SCHEDULE 14A
(Rule 14a-101)
Information Required in Proxy Statement
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:
<TABLE>
<CAPTION>
<S> <C>
[ ] 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 Rule 14a-
11(c) or Rule 14a-12
</TABLE>
UNIVERSAL CORPORATION
- --------------------------------------------------------------------------------
(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)(1) 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:
.................................................................
<PAGE>
[ ] 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:
....................................................................
<PAGE>
[Universal Corporation Logo]
--------------
ANNUAL MEETING OF SHAREHOLDERS
--------------
September 24, 1999
Dear Shareholder:
You are cordially invited to attend the 1999 Annual Meeting of
Shareholders of Universal Corporation, which is to be held in the Company's
Headquarters Building located at 1501 North Hamilton Street, Richmond, Virginia,
on Tuesday, October 26, 1999, commencing at 2:00 p.m. At the meeting, you will
be asked to elect three Directors to serve three-year terms, one Director to
serve a two-year term and one Director to serve a one-year term, and to approve
the Universal Corporation Executive Officer Annual Incentive Plan.
Whether or not you plan to attend the meeting, it is important that
your shares be represented and voted at the meeting. Therefore, you are
requested to complete, sign, date and mail your proxy promptly in the enclosed
postage-paid envelope.
Sincerely,
/s/ Henry H. Harrell
HENRY H. HARRELL
Chairman and Chief
Executive Officer
<PAGE>
Universal Corporation
P.O. Box 25099
Richmond, Virginia 23260
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The Annual Meeting of Shareholders of Universal Corporation (the
"Company") will be held in the Company's Headquarters Building located at 1501
North Hamilton Street, Richmond, Virginia, on Tuesday, October 26, 1999, at 2:00
p.m., for the following purposes:
(1) To elect three Directors to serve three-year terms, one
Director to serve a two-year term and one Director to serve a
one-year term;
(2) To approve the Universal Corporation Executive Officer Annual
Incentive Plan; and
(3) To act upon such other matters as may properly come before the
meeting or any adjournments thereof.
Only holders of record of shares of the Company's Common Stock at the
close of business on September 7, 1999, shall be entitled to vote at the
meeting.
Please sign and promptly mail the enclosed proxy to insure the presence
of a quorum at the meeting.
By Order of the Board of Directors,
James M. White, III
Secretary
September 24, 1999
<PAGE>
PROXY STATEMENT
The enclosed proxy is solicited by the Board of Directors of the
Company. A shareholder may revoke the proxy at any time prior to its use, but
proxies properly executed and received by the Secretary prior to the Annual
Meeting, and not revoked, will be voted in accordance with the shareholder's
instructions. The proxy confers discretionary authority on the persons named
therein to vote in accordance with the Board's recommendations on any matter for
which the shareholder has not provided voting instructions.
The Company will pay all of the costs associated with the proxy
solicitation. Proxies are being solicited by mail and may also be solicited in
person or by telephone, telegraph, telefacsimile or other means of electronic
transmission by Directors, officers and employees of the Company. The Company
will reimburse banks, brokerage firms, and other custodians, nominees and
fiduciaries for their reasonable expenses in forwarding proxy materials to the
beneficial owners of the shares of the Company's Common Stock. It is
contemplated that additional solicitation of proxies will be made by D. F. King
& Co., Inc., 77 Water Street, New York, New York 10005, at an anticipated cost
to the Company of approximately $4,000, plus reimbursement of out-of-pocket
expenses.
This Proxy Statement will be mailed to registered holders of the
Company's Common Stock on or about September 24, 1999.
VOTING RIGHTS
The Company had outstanding, as of September 7, 1999, 31,500,980 shares
of Common Stock, each of which is entitled to one vote per share. A majority of
the shares entitled to vote, represented in person or by proxy, will constitute
a quorum for the transaction of business at the Annual Meeting. Only
shareholders of record at the close of business on September 7, 1999, will be
entitled to vote.
The Company is not aware of any matters that are to come before the
meeting other than those described in this Proxy Statement. However, if other
matters do properly come before the meeting, it is the intention of the persons
named in the enclosed proxy card to exercise the discretionary authority
conferred by the proxy to vote such proxy in accordance with their best
judgment.
Proposal One
ELECTION OF DIRECTORS
Three Directors are to be elected at the 1999 Annual Meeting for terms
of three years, one Director is to be elected for a term of two years and one
Director is to be elected for a term of one year. Five other Directors have been
elected to terms expiring in 2001 or 2000, as indicated below. The following
pages set forth certain information for each nominee and each incumbent Director
as of June 30, 1999. All of the nominees and incumbent Directors listed below
were previously elected Directors by the shareholders.
<PAGE>
The election of each nominee for Director requires the affirmative vote
of the holders of a plurality of the shares of Common Stock cast in the election
of Directors. Votes that are 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. Unless otherwise specified in the
accompanying form of proxy, it is intended that votes will be cast for the
election of all of the nominees as Directors. If, at the time of the Annual
Meeting, any nominee should be unavailable to serve as a Director, it is
intended that votes will be cast, pursuant to the enclosed proxy, for such
substitute nominee as may be nominated by the Board of Directors. Each nominee
has consented to being named in the Proxy Statement and to serve if elected.
Nominees for Election for Terms Expiring in 2002
WILLIAM W. BERRY, 67, retired as Chairman of the Board of Directors of
Dominion Resources, Inc. (public utility holding company) on December 30, 1992.
Thereafter, he served as an independent consultant until June 1997, when he
became Chairman of the Board of New England Independent System Operator
(regional manager of electric bulk power generation and transmission systems).
Mr. Berry is a Director of Ethyl Corporation. He is Chairman of the Executive
Compensation Committee and a member of the Executive Committee and the Pension
Investment Committee. Mr. Berry has been a Director since 1986.
RONALD E. CARRIER, 67, is Chancellor of James Madison University. Prior
to September 11, 1998, he was President of James Madison University, a position
he held for more than five years. Dr. Carrier is Chairman of the Audit Committee
and a member of the Executive Compensation Committee. He has been a Director
since 1979.
HUBERT R. STALLARD, 62, is President and Chief Executive Officer of
Bell Atlantic-Virginia, Inc. (telecommunications), a position he has held for
more than five years. He is a Director of Trigon Healthcare, Inc. and Bell
Atlantic-Virginia, Inc. Mr. Stallard is Chairman of the Pension Investment
Committee and a member of the Audit Committee. He has been a Director since
1991.
Nominee for Election for Term Expiring in 2001
RICHARD G. HOLDER, 68, retired as Chairman of the Board and Chief
Executive Officer of Reynolds Metals Company on October 1, 1996. He is a
Director of Corn Products International, Inc. and Bestfoods. Mr. Holder is a
member of the Executive Committee and the Executive Compensation Committee and
has been a Director since 1992.
Nominee for Election for Term Expiring in 2000
LAWRENCE S. EAGLEBURGER, 69, is Senior Foreign Policy Advisor to the
law firm of Baker, Donelson, Bearman & Caldwell, a position he has held for more
than five years. He served as United States Secretary of State from December
1992 through January 1993, Acting Secretary of State from August 1992 to
December 1992, and Deputy Secretary of State from February 1989 to August 1992.
Mr. Eagleburger is a Director of Phillips Petroleum Company
-2-
<PAGE>
and Halliburton Company. He is a member of the Audit Committee and has been a
Director since 1993.
The Board of Directors recommends that the shareholders vote for the
nominees set forth above.
Incumbent Directors Whose Terms Expire in 2001
CHARLES H. FOSTER, JR., 56, is Chairman and Chief Executive Officer of
LandAmerica Financial Group, Inc. (title insurance holding company) and of
Lawyers Title Insurance Corporation, positions he has held for more than five
years. He is a Director of LandAmerica Financial Group, Inc. Mr. Foster is a
member of the Finance Committee and the Pension Investment Committee. He has
been a Director since 1995.
ALLEN B. KING, 53, is President and Chief Operating Officer of the
Company and of Universal Leaf Tobacco Company, Incorporated ("Universal Leaf"),
a subsidiary of the Company, positions he has held for more than five years. He
is Chairman of the Finance Committee and a member of the Executive Committee.
Mr. King has been a Director since 1989.
JEREMIAH J. SHEEHAN, 60, is Chairman of the Board and Chief Executive
Officer of Reynolds Metals Company (aluminum and other products). From 1994 to
October 1996, he was President and Chief Operating Officer of Reynolds Metals
Company. Mr. Sheehan is a Director of Reynolds Metals Company and International
Paper Company. He is a member of the Audit Committee and the Finance Committee
and has been a Director since 1998.
Incumbent Directors Whose Terms Expire in 2000
JOSEPH C. FARRELL, 63, retired as Chairman, President and Chief
Executive Officer of The Pittston Company (coal, mineral products,
transportation and security services) on March 1, 1998. He is a Director of ASA
Limited. Mr. Farrell is a member of the Audit Committee, the Finance Committee
and the Pension Investment Committee. He has been a Director since 1996.
HENRY H. HARRELL, 60, is Chairman and Chief Executive Officer of the
Company and of Universal Leaf, positions he has held for more than five years.
He is Chairman of the Executive Committee and a member of the Finance Committee.
Mr. Harrell has been a Director since 1984.
STOCK OWNERSHIP
The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock by (i) each Director or
nominee, (ii) each executive officer listed in the Summary Compensation Table
(the "Named Executive Officers"), (iii) all Directors and executive officers as
a group and (iv) each person or group known by the Company to beneficially own
more than 5% of the outstanding shares of the Company's Common Stock.
-3-
<PAGE>
<TABLE>
<CAPTION>
Name of Beneficial Owner Number of Shares 1,2,3 Percent of Class
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
William W. Berry 8,879 *
Ronald E. Carrier 10,400 *
Lawrence S. Eagleburger 7,200 *
Joseph C. Farrell 12,100 *
Charles H. Foster, Jr. 7,500 *
Henry H. Harrell 98,474 *
Richard G. Holder 8,100 *
Allen B. King 59,756 *
Hartwell H. Roper 44,937 *
Jeremiah J. Sheehan 2,700 *
Hubert R. Stallard 8,474 *
William L. Taylor 28,235 *
Jack M.M. van de Winkel 17,500 *
All Directors and executive officers
as a group (15 persons) 354,279 1.10%
Ross Financial Corporation 1,725,800 4 5.28%
P.O. Box 31363-SMB
Grand Cayman, Cayman Islands, B.W.I.
and
W.A. Dart Foundation
500 Hogsback Road
Mason, MI 48854
- -----------------
</TABLE>
*Percentage of ownership is less than 1% of the outstanding shares of
Common Stock of the Company.
1 Except as otherwise noted, the number of shares of Common Stock of
the Company shown in the table is as of June 30, 1999.
2 The number of shares of Common Stock of the Company shown in the
table does not include shares that certain officers of the Company may acquire
upon the exercise of stock options that, except under extraordinary
circumstances, are automatically exercisable at not less than six month
intervals when at least a minimum stock price appreciation has occurred.
3 The number of shares of Common Stock of the Company shown in the
table includes 141,937 shares held for certain Directors and executive officers
in the Employees' Stock Purchase Plan of Universal Leaf and 69,500 shares that
certain Directors and executive officers of the Company have the right to
acquire through the exercise of stock options within 60 days following June 30,
1999. The number of shares also includes 1,250 shares that are jointly or solely
held by minor children or other children living at home or held in fiduciary
capacities. Such shares may be deemed to be beneficially owned by the rules of
the Securities and Exchange
-4-
<PAGE>
Commission but inclusion of the shares in the table does not constitute
admission of beneficial ownership.
The Employees' Stock Purchase Plan of Universal Leaf held 1,268,206
shares or 3.95% of the shares of Common Stock outstanding on June 30, 1999. Each
participant in the plan has the right to instruct Norwest Bank Minnesota, N.A.,
trustee for the plan, with respect to the voting of shares allocated to his or
her account. The trustee, however, will vote any shares for which it receives no
instructions in the same proportion as those shares for which it has received
instructions.
4 The number of shares shown in the table is the total number of shares
reported in a Schedule 13G filed jointly by Ross Financial Corporation and W.A.
Dart Foundation with the Securities and Exchange Commission on July 9, 1999.
According to the Schedule 13G, Ross Financial Corporation has sole power to vote
and to dispose of 1,368,500 of the shares and W.A. Dart Foundation has sole
power to vote and to dispose of 357,300 of the shares.
Section 16(a) Beneficial Ownership Reporting Compliance
The Company's Directors and executive officers are required under
Section 16(a) of the Securities Exchange Act of 1934, as amended, to file
reports of ownership and changes in ownership of Common Stock of the Company
with the Securities and Exchange Commission and the New York Stock Exchange.
Copies of those reports must also be furnished to the Company.
Based solely on a review of the copies of reports furnished to the
Company and the written representations of its Directors and executive officers,
the Company believes that during the preceding fiscal year all filing
requirements applicable to Directors and executive officers were satisfied,
except that Dr. Carrier filed a Form 4 five days late reporting shares of Common
Stock he purchased in May 1999.
COMMITTEES
The standing committees of the Board of Directors are the Executive
Committee, the Finance Committee, the Audit Committee, the Pension Investment
Committee and the Executive Compensation Committee. There is no nominating
committee. The Executive Committee has the authority to act for the Board of
Directors on most matters during the intervals between Board meetings. The
Finance Committee has the responsibility of establishing the financial policies
of the Company and its subsidiaries. The responsibilities of the Audit Committee
include the review of the scope and the results of the work of the independent
public accountants and internal auditors, the review of the adequacy of internal
accounting controls and the recommendation to the Board of Directors as to the
selection of independent public accountants. The Pension Investment Committee
establishes the pension investment policies, selects investment advisors and
monitors the performance of pension investments of the Company and its U.S.
subsidiaries. After receiving recommendations from the Chief Executive Officer,
the Executive Compensation Committee fixes the compensation of officers and
makes awards under the Company's incentive compensation plans.
-5-
<PAGE>
During the fiscal year ended June 30, 1999, there were five meetings of
the Board of Directors, nine meetings of the Executive Committee, two meetings
of the Finance Committee, four meetings of the Audit Committee, four meetings of
the Pension Investment Committee and one meeting of the Executive Compensation
Committee. All Directors attended 75% or more of the total number of meetings of
the Board of Directors and all committees of the Board on which they served,
except Mr. Eagleburger who was only able to attend 67% of such meetings because
of his service as Chairman of the Commission on Holocaust Era Insurance Claims.
DIRECTORS' COMPENSATION
Each Director who is not an officer of the Company receives an annual
retainer of $18,000, a fee of $1,000 for each Board meeting attended and a fee
of $1,000 for each committee meeting attended.
The Outside Directors' 1994 Deferred Income Plan (the "Directors' DIP")
permits a non-employee Director to defer all or a portion of his compensation.
Deferred amounts are deemed hypothetically invested as designated by the
Director in certain investment options offered by the Company. In 1998, the
Directors' DIP was amended to add a Deferred Stock Unit Fund to the investment
options available under the plan. Each Deferred Stock Unit represents a
hypothetical share of the Company's Common Stock and fluctuates in value with
the market price of the stock. The portion of a Director's Deferral Account
which is invested in the Deferred Stock Unit Fund is increased by the number of
Deferred Stock Units which could be purchased with Common Stock dividends paid
by the Company. With respect to investment options other than the Deferred Stock
Unit Fund, the Company may, but is not required to, invest the deferred amounts
in a Company-owned life insurance product with parallel investment options.
Subject to certain restrictions, the Director may elect at the time of deferral
to take cash distributions, in whole or in part, from his Deferral Account
either prior to or following termination of service.
Pursuant to the Restricted Stock Plan for Non-Employee Directors and
the 1997 Executive Stock Plan, each non-employee Director is awarded 700 shares
of restricted Common Stock of the Company annually following the Annual Meeting
of Shareholders. No Director may receive in the aggregate more than 2,100 shares
of restricted Common Stock under these plans. The restrictions lapse in the
event the Director becomes disabled, dies, is not nominated for reelection or is
not reelected. The number of shares issued to non-employee Directors will be
adjusted for stock dividends, stock splits and certain other corporate events
that may occur in the future.
Under the 1994 Stock Option Plan for Non-Employee Directors (the
"Directors' Option Plan"), each non-employee Director receives an option to
purchase 1,000 shares of Common Stock of the Company on the first business day
following the Annual Meeting of Shareholders. The exercise price of all options
granted under the Directors' Option Plan is the fair market value of the Common
Stock on the date of grant. All of the options become exercisable six months
after the date of grant and expire ten years from the date of grant. Shorter
expiration periods may apply in the event an optionee dies, becomes disabled or
resigns from or does not stand for reelection to the Board. A total of 100,000
shares of Common Stock of the Company is
-6-
<PAGE>
authorized for issuance under the Directors' Option Plan, and the number of
shares authorized and issued under the Plan will be adjusted for stock
dividends, stock splits and certain other corporate events that may occur in the
future.
As part of its overall program of charitable giving, the Company offers
the Directors participation in a Directors' Charitable Contribution Program. The
Program is funded by life insurance policies purchased by the Company on the
Directors. The Directors derive no financial or tax benefits from the Program,
because all insurance proceeds and charitable tax deductions accrue solely to
the Company. However, following the death of a Director, the Company will donate
up to $1,000,000 to one or more qualifying charitable organizations recommended
by that Director. The donation(s) will be made by the Company in ten equal
annual installments, with the first installment to be made at the later of the
Director's retirement from the Board or age 70; the remaining nine installments
will be paid annually beginning immediately after the Director's death.
Each Director is also eligible to participate in a Directors' Matching
Gifts Program in which the Company matches Directors' contributions to
charities. The maximum amount which can be matched in any fiscal year is $5,000
per Director.
REPORT OF EXECUTIVE COMPENSATION COMMITTEE
The Company's executive compensation and benefits program is
administered by the Executive Compensation Committee (the "Committee"), which is
composed entirely of non-employee Directors. The goal of the program is to
attract, motivate, reward and retain the management talent required to achieve
the Company's business objectives, at compensation levels that are fair and
equitable and competitive with those of comparable companies. This goal is
furthered by the Committee's policy of linking compensation to individual and
corporate performance and by encouraging significant stock ownership by senior
management in order to align the financial interests of management with those of
the shareholders.
The three main components of the Company's executive compensation
program are base salary, annual cash incentive awards under Management
Performance Plans adopted by the Company and its subsidiaries and equity
participation usually in the form of stock option grants and eligibility to
participate in the Employees' Stock Purchase Plan of Universal Leaf. Each year
the Committee reviews the total compensation package of executive officers to
ensure they meet the goals of the program. As a part of this review, the
Committee considers corporate performance information, compensation survey data,
the advice of consultants and the recommendations of management.
Base Salary. Base salaries for executive officers are reviewed annually
to determine whether adjustments may be necessary. Factors considered by the
Committee in determining base salaries for executive officers include personal
performance of the executive in light of individual levels of responsibility,
the overall performance and profitability of the Company during the preceding
year, economic trends that may be affecting the Company, and the competitiveness
of the executive's salary with the salaries of executives in comparable
positions at companies of comparable size or operational characteristics. Each
factor is weighed by the
-7-
<PAGE>
Committee in a subjective analysis of the appropriate level of compensation for
that executive. For purposes of assessing the competitiveness of salaries, the
Committee reviews compensation data from national surveys and selected groups of
companies with similar size or operational characteristics to determine ranges
of total compensation and the individual components of such compensation. Such
compensation data indicates that the Company's salary levels are below the
median of such data when compared to executive positions of similar scope and
responsibility.
Mr. Harrell became the Chief Executive Officer of the Company in 1988
and Chairman of the Board of Directors in 1991 and has 33 years experience with
the Company. For the fiscal year beginning July 1, 1999, Mr. Harrell's base
salary was increased approximately 4% after a thorough review and evaluation by
the Committee of the competitiveness of Mr. Harrell's salary to those of other
chief executive officers of comparable companies.
Annual Cash Incentives. The Company and its principal subsidiaries have
Management Performance Plans under which key management employees may receive
annual cash incentive awards which vary from year to year based upon corporate,
business unit and individual performance. At the Committee's discretion, annual
awards based on management's recommendations are paid to eligible executives
from a "performance fund" determined primarily by the Company's pre-tax income
and after-tax return on equity. For the 1998 fiscal year, with respect to the
Named Executive Officers based in the United States, the bonus awards were based
on the change in economic profit from the 1997 level, where economic profit is
defined as consolidated earnings before interest and taxes minus a capital
charge equal to the weighted average cost of capital times average funds
employed. For fiscal year 1999, the awards were based 50% on growth in economic
profit and 50% on growth in earnings per share. Mr. Harrell's cash incentive
award for the 1999 fiscal year was approximately 10% more than the award he
received in 1998. Mr. Harrell's 1999 award was determined by the Committee after
consideration of the 39% increase in economic profit during fiscal year 1999,
the Company's continued strong earnings and earnings per share in a difficult
operating environment, the Committee's assessment of Mr. Harrell's individual
contributions to corporate performance and a review of total cash compensation
paid to chief executive officers of comparable companies.
Equity Participation. The Committee administers the Company's 1989 and
1997 Executive Stock Plans, under which it has granted to key executive
employees options to purchase shares of the Company's Common Stock based upon a
determination of competitive aggregate compensation levels. The primary
objective of issuing stock options is to encourage significant investment in
stock ownership by management and to provide long-term financial rewards linked
directly to market performance of the Company's stock. The Committee believes
that significant ownership of stock by senior management is the best way to
align the interests of management and the shareholders, and the Company's stock
incentive program is effectively designed to further this objective.
Stock options granted to key executives in the 1998 fiscal year were
intended to meet the Committee's two-year option grant targets and, therefore,
no new grants (excluding reload options described below) were made during the
1999 fiscal year to the Named Executive Officers. The 1998 grants included
grants made under a program instituted during the 1992 fiscal year to promote an
increase in the equity interest of key executives through systematic
-8-
<PAGE>
option exercises and the retention of shares. The program requires each
participant to make an investment in the Company by contributing to the program
currently owned shares equal to at least 10% of the number of shares subject to
the initial options granted the participant under the program. Option exercises
occur automatically at not less than six-month intervals when at least a minimum
stock price appreciation has occurred.
Except under extraordinary circumstances or as otherwise determined by
the Committee, participants have agreed that the options granted under the
program may be exercised only through stock-for-stock swaps, and both the
contributed shares and additional shares acquired through option exercises under
the program may not be sold by the participating executives during the ten-year
option term. Each option granted under the program included a reload
replenishment feature which entitles participants each time a stock-for-stock
exercise occurs to receive automatically a new option grant at the fair market
value of the Company's Common Stock on the date of grant. The number of reload
options granted is equal to the number of shares contributed by a participant to
effect a stock-for-stock swap. In exchange for this replenishment feature, each
participant has agreed to retain in the program shares equaling at least the
after-tax gain realized upon each exercise.
Tax Considerations. The Internal Revenue Code was amended in 1993 to
disallow deductions on annual compensation in excess of $1,000,000 for certain
executives of public companies, beginning in 1994. The Company has taken
appropriate actions to preserve the deductibility of stock options, and to date
all compensation payable to the Company's executive officers has been deductible
or voluntarily deferred under the Company's Deferred Income Plan. At the same
time, the Committee has monitored the impact of this law over the past several
years and has taken into consideration both the benefits of favorable tax
treatment for the Company and the necessity for the Committee to have the
discretion to take appropriate steps to further its executive compensation
philosophy. Accordingly, the Committee has approved the new Executive Officer
Annual Incentive Plan, and the Board of Directors has recommended that it be
approved by the shareholders at the Annual Meeting scheduled to be held on
October 26, 1999. See Proposal Two for further discussion of the new Executive
Officer Annual Incentive Plan and Exhibit A attached hereto for the full text of
such plan.
Executive Compensation Committee
William W. Berry, Chairman
Ronald E. Carrier
Richard G. Holder
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<PAGE>
PERFORMANCE GRAPH
The graph below compares the cumulative total return on Common Stock of
the Company for the last five fiscal years with the total return of the Standard
& Poors Midcap 400 Stock Index and the Media General Tobacco Industry Group
Index. For the 1999 fiscal year, the Company has added a Peer Group Index to
compare the Company's stock performance relative to companies operating in
comparable businesses under comparable conditions. The companies in the Peer
Group (and their stock symbols) are DIMON Incorporated (DMN) and Standard
Commercial Corporation (STW). The graph assumes that $100 was invested on June
30, 1994 in the Common Stock of the Company and in each of the comparative
indices, in each case with dividends reinvested.
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
[CUMULATIVE TOTAL RETURN ON COMMON STOCK]
- --------------------------------------------------------------------------------------------------------------------
- -------------------------------------- -----------------------------------------------------------------------------
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
- -------------------------------------- ------------- ------------ ------------ ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Universal Corporation $100.00 $112.94 $148.78 $184.97 $223.90 $176.66
- -------------------------------------- ------------- ------------ ------------ ----------- ----------- -------------
Peer Group Index $100.00 $ 94.26 $102.09 $150.79 $ 70.14 $ 35.00
- -------------------------------------- ------------- ------------ ------------ ----------- ----------- -------------
S&P Midcap 400 Index $100.00 $122.34 $146.15 $180.24 $229.17 $258.01
- -------------------------------------- ------------- ------------ ------------ ----------- ----------- -------------
Media General Tobacco Index $100.00 $139.60 $195.75 $256.60 $248.64 $265.00
- -------------------------------------- ------------- ------------ ------------ ----------- ----------- -------------
</TABLE>
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<PAGE>
EXECUTIVE COMPENSATION
The individuals named below include the Company's Chairman and Chief
Executive Officer and the other four executive officers of the Company who were
the most highly compensated executive officers of the Company for the 1999
fiscal year. Information is provided for the fiscal years ended on June 30 of
the years shown.
Summary Compensation Table
<TABLE>
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
---------------------------------------- -----------------------
Fiscal
Name Year Other Restricted Securities
and Principal Ended Annual Stock Underlying All Other
Position 6/30 Salary($) Bonus($) 1 Compensation($) 2 Awards($) Options(#) Compensation($) 6
-------- ---- --------- ---------- ----------------- ---------- ----------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Henry H. Harrell 1999 $522,047 $894,175 -- $ 0 35,024 4 $135,522
Chairman and Chief 1998 493,825 813,636 -- 319,800 3 182,854 5 100,609
Executive Officer 1997 479,779 510,000 -- 0 27,167 4 84,971
Allen B. King 1999 382,761 667,086 -- 0 43,436 4 73,304
President and Chief 1998 368,399 590,793 -- 239,850 3 136,380 5 57,204
Operating Officer 1997 344,435 369,400 -- 0 19,261 4 49,937
Jack M.M. van de Winkel 1999 267,500 261,815 -- 0 0 0
Vice Chairman and 1998 252,500 377,000 -- 0 17,000 0
Executive Vice
President,
Deli Universal, Inc.
William L. Taylor 1999 296,300 319,575 -- 0 28,857 4 55,716
Vice President and 1998 285,200 293,011 -- 147,600 3 83,430 5 45,095
Chief Administrative 1997 276,665 183,500 -- 0 11,792 4 26,112
Officer
Hartwell H. Roper 1999 221,300 235,767 -- 0 24,664 4 31,177
Vice President and 1998 210,200 216,015 -- 133,250 3 74,889 5 25,677
Chief Financial 1997 202,720 130,900 -- 0 10,214 4 23,749
Officer
- -----------------
</TABLE>
1 Represents cash incentive bonuses awarded by the Executive
Compensation Committee under Management Performance Plans of the Company and its
principal subsidiaries.
2 None of the Named Executive Officers received perquisites or other
personal benefits in excess of the lesser of $50,000 or 10% of his total annual
salary and bonus for each reported year.
3 The amounts in this column are the dollar values, based on a $41.00
closing price of a share of Common Stock on December 15, 1997, as reported on
the New York Stock Exchange, of the following number of shares of restricted
Common Stock awarded as of such date to the Named Executive Officers: Mr.
Harrell, 7,800 shares; Mr. King, 5,850 shares; Mr. Taylor, 3,600 shares; and Mr.
Roper, 3,250 shares. The restricted shares matched, on a one-for-one basis,
shares of Common Stock contributed by such executives to the automatic exercise
program described above in "Report of Executive Compensation Committee." On June
15, 1998, the
-11-
<PAGE>
restricted shares were used for stock swap option exercises under the automatic
exercise program.
4 The options granted to the Named Executive Officers in the 1999 and
1997 fiscal years were reload options granted under the automatic exercise
program described above in "Report of Executive Compensation Committee."
5 The following number of options granted to the Named Executive
Officers in the 1998 fiscal year were reload options granted under the automatic
exercise program described above in "Report of Executive Compensation
Committee": Mr. Harrell, 62,854; Mr. King, 46,380; Mr. Taylor, 28,430; and Mr.
Roper, 24,889.
6 The amounts in the "All Other Compensation" column represent (i)
employer contributions to the Employees' Stock Purchase Plan and the
Supplemental Stock Purchase Plan of Universal Leaf (the "Stock Purchase Plans"),
(ii) life insurance premium payments made by the Company under the Executive
Insurance Program, and (iii) interest accrued to participants' accounts under
the Company's Deferred Income Plan (the "DIP") to the extent such interest
exceeded 120% of the applicable federal long-term rate under Internal Revenue
Code Section 1274(d). Employer contributions to the Stock Purchase Plans on
behalf of the Named Executive Officers for the 1999, 1998 and 1997 fiscal years
were in the following respective amounts: Mr. Harrell, $24,348, $22,098 and
$21,359; Mr. King, $18,700, $18,000 and $17,100; Mr. Taylor, $14,800, $14,256
and $0; and Mr. Roper, $9,010, $9,300 and $9,099. The life insurance premiums
paid by the Company on behalf of such executive officers for the 1999, 1998 and
1997 fiscal years were in the following respective amounts: Mr. Harrell,
$101,353, $70,327 and $55,633; Mr. King, $52,819, $37,704 and $30,082; Mr.
Taylor, $40,916, $30,839 and $26,112; and Mr. Roper, $20,730, $15,170 and
$13,357. The accruals of interest on income deferred by such executive officers
under the DIP in excess of 120% of the applicable federal long-term rate under
Internal Revenue Code Section 1274(d) for the 1999, 1998 and 1997 fiscal years
were in the following respective amounts: Mr. Harrell, $9,821, $8,184 and
$7,979; Mr. King, $1,785, $1,500 and $2,755; and Mr. Roper, $1,437, $1,207 and
$1,293.
Retirement Benefits
Employees of the Company and certain U.S. subsidiaries are covered by a
defined benefit retirement plan, which is qualified under the Internal Revenue
Code, and a defined benefit supplemental retirement plan, which is a
non-qualified plan to provide benefits in excess of limits allowed by the
Internal Revenue Code. The table below shows estimated annualized benefits
payable under both plans at normal retirement (age 65) based on the average
salary and bonus (as reported in the Summary Compensation Table) for the highest
consecutive three years. The actuarial equivalent of benefits under the
supplemental retirement plan is payable in a lump sum upon retirement.
-12-
<PAGE>
<TABLE>
<CAPTION>
Years of Service
--------------------------------------------------------------------------------------------------
Remuneration 15 20 25 30 35 40 45
- ------------------- ------------- -------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
$300,000 $65,421 $87,228 $109,036 $130,843 $152,650 $166,086 $179,522
400,000 88,263 117,684 147,106 176,526 205,947 223,862 241,777
500,000 111,105 148,140 185,175 222,209 259,244 281,638 304,032
600,000 133,946 178,595 223,244 267,893 312,542 339,414 366,287
700,000 156,788 209,051 261,314 313,576 365,839 397,190 428,542
800,000 179,630 239,506 299,383 359,260 419,136 454,966 490,797
900,000 202,472 269,962 337,453 404,943 472,434 512,742 553,051
1,000,000 225,313 300,418 375,522 450,626 525,731 570,519 615,306
1,100,000 248,155 330,873 413,592 496,310 579,028 628,295 677,561
1,200,000 270,997 361,329 451,661 541,993 632,325 686,071 739,816
1,300,000 293,838 391,784 489,731 587,677 685,623 743,847 802,071
1,400,000 316,680 422,240 527,800 633,360 738,920 801,623 864,326
1,500,000 339,522 452,696 565,870 679,043 792,217 859,399 926,580
</TABLE>
The credited years of service for Messrs. Harrell, King, Taylor and
Roper are thirty-three, thirty, nine and twenty-five, respectively.
The benefits shown in the table are calculated on the basis of a 50%
joint and survivor benefit, assuming that at retirement the age of the
employee's spouse is 62. The social security benefit will be paid in addition to
the amounts shown in the table.
Mr. van de Winkel is covered by a pension plan established under the
laws of the Netherlands. The plan, which covers employees of N.V. Deli Universal
and certain other Dutch subsidiaries, is partially funded by employer and
participant contributions. During the fiscal year ended June 30, 1999, N.V. Deli
Universal contributed $39,750 to the plan on behalf of Mr. van de Winkel. His
estimated annual pension benefit under the plan assuming retirement at age 60,
continuance of current salary level, and twenty years of service would be
$112,450.
Stock Options
The following tables contain information concerning grants of stock
options to the Named Executive Officers during the fiscal year ended June 30,
1999, exercises of stock options by such executive officers in such fiscal year
and the fiscal year-end value of all unexercised stock options held by such
executive officers.
-13-
<PAGE>
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
Individual Grants 1
---------------------------------------------------------
Number of % of Total
Securities Options Exercise
Underlying Granted Or Base
Options to Employees Price Expiration Grant Date
Name Granted (#) in Fiscal Year ($/Sh) Date Present Value ($) 2
---- ----------- -------------- ------ ---- -------------------
<S> <C> <C> <C> <C> <C>
Henry H. Harrell 10,936 5.1% $33.25 12/01/04 $80,926
24,088 11.1 33.25 12/01/01 129,593
Allen B. King 35,866 16.6 33.25 12/01/01 192,959
7,572 21.8 28.563 12/01/01 30,667
William L. Taylor 22,326 10.3 33.25 12/01/01 125,919
6,531 18.8 28.563 12/01/01 26,451
Hartwell H. Roper 19,611 9.1 33.25 12/01/01 105,507
5,053 14.5 28.563 12/01/01 20,465
- ------------------
</TABLE>
1 All options granted in the last fiscal year were reload options which
replaced shares of the Company's Common Stock used for stock swap option
exercises under the automatic exercise program described above in "Report of
Executive Compensation Committee." In general, such reload options become
exercisable six months after the date of grant with exercise occurring
automatically if certain minimum price thresholds are met. The exercise price of
the listed options was the fair market value on the date of grant.
2 The Black-Scholes option pricing model was used to determine the
"Grant Date Present Value" of the options listed in the table. For options with
a $33.25 exercise price and a 12/01/04 expiration date, the model assumed a risk
free interest rate of 5.72%, a dividend yield of 4.22% and a stock price
volatility of .299 based on the average weekly stock market closing price over
the past 10 years. For options with a $33.25 exercise price and a 12/01/01
expiration date, the model assumed a risk free interest rate of 5.54%, a
dividend yield of 4.22% and a stock price volatility of .299 based on the
average weekly stock market closing price over the past 10 years. For options
with a $28.563 exercise price and a 12/01/01 expiration date, the model assumed
a risk free interest rate of 5.40%, a dividend yield of 4.22% and a stock price
volatility of .299 based on the average weekly stock market closing price over
the past 10 years. Because the magnitude of any nontransferability discount is
extremely difficult to determine, none was applied in determining the value of
the reported options. The grant date present values set forth in the table are
only theoretical values and may not accurately determine present value. The
actual value, if any, an optionee will realize will depend on the excess of
market value of the Company's Common Stock over the exercise price on the date
the option is exercised.
-14-
<PAGE>
Aggregated Option Exercises in Last Fiscal Year
And Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options
Options at FY-End (#) at FY-End ($)3
--------------------------- ----------------------------
Shares Acquired Value
Name on Exercise (#)1 Realized ($)2 Exercisable Unexercisable Exercisable Unexercisable
---- ---------------- ------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Henry H. Harrell 41,226 $206,242 232,667 0 $ 0 $ 0
Allen B. King 51,172 256,476 194,007 7,572 26,413 0
William L. Taylor 33,753 162,157 117,548 6,531 0 0
Hartwell H. Roper 30,536 170,200 104,714 5,053 0 0
- -----------------
</TABLE>
1 The number of shares of the Company's Common Stock included in this
column represents the gross amount of shares issued in exchange for shares
already owned by the officers listed in the table used to pay the exercise price
of options exercised by them in the last fiscal year. The following is the net
amount of shares of Common Stock acquired by each of these officers as a result
of such exercises, after deducting already-owned shares swapped but including
shares sold to pay taxes: Mr. Harrell, 6,202 shares; Mr. King, 7,734 shares; Mr.
Taylor, 4,896 shares; and Mr. Roper, 4,272 shares.
2 The value realized represents the difference between the exercise
price of the option and the fair market value of the Company's Common Stock on
the date of exercise.
3 The value of the unexercised options at fiscal year-end represents
the difference between the exercise price of any outstanding options and $28.44,
the closing sales price of a share of the Company's Common Stock on June 30,
1999, as reported on the New York Stock Exchange.
Of the options shown as of the fiscal year end, options on 232,667
shares for Mr. Harrell, 199,079 shares for Mr. King, 124,079 shares for Mr.
Taylor and 109,767 shares for Mr. Roper, except under extraordinary
circumstances, are only exercisable automatically at not less than six month
intervals when at least a minimum stock price appreciation has occurred.
Contractual Obligations
To ensure that the Company will have the continued dedicated service of
certain executives notwithstanding the possibility, threat or occurrence of a
change of control, the Company has entered into change of control employment
agreements (the "Employment Agreements") with certain executives, including
Henry H. Harrell, Allen B. King, William L. Taylor and Hartwell H. Roper. The
Employment Agreements generally provide that if the executive is terminated
other than for cause within three years after a change of control of the
Company, or if the executive terminates his employment for good reason within
such three-year period or voluntarily during the 30-day period following the
first anniversary of the change of control, the executive is entitled to receive
"severance benefits." Severance benefits include a lump sum severance payment
equal to three times the sum of his base salary and highest annual
-15-
<PAGE>
bonus, together with certain other payments and benefits, including continuation
of employee welfare benefits and an additional payment to compensate the
executive for certain excise taxes imposed on certain change of control
payments.
The Board of Directors believes that the Employment Agreements benefit
the Company and its shareholders by securing the continued service of key
management personnel and by enabling management to perform its duties and
responsibilities without the distracting uncertainty associated with a change of
control.
CERTAIN RELATIONSHIPS
Baker, Donelson, Bearman & Caldwell, the law firm to which Lawrence S.
Eagleburger serves as Senior Foreign Policy Advisor, is retained from time to
time to provide legal services to the Company and its subsidiaries.
Proposal Two
APPROVAL OF THE UNIVERSAL CORPORATION
EXECUTIVE OFFICER ANNUAL INCENTIVE PLAN
On July 27, 1999, the Executive Compensation Committee (the
"Committee") of the Board of Directors adopted, subject to and effective upon
shareholder approval, the Universal Corporation Executive Officer Annual
Incentive Plan (the "Section 162(m) Plan"). In recent years, the Committee has
increasingly emphasized performance against preestablished performance standards
in awarding incentive compensation to key management employees. For fiscal year
1998, executive bonuses were based entirely on growth in economic profit,
whereas for fiscal year 1999, executive bonuses were based 50% on growth in
economic profit and 50% on growth in earnings per share.
The Section 162(m) Plan has been designed to qualify bonuses paid under
the Section 162(m) Plan as "qualified performance-based compensation" for
purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code"). This enables the Company to exclude compensation payable under the
Section 162(m) Plan from the deduction limitations of Section 162(m) which
generally precludes a deduction for compensation paid to the Company's Chief
Executive Officer and next four highest compensated executive officers to the
extent compensation for a taxable year to any such individual exceeds
$1,000,000. Under Section 162(m) of the Code, the material terms of a plan such
as the Section 162(m) Plan must be submitted to shareholders for approval every
five years.
The purposes of the Section 162(m) Plan are to promote the success of
the Company; to provide designated executive officers with an opportunity to
receive incentive compensation dependent upon that success; to attract, retain
and motivate such individuals; and to provide awards that are "qualified
performance-based compensation" under Section 162(m). There will be presented at
the 1999 Annual Meeting a proposal to approve the adoption of the Section 162(m)
Plan, which, subject to such approval, will have effect commencing with bonuses
payable in respect of the Company's fiscal year ending June 30, 2000, to
executive officers
-16-
<PAGE>
selected by the Committee to participate in the plan. Participants in the
Section 162(m) Plan will not receive awards under the Management Performance
Plans of the Company and its principal subsidiaries. The following description
of the Section 162(m) Plan is qualified in its entirety by reference to the full
text of such plan, which is set forth in the attached Exhibit A.
Material Terms of the Section 162(m) Plan
Duration and Modification. The Section 162(m) Plan will be effective
only upon its approval by the shareholders. If approved at the 1999 Annual
Meeting, the Section 162(m) Plan will be effective for the fiscal year ending
June 30, 2000 and each of the next four succeeding fiscal years unless sooner
terminated by the Committee. For the fifth succeeding fiscal year, the Section
162(m) Plan will remain in effect in accordance with its terms but will be
submitted for re-approval by the shareholders at the annual meeting of
shareholders held during such year. Payment of all awards under the Section
162(m) Plan for such fifth fiscal year and any future fiscal years will be
contingent upon such approval.
The Committee may at any time amend or terminate the Section 162(m)
Plan. However, no amendment may be made after the date an executive officer is
selected as a participant for a performance period that may adversely affect the
rights of such participant for that performance period, and no amendment may
increase the maximum award payable under the Section 162(m) Plan without
shareholder approval or otherwise be effective without shareholder approval if
such approval is necessary so that awards will be "qualified performance-based
compensation" under Section 162(m) of the Code.
Administration. The Section 162(m) Plan will be administered by the
Committee. The Committee will be composed of not less than two Directors, each
of whom is intended to be an "outside director" within the meaning of Section
162(m) of the Code.
Eligibility. The Committee will designate the executive officers of the
Company eligible to participate in the Section 162(m) Plan for each performance
period. The executive officers of the Company are the Company's Chief Executive
Officer and such other executives of the Company as may be considered from time
to time to be executive officers for purposes of the Securities Exchange Act of
1934.
Performance Measures and Goals. Payment of a cash incentive to
participants is conditioned upon the attainment of pre-established performance
goals measured over a performance period designated by the Committee. A
performance period may be one or more periods of time over which the attainment
of one or more performance goals will be measured for the purposes of
determining a participant's right to payment in respect of an award under the
Section 162(m) Plan. The Committee has designated the fiscal year ending June
30, 2000 as the initial performance period. The performance goals applicable to
a performance period must be established in writing by the Committee no later
than the earlier of (i) 90 days after the start of the performance period, or
(ii) the date upon which 25% of the performance period has elapsed. The
performance goals are determined by reference to one or more of the following
performance measures, as selected by the Committee and as applicable to Company
and/or business unit performance: net income; earnings per share; net revenues;
gross profit; income before income
-17-
<PAGE>
taxes; economic profit; return on assets; return on funds employed and return on
equity; in each case as determined in accordance with generally accepted
accounting principles, where applicable, as consistently applied by the Company,
and if so determined by the Committee, adjusted to the extent permitted under
Section 162(m) of the Code, to omit the effects of extraordinary items, the gain
or loss on the disposal of a business segment, unusual or infrequently occurring
events and transactions and cumulative effects of changes in accounting
principles. From among these, performance measure(s) may vary from performance
period to performance period and participant to participant.
Determination and Payment of Incentives. The cash incentive amount that
is payable to a participant in a performance period will be determined in
accordance with a pre-established objective award formula based on the
achievement of performance goals. The Committee has the discretion to reduce or
eliminate, but cannot increase, any amounts otherwise payable under the Section
162(m) Plan. All payments under the Section 162(m) Plan will be made in cash.
The maximum cash incentive payable under the Section 162(m) Plan to any
participant with respect to any fiscal year (or a portion thereof) contained
within a performance period is $2,000,000.
Death, Disability, Retirement or Change of Control. The Section 162(m)
Plan provides that if a participant dies or his or her employment is terminated
by reason of disability or retirement after an award has been granted but before
it has been determined to be earned, the Company will pay to the participant or,
in the case of death, to the participant's designated beneficiary or estate, a
prorated portion of the award that the Committee determines would have been
earned had the participant continued in employment. If a change of control of
the Company occurs, the Company will promptly pay to each participant for the
performance period in which the change of control occurs 100% of the target cash
incentive award for that performance period. Moreover, if, at the time of a
change of control of the Company, award payments for the preceding performance
period have not yet been determined or paid, the Company will also pay those
award payments based on performance in such prior period and no reduction for
subjective performance factors. Change of control under the Section 162(m) Plan
means change of control as defined in the Company's 1997 Executive Stock Plan.
Under both plans, a "change of control" shall be deemed to have taken place if
(i) any individual, entity or group becomes the beneficial owner of shares of
the Company having 20% or more of the total number of votes that may be cast for
the election of Directors of the Company, other than (a) as a result of any
acquisition directly from the Company, or (b) as a result of any acquisition by
any employee benefit plans (or related trusts) sponsored or maintained by the
Company or its subsidiaries; (ii) there is a change in the composition of the
Board of Directors of the Company such that the individuals who, as of July 1,
1997, constituted the Board of Directors (the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board; provided, however, that
any individual who becomes a member of the Board of Directors subsequent to July
1, 1997 whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of those individuals
who are members of the Board of Directors and who were also members of the
Incumbent Board (or deemed to be such pursuant to this proviso) shall be
considered as though such individual were a member of the Incumbent Board; but,
provided further, that any such individual whose initial assumption of office
occurs as a result of either an actual or threatened election contest or other
actual or threatened
-18-
<PAGE>
solicitation of proxies or consents by or on behalf of a person other than the
Board of Directors shall not be so considered as a member of the Incumbent
Board; or (iii) if at any time, (y) the Company shall consolidate with, or merge
with, any other person and the Company shall not be the continuing or surviving
corporation, (x) any person shall consolidate with, or merge with, the Company,
and the Company shall be the continuing or surviving corporation and in
connection therewith, all or part of the outstanding shares of Common Stock of
the Company shall be changed into or exchanged for stock or other securities of
any other person or cash or any other property, (y) the Company shall be a party
to a statutory share exchange with any other person after which the Company is a
subsidiary of any other person, or (z) the Company shall sell or otherwise
transfer 50% or more of the assets or earning power of the Company and its
subsidiaries (taken as a whole) to any person or persons.
New Plan Benefits. Because participants are selected for each
performance period and because amounts payable under the Section 162(m) Plan are
based on performance measures, performance goals and award formulas established
for each performance period, it cannot be determined at this time what amounts,
if any, will be received by or allocated to any person or group of persons under
the Section 162(m) Plan if the Section 162(m) Plan is approved, or what amounts
would have been received by or allocated to any person or group of persons for
the last fiscal year if the plan had been in effect.
Vote Required
In order for it to be adopted, the Section 162(m) Plan must be approved
by the holders of a majority of the shares of Common Stock present or
represented by properly executed and delivered proxies at the Annual Meeting.
Abstentions and Broker Shares voted as to any matter at the Annual Meeting will
be included in determining the number of shares present or represented at the
Annual Meeting. Broker Shares that are not voted on any matter at the Annual
meeting will not be included in determining the number of shares present or
represented at the Annual Meeting.
The Board of Directors recommends that the shareholders vote in favor
of Proposal Two.
INDEPENDENT PUBLIC ACCOUNTANTS
The independent auditors of the Company are appointed by the Board of
Directors upon the recommendation of the Audit Committee. Ernst & Young LLP, the
Company's independent auditors since 1971, has been appointed for the next
fiscal year. Representatives of Ernst & Young LLP will be present at the Annual
Meeting, will be available to respond to appropriate questions and may make a
statement if they so desire.
PROPOSALS FOR 2000 ANNUAL MEETING
Under the regulations of the Securities and Exchange Commission, any
shareholder desiring to make a proposal to be acted upon at the 2000 Annual
Meeting of Shareholders must
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<PAGE>
cause such proposal to be delivered, in proper form, to the Secretary of the
Company, whose address is 1501 North Hamilton Street, P.O. Box 25099, Richmond,
Virginia 23260, no later than May 29, 2000, in order for the proposal to be
considered for inclusion in the Company's Proxy Statement. The Company
anticipates holding the 2000 Annual Meeting on October 24, 2000.
The Company's Bylaws also prescribe the procedure a shareholder must
follow to nominate Directors or to bring other business before shareholders'
meetings. For a shareholder to nominate a candidate for Director or to bring
other business before a meeting, notice must be received by the Secretary of the
Company not less than 60 days and not more than 90 days prior to the date of the
meeting. Based upon an anticipated date of October 24, 2000 for the 2000 Annual
Meeting of Shareholders, the Company must receive such notice no later than
August 25, 2000 and no earlier than July 26, 2000. Notice of a nomination for
Director must describe various matters regarding the nominee and the shareholder
giving the notice. Notice of other business to be brought before the meeting
must include a description of the proposed business, the reasons therefor, and
other specified matters. Any shareholder may obtain a copy of the Company's
Bylaws, without charge, upon written request to the Secretary of the Company.
OTHER MATTERS
THE COMPANY'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 1999,
INCLUDING FINANCIAL STATEMENTS, IS BEING MAILED TO SHAREHOLDERS WITH THIS PROXY
STATEMENT. A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL
YEAR ENDED JUNE 30, 1999, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION,
EXCLUDING EXHIBITS, CAN BE OBTAINED WITHOUT CHARGE BY WRITING TO KAREN M. L.
WHELAN, VICE PRESIDENT AND TREASURER, UNIVERSAL CORPORATION, 1501 NORTH HAMILTON
STREET, P.O. BOX 25099, RICHMOND, VIRGINIA 23260 OR BY VISITING THE COMPANY'S
WEBSITE AT WWW.UNIVERSALCORP.COM.
-20-
<PAGE>
EXHIBIT A
UNIVERSAL CORPORATION
EXECUTIVE OFFICER ANNUAL INCENTIVE PLAN
1. Purpose.
The purposes of the Plan are to promote the success of the Company; to
provide designated Executive Officers with an opportunity to receive incentive
compensation dependent upon that success; to attract, retain and motivate such
individuals; and to provide Awards that are "qualified performance-based
compensation" under Section 162(m) of the Code.
2. Definitions.
"Award" means an incentive award made pursuant to the Plan.
"Award Formula" means one or more objective formulas or standards
established by the Committee for purposes of determining an Award based on the
level of performance with respect to one or more Performance Goals. Award
Formulas may vary from Performance Period to Performance Period and from
Participant to Participant and may be established on a stand-alone basis, in
tandem or in the alternative.
"Award Schedule" means the Award Schedule established pursuant to
Section 4.1.
"Beneficiary" means the person(s) designated by the Participant, in
writing on a form provided by the Committee, to receive payments under the Plan
in the event of his or her death while a Participant or, in the absence of such
designation, the Participant's estate.
"Board of Directors" means the Board of Directors of the Company.
"Change of Control" means Change of Control as defined in the Company's
1997 Executive Stock Plan.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the Executive Compensation Committee of the Board of
Directors. The Committee shall be composed of not less than two directors, each
of whom is intended to be an "outside director" (within the meaning of Code
Section 162(m)).
"Company" means Universal Corporation and its successors.
"Covered Employee" means a covered employee within the meaning of Code
Section 162(m)(3).
A-1
<PAGE>
"Determination Period" means, with respect to a Performance Period
applicable to any Award under the Plan, the period commencing with the first day
of such Performance Period and ending on the earlier to occur of (i) 90 days
after the commencement of the Performance Period and (ii) the date upon which
twenty-five percent (25%) of the Performance Period shall have elapsed.
"Disability" means disability as defined under the Company's long term
disability plan or, if no such plan is in force at the time, as determined by
the Committee.
"Economic Profit" means consolidated earnings before interest and taxes
after certain adjustments minus a capital charge equal to the weighted average
cost of capital times average funds employed.
"Executive Officer" means a Person who is an executive officer of the
Company for purposes of the Securities Exchange Act of 1934, as amended.
"Participant" means an Executive Officer selected from time to time by
the Committee to participate in the Plan.
"Performance Goal" means the level of performance established by the
Committee as the Performance Goal with respect to a Performance Measure.
Performance Goals may vary from Performance Period to Performance Period and
from Participant to Participant and may be established on a stand-alone basis,
in tandem or in the alternative.
"Performance Measure" means one or more of the following selected by
the Committee to measure Company and/or business unit performance for a
Performance Period: net income; basic or diluted earnings per share; net
revenues; gross profit; income before income taxes; economic profit; return on
assets; return on funds employed and return on equity; each as determined in
accordance with generally accepted accounting principles, where applicable, as
consistently applied by the Company and, if so determined by the Committee prior
to the expiration of the Determination Period, adjusted, to the extent permitted
under Section 162(m) of the Code, to omit the effects of extraordinary items,
the gain or loss on the disposal of a business segment, unusual or infrequently
occurring events and transactions and cumulative effects of changes in
accounting principles. Performance Measures may vary from Performance Period to
Performance Period and from Participant to Participant and may be established on
a stand-alone basis, in tandem or in the alternative.
"Performance Period" means one or more periods of time, as the
Committee may designate, over which the attainment of one or more Performance
Goals will be measured for the purpose of determining a Participant's right to
payment in respect of an Award.
"Plan" means the Universal Corporation Executive Officer Annual
Incentive Plan.
"Plan Year" means the Company's fiscal year.
A-2
<PAGE>
"Retirement" means retirement at the Company's normal retirement age or
early retirement with the prior written approval of the Company.
3. Participation.
3.1 Participants shall be selected by the Committee from among the
Executive Officers. The selection of an Executive Officer as a Participant for a
Performance Period shall not entitle such individual to be selected as a
Participant with respect to any other Performance Period.
4. Awards.
4.1 Award Schedules. With respect to each Performance Period with
respect to which an Award may be earned by a Participant under the Plan, prior
to the expiration of the Determination Period the Committee shall establish in
writing for such Performance Period an Award Schedule for each Participant. The
Award Schedule shall set forth the applicable Performance Period, Performance
Measure(s), Performance Goal(s), and Award Formula(s) and such other information
as the Committee may determine. Once established for a Plan Year, such items
shall not be amended or otherwise modified to the extent such amendment or
modification would cause the compensation payable pursuant to the Award to fail
to constitute qualified performance based compensation under Code Section
162(m). Award Schedules may vary from Performance Period to Performance Period
and from Participant to Participant.
4.2 Determination of Awards. A Participant shall be eligible to
receive payment in respect of an Award only to the extent that the Performance
Goal(s) for such Award are achieved and the Award Formula as applied against
such Performance Goal(s) determines that all of some portion of such
Participant's Award has been earned for the Performance Period. As soon as
practicable after the close of each Performance Period, the Committee shall meet
to review and certify in writing whether, and to what extent, the Performance
Goals for the Performance Period have been achieved and, if so, to calculate and
certify in writing that amount of the Award earned by each Participant for such
Performance Period based upon such Participant's Award Formula. The Committee
shall then determine the actual amount of the Award to be paid to each
Participant and, in so doing, may use negative discretion to decrease, but not
increase, the amount of the Award otherwise payable to the Participant based
upon such performance. Anything in this Plan to the contrary notwithstanding,
the maximum Award payable to any Participant with respect to each Plan Year (or
portion thereof) contained within a Performance Period shall be $2,000,000.
4.3 Payment of Awards. Awards shall be paid in a lump sum cash
payment as soon as practicable after the amount thereof has been determined and
certified in accordance with Section 4.2. The Committee may, subject to such
terms and conditions and within such limits as it may from time to time
establish, permit one or more Participants to defer the receipt of amounts due
under the Plan in a manner consistent with the requirements of Code Section
162(m) so that any increase in the amount of an Award that is deferred shall be
based either on a reasonable rate of interest or the performance of a
predetermined investment in accordance with Treasury Regulation
1.162-27(e)(2)(iii)(B). If any Award which is earned pursuant to this
A-3
<PAGE>
Section 4 is paid prior to the time determined when the Award was initially
granted, the amount of such Award shall be reduced by an appropriate discount
factor determined by the Committee.
4.4 Change of Control. All Performance Goals and other conditions to
payment of Awards shall be deemed to be achieved or fulfilled as of the time of
a Change of Control. In the event of a Change of Control, the Company shall
promptly pay each Participant 100% of the Participant's Award for the
Performance Period in which the Change of Control occurs. In addition, if at the
time of a Change of Control there has been no determination or payment of an
Award for the preceding Performance Period, the Company shall pay to each
individual who was a Participant with respect to such prior Performance Period
the full amount to which he or she would have been paid assuming certification
by the Committee of the performance for such Performance Period and no reduction
in Award payments for factors other than performance factors. Payments under
this Section 4.4 shall be made not later than ten (10) days following the Change
of Control.
5. Termination of Employment.
5.1 Termination of Employment. Prior to the last day of the
Performance Period. Except as otherwise determined by the Committee or as
otherwise provided in Section 4.4 or Section 5.2, no Award with respect to a
Performance Period will be payable to any Participant who is not an employee of
the Company on the last day of such Performance Period.
5.2 Death, Disability or Retirement. In the event that a Participant
dies or his or her employment is terminated by reason of Disability or
Retirement after an Award has been granted to the Participant but before it has
been determined to be earned pursuant to Section 4.2, there shall be paid to the
Participant (or, in the event of death, to the Participant's Beneficiary or
estate) a prorated amount equal to the Award payment that the Committee
determines would have been paid to the Participant pursuant to Section 4.3 had
his or her employment continued, multiplied by a fraction, the numerator of
which is the number of completed calendar months of employment during the
Performance Period and the denominator of which is twelve.
6. Administration.
6.1 In General. The Committee shall have full and complete
authority, in its sole and absolute discretion, (i) to exercise all of the
powers granted to it under the Plan, (ii) to construe, interpret and implement
the Plan and any related document, (iii) to prescribe, amend and rescind rules
relating to the Plan, (iv) to make all determinations necessary or advisable in
administering the Plan, and (v) to correct any defect, supply any omission and
reconcile any inconsistency in the Plan.
6.2 Determinations. The actions and determinations of the Committee
or others to whom authority is delegated under the Plan on all matters relating
to the Plan and any Awards shall be final and conclusive. Such determinations
need not be uniform and may be made selectively among persons who receive, or
are eligible to receive, Awards under the Plan, whether or not such persons are
similarly situated.
A-4
<PAGE>
6.3 Appointment of Experts. The Committee may appoint such
accountants, counsel, and other experts as it deems necessary or desirable in
connection with the administration of the Plan.
6.4 Delegation. The Committee may delegate to others the authority
to execute and deliver such instruments and documents, to do all such acts and
things, and to take all such other steps deemed necessary, advisable or
convenient for the effective administration of the Plan in accordance with its
terms and purposes, except that the Committee shall not delegate any authority
with respect to decisions regarding Plan eligibility or the amount, timing or
other material terms of Awards.
6.5 Books and Records. The Committee and others to whom the
Committee has delegated such duties shall keep a record of all their proceedings
and actions and shall maintain all such books of account, records and other data
as shall be necessary for the proper administration of the Plan.
6.6 Payment of Expenses. The Company shall pay all reasonable
expenses of administering the Plan, including, but not limited to, the payment
of professional and expert fees.
7. Miscellaneous.
7.1 Nonassignability. No Award shall be assignable or transferable
(including pursuant to a pledge or security interest) other than by will or by
the laws of descent and distribution.
7.2 Withholding Taxes. Whenever payments under the Plan are to be
made or deferred, the Company will withhold therefrom, or from any other amounts
payable to or in respect of the Participant, an amount sufficient to satisfy any
applicable governmental withholding tax requirements related thereto.
7.3 Amendment or Termination of the Plan. The Plan may be amended or
terminated by the Committee in any respect except that (i) no amendment may be
made after the date on which an Executive Officer is selected as a Participant
for a Performance Period that would adversely affect the rights of such
Participant with respect to such Performance Period without the consent of the
affected Participant and (ii) no amendment shall be effective without the
approval of the shareholders of the Company to increase the maximum Award
payable under the Plan or if, in the opinion of counsel to the Company, such
approval is necessary to satisfy the applicable requirements of Code Section
162(m).
7.4 Other Payments or Awards. Nothing contained in the Plan will be
deemed in any way to limit or restrict the Company from making any award or
payment to any person under any other plan, arrangement or understanding,
whether now existing or hereafter in effect.
A-5
<PAGE>
7.5 Payments to Other Persons. If payments are legally required to
be made to any person other than the person to whom any amount is payable under
the Plan, such payments will be made accordingly. Any such payment will be a
complete discharge of the liability of the Company under the Plan.
7.6 Unfunded Plan. Nothing in this Plan will require the Company to
purchase assets or place assets in a trust or other entity to which
contributions are made or otherwise to segregate any assets for the purpose of
satisfying any obligations under the Plan. Participants will have no rights
under the Plan other than as unsecured general creditors of the Company.
7.7 Limits of Liability. Neither the Company nor any other person
participating in any determination of any question under the Plan, or in the
interpretation, administration or application of the Plan, will have any
liability to any party for any action taken or not taken in good faith under the
Plan.
7.8 No Right of Employment. Nothing in this Plan will be construed
as creating any contract of employment or conferring upon any Participant any
right to continue in the employ or other service of the Company or limit in any
way the right of the Company to change such person's compensation or other
benefits or to terminate the employment or other service of such person with or
without cause.
7.9 Section Headings. The section headings contained herein are for
convenience only, and in the event of any conflict, the text of the Plan, rather
than the section headings, will control.
7.10 Invalidity. If any term or provision contained herein is to any
extent invalid or unenforceable, such term, or provision will be reformed so
that it is valid, and such invalidity or unenforceability will not affect any
other provision or part hereof.
7.11 Applicable Law. The Plan will be governed by the laws of the
Commonwealth of Virginia, as determined without regard to the conflict of law
principles thereof.
7.12 Effective Date/Term. The Plan shall be effective only upon the
approval by the shareholders of the Company in a manner consistent with the
shareholder approval requirements of Code Section 162(m), and shall be effective
for the Plan Year in which such approval occurs and each of the next four
succeeding Plan Years unless sooner terminated by the Committee in accordance
with Section 7.3. For the fifth succeeding Plan Year, the Plan shall remain in
effect in accordance with its terms unless amended or terminated by the
Committee, and the Committee shall make the determinations required by Section 4
for such Plan Year, but the Plan shall be submitted for re-approval by the
shareholders of the Company at the annual meeting of shareholders held during
such fifth Plan Year, and payment of all Awards under the Plan for such Plan
Year and any future Plan Years shall he contingent upon such approval.
A-6
<PAGE>
UNIVERSAL CORPORATION
ANNUAL MEETING OF SHAREHOLDERS
TUESDAY, OCTOBER 26, 1999
2:00 P.M.
1501 NORTH HAMILTON STREET
RICHMOND, VA 23230
- --------------------------------------------------------------------------------
UNIVERSAL CORPORATION Proxy
- --------------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Henry H. Harrell, Allen B. King and William L.
Taylor, and each or any of them, proxies for the undersigned, with power of
substitution, to vote all the shares of Common Stock of Universal Corporation
held of record by the undersigned on September 7, 1999, at the Annual Meeting of
Shareholders to be held at 2:00 p.m. on October 26, 1999, and at any
adjournments thereof, upon the matters listed on the reverse side, as more fully
set forth in the Proxy Statement, and for the transaction of such other business
as may properly come before the Meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED ON THE
REVERSE SIDE BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR ALL NOMINEES AND FOR PROPOSAL 2.
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
(CONTINUED, AND TO BE DATED AND SIGNED ON REVERSE SIDE)
<PAGE>
Please detach here
UNIVERSAL CORPORATION
COMMON STOCK
<TABLE>
<CAPTION>
<S> <C>
1. Election of Directors: 01 William W. Berry 04 Richard G. Holder [ ] Vote FOR [ ] Vote WITHHELD
02 Ronald E. Carrier 05 Hubert R. Stallard all nominees from all nominees
03 Lawrence S. Eagleburger
____________________________________________
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDICATED NOMINEE, | |
WRITE THE NUMBER(S) OF THE NOMINEE(S) IN THE BOX PROVIDED TO THE RIGHT.) |____________________________________________|
2. Proposal to approve the Universal Corporation Executive Officer Annual
Incentive Plan. [ ]For [ ] Against [ ] Abstain
Address Change? Mark Box [ ]
Indicate changes below:
Date ________________________________
____________________________________________
| |
| |
|____________________________________________|
Signature(s) in Box
Please sign exactly as your name(s) appear(s)
on this Proxy. Attorneys-in-fact, executors,
trustees, guardians, corporate officers, etc.
should give full title.
</TABLE>
<PAGE>
UNIVERSAL CORPORATION
ANNUAL MEETING OF SHAREHOLDERS
TUESDAY, OCTOBER 26, 1999
2:00 P.M.
1501 NORTH HAMILTON STREET
RICHMOND, VA 23230
- --------------------------------------------------------------------------------
UNIVERSAL CORPORATION Voting Instruction
- --------------------------------------------------------------------------------
TO TRUSTEE, LANDAMERICA FINANCIAL GROUP, INC. SAVINGS AND STOCK OWNERSHIP PLAN.
THIS VOTING INSTRUCTION IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
UNIVERSAL CORPORATION.
Pursuant to Section 10.5 of the LandAmerica Financial Group, Inc. Savings and
Stock Ownership Plan, you are directed to vote, in person or by proxy, the whole
shares of Common Stock of Universal Corporation credited to the undersigned
Participant's Account as of June 30, 1999, at the Annual Meeting of Shareholders
of Universal Corporation, to be held at 2:00 p.m. on October 26, 1999, and at
any adjournments thereof, upon the matters listed on the reverse side, as more
fully set forth in the Proxy Statement, and for the transaction of such other
business as may properly come before the Meeting.
THIS VOTING INSTRUCTION WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED ON THE REVERSE SIDE BY THE UNDERSIGNED PARTICIPANT. IF NO DIRECTION IS
MADE, OR IF A VOTING INSTRUCTION IS NOT PROPERLY EXECUTED AND RECEIVED BY THE
TRUSTEE, THE SHARES OF UNIVERSAL CORPORATION COMMON STOCK CREDITED TO YOUR
PARTICIPANT'S ACCOUNT SHALL BE VOTED IN THE SAME PROPORTION AS THOSE SHARES OF
UNIVERSAL CORPORATION COMMON STOCK FOR WHICH THE TRUSTEE HAS RECEIVED PROPER
VOTING INSTRUCTIONS WITH RESPECT TO PROPOSALS 1 AND 2.
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
(CONTINUED, AND TO BE DATED AND SIGNED ON REVERSE SIDE)
<PAGE>
Please detach here
LANDAMERICA FINANCIAL GROUP, INC. SAVINGS AND STOCK OWNERSHIP PLAN
<TABLE>
<CAPTION>
<S> <C>
1. Election of Directors: 01 William W. Berry 04 Richard G. Holder [ ] Vote FOR [ ] Vote WITHHELD
02 Ronald E. Carrier 05 Hubert R. Stallard all nominees from all nominees
03 Lawrence S. Eagleburger
____________________________________________
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDICATED NOMINEE, | |
WRITE THE NUMBER(S) OF THE NOMINEE(S) IN THE BOX PROVIDED TO THE RIGHT.) |____________________________________________|
2. Proposal to approve the Universal Corporation Executive Officer Annual
Incentive Plan. [ ]For [ ] Against [ ] Abstain
Address Change? Mark Box [ ]
Indicate changes below:
Date ________________________________
____________________________________________
| |
| |
|____________________________________________|
Signature(s) in Box
Please sign exactly as your name(s) appear(s)
on this Proxy. Attorneys-in-fact, executors,
trustees, guardians, corporate officers, etc.
should give full title.
</TABLE>
<PAGE>
UNIVERSAL CORPORATION
ANNUAL MEETING OF SHAREHOLDERS
TUESDAY, OCTOBER 26, 1999
2:00 P.M.
1501 NORTH HAMILTON STREET
RICHMOND, VA 23230
- --------------------------------------------------------------------------------
UNIVERSAL CORPORATION Voting Instruction
- --------------------------------------------------------------------------------
TO TRUSTEE, EMPLOYEES' STOCK PURCHASE PLAN OF UNIVERSAL LEAF TOBACCO COMPANY,
INCORPORATED AND DESIGNATED AFFILIATED COMPANIES.
THIS VOTING INSTRUCTION IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
UNIVERSAL CORPORATION.
Pursuant to Section 13.01 of the Employees' Stock Purchase Plan of Universal
Leaf Tobacco Company, Incorporated and Designated Affiliated Companies, you are
directed to vote, in person or by proxy, the whole shares of Common Stock of
Universal Corporation credited to the undersigned Participant's Account as of
July 31, 1999, at the Annual Meeting of Shareholders of Universal Corporation,
to be held at 2:00 p.m. on October 26, 1999, and at any adjournments thereof,
upon the matters listed on the reverse side, as more fully set forth in the
Proxy Statement, and for the transaction of such other business as may properly
come before the Meeting.
THIS VOTING INSTRUCTION, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED ON THE REVERSE SIDE BY THE UNDERSIGNED PARTICIPANT. IF NO DIRECTION IS
MADE, OR IF A VOTING INSTRUCTION IS NOT PROPERLY EXECUTED AND RECEIVED BY THE
TRUSTEE, THE SHARES OF UNIVERSAL CORPORATION COMMON STOCK CREDITED TO YOUR
PARTICIPANT'S ACCOUNT SHALL BE VOTED IN THE SAME PROPORTION AS THOSE SHARES OF
UNIVERSAL CORPORATION COMMON STOCK FOR WHICH THE TRUSTEE HAS RECEIVED PROPER
VOTING INSTRUCTIONS WITH RESPECT TO PROPOSALS 1 AND 2.
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
(CONTINUED, AND TO BE DATED AND SIGNED ON REVERSE SIDE)
<PAGE>
Please detach here
EMPLOYEES' STOCK PURCHASE PLAN OF UNIVERSAL LEAF TOBACCO COMPANY,
INCORPORATED AND DESIGNATED AFFILIATED COMPANIES
<TABLE>
<CAPTION>
<S> <C>
1. Election of Directors: 01 William W. Berry 04 Richard G. Holder [ ] Vote FOR [ ] Vote WITHHELD
02 Ronald E. Carrier 05 Hubert R. Stallard all nominees from all nominees
03 Lawrence S. Eagleburger
____________________________________________
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDICATED NOMINEE, | |
WRITE THE NUMBER(S) OF THE NOMINEE(S) IN THE BOX PROVIDED TO THE RIGHT.) |____________________________________________|
2. Proposal to approve the Universal Corporation Executive Officer Annual
Incentive Plan. [ ]For [ ] Against [ ] Abstain
Address Change? Mark Box [ ]
Indicate changes below:
Date ________________________________
____________________________________________
| |
| |
|____________________________________________|
Signature(s) in Box
Please sign exactly as your name(s) appear(s)
on this Proxy. Attorneys-in-fact, executors,
trustees, guardians, corporate officers, etc.
should give full title.
</TABLE>
