<PAGE> 1
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>
<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>
ROCKWELL INTERNATIONAL 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):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
/X/ No fee required
<PAGE> 2
[LETTERHEAD]
ROCKWELL
- ---------------------------------------------------------------------------
January 3, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Rockwell International Corporation
Commission File No. 1-12383
Proxy Solicitation Material for Annual Meeting Shareowners
----------------------------------------------------------
Dear Sirs:
On behalf of Rockwell International Corporation (the Corporation), there are
transmitted herewith for filing via the EDGAR filing system the definitive
forms of:
o Letter to Shareowners, Notice of 1997 Annual Meeting and Proxy
Statement (the 1997 Proxy Statement) and Proxy in connection with
the Corporation's 1997 Annual Meeting of Shareowners in the form in
which such material is being furnished to shareowners; and
o Letters to Participants from the respective Trustees of the
Corporation's savings plans that hold the Corporation's voting
securities for the benefit of participating employees of the
Corporation and certain subsidiaries, and the respective Direction
Cards described therein, in the form in which such material,
together with the 1997 Proxy Statement, are being furnished to
participants in those Plans.
This material is first being sent or given to shareowners and plan
participants on January 3, 1997.
<PAGE> 3
Securities and Exchange Commission
Page 2
January 3, 1997
By copy of this letter, three copies of the proxy material described above are
being mailed to each national securities exchange on which any class of
securities of the Corporation is registered, and the required number of copies
of the proxy material are also being furnished to or filed with the London
Stock Exchange on which the Corporation's securities will be listed.
Very truly yours,
EDWARD T. MOEN, II
- ------------------
Edward T. Moen, II
Assistant Secretary
ETM/klm
Enclosures
cc: Mr. Gregory W. Hair, Branch Chief
Division of Corporation Finance
Securities and Exchange Commission
New York Stock Exchange, Inc.
Pacific Stock Exchange, Inc.
The Stock Exchange, London
<PAGE> 4
LOGO
Letter to
Shareowners
Notice of 1997
Annual Meeting
and
Proxy Statement
<PAGE> 5
LOGO
------------------------------------------------------------------------
Dear Shareowner:
You are cordially invited to attend the annual meeting of shareowners of the
Corporation.
The meeting will be held in the Grand Ballroom at the Westin William Penn
Hotel, 530 William Penn Place (at Mellon Square), Pittsburgh, Pennsylvania, on
Wednesday, February 5, 1997, at 10 a.m. At the meeting there will be a current
report on the activities of the Corporation followed by discussion and action on
the matters described in the Proxy Statement. Shareowners will have an
opportunity to comment on or to inquire about the affairs of the Corporation
that may be of interest to shareowners generally.
If you plan to attend the meeting, please complete and return the form
enclosed with your proxy or direction card, and an admittance card will be
forwarded to you promptly.
It is sincerely hoped that as many shareowners as can conveniently attend will
do so. However, if you cannot attend you will later receive a report to be
mailed to all shareowners concerning action taken at the meeting.
Sincerely yours,
LOGO
Donald R. Beall
Chairman of the Board
and Chief Executive Officer
<PAGE> 6
ROCKWELL INTERNATIONAL CORPORATION
_____________________________________________________
2201 Seal Beach Boulevard, Seal Beach, California 90740-8250
Notice of 1997 Annual Meeting of Shareowners
TO THE SHAREOWNERS OF
ROCKWELL INTERNATIONAL CORPORATION:
NOTICE IS HEREBY GIVEN that the 1997 Annual Meeting of Shareowners of Rockwell
International Corporation will be held in the Grand Ballroom at the Westin
William Penn Hotel, 530 William Penn Place (at Mellon Square), Pittsburgh,
Pennsylvania, on Wednesday, February 5, 1997, at 10 a.m. (Eastern Standard Time)
for the following purposes:
<TABLE>
<C> <S>
(a) to elect four members of the Board of
Directors of the Corporation with terms
expiring at the Annual Meeting in 2000;
(b) to consider and vote upon a proposal to
approve the selection by the Board of
Directors of the firm of Deloitte &
Touche LLP as auditors of the
Corporation; and
(c) to transact such other business as may
properly come before the meeting.
</TABLE>
Only shareowners of record at the close of business on December 20, 1996, will
be entitled to notice of, and to vote at, the meeting.
By order of the Board of Directors.
LOGO
William J. Calise, Jr.
Secretary
January 3, 1997
NOTE: THE BOARD OF DIRECTORS SOLICITS THE EXECUTION AND PROMPT RETURN OF
THE ACCOMPANYING PROXY. A RETURN ENVELOPE IS ENCLOSED.
2
<PAGE> 7
Proxy Statement
The 1997 Annual Meeting of Shareowners of Rockwell International Corporation
will be held on February 5, 1997, for the purposes set forth in the accompanying
Notice of 1997 Annual Meeting of Shareowners. This statement and the
accompanying proxy, which are first being sent to shareowners on or about
January 3, 1997, are furnished in connection with the solicitation by the Board
of Directors of proxies to be used at such meeting and at any adjournment
thereof. If a proxy in the accompanying form is duly executed and returned, the
shares represented thereby will be voted as specified therein, and if no
specification is made, the shares will be voted in accordance with the
recommendations of the Board of Directors. The proxy may, nevertheless, be
revoked prior to its exercise by delivering written notice of revocation to the
Secretary of the Corporation, by executing a later dated proxy or by attending
the meeting and voting in person.
The Corporation, which was incorporated in 1996, is the successor to the
former Rockwell International Corporation, which was incorporated in 1928, as
the result of a tax-free reorganization completed December 6, 1996. In
connection with that reorganization, the directors and all but one of the
executive officers of the predecessor corporation became directors and executive
officers of the Corporation, serving in the same capacities. References in this
Proxy Statement to the Corporation, Board of Directors and executive officers of
the Corporation with respect to periods on or prior to December 6, 1996 shall
mean, unless otherwise stated, the predecessor corporation and its Board of
Directors and executive officers.
It is the Corporation's policy to keep confidential proxy cards, ballots and
voting tabulations that identify individual shareowners except as may be
necessary to meet any applicable legal requirements and, in the case of any
contested proxy solicitation, as may be necessary to permit proper parties to
verify the propriety of proxies presented by any person and the results of the
voting. The judges of election and any employees associated with processing
proxy cards or ballots and tabulating the vote are required to acknowledge their
responsibility to comply with this policy of confidentiality.
For shareowners participating in the Automatic Dividend Reinvestment Service,
the administering bank will vote the shares that it holds for the participant's
account only in accordance with the proxy returned by the participant to the
Corporation in respect of the shares of the Corporation which the participant
holds of record or in accordance with other written instructions.
VOTING SECURITIES
On December 20, 1996, the Corporation had outstanding 191,097,201 shares of
Common Stock and 27,360,040 shares of Class A Common Stock. Each holder of Class
A Common Stock is entitled to ten votes for each share held and each holder of
Common Stock is entitled to one vote for each share held. On December 20, 1996,
Wells Fargo Bank, N.A., Los Angeles, California, as trustee under the
Corporation's Savings Plan for its participating employees, held 37,756,634
shares of Common Stock and 8,875,526 shares of Class A Common Stock,
representing approximately 19.8% of the total outstanding Common Stock, 32.4% of
the total outstanding Class A Common Stock and 27.2% of the aggregate voting
power of all of the Corporation's outstanding voting securities. Shares held by
the trustee on account of participants will be voted by the trustee in
accordance with written instructions from the participants, and where no
instructions are received, as the trustee deems proper.
ELECTION OF DIRECTORS
The Corporation's Restated Certificate of Incorporation provides that the
Board of Directors shall consist of three classes of directors with overlapping
three-year terms. One class of directors is to be elected each year with terms
extending to the third succeeding Annual Meeting after election. The Restated
Certificate of Incorporation provides that the Board shall maintain the three
classes so as to be as nearly equal in number as the then total number of
directors permits.
There are five directors whose terms expire at the 1997 Annual Meeting,
including Mr. John J. Creedon,
3
<PAGE> 8
a member of the Audit and the Environmental and Social Responsibility Committees
of the Board, who is not standing for re-election in accordance with the Board's
policy on retirement of directors. The Board of Directors has decreased the
number of directors of the Corporation to twelve, effective immediately prior to
the Annual Meeting, four of whom will be directors in the class with terms
extending to the 2000 Annual Meeting and until their successors are elected and
qualify.
It is intended that proxies in the accompanying form will be voted at the
meeting, unless authority to do so is withheld, for the election as directors of
the four nominees specified in Nominees for Directors with Terms Expiring in
2000 below, all of whom now serve as directors with terms extending to the 1997
Annual Meeting and until their successors are elected and qualify. If for any
reason any of those nominees is not a candidate (which is not expected) when the
election occurs, it is expected that proxies in the accompanying form will be
voted for the election of the other nominees and may be voted for the election
of a substitute nominee or, in lieu thereof, the Board of Directors may reduce
the number of directors.
INFORMATION AS TO NOMINEES FOR
DIRECTORS AND CONTINUING DIRECTORS
There is shown below for each nominee for director and each continuing
director, as reported to the Corporation, the name, age and principal
occupation; the position, if any, with the Corporation; the period of service as
a director of the Corporation (or a predecessor corporation); other
directorships held; and the committees of the Board of Directors on which the
nominee or continuing director serves.
4
<PAGE> 9
NOMINEES FOR DIRECTORS WITH TERMS EXPIRING IN 2000
RICHARD M. BRESSLER
Retired Chairman of the
Board,
El Paso Natural Gas Company,
Natural Gas Operations
Director Since 1986
Age 66
Mr. Bressler is Chairman of the Board Composition Committee and a member of
the Audit and Compensation and Management Development Committees of the Board.
He served as Chief Executive Officer of Burlington Northern Inc. from 1980
through 1988. Mr. Bressler retired in October 1990 as Chairman of both
Burlington Northern Inc. and Burlington Resources Inc., positions he had held
since 1982 and 1989, respectively. He served as Chairman of the Plum Creek
Management Company from April 1989 to January 1993. He was Chairman of the El
Paso Natural Gas Company from October 1990 through December 1993. Mr. Bressler
is a director of H. F. Ahmanson and Company and General Mills, Inc. and is
active in a number of business and civic organizations.
- -------------------------------------------------------
JUDITH L. ESTRIN
President and
Chief Executive Officer,
Precept Software, Inc.,
Networking Software
Director Since 1994
Age 42
Ms. Estrin is a member of the Science and Technology Committee of the Board.
She has been President and Chief Executive Officer of Precept Software since
March 1995. Previously she served as Executive Vice President of Network
Computing Devices from July 1988 to October 1993 and as President and Chief
Executive Officer from October 1993 to September 1994. In 1981 she co-founded
Bridge Communications, serving initially as Vice President, Engineering and
subsequently as Executive Vice President and Senior Vice President and General
Manager of 3Com Corp.'s Bridge Communications Division after 3Com acquired
Bridge in September 1987. She also serves as a director of Federal Express
Corporation and Sun Microsystems, Inc.
JAMES CLAYBURN LA FORCE, JR.
Dean Emeritus,
John E. Anderson
Graduate School of
Management, University of
California, Los Angeles
Director Since 1980
Age 68
Dr. La Force is a member of the Audit, Environmental and Social Responsibility
and Science and Technology Committees of the Board. After joining the UCLA
faculty as an Assistant Professor of Economics in 1962, he became an Associate
Professor in 1967 and a full Professor in 1971. He was Chairman, Department of
Economics from 1969 until 1978, and Dean, John E. Anderson Graduate School of
Management from 1978 until June 1993. He is a director of The BlackRock Funds,
Eli Lilly & Company, Imperial Credit Industries, Inc., Jacobs Engineering Group,
Inc., Payden & Rygel Investment Trust, Provident Investment Council Mutual Funds
and The Timken Company.
- -------------------------------------------------------
JOHN D. NICHOLS
Retired Chairman of the Board
and Chief Executive Officer,
Illinois Tool Works Inc.,
Engineered Components
and Industrial Systems
and Consumables
Director Since 1988
Age 66
Mr. Nichols is Chairman of the Science and Technology Committee and a member
of the Audit and Compensation and Management Development Committees of the
Board. He joined Illinois Tool Works in 1980 as Executive Vice President and was
named President, Chief Operating Officer and a director in 1981 and Chairman in
1986. He served as Chief Executive Officer from 1982 through August 1995. From
1969 through 1979, he was Executive Vice President and Chief Operating Officer
of Aerojet-General Corporation. He is a director of Household International,
Philip Morris Companies Inc. and Stone Container Corp. He serves as Chairman of
the Art Institute of Chicago and an Overseer of Harvard University.
5
<PAGE> 10
CONTINUING DIRECTORS WITH TERMS EXPIRING IN 1998
LEW ALLEN, JR.
General, U.S. Air
Force (Retired)
Director Since 1991
Age 71
Dr. Allen is a member of the Science and Technology and Environmental and
Social Responsibility Committees of the Board. He served as Chairman of the
Board of The Charles Stark Draper Laboratory, Inc., from 1991 through November
1995 and as Vice President of the California Institute of Technology and
Director of its Jet Propulsion Laboratory from October 1982 through 1990.
Previously, he was Air Force Chief of Staff and Director of the National
Security Agency. A West Point graduate, he also holds a Ph.D. in physics from
the University of Illinois. Dr. Allen is a member of the National Academy of
Engineering and the Council on Foreign Relations and a director of the W. M.
Keck Foundation.
- -------------------------------------------------------
DON H. DAVIS, JR.
President and
Chief Operating Officer
Director Since 1995
Age 57
Mr. Davis was elected to his present position in July 1995. He joined
Allen-Bradley as an engineering sales trainee in 1963 and after serving in a
number of increasingly responsible management positions, became a Senior Vice
President in 1985 and President in July 1989. He was named Senior Vice
President--Automation of the Corporation in June 1993 and an Executive Vice
President and Chief Operating Officer in January 1994. Mr. Davis is a director
of Ingram Micro, Inc. and Sybron Corporation. He is Chairman of the Board of
Governors of the National Electrical Manufacturers Association and is also a
director, trustee or member of a number of other business, educational and civic
organizations.
WILLIAM H. GRAY, III
President and
Chief Executive Officer,
The College Fund/UNCF
(formerly, United Negro
College Fund)
Educational Assistance
Director Since 1994
Age 55
Mr. Gray is a member of the Board Composition and Environmental and Social
Responsibility Committees of the Board. He has been President of The College
Fund/UNCF since September 1991 and senior minister, Bright Hope Baptist Church
in Philadelphia since 1972. He served in Congress from 1979 to 1991, as House
Majority Whip, Chair of the Democratic Caucus and the House Budget Committee and
on the House Appropriations Committee. In addition, he has taught at St. Peter's
College and Temple University. Mr. Gray is a director of Chase Manhattan
Corporation, MBIA, Inc., Prudential Insurance Company of America, Union Pacific
Corporation, Warner-Lambert Company and Westinghouse Electric Corporation.
- -------------------------------------------------------
WILLIAM T. MCCORMICK, JR.
Chairman of the Board and
Chief Executive Officer,
CMS Energy Corporation,
Diversified Energy
Company
Director Since 1989
Age 52
Mr. McCormick is a member of the Compensation and Management Development and
Science and Technology Committees of the Board. He has been Chairman of the
Board and Chief Executive Officer of CMS Energy Corporation since November 1985.
Before joining CMS, he had been Chairman and Chief Executive Officer of American
Natural Resources Company and Executive Vice President and a director of its
parent corporation, The Coastal Corporation. Mr. McCormick is a director of
First Chicago NBD, Inc. and Schlumberger Ltd. Among his other activities, he
serves as a director of the American Gas Association, the Edison Electric
Institute and the National Petroleum Council.
6
<PAGE> 11
CONTINUING DIRECTORS WITH TERMS EXPIRING IN 1999
DONALD R. BEALL
Chairman of the Board
and Chief Executive Officer
Director Since 1978
Age 58
Mr. Beall was elected to his present position in February 1988 after serving
nine years as President and Chief Operating Officer and in a number of other
increasingly responsible senior management positions since joining the
Corporation in 1968. He is a member of the Board Composition Committee of the
Board and a director of Amoco Corporation, The Procter & Gamble Company and The
Times Mirror Company. He is a trustee of the California Institute of Technology
and a member of the University of California-Irvine Board of Overseers and the
Board of Visitors of its Graduate School of Management as well as The Business
Council, The Business Roundtable, the Chief Executives' Organization and the
Council on Competitiveness.
- -------------------------------------------------------
BRUCE M. ROCKWELL
Senior Vice President,
First of Michigan
Corporation,
Investment Banking
Director Since 1969
Age 57
Mr. Rockwell is Chairman of the Environmental and Social Responsibility
Committee and a member of the Compensation and Management Development and Board
Composition Committees of the Board. He joined First of Michigan Corporation in
1961 and in 1965 was appointed Assistant Vice President and manager of the bond
underwriting department. Mr. Rockwell was elected Vice President in 1967, and
Senior Vice President-Fixed Income in 1983, assuming his present position in
April 1988. He is past chairman of the Municipal Advisory Council of Michigan
and past President of the Bond Club of Detroit. He also serves as a board member
of a number of civic and community organizations.
WILLIAM S. SNEATH
Retired Chairman of the Board
and Chief Executive Officer,
Union Carbide Corporation,
Chemicals
Director Since 1979
Age 70
Mr. Sneath is Chairman of the Compensation and Management Development
Committee and a member of the Audit and Board Composition Committees of the
Board. He joined Union Carbide Corporation in 1950, was elected Treasurer in
1961, became a Vice President and Chief Financial Officer in 1965, a director in
1969 and President and Chief Operating Officer in 1971. Mr. Sneath served as
Chairman of the Board and Chief Executive Officer of Union Carbide from January
1977 through December 1981. Mr. Sneath is a director of Union Carbide
Corporation and Metropolitan Life Insurance Company and is a member of The
Business Council.
- -------------------------------------------------------
JOSEPH F. TOOT, JR.
President and
Chief Executive Officer,
The Timken Company,
Tapered Roller Bearings
and Specialty Steel
Director Since 1977
Age 61
Mr. Toot is Chairman of the Audit Committee and a member of the Compensation
and Management Development and Board Composition Committees of the Board. He
joined The Timken Company in 1962 and served in various senior executive
positions until his election as Vice President-International Operations in 1967.
Mr. Toot became a director of Timken in 1968, was elected Executive Vice
President in 1973, President in 1979 and Chief Executive Officer in 1992. Mr.
Toot has also served as a director, officer, trustee or member of various
community, charitable and philanthropic organizations.
7
<PAGE> 12
BOARD OF DIRECTORS AND COMMITTEES
The business of the Corporation is managed by or under the direction of the
Board of Directors. The Board has established several committees whose principal
functions are briefly described below. In the 1996 fiscal year, the Board held
ten meetings. Average attendance by incumbent directors at Board and Committee
meetings was 94% and all of the directors attended 83% or more of the meetings
of the Board and the Committees on which they served.
The Audit Committee is composed of six non-employee directors. Among its
functions, it reviews the scope and effectiveness of audits of the Corporation
by the independent public accountants and by the Corporation's internal
auditors; selects and recommends to the Board of Directors the employment of
independent public accountants for the Corporation, subject to approval of the
shareowners; reviews the audit plans of the independent public accountants and
the Corporation's internal auditors; reviews and approves the fees charged by
the independent public accountants; reviews the Corporation's annual financial
statements before their release; reviews the adequacy of the Corporation's
system of internal controls and recommendations of the independent public
accountants with respect thereto; reviews and acts on comments and suggestions
by the independent public accountants and by the internal auditors with respect
to their audit activities; and monitors compliance by the employees of the
Corporation with the Corporation's standards of business conduct policies. The
Committee met four times during the 1996 fiscal year.
The principal functions of the Board Composition Committee are to consider and
recommend to the Board qualified candidates for election as directors of the
Corporation and periodically to prepare and submit to the Board for adoption the
Committee's selection criteria for director nominees. The Committee also
periodically assesses the performance of the Board of Directors and reports
thereon to the Board. The Committee, which is composed of five non-employee
directors and Mr. Beall, met once during the 1996 fiscal year. Shareowners
wishing to recommend candidates for consideration by the Committee can do so by
writing to the Secretary of the Corporation at its World Headquarters in Seal
Beach, California, giving the candidate's name, biographical data and
qualifications. Any such recommendation should be accompanied by a written
statement from the individual of his or her consent to be named as a candidate
and, if nominated and elected, to serve as a director.
The six members of the Compensation and Management Development Committee are
non-employee directors and are ineligible to participate in any of the plans or
programs which are administered by the Committee except the Directors Stock
Plan. The principal functions of the Compensation and Management Development
Committee are to evaluate the performance of the Corporation's senior executives
and plans for management succession and development, to consider the design and
competitiveness of the Corporation's compensation plans, to review and approve
senior executive compensation and to administer the Corporation's incentive,
deferred compensation, stock option and long-term incentives plans including the
Annual Incentive Compensation Plan for Senior Executive Officers, pursuant to
the terms of the respective plans. The Committee met four times during the 1996
fiscal year.
The Environmental and Social Responsibility Committee, which is composed of
five non-employee directors, reviews and assesses the Corporation's policies and
practices in the following areas: employee relations, with emphasis on equal
employment opportunity and advancement; the protection and enhancement of the
environment and energy resources; product integrity and safety; employee health
and safety; and community and civic relations including programs for and
contributions to health, educational, cultural and other social institutions.
The Committee met two times during the 1996 fiscal year.
The principal function of the Science and Technology Committee, which is
composed of five non-employee directors, is to review and monitor science and
technological activities of the Corporation. The Committee met twice during the
1996 fiscal year.
During the 1996 fiscal year, non-employee directors of the Corporation
received an annual retainer of $33,000 for Board service, together with a
retainer for service on each Board committee at the annual rate of $4,000
($5,000 for Chairmen) for service on the Audit and Compensation and Management
Development Committees and $2,000 ($3,000 for Chairmen) for service on each
other Board commit-
8
<PAGE> 13
tee. Each non-employee director also received a grant of 400 shares of Common
Stock immediately after the 1996 Annual Meeting of Shareowners. At the same
date, Messrs. Bressler, Nichols and Toot received grants of options under the
Directors Stock Plan to purchase 9,000, 9,000 and 5,000 shares, respectively, of
Common Stock, and each other non-employee director (other than Messrs. Allen,
Creedon, La Force and Sneath, who are ineligible by reason of age for option
grants under that Plan) received a grant of options under that Plan to purchase
1,000 shares of Common Stock. In accordance with the Directors Stock Plan, those
options were exercisable at $60.875 per share, the closing market price on the
date of grant, and become exercisable in three substantially equal installments
on the first, second and third anniversaries of the grant date. In connection
with the reorganization of the Corporation on December 6, 1996, all outstanding
stock options under the Corporation's plans, including the Directors Stock Plan,
were adjusted to preserve the intrinsic value of those options. As a result, the
options granted under the Directors Stock Plan in 1996 now entitle Messrs.
Bressler, Nichols, Toot and each other director to whom a grant was made to
purchase 9,584, 9,584. 5,324 and 1,064 shares, respectively, for $57.1612 per
share. Ms. Estrin, who serves on one Board Committee, also receives a retainer
of $5,000 per year for serving as a technology adviser. The average of retainer
fees paid or deferred to non-employee directors for the 1996 fiscal year was
$61,260 (including valuing the February 1996 stock grant at $60.875 per share,
the closing price on the date the shares were issued). In addition, the stock
options granted under the Directors Stock Plan would have had a grant date value
of $13.73 per option share based on the Black-Scholes option pricing methodology
using the following assumptions and inputs: options exercised after 7 1/2 years,
weighted five-year stock price volatility and dividend yield of 0.1806 and
2.81%, respectively, and an interest rate of 5.53%, which was the zero coupon
7 1/2 year Treasury bond rate at the date of grant.
Under the terms of the directors' deferred compensation plan, a director may
elect to defer all or part of the cash payment of retainer fees until such time
as shall be specified, with interest on deferred amounts accruing quarterly at
120% of the federal long-term rate set each month by the Secretary of the
Treasury. In addition, under the Directors Stock Plan, each director has the
opportunity each year to defer all the annual grant of shares and all or any
portion of the cash retainers by electing to receive restricted shares valued at
the closing price of the New York Stock Exchange--Composite Transactions on the
date of the annual grant and the date each retainer payment would otherwise be
made in cash.
Under the directors' retirement policy in effect prior to December 1995 and
continued only for then retired directors and then current directors who were at
least age 67 (Messrs. Allen, Creedon, La Force and Sneath) and thus not eligible
to receive stock option grants under the Directors Stock Plan, the Corporation
enters into consulting agreements with retired directors who had at least five
years of Board service and had not been employees of the Corporation during the
ten years prior to retirement. The consulting agreements provide an annual fee
equal to the Board retainer fee and continue for the lesser of ten years (or if
less, the number of years of Board service of a director who retires before age
72) or life.
CERTAIN TRANSACTIONS AND OTHER RELATIONSHIPS
The Corporation and its subsidiaries during the 1996 fiscal year had sales and
purchase transactions in the normal course of business with unaffiliated
companies with which some of the Corporation's directors are associated in their
principal occupations in the following approximate amounts: purchases of
$122,000 from and sales of $449,000 to CMS Energy Corporation and purchases of
$58,012,000 from and sales of $2,332,000 to The Timken Company. Based on the
Corporation's knowledge of prevailing market conditions and prices for the goods
and services involved, the Corporation believes that such transactions were on
terms as favorable to the Corporation as those which might have been obtained
from entities with which directors of the Corporation were not associated.
9
<PAGE> 14
OWNERSHIP BY MANAGEMENT OF EQUITY SECURITIES
The following table shows the beneficial ownership, reported to the
Corporation as of December 9, 1996, of the Corporation's Common Stock and Class
A Common Stock, including shares as to which a right to acquire ownership exists
(for example, through the exercise of stock options, conversions of securities
or through various trust arrangements) within the meaning of Rule 13d-3(d)(1)
under the Securities Exchange Act, of each director, each executive officer
listed in the table on page 11 and, as a group, of such persons and other
executive officers.
<TABLE>
<CAPTION>
Beneficial Ownership on December 9, 1996
------------------------------------------------------------------------------------------
Common Class A Total
--------------------------- ------------------------ ---------------------------
Percent of Percent of Percent of
Name Shares(1) Class(2) Shares(1) Class(2) Shares(1) Class(2)
- ------------------------------------ --------- ---------- --------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Lew Allen, Jr....................... 2,400 (3) -- -- -- 2,400(3) --
Donald R. Beall..................... 1,246,587 (4:5:6) 0.6 114,151(4:5:6) 0.4 1,360,738(4:5:6) 0.6
Richard M. Bressler................. 5,394 -- -- -- 5,394 --
John J. Creedon..................... 3,241 -- -- -- 3,241 --
Don H. Davis, Jr.................... 330,724 (4:5:7) 0.2 10(4) -- 330,734(4:5:7) 0.2
Judith L. Estrin.................... 1,354 -- -- -- 1,354 --
William H. Gray, III................ 1,700 (8) -- -- -- 1,700(8) --
James Clayburn LaForce, Jr.......... 2,300 (3:8) -- -- -- 2,300(3:8) --
William T. McCormick, Jr............ 6,554 (8) -- -- -- 6,554(8) --
John D. Nichols..................... 5,894 -- -- -- 5,894 --
Bruce M. Rockwell................... 17,612 -- 24,254 -- 41,866 --
William S. Sneath................... 3,000 -- 800 -- 3,800 --
Joseph F. Toot, Jr.................. 8,049 -- 4,925 -- 12,974 --
W. Michael Barnes................... 329,866 (4:5:8) 0.2 35,579(4) -- 365,445(4:5:8) 0.2
Jodie K. Glore...................... 62,594 (4:5) -- --(4) -- 62,594(4:5) --
John A. McLuckey.................... 225,645 (4:5) 0.1 648(4) -- 226,293(4:5) 0.1
All of the above and other executive
officers as a group (28 persons)... 3,082,616 (3:4:5:8) 1.6 219,456(3:4:5) 0.8 3,302,072(3:4:5:8) 1.5
</TABLE>
(1) Each person has sole voting and investment power with respect to the shares
listed unless otherwise indicated.
(2) The shares owned by each person, and by the group, and the shares included
in the number of shares outstanding have been adjusted, and the percentage
of shares owned (where such percentage exceeds 0.1%) has been computed, in
accordance with Rule 13d-3(d)(1) under the Securities Exchange Act, except
that in the columns under the heading "Common", the Common shares owned and
the related percentages do not include Class A shares convertible into
Common shares.
(3) Includes shares held jointly, or in other capacities, as to which in some
cases beneficial ownership is disclaimed.
(4) Includes shares held under the Corporation's savings plans as of November
30, 1996. Does not include 9,794, 3,429, 1,163, 423, 2,220 and 20,366 share
equivalents for Messrs. Beall, Davis, Barnes, Glore, McLuckey and the group,
respectively, held under the Corporation's supplemental savings plans as of
November 30, 1996.
(5) Includes shares which may be acquired upon the exercise of outstanding stock
options as follows: 895,778, 3,194, 285,051, 354, 354, 354, 3,194, 354,
1,774, 280,436, 51,471, 198,791 and 2,424,497 Common shares for Messrs.
Beall, Bressler, Davis, Ms. Estrin, Messrs. Gray, McCormick, Nichols,
Rockwell, Toot, Barnes, Glore, McLuckey and the group, respectively, and
5,857 Class A shares for the group.
(6) Includes shares, as to which beneficial ownership is disclaimed, as follows:
207,428 Common shares (including 190,000 shares underlying stock options)
and 2,068 Class A shares held for the benefit of family members and 10,000
Common shares owned by the Beall Family Foundation, of which Mr. Beall is
President and a director. Does not include 157,200 Common shares that may be
acquired on exercise of stock options assigned to family members who are the
beneficial owners.
(7) Includes 14,166 Common shares granted as restricted stock in partial payment
of a bonus for fiscal year 1995 and a long-term incentive payment earned for
a three-year performance period ended September 30, 1995.
(8) Includes 167, 400 and 400 shares granted as restricted stock under the
Directors Stock Plan for Messrs. Gray, LaForce and McCormick, respectively,
and 4,000 and 8,000 shares granted in December 1996 as restricted stock
under the 1995 Long-Term Incentives Plan for Mr. Barnes and the group,
respectively.
10
<PAGE> 15
EXECUTIVE COMPENSATION
There is shown below information concerning the annual and long-term
compensation for services in all capacities to the Corporation for the fiscal
years ended September 30, 1996, 1995 and 1994, of those persons who were (i) the
chief executive officer at any time during fiscal 1996, (ii) the other four most
highly compensated executive officers of the Corporation at September 30, 1996
and (iii) any other persons who were executive officers at any time during
fiscal 1996 and would have been included under clause (ii) if they had remained
executive officers at September 30, 1996 (the Named Officers):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
All Other
Long-Term Compensation Compensation(1)
----------------------- ---------------
Annual Compensation Awards(2) Payouts
------------------------------------------------ --------- -------
Other Stock Long-Term
Annual Options Incentive
Name and Principal Position Year Salary Bonus(3) Compensation (Shares) Payouts(4)
- ----------------------------- ----- -------- ---------- --------------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Donald R. Beall.............. 1996 $907,500 $2,000,000 $99,493 265,000 $ -0- $ 180,260
Chairman of the Board 1995 815,000 2,000,000 36,611 240,000 -0- 203,008
& Chief Executive Officer 1994 815,000 1,300,000 25,054 190,000 -0- 57,745
Don H. Davis, Jr............. 1996 600,000 760,000 35,189 125,000 -0- 57,234
President & Chief 1995 530,000 660,000(6) 425,566(7) 105,000 525,000(6) 43,575
Operating Officer(5) 1994 440,000 480,000 32,454 80,000 314,900 16,002
W. Michael Barnes............ 1996 393,333 475,000 25,220 80,000 -0- 37,406
Senior Vice President, 1995 360,000 420,000 20,459 70,000 -0- 32,611
Finance & Planning 1994 323,333 330,000 21,363 60,000 -0- 19,609
& Chief Financial Officer
Jodie K. Glore............... 1996 361,667 300,000 16,596 40,000 560,000 23,620
Senior Vice President 1995 318,333 375,000 49,455 30,000 337,501 9,186
and President and 1994 267,333 277,333 6,227 15,000 183,520 6,033
Chief Operating Officer,
Rockwell Automation(8)
John A. McLuckey............. 1996 410,771 400,000(9) 29,081 40,000 740,066 41,577
Senior Vice President 1995 365,000 360,000 56,530 35,000 -0- 35,761
and President and 1994 343,174 330,000 25,078 30,000 -0- 21,581
Chief Operating Officer,
Aerospace & Defense(10)
</TABLE>
- ---------
(1) Amounts contributed or accrued for fiscal years 1996, 1995 and 1994 for the
Named Officers (other than Mr. Glore) under the Corporation's Savings Plan
and the related supplemental savings plan and amounts contributed or
accrued for Mr. Glore under Allen-Bradley's Employee Savings Plan for
Salaried Employees and the related supplemental savings plan.
(2) Although the Corporation's Long-Term Incentives Plans permit grants of
restricted stock and freestanding stock appreciation rights, no grants of
those incentives were made under these Plans during fiscal years 1996, 1995
or 1994. See Note (6) for information on restricted stock granted Mr. Davis
in partial payment of his bonus for fiscal year 1995 and a long-term
incentive payment for a three-year performance period ended September 30,
1995.
(3) Amounts awarded under the Annual Incentive Compensation Plan for Senior
Executive Officers for Messrs. Beall, Davis, Barnes and Glore for fiscal
1996, under the Incentive Compensation Plan for Messrs. Beall, Davis,
Barnes and McLuckey for fiscal 1995 and 1994 and for Mr. McLuckey for
fiscal 1996 and, under Allen-Bradley's Management Incentive Plan for Mr.
Glore for fiscal 1995 and 1994, even if deferred. See Note (9) for
information on closure, retention and severance payments paid or payable to
Mr. McLuckey in connection with the divestiture of the Corporation's
Aerospace and Defense businesses.
(4) For Messrs. Davis and Glore, cash and market value of Common Stock paid in
respect of performance units granted under Allen-Bradley's Supplementary
Performance Unit Plan for the three-year performance periods ended
September 30, 1996, 1995 and 1994. For Mr. McLuckey, cash to be paid by
Boeing North American, Inc. (Boeing NA) in January 1997 in respect of
performance units granted under business unit performance plans for the
three-year performance period ended September 30, 1996 and for three-year
performance periods ending September 30, 1997 and 1998 which were
terminated effective September 30, 1996.
(5) Executive Vice President & Chief Operating Officer from January 1994 until
July 1995; Senior Vice President--Automation and President, Allen-Bradley
prior thereto.
(6) Mr. Davis's bonus for fiscal year 1995 and a long-term incentive payment
for a three-year performance period ended September 30, 1995 were paid in
part by the delivery to him of 14,166 shares of restricted Common Stock
valued at the closing price on the New York Stock Exchange--Composite
Transactions on December 6, 1995, the date of the incentive compensation
award and payment ($51.875).
11
<PAGE> 16
(7) Includes amounts paid in connection with the relocation of Mr. Davis from
Milwaukee, Wisconsin to the Corporation's World Headquarters in Seal Beach,
California, consisting of $252,081 in respect of a portion of the loss on
the sale of his residence in Milwaukee and $146,115 in respect of taxes
incurred on certain payments under the Corporation's relocation policy.
These amounts were paid in addition to amounts payable under the
Corporation's relocation policy applicable to all salaried employees.
(8) President of Allen-Bradley from January 1994 to October 1995; Senior Vice
President, Automation Group (formerly Industrial Computer and
Communications Group) of Allen-Bradley prior thereto.
(9) Does not include a closure payment of $300,000 paid to Mr. McLuckey by the
Corporation following consummation of the divestiture of the Aerospace and
Defense businesses on December 6, 1996 pursuant to the Key Executive
Retention and Severance Program extended to certain key executives of those
businesses during fiscal 1996. In addition, Mr. McLuckey may become
entitled under that Program to receive from Boeing NA certain retention or
severance payments. If he remains employed by Boeing NA through December 6,
1997, he will be entitled to receive a retention payment of $830,000. If he
is involuntarily terminated (other than for cause) by Boeing NA or
voluntarily terminates after a significant diminution in his
responsibilities, he will be entitled to a severance payment of $1,245,000
if his termination occurs before December 6, 1997 and $415,000 if his
termination occurs after that date and before December 6, 1998.
(10) Senior Vice President and President, Defense Systems prior to September
1995. Mr. McLuckey became President of Boeing NA after December 6, 1996 and
has not been an executive officer of the Corporation since that date.
OPTION GRANTS
Shown below is further information on grants to the Named Officers of stock
options pursuant to the 1995 Long-Term Incentives Plan during the fiscal year
ended September 30, 1996, which are reflected in the Summary Compensation Table
on page 11. No stock appreciation rights were granted during fiscal 1996.
<TABLE>
<CAPTION>
Individual Grants
- ---------------------------------------------------------------------------------------------------
Number of
Securities Percentage of Grant Date
Underlying Total Options Value
Options Granted to Exercise or ----------------
Granted Employees in Base Price Expiration Grant Date
Name (Shares)(1) Fiscal 1996 (Per Share) Date Present Value(2)
- ------------------------------------- ------------- ------------- ----------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Donald R. Beall...................... 265,000 14.6% $51.875 12/6/05 $3,100,500
Don H. Davis, Jr..................... 125,000 6.9% 51.875 12/6/05 1,462,500
W. Michael Barnes.................... 80,000 4.4% 51.875 12/6/05 936,000
Jodie K. Glore....................... 40,000 2.2% 51.875 12/6/05 468,000
John A. McLuckey..................... 40,000 2.2% 51.875 12/6/05 468,000
</TABLE>
- ---------
(1) All options granted to the Named Officers were granted on December 6, 1995
and the first of three substantially equal installments became exercisable
December 6, 1996.
(2) These values are based on the Black-Scholes option pricing model which
produces a per option share value of $11.70 using the following assumptions
and inputs: options exercised after 7 1/2 years, weighted five-year prior
stock price volatility and dividend yield of 0.1762 and 2.86%, respectively,
and an interest rate of 5.72%, which was the zero coupon 7 1/2-year Treasury
bond rate at date of grant. The actual value, if any, the executive officer
may realize from these options will depend solely on the gain in stock price
over the exercise price when the options are exercised.
The Black-Scholes option pricing methodology, on which the present value of
the stock options granted to the Named Officers is based, attempts to portray
the value of an option at the date of grant. While the options have no value if
the stock price does not increase, were the $11.70 present value of the options
converted into a future stock price at the end of the 7 1/2-year period when it
is assumed the options would be exercised, the shareowners of the approximately
217 million shares outstanding on the grant date of those options (assuming that
number of shares remains outstanding) would realize aggregate appreciation of
$3,854.8 million compared to aggregate appreciation on the options of $6.9
million for the Named Officers (assuming that they held their options or the
shares acquired on exercise thereof for the whole 7 1/2-year period).
12
<PAGE> 17
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END VALUES
Shown below is information with respect to (i) exercises by the Named Officers
during fiscal 1996 of options to purchase the Corporation's Common Stock or
Class A Common Stock granted under the 1988 Long-Term Incentives Plan and the
1981 Incentive Stock Option Plan for Key Employees and (ii) the unexercised
options to purchase the Corporation's Common Stock or Class A Common Stock
granted to the Named Officers in fiscal 1996 and prior years under the 1995
Long-Term Incentives Plan and the 1988 Long-Term Incentives Plan and held by
them at September 30, 1996.
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options Held At In-the-Money Options At
Shares September 30, 1996 September 30, 1996(1)
Acquired Value ------------------------------ -------------------------------
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ------------------------ ------------ -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Donald R. Beall......... 10,060 $324,042 752,800(2:3) 265,000(3) $19,749,350(2:3) $ 1,192,500(3)
Don H. Davis, Jr........ -- -- 191,000 125,000(3) 4,593,125 1,392,500(3)
W. Michael Barnes....... 3,000 102,375 213,333 126,667 5,392,410 1,328,340
Jodie K. Glore.......... -- -- 25,000 60,000 425,000 595,000
John A. McLuckey........ -- -- 161,666 63,334 4,359,820 664,180
</TABLE>
- ---------
(1) Based on the closing price on the New York Stock Exchange--Composite
Transactions of the Corporation's Common Stock on September 30, 1996, the
last trading day in that month ($56.375).
(2) Includes 190,000 options with a value of $4,251,250, held by Mr. Beall for
the benefit of family members and as to which beneficial ownership is
therefore disclaimed.
(3) Excludes options for 237,200 (of which 160,000 were unexercisable) and
30,000 Common shares granted to Messrs. Beall and Davis, respectively,
during fiscal 1995 that have been assigned to or for the benefit of family
members and are not attributable to them pursuant to Rule 13d-3(d)(1) under
the Securities Exchange Act.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation and Management Development Committee of the Board of
Directors, which consists entirely of non-employee directors (see page 8), has
furnished the following report on executive compensation:
COMPENSATION PHILOSOPHY AND OBJECTIVES
Under the Committee's supervision, the Corporation has developed and
implemented compensation policies, plans and programs intended to "pay for
performance" through meeting three fundamental objectives:
- foster the creation of shareowner value through close alignment of the
financial interests of executives with those of the Corporation's
shareowners
- recognize individual and team performance through evaluation of each
executive's effectiveness in meeting strategic and operating plan goals
- pay competitively to attract, retain and motivate the high caliber of
executives necessary for the Corporation's continuing leadership and growth
EMPLOYEE STOCK OWNERSHIP
The Committee believes the focus on "pay for performance" is sharpened by
aligning closely the financial interests of the Corporation's key executives
with those of the shareowners. Accordingly, it has set the following minimum
Ownership Guidelines (multiple of base salary):
<TABLE>
<CAPTION>
COMMON STOCK
MARKET VALUE
-------------
<S> <C>
- Chief Executive Officer 8
- President and Executive
Vice President 5
- Major Business Unit Heads
and Senior Vice
Presidents 3
- Other Business Unit Heads
and other senior
executives 1.5
</TABLE>
Only shares owned directly (including restricted shares) or through the
Corporation's savings plans, but not shares subject to unexercised stock
options,
13
<PAGE> 18
are considered for determining whether an executive meets the Guidelines. At
December 9, 1996, the 29 executives subject to the Guidelines owned an aggregate
of 1,007,760 shares (including share equivalents under the Corporation's
supplemental savings plans) of the Corporation's Common Stock, with an aggregate
market value of $62.0 million. The ownership by 62% of the executives meets the
Guidelines. All of the 12 executives who do not meet the Guidelines had received
a significant promotion or were newly hired and thus were within the transition
period for meeting the Guidelines (five years after the date the Guidelines are
applicable to them or within eight years in case of a significant promotion or a
newly hired executive).
COMPONENTS OF THE CORPORATION'S
COMPENSATION PLANS
- Strategy--In order to carry out its "pay for performance" philosophy, the
Committee sets base salaries generally somewhat below the median of other major
U.S. industrial companies, and provides opportunity for above-median
compensation through the Corporation's annual and long-term incentive plans
which depend heavily on corporate, business unit and individual performance. The
Committee considers the total compensation (earned or potentially available) of
each of the Named Officers and the other senior executives in establishing each
element of compensation. For the Named Officers, base compensation in a period
of acceptable performance (both by the individual and the Corporation) would
constitute about 20 to 30%, annual incentives about 20 to 30%, and long-term
incentives about 40 to 55% of total compensation.
In its deliberations, the Committee reviews data from industry, peer group and
national surveys of other major U.S. industrial companies. The surveys used by
the Corporation provide reference data on large samples of industrial companies
participating in national surveys that include 31 (57%) of the companies (in
addition to the Corporation) included in the S&P Technology Index (the
Technology Index) and all of the companies included in the S&P Electrical
Equipment Index (the Electrical Equipment Index), a group of 11 diversified
large industrial companies (five and two of which are included in the Technology
Index and Electrical Equipment Index, respectively) that the Corporation
believes compete with its businesses, and a group of 25 large industrial
companies (six and three of which in addition to the Corporation are included in
the Technology Index and Electrical Equipment Index, respectively) that through
compensation consultants share relevant data. In addition, the Committee reviews
data on a less frequent basis from a group of 15 diversified large industrial
companies, seven and three of which are included in the Technology Index and
Electrical Equipment Index, respectively. In determining the components of
compensation based in part on survey and peer-company data, the Committee also
considers the performance of other companies whose data is included in such
surveys.
The Committee periodically is advised by independent compensation consultants
concerning the Corporation's compensation programs in comparison to those of
other companies which the consultants believe compete with the Corporation for
executive talent.
Under Internal Revenue Code Section 162(m), a publicly held company may not
deduct in any taxable year compensation in excess of one million dollars paid in
that year to its Named Officers unless the compensation is "performance based".
Grants of stock options and awards under the Annual Incentive Compensation Plan
for Senior Executive Officers are considered "performance based" compensation.
Since the Committee retains discretion to fix the specific amounts of base
salaries and awards under the Incentive Compensation Plan for the officers
covered under that Plan, those elements would not qualify as "performance based"
compensation for these purposes. Accordingly, to avoid loss of the tax
deduction, the Committee has adopted a formal policy whereby any portion of the
base, incentive or other compensation of any person whose compensation is
subject to the limitation on deductibility under Section 162(m) exceeds one
million dollars shall be deferred until the executive's retirement or other
termination of employment. In accordance with that policy, Mr. Davis received
14,166 shares of restricted stock that will vest after his retirement from the
Corporation or under certain other permitted circumstances for the excess over
one million dollars of his fiscal 1995 base salary, incentive awards and other
compensation (exclud-
14
<PAGE> 19
ing amounts related to relocation). Since Mr. Davis relocated at the
Corporation's request, the Committee determined that the foregoing policy should
not be applicable to amounts paid to him in respect of his relocation.
- Base Salary--In the early part of each fiscal year, the Committee reviews
with the Chief Executive Officer, the President and the senior human resources
executive and approves, with any modifications it deems appropriate, an annual
salary plan for the Corporation's senior executives (other than the Chief
Executive Officer and the President). This salary plan is developed based on the
survey data and consultants' reports described above and performance judgments
as to the past and expected future contributions of the individual senior
executives.
- Annual Incentives--Near the beginning of each fiscal year, the Committee
reviews with the Chief Executive Officer and the President the Corporate Goals
and Objectives for that year, including measurable financial return and
shareowner value creation objectives as well as long-term leadership goals that
in part require more subjective assessments. Principal 1996 financial goals
included increasing earnings per share above fiscal 1995, achieving a return on
equity of 20% and generating sufficient operating cash flow to provide at least
$1,050 million for dividends, acquisitions, debt reduction and share
repurchases. In 1996 the Corporation achieved a primary earnings per share
increase of 20% (excluding extraordinary items), a return on equity of 21% and
had operating cash flow of almost $1,300 million. Shareowner value goals for
1996 included achieving a total return (stock price appreciation and dividends)
exceeding over the long term a composite of the peer companies selected by the
Corporation, and utilizing inter-business sharing of competencies, technology,
product development and facilities to achieve added leverage for competitive
advantage. The Corporation's long-term goals included (i) the strategic
repositioning of the Corporation's business portfolio and (ii) developing new
products, investing in new technologies and taking the management
actions--focused on promoting teamwork, organizational effectiveness,
streamlining and empowerment--essential to assuring quality, reduced product
cycle times and enhanced customer responsiveness.
After the end of the year, performance against the Corporate Goals and
Objectives is evaluated and the results are considered by the Committee in
awarding annual incentive compensation (see "Bonus" in the table on page 11) to
corporate executives who were not directly responsible for the management of a
business unit. Individual awards to members of the senior management group,
including the Named Officers other than the Chief Executive Officer and the
President, are determined by the Committee after reviewing with the Chief
Executive Officer and the President the recommended awards, taking into account
the contributions made and the levels of responsibility of each of the
participants. While the Committee believes achievement of the financial,
shareowner value and long-term leadership goals are each important, it accords
greater significance to the first two in determining the total amount available
for annual incentive payments.
The incentive compensation for executives responsible for the management of
business units is determined by the extent to which the respective business unit
achieves goals established at the beginning of each year tailored to the
particular business unit. For two of the business units, the measure is
performance profit after taxes and other performance measures; for one of the
units, it is determined by year-over-year sales growth and current-year return
on sales, measured through a performance matrix; and for three of the
businesses, the measure is determined by year-over-year sales growth and
current-year returns on sales and assets. Achievement of established goals is
intended to provide incentive compensation at or above 100% of target levels
established through broad industry surveys; and these business unit plans
include significant upward and downward leverage dependent on performance. In
fiscal year 1996, the annual incentive compensation for executives for all six
major business units averaged 134% (and ranged from 121% to 240%) of target
incentive compensation levels since their performance met or exceeded
established goals. The Committee believes these average awards are about in the
median of companies with which the Corporation competes for executive talent.
Within each business unit, the amount earned by that unit
15
<PAGE> 20
under its plan is allocated among individual executives based on levels of
responsibility and an assessment of their individual performance by the business
unit President in consultation with the Chief Operating Officer.
The Annual Incentive Compensation Plan for Senior Executive Officers provides
the exclusive source of annual incentive compensation for the Chief Executive
Officer and four other senior executive officers who are designated by the
Committee before fiscal year end. Under that Plan, a Covered Employees
Performance Fund equal to 1% of the Corporation's net income before provision
for taxes on the Corporation's income is allocated 35% to the Chief Executive
Officer, 20% to the President and Chief Operating Officers and 15% to each other
covered senior executive officer, subject in each case to reduction at the
Committee's discretion. The Committee has administered and intends to continue
to administer the Plan so that each covered senior executive officer receives
annual incentive compensation that is consistent with the objective of providing
a competitive executive compensation program.
The amount available for annual incentives is determined for the Corporation's
other senior executives and other key management under the Corporation's
Incentive Compensation Plan or, for key Automation executives, under the
Automation Management Incentive Plan. Under the Corporation's Plan, the addition
to the incentive fund for a fiscal year cannot exceed either the aggregate
amount of dividends declared on the Corporation's outstanding stock during the
year or an aggregate amount computed by adding 2% of the first $100 million of
the applicable net earnings (defined as net income, before provision for
domestic and foreign taxes based on income, of the Corporation and its
consolidated subsidiaries) for the year, and 3% of the next $50 million of such
earnings, and 4% of the next $25 million of such earnings, and 5% of the balance
of such earnings. The incentive fund available for awards for any fiscal year is
reduced by the aggregate awards for that fiscal year under the Annual Incentive
Compensation Plan for Senior Executive Officers. Generally, the Committee makes
awards under the Corporation's Plan in an aggregate amount well below the amount
available thereunder. Under Automation's Management Incentive Plan, the amount
available for each Automation executive's annual incentive is determined by an
arithmetic formula based on Automation's annual sales growth and return on
sales; and actual awards are made upon assessment of the same factors as for
other business unit plans.
- Long-Term Incentives--The Corporation's 1995 Long-Term Incentives Plan
provides the flexibility to grant long-term incentives in a variety of forms,
including performance units, stock options, stock appreciation rights and
restricted stock. Annually the Committee evaluates the type of long-term
incentive it believes is most likely to achieve the Corporation's total
compensation objectives.
The Committee has established a performance unit plan covering one of the
Corporation's business units providing long-term compensation opportunities that
depend on achieving goals measured by its earnings and return on assets. The
Committee also established five plans under which potential compensation is
determined by achieving levels of sales growth, return on sales and return on
assets.
In determining the grants of stock options to the individual senior management
group, including the Named Officers other than the Chief Executive Officer, the
Committee reviewed with the Chief Executive Officer the recommended individual
awards, taking into account relevant survey data and the respective scope of
accountability, strategic and operational goals, and anticipated contributions
of each of the members of the senior management group. The long-term incentives
for Mr. Glore were provided one-half through stock option grants and one-half
through participation in the Allen-Bradley supplementary performance plan. The
presidents of other business units for which performance unit plans have been
established also were afforded one-half of their long-term incentive
opportunities under those plans and one-half through stock options, with the
other key executives of those units participating only in the business unit
plans.
The Allen-Bradley supplementary performance plan, under which Messrs. Davis,
when he was President of Allen-Bradley, and Glore received grants, produced
significant long-term compensation for the three-year performance periods ended
September 30, 1994, 1995 and 1996. (See "Long-
16
<PAGE> 21
Term Compensation--Payouts" in the table on page 11.)
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
In April 1996 the Committee increased Mr. Beall's base salary, which had been
in effect since March 1992, from $815,000 to $1,000,000. His total annual
compensation continues to be substantially dependent on annual incentive
compensation tied to the Committee's assessment of his and the Corporation's
performance.
In determining Mr. Beall's annual incentive compensation for 1996, the
Committee concluded that the Corporation had again, as in 1995, performed
exceptionally under Mr. Beall's leadership, exceeding its financial goals,
meeting its shareowner value creation goal (including particularly through the
strategic repositioning of the Corporation's business portfolio with the
disposition of its Aerospace & Defense and Graphic Systems businesses) and
making significant progress on each of its long-term leadership objectives.
Consistent with the Corporation's pay for performance philosophy, the Committee
recognized the second consecutive year of extraordinary performance by awarding
Mr. Beall the same incentive award as in 1995.
The Committee recognized Mr. Beall's continued strong leadership in pursuing
the Corporation's vision and in assuring its clear commitment to customer
responsiveness, quality, integrity, environmental responsibility and employment
of advanced management practices. Finally, the Committee considered levels of
total annual cash compensation from five surveys of other major U.S. industrial
companies (see "Components of the Corporation's Compensation Plans--Strategy" on
page 14); and it concluded that Mr. Beall's total cash compensation should
approximate the 75th percentile of those surveys, in view of Mr. Beall's and the
Corporation's performance as well as the fact that he had served longer as Chief
Executive Officer than a majority of the other chief executives whose
compensation data was included in the surveys.
In determining the number of options granted to Mr. Beall for fiscal 1996 as
future long-term incentives, the Committee took into account advice of
independent compensation consultants and levels of option grants based on data
as to long-term compensation (e.g., options, restricted stock, performance
plans) from two surveys of other major United States industrial companies. His
grant was at approximately the 75th percentile of the companies surveyed
according to the Sibson & Co. survey and the F.W. Cook & Co. Inc. survey. The
Committee also considered information on Mr. Beall's total compensation and
historical information regarding his long-term compensation opportunities, as
well as Mr. Beall's past and expected future contributions to the Corporation's
achievement of its long-term performance goals.
In December 1996, following the Committee's meeting, the Board in Executive
Session, as provided in the Corporation's Corporate Governance Guidelines,
received and discussed a report of the Committee that included an evaluation of
the Corporation's and Mr. Beall's performance in the 1996 fiscal year and the
Committee's recommended actions as to Mr. Beall's incentive compensation for
that year and long-term incentives granted to him in the form of stock options.
Compensation and Management
Development Committee
William S. Sneath, Chairman John D. Nichols
Richard M. Bressler Bruce M. Rockwell
William T. McCormick, Jr. Joseph F. Toot, Jr.
17
<PAGE> 22
SHAREOWNER RETURN PERFORMANCE PRESENTATION
Set forth below is a line graph comparing the cumulative total shareowner
return on the Corporation's Common Stock against the cumulative total return of
the S&P Composite-500 Stock Index, the S&P Electrical Equipment Index and the
S&P Technology Index for the period of five fiscal years which commenced October
1, 1991 and ended September 30, 1996, assuming in each case a fixed investment
of $100 at the respective closing prices on September 30, 1991 and reinvestment
of all dividends. In August 1996, S&P removed the Corporation from the
Aerospace/Defense industry group and added it to the Electrical Equipment
industry group. In view of the steadily diminishing importance of the Aerospace
and Defense businesses in the Corporation's business mix, and particularly in
view of the divestiture of those businesses, the Corporation's management
believes it appropriate to compare the Corporation's performance against the
Electrical Equipment Index in fiscal 1996 and subsequent years. In accordance
with applicable rules of the Securities and Exchange Commission, both Indexes
are shown for the five-year period ended September 30, 1996.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
ROCKWELL COMMON, S&P COMPOSITE-500, S&P TECHNOLOGY & S&P ELECTRICAL EQUIPMENT
INDICES
<TABLE>
<CAPTION>
S&P ELECTRICAL
MEASUREMENT PERIOD ROCKWELL EQUIPMENT S&P TECHNO
(FISCAL YEAR COVERED) COMMON INDEX S&P 500 INDEX LOGY INDEX
<S> <C> <C> <C> <C>
1991 100 100 100 100
1992 99.81 114.12 111.02 101.86
1993 145.31 135.52 124.15 122.86
1994 142.08 141.62 128.73 143.11
1995 201.22 182.94 167.02 225.77
1996 245.14 261.29 200.98 277.37
</TABLE>
* THE CUMULATIVE TOTAL RETURNS ON ROCKWELL COMMON STOCK AND EACH INDEX AS OF
EACH SEPTEMBER 30, 1992-1996 PLOTTED IN THE ABOVE GRAPH ARE AS FOLLOWS:
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995 1996
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Rockwell Common..................................... $100.00 $ 99.81 $145.31 $142.08 $201.22 $245.14
S&P 500 Index....................................... 100.00 111.02 124.15 128.73 167.02 200.98
S&P Electrical Equipment Index...................... 100.00 114.12 135.52 141.62 182.94 261.29
S&P Technology Index................................ 100.00 101.86 122.86 143.11 225.77 277.37
Closing market price at fiscal year end................ 26.50 25.50 36.00 34.25 47.25 56.375
Dividends per common share during fiscal year ended
September 30......................................... 0.86 0.92 0.96 1.02 1.08 1.16
</TABLE>
18
<PAGE> 23
RETIREMENT PLANS
The following table shows the estimated annual retirement benefits payable on
a straight life annuity basis to participating employees, including officers, in
the earnings and years of service classifications indicated, under the
Corporation's retirement plans which cover most officers and other salaried
employees on a non-contributory basis. Such benefits reflect a reduction to
recognize in part the Corporation's cost of Social Security benefits related to
service for the Corporation. The Corporation's plans also provide for the
payment of benefits to an employee's surviving spouse or other beneficiary.
<TABLE>
<CAPTION>
Average Estimated Annual Retirement Benefits for Years of Service Indicated
Annual -----------------------------------------------------------------------------------
Earnings 10 Years 15 Years 20 Years 25 Years 30 Years 35 Years
---------- -------- ---------- ---------- ---------- ---------- ----------
<S><C> <C> <C> <C> <C> <C> <C> <C>
$ 500,000 ..................... $132,095 $ 198,117 $ 210,272 $ 222,427 $ 234,582 $ 246,738
1,000,000 ..................... 265,445 398,117 422,772 447,427 472,082 496,738
1,500,000 ..................... 398,795 598,117 635,272 672,427 709,582 746,738
2,000,000 ..................... 532,145 798,117 847,772 897,427 947,082 996,738
2,500,000 ..................... 665,495 998,117 1,060,272 1,122,427 1,184,582 1,246,738
3,000,000 ..................... 798,845 1,198,117 1,272,772 1,347,427 1,422,082 1,496,738
3,500,000 ..................... 932,195 1,398,117 1,485,272 1,572,427 1,659,582 1,746,738
</TABLE>
Covered compensation includes salary and annual bonus. The calculation of
retirement benefits under the plans generally is based upon average earnings for
the highest five consecutive years of the ten years preceding retirement.
The credited years of service for Messrs. Beall, Davis, Barnes and McLuckey
are 28, 34, 28 and 37, respectively.
The following table shows the estimated annual retirement benefits payable on
a straight life annuity basis to participating employees of the Corporation's
Allen-Bradley Industrial Automation business, in the earnings and years of
service classifications indicated, under Allen-Bradley's retirement plans, which
cover certain Allen-Bradley officers, including Mr. Glore, on a non-contributory
basis. Such benefits reflect a reduction to recognize in part Allen-Bradley's
cost of Social Security benefits related to service for Allen-Bradley and also
reflect supplemental benefits payable out of Allen-Bradley's general funds to
provide eligible officers with at least 20 years of service an annual retirement
benefit that is at least 50% of final average covered compensation.
Allen-Bradley's plans also provide for the payment of benefits to an employee's
surviving spouse or other beneficiary.
<TABLE>
<CAPTION>
Average Estimated Annual Retirement Benefits for Years of Service Indicated
Annual -------------------------------------------------------------------------
Earnings 10 Years 15 Years 20 Years 25 Years 30 Years 35 Years
-------- -------- -------- -------- -------- -------- --------
<S><C> <C> <C> <C> <C> <C> <C> <C>
$300,000 ..................... $ 96,894 $127,529 $146,290 $146,290 $146,290 $166,243
500,000 ..................... 167,809 221,628 255,390 255,390 255,390 280,798
700,000 ..................... 238,724 315,727 364,490 364,490 364,490 395,353
900,000 ..................... 309,639 409,826 473,590 473,590 473,590 509,908
</TABLE>
Covered compensation includes salary and bonus. The calculation of retirement
benefits under the plans generally is based upon average earnings for the
highest five years of the ten years preceding retirement. Mr. Glore has 11
credited years of service.
In addition, Allen-Bradley plans provide that Mr. Glore's beneficiary is to
receive (a) continued payment of his base salary ($375,000 per year as of
September 1996) for ten years if he dies before age 65 while a participating
officer or (b) $1,000,000 if he dies after retirement under an Allen-Bradley
retirement plan.
19
<PAGE> 24
Sections 401(a)(17) and 415 of the Internal Revenue Code of 1986, as amended,
limit the annual benefits which may be paid from a tax-qualified retirement
plan. As permitted by the Employee Retirement Income Security Act of 1974, the
Corporation has supplemental plans which authorize the payment out of general
funds of the Corporation of any benefits calculated under provisions of the
applicable retirement plan which may be above the limits under these sections.
SELECTION OF AUDITORS
The directors of the Corporation have selected the firm of Deloitte & Touche
LLP as the auditors of the Corporation subject to the approval of the
shareowners. Deloitte & Touche LLP, and its predecessors, have acted for the
Corporation as auditors since 1934.
Before the Audit Committee recommended to the full Board the appointment of
Deloitte & Touche LLP, it carefully considered the qualifications of that firm,
including their performance in prior years and their reputation for integrity
and for competence in the fields of accounting and auditing.
The amount of the fees for general audit and tax services performed by
Deloitte & Touche LLP for the Corporation relating to the 1996 fiscal year was
approximately $7.6 million. Representatives of Deloitte & Touche LLP are
expected to be present at the meeting to respond to appropriate questions and to
make a statement if they desire to do so.
VOTE REQUIRED
The four nominees for election as directors to succeed the directors whose
terms expire at the 1997 Annual Meeting of Shareowners who receive the greatest
number of votes cast for the election of directors at that meeting by the
holders of the Corporation's Common Stock and Class A Common Stock, voting
together as one class, entitled to vote at the meeting, a quorum being present,
shall become directors at the conclusion of the tabulation of votes. An
affirmative vote of the holders of a majority of the voting power of the
Corporation's Common Stock and Class A Common Stock, voting together as one
class, present in person or represented by proxy and entitled to vote at the
meeting, a quorum being present, is necessary to approve the action proposed in
item (b) of the accompanying Notice of 1997 Annual Meeting of Shareowners.
Under Delaware law and the Corporation's Restated Certificate of Incorporation
and By-Laws, the aggregate number of votes entitled to be cast by all
shareowners present in person or represented by proxy at the meeting, whether
those shareowners vote "for", "against" or abstain from voting (including broker
non-votes), will be counted for purposes of determining the minimum number of
affirmative votes required for approval of item (b) and the total number of
votes cast "for" that matter will be counted for purposes of determining whether
sufficient affirmative votes have been cast. The shares of a shareowner who
abstains from voting on a matter or whose shares are not voted by reason of a
broker non-vote on a particular matter will be counted for purposes of
determining whether a quorum is present at the meeting so long as the shareowner
is present in person or represented by proxy. An abstention from voting or a
broker non-vote on a matter by a shareowner present in person or represented by
proxy at the meeting has no effect in the election of directors (assuming a
quorum is present) and has the same legal effect as a vote "against" any other
matter even though the shareowner or interested parties analyzing the results of
the voting may interpret such a vote differently.
20
<PAGE> 25
OTHER MATTERS
The Board of Directors does not know of any other matters which may be
presented at the meeting.
In the event of a vote on any matters other than those referred to in items (a)
and (b) of the accompanying Notice of 1997 Annual Meeting of Shareowners, it is
intended that proxies in the accompanying form will be voted thereon in
accordance with the judgment of the person or persons voting such proxies. The
Corporation contemplates sending to all shareowners after the meeting a report
of the action taken at the meeting.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act requires the Corporation's
officers and directors, and persons who own more than ten percent of a
registered class of the Corporation's equity securities, to file reports of
ownership and changes in ownership on Forms 3, 4 and 5 with the Securities and
Exchange Commission (SEC) and the New York Stock Exchange. Officers, directors
and greater than ten percent shareowners are required by SEC regulation to
furnish the Corporation with copies of all Forms 3, 4 and 5 they file.
Based solely on the Corporation's review of the copies of such forms it has
received and written representations from certain reporting persons confirming
that they were not required to file Forms 5 for specified fiscal years, the
Corporation believes that all its officers, directors and greater than ten
percent beneficial owners complied with all filing requirements applicable to
them with respect to transactions during fiscal 1996 except Mr. Gray and William
D. Fletcher. As a result of a clerical error, Mr. Gray filed one Form 4
reporting the sale of 200 common shares, not matched by any purchase in the
relevant periods, four business days after its due date. Shortly after Mr.
Fletcher's election as Senior Vice President, International and while in the
process of relocating his office and residence from Hong Kong to the
Corporation's World Headquarters, he filed one Form 4 reporting one transaction,
not matched by any opposite way transaction in the relevant time periods,
approximately one month after its due date.
ANNUAL REPORT
The Corporation's Annual Report on Form 10-K, including financial statements,
for the fiscal year ended September 30, 1996, is being mailed to shareowners
together with this Proxy Statement.
1998 SHAREOWNER PROPOSALS
To be eligible for inclusion in the Corporation's proxy statement, shareowner
proposals for the 1998 Annual Meeting of Shareowners must be received on or
before September 6, 1997 at the Office of the Secretary at the Corporation's
World Headquarters. In view of the announced intention that the Corporation's
World Headquarters be relocated to another location in Southern California
during the 1997 fiscal year, shareowner proposals also will be considered to be
timely submitted if received by that date at the administrative section of the
Office of the Secretary located at the Corporation's offices at 625 Liberty
Avenue, Pittsburgh, Pennsylvania 15222-3123.
EXPENSES OF SOLICITATION
The cost of the solicitation of proxies will be borne by the Corporation. In
addition to the use of the mails, proxies may be solicited personally, or by
telephone or by telegraph, by a few regular employees of the Corporation without
additional compensation. The Corporation does not expect to pay any compensation
for the solicitation of proxies but will reimburse brokers and other persons
holding stock in their names, or in the names of nominees, for their expenses
for sending proxy material to principals and obtaining their proxies.
January 3, 1997
21
<PAGE> 26
PROXY
ROCKWELL INTERNATIONAL CORPORATION
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints D.R. Beall, D.H. Davis and W.S. Sneath,
jointly and severally, proxies, with full power of substitution, to vote shares
of capital stock which the undersigned is entitled to vote at the Annual
Meeting of Shareowners to be held at the Westin William Penn Hotel, 530 William
Penn Place (at Mellon Square), Pittsburgh, Pennsylvania, on February 5, 1997,
or any adjournment thereof; such proxies being directed to vote as specified
or, if no specification is made, FOR the election of four nominees proposed for
election as directors with terms expiring at the Annual Meeting in 2000 and FOR
proposal (b), and to vote in accordance with their discretion on such other
matters as may properly come before the meeting.
To vote in accordance with the Board of Directors' recommendations just
sign and date the other side; no boxes need to be checked.
Comments:_____________________________________________________________
_____________________________________________________________
_____________________________________________________________
_____________________________________________________________
(If you have written in the above space, please mark
the "Comments" box on the other side)
(continued and to be signed, on the other side)
--------------
NO POSTAGE
NECESSARY
IF MAILED
IN THE
UNITED STATES
--------------
-----------------------------------------------
BUSINESS REPLY MAIL
FIRST CLASS MAIL PERMIT NO. 6796 PITTSBURGH, PA
-----------------------------------------------
POSTAGE WILL BE PAID BY THE ADDRESSEE
OFFICE OF THE SECRETARY
ROCKWELL INTERNATIONAL CORPORATION
625 LIBERTY AVE
PITTSBURGH, PA 15222-9363
FOLD AND DETACH HERE
<PAGE> 27
PLEASE MARK
YOUR VOTES AS [ X ]
INDICATED IN
THIS EXAMPLE
COMMENTS
NOTED ON [ ]
OTHER SIDE
Where a vote is not specified, the proxies will vote the shares represented by
the proxy FOR the election of directors and FOR proposal (b) and will vote in
accordance with their discretion on such other matters as may properly come
before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR (a) AND (b).
WITHHOLD
FOR AUTHORITY to vote
all nominees for all
listed nominees listed
(a) The election of four directors [ ] [ ]
Nominees: R.M. Bressler, J.L. Estrin,
J.C. La Force and J.D. Nichols
(Instruction: To withhold authority to
vote for any individual nominee, write
that nominee's name in the space
provided below.)
____________________________________________
(b) The selection of auditors FOR AGAINST ABSTAIN
[ ] [ ] [ ]
PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES
Signature _____________________ Signature if held jointly ____________________
Date: ________________________, 1997
In signing as attorney, executor, administrator, trustee or guardian,
please give full title as such, and, if signing for a corporation,
please give your title. When shares are in the name of more than one
person each should sign the proxy. PLEASE SIGN, DATE, AND RETURN THE
PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
FOLD AND DETACH HERE
LOGO
ADMITTANCE CARD REQUEST
IF YOU PLAN TO ATTEND the Annual Meeting of Shareowners to be held on
February 5, 1997, this form may be used to request an admittance card. Please
fill in your name(s) and address and promptly return the form. The envelope
provided for return of your proxy card may be used for this purpose or you may
tear off this business reply card and deposit it in the U.S. mail. Upon receipt
of your request and verification of your share ownership, an admittance card
will be sent to you.
I/WE PLAN TO ATTEND THE MEETING IN PITTSBURGH, PENNSYLVANIA.
Name(s) _____________________________________________________________________
Please Print or Type
Street Address ______________________________________________________________
City _____________________ State ________________________ Zip Code __________
FOLD AND DETACH HERE
<PAGE> 28
[LETTERHEAD]
WELLS FARGO
January 3, 1997
TO: PARTICIPANTS IN THE ROCKWELL INTERNATIONAL CORPORATION SAVINGS PLAN
In connection with the Rockwell International Corporation (Rockwell) Annual
Meeting of Shareowners to be held February 5, 1997, enclosed are the following:
o Rockwell Letter to Shareowners, Notice of 1997 Annual Meeting and
Proxy Statement, together with a Direction Card and a return
envelope
o Rockwell Annual Report on Form 10-K for the fiscal year ended
September 30, 1996
o Rockwell 1996 Annual Report
The enclosed Direction Card should be used to instruct us with respect to our
voting of the shares which we are holding for your account in the Rockwell
International Corporation Savings Plan.
Please sign, date and return the Direction Card in the enclosed pre-addressed
stamped envelope by January 31, 1997 so that we may vote the shares of Rockwell
International that are held for your account in accordance with your
instructions. If you do not complete and return the enclosed Direction Card by
the above date, Wells Fargo Bank, as Trustee, will vote such shares as it deems
proper.
Sincerely,
SUSANA R. RYAN
- --------------
Susana R. Ryan
Vice President
Enclosures
<PAGE> 29
DIRECTION CARD
ROCKWELL INTERNATIONAL CORPORATION SAVINGS PLAN
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell capital
stock held for my account in the Rockwell International Corporation Savings
Plan at the Annual Meeting of Shareowners of Rockwell International Corporation
to be held at the Westin William Penn Hotel, 530 William Penn Place (at Mellon
Square), Pittsburgh, Pennsylvania, on February 5, 1997, and at any adjournment
thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES FOR EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN CARD.
(CONTINUED, AND TO BE SIGNED, ON THE OTHER SIDE)
FOLD AND DETACH HERE
--------------
NO POSTAGE
NECESSARY
IF MAILED
IN THE
UNITED STATES
--------------
-----------------------------------------------
BUSINESS REPLY MAIL
FIRST CLASS MAIL PERMIT NO. 6796 PITTSBURGH, PA
-----------------------------------------------
POSTAGE WILL BE PAID BY THE ADDRESSEE
OFFICE OF THE SECRETARY
ROCKWELL INTERNATIONAL CORPORATION
625 LIBERTY AVE
PITTSBURGH, PA 15222-9363
FOLD AND DETACH HERE
<PAGE> 30
PLEASE MARK
YOUR VOTES AS [ X ]
INDICATED IN
THIS EXAMPLE
In the absence of an expressed direction, the Trustee will vote on the listed
proposals and, in addition, on such other business as may properly come before
the meeting or any adjournment thereof as it deems proper.
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR (a) AND (b).
WITHHOLD
FOR AUTHORITY to vote
all nominees for all
listed nominees listed
(a) The election of four directors [ ] [ ]
Nominees: R.M. Bressler, J.L. Estrin,
J.C. La Force and J.D. Nichols
(Instruction: To withhold authority to
vote for any individual nominee, write
that nominee's name in the space
provided below.)
__________________________________________
(b) The selection of auditors FOR AGAINST ABSTAIN
[ ] [ ] [ ]
PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES
Signature ____________________ Signature if held jointly _____________________
Date: __________________________, 1997
In signing as attorney, executor, administrator, trustee or guardian,
please give full title as such, and, if signing for a corporation,
please give your title. When shares are in the name of more than one
person each should sign the proxy. PLEASE SIGN, DATE, AND RETURN THE
PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
FOLD AND DETACH HERE
LOGO
ADMITTANCE CARD REQUEST
If you plan to attend the Annual Meeting of Shareowners to be held on
February 5, 1997, this form may be used to request an admittance card. Please
fill in your name(s) and address and promptly return the form. The envelope
provided for return of your proxy card may be used for this purpose or you may
tear off this business reply card and deposit it in the U.S. mail. Upon receipt
of your request and verification of your share ownership through the Rockwell
International Corporation Savings Plan, an admittance card will be sent to you.
I/we plan to attend the meeting.
Name(s) ______________________________________________________________________
Please Print or Type
Street Address _______________________________________________________________
City _____________________ State ________________________ Zip Code ________
FOLD AND DETACH HERE
<PAGE> 31
[LETTERHEAD]
WELLS FARGO
January 3, 1997
TO: PARTICIPANTS IN THE ALLEN-BRADLEY EMPLOYEE SAVINGS AND INVESTMENT PLANS
In connection with the Rockwell International Corporation (Rockwell) Annual
Meeting of Shareowners to be held February 5, 1997, enclosed are the following:
o Rockwell Letter to Shareowners, Notice of 1997 Annual Meeting and
Proxy Statement, together with a Direction Card and a return
envelope
o Rockwell Annual Report on Form 10-K for the fiscal year ended
September 30, 1996
o Rockwell 1996 Annual Report
The enclosed Direction Card should be used to instruct us with respect to our
voting of the shares which we are holding for your account in the Allen-Bradley
Employee Savings and Investment Plans.
Please sign, date and return the Direction Card in the enclosed pre-addressed
stamped envelope by January 31, 1997 so that we may vote the shares of Rockwell
International that are held for your account in accordance with your
instructions. If you do not complete and return the enclosed Direction Card by
the above date, Wells Fargo Bank, as Trustee, will vote such shares as it deems
proper.
Sincerely,
SUSANA R. RYAN
- --------------
Susana R. Ryan
Vice President
Enclosures
<PAGE> 32
DIRECTION CARD
ALLEN-BRADLEY SAVINGS AND INVESTMENT PLAN FOR SALARIED EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell
Salaried capital stock held for my account in the Allen-Bradley Savings and
Investment Plan for Salaried Employees at the Annual Meeting of Shareowners of
Rockwell International Corporation to be held at the Westin William Penn Hotel,
530 William Penn Place (at Mellon Square), Pittsburgh, Pennsylvania, on
February 5, 1997, and at any adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES FOR EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN CARD.
(CONTINUED, AND TO BE SIGNED, ON THE OTHER SIDE)
FOLD AND DETACH HERE
--------------
NO POSTAGE
NECESSARY
IF MAILED
IN THE
UNITED STATES
--------------
-----------------------------------------------
BUSINESS REPLY MAIL
FIRST CLASS MAIL PERMIT NO. 6796 PITTSBURGH, PA
-----------------------------------------------
POSTAGE WILL BE PAID BY THE ADDRESSEE
OFFICE OF THE SECRETARY
ROCKWELL INTERNATIONAL CORPORATION
625 LIBERTY AVE
PITTSBURGH, PA 15222-9363
FOLD AND DETACH HERE
<PAGE> 33
PLEASE MARK
YOUR VOTES AS [ X ]
INDICATED IN
THIS EXAMPLE
In the absence of an expressed direction, the Trustee will vote on the listed
proposals and, in addition, on such other business as may properly come before
the meeting or any adjournment thereof as it deems proper.
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR (a) AND (b).
WITHHOLD
FOR AUTHORITY to vote
all nominees for all
listed nominees listed
(a) The election of four directors [ ] [ ]
Nominees: R.M. Bressler, J.L. Estrin,
J.C. La Force and J.D. Nichols
(Instruction: To withhold authority to
vote for any individual nominee, write
that nominee's name in the space
provided below.)
__________________________________________
(b) The selection of auditors FOR AGAINST ABSTAIN
[ ] [ ] [ ]
PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES
Signature ____________________ Signature if held jointly ______________________
Date: _________________________, 1997
In signing as attorney, executor, administrator, trustee or guardian,
please give full title as such, and, if signing for a corporation,
please give your title. When shares are in the name of more than one
person each should sign the proxy. PLEASE SIGN, DATE, AND RETURN THE
PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
FOLD AND DETACH HERE
LOGO
ADMITTANCE CARD REQUEST
If you plan to attend the Annual Meeting of Shareowners to be held on
February 5, 1997, this form may be used to request an admittance card. Please
fill in your name(s) and address and promptly return the form. The envelope
provided for return of your proxy card may be used for this purpose or you may
tear off this business reply card and deposit it in the U.S. mail. Upon receipt
of your request and verification of your share ownership through the
Allen-Bradley Savings and Investment Plan for Salaried Employees, an admittance
card will be sent to you.
I/we plan to attend the meeting.
Name(s) ______________________________________________________________________
Please Print or Type
Street Address _______________________________________________________________
City _____________________ State _____________________ Zip Code ___________
FOLD AND DETACH HERE
<PAGE> 34
DIRECTION CARD
ALLEN-BRADLEY SAVINGS AND INVESTMENT PLAN FOR NON-REPRESENTED HOURLY EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell capital
stock held for my account in the Allen-Bradley Savings and Investment Plan for
Non-Represented Hourly Employees at the Annual Meeting of Shareowners of
Rockwell International Corporation to be held at the Westin William Penn Hotel,
530 William Penn Place (at Mellon Square), Pittsburgh, Pennsylvania, on
February 5, 1997, and at any adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES FOR EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN CARD.
(CONTINUED, AND TO BE SIGNED, ON THE OTHER SIDE)
FOLD AND DETACH HERE
--------------
NO POSTAGE
NECESSARY
IF MAILED
IN THE
UNITED STATES
--------------
-----------------------------------------------
BUSINESS REPLY MAIL
FIRST CLASS MAIL PERMIT NO. 6796 PITTSBURGH, PA
-----------------------------------------------
POSTAGE WILL BE PAID BY THE ADDRESSEE
OFFICE OF THE SECRETARY
ROCKWELL INTERNATIONAL CORPORATION
625 LIBERTY AVE
PITTSBURGH, PA 15222-9363
FOLD AND DETACH HERE
<PAGE> 35
PLEASE MARK
YOUR VOTES AS [ X ]
INDICATED IN
THIS EXAMPLE
In the absence of an expressed direction, the Trustee will vote on the listed
proposals and, in addition, on such other business as may properly come before
the meeting or any adjournment thereof as it deems proper.
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR (a) AND (b).
WITHHOLD
FOR AUTHORITY to vote
all nominees for all
listed nominees listed
(a) The election of four directors [ ] [ ]
Nominees: R.M. Bressler, J.L. Estrin,
J.C. La Force and J.D. Nichols
(Instruction: To withhold authority to
vote for any individual nominee, write
that nominee's name in the space
provided below.)
__________________________________________
(b) The selection of auditors FOR AGAINST ABSTAIN
[ ] [ ] [ ]
PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES
Signature _____________________ Signature if held jointly _____________________
Date: ________________________________ , 1997
In signing as attorney, executor, administrator, trustee or guardian,
please give full title as such, and, if signing for a corporation,
please give your title. When shares are in the name of more than one
person each should sign the proxy. PLEASE SIGN, DATE, AND RETURN THE
PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
FOLD AND DETACH HERE
LOGO
ADMITTANCE CARD REQUEST
If you plan to attend the Annual Meeting of Shareowners to be held on
February 5, 1997, this form may be used to request an admittance card. Please
fill in your name(s) and address and promptly return the form. The envelope
provided for return of your proxy card may be used for this purpose or you may
tear off this business reply card and deposit it in the U.S. mail. Upon receipt
of your request and verification of your share ownership through the
Allen-Bradley Savings and Investment Plan for Non-Represented Hourly Employees,
an admittance card will be sent to you.
I/we plan to attend the meeting.
Name(s) ____________________________________________________________________
Please Print or Type
Street Address _______________________________________________________________
City _____________________ State ________________________ Zip Code ________
FOLD AND DETACH HERE
<PAGE> 36
[LETTERHEAD]
WELLS FARGO
January 3, 1997
TO: PARTICIPANTS IN THE RELIANCE ELECTRIC COMPANY SAVINGS AND INVESTMENT PLAN
In connection with the Rockwell International Corporation (Rockwell) Annual
Meeting of Shareowners to be held February 5, 1997, enclosed are the following:
o Rockwell Letter to Shareowners, Notice of 1997 Annual Meeting and
Proxy Statement, together with a Direction Card and a return
envelope
o Rockwell Annual Report on Form 10-K for the fiscal year ended
September 30, 1996
o Rockwell 1996 Annual Report
The enclosed Direction Card should be used to instruct us with respect to our
voting of the shares which we are holding for your account in the Reliance
Electric Company Savings and Investment Plan.
Please sign, date and return the Direction Card in the enclosed pre-addressed
stamped envelope by January 31, 1997 so that we may vote the shares of Rockwell
International that are held for your account in accordance with your
instructions. If you do not complete and return the enclosed Direction Card by
the above date, Wells Fargo Bank, as Trustee, will vote such shares as it deems
proper.
Sincerely,
SUSANA R. RYAN
- --------------
Susana R. Ryan
Vice President
Enclosures
<PAGE> 37
DIRECTION CARD
RELIANCE ELECTRIC COMPANY SAVINGS AND INVESTMENT PLAN
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell capital
stock held for my account in the Reliance Electric Company Savings and
Investment Plan at the Annual Meeting of Shareowners of Rockwell International
Corporation to be held at the Westin William Penn Hotel, 530 William Penn Place
(at Mellon Square), Pittsburgh, Pennsylvania, on February 5, 1997, and at any
adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES FOR EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN CARD.
(CONTINUED, AND TO BE SIGNED, ON THE OTHER SIDE)
FOLD AND DETACH HERE
--------------
NO POSTAGE
NECESSARY
IF MAILED
IN THE
UNITED STATES
--------------
-----------------------------------------------
BUSINESS REPLY MAIL
FIRST CLASS MAIL PERMIT NO. 6796 PITTSBURGH, PA
-----------------------------------------------
POSTAGE WILL BE PAID BY THE ADDRESSEE
OFFICE OF THE SECRETARY
ROCKWELL INTERNATIONAL CORPORATION
625 LIBERTY AVE
PITTSBURGH, PA 15222-9363
FOLD AND DETACH HERE
<PAGE> 38
PLEASE MARK
YOUR VOTES AS [ X ]
INDICATED IN
THIS EXAMPLE
In the absence of an expressed direction, the Trustee will vote on the listed
proposals and, in addition, on such other business as may properly come before
the meeting or any adjournment thereof as it deems proper.
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR (a) AND (b).
WITHHOLD
FOR AUTHORITY to vote
all nominees for all
listed nominees listed
(a) The election of four directors [ ] [ ]
Nominees: R.M. Bressler, J.L. Estrin,
J.C. La Force and J.D. Nichols
(Instruction: To withhold authority to
vote for any individual nominee, write
that nominee's name in the space
provided below.)
(b) The selection of auditors FOR AGAINST ABSTAIN
[ ] [ ] [ ]
- ------------------------------------------
PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES
Signature Signature if held jointly
--------------------- ----------------------
Date: , 1997
------------------------
In signing as attorney, executor, administrator, trustee or guardian,
please give full title as such, and, if signing for a corporation,
please give your title. When shares are in the name of more than one
person each should sign the proxy. PLEASE SIGN, DATE, AND RETURN THE
PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
FOLD AND DETACH HERE
LOGO
ADMITTANCE CARD REQUEST
If you plan to attend the Annual Meeting of Shareowners to be held on
February 5, 1997, this form may be used to request an admittance card. Please
fill in your name(s) and address and promptly return the form. The envelope
provided for return of your proxy card may be used for this purpose or you may
tear off this business reply card and deposit it in the U.S. mail. Upon receipt
of your request and verification of your share ownership through the Reliance
Electric Company Savings and Investment Plan, an admittance card will be sent
to you.
I/we plan to attend the meeting.
Name(s) _______________________________________________________________________
Please Print or Type
Street Address ________________________________________________________________
City _____________________ State ________________________ Zip Code _________
FOLD AND DETACH HERE
<PAGE> 39
[LETTERHEAD]
WELLS FARGO
January 3, 1997
TO: PARTICIPANTS IN THE ROCKWELL RETIREMENT SAVINGS PLAN FOR CERTAIN EMPLOYEES
In connection with the Rockwell International Corporation (Rockwell) Annual
Meeting of Shareowners to be held February 5, 1997, enclosed are the following:
o Rockwell Letter to Shareowners, Notice of 1997 Annual Meeting and
Proxy Statement, together with a Direction Card and a return
envelope
o Rockwell Annual Report on Form 10-K for the fiscal year ended
September 30, 1996
o Rockwell 1996 Annual Report
The enclosed Direction Card should be used to instruct us with respect to our
voting of the shares which we are holding for your account in the Rockwell
Retirement Savings Plan for Certain Employees.
Please sign, date and return the Direction Card in the enclosed pre-addressed
stamped envelope by January 31, 1997 so that we may vote the shares of Rockwell
International that are held for your account in accordance with your
instructions. If you do not complete and return the enclosed Direction Card by
the above date, Wells Fargo Bank, as Trustee, will vote such shares as it deems
proper.
Sincerely,
SUSANA R. RYAN
- --------------
Susana R. Ryan
Vice President
Enclosures
<PAGE> 40
DIRECTION CARD
ROCKWELL SAVINGS PLAN FOR CERTAIN EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell capital
stock held for my account in the Rockwell Savings Plan for Certain Employees at
the Annual Meeting of Shareowners of Rockwell International Corporation to be
held at the Westin William Penn Hotel, 530 William Penn Place (at Mellon
Square), Pittsburgh, Pennsylvania, on February 5, 1997, and at any adjournment
thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES FOR EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN CARD.
(CONTINUED, AND TO BE SIGNED, ON THE OTHER SIDE)
FOLD AND DETACH HERE
--------------
NO POSTAGE
NECESSARY
IF MAILED
IN THE
UNITED STATES
--------------
-----------------------------------------------
BUSINESS REPLY MAIL
FIRST CLASS MAIL PERMIT NO. 6796 PITTSBURGH, PA
-----------------------------------------------
POSTAGE WILL BE PAID BY THE ADDRESSEE
OFFICE OF THE SECRETARY
ROCKWELL INTERNATIONAL CORPORATION
625 LIBERTY AVE
PITTSBURGH, PA 15222-9363
FOLD AND DETACH HERE
<PAGE> 41
PLEASE MARK
YOUR VOTES AS [ X ]
INDICATED IN
THIS EXAMPLE
In the absence of an expressed direction, the Trustee will vote on the listed
proposals and, in addition, on such other business as may properly come before
the meeting or any adjournment thereof as it deems proper.
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR (a) AND (b).
WITHHOLD
FOR AUTHORITY to vote
all nominees for all
listed nominees listed
(a) The election of four directors [ ] [ ]
Nominees: R.M. Bressler, J.L. Estrin,
J.C. La Force and J.D. Nichols
(Instruction: To withhold authority to
vote for any individual nominee, write
that nominee's name in the space
provided below.)
(b) The selection of auditors FOR AGAINST ABSTAIN
[ ] [ ] [ ]
- ------------------------------------------
PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES
Signature Signature if held jointly
--------------------- ----------------------
Date: , 1997
------------------------
In signing as attorney, executor, administrator, trustee or guardian,
please give full title as such, and, if signing for a corporation,
please give your title. When shares are in the name of more than one
person each should sign the proxy. PLEASE SIGN, DATE, AND RETURN THE
PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
FOLD AND DETACH HERE
LOGO
ADMITTANCE CARD REQUEST
If you plan to attend the Annual Meeting of Shareowners to be held on
February 5, 1997, this form may be used to request an admittance card. Please
fill in your name(s) and address and promptly return the form. The envelope
provided for return of your proxy card may be used for this purpose or you may
tear off this business reply card and deposit it in the U.S. mail. Upon receipt
of your request and verification of your share ownership through the Rockwell
Savings Plan for Certain Employees, an admittance card will be sent to you.
I/we plan to attend the meeting.
Name(s) _______________________________________________________________________
Please Print or Type
Street Address ________________________________________________________________
City _____________________ State ________________________ Zip Code _________
FOLD AND DETACH HERE
