SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant X
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
Calgon Carbon Corporation
(Name of Registrant as Specified in its Charter)
Joseph A. Fischette, Esq.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(l)(ii), 14a-6(i)(l), or 14a-6(j)(2).
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
[_] 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.
[LOGO OF CALGON CARBON CORPORATION]
CALGON CORPORATION
P.O. BOX 717
PITTSBURGH, PA 15230-0717
(412) 787-6700
TELEX 671 1837 CCC PGH
PANAFAX: 412-787-6713
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of Calgon
Carbon Corporation at 1:00 p.m., Eastern Daylight Saving Time, on Tuesday, April
19, 1994 at the principal executive office of the Company, 400 Calgon Carbon
Drive, Pittsburgh, Pennsylvania.
Information about the business of the meeting and the nominees for election as
directors is set forth in the notice of the meeting and the Proxy Statement,
which are attached. This year you are asked to elect three directors and to
elect independent auditors for 1994.
It is important that your shares be represented at the meeting. Even if you plan
to attend the meeting in person, we hope that you will send in a proxy voting on
the matters to be considered. Please sign, date and return your proxy in the
enclosed envelope as promptly as possible.
Very truly yours,
/s/ THOMAS A. MCCONOMY
----------------------
Thomas A. McConomy
President
March 17, 1994
CALGON CARBON CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of Calgon Carbon Corporation will be held at
the principal executive office of the Company, 400 Calgon Carbon Drive,
Pittsburgh, Pennsylvania, on Tuesday, April 19, 1994 at 1:00 p.m., Eastern
Daylight Saving Time, for the following purposes:
(1) To elect three directors;
(2 To elect independent auditors to examine the consolidated financial
statements of the Company for 1994; and
(3) To transact such other business as may properly come before the
meeting.
Please refer to the accompanying Proxy Statement for a description of the
matters to be considered at the meeting.
Holders of record of the Company's Common Stock and Class A Stock as of the
close of business on March 1, 1994 are entitled to notice of and to vote at the
meeting.
Please sign, date and return the enclosed proxy promptly in the envelope
provided, which requires no United States postage.
Joseph A. Fischette
Secretary
March 17, 1994
CALGON CARBON CORPORATION
PROXY STATEMENT
Table of Contents
Page
----
Voting Securities and Record Date............................................................................ 1
Security Ownership of Certain Beneficial Owners and Management............................................... 1
Board of Directors and Committees of the Board............................................................... 3
Election of Directors........................................................................................ 4
Executive Compensation....................................................................................... 6
Election of Independent Auditors............................................................................. 12
Vote Required................................................................................................ 12
Other Business............................................................................................... 13
Stockholder Proposals........................................................................................ 13
CALGON CARBON CORPORATION
PROXY STATEMENT
Annual Meeting of Stockholders
April 19, 1994
The enclosed proxy is solicited on behalf of the Board of Directors of Calgon
Carbon Corporation (the "Company") for use at the Annual Meeting of Stockholders
to be held at 1:00 p.m., Eastern Daylight Saving Time, on Tuesday, April 19,
1994 at the principal executive office of the Company, 400 Calgon Carbon Drive,
Pittsburgh, Pennsylvania. The accompanying Notice of Annual Meeting of
Stockholders sets forth the purposes of the meeting.
The enclosed proxy may be revoked at any time before its exercise by giving
written notice of revocation to the Secretary of the Company. The shares
represented by proxies in the form solicited by the Board of Directors will be
voted at the meeting. If 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 that specification. If no choice is specified, the shares will
be voted as stated below in this Proxy Statement.
It is expected that this Proxy Statement and the accompanying form of proxy will
first be mailed to stockholders on or about March 17, 1994. The Company's Annual
Report to Stockholders for 1993 is enclosed with this Proxy Statement but does
not form a part of the proxy soliciting material. The cost of soliciting proxies
will be borne by the Company. Following the original mailing of the proxy
soliciting material, regular employees of the Company may solicit proxies by
mail, telephone, telecopy, telegraph and personal interview. The Company may
also request brokerage houses and other nominees or fiduciaries to forward
copies of the proxy soliciting material and 1993 Annual Report to beneficial
owners of the stock held in their names, and the Company will reimburse them for
reasonable out-of-pocket expenses incurred in doing so.
VOTING SECURITIES AND RECORD DATE
Holders of the Company's Common Stock and Class A Stock of record as of the
close of business on March 1, 1994 are entitled to receive notice of and to vote
at the meeting. At the record date, the Company had outstanding 28,879,252
shares of Common Stock, the holders of which are entitled to one vote per share,
and 12,148,508 shares of Class A Stock, the holder of which is entitled to ten
votes per share. The Company does not have cumulative voting. Accordingly, as of
the record date the holder of the Class A Stock is entitled to cast 81% of all
the votes entitled to be cast at the meeting, and the holders of the Common
Stock are entitled to cast 19% of such votes. All of the Class A Stock is held
in a voting trust of which Thomas A. McConomy is the voting trustee. Mr.
McConomy intends to vote all the Class A Stock in favor of the election of
Messrs. Bailey, Tisch and Zanitsch as directors and in favor of the election of
Price Waterhouse to audit the Company's consolidated financial statements for
1994.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows the number of shares of Class A Stock and Common Stock
beneficially owned by each director of the Company, by Clayton P. Shannon, an
executive officer of the Company, and by all directors and executive officers of
the Company as a group, as of the record date. Unless otherwise indicated in the
footnotes to the table, each person named and all directors and officers as a
1
group have sole voting power and sole investment power with respect to the
shares. Management of the Company does not know of any other person who
beneficially owned as of the record date more than five percent of any class of
the Company's voting securities. As used herein, "beneficial ownership" means
the sole or shared power to vote, or to direct the voting of, a security, or the
sole or shared investment power with respect to a security (i.e., the power to
dispose of, or to direct the disposition of, the security). A person is deemed
to have "beneficial ownership" of any security that the person has the right to
acquire within 60 days after the record date.
Amount and Amount and
nature of Percent of nature of Percent of
beneficial class of beneficial class of
Name of ownership of Class A ownership of Common
beneficial owner Class A Stock(1) Stock Common Stock Stock
---------------- ---------------- ---------- ------------ ----------
Colin Bailey 1,864,424 15.3% 20,000 *
Robert W. Cruickshank 0 0 6,000 *
William J. Gilliam 0 0 441,750 1.5%
Arthur L. Goeschel 0 0 500 *
Thomas A. McConomy 5,019,660 41.3 68,820 *
Nick H. Prater 0 0 2,000 *
Ronald R. Tisch 1,800,000 14.8 57,424 *
Harry H. Weil(2) 0 0 3,600 *
Roger H. Zanitsch(3) 1,800,000 14.8 44,934 *
Clayton P. Shannon(4) 0 0 201,276 *
All directors and executive
officers as
a group (13 persons)
(2)(3)(4)(5) 10,484,084 86.3 1,131,472 3.9
- ---------
*Less than 1%.
(1) All the outstanding Class A Stock is held in a voting trust of which Thomas
A. McConomy is the sole voting trustee. Mr. McConomy has sole power to vote
shares in his discretion for every purpose, without any requirement that he
consult with or obtain the consent of the persons who deposited such shares
in the voting trust. None of such shares may be withdrawn from the voting
trust except with the consent of (i) the voting trustee and (ii) a majority
of interest of the persons with shares deposited in the voting trust other
than the person seeking withdrawal. Upon any withdrawal, the Class A shares
withdrawn will automatically be converted into an equal number of shares of
Common Stock. The voting trust presently expires on the earlier of March 1,
1995 or the first date when the number of shares of Class A Stock
outstanding is less than 15% of the total number of shares of Class A Stock
and Common Stock outstanding. Mr. McConomy's address as voting trustee is
P.O. Box 717, Pittsburgh, Pennsylvania 15230.
(2) Includes 200 shares held by Mr. Weil's wife, as to which beneficial
ownership is disclaimed by
Mr. Weil.
(3) Includes 6,400 shares held by the Zanitsch Charitable Foundation, a trust
established in 1988 to fund charitable works, as to which beneficial
ownership is disclaimed by Mr. Zanitsch.
2
(4) Includes 10,306 shares in the case of Mr. Shannon, and 35,174 shares in the
case of all directors and executive officers as a group, held under the
Company's Employee Growth Participation Plan and allocated to the accounts
of such executive officers. That plan was terminated in 1990.
(5) Includes 12,800 shares, in the case of all directors and executive officers
as a group, covered by presently exercisable stock options granted under
the Company's Stock Option Plan. The "percent of class" set forth above for
the group (but not of others listed above) is computed as though such
shares optioned to the group were outstanding.
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The business of the Company is under the general supervision of a Board of
Directors as provided by the laws of Delaware, the Company's state of
incorporation. The Board of Directors has established committees to assist it,
consisting of the Executive Committee, the Compensation Committee, the Audit
Committee, the Nominating Committee and the Pension Committee.
Executive Committee. The Executive Committee consists of Messrs. McConomy
(Chairman), Bailey, Goeschel, Prater and Weil. The Executive Committee, during
the intervals between meetings of the Board, may exercise all the powers and
authority of the Board of Directors in the management of the business and
affairs of the Company.
Compensation Committee. The Compensation Committee consists of Messrs.
Cruickshank (Chairman), Gilliam, Goeschel and Prater. The Compensation Committee
determines the salaries payable to all executive officers. The Committee also
determines bonuses, if any, to be paid each year to officers and key employees.
The Committee also administers the Company's stock option plan and has the
authority to grant options thereunder.
Audit Committee. The Audit Committee consists of Messrs. Weil (Chairman),
Cruickshank and Gilliam. The responsibilities of the Audit Committee are to (i)
provide assistance to the Board of Directors in fulfilling its statutory and
fiduciary responsibilities for examinations of the Company and in monitoring its
accounting and financial reporting practices; (ii) determine that the Company
has adequate administrative, operational and internal accounting controls and
that the Company is operating in accordance with its prescribed procedures and
codes of conduct; (iii) serve as an independent and objective party in the
review of the financial information presented by management for distribution to
stockholders and the general public; and (iv) provide direction and supervision
over the internal audit function and the independent accountants. One of the
functions of the Audit Committee is to recommend to the Board of Directors the
selection of independent accountants for the coming year.
Nominating Committee. The Nominating Committee consists of Messrs. Bailey
(Chairman), McConomy, Tisch and Zanitsch. The Nominating Committee reviews the
size and composition of the Board of Directors and makes recommendations with
respect to nominations for election or appointment of directors. The
Nominating Committee will consider nominees recommended by stockholders
provided that stockholders submit the names of nominees in writing to the
Secretary of the Company together with a statement of the nominees'
qualifications. Such information should be received no later than January 31,
1995 with respect to nominations for election at the 1995 Annual Meeting of
Stockholders.
Pension Committee. The Pension Committee consists of Messrs. Cruickshank and
Prater (Co-Chairmen), Tisch and Zanitsch. The Pension Committee reviews and
approves the investments of the Company's defined benefit pension plans and
interacts with the investment manager for such plans.
3
During 1993, the Executive Committee held one meeting, the Compensation
Committee held three meetings, the Audit Committee held two meetings, the
Nominating Committee held one meeting and the Pension Committee held three
meetings. The Board of Directors held eight meetings during 1993.
Compensation of Directors
Board and Committee Fees. Directors who are full-time employees of the Company
or a subsidiary receive no additional compensation for services as a member of
the Board or any committee of the Board. Directors who are not employees of the
Company receive an annual retainer of $12,000 for Board service and a fee of
$750 for each Board and committee meeting attended, other than committee
meetings held by telephone or on the same day as a Board meeting.
1993 Non-employee Directors' Stock Option Plan. The 1993 Non-employee Directors'
Stock Option Plan provides for an annual grant of non-statutory stock options to
each non-employee Director in an amount equal to the sum of 500 plus 100 times
the number of calendar years during which, as of April 1 of such year, such
person was a non-employee Director of the Company. The option price for each
stock option is $15.50, the fair market value of the Common Stock on April 21,
1993, the date of the first grant. In general, stock options will vest if the
"income from operations" of the Company for the fiscal year in which such
options were granted is greater than that of the prior fiscal year; otherwise
such stock options will be forfeited. The 1993 options granted to directors were
forfeited.
ELECTION OF DIRECTORS
The Board of Directors, acting pursuant to the bylaws of the Company, has
determined that the number of directors constituting the full Board of Directors
shall be nine at the present time. The Board is divided into three classes of
equal size. One such class is elected every year at the Annual Meeting for a
term of three years.
The Board of Directors has, upon recommendation of the Nominating Committee,
nominated Colin Bailey, Ronald R. Tisch and Roger H. Zanitsch for reelection as
directors, and each of them has agreed to serve if elected. Each director
elected at the 1994 Annual Meeting of Stockholders will hold office until the
1997 Annual Meeting of Stockholders or until the director's prior death,
disability, resignation or removal. Proxies are solicited in favor of those
nominees and will be voted for them unless otherwise specified. All nominees
have served as directors since the formation of the Company in 1985. If any
nominee becomes unable or unwilling to serve as a director, it is intended that
the proxies will be voted for the election of such other person, if any, as
shall be designated by the Board of Directors.
Information concerning those nominees for director and the other directors who
will continue in office after the meeting is set forth below, together with
information concerning the Company's executive officers who are not directors.
Name Age Position with the Company
- ---- --- -------------------------
Class of 1997
Colin Bailey 47 Executive Vice President, Director
Ronald R. Tisch 52 Senior Vice President, Director
Roger H. Zanitsch 50 Senior Vice President, Director
4
Name Age Position with the Company
- ---- --- -------------------------
Class of 1995
Robert W. Cruickshank 48 Director
Arthur L. Goeschel 72 Director
Thomas A. McConomy 60 President, Director
Class of 1996
William J. Gilliam 41 Director
Nick H. Prater 65 Director
Harry H. Weil 60 Director
Executive Officers
Clayton P. Shannon 59 Senior Vice President--Finance
Joseph A. Fischette 47 Vice President, General Counsel
and Secretary
Robert V. Carrubba 57 Vice President
John M. MacCrum 46 Vice President
Messrs. McConomy, Bailey, Tisch and Zanitsch have been directors and executive
officers of the Company since its formation in 1985. Messrs. Fischette and
Shannon have been executive officers of the Company, and Dr. Carrubba and Mr.
MacCrum have been key employees or executive officers of the Company, since
1985. Mr. McConomy is also a director of PNC Bank and Equitable Resources, Inc.
Mr. Cruickshank has been a director of the Company since November 1985. Mr.
Cruickshank has been Chairman of the Board of Wiltek, Inc. and a private
investor for more than the past five years. He is also a director of New Canaan
Bank & Trust Company and Friedmans, Inc.
Mr. Gilliam has been a director of the Company since its formation in 1985. From
August 1987 to mid-1988, Mr. Gilliam was a partner of Gilliam Joseph &
Littlejohn, a merchant banking partnership. Since January 1989, Mr. Gilliam has
been President and Chief Executive Officer of Gilliam & Company, Inc., a
merchant banking firm. Since December 1990, Mr. Gilliam has been Chairman and
Chief Executive Officer of New Charleston Capital, Inc., a merchant banking
firm. From April 1988 to March 1992, Mr. Gilliam was Chairman of the Board and
Chief Executive Officer of Rexene Corporation.
Mr. Goeschel has been a director of the Company since its formation in 1985. In
1992 Mr. Goeschel, previously retired, became Chairman of the Board of Rexene
Corporation, a manufacturer of polypropylene and other thermoplastic and
petrochemical products. He also was Chairman of the Board of Tetra Technologies,
Inc., which manufactures water treatment equipment, from 1992 until October
1993. Mr. Goeschel is also a director of the Laurel Mutual Funds.
Mr. Prater has been a director of the Company since August 1990. Until June
1990, when he retired, Mr. Prater was President and Chief Executive Officer of
Mobay Corporation (now called Miles, Inc.), a chemical producer.
Mr. Weil has been a director of the Company since its formation in 1985. Mr.
Weil is a partner in the law firm of Reed Smith Shaw & McClay, which provides
legal services to the Company.
5
EXECUTIVE COMPENSATION
In 1985 the Board of Directors created a Compensation Committee, consisting of
at least three directors who are not employees of the Company. One of the
functions of the Compensation Committee is to review at least annually, and more
often if circumstances make an interim review appropriate, the compensation of
the Company's executive officers and the plans or formulas from which such
compensation is derived. The Compensation Committee then makes recommendations
to the full Board of Directors as to such matters (except for the grant of
options under the Company's Stock Option Plan, which is done by the Committee
alone so that the grants will satisfy Rule 16b-3 under the Securities Exchange
Act of 1934).
Set forth below is the report of the members of the Compensation Committee,
Messrs. Cruickshank (Chairman), Gilliam, Goeschel and Prater, as to the
Committee's recommendations for the compensation of the Company's executive
officers applicable to 1993.
Compensation Committee Report on Executive Compensation
General policies with respect to executive compensation
and the relationship between compensation and performance
---------------------------------------------------------
The Compensation Committee's policies with respect to executive compensation are
intended to achieve three principal goals. First, they are intended to create
base compensation levels sufficient to attract and retain talented and dedicated
executive officers. To accomplish this, the Committee compares the Company's
base salary levels with those currently being paid for similar positions by
other companies. The Committee also reviews the total compensation package
available to executive officers, to make sure it remains competitive.
Second, the compensation policies are intended to provide a direct link between
performance during the year (both the performance of the Company as a whole and
the performance of the individual officer) and a significant part of the
officer's compensation. This is done through cash bonuses available to executive
officers based on the Company's performance as a whole and the officer's
performance as an individual. During the past five years these bonuses have
ranged from a high of 100% of salary to a low of zero.
Third, the compensation policies are intended to provide executive officers with
the opportunity to acquire a significant equity stake in the Company, through
granting them stock options at full market prices and with delayed vesting
provisions. These options will become and remain important assets if, and only
if, the market price of the Common Stock increases over the period of the
options. Short-term price fluctuations up and down will not be as important to
optionees as long-term growth. In this respect, therefore, the interests of the
executive officers will be aligned directly with the interests of the
stockholders in increasing stockholder value.
Compensation policies applied to executive officers in 1993
-----------------------------------------------------------
The Company's executive officers are Messrs. McConomy, Bailey, Tisch, Zanitsch,
Shannon, Fischette, MacCrum and Carrubba. Their compensation has three main
components: base salary, bonus, and stock options.
Salary. Base salaries for the executive officers are designed to be at levels at
or slightly lower than those of executive officers of comparable companies under
the so-called "Hay point" system. This system was designed some years ago by The
Hay Group, Inc., an independent salary consulting firm, and it has been adopted
in various forms by many companies. The Hay Group provides a comparison to the
6
Company's compensation with all companies participating in the Hay system, and
with those companies in the Company's same industry sector. Under this system, a
certain number of "Hay points" is assigned to each executive position, depending
on factors such as the relative importance of the executive's functions to the
overall results of the Company, the number of employees reporting to the
executive, the levels of supervision, if any, over the executive, and similar
factors. Once established, the number of Hay points applicable to a particular
position is unlikely to change unless there is a significant change in the
duties and responsibilities associated with that position.
In associating particular levels of salary with particular numbers of Hay
points, the Compensation Committee is guided primarily by information from The
Hay Group, Inc. and other sources as to competitive salaries. The other
companies compared with the Company for this purpose are selected by The Hay
Group, Inc., not by the Company, and are not necessarily the same as those used
for the Performance Graph in the Proxy Statement. The Committee also considers
the present and projected cash position of the Company, and the availability to
the executive officers of additional forms of compensation described below. This
consideration is done subjectively and not on any formula or objective basis.
The Committee's general philosophy is that salary levels for the Company's
executive officers should be somewhat less than the median salaries paid by
other companies for comparable positions, so that the overall compensation of an
executive officer in a particular year will be more heavily weighted towards
incentive compensation, such as bonus and stock options, than towards a fixed
salary. In this way, the executive officer's compensation will vary from year to
year and will be strongly influenced by the results achieved by the Company.
Salaries for executive officers have not been generally increased since early
1991. However, increases in the salaries of Messrs. Bailey and MacCrum, to
reflect Mr. Bailey's promotion to Executive Vice President and Chief Operating
Officer and Mr. MacCrum's promotion to Vice President--Sales and Marketing, were
effective January 1, 1993. There were no other changes in executive officer
salaries for 1993. For 1994 the Committee recommended, and the Board of
Directors approved, 8% increases in the salaries of Messrs. Carrubba, Fischette,
MacCrum and Shannon. The salaries of Messrs. McConomy, Bailey, Tisch and
Zanitsch were not increased.
Bonus. Since 1985 the Company has maintained an Officers Incentive Plan under
which cash bonuses may be granted to its executive officers and others. The
total amount of bonuses that may be awarded under the Plan (the "bonus pool")
cannot exceed 100% of the annualized salaries of all the participants, measured
at year-end. The 100% level is available only if the Company's actual cash flow
for the year is 120% or more of the cash flow forecast at the beginning of the
year in the Company's business plan. Lower levels of cash flow result in a
smaller bonus pool, until if the actual cash flow is less than 70% of forecasted
cash flow, there is no bonus pool at all. Cash flow is defined for purposes of
the Plan as net income plus depreciation charges; unusual items may or may not
be included, as determined by the Committee. The business plan for 1993 was
developed by the Company's management at the end of 1992, after extensive
analysis and consultation with managers of the Company's business units, and was
ultimately adopted by the Board of Directors in late 1992. This is the normal
procedure used by the Company to formulate its business plan. Calculations based
upon the foregoing resulted in no bonus pool being available for 1993, so no
bonuses for 1993 were granted to executive officers.
The Committee has recommended, and the Board of Directors has approved,
termination of the Officers Incentive Plan and its replacement by a new Officer
Incentive Plan effective January 1, 1994. The new plan also makes a bonus pool
available from which cash bonuses may be granted to executive officers, but
under revised criteria. It is not possible to predict whether any bonuses will
be granted under the new plan after 1994 is completed.
7
Stock options. Under the terms of the Company's Stock Option Plan adopted in
1985, the Compensation Committee alone determines the identity of the optionees,
the number of shares to be covered by each option, the years in which the
options will become vested, and other terms and conditions of the options. In
determining whether to grant any options, the Committee takes into account the
number of options already outstanding, the market price of the Company's Common
Stock, the results achieved by the Company in the past year or more (such as
earnings, cash flow, return on equity and other measures), and its prospects
during the next several years. Potential dilution resulting from the exercise of
options in the future is considered, as is the desirability of more closely
linking the rewards of the optionees to increases in the market price of the
stock. These matters are subjective, and are not determined by any formula or
weighting of particular factors. The Committee believes that such a link
provides an additional incentive to achieve results which are valued by the
market, and which thus may benefit stockholders through an increased market
price.
In determining whether to grant options to a particular individual, the
Committee considers, again subjectively, the level of responsibility of the
individual within the Company, the effect which successful efforts by the
individual may have on the overall results of the Company, the need to provide
incentive compensation comparable to that available from other companies which
may compete for the individual's services, and the number of unexercised options
and shares of the Company's Stock already held by the individual. In view of the
fact that many of the executive officers have substantial holdings of Company
stock, the Committee had not, until the grants described below, granted stock
options to its executive officers since 1987 and in general has granted less
stock options to its executive officers than those in its comparative group.
At its meeting in early 1994, the Committee granted the following stock options:
Mr. Bailey 0
Mr. Carrubba 1,950
Mr. Fischette 2,750
Mr. MacCrum 2,600
Mr. McConomy 0
Mr. Shannon 2,800
Mr. Tisch 3,100
Mr. Zanitsch 3,800
The Committee may consider a number of factors in determining whether to grant
stock options, relating to past, present or future events. Notwithstanding this
flexibility, in the case of the grant of the 1994 options, the Committee
intended solely to link the options to the occurrence of future events, and not
to reward any past performance of any individual officers or the officers as a
whole. The Committee reasoned that the Company's past performance did not
necessarily merit the option awards, but that the options would provide a strong
incentive toward improving future performance. This is evidenced by the fact
that the options, which were granted at a time when the price of the Company's
stock was $13 per share, will not be exercisable until January 1, 1995, and will
automatically be cancelled on that date unless the closing market price of the
Company's common stock on December 31, 1994 is $16 or more. If the options are
not cancelled, they may be exercised at any time from January 1, 1995 to
December 31, 1996, at an option price of $13 per share. The viability of the
options is tied solely to a significant increase in stock performance of the
Company in the future.
The number of options granted to the executive officers was determined by the
Committee on a subjective basis but roughly approximated their respective
positions on the Hay point scale and their
8
salary levels. The Stock Option Plan makes stock appreciation rights, payable in
cash, available for grant, but the Compensation Committee has not granted any.
Compensation of the Chief Executive Officer in 1993
---------------------------------------------------
The methods used by the Compensation Committee in fixing Mr. McConomy's
compensation for 1993 were the same as those described above for other executive
officers. As the chief executive officer of the Company, all other officers of
the Company report to him, and he is responsible, directly or indirectly, for
all of the operations and business of the Company. Consequently, Mr. McConomy
has a substantially larger number of "Hay points" assigned to him than any other
officer, and in his case the Committee was guided primarily by the overall
results of the Company in 1993, and less by efforts expended or achievements at
particular tasks or in particular areas.
The number of "Hay points" assigned to Mr. McConomy's position has not changed
in recent years, and his base salary has not been increased since 1991, even
though the salaries paid by other companies to chief executive officers with a
comparable number of Hay points have generally increased. As is the case for all
executive officers of the Company, Mr. McConomy's base salary is at a level with
or slightly lower than those of executive officers of comparable companies. The
Committee did not recommend any change in Mr. McConomy's base salary for 1993,
or any bonus or stock options for him.
The relationship between the Company's performance and Mr. McConomy's
compensation was partly objective and partly subjective: objective in that the
lack of bonus was determined by the relationship between the Company's actual
and forecasted cash flow as summarized above, and subjective in that Committee's
evaluation of the performance of the Company in 1993, which fell below that of
1992 in the key areas of sales, operating profit and stock price, warranted the
continuation of Mr. McConomy's base salary without an increase.
In view of Mr. McConomy's substantial holdings of Company stock, the Committee
has never granted any stock options to Mr. McConomy under the Stock Option Plan.
ROBERT W. CRUICKSHANK WILLIAM J. GILLIAM
ARTHUR L. GOESCHEL NICK H. PRATER
9
Summary Compensation Table
Annual Compensation
---------------------------------------------------
Other Annual All Other
Name and Principal Position Year Salary ($) Bonus ($) Compensation ($) Compensation ($)(1)
- --------------------------- ---- ---------- --------- ---------------- -------------------
Thomas A. McConomy 1993 $303,600 $ 0 $ -- $ 1,681
Director, President and 1992 303,600 80,454 -- 3,222
Chief Executive Officer 1991 295,000 97,759 -- 3,119
Colin Bailey (2) 1993 232,800 0 -- 0
Director, Executive 1992 166,320 78,170 -- 0
Vice President and 1991 173,672 86,154 -- 0
Chief Operating Officer
Ronald R. Tisch 1993 166,320 0 -- 201
Director and 1992 166,320 72,349 -- 839
Senior Vice President 1991 163,800 78,004 -- 1,353
Roger H. Zanitsch 1993 166,320 0 134,177(3) 0
Director and 1992 166,320 49,896 -- 0
Senior Vice President 1991 163,800 53,555 -- 0
C. P. Shannon 1993 150,900 0 -- 553
Senior Vice President--Finance 1992 150,900 60,737 -- 1,390
and Chief Financial Officer 1991 148,610 70,772 -- 1,363
- ---------
(1) Consists only of premiums paid by the Company on term life insurance
policies on the lives of the named individuals.
(2) During 1991 Mr. Bailey was in charge of the Company's international
operations and was resident in Belgium. Portions of his compensation for
those years were paid in Belgian francs. For purposes of the summary
compensation table, such payments have been translated into dollars at
exchange rates in effect at 1991 year-end.
(3) Consists of the costs of personal benefits provided by the Company and its
subsidiaries in connection with Mr. Zanitsch's relocation to England,
including $64,161 for rental allowance and a one-time special relocation
payment of $41,550.
Aggregated Option Exercises in Last Fiscal Year and FY-End Option Values
Number of Securities Value of Unexercised
Shares Underlying Unexercised In-the-Money
Acquired on Options at FY-End (#) Options at FY-End
Exercise Value -------------------------- --------------------------
Name (#) Realized Exercisable Unexercisable Exercisable Unexercisable
- ---- ---------- -------- ----------- ------------- ----------- -------------
Thomas A. McConomy 0 $0 0 0 $0 $0
Colin Bailey 0 $0 0 0 $0 $0
Ronald R. Tisch 0 $0 0 0 $0 $0
Roger H. Zanitsch 0 $0 0 0 $0 $0
C. P. Shannon 53,000 $530,000 0 20,000 $0 $260,000
10
Performance Graph
Comparison of Five-Year Cumulative Total Return*
Among Calgon Carbon's Common Stock, S&P 500 Composite Index
and S&P Chemicals-Specialty Composite Index
[GRAPH APPEARS HERE]
COMPARISON OF FIVE YEAR CUMULATIVE RETURN*
AMONG CALGON CARBON COMMON STOCK, S&P 500 COMPOSITE INDEX
AND S&P CHEMICALS-SPECIALITY COMPOSITE INDEX
Measurement period
(Fiscal year Covered) Calgon Carbon S&P 500 S&P Chemicals-Specialty
- -------------------- ------------- ------- -----------------------
Measurement PT-
12/31/88 $100.00 $100.00 $100.00
FYE 12/31/89 162.43 131.69 121.79
FYE 12/31/90 160.83 127.60 117.03
FYE 12/31/91 160.09 166.47 165.22
FYE 12/31/92 133.18 179.15 175.03
FYE 12/31/93 99.45 197.21 199.57
Pension Benefits
The Company's Retirement Plan for Salaried Employees is a non-contributory
defined benefit pension plan. The following table shows the estimated annual
pension benefits which would be payable under the plan in the form of a single
life annuity, for various levels of average annual compensation and years of
service, based upon retirement at age 65 in the calendar year 1993, before any
reduction to take account of benefits payable by the Company's former owner,
Merck & Co., Inc. (by agreement with Merck, benefits payable under Company plans
are reduced by the benefit amounts payable to the individual by Merck, which are
computed utilizing a 2.5% compensation increase assumption).
Average annual
compensation for
highest
five consecutive years Annual benefits for years of service (1)
in 10-year period ------------------------------------------------------------
preceding retirement 15 years 20 years 25 years 30 years 35 years
- ---------------------- -------- -------- -------- -------- --------
$150,000 $ 33,045 $ 44,060 $ 55,075 $ 66,090 $ 77,105
200,000 44,670 59,560 74,450 89,340 104,230
250,000 56,295 75,060 93,825 112,590 131,355
300,000 67,920 90,560 113,200 135,840 158,480
350,000 79,545 106,060 132,575 159,090 185,605
400,000 91,170 121,560 151,950 182,340 212,730
450,000 102,795 137,060 171,325 205,590 239,855
500,000 114,420 152,560 190,700 228,840 266,980
(1) Under Section 415 of the Internal Revenue Code of 1986, the amount of
annual benefits which may be paid under the plan to any employee may not
exceed $115,641 during 1993 and $118,800
11
during 1994 and under Section 401(a)(17) of the Code, the amount of annual
compensation of each employee taken into account under the plan for any
year may not exceed $235,840 during 1993 and $150,000 during 1994. These
limitations have not been reflected in the table.
Other than the reduction with respect to Merck benefits discussed above, the
benefits payable under the plan are not subject to any deduction for Social
Security or other offset amounts. Covered compensation for purposes of the chart
above includes salary and incentive awards which are reported in the "bonus"
column of the Summary Compensation Table. As of December 31, 1993, Messrs.
Bailey, McConomy, Shannon, Tisch and Zanitsch had 6, 38, 8, 15 and 24 years
service, respectively, under the plan. Mr. Bailey is also covered by a pension
plan applicable to certain of the Company's foreign employees with respect to
his years of service in the Company's Belgian and other European operations.
Pursuant to the formula used to calculate the benefits payable to Mr. Bailey for
such service he is entitled to an annual amount upon retirement equal to the
greater of (a) .5% of his average compensation up to the parallel average
Belgian state pension ceiling, plus 1.5% of such compensation in excess of this
ceiling, for the period he was covered by the plan and (b) two times Mr.
Bailey's own contributions to the plan plus interest at 4% per year. In Mr.
Bailey's case the latter calculation would apply. Upon Mr. Bailey's retirement
at age 65 he would be entitled to payment of an estimated annual pension benefit
of $8,421 (based upon conversion of Belgian francs to U.S. dollars at the
exchange rates in effect at year-end) under such plan.
ELECTION OF INDEPENDENT AUDITORS
The Board of Directors, following the recommendation of the Audit Committee, has
nominated the independent public accounting firm of Price Waterhouse as the
independent auditors to examine the consolidated financial statements of the
Company for 1994. The proxies solicited on behalf of the Board of Directors will
be voted for that firm unless otherwise specified.
Price Waterhouse has served as the independent auditors for the Company since
its formation in 1985. Representatives of Price Waterhouse are expected to be
present at the Annual Meeting. They will have the opportunity to make statements
if they desire to do so and will be available to respond to appropriate
questions.
VOTE REQUIRED
The three nominees for election as directors at the Annual Meeting who receive
the greatest number of votes cast for the election of directors at that meeting
by the holders of the Company's Common Stock and Class A Stock, voting together
as one class, present in person or represented by proxy at the meeting and
entitled to vote at that meeting, a quorum being present, shall become directors
at the conclusion of the tabulation of votes. The affirmative vote of the
holders of a majority of the votes cast of the Company's Common Stock and Class
A Stock, voting together as one class, present in person or represented by proxy
at the meeting and entitled to vote at that meeting, a quorum being present, is
necessary to approve the actions proposed in item 2 of the accompanying Notice
of 1994 Annual Meeting of Stockholders. Under Delaware law and the Company's
Restated Certificate of Incorporation and By-laws, the total number of votes
cast "for" or "against" will be counted for purposes of determining the minimum
number of affirmative votes required for approval of item 2 and the total number
of votes cast "for" any of these matters will be counted for purposes of
determining whether sufficient affirmative votes have been cast. An abstention
from voting on a matter by a shareholder present in person or represented by
proxy at the meeting or any broker non-vote shall not be counted in such voting.
12
OTHER BUSINESS
The Board of Directors does not know of any other business to be presented to
the Annual Meeting of Stockholders. If any other matters properly come before
the meeting, however, the persons named in the enclosed form of proxy will vote
the proxy in accordance with their best judgment.
STOCKHOLDER PROPOSALS
If any stockholder wishes to present a proposal to be acted upon at the 1995
Annual Meeting of Stockholders, the proposal must be received by the Secretary
of the Company by November 16, 1994 to be considered for inclusion in the
Company's Proxy Statement and form of proxy relating to the 1995 Annual Meeting.
The 1995 Annual Meeting is tentatively scheduled for April 18, 1995.
Joseph A. Fischette
Secretary
March 17, 1994
13
CALGON CARBON CORPORATION
Proxy Solicited on Behalf of the Board of Directors of
the Company for Annual Meeting of the Stockholders April 19, 1994
P R O X Y
Thomas A. McConomy and Joseph A. Fischette, or either of them, are hereby
appointed proxies for the undersigned, with full power of substitution,
to vote all the shares of Common Stock of Calgon Carbon Corporation (the
"Company") which the undersigned may be entitled to vote, at the Annual
Meeting of Stockholders of the Company scheduled for April 19, 1994, and at
any adjournment thereof, as directed on the reverse side of this proxy card
and, in their discretion, on any other matters which may properly come before
the meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS and will be
voted as specified on the reverse side hereof. If not specified, the shares
represented by this proxy will be voted FOR proposals 1 and 2.
Please mark, sign and date this proxy card on the reverse side hereof and
return it in the enclosed envelope.
SEE REVERSE SIDE
[X] Please mark your votes as in this example.
This proxy when properly executed will be voted for in the manner directed
herein. If no direction is made, this proxy will be voted FOR election of
directors and FOR proposal 2.
- --------------------------------------------------------------------------------
The Board of Directors recommends a vote FOR proposals 1 and 2.
- --------------------------------------------------------------------------------
FOR WITHHELD
1. Election of [_] [_] Nominees: Colin Bailey
Directors. Ronald R. Tisch
Robert H. Zanitsch
For, except vote withheld from the following nominee(s):
________________________________________________________________________________
FOR AGAINST ABSTAIN
2. Election of Price Waterhouse [_] [_] [_]
as auditors for 1994.
YES NO
3. I plan to attend the [_] [_]
annual meeting.
SIGNATURE(S)_________________________________________ DATE ____________________
NOTE: Please sign exactly as name appears hereon. Joint owners should each
sign. When signing as attorney, executor, administrator, trustee or
guardian, please give full title as such.