<PAGE>
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a 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
Primex Technologies Inc.
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[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 prelilinary 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>
PRIMEX(TM)
TECHNOLOGIES
10101 9th Street North
St. Petersburg, FL 33716
March 23, 1999
Dear Shareholder:
You are cordially invited to attend our 1999 Annual Meeting of
Shareholders at 10:00 a.m. on Tuesday, May 4, 1999. The meeting will
be held at the Hyatt Regency Westshore, 6200 Courtney Campbell
Causeway, Tampa, Florida.
Angelo A. Catani, who reached age 65, retired as Vice Chairman and
from the Board of Primex effective December 31, 1998. To ensure
management continuity, we are pleased to announce that J. Douglas
DeMaire, who was elected as a Director by the Board effective January
1, 1999, is a nominee for the first time. Mr. DeMaire is President of
Primex.
The accompanying Notice of Annual Meeting and Proxy Statement
describe the proposals to be considered at the meeting. Whether or not
you plan to attend, please sign and date the enclosed form of proxy
and return it in the enclosed envelope, which requires no postage if
mailed in the United States. If you do plan to attend, please so
indicate by checking the appropriate box on the proxy card.
Sincerely,
/s/James G. Hascall
-----------------------------
James G. Hascall
Chairman of the Board and
Chief Executive Officer
<PAGE>
PRIMEX TECHNOLOGIES, INC.
10101 9th Street North
St. Petersburg, FL 33716
------------
NOTICE OF THE 1999 ANNUAL MEETING OF SHAREHOLDERS
------------
PRIMEX TECHNOLOGIES, INC. will hold its 1999 Annual Meeting of
Shareholders on Tuesday, May 4, 1999, at the Hyatt Regency Westshore,
6200 Courtney Campbell Causeway, Tampa, Florida. The meeting will
begin at 10:00 a.m.
The Board of Directors has fixed the close of business on March 9,
1999 as the record date for determining shareholders entitled to
notice of, and to vote at, the meeting or any adjournments that may
take place. At the meeting, the shareholders will consider and take
action on the following:
(1) election of four directors;
(2) ratification of the appointment of independent auditors for 1999;
and
(3) transaction of any other business properly presented at the
meeting or any adjournment.
By order of the Board of Directors:
/s/ George H. Pain
----------------------------
George H. Pain
Secretary
March 23, 1999
YOUR VOTE IS IMPORTANT
You are urged to sign, date and promptly
return your proxy card in the enclosed envelope.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Shares Outstanding and Entitled to Vote............................... 1
Certain Beneficial Owners............................................. 2
Proposal No. 1--Election of Directors................................. 2
Additional Information Regarding the Board of Directors............... 4
Committees of the Board
Attendance
Compensation of Directors
Security Ownership of Directors and Officers.......................... 6
Stock Ownership Guidelines
Section 16(a) Beneficial Ownership Reporting Compliance
Executive Compensation................................................ 8
Report of the Compensation and Nominating Committee
Summary Compensation Table
Option Grants of Common Stock in 1998
Aggregated Option Exercises in 1998 and Year-end Option Values
Performance Graph
Executive Agreements and Change-in-Control Agreements
Proposal No. 2--Appointment of Independent Auditors................... 14
Certain Relationships and Related Transactions........................ 15
Miscellaneous......................................................... 15
Shareholder Proposals
</TABLE>
<PAGE>
PRIMEX TECHNOLOGIES, INC.
PROXY STATEMENT
----------------
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 4, 1999
This Proxy Statement is furnished to the shareholders of Primex
Technologies, Inc. ("PRIMEX") in connection with the solicitation by the Board
of Directors (the "Board") of PRIMEX of proxies to be voted at the Annual
Meeting of Shareholders to be held on May 4, 1999, and at any adjournment
thereof. The mailing address of PRIMEX's principal executive office is 10101
9th Street North, St. Petersburg, FL 33716. This Proxy Statement, the related
proxy card and PRIMEX's Annual Report on Form 10-K are first being mailed to
shareholders on or about March 23, 1999.
PRIMEX was organized under the laws of the Commonwealth of Virginia on May
10, 1996 as a wholly-owned subsidiary of Olin Corporation ("Olin"). PRIMEX
began operating as an independent publicly held company on December 31, 1996
as a result of its spin-off from Olin.
Shares represented by duly executed proxies in the accompanying form,
received by PRIMEX prior to the meeting, will be voted at the meeting. Where a
shareholder directs in the proxy a choice regarding any matter that is to be
voted on, that direction will be followed. If no direction is made, proxies
will be voted for the election of directors as set forth below and in favor of
the ratification of the appointment of Ernst & Young, LLP as PRIMEX's
independent auditors for 1999. PRIMEX does not know of any matters other than
those referred to in the accompanying Notice that are to come before the
meeting. If any other matters are properly presented for action, the persons
named in the accompanying form of proxy will vote the proxy in accordance with
their best judgment. Any person who has returned a proxy has the power to
revoke it at any time before it is exercised by submitting a subsequently
dated proxy, by giving notice in writing to the Secretary or by voting in
person at the meeting.
SHARES OUTSTANDING AND ENTITLED TO VOTE
The close of business on March 9, 1999 has been fixed as the record date for
the 1999 PRIMEX Annual Meeting of Shareholders and any adjournment thereof. As
of the record date, there were 5,080,459 shares of PRIMEX Common Stock, $1 par
value ("Common Stock"), outstanding, each of which is entitled to one vote. Of
those shares of Common Stock outstanding as of the record date, approximately
527,000 shares were held in the Primex Technologies, Inc. Retirement
Investment Management Experience Plan (the "PRIME Plan") and approximately
487,000 shares were held in the Olin Corporation Contributing Employee
Ownership Plan (the "CEOP"), all of which are held by Wachovia Bank, N.A. as
the Trustee of the PRIME Plan and the CEOP (the "Trustee"). Each individual
participating in the PRIME Plan and the CEOP is entitled to instruct the
Trustee how to vote all shares of Common Stock credited to the individual's
account as of the record date. Shares of Common Stock held in the PRIME Plan
and the CEOP for which voting instructions are not received from PRIME Plan or
CEOP participants, respectively, will be voted by the Trustee in the same
proportion as shares of Common Stock for which the Trustee has received
instructions.
On February 2, 1999, the Board of Directors of PRIMEX declared a 2-for-1
stock split in the form of a 100% stock dividend payable on March 22, 1999 to
shareholders of record of the Corporation's Common Stock on February 22, 1999.
All share numbers in this proxy statement are pre-split shares.
ChaseMellon Shareholder Services, LLP is PRIMEX's registrar and transfer
agent.
<PAGE>
CERTAIN BENEFICIAL OWNERS
Except as noted below, PRIMEX knows of no person who was the beneficial
owner of more than five percent of PRIMEX Common Stock as of December 31,
1998. This information is based on reports filed by such persons with the
United States Securities and Exchange Commission ("SEC").
<TABLE>
<CAPTION>
Amount and
Nature of
Name and Address of Beneficial Percent of
Beneficial Owner Ownership Class
------------------- ---------- ----------
<S> <C> <C>
Jeffrey S. Halis.................................... 547,954 (a) 10.77
500 Park Avenue, 5th Floor
New York, NY 10022
Neuberger Berman, LLC............................... 483,900 (b) 9.48
605 Third Ave.
New York, NY 10158-3698
Neuberger Berman Genesis Portfolio.................. 290,600 (b) 5.69
605 Third Ave.
New York, NY 10158-3698
</TABLE>
- --------
(a) As reported on a Form 4 filed with the SEC on October 9, 1998, Jeffrey S.
Halis, had as of September 22, 1998, sole power to vote and sole
dispositive power with respect to 359,444 shares owned by Tyndall
Partners, L.P., 100,080 shares owned by Tyndall Institutional Partners,
L.P., 46,070 shares owned by Madison Avenue Partners, L.P. and 42,360
shares owned by Halo International, Ltd.
(b) As reported on a Schedule 13G filed with the SEC on February 12, 1999,
Neuberger Berman, LLC ("Neuberger"), a registered investment advisor, is
deemed to have beneficial ownership as of December 31, 1998 of 483,900
shares. As reported in the 13G, Neuberger possesses sole voting power with
respect to 193,300 of such shares, shared voting power with respect to
290,600 of such shares and shared dispositive power with respect to all
483,900 shares. Neuberger and Neuberger Berman Management Inc. serve as
sub-advisor and investment manager, respectively, to the Neuberger Berman
Genesis Portfolio, a series of Equity Managers Trust. The Neuberger Berman
Genesis Portfolio has shared voting and shared dispositive power with
respect to all 290,600 shares.
PROPOSAL NO. 1--ELECTION OF DIRECTORS
The members of the Board of Directors of PRIMEX are divided into three
classes with the term of office of each class being three years, ending in
different years. Three persons, as set forth below under "Nominees for Terms
Expiring at the 2002 Annual Meeting," have been nominated by the Board for
election as Class III directors to serve until the Annual Meeting of
Shareholders in 2002 and thereafter until their successors have been duly
elected and have qualified. In addition, Mr. J. Douglas DeMaire has been
nominated by the Board for election as a Class II Director to serve until the
2001 Annual Meeting of Shareholders and thereafter until his successor has
been duly elected and qualified. Mr. DeMaire was elected as a Class II
Director by the Board, effective January 1, 1999, to fill the vacancy created
by the retirement of Angelo A. Catani on December 31, 1998. The terms of the
other directors will continue after the meeting as indicated below.
Each of the nominees is a director at the present time. It is not expected
that any of the nominees will be unable to serve as a director, but if any
current nominee is unable to accept election, shares for which proxies have
been received will be voted for the election of a substitute nominee selected
by the Board, unless the number of directors is reduced.
The election of each nominee as a director requires the affirmative vote of
a plurality of the votes cast in the election. Votes withheld and shares held
in street name ("Broker Shares") that are not voted in the election of
directors will not be included in determining the number of votes cast.
2
<PAGE>
The Board of Directors recommends a vote FOR the election as directors of
all of the nominees listed below.
CLASS II
NOMINEE FOR TERM EXPIRING AT THE 2001 ANNUAL MEETING
J. DOUGLAS DEMAIRE, 52, is President of PRIMEX, a position he has held since
January 1999. From January 1997, when PRIMEX was spun off from Olin
Corporation, until December 1998, he served as Executive Vice President. From
December 1995 through December 1996, Mr. DeMaire was Vice President, Corporate
Planning of Olin with responsibilities for strategic planning, corporate
development, mergers and acquisitions. From 1991 to 1995, he was Vice
President, Planning and Development for Olin's Brass and Winchester Divisions.
Mr. DeMaire has served as a director of PRIMEX since January 1999.
CLASS III
NOMINEES FOR TERMS EXPIRING AT THE 2002 ANNUAL MEETING
JAMES G. HASCALL, 60, is Chairman and Chief Executive Officer of PRIMEX, a
position he assumed in January 1997 when PRIMEX was spun off from Olin
Corporation. From January 1, 1996 through December 1996, Mr. Hascall served as
Executive Vice President of Olin, having operating responsibility for Olin's
Brass, Winchester, Ordnance and Aerospace Divisions. From 1985 through 1995,
Mr. Hascall served as President of Olin's Brass Division. He was an Olin
Corporate Vice President from 1985 to 1990 and a Senior Vice President from
1990 to December 1995.
DAVID LASKY, 66, is Chairman of the Board of Directors and President of
Curtiss-Wright Corporation. Mr. Lasky joined Curtiss-Wright in 1962, was
elected General Counsel in 1967, Senior Vice President in 1980 and Corporate
Secretary in 1989. In 1993, he was elected Director, President and Chief
Executive Officer of Curtiss-Wright, and in 1995, he was elected to the
additional position of Chairman of the Board. Mr. Lasky has served as a
director of PRIMEX since January 1997.
WILLIAM B. MITCHELL, 63, retired as Vice Chairman of the Board of Texas
Instruments Incorporated in December 1996. Mr. Mitchell joined Texas
Instruments in 1961, was elected a Corporate Vice President and President of
the Defense Systems and Electronics Group in 1984, Executive Vice President
and President of the Systems and Equipment Sector in 1991 and Vice Chairman in
1993. He is a director of Curtiss-Wright Corporation and a trustee of Mitre
Corporation. Mr. Mitchell has served as a director of PRIMEX since January
1997.
CLASS I
DIRECTORS WHOSE TERMS CONTINUE UNTIL THE 2000 ANNUAL MEETING
EDWIN M. GLASSCOCK, 70, is President of Edwin M. Glasscock Associates, Inc.,
a management consulting firm that he founded in 1966. Dr. Glasscock has served
as a director of PRIMEX since January 1997.
ROBERT H. RAU, 62, retired as President of the Aerostructures Group of B.F.
Goodrich Company in September 1998. From April 1993 until its merger with B.
F. Goodrich in December 1997, Mr. Rau was President and Chief Executive
Officer of Rohr, Inc. From 1988 to 1993, Mr. Rau served as Executive Vice
President of Parker Hannifin Corporation and President of the Aerospace Group
of Parker Hannifin. He is a member of the Board of Directors of B.F. Goodrich
Company, Willis Lease Finance Corporation and HCC Industries Inc. Mr. Rau has
served as a director of PRIMEX since January 1997.
LEON E. SALOMON, 62, is Senior Vice President of Procurement for Rubbermaid
Incorporated, a position he has held since January 1998. From May 1996 to
January 1998, he was the Corporate Vice President of Purchasing and Logistics
for Rubbermaid. General Salomon retired from active duty in the U.S. Army in
1996 after 36 years of service. From 1994 to 1996, General Salomon commanded
the U.S. Army Material Command.
3
<PAGE>
From 1992 to 1994, he was the U.S. Army Deputy Chief of Staff for Logistics.
Prior to that assignment, he was the Deputy Commanding General for Combined
Arms Support, U.S. Army Training and Doctrine Command, and Commanding General,
U.S. Army Combined Arms Support Command at Fort Lee, Virginia. General Salomon
has served as a director of PRIMEX since January 1997.
CLASS II
DIRECTORS WHOSE TERMS CONTINUE UNTIL THE 2001 ANNUAL MEETING
BOB MARTINEZ, 64, is Managing Director, Government Consulting Group of
Carlton, Fields, Ward, Emmanuel, Smith & Cutler, P.A., a position he has held
since January 1999. From 1993 to January 1999, he was a principal of Bob
Martinez & Company, a domestic and international business development
consulting firm that he founded in 1993. From 1991 to 1993, pursuant to
presidential appointment, Mr. Martinez served as the United States Drug Czar,
and from 1987 to 1991, he served as the Governor of the State of Florida. Mr.
Martinez has served as a director of PRIMEX since January 1997.
ANTHONY W. RUGGIERO, 57, is Executive Vice President and Chief Financial
Officer of Olin Corporation, a position he has held since January 1999. From
September 1995 until January 1999, he was Senior Vice President and Chief
Financial Officer of Olin. Prior to joining Olin, for the period 1990 to 1995,
Mr. Ruggiero was Senior Vice President and Chief Financial Officer of Reader's
Digest Association, Inc. Mr. Ruggiero has served as a director of PRIMEX since
January 1997.
ADDITIONAL INFORMATION REGARDING THE BOARD OF DIRECTORS
Committees of the Board
The standing committees of the Corporation's Board of Directors are an Audit
Committee and a Compensation and Nominating Committee.
The Audit Committee advises the Board on internal and external audit matters
affecting PRIMEX, including the appointment of the independent auditors of
PRIMEX; reviews with such auditors the scope and results of their examination
of the financial statements of PRIMEX and any investigations and surveys
conducted by such auditors; reviews reports of PRIMEX's internal audit
activities; and reviews the presentation of PRIMEX's financial results. The
committee also advises the Board on compliance with the PRIMEX Code of
Business Conduct, on government and other compliance programs, on corporate
and governmental security matters and any major litigation involving PRIMEX.
The Audit Committee currently consists of Messrs. Rau (Chair), Ruggiero and
Salomon.
The Compensation and Nominating Committee sets policy, develops and monitors
strategies, and administers the programs addressing the compensation of the
Chief Executive Officer ("CEO") and the other senior executives of PRIMEX. The
committee approves the salary plans for the CEO and other senior executives.
It approves the measures, goals, objectives, weighting, payout matrices and
actual payouts and certifies performance for and administers PRIMEX's
incentive compensation plans. The committee approves broad-based retirement
and savings programs and approves amendments to the qualified and non-
qualified retirement plans and to the welfare and fringe benefit plans. The
committee administers the 1996 Long Term Incentive Plan of Primex
Technologies, Inc., issues an annual report on Executive Compensation that
appears in the Proxy Statement, approves Executive and Change in Control
Agreements and reviews plans for management development and succession. The
committee also advises the Board on such matters as the composition and
remuneration of the Board and committees thereof, including the nomination of
directors, protection against liability and indemnification. The committee
will consider candidates recommended by shareholders for election as directors
at annual meetings. Shareholder recommendations for director nominees must be
in writing and submitted to the Secretary of PRIMEX by December 1 of the year
prior to such meeting, accompanied by a biography and the written consent of
the candidate. The Compensation and Nominating Committee currently consists of
Messrs. Glasscock, Lasky, Martinez and Mitchell (Chair).
4
<PAGE>
The Corporation's Bylaws require that advance notice of nominations for the
election of directors to be made by a shareholder (as distinguished from a
shareholder's recommendation to the Compensation and Nominating Committee) be
given to the Secretary of PRIMEX no later than 90 days before an annual
meeting of shareholders or seven days following notice of special meetings of
shareholders for the election of directors, together with the name and address
of the shareholder and of the person to be nominated; a representation that
the shareholder is entitled to vote at the meeting and intends to appear there
in person or by proxy to make the nomination; a description of arrangements or
understandings between the shareholder and others pursuant to which the
nomination is to be made; such other information regarding the nominee as
would be required in a proxy statement filed under the SEC proxy rules; and
the consent of the nominee to serve as a director, if elected.
Attendance
During 1998, the Board held eight meetings, the Audit Committee, four
meetings and the Compensation and Nominating Committee, four meetings. All
directors attended at least 75% of the meetings of the Board and committees of
the Board on which they served.
Compensation of Directors
During 1998, directors who were not employees of PRIMEX received a fixed
annual retainer of $20,000 (50% of which was distributed in the form of Common
Stock) and an annual stock grant valued at $15,000. Each such director also
received a fee of $1,000 for each meeting of the Board and for each meeting of
a committee of the Board attended. Chairpersons of committees received an
additional annual fee of $3,000. The Primex Stock Plan for Nonemployee
Directors (the "Directors Plan") permits directors to (i) elect to receive the
balance of their fixed annual retainer in cash or Common Stock, (ii) receive
meeting fees in cash or Common Stock, and (iii) defer the cash or stock
portions of their annual retainer and meetings fees into cash accounts or into
stock accounts. Deferred cash balances are credited with interest and deferred
stock balances with dividend equivalents. During 1998, directors who were not
employees of PRIMEX participated, at the request of the Chairman of the Board,
in planning meetings and were paid $2,000 per meeting attended.
Directors are reimbursed for expenses incurred in the performance of their
duties as directors and are covered while on company business under the PRIMEX
business travel accident insurance policy which covers employees of PRIMEX
generally.
5
<PAGE>
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
The following table shows shares of PRIMEX Common Stock beneficially owned
as of January 15, 1999 by (i) each director of PRIMEX, (ii) each of the Named
Executive Officers (as herein defined) and (iii) all directors and executive
officers of PRIMEX as a group. Unless otherwise indicated in the footnotes
below, each person or entity has sole voting and investment power with respect
to the shares set forth opposite such person's or entity's name.
<TABLE>
<CAPTION>
No. of Shares
Beneficially Percent of
Name of Beneficial Owner Owned (a,b) Class (c)
------------------------ ------------- ----------
<S> <C> <C>
A. A. Catani................................... 21,957 --
J. D. DeMaire.................................. 29,982 --
E. M. Glasscock................................ 19,000 (d) --
J. G. Hascall.................................. 53,487 1.0%
D. Lasky....................................... 2,193 --
B. Martinez.................................... -- --
W. B. Mitchell................................. 1,946 --
R. H. Rau...................................... 3,900 (e) --
A. W. Ruggiero................................. 1,075 --
L. E. Salomon.................................. -- --
W. W. Smith.................................... 16,826 --
M. S. Wilson................................... 15,651 --
Directors and executive officers as a group,
including
those named above (16 persons)................ 205,477 4.0%
</TABLE>
- --------
(a) Excluded from this table are shares credited to deferred accounts pursuant
to the arrangements described above under "Compensation of Directors" in
the amounts of 4,085 shares for Dr. Glasscock, 2,804 for Mr. Martinez,
2,314 for Mr. Mitchell, 3,239 for Mr. Rau, 3,370 for Mr. Ruggiero and
2,237 for Mr. Salomon. Such shares have no voting power.
(b) The amounts shown include shares of PRIMEX Common Stock which the
following persons have the right to acquire as a result of the exercise of
stock options within 60 days after January 15, 1999 under the 1996 Long
Term Incentive Plan of Primex Technologies, Inc.:
<TABLE>
<S> <C>
A. A. Catani 10,000 shares
J. D. DeMaire 10,000 shares
J. G. Hascall 16,667 shares
W. W. Smith 5,000 shares
M. S. Wilson 6,667 shares
Directors and executive officers as a group,
including those named above: 62,002 shares
</TABLE>
(c) Unless otherwise indicated, beneficial ownership of any named individual
does not exceed 1% of the outstanding shares of PRIMEX Common Stock.
(d) Includes 10,000 shares held by Dr. Glasscock's spouse. Dr. Glasscock
disclaims beneficial ownership of such shares.
(e) Includes 3,000 shares held by a trust in which Mr. Rau is co-trustee
sharing voting and investment power and in which his children are
beneficiaries. Also includes 400 shares held by a trust in which his
stepchildren are beneficiaries and his spouse is trustee. Mr. Rau
disclaims beneficial ownership of such shares.
6
<PAGE>
Stock Ownership Guidelines
At its March 1997 meeting, the Compensation and Nominating Committee of the
Board of Directors established guidelines for stock ownership for all key
executives, including executive officers, and for all nonemployee Directors.
Within five years from the establishment of such guidelines, such persons have
been asked to acquire ownership of shares of PRIMEX Common Stock, the
aggregate value of which meets or exceeds:
<TABLE>
<S> <C>
Directors (nonemployee)....................... 4 times annual retainer
CEO........................................... 4 times annual base salary
Executive Vice Presidents and Division
Presidents................................... 3 times annual base salary
Other Executive Officers...................... 2 times annual base salary
All other key executives...................... 1 times annual base salary
</TABLE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
PRIMEX executive officers and directors, and persons who own more than ten
percent of a registered class of PRIMEX's equity securities, to file reports
of ownership and changes in ownership with the SEC. Executive officers,
directors and greater than ten-percent shareholders are required by SEC
regulation to furnish PRIMEX with copies of all Section 16(a) filings. Based
solely upon the review of copies of such filings furnished to PRIMEX or
written representations that no filings were required, PRIMEX believes that
for the period January 1, 1998 through December 31, 1998, all Section 16(a)
filing requirements applicable to its executive officers, directors and
greater than ten-percent beneficial owners were timely filed with the SEC.
7
<PAGE>
EXECUTIVE COMPENSATION
Report of the Compensation and Nominating Committee on Executive Compensation
The Compensation and Nominating Committee (the "Committee"), which is
composed of four members of the Board of Directors who are not PRIMEX officers
or employees, establishes and administers the executive compensation program
of PRIMEX.
Compensation Philosophy. The Committee, in designing and administering
PRIMEX's executive compensation program, seeks to achieve the following
objectives:
. to attract and retain high-quality executives;
. to create a link between executive compensation and PRIMEX's long-term
financial performance and shareholder value; and
. to unite management as a team.
The Committee believes that, in order to accomplish these objectives,
PRIMEX's compensation program must be competitive with the compensation
opportunities available at companies which compete with PRIMEX for executive
talent. Accordingly, in fashioning its executive compensation program, the
Committee has reviewed and analyzed, and will continue to review and analyze,
executive compensation data for companies which are similar to PRIMEX in size
and scope of operations ("Comparable Companies"). These data are obtained from
surveys conducted by independent compensation consultants. The compensation
surveys cover companies with which the Committee believes PRIMEX competes for
executive resources, but do not necessarily include the companies used in the
peer group comparison shown in the Performance Graph on page 13 of this Proxy
Statement. In reviewing such compensation data, the Committee takes into
account how PRIMEX's compensation policies and overall performance compare to
the Comparable Companies.
Components of Compensation Program. PRIMEX's executive compensation program
is comprised of the following three components:
. annual base salary;
. annual incentive compensation; and
. long-term incentive compensation.
The Committee believes that placing an emphasis on the variable-pay
components of the compensation program (annual incentive compensation and
long-term incentive compensation) is the most effective means of achieving the
above-described objectives and building shareholder value. Accordingly, the
Committee has endeavored to structure its executive compensation package so
that approximately 40% to 50% of an executive officer's total targeted
compensation consists of variable pay. The Committee intends to review its
executive compensation program each year in order to ensure that the type and
mix of compensation, including the emphasis on variable pay, are in line with
the objectives and performance of PRIMEX.
Annual Base Salary. In setting the annual base salaries of PRIMEX's
executive officers, including the Chief Executive Officer (the "CEO"), the
Committee reviews and analyzes base salary data for the Comparable Companies.
In determining whether to adjust the base salary of an executive officer,
including the CEO, the Committee takes into account, among other things, the
salaries paid for comparable positions at Comparable Companies, changes in the
executive officer's responsibilities, and the individual executive officer's
performance. The Committee's long-term objective is to set the base salaries
of its executive officers to roughly approximate the median salaries of
similar-level executives of the Comparable Companies.
The CEO's base salary for 1998 was $500,000. Based on a competitive analysis
of the CEO's base salary, the Committee did not adjust his base salary for
1999.
8
<PAGE>
Annual Incentive Compensation. In February 1997, PRIMEX adopted an incentive
compensation program (the "ICP") as the vehicle for awarding executive
officers annual incentive compensation. For all executive officers, other than
the Division Presidents, the ICP awards annual cash bonuses determined solely
on the basis of the EVA or Economic Value Added ("EVA") performance of PRIMEX
for the year versus a previously agreed-upon target. Seventy-five percent of
the cash bonus to each Division President is based on the EVA performance of
his respective Division; the remaining 25% is based on the EVA performance of
PRIMEX. This EVA system, which has been successfully adopted and implemented
by a wide range of public and private companies around the world, uses as its
principal measure an estimate of the net operating profit after subtracting
taxes and the cost of capital employed (including both debt and equity). The
Committee believes that the EVA system closely aligns the interests of
management and shareholders.
The EVA-based annual incentive award is calculated solely by reference to
PRIMEX's financial results and without reference to any individual's
performance. Under the EVA bonus formula, a bonus multiple is generated that
is then applied to the target bonus set at the beginning of a bonus year,
resulting in a "declared bonus" award. Under the bonus plan, the declared
bonus award is then placed into an individual's "bonus bank" from which only a
predetermined portion of the bonus bank balance is actually paid out as the
bonus award in a given year (for 1998, the predetermined payout was 40% of the
participant's bonus bank balance). The remaining bonus bank balance is
deferred, to be paid out over subsequent years if performance is sustained.
The predetermined bonus payout for 1999 will be 33 1/3% of each participant's
bonus bank balance.
The CEO's incentive compensation award is determined by the EVA performance
of PRIMEX for the year. For 1998, PRIMEX's actual EVA performance versus the
target approved by the Board substantially exceeded the goal. For 1998, the
CEO received a bonus payout of $555,961. His remaining bank balance is
$833,942, which, along with his 1999 target incentive bonus of $400,000, will
be taken into account under the EVA formula in computing his 1999 ICP award.
Long-Term Incentive Compensation. In December 1996, the Board of Directors
adopted the 1996 Long Term Incentive Plan of Primex Technologies, Inc. (the
"1996 LTIP") as the primary vehicle for making grants of long-term incentive
compensation to executive officers and other key employees of PRIMEX. By
providing for the grant of equity-based awards, the 1996 LTIP serves the
objective of creating a link between a key employee's compensation and the
long-term financial performance of PRIMEX. That is, equity-based awards enable
the executive officers and key employees who participate in the 1996 LTIP to
reap benefits when shareholder value is created. Under the 1996 LTIP, the
Committee is authorized to make grants of restricted stock, restricted stock
units (rights to receive stock in the future), stock appreciation rights, and
both qualified and non-qualified stock options.
On January 2, 1998, the Committee granted options to purchase 250,000 shares
of PRIMEX Common Stock to executive officers and key employees. As part of the
January 2, 1998 grant, the CEO was awarded options to purchase 50,000 shares
of PRIMEX Common Stock with an exercise price of $33.88 per share. The table
entitled "Option Grants of Common Stock in 1998" in this Proxy Statement sets
forth certain information regarding stock option grants to other executive
officers during 1998.
On January 4, 1999, the Committee granted options to purchase 223,000 shares
of PRIMEX Common Stock to executive officers and key employees and also
granted stock appreciation rights. The Committee currently intends that all
long-term incentive awards made in the foreseeable future will be equity-based
awards similar to those available for grant under the 1996 LTIP and currently
anticipates that such awards will be primarily in the form of stock options.
There are, however, less than 10,000 shares of PRIMEX Common Stock available
for issuance under the 1996 LTIP as restricted stock, restricted stock units
or pursuant to stock options, and accordingly, the only long-term incentive
awards currently available for grant by the Committee under the 1996 LTIP are
stock appreciation rights. The Committee anticipates that the Board of
Directors will seek shareholder approval to increase the number of shares of
PRIMEX Common Stock that may be awarded by the Committee as restricted stock,
restricted stock units and pursuant to stock options at its Annual Meeting of
Shareholders in the year 2000.
9
<PAGE>
From time to time, the Committee may award bonus compensation to an
executive officer of PRIMEX in recognition of an extraordinary contribution
made by the officer. These awards, which are infrequent and which are made
solely at the discretion of the Committee, are made on an individual basis at
such time or times as the Committee determines such awards are warranted. The
Committee is not obligated to make such awards, and the Committee did not make
any such awards in 1998.
Section 162(m) of Internal Revenue Code. Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"), limits the deductibility of
certain compensation paid to the Chief Executive Officer and the other four
most highly compensated executive officers of a public company during a
taxable year. This limitation on deductibility, which is set at $1 million per
officer, does not apply to certain types of performance-based compensation.
The Committee's philosophy with respect to Section 162(m) is that PRIMEX
should maximize the benefit of the tax laws for PRIMEX shareholders by
awarding performance-based compensation to the extent consistent with PRIMEX's
compensation policies and practices.
Conclusion. The Committee believes that the executive compensation program
described above has facilitated and will continue to facilitate PRIMEX's
ability to retain, motivate, and attract the executive resources necessary to
maximize shareholder value. The Committee intends to continue to emphasize the
variable-pay element of the compensation program and the link between
executive compensation and shareholder value.
The Compensation and Nominating Committee:
William B. Mitchell, Chairman March 2, 1999
Edwin M. Glasscock
David Lasky
Bob Martinez
10
<PAGE>
Summary Compensation Table
The following table shows for PRIMEX's Chief Executive Officer and the four
other most highly compensated executive officers of PRIMEX (the "Named
Executive Officers") compensation for fiscal years 1997 and 1998.
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation
----------------------------------- -------------------------------------
Name and Principal
Position Restricted Securities
as of December 31, Other Annual Stock Underlying All Other
1998 Year Salary Bonus Compensation Units(d) Options Compensation(e)
------------------ ---- -------- -------- ------------ ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
James G. Hascall........ 1998 $500,000 $555,961 $ 9,411 $ 0 50,000 $144,179
Chairman and Chief 1997 425,000 452,403 184,251(c) 1,046,400 0 69,237
Executive Officer
Angelo A. Catani (a).... 1998 $350,000 $815,840 $ 13,765 $ 0 10,000 $100,432
Vice Chairman........... 1997 350,000 257,100 9,548 697,600 0 63,468
J. Douglas DeMaire (b).. 1998 $350,000 $315,265 $ 9,307 $ 0 30,000 $ 71,400
Executive Vice President 1997 225,000 163,162 134,666(c) 401,120 0 32,483
Michael S. Wilson (b)... 1998 $250,000 $182,104 $ 0 $ 0 20,000 $ 52,296
Vice President.......... 1997 200,000 135,810 0 401,120 0 27,319
William W. Smith........ 1998 $250,000 $164,806 $ 2,089 $ 0 10,000 $ 63,639
Executive Vice
President.............. 1997 250,000 120,653 0 401,120 0 52,265
</TABLE>
- -------
(a) Angelo A. Catani retired as Vice Chairman effective December 31, 1998. Mr.
Catani's bonus payout is comprised of his 1998 ICP award of $326,336 and
100% of his bonus bank balance of $489,504. (For a description of ICP
awards and bonus banks, refer to the Report from the Compensation and
Nominating Committee on Executive Compensation.)
(b) Effective January 1, 1999, the Board elected J. Douglas DeMaire, President
and Michael S. Wilson, Executive Vice President.
(c) Dollar amounts shown include relocation expenses paid by Olin for Messrs.
Hascall and DeMaire of $112,346 and $84,347, respectively. Amounts also
include tax gross-ups paid for imputed income on such relocation expenses
of $40,673 for Mr. Hascall and $31,937 for Mr. DeMaire.
(d) Dollar amounts shown equals number of restricted stock units granted
multiplied by the fair market value of a share of PRIMEX Common Stock on
the grant date. The number and value of the restricted stock units held on
December 31, 1998, based on the $42.50 per share closing price of PRIMEX
Common Stock on December 31, 1998, were J. G. Hascall--60,000 units
($2,550,000), A. A. Catani--40,000 units ($1,700,000), J. D. DeMaire--
23,000 units ($977,500), M. S. Wilson--23,000 units ($977,500), W. W.
Smith--23,000 units ($977,500). Dividends are accrued on all restricted
stock units at the same rate as unrestricted shares of Common Stock and
interest is accrued on all cash balances.
(e) Amounts reported in this column for 1998 are comprised of the following
items:
<TABLE>
<CAPTION>
PRIME Plan
Company Match Restoration Term Life
and Retirement Plan (1) Insurance (2)
-------------- ----------- -------------
<S> <C> <C> <C>
J. G. Hascall.................... $18,800 $111,488 $13,891
A. A. Catani..................... 18,800 70,466 11,166
J. D. DeMaire.................... 18,110 44,326 8,964
M. S. Wilson..................... 17,283 28,650 6,363
W. W. Smith...................... 20,400 35,174 8,065
</TABLE>
- -------
(1) The Internal Revenue Code of 1986, as amended, imposes a cap on the amount
of contributions that an employer may make to tax-deferred benefit plans
on account of a particular employee. The Primex Technologies, Inc.
Restoration Bonus Plan (the "Restoration Bonus Plan") provides for cash
bonuses to each employee equal to the amount in excess of such cap that
PRIMEX would have contributed to the PRIME Plan on account of such
employee if the cap did not exist. Such bonuses accrue throughout the year
and are payable on or before December 31 of each year.
(2) Under the PRIMEX key executive life insurance program, additional life
insurance was provided in 1998 to each executive with survival income
benefits to the spouse and dependent children of deceased participants.
Amounts shown represent premiums paid under the program on behalf of such
executives during 1998.
11
<PAGE>
Option Grants of Common Stock in 1998
The following table presents additional information concerning the option
awards shown in the Summary Compensation Table on page 11 for fiscal year
1998. These options to purchase PRIMEX Common Stock were granted to the Named
Executive Officers under the 1996 LTIP.
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation
Individual Grants for Option Term (c)
- ---------------------------------------------------------------------------- ---------------------
% of Total
Number of Options
Securities Granted to
Underlying Employees
Options in Exercise Expiration
Name Date Granted (a) Fiscal Year Price (b) Date 5% 10%
- ---- ------ ----------- ----------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
J. G. Hascall........... 1/2/98 50,000 18.2 $33.88 1/1/08 $1,065,345 $2,699,800
A. A. Catani............ 1/2/98 10,000 3.6 33.88 1/1/08 213,069 539,960
J. D. DeMaire........... 1/2/98 30,000 10.9 33.88 1/1/08 639,207 1,619,880
M. S. Wilson............ 1/2/98 20,000 7.3 33.88 1/1/08 426,138 1,079,920
W. W. Smith............. 1/2/98 10,000 3.6 33.88 1/1/08 213,069 539,960
</TABLE>
- --------
(a) Consists of option grants under the 1996 LTIP. The 1996 LTIP provides for
the grant of stock options and related stock appreciation rights ("SARs"),
as well as restricted stock, to key employees, as determined by the
Compensation and Nominating Committee of the Board of Directors. Options
granted under the 1996 LTIP may be granted either as incentive stock
options, which qualify for certain favorable tax treatment, or as non-
qualified options. One-third of the options granted in 1998 becomes
exercisable on each January 1 beginning in 1999, except for Mr. Catani and
Mr. Smith whose grants, because of anticipated retirement, become
exercisable over one year and two years, respectively. PRIMEX did not
grant any SAR's in 1998.
(b) The exercise price of the options reflects the fair market value of Common
Stock on the date of grant.
(c) No gain to the optionees is possible without appreciation in the stock
price that will benefit all shareholders commensurately. The dollar
amounts under these columns are the result of calculations at the 5% and
10% assumption rates set by the SEC and therefore are not intended to
forecast possible future appreciation of PRIMEX's stock price or to
establish any present value of the options.
The following table sets forth as to the individuals named in the Summary
Compensation Table on page 11, information regarding options exercised during
1998 and the value of in-the-money outstanding options at the end of 1998.
Aggregated Option Exercises in 1998 and Year-end Option Values
<TABLE>
<CAPTION>
Number of Aggregate
Securities Underlying Value of Unexercised,
Unexercised Options In-the-Money
Shares at 12/31/98 Options at 12/31/98(a)
Acquired Value ------------------------- -------------------------
Name on Exercise Realized Unexercisable Exercisable Unexercisable Exercisable
- ---- ----------- -------- ------------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
J. G. Hascall........... 0 $ 0 50,000 0 $431,000 $ 0
A. A. Catani............ 0 0 10,000 0 86,200 0
J. D. DeMaire........... 0 0 30,000 0 258,600 0
M. S. Wilson............ 0 0 20,000 0 172,400 0
W. W. Smith............. 0 0 10,000 0 86,200 0
</TABLE>
- --------
(a) Value was computed as the difference between the exercise price and the
$42.50 per share closing price of PRIMEX Common Stock on December 31,
1998, as reported on the consolidated transaction reporting system of the
Nasdaq National Market System.
12
<PAGE>
PERFORMANCE GRAPH
Primex Technologies, Inc., the Russell 2000 Index and the Dow Jones Aerospace &
Defense Index*
<TABLE>
<CAPTION>
Cumulative Total Return
------------------------------------------------
1/2/97 3/97 6/97 9/97 12/97 3/98 6/98 9/98 12/98
------ ---- ---- ---- ----- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Primex Technologies, Inc. ..... 100 91 106 161 169 231 258 172 216
Russell 2000................... 100 95 110 127 122 135 131 105 122
DJ Aerospace & Defense......... 100 94 107 115 106 114 106 90 87
</TABLE>
- --------
* Assuming $100 invested on January 2, 1997 in Primex Common Stock on 12/31/96
in index, including reinvestment of dividends. Fiscal year ending December
31.
Executive Agreements and Change-in-Control Arrangements
Each of the Named Executive Officers are parties to Executive Agreements with
PRIMEX. Each Executive Agreement provides certain benefits to the officer in
the event that such officer's employment with PRIMEX is terminated. More
specifically, if the officer's employment is terminated by PRIMEX without
cause, the officer is entitled to a lump-sum payment equal to the sum of (i)
twelve months of the officer's then current monthly salary, plus (ii) an amount
equal to the greater of the average annual bonus payout to the officer under
PRIMEX's ICP over the three years immediately preceding the officer's
termination or the officer's then current target bonus under PRIMEX's ICP (the
aggregate amount set forth under (i) and (ii) above being referred to as the
"Executive Severance"). In the event that the officer's employment is
terminated without cause by PRIMEX or any successor entity after a change in
control of PRIMEX, the officer is entitled to an additional lump-sum payment
equal to two times the Executive Severance. The officer is also entitled to the
above amounts if he or she terminates his or her own employment after a change
in control of PRIMEX for certain specified reasons, including a reduction in
such officer's base salary, a reduction in responsibilities or position with
PRIMEX, relocation of his or her office under certain circumstances, and
failure of PRIMEX to maintain the officer's level of participation in certain
benefit plans.
Under the Executive Agreements, if an officer becomes entitled to Executive
Severance, then, in addition to such Executive Severance, the officer will be
entitled to receive a lump sum payment equal to the amount (or, in the case of
a change in control, three times the amount) contributed or credited by PRIMEX
to the officer's accounts in all defined contribution plans of PRIMEX during
the twelve months preceding the officer's
13
<PAGE>
termination. The officer will also, under certain circumstances, be
compensated for certain benefits that would be lost under Olin's qualified
pension plan as a result of the termination of the officer's employment with
PRIMEX (assuming that such officer, at the time of termination, has an accrued
vested benefit under such pension plan).
Under each Executive Agreement, the officer will also continue to enjoy
coverage under all PRIMEX medical, dental, and life insurance plans for an
additional one year after termination or, if the termination is after a change
in control, for an additional three years. Lastly, the Executive Agreements
provide that, with respect to any "excess parachute payment" tax imposed on an
officer's severance benefits by Section 4999 of the Internal Revenue Code of
1986, as amended, the officer's benefits will be grossed-up so that after-tax
severance benefits will equal what would have been received had the officer
not been subject to Section 4999. Each of the Executive Agreements expires on
December 31, 2002.
In addition to the Executive Agreements, certain of PRIMEX's benefit and
compensation plans provide for the acceleration or increase of benefits in the
event of a change in control of PRIMEX. Under the ICP, upon a change in
control of PRIMEX, all bonus bank balances are required to be paid to ICP
participants within five working days of such change in control. Under the
Restoration Bonus Plan (as described above in Footnote (c) to the Summary
Compensation Table), all bonuses for the year payable under such plan will
automatically be paid to participants upon a change in control. Under the
Directors Plan (as described above under the caption "ADDITIONAL INFORMATION
REGARDING THE BOARD OF DIRECTORS--Compensation of Directors"), upon a change
in control of PRIMEX, all shares and other amounts credited to a director's
stock and cash accounts under the Director's Plan will promptly be distributed
to such director. Under the 1996 LTIP, upon a change in control of PRIMEX, all
options and stock appreciation rights then outstanding under the 1996 LTIP
will become immediately and fully exercisable, notwithstanding any vesting
requirements contained in the 1996 LTIP or the individual grant. In addition,
each 1996 LTIP participant holding an option shall also be deemed to hold a
stock appreciation right related to such option, unless a stock appreciation
right has already been granted with respect to such option. Such stock
appreciation rights will be exercisable on the same terms and conditions as
the related option. All restrictions and conditions of all restricted stock
and restricted stock units granted under the 1996 LTIP will, upon a change in
control, be deemed satisfied as of the date of the change in control, and all
performance awards under the 1996 LTIP will become vested, deemed earned in
full, and promptly paid upon a change in control.
In the Executive Agreements and in the foregoing benefit and compensation
plans, "change in control" is defined as the occurrence of any one of the
following events: (i) PRIMEX ceases to be owned by at least 300 shareholders
of record, or ceases, by action of PRIMEX's Board of Directors, to be either
listed on a national securities exchange or authorized for quotation on the
Nasdaq Stock Market; (ii) 15% of the outstanding voting stock of PRIMEX
becomes owned by one person or entity (other than PRIMEX, a majority-owned
subsidiary of PRIMEX, or an employee benefit plan of PRIMEX or one of its
subsidiaries); (iii) the incumbent directors or their designated successors
cease, over a two-year period, to constitute a majority of the Board of
Directors; (iv) all or substantially all of PRIMEX's business or assets is
disposed of pursuant to a merger, consolidation or other transaction in which
PRIMEX is not the surviving corporation or PRIMEX combines with another
company (unless the shareholders of PRIMEX immediately preceding the
transaction own more than 50% of the voting stock or other ownership interest
in the surviving entity or combined company); or (v) PRIMEX's Board of
Directors determines that a tender offer for PRIMEX shares indicates a serious
intention by the offeror to acquire control of PRIMEX.
PROPOSAL NO. 2--RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed the firm of Ernst & Young LLP ("Ernst &
Young") as independent auditors of PRIMEX for the year 1999. The appointment
of this firm was recommended to the Board by its Audit Committee.
The submission of this matter to shareholders at the Annual Meeting is not
required by law or by PRIMEX's Bylaws. The Board of Directors of PRIMEX is,
nevertheless, submitting it to the shareholders to ascertain their views. If
this appointment is not ratified at the Annual Meeting, the Board of Directors
intends to reconsider its appointment of Ernst & Young as independent
auditors.
14
<PAGE>
A representative of Ernst & Young is expected to be present at the Annual
Meeting and will have an opportunity to make a statement if he or she desires
to do so and to respond to appropriate questions.
The ratification of the appointment of independent auditors for 1999
requires that the votes cast in favor of the ratification exceed the votes
cast opposing such ratification. Abstentions and Broker Shares that are not
voted will not be included in determining the number of votes cast.
The Board of Directors recommends a vote FOR the ratification of the
appointment
of Ernst & Young LLP as PRIMEX's independent auditors for 1999.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Anthony W. Ruggiero, a director of PRIMEX, is Executive Vice President and
Chief Financial Officer of Olin Corporation. PRIMEX and Olin have operated
under certain agreements governing their relationship since the spin-off of
PRIMEX from Olin on December 31, 1996. These agreements provided for the
allocation of tax and certain other liabilities and obligations arising from
periods prior to the spin-off. While the agreements contain terms that
generally are comparable to those that would have been reached in arms-length
negotiations with unaffiliated parties, these agreements were reached while
PRIMEX was wholly owned by Olin and therefore are not the result of arms-
length negotiations between independent parties. These agreements include a
Powder Supply Requirements Agreement and a Component Supply Agreement which
set forth the terms by which Olin purchases propellant powder from PRIMEX and
PRIMEX purchases certain ammunition components from Olin.
MISCELLANEOUS
PRIMEX will pay the entire expense of this solicitation of proxies.
Georgeson & Company Inc., New York, New York, will solicit proxies by
personal interview, mail, telephone and telegram, and will request brokerage
houses and other custodians, nominees and fiduciaries to forward solicitation
material to the beneficial owners of the Common Stock held of record by such
persons. PRIMEX will pay Georgeson & Company Inc. a fee of $6,500 covering its
services and will reimburse Georgeson & Company Inc. for payments made to
brokers and other nominees for their expenses in forwarding solicitation
material. In addition, proxies may be solicited by personal interview,
telephone and telegram by directors, officers and employees of PRIMEX.
Shareholder Proposals
Proposals of shareholders intended to be presented at PRIMEX's 2000 Annual
Meeting of Shareholders must be received at PRIMEX's principal executive
offices by November 24, 1999 for inclusion in PRIMEX's proxy statement and
form of proxy for that meeting. All such proposals must be in writing and
addressed to the Corporate Secretary, Primex Technologies, Inc., 10101 9th
Street North, St. Petersburg, FL 33716.
By order of the Board of Directors:
/s/ George H. Pain
---------------------------
George H. Pain
Secretary
March 23, 1999
15
<PAGE>
[LOGO] PRINTED ON RECYCLED PAPER
<PAGE>
PRIMEX TECHNOLOGIES, INC.
10101 9th Street N., St. Petersburg, FL 33716
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
JAMES G. HASCALL, BOB MARTINEZ, and LEON E. SALOMON, or any of them, with
full power of substitution, are hereby appointed proxies to vote all Common
Stock of the undersigned in Primex Technologies, Inc. which the undersigned
would be entitled to vote on all matters which may come before the Annual
Meeting of Shareholders to be held at the Hyatt Regency Westshore, 6200 Courtney
Campbell Causeway, Tampa, Florida, on May 4, 1999, at 10:00 a.m. and at any
adjournment.
This Proxy will be voted as directed by the shareholder on the items listed
on the reverse side. If no contrary direction is specified, this Proxy will be
voted FOR Items 1 and 2. Should any nominee for election to the Board of
Directors be unable to serve, this Proxy may be voted for a substitute selected
by the Board of Directors.
- --------------------------------------------------------------------------------
Comments/Address Change: Please mark box on reverse side
- --------------------------------------------------------------------------------
PLEASE COMPLETE AND SIGN THIS PROXY ON THE REVERSE SIDE, WHERE IT IS CONTINUED,
THEN RETURN IT IN THE ENCLOSED ENVELOPE.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE>
Please mark
your votes as [X]
indicated in
this example
The Board of Directors recommends
a vote FOR Items 1 and 2.
FOR Withheld
(except as For All
noted below)
Item 1--Election of DIRECTORS
Nominees: [ ] [ ]
J. Douglas DeMaire
James G. Hascall
David Lasky
William B. Mitchell
WITHHELD FOR: (Write that nominee's name in the space provided below).
- --------------------------------------------------------------------
FOR AGAINST ABSTAIN
Item 2--APPOINTMENT OF INDEPENDENT [ ] [ ] [ ]
AUDITORS
WILL ATTEND MEETING Yes No
[ ] [ ]
COMMENTS/ADDRESS CHANGE [ ] [ ]
(use space on reverse side)
Signature(s)_______________________________ Date:_______________________
NOTE: Please sign as name appears hereon. Joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full title as such.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE>
<TABLE>
<S> <C>
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE
The Board of Directors recommends a vote FOR Items 1 and 2.
[LOGO] PRIMEX/TM/
TECHNOLOGIES 1. Election of Directors: For All With- For All
Nominees hold Except*
OLIN CORPORATION J. Douglas DeMaire
CONTRIBUTING EMPLOYEES OWNERSHIP PLAN James G. Hascall
VOTING INSTRUCTION CARD David Lasky [ ] [ ] [ ]
William B. Mitchell
*NOTE: If you do not wish your shares voted "For" a
particular nominee, mark the "For All Except" box and write
the name(s) of the nominee(s) in the space provided below.
Your shares will be voted for the remaining nominee(s).
-------------------------------------------------------------
For Against Abstain
2. Ratification of appointment of [ ] [ ] [ ]
independent auditors.
Mark box at right if a comment
has been noted on the reverse side of this card. [ ]
_____________________
Please be sure to sign and date this Voting Instruction |Date| |
Card |
- -----------------------------------------------------------------------------| PLEASE MARK, DATE, SIGN EXACTLY AS YOUR NAME APPEARS
| HEREON, AND RETURN THIS FORM IN THE ENCLOSED ENVELOPE
| TO BOSTON EQUISERVE, PROXY TABULATION DEPT., P.O. BOX
- ---------Particpant sign here------------------------------------------------| 9389, BOSTON, MA 02205-9975.
DETACH CARD DETACH CARD
</TABLE>
To: Participants in the Primex Technologies, Inc. Retirement Investment
Management Experience Plan ("PRIME Plan")
Subject: Annual Meeting of Shareholders of Primex Technologies, Inc. ("PRIMEX")
Wachovia serves as Trustee of the Olin Corporation Contributing Employees
Ownership Plan. As a participant in the CEOP, you are entitled to instruct
Wachovia, as Trustee, how to vote the shares of Common Stock of PRIMEX allocated
to your account at the annual meeting of shareholders of PRIMEX to be held on
May 4, 1999. Your instructions shall also determine how allocated shares for
Which no instructions are received are voted.
YOUR INSTRUCTIONS ARE IMPORTANT. YOU SHOULD MARK AND RETURN THE ATTACHED VOTING
INSTRUCTION CARD ("INSTRUCTION CARD") TO THE TRUSTEE. YOUR INSTRUCTION CARD
MUST BE RETURNED SO THAT IT WILL BE RECEIVED BY WACHOVIA NO LATER THAN THE CLOSE
OF BUSINESS (5:00 PM EDT) ON APRIL 30, 1999. YOUR INSTRUCTIONS TO THE TRUSTEE
WILL BE CONFIDENTIAL.
The Proposals
The proposals before the shareholders PRIMEX are the election of the Board of
Directors and the ratification of the appointment of auditors. The proposed
candidates for the Board and the other proposal are more fully described in the
accompanying proxy material. The Board of Directors of PRIMEX recommends that
you vote in favor of both proposals.
Assuming a quorum is present at the annual meeting, the candidates for the Board
receiving the highest vote totals will be elected to the Board of Directors of
PRIMEX. All other matters voted on will be decided by a majority vote of the
shares cast at the annual meeting.
Instruction Procedures
You should mark the Instruction Card to indicate whether you want Wachovia to
vote in favor of all of the candidates or vote against the candidates. You
should also mark the card to direct Wachovia regarding the other issue before
the shareholders. You should return the card in the enclosed postage-paid
envelope.
(continued on the reverse)
<PAGE>
CONFIDENTIAL VOTING INSTRUCTIONS
- --------------------------------------------------------------------------------
TO WACHOVIA BANK, N.A. AS TRUSTEE ("TRUSTEE")
UNDER THE OLIN CORPORATION CONTRIBUTING EMPLOYEES OWNERSHIP PLAN ("CEOP")
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
I hereby instruct the Trustee to vote in person, or by proxy, all Common Stock
of Primex Technologies, Inc. ("PRIMEX") credited to my account as of the record
date which I am entitled to vote under the CEOP at the Annual Meeting of
Shareholders of PRIMEX to be held on May 4, 1999, and at any adjournment, (a) on
the following matters as indicated on the reverse side hereof, if contrary
choice is not indicated, then FOR Items 1 and 2 and (b) on any other matter
which may properly come before the meeting.
- --------------------------------------------------------------------------------
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE ENCLOSED
ENVELOPE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Please sign exactly as your name appears on the reverse side. The CEOP provides
that Common Stock credited to participants' accounts for which no written
instruction is received by the Trustee before the meeting date will be voted in
the same proportion as shares of Common Stock for which the Trustee has received
instructions. This form constitutes a direction to so vote.
- --------------------------------------------------------------------------------
DO YOU HAVE ANY COMMENTS?
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(continued from the reverse)
If you return your Instruction Card and later change your mind, you may submit a
new Instruction Card. If Wachovia receives more than one Instruction Card from
you, the most recently dated card will completely supersede any previously dated
card that Wachovia has received from you. Moreover, a dated card will always
supersede any undated card. If Wachovia receives two or more cards from you
bearing the same date with differing votes, then with respect to the matters on
which they differ, Wachovia will disregard your cards. If you sign your
Instruction Card and return it unmarked for any proposal, Wachovia will vote
your allocated shares FOR that proposal.
If you fail to return an Instruction Card, the shares allocated to your account
will be voted as explained below. A new Instruction Card may be obtained from
Wachovia by calling (336) 770-7064. If proposals other than those listed on the
Instruction Card are presented at the annual meeting, Wachovia will vote all
shares of PRIMEX held by the CEOP in its discretion on those proposals.
The legal documents require Wachovia, as Trustee, to vote all allocated shares
of PRIMEX Common Stock according to the instructions from the participants. In
addition, the legal documents provide that any fractional, unvoted or
unallocated shares shall be voted by the Trustee in the same proportion as the
shares voted by the participants.
Wachovia's Legal Responsibilities
For each proposal, Wachovia will vote shares of PRIMEX Common Stock according to
your instructions on your most recent Instruction Card if that card has been
properly marked and signed.
Otherwise, for each proposal Wachovia will vote shares of PRIMEX Common Stock as
explained above for which (i) no Instruction Card is received or (ii) the most
recent signed Instruction Card received is not properly marked, unless doing so
would not be consistent with the provisions of Title I of the Employee
Retirement Income Security Act ("ERISA").
If following these rules for voting allocated shares for which no Instruction
Card is received or for which the most recent signed Instruction Card received
is not properly marked would lead to an imprudent result (keeping in mind that,
in many situations, more than one result may be prudent), then Wachovia must
vote such shares of Common Stock of PRIMEX as Wachovia believes prudent.
Wachovia will follow these rules unless it has well-founded reasons why doing so
would not be prudent or otherwise not consistent with Title I of ERISA.
Confidentiality
Your Instruction Card is CONFIDENTIAL. Your instructions will be known only by
Wachovia. If you have any questions about the procedures, you may contact
Wachovia at (336) 770-7064.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Delivery
By Regular Mail By Hand Delivery By Express Mail
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Boston EquiServe Boston EquiServe Boston EquiServe
Proxy Tabulation Department Proxy Tabulation Department Proxy Tabulation Department
P.O. Box 9389 150 Royall Street 150 Royall Street
Boston, MA 02205-9975 Canton, MA 02021-1031 Mail Stop: 45-70-10
Canton, MA 02021-1031
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<S> <C>
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE
The Board of Directors recommends a vote FOR Items 1 and 2.
[LOGO] PRIMEX/TM/
TECHNOLOGIES 1. Election of Directors: For All With- For All
Nominees hold Except*
PRIMEX TECHNOLOGIES, INC. J. Douglas DeMaire
RETIREMENT INVESTMENT MANAGEMENT EXPERIENCE PLAN James G. Hascall
VOTING INSTRUCTION CARD David Lasky [ ] [ ] [ ]
William B. Mitchell
*NOTE: If you do not wish your shares voted "For" a
particular nominee, mark the "For All Except" box and write
the name(s) of the nominee(s) in the space provided below.
Your shares will be voted for the remaining nominee(s).
-------------------------------------------------------------
For Against Abstain
2. Ratification of appointment of [ ] [ ] [ ]
independent auditors.
Mark box at right if a comment
has been noted on the reverse side of this card. [ ]
_____________________
Please be sure to sign and date this Voting Instruction |Date| |
Card |
- -----------------------------------------------------------------------------| PLEASE MARK, DATE, SIGN EXACTLY AS YOUR NAME APPEARS
| HEREON, AND RETURN THIS FORM IN THE ENCLOSED ENVELOPE
| TO BOSTON EQUISERVE, PROXY TABULATION DEPT., P.O. BOX
- ---------Particpant sign here------------------------------------------------| 9389, BOSTON, MA 02205-9975.
DETACH CARD DETACH CARD
</TABLE>
To: Participants in the Primex Technologies, Inc. Retirement Investment
Management Experience Plan ("PRIME Plan")
Subject: Annual Meeting of Shareholders of Primex Technologies, Inc. ("PRIMEX")
Wachovia serves as Trustee of the Primex Technologies, Inc. Retirement
Investment Management Experience Plan. As a participant in the PRIME Plan, you
are entitled to instruct Wachovia, as Trustee, how to vote the shares of Common
Stock of PRIMEX allocated to your account at the annual meeting of shareholders
of PRIMEX to be held on May 4, 1999. Your instructions shall also determine how
allocated shares for which no instructions are received are voted.
YOUR INSTRUCTIONS ARE IMPORTANT. YOU SHOULD MARK AND RETURN THE ATTACHED VOTING
INSTRUCTION CARD ("INSTRUCTION CARD") TO THE TRUSTEE. YOUR INSTRUCTION CARD
MUST BE RETURNED SO THAT IT WILL BE RECEIVED BY WACHOVIA NO LATER THAN THE CLOSE
OF BUSINESS (5:00 PM EDT) ON APRIL 30, 1999. YOUR INSTRUCTIONS TO THE TRUSTEE
WILL BE CONFIDENTIAL.
The Proposals
The proposals before the shareholders PRIMEX are the election of the Board of
Directors and the ratification of the appointment of auditors. The proposed
candidates for the Board and the other proposal are more fully described in the
accompanying proxy material. The Board of Directors of PRIMEX recommends that
you vote in favor of both proposals.
Assuming a quorum is present at the annual meeting, the candidates for the Board
receiving the highest vote totals will be elected to the Board of Directors of
PRIMEX. All other matters voted on will be decided by a majority vote of the
shares cast at the annual meeting.
Instruction Procedures
You should mark the Instruction Card to indicate whether you want Wachovia to
vote in favor of all of the candidates or vote against the candidates. You
should also mark the card to direct Wachovia regarding the other issue before
the shareholders. You should return the card in the enclosed postage-paid
envelope.
(continued on the reverse)
<PAGE>
CONFIDENTIAL VOTING INSTRUCTIONS
- --------------------------------------------------------------------------------
TO WACHOVIA BANK, N.A. AS TRUSTEE ("TRUSTEE")
UNDER THE PRIMEX TECHNOLOGIES, INC. RETIREMENT INVESTMENT MANAGEMENT EXPERIENCE
PLAN ("PRIME PLAN")
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
I hereby instruct the Trustee to vote in person, or by proxy, all Common Stock
of Primex Technologies, Inc. ("PRIMEX") credited to my account as of the record
date which I am entitled to vote under the PRIME Plan at the Annual Meeting of
Shareholders of PRIMEX to be held on May 4, 1999, and at any adjournment, (a) on
the following matters as indicated on the reverse side hereof or, if contrary
choice is not indicated, then FOR Items 1 and 2 and (b) on any other matter
which may properly come before the meeting.
- --------------------------------------------------------------------------------
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE ENCLOSED
ENVELOPE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Please sign exactly as your name appears on the reverse side. The PRIME Plan
provides that Common Stock credited to participants' accounts for which no
written instruction is received by the Trustee before the meeting date will be
voted in the same proportion as shares of Common Stock for which the Trustee has
received instructions. This form constitutes a direction to so vote.
- --------------------------------------------------------------------------------
DO YOU HAVE ANY COMMENTS?
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(continued from the reverse)
If you return your Instruction Card and later change your mind, you may submit a
new Instruction Card. If Wachovia receives more than one Instruction Card from
you, the most recently dated card will completely supersede any previously dated
card that Wachovia has received from you. Moreover, a dated card will always
supersede any undated card. If Wachovia receives two or more cards from you
bearing the same date with differing votes, then with respect to the matters on
which they differ, Wachovia will disregard your cards. If you sign your
Instruction Card and return it unmarked for any proposal, Wachovia will vote
your allocated shares FOR that proposal.
If you fail to return an Instruction Card, the shares allocated to your account
will be voted as explained below. A new Instruction Card may be obtained from
Wachovia by calling (336) 770-7064. If proposals other than those listed on the
Instruction Card are presented at the annual meeting, Wachovia will vote all
shares of PRIMEX held by the PRIME Plan in its discretion on those proposals.
The legal documents require Wachovia, as Trustee, to vote all allocated shares
of PRIMEX Common Stock according to the instructions from the participants. In
addition, the legal documents provide that any fractional, unvoted or
unallocated shares shall be voted by the Trustee in the same proportion as the
shares voted by the participants.
Wachovia's Legal Responsibilities
For each proposal, Wachovia will vote shares of PRIMEX Common Stock according to
your instructions on your most recent Instruction Card if that card has been
properly marked and signed.
Otherwise, for each proposal Wachovia will vote shares of PRIMEX Common Stock as
explained above for which (i) no Instruction Card is received or (ii) the most
recent signed Instruction Card received is not properly marked, unless doing so
would not be consistent with the provisions of Title I of the Employee
Retirement Income Security Act ("ERISA").
If following these rules for voting allocated shares for which no
Instruction Card is received or for which the most recent signed Instruction
Card received is not properly marked would lead to an imprudent result (keeping
in mind that, in many situations, more than one result may be prudent), then
Wachovia must vote such shares of Common Stock of PRIMEX as Wachovia believes
prudent. Wachovia will follow these rules unless it has well-founded reasons
why doing so would not be prudent or otherwise not consistent with Title I of
ERISA.
Confidentiality
Your Instruction Card is CONFIDENTIAL. Your instructions will be known only by
Wachovia. If you have any questions about the procedures, you may contact
Wachovia at (336) 770-7064.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------
Delivery
By Regular Mail By Hand Delivery By Express Mail
- -----------------------------------------------------------------------------------------------
<S> <C> <C>
Boston EquiServe Boston EquiServe Boston EquiServe
Proxy Tabulation Department Proxy Tabulation Department Proxy Tabulation Department
P.O. Box 9389 150 Royall Street 150 Royall Street
Boston, MA 02205-9975 Canton, MA 02021-103 Mail Stop: 45-70-10
Canton, MA 02021-1031
- -----------------------------------------------------------------------------------------------
</TABLE>
