual Meeting and knows of no other matters that will be
presented. However, if any other matters properly come before
the Annual Meeting, the persons designated as proxies on the
enclosed Proxy Card intend to vote thereon in accordance with
their best judgment.
SHAREHOLDER PROPOSALS
Shareholder proposals submitted to the Company under SEC
Rule 14a-8 under the Securities Exchange Act of 1934 for
inclusion in the Companys proxy statement for its 2006
Annual Meeting of Shareholders must be received by the Company
at its office in Dallas, Texas, addressed to Timothy W. Byrne,
President and Chief Executive Officer of the Company, not later
than December 5, 2005. Such Rule 14a-8 shareholder
proposals must comply with SEC rules.
The Company must receive notice of other matters, including
non-Rule 14a-8 proposals, that shareholders may wish to
raise at the 2006 Annual Meeting of Shareholders by
February 18, 2006. If the Company does not receive timely
notice of such other matters, the persons designated as proxies
for such meeting will retain general discretionary authority to
vote on such matters under SEC rules. Such notices should be
addressed to Timothy W. Byrne, President and Chief Executive
Officer of the Company.
12
The costs of solicitation of Proxies for the Annual Meeting will
be borne by the Company. Solicitation may be made by mail,
personal interview, telephone, and/or facsimile by officers and
regular employees of the Company who will receive no additional
compensation therefor. The Company may specifically engage a
firm to aid in the solicitation of Proxies, for which services
the Company would anticipate paying a standard reasonable fee
plus out-of-pocket expenses. The Company will bear the
reasonable expenses incurred by banks, brokerage firms, and
other custodians, nominees, and fiduciaries in forwarding proxy
materials to beneficial owners.
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UNITED STATES LIME & MINERALS, INC. |
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Timothy W. Byrne |
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President and Chief Executive Officer |
Dallas, Texas
April 8, 2005
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A Election of Directors
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The Board of Directors recommends a vote FOR the listed
nominees. |
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For All |
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Withhold All |
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For All Except |
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01-T. W. Byrne, 02-R. W. Cardin,
03-A. M. Doumet, 04-W. G. Irmscher, 05-E. A. Odishaw
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(Except nominee(s) written above.) |
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In their discretion, the proxies are authorized to vote upon such other business as may properly be
brought before the Annual Meeting or any adjournment thereof. |
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B Authorized Signatures
Sign Here This section must be completed for your instructions to be executed.
The undersigned acknowledges receipt of the Notice of Annual Meeting of Shareholders and of the Proxy Statement.
Please sign exactly as name appears. Joint owners should each sign personally. Where applicable, indicate your official position or representative capacity.
Signature 1 Please keep signature within
the box
Signature 2 Please keep signature within
the box
Proxy Solicited on Behalf of the Board of Directors
The
undersigned hereby appoints Edward A. Odishaw and Timothy W. Byrne,
and either of them, proxies, with power of substitution in each, and
hereby authorizes them to represent and to vote, as designated below,
all shares of Common Stock of UNITED STATES LIME & MINERALS,
INC. standing in the name of the undersigned on March 31, 2005,
at the Annual Meeting of Shareholders to be held on May 4, 2005,
at the Crowne Plaza Suites, 7800 Alpha Road, Dallas, Texas 75240, and at any adjournment thereof, and especially to vote on the item of business specified below, as more fully described in the Notice of the Meeting dated April 8, 2005, and the Proxy Statement accompanying the same, the receipt of which is hereby acknowledged.
You are encouraged to record your vote on the following items of business to be brought before the Annual Meeting, but you need to not mark any box if you wish to vote in accordance with the Board of Directors recommendation. The proxies cannot vote your shares unless you sign, date, and return this Proxy Card. Remember, you can revoke this Proxy Card and vote in person by attending the Annual Meeting, or by submitting to the Company prior to the Annual Meeting, a written notice of revocation.
YOUR VOTE IS IMPORTANT! PLEASE MARK, SIGN, AND DATE THIS PROXY CARD AND RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE.
(Continued and to be signed on reverse side.)