SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
CK WITCO CORPORATION
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
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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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/ / 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
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CK WITCO
[LOGO] CORPORATION
Dear Stockholder:
You are cordially invited to attend the annual meeting of stockholders of CK
Witco Corporation to be held at 11:15 a.m. on Tuesday, April 25, 2000, at the
Sheraton Stamford Hotel, 2701 Summer Street, Stamford, Connecticut.
Information about the business of the meeting and the nominees for election
as members of the Board of Directors is set forth in the formal meeting notice
and Proxy Statement on the following pages. This year you are asked to elect
eight directors, to approve a change of name of the Corporation, and to ratify
the Board of Directors' selection of an independent auditor for the fiscal year
ending December 31, 2000.
It is important that your shares be represented at the meeting. Whether or
not you plan to attend the session in person, we hope that you will vote on the
matters to be considered and sign, date and return your proxy in the enclosed
envelope as promptly as possible.
The Company's fiscal year 1999 Annual Report is being mailed to stockholders
herewith, but it is not part of the proxy solicitation material.
Respectfully yours,
/s/ Vincent A. Calarco
Vincent A. Calarco
Chairman, President &
Chief Executive Officer
March 30, 2000
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NOTICE OF 2000 ANNUAL MEETING OF THE STOCKHOLDERS
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To the Stockholders:
The 2000 annual meeting of the stockholders of CK Witco Corporation will be
held at the Sheraton Stamford Hotel, 2701 Summer Street, Stamford, Connecticut,
on Tuesday, April 25, 2000, at 11:15 a.m. in the morning, local time, to
consider and act upon the following matters:
1. The election of eight directors to be divided into three classes to
serve for terms expiring in 2001, 2002 and 2003, described beginning on page
2 of the Proxy Statement which follows;
2. A proposal to approve and adopt an amendment to the Corporation's
Restated Certificate of Incorporation to change the name of the Corporation
to Crompton Corporation, described beginning at page 16;
3. A proposal to ratify the selection by the Board of Directors of an
independent auditor for 2000, described beginning at page 17; and
4. Such other business as may properly come before the meeting.
Your attention is directed to the accompanying Proxy Statement for
additional information with respect to the matters to be considered at the
meeting.
Stockholders of record at the close of business on February 25, 2000, are
entitled to notice of the annual meeting and may vote at the meeting and any
adjournment thereof. We urge you to date, sign and return the enclosed proxy
promptly whether or not you plan to attend the annual meeting. If you attend the
meeting, you may still vote your shares in person, if you wish.
By Order of the Board of Directors,
/s/ John T. Ferguson II
JOHN T. FERGUSON II
Secretary
March 30, 2000
CK Witco Corporation, One American Lane, Greenwich, CT 06831
PROXY STATEMENT
CK Witco Corporation (the "Corporation") is a Delaware corporation formed by
the merger of Crompton & Knowles Corporation ("Crompton & Knowles"), a
Massachusetts corporation, and Witco Corporation ("Witco"), a Delaware
corporation, effective September 1, 1999.
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors of the Corporation (the "Board" or the "Board of
Directors") for use at the annual meeting of the stockholders of the Corporation
to be held on April 25, 2000, at the Sheraton Stamford Hotel, 2701 Summer
Street, Stamford, Connecticut, and at any adjournment thereof.
Holders of Common Stock of the Corporation of record at the close of
business on February 25, 2000, the record date, are entitled to notice of and to
vote at the meeting and any adjournment thereof. On the record date, there were
outstanding and entitled to vote 114,004,574 shares of Common Stock, each of
which is entitled to one vote. The Corporation has no other voting securities
issued and outstanding.
If a stockholder is participating in the Corporation's Dividend Reinvestment
Plan, the shares held in a person's account under the Plan will be voted
automatically in the same way that such person's shares held of record are
voted.
Any stockholder giving a proxy may revoke it by executing another proxy
bearing a later date or by notifying the Secretary in writing at any time prior
to the voting of the proxy. Mere attendance at the annual meeting does not
revoke a proxy.
The Corporation's annual report for the fiscal year ended December 31, 1999,
accompanies this Proxy Statement. It is not proxy soliciting material, nor is it
incorporated herein by reference.
This Proxy Statement and the enclosed form of proxy are first being sent to
stockholders on or about March 30, 2000.
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following persons were known to the Board of Directors to be the
beneficial owner of more than 5% of the Corporation's outstanding voting
securities as of December 31, 1999:
Capital Research and Management Company..................... 11,015,420(1) 9.29%
333 South Hope Street
Los Angeles, CA 90071
Barrow, Hanley, Mewhinney & Strauss, Inc.................... 9,753,753(2) 8.23%
3232 McKinney Avenue
Dallas, TX 75204
Fidelity Management & Research.............................. 6,465,543(3) 5.45%
82 Devonshire Street
Boston, MA 02109
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(1) Capital Research and Management Company has advised that they have sole
dispositive power for 11,015,420 shares. Capital Research and Management
Company disclaims beneficial ownership of all shares pursuant to
Rule 13d-4.
(2) Barrow, Hanley, Mewhinney & Strauss, Inc. has advised that they have sole
voting power for 2,009,385 shares, shared voting power for 7,744,368 shares
and sole dispositive power for 9,753,753 shares. Barrow, Hanley, Mewhinney &
Strauss, Inc. acts as investment advisor for Vanguard Windsor Funds--Windsor
II Fund with respect to 6,238,569 of the shares listed above.
(3) Fidelity Management & Research has advised that they have sole voting power
for 1,024,381 shares and sole dispositive power for 6,465,543 shares.
ELECTION OF EIGHT DIRECTORS
The By-Laws of the Corporation provide for a board of directors of not less
than eight nor more than fifteen directors, as determined from time to time by a
resolution of the Board, divided into three classes. Directors of one class are
elected each year for a term of three years except in the initial year of
classification of the Board when Class I directors are elected for a term of one
year, Class II directors are elected for a term of two years and Class III
directors are elected for a term of three years. There are currently eleven
directors in office, three of whom are standing for election as Class I
directors whose term will expire at the 2001 annual meeting, two of whom are
standing for election as Class II directors whose term will expire at the 2002
annual meeting, and three of whom are standing for election as Class III
directors whose term will expire at the 2003 annual meeting. All directors so
elected will continue to serve until their respective successors are elected and
have qualified. All nominees are members of the present Board who have served as
directors since the dates set forth after their names. If any of the nominees
are not available, an event not anticipated, the proxies will be voted for the
other nominees and for a substitute if any is designated by the Board of
Directors. Mr. James A. Bitonti and Dr. Nicholas Pappas will reach age 70 during
the fiscal year, the normal retirement age for directors, and Mr. Simeon
Brinberg, who is not standing for election, will retire from the Board effective
on the date of the 2000 annual meeting.
NOMINEES FOR DIRECTOR
CLASS I (TO SERVE UNTIL THE ANNUAL MEETING OF STOCKHOLDERS
IN 2001)
LEO I. HIGDON, JR., 53, is the President of Babson College,
[LOGO] Babson Park, MA, and a former Dean of the Darden Graduate
School of Business Administration of the University of
Virginia, Charlottesville, VA. Mr. Higdon is also a former
Managing Director and member of the Executive Committee of
Salomon Brothers, an investment banking firm, New York, NY.
Mr. Higdon has been a director of the Corporation since 1999
and was a director of Crompton & Knowles from 1993 to 1999.
Mr. Higdon is Chairman of the Finance and Pension Committee.
He also serves as a director of Bestfoods, Newmont Mining
Corporation and Eaton Vance Corp.
C. A. (LANCE) PICCOLO, 59, is President and Chief Executive
[LOGO] Officer of HealthPic Consultants, Inc., a strategic
health-care consulting firm, Lincolnshire, IL. Prior to the
merger of Caremark International Inc. and
MedPartners/Mullikin, Inc., he was the Chairman and Chief
Executive Officer of Caremark International Inc., a provider
of alternate-site health-care services, North Brook, IL. He
is former Executive Vice President of Baxter
International Inc., a supplier of health-care products,
Deerfield, IL. Mr. Piccolo has been a director of the
Corporation since 1999 and was a director of Crompton &
Knowles from 1988 to 1999. Mr. Piccolo is a member of the
Audit and the Safety, Health and Environment Committees. He
also serves as a director and Vice Chairman of the Board of
MedPartners, Inc.
2
BRUCE F. WESSON, 57, is President of Galen Associates, a
health care venture firm, New York, NY and a General Partner
of Galen Partners L.P., New York, NY. Prior to
January 1991, he was Senior Vice President and Managing
Director of Smith Barney, Harris Upham & Co. Incorporated,
an investment banking firm, New York, NY. Mr. Wesson has
been a director of the Corporation since 1999 and was a
director of Witco from 1980 to 1999. Mr. Wesson is Chairman
of the Audit Committee. He also serves as a director of
Halsey Drug Co., Inc.
[LOGO]
CLASS II (TO SERVE UNTIL THE ANNUAL MEETING OF STOCKHOLDERS
IN 2002)
ROBERT A. FOX, 62, is President and Chief Executive Officer
[LOGO] of Foster Farms, a privately held, integrated poultry
company, Livingston, CA. He is former Executive Vice
President of Revlon, Inc., a cosmetics, fragrances and
toiletries manufacturer, New York, NY; and former Chairman
and Chief Executive Officer of Clarke Hooper America, an
international marketing services firm, Irvine, CA. Mr. Fox
has been a director of the Corporation since 1999 and was
director of Crompton & Knowles from 1990 to 1999. Mr. Fox is
a member of the Audit and the Safety, Health and Environment
Committees. He also serves as a director of the American
Balanced Fund, Fundamental Investors, the Growth Fund of
America, Inc., the Income Fund of America, Inc., the New
Perspective Fund and the New World Fund, Inc. He also
serves as a trustee of the Euro-Pacific Growth Fund.
HARRY G. HOHN, 68, was Chairman of the Board and Chief
Executive Officer of New York Life Insurance Company, New
York, NY from 1990 to 1997. Mr. Hohn has been a director of
the Corporation since 1999 and was a director of Witco from
1989 to 1999. Mr. Hohn is a member of the Finance and
Pension and the Organization, Compensation and Governance
Committees. He also serves as a director of New York Life
Insurance Company and The Mainstay Funds.
[LOGO]
CLASS III (TO SERVE UNTIL THE ANNUAL MEETING OF STOCKHOLDERS
IN 2003)
3
VINCENT A. CALARCO, 57, is President and Chief Executive
Officer of the Corporation and was named Chairman of the
Board in November 1999. Prior to the merger of Crompton &
Knowles and Witco, Mr. Calarco served as Chairman of the
Board, President and Chief Executive Officer of Crompton &
Knowles. Mr. Calarco has been a director of the Corporation
since 1999 and was a director of Crompton & Knowles from
1985 to 1999. He also serves as a director of Rhodia, S.A.
and Newmont Mining Corporation.
[LOGO]
ROGER L. HEADRICK, 63, is the Managing General Partner of
[LOGO] HMCH Ventures, an investment company, Wayzata, MN, the
President and Chief Executive Officer of ProtaTek
International, Inc., a biotechnical animal vaccine company,
St. Paul, MN and the President and Chief Executive Officer
of New Biotics, Inc., a cancer research and development
company, San Diego, CA. Mr. Headrick is the former President
and Chief Executive Officer of the Minnesota Vikings
Football Club, Inc., Eden Prairie, MN. Mr. Headrick has been
a director of the Corporation since 1999 and was a director
of Crompton & Knowles from 1988 to 1999. Mr. Headrick is a
member of the Finance and Pension and the Organization,
Compensation and Governance Committees. He also serves as a
director of Caremark Rx, Inc.
PATRICIA K. WOOLF, PH.D., 65, is a private investor, and
[LOGO] lecturer in the Department of Molecular Biology, Princeton
University, Princeton, NJ. Dr. Woolf has been a director of
the Corporation since 1999 and was a director of Crompton &
Knowles from 1994 to 1999. Dr. Woolf is a member of the
Audit and the Safety, Health and Environment Committees. She
also serves as a director of the American Balanced Fund,
Fundamental Investors, the Growth Fund of America, Inc., the
Income Fund of America, Inc., Smallcap World Fund, Inc.,
General Public Utilities Corporation and the National Life
Holding Co. Dr. Woolf also serves as a trustee of the New
Economy Fund.
The affirmative vote of the holders of a plurality of the shares that are
present in person or represented by proxy at the meeting is required to elect
directors.
The Board of Directors recommends a vote FOR the election as directors of
the persons named herein, and proxies will be so voted unless stockholders
specify to the contrary in their proxies or specifically withhold authority to
vote for any individual nominee.
BOARD MEETINGS AND COMMITTEES
The Board of Directors held one regular and one special meeting during 1999.
Each incumbent director attended at least 75% of the aggregate number of
meetings held during 1999 by the Board of Directors, the board of directors of
the respective predecessor corporation on which the director served, and those
of both boards of directors' committees on which they served.
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The Board has established four committees to assist it in the discharge of
its responsibilities. The Audit Committee, no member of which is an employee of
the Corporation, meets periodically with the Corporation's management to review
the Corporation's major financial risk exposures and with the independent
auditor to review the scope of the annual audit and the policies relating to
internal auditing procedures and controls, provides general oversight with
respect to the accounting principles employed in the Corporation's financial
reporting, and reviews the Corporation's annual report on Form 10-K prior to its
filing. The Audit Committee also recommends to the Board each year the selection
of the auditor, evaluates the auditor's performance, has responsibility for
approving professional non-audit services provided by the independent auditor,
considers the possible effect of providing such non-audit services on the
auditor's independence, and reviews the range of fees of the auditor for both
audit and non-audit services. The Audit Committee held two meetings during 1999.
The Crompton & Knowles Audit Committee met once during 1999.
The Organization, Compensation and Governance Committee comprises directors
who are not employees of the Corporation. Its functions include approval of the
level of compensation for executive officers serving on the Board, adoption of
bonus and deferred compensation plans and arrangements for executive officers,
and the administration of the Corporation's compensation plans. The
Organization, Compensation and Governance Committee also makes recommendations
with respect to the organization, size and composition of the Board, identifies
suitable candidates for Board membership and reviews their qualifications,
proposes a slate of directors for election by the stockholders at each annual
meeting, and assists the Board in providing for orderly succession in the top
management of the Corporation. The Organization, Compensation and Governance
Committee held one meeting in 1999. The Executive Compensation Committee of
Crompton & Knowles met twice and the Nominating Committee of Crompton & Knowles
met once during 1999.
The Finance and Pension Committee comprises directors who are not employees
of the Corporation. The Committee has the authority, which it may exercise when
the Board is not in session, to approve certain debt financings and reviews and
makes recommendations to the Board regarding the issuance or reacquisition of
securities, major debt financings, capital expenditures, acquisitions,
divestitures and other expenditures, dividend policy, management of pension
assets, and risk management policy and strategy. The Finance and Pension
Committee held one meeting in 1999. The Finance Committee of Crompton & Knowles
did not meet in 1999.
The Safety, Health and Environment Committee comprises directors who are not
employees of the Corporation. The Committee provides guidance to and oversight
of management with respect to safety, health and environmental matters including
the review of the Corporation's safety, health and environmental performance,
policies, standards, procedures, management systems and strategic plans. The
Committee also recommends actions and policies that will enable the Corporation
to achieve a high level of safety, health and environmental performance compared
with its peers in the chemical industry and to maintain good relations with the
Corporation's neighbors. The Safety, Health and Environment Committee held one
meeting in 1999.
COMPENSATION OF DIRECTORS
Directors who are employees of the Corporation receive no additional
compensation for services on the Board of Directors. Members of the Board who
are not employees receive an annual retainer of $35,000 (committee chairmen
receive an additional retainer of $5,000) and a fee of $12,000 for Board and
committee meeting service, and are reimbursed for expenses incurred in attending
meetings. The Corporation provides accidental death and travel insurance
coverage for each non-employee director.
Each year non-employee directors may elect to defer all or any portion of
their retainers and fees in the form of shares of the Corporation's Common
Stock.
5
The CK Witco Corporation 1998 Long Term Incentive Plan (the "1998 Plan")
provides for the issuance to non-employee directors on the date of the first
meeting of the Board in the fourth quarter of each year of an option to purchase
up to 7,500 shares of the Corporation's Common Stock. The exercise price of the
options may not be less than the fair market value of the Corporation's Common
Stock on the grant date. The options to be granted under the 1998 Plan are
non-qualified options not intended to qualify as incentive stock options under
the Internal Revenue Code of 1986, and may not be exercisable more than
10 years and one month after the date of grant.
STOCKHOLDER NOMINATIONS
The Organization, Compensation and Governance Committee will consider
qualified candidates proposed by stockholders for Board membership in accordance
with the procedure set forth in the By-Laws. Any stockholder entitled to vote in
the election of directors may nominate one or more persons for election as a
director at a meeting if written notice of such stockholder's intent to make
such nomination or nominations has been given, either by personal delivery or by
mail, postage prepaid, to the Secretary of the Corporation not later than
90 days prior to the anniversary date of the immediately preceding annual
meeting or the close of business on the tenth day following the date on which
notice of such meeting is first given to stockholders, whichever is earlier.
Notwithstanding the foregoing sentence, in the event that the number of
directors to be elected to the Board is increased and there is no public
announcement by the Corporation naming all of the nominees or specifying the
size of the increased Board at least 70 days prior to the first anniversary of
the preceding year's annual meeting, a stockholder's notice shall also be
considered timely, but only with respect to nominees for new positions created
by such increase, if delivered to the Secretary not later than the close of
business on the tenth day following the day on which such public announcement is
first made by the Corporation. Each such notice shall set forth (i) the name and
address of the stockholder who intends to make the nomination and of the person
or persons to be nominated; (ii) a representation that the stockholder is a
holder of record of stock of the Corporation entitled to vote at such meeting
having a value of at least $1,000 and intends to appear in person or by proxy at
the meeting to nominate the person or persons specified in the notice; (iii) a
description of all arrangements or understandings between the stockholder and
each nominee and any other person or persons (naming such person or persons)
pursuant to which the nomination or nominations are to be made by the
stockholder; (iv) such other information regarding each nominee proposed by such
stockholder as would be required to be included in a proxy statement filed
pursuant to the proxy rules of the Securities and Exchange Commission; and
(v) the consent of each nominee to serve as a director of the Corporation, if so
elected. The presiding officer of the meeting may refuse to acknowledge the
nomination of any person not made in compliance with the foregoing procedure.
SECURITY OWNERSHIP OF MANAGEMENT
The nominees for director and the executive officers of the Corporation have
advised that they were directly or indirectly the beneficial owners of
outstanding Common Stock of the Corporation at
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the close of business on February 25, 2000, as set forth below, in each case
representing less than one percent of such shares outstanding except as
otherwise indicated.
AMOUNT AND
NATURE OF
TITLE OF BENEFICIAL PERCENT
CLASS NAME OF BENEFICIAL OWNER OWNERSHIP(1) OF CLASS
- -------- ------------------------------------------- ------------- --------
Common Vincent A. Calarco......................... 2,412,721(2) 2.1%
Common James A. Bitonti........................... 54,100(3)
Common Simeon Brinberg............................ 13,436(4)
Common Robert A. Fox.............................. 84,104(5)
Common Roger L. Headrick.......................... 103,388(6)
Common Leo I. Higdon, Jr. ........................ 31,713(7)
Common Harry G. Hohn.............................. 17,430(8)
Common Nicholas Pappas............................ 9,117(9)
Common C.A. (Lance) Piccolo....................... 40,081(10)
Common Bruce F. Wesson............................ 18,026(11)
Common Patricia K. Woolf.......................... 27,345(12)
Common Joseph B. Eisenberg........................ 301,304(13)
Common Alfred F. Ingulli.......................... 495,823(14)
Common Charles J. Marsden......................... 526,515(15)
Common William A. Stephenson...................... 250,557(16)
Common Directors and Executive Officers
as a Group (26 persons).................... 5,918,925(17) 5.1%
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(1) Except as noted below, the executive officers and directors have both sole
voting and sole investment power over the shares reflected in this table.
(2) Includes 1,142,262 shares which Mr. Calarco had the right to acquire through
stock options exercisable within 60 days of February 25, 2000; 648,411
shares held under the 1988 Long Term Incentive Plan (the "1988 Plan") and
the CK Witco Corporation Employee Stock Ownership Plan (the "ESOP"), as to
which he has voting but, except with respect to 47,639.85 shares in the
ESOP, no investment power; 23,170.98 shares acquired through the Dividend
Reinvestment Plan (the "DRIP"); 1,918 shares acquired through the BEP Trust;
58,872 shares owned by his wife and 29,833 shares held in trust for their
children, as to which he disclaims beneficial ownership.
(3) Includes 18,290 shares which Mr. Bitonti had the right to acquire through
stock options exercisable within 60 days of February 25, 2000; 15,998 shares
held under the Restricted Stock Plan for Directors; 4,800 shares owned by
his wife, as to which he disclaims beneficial ownership; 2,778 shares held
in a Directors' Rabbi Trust Account; 1,033.86 shares acquired through the
DRIP and 11,200 shares held jointly with his wife.
(4) Includes 10,479 shares which Mr. Brinberg acquired through deferred
compensation and which were deposited into a Directors' Rabbi Trust account.
(5) Includes 18,290 shares which Mr. Fox had the right to acquire through stock
options exercisable within 60 days of February 25, 2000; 13,952 shares held
under the Restricted Stock Plan for Directors; 66.44 shares acquired through
the DRIP and 4,234 shares held through a Directors' Rabbi Trust account.
(6) Includes 18,290 shares which Mr. Headrick had the right to acquire through
stock options exercisable within 60 days of February 25, 2000; 15,677 shares
held under the Restricted Stock Plan for Directors; 987.70 shares acquired
through the DRIP and 4,433 shares held through a Directors' Rabbi Trust
account.
7
(7) Includes 17,448 shares which Mr. Higdon had the right to acquire through
stock options exercisable within 60 days of February 25, 2000; 2,727 shares
held under the Restricted Stock Plan for Directors; 49.35 shares acquired
through the DRIP and 4,489 shares held through a Directors' Rabbi Trust
account.
(8) Includes 16,497 shares which Mr. Hohn acquired through deferred compensation
and which were deposited into a Directors' Rabbi Trust account.
(9) Includes 8,193 shares which Dr. Pappas acquired through deferred
compensation and which were deposited into a Directors' Rabbi Trust account.
(10) Includes 18,290 shares which Mr. Piccolo had the right to acquire through
stock options exercisable within 60 days of February 25, 2000; 14,139 shares
held under the Restricted Stock Plan for Directors; 869.15 shares acquired
through the DRIP and 4,383 shares held through a Directors' Rabbi Trust
account.
(11) Includes 14,791 shares which Mr. Wesson acquired through deferred
compensation and which were deposited into a Directors' Rabbi Trust account.
(12) Includes 16,515 shares which Dr. Woolf had the right to acquire through
stock options exercisable within 60 days of February 25, 2000; 6,288 shares
held under the Restricted Stock Plan for Directors; 158.60 shares acquired
through the DRIP and 4,383 shares held through a Directors' Rabbi Trust
account.
(13) Includes 242,485 shares which Dr. Eisenberg had the right to acquire
through stock options exercisable within 60 days of February 25, 2000 and
11,108.86 shares held under the 1988 Plan and the ESOP, as to which he has
voting but, except with respect to 249.55 shares in the ESOP, no investment
power.
(14) Includes 361,231 shares which Mr. Ingulli had the right to acquire through
stock options exercisable within 60 days of February 25, 2000 and 11,235.68
shares held under the 1988 Plan and the ESOP as to which he has voting but,
except with respect to 376.47 shares in the ESOP, no investment power.
(15) Includes 209,825 shares which Mr. Marsden had the right to acquire through
stock options exercisable within 60 days of February 25, 2000; 90,659.75
shares held under the 1988 Plan and the ESOP, as to which he has voting but,
except with respect to 11,491.30 shares in the ESOP, no investment power;
and 45,500 shares owned by his wife as to which he disclaims beneficial
ownership.
(16) Includes 196,293 shares which Mr. Stephenson had the right to acquire
through stock options exercisable within 60 days of February 25, 2000 and
11,215 shares held under the 1988 Plan and the ESOP as to which he has
voting but, except with respect to 356.33 shares in the ESOP, no investment
power.
(17) Includes 3,096,540 shares which the executive officers and directors in the
group had the right to acquire through stock options exercisable within
60 days of February 25, 2000; 1,160,434.44 shares held under the 1988 Plan
and the ESOP, as to which they have voting but, except with respect to
227,478.81 shares in the ESOP, no investment power; 29,660.69 shares
acquired through the DRIP; 141,606.46 shares owned by wives and in trusts
for sons, as to which beneficial ownership is disclaimed; 11,200 shares held
jointly with wives and 102,953 shares held through a Directors' Rabbi Trust
accounts.
8
REPORT OF THE COMMITTEE ON EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION PHILOSOPHY
The compensation program for the Corporation's executive officers is
administered in accordance with a pay for performance philosophy to link
executive compensation with the values, objectives, business strategy,
management initiatives and financial performance of the Corporation. In
addition, a significant portion of each executive officer's compensation is
contingent upon the creation of shareholder value.
The Organization, Compensation and Governance Committee of the Board (the
"Committee") believes that stock ownership by management and restricted
stock-based performance compensation plans serve to align the interests of
management and other stockholders in the enhancement of shareholder value. To
that end, executive officers are encouraged to retain the shares they earn
through the compensation programs and are given the opportunity to defer
payments into shares of common stock that will not be paid out until they retire
from the company.
The Compensation of the Corporation's executive officers is comprised of
cash and equity components and is designed to be competitive and highly
leveraged based upon corporate financial performance and shareholder returns.
The compensation program provides an opportunity to earn compensation in the
third quartile within the chemical industry as well as within a broader group of
companies of comparable size and complexity. Actual compensation levels may be
greater or less than competitive levels in surveyed companies based upon annual
and long-term performance of the Corporation as well as individual performance.
Several performance measures are used for compensation purposes for the
Corporation's executive officers and heads of the businesses. Primary measures
used in the annual and long-term incentive programs include earnings growth and
return on capital, with executives also linked to shareholder return through
stock options and restricted performance share awards.
BASE SALARIES
Base salary ranges at the median to 75(th) percentile levels for executive
officers are determined after reviewing data from several national surveys on
salaries for executives at broad groups of companies of similar size and
complexity.
MANAGEMENT INCENTIVE PLAN
Annual incentives are paid under the Corporation's Management Incentive
Plan. Target and maximum incentives (currently at 175% of target) are set to
offer executive officers an opportunity to earn annual compensation at the
75(th) percentile levels if high levels of performance are met.
STOCK OPTIONS AND PERFORMANCE SHARES
Long-term incentives at the Corporation consist of annual grants of stock
options and periodic grants of restricted performance shares that will be earned
over a multi-year period based on goals selected by the Committee out of those
approved under the 1998 Long-Term Incentive Plan. Awards are divided evenly in
value between stock options and restricted performance shares and are set at
levels designed to offer opportunities at the 75(th) percentile.
STOCK OWNERSHIP
The Corporation has adopted stock ownership goals for its executive
officers, which range from five times salary for the CEO to two times salaries
for the remaining officers. Total stock ownership for this group as of
February 25, 2000, is 2,446,310 shares.
9
TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION
The Committee's policy on the tax deductibility of compensation is to
maximize deductibility to the extent possible without abdicating all of its
discretionary power. To this end, the Committee has submitted complying plans to
shareholders; however, the Committee has occasionally taken actions that result
in non-deductible compensation and may do so again in the future when it
determines that such actions are in the Corporation's best interests.
SPECIAL ACTIONS FOR 1999
The Committee took several special actions in conjunction with the
completion of the merger with Witco Corporation in September 1999. Those actions
included the grant of stock option awards to a broad group of employees, the
adoption of a plan that provides for stock awards if specified cost savings are
realized through merger synergies, the termination of a previously approved
Crompton & Knowles long term incentive program, and adjustments to compensation
levels for those with increased responsibilities after the merger.
COMPENSATION OF CHIEF EXECUTIVE OFFICER
In 1999, the base salary, incentive compensation, stock option and
restricted stock awards for the Chief Executive Officer were determined by the
Board of Directors based on the recommendations of the Committee using the
principles outlined above. At the time of the merger with Witco Corporation, the
CEO's base salary was increased from $780,000 to $810,000. Subsequently, his
base salary was increased from $810,000 to $825,000 effective February 1, 2000.
For 1999, the CEO was awarded a bonus of $405,000 in recognition of his efforts
in concluding the merger with Witco. On October 19, 1999, he was granted a stock
option award of 800,000 shares, which was a combination award for the regular
annual award and for concluding the merger. In October he was granted a "Synergy
Performance Award" with an opportunity to earn 500,000 shares of restricted
stock, or the cash equivalent, upon the achievement of specified synergy savings
relating to the merger. Any award so earned would be payable over a three-year
period following independent certification of the results.
ORGANIZATION, COMPENSATION AND GOVERNANCE COMMITTEE
Decisions on compensation of the Corporation's executive officers are made
by the Organization, Compensation and Governance Committee, a committee of the
Board of Directors composed of the persons listed below, all of whom are
non-employee directors. The Committee has retained an independent executive
compensation consultant who has access to independent compensation data to
evaluate the Corporation's executive compensation program.
The Organization, Compensation and Governance Committee:
James A. Bitonti, Chairman
Robert A. Fox
Roger L. Headrick
Notwithstanding anything to the contrary set forth in any of the
Corporation's previous filings under the Securities Act of 1933 or the
Securities Exchange Act of 1934 (the "Exchange Act") that might incorporate
future filings, including this Proxy Statement, in whole or in part, the
foregoing Report of the Organization, Compensation and Governance Committee and
the following Performance Graph shall not be deemed incorporated by reference
into any such filings.
10
PERFORMANCE GRAPH
The following graph compares the cumulative total return on the Common Stock
of the Corporation for the last five fiscal years with the returns on the
Standard & Poor's 500 Stock Index and the Chemicals (Specialty)-500 Index,
assuming the investment of $100 in the Corporation's Common Stock, the S&P 500
Index and the Chemicals (Specialty)-500 Index on December 31, 1994, and the
reinvestment of all dividends.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF FIVE-YEAR
CUMULATIVE TOTAL RETURN AMONG CK WITCO CORP,
S&P 500, & CHEMICALS (SPECIALTY)-500
CHEMICALS
CK WITCO CORPORATION S&P 500 (SPECIALTY)-500
12/31/94 $100.0 $100.0 $100.0
12/31/95 $84.3 $137.5 $131.4
12/31/96 $124.7 $169.1 $134.9
12/31/97 $172.0 $225.5 $167.0
12/31/98 $135.8 $290.0 $142.2
12/31/99 $87.6 $351.0 $157.4
Note: Assumes and initial investment of $100 on December 31,
1994.
Total return includes reinvestment of dividends.
The Chemicals (Specialty)-500 Index companies are as follows: Ecolab Inc.,
W.R. Grace & Co., Great Lakes Chemical Corporation, Hercules, Inc.,
International Flavors & Fragrances Inc. and Sigma-Aldrich Corporation.
11
EXECUTIVE COMPENSATION
The following tables set forth information concerning compensation paid or
to be paid to the chief executive officer of the Corporation and each of the
four most highly compensated executive officers of the Corporation other than
the chief executive officer, for services to the Corporation in all capacities
during 1997, 1998 and 1999, except as noted, and options granted to and
exercised by the same individuals during the period indicated.
SUMMARY COMPENSATION TABLE
LONG TERM
COMPENSATION
-----------------------
ANNUAL COMPENSATION AWARDS
------------------------------- -----------------------
RESTRICTED SECURITIES ALL OTHER
NAME AND STOCK UNDERLYING COMPEN-
PRINCIPAL SALARY BONUS AWARDS OPTIONS SATION
POSITION YEAR ($) ($) ($)(1)(2) (#) ($)(3)
- --------- -------- -------- --------- ---------- ---------- ---------
Vincent A. Calarco................. 1999 787,500 405,000 -- 800,000 152,905
Chairman of the Board, 1998 748,333 750,000 -- 250,000 170,750
President and CEO 1997 727,500 800,000 -- 120,000 137,271
Charles J. Marsden................. 1999 330,000 95,000 -- 200,000 59,017
Senior Vice President 1998 315,000 180,000 -- 75,000 60,154
Strategy & Development 1997 300,000 180,000 -- 30,000 52,649
Alfred F. Ingulli.................. 1999 312,917 100,000 -- 100,000 45,952
Exec. Vice President, 1998 287,500 100,000(4) -- 50,000 30,588
Crop Protection 1997 271,667 180,000 -- 20,000 27,853
William A. Stephenson.............. 1999 266,333 142,500 -- 100,000 23,613
Exec. Vice President, 1998 257,000 85,000(4) -- 40,000 12,975
Urethanes & Petroleum 1997 246,833 170,000 -- 20,000 24,113
Additives
Joseph B. Eisenberg................ 1999 294,583 100,000 -- 200,000 43,873
Exec. Vice President, 1998 261,250 130,000(4) -- 50,000 20,881
Polymer Additives 1997 246,000 145,000 -- 20,000 21,395
- ------------------------
(1) Total restricted stock outstanding for the persons shown in the table at the
end of fiscal year 1999: Vincent A. Calarco, 486,245 shares valued at
$6,503,527, of which 342,245 shares valued at $4,577,527 are forfeitable;
Charles J. Marsden, 128,900 shares valued at $1,724,038, of which 84,900
shares valued at $1,135,538 are forfeitable; Alfred F. Ingulli, 31,500
shares valued at $421,313, all of which shares are forfeitable; William A.
Stephenson, 31,500 shares valued at $421,313, all of which shares are
forfeitable; and Joseph B. Eisenberg, 31,500 shares valued at $421,313, all
of which shares are forfeitable. Dividends are paid on restricted shares
from the date of grant but do not vest and are not distributed until the
underlying shares are distributed.
(2) At the time of the merger, a Crompton & Knowles Long Term Incentive Plan for
the period 1999-2001 was terminated. Upon the termination of the plan, the
following payments were made to the individuals identified in the table.
Vincent A. Calarco $5,243,907, Charles J. Marsden $728,320, Alfred F.
Ingulli $154,492, William A. Stephenson $220,703, and Joseph B. Eisenberg
$463,477. These amounts are not included in the table above.
(3) Includes the following amounts paid during 1999 under the Corporation's
Supplemental Medical and Dental Reimbursement Plans (the "SMD"), The
Uniroyal Age Supplement ("AS"), the
12
Uniroyal Chemical split dollar life insurance plan (the "SDP"), the Uniroyal
Excess Cap Program (the "ECAP") or as employer contributions under the
Corporation's Employee Stock Ownership Plan (ESOP) and Individual Account
Retirement Plan (IARP) (with that portion of the ESOP and IARP contributions
in excess of the Section 401(k) and Section 415 limitations having been paid
into the Corporation's Benefit Equalization Plan): Mr. Calarco, $4,017
(SMD), $47,700 (ESOP), $73,575 (IARP); Mr. Marsden, $1,500 (SMD), $17,000
(ESOP), $25,975 (IARP); Mr. Ingulli, $12,787 (AS), $7,788 (SDP), $9,377
(ECAP), $6,400 (ESOP), $9,600 (IARP); Mr. Stephenson, $3,628 (AS), $4,353
(ECAP), $6,032 (ESOP), $9,600 (IARP); and Dr. Eisenberg, $13,163 (AS),
$3,610 (SDP), $9,653 (ECAP), 4,265 (ESOP), $9,600 (IARP).
(4) Bonus applies to five quarters including fourth quarter 1996.
OPTION GRANTS IN LAST FISCAL YEAR(1)
INDIVIDUAL GRANTS
-------------------------------------------------
PERCENT POTENTIAL REALIZABLE
NUMBER OF TOTAL VALUE AT ASSUMED
OF OPTIONS ANNUAL RATES OF STOCK
SECURITIES GRANTED TO PRICE APPRECIATION
UNDERLYING EMPLOYEES EXERCISE EXPIR- FOR OPTION TERM
OPTIONS IN FISCAL PRICE ATION ----------------------
NAME GRANTED(#) YEAR ($/SH) DATE 5% ($) 10%($)
- ---- ---------- ---------- -------- -------- --------- ----------
V.A. Calarco................ 788,015(2) 18.24% 8.34375 11/19/09 4,134,982 10,478,857
11,985(3) 0.28% 8.34375 10/19/09 62,889 159,374
C.J. Marsden................ 188,015(2) 4.35% 8.34375 11/19/09 986,579 2,500,184
11,985(3) 0.28% 8.34375 10/19/09 62,889 159,374
A.F. Ingulli................ 100,000(2) 2.31% 8.34375 11/19/09 524,734 1,329,779
W. A. Stephenson............ 88,015(2) 2.04% 8.34375 11/19/09 461,845 1,170,405
11,985(3) 0.28% 8.34375 10/19/09 62,889 159,374
J.B. Eisenberg.............. 188,015(2) 4.35% 8.34375 11/19/09 986,579 2,500,184
11,985(3) 0.28% 8.34375 10/19/09 62,889 159,374
- ------------------------
(1) An option entitles the holder to purchase one share of the Common Stock of
the Corporation at a purchase price equal to the fair market value of the
Corporation's Common Stock on the date of grant of all of the options shown
in the table. All options are subject to expiration prior to the dates shown
in the table in case of death or termination of employment. The purchase
price for stock on the exercise of options may be paid in cash or in shares
of the Corporation's Common Stock already owned by the option holder, or by
a combination thereof. In the event of a change in control of the
Corporation, all of the options shown in the table will immediately become
exercisable.
(2) Non-qualified options. Vest on 10/19/2000, 10/19/2001, 10/19/2002; except
Mr. Ingulli's which vest on 10/19/2000 and 10/19/2001.
(3) Incentive Stock options. All vest on 10/19/2002
13
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
VALUE OF UNEXERCISED
NUMBER OF SECURITIES IN-THE-MONEY OPTIONS
UNDERLYING UNEXERCISED AT FY-END($)
OPTIONS AT FY-END(#) 12/31/99--FMV $13.53125
-------------------------------------- ---------------------------
SHARES VALUE
ACQUIRED ON REALIZED
NAME EXERCISE (#) ($)(2) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ------------ -------- ----------- ------------- ----------- -------------
V.A. Calarco(1)................... 100,000 289,000 1,142,262 1,125,000 $435,012 $4,150,000
C.J. Marsden(1)................... 9,413 25,733 209,825 277,500 52,871 1,037,500
A.F. Ingulli...................... -- -- 361,230 165,000 690,666 518,750
W.A. Stephenson................... -- -- 196,293 160,000 205,278 518,750
J.B. Eisenberg.................... -- -- 242,485 260,000 307,244 1,037,500
- ------------------------
(1) All numbers reflect the 2-for-1 stock split on May 22, 1992.
(2) Fair market value at date of exercise less exercise price.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Headrick and Hohn served as members and Mr. Bitonti served as
Chairman of the Organization, Compensation and Governance Committee of the Board
during the last completed fiscal year. Messrs. Fox and Headrick served as
members and Mr. Bitonti served as Chairman of the Executive Compensation
Committee of Crompton & Knowles during the last completed fiscal year prior to
the merger with Witco. No member of the Organization, Compensation and
Governance Committee is a current or former officer or employee of the
Corporation or any of its subsidiaries.
RETIREMENT PLANS
Each of the persons shown in the Summary Compensation Table on page 12 is
covered by a supplemental retirement agreement with the Corporation. In the case
of Messrs. Calarco and Marsden, the executive's total annual benefit payable
under the supplemental retirement agreement to the executive for life will be
60% and 50%, respectively, of the average total compensation (including salary
and bonus) paid to the executive during the highest five years of the last ten
years prior to the executive's normal retirement age. In the case of
Messrs. Ingulli, Stephenson and Eisenberg, the executive's retirement benefits
under each supplemental agreement supplement the benefit paid to the executive
under a Uniroyal Chemical Company, Inc. ("Uniroyal") defined benefit pension
plan so that the total annual benefit payable to the executive will be 55% of
the average total compensation (including salary and bonus) paid to the
executive during the highest five years of the last ten years prior to the
executive's retirement or, at his election, Mr. Ingulli may receive a lump sum
payment earned under a previous supplemental retirement agreement with Uniroyal.
A supplemental benefit in a reduced amount may be payable in the event of
termination of employment prior to normal retirement age. At any time after the
date on which benefit payments commence, the executive may elect to receive a
single lump sum equal to 90% of the actuarial equivalent of the benefit
otherwise payable to the executive. An executive may elect to have the
executive's supplemental benefit under the agreement paid in a form which will
provide for the continuation of benefits, to a beneficiary selected by the
executive, upon the executive's death after retirement. Each agreement also
provides for the payment of a reduced benefit to the executive's beneficiary in
the event of the executive's death prior to normal retirement age and for the
payment of disability benefits in addition to those available under the
Corporation's regular disability insurance program. Benefits under each
agreement are not payable if the executive voluntarily terminates the
14
executive's employment, unless such termination is the result of the executive's
retirement (in the case of Messrs. Calarco, and Marsden, on or after reaching
age 62) or is with approval of the Board, and meets certain other conditions set
forth in the agreement.
The following table sets forth the estimated aggregate annual benefit
payable to each of the executives named in the table under the executive's
supplemental retirement agreement from Uniroyal's defined benefit pension plan
and, upon retirement at or after normal retirement age based on each executive's
compensation history to date and assuming payment of such benefit in the form of
a life annuity:
ESTIMATED ANNUAL
NAME OF INDIVIDUAL RETIREMENT BENEFIT
- ------------------ ------------------
Vincent A. Calarco.......................................... $769,550
Charles J. Marsden.......................................... 213,333
Alfred F. Ingulli........................................... 220,651
William A. Stephenson....................................... 198,549
Joseph B. Eisenberg......................................... 202,189
EMPLOYMENT AGREEMENTS
Mr. Calarco is employed pursuant to an employment agreement which was
amended and restated in May 1999. The agreement provides for Mr. Calarco's
employment as President and Chief Executive Officer for a term of three years,
with automatic annual one-year extensions of the term unless the Corporation
gives notice at least 60 days prior to the anniversary of the date of the
agreement that the term will not be extended. The amended agreement calls for a
base salary of not less than $750,000 and for Mr. Calarco's continued
participation in employee benefit plans and other fringe benefit arrangements
substantially as in the past. In the event Mr. Calarco's employment is
terminated by the Corporation other than for cause, disability, or death or by
Mr. Calarco for good reason (as defined in the agreement), the Corporation is
obligated to pay Mr. Calarco his salary to the date of termination, incentive
compensation in an amount no less than the bonus paid to him for the prior year
pro-rated to that date, and a lump sum termination payment equal to three times
the sum of his then current salary and the highest bonus paid to him during the
three years preceding his termination, to continue certain employee benefits
provided under the agreement for a period of three years or until he obtains
other employment and certain other benefits for the life of Mr. Calarco and his
spouse, and to make certain additional payments to cover any excise tax imposed
under the Internal Revenue Code on the amounts payable as a result of his
termination and any legal fees incurred by Mr. Calarco in enforcing the
Corporation's obligations under the agreement.
The Corporation has entered into employment agreements with certain other
key management employees, including Messrs. Marsden, Ingulli, Stephenson and
Eisenberg. Each agreement is operative upon the occurrence of a change in
control (as defined in the agreement) and is intended to encourage the executive
to remain in the employ of the Corporation by providing the executive with
greater security. Absent a change in control, the agreements do not require the
Corporation to retain the executive or to pay the executive any specified level
of compensation or benefits except that Messrs. Ingulli, Stephenson and
Eisenberg have agreements that require that they be paid severance payments in
the event that they are terminated without cause or they resign for good reason
(as defined in the agreements) during an annually renewable two-year period. In
the event of a change in control, the agreements provide that there will be no
change, without the executive's consent, in the salary, bonus opportunity,
benefits, duties, and location of employment of the executive for a period of
two or three years after the change in control. If, during such period, the
executive's employment is terminated by the Corporation other than for cause,
disability, or death or the executive resigns for good reason (as defined in the
agreements), the Corporation will pay the executive his salary to the date of
termination, incentive compensation in an amount no less than the bonus paid to
the executive
15
for the prior year pro-rated to that date, and a lump sum severance payment
equal to two or three times (depending on the executive) the sum of the
executive's base salary and the highest bonus paid to the executive during the
three years preceding the executive's termination and will continue other
employee benefits similar to those provided to the executive prior to the
executive's termination for a period of two or three years or until the
executive's earlier employment with another employer.
APPROVAL OF AN AMENDMENT TO THE RESTATED CERTIFICATE OF INCORPORATION
TO CHANGE THE NAME OF THE CORPORATION
On January 25, 2000, the Board of Directors unanimously adopted a resolution
authorizing an amendment to the Corporation's Restated Certificate of
Incorporation (the "Certificate") changing the name of the Corporation to
"Crompton Corporation." The Board also recommended that the proposed amendment
be submitted to the Corporation's stockholders for consideration and approval at
the annual meeting.
If the proposal to change the name of the Corporation is approved by the
stockholders, Article 1 of the Certificate will be amended to read in its
entirety as follows:
"1. The name of the Corporation is Crompton Corporation."
The Board of Directors believes that it is in the best interests of the
Corporation and its stockholders to change the Corporation's name. The
Corporation was created on September 1, 1999 upon the merger of Crompton &
Knowles and Witco, both producers and marketers of specialty chemicals serving
diverse global industrial markets. The Corporation's name was an abbreviated
combination of both names.
Upon conducting a research study analyzing the corporate identity attributes
of the Corporation among its customers, the investment community and members of
the chemical industry, management determined that the name CK Witco did not
represent the new company's most desired attributes. As a result, management
recommended to the Board of Directors that the Corporation's name be changed
from CK Witco Corporation to Crompton Corporation. Having built considerable
equity in the Crompton brand name through consistent customer satisfaction,
reliable technical service and dependable financial performance--all key
elements for success in the specialty chemical industry--management and the
Board of Directors believe that the Crompton name better reflects the strengths
of the Corporation. Overall, management and the Board of Directors believe the
change of the Corporation's name will enhance the Corporation's recognition
among its customers, members of the investment community and its peers in the
chemical industry.
The name change will not affect the validity or transferability of currently
outstanding stock certificates, and stockholders will not be requested to
surrender for exchange any certificates presently held by them. If the
stockholders approve the name change, the Corporation intends to change the
symbol for the Corporation's Common Stock on the New York Stock Exchange, Inc.
from "CNW" to "CK".
If the proposal is approved, the change of the Corporation's name will
become effective upon the filing of a Certificate of Amendment to the Restated
Certificate of Incorporation with the Secretary of State of the State of
Delaware. It is anticipated that officers of the Corporation will promptly make
appropriate filings in the State of Delaware and take any other actions
necessary to implement the Amendment; however, if in the judgment of the Board
of Directors, any circumstances exist that would make consummation of the name
change inadvisable, then, in accordance with Delaware law and notwithstanding
approval of the proposed amendment by the stockholders, the Board of Directors
may abandon the name change, either before or after approval and authorization
of the proposed amendment by the stockholders, at any time prior to the
effectiveness of the filing of the Certificate of Amendment.
16
Under Delaware law, stockholders are not entitled to appraisal rights with
respect to the proposed change of the Corporation's name.
The Board of Directors recommends a vote for approval, and unless otherwise
directed, proxies will be voted in favor of this selection. The affirmative vote
of the holders of a majority of the shares of the Corporation outstanding and
entitled to vote at the meeting is required for such approval.
APPROVAL OF SELECTION OF INDEPENDENT AUDITOR
The Board of Directors has, subject to approval by the stockholders,
selected the firm of KPMG LLP, which had been the auditor of Crompton & Knowles
for many years and for the Corporation for fiscal year 1999, to act as auditor
of the Corporation for the fiscal year 2000 and to perform other appropriate
accounting services. The Board of Directors recommends a vote for approval, and
unless otherwise directed, proxies will be voted in favor of this selection. The
affirmative vote of the holders of a majority of the shares of the Corporation
represented and entitled to vote at the meeting is required for such approval.
The Corporation has been advised that representatives of KPMG LLP will be
present at the annual meeting, with the opportunity to make a statement if they
desire to do so and to respond to appropriate questions raised at the meeting.
STOCKHOLDER PROPOSALS
Under rules of the Securities and Exchange Commission, any proposal of a
stockholder which is intended to be presented for action at the annual meeting
of the stockholders to be held in 2001 must be received by the Corporation at
its principal executive offices by November 27, 2000, in order to be considered
for inclusion in the Proxy Statement and form of proxy relating to the 2001
meeting.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Corporation's officers and
directors and persons who own more than ten percent of a registered class of the
Corporation's equity securities to file reports of ownership and changes in
ownership with the Securities and Exchange Commission and the New York Stock
Exchange. Officers, directors and greater than ten percent stockholders are
required by SEC regulations to furnish the Corporation with copies of all
Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Corporation believes that during fiscal year
1999, all filings required of its officers, directors and greater than ten
percent beneficial owners were made in compliance with applicable SEC
regulations, except for two Form 4 filings pertaining to two gifts by
Mr. Calarco of the Corporation's Common Stock during prior fiscal years.
OTHER MATTERS
As of the date of this statement, the Board of Directors does not know of
any matter other than those referred to in this Proxy Statement as to which
action is expected to be taken at the annual meeting of stockholders.
The affirmative vote of the holders of a plurality of the shares which are
present in person or represented by proxy at the meeting is required to elect
directors; the affirmative vote of the holders of a majority of the shares
outstanding and entitled to vote at the meeting is required to change the name
of the corporation; and the affirmative vote of the holders of a majority of the
shares which are present in person or represented by proxy is required to
approve all other matters listed in the notice of meeting. Proxies which are
marked "abstain" on the proposals to be voted upon at the meeting will be
17
counted for the purpose of determining the number of shares represented in
person and by proxy at the meeting. Such proxies will thus have the same effect
as if the shares represented thereby were voted against the matters to be
considered at the meeting. Shares not voted on any such matter on proxies
returned by brokers will be treated as not represented at the meeting as to such
matter.
The shares represented by proxies in the form solicited by the Board of
Directors will be voted at the meeting. Where a choice is specified on the proxy
with respect to a matter to be voted upon, the shares represented by the proxy
will be voted in accordance with the specification so made. If no choice is
specified, such shares will be voted for (i) the election as directors of the
eight nominees for directorships named herein, (ii) in favor of approval of the
change of name of the Corporation, and (iii) in favor of the selection of KPMG
LLP as auditor for fiscal year 2000.
If any business not referred to in this Proxy Statement shall properly come
before the meeting, it is intended that those persons named as proxies will vote
the proxies in accordance with their judgment of the best interests of the
Corporation and its stockholders.
The cost of solicitation will be borne by the Corporation. In addition to
solicitation by mail, the management of the Corporation may solicit proxies
personally or by telephone and has retained the firm of ChaseMellon Shareholder
Services L.L.C. to assist in such solicitation at a fee of $4,500 plus expenses.
The Corporation may also request brokerage firms and other nominees or
fiduciaries to forward copies of its proxy material to beneficial owners of
stock held in their names, and the Corporation may also reimburse such persons
for reasonable out-of-pocket expenses incurred by them in connection therewith.
By Order of the Board of Directors,
/s/ John T. Ferguson II
JOHN T. FERGUSON II
Secretary
Dated: March 30, 2000
18
[PROXY CARD]
CK WITCO CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS
For Annual Meeting on April 25, 2000, at the Sheraton Stamford Hotel, 2701
Summer Street, Stamford, Connecticut, 11:15 A.M.
The undersigned appoints VINCENT A. CALARCO AND JOHN T. FERGUSON II or either of
them, with power of substitution, proxy and attorney for the undersigned to vote
all shares of stock of CK Witco Corporation that the undersigned is entitled to
vote at the Annual Meeting of the Stockholders of said Corporation to be held on
Tuesday, April 25, 2000, at 11:15 a.m. and any adjournments thereof, with all
powers the undersigned would have if present, upon the proposals set forth on
the reverse side and in their discretion on all matters properly coming before
the meeting, including those described in the Notice and Proxy Statement
thereof, receipt of which is acknowledged.
This Proxy will be voted as directed, or where no direction is given, will be
voted "FOR" Proposals Nos. 1, 2 and 3. If any nominee for the Board of Directors
named in the Proxy Statement is unavailable to serve, this Proxy will be voted
for such substitute nominee as may be recommended by the Board of Directors. The
Board of Directors is not aware of other matters to come before the meeting.
CONTINUED, AND TO BE VOTED, SIGNED AND DATED ON THE REVERSE SIDE
CK WITCO CORPORATION Please mark X
your vote as
indicated in
this example
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 1.
1. Election of directors: Vincent A. Calarco, Roger L. Headrick and Patricia K.
Woolf, Ph.D. to serve as Class III for a term expiring in 2003; Robert A. Fox
and Harry G. Hohn to serve as Class II directors for a term expiring in 2002;
Leo I. Higdon, Jr., C.A. Piccolo and Bruce F. Wesson to serve as Class I
directors for a term expiring in 2001.
FOR ALL NOMINEES WITHHOLD AUTHORITY
with exceptions noted FOR ALL NOMINEES
(To withhold authority to vote for any individual nominee, write that nominee's
name in the space provided below)
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 2.
2. Approval of the recommendation to amend and restate the Certificate of
Incorporation to change the name of the Corporation to Crompton Corporation.
FOR AGAINST ABSTAIN
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 3.
3. Approval of the selection by the Board of KPMG LLP as independent auditors
for 2000.
FOR AGAINST ABSTAIN
Dated: , 2000
SIGNATURE(S) OF STOCKHOLDER(S)
Note: Signature should agree with name stenciled hereon. When signing as
executor, administrator, trustee, or attorney, please give full title as such.
For joint accounts or co-fiduciaries, all joint owners or co-fiduciaries should
sign.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.