<PAGE>
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 Section 240.14a-11(c) or Section 240.14a-12
CARBO CERAMICS INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
CARBO CERAMICS INC.
- --------------------------------------------------------------------------------
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notes:
<PAGE>
CARBO CERAMICS INC.
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of Carbo Ceramics Inc.:
Notice is hereby given that the Annual Meeting of Shareholders of Carbo Ceramics
Inc. will be held on Tuesday, April 15, 1997 at 9:00 A.M. Central Time, at the
Four Seasons Resort and Club, 4150 North MacArthur Boulevard, Irving, Texas, for
the following purposes:
1. To elect five directors to serve until the 1998 Annual Meeting.
2. To consider and act upon a proposal to ratify the appointment of Ernst &
Young LLP as independent auditors of the Company.
3. To transact such other business as may properly be brought before the
meeting.
Shareholders of record at the close of business on March 19, 1997 are the only
shareholders entitled to notice of and to vote at the Annual Meeting of
Shareholders.
By Order of the Board of Directors,
Paul G. Vitek
Secretary
Irving, Texas
March 20, 1997
IMPORTANT
Whether or not you expect to attend the meeting, please vote, sign, date and
return the enclosed proxy in the enclosed self-addressed envelope as promptly as
possible. If you attend the meeting, you may vote your shares in person, even
though you have previously signed and returned your proxy.
<PAGE>
CARBO CERAMICS INC.
600 East Las Colinas Boulevard
Suite 1520
Irving, Texas 75039
--------------------
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
The enclosed proxy is solicited on behalf of the Board of Directors of Carbo
Ceramics Inc. (the "Company") for use at the Company's Annual Meeting of
Shareholders ("Annual Meeting") to be held on April 15, 1997 at 9:00 A.M local
time, or at any adjournment or postponement thereof, for the purposes set forth
herein and in the accompanying Notice of Annual Meeting of Shareholders. The
Annual Meeting will be held at the Four Seasons Resort and Club, 4150 North
MacArthur Boulevard, Irving, Texas.
The Company's principal executive offices are located at 600 East Las Colinas
Boulevard, Suite 1520, Irving, Texas 75039. The telephone number at that
address is (972) 401-0090.
These proxy solicitation materials were mailed on or about March 20, 1997 to
all shareholders entitled to vote at the Annual Meeting.
INFORMATION CONCERNING SOLICITATION AND VOTING
RECORD DATE AND SHARES OUTSTANDING
Shareholders of record at the close of business on March 19, 1997 are entitled
to notice of, and to vote at, the Annual Meeting. At the record date,
14,602,000 shares of the Company's Common Stock were issued and outstanding and
entitled to be voted at the meeting.
REVOCABILITY OF PROXIES
A shareholder giving a proxy pursuant to this solicitation may revoke it at
any time before its use by delivering to the Secretary of the Company a written
notice of revocation or a duly executed proxy bearing a later date or by
attending the Annual Meeting and voting in person.
VOTING AND SOLICITATION
Every shareholder is entitled to one vote for each share held with respect to
each matter, including the election of directors, that comes before the Annual
Meeting. Shareholders do not have the right to cumulate their votes in the
election of directors. If a shareholder specifies how the proxy is to be voted
with respect to any of the proposals for which a choice is provided, the proxy
will be voted in accordance with such specifications. If a shareholder fails to
specify with respect to such proposals, the proxy will be voted FOR all director
nominees and FOR the ratification of Ernst & Young LLP as independent auditors.
Broker non-votes and abstentions are not treated as votes cast or shares
entitled to vote with respect to such proposals.
The cost of preparing, assembling, and mailing the proxy material and of
reimbursing brokers, nominees, and fiduciaries for the out-of-pocket and
clerical expenses of transmitting copies of the proxy material to the beneficial
owners of shares held of record by such persons will be borne by the Company.
The Company does not intend to solicit proxies otherwise than by use of the
mail, but certain employees of the Company, without additional compensation, may
use personal efforts, by telephone or otherwise, to obtain proxies.
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
Proposals of shareholders of the Company which are intended to be presented by
such shareholders at the Company's 1998 Annual Meeting must be received by the
Secretary of the Company no later than November 18, 1997, in order to be
eligible for inclusion in the proxy soliciting materials relating to that
meeting.
1
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of March 1, 1997, with respect to each
person who is known to the Company to be the beneficial owner of more than 5% of
the outstanding shares of Common Stock of the Company, the name and address of
such owner, the number of shares of Common Stock beneficially owned and the
percentage such shares comprised of the outstanding shares of Common Stock of
the Company. Except as indicated, each holder has sole voting and dispositive
power over the listed shares.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED
NAME AND ADDRESS -------------------------
OF BENEFICIAL OWNER NUMBER PERCENT
- ------------------- --------- -------
<S> <C> <C>
William C. Morris 6,002,000 41.10%
100 Park Avenue
New York, New York 10017
Lewis L. Glucksman 1,800,000 12.33%
388 Greenwich Street
New York, New York 10013
Robert S. Rubin 1,700,000 11.64%
390 Greenwich Street
New York, New York 10013
William A. Griffin 900,000 6.16%
9753 Pinelake Drive
Houston, Texas 77055
George A. Weigers 900,000 6.16%
230 Bridge Street
Vail, Colorado 80657
FMR Corporation (1) 839,100 5.75%
82 Devonshire Street
Boston, Massachusetts 02109
</TABLE>
- --------------------
(1) Based on Schedule 13G filed with the Securities and Exchange Commission as
of December 31, 1996, FMR Corp. held sole dispositive power as to 839,100
shares and various persons shared the right to receive or the power to
direct dividends from, or the proceeds from the sale of the shares.
The following table sets forth the number of shares of Common Stock of the
Company owned by each of the current directors and executive officers and by all
directors and executive officers as a group as of March 1, 1997.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL OWNERSHIP
------------------------- PERCENT OF
CURRENTLY ACQUIRABLE COMMON STOCK
OWNED WITHIN 60 DAYS BENEFICIALLY OWNED
DIRECTORS ----- -------------- -------------------
<S> <C> <C> <C>
William C. Morris 6,002,000 0 41.10%
Jesse P. Orsini 640,000 62,500 4.79%
William A. Griffin, Jr. 900,000 0 6.16%
Claude E. Cooke, Jr. 1,500 0 *
John J. Murphy 3,500 0 *
OTHER EXECUTIVE OFFICERS
Paul G. Vitek 0 27,500 *
Steven L. Cobb ** 3,000 0 *
ALL OFFICERS AND DIRECTORS AS A GROUP 7,550,000 90,000 51.39%
</TABLE>
* Less than 1% of total shares outstanding
** Mr. Cobb resigned his employment with the Company in March 1997. The
information set forth is based on Form 4 filings by Mr. Cobb prior to
his resignation.
2
<PAGE>
ELECTION OF DIRECTORS
NOMINEES
A board of five directors is to be elected at the meeting. Each director
elected to the board will hold office until the next Annual Meeting or until his
successor has been elected and qualified. Unless otherwise instructed, the
proxy holders will vote the proxies received by them for the five nominees named
below, all of whom are presently directors of the Company. In the event that
any nominee is unable or declines to serve as a director at the time of the
Annual Meeting, the proxies will be voted for any nominee who shall be
designated by the present Board of Directors to fill the vacancy. The proxies
cannot be voted for a greater number of persons than the number of nominees
named in this proxy statement. It is not expected that any nominee will be
unable or will decline to serve as a director.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE
DURING PAST 5 YEARS AND DIRECTOR
NAME (AGE) OTHER INFORMATION SINCE
---------- ----------------- -----
<S> <C> <C>
William C. Morris (58) Chairman of the Board of the Company; Chairman of the Board 1987
of J. & W. Seligman & Co., Incorporated (investment advisory
firm); Chairman of the Board of Tri-Continental Corporation; and
Chairman of the Boards of the companies in the Seligman family
of investment companies, all since 1988. Director of Kerr-McGee
Corporation.
Jesse P. Orsini (56) President and Chief Executive Officer of the Company. 1987
William A. Griffin, Jr. (81) Chairman of the Board, Emeritus, and former Chief Executive 1987
Officer of Daniel Industries, Inc. (producer of oil and gas
measurement systems).
Claude E. Cooke, Jr. (67) Partner, Hutcheson & Grundy LLP (law firm) since 1996; attorney 1996
with Pravel, Hewitt, Kimball & Krieger from 1990 to 1996; employed
by Exxon Production Research Company from 1954 to 1986; the
inventor of sintered bauxite, the original ceramic proppant.
John J. Murphy (65) Chairman of the Board, Emeritus, Dresser Industries, Inc. (hydro- 1996
carbon energy products and services); Chairman and Chief Executive
Officer of Dresser Industries, Inc. from 1983 to 1995; President
of Dresser Industries, Inc. from 1982 to 1992; Director of
Pepsi Co., Inc., NationsBank Corporation, Kerr-McGee Corporation
and W. R. Grace & Co.
</TABLE>
COMMITTEES OF THE BOARD OF DIRECTORS AND MEETING ATTENDANCE
The Board of Directors met six times during the last fiscal year. The Board
of Directors has Audit and Compensation committees each comprised of three
members. The Board of Directors does not have a nominating committee.
Directors who are employees of the Company are not compensated for serving as
directors. Directors who are not employees of the Company are paid $4,000 per
calendar quarter plus $1,000 per meeting for attending meetings of the Board of
Directors or meetings of any committee thereof not immediately preceding or
following a meeting of the Board of Directors. The Chairman of the Board of
Directors is paid $8,000 per calendar quarter plus $1,000 per meeting for
attending meetings of the Board of Directors or meetings of any committee
thereof not immediately preceding or following a meeting of the Board of
Directors. All directors are reimbursed for out-of-pocket expenses incurred by
them in attending meetings of the Board of Directors and its committees and
otherwise in performing their duties as directors.
The Audit Committee includes William C. Morris, Chairman, Claude E. Cooke and
John J. Murphy. The Committee met once during the last fiscal year. The Audit
Committee recommends engagement of the
3
<PAGE>
independent auditors, considers the fee arrangement and scope of the audit,
reviews the financial statements and the independent auditors' report, considers
comments made by the independent auditors with respect to the Company's internal
control structure, and reviews internal accounting procedures and controls with
the Company's financial and accounting staff.
The Compensation Committee includes William C. Morris, Chairman, William A.
Griffin and John J. Murphy. The committee met once during the last fiscal year.
The Compensation Committee establishes policies relating to the compensation of
executive officers and key management employees of the Company, reviews and acts
upon the President and Chief Executive Officer's recommendations on incentive
compensation awards and oversees the administration of the Company's stock
option plan.
EXECUTIVE COMPENSATION
The following table sets forth certain information concerning annual and long-
term compensation for the Company's Chief Executive Officer and executive
officers whose total salary and bonus exceeded $100,000 for services rendered in
all capacities to the Company during the year ended December 31, 1996:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
- ------------------------------------------------------------------------------------------------------------------------
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
---------------------------------------------------------------
OTHER | NUMBER OF |
ANNUAL | SECURITIES |
COMPEN- | UNDERLYING |
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS (1) SATION (2) | OPTIONS |
- --------------------------------------------------------------------------------------------------------|---------------|
<S> <C> <C> <C> <C> | <C> |
Jesse P. Orsini, Director, President and | |
Chief Executive Officer.............. 1996 $223,067 $110,320 $13,817 | 250,000 |
| |
Paul G. Vitek, Vice President of Finance, | |
Secretary and Treasurer.............. 1996 84,000 115,000 13,817 | 110,000 |
| |
Steven L. Cobb, Former Vice President of | |
Marketing............................ 1996 82,500 108,000 13,817 | 110,000 |
</TABLE>
- --------------------
(1) For Messrs. Vitek and Cobb, bonus consists of amounts payable under the
Company's incentive compensation plan and includes a deferred bonus of $55,000
and $50,000, respectively, that may be forfeited to the Company under certain
circumstances.
(2) Consists of Company contributions to the Company's profit sharing plan.
<TABLE>
<CAPTION>
The following table sets forth certain information concerning options granted
during 1996 to the named executives:
INDIVIDUAL GRANTS (1)
- ------------------------------------------------------------------------------------------------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS GRANTED EXERCISE OR
UNDERLYING TO EMPLOYEES IN BASE PRICE EXPIRATION GRANT DATE
NAME OPTIONS GRANTED FISCAL YEAR PER SHARE DATE PRESENT VALUE (2)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Jesse P. Orsini 250,000 35.71% $17.00 4/26/2006 $1,377,500
Paul G. Vitek 110,000 15.71% 17.00 4/26/2006 606,100
Steven L. Cobb 110,000 15.71% 17.00 4/26/2006 606,100
</TABLE>
- --------------------
(1) All options become exercisable in four equal annual installments commencing
on the first anniversary of the date of grant or earlier upon the change in
control of the Company.
(2) Option values reflect Black-Scholes model output for options. The
assumptions used in the model were expected volatility of .30, risk-free rate of
return of 6.19%, dividend yield of 1.5%, and projected time of exercise of five
years.
4
<PAGE>
The following table presents the value of unexercised options held by the named
executives at December 31, 1996:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING IN-THE-MONEY
UNEXERCISED OPTIONS OPTIONS
AT FISCAL YEAR-END AT FISCAL YEAR-END
EXERCISABLE (E)/ EXERCISABLE (E)/
NAME UNEXERCISABLE (U) UNEXERCISABLE (U)
- --------------------------------------------------------------
<S> <C> <C>
Jesse P. Orsini 250,000 U $1,000,000 U
Paul G. Vitek 110,000 U 440,000 U
Steven L. Cobb 110,000 U 440,000 U
</TABLE>
The Company has entered into an employment agreement with Mr. Orsini, which
will expire on June 30, 2000 (the "Employment Term"), pursuant to which Mr.
Orsini is employed as President and Chief Executive Officer of the Company.
During the Employment Term, Mr. Orsini will receive an annual base salary of not
less than $250,000 and an incentive bonus for each fiscal year (prorated for
1996 and 2000) equal to the sum of (a) 0.5% of the Company's earnings before
interest and taxes for such fiscal year ("EBIT") up to $20,000,000, plus (b)
1.0% of EBIT between $20,000,000 and $25,000,000 plus (c) 2.0% of EBIT in excess
of $25,000,000. Mr. Orsini will also be entitled to continue to participate in
all benefit plans available to other executive officers of the Company during
the Employment Term, other than the Company's Incentive Compensation Plan. In
the event that Mr. Orsini's employment is terminated by the Company without
cause during the Employment Term, Mr. Orsini will receive two years' base
salary, payable in installments, and a prorated incentive bonus, any unvested
stock options that he holds under the Company's stock option plan will vest
immediately and all of his outstanding options under the Company's stock option
plan will be exercisable for a period of 30 days following termination. In the
event that Mr. Orsini's employment is terminated for any other reason, Mr.
Orsini will receive his base salary earned to the date of termination and any
earned but unused vacation and any stock options that he holds will terminate in
accordance with the terms of the Company's stock option plan. In addition, in
the event of Mr. Orsini's death or disability or if Mr. Orsini terminates his
employment following a change in control of the Company, Mr. Orsini will receive
a prorated incentive bonus for the year in which his employment terminates. The
agreement also contains a five-year non-competition covenant that would become
effective upon termination of Mr. Orsini's employment for any reason.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
COMPENSATION POLICY. The goal of the Company's compensation policy is to
ensure that executive compensation is related to and supports the Company's
overall objectives of improving profitability and enhancing shareholder value.
To achieve this goal, the Compensation Committee has adopted the following
guidelines to direct compensation decisions:
. provide a competitive compensation package that enables the Company to
attract and retain superior management personnel;
. relate compensation to the performance of the Company and the individual;
. align employee objectives with the objectives of shareholders by
encouraging executive stock ownership.
ELEMENTS OF COMPENSATION. The Committee believes that the above objectives
are best achieved by combining current and deferred cash compensation with
equity based compensation. In 1996, the Company's compensation program for
executive officers and other key managers consisted of (i) base salary; (ii)
performance-based current and deferred bonuses based upon the Company's net
income before tax; (iii) stock option grants under the Company's 1996 Stock
Option Plan for Key Employees and (iv) matching contributions and discretionary
contributions under the Company's Savings and Profit Sharing Plan.
Base Salary. Executives' base salary levels are reviewed annually to
determine whether they are near the median range for persons holding similar
positions with companies that are engaged in similar businesses, are of a
similar size and complexity or that would otherwise compete for the services of
the Company's key managers and executive officers. It is the goal of the
Compensation Committee to set salary ranges for the Company's executive
5
<PAGE>
officers at the 50th percentile when compared to these similar businesses. The
Compensation Committee uses various salary surveys, prepared by independent
compensation analysts, to determine the salary level that falls at the 50th
percentile. Individual salaries are established within the salary range based on
individual performance in the most recently completed twelve months. Base
salaries for 1996 were established prior to the establishment of the
Compensation Committee on July 9, 1996.
Current and Deferred Bonuses. Since the inception of the Company, it has been
management's objective to have a significant portion of key employee
compensation performance-based. In order to achieve this objective the Company
established the Carbo Ceramics Inc. Incentive Compensation Plan ("the Incentive
Compensation Plan") that generates an incentive compensation "pool", the size of
which is determined by the net income before tax that is generated by the
Company annually. Upon its formation, the Compensation Committee reviewed and
ratified the Incentive Compensation Plan.
The President and Chief Executive Officer of the Company, who is not a
participant in the Incentive Compensation Plan, recommends to the Compensation
Committee a distribution of the pool among key employees, including executive
officers, of the Company. Individual performance is the key factor considered
by the President and Chief Executive Officer in determining the recommended
distribution for each key employee and executive officer. In order to retain
the services of key employees and executive officers, a substantial portion of
the amount awarded under the Incentive Compensation Plan is paid on a deferred
basis over a three year period and is subject to forfeiture if the executive's
employment with the Company ceases for any reason other than death, permanent
disability or normal retirement. In 1996, the portion of incentive compensation
that was deferred was approximately 40%.
Stock Options. The Compensation Committee strongly believes that the
interests of shareholders and executives become more closely aligned when
executives are provided with an opportunity to acquire a proprietary interest in
the Company through ownership of the Company's Common Stock. Accordingly, key
employees and executive officers of the Company are eligible to participate in
the 1996 Stock Option Plan for Key Employees whereby they are granted options to
purchase shares of the Company's Common Stock in the future at a price that is
specified at the time of the grant. Stock options are granted with an exercise
price of no less than the fair market value on the date of the grant and are
exercisable in four equal annual installments beginning one year after the date
of the grant.
Individual stock option grants are determined based on individual and company
performance. Stock options to purchase a total of 220,000 shares of the
Company's Common Stock at a price of $17.00 per share were granted to executive
officers, excluding the President and Chief Executive Officer, of the Company in
1996.
CEO COMPENSATION. Jesse P. Orsini has been President and Chief Executive
Officer of the Company since its inception in 1987. Mr. Orsini's compensation
package has been designed to encourage short and long-term performance in line
with shareholder interests. Mr. Orsini has an employment agreement with the
Company that expires on June 30, 2000. Under the terms of the agreement, Mr.
Orsini will receive an annual base salary of not less than $250,000 per year and
an incentive bonus based on the net income before tax generated by the Company.
In light of the existence of the employment agreement between the Company and
Mr. Orsini, none of the incentive bonus earned under the terms of the agreement
is deferred. In 1996, Mr. Orsini was granted options to purchase 250,000
shares of the Company's Common Stock at a price of $17.00 per share under the
terms of the 1996 Stock Option Plan for Key Employees.
The Compensation Committee believes that Mr. Orsini's total compensation is
reflective of his position and responsibility and that he is paid comparably to
chief executive officers of companies of similar size and complexity.
Members of the Compensation Committee
William C. Morris, Chairman
William A. Griffin
John J. Murphy
6
<PAGE>
CERTAIN TRANSACTIONS WITH MANAGEMENT AND OTHERS
Consulting Agreement . Pursuant to a consulting agreement, William C. Morris
provided certain consulting services to the Company (in addition to services
provided in his capacity as Chairman of the Board of Directors), which focused
on strategic planning and finance. The consulting agreement was terminated upon
the execution of a definitive underwriting agreement relating to the initial
public offering of the Company's Common Stock on April 22, 1996. Under the
terms of the agreement, Mr. Morris received fees of $227,000 for the portion of
1996 during which the agreement was in effect.
S Corporation Distributions. On April 19, 1996, prior to the initial public
offering of the Company's Common Stock, the Company declared and paid a dividend
of $26.8 million, in respect of previously taxed undistributed S Corporation
earnings to shareholders of record on April 19, 1996 (Messrs. Glucksman,
Griffin, Morris, Orsini, Rubin and Weigers). The distribution was paid in the
form of promissory notes ("the Shareholder Notes"), bearing interest at a rate
equal to the base rate of the Company's commercial bank loan plus 0.5% and due
April 30, 2000. On April 19, 1996 the Company also declared a dividend in an
amount equal to the amount of previously untaxed undistributed S Corporation
earnings from the period January 1, 1996 until and including the date after the
date on which the Company executed a definitive underwriting agreement in
connection with the initial public offering of its Common Stock, payable within
sixty days of such date to shareholders of record on such date. The definitive
underwriting agreement was executed on April 22, 1996 and a dividend in the
aggregate amount of $2.3 million was paid to the Company's original shareholders
on June 24, 1996 in satisfaction of this obligation. On April 26, 1996 the
Shareholder Notes were repaid. The total amount of the repayment was $26.9
million including interest expense of $45,600.
Tax Indemnification Agreement. Prior to the completion of the initial public
offering of the Company's Common Stock, the Company and its shareholders entered
into a tax indemnification agreement (the "Tax Agreement"). Subject to certain
limitations, the Tax Agreement generally provides that the Company will be
indemnified by its six original shareholders on a pro rata basis, and the six
original shareholders will be indemnified by the Company, for increases in taxes
and certain other costs that result from a reallocation by a taxing authority of
taxable income between the period in which the Company was taxed as an S
Corporation and the period in which the Company was taxed as a C Corporation.
The amount payable by the Company or an original shareholder with respect to a
reallocation will be limited to the tax benefit derived by the Company or the
shareholder, respectively, as a result of the reallocation.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Subject to ratification by the shareholders, the Board of Directors has
reappointed Ernst & Young LLP as independent auditors to audit the financial
statements of the Company for the current fiscal year.
Representatives of the firm of Ernst & Young LLP are expected to be present at
the Annual Meeting and will have an opportunity to make a statement if they so
desire and will be available to respond to appropriate questions.
The Audit Committee and the Board of Directors recommend the shareholders vote
"FOR" such ratification.
OTHER MATTERS
The Board of Directors knows of no other matters to be brought before the
Annual Meeting. However, if other matters should properly come before the
Annual Meeting, it is the intention of each of the persons named in the proxy to
vote in accordance with his judgment on such matters.
7
<PAGE>
STOCK PERFORMANCE GRAPH
The following graph sets forth the cumulative total shareholder return
(assuming reinvestment of dividends) to Carbo Ceramics Inc. shareholders during
the period beginning April 23, 1996, and ending December 31, 1996, as well as an
overall stock market index (The Nasdaq Stock Market Total Return Index) and a
peer group index (Oil and Gas Field Service Stocks, Source: Media General
Financial Services):
[STOCK PERFORMANCE GRAPH APPEARS HERE]
OIL & GAS
NASDAQ CARBO CREAMICS FIELD SERVICE STOCKS
------ -------------- --------------------
4/23....................... 100.00 100.00 100.00
Apr ....................... 102.08 117.82 100.00
May ....................... 106.76 131.52 97.02
June ...................... 101.95 120.56 97.72
July ...................... 92.87 112.06 91.07
Aug ....................... 98.08 103.13 97.00
Sep ....................... 105.58 110.00 99.32
Oct ....................... 104.43 109.04 112.97
Nov ....................... 110.90 112.49 117.82
Dec ....................... 110.77 115.94 116.77
The stock performance graph assumes $100 was invested on April 23, 1996.
By Order of the Board of Directors
Paul G. Vitek
Secretary
8
<PAGE>
(FRONT)
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CARBO CERAMICS INC.
The undersigned hereby appoints Jesse P. Orsini and Paul G. Vitek, or any
one or more of them, as proxies, each with the power to appoint his substitute,
and hereby authorizes each of them to represent and to vote, as designated on
the reverse side, all the shares of Common Stock of Carbo Ceramics Inc. held of
record by the undersigned on March 19, 1997 at the Annual Meeting of
Shareholders to be held on April 15, 1997, or any adjournment or continuation
thereof.
(Please See Reverse Side)
<PAGE>
<TABLE>
<CAPTION>
(BACK)
Please mark your
vote as indicated in X
this example
<S> <C> <C> <C>
1. To elect five Directors. 2. Proposal to ratify the 3. In their discretion to vote
FOR all nominees WITHHOLD appointment of Ernst & upon such other
listed below (except AUTHORITY Young LLP, certified public business as may properly
as marked to the to vote for accountants, as come before the
contrary below) all nominees independent auditors for the meeting.
listed below fiscal year ending
December 31, 1997.
FOR AGAINST ABSTAIN
[_] [_] [_] [_] [_]
INSTRUCTIONS: To withhold authority to vote for any
-------------------------------------
individual nominee, strike a line through the nominee's
- -------------------------------------------------------
name in the list below:
- -----------------------
Claude E. Cooke, Jr. The Board of Directors recommends that you vote
William A. Griffin, Jr. FOR the nominees and the proposal listed above.
William C. Morris This proxy when properly executed will be voted
John I Murphy in the manner directed herein by the undersigned
Jesse P. Orsini shareholder. If no direction is given, this proxy
will be voted FOR the nominees and the proposal.
DATED:_____________________________________ 1997.
________________________________________________
(SIGNATURE OF SHAREHOLDER)
________________________________________________
(SIGNATURE IF HELD JOINTLY)
PLEASE SIGN EXACTLY AS NAME APPEARS HEREON. WHEN SHARES ARE HELD BY JOINT TENANTS, BOTH SHOULD SIGN. WHEN SIGNING AS ATTORNEY,
EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE GIVE FULL TITLE AS SUCH. IF A CORPORATION, PLEASE SIGN FULL CORPORATE NAME BY
PRESIDENT OR OTHER AUTHORIZED OFFICER. IF A PARTNERSHIP, PLEASE SIGN IN PARTNERSHIP NAME BY AUTHORIZED PERSON.
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