Maytag Corporation
403 West Fourth Street North
Newton, Iowa 50208
April 3, 1997
BY ELECTRONIC SUBMISSION
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Maytag Corporation
File No. 1-655
Definitive Proxy Materials
Ladies and Gentlemen:
Enclosed for filing by Maytag Corporation (the "Company"), pursuant to Rule
14a-6(b) under the Securities Exchange Act of 1934 (the "Exchange Act"), as
modified by Item 309 of Regulation S-T, are definitive copies of the Company's
proxy statement and proxy card (collectively, the "1997 Proxy Materials").
Pursuant to Rule 14a-6(m) under the Exchange Act, a cover page is included with
the 1997 Proxy Materials. The 1997 Proxy Materials will be released to
shareholders on or about April 3, 1997.
Pursuant to Item 304(d) of Regulation S-T, the performance graph required
by Item 402(1) of Regulation S-K has been described and interpreted in tabular
or chart form within the electronic filing of the 1997 Proxy Materials and the
Company will submit supplementally a paper copy of the performance graph to the
Company's Branch Chief in the Division of Corporation Finance of the Securities
and Exchange Commission ("SEC").
As permitted by Item 101(b) of Regulation S-T, the Company has elected to
file seven copies of Company's 1996 Annual Report with SEC pursuant to Rule 14a-
3(c).
One copy of a conforming paper format copy of the 1997 Proxy Materials will
be submitted to the SEC at the address indicated below in accordance with Item
901 of Regulation S-T. Each such conforming paper format copy will include the
following legend: "This conforming paper document is being submitted pursuant to
Rule 901(d) of Regulation S-T."
If you have any questions, please contact E. James Bennett at 515/791-8394 or
Jim L. Kaput of Sidley & Austin at 312/853-2655.
Very truly yours,
E. James Bennett
Enclosures
cc: Mr. Robert Bartelmes
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
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 Part other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to
240.14a-11(c) or 240.14a-12
Maytag Corporation
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Ex-
change 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.:
_/ Set forth the amount on which the
filing fee is calculated and state how it was
determined.
[ ] 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 previ-
ously. 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 State-
ment No.:
______________________________________
(3) Filing Party:
______________________________________
(4) Date Filed:
______________________________________
MAYTAG CORPORATION
NOTICE OF ANNUAL MEETING
AND
PROXY STATEMENT
____________________
MEETING NOTICE
The Annual Meeting of the Shareholders of Maytag Corporation, a Delaware
Corporation, will be held at the Newton Senior High School Center for
Performance, located at East Fourth Street South in Newton, Iowa, on May 15,
1997, at 9:00 a.m., for the purpose of considering and acting upon the
following:
(1) The election of four directors for three-year terms, expiring in 2000.
(2) Selection of Ernst & Young LLP as independent auditors to audit the
financial statements to be included in the Annual Report to
Shareholders for 1997.
(3) The transaction of any other matters that properly come before the
meeting or any adjournment thereof.
Shareholders entitled to vote are invited to attend the Annual Meeting.
The Board of Directors has fixed the close of business on March 17, 1997,
as the record date for the determination of shareholders entitled to notice of
and to vote at the Annual Meeting.
Dated: April 3, 1997
E. JAMES BENNETT
Secretary
PROXY STATEMENT
____________________
The Board of Directors solicits your proxy for use at the Annual Meeting of
Maytag Corporation to be held May 15, 1997. Proxy statements and proxies will
be mailed to shareholders on April 3, 1997. A shareholder who signs and returns
a proxy may revoke it or give special voting directions at any time before the
proxy is exercised by writing the Secretary of the Corporation at its executive
offices at 403 West Fourth Street North, Newton, Iowa 50208, by executing a
later-dated proxy which is voted at the meeting or by attending the 1997 Annual
Meeting in person and giving written notice to the Secretary of the Corporation
The proxy will be voted in accordance with such directions.
The Corporation had 98,033,013 outstanding shares of common stock as of the
close of business on March 17, 1997, not including 19,117,580 shares of treasury
stock. The Corporation has no other voting securities outstanding. Shareholders
are entitled to one vote per share on each matter. If the accompanying form of
proxy is signed and returned, the shares it represents will be voted as directed
on the proxy form. In the absence of direction, it is intended that such shares
will be voted for each of the nominees named herein, and for the selection of
Ernst & Young LLP as independent auditors.
A shareholder may, with respect to the election of directors (i) vote for
the election of all four nominees named herein as directors, (ii) withhold
authority to vote for all such director nominees or (iii) vote for the election
of all such director nominees other than any nominee with respect to whom the
shareholder withholds authority to vote by so indicating in the appropriate
space on the proxy. Withholding authority to vote for a director nominee will
not prevent such director nominee from being elected. A shareholder may, with
respect to each other matter specified in the notice of the meeting (i) vote
"FOR" the matter, (ii) vote "AGAINST" the matter or (iii) "ABSTAIN" from voting
on the matter. A vote to abstain from voting on a matter has the legal effect
of a vote against such matter.
A proxy submitted by a shareholder may indicate that all or a portion of
the shares represented by such proxy are not being voted by such shareholder
with respect to a particular matter. This could occur, for example, when a
broker is not permitted to vote stock held in street name on certain matters in
the absence of instructions from the beneficial owner of the stock. The shares
subject to any such proxy which are not being voted with respect to a particular
matter (the "non-voted shares") will be considered shares not present and
entitled to vote on such matter, although such shares may be considered present
and entitled to vote for other purposes and will count for purposes of
determining the presence of a quorum. (Shares voted to abstain as to a
particular matter will not be considered non-voted shares.) Approval of each
matter specified in the notice of the meeting requires the affirmative vote of a
majority, or in the case of the election of directors a plurality, of the shares
of common stock present in person or by proxy at the Annual Meeting and entitled
to vote on such matter. Accordingly, non-voted shares with respect to such
matters will not affect the determination of whether such matters are approved
or the outcome of the election of directors.
(1) DIRECTORS AND NOMINEES FOR ELECTION AS DIRECTORS
Under the authority of the Corporation's Bylaws, the Board is to consist of
twelve directors divided into three groups. The term of each group expires in
2
different years. The four nominees for election to the Board of Directors this
year to hold office until the 2000 Annual Meeting of Shareholders and until
their successors have been duly elected and qualified are: Lester Crown, Bernard
G. Rethore, Neele E. Stearns, Jr. and Carole J. Uhrich.
Proxies will be voted for each of the nominees unless, for reasons not now
known, any nominee is unable to serve or other directions are given in the
proxy. Should any of the nominees not be able to accept the office of director
when the election occurs, it is intended that such proxies will be voted for the
election of the remaining nominees and for any substitute nominees recommended
by the Board of Directors or the Board of Directors may elect not to fill the
vacancy and to reduce the number of directors.
The affirmative vote of the holders of a plurality of the shares of common
stock present in person or represented by proxy at the Annual Meeting and
entitled to vote on the election of directors is required to elect the nominees.
Mr. Edward C. Cazier, Jr. will retire from the Maytag Corporation Board of
Directors at the conclusion of the 1997 Annual Meeting, and Mr. Peter S.
Willmott resigned from the Board on November 15, 1996. Each of these gentlemen
served with great distinction for more than ten years. The guidance and counsel
of these outstanding directors will be missed.
The following sets forth certain information regarding each nominee and
each director whose term continues after the 1997 Annual Meeting based on
information received from each such nominee and continuing director.
NOMINEES FOR A TERM TO EXPIRE IN 2000 (pictures of each of the four nominees
listed below included in margin to the left)
Lester Crown, 71, Chairman of the Board, Material Service Corporation.
Director since 1989.
Mr. Crown was elected Chairman of the Board of Material Service
Corporation, a manufacturing company, in 1983, having served as its
President since 1970. He is a director and Chairman of the Executive
Committee of General Dynamics Corporation, a director of 360 Degree
Communications Company and President of Henry Crown and Company.
Bernard G. Rethore, 55, Chairman of the Board, President and Chief
Executive Officer of BW/IP, Inc., a manufacturer of fluid transfer and
control equipment and systems. Director since 1994.
Mr. Rethore became President and Chief Executive Officer of BW/IP,
Inc., in October, 1995 and was elected Chairman of the Board in February,
1997. He served as Senior Vice President of Phelps Dodge Corporation, and
President, Phelps Dodge Industries, its diversified international
industrial group, from 1989 until 1995. From 1984 to 1989, he was
President, then Chief Executive Officer of Microdot Industries, the
diversified manufacturing division of Microdot Inc. Mr. Rethore is also a
director of BW/IP, Inc. and Belden Inc.
Neele E. Stearns, Jr., 61, former President and Chief Executive
Officer, CC Industries, Inc., a diversified holding company. Director
since 1989.
Mr. Stearns served as Executive Vice President and Chief Operating
Officer of Henry Crown and Company, from 1979 until 1986. From 1986 until
his retirement in 1994 he served as President and Chief Executive Officer
of CC Industries, Inc. Mr. Stearns is also a director of Wallace Computer
Services, Inc.
3
Carole J. Uhrich, 53, Executive Vice President and President,
Commercial Imaging, Polaroid Corporation, a photographic imaging and
equipment company. Director since 1995.
Ms. Uhrich joined Polaroid in 1966, holding various positions in the
engineering division until becoming a plant manager in 1983. She was named
Director of Manufacturing in 1984, Vice President of Corporate Quality in
1987, Vice President of Product Delivery in 1988, Vice President of
Quality, New Product Delivery in 1990, Group Vice President, Manufacturing
and Product Development in 1992 and Executive Vice President, Global Supply
Chain in 1996 before assuming her current position in 1997. She also
serves as a director of Ceridian Corporation.
DIRECTORS WHOSE TERMS CONTINUE AFTER THE ANNUAL MEETING
Barbara R. Allen, 44, Executive Vice President, International Food
Products, The Quaker Oats Company, a food products company. Director since
1995. Term expires in 1999.
Ms. Allen joined Quaker Oats in 1975, holding various marketing positions
until becoming a Vice President in 1987, Corporate Vice President and President
of the Frozen Foods Division in 1990 and Vice President, Corporate Planning in
1992. She assumed her current position in 1995.
Howard L. Clark, Jr., 53, Vice Chairman, Lehman Brothers Inc., an
investment banking and brokerage firm. Director since 1986. Term expires in
1999.
Mr. Clark became Vice Chairman of Lehman Brothers Inc. in 1993. He was
Chairman, President and Chief Executive Officer of Shearson Lehman Brothers
Holdings, Inc. from 1990 until he assumed his current position. Prior thereto,
Mr. Clark was Executive Vice President and Chief Financial Officer of American
Express Company having held various positions with that firm since 1981. From
1968 to that time he was Managing Director of Blyth Eastman Paine Webber
Incorporated or predecessor firms. He is also a director of Lehman Brothers
Inc., Fund American Enterprises Holdings Inc., Walter Industries, Inc. and
Plasti-Line Inc. Lehman Brothers Inc. provides certain investment banking
services to the Corporation.
Leonard A. Hadley, 62, Chairman and Chief Executive Officer, Maytag
Corporation. Director since 1985. Term expires in 1999.
Mr. Hadley joined the Corporation in 1959 in the Accounting Department. He
held a number of management positions before he was named Vice President in
1979. He was named President of Maytag Company in 1986, elected an Executive
Vice President of the Corporation in 1989, named Chief Operating Officer in 1990
and President in 1991. He was named Chief Executive Officer in 1992 and elected
Chairman in 1993. He also serves as a director of Deere & Company, Norwest
Bank Iowa and Snap-on Incorporated.
Wayland R. Hicks, 54, former President and Chief Executive Officer, Indigo,
Inc. N.V., a producer of digital offset color printing products. Director since
1994. Term expires in 1998.
Mr. Hicks became President and Chief Executive Officer of Indigo, Inc. N.V.
in February, 1996 retiring from that position in February, 1997. He served as
Chief Executive and Vice Chairman of Nextel Communications, Inc. from 1994 until
1995. Prior to joining Nextel, Mr. Hicks served in various management positions
with Xerox Corporation, becoming a Vice President in 1983 and an Executive Vice
President in 1987. Mr. Hicks is also a director of Katun Corporation,
Techtronix and Perdue Farms.
4
Robert D. Ray, 68, former President and Chief Executive Officer of IASD
Health Services Corporation. Director since 1984. Term expires in 1999.
Mr. Ray served as Governor of Iowa from 1969 to 1983 when he became
President and Chief Executive Officer of Life Investors, Inc. a/k/a AEGON. In
1988 he became President and Chief Executive Officer of IASD Health Services
Corporation a/k/a Blue Cross and Blue Shield of Iowa, retiring from that
position in 1996. Prior to 1969 he practiced law in Des Moines. He is also a
director of IES Industries, Inc.
W. Ann Reynolds, 59, Chancellor of The City University of New York.
Director since 1988. Term expires in 1998.
Ms. Reynolds has served as Chancellor of The City University of New York
since 1990. From 1982 to 1990 she served as Chancellor of The California State
University. From 1979 to 1982 she served as Provost and as a professor at Ohio
State University. Prior to that time she held a variety of administrative,
research and teaching positions at the University of Illinois Medical Center.
She is also a director of Abbott Laboratories, Humana, Inc. and Owens-Corning
Fiberglas Corporation.
John A. Sivright, 68, Senior Consultant, Harris Bankcorp, Inc. Director
since 1976. Term expires in 1998.
Mr. Sivright held a number of positions with Harris Bankcorp, Inc. and was
named a Vice President in 1965, an Executive Vice President in 1980, Senior
Relationship Executive in 1991 and to his current position in 1994. He is also
a director of Harris Bank Winnetka, N.A.
Fred G. Steingraber, 58, Chairman and Chief Executive Officer of A. T.
Kearney, Inc., a management consulting firm. Director since 1989. Term expires
in 1998.
Mr. Steingraber held various positions with A. T. Kearney beginning in 1964
and became Chief Executive Officer in 1984. He was elected to his current
position in 1986. Mr. Steingraber is also a director of A. T. Kearney, Inc.,
Southeastern Thrift Bank Fund, Inc., Lawter International and Mercury Finance
Corporation.
5
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS, DIRECTORS AND MANAGEMENT
The following table shows those persons or groups known to Maytag to be the
beneficial owners of more than five percent (5%) of Maytag common stock as of
March 1, 1997.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
_____________________________________________________________________________
Amount and Nature
Name and Address of Beneficial Ownership Percent of Class
FMR Corp. (1) 11,290,848 11.52%
82 Devonshire St.
Boston, Massachusetts 02109-3614
Crown Group c/o (2) 5,350,169 5.46%
Gerald A. Weber
222 North LaSalle Street
Chicago, Illinois 60601
_____________________________________________________________________________
(1) A form 13G has been filed with the Securities and Exchange Commission by
FMR Corp. as of December 31, 1996 showing it beneficially owns 11,290,848 shares
of the Corporation. This number included: 10,653,529 shares beneficially owned
by Fidelity Management and Research Company, as a result of its serving as
investment adviser to various registered investment companies and as investment
advisor to certain other funds; 7,672,100 shares beneficially owned by Fidelity
Magellan Fund, one of the registered investment companies mentioned above;
637,319 shares beneficially owned by Fidelity Management Trust Company, as a
result of its serving as an investment manager of institutional accounts;
11,290,848 shares beneficially owned by Edward C. Johnson, 3d and Abigail P.
Johnson and members of the Edward C. Johnson 3d family as members of a group
which may be deemed a control group with respect to FMR Corp. Edward C. Johnson
3d and FMR Corp. through its control of Fidelity Management Trust Company, each
have the sole voting power with respect to 359,719 shares and the sole
dispositive power with respect to 637,319 shares. Edward C. Johnson 3d, FMR
Corp. through its control of Fidelity, and the funds each have sole disposition
power with respect to 10,653,529 shares.
(2) Although no person or entity in the group owned beneficially more than 5%
of the common stock outstanding, a number of persons acting together, including
Lester Crown, members of his family, relatives, certain family partnerships,
trusts associated with the Crown family, and other entities, are the beneficial
owners of an aggregate of 5,350,169 shares of Maytag common stock, constituting
5.46% of the common stock. A Schedule 13D relating to the ownership of shares
of common stock by these persons and entities has been filed with the Securities
and Exchange Commission by Gerald A. Weber, as attorney and agent. These
persons and entities, including Lester Crown, disclaim that they are a group for
purposes of Section 13(d) of the Securities Exchange Act of 1934 or otherwise,
and disclaim that any one of them is the beneficial owner of shares owned by any
other person or entity filing the Schedule 13D.
6
The following table shows for each director and nominee, for each executive
officer named in the Summary Compensation Table on Page 9 and for all directors
and executive officers as a group, the number of shares of Maytag common stock
beneficially owned as of March 1, 1997.
SECURITY OWNERSHIP OF DIRECTORS AND MANAGEMENT
____________________________________________________________________________
Amount and Nature of
Name Beneficial Ownership Percent of Class
____________________________________________________________________________
Barbara R. Allen 2,100 (b) *
Howard L. Clark, Jr. 15,836 (b) *
Lester Crown 4,550,565 (a) (b) (d) 4.64%
Brian A. Girdlestone 94,064 (b) (c) *
Edward H. Graham 70,979 (b) (c) *
Leonard A. Hadley 400,375 (a) (b) (c) *
Wayland R. Hicks 12,500 (b) *
Gerald J. Pribanic 44,828(a)(b)(c) *
Robert D. Ray 18,100 (a)(b) *
Bernard G. Rethore 6,000 (b) *
W. Ann Reynolds 12,300 (b) *
John A. Sivright 17,712 (a)(b) *
Neele E. Stearns, Jr. 16,090 (b) *
Fred G. Steingraber 17,000 (b) *
Carole J. Uhrich 2,000 (b) *
Lloyd D. Ward 125,793 (b)(c) *
All directors and executive officers
as a group consisting of 21 persons,
including the above named. 5,601,996 (a)(b)(c)(d) 5.74%
- - ---------------------------------------------------------------------------
* Less than one percent.
(a) Includes shares owned by associates or certain family members in which
the director disclaims any beneficial interest.
(b) Included in the totals are shares which the following directors,
executive officers named in the Summary Compensation Table on Page 9 and all
directors and executive officers as a group have the right to acquire under
unexercised stock options: Brian A. Girdlestone 64,360 shares; Edward H. Graham
41,420 shares; Leonard A. Hadley 224,190 shares; Gerald J. Pribanic 19,690
shares; Lloyd D. Ward 88,300 shares; Ms. Reynolds and Messrs. Clark, Crown, Ray,
Sivright, Stearns and Steingraber each have options to acquire 10,000 shares,
Mr. Hicks has options to acquire 4,000 shares, Ms. Allen, Mr. Rethore and Ms.
Uhrich each have options to acquire 2,000 shares, and all directors and
executive officers as a group have options to acquire 637,980 shares.
(c) Included in the individual totals are shares granted under stock
awards in 1995, 1996 and 1997, pursuant to the Corporation's Stock Incentive
Award Plan For Key Executives and 1996 Employee Stock Incentive Plan as to
which the following executive officers or directors and all executive officers
as a group have sole voting power: Brian A. Girdlestone 13,666; Edward H.
Graham 9,645; Leonard A. Hadley 45,057; Gerald J. Pribanic 7,290; Lloyd D. Ward
18,728; and all executive officers and directors as a group 126,164. Such
shares are subject to forfeiture under the terms of the awards.
7
(d) The number of shares shown as beneficially owned by Mr. Crown includes
shares held by the following concerns of which he is a partner: Arelijay
Company 1,270,382 and The Crown Fund 1,618,769; Henry Crown and Company (Not
Incorporated), of which a trust of which he is a trustee is a partner owns
48,775. In addition, 732,180 shares are owned by various trusts of which he is
a trustee; 55,491 shares are owned by various trusts of which he is a grantor
and a beneficiary; and 65,657 shares are owned by the Arie and Ida Crown
Memorial of which he is a director. The number of shares shown does not include
shares owned by various trusts of which Mr. Crown's children are beneficiaries.
Mr. Crown disclaims beneficial ownership of the shares listed in this footnote,
except to the extent of his beneficial ownership therein.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
During 1996 Mr. Robert Downing, an executive officer and Messrs. Crown,
Downing, Hicks & Ray each inadvertently failed to timely file with the
Securities and Exchange Commission one Form 4 related to one transaction.
COMMITTEES AND ATTENDANCE
The Board of Directors has an Audit Committee, a Compensation Committee and
a Nominating Committee as well as other committees.
The Audit Committee, which met four times in 1996, consists of Barbara R.
Allen, Edward C. Cazier, Jr., Howard L. Clark, Jr., Wayland R. Hicks and Neele
E. Stearns, Jr. Its charge includes the review of the Corporation's financial
statements with the Corporation's independent auditors and review of the
relationship between the Corporation and its external and internal auditors.
The Compensation Committee's duties are to review and approve compensation
plans and policies of the Corporation, recommend to the Board the salaries of
all officers of the Corporation, declare bonus and incentive plan allocations
for management employees of the Corporation, award stock options and provide
stock grants to key executives. The Committee consists of Wayland R. Hicks,
Bernard G. Rethore, W. Ann Reynolds, John A. Sivright and Neele E. Stearns, Jr.
The Committee met four times in 1996.
The Nominating Committee, which met two times in 1996, nominates persons to
serve on the Board of Directors and recommends compensation levels and other
remunerative programs for directors. It consists of Lester Crown, Robert D.
Ray, W. Ann Reynolds, John A. Sivright and Fred G. Steingraber.
During 1996 the Board of Directors held five meetings either in person or
by telephone.
During 1996 each director attended at least 75% of Board meetings and
meetings of the committees of which such director is a member, except Messrs.
Crown and Hicks.
(2) RELATIONSHIP WITH INDEPENDENT AUDITORS
A further purpose of the meeting is to select independent auditors to audit
the financial statements to be included in the Annual Report to Shareholders for
1997. The persons named in the enclosed form of proxy have advised the Board of
Directors that it is their intention, unless otherwise instructed by the
shareholders, to vote for the selection of Ernst & Young LLP as such independent
auditors. Ernst & Young LLP has audited the financial statements of the
Corporation since 1925 and is expected to have a representative present at the
8
meeting to make a statement if such representative desires to do so and to be
available to respond to appropriate questions.
9
EXECUTIVE COMPENSATION
The following table shows the compensation of the Chief Executive Officer of the
Corporation and the other four most highly compensated executive officers of the
Corporation serving as such on December 31, 1996 (the "named executive
officers").
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
Awards Payouts
Year Salary Bonus Other Restricted Securities LTIP All Other
Name and Principal Annual Stock Underlying Payouts Compensation
Position Compensa- Award(s) Options/SAR's <F2>
tion <F1> (#)
Leonard A. Hadley 1996 $648,000 $600,000 0 0 146,260 $ 619,352 $ 9,955
Director, Chairman & CEO 1995 600,000 400,000 0 174,190 1,039,788 7,444
1994 563,800 505,000 0 25,000 0 7,234
Lloyd D. Ward <F3> 1996 $318,750 $219,256 0 0 290,240 $ 81,112 $ 4,361
Executive VP & President (9
Maytag Appliances mos)
Brian A. Girdlestone 1996 $287,000 $196,308 0 0 32,390 $ 202,698 $10,964
President, Hoover
Edward H. Graham 1996 $208,000 $ 99,216 0 0 25,000 $ 139,106 $ 8,356
Sr. VP, General Counsel and 1995 192,565 82,632 0 0 27,290 216,923 7,167
Ass't. Secretary 1994 179,200 102,144 0 0 2,810 0 6,889
Gerald J. Pribanic 1996 $185,233 $92,417 0 0 35,000 $ 70,829 $ 5,943
Executive VP & CFO
<FN>
<F1> At December 31, 1996, the number of shares of restricted stock, the number of restricted units and the respective
values thereof held by the named executive officers were as follows: Leonard A. Hadley, 30,896 shares valued at $623,713
and 20,597 units valued at $415,802; Lloyd D. Ward, 11,466 shares valued at $231,470 and 7,643 units valued at $154,293;
Brian A. Girdlestone, 9,593 shares valued at $193,659 and 6,396 units valued at $129,119; Edward H. Graham, 6,745 shares
valued at $136,165 and 4,498 units valued at $90,803; and Gerald J. Pribanic, 4,458 shares valued at $89,996 and 2,973
units valued at $60,017. Dividends are paid on restricted stock at the same time and at the same rate as on the common
stock. Dividend equivalents on restricted units are accrued and accumulate at the same rate and at the same time as
dividends on the common stock. Dividend equivalents on restricted units are treated as reinvested dividends applicable to
the restricted units which units are paid out if and when the performance goals (described in the Long-Term Incentive Plan
Awards Table below) are satisfied.
<F2> The amounts reported in this column for 1996 include the dollar value of premiums paid for life insurance for the
benefit of the named executive officer and the dollar value of corporate contributions to the account of the named
executive officer pursuant to the terms of the Salary Savings 401(k) Plan. The contributions for each named executive are
as follows: Leonard A. Hadley, life insurance $5,205, 401(k) $4,750; Lloyd D. Ward, life insurance $1,559, 401(k) $2,802;
Brian A. Girdlestone, life insurance $6,214, 401(k) $4,750; Edward H. Graham, life insurance $3,606, 401(k) $4,750; and
Gerald J. Pribanic, life insurance $1,796, 401(k) $4,147.
<F3> Lloyd D. Ward joined the Corporation as Executive Vice President and President, Maytag Appliances on April 1, 1996.
</FN>
10
The following table sets forth for the named executive officers, certain
information regarding stock options granted in 1996.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED ANNUAL
RATES OF STOCK PRICE
APPRECIATION FOR OPTION
TERM <F4>
(a) (b) (c) (d) (e) (f) (g)
Number of % of Total
Securities Options
Underlying Granted to Exercise or
Options/SAR's Employees Base Price
Granted (#) in Fiscal ($/Share) Expiration 5% 10%
Name <F1> Year<F2> <F3> Date
Leonard A. Hadley 146,260 7.7% 19.00 11/14/2006 $1,747,953 $4,429,045
Lloyd D. Ward 68,300 21.00 03/31/2006 $ 902,106 $2,285,933
150,000 15.3% 21.9375 04/30/2006 2,069,475 5,244,225
71,940 19.00 11/14/2006 859,755 2,178,487
Brian A. Girdlestone 32,390 1.7% 19.00 11/14/2006 $ 387,093 $ 980,834
Edward H. Graham 25,000 1.3% 19.00 11/14/2006 $ 298,775 $ 757,050
Gerald J. Pribanic 35,000 1.8% 19.00 11/14/2006 $ 418,285 $1,059,870
<FN>
<F1> In connection with his commencement of employment with the Corporation on April 1, 1996, Mr. Ward
was granted an option to purchase 68,300 shares at a purchase price of $21.00 per share and on
May 1, 1996 he was granted an option to purchase 150,000 shares at a purchase price of $21.9375.
These options become exercisable on April 1, 1997 and July 31, 1999 respectively. All other
options reported in the table become exercisable beginning on November 15, 1999, except that such
options will become fully exercisable in the event of a Change of Control [generally defined as
occurring when a person individually or together with its affiliates or associates (other than an
employee benefit plan of the Corporation) shall have become the beneficial owner of 20% or more of
the shares of the Corporation entitled to vote for Directors or when Directors who are not a person
or part of a group which is or becomes the beneficial owner of 20% or more of the shares of the
Corporation fail to constitute a majority of the Board of Directors] and in the event of a
termination which qualifies as a Retirement (as defined in the Corporation's Retirement Plan for
Salaried Employees or any other similar retirement plan of the Corporation or of a Subsidiary).
<F2> Total options granted to employees in 1996 were 1,901,870.
<F3> Fair Market Value of underlying shares on the date of grant.
<F4> The dollar amounts under these columns are the result of hypothetical potential gains from
calculations assuming annual growth rates of 5% and 10% in the value of the Corporation's future
stock price over the 10 year term of the options which would result in the per share price of the
Corporation's stock increasing from $21.00 to $34.208 and $54.469, respectively, for the options
expiring on March 31, 2006; from $21.9375 to $35.734 and $56.899, respectively, for the options
expiring on April 30, 2006; and from $19.00 to $30.951 and $49.282, respectively, for the options
expiring on November 14, 2006. These assumed rates of growth are required by the Securities and
Exchange Commission for illustration purposes only and are not intended to forecast possible
future stock prices.
</FN>
11
The following table sets forth for the named executive officers certain
information concerning options exercised during 1996 and unexercised options to
purchase common stock held by such officers at December 31, 1996.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND
YEAR END OPTION/SAR VALUES
Number Of Number of Securities Value of Unexercised
Securities Underlying Unexercised In-the-Money Options
Underlying Options/SAR's December 31, 1996
Options/SAR's Value December 31, 1996 <F1>
Name Exercised (#) Realized Exercisable Unexercisable Exercisable Unexercisable
Leonard A. Hadley 0 0 224,190 146,260 $665,113 $173,684
Lloyd D. Ward 0 0 0 290,240 $0 $85,429
Brian A. Girdlestone 0 0 64,360 32,390 $219,183 $38,463
Edward H. Graham 0 0 41,420 25,000 $132,518 $29,688
Gerald J. Pribanic 0 0 19,690 35,000 $68,065 $41,563
<FN>
<F1> The value is calculated based on the aggregate amount of the excess of $20.1875 (the average of
the high and low price of common stock as reported in the New York Stock Exchange Composite Transactions
Report for December 31, 1996) over the relevant exercise price(s).
</FN>
The following table sets forth for the named executive officers, certain
information regarding long term incentive plan grants made in 1996.
12
LONG-TERM INCENTIVE PLANS - AWARDS IN LAST FISCAL YEAR
Estimated Future Payouts Under Non-
Stock Price-Based Plans <F2><F3>
(a) (b) (c) (d) (e) (f)
Number of Shares, Units Performance or Other
Name or Other Rights Period Until Threshold Target Maximum
(#) Maturation or Payout (#) (#) (#)
Leonard A. Hadley 21,352<F1> 3 Years 5,338 21,352 25,622
Lloyd D. Ward 10,308<F3> 3 Years <F3> 2,577 10,308 12,370
8,801<F3> 3 Years <F3> 2,200 8,801 10,561
3,362<F3> 3 Years <F3> 841 3,362 4,034
Brian A. Girdlestone 6,305<F1> 3 Years 1,576 6,305 7,566
Edward H. Graham 4,569<F1> 3 Years 1,142 4,569 5,483
Gerald J. Pribanic 3,954<F1> 3 Years 989 3,954 4,745
<FN>
<F1> Award made pursuant to the Corporation's 1991 Stock Incentive Award Plan which is a performance-based
restricted stock plan. Target awards are comprised of 60% restricted stock and 40% restricted units.
Dividends are paid on restricted stock at the same rate and at the same time as on the common stock and
dividend equivalents on restricted units are accrued and accumulate at the same rate and at the same time as
dividends on the common stock. Dividend equivalents are treated as reinvested dividends applicable to the
restricted units, which units are paid out if and when the performance goals are satisfied. Target awards are
based upon a percentage of base salary and vary depending upon the individual's position and responsibilities.
<F2> Estimated future payouts are predicated upon the achievement of corporate return on sales and return on
assets objectives over the period from January 1, 1996 to December 31, 1998. The achievement of approximately
25% of the objectives will result in payment of the threshold amount, achievement of 75% of the objectives will
result in payment of an intermediate amount, achieving 100% of the objectives will result in payment of the
target amount, and achieving or exceeding approximately 120% of the objectives will result in payment of the
maximum amount.
<F3> At the time of Mr. Ward's employment on April 1, 1996 he received prorated grants under the Corporation's
1991 Stock Incentive Award Plan of performance-based restricted stock and restricted units similar to grants
previously made to other executives, including the other named executive officers, on January 1, 1996, January
1, 1995 and January 1, 1994. The number of shares and units granted to Mr. Ward were based on a percentage of
his salary and then prorated based on the number of months after April 1 remaining in the grant performance
period divided by 36 (the number of months provided in the plan grants). The performance period is January 1,
1996 to December 31, 1998 for the 1996 grant, January 1, 1995 to December 31, 1997 for the 1995 grant and was
January 1, 1994 to December 31, 1996 for the 1994 grant. The aggregate number of shares and units granted to
Mr. Ward was as follows: 1996 grant, 10,308; 1995 grant, 8,801; 1994 grant, 3,362. Payout on the 1994 grant
is shown in the LTIP Payouts column in the Summary Compensation Table on Page 9. All of the provisions set
forth in footnote A to this Table are applicable to these grants, except target awards for the January 1, 1994
grant were comprised of 70% restricted stock and 30% restricted units. All of the provisions set forth in
footnote B to this Table are applicable to these grants, except for the performance periods of the respective
grants which are set forth above.
</FN>
13
RETIREMENT INCOME TABLE
The following table sets forth the estimated annual pension benefits payable
effective December 31, 1996, assuming retirement at age 65 after selected
periods of continuous service, under the Corporation's retirement plan which
applies to virtually all exempt salaried employees. The Corporation's
retirement plan for salaried employees provides for fixed retirement benefits
based on years of service and compensation received. All compensation shown in
the Salary and Bonus columns of the Summary Compensation Table is included as
compensation under the pension plan.
Average Annual
Earnings for
Highest 5 Estimated Annual Retirement Benefits
Consecutive Years of Credited Service at Retirement
Years of Final
10 Years of
Service
10 15 20 25 30 35*
$100,000 13,983 20,975 27,967 34,958 41,950 48,942
200,000 29,483 44,225 58,967 73,708 88,450 103,192
300,000 44,983 67,475 89,967 112,458 134,950 157,442
400,000 60,483 90,725 120,967 151,208 181,450 211,692
500,000 75,983 113,975 151,967 189,958 227,950 265,942
600,000 91,483 137,225 182,967 228,708 274,450 320,192
700,000 106,983 160,475 213,967 267,458 320,950 374,442
800,000 122,483 183,725 244,967 306,208 367,450 428,692
900,000 137,983 206,975 275,967 344,958 413,950 482,942
1,000,000 153,483 230,225 306,967 383,708 460,450 537,192
1,100,000 168,983 253,475 337,967 422,458 506,950 591,442
1,200,000 184,483 276,725 368,967 461,208 553,450 645,692
1,300,000 199,983 299,975 399,967 499,958 599,950 699,942
1,400,000 215,483 323,225 430,967 538,708 646,450 754,192
1,500,000 230,983 346,475 461,967 577,458 692,950 808,442
The above amounts have been computed on the basis of a straight-life annuity
and are not subject to any deduction for social security or other offset
amounts.
Benefits under the plan are limited to the extent required by provisions of
the Internal Revenue Code and the Employee Retirement Income Security Act of
1974. If payment of actual retirement benefits is limited by such provisions,
an amount equal to any reduction in retirement benefits will be paid as a
supplemental benefit under the Supplemental Employee Retirement Plan under which
such amounts are payable to all qualifying employees including the officers of
the Corporation.
14
*Maximum number of years of service for which the pension benefit accrues.
However, employees who were participants in the Maytag Company Salaried
Employees' Retirement Plan on December 31, 1990, and who retire or terminate
employment on or before January 1, 2005 have been grandfathered and are eligible
for additional credited service. For these employees, the maximum amount of
credited service that may be taken into account in calculating a portion of the
benefit under the current plan is forty (40) years until January 1, 2001, at
which time such maximum will decrease by one (1) year until it is reduced to
thirty-five (35) years by the year 2005, provided, however, that the declining
maximum will not be applied to reduce any participant's years of credited
service below the number of years of credited service earned by such participant
as of the date on which the maximum first applies.
Mr. Hadley and Mr. Graham were in the Maytag Company Salaried Employees'
Retirement Plan on December 31, 1990. To calculate the effect of the above
grandfathering provision, add to the benefit shown for an employee with 35 years
of service an amount equal to one per cent (1%) multiplied by the number of
years of service in excess of 35 multiplied by the average annual earnings shown
in the first column of the table above.
The years of credited service for the named executive officers as of December
31, 1996 are: Leonard A. Hadley 37.5; Lloyd D. Ward 1.0; Brian A. Girdlestone
14.5; Edward H. Graham 16.1; and Gerald J. Pribanic 6.7.
In 1986, The Hoover Company, subsequently acquired by the Corporation, entered
into an agreement with Brian Girdlestone, the purpose of which was to compensate
him Mr. Girdlestone for a loss of pension benefits that resulted when he left
the employment of an Australian subsidiary of Hoover. The agreement provides
Mr. Girdlestone, upon his normal retirement date, a benefit based on a ten year
certain and continuous basis equal to forty seven percent (47%) of his highest
annual average earnings minus amounts payable from the Maytag Corporation
Employees Retirement Plan multiplied by the actuarial reduction factor by which
straight life benefits are converted to ten year certain and continuous
benefits. If Mr. Girdlestone were to leave prior to his normal retirement date,
the benefits would be reduced by .25% for each month that he would have been
employed had he continued with the company. The estimated annual benefits
payable to Mr. Girdlestone upon retirement at age 65 assuming his 1996 earnings
continue through age 65 would be $155,000.
EMPLOYMENT CONTRACTS AND
TERMINATION OF EMPLOYMENT CHANGE OF CONTROL ARRANGEMENTS
The Corporation has entered into agreements with each of the named executive
officers which would become operable only in the event of a change of control of
the Company. Agreements provide that if the officer's employment terminates for
any reason within three years after a change of control, the officer will be
entitled to payments equal to three times total compensation (salary and maximum
bonus) at the rate in effect immediately prior to the change of control, maximum
payout on any outstanding restricted stock awards, and to continued
participation in certain of the Corporation's benefit programs for the same
three year period.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
COMPENSATION PHILOSOPHY AND PRINCIPLES
The Compensation Committee of the Board of Directors (the "Committee"),
composed of five non-employee directors, establishes and administers the
executive compensation program for the Corporation's top executives. The
15
Committee has reaffirmed the Corporation's compensation philosophy as it
pertains to its executives as follows:
1. The Corporation is committed to increasing long term shareholder value
and to ensuring that the objectives of the Corporation's executives are
aligned with that goal. Based on this commitment, it is the
Corporation's philosophy that the total compensation of its executives
closely mirror the performance of the Corporation - reflecting
increases and decreases in those factors contributing to shareholder
value, e.g., profitability, earnings per share and stock price.
2. Providing an opportunity for above average total compensation is
important in order to attract and retain the best and brightest
employees. Providing performance goals are met, the Corporation's total
compensation program will be targeted at a level above the average for
similarly sized industrial firms nationwide.
3. It is the Corporation's goal to provide and consistently administer a
uniform program of total compensation for key employees throughout the
Corporation. This program will facilitate the movement of key employees
between business units and divisions, which supports the business
objective of strengthening organizational development efforts and
providing developmental opportunities for talented individuals.
The Committee believes compensation based on this philosophy supports and
encourages the commitment to achieving business and financial objectives that
will generate long term shareholder value. It is also designed to attract and
retain outstanding executives, to encourage them to make long term commitments
to the Corporation, and to accomplish the Corporation's leadership succession
objectives.
COMPONENTS OF EXECUTIVE COMPENSATION
The Committee views compensation as a total program comprised of annual base
salary and variable short and long term incentives. The total package is
designed to provide a significant percentage of executive compensation through
at risk programs which link long term executive rewards to long term shareholder
rewards. This linkage is achieved through the following compensation
components:
ANNUAL BASE SALARY
A salary range for each position is established using average base pay for
executives employed at industrial organizations selected by independent
compensation consultants. The performance of the organizations in the
industrial database is not known and therefore not considered when establishing
salary ranges. The companies included in the industrial database comprise many
of the companies included in the S&P Household Furnishings and Appliance Stock
Index used in the Performance Graph on Page 18, as well as other companies. The
Committee relies on a broad array of companies in various industries for
comparative analysis of executive compensation because the Committee believes
that the Corporation's competitors for executive talent are more varied than the
Peer Group chosen for comparing stockholder return in the Performance Graph.
Executive pay within the salary range is determined based upon individual
qualifications, experience and performance of specific individual
responsibilities.
16
ANNUAL INCENTIVE
Annual variable incentive compensation is paid to executives in cash based
upon a percentage of base salary and varies depending upon the individual's
position, responsibility and performance. Executives are eligible for annual
cash incentive awards based upon three equally weighted performance factors:
(1) organizational operating income as defined compared to prior year,
(2) Corporate or entity operating income less the cost of working capital
compared to annual plan, and (3) organizational performance against key
strategic objectives. An award may be increased or decreased based upon the
executive's personal performance. Performance is reviewed and rated annually
against these factors. The Committee may adjust these formula-based awards if,
in its judgment, adjustment is warranted.
LONG TERM VARIABLE INCENTIVE
Long term variable incentive compensation opportunities are provided to
executives in positions with significant responsibilities, accountabilities and
potential impact on long term Corporate performance. Long term incentive
compensation is made available in the form of stock options and performance
based restricted stock awards.
"Stock Options" - The Maytag Corporation 1996 Employee Stock Incentive Plan
and the overall number of shares available have been approved by shareholders.
This plan provides the long term focus for approximately 960 executives and
other key employees. The size of stock option grants for the named executive
officers is determined at the discretion of the Committee.
"Performance-Based Restricted Stock" - The overall number of shares available
for grant under the Maytag Corporation 1996 Employee Stock Incentive Plan has
been approved by shareholders. Eligibility for participation and the level of
awards to individual executives are approved by the Committee. The level of
each award is based upon a percentage of base salary and varies depending upon
the executive's position and responsibilities. These performance based
restricted stock awards (which are currently composed of 60% restricted stock
and 40% restricted units) are subject to vesting provisions and dependent upon
the Corporation achieving predetermined levels of return on sales and return on
assets over a specified three year period. High levels of performance in these
factors, in the Committee's opinion, impact favorably on long term shareholder
value. The Corporation expects that approximately 70 executives will be
granted awards under this variable long term incentive.
"Summary" - Survey data indicates that grants approved by the Committee under
this Plan and predecessor long term plans are competitive with grants made to
executives in similar positions at other industrial organizations. This stock
based incentive plan is designed to encourage a significant equity ownership
interest in the company to help assure that the long term interests of the
Corporation's executives are closely aligned with the long term interests of the
shareholders.
EXECUTIVE STOCK OWNERSHIP GUIDELINES
In keeping with the Corporation's compensation philosophy and its efforts to
strengthen the link between the long term interests of executives and the long
term interests of shareholders, the Committee approved stock ownership
guidelines which are applicable to approximately 70 key executives. The
guidelines provide for the long term ownership of Maytag stock which in dollar
value aggregates a predetermined multiple of base salary. The amounts range
17
from four times annual base salary for the Chief Executive Officer to one times
annual base salary for operating unit vice presidents. The Committee reviews
executive stock ownership levels annually and during 1996 all executives either
attained their guidelines or made significant progress toward meeting their
guidelines.
TAX CODE LIMITATION ON EXECUTIVE COMPENSATION DEDUCTIONS
Unless certain conditions are met, Internal Revenue Code Section 162(m)
limits the annual deductibility of certain compensation in excess of $1 million
for the Chief Executive Officer and the four other most highly compensated
executive officers. As a result of Mr. Hadley's election to defer portions of
his 1996 annual variable compensation, there was no loss of tax deductibility in
1996 and the Committee does not anticipate any significant loss of tax
deductibility in 1997. In order to maintain maximum tax deductibility of
executive compensation, the Committee received approval from shareholders in
1996 for the long term variable incentive plan (1996 Employee Stock Incentive
Plan) to ensure tax deductibility of future long term compensation incentives.
The Committee will continue to monitor compensation programs in light of Section
162(m); however, the Committee considers it important to retain the flexibility
to design compensation programs that are in the best long term interests of the
Corporation and its shareholders.
SUMMARY
The Committee believes that the foregoing compensation programs will serve
the long term interests of shareholders. These programs create a strong link
between long term executive rewards and long term shareholder rewards; they
attract, retain and motivate outstanding executive talent; and they further the
Corporation's long term leadership succession objectives. The Committee will
continue to emphasize variable, performance based compensation programs that it
believes positively affect long term shareholder value. Finally, through stock
ownership guidelines, it is the goal of the Committee to ensure not only
qualified, professional managers, but fully committed "owner-operators".
PERFORMANCE OF THE CORPORATION AND CEO COMPENSATION
As indicated in the above discussion, the total compensation of the
Corporation's executives, including the CEO, consists of annual base salary,
annual variable incentive, and long term variable incentives, as well as other
fringe benefits. These plans consider individual performance, Corporation
performance, and survey data regarding comparable positions at other industrial
organizations.
The Corporation's performance in 1996 produced the highest earnings per share
figures (excluding special charges) since 1988. Return on assets improved to
7.4% in 1996 (excluding special charges) compared to 6.2% in 1995 (excluding
special charges). The strong financial results were driven by the Corporation's
strengthened balance sheet, the stock repurchase efforts that have reduced the
number of shares outstanding, and an outstanding year at Hoover. At the end of
1996, the Corporation is positioned for profitable growth. Maytag has the
products, customers, brand recognition, and financial discipline and strength to
grow. Maytag has taken the actions necessary to build the platform for growth
that will leverage these strengths. Other notable performance achievements for
1996 included:
The major appliance business unit reorganization consolidating administrative
functions, order entry, billing and accounting at Maytag Appliances'
18
headquarters; consolidating manufacturing of all cooking appliance
production; and consolidating sales forces was completed on time and on
budget.
Hoover continued its record setting performance due in large part to three
factors: new product introductions and model upgrades over the past year,
improved product mix to include more mid- to high-end models, and strong
relationships with dealers bolstered by Hoover's product line innovations and
breadth.
Mr. Hadley's 1996 salary of $648,000 represents an 8% increase over 1995. In
arriving at this rate, the Compensation Committee considered his annual base
salary compared to CEO compensation in the other industrial companies surveyed,
his outstanding performance as CEO during 1995, and his strategic actions and
plans for improving earnings in 1996 and beyond. Annual base salary increases
for the other named executives were based on individual performance, job content
and compensation of executives in comparable positions in the industrial
organizations surveyed.
The Committee-approved strategic and financial goals under the 1996 annual
variable incentive plan (discussed above) were set aggressively beyond 1995
performance. The Corporation's outstanding performance in 1996 fulfilled 100%
of the strategic goals and a significant percent of aggressive financial goals.
Based on this performance, Mr. Hadley received 1996 annual variable incentive
compensation of $600,000.
In 1996, a grant of restricted stock and stock units, based on percentages of
Mr. Hadley's and the other named executive officers' annual base salaries was
made. Payouts under the grant will be based on the extent to which the
Corporation achieves the return on sales and return on assets objectives for the
three year period January 1, 1996 through December 31, 1998, as reflected in the
Long-Term Incentive Plans Table. The restricted stock and units granted in 1994
matured in 1996. The Corporation's performance over the period January 1, 1994
through December 31, 1996 exceeded the maximum goals approved by the Committee
in 1994. A maximum grant payout was made under this Plan as reflected in the
Summary Compensation Table - LTIP Payouts.
As a component of long term variable incentive compensation, options to
purchase 146,260 shares of common stock were granted to Mr. Hadley under the
terms of the Corporation's 1996 Employee Stock Incentive Plan. This award is
competitive compared to the industrial companies surveyed. Grants of options to
the named executive officers are reflected in the Option/SAR Grants in Last
Fiscal Year Table.
The foregoing report is furnished by the following members of the Compensation
Committee:
Wayland R. Hicks W. Ann Reynolds Neele E. Stearns, Jr.
Bernard G. Rethore John A. Sivright
SHAREHOLDER RETURN PERFORMANCE
The following graph compares the Corporation's cumulative total shareholder
return on its common stock from December 31, 1991 to December 31, 1996 with the
S&P 500 Stock Index and the S&P Household Furnishings and Appliance Stock Index
(both of which include the Corporation).
19
Cumulative Total Return
Based on reinvestment of $100 beginning December 31, 1991
$300
$250
$200
Line graph depicting the amounts listed in table below.
$150
$100
$50
_____________________________________________________________________________
Dec. 91 Dec. 92 Dec 93 Dec 94 Dec 95 Dec 96
_____Maytag $100 $100 $124 $107 $148 $149
- - S & P $100 $104 $112 $110 $148 $178
- - -S & P $100 $109 $154 $123 $146 $141
Household
Furnishings &
Appliance Index
_____________________________________________________________________________
COMPENSATION OF DIRECTORS
Only directors who are not officers or employees of the Corporation are
entitled to compensation as directors and such directors are paid a
retainer of $24,000 per annum, $1,000 for each meeting of the Board
attended, $1,000 for attendance at each called committee meeting and
reimbursement for actual expenses. Telephone meetings are compensated at
$750 per meeting. Non-employee committee chairmen receive an additional
$3,500 per annum except the Executive Committee chair who receives an
additional $4,000.
All directors who are not employees of the Corporation or one of its
subsidiaries are participants in the Maytag Corporation Directors Pension
Plan (the "Directors Pension Plan"), an unfunded, noncontributory pension
plan. Under the Directors Pension Plan, each participant who ceases to be
a director of the Corporation after completion of at least 5 years of
service will receive a pension, beginning at the later of the director's
attaining age 70 or ceasing tenure as a director. Such pension will be an
annual amount, payable in monthly installments equal to the director's
annual retainer (excluding any fees for attendance of meetings of the Board
or any committee thereof, services as a committee chairman and expense
reimbursements) for the twelve-month period prior to the commencement of
such pension.
All directors who are not employees of the Corporation or one of its
subsidiaries are eligible to participate in the Maytag Directors Deferred
Compensation Plan, which provides that directors may elect to defer all or
a portion of compensation paid for services as a director until their
20
retirement or termination from the Board. Deferred amounts are paid
interest at the prime rate until retirement or termination. Benefits are
payable from the general assets of the Corporation. In the event of a
change of control of the Corporation all amounts deferred plus
accumulations are immediately payable in full.
Pursuant to the Corporation's Non-Employee Directors Stock Option Plan,
each non-employee director of the Corporation is awarded an option to
purchase 2,000 shares of the Corporation's common stock on the day
following the Annual Meeting of the Corporation's shareholders in each year
through 1999 (unless all shares available under such Plan become subject to
options prior to such time). The option price under each option is and
will be equal to the fair market value of the common stock on the date of
grant. The term of such options is five years from the date of grant.
Each option is exercisable immediately upon grant. The aggregate number of
shares of common stock that may be granted pursuant to the Non-Employee
Directors Stock Option Plan may not exceed 250,000, subject to adjustments
to reflect any future stock dividends, stock splits or other relevant
capitalization changes. Such Plan may not be amended or discontinued
without shareholder approval.
SHAREHOLDER PROPOSALS AND NOMINATIONS FOR 1997 ANNUAL MEETING
Proposals of shareholders intended for presentation at the 1998 Annual
Meeting must be received by the Secretary of the Corporation on or before
December 4, 1997, to be considered for inclusion in the 1998 Proxy
Statement and Proxy. The 1998 Annual Meeting is currently scheduled to be
held on May 14, 1998. The Nominating Committee will consider nominees
recommended by shareholders as candidates for election to the Board of
Directors at the Annual Meeting of Shareholders. A shareholder wishing to
nominate a candidate for election to the Board is required to give written
notice to the Secretary of the Corporation of his or her intention to make
such a nomination. The notice of nomination must be received by the
Corporation not less than sixty days nor more than ninety days prior to the
shareholders' meeting, or if less than seventy days notice or prior public
disclosure of the meeting date is given or made, the notice of nomination
must be received within ten days after the meeting date is announced. The
notice of nomination is required to contain certain information about both
the nominee and the shareholder making the nomination. The Corporation may
require that the proposed nominee furnish other information to determine
that person's eligibility to serve as a director. A nomination which does
not comply with the above procedure will be disregarded.
OTHER MATTERS
The Corporation will bear the cost of the proxy solicitation. In
addition to solicitation by mail, the Corporation will request banks,
brokers and other custodian nominees and fiduciaries to supply proxy
material to the beneficial owners of the Corporation's common stock of whom
they have knowledge, and will reimburse them for their expenses in so
doing; and certain directors, officers and employees of the Corporation,
21
not employed for the purpose, may solicit proxies, without additional
remuneration therefore, by personal interview, mail, telephone or
telegraph. The Corporation has retained Georgeson & Company Inc. to aid in
the solicitation of proxies for a fee of $12,500, plus out of pocket
expenses.
Neither the Corporation nor the members of its Board of Directors intend
to bring any other matters before the meeting, and they have no present
knowledge that any other matters will or may be brought before the meeting
by others. However, if any matters properly come before the meeting it is
the intention of the persons named in the accompanying form of proxy to
vote the proxy in accordance with their judgment.
22
PROXY CARD
----------
MAYTAG CORPORATION
Proxy for Annual Meeting, May 15, 1997, Solicited by the Board of Directors
Leonard A. Hadley, Gerald J. Pribanic and E. James Bennett, and each of
them (with full power to act without the other and with power of
substitution), are hereby appointed attorneys and proxies of the
undersigned to attend the Annual Stockholders Meeting on May 15, 1997, and
any adjournment thereof, and to vote and act for the undersigned on reverse
side:
This proxy revokes all previous proxies. Unless specified to the
contrary it will be voted FOR items (1) and (2).
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
X Please mark
votes as in
this example.
The Board of Directors recommends a vote "FOR" items (1) and (2).
1. Election of Directors
Nominees: Lester Crown, Bernard G. Rethore, Neele E. Stearns, Jr.,
Carole J. Uhrich.
FOR or WITHHELD
===== =========
ALL FROM ALL
NOMINEES NOMINEES
________________________________________
(INSTRUCTION: For all nominees except as noted above
___________________________________________________________________________
2. FOR AGAINST or ABSTAIN
The selection of Ernst & Young LLP as independent public auditors to
examine the financial statements to be included in the Annual Report to
Stockholders for 1997.
__________________________________________________________________________
In their discretion, the proxies are authorized to vote upon any other
matters which may properly come before the meeting or any adjournment.
Dated ______________________, 1997 Dated ______________________, 1997
_________________________________ _________________________________
(Signature of Stockholder) (Signature of Stockholder)
Please date, sign exactly as name appears above, and return in the enclosed
envelope. Executors, administrators, trustees, guardians or attorneys
should indicate the capacity in which they sign. Corporate owners should
sign in their corporate names and affix their seals.
______ MARK HERE
FOR ADDRESS
CHANGE AND
NOTE AT LEFT
April 3, 1997
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of shareholders to
be held at 9:00 a.m. on Thursday, May 15, 1997, at the Newton High School
Center for Performance, Newton, Iowa. Detailed information as to the
business to be transacted at the meeting is contained in the accompanying
Notice of Annual Meeting and Proxy Statement.
Regardless of whether you plan to attend the meeting, it is important that
your shares be voted. Accordingly, we ask that you sign and return your
proxy as soon as possible in the envelope provided.
Sincerely,
Leonard A. Hadley
Chairman and
Chief Executive Officer